Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-12-23

IS abundant ground
for satisfaction, DR.. H. Parker willis.
Willis points out.
Much remains to be done, he finds, and
the most important influence to business
and the stock market during coming
months will be the policy pursued by
the banks.
DR.. Willis is technical adviser to the
Glass Committee of the Senate, which
Is about to conduct investigation Of the
Federal Reserve with the idea of advis-
ing constructive changes in the law.
He is among the foremost authorities on
central banks and international finance.
having just returned from special
study of Rumanian and other European
banking conditions He was associated
with the formation Of the Reserve Sys-
tenn in the Wilson administration and
lived here several years:
His survey shows there has been a
reduction of 5000, 000,0 900 in credit
since October l, 1929, but the decline
has been chiefly the result OF less ousi-
ness activity. While brokers loans are
but $4,000, 000, 900, or about what they
were at the close of the war, the burden
Of carrying securities has been shifted
to the banks and analysis OF security
loans, contained in the survey, shows no
important curtailment of this form OF
accommodation.
Analysis Of the loan situation points
strongly to the belief that withdrawal
Of credit from the investment market
has about reached its limit, DR.. Willis
maintains. Weak holders Of securities
have been broadly eliminated, and their
holdings are in the hands Of those who
are protected by materially better COL
lateral.
Indications suggest that the banks will
pursue a policy Of moderate and con-
10 t0lkfrn nf WhQf
LIQUIDATION remains necessary, he be-
lieves, that will permit of early recovery
in the level of security prices, other
things being equal.
Commodity Prices Steadier.
The wholesale price index of the Ma
tional Fertilizer Association, consisting
Of ats quotations, computed every Mon
day, declined six fractional points dur
ing the week ended December 20. For
the preceding week a decline of more
than one full point was marked. The
index number now stands at 79.1, COM
pared with 1877 for the preceding week
and $40 for the corresponding week
year ago
Ten Of the Il groups comprising the
index declined and the remaining four
showed no change. The largest declines
were noted in the groups Of fats and
oils, other foods, and grains, feeds and
live stock. All Of these groups declined
rather sharply during the preceding
week.
More than 80 commodities declined
during the latest week, including cotton.
cotton yarns. wool, butter, cheese, milk,
sugar, pork, practically all grains, heavy
hogs, pig iron, copper, zinc, silver,
giycerin, rubber and hides. Only a
few commodities advanced. The more
important gains we're shown in cattle,
ham, crd, light hogs and cottonseed
oil.
Reserve Plans Liberal Policy.
Federal Reserve policy will make
banking funds more plentiful in early
1881 than they have been at any time
during the current business depression.
This policy should, says the Wall Street
Journal, extend the prevailing ease in
short-term interest rates in the large
financial centerS to the long-term
money market and throughout the coun-
try at large. It should have a definitely
stimulating effect on the bond market
and eventually on the mortgage mar
ket.
Instead of selling Government securi-
ties during the early months Of the year
when currency is returning to banks, the
Reserve banks probably will maintain
holdings at close to the current volume
Of nearly s700,000.0O0, and will keep
the total volume of Federal Reserve
credit outstanding In excess Of $1,000
900, 900. Thus, the volume Of reserve
credit viii be maintained at reason
ably high level, even though the demand
for such credit slackens in the normal
way after the holidays.
Such a policy viii mean that money,
which already Is easy, will become even
more so, says the Journal, and that
banks will have large volumes Of funds
seeking profitable employment. Due to
the unusually liquid position Of leading
banks, IL is unlikely that the excess
funds will be placed in either the call
or acceptance markets where yields are
less than per cent. Probably sub
stantial portion will be invested in
securities.
z. z. Mountjoy Washington repre-
sentative of the American Bankers AS
ISOLATION, received Geographic notice to-
day of the death of Elmer A. Onthank
president of the Safety Fund National
Bank Of F1tchburgh, Mass. Mr.. Ont
hank was president of the national bank
division Of the American Bankers AS
ISOLATION in 1928. He was a frequent
visitor to Washington and leaves many
friends among local bankers. In the
American Bankers Association he was
q leader and great favorate, his bank
ing ability and knowledge being very
highly rated.
Trading on ID. c. Exchange.
On the washington Stock Exchange
, today Potomac Electric Power q per
cent preferred stock sold at 11012, while
the So per cent issue moved at 107lz
Forty shares of Washington Railway
a. Electric preferred sold at 81, and l0(
shares Of Real Estate Mortgage d Guar
anty preferred at 6i2. Bond trading
was limited TO a sale in Capital Trac'
ton IS at BAY and washington Gas IS
series 3, at l06. decentralization Ma
tional Bank e. Trust Co. and East
Washington Savings Bank stocks were
added TO the ex-dividend list.
Federal Reserve Boards condition
statement Of weekly reporting member
banks In leading cities on December l.
shows substantial declines for the week
partly as a result Of the closing Of ont
bank in New York City which SHOWED
loans and investments Of about $50,
600 900 on its last report. AS compared
with a week ago, the statement shows ;
decline OF S158,000,000 in loans ant
investments, S143 900 900 in net demant
deposits and SITE, 100000 In time de
posts, and increases of 4246, 000, 900 II
Government deposits and $54 1000, 900 II
borrowings from Federal Reserve banks
Heard in Financial District.
Directors of the washington Saving
Bank are the latest to gladden. tn
hearts Of officers and employees by de
Sclaring a Christmas bonus. They hav
voted per cent disbursement base'
on yearly salaries.
More than 1000, 100000 fewer ciga
fettes were produced in November thi
year than In the like 1929 month