Evening Star Newspaper, May 17, 1931, Page 65

foodstufls. comes, forcing | o s wa 0 e S Geis News of Markets Pages 1to § Part 6—12 Pages FUROPES BUSINES REFLECTS GENERAL PESSHSTE TONE Fiscal Difficulties Cause Concern in Germany and England. STOCK MARKETS EXPECT POORER YEAR THAN 1930| Political Issues and League Ses- sion Next Week Already Being Felt. Special Dispatch to The Star. | NEW YORK, May 16.—Cable dl.s-1 ?uwhes to The Business Week give the | ollowing survey of business abroad for the week ending May 16: Europe.—Business sentiment is be-! ginning to lose its confidence. Com- modities have manifested inability to| steady themselves. Stock markets have | sagged appreciably except for '.echnl(_‘nli reaction in FPrance. Fiscal difficulties and the prospect of nex taxation, esp cially in England and Germany, are| causing considerable concern. Disap- pointing company reports continue to be published. The collapse during the week | of the Austrian Creditanstalt, East Eu- rope's biggest bank, is thought to be due to special causes, but has caused not a little shock. Also many difficult political issues are expected soon to come to a head, including reparations, war debt revision, and the question of t luss, which comes before the league next week and which now is given added emphasis by the Vienna bank faflure. The above, and other co! siderations, have ngxed business vitality and account for the disposition again 'u’)‘ take short and more pessimistic ws, Commodity weakness is largely ascrib- sble to maldistribution of stocks. Al- b supplies of nearly all raw ma- are still excessive, despite the fact restriction schemes are be- to show some effect, stocks have congested in first hands where they are conspicuously visible but where they conceal virtually the complete ex- ‘haustion of reserves normally carried Industries and ‘the distribut- ing trades. This condition is not yet realized though it will probably prove the pivot on which current condition: will turn. Meanwhile bear speculatio: is without a_constructive counterpart. Hesitancy of buyers to cover more than immediate requirements, and the very gradual, though actual, increase in con- sumption kas abnormally and unnatur- ally narrowed depressed primary mar- ket&b “ In nlle e;sehol a few products, notably wool and wheat, prospects have brightened. o i Won't Exceed 1930 Earnings. Stock markets are realization flect the the that P it, even were ex- Fall improvement to ma , H 3\ , if earnings won’t exceed, even equal, 1930, the first half of which z‘u el v;l.yt.m.\v!. Bonds, ho‘:ever. somew] stronger. Reduction of the Federal Reservi Tate 2 and reduce British bill rates to ly 25-16 per cent and settle conceded, in fact, that are W which further tion of bank rates below already mally low levels fail to remove. s a gesture of lflu'b - s a gesture of co-operation and also as discouraging futile movements of gold {rom one center of excess, such as Paris, to another, sueh as New York, and as facilitating much sooner ultimate capi- tal readjustment when international S Aons” miserissieous dove ong aneous developments, March fron and steel production figures are now available and show increases throughout Europe. Iron increases—In France, 7 per cent; England, 12 per cent. Steel—Prance and England, 4 per cent: Tallal” Apeil Seat and Fon bt 3 and iron ore figures, however, indicate no further improvement. Budget Effect Unsettled. London.—Business s bad. ‘That much-vaunted recovery has failed to materialize and with the budget out of the way there is nothing to blame but | the after effects. Actually these should not be minimized too much. Business, after several weeks of arguing, has not reached a clean-cut decision on the all- eround results of the new budget. It| has decided that Chancellor Snowden | did overestimate—grossly—the yield next | year from the income tax. This threat, | of heavier taxes a year from now is rolling into snowball proportions in cur- Tent discussions and the worry is| enough to retard business. | The pessimism which is taking the place of the confidence which persisted | the first three months of the year is| without foundation. Cottons, it is true, are drawing increasing inquiries, but | actual orders for early delivery are emall. Rayon is doing well. Wool is quiet. Iron and steel activity is slack- | ening. Nonferrous metals are at sixes and sevens again, with pig lead at a new all-time low. Coal trading is better in many flelds, but the Sots pits are inactive, and many collleries, especially in_ Wales, report they cannot find markets for their | cheaper grades. | Tendency Is Better. | Paris.—An eleventh-hour change in | sentiment, which implies renewed con- fidence ‘n Briand’s forcign policy, brought 74-year-old Paul Doumer, re- tiring president of the Senate, into the | residency and supposedly leaves M. | riand to administer foreign affairs in the trying conferences which are imme- diately ahead. Proponents of the “grand old statesman” of France look on the result as a vote of configence for the efforts of Briand in the ,ast, and in his unique ability to handle the in- volving problems of the German cus- toms union, credit relief for Central Europe, and disarmament in the future. | ‘The direct effect on business will be clearer after the League of Nations' meeting gets under way next week and affairs take definite trend. Certainly French policy is likely to undergo small change as an immediate result of the election. In the meantime, the tendency to- ward seasonal improvement has been maintained, but general conditions are uncmefl. Re, ed unemployment dec] for the third successive week. Car loadings have risen and are now less than 1 per cent below those of a year ago. stock market has recov- ered an unbroken 12 per cent decline since mid-February. ce in- flation probably reached the turning point with the second week in In- by | The one thing they do not want to do 0 steel industry has contributed practi- |three months have been largely nulli- |cates the state of almost complete ar- FINANCIAL AND CLASSIFIED he Sunday Star WASHINGTON, D O, SUNDAY MORNING, MAY 17 1931. Classified Ads Pages 5 to 12 Speaker Signed QUAKER CITY BANKER WILL BE AT HOT SPRINGS. 