Evening Star Newspaper, September 21, 1930, Page 69

4 News of Markets Pages 1 to 4 [ . FINANCIAL AND CLASSIFIED he Sunday Star Part 6—14 Pages WASHINGTON, D. O, SUNDAY MORNING, SEPTEMBER- 21, 1930. Classified Ads Pages 5 to 13 D. C. BANK MERGER HOLDS INTEREST OF FINANCIAL CIRCLES New Issue of Stock Ar- ranged to Complete Terms of Deal. ADVANCE IN SECURITIES FOLLOWS VOTE ON PLAN History of Both Institutions Con- cerned in the Combine Is Recalled. s BY EDWARD C. STONE. Tnterest in the local financial district @uring the past week centered almost wholly in the merger of the Federal- American National Bank with the Mer- chants' Bank & Trust Co., making an institution with $25,000,000 resources. As the week ended, the directors of the Merchants’ Bank met and ratified the action taken by the Federal-Amer- fcan Board in voting for-the reduction of the par value of the new stock from $100 per share to $20 per share. The original merger proposition had con- sidered the stock at $100 par. According to the terms of the merger for the exchange of stock, six shares of Federal-American stock will be turned in for 10 shares of the stock to be is- sued ar® four shares of Merchants’ Bank & Trust Co. stock will be ex- changed for 10 shares of the new Fed- eral National Bank & Trust Co. stock. This ratio of a little less than two shares of Merchants’ Bank & Trust for one of Federal-American stock is con- sidered in the financial district as fair as could be arranged. The difference, of course, is largely due to the differ- ence in price at which the two stocks have been selling on the Washington Stock Exchange. Bids on Two Stocks Advance. It is interesting to note that the bid prices of both stocks have advanced on the Washington Exchange since the merger was announced. Federal-Ameri- can has gained the most, the bid price being up about 30 points. Not long ago the bid was down to 270. It wound up the week Friday with 300 bid, and none for sale at that figure. Merchants’ Bank & Trust stock was bid down to 110 shortly- before the merger E).u- ‘were announced. It closed the week at 117 bid, with none for sale at that price. The last actual sale in this issue was made a few days ago at 130, within 5 points of the high mark for the ‘nr'mnt year. ‘The t sale of Federal-American stock on the exchange this mwmbe gllu at 203, which aleo proled igh for 1930. Later it dropped to 265, the year's low mark, while the last sale was made at 275. The stock pays 10 per cent so that the yield at the last sale price was 3.6 per cent. The Merchants’ Bank & Trust Cq stock opened 1930 by selling on the exchange at 133%. It advanced to 135 as the high and later sold down to 120, where it remained for some time. The last sale was recorded at 130. As the stock pays 6 per cent, at the last sale price, it ylelds 46 per cent, & higher return than that offered by the Federal- American. Banks in Other Consolidations. In connection with the merger some- thing about the history of the bank con- cerned may not be amiss. ‘The begin- nings of the present consolidation date bu:{sm the organization of the Ameri- can National Bank 27 years ago, with a capital of $250,000. In 1919 the late william T. Galliher was made president and the capital stock raised to. $600,000. The American National had been in operaiion about 10 years when John Poole, then cashier of the Commercial National, resigned and organized the Federal National Bank, with $500,000 capital which was oversubscribed the day it was offered. Mr. Poole became president and not long -afterward an- other $100,000 was added to the capital. In 1922 the Federal National and the American National were merged, having a combined capital of $1,200,000, with Mr. Poole as president and Willlam T. Galliher chairman of the board. In the seven years and ten months since the consolidation the Pederal-American had enjoyed steady growth and now has a capital of $1,600,000. The bank is located in its own bullding. Merchants Organized in 1916. The original Merchants® Bank was organized in 1916, with a capital of $300,000, by Peter A. Drury. In April, 1922, the institution was reorganized as the Merchants’ Bank & Trust Co., Mr. Drury being Srefldenl of this insti- tution until April, 1929, when he was elected chairman of the board, which position he relinquished in July of this ear,’ although he is still a director. e was succeeded by Rolfe E. Bolling. At the time of the reorganization in April, 1922, this bank took over the Dupont National Bank, which became the Dupont branch. Ir October, 1922, the Merchants established the Brook- land branch. Two years later the " Merchants took over the Exchange ‘Bank of Washington, which became the Twentleth street and Pennsylvania avenue branch. In 1926 the Merchants took over the Citizens' Savings Bank, at that time located on New York avenue, Now the name Merchants' Bank & Trust Co. passes out of the picture, as the two amalgamating banks are to be known as the Federal-American Na- tional Bank & Trust Co. They wil E" up the double team and start out single harness on November 1. Book Pictures Wall Street. Among recent new books on finance i+ an “Introduction to Wall Street,” written by John F. Fowler, jr, and|pa published by Harper & Bros. 1is book covers the technique of investing and speculating in a very interesting way, giving a simple and practical explana- tion of the machinery of the Ncw York stock market—the kinds of securities, how they are dealt in, judging of stock values, hte trend of the market and the structure, “Dollars & Sense” Appears. “Dollars & Sense,” the 1930 yearbook of