Evening Star Newspaper, December 13, 1931, Page 73

| News of Markets Pages 1 to 4 FINANCIAL AND CLASoirieD . he Sunday Sta = Part 6—12 Pages WASHINGTON, D. - C., ‘BUNDAY MORNING, DECEMBER 1931. a9 Oy Classified Ads Pages 3 to 11 LOCAL INVESTORS 10 GET §1.500000 AT GLOSE OF YEAR Exchange Secretary Sums Up Disbursements Due on D. C. Securities. ADD NEARLY $200,000 lecretpry Mellon's Predictions for| 1932 Held Significant by Washington Bankers. BY EDWARD C. STONE. More than $1,500,000 in interest and dividends will be distributed to Wash- ington investors on January 1 from securities listed on the Washington Stock Exchange, according to figures com- piled by Y. E. Booker, secretary of the exchange. 'Mr. Booker, who heads the investment firm of Y. E. Booker & Co. states that besides this amount. there probably will be from $150,000 to $200,000 additional payments in inter- est and dividends distributed on local securities which are not listed on the Washington Exchange These payments of well over $1,500,- 000 to local investors are considered highly significant from an investment standpoint A considerable portion of the money doubtless will be reinvested in local securities, since past history shows that there is always a consid- erable increase in demand for local bonds and stocks during the mont] of January. A certain percentage o the funds will also have their effect in_strengthening local trade. Members of the local exchange are pointing with pride to the record of the past vear. A comparison of the price range and dividend records of the local securities with those listed in New York and on other exchanges leaves little cause for complaint on the part of investors who have con- sistently kept the greater part of their funds in home securities. With one or two exceptions no such shrinkage in value has taken place here as has been recorded on exchanges elsewhere. Local Dividends Maintained. Interest on local bonds is of course playing a very important factor in the coming $1,500,000 disburéement. Prac- tically all the Washington banks are paying the same dividends as last year, although some small extras may be omitted in one or two instances. The utility stocks have ajso added their share of the investment returns during 1931, most of the year-end payments having already been voted. ‘The miscelleaneous list of the Stock Exchange is contributing generously to the total. In this list are Mergenthaler Linotype and Lanston Monotype. While the plants are not located here, yet the stocks are widely held locally snd ‘Washington is always well represented on the directorates. Local bankers yesterday stressed the im- portance of the coming payments. It is the belief here that the approaching in- terest and dividend payments all over the country will total a sum which may prove the turning point in the whole investment situation. The re- investment of so much money should have a marked effect on 1932 trends, bankers assert. Depression’s Greatest Need. The present depression should go down to_posterity as “The Great Gold Mystery,” says Prof. Irving Pisher of Yale in Trust Companies Magazine. For when gold is abuncant it really ought to be cheap and boost prices. But, in Prance and America, it iS abundant yet dear, downing prices and booming the | gold mines. We shall find the solution, | 1 believe, in the colossal volume of pub- lic and private debts “As to the technical attack on defla- tion. the FPederal Reserve System should, I believe, have continued its open market, operations, namely, buying bonds. Other technical expedients are also available. To turn this depression we need just what England needed, and what she has recently secured, a rise of the price level and we can secure this without cutting loose from gold. To rase the price level to normal and then keep it there should be the great object; in other words, to take the swell- ing out of our hypertrified dollar and to stabilize it."” Mellon Sees 15 Per Cent Gain. Secretary Mellon’s annual report Congress which voiced the assum that definite improvement in general conditions in industry and trade will be witnessed in 1932, aroused unusual in- terest in local banking circles. In am- plification of the statement, it was said later that the Treasury Department ex- pects an increase of about 15 per cent in industrial production next year. It | was fi said that there is usua sic improvement in business ns before they are evident in bankers feel that Secretary Mellon's forecast is far more important than most predictions of the kind, be- | cause of the sources of information | which the Treasury has at hand and | also because of Mr. Mellon's keen per- ception of business and financial condi- tions. In the Summer of 1929 Mr. Mel- lon casually said. “It is a good time to buy bonds.” It was He may now have just as good rea- gons for predicting business improve- ment in 1932, Yesterday's Exchange Trading. Business on the Washington Stock Exchange yesterday was more active than usual at the end of the week. The sales Washington Gas 55—$1,000 at 1001, { $1,000 at 100%;, $1,000 at 100%, $1,000 | at 100, Washington Rwy at 85 Vashington Gas 6s apital Traction Co. 10 at 21, 10 at 21, 10 at 21, 10 at 21, 6 at 21,5 at 21 Washington Rwy. & Electric pfd.