Evening star., 1930-12-09
LONGTIME MONEY
RATES HOLD FIRM
But Interest Charges on
Short Term Notes Have
Hit Low Mark.
BY JOHN F. SINCLAIR.


Secretary Mellon has announced the
rates of l. y and rs per cent for the
new $400, 100000 United States Treas
ury certificates to be used for refund
ing operations shortly, it should be noted
that the two issues are both short-time
oneS-one for six months and the other
for twelve months.
The Secretary apparently belives
with many others, that the time to put
money out for longtime interest has not
yet arrived. Undoubtedly both these
issues of Treasury certificates will be
greatly oversubscribed, in spite of the
fact that the new interest rates, under
per cent, compare with a high of 5 IA
per cent paid by the Government in
June, 1923, and a rate of 2$s per cent
in September of this year for one-year
certificates.
Short-time money is still cheap and
plentiful-on good security. But long
time money is horse of another color.
Uses Chart as Guide.
John Pope, 80, statiStician of East
man, Dillon & Co., expert on market
figures and charts. has been rolling
in the shekelS'' the last few years by
not taking tips"
His plan Is different. He studies his
CHARTS and figures for each stock. He
gives 1t the third degree" Earnings.
assets and management are analyzed.
Then he decides whether the stock is
too high or too low in price. And he
plunges-with his charts and his cash.
In the last five years he has become
several times a millionaire. Here's the
way he works: A well known corpora
ton made financial statement to the
New York Stock Exchange, which, upon
close checking, Mr.. Pope found to be
inaccurate. He said so in a letter to
certain friends. PreSto-the Business
Conduct Committee of the Exchange
called upon him to explain.
Before the 40 governors he produced
charts and figures in a way that left
no doubt that he was the master of
the situation. The Business Week saws
that, although Mr.. Pope came out of
the conference with a greatly enhanced
reputation, he leisurely boarded a train
for Mississippi, his home State, with
out statement interview denial. con-
nrmation or comment"
But this much is known-his sta
tistical and masterful defense has been
carefully preserved in 43 copies, any
one of which may some day be very
valuable
Mr.. Pope successfully called the turn
Of the big bull market in 1929 and
also came out on top in his first serious
tilt with the Stock Exchange.
Lower Price Demands.
A. B. Gilbert of Minneapolis suggests
TO the writer that defiation always
tends to be popular before it occurs.
Previous to the break Of 1920 there
was nearly universal clamor for low
er prices, which the Democratic party
and Reserve Board yielded to, rather
than led, as commonly charged" says
Mr.. Gilbert.
"A similar wave, milder in degree,
PRQccceeod IN, fha g
You will recall that the basis for tariff
rate-making shifted suddenly, in spite
OF Democratic assurances in the cam
paign, from the full home market
basis, or differences in cost of produc-
ton basis, to the consumer protection
basis.
IF this more general responsibility
for defiation could be recognized" con-
tinues Mr.. Gilbert. "a solution would
be less difhcult and the discussion less
provocative Of claSs-hate attitudes. And
we can't hope to produce oficeholders
who will act for the good of the people
as opposed to their clamor"
Mr.. Gilbert doubts that civilization is
wise enough TO work out anything bet
ter than the gold standard, but I'VE
certainly ought TO be able to use the
gold standard more efdciently for pro-
ducers."
It's the old story-the gold stand
ard, properly handled, can be made
effective for modern society. The
gloomy forebodings, prophesied by many
economists, that the price level will
continue to drop as the amount of gold
taken from the mines diminishes Is q
bugaboo. That is. If the banking lead
ers of the world are intelligent enough
and sufficiently organized TO meet it
head on.
The danger always is that the bank
AN1@S tar,ev 4,
their own immediate problems that the
larger problems Of far greater import to
future generations are very likely to be
ignored.
Otherwise, there would be no gold
problem" today.
Rail Bonds Weak.
Railroad bonds showed q decided
weakness yesterday because many inn
portant financial groups. including
several insurance companies. have
been unloading railroads from their
portfolios in recent weeks.
The rail situation looks pretty
gloomy. The roads face fight in Con-
gress by asking to be allowed to merge
or purchase competing bus, pipe and
steamship lines.
Many railroads are not earning their
dividends; and others. in the last quar-
ter did not earn even their bond re-
Quirements.
z. E. Loomis, president Of the Jehigh
Railroad, does not believe that the So
luton TO the problem hes in increasing
railroad rates, but rather in the direc-
ton of getting the railroads to make
rate adjustments to compete with
other forms of transportation. Mr..
Loomis says:
THE severe loss in revenue producing
trafic as a result of the operation OF
N1I1 T~aA Nl
ment-subsidized waterways, the increas-
ing use of unregulated trucks and buses
on public highways, the building of new
pipe lines for carrying oil and gasoline
and the high tension power lines pro-
ducing the Nations coal requirements
have brought home to many business
men the grave difnculties In the situa-
ton
All true, but still the railroads them
selves have not been up on their toes or
as aggressive in meeting the new COM
petition as they should have been. SO
n crisis looms in the rail situation. And
that largely accounts for the selling OF
railroad bonds at this time.
Sugar Price Agreement.
The quick response Of European sugar
prices to the agreement which the
Cuban-American group Of sugar pro-
ducers, led by Thomas L. Chadbourne,
New York lawyer, reached with the rep
resentatives Of the Dutch East Indies
sugar producers at Amsterdam yesterday
was followed by advances Of from three
to i've points in the sugar market on the
New York Coffee and Sugar Exchange
yesterday.
Yesterdays delivery sold at 1.34 cents
o pound, while March option moved up
20 l.A6 cents q pound.
The Dutch growers in Java, next TO
Cuba, are the largest cane sugar pro-
ducers in the world So Cuba and