Newspaper Page Text
8D
News and Views by Experts of Finance, Industry, Crops and Commerce
STOCKS MAY HOLO OP,
BUT NO BOOM IS TO BE
DESIREO, FORBES SAYS
Reading Stockholders Likely to Pare Well, but
New York Central, Now Haven, Rock Island
and Copper Shares i\re To Be Avoided. De
clares Expert Observer.
By B. C. FORBES.
NEW YORK, Sept. 20.—1 t may be that stock markets will
not go backward. But a boom is neither desirable nor profitable.
The moment the public begins to clamor for securities, underwriters
gladly will bring forward long-delayed issues
And 1 am told that two or three huge blocks
Eyof stock in other roads carried In important
railroads will be turned into cash whenever nt
tractive opportunity offers. Baltimore ami
Ohio, Southern Pacific and New Huven an
2 On the other hand, I hear that Reading stock
1 R holders will fare sumptuously m the near fu
ture. “Concealed assets - ' are not now kindli
regarded by the government, hence, a distribu
j tion would be in order.
’<7 Too much has hern made of the prospective
Union Pacific “melon. ’’ Any huge gift to
■*“ *** J stockholders would leave the company less able
to maintain its dividend, for a hen lays no extra eggs after being
killed. AlO per cent Reading and an S per cent Union Pacific ma.t
be 1914 tidings. 1
Some Dangerous Stocks.
Dangerous railroad stocks in-1
elude New York Central, New
Haven, Rock Island and Chesa
peake and Ohio
Industrial issue* rreatly Hff#*ctefl by
tariff reductions should hr avoided by
investors, although speculators may 1
»-ari. profit* ■ ■ * ettag sto< fa whlch
have ha I seven declines.
Despite the prlre-rttting- in steel
products in Germany and here, re
flecting the halt in business expan
sion, influential Interests In the
United States Steel Cori»oration are I
talking optimistically about the com- i
mon shares. J have heard whispers 1
that the corporation has a feu sur
prises in store for certain Washing
ton gentlemen who were so eager fori
a prosecution The politicians having
had their innings, the company, so the
story runs, intends to have Its turn.
Copper Is a Gamble.
The copper boom continues. It may
go much further before the Inevitable i
erasb CORM * sh.t rvs ar<
illations, it may he well to remind
small investors who do not want to
take risks.
Anu rica probably will import gold
from Europe.
The principal central banks abroad
are well supplied with the metal, and
quieter trade will ease the pressure
fui funds Hut th< impending quar
terly settlements entail very heavy
• i.,!.- md f • Ipments of
gold nwy be delayed until next month.
Much n<»n>ens. is talked and writ
ten about our ‘ command of European
gold.” \V<* do not command European I
gold Europe does not owe us money.
We are in Europe’s debt to the ex
• rit of several billion dollars. Don’t
Forget that fact
In Debt to Europe.
Also we are getting deeper Into Eu
rope’s debt ever\ year.
Publication of our August foreign ;
trade returns, showing export bal
ances of $50,000,000 for the month and
1360,000,000 for eight months, has en
couraged the boastful asset tions about
cur ability to force gold from Euro
peans.
Against tills surplus of merchan
dise over purchases there must
be set what are called “invisible
charges against us, running toward a
billion dollars annually
The volume of gold imports this
autumn is not likely to be abnormally
Financiers are disposed to accept |
coming changes with good grace, i
While talking cheerfully, they are act- |
ing cautiously.
Everything I* Changed.
Said one very influential autheritx ;
“Even were th* new tariff law all |
right, still it IS a new tariff law. It ,
means a change.
“The new currency system may b<* •
a good thing, but it means a change !
“The crop prospects were very fine !
•t one time, but now there has been
a change
“President Wilson has kept the
Democrats in line remarkablj well.
But, in looking ahead, don't forget
that Senators now are influenced by
the popular election innovation. This,
too, is probably all right—l believe it
Will prove a good thing—but it will |
mean, to say the least, less conserva i
tlsm. Here, also, you see. we are i
confronted with a change.”
Next month will have to bear the 1
disturbances incidental tn ushering in i
new tariff s hedules. An enormous i
mass of goods will be freed imine- I
diately from bond and will give an
appearance of activity to trade.
Railroad receipts, which keep up
wonderfully, v ill be temporarily In
flated and general sentiment may sud- j
denly become exuberant. but it is not i
likely to last. The best that <an be
expected during the remainder of 1913 1
re-adjustment to new conditions in •
preparation for a broad forward (
movement next year.
SPO T COTTON MARKET
Atlanta, steady: middling 12%ni3c.
Athens, steady, middling 12%.
Ma-<>n. steady: middling 12c
New Orleans, firm; middling 13 5-16
Nt-w York, quiet middling l* 10.
Philadelphia, quiet; middling 13 85
K■■■-»••!.. uiiiet: middling 13.60
be. *-ot easier: middling 757 d
bavunnah. steady; middling 13%.