—25 at 933, Lanston Monotype—4 at 67, 86!., 8 at 663 Mergenthaler Linotype—10 at 5915 National Mtge. & Inv. pfd.—100 at 83, 56 at 33, 44 at 3% The small sile in Mergenthaler Lino- type established a new low for the year. Capital Traction . closed fractionally above its recent low. Lanston Mono- type sold the lowest it has this year and closed !4 point higher The day’s quota- tions were practically unchanged. TAKES NEW NAME. NEW YORK, December 12 (Special) A"—$500 at 103 5 at 21, 4 at 21 10 at | & Elec. 45—$1,000 | | told JUDGE PROVES G Detroit Jurist Advises Insti- tutions to Confide in Their Depositors. Has Made Record in Restor-| ing Financial Health to | His “Patients.” | | BY E. A. BAUMGARTH. Special Dispatch to The Star DETROIT, December called on his patients week and found them doing splen- didly and quite happy. This would be a felicitous experience for any phy- sician, but when the patients happen to be sick banks—in t times—the s more than out of the ordinary. Tt is astounding And ‘still more astounding, because of its simplicity, is the prescription On each bottle it is printed, not in pharmacists’ Latin, but in the plain- est of English—'Take the depositors into your confidence.” The doctor is Judge Arthur J. Lacy, Detroit. His patfents, now very ro- bust patients, indeed, despite the blow the economic depression dealt indus- trial Michigan, are the First State Bank of Milford, Mich.; the First Na- tional Bank of Rochester, Mich. and the First-Peoples' State Bank of Tra- verse City, Mich., which Judge Lacy helped to make out of the First Na- tional and the Peoples’ Savings Banks of that city 5 And there are more patients coming to his office door. Just here it may be mentioned, to give it the emphasis due, that Judge Lacy believes two-thirds of five-sixths | of the banks that have failed in the United States could have been saved, 12—A doctor one day last OOD “DOCTOR™ IN ATTENDING AILING BANKS ____ JUDGE ARTHUR J. LACY. without the loss running into hundreds of millions that has ruined whole com- munities. The first bank which called on Judge Lacy was the First State Bank of Mil- ford. It was not unscund, but banks |all around it had begun to slip, and | & panicky feeling was abroad. sets had become “frozen.” Both capital of $25,000 and & surplus of $70,000 were intact. A clause re- quiring 60 days' notice before with- drawal had been put into effect, how- (Continued on Fourth Page.) Tt5 as- INCOME TAX YIELD MAYBE CLRTALED Extent of Business Depres- | sion Will Affect Return on Levies. BY BRADLEY W. TRENT. Special Dispatch to The Star. NEW YORK, December 12—Wall Street’s reaction to the new tax pro- posals of Secretary Mellon, which he hopes may become effective from Janu- ary 1, is that the proposals, in effect, | the 1924 schedules, are as good as may | be expected under the circumstances. | 1t is thought that if the Treasury can | obtain enactment of the plans into law | in the present Congress in time to get needed funds, a more extended tax pro- | gram may be devised subsequently. It is recognized that the new excise taxes are arbitrary, in the sense that they bear upon certain classes of manufactured goods while letting others escape, but their trend is toward luxury goods. It is recognized also that while the ‘Treasury has widened the list of those | who will pay income tax, it also has in- | creased the burden upon large incomes, s0 that the income tax will remain as it has always been, a class tax, the bulk ol; which is paid by a small percentage of the population. Increase in Taxpayers. In some quarters there is a disposi- | tlon to question whether Mr. Mellon's estimates on the yield from the income and surtax in the next two years will be anywhere near equal the actual yield, since the income tax is so responsive to the business *situation. According to Treasury figures 5,518,310 persons paid the income tax in 1924, which in that year yielded $1.075000,000, while in| 1928 about 2,523,063 persons paid taxes | on incomes, which yielded in that year | $1,204,000,000. Uncersecretary of the | Treasury Mills in an address made last | May stated