Evening Star Newspaper, October 27, 1935, Page 4

A—4 » S.E.C.LEVELS GUNS AT STOCK TRADER Michael J. Meehan Faces Ouster Threat Based on Alleged Deals. By the Associated Press. The Securities Commission yester- day ordered Michael J. Meehan, vet- eran stock market operator, to show why he should not be expelled or sus- pended from the New York Curb and other exchanges on charges of manip- ulating stock of Bellanca Aircraft Corp. Meehan, disclosed by the 1933 Sen- ate stock market investigation to have been active in many big pools in pre-depression days, was ordered to appear November 12 to explain what the commission said it had “reason to believe” were illegal activities de- signed to raise the price of the stock. The alleged manipulation, the com- mission said, purportedly began on the New York Curb Exchange on April 5, 1935, and has continued to the present time. At the same time, the commission halted the flotation by the company of 197,500 new shares of the same class as those being traded in on the Curb in which the alleged manip- ulation has been occurring. $5 Sale Price Planned. Most of the new issue was to be bought from the company by Meehan and Hamons & Co., underwriters, at 84, and sold to the public at $5. The old stock has had a range of from $1.75 a share to $5.50 so far this year. Two days ago it sold around $5, closing Friday at $3.75, and yesterday at $2.75, the latter quo- tation appearing on the tape shortly after the commission’s announcement. Without giving details, the commis- sion said it “has reason to believe” Meehan used the mails and other in- struments of interstate commerce to create “a false and misleading appear- ance of active trading” which had the effect of “raising its (the company’s stock) price for the purpose of in- ducing its purchase by others.” Act Held Violated. ‘This was done, the commission said, by Meehan's issuing orders to sell or buy with the knowledge that other orders were outstanding to buy or sell at substantially the same price. This was called a violation of the exchange act under a section which forbids transactions involving no change in the actual ownership of the stock. This process is described in stock market parlance as matching orders, wheréby, in the simplest sort of case, the same trader would enter an er to buy and an order to sell the same number of shares of a stock at the same price at the same time. There would be no change in owner- | ship. The same result might be ob- tained by several individuals agreeing among themselves to buy and sell without actually changing ownership, thus creating unreal activity in a stock and raising or lowering, as desired, its market price. “Untrue Statements” Alleged. The registration statement for the new stock would have become effect. THE SUNDAY STAR, WASHINGTON, Sk ',"a LA s &t ‘cutting her wedding cake yesterday At left: Mrs. Frederick Hayes Warren, formerly Miss Marie McIntyre, Teft to right: Mrs. C. J. McLees, mother of the bridegroom; Mr. Warren, Mrs. Warren and Mr. and Mrs. Marvin Mclntyre, father and mother of President Roosevelt's secretaries. Mrs. Roosevelt Attends McIntyre Wedding of the bride. Mr. McIntyre is one At right: Mrs. Franklin D, Roosevelt arriving at the wedding. (Story in Society Section.) —Underwood & Underwood Photos. Corn-Hog (Continued From Firs | farmers increasing incentives for con- | servation and efficient use of the Nation's soil resourc In addition, the President suggested the time may come when the A. A. A. will work to | increase crops, and there will be a | decentralization of farm control by | the Government so it will be managed { locally to a greater extent, rather than | from Washington A month ago in these columns it was predicted that the administration would seek to improve and change its farm program, getting away from the principle of crops curtailment as the principal basis for the payment of Government benefits to the farmers. | The President’s statement may be in- | terpreted as indicating such a change | is now strongly in contemplation. He said: “The long-time and more permanent adjustment program will provide i incentives for soil conservation. The benefit payment: can be made on a basis that will en; courage individual farmers to adopt Page.) sound farm management, crop rota- | | tion and conservation methods.” Republican speakers have taken ad- vantage of the dissatisfaction which | has arisen outside of the farm areas ive today and the stock might have | because of the high prices being asked been offered to the public tomorrow. ‘The commisison said it found “reason- able grounds for believing” the state- | ment contained “untrue statements,” or omitted to state “required material facts.” The parts of the statement objected to dealt with the stock holdings of officials, and with the agreement be- tween the corporation and Meehan and Hamons for selling the stock. The other exchanges from which Meehan might be expelled were the New York Stock Exchange and Chi- cago Board of Trade. METEORIC FIGURE IN 1929, Meehan Took Part in Bull Market With Radio Boom. NEW YORK, October 26 (#).