0. HOWARD WOLFE, Cashier of the Philadelphia National Bank, is on the program for the com- | ing conventicn of the District Bankers’ Association. He will speak on “Interest | on Deposits and Methods of Computa- | tion.” He took a very important part in the recent bank management confer- , ence held in this city and is one of the ablest bankers in ti STEEL MILLS FIGHT WAGE REDUCTIONS But All Other Items of Econ- omy Are Rigidly En- forced. Special Dispatch to The Star. PITTSBURGH, May 16.—S8teel mills are watching their costs with more and more rigid closeness, and no economy appears to be too small to be adopted. is reduce wages. Some observers have been skeptical about this, suggesting that the steel of- ficlals who have expressed themselves against wage reductions were not as strong in their attitude as they pre- tended, or that they might alter their position later, on the plea of changed conditions, but there is no visible rea- son for supposing anything of the sort. Steel men, on the whole, have been very fair and frank with the public for many years. Seen Poor Economy. ‘The policy of maintaining steel mill ‘wages, which ins rates per hour, per day, per ton, is based on several con- siderations. In the first place, it is held it would not be good economic policy in general to reduce wages, unless they are well above the general level, which is not ‘the case with steel. The build- ing trades ought to come down quite & lot first, and perhaps railroad wages next. Furtherms the steelmakers have been dividing employment, whereby many men get only two or three days | of work a week, and this is bad enough without reducing rates as well. The | cally no men to the ranks of the totally unemployed. Finally, there is the very practical argument that a general wage reduction would simply be handed on to steel buyers, quite possible with ac- cretions, 50 that the mills would not be any better off. As to buyers, it is strong- | ly contended that there is no steel de- | mand lost on account of price. Steel is cheap relatively to the things that are made from it, and those things are generally cheap also through mass pro- duction. Sabstantial Cut in Men. Prices now being realized on steel shipments are no more than 25 per| cent, above average prices in 1913, or 20 per cent above the 10-year average | through 1913, the period 50 often taken to represent the pre-war standard in many things. There has been great progress in efficlency all along the line, Wwith a substantial reduction in the num- ber of men required for a given output, but there have been some large and unavoidable increases. Wages are much higher, and so0 are freight rates. Steel ingot production in the past week has been at about 45 per cent of capacity, production having dropped about a point a week in the last fort- night. The decrease has now been al- most arrested, and it seems not unlikely that the Summer low will be around 40 per cent. quarter totaled $11,000,000, which is 41 per cent below the first quarter in 1930. Imports totaled only $5,000,000, a drop of 75 per cent. Berlin.—The undertone of German business 15 increasingly pessimistic. Gains on the stock market in the first fled by the declines in recent weeks. Absence of any reaction to the cut in the rediscoun: rate in New York indi- tificial isolation of the German money market. Local opinion is apprehensive of the depressing infiuence of renewed sales of securities on American account. The black pessimism is not based alone on the domestic outlook. The condemnation in the French Chamber of Deputies of the pending customs union with Austria has profoundly added to local gloom. To this can be added the abrupt, almost discourteous, breaking off of negotiations for closer economic relations by Rumenia. In home industry, coal and steel continue to_show the most discouraging records. Encouraging toss are not alto- gether lacking. Unemployment has de- clined 700,000 since the February peak. March savings deposits increased 10 per cent over the figure for last year, and department store sales for March are only 4 per cent below those of a year ago. gmm.—'!