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BBDIN&LTQT'APR  1^^1923 


Trade    Review    and   Insurance   Chronicle 


OF  CANADA 


Volume  68 

No   1 


TORONTO,  JANUARY  6.  1922 


KHIMtLlMUm 


CANADIAN 

GOVERNMENT    MUNICIPAL    AND    CORPORATION 

BONDS 

BOUGHT    -    SOLD    -    QUOTED 

Comult  u<  Penonatly  or  by  Mail 

DoKimon  Securities  (orporatio.n 


MONTREAL  BRANCH 
C*nftdft    Life    riuildtfig 


LIMITED. 

Esi>bli>hid   1101 
16  KING  STREET  EAST 

TOPvONTO 


LONDON  ENC  BRANCn 
No.  2  Aatlin  Friftrt 
A  L.Full«ii*n.  Mansff«« 


GEO.   WEIR 
General    Manager 


For  Canada 


KNTAItl.ISHKI)  1869 


HEDLEY  C.  WRIGHT 

Asst.   Gen.    Manager 

For  Canada 


V 


LONDON  GUARANTEE 

AND  ACCIDENT  COMPANY,  LIMITED    ^^"^ ^\^ 


ASSETS  EXCEED 
$31,000,000 


Head  OflFice  for  Canada.  TORONTO 

GUARANTEE  BONDS 

AUTOMOBILE  LIABILITY 

A  VIA  TIOK 

ACCIDENT  S:  SICKNESS 


\ 


CLAIMS  PAID 

$60,000,000 


POLICIES    xTy^i^T-i  ¥     i-^xifnirn^     r^fr>f7    insurance 


OF  THE 


NORTH  EMPIRE  FIRE 


COMPANY 


ARE  CLARA\Tl-t:0  HY 
LONDON     GUARANTEE     AND     ACCIDENT     COY..  LTD. 


ANNUAL  S'^     ISTICAL,  REVIEW  and  OUTLOOK  NUMBER 


THE      MONETARY      TIMES  Volume  68. 


Forty  Years  of  Service 


FOR  forty  years  this  organization  has  devoted 
its  energies  to  the  purchase  and  sale  of  high 
grade  investment  bonds.      During  this  period 
it  has  financed,  through  bond  issues,  the  following 
public  utiUties  in  Canada 

Montreal  Tramways  Co. 
New  Brunswick  Power  Co.         ^^^ 
Winnipeg  Electric  Railway  Co.     ^  Us 
Ottawa  Light,  Heat  &  Power  Co.    v©  i 
Montreal  Light,  Heat  &  Power  Co. 
Bell  Telephone  Company  of  Canada. 
Maritime  Telegraph  &  Telephone  Co. 
Dominion    Power    &    Transmission    Co. 
Hamilton  Electric  Light  &  Cataract  Power  Co. 
Hamilton  Cataract  Power,  Light  &  Traction  Co. 

In  addition  to  its  activities  in  the  utility  field 
it  has  distributed  in  Canada,  Europe  and  the  United 
States,  bonds  of  the  Dominion  and  Provincial  Gov- 
ernments and  of  all  the  principal  cities  in  Canada. 


Harris,  Forbes  &  Company 

Limited 

21  St.  John  Street  C.P.R.  Building 

Montreal  Toronto 

Harris,  Forbes  &  Company  Harris  Trust  and  Savings  Bank  Harris,  Forbes  &  Company 

London,  England                                      Bond  Department  Incorporated 

New  York                                                  Chicago  Boston 


January  6,   1922. 


THE      MONETARY      TIMES 


General  Index  to  Subjects,  Monetary  Times  Annual 


vxr.v. 


IKATLHE    SKCTIO.V 


Air.ilis    liiiiiiiif   till-   I'asi   Vrar,    Fi'iltfral    —  It 

Albcrla    I'luiuler's    Message     S.* 

Krlll^li    Columbia    Mineral    output    OT 

Uu.-.iiii>ss     liidlies     Slinw    Year's     Develo|)- 

IIIIMIIH     9 

Canada's  licoiioiiilc   I'rogress  at  a  c.laiici'..  \J 

Kcoiiornlc  Trogross  at  a  (Jlauie,  Canada's.,  t-.> 

I'ericial   AITalrs   Mininif   the   I'ast   Year    11 

Uoiiieslead   Entries   Have   Been   Low    27 

Leglslallon    of    lOil,    Provincial    28 

Nova   Scotia    Coal    I'rodiicllOM    13 

Ontario  rremlcr's   Message   25 

premiers   Write   of   11)21    and   Outlook.   ITo- 

vlndal     2S 

Prince    Kdward    Island    Premier's    Message  2A 

Prospect,    Itetriispcct    and 7 

Pi'ovlnccs'    invasion    of    Hanking    I'leld    J3 

Provincial    I.egislallon    of    11)21     28 

I'rovincliil  Premlci^   \\  iiic  ,ir  n.'i   iin.i  iini- 

look     20 

Ilallwa.v     l)evelo|lMi(']||^     juiiiiik     Uic     I'asi 

Year     10 

Keadjuslmcnt   in  llie  Steel  Indnslry    ad 

llcti'osiiect    and    Prospect    7 

Saskatcliewau    Premier's   Message    2.') 

Some    Weakness    In    Canada's   nevelopinent  in 

Trade   Decline   a   Slgnlllcant    Feature    10 

Indlcc? 


Y'car's      Developnient.      ISnsine 
Show     


ilANKINti 

Hank  Capllal  and  Hesorves,  Movement  or  , 
Hank  Deposits  and  Loans,  Helallon  or  ... 
Hank  I'iKures  Compared,  Twelve  Months, 
Hank  Shareholilers,  Prollts  Accruing  to  . 
Hunkers'     Assoclalimi     Lducalional    Course^ 

Hanking    Field.    Provinces'    Invasion  of   

Hanks'    Services    in   PuliHc    Finance    

Hank  iMearings   and   What   The,v   Mean   

Hond    Market,    The    11)21     

Branches    Arc    Distributed,    How    Hank    


1) 


41 

31 
50 
70 
38 
23 
40 
H 
60 
GO 


Call    Loan,    Movemi'nt   (jf   Cnrreiil    and    ri2 

Canadian   Hanks  In  the   Foreign   Field    43 

Canadian  Hanks'  .Net  I'ronis  and  Dividends  3« 

cluajljogs,     Hank     02 

clearings  and   Wliat  They   .Mean.   Bank   54 

Coinage    of    Hoyal    .Mint    S.'i 

i;iirrent  and  Call  Loans,   Movement  of   ....  52 


Deposits   and    Loans.   Relation  of   Bank    

DIrectois,    Loans    In    Hank    

DIvlilcMids  and  Profits,  Canadian  hanks'  Net 
Dominion  Trust  Company,  Liiinidalion  or, 
Dominion  and   Post  Ofllco   Banks    


Kslates   In   the  Year   1921,  Some  Big, 

Kxrhange    Quotalions     

i:\lenslon    or    Banking    Service    


Farmers'    Bank    Assets    

Foreign   Field,  Canadian   Banks   In   the 


31 
5i 
3« 
74 

58 

72 
iVi 
22 

till 

i:i 


lireat  West   Bank   .Not   Yet  siarled    . 

How   Hank  Branches  Are  nislributed   

How  uur  Currency    Be(|Ulrements   Are  Mel 

Legal   Decisions  Arrcciing  Hanking   

Legal    Decisions    AUecling   Trust   Companies 

Legal    Decisions    on    Public    Finance    

Li(iuidati<ui  iit  Dominlcui  Trust  Company  .. 
Loans    to    Hank    Diieclors    

Montreal  and  Quebec  Savlng.s  Institutions 
Movement  or  Bank  Capital  and  Bescrvo  .. 
.Movement  of  Current  and  Call   Loans   .... 

rVet      Pronis      and      Dividends.      Can.vllan 

Banks',     .* 

.\ewronndland   peveloi)mcnl  Planned    

Post  OlTlce  Banks,  nomlnlon  and 

Pi'oflH    Arfiiiliir   to    Hank   Sharehoiiii  r~ 


PAGE 

Ilelatlon  or   Bank   Deposits    and   Loans    Si 

Bevlew  or  Canadian  Hanking  in  1021   33 

Hural  Credits  In  Canada,  Orowih  or «« 

Some  Big  Ks'ates  In  the  Year  1921    72 

Twelve  Months'  Bank  Figures  ComiiareiL,    M) 

IXVE.STJIE\T 

A  lianadian  Trial  or  the  City  .Manager   121 

Anomalies   in  .Munlel[ial   Ooveriunent   tW) 

Boai-d  or  Commerce  Arl  L'llra  Vires  ...'....  Hi 

Bond    Market.    The,    iVil    Jo 

Bond  Sales  Di  1021    W 

Borrowing  in   Britain.   Five  Decades  of  ...  tOi 

Canada    ShMimshlps     Tranic     130 

Canada's    Financial    l'os|t|r)ii    summarized.,  lue 
City   Manager,   A   Canadian   Trial  or  the,   ..  124 

Companies    liicorporaleil    In    1921,   .New    lOC 

Course   or   Ballroad    Karnlngs    I  Id 


Decades    or    Borrowing    In    Brita.'n 
F..xchange    Ilecord,    Slock     


ini 


FInanrlat  Position   Snnmiarlzed,   Canada's..  108 

Financing  In  l»2l.   Large  Volume  New   W 

Five  Decades  of  Borrowing  In  Britain  lOJ 

(jrowlh    or    Population    Has    Been    Plsap- 
lioiiitlng     lie 

Investments,    Legal    Decisions   or   1941    Ar- 

racllng 138 

Investment  Field,  The  Past  Year  In   83 

Land   Settlement   and   Immigration    140 

Large  \olumo  .New   Financing  In   1921    90 

Legal    Decisions    or    1921    .\IIecting    Invest- 
ments       )  138 

Legal   Decisions  on  Public   Finance   5C 

Loan  Company   Field,  The  Y'ear  1921   In   ..    80 

Miinlcliial  Ciovernment.  S<une  Anomalies  In.  103 
Municipal    Administration,    Some    Problems 
in     tie 


New   Companies   Incorporated   In    1921 
New  Financing  in  1921,  Large  Volume 


100 
99 


Oil     Results     Have      Been     DIsappolntlnr. 

Western 132 

Our  Trade  Opportunlly  on  the  PaclHc   122 

Past  Year  in  the  Investment  Field.  The....    83 
Po|)ulatlon  Has  Been  Disappointing,  Orowih 

or no 

Principal  Canadian   Bond  Sales  In   1921    lOli 

Piiiblcms  In   Municipal   A<lminisirallon tic 

Public    Flnanci',   Legal   Decisions   on    5< 

Railroad    Karnlngs,    Course   or    110 

Results    Have    Been    Disappointing.    West- 
ern   (jll ,..  .13* 

no.val  .Mint,   Production  01  .85 

Some    Anomalies    In    Municipal    (M.\irnmint  IW 
Sonii'    Lessons    From    the   Sloik    Kxchanges  112 
Some    Problems    m    .Municipal    Administra- 
tion       ||« 

Stock    K.xchange    Record    89 

Stock  Kxchange.  Some  Lessons  From   142 

Slock  DtTerings  Scarce   Last  Y'ear   lai 

Stock  .Markets.  Year  or  Hearllon  In   iw 

Tradi'   Opporliinlty  on   the   Pacific,   Our,    ,,  122 
Trial  or  the  City  .Manager,  A  Canadian tH 

I  lilted   states,   Can.ida's   Relations   with too 

Western    OH    Hcsulls    Have    Been    Dlsap- 


Koiployers'    Liability    Iiwuronfe,   T1i«  Year 

In <■. r.-; 

rire  and   Kmphiyers'   Liability  l.ih  < 

Fire  |n«nr,-iiire     t  r-fiDt    .iiwt  .    - 

Kin-  Hi 

Fire  It. 

Fir-  1 

Fi 

I' 

liroiip  in^iiranrp.  •.-  m.      .  !'>■ 

lirriwih    or    BurgI  1  .1*0    Bera 

'■■':  Ul     »» 

or    Inland    TraiutporlalMa    Boal- 

172 

Vf' 


i.iiaiaiiiee    Insuraiire   in    IWI    

Inmiigratloii     Ban     Ha«     Bern     fn'stlttfar- 

lory    

lidand  Tran-i 
Insurance  I.a\ 

i.irVnsos  Ktued  to  Canaila  Last  Yaar.  Im- 


Ir  ..-w    

Ii  |«»l    

Lit  :  ••gal    rxri.ii.ii* 

Life  lliiiuraiHt;    Law   In 

Lire  Insurance,    Rereni 

New   Developnieiils   in    Lleclriral    IH>«ki - 


Plate    Glass    Insurance    . 
Policy  Loans   Increased 

lleturned    Soldiers-    Inse' 

Some  F-»|>erlence   In  Or 

Slalutor'       ■ ■•    ■■ 

Steam     ! 
Sprlnkl. 


-.1 


190 


Tornado    Insurance 

Iniromi   Lire  ln»ur.ince   Law   m   '  ■ 

Y'ear  In  Employers'  Liability  Insnri 

ISOllfTtUM. 

Additions   to   Trade   Mark   La^^ 
Alberta    Wool    Shlpmenu    .. 
.Vulomoblle  Industry,   f^evelii  ' 

Brltl.sh   Columbia   Mineral   out.  ..: 
Building   Permits   and   Building   T- 

Canada    ■;imi....i.i..i    ir.m.- 
Coal    1" 
Crop    \  I 


D<'creas<'d    Prmlui :  .1    

Derelopmenl   In   A  Industnr    . 

Developments  In   llie   '.iimi    irilr    "    

I>on)lnlon    and    Provincial    Char: 
Lnder. 

Kleclrlral  Power.   New    I>     ■  ; 
Kssei   County   Tobacco   "  i-  , 

"iraln  Trade  In   I9S1.  Develoi  1 

lni|>orlanre   or    Irn-.  v\ 

Land    SeltlemenI    a;                  .    c.    .1 
legal    IVH:lsions    Allcrttus   ludtuUUi   Com- 
panies      

.Manurartiirlng  Had   Pinirull   Prrtc.' 
..Maritime   Provincis.  Oueliec   and 


■;■> 


Newfonndland    t>c\ 
Nova    Sctilla   Coal    ' 


polnling    tjs      Ontario's    Industrial    ArtiTit) 

Year  1921  In  Loan  Company  Field.  The  s,>       i-..«..r«     1  ,..i..r    ■>.....>..,..»     ,, 

Year  or  Reaction  In  Slock  .Markets 


INSIRVNCE 

Accideni    and    lleallh    Insurance    ISi". 

.\uiomobilo     Cndorwrllers     194 

.\utomnbllo    Insurance    Kxperlencv    184 

Burglary     Insurance    Growth     Has     Been 
Rapid    170 


Casnalt.v  Insurance  In   1921.  Survey  of 
Credit  and   Fire  liusurancc    


isa 


Death    Claims    In    in-.t 
Kxiiloslon   Insurance,   loiii   ^IM^ 


Pul|<  and  Paper  Industry  10  l«2l 

(Juebec  and  MarliUno  I'ro\ince» 

Railway    l>eveli>i<iu>nt<    During    tbe    r»»J 
Year    

$teel  Indusirr,  ReadiasUKMii 

Tanning  Industry   in   iwi    . 
Trade  Mark   Law.   Addill'-ns    : 

-tern   Canada.    E\)>an- 

PTodurlton 


THE      MONETARY      TIMES 


Volume  68. 


Index  to  Advertisements 


PAGE 

Acme    Securities    Corp.    I.KI.,    Toronto    133 

.\gricultural     Insurance     Co.,     Watertown, 

N.    Y 197 

Alberta,    Province    of    229 

.Me.\ander  Hamilton  Institute,   New  York..  217 

.Mian,    Killam   &   McKay,   Winnipeg-    141 

.\merican   Bank  Note  Company,  Ottawa   ...    71 

Ames  &  Company,  A.  E..  Toronto  li 

Anderson,   Robinson  &  Co.,  Toronto    11.5 

Hank   or   Hamilton,    Ilaniillon    6? 

Hank  of  Montreal,  Montreal   33 

Hank  of  New  Zealand,  Wellington,  N.  Z...    07 

Hank  of  Nova  .Scotia,  Toronto   55 

Heaver   Fire  Insurance  Co.,  Winnipeg   197 

Bell    Telephone    Company    of    Canada.    To- 
ronto     , 211 

Bond   and   Debenture   Corporation   of   Can- 
ada. Limited,   Winnipeg   .'. li:i 

Brandon   (City   of)    225 

British  America  Assurance  Co.,  Toronto  . .  171 
British  American  Bond  Corp.,  Vancouver..  139 
British  Canadian  Trust  Co..  Lethbridge  —  77 
British   Colonial   I'Ire   insuiance   Company, 

Montreal     203 

British    Columbia    Electric    Railway    Com- 
pany,  Vancouver   235 

British  Columbia   (Province  of)    233 

British     Columbia     Land     and    Investment 

Agency,  Limited,  Victoria   143 

British    Columbia    Permanent    Loan    Com- 
pany,   Vancouver     121 

Brook  and  Allison,  Regina   139 

Burgess  and  Company,  C.  H.,  Toronto  119 

Canada   Accident  and   Fire  Assurance  Com- 
pany.   Montreal    193 

Canada  Life  Assurance  Company,  Toronto  148 
(lanada   National   Fire   Insurance   Company, 

Winnipeg     191 

Canada  Security  Assurance  Co.,  Calgary...  195 
Canada  Standard  Loan  Co.,  Winnipeg  ...  143 
Canada  Trust  Co.  (Bond  Dept.),  Toronto  ..  115 
Canadian   and   General  Securities,   Limited, 

Winnipeg     109 

Canadian   Appraisal   Company,   Montreal    ..  131 

Canadian  Bank  of  Commerce,  Toronto   49 

Canadian  Debentures  Corporation,  Ltd.  ...  121 
Canadian  Financiers  Trust  Co.,  Vancouver  61 
Canadian   Guaranty   Trust  Co.,   Brandoa  ..    79 

Canadian  Pacidc  Hallway  219 

Casualty   Co.    of   Canada,    Toronto    187 

Clark  and  Martin,  Winnipeg  131 

Commercial  Life  .\ssurance  Company,   Ed- 
monton      171 

Commercial     Union     Assurance     Company, 

Limited,    Montreal    195 

Consumers'   Gas  Company,   Toronto   245 

Continental  Fire  Insurance  Co..  Winnipeg  179 
Crown  Life  Insurance  Company,  Toronto..  181 

Daly  and  Company,  R.  A.,  Toronto   119 

Dominion    Bank,    Toronto    65 

Dominion  Life  As.surance  Company,  Water- 
loo.   Ont 193 

Dominion    Loan    and    .Securities    Company, 

Limited,    Winnipeg    145 

Dominion     Securities     Corporation,     Lim- 
ited,   Toronto    1 

Kaglo,    Star    and    British    Donjinions    Insur- 
ance   Company,    Ltd.,    Toronto    247 

Eastern  Securities  Company,  St.  John..    ..  135 

Kdmonion    (City   on    237 

Eddy  Co.   Ltd.,   E.    B..  Hull    243 

Empire   Loan  Company,   Winnipeg   145 


PAGE 

Employers'  Liability  Assurance  Corpora- 
tion,   Toronto    193 

Evans  and  Company,  H.  M.  E.,  Edmonton..  139 

Excelsior  Life  Insurance  Co.,  Toronto   189 

Executors  and  Administrators'  Trust  Co., 
Ltd.,    Moose    Jaw    79 

ciens  Falls  Insurance  Co.,  Glens  Falls, 
N.    Y 248 

Goodwin,  Limited,  J.  H..  Calgary,  Alta 133 

Great-West  Life  Assurance  Company,  Win- 
nipeg       191 

Great-West  Permanent  Loan  Company, 
Winnipeg     145 

Greenshlelds   and   Company,   .Montreal    135 

Hamilton  Provident  and  Loan  Corporation, 

Hamilton    123 

Harris.  Forbes  and  Co..  Ltd.,  .Montreal  ..  2 
Home  Bank  of  Canada,  Toronto  75 

Imperial  Bank  of  Canada,  Toronto  53 

Imperial  Canadian  Trust  Co.,  Winnipeg  ...    79 
Imperial    Guarantee    and    Accident    -Insur- 
ance Company,   Toronto   197 

Independent  Order  of  Foresters,  Toronto.  187 
International   Loan   Company,   Winnipeg...  123 

Jarvls  k  Co.,  Aemillus,  Toronto   5 

Law   Union  and   Rock  Insurance  Company 

of   London,    England    175 

Leclerc,  Rene   T.,  Montreal   Ill 

Lethbridge,    (City    of)     221 

London  and  Lancashire  Insurance  Com- 
pany,  Toronto    175 

London  and  Lancashire  Guarantee  and  .\c- 

cident    Company,    Toronto    175 

London  Guarantee  and  Accident  Company, 

Toronto     1 

London  Life  Insurance  Co..  London.  Ont...  1.89 
London    Mutual    Fire    Insurance    Company, 

Toronto     173 

Lougheed  and  Taylor,  Calgary,  Alberta   ..  141 

Mackay-Mackay,    Toronto     117 

Mackenzie  and  Co.,  W.  A.,  Toronto  115 

.Mackenzie   &   Kingman,   Montreal    123 

MacINeill,  (iraham  k  Company,  Toronto  ..  135 
Manitoba  Farm  Loans  Assn..  Winnipeg  ...  143 
.Manitoba   Farmers'   Mutual   Hail   Insurance 

Company,    Winnipeg    179 

Manitoba,  Province  of   129 

.McCallum  &  Sherry,  Saskatoon   117 

Mcleod,  Young,  Weir  &  Co.,  Toronto  119 

McKlnnon  and  Company,  W.  L.,  Toronto..  119 
:\lercantlle  Fire  Insurance  Co.,  Winnipeg..  175 
.Mercantile     Trust     Company     of     Canada, 

Hamilton     39 

Merchants  Bank  of  Canada,  Montreal  73 

.Merchants   Casualty   Co.,   Winnipeg   177 

.Miniola    Farmers'    Mutual    Fire    Insurance 

Company.   Beulah,   Man 169 

Molsons     Bank     '. 00 

-Monarch  Life  Asurance  Co.,  Winnipeg  ...  183 
Montreal   City   and   District   Savings   Bank. 

Montreal 75 

Moose  Jaw,  City  of  K7 

Mount  Royal  .\ssurance  Co.,  Montreal   185 

Mutual  Life  and  Citizens'  Assurance  Com- 
pany.  Limited,   Montreal    183 

Mutual  Life  -Assurance  Company  ot  Can- 
ada,   Waterloo,    Ont 163 

.National  City  Company.  Ltd..  .Montreal   107 

National     Liberty     Insurance     Company    of 

America.    New    York    185 

National   Life   .\ssurance   Co..   Toronto    199 

National   Trust   Company,   Ltd.,  Toronto   ..    59 


P.\GE 

Nay  and  James,  Regina   117 

Nesbitt-Thomson    and    Company,    Montreal    133 

iS'ew   Brunswick    (Province   of)    241 

Northern  Life  .\ssurance  Co.,  London,  Ont.  181 
Northwestern     Life     Assurance     Company, 

Winnipeg     , 201 

Nova  Scotia   (Province  of)    113 

Ocean    Accident    and    Guarantee    Corpora- 
tion,   Ltd.,   Toronto    181 

Ontario    Equitable    Life    and    Accident    In- 
surance   Company,    Waterloo    199 

Ontario    (Province  of)    231 

Osier  and  Hammond,  Toronto   137 

Osier,  Hammond  and  Nanton,  Winnipeg  . .  137 

Palatine   Insurance   Company,  Montreal   ...195 

Pemberlon    and    Son,    Vancouver    Ill 

Portage    la    Prairie    Farmers    Mutual    Fire 

Insurance    Company    169 

Provident  Assurance  Company,  Montreal  ..  183 
Prudential  Insurance  Comi)any  of  America, 

Newark.    N.    J 161 

Prudential   Trust   Company,    Ltd.,   Montreal    6.3 

(Quebec  Fire  Assurance  Co.,  Quebec   175 

Regina,   City  of   (Financial  Statement)    127 

Ritchie   and  Ramsay,   Ltd.,   Toronto    241 

Royal  Bank  of  Canada,  Montreal   47 

Saskatchewan  Farmers'  Mutual  Fire  Insur- 
ance   Comi)any,    Saskatoon    171 

Saskatchewan   General   Trusts   Corporation, 

Limited,     Regina     59 

Saskatchewan  .Mortgage  and  Trust  Corpor- 
ation.   Ltd.,    Regina    77 

Saskatchewan    (Province   of)    125 

Saskatoon,  City  of  (Financial  statement)..  239 
Securities  Corporation  of  British  Columbia, 

Ltd.,    Vancouver 113 

Spamsh    River   Pulp   and   Paper   Company, 

Toronto 243 

Standard  Bank  of  Canada,  Toronto   63 

Standard   Mutual   Fire   Insurance  Company, 

Winnipeg     179 

St.   Cyr,   Gonthier  and   Frigon,   Montreal 131 

Sterling   omces.   Limited,   Toronto    185 

Stobie,   Forlong  and   Company,  Toronto    ..  135 
Sun    Life   Assurance   Company   of   Canada, 
.Montreal    105 

Tayloi    Safe    Works.    J.    J..    Toronto    75 

The   .Molsons    Bank.    Montreal    '69 

Toole,  Peet  and  Company,  Calgary  141 

Toronto  General  Trusts  Corp.,  Toronto  ...  .57 
Traders  Finance  Corp..  Ltd.,  Winnipeg  ..  109 
Traders  Trust  Company,  Winnipeg  73 

Union   Bank  of  Canada,   Winnipeg    51 

Union  Fire  and  Casualty  Co.,  Winnipeg  . .  177 

Union  Trust  Company,  Ltd.,  Toronto   61 

United      Financial     Corporation,     Limited, 
Montreal     82 

Wawanesa     Mutual     Insurance     Company, 

Wawanesa,   Man 187 

Western   .\ssurance   Company,   Toronto    ...  203 
Western  Empire  Life  Assurance  Co.,  Win- 
nipeg      169 

Western   Homes,   Ltd.,   Winnipeg    123 

Western  Life  Assurance  Co..  Winnipeg  ..  167 
Winnipeg    (City   Light   and  Power   Dept.)..  206 

Winnipeg  Electric   Railway,   Winnipeg   223 

Wood.   Gundy   and   Company,   Toronto    24 

Woods.    Ltd.,    Walter.    Hamilton    243 

Yorkshire    and    Canadian    Trust,    Limited, 
Vancouver    77 


Index  to  Contributors 


PAGE 
AISTEX,    (J.    W.,   TOnONfO— 
Land    Setllrment   and    Immiyratlon    liG 

ItAilKER.  A.   B..  TOHONTO— 

Itevlen'  of  Canadian  Banklnii  in  1921   33 

Hankers'  Association  Educational  Courses. .    38 

BELL,     HON-     .1.     H.,     CIIAULOTTETOWN— 
Hessaqo    from    Prince    Edward    Island 26 

BRAGG,    HARRY.    MONTREAL— 
Some  Problems  in  Municipal  .\dniinistralIon  IIG 

BURGESS,    C.    11.,    TORONTO— 
The    1921    Bond    Itlarket    GO 

CAIES,   W.   C...   OTTAWA— 

Trade   Decline    a    Significant    Factor    16 

ClllCANOT,     E.     L.,    MONTREAL— 

ImmljiralJon   Ban   Has   Been    Unsatlsfaclory  166 

DOWER.    .1.,    FORD,    ONT. 
Five    Decades    ot    Borrowing    In    Rrllaln...  lO'i 


PAGE 
DRUMMOND,    A.    T.,    KINGSTON— 

Growth    or    Population    Disappolnllng    110 

New    Development    in    Electrical     Power... 174 
DRURV,    HON.    E.    C,    1 ORONTO— 

Messane    from    Ontario       25 

EDMONDS.    W.    L..    TORONTO— 

Past   Year   In   the   Mortgage   Loan   Field    . .    8G 
Jlanufaeturing     Has    Had     DimcuU     Period  207 

GREENFIELD,     HON.    C.    H.,    EDMONTON— 

Message     from     All>erta     26 

HARPEK,   O.   A.,  WINNIPEG— 

Provinces'    Invasion   of    Ihe    Banking    Field    23 

.1ACKMAN,    \V.    T.,    TORONTO— 

Railway  Developments  during  the   Past   Year    19 
Growth   of   Rural   Credits   in   Canada    66 

LAURISTON,      VICTOR,      CHATHAM,      ONT.— 

A   Canadian   Trial   of   the   City   Manager 12i 

Western    Oil    Results    Disappointing     132 


SIARTIN,   HON.   W.    M..    REGINA— 
Message     from     SaskatcJiewan     


P.\GE 


S3 


MORTLEV,    RANDOLPH    S.,    TORONTO— 
Recent  Developmenis  in  Casually  Insurance 

SCLATER,   A.   G.,    NEW   YORK— 

Canada's   Relations   with   United   States    ...  106 

— SIIORTT,  DR.  ADAM— 

Past  Year  in   the   hn  eslmeni  Field    — 
STOKES,    CHARLES    W..    MONTKEXL  - 

Some  Weaknesses  in  Canada's     Development     10 

TOWERS.    GRAHAM    F.,    MONIREAL- 
Canadian   Banks   In    the   Foreign   Field    . .      i'l 

WATTS,    JOHN    S.,    NEW    GLASGOW— 

Some    Lessons    from    the    Stock    Exchanges  112 

YORATH,    0.   i..   EDJIONTON— 

Some  Problems  in  Municipal  Adminlslralion  116 


January   G,   1922. 


THE       MONETARY       TI.MKS 


cean 


■^s---. 


I 


N  every  Province  in  Canada  we  have  bought,  underwritten  and  sold  Government,  Muni- 
cipal or  Railway  Bonds  guaranteed  by  the  Government.  During  three  decades  Aemilius 
Jarvis  &  Co.,  Limited,  year  by  year  has  grown  in  public  confidence  and  in  clientele. 


From  ocean  to  ocean  the  mall,  the  telegraph 
and  telephone  daily  pour  into  this  house  the  orders 
of  clients  who  know  that  with  us  their  Interests 
are  safe. 

This  nation-wide  business  connection  has  been 
established  by  rigid  adherence  to  an  inflexible  rule 
of  "safety  first"  in  all  investments  recommended 
to   clients.   No   bond   issue   is   ever  accepted   or   re- 


commended until  a  thorough  and  expert  examina- 
tion of  the  assets,  debts  and  sinking  funds,  reT)>- 
nues,  assessment  values,  borrowing  powers,  legal 
ity  of  authority,  validity  of  agreements  and  all 
other  facts  pertinent  to  the  security  of  the  prin- 
cipal, has  been  made.  When  we  recommend  an 
Investment  you  can  be  absolutely  assured  that  it 
is  a  safe  security  to  buy. 


1922  Investment  Situation 


Not  so  simple  or  easy  as  it  has  been  in  1921, 
when  highest  grade  bonds  could  be  bought  to  yield 
i;  per  cent,  or  better. 

Today  money  Is  easier,  interest  rates  are  de- 
clining, and  more  money  is  seel<ing  investment. 
I'nder  these  conditions  high-grade  securities  In- 
variably advance  in   price  and  yields  are  reduced. 

Indications  are  that  this  condition  will  con- 
linue.  If  times  become  good,  indus^trles  active 
und  business  normal,  interest  rates  are  bound  to 
decline  and   high-class  securities  to   advance. 


We  believe  this  will  be  the  outstanding  feature 
of  the  situation  in  1922.  We  believe  good  times 
are  here,  that  business  will  revive,  that  Industrte* 
will  take  on  new  life  in  1922,  and  that  we  will  •«« 
advances  In  prices  of  all  good  securities. 

Our  advice,  therefore.  Is  to  buy  now. 

In  our  list  we  have  a  large  variety  of  guaran- 
teed railway  bonds  and  rrovinrlal  and  municipal 
bonds  of  varying  maturities  and  at  yields  that  are 
very  attractive.  We  recommend  the  issues  in  oar 
list,  which  we  will  gladly  send  you  on  request. 


arvis  &  Co. 


tJarvis    Building 
103  Bay  St.j-e«t., 

Toronto,  Canada. 


LIMITED 


liTASllSHCO 
1S91 


London.EC2.  F.ii^ 
Ottawa.  Canada 


INVESTMENT  BANKERS 


THE      MONETARY      TIMES  Volume  68. 


A.E.  AMES  &  CO 


Established  1889 


Members  Toronto   Stock   Exchange 
Members   Montreal  Stock  Exchange 


CANADIAN 

Government,  Municipal  and 
Corporation 

SECURITIES 


WE   INVITE  CORRESPONDENCE 


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of  Onada,   !,imin-'it 

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Trade  Review  and  Insurance  Chronicle 

of  (TanaDn 


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Old  :is  Confederation 


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SecrtUr 


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Ti'lrphonr:  Main  7i01,  Hriincli  KxihahKi^  conncctliiif  all  ilcparlmenli. 
Ciihli'   \(l<lrp>-s:    'Montliiics,  ToicinCo." 

IVcstcin    raiiiulii    0ITl(c~-l2(W    McArllnir    nidg.,    Winnipeg.     Telephone 
Main   :ii(i'J,       Ufoi-Ke    \V.    floodall,    Wrslern   Mana(fi'i\ 


si'iis(.Kir>ri(>\  nvTKS: 

one    Year 

six   Months 

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ADVEnriSING    II.XTKS    UPON    HEQUEST 

The   Moni'taiv   Times   was   eslahllshiMl   In   1SC7,   ihe   year  of  Con- 
rcdeiatlon.     It   absorhed,   In   18i)9,  The   Iniercolonlal   Journal  of  Com_ 


nmiii',  of  MoiiIiKal;   In    l"'ii,    flu-   Tradr    llenrw 
Toronto  Journal  tit  r.oMiTn''trf. 

Tlic  Monetary  Times  floe-i  not  necetsanly  i-: 

or  o|  inlons  or  Us  rorn-spoii(|pnl!t,  ixir  iKx-s  II  Itoiil  Il9«ir 
therefor. 

The  Monetary  Times  Invites  Informiiion  fr-.i..   n.   ri-, 
In    ejcliKllnic    froin    lt.<    colninnH    fr.-iiiiliilem     i- 
vertlsements.    All  Inrormillon  win  be  treated   ■ 

SlBSr.RIDKKS   Pl.llASe   NOTE: 

When    i-hanitInK     vour    iiiailliiir     instrurtioiii.    In 
fullv  both  your  ■ '        ••    ■     •'•'■- 

.Ml  inalleil 
subscriber  who 
plalnlnir  to   the  iiiii:iin' ,.i.  lu;':..,   ■,•...:- 


The  Year  1921 — Retrospect  and  Prospect 

Rapid  Fall  in  Price*,  Accompanied  by  Stagnation  in  Business, 
Was  Feature  of  Year  —  How  Financial  Activities  Were 
Affected — Much  of  War-time  Inflation   Has  Been   Removed 


■ii- 


THREE  years  after  the  signing  of  tlie  armistice  there 
is  still  talk  of  reconstruction  and  re-establishment  In 
Canada.  But  while  talk  of  this  kind  has  been  going  on, 
the  real  work  of  reconstruction  has  been  accomplished, 
not  by  government,  but  by  private  industry.  So  far  as 
Canada  is  concerned,  the  term  meant  nothing  more  than 
the  substitution  of  peace  influences  for  those  of  war. 
The  only  war  influences  that  now  remain  are  those  which 
will  be  with  us  for  an  indefinite  time,  such  as  interest  on 
debt,  pensions,  and  the  partial  demoralization  of  currency 
and   exchange. 

But  while  this  country  has  resumed  its  normal  line  of 
development,  the  conditions  under  which  we  start  aro  dif- 
ferent from  those  obtn-n'np  when  we  left  off.  The  period 
from  li)14  to  1920,  inclusive,  was  not  merely  a  hiatus  in 
Canada's  economic  history,  but  was  rather  a  period  in  which 
outside  factors  disarranged  our  affairs.  The  war  left  not 
only  some  new  factors  in  business  life  but  changed  the 
actual  organization  by  which  business  is  carried  on. 

As  wc  have  already  passed  through  the  stages  of  war 
and  post  war  inflation,  and  the  inevitable  re-action,  the 
present  may  be  a  fitting  t'me  to  esixmine  how  we  stand  as 
compared  with  1914.  In  this  connection  it  mu«t  be  bom  in 
mind  that  the  latter  year  was  one  of  reaction  from  the 
period  of  prosperity  which  culminated  in  191.3.  Th' 
dcveloi)ment  which  we  are  resuming,  therefore  is  a  develop- 
ment marked  by  declining  prices  and  busines-.  contraction. 
The  war  turned  the  tide  violently  in  the  opposite  direction 
but  the  reaction  from  the  war  will  be  all  the  more  pro- 
nounced and  prolonged  beciuse  of  its  coincidence  with  our 
normal  course  of  development. 

Commodity  Price.s 

The  rebtion  of  commodity  price.s  at  present  to  those 
prevailing  before  the  war  is  'llus' rated  bv  the  following  in- 
dex numbers  of  wholo-^ale  prices  compiled  by  the  Canidian 
Department  of  Labor  : — 

October,  1913  October.  1921 

Grains  and  fodders   138  0  174..'? 

Animals  and  meats    179  4  240.'2 

Dairy    products     164.8  229.0 

Pish    148.0  ISO.) 


Fruits  and  vegeteblee  112.2  2MJ8 

Miscellaneous  groceries    ...  113.8  186.9 

iextilea     ...  137.4  2-U.C 

Hides,  leather,  boots  and  shoes   165.6  163.6 

Metal  and  implements   11S.8  193.5 

Fuel  and  lighting  117.6  248* 

Building    materials    143.8  t79S 

House  furnishings   128.1  314.0 

Drugs  and   chemicals    llfcS  191.5 

Miscellaneous 152.4  SOCS 

All  commodities    134.6  229.2 

When  it  is  remembered  that  the  index  number  of  all  oom- 
modities  reached  3.'>6.6  in  May,  V.-20  the  wdent  of  tiw  de- 
cline which  had  taken  place  by  October,  1921,  is  evident.  It 
is  also  apparent  how  raw  materials  have  come  down,  hides 
and  leather  being  actually  below  the  level  of  eight  years  ago. 
.  The  months  immediately  following  the  armistice  found 
business  in  a  state  of  uncertainty.  Then  came  a  year  of 
unparallelled  activity,  ending  in  the  spring  of  1920.  The 
remainder  of  1920  'U'as  a  critical  period,  but  was  safely  pass- 
ed over  as  regards  business  as  a  whole.  The  year  1921. 
therefore,  may  be  regarded  as  the  first  year  since  1914  n 
which  economic  life  was  controlled  by  normal  factors.  The 
actual  low  wiiter  mark  of  business  was  reached  about  last 
June,  but  even  then  some  indu.«tries  had  passed  this  stag*. 
Almost  every  industrj'  has  by  this  time  had  its  slump  in 
prices,  followed  sometin-es  Vy  a  sli-rht  reaction,  but  sooner 
or  Inter  by  a  nore  gradual  downwsrd  rootvement. 

Agricul'u'e 

Ju?t  a';  the  products  of  th?  fam\  the  forest  and  the 
mine  were  the  first  to  rdvance  during  the  war,  so  also  hav* 
they  been  the  first  to  go  down.  1921  ha«  '> '•  n  c-ne  of  the 
wo- St   years   ever   experienc«l    by  the    f:i  '    Canada. 

Th"  nrJces  of  their  products  had  gone  1  .  v  to  pre- 

war levels,  but  their  co'ts  had   shown   1  tion.     It 

was  fortunate,  t!K>refort>.   that  (••""•  -  "•  '■  •    1921,   the 

reduction  in  value.j  being  to  soi-  i-  made  op  by 

quantity  of  output.     N'ovortVi.^i.  - r.  of  the  fann- 
ers was  a  serious  one.  an<i                 <  had,  in  their  own  is- 


,-..cf       t,^ 


»I,„ 


THE       MONETARY       TIMES 


Volume  68. 


In  view  of  this  situation,  the  farmer  could  no  longer 
pay  the  high  wages  of  war  time,  and  what  he  could  offer 
did  not,  in  many  cases,  induce  workers  to  leave  the  cities 
where  employment  was  uncertain  but  a  livelihood  assured. 
The  farmers  also  lost  no  time  in  marketing  their  grain  and 
stock,  fully  the  trend  of  prices. 

The  actual  volume  of  grain  production  for  the  whole  of 
Canada,  in  comparison  with  1920,  is  estimated  as  follows  : — 

(Bushels) 
1920  1921 

Fall    wheat    19,469,200  15,473,000 

SprinpT  wheat   243,720,100         278,914.800 

All    wheat    263,189,300        294,387,800 

Oats     5.30,709,700         466,303,100 

Barley     63  310,550  57,607,300 

liye     11,306,400  11,847,500 

■f'lax     7,997,700  7,166,300 

Mining 

In  the  mining  field  we  find  the  same  influences  at  work. 
Almost  all  the  war  time  advances  in  the  price  of  metals  hav- 
ing been  lost.  Even  though  some  reductions  in  wages  and 
other  mining  costs  were  effected,  the  year  was  a  dull  one 
Production  of  the  coal  mines  of  tiie  Dominion  during  the 
first  six  months  of  the  year  was  only  86  per  cent,  of  the 
production  during  the  same  period  last  year,  while  the  situ- 
ation in  the  more  important  branches  of  mining  is  shown 
by  the  following  figrurer;  of  Ontario  production  for  the  first 
six  months  of  1920  and  1921:— 

(Values  in  dollars.) 
1920  1921 

Gold    $  5,690,504       $  5,761,504 

Silver     5,077,028  2,552,125 

Ck)pper,    metallic    470,949  272,132 

Nickel  in  matte    5,338,120  '407  000 

Iron,    pig    738,079  733,568 

Cobalt,   metallic    266,045  91,355 

Cobalt,    oxide    645,783  204  853 

Nickel,    oxide    814,070  65,652 

Mickel,   metallic    1,696,687  1,479 

"^^^^     22,101,580         11,363  652 

Oil  developments  in  the  west  created  quite  a  stir  during 
1921,  most  attention  being  directed  towards  northern 
Alberta.  Thus  far  profitable  results  have  been  secured  only 
In  rare  instances. 

Lumbering. 

Products  of  the  forest  also  suffered  a  severe  price 
decline.  It  is  expected  that  the  output  during  the  present 
■winter  will  be  smaller  than  for  many  years  past,  and  opera- 
tions would  have  been  even  more  restricted  had  it  not  been 
for  wage  reTluctions.  Export  business  also  came  to  the  rescue 
of  lumber  firms  operating  on  the  Atlantic  and  Pacific  coasts. 
This  is  of  special  importance  to  British  Columbia,  which 
exports  about  half  its  output,  the  United  States,  Japan, 
China  and  Australia  being  the  principal  customers. 

The  companies  operating  in  the  eastern  provinces  will, 
it  is  expected,  be  able  to  operate  this  winter  at  about  60  per 
cent,  of  the  cost  last  winter.  Added  to  this  is  an  increase  in 
wo^k=n-  '-fl^ciency,  due  to  the  surplus  of  labor. 

On  the  other  hand,  fishing  has  had  a  very  fair  year. 
Supplier;  on  the  east  coast  were  abundant,  the  Newfoundland 
catch  being  one  of  the  best  in  its  history.  On  the  whole, 
however,  production  was  less  than  in  1920,  the  output  during 
Auarust  for  the  whole  of  Canada,  being  estimated  at  776,677 
cwt.,  valued  at  $3,043,461,  compared  with  1,005,884  cwt., 
valued  at  ii!3.467,137  in  August,  1920. 

One  o^  the  factors  tending  to  a  reduction  in  our  fisheries 
output  ;s  thcit  the  Fraser  River,  British  Columbia,  is  almost 
exhausted  as  a  salmon  fishing  area. 

Furs. 

The  fur  market  having  already  experienced  its  reaction, 
the  year  was  a  normal  one.  Auction  markets  are  now  operat- 
ing in  Winnipeg  and  Montreal,  and  sales  conducted  during 
the  year  found  demand  good   but   no  great  change  in  prices. 

Reflecting  the  state  of  business  generally,  railway  traffic 
has  been  considerably  below  1920.  Gross  earnings  of  the 
three  roads  in  October  were  as  follows  : — 


October  1920        October  1921 

Canadian  Pacific   $24,787,000  $21,893,000 

Canadian    National   12,351,157  11,691,881 

Grand    Trunk   11,666,798  9,743,332 

Apart  from  this  change,  the  year  was  not  eventful  for 
the  Canadian  Pacific,  as  it  has  been  able  to  reduce  operating 
expenses  nearly  as  quickly  as  gross  earnings  went  down. 
The  Canadian  National,  after  the  staggering  deficit  shown 
in  the  report  for  the  year  ending  March  31  last,  has  during 
the  past  few  months  shown  an  improvement,  gross  earnings 
now  being  in  excess  of  operating  expenses,  though  the  sur- 
plus is  still  small  compared  with  the  heavy  fixed  charges. 

Developments  in  connection  with  the  Grand  Trunk  were 
the  most  important  in  the  railway  field.  A  transfer  of 
control  to  a  board  appointed  by  the  government  was  made. 
The  award  of  the  board  of  arbitrators  was  also  declared, 
though  an  appeal  which  has  been  entered  by  the  shareholders 
will  still  further  delay  the  final  settlement  of  this  transaction. 

Water  Transportation. 

Ocean  traffic  also  fell  off  in  1920,  competition  being 
keen  and  rate  cutting  frequent.  This  means  reduced  earnings, 
and  ships  built  at  high  costs  are  not  proving  a  profitable  in- 
vestment. Grave  doubts  have  arisen,  therefore  as  to  the  out- 
come of  the  Canadian  government's  investment  in  the  mer- 
cantile marine.  The  showing  of  the  last  fiscal  year  was 
satisfactory,  but  the  report  for  the  present  year  will  be 
awaited  with  interest  bordering  on  anxiety.  If  these  ships 
were  to  be  sold,  a  very  heavy  loss  would  be  incurred.  On  the 
other  hand  if  they  are  retained  and  operated  at  a  loss,  it  is 
felt  that  this  would  be  merely  another  method  of  subsidizing 
the  mercantile  interests  of  the  country. 

Traffic  on  inland  waters,  as  reflected  by  the  business  of 
Canada  Steamship  Lines,  Limited,  the  largest  concern  in  the 
business,  was  sustained  in  good  voliime.  One  of  the  features 
of  the  year  was  the  ereat  expansion  of  traffic  on  the  routes 
leading  to  the  oil  fields  of  northern  Alberta. 

Manufacturing  has  been  exceedingly  dull  during  the 
past  year,  as  the  "consumers'  strike"  commencing  last  year 
soon  brought  a  cessation  of  orders.  Many  plants  shut  down 
for  a  cnsiderable  period,  while  there  were  scarcely  any  which 
were  fully  occupied.  Much  money  had  been  lost  by  manufact- 
uring surplus  stocks  which  quickly  declined  in  value,  and 
consequently  there  was  a  tenf'rri"v  riurin"  the  past  year  to 
hold  off  operations  until  a  demand  was  definitely  in  sight. 

Another  factor  which  discoura.ged  manufacturing  enter- 
prise was  the  aggressiveness  of  the  t.ariff  reduction  party, 
which  mieht.  by  all  appearances  be  returned  to  power  at 
the  federal  elections  held  in  December.  Nevertheless  some 
new  plants  were  opened,  indicating  confidence  in  the  return 
of  a  demand  for  goods  and  in  the  permanence  of  a  protective 
tariff  as  a  factor  in  Canadian  economic  life. 

Wholesale  and  Retail  Business. 

It  was  the  wholesale  and  retail  firms  which  first  felt  the 
brunt  of  the  "consumers'  strike".  As  soon  as  the  falling  off 
in  demand  became  apparent,  retailers  centered  their  efforts 
on  reducing  their  stocks  without  a  loss.  They  were  partially 
successful,  but  many  were  obliged  to  sell  below  actual  cost. 
Consequently  failures  were  numerous  during  the  past  year. 

Wholesale  houses  felt  the  depression  most  keenly  about 
the  spriniT  o^"  1921  because  by  that  time  retailers  were  thor- 
oughly frightened  from  placing  new  orders.  There  was  a 
minimum  of  buying  which  had  to  be  done,  however,  and  later 
on  in  the  summer  retailers  were  forced  to  buy  to  replace 
depleted  stocks.  Consequently  the  end  of  the  year  finds 
stocks  of  both  retailers  and  wholesalers  at  a  minimum,  with 
business  improving  and  prices  showing  a  tendency  not  to 
advance  but  to  become  more  steady. 

Loan  and  Trust  Companies. 

Apart  from  the  diflnculty  of  raisin?  money  by  the  sale 
of  debentures,  which  has  been  felt  for  the  past  five  years, 
loan  companies  have  had  a  good  year.  Deposits  kept  up 
fairly  well.  Trust  business  does  not  depend  so  much  on 
temporary  cond-tions,  but  no  falling  off  ?'n  business  has  been 
experienced,  thoi^gh  the  small  amount  of  new  corporate 
financing  has  restricted  this  branch. 

Closely  linked  with  the  loan  and  trust  companies  is  the 
mortgage  loan  field,  as  they  supply  a  good  part  of  the  funds 
for  investment  in  this  way.   Rates  have  been  at  a  high  level 


January   6,   1922. 


THE      MONETARY      TIMES 


during  the  past  two  years,  ranging  from  6V4  p«r  cent.  to7V4 
per  cent,  for  choice  city  property,  to  8%  and  9  per  cent  for 
less  desirable  western  mortgages. 

Banking  Business. 

As  might  be  expected  from  this  situation,  banking  busi- 
ness has  contracted  during  the  past  year.  This  may  be 
illustrated  by  the  following  figures  : — 

September  1920         September  1921 

Holdings  of  coin $      81,037,676  %      77,908,368 

Holdings  of  notes    173,772,522  173,658,961 

Deposit  in  central 

gold  reserve    109,012,533  70,302,533 

Cheques  on  other  banks  .  .       146,671,334  107,233,818 

Government    securities   ..         110,287,730  180,214,310 

Municipal  securities,  etc.         202,349,860  135,085,779 

Call  loans  in  Canada   114,669,011  106,729,270 

Call  loans  elsewhere 186,962,900  183,290,756 

Current  loans  in  Can.    ..     1,417,520,756  1,239,637,351 

Loans  to  municipalities  . .  78,103,364  83,851,274 

Total    a-isets   3,140,014,769  2,802,532,030 

Capital  paid  up 126,927,040  129,268,517 

Circulation     231,094,885  186,797,922 

Bal.  duo  Dom.  Govt 156,410,480  96,689,442 

Demand  depo-sits  in  Can.         677,286,905  534,307,4.52 

Savings  dctposits  in  Can.         270,194,097  1,263,763,852 

From  this  comparison  it  is  apparent  that  the  substantial 
reduction  which  has  taken  place  in  loans,  due  to  the  slack- 
nes-^  of  commercial  business,  has  been  reflected  in  demand 
rather  than  ii.  current  deposits.  The  latter  are  on  the 
decrease,  however,  but  do  not  react  so  quickly  as  do  demand 
deiposita. 


While  it  ia  frequently  aaaert«<l  that  the  twaks  bav« 
eocaped  the  Iomm  consequent  to  a  btuinew  reeeMioB,  and 
recent  annual  reporta  show  their  profiU  to  have  beCB  WtU 
maintained,  this  is  not  altogether  the  case.  The  bank*  hare 
as  a  matter  of  fact  had  a  hard  time  wat*-hing  their  weaker 
accounts,  and  losses  have  at  times  been  incurred.  The  fact 
that  they  have  come  out  to  well  is  due  in  lar^  deirree  to  the 
conecrvative  policy  adopted  in  1920. 

