Evening Star Newspaper, June 18, 1933, Page 55

| News of Markets Pages 1 to 4 FINANCIAL AND CLASSIFIED he Sunday St Pages S to Classified Ads 12 WASHINGTON, D. C., SUNDAY MORNIN( % . JUNE 18, 1933. Part 6—12 Pages BANK ACT TO HALT PAYMENTSHERE ON DEMAND DEPOSITS Interest on Check Accounts | Soecifically Barred by New Measure. Under Inflation, By the Associated Press. | NEW YORK, June 17—With the re- ~uest of the Naticn's railways for a 2215 per cent reduction in Lasic wage | Tates, the cost of transportation, a sub- ject of perennial and often bitter dis- bute, is once more thrown into bold | relief, Specifically, the railroad manage- | ments are demanding that the existing | 10 per cent cut, accepted voluntarily by the rail unions last year, be made per- | manent, and that an additional 121 | i | per cent reduction be put into effect. Bew York Clearing Honsc Sends | Do ey labor negotiations involving | : e union contracts are carried out in ac- Out Notices Quickly, but D. C. (C5a% SR riceription of the rall- | Action Is More Deliberate. | RETURNS ON SAVINGS BALANCES UNCHANGED PLEA FOR NEW WAGE CUTS REVIVES RAIL COSTS ISSUE| ‘Labor Holds Request Is “Unpatriotic” Point to Huge Deficits. | since the war have gone up faster than but Executives | pay reductions vigorously already Iis apparent. Spokesmen for the million union workers affected were prompt in branding the carriers’ action as “un- patriotic” at a time when efforts were being made by the Government “to bring the country back through infla- tion.” The railways contend that wages the cost of living. Recent statistics show wages absorb _approximately 50 | per cent of every dollar of railway op erating revenues. The Bureau of Rail way Economics is authority for the statement that average wages per rail- way employe at the end of 1931 stood at approximately 120 pc. cent above PARLEY HOPES DI BUT FUROPE SEES BETTER BUSHESS Berlin, Paris and London All Gloomy on Trend at Conference. MORE THAN 1,500,000 BACK IN REICH JOBS French Unemployment Also De- clines and Tone of British In- dustry Continues to Improve. way labor act, which provides that the | railways shall first negotiate directly | BY EDWARD C. STONE. As a result of the passage of the, Glass-Steagall Banking bill, now signed by the President, Washington banks will | ®oon stop paying interest on demand deposits, or checking accounts, as they | mre more commonly called. The new bank bill leaves no option in the matter and banks can no longer offer mtel’es(’ on checking balances as an inducement to carrying large demand accounts. ‘The New York Clearing House Asso- ciation already has sent letters to its members calling attention to that sec- tion of the act of 1933, better known as the Glass-Steagall banking bill, relat- ing to the payment of interest on de- ‘mand deposits, stating that it has been advised by counsel that the “amendment becomes effective immediately upon signing of the act by the President.” Several of the larger New York banks | and trust companies already have sent their own notices to cepositors, stating| that the interest on demand deposits | henceforth will be discontinued, in ac- cordance with the law. Attention is being directed specifically to sectlon 11-B, which provides that “no | member cf the Federal Reserve System shall, directly or indirectly, by any de- | vice whatsoever, pay any interest on | any deposit which is payable on de- mand.” How anxious New York banks were to cease payment of this interest is shown by the fact that the notices were sent out before the bill was even signed. Washington banks have nct been so hasty. The custom of paying interest on | checking accounts has prevailed here | for a good many years, although con- siderably reduced” from the original | amount. On large checking balances it| has amounted to substantial sums. The usual payments cf interest on savings| @&ccounts remains unchanged. Institute Delegates Due Tomorrow. Delegates from Washington Chapter, | American Institute of Banking; to the | annual convention in Chicago, are on | their way home and will reach here tomorrow morning. At the annual | election, A. S. Puelicher, vice president | of the Marshall & Isley Bank, in Mil- waukee, was elected president, succeed- ing Frank N. Hall of St. Louis, con- troller of the Federal Reserve bank in that city. Charles E. Ellery of Newark, N. J., was elected vice president. One of the most interesting address- es at the convention was made by Eliot K. Bartholomew of Wood, Struthers & | Co., who talked about the railroads. | When business recovers, the railroads can haul traffic in most cases more cheaply than ever before in