The sun., 1919-06-11
BANKS GET PROBLEM
In WHISKEY LOANS
100000 Advanced on
Warehouse Receipts With
Dry Period Near.
HUGE STOCKS ON HAND
Dealers, However, Show No
Disposition to Unload
Prices Stay Normal.

The banks Of the country hold about
sbs.ooo,ooo OF whiskey warehouse re-
ceipts. for which. in most instances. the
whiskey itself is their only security.
These figures were advanced by a broker
IN close touch with the whiskey situation
yesterday as one of the imperative rea-
sons why the trade should be given
until January. when the prohibition
amendment to the Constitution goes into
effect, to dispose OF the stocks. So con-
fident are dealers of this position that
there Is not the slightest evidence in
any powerful quarters to unload stocks,
and whiskey prices remain flrm.
In addition to between $4,000, 900 and
100000 gallons in the bonded ware
houses It was learned yesterday that the
distributing and retail trade has about
100000 gallons on its hands The
Government tax OF $40 a gallon has
been paid on the stock in the hands of
the distributors. but not on that in the
bonded warehouses. 1t Is now esti-
mated that approximately 1,0oO,0 900 men
will be thrown on the labor market IL
war time prohibition Is made effective
July /.
In the face OF these figures the whis-
key men were distinctly optimistic YES
terday in their belief that either Con-
gress or the President would do some
thing to relieve them of the difficulty In
which they have been placed by the Inn
position Of the war time prohibition act
on top Of the Federal amendment.
Want Another Six Months.
Had the Federal amendment alone
been allowed to stand the whiskey men
say they would have disposed of enough
OF their stocks to pay their debts and
at least get out of the business by the
end of the year at the normal rate of
consumption.
If the majority Of the people OF this
country do want whiskey prohibited"
said T. II. King. a whiskey commission
man, at so Church street, most of US
are perfectly willing to close up shop
and try our hands at something else de-
spite the fact that we have been In a
hitherto legitimate business most OF our
business lives. But we do think Il is
palpably unjust to take our property in
this manner without any compensation.
There was only one other instance of
that 1 believe, and that was when the
slaves were freed"
According tn figures Of the internal
revenue department cited by Mr. King
there are between 55.oo0.o00 and so, o00,-
600 gallons OF whiskey in the bonded
warehouses now as against 1s4.000, 900
gallons on June 80. the end OF the fiscal
year of 1911, and 1853. 100000 on the
same date in 1918. Its value is about
$oo.00o.ooo with no taxes paid. The
banks have made loans Of about Is per
cent. OF this sum with the warehouse re-
ceipts as collateral.
Normal consumption has been about
100000 900 gallons a month with with
fdrawals from bonded warehouses at
about the same rate until the price of
whiskey increased with the additional
| tax when consumption fell of two or
three million gallons a month and with
drawals from bonded warehouses drop
ped to 100000 gallons for March as
against about 100000 gallons for the
| same month year ago April with
drawals were $4,000 gallons.
With practically all the National
Guard and National Army troops home
from Europe and with the completion
Of rehabilitation certain before the first
OF July. the whiskey men believe the
President will abrogate the war time
prohibition act by proclsiming the end
OF rehabilitation as soon as the peace
treaty IL signed. Delays in Paris have
convinced the whiskey dealers that there
Is no hope of final peace before July /
but even II Congress does nothing they
are counting on sitting tight and wait
ing for action on the fnal signature OF
peace any number OF days later, or
about the first OF August.
Under these circumstances there Is
no disposition to unload. There is no
frantic effort anywhere TO dispose OF
stocks, and whiskey prices remain about
normal This was illustrated by a pub
lie sails Of seized imported liquors con-
Quoted by customs officials yesterday
Imported gin, Scotch whiskey and
liquors sold for prices measurably APP
preaching those prevailing in the mar
ket, although all Of the lots went to
private persons in search OF bargains
with which to stock up against the COM
Ing dry spell.
1t was explained yesterday that the
present holders of the whiskey have been
thu ough recent period of prosperity
In which all OF them have made money
and that they are taking a fair chance
~ holding the stocks. either for normal
disposition before January l should the
war time prohibition act be withheld
or for claims against the Government
fol- the destruction OF their property
at later date.
Should II be necessary to close down
tn" liquor trade after July /, with the