Bond  and  Stock  MarkeU. 

Issues  of  the  provincial  govemmenta  and  of  the  larger 
cities  were  most  prominent  in  the  bond  fi'-M  'ri,..r..  »«.,,  no 
Dominion    government    loan,    and  the  sm..  tie* 

were    frightened    by    th»    higher    rates    pr „.        .'rices 

maintained  their  low  levels  until  quite  late  in  the  year,  when, 
about  the  middle  of  November,  a  sudden  rise  in  t^i.  r,r  . .  ,,f 
government  bonds  took  place,  followed  by  a  str. 

other  issues.     It  is  thouf^ht  that  the  great  amou;..     .   , 

cial  issues  floated  had  kept  back  this  movement  until  so  late. 
The  provinces  are  now  pretty  well  provided  for.  but  a  Dom- 
inion government  loan,  and  a  good  amount  of  smaller 
municipal  issues,  one  expected  during  the  coming  vear. 

Insurance. 

Life  insurance  companies  had  scarciiy  f»j)e<u-<i  that 
they  could  maintain  the  records  establi.<he<l  in  1920,  and  as  a 
matter  cf  fact  their  new  business  in  1920  was  considerably 
behind  that  for  the  previous  year.  On  the  other  hand  clahns 
were  light,  and  the  inveptrrent  or •• 'ies  good. 

The  volume  of  fire  in.'uranc  also  fell  off,   and 

aslosees  were  heavy,  the  year  wa-  ....  .,  .;.>od  one  in  this  line 
Casualty  insurance  results  were  varied,  with  specially  heary 
losses  in  burglary,  automobile  and  theft  insurance. 


Business  Indices  Show  Year's  Developments 

Principal  Movements  of  Trade  and  Finance  Graphically  Illustrated — Year  1921 
Was  One  of  Reaction  from  War-time  Expansion  Which  Culminated  in  1920 


CANADIAN  business  during  the  past  eighteen  years  is 
illustrated  by  tlie  accompanying  chart,  compiled  by 
Babson's  Statistical  Organization,  Wellesley  Hills,  .Massa- 
chusetts. The  black  areas  are  obtained  by  plotting  the 
monthly  Canadian  Value  of  Business  Index.  The  Index 
is  a  combination  of  indices  of  the  following  suojects:  Bank 
Clearings,  Failures,  Immigration,  Foreign  Money  Rates, 
Montreal  Money  Rates,  Ratio  of  Cash  to  Net  Liabilities, 
Commodity  Prices,  Share  Prices  Railroad  Earnings  and 
New  Building. 

The  line  X-Y  represents  the  country's  net  gain  or 
growth.  The  chart  is  based  on  the  economic  theory  that 
"action   and   reaction  are  equal."      On  this  basis,  each  area 


above  the  line  X-Y  r:ust  be  followed  by  nn  area  of  thv  s  I'ne 
size  below  the  line.  Hence  we  expect  Area  (J  toequ.-il  .\rea  K. 
the  same  as  Area  E  equbUed  Area  D,  and  Area  C  equalled 
Area  B. 

The  line  marked  "i-tocks"  represents  the  average  trend 
of  the  stock  market  from  1904  to  1912.  It  wae  based  upon 
average  prices  of  one  rail,  four  public  utilities  and  five  indus- 
trial stocks.  From  1912  to  date  twenty  industrial  stocks  were 
added  to  the  list. 

To  use  this  Babsonchart  in  connection  with  one's  own 
businesd,  the  observer  should  chart  his  own  sale*  tbercoa 
and  note  what  portion  of  the  represented  areas  has  been 
consumed  when  his  own  sales  were  the  greatest  or  sntallest. 


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10 


THE      MONETARY      TIMES 


Volume  68. 


Some  Weaknesses  In  Canada's  Development 

Recent  Depression  Has  Been  Difficult  Time  for  Ill- 
judged  Enterprises — Progress  of  Industry  Must  Be  Sound 
and   in  Proportion  to   Country's  General   Development 

By  CHARLES  W.  STOKES 


•T'HIS  is  not  a  statistical  article.  From  its  title  it  per- 
*■  haps  -should  be — and  it  would  then  be  much  easier 
to  write,  for  statistics  are  so  unassailable  that  often  they 
confute  the  processes  of  logic. 

There  is  a  chronic  disease  from  which  practically  every 
North  American  suffers  in  greater  or  less  degree,  and  which 
— with  all  due  regards  to  Frank  Yeigh  and  his  useful  little 
publication— might  be  called  the  disease  of  "Five  Thousand 
Facts  About  Canada."  The  North  American,  of  course,  is 
not  considered  provincial  or  uncultured  if  he  knows  a  great 
many  more  statistics  than  the  European,  who  knows  few. 
One  could  ask  the  Englishman  the  familiar  old  question 
that  we  love  so  much — the  area  of  England,  the  population 
of  Manchester  as  compared  with  Birmingham's,  the  length 
of  the  London  and  North-Western  Railway,  how  much  in- 
come-tax Sir  John  Ellerman  pays,  how  high  St.  Paul's 
Cathedral  is,  and  what  the  Savoy  Hotel  cost — and  the  only 
answer  would  be  a  dumb-founded  silence.  That  kind  of 
knowledge   simply  isn't  "done"  there. 

Use  of  Statistics 

On  this  side  statistics  are  one  of  our  commonest  forms 
of  spiritual  expression.  They  belong  with  expanding  acre- 
age, incoming  settlers,  rising  land  values,  and  steel  sky- 
scrapers. The  smaller  the  place,  the  louder  the  statistics — 
the  bigger  the  place,  the  more  complacent.  We  are,  indeed, 
becoming  so  much  of  a  continent  of  statisticians  that  we 
are  all  individually  tending  to  become  lecturers;  a  single 
well-placed  statistic  can  (to  apply  a  metaphor  of  Oliver 
Wendell  Holmes)   wreck  a  whole  freight  train  of  thought. 

The  trouble  is  that  three-quarters  of  the  time  we  don't 
know  what  the  statistics  mean — at  any  rate,  what  they 
imply.  Let  us  consider,  for  example,  the  coal  problems  of 
this  country.  Canada  is  stated  on  unimpeachable  authority 
to  have  approximately  one-sixth  of  the  known  and  estimated 
coal  deposits  of  the  world.  Isn't  that  good  news?  Isn't  it 
wonderful?  Doesn't  it  make  you  want  to  give  three  rous- 
ing cheers?  When  you  remember  that  Great  Britain  has 
only  about  one-eightieth  of  the  known  and  estimated  coal 
deposits  of  the  world  and  yet  has  become  one  of  the  greatest 
manufacturing  countries,  doesn't  Canada  appear  to  have 
an  awfully  brillant  future? 

Example  of  Coal 

"Well,"  says  the  knocker,  "if  Canada  has  so  much  coal 
why  does  it  import  so  much  every  year  Why  is  it  that 
during  a  recent  winter  it  faced  an  actual  coal  shortage,  and 
put  itself  upon  rations?" 

The  answer  is  simple,  but  unsatisfactory.  The  coal  is 
there,  but,  unfortunately,  is  not  where  most  people  want 
it.  Nature  did  not  foresee  that  more  people  would  want 
to  live  in  the  middle  of  Canada  than  at  the  ends,  and  fool- 
ishly deposited  nearly  all  the  coal  at  the  ends.  While  Can- 
ada was  gi-owing  that  did  not  matter  much;  but  now  that 
Canada  has  resolved  to  be  a  really  important  manufactur- 
ing country — which  means  to  intensify  its  existing  areas 
— it  is  confronted  by  the  economic  law  that  industrial  pro- 
duction invariably  moves  up  close  to  the  coal  areas. 

Hydro-electric  Power 

Obviously,  therefore,  if  Canadian  industry  had  not 
hydro-electric  power  to  fall  back  upon  it  would  within  a 
fairly  anticipable  number  of  years  remove  itself  to  Cape 
Brtton  Island,  Western  Alberta,  or  Vancouver  ^sland — or 
allowing  for  another  geographic  law,  to  some  region  easily 
reached  from  the  coal  mines  by  water  transportation,  which 
would  cut  out  the  Crow's   Nest   Pass     But  central   Canada 


has  enoi-mous  hydro-electric  power.  The  provinces  of  Quebec 
and  Ontario  have  an  estimated  minimum  of  eight  and  a  half 
million  24-hour  horse-power  available;  the  Dominion  has, 
according  to  the  same  authority  (the  Water-Powers  Branch 
of  the  Department  of  the  Interior),  water-power  possibili- 
ties of  nearly  eighteen  million  24-horse  power — equal  to  153 
million  tons  of  coal — of  which  scarcely  ten  per  cent,  is  as 
yet  used. 

Once  more,  let  us  rise  up  truculently  and  bid  the  world 
defiance  in  three  reverberating  cheers.  But — oh,  confound 
him,  what's  he  going  to  "but"  now?  Only,  however,  to 
remark  in  a  mild  and  placatory  tone  that  we  have  misled 
ourselves  so  often  previously  with  startling  statistics  of 
this  kind  that  it  might  be  well  to  investigate  where  these 
immense  water-powers  are.  You  don't  go  out  into  your 
back-yard  and  pick  up  a  horse-power  lying  around  promis- 
cuously, and  forthwith  start  a  factory  with  it — or,  if  you 
are  a  community,  invite  an  industry  from  the  States  to 
come  in  and  locate  with  you.  You  don't  have  to  be  an 
electrical  engineer  to  understand  that  horse-power  has  to 
be  brought  from  somewhere,  nor  that  a  tremendous  pro- 
portion of  these  water-powers  are  quite  a  long  way  off, 
in  unsettled,  inhospitable  country.  As  going  out  to  them 
is  impossible,  can  the  power  be  transmitted  such  a  long 
distance,  and  if  so,  will  it  pay  dividends? 
Time  for  Taking  Warning 

The  answer  is  very  probably  in  the  affirmative;  but  at 
this  present  nadir  of  expansion  we  might  aptly  appropriate 
the  railway  warning  and  stop,  look  and  listen.  The  be- 
setting fault  of  the  Canadian  "expansionist"  is  that  he  sees 
progress  through  a  wide-angle  lens.  He  always  wants  to 
be  developing  and  expanding  something  or  some  place  a 
long  way  off.  He  wants  to  settle  the  Peace  River  country, 
while  in  the  prairie  provinces  there  are  still  thirty  million 
acres  of  good  and  undeveloped  farm  lands  within  a  fifteen 
mile  radius  of  existing  railways.  He  likes  to  toy  with  the 
prospect  of  domesticating  the  reindeer  as  an  auxiliary  food 
supply,  or  of  growing  more  ginseng  with  an  eye  on  the 
export  trade  to  China.  If  there  is  indeed  such  a  beef 
shortage  we  might  cheerfully  forget  the  British  embargo 
on  Canadian  cattle. 

"Of  course,"  someone  will  say,  "you  can't  progress 
without  the  larger  vision.  There  must  be  dreamers,  or  we 
should  be  crowded  to  death  soon.  We  must  learn  to  think 
in  large  spaces,  in  terms  of  the  atlas.  Look  at  the  C.P.R. ' 
— see  how  much  ahead  they  were  of  their  times!  "*I  lived 
in  the  West  myself  long  enough  to  observe  that  the  way 
of  the  knocker  is  indeed  hard.  Even  in  1921,  which  is  a 
very  different  kind  of  a  year  from  1911,  the  knocker  is  no 
better  than   a  variety  of  shock  troops." 

*But  the  C.P.R. ,  of  course,  did  not  build  without  very 
careful  surveys — and  they  did  change  their  original  route 
in   a  very   striking  way! 

Canada  has  ceased  to  be  a  frontier  country  because  no 
one  wants  to  live  the  frontier  life.  The  cities  are  growing 
faster  than  the  rural  sections;  people  want  to  enjoy  the 
fruits  of  the  development  of  the  far  fields  without  helping 
to  develop  them  themselves.  They  want  someone  else  to 
swing  the  axe  or  drive  the  plough;  for  themselves  they  want 
to  stay  at  home  and  manufacture  things  for  the  wider 
market,  or  to  develop  their  city  into  the  trading  centre  of 
the  rich  new   region. 

Movement  of  Industry 

Industry  seldom  colonizes  ;it  prefers  to  stay  some- 
where close  to  the  main  line  and  the  hydro-station  and  the 
big  markets.     When  it  moves  it  is  because  of  over-crowding. 


January   6,   1922. 


THB      MONETARY      TIMES 


11 


Except  in  the  case  of  newsprint  and  other  isolated  indus- 
tries, it  radiates;  it  does  not  go  out  into  the  wilderness 
and  create  a  supply  before  there  is  a  demand.  A  very 
promisinj?'  suKar-beet  industry  fell  through  in  Alberta — 
peculiarly  fitted  to  support  it — because  the  farmers  would 
not  rai.se  beets  till  the  refinery  wa.s  there,  while  the  re- 
finery would  not  go  there  till  the  farmers  were  raising 
beets.  If  Alberta  had  a  large  population  neither  farmer 
nor  refinery  would  hesitate  a  .second. 

During  the  ten  years  preceding  the  war  Canada  went 
through  a  carnival  of  boosting  and  Fivc-Thousand-Fact.s- 
About-Canada-ing,  which  in  the  end  created  a  kind  of 
junkerism.  "Canada  Uber  Alles!"  We  poured  out  deluges 
of  statistics,  how  we  had  the  most  coal,  the  finest  wheat, 
the  mo,st  asbestos,  the  least  population,  the  best  climate,  and 
so  on.  And  then  we  allowed  a  lot  of  real-estate  men  to 
cash  in  on  these  wonderful  resources  by  selling  sky-line 
sub-divisions,  and  by  letting  a  number  of  cities  hire  indus- 
trial commissioners  to  squabble  with  each  other  in  attract- 
ing factories. 

Unsuccessful  Industries 

Tho.se  western  "industries,"  for  example!  There  was 
the  classic  industry  of  the  nail  factory  that  located  it.self 
in  a  praii'ie  city,  six  hundred  miles  from  the  nearest  iron 
deposits.  It  was  a  poor  sort  of  an  indu.stry,  in  fact,  which 
could  not  sit  round  the  table  with  half  a  dozen  competing 
cities  fighting  among.st  them.selves  to  get  its  payroll,  and 
at  that  get  away  with  the  jackpot.  A  free  site,  a  cash 
bonuji,  tax-exemption — it  got  them  all,  did  that  reluctant 
industry  which  simply  could  not  locate  in  that  particular 
city  unless  the  city  came  to  its  assistance  in  .some  such  way. 
A  .subsidized  indu.stry  being  more  or  less  a  shaky  industry, 
in  due  course  the  city  frequently  found  itself  holding  the 
sack,  in  which  was  an  empty  factory  worth  about  one-quarter 
what  they  had  paid  in  cash  and  franchises  to  the  "pro- 
moter," while  the  promoter,  with  the  other  three-quarters, 
was  off  somewhere  selling  Florida  orange-lands  or  Texas 
oil  stock. 

But  let  a  legitimate  industry,  logical  to  the  region, 
indigenous  to  the  soil,  dependent  upon  the  raw  material  of 
the  neighborhood,  ask  for  some  concession — even  ask  for  a 
time  extension  on  its  notes- — and  everybody's  thumbs  were 
turned  down  immediately!  The  great  industrial  tragedy  of 
Western  Canada  was  that  it  was  trying  to  manufacture 
nails,  or  underwear,  or  perfumes,  when  it  should  have  been 
manufacturing  pork,  or  flour,  or  linen  When  it  did  acci- 
dentally stumble  upon  gieat  potentialities,  such  as  the 
Calgary  oil  "strike"  of  unhappy  memory,  it  allowed  these 
to  bee  on  e  the  victim  of  a  boom  to  which  gravitated  the 
confidence  men  and  Wallingfords  of  the  continent,  who 
eventually  made  Calgary  rancid  to  the  nose  of  the  inve.stor 
before  even  the  possibilities  of  the  new  oil-fields  had  been 
properly  investigated. 

Sectional  Booms 

I  sometimes  think  our  government  lends  a  tacit  en- 
couragement to  booms  in  order  to  cover  up  its  own  de- 
ficiencies. Oil,  Cobalt,  real-estate,  newsprint,  the  alleged 
export  market — what  are  all  booms  but  sectional,  the  en- 
deavor to  get  rich  more  quickly  than  some  other  section,  to 
get  richer  (in  many  cases)  than  the  circumstances  justify? 
What  should  we  say  to  a  department  store  which  allowed 
one  department  to  conduct  a  sales  policy  of  its  own,  with 
the  ultimate  object  of  diverting  cu.stomers  from  other  de- 
partments? Canada  is  nothing  but  a  department  store, 
and  the  whole  is  greater  than  any  part. 

Yet  sectionalism,  although  bad  _business,  is  unfortun- 
ately good  political  expediency.  Consequently  there  is  no 
national  business  policy.  The  part  has  been  allowed  to 
become  greater  than  the  whole.  Practically  every  section 
of  Canada  cherishes  the  idea  that  it  is  the  cynosure  of 
every  eye  and  the  hub  around  which  the  remainder  of  the 
country  revolves.  Some  part  of  this,  of  course,  is  acci- 
dental, because  broadly  speaking  each  section  has  its  large 
undeveloped  areas,  its  farthest  west  or  its  farthest  north: 
and  also  because,  again  broadly  speaking,  each  section  has 
incurred  heavy  indebtedness  in  anticipation  of  a  more  rapid 


growth  than  the  normal.  But  there  is  no  reason  at  all  why 
any  section  of  Canada  should  grow  at  the  expense  of  an- 
other. There  is  no  reason  why  Saskatchewan  ahoald  add 
hundreds  per  cent,  to  its  population  while  Prince  Edward 
Island  becomes  depopulated,  nor  any  why  Nova  Scotia  and 
New  Brunswick  should  fail  to  get  their  quota  of  the  im- 
migration which  flows  in  every  year.  It  is  a  rather  sad- 
dening sight,  for  example,  to  travel  through  itone  parts 
of  Western  Ontario  and  see  the  non-active  farms  whose 
owners  have  emigrated  west.  There  is  room  enough  every- 
where ,and  surely  Canada  has  infinite  variety  enou|^  to 
;,..,„...i    t,.   .]HT,...^..^  ta-ste.s. 

Poor  Immigrstlon 

Kven  in  the  hey  day  of  immigration  we  fitted  many 
s  uarc  pegs  into  round  holes.  We  •^••<'  •■'■'>  down  on  the 
praii'ie.i    many    thousand.s.   of    fine    i  ■.    who    would 

have  been   happier   in  the  orchar-l    •  '•""  east;   we 

dumped  into  British  Columbian  reds  who 

snould  have  l)een  running  little  .-,...,.-,  "..i.  ,,,.,,.i  to  them- 
.  elves  and  the  Dominion.  Our  future  immigration  will 
probably  be  more  "choosy,"  and  we  shall  have  to  show  it 
more  than  one  trick.  That  should  be  the  function  of  the 
govenmient,  to  direct  the  newcomer  to  the  pi;;  '  -  -vhich 
he    is   temperanicntally   suited,   or   which   the  nets 

of  the  moment  suggest  would  afford  him  the  grcax*  -t  hope. 
It  should  not  be  left  to  the  nine-and-.-iixty  jarring  sections 
to  stand  bellowing  for  immigrants  and  for  industries,  very 
much  like  hotel-runners  outside  a  railway  station. 

We  need  a  stock-taking  of  possible  development;  show- 
ing what  we  haven't  as  well  as  what  we  have,  A  recapitula- 
tion of  our  resources  and  on  '  "ness  does  not  deny 
theil-  existence;  it  merely  a';  of  sanity  in  upon 
them.  To  say,  for  example,  uiul  (  anada  rais«.s  the  best 
million  wheat  in  the  world,  but  to  deny  in  cross-examina- 
tion that  sometimes  in  certain  localities  wheat  is  frozen  in 
Canada  before  it  ripens,  is  to  harm  all  Canada  in  the  end. 

Area  and  PoptUation 

Nor  .-iiouii  «e  try  to  monkey  with  geography,  to  pre- 
tend that  we  have  a  Mississippi  River  when  we  haven't, 
or  to  imply,  because  we  have  a  large  area  and  a  small 
average  population  per  square  mile  that  therefore  our  future 
destiny  is  the  same  large  area  multiplied  by  a  large  average 
population  per  square  mile.  I  came  across  an  old  clipping 
the  other  day  detailing  the  subsidy  paid  by  the  Dominion 
government  to  the  Canadian  Press,  Limited,  on  account  of 
its  operation  round  the  North  Shore  of  Lake  Superior. 
The  clipping  is  dated  1919,  but  doubtless  the  subject  matter 
is  unaffected,  for  the  Algoma  country  is  .so  strikingly  a  non- 
revenue  one  for  the  Canadian  Press  that  the  all-Canadian 
news  .service  would  apparently  be  impossible  without  a  sub- 
sidy. The  thought  is  that  the  papers  of  the  west  might, 
in  default  of  an  all-Canadian  service,  receive  an  aU-Amari- 
can  .service  and  eventually  become  all-American  thamsdiraa. 

There  is  a  type  of  mind  which  cannot  distingniaii  be- 
tween optimism  and  extravagance.  Fabianism  is  not  a 
recommendable  doctrine;  we  miist  co-ordinate  our  efforts 
and  know  at  once  the  best  and  worst — and  then  go  grin- 
ning for  development.  It  should  be  part  of  our  immigra- 
tion propaganda  to  hold  a  national  stock-taking  conducted 
by  forward-looking  men  who  can  tell  oats  from  dandetkos. 

Only  don't  let's  have  a  committee.  Some  rsrnlMii  word 
might  be  dropped,  and  they  would  fly  off  on  a  n<Ri-pt«sist- 
ant  tangent.  Somebody  might,  say,  mention  something  aboat 
dandelions,  and  the  first  thing  we  should  know  thei«  would 
be  a  bright  blue-covered  report  on  the  Possibilities  of  tha 
Dandelion  Industry  on  the  Queen  Charlotte  Islands. 

*But  the  C.  P.  R..  of  cource,  did  not  butld  wlthoat  t**t 
careful  surveys — and  they  did  chance  their  orlalnal  r«at«  la  a 
very  striklnK  wayl 


GERMAN  PRE-WAR  DEBTS. 

The  time  for  re<nstering  cUims  against  Germaas  oa 
account  of  pre-war  debta  closed  on  March  31,  1921.  N« 
announcement  has  as  yet  been  made  by  the  Goremmott  as 
to  how  the  claims  will  be  disposed  of. 


12 


THE      MONETARY      TIMES 


Volume  68. 


Canada's  Economic  Progress  at  a  Glance 


BANKING    STATISTICS 

Oct.   31  Total  Assets 

1910  $1,260,755,709 

1911 . 

1912  

1913  

1914  

1915  

1916  

1917  


1,381,280,989 
1,521,105,096 
1,575,550,980 
1,577,919,069 
1,657,256,962 
1,968,940,288 
2,244,878,054 


Paid-up  Capital 
and  Reserve 
1176,889,102 
199,582,373 
218,773,578 
226,966,252 
228,245,019 
226,738,438 
226,053,811 
225,187,422 
217,712,095 
241,152,863 
257,682,757 
264,338,629 


1918  2,638,839,732 

1919  2,967,598,848 

1920  3,155,601,568 

1921  2,806,827,597 

BANKING  STATISTICS — Continued 

Deposits  on   demand 
Oct.   31  and   after  notice  Circulation 

1910     $     829,855,337  f    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 

1921 2,101,229,335  193,546,363 

TRADE    OF    CANADA* 

Fiscal   year  Exports  of 

ended  March  Canadian  produce 

1906     f     235,483,956 


tl907 
1908 
1909 
1910 
1911 
1912 
1913 
1914 
1915 
1916 


180,545,306 
246,960,968 
242,603,586 
279,247.551 
274,316,553 
290,223,857 
355,754,600 
431,589,658 
409,419,503 
741,610,953 


1917  1,151,461,855 

1918  1,540,318,069 

1919  1,207,613,806 

1920 1,239,492,098 

1921  1,189,163,701 


Exports  of 
foreign  produce 
111,173,846 
11,541,927 
16,407,984 
17,318,782 
19,516,442 
15,683,657 
17,492,294 
21,313,755 
23,848,785 
52,023,673 
37,689,432 
27,835,332 
46,142,004 
52,321,479 
47,166,611 
21,264,418 


•Merchandise  only. 
tNlne  months. 

TRADE    OF 
Fiscal  year 
ended   March 

1906    $ 

tl907    

1908    

1909    

1910    

1911    I 

1912    

1913     

1914     

1915     

1916     

1917     

1918     

1919 

1920     

1921     1 


CANADA*— 

Imports  for 

consumption 

283,282,204 

249,737,874 

351,879,955 

288,217,515 

369,815,427 

451,745,108 

521,448,309 

670,089,066 

618,457,144 

455,446,312 

507,817,159 

845,356,306 

962,543,746 

916,443,432 

1,064,528,123 

,740,145,056 


Continued 

Total  trade 

of  Canada 

$     529,940,006 

441,825,107 

615,248,907 

548,139,881 

668,579,420 

741,745,318 

829,164,460 

1,047,157,421 

1,073,894,368 

916,888,821 

1,287,117,229 

2,024,567,406 

2,548,713,538 

2,176,378,717 

2,351,174,878 

2,450,553,175 


TRUST   AND   LOAN   COMPANIES' 
Trust   Cos. 

1918 $551,428,791 

1919     689,795,777 

1920     742,930,349 


Year 
1910 
1911 
1912 
1913 
1914 
1915 
1916 
1917 
1918 
1919 
'1920 
1921 


BOND    SALES 

Sales  in  Canada 

.  .     $    39,296,462 

44,989,878 

37,735,182 

45,603,753 

32,999,860 

114,275,214 

102,938,778 

546,330,714 

727,446,361 

705,385,419 

101,830,667 


ASSETS 

Loan   Cos. 
$245,302,208 
250,076,621 
242,245,302 


Sales  in  U.  S. 

$      3,634,000 

17,553,967 

30,966,406 

50,720,762 

53,944,548 

178,606,114 

206,943,764 

174,708,365 

33,310,000 

199,446,670 

223,084,000 


*No  war  loans  this  year. 

BOND     SALES — Continued 
Year  Sales  in  U.  K.  Total  bond  sales 

1910  $188,070,128 

1911  204,269,143 

1912 204,236,394 

1913  277,470.780 

1914  185,990,659 

1915  

1916  

1917  

1918  

1919  

1920  


$231,000,590 
266,812,988 
272,937,982 
373,795,295 
272,935,067 
335,106,328 
356,882.542 
726,039,079 
775,356,361 
909,937,222 
324,914,667 

The  sales  in  the  United  Kingdom  since  1915  have  nearly 
all  been  refunding  Issues. 


41,175,000 
5,000,000 
5,000,000 

14,600,000 
5,105,133 


TRANSPORTATION 
Steam  railways 
(earnings) 

1914     $243,083,539 

1915     199,848,072 

1916     261,888,654 

1917     310,771,479 

1918     330,220,150 

1919     382,976,901 

INSURANCE 


Fire 
(premiums) 

1911     $20,575,255 

1912     23,194,518 


1913 
1914 
1915 
1916 
1917 
1918 
1919 
1920 


25,745,947 
27,490,158 
26,474,833 
27,783,852 
31,246,536 
35,954,408 
39,914,398 
50,565,856 


Fire 
(losses) 
$10,936,947 
12,119,581 
14,003,759 
15,347,284 
14,161,949 
15,111,133 
16,379,101 
19,359,252 
23,207,647 
22,931,129 


•Merchandise  only. 
tNlne  months. 


INSURANCE — Continued 
Life 
(net  in  force) 

1913  $1,168,590,027 

1914  1,242,160,478 

1915  1,311,616,677 

1916  1,422,179,632 

1918  1,785,061,273 

1919  2,187,833,396 

1920  2,657,037,219 


Elec.  railways 
(earnings) 
$29,961,007 
26,922,900 
27,416,285 
30,237,664 
24,299,890 
35,696,532 


Fire 
(at  risk) 
$2,279,868,346 
2,684,355,895 
3,151,930,389 
3,456,019,009 
3,531,620,802 
3,720,058,236 
3,986,197,514 
4,523.514,841 
4,904,396,461 
5,971,330,272 


Life 
(premiums) 
$38,641,206 
41,094,095 
45,106,678 
48,093,105 
61,641,047 
74,689,262 
90,212,934 


January  6,   1922. 


THB      MONETARY      TIMES 


U 


CURRENCY 
*Dom.  notes 
In  circulation 

1911     I   99,308,945 

1912     Ill, g-^a. 2.38 

1913     116,363,537 

1914     114,182,098 

1915     152,117,695 

1916     175,494,135 

1917 178,564,970 

1918     281,336,474 

1919     299,530,655 

1920     292,016.290 

1921     268,769,184 


tBank  notes 
in  circulation 
t  89,982,223 
100,146,5*1 
105,265.336 
104,600,185 
105,137,091 
126,691,913 
161,029,606 
198,645,254 
218,919,261 
228,220,603 
206,537,974 


♦Year  ended  June. 
tMonthly  average. 


MISCELLANEOUS 

Dun's  Price 

Bus.  failures  Index 

1911     1,332  127.4 

1912     1,357  134.4 

1913     1,719  135.5 

1914     2,892  136.1 

1915     2,652  148.0 

1916     1,677  182.0 

1917     1,088  237.0 

1918     873  278.3 

1919     751  293.2 

1920     1,078  333.6 


Population 


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 

1920 


Mar.  31. 
1897. 
tl900. 
1905. 
1910. 
1913. 
1914. 
1915. 
1916. 
1917. 
1918. 
1919. 
1920. 
192f. 


BIdg.  permits 

$138,170,390 

185,233.449 

153,662,842 

96,780,981 

33.566,749 

39.724.466 

33.936.426 

36.838,270 

77,113.413 

100.983.430 


Immigration 


21.716 
23,895 
46,266 
08,794 
02.432 
84,878 
44.789 
48.537 
75,374 
79.074 
57.702 
17,336 
48,477 


•Estimated. 

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 — TontlnncMl 

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. 

Prlmai'y    Proiluction — Cont  inurd 

Coal  Coal 

tosn  v.iluo 

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 


Prifuar)'    Product  ton— (>>ntinnrd 

Gold                       Silver  Slekel 

ozB.                           •zs.  lbs. 

1914 773.178  28,449.821  4S.517,>S7 

1915 918,656  26,625,960  68,308.667 

1916 930,492               25,469,741  82.»58,S64 

1917 738,831  22,221,274  84.330.280 

1918 710,526  21.284,607  »2,076.0I4 

1919 767,167               16.675,134  44,642, »6S 

Primary   Product  Ion— OoMlaacd 

Copper  Total    value 

lbs.  mineral   prodaetion 

1914    75,786,960  $128.863,07& 

1915    100,785.150  138.»20,78» 

1916 117.150,028  177,201,634 

1917    109.227,332  189.646.821 

1918    118.415,829  210,204,970 

1919 74,124.663  178.075.913 


Canada's  Economic  Progress  Illustrated 


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Y  t  AH 

NOVA    SCOTIA    COAX    PEODUCTION 

Nova  Scotia  coal  mines  operated  by  the  British  Ehnpir*- 
Steel  Corporation  produced  3^7,946  tons  of  coal  duriiic 
the  first  nine  months  of  the  current  year.  This  output  w«6 
made  up  as  follows: — 

Dominion  Coal  Company's  colleries  in  Cape  Breton,  Z,- 
301,594  tons. 

Dominion  C{>al  Company's  colleries  at  Springhill,  Com- 
berland.  County,  282,848  tons. 

Acadia  Coal  Company's  colleries  at  Stellarton.  Picton 
County.  275,958  tons. 

Nova  Scotia  Steel  Company's  colleries  in  Cape  Bntar 
437,546  tons. 

It  is  estimated  that  the  total  output  for  the  y«ar  will 
be  about  4,400,000  tons.  In  1920  the  oatpat  was  4JBS9,40S 
tons.  The  larifest  recorded  annual  prodaetion  of  th«M  \ 
was  in  1913,  when  the  output  was  about  8,600,000  tooa, 

Shipment.<:   of   Nova   Scotia  coal   up   tha  St    Lai 
in   1921  totalled  some  1.200,000  tons.     This  represents  wb 
stantial  progress  towards  the  recovery  of  the  Montrvd  bmu- 
kets,  but  it   is  a  long  way  from  the  pre-war  ahtpmants  by 
water,  which  ran  between  1,600,000  and  S.000,000  tons  per 
season. 


14 


THE      MONETARY      TIMES 


Volume  68. 


Federal  Affairs  During  The  Past  Year 

Defeat  of  the  Conservative  Administration  at  General  Election  Held  in 
December  Was  Leading  Feature — The  New  Liberal  Government  and  Its 
Personnel — Some  of  the  Problems  Dealt  With,  and  Still  to  be  Taken  Up 

By  THE  MONETAKY  TIMES'   OTTAWA  CORRESPO^^DENT 


TN  the  federal  arena  the  dominant  event  o£  the  year  was' 
A  the  election  on  December  Cth,  when  Hon.  W.  L.  Mac- 
kenzie King  was  returned  to  power  with  H7  Liberal  sup- 
porters, Premier  Meighen  defeated  in  the  country  and  in  his 
own  constituency,  and  Hon.  T.  A.  Crerar  returned  with  64 
Progressive  supporters.  There  were  as  well  fifty  Conserva- 
tives elected  and  two  Labor  men,  and  one  of  the  Ontario 
Conservatives  is  expected  to  resign  his  seat  soon  in  favor 
■oi  Premier  Meighen. 

The  election  was  the  dominant  fact  of  1921  because  it 
had  been  throwing. its  shadow  before  it  for  more  than  a 
year,  and  it  had  even  influenced  the  course  of  debate  and 
the  legislation  of  the  preceding  session  of  Parliament.  For 
example,  the  Dominion  Election  Act,  which  had  been  passed 
in  1920  to  replace  the  War  Times  Election  Act,  was  sub- 
jected to  a  fierce  scrutiny  by  the  Opposition  members,  who 
wanted  an  act  which  would  be  fair  to  them  and  which  would 
not  shut  out  any  classes  of  Canadian  residents  from  whom 
they  expected  support.  Changes  in  the  Election  and  Natur- 
alization Acts  were  made  in  consequence.  The  shadow  of 
the  coming  election  could  also  be  seen  in  the  challenges  made 
by  the  Liberal  leader  in  amendments  to  the  Address  in  reply 
to  the  Speech  from  the  Throne  and  in  the  budget  debate 
where  the  government  was  called  on  to  resign.  Votes  of 
want  of  confidence  were  voted  down  on  each  such  occasion, 
and  the  government  finished  the  session  with  its  majority 
practically  undepleted.  It  was  then  expected  that  there 
would  not  be  an  election  until  after  the  1922  session  of 
Parliament.  Premier  Meighen  went  to  a  conference  of 
Premiers  of  the  British  Empire  in  London,  where  it  was 
decided  to  postpone  action  in  adapting  the  constitutional 
relations  of  the  Empire  to  changed  conditions  and  where  he 
is  said  to  have  exercised  a  strong  influence  in  advising  the 
British  Government  not  to  renew  the  Anglo-Japanese  Treaty 
without  first  consulting  the  United  States  and  securing  some 
arrangement  that  would  conduce  to  the  welfare,  security 
and  friendship  of  all  three.  While  there  he  received  news 
that  the  Medicine  Hat  bye-election  had  gone  against  the 
government  candidate,  and  this  is  believed  to  have  been  the 
straw  which  decided  the  Premier  to  have  an  election. 

The  New  Parliament 

The  new  Parliament  will  have  completely  few  old  mem- 
bers of  the  rank  and  file  west  of  the  Ottawa  river.  It  will 
have  a  solid  delegation  of  Progressive  members  who  will 
reflect  mainly  Western  low  tariff  ideas  and  sentiment  favor- 
ing national  ownership  of  railways.  It  will  have  a  Con- 
servative group  drawn  mainly  from  Ontario,  and  it  will 
have  a  Liberal  Government  whose  membership  comes  in 
great  part  from  Quebec  and  the  Maritime  Provinces.  This 
government,  having  just  half  of  the  235  members  of  parlia- 
ment after  appointing  a  speaker,  will  have  to  depend  for 
support  on  members  from  either  or  both  of  the  other  two 
parties  by  the  kind  of  legislation  which  it  introduces.  So 
far  as  the  last  session  of  parliament  offers  any  criterion 
it  will  find  its  best  chance  of  support  among  the  Progressive 
members. 

In  review  the  past  year's  legislation  and  the  debates  in 
the  House  of  Commons  emphasis  will  be  given  here  chiefly 
to  those  issues  on  which  there  was  difference  of  opinion,  as 
in  such  cases  the  new  government,  aided  by  the  Progressives, 
may  be  expected  to  take  further  action. 

The  Railway  Situation 
First,  the  railway  situation  was  the  principal  football 
of  the  session  because  the  government  asked  for  |178,000,000 


as  an  appropriation  for  railways,  of  which  $140,000,000  was 
for  its  railway  obligations  in  connection  with  the  Canadian 
National  and  Grand  Trunk  Railways  taken  over  by  the 
government  when  they  failed  to  meet  their  obligations.  This 
was  a  considerable  increase  on  the  previous  year,  and  the 
Opposition  asked  the  government  for  full  details,  and  sharply 
challenged  the  contention  that  these  had  to  be  withheld  in 
order  not  to  give  the  Canadian  Pacific  Railway,  a  com- 
petitor, important  information  about  the  railway's  business. 
Eventually  a  special  parliamentary  committee  was  formed 
to  delve  into  and  make  a  report  on  the  situation,  but  little 
important  contribution  was  made  to  the  existing  stock  of 
information.  As  an  indication  of  what  change  in  railway 
policy  will  occur  under  the  new  administration,  it  is  more 
valuable  to  note  that  the  Lberal  leader  in  his  campaign 
speeches  stated  that  public  ownership  was  to  be  given  a 
fair  trial.  Hon.  Rodolphe  Lemieux,  one  of  his  chief  lieuten- 
ants, came  out  frankly  for  a  modified  Shaughnessy  plan, 
by  which  the  Grand  Trunk  Railway  would  be  abandoned  to 
its  original  or  other  owners  after  relieving  it  of  its  Grand 
Trunk  Pacific  obligations,  and  by  which  the  Canadian  Na- 
tional and  government  roads  would  be  merged  with  the  Cana- 
dian Pacific  Railway  under  a  Canadian  Pacific  directorate 
after  certain  productive  assets  of  the  C.P.R.  had  been 
sequestered  and  an  undertaking  made  by  the  government  to 
pay  C.P.R.  shareholders  a  fixed  annual  interest  in  perplexity. 
The  road  would  then  be  owned  by  the  government  and  the 
board  of  management  would  be  independent  of  interference 
by  the  government  or  any  other  body  except  the  board  of 
railway  commissioners,  as  already  provided  for  under  the 
law. 

Views  Are  Varied 

Sir  Lomer  Gouin,  who  will  be  one  of  the  new  govern- 
ment's most  outstanding  figures,  also  took  the  view  during 
the  campaign  that  under  private  ownership  railway  deficits 
would  be  less  than  Under  government  ownership,  and  the 
Hon.  Walter  Mitchell,  late  provincial  treasurer  for  Quebec, 
argued  that  a  commission  of  the  greatest  railway  experts 
who  could  be  obtained  should  invetsigate  the  whole  situation 
and  their  advice  be  followed.  All  this  time  the  Liberal 
leader  was  criticizing  the  present  Canadian  National  Railway 
directorate  on  the  ground  that  a  number  of  the  directors 
were  also  directors  on  companies  which  secured  large  con- 
tracts from  the  railway  for  supplies  and  material.  It  is 
fair  to  assume,  and  your  correspondent  knows  that  it  is 
being  strongly  advocated  by  some  Liberals  that  this  director- 
ate may  therefore  be  displaced  by  the  new  government  in 
favor  of  a  board  of  management  composed  mainly  of  experts 
without  financial  interest  in  other  companies  and  of  a  few 
others  representing  the  community  and  the  workers.  The 
Montreal  contentions  referred  to  will  not  be  actively  pushed 
until  it  is  ascertained  whether  progressive  improvement 
shows  in  the  situation  under  the  new  measure  to  be  taken. 

The  new  government  has  also  before  it  a  proposal  made 
by  Sir  Joseph  Flavelle  to  Premier  Meighen  last  August 
that  the  problem  should  be  solved  by  forming  a  new  Na- 
tional Railway  Company,  with  a  nominal  capital  of  five 
million  common  shares  and  2,500,000  six  per  cent,  preference 
shares.  By  this  plan  the  government  would  wipe  out  of 
consideration  the  initial  cost  of  the  International  and  Trans- 
continental railways.  It  would  accept  common  stock  in 
pajmnent  of  all  the  millions  hitherto  advanced  for  deficits 
of  the  company  and  money  to  be  advanced  on  deficits  that 
may  occur  during  the  next  few  years,  and  it  would  receive 
six  per  cent,  preference  shares  for  all  moneys  advanced  for 


January   6,   1922. 


THE      MONETARY      TIMES 


IS 


capital  expenditures  which  he  expected  would  be  from  $125,- 
000,000  to  $175,000,000  yearly  in  the  next  five  years.  By 
his  plan  the  government  would  turn  the  equity  in  the  road 
over  to  thi.s  new  company,  .subject  to  the  bonds,  debentureb 
and  fjuiirantced  .stock  held  by  the  company,  at  the  end  of 
1921,  which  was  then  the  date  evidently  in  mind  for  taking 
the  Grand  Trunk  Railway  over.  Such  a  plan  could  be 
accepted  by  the  new  >?"veininent  without  surrender  of  its 
own  idea.s,  and  it  would  probably  prove  acceptable  to  the 
Hon.  T.  A.  Crerar,  who  pled  on  the  floor  of  the  House  of 
Common.s  for  a  thorough  reorganization  of  the  roads  when 
the  Grand  Ti-unk  is  taken  over,  the  avoiding  of  duplication 
either  in  operations  or  lines,  and  the  ceasing  of  unprofitable 
services  a.s  far  as  possible. 

The  situation  was  further  complicated  by  deputations 
from  various  societies  of  the  community  both  to  the  gov- 
ernment and  to  the  railway  commission  asking  that  freight 
rates  should  come  down  in  the  interest  of  the  restoration  of 
business  and  from  the  railways  urging  the  operating  ex- 
penses and  wages  .should  first  go  down.  Wage.s  did  go 
down  t\yclve  per  cent.,  and  freight  rates  have  also  been 
brought  down  ten  per  cent,  from  the  increases  of  twenty- 
five  per  cent,  in  the  West  and  35  per  cent,  in  the  East  last 
year. 

Attitude  ou  the  Tariff 

With  regard  to  the  tariff'  the  attitude  taken  by  the 
Opposition  at  the  last  session  affords  a  better  guide  as  to 
what  it  may  do  as  the  government  next  session. "  In  the 
actual  schedules  little  change  was  made  at  the  last  session 
of  parliament  in  the  tariff  and  these  changes  were  mainly 
to  implement  the  preferential  arrangements  arrived  at  in 
the  Canada-West  Indies  Treaty  with  respect  to  such  pro- 
ducts as  cocoa,  cocoa  products,  arrowroot,  onions,  grape- 
fruit, limes,  cocoanuts,  sugar  and  rum.  There  was  also 
agreed  to  an  ar  lunKeinent  giving  France  the  benefit  of 
the  Intermediate  tariff.  The  dumping  provisions  were  made 
more  stringent  at  the  last  session,  and  it  is  likely  that  the 
Liberals  will  keep  the  provisions  while  making  the  enforce- 
ment less  arbitrary.  The  government  will  probably  do  away 
with  the  amendment  passed  last  session  to  the  Customs  Act, 
providing  that  for  purposes  of  Customs  valuation  no  foreig^n 
currency  depreciation  exceeding  fifty  per  cent,  of  the  normal 
shall  be  recognized.  Hon.  W.  S.  Fielding,  who  may  be  Min- 
ister of  Finance  in  the  next  cabinet,  assailed  this  clause 
as  one  which  surreptitiously  increased  the  tariff  from  the 
percentages  of  30  to  35  per  cent,  set  forth  in  the  schedules 
to  such  a  point  that  it  became  "a  tariff  of  70,  80,  90,  100, 
150,  and  even  two  hundred  per  cent.,"  against  countries 
where  the  currency  was  badly  depreciated,  such  as  Ger- 
many, a  late  enemy,  and  Roumania  and  Italy,  late  allies 
It  was  defended  by  Sir  Henry  Drayton  on  the  ground  that 
the  mark  had  not  depreciated  so  much  in  Germany  as  it 
had  in  the  markets  of  the  world,  and  that,  as  labor  and 
materials  therefore  cost  German  manufacturers  less  than 
their  foreign  competitors,  they  could  under-sell  with  ease. 
That  situation  has  changed,  and  it  is  sure  that  the  Liberals 
will  go  back  to  the  old  arrangement  by  which  the  Customs 
practice  was  to  change  foreign  depreciated  currency  into 
Canadian  on  the  basis  of  existing  exchange  rates. 

Marking  Regulations 

Similar  criticism  was  launched  at  the  leg^islation  made 
effective  last  session  to  compel  foreign  manufacturers  to 
brand  all  goods  exported  to  Canada  to  have  marked  on  them 
in  English  or  French  the  country  of  origin.  The  difficulties 
ir.  the  way  of  enforcement  without  injury  to  goods,  annoy- 
ance and  loss  of  time  and  money  to  importers  and  without 
fraudulent  stamps  caused  the  importing  world  to  protest 
strongly  against  this  law  and  the  regulations  made  under  it. 
As  a  result  its  operation  was  deferred  from  September  1st 
to  Januaiy  1st,  and  Hon.  J.  B.  M.  Baxter,  Minister  of  Cus- 
toms under  the  ertiring  government,  promised  that  it  would 
be  deferred  until  parliament  could  consider  it  again.  The 
Liberals  are  apt  to  repeal  it.  No  doubt  overtures  will  be 
made  by  the  Liberals  to  Washington  for  a  reciprocity  agree- 
ment, as  for  the  moment  the  United  States  Govemmen  seems 


ill  an  acfiuiescent  mood,  and  aJi  the  Liberals  and  Progrswifea 
last  session  all  voted  for  a  reciprocity  resolutioa  introdoecd 
by  Hon.  Mr.  Fielding,  and  which  was  defeated. 

Berenne  Otaances 

The  business  profits  war  tax  waii  dropped,  and  all  the 
luxury  taxes  which  had  not  b«*<»n  removed  by  an  order-in- 
council   in  the  previous    I  .  were  abolixhed.     To  re- 

place the  revenue  thus  aL..  heavier  duties  were  placed 

on  playing  cards,  wines  aiid  npirits,  and  the  tax  on  sales 
was  increased.  On  sales  of  manufacturers,  wholesalers,  im- 
porters and  jobbers  the  tax  increased  from  one  and  two  per 
cent,  on  domestic  transactions  to  IV^  and  three  per  cent, 
and  to  2'/^  and  four  per  cent,  on  imported  goodh. 

The  Dominion  Census 
Among  other  important  events  of  the  federal  year  con- 
siderable interest  attaches  to  the  Dominion  census  started 
on  June  1st  of  the  pre.scnt  year.  At  the  time  of  writing  the 
complete  returns  had  not  come  in,  but  it  was  expected  that 
the  total  population  of  Canada  would  not  exceed  8,600,000. 
This  will  not  add  more  than  four  or  five  members  of  par- 
liament to  the  total  of  235  now  obtaining,  because  Quebec's 
advancing  population  means  that  the  sixty-five  seats  there 
will  have  each  a  unit  of  measurement  of  about  86,000  in- 
stead of  30,000  as  at  present. 

During  the  year  two  federal  referenda  in  the  provincial 
areas  of  Ontario  and  New  Brunswick  were  held,  the  results 
being  a  decision  to  prevent  the  importation  of  intoxicating 
liquor  in  each  case. 

The  Limitation  of  Armaments  conference  at  Washington 
has  produced  results  of  value  to  Canada  in  that  future  in- 
crease of  expenditure  of  the  British  Empire  and  therefore 
of  Canada  on  naval  an.iament  w^ill  be  curtailed.  The  de> 
cision  to  substitute  for  the  Anglo-Japanese  Treaty  an  ar- 
rangement that  will  bring  the  United  States  and  China 
into  a  four  power  arrangement  also  means  much  for  the 
future  peace  of  Canada. 

The  Oonserration  Commission 

Of  doubtful  value  to  the  country  was  the  abolition  by 
parliament  of  the  Conservation  Commission.  Of  still  more 
doubtful  value  was  the  action  of  the  Senate  in  killing  the 
government's  bill  creating  a  National  Research  Institnta. 
The  bill  providing  for  unemployment  insurance  was  not 
even  introduced,  its  fate  being  regarded  as  certain. 

The  Parliamentary  Committee  to  inquire  into  the  coal 
resources  of  Canada  was  .successful  only  in  showing  that 
Canada  could  supply  the  needs  of  every  p  ^^ut  On- 

tario.    A   partial   dependence  of  the  lattei  on   the 

United  States  could  not  be  avoided  at  the  present  price  of 
Canadian  coal  delivered  at  central  Ontario  points,  it  was 
shown.  • 

The  1921  Session 

Parliament  session  passed  198  bills,  but  111  were  bills 
granting  divorces.  Another  effort  to  get  rid  of  this  class 
of  legislation  by  the  creation  of  a  divorce  court  failed.  Among 
the  more  important  bills,  in  addition  to  those  already  re- 
ferred to,  were  bills:  which  ratified  commercial  agreements 
with  France  and  the  British  West  Indies;  which  authorised 
the  ratification  and  carrying  into  effect  of  a  protocol  accept- 
ing the  Statute  for  the  Permanent  Court  of  International 
Justice;  which  declared  certain  works  in  the  Lake  of  the 
Woods  water  systen)  to  be  for  the  general  benefit  of  Canada 
and  raised  the  question  of  provincial  rights  betweeu  tba 
Dominion  and  Ontario  by  providing  for  federal  control; 
which  embodied  recommendations  of  a  special  comntittca 
on  pensions  insurance  and  re-e.'itablishment  to  make  mora 
adequate  the  assistance  given  by  the  country  to  its  ex- 
service  men;  and  which  provided  tpr  regulating  the  gradtag 
of  dairy  produce  to  make  more  syatamatic  and  satiafactoiy 
the  market  i.iiry  prodoets. 

Other  d  the  appointment  of  a  graia 

commission  uf  investigation  which  was  Stopped  for  moMtha 
by  an  injunction,  a  Grand  Trunk  arbltratka  hOi,  a  hiU 
fixing  Thanksgiving  Day  as  the  Monday  of  ^a  tMak  in 
which  Armistice  day  occurs,  a  Copyright  Act  puiportiag  to 


16 


THE      MONETARY      TIMES 


Volume  68. 


adhere  to  the  Berne  convention,  and  an  act  combining  the 
Customs  and  Excise  departments. 