that while 2,500,000 paid in- | come taxes, 87 per cent of the amount | paid was collected from 380,000 persons. | The half of 1 per cent larger income tax on corporations is characterized as a straw laid so gently upon the camel's back that it will not quite break it. It is not quite so severe as the 13 per cent rate of 1926-27 nor as pleasing as the 10 per cent which was levied on corporate income in 1920 and 1921 The principal interest in the financial district in the tax program proposed by Secretary Mellon appears to be in the | probable vields of the new excise taxes | and Increased old taxes. In the case of | the bank check tax no reliable esti- | mates can be made, for such a tax has not been in effect since Spanish War days Other Taxes. The increase of the rate on tobacco products probably will be productive in 50 far as it applies to cigarettes, which are now contributing the bulk of the tobacco taxes, but for some time the Tregsury has felt the limit of return on cigar taxes. The r admissions taxes in 1924 yielded the fairly respect- able sum of $77,712,524, and it is not improbable that by making all admis- sions over 10 cents taxable the Treasury | may make this tax much more produc- tive. The new tax on telephone and | telegraph _messages may than the $34,662,429 brought in by simi- | lar taxation in 1924, but letter writing | rate should be raised. The .sales tax| upon automobile manufacturers doubt- ' less will be the most productive of the new miscellaneous levies, since this kind | of impost in 1924 produced $200,921,721. | (Copyright, 1931.) | GASOLINE CONSUMPTION DECLARED ON INCREASE By the Associated Press. The Interior Department has been | that gasoline consumption per average motor vehicle in use is con-i tinuing to increase despite a decreased number of vehicles. The Volunteer Committee on Petro- léum Economics, which made this re- port, said the demand for motor fuel Wwas 2 per cent greater in the third quarter of this year than in the cor- responding months of 1930. This condition was brought about in part, it was said, by the increased use |of taxicabs. The average taxi, or stock automobile converted to “hire use,” will consume annually from 10 to 15 times as much gasoline as the average priva automobile, it was claimed. The num- ber of taxicabs operated in the United ~—Starting with its forthcoming Janu- ary issue, Electric Railway Journal will be known as Transit Journal, it has just been announced here by the McGraw- Hill Publishing Co. The publication, which 15 & monthly, was founded in 1884 as the Street Railway Journal and was devoted originally to horse-drawn sireet oar transportation, States last Summer was reported as approximately 140,000, as compared with 115,000 a year ago. For the nine months from October 1, 1931, to June 30, 1932, the committee estimated that the domestic motor fuel demand will amount to 289,000,000 bar- rels, an increase of 1.%.per cent over the previous | amounted to about a cent, Retail Sales Gain During Week Laid To Holiday Buying By the Associated Press. NEW YORK, December 12.—Retail sales showed a further improvement during the past week, according to the weekly survey by the Fairchild Publi- cations. Aggregete sales, however, con- tinue below the corresponding period in 1930. December sales to date show a decrease of about 10 per cent under December, 1930, as compared with a decrease of 15 per cent in November as compared with November, 1930. The decrease in retall prices is estimated at about 171, per cent below a year ago, indicating a greater movement of units. The improvement in sales was due to holiday sales and more seasonal weather and also lower prices. Buying of wearing apparel has been on a slightly larger scale than the usual pre-holiday volume. It has also been influenced by the lower price trend. Retsil prices have shown very little improvement in December. The trend is still downward, GRAIN PRICES DROP AS STOCKS DEGLINE Market Unsettlement Emphasized by British Plan for Import Quota System. BY JOHN P. BOUGHAN, Associated Press Market Editor, CHICAGO, December 12.