Augusta, steady: middling. 13%
Ch ark ston. steady: middling •_%
Norfolk, steady . middling 13%
Galveston. firn., middling 13! 16
M<bii* steady, -uddling J 3%
Moh.ir steady, middlirg 12%
Wilmu gtem, qu.u middling 12%
Little R< “'k stead >, middling 12
Bab niivre, nom.nal: middling 13 »
St Ix>u4«. steady; middling 12%.
M-.inphi 4 ’. stead>; middling 13’.
Houston, steady, middling 13V.
Louisville firin middling 12%
Charlotte, steady, middling 13a
Greenville, atewJj, uuaUlmg 12c.
Cotton Prices Firm,
News Favors Bulls
Rumors of Gulf Storm and of Texas
Exporters’ Troubles Serve to
Sustain Market.
By EDW. LOW RANLETT.
NEW YORK, tkpt 20 The cotton
•market show* <i derided steadiness to
day, opening 2 to h points higher than,
the previous c!os« Th« re was some
slight recession on profit-taking, but ru
| mors of n Gulf storm and trouble
among Texas exporters in getting cotton
■ fast enough sustained prices. The
weather nap Is pra<tle;ill\ free front
j heavy rain Loth East and \\ •• t and the
I forecast calls for clear weather for tin-
I western belt, with only light showers
for tnottou and Mctnd.iv eastward
t These t oi.ditions should enable fanners
! t" pick and market the crop
Spinners’ takings f<»r the week were
greater than last year This is of Im
portance, particularly as the crop doe 4
■ not promise to equn' last year's. Th*-
I world s stocks, according to tho Finan
rial Chronicle. now are about £50,009
bales less for American cotton than fo’’
the carve a ponding period last year
speculation has be en conservative and
It was only during the latter part of
the week that spumers appeared to
have i a ken hold of the situation lairg**
sales have taken place in Liverpool,
running at times from 14.000 to 15,00 •
bales a day The fart that the ad
vance from prices ruling about fifteen
days ago has been near y >5 a »>«!■■
does not appear to deter them
Estimated cotton ree-lpts
. Monday 1012.
New Orleans l.roo to 1.600 2,!'o<
<Jalv< ston .. .23.000 to 25.000 33.582
RANGE IN NEW YORK FUTURES
7J [WJf I n
So, l,< 4F, l:< i?, 15 13 If, If, |f t '3i.3;
Os, 13.38 13.47,K1 3413.311 O3K ton:!3-3‘.
13 32-34 13.30-32
tie. 13 30 13 l.> 1.3 30 339 |2 38-10 13 2S-27
•la. 1.3 20 13.36 1.3.10 13.20 13 .’8 L">1314-I'.
I's 13 24 I.", 24 13 f | 13.24 r; 30-32 13 It', 18
Mr 'll fit 13 4'- I 3.20 U 3!l 13 .38 40 13 23-24
Ms 13 34 12 15 13 311 12 44 13 4:1 44 1.1 28-211
• )n 13 3‘t 13 31t 4113 24 I",
I> 13 33 13 10113 33 13 28 13 38 40 13 23-2'.
Closed vers steads
NEW ORLEANS COTTON.
NEW OKI.EANS. Sept 20 PtiVH!-
rtll'l. s 11-. 11l I. v. ■ 1.,.,.! I. .
liik advance their «:<- raus".J b> "las
ing down” on the part »»t several < >.t
ton firms in Texas Th< sensational
rise in spot val'iox at inti rl.ir ami i .ot
markets. pnrttcularls at Oalvnston.
inhere middling to-dos wo- .|tiot ( .t ,t
ISOICe. gave evident -of th,- s. lainttlr
among spot buyers to get p...-.session of
.desirable grades ot tltr actual artleh
The stiff advance In fl. local con
(tract market to-das was based . n tlie
t strength of the actual urttelu
The market, once started up. dltl not
I stop until .lariiaty contracts ... within
< 1 point o! !3bjC. A recession of 8
I points followed. but th- ntarkt t
j strengthened again at the cl. «. when
the local spot market was . IT,. ..Hr
ported firm and ’nc higher on all grades
NEW ORLEANS COTTON.
' EHHI i H
|Be 13 30 13 18
its 13.24 13 38 12 24 13.34 Ti 34
1 N'O *?3 24 37 1 3 2'...
I ! >c. 13 3'1346 13 2!t IS 40 13 ml 3 2f 27
~ta 13 35 13 4'.' 13 34 13 44’13 43-44 IS
' Eh. . . 13 43-47. 13.23-31
,Mr 13 46 13 60 13.40 13 7.1 13.54-r'. 13 33 40
,M> 13.54 13 61 '3J.:i Kjddj’bl 63 1.1 .I'-4'l
I Closed steady.
LIVERPOOL COTTON MARKET.
Opening ’’rev
Range Cloj-e Close.
•Sept. 7.36-7.3&L. 737 U.
