The Waterbury Democrat., 1936-01-17

ceedingly wroth
 because the
 government has
 cut In on the ~, w,..w~ ..,.n money lending
 end of its business. Last satur. day night in 6 speech delivered in Baltimore Jesse Jones, the boss Of the Reconstruction Finance Cor poration, gave an Illuminating in. stance of what the flnanciers con- slider unfair competition. MT. Jones is, or was Q banker himself, and presumably knows his nickels. Horrible!
 The Great Northern Railway has an issue of bonds outstanding to the insignificant amount of some hundred and ten millions dollars and wanted to do c little refinancing preliminary to the date of payment. Big Banking was agreeable and, figuring on no opposition, proceeded to lay down the conditions for the operation. The bonds were to be five percent- CTS; the underwriters were to be paid one million dollars for foun- tain pen ink; and there was to be an additional one per cent on every bond the bankers bought for themselves. Since 1t would cost the railroad about ten million dollars and In view of the fact that the company has an un- broken record for meeting It's bonded obligations, the rate ape peared extort!onate, the under writing fec unnecessary, and the additional one per cent looked Q triile too 6hylockian. So the REC. moved into the picture and tried to reagon with the bankers. The contention of the government lending agency was that consider ing tho railroads financial sound- ness four and one.half per cent bonds would be Q safer investment for the buyers than Ave and 50 MT. Jones offered to take half the issue on terms which were in line with the Roosevelt administra- tion's determined policy to cut in- terest rates. Figuring that the deal was ''all buttoned up," as tho chairman of the REQ. expressed 1t, the money lenders gave MT. Jones the Bronx huz2a, and stood pat on their demands. The up. shot is that the bankers have been eased out altogether, the refund- ing will take place at four per cent and the REC. will buy any of the bonds which are not picked up by investors. Already the quo- tation on the securities Is one hun. dred and three and half when, as, and if issued" the Reconstruc- ton Finance Corporation will not have to spend Q dime, and every- one is happy except the money lenders who overplayed their hand. Hence the feverish desire of tho world of high finance to get the government out of the lend- ing business so that interest gyps may be boosted to 0 new high. Hence the heat turned on full blast against the President from the financial propaganda furnaces. In 6 way no one should blame the big bankers. It is no pleasant sen. sation to have the chisel knocked out of your paw just as 1t Is about to hack Q juicy niorsel out of the helpless carcass of . harried bor- roWeg.
 The Laugh
 The laGEn emerging from the atrocious activities of the REQ. in destroying golden business op- portunities for Big Banking, such as the Great Northern Railway deal, is that former President
 Hoover is responsible for the ex- istence of the damned Reconstrucs ton Finance Corporation. It was an inspired Idea. The trouble was that MT. Hoover did not know what to do with it or the field In which to apply t after he matched 1t. Confinlng It's application to helping out monster financial in. stitutions like Charlie Dawes and letting the small banks % to pot unthought of, was not only an or. TOT but Q tragedy for the small banks, for their depositors. and for MT. lIoover. I have no doubt that theFa are many bankers who regard the REC. as . godsend, who have nothing but praise for the way 1t has been administered, and who appreciate that it was . lifeline thrown to them by MT. Roosevelt when they were dTown' Ing, They will shed no tears over the waiiop handed their colossal brothers in the Great Northern grab.
 More Wrath
 Almost as much as # not more than MT. Roosevelt, Postmaster General Farley hes been the rous- Ing red rag Of the Anti-adi1linis. tratiCn bulls. Whenever they get