history and as a result, be in a position to report astonishing gains in net earnings, he said. Operating efficiencies, he asserted, show remarkable improvement. “One reason for this has been the scrapping of obsolete equipment and the use of more modern rolling stock,” he said. “The saving from the use of more modern power is amazing. A large | | ties agree to that procedure. with their employes. Recourse may be had, however, to arbitration if both par- Failure on that score demands the appointment by | the President of a “fact finding com- mission,” to sift both sides carefully. | it is said, affects equally the many in- There are no disciplinary measures | in the law to enforce conclusions of the commission. Only the pressure of public opinion can bring about com- | pliance. That labor will fight the proposed the 1913 level, whereas the cost of liv- ing rose only 50 per cent. Collectively, the gigantic transporta- | tion industry has operated during the | past year at staggering deficits. This, | dustries supplying railway equipment ‘And supplies, and the holders of the $19,500,000,000 of railroad obligations and shares, most prominent of which are kisnsumnce companies and savings | banks. LARGE BANKS GIRD FOR WIDE CHANGES. AS PRICES PROMISE UNDER W LAWS Drastic Departure From Old | Policies Planned by Finan- cial Leaders. BY HIRAM HERTELL. Associated Press Financlal Writer. NEW YORK, June 17.—Drastic { changes in banking practices will be put into effect soon as a result of enact- ment of the Glass-Steagall bank{ng bill, it was indicated here by a survey of | financial opinion. ‘The signing of the measure by President Roosevelt, found the legal de- | partments of Wall Street banking insti- tutions busily engaged in a close study of the measure. Private bankers here have not yet de- cided what they plan to do on the choice which the bill gives them be- tween giving up the deposit banking business or the security business. At the offices of J. P. Morgan & Co. | it was explained that this point would be decided only after long and careful study. Kuhn, Loeb & Co. has reached no decision on the matter, it was said. | Believed Unaffected. Some of the other important private bankers, including Lehman Brothers, Dillon, Read & Co., and Goldman, Sachs & Co., felt they would be unaf- fected by this feature of the bill, be- cause they have virtually no deposit business. Another section of the bill requires national banks to divorce their security affiliates within a year. The most im- portant sccurity affiliates still in exisf ence are those of The National City Bank. The Guaranty Trust Co. and The First National Bank. The National City already has taken eastern railroad which bought 10 loco- | motives two years ago, estimates that | Preliminary steps to eliminate its se- toes ; ates that | Curity business—conducted through The Biey have sleeicyipid R Enemeel oA | e ioual Oity i0o= bt The Gusanty Colton Goes to New Position. Trust Co. and The First National Bank Barnum L. Colton, who has been one | bave not yet made an announcement of the vice presidents and trust officer | OD the matter. of the District National Bank, is to| Officlals .f both of these institutions, become real estate officer of the Na- | however, have been studying the situ- tiona] Savings & Trust Co. according | 2tion for some time and an early state- 1o information obtained in the financial | ment is expected. The First Security district_yesterday. | company, security affiliate of The Pirst Mr. Colton has been connected with | National Bank, never has had a retall the District National Bank for the p: eight years and is one of the ci lem is different from that of The best known younger bankers. A native | Guaranty Trust Co. whose affiliate, of this city, he is a graduate of the | The Guaranty Co., has maintained re- Georgetown Law School, class of 1921, | tail distributing units throughout the end is a member of the District of Co- | country for many years. lumbia Bar Association Legal Test Likely. He is a former chairman of the Fidu- claries Section of the District Bankers’ Complete divorcement of The Chase National Bank's affiliate, The Chase Association and has served on several of the association’s leading committees. | Securities Co—which in turn con- At the last annual convention held at|trolled The Chase Harris Forbes Cor- | distributing organization and its prob- | Hot Springs, Va., he was chairman | of the Program Committee | The president of the National Sav- ings & Trust Co. is William D. Hoover. He will place Mr. Colton's sele ectors for approval at | Directors of ating & Wh: have declared the r s ! dividend of s | he “company. payable f June 14 e 14 to J Siraciion & he Terminal Refriger- record nouncement y ward the On Na the First Bank in Maryland Reopened. The St. Michaels B: Mich- sels, Md, has reope 100 per cent basis. following the c tion of a John J. TUnde: 70 per cent of their deposi other 30 per cent in certifica eficial interest. The ins n in- creased its capital to $25.000 through the sale of new stock and has deposits of about $275,000. The great depression enough of the essential r to be made, and has resulted in creating sufficiently serious shorteges of essential g0ods, so that industry, trade and trans- portation are expanding, states Col. Xeonard I' Ayres, vice president of the @eveland Trust Co., in his monthly re- W¥lew of business. In this country they &re doing so with a vigor never before equaled, he added. Fresident Roosevelt has not yet de- any definite steps should has forced djustments poration—already has reached the final stage with the recent assent of the bank's stockholders to a plan of | liquidation All the other large New York insti- | tutions previously disposed of their se- curity affil'ates Litigation by banks and their stock- holders to test the constitutionality of | the new law is considered a possibility | here. Law firms which have had expe- rience in this field are already studying o tion, it is understood, with r reference to the controversial contested deposit insurance WITH GOLD BLGC France, Switzerland and Holland Are Other Nations Left on 0ld Standard. e few remaining plans to Thus ide Fra the other re- es T policy was re- {vea s reply to Presi- | osevelt's ge, in which it i clgium was will- | ing rate in any other way, she cculd not make currency arrangements. The Belgian government has also an- nounced in connection with the program of retrenchment which it has decided upon that it excludes as “disastrou: any measures of inflatjon or devalu | tion or forced conversion of state obliga- ticns. In brief, the four gold standard coun- ies will maintain the view that a cur- rency not linked to gold is bound to be unstable and they disbelicve the theory that monetary manipulation is capable | of raising the world prices of commodi- | ties, | trd be taken to refinance callable Govern- ment obligations at lower rates of in- terest but he believes this would be & fine thing to do later if conditions con. tinue to improve, L) any changes in her | FARMERS CHEERED MORE READY CASH Largest Income for Last Two Years Will Ease Rural Troubles. BY OWEN L. SCOTT. Special Dispatch to The Star CHICAGO, June 17.—Hard cash in! | & volume not enjoyed for more than two years continues to roll into the pockets of this country's farmers. The wheat harvest now covers a wide area in the Southwest, where pro- ducers are marketing a short crop at prices about 25 cents per bushel higher | than last year. This means a return above the cost of production for the first time since 1930 in many instance: At the same time, advices from the dairy sections of the Middle West and from the wheat districts of the North- | west, now being received here, sound almost like bullish market letters when compared with similar reports of only two or three months ago. 4 ‘There is sweet music for the ears of the Southwest in reports that the Sec- retary of Agriculture plans a processing tax on wheat to apply to the present | crop. While this tax would be levied | and distributed on the basis of prom- | |ised reduction in next year's acreage, | |1t will mean real cash for many farm- ers who otherwise would have faced a barren year because of drought in Win- | ter wheat districts. Expect Money to Spend. ‘The vision of a tax bounty just adds | to the general indications that agri- cultural regions are going to have money to spend this Fall. Yesterday's report from the Federal | Reserve Bank of Minneapolis, covering | the Northwest section of the country, | | said that “the volume of business in the | district continued to improve during May and an increasing number of lines | of activity exceeded the volume of the preceding year.” | Cash income of farmers whose | marketing during the month was set at $23,692,000 for the district compared | with $15,348,000 a year ago. Most of | | this gain was in wheat and hogs. Wheat | | marketings were shown to have been particularly heavy as producers who had held their grain for better prices, | turned to eelling. The list of farm commodities show- |ing an increase included wheat, corn, rve, flax, butcher cows, feeder steers, | hogs, lambs, ewes, butter, eggs and po- tatoes. | The Wisconsin crop reporting service 1ndvlsed that the average price of milk | in Wisconsin for