—Affected anew by breaks in securities, the grain markets averaged lower today. The trade, however, generally regarded wheat as having given an excellent account of itself under the circumstances. A mod- erate export business in North Ameri- can wheat was noted Wheat closed irregular, 1; cent lower to Ysal higher, comparéd with yester- dny: finish; corn, 3a% down; oats, unchanged to ¥, up, and provisi - changed to 5 cents down. o 1B Unsettlement of the wheat received additional emphasis owing to further notice taken of British govern- ment plans for a quota system of im. ports and because of figures showing that the United States since July 1 has fallen short 10,000,000 bushels in wheat exports compared with a year ago. This showing as to meagerness of United States wheat exports was potwithstanding that the total last year had been unusually small, A leading ‘rade authority contended, however. that Whether United States exporters would Weaken their prices depended largely on domestic crop prospects, which at pres- ent were not good Rallies in wheat after the market ha cents. The recovery, market values took place d fallen about 11, which at one stage was simul- vy rains in alns were said to be delaying wheat harvest operations ae well as causing damage to the quality of the crop. Corn and oats averaged lower with wheat, Provisions were WHEAT— December . taneous with reports of hea Argentina. The ry neglected yield more | u will be encouraged, even if the postage | }&7 STOCK EXCHANGE SEAT NOW QUOTED AT $129,000! By the Associated Press | NEW YORK, December value of New York memberships today dec est level in six years Arrangements Were made for the sal of a seat at $120,000, a drop of 36 a0q from the previous sale. ¢ It was the fourth time this that the value of exchange memna ships has declined to new low levels for recent years. December 3 a seat was sold for $148,000, and the following day two memberships sold at $136,000° any {$135.000 Tespectively, the lowest since | 19: Wwhen the price ranged fro, - 000 to $175,700. S Today's sal”, however, broke thi the low for that year and carrien he | quotation to the lowest lovel since 1925 when memberships touched $99,000. " 12.—The Stock Exchange lined to the low- NEW SALES MARK. A new record for volume of tuel ofls was made in November 1o cu sidiaries of National Service Compan. les total sales for the month being 3,384,121 gallons, an increase of 72 per cent over November, 1930, STOCKLIST DROPS TO LOWEST LEVEL FORBEAR MARKET Averages Are Nearly 10 Points Under Bottom Prices for October 5. OMISSION OF RAILROAD DIVIDENDS CONTINUES Fears Over Foreign Situation Also Prove Factor in the Decline. BY CHARLES F. SPEARE. Special Dispatch to The Star NEW YORK, December 12.—The de- moralization in stock and bond prices this week has been promoted by the radical changes in the dividend poli- cies of such railroad systems as the |New York Central, New York, New | Haven & Hartford, and Missouri Pa- | cific, and, in the absence of any clear view of the German situation, by a | willingness to accept as fact the most extreme views expressed on the for- | eign situation The public has been selling securi- |ties regardless of values and from | fright induced by the steady decline in | prices, which for stocks are now at |an average nearly 10 points lower than in October, and for bonds at the min- imum of the post-war period The ‘“high visibility” attached to the daily quotations of listed securi- tles undoubtedly reacts in such a time on the investor, who is given little encouragement by any sign of bank- ing leadership to believe in the worth of his securities. His judgment is in- fluenced almost entirely by the action of the market. His business opera- tions cohtract as the depreciation in his stocks or bonds increases. His guide is the ticker. This has led him into a wilderness where his former faith in the fundamental values of American corporation securities strug- gle with a fear for the financial in- tegrity of all institutions, Street's Position Liquidated. It is not Wall Street selling that has undermined values so much re- cently as liquidation by those who have for years owned and held se- curities for their own account or as guardians for others. The Wall Street position is quite thoroughly liquidated. This is apparent from the decrease of 90 per cent in brokers' loans since Oc- tober, 1929, even though it reflects to a considerable -extent the 80 per cent decline in stocks. meanwhile. 1In 1929, at the peak of the market, one Stock Exchange house was borrowing $275,- 1000,000, & second $250,000,000 and a { third $200,000,000. This week the bor- rowings of the first had been reduced | to $35,000,000. Those of the other two were, respectively, $15,000,000 and $5,- 000,000 Deflation in loans in the same rela- tve degree has taken place where for- merly there were large speculative com- mitments. There has also been a notable reduction in the loans against securi- ties carried by thc banks, though this has probably not yet reached the culmi- nating point. Crisis in Bond Market. The critical situation is in the bond market. This enjoyed little recovery a month ago, when stocks moved up from the October prices. The same is true of preferred stocks, especially those