BINDINa LIST JAN 1 1923
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ESTABLISHED 1867
The Monetary Times
Trade Review and Insurance Chronicle
OF CANADA
-0^
i j^j^B 81 1922
Index to Volume 66
January to June, 1921
^ lb I
Published every Friday by The Monetary Times Printing Co. op Canada, Limited
Head Office: Corner CHURCH and COURT STREETS. TORONTO, ONTARIO
Telephone Main 7404, Branch Exchange connecting all Departments
Cable Address: "Montimes, Toronto"
Hf
The Monetary Times
INDEX TO VOLUME 66
January to June, 1921
CONTRIBUTORS AND THEIR
CONTRIBUTIONS
PAGE
Allan, John A., (Recent Mineral
Developments in Alberta), March
18 26
Arnold, Hugh E., (An Aspect of th»
Exchr-nge Problem) , March, 18.. 36
Barker, A. B., (Co-operative Mar-
keting of Grain), March, 4 .... 18
Barker, A. B., (Section 88 of the
Bank Act), April, 15 22
Barker, A. B., (Foreign Trade
Machinery is Delicate), May, 13 IS
Barker, A. B., (Why Bank Credits
Are Short Tenn), May, 27 .... 22
Barker, A. B., (New Methods in Oil
Promotions) , June, 17 3
Cassidy, Edwin, (American and
Canadian Tnast Companies),
May, 13 20
Gates, W. B., B. A., (Should Cost of
Imperial Navy be Shared in),
April, 29 5
Gates, W. G., (Turnover Tax and
an Extended Tax on Sales). May,
6 5
Chichanot, E. L., (Unemployment
Situation in Canada), March, 11 14
Chicanot, E. L., (Immigration and
Unemployment) , May, 20 ... . 18
Chicanot, E. L., (American Interest
in Canada), May, 27 18
Clarke, J. L., (Short and Long Term
Rural Credits), April, 22 . . . . 14
Dower, J., (Quarter Billion Loss,
Who's Responsible ?), May, 20 . . 32
Drummcnd, A T.. (Dominion Con-
trol of Water-Powers), May 27 14
Elliot, J. Courtland, (Economic
Developments in Western Can-
ada), January, 21 37
Finlayson. G. D., (Fifty Years of
Fire Insurance in Canada) , Feb-
ruary, 11 18
Good, John, (New Hazards to Plate
Glass), January, 14 33
Howard, B. E.," (The Spirit of
Enterprise Desei-ves Fostering) ,
Febi-uarv, 11 36
Hunter, R. W., C. A., (Premises
Tie up Banking Capital), May. 20 30
Jackson, Gilbert E., (Unemploy-
ment Insurance in Canada, Possi-
bilities of). March, 18 5
James, F. J., (Local Financing
Proved Disappointment) , Febru-
ary 4 22
Johnston, V. Kenneth, (Advantages
of the Gross Sales Tax), May, 6 14
Jones, S. L., (Transatlantic Trade
Relations), January, 21 34
Lauriston, Victor, (Investing in
Oil), May 20 28
Lyell. Angus. TThe Bankruptcy Act
in Operation), Janurr:;- 14 . . . . 2(5
Lvoll. Angus (WTiat Labor Wants?).
January, 21 41
PAGE
Lyell, .Ang-us, (Organized Farmers'
Movement is Economic), Febru-
ary, 18 34
Lyall, Angus, (The vVheat Pool), ^/
'March, 2.5 18
Lyell, Angus, (Alberta's Municipal
"Hospital System), April, 1 .. .. 24
McLeod, Alfred W., (Industrial In-
surance), March, 25 26
Noble, J. L., (British Columbia Fire
Underwriters' Association) , May,
27 d28
Paterson, R. J. R., (Municipal Ac-
countin£r and Municipr.l Finance),
March, 18 18
Pratt, H. J., (The Financing of y
Public Utilities), April, 8 .. .. 22''
Reid, E. E.. (Life Insurance With-
out Medical Examination), Feb-
ruarv, 18 5
Rife, Raleis-h 3., (Financial Rela-
tions Avith tho United States),
January 14 IS
Smith, R. Goldwin, (Mining Produc-
tion in 1920), January, 21 .. .. 18
"Semner Paratus" (Bankin"- Op"or-
tunit-'es an 1 the Aftei-math) , Feb-
i-uarv. 18 18
Sto»-hPnson, H. R., (Health and
Accident Features in Life Poli-
cies) , January, 28 5
Tavlor, Jame<;, (Adiustment of Fire
Tnsurancp Losses^. May, 27 . . . . 24
Wainwris-ht, Cpcil S.,_ (Fire
Insurance in Canada in 1920),
February, 4 26
PRIMARY INDUSTRY
Alberta Farmers through with
Gambling, May, 6 8
Alberta, Recent Mineral Develop-
ments in, Marcli 18 26
Asbestos in Quebec, February, 25 . . 44
British Columbia Fisheries —
Mav, 13 28
M-^y 27 36
Coal Mining in Nova Scfitia, Janu-
ary, 14 44
Coal' Trade in Nova Scotia, Steel
and. May, 20 36
Coal Trade is Depressed, January,
21 48
Cobalt Ore Shipments in 1920,
January, 21 _. . 26
Co-operative Marketing of Grain,
March, 4 18
Cron Outlook, The (Editorial) . June
17 4
Crops, Potatoes, Roots and Fodder,
January, 21 14
Crops. Rpcord Value of Canadian
Field, February, 11 14
Farmers Hit Bv Coal Mining Situa-
tion. April, 29 12
Farmina: Operations may be Cui'-
tailed, April, 15 14
Farming Outlook in the West,
April, 29 12
PACE
Farmers Through with Gambling,
Alberta, May, 6 8
Field Crops, Record Value of
Canadian, February 11 14
Fisheries in British Columbia —
May, 13 28
May 27 • • 36
Flax Growing in Nova Scotia, April,
1 28
Forest P'ires Starting Again (Edi-
torial), May 13 10
Forests, Mean to Canada, What
They, Januai-j% 28 14
Gold and Silver Production, World's,
April, 22 36
Grain, Co-opevative Marketing of, /
March, 4 18 '^
Land Values Increased, Average,
March, 25 • ■ 32
Lumbermen's Association, Canadian,
February, 11 26
Mineral Developments in Alberta,
Recent, March 18 26
Mining Production Increased in
1920, January, 21 18
Mineral Product'on Increased in
1920, March, 25 22
Miu'ng in Nova Scotia, May, 13 . . 28
Mining Properties, Taxation of,
February, 25 42
Newfoundland's Industries Under-
went Strain in 1920, February, 11 30
Nickel Plant Affected by Metal
Market, April 8 28
Nob'e Faini is Big Enterprise, June,
1/ 1
Nova Scotia Mining, May, 13 ... . 28
Oil, Invesfng in. May, 20 2S
Oil Promotions, New Methods in,
June, 17 3
Ore Shipments in 1920, Cobalt,
January, 21 • ■ • • "'^
Promotions, New Methods in Oil,
June, 17 3
Salmon Pack. Curtailment of British
Columbia, May, 27 36
Seedino- Now General in Alberta,
April, 29 7
Silver Production, World's, Gold
and, April, 22 36
Weather, A Ganble on the (Edi-
torial), Apr ' C2 10
Wheat Pool. The, March. 25 ... . 18
Wheat Touches the Dollar Mark,
(F'iitorial), April 29 10
Wrr] 'Gro'^'.-s Establish British
Agency, June 24 11
Wool Growers Hopeful for Absorp-
tion of Production, May, 20 ... . 36
LIFE INSURANCE
Accident Features in Life Policies,
Health and, January, 28 5
Actuarial Society of America Meet-
ing, May, 20 49
Agency Busmets, Facilitating
(Editorial), March 11 10
Agents, Control of Life Insurance
(Editorial), May, 27 9
Index
THE MONETARY TIMES
January 1 lo June 30, 1921
PAGE
Amendments to Dominion Insurance
Act (Editorial), April 22 9
Banks vs. Life Insurance, March, 18 32
Companies' Power to d« Business,
Dominion, April, 8 5
Compensation, Proposed Increase in
Workmen's, February, 11 ... . 5
Dominion Insurance Act Amend-
ments (Editorial), April, 22 . . . . 9
Examination, Life Insurance With-
out Medical, February, 18 ... . 5
Health and Accident Features in
Life Policies, January, 28 ... . .5
Income Tax, Life Insurance and the
(Editorial), May, 20 10
Insurance Act Amendments, Domin-
ion (Editorial), April, 22 9
Insurance Companies' Position Im-
roved (Editorial), April 5 .... 9
Insurance Companies, The Scope of
Editorial), January, 28 9
Insurance in Ontario in 1920, May,
20 14
Insurance in 1920, Records Estab-
lished, April, 5 5
Life Insurance Agents. Control of
(Editorial), May, 27 9
Life Insurance and the Income Tax
(Editorial), May, 20 10
Life Insurance a Profession,
Making: (Editarial), March, 25 10
Life Insurance Business Conser-
vation of (Editorial), March, 4 9
Life Insurance Taxes in Quebec,
January, 14 14
Life Insurance, United States Tax
en, June 17 12
Life Insurance vs. Banks, March, 18 32
Life Insurance Without Medical
Examination, Febniary, 18 . . . . 5
Life Policies, Health and Accident
Features in, January, 28 5
Life Policyholder, Reinstatement of,
May. 6 26
f ife Underv/riters Meet =n Winni-
pet;', April, 8 g
Medical Examination, Life Insur-
ance Without, February, 18 5
Mutual Benefit Raises Rates,
Travellers' January, 21 34
Ontario Insurance in 1920, May, 20 14
Policyholder, Reinstatement of Life
May, 6 26
Profession. Making Life Insurance
a (Editorial). March, 25 10
Quebec, Life Insurance Taxes in,
Januarv, 14 ... 14
Soldiers Insurance, March, 18 ... . 20
Tax on Life Insurance, United
States, June, 17 12
Travellers' Mutual Benefit Raises
Rates, January, 21 34
Underwriters Meet in Winnipeg,
Life. Anri], 8 8
United States Tax on Life Insur-
ance. June. 17 12
Winnipeo-. Life Underwriters Meet
in. April. R 8
Workmen's Compensation. Proposed
Increase in, February, 11 5
TRADE AND INDUSTRY
Asbestos in Quebec, February, 25 44
Board of Trade Reports —
February, 4 18
Februarv, 11 '..... 30
Britisli Capital in Canadian Indus-
t'-\-. May. 20 36
British Cattle Embargo, The
(Editorial), April, 1 9
British Manufacturing in Canada
Affected by Exchan<re, Anril, 1 .. 28
Buildinn- Permits in 1920, February,
1.8 ." . 26
Buildin" Permits, November, Janu-
ary, 14 36
PACE
Building Permits in December,
February, 18 22
Building Permits, January, March,
18 22
Building Permits for February,
April, 22 24
Building Permits in March, May ,20 22
Building Permits in April, June, 24 11
Business at the Coast, May, 13 . . 7
Business Improvement in the West,
Signs of, January 14 8
Business, Too Much Cancellation of,
(Editorial), Januai-y, 14 10
Canadian Manufacturers Associ-
ation Convention, June, 17 ... . 10
Canadian National Export Club,
April, 29 8
Cattle Embargo, The British (Edit-
orial), April, 1 9
Cement Production in Canada, Feb-
i-uai-y, 18 44
Central Factories Building, Pro-
poses, March, 4 8
Coast, Business at the. May, 13 . . 7
Commercial Failures in Canada in
1820, January, 14 24
Dominion Industrial Products, Ltd.,
February, 18 44
English Electric Company will
Enter Canada, March, 25 44
Export Club, Canadian National,
April, 29 8
Factories Building, Proposes Cent-
ral, March, 4 8
Failures, A Crop of Business, April,
^9 22
Failures, Business. (See every
issue).
Failures in 1920, Analysis of,
March, 25 38
Failures in Canada in 1920, Com-
mercial, Janusry 14 24
Prilures, Speculation and (Editor-
ial), January, 28 10
Flour Mills on Part Time, March, 11 28
Foreign Trade Machinery is Deli-
cate, May, 13 ... : 18
Forests Mean to Canada, What the,
January, 28 14
Great Britain Will Soon be in
World's Markets Again, April, 29 28
Hamilton's Industrial Growth in
1920, February, 11 44
Howard Smith Paper Mills, Febru-
ary, 4 44
Industries are Reviving, June, 17 9
Industry, Municipalities Suffer by
Bonujing, May 6 ". 10
Industry, Immigration and, (Edit-
orial), March, 25 9
International Trade Situation in
Canada, Mrv 27 7
Iron and Steel, in 1920, February, 11 44
Iron and Steel Industry, Outlook
for is Good, February 18 44
Manufacturers* Association Conven-
tion, Canadian, June, 17 10
Newfoundland's Industries Under-
went Strain in 1920, February, 11 30
New Railways Not Wanted (Editor-
ial), April, 8 10
Nickel Plant Closed, April, 8 . . . . 28
Paper and Its Use (Editorial),
March, 18 10
Pap'r Price, Drop in, February, 25 44
Pulp and Paper Developments, Jan-
uary, 14 44
Pulp and Paper Developments,
January, 21 48
Pulp and Paper Developments,
April, 15 28
Puln and Paper Developments, May,
27 36
Puln and Paper Industry in the
West, February, 25 44
Puln and Pan°r Industry is Troubl-
ed, April, 22 ■ 28
PACE
Pulp and Paper Industry Meeting
with Keen Competition, April, 29 28
Pulp and Paper Industry (5utlook,
January, 28 36
Pulp and Paper Industry, Tracing
the Growrth, February, 11 44
Pulp and Paper Mill at Connaught
Station, May, 27 36
Pulp and Paper Prospects of the
West, March, 4 32
Pulp and Paper Trade Prospering,
March, 25 44
Pulp Mills Closed, May, 20 36
Rail Orders Will Help Steel Indus-
try, January, 28 36
Railway Situation Considered in
Parii.ament, March 25 7
Railways Not Wanted, New, (Edit-
orial), April, 8 . 10
Retailers Now Taking Losses, May,
20 5-
Rubber's Rise and Fall (Editorial),
April, 15 10
Salmon Pack, Curtailment of Brit-
ish Columbia, May, 27 36
Shawinigan Water and Power Ship-
ping Line, April, 15 28
Sherbrooke and New Industries,
March, 25 44
Shipbuilding in British Columbia
in 1920, Steel, January, 14 ... . 44
Shipbuilding, Some Hope for, April,
29 28
Shipping, Year of Contraction in,
March, 4 20 v^
Steel and Coal Trade in Nova
Scotia, May, 20 36
Steel in 1920, Iron and, February,
11 .". 44
Steel Industrv and Railway Equip-
ment, April, 8 28
Steel Industry Cannot Expect to
Look to Britain, February, 4 . . 44
Steel Industry Immediate Revival
Not Expected, January, 21 ... . 48
Steel Industry, Outlook is Good.
Febniary, 18 44
Steel Industry, Rails and the, Jan-
uary, 28 36
Steel Industry, The, May, 27 ... . 36
Steel Rails May Be Needed in
Large Quantities. January, 14 . . 44
St°pl Shinbuilding in British Colum-
bia in 1 920, January. 14 44
Tanning Industry in 1920, (Editor-
ial), January, 14 10
Textile Companies Reduce Wages,
January, 28 36
Textile Conditions Improving, Feb-
ruary, 18 44
Textile Outlook Good, January, 14 44
Textile Prices Lower, January, 21 48
Toronto Industries in 1920, Febru-
ary, 4 44
Trade Machinery is Delicate,
Foreign, May, 13 18
Trade Mark, Registration of. May,
13 26
Trade Mark, Registration of, Mav,
20 34
Trade of Canada by Classes —
Januarv, 21 22
February, 25 22
March, 25 24
April, 29 22
Mav, 20 24
June, 24 9
Trade cf Canada by Countries —
February, 4 24
March, 4 22
Anril. S 20
Mav, 13 44
June, 17 12
Trade Outlook, The, January, 28 . . 16
Trade Relations, Transatlantic,
January, 21 34
January 1 to June 30, 1921
THE MONETARY TIMES
Index
PAGE
Trade Situation in Canada, Inter-
national, May 27 7
Transatlantic Irade Relations, Jan-
uary, 21 Si
Vancouver Board of Trade, March,
25 ^
Victoria to Draw Tourists, May, 20 8
West, Signs of Business Improv-
ment in the, January, 14 8
Wholesale Prices, Index Numbers
of—
January, 21 24
February, 25 24
March, ^5 14
April, 29 24
May, 27 24
June, 24 10
Woollens Price, Drop in, March, 4 32
Woollmgs Company, T. S., May, 27 36
FIRE AND MISCELLANEOUS
INSURANCE
Accident Features in Life Policies,
Health and, January, 26 5
Accident Payments, Some Sickness
and, February, 'lt> 34
Adjustment of Fire Insurance
Losses, May, 21 24
Agents' Commissions in Ontario,
Fire, January, 21 8
Alberta Hail Insurance Board,
March, 18 14
Alberta Workmen's Compensation
Results, February 25 28
Amendments to Dominion Insur-
ance Act, (Editorial), April, 22 9
Automobile Decision Case Postpon-
ed, June, 24 9
Automobile Insurance Next to Fire,
April, 15 41
Automobile Insurance Points, March
11 d24-
Bonded, Who Can Most Safely Be ?
(Editorial), April, 1 10
British Columbia Fire Agents' Con-
ference, February, 4 24
British Columbia Fire Underwriters'
Association, May, 27 d28
Caxton Insurance Company Obtains
Licens», February 11 46
Co-insurance and Use and Occupan-
cy, April, 8 18
Commissions, Fire Insurance Costs
and (Editorial), January, 14 . . 9
Commissions, Fire Insurance Costs
and (Letter to the Editor), Janu-
ary, 28 7
Commissions, Protests Regulation
of Insurance, January, 14 . . . . b32
Companies' Powers to Do Business,
Dominion, April, 8 5
Dominion Insurance Act Amend-
ments (Editorial), AprU, 22 .... 9
Dominion of Canada Guarantee &
Accident Co., February, 25 ... . 34
Edmonton Fire Underwriters,
March, 4 d26
Farm Property, Insurance Rates on,
June, 17 10
Fire Agents' Commissions in Ont-
ario, January, 21 8
Fire Insurance Costs and Commis-
sions (Editorial), January 14 ..
Fire Insurance Losses, Adujstment
of, May, 27 24
Fire Agents' Convention British
Columbia, February, 4 25
Fire Insurance Case, April, 22 . . 26
Fire lasurpnee Costi and Commis-
sions (Letter to the Editor), Jan-
uary 28 7
Fire Insurance in Canada in 1920,
February, 4 26
Fire Insurance in Canada, Fifty
Years of, February, 11 18
PAGE
Fire Insurance Policies, Mortgage
Clauses in, February 25 3S
Fire Losses, Decembei-, January, 14 22
Fire Losses, January, February, 11 26
Fire Losses, February, March, 11 24
Fire Losses, March, April, 8 . . . . 24
Fire Losies, April, May 13 24
Fire Loss, Quarter Billion, Who's
Responsible ? May, 20 32
Fires, Recent, (See every issue).
Fires Starting Again, Forest (Edi-
torial), May, 13 10
Fire Underwriters' Association,
British Columbia, May, 27 . . . . d28
Fii-e Underwriters of Ontario,
Mutual, February, 25 36
Forest Fires Starting Again, May,
13 10
Guarantee Bonds, Surety and (Edi-
orial) , April, 1 10
Hail Association, Saskatchewan
Municipal, March, 25 6
Hail Insurance Board, Alberta,
March, 18 14
Hazards to Plate Glass, New, Janu-
ary, 14 33
Healtn and Accident Features in
Life Policies, January 28 5
Health Insurance, Would Have
National, March, 11 d24
Industrial Insurance, March, 25 . . 26
Insurance Act Amendments, Domin-
ion (Editorial), April, 22 . . . . 9
Insurance Against Unemployment,
(Editorial), March, 18 9
Insurance and Fire Prevention,
Manitoba, March, 11 18
Insurance Commissions, Protests
Regulatioci of, January, 14 . . . . b32
Insurance Companies' Position Im-
proved, (Editorial), April, 5 .. 9
Insurance Companies, The Scope of,
(Editorial), January, 28 9
Insurance in Ontario m 1920, May,
20 14
Insuranci in 1920, Records Estab-
lished, April, 15 5
Insurance Licenses and Agency
Notes, (See every issue).
Insurance Rates to Be Revised,
Halifax, March, 25 57
Losses, Adjustment of Fire Insur-
ance, May, 27 24
Manitoba Fire Losses in 1920, Feb-
ruary, 18 8
Manitoba Insurance and Fire Pre-
vention, March, 11 18
Merchants Casualty Co. of Winni-
peg, February, 18 46
Merchants' Fire Risks, Retail,
January, 14 35
Mortgage Clauses in Fire Insur-
ance Policies, February, 25 ... . 38
Motor Accident, Decision on, June,
24 8
Municipal Hail Association, Saskat-
chewan, March, 25 6
Mutual Fire Insurance, Western
Canada, January, 21 44
Mutual Fire Underwriters of Ont-
ario, February, 25 36
National Health Insurance, Would
Have, March, 11 d24
Newfoundland Fire Losses Heavy,
March, 4 18
North ■ British and Mercantile
Insurance Co. Changes, March, 4 12
Nova Scotia's Fire Losses, March,
18 32
Occupancy, Co-insurance Use and,
April, 8 18
Ontario Insurance in 1920, May, 20 14
Ontario, Mutual Fire Underwriters
of, February, 25 36
Plate Glass, New Hazards to, Jan-
uary, 14 33
PACE
Quai-ter Billion Loss, Who's Re-
sponsible, May, 20 32
Retail Mei-chants Fire Risks, Jan-
uary 14 35
Saskatchewan Municipal Hail
Association, March, 25 6
Scope of Insurance Companies, The,
(Editorial), January, 28 9
Scottish Canadian Assurance Com-
pany Obtains License January, 14 35
Sickness and Accident Payments,
Some, February, 25 34
Sickness Insurance, Higher Rates
for, February, 25 34
Soldiers' Insurance, March, 18 ... . 20
Surety and Guarantee Bonds, (Edi-
torial), April, 1 10
Underwriters' Association, Brutish
Columbia Fire, May, 27 d28
Unemployment, Insurance Against
(Editorial), March, 18 9
Unemployment Insurance in Can-
ada, Possibilities of, March, 18 . . 5
Unemployment Insurance, Ways
and Means of, January, 21 ... . 7
Use and Occupancy, Co-insurance,
and, April, 8 18
War Veterans Insurance, Advises
Changes in, June, 17 1
Western Canada Mutual Fire Insur-
ance, January, 21 44
Workmen's Compensation Results,
Alberta, February, 25 28
COKI-ORATIOW SECURITIES
AND FINANCE
Abitibi Dividend Rate Cut, April, 1 38
Abitibi Power and Paper Co., Bond
Issue, March, 4 42
Alberta Flour Mills Stock Issue,
January, 28 8
Anglo-American Motors ? Ltd.,
(Editorial), M.iy 20 10,46
Atlantic Sugar Refineries, Ltd.,
February, 18 54
Bankruptcy Act, Action Under,
February, 25 42
Bell Telephone Co. of Canada, Jan-
uary, 14 59
Bell Telephone Company, Jariuary,
28 50
Bell Telephone Co. of Canada, April,
8 42
Bell Telephone Co. of Canada, April,
15 44
Bell Telephone Co. to Make Stock
Issue, May, 20 46
Black Lake Asbestos and Chrome
Co. Ltd., March, 4 46
Bond House, Operation of a (Edi-
torial), February, 18 10
Bond Sales, January, February, 11 24
Bond Sales, February, March, 11 . . 22
Bond Sales, March, April, 8 . . . . 14
Bond Sales, April, May, 13 22
Bond Sales, May, June, 24 7
Britain, Investment Relations With,
(Editorial), May, 13 9
British America Nickel Corp., April,
8 38
British America Nickel Company,
June, 24 7
British Columbia Telephone Com-
pany, April, 22 42
British Empire Steel Corp., Febru-
ary, 25 58
British Empire Steel Corporation,
New, April, 1 14
British Empire Steel Corporation,
April, 15- ; 42
British Empire Steel Corporation,
May, 27 50
Brompton Bonds Are Offered, May,
13 3S
Business Losses, Some Notable,
May, 27 10
Index
THE MONETARY TIMES
January 1 to June 30, 1921
PAGE
Business, Stock Markets and, April,
22 10
Canada Land and Irrigation
Company, March, 25 54
Canadian I'acitic Stock Takes Dras-
tic Slump, June 24 8
Canada Permanent Mortgage Cor-
poration to Merge, June, 'At . . . . 1
Canada Steamship Lines, Ltd., i
February, 25 54 '
Canada Steamship Lines, Ltd., /
April, 22 42 "
Canadian General Electric Changes,
April, 1 12
Canadian General Electric Would
Increase Common, April, 29 ... . 44
Canadian Pacific Financing (Edi-
torial), May, 13 9
Canadian Salt Company Bond
Offering, May, 6 38
Canadian Western Natural Gas,
Light, Heac & Power Co. Ltd.,
January, 21 62
Carriers, JJamage When Goods Lost
by, April 22 26
Clarke Bros. Bond Issue, March, 25 04
Commercial Securities Corp., Ltd.,
February, 18 20
Companies' Power to do Business,
Dominion, April, 8 5
Consumers Gas Stock Subscribed
for —
January, 14 54
January, 21 58
Consumers' Gas Company, January,
28 50
Corporation Finance, (See every
issue) .
Corporation Securities Market, ( See
every issue).
Corporations, Taxes on (Editorial),
June, 24 4
(3osgrave Brewery Co., Februarv,
18 54
Cosgrave Export Brewery Co.,
Februai-y, 25 54
Dfmaa-e When Goot'S Lost by
Can-iers, April, 22 26
Davidson Consolidated Gold Mines,
Ltd., January, 21 62
Dominion Companies' Powers to Do
Business, April, 8 5
Dominion Foundries and Stesl, Ltd.,
Febi-uary, 25 54
Equitable Securities, Ltd., Febru-
ary, 11 35
Express Companies' Substantial
Increase, February, 11 38
Felger Livestock and Grain, Ltd.,
(Editorial), February, 11 . . . . 10
Financing of Public Utilities, April,
8 22
Fort William Pulp Company Issues
Bonds, Febniary, 4 54
Eraser Companies Offer Securities,
March, 11 38
Goodyear Tire and Rubber Co. of
Canada, April, 15 42
Gordon Ironside and Fr.res Co., Ltd.,
January, 21 62
Gi'and Trunk Claim Against U. S.
Government, January, 14 42
Grand Trunk Maturities in Britain,
January, 28 46
Grand Trunk Railway Borrows in
United States, January, 21 ... . 58
Grand Trunk Retires Notes in Lon-
don, March, 18 50
Great West Garment Co. Bonds,
March, 25 54
Hamilton Car Co., Ltd., April, 15 42
Howard Smith Paper Mills Bonds,
March, 4 a26
Howard Smith Paper Mills Finan.
cing, February, 25 54
PACE
Howard Smith Pulp and Paper
Bonds, March, 11 38
Hudson's Bay Land Sales, Febru-
ary, 25 . . ; 38
Imperial lODacco Co. of Canada,
i" eoruary, 11 . 54
Insolvency, Voluntary Winding up
Does Not Constitute, February 18 42
International narve:=ier jo.ni own-
ership I'lan, (Editorial), Febru-
ai-y, iS 10
Investing in Oil, May, 20 zo
Investment Houses Ji,xpect Improv-
ea ouyjng. May, 6 12
Joint Ownership Plan, A (Editor-
ial), I'ebruary, 1« 10
Laurentide Power Bond Issue,
.rt-prji, b 3S
Lauientian I'ower isona urtering,
June, XI 3
Levis County Railway, March, ii . . i'A
i-iMutea IjiaoUity companies m the
Stock brokerage business (,Ji,di-
torial), April 1 .. 10
LiaoiJity ol atock iiJxchange xviem-
bers (Eaitoz-ial), April, 1 .. .. 10
Loan ana irust (_;ompany returns
to be Cliecked, June 24 1
Lo:;n Dy Company to &.iaieholdors.
Action on, j^eoruary, 11 42
Loan Companies la2u i'igures,
Ontai'io, March, 25 20
Loan Companies to iVlerge, June, 'Zi 1
London & Canadian Loan & Agency
Company to Merge, June 24 ... . 1
Mack Furnace Co., Ltd., April, 8 . . 38
Maritime Telegraph and telephone
Co. Bonds, January, 21 58
Morris tiros. !■ ailure (JJditorial),
Febi-uary, 18 10
Mortgage Companies of Ontario,
Land, March, 25 40
Mortgage Diecov.nt and Finance,
Ltd., (Editorial), March 11 . . . . 10
Mount Royal Hotel Company,
February, 4 54
Mount Royal Hotel Bond Offering,
February, 11 54
National Brick Company Will Re-
organize, May, 13 38
New Windsor Hotel Stock Offering,
April, 15 38
North America Pulp and Paper
Ti-ust, February, li 58
Oakoal Co. of Canada, Ltd., (Edi-
torial), April, 29 9
Oakoal Co. of Canada, Ltd., June,
24 3
Oil, Investing in, May, 20 28
Ontario Loan Companies 1920
Figures, March, 25 20
Pedlar People Bond Issue, March,
25 . 54
Preference Under Dominion Wind-
ing-up Act, May, 27 34
Pressed Metals Co. of Canada, June,
24 3
Prince's Ltd., Liabilities of, Janu-
ary, 21 6
Public Utilities, Financing of, April,
8 22
Pulp and Paper Financing, New-
March, 4 42
March 11 38
Purchasers, Sale of Goods to Joint,
March, 11 26
Railroad Earnings, Gross. (Sec
every issue).
Railroads Lost Money in 1919,
February, 25 ." 30
Railwavs and Operating Costs,
(Editorial), March, 18 10
Railway Problem Still Unsolved,
April, 29 8
PAGE
Railway Situation Considered in
Parliament, March, 25 7
Railways, The Difficulties of (Edi-
torial), March, 18 9
Railway Ti'affic, Co-ordination of,
April, 8 9
Realty Financing By Bond Issues
(Editorial), April, 29 10
Riordon Co., Ltd., May, 27 50
Riodon Company's Position Out-
lined, May, 13 12
Riordon Stock Adjustment, March,
18 50
Riordon Stock Takes Drastic Slump,
April 22 38
Rubber's Rise and Fall (Editorial),
April, 15 10
Sale of Goods co Joint Purchasers,
March, 11 26
Salj of Khares, Action to Stop, June,
24 9
Sale of Shares, Contract for, June,
17 2
Securities Market, Corporation.
(See every issue).
Shareholders, Action on Loan By
Company to, February, 11 ... . 42
Shareholders' Meeting, Power of
Manager to Call, April, 15 ... . 26
Shares, Action to Swp Sale of, June,
24 9
Shares, Contract for Sale of, June,
17 2
Shares, Double Payment of by
Mistake, March, 25 42
Shavrinigan Power Bonds Sold,
March 11 , 38
Smoot Service Corporation, Ltd.,
(Editorial), February 18 10
Spanish River Pulp and Paper Bond
Offering, February 11 54
Spanish River Pulp and Paper Co.,
March 18 50
Steel Corporation, New British
Empire, April 1 14
Stock. Dispute Over Subscription to,
January 21 46
Stock Exchanges, Montreal and
Toronto. (See every issue).
Stock Markets and Business (Edi-
torial), April 22 10
Stock Offerings Reach Good Total
in 1920, Public, January 14 ... . 38
Stock Sales and Prices. (See every
issue).
Stocks Depressed by Unfavorable
Statements, April 22 5
Tiger Tire and Rubber Corp., Feb-
ruary 25 54
Toronto Railway Companv, January
14 " 58
Trademark, Registration of General,
April 29 26
Trade Mark, Registration of. May
20 34
Unlisted Securities. (See every
issue).
Utilities, Financing of Public, April
8 22
Winding-up Act, Preferences Under
Dominion, May 27 34
Windsor Hotel Company, Januai-y
21 62
Winnipeg Electric Railway Com-
pany, Febi-uary 11 58
Winnipeg Electric Railway Earn-
ings, January 14 58
Winnipeg Electr'c Raihv-iv Still in
Rough Water, March 11 6
Winnipeg Electric Railway Stock
Sale, Januai-y 14 54
Woollings Company, T. S., May 27 36
January 1 to June oO, 1921
THE MONETARY TIMES
Index
PAGE
BANKING AND ECONOMICb
Aftermath, Banking Opportunities
and the, February 18 18
Alberta s lyiil Legislative Session,
June 24 5
Alberta Legislature in Session,
Maich25 31
American and Canadian Trust
(companies, xviay lo 20
American Interest in Canada, inay
Zl 18
Analysis of ±>usiness l-auures in
lyzu, March Zo 38
AsstSim-.nD and j^and Titles (Edi-
torial;, May 20 10
Assig^nment, iNotice of, January, 14 42
BanK Account and the Wills Act,
Joint, April 1 26
Bank Act, Amendments Proposed
(Editorial), June 24 .. .... .. 4
Bank Act, Section oa of the, April
15 22
Bank Branches, Four Hundred in a
Year, January 21 33
Bank Branches, Where They Are
Situated, January 21 33
Banking Capital, More Than Seven
Millions of New, January 14 ... . 5
Banking Capital, Premises Tie Up,
May 20 30
Bank Clearings. (See every issue).
Bank Credius, Distribution of
(Editorial), May 6 10
Bank Credits Must Be Short Term,
Why, May 27 22
Banking Opportunities and the
Aftermath, February 18 18
Banking Results in Scotland, (Edi-
torial), January 28 9
Bank Loans, Movement of, (Editor-
ial), February 25 10
Bank Manager, Broad Fields
Covered by, June 17 4
Bank, Operating a State (Editorial),
February 25 9
Bank Premises Holding Company
Suggested, May 20 28
Bankruptcy Act, Action Under,
February 25 42
Banki-uptcy Act in Operation, The,
January 14 26
Bankruptcy Act Still in Process,
February 4 8
Bank Services, Remuneration for,
March 18 22
Banks, Relations With Other, Feb-
ruary 11 32
Bank Statement, December, Febru-
ary 4 5
Bank Statement, January, March 4 5
Bank Statement, February, April 1 5
Bank Statement, March, May 6 . . 18
Bank's Stationery Department, A
(Editorial), April 8 10
Banks vs. Life Insurance, March 18 32
Banque d'Hochelaga Held Liable,
February 18 42
Bills of Exchange Act, Effect of
Section 167 of, January 28 ... . 34
Boards of Trade Review Year's
Work, February 4 18
Bonusing Industry, Municipalities
Suffer by (Editorial), May 6 .. 10
Britain, Investment Relations With
(Editorial), May 13 9
British ColumBia Legislative Ses-
sion, April \b 18
British Columbia Legislature Now
in Session, March 11 5
Building Activity at the Coast,
Some, May 6 7
Building Activity, Land Values and
(Editorial), April 15 10
Building, The Rewards and Costs of
(Editorial), January 28 10
PAGE
Business and Pergonal Connection
March 4 lo
Business and Stock Markets (Edi-
torial), AprU 22 10
Business, Dominion Companies'
Power to uo, April 8 5
Business Enterprise Deserves Fos-
tering, the bpirit, teoruary 11 36
Business P'ailures in 1920, Analysis
of, March Z5 38
Business Failures. (See every
issue).
Business Failures, A "Crop" of,
April 29 22
Business, How it Should Be Taxed?
(Editorial), April Z\i 10
Business Losses, borne Notable
(Editorial), May z7 lU
Canada, American Interest in, May
zt 18
Canada and South Africa (Editor-
ial), May 2u y
Canada and the Imperial Navy,
April 29 5
Canada and the Reparation Terms
(Editorial), li ebruary 4 9
Canada, International Ti'ade Situ-
ation in, May 27 7
Canadian Trust Companies, Amer-
ican and, May 13 20
Cancellation of Business, Too Much,
(Editorial), January 14 10
Capital and Immigration, Attracting
(Editorial), June 17 4
Capital, More than Seven Millions
of New Banking, January 14 . . 5
Census, What Will the 1921 Reveal?
April 29 18
Charitable Appeals, Duplicating
(Editorial), March 25 10
Coast, Building Activity at the. May
6 7
Copyright, Infringement of. May 6 26
Co-operative Marketing of Grain,
March 4 18
Creditor Against Estate, Action of,
March 18 38
Credits Must Be Short Term, Why
Bank, May 27 22
Credits, Short and Long Term
Rural, April 22 14
Crime, Finance and (Editorial),
March 18 lo
Currency Inflation, Our (Editorial),
February 25 9
Debtor, Conveyance of Property by,
April 8 26
Deflation in the United States
(Editorial), March 11 10
Deposit. Agent Fraudulently With-
drawing, May 20 34
Depositaries for Public Savings
(Editorial), February 4 9
Deposit Limitations of Loan and
Trust Companies, February 4 . . 14
Dollar, Our Good Canadian, (Edi-
torial), April 15 9
Dominion Control of Water-Powers,
May 27 14
Domin-on Moi-tgage and Investment
Association Meets, May 13 ... . 8
Dominion Mortgage and "investment
As-ociati n. May 20 5
Earning Capacity of the Average
Man, April 15 16
Economic Developments in Western
Canada. January 21 37
Electric Railway Association, Can-
adian, February 11 d32
Employee. Personal Connection
With (Editorial), March 4 .. .. 10
Enterprise Deserves Fostering, The
Spirit of, February 11 36
Estate. Action of Creditor Against,
March 18 38
_ PAGE
Estate, Administration of. May 13 z6
Exchange Act, Effect of Section 167
of Bills of, January 28 34
Exchange in Relation m the Secur-
ities Market (Editorial), January
21 9
Exchange Problem, An Aspect of
the, March 18 36
Exchange Quotations. (See every
issue).
Exchange Rates, Intrincacies of,
February 4 24
Exchange, Rise in, January 14 . . 38
Failures, A Crop of Business, April
29 22
Failures, Business. (See every
issue).
Failures in 1920, Analysis of,
March 25 38
Failures in Canada in 1920, Com-
mercial, January 14 24
Failures, Speculation and (Editor-
ial), January 28 10
Farmers' Movement is Economic,
Organized, February 18 34
Federal Charter Over-Rides Provin-
cial Laws, March 4 30
Finance and Crime (Editorial),
March 18 lo
Finances Must be Sound, Industries'
(Editorial), January 21 10
Financial Bills Before Parliament,
March 4 14
Financial Business Dull in the
Capital, April 29 14
Financial Relations with the United
States, January 14 18
Financing in Great Britain, Long-
Term (Edtiorial), January 21 . . 10
Fordney Tariff Measure, The (Edi-
torial), February 18 9
Forewarnings for 1921 (Editorial),
January 14 9
Foreign Exchange and the Security
Market. (Editorial), January 21 9
Foreign Trade Machinery is Deli-
cate, May 13 18
FraudulenHv Withdrawing Deposit,
Agent, May 20 34 ■
German Indemnity, The (Editorial),
March 4 9
Gold and Silver Production, April
22 36
Gold Movement from Canada (Edi-
torial) , January 14 9
Grain Broker to Recover Losses,
Right of, January 28 34
Grain, Co-operative Marketing of,
March 4 18
Great Britain, Long-Term Financ-
ing in (Editorial), January 21 .. 10
Great Britain Will Soon be in
World's Markets Again, April 29 28
Great West Bank of Canada, The
(Editorial), March 4 9
Home Bank Loses Cahan Case,
Februai-y 25 18
Housing Loan, Proposes Huge
Government, Febi-uary 25 ... . 36
Immigration and Industry (Editor-
ial), March 25 9
Immigration and Unemployment,
May 20 20
Immigration, Attracting Capital
and (Editorial), June 17 4
Immigration Increasing, March 4 . . 7
Immigi-ation Still Increases, March
18 24
Impei-ial Navy, Canada and the,
April 29 ?,
Income Tax, Intricacies of the,
April 15 36
Income Tax Payments, (Editorial),
May 6 9
Index
THE MONETARY TIMES
January 1 to June 30, 1921
PACE
Indemnity, The German (Editorial),
Marcli 4 9
Inoustnes' l-'mances Must be Sound
(Editorial), January ^1 . . . . . . 10
Industry, iiunugration and (Editor-
ial), March 25 9
Inrtavion, Our Currency (Editorial),
February 25 9
Insolvency, Voluntary Winding-up
Does i.ot Constitute, Februai-y IS 42
International Trade Situation in
Canada, May 27 7
Investing in Oil, May 20 28
Investments Association, Dominion
Mortgage, May 20 5
Issues for Coming Session, Broad
(Editorial), February 11 9
Joint Bank Account and the Wills
Act, April 1 26
Joint Ownership Plan, A (Editor-
ial), l<ebiuary 18 ,. . • • 10
Labor Organization and the
Kadicals vHiditoriai), May 13 . . 10
Labor Situation in Relation to
i-rices and ri-ofiis (i.ditorial),
January 21 9
Labor, What it Wants ? January 21 41
l^and Mortgage Companies of Ont-
ario, Marcn 25 40
Land Titles, Assessment and ^Edi;
torial), May 20 10
Land Values and Building Activity
(Editorial), April 15 10
Land Values Increased, Average,
March 25 32
Legislation, The Progress of Social
(Editorial), February 11 . . . . 9
Loan and Trust Assets to be Fully
Examined, January 14 7
Loan Companies 1920 Figures,
Ontario, March 25 20
Loan Companies, Consider Borrow-
ing Powers of, January 28 ... . 7
Loans, Movement of Bank (Editor-
ial) , February 25 10
Long-Tenn Financing in Great
Britain (Editorial), January 21 10
Manitoba Legislative Session,
March 11 18
Manitoba Legislative Session, May
27 -. • 8
Manitoba Legislature Now in
Session, February 11 6
Merchants Bank Makes Foreign
Connection, April 22 8
Money Conditions in the West,
Easier, February 25 7
Montreal and Quebec Savings Insti-
tutions, Febi-uary 4 24
Montreal and Quebec Savings Insti-
tutions, January Statement,
March 4 22
Montreal and Quebec Savings Insti-
tutions in February, April 1 . . . . 24
Montreal and Quebec Savings
Institutions, May 13 24
Montreal Banks are Swindled,
March 11 .• ■ 20
^Mortgage and Investment Associa-
tion, Dominion, May 13 ..... . 8
Mortgage and Investments Associa-
tion, Dominion, May 20 5
Mortgage 3nd trusts Association,
B. C, January 14 d32
National Debts, Something about
(Editorial), April 8 10
National Disappointment, A (Edi-
torial), February 4 10
Nfit-onal Problems Remain Unsolv-
ed, June 24 , 1
New Brunswick Legislative Session,
April 15 ^ 20
New Brunswick Legislative Session,
May Ci 24
PAGE
New Brunswick Will Practice
ji,conomy, April 22 18
Note lo iiank, Payment, of, April S 26
Nova Scotia Legislative Session,
April 15 41
Ontario's 1921 Legislation to be
Comprehensive, J; eOruary 25 . . 5
Ontai-ios Legislation in 192i Covers
Broad t leld. May 20 18
Organized Farmers' Movement is
Economic, February 18 34
Ownership Plan, Joint (Editorial),
a ebruary 18 ; 10
Parliamentary Session lor 1921,
(iLditonal), May Z( _ 10
Parliamentary beoSion, Kcsult of
uominion, june 24 1
Parliamentary Session to Close May
28, May 27 5
Parliament, Broad Issues for Domin-
ion (iiiditorial), t'eoruary 11 . . 9
Parliament, J^inancial rSiUs Beiore,
March 4 14
Parliament Opens With Political
Battle, February 18 7
Parliament Ready for Opening on
Monday, February 11 . . . . -. . . . 7
Parliament, 'ihe Outlook at Ottawa
(Editorial), February 18 9
Personal Connection in Business
(Editorial), March 4 ......... 10
Premises Tie up lianking Capital,
May 20 : 28
Prices Changing With Phenominal
Rapidity, January 28 18
Prince Edward Island Legislative
Session, April 15 24
Prince Edward Island Legislative
Session, May 13 14
Profits and rrices in Relation to
Labor (Editorial), January 21 . . 9
Progress of Trust Companies, March
25 . . • . . • • 40
Property by Debtor, Conveyance of,
April 8 26
Protective Tariff, A National Dis-
appointment (Editoi-ial), Febru-
ary 4 10
Provincial Laws, Federal Charter
Over-Rides, March 4 30
Quebec Legislative Session, Work of
the, February 25 26
Quebec Parliamentary Session,
Municipal Legislation Featured,
April 1 18
Radicals, Labor Organization and
tne (Editorial), May 13 10
Railway Problem, Shaughnessy
Proposal, April 29 8
Railway Traffic, Co-ordination of,
April 8 9
Relations With Other Banks,
Februai-y 11 32
Relations With the United States,
Financial, January 14 18
Remuneration for Bank Services,
March 18 22
Reparation Terms, Canada and the
(Editorial), February 4 9
Retailers Now Taking Losses (Edi-
torial), May 20 9
Rural Credits, Short and Long
Term, April 22 14
Sav-ng3, Depositaries for Public
(Editorial), February 4 9
S!>vine's P-'nks. Dominion Govern-
ment, February 11 32
Scotland, Banking Results in (Edi-
torial), January 28 9
Section 88 of the Bank Act, April 15 22
Securities Embargo Lifted, January
21 54, 8
Securities Market, Foreign Ex-
change in Relation to (Editorial),
January 21 9
PAC.Ji
Signature, The Legible (Editorial),
ii'ebruary 25 10
Sliver Price Fell Rapidly in 1920,
Feoruary 4 32
Silver Production, World s Gold and,
April 22 36
Social Legislation, The Progress of
(Editorial), February 11 . . . . 9
South Africa, Canada and (Editor-
ial), May 20 9
Speculation and Failures ^ Editor-
ial), January 2» 10
Stati,- Bank, operating a (Editor-
ial), Februai-y 25 9
Stationery Department, A Bank's
(Editorial), April s 10
Stock Markets and Business (Edi-
torial), April 22 10
Succession Duty, Assessment for,
May 27 34
Tariff Measure, The Fordney (Edi-
torial), l-eDruary 18 9
Taritt Policy, The Republican (Edi-
torial), March 25 10
Tariff, Protec<,ive, A National
Disappointment (.Editorial), Feb-
ruary 4 10
Taxation Now Being Tested, War-
time, March 25 5
Taxed, now Jbusiness Should Be ?
- (Editorial), April 29 10
Taxes on Corporations (Editorial),
June 24 4
Tax on Sales, Turnover Tax and an
E.xtended, May 6 5
Trade Mai'ks, Concurrent Use of,
February 4 42
Trusts Assets to be Fully Examined,
Loan and, January 14 7
Trust Companies, American and
Canadian, May 13 20
Trust Companies, Deposit Limit of
Loan and, December 4 14
Trust Companies, The Progress of,
March 25 ... 40
Trust Company Notes, April 29 . . 14
Trust Compa'ny Returns to be
Checked, Loan and, June 24 ... . 1
Trust Moneys in Deceased's Hands,
Priority of, June 24 6
Turnover Tax and an Extended Tax
on Sales, May 6 5
Turnover Tax, The Proposed,
(Editorial), April 1 9
Turrfover Tax Not Desirable (Edi-
torial), May 6 9
Unemployment, Immigration and,
May 20 20
Unemployment Situation in Canada,
March"ll 14
United States, Financial Relations
wth the, January 14 18
Voluntary Winding-up Does Not
Constitute Insolvency, February
18 42
Waterpowers, Dominion Control of,
May 27 14
Weather, A Gamble on the (Editor-
ial), April 22 10
West, Easier Money Conditions in
the, February 25 ,7
Western Canada, Economic Devel-
opments in, January 21 37
Wheat Pool, The, March 25 18
Wheat Touches Dollar Mark (Edi-
torial), April 29 10
Wholesale Prices, Index Number
of—
January 21 24
February 25 24
March 25 14
April 29 24
May 27 24
Juiie 24 10
Index
THE MONETARY TIMES
January 1 to June 30, 1921
PAGE
Wills Act, Joint Bank Account and
the, April 1 26
Withdrawing.- Deposit, Agent Fraud-
ulently, May 20 34
ANNUAL REPORTS
Banks
Bank of Hamilton, March 25 . . 8
Bank of Hamilton, April 1 . . . . 43
Bankof Hockolaga, January21, 14, 25
Bank of Montreal ( Semi- Annual ) ,
May 27 25, 52
Bank of Nova Scotia, January
28 27, 51
Bank of Toronto, Januai-y 14 . .14, 34
Banque Nationale, June 24 .. ..11, 12
Canadian Bank of Commerce,
January 14 . .27, d32
Dominion Bank, January 28 ..14, 28
Imperial Bank of Canada, May
27 16, 26
Lloyds Bank Limited. May 20 . . 49
Merchants Bank of Canada, June
17 8, 9
Montreal City and District Sav-
ing's Bank, February 25 . . ..14, 33
Roval Bank of Canada, January
21 12, 39
Standard Bank of Canada, Febru-
ary 18 8, 57
Sterling Bank of Canada, May
20 8, 51
Union Bank of Canada, January
21 8, 27
Weyburn Security Bank, April 1 41
Insurance
Acadia Fire Insurance Company,
May 13 30
Aetna Life Insurance Company,
March 11 12, c24
British America Assurance Com-
pany, March 25 16, 25
British Northwestern Fire Insur-
ance Co., March 4 26
Caledonian Insurance Company,
June 17 12
Canada Life Assurance Company,
January 14 8, e32
Canada National Fire Insurance
Company, February 18 .. ..28, 52
Canadian Fire Insurance Com-
panv, March 4 26
Canadian Suretv Company, March
4 ■ d26
Casualty Co. of Canada, March 18 56
Confederation Life Association,
January 28 27
Commercial Life Assurance Com-
pany, March 18 25, 48
Continental Life Insurance Com-
pany, February 11 57
Crowri Life Insurance Company,
Februarv 11 d32
Dominion Fire Insurance Co.,
March 18 12, 33
Dominion Life Assurance Com-
pany, February 11 25, 57
Employers' Liability Assurance
Report, June 17 1
Excelsior Life Assurance Co.,
February 4 37
Farmers' Mutual Insurance Com-
panies, March 4 28
Fire Insurance Company of Can-
ada, April 1 39
Glens Falls Insurance Company,
May 13 6
Great West Life Assurance Com-
pany, February 14 19, 36
Guarantee Company of Nortli
America. February 25 .. ._. .. 14
Imperial Guarantee and Accident
Company, Januar-y 21 33
Imperial Life Assurance Com-
pany, January 14 8
PAGE
La Sauve^arde Life Insurance
Company, April 29 20
Liverpool and London ana GloDe
Insurance Co., June 17 11
London Life Insurance Company,
February 18 30
London Life Assurance Company,
February 25 28
London Mutual Fire Insurance,
Company, February 25 .. ..29,32
Manitoba', Farmers' Mutual Hail
Insurance Co., February 11 ..12, 25
Manufacturers' Life Assurance
Company, February 4 .. . .12, 27
Milk River Mutual Fire Insurance
Company, February 25 36
Miniota Farmers' Mutual Fii-e
Insurance Co., April 29 26
Merchants Fire Insurance Com-
pany January 14 14, f32
Monarch Fire Insniance Co.,
March 4 26
Monarch Life Assurance Com-
pany, February 4 12, 33
Mount Royal Assurance Company,
Marcn 11 41
Mount Roval Assurance Company,
March 18 29
Mutual Life Assurance Co. of
Canada, Febniary 4 31, 52
Mutual Life Insurance Co. of New
York, February 4 36
National Life Assurance Com-
pany, J.inuary 21 35, 61
New York Life Insurance Com-
pany, February 25 30
North American Life Assurance
Company, January 28 . . . . 8, 25
Northwestern Life Assurance
Company, February 25 . . . . 8, 59
North W^est Fire Insurance Co.,
Ltd.. February 18 27, .52
Ornide"taI Fire Insurance Co.,
March 4 8, 28
Ontario Equitable life and Acci-
dent Insurance Co., Februarv
18 12, 59
Policy-Holders Mutual T.ife Insur-
ance Co.. February 25 30
Portage La Prairie Farmers'
Mutal Fire Insurance Co.. Feb-
ruary 4 . . 33
Port-^i-e La Prairie Farmers'
Mutual Fire Insurance Co.,
February 11 57
Provident Insurance Company,
Anril 1 41, 21
Prudential Insurance Company,
February 25 32
Saskatchewan Fprn-ers' Mutual
Fire Insurance Co., March 18.16, 51
Security Life Insurance Company,
Februarv 11 12. c32
Sovereipn Life Assurance Co. of
Canada, February 11 27,40
St. John's Mutual Life Associa-
tion, February 18 36
St. Paul Fire and Marine Insur--
ance Co., February 4 12, 27
Sun Life Assurance Company.
February 11 d32, .59
Travellers Companies of Hartford,
April 8 36
Treatv Reinsurances, Ltd., March
18 '. 40
Union Fire and Casualty Com-
pany, Febniai-y 25 12,27
Wawanesa Mutual Insurance
Company, February 25 .. ..16, 27
Western Assurance Company,
March 25 27, 16
Western Empire Life Assurance
Co., February 4 37,52
Western Life Assurance Com-
pany, February 18 32, 59
PAGB
Trust and Loan
British Columbia Permanent Loan
Co., February 18 32
British Columbia Permanent Loan
Co., February 25 39
Canada Permanent Mortgage
Corporation, February 4 ..28,37
Canadian Guaranty Trust Com-
pany, February 11 8, a32
Canadian Mortgace Investment
Company, February 11 40
Canadian Northwest Land Com-
pany, Ltd., April 1 42
Capital Trust Company, February
11 40
Central Canada Loan and Savings
Company, January 28 14
Chartered Trust and Executor
Co., March 4 d26
Colonial Investment and Loan Co..
February 25 24
Crown Trust Company, February
25 16
Eastern Canada Savings and
Loan Company, February 18 . . 33
Eastern Trust Company, March
11 32
Equitable Trust Company, of
Winnipeg, February 25 .. .24, 35
Guaranty 'Trust Company of New
York, January 14 40
HanJlton Provident and Loan
Corporation, February 18 ... . 24
Hamilton Provident and Loan
Corporation. March 4 ..... . 25
Home Investment and Savings
Association. February 11 . . 8, 28
Huron and Erie Mortgage Cor-
poration. February 11 . . . . 8, 29
Imnerial Trusts Company "f
Canada. February 25 24
International Loan Company,
April 22 22
Lambtnn Loan and Investment
Co. Fph'-uary25 57
Landed Banking and Loan Com-
pany, January 28 14
London and Canadian Loan
Agency Comuany. February 11 8
London and Canadian Loan and
Agency Co. Ltd., Februai-y 18 37
London and Wester" Trusts Com-
. uanv, 'P'e'^ruarv 18 3^"
Lond-n Loan and Savings Co..
February' 25 5"
Mercantil'* Trust Company, Feb-
ruarv 18 32
Mercantile T>-ust Company of
Canada. Februarv 25 25
Midland Loan and Savingrs Com-
pany. January 21 65
Montreal Loan and Mortga2:e Co.,
Februarv 25 57
Montreal Trust Company, Janu-
ary 28 24
Mortgage Corporation of Nova
Scotia, Februai-y 25 57
National Trust Company, Januaiy
28 • ■ 27
National Trust Company, Ltd.,
Februarv 4 58, 59, 60
Northern Mortgage Co. of Cana-
da, March 4 • • 28
Northern Trusts Company, Feb-
ruary 11 40
North of Scotland Canadian
Mortgao-p Co. Ltd., Februarj'25 34
Nova "Scotia Trust Company,
April 22 8
Ontario Loan .and Debenture Co..
February 11 h32, 57
Peoples' Loan and Saving Com-
pany, Februarv 18 32
Premier Tnist Company, Febiit-
ary 18 32
January 1 to June 30, 1921
THE MONETARY TIMES
Index
PACK
Prudential Trust Company, March
25 6
Real Estate Loan Company of
Canada, Ltd., February 18 ..27, 52
Royal Loan and Savings Company,
February 11 d32
Saskatchewan Mortgage and
Trust Co., February 25 ... . 28
Security Loan and Savings Com-
pany, February 25 34
Security Loan and Savings Com-
pany, March 18 14
Standard Trusts Company, Janu-
ary 28 8, 2o
Sterling Trusts Corporation,
March 4 d23
Toronto General Tntsts Corpor-
ation, January 21 61
Toronto General Trusts Corpo:-
ation, February 1 34
Toronto Mortj^age Company,
January" 21 38
Toronto Mortg-age Company, Jan-
uary 21 38
Toronto Mortgage Co'-ipany, Feb-
ruary 1 1 . . .^ 37
Toronto Savines and Loan Com-
pany, March IS 14
Trust and Loan Company of
Canada, June 17 12
Trustee Company of Winnipeg,
April 22 . . . ! 7
Trust'; and Guarantee Company.
