Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1921-06-15
GOSSIP OF
THE STREET

The country is getting back to the
old basis OF real work for an honest |
wage and all communities will be better |
for it, says William A. Laws, presi-
dent Of the First National Bank, in the |
monthly letter on the business and
financial outlook issued by that institu-
tion, People are stabilizing their
thoughts, as well os their Methods" he
continued, "and the ultimate consumer
is coming into his own again. No one
is buying thoughtlessly these days, but
everybody Is taking care to get ons
hundred cents of value in every dollar
Of merchandise. This represents an
extraordinary change from n year or so
ago when most of the 81 900, 900 fam.
ilies in the United States were buying in
the happy go lucky fashion which made
deception and unjustifsble price I'D.
vances not only possible, but the easiest
thing to put over. The average man
these days Is looking for quality in.
stead Of quantity and driving as good
a bargain as he can get.
Laid Away for the Rainy Day
Managers Of some few Of the indus
trial concerns apparently enjoyed tho
rare foresight to 10y away for the
Of abnormal big profits during the war
period. This apparently applies to sew
eral Of the so-called equipment COM
panies, notably American Car and
| Foundry, American Locomotive and
Baldwin Locomotive. Interesting figures
as to the last named company's opera
tions have already been printed. 1t was
stated yesterday that the American
Locomotive Company since the first OF
the year has purchased some SIS, ,0O0,-
900 treasury certificates Of indebted
ness. 1t was pointed out interest on
this one item represents about hall
years dividend on the company's pre-
fcrred stock II is reported the com.
pany has os much agnin in other in.
vestments paying higher interest and
cash. Some time ago an interesting
story was told on the street of the
| American Car and Foundry Co. being
large lender Of funds in the coll money
market, and profits obtained from these
| operations were nearly sufficient to pay
the yearly dividends on both classes oi
the company's shares, besides helping
to relieve an otherwise serious situa.
ton In loan market.
Dividend Changes Unavoidable
Discussing the probability Of a re-
duction being made in beth the Great
Northern and Northern Pacific divi.
J dends, a prominent local financial in.
tcrest, who is also director of several
railroads, said yesterday such action
would not surprise him in the least. and
furthermore he expected radical divi-
dend changes to be made by other rail-
roads. You cannot pay ont something
you do not earn, and the conditions are
such as to make most boards Of man
ayers reluctant in dipping into accumu
lated surplus to pay unearned dividends.
The railroads, you must remember, will
not receive the slightest benefit Of re-
duccd earnings or other adjustments
changes do not go into effect until July
]. In the meantime, business and
industrial conditions are going from
bad to worse. If the leading
industries are only working 20 to
20 per cent of capacity, It means
the traffic on the various rail
road lines will be reduced proportion.
ately, and in turn earnings will shrink
correspondingly. Furthermore the i'm.
n result of the rigid retrenchments ap-
piled are apparently not being main.
tanned, and from what figures there are
at hand, May returns will be disap-
pointing. There Is still much to bc done
in the readjustment. and dividends must
suffer in consequence. 1t is hard foi
many investors, but it Is an unfortunate
condition that hardly could have been
fOreseen.'
One Sore Spot Removed
Reports that were current n littl.
over n week ago concerning an impor-
tant financial combination having taken
steps TO strengthen the position of q
more or less prominent institution had
a sequel in other reports which were
current after the closing Yesterday ia
the effect that the head of the same in.
Stitutian had taken vacation and
would be away from business cares for
the next two years. 1t was thought
that much Of the liquidation on Monday
was connected with some incident OF
this kind, on which the public has no
general knowledge, but which for o
time had an important influence on
prices.
Proposed Cuban Loan
According to report circulated yes.
terday in local banking circles. Cuba
has been invited to consider loan for
500 .000, 900 or more This story ap.
parcnty was prompted because Of the
conference which was held in New
| iVih DS
interests concerning the Cuban situa.
ton. Consent Of both American and
Cuban Governments would be a neces.
sary preliminary in such negotiations.
It is understood Cuba is willing, but
Washington has not yet signiied its
approval.
Those familiar with the unfortunate
Cuban situation assert the proceeds Of
such loan could be used advantage
ously by the Cuban Government to aid
the present dcmoralized condition Of
the sugar industry. Project for a cen.
tral bank Of issue could be carried
forward. Cubn at the moment is Suf-
fering from a currency panic and lack
of banking facilities in the present
crisis rs well ns low sugar prices.
Either directly or through the new
central bank supervised by American
managers loans could then be made to
sugar producers on ample security,
thereby relieving the banks in this
country which have been carrying the
brunt of the b"rden.