Evening star., 1935-10-29
ADVOCATE CHANGE
IN 1885 UTILITY ACT
Investment Bankers Favor
U. S. Regulation "Within
Proper Limits"
BY EDWARD c. STONE.

The Investment Bankers Association
In convention at White Sulphur
Springs went on record today as urging
that the public utility act of 1885 be
revised to start Federal regulation
within proper limits In this move
the association acknowledged depart
ure from its long opposition to Federal
regulation in any form. The law is
on the books and both the industry
and the banker alike must now await
the action of the courts, report said.
If the law is found unconstitutional,
the committee report added. 'it marks
not an end. but beginning. 1t may
be hoped that as result of court
decisions, or otherwise, it may be so
modified as to become the beginning
of Federal regulation within proper
legal limits"
In the meantime, the committee felt.
the passage of the act with its threat
OF forced dissolution would speed
the simplification of capital struc-
lures Which has so long been urged by
previous reports of the committee"
The report favored continuance of
utilities regulation within the province
of the Securities and Exchange Com
mission, as provided under the present
law.
The experience of the Investment
Bankers Association with the COM
mission under the securities act PROM
lsed sincere, honest and sympathetic
effort on the commissions part in an
exceedingly difficult undertaking." it
asserted.
Power Business Prospering.
After reviewing the fight over the
public utilities act the report said
that "the turmoil of the recent past
may have disturbed a proper sense of
proportion" 1t said the electric power
business of the year had prospered,
although new construction had been
blocked, and that utility securities had
advanced substantially in price, ac-
cording to an Associated Press dis
patch.
In an effort to restore "a proper
sense of proportion" the committee
declared that in order of importance
to the industry rate determination
by State commissions and courts come
first, T. " A. and governmental COM
petition which bears on rate determi-
nation, second, and the public utility
act third"
On the question of rates, the COM
nittee said:
Let it be emphasized that the basic
problem of both Government and in
dustry lies in the determination of
sound rate-making policy and the
solution is not advanced by yardstick
theories or governmental operations
which are always subject to political
considerations and which, unfortun-
ately, it must be said, are always
lacking in competence and too often
in integrity"
The Municipal Securities Commit
tee, of which D. T. Richardson of
Kelley, Richardson &, Co., Inc, Chi
cago is chairman, called attention to
the marked improvement in municipal
credit due to better tax collections,
fewer defaults and the strengthening
of troublesome situations largely by
refunding methods.
Peoples Drug Net Compared.
Peoples Drug Stores. Inc. and sub
sidiaries report that for the quarter
ended September 80 last indicated
net profit, based on comparison
OF companys reports for the six and
nine month periods, was S170234
after charges and taxes, equal to 81
cents a share on 245,324 common
shares comparing with sl72,090, or 81
cents share on 245,324 shares, in
preceding quarter and $231,5 or
s1.68 a share on 118, 1897 shares, in
September quarter of previous year.
Current assets as Of September
30, 1885, including S1,819,437 cash,
amounted to $4954 1893. and current
liabilities were $1,108,242. This COM
pares with cash of Sits, ,446, current
assets of 81, 1925 and current liza
bilities of s893,866 on September 80,
1884. Inventories amounted to S3,-
042,667. against S2,628,150.
Total assets as of September 80,
last. aggregated s7,925, 1888, comparing
with S7,843,256 on September 80, 1884,
and earned surplus was $l,825, ,483.
against S2,789,320 Capital stock con-.
sists of 20,500 shares (par S100) of
6l2 per cent cumulative convertible
preferred and 245324 no par shares
of common stock. There was no
funded debt.
Investment Trust Sales Gain.
Slauson, White & Rowe, Inc WASH
ington representatives of Independ-
ence Fund of North America, re-
ported today that sales up to october
"a we're 81 per cent ahead of the
same period in September.
The company has just announced
new type of investment known as
a living trust. which is to be handled
by the Empire Trust Co., New York.
The bank Is to do all the buying
and selling of securities in the trust.
at the suggestion Of Independence
Fund economists.
One of these economists, in charge
of the railroad division, is Marcel
Mallet-Prevost, former Washing
tonian, who has been with the Chase
National Bank for several years. He
Is member of the District Bar
and a graduate of George Washington
University. Another consulting econ
omist is DR.. Max Winkler.
Chicago Session Extended.
The presidents of % stock ex-
changes. meeting in Chicago, did not
finish discussions of the broker
dealer problem yesterday and were in
session again today. The broker
dealer issue is of much more impor-
tance here than the specialist problem
which has received so much attention
in connection with the New York
Stock Exchange. Brokers on the
Washington Exchange could not get
along without acting as dealers. also.
GNi,airr,,ara lands of the Securities