I Sept.-Oct. .. .7 22-7 27 7.2’.v a 7 17L a
I Oct.-Nov. .. ..7 13-7.18 7 1O».
Nov -I>ec. 7.07 7 10 77 00G
! Dec-Jan 7.05-7.10 708 U 700 G
‘Jan.-Feb. . .7 06-7.05 7OS u 7 00’
Feb Meh. . 7 07-7 •> 7 '»7’ s 7.00 L.
; Meh -Apr . 7 06-7 10 7 <»k’- 701
Apr-May 7 07 7 07uj 7.01
May-June 7 06-7 08*4 7 10 701
June July .. . 7.04-7 07*4 7 06*, 6 !•»*,
July-Aug 6 86*4
Closed steady
COTTO NSEED OIL
NEW YORK, Sep: 20 The war
months in the eott<»n se»d oil market
were easier under • tember liquida
tfun while later months wen* tinner on
scattered buying. inspired by the
strength in cotton an«l lighter crude
offerings*
■ Opening
Str.r-mber . . 720 760 7 15'»i7.60
.Spot 7.15
<>< u l»er . . . 718•. ’2O 7.1 4Af7 2“
. November .... 6 -s •: 7 0 6 00
mber ... 687 • • ■ . .n . ■ .q
i ’anuary . . . 7 (H’u 704 7 A2'<. 7.03
I February ... 7 0 •71 1.0xz7.1 ; »
‘March . . 7_'Cw7 2‘> 7 20& 723
’■ - •
Clubcu alvad. . aalea 7,yov barrels.
HEARST’S SIXDAY .UIfaKILAA, AllrA.NlA, GA., SLADAX, SEI'IEMBEK 21, 1913.
Stocks Sag Because '
Os Holiday Dullness
Market to Have Short Session Mon
day—New Haven Victim
of Bad News.
NEW YORK, S* pt 20 Prices we re
irregular and heavy m the dull wtock i
market of to-day. chiefly because of the
short s*—- <>n. which will L* followed by
another shori session on Monday, and ■
the fact that the Umdon st<e-k Ex- ■
change was cb»sed fur a holiday 'I he I
opening was dull and h*-avy owing to a I
lark of stimulation in overnight devel
opments lis ion Pacific opened a shade !
b.gher, hut fell off within the first hour, j
S- u’hern I'a* ific, Northern I’ai ific,
lb .thing and Fteel ruled heavy and ir-I
regular during the trading
Dispatches from Europe indicated a 1
poss.bi ity of Nryj York obtaining a
port loti i f the |6,53...000 fresh gold sup
ply arriving there this week This is J
.ulikrly unless exchange rates decrease,'
somewhat from th«- present 4.851-0 for ’
demand bills and 4,85’4 for cable trans
fers
New Haven July earning.? s»h<»wed a
gross increase <f $25,000, uhi<-u was
i• ■ ■ t net d<flt It -1483,000
The Street heard an anti-trust suit
against the roud is likely
There was little <>r no tendency of
tr.i« *t> t<» increase their holdings The
only feat mo which developed towaro
th» close was an unexpected r-se of
plants in Canadian Pacific and the re- i
t.t wfd weakness in Kock Island
Stork quotations and net change:
(’ins Net
STECKS High Bid Ch’ge
Arnal ( upper 77:* 77% % '
Am. Agrii-ui 47
Am B<et Fug 27% 27% 27% .
American Cun 34 ft „ 34\ M
do. i ref 06%
Am Car Fdy . 47 47 47
Am. <’ot < >ll ... 42\ ....
A met lean I<*e. . . 23 ....
' Lot mo . ...
Am. Smelting.. C7 r U HD-i 67 7 m %
Am. Sur Ref iij 14 ;
Am. T T 131’» -t- ’-i ;
Ain. Woolen . . !!•
Anaconda . . . 38U 38>A
Atchison JG-% 95 ! h
A •' L 122L 4 122*4 I.’’- «4 1
B and <> 96 96 J-P*
Beth Steel 36Vs *4. ’
B K T 89fc
Can Pacific.. 232 230% .31 ....
C*-n. leather. ... 23 .... J
C and o 59% 59
Colo. F ana I 33% - %
Colo Southern 27% %
Consol <;«s 132%
Corn Pro«luctH 11% ... I
D and H 160 ....
J *en ami H. G . 20
Distil. Secur 15% 15% |6 %
Erie . 29 29% 2m % %
do, prpf , . 47 —% 1
Ger. Electric 117
<5 North pfd 128% 128% 128 U * k
G North Ore. 39% 39% 39% -e %
G. Western 13%
Jll Central. ... .110 ....
Interhoro ... 15% 15% 15% j
do. pref. 61 64)% 60% ....
Int. Harv. (old) .... 108% ....
lowa Central. .. 7
K C S. . . 25% 25% 25% —% ;
M . K and *’ 22 22 21% %
(10, |>rvf ... . ... 56 ....