Washington Chapter, American In- stitute of Banking, appeared yesterday. It is one of the most elaborate ever ml! out by the chapter. The editor chief is Raymond D. Lewis, assisted by J. Fred English, Mabel V. Royce, William G. Winstead and Willard G. Barker. The business manager is Rob- ert E. Lee, his assistants being G. Earle McGeary and J. Olan Skinner, with Harry Morris as circulation manager. ‘The book contains elaborate sketches of the Washington of the future, in- cluding the new layout of the Mall, the Lincoin Memorial Bridge, the new Bupreme Court building and the pro- posed bridge at Great Falis. Pictures of the officers and members of’ the In- stitute faculty and a review of all the mh “v:'t:u add to the un- Wwo covers. LUTHER E. SCHREINER, ‘Who is one of the vice presidents of the Merchants’ Bank & Trust Co. and in charge of the Dupont branch. This office figures prominently in the merger with the Federal-American National Bank. Mr. Schreiner has held many important compmittee assignments in the District Bankers’ Association. §1,000,000 FRUIT EXCHANGE PLANNED Leaders in Great Apple Belt Seek to Check Hurtful Competition in Sales. Special Dispatch to The Star. MARTINSBURG, W. Va., September 20.—The first step in the formation of & gigantic fruit co-operative exchange, modeled ‘0 meet requirements of the Federal Farm Board, was disclosed here yesterday when a West Virginia charter 'was granted “Growers’ Fruit Exchange,” with member co-operatives in four States, and with a capitalization of $1,000,000 authorized. Locally interested persons, including Hugh W. Prettyman, director of the State apple packing plant at Inwood, this eoumz. and Gray Silver, this city, both of have been active in ghe direction of co-operative movements for some years, said the organization looks toward regional marketing of apples in line with the declared wishes of the Federal Farm Board. The new exchange includes an estimated 10,000 acres of producing orchards, it was exg}nnlmd. and with this fruit tonnage behind, it was indicated the exchange would take its place as one of the largest, if not the largest, organizations of its kind m.x%ll'km Unludmfif‘;(nlli e e new iping includes the fol- lowing uhbm‘i co-operatives in four States: Inwood, W. Va. Fruit Growers’ Club; Valley Fruit Exchange, Win- chester, Va., Fred Robinson, president; Morgan Frult Growers’ Club of Berkeley Springs, W. Va.; Farmers and Fruit Growers’ Association of Chewsville, Md.; ‘Woodstock, Va., Fruit Exchange; Pen Mar Co-0] tive Fruit Association of Midvale, Pa.; Ohio Valley Fruit Ex- Huntington, W. Va.; Shep- , W. Va., Fruit Exchange; Berkeley Fruit Exchange, this city, and Jefferson Pruit Exchange, Charles Town, W. Va. The new exchange wiil not deprive any of the member exchanges of their working identities, it was explained. Reglonal control of marketing is one of the purposes, with elimination of sales competition and duplication be- tween rival sales agencies of this, the Shenandoah-Cumberland apple belt, and also control of shipments to terminal markets to avold any overloading of any one of these markets by too heavy shipments. Standardization of pack and concentration on fewer brands will also be emphasized. With these purposes no single sales agency for all members has been designated, each exchang: being free to select its own outlet agency. The stock of Growers’ Fruit Exchange 15 made up of 2,000 shares of common stock at $100 par value and 8,000 shares of preferred stock, also of $100 par value. n PARADE WILL MARK END OF STREET WORK Riverdale, Md., Plans for Celebra- tion Next Month—Council to Meet Tomorrow. Special Dispatch to The Star. RIVERDALE, Md., September 20.— Road work and various other impor- tant matters are scheduled for discus- sion at a special meeting of the Mayor and Town Council in Riverdale tomor- row night at 8 o'clock in the fire house. ‘When the improvements in Cecil and Madison avenue are completed it is planned to hold treet parade. This is expected to be the latter part of next month. Cecil avenue is being improved to the Colesville road with a penetrating macadam road and concrete sidewalks and curbs, and will connect with that rt of Cecll avenue lying in Hyatts- ville, which also is to be improved in a similar manner. Madison avenue is being improved from the Hyattsville line to the east- between the and ern boundary of the town. A late project finished here was the improvement of Jefferson avenue from the Washington-Baltimore boulevard to| the railroad tracks. A 26-foot concrete roadway was bullt, with sidewalks along most of the street and curbs all the way. BUSINESS IMPROVES IN NORTHWEST AREA Special Dispatch to The Star. MINNEAPOLIS, September 20.—Gen- eral business .struck bottom in the first half of September, Northwest Bancor- poration September Review says. Exaggerated statements of drought effect gave the country erroneous im- pressions of conditions in States north and west of Lake Michagan, particu- larly of Montana, where late rains re- vived the ranges, and distress market- of cattle and sheep was prevented, ’s total production of 305, X bushels, Inst year. seed ant national director of STOCKS UNSETTLED BY SLOW PROGRESS INTRADE RECOVERY Market Undergoes Sharp Re- action During Week on Poor Business News. DISTURBING REPORTS AID AGGRESSIVE BEARS Prices Declared in Sounder Posi- tion After Prolonged Recession. BY GEORGE T. HUGHES. Special Dispatch to The Btar. NEW YORK, September 20.