February 11 8, 33
Union Trust Company, February
18 * 12, 25
Waterloo County Loan and Sav-
ings Company, Febnjary 25.. 8, 37
Western Canada Investment
Companv, Ltd.. February 11 . . 40
Western Homes, Ltd., January 21 61
Industrial
Abitibi Power and Paper Co.,
April 1 44
American Salesbook Co., February
25 58
American Salesbook Co., March 4 47
Ames-Holden-McCready, Ltd.,
April 1 44
Ames-Holden Tire and Felt Cos.,
April 8 42
Belding, Paul Corticelli, Ltd.,
February 4 57
Brandram-HendersOn, Ltd., April
29 24, 42
British Columbia Fishing and
Packing' Co., March 4 45
Brompton Pulp and Paper Com-
pany, Jannai-y 28 50
Burt Company. F. N. February 4 57
Burt Co., Ltd.,F. N.—
February 18 . 35
February 25 58
Canada Cement Company, Febru-
ary 18 58, 33
Canadian Consolidated Felt, Co.,
May 6 42
Canadian Consolidated Rubber
Co.. Ltd.. April 29 38
Canadian Cotton?, Ltd., May 13 42
Canadian Fairbanks-Morse Co.,
Ltd., April 29 38
Canadian General Electric Co.,
Ltd., March 25 34, 59
Can.adian Westinghonse, Ltd.,
April 1 42
City Dairy Co., Ltd., March 11 - . 42
Dominion Bridge Co., Ltd.,
January 14 58
Dominion Canners, Ltd.. March 11 42
Dominion Engineering Works,
Ltd.. March 25 59
Dominion Linens, Ltd., .A.pril 1 . . 42
Goodwin-^, Ltd., .\pril 8 42
PAGE
Goodyear Tire and Rubber Com-
pany of Canada, February 11 58
Holt i<entrew Co., Ltd., April 1 42
Howara Smith Paper Mills, Ltd.,
February 25 40
King Edward Hotel Co., Ltd.,
March 4 43, 45
Mattagami Pulp and Paper Co.,
Ltd., May 20 50
Monarch knitting Co., Ltd., April
29 38
Montreal Cottons, Ltd., March 4 45
National Breweries Co., Ltd.,
March 25 : . . . . 58
Nova bcotia Steel and Coal Co.,
Ltd., March 13 43
Nova Scotia Steel and Coal Com-
pany, March 18 34
Penman's Ltd., March 11 42
Port Hope Sanitary Manufactur-
ing Company, March 25 ... . 58
Price Bros, and Company, Ltd.,
May 20 50
Provincial Paper Mills, Ltd.,
February 18 40
Provincial Paper Mills, Ltd.,
February 25 31
Quaker Oats Company, March 25 58
Riordon Co., Ltd., April 1 . . . . 42
Rogers Co., Ltd., Wm. A., Febru-
ary 11 58
Rogers, Ltd., Wra. A., February
18 33
Saguenay Pulp and Power Co.,
March 18 56
Sawyer-Massey Co., Ltd., March
18 54
Shredded Wheat Company, Feb-
ruary 25 40
Simpson Co., Ltd., Robt., March
18 54
Steel Companv of Canada, Ltd.,
April 8 44
St. Maurice Paper Co., Ltd., April
8 44
Tuckett Tobacco Companv, Ltd.,
May 27 ." 50
We.stern Grocers, Ltd., April 8 . . 42
Winn'peg- Paint and Glass Co.,
June 24 3
Woods Manufacturing Co., Ltd.,
February 18 40
Utilities
Barcelona Traction, Light and
Power Co., January 14 58
Barcelona Traction, Light and
Power Co.. January 21 63
Bell Telephone Company of
Canada March 4 ". ..27, 47
British Columbia Electric Rail-
way, February 11 34, 58
Canada Steamshin Lines, Ltd.,
May 13 42
Canadian Pacific Railvray Com-
panv, February 4 57
Canadian Pacific Railway Co.,
March 25 ." . . . . 58
Canadian Pacific Railway Com.-
pany, Mnv 6 .' 42
Demerara Electric Co., Ltd., Anril
15 42
Detroit United Railv;ay. Ar>ril 15 42
Dominion Power and Trans-
mission Co.. February 25 . . . 40
Laurentide Power Co., Ltd., Feb-
ruary 18 ''O
Mackay Companies, Februarv 18 58
Maritime Telea-raph and Tele-
phone Co . F°>iruary IS ... . 58
Mexican Liaht, Power and Tram-
wav C'O. June 24 3
Minneapolis, St Paul and Sault
Ste. Marie Railwav, June 24 . . 3
Montreal Light, Heat and Power
Company, January 28 50
PAGE
Montreal Telegraph Company,
January 21 62
New Brunswick Telephone Co.,
February 25 40
Niagara Falls Power Co., March
25 59
Northern Ontario Light and
Po.ver Company, March 25 . . 58
Nova Scotia Tramway ,-ind t^ower
Co., May 6 42
Ottawa Light, Heat and Power
Co., Ltd., March 11 41
Porto Kico Railways Co., i^id.,
March 18 54
Public Service Corporation oi
Quebec, February 18 40
Shawinig-an Water and Power
Company, February 25 40
Temiskaming and Northern Ont-
ario Railway, January Zi. . . . . 61
Trinidad Electric Co., Ltd.,
April 15 42
West India Eleocric Co., Ltd.,
March 25 59
Winnipeg Electric Railway Co.,
Februai-y 18 40
Winnipeg Electric Railway Com-
pany, February 25 22
Mining
Asbestos Corporation of Canada,
March ,4 4.5
Black Lake Asbestos and Chrome
Co., Ltd., March 4 46
Canadian Salt Co., March 18 . . 54
Consolidated Mining and Smeltijig
Company of Canada, Ltd.,
April 15 4.3
Crow's Nest Pass Coal Co., June
24 3
Dome Mines Co., Ltd., May 27 . . 50
Granby Consolidated Mining and
Smelting Co., May 20 50
Hillcrest Collieries, Ltd., March
11 42
Holhnger Consolidated Gold
Mines, Ltd., February 25 ... . 58
Intercolonial Coal Mining Co.,
Ltd., March 11 42
Nipissing Mines Co., Ltd., April 29 38
" GOVERNMENT AND MUNICIPAL
FINANCE
Advances to Great Britain by
Canada, April 22 7
Albeita Budget and Surplus, March
^•5 36
Alberta Municipal Assessments too
High, April 22 20
-A.lberta Sells Securities, January 21 56
Alberta's Municipal Hospital Sys-
tem, April 1 24
Athabasca and its Financial Diifi-
culties, March 25 48
.\thabasca in Financial Troubles,
March IS 44
Bond Dealers' Association Conven-
tion, June 17 . 1
Bond House, Operation of a (Edi-
torial ) , February 18 13
Bond Market for 1921, Review of
the, January 21 36
Bond Market. Government and
Municipal (See every issue).
Bond Sales, January, February 11 24
Pond Sales, February, March 11 . . 22
Bond Sal°F, March, April 8 14
Bond Sales, April, May 13 22
Bend Sales, May, June 24 7
Borrowing in the United States,
Canadian, January 21 54
Borrowing Power of a Municipality,
How it is Arrived at. April 8 . . 32
Brantford 1920 Finances, May 27 .. 38
Index
THE I\IONETARY TIMES
January 1 to June 30. 1921
PAGE
Britain, Iiivestnient Relation* with,
(Editorial), May 13 9
British Columbia liond Sale, March
25 . . . . 52
Briiish Columbia Bond Sale, April
29 36
British Columbia budg-et, April 1 .. Zld
British Columbia Reports Revenue
Surplus, March 18 3-
British Columbia Sells Bond Issue,
June 17 r • ■ 6
Budget, A Discreet (Editonal),
May 13 • • 9
Budget! for 1921-22, Dominions,
May 13 • ^
Budg-ets, Careless Handling of
Municipal, June 17 11
Bumaby s Financial Position In.-
proves, May 6 32
Bumaby's Fihancial Statement,
April 29 42
Calgary and Tax Sale Property,
January 21 52
Calgary Collections and Arrears,
February 4 48
Calp-aiT Collections Improved, April
8 32
Calgary Tax Collections, January
21 52
Calgary Can Save Money by Depos-
iting with Province, January 28 40
Calgary Will Pay Sterling Deben-
tures, January 28 42
Cal"-ary S'.nking Fund Behind in
Paym.mts, April 22 32
Canora Pays Interest Arrears,
February 11 48
Cities, Financial Condition of Lead-
ing Canadian, February 25 ... . 18
Crown Lards, The future of, AnrU
29 20
Debenture Indebtedness and Relig-
ion, March 25 42
Debts, Something About National
(Editorir.1), April 8 10
Defaulting Municipalities, (Letter
to Editor), March 18 S
Defaulting Municipalities, Aid to
April 15 32
Defaults have been Common, Inter-
national (Editorial), April 22 . . 10
Dffaults, The Crop of Municiwal
(Editorial), March 11 '. . 9
Deposit Limit of Loan and Trust
Companies, February 4 14
Dominion Estimates are Tabled in
CJommons, March 11 7
Dominion Finances in December,
January 21 24
Dominion Finances in January,
February 18 22
Dominion Finances in February,
March 18 24
Dc minion Finance in March, April
15 24
Drmmion Government May BoriV-w
in New York, May 13 34
Dorunion Mortga<rc and Investment
Assoehiation, May 13 8
Dominion Morte'apre and Invest-
ments Association, May 20 ... . 5
Dominion Revenue, Source of, Feb-
ruary 25 32
Dominion's Budge*: for 1921-22,
May 13 5
Edmonton Apsessment, March 4 . . 36
Edmonton Bond Deal Arran-jed,
Marcch 4 40
Er'"'""toTi Bond Deal Concluded,
M-'vch IS 46
Edmonton Bond Tie-up Embarrass-
ing. January 21 56
Edmonton's Bond Tie-up. February
18 50
Edmonton Negotiates for Sale of
Bonds, May 20 44
PAGE
Edmonton Seeking to Tax Rents,
J^'eoruary 11 48
Edmonton's iiudget f.nd Tax Rate,
May 13 32
Eamonton's Financial Position
Strengthened, May 27 8
Edmonioii s lyzO 1 inances. May 20 40
Et'monCon's L(<ss on Bond Deal,
March 25 48
Estimates ire Tabled in Parliament,
March 11 7
Fernie, B.C., has Good Report, April
29 34
i inancial Condition of Ler.ding
Canadian Cities, February 25 . . 18
Pinancing in the West Proved
Disappointment, Local, February
4 22
Government and Municipal Bond
Market. (See every issue)
Government Housing Lotn, Pre poses
Huge, February 25 ... . 36
Great Bi-itain, Advances co, by
Canada, April 22 7
Great Britain's Financial Outlook
(Editorial), May 27 9
HaUeybury Defaults on Bond
Interest, February 11 48
Halifax Assessment Exemptions,
March 11 32
Housin;- Loan Proposes Huge Gov-
ernment, February 25 36
Imperial Navy, Should Canada
Share in the Cost, April 29 ... . 5
Income Tax Effects in Ontario,
March 25 48
Income Tax, Intricacies of the, April
15 36
Income Tax, Life Insurance and the
(Editorial), May 20 10
Income Tax Payments (Editorial),
May 6 3
Interest in New York Funds,
Collecting, April 22 26
Interest Rates on the Downward
Trend, Bond, February 11.... 50
International Dffaults have been
Common (Editorial), April 22 .. 10
Investment Houses Expect Improv-
ed Buying, May € 12
Investments Association, Dominion
Mortgage, May 20 5
Irrigation Bonds, February 25 ... . 50
Irrigation Bonds not Sold, January
14 50
Lethbridgf Northern Irrigation-
Bond Issve, May 27 44
Lethbridgc Northern Irrigation
Bonds, February ?5 50
Lethbridgc Northern Irriga'fon
Bonds, April 1 34
Loan anf' Trust Companies, Deposit
Limit of, February 4 14
T.oici Roiid Selling, February 4 . . 50
Local Fin Jincing Proved Disappoint-
ment, February 4 22
Manitoba Bonds Sold in New York,
March 11 36
Manitoba Budjret, March 25 8
Manitoba may Tax Incorporated
Companies, March 18 8
Manitoba Sells Securities, January
14 52
Mpn'to'ia Sells Two Bond Issues,
May 27 . . . . . . . . 44
Manitoba's Si'.i-plus, May IS 14
Manitoba Telephones Deficit, Janu-
ary 28 S
Mellville Bondholders Impose Severe
Term?. Anril29 ... 32
Merchants Marino Res^ilts in 1920,
April 1 .-.• TT . . . . . • S
Montreal and tli-? .Annexation Prob-
lem, February 4 48
Montreal Finances in 1920, June 24 10
PAGE
Mintrcal "Mi-tropolitan" Commis-
sion Controversy, January 21 . 52
Mcntreal "Metropolitan" Comm's-
sion. Powers of, Januai-y 14 . . . 48
Montreal Metropolitan i,ommission,
April 8 32
Moose Jaw Assessment, i'eoruary
18 48
Moose Jaw's Borrowing Power,
April 8 32
.Morrii Bros. Failure (Editorial),
February 18 10
.Mortgage and Investment Associa-
tion Meets, Dominion, May 13 . . S
Mortgage and Investments Associa-
tion, Dominion, May 20 5
Mortgage on Laml Exdng-uished by
Tax Sale, April 29 26
Municipal Accounting and Munici-
pal Finance, March 18 18
Municinal Assessments, Alberta too
High, April 22 20
Municipal A?sociation, Sasl-.atche-
wan Rural, March 25 14
Municipal Bond Market, Govern-
ment and. (See every issue).
Municipal Budgets, Careless Hand-
ling of, June 17 11
Municipal l>erauhs. Crop of, (Edi-
torial), March 11 9
Municipal Defaults in Saskatche-
wan, April 1 . . . 32
Municipal Defaults, Proce lure with,
June 17 5
Municipal Exemptions Prove
Burdensome, June 24 5
Municipal Finance. (See every
issue) .
Municipal Hospital System in
Alberta, April 1 24
Municipalities, Aid to Defaulting,
April 15 32
Municipalities, Defaulting (Letter
to Editor), March 18 »
Municipalities' Difficulties (Editor-
ial), June 24 4
Municipalities, Financial Conditio i
of Canadian, Febiniary 25 . . . IS
Municipalities Suffer by Bonusing
Industry (Editorial). May 6 .. IC
Municipalities, Will Hold no Respon-
sibilit" for Saskatchewan, Janu-
ary 23 , 40
Municipal Legislation Featured
Quebec Session, April 1 18
Municipal Railways and Provincial
Con<ti-ol (Eiitoi-ial), April 29 .. 9
National Debts, Something About
(Editorial) , April 8 10
National Revenue and Expenditure,
Aprils 3
New Brnnsvrck Funds Railway
r>pbK May 6 24
New Brunswick has Current Deficit,
Februarv 4 40
Newfoundland's Expenditures are
to be Re<luced, June 24 7
Newfoundland Makes Loan in U. S.,
May 20 42
Nevs^ouiv-Jl^nd's Temporary Borr-
cvring^ Hea^/y, May 20 52
New Yoik Frnf's, Collecting Inter-
est in, April 22 .......... - 2>5
Ncra Scotia RpveTiv.e and Expendi-
ture. April 22 42
Nova Sco+ia's Budget and Finances,
May 13 3ii
Nova Suot'i Sells Bonds. .-^ pril 1 . ^(^
Oak B'jv Finances in 1920. Febru-
ary 11 .- 48
O'k Bav Tninroves Financial Posi-
tion. Arril 1 32
Ontario Budset fcr 1921, February
18 3^
Ontario Hydro Bonds, June 24 . . t>
January 1 to June 30, 1921
THE MONETARY TIMES
Index
PAGE
Ontario Losinjr Succession Dues,
March IS . . ', IG
Ontario Sells Bonds, January '2S . . 42
Ontuiio Tre;\surer Estimates Sur-
plus, February 18 30
Ontario Treasury Bills, Another
Issue of, April 8 3tJ
Ontario Treasury Bills Sold, April
1 2&
Ottawa Business and Income Assess-
ment, February 4 48
Ottawa CalHns: Shortly for Loan,
June 24 ... P
Ottawa Municipal Hydro Electric
Results, March 4 36
Paris Bonds Oflered Here, January
21 ". 54
Paris Loan Here, Another, Januarv
14 ■. 62
Penticton, B. C, Finances Improve,
February 4 48
PeterbOiOUg'h Debt Increased Large-
ly, May 6 32
Point Grey Finances, March 11 . . 32
Prince Edward Island Budget,
April 22 22
Problems ot Municipalities, Finan-
cial, June 24 1
Quebec Province, Nearly a Surplus
for, February 4 38
Quebec Revenue and Expenditure,
April 22 43
Quebec Roman Catholic School
Debentrues, March 25 ....... . 52
Red Deer Annual Report, March 4 36
Regina Finances in 1920, April 8 . . 32
Regdna-Moose Jaw Water District,
May 20 40
Religion, Debenture Indebtedness
and, March 25 42
Rent Taxation, Edmonton Seeking,
February 11 48
Revenue ard Expenditure, National,
Aprils 9
Revenue, Source of Dominion, Feb-
niary 2o 32
HACiK
Roumanian Cedit, April 1 8
Rural Muncipal Association, Saska-
tchewan, March 25 14
Saskatchewan iionds Sold, January
28 .. 44
Saskatchev/an Comparative Tax
Rates, April 29 32
Saskatcnevifan Legislation Moderate
in Character, January 21 5
Saskatchewan Local Government
Board, June 17 9
Sasaktchewan Municipalities, Finan-
cial Problems of, June 24 ... . 1
Saskatchewan Municipal Defaults,
April 1 32
Saskatchewan Municipalities, prov-
ince will Hold no Responsibility
for, January 28 40
jsEskatchewan Rural Municipal
Association, March 25 14
Saskatoon Assessment, January 28 40
Saskatoon's Position, May 13 ... . 41
fcherbrooke Hopes to Profit on
Exchange, February 18 48
Single Tax has Many Deficiencies,
June 17 2
South Vancouver Recovering, April
1 33
St. Lambert 'n Difficulties, Febru-
ary IS , 48
St. John Debt Increased, April 8 . . 32
Swift Current In Financial Difficul-
ties, February 25 48
Taber Irrigation District has no
Tax Delinquents, February 25 . . 48
Taxation Now bein^ Tested, War-
time, March 25 5
Taxes on Corporations (Editorial),
June 24 4
Tax Exemptions Prove Burdensome.
Municipal, June 24 5
Tax on Sales, Turnover Tax and
Extended, May 6 5
Tax Rates of Canadian Municinali-
ties, May 27 '. . . 40
r,- i'AGjj
Tax Rates, Saskatchewan Compaia-
tive, April 29 32
Tax Rates,, Weoiein Cities have
High, ,4.pril 22 e
Tax aaic, mortgage on Land Extin-
guished by, April 29 26
Toronto Assessment, oainarj' 14 . . no
Toronto Assessment, February 18 48
Toronto Exemption i:!y-la>v Delayed,
January 28 40
Transcona Requii-es Administrator,
March 18 44.
Turnover Tax and an Extendeu T<ix
on. Sales, May 6 ,.,,._,... . 5
Turnover Tax not Desirable (Edi-
torial), May 6 y
Turnover Tax, The Proposed (Edi-
torial), AprU 1 9
United States, Borrowing in the,
will be Heavy, January 21 ... . 56
United States, Dominion Govern-
ment ;nay Borrow Tl ere. May 13 34
Utilities, i mancihg ot Public, April
8 22
Vancouver Assessment, February 4 48
Vancouver Faced with Deficit,
March 4 S6
Vancouver Finances, April 22 ... . 32
Victoria's Financial Position, May
^.13 .. 32
Vrctory Lean Committee's Work,
AprO 8 7
War Loan Committee's Work, Aniil
8 '.. 7
War-timo Taxation now being
Tested, March 25 5
Western Cities have High Tax
Rates, April 22 6
Winnipeg Bond Issue, Fcbvuary 4 52
Winnipeg Hydro Bonds Taken Up,
January 28 42
Winnipeg Refinancing in Next Six
Years, January 14 4''
Winnipeg- Sinking Fund Report,
February 23 48
Wiiin'peg Tax Rates and Esti-
mates, Marc^ 18 44
The Monetary Times
Printing Company
of Canada, Limited
The Canadian F.nsincer"
Trade Review and Insurance Chronicle
of Canada
Established ISl?')
Old as Confederation
JAS. J. SALMOND
President and General Manager
A. E. JENNINGS
AsBistant General Manager
JOSEPH BLACK
Secretary
W. A. McKAGUE
Editor
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The Year 1920 — Retrospect and Prospect
Turning Point in Price Movement Was Feature of Year— Bond Prices
Reached Low Level, While Stocks Rose and Fell— Bank Loans Increase,
While Deposits Fail to Respond —Insurance Business Continues to Grow
WHEN the armistice was signed Canada stopped and con-
sidexed. This was but a temporary break in the period
of expansion which had commenced in 1916, and the year 1919
found business breaking all war-time records. A real turn in
the tide of progress took place in the year just closed. Prices
are unmistakably coming down, business is contracting, labor
is more plentiful and more efficient, and speculation is on the
decrease. The year 1920 marks a turning point in Canada's
history.
It is remarkable how easily the transition, so far as it
has gone, has been brought about. There have been many
bears in the business world, and these have offset the influence
of business leaders who expected a prolonged period of high
prices and prosperity. Canada has been one of the first to
feel the effects of the downward movement, because she is a
great producer of the raw materials which have been among
the first commodities to suffer price reductions.
Throughout the whole of the year individual buying has
been maintained fairly well. Even the heavy luxui*y taxes
imposed by the Dominion government last June have failed to
materially affect the volume of business as a whole. In fact,
it is probable that a movement towards lower prices, coupled
with a maintenance of the pi-esent wage scales, will place wage
earners in a position to buy more than at any time during the
past few years.
Nevertheless the summer and autumn brought a rapid
contraction in business. This had been anticipated and in
part brought about by the banks earlier in their year, when
they set about bringing the period of credit expansion to a
close. As a guide to business policy this attitude on the
part of the banks was more effective than the mere reduction
in loans which was achieved; in fact, October was the first
month in which current loans showed a reduction, although
earlier reductions in call loans indicated that speculation
was the first field to which the screws were applied.
Primary Production
Primary production has again come to the assistance of
this country. The war-time record of manufacturing industry
was remarkable, but it at the same time is being more and
more felt that the future of this country rests in producing raw
materials and carrying them to shipping points, working them
in some cases through the earlier process of manufacture.
Natural resources are yearly becoming scarcer, and continu-
ally enhanced prices are assured for products of this class.
The acreages sown to grain crops were less this year than
last, but higher yields brought the production to a larger total.
The number of acres sown to wheat was 17,186,300, compared
with 19,295,968 in 1919; 15,555,400 acres were sown to oats,
compared with 14,952,114 in 1919. Acreages sown to other
grains were as follows: Barley, 2,588,000, a decrease of 2 per
cent.; rye, 729,500, a decrease of 3 per cent.; peas, 2,588,000, a
decrease of 3 per cent.; mixed grains, 909,350, an increase of
1 per cent.; hay and clover, 10,409,150, a decrease of 2 per
cent.; alfalfa, 229,300, an increase of 1 per cent,; potatoes,
819,000, about the same as in 1919.
The Northwest Grain Dealers' Association have estimated
the production for the three prairie provinces as follows: —
Wheat, 14,026,000 acres at 15.2 bu., 213,245,000 bu.; oats, 10,-
973,500 acres at 32.8 bu., 359,000,000 bu.; barley, 2,108,000
acres at 23.5 bu., 49,538,000 bu.; rye, 237,500 acres at 16 bu.,
4,400,000 bu.; flax, 1,181,000 acres at 7.1 bu., 8,385,000 bu.
Lumbering was rather less active in 1920, as the prices
were lower. The fisheries on both coasts experienced a good
year. The mines were also working practically to capacity
and had less difficulty as regards labor supply.
Transportation
The railways passed one of their greatest ciises in 1920.
Following a further wage award substantial increases in rates
were granted, though not without strong objections from agri-
cultural and commercial interests. The situation is compli-
cated in Canada by reason of the difference in the financial
condition of the two great railways. The Canadian Pacific is
strong, and no doubt could have continued to render a fair ser-
vice at the old rates. The Canadian National, on the other
hand, is not yet in an independent position, and it is not antici-
pated that much will be left by way of return to the Dominion
government on the investment after operation expenses and
depreciation are met. The soundest argument presented
THE MONETARY TIMES
Volume 66
against the rate increase was to the effect that an effort should
be made to make the Canadian National pay only after its
capitalization had been written down to a niore moderate
level.
In the field of shipping the supply of space this year over-
took the demand. There is a tendency towards keener compe-
tition and lower rates, for the buildinR- of new ghips has now
more than overtaken the ravages of the war. The Dominion
government continued its construction programme and re-
ported good financial results for 1919. Shis recently con-
structed have been at an excessive cost, however, and ship-
ping authorities feel that many of them will not pay in future
Higher Rates for Public Utilities
The outlook for public utilities has greatly improved; the
necessity for rates commensurate with the new level of opera-
tion costs is becoming impressed on the public. Many of the
street railways in Canadian cities secured increases this year.
The Bell Telephone Company made a successful application
for higher rates. Gas and electric light and power companies
all have felt the pressure of high costs, but the year 1920
found their position .as a whole improved.
At the same time there is a growing feeling in favor of
public ownership. The feeling of hostility towards all large
corporations, engendered as a result of the high prices and
lai'ge profits of the war period, will no doubt outlive any
justification which did exist for such feeling. The acquisition
and amalgamation of the Canadian Northern, Grand Trunk
and Grand Trunk Pacific Railways by the Dominion govern-
ment, the proposal for Ontario to purchase the hydro radials
of the Dominion government and the power assets of the
Mackenzie interests are recent examples of the movement
in the government field, while practically every municipality
which do'es not now ovim its street railway is planning to do
so, and some are venturing into the operation of other
services.
Manufactures
The manufacturing industries of Canada have kept up
their record, but during the past year they have felt more
and more keenly the vigorous free-trade movement set up by
the organized farmers in Canada. Efforts made to combat
this movement have, to a large degree, been successful; they
have at least transformed the free trade into a tariff reduc-
tion movement, and have brought home to the city populations
the fact that their prosperity is dependent upon the mainte-
nance of a tariff wall. A commission to investigate the tar-
iff was appointed by the Dominion government, and in Sep-
tember and October evidence was received at the more import-
ant cities throughout Canada. The findings of this commis-
sion have not as yet been announced, but it is an accepted
view that a commission composed of three members of a pro-
tectionist government will scarcely advocate any appreciable
reduction.
Tendency of Banks to Contract
Developments in the sphere of banking were of a mixed
character. The movement of expansion exte.ided through the
early months, but the banks made a concerted effort to bring
about a contraction of credit. This action was taken in antici-
pation of price reductions, and was beneficial to merchants,
who were still inclined to maintain hea%'^' stocks of goods on
hand. Reductions in credits first took place in the call money
market, the maximum loaned at call in Canada having been
reached in January, when the figure was .'6132,015,334. By
the end of June it had been reduced to $115,360,894. Current
loans continued steadily upwards, however, the total in Can-
ada at the end of July being $1,377,276,853, compared with
.■^1,226,962,963 at the end of January, 1920, and with $1,014,-
■ '87,206 at the end of July, 1919. Savings deposits showed a
teady increase, though not as rapid as in 1919, while the level
cf demand deposits was higher than in 1919.
Good Year for Insurance
Unquestionably 1920 was one of the best years in the his-
tory of insurance in Canada. Life business continued to ex-
perience the expansion which showed such phenomenal results
for 1919, but it is not expected that the increase in business
written in 1920 will be so great. There was no epidemic such
as took place in 1918, and reappeared in lesser degree in 1919,
to threaten the companies' surplus. The rise in property
values brought about a substantial increase in the volume of
fire insurance in force, and fire losses were about the same as
in 1-919, which was regarded as a fair year. There was
growth in all branches of casualty insurance, further particu-
lars of the experiences in which will be found in the series of
reviews in the insurance section of this number.
Loan and Trust Business
There was no new development in the loan and trust field.
The experience of the former as regards repayments of mort-
gage loans was good, as the general good crops in the west
enabled the farmers in many cases to bring their payments
up to date. There were sections, of course, in which crops
were not so good this year, and further extensions had to be
made. Funds for new borrowings were not plentiful, as the
companies on the one hand were more careful in anticipation
of lower prices for farm produce, and on the other hand were
tempted to invest still more of their funds in bonds, which
were obtainable at exceptionally low prices.
The trust companies again experienced an increased de-
mand for their services. Corporate administration of estates
is continually becoming more popular in Canada because of
the undoubted advantages which it offers. One notable fea-
ture of the year was the greatly increased demand for safety
deposit boxes, due to the more widespread holding of securi-
ties.
The Bond Market
The investment field witnessed some rather unexpected
developments. Government and municipal bonds and other
first-class securities sank to still lower levels. In spite of
this, new issues were numerous and the low prices secured im-
pose heavy capital charges on the provinces and municipali-
ties. There was no Dominion government loan for the first
year since 1915, but this important factor did not appear to
strengthen the market to any appreciable extent.
The control of the Victory bond market resumed in
January by the Dominion government, and the embargo on
the impoi't of securities which accompanied it, were two im-
portant factors in the investment field. Neither was suc-
cessful in attaining the desired object, which was to prevent
the decline in war bond prices and in security prices as a
whole. The market showed a little strength towards the
end of November, however, and control was removed.
The Stock Market
Corporation bonds moved downward in sympathy with
the security market in general. The greatest collapse took
place in the stock market, however, which reflects in greater-
degree the trend of business. The fall in the prices of sugar,
rubber, steel and other leading commodities was followed
and in some cases anticipated by the price movements of
stock specialties. Liquidation of stocks was encouraged by
the pressure of the banks.
In the face of these conditions the number of security
issues was exceptionally large. The lists given elsewhere in
this issue show that the provincial governments were very
heavy borrowers, and while the smaller municipalities
generally kept out of the market, ■ the larger cities also
borrowed freely. The high rates prevailing for New York
exchange resulted in an unusual proportion of the new loans
being placed there, heavy obligations for many years to
come being piled up in this way. Corporate financing was
also active, especially in speculative stocks. Theatre issues
were especially numerous, and considerable interest was also
evinced in mining and oil issues.
There has, therefore, been a good deal accomplished
during the past year in the way of restoring business to a
more healthy and normal state. The process of deflation is
bound to bring its difficulties in the way of failures, contrac-
tion of profits and readjustment of. wages, but there is good
evidence that the process is being brought about gradually
and the danger of collapse or panic is thereby minimized.
January 7, 1921
THE MONETARY TIMES
Business Indices Reflect Contraction of Business
Peak of Business Activity, As Reflected By Bank Clearings, New Building. Failures,
and Other Figures, Was Reached at Beginning of 1920 — Building Inactive, While
Failures Increase — Falling Stock Prices Anticipate Further Business Contraction
CANADIAN business reached its greatest activity in
January, 1920, according to an average of commonly ac-
cepted indices, compiled by Babson's Statistical Organiza-
tion, Wellesley Hills, Mass., and grapliically presented be-
low. The black areas are formed by combining and plotting
figures on Bank Clearings, New Building, Failures, Com-
modity Prices, Railroad Earnings, Security Prices, Ratio of
Bank Cash to Liabilities, and Money Rates — subjects whicli,
taken together, make a reliable measure of general busi-
ness. The X-Y line represents the average gain or growth
in business. In locating the X-Y line we have assumed that
the law of equal action and reaction applies to business and
gi-owth of the country, with a more rapid increase in 1007, a
year of crisis. The year 1914 again brought depression,
with many failures up to the middle of 1915, when war-time
expansion commenced. Thereafter the number of failures
fell to a very low point in 1918 and again in 1919. The
past six months have found them growing rapidly.
Building Operations
Building was very inactive during the war years. There
was a slight revival in 1918, due to the great scarcity of
houses and business plants which was making itself felt;
a substantial revival took place in the summer of 1919, and
Coprr^lhl All Ri(ht> Stncil, R«i
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IMS
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IMS
1909 mo 1911 1912 19i3 19(4 1915 1916
1917
1918
1919 19J0
Babson Compositplot of Canadian Basmess Conditions
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Failure
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.
economic phenon.ena just as it does to mechanics, chemistry,
medicine and other sciences. In other words, for every de-
gi'ee of over-expansion in business a corresponding rest
period or depression must be experienced. The X-Y line,
therefore, is drawn to make the two areas of each cycle equal,
its trend being detei-mined in accordance with such statistics
of growth as are available.
Two Cycles Completed
There are now two complete cycles on the plot. The
first (Areas B and C) runs from the end of 1905 to 1908.
The second (D and E) runs from 1908 to the latter part
of 1915. For the past five years a large area of business
expansion has been developing, which indicates that a re-
action in trade may normally be expected.
The red line represents the monthly average prices of
ten stocks. The solid black line shows failure liabilities;
the dotted black line, new building. The figures for new
building and commercial failures are plotted quarterly.
The movement of failures, it will be noticed, is very
irregular. It seems usually to be higher at the end of each
year, because that is the end of an accounting and settling
period and also because business is usually quiter at that
season in Canada. There was a gradual increase, however,
from 1904 to 1914, which was not out of proportion to the
in the summer of 1920 operations again approached their
pre-war proportions, followed by the usual autumn decline,
Stock prices are the most sensitive of all business in-
dicators, anticipating the others by several months, and these
do not hold out any hope of revival. The high levels of 1916
were followed by a long decline, in anticipation of the post-
war depression which was bound to come. In 1918 and 1919,
however, the reconstruction activity was anticipated by an
upward movement, which culminated in November, 1919,
but after which a real fall did not take place until the
third and fourth months of 1920.
The average trend of business, represented by the black
area, indicates that the second half of the cycle commenc-
ing in 1916 has set in, and that a fairly long period of
depression may be looked for.
In the developments of the next few years, therefore,
an increase in the number of failures and reductions in
profits, as reflected by lower stock prices, may be looked for.
Nor can the volume of building be expected to increase very
much until such time as costs have been reduced to a level
commensurate with market values. Bank clearings, railroad
earnings, loans and trade figures should show reductions in
accordance with the condition of business as a whole. Rates
for money, on the other hand, should before long show an
easier tendency.
THE MONETARY TIMES
Volume 66
More Stable Policy Needed for Welfare of Canada
Slump in Prices is Test of Country's Industries— Europe's Need Does Not Help
Business Here— What Measure of Tariff Protection Necessary Could Be Scien-
tifically Ascertained — National Debt and the Resulting Burden on Industry
By W. W. SWANSON, Ph.D.
Professor of Political Economy, University of Saskatchewan
IT was pointed out in the early months of the war by Prof.
S. Patten of the University of Pennsylvania that a sudden
decline in prices after the cessation of hostilities might easily
wipe out all the war profits of the republic and cause hard-
ship and suffering throughout the world unparalleled in mod-
ern economic history. While it is quite true that natural
resources, farms, factories and other concrete economic goods
would remain after such a collapse of prices, nevertheless the
actual loss of wealth following a steep fall in market values
would adversely affect the entire business life of the nation.
It is of fundamental importance to speed up production in
Canada, but it is equally important to protect prices as far as
may be by refusing to give way to panic and the forces that
make for business depression.
It is admitted that Canada cannot escape the effects of
world-wide economic conditions, but much can be done to
maintain confidence in what is fundamentally sound in the
nation's economic life. Only a few years since trust-baiting
was a favorite pastime of demagogues and their followers in
the United States notably, as well as in the Dominion; but the
sober sense of the people has taught them that in the long
run business, big or small, must rest upon the good-will and
confidence of the people or it cannot endure. And what is
true of business in general is doubly true of the great basic
industries within the confines of our common country. The
time is opportune to make an earnest effort to co-ordinate the
interests and activities of the manufacturers, the agricultur-
ists and the several governments concerned to the end that
good-will may displace mutual suspicion and conflict. While
there always will be large issues of national economic import-
ance upon which opinion will be divided, there is much common
ground that can be cultivated for the common good. Confi-
dence in the integrity and fairness of men who control indus-
tries and governments is the sine qua non of national stability
and progress.
The West's Grievances
Rightly or wrongly, the agricultural West has felt that
its industrial progress has been liinited and thwarted by the
short-sightedness and selfishness of the manufacturing and
financial East. The fact is there, whatever its causes, and it
will do no good to speak of the sacrifices of the east in railway
building and the like for the development of the prairies. The
people of the west are persuaded that they are carrying their
fair share and more of the common burden of exploiting and
developing the natural resources of the nation. The various
provincial governments have, on the whole, given sympathetic
consideration to the conserving of the agricultural interests of
the people, but in general the Dominion's national economic
policy has placed the emphasis to too great an extent upon
manufacturing and to too small a degree upon agriculture.
As an excuse it is asserted in certain quarters that a gro\\nng
population can be provided for only by expanding industry and
commerce — that the amount of food required from the farm
is limited in amount, while the consumption of manufactured
goods has no definite limits. This loses sight entirely of the
significance of the relation of food supplies to an expanding
population and an expanding industrial environment.
In his "Economic Consequences of the Peace" J. M,.
Keynes draws attention to the fact that as late as 1890 Europe
had a population more than three times as great as the entire
population of tlie North and South American continents. Since
that time the populations of the new world and the old have
vastly increased. Before the war Russia was expanding at
the rate of 2,000,000 annually, Germany at the rate of 850,000,
and Austria-Hungary at 500,000. Europe was making vast
gains in population each year while on this side of the water
the increase in numbers was equally rapid. The net result
was a relative dearth of foodstuffs throughout the western
world. ^
The Cost of Food
This growing shortage of food supplies was evidenced by
the rising prices of foodstuffs everywhere. Mr. Keynes
reaches the conclusion that the economic law of diminishing
returns was at length making its effects felt ■ — that popula-
tion was pressing hard upon the means of subsistence. It
was in 1798 that Thomas Malthus formulated and presented
to the public his famous hypothesis of the relation of food sup-
plies to population; but the opening up of new areas of supply
during the nineteenth century caused his theories to fall into
discredit, when they were not forgotten. Once more, however,
the relation of agriculture to industry becomes of surpassing
importance, particularly in view of the fact that the United
States is rapidly approaching the point where it will be
rather an importer than an exporter of wheat and other food
commodities.
The bearing of all this upon the present agricultural situa-
tion in Canada is patent. Upon the prairies there is discon-
tent among both grain growers and stock producers with past
economic policies and present prices. The market for farm
products may be extensive and constantly expanding because
of the growing necessities of the world, but all that avails
nothing if the agriculturist cannot make a living commen-
surate with the efforts and sacrifices undergone. Canada's
greatest agricultural province, Saskatchewan, already begins
to show the effects of the narrowing of the gap between mar-
ket prices and costs of production. According to the figures
recently furnished to the legislature by the Hon. Chas.
Dunning, that province has seen more than one million acres
go out of cultivation in 1920. The total area under cultivation
in 1919 was 2.3,585,000, whereas the figures for 1920' are only
22,549,000. The wheat acreage for 1920 showed a decrease of
520,000 acres as compared with the previous year. The yield
per acre had increased from 8.5 to 11.2, the total yield of wheat
for 1920 being estimated at 113,125,000 bushels. Both the
yield per acre and the area under cultivation of oats are larger
for 1920 than for the previous year, the total yield of this
grain being placed at 141,549,000 bushels. There was an in-
crease of 27,000 acres sown to barley, and of 210,000 acres
sown to flax, while there was a falling off of 18,000 acres sown
to rye. There was a decrease of summer-fallow from 4,395,-
000 in 1919 to 3,751,000 in 1920, while the new breaking in
1920 amounted to only 549,000 acres. In cattle, horses and
swine there has been a heavy reduction in the numbers held,
sheep alone showing an increase. The price factor and the
high cost of production have been the chief reasons for this
serious falling off of agricultural production. The decline in
prices brings with it an enormous decline also in the purchas-
ing power of the west.
Raw Materials and Manufactured Goods
It is not forgotten that the falling off of market prices is
a phenomenon that characterizes the production of raw ma-
terials everywhere — from lead and zinc, copper and silver, to
sulphur, tea, coffee, cotton, raw silk and rice. Nevertheless, it
avails our fai-mers little to be assured that they are not the
sole sufferers in the liquidation of values. The simple fact is
that if too wide a gap is fixed between what the producers of
basic raw materials bring to market and what they must buy
for family purposes and to take care of the processes of pro-
January
THE MONETARY TIMES
duction, the fundamental industries will stagnate. This would
be fatal not only for those territories and countries still in the
pioneer stage of development, but for the secondary industries
depending upon them for support, for markets, and for buying
power, and for raw materials as well. Steps should be taken,
therefore, not only to aid the agricultural community to reduce
its costs of production but to alter its psychological attitude to
the buying of essential products. The markets of the west
and the export trade are vital to the manufacturing east, both
in Canada and the United States as well.
What Industries Need the Tariff
The psychology in the situation rests upon the economic
factors involved. Chief among these economic factors are the
tariff, finance and railway rates. With respect to the tariff it
will no longer suffice merely to ask critics of protection to
name specifically those industries that can exist without arti-
ficial aid, as Sir Henry Drayton asked Mr. Wood, president of
the United Farmers of Alberta, at Calgary. There ought to
be a scientific study of the tariff in Canada, similar to that
undertaken in the United States for the tariff commission by
Professor Taussig of Harvard and his staff of able assistants.
Such an examination could determine whether our manufac-
turers of agricultural implements and farm machinery, if
granted customs-free raw materials, are actually in a position
to give up the advantages of a protective tariff. Moreover, it
could also be decided whtit are the so-called "key" industries
requiring protection to render the Dominion secure in war and
peace, and which are the "luxury" industries for which the na-
tion is paying too great a price. Finally, the complex and
difficult problem of the relation of protection to necessary pub-
lic revenues could be at least tentatively solved. Such a scien-
tific study, undertaken by experts and representatives of all
classes, would accomplish something enduringly good, whereas
the present tariff inqury gets the nation nowhere. It is worth
while emphasizing these factors, for beyond doubt the decline
in the demand, at present, for manufactured products is due
in no inconsiderable measure to the belief on the part of the
agricultural producers of the west that their economic interests
have been sacrificed.
Need for the Wheat Board
The disclosure of facts under scientific analysis will do
much to allay suspicion and make for the building up of good-
will among the great economic groups in Canada. Nothing is
so unsettling to business as a state of unstable equilibrium
occasioned by mutual distrust. What is required, among other
things, is the working out of a definite national economic pol-
icy that will give due weight to the interests of the agricul-
tural community. The wheat board, for example, should be
reconstituted, not perhaps to assume the responsibility of actu-
ally marketing the farmers' big cash crop, but for devising
ways and means to assist in the marketing of that crop to the
best advantage. Some such organization is essential, not
merely for the marketing of wheat, but for the furnishing of
accurate information with respect to markets for other farm
products. Such a body should also institute studies concern-
ing costs of production, distribution and final saje of agricul-
tural commodities. With such data available something
worth while could be attempted to promote the best interests
of Canadian agriculture. A case in point is the purchase of
the entire output of New Zealand's butter by the British gov-
ernment, with a consequent decline in the domestic and export
prices of the Canadian commodity. The dairy industry is an
expanding one in the west and becoming of great economic im-
portance in agricultural operations. Balanced farming is not
only economically sound but of vital importance to the stabil-
izing of agriculture; but it is discouraging to produce the
goods only to find the markets blocked.
Debt and Taxes Are Heavy
On the other hand, it is equally essential to find steady and
profitable employment for factory operatives and those en-
gaged in commercial pursuits, as well as to discover markets
for the output of their labor. It has often been stated, but it
requires constant repetition, that the Dominion is in need of a
settled economic and political policy that will conserve the
interests of all classes of producers. The net debt of the na-
tion is, in round numbers, $2,225,000,000, and is still growing.
True, revenue is also increasing in a way that will take care
of fixed charges and current expenses, but the greater part of
that revenue — customs, excise and war taxes — is derived
from taxation and represents a heavy burden upon industry.
Among the nations of the world Canada is in a strong finan-
cial condition, but the finest statesmanship and the greatest
efforts on the part of all will be essential to keep it there.
During the past twelve months the external trade of the nation
has amounted to more than $2,500,000,000, the imports being
in excess of exports by approximately $125,000,000. Imports
from the United States are dangerously in excess of exports,
and every effort should be made to widen our export markets
in the Republic and in Europe.
To do so will involve a heavy reduction in costs of produc-
tion and selling prices. Until Europe is economically rehabili-
tated prices will not be materially hardened by extensive sales
there. On the other hand, the plant equipment of the Domin-
ion, consisting of field, mine, factory, railway and shop, is
capable of far greater production than in the days preceding
the war. A great deal of necessary woi-k, with restored con-
fidence, lies ready at hand in Canada in "deferred mainte-
nance" — in the consti-uction of buildings, and the production
of railway and other equipment halted by the war. There is
an immense amount of construction that ought to be immedi-
ately undertaken by the federal and provincial governments,
in the building of public works, the St. Lawrence deep water-
way system, and the making of roads. Such economic under-
takings would stimulate the demand for the output of fac-
tories and aid in keeping the wheels of industry revolving. To
those who insist upon public economy it may be replied that a
collapse of Canada's industrial system, with consequent unem-
ployment, would in the end place far heavier burdens upon
the people, industry and the government than any additional
tribute of taxation now to take care of interest upon public
capital expenditures.
Demand Limited by Purchasing Power
It must be squarely recognized that owners can operate
plants only if costs of production are fnet, including a fair
retui-n on capital. True, the European nations are in need of
goods, but that need can be translated into economic demand
only as it is backed by purchasing power. The old analogy
based upon civil war conditions and following prosperity does
not hold good to-day for the simple reason thjit the civil war
struggle was a domestic struggle and confined to a single ter-
ritory, permitting the United States to depend upon Great
Britain and other wealthy nations for financial aid. Since the
armistice the United Kingdom has labored hard to revive the
trade of the continent, but the task is too stupendous for the
efforts of one nation alone. The action of the United States
in refunding only $100,000,000 of the Anglo-French loan fur-
ther depressed European exchange and made it more difficult
for the British and French to purchase the goods produced on
this continent. As a first and essential step in increasing the
buying power of Europeans the United States must come to
the financial support of those war-stricken nations.
Danger of Unemployment
The great danger threatening the economic life of
Canada and the United States is that under-employment
may develop, or unemployment, with resultant low wages,
or their lack, and a general breakdown of the stan-
dard of living, and hence of the buying power of the
masses. During a period of falling prices, also, there is little
or no incentive for the manufacturer to extend his plant and
engage in new enterprises. The factor in the situation, there-
fore, making for business stability is the discovery of new
markets for the output of our factories and the prevention of a
sudden collapse of prices. The laws of the United States have
been adapted to meet changed conditions, and now permit and
encourage export associations of American manufacturers. It
is highly expedient that Canadian business be fostered and
developed by similar measures, notably by export associations
and the sending of able agents abroad to broaden export trade
with the United States. For under the new price conditions a
larger volume of goods must be produced to enable manufac-
THE MONETARY TIMES
Volume 66
tuiers and the govei-nment to carry their financial obligations.
Germany, before the war, owed its commercial and indus-
trial success in no small measure to efficient financial, as dis-
tinguished from commercial, banking. German financial insti-
tutions were prepared to hold long-term securities as the basis
of financial support for the export trade of German manufac-
turers. The iiuestion has already been raised in London as to
what can be done to establish a bank of rediscount for the
empire, but the equally important problem remains to be
solved as to how long-time credit can be offered by British
and Canadian manufacturers without dangerously placing lim-
its upon their liquid assets. It is not tlie business of commer-
cial banking to assume such risks, but the time is at hand
when Canadian manufacturers must find some safe method of
granting longer credits if they arc to strengthen their position
in foreign markets.
Canada's Economic Progress at a Glance
Development of the Dominion Geographically Illustrated in Figures of Production, Trade
Banking and Currency - Effect of the War on the Country's Industry Clearly Reflected
'T'HERE is no better and easier way of describing the eco-
A nomic development of a country than by statistics. A few
well-selected figures contain more information than any liter-
ary volume in this respect. In the following tables, which
have been carefully prepared and selected by The Monclayy
Times, the economic progress of the Dominion is graphically
illustrated: —
POPULATION
■(Immigration
PRIMARY PRODUCTION— Continued
1871 3,689.257
1881 4,324,810
1891 4,833,239
1901 5,371,315
1911 7,296,643
*1914 7,725,000
1915 7,928,000
1916 8,140,000
1917 8,361,000
*1918 8,593,000
*1919 8,835,000
* Estimated
1897 21,716
}1900 23,895
1905 146,266
1910 208,794
1913 402,432
1914 384,878
1915 144,789
1916 48.537
1917 75,374
1918 79,074
1919 ■ 57,702
t From other countries.
+ 6 months — Jan. to June.
. PRIMARY PRODUCTION
Total value Wheat yield Value of
field crops bushels wheat
1914 $638,580,300 $161,280,000 $196,418,000
1915 825:370,600 393,542,600 356,816,900
1916 886,494,900 262,781,000 344,096,400
1917 1,144,636,450 233,742,850 453,038,600
1918 1,372,935,970 189,075,350 381.677,700
1919 1,452.437,500 193,260,400 364,857,000
PRIMARY PRODUCTION— Continued
Total value of pulpwood Fisheries
1914 $8,089,868 $33,207,748
1915 9,426,217 31,264,631
1916 13,104,458 35,860,708
1917 18,817,483 39,208,378
1918 24,886,475 *60,363,502
* Calendar year.
PRIMARY PRODUCTION— Continued
Coal Coal
tons value
1914 13,637,529 $33,471,801
1915 13,267,023 32,111,182
1916 14,483,395 38,817,481
1917 14,046,759 43,199,831
1918_— 14,979,213 55,752,671
1919 13,586,300 54,051,720
PRIMARY PRODUCTION— Continued
Gold Silver Nickel
ozs. ozs. lbs.
1914 773,178 28.449,821 45,517,937
1915 918,056 26,625,960 68,308,657
1916 930,492 25,459,741 82,958,564
1917 738,831 22,221,274 84,330,280
1918 710,526 21,284,607 92,076,034
1919 767,167 15,675,134 44,542,953
Copper Total value
lbs. mineral production
1914 75,735,960 $128,863,075
1915 100.785,150 138,920,759
1916 117,150,028 177,201,534
1917 109,227,332 189,646,821
1918 118,415,829 210,204,970
1919 74,124,653 173,075,913
BANKING STATISTICS
Paid-up Capital
Oct. 31. Total assets and Reserve
1910 $1,260,755,709 $176,889,102
1911 1,381,280,989 199,582,373
1912 1,521,105,096 218,773,578
1913 1,575,550,980 226,966,252
1914 1,577,919,069 228,245,019
1915 1,657,256,962 226,738,438
1916 1.968,940,288 226.053,811
1917 2,244,878,054 225,187,422
1918 2,638,839,732 217,712,095
1919 2,967,598,848 241,152,863
1920 3,155,601,568 257,682,757
BANKING STATISTICS— Continued
Deposits on demand
Oct. 31 and after notice Circulation
1910 $829,855,337 $95,992,866
1911 918,404,607 105,855,021
1912 1,023,912,500 110,696,877
1913 1,011,367,714 118,234,359
1914 1,008,539,512 123,744,682
1915 1,093,379,043 122,782,233
1916 1,303,527,638 145,031,667
1917 1,480,849,299 195,298,212
1919 1,968,027.027 242,509,573
1920 1,958,927,532 252,882,760
LOAN AND TRUST
Loan Companies Trust Companies
(assets) (assets)
1914 $70,588,091 $10,740,640
1915 71,992,666 7,306,350
1916 70,872,297 7,826,943
1917 69,676,223 7,656,292
1918 69,995,036 8,836,i37
CURRENCY
*Dom. notes tBank notes
in circulation in circulation
1911 $99,308,945 $89,982,223
1912 111,932,238 100,146,541
1913 116,363,537 105,265,336
1914 114,182,098 104.600,185
1915 152,117,695 105,137,092
1916 175,494,135 126,691,913
1917 178,564,970 161,029,606
1918 281,336,474 198,645,254
1919 299,530,655 218,919,261
1920 292,016,290 228,220,603
* Year ended June, t Monthly average.
January 7, 1921
THE MONETARY TIMES
TRADE OF CANADA*
Fiscal year Exports of Exports of
ended March Canadian produce foreign produce
1906 $235,483,956 $11,173,846
U907 180,545,306 11,541,927
1908 246,960,968 16,407,984
1909 - 242,603,586 17,318,782
1910 279,247,551 19,516,442
1911 274,316,553 15,683,657
1912 290,223,857 17,492,294
1913 355,754,600 21,313,755
1914 431,589,658 23,848,785
1915 409,419,503 52,023,67r
1916 1 741,610,953 37,689,432
1917 1,151,461,855 27,835,332
1918 1,540,318,069 46,142,004
1919 1,207,613,806 52,321,479
1920 1,239,492,098 47,166,611
* Merchandise only. t Nine months.
TRADE OF CANADA*— Continued
Fiscal year Imports for Total trade
ended March consumption of Canada
1906 $283,282,204 $529,940,006
tl907 249.737,874 441,825,107
1908 351,879,955 615,248,907
1909 288,217,515 548,139,881
1910 369,815,427 668,579,420
1911 451,745,108 741,745,318
1912 521,448,309 829,164,460
1913 670,089,066 1,047,157,421
1914 618,457,144 1,073,894,368
1915 455,446,312 916.888,821
1916 507,817,159 1,287,117,229
1917 845,356,306 2,024,567,406
1918 962,543,746 2,548,713,538
1919 916,443,432 2,176,378,717
1920 1,064,528,123 2,304,020,221
* Merchandise only. t Nine months.
BOND SALES
Year Sales in Canada Sales in U. S.
1910 $39,296,462 $3,634,000
1911 44,989,878 17,553,967
1912 37,735,182 30,966,406
1913 45,603,753 50,720,762
1914 32,999,860 53,944,548
1915 114,275,214, 178,606,114
1916 102,938,778 206,943,764
1917 546,330,714 174,708,365
1918 727,446,361 33,310,000
1919 705,385,419 199,446,670
BOND SALES— Continued
Year Sales in U. K. Total bond sales
1910 $188,070,128 $231,000,590
1911 : 204,269,143 266,812,988
1912 204,236,394 272,937,982
1913 277,470,780 373,795,295
1914 185,990,659 272,935,067
1915 41,175,000 335,106,328
1916 5,000,000 356,882,542
1917 5,000,000 726,039,079
1918 14,600,000 775,356,361
1919 5,105,133 909,937,222
The sales in the United Kingdom since 1915 have nearly
all been refunding issues.
TRANSPORTATION
Steam i-ailways Elec. railways
(earnings) (earnings)
1914 $243,083,539 $29,691,007
1915 199,848,072 26,922,900
1916 261,888,654 27,416,285
1917 310,771,479 30,237,664
1918 330,220,150 24,299,890
1919 I 382,976,901 35,696,532
INSURANCE
Fire Fire Fire
(premiums) (losses) (at risk)
1911 $20,575,255 $10,936,947 $2,279,868,346
1912 23,194,518 12,119,581 2,684,355,895
1913 25,745,947 14,003,759 3,151,930,389
1914 27,490,158 15,347,284 3,456,019,009
1915 26,474,833 14,161,949 3,531,620,802
1916 27,783,852 15,111,133 3,720,058,236
1917 31,246,536 16,379,101 3,986,197,514
1918 35,954,408 19,359,252 4,523,514,841
1919 39,914,398 23,207,647 4,904,396,461
INSURANCE — Continued
Life Life
(net in force) (premiums)
1913 $1,168,590,027 $38,641,206
1914 1,242,160.478 41,094,095
1915 1,311,616,677 45,106,678
1916 L 1,422,179,632 48,093.105
1918 1,785,061,273 61,641,047
1919 1 2,187,833,396 74,689,262
MISCELLANEOUS
Dun's Price
Bus. failures Index Bldg. permits
1911 1,332 127.4 $138,170,390
1912 1,357 134.4 185,233,449
1913 1,719 135.5 153,662,842
1914 2,892 136.1 96,780,981
1915 2,652 148.0 33,566,749
1916 1,677 182.0 39,724,466
1917 1,088 237.0 33,936,426
1918 873 278.3 36,838,270
1919 751 293.2 77,113,413
Canada's Progress Graphically Illustrated
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FRUIT PRODUCTION UNUSUALLY LARGE
The largest crops of fruit so far grown in southern On-
tario were grown in the year just ended. Prices of some
fruits were the lowest since 1914. This fall in prices, coupled
with the high cost of labor, of containers, of freight and other
expenses, cut down the profits of the growers. "Perhaps the
worst year we have ever had in our whole history as fruit-
growers," was the way a prominent fniit-grower summed up
the situation in the Niagara fruit belt. The growers claim
they have made hardly any money on the great output of
peaches, cherries, plums, etc.
