Evening star., 1932-02-26

treasurer of the
Washington Lean & Trust Co., in a
forum address before graduates OF the
American Institute Of Banking, at a
meeting in the American Security d
Trust Building last evening, the Fcrurl
Committee chairman, A. q. Henze, pre-
siding. Mr.. T0vson added:
THE boom days CT the postwar
decade seem very far behind us; soon
too the mkts of distance viii soften
the harsh, unlovely picture OF our pres
ent difficulties and as they lace INTO
the perspective Of time. our fran bark
will climb again to the crest OF the wave
and the world will still go on.
"Just as the war and the succeeding
era of imitation was drunken orgy,
50 NAV our present situation be liken-
ed to the succeeding headache. What
can be said for an ephemeral, so-calieo
prosperity which leaves such disaster
in its wake? Very little; and so we
need not mourn too loudly the lack OF
a superman to bring back to us the
6reams-and the disillusion."
War Debts Given Attention.
Mr.. Towson discussed in detail the
nroblem of bank failures and presented
MANY statistics on the subject. He sug-
cested that ideas for the improvement
Of conditions in this country might be
taken from the Canadian system.
He reviewed the unlimited amount OF
inter-government war borrowing Wnich
he said has brought the world into
state where reparation and DEBT pay
ments in the aggregate consua1Qref trf.t SUI t6a
necessary flow of money ana creolV III
the channels of international trace
This strangulation of trade is more
coctIv bv far than would be downward
restatenent of these international OBJ
legations to 6 point within the capacity
of the debtors to pay, and. more I'M
nortant. within the capacity OF the
normal financing of foreign trade 10
support.
1T is an incontrovertible fact that
so much wealth wes destroyed during
the war and so much capital was
sterilized during the past war orgy OF
socialistic expenditures as to make II
unreasonable to hope for its restltuton
out of the incomes of debtor nations"
After quoting from the published
writings of several eminent economists
on the subject of gold, he said. we
must get the world back on a gold basis.
and to do it we must eliminate the IN
exorable force which is directing the
worlds gold toward the two centers
which have already all they need.
The institute members closed the eve
ming with a lively discussion OF the
s'Economic Dilemma" and the remedies.
It is such a broad subject that they
left a few matters to be settled when
they adjourned.
Much SmalI-Lot Buying Noted.
Local brokers report that there has
recently been considerable small or
what is known as odd-lot buying by
iyo hi oil ~ h11VlnO
all over the country is considered
highly important as the stock bought
outright is taken out of the market
and will eventually furnish the founda-
tion for the next bull movement.
1t is the opinion of brokers and many
bankers in the city that stocks are 60
ing to hold at least part of their re-
cent gains. If they do hold up, they
will have a favorable reaction on busi-
ness sentiment In fact, the better
bond market and the improvement in
stocks have already brought about a
more cheerful view in financial circles.
Members of the New York Stock Ex-
change claim that the market is always
ahead of business from three to nine
months. In that case, improvement in
business is believed on the way. Such
improvement will, in turn. give the
market a boost. 1t makes little diff
ference which is the cause and which
the effect. or which discounts improve
ment by the other, as long as both go
ahead.
Brokers claim that the stock market
has already discounted most of the
present unfavorable business news and
that 1t would not require much good
news to start a substantial advance.
The Reconstruction Finance Corpora
ton has already proved strong bull
factor by checking bank liquidation.
New York Cuts Bank Rate.
Local bankers were deeply interested
today in the Federal Reserve Boards
announcement that the New York Re-
serve Bank had cut the rediscount rate
from 312 to per cent. This Is held
to be the first move in a policy of
credit easing predicted as result of
Congressional action on the Glass
Steagall bill. The action gives assur-
ance that the new legislation will be
used to overcome deflationary tenden-
cies which have carried prices to such
low levels.
Federal Reserve officials are known to
have foreseen the desirability of credit
easing moves more than a month ago,
but developments abroad were an OBJ
stacle to their putting the policy into
immediate effect.
At a per cent level the discount
rate is below the yield of most Govern
ment bonds at their present prices. Thus
there is created a situation where the
banks will be encouraged to buy Gov
eminent bonds, since they can borrow
if necessary at the Reserve at rate
lower than the bond yield.
Gas Bonds Unusually Active.
Washington Gas Light 6s, Series A,
drew unusual attention on the Wash
ington Stock Exchange today. Ten
separate $1,000 sales were recorded in
this issue, all transactions being made
at par. These bonds made up the
days trading on the local board, with
the exception of small-lot sale in
Potomac Electric 5I2 per cent pre-
ferred, which came out, eX-dividend, at
10334, the same as other recent quo
tations.
Commercial Credit Dividends.
The Commercial Credit Co. of Bal
fimore declared a quarterly dividend OF
rs cents on the common stock, placing
the stock on 81 annual basis, against
Sl.60 previously. The company also
declared regular quarterly dividends OF
S1.621a on the 6l2 per cent first pre-
ferred; 4334 cents on the 2 per cent
preferred, so cents on the per cent
Class B preferred and rs cents on the
50 Glass convertible stock. All divi-
dends are payable March 81 to stock
of record March Il.
Heard In Financial District.
Local bond men were happy today
owing to the fact that yesterday wss
the eleventh consecutive day in which
the average price of bonds has ad-
eanced.
The latest review put out by F. B.
Keech a. Co., is devoted to the Glass
gEteagall bill and to conditions regard
Ting cotton, silver, cocoa, sugar, rubber,
4whest and corn.