L. \ a Iley. . 158 ! „ 1 .»8 % I»8 % | %
E and N . . ... 135% ...
Mo. Pacific . 29% 29 29% 1 %
N Y. Central 95% • 95% •».'.. ..
Northwest. . 130% %
Nat L«a<l 47% ....
N arid W <>♦; ' %
No. Pacific . . 113% 113% HI
< > aii-l \\ jji %
Penna. . 112% 112% 112% .
Pacific Mall 2*2
I* Gas Co.. . 121 124 121% Y
P. Steel Car . .. 27% .....
Reading . 169 168% 118 %
R. I. and Steel . . 23\ . ...
do, pi t f 88 ...
Rock Island 14% 14% Ip% %
do. pref . 23 22% 23% %
S. 35
So. Pacific 93 92% 93 %
So. Railway 24%
dv. pref 80 . ...
St Paul 108 r %
Tenn. Copper .33% %
Texas Paclflc. 15 15 15
Third Y venue. . ./. 40% %
I riion
I’ S Rubber 88%
I’. S Steel 61% 6-1 bl % .
do. pref 10!'% 109% 10M %
I’tah Copper 55% 54% 55 %
V -C. Chem. 30% 30% 30% %
Wabash 4%
do. pref 12
W Fnion 40% ■
W Maryland 40% . . . .
W Electric .’O% _ %
W. Central. 48 ..... ■
'l’<ital sales. 100 000 share’s
COFFEE.
NEW YORK. Sept. 2- The coffee
market whs strong to-day. prices at
one tune advancing 18 to 24. making
m-w high ground for the movement on
continued strength in Havre and un
favorable Santos <rop mivires.
There w<-re rumors th.it Brazil 1
was supporting September contracts In
Havre ami the . . st ami freight marke*
was 10 to 2’> poitas higher. There was!
lu.tw irui’ ing it the advance her* and
prices eas«t| <.|T several points, partlcu- J
l.trlx on later months. Some house -1
with Kumpe;!a connections were heav\
sellers
The spot nuirkt t was stea<iy and %!
cent highei on the basis of 9% cents
for Rio 7’s •]
opining Closing. !
January 9.26 9 28'0 !> 29 ,
March .... 9 19 J1.51fq9.52 >
May *• .65 9.63'a9 65 !
June 965 9.t0 fit !■ 7 i *
July .... 975 9 7t)<B9 78
August. . 9 73'0!».75 9.76(a9.78 i
September. 9 1
October. . 8 90 S 98'0X1*0
November. . 895 9.07«t9 10 1
December. 9.10
Closed firm. Sales, 56,000 bags. ,
RICE.
NEW ORLEANS. Sept. 20 The mar
k< t for clean rice continues to rule
active on Honduras anti steady on
Japan
Quotations on the leading grades fol-
• u
Honduras. Japan.
II ead 4 % t> •3%(p 3% I
Straight 2 % tu 3 % 2 \ <•! 3
Screenings ....I\u2
PORT RECEIPTS.
Tiie following table shew* receipts at
the ports to-day compared with the i
' . < ■. last year
1913 1/ 'J
New Orleans ...
G.’Uvvston 17.734 23.117
Mobile ’ 3.M5 t 1.687
Savannah 12.833 ' 9.4'27 1
Charleston .... 3.958 I 2.803
\\ ilmington . . . 3,163 2,800 1
Norfolk ' 749 1.602
Boston 1 '
Various 400 3.940
Tend. . . - .■ 45.458 47.515
INTERIOR MOVEMG
' ~IM3 ~T 19U 1
Houston 22 222 36 988
Augusta 2.292 1 2.978 '
Memphis. 397 ly i
..... 18« 8”
Cincinnati ! 91 { 92
• • ' 430
Tirar 23.158 40.582
SUGAR.
NEW Y< »RK Sept 20. \ll grades of
r remained unchanged to-day The
l uicpi »n beet sugar market to-i’ay was
firmer Svpteu.l < r beet.** were unchanged
• ;. • .i.-i May beet
atlvar.i vd •< 1 to 9s 4%d and 9> B%<l
respectively
BONDS
NEW YORK. s--pi 20 Government ‘
’ un< ha.-.g”. Kailr-iud bunds ir-;
■SIIUHG
I OPE MOTION;
PRICES FIRM
Bolls Rotting and Sprouting.
Staple Being Beaten Out, Say
Reports at Spot Market.
MEMPHIS, Sept. 20.—One extreme
has followed another. Long drouth
ha? been succeeded by excessive rains
The cotton market, in consequence,
has shown unusual strength.
Rejoicing when the drouth was
broken turned to dismay when r :i*
rains showed no let-up. Very soon it
wag realized that damage, not im
provement, would result from |he
downpour The combination of drouth
j followed by heavy rains uas particu
-1 larly disastrous. The drouth forc' d
1 the cotton • pen prematurely, and wit :
h large percentage o* the bolls in the
fields open to the rain, damage :o
1 grade of the staple wis inevitable.