—A com- bination of unfavorable news develop- ments and the disclosure of an unex- pectedly weak technical position were too much for the stock market this week and it gave way sharply. The list was reactionary ‘all the time and weak part of the time. At the close on Friday prices meas- ured by the accepted averages were much above those reacheti on the June break, which was the low of the year, and safely above those reached in the August decline. Nevertheless they had failed to make good the promise of a fortnight ago, when the averages had touched a new high since the late Spring. The net result was to unsettle senti- ment, to discourage operations for the rise and to increase the short account. And yet, looking at the situation from the long-range standpoint, there was no reason to be disheartened. Trade re- covery is in progress, slow and some- times almost imperceptible, but it is there. The healing effect of easy money is constantly at work. It is more than a year since trade depression began and it is almost a year since the market had the most violent collapse in its history. Time works on the side of business improvement and therefore for eventual market recuperation. Slow Revival Disappointing. These general considerations, “how- ever, do not prevent relapses such as that of this week. On the surface everything was against the stock mar- ket. In the first place, rightly or wrongly, Wall Street had counted on & more rapid trade revival than the indices show is in progress. It was frankly disappointed. Some authorities make 1t out that the commodity price decline has been checked, but the figures do not support the view. Agricultural products are at approximately the year’s low, for wheat the lowest since before the war. Cop- per is selling, according to some calcu- Jations, at the lowest since 1896, which, incidentally, was the low of the price cycle, for beginning in 1896, there was a long gradual rise culminating in the post-war inflation. Dun’s compilation of wholesale quota- tions shows, out of 51 changes, 31 de- clines against 20 advances. Doubtless we are near the low, but there has really been no sustained or important advance and reports of purchases by important consumers, such as that of copper announced this week by Western Electric_and that of steel by General Motors, have had no effect on the mar- ket for the commodities concerned, Foreign Events Disturbing. The news from abroad has been dis- | turbing. At the height of the selling on Friday, wild rumors spread through the financial community of a revolutionary movement in Germany. The cables showed that this was false, but there is no disguising the unfavorfble effect on international markets of the Ger- man political situation. Finally, to cap the climax, Thursday night's statement of the Federal Reserve Board showed an increase of $79,000,- 000 in brokers' loans on top of a series of stock market sessions of declining pricés. A resourceful and aggressive bear party capitalized all these items with a successful onslaught against the market. Tt is not to be wondered at that prices yielded. There is now no concerted support from banking sources or any- where else for the stock market. It has to take care of itself. That is, however, & point .of strength as well as of weakness. Artificial support is good for a time, but when the effect of the stimulant wears off, the patient is worse than ever. Stocks bought solely to prevent a violent break come back for resale when the crisis is past. Nothing of that sort is going on now. Attitude of Investors. On the other hand, there are a multi- tude of individuals who believe that if they buy sound stocks now, not going beyond their means, and hold them, re- gardless of intermediate fluctuations, they will be richly rewarded sooner or later. ' The trouble is that, like all speculators, they are impatient and they overtrade. Then when reaction comes, such as that of the past six days, they are forced to lighten the load at a sacrifice and begin over again. The theory is sound but the practice is faulty. It is a great temptation to accumu- late stocks which pay dividends suffi- cient to yield more than the brokerage charge on the debit balances. It looks as if all one had to do was to stand pat and wait for the profit which was sure to come. The unknown factor is the time element and that is what wrecks these seemingly well laid plans. Strong Banking Position. ‘The weekly bank statements show a continued strong position. For the Fed- eral Reserve, bills rediscounted were at a new low for the year. Member banks have increased the loans which come under the head “all others"—that is, commercial accommodation—and have decreased loans on_ securities. The changes are small in both instances, but they are in the right direction. The Street watches almost feverishly for the reports on car loadings and for the trade journal summaries of the iron and steel outlook. It gained little cheer from the railroad statistics this week, but it found some encouragement in the statements as to an increas- ing willingness on the part of consum- ers to make forward commitments in steel. It is prepared for poor third- quarter reports and it expects unfavor- able railway earning statements for August, but it does scan eagerly every item of news that bears on the busi- ness situation. After this week’s break in prices the market is in a better ition to respond to anything that looks like improvement. (Copyright, 1930.) i BOSTON MAN ADVANCED. BOSTON, September 20 (Special) — B. W, Scharfl, who in recent years has been in charge of wholesale and retail sales at the Boston office of E, H. Rol- lins & Sons, has been appointed assist- sales, at the firm's New York Wall stweet, headquarters ofce, 44 July with Sees Buying Change A. A. ZINN, President Mortgage Bankers’ Association of America, who notes a swing in buying habits away from homes and home furnishings to automobiles, clothing and recreation. Lack of demand, rather than lack of morigage money, is re- tarding the real estate business, he asserts. MONEY PLENTIFUL FORU. 3. BUILDING Public Prefers Automobiles to Homes, Expert Tells Mortgage Bankers. Special Dispatch to The Star. DETROIT, September 20.