Evening Star Newspaper, March 5, 1933, Page 2

A2 x THE SUNDAY STAR, WASHINGTON, D. C, MARCH 5, 1933—PART ONE. ALL STATES ORDER BANK SAFEGUARDS Financing at Standstill as U. S. Leaders Map Speedy Action. Cent—Britain a Roosevel By the Associated Press. LONDON, March 4—Extension of (Continued From First Pace) | rds- | a. where Nationai Gua am H. Murray's ; proclamation on the of the last States tions, Gov. Pol- ration w and tion was ion of the ew ters of s have al ce liday 1 sa he saw liday in view of ng banks to close ; to the Corpo- usiness in gen- t cash for se. Al- ss n €xpe b curtailment fes. argest ly, in riets of ¥ h grain mar transactions iler Live d stock &1 s chief trouble f cashing extended household ary. financial was said, be possible for the $40.000.- 000,000 in Ameri banks to be with- drawn suddenly in cash. banks repor Reserve Bun 1g to the Chicago Federal the stated withdrawals total- | the American banking holiday to the powerful institutions of New York came as something of a shock to Europe, and even the experts were puzzled as to | the course events will take. American tourists found themselves | theoretically broke when the banks | halted transactions in dollars, but they were able to get money from the hotels | and the tourist agencies. | Roosevelt Alds Confidence. Lloyds offered 5 to 1 that the United States will still be on the gold standard on June 1. Insurance against abandon- ment of gold before that date was quoted at 21 per cent. Tue Roosevelt inaugural message, trencmitted across the ocean scemed to | ore confidence to a considerable de- | America need have no fear for the | future with a man like that for Presi- | de id one Englishman who heard '5.T0-1 ODDS OFFERED U. S. WILL BE ON GOLD JUNE 1 Insurance Is Quoted by Lloyds at 21 Per nd France Hail t Speech. the speech. Said another: “He talked as though he means business. He sounds as though he has the character 2nd force to deal with any situation.” Tourists in France were In the same difficulties as those here. This is a dull season for Paris, but the Riviera is well populated. Appears Determined. In Paris also the inaugural address was an encouraging factor. All who heard it agreed that it was an energetic pronouncement. A government spokes- man said: “He appears determined to end this crisis as soon as possible even if he has to use extraordinary means, Energy like that is pleasing to France. The London Sunday Times, congratu- President, described Mr. Roosevelt as “the man for America’s hour of crisis. After an excellent beginning,” said the Times, “he should succeed, for he has the character to do so. History should @ great President of the United Btates, but also a benefactor of the world.” = OPTIVISH FELT INNEW ENGLAND Banking Suspensions Forced by Action in Other State l Capitals. By the Ascoclated Press BOSTON, March 4—Banks in the New England States suspended busi- today as the bank holiday move- T in the Nation spread to this, section, Orders for the clesing generally were for Saturday and Monday. with Rhode Is| limiting the suspension to Satur- and New Hampshire making ion indefinite pending develop- Federal Reserve Bank at Boston, serving all of New England with the exception of one Connecticut county, likewise declared a two-day holiday Clearing houses and the Boston Stock 3 uspended business authoritics here announced that there would be no restraint placed on banking in the postal savings sys- tem. Closing Order Defied. While banks of the six States com- plied with the holiday requests generally there were instances of continued busi- | ness. In Connecticut many | open and the question arose as to whether the State now had suthority to order_closing of the institutions. In Massachusetts an exception to the closing move was that of two banks in Amberst which continued to do business, officials saying they did not consider it necessary to suspend. | Emergency action by State officials | over the week end was expected in a concerted movement to cope With the | situation and to place in the hands of ‘The 140-odd | the authorities the power to act where ous | it is now lacking. In most cities of this section police remained | NEW YORK BANKS RUSH CERTIFICATES Method Used in 1907 Crisis Expected to Be Used for Reopening. By the Associated Press. NEW YORK, March 4 —Preparations were rushed today by the New York Clearing House banks—with deposits of | more than $5,000,000,000—to resume banking activity on Tuesday by the use of clearing certificates, the method ‘?lglfiress!ully invoked in th: crisis of | 1. | ., Mortimer N. Buckner, chairman of | the Clearing House, said. after a meet- | ing of the members, that the certifi- cates, which would be used in lien of | currency, would be printed over the week end and that details of the plan would be anncunced later. | Federal approval and co-operation was considered necessary in some quar- ters, however, for