Other  Legislation 

The  following  local  and  private  acts  of  interest  to  the 
financial  world  were  also  passed: — 

Railway  and  Bridge  Companies 

Calgary  and  Fernie  Railway  Company;  Canadian  Pa- 
cific Railway  Company;  Canadian  Transit  Company;  Central 
Railway  Company  of  Canada;  Edmonton  and  Mackenzie 
River  Railway  Company;  Essex  Terminal  Railway  Company; 
Fort  Smith  Railway  Compayn;  Kettle  Valley  Railway  Com- 
pany; London  and  Lake  Erie  Railway  and  Transportation 
Company;  Maritime  Coal,  Railway  and  Power  Company, 
Limited;  Manitoba  and  North  Western  Railway  Company 
of  Canada;  Montreal,  Ottawa  and  Georgian  Bay  Canal  Com- 


pany; Mayo  Valley  Railway,  Limited;  Oshawa  Railway 
Company;  Ottawa,  Northern  and  Western  Railway  Com- 
pany; Quebec  Central  Railway  Company;  Quebec,  Montreal 
and  Southern  Railway  Company;  Thousand  Island  Railway 
Company;  Western  Dominion  Railway  Company. 

Insurance  Companies 
Dominion  Life  Assurance  Company;  Fidelity  Insurance 
Company  of  Canada;  Metropolitan  Trust  Company  of  Can- 
ada; Ensign  Insurance  Company. 

Other  Companies 
Autographic  Register  Systems,  Limited  (Patent) ;  Cana- 
dian Bar  Association;  Credit  Foncier  Franco-Canadien ;  Do- 
minion Express  Company;  Gilmour  and  Hughson,  Limited; 
Great  West  Bank  of  Canada;  James  Maclaren  Company, 
Limited;  Quebec  Steamship  Company. 


Trade  Decline  a  Significant  Feature 

Both  Imports  and  Exports  Are  Far  Below  Levek  of  1920 — 
Fluctuations  in  Exports  More  Violent  Than  in  Imports  —  An 
Examination  of  Our  Trade  With  Other  Countries  for  Pitft  Year 

BY  W.  G.  GATES,  bTa. 


THE  value  of  Canada's  total  trade  tor  the  calendar 
year  1921,  was  approximately  $1,600,000,000. 
The  final  figures  are  not  yet  available,  but  sufficient  is 
known  to  warrant  this  estimate.  There  is  very  little 
difference  between  the  figures  for  total  exports  and 
imports;  both  will  range  about  ?800,000,000,  the  pro- 
bability being  that  those  for  imports  will  be  slightly 
larger.  The  total  returns  are  a  long  drop  from  those  for 
1920,  which  stood  at  $2,639,730,042,  the  second  highest 
in  the  records  of  Canadian  trade.  This  is  one  of  the 
inevitable      features      of     the      process    of    readjustment. 


through   which  the  world  is  now  passing,  and  which  pro- 
bably will  continue  for  some  time. 

It  would,  however,  be  a  mistake  to  conclude  that  the 
volume  of  exports  had  declined  to  the  extent  indicated 
by  these  figures.  The  fall  in  prices  has  been  a  very 
important  factor  in  this  movement.  In  October,  1921, 
the  index  number  of  wholesale  prices  in  Canada  was 
229.2,  as  compared  with  317.6  for  October,  1920,  a 
decline  of  25  per  cent.  As  the  decline  in  the  total  trade 
figures  is  equal  to  38  per  cent.,  it  is  evident  that  13  per 
cent,   of  it,  or  thereabout?,  has  been   due  to  a  shrinkage 


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THB      UONBTARY      TIMB8 


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In  volume.  It  must  also  be  borne  in  mind  that  grain  has 
been  an  important  factor  In  studying  the  volume  of 
ehlpments,  the  exports  of  grain  during  the  twelve  months 
ending  Oceober  having  been  85,000,000  greater  than  they 
were  for  the  preceding  period. 

Tremendous   FaillnK  Off 

As  the  figures  for  import.s  and  exports  receive  most 
attention,  it  is  quite  probable  that,  at  first  glance,  some 
of  the  most  strilcing  features  of  the  year  may  be  over- 
looked. During  the  last  12  months  Canada  has  experi- 
enced a  trade  transition  far  beyond  comparison  with 
anything  in  her  history.  The  problems  presented  by  an 
expanding  trade  are  very  few  compared  with  those  that 
are  attended  a  severe  contraction.  During  the  war  years 
some  remarkable  advances  were  made  In  both  the  volume 
and  value  of  exports  and  the  total  trade.  For  example, 
in  1916-17  the  value  of  the  total  trade  increased  by 
$750,000,000.  But  since  January  1st,  1921,  the  trade  of 
the  country  has  sustained  a  reaction  that  has  reduced  the 
total  figures  by  no  less  than  $1,000,000,000,  or  25  per 
cent,  more  than  the  greatest  change  experienced  during 
any  previous  calendar  year.  Naturally  the  shock  has  had 
a  very   depressing  effect  on   business;    but   the  comforting 


baa  been  the  marked  decline  In  the  ralue  of  szporU.  For 
the  twelve  months  these  will  amount  to  probably  $800,- 
000,000,  as  compared  with  $1,302,805,114  for  1920.  It 
Is  true  that  while  this  decline  la  equal  to  but  30  per  emt., 
as  compared  with  41  per  cent,  in  the  case  of  ImporU, 
Btlll  It  continues,  and  from  present  indications.  Is  llkeir 
to  result  In  a  permanently  lower  level  of  exports  than  of 
Imports.  During  October,  for  example,  the  value  of 
exports  was  $50,000,000  less  than  daring  the  same  month 
last  year,  while  the  value  of  Imports  was  $4(,000,000 
less.  There  are  special  factors  operating  to  reduce 
exports  still  further,  while  on  the  other  band,  there  is 
strong  evidence  that  the  decline  in  Imports  has  touched 
bottom. 

Dealing  with  the  increases  in  the  volume  of  exports, 
the  returns  for  the  12  months  ending  December  sre  not 
yet  available;  but  during  the  year  ending  October  the 
exports  of  wheat  were  65,538,000  greater  than  during 
the  preceding  year;  exports  of  oats  were  16.691,000 
bushels  greater;  while  exports  of  other  grains  increased 
to  the  extent  of  4,500,000  bushels.  Shipments  of  sliver 
were  larger  by  1,659,000  ounces;  exports  of  llaxseed 
showed  an  Increase  of  2,500.000  bushels,  and  thos«  of 
flour   by    1,700,000   barrels. 


Trade  with  the  United  States  and  the  United  Kingdom 


J920 


Y  E.  AR 


i92l 


feature  is  that  conditions  are  no  worse  than  they  are. 
That  they  are  no  worse,  speaks  much  for  the  stability  of 
our   financial   institutions. 

Fortunately,  during  this  period  of  stress,  Canada's 
chief  industry  has  been  agriculture,  and  that  several 
other  industries  of  importance  have  had  to  do  with  the 
working  up  of  natural  products  for  export.  Had  Canada 
been  a  predominantly  manufacturing  state,  the  depres- 
sion would  have  been  much  more  severe  than  it  is.  But 
the  world  must  have  food,  and  this  country,  until  within 
the  last  few  months,  has  been  able  to  find  a  market  for 
her  large  surplus.  True,  prices  have  been  much  below 
those  of  recent  years,  but  the  point  of  chief  importance 
is  that  a  market  has  been  found.  Fortunately,  also,  the 
United  States  has  continued  to  take  large  supplies  of  pulp 
and  paper.  Indeed,  the  value  of  these  exports  alone  is 
within  hailing  distance  of  the  value  of  all  other  exports 
of  manufactures  combined. 

Tlio  r>«>cHnc   In   Kxports 

Another    of    tl\t>    important    developmenl,<!    of    the    year 


Mining  Pro<lnrt.<i  Down 

As  for  the  decreases  in  exports  during  the  year  ending 
October,  It  Is  found  that  the  mining  industry  suffered 
severely,  exports  of  coal  being  4,000,000  less  than  during 
the  preceding  period;  aluminum  exports  were  290.000 
cwts.  less;  nickel,  170.000  cwts.  leas:  asbastoa.  96,000 
cwts.  less.  The  pulp  and  paper  Industry  suffered  poasibly 
the  most  of  all,  exports  of  wood  pulp  having  dropped  to 
the  extent  of  7.394,000  cwts..  and  newsprint  by  1.219.447 
cwts.  Exports  of  lumber  also  fell  off  appreciably.  Tha 
meat  packing  industry  was  another  hit  very  hard,  exports 
of  hams  and  bacon  having  fallen  off  to  the  extent  of 
.=i0.000.000  lbs.  and  beef  by  47.000.000  lbs;  pork.  t.OOO.- 
000  lbs:  butter  export.<t  were  4.600.000  lbs.  less,  while 
cheese  fell  off  to  the, extent  of  2.600.000  Ib«,  There  were 
13.000    fewer    automobiles    exported. 

The  year's  export  figures  show  that  tha  United  States 
is  still  Canada's  best  market;  but  the  "emergency"  tariff 
is  so  reducing  exports  thereto  that  the  probabllItT  is  that 
It    will    soon    occupy  a    secondary    position.      The      total 


18 


THE       MONETARY      TIMES 


Volume  68. 


exports  to  the  United  States  were  approximately  f327,- 
000,000,  as  compared  with  $580,000,000  for  1920.  This 
drop  of  nearly  60  per  cent,  was  especially  severe,  owing 
to  the  difficulty  of  finding  in  other  parts  of  the  world  a 
market  for  Canadian  products.  The  impoverishment  of 
Europe,  whose  recuperative  powers  are  very  feeble, 
together  with  the  handicap  imposed  hy  the  rate  of 
exchange,  afford  little  ground  for  hope  that  the  situation 
in  that  quarter  will  be  much  improved  for  some  time. 
The  falling  off  in  exports  to  the  Republic  represents  a 
bigger  monetary  loss  than  is  represented  by  the  mere 
trade  figures,  for  the  exchange  alone  on  the  cost  business 
would  probably  amount  to   120,000,000. 

Eflfects  of  U.  S.  Tariff 

While  under  any  conditions  the  market  drop  in  prices 
would  have  made  it  impossible  to  maintain  the  high 
export  figures  of  1920,  still  they  would  have  been  much 
higher  than  they  were  had  it  not  been  for  the  "emer- 
gency" tariff,  as  the  following  shows:  During  the  five 
months  ending  October  the  exports  affected  by  it  were 
$17,399,000,  as  compared  with  $62,166,000  for  the  same 
months  in  1920.  In  October  alone,  the  value  of  these 
exports  was  but  25  per  cent,  of  that  for  the  same  month 
in  1920.  As  a  matter  of  fact,  in  respect  to  exports  to 
the  United  States,  the  country  is  very  nearly  back  to 
where  it  was  in  1917,  the  indications  being  that  even 
lower  levels  will  be  touched  in  this  branch  of  our  com- 
merce. If  the  market  to  the  south  were  still  as  much 
open  as  it  was  a  year  ago,  the  decline  in  exports  to  other 
countries  might  be  contemplated  with  comparative  equan- 
imity. In  October,  November  and  December  last  year 
exports  to  the  United  States  were  valued  at  $193,000,000; 
this  year  they  were   $100,000,000   less. 

Exports  by  Countries 

Though  exports  to  the  United  Kingdom  were  but 
$290,000,000  as  compared  with  $345,000,000  for  1920, 
still,  taking  into  account  the  drop  in  prices,  it  is  evident 
that  the  volume  of  trade  thereto  has  really  been  increased. 
Shipments  of  grain  and  cattle  have  been  much  heavier. 
The  slowness  with  which  some  of  the  important  produc- 
ing countries  are  recovering,  notably  Russia,  is  helping 
Canada  in  this  market. 

Exports  to  the  other  portions  of  the  British  Empire, 
generally,  were  fully  $100,000,000  less  than  they  were 
in  1920.  The  new  commercial  treaty  with  the  British 
West  Indies  does  not  seem  to  have  stimulated  exports, 
these  being  about  $2,000,000  less  than  they  were  during 
the  preceding  12  months.  Shipments  to  Newfoundalnd 
declined  to  the  extent  of  about  one-third.  Trade  with 
Australia  shows  a  decline  in  money  values,  but  apparently 
the  volume  has  not  been  much  affected.  In  the  case  of 
South  Africa,  the  value  fell  off  to  the  extent  of  50  per 
cent. 

The  decrease  in  the  value  of  exports  to  Europe  shows 
that  the  high  figures  of  1920  were  due  largely  to  the 
liberal  credits  granted  by  the  Government.  During  the 
12  months  ending  October,  exports  to  Greece  were  but 
$8,507,000,'*  as  compared  with  $34,464,000  for  the  pre- 
ceding period;  in  the  case  of  Belgium,  there  was  a  drop 
from  $41,230,782  to  $28,843,743,  and  in  that  of  Roum- 
ania  from  $11,552,000  to  $1,502,025.  France  took  50 
per  cent,  less  than  she  did  the  year  before,  and  Norway 
66  per  cent,  less;  Sweden,  75  per  cent.  less.  On  the 
other  hand,  Italy's  purchases  went  from  $33,639,663  to 
$39,455,000,  while  the  Netherlands  incre.ised  theirs  by 
2%  times.  It  is  interesting  to  note  that  Germany's  pur- 
chases went  from   $4,083,856  to   $7,397,210. 

The  Decline  in  Imports 

The  decrease  in  imports  from  $1,336,925,021  in  1920 
to  approximately  $794,000,000  in  1921,  is  another  devel- 
opment of  the  first  importance.  It  differs  from  the 
decrease  in  exports  in  that  it  represents  more  marked 
decline  in  volume;  for  though  the  lower  fl-jures,  to  a 
certain  extent,  are  explained  by  the  fall  in  prices,  still 
there   has  been   a   heavy   drop    in   the    quantity   of   goods 


imported.  The  undoubted  fact  Is  that  the  purchasing 
power  of  the  public  is  much  lower  than  it  has  been  for 
some  time  past,  this  being  especially  true  as  respects  the 
farmers.  Up  to  November  11th,  the  farmers  of  the  West 
had  delivered  132,022,412  bushels  of  the  1921  grain  crop, 
for  which  they  received  hardly  more  than  $128,000,000; 
at  the  same  date  last  year,  109,000,000  bushels  sold, 
brought  $234,000,000.  Herein  lies  one  of  the  principal 
causes  of  the  existing  business  depression.  It  is  also  a 
rather  interesting  fact  that  prosperity  is  usually  attended 
by  heavy  importing.  As  the  Western  farmers  especially 
are  heavy  buyers  of  American  products,  it  may  be  taken 
for  granted  that  the  falling  off  in  imports  from  the 
United  States  is,  in  a  measure,  explained  by  their  inability 
to  buy  to  anything  like  the  extent  they  do  during  normal 
times,  ■  It  is  interesting  to  note  that  during  the  year 
ending  October,  the  imports  of  cotton  were  valued  at 
$60,000,000  less  than  during  the  preceding  12  months; 
imports  of  iron  and  steel  were  $75,000,000  less;  rubber, 
$21,500,000      less;      silk,      $21,500,000    less;    sugar      and 

Canada's  Trade  with  United  States 


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molasses,  $33,000,000  less;  vehicles,  including  automo- 
biles, $14,000,000;  wool,  $56,000,000  less.  With  the 
exception  of  automobiles,  the  lower  figures  are  explained 
chiefly  by  lower  prices. 

United  Kingdom  Ijost  Most 

Strange  as  it  may  seem,  imports  from  the  United 
Kingdom  fell  away  more  than  those  from  any  other 
country  of  account,  and  that  in  spite  of  the  fact  that  they 
enjoy  a  preferential  tariff  rate  of  3  3  per  cent.,  to  which 
should  be  added  a  marked  advantage  through  the  rate 
of  exchange.  For  the  year,  the  value  of  imports  from 
the  United  Kingdom  was  approximately  $106,000,000, 
as  compared  with  $231,479,294  for  the  preceding  period. 
This  decrease  of  54  per  cent,  has  been  puzzling  to  most 
observers.  To  some  extent  it  may  have  been  due  to  the 
serious  strikes  in  Great  Britain;  but,  for  the  most  part, 
these  were  settled  some  time  ago.  That  the  chief  explan- 
ation is  not  to  be  found  in  labor  troubles  is  evident  from 
the  fact  that  with  the  resumption  of  work,  there  has  not 
been    an    appreciable    increase    of    British    imports.      It    is 


January  6,   1922. 


THE      MONETARY      TIMES 


!• 


more  probable  thut  the  hlRh  flKiires  for  these  Imports 
last  year  were  due  to  the  circumstance  that  during  the 
war  the  stocks  of  British  goods  had  been  completely 
cleaned  out.  This  gave  rise  to  a  huge  post-war  demand, 
which,  however,  has  not  maintained.  There  Is  also 
reason  to  thinlt  that  the  prices  asked  for  British  textlleii 
have  re.sulted  in  their  rojilacement  to  some  extent  for  the 
time  being,  by  other  goods.  Take  textiles,  fibre  pro- 
ducts and  liquor  out  of  the  British  imports  and  about 
60  per  cent,  is  eliminated  from  the  total.  At  the  present 
these  Imports  atre  now  averaging  about  $9,000,000  a 
month. 

Imports  from  United  States 

Imports  from  the  United  States  declined  very  con- 
siderably during  the  year,  but  not  to  nearly  the  extent 
they  did  In  the  case  of  the  fjnited  Kingdom.  In  1921 
they  were  approximately  $471,000,000,  as  compared  with 
$921,625,825  for  1920.  Undoubtedly  the  reduction  may, 
in  a  sense,  be  attributed  to  Canada's  inability  to  sell  as 
freely  as  formerly  in  the  American  market.  The  effect 
of  the  premium  on  American  funds,  which  is  equivalent 
to  an  increase  in  the  tariff  on  American  products,  must 
also  be  taken  into  account.  Changes  in  the  method  of 
valuing  has  also  checked  importations.  Indeed,  the 
public  does  not  realize  the  extent  of  the  increased  pro- 
tection, especially  as  against    the    United    States,    afforded 


by  the  budget  of  last  seMlon.  That  In  iplte  of  tb«M 
handicaps,  imports  from  the  Republic  have  not  fallen  ofl 
more  than  they  have,  indicate*  the  atrength  of  the  bold 
the  Americans  have  on  the  Canadian  market.  It  may 
also   be   considered   a    good  ':     of    the    defrae    tQ 

which    Canadians    are   also    o  :    upon    them.      Ereo 

with  the  marked  decrease  iu  uur  purchasing  powar, 
together  with  lower  prices,  the  value  of  Imports  darlns 
October  was  practically  the  same  as  during  June. 

Imports  from  states  within  the  Empire  generally  fall 
away,  those  from  the  United  Kingdom  bavins  already 
been  noted.  The  value  of  'those  from  tbe  East  India* 
fell  off  over  one-half,  and  the  same  may  be  aafd  of  tboM 
from  the  British  West  Indies,  Hong  Kong  and  New  Zea- 
land, while.  In  the  case  of  Australia,  there  was  a  slUl 
heavier  decline.  Imports  from  British  Guiana,  howe»er,  vara 
nearly  doubled,  while  those  from  Bermuda  also  advanced. 
Those  from  Cuba  dropi>ed  by  over  50  per  cent.,  ttaera 
having  been  marked  declines  also  In  imports  fr<HB 
France,  Japan  and  Switzerland;  while  those  from  Ger- 
many and  Switzerland  increased  materially.  The  action 
of  Parliament  in  fixing  the  minimum  value  of  certain 
foreign  currencies  for  customs  purposes,  undoubtedly  baa 
had  tht  effect  of  keeping  down  Imports  from  some  statea 
in  Europe.  Still,  insofar  as  the  trade  returns  show,  since 
the  war,  there  has  not  been  much  danger  of  Canada  being 
flooded  with  cheap  goods  from   Europe. 


Railway  Developments  During  the  Past  Year 

Grand  Trunk  Arbitration  Proceedings  and  Report  of  Operation  of  Canadian 
National  Railways  Were  the  Outstanding  Events — Opinions  on  Railway 
Situation     Presented     by     Lord     Shaughnessy     and     Sir     Joseph     Flavelle 


By  W.  T.  JACKMAN 


PERHAPS  the  most  significant  element  In  the  railway 
situation  during  the  year  1921  was  the  work  of  the 
Board  of  Arbitration  to  which  was  entrusted  the  duty  of 
ascertaining  the  value  of  the  three  preference  stocks  and 
the  common  stock  of  the  Grand  Trunk  Ry.  Co.,  preparatory 
to  the  complete  absorption  of  that  railway  property  in  the 
government  system.  The  appointment  of  the  board  was  in 
pur.iuance  of  an  agreement,  dated  March  8,  1920,  between 
the  Dominion  Government  and  the  Grand  Trunk  Railway 
Company  for  the  taking  over  by  the  Government  of  the 
Grand  Trunk  Railway  System  through  stock  ownership. 

This  agreement  provided  for  the  acquisition  of  the 
"entiie  capital  stock  of  the  Grand  Trunk,  except  the  four 
per  cent;,  gunranteed  stock"  amounting  to  $12/)00,000.  In 
consideration  for  obtaining  control  'of  the  Grand  Trunk 
Railway  Company  of  Canada  and  all  its  subsidiaries,  in- 
cluded in  what  is  called  the  Grand  Trunk  Railway  System, 
the  Government  agreed  to  guarantee  the  interest  on  the 
existing  debenture  stocks,  in  accordance  with  their  terms, 
as  follows: — 

59;    Grand   Trunk  delenture  stock    £  4,270.375 

5%   Great  Western  debenture  stock   2,723.080 

4%   Grand   Trunk  debenture  stock    24,621,155 

4%   Northern  debenture  stock    308,215 


Total  £31.926.125 

In  iM'ditH.n.  the  Govprrnment  agreed  to  issue  new  stock 
of  the  Grand  Trunk  Railway  Company  of  the  par  value  of 
£12,500.000.  with  a  guarantee  by  the  Government  at  fo>iv 
per  cent.  ;innunl  dividend  thereon,  in  exchange  for  the  then 
out  tending  issue  of  four  per  cent,  stock  of  the  same  par 
value,  guarr-nteed  by  the  Grand  Truflk  Railway  Company, 
which  was  non-cumulative  but  prior  in  its  claim  on  earnings 
to  the  preferred  and  conini6n  sfock.  The  voti/ig  powers 
posses;  ed  by  the  debenture  and  guaranteed  stocks  were  to 
cease,  trnd  all  voting  po%vers  were  to  vest  in  the  preference 
and  common  stocks. 


The  agreement  provided  alpo  that  the  fim  preference 
(6%)   stock  amounting  in  par  value  to  £3.420,000,  the  sec- 
ond prcfennce     {b%)    stock    amounting    to    £2,530,000,  the 
thiri  preference    (4'7r)     stock    amounting    in  par    value  to, 
iE2a.i§6.437,    should  be  Uken  over   by  the  Govemment_at«Kv 
;[gjj68J56rand^the  comnftn  rtwk  amoiintiny  in  ^t  valueGV) 
valuation  to  be  determined  by  a  boerd  of  arbitration,  andin 
exchange  for  these  stocks  the  Government  should  issue  "new 
guaranteed  .'tock."  bearing  four  per  cent,  interest,  e<]aal  in 
amount    to    the    arbitration    value    of    the    preferenea   and 
common  stocks. 

Grand    Trunk    .\rbitraUon 

For  determining  the  value  of  theae  stocks,  therefore, 
there  was  constituted  the  board  of  arbitration  with  Sir 
Thomao  White  representing  the  Goverrcnent.  Chief  Justice 
Taft  of  tl-.e  United  States  Supreme  Court  reprcaentilic  the 
railway  company,  i-.nd  Sir  Walter  Caasels,  Jodc*  o(f  the 
Exchequer  Court  of  Canada,  as  the  chairman.  In  the 
autumn  of  1920  the  arbitrators  were  taken  over  the  mate 
lines  cf  tl  e  Grrnd  Trunk  and  Grand  Trunk  Pacific  and  on 
February  l;t,  1921,  they  l)egan  the  Uking  of  tvidenee^  Thm 
I  oard  was  to  fix  the  value  of  these  atocka  as  of  May,  1920, 
and  its  report  was  expected  to  be  ready  by  April  9.  1921. 
nine  months  after  ita  appointment.  The  p'  ■  ''^  before 

the  board  draggi-d  on  slowly,    in  spite  of  '  .tion    to 

the  company  that  the  time  for  the  arbitratoB  would  not  be 
extend  d  '  xcept  upon  terms  of  immeHiat^  f>o«res«ioa  and 
cont  ol  >f  the  rfilway  system  by  •  "ni. 

It    was    considered    bv    the  that    ccftata 

sharehold' r«  !>nd  others  in  Tnirljiui  »iro  showimr  their 
re  «ntment  at  the  taking  of  the  pr«p«>rtv  from  fhe«n  and 
were  1  ndenvourine   to  give  tV  "n*- 

n'ent  wi>»  i^ealing  hT^-hlv  v  ind 

Trunk  dinc'ois  e'er  ■■'«1«  *he 

Government's  work  •  itodar* 

eel  that  since   public  funJs    were  finance  the 


20 


THE       MONETARY       TIMES 


Volume  68. 


railway  operation  it  was  unreasonable  for  the  company  to 
retain  possession  of  the  property.  However,  a  Bill  was  later 
introduced  into  Parliament  providing  that,  upon  condition 
that  the  company  should  agree"  by  May  16,  1921,  to  hand 
over  complete  control  of  the  property  to  the  Government, 
the  arbitration  would  be  revived.  This  was  made  efTeciive; 
the  arbitration  was  continued,  and  on  September  7,  1921, 
the  reports  of  the  arbitrators  were  submitted  to  the 
Government. 

The  Board's  Award 

The  chairman  of  the  board  and  the  Government  repre- 
centative  on  the  board  agreed  in  the  award  tliat  "therejp 
no  value  in  rny  o"  t-lie  four  classes  of  pt^ks."  The  import- 
ant  facts  leading  to  this  decision  may  be  briefly  outlined: 

1.  The  maiilpulption  of  the  accounts  of  tlie  company, 
which  rendered  the  books  unreliable.  This  was  done  at  the 
instigation  of  the  chairman  of  the  directorate  in  London, 
who  preferred  to  pay  dividends,  even  though  they  were  not 
earned,  rather  than  face  an  awkward  sdtuation  by  te  ling 
the  stockholders  the  truth. 

2.  The  draining  of  the  company's  earnings  to  pay 
dividends  rather  than  using  these  earnings  to  provide  for 
the  maintenance  of  the  property  and  facilities  in  the  most 
efficient  operating  condition. 

3.  The  adaiission  of  the  President  of  the  railway  com- 
pany to  the  Railway  Inquiry  Commission  of  1916,  that,  if 
left  to  itself,  the  Grand  Trunk  must  suffer  a  crash,  and  both 
it  and  the  Grand  Trunk  Pacific  would  have  to  go  into  insol- 
vency if  the  parent  Grand  Trunk  had  to  carry  out  its 
obligation  with  regard  to  the  Grand  Trunk  Pacific. 

4.  The  enormous  amount  owing  to  the  Government  by 
the  Grand  Trunk  on  behalf  of  the  Grand  Trunk  Pacific  for 
capital  for  construction,  for  the  payment  of  fixed  charges 
and  opernting  expenses,  and  for  the  expenses  of  tihe 
receivership. 

5.  That  the  value  of  the  stock  should  be  determined  on 
the  basis  of  the  net  earnings,  actual  or  potential,  of  the 
company;  and  since  the  Grand  Trunk  System,  as  a  system 
or  group  of  interrelated  and  interdependent  companies,  has 
no  net  earnings  (but  rather  a  deficit)  and  is  not  likely  to 
have  a  surplus  of  earnings  for  many  years,  the  stock  cannot 
have  any  investment  value. 

Minority  Dissented 

The  company's  representative  on  the  arbitration  board. 
Chief  Justice  Taft,  dissented  from  the  majority  for  the 
following  reasons: 

1.  From  the  evidence  of  eminent  rallv^ay  engineers  and 
managers,  there  seems  no  reason  to  doubt  that  the  roadway 
and  the  equipment  is  in  good  condition  for  operation  and 
this  is  proved  by  its  success  in  handling  a  heavy  volume  of 
traffic,  and  in  carrying  the  immense  business  thrust  upon  it 
during  the  war  without  a  break.  (He  regarded  the  testimony 
of  the  men  whom  the  Department  of  Railways  and  Canals 
had  sent  out  to  report  upon  the  road  and  its  deficiencies  as 
an  "enthusiasm  of  condemnation"  that  injured  the  weight  of 
their  evidence.) 

2.  The  other  two  arbitrators  refused  to  allow  the 
admission  of  any  evidence  regarding  t,he  reproduction  cost 
of  the  railway  or  the  value  of  the  phjrsical  assets.  But  Chief 
Justice  Taft  considered  it  perfectly  relevant  to  the  problem 
in  hand  to  receive  evidence  both  as  to  the  reproduction  value 
of  the  railway  system  and  as  to  the  physical  value  of  the 
property  as  distinguished  from  the  reproduction  value.  Such 
evidence  is  held  in  the  United  States  as  appropriate  in 
Judging  what  a  railway  company  should  earn  and  therefore 
in  fix'ng  'ts  rates.  With  conditions  so  much  the  same  in  the 
two  countries,  and  especially  since  the  Grand  Trunk  rev- 
enues are  affected  directly  by  the  rates  in  the  United  States, 
it  would  seem  f)roper  to  adopt  the  same  rule  of  evidence. 

3.  In  the  arbitration  of  the  value  of  the  Canadian 
Northern  sto^k,  in  a  similar  proceeding  in  1917,  presided 
ovr  ^v-  flip  rh"ef  .Tustice  of  Ontario,  evidence  was  received 
as  to  the  reproduction  value  t'nd  this  was  used  in  making 
the  award.  If  that  evidence  was  relevant  in  the  Canadian 
Northern  case  is  it  not  also  relevant  in  the  Gr^md  Trunk 
case?  If  such  evidence  had  been  admitted  in  this  instance, 
it  might   have  affected    very  materially    the  opinion   of  the 


board  regarding  the  earning  capacity  of  the  road  and  its 
future  possibilities,  especially  in  view  of  the  fact  that  in  the 
United  States  the  tendency  is  to  make  the  reproduction 
value  of  railroad  property  used  economically  for  transport>- 
ation  a  proper  basis  for  fixing  rates. 

4.  Because  the  earning  capacity  of  the  company  in 
May,  1920,  was  low — when  the  nadir  of  railroad  prosperity 
in  the  world  had  Ijeen  reached — or  because  the  company  was 
almost  in  a  state  of  bankruptcy,  is  no  reason  for  saying  that 
the  interests  of  its  shareholders  were  worth  nothing.  Who 
can  say  what  would  have  happened  to  the  Grand  Trunk  if 
the  Government  had  not  taken  it  over?  Perhaps  the  bond- 
holders, who  cnme  to  its  rescue  in  1860,  might  have  come 
to  its  aid  again  and  tided  it  over  till  the  return  of  normal 
conditions. 

5.  On  the  basis  of  past  earnings  and  probable  future 
eam'ngs  (concernino:  which  statistics  are  given),  there  is 
every  reason  tx)  believe  that  within  five  years  the  conditions 
of  the  company  would  be  so  much  improved  that  it  would 
have  some  leeway  for  making  capital  expenditure  to 
improve  the  property  wthout  excluding  the  shareholders 
from  participating  in  the  benefit  of  better  times. 

Appeal  To  Privy  Council 

So  far  as  the  award  is  concerned  the  majority  ruling  is 
accepted,  but  it  is  of  little  consequence.  The  Grand  Trunk 
has  appealed  its  ccse  to  the  Privy  Council  in  England,  and 
that  tribunal  has  always  been  much  more  favorably  disposed 
to  guard  the  interes.ts  of  property.  If  it  should  admit 
evidence  concerning  the  replacement  value  of  the  Grand 
Trunk  System — and  from  its  past  decisions  there  seems  to 
be  good  reason  for  anticipating  that  it  will — it  is  almost 
indubitable  that  the  ra.ilway  shareholders'  c'aims  will  be 
adjudged  fairly  large,  probably  larger  than  the  maximum 
amount  v/hich  the  Senate  fixed  as  compensation  for  these 
four  stocks,  namely,  $64,166,666.66. 

To  one  wlio  looks  with  impartiality  upon  the  results  of 
the  arbitrafon  in  the  cases  of  the  Canadian  Northern  and 
the  Grand  Tiunk  stocks  there  is  something  avowedly  antag- 
onistic to  cny  sense  of  justice.  In  the  former,  the  stock- 
holders of  the  $60,000,000  of  common  stock  had  never  put  a 
dollar  into  the  property  and  yet  this  stock,  which  had  been 
shown  by  the  Railway  Inquiry  Commission  of  1916-17  to 
represent  "no  cash  investment,"  and  to  have  "no  present 
value,"  either  on  the  basis  of  reproduction  cost  or  earning 
power,  was  awarded  a  value  of  $10,800,000  by  the  board  of 
arbitrators;  whereas  the  stocks  of  the  Grand  Trunk  which 
are  the  subject  of  this  arbitration,  amounting  to  over 
£37,000,000,  to  roughly  $180,000,000,  all  of  which  was  "fully 
paid  up  in  cash,"  were  declared  by  the  majority  of  this 
board  of  arbitration  to  be  valueless. 

Is  the  Award  Unfair? 

Is  it  possible  that  in  the  case  of  the  Canadian  Northern 
there  were  interests  which  the  Government  did  not  want  to 
see  exposed  to  loss  on  account  of  unsatisfactory  financing, 
while  in  the  case  of  the  Grand  Trunk  there  were  no  friends 
at  court  to  safeguard  the  interests  of  those  who  had  invested 
their  money  in  the  enterprise?  I  merely  suggest  this 
question,  and  there  are  those  who  know  well  the  answer. 
Moreover,  is  there  any  justice  in  admitting  as  evidence  in 
the  case  of  the  Canadian  Northern  the  reproduction  \alae 
of  the  property,  and  using  this  in  arriving  at  a  decision 
concerning  the  value  of  the  stock,  whereas  in  the  similar 
case  of  the  Grand  Trunk  stock  such  evidence  is  refused  by 
another  board  of  arbitrators?  Again  we  ask.  Was  there  a 
method  in  this  madness?  If  the  boasted  advantages  of 
arbitration  as  a  means  of  settling  justly  such  a  very  import- 
ant pro'lem  as  the  value  of  a  great  railway  system  can  be 
upheld  by  such  discriminatory  application  of  the  princip'e 
as  that  manfested  in  these  two  cases,  it  is  not  a  principle 
v/hich  can  command  the  confidence  of  judicious  and  fair- 
minded  people. 

The  National  Railways 

The  second  important  feature  in  the  railway  interests  of 
Canada  during  the  year  .just  closed  was  the  annual  report 
made  by  the  Minister  of  Railways  and  Canals  to.  Parliament 
in  March,  1921.  The  deficit  on  the  government  railways, 
which  in  1919    amounted   to  almost   $50,000,000,     was  shown 


January  6,   1922. 


THE      MONETARY      TIMEC 


n 


to  have  increased  in  1920  to  about  $70,000,000.  These  figures 
do  not  include  interest  on  the  capital  of  the  National  Trans- 
continental and  the  Intercolonial  railways;  but  as  the  capital 
for  these  lines  was  furnished  by  the  governments  of  the 
country,  nnd  interest  on  this  capital,  under  a  strict  account- 
ing, would  be  paid  by  one  branch  of  the  government  to 
another,  we  may  neglect  this  portion  of  the  deficit. 

An  increase  in  the  railway,  deficit  of  almost  50%  within 
one  year  calls  for  explanation  and  is  the  occasion  for  a 
serious  consideration  of  railway  affairs.  The  announcement 
of  such  a  result  by  the  Minister  of  Railvirays  and  Cana  s 
crcnted  a  sensation  in  Parliament  and  throughout  the 
country,  which  has  brought  the  railway  problem  into  tlie 
forefront  of  national  ii^sues.  The  demand  on  the  part  of  the 
Parliament  and  the  publiw  for  a  thorough  investigation  of 
the  affairs  of  the  government  railv/ays  so  as  to  make  public 
the  essential  information  by  which  to  judge  as  to  the  admin- 
if.tration  of  these  railways,  was  met  by  the  appointment  of  a 
committee  of  inquiry  of  the  House  of  Commons  on  Canadian 
National  Railways  and  Shipping.  i^ 

Committee  of  Parliament 

This  comn  ittee,  coiiipos-ed  of  members  of  the  three 
partita  in  the  House,  were  eitrictly  limited  in  its  functions, 
its  first  and  irost  nportant  duty  being  to  determine  what' 
information  concerning  these  governmental  agencies  could  be 
given  with  propriety  to  the  public.  Information  was  obtained 
by  the  committee  as  to  the  increased  cost  of  operation,  attend- 
ant upon  the  very  high  wages  and  high  cost  of  materials,  the 
method  of  letting  contracts,  the  system  of  auditing,  etc.  The 
committee  recommended  that  it  should  be  reappointed  early 
in  the  next  spssion  of  Parliament  to  complete  its  inquiry,  but 
until  it  should  be  able  to  give  more  careful  consideration  to 
the  railway  issues    and    to  obtain    furtlier   knowledge    it  did 

"not    feel    di  po  ed to    make   definite    reply"     to  the 

questions  referred  to  it.  Neither  this  committee  nor  the 
Government  had  ;'ny  definite  plan  for  dealing  with  the  rail- 
way problem;  the  Government  simply  a'lowed  the  matter  to 
drift  on  and  passed  an  appropriation  of  $165,000,000  for  the 
year  1921. 

But  there  are  others  who  have  been  thinking  about  the 
remedies  for  the  serious  condition  of  the  publicly-owned 
railways  and  two  of  these  are  inen  who  stand  high  in  the 
railway  rnd  inrlust-ial  world.  Because  of  the  wide  attention 
which  has  Veen  nttracted  by  their  public  statements,  it  is 
important  thnt  the  latttr  should  be  considered  here. 

Lord  Shaughnessy's  Advice 

Lord  Shaughnessy,  chairman  of  the  Canadian  Pacific 
directorate,  sent  to  Premier  Meighen  a  letter,  dated  April  6, 
but  not  made  public  till  .April  24,  in  which  he  reviewed  the 
history  and  present  conditions  of  the  railways,  and  set  forth 
his  pirn  lor  reliev'ng  the  people  "from  some  part  of  the 
distressing  and  dangerous  financial  results  now  in  evidence 
and  which  ihi-eiiten  the  future."  Briefly,  his  policy  was  to 
leave  the  Grand  Trunk  Sy.stem  under  private  ownership  and 
operation  and  to  bring  promptly  and  effectively  to  the  aid  of 
the  National  Railway  System  additional  financial  strength 
and  sustenance  by  having  the  national  rai'ways  merged  with 
the  Caiiadi-n  Pm-ific  for  operation  and  management. 

He  would  have  all  the  extraneous  assets  of  the  Canadian 
Pacific  (iiicluiling  its  ownership  of  railways  in  the  United 
Stat.es,  its  ocean  steamships,  its  lands  still  owned,  etc.1  seg- 
regated from  the  company's  Canadian  system  of  railways, 
vessels,  .ind  other  accessories  nnd  this  latter  would  be  joined 
with  the  nnt'ona'  railways  under  the  comprehensive  organi- 
zation of  fhe  Canadian  Pacific  for  administration  and 
operation.  Tn  consideration  for  the  Canadian  Pacific  share- 
holders giving  up  their  interest  in  the  return  from  the 
extraneous  as-et-s,  which  would  then  be  under  separate  man- 
agement, the  Government  would  enter  into  a  coptract 
approaching  perpetuity  wth  the  Canadian  Pacific  by  which 
the  company  would  operate  the  whole  property  for  account 
of  the  Canadian  jieople.  Tlie  Government  would  agree  to  pay 
the  shareholders  in  perpetuity  a  fixed  annual  dividend  on  the 
share  capital,  to  be  supplemented  by  a  further  payment  when 
the  whole  property  was  yielding  a  specified  return. 

By  having  the -e  properties  all  operated  by  one  manage- 
ment,  there  would  be   so   many   economies   effected   that  the 


I   of  which 
II' I  a  conittrnct- 


operating  ratio  v;ould  be  ii;..u....i  .lum  o>/out  lOl'/o  to  a 
maximum  of  80%,  which  would  reduce  the  total  annaal 
deficit  to  eleven  or  twelve  million  dollari.  Gradually  even 
this  would  be  overcome  through  sctticment  of  the  country 
and  increase  of  trufHc;  and  in  the  meantime  the  saving  to 
t;he  country  would  be  very  large.  There  ii>  no  question  what- 
ever that  the  plan  outlined  by  this  gre;- '■■    •    ■  •-• -an 

would  be  of  inestnmable  benefit,     in  ovi  al 

handicap  of  the  national  railways  and  p 
with  transport-jtion  facilities  in  the  n. 
there  would  be  shown  enterprise,  initial 
ive  nat  onal  <.ut!ook.  If  this  plan  were  accepted  the  details 
would  have  to  be  worked  out  carefully;  but  thus  far  the 
Government  has  i-hown  no  inclination  to  depart  from  its 
present  policy  of  c'ri't'ng  and  piling  up  of  deficits.  The 
report  of  the  Railway  Inquiry  Commission  had  shown  some 
of  the  advantages  from  ccnrolidation  of  railways,  and  thia 
plan  developed  by  the  former  President  of  the  Canadian  Paci- 
fic was  simply  carrying  out  the  principle  of  consolidation  to 
its  logical  conclusion,  under  the  most  hopeful  condition*  for 
imminent  .success. 

It  is  worth  not'ng  here  that  the  scheme  devised  and  pat 
into  operation  in  England  for  readjusting  the  railway  rela- 
tions since  the  period  of  government  control  has  been 
abandoned  involves  the  creation  of  four  large  sy.-tems,  each 
with  a  complete  monopoly  in  its  own  territory.       Evidently, 

then,  monopoly  does  not  have  the  sane  terror  fori 'h 

people   as  it  has  for    some  <!raven-hearte<l    parli:.  ns 

and  nev.-ppaper  editors  in  this  country,  who  are  ■•  in 

their  denunciations  of  a  railway  n.onopoly  and  f;  )i- 

orouB     in     proclaiming     the     supposed     virtues     of     public" 
ownership. 

Sir  Joseph  Flavelle's  Recommendations 

The  other  public  man  whose  contribution  upon  the  rail- 
way problem  has  been  sent  to  the  Government  is  Sir  Joseph 
Flavelle,  who  during  recent  months  has  been  the  tempory 
chairman  of  the  Comr.iittce  o!  M;;nagement  of  the  National! 
Railways.  After  reviewing  some  aspects  of  the  railway 
history   he  showed    the  financial    necessities   of  the    National 

System,    involving   capital   expenditures    in    the    • "'iite 

future  amounting  from    $125,000,000  to    $175,00«  '\ 

wlil  contsitute  a  new  fixed  charge  of  $10,000,000  pn  ..iii.am 
in  addition  to  the  present  fixed  charges.  (This  is  in  great 
contrast  to  the  entire  fixed  charge*  of  the  Canadian  Pacific 
Railway  %vhich  stand  at  $15,910,516.>  Moreover,  the  operat- 
ing loss  for  the  year  1921,  estimated  by  that  of  the  first  »lx 
months  of  the  year,  will  exceed  the  governmental  estimate. 
He  emphasized  the  urgency  of  keeping  politics  out  of  the 
management,  the  necessity  of  the  people  using  their  own 
road,  the  importance  of  a  well  developed  settlement  policy 
for  the  unoccupied  lands  of  the  West,  as  well  as  for  tho«e 
lands  cont'guous  to  the  railways;  and  while  acknowledging 
that  economies  would  result  from  the  complete  integration 
of  all  the  components  of  the  National  System,  he  was  care- 
ful to  warn  againr.t  the  belief  that  these  economies  would  '>e 
immediately  reflected  in  reduced  operat-- -   ■ 

Hia    calculations    showed    that  the  ' 
when  fuilv  completed    by  the  it    '         '  -'"     "u  ■» 

lines,  vould  have  net  fixed  ch  <66.000,000 

per  year.  His  plan  for  meeting  vm'  s:tii  *~  -■ '  -re 

the    railway    company — "the  Pominion  e 

relieved  except  through  incren=    '         -■ 

That  the  new  National  Ra  ^ 

nom-nal  auhorized  capital  stock  oi    ?. 
of  $500,000,000  of  common  stock  and  $5" 
ence   16%)    stock;     and  that  the  G 
shares   at  par   in  payment  of  its   r 
various    systems.       Those  adv.nnces    on 

amounted  to   $320,000,000  of  loans  and  ^  1 

Trunk  P.".cific  debonture.'s.     The  cost  of  • 
National  Tran.scontinental  railwa<-s  she 
orce.     For  the  future,  rny  exr 
be  charged  to  capit'il  should  bl- 
and for  these  advances    f- 
should  rece've  preference 
Government   had  to  meet    «h'vii(l  re  -.t 
Government  common  stock  at  par.    The 
isme   preference    stock    only    against    c^p 


t    r^r 

7 


22 


THE      MONETARY      TIMES 


Volume  68. 


advanced  by  the  Government,  and  the  common  stock  would 
be  issued  to  the  Government  in  payment  of  its  advances  to 
meet  operating  deficits,  including  fixed  charges.  In  this  way 
the  common  stock  would  represent  the  cost  of  acquiring  the 
system  plus  the  amount  of  the  operating  deficits  from  year 
to  year;  and  the  preference  stock  would  represent  the 
amount  of  capital  expenditure  made  by  the  Government 
upon  the  rcilway  system  after  its  unification.  Of  course,  the 
obligations  of  the  railway  company  to  the  outside  public 
would  be  represented  by  the  bonds,  debentures  and  guaran- 
teed stock  outsta.iding. 

Of  the  many  criticisms  of  this  plan  which  suggest  them- 
selves to  the  thinking  mind,  I  shall  mention  but  one,  namely, 
if,  as  Sir  Joseph  states,  "the  annual  deficits  in  operation  and 
fixed  charges  are  an  actual  and  irrecoverable  loss,  and 
should  not  be  carried  as  an  active  debit  against  the  railway," 
why  not  honestly  though  sorrowfully  charge  them  off  as 
losses  instead  of  using  them  to  swell  the  capital  stock 
account  of  the  Government?  If  they  are  losses  that  are 
irrecoverable,  they  can  never  be  transformed  by  any  account- 
ing device  into  capital  in  the  hope  that  some  dim  and  distant 
day  in  the  future  the  company  will  be  able  to  pay  dividends 
upon  them. 

In  this  contribution  to  the  railway  problem  by  one  who 
has  been  a  very  successful  business  man  and  who  has  rend- 
ered di'^tinguished  service  to  his  country,  we  find  too  man^ 
"ifs"  and  other  conditional  statements  to  give  any  comfort  to 
the  supporters  of  the  policy  of  public  ownership.  Indeed, 
that  does  not  seem  to  have  been  the  primary  purpose  in  its 
writing,  but  rather  to  tell  the  truth  about  the  railv/ays,  no 
matter  how  harsh  the  truth  mny  be. 


EXTENSION    OP    BANKING    SERVICE 


Fewer    Branches    Opened    in    1921 — Many    Closed — A    New 
Field  Opened — "Premises"  Account  Shows  Big  Increase 


pXTENSION  of  banking  service  in  Canada  during  the 
I-*  year  1921  has  been  but  a  small  fraction  of  that  of  the 
previous  two  years,  when  a  record  was  established.  In 
1919  almost  a  thousand  new  branches  were  opened,  while 
in  the  following  year  a  little  less  than  half  this  number  of 
offices  were  put  into  operation.  Last  year's  figures  show 
that  only  about  two  hundred  additional  branches  started 
business. 

A  feature  of  the  twelve  months  that  have  gone  is  that 
against  the  branches  that  were  opened,  some  one  hundred 
were  closed.  This  was  perfectly  natural  in  view  of  the  de- 
pression coming  after  an  extended  period  of  inflation.  As 
one  banker  has  put  it,  the  policy  of  bankers  generally,  in 
the  past  year,,  has  been  one  of  consolidation  rather  than 
extension. 

The  branch  system  has  been  one  of  the  chief  factors  in 
the  upbuilding  of  the  country,  as  by  it  the  banks  have  been 
able  to  furnish  the  necessary  accommodation  to  all  classes 
of  business  in  Canada,  whether  farmers,  merchants  or 
manufacturers,  at  rates  which  compare  most  favorably  with 
those  current  elsewhere. 

The  elasticity  of  the  system  is  also  very  convenient,  as 
has  been  demonstrated  in  the  past  three  years.  Some  were 
of  the  opinion  that  the  opening  of  branches  was  somewhat 
overdone,  but  the  great  activity  in  this  regard  was  only  in 
conformity  with  the  enormous  expansion  in  business.  As 
soon  as  deflation  set  in  the  banks  changed  their  policy 
immediately.  Only  a  few  new  branches  were  opened  each 
month,  as  the  occasion  called  for,  while  a  number  of  offices 
were  closed,  and  this  process  has  been  going  on  for  the 
past  few  months. 

Districts  which  had  offered  good  opportunities  for  bank- 
ing business  during  the  period  of  prosperity,  no  longer 
needed  such  an  extensive  service,  and  where  they  could 
safely  and  fairly  do  so,  the  banks  eliminated  branches 
which  did  not  pay  their  way. 

A  notable  fact  is  that  during  the  period  of  jxpanslon 
an  enormous  number  of  sub-branches  were  opened,  and 
that  during  the  past  year  it  was  largely  the  sub-branches 


that  were  being  closed.  For  instance,  in  August,  1921, 
fourteen  branches  were  closed,  of  which  seven  were  subs.' 
During  the  same  month  fifteen  branches  were  opened,  of 
which  nine  were  subs. 

Sub-branches  as  a  general  rule  are  under  the  super- 
vision of  a  main  branch,  and  are  open  only  part  of  the 
week.  By  this  means  the  banks  can  easily  take  care  of 
increasing  business,  and  if  by  chance  that  business  should 
fall  away,  it  is  a  simple  matter  to  close  the  branch,  and  no 
loss  is  involved.  Thus,  it  is  seen  that  the  branch  system 
is  quite  elastic,  contracting  and  expanding  readily  to  the 
country's  needs. 

Pioneer    Banking 

A  unique  feature  of  last  yearns  branch  banking  was  the 
entrance  of  the  Union  Bank  of  Canada  into  the  North- 
western oil  field.  This  is  Just  another  example  of  the  way 
in  which  the  Canadian  banks  are  endea/oring  to  take  eare 
of  the  country's  requirements. 

B.  C.  Beyer  was  given  charge  of  the  new  venture,  and  he 
established  the  branch  in  the  Mackenzie  district.  Alberta, 
at  Fort  Smith.  It  is  not  to  be  expected  that  this  new  office 
can  become  a  profitable  enterprise,  particularly  in  its  initial 
stages,  but  it  is  characteristic  of  Canadian  banking  that  the 
banker  should  accompany  the  forerunners  of  civilization 
and  development  in  any  movement  toward  progress. 

Not  since  the  Yukon  was  penetrated  by  the  Bank  of 
Montreal  in  1898,  has  a  more  romantic  and  possibly  more 
difficult  pioneering  mission  been  given  to  a  Canadian  banker 
than  Mr.  Beyer's  assignment. 

The  branch  was  opened  in  rather  a  crude  fashion, 
business  being  carried  on  first  of  all  in  a  tent.  Notwitth- 
standing,  it  was  a  convenience  that  the  Inhabitants  of  the 
community  could  not  have  easily  dispensed  with. 

Extension  of  the  bank's  business  in  the  foreign  field  has 
been  covered  fully  elsewhere  in  this  issue.  It  might  be 
said  here,  however,  that  the  developments  were  not  very 
outstanding,  as  might  have  been  expected  under  the 
circumstances. 