THE MONETARY TIMES
Volume 66
New Government Legislation and Its Effects
Taxes Imposed at H)20 Session Have Swelled Dominion's Revenue — The
Government Shipbuildins Subsidy— Soldier Settlement Plan and Its Results
—The Tariff and the Tariff Commission— New Trade Relation Established
THE 1920 session of Parliament, which opened on February
21st and closed on July 1st, was notable more for the im-
portance rather than for the number of its enactments. In
volume its product was not nearly as large as that of the fii'st
session in 1919, but especially in matters of taxation there was
a launching out along new lines which made its work of a very
high order of importance.
The first Drayton budget represented something new in
Canadian taxation methods and general fiscal policy. As ex-
perience has shown, it was sagacious; but before results were
forthcoming to determine whether it was sagacious or not it
was generally admitted to be courageous. Pay-as-you-go as
a national policy sounded well, but the question was; How will
it work?
New Taxation Has Been Productive
Confronted by the problem of raising nearly $600,000,000,
Sir Henry cut expenditure as much as possible, but evidently
realizing that he could not by this means hope to make income
balance expenditure, he cast about for new sources of revenue
and decided to introduce the luxury and sales taxes, and also
made certain increases in the income tax. At the same time
he courageously reduced the business profits war tax and the
7% per cent, customs war tax. He estimated the revenue at
$381,000,000 and said that collections on outstanding accounts
and balances due from Great Britain would probably amount
to $570,000,000. There was no definite estimate of what the
new taxes would yield.
Under the classification "New excise taxes" are included
the taxes on luxuries. These, imposed with a view to check
the expenditure on what may be considered non-essentials,
were considerably altered by the time they had left the com-
mittee stage. They are so based and scaled as to exempt, as
far as possible, goods of a nature and price such as may be
considered necessary. They are paid by the purchaser to the
vendor at the time of sale and delivery for consumption and
use. They range from 10 to 50 per cent. The tax on beer,
wine and spirits was also increased.
The sales tax, which is in addition to the excise and the
customs tax, is a tax of 1 per cent, collected on all sales by
manufacturers, wholesalers or jobbers, and on the dutiable
value of importations, but in respect to sales made by manu-
facturers to retailers or consumers, or on importations by re-
tailers or consumers, the rate is 2 per cent.
Stamp taxes, the tax on cheques, was continued, the rate
•being increased on bills of exchange and promissory notes so
as to provide a two-cent tax on all bills or notes of $100 or
less, and for every additional $100 or fractional part thereof
two cents more. A tax of two cents for each share of stock
transferred was also imposed.
Income and Business Profits Taxes
The rate on incomes of $5,000 a year and upwards was
increased by 5 per cent. As a result the tax on a personal
income of $5,000 brings $126, compared with $100 before; on
an income of $50,000 $9,649.50 is collected, compared with
$5,782, and on $100,000 the collection is $10,500, as compared
with $6,000.
The business profits war tax was continued but reduced,
the exemption being extended from 7 to 10 per cent. • The new
schedule is as follows: On profits in excess of 10 per cent, but
not exceeding 15 per cent., tax 20 per cent. On profits in ex-
cess of 15 per cent., but not exceeding 20 per cent., tax 30 per
cent. On profits in excess of 20 per cent., but not exceeding
30 per cent, tax 50 per cent. On profits over 30 per cent., tax
60 per cent. The tax on pi-ofits of business with a capital of
not less than $25,000 and under $50,000 was reduced from 25
to 20 per cent, on all profits exceeding 10 per cent, on the
amount of capital employed.
The customs war tax, which amounted to 7% per cent.,
was abolished. The other tariff changes were of minor im-
portance.
Tariff Revision Promised
Sir Henry announced that the tariff commission would be-
gin its enquiry after prorogation. He also stated the tariff
policy of the government as follows: "Our policy calls for a
thorough revision of the tariff with a view to the adoption of
such reasonable measures as are necessary: (a) To assist in
providing adequate revenues; (b) to stabilize legitimate indus-
tries and to encourage the establishment of new industries
essential to the proper economic development of the nation, to
the end that a proper and ever-increasing field of useful and
remunerative employment be available for the nation's work-
ers; (c) to develop to the fullest extent our natural resources;
(d) to specially promote and increase trade with the Mother
Country, the sister dominions and colonies and crown depen-
dencies; (e) to prevent the abuse of the tariff for the exploi-
tation of the consumer; and (f) to safeguard the interests of
the Canadian people in the existing world-struggle for com-
mercial and industrial supremacy."
Assistance to Shipbuilding
In order to assist Canadian shipbuilding plants in securing
foreign orders legislation was enacted authorizing the govern-
ment to make advances upon approved securities up to 50 per
cent, of the value of such orders, a condition being that one-
fourth of the value of the vessels ordered should be paid for
in cash, the other fourth to be arranged for by the builder.
The advances thus authorized were $20,000,000. Mexico en-
deavored to take advantage of this provision, but owing to the
instability of conditions in that country her application was
not entertained. It is understood that other applications have
been made.
Railway Problems
Railway matters occasioned a great deal of discussion, as
these involved an expression of opinion on the cost of operat-
ing the Canadian National system and the Grand Trunk, to-
gether with opinions as to their value and the extent of the
obligations assumed in the taking over of these enterprises.
The statement of the minister of railways to the effect that
the deficit on government railways was $48,611,000 produced a
lengthy debate, the opposition contending that in reality the
deficit was much larger. There was further discussion over
the authorizing of advances for approximately $17,000,000 to
the Canadian Nationals for equipment, also over the authoriz-
ing of a loan of $25,000,000 to the Grancl Trunk. During the
year the Canadian Nationals floated a $15,000,000 equipment
loan in the United States, guaranteed by the Dominion gov-
ernment, while another loan of $25,000,000. issued by the
Grand Trunk and also guaranteed by the Dominion govern-
ment, was disposed of over there.
Among acts of special importance to men of business was
that relating to trusts and loan companies, and which, in so
far as inspection is concerned, placed them on the same basis
as insurance companies. The inspection will be of a regular
nature. The Supreme Court Act was amended so as to bring
about a simplification and uniformity of procedure in matters
relating to the court and to prevent appeals being brought be-
fore it in matters of a low order of importance. Appeals are
now restricted to cases in which the amount at issue exceeds
$2,000 in value exclusive of costs; in all other cases appeals
shall be made by special permission of the highest court in the
province.
A considerable increase was made in pensions to returned
soldiers. The wheat board gave rise to much discussion, the
.lanuaiy 7, 1921
THE MONETARY TIMES
government being given power to recreate the board if it were
deemed advisable to do so.
Soldier Settlement
The soldier settlement scheme developed rapidly during
the year and has proven to be undoubtedly the most impor-
tant permanent colonization effort of its kind that Canada
has ever seen. To date approximately 57,000 returned sol-
diers have made application for the purpose of qualifying
and thus taking advantage of its opportunities. No less than
41,000 have been declared qualified, while over 19,600 have
received advances amounting to about $80,000,000.
Alberta has received by far the largest number of those
settlers, followed by Saskatchewan, Manitoba and British Co-
lumbia. Of the total over 85 per cent, have located west of
the great lakes, the figures by provinces being: Alberta,
5,637; Saskatchewan, 4,783; Manitoba, 3,250; British Colum-
bia, 2,907; Ontario, 1,374; New Brunswick, 493; Quebec, 454;
Nova Scotia, 392; Prince Edward Island, 291.
The loans approved by the provinces are: Alberta, $22,-
410,192; Saskatchewan, $19,352,307; Manitoba, $13,057,770;
British Columbia, $12,437,650; Ontario, $5,931,605; Quebec,
81,884,938; New Brunswick, $1,413,684; Nova Scotia, $1,376,-
130; Prince Edward Island, $783,377. The distribution of
loans has been as follows: To purchase land, $42,778,768; to
remove encumbrances, $2,173,955; for permanent improvement,
$9,039,823; for stock and equipment, $24,555,107.
Will Increase Farm Production
Prom the standpoint of its contribution to agricultural
production the scheme is of very great importance. To date
it has resulted in the locating of 20,000 men on the soil and
under conditions so favorable that with ordinary luck they
cannot help but make good. These men have, in form of
soldier grant entries, received over 1,600,000 acres, and an-
other 500,000 acres through the exercise of their civilian right,
or a total of over 2,100,000 acres. It is also to be remembered
that less than one-half of those qualified have been placed.
Now, 2,100,000 acres sown to wheat and yielding 16 bushels
per acre, which was the average for all Canada this year,
would produce over 33,000,000 bushels of wheat, an amount
equal to the spring wheat yield for all Canada in 1900.
It may also be pointed out that this average is greater
than that under crop in the whole of the maritime provinces
as late as 1914.
The value of this settlement may also be stated in another
very striking way. The C. P. R. estimates that the yearly
value to the railways of the average farmer settler in the
west is $746.33, this figure being obtained through dividing
the number of farmers in the prairie provinces into the rev-
enue derived from the movement of agricultural produce, also
coal and in-and-outgoing passenger traffic. Capitalized at BV,
per cent. $746.33 is worth $13,569.63, which, the C. P. R. con-
cludes, is the value of each western farmer to the country. In
this basis of calculation these 20,000 farmers placed through
the soldier settlement board should be worth $270,000,000 to
the country. If all those qualified go on land the value of the
total settlement to the country should equal half a billion dol-
lars.
Returned Soldiers' Insurance
Among other legislation of the session was the Returned
Soldiers' Insurance Act, which came into operation on Septem-
ber 1st, 1920. It applies to returned soldiers and to the
widow of a returned soldier who died after honorable dis-
charge from service and before September, 1921. Policies
are issued for a minimum of $500, and in multiples up co
$5,000. The insurance money is payable only at death or on
permanent disability of the insured, the maximum amount
paid in one sum being one-fifth of the amount of the insur-
ance, the remainder being paid in annuities. The insurance
must be applied for before September 1st, 1922. The amount
of such insurance in effect at the beginning of November was
$2,203,000, the number of policies issued being 649.
The tariff commission, consisting of Sir Henry Drayton,
chairman, Hon. J. A. Robertson and Hon. Dr. Tolmie opened
its sessions in Winnipeg on September 18th, where represcnta-
ti\"es were heard chiefly from the Canadian Manufacturers'
Association and the Grain Growers. In the west sittings were
also held at Medicine Hat, Vancouver, Victoria, Vcmon, Nel-
son, Trail, Calgary, Edmonton, Saskatoon, Rcgina and Bran-
don; also at Port William and Port Arthur, and Sault Ste.
Marie. The eastern itinerary opened at Charlottetown on
November 4th, other places visited being Sydney, Halifax, St.
John, Moncton, Quebec, Sherbrooke, Three Rivers, Montreal,
Kingston, Hamilton, London, Windsor and Toronto.
Results of New Taxes
The new taxes, together with the more vigorous and effi-
cient collecting of the income tax, have produced abounding
revenues so far during the current fiscal year. Very gratify-
ing indeed have been the returns from the luxury and sales
taxes, these, with a i-eduction in expenditure, having enabled
the finance department to report at the end of October a reduc-
tion of $2,634,356 in the net national debt during the month.
The receipts from the luxury and sales taxes, which are in-
cluded under the item internal revenue, were $38,985,991 for
the seven months ending October, an increase of $30,870,000
over the returns for the same period in 1919. During October
they were $9,534,178, as compared with $1,045,708 in the pre-
ceding October. The reduction in the business profits tax is
showii in the reduced collections, which amounted to $16,889,-
720 for the seven months, compared with $17,787,975 for the
preceding seven. The income tax collections were $7,297,512,.
compared with $1,946,419. For October alone they were $712,-
093, against $272,691 for the same month last year. The cus-
toms collections for the first six months of the fiscal year ran
over $24,000,000 ahead of those for the same months in 1919,
but in October they began to fall behind. Up to October 31st
the total revenue for the fiscal year was $256,576,967, com-
pared with $186,408,794 for the same period in 1919.
At this rate the revenue for the fiscal year would -amount
to $437,000,000, and it is quite possible that this amount may
be realized. Certainly $400,000,000 seems to be within reach.
The customs revenue has been surprisingly high, the average
for the first seven months being $17,546,000 a month, which, if
maintained, would mean over $200,000,000 for the year. When
he announced the abolition of the 71/2 per cent, customs war
tax Sir Henry Drayton expressed the view that the collections
might be $160,000,000 for the year. That they have so ex-
ceeded expectations has been due to the unexpectedly heavy
importing, especially from the United States.
These revenue figures makes those of pre-war days look
small. In the fiscal year 1912-13 the total revenue was but
$168,690,000 and constituted the record up to after the out-
break of the war. The revenue for this year will exceed that
by more than two and one-half times. Nor can it be said that
the present revenue occasions hardship. As an evidence of
how the per capita revenue has increased it may be pointed out
that in 1868 it was equal to $4.05 per capita; in 1878, $5.49;
1888, $7.66; 1898, $7.80; 1908, $14.80; 1918, $30.35; 1920-21.
probably $44.
The department of finance made a praiseworthy departure
during the year in altering the balance sheet by eliminating a
number of "inactive" assets, or assets of a doubtful character
It is true that in doing so the net national debt was increased
by well on to $300,000,000, but there was nothing to be gained
by including among the "active assets" a number of loans xo
railways that had been taken over by the government. The
net national debt now stands at approximately $2,275,000,000.
and the gross at approximately $3,045,000,000.
Canada-West Indies Trade Agreement
The Canada- West Indies trade agreement was negotiated as
a result of a conference held during June between representa-
tives of Canada and the Bahamas, Barbados, Bermuda, British
Guiana, British Honduras, Jamaica, Leeward Island, Trinidad
and the Windward Islands. By it Canada affirmed the princi-
ple of granting a preference on all goods the product or manu-
facture of any of the foregoing colonies imported into the
Dominion which are subject to duty, or may be subjected to
duty at any future time, and the colonies reciprocated. The
THE MONETARY TIMES
Volume 66
duties on all goods, other than tobacco, cigars, cigarettes, spir-
ituous or alcoholic liquors, are not to be more than 50 per
cent, of the duties imposed on similar gpods imported into
Qanada from foreign countries, special ti-eatment being grant-
ed to sugar imported from the islands. Subject to certain
special provisions, the duties on all dutiable goods other than
tobacco, cigars and cigarettes, which are the product or manu-
facture of Canada, shall be imported into the colonies accord-
ing to the following preference: In the case of Barbados, Brit-
ish Guiana and Trinidad, 50 per cent.; British Honduras, the
Leeward Islands, and Windward Islands, 66% per cent.; Ber-
muda and Jamaica, 75 per cent.; Bahamas, 90 per cent, of the
ordinary tariff rate. Special provision was also made for the
establishing of direct mail, passenger and freight steamship
service between Canada and the British West Indies. The
treaty is subject to the approval of Parliament and of the
legislature of each of the colonies and of the colonial secre-
tary. All the colonies have ratified it. It will remain in
force for ten years after proclamation of it and be terminable
on twelve months' notice.
Wide Fluctuations Shown in Employment
Very Little Unemployment in Summer Months, But Rapid Increase in Fall-
Seasonal Fluctuations Greatest in Prairie Provinces, Proportion of Applicants
to Vacancies Grows — The Work of the Employment Service of Canada
By BRYCE M. STEWART
Director, Employment Service of Canada
IN 1919 a nation-wide employment service was established in
Canada by the Dominion and provincial departments of
labor in co-operation. In this Canada anticipated the recom-
mendation of the international labor conference that "Each
member which ratifies this convention shall establish a system
of free public employment agencies under the control of a
central authority." At present there are 75 offices in oper-
The service regards the placing of applicants in employ-
ment and the recruiting of employees for employers as a local
problem in the first instance. If, however, the local office is
unable to fill all its orders or place every applicant in its own
zone of operations the surplus of demand or of labor is re-
ported to the clearing house of the province. The provincial
clearance officer is constantly receiving these reports of aver-
PERCENT
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ation, distributed among the provinces as follows: Nova Scotia
4, New Brunswick 1, Quebec 5, Ontario 27, Manitoba 9, Sas-
katchewan 9, Alberta 5, British Columbia 15. For the 11
months ended November 20, 1920, the number of vacancies
notified to the offices of the employment service was 452,293,
of which 394,710 were for men and 57,583 were for women.
Applications for employment for this period numbered 450,-
544, of which 407,422 were received from men and 43,122 from
women. The placements of men were 314,981, and of women
27,529, a total of 342,510. In addition 73,803 casual place-
ments were effected. The total placements for the calendar
year will be approximately 450,000.
ages and circulating them in clearance bulletins throughout
all the offices of the province. Frequently a local superinten-
dent is able to match his surplus of carpenters, for example,
with an unsatisfied demand for these tradesmen in some other
locality. He communicates by telephone or telegraph with
the other superintendent concerned and arranges a transfer
if both parties are satisfied.
After demand and supply have been ironed out in this
way as smoothly as possible over the province the provincial
clearance officer reports any orders for employees or applica-
tions for employment still unsatisfied to the Dominion clear-
ing house of the district — at Winnipeg for the west, at Ot-
January 7, 1921
THE MONETARY TIMES
tawa for Ontario and Quebec, and at Moncton for the mari-
time provinces. Tlie Dominion clearing house circulates these
items among employment offices in adjacent provinces, or if it
seems desirable in all the remaining offices of the country.
As before, the local superintendents are authorized to com-
municate directly with one another in arranging to transfer
persons to satisfy orders in interprovincial circulation.
Reduced Railway Rates
■ To assist the service in this clearance work a special
transportation rate for persons being sent to employment at a
distance has been granted by all the large railways. Under
this transportation arrangement a reduction from the regular
fare is granted on all trips of 116 miles or more, a flat rate
of $4 being charged on trips from 116 to 177 miles, and a rate
of 2¥i cents per mile on trips of more than 177 miles. Re-
duced fares are granted to applicants on presentation of a cer-
tificate signed by the superintendent of the local employment
offices. The certificate is granted, of course, only in cases of
bona fide placements through the employment service. The
rate presupposes the existence of a well-organized system of
provincial and interprovincial clearance to insure that persons
will not bo despatched long distances when suitable employ-
ment is available near at hand. The importance of this re-
duced fare plan in enabling the service to secure employment
for persons who would otherwise be out of work, and at the
same time to increase production, can scarcely be over-empha-
sized.
Relation of Employment to Industry
The reports of applications, vacancies and placements
received from the local offices afford a valuable index of labor
market conditions and the accompanying chart is of some in-
pLRCEIiT/qGEl CH/^NGE IM MUnBER OF PER50N5 ON P/qv'-ROLLS, /^5
REPORTED WEEKLY bY EHPLOYERS NflKING RETURNS FOR CflNflDfl,
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AUG. SEPT. OCT.
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THE MONETARY TI
E S
Volume 66
terest from that standpoint. It shows that from March 1,
1919, when the statistics first became available, until the last
week of July, the spread between the supply of labor as indi-
cated by applications for employment and the demand for
labor as evidenced by employers' orders was never very
great. The supply, as would be expected, was somewhat in
excess of demand in the early spring but demand was slow co
overtake supply and it was not until the end of June that the
number of workers required was in excess of the applications
for employment. Industry had not completed the change
from war to peace production and as demobilization threw
thousands of men on the labor market the usual spring absorp-
tion was delayed. Indeed it was not until the heavy demand
for labor for the western harvest that demand rose above
supply pronouncedly. During the autumn orders for labor
kept up very well and a surplus of labor was not registered
until the second week of November, with the release of num-
organized. Reports of the number of persons on pay-rolls are
received weekly from 5,000 industrial enterprises employing
about 700,000 workpeople. Assembled by industrial groups
they constitute a very good barometer of the employment sit-
uation in industry. The accompanying chart shows the
change weekly in the number of persons employed since the
base week — January 17 — as reported by employers making
returns from Canada as a whole, and by districts. It had been
planned to use the first week of the year as a base, but this
was found impracticable because of the annual holiday and
inventory-taking period which occurs at that time. The per-
centage change rather than the actual number of employees
is used in plotting the curve for the reason that the number
of returns received weekly is not constant.
Taking the reports for all Canada the curve for the first
few weeks shows the recovery from the holiday season, but
from the middle of January until the 1st of April it remained
bers of men from railroad and construction operations and
from farm work.
Recovery Last Spring
All through the winter until the end of March, 1920, the
iniployment service carried a surplus of applicants on the reg-
isters, a peak being reached early in January when the regis-
tration of unemployed ex-service men for the federal emerg-
ency appropriation was heaviest. In the spring of 1920, how-
ever, recovery from the winter slackness was much earlier
than in 1919, the curve of demand rising above the curve of
supply about the 1st of April, as compared with the end of
June in the previous year. The demand for labor for the
western harvest was also somewhat heavier than in 1919 and
in the record week of the harvest season, as well as of the
year, 17,500 placements were effected as against 13,500 in the
corresponding week of the year previous. Evidence that we
are entering upon the winter of 1920 with a lesser volume of
emplojTiient than at the beginning of last winter is afforded
by the fact that in 1919 the demand as represented by vacan-
cies did not make a final crossing to a position below supply
as indicated by applications until the second week in Novem-
ber. This year the crossing took place in the second week of
October, just one month earlier.
Weekly Employment Reports
During the year a system of weekly employment reports
from representative employers of labor in all industries was
almost horizontal. During this period railway and other con-
struction work, which bulks so largely in the industry of the
west, was at its low level for the year, a fact which exerted a
strong bearish influence on the curve of employment for Can-
ada as a whole. With the advent of the usual spring expan-
sion in out-of-door work the volume of employment grew rap-
idly until a peak was reached in the middle of July, when the
number of employees on the pay-rolls was 9 per cent, greater
than at the middle of January. The various curves show that
this expansion was common to all parts of Canada, but very
marked in the prairie provinces and British Columbia, where
many thousands \vere drafted into railway and general con-
struction. The curve for the maritime provinces, partly due
to an unusual volume of construction work, was steepest of all.
The curve for the province of Ontario and Quebec closely
parallels the curve for the whole country, due, of course, to
the large proportion of the total industrial population within
these two provinces. The recession from the peak in July is
accounted for mainly by the numerous separations from indus-
try and especially from construction work on the part of work-
ers going to the harvest fields", a movement which appears in
the curve for the prairie provinces and also in the curve for
Ontario and Quebec. With the conclusion of the harvest the
workers returned to industrial employment in large numbers,
especially in the west, where the fine open fall favored rail-
way and other construction. At the middle of November in-
dustrial workers in the prairie provinces were still very well
January 7, 1921
THE MONETARY TIMES
19
employed, but the employment curve for the country as a whole
had dropped to the position it occupied on May 1. The curve
for the maritime provinces was keeping up very well, but the
curve for Ontario and Quebec was falling rapidly because of
the slump in various manufacturing industries, chiefly cloth-
ing, boots and shoes, rubbei-, some branches of textiles, furni-
ture, pianos, automobiles, confectionery and sugar refining.
The rapid fall in the curve for British Columbia reflects
shrinkage in railway construction, lumbering and logging op-
erations and shipbuilding.
Trade Unions Also Report
Reports from trade unions as to the number of members
unemployed are indicative of labor market trends for skilled
workers in particular. Returns are received for the last day
of each month from some 1,500 unions with a membership of
approximately 200,000. As the accompanying chart shows
unemployment among trade unionists fell to an almost irreduc-
ible minimum during the war — less than 1 per cent, in the
summer of 1918. After the armistice the cessation of war in-
dustries, added to the unusual winter dullness, brought the
trade union unemployment curve in February and March, 1919,
to 5.6 per cent. — the highest percentage of unemployment re-
ported since the winter of 1915-16. The usual spring expan-
sion was somewhat retarded, but in the summer months only
slightly over 2 per cent, of the members were reported unem-
ployed. The curve mounted rapidly from the 1st of October
to the 1st of December, when an unemployment percentage of
5 was registered, but it dropped to 4 per cent, in January and
February, 1920. Not only was the unemployment curve lower
than in the previous winter, but improvement began earlier,
and in the months of March, April and May an unemployment
percentage of about .3 was reported, as compared with consid-
erably over 4 in the spring of 1919. While there was more
rapid recovery from winter slackness than in 1919, trade
unionists were not as well employed in the summer as in the
previous year, and at the end of- August the cui've registered
an unemployment percentage of 4. There was some recovery
in September, but by the end of October the curve had risen
steeply to 5.7 per cent., which brings us into the high altitude
attained in February and March, 1919, when demobilization
combined with seasonal inactivity to force the curve sharply
upwards. Unemployment among trade unionists in the cloth-
ing, boot and shoe and rubber industries in Ontario and Que-
bec, and in shipbuilding and lumbering in British Columbia,
was chiefly responsible for the steepness of the curve. Slack-
ness among the carpenters and joiners also contributed.
1920 A Year of Wide Changes
The various indices of employment maintained by the
employment service agree that 1920 was a year of early rise
and rapid fall in the labor market. The year 1919 was
weighted with the demobilization problem and it was mid-
summer before industry seemed to get under way. As if to
compensate for this tardiness the demand for labor continued
brisk into the late autumn and at the end of the year there
was no heavy surplus. The year 1920 accepted this heritage
blithely and gave promise of a twelve-month of activity. The
winter dullness passed off quickly. The number of ex-service
men registered for the federal emergency appropriation was
much smaller than had been expected. The percentage of
trade union members unemployed averaged only 3.5 for the first
four months of the year as compared with 5 per cent, in the
first four months of 1919. Demand for labor at the employ-
ment offices began to exceed the supply about the 1st of
April, two months earlier than in the year previous. Reports
from employers indicated expansion in the volume of employ-
ment beginning early in April and reaching a peak in July;
and building permits in 35 cities, which have not been dis-
cussed because of lack of space, registered their largest
monthly total of the year in April, $15,333,183, as compared
with a record of $11,995,683 for 1919. which was not recorded
until September. But the year 1920 was riding for a fall.
In July the curve of unemployed trade unionists registered a
higher percentage than in the previous year and in each
month following it has exceeded the 1919 mark. A surplus
of labor began to appear in the autumn, and applications for
work at the employment offices i-ose to a position above vacan-
cies offered by employers the second week of October, a month
earlier than last year. The employers' weekly reports show
that despite buoyancy in the prairie provinces the volume of
employment for the whole country has been shrinking
steadily since the last week in September, and in that month
the value of building permits fell below the figures for 1920,
and has so remained. The number of unplaced applicants on
the registers of employment oflSces is steadily increasing while
the number of unfilled vacancies has been declining at the
same rate.
It is now abundantly evident that 1919 was only the first
phase of readjustment from war to peace. Since midsummer
there has been much business unsettlement and many indus-
tries have been reducing staff's. To this unemployment will
be added that consequent upon seasonal inactivity, and we
must expect a volume of unemployment greater than that of
the winter of 1915-16.
BRITISH EMIGRATION TO CANADA RESUMED
Figures Show Big Increase During 1920 . — Movement From
United States Keeps Up
IMMIGRATION to Canada in 1920 was substantially in ex-
cess of 1919, as the figures on page 22 show. In the fiscal
year ended March 31 last 117,336 came to Canada, of which
59,603 were British, while for the previous year the figures
wei-e 57,702 and 9,914 respectively. During the seven months
ended October 31, 1920, 109,856 came to Canada, 60,370 being
British, 34,708 from the United States, and 14,778 from other
countries.
Falling Off in Autumn
In commenting on the movement, W. D. Scott, Dominion
superintendent of immigration, said to Tlie Monetary Times:
"It will be noticed that immigration to Canada during the
seven months ended October 31st of this year shows an in-
crease of 32 per cent. For the last three months of the period,
however, as compared with the corresponding months of the
preceding year, the increase is quite small. In view of the
fact that an order-iri-council of recent date, fixing the money
qualification for adult males at .$250, for adult females at $125,
and for children at $50 each, the same to become effective at
border ports on the 15th inst., and at ocean ports on the 1st
prox., it may perhaps be concluded that for the five months,
November to March, the number of immigrant arrivals may
not be expected to show any increase over the corresponding
months of 1919-20. If no falling off results the figures for
the fiscal year 1920-21 will he approximately 144,000, or about
23 per cent, increase as compared with that of 1919-20."
Movement from Across Border
In recent years the number of immigrants coming to
Canada from the United States has been greater than the
number moving in the opposite direction. A report of the
United States commissioner of immigration for the six months
ended June 30, 1920, says : "In the movement of United States
citizens to and from Canada, the balance is in favor of the
latter, for during the past ten years nearly 562,000 have gone
there and about 367,000 have come to the United States."
Figures showing the movement of immigrants between
the two countries show 329,316 going from Canada to the
United States in the five-year period 1910-1914, and 605,498
from the United States to Canada in the same time. In the
period 1915-16-17 289,165 persons left Canada for the United
States, while 158,105 came to Canada from the United States.
United States immigration officials say this was largely
due to the fact that the United States had not entered the war
at that time and there was unusual prosperity in that country.
Many former Americans were returning from Canada to work
in factories because of the higher wages offered. In 1918 and
1919, with the United States in the war, the situation was get-
ting back to normal.
THE MONETARY TIMES
Volxime 66
1920 a Record Year in Canadian Trade
Total Exceeds 1917 Figures— Adverse Balance Probably $85,000,000— Imports
Increased By Over $400,000,000, While Exports Stationary — Foreign Trade
Showing Good in Face of Changing Conditions— Exchange and Its Effects
By W. G. GATES
CANADA established a new trade record in 1920. The offi-
cial figures for the year are not yet available, but one is
warranted in saying that the value of the total external trade
is approximately $2,635,000,000. Until now the year 1917 with
$2,599,499,000 held the palm; but this has been beaten by
nearly $40,000,000, while the figures for 1918, the year in
which Canada was sending immense quantities of food and
munitions to Europe, have been left behind to the extent of
nearly $450,000,000. Canada did about $300,000,000 more
trade with the United States than she did in 1919; about $40,-
000,000 less with the United Kingdom, and probably $170,000,-
000 more with other countries.
The value of the exports is approximately $1,275,000,000
and that of the imports approximately $1,360,000,000, leaving
an excess of imports amounting to probably $85,000,000. How-
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ever, there is this to be taken into account: Canada has large
quantities of food to sell, and as other countries need these,
exports should at least equal if not exceed imports on the
whole fiscal year.
Per Capita Trade Very High
It is worth noting that the total trade for the year ex-
ceeds the net national debt by probably $400,000,000 ; it is over
two and one-third times greater than it was for the best year
before the war, and is equal to about $300 per capita. What
this really means is more cleai'ly realized when compared with
the per capita trade of the United States, which for 1920, ac-
cording to the best available figures, amounts to $132. In
point of turnover there is every reason to be satisfied with
1920, for in no other calendar year has Canada done as large
a per capita trade. It should also be borne in mind that these
huge figures wei-e rolled up in spite of rapidly declining prices.
Exports Have Fallen Off
While the total figures are thus much larger than ever be-
fore, it is regrettable that the exports show a slight decline,
for they amount to approximately $1,275,000,000, as compared
with $1,294,830,372 in 1919, and $1,243,727,769 in 1918. But
the situation is not as unfavorable as the comparative figures
might lead one to conclude. Though the figures for exports
are lower, they are nearly equal to 55 per cent, of the net
national debt. That they are lower than those for 1919 is due
inerely to the marked decline in grain prices during recent
months. Canada has 100,000,000 bushels more of wheat this
year than last for export, which means possibly $170,000,000
more in exportable values; and in the next few months it will
swell the export figures. So while returns for exports may
lower the potential value of this department of the nation's
trade is much higher than it was in either 1919 or 1918, and
that in spite of lower prices. It is furthermore to be taken
into account that the decline has been in foreign produce,
so that the exports of Canadian produce have remained
nearly stationary.
Much has been said about the decline in exports, but the
real gains made by exports should rather have commanded
attention. During the twelve months the value of commodi-
ties exported exceeded by $100,000,000 the value of all muni-
tions exported during the four years of war. It was also equal
to three-fourths of the national war expenditure. That a new
record was not established is easily explained. During the
year, owing chiefly to the rate of exchange and to the further
fact that many of the countries of Europe are now drawing
from other sources commodities fonnerly taken from Canada,
exports to the United Kingdom and France fell off to the ex-
tent of probably $200,000,000 during the year, of which pos-
sibly $170,000,000 is represented by reduced exports to the
United Kingdom. Among other things there was a loss of
$100,000,000 in munitions.
Strong Spots in Export Figures
This has been partially made up for by an increase of
nearly $100,000,000 in exports to the United States. That,
taking into account this serious loss of expoi'ts to Europe and
the decline in prices, the exports are so nearly equal to
those of last year, while much greater quantities of grain at
good prices remain to go out, is strong proof that, all things
considered, the export trade of Canada is in a satisfactory con-
dition.
In passing a word should be said on the recuperative
powers of the export trade manifested during the last two
years. In 1917 the exports of cartridges and other explosives
were valued at $435,000,000; in 1918 they were $273,000,000;
even in 1919 they exceeded $100,000,000; but in 1920 they
dropped to less than $2,500,000. Notwithstanding this serious
loss the industries of the Dominion, engaged solely in peace-
time production, last year turned out for export a volume of
commodities much exceeding in value that of 1918, when
Europe was paying Canada famine prices for almost any
product. For this recovery credit is due chiefly to the agri-
cultural and to the pulp and paper and lumber industries. The
pulp and paper exports for the year are estimated at $175,-
000,000, as compared with $70,661,000 in 1918, and $86,996,371
in 1919. Indeed, the progress made by this industry, reads
like a fairy tale and merits special attention.
In the fiscal year 1913 the value of pulp and paper exports
was $11,837,344. The advance to $58,753,906 for the calendar
year 1917. and to $86,966,371 in 1919 was surprising, but it re-
mained for 1920 to give a remarkable demonstration of growth.
In April the value of these exports was $8,172,356, but in Sep-
tember it had jumped to $18,224,356; that is to say, the value
increased by 120 per cent, in six months. In September alone
the value of pulp and paper exported w-as within $800,000 of
that for the whole of the fiscal year 1914. It is said on good
authority that last year Canada produced 75,000 tons more of
pulp and paper than Noi-way, Sweden and Finland combined.
January 7, 1921
THE MONETARY TIMES
Moreover, this is a permanent industry insofar as the present
generation of Canadians is concerned. This remarkable dem-
onstration of recuperative power when many good judges ex-
pected a collapse imparts confidence for the future.
Exchange Affects Trade Figures
Paradoxical as the statement may seem to be, it is never-
theless true, that insofar as exports to the United States are
concerned their real value to the country is not disclosed by
the trade returns, for while they were nominally valued at
probably $600,000,000, the rate of New York funds, which
ranged at 12 per cent, during the year, increased the returns
to the Canadian exporters by approximately $70,000,000 — that
is to say, these exports were really worth over $670,000,000 to
the country. On the other hand, imports from the United
States are not always increased in value by an amount equal
to the rate of exchange, for it must be remembered that in
order to hold their trade a very large number of American
firms divide the premium with their Canadian customers, while
some, indeed, bear it entirely.
In comparing the export trade of 1920 with that of 1919
and 1918 it must also be taken into account that only a small
portion of the business done during the year just closed was
obtained through government credits, or through long ad-
vances made by the banks, but rather on such terms as are
usually granted in the ordinary run of commercial transac-
tions. But not so the business of 1918 and 1919, a large part
of which was secured through liberal government credits, for
during the war period the aggi'egate advances extended to
allied governments probably reached $1,100,000,000, to which
should be added bank credits exceeding $200,000,000.
Compared with that of the United States the export trade
of Canada during 1920 was very creditable. The exports of
the great republic for the year are estimated at $8,000,000,000,
a new high record. But this is only $75 per capita, whereas
Canada's exports were probably $140 per capita. In other
words, the per capita export trade of this country during 1920
was 85 per cent, greater than that of the United States. Be
it also remembered that this huge American export trade is
sustained by nearly $4,000,000,000 of private credits. Had
such credits been at the disposal of Canadian trade 1920 would
have left all previous export figures far behind.
Large Increase in Imports
Imports took a long leap forward during the year, being
valued at approximately $1,360,000,000, an increase of approx-
imately $420,000,000 over the preceding year, and nearly $450,-
000,000 over 1918. In 1920 the imports were at the rate ol
$115,000,000 a month, whereas in 1919 the rate was but $104,-
557,000, and in 1918 $76,000,000. The increase may be attrib-
uted chiefly to the removal of the 7% per cent, customs war
tax and to the practice of Taluing imports from countries,
whose currency as compared with the Canadian dollar is de-
preciated, at the current rate of exchange. The imports from
the United States were approximately $930,000,000, or at the
rate of about $78,000,000 a month. This means that Canada
imported $200,000,000 more of commodities from the republic
than she did in 1919. Imports from the United Kingdom
show the lai'gest percentage of increase, 110 per cent., though
the increase in dollars is but a little over $150,000,000, the fig-
ures being $240,000,000, as compared with $87,651,725.
As an evidence of not only the value, but of the rapid
growth of trade with the United States, it may be pointed out
that the increase alone in imports during 1920 was within
about $40,000,000 of the value of all imports from the United
Kingdom. This was piled up in spite of the rate of exchange,
which operates to retard purchases from the Republic, while at
the same time it stimulates imports from the United King-
dom. During the year the value of imports from the United
States was probably equal to the value of all imports from all
countries in any previous calendar year. Ten years ago the
imports from all countries were only valued at $.370,000,000.
That, in spite of the obstacle, these imports increase so rapidly
is due undoubtedly to the fact that Canada is now drawing new
capital almost entirely from the United States, a large portion
of which necessarily enters in the form of impoi'ts, and to
stronger efforts in both countries to promote international,
financial and commercial relations.
Influence of Exchange Rates
The influence of the rate of exchange on e.xport trade was
more marked during the year than ever before. Among other
things it has made the United States Canada's best customer,
the United Kingdom having taken second place. Canada had
so increased lier exports to Europe during the war period and
her name stood so high among the nations of that continent
that prospects for the continuance of this trade seemed very
bright, and confident predictions were made by some of the
best-informed over the importance of this new trade outlet.
But in general these predictions were made without due regard
to the influence of exchange after the pegs had been removed
from sterling in New York. During the past year the effect
has been most apparent. As has already been noted, exports
to the United Kingdom and the continent of Europe declined
to the extent of over $200,000,000. The reason is obvious, for
with sterling at a discount ranging from 10 to 20 per cent, in
Canada, and with the currencies of other countries in Europe
subjected to an even greater discount, they cannot aff'ord to
buy here any more than is absolutely necessary.
On the other hand, the rate of exchange which has re-
duced exports to these countries has strongly stimulated them
to the United States, the gain having been equal probably to
at least $100,000,000 during the year. So that much of what
has been lost in trade with Europe has been regained with the
Republic. 'Wbile possibly 30,000,000 bushels of wheat were ex-
ported to the United States, which may be attributed almost
solely to the absence of a strong direct demand from the
United Kingdom, the increase was due largely to the heavy
demand for pulp, paper and lumber, and the higher prices
which these products commanded over other years. It is un-
doubtedly true, however, that the whole range of commodities
that could be sent south was strongly afi'ected by the premium
on New York funds, which made the American market by far
the most profitable of any outside of the country.
The change of direction taken by so large a portion of
Canada's export trade is of major importance. Only four
times since 1873 has this occurred, namely, in the fiscal years
1882, 1888 and 1889, and during the last calendar year. In the
years immediately preceding the outbreak of war the United
Kingdom was taking from $30,000,000 to $60,000,000 worth
or commodities more than from the United States. In 1915-
16 this excess was $250,000,000; in 1916-17 it was $465,000,000;
in 1917-18 it was $421,000,000, and in 1918-19 it had dropped
to $83,000,000, and in the calendar year 1919 to $46,000,000.
THE MONETARY TIMES
Volume 66
IMMIGRATION INTO CANADA, 1919-20
(Figures furnished to " The Monetary Tinics " by Mr. W. D. Scott, Superintenileni of Immigration. Ottawa.)
Statement of Immigration to Canada during the Fiscal Year 1919-20, compared with that of 1918-19.
United
Stales
1!)19
A!'..l
-Mav
lune
July
August
September .
October
November . . .
December. . .
1920
January
Februar\- . . .
.March..'
Totals...
4. 'id
6,310
209
4,. 554
i:u
3,277
30-1
2,719
199
3,610
2.S-_'
2,835
616
634
1,810
1,170
3,442
2, 194
1,796
2,226
2,085
2,641
6,46S
Other
Countries
383
438
461
444
706
344
626
799
576
805
753
7,073
7.123
5,261
3,895
3,468
4,515
3,461
3,436
3.195
3,436
4,633
4,616
10,663
57,702
191920
Percentages
of
Increase
irilish
United
States
Other
Countries
Totals
and
Decrease
Increase
3,244
7,524
5UU
11,268
58 per cent.
4,534
5,198
465
10,197
94
2,601
4,707
505
7,813
101
5,998
4,450
629
11,077
219
9,428
5,149
583
15,160
236
7,792
4,852
775
13,419
288
9,394
4,069
949
14,412
319
4,594
2,772
708
8,074
153
3,244
2,149
908
6,301
83 •■
2,089
1,665
465
4,219'
- 9 per cent.
2,008
1,951
638
4,597
4,677
5,170
952
10,799
1
)9,603
49,656 /
8,077
117,336
103%incre'se
Statement of Immigration to Canada, during the period, April to October, 1920, compared with that of the corresponding months of 1919.
1920-21
Month
April 3,244
-May 4,534
June 2,601
July 5,998
August 9,428
September | 7,792
October I 9,394
Totals 42,991
1919-20
United j Other
States Countries
Totals British
United Other
States Countries
7,524
5,198
4,707
4,450
5,149
4,852
4,069
35,949
500
465
505
629
583
775
949
11,268
10,197
7,813
11.077
15,160
1.3,419
14,412
6,229
12,414
9,844
10,472
7,404
6,405
7,602
6,324
5,353
4,720
4,.S01
5,838
4,227
3,945
83,346
60,370
734
1,844
1,780
1,888
2,510
2,718
3,304
14,778
13,287
19,611
16,344
16,661
15,752
13,350
14,851
Percentages
of
j 18 per cent.
I 92
109
50
I 4
109,856 I 32 per cent.
HOMESTEAD ENTRIES IN CANADA, 1898-1920
Years
Total entries
Entries by
English
Entries by
Scotch
Entries by
Irish ,
Entries by
Americans
Entries by Conti-
nental Immigrants
Calendar Year
1898
4, ,848
489
161
75
581
1,270
1899
6.689
578
192
97
1,064
1,796
•1900
7,420
3.50
95
50
833
1,643
Fiscal Year
1901
8,167
659
182
99
2,026
1,866
1902
14,673
1,096
300
184
4,761
2,653
1903
31,383
2,816
724
336
10,942
7,260
1904
26,073
3,486
911
267
7,730
4,909
1905
.30,819
4,284
1,225
421
8,532
4,999
1906
41,869
5,897
1,657
543
12,485
5,955
tl907
21,647
3,032
807
252
6,059
2,951
1908
30,424
4,840
1 ,026
339
7,818
5,373
1909
39,081
5,649
1,310
506
9.829
7,265
1910 •
41,568
5.4,59
1,326
546
1.3,566
6.696
1911
44,479
6,161
1,291
492
13,0.38
8,793
1912
.39,151
5,739
1,041
476
10,978
9.044
1913
33,699
4,452
836
307
8,895
7,757
1914
31,829
3,894
966
400
7,293
8,139
1915
24,088
2,974
800
363
4,334
6,881
1916
17,030
2,374
700
314
2,435
3.899
1917
11,199
1.469
496
194
1,734
2,1.32
1918
8,319
888
285
142
2,094
1,094
1919
4,227
639
182
87
876
447
1920
6,732
1,2.52
360
154
1,331
.574
tl921
1 3,784
611
169
76
754
441
.Six months ended June 30th. f Nine months ended March 3Ist. J 7 months to October.
January 7, 1921
THE MONETARY TIMES
Political Leaders Discuss National Issues
Tariff is Main Subject Dealt Willi in Western Towns — Premier Meighen
Upholds Present Tariff — Mackenzie King, Liberal Leader, Advocates
Retrenchment— T. A. Crerar, Progressive Leader, Stands For Tariff Reduction
Hon. Arthur Meighen, premier of Canada, and leader of
the National Liberal and Conservative party, which succeeded
the Unionist party in July last, in a speech at Winnipeg on
October 25, at the commencement of a tour of Western Can-
ada: —
"There must be," said Premier Meighen, "such a tariff as
will make it pay Canadian industries to remain in Canada, and
make it pay industries to grow and make good Vvithin this
country. Up to that point, and not beyond that point, the tar-
iff in Canada on any class of goods should go. I ask the peo-
ple of Winnipeg, if you first of all decide that you must take
account of the needs of industry and the need of keeping them
in this country, can you possibly adopt a more restricted prin-
ciple than that? We do not intend to go further. There is
no value whatever in a tariff that does less. I did not see
how to find out what is necessary except by the most careful
and thorough enquiry that can be made. That is the course
the government is pursuing, and before the electors in this
country are asked to decide between our course and the vag-
aries of our various oppositions they will have a definite tariff
from us in black and white. By the principle I have defined,
by the limits I have clearly set out, that tariff will be con-
structed.
"If I am asked whether it will be possible to have a lower
scale than prevails to-day or not, I say that must await the
completion of the investigation. For myself, I would hope
that in the final result it would be found not to be higher, and
perhaps lower, than it is now; but I believe the interest of
Canadians of every class require that Canadian industries re-
main Canadian industries, and that Canadian industries, not
American industries grow with the growth of Canada.
"The authority of Parliament over its executive is just as
complete, just as final, just as supreme at this hour and has
been at every moment of the last six years, as it ever has been
in the history of Canada or any country on earth. There has
never been a single day when Parliament could not, by a ma-
jority vote, have voted the government from office or forced it
to a general election."
The premier then proceeded to deal with the tariff'. There
were only the tariff principles, he said — protective and free
trade. "I believe the protective principle can be abused," he
said. "I certainly believe it can be too high. I believe it has
been abused. I believe in places and at times it has been too
high, but I don't believe it can be abolished. There are many
who believe that there is little, if anything, to be lost and very
much to be gained by practically a prohibitive tariff. With
that opinion the government of Canada holds no sjonpathy,
and against the prevalence of that opinion it will stand just as
firmly as against the prevalence of the opposite opinion, the
theory of free trade. If we abandon the principle of protec-
tion we will pay a sure and heavy penalty and every class will
share in the calamity. We do not intend any. system of shut-
ting out imports. We must hold the level of our tariff down
to the minimum that will maintain fair but active competition
with industries outside.
"The big task of the next few years is the development of
the resources of Canada. Constructive plans that bring real
results in the development of our resources must be thought
out and got under way, and_policies consistent with these plans
must be pursued. Do not let the west of this counti-y get the
idea that the east must remain the business centre or even
the manufacturing centre of this Dominion. A territory that
has the coal and the ore and the mineral wealth of Western
Canada is bound to become a great industrial land."
Hon. W. L. Mackenzie King, leader of the Liberal party
in the House of Commons, in a speech at Brandon on Novem-
ber 6:—
"The real issue to-day is the big interests versus the
classes that represent the masses of the people," stated the
Hon. Mackenzie King. The parties against the present gov-
ernment are not united, and this is the strength of the present
party in power. "I have no opposition to any group in Can-
ada, but I come here to state that I am standing for a party of
progress, which will influence and add strength to any body
for progress. The time has come when those standing for
progress .should co-operate, so that when the fight does come
we can stand united against the big intei-ests."
"The greatest problem to-day is the cost of living, and
there is not a person in Canada to-day who is not affected by
it," stated the speaker. The duty of the government is to
seek some solution for the high cost of living, but up until the
present time they have done nothing. Three great policies
have been outlined in the Liberal platform, and briefly Mr.
King outlined them as (1) retrenchment of public expendi-
tures, (2) a revision of the tariff downward, and (.3) the elim-
ination of profiteering.
Dealing with the first policy, the opposition leader told
of the immense amount of money Canada had to pay each
year as interest on its national debt, of the huge expenditures
that arose out of the war and have to be met, and the expense
of carrying on the government of the country. The only solu-
tion, said Mr. King, i?o a more economical method of handling
the finances of the country is in a complete change of admin-
istration. Until we get a Parliament representative of the
people we will never get anywhere.
With regard to the tariff, the speaker said that the Lib-
erals had laid down their policy in their platform of last Aug-
ust, and by that policy the Liberal party would stand or fall.
He then read the tariff policy of the party showing the revi-
sion to be sought, and said that it was a tariff in the interests
of both the producers and the consumers. The purpose of the
custom duties was for the purpose of revenue only, and the
Liberals naturally seek freer trade. The point is that the
necessities of life should be as free as possible so that the
masses of the people can get as great quantities as they want.
The cost of living can only be reduced by increased production.
The war has destroyed wealth, and now we must make more
wealth.
Hon. T. A. Crerar, leader of the Progressive party in Can-
ada, in a speech at Prince Albert, Sask., on November 4: — •
As to the tariff", Mr. Crerar urged more attention to the
development of the basic industries rather than artificial stim-
ulation for industries asking protection. The tariff commis-
sion had gathered a mass of contradictory evidence, and the
Progressive leader advocated that any industry needing pro-
tection should place its claims in the open before a committee
of the House of Commons. He cited Great Britain's recovery
after the war as an instance of what free trade had done, as
compared with such protectionist countries as Germany,
France and Italy.
Canada had many problems before the war, said Mr.
Crerar, but the war had magnified and intensified these prob-
lems. For instance, before the war the public debt was $333,-
000,000 — now it is $2,2.50,000,000. Yet nobody in Canada be-
grudged that increase. There was also the geat problem of
taxation. History showed that it was not the amount of
taxation, but the manner of imposing taxation, which counted. -
Some criticism had been directed against the farmers' or-
ganization. The declarations of political principles laid down
by the farmers before the people were not the product of a few
men, but wei-e produced by great conventions in many prov-
inces, and in succeeding years. Yet this platform was criti-
cized as a class policy. This criticism came from those who
were interested in keeping the common people down to the
level they had been heretofore.
THE MONETARY TIMES
Volume 66
Canadian
Government and
Mnnicipal
Bonds
Victory
Bonds
Sold
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Winnipeg Toronto London, Eng.
January 7, 1921
THE MONETARY TIMES
25
Provincial Premiers Write of 1920 and Outlook
Opinions .Expressed are Optimistic of Recovery from Present Period of Depression —
Turning Point Has Been Safely Passed — Review of Year's Developments in the Provinces
NOVA SCOTIA
By
H
anorable
4.
MURRAY
P
remier.
alllllllllllllllllllllllllllllllllllllllllllllllllllllllllllll
No other portion of Canada is more prosperous to-day
than the Province of Nova Scotia. The farmers were
blest during 1920 with bountiful crops, which were harvested
in excellent condition. The apple production was exceeded
by only two other apple crops in the history of the Nova
Scotia fruit industry, and the output of creamery butter shows
a gratifying increase. While prices have declined in sym-
pathy with world-wide conditions, the end of the year finds
our farmers with a balance on the right side of the ledger.
The output of coal during the past year reached approxi-
mately 5,700,000 tons, as comp&red with 5,004,757 tons in
1919, an increase of about 14 per cent. Sales amounted to
5,082,230 tons, as against 4,459,647 tons in the previous year,
an increase cjlso of very nearly 14 per cent. The coal in-
dustry of Nova Scotia is now on a basis that will support a
largely increased production as soon as conditions will war-
rant such development.
In the lumber industry weather conditions were ideal for
operations. The total production was 350 million feet, which
is valued at $12,250,000. The cut exceeded normal by about
50 million feet. Of the total cut a-bout 90 per cent, has been
sold, and about 60 per cent, shipped, leaving about 40 per
cent, on hand. It is estimated that of the supplies disposed
of, 25 per cent, were consumed locally, 10 per cent, went to
Upper Canada, 30 per cent, to the United States, 25 per cent,
to the United Kingdom, and the remainder to the West
Indies, South America and Newfoundland.
The deep-sea fishing fleets had a- successful year, while
the production of the shore fisheries, with the exception of
lobsters, was under the average. All the branches of the in-
dustry — fresh, salt and smoked — have been carried on in
about the same volume as during the preceding year, but at
a lower range of prices. The industry, in general, is suffer-
ing from a forced curtailment of buying due to the financial
situation. It is confidently expected, however, that conditions
will improve in this industry as soon as the accumulated
stocks on hand will be cleared off.
To sum up, owing to the flourishing condition of two of
our leading industries, farming and coal mining, and the very
fair condition of the steel and other industries, it may be
truthfully stated that Nova- Scotia has again earned the right
to be classed among those countries where a certain buoyancy
of trade is maintained by virtue of the variety of its re-
giiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiijiiiiiiiiiiiiiiiMiiiiiiiiiiiiiiiiiiiyiiiiiiiiiiiiiiiiiiiiiiiiiiiiiitt^
NEW BRUNSWICK
Honorable
W. E FOSTER.
iiniiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
illlllllllllllllllillllllllilllllllllllllllllllllllllllllllllllllllllllllllllH
NEW BRUNSWICK has not been simply marking time in
1920. All classes of people have realized the import-
ance of gaining a fresh and firm foothold on business and
trade after the uncertainties that prevailed during and imme-
diately after the war period.
The greatest industry, lumbering, was followed wi.th
great energy. Enhanced prices in the later months of 1919
and the spring of 1920 resulted in increased production of
lumber and pulpwood. Wages were high and costs advanced
proportionately. Falling prices in later months have given
warnings which are being wisely heeded.
Employment is not so plentiful as it was. The cessation
of road work, in which the Province has spent liberally, has
diverted such labor to other channels. Manufacturing indus-
tries are slacking up and further diversion will be necessary.
Agricultural production was satisfactory and the prices
fairly good. Lower prices mean greater efforts on the part
of those engaged in this industry, and this, no doubt, will be
as true in the future as in the past.
In spite of these drawbacks, due to the falling prices the
world over and reconstruction efforts, there is a feeling of
great confidence in New Brunswick. The Government, of
which I am the Prime Minister, is aiding the development
of the water powers and assisting wherever possible to ad-
vance the interest and prosperity of the people. Teachers'
salaries have advanced and the profession is encouraged to
carry on with vigor and efficiency. Our bonds are selling as
high as those of any Province in Canada. Improvement in
the people's means of transportation, the highways, has been
very great. We are entering 1921 with courage, hope and
faith in our people and Province, confident that progress and
prosperity awart our united efforts.
THE MONETARY TIMES
Volume 66
gllllllllllllllllilllllllllllllllllllllllllHIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIllllllllllllllllllllllllllllllllllllllllllllllllW
BRITISH COLUMBIA
g-iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
THOUGH the wheels of some of the principal industries
have slackened within the past month or two, a com-
prehensive view shows that the yea^r to date has been on the
whole one of prosperity for British Columbia.
The great lumbering industry promises a good average
for the vear, though at present trade is quiet. Logs scaled
during the first nine months of 1920 totalled 1,400,000,000
feet as against 1,438,000,000 for the whole of 1919. The
domestic lumber market is at present very quiet, largely
owing to the advance in freight rates of September 15th last,
which discriminated against Coast shippers to the east. The
advance, being on a percentage basis, favored the southern
pine operators with their shorter haul to the eastern market.
Export shipments overseas for the year show some increase,
with 88,380,299 board feet for the first nine months as
against 72,310,130 for the same period last year. Financial
conditions in Australia, China and Japan have retarded
recent business to those points.
The pulp and paper trade continues to gain steadily, and
last year's total output of 123,000 tons of newsprint should
be surpassed. The demand for pulp and paper, and the de-
pletion of eastern pulp wood stands has turned the attention
of eastern manufacturers to the timber stands and water
powers of British Columbia. Several new pulp companies
have been incorporated and will be operating as soon as
plants can be established.
The mining industry shows satisfactory returns, though
there is naturally considerable falling off after the abnormal
activity of the war period. Such developments, however, as
that of the Canada Copper Company near Princeton, and
others in the Portland Canal district, promise well for the
future.
In the fisheries the province still holds a premier place
in the Dominion. Last year the value of the British Colum-
bia catch was estimated at 4.5 per cent, of that of the whole
of Canada. This year, owing to the lower prices for the in-
ferior grades of salmon, it will probably be smaller.
The government has been overhauling and rehabilitating
existing irrigation systems, and in the Southern Okanagan
valley is inaugurating a new system which should bring
about 7,000 acres under cultivation. All this should add ma-
terially to the future productiveness of the province.