of pub- Hc utility corporations. The persistent. liquidation of these higher grades of | securities, whose margin of safety for | interest or for dividends has undergone iume change in the past three years, the most sinister and mystifying aspect of the entire market position. It has no relation to the usual factors in a de- cline, such as high money rates or an oversupply of new issues. Corporations that must borrow in the next year or two apparently are con- tent to see their securities selling on an 8 10 10 per cent basis and at prices that represent discounts of 30 to 50 per cent, from those at which they have provided themselves with new capital in the last 12 months. It is not surprising that the small investor should be bewildered and afraid when those who are supposed to know all there is to know about individ- ual securities make no effort to support {even the very best of them. | Some hope was held out at the end of | the week of a favorable conclusion of | the conferences in Chicago of the rail- | road brotherhoods. It was believed that a concession to an emergency condition would be made in the matter of wages. The groups specifically involved in this controversy have had a reduction of 21 per cent in the numbers employed since 1929. At the same time the mainte- nance-of-way and equipment forces | have been cut down 30 per cent. The | state of the second group, therefore, ! ¥ith less employment an da much small- Ier average income, is much worse than that body of men who are resisting an adjustment in wages and have inti- mated that they will oppose a cut so long as the carriers continue dividends. | There already. have been about 35 roads | that have been compelled to reduce or | omit payments on stocks in an amount involving nearly $200,000,000 of the 1930 | disbursements. Tax Selling Increases. A There has been some increase this week in the offerings of stocks identified with corporations whose products are to be taxed under the proposed schedule and from which revenues in the first half of the calendar year are estimated at $205,000,000. More serious, however, has been a repetition of what has been witnessed in the closing months of the last three years; namely, selllng of securities to establish losses against in- come tax payments. This pernicious and uneconomic privileg> given by law to those who have a depreciation in real one of the prime factors in creating the loss in rflefiue from which the Govern- ment is now suffering, and to offset which it is compelled to establish a new schedule of tax percentages on personal and corporation incomes. The report of Secretary Mellon indi- cates that the difference between the profits reported on net incomes of $5,000 and over in 1928 and the losses in the same brackets in 1930 was $4,230,000,- 000. The profits last year were offset by losses permitted to be ("vfl'ken under the so-called “capital profit” tax. Not only does this provision in the tax law permit wealthy individuals to avoid pay- ing their share of the Government ex- pens2, but it repeatedly leads to de- moralization in the market for securities. In times like the present it adds fuel to a fire from which few individuals or corporations are escaping unsinged. If there is justification for such an element in the tax laws, it has not been so interpreted successfully by Government representatives. If anything, the suggestions for in- creased income taxes are too moderate. They do not go deep enough into the immediate necessities of the Govern- ment, which hdd & the last estate or in stocks and bonds has been | SLRE, MR SINCE\ W HAVENT QA diam, LIWED \N T EVER AS BORM, o To (Copyright, 1931.) €5, BLUILT YEARS AGO. FI\VE ROOMS AND NO BATH / U. S. DEFICIT FOR BY. CHAS. P. SHAEFFER, Associated Press Business Writer. The deficit for the fiscal year ending June 30, 1932, will be $2,089.000,000 if the present ratio of expenditures and receipts is maintained during the re- mainder of the period. The estimate of the Treasuey Depart- ment for the same period places the excess of expenditures over receipts at $2,123,000,000. There are 307 business days in the present fiscal year. The latest daily report of the Treasury Department, for December 9, shows an excess of ex- penditures over receipts of $925,000,000. This is at a daily rate of $6,804,008 a- there were 136 business days expired during the period. The present fiscal year contains 366 days, of which 52 are Sundays and 7 are national holidays. Government receipts for the year to date have been about 25 per cent less Sithan the corresponding pericd of last yeal, while expenditures, on the other FISCAL YEAR MAY AMOUNT TO $2,089,000.000 hand, have risen about 20 