Bank  Premises 

It  is  quite  apparent  that  although  the  number  of 
branches  opened  was  smaller,  more  elaborate  offices  were 
established,  if  the  column  showing  the  value  of  bank 
premises  in  the  bank  statement  each  month  is  any 
indication. 

Over  the  twelve  months  there  has  been  an  increase  in 
the  value  of  premises  of  about  $9,000,000,  as  compared  with 
$5,000,000  in  1920,  and  about  $2,500,000  in  1919. 

It  might  be  suggested  that  the  property  already  held  has 
appreciated  in  value,  but  the  banks  are  net  allowed  to 
show  appreciation,  although  they  must  make  provision  for 
depreciation. 

Of  course,  the  above  figure  might  represent  new  banks, 
it  being  most  probable  that  a  good  deal  of  property  now 
held  by  the  banks  is  yet  to  be  builded  upon,  when  the 
occasion  calls. 

The  following  table  shows  the  trend  of  the  "bank 
premises"  account  over  the  past  three  years:  — 

1919.  1920.  1921. 

January    $  52,801,507  $  56.500,332  $  62,340,796 

February    53,005,275  57,207,547  63,406,980 

March    _ 53,317,635  57,946,975  63,334,165 

April     54,443,467  55,317,655  64,400,435 

May    53,898,884  56,459,647  64,864,981 

June    54,315,064  57,192,011  65,179,760 

July    54,667,642  57,896,005  65,939,192 

August    56,014,766  58,554,076  67,027,677 

September   55,464,363  59,297,890  67,508.091 

October  55,602,824  60,125,795  68,153,284 

November   55,518,536  60,467,669 

December    55,944,018  60.376,915 

On  another  page  is  given  a  table  showing  the  situation 
of  bank  branches  at  the  present  time,  and  the  total  as  com- 
pared with  a  year  ago. 


January  6,  1922. 


THE      MONETARY      TIMES 


23 


Provinces'  Invasion  of  the  Banking  Field 

Credits  Grsuited  to  Farmers  Under  Co-operative  Schemes 
— Too  Generous  Credit  May  Be  An  Evil,  However — 
Country     is     Well     Served     by     Banking     Institutions 


By  O.  A.  HAEPER 
Of  J.  L.  Elvin,  Ltd.,  Winnipeg 


OF  the  many  changes  arising  out  of  the  general  social 
of  the  most  hadical  is  that  of  governments  entering 
the  (iold  as  money  lenders,  competing  with  our  banl<s  and 
other  financial  institutions  in  financing  agriculture,  partic- 
ularly in  those  provinces  where  the  organized  farmers 
dominate  politics.  The  past  year  seen  vast  strides  forward 
in  this  field  of  government  activity  and  while  disaster  or 
something  bordering  on  it  is  predicted  by  shrewd  finan- 
ciers, yet  it  is  votes  that  elect  governments  and  at  present 
these  financiers  are  not  the  majority  of  voters.  Govern- 
ment banking  departments  are  still  very  much  in  the  ex- 
perimental stages,  and  it  is  interesting  to  study  their  ex- 
perience and  progress  to  date. 

Started  in  the  West 

The  movement  had  its  inception  on  the  prairies,  being 
confined  to  Provincial  Government  activities  with  Manitoba 
taking  the  lead  and  the  other  provinces  ba.sing  their  acts 
largely  on  those  of  Manitoba.  The  original  plea  was  to  help 
farnier.s  in  outlying  and  unorganized  districts  where  credit 
was  not  available  at  any  price,  due  either  to  weak  financial 
position  of  borrowers,  the  very  liberal  exemption  laws,  or 
to  great  di.stance  from  any  bank  or  financial  institution.  On 
the  above  grounds  the  movement  had  the  co-operation  and 
assistance  of  bankers,  but  it  soon  resolved  itself  into  a  matter 
of  cheap  money  and  plenty  of  it,  resulting  in  the  new  activi- 
ties of  the  past  year  as  recorded  below. 

In  1916  Manitoba  put  into  operation  its  Farm  Loans 
Act  to  provide  farmers  with  money  for  first  mortgages  on 
farm  lands  at  six  per  cent,  per  annum,  repayable  in  equal 
annual  instalments  amortized  over  a  period  of  thirty  years. 
It  was  found  that  this  rate  did  not  pay  the  cost  and  after 
considerable  argument  the  rate  was  last  winter  raised  to 
seven  per  cent. 

Manitoba   System 

Then  in  1917  Manitoba  passed  the  Rural  Credits  Act, 
thus  taking  its  first  step  into  the  active  banking  field,  which 
has  led  up  to  actively  engaging  in  banking  in  1921.  Under 
this  act  farmers  could  band  themselves  together  in  societies 
of  from  35  to  50  members  in  each.  Each  farmer  subscribed 
for  .$100  of  capital  stock  of  which  he  paid  up  ten  per  cent. 
The  municipality,  wherein  the  society  was  located,  and  the 
Provincial  Government  would  each  subscribe  for  half  the 
amount  of  stock  as  the  farmers  and  likewise  pay  up  ten 
per  cent.  The  society  would  then  elect  directors,  of  whom 
one  half  would  be  representative  of  the  municipality,  and 
the  province.  They  would  then  borrow  money  from  a  local 
bank,  if  possible,  to  finance  their  members  at  an  arbitrarily 
fixed  rate  of  seven  per  cent,  per  annum,  one-seventh  of  which 
mlist  be  rebated  by  the  bank  to  the  society  to  defray  its 
expenses.  Thus  a  society  of  fifty  members  would  have  a 
subscribed  capital  of  $10,000,  and  a  paid  up  capital  of  $l,t)00, 
as  security  for  it»  loan^  in  addition  to  the  personal  obligation 
of  each  borrower  on  his  own  note.  The  act  also  did  away 
with  all  exemptions  of  a  member  as  against  his  society  and 
in  addition  the  society  had  an  automatic  lien  on  all  the  pro- 
perty of  a  member  for  the  amount  of  his  loan. 

The  net  interest  rate  of  six  per  cent,  to  the  banks  was 
riot  sufficient  to  defray  the  cost  of  doing  business  in  sparsely 
settled  distribts,  and  after  carrying  on  at  this  rate  tilf  1920, 
they  finally  requested  either  that  in  1921  the  government 
guarantee  then  against  loss  or  grant  an  increase  in  interest 
rate.  The  government  declined  to  grant  either  of  these  re- 
quests, and  as  an  alternative  entered  the  field  actively  and 
took  the  full  responsibility  of  making  the  loans  direct.    This 


course  of  action  was  decided  on  during  the  winter  gessioiu 
of  1921.  As  the  interest  rate  was  not  .sufliicient  to  meet  the 
cost  the  legislature  appropriated  $.30,000  for  the  e)(penBe 
of  the  department,  which  from  such  figures  a.s  are  available 
is  from  one  and  one-half  to  two  per  cent,  per  annum  on  the 
average  loans. 

In  order  to  raise  fund.s  for  loaning  purposes,  the  legis- 
lature during  the  same  .session  arranged  to  open  offices  and 
take  savings  deposits  subject  to  checking  privileges  on  which 
they  allow  intere.st  at  four  per  cent,  per  annum.  They 
have  since  opened  two  offices  in  the  City  of  Winnipeg  for 
this  purpose,  and  also  have  about  ten  agents  in  outside 
points  acting  on  their  behalf. 

At  the  time  of  writing,  deposits  are  reported  to  have 
passed  the  $.3,000,000  mark  and  loans  to  have  reached  |3,- 
000,000,  which  is  the  maximum  figure  set  by  the  act.     It  is 
evident  therefore  that  the  loans  are  at  their  peak  at  a  time 
of  year  when  they  should  be  at  the  ebb,  and  practically  all ' 
of  the.se  loans  will  have  to  be  carried  over  for  at  least  anr*"^'  " 
year,  if  not  longer.     A  portion  of  these  loans  are,  of  n 
for  purposes  which  are  recognized  as  two  year  loans,  out 
the  fact  that  loans  have   increa-sed  during  the  fall   of  the 
year,  combined  with  the  fact  that  loans  up  to  $5,000  to  one 
man  are  common  would  make  it  appear  that  under  pres<>nt 
market  conditions  one  of  two  things,  or  possibly  both, 
happen.     Either  heavy  losses  must  be  born  by  the  pro', 
or  the  government  must  take  advantage  of  the  clause  waiv- 
ing all  exemptions  and  sell  all  that  many  borrowers  possess. 
I   shall   leave  the  reader  to  his  own  opinions  as  to  which 
would  be  the  more  disastrous. 

Other  Provincial  Systems 

The  Province  of  Saskatchewan  put  in  operation  an  act 
similar  to  the  Manitoba  Farm  Loans  Act,  but  refrained  from 
taking  the  responsibility  of  making  unsecured  advances  for 
current  farming  operations.  There  has  been  agitation  from 
time  to  time  for  either  government  or  individual  banks 
similar  to  the  American  banking  system,  but  the  provincial 
treasurer  wisely  took  the  stand  that  in  a  province  such  as 
Sa.skatchewan  the  pre.^ent  banks,  with  vast  sources  of  funds 
outside  the  province,  could  best  serve  the  people.  A  province 
depending  .so  largely  on  one  crop,  and  where  everyone  re- 
quired to  borrow  at  the  same  .season  could  not  possibly  sup- 
ply its  own  funds,  and  at  other  sea^ions  when  borrowing 
was  at  a  minimum  there  would  be  a  surplus  of  inactive 
funds. 

Alberta,  on  the  other  hand,  already  had  on  its  books 
an  act  similar  in  almost  ever>'  respect  to  the  Manitoba  Rural 
Credits  Act.  This  act  had  not  been  taken  advantage  of  to 
any  great  extent,  and  last  spring  the  government,  in  order 
to  give  greater  assistance,  undertook  to  guarantee  all  such 
loans  to  the  banks,  and  also  to  allow  the  individual  societies 
some  latitude  as  to  paying  a  slightly  higher  interest  rate  to 
the  banks.  This  province  thus  took  advantage  of  the  trained 
and  established  banking  staffs  and  organization,  both  .i-  '.o 
granting  loans,  and  more  important  still,  as  to  coUectinK 
them. 

During  the  past  year  Ontario,  under  a  Farmer  Govern- 
ment, has  passed  and  is  now  putting  into  force  two  arM 
similar  to  those  in  Manitoba.  The  Ontario  Farm  Loans  Act 
in  terms,  rates  and  general  particulars,  follows  the  Rural 
Credits  Act  of  Manitoba.  Under  it  local  organizations  are 
incorporated  ai\d  members  may  apply  for  loans  to  cover 
the  purchase  of  seed,  feed,  fertilixers.  farm  implements,  or 
live  stock,  or  to  cover  the  cost  of  preparing  or  cultivating 


24 


THE       MONETARY       TIMES 


Volume  68. 


Canadian 
Government  and 
Mnnicipal 
Sonds 


possess  all  the  eleitieiits 
tliat  go  to  make  an  at- 
tractive investment.  The 
principal  is  secured  by 
safeguards  of"  the  highest 
type.  Interest  is  prompt- 
ly paid  and  conveniently 
collected  and  these  bonds 
will  be  found  to  be 
amongst  the  most  readily 
saleable  of  all  securities 
should  occasion  demand 
immediate  cash. 

We  deal  exclusively  in 
bonds  of  this  nature,  and 
our  facilities  for  buying 
and  selling  such  secur- 
ities, as  well  as  our  exper- 
ience in  selecting  the 
bonris  best  suited  to  in- 
dividual requirements,  is 
gladly  placed  at  your 
disposal. 

Consult  us  about  your 
investment  problems. 


Victory 
Bonds 


Bought 

Sold 

Quoted 


Wood,  Gundy  &  Company 


Montreal 

36  King  Street  West 

New  York 

Winnipeg 

Toronto 

• 

London,  Eng. 

January  6,  1922. 


THE      MONETARY      TIMES 


25 


the  soil,  or  to  take  out  life  insurance  as  collateral.  Loans 
to  any  one  member  are  limited  to  $1,000,  whereas  in  Mani- 
toba loans  of  $2,000,  $.3,000  and  even  $5,000  are  quite  gen- 
eral. The  Agricultural  Development  Act  provides  for  mort- 
gage loans  in  a  similar  manner  to  the  Manitoba  Farm  Loans 
Act. 

In  order  to  finance  these  operations  Ontario  has  author- 
ized the  provincial  treasurer  to  open  offices  at  desirable 
points  and  to  accept  deposits  and  some  half  dozen  s-ub- 
treasury  offices  are  now  being  opened  and  put  into  operation. 

Reasons  For  Growth 

As  already  stated,  general  movement  for  rural  credits 
originated  and  was  built  up  on  the  plea  of  helping  the  poorer 
farmers  and  farmers  in  unorganized  or  sparsely  .settled  dis- 
tricts to  obtain,  if  honest,  the  necessary  credit  to  carry  on 
by  means  of  co-operation,  when  they  were  otherwi.se  unable 
to  obtain  that  credit  through  ordinary  banking  channels, 
either  on   account  of  their  weak  financial  position,  the  gen- 


erous exemption  laws  or  their  distance  from  a  local  banking 
office,  or  from  all  three.  To  these  people  the  vital  quet>tion 
was  that  of  obtaining  credit  at  all  rather  than  of  obtaining 
loans  at  six  or  seven  per  cent.  As  such  the  movement  gained 
both  the  active  and  sympathetic  support  of  bankers  and  busi- 
ness men  generally.  The  credit  was  needed,  and  this  system 
provided  a  means  for  a  man  to  prove  his  honesty  and  ability 
by  having  his  neighbors  in  the  same  occupation,  who  knew 
his  daily  habits,  co-operate  in  judging  his  fitness  to  receive 
such  a  loan.  It  also  provided  him  with  a  means  of  giving 
.security  otherwise  denied  under  the  exemption  laws  of  his 
province. 

Too  generous  credit  is  as  great  an  evil  as  its  counter- 
part— too  little  credit.  While  the  final  re.sult  of  the  Manitoba 
act  as  compared  with  established  banking  methods  is  yet 
to  be  determined,  it  behooves  Ontario  to  go  slowly  and  take 
advantage  of  Manitoba's  experience,  as  there  are  very  few 
districts  that  are  not  already  supplied  with  readily  accessible 
banking  accommodation. 


Provincial  Premiers  Write  of  1921  and  Outlook 

Past  Year  Has  Been  One  of  Difficulty,  With  Hope  of  Reviving  In- 
dustry— Developments  in  Agriculture,  Manufactures  and  Other  Phases 
of  Industry  in  the  Provinces  —  Provincial  and  Municipal  Finances 


wiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiHiiiiiiiiiiiiiiiim^ 


ONTARIO 


E.  C.  DRURY, 


Premier 


,  ^iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiwiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiHin^ 

ONTARIO  maintained  production  during  the  past 
year  with  characteristic  energy  and  enterprise. 
The  Agricultural  yield  was  impaired  in  some  re- 
spects by  exceptional  conditions,  but  this  was  In 
part  compensated  for  by  the  dSvarsity  of  our 
crops  and  the  resourcefulness  of  our  people.  The  marked 
decrease  in  prices  contributed  to  reduce  the  financial  returns 
of  the  farmers  and  thereby  restricted  their  purchasing 
power.  The  outlook,  however,  at  the  present  time  ^or 
agriculture  is  very  reassuring  as  we  have  had  an  open  Fall 
and  extensive  preparations  have  been  made  for  the  coming 
year.  The  lumbering  industry  experienced  the  effect  of  a 
curtailed  demand  for  its  product  so  that  the  large  operators 
are  now  planning  for  somewhat  less  than  the  normal  output 
this  winter  with  the  hope  that  circumstances  may  warrant 
their  augmenting  their  organization.  Market  conditions 
restricted  the  manufacture  of  pulp  and  paper,  but  the  fact 
that  the  pulp  resourses  of  the  Province  have  lately  attracted 
additional  investments  indicates  a  confidence  in  the  early 
revival  of  the  industry.  Substantial  progress  was  made  in 
gold  mining;  silver  production  was  equal  to  the  output  of 
1920.  The  demand  for  nickel  has  largely  disappeared  since 
the  conclusion  of  peace. 

In  view  of  the  industrial  situation  the  Provincial  Gov- 
ernment considered  it  advisable  to  maintain  and  extend  Its 
operations  whenever  possible.  Much  employment  was 
afforded  by  a  comprehensive  plan  of  road  building  and  by 
the  extensive  development  at  Chippawa.  Further  under- 
takings to  afford  employment  are  in  hand.  The  Govern- 
ment was  under  the  necessity  of  asking  for  funds  for  these 
and  other  purposes.  All  such  requests  met  with  a  ready 
response  and  the  revenues  of  the  Province  were  well  main- 
tained. On  the  whole,  Ontario  passed  through  a  dlBicult 
period  with  most  encouraging  results  and  unimpaired  pres- 
tige. Progress  was  made  in  the  settlement  of  the  North 
Country,  particularly  along  the  route  of  the  Transcontin- 
ental Railway,  and  the  settlers  taking  up  land  are  of  a  type 
well  adapted  to  pioneer  life.  The  people  of  this  province 
regard  the  future  with  confidence,  not  only  for  Ontario  but 
for  all  Canada. 


SASKATCHEWAN 


W.   M.   MARTIN 


Premier 


SASKATCHEWAN  shares  In  certain  conditions  at  present 
common  to  the  civilized  world,  but  notwithstanding  a 
crop  that  did  not  reach  the  high  expectations  once  enter- 
tained, and  the  serious  fall  in  the  prices  of  agricultural  pro- 
ducts the  prevailing  tone  is  one  of  optimistic  confidence  In 
the  future  of  the  Province.  I  am  sure  I  have  the  Province 
behind  me  when  I  express  the  opinion  that  there  are  few. 
if  any,  parts  of  the  world,  which  are  more  rapidly  reverting 
to  normal  business  stability  than  the  Province  of  Sas- 
katchewan; and  this  notwithstanding  that  high  costs  of 
labour  and  transportation  combined  with  falling  values  are 
putting  a  strain  on  the  farming  industry  which  it  would  be 
idle  to  ignore. 

I  should  like  to  make  a  passing  remark  on  the  matter 
of  certain  defaulting  municipalities.  These  defaults  are  not, 
if  I  may  use  the  term  normal  defaults.  They  are  the  results 
of  boom  times,  and  of  the  lack  of  due  care,  and  are  not  the 
legitimate  outcome  of  any  permanent  condition.  At  the 
time  these  bonds  were  issued  by  the  municipalities  the 
Saskatchewan  Government  had  no  control.  The  establish- 
ment of  a  Local  Government  Board  whose  sanction  is  now 
necessary,  will  make  this  defaulting  practically  an  impos- 
sibility in  the  future.  As  I  pointed  out  last  year  our  debt 
account  is  on  a  very  satisfactory  footing,  when  the  diff-r 
ence  is  considered  between  liabilities  which  represent  : 
ments,  and  those  which  are  a  dead-weight  on  the  re\  ■ 
Saskatchewan  has  its  share  of  unemployment,  but  owing  to 
our  high  percentage  of  rural  as  compared  with  urban  popu- 
lation it  is  probably  a  less  serious  problem  with  us  than 
with  any  other  part  of  Canada.  The  success  of  Saskatche- 
wan stock  and  grain  in  Jnterprovincial  and  international 
exhibitions  has  been  very  gratifying  'during  the  past  year. 
and  gives  another  proof,  were  it  needed,  that  Saskatchewan 
can  hold  its  own  anywhere  not  only  for  quantity  bat  for 
quality. 

It  only  remains  to  add  that  notwithstanding  the  tem- 
porary cloud  caused  by  the  shrinkage  of  valnes,  I  myself, 
and  the  people  of  Saskatchewan  generally  were  nerer  more 
confident  that  our  Province  is  on  a  sound  basis,  and  that 
a  great  future  is  in  store  for  It. 


26 


THE       MONETARY       TIMES 


Volume  68. 


•tfilllllllllllllillllllllilllilllllllllllllllillllllllllllllMllllllllllllllllilllllllll 


ALBER T  A 

G.  H.  GREENFIELD  Premier 


WITH  the  passing  of  the  year  1921,  Alberta  emerges  from 
the  most  trying  year  in  her  history.  In  common  wrth 
the  rest  of  the  world  we  have  felt  the  repression  and  unrest 
consequent  upon  the  necessary  re-adJustment  and  re-adapta- 
tion to  new  conditions  following  in  the  wake  of  the  Great 
War.  Unfavorable  climatic  conditions  during  the  summer 
turned  the  promises  of  an  exceptionally  fine  spring — which 
had  encouraged  the  seeding  of  a  larger  grain  acreage  than 
ever  before — into  a  partial  crop  failure  over  a  portion  of 
the  southern  part  of  the  province.  In  the  central  and 
northern  sections  of  Alberta  the  crops  turned  out  satisfac- 
torily. The  fall  season  was  favourable  to  harvesting,  thresh- 
ing and  shipping  operations.  Following  the  harvest  came 
a  serious  decline  in  grain  prices^  which  had  a  depressing 
effect  upon  the  farmer'  business  as  had  also  a  general 
decline  in  live  stock  prices.  In  spite  of  this  combination 
of  unfavorable  conditions,  Albertans  are  facing  the  new 
year  in  neither  a  depressed  nor  pessimistic  mood.  It  is  not 
characteristic  of  the  Albertan  to  be  pessimistic.  The  Prov- 
ince contains  so  much  in  the  way  of  natural  riches,  that  this, 
coupled  with  the  optimistic  and  recuperative  tendencies  of 
the  people  brings  me  to  say  that  the  outlook  for  1922  is 
both  hopeful  and  encouraging.  Alberta's  varied  resourses, 
her  widespread  activities  and  her  abounding  natural  wealth, 
give  her  people  a  buoyant  and  hopeful  spirit  that  is  re- 
doundant  even  under  what  might  be  thought  a  fair  measure 
of  adverse  conditions. 

The  recent  census  shows  that  we  have  86,000  farms  un- 
der cultivation  in  the  Province.  The  year  1921  has  turned 
the  thoughts  of  many  of  our  farmers  in  two  directions,  both 
of  which  will  place  their  mark  upon  the  future  of  Alberta. 
The  hope  of  the  southern  part  is  in  irrigation  and  conditions 
this  year  have  intensified  efforts  in  this  direction  in  a  man- 
ner which  must  ultimately  mean  great  things.  A  man  would 
be  indeed  a  prophet  who  could  completely  forecast  what 
irregulation  will  mean  to  Southern  Alberta.  Another  far- 
reaching  effect  of  1921  conditions  will  be  that  the  thoughts 
of  the  farmers  will  turn  more  towards  "mixed  fairming." 
Probably  the  most  concrete  way  of  showing  the  wisdom  of 
this  is  in  indisputable  figures  which  everyone  understands. 
Edmonton  is  the  centre  of  Alberta's  mixed  farming  opera- 
tions and  during  the  past  few  months,  when  bank  clearings 
have  been  declining^  Edmonton  has  kept  a  higher  point  on 
this  business  barometer  than  any  point  In  Canada. 

The  dairying  industry  continues  in  a  satisfactory  condi- 
tion with  figures  indicating  an  increase  over  1920.  Alberta 
dairy  products  have  earned,  and  hold,  a  high  place  both  at 
home  and  in  the  markets  outside  the  Province. 

The  coal  mining  industry  has  had  a  good  year.  As  the 
prairie  provinces  fill  up  with  people,  our  mining  industries 
must  become  of  greater  importance. 

In  an  industrial  way  Alberta  is  making  steady  progress. 
This  year's  discovery  of  iron  ore  deposits  in  the  northern 
part  of  the  province  has  a  meaning  which  presages  great 
industrial  development.  The  oil  drilling  operations  in  many 
widely  scattered  sections  of  Alberta  bring  hopes  of  tapping 
further  sources  of  natural  wealth.  The  timber  resources  of 
Alberta  should  lead  capital  into  the  establishing  of  the  pulp 
and  paper  industry  In  Alberta.   - 

The  Peace  River  country  has  had  a  very  good  harvest 
and  is  bearng  out  the  promises  of  the  past.  The  great 
Northland,  stretching  away  to  the  Artie  Ocean  has  in  1921 
come  into  prominence  through  discoveries  of  natural  wealth 
in  abundance.  1921  had  witnessed  a  wonderful  improve- 
ment in  transportation  facilities  into  the  North.  The 
Canadian  Pacific  Railway  operates  the  lines  into  the  Peace 
River  country.  The  Alberta  Government  has  much  improved 
the  A.&  G.W.  Railway  from  Edmonton  to  Fort  McMurray 


and  the  traveller  or  tourist  can  now  make  the  trip  into  the 
farthest  north  in  comfort  and  expeditiously,  by  railway  and 
steamboat  service,  through  a  land  which  a  few  years  ago 
was  tight-locked  against  any  but  the  most-  venturesome 
spirits. 

Perhaps  the  most  encouraging  feature  in  our  future 
outlook  is  to  be  found  in  the  increasing  attendance  of 
students  at  the  University  of  Alberta,  this  winter  some 
twelve  hundred  students  being  enrolled.  There  is  refresh- 
ing hope  for  the  future  of  the  basic  industry  of  this  province 
when  it  is  known  that  the  number  of  students  taking  the 
course  in  Agriculture  is  the  largest  in  the  history  of  the 
University. 

The  fact  that  Alberta  people  in  a  year  like  1921  have 
invested  considerable  sums  of  money  in  Alberta  Provincial 
^pnds  is  an  indication  of  the  faith  and  hope  which  is  in 
the  hearts  of  our  people. 

I  consider  that  in  Alberta  we  can  hold  no  gloomy  views 
of  future  outlook  but  rather  we  must  see  much  that  makes 
for  both  hopefulness  and  optimism.  Our  greatest  resourse 
remains  intact  in  the  manhood  and  womanhood  of  our 
country  and  in  the  industry  and  ambition  of  our  citizens. 


iiiiiiiiiiiiiiiiiiiiiiiiwiiiiniiiiiiiiiiiiiniiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii^^ 


PRINCE  EDWARD  I. 

JOHN  H.  BELL  Premier 


^illlillllllllllllllllllllllllllllilllllllllltllllllllllllilllllllllllllllllllllllllllllllllllillllllllllHIIIIIH^ 


PRINCE  EDWARD  ISLAND  has  had  a  good  average  year 
in  nearly  all  of  her  varied  productive  industries. 
Nearly  four-fifths  of  the  population  of  the  Island  are  depen- 
dant upon  agriculture  while  the  remaining  one-fifth  are 
occupied  in  the  various  callings  of  the  towns  and  villages, 
and  in  fishing  and  fox-breeding.  Upon  the  success  of  ag)ri- 
culture  therefore  the  prosperity  of  the  trading,  the  profes- 
sional and  other  classes  very  largely  depends.  Manufac- 
turing is  not  extensively  carried  on. 

During  and  since  the  war  down  to  the  close  of  1920  the 
farmers  had  been  generally  more  prosperous  than  at  any 
like  period  in  the  history  of  the  province.  War  prices  for 
all  they  could  produce  enabled  them  to  make  more  money, 
spend  more  money  and  at  the  same  time  to  save  or  invest 
more  money  than  during  any  previous  seven  years.  The 
Collapse  in  prices  combined  with  a  rather  dry  season 
greatly  reduced  the  aggregate  value  of  farm  production, 
which  owing  to  the  season  was  somewhat  less  in  quantity 
than  last  year.  The  principle  staple  field  crops  are  hay, 
oats  and  potatoes.  Good  harvest  weather  enabled  them 
all  to  be  saved  in  prime  condition.  Hay  still  commands 
war  prices,  while  the  price  of  oats  and  potatoes  has  been 
greatly  reduced.  Even  here  there  was  a  measure  of  com- 
pensation in  the  fact  that  seldom  if  ever  before  had  the 
potato  crop  proved  to  be  so  uniformly  sound. 

In  regard  to  fish  the  value  of  the  annual  catch  for  many 
years  past  has  ranged  from  about  a  million  to  a  million  and 
a  half  in  dollars,  with  little  marked  difference  in  quantity. 
Fish  went  up  in  price  as  meats  did  and  has  come  down  the 
same,  the  value  of  the  catch  this  year  being  much  less  than 
in  recent  years.  The  larger  moitey  of  the  value  produced 
in  recent  years.  The  larger  motely  of  the  value  produced 
200  canneries  are  engaged  for  several  months  in  the  spring 
and  summer  seasons. 

Farmers  and  merchants  alike  have  passed  the  transition 
of  the  past  two  years  by  regular  process  and  without  finan- 
cial shock.  There  have  been  no  business  failures.  The  var- 
ious branches  of  the  larger  banks  doing  business  in  the 
province  have  had  apparently  a  successful  year.  The  tact 
that  the  Provincial  Government  not  long  ago  adonteH  a  plan 
of  borrowing  money  direct  from  the  people,  is  affected  in 
some  measure  the  deposits  and  withdrawals  of  money  from 
the  savings  department  of  the  chartered  banks.  The  govern- 
ment pays  5  per  cent,  interest  on  such  deposits  and  gives  the 
depositor  the  privilege  of  withdrawing  the  same  in  whole 
or  in  part  at  any  time  without  previous  notice. 


January  6,  1922. 


THE      MONETARY      TIMES 


n 


In  commercial  circles  trade  has  been  quiet  during  the 
past  summer.  People  had  less  money  to  spend  and  held 
off  from  buying,  believing  that  prices  would  be  lower.  More 
recently  tlie  fall  trade  has  been  quite  brisk  and  a  good  holi- 
day business  seems  to  be  assured  as  to  quantity  of  merchan- 
dise, but  at  less  prices  and  also  less  profit  than  in  recent 
years. 

The  fire  insurance  companies  have  had  quiet  a  busy 
year  if  not  a  particularly  profitabie  one.  There  have  been 
no  big  conflagration  losses.  Perhaps  the  worst  fire  of  the 
year  was  that  which  recently  destroyed  the  Charlottetown 
Hospital  involving  insurance  losses  of  about  $30,000.  There 
have  been,  however,  an  increased  number  of  smaller  fi^e 
losses,  notably  of  automobiles  in  garage  fires  and  otherwise. 


There  have  also  been  many  cases  of  reduction  of  the  amount 
at  risk,  covering  Btorea  and  mercbandiae,  owing  to  dim* 
Inished  stocks.  Fire  insurance  was  never  more  appreciated 
than  it  is  today,  and  the  prompt  payment  of  losses  baa  estab- 
lished confidence  for  the  future. 

Generally  speaking  all  lines  of  industry,  production  and 
business  in  Prince  Edward  Island  are  on  a  sound  and  satis- 
factory basis.  The  people  are  as  a  rule  comfortably  well-off, 
comparing  favorably  in  that  regard  with  any  other  Canadian 
province.  There  is  very  little  of  actual  poverty  and  hardly 
more  of  unemployment  than  in  the  years  before  the  war. 
But  the  still  high  cost  of  living  makes  unemployment  a 
much  more  serious  affair  to  the  unemployed  now  than  in 
former  years. 


HOMESTEAD  ENTKIES   HAVE  BEEN  LOW 


BRITISH  COLUMBIA  MINEKAL  OUTPUT 


Decline  Since  1911  Has  Been  Continuous,  and  1921  Figure 
Is   Only    Ono-Tenth    «)f   I'lP-War   Fljoire 

HOMESTEAD  entries  during  the  fiscal  year  ended  March 
31,  1921,  in  the  four  western  provinces  of  Canada,  num- 
bered 5,389,  compared  with  6,732  during  the  preceding 
year.  A  recovery  is  being  shown  during  the  present  year, 
however,  the  total  tor  the  six  montlis  ended  October  3  being 
5,652,  which  approaches  the  pre-war  rate.  Total  home- 
stead entries  for  the  past  24  years  have  been  as  follows: 


1898 
1899 
1900 
1901 
1902 
1903 
1904 
1905 


.  4,848 
.  6,689 
.  7,426 
.  8,167 
.14,673 
.31,383 
.26,073 
.30,819 


1906 
1907 
1908 
1909 
1910 
1911 
1912 
1913 


.  .41,869 
...21,647 
...30,424 
,  .39,081 
.  .41,568 
.  .44,479 
..39,151 
.  .33,699 


1914 
1915 
1916 
1917 
1918 
1919 
1920 
1921 


..31,829 
.  .24,088 
.  .17.030 
.  .11,199 
..  8,319 
..  4,227 
..  6,732 
,  ..    3,784 


A  statement  showing  the  entries  by  provinces  and  by  the 
nationality  of  the  immigrants  is  given  herewith. 


An  estimate,  based  on  such  official  returns  as  were 
available  slightly  more  than  a  month  before  the  close  of 
the  year,  places  the  value  of  the  mineral  production  of  British 
Columbia  for  1921  at  $24,553,909.  The  1920  output  had  a 
monetary  value  of  ?35,543,084,  so  that  it  may  be  expected 
that  there  will  be  a  decrea.se  of  about  $10,989,175,  or  30^ 
per  cent. 

The  value  of  the  output  of  the  various  minerals  for  1920, 
together  with  the  estimated  value  for  1921,  is  given  below: 

1920  1921 

Gold    •$  2,702,992  $2,411,020 

Silver    .3.2;ir,,;i8o      i  ,.-.3.")365 

Copper     1.S-i2.H'.i'J       .•i.720,000 

Lead 2,816,115       1,754,400 

Zinc   3,077,979       1,723,500 

Coal   13,450,169  11,432,644 

Miscellaneous   mineral    _   250,490         200,(J00 

Building  material  *2,176,460      1,776,460 

Totals   $35,543,084  $24,653,909 


NATIONALITIES. 

Manitoba. 

Canadians  from  Ontario   76 

do.  do.    Quebec       36 

do.  do.    Nova    Scotia    7 

do.  do.    New   Brunswick   6 

do.  do.    I'rlnce  Edward  Island  3 

do.  do.    Miuiltoba     )SS 

do.  do.    Saskatchewan    1i 

do.  do.    Alberta     i 

do.  do.    British   Columbia   

Persons  who  had  previous  entry   97 

Newroundlanders       1 

Canadians  returned  from  the  United  States  

Americans     49 

English 131 

Scotch     13 

Irish      IS 

French      0 

Belgians     tl 

Swiss     1 

Italians     

Houmanlans     

Syrians     

Germans     I 

Auslio-llungarlans    3i 

Hollanders      I 

Panes  (other  than  Icelanders)  8 

Icelanders     13 

Swedes      6 

Norwegians      7 

nusslans  (other  than  Finns)   a 

I'Inns     8 

Serbians     

Bulgarians    

Chinese     

Japanese    

Persians     

Ausliallans     

New  Zealanders     

Hindoos        

Hebrews 

Greeks      i 

Polos      ' 

South  African  < 

Australian      

New  Zeal'ind     

Brazilian    

South  .\nierlcau    , ... 

Armenian   

Total    ^^■' 


FISC.U,   YEAR    1920-21. 
PHOVINCES. 
Saskatche 
wan, 


2S7 
83 
26 
7 
11 
61 
67 

.  10 

200 


292 
256 
80 
29 
11 
13 
3 


;t 

12 

1 

31 
40 


Alberta.  B. 

292 

150 

40 

38 

21 

44 

24 

120 

20 

511 

7 

3 

721 

398 

107 

60 

15 

11 

14 

14 

5 

1 

14 

84 

5 

2« 

40 
42 
38 


.  Columbia. 

10 

1 

5 
1 
2 
4 

2 
7 
13 


10 
33 
13 

7 


Total 

fiC5 

270 

78 

52 

37 

237 

105 

134 

27 

871 

8 

3 

1074 

S21 

242 

114 

32 

36 

18 

19 

12 

1 

£2 

170 

» 

4« 

14 

71 

84 

91 

8 


l|-Tl) 


110 


12 

1 

1 
I 
I 


S38S 


Maniloba. 
97 
4« 
12 

3 

It 

193 

8 

S 

0 
109 

2 

0 
96 
132 
37 
15 
13 
II 

0 

0 

« 

0 

« 

4 

4 
10 
21 
14 
25 
?1 


APRIL— OCTOBEn,    1921. 

PR(JVI.NCES. 
Saskalrhe- 


19 


11 1'.  J 


wan. 

273 

101 

28 

14 

1« 

89 

100 

12 

S 

S88 

0 

1 

432 

206 

68 

24 

20 

12 

2 

6 

27 

I 

10 

171 

3 

12 

5 

51 

57 

66 

7 


Alberts.  B.  Columbia. 


1 
22 


lOo 
95 
29 
22 
II 
33 
S9 

157 
» 

382 
> 
2 

581 

211 
73 
S3 

a 

3 
7 

10 
9 
1 

19 
117 

It 

18 
2 

r 

47 
38 
13 


11 
1 

'i 
1 

3 
1 
3 

1! 

13 
0 
0 

t> 

40 
9 
3 
0 
0 
0 
3 
1 
0 

13 

0 
0 
0 

9 
> 
> 
0 


Total 
587 

aa 

ST 

40 
37 
318 
138 
174 
40 

•at 

t 

3 
1131 
SM 
187 
74 
51 
18 
15 
19 

a 

t 

36 
S37 

ts 

n 

17 
119 
•SO 
III 

41 


3 

51 

4 


1 
MB* 


28 


THE      MONETARY      TIMES 


Volume  68 


Provincial  Legislation  for  the  Year  1921 

A  Brief  Summary  of  the  Principal  Changes  Made  by  the  Legis- 
latures, as  Affecting  Finance  and  Industry — Every  Province 
Had    a   Session    in    1921,    and    British   Columbia    Had    Two 


•y  AKING  their  cue  from  public  opinion,  and  following 
•■■  the  lead  of  the  Dominion,  the  provincial  gov- 
ernments passed  no  legislation  of  a  radical  char- 
acter in  1921.  In  the  first  place  the  volume 
of  legislation  was  not  great,  and  the  new  statutes 
are  extensions  of  measures  already  in  force,  or 
adoption  of  reforms  already  in  force  in  socne  other  province, 
rather  than  innovations.  The  effect  of  1921  legislation  in  the 
provinces  will  be  that  expenditures  will  be  increased,  and 
that  a  corresponding-  effort  was  made  to  raise  more  revenue 
IS  seen  from  the  increased  taxes  levied,  while  wealth  and 
business  are  called  upon  to  pay  bills,  however,  there  has 
been  m  evidence  a  tendency  to  facter  industry,  which  is  no 
doubt  due  to  the  difficulties  it  encountered- during  the  war. 
The  dates  of  the  latest  sessions  of  the  provincial  lee-is- 
latures  are  as  follows  : 

Opened  Closed 

British  Columbia  Februiry     8  April     2 

B.  C.    (2nd.  session)  October  18  December  3 

Alberta  February  15  April  19 

Saskatchewan  (1920)  November     4  December  15 

Manitoba  February  10  May     7 

Ontario  January  25  May     3 

Quebec  January  11  March  19 

Nova  Scotia  March     9  May  28 

New  Brunswick  March  17  A,pril  16 

Prince  Edward  Island  March  10  April  30 

Quebec  and  Ontario 

Quebec  furnished  the  most  outstandin.-j  piece  of  provinc- 
ial legislation  of  the  year,  in  two  bills,  one  revising 
Montreal's  form  of  *  government  and  the  other  creating  a 
Metropolitan  Commission  with  limited  jurisdiction  over  the 
city  and  adjoining  municipalities.  All  borrowings  must  be 
approved  by  this  commiiasion,  and  Montreal  North,  St.  Michel 
de  Laval  and  Pointe  aux  Trembles,  which  have  been  In 
financial  difficulty,  must  submit  their  annual  budgets  to  it. 
Next  to  these  comes  the  acquisition  by  the  government  of  the 
liquor  business,  whereby  distilled  liquors  can  be  sold  only  by 
the  government.  Further  improvements  in  finances  is  the 
object  of  a  measure  prohibiting  municipalities  from  granting 
assistance  in  any  way  to  industries;  there  are  also  measures 
for  the  submission  of  all  loan  by-laws  to  the  ratepayers  and 
for  the  depositing  of  sinking  funds  with  the  provincial 
treasurer.  An  item  of  labour  legislation  is  the  prohibitors  of 
strikes  on  the  part  of  policemen,  firemen  and  other  municipal 
employees.  

Ontario  passed  statutes  numbering  140,  and  the  work  of 
the  session  was  comprehensive  touching  many  fields  and 
being  supplemented  by  special  committees  on  rural  credits, 
timber  dues,  hydro-electric  radials,  university  finances  and 
other  matters.  In  the  financial  field,  the  corporations  tax. 
mining  tax  and  successions  duties  were  increased,  loan  and 
trust  companies  had  their  deposit  powers  enlarged,  and 
several  insurance  amendments  were  passed,  the  most  import- 
ant being  for  the  purpose  of  bringing  all  fraternal  societies 
to  a  condition  of  solvency.  There  was  also  imposed  a  tax  on 
land  transfers.  The  Co-operative  Credit  Societies  Act 
provides  for  the  organization  of  these  societies  in  any  dist- 
rict, to  be  administered  by  local  boards;  at  least  10  per  cent. 
of  net  profits  are  to  be  set  aside  to  establish  a  guarantee 
fund.  Municipal  amendments  of  the  session  were  also 
numerous,  several  changes  being  made,  in  the  law  relating  to 
assessment  'of  property  and  income. 

The  Maritime  Provinces 

The  chief  item  of  the  Prince  Edward  Island  legislature's 
business  was  the  incorporation  cf  the  Prince  Edward  Island 
TArht,  Heat  and  Pov/er  Company,  with  $2,000,000  capital. 
This  company  is  backed  by  outside  (apital  and  plans  to 
generate  and  distribute  power  throughout  the  province. 
There  was  also  an  amendment   to  the  charter   of  the  Island 


Telephone  Company,  and  some  minpr  changes  were  made 
affecting  the  finances  of  the  province,  one  making  it  legal  to 
pay  6  per  cent,  for  money  borrowed. 

New  Brunswick 

In  New  Brunswick  financial  difficulties  arising  from  the 
operation  of  the  Valley  Railroad  occupied  the  most  attention 
This  road  cost  the  province  |6,608,068,  and  at  present  fails 
to  meet  interest  cherges  by  about  $250,000,  so  that  the 
burden  on  the  province  is  heavy.  A  resolution  was  passed 
urging  the  Dominion  government  to  take  it  over.  Another 
project  affecting  the  industry  of  the  province  closely  is  the 
Grand  Falls  Company,  Limited,  a  subsidiary  of  the  Inter- 
national Paper  Company,  which  at  this  session  obtained  a 
two  year  extension  of  time  for  developing  power  on  the  St 
John  River.  Its  rates  will  be  controlled  by  the  Public  Utilities 
Commission  of  the  province.  Development  of  the  shale, 
natural  gas  and  -oil  deposits  in  Alberta  and  Westmoreland 
counties  were  also  discussed  at  length  in  connection  with  a 
bill  to  incorporate  the  Albertite  and  Oil  Shale  Company  of 
Canada,  Limited.  All  public  utility  companies  must  in  future 
report  annually  to  the  Board,  according  to  another  act. 
Telegraph  companies  were  also  included  under  the  Corpor- 
ations tax,  being  charged  1  per  cent,  of  gross  receipts.  In  all 
98  acts  were  passed  in  New  Brunswick,  out  of  a  total  of  102 
introduced  by  the  government. 

Nova  Scotia 
Nova  Scotia  passed  199  bills,  during  the  twelve  weeks 
that  Its  legislature  was  in  session.  The  government,  however, 
did  not  take  action  on  the  resolution  passed  by  the  House  of 
Assembly,  to  the  effect  that  sessional  indemnities  should  be 
increased  from  $700  to  $1,500.  The  outstanding  event  was 
the  act  providing  for  the  purchase  of  the  Dominion  Steel 
and  Nova  Scotia  Steel  companies  by  the  British  Empire 
bteel  Corporation.  After  recitals  of  the  fact  that  under  the 
Act  passed  last  year  the  Dominion  Steel  Corporation  and 
the  Nova  Scotia  Steel  and  Coal  Company  entered  into 
agreements  with  the  British  Empire  Steel  Corporation  for 
the  acquisition  of  their  shares,  which  agreements  are  append- 
ed as  schedules  to  the  Act,  and  that  these  agreements  were 
approved  by  the  shareholders  and  that  the  British  Empire 
Corporation  has  deposited  the  shares  of  its  stock  necessary 
to  carry  out  the  agreements  vrith  the  depositaries,  the 
National  Trust  Company  and  the  Eastern  Trust  Company, 
the  Act  declares  : 

1.  That  the  agreements  are  valid  and  binding  upon  the 
companies  and  upon  the  holders  of  all  their  common  shares. 

2.  That  all  the  outstanding  common  shares  of  the 
Dominion  Corporation  and  the  Nova  Scotia  Company  became 
vested  in  the  British  Empire  Corporation  on  16th  April, 
1912,  the  date  when  its  shares  were  deposited. 

It  provides  also  that  the  directors  may  make  regulations 
for  the  payment  of  dividends  in  the  currency  of  a  foreign 
country,  but  only  in  amounts  equivalent  to  the  dividends  in 
Canadian  currency  based  on  the  rr.te  of  exchange  when  the 
dividends  are  declared. 

Finally  it  provides  that  the  shares  of  constituent  com- 
panies acquired  in  exchange  'for  its  own  shares  shall  not  be 
transferred  to  any  person  or  corporation  without  consent  of 
the  Govemor-in-Council.  This  provision  is  the  exact  parallel 
of  agreements  usually  made  with  Stock  Exchanges  when  the 
shares  of  a  holding  company  are  listed. 

Nothing  in  the  Act  afl'ects  the  exchange  of  preference 
or  preferred  shares  of  the  companies  which  remains  entirely 
et  the  option  cf  its  holders. 

The  Western  Provinces 

Municipal  finances,  and  a  division  of  taxes  between  the 
province  and  its  municipalities,  have  for  some  time  been 
unsettled   in  British    Columbia.      These  questions   were  dis- 


January  6,   1922. 


THE      MONETARY      TIMES 


t» 


cussed  to  some  extent  at  the  1921  session,  but  at  the  close 
Premier  Oliver  announced  that  the  next  session,  to  be  held 
in  the  winter,  would  devote  special  attention  to  them.  A 
total  of  70  bills  were  passe<i,  however,  out  of  8.5  introduced. 
The  g^)vernmcnt  was  authorized  to  borrow  $4,000,000,  at  6 
per  cent,  for  the  completion  of  tlie  Pacific  Great  Eastern 
Railway,  and  the  rate  of  interest  authorized  by  loan  acts  of 
1916,  1917  and  1919  was  roised  to  6  per  cent,  advances  and 
mnuicipalities  to  relieve  unemployment  were  approved  by 
the  house  and  several  statutes  were  passed  relt-tinp:  to  the 
financies  of  individual  municipalities.  A  new  companie'a 
Act  and  a  consolidation  of  the  provincial  trust  company  law 
were  alpo  passed.  Prohibition  was  replaced  by  a  system  of 
government  sale,  and  an  arrangement  was  made  with  Coast 
Itange  Steel  Ltd.,  whereby  the  government  Is  to  give  It  a 
bonus  not  exceeding  $3  per  ton  of  pig  iron  produced. 

The  Alberta  Legislature  passed  about  95  bills.  Those 
of  most  importance  to  business  and  finance  were  amend- 
ments to  the  liquor  act,  to  the  Water  Users'  District  Act, 
to  the  Agricultural  Societies  Ordinance,  to  the  Alberta  Insur- 
ance Act,  to  the  Savings  Certificate  Act,  to  the  Irrigation 
and  Drainage  Districts  Acts,  to  the  Supplementary  Revenue 
Act,  and  to  the  Wild  Lands  Tax  Act.  Acts  were  alsr.  passed 
to  tax  travelling  shows,  to  tax  land  for  educational  par- 
poses,  and  to  provide  for  the  maintenance  of  the  Edmonton, 
Dunvegan  and  British  Columbia  Railway  Go. 

The  first  of  the  legislatures  to  meet  was  Saskatchewan, 
which  placed  very  little  new  legislation  of  a  public  character 


on  the  statute  boolcH.     ■,,.i,,^r,  k.i  ^•■,a  incremaed, 

the  maximum  payment  under  the    ■■  ■  .'•  CompenMtioii 

Act  was  raised  frooi  $1,800  to  I'^.hud,  ine  Munciipal  Mail 
Insurance  Act  amended,  anA  some  changes  made  in  the  seed 
grain  laws.  The  total  borrowings  authorized  under  the 
Saskatchewan  farm  loans  system  waH  increased  from  $10,- 
000,000  to  ♦l.'),0U0,0OO,  and  the  toul  under  the  AKricuUurat 
Aid  Act  from  $1,000,000  to  «2,000.0<W.  Provincial  Uses  on 
travelling  shows  were  increased,  other  Act*  dealt  with  the 
Wild  Lands  Tax  and  local  asseasmenta,  while  the  new  leps- 
l;;t  on  was  not  heavy,  the  legrislature  paaeed  three  reaoln- 
tions  of  importance,  the  first  asked  that  the  federal  wheat 
Board  again  rrarket  the  wheat  crop,  the  second  urged  that 
branch  lines  of  the  Canadian  National  Railways  under  con- 
struction in  the  province  be  completed,  while  the  third  aaked 
lor  tariff  reform,  including  "  An  immediate  and  substantial 
all  round   reduction  of  the  customs  tariff." 

Manitoba  gave  attention  to  municipal  and  hoapital 
financing,  one  act  empowering  Winnipeg  to  collect  and 
income  tax,  while  others  validated  certain  bond  issue*.  The 
legislature  decided  to  abolish  the  of!k:e  of  public  utilities 
commissioner,  and  transfer  the  work  to  the  provincial  secre- 
tary's department,  the  government  being  given  one  year  in 
which  to  prepare  this  change  instatutary  form.  A  provincial 
income  tax  bill  waa  withdrawn,  after  much  debate.  The  net 
profits  of  corporation,s  were  taxed  by  2  rM-mnt ,  :ind  several 
other  taxes  increased. 


Readjustment  in  the  Steel  Industry 

World's  Demand  in  1921  Shaded  Down  Greatly,  With  Consequent  Effect 
Upon  Production — Prices  and  Wages  Dropped — British  Empire  Steel 
Corporation  Formed — Authorities  Point  to  Good  Future  of  the  Trade 


NINETEEN-TWENTY-ONE  was  distinctly  a  year  of  re- 
,  action  in  the  iron  and  '  steel  industry,  which,  of 
course,  in  turn  affected  the  production  of  coal.  That  Is 
a  general  statement  of  the  situation  as  it  existed  in  Can- 
ada, but  at  the  same  time  it  includes  all  iron  and  steel 
producing  nations  of  the  world,  for  business  depression 
was  universal,  and  iron  and  steel,  as  a  basic  industry, 
was  greatly  affected. 

In  the  previous  year  demand  and  prices  had  maintained 
a  steady  upwar  dtrend.  In  fact,  in  the  earlier  parts  of  1920 
there  had  been  an  insatiable  demand,  of  world-wide  nature, 
which,  according  to  an  authority  in  the  industry,  taxed  the 
producing  capacity  of  this  continent.  But  when  November  of 
that  year  had  passed,  a  great  change  was  noticeable. 
Factories  and  plants  were  partially  closed  through  lack  of 
orders,  the  only  work  being  that  v/hich  was  placed  when  the 
outlook  was  not  obscured  by  a  too  uncertain  future  and  when 
the  warning  of  economists  still  went  unheeded,  and  a  few 
odd  orders. 

As  this  old  work  began  to  reach  completion,  and  the 
small  new  orders  were  executed,  the  outlook  became  more 
clouded,  and  new  phases  began  to  enter  into  the  situation  be- 
sides inactivity.  So  that  the  earrly  months  of  1921  found  the 
iron  and  steel  trade  undergoing  a  great  change,  with  prices 
falling  steadily  and  the  cost  of  labor  and  operations  following 
a  similar  course,  which  conditions,  practically  speaking,  con- 
tinued throughout  the  entire  twelve  months. 