A survey of the industries of the province as a whole
shows satisfactory progress for the present year, and
promises well for the future. British Columbia does not
carry all its eggs in one basket or all its wealth in one valley,
and "out of its varied industries of lumbering, mining, farm-
ing and fishing, is gradually accumulating a basis of sub-
stantial wealth.
■aillllllilllllllllllilllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllMIIIIIIIIIIIII^
SASKATCHEWAN
Honorable
W. M. MARTIN,
Premier
lllllllllllllllllllllllllllllllllllllllllllllllilllllllllllillllllllllllllllllllllllllllllllllllllllllBlllllllllllllllllllllllllli
IT is a great pleasui-e to be called upon to write about
Saskatchewan at this particular moment, in view of the
fact that, notwithstanding post-war conditions and disap-
pointing crops, we have never been more justified in looking
forward vi'ith confidence to Ss'Skatchewan's future, and in
this remark I am sure I can include the whole prairie country.
The budget recently presented to the Legislature by my
able colleague, Mr. C. A. Dunning, showed an excess of re-
ceipts over expenditure of ,$1,934,62.5, and a net cash surplus
of $1,801,095. In view of this surplus the Supplementary
Revenue Tax has been abolished. This tax was first levied
thirteen years ago, and consisted of a levy of one cent per
acre, one of its objects being to compel speculating owners
of unused lands to contribute to the educational needs of the
country. Since then all taxes based on acreage alone have
been replaced by an assessment on value. The last remaining
vestige of acreage taxation was the Supplementary Tax. Of
the proceeds of this tax 80 per cent, went to rural schools,
5 per cent, to the Agricultural College, 5 per cent, to the Sas-
katchewan University and 10 per cent, to secondary educa-
tion.
The public debt of the Province is on a satisfactory
footing. In a new Province the initial development expenses
were necessarily heavy. Large expenditures were absolutely
necessary in public buildings, roads and bridges, and for the
due support of education. The gross debt stands at $41,-
549,480. It is made up of two different kinds of indebtedness,
a dead-weight debt which has to be paid off from the revenue
derived from taxation, and a debt incurred for revenue-pro-
ducing utilities. This latter class of indebtedness takes care
of itself, the revenue-producing utilities paying their own
way, and fi-om the point of view of being a burden to the
State, it may be ruled out of consideration. The dead-weight
debt of the Province stood &t $19,416,237, a relatively small
amount. Without going into fui-ther detail I think I have
said sufficient to indicate that the financial position of the
Province is satisfactory; but I may add one other point which
was brought out in Mr. Dunning's budget speech, and that is
that Saskatchewan can borrow money as advantageously as
Ontario, the wealthiest Province in Canada. There is a
third liability, but it is a contingent one, of $28,582,011, re-
sulting from the Government guaranteeing C.N.R. and G.T.P.
branch line bonds, but there is little likelihood of the Pro-
vince being called upon to make the contingency good. There
are some other contingent lia^bilities on account of the Sas-
katchewan co-operative creameries, municipal hail insurance,
seed grain and drainage schemes, relief extended under
special circumstances to municipalities, and so on, but these
are not sufficient to affect the general situation very much,
as the prospects or repayment &re excellent.
January 7, 1921
THE MONETARY TIMES
MANITOBA
ALBERTA
By
Honorable
C. STEWART,
Premier
riiiiiiiiiiiiiiiiiiiiiiiwiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiinniiiiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
IN its agricultural industry Manitoba has "had still an-
other very satisfactory year, the yield of wheat over the
whole province being above the average of the past ten
years, while the coarser grains were proportionately good.
Isol&ted districts suffered somewhat from summer drought,
but on the whole, the year 1920 gives renewed confii-mation
to the declaration that "Manitoba is the Sure Crop Pro-
vince." Many years have passed since this province has had
anything in the nature of a serious crop failure, and the
possibility of such a visitation is steadily growing less as our
farmers continue to adopt proved methods in diversified
agriculture. At the moment our farmers are suffering from
the fact that while the cost of production was at its peak
during the year, the price of their product has been among
the first to be affected in the readjustment that is now well
under way. This, however, does not a-ffect the fact that
Manitoba farms are just as productive as ever, and that
Manitoba farmers are constantly improving their methods.
Conditions in the industries based on other natural re-
sources of the province have been normal. The a^nnual out-
put of our lake and river fisheries stimulated during the
war by the scarcity and high prices of beef, has remained
above pre-war figures, and will, undoubtedly, hold its present
place. Opening of transportation to the valuable fishing
grounds in our northern lakes will further increase the an-
nual yield. Lumbering, never a very large industry in Mani-
toba, shows a satisfactory increase, while our large tracts
of pulpwood remain as yet untouched; they await the open-
ing up of our far northern stretches with their natural riches
such as can only be guessed until they have been properly
prospected. Mining in northern Manitoba is now apparently
on the very eve of the long-expected development.
During the past five years there has been a large ex-
penditure for good roads, extension of the telephone service
and completion of the new legislative buildings of the pro-
vince. By careful management the financial position of the
province has been strengthened, and the credit of the pro-
vince has been ret&ined at high levels. The government has
safeguarded zealously, not alone the credit of the province,
but the credit of the municipalities and the school districts
as well, with results that speak for themselves. During 1920
thei-e was established the Provincial Savings Institution, the
people of the province being invited to deposit their savings
with the government. A beginning has thus been made
towards securing eventually within the bounds of the province
itself the money for ca^pital requirements. In this connection
it must be noted that the people of Manitoba feel that the
justification of the claim of the province for control of its
minerals, timber, water powers, fishei-ies and other natural
resources should be recognized and established.
SEEDING opened later than usual, but under very favor-
able conditions. During the fall of 1919 and the winter
and spring of 1920, a generous supply of moisture saturated
the soil, producing excellent seeding conditions. As usuaJ,
seeding began first in Southern Alberta and went forward
more rapidly than in the north, where heavy rains in the last
half of May delayed seeding to a point that made farmers
anxious for a time. The lateness of the season, however, wa-s
soon compensated for by a rapid growth. The seed quickly
rooted and grew with great luxuriance, owing to steady heat
and moisture throughout the summer.
One of the most satisfactory features of the season was
the phenomenal growth of grass. The scai'city of feed in a
large portion of the province during the winter induced the
farmers who had large supplies of feed (especially in Central
and Northern Alberta) to sell below their normal needs.
Coupled with the lateness of the spring, this feature in the
general situation caused our farmers many anxious days, but
with the beginning of the grf'ss the country quickly recov-
ered and the feed famine was forgotten in a few weeks. The
universal expression of satisfaction by all livestock men was
"How Alberta can come back."
The scarcity of feed and the cost of tractor supplies in-
creased the cost of seeding operations and limited the acreage
of whe&t. Successful efforts were made, however, to in-
crease the acreage of feed grains. The favorable ripening
season which continued into October resulted in a most
bountiful harvest of oats and barley. It is regrettable, how-
ever, that the farmer has not benefited by the increased pro-
duction. By the time his crop was ready for market, prices
had so declined that he has had an inadequate reward for
a year of anxious and costly toil. He is left wondering why
the price of his commodities has so rapidly declined while
those he is forced to buy (though they contain many raw
materials produced on the farm) still cling to unapproach-
able levels.
Such a situation is not very encouraging to increased
production for the coming year. Alberta farmers, however,
are not dispirited. More fall plowing has been done and
more land is ready for seeding next spring than for several
years p&st. As an evidence of the unbreakable faith Alberta
farmers put in their province, it is refreshing to cite the
pledges of the farmers of the Lethbridge Northern Irriga-
tion District to bond their land for irrigation works by a
vote of 278 to 16.
The year has been a successful one in the coal mining
industry. The market for Alberta coal is widening and in-
creasing. Shipments 'are going east to Ontario points and
west to the Pacific coast. Production up to the end of No-
vember was 6,750,000 tons and it is estimated production will
pass the 7,000,000 mark by the end of the year. It is the
largest on record.
The ordinary statistics of bank clearings, post office and
customs returns and building returns indicate a satisfactory
THE MONETARY TIMES
Volume 66
increase except in tlie building returns. In the two principal
cities buildings erected this year total $6,000,000. Still hous-
ing is scarce. The liigh building costs and the fear that
lurks in the minds of those who formerly invested in home
building property, that city taxes will wipe out all profits
no matter how high rents go, is causing a slump in the num-
ber of houses available for a steadily increasing population.
On the other hand, there are evidences of increased interest
on the pa-rt of investors in the natural resources of the
country. The number of application to the Provincial Utili-
ties' Commission doubled in 1920 over the number in 1919.
A number of joint stock companies that were quiescent dur-
ing the war are now applying to be placed on the register.
Many new companies are being organized and 400 certifi-
cates of incoi-poration have been issued during the year.
There has been an increase in the commercial and manu-
facturing industries in the past year. Many new firms have
been added to the business directories of our cities. There
have been extensions of plant and improvements in equipment
of many of the old-established houses. It is a sign the pro-
vince is becoming more self-sustaining every year. Condi-
tions seem to be moving to a steady readjustment from those
prevailing immediately after the close of the war. There is
no doubt costs are falling, that there is a growing surplus of
lator that is leading to the survival of the fittest on the job.
Business men and employers seem to be anxious to get back
to a basis of steadier and better production, and hope by re-
ducing the cost of production to be able to promote increased
consumption by all classes, instead of by those who were
fortunate during the war.
llllllllllllllllllllllllllllllllllllllllllllllllllllllHllllllllllllllllllllllllllllillllllllllllllllillilllllllllllMIIIIIIIIIIMII"^
QUEBEC
By
Honorable
L.A.TASCHEREAU
Premier
WHILE moving in an orderly and progressive way in
every sphere of human activity, the people of the pro-
vince of Quebec have, in 1920, devoted their attention chiefly
to agricultural development. Realizing that the world-short-
age in food is threatening to bring about a fateful crisis and
has become the most vital after-war problem, members of
the government as well as our leading professional and busi-
ness men were all agreed that everything must be done to
help and increase agricultural production. Our farmers
proved equal to the task laid upon them, and set about to
make of Canada a self-contained nation as to food and
supply some of the foodstuffs that must be provided for the
millions dependent on the land.
The tiller of the soil was considered one of the pivots
upon which the result of the great war turned; he appears
to-day to be the axis upon which the destiny of European
and American nations revolves. Since there is no larger
sphere of duty to our country and to the world, the province
of Quebec may well take pride in the patriotic action of the
farming communities.
Our province had in 1920 over 175,000 farmers at work,
and the area under cultivation was considerably increased.
In the remoter districts of Abitibi and Lake St. John hardy
pioneers kept on gaining ground and laid under the plough
thousands of acres of productive soil, which yielded in many
places forty bushels of oats to the acre. The value of our
crops this year was $327,063,000 as compared with $307,994,-
280 ill 1919. The average yield of cereals per acre has been
far superior to that of the previous year, and largely com-
pensated for the small decrease in the yield of hay and
corn caused by the drought at the beginning of the summer.
Although the Quebec farmer is more prosperous than
he ever was, he remains the man of simple life, of frugal
tastes, fond of his home, and still puts his pride in raising a
large family. He is a healthy type of Canadian. In follow-
ing up the best methods of agriculture that h&ve been evolved,
he is developing into a most effective worker of the land.
Thanks to her forest wealth, our province was also able
during this year to answer a most pressing want. Our pulp
and paper mills worked at their full capacity and many had
to be enlarged. Statistics are not yet available to show the
number of tons of pulp produced, but 1,000,000 tons should
be a conservative figure. As to the total value of all the
raw forest products for the year, it will amount to over
$45,000,000.
In the first six months of this year, our province ex-
ported 778,246 cords of pulpwood valued at $9,556,255, and
from April to September for $103,949,481 worth of pulp and
paper.
In order to assist the pulp mills and other mills, and
to create new thriving manufacturing towns such as
Grand'Mere and Shawinigan Falls, the government is fol-
lowing up its policy of developing the most useful water
powers. A storage dam is being built on St. Anne River, and
surveys are being made for developments on the Nottaway
and Megiskan Rivers, and the Kenogami and St. John Lakes.
Our mineral production, which increased during the
last ten years from $7,000,000 to $10,000,000, is steadily en-
hancing. Important discoveries of gold and molybdenite were
recently made in the Abitibi which promise to make of this
new region an important mining district.
While generous appropriations were made in favor of
technical schools, and the erection of a score of rural
academies was planned, this year has been especially de-
voted to the cause of higher education. The government has
granted $3,000,000 to be shared equally between McGill,
Laval and Montreal Universities, and it has besides estab-
lished many new European scholarships. Four young forestry
engineers left this last month for a special course abroad.
As to our financial situation, the rule established in re-
cent years still prevails and our budget shows a surplus
which gradually reduces our debt now standing at a little
less than $12 per capita. Our debentures are consequently
much sought after, as are all our municipal and corpora-
tion bonds. If banking may be considered a true barometer
of provincial conditions, to tell the tale of our prosperity we
need only refer to the great increase of deposits in 1920 and
the opening of many new branches throughout our province
by our leading banks.
While they had to bear the high cost of raw material
and the sudden slump in retail prices, our manufacturers,
however, have had a prosperous year.
Among other industries, shipbuilding is making great
strides in our province, and Montreal is claiming interna-
tional attention.
The sanity and level-headedness of our laboring cla-ss
saved us from strikes and bolshevist tendencies such as have
more or less handicapped other countries' industrial en-
deavors. This again should help solve the unemployment
problem. With prices falling our laborers will understand
that wages must follow suit, and fewer men and women will
then have to be released.
L. A. TASCHEREAU.
January 7, 1921
T'HE MONETARY TIMES
Provincial Legislation of the Year 1920
Summary of the More Important Legislation Placed on the Statute Books
During the Past Year — New Ontario Government Failed in Ecomony But
Succeeded in Politics— Tendency to Raise Taxes on Accumulated Wealth is Evident
From Increases m Succession Duties — Higher Taxes on Financial Institutions
PROVINCIAL legislation affecting finance and industry dur-
ing the past year is of considerable importance. The rapid
expansion of the past few years required some changes of this
kind. The tendency towards increased public expenditures
made increased taxes also necessary. The new legislation of
the year has a strongly soc"al flavor, minimum wage, housing,
mothers' pension and similar laws being very prominent. An
effort was made to raise the money for these purposes by
higher succession duties, on commercial and financial institu-
tions, and on other forms of accumulated wealth. Experi-
ments are also being made in the way of provincial assistance
to new industries.
The time at which the legislatures met is indicated by
the following dates: —
Opened Closed
British Columbia Feb. 1
Alberta Feb. 15 April 10
Saskatchewan Nov. 27, 1919 Feb. 7
Manitoba
Ontario Mar. 9 May 28
Quebec Dec. 4, 1919 Feb. 14
Nova Scotia Mar. 4
New Brunswick Mar. 11 April 24
Prince Edwai'd Island
Yukon April 28
Ontario Has Big Record
The Ontario session was of outstanding interest this year,
as at the elections in the fall of 1919 the farmers had been
returned as the strongest party, although they had to form
a coalition with the small labor group to secure a majority in
the house. The new party had been elected on a platform of
economy, but like other new governments, it has found it im-
possible to carry out in power what it had advocated in oppo-
sition.
The large number of 260 acts were passed by the govern-
ment house. The estimates were higher than ever before, and.
new taxes were as a result necessary. These took the form of
increases in succession duties, in taxes on corporations, in
taxes on race tracks, and on transfers of stock. The succes-
sion duties in the province now range from 15 to 60 per cent.,
which is exceptionally high. The taxes on banks were prac-
tically doubled, and those on loan companies substantially
raised. The tax on race tracks is now $7,500 per day for
mile tracks and ?2,500 per day on half-mile tracks.
This increase in revenue was for additional expenditures
for ordinary provincial purposes, including a good roads pro-
gramme, of which the farmers were strongly in favor, and a
mothers' pension act, which was passed largely through the
efforts of the labor members. Provision was also made for
the superannuation of civil servants. The influence of the
labor section is also shown by the minimum wage acts and the
amendment increasing the rate of workmen's compensation.
An extension of the Temiskaming and Northern Ontario
Railway to James Bay was authorized, although construction
will not be commenced for some time. The two big commis-
sions in the province, which are the Hydro-Electric and the T.
and N. O., have received strong support from the now govern-
ment, although it has been keenly criticized for not authoriz-
ing the former to purchase the radialfrailways of the Domin-
ion government without making an investigation first.
Another important bill passed at the last session of the
Ontario house was that providing for local option in municipal
taxation, by which improvements up to a certain amount may
be exempted from taxation. In recognition of the changed
financial conditions it was also enacted that provincial bonds
might in future be issued bearing interest at more than 6 per
cent.
The Quebec legislature dealt with the city of Montreal's
charter, the housmg question, the provincial public service
commission, grants to railways, McGill University's finances,
and a number of other financial questions. The amendment
to Montreal's charter took the form of an act providing that
there should be no election at the end of 1920, but that in-
stead a commission should be appointed to frame a new form
of government for the city. This commission was to be com-
posed of sixteen members, representing various interests in
the city. It is still working out a new plan of government for
the city.
The new housing act dropped provincial control of hous-
ing, under an enactment of the 1919 legislature, but provided
that the government should still make advances to munici-
polities for housing purposes, accepting as security their 5 per
cent, bonds at par. Provision was made for flats as well as
individual dwellings by making the loans applicable to tene-
ments of three flats erected at a total cost of $13,500.
The name of the Quebec Public Utilities Commission was
changed to the "Quebec Public Service Commission," and some
important changes were made in its powers. The sessional
indemnities of members of the legislature were increased from
$1,500 to $2,000. A new companies act was passed to take
the place of the existing legislation regarding the incorpora-
tion and management of companies in the province. The
"General Accountants' Association in the Province of Quebec"
was incorporated, as was also a million-dollar company called
the "Guarantee Title Bond and Trust Corporation of Canada."
Amendments were also made to the charters of "La Prevoy-
ance" Assurance Company, and of the Industrial Life Insur-
ance Company.
Saskatchewan Legislation
Legislation of the Saskatchewan government included a
new seed grain act, amendments to the towTi act and to the
rural municipality act, a new village act, the Saskatchewan
Loans Act, a Sale of Shares Act, and an Attachment of Debts
Act. A new and increased scale of succession duties was also
put in force. An advisory board was created to assist the
wild lands tax commissioners. The status of the provincial
bureau of labor was enlarged to that of a provincial bureau of
labor and industry, with power to investigate the possibilities
for new industries and for extension of existing ones. Sev-
eral measures in the way of development, affecting irrigation
and water supply, were passed.
The Saskatchewan Loans Act authorized the borrowing of
money in advance of the fiscal year, in order to take advan-
tage of favorable financial conditions. The provincial mora-
torium was extended to February 1, 1921. Provision was
made for financial assistance to co-operative enterprises, such
as the Saskatchewan Co-operative Elevator Company and the
Saskatchewan Creameries, Ltd.
Other Provincial Legislation
The Manitoba legislature took up the question of assist-
ing industry in the province, railway and other developments
in the north, and the extension of the rural credits system in
the province, which is now to be financed with the assistance
of a Manitoba savings bank. Hail insurance also received at-
tention and some changes were made in the law.
British Columbia authorized several new loans, and passed
acts relating to the Pacific Great Eastern and several other
railways. Efforts were also made to enable the municipalities
to raise more revenue. A mother's pensions act was one of
several pieces of social legislation placed on the statute books
of the province.
The Yukon legislature at its 1920 session passed eleven
acts, the most important being one prohibiting the sale of in-
toxicants for beverage purposes.
THE MONETARY TIMES
Volume 66
CANADIAN BOOKS OF THE YEAH
Scarcely Any Deal Directly With Finance or Industry —
Canadian Trade Index a I'seful Directory —
Many Books of Legal Cliaracter
OUTSIDE of law books having a close relation to industry,
there were scarcely any books published during 1920 on
Canadian economic subjects. In 1919, on the other hiand, agri-
culture, the raih'oads, and several other branches, received con-
siderable attention.
Probably the book of most importance to Canad'an eco-
nomic life was the Canadian Trade Index for 1920-21, which
is really not a book at all, but rather a directory (Canadian
Manufacturers' Association, Toronto, 832 pages, $6). One of
the valuable services rendered to manufacturers of Canada by
the Canadian Manufacturers' Association is the publication of
this complete reference list. The object of the index is to
provide all buyers of Canadian manufactured goods, in what-
ever country they may be, with a dependable list of the arti-
cles made in Canada and the names of the manufacturers
making them. In addition to the list, arranged alphabetically
under the names of the products, this edition introduces two
new features: A continuous alphabetical list of all manufac-
turers, whether members of the association or not; and a
translation section in French and Spanish.
Every year sees a considerable number of law books pub-
lished in Canada, some of them being closely related to eco-
nomic affairs. About the end of 1919 there was one published
which is of outstanding value. This was "Dominion Company
Lay," by Thomas Mulvey (Ontario Publishing Co., Ltd., Tor-
onto, 889 pages, with index, .$12.50). The author, who is
under-secretary of state for Canada, and an authority on
company law in this country, sets foi-th thoroughly the law as
it affects companies incorporated under federal charter. His
synopsis of the Dominion Companies Act, and of the practice
thereunder, which occupies seventy-two pages of the book,
will be particularly instructive to those not conversant with
the subject, and will readily be understood by business men
without legal training. The text of the Dominion Companies
Act is set forth in full, and annotated, as are also the provi-
sions relating to loan companies, British loan companies, and
British and foreign mining companies. The Dominion Wind-
ing-up Act is treated in the same way, and then the licensing
and taxation legislation in the various provinces is taken up,
in so far as it affects companies with Dominion charters.
Finally, the Income Tax Act and the War Profits Tax Act are
given, and a list of forms to be used by companies. The
book will be very useful, not only to corporation lawyers, but
also to the officers of any company which operates under
Dominion legislation.
Another was "Executors' Accounts," by C. H. Widdifield,
judge of the Surrogate Court of Grey County, Ontario (The
Carswell Co., Toronto, 531 pages, with index, $6.50). This is
the second edition of this book, but since the first was pub-
lished considerable legislation has been passed altering the
practice and procedure of the courts. Trust company officers
will find the book exceedingly valuable, and a good index
makes it convenient for reference.
Fraser's "Company Forms and Precedents" contains ovev
1,000 forms. Those relating to applications for registration
or license under the Extra-Provincial Corporations Acts of
the different provinces and to departmental applications are
based on precedents which have been approved and accepted.
A selection only of statutory and departmental forms has
been included. These are subject to change from time to
time, and are always available on application to the proper
Dominion or provincial authorities (The Carswell Co., Ltd.,
Toi-onto, 699 pages, with index, $10^
Book on Railway Law
The passing of a new railway act at the 1919 session of
parliament gave this country a new railway law, no less than
sixteen previous acts being repealed, either in whole or in
part. As a result of this change, "Concordance of the Rail-
way Act," by A. H. O'Brien, M.A., has been published (Can-
ada Law Book Co., Toronto, 184 pages, $6). This volume is a
new edition of "Currie's Concordance," and gives, in addition
to the text and a thorough index of the Railway Act, 1919, an
index to all acts of parliament affecting railways, an account
of the Board of Railway Commissioners and an index to its
regulations and forms, and considerable other useful informa-
tion.
A similar publication in the field of company finance
was "Concordance of the Companies Act," by Leslie G. Bell.
(Carswell Co., Toronto, 181 pages with index; $5.) This
book covers the Dominion Companies Act, the "Business Pro-
fits War Tax Act, the Income War Tax Act, and provincial
legislation applicable to Dominion companies. The increas-
ing number of incorporations and the growth and import-
ance of legislation governing such bodies make it a very
useful work. The "Office Consolidation of the Companies
Act," which comprises 88 pages of the book, is a thorough
index to all subjects dealt with by the act.
Manual on the Tarifif
Another useful publication was "Canadian Customs and
Excise Tariffs," by M. P. McGoldrick. (Chas. S. J. Phillips,
20 St. Nicholas St., Montreal. 504 pages; $2.50.) This
handbook shows the tariff on all classes of goods alphabeti-
cally arranged, and includes the Revenue Act of 1920. It
also shows thei articles subject to luxury tax and those
exempt from sales tax, and the stamp tax legislation. Other
features are a list of warehousing ports, outports, etc., in
the Dominion; the trade conventions with Belgium, Nether-
lands, Japan, Italy and British West Indies; extracts from
the Customs Act, specimen forms of customs, documents,
foreign weights and measures with their Canadian equival-
ents; tables showing Canadian customs value of foreign cur-
rencies; conversion tables of sterling and francs into Cana-
dian money; Montreal wharfage tariff and list of principal
customs brokers in Canada.
Currency Exchange Tables
A book entitled "Currency Exchange Tables" (G. B.
Sneli, CO Bank of Montreal, Montreal, $7.50) has been wel-
comed by the business houses of Canada as a timely aid for
calculating the exchange on New York funds. The table
gives the exchange on all amounts from $100 to $10,000,
at all rates from %i to 1 per cent., advancing by sixty-
fourths and from 1%2 to 10 per cent., advancing by five
thirty-seconds. The exchange on larger or smaller amounts
can be arrived at by simply moving the decimal point to the
or left as required. The second edition, just issued, contains
in addition a table showing the comparison between the
premium on United States funds in Canada and the discount
on Canadian funds in the United States.
"Daylight on the Money and Banking Questions," by
R. C. Owens (Western Veteran Publishing Co., Edmonton,
Alta. 47 pages; 25 cents), was a pamphlet making some
radical proposals. The author believes that wealth is pro-
duced by labor alone. "It is a recognized fundamental fact
of political economy that labor produces all wealth," he says.
He accordingly deplores the accumulation of wealth through
interest, and urges radical changes in the money and bank-
ing system. His chief proposals are: That the government
issue sufficient legal tender money for all needs, thereby
abolishing credit and interest, and that banking be conducted
by the government at cost; that a tax on land values be
imposed; that the tariff be abolished; that natural resources
be the property of the people; that public utilities be operated
at cost; that six hours be a legal day's work; that each per-
son over 55 years of age receive a pension; and that an in-
come tax of from 50 per cent, to 100 per cent, be levied on
all incomes from $2,000 to $1,000,000, until the public debt
is paid.
General interest in the application of the Bankruptcy
Act has led to the commencement of a special publication,
to deal carefully and exhaustively with the development of
the law under the act. The series is known as the Canadian
Bankruptcy Reports, Annotated, published by Burroughs and
Co., Ltd., of Calgary, Alta., and handled in eastern Canada
by their eastern office. Burroughs and Co. (Eastern), Ltd.,
Witness Building, Montreal, Que.
BANKING
Jamiary 7, igii
THE MONETARY TIMES
Page .;j
32
THE MONETARY TIMES
Volume Ofi
BANK OF MONTREAL
Established over 100 years
Capital Paid Up
Rest
Undivided Profits
Total Assets
$22,000,000
22,000,000
1,251,850
560,150,812
Board of Directors :
SIR VINCENT MEREDITH. Bart.
SIR CHARLES GORDON. G.B.E. -
R. B. Angus, Esq.
LordShaughnessy, K.C.V.O
C. R. Hosmer, Esq.
H. R. Drummond, Esq.
D. Forbes Angus, Esq.
Wm. McMaster, Esq.
Vi,
iJcnl
iJenI
Lt.-Col. Molson.C.MCM.C
Harold Kennedy, Esq.
H. W. Bcauclerk, Esq.
G. B. Eraser, Esq.
Colonel Henry Cockshutt
J. H. Ashdown, Esq.
E. W. Beatty, Esq., K.C.
SIR FREDERICK WILLIAMS-TAYLOR, General Manager
A Complete Banking Service.
With branches in every part of the
Dominion and Newfoundland, with offices
in the principal financial centres elsewhere,
and with correspondents in all parts of the
world, the Bank of Montreal offers unex-
celled facilities for the transaction of every
class of domestic and foreign banking.
Direct Jeire service helTX)een Montreal, Toronto, Winnipeg,
V ancouver, Nen> Yorl^, Chicago anJ San Francisco.
A Savings Department at each Canadian Branch.
Interest at current rates
PRINCIPAL BRANCHES OUTSIDE OF CANADA:
LONDON, Eng. :
47 Threadneedle Street, E.C.
G. C. Cassels, Manager.
Suh-Agency — 9 Waterloo Place,
Pall Mall, S.W.
PARIS, France :
Bank of Montreal (France), 17
Place Vendome.
NEW YORK AGENCY : 64 Wall St.
R. Y. Hebden. W. A. Bog, W. T.
Oliver, E. P. Hungerford, Agents.
CHICAGO : 27-29 South La Salle St.
SPOKANE, Washington
SAN FRANCISCO: British-American
Bank (owned and controlled by
the Bank of Montreal).
MEXICO: City of Mexico.
NEWFOUNDLAND: St. John's. Car-
bonear. Curling. Ferryland, Gaul-
tois, Grand Falls. Greenspond
and St. George's.
WEST INDIES. BRITISH GUIANA
and WEST AFRICA: The Col-
onial Bank (in which an interest is
owned by the Bank of Montreal).
January 7, 1921
THE MONETARY TIMES
Review of Canadian Banking in 1920
Tightening of Credit Was Most Prominent Feature— Failure of Deposits to Respond
to Growtli of Loans— Fewer Branches Opened than in 1919— Substantial Addition
' to Paid-up Capital and Reserves— Effect of Depreciated Currency on Banking
By A. B. BARKER.
DURING the past year the banks have been reluctant to
increase their commitments. The business of the coun-
try has been conducted for several years under a condition
of steadily rising prices, necessitating the use of an increas-
ing amount of credit to handle stocks of goods. These high
prices have, it is believed, reached their peak, and from now
on should recede. The executives of the banks at the various
annual meetings have emphasized the necessity for great
caution in view of the disturbed financial and political out-
look everj'^vhere. Throughout the year credit has been re-
stricted, and loans for purposes other than commercial have
been increasingly difficult to obtain. This was particularly
noticeable in the early fall.
Even in normal times, owing to the general preparations
for financing the western crops movement, the banks find it
necessary to curtail anything in the nature of speculative
advances, but this season the movement has been more pro-
nounced. Formerly relief was obtainable from London in
anticipation of grain exports, but this year, owing to the fall
in sterling, the grain is not likely to go forward in the same
quantities as before. This will throw an additional load on
home funds, even with wheat at reduced prices. There will,
in consequence, be heavy demands on the banks from western
customers to enable them to carry the crop until it can be
sold to better advantage.
This is a matter of vital interest to the rest of Canada,
as unless the farmers can obtain adequate prices for their
grain the purchasing power of the west will be greatly cur-
tailed, with unpleasant effects on the rest of the country, as
it means contraction of trade, which will in turn react on the
flow of deposits, and without a steady increase of deposits
bank credits cannot expand. A bank is a merchant in credit,
buying it from depositors and selling it to the commercial
community. If the supply is not sufficient the volume of
sales must decrease.
Smaller Deposits Anticipated
That some reduction in deposits is looked for by the banks
the public statements of their responsible officers leave no
doubt, and they are wisely setting their houses in order in
preparation for this contingency. This condition is not con-
fined to Canada; it is world-wide, and is due to the strain of
readjustment after the war. The satisfactory feature is that
the preparations to meet coming conditions have been steadily
going on for months, as evidenced by the curtailment of credit,
and, judging from past experience, the ti-ansition, because of
these preparations, will be effected with the minimum of loss.
The government announced when the 1919 loan was is-
sued that it would be the last loan of the kind and that fu-
ture expenditure would be met by taxation. At the begin-
ning of the year it was estimated that receipts would fall
short of expenditure by some $90,000,000. The new taxes,
however, produced something like $100,000,000 in excess of
expectations, and a surplus is now confidently expected in-
stead of the deficit. Borrowings by the government therefore
liave been merely the usual anticipations of revenue.
During the year two more Canadian banks have opened
offices in London, England — the Merchants Bank and the
Bank of Nova Scotia.
New Developments in West
There have been no further amalgamations, but a new bank
is understood to be in process of formation in the west.
Nothing has been said of it lately, and it was reported that
the promoters were waiting until after the harvest to canvass
subscriptions. Much will doubtless depend on the returns re-
ceived by farmers for their wheat, and as this has lately fallen
to below $2 a bushel, the prospects of obtaining the subscrip-
tions necessary to apply for a chai-ter are none too favorable,
this year at any rate.
Owing to its failure to induce the banks to make ad.
vances for farming purposes at less than market rates, the
province of Manitoba has undertaken an experiment in finance
which will be watched with interest by all, whether in sym-
pathy with the plan or not. This is the taking of deposits
from the pubic in order to finance loans to farmers. The ob-
ject is one of the best, and while the plan has been criticized
strongly there is no quarrel with the object sought. It is the
plan itself to which objection is raised. The scheme provides
for advances to farmers to mature not later than December
31st, and for one renewal for twelve months. This will make
the average loan a fairly long-term one. Now, if the funds
from which these loans are made, were obtained for this definite
purpose and on similar terms, there would be small objection
to the scheme, but when the funds are obtained from deposits
payable on demand, the possibility of trouble is not far
away. It is understood that the act permits advances by the
province, but if the depositors want their money, the province
can raise the funds only by borrowing, and in this case it will
have to pay market rates. No lending scheme has ever suc-
ceeded when demand funds have been used for long-term in-
vestments, as numerous failures have shown, and it is a mat-
ter of regret that so worthy. a scheme should be started on
principles fundamentally unsound.
Banks Not So Strongly Criticized
There has been much criticism of the banks for insisting
on business principles when co-operating with the provinces,
but there are unmistakable signs that many of the critics are
beginning to realize that the Canadian banking system has
really been the salvation of western Canada. An extract
from a recent editorial in the Calgary Farm and Ranch Re-
view, which has heretofore been most critical, is an evidence
of this: —
"A CHANGE OF HEART
"Confession is good for the soul, and here is where I take
advantage of it. I have thought and said a good many harsh
things about our banks and banking system generally during
past years. I have admitted its virtues for commercial enter-
prise, but have been rather more than sceptical in regard to
its application to agriculture. I have been a believer in the
smaller local bank, trading largely on the moral asset and be-
ing in closer human touch with its rural customers. I still
think that the local bank has much to recommend it.
"But a retrospect of the past three years, with pyramiding
farm credits, forces me to the conclusion that no system of
local banks could successfully have met the credit require-
ments of western Canada, at least, during the present season.
That it was precisely the ability of our powerful banks to
concentrate funds where needed when the pinch came that
saved the situation for a very large number of farmers in the
areas that have been drouth-stricken in recent years. We
'live and learn,' or ought to learn. I cheerfully admit that
more recent information and contemplation have caused m '
to change my mind in regard to our banking system."
Fewer Branches Opened
The past year has not been so marked by the increase
of branches as was 1919, when some 800 were opened. There
was a special reason for this, as during the war the shortage
of staff precluded much activity in this direction. With the
THE MONETARY TIMES
Volume 66
return of so many of their men to civil life, the banks took
advantage of the opportunity to extend into new territory,
particularly in the west.
During the year the paid-up capital of several of the
banks was substantially increased, through the payment of
calls on stock issued during the previous year. The total
paid-up capital at the end of September was $126,927,040,
and the rest $130,325,640, increases of $9,876,801 and $7,283,-
890 respectively.
The total s-ssets show a marked increase over 1919 and
previous yeai's. In 1914 they were, at the end of December,
$1,555,550,815, in 1919 $2,967,373,695, and on October 31, 1920,
$3,155,601,568.
Money Is Depreciated
While in figures this shows marvellous growth, the
changed value of the dollar must be taken into consideration.
According to the Department of Labor, the index number for
June, 1914, was 135.6, and for June, 1920, it was 346, indicat-
ing that the value of the dollar in 1920 was about 40 cents as
compared with 1914. When the various statistics of trade
and finance are adjusted on this basis the actual growth will
be more clearly shown. The index number is a modem idea
and one we will hear more of in the future. It is a device
for keeping record of the variations in the price of commodi-
ties as a whole by establishing a certain average figure based
on the prices of commodities in common use. Fluctuations
in a commodity price affect the index number, thus affording
a good record of one of the main factors affecting living con-
ditions. Money is a commodity as well as a measure of value,
and when prices measured in money rise, the value of money
as a commodity falls to the same extent, and more money is
required to do the same volume of trade as before.
Educational Work
In recent years the Canadian bankers have realized the
necessity of providing some system of education for the mem-
bers of their staffs, along lines similar to those followed by
the Scottish banks, which have so increased the efficiency in
the banks of that country. Owing to the numerous branches,
and the difficulty of giving their men the varied practical ex-
perience necessary to train them for work in other sections of
the country, some method had to be found of grounding them
in the theories on which all banking business should be based.
For those in the cities courses of lectures have been estab-
lished, and for those in the smaller centres courses in the
vai'ious banking subjects ai-e carried on by correspondence.
Inducements have been offered by the various banks to the
members of their staffs to take advantage of these facilities,
and the wide response has sho\\'n a spirit of enquiry among
the younger officers, which is full of promise for the future.
Many of the larger American banks have these educational
facilities. The National City Bank in New York, before send-
ing out a man to their foreign branches, gives him a thorough
grounding in the banking and commercial law and customs of
the country to which he is sent, and thus endeavors to give
him the confidence born of knowledge, which will, to a great
extent, guard against mistakes both in policy and execution.
TWELVE MONTHS' BANK FIGURES (COMPARED)
Circulation
Deposits on Demand
1919
November 242,309,082 \ 248,073,385
December 240,705,540 ' 247,611,079
January. . .
February . .
Marcli
April
May
June
July
Augusts . . .
September .
October. . .
1919
226,385,506
210,894,809
216,529,576
223,763,426
219,287,788
222,712,991
223,662,648
223,454,556
229,532,356
242,509,573
1920
237,269,805
223,979,656
231,220,770
243,226,193
235,085.179
238,(188,555
240.833,686
237,697,647
242,988,866
2,'>2,882,760
1918
1919
$
$
666,366,359
728,657,589
711,034,060
703,392,204
1919
1920
62.S,919,410
621,408,024
566,775,434
620,069,555
566,797,268
6.57,412,028
571,412,8.57
6.52,918,760
.568,730,118
645,957,229
605,927,027
6.59,622,583
584,176,765
639,415,(IJ5
584,300,855
640,.361,707
650,743,015
677,286,905
705,280,241
687,651,781
Current Loans in
Canada
Current Loan*
Abroad
Deposit* after
Notice
1919
939,329,271 1,137,858,277
9.58,473,557 1,138,086,691
1919
990,000,
1,018,184,
1,037,851,
1,070,985,
1,107,983,
1,139,569,
1,175,092,
1,196,632,
1,127,*37,
1,262,746,
1920
,'.63,297,037
,187,027,307
,197,719,570
,209,573,760
,229,073,515
,•243,700,977
,253,170,443
,261,647,7.32
,270,194,097
,271,275,751
Deposits Abroad
221,299,711
206,845,143
1919
203,015,797
200,560,308
210,104 607
212,649,478
221,605,846
240,201,440
294,650,777
238,363,859
255,274,256
2.53,965,203
1919
259,047,187
275,342,645
1920
285,203,939
277,478,631
318,277,881
327,235,197
345,095,475
360,358,386
348,008,545
356,.570,176
355,238,992
339,955,233
Call Loans in
Canada
November.
December.
Januar5'. . .
February .
March . . . .
■April
May
June.
July
.\ugust. . . .
September
October . .
1,082,709,655
1,075,640,003
1919
1,080,340,861
1,095,301,791
1,117,197,446
1,107,986,523 1
1,071,447,686
1,043,712,9,32
1,014,387,206
1,011,785,424
1,058,-572,202
1919 1918
$ S
1,189,408,5231 110,010,815
1,207,109,0461 119,153,924
1
1,104,940,16011
1920
,226,962,963
,257,015,902
,.322,267,030
,347,238,230
,.349,079,981
,365,151,083
,377,276,853
,385,470,1.53
,417,-520,756
,405,401,227
1919
513,3.38
590,063
984,608
328,561
490,932
525.5.50
217,957
964, .11 5
814,511
713,386
1919
149,302,293
168,955,696
1920
182,.533,I24
180,711,238
183,642.658
185.085,021
183,986,222
184,328,464
190,914,052
200,945,241
202,590,184
193,749,657
85,675,063
89,120,423
1919
87,598,427
79.154,121
87,601,337
86,091,844
89,187,032
95,8.52,728
93,587,497
95,899,836
96,912,709
100,549,390
1919
;
121,7-54,469
125,888,760
1920
132,015,334
127,251,919
12«,233,310
125,644,859
119,114,493
115,272.587
11.5,360,894
113,5"8,923
114,669,611
113,135,902
Call Loans
Abroad
1918
1919
$
$
171,035,7.32
169,626,880
150,248,322
172,232,161.
1919
1920
140,819,656
170,206,805
155,98.3,681
184,469,882
160,116.443
205,2112,133
1.55,533,666
206,229,451
157,176,325
213,964,182
167,236,045
219,214,431
178,098,434
203,045,209
174,176,578
193,888,245
169,532,489
186,9H2,960
158,194,085
188,367.459
January 7, 1921
THE MONETARY TIMES
Banks' Service in Public Finance
Dominion Government Deposits Have Decreased During Past Year— Trend of
Provincial Deposits Fairly Even— Municipalities and Provinces Increase their Loans
—Holdings of Public Securities Have Been Liquidated to Meet Commercial Demands
AS DEPOSITARIES of the Dominion government, Canadian
banks during the pa«t few years have performed a service
of inestimable value. Ordinarily, the collection and disburse-
ment of the national revenues involves considerable woi-k, and
the balances maintained by the government are supposed to
recompense the banks, as these funds may be used for coirLmer-
cial or other purposes. When the Dominion government com-
menced floating domestic loans, however, the banks were
called upon to act as intermediaries, and during each campaign
and for some time after an enormous amount of work was
done by these financial institutions with little remuneration.
Following each loan large amounts were placed on deposit, but
as the government did not float these loans for the purpose of
holding the money on hand, these balances, an illustration of
which will be seen in last year's figures, were quickly with-
drawn, so that the banks benefited but little. Furthermore,
interest on Canada's debt is paid through the banks, and small
though this item may appear, it involves considerable work,
and will continue to do so for some time.
As no domestic loans were floated in 1920, the work of the
banks was somewhat reduced in this regard. Balances main-
tained by the government were also reduced, however, so that
the banks had less money at their disposal.
The course of deposits of the provinces in chartered banks
has been fairly even in the past few years, therefore this ac-
count calls for little comment. The following figures show the
balances due to the Dominion and pi-ovincial governments at
the end of each month since the beginning of 1919: —
Due Dom. Due Prov.
1919 — Government Governments
January ?236,119,588 $21,238,779
February 238,256,091 20,800,869
March 228,201,515 21,646,571
Due Dom. Due Prov.
1919 — Government Governments
April 188,129,800 21,754,210
May 113,860,593 26,196,865
June 128,890,218 24,454,438
July 140,575,172 23,499,116
August 100,639,909 23,552,757
September 110,217,948 24,094,698
October 121,028,537 20,699,308
November 350,381,389 17,625,464
December 224,926,921 19,032,841
1920 —
January $224,597,564 $20,276,072
February 217,059,832 19,864,020
March 262,340,599 17,827,892
April 261,044,115 19,178,187
May 216,098,321 20,691,300
June 183,913,852 23,955,524
July 170,190,302 26,344,597
August 153,359,936 25,057,401
September ^ 156,410,480 20,933,968
October 160,129,252 24,942,898
Loans to Provinces and Municipalities
Notwithstanding the increased amount of permanent
financing during the past two years, provinces have greatly
increased their bank loans. At the beginning of 1919 the total
amount of these loans was $5,410,289, while at the end of Octo-
ber last the figure was $14,361,485.
Of more importance than loans to provinces, however, are
loans to municipalities. During the past year these advances
have shown large increases. The condition of. the bond mar-
THE MONETARY TIMES
Volume 66
ket was, no doubt, the chief x-eason, but a review of the amount
of permanent financing shows that bond issues were equally
substantial in total as in the previous year.
Many municipalities, during the war and for some time
after, refrained from spending large sums on improvements,
some of which were really necessary. Consequently a number
of these municipalities undertook to do that which they had
neglected during times of stress. Had the bond market been
anything like normal there would have, no doubt, been a flood
of securities, but prevailing conditions prevented this. Evi-
dently temporary accommodation had to be secured in a large
number of cases.
The trend of these loans accounts since January, 1919, is
shown in the following table: —
Loans to Loans to
1919 — Provinces Municipalities
January $5,410,289 $32,640,198
February 6,159,859 36,380,183
March 6,636,143 41,993,305
April 8,660,899 47,911,199
May 8,156,982 50,356,227
June 8,104,927 52,349,352
July 3,700,208 54,455,738
August 4,846,194 57,536,867
September 6,667,116 57,033,309
October 11,226,420 56,116,897
November 13,815,103 52,703,363
December 15,187,626 42,635,290
1920 —
January $11,271,190 $46,147,388
February 13,090,090 52,690,790
March 13,585,217 62,992,675
April 18,768,268 72,281,019
May 18,887,396 73,904,635
June 15,773,409 76,410,676
July 14,994,799 78,792,822
August 12,314,726 79,912,041
September 13,183,317 78,103,364
October 14,361,485 71,374,060
Public Security Holdings
Another public service which the banks perform is their
extensive purchase of securities. During the past year, how-
ever, holdings of such securities have been greatly reduced. A
large part of the amount under "Dominion government and
provincial government securities" represents loans to the Do-
minion on security of treasury bills. It will be seen, there-
fore, from the figures given below, that the government has
not been leaning so heavily on the banks as in 1919.
In times of easy money the banks employ surplus funds
by purchasing such securities as municipal, railroad and other
bonds. The year of 1920, however, was by no means a period
of easy money, but rather extremely adverse. Demand for
funds was so great that banks found it necessary to liquidate
their holdings of securities and place the money where it could
be used for commercial and other necessary purposes.
The following figures illustrate these remarks: —
Dom and Can. Mun. & Railways &
Prov.Gov. other public other bonds
1919 — Securities Securities etc.
January $159,039,874 $259,462,077 $53,546,118
February 112,160,131 259,422,456 53,416,524
March 115,180,320 260,003,939 54,276,188
April 117,616,232 258,504,084 54,628,223
May 123,939,312 256,617,235 56,812,743
June 224,301,264 254,147,015 55,191,819
July 278,190,601 253,490,909 55,214,138
August 273,332,930 254,235,984 52,679,157
September 323,781,953 255,098,813 53,658,486
October 361,280,956 255,684,576 54,442,926
November 336,855,869 253,341,708 54,327,528
December 149,780,058 255,239,781 54,957,659
1920 —
January $127,087,135 $249,413,578 $51,548,307
February 125,729,366 234,608,866 50,605,825
March 126,609,453 223,709,931 50,969,557
April 118,416,840 214,768,123 50,778,055
May 117,864,456 205,129,314 47,988,462
June 117,471,598 206,534,550 46,785,603
July 117,037,931 202,471,301 45,738,394
August 117,018,957 201,647,011 44,778,724
September 116,287,730 202,349,860 46,613,366
October 119,010,969 201,447,094 47,023,401
Under the heading of "Canadian municipal securities and
British, foreign and colonial public securities other than
Canadian," the chartered ba-nks of the Dominion showed an
amount of $201,447,094 at the end of October, 1920. While
the banks' holdings of Canadian municipal, foreign and col-
onial securities are considerable, the above figure chiefly re-
presents obligations of Great Britain.
;
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January 7, 1921
THE MONETARY TIMES
37
In 1916 the Canadian banks loaned the British govern-
ment $100,000,000 for the purchase of munitions, and a sim-
ilar amount in 1917 for the purchase of wheat. These loans
were originally advanced on a three-years' basis, at a mod-
erate rate of interest, and renew&ls have been made from
time to time. Of this $200,000,000, one-quarter was paid off
during the first five months of 1920, leaving a balance of
$150,000,000.
From the following figures, which illustrate the trend of
the above mentioned account since the beginning of 1916, the
loans and repayments are readily apparent: —
January
February
March
April
May . . . ,
June , . . .
July . . . .
AuETUst
September
October
November
December
1916. 1917. 1918. 1919. 1920.
$41,746,948 $163,299,724 $235,989,801 $259,462,077 $249,413,578
44,503,218
44,384,303
93,052,670
. 106.680,437
. 124,637,308
. 148,916,278
. 153,319,333
182,808,459
178,893,152
178,624,830
178,833,219
167,769,412
182,461,263
176,249,192
161,162,630 176,015,496
163,380,276 172,639,288
165.470,146 218,405,643
167,758,788 224,093,823
242,256,480
250,422,761
260,978,605
269,102,070
266,226,264
265,155.438
252,239,043
250,698,255
260,254,056
248,398.067
253,518,074
269,422,466
260.003,939
258,504,084
256,617,235
264,147,015
263,490,909
264,235,984
255,098,813
255,684,576
253.341.708
265,239.781
234,608,866
223,709,931
214,768,123
206,129,314
206,534,560
202,471,301
201,647,011
202,349,860
201.447.094
Repay Balance by 1922
The remaining balance of $150,000,000 is now being re-
paid, and will be wiped out by May, 1922. On November 1
and December 1, payments of $5,000,000 were made, and it is
the intention of the British government to continue monthly
payments through 1921 and a part of 1922.
Great Britain still owes Canada about 180 millions, in
addition, which represents the credit balance due the Cana-
dian government on the various advances made mutually
by the two governments to each other to cover their respec-
tive war expenditures in the two countries. No arrangements
for the liquidation of this debt are known to have been made
as yet. The repayment of the other debt of 150 millions to
Canadian banks will, however, materially assist the credit
position of the Dominion, and bankers express much satis
faction that the account is being thus disposed of.
Deputy Secretary Trowbridge, of the province of
Alberta, announces that the total number of auto licenses
sold in 1920 is 38,050, as compared with 34,000 last year. It
was thought three months ago that the annual issue would
reach the even 40,000 mark before the end of the year, but
the drop in grain prices is held as accountable for the
slackening of auto purchasing during the fall.
400
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Value,
$
3,195,878.15
1,338,003.45
3,258,044.10
1,076,000.00
1920
were as follows
Bronze
pieces.
11,201,347
15,205,551
:-
Gold
pieces.
12135,889
171,042
1
Value,
$
661,326.47
832,404.40
4.86
Silver
pieces.
22,903,234
14,287,049
Value,
$
112,013.47
152,055.51
115,100.00
145,585.00
Note: The only gold pieces coined and issued were sovereigns.
38
THE MONETARY TIMES
Volume 66
BANK CLEAR.ING HOUSE FIGURES BY PROVINCES
1914
1915
1916
1917
1918
1919
1920
$
•2,536,795,848
2,797,227,774
1,397,358,249
561,899,682
399,965,267
78,259,921
100,280,103
215,941,751
S
2,411,073,625
2,786,449,334
1,557,815,247
371,713,657
308,837,076
77,058,264
104,414,590
188,526,217
$
§3,240,773,729
t3,939, 152,266
2,040,717,775
415,797,842
400,762,688
90,946,795
125,997,881
255,347,092
$
3,792,647.962
4,435,709,612
2,653.354,314
521,913,559
566,007,431
102,948,814
151,812,753
340,238,760
$
14,326,431,476
5,114,234,344
2, 395, 388,. '■07
670,405,480
568,848,622
117,133,609
215,259,297
368,631,391
$
5,479.295,137
6,595,339,437
2,353,647,0.S2
804,018,563
650.034,151
153,139,927
241,. 300, 194
424,504,941
$
6,904,908,623
7,540,531,459
3,057,452,638
1,061,107,104
805,818,885
193,761,263
255.678,397
464,296,936
Quebec
Manitoba
British Columbia. ....
Alberta
New Brunswick
Saskatchewan
Total
8,087.728,595
7,805,888,010
10,509,496,068
12,564,633,205
13.776,332,726
16,701,279,382
20,283,555,305
•Peterboro started June, 1914. fSherbrooke started February, 1916. §Kitchener started April, 1916.
IWindsor started April, 1918. •♦Moncton, started August, 1920.
BANK CI^EARINGS BY CITIES— MontK by MontH
Clearing House
Brandon
Brantford
Calgary
Edmonton
Fort William
Halifax
Hamilton
Kitchener .......
Lethbridge
London
Medicine Hat
Moncton
Montreal
Moose Jaw
New Westminster .
Ottawa
Peterboro
Prince Albert. . .
Quebec
Regina
St. John
Saskatoon
Sherbrooke .
Toronto
Vancouver
v^ictoria
Winnipeg
Windsor
January
1920
$3,129,439
5,687,152
37,638,201
24,488,025
3,120,439
21,488,859
29,168,399
5,092,879
3,338,654
15,978,011
2,241,896
614,027,196
7,060,890
2,551,285
40,971,148
3,862,216
2,090,029
27,449,109
18,129,119
14,937,167
8,773,312
4,985,900
447,974,237
65,698,847
11,609,302
206,96.3,731
10,819,497
Total . I $1,639,274,939
February
1920
$2,497,698
4,774,589
30,013,304
19,650,940
3,528,317
16,013,622
24,675,066
4,002,016
2,787,419
12,774,846
1,632,528
March
1920
$3,106,770
6,031,500
37,403,388
25,069,355
3,486,860
19,820,570
31,324,956
5,432,722
3,533,432
15,572,717
1,995,363
538,611,264
5,627,802
2,418,964
34,031,-304
3,177,888
1,709,674
24,960,565
13,112,007
11,727,802
7,281,662
3,873,412
390,838,269
62,489,007
11,160,924
168,615,962
10,238,521
$1,412,225,372
568,4.'>2,098
7,097,665
3,149,518
40,941,647
4,064,579
2,112,950
27,698,374
17,681,764
15,039,493
9,120,115
4,695,884
439,181,926
74,994,746
12,150,766
191,763,117
13,631,266
$1,584,553,531
April
1920
$3,167,430
7,025,759
34,126,554
31,903,710
3,591,254
19,882,133
33,500,454
5,345,694
4,588,282
16,777,458
1,913,617
531,665,934
7,-379,639
3,170,336
41,675,434
4,692,080
2,066,412
30,339,053
18,597,852
14,9.52,029
9,812,068
5,322,547
463,804,088
71,765,-S97
11,914,125
188,183,383
13,742,647
$1,580,905,369
May
1920
$3,248,893
6,780,005
32,058,375
26,861,996
3,653,762
22,819,768
33,509,584
5,715,514
3,443,760
17,613,415
2,071,857
599,923,247
6,770,000
3,170,050
55,275,196
4,370,357
1,999,617
31,456,221
18,063,874
16,480,743
9,549,685
5,829,361
460,896,938
71,884,569
11,859,319
211, ,529,743
14,597,735
$1,681,439,584
June
1920
$3,390,494
6,480,618
30,214,716
21,742,949
3,984,840
24,586,070
32,859.435
5,889,216
3.287,464
19,167,708
2,098,749
612,-304,115
7,298,373
3,464,109
45,680,127
4,531,024
1,998,203
32,859,435
18,746,168
16,335,209
9,636.882
5,297,976
469,284,720
73,870,444
12,478,128
182,749,256
14,461,131
$1,664,697,559
Clearing House
July
1920
August
1920
September
1920
October
1920
November
1920
December
1920
Brandon .....'
Brantford
Calgary
Edmonton
Fort William
Halifax
Hamilton
Kitchener
Lethbridge
London
Medicine Hat ... ,
Moncton
Montreal
Moose Jaw
New Westminster.
Ottawa
Peterboro
Prince Albert . . . .
Quebec
Regina
St. John
Saskatoon
Sherbrooke
Toronto
Vancouver
Victoria
Winnipeg
Windsor
$3,523,792
6,507,651
32,758,119
21,110,274
3,943,737
24,520,960
34,312,4.54
5,312,854
2.936,846
16,409.122
2,043,720
Total .