‘ha money market is slowly recovering from its extreme stringency. Exchange, strengthened throughout April rement favor- ing the guilder, is weakening, as a result of the new outward flow of bank funds. Dollar exchange is an ex- ception, due in part to the recent re- duction in the rediscount rate in New York and in part to the weakness in Wall Street, which has frightened buy- ers of dollar securities. im markets are gloomy. To unfavorable Wall Street reports are added continued low records for most Dutch stocks (chiefly Royal Dutch and Java Bugar). This and the poor year end results of most favorites largely is { Loan & Trust Co. | President, LOCAL SECURITIES KEEP UP ENVIABLE DIVIDEND RECORDS Excellent Yields Are Being Maintained on Many Important Issues. WASHINGTON BOND CLUB READY FOR ELECTION Mutual Savings Banks to Hold Convention Here—Noted Speak- ers on Program. BY EDWARD C. STONE. Local securities have chalked up an unusually good record since the New | York Stock Exchange crash and the succeeding Nation and world-wide de- pression. While Wall Street has sent out a long and painful list of dividend cuts and omissions, Washington stocks have been moving along quietly, prac- tically all of them maintaining divi- dend payments. A glance at the Washington Stock Exchange miscellaneous list reveals the fact that all but two issues are paying regular dividends. Of course the yields vary a great deal, but the money of Jocal investors has not been rendered “dead” by the passage of dividend dis- bursements. The same is true of local bank stocks. In the national bank group the highest return right now is on National Bank of Washington stock, which yields 5.7 per cent, the stock selling at 225. All these stocks are yielding over 3 per cent. The yleld on Commercial Na- tional is 4.5, District 3.9, Federal-Amer- ican 4, Liberty 3.6, Metropolitan 4.8. Riggs 4 and Franklin 5.6. Others which are paying regular dividends have not recorded recent sales on the Exchange. ‘The zruny!cgggnn{ lnd2 gavln‘l b:!;:(‘ groups are g from 2.7 per cen! 5 per cent. American Security yields 4.5, National Savings 2.7, Union Trust 4.8, Washington Loan 3.1, East Wash- ington 4.8, Security Savings 3.7 and Seventh Street 4.1. Every issue on the Exchange in the public utilitles group is also paying a return on the investment. Capital Trac- tion yields 11.8, Norfolk & Washington Steamboat Company 6.3, Potomac Elec- tric Power 6 per cent preferred 6, Po- tomac Electric Power 515 per cent pre- ferred 5, Washington Gas 3.1, Washing- ton Railway & Electric common 1.6 and Railway & Electric preferred 5.1. Many other issues on the local board | might be mentioned, but the above list is sufficient to show what local stocks are doing. Bond Club Election Arranged. Plans_for the annual Spring outing of the Bond Club of Washington have been about completed. The outing this vear will be held May 22 at the Manor Club near Norbeck, Md. Sports will be | in order during the afternoon. At- tractive prizes have been provided for golf, the obstacle putting contests, horseshoe pitching and ping pong. Dinner will be served at 7 p.m., imme- diately after which election of officers for the ensuing year will be held. The Nominating Committee has proposed the following: President, Lawrence M. Proctor; vice president, T. Baker Robinson; secre- tary-treasurer, Charles M. Henderson; governors, James P. Nolan and James H. Lemon. The regular Stock Exchas will be held and substantial pri have been provided for this feature, The acceptances so far indicate that this should be one of the most successful outings ever held by the club, with an event unusually large number of guests ate. | tending. T. C. Montgomery, general chairman, and members of the Enter- tainment Committee consist of the fol- g: Charles Carol Morgan, Winslow B Van Devanter, Richard Hynson, Frank M. Hall, Edwin D. Flather, Carl | R. Kurtz, Arthur Foraker, Marshall O. Exniclos, Elmer Sauter, Donald Mc: Knew, Richard Winder, James M. John- ston, George M. Perris, William M. Can- by, John C. Barcalow, Floyd Miller, C. H. Severence, R. Bascom Broun, Ralph M. Wolfe and Ennalls Waggaman, Club Organized in 1925. The Bond Club was organized in 1925, and during the Winter months of each ycar lunchcons are held at which ad- dresses by prominent men are given. In addition to the active membership the associate membership is made up of the following members of the bank- ing fraternity Joshua Evans, jr, president, District National; Robert V. Fleming, president, Riggs National, Willlam D. Hoover, president, National Savings & Trust Co.; John B. Larner, president, Wash- ington Loan & Trust Co.; John Poole, president, Federal - American National Bank & Trust Co.; Corcoran Thom, president, American’ Security & Trust Co.; George W. White, president, Na- tional Metropolitan; E. Percival Wilson, s2cretary, National Savings & Trust; Earle Amick, assistant cashier, Natlonal; 8. William Miller, assistant treasurer, Union Trust James Dulin, assistant treasurer, American Security & Trust, and Norman E. Tow- son, assistant treasurer, Washington The present officers of the club are: Sidney T. Thomas; president, Lawrence M. Proctor, and secretary-treasurer, T. Baker Robinson. When the Boat Missed “Pop.” Echoes of the years when the late I A. Fleming was active in the local financial district are still heard. When he lived in Chicago he was a close friend of Lyman Gage, who afterward became secretary of the United States Treasury. Frank A Vanderlip, the distinguished banker, was a young man inncmfilaso m"mw. days and “Pop” ew him well. They met lon‘E Frey 4 t daily for a ut one of the best anecdotes t Mr. Fleming is recalled in e:;n:cl:?l‘;n with the second or third out-of-town convention of the District Bankers' Assoclation which was held aboard one of the steamers of the Norfolk & Washington Steambcat Co. After one of the business sessions, the boat pulled into Yorktown to spend several hours. ‘The bankers and their guests went ashore with the understanding that the boat would leave at 3:15 in the afternoon. When 3 o'clock arrived, the captain was told that everybsdy was on board and that the boat might as well sall in order to have a longer cruise down the bay before dark. The whult l'[:ldewh the captain gave the signal and the big steamer move into midstream. i As the boat got a good start down the river, scme one looked toward the dock. Lo