— “Those who blame the “present slowness in city real estate on lack of mortgage money always seem to forget the fact that cer- tain mortgage rates become ‘prevailing’ as a result of the needs, likes and dis- likes of millions of investors,” said A. A. Zinn, president Mortgage Bankers’ Association of America and vice presi- dent Commerce Trust Co., Kansas City, before the annual convention of the Mortgage Bankers’ Association held here. “We will experience renewed ac- tivity in city real estate and a resump- tion of building operations only when the individual citizen once more is able and willing to own or rent real estate. “At present there is a swing in buy- ing habits away from homes and home furnishings to automobiles, clothing and recreation. There is a cautlous attitude on the part of the buying public en- gendered by the collapse of unsound apartment and' subdivision develop- ments. There is a trend toward hotel life, smaller families and more employ- ment of women outside the home. There is dissatisfaction with the tendency of taxing bodies to impose upon real es- tate more than its fair share of the cost of the government.” Scores Socialistic Short-Cuts. Mr. Zinn expressed strong disap- proval of any such socialistic short-cuts to home building and home ownership as the proposal to create a Federal Building Loan Board with its proposed tax-exempt bonds. “In contemplating any stimulation of residential construction throughout the country we must face the hard fact that in most communities residential bullding 1is either progressing at a steady rate, keeping exact pace with demand, or building progressed at such an abnormal rate during the boom pe- riod that it is now a problem to find buyers or renters. Where either of these situations exists overstimulation of building at the present time wolld tend to throw out of balance the oper- ation of the law of n?p]y .and demand, thereby lowering equity values. Such losses on the of many who have paid all their savings into payments on their homes can easily prove as serious as unemployment in the bullding trade. As a matter of fact, building trades workers themselves constitute a sub- stantial portion of our solid home-own- ing citizens. It is desirable that they be kept employed, if possible, but this employment must not be obtained at the price of overstimulating home con- struction to the pdint where their pre- viously purchased home equities are put in jeopardy. Sufficient Mortgage Money. “As long as there is one family in the United States housed under insani- tary or uncomfortable conditions there is need for improvement in housing. It is not a lack of mortgage money that is retarding residential construction, but a lack of public demand for. homes. “The new commisison established by President Hoover to make a Nation- wide study of the problem of home own- ership is a sane, constructive effort to get at the facts. The commission’s find- ings should clear the atmosphere with respect to many misconceptions now ex- isting. Its most important contribution should undoubtediy consist in pointing the way to a more evenly regulated way of public construction—some method whereby building booms and resultant depressions may disappear, so that the construction, real estate and financial interests may adjust their services to the public’s normal ability and willingness to utilize their products.” Reviews Farm Situation. In discussing the farm loan situa- tion, Mr. Zinn stated: “We will not see another great movement in farm lands within the new decade. Farmerssare sharing in the standard of living, which has risen so rapidly in the past two decades. That is, higher standards are taking & larger share of the earnings of every farm family, leaving less of the net income to be applied to mortgage payments and to the purchase of addi- tional land. - While industry offers its roducts and the opportunity to enjoy hem in the higher living standards, farm Jands must stand in competition. This condition will continue until the earning power of the farm has risen far beyond its present index figures.” NEW YORK COTTON NEW YORK, September 20 (#).—A fair volume of business was reported in cotton here today, but orders appeared to be pretty evenly divided, with in- creased Southern selling and realizing absorbed by covering and trade buying. Prices fluctuated within a range of ‘5 or 6 points, with new December con- tracts selling off from 1101 to 10.96 and closing at 10.98. The general market closed steady at net declines of 1 to 6 points. . Low. January, old } 1. 1 1. 