per cent. | “The principal factor in the loss of | revenue has en a falling off in tax receipts from individuals and corpora- tions which are subject to wide fluc- tuation in accord with the changing | volume of trade and personal income. | | Virtually all other forms of receipts also show declines. Expenditures, off the other hand, have continued the rising scale begun’ several years ago. Theseé include a number of | 2xtraordinary appropriations, comprising | disbursements as follows: To the eral Farm Board; to the Department of Agriculture for , road building and drought relief; tosthe Veterans’ Bureau | for liberalized provisions to war vet- | erans; to the War Department for rivers and harbors, flood control, for the Air | Corps, and to the Treasury Department for the Government's public building program. | These factors, combined, promise in the year, the largest deficit ever incurred by any country in peace iimes. COTTON VALUES OFF UNDER LIQUIDATION Week End Selling Results in De- clines of 5 to 9 Points. Close Steady, By the Associated Press. NEW YORK, December 12—The cotton market was generally Jower today under week end liouidation and some local and Southern selling, promoted by easier Liverpool cables and the unsettled ruling of the stock market, After sell- ing off to 6.02 at the start, January rallied to 6.07 on covering, but later eased off to 5.99 and closed at 6.00 with the general market closing barely steady at net declines of 5 to 9 points. High. Low. Close. 596 597 6.00 618 December . January October . EARNINGS REPORTED. NEW YORK, December 12 (/P).—Per share earnings of corporations report- ing this week, with comparisons with last year, include: Twelve months, Sept. 30. American Commonwealths Fower (combined A B) v American Powe, Ligl t, 1931, 30.66 LU Continental Gas & Elect, $7 pfd, 24.32 Twelve months, Oct. 31, Electric Bond & Share.. 148 Tampa Electric ... 1111111 267 Nine months. Sepf. 30 International Telephone & Tele- graph Six months, Oct. 31."""" Truax-Traer Coal. .., 1930. 5168 410 2752 2.54 270 103 188 ot g i R R fiscal year of $902,706,845, and is now preparing to deal with one of $2,122,- 683,685 in the current fiscal year. The present burden of the American tax- payer is from State and local levies and not from those by the Federal Govern- ment. In the proposed income tax re- vision, married persons with net incomes of $3,000 would pay a tax of $1.50. Sin- gle persons with no dependents are taxed $15 on a net income of $2,000. In the new British budget enacted last September a married couple with an earned income of $3,000 is taxed $140, while a single person with an earned in- come of $2,000 pays $165 of this over to the government. In the $5,000 net in- come bracket here, married persons would be assessed $31.50 compared with $540 in Britain. The $25,000 American Income producers would be assessed $1,405 against $7,325 imposed on their British cousins. So it will be seen that the burden of the American taxpayer is still light. Then again, he is not likely to wake up some morning, and, as happened in Germany this week, find that the gov- ernment has arbitrarily reduced his sal- ary 10 per ecent, his rents, as a land- lord, 10 to 15 per cent,-and as & bank- er, his interest and 50 per cent. (Coprrisht, 19813 « g1 %i 9 | await announcement of first quarter rates by-as much as 25 STEEL PRODUCTION . IN FURTHER DECLINE Slow Demand Results in Reduction of Mill Activity to 27 Per Cent of Capacity. | By the Assoclated Press. NEW YORK, December 12.—The | usual seasonal slackening of demand | for steel at the year end was further accentuated this week by the appear- | ance of irregularly lower prices for some products, and the trade is now generally marking time. As a result of the slow demand, in which hoped-for increases in auto- | mobile specifications have mnot come up to trade expectations, steel ingot production declined to about 27 per cent of capacity in the past week. Buyers | are cautious since price concessions | have become available on a number of | items, and there is now a disposition to prices. Owing to low inventories, the trade is hopeful that a pent-up demand will account for improvement after the |turn of the year. Some improvement |in demand for pig iron was reported, | but this was not general. Prices are | steady. The copper market remains quiet. Pending final results of negotiations among world producers to regulate pro- duction, buyers are limiting purchases to small lots. Foreign demand is, checked by the premium asked over the normal domestic parity as a result of concessions which are available in the home market. Customs smelters are offering electrolytic at 61% cents