—M. J. Meehan, who was ordered by the Se- curities and Exchange Commission to defend his right to continue as an active member of the New York Stock Exchange, Curb Exchange and Chicago Board of Trade, is the senior partner of the Wall Street brokerage firm bearing his name. He was one of the meteoric figures of the 1929 bull market, and on the Stock Exchange floor at that time his name was associated with the boom in Radio Corp. of America common stock, which for a brief time before the market's collapse produced a quoted value of more than $540 a share. To the commission’s complaint he ave this answer tonight: “I have been informed that the S. E. C. claims to have found some basis for com- plaint against me in connection with Bellanca Aircraft Corp. “I am prepared to prove at any time that I have not, wittingly or unwittingly, violated any of the pro- visions of the securities and exchange act, or the rules of any exchange of which I am a member.” Had Vision of Future. His friends said it was his vision and imagination which turned him to Radio common. It had been a rela- tively obscure issue with colorless market sponsorship. Even after Mee- han took it under his wing shortly after joining the exchange in 1920, it remained a “sleeper,” until he began to dramatize his unlimited confidence in the company's fulure. Meehan was then about 35, red- headed, stocky, with a genial and friendly way which won him many friends in Wall Street. He needed his prodigious store of physical energy to run the market in radio in those turbulent days. Daily then it was his experience to be mauled and clam- bered over by a milling crowd of brok- ers about the Radio post with selling orders to fill the rising bids of Meehan. He was the recognized specialist in the stock. Began as Messenger. He started his Wall Street career as a messenger. He was successively & cigar store clerk and salesman in a theater ticket agency located in the Wall Street district. He had am- bitions to become a broker, and by 1918 he had saved enough to buy a membership in the old Curbs Market, which operated between the curb- stones of Broad Street just below the Btock Exchange. Since the depression Meehan had been less in the limelight, but this was also true of most other Wall Street figures who achieved prominence in the bull parket days. The ic move of the 8. E. C. came as a surprise to the Stock Ex- change authorities. Charles R. Gay, president of the institution, explained that the first notice of any investiga- tion of Meehan's transactions came in » telephone message from S. E. C. Chairman Landis late yesterday. . for food. They have stressed the fact that pork has practically doubled in | price to the consumers and that prices | of other foodstuffs have been rising. | The Democrats are not unmindful of | the fact they must hold the votes of | the people of the great industrial | States as well as those of the farm | States if they wish to keep their present control of government. There is a feeling growing that con- sumers of food do not look kindly on the payment of Government checks to the farmers for failing to produce their usual crops. The consumers are paying for these benefits to the farm- ers, not alone in higher prices for their food, but also through the proc- | essing taxes, which in themselves are helping to increase the prices of | foods—according to the Republicans. | The Republican National Committee, not unmindful of the effect it may have on the popular regard for the administration, has seized on the record of American exports and im- | ports of farm products in September, | 1935, as compiled by the Bureau of | Foreign and Domestic Commerge. In | a statement issued last night the com- mittee said: | “From an agricultural standpoint, it | is probably the most dismal record | that has been written in the last 50 | years. In September the United States for the first time since the Civil War, if not for all time, imported more | farm products than it exported. { Sees U. S. Losing Title. | “That sounds incredible in view of | the fact that ever since the West was | opened immediately following the Civil War the United States bore the proud title of being the granary of | the world.” | Under the New Deal policies of the last two and a half