the successful in- auguration of the plan, and Gov. Leh- | man, who proclaimed the New York | heliday at 4 am, | definite plans had yet been made for dealing with the situation after the two-day holiday terminates on Monday. Sees National Scope. Asked 1f the banks would reopen on Tuesday, he said, “I hope so.” He said. however, that the problem had now become national i scope. “Until T know what the Fede: | gram and policy is going to be, | difficult for me o ¢xpress an opinion,” | he explamed | In the meantime the Clearing House program to print the certificates was understood to be going forward, and it | was said they would be ready in vari- denominations, probably ranging from $5 up, for distrbution on Tues- day unless prevented by Federal or ‘1‘ were made | were stationed in the vicinity of banks | State action. rican bank- | gathered, but no demcnstrations were ' president of the Ameri nternational foreign _ex- g Wwas not quoted abroad. Money orders g to $100. One co cent cash for and gave chec erally were limited 25 per| orders | ilances. Rail- | lergency action, credit and rs would not be left because of banking | | and in some places anxious depositors Teported. | Governors in Washington. | The Governors of all the New England | States were in Washington for the in-| augural when the national situation caused them to act or give their ap- proval to the holiday action. All of the Governors in their proc- lamations or orders to subordinates ex- pressed & spirit of optimism regarding | comditions of banks in their own States | and generally explained the action as| The presence of Daniel E. Wocdhull, an Bank Note Co., at the Clearing House meeting was regarded as significant. inasmuch as his company prints most of the secu- | rity certificates used in Wall street, and it was assumed that it might be | called upon to print Clearing House certificates | No definite announcement of the | Clearing House plan of action was ex- pected before tomorrow night and pos- sibly not before Monday. Meanwhile, Police Commissioner Ed- ward P. Muirooney tcok extraordinary | having been precipitated by the proc-| precautions against robberies and dis- t State to hold | strictions, but an | declared night. Midwest and Sn) States took action toward holidays in rapid succession early in the day after | a had been deciared in the im- | rs of New York | &nd Illinoi e ADDRESS STIRS DENMARK R A e | Papers Say Roosevelt Heralded New | Era in Human Histo COPENHAGEN, Denmark, —P; t t's address was described “tremendously impressiv L h March 4 inaugural e today as| hailed the as being her- ory of man- t and his s alds of a new era in the kind. PART ONE—20 PAGES. General News—Local, National and Foreign. i PART TWO—S8 PAGES. Editorials and Editorial Features. Stamps - Page 4 New Clubs—Page 4 Colleges—Page 5. PART FOU Amusement ticn Musis In the Se 1 1 A. News—Page 4. serves—Page 4. PART FIVE—4 PAGES. Sports Section. PART SIX—12 Financial News and C] tising. D. A. R. News—Pa! Vet 2 2e 10, n Wars—Page 10. ome One to Lo Fraternities— Communit e 11, Centers—Page 11. American Legion Auxil: ry—Page 11. PART SEVEN—I8 PAGES. Inaugural Magazine Section Those Were the Happy Days—Page 48 | GRAPHIC SECTION—12 PAGES. | ‘World Events in Pictures. COLOR SECTION—8 PAGES. Holly of Holiywood; Keeping Up With the Joneses; Reg'lar Fellers; Mr. and Mrs.; Tarzan; Little Orphan Annie; n Mullins; The TimidsSoul; 'S tter Pop, ‘ | velopments. | specific problems treated. | and a better understanding of individual | | inasmuch as it was an extralegal group | authorized to act only in an advisory | the Firs lamation of holidays in other States. | Acting Governor Charles M. Smith of “panks of Vermont are not in trouble, but, of course, we can't go on with New York, Chicago and Boston closed.” Gov. Joseph B. Ely of Massachusetts id he was confident of the soundness of Massachusetts banks and Lieut. Gov. Bacon issued a supplementary statement | saying there was “no cause for fear or apprehension. BANK PROBLEM LEFT T0 INDIVIDUAL STATES Insurance Commissioners End Ses- sions Favoring Local Policies. By the Assoctated Press. | CHICAGO, March 4.—Solution of problems entering the insurance field | Dbecause of bank moratoria and restric- tions upon deposit withdrawals yester- day was left to individual States by the | Executive Committee of the National Convention of Insurance Commission- | ers. The committee, composed of eight State insurance commisisoners and su- perintendents, ended 8 two-day extra- | ordinary session at which delegates | from insurance company groups out- nned the status of the insurance busi: ness in view of recent financial di The meeting was held behind closed doors and at its conclusion the fol- Jowing statement was issued by J. B. Thompson, Missouri State insurance superintendent | “A full discussion of questions affect- ing the insurance field Jecause of nu-| merous bank holidays and moratoria wes participated in by the commission- ers and insurance company executives who were invited to the conference.” Commissioners and insurance com- pany officials declined to discuss the Thompson said the parley had re- sulted in crystallization of opinions, problems confronting insurance com- nies in rcspective States. He ex- plained the committee decided that, capacity, State insurance superintend- | were better able to cope with their en! local situations. GOLD MINES HELPING BANKS OF ALASKA Institutions All Funetioning as Usual, Due in Part to Pro- ducing Operations. By the Associated Press. ANCHORAGE, Alaska, March 4.