and behold, there was “Pop," white-haired, calm, dignified and en- tirely alone on the wharf, after a visit attributed to acute depression in the May. Bicies, then declined oniy sightly, but 2ffected every category except certain East Indles, which is affecting every branch of business. reducing all in- n and stopping [y to the golf links. The rest of the story is short. The boat turned back and picked up the veteran editor. “You pulied out' 15 minutes ahead of time,” Wes all he said a8 he walked up the vice | ] Son Takes Mantle CHAIRMAN OF BOARD. OF FIRST NATIONAL. GEORGE F. BAKER, JR., Heir to the Baker millions, who has already assumed some of the important financial duties laid down by his father, who was a director in 40 big corpora- tions. The younger Baker is following little about his future plans. BANKS DECLN DECLINN PUBLIC DEPUSTS cure Depositary With Nec- essary Security. BY C. B. UPHAM. State and county officlals in a num- | ber of the States are having difficulty in getting banks to accept their money in these days of low interest rates. The latest instance is that of the treasurer of Yankton County, 8. Dak., who has been unable to secure any Pt:mmty depositaries for the year 1931. | He has even advertited for applications from banks for handling the county funds. ‘The attorney general of the State has now ruled that if he cannot induce a | bank to accept the deposit and pay in- | terest, the county treasurer will be jus- | tified in designating depositaries that will pay no interest, but will give the necessary security, and if no bank will either pay interest or give security, he may nevertheless deposit the funds in an “active” depositary under a law of 1927, which luckily seems to have been discovered, to meet the emergency. More Critical Elsewhere, | _'The situation in many States is even | more critical than in South Dakota. In that Btate, the interest rate is set at “‘not more than 2 per cent per annum.” In others the rate fixed by statute is a minimum rather than a maximum, and higher than 2 per cent. In addition, such funds must be secured by the deposit of high-grade collateral or a corporate surety bond, in many cases. It is just a losing business, the banks say, to accept public funds, and in every section of the country they are refus- ing to qualify. The tax collector for a county in a Southern State recently found himself in the position of being required to place tax funds in a bank in the county which would pay ipterest where- as bank failures had resulted in his particular county being destitute of banks with the single exception of one institution which refused to either pay linterest on the deposit or give security |for it. After digging around in the legal tomes the State's attorney general unearthed a hoary statute which per- mitted the sheriff of a county to make deposits in banks unrestricted. Safety and protection for the county funds were provided by having the tax- . | gatherer turn them over to th- sheriff, who then deposited them in the very bank which had refused to give intercst or security. Revision Is Needed. Fixed legal requirements as to interest on public deposits are not flexible | enough to meet the shifts of mones market rates. There is need for a revision in most States of the public funds statutes, and indeed, perhaps a re-examination of the reasons for re- quiring banks to give security for the moneys of States and their subdivisions, thus making them preferred creditors, in case of bank failures. Recent court decisions denying private depositors such preferment have criticized the whole philosophy behind security for public deposits. ‘Treatment of public deposits is being discussed at the annual conventions of the State Bankers' Associations which are now_ beginning their sessions, and at the Bank Management Conferences being conducted by the American Bank- ers’ Association, and it is possible that some uniform way out of the present difficulties will be devised. (Copyright. 1931.) FREDEEICKSEURG TO HAVE NEW FLASHLIGHT PLANT Special Dispatch to The Star, RICHMOND, Va., May 16.—Flash- lights containing no battery but with a generator instead are to be manufac- tured in Fredericksburg by a million dollar concern, a charter for which has been granted by the State Corporation Commission under the name of the | Collins Flashlight Corporation of Vir- ginia. Bertrand Collins of Takoma Park, Md.,, is greslden! of the company. A location has been selected 2 miles north of Predericksburg, and it is un- derstood that construction will start in June. It is planned to employ about 500 persons at the plant within three years' time, though operations will at first_be conducted on a smaller scale. gangplank. “You're right,” agreed the tain. c'lgllns are completed for the eleventh annual conference of the National As- sociation of Mutual Savings Banks which will meet in this city, May 20- 22. Noted speakers are on the pro- gram. Addresses on the first day will be given by Julius H. Barnes, chair- man of the Chamber of Commerce of the United States; Matthew Woll, vice president of jthe American Federation of Labor; Henry Bruere, president Bowery Savings Bank, New York City, and Rome C. Stephenson, president American Bankers' Association. Ogden L. Mills, Undersecretary of the Treas- ury, and Dr. George M. Wiley, assist- ent commissioner of education of New York, will speak at the second session, while Louis T. McFadden will address the luncheon that day. his father's example and is saying very i | Dakota County Unable to Se-| (GONDITION OF RAL STOCKS MAY FORCE FREIGHT RATES UP Wage Reductions Regarded as Only Alternative for Carriers. OPERATORS AND WORKERS FIGHT LOWER PAY SCALE Week’s Minimum Prices on Ex- change Drop Below Record for April. BY CHARLES F. SPEARE. Special Dispatch to The Star. NEW YORK, May 16.