years, however, agricultural exports have been steadily declining and our agricul- tural imports have been steadily in- creasing. The policies of the A. A. A. are swiftly destroying the farmer’s foreign markets and gradually de- | stroying his domestic markets. | “The month of September shows our exports of animals and edible animal products, meat products, dairy products, lard and fish, to have | amounted to $9,307,000, while our imports of the same articles amount- ed to $10,253000. The exports of vegetable food products and bever- ages, grains and grain preparations, fodder and feeds, vegetables and vegetable preparations, and edible vegetable oils, amounted to $21,978,~ 000, while our imports of the like articles were more than double that— amounting to $48.161,000. “When the American farmer sees the imports of agricultural products, both raw and finished, are nearly twice the exports of like products, he should begin to do some serious thinking regarding the policies of an administration which makes this possible.” With the sacrifice of agricultural production in this country through crop curtailment, the antagonists of the A. A. A. say, there has come imncreased foreign competition in the production of agricultural commod- ities. Foreign nations have increased their crop acreage as the United States has decreased its acreage. Trade Barriers Blamed. The proponents of the A. A. A. program insist, on the other hand, that trade barriers erected by foreign nations have been responsible for the falling off of American agricultural exports. They do not see any pros- pect of (regaining these foreign markets unless these trade barriers are removed. And there segms to be no -immediate chance of breaking down these barriers. The Republican National Commit- N | there | though it be a minority vote—recorded | some corn and hogs. When a similar | tee, in another statement, takes a crack at a claim made by the A. A.| A. it one of it§ releases, that the wages of factory employes have keth | pace with food prices, and that the employes therefore have not been in- | jured by the higher food prices due | |to the A. A. A. program. The Re-| publican committee suggests that the | factory workers themselves be asked ; if their wages have increased corre- | | spondingly with the increase in prices ! el of foods. These increases, up to Sep- tember 24, 1935, have been, the na- tional committee says, using the last issued by the Bureau of Labor s, as follows: Cereals—White bread, 4.3 per cent; corn meal, 29 per cent; rice, 25.4 per cent; rolled oats, 17.2 per cent. Beef—Chuck roast, 519 per cent; plate beef, 62.6 per cent: rib roast, 419 per cent; round steak. 39.8 per cent; sirloin steak. 33.9 per cent. Pork—Bacon, 99.6 per cent: sliced | ham, 63.4 per cent; pork chops, 64.3 per cent. Dairy products—Butter cent; cheese, 9.4 per cent. Eggs, 32.4 per cent, Lard, 131.3 per cent. Vegetable lard substitute, 18.9 per cent. Oleomargarine, 42.2 per cent. Inconsistency Charged. The Republicans also are saying the A. A. A. is blaming the higher prices of meat and other food prod- ucts on the drought, when talking to consumers in industrial States, and are praising the increase in farm prices to the farmers in the agricul- | tural States, alleging that these higher prices are due to the A. A. A. program, | The battle over the A. A. A is ap- ‘ parently growing hotter, despite the fact that many Republicans from the farm States, like Senator Capper of Kansas, give the program their bless- ing—or are reluctant to attack it. The corn-hog vote of yesterday be- comes all the more important since, if the administration carries its point strongly, the result will be widely in- terpreted as meaning the farmers gen- erally are in favor of it. If, however, is a substantial vote—even | Corn-Hog Votes Part Returns Favor Con- trol Program — Illinois Ballot Appears Largest. By the Assoctated Press. The vote of producers in the refer- nfilm for or against a corn-hog pr8duction control program for 1936 | under the A. A. A, as compiled by the Associated Press at 1:30 this morning, was as follows: State, Yes. Tllinois 21,248 Nebraska .. 14774 Kansas . 13106 South Dakota - 2,392 Indiana Towa Minnesota Maryland - 35 Virginia 96 Wisconsin 91 Georgia - Colorado West Virginia Montana Pennsylvania Wyoming . 6 10 E 29 10 = | Totals . 