Evening star., 1932-12-01
INTEREST TURNING
TO DOMESTIC NEWS
Debts Still Have Influence,
but Uncertainties in
U. S. Stressed.
Special Dispatch to- The star.

Special Dispatch to The Star.
NEW YORK, December 1.-THE stock
market Is turning its attention more to
home affairs, after its recent absorption
in the war debt problem.
Intense interest is taken in the for
eign situation and any decisive develop
ment in that quarter would certainly
be reflected in stocks, but that is not
the only question that Is troubling the
Street. In fact, opinion is veering to
the idea that from long-range stand
point it does not make SO much differ
ence whether or not debt payments are
met on December is. II they are paid
this time 1t only postpones settlement,
and If they are not paid it will be a
blow to British credit, which is sure to
react disastrously on financial relations
the world over.
The only permanent solution would
be an agreement to which the Ameri-
can Congress, the British Parliament
and the French Chamber Of Deputies
could subscribe, and that is obviously
impossible of attainment now and ap-
parently for long time to come.
Among domestic uncertainties, the
dividend outlook is a heavy drag on
the market. The situation with regard
to United States Steel preferred has al
ready been discussed in this column.
incidentally, Steel preferred was acutely
weak Wednesday on unfavorable reports
from the trade The General Motors
disbursement is questioned, and so are
host of others.
Surplus Gone Eventually.
No matter how strong corporation
Is financially, it cannot go. on paying
dividends out of surplus indefinitely.
Sooner or later there comes day OF
reckoning. Even corporations which
have maintained net earnings at q
comparatively satisfactory level all
through the depression are now feeling
the pinch of decreased purchasing
power. It affects the tobacco COM
panies, long supposed to be depression
proof, but which are now feeling price
competition.
Ninety-seyen per cent of the stock
of the Chicago, Burlington g. Quincy
Is owned in equal part by Northern
Pacific and Great Northern. The Bur Bur.
lington has had long and honorable
dividend record It has paid some
thing in every year, except three, since
1856. and since 1861 there has never
been a year in which the shareholders
went without some return on their In
vestment. In 1881 $40 was paid. On
June 2, last, semi-annual dividend
of So was declared, which. II continued,
would be Sc annual rate.
Burlington directors were scheduled
to meet for dividend action Wednesday,
but 1t was announced that considera-
ton has been postponed to a later date.
The news had an unfavorable effect on
the market In its reminder Of the evil
times which have fallen upon even the
strongest of American railroads. Incl
dentally. the current estimates are the
Burlington will earn this year about 81
asshare.
OF the larger carriers, the Chesapeake
q Ohio is making the best showing by
wide margin. 1t is the only large sys-
TEN that has not cut Its dividend, which
il is earning, with something to spare.
Returns OF car loadings. for November
a1e not yet available, but 1t Is estimated
they will show an increase Of to per
cent over November, 1881, which Is an
achievement.
Wheat Being Held Back.
One carlaad of wheat moved out of
Omaha and rs cars out of st. Louis and
Kansas City on Tuesday, total Of "A
cars On the same day in 1881, from
these cities, 227 cars were sent out.
With the farm price of wheat what it
\ Is and with freight rates what they are,
fhe holding back Of wheat from the
Aarket Is not surprising, but 1t is some
hing to be taken into account when
ppraising current railway earnings.
Eventually, Of course, this wheat will
have to be moved, but meanwhile it
looks as IL there were something of
strike on the part of the producers.
Reports sitting into Wall Street from
the Middle West emphasize the gravity
Of the farm mortgage situation. They
lend point to the plea of congressman
that they cannot countenance lienency
to our foreign debtors when their own
constituents are so heavily burdened.
Neither the congressman nor the farm
erE connect the decline in the price Of
farm products with the unsettlement in
world trade. which, In turn, Is the re-
suit Of these international debts. The
legislators argue that II Europe is let
of from its engagements they will have
no reason to give why there should not
be mortoriuin on agricultural debts.
It is not an easy question to answer.
Aside from the obligations Of the
United States Government, the only Sc
curities which command ready mar
ket are the first mortgage bonds Of
operating public utility corporations Of
unquestioned financial strength For
these the demand Is greater than the
supply. One of the best known bond
men in the Street said today that he
expected to see securities Of this grade
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