— Gold mines are helping keep banks of the territory open on a normal basis Winifield Ervin, business manager of National Bank of Anchorage. and President E. A. Rasmussen of the Bank of Alaska, which has branches at Anchorage, Wrangell, Cordova and Skagway, said today that. so far as they knew all Alaska banks were functioning as usual. The fact that Alaska is one of the heaviest gold-producing regions of America, they said, has been of mate- sial assistance. orders. He canceled the days off of all police last| Vermont in a proclamation said the oicials ordered every detective in the department on duty tonight. detailed | extra policemen to every station house to be available as guards for merchants or others with laige sums of cash on hand and ordered a reserve squad of & dozen men for every precinct, starting Monday, as a “precautionary and emer- gency measure.” There were no disorders tonight. Refuse to Close, At least two New York City banks did not observe the holiday proclaimed by Gov. Lehman. At the Sterling National business was conducted as usual through the half day, and officials said the bank would be open on Monday. Joseph Pul- bermacher, its president, said he did not consider the proclamation mandatory on national banks in condition to meet pay roll requirements. The National Bank of Far Rockaway. on Long Island, also remained open, its president, John R. Burton, explaining the news of the Governor's message did not reach there until after the bank had opened. ‘The larger of New York's department stores reported a normal Saturday’s business with checks accepted in lieu of cash in most of the stores. The checks, however, had to be made out for no more than $1 over the price of the pur- chase as no change for more than $1 was given. Checks were still being accepted by the collectors of internal revenue for in- come tax payments, and it was an- nounced they would continue to be ac- cepted during the bank holiday. The holiday was taken calmly by New Yorkers today as they went about their business and contrived to get along on what pocket cash they had on_hand. Business houses, with the exception of financial institutions, were open as usual and some of the large depart- ment storcs reported shopping crowds were unusually large. ‘The bank holiday was, of course, the main topic of conversation. The word quickly spread and not many per- sons showed up at doors. Those who did, saw signs which read: “Gov. Lehman has proclaimed €aturday and Monday bank holidays™ or were told of the situation by attend- ents, and quickly dispersed. Crowds gathered in front of a few savings banks early in the day, but there was no disorder and as scon as those who had gathered, many of them foreigners, had been made to under- stand the situation, they left. Down in Wall Street, the clerks who found themselves with a three-day hol- iday on gheir hands, were in somewhat of a festive mood and the flags fl) for the inauguration helped to ma the famous street appear less austere. Everywhere there was good-natured discussicn of how much one had in his pockets and how he planned to appor- tion it over the week end. What to do about checks was a per- plexing problem. Most of the stores accepted checks, with certain restric- tions, for merchandise. Friends with extra cash on hand and neighborhood merchants who would cash small checks were much in demand. The banking situation was quickly reflected in newspaper advertising. One store announced “Your charge account is as good as dolla; and addéd “if you haven't one, come in and open one."” The telephone company said its bus- iness was booming, not only with calls for information to financial institu- tions and newspapers, but also with long distance calls connecting the financial district with all parts of the country as well as mmx foreign capi- tals. A lating the United States on its new| find Pranklin D. Roosevelt not only as| today, said that no| the closed bank | g ke | FINANCE MACHINE OF NATION HALTED Swift Movement to Convert Credits Ends With Ten- sion Eased. By the Associated Press. NEW YORK, March 4.