There  was  a  great  need  for  steel,  but  in  view  of  the 
conditions  the  prospective  buyers  naturally  went  on  strike, 
except  in  most  urgent  cases,  and  it  seemc<l  that  the  lower  the 
prices  went,  the  more  buyers  withdrew  from  the  market  in 
anticipation  of  much  lower  levels. 

Looking  Abroad 

When  the  first  sisrns  of  depression  came  upon  the  hori- 
zon, Canadian  manufactures  liftod  up  their  eyes  to  see  if 
there  was  any  cl.ance  of  recoup.'ng  themselves  by  placing 
more  orders  abroad,  but  investigation  showed  that  conditions 
in  Great  Britain  and  the  United  States,  particularly,  were 
as  bad  as  here,  if  not  worse. 


In  England,  shipov  ners,  shipbuilders,  and  steel  and  iron 
makers  were  regarding  the  future  with  considerable  misi^v- 
ing,  and  their  fears  were  not  imaginary,  as  sabaequent 
events  showed.  Shipowners,  alarmed  Et  the  steady  decline  in 
freights  ,caused  a  kind  of  crmisticc,  in  which  the  shipbuilder 
was  appealed  to  for  suspension  of  manufacture  upon  those 
ships  which  were  in  the  state  of  semi-c'"'"'' '^i^"  t^*-  'hip- 
owner   contending   that  it  was  simply  to 

construct  vessels  costing  over  three  times  i , due 

with  freights  approximating  to  those  in  1914. 

As  a  result  of  those  very  considerable  suspensions,  the 
shipbuilder  had  to  approach  in  like  manner  the  steel  maker, 
the    effect   of   which    upon  production    and  r--  -  readily 

apparent.     This  is  iust  one  phase  of  the  wh  i>n,  but 

it  is  sufficient  to  show  just  what  was  taking  (M.m-.  niid  what 
steel  manufacturers  had  to  contend  with. 

The  situation  in  the  United  States  was  much  the  same, 
and  a  good  many  of  the  companies  were  forced  to  cut  their 
dividends  in  the  second  quarter,  when  the  chance  for  profits 
in  the  third  and  fourth  quarters  did  not  look  any  too  good. 
The  ynited  States  Steel  Corporation,  although  sufTerinir  pro- 
portionately to  the  same  degree  ns  the  other  companies,  did 
not  cut  its  di\'idend  when  others  were  obliged  to  take  that 
action. 

Exports  and  Imports. 

While  there  are  no  official  figures  of  production  as  a 
whole  la.'t  vrar,  there  are  some  statistics  which  will  help  us 
to  reach  a  fairly  good  conclusion  .is  to  ho-.v  conditions  really 
were.  The  following  shows  the  tre  rts  and  imports 

during  a  period  of  twelve  months  f:  ■■i>er.  1920  : — 

Exports  imports 

1920  Dutiable  Free 

October    .  :  '  t         $3,981,764         $18.Tre^l8 

November  ...^'.    12  4.011,236  16,597J89 

December  8.627.564  S.214.544  15,419.206 

1921 
January   .  4.6.15..564  2.01.=>,129  10.868,783 

February  3..<;2;.966  2.17,''..,'^S9  ll.ClOjBOS 


36 


THE       MONETARY       TIMES 


Volume  68. 


30 

18% 

75 

61% 

23 

24% 

43 

62% 

9 

8% 

March 4,021,568  1,885,519  13,625,618 

April 2,537,552  1,390,677  10,099,356 

May    3,030,082  1,078,655  10,244,014 

June    1,786,291  818,722  9,043,479 

July     1,687,934  1,049,644  8,492,672 

August   1,631,933  1,190,092  8,531,831 

September   1,199,105  1,026,126  7,099,765 

Exports  for  the  twelve  months  ending  September,  1921, 
amounted  to  $35,392,217,  as  compared  with  $62,009,007  in  the 
previous  year,  and  $67,030,146  in  1919.  From  the  above 
figures  it  is  evident  that  Canada  is  still  an  importing  country 
in  iron  and  steel. 

Keflection  of  Security  Prices. 

The  security  markets  enable  us  to  take  a  glimpse  at  the 
way  individual  companies  were  affected,  which  would  not  be 
possible  otherwise.  The  trend  of  stocks  on  the  exchanges 
throughout  the  year  is  shown  in  the  following  brief  figures  : 

First  six  months  Close 

High         Low  Oct. 

Canada  Car  and  Foundry 43 

Dominion  Iron,   pfd 82 

Dominion  Steel     49 

Seetl  Company  of  Canada    64 

British  Empire  Steel  Corp 9% 

In  connection  with  the  above,  it  must  be  remembered 
that  in  the  case  of  the  British  Empire  Steel  and  the  Domin- 
ion Steel,  for  several  months  there  was  some  uncertainty  as 
to  value  of  stocks  because  of  the  exchanging  process  which 
was  taking  place.    This  would  adversely  affect  prices. 

A  peculiar  situation  at  the  beginning  of  the  year  in  the 
case  of  nearly  every  company  manufacturing  steel  or  steel 
products  here  and  abroad,  was  the  opposition  at  first  given 
by  labor  to  wage  cuts.  After  some  little  strife,  common  sense 
prevailed,  and  men  saw  that  such  a  movement  was  inevitable. 
The  total  reduction  made  by  the  British  Empire  Steel  Cor- 
poration during  the  year  was  forty  per  cent. 

Larger  reductions  were  made  in  the  United  States.  For 
instance,  the  Steel  Corporation  reduced  wages  during  the 
year  by  forty-five  per  cent.  Since  January,  1904,  up  to  May, 
1921,  any  change  in  wages  had  been  upward.  The  peak  of 
wages  was  reached  in  February,  1920,  when  they  were 
increa^'ed  to  $5.06  for  common  labor.  The  latest  reduction 
brought  this  scale  down  to  $3.00  per  day.  This  variation  of 
wages  followed  closely  on  the  changes  in  prices  of  steel,  etc. 
The  averaee  price  per  ton  of  eight  principal  steel  products 
immediately  before  the  war  was  $38.03.  During  the  war  the 
average  for  the  same  commodities  arose  to  $85,  and  since 
then  has  decended  to  $49.60  per  ton,  and  slightly  less. 
The  Demand  of  Railways. 

The  Canadan  railways  helped  business  somewhat  by 
placing  small  orders  for  rails,  in  which  the  British  Empire 
Steel  Corporation  and  the  Algoma  Steel  Corporation  partici- 

Pig  Iron,  Basic   

do        Foundry    

Mild  Steel   Billets,   4x4   and  larger    

do  under   4x4    , 

Open   Hearth   Steel   Ingots    

do  Steel    Blooms    

do  Steel    Ralls    

do  Mild  Steel  Bars*    

*Per  100  lbs.;  All  others  per  gross  ton. 


MANITOBA  BEE   COLONIES  WORKINa 


Honey  produced  in  Manitoba  bee  colonies  in  1921  ap- 
proximates 1,000,000  pounds,  according  to  a  report  placed 
before  J.  H.  Evans,  deputy  minister  of  agriculture.  Mr. 
Evans  said  the  number  of  hives  in  the  province  had  doubled 
since  the  spring  of  the  year  and  beekeepers  have  had  an  ex- 
ceptionally successful  season. 

Manitoba  now  has  14,721  colonies  of  bees.    Last  spring 


pated.  But  the  work  secured  from  this  source  was  not  as 
great  as  'expected.  However,  the  steel  companies  are  still 
living  in  anticipation  of  big  business  in  the  future. 

At  the  beginning  of  1921,  a  steel  expert  made  the  predic- 
tion that  following  the  stabilization  of  wages  and  prices, 
orders  will  be  issued  in  Canada  that  will  tax  the  Dominion 
iron  and  steel  plants  to  capacity.  His  reasoning  was  not 
based  on  mere  supposition,  but  on  a  good  foundation,  and  iii 
substance  it  is  this  : 

Virtually  no  rails  have  been  manufactured  in  Canada 
for  six  years.  The  railway  mileage  in  the  Dominion  is  not 
far  short  of  40,000  miles.  As  the  life  of  a  rail  is  about  ten 
years,  on  a  reasonable  estimate  there  should  be  a  replace- 
ment of  one-tenth  of  the  total  mileage  per  annum.  This 
means  that  in  normal  times  to  supply  wastage  400,000  tons 
of  rails  should  be  furnished  each  year.  At  the  present  time 
there  is  an  arrearage  of  more  than  two  million  tons  to  over- 
take, in  addition  to  400,000  tons  per  year,  ordinary  wear 
and  tear. 

British    Empire   Steel. 

Foremost  among  the  several  noteworthy  features  of  the  year, 
was  the  forrhation  of  the  British  Empire  Steel  Corporation. 
From  an  amalgamation  of  nine  or  ten  enterprises,  the 
merger  dropped  to  three,  two  of  which  were  the  original 
basis  for  amalgamation  for  years  past.  The  corporation  now 
embraces  the  Dominion  Steel  Corporation,  and  subsidiaries  ; 
Nova  Scotia  Steel  and  Coal  Company,  and  subsidiaries  ;  the 
Halifax  Shipyards,  Limited.  The  original  proposals  were  the 
cause  of  a  good  deal  of  strife  and  of  the  resignation  of 
several  notable  directors  from  the  boards  of  the  larger 
concerns.  But  the  new  arrangements  met  with  general 
approval,  and  shareholders  passed  upon  the  plans  with  little 
if  any  comment. 

The  magnitude  of  the  new  enterprise  is  hard  to  conceive, 
even  though  it  is  only  about  one  third  of  what  was  at  first 
anticipated.  The  British  Empire  Steel  Corporation  owns  coal, 
iron  ore  and  limestone  deposits,  lumber  properties,  water 
powers,  marine  properties,  including  loading  and  discharging 
plants,  dry-docking,  shipbuilding  and  ship-repairing  estab- 
lishments, and  steel  plants  and  car  works.  In  short,  it  ovms 
and  operates  its  own  supplies  of  raw  material,  its  own 
complete  series  of  plants  for  working  these  up  at  eyery 
stage,  and  its  own  tidewater  properties  and  steamship  lines 
transport  to  all  parts  of  the  world,  and  expressed  in  dollars 
and  cents,  these  are  worth  $169,000,000,  according  to  the 
figure  of  the  combined  assets  submitted  at  the  time  of  the 
merger. 

Price  Movement  in  1921 

The  Algoma  Steel  Corp.,  Sault  Ste.  Marie,  supplies  the 
following  figures  of  prices  for  1921,  which  are  typical  of 
the  trend  of  the  Iron  and  steel  market  as  a  whole.  They 
are  all  F.O.B.,  on  the  company's  plant,  and  all  standard 
specifications  : 


Jan. 

Apr. 

July 

Oct. 

Nov. 

45.00 

32.00 

25.00 

25.00 

24.00 

42.50 

35.00 

31.00 

31.00 

31.00 

45.00 

35.00' 

26.00 

26.00 

25.00 

55.00 

45.00 

40.00 

40.00 

37.00 

58.00 

48.00 

43.00 

43.00 

40.00 

50.00 

40.00 

36.00 

36.00 

35.00 

75.00 

60.00 

60.00 

60.00 

55.00 

3.50 

3.00 

2.50 

2.50 

2.25 

the  number  was  7,593.  An  average  of  118  pounds  of  honey 
was  produced  in  each  hive,  bringing  the  production  up  to 
903,000  pounds. 

Mr  Evans  compared  th^  production  in  Manitoba  with 
that  of  British  Columbia.  That  provinces  produced  an  aver- 
age of  30  pounds  per  hive  and  309,074  pounds  from  10,329 
colonies.  The  deputy  minister  pointed  out  this  is  the  first 
year  Manitoba  has  been  engaged  in  bee-keeping  to  any  great 
extent  and  he  was  well  pleased  with  the  results. 


'/ 


BANKING 


.laiUK\rv    C, 


li>22. 


•|'    11    K 


V    1    M 


T  H  E 


M  O  N   K  T  A   K   Y       T   1   -M    10  S 


Volume  (is. 


BANK   OF  MONTREAL 


Established  over   1 00  years 


■'  ""     -    ■■-■•^^.^^f>u.•.t^:,fli-■1SSjfty;•• 


Head  Office :  MONTREAL 


Capital  Paid  Up  -  $22,000,000 

Rest 22,000,000 

Undivided  Profits  1,501,646 

Total  Assets     -     -    517,403,162 


Board   of   Directors : 

SIR  VINCENT  MEREDITH,  Bart. 
SIR  CHARLES  GORDON,  G.B.E 


R.   B.   Angu.s,   POsq. 
Koiil  Shaughnessy, 
K.C.V.O. 

C.  R.  Hosnier,  E.sq. 

H.    R.   Druniniond,   Esq. 

D.  Forbes  Angus,  Esq. 
Wm.  McMaster,  Esq. 
Lt.-Col.  Molson,  C.M.G., 

M.C. 
Harold    Kennedy,   Esq. 


President 
Vice-President 

H.  W.   Beauclerk,  Esq. 

G.   B.  Eraser.   Esq. 

His   Honour  Henry  Cock 

s?hutt,    Esq. 
J.  H.  Ashdown,  Esq. 
E.  W.  Beatty,  Esq.,  K.C. 
Sir   Lonier  Gouin, 

K.C.M.G. 
Gen.  Sir  Arthur  Currie, 

G.C.M.G.,   K.C.B. 


SIR    FREDERICK    WILLIAMS-TAYLOR, 
(Irnrrnl  Manager 

A  Complete  Banking  Service 

With  branches  in  every  part  of  the  Do- 
minion and  Newfoundland,  with  offices  in 
the  principal  financial  centres  elsewhere, 
and  with  correspondents  in  all  parts  of 
the  world,  the  Bank  of  Montreal  offers 
unexcelled  facilities  for  the  transaction 
of  every  class  of  domestic  and  foreign 
banking. 

Direct  wire  service  between  ilontreal.  Quebec.  Toronto, 

Winnipe;/,  Tnncouver,  New  York,  Chicago  ami  San 

Francisco. 


A  Savings  Department  at  each  Canadian  Branch 
Interest  at  current  rates 


PRINCIPAL    BRANCHES    OUTSIDE    OF    CANADA: 


LONDON,  Eng.: 

47    Threadneedle   St.,    E.G.,    2. 

G.  C.  Cassels,  Manager. 

Sub  Agency  —  !)    Waterloo 

Place,  Pall   Mall.   S.  W.,   1. 
PARIS,  France: 

Bank    of    Montreal    (France), 

Place  Vendome. 


NEW  YORK  AGENCY:  04  Wall  St. 
R.  Y.  Hebden,  W.  T.  Oliver, 
S.  C.  No  rs  worthy,  E.  P. 
Hungerford,   Agents. 

CHICAGO;  27-l'0  South  La  Salle  St. 
SPOKANE,  Washington. 

SAN  FRANCISCO:  British  Ameri- 
can Bank  (owned  and  con- 
trolled by  the  Bank  of  Mont- 
real). 


MEXICO-     City  of  Me.xico. 

NEWFOUNDLAND:  St.  John's, 
Carbonear,  Curling.  Ferryland 
GauUois,  Grand  Falls,  Greens- 
pond  and  St.  George  s. 

WEST  INDIES,  BRITISH  GUIANA 
and  WEST  AFRICA;  The 
Colonial  Bank  (in  which  an 
interest  is  owned  by  the  Bank 
of  MontreaH. 


January  6,   1922. 


THE      MONETARY      TIMES 


ts 


Review  "of  Canadian  Banking  in  1921 

Decline  in  Deposits,  Loans  and  Other  Accounts  is  Incidental 
to  Course  of  Prices  and  the  Condition  of  Business — The 
Rural   Credits   Movement — The   Foreign   Exchange   Situation 

nv  A.  B.  BAKKER. 


AT  the  meeting  of  the  shareholders  of  the  different 
banks  in  the  early  part  of  last  year  a  slowing  up  of  busi- 
ness was  referred  to,  and  a  necessary  contraction  of 
credit  was  foreshadowed  by  the  executive  heads  of  these  Insti- 
tutions. This  feeling  was  not  confined  to  Canada  but  was 
general  throughout  the  bu.siiiess  world  everywhere.  The 
Chairman  of  the  English  banks  siioke  of  similar  conditions 
there.  Mr.  Leaf,  Chairman  of  London  Counties  Westmin- 
ster &  Parr's  Bank  Limited,  in  his  speech,  laid  stress  on 
the  essential  function  of  a  bank.      He  said: 

"The  part  which  banks  play  in  -industry  is,  I  believe, 
much  exaggerated  in  popular  opinion.  It  must  always  be 
remembered  that  banksrs  do  not  create  wealth — it  is  only 
within  very  narrow  limits  that  they  can  create  credit. 
Credit  is  based  on  production  and  savings  which  increase 
bank  deposits;  the  function  of  banks  is  mainly  directive. 
They  can  influence  in  one  direction  or  another  the  employ- 
ment of  funds  which  their  customers  place  with  them, 
but  in  the  amount  of  credit  which  they  can  dispose  of  they 
are  neither  creators  nor  free  agents;  they  are  strictly 
llmMed  by   their   own   resources." 

His  remarks  apply  very  Corcibly  in  Canada  where 
many  appear  to  have  quite  other  Ideas  of  bank  credit. 

Invasion  of  Banking  Field 

One  notable  feature  in  the  banking  situation  here  has 
been  the  entry  of  the  Ontario  Government  into  the  bank- 
ing field  following  Manitoba's  action  tre  previous  year. 
The  motive  in  each  case  is  to  provide  additional  accommo- 
dation to  farmers,  both  In  connection  with  funds  for  the 
purchase  of  land  and  machinery,  and  tor  the  actual  oper- 
ation. With  the  object  there  is  of  course  no  quarrel. 
Farming  is  one  of  the  basic  Industries  and  unless  the 
farmers  of  the  country  prosper  the  outlook  will  be 
unpleasant  for  the  rest  of  the  community.  As  to  whether 
the  methods  chosen  will  be  successful  or  not  only  time 
can  tell,  and  there  is  considerable  doubt  as  to  whether 
sufficient  margin  has  been  elft  for  expenses  and  for 
unforeseen  contingencies.  In  fhe  plan  as  outlined  these 
have  no  doubt  been  allowed  for,  and  If  everything  worked 
out  In  practice  as  it  does  on  the  blackboard  It  would  be 
very  pleasant,  but  unfortunately  there  are  always  delays, 
and  sometimes   these  are  at  critical   times. 

However,  the  experiment  was  bound  to  come,  and  its 
results  will  be  watched  with  considerable  Interest.  There 
will  be  little  difficulty  about  getting  out  the  loans,  and 
at  first  deposits  will  undoubtedly  comein,  but  the  test 
will  be  how  the  advances  are  paid,  and  when,  as  must 
Inevit.ibly  happen,  some  of  these  ar  erenewed,  how  the 
withdrawals  of  depositors  for  various  requirements  will 
be  arranged  for.  Will  the  Department  attempt  to  hold 
adequate  reserves  to  take  care  of  the  usual  day  to  day 
business  of  this  kind,  or  will  it  expect  to  rely  on  the 
banks  in  the  event  of  unlooked  for  withdrawals  at  any 
time,  borrowing  at  current  rates  for  the  purpose?  The 
Dominion  Government  Savings  Bank  and  the  Chartered 
Banks  pay  the  same  rate  of  interest,  but  for  some  years 
now   the   deposits   in   the   former  have  steadily   decreased. 

Banks'  Services  to  Their  Depositors 

The  real  reason  is  in  the  superior  service  given  by 
the  banks  to  their  depositors.  A  man  has  JlOO  in  the 
Government  Savings  and  decides  to  use  it.  First  he 
goes  to  the  local  post  office,  fills  out  the  necessary  blank, 
signs  it,  and  hands  in  hia  pass  book,  the  official  noting 
the  amount  requisitioned  and  stamping  it  wth  tihe  P.  O. 
stamp.  Ths  form  is  then  sent  to  Ottawa,  where  the 
regular  cheque  is  made  out  and  sent  to  the  depositor  by 


mall.  This  means  a  hecond  call  at  the  post  offlce,  and 
then  he  has  to  find  some  one  to  cash  the  cheque.  If  the 
postmaster  has  the  funds  at  hand,  well  and  good,  bttt 
otherwise  the  depositor  may  have  to  travel  to  the  nearest 
branch  bank.  It  is  this  necessa'ry  delay  more  than  any- 
thing else  which  is  responsible  for  the  shrinkage  of  these 
deposits.  When  a  man  has  funds  In  a  branch  bank  and 
decides  to  use  part  of  his  bal:ince,  one  trip  Is  suffldeat; 
there  is  no  delay;  he  draws  his  cheqne  and  obuins  the 
cash   In   a   few   minutes. 

As  there  will  of  necessity  be  a  slmlar  delay  In  with- 
drawing funds  from  the  Provincial  fund,  this  will  largely 
offset  the  extra  one  per  cent.  Most  will  connider  the  bank 
service  worth  the  difference. 

The  regulations  of  the  new  department  appear  to 
segregate  the  deposits  from  the  funds  secured  by  bond 
Issues,  the  former  to  be  utilized  entirely  for  short  date 
loans,  and  any  advances  for  the  purchase  of  land  or 
machinery  to  come  solely  from  the  Issue  of  special  bonds. 
Any  other  system   would  spell  trouble. 

Bank   PlRures  H»»e  Fallen  Off 

Bank  deposits,  loans  and  discounts,  call  loans,  all  show 
a  decline  from  the  previous  year,  but  as  the  purchasing 
power  of  money  has  materially  increased  during  the  same 
period,  the  reduction  is  more  apparent  than  real.  Circul- 
ation Is  down  from  the  high  level  of  1920.  the  prices  of 
commodities  having  fallen,  less  curCency  Is  required  In 
the  ordinary  dally  buying  and  selling. 

Acceptances  under  Letters  of  Credit  are  reduced  about 
50  per  cent.,  indicating  either  a  falling  off  In  the  pur- 
chases of  foreign  goods  or  a  change  in  the  method  of 
arranging   payment. 

The  fluctuation  In  the  rates  of  exchange  will  account 
for  much  of  this,  as  buying  abroad  on  long  terms  of  credit 
at  the  present  time  Is  simply  gambling  in  exchange.  This 
uncertainty  as  to  the  value  of  these  funds  is  one  of  the 
chief  obstacles  to  foreign  trade,  as  it  is  Impossible  to  base 
contracts  intelligently  unless  these  fluctuations  can  be 
estimated    within    reasonable   llmts. 

Forcifcn  Exchange  RaUw 

During  the  year  Foreign  Exchange  has  fluctuated  In 
a  very  wide  range.  Sterling  between  4  and  4.49.  and  New 
York  Funds  ruling  all  the  way  between  IT  per  cent,  prem- 
ium and  8  per  cent,  premium.  The  fall  In  this  latter  ts 
probably  due  chiefly  to  heavy  Canadian  borrowings  In  the 
American  market  through  the  flotation  of  securities  there. 
The  proceeds  of  these  Issues  come  to  Canada  In  the 
shape  of  goods,  not  money,  and  this  Is  true  whether  these 
goods  come  in  after  the  Issue  Is  floated,  or  whether,  as 
In  the  present  Instance,  the  proceeds  are  used  to  pay  for 
debts  Incurred  previously.  Conversely  the  payment  of 
principal  and  Interest  must  be  made  In  goods,  whether 
the  goods  are  sold  In  the  country  to  which  payment  ts  to 
go.  or  whether  they  are  sent  to  some  other  country.  In 
the  latter  case  the  funds  derived  from  their  sale  will  be 
sold  in  the  market  of  the  flrst  country  and  the  debta 
referred  to  paid  from   the  proceeds. 

The  harvest  In  the  West  was  a  disappointment,  the 
wet  weather  materially  reducing  the  grades.  The  price 
has  also  fallen  and  this  will  greatly  affect  the  purchasing 
power  of  that  seoeion  of  the  country  durng  the  cominc 
year. 

A  lUiik  M<itt<>i   IVopoaed 

Since  the  foregoing  '  was  written,  tfaa  amalgamation 
of   the   Merchants      Bank     of     Canada  with  the   Bank   of 


34 


THE      MONETARY      TIMES 


Volume  68. 


Montreal  has  been  announced — subject,  of  course,  to 
ratification  by  the  shareholders  and  the  consent  of  the 
Minister    of    Finance. 

The  reason  given  by  Sir  Montagu  Allan,  President  of 
the  Merchants'  Bank,  was  that  a  valuation  of  the  assets 
of  the  bank  at  the  instance  of  the  Board  showed  a  serious 
impairment  of  the   Rest. 

The  exact  cause  is  not  stated,  and  probably  will  not 
be  given  out  until  the  statement  of  conditions  and  the 
Directors'   explanations   are   submitted   to   the  shareholders 


when   the   meeting  is   called   to  consider  the  offer. 

The  terms  as  stated  are,  one  share  of  Bank  of  Mont- 
rejl  stock  and  a  small  cash  payment  for  two  shares  of 
Merchants'  Bank  stock.  At  present  quotations  this  works 
out  at  11.5  for  the  latter. 

When  the  announcement  was  first  mate  it  appeared 
to  be  well  received,  but  later  some  opposition  developed, 
chiefly  on  the  question  of  principle.  Generally,  however, 
the  offer  is  regarded  as  satisfactory,  both  to  the  Bank  of 
Montreal    and    the    shareholders    of   the    Merchants'    Bank. 


Relation  of  Bank  Deposits  and  Loans 

Loans  Have  Fallen  Off  Since  September,  1920,  With  Slight 
Recovery  in  September  and  October  of  This  Year — Course  of 
Deposits     Has     Been      Steadily     Downward     Since     March 


WHILE  the  duties  of  the  modern  bank  are  manifold, 
its  primary  function  is  taking  deposits  from  those 
who  have  surplus  money,  and  in  turn  granting  credit  to 
those  whose  funds  are  deficient.  Our  Canadian  institutions 
do  quite  a  substantial  business  oatside  of  the  country,  but 
it  is  the  purpose  of  this  article  to  deal  with  the  situation 
as  it  existed  last  year  in  the  Dominion  only.  Other  phases 
are  treated  elsewhere  In  this  issue. 

In  view  of  the  above  definition  of  credit,  one  naturally 
expects  to  find  in  a  well-managed  bank  a  fairly  good  margin 
of  deposits  over  loans.  Our  banks  have  always  managed  to 
maintain  a  pretty  good  position  in  this  regard,  although  at 
the  end  of  1920  it  seemed  on  the  surface  to  be  otherwise. 
It  must  be  remembered  that  more  things  enter  into  the 
consideration  than  current  loans  and  savings  deposits, 
although  these  are  foremost  among  the  various  factors. 

An  accurate  survey  would  take  current  loans,  call  loans, 
loans  to  provinces  and  municipalities,  and  loans  to  the 
Dominion  Government,  and  place  these  up  against  savings 
and  demand  deposits,  and  deposits  of  the  provincial  and 
Dominion  Governments.  Even  these  do  not  represent  the 
absolutely  true  condition  of  affairs,  for  the  bank  statement 


does  not  show  the  loans  to  the  Dominion  Government 
separately,  and  the  figures  used  under  this  head  partly  in- 
clude Provincial  Government  securities.  On  the  other  side, 
demand  deposits  and  the  funds  at  the  credit  of  the  Do- 
minion Government  cannot  be  relied  on  to  a  very  -large 
extent  as  a  'basis  for  extending  credit. 

However,  the  comparison  of  the  accounts  represented 
above  gives  as  good  a  solution  of  the  problem  as  is  possible, 
and  the  results  of  the  past  twelve  months  are  quite  interest- 
ing and  Illuminating. 

An  Exceptional   Movement 

It  is  a  strange  but  true  fact  that  during  the  past  year  and 
at  the  present  time  the  margin  of  deposits  over  loans  is 
smaller  than  at  the  peak  of  deflation.  That  may  sound 
peculiar  to  the  one  who  is  in  the  habit  of  making  a  super- 
ficial examination  of  banking  figures,  for  in  October,  1920, 
deposits  were  in  excess  of  loans  by  about  $150,000,000, 
while  now  the  deposits  are  in  excess  of  loans  by  approxi- 
mately $50,000,000.  But  it  is  quite  plain  upon  closer 
analysis. 

When  the  easier  money  so  freely  predicted   in  the  fall 


Relation  of  Bank  Loans  and  Deposits 


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January  6,   1922. 


THE      MONETARY      TIMES 


3S 


of  1920  did  not  materialize,  there  was  a  good  deal  of  talk 
about  "frozen  credits."  The  United  States  banks  had  con- 
siderable difficulty  in  this  regard,  and  there  were  "carry- 
overs" in  Canada,  but  the  apparent  discrepancy  does  not 
lie  there.     Here  it  is. 

Working  on  the  premise  outlined  in  the  opening  para- 
graphs, total  deposits  declined  In  the  twelve  months  from 
October,  1920,  somewhat  over  $200,000,000.  At  the  same 
time  total  loans  decreased  only  a  little  over  $100,000,000. 
So  that  the  margin  of  deposits  over  loans  was  reduced  by 
the  difference,  or  $100,000,000.  The  total  loans  at  October, 
1920,  was  $1,723,283,443,  and  the  total  deposits,  $2,143,- 
999,682. 

The  explanation  is  Just  this.  Half  of  the  decline  in 
commercial  loans  was  offset  by  an  increase  in  loans  to  the 
Dominion  Government  and  to  municipalities.  There  is  no 
need  to  go  into  detail  here,  for  the  situation  has  been 
covered  in  a  separate  article.  It  is  sufficient  to  point  to 
the  relation  of  loans  and  deposits,  and  give  a  reason  for 
the  monetary  stringency  which  has  existed,  and  which  has 
puzzled  some. 

Approaching  this  problem  from  another  angle  reveals 
the  same  situation.  The  ratio  of  quick  assets  to  liabilities 
to  the  public  gives  a  good  Indication  of  the  movement  of 


December  .  1,301,804,342  114.703. 24« 

1921 

January    1,264,490,463  113.474.I1S 

February  1.26«.235.381  112,680,4*7 

March...  1,280.982,873  113,818.308 

April ...         1.281,145,047  110,28».586 

May    ....  ,.         1.271.619,281  111,251.188 

June  ...  1.256,642,883  110.77S.140 

July 1.237,093.871  107,562.690 

August 1,226.467.704  106,115,117 

■September     1,239,637,351  106,729.270 

October     1.243.748,818  105,362.186 

The  highest  peak  ever  reached  in  call  loans  was  in 
January,  1920.  when  the  figure  was  $132,015,334.  Tba 
high  peak  for  current  loans  was  in  8epten]A>er,  1920,  at 
$1,417,520,756. 

One  fact  concerning  current  loans  which  should  not  be 
overlooked  Is  concerning  the  agreement  between  the  ranch- 
er's and  cattlemen  and  the  bankers,  through  the  medinm 
of  the  Government.    The  agreement  Is  of  this  nature: 

"Loans  will  be  given  to  any  cattleman  who  shows  tb«t 
he  has  fodder  and  means  of  looking  after  cattle,  and  tliat 
the  security  given  will  be  the  cattle  to  the  full  extent  of 
their  value.      Special   consideration   Is   being   given   to   the 


Course  of  Bank  Loans 


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YEAR 


loans  and  deposits,  the  excess  of  the  latter  over  the  former 
being  reflected  in  the  trend  of  cash  and  equivalent  re- 
sources. The  ratio  at  November,  1920,  was  24.34  per  cent. 
By  July,   1921,  it  w^as  21.60  per  cent. 

Current  Loans 

In  view  of  the  deflation  which  has  taken  place  during 
the  twelve  months  that  have  passed,  it  Is  hard  to  detect 
the  usual  seasonal  movements.  Farmers,  and  particularly 
the  Westerners,  have  always  required  large  credits  during 
the  spring,  summer  and  early  fall.  They  did  this  year,  but 
not  any  greater  than  in  the  previous  year,  for  prices  of 
grain  and  other  products  fell  to  such  an  extent. 

Call  loans  fell  off  largely,  due  to  the  dullness  In  the 
security  markets,  but  more  chiefly  to  the  depreciation  in 
the  security  prices  and  the  irregularity  and  uncertainty  of 
the  markets.  The  following  figures  show  the  trend  of  both 
these  Canadian  loans  accounts: — 

Loans  Current  in  Call  in 

1920  Canada  Canada 

August $1,385,470,153  $113,598,923 

September    1,417.520,756  114,669,611 

October    1,405,401.227  •     113.135,902 

November    1.357,973.118  108,471.340 


J92J 

matter  of  the  period  of  the  loans  and  the  renewals  of  loans. 
Until  the  markets  become  normal  forced  liquidation  will 
not  be  permitted.  Ten  million  dollars  is  the  total  credit 
arranged  in  order  to  make  a  start  on  this  plan,  and  In  view 
of  the  agreement  the  Government  will  be  able  to  uke  ap 
with  the  various  banks  concerned  any  case  where  there  has 
been  a  refusal  of  a  loan." 

Apparently,  this  has  been  working  satisfactorily,  tor 
nothing  much  further  has  been  said  upon  the  subject.  In 
this  way  Canadian  cattle  raisers  are  being  carried  arvt  the 
period  of  abnormally  low  prices,  by  advance*  from  tbe 
banks,  which  are  secured  by  stock. 

I>epoRlts  Have  Shnmk 

The  shrinkage  In  deposits  during  the  past  twelve  months 
has  been  considerable,  but  not  out  of  proportion  to  current 
loans.  As  already  pointed  out,  the  total  deposits  deer««Md 
more  than  the  total  loans,  but  that  was  not  the  fault  of  the 
deposits,  but  of  the  unusual  situation  In  loans. 

Demand  deposits  showed  a  reduction  of  more  than 
$100,000,000.  However,  in  view  of  the  big  drop  in.current 
loans,  and  the  general  business  conditions  which  prevailed, 
this  is  not  a  very  important  consideration.  It  is  Just  repre- 
sentative of  the  deflation  which  has  Uken  pUee. 


36 


THE       MONKTARY       TIMES 


Volume  68. 


Of  more  interest  is  the  movement  of  savings.  At  first 
it  seemed  as  though  notice  deposits  were  destined  for  a 
career  opposite  to  that  of  other  phases  of  the  banking 
situation.  But  such  a  violation  of  the  economic  law  was 
not  possible,  and  in  March  started  the  downward  trend, 
which  grew  more  severe  as  the  year  proceeded.  The  follow- 
ing figures  show  the  course  of  the  principal  Canadian  deposit 
accounts  since  the  climax  of  prosperity:  — 

Deposits 
1920  on   demand 

August $640,361,707 


September 
October    .  . 
November 
December  . 

1921 
January   .  . 
February    . 
March     .  .  . 
April     .  .  .  . 

May    

June 

July    

August  .  .  . 
September 
October 


677,286,905 
687,651,781 
686.754,094 
657,496,742 

584,025,710 
561,578,474 
660,937,663 
552,121,294 
552,868,059 
562,194,316 
525,085,166 
527,362,713 
534,307,452 
565,650,636 


Deposits 
after  notice 
$1,261,647,732 
1,270,194,097 
1,271,275,751 
1,292,009,008 
1,293,007,488 

1,313,093,870 
1,318,855,482 
1,319,142,196 
1,313,832,514 
1,315,282,372 
1,308,775,473 
1,295,226,768 
1,279,830,731 
1,263,763,852 
1,251,323,839 


The  Inevitable  Result 

There  is  only  one  course  which  notice  deposits  can 
follow  in  the  cycle  of  depression,  and  that  is  downward. 
For  one  thing  the  large  amount  of  unemployment,  ibrought 
about  by  the  excessive  slackness  in  business,  is  bound  to 
make  substantial  inroads  on  savings.  Furthermore,  the 
decline  in  prices  is  always  accompanied  by  lower  wages. 
Some  sections  of  labor  during  the  past  year  have  had  their 
pay  cut  from  40  to  50  per  cent.  This  is  bound  to  be  shown 
in  the  country's  savings.  Of  course,  the  family  budget  is 
not  so  costly,  because  of  the  drop  in  prices,  and  measured 
on  the  percentage  basis,  savings  will  be  what  they  were  in 
ihe  prosperous  time,  or  near  there,  but  expressed  in  dollars 
and  cents  there  will  be  a  big  difference. 

Another  factor  which  may  affect  the  savings  of  the 
people  in  the  banks,  is  the  growing  knowledge  of  invest- 
ments,  which   received   its   initiation   during   the   war   loan 


campaigns.  Many  people  who  were  previously  content  to 
receive  three  per  cent.,  from  the  'banks,  are  now  waking  up 
to  their  opportunities  to  make  six  and  seven  per  cent. 
Interest  rates  are  falling,  but  will  not  drop  much  below 
six  per  cent. 

One  man  remarked:  "I  don't  see  why  I  should  give 
my  money  to  the  banks  to  lend  out  at  interest  rates  more 
than  double  what  I  receive  for  my  funds,  when  I  can  do 
that  just  as  well  myself."  This  possibly  expresses  the 
opinion  of  a  good  many,  although  its  effect  has  not  yet  been 
reflected  in  the  banking  figures.  But  it  is  something  which 
the  banks  may  have  to  contend  with  in  the  future. 

Increasing  Competition 

It  also  seems  as  though  savings  deposits  in  the  banks 
are  destined  to  receive  a  further  set-back  through  increas- 
ing competition  from  other  quarters,  chiefly  loan  and  trust 
and  insurance  companies. 

Because  sound  finance  requires  depositaries  of  public 
savings  to  be  at  all  times  prepared  to  meet  demands  upon, 
strict  limitations  have  been  placed  on  loan  and  trust  com- 
panies, which  are  incorporated  under  provincial  or  Do- 
minion laws.  Ontario  companies  have  been  permitted  by 
legislature  to  enlarge  their  deposit-  receiving  powers.  A 
similar  movement  is  on  foot  concerning  the  Dominion 
companies. 

The  difficulty  as  far  as  the  banks  are  concerned  is  that 
the  loan  and  trust  companies  offer  a  slightly  higher  rate 
of  interest.  Any  wise  legislation  passed  will  not  jeopardise 
the  public's  Interest,  and  the  public  realizes  this.  So  that 
some  people  will  be  willing  to  turn  their  savings  over  to 
the  trust  and  loan  companies  for  the  sake  of  the  slightly 
higher  remuneration. 

As  regards  insurance,  this  is  a  factor  which  should  not 
be  overlooked.  All  life  insurance  companies  are  empha-' 
sizing  the  saving  opportunities  in  insurance  and  the  profit- 
able return.  SuflSce  it  to  say  that  most  wise  young  men 
and  women,  who  would  otherwise  use  the  banks  for  their 
spare  funds,  are  taking  the  hint  from  the  insurance  agents. 

All  of  these  things  have  not  as  yet  become  serious,  but 
it  certainly  seems  as  though  they  are  matters  which  de- 
mand the  earnest  attention  of  the  banks.  Bank  savings  are 
used  to  purchase  short-term  commercial  paper,  and  are 
vital  to  the  country's  business. 


Course  of  Bank  Deposits 


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January  6,   1922. 


THE      MONETARY      TIMES 


S7 


How  Our  Currency  Requirements  Are  Met 

Government's  Gold  Reserve  As  At  March  31st  Last  Was 
Lowest  in  Past  Eight  Years — Government  and  Bank  Note 
Circulation     Has     Shown      Reduction      in      Recent     Months 


AMONG  the  many  trade  Indices  which  guide  our  thoughts 
concerning  the  business  welfare  of  the  country,  perhaps 
the  best  In  the  volume  of  currency  required  In  the 
day  to  day  transactions  in  the  field  of  commerce.  La.st  year 
was  one  of  readjustment,  which  is  clearly  reflected  in  the 
trend  of  outstanding  ndtes  of  the  llominlon  Rovernraent 
and  of  the  chartered  banks  since  the  peak  of  prosperity  in 
the  fall  of  1920. 

Over  a  period  of  twelve  months  the,  decline  in  the  com- 
bined circulations  has  been  ai^roximately  $120,000,000,  or 
21.50  per  cent.  One  can  appreciate  these  facts  more  when 
it  is  understood  that  the  index  num'ber  of  commodities  has 
dropped  from  326  to  232  in  the  same  period,  which  means 
that  wholesale  prices  have  fallen  nearly  30  per  cent.,  speak- 
ing on  the  whole.  There  is  also  tlip  low"--  ir.H,.  -.ffivity 
to  be  taken  into  account. 

During  1920,  note  circulation  largely  iiicnasiil  ni  nearly 
every  country  in  the  world,  and  while  the  movement  in 
Canada  was  not  nearly  so  extensive  as  in  some  of  the 
European  countries,  the  issue  of  specie  and  subsidiary 
coin  here  was  very  large,  and  grew  all  out  of  propctrtlon 
to  the  gold  standard. 

Despite  the  fact  that  the  Canadian  dollar  was  at  a  large 
discount  in  the  United  States,  where  a  sound  position  was 
maintained,  it  was  one  consolation  to  note  that  our  money 
was  at  a  premium  in  Europe,  where  currencies  were  in  a 
hopeless  state.  Even  Great  Britain  was  far  from  a  gold 
basis. 

Gold  Ratio  Still  liOtv 

While  there  has  been  some  improvement  in  recent 
months,  the  ratio  of  gold  held  to  Dominion  notes  outstand- 
ing Is  still  low.  In  November,  1920,  the  figure  was  about 
29.50  per  cent.  By  March,  1921,  it  reached  its  lowest  point 
at  29  per  cent.  Now  it  is  approximately  31  per  cent.  Can- 
ada's currency  was  about  as  near  a  perfect  gold  basis  in 
1914  as  it  will  be  for  some  time  to  come.  Since  that  year 
there  has  been  a  declining  movement.  Not  only  has  circu- 
lation increased,  but  gold  holdings  have  dropped.  The 
following  table  is  illustrative:  — 

Notes  Gold 

March  31  outstanding  held  Percent. 

1914     $114,000,000         $    92,000,000  81 

1915  152,000,000  89,000,000  59 

1916  175,000,000  114,000,000  65 

1917  178,000,000  119,000,000  67 

1918  281,000,000  114,000,000  41 

1919  329,000,000  118,000,000  39 

1920  312,000,000  100.000,000  32 

1921  278,000,000  80,000,000  29 

It  is  pretty  well  known  ui)on  what  basis  Dominion  notes 
are  supposed  to  be  issued,  but  by  way  of  review  it  might 
be  mentioned  that  under  the  Act  of  1914  a  reserve  of  25 
per  cent,  in  specie  against  the  first  fifty  millions  is  called 
for,  and  dollar  for  dollar  either  in  gold  or  approved 
securities  for  any  issue  over  this  amount. 

UiK-overefl   Amount 

The  government  has  adhered  to  the  above  principles 
as  close  as  possible,  stepping  slightly  beyond  the  mark 
when  the  strain  became  rather  great  at  the  height  of  the 
crop-moving  season  of  1920.  Of  course,  the  additional 
issues  had  to  be  covered  by  securities,  there  being  no  gold 
available. 

At  the  end  of  November,  1920,  after  taking  Into  con- 
sideration the  gold  and  securities  held,  there  was  left  un- 
covered  notes   amounting   to   about   $.')6,000,000.      The  de- 


flation has  enabled  that  figure  to  be  reduced  to  about 
$37,000,000,  but  the  proportion  of  gold  has  not  changed 
very  much.  The  following  table,  compiled  by  The  MoneUry 
Times,  gives  a  detailed  outline  of  the  course  of  government 
note  circulation  and  Its  security  in  the  past  two  rears: — 

Notes  Gold  Notes  Against 

1920 —             Outstanding  Hc.^ervo  Socurlties 

January     $303,678,278  $105,165,301  $149,289,375 

February     .       ,     305.404.160  105.609.980  151,064.375 

March    311,932,791  100.286.280  157,566.726 

April     309,142,651  101,636.652  154.262.225 

May    300,241.483  102,495.683  146.056.726 

June 292.016,290  99.619.182  138.038.125 

July             293.541.399  95.510.383  139,749.126 

August 292.086.025  95.183.753  138.437.125 

Septemer    ..     .    303.065.376  95.205,901  149.620.125 

October    ..            320.012,915  95.222.381  166.715,126 

November    ..    .    326,839.692  96.021,001  173,689.026 

December    ..    .    311,714.486  97,145,774  16g,707,»<0 

1921  — 

January    ..     ..    293,619,721  98,036.621  140,623,076 

February    ..     .    290,194,519  99.149,529  137,115.075 

March 277.882,884  79,514,480  134.632.876 

April    263,706.491  81,132.601  147,172.375 

May    256,691,698  82.612,482  138,963,376 

June     268,769.184  83,854.487  150.879.376 

July    263,459,426  85,034.359  145,541,964 

August 262.157,315  81,422,964  144,203,800 

September  .  .    .    259,923.195  80,645,895  141,961.267 

Bank    Circulation 

The  course  of  bank  circulation  has  naturally  been  in 
line  with  that  of  the  Dominion  government's  specie  tssna, 
falling  some  $60,000,000  in  the  course  of  a  year.  The  de- 
crease is  greater  in  proportion  than  that  registered  by 
government  circulation,  because  the  Tolume  of  bank  notes 
is  smaller. 

The  amount  of  notes  outstanding  at  the  end  of  each 
month  for  the  past  four  years,  as  shown  by  the  banks' 
statements  to  the  department  of  finance,  hare  been  as 
follows: 

1918  1919                1920                1921 

January     .  .  tl71,i>74.4t>4  f2'^-  J"'  '"'  *-i<?  «ui.91«  «20«,17S,821 

February    .  i:(i.3<iH.L'!>r>  ;                                      781     207.417.917 

March     ...  191,05,h.404  :                                        ■'•^     •'■•■•  ■>94,6«8 

April     ....  lS0,r.r)4,mi4  :                                                         .'7S.M8 

Mnv  '-'  V   -*..-.,  ..,,      ,;.,,.^i33,999 

Ju:  253      liK.67S.217 

July     l^,,^' .,.>.,  .                                            ".'^39.096 

August    .  .  .  200.S3<).iii;o  r.30.419 

September   .  ^ll.tl-j.i.sr.r.  .                                                      "  "  "21 

October     .  .  JJT.,-)!>r.si)>*  :                                                              SS 

November   .  234.082.978 

Dt-cemher    .  224,501.117 

I'nder  the  Bank  Act.  banks  are  autborlied  to  laaae 
notes  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  lleserTo  an  amonnt  equal  to  such  ex- 
cess in  gold  or  Dominion  notes.  In  addition  each  ba&k 
may,  during  the  crop-moving  period,  from  September  1  to 
April  30.  inclusive,  issue  up  to  16  per  cent,  of  its  com- 
bined capital  and  rest,  and  on  this  excess  Interest  mast  be 
paid  the  government  at  the  rate  of  5  per  cent,  per  aanwa 
by  way  of  tax.  As  a  war  measure  this  excess  was  aathor- 
ized  by  the  Finance  Act  of  1914.  during  the  Iwlaace  of 
ih<<  year,  but  this  has  not  been  arailed  of  to  any  extent  (or 


38 


THE      MONETARY      TIMES 


Volume  68. 


the  last  few  years,   the  banks  preferring  to  use  the  gold 
reserve. 

The   following   table   will   make   the  above   facts   quite 
clear  (ciphers  have  been  omitted): — 

1920  Cap. 

October $127 

November     12  8 

December 128 

1921 — 

January    128 

February    .  .'    128 

March    129 

April 129 

May 129 

June    129 

July    .  .    129 

August    129 

September    129 

October     129 


BANKERS'   ASSOCIATION   EDUCATIONAL.  COURSES 


Votes 

Reserve 

Excess 

$249 

$119 

$3,000,000 

234 

115 

229 

113 

206 

90 

207 

88 

206 

95 

203 

89 

193 

84 

196 

79 

193 

77 

184 

75 

187 

75 

194 

75 

Lectures    Inaugiirat<»<l    In    Montreal    and    Toronto    Now 
Supplement  Correspondence  Courses 


It  must  be  understood  that  the  deposits  In  the  Central 
Gold  Reserve  are  only  partly  gold,  the  figure  now  being 
about  $10,500,000,  with  the  balance  in  Dominion  notes.  It 
will  be  realized  then  that  the  decline  in  the  bank  circula- 
tion during  the  past  year  has  had  an  important  effect  upon 
government  circulation,  because  the  need  for  Dominion 
notes  for  reserve  purposes  has  been  much  smaller,  as  the 
above  figures  indicate. 

Seasonal  Movements  Not  Apparent 

Because  of  the  effect  which  was  produced  by  the  read- 
justment in  business,  the  usual  seasonal  movements  in 
circulation  generally,  were  not  apparent.  Circulation  com- 
mences about  February,  due  principally  to  the  require- 
ments of  the  lumber  industry.  March  also  calls  for  in- 
creased circulation,  as  in  this  month  lumbering  camps  are 
paid  off.  In  April  and  May  most  of  the  circulation  is  re- 
deemed as  the  lumbermen  return  from  the  woods  and 
pay  their  family  bills  for  the  winter. 

June  shows  considerable  rise  in  issue,  as  navigation 
opens,  lumber  drives  are  completed  and  men  are  paid  off. 
July  is  usually  redemption  month,  for  many  factories  close 
for  stock-taking,  and  in  addition,  being  the  centre  of  the 
holiday  season,  payrolls  are  reduced.  Many  people  also 
leave  the  country  for  abroad,  and  purchase  travelling  funds. 

August  calls  for  more  money  as  farm  products  are  being 
disposed  of,  and  the  issue  gains  momentum  through  Sep- 
tember, October,  and  November,  as  the  grains  and  other 
products  are  being  marketed.  In  December  and  January 
the  return  of  currency  after  the  crop  movement  takes 
place.  Of  course,  these  movements  will  be  affected  by  early 
or  late  seasons. 

The  figures  of  average  circulation  given  in  the  bank 
statement  each  month,  show  some  very'  interesting  results 
in  the  past  few  years.  The  following  table  shows  the 
highest  and  lowest  monthly  average  since  the  beginning  of 
1917: — 

Highest  Lowest 

1917     $208,753,337  $142,589,098 

1918    242,309,082  181,695,542 

1919    248,073,385  210,894,809 

1920    253,576,534  223,979,666 

1921     229,608,213  197,461,372 

A  detailed  analysis,  if  there  were  room  to  give  it,  would 

show  that  during  the  years  the  lowest  point  has  always 
been  around  February,  and  the  highest  around  November 
or  December.  The  past  year  has  been  an  exception,  how- 
ever, because  of  the  unusual  events. 


During  the  first  week  of  May,  1921  the  additional 
$500,000  of  National  Trust  Co.  stock,  issued  In  June,  1920, 
was  listed  on  the  Toronto  stock  exchange. 


At  the  1921  session  of  the  Quebec  legislature,  the 
organization  periods  of  the  Scottish  Trust  Co.  and  of  the 
Anglo-American  Trust  Co.  were  extended  to  July  1,  1921. 


By  A.  B.  BARKER 

•T'  HE  various  educational  courses  under  the  auspices  of 
*  the  Canadian  Bankers  Association  are  attracting  an 
increasing  amount  of  attention  in  the  profession,  and  the 
number  of  students  enrolled  for  both  the  senior  and  junior 
work  is  growing  steadily  year  by  year.  These  courses  are 
by  correspondence,  and  have  been  chiefly  used  by  members 
of  the  staffs  of  the  different  banks,  below  the  rank  of  Man- 
ager, though  many  of  the  junior  managers  have  taken 
advantage  of  the  opportunities  afforded  by  these  systems  of 
directed  reading  and  study  in  both  practical  and  theoretical 
banking. 