—Last Decem- ber the average price of stocks de- clined nearly 30 points below the level of November, 1929. In April this year stocks broke through the low average of 1930, but only a little. This week the minimum prices that had been established at the end of April have been violated by a slight margin. More important than this has been the decline in the railroad average to a figure less than 50 per cent of that in the Spring of 1930. With industrial stocks, in which the public has its largest investment and whose course determines the speculative trend, under steady pressure and lower today than in the last half dozen years. That investors are upset by the re- duction in dividends, and by the lack of proof that the business situation will improve to any extent in the next four to six months, is evident from the steady liquidation taking place. The disturbance to prices is not confined to common stocks. It has been almost as violent this week among the junior bonds of railroads as well as in those of industrial com- panies and foreign governments. It is safe to say that there is not a holder of securities who has not experienced recently a severe decline in some part of his list. Not much is said about the effect of this on the purchasing power of the country. It figures quite prominently, however, in the absence of demand in numerous non-essential industries and is even reflected in smaller sales at retail of actual ne- cessities. Commodity Prices Slump. Commodities and securities have again been moving sympathetically. While stocks and bonds have been shrinking, the level of commodities is steadily being reduced. This week com- pletes a two-month period of decline that has brought wholesale prices 21 per cent below those of a year ago and within & few points of the level pre- vailing just prior to the outbreak of the war. Farm products, foodstuffs, textiles, metals and building materials have slumped off sharply. The market for steel scrap has been demoralized, with quotations this week comparing with those in 1914. Those for copper have not been equaled since the last great depression—that of 1893. Iron and steel production seems to have reached a level where it is being main- taind after dropping from 57 per cent to 47 per cent. ‘The most acute of the many troubles surrounding the investment situation originates with the railroads. Prices of railroad bonds held by insurance com- panies and savings banks, and to no small extent by commercial banks, have declined to a point where the deprecia- tion involved occasions alarm. What have been regarded for years as the cholicest of the railroad common stocks are now selling between a 7 per cent and a 12 per cent basis, with an aver- age yleld of 8% per cent. It is true that the carriers made a { much better exhibit in net operating in- | come in March than in February and | that, in the past six weeks, there have | | been evidences of an improvement in | thir car loadings. The loss in gross | revenues, however is too great to be | compensated for in a reduction in ex- | penses, as the policy of limited main- | tenance and release of employes has been carried as far as it can go with- {out permanently | values. | Resistance to Wage Cuts. | Either wages must bes reduced or affecting property freight rates must be increased. Resist- | ance to the former policy comes from both the werkers and railroad execu- tives. The former declare that the carriers, among other corporations, pledged themselves to the Administra- tion in 1929 to maintain wages. It may be said, however, that there was no thought then that the depression would continue for more than a year. Within three months of the Washington con- ference representatives of the Admin- istration were proclaiming that “recov- ery is in sight” The railroads also contracted to carry out a budget of im- provements involving between $800,- 000,000 and $900,000,000, or more than they had spent in good years and in spite of the fact that they had greater facilities than were required. No one can argue that they have not done their part in attempting to keep labor employed during the severest crisis ex- perienced in a decade. The disposition now is to maintain the rallroad wage scale and to increase the number of those participating in it. The Interstate Commerce Commis- sion is belleved to be sympathetic to an application for increased freight rates. Before this could be granted, however, it would be necessary to es- tablish proof that it was the only remedy of relief for the carriers, Con- sequently, it has been suggested that the commission institute an inquiry into the entire question of railroad earnings and make this its main busi- ness until a decision is reached later in the year. Effect of Cheap Money. ‘The fallacy of attempting to correct this and similar situations through the medium of lower rediscount rates is al- ready apparent. A week’s trial has led to nothing except an inflation in the prices of Government and municipal bonds and in a limited class of legal railroad and public utility obligations. ‘The investment structure which cheap money was presumed to stiffen has, in reality, shown less stability than here- tofore. With acceptances at 1 per cent, street loans at the same level, six months’ money at 134 per cent, com- mercial paper at 2 per cent and the