0. Business News in Retrospect Rome Next President of the Ameri- can Bankers' Association, Does Not Hesitate to Predict an Era of Return- ing Prosperity. Stevenson, John Poole Again Uses Ex- cellent Judgment in An- nexing Another Banking Unit, His Prestige in the Local Fi- nancial Field. Increasing BY I A. FLEMING. October 2, Rome C. Stevenson, a lead- ing banker of South Bend, Ind., will be elected president of the American Bankers’ Association. Mr. Stevenson has been a visitor in Washington dur- ing the last week calling on local bankers, making ar- rangements to place some of our local bankers on import- ant committees and consulting with ref- erence to future ac- tion. Having traveled over mauy States in the last few months and given close consideration to existing condi- tions, Mr. Steven- son does not hesi- tate to predict the end of the depres- sion period as at hand and he believes that the improvement, although prob- ably slow, will soon be under way. In his opinion Iowa, Illinois and In- diana wil have large corn crops and will get high prices for the grain, while the Western Coast States have enormous wheat crops, so that there will be reasonable prosperity through- out the farming district, despite the drought. Mr. Stevenson believes that industrial activity will soon be nuder way, grad- ually ,as sentiment improves and people generally get over the hard times feel- ing that has dominated for a year and B buying again. “In _the panic of 1929 in stocks per- haps 10,000,000 or mayhap a matter of 15,000,000 people were more or less seri- ously hurt,” said the next president of the ‘A. B. A, “but that leaves a host of 105,000,000 unharmed so far as Wall Street is concerned. “Then, too, many of the 1929 suf- ferers lost large paper profits, but not much actual cash, and in my belief the time is near at hand when conserva- tive purchases of good dividend-paying stocks will reward the purchaser.” John Poole’s Persimmon Pole. Once sgain, John Poole’s Jong per- simmon pole - has knocked ripe off the tree just about the time it was ready to fall into other hands. It will be recalled by those familiar with the L A Fle matter how this same pole was brought into action just as the American Na- tional Bank—a choice plum, was about to be absorbed by the Merchants Bank & Trust Co., but when all but the final arrangements had been made, Mr. Poole got busy and changed matters so that the name of the old F street na- tional bank was added to that of “Federal.” Investigation among bankers and real estate houses handling real estate notes and bonds secured by trust deed or mortgage would seem to indicate that recent unfavorable developments in connection with overmortgaged build- ings and structures given a fictitious value in the preliminary estimates and then overbonded, has not hurt the legitimate mortgage business of the District. Said the head of one big trust com- pany when approached in the matter: “I do not believe the disclosures of the last two years, or even legal proceedings against certain interests, have hurt the conservative bond and note business. Indeed the life insurance companies of New York City and other places are anxious to buy our mortgages and we are often unable to get the usual sup- ply for our own need and the require- ments of our clientele, so keen is the competition for conservatively Iissued securities. “There are certain houses that have long been in the business of making, buying and selling real estate paper, they are known as conservative, care- ful men, practical in the extreme, holding to about 60 per cent securities issues on valuation of property and buying and selling real estate paper; to three years. Bankers know them and will giadly pass along the informa- tion to any one seeking in'.estment in conservative, safe, real estate mortgages. A Serious Condition. { All over ‘the country the habit of overvaluation has been rampant for some years—it was an easy, tpough crooked, way of getting money. They do say that “easy come, easy go” and the aftermath is not pleasant to con- sider, One Bond Circular. A circular offering real estate mort- gage bonds, issued by Dunne & Co., Broadway, New York, contains a great many offerings of bonds, which from their quotations, would be judged as not conservatively issued. There are is- sues quoted in the lsit covering property from New York to Chicago and tween the two citles, showing that the practice was by no means confined to ‘Washington. ‘There are some Straus bonds offered in this circular, but not at bargain counter prices, 90 and 95 being asked. Bonds on the Mayflower Hotel of this city, maturing in 1949, first 6s, are of- fered for sale at 68 and the seconds, maturing a year sooner, at 50. ‘The first mortgage issue on the May- flower, put. out in Chicago, was/for $7,~ 500,000 and the second for $2,500,000. On the circular in question many is- sues of defaulted bonds are quoted. It is a fine commentary on the gullibility of humanity and on man’s inhumanity to man. Many crooks and bank workers are coming to this city from other large towns, where the activities ‘of the po- lice have made it too warm. ‘There is one ,thing, however, that 'may surprise them—the banks here will present. a united front against them, and as soon as an attempt is made on one bank the entire membership of the local assoclation will be warned and posted as to when, how and what. Bankers must “watch their step,” as Rome C. Stevenson advised at the Montauk convention two years ago. Investments for Women. This is to be the title of a book to be published early in October by Hi Bros. _There are countless ublications on finance in plain enough e for the woman of wdly;!: of a large ruit COMMERCIAL GAINS ARE NOTED ABROAD DURING LAST WEEK Seasonal Pick-up Stimulates Sentiment and Further In- crease Is Expected. ELECTIONS IN GERMANY ARE CAUSE OF CONCERN First Feeling of Alarm Over Ex- tremists’ Victory < Yields to Calmer View. Special Dispatch to The tar. NEW YORK, September 20.—Cable dispatches to the Business Week give the following survey of business abroad for the week ending September 20: Europe.