May was 95 cents| per hundred pounds, or 8 cents higher than in April, and 15 cents above a year ago. This increase came in a| period when declines are normal. Prices | of farm products in the State were set at 69 per cent of the pre-war level, | compared with 61 per cent in April and 58 per cent in March. Grain Prices Climb. | | Grain market this week touched | the highest level of the season and then reacted somewhat, partly as a| result of hedge sclling against the movement of the new crop. Live stock | prices moved lower owing to heavy| supplies. Packers have taken an op- | portunity to build up inventories and | marketing of hogs and sheep direct to | big killers has been unusually large ‘ | “Packing interests have been work- !ing on & plan for applying provisions | | of the new farm marketing act to live | stock. It is expected that soon their! scheme for insuring higher returns to | the producer for hogs Will be an-| nounced. Controlled marketing s at the base of the plan. Farmers are not likely to find them- selves rolling in wealth this Fall, but| their position no longer appears hope- | ]1m. Higher prices suggest that the | farm debt burden is not to be un- bearable and trouble in the agricul- tural districts has died out. Fore- | closures are decreasing in number, ! while farm strike talk is absent. The feeling among hard-pressed farm pr d s 15 that happier days are ht.'v‘ again. (Cop: 1933.) OIL COMPANIES BOOST |+ GASOLINE WITH CRUDE By the Associated Press { NEW YORK, June 17.—Coincidert with the enactment of the national in- | dustrial recovery bill, prices of gasoline and crude ofl are being advanced in leading marketing areas. The recov- ery measure imposes a tax of ly-cent & gallon on gasoline. Retail prices of gasoline have been raised 1 cent a gallon in most of the important consuming sections east of the Rocky Mountains. Crude oil quo- tations were lifted about 25 cents a barrel over much of the midcontinent area. Most of the larger gasoline distrib- uters in the Eastern territory will put the higher prices into effect on Monday. This applies to the Standard Oil Co. of | New York, and the Standard Oil Co. of | New Jersey. ‘The revision in the crude price struc- ture re-establishing the price in effect before the 25-cent-a-barrel cut on Jan- uary 19 lash | be outgrown in a genuine spirit of in- Special Dispatch to The Star. NEW YORK, June 17.—Cables and wireless dispatches to The Business Wecek give the following survey of busi- ness abroad for the week ending today: BERLIN.—Sentiment in Germany re- garding the London Conference is pes- simistic. Dominated by Nazi philoso- phy, Germany foresees economic recov- ery only after each country has first consolidated its efforts at home. Actually, domestic business is more cheerful at the end of the week. Em- ployment is increasing. Since the Win- ter peak, more than 1,500,000 men have been re-absorbed in industry. Car- loadings art now 5 per cent above last year’s level. For 6 consecutive weeks there have been advances in_wholesale prices. Originally, this was limited to the group of agricultural products, but within the last two weeks it has been finished goods. Consumer industries, notably cotton textiles and shoes, have registered gains this week. Resentment abroad over the proposed transfer moratorium has caused some worry to Germans. It seems likely now that the Dawes and Young loans will be exempted from the moratorium and that preferential treatment will be made where the attachment by the debtors of property or of export proceeds is possible. This would apply especially to the shippng and potash loans. French Firm for Gold. PARIS —Naturally, no business devel- opment in France was sufficiently im- RPRISE HOMECOMING .. S NS portant this week to eclipse interest in the Londen Conference, and the French attitude of gloom concerning the con- ference not having altered after the opening sessions, ~ the outlock has chaneed little during the week. The French are convinced that the outcome of the conference will be either an utter fiasco or that it will be buried in a meaning'ess diplomatic communicue de- claring for “more international goo: will and hope that the depression will | SUMMER CLOSINGS IDEA ABANDONED (Orders Piling Up, but Wage Increases Are Urged to Maintain Pace. BY JOHN A. CRONE. ternational co-operation.” France stands firmly for a return to the gold standard and sound, if old- fashioned, economy. To the average Paris executive the present boom in Wall Street is but another flurry as unsound as 1927. Talk of inflation falls on dead ears here. The index of wholesale prices has de- clined 7 per cent since December. The retail index is off 4 per cent—in the same period. Unemployment. however, has declined more than 8 per cent in; SPecial Dispatch to The Star. the last five weeks. | NEW YORK, June 17.