647,820,992
7,450,168
3,120,751
38,188,647
4,385,513
1,993,060
34,892,388
18,211,891
15,961,197
10,037,638
6,071,296
447,270,993
76,934,040
14,670,096
187,417,562
16,647,014
$3,086,815
5,775,195
30,434,969
21,767,146
3,525,798
20,-553,413
30,270,697
4,836,003
3,600,231
14,878,915
1,84-5,928
2,451,731
576,939.686
7,201,741
3,063,053
33,008,013
3,764,802
1,977,068
29,698,617
17,168,314
16,004,679
6,550.691
5,671,186
406,191,434
74,858,240
11,144,187
184,981,567
13,859,1.56
$3,182,754
6,574,696
36,447,175
22,715,293
3,805,695
22,421,025
31,836,176
4,720,901
3,927,345
14,676,204
2.465.692
3,513,528
556,543,834
7,723,012
3,077,724
35,473,726
4,235,936
1,666,781
30.648,095
18,316,105
13,253,567
9,632,660
5,524,034
414,156,433
77,437,078
11,727.457
245,98-3,823
15,371,371
$4,225,687
6,4v0,122
47,454,614
24,057,805
4,437,-543
19,808,840
34,241,010
4,644,363
5,410,618
16,201,449
3,337,120
3,395,827
619,293,513
10,428,515
3,049,225
45,231,603
4,7.S6,793
2,025,551
30,351,-356
23,904,262
13,620,854
11,608,900
5,476,598
474,916,435
72,563,504
13,709,053
414,840,605
16,478,472
$4,688,149
6,651,144
48,407..332
27,798,216
5,107,407
23,812.271
33,261,308
5,395,160
5,347,988
16,980,248
3,385,257
3,843,638
652,846,705
10,886.385
3,145,045
57.308,879
4.395,692
2,184,122
34,276,795
25,881,328
14,297,754
12,668,947
5,668,353
494,365.696
75,231,039
11,718,439
429,192.133
15.512.541
$1,684,452.775 $1,535,109,275 ' $1,607.058,120
•1,935,870 237
$2,034,256,971
$4,150,418
7,394,518
41,116,330
26,103,653
5,023,226
19,950,866
31,774,421
5,193,175
4,465,827
15,127,876
2,776,853
3,886,152
590,760,454
9,654,142
3,118,277
47,220,857
4,422,908
2,222,769
32,565,553
22.456,612
14,161,893
10,730,512
5,630,313
501,323,633
81,174,710
11,565,350
403,8-33,417
1-5,906,848
1,923,711,563
January 7, 1921
THE MONETARY TIMES
39
CANADIAN BANK CLEARINGS
The following: lable gives the yearly total clearings of each house since its commencement :-
(Note. — In practically all cases the first figure is for a broken period.)
City
1889
1890
1891
1892
1893
1894
1895
1896
1897
1898
1 E
2 E
3 C
4 E
5 F
B h
7 V
8 1
9 L
10 L
11 t>
12 A
13 A
14 A
15 ^
16 C
17 F
18 F
19 C
20 F
21 S
22 S
23 S
24 1
25 V
26 \
27 \
28 \
$
s
«
%
$
%
s
s
s
c
rantioru
lalifax
47.534.252
62.281,748
64.601,913
10,320.134
59.872.489
38.306.280
60,381,918
37,824,976
58.778.698
34.307,856
60,978,524
34,277,878
61,237.206
33,753.865
63.513,838
33,350.542
61.942.831
35.637.364
fhh 1«
H ^ ' ■
onaon. ... ....
1^ ct"^
lontreal
454.528.000
473,984,000
514,607,000
590.043.000
568,732,000
546.600.000
583,160.000
,527.851,000
601.185.000
732.262.000
J. Westm'ster
f h
Alh *■
,'"' t,^ ''
juepec
20,284.420
30.109.575
30.349.265
. ■ . ° ,
oronto
145,897,939
326,564.323
309,278,689
279.270.739
308.636,044
342.031.851
371.456.867
437.661.654
8.414,923
H ^n a
5,931.409
50.602.648
55,873,630
1,042,926,076
64,146,438
84.435.832
90,724.325
$502,082,252
$536,265,748
735,426,986
1.014.786.092
976,217.583
969,559.941
1.049,304,780
1.184.051.654
1,402,923,771
1899
1900
19U1
1902
1903
1904
1905
1906
1907
1908
1909
$
s
s
$
$
s
$
*
$
S
2.
3
"•;■;■■;■■;;; ;;;;';;;
41,771,924
20.083.179
69,745,006
45,916.792
64,815,227
38,496,509
99,453.662
51.561.012
j
6
7
8
9
70.600.705
40.298,084
77.594.871
40.262.588
87,161,888
42,554,583
,S8,532,368
45,965.217
93,349.633
53,419,704
90.115.784
59.003.094
89,251.562
68.385,601
92,468,040
78.480.620
93.587.138
88.163,279
90,232,247
72.333.062
95.278.468
84,803.936
23,097,509
42.848,581
45.552.230
50,429.505
58.063,826
65,770,473
56,875,041
62,093.337
12
13
•
794.029,000
73(),933,o66
889,479,66b
1,098,970,000
1,113,978,000
1.065.067.000
1,324,313,000
1,533,597.000
1,555,729,000
1,467,316,000
1.866.649,000
\*
29,200,088
96.445,291
106,083,750
106,637.587
120.891,877
135,866,735
156.487.801
154,367,756
173,181.973
17
18
1
48,177,614
73,881,253
80,794,414
77,649.688
86.734,553
92.934,213
107.460.897
111,812,551
118.803.773
20
21
22
23
24
25
26
27
28
32,922,509 1 36.001.574
40,072,689
41,702,253
48,950,500
50.756.315
52,836.333
60,601,241
66.150.414
66,435,636
72.404.500
504,872,846 ; 513.696.401
37,802,218 ! 46.644.098
33,199.807 1 32.779,919
625,271.306
47,006.211
30,801.369
809,078,559
54,467,549
28,580.751
808.748.260
66.215.765
30,818.426
842.097.066
74,029.902
33.070.009
1.047.490.701
88.460.391
36.890.464
1.219,125.359
132.606.358
45.615.615
1 228,905,517
191,734,480
55,339,588
1,166,902,436
183,083,446
55,356,013
1.437.700.477
287,,528,944
70,695,882
107,786,814 106,956,792
144.199,483
188,370.003
246.108.006
294.601.437
369.868,179
504.585,914
599,667,576
614,111,801
770,649,322
1,621,511.983 1,584,869,243
1,983,924.231
2,549,090,693
2,691,315,039
2.738.580,112
3,335.552.166
4,015,800.024
4,324,648,961
4,142,137,725
5,204,957,530
1910
1911
1912
1913
1914
1915
1916
1917
1918
1919
1920
1
2
3
4
6
7
8
9
10
11
12
13
14
IS
16
17
18
19
20
21
22
23
24
25
26
s
21 ,278,869
" 150,677.031
71,635,122
95,855,310
101,226,496
s
29,430,274
27,206.985
218,681.921
121,438,391
7,865,923
87,994.038
125.250.982
s
32,875.875
30,749,317
275.492,303
220.727.617
40,503.087
100.467.672
167.712.729
"33,485,947
84.526,961
s
32,186.498
32.697,443
247,882.928
213.0.53,218
49.265,358
105,347.630
178,107.853
28.893,876
90,720,202
21 106,215
$
26,397,443
28,669.309
201.669.873
157.308,683
39,110,558
100,280.103
148,934.586
" " 21.217',849
86.024,236
19,768,862
$
27,132.123
26.640.280
169.758,599
105.834,955
24,674,847
104,414,590
151,420.271
19.740,328
89.774,787
13.503.194
S
28.922.518
34.243.297
233.097.671
114,345,%4
27.472,160
125,997.881
200.811.087
20.201,665
31,648.551
100,090,560
21,670,502
s
30.429.612
42.189.449
348.663.426
142.606,772
34,224,050
151.812.753
244.401.339
30,268.621
45.021,074
112,664,207
29,716.159
$
32,654,296
48,141,451
331,334,577
171,524,924
38,313,344
215,259,297
262,076,476
32,549,572
41,901,108
126,958,350
24,088,013
$
36,922,769
57,825,305
355,009,588
233.066,5*0
41.224,768
241,300.194
306,370,966
48,244,693
38,179,533
164,126,856
23,778.450
$
41,398,339
76.108,949
438,073.077
293,269,362
47,209,878
2.5S.678,.397
380,733,960
61.580.497
9,378.091
67,154.297
28.818.693
71.554.221
45.667,866
192,157,969
28,808,580
17.090.876
2.088,558,000
2.368,491.239
39.872,743
2,845,468,033
65.136,326
2,879,118.859
61,370,943
28.424,494
207.667.008
2,631.354,533
45 846,371
19,284.692
209,662,599
11,338,896
12.574.904
165,873,241
98,205.535
78.259,921
59,314,941
2,628,123,428
42,634.319
■13,460,082
211,636,519
20,970,664
8.622,444
158.325.906
87.122.611
77.058.264
50.146.843
3,722,609,663
52,971,442
13,878,003
261,049,599
26,675,636
9,709 906
192,163 703
I24,349„591
90,946.795
68.316.153
24,378,900
2,570,229,725
321,588,718
■ 80,331,121
4,188,2,55.210
64.896.741
17.480.445
291.197.713
32.917,018
11,811,256
213,.504,960
169.800,113
, 102,948,814
93.730,650
33,949,442
3,004,783,565
419.610,898
84,822,216
4,833,924,041
78,425,563
23,565,159
357,598,753
37,574,621
14,149,320
237,904,224
184,624,626
117,133,609
91,431,882
42,406,079
3,379,864,506
545,368,714
101,471,607
43,3,54,403
2,362,734,211
6,254.781.093
86,347.586
28 714.013
472.691.921
• 41.376.004
21,280.641
290,983.483
210.989,136
153.139,927
105,887,578
49,574,861
4,251 644,303
655,913,205
119.391,345
95,790.321
2.316.724,263
7.109.189,038
94,578,332
193,714.888
213,952,292
244,123,451
515.006.581
50,639.788
8,545,562
158,760,185
115.727,647
88,969,218
115,898.467
22,936.528
165.654,745
132,087,457
82.447,747
96,034,717
24.046,236
123.710.055
50.739 159
77.843.546
9,004,823
133,319.176
73,032.088
77,328,182
63.557.142
367.295,561
230,269,296
176,670,387
115.403,072
64.046.860
1,593.954,2,54
444,988.818
101,567.074
1.852,397,605
543,484.354
134,929.816
2,160.230,376
645,118,877
183,544,238
2.1S1.281„577
606.899.710
176.977,074
2,013,055,664
420,951,718
121,663.272
1,885.956,257
281.575.949
76.677.626
5.410.204,802
878.901.621
145.707.146
171,266.199
28
953,415,182
1.172.762.142
1.537.817,524
1.634.977.074 , 1.370.960 806
1.530.683,124
2,011,795,257
2,622,924,702
3.016.054.299
6.154,701.015
7.391.368.207
9,155,881,412
9.275.139.154
8.087.728,595
7.805.888.010
10,509,496,068
12,564,633,205
13,776,332,726
16.701,279,382
20,283.555.305
THE MONE, TARY TIMES
Volume 66
The Trust Companies' Business in 1920
Scarcity of Funds for Investment was Outstanding Feature of the Year— Capital
Needed for Development of Farms and Industry— Succession Duty Legislation in
Ontario— Law Respecting Beneficiaries— Growing Appreciation of Trust Company Service
By ROBERT BEATTIE
National Trust Co., Toronto
T^HE scope of the business of Canadian trust companies is
•*■ now so well known that there would be little value to
such a paper E'S The Monetary Times, in any resume of the
work they carry on. The public is coming more and more to
realize that the business of a trust company is to exercise
the various functions which trustees exercise, and to see that
there are advantages in having these functions carried out
by corporate bodies instead of by individuals. Accordingly,
the trust comp&nies have had steady and satisfactory de-
velopment of their business as ej^ecutors and administrators,
and in the various other trusteeships which modern business
requires. The purpose of this review, however, is not to dwell
on this development, but merely to refer briefly to certain
points of special interest and concern to which the attention
of trust company officials has been directed during the year.
Shortage of Capital
The outstanding feature of the past year has been scar-
city of funds available to the lending corporations for invest-
ment. The significance of this fact from the n&tional point
of view will be recognized if it is borne in mind that the
development of Canadian agriculture depends to a very con-
siderable degree on the moneys loaned to Canadian farmers
by Canadian loan and trust companies.
In the past funds have reached the farmers from two
sources. The first source was formerly the savings of the
people in European countries, notably Scotland, Holland, Bel-
gium and Prance, who, prior to the war, sent through Euro-
pean agencies and Canadian trust and loan companies large
sums for investment in Canada. The European requirements
of capital for war purposes combined, with adverse exchange
rates during the war, to slacken the flow of funds. In
the later stages of the conflict, European capital became
increasingly difficult to obtain, and since the war it has be-
come impossible to send money profitably out of Europe for
investment. This source of supply has therefore been cut
off. At annual meetings of trust companies during the year
it was pointed out — and up to the present the statement has
proved true— that for an indefinite time Canada would be
thrown more and more on her own resources for the capital
needed for her development. Contrary to what might per-
haps have been expected, the United States has not yet
furnished any considerable amount of money for Canadian
mortgage loans. Although present exchange conditions offer
American investing corporations advantages in this field, the
demand for farm loans in the United States has so far been
strong enough to prevent American capital from seeking
this Canadian outlet.
The other source from which money formerly re&ched
the' Canadian farmer was the funds which the trust and loan
companies administer as part of the assets in their care or
themselves own — their capital and reserve. So far as the
trust companies are concerned, this is now aJmost the only
source available for mortgage money. With the general
increase of trust company business, it has grown substan-
tially. Competing with the demand for farm loans, however,
is the need of municipalities and industries for capital, re-
sulting in offerings by such corporations of bonds &t attrac-
tive rates. Many trust company officials feel, therefore, that
the domestic source of supply above mentioned is not likely
to be by any means sufficient to meet the probable early
needs of the country for capital. Already at least one of
the provincial governments has undertaken a n&tional cam-
paign to sell bonds with the object of lending the proceeds
to farmers. Another has opened savings banks in an effort
to supply funds for farm development. These are only two
of the many signs which show that in order to discharge
their function in the community — to provide sufficient funds
so that governments shall not be obliged to exhaust their
credit (already strained to take care of the recognized public
undertakings and services) in financing private enterprise —
the companies will have to make every effort consistent with
their duty to their clients to attract funds for investment on
mortgage security.
Outstanding Loans In Good Condition
On the other hand, the outlook for loans already made is
of the brightest. There is every prospect that the f&rmers,
after the marketing of the crop of 1920, will have funds to
meet all their commitments. Their need for capital will,
however, be none the less, because it is these very successful
farmers who should develop mixed farming. This will make
them borrowers of the highest class of such funds as the
companies have available. Their assets already developed
will give them ample security for necess&ry loans, and their
borrowings will be invested in the erection of new buildings,
the purchase of better stock, and generally in the improve-
ment of their holdings. During the past few years the im-
provement along this line, in the west particularly, has been
phenomenal. The rude farm shacks, which at one time were
fairly common in some sections, have given place to sub-
stantial dwellings. Improved barns &nd outbuildings and
increased farm machinery, have replaced the eai'lier limited
equipment. Electric light, motor transit, better roads and
telephones have broken down the isolation which used to
make life in the farming districts difficult. The faith of
those who early saw the future of Canada's vast spaces is
being completely justified.
Succession Duties
Another field is of interest to trust companies — the field
of legislation dealing with property. The year just ended
has seen several new laws passed which affect their dealings
with property in their charge. In Ontario the most important
law, perhaps, has been the Succession Duty Amendment Act,
passed e.-t the late session of the legislature. In the form'
earlier proposed, this law contained changes which were far-
reaching, but it was so modified subsequently, that it refers
in its final form only to the exemptions of estates from death
duties and to the rates payable on estates of various sizes
passing to various classes of beneficiaries. In 1905 estates
aggregating $50,000 or less were exempted from taxation if
they passed to lineal beneficiaries. This exemption was sub-
sequently reduced to $25,000. As a result of other changes,
of which the one of the past ye&r is the latest, only estates
of $10,000 or less are exempt if passing to near collateral
relations, and only estates of $5,000 or less are exempt if
passing to remote collaterals or strangers in blood.
Another change brought about by the recent Succes-
sion Duty Act refers to the administration of the law. Under
former arrr.-ngements the Succession Duty Office was re-
quired to satisfy itself that there had been no undervaluation
of the assets which came under its survey. This duty is now
transferred to the Surrogate Judge concerned with the pro-
bate of the will. The duty of making the valuation remains.
January 7, 1921
THE MONETARY TIMES
of course, where it has always rested — on the executor of
the estate.
Beneficiaries
Another Ir.w recently passed which aifects the procedure
of the companies, concerned as they often are in the tracing
of missing- beneficiaries of estates in their charge, is the
Absentee Act, passed also last session in Ontario. This act
provides that the Court may declare a person an absentee.
An absentee it defines as "one who having had his usual
place of residence or domicile in Ontario, has disappeared,
whose wherec.'bouts are unknown, and as to whom there is
no knowledge as to whether he is alive or dead." The Court
may also make an order for administering the property of
an absentee and a committee may be appointed for the pur-
pose. The powers and duties of the committee are the same
as those of a committee of the estate of a lunatic. The act
specifically provides that a trust company with or without
one or more persons may be appointed such a committee.
The last legislation to which attention should be drawn
in an article such as this is the new bankruptcy law of the
Dominion, which went into force in July. The adv&ntages of
this act in making uniform the regulations of all the pro-
vinces dealing with this import&nt matter are obvious. So
far as the trust companies are concerned,, the law has been
in operation too short a time as yet for a forec&st to be
possible of its defects on their work. That trust companies
have superior facilities for the performance of the duties of
trustees in bankruptcy, as well as those of receivers, liqui-
dators and assignees, no one acquainted with their organiza-
tion will question. Their offices are in ma-ny cases distributed
throughout the country, and each oflice staff includes experts
with long training and intimate acquaintance with local con-
ditions. Trust company officials generally believe that as
time goes on the amount of work of this kind which they are
asked to perform will' become very large.
The Volume of Business
The editor of The Monetary Times hais suggested that its
readers might like to know "how trust companies get their
business." It is not easy to give an accurate and confident
answer to this question, since although the companies know
what are the influences which lead a man or woman to en-
trust his or her affairs to them, it is very difficult for them
to class these influences in the order of their power or im-
portance. The comp&nies would agree that one of the most
important causes of their appointment to positions of trust,
is the advice which solicitors give their clients. Another
factor is the high reputation of the individual company- —
direction, executive and staff. This explains, however, rather
the appointment of one company instead of another, than the
appointment of a comp&ny instead of a person. Perhaps the
most valuable influence is that of satisfied clients and bene-
ficiaries: for it holds in the trust company business as in any
other that the best advertisement is a satisfied customer. It
remains to name advertising as the means by which the
compE^nies try to find new clients to satisfy. In recent years
most companies have made steady efforts to explain their
service to the public, and there can be little doubt that gen-
eral knowledge of the duties which the companies perform
is growing.
Canadian Banks Expand in Foreign Field
Movement of 1919 Continued in 1920— Montreal Makes Important Connec-
tion, and Commerce and Royal Increase Branches in South — Foreign
Branches Bring Capital to Canada— How They Help the Canadian Exporter
By G. F. Towers, B.A.
Superintendent, Foreign Trade Department, Royal Bank of Canada
THE year 1920 has been one of development for Canadian
banks abroad, a development accomplished partly by means
of alliances with established banks, partly by the opening of
foreign branches of our own institutions. Last year's Annual
of 77(1' Monetary Times signalled the entry of the Royal
Bank of Canada into Argentina, Uruguay and Brazil, where
branches were established at Buenos Aires, Montevideo and
Rio de Janeiro respectively. The same review noted the con-
nection of the Dominion Bank with the British Overseas Bank,
Ltd., head office London, an organization formed to handle
foreign trade, and also the affiliation of the Union Bank of
Canada with the Park Union Banking Corporation, operating
in the far east. Branches of the latter had even then been
opened in China and Japan.
The Year 1920
Developments of this nature have gone on in force during
1920. The Bank of Montreal acquired an interest in the Colo-
nial Bank, a British organization with strong connections
through the British West Indies. The Canadian Bank of Com-
merce entered the Caribbean- field, and by November 30th last
had established branches in Havana, Cuba, and Kingston,
Jamaica. They had fui'ther announced their intention of com-
mencing business in Rio de Janeiro, Brazil, and Port of Spain,
Trinidad. Finally, the Royal Bank of Canada, throughout the
year, pursued its policy of expansion, increasing the number
of its branches in Caribbean countries, and opening in Barran-
quilla, Colombia, and Santos and Sao Paulo, Brazil. This
bank now covers all the islands of the Caribbean and seven
countries in Central and South America. The total number of
foreign branches of Canadian banks is now probably one hun-
dred and fifty, not including their offices in Newfoundland.
This compares with little over one hundred branches on Octo-
ber 31st of last year.
Foreign Deposits Increase 40 Per Cent.
The growth of old branches and establishment of new of-
fices have been reflected in the figures of the monthly state-
ment of the chartered banks to the Dominion government.
The increase in foreign deposits has been striking. On Sep-
tember 30th, 1919, the consolidated monthly return showed
$255,000,000 under the head of "deposits elsewhere than in
Canada." This amount had increased about 40 per cent., to
$355,000,000, by September 30th last. Of the $100,000,000 in-
crease the Royal Bank of Canada contributed $67,000,000, the
deposits in their foreign branches increasing in the twelve-
month period from $113,000,000 to $180,000,000. During this
40 per cent, increase in foreign deposits Canadian notice and
demand deposits increased a little less than 4 per cent., and
total assets of all Canadian banks about 10 per cent.
Current loans and discounts elsewhere than in Canada are
always less than foreign deposits. On September 30, 1919, the
former were $151,000,000. On September 30, 1920, they stood
at $202,000,000, or about 57 per cent, of the foreign deposits
on that date. The idea that foreign expansion of our Cana-
dian banks would divert to other countries the capital urgently
required for Canadian development should by now be thorough-
ly discredited. It is interesting to note that at the time when
exponents of this theory were most numerous in Canada they
were also in force in the countries where our banks were lo-
cating, the only difference being that the contention of the citi-
zens of these countries reversed the Canadian viewpoint, since
thev claimed that the foreign banks in their midst diverted
THE MONETARY TIMES
Volume 66
local capital to the countries where the banks' head offices
were located.
Detailed figures of changes during the twelve' months end-
ing September 30th last are given below: —
All Canadian Chartered Banks — Fisures of Deposits, Etc.,
Elsewhere Than in Canada
Sept. 30,'19 Sept. 30,'20 Increase
Deposits $255,274,256 $355,238,992 $99,964,736
Current loans and dis-
counts 151,814,511 202,590,184 50,774,673
Due to banks and bank-
ing correspondents 37,433,749 63,667,391 26,233,642
Due from banks and
banking correspon-
dents 59,644,718 73,476,022 13,831,304
Call and short loans__ 169,532,489 186,962,960 17,430,471
Our Foreign Trade and Foreign Banking Status
Canada's foreign banking system is an organization sin-
gularly complete for a country of this size. It is perhaps lit-
tle realized how comparatively far advanced Canada is in this,
as in other aspects of our foreign relations. Argentina has as
large a population, Brazil a much larger one, yet, leaving for-
eign-controlled banks out of consideration, neither country has
anything approaching the foreign or domestic banking sys-
tems possessed by Canada. England's wonderful foreign
banking organization reached its present position after seven-
ty-five years of development. The United States, on the other
hand, had no real organization of this sort until after the com-
mencement of the war. The need for it was felt long before
it came into being; and the speed with which it had to be cre-
ated, joined to the lack of anj'thing to build on, greatly in-
creased the difficulties which have always to be faced by any
expanding organization.
A survey of Canadian foreign trade figures, from the
point of view of Canadian progressiveness, reveals a some-
what similar situation. In the fiscal year ending March 31,
1918, Canadian exports and imports were valued at over two
and a half billion dollars, or three hundred dollars per head of
our eight and a half million people. England's foreign trade
was $277 per capita during approximately the same period;
that of the United States — the enormous figures of which
have been given so much publicity — was only $97 per capita.
India and China, thickly populated but poorly developed, have
respectively a per capita foreign trade of $5 and $3 per annum.
The transaction of foreign business on this scale, and the
provision of facilities for financing the major portion of it, are
phenomena not ordinarily seen in a country of our size and
stage of development.
Export Trade
A year ago the surveys of 1919 which were being pub-
lished were able to review a year of unbroken prosperity.
Agricultural, manufacturing, wholesale and retail distributing
industries — all were on the crest of the wave; and if Cana-
dian foreign trade did not equal the record of 1918, it was still
very lai'ge, and showed a surplus of exports amounting to
three hundred million dollars for the year. In many lines the
question was more one of supply than of demand. So strong
was the buying power of the domestic market that export
trade was not of primary interest to many manufacturers,
though much was said and written about it. The present situ-
ation is far from being equal to that of last year. 1920 will
be a record year for some industries. Others have already
been hit by the slump. But all now realize that readjustment
is at hand and that the pi-ospects for 1921 are uncertain.
There will be more reason to cultivate export trade at a time,
however, when other countries will be suffering from the same
difficulties as ourselves. Competition will be keen, orders dif-
ficult to secure, and when secured should be accepted only
after a most careful investigation of the credit standing of the
intending purchaser.
What Canadian Banks Can Do
Our Canadian bank branches abroad are going to be of
great assistance in this period. They are ready to help Can-
adian industries and export trade in any possible way. The
supplying of information on foreign markets and conditions,
and on foreign exchange, is one of the first services they can
render. They ai'e often in a position to put Canadian manu-
facturers in touch with foreign importers. Any actual busi-
ness obtained naturally depends on the cost and quality of the
product. Canadian banks with foreign branches or affilia-
tions, by reason of being closely in touch with foreign condi-
tions are in a better position to discount their clients' documen-
tary drafts on recognized foreign houses than they would be if
they had confined themselves to domestic business, since it is
quite possible that they will know the foreign firm in question
or hold private reports on its responsibility. The most im-
portant service is, of course, the supplying of full credit infor-
mation on foreign houses to Canadian business men. The
necessity of obtaining this through doubtful or unfamiliar
sources would have a tendency to lessen the confidence of Can-
adian houses in the value of the reports and to increase the
difficulties of the Canadian manufacturer who was endeavor-
ing to book foreign orders. Happily this necessity does not
exist as far as many countries are concerned. Canadian firms
are at liberty to take full advantage of the facilities offered.
No charge is made, nor, as far as we know, is there any stip-
ulation that enquirers should be clients of the bank concerned.
RURAL CREDITS MOVEMENT GROWS IN MANITOBA
Twenty New Societies Organized in 1920, and Loans
More Than Doubled
MANITOBA'S rural credit system had another year of ex-
pansion in 1920. This is the only province which has
such a system in active operation, but some of the other prov-
inces have taken steps in this direction. Ontario appointed
a commission last year to enquire into the subject, and a re-
port is expected shortly. Regarding progress in 1920, C. N.
Gifford, supervisor of the Manitoba system, said in a state-
ment to The Monetary Times: —
"The Manitoba Rural Credits Act has been in force about
three and a half years. The following table shows the growth
in the number of societies and the business done: —
Amount of
Year No. of societies loans granted
1917 1 $16,600
1918 10 215,581
1919 38 1,051,876
1920 58 2,480,345
More Being Formed
"While we have only 58 societies in actual operation there
are ten more to which charters have been issued, and which
are in the formation stage. The number of farmers who are
members of the societies would be slightly over 4,000, with
510 directors.
"A combined financial statement of the 38 societies doing
business in 1919 shows them with an authorized capital of
$760,000, a subscribed capital of $429,950, and a paid-up cap-
ital of $64,175. Of the unpaid capital $168,000 represents the
balance on their shares which the pro\'ince of Manitoba and
the rural municipalities can be called on for; $58,573 of the
paid-up capital is invested in municipal, school district and
government bonds.
"The societies operate on a 1 per cent, margin; after pay-
ing all expenses they show a net profit of $3,200. After a
society has been operating two years they cannot only pay all
expenses but show a good surplus, which is being used to
create a reserve fund to take care of any loans that might
occur. So far not one dollar has had to be written off.
"During 1920 part of the loans were carried by the banks,
but the largest part of the funds for loaning were borrowed
by the societies from the provincial government.
"Our loans are practically all due in December. We have
due up to November $130,000. To date (November 19th) our
collections amount to $124,780."
January 7, 1921
THE MONETARY TIMES
Bank Loans in Relation to Deposits
Loans in Canada Increased by $359,000,000 — While Increase in
Deposits Was Only $79,000,000— This Demand for Funds Naturally
Strained Banking Facilities — All Classes of Borrowers Affected
By O. A. HARPER
Manager, Sterling Bank, Winnipeg, Man.
*' A RE we going to let the east shut off our credit like
■^*- that?" or words to that effect, is a question recently
asked the writer by a man well versed in business. We were
discussing the affairs of a certain wholesaler whose matur-
ing payments were being demanded by eastern manufac-
turers. To all appearances he is solvent but requires an ex-
tension of time to meet payments. He has not been able to
sell or collect for his stock as expected. Trade is dull in
his line and his shelves are full in the face of falling prices.
This question expresses a sentiment that is causing a
sectional division in the Dominion which, if allowed to grow,
will seriously retard recovery from a trade depression felt
in east and west alike. Is it reasonable ?
Stringency is a General Condition
One cannot lend what he does not have. Working from
this premise, examine the financial condition of the country
which is reflected in the loans and deposits of the chartered
banks. Some of the figures given in The Monetary Times of
November 5 may well be repeated. These figures show that
neither eastern manufacturer, western wholesaler, banker,
nor any other individual, class or section, is alone respon-
sible for the present tight money condition. The mass of the
people as a whole are responsible. They must produce more
than they consume and save substantially before they can
expect increased credit facilities.
The last government return of the banks available at
time of writing is up to the end of September, and figures
of demand or current account and savings bank deposits for
the preceding twelve months are as follows: —
Deposits payable Deposits payable
on demand. after notice.
1919— September . . $650,743,015 $1,227,4.37,715
October 705,280,241 1,262,746,984
November 728,657,589 1,137,858,277
December 703,329,292 1,138,086,691
1920— January 621,408,024 1,163,297,037
February 620,069,555 1,187,027,307
March 657,412,028 1,197,719,570
April 652,918,760 1,209,573,990
May 645,957,229 1,229,073,515
June 659,622,583 1,243,700,977
July 639,415,025 1,253,170,443
August 640,361,707 1,261,647,732
September 677,286,905 1,270,194,097
It will be noted that there is an increase in demand de-
posits for the year, of almost $27,000,000, but as these funds
are for immediate current use, they cannot be relied on by
the banks as a basis for extending credit. Notice or savings
bank deposits show an Increase of almost $53,000,000, mak-
ing a total increase in deposits of only $79,000,000. As
against this, note the following figures for commercial loans
for the same period: —
Current in Call in
Loans. Canada. Canada.
1919— September $1,058,572,202 $ 96,912,709
October 1,104,940,160 100,549,390
November 1,189,408,423 121,754,469
December 1,207,109,046 125,888,760
1920— January 1,226,962,963 132,015,334
February 1,257,015,902 127,251,919
March 1,322,267,030 128,233,310
Current in Call in
Loans. Canada. Canada.
April 1,347,238,230 125,644,859
May 1,349,079,981 119,114,493
June 1,365,151,083 115,272,587
July 1,377,276,853 115,360,894
August 1,385,470,153 113,598,923
September 1,417,520,756 114,669,611
Loans Have Outrun Deposits
There was an increase in commercial loans in Canada
for the twelve months of $359,000,000, as against the in-
crease in total deposits of $79,000,000. Total commercial
loans amount to $147,000,000 more than the total savings
bank deposits. The answer to the thought underlying the
opening question of this article is contained in these figures.
Commercial loans in one year have increased $280,000,000
fa-ster than all deposits, and new loans cannot be extended to
develop future business unless promises to repay are kept
as they mature. The eastern manufacturer is in the same
position as the western wholesaler and every one else. He
must pay his bills as they fall due or business as a whole
must slow up or halt.
Where has this money to increase the loans come from
and who borrowed it? are two questions often asked.
Have Reduced Security Holdings
In answer to the first, I would point out, the bank state-
ment referred to show the banks have withdrawn $267,000,-
000 during the year from Dominion and provincial govern-
ment, municipal and other securities. The banks had pre-
pared for a readjustment period after the war. Even after
withdrawing the above amount from their liquid assets they
are in a very strong position, but they cannot continue to con-
vert their immediately available assets into commercial
paper and at the same time remain in a sound banking con-
dition. The baJance of the increase in commercial loans,
$20,000,000, was obtained from various sources in compara-
tively small amounts.
Who borrowed this money? The popular opinion is that
the profiteer has it to enable him to hold goods or grain for
exorbitant profits. No one considers himself the profiteer, so
all are ready to share the popular opinion and blame the
other fellow.
The manufacturers and the wholesalers always have
used a share of the loans, and it is natural to assume that
in the face of higher prices their loans are considerably
larger than in pre-war times. But as all loans and deposits
have grown since those good old days, it does not follow that
they have a larger proportion than formerly.
Loans to Farmers Have Grown
The farmers, and especially the western farmers, have
always required large credits during the spring, summer and
early fall seasons. There are good reasons for assuming
that this fall they have a larger proportion of credit than
usual.
First, — They have been operating under higher costs of
seed, labor and all the incidental expenses that enter into
farming.
Second, — Some sections of the western provinces have
had as many as three years' bad crops in succession. The
THE MONETARY TIMES
Volume 66
result is that loans in these sections have had to be carried
over and increased from year to year.
Third, — In these districts of bad crops, where farmers
were not in a position to warrant increased loans, the
governments or municipalities have assisted them to obtain
credit, with the result that many such loans have increased
and still remain unpaid.
Fourth, — The farmers depended on higher prices this
fall and had obligated themselves accordingly. Now, with
the prices down, many of them cannot realize enough to pay
all their debts, and many more refuse to sell their crops at
prevailing prices, with the result that neither their merchant
nor their banker is paid. The merchant must ask an exten-
sion from the wholesaler, who in turn asks an extension
from the manufacturer and thus all are prevented from re-
ducing their indebtedness. This latter condition also arises
from many other small consumers not meeting their local
bills promptly.
No analysis of loans as to the occupation or district of
borrowers is available, but if such an analysis could be made
it is fairly certain that the increased loans resulting in tight
money would be found to be spread over a^ll classes and
businesses, farmers included. Thus, instead of the blame
being placed on the east or the manufacturer, it would fall
on the public as a whole, who are not saving sufficient of
their production to develop a young and growing country.
No man can lend what he has not.
Dominion Note Circulation Around $300,000,000
Went Down in Midsummer But Rose Again in Autumn— Gold Reserve
is $27,000,000 Less Than Last Year — Securities Held Against
Dominion Notes Outstanding— Currency and the Movement of Prices
/CANADA'S government issues are based on a gold reserve,
^ the ratio of which, however, through the exigencies of war
finance, has been considerably reduced. The Dominion Note
Act of 1914, by which the issue is authorized, permits an issue
of $50,000,000 in the first instance against a reserve of 25 per
cent, of this amount in specie, any additional issue to be cov-
ered by an amount in gold equal to any issue in excess of
$50,000,000.
These requirements were modified subsequently by the
necessity of providing funds in connection with- the taking
over by the government of the Canadian Northern and the
Grand Trunk Pacific Railways. Sixteen million dollars was
required for this purpose and another $10,000,000 to meet
maturing obligations of the government in connection wit!
the war.
For the $16,000,000 securities of these railways are held
but are not included in the list of approved securities reported
in the government returns as held against issues of Dominion
notes. Virtually, therefore, issues of $76,000,000 are author-
ized against a reserve of $12,500,000 gold, or an uncoverec
issue of $63,500,000.
While the act calls for gold equal to any additional issue,
the Finance Act of 1914 permits advances to banks by the
issue of Dominion notes against approved security. This has
undoubtedly been availed of to a considerable extent in order
to provide the additional currency required to handle the bus-
iness of the country at the prevailing high prices. No exact
details, however, of the amount so advanced are given in any
of the returns published by the government, these advances
being apparently included in "Balances due to Dominion gov-
ernment after deducting advances for credits, pay lists, etc."
in the monthly bank statement.
Considerable Inflation
While there is ample security for the issue the ratio of
actual gold held has decreased materially since 1914, and as
the basis of our currency is gold, there is consequently infla-
tion in proportion to the decrease in the ratio of specie actu-
ally held. Considering, however, the strain on the finances of
the country by the war, as well as by the consequent disloca-
tion of trade, it is a tribute to the soundness of Canada's
financial position that this inflation is not far greater. To
realize this it is only necessary to compare the position of
Canada's currency with that of other nations. The value of
cux-rency compared with commodities, as shown in the whole-
sale prices current in different countries is a reasonable indi-
cation of the inflation of the currency. The September Com-
mercial Letter of the Canadian Bank of Commerce gives the
rise in these prices since 1914:
Per cent.
$92,000,000
81
89,000,000
59
114,000,000
65
119,000,000
67
114,000,000
41
118,000,000
39
Per cent.
Canada 150
Austr-alia 112
United States 112
United Kingdom 200
France 300
Italy 400
In France and Italy the percentage in the early part of
the year was considerably higher.
The government issues and the specie held against them
at the close of the fiscal year since 1914 were as follows:
1914 $114,000,000
1915 ^^— 152,000,000
1916 175,000,000
1917 178,000,000
1918 281,000,000
1919 229,000,000
In considering, however, the gold reserves of the country
and the outstanding circulation, the bank issues and the gold
held by them must be taken into consideration.
The total of Dominion notes outstanding over the period
of 13 months ended October 31, 1920, with the gold resei-^'e
and the amount issued against securities, is shown by the fol-
lowing table:
Notes Against
Securities
$146,020,000
162,957,000
154,237,000
$149,289,375
151,064,375
157,566,725
154,262,225
146,056,725
138,036,125
139,749,125
138,437,125
149,620,125
166,715,125
1919 — Total
October $311,639,746
November 328,010,829
December 318,690,089
1920 —
January $303,678,278
February 305,404,160
March 311,932,791
April 309,142,651
May 300,241,483
June 292,016,290
July 293,541,399
August 292,086,025
September 303,065,376
October 320,012,915
Gold Reserve
$122,633,554
123,719,093
114,821,962
$105,165,301
105,609,980
100,286,280
101,636,652
102,495,683
99,619,182
95,510,383
95,183,753
95,205,901
95,222,381
Since the inauguration of the drainage scheme in Mani-
toba, it is estimated that 3,200,000 acres of land, believed to
be unsuitable for agriculture, have been brought under culti-
vation.
January 7, 1921
THE MONETARY TIMES
45
siiiiiiiiinniuiiiiiiiiiiiiiiiiiiiiiiitiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiniiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiininiiiiiiiiiiiiiiiiiiiiiiiiiiiNiiiin^
{ The Royal Bank of Canada
INCORPORATED 18 69
CAPITAL AUTHORIZED
CAPITAL PAID-UP -
$25,000,000
$20,000,000
HEAD OFFICE
RESERVE FUND
TOTAL ASSETS
MONTREAL
$20,000,000
$580,000,000
JA.S. REDMOND
G. R. CROWE
D. K. ELLIOTT
HON. W. H. THORNE
HUGH PATON
BOARD OF DIRECTORS
SIR HERBERT S. HOLT, President E. L PEASE. Vice-President
A. J. BROWN, K.C. SIR MORTIMER B. DAVIS W. H. McWILLIAMS
W. J. SHEPPARD G. H. DTTGGAN CAPT. WM. ROBINSON
C. S. WILCOX C. C. BLACKADAR A. McTAVISH CAMPBELL
A. E. DYMENT JOHN T. ROSS ROBERT ADAIR
C. E. NEILL R. MacD. PATERSON T. SHERMAN ROGERS, K.C.
E. L. PEASE, Managing Director
C. E. NEILL, General Manager
M. W. WILSON, Supt. of Branches
715 BRANCHES IN CANADA, NEWFOUNDLAND, WEST INDIES, &c.
BRANCHES IN CANADA AND NEWFOUNDLAND
Alberta - - 47 Ontario - - - 186
British Columbia - 53 Prince Edward Island 11
Manitoba - - 41 Quebec - - - 61
New Brunswick - 26 Saskatchewan - - 107
Nova Scotia ■ - - 74 Newfoundland - - 10
BRANCHES IN WEST INDIES
Cuba— 47 Branches. Havana. Santiago, etc.
Porto Rico— San Juan, Mayaguez. Ponce.
Dominican Republic— Santo Domingo, etc. ((i br:
Guadeloupe— Basseterre and Pointe-a-Pitre.
Martinique— Fort de France and Trinite.
Haiti— Port au Prince and Aux Cayes
Antigua— St. John's.
Bahamas— Nassau.
Barbados— Bridgetown and Speightstown
Dominica— Roseau.
Grenada— St. Georges.
Jamaica^Kingston, Cross Road
Montserrat— Plymouth.
Nevis— Charlestown.
St. Kitts— Basseterre.
St. Lucia — Castries
Tobago— Scarborough .
dSpanishTovvn. Trinidad — Port of Spain, San
Fernando and Sangre Grande.
BRANCHES IN CENTRAL AND SOUTH AMERICA
Argentine— Buenos Aires.
British Honduras — Belize.
British Guiana^Georgetown.'Ne
Brazil— Rio de'Janeiro. Santos and Sao Paulo.
Colombia— Barrang uilla.
sterdam and Rose Hall. Venezuela— Caracas, Ciudad Boli'
Uruguay — Montevideo.
Costa Rica— San Jose,
iracaibo and Puerto Cabello.
SPAIN— BARCELONA, Plaza de Cataluna, 6
GREAT BRITAIN:
LONDON - - - Princes St., E.C
T. R. WHITLEY, Manager. JAS. MACKIE, Joint Manager
FRENCH AUXILIARY:
THE ROYAL BANK OF CANADA (FRANCE), PARIS— 28 Rue du Quatre-Septembre
UNITED STATES:
NEW YORK ... 68 William St.
F. T. WALKER, J. A. BEATSON,
E. B. McINERNEY and G. M. TODD, Agents
PRINCIPAL CORRESPONDENTS :
GREAT BRITAIN— Bank of England.
London County Westminster and Pilrr's Bank, Ltd.
Bank of Scotland.
London Joint City and Midland Bank. Ltd.
UNITED STATES New York-Chase National Bank.
[^ American Exchange National Bank.
Chemical National Bank.
Bank of the Manhattan Co.
Boston— National Shawmut Bank.
First National Bank.
Chicago— Continental & Commercial National Bank.
Philadelphia— Philadelphia National Bank.
Minneapolis— First National Bank.
UNITED STATES San Francisco— First National Bank.
Buffalo- Manufacturers & Traders National Bank.
New Orleans— Canal Commercial Trust & Sav. Bk.
London County Westminster & Parr's Bank. Lt
Banco Calamarte
Credito Italiano.
Banco di Napoli
Hongkong and Shanghai Banking Corporation.
INDIA, CHINA
AND JAPAN
AUSTRALASIA
Bank of New South Wale
^iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiniinuiiiiiiiiiiiiiiiiiiiiiiiiiniiiiiiiiiiiiiiiiiiiiiiiNiiiiiiiiiiiHiiiiiiiiiiiiiiiiuiiiiiiiiiuiiiiininuiniiiiiiiiiiiiiiiiiiii^
46
THE MONETARY TIMES
Volume 66
RECORD OF INTERNATIONAL EXCHANGE QUOTATIONS, 1914-1920
(Compiled for The Monetary Times by the Foreign Department, Canadian Bank of Commerce)
Months and Years
1914
July
August
September .
October
November . .
December . .
1915
January
February . . . .
March
April
May
June
July
August
September .
October
November
December. . .
1916
January
February .. . .
March
April
May
June
July
August . . . . .
September . .
October
November . .
December. . .
1917
January
February .
March
April
May
June
July
August
September .
October ...
November .
December. . .
1918
January . . . .
February . .
March
April
May
June
July
August
September . .
October . .
Novembr*r . .
December. . .
1919
January . . . .
February . . .
March .
April .
May
Jun'e
July
August .
September .
October . .
November
New York
Funds in Canada
High
I's P
i% D
Par
A P
Vs P
1 P
if P
II P
16 '^
H P
it P
U P
A P
14 P
/8 P
sV P
A P
1^
1^
m
2H
2A
2 '
December ,11
2>i
2tV
2|3
^H
2f
3
Sj
4
5X
IX n
1'4 D
% D
Par
A P
Par
A D
.\ D
A P
? P
jV P
A P
/^ P
A P
A P
X
Par
h P
p
p
ih P
A D
6 P
/i P
A D
if D
A D
A P
a
63
m
1#T
1 jj
lit
2
Demand
Sterling
High
492.00
607 50
50e.00
497 50
490.65
489.15
485.05
484.70
481.15
479 80
479.80
478.45
476.75
476.25
471.87
472.37
471.37
473.65
478.00
476.50
476 . 94
476.56
476.31
476.94
475.87
475.87
475.75
475.68
476.68
475.68
475.85
475.80
475.56
476.00
475.62
475 . 55
475.70
475.56
475.50
475 . 38
475.25
475.25
475.33
475.31
475.40
475.52
475 . 50
475.43
475.3.'i
476.06
475.50
475.52
476.00
475.70
475.85
475..80
475 . 70
468.00
468.75
463.25
457.25
435.75
426.25
4-25.25
416.75
.399 75
485.30
5OH.00
495.25
489.40
486.85
485.00
483.95
+79.15
478.55
478 . 90
478.25
475.85
476.00
455.00
454.00
461.62
463.50
470.25
473.63
475.81
475.87
476.31
475.50
475.06
475. «9
475.75
475.69
475.37
475.56
475.45
475.56
475.33
475.12
475.31
475 . 45
475.37
475.37
475.55
475.30
475.19
475.19
475.19
475.12
475.25
475.25
475.37
475.43
475.30
475.18
475.31
475.43
475.43
475.50
475.00
475.70
475. 7< I
475.25
458.50
462.00
458 . 62
430 . 87
412.00
412.75
414.25
400.50
367.25
(France) Francs
High Low
505 516%
No quotations
506 I 510
505 515
510
511X
516^
5I8-4'
525 ys
531;^
531%
543
553
564
576
579
582}4
5S3)4
583>^
586
587 54:
592^2
591 X
5903^
59034-
589
583
583V
584X
583>^
584 X
584 J^
584^
568
570>i
572 X
573
576X
577
571 X
573 >^
572^-
570
571^
571%
569>i
571f^
569 X"
544?^
546X'
54fi^
539
545J^
545H
545,!^
546;^
.S89
606X
628
649
727
782
836
515%
517
519^
528
532X
532X'
543
570
570^"
602
601
598X
599
588
588
590>^
598
607
594>i
592X
591-^
592
585 X
584X
586
584 X
585 >i
585 K
5Si<4
573^
578
679 X
578 >i
580
579;^
576X'
574 "4
573 X
572;^
573
572%
57114
571 X
571^8
56i'>^
549X
548 ,\
547>^
545|i
.546%
547 ^^
P06
610
671
650X
735
826
924
880
980
1178
(Holland) Guilders
High
40X' I 40,-\
No quotations
No quotations
No quotations
40% 40>^
40% 40X
40A
40A
40
39%
39A
40
40%
40t^!
40%
41%
42
43X
44%
42%
42ii
43%
41il
41X
41X
41%
41A
41A
41
40%
40ii
40i?
40A
41H
41 X
41X
41A
42X
42%
45X
45%
44X
43X
45X
46X
47%
50%
51
51%
52>^
50X
47
42%
42%
41%
41%
40%
40A
39 Vi
38tti
37t%
38^
38%
38
38%
40
39%
39X
39A
39%
39A
39%
39%
39%
40%
41%
41%
42%
41ii
42
40%
41A
41%
41%
40X
40]f
40U
40H
40i|
40A
40X
40A
40it
40iS
41%
41X
41%
42
43%
43%
42 X
43%
44%
46
47X
49X
50
50X
46X
41X
41%
42
40%
40ii
39%
40
.39
38%
36%
36X
36%
37%
37X
37%
(Italy) Lire
(Norway) Kroner
High
516% 518>
No quotations
No quotations
No quotations
533 1 540
524 536
533%
542%
563
576%
575
591
609
620
615
622
643
651%
653
667%
652
631
647
635
637X
642
641^"
646
664
673
687
709
762
687
701
703%
719%
723
751
772
795
842
831
857
795
876
801
636
631
637
637
636
636%
636%
636%
705
748
780
785
860
947
968
1077
1214
544
580
595
589
592
616
640
652
652
646
651
660
678
676
671%
662%
621
641%
649%
648%
648
666
674%
691%
720
756
785
768
706
736
726%
749%
779%
795
895
791
858
877
892
901
9lS%
911
881
801
637
637
637
637
637
637
785
758
875
817
879
968
1014
1082
1270
1347
High
26.75 I 26.72
No quotations
No quotations
No quotations
26.00
25.00
25%
25.00
25%
243X
25.00
24%
25.30
24%
25.90
25.05
26.30
25.75
26.55
26.20
26 35
25.60
26.25
25.40
26.25
25.25
26.30
25.65
29.00
26.10
29.00
27.00
28.10
27.35
28.30
27.55
28.95
28.10
30.35
29.00
31.25
29.60
31.00
28.00
29.20
28.05
28.80
28.40
28.75
28.10
28.35
27.65
27.75
27.66
28.15
27.70
28.10
27.90
28.00
27.90
29.30
28.05
29.70
28.30
29.40
29.10
29.50
29.00
30.75
29.25
31.00
30.00
31.30
30.30
35.50
31.13
37.50
33.00
33.50
31.60
32.75
31.00
32.00
30.25
31.50
29.87
32.12
31.25
31.55
30.75
31.60
31.20
31.40
31.20
31.45
30.90
31.00
31.40
29.80
27.20
27.40
26.80
28.00
27.40
28.00
27.00
27.35
27.00
27.20
25%
26.05
25.60
25.60
24.70
25.60
24.65
24.75
23.40
.23.70
22 90
23.50
22.65
23.25
22.55
23.55
21.40
21.55
17.65
January 7, 1921
THE MONETARY TIMES
47
THE CANADIAN BANK OF COMMERCE
Statement of the result of the business of the Bank for the
year ending 30th November,, 1920
Balance at credit of Profit and Loss Account brought forward from last year $ 1,427,735 40
Net Profits for the year ending 30th November, after providing for all bad and doubtful debts 3,306,243 97
$ 4,733,979 37
This has been appropriated as follows:
Dividends Nos. 132, 133, 134 and 136, at twelve per cent, per annum $ 1,800,000 00
Bonus of one per cent., payable 1st December 160,000 00
Dominion and Provincial Government taxes and tax on bank-note circulation 360,000 00
Written off Bank Premises 600,000 00
Transferred to Pension Fund 160,000 00
Balance carried forward 1,783, 9f9 37
$ 4,733.979 37
GENERAL STATEMENT, 30th November, 1920
To the Public- LIABIUITIES
Notes of the Bank in circulation !
Deposits not bearing interest $108,813,028 52
Deposits bearing interest, including interest accrued to date 286,066,493 06
Balances due to other Banks in Canada
Balances due to Banks and Banking Correspondents
Bills Payable
Acceptances under Letters of Credit
To the Shareholders —
Dividends Unpaid
Dividend No. 135 and bonus, payable 1st December.
Capital Paid up
Rest Account
Balance of Profits as per Profit and Loss Account . .
393,878,521 57
792,301 63
10,640,517 £3
1,139,863 90
11,204,565 81
$448,372,665 02
$15,000,000 00
15,000,000 00
1,783,979 37
ASSETS
Gold and Silver Coin Current on hand $15,992,107 21
Gold deposited in Central Gold Reserves 6,500,000 00
31,783,979 37
$480,760,624 51
Dominion Notes on hand $35,388,710 26
Dominion Notes deposited in Central Gold Reserves 10,000.000 00
$ 22,492,107 21
45,388,710 25
Notes of other Banks $ 2,482,865 00
Cheques on other Banks 25,846,697 22
Balances due by other Banks in Canada ."■ 100 00
Balances due by Banks and Banking Correspondents elsewhere than in Canada 11,290,555 29
Dominion and Provincial Government Securities, not exceeding market value
British, Foreign and Colonial Public Securities and Canadian Municipal Securities, not exceeding market value
Railway and other Bonds. Debentures and Stocks, not exceeding market value
Call and Short Loans (not exceeding 30 days) in Canada on Bonds, Debentures and Stocks
Call and Short Loans (not exceeding 30 days) elsewhere than in Canada
Deposit with the Minister of Finance for the purposes of the Circulation Fund
$ 67,880,817 46
Other Current Loans and Discounts in Canada He;
Other Current Loans and Discounts elsewhere than
Liabilities of Customers under Letters of Credit, a
Overdue Debts (estimated loss provided for)
Real Estate other than Bank Premises
Mortgages on Real Estate sold by the Bank
Bank Premises at cost, less amounts written oflE
Other Assets not included in the foregoing
rebate of interest)
1 Canada (less rebate of interest)
per contra
39,620,217 51
13,101,656 80
20,737,620 72
6,059,204 45
21.434,844 02
34.274.934 06
908,245 56
$204,017,440 58
231,114,772 74
26,863.226 72
11.204,565 81
147,916 91
514.901 60
190,501 63
6,617.095 06
90,213 66
$480,760,624 51
B. E. WALKER, President.
Report of
JOHN AIRD. General Manager.
Shareholders of The Canadian Bank of Commerce.
of the Bank Act. 1913. we report as follows:—
and vouchers at Head Office and with the certified
that we have required, and are of the opinion
powers * " ~
Auditors to
In accordance with the provisions of sub-sections 19 and 20 of section 56
We have audited the above Balance Sheet and compared it with the books
returns from the branches. We have obtained all the information and explanatic
that the transactions of the Bank which have come under our notice have been
We have checked the cash, and verified the securities representing the investments of the Bank, at its chief office and principal
branches at a date other than that of the verification at the chief ofiice on the 30th November, 1920, and found that they were
in agreement with the entries in the books of the Bank relating thereto.
In our opinion the Balance Sheet is properly drawn up so as to exhibit a true and correct view of the state of the affairs of
the Bank according to the best of our information and the explanations given to us, and as shown by the books of the Bank.
T. HARRY WEBB, C.A., \
of George A. Touchc & Co. I A„j:,r.r=
JAMES MARWICK, C.A., f -*"°™'^=-
of Marwick, Mitchell & Co. '
48
THE MONETARY TIMES
Volume 66
RECORD OF INTERNATIONAL EXCHANGE QVOTATIONS—Conimued
Months and Year
1920
January
Kebruarv
Man-h
April..
May.
June
July
August
September
October
November
Dec. (to Dec. 2i).
New York
Funds in Canada
High
13
ITA
ibH
i\'4
12H
ISA
I4H
1*A
n%
11^8
14tV
12A
9
9>^
12A
12t\
9X V
8X P
W% P
13^8 P
Demand
Sterling
High
379.00
348.00
395.25
402.25
390.75
399.25
395.75
372.00
356.50
350.75
348.75
353 . 50
349.25
324.00
341.00
376.00
380.75
388 . 50
374.25
354.87
344.75
340.50
334.00
343.00
(France) Francs I (Holland) Guilders 1
High
10.77
13.20
13.10
14.50
12.20
11.62
11.60
13.07
14.25
14.87
15.80
16.34
13.35
14.85
14 98
17.00
16.67
13.22
13.25
14.50
15.47
15.80
17.30
17.23
High
39K
38X
37X
37^
36^
Z&H
Zby^
34X
32H
3liV
30^
ZIH
37^8
36^
36 >i
36 )i
36 X
35X
^i%
31>^
30 f^
30^
29;^
30>g
(Italy) Lire
High
13.21
15.67
17.22
20.45
16.37
15.82
16.17
18.60
21.32
23.94
25.70
26.90
15.52
19.32
20.52
26.12
22.22
18.37
18.77
21.92
24.05
26.74
29.50
28.78
(Norway) Kroner
High
20.30
17 60
19.40
22 00
19.25
18.20
17.00
15.70
14.53
14.40
13.60
15.00
17.55
16.80
17.00
19.15
18.00
16.50
15.70
14.10
13.25
13.40
13.05
13.50
NET PROFITS AND DIVIDENDS OF CANADA'S BANKS
(l)Bank of Montreal 1,797,993
§Quebec Bank 1 278,926
Bank of Nova Scotia ! 662,302
(2) Bank of British North America I 554,942
Bank of Toronto I 589,656
The Molsons Bank i 602,694
La Banque Nalionale 257,917
(3) Merchants Bank ol Canada , 1,057,140
Banque Provinciate du Canada 149,062
Union Bank of Canada 451,620
Canadian Bank of Commerce 1,838,065
(4)Royal Bank o( Canada 951,336
Uominion Bank 659,300
(5)Bank of Hamilton 422,090
••"•-" ■ • 373,208
417,697
532,353
702,508
95,832
! 258,144
I 96,825
Standard Bank of Canada
Banque d'Hochelaga
(6) Bank of Ottawa
Imperial Bank of Canada.
Home Bank of Canada. .
(7)Northern Crown Bank...
Sterling Bank
(8)\Veyburn Security Bank..
(l)Bank of Montreal
§Quebec Bank
Bank of Nova Scotia
(2)Bank of British North America.
Bank of Toronto
The Molsons Bank
La Banque Nationale
(3)Merchants Bank of Canada . . . .