for delivery in the Connecticut Valley, while producers are asking 1-40 higher. Tin has fluctuated irregularly, with prices largely nominal, and changes in- fluenced by the movement of sterling ex- change. Importers are not inclined to| | press offerings at current low levels, while buyers show little or no interest. - NEW YORK BANK STOCKS NEW YORK, December 12 (Special), —Bank and trust shares declined today as selling in this group increased, Brooklyn Trust at 197 was off 3, Central Hanover 116, off 3; Chase Na- tional 28%, off 1%; Chatham-Phenix 20, off 1% ; Chemical 263, off 1,; Na- tional City 39%, off 1; Empire 21, up 1; First National 1950, off 20; Guaranty 255, up 1; Irving 17%, off 7; Manhat- tan 29%,, off % ; Manufacturers 311, off 1 Title Guaranty & t 68, off 1. The following were unchanged: ental zté'/szo; change, nental, ; Corn Ex York Trust, 78. Gold Exports $625,000. | INVESTMENT BOND - DEMAND 1S SMALL Market Sinks Further During Week on Extremely Light Offerings. Special Dispatch to The Star. NEW YORK, December 12—With & 3-point decline in the price level of the bond market this week, a further de- preciation of $750,000,000 on the $50,- 000,000,000 par value of bonds listed on the New York Stock Exchange was in- dicated. The week culminated in the heaviest volume of offerings with which the exchange has had to cope this year, and the pressure apparently will con- tinue until the December tax selling is ended. Every group of bonds shown by Standard Statistics' index of 60 bonds was at a new low as the week closed. Twenty industrial bonds showed a drop of 2.2 points. Twenty railroad obliga- tions were 4.8 points lower. Twenty utility issues were off 238 points and the 60 issues together were down 3.1 points, Buyers Are Few. Investors brought large blocks ef securities to the market, only to find gaps of 10 to 15 points between bid and asked prices. This had the effect of increasing the desire to sell—a sign of hysteria. Many snapped up the chance to sell at lower prices, as it would mean writing off larger sums on their income tax returns. The bond ticker printed endless quo- tations of issues offered at a certain price., These prices were reduced hour lafter hour, some of them as much as 10 to 15 points before a sale was effected. One issue, for instance—Boston & Maine 55 of 1955—was offered to the amount of $5,000 at 68, then at 67, then at 66 and so on until the price reached 61, at which level g sale was made. This represented a net decline of 197 points in a bond still legal for investment by savings banks and trust funds in New York State. This went on throughout the list, not only in rail bonds—many of which are at record low prices—but in industrials and utilities. The omission of dividends by the New York Central, the New Haven, the Missouri-Pacific and other railroads and by industrial corporations, rumors of strike threats growing out of the wage conference at Chicago, political controversies accompanying the recon- vening of Congress and proposals of higher taxes added momentum to the selling. As the week ended more constructive reports appeared. Washington, follow- ing President Hoover’s statement on for- eign policy, decided to call representa- tives of the large American banks to clarify America’s private and public position in regard to foreign debts. The New York State Joint Committee on Banking agreed to submit a proposal to the Leglsluture to consider all rail bonds legal that held such status on January 1, 1931, except in the case of roads that went into receiverships. Foreign Situation. ‘The situation abroad continued to hold attention. Britain took some heart Chancellor Chamberlain's promise that there would be no British budget deficit this year, and on Friday the London market had a better tone after churian negotiations, with possibly a more obstinate stand on Japan's part] as an outcome. South American dollar bonds moved listlessly. Neither the general trade situation, which in November showed | there FOREIGN BUSINESS OUTLOOK CLOUDED BY TARIFF TANGLE Threats of Economic War Continue to Obscure Financial Prospect. UNCERTAINTY OVER DEBT CONFERENCES PERSISTS Political Factors in Germany and Elsewhere Exert Influence on Markets. Special Dispatch to The Star. NEW YORK, December 12.—Cable and radio dispatches to The Business Week give the following survey of busi- ness abroad for the week ending today: Europe.—The immediate prospect of & tariff war in Europe, uncertainty over the debt conferences and German re- action to the dictatorship dominate the European outlook. Britain and France are at loggerheads over the tariff. Central Europe finds it necessary to eo- operate. Austria and Hungary will be forced to declare moratoria early next year. France is building Japanese friendship. Attention in the coming week with focus on events at Basel, Ber- lin, London and Paris, Paris.