—The volume LONDON —Business has been sub- | 0f forward orders accumulated by mills ordinated all Week to the big events in |and factories has made them abandon London. Despite the gloomy predic- | all thought of Summer closings, as is tions for the conference outcome, and |Usual at this season. These decisions in spite of the crop of rumors bound | Were arrived at this week as the gen- t0 come along with sharp bargaining in | eral commercial and industrial revival, the next few weeks, the tone of British | Which has been moving at increased business is good. Ilmomentum since early April, contl;:\:cd Blgaaiia with Dl under the beneficient influences of in- Disgust sl general in u:n:ion when| SSASE cHmioHnt fand 8dvangoE the dollar continued to fluctuate vio- | Nation-wide surveys now emphasize lently all week. Washington Wwas ac-|the employment gains in centers iden- | nations will | will follo cused of deliberately manipuating for- eign exchange so as to gain an advan- tage at the conference. siders the pound at anything above $4 unnatural, and stfll expects that any de facto stabilizaticn will be at some- thing under SI. Not all the uncer- tainty, however, killed hope that the little group of international bankers working at the Bark of Eng'and might arrive at some agreement. It is argued “ths'. this problem—which 3 of the 66 nations at the conference can handle— can be settled. The sterling group of follow the dictation of the remaining gold nations v Prance; not a small group ¢ the lead of Washington. Consternation over the recent Ger- man transfer moratorium is as great this week as last. A strong committee has been_ formed to pr German long-term bonds. Included in the membership of the committee are representatives of insur- Britain will follo ance companies, investment trusts and accomplished fact next maonth if the of the national industrial recovery act her said, “and within a short time I the old and respected Council of For- eizn Bondholders, Not a little has been said and written denouncing the apathy of the Bank of England in the whole matter, the stockholcers taking the point of view that the bank. having helped to float some of the German issues, should now do more to aid the stricken public. And other bank are denounced for betraying their investors in_order to save their own “standstill” bills. Nego- tiatlons with Dr. Schacht already are under way. LYNCHRURG PLANTS SET JOBS RECORD Four Concerns Giving Employment to More People Than at Any Time in Their History. Special Disp to The € LYNCHBURG: The 3 and June 17— nachines re giving e than here- Co.. shoe manuf: t concern in the city, orkers, compared with a few more than 3,000 in former years. The factories of this company are working fuller than during the past few years, and there are indications of steady good business for at least two Craddock-Ter: the large or three months, said D. H. DlIlal’d,‘ president. Since May 1 the Blue Buckle Overall Co. has increased its emp is now working 500. This is the larg- est in that concern’s experience The N. & W. Overall Co., with two plants here, is working 500 operatives, }llgumg also increased in six weeks by 0. The Virginia Art Goods Studio, mak- ing leather goods for women, is work- ing 200, an increase of 50. The Lynchburg Hosiery Mill is work- ing a full force, 575, and the Consoli- dated Textile Corporation, which has been operating on full time since last September, has 750 workers on a day and night force. This company re- cently gave its employes an increase in pay. ; bl London con- | |tified with the production of textiles, |leather goods, shoes, glass containers, | automobiles, tires, electrical supplies, | refrigerators, radios. furniture, iron and steel and metal products. Close Study Needed. | The average business man, big and | little, continues to worry about the labor aspects of the recovery act, when he should be more concerned with his jown part of the m:asure—namely, the | |attainment of some fundamental | knowledge of business management, | which will enable him to know costs, | keep accounts correctly, and be able | |fo report intelligently on production, hours of labor, wages paid and prices received. | There is no question just now that tect holders of | the administration realizes that in- Cost Accountants at the annual meet- | of the banks closed before February 24, creased wages in the six basic indus- | tries, steel, textiles, lumber, oil, auto- motive and coal, will