—The great financial mechanism of the United Blates stood still today. ‘While a new President took office promising drastic and courageous emer- gency action, the banks of New ¥ork and Chicago, s well as the New York Btock Exchange, the Chicago Board of | Trade end other security and commod- ity exchanges of the Nation were closed. Financial and Government officials in | New York, Washington and other cities | bent their efforts toward development of procedure to permit resumption of financial transactions and business set- tlements next week, ‘The banking moratorium movement which started in Mi .:gan February 14 finally embraced the big financial in- stitutions of Walj Street and La Salle Street early today. and the swift move- ment to convert bank credits into cash was quickly checked in most of the re- mainder of the country. The holiday period was scheduled to end on Tuesday in New York, on Wed- nesday in Chicago, and to terminate on either Tuesday or Wednesday in most other large States. Cash Shortage Eased. Reports from over the country de- picted a Nation accepting with forti- tude and good cheer an unparalleled experience in the modern industrial era in_the United States. In the meantime, shortages of cash to meet ordinary living expenses failed to develop to any extent, and banks in a number of localities provided cash to meet pay rolls. Business and commerce functioned with little interference, with the practice of extending credit or ac- cepting checks widespread. ‘The New York Clearing House and as- sociations of banks in other cities met to develop methods of resuming banking operations next week. Plans similar to | those adopted in the money shortage of 11607, in which cleaging-house certifi- cates were used in the place of cash, | were widely discussed. The effect of the virtual standstill in banking in the United States, world's richest Nation with more than a third | of the world’s supply of monetary gold, | brought international financial transac- ! tions to & standstill over much of the world. In London, long the world center of international finance, quotations on American dollars and all other foreign exchanges were suspended. as well as quotations on gold. As a result, foreign exchange transactions were at a stand- still in Paris and many other capitals. It was the first time the dollar had not been quoted in a number of leading capitals since the Civil War. Withdrawals Checked. The New York and Chicago Federal Reserve Banks, as well as most of the other 10 re.erve institutions, closed owing | to general bank holidays. although no | formal order was issued from the Fed- eral Reserve Board at Washington. The | Federal Reserve Banks of Cleveland, San Prancisco and Richmond were ope however, and the Kansas City Reser institation transacted business for banks in its territory that were open. The closing of the New York Reserve Bank checked the large withdrawals of gold for hoarding and export which had developed. The Subtreasury in New York was open and redeemed Treasury | certificates for gold as usual, although it paid out metal only in $5,000 bars, dofng no business in_coin. Leading New York bankers held meet- ings at the New York Clearing House and elsewhere today, after sessions through last night and early this morn- ing. resulting in Gov. Lehman's procla- ering & two-day legal holiday, at4am The net demand deposits of the 27 clearing house banks were reduced by €109.944.000 in the week ended today, the weekly clearing house statement | showed, still leaving the huge total of $5.463.124.000. | Bankers explained that the rush to| convert bank deposits into currency had reached a point which taxed physical facilities to meet it, although the re- sources of the large banks and the Fed- eral Reserve system remained enor- i mous. National Gain Seen. A statement by the clearing house | declared that the New York banks| were in such condition that they “could. through facilities of the Federal Reserve Bank. pay on demand every dollar of their deposits,” but it had been decided to call a temporary halt for the benefit, Inot of New York primarily, but of the Nation as a whole.” Banking authorities said there was, no lack of currency-isSuing facilities or | of actual currency, but that it had be- come imperative to check the rush for | cash to preserve the long established and |efficient practice of ~doing _business through bank-check clearances and prevent an excess of currency which , would not be needed when hysteria had subsided. The metropolis received the news of | the holiday calmly, realizing that the steps were taken in the interest of the general welfare and that the big banks are actually in strong condition. One |bank honored blanket pay-roll checks |until the noon closing hour, and persons | who sought access to safety deposit| ! boxes, which had swallowed up large | amounts of currency this week, encoun- | | tered no difficulties. Gov. Lehman said ‘he did not object to such withdrawals. | Transacted by Checks. Financial authorities explained thn‘ 90 per