The outcome, so far as the producer
Is concerned, amounts to the same
thing In out h threatened to cut
short the yield. Th*- rains offset this
to some extent, but cheapened *h
cotton already developed.. The rains 1
will not rcduc. the number of bales
marcr’any The famous storrn year,
; 1906, proved this conclusively.
Complaints have poureil in from the
sections tha: have been so heavhy
|dren< hed. The market has regpon-1-'
1 *-d r< adi’y and has ati.nulatfd bullish*
activity to a rir-gre that conservative
people fear is .. bit dangerous. It wJi
| take several days after the wet sp» "
i passes before the real situation < in
' i»e ascertain’ d. Complaints have com
here of bolls rotting and sprouting,
as well as of open cotton being beat
en out. In those- sections
(growth had not b« en practica’%'
stopped by the drouth there will be
-an added growth that will require a
flat*- frost if much fruit is not to be
J nipped.
In the sections that have the weevil
! incr< a«ed activity by the prat is
ported, and the weevils will g.-t prac
tically all the late fruiting whe-e
they ar so numerous
Buying has been fairly free, but
’ has come .liefly from those concerns
that entered into contracts during the
1 summer with the spinners. New
business has not been distribut 4
treely. according to the buyers in
this part of the belt, as spinners are
not yet disposed to accept the revised
crop id« as and »ay they will buy lust
as little as possible until more defi
nite opinions • m be formed. 1’ ie
firmness in numet and difference ’n
< oet of raw material compared with !
a year ego both encourage this wait
ing attitude, no matter how much
they have to buy later and at wha<
prices.
Tin* labor troubles at Texas pons
have inurfered to <-ome extent with
buying in that territory and cans .I
sonic operators to go to the Atlantic
sections for entton for irnmediite
shipment. This is thought to have
helped in boosting quotations in that
direction faster than they have ad
vanced in the Southwest.
Movement is running as freely as
expected, but the interruption to pick
ing because of the wet spell will tend
to check receipts temporarily. There
has been nothing like “distressed’’
cotton in evidence yet anywhere.
Canadian Exports
Os Wheat Are Small
' BuHs Exaggerating. Pritchard Says.
All Grains Show Price Losses
for the Day.
By JOS. F. PRITCHARD
CHICAGO, Sept. 20—While the Mills
have made considerable noise over the
1 reported export takings ”1 ('anadian
| new wheat. I learned to-day that only
‘2.1*09.000 bush< Is of Canad<an m w crop
, have b» en taken thus far. For the < um
parative p. r < <i in 1912. the takings were
; reported at 13.00C.000 busbrh
I'hese conditions in Canada are in
the face of a record <r* p < f milling
grade wheat. Only ‘ ooo.< 00 bushels of
wlu.i! have been booked to date at the
head of the I.akes for bax ports while
ia year ago the amount booked was
! around 12.000.000 bushels. The reason
■is that Canadian prices are too high
• lor the buyers in l-Jngland.
There was lack of buying power m
I W’heat to-day and prices closed % f<? I
(•ent lower. Cash sales here were only
j 85.000 bushels. There wore 1 1.791,000
busht’s received at primary markets
i ihis week compared with 14.841 000
! bushels. 1912.
The corn market showed losses of
%•'»» %<■. in the face of beavv rains
through lllinui.s and the Ohio Valley.
‘Receipts here this k were 4,292.00)
1 bushels, nearh double 1912 There were
6.279.000 bu«hels received at primary
points .300.000 bushels larger than the
week before. t’a«h sales of corn were
small to-day. 45.000 bushels.
• >aats were « as:er and prices showed
! net losses of about %c for the day.
| Cash prices wen steady
I 'fhe selling of hog products by pack
ers was the dep' s<mg factor of the
| day an ! caused recessions. Tnere was
some selling also by the provision and 1
grain trade of lots wh : < h were pur- j
chased earlier in the week
Grain quotations:
Previous
High. Low Close. Close
WHEAT—
Sept 88 57% 87% 88%
! Dec. . . IH»% 89’. i
May 95% 94 94% 95%'
! CORN—
I Sept 7SL. 74U
i D’-e. . . . 72% 72 72% 72%
iMay. ... 73% 73 73% 73%
OATS—
iSept 41% 41% 41% 41%
I Dec 44S 43U,
May. .. 47', 46 % 46\ 471<,
PORK -
Sept.. 21 15 21.15 21 15 31.30
Jan ... 20 12'- V'.'2S 2'0.00 2C-.12L-
May. . -'0.25 20.10 20 12'- 20.25
I.ARP-
jSept.... ’l.:;'. 11.13 L. 11.15 11.175-1
Joct . ”20 n ii 'i ,
Jan. 11 10 10.1 CL 11.07’i 11.0? L.
