Evening star., 1932-05-14

Executive Council sM SN
meeting is TO the 60
American Bankers
Association. Allan NJ. Pope.
Chief among the
topics expected to be discussed at the
meeting are the Glass bill on banking,
Federal, State and municipal taxation
government financing, the Federal
budget, present aspects Of the bond
market and the work of the Institute
of International Finance, which is op-
Grated by the association IN cO-opera-
tion with New York University.
Henry Hart Of the First Detroit Com
pany, Inc, chairman Of the CON mittee
on municipal securities, will outline the
situation in the municipal market
with relation to the balancing of bud
gets by municipalities and general
market conditions in this type of
security which has virtually monopo-
lized the field Of new financing in
recent weeks.
Alden H. Little, executive vice presi-
dent of the association, summarizes the
present situation in the bond market
in the current issue of Investment
Banking, official publication Of the aSso-
citation, as follows:
Bond Market Analysed.
l. Inc uSlGu DOIlO nldIAeI now COIl-
pletely dominates what was formerly
the dominating general outside bond
market. 1t is unnatural, unprecedented
and cannot last much longer.
2. The investment bankers morale
has been and to some extent still is at
a dangerously low ebb; sales forces are
mot earning their salt, and most of us
are in the red.
3. Bonds are on panic price basis.
The sale Of 10 bonds can break many
good issues 10 points or more.
4. Conversely, and on the cOnstruc-
tive side, these very conditions present
the greatest opportunity ever known to
the investment banker. None of us viii
probably ever see one to equal it
5. Yo know the purchase of 25 bonds
or so can today advance the price of
many issues 10 points or more.
Sees Move Toward Recovery.
6. Whether We know it or not, and
whether we can prove it or not, certain
economic fundamentals started to work
toward recovery and normalcy when the
initial crash came in 1929.
7. The time seems ripe and deter
mined and reasonably simultaneous ef-
fort, hard, intelligent work, genuine
merchandising, on the part of several
hundred organizations throughout the
country will result in the sale of mil
lions Of bonds and bond prices should
advance and stay on money value
basis.
8. Then new issues on attractive
terms will gradually emerge and the
investment banker will be hack in busi-
ness again.
Short SeIling-Pro and Con.
Another book entitled Short Selling
For and Against" having bearing on
the present lively controversy in Con-
gress, has recently ccme off the presses
of D. Appleton & Co The book
presents the notable address Of Richard
Whitney, president of the New York
Stock Exchange, made at Hartford and
Syracuse, and includes his Washington
testimony in which he gave the ex-
changes views in greatest detail, de-
tending the practice under suitable re-
strictions as necessary to the mechan-
ical operation of the security markets.
The other side is presented by Will
liam B. Perkins, New York attorney,
one of the foremost critics of short
selling. So interested is he in the sub
ject that he privately issued a pamphlet
and sent it to the Judiciary Committee
of the House. the contents now being
included in the new book Many other
documents are included, together with
the text of the La Guardia bill aimed
at killing short selling for good. 1t is
unusual that one book should contain
so much information Of both sides of a
bitter controversy.
Traction Report Disappointing.
The report Of the Capital Traction
Co. showing that net earnings were off
more than s43,000 in April compared
with the like month last year, and had
decreased Sl26,363 in the first four
months OF 1882, compared with the
same months in 1881, was disappointing
to the stockholders. On account of the
low taxicab rates the slump was not
surprising.
The hundreds of local holders of
Capital Traction stock have been hoping
for an advance in quotations on merger
prospects and partly because Of the
large number of visitors expected here
during the George Washington cele-
bration.
Many of the stockholders bought
Traction when the stock was around
500 a share. They did not buy it as
a speculation, but as a sound invest
ment. That makes the present price
the more painful.
Cleaned in Financial District.
Harry F. Klmb3Q of the American
Security & Trust Co was elected to the
board of governors of Washington
Chapter American Institute of BanE-
ing, at the annual meeting. H could
not serve, however, IS the rules DO not
permit more than three representative;
from the same bank American Security
already had three
Officers and employees of the Com
mercial National Bank h2d a reception
and dance at the Montgomery Country
Club this week The guests, who were
received by President Wade H. Cooper
numbered 100 Members of the Com
mittee of Arrangements were Miss
Martha Cochs, Miss Alice Barbour, Mrs
Maude O'Toole, Daniel Radice and Fred
Mcintyre
The Citizens Equitable Building As
scciation Of Georgetown will be SO years
old next year, having bsen organized in
1888. The recent annual report showed
the organization in excellent condition
ready to round out a half century with
a mCst enyiable record.
TIE seventh successive low point was
registered by Bradstreet's weekly food
index CT wholesale prices during the
week ended May 10. II now stands al
SI67. a drop Of 06 per cent from The
previous week and "a 4 per cent from
the corresponding week last year.
Bank of England Statement.
,oa /,