cent of the Nation's business | was normally transacted throngh the | medium of bank chacks, and pointed ! out that total currency in circulation, | even at the record figure of $6,720,001 | 000 shown in this week's report, s only a fraction of the total of more than $40,000.000,000 in bank deposits | in the country, so that it was apparent | the hysterical movement to convert de- | posits into cash had to be checked, un- less currency were to be extended to ridiculous levels. Suggestions for resuming banking business dealt chiefly with methods of incre@ising check circulation, and the | records of 1907, when a real shortage of money necessitated various expedients, | were closely scrutinized. At that time, clearing house associations in New York and other leading cities issued clearing house certificates, which were used to | settle transactions and to some extent circulated as currency. ‘The present problem was seen as re- flecting chiefly a lack of confidence rather than a lack of currency, or a lack of banking facilities. If currenc: vere brovght out of hoarding, it wa. explained, there would be more than enough, for the amount issued is now far above that outstanding in the hal- cyon dzys of 1928 and 1929. A stalement was issued by the Fed- Efgememlng dye:‘-1 ‘ | eral Reserve Bank, su terday’s statement, which resulte | a sharp reduction of the gold decrease| | reported yesterday. Friday's report,| | showing transactions up to 3 p.m., had | } indicated a loss of $116,439,600, through earmarkings for foreign account and | exports, the largest reduction ever re- | ported for a single day. It was re- | vealed today, however, that after 3 E.m. there had been a decrease in gold held | for foreign account of $39,754,500, re- sulting in the addition of that amount to American stocks of metal. Huge Reserve Remains. This left the Nation's gold stock at the end of the week at about $4.245,- 000,000, more than a third of all the monetary gold in the world, and about £336,000,000 above the level reached last June 15, as & result of the large loss of metal during the Spring of 1932. Today's holiday was the first emer- gency action, which stopped gold trans- actions, since exports of the metal were | of the financial world turned to New | selling. The market | that emergency satisfactorily. Not even |Extra Printing Shifts Work to Meet Demand for Cur- rency. Day and night shifts are at work at | the Bureau of Engraving and Printing | of the United States Treasury turning | out Pederal Reserve notes to gneet the demand of the Nation for currency in place of checks, which have been the | business medium before moratoria were declared in & number of States. Officials of the Treasury would not | discuss the bureaw’s work, however. It | was known that the bureau previously had been working on a big furlough program, on account of a shortage of work. Under this program various i skilled artisans in the bureau were given furlough days each month in order to keep the whole number em- | Kloyrd. In some crafts it was known to iave mounted to as high as eight fur- lough_days & month, off duty, without pay. This was done to spread the work out among the whole personnel to pre- vent dismissals and keep within appro- ‘ priations. | The Bureau of Engraving and Print- | ing was the pioneer in use of the fur- | lough. The practice has been in use generally since the war to prevent dis- \?u.\:als and keep the skilled staff in- act. f Demand Increases, | Last week the demand for Federal Reserve notes increased $579,000,000, | | and with additional States declaring | bank holidays, making checks useless as & business medium, the demand for more currency increased. At the close of business on March 1 the total Federal Reserve circulation | amounted to $3.579.522.000. The Treas- ury’s statement for the same day showed there was outside of the Treasury or in circulation a total of $3.854.600,775. Against the amount of Federal Re- serve notes in circulation the Govern- ment held $2.180,967,000 in gold deposits by the Federal Reserve banks, which | was about $750,000,000 more than re- quired by law. A Federal Reserve bank note must be backed by 40 per cent in gold and the | remaining 60 per cent in either eligible | paper or United States Government ob- ligations. In addition to the gold held against Federal Reserve currency the Treasury had $1.032.589.000 in commercial paper and $661.900,000 in Government securi- ties. Latest Statement. The latest circulation statement of the Treasury for the end of January showed there was outside of the Treas- 8,413.200 in gold coin and bul- $1,321.933.749 In gold certifi- restricted in the war years, or from October, 1917, to June, 1919. | The closing of the Stock Exchange today was l{lz first time trading has been halted in this market by economic | circumstances since 1914, when the war | scare forced suspension, although the | bull