Evening star., 1913-12-30
Heads of Leading Local Insti-
tutions Claim They Would
Lose Heavily.
SIGNS OF PROSPERITY
ARE PLAINLY SEEN
Commercial National Bank Digest Is
Encouraging-Wall Street
Window Dressing
BY I. A. FLEMING.

the 1ederdI reserve system.
The subject has been considered by the
heads of these institutions very carefully
and the general opinion is that they
would be heavy losers and in no way
gamers.
Under the new law they would be
obliged to carry 10 per cent reserves on
demand deposits and per cent on time
deposits in their own vaults-idle moneys
upon which they would not be able to
make profit.
At the present time the reserve is usu-
ally carried with some other trust COM
pany or national bank, and earns good
interest One large trust company esti-
mates The loss from this sinterest-payment
business, should it go into the reserve
association, at about $4,000 a year.
Moreover, a large amount of cash would
have to be invested in TIE regional bank
of this district.
The provisions OF the new law do not
permit of rediscount OF notes secured by
collateral. Several " ashington trust
companies lend only on collateral-never
on accommodation notes or commercial
paper. Had the guarantee of deposits
been incorporated in the new law 1t prob
.ae system, as it would be strong
advertising point.
Washington certainly should have a
regional bank. Philadelphia and Balti-
more are in the fight. Boston and New
York are practically assured of a regional
bank. Philadelphia may be given rec
ognition, but not Baltimore and Phia-
delphia, nor yet Baltimore and Washing
ton.
AS the capital of the nation, the seat
of the federal reserve board, the home
of the Treasury Department and as the
nearest point to the southeastern sea-
board and Virginia, West Virginia. etc,
the bankers in this city believe that they
are entitled to representation.
The General Accident. Fire and Life In
surance Corporation of London, owners
of the Potomac Insurance Company OF
Washington, have just completed the
transfer of $4,000 to the credit or the
surplus account of the local corporation.
Thomas c. Moore has been made gen
eral manager of the Potomac Insurance
Company, coming to il with long prac-
tical experience as superintendent of the
Canadian agencies Of the German-Amer-
lean Insurance Company.
The Potomac Insurance Company plans
to broaden its field of business, which is
entirely confined to District business, but
will not make any movement in that
direction until its surplus account
reaches the ACKNOWLEDGEMENTS nd-dollar
mark.
Former Senator Nathan B. Scott. prest-
dent of the Continental Trust Company,
sustained minor operation this after
noon. He expects to be able to attend
to business in the immediate future.
Augustus Crane of Crane, Paris & Co.
returned to the city from New York
this morning.
President Bell of the American Security
and Trust Company, President Woodruff
of the stock exchange and William A.
Mearns were out of the city.
Disbursements in New York city Incl
dent to January / payments will total
about $13OOOO,ODO. Washington this
morning received checks in payment of
many dividends especially ON holdings
in the steel corporation.
Wall street started the usual end of
the year window dressing" movement
to induce reinvestment of the large
dividend and interest payments. Prices
on the leaders were decidedly strong
with la11sa2 point advances quite
generally.
1t Is admitted that the currency law,
when effective. will give general re-
lief and prevent stringency. But the
condition of the railroads of the coun-
try has not materially improved. Their
net earnings show decreases, and the
slow and deliberate manner in which
the question Of an advance in rates is
being considered has caused doubt that
has not heretofore existed on the part
Of many friends of the railroads
The new currency measure has not
provided the new capital, SO sadly need
ed by the enterprises of the nation, and
especially the railroads. who are cal ed
upon to meet many obligations, and find
difficulty in securing extensions in max
ing financial arrangements therefor.
Mortgaging the future has been easy
work in the past. also decidedly fashion
able. But the payday rolls around and
then the difficulty. There is consolation
in the fact that the adjustment has
placed securities on a good income basis
that should be inviting to investors-both
on Wall street and in Washington.
With the first of 1914 comes the burden
of the collection of income taxes on the
banks Of the country, with more pres
sure than with November or December
payments.
1t is figured by the big institutions of
New York that they will have to pay
for the collection from two to five times
Many collections are made upon which
no tax is paid, and the exemptions make
| the total of non-taxable collections much
larger.
The December Digest of Trade Con-
| ditions, issued by the Commercial Ma
tional Bank, is more encouraging than
for several months.
Digest:
| "a great deal has happened within the
| last month to reassure business men
/ about the future. With the enactment
/ of currency Law, which is, on the whole,
/ well suited for the people, will come
the gradual restoration OF confidence and
| the sort of reinsurance which almost in
| variably bespeakS a business revival The
| reaction already witnessed has not gone
far enough to paralyZe trade; a very de-
| cided depression in business has, how
| ever. resulted, influenced largely by the
| laying off of the large number of men at
many of the manufacturing centers. With
the new financial law on the statute
| books however. and business men fast
| adjusting their affairs to comply with
| the conditions caused by the reduction
| of the tariff, il is safe to expect Il de-
i cided improvement in business, with in
shown rather pronounced depression OF
| late.
In the territory around Washington
| such business recession as has taken
| place has not had very pronounced
| influence upon the community. The
| south is prosperous except in the small
| area where flood damage and other
| setbacks have been reported. But the
| unprecedented movement of cotton tc
| market with the indications that the
| crop will represent q very high money
helping sentiment. People throughout
this section, therefore. are inclined tC
take a hopeful view of the new year
and believe that 1t will see the restora-
| tton of confidence with better business
| than the country has witnessed since
the panic disturbance.
"Underlying conditions are all right
and people are living within their mean:
to a greater extent than has been the