Banque Provinciale du Canada.
Union Bank of Canada
Canadian Bank of Commerce . .
4) Royal Bank of Canada ...
Dominion Bank
(5)Bank of Hamilton
Standard Bank of Canada
Banque d'Hochelaga
(6)Bank of Ottawa
Imperial Bank of Canada. .
Home Bank of Canada. . .
(7)Northern Crown Bank
Sterling Bank
(SlWeyburn Security Bank
2,108,631
233,420
1,220,057
328,595
663,074
556.193
333,207
995,431
196,355
659,688
2,352,035
1,905,576
805,123
424,274
563.401
530,237
531,268
1,031,359
133,406
100,789
145,290
53.844
%
10
7
12
7
10
10
8&9
5
7
9
11&12
12
10
12
8
lOJ
11
6
5
5
Di\
%
10 + 2
7
14
11
11
8
10
7
8 + 1
10 + 2
12
12
12
13
9
12
12
5
Nil
6
JIO
$
2,276,519
276,392
815,519
632,117
677,964
712,539
202,613
1,179,581
184,398
662,437
2,305,409
1,152,249
704,045
443,506
381,601
415,000
595,228
841,692
121,941
285,694
107,876
26,682
2,200,471
1,252,038
546,346
730,954
582,356
417,662
950,713
203,983
651,183
2,439,415
2,111,307
893,502
442,525
580,230
546,011
591,205
1,003,960
217,059
128,761
161,270
82,149
%
10
13&14
8
11
11
7
9 & 10
5
8
10
12
12
11
13
9
11
11&12
6
5&6
5
2i
2,518,409
294,804
970,544
678,506
835,787
684,779
293,564
1,338,844
185,165
706,832
2,811,806
1,527,324
901,529
495,860
462,079
481,616
640,220
1,004,340
140,030
291,094
113,400
63,135
%
10+2
7
14
8
11 + 1
11
7
10
6
8
10 + 1
12
12 + 2
11
13
9
111
12
6&7
6
6
5
S
2,648,403
309,228
1,210,774
689,745
* 1,050,693
694,356
302,304
(A) 533,653
19c,126
750,095
2,992,951
2,142,100
950,402
498,273
555,095
534,700
706,740
1,125,971
167,1-25
281,167
114,200
54,917
Divi-
dend
%
10 + 2
2,477,969
14
7
11
11
8
10
7
8+1
10 + 2
12
12
12
13
9
12
12
5
1,295,
"668,
802,
615,
435,
1,236,
207,
763
2,63
2,327
1,005,
598
649,
565
616
1,185,
228
t208,
186
74,
315
003
920
514
283
680
483
,463
,555
979
062
,522
546
,433
238
,066
,963
608
120
274
Divi-
dend
%
10+2
14
8
11
11
9
10
7
8 + 1
10+2
12
12
12
13
9
12
12
2,562,720
1,411,925
844,402
712,485
533,450
1,383,569
434,594
824,174
2,850,318
2,809,846
1,086,498
571,226
697,443
595,187
645,347
1,247,516
238,753
%
10 + 2
7
14
8
11 + 1
11
8
10
6
8
10 + 2
12
12 + 2
12
13
9
12
12
7
6
%
10+2
14
11
11
9
10
7
10
10 + 2
12
12
12
13
9
12
12
5
213,632
. 74,343
2,496,452
296,659
1,196,117
536,577
829,538
608,196
, 319,903
1,218,694
1^4,214
712,440
2,668,233
1,886,142
925,364
485,265
621,463
566,614
620,691
1,236,984
163,929
201,289
115,111
48,. 354
3,314,227
1,926,478
1,011,359
818,802
567,372
1,686,156
b) 333,882
932,256
3,074,892
3,423,264
1,169,703
847,104
776,310
611,105
1,379,318
268,895
251,346
62,220
16
12
12
10
12+1
8
, 10
12
12+2
12+1
12
13
10
12+1
6
(1) Prior to 1904 the Bank of Montreal's year ended in April. The profits during
1911 include ?708.800 expended in premises and those of 1912. $.511,000; in
penditures were deducted. 2% bonus since June,
previous years
1912.
(2) Figures for 1912
(3) 1913 figures
these
ire from Jan. l.st to Nov. 30th inclusive.
.„,„ ..i.„.^o ».- for 5 months ending 30th April. 1915 figures are for year
April. 1915 Net profits for year ending April. 1916. $970,713. Dividend, 10%.
(41 1912 figures are for 11 months ; financial year changed.
{f,") The 1917 figures are for the 15 months ended 28th February. 1918.
(6) The Bank of Ottawa was absorbed by the Bank of Nova Scotia in May, 1919.
17) 1912. profits are for 11 months.
(8) Weyburn Security Bank commenced business only in 1911.
X 5% cash dividend and 5% stock dividend.
* Including 8200.000 debts recovered.
§ The Quebec Bank was purchased by the Royal Bank of Canada on Dec.Slst. 1916.
and did not issue a statement showing the result of its business for that year.
Dividends amounting to 8191.450, being at the rate of 7% per annum, were
paid during the year.
1a) Result of business for 5 months only.
(ii) Figures for the previous period were for 18 months. There was a proportion-
ate increase of 844.512 on a twelve months' basis.
♦* Absorbed by the Bank of Montreal, March, 1918.
t Purchased by the Koyal Bank. June 30th, 1918. who paid 10.883 fully paid
shares of the capital stock of the Royal Bank, and $576,970 in cash.
January T, 1921 THE MONETARY TIMES
lllllllilHIIIillllllillllllllililllilllMllllllllillllllillllllllllllllllllllMlllililllllllllllllllllilllllllllH^
ESTABLISHED
giliiiiiiiniiiiiiiiiililiiililiiiiiiiillllllllllliuitlllliiiiiliiiilliiii^
\
^lllilllllllllilllllll lllllillllillllllllllllllllllllllllllltllllIrT:-
Coinnionwealtb Bank of Hustralia
acts as bankers to the Commonwealth Government and State Governments of South
Australia, Western Australia and Tasmania.
All classes of GENERAL and SAVINGS BANK business are transacted in all the prin-
cipal cities and towns of Australia, Rabaul and London.
Banking and exchange business of every description transacted within the Common-
wealth, United Kingdom, Canada, U.S.A. and abroad.
JAS. KELL, DENISON MILLER,
Deputy Governor 1920 Governor
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This Advertisement |
will be read frequently throughout the year 1921 by thousands of i
Canada's wealthiest and best-known financiers, manufacturers and 1
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only once but many times during the year by individuals whose 1
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50
THE MONETARY TIMES
Volume 66
Canadian Gold Stocks Decreased During Past Year
Government Held $100,000,000 On October 31, While Banks Held $80,000,000 in Gold
and Subsidiary Coin — Record of Holdings During Past Months — World's Declared
Holdings Reached Maximum at End of 1918 — Movement Towards East in Recent Years
PRACTICALLY all the gold in Canada is held by the Do-
minion government and by the chartered banks. The
totals shown in the monthly statements of the banks to the
government, and in the latter's own monthly statements of
circulation and gold reserve, have decreased during the past
year. These totals are shown below. In the case of the
banks, subsidiary coin is included.
Gold Reserves of Dominion Government
Gold held for
redemption of Reserve for
1919 — Dominion notes. savings department. Total.
October $122,633,564 $4,667,887 $127,301,441
November 123,719,093 4,493,216 128,212,310
December 114,821,963 4,389,872 119,211.834
1920—
January 105,165,301 4.229,339 109.394.640
February 105,609,980 4.169,071 109,969,061
March 100.286,280 4,113,174 104,399,454
.:ipril 101,636,652 4.033,044 106,669,606
May 102,496,683 4,107,517 106,603,200
June 99,619,182 4,080,992 103,700,174
July 95,510,383 4,079,589 99,589.972
August 95,183,753 4,044.990 99,229,743
September 95,205,901 4,022,842 99,228,743
October 95.222.381 4.006.798 99.229,179
At the end of January, 1916, gold held for the redemp-
tion of Dominion notes amounted to $115,147,985. In January
of 1917, the figure was $114,105,144. while in October of
that same year it had arisen to $114,616,227. In connection
with the above figures it might be also interesting to note
that the decrease in gold held for the redemption of notes
has not been in accorda^nce with the circulation of such notes.
For instance, in January of 1920, circulation totalled $303,-
678,278, against which was held $105,165,301 in gold. In
September of this year the circulation was $303,065,376,
while only $95,205,901 was held against this in gold. The
reduction in gold reserve against savings deposits was justi-
fied, as deposits in the Post Office Savings Banks and the Do-
mininon Government . Savings Banks have decreased.
Banks' Holdings
Turning to the banks' holdings of gold it will be noticed
that during the past two years there has not been very much
change. Holdings in Canada have tended to become lower,
while holdings of the banks abroad have increased slightly.
The monthly average, however, has followed a fairly even
course.
Gold and sub. Gold and sub. Monthly
1919 — coin in Canada, coin elsewhere. Total. average.
January $61,564,369 $18,999,305 $80,563,677 $86,168,445
February 61.407,637 18,771,077 80,178.618 85,725,951
March 61,568,476 18,685,091 80,253.572 86,098.447
April . . .■ 61.521,905 18,935,264 80,457,174 84,953,140
May 61,328,957 18,675,213 80,004,173 84.809.908
June 60,543.234 18,736,201 79.279,438 85,656,671
July 61.045,702 19.157.828 80.203,535 86,236.599
August 61,025.508 19.799.188 80.824,700 86,079,703
September 61.656,194 19,888,844 81.560,043 87,170,499
October 61,496,667 19,6.56,819 81,063,489 86.492,301
November 63,168.170 20,684,480 83.572.653 86.617,911
December 62.553,188 17,634,912 80.088,103 84,213,438
1920—
January 63,248,178 17,647,320 80,895,602 86,641,270
February 63,302,649 17,677,669 80.980.212 87.668.936
March 63,667,531 16,323.290 79.990,826 87.396,939
April 66,864.526 16,483.966 83,348,497 88.865.086
May 63,830.589 16.368,010 80.198,600 86,487,324
June 63.682,026 17.282,255 80.964,285 86,460,864
July 62,580.287 18,480,221 81.060.510 87.471.926
August 61,499,066 18.455,770 79,954.831 86.332,046
September 61,764.041 19.273.632 81,037,676 86,944,667
October 61.680,300 18,143,172 79.823,476 86.211.873
The World's Stocks
The past two years have witnessed important movements
in international gold supply, while the grand total has de-
creased since the end of 1918. Japan and India show in-
creases, indicating an extensive movement to the Orient. The
world position in this respect is fully discussed by a writer
in the London Times of August 14, 1920, whose figures show
the gold holdings of the world's state banks and treasuries
at the end of 1913, 1914, 1915, 1918 and 1919 and also at the
end of June last, and therefore gives a measure of the move-
ment of gold money during the war. As it is desired to
arrive at a grand total, it is necessary to include, at any rate,
one doubtful item — that of the Imperial Bank of Russia, for
which no figure later than that of October, 1917 (£129,500,-
000), is available, and the totals shown since that date are
approximations much open to question. The last two figures
of £65,000,000 are based on the statement that the gold re-
serve transferred to Omsk amounted on August 1, 1919, ta
651,532,118 roubles. If the figures set down for Russia are
too high, they affect the calculations in this statement accord-
ingly.
All Countries Not Included
The table is not exhaustive, since Greece, Rumania,
Portugal, Turkey, Finland, Bulgaria, Egypt, Brazil, Uruguay,
Peru, the Straits Settlements, and the banks of issue of
Scotland, Ireland, Victoria, and New Zealand are not in-
cluded; but if all these were added, they would probably ac-
count for £70,000,000 at the end of 1913, rising to £85,000,000
at the end of 1915, and thereafter probably falling somewhat
if the actual gold holdings of the state banks of Greece and
Rumania (for which figures are not available to the writer)
have not increased. The addition of these further banks,
however, would not materially affect the total of the table: —
End of
France (1)
Enprland (2) . .
Spain
Russia (3)
Reichsbank (7)
Netherlands
Italy
(In n
Dec,
1913.
140.3
35.0
19.2
161.6
Sweden
Nat. of Denmark . . . .
Nat of Belgium
Austro-Hungary Bank .
Norway
Total, Europe
Dec,
1914.'
166.3
88.0
22.9
155.4
103.9
18.1
44.7
9.5
6.0
of pounds)
Dec.
1915.
200.G
80.0
34.7
161.2
122.3
35.8
43.1
lO.O
6.9
6.2
Dec,
1918.
219.1
108.5
89.1
67.5
32.7
16.6
15.9
10.8
10.7
(11.9)
6.7
Dec,
1919.
223.1
119.8
97.8
(65.0)
64.6
53.1
32.2
20.7
15.6
12.6
10.7
June.
1920.
223.5
146.4
98.1
(65.0)
54.6
53.0
(32.2)
21.3
14.6
12.7
10.7
11.0
8.1
U.S. Treasury
Argentina (4)
772.(
526.(
Canada. Treasury
Canada Chart. Banks (6)
Australia Com. Bank..
43.9
23.7
33.3
19.5
24.8
12.9
15.0
(21.0)
(16.6)
(23.9>
Grand Total
Notes to above.
(1) Including gold
abroad
(2) Including gold
against currency
notes
(3) Excl. gold abroad
(4) Ditto
(5) Including gold
abroad
(6) Including gold
outside Can.
17) £10.260,000 in Span-
dau Tower at De-
cember 31, 1913.
36.0
944.8
37.0
1034.0
52.7
1227.7
18.5
21.4
28.6
27.0
13.5
28.6
16.6
January 7, 1921
THE MONETARY TIMES
Every Modern
Banking Facility
BOARD OF DIRECTORS
Sir William Price. Quebec. Honorary Presi
John Gait, Winnipeg. President
G. H. Thomson. Quebec. Vice-President
Stephen Haas. Toronto. Vice-President
W. R. Allan. Winnipeg. Vice-President
Major Hume Blake, Toronto
G. H. Balfour. Winnipeg
M. Bull. Winnipeg
Sir John W. Carson. C.B.. Montreal
B. B. Cronyn. Toronto
E. L. Drewry, Winnipeg
S. E. Elkin. M.P.. St. John. N.B.
A, Hitchcock, Moose Jaw. Sask.
J. S. Hough. K.C.. Winnipeg
F. E. Kenaston, Minneapolis. Minn.
R. O. McCulloch. Gait. Ont.
W. H. Malkin. Vancouver, B.C.
Wm. Shaw. Quebec
G. M. Black. Winnipeg
D. N. Finnic. Winnipeg
OFFICERS
H. B, SHAW. Winnipeg. Gene
J. W. HAMILTON. Winnipeg,
Asst. Gel
F. W. S. CRISPO, Winnipeg,
Asst. Gel
al Manager
eral Manager
eral Manager
era! Manager
eral Manager
FROM Halifax and Charlottetown, settled and historic,
on the Atlantic, to Prince Rupert, and Vancouver, new
and growing, on the Pacific, are more than 400 branches
of the Union Bank of Canada. In frontier towns, in
peaceful farming districts and in bustling cities, they
stand at strategic points in the pathways of Canadian
trade and commerce, linking East with West, North with
South.
Our nation-wide Banking Service is always at the
disposal of producers, business men and individuals.
Abroad, we have our own New York Agency (49 Wall
St.) and two branches in London, Eng., (6 Princes' St.
E.C., and 26 Haymarket, S.W.) In addition, branches of
the Park-Union Foreign Banking Corporation, which is
jointly owned and controlled by the National Park Bank
of N.Y., and the Union Bank of Canada, offer direct
banking connections in the Orient ; at San Francisco and
Seattle, in the U.S. ; and in Paris, France.
UNION BANK OF CANADA
Capital and Reserve $14,149,296.47
Assets (Nov. 30, 1920) $169,205,445.39
THE MONETARY TIMES
During the years 1916 and 1917, the chief movements
were as follows: — 1916. — Increases. — France, 203.0; England,
83.5; Reichsbank, 126.0; Netherlands, 49.0; U.S. Treasury,
453.0; Argentina, 51.5; Japan, 41.0. Decreases. — Russia,
147.3; Italy, 36.0; Austria-Hungary, 12.1. 1917.— In-
creases. — France, 214.2; England, 87.7; Spain, 78.7; Nether-
lands, 58.1; Sweden, 13.6; U.S. Treasury, 492.0; Japan, 65.6.
Decreases.— Russia, 129.5; Italy, 33.4; Reichsbank, 120.3;
Austria-Hungary, 11.9. The totals for the two years re-
spectively were: — Europe, 757.0 and 768.2; America, 504.5
and 543.8; Asia, 56.9 and 84.1; and Colonies, 54.7 and 58.0
The grand totals were 1,373.1 and 1,474.1.
It will be seen that the annual increase in the gold hold-
ings of these state banks and treasuries was greatest in 1915,
and that in 1919 there was a material loss, particularly in
the case of Germany, the United States, and Russia, though
Japan showed a marked increase.
Stock of Gold Money
During the period covered the aggregate stock of gold
money has been materially added to, as shown by the follow-
ing table, which shows how the stock has been built up to
the extent of £356,000,000 since the end of 1913:—
(In millions of pounds. Gold at 85s. per fine oz.)
Industrial India's
consump- absorp-
tion tion. Balance Aggregate
World's (Europe (year to Egypt's available stock of
output and March 31 absorp- as gold money
of gold. America), following). tion. money. (Dec. 31).
1912 96.9 25.6 25.2 4.2 40.9 1,546
1913 94.7 27.3 18.0 —1.4 50.8 1,596
1914 90.4 (21) 7.6 — B.O 66.8 1,663
1915 96.4 (17) 1.7 —0.8 78.5 1,742
1916 93.6 (18) 11.1 — 64.4 1,806
1917 86.3 (16) 19.0 — 51.3 1.857
1918 78.2 (16) —1.6 — 63.8 1,921
1919 72.0 (22) 19.4 — 30.6 1.952
The totals in the last column give the stock of gold
money as arrived at by the writer's method, which is suffi-
ciently indicated in the table. Other estimates differ con-
siderably, the estimate of the United States Treasury, quoted
in The Economist Commercial History Supplement of Febru-
ary 16, 1918, being £2,095,000,000 at the end of 1913.
Falling off in Gold Production
The foregoing table shows the striking falling off in the
gold production since 1915, and the still greater drop in the
amount of that production which is available as money. For
1919 the latter was about £31,000,000, as compared with about
£45,000,000 per annum in the few years before the war — ^the
war years for special reasons added abnormally to the stock
of money. As the gold output for 1920, and possibly for suc-
ceeding years, will show a further decline, anything like a
normal demand by industry and India would leave as avail-
able for money each year an amount which under pre-war
conditions would have been inadequate for the growing trade
and commerce of the world. Indeed, the total stock of gold
money, which rose strongly from 127d. per head of the world's
population in 1893 to 259d. in 1918 and 261d. in 1919, seems,
for the near future at least, to have reached a point at which
it will do little more than merely keep pace with the grow-
ing population. It should be pointed out that the last table
takes no account of immeasurable items such as the recent
absorption of gold by China and the illicit import into India,
both of which (affecting 1919 in particular) should, if known,
be deducted from the aggregate figures given, which exclude
Asia.
War Movements of Gold
Having thus arrived at figures both for the aggregate
stock of gold money and for the portion of that amount which
is to be found in state banks and treasuries, it is possible,
by comparing them, to get some idea of the migration of gold
money during the war — a picture which, as regards this
movement, will be approximately coi-rect, even if the aggre-
gate stock of gold money is materially different from that
set down: —
(In millions of pounds)
Private banks,
hoarded, and in
State banks and circulation (differ- Stock of gold
treasuries. ence figures). money.
Year's in- Year's in-
crease or crease or Year's
Dec. 31. Total, decrease. Total. , decrease. Total. increase.
1913 945 — 651 — 1,596 —
1914 1,034 89 629 —22 1,663 67
1915 1,228 194 514 —115 1,742 79
1916 1.373 145 433 —81 1,806 64
1917 1,474 101 383 —60 1,857 51
1918 1,500 26 421 38 1.921 64
1919 1,438 —62 514 93 1,952 31.
493 —137 356
Here one sees gold flowing from the pockets of the
public into the state banks and treasuries, the stream reach-
ing its height in 1915 and diminishing yearly since, as one
would expect.
Increased State Holdings
The state banks and treasuries have not only absorbed
the whole of the new gold production available, but have
taken £230,000,000 in addition in the five years to 1918, dur-
ing which period they increased their stock by 59 per cent.
If the £421,000,000 shown at the end of 1918 as being in
private banks, hoarded, and in circulation is at all near the
mark, it has, of course; become largely immobilized, and is
now mostly held by banks or has been hoarded.
In view of the figures in connection with net imports
into this country, referred to later, and the recent unknovsm
absorption of China and India, already mentioned, the 1919
figures in this table are subject to much correction, and
there was in reality no such drop as £62,000,000 in the hQld-
ings of state banks and treasuries, though the totals at the
end of last June given in the first table fairly represent the
real position.
On a percentage basis, if we leave out Australia, the
most gold has flowed into Japan, which profited much from
the war; but absolutely the United States has taken most.
State banks and treasuries increased their stock to the end
of 1918 by £555,000,000, of which no less than £259,000,000
went to the United States, whose record is as follows:—
(In millions of pounds)
In banks Propor-
and in tion of Net
In circula- Total world's Year's imports
Dec. 31 — treasury, tion. stock. stock. increase, or exports.
1913 266 126 392 24.6% — —
1914 243 128 371 22.3% —21 — S4
1915 347 126 473 27.1% 102 + 87
1916 453 137 590 32.7% 117 -fl09
1917 492 139 631 34.0% 41 + 87
1918 525 126 651 33.9% 20 -f 4
1919 467 107 574 29.5% —77 — 60
182 -f-143
June 30—
1920 445 108 653 28.2% —
Eastern Absorption of Gold
Since the end of 1918 that country has lost about £100,-
000,000. Where has it gone to? Mainly to Asia. £25,-
000,000 has gone to Japan, and the balance, or most of it, to
China and India. At the Royal Statistical Society's meet-
ing on June 15 Sir Charles Addis said that £60,000,000 had
been imported by China recently, and doubtless part of that
has in turn gone via Tibet and the Burmese border into India,
which has also smuggled considerable amounts from other
places, including South Africa, where several millions have
vanished from circulation. The illicit imports into India,
where gold has sold at large premiums in the bazaars, are
reckoned by the Times of India (June, 1920) to have reached
£4,000,000 a month.
Most of the gold shipped home by South Africa is reach-
ing the east. The gold re-exported to South Africa has gone
to make up the wastage caused by illicit export to India, the
amount sent to the Straits Settlements must have largely
gone in the same direction; and it is probably not far wrong
to say that in this way £20,000,000 of gold extracted from
South African mines in the last nine months has found or
will find its way to India.
January 7, 1921
THE MONETARY TIMES
63
THE DOMINION BANK
ESTABLISHED 1871
Capital Paid Up - - -
Reserve Fund and Undivided Profits
$6,000,000
$7,500,000
Sir Edmund B. Osier, President
A. W. Austin
Sir Augustus M. Nanton'
Vice-Presidents
London, England
Branch
73 Cornhill, E.C. 3
S. L. Jones,
Manager
«y "- ft 111
mm 9
n 331313 ii
31 131111 if
^
New York Agency,
51 Broadway
C. S. Howard,
Agent
HEAD OFFICE OF THE DOMINION BANK, TORONTO
CLARENCE A. BOGERT, General Manager
THE MONETARY TIMES
Volume 66
In the year to March 31, 1920, India's declared net im-
ports of gold reached £17,400,000, practically all in the last
five months of the time, the amount increasing rapidly until
March showed twice the figure of November. The net ex-
ports from the United Kingdom to India for the six months
to June 30 last were £18,211,000. Declared gold holdings (as
given in the first table) are sometimes deceptive. During
the five months July to November, 1919, there were net im-
ports into the United Kingdom amounting to £54,854,000,
and the Bank of England's declared gold holding showed an
increase of only £3,223,000 during that period. £42,886,000
of the amount came from Holland and Belgium, and was
doubtless largely German gold intended to pay for food-
stuffs. During the first six months of this year we have ex-
ported (net) £19,052,000 of gold, and in the same time the
Bank of England's declared gold holding was advanced £26,-
600,000! Thus the declared position seems to have been re-
dressed.
Principal Gold-Holding Countries
It is interesting to note that the pre-war and present
positions of the principal gold-holding countries of the world
are: —
(In millions of pounds)
Pre-war. Now.
In banks
and in "Lost,"
State circu- State immobilized
bank. lation. Total. bank, or hoarded.
United States. Dec. 31, 1914. 243 128 371 445 74*
France. Dec. 31, 1914 (U.S.
Mint) 166 119 285 144 141
Russia. Dec. 31, 1914 (U.S.
Mint) 155 49 204 (?)65 139
Germany, Dec. 31, 191S
(Frankfurter Zeitung).. 69 112 131 55 126
United Kingdom, June 30,
1914 (Currency Com-
mittee) 38 123 161 146 15
Totals G71 531 1,202 855 347
•Gained.
The record of the United Kingdom, so far as it can be
traced, is: —
June 30, 1914. June 30. 1915. June 30, 1919. June 80, 1920.
£117,000.000 £146.000,000
Bank of England. £38,000.000 £81.000,000 £117.000.000 £146.000.000
Banks 45.000,000 (?) 40.000.000 I , . 50 000 000
Public 78.000.000 75.000,000 I '■' ''"■'"'"■'"'" < .) O"."""."""
£161,000,000 £196,000,000 £167.000,000 £196,000,000
The Currency Committee recommended that the stock of
gold in the Central Institution should be increased to £150,-
000,000, and this has now been attained.
BANK PREMISES AT COST
In the year 1919 there were more branches of Canadian
banks opened than in any previous period in the banking
history of the Dominion. (Jreat expansion in this connec-
tion also took place during 1920, although not on quite as
large a scale. The figures given below reflect this to some
extent, showing the value of bank premises, month by month
since January, 1917. The amounts given, however, do not
represent the present-day value of the banks' premises. The
government requires that this item in the monthly statement
be valued at not more than cost, less depreciation, if any,
and that no provision be made for appreciation. It is evi-
dent, therefore, in view of the rising cost of real estate dur-
ing the past two years, that the figures which follow under-
value the premises to a certain degree: —
1917. 1918. 1919. 1920.
January $49,317,636 $51,716,972 $52,801,507 $56,500,332
February 49.620.189 51,897,132 53.005.275 57.207,547
March 49.967,852 52,388,793 53,317,635 57,946,975
April 49,980,909 62.313,874 54,443,467 55,317,655
May 50,134,753 52,501,581 53,898,884 56.459.647
June 50,450,150 62.780,885 54,315.064 57.192,011
July 50,577,670 .52.954.694 64.667.642 57.896.005
August 50.725.312 53,333.467 56.014,766 58,554,076
September 51,188.669 53.268,468 55,464.363 59.297,890
October 61,107.191 53,009,741 55,602,824 60,126,795
November 50,850,974 .52.547.327 55.518,536
December 51,484,686 62,550,835 55,944,018
MONTREAL AND QUEBEC SAVINGS INSTITUTIONS
That the Montreal City and District Savings Bank and
the Caisse d'Economie Notre Dame, of Quebec, are two im-
portant banking institutions in the Dominion, is evident from
the figures which are given below. Their business is chiefly
with the French-Canadians of their respective communities
and savings deposits constitute the greater part of their lia-
bilities to the public. The Dominion government keeps funds
on deposit with them, but during the past year, as in the case
of the chartered banks, these balances have been greatly
reduced.
The chief investment of these institutions, as will be
noticed, is in Canadian municipal securities, although their
holdings of other bonds and stock are considerably heavy.
Their loans are made largely on bank stocks and other se-
curities, although the former are not very significant.
The trend of notice deposits reflects the prosperity of the
communities in which they operate. The quick recovery from
the effects of the Victory loan in the fall of 1919 is especially
notable, particularly in the case of the Montreal bank.
Montreal City and District Savings Bank
Dominion
government
Loans
Canadian
demand
Notice
on
municipal
1919.
deposits.
deposits.
securities.
securities.
Cash.
October
... $ 93,599
$40,253,569
$7,268,848
$16,481,022
$7,017,658
November
. . . 2,916,405
38,880,396
8,031,883
16,381.179
7,094,666
December
1920.
January
. . . 1,354,920
40,213,589
8.155.710
16.400,944
6.782.375
972,377
40,982,767
8,467.671
16.563,863
6,636,242
February
642.376
41,947,219
8.528,526
15,728,125
6.813,298
March . . . .
624,836
42,693,315
8,856.906
15,800.058
7,052,432
April
614,835
42,798,052
9,178,936
15,618.772
7.366.586
May
619,835
42,708,148
9,216,677
16.600,076
7.296.117
June
395,043
42.928.529
9.441,090
16,241,758
7,513,983
July
336,043
43.043.074
9,396,848
16,191,611
6.831.303
August
286,043
43,654,974
9,307.661
16,167,414
7.103.422
September
260,043
43,889,372
9.610.628
16,136,263
6.785.748
October . . .
200,043
43,950.117
9.576,381
16,074,660
7,037,959
Caisse d'Economie Notre Dame de Quebec
Dominion
government
Ix>ans
Canadian
demand
Notice
on
municipal
deposits.
deposits.
securities.
securities
Cash.
. $
$10,688,489
$3,070,713
$4,087,966
$1,869,093
. $ 515,985
10,119,820
2,984,875
4,087,534
1,711.899
422,880
10,196,410
3,003,488
4.083.687
1.707,758
357,605
10,209,265
3,098,423
4,082.464
1.620,782
202,041
10.341,502
3,081,775
4,121,677
1,600,022
188,628
10,424.737
3,200,655
4,121,677
1,554,108
188,628
10.513.667
3,247,493
4,114,676
1,663,534
168,628
10.645,071
3,219,714
4,113,968
1,632,221
95,628
10,468,067
3,242,860
4,107.008
1,398,087
68,628
10,292,696
3,182,692
4,104,616
1,287,284
43,628
10.729.619
3,183,629
4,078,615
1,302,238
33,628
10,324.364
3,203,326
4.074,780
1,326,916
7,628
10,507.703
3,213,922
4,070.941
1,620,242
BANK LOANS TO DIRECTORS
1919.
1919.
October
November
December
1920.
January
February
March
April
May
June
July
August
September
October
In the monthly returns to the government, Canadian
banks are requested to show the aggregate amount of loans
to directors and firms of which they are partners. The fig-
ures given below show that the course of these loans during
the past three years has not been anything out of the ordi-
nary. Expansion, of course, has taken place as general bus-
iness activity has increased: —
1918 1919 1920
January $8,282,811 $8,412,352 $10,193,668
February 8,124,358 8,935,094 10,486,347
March 9,490,098 9,513.529 10,838,430
April 8,004,424 9,274,523 11,192,329
May 7,967,892 7,919,869 10,753,595
June 8,013,622 7,275,448 10,506,652
July 7,642,280 8,645,725 10,408,321
August _- 7,544,298 8,545,891 10,514,251
September 7,227,344 9,135,518 9,641,328
October 7,329,893 8,837,140 9,951,009
November 8,749,377 10,742,309
December 9,021,436 9,573,924
January 7, 1921
THE MONETARY TIMES
55
BANK OF NEW ZEALAND
ESTABLISHED in 1861
Bankers to the Governnieiit of New Zealand, which holds Preference Shares in the Bank for $3,649,875, and
guarantees its Redeemable Stock .$2,579,186.
Paid-up Capital ($13,528,811) and Reserve Fund ($12,166,250) $25,695,061
Undivided Profits $713,039
Aggregate Assets at 31st March, 1920 $257,500,944
BOARD , OF DIRECTORS:
WELLINGTON, N.Z.
(Four are appointed by
New Zealand Govern-
ment ; two elected by
Ordinary Shareholders.)
H. BEAUCHAMP
(Chairman)
GEORGE ELLIOT
R. W. KANE
WM. REECE
J. H. UPTON
WM. WATvSON
HEAD OFFICE :
LONDON BOARD
FREDK. LUBBOCK
(Chairman)
THE RT. HON. LORD
CARNOCK, G.C.B.
ALEX. MICHIE
SIR. JAMES MILLvS,
K.C.M.G.
LONDON OFFICE
WELLINGTON, NEW ZEALAND. 1, Queen Victoria Street, E.G. 4.
General Manager : H. BUCKLETON, Manager ; ALEXANDER KAY.
{Auditors Appointed by New Zealand Government) :
RICHARD W. GIBBS, Chief Auditor. W. C. SNEATH (Price, Waterhouse & Co.), London Auditor.
THE BANK OF NEW ZEALAND has Branches or Agencies in all the principal cities and towns in New Zealand, in
Melbourne and Sydney (Australia), Suva and Levuka (Fiji), and Apia (Samoa), also Agents in all the principal Cities in the world.
The Bank has facilities for conducting every description of Banking business.
The Bank negotiates at any of its Branches Bills drawn in dollars under American Credits as well as those in sterling, and
it invites the establishment of such Credits. It also issues Drafts or Credits, either in dollars or sterling, on any of the princi-
pal cities in North America.
Chief Agents in Canada :
CANADIAN BANK OF COMMERCE. BANK OF MONTREAL.
American Express Company
Bank of Nova Scotia
Other Agents and Correspondents in Canada :
Bank of Ottawa
Dominion Bank
Dominion Express Company, Toronto
Chief Agents in New York: IRVING NATIONAL BANK.
Imperial Bank of Canada
Royal Bank of Canada
Chief Agents in San Francisco FIRST NATIONAL BANK OF SAN FRANCISCO.
Other
American Exchange National Bank,
New York
American Express Company
Bankers' Trust Company, New York
Bank of Bishop and Company, Honolulu
Bank of Italy
Bank of Montreal
Bank of Nova Scotia
Brown Brothers and Company, Boston
Canadian Bank of Commerce
Chartered Bank of India, Australia and
China
Chase National Bank, New York
Columbia Trust Company, New York
Crocker National Bank of San Francisco
Drexel & Company, Philadelphia.
Equitable Trust Company of New York
Agents and Correspondents in United
Farmers & Merchants National Bank.
Los Angeles
Farmers Loan and Trust Company, New
York
First National Bank of Boston
First National Bank of Chica,go
Greeneiiaum Sons Bank & Trust Co.,
Chicago
Guaranty Trust Company of New York
Hanover National Bank of the City of
New York
Hong-Kong & Shanghai Banking Corp.
Illinois Trust & Savings Bank, Chicago
International Banking Corporation
Mercantile Bank of the Americas, New
Orleans.
Mercantile Trust Co.. St, Louis
States :
Merchants National Bank of Boston
Morgan & Co., J. P., New York
National Bank of Commerce, vSt. Louis
National Bank of South Africa, Ltd.
National City Bank of New Y'ork
National Park Bank of New York
National Shawmut Bank, Boston
Northern Trust Company, Chicago
Philadelphia National Bank
Riggs National Bank of Washington,
DC.
Royal Bank of Canada
Standard Bank of South Africa, Ltd.
Walker Bros., Salt Lake City.
Yokohama Specie Bank, Ltd
THE MONETARY TIMES
Volume 66
Leading Bankers Forecasted Tightening of Credit
Views Expressed During Past Year Urged Caution, with Leaning Towards Pessimism
as to Business Outloolt — Sir Frederick Williams-Taylor on Loans and Deposits — No Desire
for Violent Exchange Fluctuations — Great Need for Public and Private Economy
CANADIAN bankers, from the beginning of 1920, took a
stand on the side of caution. This view they carried into
effect by a gradual restriction of credit, which action was not
altogether voluntary on their part because of the fact that t
would have been quite impossible to meet the demands for
money without causing over-inflation and danger to the banks
themselves and business organization as a whole. The figures
of banking for the year, showTi elsewhere in this issue, illus-
trate how this policy was put into effect.
Representative opinions of bankers, expressed for the
most part at the annual meetings, are given below. These
opinions indicate the line of action followed by the banks dur-
ing the year.
No Extra Profit in Exchange
H. B. Shaw, general manager of the Union Bank, at the
annual meeting on January 7, 1920 : —
"No permanent relief can be expected until the nations of
the world get together, without greed or selfish motives, and
in a frank and fearless manner face existing conditions. The
United States might very properly be expected to take the
lead. As far as we in Canada are concerned, time, production
and thrift are the only possible solvents. Exporters and im-
porters should not open credits or engage in contracts without
exercising the utmost caution. Inflation of the various cur-
rencies has caused exchange to become a most important ques-
tion. An erroneous idea prevails that the banks are respons-
ible for and making large profits out of the present situation.
This is, indeed, incorrect; the banks derive no extra profits as
the result of the hea\'y fluctuations in exchange. We shall,
indeed, welcome a return to normal conditions."
Time for Production
Sir Herbert S. Holt, president. Royal Bank of Canada, at
the annual meeting, January 8, 1920: — ■
"During the year just passed Canada has again proved
her ability to meet every emergency as it arises. Our soldiers
have been absorbed into civil life without strain, our indus-
tries have been readjusted with little unemployment, and the
unfailing response of our people to every patriotic call has
been shown by the immense over-subscription to the last Vic-
tory Loan. Despite an unfavorable harvest in some parts of
the w-est, the country is prosperous and the balance of trade
continues largely in our favor.
"Factors which have contributed to the prevailing high
prices are being gradually eliminated. Ocean transportation
sei-v-ice will soon far exceed that of the pre-war period and
stores which have accumulated in distant lands will, as a
result, become readily available. Industrial plants have mul-
tiplied and everywhere an aiTny of women workers has been
added to the ranks of labor. Moreover, Europe can only ulti-
mately pay its huge debts by a corresponding output of goods.
We shall then enter upon an era of greater supplies and keen
competition. If pi-ices fall in the future, as seems probable,
each dollar made and saved to-day will then have greater pur-
chasing power. We should, therefore, strive to produce to the
limit of our capacity while markets are high, and exercise the
most rigid economy in order that our gains may be conserved.
"The government is still discharging some of the heavy
obligations arising out of the war and the net public debt now
fast approaches two billion dollars. There are only two ways
of meeting this responsibility — greater industry and less ex-
travagance — prosperity is not unending or national borrow-
ing power unlimited. It is an unvarying economic law of
which we in Canada had a bitter experience following the Civil
Wai' — that all conflicts terminate in a period of prosperity and
inflation during reconstruction, which is succeeded by equal
or greater depression. For this inevitable reaction in the
future we should now be prepared, and it is the duty of the
government to set an example to the nation by abstaining
from all unnecessary or wasteful expenditure. It cannot be
too strongly urged or too often repeated that the greatest pos-
sible effort must be put forth in every direction if we are to
meet the amount required for interest and the redemption of
debt. It has been aptly said that governments have no income
outside that of the people, and that the wealth of a country,
like that of an individual, can only be built up by spending
less than is earned.
A Year of Surprises
Sir Edmund Walker, president of the Canadian Bank of
Commerce, at the annual meeting on January 13, 1920: —
"The difficulties of reconstruction after the great war are
even greater than we feared. The whole world is feeling the
effect of four years in which the ordinary work and economics
of life were not merely neglected, but the basis thereof was
almost swept away. We are short of almost every commod-
ity, the strongest evidence of this being the fact that millions
of people in Europe face actual starvation. We cannot re-
establish the normal supply of commodities except by work-
ing harder than usual, and we cannot lessen the terrible strain
of high prices without doing the extra work which will put an
end to the lack of commodities. We cannot adjust prices
without also bringing about a contraction in the volume of
paper money and other instruments of credit, and so far as
it is possible to enforce contraction without interfering with
the production of what is really necessary, the reduction of
prices will be facilitated. In a word, bankers should not aid
speculation or assist ventures which do not directly lead to
production. We are still building ships with feverish haste
throughout the world, and we ought to be spending large
sums on railroads in order that commodities may be freely
distributed. The present cost of ocean transportation, quite
as much as the cost of goods at the primary markets, stands
like a huge barrier across the pathway of return to normal
conditions. What is worse, how-ever, is that even present
prices, in the natural order of things, will go on rising until
the lack in the world's supply of commodities has been filled,
and there has been a large contraction in the volume of paper
money now in existence."
Need for Government Economy
W. G. Gooderham, president. Bank of Toronto, at the
annual meeting, January 14, 1920: —
"The indebtedness of the country has now reached an
amount that will prove a heavy burden for our present popu-
lation. So long as the war existed and such tremendous
issues were at stake, no sacrifice was too great to be taken in
supporting the government in their defence of the empire, but
the time has come when the best energies of the administra-
tion must be directed towards reducing expenditure in every
direction. No new indebtedness should be incurred excepting
such as will have the direct effect of increasing production, or
for such enterprises as will return sufficient revenue to fully
justify the expenditure. Every new demand upon the treas-
ury should be tested by these requirements, and every effort
should be made to lessen in every way the country's expendi-
ture.
"Upon the amount of our production depends the amount
and value of our exports, and to the increase of our exports
we must look for the means whereby we can comfortably carry
the burden of interest on our national debt. There is no
country that can look forward with greater hope and confi-
dence than Canada. We have immense potential resources.
January 7, 1921
THE MONETARY TIMES
57
How Do I
Make a Will?
FIRST — Decide how you wish to divide your property.
SECOND — Decide upon a competent, responsible Executor to carry out
the provisions of your Will.
THIRD — Have your wishes put in correct legal form by your solicitor.
FOURTH — Name the Union Trust Company to act as Executor and
Trustee under your Will. We have an enviable reputation for pains-
taking, prompt and economical settlement of estates — the result of
long study and experience, and a determination to serve well those
who do business with us.
We Welcome a confidential interview
Union Trust Company Limited
HENRY F. GOODERHAM, President
TORONTO — Richmond and Victoria Streets
WINNIPEG, MAN. LONDON, ENG.
4% on Savings — Withdrawable by Cheque
BANK OF HAMILTON
Head Office - HAMILTON
Established 1872
Capital Paid Up (November 30th, 1920) - - $4,946,360
Reserve Fund (November 30th, 1920) - - - $4,673,180
BOARD OF DIRECTORS:
Sir John Hendrie, K.C.M.G., C.V.O., President. Cyrus A. Birge, Vice-President.
C. C. Dalton Robert Hobson W. E. Phin I. Pithlado, K.C. J. Turnbull W. A. Wood
Branches at Montreal and throughout Ontario, the North-west and British Columbia.
Correspondents in Great Britian
National Provincial and Union Bank of England, Umited. Barclays Bank. Limited. London, ?:ngland
Correspondents in United States
Pittsburg— Exchange National Bank
Detroit— Eirst and Old Detroit National
Bank
Chicago — Continental and Commercial
National Bank
Cleveland — First National Bank
St. Louis — National Bank of Commerce
New York — Hanover National Bank
Mechanics and Metals Na-
tional Bank
National City Bank
Philadelphia— First National Bank
Boston — National Shawmut Bank
Buffalo — Marine Trust Co.
Kansas Citj' — National Bank of Com-
merce
Minneapolis — Northwestern National
Bank
Seattle — Bank of California
Sail Francisco — Crocker National Bank
Duluth — American Exchange National
Bank
Collections effected in all parts of Canada promptly and cheaply
CORRESPONDENCE SOLICITED. SAVINGS DEPARTMENT AT ALL BRANCHES
J. P. BELL, General Manager
58
THE MONETARY TIMES
Volume 66
and the development of them is certain to take place. It may
take time — perhaps it is better that we should grow steadily
rather than rapidly, but our future is certain to be a bright
one."
Recent Prosperity Was Not Sound
H. A. Richardson, general manager of the Bank of Nova
Scotia, at the annual meeting on January 28, 1920 : —
"During the past year conditions generally have been a good
deal confused, and while prosperity has been fairly general
throughout Canada, it has been of a somewhat feverish char-
acter, for there is the knowledge that it is based to a consider-
able extent on inflation. Similar conditions prevail in the
United States, where speculation in commodities and real
estate, in addition to the somewhat common speculation in
shares on Wall Street, has resulted in a considerable strain
on floating credit. Foreign trade has been hampered by ab-
normal exchange rates, labor has been unsettled and the oper-
ation of most businesses has been attended by considerable
anxiety. The press and the platform have teemed with
theories for the amelioration of the conditions confronting us,
and we have had what seems ample time to consider all aca-
demic remedies for the disposal of this aftermath of the war.
We should, therefore, without further loss of time, get down
to honest, hard work which, after all, is the real panacea for
our present troubles. If each and every person would give a
good account of himself in that respect, it must follow that
efficiency would obtain throughout our land, with the result
that, through increased production, the process of deflation
would forthwith begin, and we would then, year by year, find
our national debt being gradually absorbed and liquidated —
for that overhanging debt and the further needs of the gov-
ernment are in fact the outstanding matters of vital import-
ance to all of us, as we shall more fully realize a little later
on. It seems impossible that any one should fail to recognize
personal responsibility in connection with the financial obliga-
tions of our country. The debt was incurred to carry us
safely through the war, and it is only by individual effort that
it can be borne and finally liquidated. The matter is personal
to every citizen of Canada. It is therefore essential that work
and increased production be undertaken and persisted in, and
that personal and public expenditure be scrupulously kept
down to the last dollar. It would seem advisable, rather than
lay down maxims for others, that each individual, and partic-
ularly those responsible for the management of each business
enterprise, make certain that the work entrusted to him and
those under him is performed with the maximum of efficiency.
Given that, we shall gradually work back to normal conditions;
failing it, we are heading for serious trouble."
Widespread Rise in Prices
J. P. Bell, general manager of the Bank of Hamilton, at
the annual meeting on April 19, 1920, referred to the rise in
prices as world-wide, rather than local, and gave as some of
the causes the excessive issue of government bonds and note
circulation, the insistent and increasing demand for goods,
accompanied by disorganized and decreased production and
excessive taxes. Money being only a shadow of the substance
represented by commodities, the decrease in the production of
commodities has resulted in an increase in their price. He
then referred to the excess profits tax, and the heavy surtaxes
on the income tax, as a paralyzing element so far as the trade
of the country is concerned, and said that some other means
should be found of raising the revenue necessary to pay the
interest and gradually retire our war debts. The taxes made
it necessary for the price to be raised by each man through
whose hands the goods passed in order to realize cash to cover
his own taxes, a cumulative burden which would inevitably
result in a reaction in trade and restricted production, or de-
mands for credit which would be a dangerous strain on the
finances of the country, and which would prevent the natural
increase in capital needed for new enterprises and growing
business, excessive taxation being, therefore, a. large con-
comitant of the high cost of living and the prevailing discon-
tent. It would be necessary to speed up production and to
produce more of the necessities of life, both on the farm and
in the factory. At a time when more work and more goods
should be the watchword, everyone seemed to be trying to ob-
tain more leisure.
Room for More Population
G. T. Somers, president. Sterling Bank, at the annual
meeting on May 18, 1920: —
"While there is a good deal of talk and general unrest, I
have no fear as to the future prosperity of this country.
There is a good and comfortable living to be made here for
everyone. I believe we have a sound and contented popula-
tion whose judgment in the end will lead them to safe conclu-
sions, and govern their acts wisely. What we need most now,
which I emphasized before the war, is 'increased population
of a desirable type' to develop our resources and increase our
production."
Conditions Very Uncertain
Peleg Howland, president. Imperial Bank, at the annual
meeting. May 26, 1920:—
"It is hoped and believed that we will do well during the
coming year, but there was never a time in my recollection
when conditions were so uncertain, and when it was so difficult
to form an opinion, satisfactory at least to oneself, as to what
may be in store for us. Here is the situation in Canada as it
appears to me: Large government expenditures have been
sanctioned by parliament; outlays on the acquired railroads
must be made; public works, thougli curtailed, have not
ceased. Our pulp and paper industries have expanded enor-
mously, and are continuing their growth. There is demand
for lumber at extraordinary prices, and efforts are being made
to supply it. The manufacturers of nearly all kinds of goods,
with the exception of those making some lines of clothing, in-
cluding silks and boots and shoes, are as busy as labor, power
and transportation conditions will permit. Good returns are
promised from our fruits, furs, fish and minerals. Immigra-
tion has increased, the numbers being some 57,000 in 1918-19,
and 117,000 in 1919-20. There is investment of United States
funds in Canadian securities, industries and timber limits;
wages continue high, with indications that they have not
reached the limit, and there is an almost unlimited demand
for housing at any cost.
"Against all this we have the comparatively small resi.
due of crop left over from last year, the long, severe vrinter,
which has delayed seeding and prevented the proper prepara-
tion of the soil, with consequent reduced acreage and adverse
chances of good crops (although recent advices from the
northwest would indicate that the excellent conditions as to
moisture may go a long way to offset other drawbacks) ; the
loss of cattle and horses in the northwest from the severity of
the winter and the shortage of feed; the poor condition of
those remaining; the curtailment in the number of hogs be-
cause of the cost of production; the continued increase in the
amount of our imports and the decrease in our exports (in the
months of March and April the balance of trade was actually
against us) ; the growing public debt and the increasing bur-
den of taxation, municipal, provincial and Dominion; govern-
mental restrictions and interference with the natural course
of trade — for governmental efforts to provide liberally for
the weak, the needy and the helpless, while at the same time
curtailing or restricting the amount of labor or effort, which
should be greater if help of this kind is to be provided. Put
the favorable against the unfavorable, and judge for your-
selves.
Selective Curtailment of Credit
D. C. Macarow, general manager of the Merchants Bank,
at the annual meeting on June 2, 1920: —
"The demand for borrowed capital continues to be more
or less importunate, and it is in the conservation of credit and
the equitable rationing of it that banks can play, and indeed
are playing, a sound constructive role. Legitimate productive
enterprises are being fostered and encouraged fairly, while at
the same time a firmly restraining hand is held upon unpro-
ductive, non-essential and speculative undertakings. This pol-
icy of selective curtailment, so to put it, operating as it does
at the very root of existing evils, and applied \vith due judg-
ment, discrimination and consistency, cannot but prove a bene-
January 7, 1921
THE MONETARY TIMES
59
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affairs and make it a matter of further pride to have
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Trust Company — as the Executor and Trustee of your Will.
This Corporation offers to its clients the benefits of
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Consult us to-day regarding your Will.
Friendly counsel gladly given.
A. D. LANGMUIR, W. G. WATSON,
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Total Assets Exceed $100,000,000^
Head Office :
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Ottawa
Wiiiuipeg
Branches :
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IHE Toronto General Trusts Corporation
THE MONETARY TIMES
Volume 66
ficial corrective and an importantly contributing factor toward
restoring, with a minimum of dislocation and disturbance,
healthy and normal conditions in the body politic.
"I might here venture to say that it is a matter of grati-
fication to see our mercantile marine growing apace and to
know that the government will have, it is understood, some 45
mei-chant vessels in commission by the end of July next. I
mentioned last year, and I reaffirm the opinion then expressed,
that there is nothing of greater national importance than the
establishment of our own lines of ocean transport, and what
has been and is being accomplished in this direction, both by
the government and by private enterprise, augurs well for
the future safety and stability of the country's trade and com-
merce.
"After what looked like in some respects an ominous start
the crop situation throughout the country now seems to justify
the belief that good yields will be secured this year. Predic-
tions, however, are futile, and we can only nurse the hope that
actual results will fairly measure up to present optimistic
estimates. Certainly, on the theory of averages alone, we are
entitled to look for some redress in the crop situation this
year. Much depends upon it, more especially in view of the
disappointing results of the last two years, and if nature is
benevolent in the coming harvest, this country will benefit to
an unmeasured extent, and we shall be reasonably in a posi-
tion to view the period of deflation, upon the threshold of
which we stand, with feelings of confidence as to our immedi-
ate future — as to our ultimate future there need be no mis-
giving, for it must be borne in mind that Canada is a young
and virile country of almost limitless possibilities and im-
mense natural resources awaiting development; that its man-
hood is strong, enterprising, thoughtful and sane."
Gradual Deflation
R. Audette, president. La Banque National, at the annual
meetmg on June 9, 1920: —
"We believe that this year will see a diminution in the
advances made to the public and that prudence will oblige the
banks to curtail and choose 'more carefully the operations in
whach they will interest themselves. The facilities which have
been offered by the government during the war will grow less;
the banks who have bororwed will have to reimburse, and this
will allow the government to withdraw a good proportion of
its paper and, to a great extent, re-establish the gold basis it
had before the war. However, this should not be done at the
expense of production. It is evident that, if the government
collects Its loans too suddenly and obliges the banks to hamper
production, it will cause a greater evil; as, if by such a line
of conduct, our exports with the United States decrease and
our imports are the same, our money, which, in relation to the
United States, was worth 10 per cent, to 15 per cent, all the
year less than theirs, will be worth still less, whatever the
gold guarantee the government may have for its paper. What
is wanted for the welfare of Canada is to import only what is
strictly wanted, not to accumulate any goods for speculation
especially necessities of life. We must produce and produce
still more, so that the balance of trade will be in our favor."
Effects of New Taxes
H. J. Daly, president, Home Bank, at the annual meeting,
June 29, 1920:—
"There probably will be some temporary setback to busi-
ness through the levy of taxes under the new budget. The
difficulties of framing this measure of taxation are generally
appreciated, as is evidenced in the willingness of business in-
terests to meet conditions brought about by the application of
the new levy. The national debt is there, to be paid off as
expeditiously as may be accomplished without disturbing the
accustomed channels of industry and trade. Exports and pro-
duction cannot be taxed. The presumption is that the tax
may be raised from what the people can comfortably spare
and what may be added to the overhead charges of the man-
ufacturing and trade without hindering activity in these
spheres. The budget aims in these directions and \vill in all
likelihood be ultimately brought to operate equitably in the
minor features of its detail."
Adverse Trade Balance
Tancrede Bienvenu, general manager of the Banque Pro-
vinciale du Canada, at the annual meeting on August 11,
1920:—
"The balance of trade with the United States this year
shows a heavy deficit against our country. We are convinced
that it is the imperative duty of Canada to reform its position
in this regard, for such an adverse balance is without doubt
the first cause of the depreciation of our currency in the
United States. An intense utilization of all our resources,
economy and production to the utmost extent, and most im-
portant of all, restrictions in importation of luxuries, will
facilitate the task to which of necessity conditions of the pres-
ent time oblige us."
Deposits Fail to Keep Up
William Molson Macpherson, president of the Molsons
Bank, at the annua-l meeting on November 2: —
"The deposits of the Canadian public in the chartered
banks of Canada show an increase for the year of $70,000,000,
but the bank loans in Canada have increa'Sed by $360,000,000.
This justifies the banks in their present policy of restricting
loans. You are doubtless aware that for the past four or five
years the Canadian banks have supplied their customers with
the necessary funds to conduct their business with little, if
s-ny, increase in discount rates, and our customers at the pre-
sent time are discounting their bills at lower rates than can
be obtained in Great Britain or the United States. We are
sure that the Canadian public must value the steady money
market they have enjoyed all through these troublesome times.
"The period of falling prices has begun and provided the
drop is gradual and not violent, our people should be able to
meet the changing conditions without difficulty. Most of our
manufacturing and trading firms have prospered so well dur-
ing the past few years that they are in a good financial condi-
tion to meet a period of readjustment without embarrassment.
Comparison With United States
Sir Frederick Williams-Taylor, general manager of the
Bank of Montreal, at the annual meeting on December 5: —
"As comparisons are constantly made between Canada
and the United States, owing to general similarity in con-
ditions, one anomaly attracts attention, viz.: that with credit
restriction as acute here as it is across the line, the price of
money is materially lower in the Dominion.
"This condition, in days of world-wide high interest rates,
has a^ttracted much attention in other countries and is re-
garded as a tribute to Canada's good banking system. The
one disadvantage of this cheap money condition is that per-
sons on fixed incomes derived from investments face the
higher cost of living, including income tax, with little in-
crease in revenue.
"With reference to current loans in Canada-, your Direc-
tors have felt impelled for many months past, in the Bank's
and the country's best interests, to follow the policy found
essential in every other country, and keep within bounds our
advances to merchants and manufacturers. This policy is in
accordance with the views of the Dominion Government and
has been followed, more or less closely, by aJl Canadian banks.
"Naturally enough, exception has been taken in certain
quarters to such restrictions, but, as a rule, our customers
have recognized the necessity of checking over-trading and
further expansion in such times as we are now facing. There
has never been a period in our experience when requests
for advances for purposes out of the ordinary have been so
numerous.
"It is safe to say that had credit been granted freely and
banking resources become tied up, a serious condition would
have resulted in this country. Already the tide has turned
and many of our friends now frankly admit the danger of the
undue expansion so much in evidence a few months &go. We
are convinced that the business of Canada is in a safer and
sounder position to-day in consequence of a judicious credit
restriction."
January 7, 1921
THE MONETARY TIMES
Capital, $2,000,000
Reserve, $2,000,000
National Trust Company
Limited
Executor Guardian Administrator Assignee Trustee Liquidator
President: SIR JOSEPH FLAVELLE, Bart.
