Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-09-18
Everybody's
Business
Controller Ruling Enables
Banks TO Repa1ue Bond
HOld;ngs. but Public IF
feet Doubted.
By DIR. MAX wINKLER.


Special Dispatch to The Star.
NEW YORK, September 1s.-The ruiz
ing by the controller of the currency
will make It possible for national banks
10 reyalue their bond holdings on the
basis OF inherent soundneSs rather than
market quotations.
Apparently. quotations have ceased
to bear any dependable relation to the
merits or dement's of the issues involved,
due primarily to the fact that every one,
or pretty nearly every one, Is possessed
with the desire to sell. irrespective OF
price. just as in the days Of the boom
two years ago, every enc, or pretty
nearly every one, was possessed with
the desire 70 buy.
While banks may be able to increase
their assets value materially, 1t remains
TO be seen whether the confidence Of the
public viii be restored to any apprecia-
bic extent by such measures. After all,
most OF the country'S banks are funda-
mentally sound, but 1t Is apparent that
no institution, however sound tt may
be, can Withstand 100 per cent run.
Too Many Bank Failures.
While many business men heartily
indorse MIR. Poles ruling, they feel that
much more could be ocne to restore
confidence, If the Federal Reserve were
10 modify its rather rigorous rediscount
policy and put halt to the continuance
of bank failures throughout the coun-
try.
AS long as confidence remains shaken,
banks will be obliged 70 maintain the
maximum of liquidity. In order to
achieve this. they viii ma it necessary
to sell continuously whatever can be
disposed CT, and whatever has no ready
market viii be sold at a great sacrifice
and to the distinct detriment Of the de-
positor, the stockholders and the COM
munity.
Professionals, who have been attempt
ing to depress tobacco shares in general,
and American Tobacco in particular,
advanced as the chief reason for their
policy the fact that tobacco stocks have
been going up steadily for number of
years. They also remind us that Ameri-
can Tobacco, in point Of price, compares
less favorably' with quotations in 1929
than the majority of stocks listed on the
New York Stock Exchange.
Such is the rather naive reasoning of
those who work destructiveiy. They do
not apparently consider that sales Of the
leading brands of American tobacco
have risen appreciably within recent
weeks; that the sale of one brand OF
tobacco has advanced almost l40 per cent
in relatively short period of time, and
that It's British subsidiary has succeeded
third place in the English business.
Bethlehem Steel Outlook.
With operations ct not mere than
about 80 per cent Of capacity, with gen.
erai business conditions sill unsatisfac-
tory, with cash holdings having suffered
somewhat from court litigation and an
srnbitio"- expansion program, the out
lock for the continuance Of the divi-
dend on the common snares Of Bethle-
hem Steel Is not especially bright.
To be sure, no action need be taken
for another four weeks, and it is not i'm
p1ssible that turn for the better may
IN the meantime occur in the steel bust
ness. During the first half of 1881 the
company has barely earned its preferred
dividend requirements, and 1t is doubt
full whether the third quarter will add
much TO the profits reported so far this
year.
Economic planning will contribute to
D more stable prosperity. in the opinion
of Owen D: Young. A plan written on
paper Is Of no service, continues Mr.
Young, adding that program, to be
productive Of quick results, must be
executed promptly, and that no one
concern can make 1t effective.
IT is obvious that without systematic
planning, conditions are destined tc
continue chaotic. The only difnculty
seems 70 be that too many plans are be.
ing proposed TO redeem mankind and
that most of them merely afford SUITE
bic material for debating societies and
professional lecturers. 1t IL therefore
encouraging to learn of plan by Mr.
Youngs associate, Gerard Swope, preSi-
dent Of the General Electric Co., which
would seem to deserve most serious con-
sideFat.on.
Mr.. Swope's plan embraces regularity
and continuity Of employment. leader
ship by organized Industry; standard
hzed forms Of rerorts 70 stockholders