RIBS—
I Sept. . 11.124 s 11.071; 11 12U 11 15
Jan.. . 11 00 1152'.. 1157, li „ii
May. 0.724* 10.674 slO 674- 10 75
CHICAGO CASH QUOTATIONS. i
CHICAGO. S', 1. 20 Wheat No 2
: red. i'.’ 3 , 'v ; No 3 r OOfil'S: No. 2
hard w.nt«r. SB% iS9%. N- 3 hard w.n
--v x . v n. • \ ■ spring
91 % . No 2 Nc-thern spring. •
:1 % . N-• 3 spring. 87 e>"
(’••rn- N<» 2. 75% t 76: N. 2 white
'7s’- -i76: No 2 \.d!ow, 75% u 76; No 3. i
No 4.
N • .s : -•• 74 . No. 1
Oats N./'-j wbjte C’- >’ • 3 white.
>4l % %' No i White, 41 ••_■ «/ 42: stand- ’
aid, 43(y43%
Senator Owen Explains Currency
•J*®-? - •!•••;• •s••4*
How Banks Will Handle Paper
■$•••!•
Federal Reserve Assures Safety
Government Provided With Ample
I .
| Safeguards Against Loss by the:
Failure of Borrowers or Banks.
! Market for Short-Term Notes.
By ROBERT L. OWEN.
(Senator From Oklahoma.)
The Federal reserve banks
CSt'c. 15 > are "riven the “power”
“to deal in gold coin and bullion,
both at home and abroad, to
make loans thereon, and to eon
tract for loans of gold coin and
bullion, giving thereofre when
necessary acceptable security, in
cluding the hypothecation of
“United States bonds.”
i The obvious purpose of this is to
tenable these banks to protect the gold
reserve of th€> country. But they have
< the further power
“to invest in United States bonds
and bond: issued by any Stat**,
county, district or municipality.”
■ and obviously with these securities
! they could also obtain gold to pro
; tert the gold reserve of the nation
i and of their owe banks.
But they .'ire further given power
“to purchase from member banks
| and to sell, with or without its
indorsement, bills of exchange
. ■ arising out of commercial trans-
actions, as hereinbefore defined, ■
payable in foreign countries” (this
• light to Include domestic ex
changes also), “hut such bills of 1
exchange must have not exceed
ing 90 ■ ays to run and must bear
the signature of two or more re
sponsible parties, of which the ‘
last shall be that of a member
bank.”
It is obvious from this power that a '
market is immediately created for;
foreign bills of exchange (and it ought t
to include domestic bills as well).
And it has further power
“to open and maintain banking
accounts in foreign countries and
establish agencies in such coun
tries wheresoever it may deem
best for the purpose of purchas
ing. selling and collecting for
eign’* (it should be or domestic)
"‘bills of exchange and to buy and
sell through such correspondents
or agencies prime foreign bills of
exchange arising out of commer
cial transactions which have not
exceeding 90 da vs to run and
which bear the signatures of two
or more resnonsible parties.”
Open Market Provided
Fcr Exchange Bills.
f Under this power there is an open
market provided for handling bills of
exchange and making available fori
American use. or establish foreign
market for such bills of exchange, and
obtaining money at a low rate of in
i terest.
Under Section 14, any Federal re
serve bank
I "Upon the Indorsement of any
member bank • • * may discount
notes and bills of exchange aris
ing out of commercial transac
tions — that Is. notes or bills of
exchange Issued or drawn for ag
ricultural. industrial or commer
cial purposes, or the proceeds of
which have been used or may be
used for such purposes, the Fed
eral Reserve Board to determine
or define the character of such
' paper. This paper must be of
short fixed maturity—not more
than 30 days.”
! It is obvious that there is no limita
tion upon this discount power, ex
cept that the reserve bank must keep
33 1-3 per cent gold or legal tender
: against its demand liabilities.
Restrictions Imposed on
Longer Term Paper.
Where the reserve bank has more
than 33 1-3 per cent in cash against
its outstanding demand liabilities, ex
clusive of Its outstanding Federal re
serve notes by an amount to be fixed i
1 bv the Federal Reserve Board. It may ■
j discount such bills of exchange where
1 the maturity does not exceed 120 days,
■ but not more than half of such paper
' i so discounted for any member bank
shall have a maturity of more than 90
1 days The member bank may also dls-
■ count acceptances of banks which are
I based on the exportation and irnpor-
: tation of goods whl h mature In no:
more than six months, and which bear :
: the signature of one member bank In ;
! addition to that of the acceptor: but :
I the amount so discounted shall not
; exceed one half of the actual stock of
J the member bank for which such re
f discounts are made.
I These notes or acceptances coming ;
■ Into the hands of an ordinary na- .
ttonal bank wou’d be in iorsed and de- ,
livered to the reserve bank as collat-
Pearsons Invade
Colombian Republic
Forty-Year Concession Granted Brit
ish Bankers Who Are to
Exploit Oil Fields.
Spec'al Cable to The American.