Vice-Presidents: E. R. WOOD, W. E. RUNDLE.
W. E. RUNDLE, General Manager.
Chester D. Massey
H. C. Cox
H. H. FUDGER
H. B. Walker
Hon. Sir Edward Kemp, K.C.M.G.
J. H. Plummer
Board of Directors :
Hon. F. H. Phippen, K.C.
H. J. Fuller
T. B. Macaulay
W. M. Birks
E. M. Saunders
Sir John Aird
Thomas Findley
Fred. W. Harcourt, K.C.
James Ryrie
Hon. Sir Thomas White, K.C.M.G.
Miller Lash
Harrington E. Walker
Norman J. Dawes
Head Office: 18-22 Kin^ Street East, Toronto
Montreal
Winnipeg
Regina
Saskatoon
London, England
BANKING
INFORMATION
During the six months ending Dec. 31st,
1920, The Monetary Times of Canada
published no fewer than forty-three (43)
different articles that were of direct and
vital concern to the practical banker.
This was exclusive of banking statistics,
clearing house returns, branch bank
notes, etc.
In addition, each issue contained a great
volume of information on investments,
insurance (all classes), all of which have
interest for those concerned with the dir-
ection of banking activities.
The subscription price of The Monetary
Times (including The Monetary Times
Annual) is $3.00 a year postpaid.
Monetary Times of Canada
TORONTO
The Home Bank
of Canada
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is in ready communication with the
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ments at the Head Office, and any
enquiries made through any branch
will receive prompt attention.
Branches and Connections throughout Canada.
Head Office—
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THE MONETARY TIMES
Volume 66
Recent Legal Decisions on Canadian Banking
Sections 77, 90 and 176 Interpreted During Past Year— Bank Must
Ascertain Agent's Authority — No Authority to Guarantee Payment to
Third Party — Drawer of Draft Personally Liable for Misrepresentation
in Bank Should Have Advised of Privileged Lien on Its Own Stock
T TNCERTAINTY as to the meaning of certain sections of the
*-^ Canadian Bank Act have again brought banking questions
into the higher courts of this country. The sections on which
the most important decisions were made this year were sec-
tions 176, 90 and 77.
King vs. Royal Bank
In the case of the King vs. Royal Bank of Canada the
Manitoba Court of Appeal held that the burden of proving the
authority of a government agent to receive payment of a
cheque, drawn on a certain bank, payable to "Dominion Gov-
ernment Elevator Company," rested upon that bank.
The action was brought on a cheque for $673.68 drawn by
Woodward & Co., grain merchants, on the Grain Exchange
branch of the Royal Bank of Canada, in favor of "Dominion
Govei-nment Elevator Company." The words "Canadian Gov-
ernment Elevator" were stamped on the back of the cheque
with a rubber stamp, and underneath those words there was
written "Per F. S. Burgess." The cheque in question was
given in payment of charges due from Woodward & Co. to the
Dominion government in connection with wheat received and
stored at the tei'minal elevator at Port Arthur. It was claimed
that the proceeds of the cheque were improperly paid by the
bank to O. S. Burgess, who was in charge of the Dominion
government elevator business at Winnipeg, and who kept the
money for his own use. The duty of Burgess to make deposit
of all funds received by him was not only specifically set forth
to him in written instructions, but was statutory, and he had
no authority to expend any money for any purpose whatever.
Bank Assumed Too Much
In giving judgment against the bank the court said: "The
actual authority of Burgess is determined by the letters and
oral instructions referred to. He was authorized to take
cheques or money in exchange for warehouse receipts and to
make deposits to the credit of the Receiver-General. Without
any express representation being made, the bank teller as-
sumed that Burgess was the manager of a grain company,
with full powers as such. In this the teller was clearly negli-
gent. Moreover, the endorsernent, 'Canadian Government
Elevator, per F. S. Burgess,' was direct notice that the cheque
was being negotiated, not by the owner but by an agent 'per
proc' By section 51 of the Bills of Exchange Act a signature
by procuration operates as notice that the agent has but lim-
ited authority to sign, and the principal is bound by such signa-
ture only if the agent in so signing was acting within the
actual limits of his authority. In this case the endorsement,
'Per F. S. Burgess,' was sufficient to put the bank upon en-
quiry as to the agents' authority. Upon the whole case, I am
of opinion that the defendant bank has failed to establish the
agency of Burgess, actual or ostensible, to receive this sum of
money over their counter, and has failed to show that it ac-
quired any title to the cheque in question by means of a valid
endorsement."
Merchants Bank vs. Stevens
In the next notable case, that of the Merchants Bank vs.
Stevens, the question came up as to whether a bank could
guarantee the payment of a debt due a third party, the Mani-
toba Court of Appeal distinctly holding (1) that a letter writ-
ten on the bank's stationery and signed by the bank manager
to guarantee the payment of a debt due a third party was not
binding upon the bank, and (2) that the bank manager had no
authority to give such a guarantee, and in doing so was not
acting within the scope of his employment.
Briefly, the facts of the case were that the Winnipeg
Motor Exchange Company, an unincorporated company, had
been in operation in Winnipeg, and in the course of its business
the company became largely indebted to the Merchants Bank,
the account being kept at the main branch, which was under
the management of one Paterson. In August, 1917, the com-
pany's indebtedness to the bank amounted to about $40,000,
which amount Paterson was ordered by the general manager
to reduce, but to which order he paid no attention. During
the same month Paterson was instrumental in obtaining a sale
of the business, the bank advancing $5,000, and the name of
the company being changed to the Winnipeg Motor Company.
As far as the bank was concerned, no improvement resulted,
and Paterson continued initialing post-dated cheques to aid
the company in securing further loans. On October 8th, 1917,
the company negotiated a loan with Stevens, the respondent,
for $10,000, to be paid in four installments. As security for
the repayment of the loan the company gave to Stevens four
post-dated cheques on the defendant bank, bearing the dates
of the installments and for corresponding amounts. Paterson
placed his initials on the lower left-hand comer of each
cheque. He also signed and gave to Stevens the following let-
ter: "In connection with the loan of $10,000, which we under-
stand you are gi-anting to the Winnipeg Motor Company, to be
repaid, and etc., we beg to notify you that this bank is pre-
pared to grant the company a credit sufficiently large to enable
them to take up these installments as they mature and hereby
guarantees the payment of the said loan." The money received
from Stevens was deposited to the credit of the company in its
ordinary chequing account in the bank.
The bank refused payment of the cheques and Stevens
then brought action to enforce payment.
No Guaranteeing Power in Bank Act
In the decision the court said: "Apart from the question
of ratification, the real point involved in this appeal is the
power of the bank to give the guarantee. The powers which
a bank may exercise are set out in section 176 and following
sections of the Bank Act. No power to give guarantees is
specifically given by the Bank Act. Any such power must be
derived by necessary implication from the words of the act.
The only words in the act which can possibly be appealed to
are the words in section 76, subsection 1 (d) : "Engage in and
carry on such business generally as appertains to the business
of banking." The question then is whether these words by
necessary implication give the bank power to guarantee the
repayment of a loan by a third party to a customer of tha
bank. When it is remembered that the bank itself is given
specific power to loan money, and that the loaning of money
to its customers is in fact its chief business, it is difficult to
discover any ground for implying a power to guarantee the
repayment of loans made by others. It was argued that rep-
resentations made by the agent, even if fraudulent, bind the
principal, and, as a rule, this is the law. But it is impossible
in my opinion to rely upon the verbal promises of the manager
when the contract has been reduced to writing in the form of
a letter. Even if they could be relied upon, the plaintiff on",e
again returns to the position of seeking to enforce a guarantee,
verbal this time, made by the manager as agent for the bank
which had no power to enter into it. From this standpoint
there can be no ratification of the manager's action, for there
can be no ratification of any ultra vires contract.
"In my view, the giving of the guarantee or undertak-
ing in his case was unauthorized by the Bank Act, and that dis-
poses of the whole case."
Bank of Nova Scotia vs. Hatfield
Another case, which dealt with section 90 of the Bank Act,
was that of Bank of Nova Scotia vs. Hatfield, which arose out
January 7, 1921 THE MONETARY TIMES 63
THE MERCHANTS BANK OF CANADA
Established 1864 HEAD OFFICE: MONTREAL
Paid-up Capital - - $8,400,000 Total Deposits (30th October, 1920) over $170,000,000
Reserve Funds and Undivided Profits 8,660,774 Total Assets (30th October, 1920) over 209,000,000
Board of Directors:
SIR H. MONTAGU ALI^AN, C.V.O. President
A. J. DAWES . - - - Vice-President
Sir F. Orr Orr-Lewis, Bart. Hon. C. C. Ballantyne F. Howard Wii^on
Farquhar Robertson Geo. L. Cains Alfred B. Evans
Thomas Ahearn Lt.-Col. J. R. Moodie Lorne C. Webster
E. W. Kneeland Gordon M. McGregor
General Manager - • - - - D. C. Macarow
Superintendent of Branches and Chief Inspector : T. E. Merrett
General Supervisor ■ - - - - W. A. Meldrum
A GENERAL BANKING BUSINESS TRANSACTED.
399 Branches and Agencies in Canada extending from the Atlantic to the Pacific
New York Agency : 63 and 65 Wall Street London, England, Office : 53 Comhilt
W. M. RAMSAY and C. J. CROOK ALL, Agents J. B. DONNELLY, D.S.O., Manager
THE
TRADERS TRUST COMPANY
Authorized Capital - - ' - $500,000.00
Subscribed and Paid Up - - $100,000.00
Authorized Trustee to Act under the Bankruptcy Act in the Provinces of
Manitoba, Saskatchewan, and Alberta
EXECUTORS
J. B. NICHOLSON. ADMINISTRATORS AND ^- ^^ campbell.
President - — • ^ ice-rresidcnt
FINANCIAL AGENTS
Head Office : WINNIPEG. Branch Offices : Regina, Saskatoon, Edmonton
BANKERS: Merchants Bank of Canada.
64
THE MONETARY TIMES
Volume 66
of the acceptance by Hatfield and the discounting by the bank
of a certain draft, and an action commenced in 1918 in regard
to the matter had been dismissed, but "without prejudice, how-
ever, to any action which might be taken by the plaintiff
against any person or persons whatever on or in respect of
the bill of exchange sued on." This action was then brought
by the bank against Hatfield as acceptor.
The facts of the case were that the firm of Hatfield &
Scott of New Brunswick and Montreal had made arrange-
ments to buy carloads of apples from Edward Harrison of
Kentville. N.S., to be paid by drafts drawn by Harrison, and
to which the bills of lading were to be attached. On Decem-
ber 8th, 1917, Hatfield and Harrison called upon the agent of
the Bank of Nova Scotia, and the agent of the bank said he
filled in the date in a form of draft and also the words "at
sight." Harrison signed the draft as drawn and Hatfield ac-
cepted the draft as it then was by writing at the foot of the
draft, "O.K., Hatfield & Scott Co., Ltd., per H. H. Hatfield," and
the draft was afterwards filled in for the sum of $927.50, the
draft being drawn on Hatfield & Scott, Ltd., Monti-eal. The
draft was discounted by the Bank of Nova Scotia and the pro-
ceeds placed to the credit of Edward Harrison. The evidence
further showed that although Hatfield & Scott had applied for
incorporation, they had not at the time received their letters
of incorporation, but believed in the interval they vs'ere an in-
corporated company. Further, the evidence showed that Hat-
field had not been legally authorized by the company (which
in reality did not at the time exist) to act as its agent, but
that he did so.
Decision of the Court
In deciding the case Mr. Justice Chandler says: "Consid-
ering that Hatfield knew- when he accepted the draft sued on
that it was to be used immediately in order to put Edw-ard
Harrison in funds, and that it was absolutely useless and futile
for Hatfield to accept the draft if the draft was not to be valid
or used until a bill of lading for a carload of apples was at-
tached to it, and that this particular draft was discounted by
the bank and the proceeds placed to the credit of Edward Har-
rison's account on December 10, 1917, I have come to the con-
clusion that the draft was not accepted by Hatfield condition-
ally, as contended by him. If the draft was not to be used — that
is, discounted by the bank — until a bill of lading for apples was
attached to it, what was the use of Hatfield's acceptance ? In
the course of business between Edward Harrison and Hatfield
& Scott prior to this date, any drafts drawn by Harrison on
Hatfield & Scott Co., Ltd., to which bills of lading were at-
tached, were paid by Hatfield & Scott at Montreal on presenta-
tion, and if this particular draft was to be held until a bill of
lading was attached to it in order to secure payment, all that
took place between Hatfield and the bank's agent when this
draft was in part prepared and accepted by Hatfield amounts
to nothing whatever, and has no effect.
"If, as stated by Hatfield, the bank manager had waited
tmtil Harrison had brought in a bill of lading to be attached
to the draft accepted by Hatfield before sending it forward for
payment, the bank would have lost the benefit of the bill of
lading as security for the payment of the draft. Section 90 of
the Bank Act provides that the bank shall not acquire or hold
any warehouse receipt or bill of lading or any such security as
aforesaid to secure the payment of any bill, note, draft or
liability unless such bill, note, etc., is negotiated or contracted
at the time of the acquisition thereof by the bank. If the
manager of the bank had acted as Hatfield claims he agreed
to do, the bank would have lost the security of the bill of lad-
ing as the draft accepted by Hatfield was negotiated or dis-
counted on December 10th, at which time admittedly there was
no bill of lading available to be attached to the draft and to
secure its pajTnent. It is unlikely that the manager had alto-
gether overlooked the provisions of section 90 of the Bank
Act in connection w'ith this transaction.
"I think that the defendant Hatfield is liable by reason of
his representation that he had authority to accept the draft
sued upon as agent for Hatfield & Scott Co., Ltd., and that by
his conduct he warranted that he had such authority. Though
Hatfield does not seem to have been aware of the fact at the
time, there was no such corporation as Hatfield & Scott Co.,
Ltd., in existence on the date when the draft sued on was ac-
cepted, but the ignorance of Hatfield on this point does not
affect his liability."
Lazard Bros. vs. Union Bank
The next case dealing with the Bank Act was that of
Lazard Bros. vs. Union Bank of Canada, which came under
section 77 of the act. The facts of the case were that the
late E. E. A. Duvei'net, having arranged with Lazai'd Bros,
of London for a loan, promised to deposit with the Union
Trust Company, as trustee for Lazard Bros., 500 shares of the
Union Bank and 500 shares of the Union Trust Company as
security. The dispute arose over the ownership of 200 shares
of the Union Bank which were held in trust for Lazard Bros,
by means of a stock certificate. The bank claimed ownership
of the shares in question because of a debt owing it by Duver-
net, and because of section 77 of the Bank Act, which provides:
"The bank shall have a privileged lien for any debt or liability
to the bank on the shares of its own capital stock and on any
unpaid dividends of the debtor or person liable, and may de-
cline to allow any transfer of the shares of such debtor or per-
son until the debt is paid."
The bank officials knew ill the details of the loan by
Lazard Bros, and the security on which the loan was made.
Knowing these facts, and knowing of their lien on Duvemet's
shares, which Duvernet was pledging as his owm absolutely,
the bank should have notified Lazard Bros.
His Lordship in deciding the case said in part: "Before
discussing the law I would point out that the certificate depos-
ited with the Union Trust Company afforded no protection to
the plaintiffs. It in no way represented the shares. It was a
mere statement that at its date the shares were standing in
the name of Duvernet. The power of attorney would enable
the holder to make a transfer on the books of the bank, but
there was nothing to prevent Duvernet from dealing with the
stock in the meantime. The production or surrender of the
certificate was not necessary to the transfer of the stock and
there was nothing to prevent the issue of any number of cer-
tificates, each stating the same fact, that Duvemet's name
appeared upon the register as the holder of so many shares.
"In this case I have no hesitation in finding that there was
a duty upon the part of the bank to disclose its lien, and that
failure to disclose was fraudulent in the sense that it was in-
tended to allow the plaintiffs to assume the liability incident
to the acceptance of the bills without the security they thought
they had."
LETTERS OF CREDIT AN INDISPENSABLE
CONVENIENCE
Previous to 1917, letters of credit issued by Canadian
banks were not used very extensively because the conveni-
ence afforded was not sufficient. To-day, however, this fa-
cility is found to be practically indispensable by the im-
porting Canadian and the business man travelling abroad.
Letters of credit issued by Canadian banks are recognized
in practically all the important centres of the world, because
of the banks' extensive connections. It will be seen from
the following figures, which have been taken from the
monthly bank statement under the heading of "liabilities of
customers under letters of credit," how the use of this fa-
cility has grown. The figures also reflex, to some extent, the
development of our foreign trade: —
1917. 1918. 1919. 1920-
January $ 9.377,150 $20,781,228 $33,693,463 $47,967,989
February 9,888,080 20,124.613 31,201,120 46,900.376
March 10,954,633 20,646.226 28,928,930 42,939,486
April 10,623,216 21.563,672 22.079,366 48.794,655
May 12,665.722 17,665,401 20,669,010 50,828,266
June 15,601,123 21,652,323 23,811,176 46,470,631
July 16,260,225 23,428,320 28.746,346 43.261,195
August 16.990,296 21.244,247 30,638,645 42,754,911
September 17.258,539 21,451,481 34,752.308 43,589,081
October 17,320,360 29,318,113 42,787,234 47.635.099
November 21,886,093 32,259.631 50,485,107
December 21,981,345 33,670,067 61,188,148
Januarv 7, 1921
THE MONETARY TIMES
65
llllllllllllllllll
THE BANK OF NOVA SCOTIA
ESTABLISHED 1832
CAPITAL PAID UP
RESERVE FUND
TOTAL ASSETS
$ 9,700,000
18,000,000
240,000,000
1 Head Office
HALIFAX, N.S. m
GENERAL MANAGER'S OFFICE
H. A. RICHARDSON,
TORONTO, ONT.
General Manager.
44 in Nova Scotia
12 in Prince Edward Island
BRANCHES IN CANADA
129 in Ontario
42 in New Brunswick
22 in Quebec
35 in ^Vestern Provinces
CUBA .
PORTO RICO
JAMAICA .
NEWFOUNDLAND
St. John's and 25 other points
WEST INDIES
Havana
Fajardo, Ponce, San Juan
Kingston and 10 other points
DOMINICAN REPUBLIC . Santo Domingo and San Pedro de Macoris
UNITED STATES
3oston
Ch
icago
New York (Agency)
GREAT BRITAIN
LONDON, ENGLAND ... 55 Old Broad Street, E.C. 2.
Correspondents
GREAT BRITAIN— London Joint City & Midland Bank Limited; Royal Bank of Scotland.
FRANCE -Credit Lyonnais.
UNITED STATES— Bank of New York, N.B.A., New York; National Bank of Commerce, New
'i'ork ; Merchants National Bank, Boston ; First National Bank, Chicago ; Fourth Street National Bank,
Philadelphia; Citizens National Bank, Baltimore; American National Bank, San Francisco; First
National Bank, Minneapolis ; First National Bank, Seattle.
Illlllil
THE MONETARY TIMES
Volume 66
Trade Situation Explains Exchange Dislocation
War Time Trade and Currency Difficulties Have Thrown Settlement Mactiinery
Out of Gear — Foreign Exchange Dealings in Canada, and Methods of Calculating-
Different Rates — Bank is the Dealer, Fixing Rate to Adjust Supply and Demand
By A. B. BARKER
MONEY has been defined as a commodity which mankind
accepts in exchange for other commodities and services.
Many substances have been used as money, but gold and
silver have gradually supplanted all other commodities owing
to their peculiar adaptability for use as media of exchange,
and to-day gold is accepted by the nations of the world as
the basic measure of monetary value.
The early coins were simply lumps of rhetal, with a mark
certifying the weight of metal stamped on them by a ham-
mer, and this is all that the coins of to-day indicate. In
coining money no government guarantees the value, but
merely the weight and fineness of the metal in the coin.
The government declares what shall be legal tender in the
payment of debts within its jurisdiction, but the real value
and standing of the coins depend entirely on the willingness
of the inhabitants to accept them in exchange for goods
and services.
Gold being the common standard, and silver used only in
the subsidiary coinage, all prices are quoted in turns by gold.
Goods Exchanged for Goods
Trade, whether by ■ barter, as in primitive times, or
through the present three-cornered system by the inter-
mediary of money or credit,- consists in the exchange of goods
for other goods. The use of money as an intermediary
merely facilitates the exchange by permitting the division
into smaller and more convenient units. One of the argu-
ments often heard is that by dealing at home the money is
"saved," but money is not the one thing for which trade is
carried on. Men sell commodities to dealers for money, and
this money is turned over for the puchase of other goods; but
in the final analysis it all comes back to the exchange of
goods for other goods, or for services. Money, to be of
use, must be used as it is intended, a measure of value and
a medium of exchange. As Ben Johnson once said: "Money,
to be sure, of itself is of no use, for its only use is to part
with it."
As trade increased, it was found that these exchanges
could more easily be arranged by means of credits, which
would, more or less, cancel each other, only the final balances
being settled in gold, and the degree of civilization to which
a country has attained may be largely measured by the per-
fection of its machinery for handling these credits.
These credits are exchange, and exchange, domestic or
foreign, is in reality a commodity in the same sense that
poi'k, or molasses, are commodities. Like them, it is a manu-
factured product, may be bought and sold on the market, and
is subject to the same law of supply and demand.
Exchange is Result of Trade
Exchange is produced by trade in commodities. If a
shoe manufacturer in Quebec ships his wares to a whole-
saler in Toronto, a debt is created in his favor from the
wholesaler, and this debt is exchange, domestic exchange, as
both parties live in the same country. This debt is payable
in the legal tender of Canada. Until the debt is paid it
belongs to the manufacturer, and he may sell it, or dispose
of it as he will. The usual course is for the manufacturer
to draw a draft for the amount of the debt on the Toronto
wholesaler, and discount it with his bank in Quebec — i.e., he
.sells the draft to the bank, which then becomes the owner
of so much Toronto exchange, or funds. These funds, or
exchange, the bank in turn sells to some one who has a debt
to pay in Toronto, or it may hold the amount iri Toronto,
and lend it to a customer of its branch in that city.
Foreign exchange is produced through the sale of com-
modities by an inhabitant of one country to an inhabitant of
another country. Countries do not trade with countries as
such. Trade is entirely between individuals. Foreign ex-
change is slightly more complicated than the domestic ex-
change, in that the settlement must be made in gold. The
principles are, however, the same. A Canadian exporter
ships grain to Liverpool, the result is sterling exchange — i.e.,
the right to money in Britain, which is made available
through the banking systems of Great Britain and Canada,
to discharge a debt owing by a Canadian firm importing
British goods, the transfers being made by bills of exchange.
The sum of similar transactions between two countries may
result in a balance due from one to another, and this differ-
ence is termed the balance of trade. It is this balance which
determines the rate of exchange. Theoretically this difference
is payable in gold, and the cost of shipping gold either way
will determine the premium, or discount, which the debtor
will pay, or the creditor accept, for a bill of exchange, in
preference to taking the trouble to ship the actual bullion.
There are other ways of avoiding the shipment of gold
between countries, the sale of securities and loans being the
chief methods.
The bank's relation to exchange is that of a merchant.
It buys and sells exchange in exactly the same way a grocer
deals in his wares. It buys, as be does, at wholesale prices,
and sells at retail, and its profit depends on the voldme of
its turnover.
Pre-War Quotationf, Near Par
In pre-war days, when foreign trade was on a normal
basis, the exchanges between countries fluctuated within nar-
row limits, and between Canada and the United States the
range varied in large transactions between 1/10 of 1 per
cent, above or below par, and for this reason the public gen-
ei'ally ceased to look on New York funds as foreign exchange.
One result was that the charge made, when a cheque on New
Yoi'k was negotiated, came to be looked on as a commission,
and now that these funds rule at a high premium, many still
persist in regarding it as a commission, or charge for ser-
vice. One great reason for the current misunderstanding in
the case of New York exchange is that the unit of value —
the dollar — is the same in both countries, as is also the
statutory gold contents of 25.8 grains 9/10 fine.
In normal times, thanks to our connection with Great
Britain, both politically and commercially, we were able to
obtain sufficient gold, or, what answered the purpose as well,
sterling exchange, to hold our funds at par, or close to it,
in New York. Now, however, owing to the change in the
financial relations between Great Britain and the United
States, the latter country becoming a creditor instead of a
debtor nation, our former source of supply has been cut off,
-for the present at least, and we have to rely on our own
resources. The result has been that the adverse balance in
favor of the United States has had its natural effect, and
our funds are at a discount in that country.
New York Rate is Important
The current rate for New York funds touches Canadian
economic life very closely, as, owing to our geographical
position and habits of trade, we are dependent on that centre
in all our exchange dealings with Europe, as well as those
with China and Japan. Before the war we puixhased chiefly
from the United States, and our chief exports were to Great
Britain, buying from the United States much more than we
January 7, 1921 THE MONETARY TIMES
'^IIIIIMinilMIIIIIIIIIIIIIMIIIIIIIIIIIIIIIIMIIIIIIIIIIIIIHIIIlMlilllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllll^
I IMPERIAL BANK I
I OF CANADA |
I Capital Paid Up $7,000,000 I
I Reserve Fund $7,500,000 I
i 214 Branches in Canada. E
E The Imperial Bank of Canada is a highly specialized organization, providing every =
E modern banking convenience at each of its 214 branches in the Dominion. =
= Since its establishment, over forty-four j'ears ago, this institution has enlarged its E
= capacities to meet the growing demands following Canada's steady development, and E
= takes pride in the efficiencj' of its service. ^
E Whether it be in connection with Collections of Drafts, Money Orders, Letters of E
E Credit, Government and Municipal Securities, a Savings Account or a Safety Deposit =
E Box, the special requirement of each individual client receives prompt and accurate =
E fulfilment. E
E Our Foreign Affiliations. E
While confining the sphere of our direct activities within the borders of the
Dominion, we are affiliated with strong banks abroad. Through their co-operation,
we are enabled to offer a complete world-wide financial service.
Agents in Great Britain Agents in United States
E England — New York — •
= Lloyd's Bank Limited, London, and The Bank of the Manhattan Company ;
I branches. Chicago— ;
E First National Bank \
I Scotland— Buffalo— j
E The Commercial Bank of Scotland, The Marine Trust Co. i
= Edinburgh, and Branches. Detroit ■
E First and Old Detroit National Bank :
I Ireland— ' San Francisco— j
E The Bank of Ireland, Dublin, and Wells-Fargo Nevada National Bank, i
E branches. and in all other principal centres. '■
E Agents in France i
E Lloyd's Bank (France) and the National Provincial Bank (France) Limited. •
I PELEG HOWLAND, President. W. MOFFAT, General Manager. I
I HEAD OFFICE - TORONTO |
?iiniiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii
68
THE MONETARY TIMES
Volume 66
sold, and selling- to Great Britain much more than we pur-
chased from her. As the United States was then indebted
to Great Britain, we were able to transfer our claims against
Great Britain to the United States by selling sterling ex-
change in New York, and with the funds so obtained, settling
our debts in the United States. This kept the balances be-
tween us normal, and the question of a premium or a dis-
count on our transactions with New York was of compara-
tively little moment.
Now, however, this is all changed. We still rely on the
United States to furnish the bulk of our import require-
ments, but are unable to settle as formerly by selling ster-
ling in New York, neither can we ship gold, which is the only
accepted mediurn of settlement of balances between nations.
This for the good and sufficient reason that we have not the
gold to ship. The result is that there is competition in
Canada for New York funds, which must be purchased here
with Canadian money, and this competition has inceased the
price of the commodity, so that, at one time, the right to
receive $100 in New York, in funds current there, was worth
$117 in funds current in Canada. At the present time (Oc-
tober, 1920), the premium is 11 per cent.
Premium Goes to Canadian Sellers
The essential point to be kept in mind here is that
these funds are not purchased from the United States dealer,
but from a Canadian who owns the funds. It is he who gets
the premium from the Canadian purchaser. All the American
receives is the face amount of the invoice. For instance, a
Canadian dealer buys American goods to the value of $1,000
in the United States. The cost to him in Canada, with New
York funds at a premium of 11 per cent, will be $1,110,
but all the American seller receives is $1,000. He gets no
benefit from the premium, but the reverse, as it interferes
with his trade, making it harder for him to make the sale.
As our market for foreign exchange is in New York, this
premium must be allowed for in all transactions involving
payments abroad. In its final analysis, when we have a pay-
ment of, say, £1,000 to make in London, the transaction
simply is an exchange of commodities. Suppose sterling in
New York is quoted at 3.45 and New York funds here at
11 per cent, premium, the rate for sterling here would be
3.83. The Canadian would purchase, with $3,830, the right
to receive $3,450 in New York, and with this would buy the
right to receive £1,000 in London. Of course the transaction
would go through the Canadian bank, and the £1,000 draft
would be drawn on its London correspondent, but the bank
would have to buy sterling in New York to enable it to accom-
modate its customer.
For many years the Canadian system of quoting ster-
ling obscured this. Prior to confederation, the legal par of
exchange was at the rate of $4.44 4/9 to the pound sterling,
and when this ratio was changed to $4.86%, as it is to-day,
it was found that the new par was 9V2 per cent, premium
on the former. For some reason unknown at the present
time, the system of quoting sterling at a rate of premium
per cent, advance %r\ the rate of $4.44 4/9 was adopted, and,
in spite of its absurdity, resisted all efforts to change it.
When the war broke out the exchange market became de-
moralized, and the quotations outran the exchange tables in
use, so that dealers were forced to adopt a commonsense
method and quote in dollars and cents. In other words, they
had to mark the prices of their wares in plain figures.
Normal Adjustment Was Simple
In normal times, the adjustment of rates of exchange be-
tween countries was a comparatively easy matter, and the
course of exchange could be foretold, according to the season,
with fair accuracy, but since the war the exchange markets
have been thrown out of gear like everything else.
The balances between countries have become so huge that
settlement by shipment of gold is utterly impossible, and
the systems of adjustment formerly used quite inadequate.
Plans are being- made for the creation of large credits in the
United States, which is at present practically the only
creditor nation, and when these are effective the abnormal
exchange situation will correct itself in time.
Effect on Customs Rates
When foreign exchange is at a heavy premium, it oper-
ates as an increase in the customs tariff on imports. Ameri-
can exchange at a premium of 11 per cent., is equal to an
increase of 11 per cent, in the Canadian customs tariff on
American goods, and conversely sterling exchange, now
quoted at 3.84 in Canada, or a discount of 21 per cent., is
equal to a reduction in the Canadian tariff on British goods
to this extent. Until recently this was nullified by the cus-
toms authorities calculating the import duty on the par of
exchange, no matter what the depreciation of the foreign
currency. This absurdity was at last realized and partially
corrected, so far as importations from any country other
than the United States is concerned. American invoices are
valued at par and duty collected on that valuation, though
in reality the actual value here is greater by the amount of
the current premium on New York funds.
Much has been said as to the prospects of foreign trade
with Europe after the war, and it will be well to realize the
effect of exchange on the export of goods from Canada and
the United States, as the discount on foreign funds here will
naturally increase the price which the foreigner must pay
in his own currency for Canadian goods. Canadian exports
to Europe will, for this reason, be materially increased in
price to the foreign consumer. For instance, Ontario winter
wheat, worth, say, $2 at shipping points in Canada, which in
pre-war days would cost the British buyer 8s. IV^d. a bushel,
will, with sterling at a discount of 21 per cent., cost him
10s. 3d. a bushel. Sterling at a discount here means that in
Great Britain Canadian funds are at a premium and this
premium will have exactly the same effect on the prices of
Canadian goods in Britain that the premium on New York
funds in Canada has on the price of American goods here.
There are countries where British funds are at a premium or
at par, and this will impel the British consumer to buy from
those countries rather than from Canada.
Trade follows the line of least resistance always. The
old slogan that "trade followed the flag" was true, un-
doubtedly, in normal times, when the only barriers were
those deliberately raised by the various countries with the
avowed intention of turning trade into certain channels. The
war has, however, brought about entirely new conditions,
as evidenced by abnormal exchange rates everywhere, and
trade at present is adjusting itself to meet them.
New York Controls Canadian Rate
The main dealings of Canadians in exchange are with
the United States, Great Britain and France, and on the
Pacific Coast China and Japan, and with all of these we are
dependent on the New York exchange market for rates, as
that city is the exchange centre for this continent. Trade
in exchange, as in other commodities, follows the line of least
resistance, and, as New York is the market where exchange
can be most readily bought and sold, transactions naturally
are handled there. It is all a question of supply and demand.
The trade in exchange is of mutual benefit, just as is trade
in other commodities, and unless there is a mutual profit
there would be no trading. The essential part of trade is
that there shall be mutual consent.
Methods of Calculation
The methods of calculation in exchange are simple, if
the commodity idea is kept in mind, and the following ex-
amples will make it clear: —
Sterling Exchange
The par of sterling exchange is $4.86% to the pound.
At present prices, the pound is quoted at 3.45. The Canadian
rate will be the same, plus or minus the premium, or dis-
count, on New York funds in Canada. The premium is, say,
11. per cent., and the Canadian rate for sterling, therefore,
would be 3.45 plus 11. per cent, of itself, 3.45 + .37.95. or
January 7, 1921
THE MONETARY TIMES
American Baniv Note Company
17!).-,
CA >• A DI AX INC* >K I 'OK A TTON
1S!>7
HEAD office; AND WORKS
224 WELLINGTON STREET - - OTTAWA
FIREPROOF BUILDINGS
BRANCH OFFICES
TORONTO MONTREAL WINNIPEG
STEEL PLATE ENGRAVERS AND PRINTERS
CONTRACTORS TO THE GOVERNMENT OF CANADA FOR DOMINION NOTES,
POSTAGE AND REVENUE STAMPS. ENGflAVERS OF BANK NOTES FOR
THE CHARTERED BANKS OF CANADA. RAILVifAY, CORPORATION AND
COMPANY BONDS, MUNICIPAL DEBENTURES, STOCK CERTIFICATES,
LETTERS OF CREDIT, CHEQUES, DRAFTS AND OTHER SECURITIES.
WORK ACCEPTABLE ON ALL STOCK EXCHANGES.
70
THE MONETARY TIMES
Volume 66
0.8295. These calculations are usually based on £100 as a
matter of convenience in the ai-ithmetical work, thus: —
New York rate per £100 345.
Fremium on New York funds in Canada ll.'/t 37.95
382.95
£100 in Canada would be worth $382.95. The quotation is
always made on the single pound, therefore the quotation
would be .$3.8295 per pound.
The bulk of stei-ling transactions are by cable, or by
demand, or 60 days' sight bills, and in arriving at the rates
lor these interest on the demand rate is allowed for, and
for bills other than demand or three days' sight and under,
the stamp tax of Is. per £100, or fraction thereof, must be
calculated. In figuring the interest, the calculation is made
on the demand rate, with three days of grace on all items
drawn at any time over demand or sight. The year is taken
at 365 days.
Example:
If demand cheque rate is 3.45, what would be the rate
for 60 days' sight. New York funds in Canada, 11. per cent,
premium.
Premium on New York funds in Canada 11. ^r 37.95
New York demand cheque rate 345.
Deduct: 382.95
Stamp tax of Is. per pound. This is taken
as 1 20 of I'f 191
63 days' interest on 382.95 at the open mar-
ket rate in London, not Bank of England
rate, say 6%
382.95 X 6 X 63 3.991
365
4.182
Canadian rate, 3.7877. 378.768
This would be the basic rate, or let us say, the wholesale
price at which large blocks could be bought and sold be-
tween banks. If a bank wanted to make, say, M of 1 per
cent, on the transaction, this would be allowed for before the
rate was quoted to the customer, and would work out as
follows: —
Premium 37.95
New York demand rate 345.
Deduct: 382.95
Stamp 1/20 191
Interest 63 days at 6% 3.991
Vi profit 957
■ 5.149
Canadian rate, 3.778. 377.801
If the bank were selling the bills, the Vi per cent, profit
would be added to the rate as follows: —
Canadian basic demand rate 382.95
Stamps 191
Interest 3.991
4.182
H profit 957
3.225
Canadian rate, 3.797. 379.725
In normal times, rates for cables are simply the rates
for demand cheques, plus the interest on the estimated time
which would elapse before a remittance by demand draft
could reach London, this depending, of course, on the closing
and sailing of mails. Ten days was the time usually allotted
in such cases.
Example :
New York demand cheque rate 346.
Premium on New York funds 11.' > 38.06
384.06
Add:
10 days' interest at open market rate in
London, say 69c
Canadian cable rate, 3.847.
384.70
French Exchange
French exchange, or, as it is often termed, franc ex-
change, was formerly in New York and is still in London
quoted at so many francs and centimes per foreign unit,
pound or dollar. The efi'ect of this was that as the quota-
tion in francs rose the lower became the value of the franc.
At par the rate was 5.20 — i.e., 5 francs 20 centimes -to the
dollar. At this rate the franc was worth 19.3 cents. At
present (October, 1920) it is worth about 6V2 cents. New York
quotations until very recently were in francs per dollar, but
now are given, like all other exchange in that market, in
dollars and cents per foreign unit. It has been suggested
that the basis of quotation shall be 100 francs, and this may
possibly be adopted.
In Canada banks have usually quoted in cents per franc,
owing to the question of premium or discount on New York
funds as the premium or discount must be on the amount
of dollars to be paid, not on the francs purchased.
The method of calculating interest on franc exchange
diflrers from sterling in that there are 40 days of grace, and
the year is taken at 360 days as in New York. Formerly,
the interest was calculated on the par of exchange, 5.20
francs to the dollar, or 19.3 cents per franc, but now, as in
sterling, intei'est is calculated on the active quotation for
demand cheques.
The stamp duty on cheques is 10 centimes each, if pay-
able in the town where they are drawn, otherwise 20 cen-
times. At par this would' be 2 and 4 cents, respectively,
as the franc contains 100 centimes. The stamp duty on
cheques is not considered in exchange calculations. On bills
of exchange the stamp duty is 5 centimes per 100 francs, or
1/20 of 1 per cent. For quotation purposes, this is reckoned
on the quoted rate.
For instance, under the old system of francs per dollar,
the 60-day rate would be worked out as follows: —
Demand cheque rate 1540.
Add interest on 1208 60 days at
Bank of France rate, say, 7% ■ ■ 17.98
Stamp, 1/20 77
18.75
1558.75
The rate, therefore, would be 15.58% francs per dollar,
the calculations being made on the equivalent of $100 for
the sake of convenience.
In this case the interest and stamps would be added
in order to reduce the price, as a 60-day bill would be worth
less than a demand cheque by the amount of interest and
stamps.
Under the present method the rate for 60-day bills is
found as follows: —
Demand cheque rate 650.
Deduct:
Interest 60 days at 1'', 7.583
Stamps, 1/20 375
7.958
642.04
The rate would be 6.42 cents per franc.
To find the Canadian rate the premium on New York
funds would be added to the New York price, just ;'..• it is
with sterling. At the present time, however, the question
of 60 and 90 day rates for exchange of any kind is largely
academic, as, owing to the uncertainty of the exchange mar-
kets, practically all remittances abroad are by cable or de-
mand drafts.
i
January 7. 1921
THE MONETARY TIMER
Head Office Building, Montreal
BOARD OF DIRECTORS:
W. MOLSON MACPHERSON.
President
S. H. EWING. Vice-President
W. M. BIRKS. W. A. BLACK
J. M. MclNTYRE F. W. MOLSON
JOHN W. ROSS
EDWARD C. PRATT
General Manager
THE
MOLSONS
BANK
INCORPORATED 1855
Capital Paid Up $4,000,000 Reserve Fund $5,000,000
OVER 130 BRANCHES
IN CANADA
A General Banking
Business Transacted
Savings Bank Depart-
ments at all Branches
The Standard Bank
OF CANADA
Established 1873
Capital Authorized .... $ 5,000,000.00
Capital Paid-up 3,500,000.00
Reserve Fund and Undivided Profits 4,860.537.09
Total Assets . . . over 95,000,000.00
179 BRANCHES THROUGHOUT THE DOMINION
HEAD OFFICE
15 King Street West
TORONTO
C. H. EASSON.
General Ma
J. S. LOUDON.
Asst. Gen. Manage
Buy and Sell Foreign Exchange and Cable Transfers.
Issue Commercial and Travellers" Credits and Cheques, ne-
gotiable in all countries.
Make Collections in all the Provinces, United States, Europe
and the Orient at most favorable rates.
Assure prompt and efficient service.
Savings Bank Department at all Branches
Correspondence Invited
THE MONETARY TIMES
Volume 66
Publicity Methods in the Banking Field
Greater Attention to Advertising Reflects Keener Competition Among Banks —
Commercial Methods Utilized — Topical Booklets, Monthly Letters, House
Organs and Street Car Publicity Now Supplement Advertising in Press
By J. H. HODGINS.
Manager, Statistical Department, Union Bank of Canada, Toronto
MEASURABLE progress has been made since the war in
the development of bank publicity in this country along
more modern lines. In the evolution of newspaper effort, and
more specifically publicity and advertising, there is probably
no more interesting phase than that which concerns the atti-
tude of Canadian bankers.
For so long our bankers have been regarded as ultra-con-
servatives; for so long a bank "card" represented the consum-
mation of the banker's advertising expression. Our bankers
have been among the last of the advertisers seeking extension
of business to try out the effectiveness of the "human interest"
appeal. Tlie change has come in more or less subtle fashion,
but sufficient evidence of real "pep" has already been fur-
nished by Canadian bank advertisements and by various inter-
esting publicity-getting methods of the last year to indicate
that our bankers have followed the trend of the times.
AA'ar Effort Pointed the Way
The greatest achievement of modern publicity has been
the development and propagation of ideas. Out of the neces-
sities of the war period came the need for vast public borrow-
ing by governments; thrift and production had to be engen-
dered. How was all this accomplished? By propaganda
advertising. We have but to look back to be more fully im-
pressed with the gigantic effort that was pushed through to
previously undreamed-of successes through the sheer force of
publicity and advertising. As an immediate result all adver-
tising effort has taken on an added dignity, an increased
value.
It has been demonstrated that bank advertising may
remain dignified and yet have a "punch" to it. Similarly, no
individual, however grand, sacrifices his "dignity" because he
• smiles. You are not attracted by a gloomy advertisement but
rather to the one that i-adiates cheer. Aftei- all, why should a
bank advertisement be more stereotyped in its form than any
form of advertisement?
Canada's war loan experiences were the same as Eng-
land's. Our finance minister had to "sacrifice dignity" and
get dovm to the level of the masses through the popular
phases of publicity. A million dollars in cold figures had first
to be "interpreted" in tei-ms of bullets before the man on the
street caught the real significance of the country's great
need.
Linked With Agriculture
It is given to our banks in their advertising to be con-
structive, nationally. A great deal may be accomplished to-
ward further driving home the truths of national propaganda,
as witnesseth the campaigns carried on by many American
financial institutions during the war period, when thrift was
paramount, when food conservation was vital. Here in Can-
ada — ■ where the bond between banker and farmer must neces-
sarily be intimate because the country's basic industry is that
of the soil — our banks may accomplish much from the agri-
cultural viewpoint. On more pi-ogressive lines the banks' cam-
paigns may be directed toward greater production where lower
yields threaten, be it in wheat crop or cattle herds. Our
banks actually have furnished the financial energy necessai-y
in the growth, transportation and marketing of Canada's vast
crops, but our bankers are only now awakening to the need
for educating the agriculturists of Canada to a fuller appreci-
ation of the gigantic task which the banks perform for the
Canadian farmer from year to year.
Likewise it is given to the banks to direct public thought
along the lines of constructive spending.
Bankers are coming to regard advertising and publicity
along broad lines. More recent bank advertising in this coun-
try has done much to broaden the public's vision of interna-
tional trade, a factor to which the average Canadian directed
but scant thought before the pressure of war production ad-
vanced our industrial plant to its present proportions — - and
has thus enlightened the average citizen as to the future.
Undeniably banking is becoming more and more competi-
tive in Canada. There are only eighteen chartered banking
institutions, but these eighteen banks have some 4,800 branches
thi'oughout the Dominion, and each and every branch manager
knows full well the keen race for business which he must run
against competitive managers. The I'esult is a very consider-
ably stimulated publicity programme.
New York Agencies Take Lead
Probably some of the most progressive methods of pub-
licity which our bankers have employed have been undertaken
by the New York agencies of Canadian banks in their effort
to make Canada better known throughout the United States.
The Union Bank of Canada early initiated an educational cam-
paign, through the issuance of two booklets, "Canada and Its
Potentialities," and a little later, "Trade Acceptances: Cana-
dian Practise," which was a treatise timed when the trade
acceptance was being introduced into the American banking
system. This subtle form of Canadian propaganda was fur-
ther supplemented by advertisements designed to sti-ess Can-
ada's rich resources. Closely allied with this publicity, direct-
ly in the interests of Canada and indirectly, of course, in the
interests of the advertising bank, was that undertaken by the
Canadian Bank of Commerce and by the Dominion Bank,
which further served to draw attention by picture and by
word message to our provinces and our cities. The Royal
Bank of Canada during the year issued for New York distri-
bution a booklet of Canadian statistics, and the Bank of Mont-
real, in a pamphlet, informed the American investing public
regarding Canada's war loans.
The Topical Booklet
The topical booklet has come to be a dominant factor in
financial advertising, and our bankers liave been quick to ric-
ognize it as a potential direct medium. The foremost banking
institutions of the United States within the last few years
have made extensive use of the booklet as part of their pub-
licity programmes, and their continued efforts in this direction
indicate clearly their satisfaction.
More recently the Union Bank of Canada, as part of a
campaign to attract American manufacturers to the Dominion
has brought out a booklet, "A Canadian Plant — Why?" the
title of which is significant of its plea. The vagaries of the
foreign exchange situation have recently been clearly ex-
plained to the layman by the Canadian Bank of Commerce's
iDOoklet and by "Protecting Your Canadian Customer," a book-
let of the New York agency of the Union Bank of Canada
which was primarily ^\^■itten for the education of the Ameri-
can exporter to Canada. The Bank of Montreal has issued
"The British West Indies and British Guiana," which, after
all, is propaganda in attractive form, and of pertinent interest
to Canadian business men was the Union Bank of Canada's
booklet upon "The Canadian Stamp Tax," meeting immedi-
ately the needs of a like situation created by the income taxes
to which several Canadian financial institutions catered with
carefully indexed booklets citing the law for the average
reader. In publishing these and similar booklets our bankers
unquestionably are furthering the public service of our banks
Januaiy
THE MONETARY TIMES
(Eompaiig of Qlanaba, HtmttPii
HAMILTON, ONTARIO
Paid-Up Capital, $500,000
Reserve, $125,000
Executor, Trustee
Administrator, Etc.
The Company will act as Agent for Executors
or Trustees who desire to be relieved
of the Management of Estates.
All Business under direct supervision
of the Executive Committee
BOARD OF DIRECTORS :
Cyrus A. Birge, President
Col. H. L. Roberts and James Turnbull,
Vice-Presidents
T. C. Haslett, K.C, Chairman Executive Committee
C. C. Dalton, A. E. Dyment, J. J. Greene,
Sir Jolin S. Hendrie, K.C.M.G., J. F. Kavanagh,
Col. John r. McLaren, Lt.-Col. W. H. Merritt,
Maj.-Gen. Hon. S. C. Mewburn, Stanley Mills,
C. S. Wilcox, W. A. Wood.
S. C. Macdonald, Manager
A Trust Company organized and equipped
for service to you and your family.
Incorporated by Special Act of Parliament
ol the Dominion of Canada.
Auihorize^t to act in all Trust Capacities.
Prudential Trust Company
LIMITED
Capital Stock Authorized, $1,500,000
Subscribed, $1,000,000 Paid up, $609,611
Reserve Account, $100,464.27
Real -Estate & Insurance Departments
B. HAL BROWN, President and General Manager
J. P. SPEEDIVIAN, Vice-President
Head Office
MONTREAL
Toronto Branch— Union Bank Building
Cor. King and Bay Streets.
Other Branches —
Winnipeg Edmonton
Regina Vancouver
London, England
St. John
Halifax
THE SASKATCHEWAN MORTGAGE AND
TRUST CORPORATION, LIMITED
Paid-Up Capital and Reserve -
$950,000
The oldest and largest Trust Company in Saskatchewan. Real Property Managed.
Estates Administered. Acts as Agent lor Executors and Trustees who
desire to be relieved of the management of Estates.
Money invested for Clients on Agency or Guaranteed Plan. Acts as Trustee under
Bond Issue.
INCORPORATED BY SPECIAL ACT. A.D. 1909
Executor Administrator Liquidator Trustee Guardian Etc.
DIRECTORS :
A. E. WHITMORE. Vice-President
A. W. MacGREGOR S. C. BURTON
HON. A. P. McNAB R. M. JOHNSTON
A. G. RAWLINSON
R. A. KIRKWOOD, Secretary
J. F. BOLE, President
F. N. DARKE
MAJOR F. J. JAMES
JOHN F. REID
C. V. SMITH, Manager
102 Darke Block - Regina, Saskatchewan
74
THE MONETARY TIMES
Volume 66
■ — in an educational way — while seizing the opportunity for
publicity of the kind that makes a real appeal to the public.
The Illustrated Advertisement
The illustrated bank advertisement is probably the latest
development in this country. As far as I am aware, the Union
Hank of Canada's "Park-Union" series was the first among
Canadian bank advertisements to be seriously treated by an
artist. These advertisements, primarily designed to empha-
size the extended international services offered through this
unique organization, were made attractive with "local atmos-
phere." As an example: The advertisement which told of the
bank's London (England) connections was illustrated with a
picture of busy Threadneedle Street and the Bank of England
as a background. Since, the Canadian Bank of Commorc;
has issued several attractively illustrated advertisements, and
the Bank of Montreal, long regarded as ultra-conservative in
its advertising, brought out a new series with sketches of the
bank's head office.
The serious illustrating of bank advertising is not a cas-
ual development. Rather it represents a conviction among
professional advertising men who have studied their publics
that a picture drives home its message even more quickly than
the printed word. Probably, too, the influence of the Victory
Bond posters has been carried into our bank advertising.
Coming Down 'o Public
Canadian. bankers of late hava indeed branched into hith-
erto imexploited fields of publicity. The silk-hatted banker
of the old school would be shocked iio doubt to see ban'^t adver-
tising beckoning, cheerily, at him from the street cars — driv.
ing home a message of thrift and saving to the average indi-
vidual of the community. Our banks are now advertising in
the street cars of almost all our Canadian cities. Some bank-
ers there are who have come to recognize electric signs and
the "movies," but comparatively few may be said to bo "soiu"
for advertising other than that appearing in the newspapers,
trade journals and well-recognized magazines. In other
words, the press is still the most completely accepted medium
for bank publicity.
The Canadian Bank of Commerce, the Royal Bank of Can-
ada and the Merchants Bank of Canada, as outstanding exam-
ples, have come to regard the monthly commercial letter as a
potent factor of publicity. The commercial letter may be
said to be a consistent supplement to the topical booklet.
The House Organ
Not all bank publicity is being done publicly, however.
The house organ is being adopted within several of our bank-
ing organizations. Already the Sterling Bank, the Home Bank, .
the Union Bank of Canada, the Canadian Bank of Commerce,
the Royal Bank and the Dominion Bank are publishing-
monthly magazines solely in the interest of their staffs. The
mission of the bank organ primarily is to develop an espint
de corps or a staff loyalty, but there is no gainsaying its
measure of publicity even if only within the bank's own
organization.
From the "exterior" or public viewpoint the coming of
the bank organ should not lightly be dismissed. The bank
organ unquestionably will accomplish much toward further
improving the public service rendered by our banking institu-
tions. As a literary contribution to our banking history it
will no doubt exert its influence in due season, while at the
same time offering an interesting contribution to the art of
printing and to the trade of publishing.
A bank organ is particularly desirable for a Canadian
bank under the Canadian system of branch banks. By this
medium the bank's representatives at the frontier posts — ■
and there are still many in this wide-flung Dominion — may
be kept in intimate touch with the passing events of the home
office. The bank organ may be made to fill much the same
purpose of the small community weekly whose item of news,
"Bill Smith has shingled his barn this week," is of more vital
concern to the home-town boy far removed from his native
hearth than events duly chronicled in display headings on the
front pages of the metropolitan dailies.
Canadian bankers clearly have reached a finer and a
keener appreciation of the arts and subtle influences of pub-
licity and advertising. All that remains is a fuller realization
of the fact that bank advertising to be completely effective
must become increasingly "popular," for the average man or
woman is the individual whom the banks would reach to-day.
GOLD AND DOMINION NOTE HOLDINGS LOWER
Since the beginning of 1918 the holdings of gold and
subsidiary coin of the banks in Canada have decreased to
quite a large extent. In January of the year mentioned
these holdings totalled §95,785,084, reaching that point, which
is the high record, after increasing during the years previous.
Since then, outside of slight fluctuations, there has been a
continued downward movement which reached the bottom in
December, 1919, when the figure was $84,213,438. There has
been a slight improvement during the- past year, but not of
much account.
The decline in these holdings has also been accompanied
by a similar movement in holdings of Dominion notes, com-
mencing in December, 1918. From that date the movement
continued downward until October, 1919, when it started up-
ward. The climax was soon reached, however, and in April,
1920, the trend was again downward, and this time more pro-
nounced.
Although it would seem from this that the cash position
of the banks has become weaker, such is not the case. Call
loans in New York, which are considered equivalent to cash,
have increased to such an extent that the decline in gold and
note holdings is more than offset, and to quite a considerable
sum. Call loans in New York at the beginning of 1918
amounted to $132,687,066, while according to the latest bank
statement the figure is now $188,367,459. It is more profit-
able for the banks to keep substantial amounts on call in
New York, when they are not only available within twenty-
four hours as cash but are also drawing interest.
The following table shows the average amount of hold-
ings of gold, subsidiary coin and notes, each month since
January, 1918: —
Gold and Dominion
1918 — Subsidiary coin Notes
January $95,785,084 $195,927,684
February 94,366,989 192,207,106
March 93,181,192 182,330,656
April 93,013,608 179,705,307
May 88,667,684 189,025,969
June 85,815,276 199,932,537
July 85,933,634 204,179,801
August 85,808,338 207,814,241
September _- 86,476,973 210,088,479
October 86,117,756 205,.332,680
November 87,200,769 214,022,846
December 87,884,146 208,019,191
1919 —
January $86,168,445 $197,739,973
February 85,725,951 191,441,588
March 86,098,447 181,102,320
April 84,953,140 174,131,071
May 84,809,908 177,456,695
June 85,656,571 171,392,969
July 86,236,599 176,544,418
August 86,079,703 177,327,436
September 87,170,499 168,260,462
October 86,492,301 166,437,341
November 86,517,911 172,997,904
December 84,213,438 172,690,695
1920 —
January $86,641,270 $177,501,154
February 87,668,936 177,099,303
March 87,396,939 182,212,025
April 88,865,085 170,320,595
May 86,487,324 170,012,109
June 86,460,864 166,192,824
July 87,471,926 164,680,676
August 86,332,046 172,509,202
September 86,944,667 172,047,610
October 86,211,873 173,008,938
January 7, 1!»21
THE MONETARY TIMES
Canadian Financiers Trust Company
INCORPORATED 1907
Government, Municipal and Corporation Bonds
To Yield 5.90% to 7!%
For Investment
We have a very complete list. Before investing secure particulars of our offerings.
Commutiicate ivifh us for all Trust Agency
and Investment Business in British Columbia
HEAD OFFICE
VANCOUVER, B.C.
General Manager: LIEUT.-COL. G. H. DORRELL.
The
Montreal City and District
Savings Bank
Head Office and Sixteen Branches
in Montreal.
A. P. LESPERANCE
General Manager
T. TAGGART SMYTH
Assistant General Manager
Executors & Administrators
Trust Company
Authorized Capital
$1,000,000
HEAD OFFICE:
10 Central Chambers
MOOSE JAW - SASK.
Authorized to act as
Executor, Administrator and Assignee
BOARD OF DIRECTORS:
A. W. Irwin, President; J. H. Wellington, First Vice-
President; R. H. Clark, Second Vice-President.
Wm. Grayson, K.C., W. F. Dunn, L. M. Rosevear,
A. R. Bie, H. F. Stirk, J. W. Sifton.
W. A. MUNNS, Manager.
(Official administrators for the Judicial District of
Moose Jaw, Sask.)
