Evening star., 1922-12-07
FEDERAL FINANCING
FOR DECEMBER IS
Richmond Bank Directors
Graham Re-Eiected-Mer-
chants Promote Popkins.
HY I. A. FLEMING.

BY I. A. FLEMING.
EankerS believe that Mr.. Mellon mas
again hit the nail on the head IN MS
plaus for financing, announced this
morning They believe that the
three month certificates bearing "'a
per cent interest and one-year issue
CARRYING per cent coupon TO the
amount of si0n.0oo.o00 will be s"H''
but that the demand will not be SUI
fciently urgent to bring q large
oyersubScription, the usual puphc re-
sponse to Treasury offerings.
The failure, in n measure, OF the
last ~. pcr cent bond issue to hold
Mt par or better may have some effect
on This sale.
Eut the 100000 900 in two-and-
a-haif -ycar IL. per cent bonds will he
taken to more than the proposed al
lotmcnt.
bankers believe that this issue will
have the effect of depressing the 44
per cents and of weakening liberty
issues. The Al: per cent two-and-a-
half-ycar bond. tax free as to nor
nal tax and intangible tax as WELL
Is 4 better liifil Il pSA
Sc MT corporate bond.
1t was probable that the Secretary
of the Treasury could not see his way
clear 10 accomplish the needed financ-
ing except as indicated. 1t was
tough problem that has kept the de-
partmeut coGitating for some time.
To-day. however. all government
bonds We're firm.
December Is InaturitieS are very
heavy. Victory IA, per cents that have
M IN ~
Treasury certificates. series T. p.. 1921.
Soi3.5i4 Gao. Az per cent. and series
Il. D., 1922. S200,000 900. 3l4s. mature
also.
There is in the banks at this time
to the credit Of the Treasury 213.22s2.-
Sa1.43, proceeds of the sale of the M
Ier cent Treasury bonds. that will
probably he required to large per-
centage in the financing of the 18th
inst. The last installment of taxes
for 1921. income tax, will be due on
that date-Decenber 10.
Merchants Elects Treasurer.
At Il meeting of the directors of the
Merchants Bank and Trust Company.
held yesterday afternoon, the reSisna-
ton of Frank p Harmon, jr.. as treas
l'ror WAS accepted.
Edwin W. PopkinS who has been as
sistant treasurer of the institution for
years. was advanced to the position
at treasurer. Mr.. Popkins is well liked
i'y he patrons Of the Institution and
has the confidence and best wishes of
mis- associates from President Drury
down.
Richmond Bank Directors.
Edwin c. Graham of Washington
has been reelected 4 director. class
y. of the Richmond Federal Reserve
Bank, practically without opposition,
G. VI. Tilghman of Dunn, n. c.. poll
ing Is votes to Mr.. Graham's 143.
In the election for class a di-
rectors John F. Burton of Wilson,
" G.. also was reelected by 12s
votes to 32 for ". Is. Drake. jr, of
Raleigh. n. c.
Capital Traction Wanted.
There was an especially good de-
Inand for Capital Traction stock on
today's session of the local Stock
Exchange. with advancing prices
from an opening at 1891 to a close
at lof. The buying was generally
of small lots, indicating Investment
purchases.
Trading in Railway common seemed
to Indicate Il desire to bring out some
offerings. for there was little support
back of the shares. sales of very
small lots being made at 6c1z to 63
The stock was offered at 81 from
the recent persistent 67 asked week
or two ago.
1-anston recovered I: point addi-
t!onal of its recent decline, selling at
IL
American Security and Trust Com
nany shares were quite active at 2s1
70 Il firm closing at $50
In the bond section Traction SIS
were sold at 9Ils and Gas ~ notes
at 104.
On stock Dividends.
If legislation is adopted for the
taxation OF corporate surplus as such,
It is hound to have one of TWO effects:
II will either sacrifice unjustly the
interests o< the stockholders whose
total incomes do not make them prop
erly subject To this further levy, or
1T viii force the distribution of the
surplus in cash. which is practically
Impossible in the numerous cases
where the surplus has heen accumu-
latinE for many years. and is invested
IN plant and working capital needed
IN current operations. In either case
the legislation would cause disaster
\ tax levied upon surplus would be
retroactive. reaching back into what
was left from taxation of all previous
years. 1t does not seem possible that
Congress will seriously consider such
proposal, but evidently not a few
members of the next Congress are
considering it.
Although in the case of a new
company surplus account Is some
times started by the sale Of stock at
Z premium. a corporation surplus
usually consists of undivided earn
ings, accumulated over Il term of
years, and, as stated above, does not
exist in cash, but in the plant or
working capital. 1t buttresses and
protects the regular capital behind
the issued stock. preventing its i'm
pairment by unexpected losses. and
this is one reason why it is consid-
cred wise policy to pay in Il moder-