Evening star., 1931-12-28
ANNUAL AUCTIONS
OF STOCKS ARE ON
Game of Beating Tax Col.
IeCtors Reveals Tragedies
of Investors.
BY CHARLES F. SPEARE,

Special Dispatch to The Star
NEW YORK, December 28-The
year-end game of beating the Federal
income tax collectors is again being
played to the limit in the auction rooms
in metropolitan centers. Here the fiot-
sam and jetsam of the markets for all
kinds of securities go on the block and
scores of tragedies to investors are re-
vealed in the spreads between the par
values of offerings and the prices at
which they are knocked down to in
different bidders.
feature at the auction sales of
the past two weeks has been an alb
sence in the auctioneers' listings of
stocks of gold mines and oil companies
that formerly have held conspicuous
place on the books of agents for dis .
treSsed holders. This may indicate
that the market for these once popu-
lar issues has been quite thoroughly
combed and that all of the losses that
could be taken have already been reg
lstered IN income tax statments.
Real Estate Securities.
1t has been many a year since the
public lost its head over the securities
" 'A'AuIy COuCSu SOlu mining COM
panIeS and those that promised
"gushers" and princely fortunes. There
have been other outlets for the coin
OF the gullible. 1t is in the types of
securities that were issued in largest
quantities during the boom period that
the auctioneer now deals actively
The backwash of the period of great
promotion of real estate securities is
probably the most outstanding feature
of the offerings being made to estab-
llsh income tax losses. These indicate
shrinkages that have left many an in
vestor with handsomely printed certi-
t1cates for which there is little real
money value. A lot of $4,000 612 per
cent mortgage bonds of a New Jersey
seaside hotel that went into receivers
hands on Wednesday was sold the same
Gay at auction for S40O Out of the
fashionable Park avenue section of New
York City appear evidences Of former
substantial values in apartment houses
in such bids as $50 for two lots Of
certificates approXimating 100000 of a
building corporation in that section.
There are not so many echoes of the
Florida real estate and banking trou-
bles in the auction lists this year as
there were in 1929 and in 1890 APP
parently they have, like the mining
and oil stocks been written off, or
down, to nominal values by those who
have held them until the stern real
tiles of conditions finally convinced
them of their worthlessneSS. On the
other hand there has been an unusual
number of electric traction line secur-
tiles put up for auction, some repre-
senung companies that made their final
acknowledgment this year of the
greater popularity of more modern
forms of transportation.
Mortgages that covered these once
profitable lines have today only a
nominal value, bid of a few dollars
carrying off sheaf of securities whose
income in good times would have sup
ported a family. The abandonment OF
electric traction lines over the coun-
try has wiped out some billions Of
dollars of security values which a gen.
Grafton ago were held in as high esteem
as are those of the electric power and
gas companies today.
Nondescript List. .t.
There is always in these auction sales
a nondescript list of stocks and bonds
and promissory notes of corporations
and Individuals representing small
manufacturing concerns and patented
articles over which a little enthusiasm
was aroused and for whose production
small amount of capital was raised
and which then passed out of the busi-
ness picture. These again appear in
courrent auctioneerS' lists. There has
been an absence of issues developed
through that once popular channel for
diverting the money of the investor
into the bank account of the promoter
namely apple orchards in the State
of Washington, orange groves in Florida
and California, peach farms in Colo
RADIO and Georgia or 10-acre divisions
in Texas for the raising of pecan nuts.
Apparently the American public, after
one experience in this field of invest
ment, learned its lesson and has not
been tempted into it a second time.