18,291 | A light vole might have been an un- favorable sign. The new corn-hog contract for 1936, it is said, will provide for a 25 to 30 per cent jmcrease in hog production over this year. It is possible that the | A. A. A. will offer a four-year con- tract if the program is approved in | the referendum of yesterday. The 1936 | program is desired particularly to pre- | vent a heavy increase in the corn crop, which would bring a surplus of hog production in 1937, since the corn goes largely into feediog hogs. against the program, the interpreta- | tion will be just the contrary. Another question is the proportion of the farmers who actually take part | in the balloting. If there is & large number of farmers who do not trouble to go to the polls, how will their si- lence and apparent indifference be interpreted? There are in the United States 4,500,000 farmers who produce | referendum on the 1935 corn-hog pro- gram was held a year ago, 579,716 voted, and the program carried by a good margin. The vote stood 389,139 for the prpgram and 190,577 against it. Heavy Vote Reported. The polls did not close last night until 10 o'clock. Early reports indi- cated the vote had been heavy, ac- cordiag to the Associated Press. This was taken by administration officials as indicating the program would win. STORE IS DESTROYED BY FIRE AT MARSHALL Loss Is Estimated at $30,000. Customers Escape Withe out Injury. Speclal Dispatch to The Star.” MARSHALL, Va. October 26.—A fire of undetermined origin tonight destroyed the F. R. Johnson Dry Goods Store here, causing a loss esti- mated at $30,000. Although 30 or 40 late shoppers were in the store when the blaze broke out at about 10:45 p.m., all escaped without injury. The store was a two-story frame structure. Fire departments from ‘Warrenton, Leesburg, Front Royal and Winchester responded to the alarm and arrived in time to save a garage adjoining the store. Hurricane (Continued From First Page.) government is trying to get aid into the stricken area. Roads Are Impassable. (The hurricane presumably was the same one that passed through Eastern Cuba and Jamaica last Monday, re- sulting in the deaths of four persons. Damage in Jamaica was estimated at $2.500,000.) Roads are impassable to Haiti’s southern peninsula. Fragmentary news is coming through by couriers, who are traveling overland with the great- est difficulty. The Standard fruit steamer. ton, from Tampa, arriving he afternoon, will take relicf to Jacmel and Jeremie. raphic communication with Cayes was re-established. Damage to city was not e nsive, but a fam- e was feared, b e of the destruc- tion of food crops. Hydroelectric Plant Razed. The hvdroclectric plant at Jacmel was reported destroyed, and the town was without light or water. A bridge over River was destroyed in the Jeremie district. The Voldrogue and Roseaux Rivers overflowed. It will be days before an accurate Trux- a- check of fatalities and damage can | be made, officials said. TWO MORE DIE IN CUBA. Death Toll at Santiago Now Stands at 17. SANTIAGO, Cuba, October 26 (P).— Rampant rivers of Oriente Province claimed two more lives today. send- ing the death toll resulting from last week’s storm to 17. In the township of Ramon Vaguas a man was killed when flood waters undermined the walls of his home, causing them to collapse. The body of & woman was found floating in D. C, OCTOBER 27, 1935—PART ONE. GENTRAL MISSION INDORSES SAFETY Civic and Fraternal Leaders Among Guests to Back Safe Traffic. With a declaration a rescue mission is as much interested in saving lives as it is concerned with saving men’s souls, the Board of Directors of the Central Union Mission and several hundred guests at a banquet at the Mayflower Hotel last night unani- mously indorsed The Star Safety Campaign and signed their personal safe-driving pledges. The presidents of 20 civic and fraternal groups of the District were among those who pledged support, The banquet, commemorating the fifty-first anniversary of the Central Union organization, was held in honor of Supt. and Mrs. John 8. Bennett, who have just concluded their twen- tieth year as directors of the house, at 613 C street, which provides food, shelter and opportunity for religious worship for homeless men. Pledge Gratifies Brown. Homer Rodeheaver, song leader at the banquet, remarked that the Cen- tral Union Mission is in the business of saving souls, which is closely allied with the business of saving lives. Maj. Ernest W. Brown, superintendent of police, expressed his gratitude to the assembly for the pledge of co- operation. Included among the representatives of Washington women's organizations at the dinner, who announced their intention to support the drive, were District Federation of Women'’s Clubs; the Soroptimist Club: Miss Mae Mur- ray, president of the District of Co- lumbia Business and Professional Women’s Ciubs; Miss Ethel Bagley, | president of the Business Women's | Council, and Miss Dorothy K. Butler, |first vice president of the Women's City Club. Mrs. Lloyd Biddle, president of the | Miss Marjorie Webster, president of | PWA. STRIKE SEEN AT CUMBERLAND Workers Will Not Return to Jobs Unless Demands Are Met, Say Leaders. By the Associated Press. BALTIMORE, October 26.