have to be an rate of manufacturing activity is to be | continued at its present speed. Unless | the” public has increased purchasing power, industry will have to move at a slower pace. The public works program will add greatly to the general total of public purchasing power, but its efforts will |be greatly strengthened by an immedi | ate wage increase in many industries. Retail Sales Mount. Retall sales, however, are still rising, less merchandise Is being offered be- low the cost of production, stores are narrowing their losses, and repricing of stocks is becoming general, as retailers now realize they have been selling mer- chandise far below replacement costs. “Consumers are offering no resistance to the higher price levels,” according |to Dun & Bradstreet, Inc., in their national weekly survey of business. “Jewelry, silverware, watches, furni- ture rugs and shoes are being bought | freely, in spite of the new price tags, | while there has been a revival of in- terest in musical instruments, and radios.” (Copyright, EUROPE BEST MARKET FOR AMERICAN AUTOS By the Associated Press The Commerce Department Teports that Europe has been the best export market for United States automotive products for the last 10 years. Total exports during the decade amounted to $939,550,000, or about $330,- 000,000 more than exports to North American markets, the department said. Following Europe as the best export market came the group of North Amer- ican countries with the South American group of countries, Australia, Central America, Africa and the New East fol- lowing in order. 1933.) i - = Trading Curb Modified. NEW_YORK, June 17—The New York Stock Exchange today further modified its emergency regulations deal- | ing with short selling, and henceforth member firms will be required to report short positions monthly instead of weekly. Originally the Exchange de- manded detailed reports on short sell- ing daily as & means of checking bear selling during the period of market demoralization in the Fall of 1032, pianos | hanges Position COLTON TO JOIN STAFF OF NATIONAL SAVINGS. BANKS REOPENED Only 10 of 138 Still Closed H: . | and Every County Has Facilities. | Special Dispatch to The Star. | BALTIMORE, June 17.—There are | 128 State banks and trust companies | out.of a total of 138 in Marylind open | today on & basis varying from 2 to 100 | per cent, about four months after the declaration of the bank holiday on | February 24. National banks are not included in the list. Only 10 banks in Maryland which shut their docrs on February 24 so far | have failed to reopen on any percentage basis. And reorganization plans are under consideration for -practically all of these 10, according to John J. Ghingher, State bank commissioner. BARNUM L. COLTON, ‘Who is slated to be made real estate officer of the National Savings & Trust | Co. at tomorrow’s meeting of the direc- | At present, according to Mr. Ghing. | tors. He has been a vice president and her’s latest information, there are 89 | trust officer of the District National | State banking institutions operating on Bank. & 100 per cent basis in Maryland, 14 e on a basis varying from 5 to 30 per cent, and 25 on a 2 per cent basis. In Baltimore there are nine com- mercial banks and eight savings banks jon a 100 per cent basis, one savings bank on a 30 per cent basis and two on Important Task in a 5 per cent basis with three commer- cial banks on a 5 per cent and three still | InduStry ContrOI with their doors shut. | | The!\:an flgureifl n;edexclu.five of na- | tional ks, which do not come under | ‘Before the National Assoclation of | Mr. Ghingher's jurisdiction, and. also 'Accountants Face ing in New York, Nelson Gaskill of ©f Which there are four in Baltimore. Washington explained the application | panying. aceommedatines e Gront |to industry. He is president of the believe that the banking facilitles of i s T the State will be sufficlent to care for Lead Penci] Institute and formerly was | * = a member of the Federal Trade Com- | Scth present and prospective business mission | He declared the cost accountant must assist by furnishing accurate data | needed to co-ordinate business activity | by industrial groups as contrasted with independent action by individual estab- | lishments. | Mr. Gaskill stated that the recovery act allows industries considerable free- Special Dispatch to The Star. dom in rectifying unsatisfactory con-| BALTIMORE, June 17.