Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-04-14
HIGH CALL RATE
ECHOED IN CAPITAL
Local Institutions Are En-
ioying Unlocked for
Prosperity.

Generally speaking there is, as rule,
very little sympathy of action between
Wall Sire and the Washington secur-
tiles market Shares on the local list
have nothing of the speculative charac-
ter of many on the larger bourse and
price fluctuations are confined to frac-
tons, save on important developments.
Recent wild fluctuations in call money
rates and the pinching of credit gener-
eily were important enough TO have
some effect on local stocks and a
greater influence on banking funds.
Speculation and investment opera
lions, some of the latter on sufficiently
large margins to entitle them to recog-
milton as such, have not been confined
to any section on the recent active
movement in Wall Street but rather to
the entire country and Washington has
been one of the most active centers.
Buyers, too, have held on desperately;
they have not sold out on the breaks
With their usual rush when annoyed by
margin calls but seem to have faith in
. comeback of prices but they sQuirmed
under the press of high money rates.
generally pressed a little above call
rates by brokers for their own trouble
in financing trades.
Liquidate Good Securities.
In their trouble they have liquidated
good securities which they did not have
to sacrifice, Washington bank shares,
fractions, gas stocks and other stocks
and bonds on the local list, ana this
selling has been attended with small
price concessions put actually unim-
portant, compared with the breaks on
Wall Street.
Washington bankers were also APP
pealed to in an attempt to shift all or
part of the load of carrying stocks from
brokers' accounts to their more mode
rate demand accommodations.
Where the applicant was entitled to
consideration, where the balances were
sufficiently "compenSating," the request
was courteously treated but otherwise
there was no cash for the Spectator,
nor were funds obtainable for enlarged
speculative purposes.
Merchants have found no trouble in
securing accommodations at normal rates.
6 per cent being the ruling figure, but
other applicants have, in some instan-
ces, been compelled to meet advances
to Z, 8 and occasionally even higher
rates.
This has been the rule in other cities
as we'll, with applicants endeavoring to
shift Wall Street loans, but in the ag-
gregate these efforts 10 escape hign
rates must have been something OF a
factor in the money market.
Banks Enjoy Prosperity.
With such an urgent demand for
money as there has been from stock
market traders, with fair inquiry
from commercial sources, bankers nave
enjoyed a degree of prosperity that
they had not expected.
When the year 1928 was drawing to
its close bankers were quietly discussing
among themselves methods TO overcome
the high interest raLes they were forced
to pay on savings and some other de-
posts, interest tnat accounted for one
third OF the entire expense of operating
their institutions.
Demand money was freely offered at
512 and per cent and time loans at
per cent. The former Is tight now
win per cent the minimum and Z
ana per cent hign. Time loans are
still being made at ., with some higher
figures.
assurances Companies Lenders.
In the monetary stringency the great
insurance companies or the country
have not sought the high rates for
their surplus funds but nave continued
TO offer cash in almost any amount on
1irst mortgages, high grade, at 5l2 per
cent, in marked contrast to many OF
the big industrial companies that nave
competed with the banks In supplying,
at a price, the nedS of the security
SPECTATORS and operators generally.
Some OF our local banks have been
free lenders, using the rediScount prlvl-
leges of the Richmond Federal Reserve
Bank, but it is also fact that num-
Der Of our largest institutions have not
rediScounted any OF their bills, which
means that they have not taken ad-
vantage of their right to borrow at the
current low rate at Richmond to lend
at the high rates that have prevailed
on Wall street.
Capital Traction.
Capital Traction shares have eaSed off
until they are now selling below par for
the first time in years. The delay IN
securing action in Congress on the pro-
posed merger has created an uneasy
feeling among holders of shares regard
ing the ultimate passage OF the meas
ure. There was small chance for action
at the short session of the last Con-
gress, or will there be much chance
OF even considering the matter at the
special session, which will convene to-
morrow, when an effort will be made
to limit the consideration to urgent
matters only.
So far the merger proposition has had
hard Shedding, passed by the House, but
was side-tracked in the Senate and
must now run the gamut of the House
again and the Senate as well.
The Capital Traction Co. has given
notice that it will renew its effort for
higher fares. nrobably If the special