Popular  With  Managers 

In  addition  to  these  courses,  which  have  now  been  in 
operation  for  about  ten  years,  a  series  of  lectures  on  bank- 
ing and  mercantile  law  and  similar  subjects  was  instituted 
in  Toronto  and  Montreal  last  year  under  the  supervision 
of  local  educational  committees,  and  these  have  had  marked 
success.  These  have  in  particular  appealed  to  the  Managers, 
so  much  so  in  fact,  that  many  men  below  that  rank  have 
been  crowded  out  this  year,  as  only  a  limited  number  of 
students  could  be  accommodated,  and  the  response  was  far 
in  excess  of  expectations. 

In  the  country  branches,  however,  a  system  of  this  kind 
is  out  of  the  question,  and  the  method  most  satisfactory 
for  those  in  the  outside  branches  is  the  correspondence 
course.  In  this,  the  subject  of  study  is  divided  into  a  num- 
ber of  lessons,  with  a  list  of  questions  at  the  end  of  each, 
based  on  the  matter  dealt  with.  These  are  answered  in 
writing,  and  reviewed  by  an  instructor  who  returns  them 
with  his  comments.  For  the  students  in  the  Associates  and 
Fellows  Courses  this  is  of  peculiar  benefit,  as  it  gives  them 
an  opportunity  of  asking  questions  on  points  which. occur 
to  them  in  their  reading,  and  which  may  not  have  come 
before  them  in  actual  practice. 

Nee<l  for  Training 

The  development  of  banking  in  Canada,  through  the  wide 
extension  of  the  branch  system,  has  made  such  a  method 
of  education  absolutely  essential.  In  the  old  days  of  bank- 
ing, when  the  number  of  branches  was  very  limited,  the 
men  had  opportunities  of  seeing  the  different  classes  of 
business,  as  in  the  ordinary  course  of  his  service  in  the 
bank  a  man  would  get  experience  in  both  city  and  country 
branches. 

Also  promotion  was  slower,  and  it  was  usually  a  matter 
of  ten  or  twelve  years  before  one  could  expect  a  manager's 
post,  and  the  experience  gained  in  that  time  would  in  all 
probability  have  covered  something  of  all  of  the  problems 
likely  to  present  themselves.  That  system  of  education 
was  the  so-called  'practical,"  so  dear  to  the  old  timer,  but 
after  all  it  was  in  many  cases  merely  a  drilling  in  the 
routine  work,  it  gave  no  idea  of  the  theories  on  which  the 
practice  was  based. 

Theory  in  some  quarters  is  looked  on  somewhat  scorn- 
fully. But  itself,  of  course,  it  is  a  weak  sister,  and  must 
be  allied  to  practice  in  order  to  produce  results.  Theory, 
however,  is  a  statement  of  the  reasons  for  any  procedure, 
and  unless  a  practical  man  can  give  his  reasons,  when  he 
wants  to  convince  others,  he  will  not  go  far. 

The  courses  referred  to  cover  a  wide  range,  economics, 
practical  banking,  foreign  exchange,  accounting,  and  audit- 
ing, and  also  a  course  in  Spanish. 

Value  of  Training 

The  banks  offer  many  inducements  to  the  members  of 
their  staffs  to  take  up  these  courses.  They  will  advance 
the  fees,  and  if  the  student  passes,  the  debt  is  usually  can- 
celled, in  part,  if  not  altogether,   and   some  banks  offer  a 


January   6,   1922. 


THE      MONETARY      TIMES 


bonus  to  students  who  attain  a  certain  standard  in  tbe 
yearly  examinations.  It  is  understood,  too,  that  this  stand- 
ing will  have  a  bearing  on  the  promotion  of  an  officer, 
though  so  far  it  has  not  been  made  ob'.igatory.  Whether 
there  will  ever  be  an  actual  rule  to  this  effect  is  doubtful, 
but  In  practice  it  is  bound  to  be  more  or  less  the  case,  as 
the  prol)lems  of  business  are  becoming  more  complicated, 
and  will  therefore  require  the  services  of  men  with  a  higher 
technical  training.  This  has  long  been  recognized  in  (Ircat 
Britain,  where  the  Institute  of  Bankers  has  for  many  years 


had  In  operation  a  system  of  education  for  bankara  on  tb« 
lines  on  which  the  Canadian  banks  are  oi>«ratlng. 

In  the  United  States,  tbe  New  York  banks  bare  taken 
hold  of  the  matter  In  a  tburougb  way.  There  tbe  larger 
institutions  maintain  schools  of  their  own.  The  National 
City  Bank,  in  preparing  its  men  for  service  abroad,  gires 
them  a  thorough  grounding  In  tbe  laws,  business  and  bank- 
ing customs  of  tbe  country  to  wblcb  tbey  are  to  be  sent, 
knowing  that,  unless  their  men  are  thus  equipped,  their 
efforts  as  representatives  of  tbe  bank  abroad  will  be 
seriously  handicapped. 


Canadian  Banks^  Net  Profits  and  Dividends 


BANK. 

(1)  Bank  of  Montreal 

§Qufl)(!0  Bank   

Bank  of  Nova  Scotia 

(2)  Bank  of  North  America   

Bank  of  Toronto 

The  Molsons  Bank   

La  Banque  Nationale 

(3)  Merchants  Bank  of  Canada  .  . . . 

Banque  Provincials  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    

Weyburn  Security  Bank   


I     1911 
[Net  Profits 

$ 

2,276,519  I 

276,392 

815,519 

632,117 

677,964 

712,539 

262,513 

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 

,     285,964 

,1    107,876 

26,682 


13 


Divl-      1912 
dend  Net  Proflts 
%  $ 

10 
7 
&  14 
8 
11 
11 
7 


2,518,409 
294,804 
970,554 
,    678,506 
I    835,787 
j    684,779 
I    293,564 
9  &  10  1,338,884 

5  ;    185,165 
8     '    706,832 

2,811,806 
1,527,324 
901,529 
495.860 
462,079 
481,616 
640,220 
&  12  1,004,340 

6  I    140,030 
6    '    291,094 

5     1    113,400 
2  \i '      63,135 


10 
12 
12 
11 
13 
9 
11 


11 


5& 


Divi- 
dend 

% 

10+2 

7 

14 

8 

11  +  1 
11 
7 
10 
6 
8 
10+1 
12 
12+2 
12 
13 
9 
11% 
12 
6  &  7 
6 
6 
5 


1913 

Net  Proflts 

9 

2,648,403   ; 

309.228  I 
1,210,774 

689,745  I 
*l,050,693i 

694,356   I 

302,304  I 
A  633,663  I 
,    190.126    ' 

760,096 
2,992,961 
2,142,100 

950,402 
I  498,273 
I    555,095 

634,700 
'  706,746 
1,125,971 
,  167,125 
'  281,167 
!  114,200 
i      54,917 


Divi- 
dend 
% 
10+2 
7 
14 
8 
11  +  1 

n 

10 
6 

8 
10+2 
12 

12+2 
12 

IX 

<t 

12 

12 


1914 
Net  Proflts 

I 

2.496,452 
296,659 

1,196.117 
636,677 
829.538 

■■3 

1,213,694 

194,214 

712,440 

2,668,233 

1,886,142 

925,364 

i\-,.2r,5 

■:3 

•    H 

t)2U,ti91 

1,236,984 

ir,:?,!i29 

11.5,111 
.   48,354 


Divi- 
dend 

10+2 
7 
14 
8  I 
11+1 
11 
8 

le 

7 
8  +  1 
10+2 
12 
12  +  2 
12 
13 
9 
12 
12 
7 
6 
6 
6 


1916 

JNet  ProflU 
I 

2,108.631 
233,420 

1,220.067 
328,595 
668,074 
656, 193 
333.207 
996,431 
196,366 
659.68S 

2,362,035 

1,»05,576 
806,123 
424,274 
663.401 
630,237 
631.268 

1.031,369 

133.406 

-100.789 

145,290 

53.844 


BANK. 


1916 
Net  Proflts 


(1)   Bank  of  Montreal    2,200,471 

§Qupbec  Bank   

Bank  of  Nova  Scotia   1,252,038 

l2)   Bank  of  North  America    546,346 

Bank  of  Toronto  730,954 

The  Molsons  Bank   582,356 

La  Banque  Nationale 417,662 

(3)  Merchants  Bank  of  Canada 950,713 

Banque  Provincials  du  Canada  . .     203,983 

Union  Bank  of  Canada 651,183 

Canadian  Bank  of  Commerce  ...  2,439.415 

(4)  Royal  Bank  of  Canada 2,111,307 

Dominion    Bank    893,502 

(5)  Bank  of  Hamilton  442,525 

Standard   Bank  of  Canada   580.230 

Banque  d'Hochelaga 546.011 

(fi)     Bank   of  Ottawa    591,205 

Im|)crial  Bank  of  Canada   1,003,960 

Home  Bank  of  Canada  217,059 

(7)    Northern  Crown  Bank |    128,761 

Sterling  Bank    !    161,270 

Weyburn  Security  Bank  i      82,149 


Divl-        1917 
dend  Net  Proflts 
%    '         $ 
10+2    2,477,969 


14 

7 

11 

11 

8 

10 

7 

8+1 

10+2 

12 

12 

12 

13 

9 

12 
12 
5 
5 
6 
5 


1,295,315 

**668,003 

802,920 

615.514 

435,283 

1,236,680 

207,483 

763,463 

2,637.555 

2,327,979 

1,005,062 

598,522 

649,546 

565.433 

616,238 

1,185,066 

228,963 

t208.608 

186,120 

74,274 


Divl-        1918 
dend  Net  Proflts 
%  » 

10+2    2,562,720 


14 

8 

11 

11 

9 

10 

7 

8+1 

10  +  2 

12 

12 

12 

13 

9 

12 

12 

6 

6 

fi 


1,411,925 

,"844.402 

i    712,485 

533,450 

1,383,569 

434,694 

824,174 

2,850,318 

2,809,846 

1,086.498 

571.226 

697,443 

595,187 

645,347 

1,247,616 

238,753 

'  213.632 
■  '.43 


Divl-        1919 
dend  Net  Proflts 
%  $ 

10+2    8,314,227  j 


Divl-        1920 
dend  Net  Proflts 
«  « 

12      4,033,995 


14      1,925,478  .        10      2,327,422 


11 
11 

9 
10 

7 
10 
10+2 
12 
12 
12 
13 

9 

12 
12 


1,011,369 

818.,S02 

667,372 

1,686,166 

B  333,882 

932,256 

3,074,892 

3.423.264 

1,169.703 

847.104 

776,310 

■    611.106 

1.379.318 
268,896 

251.346 
62.220 


12 

12 

10 

12  +  1 

8 

10 

12 

12+2 

12+1 

12 

IS 

10 

12+1 


1,017.371 

822J18 

544.945 

1.402.820 

426.647 

1.603.842 

3.306.243 

4.253.649 

1,347.011 

888.018 

784.369 

649,739 

1.287.061 

37.<!  aSfi 


60.4;' 


Divi- 
dend 

% 
10+2 

7 
14 

7 
U 
11 

8 
10 

7 
8+1 
10  +  2 
12 
12 
12 
12 

9 
12 
12 

5 
NU 

6 
»10 

DiTl- 

deod 

% 
12 


"ii 

IX 
12 

12+1 

9 
10+2 
12+1 
IS+S 

1 

M 

10 

12+ 1 

7 


(1)  Prior  to  1904  the  Bank  of  Montreal's  year  ended  In  April. 
The  profits  during  1911  include  |708,800  expended  and  those 
of  1912,  $511,000;  In  previous  years  these  expenditures  were 
deducted.    2';'r  bonus  since  June,  1912. 

(2)  Figures  for  1912  are  from  Jan.  1st  to  Nov.  30th  Inclusive. 

(3)  191>8  figures  are  for  6  months  ending  30th  April.  1915 
figures  are  for  year  April,  1915.  Net  proflts  for  year  end- 
ing April,  1916,  $970,713.     Dlviden^,  10%. 

(4)  1912  figures  are  tor  11  months;  financial  year  changed. 

(5)  The  1917  figures  are  for  the  15  months  ended  28tli  February. 
1918. 

(6)  The  Bank  of  Ottawa  was  absorbed  by  the  Bank  of  Xnvn 
Scotia  in  May,  1919. 

(7)  1912  proflts  are  for  11  months. 


t  5%  cash  dividend  and  5T-  stock  dividend. 

•  Including  $200,000  debts  rtvovored. 

I  The  Quebec  Bank  was  purchasetl  liy  tJ>e  Koyal  Bank  of  Canada 

on  December  31st.  1916,  and  did  not  issue  a  statement  show. 

ing  the  result   of  its  business   for  that   year.       Dividends 

amounting  to  $191,450,  l)elng  at  the  rate  of  "•>  m-r  annam. 

were  paid  during  the  year. 
(a>   Result  of  business  for  B  months  onl> 
(fi)   Figures  for  the  previous  period  were  [or   is  months.  Tlicrc 

was    a    jiroiHirtlonate    increase    of     $44,512    on     a     l»>Ive 

1'.    ■  "'      '  .isls. 
•*  Al'  tbe  Bank  of  Montreal.  March.  1918. 

t  Pni,  -     ■>'••    Moyal   Bank.   June   SOth,    1918.   who   paM 

iH.xv;  'lares  of  the  capital  stock  of  the  Roral 

1!   r.k     .::  ■   In  cash. 


40 


THE      MONETARY      TIMES 


Volume  68. 


Banks'  Services  in  Public  Finance 

Credit  Balances  of  Dominion  Government  Show  Reduction  During  Past 
Two  Years — Provincial  Accounts  Are  Higher — Holdings  of  Government 
Securities  Have  Advanced — British  Government   Loan  Has  Been  Reduced 


ORIGINALLY,  the  idea  of  a  bank  was  a  place  where  people 
could  place  their  surplus  funds  for  safe-keeping.  The 
work  bank  is  associated  with  the  old  Italian  money- 
changers, but  the  earliest  bank  of  deposit,  instituted  for 
the  accommodation  of  private  merchants,  is  said  to  have 
ieen  that  of  Barcelona,  at  the  beginning  of  the  fifteenth 
century.  This  idea  still  remains  among  the  poorer  classes 
■of  people,  who  have  not  been  taught  differently,  and  whose 
■dealings  have  brought  them  into  contact  with  only  a  small 
portion  of  the  banks'  business. 

The  present-day  conception  of  a  bank  is  generally  much 
broader,  although  the  average  man  does  not  go  much 
deeper  than  thinking  of  an  institution  which  borrows  money 
by  way  of  receiving  deposits  from  the  public,,  allowing  a 
small  remuneration,  and  lending  these  funds  out  at  a  rea- 
sonable return.  During  a  thoughtful  moment,  perhaps 
when  he  is  handling  some  crisp  new  bills,  his  mind  will 
turn  to  the  banks'  currency  business,  and  through  con- 
stantly reading  in  the  press  of  trade,  both  domestic  and 
foreign,  he  will  vaguely  associate  the  bank  with  these 
operations.  Thus  the  banks  get  less  credit  than  is  due  to' 
them.  Only  the  man  whose  business  is  on  a  broad  and 
modern  scale,  or  one  who  is  a  regular  student  of  the  bank 
statement,  can  understand  what  the  banking  business  in- 
volves, and  even  then  it  is  necessary  to  read  between  the 
lines. 


The  task  of  keeping  government  funds  is  not  nearly  so 
big  an  undertaking  as  it  has  been  in  recent  years,  because 
there  have  been  no  war  loans,  but  it  is  still  reasonably 
large.  During  the  past  year  the  Dominion  government  has 
used  up  its  credit  balance  at  a  rapid  rate.  Collections  and 
apparently  the  latter  have  been  in  the  excess.  This  work 
disbursement  of  revenue  is  done  through  the  banks,  and 
for  the  government  is  fairly  extensive,  but  it  is  done  will- 
ingly for  surpluses  are  left,  which  may  be  used.  In 
appreciation  of  this  Dominion  cheques  are  payable  without 
charge  at  all  chartered  banks. 

However,  this  has  not  been  a  very  valuable  source  of 
funds  to  the  banks  during  1921,  owing  to  the  fickleness  of 
the  balance.  Furthermore,  it  must  be  borne  in  mind  that 
the  government  has  been  been  borrowing  rather  extensively 
from  the  banks  in  recent  months,  as  will  be  noted  further 
on,  so  that  the  credit  balance  is  partly  made  up  of  the 
banks'  funds.  When  the  government  would  borrow.  It 
would  not  use  all  of  the  money  at  once,  but  leave  it  with 
the  banks  for  distribution  when  the  time  called  for  it, 
thus  temporarily  enhancing  the  credit  balance.  From  this, 
the  changes  noted  from  month  to  month,  can  be  explained. 

As  regards  the  deposits  of  the  provincial  governments, 
there  is  very  little  to  say.  The  same  irregularity  is  noted 
as  is  the  federal  government  deposits,  which  is  most  likely 
due  to  the  large  volume  of  new  financing  which  has  been 
done   by   the   provinces    in    1921.     As   in   the   case   of   the 


Balances  Due  Dominion  and  Provincial  Governments 


27? 
250 

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Perhaps  one  of  the  biggest  services  rendered  to-day, 
and  the  least  appreciated,  is  the  assistance  in  public 
finance,  that  is,  the  aid  given  to  the  federal  and  provincial 
governments,  municipalities,  and  even  other  governments. 
A  survey  of  the  accounts  in  the  bank  statement  which 
reflect  these  services,  is  most  interesting,  particularly  In 
the  past  two  years. 


Dominion,  after  a  loan  has  been  made  it  is  usually  a  little 
while  before  the  proceeds  can  be  allotted,  and  so  they  are 
kept  in  the  banks  for  safe-keeping,  to  be  distributed  as 
the  time  calls  for. 

The  following  table  shows  the  trend  of  the  credit  bal- 
ances of  Dominion  and  provincial  governments  from  month 
to  month  since  the  beginning  of  1920: — 


January   6,   1922. 


THE       MONETARY       TIMES 


41 


Due  Dom.  Due  Prov. 

1020 —  government  government 

January    $224,.'5!)7,5(}4  $  20,276,072 

February   217,059,832  19,8«4,020 

March  262,340,.';99  17,827,892 

April   261,044,115  19,178,187 

May  216,098,321  20,691,300 

June    y 183,913,852  23,955,524 

July    ..; 170,190,302  26,344,507 

August   153,359,936  25,057,401 

September  15(i,410,480  20,933,968 

October    160,129,252  24,942,898 

November   ™ 136,192,720  18,534,080 

December    118,984,574  19,004,286 

1921-- 

January    $  97,470,729  21,085,858 

February   105,121,289  24,162,783 

March  114,272,486  19,431,985 

April  a05,336,247  25,287,313 

May 131,460,929  23,038,437 

June   .~ 118,368,329  27,175,913 

July 96,147,744  32,630,099 

August   96,389,650  24,786,689 

September   

October  

Iioans  to  Munlcipnlities 

Turning  to  the  loans  made  for  the  assistance  In  govern- 
ment antl  municipal  affairs,  shows  how  valuable  is  the  aid 


expenditures,  for  Invariably  where  a  decline  in  t*x  rmte 
was  shown,  aBsessment  valuation  increaaed.  A  point  in 
illustration  was  Branttord,  which  showed  a  decrease  of 
one  mill  in  rate  and  an  Increase  of  (115,000  in  expenditure*. 
this  result  being  attained  through  an  increase  of  about 
four  million  dollars  In  assessment. 

Of  course,  with  big  increase  in  espendlturet,  and  bearing 
in  mind  the  system  of  municipal  financing  which  Is  general 
throughout  the  country,  the  big  increase  in  loans  Is  readily 
accounted  for.  Perhaps  one  of  the  most  Important  factors 
In  regard  to  increasing  expenditures  Is  the  growing  debt 
charges  which  our  municipalities  are  facing.  Capital  ex- 
penditures, which  were  delayed  during  the  war  period,  of 
necessity  had  to  be  undertaken,  and  with  the  rapid  rise  In 
debt,  larger  appropriations  are  necessary  each  year  for 
interest  and  sinking  fund,  and  annual  payments,  where 
the  debentures  are  of  the  Instalment  type. 

Loans  to  Loans  to   - 

1920—  Provinces  Mun. 

January   «  11.271,190  «  46,147,388 

February  „ _ 13,090,090  52,690,700 

March  13,585,217  62,992.«75 

April   18,768,268  72,281,019 

May  18,887,396  73.904,635 

June    15,773,409  76.410,676 

July  '  1.994,799  78,792,822 

August   12,314,726  79,912,041 

September  „_     13,183,317  78.103,364 

October    14;tr.i,4g5  71.374,060 


O 

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Loans  to  Provinces 

and  Municipalities 

•K) 



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given.  There  is  not  much  to  say  concerning  the  provinces, 
for  these  advances  have  not  been  anything  unusual,  but  on 
the  whole  have  been  rather  steady.  The  situation  of  loans 
to  municipalities  calls- for  comment,  however. 

It  is  a  usual  thing  for  outstanding  loans  to  start  at  a 
low  level  at  the  beginning  of  the  year,  and  increase  many 
millions  in  the  ensuing  months,  for  our  towns  and  cities 
must  have  money  to  meet  current  expenditures  with,  and 
taxes  are  not  available  entirely  until  near  the  end  of  the 
year.  The  municipalities  have  been  criticized  for  such  a 
system  of  financing,  and  the  banks  for  encouraging  it,  for 
It  would  mean  a  big  saving  if  current  expenditures  could  be 
met  by  current  revenue,  without  depending  upon  the  banks. 

But  that  is  not  a  point  for  controversy  here. 

The  main  thing  to  be  brought  out  Is  that  apart  from 
the  regular  trend  there  was  a  big  increase.  After  consider 
ing  the  facts  the  result  is  not  surprising.  The  IP'Jl  budgers 
of  our  municipalities  mostly  showed  substantial  increases 
A  table  of  tax  rates  given  in  THR  MONKTARY  TIMES  a 
few  months  ago  brought  this  out  clearly.  Some  cities  were 
able    to    show    decreases,    but    this   did    not    indicate    lower 


c 

a. 

< 

I  92i 


\ 

Z 


J 
3 


3 
< 


November 
December 

1021 
January 
Februar> 
March 
April  . 

May    

June   

July  _.- 

August  

Septeber  ... 
October    ... 


10..'>71.815 
12,540,947 

12  r.57.149 
.968 

■  r,m 


1. 
11..,....-. 

13.847.231 


a. 


65.487.171 
55,973.926 

59,637.688 
67.719.881 
73,229.646 
79.043.238 
83.745.196 
84.657.919 
83.154.559 
84.093.460 


Iioana  to  the  Donitnlnn 

In  the  bank  statement  there  is  a  column  left  tor  loans 
the  Dominion,  but  this  Is  always  left  blank,  and  to  one 
uuiarailiar  with  the  methods  followed  by  the  govemment. 
this  will  seem  strange.  The  government  do«a  borrow  for 
temporary  needs  from  the  banks,  Just  the  same  aa  the 
provinces  and  municipalities,  and  the  tren4  of  such  loans 


42 


THE       MONETARY       TIMES 


Volume  68. 


is  reflected  in  the  column,  "Dominion  and  provincial  gov- 
ernment securities,"  for  the  federal  borrowings  are  made 
on  short-term  treasury  bills. 

Turning  to  this  account  then,  shows  that  the  treasury  at 
Ottawa  has  been  calling  on  the  banks  quite  regularly  during 
the  past  year,  making  quite  a  substantial  increase  on  the 
whole.  Of  course,  there  are  some  provincial  securities  re- 
presented in  the  figures  given  below,  -  but  the  account 
largely  reflects  to  the  relation  of  the  government  to  the 
banks. 

At  this  stage  it  is  well  to  point  out  that  the  banks  per- 
form a  valuable  service  in  the  purchase  of  securities,  both 
provincial  and  otherwise.  This  is  practically  like  loaning 
money,  for  bond  dealers  in  disposing  of  new  issues  depend 
a  good  deal  upon  the  banks  to  absorb  a  fair  portion,  and 
no  doubt  prices  are  influenced  to  a  certain  extent. 

The  following  tables  shows  the  holdings  of  securities  as 
shown  month  by  month  in  the  bank  statement  over  the  past 
two  years:  — 

Dom.  and  Can.  Mun.  Rly.  and 

1920  Provincial         &  Br.  &  For.         other  bds. 

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 

November 121,250,951  196,671,950  47,050,105 

December    120,489,681  191,172,317  46,494,937 

1921— 

January    122,258,205  193,405,100  46,398,296 

February    123,734,576  190,634,618  46,242,831 

March    124,668,184  184,261,730  46,417,092 


April    135,998,994  179,892,193  46,605,691 

May    173,716,284  173,918,297  46,427,731 

June    175,404,713  167,305,993  45,785,736 

July    180,520,010  159,077,913  45,973,476 

August    179,222,262  147,830,368  45,682,261 

September  

October    

Loans    to    Britain 

From  the  above  it  will  be  noticed  how  the  middle  column 
has  shown  a  marked  and  steady  decrease.  This  has  been 
referred  to  several  times  in  THE  MONETARY  TIMES,  but 
a  reminder  is  necessary.  The  following  table  really  reflects 
the  trend  of  the  outstanding  loan  to  the  British  Govern- 
ment, for  the  proportion  of  municipal  securities  is  small:  — 

1918.  1919.  1920.  1921. 

January  ....$235,989,801  $259,462,077  $249,413,578  $193,405,100 
February  ..  242,256,480  259,422,456  234,608,866  190,634,618 
260,003,939  223,709,931  184,261,730 
258,504,084  214,768,123  179,892,193 
256,617,235  205,129,314  173,918,297 
254,147,015  206,534,550  167,305,993 
'253,490,909  202,471,301  159,077,913 
254,235,984  201,648,011  147,830,368 
255,098,813  202,349,860 
255,684,576  201,447,094 
253,341,708  196,671,950 
255,239,781  191,172,317 
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  renewals  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.  Since  November,  1920,  repayments  have  been 
made  at  the  rate  of  $5,000,000  monthly. 


March    250,422,761 

April    260,978,505 

May    269,102,070 

June   ;...  266,226,264 

July    255,155,438 

August    252,239,043 

September..  250,698,255 

October    250,254,056 

November   ..  248,398,067 
December    ..  253,518,074 


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NEWFOUNDLAND    DEVELOPMENT    PLANNED 


Extensive  plans  for  the  development  of  the  natural 
resources  of  Newfoundland,  with  the  immediate  employment 
of  2,000  men,  were  announced  by  P.  D.  Eeid,  president  of 
the  Reid  Newfoundland  Company,  on  Dec.  14.  He  recently 
returned  from  a  three-months'  visit  to  Great  Britain. 

Mr.  Reid  said  that  while  in  London  he  had  negotiated 
a  contract  with  the  Armstrong,  Whitworth  Company,  Ltd., 
of  that  city  to  develop  the  resources  of  the  Humber  River 


Valley.  Under  the  project,  he  continued,  paper  mills  would 
be  established  twice  the  size  of  the  large  Harmsworth  plant 
at  Grand  Falls,  which  supplies  newsprint  to  the  Northcliffe 
papers  in  London,  with  a  capacity  of  1,000  tons  daily. 

Mr.  Reid  described  the  contract  as  guaranteeing  the  ex- 
penditure of  $7,000,000  within  two  years,  with  the  estab- 
lishment of  aluminum  works  and  other  industries  at  Grand 
Lake  and  extensive  waterpower  development.  He  said  the 
men  to  be  employed  at  once  would  be  used  in  logging  through 
the  winter. 


January   6,   1922. 


THE      MONETARY      TIMES 


43 


Canadian  Banks  in  the  Foreign  Field 

Both  Deposits  and  Loiuts  Have  Declined,  in  Accordance 
with  Business  Conditions  in  Foreign  Countries — Some  New 
Branches  Opened  in  1921,  and  New  Connections  Made 


lly  (JKAHAM  F.  TOWEIU* 

Superintend^t,    Foreign    Trade    Department, 
The   Royal   Bank  of  Canada. 


IT  is  natural  that  the  expansion  in  the  foreign  bunking 
organization  of  Canada,  which  took  place  during  1919 
and  1920,  should  not  have  continued  in  full  force  during 
19131.  The  current  year  has  been  one  of  retrenchment  for 
all  business;  and  the  retention  of  existing  foreign  branches, 
plus  the  establishment  by  the  Canadian  Bank  of  Commerce 
of  offices  in  Rio  de  Janeiro,  Brazil,  and  Port  of  Spain,  Trini- 
dad, can  be  contrasted  with  the  retirement  of  various  United 
States  banks  from  the  foreign  field,  and  the  closing  of  many 
of  their  foreign  branches.  To  the  Canadian  banking  organ- 
ization, schooled  in  the  business  of  branch  banking  by  many 
decades  of  experience  in  this  country,  the  establishment 
and  profitable  maintenance  of  offices  abroad  does  not  pre- 
sent the  same  difficulty  as  it  does  to  other  organizations 
less  fortunately  situated.  And  a  year  which  saw  an  Ameri- 
can foreign  bank.^Tvhose  business  in  South  America  was  a 
particularly  active  one,  calling  for  fresh  capital  from  share- 
holders and  assistance  from  other  banks,  and  which  saw 
the  failure  of  many  local  banks  abroad,  has  also  seen 
Canadian  banks  bring  their  year's  foreign  business  to  a  not 
unprofitab'e  conclusion. 

Natirrally,  foreign  deposits  and  loans  have  declined  more 
sharply  than  those  in  Canada,  because  the  countries  In 
which  the  deposits  are  received,  and  the  loans  made,  have 
in  general  gone  through  a  deflationary  process  more  drastic 
than  that  experienced  by  this  country. 

These  are  the  figures: 

Sept.  30.  1920  Sept.  .30,  1921      Decrease 

Deposits    $355,238,992     $295,574,501     $59,(;()4,491 

Current      Loans     and 

Discounts    202,590,184       151,489,8()1       51,100,32.3 

Call  and  Short  Loans..  186,962,960  183,290,756  3,672,204 
Foreign  deposits  have  decreased  a  little  over  16  per  cent., 
as  compared  with  a  decrease  in  Canada  of  about  7  per  cent, 
during  the  same  period.  The  decline  in  current  loans  and 
discounts  abroad  is  25  per  cent.,  the  decline  in  Canada  about 
12%  per  cent.  Call  and  short  loans  outside  of  Canada, 
which  represent  to  a  great  extent  the  Instantly  available 
cash  reserves  of  Canadian  banks,  remained  at  practically 
the  figures  of  September,  1920,  thus  reflecting  the  fact  that 
the  liquid  position  of  the  Canadian  banking  organization 
has  not  suffered  during  a  poor  year. 

Some  Developments  of  the  Year 

Reference  has  been  made  above  to  the  new  establish- 
ments of  the  Canadian  Bank  of  Commerce.  The  alliance 
between  the  Bank  of  Montreal  and  the  Colonial  Bank,  which 
was  mentioned  in  these  columns  last  year,  has  developed 
during  1921  Into  a  close  co-operation  between  the  two 
institutions. 

Because  new  countries  were  not  entered  during  1921.  It 
should  not  be  thought  that  little  development  was  made. 
The  progress  of  the  year  is  to  be  found  in  the  development 
of  existing  facilities,  and  the  increased  use  of  these  facilities 
made  by  Canadian  business 

The  year  has  been  one  of  kaleidoscopic  changes  in  the 
standing  of  foreign  firms,  and  the  provision  of  accurate  and 
up-to-date  credit  information  has  been  important  as  uever 
before.  The  innumerable  calls  made  on  the  banks  for  ser- 
vice in  this  respect  have  been  well  met.  This  furnishing  of 
credit  Information  is  a  true  banking  service,  and  all  Cana- 
dian firms  that  do  a  foreign  business  should  freely  avail 
themselves  of  it.     It  would  seem  almost  incredible  that  a 


shipment  should  ever  bo  made  before  the  shipper  wa«  In 
possession  of  a  satisfactory  credit  report  on  the  consignee, 
yet  such  cases  do  crop  up,  usually  in  the  form  of  small 
orders  sent  out,  with  sight  drafts  attached,  and  Instructions 
to  deliver  documents  only  on  payment.  This  procedure 
does  not  give  the  shipper  adequate  protection,  where  the 
consignee  is  an  Irresponsible  person,  since  his  refusal  to 
accept  delivery  may  result  In  the  goods  having  to  be  dis- 
posed of  at  a  loss. 

Two  recent  cases  which  have  come  to  the  writer's  atten- 
tion Illustrate  the  prime  necessity  of  credit  reports.  In 
one.  a  Canadian  company  received  an  order  from  a  Ann  in 
India.  The  ousiness  seemed  attractive.  The  report  we 
received  on  the  Indian  firm,  however,  read  as  follows: 
"Gambler  without  morality.  Avoid."  The  second  case  was 
one  in  which  an  individual  In  the  South  inserted  his  name 
in  a  Canadian  trade  publication,  expressing  himself  as 
desirous  of  buying  certain  Canadian  goods,  and  naming  as 
reference  the  Royal  Bank  of  Canada,  without  having  b^en 
authorized  to  do  so.  As  soon  as  the  matter  came  to  our 
attention,  we  were  able  to  advise  that  the  man  had  no 
means  or  standing,  and  that  a  shipment  to  him  should  never 
be  contemplated. 

Some  Difficulties  of  the  Year 

The  last  year  has  been  replete  with  instances  of  ship- 
ments refused,  of  difficulties  arising  under  Letters  of 
Credit,  of  documents  unaccepted  or  unpaid.  In  all  casea 
where  their  assistance  has  been  sought,  Canadian  banks 
ha^e  done  their  utmost  to  give  efficient  service  under  cir- 
cumstances which  often  were  trying  to  a  degree. 

It  may  not  be  out  of  place  to  note  here  the  scope  of  the 
business  conducted  by  Canadian  bank  branches  abroad 
They  are  not.  as  is  sometimes  thought,  limited  In  their 
activities  to  business  emanating  from  this  country,  but 
make  collections  and  establish  credits  on  behalf  of  cor- 
respondent banks  In  many  countries.  The  greatest  volume 
of  such  business,  of  course,  comes  from  the  United  States. 
All  this  business  is  strongly  competed  for,  and  a  good  8bar<> 
of  It  goes  to  our  own  Institutions  only  because  the  general 
services  they  render  are  on  a  par  with  those  provided  by 
the  overseas  connections  of  banks  of  other  nations. 

Foreign  Exchange 

The  above  remarks  apply  as  well  to  foreign  exchange.  In 
which  Canadian  bank  branches  abroad  do  an  Interesting 
business.  Incidently,  they  perform  pioneer  service  In 
familiarizing  people  with  Canadian  currency.  The  most 
practical  results  yet  obtained  from  this  are  seen  In  the 
British  West  Indies,  and  British  Guiana.  These  are  the 
places  with  which  Canada  hopes  to  develop  a  good  trade, 
and  it  is  satisfactory  to  note  that  wherever  else  Canadian 
exporters  may  be  forced  to  quote  In  sterling  or  1'  S.  doUars. 
they  do  not  have  to  do  so  as  far  as  these  I  '.onlea 

in    the    Caribbean    are    concerned.      Cauadia:.     ;i    are 

known  and  dealt  in,  and  Canadian  bank  branches  are  In  a 
position  to  quote  good  rates. 

The  larger  Canadian  banks  by  now  all  have  their  own 
establishments  in  New  York  and  London.  The  Bank  of 
Montreal.  The  Royal  Bank  of  Canada,  and  I.A  Bauque  Na- 
tionale  also  have  their  offices  In  Parts.  These  are  the  great 
excahnge  centres  of  the  world.  Thus,  through  their  own 
offices,  or  through  correspondents.  Canadian  hanks  are  able 
efficiently  to  conduct  their  foreign  exchange  hnsineas.    And 


44 


THE       MONETARY       TIMES 


Volume  68. 


the  business  is  of  no  small  proportions  for  a  country  of  this 
size.  In  the  Monetary  Times  Annual  of  last  year,  we  noted 
the  fact  that  Canadian  foreign  trade  per  capita  was  extreme- 
ly large,  and  was  in  fact  well  ahead  of  the  per  capita  foreign 
trade  done  either  by  the  United  Kingdom  or  the  United 
States.  This  still  holds  good.  Based  on  the  first  nine 
months  of  1921,  Canadian  foreign  trade  will  amount  to 
some  $182  per  capita  for  the  year.  The  figures  for  the 
United  Kingdom  and  the  United  States  are  $153  and  $68 
respectivel.t.  The  average  dec'.ine  in  value  of  the  trade  of 
the  three  countries  since  last  year  is  37  per  cent. 

Foreign  Trade  Depaitinent 

Through   the   medium   of  a   Foreign   Trade   Department, 


or  through  the  Foreign  department,  Canadian  banks  with 
close  overseas  connection  place  their  facilities  for  acquiring 
general  information  on  foreign  markets,  and  the  names  of 
importing  or  exporting  houses,  at  the  disposal  of  Canadian 
business.  The  managers  of  Canadian  bank  branches  abroad 
give  their  personal  attention  to  supplying  facts  and  names. 
They  have  co-operated  in  many  cases  with  our  Trade  Com- 
missioners in  their  work  of  forwarding  the  interests  of 
Canadian  trade.  The  banks  cannot  build  up  a  business  for 
anyone.  That  lies  with  the  manufacturer  or  exporter  him- 
self, fiut  banks  can  and  do  give  assistance  to  those  who 
need  it  in  their  work  of  gradually  cultivating  a  foreign 
market  for  Canadian  products. 


Movement  of  Bank  Capital  and  Reserve 

Small  Additions  to  Subscribed  Capital  During  Past 
Year — Paid-up  Capital  Has  Increased  and  Substantial 
Amounts   Have   Been   Added   to   Their   Reserve   Funds 


NIi>IETEEN-TWENTY-ONE  witnessed  a  further  expansion 
in  banking  in  Canada,  both  by  new  stock  subscrip- 
tions and  appropriations  to  reserve.  The  increase  in  paid- 
up  capital  was  about  $2,000,000,  while  reserve  advanced 
about  $5,000,000. 

Last  year  critics  of  the  Canadian  banks  were  discussing 
the  insufficiency  of  capital  employed  in  the  banking  business 
here,  and  comparative  figures  did  point  that  way,  but  the 
deflation  which  has  taken  place  in  the  past  twelve  months 
has  somewhat  weakened  those  arguments,  although  com- 
pared with  results  of  six  years  ago,  banking  capital  does 
seem  insufficient. 

In  1914,  the  ratio  of  capital  and  reserve  to  total  assets 
Was  about  15  per  cent.,  and  the  ratio  of  capita!  and  reserve 
to  total  deposits  was  about  21  per;  cent.  By  the  end  of 
1920  the  ratio  to  total  assets  was  only  a  little  more  than  8 
per  cent.,- and  the  ratio  to  total  deposits  slightly  above  11 
per  cent. 

Of  course,  the  changes  which  took  place  in  the  business 
world  last  year,  affected  the  banks'  position  in  this  regard, 
with  the  assets  dropped  sharply,  as  against  a  moderate 
increase  in  capital  and  reserves.  Deposits  also  dropped 
considerab'y,  and  the  ratio  now  is  approximately  13  per 
cent.  The  following  table  shows  the  relation  of  capital  and 
reserves  to  assets  in  recent  years. 

Assets.  Cap.  &  Res.  Ratio. 

1918  $2,638,839,732         $217,712,629  8.1% 

1919    2,967,598,848           241,152,863  8.1% 

1920    3,155,601,568           257,682,757  8.1% 

1921    2,766,743,521           264,331,734  9.5% 

The  above  figures  are  as  at  the  latter  part  of  each  year 

mentioned. 

The  ratio  of  capital  and  reserve  to  deposits,  while  having 
fallen  largely  in  recent  years,  still  stands  high  as  compared 
with  other  of  the  world's  largest  banks.  Take  three  British 
instances.  The  ratio  shown  by  Lloyds  Bank  and  Barclays 
Bank  is  about  7  per  cent.,  while  that  of  the  London  Joint 
City  and  Midland  is  about  6  per  cent. 

Subscriptions  Paid 

There  have  been  no  new  stock  issues  during  the  past 
year,  the  main  business  of  the  banks  being  to  clean  up  out- 
standing subscriptions,  with  the  result  that  the  subscribed 
and  paid  up  capitals  are  nearly  on  a  level. 

One  thing  worthy  of  mention  is  that  the  authorized 
capital,  which  had  not  changed  since  the  middle  of  1919, 
was  increased  by  $2,000,000,  this  being  brought  aboiit  by 
the  action  of  the  Bank  of  Hamilton.  "The  authorized 
capital  of  a!l  our  Canadian  banks  combined,  is  many 
millions  above  the  subscribed  amount.     At  present  it  does 


not  seem  as  though  there  is  need  tor  increase  in 
authorizations. 

It  may  be  that  there  may  be  further  substantial  additions 
to  capital,  having  in  view  the  plans  of  the  Great  West  Bank. 
This  new  institution  has  an  authorized  capital  of  $5,000,000, 
and  wants  to  raise  about  $2,000,000  at  the  present  time. 

Under  the  Bank  Act,  a  new  bank  wishing  to  start 
business  must  have  within  a  year  of  incorporation  capital 
subscribed  to  the  extent  of  $500,000,  and  not  less  than 
$250,000  paid-up  and  deposited  with  the  minister  of  finance. 
The  deposit  will  be  returned  after  the  whole  enterprise  has 
been  investigated  and  approved. 

The  Great  West  Bank  was  unable  to  meet  those  require- 
ments, the  delay  being  due  in  part  to  general  economic 
conditions  in  the  west,  and  in  part  to  difficulties  between 
the  promoters  and  those  who  were  backing  the  scheme. 

However,  the  bank  secured  from  parliament  an  extension 
of  time  for  preliminary  work  until  July  1,  1922.  Those  who 
are  directly  interested,  anticipate  that  all  requirements 
will  be  complied  with  before  that  time.  By  September  it 
was  reported  that  $3,000,000  of  the  stock  had  been  sold  in 
Saskatchewan  and  Manitoba  and  one-third  of  the  authorized 
paid-up  capital  had  been  subscribed.  Since  that  date 
further  progress. has  been  made. 

Individual  Progress 

The  total  increase  in  subscribed  capital  from  October, 
1919,  to  the  same  month  in  1920,  was  $10,148,800,  while  in 
the  same  period  paid-up.  capital  and  reserve  advanced 
$9,594,125  and  $6,935,769,  respectively.  The  1921  results 
indicate  that  there  was  not  nearly  so  much  activity, 
although  there  were  increases.  The  following  details  are 
interesting:  — 

Subscribed         Paid-Up  Reserve 

Nationale    $ $-...". $    100,000 

Merchants    300,900  544,030  1,050,000 

Provinciale    76,621  300,000 

Union     -,.-  400,000 

Royal    406,500  767,210  1,950,610 

Hamilton    34,800  110,230  205,115 

Standard    500,000  500,000  448,499 

Hochelaga    100,000 

Home    249  50,000 

Sterling 3,218  50,000 


$4,654,224 


$1,242,200         $2,001,468 
Three  Years  of  Development 

In  three  years  the  increase  in  authorized  and  subscribed 
capital  has  been  rather  large,  and  as  already  pointed  out 


January   6,   1922, 


THE      MONETARY      TIMES 


46 


the  amount  authorized  Is  sufficient  to  allow  further  aub- 

scriptions  of  many  millions.  The  following  table,  which 
traces  the  monthly  movement  since  January,  1919,  is 
illustrative: — 

Capital  Capital 

1919—                                                  Authorized  Subscribed 

January    $179,000,000  $110,492,200 

February 182,075,000  111,335,200 

March    „ „ 189,075,000  112,401,700 

April    „,.. .'. 194,075,000  114,927,400 

May , „.; 189,075,000  115,784,700 

June    . „ „ 189,075,000  116,3(10,000 

July  194,075,000  116,599,100 

AuKiiffI    -                                         194,075,000  116,665,200 

September    ^ 194,075,000  117,602,800 

October    197,075,000  118,131,300 

Noveml)er '. 197,075,000  119,522,300 

December    197,075,000  119,522,300 

1920— 

January  $197,075,000  $119,522,300 

February  197,075,000  119,522,300 

March  197,075,000  119,522,300 

April   197,075,000  119,522,300 

May 197,075,000  121,522,300 

June    197,075,000  122,855,100 

July  197,075,000  127,302,800 

August  197,075,000  127,901,400 

September    197,075,000  128,183,500 

October    197,075,000  128,280.100 

November   197,075,000  128,719,600 

December 197,075,000  128,742,093 

1921— 

January  $197,075,000  $129,045,300 

February  197,075,000  129,116,800 

March  197,075,000  129,138,700 

April  197,075,000  129,468,700 

May   : 197,075,000  129,522,300 

Juno    197.075,000  129.522.300 

July  199,075,000  129.522,300 

August   199,075.000  129,522,300 

September    199,075,000  129,522,300 

October     .-. 199,075,000  129,522,300 

Reserves  Show  Rapid  Increase 

In    studying    the    development    of    paid-up  capital    and 


reserves  it  la  Interesting  to  note  how  reMnres  bare  kept 
ahead  all  the  time.    The  foUowins  are  the  Ogurea: 


1919— 
January 
February 
March  ... 
April 
May 
June 
July 


Capital 


Rest  or 


..  110,643,539  U0,B7'J,:;U 

_.  11,722,628  117,4.13,:t22 

.   113,766,272  119,: 

,..   114,238,013  121, 

,..  115,423,.327  122,1;:4,;:01 

..  115,721,029  122,230,372 

August  115,834,923  122,273,225 

September    117,050,239  123,041,750 

October    „  117,675,302  123,477,561 

November  119,162,137  124,710,890 

December   ...                      119,199.441  124,712,670 

1920— 

January                             .•$119,226,365  $124,724,985 

January    $128,460,163  $133,343,590 

March    119,252.969  124,925,000 

April    „.. „ 119,266,664  126,475,000 

May    121,266,885  128,575,000 

June   _  122,400,044  128.675.000 

July    126,051,138  lJ0,027,965 

August  126,522,615  130,182,660 

September    _ 126.927,040  130.325,640 

October    127,269.427  130.413,330 

November  127.913,611  •  132,782.190 

December   128,06«,769  133,048,505 

1921— 

Jnauary  „ $128,460,163  $133,343,590 

February    128,582,713  133,558,807 

March    _ 128,720,031  133,623,339 

April    129.179,531  134.853.053 

May    „ _ 129.249,661  134.953,044 

June    129,259,274  135,059.325 

July    129,263,949  135,062.366 

August    129.267,088  135,064,646 

September    .                        129,268,517  135.065.636 

October   129.271,075  135,067.554 

It  is  the  desire  of  all  good  bankers  to  build  up  a  reserve 
or  rest  fund  to  a  substantial  figure,  usually  as  great  as  the 
paid-up  capital.  While  some  of  our  banks  have  not  been 
able  to  quite  reach  their  aim,  a  number  have  reaerrea  con- 
siderably in  excess  of  capital.  Thus  we  find  the  total 
reserves  about  105  per  cent,  of  capital. 


243,9rAin 

$243,951,350 
$161,803,753 
244.177.969 
245.741.664 
249,841,88S 
251.075.044 
256,079.103 

.,rr    -..r    .,-5 
-) 


101,110,2(4 

$161,803,753 

1 '•.2. 14 1.520 

"■J 

-» 

5 

.<a 

164,:>26..il5 

in4.3:?1.734 

'3 

-     -9 


GRKAT   WEST   BANK    NOT   YET    STARTED. 


Organizution   Work   Has   Met   Willi    DinUultics, 

But  liarKo  Amount  of  Capital  I.s   Rc- 

I)ortc<l   US  Subscribed 


THE  Great  West  Bank  of  Canada,  which  was  incorporated 
by  Act  of  Parliament  in  1920,  has  not  yet  commenced 
operations.  Its  authorized  capital  was  $5,000,000,  and  the 
provisional  board  of  directors  was  composed  of  Saskatche- 
wan men,  including  some  farmers.  The  head  office  was 
located  in  Regina.  A  prospectus,  issued  in  August,  1920, 
offered  the  stock,  par  value  $100,  at  $125  per  share,  a  pay- 
ment of  $35  per  share  being  required  on  application,  and 
the  balance  as  follows:  $15  in  twelve  months;  $25  in  nine 
months,  and  $25  in  twelve  months. 

During  the  first  three  months  of  1921  a  campaign  for  the 
sale  of  the  stock  was  conducted  throughout  the  West.  The 
Imperial  Financial  Corporation,  which  at  flrst  had  charge 
of  the  offering,  was  taken  over  by  the  Mutual  Bond  and 
Securities  Corporation,  and  by  February.  1921.  the  matter 
had  been  given  into  the  hands  of  the  General  Bond  Cor- 
poration, Ltd.,  by  whom  the  offering  was  being  made.  The 
president  of  this  corporation  was  W.  A.  Lamport,  barrister, 
of  Toronto;  W.  R.  Phillips,  director,  of  Regina,  and  J.  K. 
McLennan,  of  Regina,  secretary-treasurer.  A  brokerage 
of  $5  per  share  was  offered  to  those  who  subscribed  up  to 


March  15;  this  brokerage  was  evidently  to  be  repaid  when 
the  bank  commenced  business.  The  cost  of  promotion  waa 
estimated  at  $7.50  per  share,  which  would  leare  $12.50  as 
reserve. 

The  sale  of  stock  did  not  proceed  well,  due  in  part  to 
unfavorable  conditions  throughout  the  West.  As  the  time 
for  securing  the  $50,000  necessary  In  subscriptions  to  start 
business  expired  on  July  1,  application  was  made  for  an 
extension  of  one  year,  and  this  was  granted  by  special  Act 
of  Parliament. 

The  project  also  suffered  two  blows  in  the  spring.  In  the 
death  of  W.  R.  Phillips,  one  of  the  chief  promoters,  and 
the  sentencing  to  gaol  of  R.  J.  Potts,  who  had  been  engaged 
as  organizer,  for  forging  Phillips'  name  to  a  check  on 
account  of  salary  due  to  himself. 

Better  progress  was  made  during  the  summer,  however, 
and  early  in  July  a  suteraent  was  made  by  Albert  Ross,  of 
the  General  Bond  Corporation,  to  the  effect  that  tlie>h«ad 
office  in  Regina  would  be  opened  in  a  few  months.  Abont 
August  1.  Albert  Banniger,  the  chief  promoter.  sUted  that 
$3,000,000  of  the  stock  had  been  sold  in  Saskatchewan  and 
Alberta.  He  also  said  that  a  general  meeting  would  be 
held  about  November  for  the  election  of  permanent  direc- 
tors, and  that  the  head  office  would  be  opjened  by  the  new 
year,  and  three  or  tour  branchea  a  little  later. 

No  report  of  a  genera',  meetins  has  as  yet  been  recelTed. 


46 


THE      MONETARY      TIMES 


Volume  68. 


Legal  Decisions  Affecting  Banking 

Paige  Motor  Case — Notice  of  Assignment  of  Cladm — Robidoux  vs. 
Royal  Bank — Curley  vs.  Briggs — Some  of  Banking  Points  on  Which 
Canadian     Courts     Have     Declared     Themselves     During     Past     Year 


IN   cases   relating   to   banking   during   the  past  year,   Cana- 
dian  Courts   have   been   called   on   to   decide   questions   of 
banking  practice  rather  than  to  Interpret  sections  of  the 
Bank  Act.  Some  of  the  more  outstanding  cases  are  reviewed 
herein. 

Paige  Motors  Case. 