—An office ditions brought about by unscrupulous | in Washington, for the benefit of Balti- competitive practices. more and Maryland business men wish- Wage rates, commodity prices, and ' ing information on the practical appli- profit margins, Mr. Gaskill said, must cation of the industrial recovery act, be so related as to maintain a proper Wwill be opened Monday by the Balti- balance between purchasipg power and more Association of Commerce. industrial production at ail times. The office will be located in the Mr. Gaskill expressed the view that | United States Chamber of Commerce trade associations and other industrial | Building. groups submitting codes of fair compe- | F. M. Bond, assistant director of the tition as provided for in the act would | Industrial Bureau, will be in charge, | find it advantageous to develop uniform |and will daily keep abreast of all de. | methods of accounting to be followed velopments in connection with the in- | by _all establishments in the group. | dustrial recovery act, the public works Mr. Gaskill declared that in negotia- | bill and similar emergency legislation Itions involving upward adjustments in 'recently enacted by Congress. ‘wngeys, labor must recognize the cost = o e problems involved. Every increase in IDLE COTTON FACTORY PURCHASED AT DANVILLE |costs has a bearing upon the price of | Speclal Dispatch to The Star. the product sold and unless such a price is reasonable, consumption will | be curtailed, and anticipated increases | in employment and in pay rolls cannot be rmllljn'd, };“ ;{ud. Rape ant Members of the Washington chapter — DANVILLE, Va., —Ady attending the convention included Wil- | have. been- recuved . tave (s s Aies liam H. Churchill, C. M. Clark, A. B.| Vista Cotton Mill, Inc., which has been Elizabeth idle for a number of years, has been purchased by the Burlington Mills Co. — -~ of Burlington, C., operators of NEW MONEY |NCREASED numerous factories in the South. The purchase price was not made known. It is learned that the Burlington TO 113-MILLION TOTAL | compapy plans to reopen the mill' for the manufacture of rayon goods as soon as the textile machinery has By the Assoctated Press. been removed and new equipment in- | . New Federal Reserve Bank notes, au- | stalled. It is understood that the deal | thorized under the emergency banking |included the buildings, the machinery, | act, now totals $113,264,000 in actual the good will and the mill village itself | circulation. with 80 houses. All of the regional institutions have availed themselves of the privilege of | D. C. OFFICE TO WATCH INDUSTRY CONTROL PLAN Gunnarson, John Moran, Morris and H. S. Moyer. TRADESTILLGAIS DESPE UNGERTAN WORLD STUATON Growing Confidence Creates Momentum Wiping Out Summer Lull. IMPROVEMENT INDICATED BY DIVIDEND ACTIONS Effectiveness of Industrial Control in Job Relief and Expansion Awsited Next Quarter. BY CHARLES F. SPEARE. Special Dispatch to The Star. NEW YORK, June 17.—In this week of disturbing and unscheduled events Lere and abroad It is encouraging to note that the current of trade still gow: steady and is growing stronger, al- though a weak speculative position in the stock market has been toppled over by the sudden relization that dollar depreciation, on which it had counted so heavily, could not go on forever and that some time there must be “stabili- zation,” whether brought about by the London Economic Conference or other- The temper of the public definitely has turned to one of confidence and expectaticn of better days. It is no longer upset by incidents that were the occasion of much apprehension a short time ago. It studies the daily business records for signs of progress and finds them in many directions. The first half of 1933 is ending with a momentum in industry that should give to the normally dull Summe:- months a greater degree of activity than is generally realized in that period. Dividends Show Recovery. Already the recovery has been suffi- clent to permit a score or more of in- dustrial and public utility corporatians to resume or increase dividends or to pay off a portion of dividends deferred. It is true that other concerns are omit- ting payments on their stocks and that there will be a large number of banks and trust companies whose rates for the June quarter will be reduced or passed. That there is an easing up of the pressure on all debtors is apparent in the smaller totals of real estate fore- closures and in the diminishing business mortality record. Collections are im- proving. In May the life companies wrote more insurance than in any pre- vious month of the year. It is presumed that the effectiveness of the industrial recovery act, in reliev- ing unemployment and in expanding trade, will be apparent by the end of the next quarter. So great a task as it involves cannot be begun without much preparation, so its practical