Federal Reserve Bank of New York exhibiting a reserve ratio of about 90%2 per cent, there is no jon for ven- turing after still lower rates or a greater supply of aveilable funds. Cheap money will not revive any bond that is withering under the influence of poor earnings or a suspicion that the margin of safety of the issue is coming close to the danger line. Position of Employers. ‘The standard of living in the United States is_cne that should be main- tained. Whether it can be by those who will not work except at a wage scale that was ene IN ATLANTIC C Alexander Armstrong of Ha-| gerstown Will Preside at Annual Session. Various Problems of Finance to Be Discussed at Two- Day Gathering. ‘The thirty-sixth annual convention of the Maryland Bankers' Association will open a two-day session at Atlantic City Wednesday of this week. The ses- sions will be held at Haddon Hall, the |New Jersey resort having drawn the | annual gatherings of Maryland bankers pretty regularly for several years. The president of the association, Alexander Armstrong, will be in the | chair. He is president of the First Na- | tional Bank of Hagerstown and is one | of the best known financiers in the| State. His banking affillations also in- clude a directorship in the Mechanics' Loan & Savings Bank of Hagerstown. Mr. Armstrong is probably most wide- ly known as a former attorney general of Maryland. The head of the Mary- land association has been active in the organization for several years and held | many important offices before taking | the helm. He has always been deeply | interested in politics and in one cam-| peign was a candidate for Governor, opposing Gov. Ritchie. The program for this week's con- vention includes many prominent bank- | ers and economists, who will discuss | various problems in the banking field, | !including better management, proper | reserves to be carried, ways to make ‘g;ofl'x in spite of low interest rates, anch, unit and group banking and other financial trends. The annual| convention is always largely attended. . FORD SALES HERE . SET NEW RECORD | April Figures Claimed High-| est in History, Indicating Business Recovery. If the automobile business constitutes | the trade barometer that economists, financial writers and observers gener- | ally say that it does, the barometer in Washington is rising and clear weather | is in sight. The sale of Ford automobiles in | Washington has reached a new peak. Registration figures for Washington for | the month of April show the greatest number of Ford, cars sold in that month in the history of Fords, which runs| back for 33 years. Production figures for March set the number of Ford au- | tomobiles for that month at 100,000, | which is reported to be 10,000 machines ahead of the nearest competitor. More, | encouraging still, according to loca Ford dealers, is the fact that for the | period from January 1 through April, | more cars were sold in Washington | | tha;\gggr the same period either in 1929 | jor . Recovery on Way. ‘Those interpreting the figures, it is | explained, can draw their own con-| clusions but will generdlly agree that | the volume of sales points to the fact | that in Washington the recovery from | the business depression is on the way, | if not here, and that the person of | moderate means is not only posses- | slon of the necessary cash for & pur- | chase, but has the faith and confidence in the security of his job to undertake obligations for the balance. The un- precedented number of sales, it is | pointed out, bears this out. | Ford men generally are inclined to laugh at the Tecurrent rumors concern- ing the “change in models” and the prediction that the Ford company, b; the industry of competitors, has been | forced to contemplate sudden or sensa- | tional changes in models. The policy, of the company, it is stated, has been | to concentrate the resources of one of | America’s richest and most powerful business” enterprises on the excellence | of a distinct type of automobile, which is sold for what it is, without represen- tations that it is anything else now or | will be in the future. The success of | the policy, it is argued, is reflected in | the success of the Ford company. Increased Figures. In substantiation of this claim, 1t is| pointed out that when the long-waited | “‘Model A” was put on the market, the | Ford authorities predicted that 15,000,- 000 cars of that model would be sold. | To date, there have been between four and five million manufactured and sold, and a recent statement by Edsel Ford was that the model’s success and public acceptance indicated that total produc- tion will reach nearer 30,000,000 than 15,000,000 cars. According to the deal- ers, there is no indication of any change in policy or models. INTERCHANGE OF TICKETS | BY BUS LINES IS BARRED Special Dispatch to The Star. RICHMOND, Va, May 16.—The| State Corporation Commission has pro- hibited the interchange of tickets be- tween intrastate bus carriers operating | under Virginia law and interstate bus | carriers conducted without State or na- | tional regulation. All Virginia passen- | ger bus operators have been notified of | this ruling of the commission. ‘The matter came to the attention of the commission in hearing evidence in the case of the Old Dominion Stages, alleged to have conducted intrastate business on an interstate it. This case has not yet been utege::m by the commission. NEW YORK BANK CLEARINGS NEW YORK, May 16 (Special) — New York bank clear! Week ended May 16, $6,013,225,474. week ended May 9, $5,711,727,035.41. DRY GOODS MARKETS. NEW YORK, May 16 (Special).