The Washington times., 1920-08-19

|NSUGARDROP
Scores Who Bought Heavily
Caught in slump, U. S.
Officials Find.
By w. ". ATKINS,
International News Service.

Rapid decline in sugar prices. and
an expected drop 10 lower figures, to-
day diverted attention OF Government
officials to probable startling dis
closures OF enormous losses sustained
by manufacturers and dealers OF the
jobber-broker class. Caught In the
sugar price slump are scores or IN
dividuals and concerns who bought
up heavily at top prices and now are
forced TO unload their surplus stock In
a declining market.
Purchasers OF surplus stocks now
flooding the market. were In the gen
eral class of "speculators" referred TO
by the Federal Reserve Board In It's
order to all banks to liquidate frozen
loans" outstanding on commodities
held for speculative purposes. AT the
Treasury Department officials had re-
ports showing that the banks had
called in loans. amounting TO many
millions OF dollars, involving deais
by spectators on necessaries or IRE.
No available figures, however maj
Gated precisely the amounts which
thus were tied up in sugar speculation
alone. But returns from Feoerai
Reserve Banks reflected a very quick
and general response to the boards
appeal to the banks to curb MONIES
sential" borrowings.
SOFT DRINK FIRMS HIT.
Some of the hardest hit among the
speculative element in the sugar mar.
ket, according to the Department or
Justice, were buyers closely affiliated
with the large confectionery and sott
drink industries. They do not stand
alone. as officials were informed that
other Interests" close to the sugar
refiners are due for heavy losses.
Treasury officials were hopeful today
the losses OF sugar spectators Will
be gradually absorbed without en-
dangering the stability OF any OF the
many financial institutions Identified
with the transactions.
The effect OF Governor Hardings
action in putting the brakes upon non-
essential loans, particularly borrow
inGs from banks to aid get-rich-quick
adventurers, gambling in the necessi-
ties Of the people, will be truly re-
Elected in the forthcoming statements
Of the condition of banks under the
supervision of the Comptroller OF the
Currency.
Special reports to the Federal Re-
serve Board also are expected to dis
close accurately the extent to which
the dehation policy of the Treasury
has checked the ilegitimate opera
tions of food spectators. The boards
review of business conditions is eN-
pected to be issued within few days,
presenting some of the outstanding
results of the drive to protect the
public from the extortions Of food
handlers.
EXPECT BANK CALL SOON.
Chief interest at the Treasury now
centers upon the showing to be made
by the banks in response to the next
call by the comptroller for a state
ment of condition of banks. Just
how much paper" was liquidated
under pressure, in the non-essential
group OF loans. will be shown by
these figures. The call upon the
banks to reveal their condition is ex.
pected to be made soon, as more
than two months has elapsed since
the last call. The comptroller is re-
quired by law to make at least four
calls a year. and usually six calls arc
issued. Obviously, great secrecy must
be maintained at the comptrollcr's
office respecting the date OF the call
until it is actually dispatched.
Descending sugar prices and
tendency to lower prices on other
principal commodities. will not cause
the Department of Justice to relax in
its campaign upon proflteers. At
torney General Palmer, though absent
from his post on vacation. gave
specific instructions that agents con-
tinue vigorous prosecution of indi-
viduals and concerns suspected of
profiteering in foods. Particul - vigil
lance will be exercised to prevent
dealers reaping more than a fair mar
gin Of profit fixed by the department.
The departments activity to prevent
price abuses has also led to the re-
lease of large stocks discovered in
the possession of hoarders.