market of 1928 and the selling| panig late in 1929 forced restriction of trading_hours to permit clerical forces to catch up with the work. Extended week ends were also taken in Novem- | ber of 1929 to give rest to clerks who | had been working night and day. After the closing of the exchange at the end of July, 1914, no trading was permitted until November 28, when re- stricted dealings in bonds were resumed. and December 12, when trading was again started in stocks. No parallel, however, was seen in Wall Street between the present situation and that at the outbreak of the World War. At that time, all of the markets closed in Europe, and most of the rest | York as the only place in which to| liquidate. Closure was to prevent serious collapse of prices by foreign as not been seri- ously taxed recently, however, and in three of the last five tracing sessions. stocks advanced. While official com- | ment was withheld. resumption of trad- | ing was planned for next Tuesday, at the -expiration of the New York bank- ing holiday. Policy Is Traditional. Exchange officials have traditionally resisted suggestions that trading be stopped. Great Britain’s departure from the gold standard in September of 1931 again left the New York mar- ket the only major one open. Severe pres- sure was brought upon exchange of- ficials to suspend trading to prevent a flood of selling from Europe. But the market had grown since 1914, and met in 1907 did the exchange close, or dur- ing the crisis of 1893. It did close for 12 days in September of 1873, how- ever, coincident to the failure of Jay Cooke & Co., promoters of the North- ern Pacific Railroad.. The only parallel in recent times for the almost Natlon-wide bank holiday in the United States was the experience of Germany in July, 1931. But the contrasts are marked. Financial au- thorities pointed out that the much stronger position of the United States should lead to prompt resumption of normal business, even though the banking structure in this country is less concentrated and unified than in Germany. The complete holiday in the Reich lasted for a week in July, 1931. Her gold reserve had been drained to only about $340,000,000, the country was severely in debt abroad, and had suf- fered a serious drain of capital into forelgn financlal centers. The United States, on the other hand, is the world's richest nation, a creditor of much of the rest of the 1d, and has the en- FOERAL ESERE | ormous sum of ,000,000 in mone- tary gold. ¥y Offers Plan to Reopen Banks NUTES ARE RUSHED‘ William S. Morehead, Pittsburgh Attorney, Proposes Segregation of New Deposits in Trust After Bank Limits William S. Morehead of Pittsburgh, a prominent Pennsylvania attorney, who is counsel for several large banks in that State and who has taken part, én an advisory capacity, in the drafting of national banking legis- lation, presented to the cohtroller of the currency last Friday a plan that, in his opinion, would permit thg im- mediate functioning on a mew’ bas‘s of the banking institutions now sus- pending or restricting withdrawals. At the request of The Star he has telegraphed to this mewspaper an outline of this plan. It appears below. BY WILLIAM S. MOREHEAD. OU have requested me to tele- plan to be followed by banks l placing restrictions on with- drawal of deposits which T pro- to representatives of comptroller The main features of this plan are as follows: The board of directors of the bank finding it advisable to restrict with- iting the withdrawal of existing de- posits to such percentage thereof as is decided upon, which should not exceed the ratio of cash or its equivalent to graph you a brief outline of a of currency Friday. drawals should adopt a resolution lim- deposit liabilities and any other in- | debtness. Restrictions on withdrawals and the right to withdraw the prescribed percentage should apply both to check- ing and savings accounts. New de- posits received after the restriction date should be segregated and held by the bank in trust for new d:positors sub- ject to withdrawal in whole or in part by such depositors or in accordance with their written orders or checks. The trust fund so created should be held in cash. on deposit in Federal Re- serve Bank of district wherein restrict- ing bank is located, or invested in United States Government bonds. Some investment feature is necessary to eliminate the effects of hoarding cur- rency in the trust fund. Withdrawals. The trust fund for new depositors | must be physically segregated and a separate (Pepnnmvm. for new deposits | would be advisable. |~ That part of the trust fund depcsited in the Federal Reserve Bank should be carried in a separate account prop- erly designated and not applicable to payment of any loans or discounts theretofcre or thereafter made by the depositing bank. -Arrangements should be immediately made whereby all Fed- eral Reserve Banks can