Show I. I TIlE THE nE DAILY NEW YORK Financial FT n a n c j a I AI Whirligig h j rH 9 I 9 Written for tor Tho The Telegram by JAMES McMULLIN N. N NEW Y V YO O 0 R II K K K-Hearst's Hearst's enlistment enlist enlist- merit ment of Matthew vice vicc vice president prest I. I dent of at the American Federation of at Labor as Labor as assistant for his campaign against t communism in the c colleges falls fails to disturb the educators' educators peace o of mind W sees red almost as easily as Congressman Congress Congress- man un FL Fish h. h Moreover the teachers who fear a drive to muzzle them believe the Hearst is t more likely to boomerang on than to hurl hurt their cause The publisher is none too popular with organized labor and labor and it would be most surprising if it the unions were wera to play his game just because Wok does docs But it does look as lS If JC the Jib liberal ral educators would lose Jose out on their cherished hope of or having Hearst's methods investigated by the thc Mc- Mc Dickstein Cormack-Dickstein committee on American un-American activities There are arc signs that the committee has so littIe little lit lit- tIe lie appetite for lor the Job it will call of off the whole hole show b by declining to ask for tor further lurther appropriations rather than carry out the teachers teachers' request Its It's unusual for congressional congressional bloodhounds to drop a scent olun voluntarily rily but this trail might lead to more trouble than fun This means the educators will have to find another sounding sounding- board for their charges that Mr Hearst is trying to cow them into extreme con conservatism They dont don't know yet what channels they'll use we but they have no intention of letting letting let let- Un ting their grievances die for tor want of or airing I Most of or the chiseling on soft sort coal prices which has stirred John Lewis as indicated recently in our Washington Washington Wash Wash- ington n column arises from the narrowing nar riar- rowing of or the cost differential between between between be be- tween northern a and n ci southern mines In the old d days ys northern workers were paid about 40 cents an hour and southern about 17 Now the figures are arc closer to 80 and 60 The change has made it po possible ible for lor northern operators to invade territory territory ter ter- ter which the southern as their own Insiders understand understand un un- un- un nd that certain regional code authorities have winked at price cutting aimed to regain former formel competitive ascendancy But despite de do- spite spit these violations coal men agree that the tho code has been manna from heaven both to a starving industry industry in in- and its workers They only hope their present prosperity isn't too good to last I a aFew Few people realize how v completely com corn the soft olt coal conI business has ha been unionized Several companies which swore they would rather dig dil turnips than work with John Lowis Lowi are arc still in business and business and dealin dealing with him Even th those these se stubborn outposts outposts outposts out out- posts of or the open sho shop the shop the thc captive mines owned by the big steel companies com corn panics have have quietly given in and andare andare andare are paying the thc off check for all their workers They save face by not paying it technically to the United Mine Workers but the camouflage cah is very thin This mak makes s the closed shop n R fait accompli in practically the whole industry Even Lewis' Lewis opponents opponents opponents op op- op- op admit he has done a swell organizing job S e Many Wall Wan streeters can see nothing noth rioth- in ing but bul doom ahead for Utility common common cornmon com corn mon and preferred stocks and for holding company bonds under the new deal power policy though policy though admitting admitting ad ad- that underlying bonds of or operating companies may not nol be much affected But astute observers ers with rate first Washington contacts contacts contacts con con- doubt the accuracy of such a simplified formula for the future As the they see sec it the new deal has two objectives tives as regards ties tics ties One is to cut down the competition compe compe- competition of paper with merchandise for lor absorption of at public spending spendin power The oU other oUr r is to compel private private private vate corporations to adapt and maintain their capital structures In iii realistic tic terms It will be m made de increasingly in in- increasingly difficult for lor companies to use we their Imaginations Imagination on balance sheet values On this bails basLi if II'S figured tha that stocks which had actual worth behInd behind behind be be- hind them from the beginning will have nothing to fear tear But tho those which started as water are expected expect expect- ed d to end nd up a us as steam with the help of or the fires to be built buill under them theta a a a aFew Few financial developments of 1934 1034 impressed experts so much as the strength of or bon bonds bond Bond tranSactions transactions transactions trans trans- actions were the heaviest in 10 years years years-on on a rising market while market while stock were the smallest inthe in m inthe the same period The record activity was wu largely due to huge dealings in governments govern govern- men ments The small volume of new corporate financing forcing financing forcing Institutions institutions in institutions in- in and investors to buy buyout buyout- outstanding outstanding out out- standing issues was issues was al also o oa a factor But the essential point is 13 that bonds have added 5 billion dollars to their open market value in a year of at active e trading Just a year ago go Wall street prophets were confidently predicting predict predict- ing the complete c collapse Jl p of the bond market and a wide advance in equities on the theory that inflation in in- was about to run amuck Thousands of bond owners have found it lL was fun to b be fooled tooled 0 a aa One of Washington's Washingto-n's most effective ef d- ef- ef moves toward loosening up long Jong term credit went almost unnoticed unnoticed unno unno- last week Federal reserve member banks are now JIOW aU allowed owed to buy new issues dir direct ct from the issuer if it there is a broad market for lor the latter's existing securities Fear of a sluggish reception h ha has held up man and this bugaboo is now eliminated The banks will be delighted to sweeten their investment kitties in this way and theres there's no longer any risk that a sound issue will go begging Copyright McClure Newspaper Syndicate |