—Mary- land’s first strike on a Federal work- relief project appeared certain today as the deadline set by Cumberland authorities was reached and Federal officials still held firm in their refusal to reduce hours of work on the Cum- berland Works Progress Administra- tion projects. City officials and labor leaders in Cumberland have said that if their demands are not met the relief workers of the city will not return to their jobs on Monday. They ask a reduction of the number of hours to be worked per month from 120 to 80. Francis H. Dryden, State W. P. A head, has replied to these demands by asking who will furnish the extra money needed if the hour-decrease is granted. The Federal Government has allotted a set sum to each project, and the job must be completed with this money, Dryden says. The requested decrease in hours will raise the cost of the project by about 40 per cent. Cumberland has, by an act of the cents per hour as the wage to be paid workers on public projects. Dryden maintains that the $40 per month paid relief workers cannot be fairly re- | duced to an hourly basis, as his men | are paid whether bad weather keeps | them from working or not. Cumberland replies by saying the W. P. A. is paying full market prices | for materials and tools, and should pay the market price for labor. Hovering over these claims and con- tentions remains the threat of work cessation. Both sides are convinced that the laborers will actually refuse to return to work if the negotiations fail, as seems likely. Civic Groups Join. Leaders of outstanding civic groups who made their pledges toward safe driving last night were Arthur J. Richards, | Club; Harold Marsh, president of the | Kiwanis Club, and J. G. Yaden, presi- dent of the District of Columbia Fed- eration of Citizens’ Associations. Representatives of religious organi- zations present included Dr. Page the Grande Anse ' McK. Etchison, religious director of president of the Civitan | The question of the attitude of re- lief authorities in case of a strike is still unsettled. These officials prefer AMERICA'S FINEST VALUE SINCE 1857 {the Y. M. C. A and president of the | { Organized Bible Classes of the Dis- trict of Columbia; Mrs. Magdelene C. Fisher, superintendent of the Baptist Home for the Aged; Rev. Freeley Rohrer, president of the Ministerial Council, and leaders from the Mount Vernon Methodist Episcopal C! th, the Calvary Baptist Church, the National Baptist Memorial, the Metropolitan Presbyterian, the Wom- en’s Guild and the Evening Auxiliary of the Central Union Mission, — | the Safua River near the township of Esteron. HONDURAN TOWN PERILED. Rising Flood Waters Break Wires From Progreso. TEGUCIGALPA, Honduras, October 26 (#)—A telegram from the town of Progreso today said rising flood waters were endangering the city and lives of the residents. The message reported waters had reached the telegraph office at the time, 11 am. Immediately afterward | communication was interrupted and it was impossible to obtain further contact, Deep concern fate of the pop s felt here for the n of Progreso. CROP DAMAGE IN JAMAICA. KINGSTON, Jamaica, October 26 ().—The damage in the recent hur- ricane to present and coming banana crops was placed teday at $4.000,000. THE CADILLAC V-8 COUPE (Series 60) last Legislature, & minimum of 50 | |to make their decision known when | the situation has actually arisen. | A wider significance of the strike s in its effect on workers on other W. P. A. projects. Joseph P. Mc- Curdey, head of the Maryland-District of Columbia Federation of Labor, is backing the Cumberland authorities. Widespread W. P. A. strikes already have been forecast by McCurdey. e STAB UNNOTICED NEARLY FIVE HOURS Victim of Fight Treated at Hos- pital for Serious Wound in Abdomen. Nearly five hours after he was }trealed for a slight cut on the neck | received in a fight with an uniden- | tified colored man, George Redmon, | 32, of the first block of Randall place southeast, last night discovered he | had been seriously stabbed in the abdomen. | After treatment at Casualty Hos- | pital for the neck slash, Redmon was sent to the first precinct for ques- tioning. During his interrogation Redmon noticed his shirt was wet with blood. He was driven to Gallinger Hospital, where physicians found he was suffer- ng from a gash that encangered his life, Redmon told police he received the wounds in a fight in the 200 block of Massachusetts avenue. Academy Seniors Elect. 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