A  judgment  of  special  interest  to  banking  and  financial 
circles  was  rendered  in  Montreal  by  the  Court  of  Appeal, 
when  an  appeal  of  the  Canadian  Bank  of  Commerce  was 
maintained  from  a  judgment  of  the  Superior  Count,  which, 
in  applying  Section  96  of  the  Winding-Up  Act,  voided  a  con- 
veyance (for  consideration)  of  $7,000  made  to  the  appellant 
bank  on  behalf  of  the  Paige  Motors  of  Montreal,  Limited, 
when  the  company  was  unable  to  meet  its  engagements,  even 
though  the  bank  accepted  the  amount  in  good  faith  and  with- 
out knowledge  at  the  time  of  the  company's  insolvency. 

The  action  was  taken  by  A.  Burnett  in  his  quality  of 
liquidator  of  Paige  Motors,  of  Montreal,  Limited,  to  compel 
the  Bank  of  Commerce  to  refund  $7,000  deposited  with  the 
bank  in  cash,  cheque  and  notes  on  September  3,  1918,  on  be- 
half of  the  motor  company. 

The  company  was  incorporated  by  letters  patent  of  Quebec 
in  November,  1917.  In  the  following  June  an  order-in-council, 
issued  under  the  War  Measures  Act,  prohibited  the  inport- 
ation  of  autmobiles  valued  at  $1,200  and  upwards.  Among 
these  were  the  Paige  Motors,  and  on  August  28  a  meeting  of 
the  share-holders  was  called  to  consider  the  financial  position 
of  the  company. 

The  meeting  was  adjourned  until  September  3,  when  it 
was  resolved  to  voluntarily  wind  up  the  affairs  of  the  com- 
pany. 

Before  this,  on  August  28,  1918,  R  .A.  Kelly,  president  of 
the  company,  had  sold  two  Paige,  automobiles  for  $7,000, 
payable  $1,000  in  cash,  $1,000  by  cheque,  dated  September 
3,  i918,  and  the  balance  by  two  notes  of  $2,500  each,  payable 
October  12  rnd  28  respectively.  On  September  3,  Mr.  Kelly 
deposited  with  the  Bank  of  Commerce  $1,000  and  the  cheque 
and  notes  for  the  balance  of  the  $7,000,  and  asked  in  con- 
sideration for  an  advance — the  company  then,  it  was  said, 
had  a  debt  balance  of  $4,059 — of  $2,876  to  pay  the  duty  on 
the  two  cars  just  sold,  and  which  were  in  bond,  and  $55  for 
a  spare  tire  or  wheel.  This  advance  was  made.  In  the  mean- 
time, on  September  3,  as  indicated  above,  it  had  been 
decided  by  the  share-holders  of  the  Paige  Company  that  its 
affairs  sTiould  be  voluntarily  wound  up. 

Mr.  Justice  Martin,  in  pronouncing  judgment  of  the  major- 
ity of  th  Court  of  Appeal,  reversing  the  ruling  of  the  court 
of  first  instance,  said  he  v;as  not  able  to  accept  the  reasoning 
of  the  trial  judge,  and  did  not  think  the  transactions  of  the 
3rd  of  September  were  a  conveyance  of  personal  property 
for  a  consideration  made  by  a  company  unable  to  meet  its 
engagements.  The  transactions  were  in  reality  simply  a 
discount  by  the  bank  of  commercial  paper  and  the  deposit 
with  the  bank  by  the  company  of  the  proceeds  of  such'  dis- 
count and  of  two  other  items  of  $1,000  eacii,  one  in  cash  and 
one  represented  by  the  cheque  of  Faivweathers,  Limited. 
Surely  that  was  not  a  fraudulent  conveyance  within  the 
scope  and  purport  of  Article  96  of  the  Winding-Up  Act. 

In  His  Lordship's  opinion.  Section  99  applied  to  the  case 
undfer  consideration  and  the  liquidator  in  order  to  recover 
back  the  pmount  paid  to  the  bank  of  the  3rd  of  September, 
must  establish  that  the  bank  then  knew  that  the  company 
was  unable  to  meet  its  engagements  in  full  or  had  probable 
cause  for  believing  such  condition  to  exist. 

His  Lordship  said  in  conclusion  that  he  could  not  subscribe 
to  the  doctrine  that  discounts  by  a  bank  of  a  customer's 
trade  paper  were  conveyances  in  contemplation  of  Section 
96  of  the  Winding-Up  Act,  and  as  there  was  no  evidence  of 
record  of  knowledge  by  the  bank  of  the  company's  insolvency, 


he  had  reached  the  conclusion  that  the  transactions  of  the 
3rd  of  September  were  not  void  and  that  the  respondent's 
action  should  be  dismissed  with  costs 

Assignment  of  Claim. 

In  an-ther  c;  se,  the  New  Brunswick  Supreme  Court 
ruled  as  to  what  constitutes  notice  of  assignment  of  claim 
to  a  Bank. 

On  May  8,  1912,  the  Hibbard  Cor.ipany,  Limited,  entered 
into  a  contract  with  the  St.  John  and  Quebec  Rai.way  Com- 
pany for  the  construction  of  a  line  of  railway  between  Fred- 
eiicton  and  Woodstock  on  the  western  side  of  the  River 
St.  John.  In  the  latter  part  of  August,  1914,  the  company 
was  unable  to  pay  the  July  estimates  and  no  funds  were 
forthcoming  to  meet  the  contractor's  obligations.  The  Hon. 
George  J.  Clarke,  premiei'  of  the  province,  then  went  to 
Montreal  and  negotiated  with  the  Hibbard  Company  to  con- 
tinue the  work  of  construction.  He  represented  that  the 
pr  vince  would  hand  over  to  the  contractors  ben  s  o  ' 
province  or  bonds  of  the  railway  company  guaranteed  by  the 
province,  tearing  interest  at  the  rate  of  4%  per  cent.,  less 
a  certain  drawback  of  10  per  cent,  to  be  paid  over  when  the 
work  was  commpleted,  on  the  understanding  that  all  esti- 
mates were  to  be  approved  by  the  provincial  engineer. 

In  the  course  of  the  negotiations  it  was  pointed  out  to 
Mr.  Clarke  that  such  arrangements  would  be  impossible 
unless  the  company  was  able  to  finance  upon  the  security 
of  the  bonds,  and  Mr.  Clarke  consequently  gave  a  letter  to 
the  Bank  of  British  North  America  setting  forth  what  the' 
province  would  undertake  to  do,  and  the  Bank  of  British 
North  America  consented  to  supply  the  Hibbard  Company 
with  the  necessary  funds  from  month  to  month  to  carry  on 
its  work.  The  work  on  the  railway  went  on  until  it  was 
completed  in  October,  1914,  all  payments  that  were  made 
being  made  to  the  bank  in  bonds  of  the  railway  company 
guaranteed  by  the  province.  On  January  16,  1916,  the  Hib- 
bard Company  gave  an  absolute  power  of  attorney  bo  a  Mr. 
Gal  to  act  for  it  in  mrking  a  full  and  final  settlement  with 
the  railway  company,  and  a  few  days  later  Mr.  Gall  carhe 
to  a  settlement  with  the  company,  conceding  payment  of 
liabilities  that  the  company  had  previously  repudiated,  and 
diverting  a  considerable  amount  of  money,  over  $17,000,  to 
the  Imperial  Bank  upon  his  own  account,  leaving  a  balance 
of  a  little  less  than  $5,000  payable  to  the  Hibbard  Company, 
and  for  which  amount  the  railway's  cheque  was  given. 

The  contention  of  the  bank  was  that  the  government 
and  the  railway  company  remained  liable  to  the  bank  for 
the  bale' nee  of  the  advances  made  to  secure  the  work, 
amounting  to  a  sum  of  $32,899,  with  interest;  that  of  this 
amount  there  had  only  been  paid  the  sum  of  $4,902,  the  bal- 
ance arrived  at  in  the  settlement  by  Mr.  Gall  with  the  rail- 
way company  in  January,  1916. 

Mr  Justice  Hazcn  in  his  judgment  says:  "Chandler,  J., 
having  stated  in  his  judgment  as  above  that  he  considered 
that  the  assignment  of  the  amount  due  to  the  Hibbard  Com- 
pany under  their  contract  with  the  railway  company  to  the 
Bank  of  British  North  America  was  a  good  and  valid  assign- 
ment, held  that  the  St.  John  and  Quebec  Railway  Company 
had  notice  of  the  assignment  of  the  claim  of  the  Hibbard 
Company  to  the  Bank  of  British  North  America,  and  that 
such  notice  was  given  by  the  resolution  passed  by  the  Hib- 
bard Company  authorizing  A.  D.  Gall  to  settle  with  the 
railway  company  and  the  government  of  New  Brunswick. 

"In  my  opinion,  therefore,  the  appeal  should  be  dis- 
missed with  costs,  and,  in  compliance  with  the  judgment  of 
Chandler,  J.,  the  matter  should  be  referred  to  a  Master  of 
the  Supreme  Court  to  take  an  account  of  the  amount  due 
by  the  Hibbard  Company  to  the  Bank  of  British  North 
America  for  loans  and  advances  in  connection  with  the  con- 


January  6,   1922. 


THE      MONETARY      TIMES 


47 


The  Royal  Bank  of  Canada 


INCORPORATED 


CAPITAL  AUTHORIZED  $25,000,000 
CAPITAL  PAID-UP  $20,400,000 


1869 


RESERVE  FUNDS 
TOTAL    ASSETS 


$21,000,000 
$500,000,000 


HEAD  OFFICE 


MONTREAL 


BOARD    OF     DIRECTORS 

SIR   HERBKRT   S.    HOLT,   President      E.  L.  PEASE,  Vice-President 


JAS.   RitDMOND 

n.   R.   CROWE 

I).   K.   ELLIOTT 

HON.   W.    H.   THORNE 

HUGH   PATON 


A.  J.  BROWN,  K.C. 
W.   J.   SHEPPARD 
C.  S.  WILCOX 
A.    E.    DYMENT 
C.   E.  NEILL 


SIR   MORTIMER   B.    DAVIS  W.  H.   McWILLIAMS 

G.  H.  DUGGAN  CAPT.    WM.    ROBINSON 

C.  C.  BLACKADAR  A.   McTAVISH  CAMPBELL 

JOHN   T.    ROSS  ROBERT  ADAIR 

R.   MacD.   PATERSON  T.  SHERMAN  ROGERS.  K.C 

E.    L.   PEASE,   Managing   Director     C.  E.  NEILL,  General  Manager  M.  W.  WILSON.  Supt.  of  Branchea 


708  Branches  In  Canada,  Newfoundland,  West  Indies,   &c. 

BRANCHES    IN    CANADA  AND    NEWFOUNDLAND 

Alberta 41  Ontario  195 

British  Columbia 55  Prince  Edward  Island  .    10 

Manitoba   38  Quebec  63 

New  Brunswick 25  Saskatchewan  92 

Nova  Scotia  72  Newfoundland    8 


Crihii— 54  Branches.  Havana.  Santiago,  etc. 
iNirtii  Itico — San  Juan,  Mayasruez.  ronce. 
Itnmlnlonn   nepiiblic— Santo  Domlng-o,  etc. 

(I'l  liranclies). 
(;iiii(l('l(Mi|ir— liasselerre  and  rolntc-a-ntrc. 
Miirlinlqiir — Fort  (1e  France. 
Haiti— rort  au  Prince,  etc.   (3  branches). 


BRANCHES    IN   WEST    INDIES 

Anllnuo — St.   John's. 

Ilahamn.s— Nassau. 

ilnrbniliiK — itrldgctown   and   Spelffhtstown. 

Dominica— Iloscau. 

Crcnnila -St.    Oeor^es. 

.Inmiilcii— Kingston,  etc.   (4  branches). 


Monlsermt— I'l.vmouth. 
N>v|s — Charlcstown. 
SI.   KltLs— Basseterre. 
St.   l.iirla— Castries 
Tnhago — Scarborough. 
Trinidad— Port  of  Spain    etc. 


«  brancbM). 


BRANCHES    IN    CENTRAL   AND  SOUTH  AMERICA 


.Vrflcntlne— niiono.s  Aires.    (2  branches). 
llrlllNh   Honduras— Ilellzc. 


Ilru/ll— llln  de  Janeiro,  Santos  and   Sao  Paulo.       I  ruguay— Montevideo. 
Culomhla- narranqullla.  I'.osia  RIra — San  Jose. 


Ilrlllsh   Guiana— Georgetown,    New   Amsterdam    and    no-^e   Hall. 


Venr/uFin — Caracas,   Cludad    Bolivar  and   Mararalbo 


SPAIN — Barcelona,   Plaza  de  Cataluna,  6 


GREAT    BRITAIN 

LONDON  -      -  -  Princes  St..  E.G. 

T.  R.  WHITLEY,  Mgr.  JAS.  MACKIE,  Joint  Mgr. 


UNITED    STATES 

NEW  YORK  -  68  William  St. 

F.  T.  WALKER  and  J.  A.  BEATSON.  Agents. 


FRENCH    AUXILIARY: 
THE    ROYAL    BANK    OF    CANADA,    (FRANCE).  PARIS— 28  Rue  du  Quatre-Septembre 


PRINCIPAL  CORRESPONDENTS: 


(IMKAT  IIIIITAIN— Bank  of  Isugland. 

London  Count.v  Wcstinlnsler  and  Parr's   Bank, 

Ltd. 
Bank  or  Scotland. 

London  Joint  City  and  Midland  Bank,  Ltd. 
iMTKn  .STATES— New  York— Cha.'Jo  National  Bank. 

"  AnuMlcan  Kxchaiige  National  Bank 

Chemical   National   Bank. 
"  Bank  of  the   Manhattan  Co. 

Boston— National  Sliawnnit  Bank. 

First  National  Bank. 
Chicago— Continental    &    Commercial    National 

Bank. 
Philadelphia— Philadelphia  National  Bank. 
.Minneapolis— First   National   Bank. 


IJNITF.D  STATES— J?  1 
Bur 


'— Flrat  National  Bank. 
:  <ctur«rs     k     Traders     NaUoiul 


I 


FBANOE 
SPAIN 

ITALY 

INDIA.  CHINA 

and  JAPAN 

AISTBALASIA 


New  i.riediis — Canal  Commercial  Trust  ft  Ssr. 

Bank. 

Coin!-"'''       \-itli*nal     il't-irAmple. 

Lon  *ier  k  Parr's  Foreun 


I 


Lon 


W  «.^« 


I'.rr's  ror«i(ii 


le. 


Bai' 

Cruli;..   ... 
Banco  (tt  .Napoli. 

Ilongkonir   and   Shanithai    Bankmr   CorporsOoiL 
Baitk  of  New  South  Wales. 


48 


THE3      MONETARY      TIMES 


Volume  68. 


tract  between  the  Hibbafd  Company  and  the  St.  John  and 
Quebec  Railway  Company,  dated  May  8,  1912,  and  that  an 
account  should  also  be  taken  of  the  amount  due  from  the 
St.  John  and  Quebec  Railway  Company  to  the  Hibbard  Com- 
pany under  the  contract  above  mentioned." 

Collecting  Interest  in  New  York  Funds. 

Canadian  holders  of  securities,  the  interest  on  which  is 
payable  in  New  York  as  well  as  in  Canada,  a  feature  to 
which  little  importance  was  previously  attached,  have  found 
themselves  able  to  reap  an  unexpected  profit  since  New  York 
exchange  went  to  a  premium.  The  large  am.ount  of  bonds 
recently  sold  in  the  United  States  have  also  had  this  feature, 
but  among  the  government  war  loans  there  is  only  one 
issue,  the  5's  due  1937,  so  payable.  The  right  of  the  Can- 
adian holder  to  demand  payment  in  New  York  funds  has 
been  unquestioned  by  most  debtors,  but  the  Dominion  finance 
department  last  year  made  an  effort  to  prevent  Canadian 
holders  of  the  1937  bonds  from  so  doing. 

At  times,  however,  disputes  will  arise  on  this  point.  During 
the  year,  the  Quebec  Courts  Maintained  five  actions  against 
the  municipality  of  Pointe-aux-Trembles,  which  was  con- 
demned in  each  iristance  to  pay  to  the  claiment  the  amount 
found  to  be  due  on  the  interest  coupons  of  the  town's  deben- 
tures. In  two  instances,  the  Court  upheld  the  principle 
that  a  claiment  who  has  the  option  of  collecting  the  debt  in 
the  United  States  may  on  exercising  that  option  demand 
payment  to  the  equivalent  of  the  face  value  of  the  interest 
coupon  n  the  currency  of  the  country  where  the  amount  is 
collectable. 

This  option  v/as  reserved  to  Achille  Raymond  and 
Emile  Vaillancourt.  Their  respective  claims  were  for  $240 
and  $660,  arid  as  they  exercised  their  right  to  co.lect  the 
interest  at  the  National  Park  Bank,  New  York  City,  they 
demanded  ten  per  cent,  additional,  for  exchange.  The 
municipality  contested  the  demand  and  pleaded  that  in  any 
event  the  plaintiff  could  claim,  only  the  amount  due  on  the 
coupons  in  Canadian  currency.  Judge  Archer  found  against 
this  plea,  and  judgment  therefore  went  against  the  munici- 
pality for  $264  in  the  case  of  Raymond  and  $660  in  the  case 
of  Vaillrncourt,  with  interest  as  from  the  date  the  co-i-ans 
matured  on  November  1  last,  and  the  costs  of  the  action. 

Robidoux  V.  The  Royal  Bank. 

In  an  appeal  to  the  Quebce  Court  of  King's  Bench  in  the 
case  of  Robidoux  v.  The  Royal  Bank  it  was  held  that  one 
who  gives  a  power  of  attorney  to  col  ect  funds  to  a 
solicitor  who  deposits  the  funds  collected  in  his  own  bank 
and  draws  the  money  out  later  for  his  own  use,  cannot  re- 
cover as  against  the  bank,  there  being  no  privity  of  contract 
between  the  giver  of  such  power  and  the  bank. 

In  his  decision  Justice  Pelletier  says: — 

"It  is  admitted  by  all  parties  that  the  advocate,  A.  D., 
who  had  made  the  deposit  at  the  bank,  could  withdraw  the 
money  in  the  same  Planner  as  that  in  which  he  deposited  it, 
that  is  to  say,  by  cheques  conforming  to  the  deposit  slip  and 
the  entries  in  the  bank  books.  But  the  appellant  says,  with 
much  plausibility  at  first  sight,  that  'when  the  bank  received 
this  deposit  made  by  my  solicitor  as  my  attorney,  it  was  at 
the_  same  time  notified  of  the  terms  and  of  the  extent  and 
limitation  of  the  powers  my  mandatary  had.'  This  contention 
is  we'I  founded  n  fact.  When  A.  D.  deposited  the  cheque  the 
respondent  bank  received  at  the  same  time,  and  kept  in  its 
custody,  the  appellant's  power  of  attorney.  The  decision  of 
this  case  rests  then  entirely,  in  m.y  opinion,  upon  the  inter- 
pretation that  should  be  given  to  the  terms  of  this  power  of 
attorney,  the  text  of  which  is  reproduced  above,  and  which 
was  signed  by  the  appellanT  in  the  presence  of  an  agent  of 
the  respondent,  Harwood.  If,  by  this  power  of  attorney,  the 
mandate  of  A.  D.  was  at  an  end  after  the  deposit  was  made, 
the  bank  was  not  justified  in  permitting  A.  D.  to  withdraw 
as  attorney,  by  cheque  payable  to  his  own  order,  moneys 
which  did  not  belong  to  him.  But  the  power  of  attorney, 
which,  at  first  sight,  I  would  believe  conclusive  in  favor  of 
the  contentions  of  the  appellant,  is  susceptible  of  two  inter- 
pretations. 

"The  sound  doctrine,  I  believe,  in  the  matter  of  mandate, 
ta  that  if  a  power  of  attorney  is  incomplete,  or  susceptible 
of  two  interpretations,  it  is  the  person  giving  the  mandate 


who  should  suffer ;  it  is  for  him  to  draw  his  power  of  attorney 
in  such  a  form  that  his  agent  cannot  abuse  it,  and  if  he 
does  rot  take  precautions  sufficient  to  protect  himself,  the 
benefit  of  the  doubt  should  be  given  to  tiie  third  party,  who 
acts  with  evident  good  faith.  In  view  of  what  1  have  said, 
I  do  not  believe  that  there  was  any  privity  of  contract  be- 
tween the  appellant  and  respondent.  I  am  sorry  for  the 
unfortunate  woman  who  suffers  from  all  this  to  be  obliged 
to  arrive  at  this  conclusion,  but  I  do  not  see  how  it  is  possible 
to  do  otherwise." 

Curley  v.  Briggs. 

On  appeal  from  the  tiial  judgment  in  the  case  of  Curey 
vs.  Brisfgs,  the  Saskatchewan  Court  held  according  to  the 
Bills  of  Exchange  Act  that  from  the  date  that  the  bank 
receives  notce  of  the  death  of  the  drawer  of  a  cheque,  pre 
sentment  for  payment  is  dispensed  with  because  nothing 
can  be  gained  by  such  presentment,  the  bank's  authority  to 
pay  the  cheque  being  terminated  by  notice  of  the  death 
and  an  action  brought  against  the  administrator  for  the 
amount  due  should  be  framed  as  for  money  advanced  to  the 
deceased,  the  right  of  the  payee  being  subject  to  the  condi- 
tions under  which  the  payee  received  the  cheque. 

The  rction  was  brought  against  Charles  Briggs,  ad- 
ministrator of  the  estate  of  Thos.  A.  Drury,  deceased,  for 
five  cheques  given  by  Drury  in  his  lifetime  to  Curley.  The 
defences  raised  were:  (1)  That  the  cheques  were  given  in 
payment  of  a  gambling  debt,  and  (2)  that  there  v.as  no  evi- 
dence of  presentment  for  payment  or  dishonor. 

Elwood,  J.  A.,  in  his  written  judgment,  says  in  part, 
"So  far  as  the  first  defence  is  concerned,  that  in  my  opinion 
is  disposed  of  by  the  finding  of  the  trial  judge  that  the 
cheques  were  not  given  for  a  gambling  debt. 

"So  far  as  the  second  defence  is  concerned,  sec.  107  of 
the  Bills  of  Exchange  Act  is  in  part  as  follows:  'Notice  of 
dishonor  is  dispensed  with  as  regards  the  drawer  where  .  .  . 
(d)  the  drawee  or  acceptor  is,  as  between  himself  and  the 
drav/er,  under  no  obligation  to  accept  or  pay  the  bill;  (e) 
the  drawer  has  countermanded  payment.' 

"Section  167  of  the  BiPs  of  Exchange  Act  in  part  is  as 
follows;  'The  duty  and  authority  of  a  bank  to  pay  a  cheque 

drawn  on  it  by  'its  customer    are  determined    by 

(b)   notice  of  the  customer's  death.' 

"I  am  of  the  opin'on  that  the  effect  of  sec.  167  is,  that 
from  the  date  of  the  death  of  the  drawer  of  the  cheque,  or 
at  any  rate  from  the  date  that  the  bank  would  receive  notice 
of  the  I'eath,  presentment  for  payment  would  be  dispensed 
with,  because  nothing  could  be  gained  by  such  presentment. 
Notice  of  the  death,  in  effect,  countermands  the  right  of  the 
bank  to  ■  "v  "e  cheque.  Notice  of  dishonour  is  also  dis- 
pcn-ed  with  under  sec.  107,  because  from  the  notice  of  the 
death  the  bark  is,  as  betv/een  itself  and  the  drawer,  under 
no  obligation  to  pay  the  cheque;  in  fact,  it  is  not  only  under 
no  obligation,  but  its  authority  to  pay  -the  cheque  is  deter- 
mined. 

"Tf  I  am  corrrect  in  the  conclusions  I  have  reached  above, 
then  it  was  not  necessary  in  this  case  for  the  plaintiff  to 
allege  either  presentment  or  notice  of  dishonour." 


ZINC  AND  LEAD  PRODUCTION 


It  is  reported  that  the  Consolidated  Smelting  Co.  is 
doing  well  in  the  way  of  metal  shipments..  Zinc  shipments 
have  been  particularly  heavy,  and  the  company  is  greatly 
favored  by  low  ocean  rates  in  getting  its  products  to  mai'ket 
points.  As  a  result  of  this  condition  of  feights,  it  is  in  a 
position  to  under-sell  the  lead  producers  of  other  countries 
in  the  United  States. 

Reports  from  Europe  state  that  the  supply  of  lead  there 
is  unusually  low  and  large  demands  are  being  made  on  the 
Mexican  mines.  Production  appears  to  be  below  normal  in 
nearly  all  producing  countries,  with  the  exception  of  Burma 
and  the  high  cost  of  transport  to  consuming  points  discounts 
the  low  cost  of  labor  there.  A  slight  increase  is  noted  in 
the  American  production.  Further  advances  in  the  price 
of  the  commodity  would  benefit  this  Canadian  company. 


January  6,   1922. 


THE       MONETARY      TIMES 


4> 


THE  CANADIAN  BANK 
OF  COMMERCE 


HEAD    OFFICE 


TORONTO 


STATEMENT    OF    THE 


RESULT    OF    THE 
ENDING  30th 


l<tilanr<>  at  <T('(Ii(  of  TrofU  ami  liOSM  Ar- 
j'ouiit,  broiiKht  forward  fi-uiii  last  yoar.    $1,783,979  37 

Net  profits  for  the  joar  eniliiiK  SOrli  \o- 
vciiilx-r,  after  providing  for  all  bml  and 
doubtful  debts  3,116,136  72 


94,900,116  09 


BUSINESS  OF  THE  BANK  FOR  THE  YEAR 
NOVEMBER,  1921 

I   This  ban  lM-<-n  appropriate*!  iwi  folluuN: 

DividendH $1,800,000  00 

Itonus    .,        160.000  00 

l>oiiiinion   and   Provincial   Govemnu-nt 

taxes    , 326,000  00 

Written   off   Bank   PrcmliH^   600,000  00 

Transferre<l  to  I'ension  Fund  ...„ 178,370  89 

Italanee  enrrled    forward I,M6,746  40 


$4,900,116  09 


CONDENSED  GENERAL  STATEMENT 
30th  November,  1921 


LIABIIjITIES 

Notes  of  tlie  Bank  in  eirenlation  $  23,477,574  88 

Deposits   n<it    beariUK   interest 98,985,984  79 

Deposits     l)earin}{     InttM-est,     IneliidinK 

aeerued    interest    254,169,215  74 


Halances  due  t«  other  Hanks  in  Canada 
Halanees  due  to  Itunks  olscwlicro  thun 

in    Canada    , 

Hills   Payable   

Arreptaiiees  under  liCtters  of  Credit.... 


59,738  01 

11,348,021  05 
2,758,126  73 
4,790,063  31 

$395,588,724  51 
4,447  62 


Dividends  I'npaid  ...". 

Dividend    and    bonus,    payable    Ist    !><*- 

<enil>er 600,000  00 

Capital  Paid  up  _...       15,000,000  00 

Rest   .\eeount    15,000,000  00 

Balance   of    Profits  as   per   Profit  and 

Imss  Aceount    1,946,746  40 


ASSETS 
(><;ld,   Silver  and   Dominion    NoK-s 
Deposit    in  Central  <<old   Ketterve?* 
Notes  and  Cheques  of  other  Banks 
Balanc<>s  due  by  other  Hanks  in  Canada 
Balanees  due  by  Banks  elsewhere  than 

in    Caniula    

Deposit    witli    the    >linister   of   tlnanre 

for   the   Circulation   Fund   

Bonds,   Debentures  and  Stocks 

Call  and  Short  I«>ans  

Other  Current  l>oans  and  Discounts  .... 
liiabililic!*  of  CuKtonii-rs  under   Ix-ttcrs 

of  Cretlit,  as  per  <-<inlra  

Ovenliie  Debts  (cstlinate<l  loos  providfHl 

for) 

lU-al   Kstate  and  Mortgages  

Bank    Preini.sos    , 

Otiier  Assets  not  included  In  the  fori*- 

golnts 


t  56,662,871  68 

9,600,000  00 

18,731,434  71 

308  11 

14,183,070  06 

800,000  00 

39,981,679  90 

46,810,790  87 

229,922,808  06 


$428,139,917  63 


4,790.063  31 

619,883  13 

776,922  83 

7,337,761  90 

122,323  78 

$428,139,917  53 


B.  E.  WALKER 


PRESIDENT 


JOHN  AIRD 

i.K\ER.\I.    M.\.'V.\(lt'l 


Report  of  the  Auditors  to  the  Shareholders  of  The  Canadian  Bank  of  Commerce 

(as  attached  to  the  full  General  Statement) 

In  accordance  with  the  provisions  of  sub-sections  19  and  20  of  section  56  of  the 
Bank  Act,  191.'1,  we  report  ns  follows: 

We  have  audited  the  above  Ba'.-jnce  Sheet  and  compared  It  with  the  books  and 
vouchers  at  Head  Office  and  with  the  certified  returns  from  the  branches.  We  hare 
obtained  all  the  information  and  explanations  that  we  have  required,  and  are  of  the 
opinion  that  the  transactions  of  the  Bank  which  have  come  under  our  notice  have 
been  within  the  powers  of  the  Bank. 

We  have  checked  the  cash,  and  verified  the  securities  representing  the  Inyeat- 
ments  of  the  Bank,  at  its  chief  office  and  principal  branches  at  a  date  other  than 
that  of  the  verification  at  the  chief  office  on  the  .lOth  November.  1921,  and  found 
that  they  were  in  aRreement  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.  Touche  A  Co.   ) 

D.  DEWAR,  C.A.  )   Auditors 

of  Marwick.  Mitchell  A  Co.   ) 


50 


THB      MONETARY      TIMBS 


Volume  68. 


TWELVE  MONTHS'  BANK  FIGURES  COMPARED 


Circulation 
(Average  monthly)  Deposits 

1919  1920  W19 
S                       $  $ 

November 248,073,385     253,576,534     728,657,589 

December 247,611,079     246,859,667     703,392,204 

1920  1921  1920 

January 237,269,805     229,608,213     621,408,024 

February 223,979,656     211,640,206     620,069,555 

March 231,220,770     215,931,035     657,412,028 

April 243,226,193     216,262,907     652,918,760 

May 235,085,179     207,359,887     645,957,229 

June 238,088,555     207,056,687     659,622,583 

July 240,833,686     203,134,777     039,415,025 

August 237,697,647     197,401,372     640,361,707 

September 242,988,866     198,552,227     677,286,905 

October 252,882,760     200,871,793     687,651,781 

Current  Loans  in 
Canada 

1919  1920 
$  $ 

November 1,189,408,523  1,257,973,118 

December 1,207,109,046  1,301,804,342 

1920  1921 

January 1,226,962,963  1,264,490,463 

February 1,257,015,902  1,266,235,381 

March 1,322,267,030  1,280,982,873 

April 1,347,238,230  1,281,145,047 

May    . .    . .   • 1,349,079,981  1,271,619,731 

June 1,365,151,083  1.756,642,883 

July 1,377,276,853  1,237,093,871 

August 1,385,470,153  1,226,467,704 

September 1,417,520,756  1,239,637,351 

October 1,405,401,227  1,243,748,818 


on  Demand. 

1920 

$ 

686,754,094 
667,496,742 

1921 
684,025,710 

561,578.474 
560,937,663 
552,121,294 
552,868,059 
562,194,316 
525,085,166 
527,362,713 
534,307,452 
565,650,636 

Current  Loans 
Abroad 


1919 
¥ 

149,302,293 
168,955,696 

1920 
182,533,124 
180,711,238 
183,642,658 
185,085,021 
183,986,222 
184,328,464 
190,914,052 
200,945,241 
202,590,184 


1920 

% 

173,379,729 
163,044,476 

164,093,930 
159,707,351 
159,087,151 
155,238,085 
155,846,239 
150,763,865 
151,489,861 
156,518,933 
169,677,657 


Deposits  after 

Notice. 


1919 
$ 
1,137,858,277 
1,138,086,691 

1920 
1,163,297,037 
1,187,027,307 
1,197,719,570 
1,209,573,760 
1,229,073,515 
1,243,700,977 
1,253,170,443 
1,261,647.732 
1,270,194,097 
1,271,275,751 


1920 

$ 
1,292,099,008 
1,293,007,488 

1921 
1,313,.  93,870 
1,318,855,482 
1,319,142,196 
1,313,832,514 
1,315,282,372 
1,308,778,473 
1,295,226,768 
1.279,830,731 
1,263,763,852 
1,251,323,839 

Call  Loans  in 

Canada 

1919       1920 

$         ¥ 

132,015,334   112,474,318 
127,251,919   112,680,497 


193,749,657184,540,917 


128,233,310 
125,644.859 
119,114,493 
115,360,894 
115,272,587 
113,598,923 
114,669,611 
113,135.902 
121,754,469 
125,888,760 


113,818,3.8 
110,289,586 
111,251,193 
107,552,69. 
110,775,140 
106,115,117 
106,729,270 
105,302,186 
108,471,340 
114,703,246 


Deposits  Abroad. 


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 
399,955,233 


1920 

$ 

351,780,924 

356,771,009 

1921 
318,622,947 
305,778,387 
300,181,609 
267,60. ,093 
269,074,347 
282,158,779 
274,231,912 
268,088,677 
295,574,501 
284,254,860 


Call  Loans 
Abroad 
1919        1920 
S  $ 

170,206,805   191,854,003 
184,469,882   190,413,527 


205,202.133 
206,229,451 
213,946,182 
203,045,209 
219,214,431 
193,888,245 
186,962,960 
188,367,459 
169,626,880 
172,232,161 


168,598,046 
154,173,055 
157,935,965 
160,890,729 
165,860,689 
157,757,835 
183,290,756 
172,013,135 
218,183,195 
211,442,652 


MONTREAL  AND  QrEBEC  SAVINGS  INSTITUTIONS 

Their  Experience  During  the  Past  Year  Has  Followert  That 
of  the  Cliartered  Banlcs 


TWO  Canadian  financial  institutions  which  are  not  very 
well  known,  because  of  their  local  nature,  are  the  Mont- 
real City  and  District  Savings  Bank  and  the  Caisse  d'Eco- 
nomie  Notre  Dame  de  Quebec.  Nevertheless,  they  are  both 
important  banking  organizations  in  their  respective  com- 
munities, despite  their  apparent  obscurity  from  the  rest 
of  the  country. 

In  recent  months.  The  Monetary  Times  has  placed  the 
affairs  of  both  these  banks  befare  the  financial  public  in 
brief  reviews,  and  perhaps  it  has  already  been,  observed 
that  their  position  as  compArcd  with  the  chartered  banks, 
is  by  no  means  insignificant. 

Perhaps  one  of  the  biggest  services,  outside  of  the  facil- 
ities offered  to  the  saving  public,  is  the  purchase  of  muni- 
cipal securities.  One-third  of  their  resources  are  invested 
in  such  bonds  and  debentures.  No  doubt  the  municipalities 
of  the  province  of  Quebec  are  well  represented  in  the  hold- 
ings of  these  banks. 

Regarding  liquid  condition,  these  French-Canadian  in- 
stitutions stand  higli,  compared  with  tlie  cliartered  banks. 
Of  course,  all  of  their  assets  are  more  or  less  liquid,  for 
loans  are  backed  by  some  tangible  security,  while  in  the 
chartered  banks  a  good  percentage  of  the  loans  are  made 
on  the  credit  of  the  borrower.  But,  strictly  speaking,  the 
ratio  of  liquid  assets  to  liabilities  to  the  public  in  the  case 
of  the  Montreal  bank  is  more  than  eighty  per  cent.,  while 
in  the  other  case  the  percentage  is  higher  than  seventy  ner 
cent. 

A  comparison  of  the  principal  accounts  over  a  period  of 
thirteen  months  makes  a  very  interesting  summary: 


Monlreal   City  and   District  Savings  Bank 


1930 
October    . . 
November 
Ppcember 

1921— 
January    .. 
Frbruary 


Notice 

Deposits 

.»43,950.117 

.  «,739,5I7 

.  45,448,298 

.  46,289,808 
.  46,933.0?0 


Loans  on 

Securities 

?9,576,381 

9,463,117 

9,314,280 

9,130,405 
8,619,123 


Can.  mull. 

Securities 

$15,071,560 

15,091,333 

15,508,.!l8 

15,204,085 
15^685,561 


Cash 
$7,037,959 
7,902,411 
8,173.364 

8,567,488 

8,772,889 


March     17,189,056  8,523,152  16,558,115  7,883,312 

April     47.348,066  8,273,440  16,705,095  8.384,918 

Mav 46,803,847  8,341,176  16,799,658  7,890,064 

Juiic    46,529,873  8,251,532  17,020,003  7,247,357 

.lillv       46.301,119  7,915.843  16,939,933  7.332,332 

August    46,258,673  7,616,241  16,910,601  7,621,759 

Seiitember    46,450,609  7,519,689  16,890,517  7,431,824 

Caisse   il'F.eiindnile   .Notre  Kainc  rte  Qiieliee 

.Notlee           Loans  on  Can.  Mun. 

1930                                       lieiiosits  Serurilles  Seeurltles  Cash 

October    $10,507,703  $3,213,922  $4,070,941  $1,520,243 

November     10,178,10!         3.224,999  4,070,489  1,386,887 

December     10,579,595         3,181,597  4,067,583  1,574,147 

1921— 

.laiiiiarv     10.711,418         3,221.694  4,066,980  1,709.277 

February    10,925,018         3,320,519  4,062,807  1,669.367 

Marrh     ll,0,«7,718         3.331,401  3.977,807  1,692,245 

April 11,113,740         3,294,420  3,975,774  1,701.042 

Mav    11.148,181           3,385,056  3,973,110  1,571.332 

June     10.932,018          3,377,623  3,967,841  1,388,151 

.TulV       10,801.969          3,360,966  3,965,342  1,317,669 

August    10,853,475         3,362,502  3,965,342  1,469,039 

September  10,883,553         3,364,612  3,962,035  1,494,281 

The   Quebec   Savings   Act 

Both  banks  are  subject  to  the  "Quebec  Savings  Bank 
Act,"  and  it  would  be  well  to  notice  how  they  are  control- 
led by  some  of  the  principal  statutes.  Money  may  be  bor- 
rowed by  taking  deposits  and  by  paying  Interest  thereon. 
Apparently  there  is  no  limit  to  which  deposits  may  be 
taken. 

At  least  twenty  per  cent,  of  the  deposits  must  be  held  in 
cash,  government  and  provincial  securities  of  the  Domin- 
ion, Canadian  municipal  debentures,  or  any  other  approved 
securities.  The  banks  have  more  than  complied  with  this 
rule,  as  already  noted.  Some  government  securities  are 
held,  but  resources  are  chiefly  in  the  form  of  cash  and 
municipal  bonds. 

Loans  may  be  made  to  anyone,  providing  suitable  col- 
lateral is  forthcoming.  Special  provisions  are  made  in  con- 
nection with  the  federal  and  provincial  governments,  muni- 
cipalities, and  other  institutions.  As  in  the  case  of  the 
chartered  banks,  no  loans  may  be  made  on  real  or  im- 
movable property. 

Montreal    City    and    District 

A  special  word  might  be  made  of  the  Montreal  City  and 
District  Savings  Bank,  in  view  of  its  present  standing  and 
past  history.  It  was  founded  in  1846  by  a  group  of  influ- 
ential  citizens   of  Montreal   in   order  to   promote  habits  of 


January  6,  1922. 


THE       M  O  N  i:  T  A   1{  V       T  I  M   K  S 


61 


■     A 

u  II II     -^  ^ 


A  Dominion- Wide  Scope 


BOARD  OP  DIRECTORS 

Sir    Willliim    I'ricc,    Oik'Iioc-,    Hon.    I'res, 

•lohn  Gait,  Winnipeg,  President 

';.    H.   Tliiimsoii,  Oik^IhH',   Vlco-Presldent 

stniihci)    Ila.is.    Toronto.    Vlce-l'reslficnt 

\V.  R.  Allan,  Winnipeg,  Vice-President 

('..    H.   Halfoiir,   WlnnipPK- 

0.   M.   HIack,  Winnipeg 

lliiriip    Hlake,    Toronio 

M.   Itiill.  Winnipeg 

Sir   .loliii    W.    Car.viMi.    i;.i;.,    Monironi 

n.   n.  ciiinyn.  Toronto 

!■;.    I,.    Iirowry,   Winnipeg 

s.  E.  i:il{in,   St.  John,  N.n. 

I>.  N.   l-innip,  Winnipeg 

.\.  Illtcncock.  Moose  Jaw,  Sask. 

J.  S.  lloiigli.  K.  C.  Winnipeg 

1'.   v..   Kcnaslon.  Minneapolis,   Minn. 

W.    II.    Malkiti,    Vancouver,    B.C. 


R.  O.  Mcculloch,  Call, 
Wm.   Shaw,   Quebec 


Ont. 


OFFICERS 

H.  B.  SHAW,  Winnipeg,  General  Manager 
.1.    W.    HAMILTON,    Winnipeg. 

Asst.  General  Manager 
I'.   W.   S.   CRISPO,  Winnipeg. 

Asst.  General  Manager 
•  iKO.   WILSON,  Toronto, 

Asst.  General  Manager 
I  .    W.    ASHR.   London.    Kng., 

Asst.   General  Manager 


A  IMING  to  give  a  helpful  and  efficient  banking  ser- 
-^^  vice  to  every  part  of  Canada  the  Union  Bank  of 
Canada  has  built  up  a  chain  of  380  branches  including 
the  most  important  points  throughout  the  country. 

We  operate  Farthest  North  as  well  as  from  Coast 
to  Coast — a  Dominion-wide  scope. 

Our  branches  in  London,  England,  Montreal,  Tor- 
onto, Winnipeg  and  Vancouver,  and  our  New  York 
Agency  (49  Wall  St.)  are  equipped  with  perfectly 
organized  Foreign  Exchange  Departments,  prepared 
to  finance  and  advise  Canadian  exporters  and  im- 
porters. 

In  addition,  branches  of  the  Park-Union  Foreign 
Banking  Corporation,  which  is  jointly  owned  and  con- 
trolled by  the  National  Park  Bank  of  New  York  and 
the  Union  Bank  of  Canada,  offer  direct  banking  con- 
nections in  the  Far  East,  at  Yokohama  and  Tokyo, 
Japan;  and  Shanghai,  China;  in  the  United  States,  at 
San  Francisco,  Cal.,  and  Seattle,  Wash.,  and  in  Paris, 
France. 


UNION  BANK  OF  CANADA 


Capital  and  Reserve 
Total  Assets   (Nov.  30,  1921) 


$14,000,000. 

over  $152,000,000 


52 


THE       MONETARY       TIMES 


Volume  68. 


industry  and  economy  among  the  working  people.  Savings 
banks  at  that  date  were  of  recent  creation.  The  idea  first 
arose  in  Switzerland,  in  the  last  of  the  eighteenth  century, 
and  the  first  saavings  bank  in  England  was  opened  in  180t. 

When  the  "City  and  District"  was  founded,  there  was 
already  a  Montreal  savings  bank  under  the  wing  of  the 
Bank  of  Montreal.  In  1871  the  federal  parliament  decided 
to  surround  the  savings  of  the  people  with  greater  safe- 
guards, and  they  gave  the  several  savings  banks  the  option 
of  subscribing  capital  stock  or  transferring  their  business 
to  a  chartered  bank  of  the  government  itself.  The  "City 
and  District"  chose  the  former,  and  to  this  day  has  remain- 
ed a  separate  institution,  although  none  the  less  valuable 
or  safe. 

The  beginnings  of  the  institution  were  slow  and  arduous. 
New  habits  had  to  be  inculcated  among  the  laboring  classes 
and  prejudices  had  to  be  overcome.  After  twenty-flve  years 
of  diligent  missionary  service,  the  number  of  depositors 
totalled  9,362,  and  the  amount  of  their  deposits  was  $2,880,- 
789.  In  the  jubilee  year  there  were  -15,593  depositors,  wtlh 
$9,360,783  to  their  credit.  There  are  now  more  than  200,000 
depositors,  with  deposits  of  nearly  $50,000,000. 


MOVEMENT  OP  CURRENT  AND  CAIiIi  LOANS 

Course   of   These   Accounts   in   Pa,st  Year,    in   Relation   to 
Movement  of  Prices 

COMPARING  the  figures  of  current  loans  and  discounts 
by  months  for  the  past  two  years,  and,  for  purposes 
of  such  comparisons,  weighting  them  according  to  the  value 
of  the  dollar,  measured  by  its  purchasing  power,  as  was 
done  with  the  deposits  in  another  column,  the  result  is 
rather  more  encouraging  than  the  mere  figures  would  indi- 
cate. At  the  same  time  they  still  show  below  the  figures 
of  December,  1913.  This  is  a  fair  indication  of  how  far 
business  is  below  normal.     The  trend,  however,  is  upward. 

000,000  omitted 
Value  of  Weighted 
1920  Dol'ar    Figures 

January    1226  40  490 

February    1257  40  503 

March    1322  38  502 

April    1347  38  512 

May    1349  38  512 

June  1365     38     525 

July  1377     39     537 

August  1385     40     536 

September  1417    41    580 

October  1405     42     590 

November  1357    44    596 

December  1301    46    598 

1921 

January  1264    48    606 

February 1266    50    633 

March  1280     51     652 

April  1281    53    678 

May  1271    54    686 

June  1256  56  703 

July   1237  57  704 

August    1226  57  698 

The  call  loans  In  Canada  and  abroad,  based  largely  on 
stock  exchange  collateral,  show  reductions,  indicating.  In 
Canada  at  any  rate,  a  steady  curtailment  of  accommodation 
for  this  class  of  business. 

Call  Money  in  New  York 

The  call  loans  elsewhere  than  in  Canada  are  in  a  some- 
what different  category.  These  funds  are  loaned  chiefly  in 
New  York,  being  placed  in  that  market  rather  than  at  home 
because  of  the  greater  ease  of  realization  there  than  in 
Canada.  At  times  this  policy  is  criticized,  but  it  is  sound 
nevertheless.  The  intention  is  to  hold  part  of  their  reserves 
invested  so  as  to  earn  a  revenue  and  at  the  same  time  have 
them  so  placed  that  they  can  be  realized  on  at  once  in  case 
of   need,    and    for   this    purpose    the   New   York   market   Is 


preferable  to  either  Montreal  or  Toronto.  Without  such 
use  of  their  surplus  the  earning  power  of  the  banks  would 
be  materially  reduced,  and  this  without  increasing  the 
amounts  available  for  Canadian  loans,  and  deprived  of  this 
outlet   it   would    simply    mean    increased    cash   held   in   the 


107 

104 
105 


5. 


-SKtIK  STWtnttlTiOUffi 


\9ZO 


H. 


\3Z\ 


J.  F. 


^. 


M.  h.  M. 


5, 


124 

yi\ 

IZO 


vaults  in  Canada,  and  cash  unemployed  produces  no  revenue. 
It  would  not  be  advisable  to  increase  Canadian  call  loans, 
as  in  the  event  of  a  stringency  necessitating  an  extensive 
calling  of  such  loans  realization  would  not  be  so  readily 
accomplished  as  under  the  present  system. 


POLICY  IJOANS  INCREASED 

New  loans  on  life  insurance  policies  made  during  the 
first  six  months  of  1921  were  $10,661,222,  an  increase  over 
the  previous  six  months.  The  following  comparative  figures 
come  from  the  Department  of  Insurance,  Oltawa,  and  relate 
to  companies  operating  under  Dominion  license: — 

,Ian.  1  to         July  1  to         Jan.  1  to 
June  30, '20    Dec.  31, '20    June  30, '21 
Bal.    at   beginning   of  period   $44,694,489      $46,071,026     $49,306,774 

Loans   macle    ........    6,962,033  9,432,678        10,661,222 

Loans    repaid    on    surrender  ,  „„„  „., 

of  policy    1,186,875  1,297,490  1,206,650 

Loans  repair  on  maturity  by 

death 383,590  278,020  335,444 

Loans     repaid     on     maturity  .„„„„,  .,„  r<,n 

otherwise  than  by  death..  701,059  767,077  637,569 

Prior  to  termination  of  pol-  .„,,„,„  ,  „„,  ,r« 

icy  .  3,313,972  3,854,343  4,031,750 

Total  repaid   5,585,496  6,196,930  6,211,413 

Balance  at  end  of  period...      46,071,026       49,306,774       53,756,583 


Car  Prices  Vk'ore  liowcr 

During  1921  the  prices  of  automobiles  dropped  almost 
as  a  general  thing  to  near  pre-war  levels,  and  it  is  llkeiy 
that  if  any  change  occurs  in  the  near  future  it  may  be 
towards  a  slightly  higher  level. 


January  6,   1922.  THEMONETARYTIMES  S3 


IMPERIAL   BANK 

OF  CANADA 


Capital  Paid  Up  $7,000,000  Reserve   Fund  $7,500,000 


The  Imperial  Bank  of  Canada,  established  over  forty  years  ago,  and  brought  to  a 
high  state  of  efficiency  in  service  and  equipment,  provides  for  every  modern  bank- 
ing requirement.  Each  of  its  220  branches  throughout  the  Dominion  conducts  a 
general  banking  business.  Collections  are  made  in  Canada  and  abroad ;  Domestic 
and  Foreign  exchange  bought  and  sold ;  Drafts  and  Letters  of  Credit  issued ; 
Government  and  Municipal  Securities  dealt  in;  Deposits  received  and  interest 
credited  at  current  rates.  Through  affiliation  and  close  co-operation  with  strong 
banking  institutions  in  Great  Britain  and  foreign  countries,  a  world-wide  financial 
service  is  available. 


Statement  of  Resources  and  Liabilities  as  on  Nov.  30th,  1921 

Resources : 

Cash  and  balances  due  from  the  banks    $25,689,344 

Imperial  Government,  Dominion  of  Canada  and  other 

Securities    15,162.353 

Other  loans 75,373,079 

Bank  Premises,  Real  Estate  other  than  Bank  Premises  and 

other  assets    6,780,284 

$123,005,060 
Liabilities : 

Notes  in  circulation $10,625,121 

Deposits   95,228.556     .  . 

Due  to  other  Banks .     1,029,661 

$106,883,338 
220  BRANCHES  THROUGHOUT  CANADA 


HEAD  OFFICE  -  TORONTO 

Peleg  Howland,  President  A.  E.  Phipps,  General  Manager 


1 


54 


THE      MONETARY      TIMES 


Volume  68. 


BANK  CLEARINGS  AND  WHAT  THEY  MEAN 

Figures   For   Past   Few   Months    Show   Big   Decrease,   But 
Prices  Have  Come  Down  Also 


THE  Clearing  House  figures  are  now  well  established  as 
an  indication  of  tlie  progress  of  trade  in  the  districts  to 
■which  they  apply,  and  their  rise  or  fall  by  weeks  and  months 
are  widely  commented  on  in  the  press.  Recently  they  have 
shown  a  declining'  tendency,  and  attention  is  drawn  to  the 
slackening  of  trade  denoted  thereby.  Under  normal  con- 
ditions much  of  the  comment  would  be  appropriate,  but 
these  are  not  normal  times,  and  unless  allowance  is  made 
for  altered  conditions  it  is  impossible  to  satisfactorily  com- 
pare  one    period   with    another. 