LONDON. Sept. 20. —The banking
firm of S. Pearson & Sons has Just :
Secured, through Lord Murray, a val
i liable concession front Colombi i
whereby the Pearsons secure the right'
to explore virgin territory known to j
contain valuable petroleum and min- ■
er.il deposits. The Pearsons must ’
spend SIOO,OOO a year for the next],
live years in exploration. A valuable,
■ concession just has b. en secured from | ,
Ecuador by the Pearsans.
The Cole.mbian concession permits ;
the Penrs.tn- to establish refineries,
build railroads ind docks. The con-I !
cession Is for 4u years. It was se- . '
, cured after k- en competition against ‘
firms in the United States and Con- •
tinental Eur- ■ ■
CLEARINGS. | 1
NEW YORK Sept. 20- Bank clear- i
■ ings to-day $305,502,066 Holiday a '
year ago. 7
Author of the Measure '
Clears Obscure Points.
Just how banks will go about
their dealings with the new Fed
eral res erve banks is a question
of keen interest to bankers and
also to the mercantile commu
nity.
The handling of commercial pa
per under the Owen-Glass cur
rency bill is a point on which en
lightenment has been sought re
peatedly.
Senator Owen, who was a bank
er, and who is Chairman of the
Senate Committee on Banking and
Currency, has. on the invitation of
The Sunday American, prepared
a careful explanation.
oral security for loans extended to the
member bank. They would be put in
the collection portfolio of the reserve
bank. If the reserve bank wanted to
get Treasury notes on these bills of
exi'hange and acceptances, it would
place them in the custody, or under
the control, of the Federal reserve
agent located tn the office of the ra
serve bank, and he would pay the re
serve bank Treasury notes in ex
change for a like volume of these
commercial bills of exchange and ac
ceptances which he. of course, would
pass on.
How Note Retirement
Is Expected to Work.
■ When these notes are paid thev
I will be paid at the counter of the
I member bank, and will be sent there
for collection, and when the returns
i are remitted ami the reserve bank
I paid, the member bank will be
.credited with the returns on the loan
previously made the member bank
land the reserve bank will repay
Ito the Federal reserve agent the
Treasury notes previously borrowed
on such paper. The* Treasury notes
thus retire from circulation.
Doubtless in ordinary practice, as
the member bank would draw down
certain notes tor collection and pay
ment It would substitute other notes
of like charcter in lieu of the notes
maturing, and in this way always
keep an adequate margin arid accept
ances of a qualified class as security
in the hands of the rest rve bank, and
the reserve bank in like manner
would keep a like adequate security
In the hands of the Federal reserve
agent just as Is now done in the com
mon banking practice wher a note
about to be paid Is replaced by an
other note of like or greater value.
If the Federal reserve bank de
sired, it could sell these notes with
out indorsement to banks having
idle money, ami in this way a market
would be built up for commercial
I paper which would be of the great
est value in enabling the manufac
turers. merchants and business men
of the country to market thelr
credits upon the indorsement of
their home bank. In this way ac
commodatlon could be furnished to
farmers against agricultural prod
nets, to manufacturers .against manu
factured products, to wholesalers and
brokers against merchandise in tran
sit, and the rate of discount in all
of these cases would be fixed by the
Federal Reserve Board.
Chances of Loss Not
One Out of a Billion.
In answer to a question, “What
would hapen if the man making the
note should become bankrupt?” the
answer is that the man to whom
credit will be extended on a four
months’ note by a solvent ba tk is
not apt to fail within four months.
. The chances of his failing must be
considered, however. It is far less
! than one in ten thousand The mem
' her bank of good standing undei the
• bank examiners’ report failing within
■ the fixed period of four months is
• not one in a hundred thousand.
The measure of probability of both
the maker of the note and the hank
both failing within the fixed period
of four months is one in ten thousand
! times a hundred thousand, or one out
iof a billion. But in such a contin
gency the Government has the safe
guard of the reserve of the member
bank on deposit: it has also the fur
ther security of the stock of the
member bank so failing, and in the
event that this should not suffice
it has the double liability of the pri
vate stockholders of the member bank.
In adidtion to against this re-
■ mote contingency; it has 33 1-3 per
! cent lawful money reserve of the Fed-
• oral Reserve Bank; ar.a in addition
to this it has a first lien against
the entire assets of the Federal Re
serve Bank, and the double liability
of the stockholders of the Federal,
Reserve Bank, consisting of an aver-
! age of probably five hundred national
! banks, so that the possibility of loss is
not to be considered.
Wisconsin Attacks
Northern Pacific
Railroad Accused of Failing to Pay
Fee on New Stock —Charter
Forfeiture Demanded.
|
MADISON. WIS . Sept. IS —Attor- :
ney General Walter C. Owen ap- ;
pea red in the Supreme Court to-day ;
and asked for permission to file an j
information in the form of a quo I
warranto proceeding to determine i
why the charter of the Northern Pa
cific Railroad should not be forfeited.
