Evening star., 1934-07-17
DROP IN-TRANS|T
EARNINGS SMALL
Capital Company Makes
Good Showing C<spite
Seasonal Lag.

While showing seasonal decline
IN business during June as compared
with May, Capital Transit Co. made
very good showing during June, &C
cording to reliable indications today
In the financial district
Detailed figures will be made public
next week, when the company pre-
sents its June report to the Public
Utilities Commission.
Records of the old Capital Traction
Co. and the Washington Railway 8,
Electric Co. show a substantial fall
ing-off of business over the last sew
eral years, during the hot Summer
months, usually beginning in June,
and progressing through July and
August. 1t had been thought that
the Capital Transit merger probably
would be subjected to a comparative
drop. These fears have been real
lied only in part, according to best
information from those who are close
to the situation. The seasonal de-
crease, under the merger, IN other
words, is expected to show a smaller
drop than the average drop during
the Summer for the two old rail COM
panies.
This will be good word for the
holders of 240000 shares of stock in
the merger, who are watching closely
all developments in the operation Of
the new company.
The number of passengers has been
on a steady gain so far this year, but
is known to be taking seasonal drop
now less than had been anticipated.
Weekly Pass Is Success.
The weekly pass has been a decided
success in stimulating travel. Sales
of this pass have fallen of somewhat
along with the seasonal decline in
passengers, with the disappearance of
Congress, the adjournment of school
and the advent of the vacation sea-
son, but sales are understood to be
holding up well.
Improvement in service, and pur-
chase of new rolling stock already
has caused considerable expenditure
of funds accumulated against depre-
citation, but 1t is understood the
merger still has on hand substantial
accounts to 60 forward with other
improvements now under considera-
ton.
Considerable interest was evinced in
financial circles here today in ap-
pointment yesterday of Judge John J.
Burns of Boston to be general counsel
of the new Securities and Exchange
Commission. Burns is not well known
in Capital circles. He is said to be one
of the youngest judges in the country,
81 years Of age, on the Superior Court
bench at Boston. Baldwin B. Bane
of the Federal Trade Commission be-
comes administrative officer for the
new commission. william o. Douglas
Of Yale will take charge of what the
conission will term reorganization. +"
United States Borrowings Cited.
"The Federal Government has be-
come our greatest borrower, our great
est lender ana our biggest business, Z"
writes Col. Leonard P. Ayres, vice pres
ident of the Cleveland Trust Co.
1T is the best customer of our
banking system, but it is disquieting
to note that as its activities in the
banks increase those of the other GUS
toners tend to diminish. The evi-
dence that this is happening is pro-
vided by the reports showing condi-
tions in banks that are members of the
Federal Reserve System. They show
that since the beginning of the depres-
sion the volume of Federal securities
held by reporting member banks has
much more than doubled, while in the
same period the business loans have
been nearly cut in two
This change means that borrow
ings from the banks by the Govern
ment are rapidly increasing and that
the use of bank credit by business is
declining. The process is continuing
and apparently gaining momentum.
The changes are almost directly COM
Elementary to each other, for from the
Autumn of 1929 to the Summer of 1884
Government borrowings from these
banks have increased by just over S4,-
600 900, 900, while in that same period
the borrowings by business from the
same institutions have decreased by
almost $4,000, 100000.