The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1931-02-14
LARGE NUMBER LOST
FORTUNES But FEW
MADE EAT PROFIT.
Inflated Paper Values Were Ex-
pIoded but No Actual
Money Was Lost
CASH DISTRIBUTION LARGE
Over 81 900, 600, 900 in interest
and Dividends Paid on
Investments
Ry FREDERIC J. HAsKlN

Washington. p. c.. Feb. l4.--F--
Although 1880 stands out on the
American calendar as a year of al
most unprecedented depression. with
widespread unemployment, crop fail
ures and general distress. neverthe-
less it was the greatest year in u
history for profit-taking.
Millions of people lost money. but
money does not disappear in quick
sands or fire: 1t remains in existence
and somebody gets it. Inflated pa
per values were exploded and no &C.
tual money was lost thereby. The
losses were losses of expectations,
rather than of realities. But, in ad-
dition, hundreds of millions in real
money actually did change hands to
the loss of many and the profit OF
sclnc few.
The 1880 year of hard times was a
year Of immense profit to those who
were in the way of making a for
tune at the flood.
The stock market crash came in
October of 1929. Factories closed,
stores were forced out Of business,
capitalists committed suicide. and
thousands of persons who had been
spending their days staring at brok-
erS' quotation boards and at ticker
tape went back to work disconsolate-
ly. BY Christmas. the nation wa
In a slough of despond,
Yet in January, 1880. when the
bread lines were forming in the large
cities, the greatest distribution Of
cash in the form Of interest and divi-
6ends in the entire history of the ma
ton was made. 1t exceeded $l,000,-
O00. 900.
In September of 1929, the last
month of the long bull market and
the trade boom, cash distributions
had amounted to $3.50. 0O0, 900. From
that time onward through the year
the monthly payments Of profits did
not once fall as low as they had in
the last boom month, until the very
end of the twelvemonth. In August
of 1880, such payments dropped down
to $430, OO0. 900. but in September, the
anniversary of the end of the bull
market anu the industrial boom which
had been building on itself since re-
covery from the l920-2l depression.
they sprang back to above half a bill
lion.
Collect Rent on Money
In July of 1880. a record for that
half-year mark had been made. AL
though the country va sizzling un-
der the drought and millions were out
of work. prices falling and business
concerns going under, banks failing
and bankruptcies showing up on ev-
cry hand, approximately $3.50, 900 900
was distributed in interest and divi-
dends to the fortunate possessors of
the evidences Of indebtedness which
called for payments. The January
payments, just over a billion, and the
July payments, just under a billion.
were the largest v made. The
other months were good, too. There
were distributions of $500, 000, 900. of
$500, ooo, 900, of $7O0, oo0, 900, and $780,
OOO,0 ZOO.
The monthly average OF interest
and dividend payments in the boom
year Of 1929 was under $500, 900 900.
In the depressed year of 1880 this av-
erage mounted to above half a bill
Ion. No previous monthly average in
the financial history of the nation
has ever been so great as that shown
in the despairing year Of 1880.
It must be borne III mind that ev-
ery cent of these billions came to the
recipients not as the result OF imme-
date labor, but as profit on invest
ments, as the rent of money. The
classification dividends and inter-
est" tells the story.
This money has been backing up
ir the banks all through the year.
There is so much of it lying idle that
it has become an actual embarrass-
nlent to the banking institutions to
which it has been handed for safe
keeping. Banks pay interest to de-
rositors. Rates as high as 4 per cent
ere paid on savings accounts. What
are known as time deposits draw
large rates Of interest and some banks
allow a lower rate on open checking
accounts provided q balance is main
tanned above q fixed minimum.
All Of these deposits have become
so huge that the banks find they are
paying out more money In interest
to depositors than they r collect
Ing In interest on loans made to Gus
toners. The great Corn Exchange
Bank Of New York already has cut
IT. rate Of interest paid to depositors
and lesser banks all owe the country
are following that example.
A great deal Of money has passed
into investments, but Of q fixed-cap-
ital nature. Money Is not easy In
TIE sense that the merchant, the pro-
moter, the real estate operator. and