so receive and carry such deposits. At the time of making new deposits a card should be signed by depositor or his pass book stamped with appropriate words im- pressing the trust on new deposits made after restriction date. Checks on new deposits ‘should be appropriately stamped to indicate intended drawal from trust funds In my opinicn, the prohibition in the Pederal Reserve act against a national bank recelving in its trust department deposits subject to check applies to or- dinary deposits creating the relation of debtcr and creditor and not to deposits under & trust in & separate depart- ment Netional or State banks not having trust powers may require validating legislation to cure ultra vires acts. but absence of statutory trust powers should not affect valdity of trust while in effect. National banks putting the plan in effect should immediately report to controller of currency for approval of the plan and State banks should similarly report to State banking au- thorities. Restricting banks should make every effort to liquidate their general assets and when necessary and possible to re- place frozen assets bv liquid assets so that restriction on withdrawals may be eliminated as soon as possible. cther- wise, litigation might force receivership. A Government guaranty of new de- posits under this plan could be made without danger of substantial loss de- pending on the latitude of investment | of trust funds. Church Welcomes I. 0. U.’s With Texas Banks on Holiday By the Associated Press. EL PASO. Tex, March 4— Lack of cash. because of a bank holiday in Texas, will be no ex- cuse for non-attencance at church _services here tomo:row. The First Baptist Church an- nounced today that I. O. U.'s will be received gladly when the col- lection plate is passed around. — ECONOMIST IS HELD German Government Asks Harvard Lecturer's Deportation. BOSTON. March 4 (#).—Dr. Joao F. Normano, former lecturer on eco- ncmics at Harvard University, today was ordered held for extradition to Germany by United States Commis- sioner Edwin C. Jenney. The German government asked his return on the ground that Dr. Normano was Dr. Isaak Lewin. fugitive former | Berlin barker, wanted in that country for = an alleged swindle involving $750,- 000. !ACTS TO HELP CITIZENS | LEFT WITHOUT MONEY | New Orleans Mayor Calls on Food Dealers and Utilities for Easy | | | Credit Policy in Closings. By the Associated Press NEW ORLEANS, March 4.—Acting to aid citizens embarracsed for cash. Mayor T. Semmes Walmsley today called dealers in foodstuffs and repre- sentatives of public service corporations | to City Hall. suspended the Sunday store-closing law and secured pledges that a liberal policy of credit would be practiced during the Louisiana bank | holiday. | Mayor Walmsley said the city welfare | agencies would secure necessary sup- plies for those without established credit and that public service com- panies had agreed not to suspend serv- ice for non-payment of bills. By proclamation of Lieut. Gov. John B. Fournet, acting Governor, Louisiana’s | banking holiday, originally ordered for March 2, 3 and 4, today was extended through Monday, March 6, and was made mandatory. The New Orleans Cotton Exchange | announced its closure order for Thurs- day, Friday and today, had been ex- | tended “until further notice.” History in the Making Inaugural Editions The Evening and Sunday Star Mailed, Post in United State. 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Subscriptions Will Be Taken at Star Want Ad Stations No Telephone Orders or Charges with- | JAPANESE MARCH INTO JEHOL CITY Tiny Advance Guard Finds Capital Deserted by Chinese. | CHINCHOW, Manchuria, Mareh 4.— | A handful of Japanese soldiers, push- ing through a blizzard from Pingchuan, | marched into Jehol City at 11:30 o'clock | this morning and took it over without struggle. | Only 128 men were in the advance guard which was first to reach the ob- jective of Japan's invasion, but they raised the flags of Japan and Manchu- kuo without firing a shot, then pushed on southward toward the Great Wall ot China. Tang Yu-Lin, governor of the prov- ince and commander of its army, had fled. The defending troops were in ragged retreat. Most of the people had leit, taking with them all they could carry of their own goods. Win Short Battle. Behind the vanguard Gen. Kawa- hara’s 16th Infantry moved up toward the capital. This main body had been checked briefly by a force of 3.000 Chi- nese 4 miles from the capital. There was a short battle, the Chinese were | routed, leaving behind artillery, ma- ! chine guns and cavalry mounts. Behind the 16th came the 14th In- { fantry under Gon. Hattori. This force scattered the Chinese defenders soutn | of Lingyuan and captured the pass at Lenkow, in the mountains between Shanhaikwan and Koupeikow. It took only 11 days to conquer Jehol and the campaign, Japanese officers said, cost much less