results may appear slow to an impatient people. The same attitude fis to be taken by bank depositors, who were hopeful that the Vandenburg feature of the Glass-Steagall bill would be pre- served and their funds guaranteed al- most immediately. The six months’ delay proposed leaves 9) per cent of bank depesits in their present status and gives the stronger institutions time to consider whether they will accept the plan, which they d t, or go along with it for the sake of general banking harmony. Banks and Speculation. ‘The plan is vastly improved since the requirement that State and non- member banks should at once enter the Federal Reserve System, in order to enjoy its privileges, has been with- drawn. It will not succeed, however, if the door is opened wide to admit hundreds of banks that, even with the recent rise in securities, have a badly impaired capital position. No reform is so much needed, in the cpinion of this writer, as that relating to what had become common banking practices, 'These assisted speculation not only by the banks themselves but by their depositors, In the same manner that credit was extended to the latter when money was cheap and they were not restrained from borrowing to pur- chase stocks on margin. so the banks, in efTect, though not technically, specu- lated in securities when they bought too large a proportion of long-term bonds to their deposit liabilities and their capital and surplus. It has been the banks, to an even greater degree than brokers, who have forced customers with loans secured by stocks to liquidate at the low points of the depression. This now is one of the great tragedies of the times. Many issues have enjoyed a generous recov- ery and would have repaired much of their loss if their owners had been able to hold on a little longer. It is the curse of speculation, but the lesson of it never effects a cure and probably never will. Tax Exemptions Opposed. Eventually the present tax-exempt feature of Government and municipal bonds must be discarded. It is un- sound from an economic standpoint and unjust in its social aspect. The elim- ination of an amendment in the na- tional recovery act, which would have taxed the income on securities now free, was & precaution against possible fail- ure to cover the immediate Govern- ment loans. The decision, however, has only been postponed. It has been claimed that beer and repeal would balance the budget. Equally helpful in pre- serving revenues that should go to the National Treasury would be the imposi- tion of a levy on billions of securitics whose owners escape payment of $650,- 000,000 annually. Former Secretary of the Treasury Mel- lon and his successor, Ogden ~Mills, continually preached a change in the laws that would put an end to whole- sale issues of bonds giving tax immunity to individuals who could and should pay their share of the Federal taxes. The argument that markets for such bonds would be affected if they were to be made taxable is nonsense. The high- est prices ever quoted for United States Government bonds and the issues of the City of New York were those of 30 years ago, long before the income tax laws in_the United States were considered. It obviously would be unfair to make a statute compelling a retroactive tax, though, as an emergency measure, there is the same justification for it as void- ing contracts containing the gold pay- ment clause. Not a little of the prof- ligacy of American cities was due to their ability to sell freely of their secur- ities to investors who considered their tax exemption primary to the credit of the borrower. A sound municipality can always find a satisfactory markes for its bonds. It need not depend on tax advantages to sell them. (Copyright. 1933.) issuing this money with the exception| Men's Clothing Orders Gain. of the Federal Reserve Bank of Rich-| NEW YORK, June 17 (%) —Improved mond. The New York institution has demand for men’s clothing and furnish- placed in tirculation almost one-half ings is reported from all sections of |of the whole, or $53,581,000. the country, with an exceptionally ‘The total amount in circulation is|large demand for men’s Summer cloth- secured by deposit of $149,974,000 in|ing. Call for Fall merchandise con- gomme:::d seclaflties and 'gfiii"’m tinues large, the volume of advance ounted and purchased or & | business being far in excess of last total eolhu?l of $168,365,000, year, ¥ Import Total Mounting. NEW YORK, June 17 (#).—All branches of the import trade are re- ported to have enjoyed a pick-up in demand. Dress accessories, specialty roducts, smokers’ articles and novelties ve increased ix' viume up to 20 per cent, »