— Cotton goods markets were quiet today. Print clothes were quoted unchanged at 5 for 64x60s and at 5% for 68x72s. Raw silks were quiet and unchanged. tirely _different circumstances than those now prevailing in industry is a debatable question. Employers who have been able to extract good profits from their business and to pay sub- stantial dividends during this crisis would have little respect in their com- munity if they reduced wages. On the other hand, partnerships or corpora- tions that have sacrificed their own profits and whose margin of safety is ehrinking chould expect from employes a concession sufficient to maintain their busineas until times im) MARYLAND BANKERS TO MEET ITY WEDNESDAY ALEXANDER ARMSTRONG. CORPORATION REPORTS TRENDS AND PROSPECTS OF LEADING ORGANIZATIONS By the Associated Press. NEW YORK, May 16.—The following is today’s summary of important cor- poration news prepared by Standard Statistics Co., Inc.,, New York, for the Associated Press: News Trend. Expectations of a general rise in manufacturers’ prices for cigarettes, from which larg: producers would de- rive some benefit, apparently have lost their foundation. Such hopes were based largely on the announcement last month of bigher retail prices for popu- lar brands by United Cigar Stores and Schulte Retail Stores. This is nullified, however, by today's news that these re- tailers would place prices back on the previous level of two packages for 25 cents, or 13 cents each. International Paper, a subsidiary of International Paper & Power, an- nounced a news print price cut to meet similar reductions of the large Canadian producers in April. The Midsummer | catalogue of National Bellas Hess shows | raductions of 5 per cent to 10 per cent below current prices. Dividend omis- sions were made by Walworth Co. and Iron Cap Copper, while Jaeger Machine reduced the annual rate of its common stock. J The Companies. Cosgrove-Mechan Coal 1930 $7 pre- rrsn-ed share earnings, $1.43, against $6.72. Duguesne Light preferred share earn- ings, 12 months to March 31, $52.62, against $47.28. General Outdoor Advertising March quarter deficit, $650,217, against deficit $499,004 in 1930. Hecla Mining March quarter common share earnings 10 cents, against 30 cents. International Paper & Power sub- sidiary, International Paper, cuts news print price $5 a ton, meeting last I* month’s reduction by large Can: producers, MacAndrews & Forbes Co, March! quarter common earnings 56 cents, against 66 cents. Nevada Consolidated m.rch{ quarter deficit before depletion $56,995, against net income before depletion and Federal taxes $2,224,425. Pet Milk Co. March quarter deficit | $43.438, against net income $88,850, equal to 15 cents common 1930. Rochester Central Power 1930 com- mon share earnings 32 cents, against 74 cents. St. Louis-San Francisco Railway to abandon reduced 2-cents-a-mile pas- senger fare. Scott Paper declares usual semi- annual 2 per cent stock dividend, with regular quarterly 35-cent cash dividend on’ common. ‘Walworth Co. omits quarterly 75-cent preferred and 25-cent common divi- dends. Jaeger Machine cuts quarterly com. mon dividend to 20 cents from 31 cents. Pacific Telephone & Telegraph March gross off 18.4 per cent; net ai taxes Off 14.4 per cent. Three months' gross off 17.9 per cent; net after taxes off 9 per cent. American Brown Boveri Electric an- nual meeting further adjourned to May 22. Baldwin Locomotive Works acquires | five subsidiaries of Cramp Morris In-| dustrials, Inc. Borg-Warner Corporation making free-wheeling attachment for Hudson cars, offered by latter as optional equipment. Chicago, Milwaukee, St. Paul & Pa- cific Railroad—Results on 2 cents mileage rate in local territory unsatis- factory; experiment to be continued. Chicago & Northwestern Railway decided as to continuance of experi- mental 2 cents a mile fare; results thus far unsatisfactory. Detroit Edison surplus after charges, 12 {nont.hn ended April 30, off 14.6 per cent. 1 Iron Cap Copper passes preferred dividend; paid 15 cents February 16. Moto Meter Gauge & Equipment March quarter deficit $113,213, against deficit $57,395 in 1930. National Bellas Hess Midsummer catalogue prices 15 per cent to 20 per cent_ under year ago and 5 per cent to 10 per cent below eurrent prices; has added 500,000 new customers since first of year. National Cash Register—E. A. Deeds | to_be chairman of board. Philadelphia Rapid Transit—Old di- rectorate approves cancellation of Mit- ten management contract and building lease and repurchase of Market street property by Mitten bank securities at price originally paid by company; re- adjustments cut overhead charges by over $1,000,000 annually. ‘Tonopah Mining Co. of Nevada 1930 net income, $5,491, against $193,033. ‘Tri-Utilities Corporation—Oklahoma Governor orders institution of ouster proceedings against this company and American Natural Gas for alleged vio- lation of State anti-trust laws. United States Stores Corporation 1930 common share earnings 31 cents, against $1.18. Wheeling & Lake Erle Rallway $7 back dividend on prior lien stock. Cities Service Co. subsidiary to meet léfl cent gallon cut in bulk gasoline prices. Reo Motor Car—Reported planning fo offer new six and eight cylinder Flying Clouds at cheaper prices. ‘Texas Corporation subsidiary posts East Texas crude prices ranging from 43 cents to 87 cents a_barrel. General Theaters Equipment—Has devised new camera and projector per- mit handling of any width motion picture film to 70 millimeters. Fox Film—Debenturé underwriting syndicate reported dissolved; members R SILVER QUOTAYJONS. YORK, y 16 (P). and un:‘glued at 24 sl CHICAGO 1S FACING CRISIS AS CITIZENS STAGE TAX STRIKE More Than $174,000,000 Left Unpaid From Total of $274,000,000. CERMAK CALLS BANKERS TO HELP SOLVE PROBLEM Situation Has Grown Out of County Assessment of 1927, De- clared Illegal. BY JOHN F. SINCLAIR. CHICAGO, May 18 (NANA).