—Business is contracting, unem- ployment increasing, unfavorable de- velopments multiplying. The general trend is indicated by the further 10,000 increase in the week’s registered un- employed, by falling wholesale prices in splte of rising tariffs, by severely re- stricted Christmas buying and: by financial paralysis resulting from the expansion of domestic discounts. N London.—London is frankly worried this week. The causes are numerous. Outstanding were the continued weak position of sterling and the growing realization that January tax demands are spoiling Christmas buying. Looming in the baekground was the fear that the Lancashire textile workers would carry out their threat to strike January 1 un- less owners agree not to lengthen hours and reduce wages. Backed by 200 trade associations and flaunted from 4,000,000 posters, the “Buy British” campaign still is hol popular interest and bringing profitable results. Berlin.—With internal political tension nearing the boiling point, and with the attention of business focused on Basel and the coming short-term parleys in Berlin, daily announcements of new failures and losses are spreading de- spair—Hitler's best ally. Election of Signor Beneduce to head the experts’ mesting at Basel satisfies Germany and is taken as a good omen. Apart from & further decline in a wajority of the general business indicators, the week’s ill tidings include the announcement of an operating loss by A. E. G., with sales off 30 per cent from 1930 totals; & temporary shut down at the Henschel Co.. the country’s largest locomotive builders; the disastrous effect of the British tariff on the knitted wear in- dustry, which is largely dependent on exports to England, Mills are already sustaining a loss of $10,000,000 in orders yearly and have been forced to dismiss 18,000 men. BRITISH TARIFF MOVE. Government Will Investigate Possi- bilities of Customs Union. BY LEONARD J. REID, Associate Editor of the London Economist. Special Cable to The Star. LONDON, December 12.—Parliament has adjourned until February 2, giving the executive division of the govern- ment a welcome breathing space for consideration of many unresolved problems. On the prime issue of fiscal policy, the protectionist pressure, notably from the steel industry, has been momen- tarily withstood on the understanding that the cabinet will make a general pronouncement of its tariff intentions on Parliament’s resumption, when, failing evidence that progress has been made toward an international under- standing which would establish a basis for freer trade, the demands of the tariff interests are likely to become irresistible even to the point of threatening the resignation of non- conservative ministers. These circumstances have reinforced the need of the government to initiate conversations exploring the swpport likely to be given to a wide low-tariff customs union. It will be desirable also to prepare the ground, for an international monetary conference. Be- fore this is done the government must decide what wholesale price level would be most appropriate for this country. (Copyright, 1931) DRIVE FOR El:ECTRICAL HOME LIGHTING URGED By the Associated Press. ‘The use of light in about 21,000,000 homes now equipped with electricity is said to be less than one-third of the illumination level indicated by good practice. ~The electrical world es- timates that home lighting saturation is not over 30 per cent, while other - estimates have placed this figure as low as 17 per ceni. On the basis of 30 per cent, and energy market estimated at around 24,000,000,000 kilowatt hours, which at present rates would return more than $1,000,000,000 in annual revenue, is available In this unsaturated field, the publication asserts. The analysis deduces that if one-third of the homes should put in adequate il- lumination, their requirements would add at least $250,000,000 yearly gross to utility revenues, and would provide an additional market for lamps, fix= tures, wiring, etc, of about $490,000,- 000, besides calling for the expenditure by the utilities of some $500,000,000 for station, line and distribution capacity to serve the business. A united campaign by the electrical mdafiry for better home lighting was urgt / Tax Selling. NEW YORK, December 12 (Special). —The experience of other years has been that to establish tax losses dries up after the middle of December. Under the 30-day repurchase clause was formerly considerable buy- ing at the end of December of stocks that had