than they had an- | ticipated. It also required less time, for the base headquarters here had pre- dicted Jehol City would fall by March 10. | | Wall to End Advance. | The immediate work in hand now in- volves driving the remnants of armed Chinese out of the province. This will require an advance beyond the capital clear to the Great Wall, which now will be the southern boundary of Manchu- kuo, increased in extent by the annexa- ticn of Jehcl. Beyond the wall the Japanese say do not intend to go. We have no desire to pass the wal an army spokesman said today, “un- less we are compelled to do so for the protection of Japanese who live in Peiping and Tientsin. If their safety is net threatened by the Chinese, this con- flict is as good as over now." GEN. TANG IN FLIGHT. t Life Threatened by Chinese as Well as by Invaders. PEIPING. March 5 () —Dominating | Jenol Province because of their occu- pation of the capital, Jehol City, Japa- nese forces have planted their flags along the Great Wall of China. Gen. Tang Yu-Lin, governor of Jehol, whose defense collapsed, tod2y was a fugitive at Luanping-Hsien. His life is threatened if crosses the Great Wall—the southern boundary of Jehol— or equally in danger if he falls into the nands of the invading Jzpanese. Gen. Tang's flight was reg:rded here as treachery and Marshal Cnang Hsiao- Liang, North China war lord, issued an order for the governor's arrest on & | charge of desertion. It was said here today that Marshal Chang is determined the governor's | troops must redeem his promise to fight to the finish, and that measures were being teken to reorganize them Until today no one knew where the governor had gone. Continue Fighting. It was also understood that groups of Marshal Chang's troops continued to fight desperately today. Portions of his army near Koupeikow Pass are being provisioned by a supply “train” of rick- shaws from Peiping. These carts last night traveled over the mountainous country without pause. | Chinese authorities, including Mar- shal Chang’s headquarters, admitted that s party of 128 Japanese soldiers took possession of Jehol City and that another small party of Japanese had pushed southward to & spur of the Great Wall, where they planted the Japanese flsg. Inhabitants of Jehol were said to have welcomed the invaders and to have de- | nounced the regime of Gen. Tang. | The small Japanese force broke through the defense between the capitil and Pingchuan. but the main defense, between Lingyuan and Koupeikow, res mained unshaken, a statement {rom hal Chang'’s headquariers sa.d. Jehol. concentrat keep Tang's army regular forces from descending China proper. This is a precautionary measure to prevent disorders in North China which would provide the Japas nese with an excuse to push their ad- vance south of the Wall. Ordered to Keep Posts. Altogether 50,000 of Chang's men are between Lingyuan and Koupeikow with orders to stay there until the central government at Nanking directs their withdrawal. Just before the arrival of the enemy early this morning Jehol City was so peaceful that it was hard to believe armies were fighting at its gates. The populace knew that surrender was inevitable. Most of them had left during the last few days, pushing ahead of them wheelbarrows piled with their few belongings. riding south on bicycles, | inrickshas, in pony carts or automo- biles. Hundreds started the long hard journey afoot. Most of the local offi- cials had gone, the post office was closed and the administrative offices deserted. Word of the capture of Pingchuan came yesterday afternoon and that eve- ning the first of the retreating Chinese army straggled into the city. Tang Yu-Lin. in betier days the “opium king.” but now only a weary defeated general, left by motor car | without revealing his destination. When a correspondent visited him he made no attempt to conceal his dis- couragement. For several minutes he sat silent, gazing through a window. “I'm all in,” he said at last; “I am in a difficult position. I don't even | know where my troops are.” 'MARYLAND BANK OPENING DELAYED | ) | ¢ Holiday Extended at Least Until Tuesday Because of Other States. By a Staff Correspondent of The Star. BALTIMORE, Md., March 4.—Com- plicated by the extension of the bank- ing holiday to almost Nation-wide scope, Maryland's banking holiday will be extended at least until Tuesday, it develoved tonight, when Gov. Ritchie | cflicially proclaimed Monday to be a ; legal holiday. Closing of the New York banks was th> most disturbing feature to the bankers of Ma: nd and most other States, as practically all the large State benks carry balances in Manhattan in- stitutions. Gov. Ritchie and his advisors were | considering the Maryland problem in the light of the latest developments, hoping to be able to open the State's banks, under the emergency act just pasted by the Legislature, with the least possible delay.