— Chicago is up against the most serious crisis in her picturesque career. The people have revolted en masse agatnst paying their taxes. This “tax strike” is no minor affair either. It is not being evaded by a few inconsequential persons, but by hun- dreds of thousands of respected citi- zens. It is a social and financial revolu- tion—nothing less. May 15 was the “last day” to pay 1929 taxes in Chicago without penalty. The amount levied was $274,000,000. The citizens paid less than $100,000,000. Think of it! More than $174,000,000 in tax deliquencies in one year's as- sessment! ‘Without Precedent. This has never happened before in any large American city. Her ess. men are alarmed. People are going about saying very little, but keepi the money due on their taxes—if they have any—in their pockets. One cannot see how the situation .could be worse. It is a complete mess, and every citizen is vl"llgl interested in the question of how Chicago is to work it out. But that's not the whole story. It is not even half of it. To understand fit, one must go back and the back- ground. Cook County, of which is the center, assesses property for tax purposes every four years. It did so in 1927. ‘Then the Illinols Supreme Court de- clared the assessment illegal upon the ground of fraud. The State Tax Com- mission took 18 months to levy a new assessment, o that no taxes at all were paid in 1929 in Cook County. $50,000,000 Still Unpaid. But on June 10, 1930, the 1928 taxes were made due, with the delinquency date September 15._ The total tax levied for Cook Counfy was $219,000,000. Of that amount over $50,000,000 is still unpaid, in spite of the fact that 29,000 parcels of real estate were sold for taxes and 59,000 parcels of land were put Gp on which no bid was re- ceived. There were 332,000 individual of land subject to tax forfeiture. All this happened in the days before the stock market crash. The 1929 taxes, amounting to $274,- 000,000, were due last Priday, and less than 40 per cent were paid. The 1930 assessment, which has been set at $284,- 000,000, is' due on December 31, mext, but not a thing has been done about its_collection, In a word, Chicago’s tax for 1931 amount to over $550,000,000. As things stand today, the city will be lucky to get $150,000,000 out of it. Sold Tax Warrants. But Cook County, which is really Chicago, must have money to carry gn. Up to this time it has had money, even though taxes were not paid. How did they do it? Simply by sell- ing tax warrants to banks and investors up to the amount of the taxes levied— or nearly so. That is to say, that even though cnly $100,000,000 of the 1920 tax has been paid in as taxes, the city has already received the $274,000,000 which was due. She has spent it all, and she is now spending the 1930 money, which she re- ceived from tax warrants put out in anticipation of the 1930 taxes. ‘Who own these tax warrants? Largely the banks of Chicago, which have taken them as the only way to meet the problem facing the city. If the city of Chicago—or rather Cook County—is able to collect only one-fourth or one-fifth of the amount due this year, the warrants outstanding will have to be carried by the banks until such time as the money from taxes, or from some other source, be- comes available. Expect Crisis Soon. And that's the rub now. The taxes are not coming in. The banks cannot g0 on indefinitely piling up more non- liquid securities of this character in their assets. They know it. The citi- zens know it, and every one expects the crisis will be reached in the next few weeks, if not before. bankers of Chicago have been asked by Mayor Cermak to consider the crisis and to see what should and can be done about it. They are to meet Monday afternoon, If the banks refuse to buy any more warrants, in view of the tax strike, then the city and county government will break down. For salaries, to carry on will not be forthcoming. This includes schools and all forms of governmental activity, such 25 police, fire, saniary board, waterworks, etc. John M. Pratf, executive director of the Association of Real Estate Tax- payers, who is advising the taxpayers of Chicago not to pay their 1929 tax upon the ground that it is illegal, says that “the 1929 tax on the basis of the pres- ent assessment will never be collected.” Mr. Pratt contends that it is not only unfair and illegal, but actually con- fiscatory. Says Tax Must Be Paid. Silas H. Strawn, recently elected president of the United States Chamber of Commerce, who was chairman of the Citizens’ Committee, which provided the funds last year to carry on, when asked for his opinion as to how the crisis is to be met, sald: paid. There is no perfect madness to hly, the lines are drawn between ct groups—the real estate owners, led by John M. Pratt and many large real te taxpayers, on the one hand, and Silas H. Strawn, Melvin A. Traylor, president of the First National Bank, and their associates, re&munfinl the banking groups, and the larger business interests of the city, on the other. ‘What the final outcome will be mo one can predict, but that is now face-to-face with the test strike in her entire history—f tax News- alternative. It is think otherwise.” strike—no one will deny. (Copyright, 1931, by