—The more hopeful sentiment which has been evident in business cir- cles in recent weeks is beginning to be translated into actual improvement in business volume, particulariy in the case of primary materials. Prices are tending to be firmer. Though the pick- up is not yet beyond being seasonal in degree, it is stimluating commercial sentiment and further gains are ex- Financial conditions are un- ‘The event of the week is the startling result of the German elections. While gains by both extremist wings were ex- pected, no such chauvinistic landslide was anticipated. The first reaction in most business circles whs one of distinct alarm. The Fascist platform advocates a dictatorship, repudiation of the Young Plan, and revision of German frontiers, all issues which, if attempted under uresent conditions, would rock European foundations. Though attention con- tinues to be focussed on further devel- opments, alarm is being replaced by the belief that German political changes are more apparent than real, and that they represent primarily an expression of profound popular dissatisfaction over the recent vacillating and ineffective administration rather than any rea- soned support of extreme programs. Developments Foreseen. Observers foresee three possible devel- opments. In the other of their increas- ing probability, they are: (1) A Fascist effort to displace parliamentary gov- ernment with a dictatorship; (2) for- mation of a center and moderate Socialist coalition which a majority in the business world would favor, and (3) a parliamentary deadlock and dissolu- tion before Spring, with new elections favoring more conservative programs and depriving the extremists of much of their spectacular gains last week. Though immediate administrative diffi- culties in Germany were increased rath- er than mitigated by the election, and though greafer uncertainties are ex- pected further. to prejudice German business prospects abroad, it is notable that foreign credits in Germany so far have not been withdrawn. Both Euro- pean and German stock markets, though they reacted violently downward at first, are resuming their upward trend which first became evident at the be- ginning of the month. Authorities accept this as an indication that con- fidence in the prospects for general business improvement is not materially, or at least not immediately, impaired. Great Britain.—Optimism in the busi- ness community is increasing, although the slump as, yet is broken only by the slightest signs of improvement. The iron and steel industry is improving and inquiries are increasing. Cotton spinners are cheered by some revival of the China trade. Stock markets are disappointing. Rises a week ago have not been maintained and the general investing public is not com- ing In. The rubber market has dis- played unexpected calmness since the restriction verdict, with both the com- modity and shares stiffening. ‘Unemployment increased this week by 79,127 to a total of 2,139,571. New conversations. have been inapgurated between Liberal and Labor leaders to consider relief works which may in- clude a large development of telephone services. 2 v Anxiety Over Elections. France.—Business men showed no little anxiety over the results of the German elections. Without disguising this uneasiness, it is notable, that the general French attitude reflects, not 50 much alarm, as a tendency to wait and see what happens. Sharp stock market recovery this week after pro- longed apathy created optimism, par- ticularly when it became evident that the public was participating. The trend of French economics, nevertheless, is toward inflation of values rather than expansion of activity. In fact, there is less evidence of seasonal revival in France than in almost any other country. "The government has moved to help the farmer to organize and finance the orderly marketing of wheat. The im- mediate need is to get some plan func- tioning at once because farmers who were forced to sell the bulk of last year's bumper. crop at low prices are now unable to carry even the cur- rent short crop. Germany—Business sentiment is deeply dismayed at the results of the election which increased Bruening's minority in the Reichstag from 15 to 161. Business generally envisages pro- tracted negotiations toward the forma- tion of some kind of coalition govern- ment, if not a mmgku parliamentary deadlock. The stock exchange reacted to the announcement of the disappoint- ing returns in the elections by sharp drops in the leading securities of from 5 per cent to 15 per cent. ‘Unemployment, continues at record levels, though the increase in the second half of August was only 28,000, against 80,000 in the first half of the month. The total number of German unem- ployed September 1 was 2,870,000, which compares with 1,360,000 on that date last year. Business anticipates an in- crease in the number of unemployed during the coming Winter to a mini- mum of 3,500,000. —————————e Miss M. J. Winnifree, secretary of the Continental Trust Co. during all the years of its existence and now an able assistant to Wade H. Cooper, president ! of the Commercial National Bank, has been invited to write a chapter for the Harper publication on “Loans on Secu- rities.” “Miss Mary,” as her intimates refer to her, is thoroughly competent to handle the subject. Col. Cooper also has given Miss Win- ifree the assignment as delegate to the annual convention of the A. B. A. September 29 at Cleveland. Alblon K. Parris, old-time Washing- ton citizen, dominant in financial and security circles, junior member of b 'W. FRANK PERSONS, Who will preside at part of the con- vention sessions here this week of the American Association of Personal Finance Companies. He is executive vice president of the organization, is widely known in Washington as a for- mer officer of the American Red Cross, and is deeply interested in remedial loan legislation in many States. SMALLER PROFITS REPORTS EXPEGTED Wall Street Looks for Deep Cuts in Earnings of Corporations. BY PRESTON S. KRECKER. Special Dispatch to The Star. NEW YORK, September 20.