He claimed the company did not
pay the fee required by the Wiscon
sin laws for increasing its capital
stock. On an increase of $250,000,000
of stock, he says, the amount due is
$250,000. Tiie question will not be
argued until some time in October.
BAR SILVER.
NEW YORK, Sept 20. Bar silver in
Lon*’"n to-day was 1-16 penny lower
at 28 5-16 d per ounce. To-day’s New
York price was 'se lower at
Mexican dollars, 46^,@50.
PUBLIC TAKING I
UP SPECULATION
111 COTTON Bffi
Lack of Leaders Only Prevents
Lively Bull Campaign—Fancy
Spots at Sixteen Cents.
NEW ORLEANS, Sept. 20 -The
rains recently reported in the western
belt, which caused a declining t -n
--dency In the market last week, now |
have turned out to be a bullish argu- J
ment, as the continued precipitati n
has resulted in considerable damage
to the open cotton in that section
Reports of cotton sprouting in me
boll as a result of continued and ex
cessive moisture arc coming in from
Texas and Okl ihoma, so that it would |
seem the Injurv done to the crop b.
the drouth is being comnDut! by :) e i
prolonged spell of wet weather.
Liverpool had been ra + indiffer- !
< nt to the reports of damage hy rains, i
Flit was booming this week, and ca- I
bier received from lead’ng Liverpool
houses stated that the advance on
that side had been caused by unfi
vorable crop news from Texas and
Arkansas.
The outside public, however, is he- j
ginning to nibble at the market In a ■
way that suggests an outburst of i
speculation on the long side if the '
bull leaders would only pass the word '
along to get into the, ’ame good and ;
strong. News from Washington re- !
cently has been distinctly favorabl i
in regard to the prospect of the Clarxe ,
bill being amended in conferen •'* I
committee so as to legalize future j
trading as conducted under the rules
and regulations of the New Orleans '
Cotton Exchange. Definite action by i
the conference committee, putting
quietus on the Clarke bill in its pres
ent form, would be the signal for the
inauguration of a bull campaign in
th'- cotton market.
During the present week a bearish
feature, which had been made mwh
of, has disappeared completely. Tn?
demand for spot cotton is no long?r
slack. On the contrary', the demand •
for actual cotton has become strong, I
and spot quotations are now on a i
parity with contracts, and at one time •
this week were ruling above contract .
prices.
Fancy staple cotton sold in this
market tb’s week at 16 cents, ani
many of the planters shipping cotton
to factors here are giving instructions
to hold for higher prices. The result
is a strong spot demand, with com
paratively light offerings.
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you jhut it off. No continuous winding, or setting, and no forgetting.
The “Western” 8 Day Alarm Clock has an extra large face 444
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across the average room with ease. It is a reliable timekeeper and
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This coupon and $225 entitles sender to one “Western” g n av
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Western Merchandise & Supply Co.
CHICAGO, ILL.
SEES COSTLY
ELSEIERE J 5
WELLJSHEOE
Whitcomb Company Tells How the
Packers Are Importing Beef
From Across Equator.
"Part, at least, of the hiah cost f
living is not due to causes in any way
peculiar to Atlanta, but to conditioi s
which are of national and even ln
i ternational scope,' remarked W. M.
Burke, of the H. 11. Whitcomb .t
! Burke Co., grocery brokers. No. 149
i Madison avenue.
“It may be true that meat prlcee
lin Atlanta are higher than in any
other city except Boston, as the Qov
, ernment report indicates. I do not
I know the answer to that. But meat
, prices, all the way from Bangor t>
Seattle and between, are too high. TH#
reason is scarcity of cattle.
"Take Libby, McNeill & Libby a»
examples. Tne firm is unable u>
l make full deliveries of its canned
products just now. simply because It
can not get the raw materials in suf
! ficient volume. Other ackers are in
I the same plight.
; "The shortage is so acute that it
now Is profitable to iport fresh beet
: from Argentina and Australia. Llb-
I by's now are bringing large quantl
| ties from South America
"Between 2,000,000 and 3.000.000
; pounds of fresh beef, practically all
from Australia and Argentina, en
| tered the United States tn the last
I three months, indicating that he t>-
i tai for this fiscal year will exceed
5,000.000 pounds.
"Prior to 1912 the importations ot
fresh beef averaged about one-third
of a million pounds per annum.
"The import prices range from ap
proximately 7 cents to 10 cents per
pound, the average having been from
i Australia 6.9 cents per pound, from
England 9.6 cents per pound. These
' are the tiger- s of value in the coun
i try from which the acet Is sent to the
• United States, and do not Include the
I c.-st of transportation or the tariff of
1 1-2 cents per pound "
NAVAL STORES.
NEW YOItK. Sept, 2"—Turpentine
steady, 42: at Savannah, 394?395,; C to
G ros’n strained. 4.05 .r 4.10. tar In bar
rels, 5.60