THE MONETARY TIMES
Volume 66
Bank Circulation Higher Than in 1919
More Notes Outstanding at End of Each Month Than for Corresponding
Months in 1919 — Maximum is Reached in November and Minimum in
Early Summer — The Security for Bank Notes and the Service Rendered
UNDER the Bank Act banks are authorized to issue notes of
the denomination of $5 and multiples of $5 up to the
amount of their paid-up capital. They are also permitted to
issue in excess of the capital by depositing in the Central
Gold Reserve an amount equal to such excess in gold or Do-
minion notes. In addition each bank may, during the crop-
moving period, from September 1 to April 30, inclusive, issue
up to 15 per cent, of its combined capital and rest, and on
this excess interest must be paid the government at the rate of
5 per cent, per annum by way of tax. As a war measure this
excess was authorized by the Finance Act of 1914, during the
balance of the year, but this has not been availed of to any
extent for the last year or two, the banks preferring to use
the gold reserve.
The Finance Act of 1914 also authorized advances by the
government to the banks, by the issue of Dominion notes
against approved securities. The bank statement issued
monthly by the government does not show to what extent this
has been availed of. Just why this information should not be
given is not apparent, as in making advances in this way the
government is merely performing the same service to the Can-
adian banks and public that the Federal Reserve Banks in the
United States were organized to do in that country.
Effect of High Prices
The high prices of commodities, due to the inflation
through war conditions, made an increase of circulating me-
dium imperative, and this W0,s the safest and most conserva-
tive plan of providing a fully-secured currency. When prices
fall, as appears probable, the currency will reduce accordingly,
thanks to the system of daily redemption of bank notes, which
is one of the outstanding features of our Canadian system of
banking.
This system by which each bank daily sends in for re-
demption through the clearings all notes of other banks re-
ceived in the course of business is the chief method by which
the elasticity of currency throughout the country is preserved.
Under it the circulation outstanding is only that amount
required for the actual business needs of the community, any
excess being promptly retired in the ordinary course of daily
business.
Large Increase in 1920
During 1920 bank circulation, as shown by the compara-
tive table below, has greatly increased in volume over the pre-
vious years:
Monthly Average Highest point
In 1917 $190,000,000 $196,000,000
In 1918 200,000,000 2.34,000,000
In 1919 235,000,000 237,000,000
'\^^ile the figures for December are not yet available, the
average for the year 1920 will be about $20,000,000 more than
the year preceding. In the past the highest point each year
has been in November, and for the year 1920 the same result
can be looked for.
Security for the Notes
The bank circulation is frankly an asset circulation, the
notes being a first charge on the bank's assets. On this basis
it will be interesting to know the security behind the issues.
Under the section of the act requiring a deposit of a i-edemp-
tion fund equal to 5 per cent, of each bank's circulation, the
effect is to make the banks as a whole responsible for the
circulation of any one bank. For this reason the charter of
the Canadian Bankers' Association gives the officials of that
organization authority to inspect the records of issue of each
chartered bank, in order to prevent an over-issue of circula-
tion. So far as the banks are concerned their issues have
been handled in a most consei-vative way, anything in excess
of the paid-up capital being covered by deposits in the gold
reserve.
The total circulation outstanding on August 31 was $227,-
378,864; of this $103,162,533 was covered by the deposit in the
gold reserve which offsets the liability of the banks to that
extent, leaving in round figures $124,000,000. At the same
date the banks held gold coin in their vaults amounting to
$879,954,831, or 64 per cent, of their issue not covered by the
deposit in the gold reserve.
The total assets of the banks, less the gold reserve which
specifically secures part of the issues, amounted on the same
date to $2,968,017,294. The notes are a first charge against
these assets, so that for each dollar of circulation outstanding
there are $24 of assets for the security of the public.
What Return Is Given?
The circulation privilege of the banks is sometimes criti-
cized on the ground that the banks give no adequate return.
Without circulation, however, the banks' power to extend
credit would be greatly reduced, and the usefulness of the
branch system decidedly impaired.
As the notes are not currency until issued it is possible
for the branches to carry their funds in this form without
expense. Owing to public confidence in the security behind
them these notes pass as money in the ordinary course of
business, and outside of silver for change the branches there-
fore require no specie, and the reserves of gold and Dominion
notes are kept intact in the main offices, where they are read-
ily available when wanted. The use of the notes is merely
an extension of the credit system by which all business is car-
ried on.
There is another feature of banking in this connection
which is not fully appreciated. This is the amount in transit.
Cheques and notes of other banks are received daily and cred-
ited to depositors. The bank does not receive actual payment
for these until the following day, and it therefoi-e constitutes
an advance until payment is actually received. It is in effect
a continuous free advance to the public. To il'ustrate: The
circulation outstanding on August 30 last, less the amount
covered by deposit in the gold reserve, was $124,000,000.
Against this $30,000,000 of cash reserves is applicable, leav-
ing the loanable balance $94,000,000. On the same date the
banks held in cheques and notes of other banks, credited to
depositors but which the banks had not yet received settle-
ment for, $158,540,830, which far more than offsets the loan-
able fund derived from the circulation.
The following table shows the totals of the bank circula-
tion by months for the last four years. The rise and fall
during the year indicates the course of business demand, while
the steady increase year by year shows tlie result of the
steadily rising price of commodities, which has been chiefly
responsible for the increase in the current medium of ex-
change.
Circulation by Months
The amount of notes outstanding at the end of each
month for the past three years, as shown by the banks' state-
ments to the department of finance, have been as follows:
1918 1919 1920
January . $171,674,464 $203,424,472 $216,691,916
February 176,369,296 204,779,750 223,377,781
March 191,058,404 214,576,070 225,769,628
April 180,654,964 208,958.572 223,387,731
May 181,889,959 215,895,050 226,335,037
June 194,681,710 217,608,195 227,775,253
July 187,865,833 206,906,941 231,534,233
August 200,839,660 222,461,915 227,373,864
September 211,623,856 225,907,997 231,094,885
October 227,597,808 236,477,479 249,165,707
November 234,982,978 237,547,162
December 224,501,117 232,486,734
January 7. lOiil
THE MONETARY TIMES
77
The
Yorkshire & Canadian
Trust, Limited
Established 1889 in Vancouver
A General Trust Company Business Transacted.
TRUSTEE
EXECUTOR
ADMINISTRATOR
LIQUIDATOR
ESTATES MANAGED
INSURANCE EFFECTED
BONDS BOUGHT AND SOLD
REAL ESTATE AGENT
YORKSHIRE BUILDING, VANCOUVER. B.C.
General Manager H. W. DYSON
British Canadian Trust
Company
Head Office — Conybearc Block
LETHBRIDGE, ALBERTA.
Inc(1ki'oraTkii bv Special Ordinanck oi; thI'
NoKTHwKsT Territories of Canada.
(1901 Chapter 35.)
Authorised to act as
EXECUTOR, ADMINISTRATOR,
TRUSTEE, GUARDIAN.
Genera/ Financial Agents.
V. p. CONYBKARK
President
GEO. H. STAGEY
Vice-President
(IKO W.M. PARSONS
Manager
Authorized Trustee under Dominion
Bankruptcy Act.
Taylor Safes
STAND THE TEST
They have been considered the
standard of excellence for 65 years.
One Quality
One Price
J. & J. TAYLOR, Limited
Toronto Safe Works
Toronto
Branches . MONTREAL WINNIPEG VANCOUVER
THE MONETARY TIMES
Volume 66
Four Legal Decisions Affecting Trust Companies
Canadian Shareholder Held Liable For Double Liability Provision in Minnesota
— Interpretation of Will in Nova Scotia — Executors Held Personally Liable in
Alberta Case — Charitable Bequest Need Not Be Spent in New Brunswick
OF the cases before the Canadian Courts during the past
year, dealing' with matters of interest to trust companies,
four have been selected for consideration in this review as be-
ing of special interest. The first case to be considered is that
of Allen vs. Standard Trust Company, in which Justice Gait
decided that the estate of a British subject who had bought
and received shares in an American company was liable under
the double liability clause which it was claimed obtained in the
case.
The relief claimed was $5,000, being the par value of
50 preferred shares of the O. W. Kerr Co., held by the late Sir
William Whyte. The plaintiff Allen sued as the receiver of
the 0. W. Kerr Company, which is a foreign company, incor-
porated in the state of Minnesota, head office in Minneapolis,
and doing business as vendors and purchasers of real estate;
the Standard Trust Company is the executor of Sir William
Whyte's estate. The basis of the plaintiff's claim consisted
in a double liability alleged to attach in favor of creditors to
every share of stock issued by a corporation which has become
insolvent.
The present case was argued by the defendants mainly on
the ground that the plaintiff was seeking to enforce against
the defendant a personal judgment obtained in Minnesota
.against the late Sir William Wliyte, a non-resident, and with-
out notice. But the action was not upon any personal judg-
ment, nor were the appointment of the receiver nor the assess-
ment levied on shareholders carried on without notice, for the
manager of the defendant company produced papers showing:
(1) That notice of a special meeting of the Kerr Company to
consider its financial difficulties was sent to Sir William
Whyte; (2) the receipt of a copy of an order from a Minne-
sota court regarding the appointment of a receiver for the
company; (3) that a copy of an order made by the Minnesota
court in regard to the enfoixement of double liability on the
shares in question was received. Thus notice of all proceed-
ings was given Sir William Whyte.
Minnesota Law to Govern
In regard to the double liability question the court is
quoted as follows: "The liability sought to be enforced against
the estate of the late Sir William Whyte is a constitutional
liability expressed in the statutes as follows: 'Each stock-
holder in any corporation, excepting those organized for the
purpose of carrying on any kind of manufacturing or mechanical
business, shall be liable to the amount of stock held or owned
by him.' The constx-uction placed upon this provision by the
Supreme Court of the United States, and now applied by the
courts in Minnesota, is that it is a provision intended to pro-
tect the creditors of companies, and that it imposes on all
shareholders a liability over and above any balance remaining
due upon their shares to the full extent of the par value of
their shares. It operates as a double liability."
Mr. Justice Gait sums up his decision in six statements,
the most important of which are, briefly: (1) That the O. W.
Kerr Co. was duly incorporated in Minnesota. (2) That Sir
William Wliyte bought 50 preferred shares of the company and
received dividends thereon. (3) That Sir William Whyte was a
British subject and a non-resident of Minnesota, and he pur-
chased the shares in Winnipeg; but, in my opinion, the proper
law of contract in question, in so far as the rights and liabili-
ties of the late Sir William Whyte are concerned, is the law
of Minnesota. (4) Finally, I find that when Sir William
Whyte became a shareholder of the O. W. Kerr Co. in
the "year 1911, he agreed by implication that his rights, liabili-
ties "and status as a shareholder in that company should be
governed by the laws of Minnesota, and that under these laws
the defendant company, as executors of the estate of Sir
William Whvte. are now liable for the relief claimed, to-
gether with interest at six per cent., in accordance with the
law of Minnesota."
Mills vs. Biden
In the next case it was held by the Nova Scotia Supreme
Court that it is the intention of the testator which must be con-
sidered, whatever the wording of the will may be. The case
was that of Mills vs. Biden, and the part of the will in ques-
tion was that making a bequest to his wife, reading as fol-
lows: "All my real and personal estate of which I shall die
seized and possessed, or to which I shall be entitled, and all
debts which may be due to me at the time of my decease, with
full power and authority for her to dispose of the same at her
discretion by absolute deed or deeds of conveyance executed by
her, or by her last will and testament among my children, or
any one of them; and should she die without executing such
deed or deeds or last will and testament, then the same to be
divided among my children surviving, or their legal represen-
tatives if dead, share and share alike."
After the death of W. N. Mills the widow seems to have
thought she was the absolute owner of the real estate and
accordingly made a deed of a portion of it to one William
Hamilton, who by himself or his grantees, conveyed to one
Briden, the defendant. The widow of W. N. Mills died on
March 12th, 1902, without having disposed of the property by
deed or will among the children of the deceased, and the action
was brought to recover possession of the land so sold to Ham-
ilton and subsequently transferred to Biden.
Intention Was Children Should Benefit
The main contention was as to whether the will of W. N.
Mills on the true construction to be put on it gave his widow
absolute ownership or only possession for the duration of her
own life in the real estate. If she took it in absolute owner-
ship, then it is admitted that her deed to Hamilton and the
subsequent deeds vested a good title in Biden. On the other
hand, if the will only gave the widow a life estate in the real
estate of the deceased, it would seem to follow that she could
convey a life estate only.
Chief Justice Harris decides the question in the following
words: "His intention that his children should benefit is per-
fectly obvious, as is also his intention that they should at least
take on the death of his wife. They are to take before her
death if she, in her discretion, should so decide, and should
convey it to them otherwise on her death, either by her will in
their favor or otherwise under the testator's will equally. I
do not see how a plainer intention to benefit the childi'en could
have been manifested."
Security Trust vs. Wishart
The third case is that of Security Trust Company vs.
Wishart, in which the Supreme Court of Alberta held that
executors are personally liable on their contracts so long as they
have no relation to some obligation of the testator. The facts
were that the company obtained $15,000 for services rendered
Mrs. Wishart and William Breckenridge, two of the executors
of the will of the late John Breckenridge. The two executors
had made an agreement with the trust company whereby the
company was to act as their attorney and agent whenever
they might be absent from the jurisdiction. The agreement
then witnessed that the trust conipany was to receive $250 per
month for its services, and that some question might arise
later as to what extent such compensation might be chargeable
against the estate. A later clause then set forth that in the
event of Mrs. Wishart not receiving $300,000 and her daugh-
ter $75,000, or any legacies being diminished by reason of pay-
ments to the trust company, Mrs. Wishart was to be "person-
ally liable for such proportion or amount of the said trust com-
January 7, 1921
THE MONETARY TIMES
THE IMPERIAL CANADIAN
TRUST COMPANY
HEAD OFFICE, WINNIPEG, CANADA
Incorporated by Special Act of the Legislature of Manitoba.
Licensed under tlie Laws of the Provinces of Saskatchewan, Alberta and British Columbia.
AUTHORIZED CAPITAL
SUBSCRIBED CAPITAL
PAID UP CAPITAL AND RESERVE
TOTAL ASSETS
$3,000,000
1,171,700
1,172,348
7,266,797
DIRECTORS
Major D. E. vSprague. O.B.E., J. H. G. Russell, Esq., W. T. Alexander, Esq., Dr. A. D. Carscallen,
W.J Boyd, Esq., E. L. Taylor, Esq., K.C., F. H. Alexander, Esq., Col. The Hon.
A, C. Rutherford, James Short, Esq., K.C., S. D. Lazier, Esq ,
R. T. Elliott, Esq.. K.C., Thos. S. McPherson, Esq.
C.eneral Manager: \V. T. ALEXAN'DER. Esq. Asst. General Manager. M.AJOR F R GEORGE
Authorized to act as
EXECUTOR, TRl STEi:, ADMINISTRATOR, GIARDIAN, RECEI\'ER, ASSIGNEE
GENERAL FINANCIAL AGENTS
Branches at VANCOUVER. VICTORIA. CALGARY. EDMONTON, REGINA. SASKATOON
Canadian Guaranty
Trust Company
HEAD OFFICE
BRANDON, MAN.
Acts as Executor, Administrator, Trustee.
Guardian, Committee, Assignee, Receiver,
etc.
Moneys Invested for clients in First Mort-
gages on improved farms only to yield
6 ; to 7 :.
5' '., allowed on sums of $500.00 or upwards
in moneys left for tliree years or longer under
our Guaranteed Trust Investment Receipts.
Our Agency Department is fully organized
for tlie management of properties, collection
of rents, accounts, etc., and the buying and
selling of Real Estate.
Of ficial Administrator ior the Northern and
Dauphin Judicial Districts in the Province
of Manitoba.
Branch Office:
Swift Current, Sask.
Saskatchewan General
Trusts Corporation
Limited
.AUTHORIZED TO ACT AS
Executor, Administrator,
Trustee under Bankruptcy Act
Acts as Agent for making Investments
in First Mortgages and other First Class
Securities
BOARD OF DIRECTORS:
W. T. .MoLLARD, President G. H. Barr. K C. Vice-President
J. A. McBride C H. Willoughby W. H. Duncan
J. A. M. Patrick, K.C. David Low, M.I). \Vm. Wilson
A. L. Gordon. K.C. Herbert E Sumnson, K.C.
General Manager E. E. Murphy
HEAD OFFICE
1811 CORNWALL STREET
REGINA, SASK.
(Official adniinstrator for the judicial district
of Wevburn, Sask )
THE MONETARY TIMES
Volume 66
pany's remuneration as may be disallowed by the court on
the passing of the accounts of the said estate," provided that
if William Breckcnridge received more than $5,000, "he shall
to the extent of such excess contribute in equal shares with
the said Irene Breckcnridge (Mrs. Wishart) to such remuner-
ation of the said trust company as may, on the passing of the
executors' accounts, be disallowed by the courts."
This agreement was signed by the above two executors,
but not by the third. The will of John Breckcnridge provided
that William Brcckenridge and Mrs. Wishart would be amply
compensated for their services by the legacies they would
receive, and that the third executor who was to look after
much of the detail was to receive $250 per month, which he has
received. At first it was thought that there would be a sur-
plus, but it later developed that there was hardly sufficient to
pay the debts in full.
His Lordship's decision is, briefly:
"The parties all thought the estate was not only solvent
but very rich. Hence the idea of much personal liability was
not very prominently in their minds. Mr. Wishart agreed
that what she had indemnified William Breckenridge against
would come out of her share of the estate. They were really
all thinking that everything would come eventually out of the
estate or someone's very large legacy from it.
"I therefore think that we ought not to discover any im-
plied undertaking of the plaintiff to look to the estate and the
estate alone for the major portion of its remuneration.
"My point is that there never was any possibility of the
plaintiff company being able to sue' the estate in an action for
their services. Even if the reference to 'personal' liability
which is found in the agreement had never been there at all,
and even if Roach had signed, and although they were all de-
scribed as executors, the plaintiff company could have sued
executors personally, and them alone, for their agreed remu-
neration.
"There is nothing in the agreement specifically relieving
the two signing executors from their ordinary personal liabil-
ity, covering the whole amount agreed to be paid — the uncer-
tain amount left after a fixed remuneration had been decided
on for the two executors as well as the amount which might
be allowed to them — i. e., the executors, as such remunera-
tion. And I think, therefore, the ordinary rule of full per-
sonal liability should apply.
"The appeal should be allowed with costs and judgment
entered for the plaintiffs against the defendants Wishart and
Breckenridge for $15,000."
New Brunswick Succession Duty
In the fourth and last case to be considered the question
came up as to the application of the New Brunswick Succes-
sion Duty Act to certain charitable bequests made in a certain
will.
The case arose out of an action commenced by the provin-
cial secretary of New Brunswick' against C. W. Robinson and
A. E. Bartlett as executors and trustees of the last will and
testament of one A. R. McClelan. The aggregate value of the
estate of A. R. McClelan is $205,602, of which $152,999 was a
charitable bequest to be administered by the above named trus-
tees, Robinson and Bartlett. The residuary clause of the will
which directed the application of this charitable bequest is: "I
give and bequeath all the residuary estate to my executors and
trustees in trust to manage, to call in, collect and convert the
same into money and deposit the same at interest in a char-
tered bank or banks and use and employ the money so depos-
ited from time to time and all interest therefrom arising for
the benefit, advantage, assistance or the founding of such
charitable, religious, educational or sanitary institutions as my
said executors and trustees may from time to time see fit and
deem desirable."
The questions upon which the court was asked to give an
opinion were: (a) Is the plaintiff entitled to succession duty
under The Succession Duty Act, 1915, in respect of all moneys
passing to the said Clifford W. Robinson and Abner E. Bart-
lett, as trustees under the residuary clause in the will of the
said Abner R. McClelan, deceased? (b) At what rate is suc-
cession duty to be computed? (c) Is the plaintiff entitled to
interest on such succession duty as claimed ?
The judge in his answer to the questions stated that as
regards the first question the answer depended on the con-
struction and meaning to be placed on section 6, sub-section
2, of chapter 27, of the Succession Duty Act, which reads as
follows: "No duty shall be computed in reference to (2) any
pi'operty given, devised or bequeathed for religious, charitable
or educational purposes to be carried out in New Brunswick,
nor the amount of any unpaid subscription for any like pur-
pose, made by any person mentioned in this sub-section for
which his estate is liable."
Need Not Be in New Brunswick
In answer to the first question His Lordship said: "I base
my judgment upon the fact that upon a true construction of
the will there is no obligation on the part of the trustees to
carry out the intention of the testator in this province, and
that the bequest is not a bequest to be carried out in New
Brunswick. To bring the case within the statute the legacy
must be given to be carried out in New Brunswick, and there
must be a clear intention manifest upon the face of the will
that the purpose is to be effectuated here. In the language
of Palles, C. B., mutatis mutandis it is not sufficient that an
application of money in New Brunswick would satisfy the be-
quest. In my opinion, therefore, the answer to the first ques-
tion must be yes, or in other words that the plaintiff is en-
titled to succession duty under the Succession Duty Act, 1915,
in respect of all money passing to the said C. W. Robinson
and A. E. Bartlett as trustees under the residuary clause in
the will of the said A. R. McClelan, deceased."
In regard to the second question His Lordship said:
"It is quite clear that if the bequest were made for the
benefit of a charitable institution outside the province the
assessment on the amount would be as follows: A rate of 10
per cent, would be computed owing to the institution being a
stranger in blood to the testator, and this would be doubled
because such beneficiary was outside the province. My judg-
ment is that it is liable to a duty of 10 per cent, because it
goes to institutions that must be regarded as in the same posi-
tion as strangers in blood to the testator, and because it is not
directed that it shall be disposed of for purposes to be carried
out in New Brunswick."
In answer to the third question it was decided that in
accordance with section 18 of the Succession Duty Act, interest
at the rate of five per cent, could be collected from the time of
the testator's death.
REAL ESTATE AS SECURITY FOR DEBT
Under the Bank Act, Canadian banks must not lend on
real estate, but may accept mortgages as additional security
for a debt already incurred. In case of foreclosure they are
allowed to bid in the property, but cannot hold it over a cer-
tain length of time, so that naturally they get rid of it as
soon as possible, and in doing so accept mortgages. The ex-
tent of the banks' business along this line is shown in two
accounts in the bank statement, as given below, and it will
be seen from the figures that it is not large: —
Real estate Mortgages
other than under real
1919 — bank premises estate sold
October $5,463,675 $2,404,772
November 5,586,078 2,405,619
December 5,596,930 2,505,401
1920 —
January $5,545,766 $2,608,622
February 5,611,570 2,615,018
March __• 5,482,719 2,585,361
April J 4,876,459 2,671,132
May 4,910,297 2,622,484
June 4,786,140 2,726,360
July 4,625,775 2,655,462
August 4,435,256 2,727,545
September 4,353,651 2,714,752
October 4,142,987 2,825,245
INVESTMENT
Jtiiinary 7, iQ^i
THE MOXF.TARV TIMES
Paqe 81
82
THE MONETARY TIMES
Volume 66
United Financial Corporation
LIMITED
BOARD OF DIRECTORS
Sir Charles Gordon, G.B.E., President.
President Dominion Textile Co., Limited. Vice-President Bank of Montreal.
D. C. Macarow, Vice-President,
General Manager Merchants Bank of Canada.
Chas. F. Batchelder, Vice-President,
Formerly of Guaranty Trust Co. of New York.
Major H. B. MacDougall, Vice-President,
of Messrs. C. Meredith & Co.
W. A. Black,
Director Molsons Bank,
Vice-President Ogilvie Flour Mills Co.. Limited.
A. Breton,
Vice-President Guaranty Trust Co. of New York.
A. J. Brown, K.C.
Vice-President Montreal Trust Co.
Director Royal Bank of Canada.
Geo. Chahoon, Jr.,
President Laurentide Co., Limited.
A. E. Holt,
Director The Royal Trust Company.
C. R. Hosmer,
President Canadian Cottons, Limited
Director Canadian Pacific Railway.
Bank of Montreal, etc
Wm. McMaster,
President Canadian Explosives. Limited.
Director Bank of Montreal, etc.
Charles Meredith,
of Messrs. C. Meredith & Co.
Harold Stanley,
Vice-President Guaranty Trust Co. of New York.
E. W. Stetson,
Vice-President Guaranty Trust Co. of New York.
J. R. Swan,
Vice-President Guaranty Trust Co. of New York.
A. P. B. Williams, Secretary-Treasurer.
We purchase entire issues of Bonds, and deal in
Government, Municipal and Corporation Securities.
Head Office:
112 St, James St., Montreal
Toronto Office :
Ottawa Office:
London Office :
14 King Street East
709-711 Hope Chambers
46 Threadneedle Street, E.G. 2.
January 7, 1921
THE MONETARY TIMES
Recent Conditions Relating to Investments
New Capital Well Distributed in 1920, With Growing Preference for Essential Indus-
tries — Demand for Tax-Exempt Securities Fairly Well Exhausted — The Course of Prices
as AflfectingI Investments — Bankers Recognize Need of Sound yet Adequate Credit
By ADAM SHORTT, Ph.D.
ON the face of it it is merely a truism to say that capital
investments are determined by the general economic
conditions of the country. On second thought, however, it
may not be quite so obvious as to what are exactly these
economic conditions, or what are their respective importance,
range, steadiness, and capacity for reliable estimate. How
far are they purely domestic conditions and how far foreign
or world conditions. Moreover, in what measure are they
purely economic, and in what measure political, social or
psychological? .
Thus, when we attempt to penetrate our subject we find
interesting questions arising on every side. Some of these
are more or less soluble on fairly stable practical principles
derived from experience, while others can only be noted as
to their general nature and relative influence, but cannot be
reduced to any permanent or practicable operation. By way
of analogy, we may say that economic conditions in general
are like those which govern agriculture. One may determine,
more or less definitely, the character of the soil, the most
effective methods of cultivation, the relative values of
fertilizers, implements and seeds, as also the general climatic
conditions; but we cannot be certain for. more than a few
hours in advance as to what the weather will be. Yet every
one kjiows that the weather is a very potent factor in de-
termining the crop returns. The psychological and tempera-
mental features, whether of individuals, of sjiecial economic
groups, or of public opinion in general, constitute the weather
factor in economic conditions. While understandable in their
effects and radical in importance, they can be predicted with
no certainty. On the eternal uncertainty of weather con-
ditions the weather prophet flourishes, while the trained
meteorologist has little counsel. On the psychological
element in economic affairs the confident predictions of the
speculator and the plausible promoter rely, where trained
economists will not hazard a definite opinion. But sometimes
the weather prophet and the speculator are right, hence their
influence.
Psychological Factor is Prominent
Owing to the uncertainty of the present outlook, the
psychological factor promises to be d very influential force
in determining the course of the stock markets and the direc-
tions of investments. Immediate impressions are likely to
be projected into an indefinite future and to encourage the
conviction that conditions can never return to what were
considered normal before the war. At one time optimism will
govern and determine action, at another pessimism will rule
the day, spreading with subtle and almost irresistible in-
fluence through the minds of those not well fortified by a
long range of experience.
During the greater part of the past year the directions
of capital investments have been fairly steady. There ap-
pears to have been a prevailing assumption that the diffi-
culties anticipated at the close of the war not having ma-
terialized, it was rather late to expect them. The heavy
trend on the part of persons with comparatively large in-
comes towards the purchase of long-term tax-exempt Do-
minion securities, which was so pronounced a factor in 1919,
and which carried those issues to a substantial premium, had
nearly exhausted itself towards the close of the year, when
the last Victory Loan was successfully floated. Thereafter
the flow of capital investment, during the greater part of
1920, was fairly evenly distributed between the various fields
of public securities. Dominion, provincial and municipal, and
private and corporate enterprises; the pulp and paper shares
being naturally popular in virtue of their present prosperity
and attractive future prospects.
All this furnishes a curious parallel to the economic
situation which followed the last great world struggle, prac-
tically brought to a close in 1814. In that case, for the first
two years after the close of hostilities business remained
brisk, the populace spent lavishly, economy was disregarded,
and the conviction became general that no serious re-
action was thereafter likely to occur. It was felt that dur-
ing the long war. nothwithstanding its inflated credits and
currency, and suspended specie payment, a new an3 per-
manent level of values had been established, which were not
likely to be disturbed for an indefinite period. In the early
part of the third year, however, as in the present case,
stagnation began to develop, raw materials to accumulate,
and prices to break. Industries slackened their pace and
many ultimately closed, unemployment spread and a long
and severe depression followed. In the course of this re-
action, deflation was thoroughly accomplished, exchanges
were readjusted, specie payment was resumed, wages and
the cost of living fell concurrently, rendering production on
a large scale both possible and profitable, and at prices suit-
able to the domestic consumer and the foreign markets. Pros-
perity on a sound basis rose to volumes undreamed of be-
fore the war, with increasing funds for investment drawn
from a much broader section of the general public. These
conditions, unfortunately, tempted reckless speculation,
promising fabulous returns and letting loose in the economic
world the psychological forces already referred to, the whole
leading once more to reaction and crisis.
How Far Will Parallel Go?
It does not of necessity follow that the general parallel
with conditions after the close of the Napoleonic wars which
has so far existed, must continue during the third and fol-
lowing years of the modern cycle. Yet there are many in-
dications that healthy trade conditions on a sound financial
basis should be reached as rapidly and effectively as possible
over a wide area. This will permit of commercial and ex-
change relations being re-established, with the resumption
of specie payment, and the affording of safe and attractive
investment for capital. It would also promise employment
for labor at reasonable rates of remuneration measured, not
by inflated credits, but by a standard of living bearing some
fair equivalent to the output of the worker in his own con-
tribution of products or services.
There is, of course, much to be said for a gradual process
of deflation if it could be effectively and justly carried out.
But this is quite impossible. Certain lines of industry, such
as building trades, do not lend themselves to this process. On
the other hand, owing to the rapid accumulation of raw ma-
terials in the textile, leather, sugar and other trades, where
production can take place with fair rapidity, the finished
goods are certain to fall in price long before rents from
housing, fuel, and transportation would adjust themselves,
especially if encouraged to maintain a high level as long as
possible. Large sections of the community, however, are
liable to suffer a severe shrinkage of income before there is
a corresponding fall in the cost of living in other lines. A
more rapid adjustment all round would be more equitable
in the end, and the sooner establish a sound and reliable basis
for capital investment.
In the face of present conditions capital is naturally shy
of ready investment in even standard lines of production,
while prices are in a more or less crumbling condition, not-
withstanding elaborate attempts to sustain them at levels
above their normal gravity adjustments. It is quite true that
in well-established industries with their fixed capital in good
working condition and with sufficient supplies of raw ma-
THE MONETARY TIMES
terial at suitabli- rates, they are able to make a rapid turn-
over of their capital ami thus secure reasonable profits, even
on a gradually falling market. Such industries, however,
can fairly well take care of themselves even on a rapidly
falling market, and they are the sooner in a position of
stability to meet future developments.
Must Be Shrinkage of Values
There is nothing to be gained and much to be lost in
attempting to ignore the fundamental fact that in the process
of deflation or readjustment of values, a certain shrinkage of
fortunes must result, just as a corresponding expansion was
temporarily secured through the highly artificial process of
inflation incidental to the great war. But when we come to
consider the great benefits which result for a country when
its business is restored to former conditions, the temporary
sacrifices necessarily involved in reaching this basis may be
philosophically faced if not altogether relished. When the
alternative is considered the outlook for new investment is
certainly not hopeful. A country such as Canada cannot ex-
pect to confine its business within its own borders. If, there-
fore, the attempt is made to maintain prices upon a per-
manently higher level than in competitive countries, or to
have the decline in prices lag behind the fall in adjoining
countries, two complimentary results must inevitably follow.
In the attempt to sell our own goods abroad we are steadily
handicapped by high cost of production. Our trade is in-
evitably retarded and many industries must either undergo
heavy sacrifices or curtail — possibly suspend — their business
indefinitely, foregoing profits and throwing labor out of em-
ployment. Again, with high prices maintained in our do-
mestic markets, Canada becomes an exceptionally attractive
country into which to import foreign goods, despite our tariff
rates. The slow readjustment, therefore ,is a stagnating and
unprofitable line of policy to follow.
Exchange Rate Now a Real Factor
It is to be observed that the barrier of a high exchange
rate does not materially affect purchases under the com-
pulsion of necessity to buy in any market available regard-
less of costs during war conditions; as also during post-war
condition depending on the reckless extravagance of those who,
in proportion to their previous incomes, have shared greatly
in war profits. When, however, war conditions have passed
and the accumulations of the spendthrift classes are trans-
ferred to more thrifty hands, those countries enjoying a high
favorable exchange rate, notably the United States and even
Canada itself, with reference to the European countries, will find
themselves in a very difficult position as regards the sale of
their goods. So long as the foreign purchaser has to pay the ex-
change rate with the United States and Canada, there will
be no great loss to American or Canadian exporters, but
when supplies are available from other countries on the basis
of the sale of bills on London, then Canadian and American
exports to Britain, not to mention other European countries,
must conform to similar conditions.
Then the return on the goods is not the nominal value
in the foreign country, but simply the domestic rate at which
the exchange drawn against the foreign country will sell in
one's own country. Thus the sale of a cargo of wheat to
Britain at so many pounds in the British market nets the
American exporter, and through him the farmer, just so
many times, say, $3,40, the price of the English pound in the
New York market, for the time being. A similar cargo
would net the Canadian exporter just so many times $3.80.
If the Canadian and United States farmers wish to spend the
full returns from their grain in the purchase of British
goods, they would recover in the corresponding low rates at
which they could purchase sterling exchange, what they lost
in the selling of sterling exchange drawn against their ex-
ports; the net result to both would be the same. In other
words, in both Canada and the United States, a given num-
ber of bushels of wheat would purchase just the ,ame
quantity of British goods. If, however, the Canadian and
.American farmers have debts to pay, or wish to purchase
goods in their own countries, and the prices are the same in
each, the American farmer would be worse off than the Can-
adian, while both of them would suffer a severe shrinkage
in their incomes, so long at least as prices in their respective
countries are still approximately at war levels.
United States is at Disadvantage
The more intelligent observers in the United States are
not slow to recognize their disadvantages so long as war
rates prevail. To protect themselves in the world's markets,
the more enlightened Americans perceive the necessity for
reducing prices and costs as rapidly as possible and as nearly
as possible to a pre-war basis at least, in order that the
handicap of a high favorable exchange may not cripple the
foreign trade of the United States in proportion to the re-
covery of the productive power of competitive countries. The
same, of course, applies to Canada only in a slightly less
degree. These are important factors, therefore, affecting
very radically and with increasing power the prospects of
capital investment in Canada.
Essential Industries Have Best Outlook
As regards the relative attractiveness for capital in-
vestment of the fields of the necessaries and luxuries of life,
it may be concluded that, at the present time, the former is
much the more promising. During periods of inflation, how-
ever, as in the later years of the war and the first two years
of peace the contrary would be true. In the first place, in
periods of inflation a relatively prosperous community, such
as that of Canada or the United States, does not purchase
much more of the necessaries of life than in other periods.
It is the demand of non-productive armies and the general
waste of war which renders the necessaries of life scarce and
dear. In times of inflation and consequent extravagance,
however, there is no limit to the markets for luxuries save
only the extreme limit of pui'chasing power. Not the body
but the fancy has to be satisfied. In exceptionally prosper-
ous periods, therefore, it is in the line of luxuries that the
widest margins of profits are realized and the greatest
fortunes are made. There arises, of course, a great and most
virtuous wail over the high cost of the necessaries of life,
while most of the same parties pay without a murmur famine
prices for fleeting and unprofitable luxuries.
When, however, the spending power is curtailed, the
urgency of the necessaries comes to the front, and the dis-
pensable luxuries and the King's revenue therefrom are
among the chief sufferers. During critical periods of trade
and finance, it is obviously safer for investors, who are not
quite on the inside of the market, to place their capital with
those enterprises which are connected with the production
of the necessaries of life, rather than its luxuries Fortu-
nately, the Canadian industrial field hitherto has been chiefly
concerned with the great staples of trade.
Building Costs May Remain High
One of the most difficult aspects of capital investment is
that connected with building and housing. Unfortunately
while the increasing costs and lack of materials, which meant
lack of labor, restricted, during the war period and since, the
construction of houses for the common citizens, enormous
funds with all available labor at high wages were employed,
chiefly by the Dominion, but also by the provincial govern-
ments and municipalities, in the construction of extensive
buildings connected more or less with war work, and many
of which are now of but little service in proportion to their
costs. Private corporations connected directly or indirectly
with war contracts also spent large sums in buildings and
other fixed capital, while those contributing to the amuse-
ment of the masses and the furnishing of other forms of
luxury found it quite profitable to build for these purposes,
in spite of the high costs involved.
The pressing popular need for housing still remains,
therefore, and there ^s less prospect of an immediate decline
in cost in that essential line than in any other. This is
chiefly due to the fact that the cost of building is chiefly de-
January 7, 1921
THE MONETARY TIMES
85
termined by the cost of high-priced labor as distinguished
from the standard raw materials of construction. As a re-
sult, so long as the exceptionally high remuneration of the
building trades and the shortness of their hours remain on
the present basis, the cost of building cannot substantially
decline, even should there occur a considerable reduction in
the more essential building materials.
The chief sufferers from the present unfortunate situa-
tion are the lower or unskilled sections of the laboring
classes, the shop-keeping assistants and the numerous
clerical classes whose incomes are far below those of the
building trades. Many schemes have been propounded for
the relief of the situation, but they are all brought to a stand
by the excessive cost of building. Naturally, therefore, at
the present time, very few persons will invest capital with
any expectation of profit in the construction of dwelling
houses for rent, or even in the construction of closet apart-
ments on the cheapest lines that will pass inspection. Apart
from victimising the insurance companies, there is no pos-
sibility of a rapid turnover in the investment of capital in
housing accommodation. Aside from governments, therefore,
or those institutions who build without hope of permanent
pecuniary reward, there is likely to be little capital invested
in buildings until a paralysis of building leads to a reduction
of costs.
Needy Cannot Pay Prices
This is the only important field in Canada which illus-
trates the situation which prevails in so many lines in
Europe. Briefly the situation is one in which there is wide-
spread and urgent need, but very little economic demand.
In other words, the needy have no adequate means of pay-
ment for the supplies they require. In the case of many
millions of people in Europe, there is a most urgent need for
supplies of practically all the necessaries of life, but as these
people have little of commercial value to offer in exchange,
their need does not furnish an economic market; it promises
no remuneration for capital devoted to the supply of their
wants. This condition has occurred after every great war,
but it was sadly overlooked by the thoughtless commercial
optimists rejoicing over the prospects of a large and highly
profitable market for the supply of Canadian and American
products in the areas devastated by the war.
The dire need of Europe extends far beyond the regions
which these persons had in mind. America could dispose of
all her surplus food and keep most of her industries busy
without adequately meeting these urgent needs, but for the
vast majority of our products we should have to take the
European I.O.U.'s for an indefinite period. In other words,
their chief available export is the product of their promissory
printing presses, one war industry which is still in active
operation among them.
In point of fact what is required to meet the most urgent
need of Europe is charity, not trade, much less profiteering.
In view of prospective production it cannot be too clearly
realized that the economic markets of the world are far more
limited since the war than they were before it. In the re-
covery process, supply bids fair to exceed, for some time, de-
mand backed by the means of payment. Both the capital and
labor which hope to successfully compete for the supply of
such limited markets, must revise as speedily as possible the
cost of production. Apart from the economy of mechanical
devices and industrial organization, this means the reduc-
tion of the cost of living, and, under present conditions, this
means the reduction of profits and wages, into which ulti-
mately all costs resolve themselves. With the enormous
supplies of our native raw materials and the steadily falling
urioe'^ of the chief foreign raw materials, except fuel, it
should be possible for Canada to adjust itself to the new
world conditions to as great an advantage as any other
country, not excepting the United States.
One primary requisite of a sound economic condition and,
therefore, of the safety of the field for capital investment,
is the maintenance of the trade and particularly the com-
merce of the country upon a fluid basis of exchange, that is.
a fluid money market. Now an inflated credit market is no
proof of a fluid money market; nor do the highly expanded
banking returns give any assurance of a fluid money market.
On the other hand, it is quite evident that the leading Can-
adian bankers are very much alive to the real needs of the
situation, and take a very intelligent view of their functions.
Their energies ai'e being directed alike in expanding accom-
modations in certain directions, while curtailing credits in
others, to bring as large a volume of the trading capital of
the country into the most flexible and serviceable form pos-
sible. This is essential to prevent the tying up of large funds
in stocks of goods or forms of investment which cannot be
realized upon within comparatively brief periods. It is highly
necessary to devote commercial capital to productive indus-
tries with a rapid turnover, thus permitting of the maximum
employment for labor in the supply of essential goods and
services.
In any case it is specially desirable that the irresponsible
speculator should be kept out of the capital market until con-
ditions are once more fairly normal, when his operations will
alfect mainly h.mself. In critical periods, when even the
most experienced captains of industry and pilots of finance
are more or less nervous and worried as to the extent and
duration of this, that, or the other squall, current, or tide,
the speculator obscures all issues, displays false signals, and
in raising false hopes induces in the end more widespread
disaster or even despair. -All past history of the re-
adjustments after important wars establish the certainty of
the process of deflation with an inevitable shrinkage in
values. But when the situation is intelligently realized and
calmly dealt with, panic can be avoided and the disasters
which are almost entirely due to it successfully evaded.
EXPANSION OF AUTOMOBILE INDUSTRY
When the war broke out the number of automobiles in
use in Canada was 67,415, but now the number is 400,000, and
the value of those registered is $600,000,000. Although the
price of cars and of gasoline has increased during the current
year, their use for pleasure as well as for business purposes
has steadily increased. For the manufacture of automobiles
and the assembling of parts $54,000,000 is invested in Cana-
dian plants, which employ 15,000 hands, receiving annual
wages of $15,000,000. Sales of cars exceed $100,000,000 an-
nually.
A large portion of the material used in the production of
a Canadian car is imported. For parts alone the annual bill
is $12,000,000, while the requirements of automobile manufac-
ture entail an increased importation of glass, rubber, iron and
steel. The growing use of automobile vehicles accounts in
great measui-e also for the steady increase in imports of petro-
leum products. For the twelve months ended June 30th last
514,897,000 gallons of oil were imported, as compared with
4.3.3,018,000 gallons for the preceding twelve months. The
cost of this year's imports of oil in its finished and crude
forms is estiinated at $35,000,000.
The Canadian Bank of Commerce, in its monthly commer-
cial letter for September, points out that this, however, does
not represent the whole cost of maintaining cars. During the
current year a large amount of capital has been invested in
garages, public and private. The former are now as numer-
ous as were once village blacksmith shops, which they have in
many cases absorbed, and serve to a very large extent the
users of pleasure cars. They also give employment to a large
number of highly-paid workmen. While expenditures on
these accounts may to some extent facilitate production and
trade, the physical volume of the former has not materially
changed. Continued expenditure of labor and capital on so
large a scale without tangible results in exportable products
will not aid in bringing about more satisfactory condition?.
Declines in prices of essential food, clothing and house-build-
ing materials cannot be looked for so long as a di.sproportion-
ate amount of capital and labor is expended on sustaining
activities that do not produce the necessities of life.
IKE MONETARY TIMES
Volume 66
CANADIAN BOND SALES $320,000,000
More Than Two-Thirds of This Total Was Placed in the
United States — Large Amount of Provincial and Kailroad
Financin;; — Many Municipalities Make Domestic Loans
CANADIAN bond sales in 1920 reached the substantial total
of $324,914,667, according to figures compiled by The Monc-
laiy Times. A summary on another page of this issue shows
that this total is made up as follows: Government (all pro-
vincial), $125,993,000; municipal, $56,371,391; railroad, $96,-
600,000; corporation, $46,050,276. In the absorption of this
large amount, however, Canada participated only to a small
extent, more than two-thirds, or $223,084,000, going to
United States investors.
The amount of Government bonds sold, when compared
with the five years previous, seems small, but then there
was no war financing by the Dominion Government. Sales
of municipal securities exceeded those of the previous year
by about $28,000,000. The bulk of these bonds were placed
iii Canada, although slightly more than $10,000,000 found
their way across the line. The record of municipal sales
since 1911 shows the following results: 1911, $30,295,838;
1912, $19,767,365; 1913, $20,550,239; 1914, $34,483,360; 1915,
$31,910,214; 1916, $19,640,778; 1917, $17,955,714; 1918, $41,-
860,361; 1919, $26,274,089; 1920, $54,271,391.
Railroad and other corporation securities' increased
greatly over the previous year. All of the railroad bonds
were sold in the United States, while the greater part of
the corporation bonds was disposed of across the line.
A feature of the bond sales in 1920 was the large num-
ber of municipalities which successfully arranged their own
financing. Two Provinces, Alberta and Saskatchewan, are
also included in the list of domestic loans.
A conservative estimate of local loans during the year,
including those made by a large number of western school
districts and rural municipalities, which have not been heard
from, would be about $7,000,000. This amount seems small
as compared with the total of all bond sales, but it is the
largest on record.
In addition to the 6 per cent. 10-year bonds, the Province
of Alberta also disposed of a considerable amount of savings
certificates. The exact amount sold during the year has not
yet been ascertained, but up to the end of November the
total was $1,074,274, as compared with $681,029 for the whole
of 1919.
Ont.
Issue
Woodstock, Out.
Kitchener, Out.
Lanark Count.v
Oweu Sound, Out
Exeter, Out.
-Hanover, Ont.
Cote Ste. Mlcln-1, ijn
Xorth Battleford, .s.is
Regina. Sask
Whitewood, Sask
Grand Prairie, Alta.
Traii, B.C _
Godericli, Ont
County of Ontario - .-
Guelpli, Ont
Milton. Ont
Brantford, Ont
Cobourg. Ont. ._..
65,000
100,000
100,000
SS.OOO
50.1100
45,000
Inter-
Price at est
Maturity whicli sold cost
15 years
20 instal.
15 years
400,000
s. notes) 30,000
61,000
._ 3,000
13,000
9,000
10,000
50,000
_ 16.225
S2,000
_ 600,000
50,000
Hamilton. Ont _ 475,000
15 years
10 years
20 years
Chatham, Ont 100,000
Halifax, N.S 500,000
HaUfax, N.S 300,000
Halifax, N.S 43.000
Stamford Township, Ont 22,000
Province of Alberta _ _ 500,000
Province of Saskatchewan 1,600.000
Province of Saskatchewan 380.000
Moncton, N.B 300,000
London, Ont 265,000
Moose .Taw. Sask 22,000
Moose .Taw, Sask. (schools) 64.000
Halifax, N.S 550,000
6 20 years
6 30 instal.
6 20-yr. ser.
6 20 instal.
Vo-e 20 instal.
6 15 years
6 10 years
33 years
10 years
10 years
10 years
7 years
30 years
10 years
100.00
100.00
6.00
6.50
100.00
7.00
92.00
98.00
100.00
7.28
6.00
100.00
6.00
6.50
100.00
6.00
6.50
6.00
iVz
100.00
98.16
92.85
98.16
98.00
100.00
100.00
ino.oo
6.00
6.25
6.26
6.00
5.00
S.OO
514
15 years
10 instal.
10 years
86.40
100.00
95.365
CORPORATION
JANUARY
Drummond Apartment Biiildinfls
FEBRUARY
ReRina Trading Company
MARCH
Canaiiian Tungsten LampCo.. Ltd.. guaranteed
by Can. Gen. Electric Co
St. John Drydock & Shipbuilding Co . Ltd
APRIL
Ames Holden Felt Company. Limited
McCormicli .Manufacturing Company, Limited
Uniied Grain Growers
Acadia Sugar Refining Co
Granby Consolidated Min. Smelt. & Power Co.
Bell Telephone Co- of Canada
MAY
Ames Holden Rubber Boot Company
.•\bitibi Power & Paper Company
JUNE
Ontario Smelters & Refiners. Limited ...
.Northern Light Railways Company
Howard Smith Paper Mills, Limited
Shawinigan Water & Power Co.. Limited
JULY
Kaministiqua Pulp & Pap. Co. (1st mt. ski. fd.).
AUGUST
Manouan Pulp I'i: Paper Co. (convertible deb.)
Manouan Pulp & PaperCo. (1st nit. skg. fd. bds)
Western Canada Pulp & Paper Co
OCTOBER
Paramount Victoria Theatres. Limited
Benson-Hines London Hotel Company
Ottawa Light, Heat &- Power Company
.Massey-Harris Company. Limited
NOVEMBER
St. Francis Power Company.
Dominion Power & Transmission Co.. Ltd
DECEMBER
Kiordon Company. Limited
Moimt Royal Hotel (convertible deb.)
K. & S. Tire and Kubber Goods Company
Canadian Western Steamships Company
8
650.000
375,000
600.000
750.000
2.000,000
2,500.000
5.500.000
250,000
300,000
450,000
4,000,000
600.000
1.750,080
1.000,000
300,000
600,000
1.200,000
6,500.000
4.000 000
300,000
850,000
20 years
20 years
20 years
serials
15 years
20 years
20 year serial
10 years
15 years
6 years
15 years
25 years
20 year seri:
20 years
1923
15 years
Approx
Int.
Basis
7.00
7.00
6.75
7.00
8.00
Royal Securities Corporatic
Bell St Mitchell
Thornton, Davidson & Company
Nesbitt. Thomson & Company
Sun Life Assurance Company
Graham. Sanson & Company and Syndicate
New York
Royal Securities Corporation and Syndicate
Tanner. Gates & Company
raham. Sanson & Company
ATlus Bond & Security Company
Ulas Bond & Security Company
Graham. Sanson & Company
Burdick Bros.. Ltd. Offered with bonus of 50% com.
Brent, Noxon & Company
Royal Securities Corporation and Harris, Forbes &
Company, Incorporated
VVm. A. Read & Company
al Securities Corporation and Syndicate
N. A. MacDonald & Co.
Richardson. Sheppard & Thorburn
1,750,000
2,500,000
S,.'iOO,000
4,000,000
125,000
1,200,000
4.000,000
600.090
6.500. UOO
Janiiary 7, 1921
THE MONETARY TIMES
87
CANADIAN BOND SALES IN 1920
PROVINCIAL
JANUARY
ish Columbia..
FEBRUARY
New Brunswick
Saskatc;he\<
Ontario ....
Ontario...
MAY
IVlanitoba (Farm Loans)
Manitoba (Rural Credits Treas. Bills).
.Manitoba
Nova Scotia
Nova Scotia
■New Brunswick
Alberta -.
JUNE
British Columbia
Ontario
JULY
British Columbia
British Columbia
Quebec
<Juebec
Ontario (Treas. Notes) .
Ontario
AUGUST
Nova Scotia
Manitoba
.Alberta
British Columbiii
Manitoba
SEPTEMBER
.Alberta University
Saskatchewan..
OCTOBER
British Columbia
NOVEMBER
Ontario
Nova Scotia.
Alberta
Manitoba
DECEMBER
Ontario
Nc
Br
MUNICIPAL
ONTARIO— January
Flamhorn Township. East
Kitchener
Kitchener
Etobicoke Township
Bridgeburg
Toronto (Harbour Commis:
Issues under .?2S,(X)0
February
Midland
Carleton County
Whitby Township. East . . .
Charlottenburg Township
Woodstock
Renfrew County.
Issues under $2.S.0(XI
S
■i.4S0,(X)()
,^0(1.1100
2.498.000
2.850.000
3.500.000
3.500.000
5.000.000
500.000
1. 000.000
2.0(10.000
B.SOO.OOO
500.000
1.000.000 {
2.000.000 I
800,000
2,200.000
2.800.000 j
3.000.000 !
I. .100.000
L.VIfl.Oflfl
2..'!flfl.n00
2 ,sno 000
i; (Kin 0011
.S,(10fl ()0(l
.wio.non
7'J.';.(ioo
2.000.000
3.000.000
^..sflo.nno
1.000.000
.sonono
7.w,ooo
3,000,000
3.000.000
5,000 000«
2.000.000
1.000.000
750.000 i 6
2!l,5(i8
4B.,'i()0
.TD.dOO
.sn.ooo
.so.ooo
J.ooo.ono
61.934
30.000
40.0(10
m.ax)
lOO.OflO
I.SO.OdO
W.Xtl
;.T2-.'.;t,i4
25 years
10 years
5 years
5 years
5 years
3 years
4 years
15 years
5 years
3 years
4 months
S years
5 years
■ 5 years
10 years
3 years
.■» years
5 years
to years
5 years
6 months
10 years
6 months
10 years
5 years
5 years
5 years
3 years
5 years
6 months
3 years
7 years
10 years
10 years
10 years
6.52
I 6.52
5.83 i
20 instalments
30 instalments
20 instalments
20 instalments
30 instalments
34 years
Various
20 instalments
30 instalments
20 years
30 instalments
20 instalments
6.12
6.05
6.00
5.96
6.28
6.20
Purchaser
Price
Paid
Sold in
U.S.
Dominion Securities Corporation.
S
Wood, Gundy & Company and A. E. Ames & Company
A. Jarvis \ Company
A. Jarvis & Company. Canada Bond Corporation.
Wood, Gundy & Company and R. C. .Matthews & Co.
J. M- Robinson & Son and the Eastern Securities
Company. Limited
9,S.15
J. P. Morgan & Company. National City Company
and Harris Forbes & Company
J. P. Morgan & Company and Syndicate
Harris. Forbes & Company and National City Company
•93.87
3.500,000
Dominion Securities Corp. and Wood. Gundy & Co.
•92. S5
3,500,000
A. Jarvis & Company and Syndicate
100.65
5,000,000
A. E. Ames & Company
99.314
500,000
A. E. Ames & Co. and Dommion Securities Corp.
102.20
1,000.000
United Financial Corporation. Limited
Wood, Gundy & Company and Syndicate
•91.633
6,800,000
Wood. Gundy & Company
100.00
500,000
1,000,000
2,000,000
Wood, Gundy & Company and Syndicate
*89.66
R. A. Daly & Company and Syndicate
•91.21
800,000
R. A. Daly « Company and Syndicate
101.19
2,200.000
A. E. Ames & Company and Syndicate
A. E. Ames& Company and Syndicate
97 715
101.57
3,000.000
'Wood. Gundy & Company and Syndicate
•88.14
2,000,000
British-America Bond Corporation and Syndicate
100.00
1,300,000
British-America Bond Corporation and Syndicate
99.88
I 500,000
Bank of Montreal and others
A. Jarvis & Company and Home Bank
99.50
3,000.000
A. E. Ames & Company and Syndicate
98.317
5,000,000
National City Company. Limited
101.287
500.000
United Financial Corporation. Limited
96.58
1.800.000
Seattle National Bank and Syndicate
98.91
3.000,000
A. Jarvis & Company and First National Company
•89.66
4,500,000
Wells-Dickey Company
99.25
750.000
Wood.Oundy & Company
Carstcns & Earles. Royal Financial Corporation.
103.351
1,000,000
British American Bond Corporation and
Gillespie. Hart * Todd
Carstens & Earles, and Syndicate
100.73
1,000,000
Wood. Gundy & Company
100.00
Minnesota Trust & Loan Co.. and Wells-Dickey Co.
A.Jarvis&Co..andthc Home Bank of Canada, private
3.000.000
A. Jarvis & Company. Halsoy, Stuart & Company.
103.567
3,000,000
and the First National Company
Wood. Gundy & Company. A. E. Ames & Company.
I04..S33
5.000.000
R. C. Matthews & Company and Illirois
Trust & Savings Company
Dominion Securities Corporation and Wm. A.
102.02
Read & Company
Harris, Forbes * Company and the National
City Company
Wells-Dickey Company and the Minnesota
Loan 8c Trust Company
Dominion Securities Corporation & Syndicate
89,243,000
.Morgan-Dean Harris & Company
C. H. Burgess & Company
C. H. Burgess & Company
W. L. .McKinnon & Company
A. E. Ames & Company
Various
C. H. Burgess & Company
97.67
A. E. Ames & Company
Brent, Noxon * Company
Dominion Securities Corporation
Wood. Gundy St Company
Various
THE MONETARY TIMES
Volume 66
BOND SALES (Continued)
lirottfihl Forward
Mimico
Mimico
Renfrew Town..
Niagara Fulls. ..
Ningara Falls...
Sarnia
Sandwich
Hamilton
Windsor
April
Walkerville
Chatham
Chatham
Toronto
Issues under $25,000.
May
Sarnia
Walkerville
York Township
'ille
Brantford
Sandwich
Toronto (Separate School).
Issues under $2.'i.00()
Linci.ln County
Trafalgar Township..
Chatham
Sudhury
Sai
St. Catharines
County of Renfrew.
County of Renfrew.
Kingstiin .
Sault Ste. Marie....
Port Arthur
Carleton County....
Gait
Gait
Fort William
Fort William
Fort William ..
Fort William
Peterborough. . .*.
Issues under ti.S.OflO.
July
Ingersoll
Cobourg
Augu«t
Hawkesbury.
East Sandwich Township.
Toronto Township
■ Tor, 