—Day-to- day statistical evidence has prepared ‘Wall Street for a series of poor earn- ings statements by corporations cover- ing_third-quarter operations. . There is little doubt that the business depres- sion sounded new depths during that period which will be reflected in profit accounts. Analysts estimate that industrial pro- duction so far this year has run about 18 to 20 per cent below that of a year ago, while corporation profits have de- creased from 15 to 20 per cent. How- ever, the cloud has a silver lining in the well sustained dividend payments by corporations. Some Firms Show Gain. The dBcline in business and in profits, moreover, has not been unanimous. It was refreshing to have the manage- ment of the Diamond Shoe Co., operat- ing a chain of more than 90 stores, an- nounc:hthlt its business has been run- ning ahead of that of a year ago, and that the ecompany had increased the dividend 'rate. ‘The number of cor- porations which are in a similarly happy position is perhaps larger than one would think. A compilation of earnings reports so far issued this year shows that 241 cor- porations have reported increases over last year, which admittedly was the most prosperous period in the Nation's history up to the middle of the Sum- mer. In other words, comparisons are being made with operating results prior to the decline which set in last July. The number of companies which showed diminished earnings was, to be sure, substantially larger. It totals 493, or about twice the total showing increases. ‘The ratio of 1 to 2 is not a bad one, however, and tends to prove that con- ditions have not been uniformly bad. ‘The record of corporation dividends is even better than that of earnings. On the whole, strange as it may seem, stockholders of corporations have drawn down materially larger incomes from their investments so far this year than they did during the corresponding 1929 period, and that despite the fact that 1929 dividends totals registered a new high record. Out of 1,319 corporations, of which statistical records have been kept only 109, or less than 10 per cent, have cut their dividends, while 55 have in- creased them and 1,055 companies have made no change. Still more impressive is the statistical evidence on aggregate amounts paid. The figures show that every month this year so far the total amount of cash distributions by cor- porations was larger than that during the corresponding period of last year. Dividend Declarations. Altogether corporation dividend dec- larations from January to August, in- clusive, are placed at $2,992,719,573. In the corresponding nine months of last year the total was $2,617,357,607. ‘The gain for the 1930 period, therefore, has been $375,361,866. The fact that dividend disbursements have exceeded those of last year to date is partly due to increased payments by & limited number of corporations, but the principal explanation is that many com- panies have increased the volume of shares outstanding, through split-ups or stock dividends, and have either main- tained former dividend rates on in- creased shares or paid more than the equivalent amount on the increased cap- italization. That corporations could make such & dividend record in a depression year is a tribute to the financial strength of in- dustrial organizations, especially the large units, which accumulated large back-logs of cash surpluses and there- fore can afford to maintain rates of payment even during a period of rela- tively low current earnings. Policies have been to maintain dividends wherever that could be safely done in order to alleviate the effects of the busi- ness decline. {(Copyright, 1930.) $50,000,000 INSURANCE “ON THEATER EMPLOYES Over 12,000 employes of Loew’s, Inc., and afliated motion picture interests, are covered by & group life insurance rotection. The plan is co-operative, th employers and employes sharing the cost of the insurance. Should an employe become totally and permanent- ly disabled before the age of 60, his insurance is payable to him instead of to his beneficiary. SEES BUSINESS GAINS AS NOT FAR DISTANT President T. B. Macaulay of the Sun Life Assurance Cb., agrees with the bal- lot of the leading bankers of the United States who recently voted that condi- tions in this country would improve be- mllcy totaling approximately $50,000,000 | wi Crane, Parris & Co., a great well wisher for the city, passed on Wednesday night at Toronto, Canada. Parris loved Washington and es- - QGeorgetown. He was known to circle mnonu friends le he will be of close as “AlL" and in this ginning with next month. One-third of the bankers thought that the first of the coming year was a probable date for the upturn and two-thirds voted for the be- ginning of next month. President Ma- caulay does not, however, set a date for the turn but declares that it is in the not far distant future. OVERCAUTION HELD CAUSE FOR LAGGING TREND IN INDUSTRY Merchant Believes Fall Busi- ness May Be Up to An- nual Average. 1.OW STOCKS OF GOODS MUST BE REPLENISHED Return of Public Confidence Vital Factor in Revival of Trade. BY JOHN F. SINCLAIR. pecial Dispatch to The Star. NEW YORK, September 20.—"“Indus- try is operating in a cheaper commodity market, and while the dollar volume is lower, owing to the lower average of unit cost, it is probable that the usual number of units sold during the Fall season will be maintained this year,” says J. C. Penney, merchandiser. “Overcaution” is the deadweight hold- ing business back now, he thinks. “Depression and prosperity are larges 1y governed by mass psychology,” con- tinued Mr. Penney. “The public rushes, to sell in a falling market ,and a panic is created; or rushes to buy, and pros< perous conditions ensue. B “The suddent retrenchment of buy< ing resulting from financial depressions, creates a surplus of commodities which stagnates the entire country. This mar+ ket glut must be absorbed before the machinery of business can revolve as usual. On the other hand, widespread confidence and ready spending speed up consumption and create a period of prosperity.” $ ‘The exceedingly low stocks of goods now on hand in many lines will soon i‘orc! business out of low gear, he be- eves. Sees Gain in Buying. “The public, having curtailed buying during the last few months, will soon find it necessary to replenish wardrobes and lay in other merchandise,” Mr. Penney declared. “The last few months have seen a retardation of manufactur~ ing. But manufacturing will have to be speeded up to meet increasing Fall de- ‘mands.” ‘This prominent business man thinks, however, that the growing feeling of confidence on the part of the public that the worst is over and that business is slowly on the upgrade is the “most potent force” at work today. “Generally speaking, I can see little reason for the present depression be~ yond the accumulated weight of fear which paralyzes action,” Mr. Penney told me. “In saying this I am not ob= livious to conditions created by the drought. The depression existed before the drought and is due to more deeply seated causes. The country is sound and there is no basic reason why the wheels of industry should not hum, bringing employment and prosperity to every worker throughout the land, Though our return to normal business doubtless will be gradual, I believe we are headed for it now.” - Mr, Penney, whose stores are to be found in hundreds of cities throughout the United States and Canada, was born in Hamilton, Mo., 55 years ago. After a course in high school he became a grocery clerk. But not for long. For in 1902 (when fust 27) he founded the J. C. Penney Co., which now operates more than 1,400 stores in the United States. It was at the beautiful Winter home of Mr. Penney at Miami, Fla., that President Hoover spent some weeks in 1929 after his election and before his inauguration. Mineral Production. Any country that can produce $5.- 830,000,000 in mineral products in one year is some country. And that is just what the United States did in 1029, when it showed an 8 per cent increase over the mineral output of 1928. These figures are Gov= ernment. res, and while the total of nearly $6,250,000,000 for 1926 and that of nearly $7,000,000,000 in 1920 was not passed, it's still an enviable rec- ord. Petroleum oil production passed the billion barrel mark for the first time, showing an increase of 12 per cent over 1928. The metallic products showed an increase of about 15 per cent over the preceding year, All metals except gold and silver showed an increase. Gold production declined about 1 per cent, and while the quantity of silver increased, the average and total value both decreased. But a Nation that can turn out min- eral products worth half a billion dol- lars a month is far from being down and out. By comparison, the United States mineral production is of greater value annually than that produced by the rest of the world combined. And there are 17 people living outside of the United States for every one that lives inside. Many men, considered outstanding cuccesses last year, are looking for jobs this year, New York is full of them. “Good jobs are at & premium down here. A lot of successful fellows last year are having their shoes resoled this year,” said a Wall Street man to me as we were walking along the famous street. Definition of Success. “What is this thing we call success?” I asked him. “I have never seen & more compre= hensive definition than the one sub- mitted years ago by A, Raymond Johns of Wyandotte, Mich., in a national con- :eqt. And he won a $1,000 prize for Here it 1s: “Ideals are as different as viewpoints. Real success is not wealth nor fame, but helpfulness. Do -something worthy of your powers—shoemakers and stokers are as necessary as scientists or states- men, and any helpful work is honorable. But to be a tinker when you might be a thinker is to be unsuccessful. . He who molds iron when he could sha) destinies, or guides a &hip when he could direct an empire, fails. Success consists in never being discouraged, but in ever moving forward—cheering, help= ing, being ’iour very best and leaving the world the better for your life.” For the first eight months of 1930 the number of deaths from automobile accidents is about 1,200 in excess of the number reported for the corre- sponding period of last year—a 6.58 cent increase. During the last few month,s however, the trend of fatali- ties has been downward. Nineteen States show an increase over the average for the first eight months of 1929, These States are Are kansas, Idaho, In , Iowa, Kentucky, Maine, Michigan, Minn Missis~ sippi, New Hampshire, New Mexico, New York, North Carolina, South Carolina, ith Vermont, Dakota, Soul Virginia and Wisconsin.