The  only  use  to  which  these  figures  can  be  put  is  to 
compare  with  tTr-'-e  of  other  periods  as  a  gauge  of  the  gen- 
eral trend  of  business.  They  cannot  be  used  to  show  the 
actual  volume  with  any  accuracy  as  the  figures  show  only 
the  transactions  between  different  banks.  They  do  not  in- 
clude transactions  when  these  are  between  the  customers  of 
the  same  bank,  nor  between  branches  of  the  same  bank. 
Also,  the  figures  in  the  larger  centres  are  swollen  by  clear- 
ing settlements  in  the  other  centres.  The  manner  of  settle- 
ment is  responsible  for  this  latter  as  it  is  only  in  one  centre 
in  each  province  that  settlement  is  by  legal  tender — Do-nm- 
ion  Government  Notes — the  other  clearing  houses  settling 
their  daily  balances  by  drafts  on  one  or  other  of  the  main 
clearing  centres.  The  figures,  however,  do  give  an  indication 
of  the  trend  of  business,  and  as  a  guide  in  this  are  valuable. 

Interpreting  Clearing   Figures 

Thev  cannot,  however,  be  used  in  the  "  raw."  They  are 
expressed  in  terms  of  money,  and  money  while  a  measure 
of  value  is  also  a  commodity  and  varies  in  value  according 
as  its  purchasing  power  increpset.  or  decreases.  The  basis 
of  this  is  the  fact  that,  when  goods  are  exchanged  for 
money  the  seller  of  the  goods  buys  the  money  from  his  cus- 
tomer quite  as  much  as  the  latter  buys  the  goods.  When 
prices  are  high  money  has  fallen  in  value,  and  vice  versa. 
This  is  now  decided  by  what  are  termed  index  numbers.  The 
average  wholesale  price  of  a  number  of  commodities  in 
common  use  over  a  certain  period  is  taken  as  the  standard, 
and  as  these  prices  rise  the  value  of  money  is  considered  to 
fall,  and  to  rise  when  these  prices  decline.  The  Canadian 
Department  of  Labor  issues  the  bulletin  of  prices  for  Can- 
ada, and  according  to  it  the  average  value  of  the  dollar  in 
1920,  as  compared  with  1913,  was  40  cents,  while  the  average 
for  the  first  8  months  of  1921  was  53  cents. — A  decided  in- 
crease in  the  purchasing  power  of  money,  i,e.  its  value. — 
When  the  clearing  figures  for  the  corresponding  penods  of 
the  two  years  are  adjusted  according  to  these  figures  the 
showing  made  does  not  indicate  a  reduction  in  volume  of 
actual  trade  as  would  appear  from  the  ordinary  figures. 

Actual  and  Adjusted  Values 

The  following  table  showing  the  actual  and  adjusted 
figures  for  the  last  three  months  in  1920  and  the  monthly 
clearings  up  to  the  end  of  September  1921, shows  that  al- 
lowing for  the  increased  value  of  the  dollar  there  has  been 
a  larger  activity  in  the  past  year  than  the  previous  one 
though  not  up  to  pre-war  levels. 

Actual  Adjusted 

August,  1920 1535  614 

September 1607  643 

October 1935  774 

November 2034  813 

December 1923  769 

J.inuary,  1921 1485  712 

February 1305  652 

March 1336  681 

April 1466  777 

May 1515  818 

June 1472  824 

July 1365  778 

August 1288  735 

September 1338 

October 1542 


The  total  clearings  for  1913  were  $9,260,000,000  while 
those  for  1920  were  $20,283,000  000.  The  dollar  in  1920 
however  was  worth  40  cents  in  comparison  to  that  of  1913, 
and  the  clearings  of  1920  measured  by  the  standard  of  the 
former  year  would  show  as  $8,113,000,000,  indicating  a 
volume  of  actual  trade    considerably  less   than  that  of  1913. 

In  comparing  totals  of  various  cities  in  Canada  with 
those  of  cities  in  the  United  States  it  must  be  remembered 
that  the  Canadian  fign^res  include  bank  notes,  which  each 
bank  receives  in  the  course  of  business  and  sends  in  to  the 
bank  of  issue  for  redemption  daily.  In  the  United  States 
the  issues  of  bank  notes  are  based  not  on  the  assets  of  the 
banks,  as  with  us,  but  on  United  States  bonds  lodged  with 
the  Treasury  Department,  and  the  notes  therefore  are  not 
sent  in  for  redemption  as  in  Canada. 


LOANS  TO  BANK  DIKECTORS 


Figures   Show   Only   a   Small   Variation   Over  a  Period   of 
Four   Years 


IT  may  be  just  a  matter  of  curiosity,  or  it  may  be  for  some 
deeper  reason,  that  the  minister  of  finance  requires  a 
little  "inside  information"  on  the  affairs  of  our  banks  each 
month,  although  the  amount  of  facts  required  is  just  a 
little,  and  only  a  fraction  of  what  the  Uuited  States  govern- 
ment demands  of  the  banks  in  that  country. 

The  Canadian  government,  unlike  other  governments,  does 
not  make  a  public  examination  of  the  banks,  for  it  has  been 
found  that  the  banks  can  do  that  best  themselves,  and 
furthermore,  the  ordeal  through  which  a  new  bank  has  to 
pass  before  it  can  start  business  is  much  more  severe  than 
in  the  Uuited  States,  where  there  is  government  regulation, 
thus  limiting  the  possibilities  of  the  springing  up  of  undesir- 
able institutions. 

But  in  addition  to  the  statement  of  regular  accounts,  the 
government  desires  of  the  chartered  banks  each  month, 
figures  showing  the  average  amount  of  cash  holdings.  This 
may  be  to  prevent  bank  officials  from  developing  that  im- 
proper, but  not  unusual  habit  of  strengthening  cash  reserves 
when  statement  time  comes  round,  although  you  can't  really 
blame  the  banks  for  wanting  a  little  "window  dressing," 
for  ;i/ter  a'l,  as  one  of  our  clearing  house  managers  is  fond 
of  pointing  out,  there  is  a  close  analogy  between  the  bank 
oni  retail  store,  and  it  is  only  natural  thr.t  the  banks  want 
to  look  their  best  when  most  in  the  eyes  of  the  public. 

Hov/ever,  it  is  not  to  ch.vell  on  that  point  but  to  pass  on 
to  the  other  important  request  which  the  treasury  depart- 
ment makes  of  the  banks,  and  that  is  the  amount  of  loans 
to  directors  and  firms  of  which  they  are  partners.  Of  course, 
no  sensible  banker  will  jeopardize  the  position  of  his  insti- 
tution for  the  sake  of  another  concern  in  which  he  is 
interested,  although  there  is  undoubtedly  a  favortism  which 
might  be  overextended  in  times  of  trouble. 

The  past  year  has  been  one  of  strain  to  a  good  many  in- 
dustries and  commercial  concerns,  and  view  of  the  financial 
interest  which  a  good  many  of  our  bankers  have  in  such 
businesses,  it  would  have  not  been  surprising  to  have  seen 
an  increase  in  the  amount  of  loans  to  directors  and  the  firms 
in  which  they  were  partners.  As  a  matter  of  fact  the  volume 
of  loans  was  smaller  than  previously,  and  just  as  regular 
as  in  the  few  preceding  years. 

The  following  figures  show  the  recent  trend  of  such  loans: 

1918  1919  1920  1921 

January    ...  $8,282,811  $8,412,3.52  $10,193,668  $10,229,001 

rXuary    ..  8124  358  8,935,094  10,486,347  10,445,676 

Mnrch  9,490  038  9,513,529  10,838,430  11,130,653 

8-^04  424  9,274,523  11,152,329  10,453,095 

May            ...  7',967',892  7,919,869  10,753,595  9,618,890 

June  ■  ■  8,013,622  7,275,448  10,506,652  9,694,636 

julv     7  642,280  8,645,725  10,408,321  9,786,022 

ZLst 7,544298  8  545,891  10,514,251  9,390,964 

September"".  7  227  344  9135,518  9,641,328  9,158,030 

October        ..  7,329893  8,837,140  9,951,009  9.129,816 

UctoDer  ,'.,9'3„  io,742,309  9,567,858 

;-    •     ■    ..  9,021,436  9,573,924  10,359,428 


January   0,   1922.  THEM0NETARYTIME8  M 

lllllllilllllllllllllillllllllllllllllllllllllllillll^ 


The  Bank  of  Nova  Scotia 

ESTABLISHED  1832 

Capital $    9,700,000 

Reserve  Fund       ....  18,000,000 

Total  Assets 230,000,000 

General  Office  Toronto,  Canada 

H.  A.  RICHARDSON General  Manager 

BRANCHES  IN  CANADA 

46  in  Nova  Scotia  133  in  Ontario  20  in  Quebec 

11    in  Prince  Edward  Island  42   in   New  Brunswick  34  in  Western   Provinces 

NEWFOUNDLAND 

St.  John's  and  23  other  points 

WEST    INDIES 

CUBA Havana 

PORTO  RICO Fajardo,  Ponce,  San  Juan 

JAMAICA  ....  Kingston  and   10  other  points 

DOMINICAN  REPUBLIC       -     Santo  Domingo,  San  Pedro  de  Macoris 

and  Santiago  de  los  Caballeros 

UNITED  STATES 

Boston  Chicago  New  York  (52  Wall  Street)  • 

GREAT  BRITAIN 

LONDON,  ENGLAND     -     -     -      55  Old  Broad  St.,  E.C.  2 

Correspondents 

GREAT  BRITAIN — London  Joint  City  and  Midland   Bank,   Ltd.;   Bank  of  England;   Royal   Bank 

of  Scotland. 

FRANCE — Credit  Lyonnais. 

UNITED  STATES — Bank  of  New  York.  N.B.A.,  National  Bank  of  Commerce.  New  York;  Mer- 
chants 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. 


Illlllllllllilllllllilllllllllillllllllilllllllilll^ 


56 


THE      MONETARY      TIMES 


Volume  68. 


LEGAL  DECISIONS  ON  PUBLIC  FINANCE 


County  Court's  Attitude  on  Doininion  Income  Tax — City  of 
Medicine  Hat  Charter — Decision  on  Quebec  Succession  Duties 


CASES  before  Canadian  Courts  reported  in  the  Monetary 
Times   during   the   past   year,   have   involved   matters 
touching  on  our  triple  government  financial  scheme. 

The  most  outstanding  is  one  in  which  Judge  Gunn  of 
the  Carleton  County  Court  he'd  an  appeal  that  no  justice 
of  the  peace  or  magistrate  has  jurisdiction  to  try  cases  where 
false  Dominion  Income  Tax  returns  are  alleged  to  have  been 
made.  His  judgment  concludes  as  follows: 

"I  am  opposed  to  the  conviction  made  in  support  of  this 
conviction  that  the  War  Income  Tax  Act  imposing,  as  it  does, 
the  making  of  returns  extending  in  number  to  hundreds  of 
thousands,  makes  it  lawful  for  the  minister  of  finance  or  any 
authorized  official  of  that  department  to  lay  a  complaint 
against  any  or  all  of  those  returns  containing  a  false  state- 
ment of  the  income  of  any  taxpayer  and  subjects  him  to  the 
judgment  of  any  magistrate  or  justice  of  the  peace  to  deter- 
mine his  liability  for  $10,000  or  six  months'  imprisonment, 
or  both,  in  such  a  decision,  until  I  hear  it  clearly  st>ated  so 
in  that  act,  and  as  it  stands,  parliament  haing  given  expressly 
all  jurisdiction  to  the  Exchequer  Court,  1  do  not  appreciate 
the  attempt  here  made  to  institute  proceedings  before  a 
provincial  authority  of  inferior  jurisdiction,  as  it  means  and 
leads  to  far-reaohing  convictions  not  reasonably  within  the 
consideration. 

"There  have  been  so  many  annual  amendments  to  the 
income  act  that  any  returns  made  in  1917  and  1918,  no 
matter  how  correct  then,  cou'd  be  false  now  as  'income'  was 
by  these  amendments  given  an  extended  meaning,  and  the 
defendant  might  well  say  truthfully  tbat  the  returns  of  1917 
and  1918  are  not  correct — but  false — and  stnll  be  guiltless 
of  the  penalty.  In  any  case  I  am  clearly  of  the  opinion  that 
the  injection  of  the  words  'on  su-nmary  conviction'  in  sub- 
section 2  of  section  9  does  not  clearly  and  expressly  confer 
jurisdiction  on  any  magistrate  or  justice  of  the  peace  to 
convict  any  person  of  any  penalty  laid  by  the  Income  War 
Tax  Act. 

Another  decision  was  given  ty  Judge  Gunn  with 
reference  to  the  Sales  Tax,  during  the  year.  The  Attorney 
General  of  Canada  brought  action  against  Peter  Karson, 
•candy  merchant,  to  recover  the  ten  per  cent,  manufacturers 
tax  on  the  candies  made  by  him,  as  well  as  the  sales  tax  for 
the  same  candies  when  so'd  across  his  counter. 

The  action  was  brotight  at  the  instigation  of  the 
Department  of  Inland  Revenue,  which  took  tihe  position  that 
although  the  candies  made  by  Karson  were  used  entirely  in 
connection  with  his  retail  business,  he  was  nevertheless  a 
manufactt-ier  and  under  sectrions  19  BB  and  19  BBB,  be- 
came liable  for  the  taxes  sued  for. 

Judge  Gunn  holds  that  the  section  governing  the  10  per 
cent,  manufactureres'  tax  is  by  its  wording  limited  to  goods' 
imported   or,    at  all  events    goods    which  have    a  duty-paid 
value,  and  that,  as  the  defendant's  foods  did  not  come  under 
this  heading,  no  manufacturers'  tax  was  payable. 
Taxes   Recoverable   By   Personal   Action 

In  an  appeal  by  the  city  of  Medicine  Hat  from  a  judg- 
ment on  a  special  case  where  the  city  sought  personal 
judgment  for  taxes  alleged  to  be  due  to  the  city  in  respect 
of  real  property  situated  therein,  it  was  held  that  certain 
sections  of  the  city's  charter,  makes  taxes  which  are  due  it 
a  debt  recoverable  in  a  personal  action  by  it  and  the 
cmmission  to  include  the  lots  in  a  tax  sa^e  which  was  held 
does  not  release  the  debtor  from  his  liabilities. 
Provisions  of  Statute 

Justice  Stuart  in  his  judgment  says:  "It  was  contended 
by  the  defendant  that  the  act  in  question  did  not  give  any 
right  to  the  corporation  to  recover  the  taxes  as  a  debt.  The 
material  cections  of  the  act  contained  in  title  32  are  as 
follows :  '6.  The  taxes  due  upon  a;iy  land  may  be  recovered 
from  any  owner  or  tenant  originally  assessed  therefor  and 
from  any  subsequent  oviTier  of  the  who'e  or  any  part  thereof 
saving  his  recourse  against  any  other  person,  and  such  taxes 
shall  be  a  special  lien  upon  the  land  and  shall  be  collectable 
by  action  or  distraint  in  priority  to  every  claim,  privilege, 


lien  or  encumbrance  of  every  person  except  the  King;  and 
Hen  in  its  priority  shal .  not  be  lost  or  impaired  by  any 
neglect,  omission  or  error  of  any  officer  of  the  city.  7.  The 
1  of  a  copy  of  so  much  of  the  roll  as  relates  to  the 
1  phle  by  any  person  in  the  city  certified  as  a  true 
copy  by  the  secretary-treasurer  shall  be  conclusive  evidence 
of  the  debt.' 

"It  is  apparently  well  settled  law  that  a  tax  is  not  a 
debt  un'ess  expre3sly  declared  to  be  so  by  the  statute  im- 
posing it.  The  simple  question  is  whether  by  the  words  used 
in  the  above  sections,  the  court  should  hold  that  the  statute 
has  declared  the  taxes  to  be  a  debt.  The  words  are  prac- 
tically the  same  as  those  of  section  305  of  the  Iowa  Act,  and 
in  the  case  of  'Castor  v.  Fenton,'  the  chief  justice  held  that 
under  the  latter  section  taxes  could  be  recovered  in  a 
personal  action  as  a  debt. 

Gives  Right  to  Personal  Action 

"It  is  a  settled  canon  of  construction  that  a  statute 
ought  to  be  so  construed  that  if  it  can  be  prevented,  no 
clause,  sentence  or  word  shall  be  superfluous,  void  or  insig- 
nificant. So  in  the  present  case  if  the  contention  of  the 
defendants  be  correct  as  to  the  meaning  of  section  6  of  tit'e 
32 — viz.,  that  it  merely  creates  a  lien  and  gives  a  right  to 
collect  the  taxes  in  an  action  to  enforce  the  lien  or  by  dis- 
tress, then  all  the  words  of  the  section  down  to  'thereof  in 
the  third  line  are  superfluous.  They  would  in  that  case,  add 
absolutely  nothing  whatever  to  the  meaning  of  the  statute 
because  everything  that  the  defendants  admit  is  done  by  the 
section  is  done  fully  and  completely  by  the  succeeding 
words. 

"I  cannot  but  conclude  that  the  real  meaning  and  effect 
of  the  statute  is  to  make  the  taxes  a  debt  recoverable  by 
perional  judgment  and  I  therefore  think  the  appeal  should 
be  allowed  with  costs  and  I  see  nothing  in  the  statute  which 
shows  that  the  omission  to  include  the  lots  in  a  tax  sale 
which  was  held  would  release  the  defendants  from  their 
liability." 

Succession   Duties 

Following  in  the  long  line  of  decisions  on  Succession 
Duties  and  the  methods  of  imposition,  the  Supreme  Court 
of  Canada  handed  down  a  decision  in  the  case  of  Barthe  v. 
AUeyn-Sharples,  on  appeal  from  the  King's  Bench  Court 
of  Quebec. 

The  facts  of  the  case  were:  Amongst  other  assets,  the 
estate  of  the  late  John  Sharpies,  who  died  domiciled  in  the 
province  of  Quebec,  in  Ju'.y,  1913,  comprised  shares  in 
various  companies  (most  of  them  foreign),  whose  head 
offices  were  not  in  that  province,  of  which  the  aggregate 
va'ue  was  $213,039.75  The  defendant  Margaret  Alleyn- 
Sharples  is  the  universal  legatee  in  ownership.  The  plaintiff 
Barthe,  as  collector  of  provincial  revenue,  sues  to  recover 
succession  duties  in  re3p€ct  of  this  property. 

The  article  in  question,  of  the  Quebec  Succession  Duty 
Act,    read:  — 

"1387(b).  All  transmissions  within  the  province,  owing 
to  the  death  of  a  person  domiciled  therein,  of  movable 
property  locally  situate  outside  the  province  at  the  time 
of  such  death,  shall  be  liable  to  the  following  taxes,  calcu- 
lated uopn  the  value  of  the  property  so  transmitted,  after 
deducting  debts  and  charges  as  hereinafter  mentioned." 

The   Hon.    Mr.   Justice  Davies  in  his  judgment  says: 

"The  Superior  Court,  acting  upon  and  applying  the 
we'1-known  rule  mobilia  sequuntur  personam,  gave  judg- 
ment for  the  plaintiff  &8-qwaU'.e  for  the  amount  of  the  duties 
levied  and  payable  under  the  statute.  The  judgment  was 
reversed  on  appeal  by  the  Court  of  King's  Bench  in  a 
majority  judgment  of  that  Court  which  held  that  'the 
powers  of  the  provincial  legislature  are  not  plenary  but 
limited  to  "direct  taxation  within  the  province;"  (British 
North  America  Act,  sec.  92  (2)  ;  and  that  any  attempt  to 
levy  a  tax  on  property  locally  situate  outside  the  province 
is  not  taxation  within  the  province  and  is  beyond  the  com- 
petence of  the  provincial  legislature;  that  the  taxation  of 
transmissions  within  the  province  of  property  locally 
situate  outside  the  province  is  an  attempt  to  do  indirectly 
that  which  the  legislature  is  forbidden  to  do  directly  and 
is  in  effect  taxation  of  property  within  the  province;     and 


January   6,   1922. 


THE      MONETARY      TIMES 


FIRST 


Established  in  1882,  The  Toronto  General  Trusts 
Corporation  was  the  first  trust  company  in  Canada. 

It  is  absolutely  free  from  affiliation  with  other 
financial  concerns — a  trust  company  confining  itself  to 
the  duties  of  executor,  trustee  and  agent  and  elimin- 
ating from  its  transactions  everything  of  a  speculative 
character. 

Estates  and  trusts  under  the  care  of  this  Corporation 
are  managed  by  officers  of  wide  experience  in  property 
management,  supported  by  an  efficient  organization. 

We  invite  the  business  of  responsible  people,  offering 
complete  and  convenient  financial  service  in  every  con- 
servative form. 

President 

Hon.  FEATHERSTON  OSLER.  K.C.,  D.C.L. 

Vice-Presidents 
HAMILTON  CASSELS.  K.C..  LL.D. 

Brig.-Gen.  SIR  JOHN  M.  GIBSON,  K.C.M.G.,  K.C..  LL.D. 

A.  D.  LANGMUIR 

Gen.  Manager 

Head  Office:    Cor.  Bay  and  Melinda  Streets, 
TORONTO 

Branches:  Ottawa  Winnipeg  Saskatoon  VancouTer 


W.  G.  WATSON 
Asst.  Gen.   Manager 


The  Toronto  General  Trusts  Corporation. 


68 


THE      MONETARY      TIMES 


Volume  68. 


that  the  property    and  shares    in  question    in  this  case  are 
locally  situate  and  have  a  situs  outside  the  province." 
Domicile  of  the  Owner 

"I  agree  with  that  part  of  this  judgment  which  declares 
the  powers  of  the  provincial  legislature  not  to  be  plenary 
but  to  be  limited  to  'direct  taxation  within  the  province.' 
And  I  further  agree  that  the  taxation  of  'transmissions 
within  the  province'  of  property  locally  situate  outside  it 
is  an  attempt  to  do  indirectly  that  which  tlie  legislature 
cannot  do  directly,  but  I  differ  from  the  conclusion  reached 
by  the  Court  that  the  property  i^nd  shares  in  question  in 
this  case  are  locally  situate  and  have  a  situs  outside  of  the 
province  and  so  beyond  the  jurisdiction  of  the  province  leg- 
islature in  levying  succession  duties.  The  judgment  now  in 
appeal  ignores  the  application  of  the  ru'e  making  the 
domicile  of  the  deceased  owner,  in  questions  arising  out  of 
succession  and  legacy  duties,  the  test  of  the  situs  of  the 
property  and  shares  in  question  and  adopts  that  which  allots 
the  situs  to  the  location  of  the  head  office  of  the  respective 
companies  ?nd  so  carries  this  intangible  property  outside 
of  the  province  of  Quebec. 

"I  may  say  that  ovidng  to  the  grave  and  great  import- 
ance of  the  question  I  have  deemed  it  right  in  this  appeal 
again  to  reread  all  these  authorities  with  the  result  that  1 
am  more  firmly  convinced  than  ever,  that,  in  construing  the 
powers  of  'direct  taxation  within  the  province'  granted  to 
provincia'  legslatures  by  our  Constitutional  Act,  so  far  as 
the  levying  of  succession  and  legacy  duties  are  concerned, 
the  true  rule  is  that  which  existed  alike  in  Great  Britain  as 
in  the  province  of  Quebec  at  the  time  such  act  was  passed, 
namely,  that  the  domicile  of  the  deceased  owner  of  the  prop- 
erty, and  not  its  actual  location  at  his  death,  determined 
which  province  could  impose  succession  and  legacy  duties 
upon  it.  That  rule  is  not  applicable  in  the  construction  of 
statutes  levying  probate  and  estate  duties  or  other  taxes, 
but  i?  confined  to  succe^eion  and  legacy  duties.  The  who'e 
question  was  thoroughly  thrashed  out  and  determined  in  the 
House  of  Lords  in  the  appeal  case  of  Winans  vs.  Attorney- 
General  where  the  rules  respecting  succession  and  legacy 
duties  and  estate  and  probate  duties  are  clearly  laid  down 
and  the  reasons  for  the  application  of  the  mobilia  rule  to 
the  two  classes  of  duties,  succession  and  legacy  are  given 
and  for  its  non-application  to  estate  and  probate  duties.  I 
was  great'y  tempted  to  enbody  in  these  reasons  of  mine 
some  extvacts  from  the  judgments  of  the  noble  lords  who 
decided  that  case.  They  were  unanimous  in  their  reasons  for 
the  judgment  they  delivered  in  determining  that  so  far  as 
succes  ion  and  legacy  duties  were  concerned  the  domicile  of 
the  deceased  owner,  snd  not  the  local  situation  of  the  prop- 
erty, must  be  taken  as  the  controlling  factor." 

DOMINION   AND  POST   OFFICE  BANKS 


They  Have  Been  Steadily  Losing  Ground  During  Past  Few 

Years — IjOsscs  in   1921 


FOR  the  past  two  or  three  years  the  government  banking 
systems  in  this  country  have  not  been  producing  very 
good  results.  Not  only  have  deposits  fallen  off  to  a  marked 
degree,  but  withdrawals  have  been  made  in  big  volume. 

There  are  several  reasons,  all  of  which  seem  important. 
The  convenience  and  safety  of  the  chartered  banks,  with 
their  numerous  branches  within  a  short  distance  of  nearly 
all  of  the  saving  public,  is  being  more  greatly  appreciated, 
and  the  government  Is  thereby  losing  a  good  deal  of 
custom. 

The  interest  paid  to  the  depositors  Is  no  more  than 
that  paid  by  chartered  banks,  so  that  there  is  no  induce- 
ment for  the  people  to  go  to  all  the  trouble  which  is  in- 
volved  in   depositing  and  withdrawing  funds 

Furthermore,  the  government  institutions  are  essentially 
the  "poor  man's"  savings  banks,  because  they  operate  chief- 
ly for  the  benefit  of  the  poorer  classes  of  people  and  those 
who  are  ignorant  and  suspicious  of  the  safety  of  the 
chartered  banks,  and  in  view  of  the  conditions  which  the 
average  laborer  or  workingnian  has  been  up  igainsc  in  the 
past  year,  it  is  not  surprising  to  find  a  big  drop  in  savings 
and  heavy  withdrawals. 


Unemployment  has  been  acute  amongst  the  laboring 
class,  and  where  there  has  been  employment,  wages  have 
been  reduced  to  a  much  lower  scale.  Even  chartered  bank 
deposits  have  fallen  away  largely,  so  that  it  is  hardly  likely 
that  the  government  institutions  would  have  been  affected 
differently.  The  trend  of  deposits  and  withdrawals  of  the 
Post  Office  Savings  Banks  during  the  past  thirteen  months, 
is  as  follows: 

Post  Office  Savings 
1920  Deposits.      Withdrawals. 

October   $591,725  $    775,766 

November    621,357  854,377 

December   537,243  789,540 

1921— 

January    487,321  759,373 

February    380,724  898,940 

March    404,217  963,732 

April  307,901  1,166,195 

May    324,738  1,024,042 

June    315,608  830,753 

July  287,480  751,629 

August    286,932  786,545 

The  balance  at  the  credit  of  depositors  in  the  post 
office  banks  at  the  end  of  October,  1919,  was  $35,810,419, 
but  by  November,  1920,  this  figure  was  reduced  to  $29,156,- 
896,  and  is  now  as  low  as  $ 

Results  in  the  Dominion  government  savings  banks  in 
recent  months  are  as  follows: 

Dominion  Government  Savings  Bank 
1920  Deposits.      Withdrawals. 

October    $155,350  $180,441 

November    181,132  181,142 

December   .^  199,186  ♦547,746 

1921. 

January  177,767  ♦534,832 

February   143,618  109,059 

March   127,902  126,760 

April   172,485  210,792 

May   164,792  223,076 

June 128,491  189,503 

J  uly   

August   

September  108,824  167,145 

October    116,907  185,664 

At  the  end  of  October,  1919,  the  balance  in  these  banks 
was  $11,074,418,  and  by  December,  1920,  the  figure  had  been 
reduced  to  $10,188,315,  and  is  now  $9,678,624. 

The  Money  Is  Cheap 

Under  ordinary  circumstances  the  government  would 
be  profiting  by  these  savings  banks,  for  it  is  similar  to 
securing  a  loan  at  a  ver>-  cheap  rate.  At  the  present  time, 
however,  it  hardly  seems  as  though  there  are  any  ad- 
vantages at  all,  for  a  good  deal  more  is  being  withdrawn 
than  is  put  in,  and  this  is  a  costly  undertaking. 

As  stated  before,  the  interest  is  only  three  per  cent., 
but  the  cost  to  the  government  is  nearer  four  per  cent., 
after  taking  into  consideration  the  cost  of  keeping 
accounts. 

If  an  adequate  reserve  were  maintained  it  would  bring 
the  cost  still  greater,  but  the  government  avoids  the  ex- 
pense and  responsibility  by  a  clause  in  the  Bank  Act  which 
makes  it  compulsory  for  banks  to  honor  government 
cheques  without  charge  wherever  presented,  and  nearly  all 
withdrawals  are  made  in  this  form. 


YUKON   G01.D   PRODUCTION 


The  gold  yield  in  the  Yukon  Valley,  including  Cana- 
dian and  New  York  territory,  for  the  season  of  1921, 
aggregated  approximately  $4,000,000,  according  to  V. 
Richards,  superintendent  of  the  Northern  Comme(rcial 
Posts  of  Alaska.  Of  this  amount  ?2, 675, 000  came  from 
interior  Alaska,  ?1, 250, ODD  from  the  Yukon  Territory, 
and   $75,000  from  Atlin,   B.   C. 


January   6,   1922. 


THE      MONETARY      TIMES 


59 


Capital,  $2,000,000 


Reserve,  $2,000,000 


National  Trust  Company 

Limited 

Executor        Guardian        Administrator         Assignee        Trustee        Liquidator 

Pbesident:  SIR  JOSEPH  FLAVELLE,  Bart. 

Vice-Pbesidents:   E.  R.  WOOD,  W.  E.  RUNDLE,  HERBERT  C.  COX. 

W.  E.  RUNDLE,  General  Mavalku. 


Chester  D.  Massbt 

H.  H.  FumiER 

H.  B.  Walker 

Hon.  Sir  Edward  Kemp,  K.C.M.G. 

J.  H.  Plummkr.  D.C.L. 

Hon.  F.  H.  Phipi'en,  K.C 

H.   J.   FULLEB 

T.    B.   MACAtJI.AY 


Board  of  Directors: 

W.   M.    BlRKB 

E.  M.  Saunders 

Sir  John  Aird 

Fkki).  W.  Harcourt,  K.C. 

Jame.s  Ryrie 

Miller  Lash 

HARRiNdTON  E.  Walker 

Norman  J.  Dawes 


Rt.  Hon.  Sib  Thomas 
Whi-iX.  K.C.M.G. 
LEIIillTON  McCartht,    K.C. 
A.  McT.  Campbell 
Kenneth  Mackenzie 
GTORfiE  W.  Allen,  K.C.,  M.P. 
Carl  Riobdon 
Edward  Fitzgerald 


Head  Office:    18-22  King  Street  East,  Toronto 


Montroiil 


WiiiniiK'K 


Kdiiiontoii 


K<-Kinit 


SaKkat<M>n 


London,   England 


Saskatchewan    General 
Trusts  Corporation 

Limited 

AUTHORIZED  TO   ACT  AS 

Executor,  Administrator 
Trustee  under  Bankruptcy  Act 

Arts   as   Agent   for   niaking  Investments 

ill  First  Mortsagi's  aii<l  other  First  Class 

Secniities 

BOAHD    OF    DIRECTORS: 

W.  T.  Milliard,  rrcsidcnl        li.  li.  Itarr,  K.C.  Vlce-I'reslrtenl 

.1.   A.  Mrtirldc  C.  II.  \Vllu)HKni),>  %V.  U.  niincan 

.1.  A.    M.   ratrick,  K.C.  Piivlil  Low.  .M.D.  Win.  Wilson 

A.   I  .   corrion,   K.i:.  Heiiiorl   K.   Sampson.   K.r. 

General  ManaRor         E.  E.  Murphy 
HEAD  OFFICE 

1811  CORNWALL  STREET 
REGINA,  SASK. 

(Official   administrator  for  the  judicial 
district  of  Weyburn,  Sask.) 


iiprranttlF  (TruHt 

Compaiip  of  Canaba  Himiteb 

HAMILTON,  ONTARIO 


Palil-I'li  Capital,  $500,0<M] 


Reaenre.  $12S,00O 


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  super- 
vision of  the  Executive  Committee 


Col. 


BOARD  OF  DIRECTORS: 

Cyrus  A.  Biboe,  President 
H.  L.  Roberts  and  Jamks  TvaNBCtx.  - 
Vice-Presidents 
T.  C.  Haslett,  K.C.  Chairman  Executive  Committee 

C.  C.  Dalton.        A.  E.  Drment,        J.  J.  Greene. 

Sir  John  S.   Hendrle,  K.C.M.O.,  J.  F.  KaTana«h. 

Col.  John   I.  McLa.-en,         Lt-Col.  W.   H,  Merrltt. 

MaJ.-Gen.   Hon.   S.   C.   Mewburn.  SUnley   Mills. 

C.  S.  Wilcox.        W.  A.  Wood. 

S.  C.  Macdonalo,  Manager 


60 


THE       MONETARY       TIMES 


Volume  68. 


■N 


HOW  BANK  BRANCHES  ARE  DISTRIBUTED 


(Figures  are  as  at  October  31,  1921.) 


rt  -T. 


BA'SKS: 

Commerce  . . 
Dominion   . . 
Hamilton   . . 
Horhelaga   . . 
Home   . .   . . 
Imiierial   . . 
Merchants  . . 
Molsons  . .   . . 
Montreal    . . 
Nationale   . . 
Nova  Scotia 
Provincial  . . 
Royal   . .    . . 
Standard    .. 
Sterling-    ..    . 
Toronto    . .    . 
Union   ..    .. 
Weyburn  .. 
Total    . 


o 

132 
89 
73 
35 
47 

113 

130 

73 

98 

2 

133 
23 

196 

124 
71 
83 

101 


c 

89 

6 

1 

278 

4 

3 

44 

47 

50 

101 

20 

248 

64 

1 

1 

10 

10 


26 


15 


72 


35 


-I- 


-I- 


10 

64 

35 

79 

71 

4 

16 

7 

8 

12 

33 

29 

15 

24 

12 

15 

2 

10 

10 

a 

18 

12 

35 

39 

15 

38 

41 

75 

3 

2 

4 

16 

1 

51 

17 

43 

15 

42 

■'ii 

4 

10 

16 

4 

25 

3 

25 

10 

55 

38 

99 

44 

1 

1 

6 

7 

21 
4 

24 

4 

13 

33 

16 

3 

1 

9 

67 

109 
24 

67 

-I- 


1-^ 

2 


-I- 


2S 

4 
1 


SI 


18 


13 


-531 
132 
163 
364 

75 
220 
349 
129 
32:! 
104 
332 
299 
718 
178 

83 
159 
374 

24 


1523  f  977  I  164  |  130  |   36  |  242  |  328  |  552  |  339 


45  I      15 


110 


14  I        3  i    4r,r,' 


THE  PAST  YEAR  IN  THE  BOND  MARKET 


Huiinner  Months  Were  Quiet,   But  Beginning  And  End  Of 
Year  Found  Demand  Good  and  Prices  Rising. 


BY  C.  H.  BURGESS 

AS  mentioned  in  your  issue  of  last  year,  1921  opened 
with  a  brisk  demand  for  bonds  and  also  easier  call 
money,  witli  the  result  that  prices  advanced  very  decidedly 
until  about  the  end  of  March  when  a  halt  was  quite  notice- 
able in  the  demand  for  bonds,  and  from  that  lime  until 
August  there  was  a  comparatively  quiet  market  wHh  prices 
considerably  lower  than  they  were  in  the  early  part  of  the 
year.  The  latter  part  of  the  year  from  September  to  De- 
cember 31st,  was  marked  by  an  active  market  which  was 
heralded  in  advance  by  a  strong  demand  for  all  bonds  in 
New  York.  The  year  was  also  marked  by  bad  industrial 
conditions,  but  as  the  industrial  loans  with  Banks  which 
weri  "frozen"  began  to  thaw,  ^oney  became  easier  and 
bonds  advanced  from  5%  to  10%  in  a  short  time.  The 
rise  in  Sterling  Exchange  and  the  ease  of  money  in  the  Old 
Country  had  the  effect  of  making  bonds  dearer  in  England 
and  also  cutting  off  the  profit  in  exchange  obtainable  by 
shipping  the  bonds  here.  New  York  funds  were  very 
strong,  going  as  high  as  19%,  but  by  the  end  of  the  year 
they  were  down  again  to  about  5%.  The  premium  on 
American  Funds  opened  a  market  in  the  United  States  for 
our  securities.  The  Americans  received  vry  lucrativ  rates 
of  Interest,  our  best  Provincial  bonds  yielding  in  the 
United  States  from  7%  to  8%  according  to  maturity. 

Provincial   Borrowings 

The  Province  of  Ontario  this  year  was  the  largest  bor- 
rower, having  made  loans  to  the  extent  of  about  $50,000,- 
000    including   Treasury   Notes. 

The  City  of  Toronto  was  also  another  heavy  borrower, 
having  made  loans  to  the  extent  of  about  $28,000,000. 
The  Provinces  of  British  Columbia,  Alberta,  Saskatche- 
wan, Manitoba,  New  Brunswick  and  Nova  Scotia  all  came 
on  the  market  with  demands  for  money,  and  all  were 
taken  with  considerable  ease  at  the  very  attractive  rates 
obtainable.  The  City  of  Toronto  had  to  pay,  owing  to  the 
extraordinary  heavy  borrowings,  the  highest  rates  It  has 
paid  for  very  many  years. 

Bonds  were  selling  this  year  as  follows: — 

Maturity  Feb.  Aug.  Dec. 

Dec.    1,    1922     98.75  99.  99.50 

Nov.    1,    1923    98.  95.55  99.25 

Dec.   1,   1927    97.  98.10  99.50 

Nov.    1,    1933    98%  97.50        101.25 

Dec.    1,    1937    99.75  99.  103.50 


1919   Victory  Loan — 

Nov.    1,    1924     96.75  96.70  48.30 

Province  of  Ontario  Bonds 67.  6.25  5% 

Prov.  of  Saskatchewan  Bonds     6%  6.50  5.90 

Nov.    1,    1934     98.75  94.80  98.25 

Prov.  of  B.  C.  Bonds   ........    6.25  6.50  5.90 

Province   of   Alberta    Bonds    .  .    6.25  .6.50  5.90 

Province  of  Manitoba   Bonds.  .    6.20  6.40  5.80 

City  of   Toronto  Bonds    G%  6.50  5.75 

Ont.  smaller  cities  Bonds    ....    6%  6%  5.80 

Township    Bonds    6.25  6.50  5.90 

County    Bonds     6.  6.50  5.80 

Town     Bonds     6.25  6%  6. 

Village    Bonds    6.50  7.  6.25 

The  sale  of  Town  bonds  of  the  Provinces  of  Alberta  and 
Saskatchewan  has  been  practically  nil,  investot-s  not  having 
had  confidence  restored  since  the  large  number  of  d(;faults 
that  have  occurrd.  nl  th  case  of  the  Province  of  Alberta 
the  situation  is  somewhat  better,  but  it  is  practically  im- 
possible to  sell  any  Town  or  School  District  bonds  of  the 
Province  of  Saskatchewan. 

The  end  of  the  year  found  a  distinctly  rising  bond  mar- 
ket with  prospects  for  the  coming  year  of  much  cheaper 
money,  probably  a  smaller  supply  of  the  ordinary  issues 
of  bonds,  and  with  a  distinctly  improved  outlook  for  the 
market  in  the  United  States  which,  after  all,  is  the  con- 
trolling influence  in  the  Canadian  money  amrket  at  the 
presnt  time. 

Early  in  the  year  it  became  evident  that  a  General 
Eleciion  of  the  Federal  Government  would  necessarily 
take  place  this  year,  and  this,  coupled  with  other  condi- 
tions, mad  people  hesitate  as  to  what  move  they  would 
take  in  connection  with  launching  into  business  enter- 
prises. Elections  being  over,  things  at  the  end  of  the 
year  steadied  down.  Financial  people,  however,  are  look- 
ing with  a  good  deal  of  interest  to  the  financing  which  the 
Dominnion  Government  must  do  in  the  year  1922  in  order 
to  take  care  of  the  maturing  obligations  of  about  $198,- 
000,000  Victory  Bonds  due  in  December,  and  also  to  cover 
the  huge  overdrafts  that  they  have  with  their  bankers  ne- 
cessitated by  falling  revenues   during  th  yar   1921. 


Canada's  potato  crop  for  the  past  season  amounted  to 
110,895,000  bushels,  a  decrease  from  the  1920  yield  of  22,- 
936,400  J)ushels,  according  to  the  Dominion  Fruit  Coinmis- 
sioner's  November  report.  Much  of  this  decrease,  says  the 
report,  was  due  to  the  fact  of  82,632  acres  less  than  last 
year  having  been  planted.  Another  factor,  however,  was 
the  long  spell  of  hot,  dry  vsreather  which  was  experienced 
early  in  the  season. 


January   B,   1922.  THEMONETARYTIMES  6J 


DIRECTORS  AND  OFFICERS  OF  THE 

Union  Trust  Company 

LIMITED 
Richmond  and  Victoria  Streets,  TORONTO 

DIRECTORS 

IIKNRY   F.   GOODERHAM  President.  Union  Trust  Company.  Limited. 

J.   H.    McCONNKLL,   M.D.  Toronto.  Ont. 

MARK  BREDIN  ITes.  and  Gen.  Mgr.  Can.  Bread  Co.  Ltd.,  Toronto. 

WALTER   C.   LAIDLAW  Sec.-Treas.,  R.  Laidlaw  Lumber  Co.,  Ltd..  Toronto. 

LT.-COL.  M.  ROSS  GOODERHAM  Rlackatock,  Gait.  Gooderham  &  Co.,  Toronto. 

S.  R.  PARSONS  Pres.,  British  American  Oil  Co.,  Ltd.  Toronto. 

JOHN  B.   LAIDLAW  Mgr.,  Norwich  Union  Fire  Ins.  Society,  Toronto. 

A.    PERCY   TAYLOR  President,   Soaps-Perfumes,   Ltd.,   Toronto. 

W.    H.    SMITH  Oakville,   Ont. 

GEORGE  S.  MAY  George  May  &  Sons.  Ottawa. 

H.    H.    BECK  Director,  Empire  Loan  Co..  Victoria.  B.C. 

RIGHT  HON.  LORD  HINDLIP  Capitalist,  Worcester,  England. 

.Ari)IT()R.S   —    PRICE.   WATERHOUSB  &   CO. 

OFFICERS 

JiENRY   F.   GOODERHA.M.    President 
J.  H.  McCONNELL,  M.D..  Vice  President.    JAMES  K.  PICKETT.  General  Manager. 
C.  D.  HENDERSON,  Secretary.  D.  W.  LANG,  Trust  Officer. 

H.    PATERSON,   Assistant   Secretary.  G.   E.   BUCHANAN,   Assistant  Secretary. 

The  Htrongth  of  the  Union  Trust  Company  is  h  trii)ut«  to  the  good  Judgment  and  progreMive  spirit  of  the 
nion  who  dirwt  Its  affairs.  I'lulor  their  |5iil(lan<-o,  the  Company  has  attaincil  i(.s  pro>H>nl  high  |Kmilion  in  iho 
<;  iiiniiinity.  Voii  may  be  assured  lliat  your  business,  entrusKHl  to  this  ConipAiiy,  will  l>e  under  thp  dir*'Ofl«n 
of  men  of  int«>>vrity  and  experience. 


Canadian  Financiers  Trust  Company 

INCORPORATED   1907 


Government^  Municipal  and  Corporation  Bonds 

To  Yield  5.90  '  to  IVz^ 

For  Investment 


We  have  a  very  complete  list.     Before  investing  secure  particulars  of  our  offerings. 


Communicate    with    us   for     all    Trust    Agencjf 
and  Investment  business  in   British    Columbia. 


HEAD  OFFICE  -  -  VANCOUVER,  B.  C. 

General  Manager:      LIEUT. -COL.   G.   H.   DORRELL 


62 


THE      MONETARY      TIMES 


Volume  68. 


1921  BANK  CLEARINGS  BY  CITIES— MONTH  BY  MONTH 


January, 

Clearing  House.  1921 

Brandon ?3,025,132 

Brantford 6,032,193 

Calgary 33,866,122 

Edmonton 22,179,390 

Fort  William 4,267,983 

Halifax 17,287,952 

Hamilton 26,290,242 

Kingston 

Kitchener 4,059,420 

Lethbridge 3,023,975 

London 15,082,624 

Medicine  Hat 2,082,823 

Moncton 4,178,237 

Montreal 494,702,024 

Moose  Jaw 6,777,067 

New  Westminster 2,432,749 

Ottawa 35,298,519 

Peterboro 3,888,379 

Prince  Albert 1,996,653 

Quebec 25,915,954 

Regina 17,621,104 

St.  John 12,929,720 

Saskatoon 8,455,627 

Sherbrooke 4,805,860 

Toronto 414,365,319 

Vancouver 58,553,665 

Victoria 10,687,103 

Winnipeg 234,762,892 

Windsor 12,685,093 

Total 11,485.075,584 

July 

Clearing  House  1921 

Brandon $3,166,105 

Brantford 4,781,444 

Calgary     23,871,791 

Edmonton 18,760,263 

Fort  William 3,446,027 

Halifax 14,520,006 

Hamilton 24,374,555 

Kingston 3,414,867 

Kitchener 4,352.014 

Lethbridge 2,555,723 

Londsn     12,251,853 

Medicine  Hat 1,673,275 

Moncton     4,805,281 

Montreal 487,967,909 

Moose  Jaw     5,927,532 

New  Westminster     2,599,087 

Ottawa 29,242,987 

Peterboro 3,546,742 

Prince  Albert 

Quebec 25,629,822 

Regina 15,944,599 

St.  John 13,486,603 

Saskatoon 7,817,146 

Sherbrooke 4,312,623 

Toronto 400,200,129 

Vancouver     59,571,725 

Victoria 10,324,988 

Winnipeg 169,100,232 

Windsor 16,351,204 

Total     11,365,276,384 


February, 

March, 

April, 

May. 

June, 

1921 

1921 

1921 

1921 

1921 

$2,611,496 

$2,816,816 

$2,929,937 

$2,934,342 

$3,073,132 

4,905,499 

5,338,434 

5,428,446 

5,242,890 

5,233.319 

24,790,795 

27,805,902 

28,807,613 

29.292,347 

29,191,283 

18,503,237 

19,756,251 

20,862,182 

21,710,239 

20,399,749 

3,464,679 

3,706,311 

3,434,932 

3,434,722 

3,302,643 

13,520,684 

14,542,134 

17,331,632 

14,680,275 

14,833,546 

21,962,250 

24,751,828 

26,909,887 

27,189,232 

26,626,534 

2,951,976 

3,371,689 

3,627,014 

3,278,049 

3,472,010 

3,935,101 

4,359,426 

4,706,274 

4,675,626 

2,403,892 

2,534,800 

2,728,601 

2,872,822 

2,861,090 

11,420,183 

13,670,567 

15,492,670 

14.820.167 

14,460,931 

1,556,627 

1,636,919 

1,765,326 

1,795,825 

1,908,119 

4,337,519 

5,435,417 

4,945,821 

5,062,077 

4,795,857 

•    437,822,619 

455,162,615 

491,649,265 

524,180,212 

502,810,816 

4,875,828 

5,666,699 

5,677,317 

5,280,312 

5,814,188 

2,441,207 

2,529,194 

2,578,160 

2,692,383 

2,663,876 

29,988,218 

39,831,566 

34.279,406 

44.149,862 

37,835,083 

3,378,990 

3,999,768 

4.201,823 

4,240,756 

3,686,253 

1,284,255 

1,588,688 

1,525,718 

23,155,877 

26,113,776 

27,193,361 

26,761,706 

25,441,288 

13,601,611 

15,279,167 

15,777,702 

15,177,637 

16,006,003 

10,841,239 

11,813,280 

12,298,510 

12,895,853 

11,715,251 

6,722,875 

7,950,953 

7,895,360 

7,306,075 

7,517,779 

4,293,446 

4,813,461 

5,158,670 

5,557,345 

4,766,622 

408,802.335 

403,675,308 

433,936,360 

435,881,087 

444,487,229 

53,218,954 

57,437,770 

63,126,307 

59,535,348 

57,920,556 

9,410,534 

9,785,899 

10,580,984 

10,005,067 

11,422,688 

175,892,853 

168,941,168 

206,396,710 

217,565,851 

199,743,828 

11,287,194 

11,835,218 

14.407,894 

14,283,487 

14,170,259 

11,305,629,387 

$1,336,919,593 

$1,466,734,199 

$1,515,202,116 

$1,472,567,721 

August 

September 

October 

November 

December 

1921 

1921 

1921 

1921 

1921 

$3,891,453 

$3,562,319 

$3,942,402 

$3,830,300 

$3,499,289 

4,273,167 

5,059,506 

5,347,329 

5,587,192 

5,006,172 

24,017,889 

26,944,524 

31,031,896 

29,053,282 

26,791,758 

22,719,053 

22,393,455 

24,923,580 

25,018,310 

23,062,906 

3,083,012 

3,479,562 

3,882,944 

4,080,614 

4,036,532 

14,727,255 

13,345,726 

13,824,949 

18,061,518 

15,126,915 

22,745,184 

22^643,531 

24.125,253 

25,409,422 

24,903,809 

3,350,429 

3,276,742 

3,408,917 

3,425,799 

3,767,218 

3,970,279 

3,863.633 

4,449,496 

4,905,336 

4,563,587 

3,680,526 

3,167,270 

3,339.068 

3,003,727 

3,179.239 

11,308,351 

11,475,785 

13,415,730 

13,924.009 

14,634,090 

1,594,335 

1,731.076 

2,331,978 

1,873,275 

1,898,946 

4,670,556 

4,543,724 

4,605,088 

4,587,731 

4,255,525 

428,570,828 

417,352,371 

441,519,625 

506,188,587 

521,331.302 

6,125,480 

6,337.760 

7,469,343 

7,722,677 

7,064,998 

2,536,772 

2,457,956 

2,766,621 

2,454,037 

2,583,023 

27,026,163 

27,898,003 

30,185,024 

40,060,940 

36,441,913 

3,280,962 

3,460,228 

3,394,803 

3,571,519 

3,645,293 

1,573,076 

1,834,059 

1,729,825 

24,803,325 

23,623,912 

24,037,274 

25,476,998 

24,348,195 

14,382,078 

17,274,935 

20,173,021 

20,323,111 

19,229,502 

11,851,592 

11,832,331 

11,630,479 

13,466,948 

12,539,863 

8,844,944 

8,383,916 

10,288,039 

10,250,949 

9,119,521 

5,009,051 

3,663,637 

3,661,429 

3,857,359 

3,742,202 

371,967,490 

379,360,589 

459,625,955 

484,870,224 

464,721,741 

61,466,583 

60,788,234 

58,591,205 

59,423,687 

58,571,898 

10,132,351 

9,368,854 

10,604,143 

9,416,088 

10,677,540 

178,302,483 

231,934,636 

309,092,170 

321,081,483 

269,626,797 

13,889,156 

12,777,288 

13,076,478 

14,090,468 

13,610,688 

$1,288,870,318  $1,338,714,761  $1,542,908,398  $1,663,423,850  $1,593,710,287 


CANADIAN  BANK  CLEARINGS  BY  PROVINCES 

1915  1916  1917  1918  1919  1920  1921 

Ontario  $2,411,073,625  $3,240,773,729  $3,792,647,962  $4,326,431,476  $5,479,295,137  $6,904,908,623  $6,371,820,534 

Quebec  .'. 2,786,449,334  3,939,152,266  4,435,709,612  5,114,234,344  6,595,339,437  7,540,531,459  6.065.401,366 

Manitoba    1,557,815,247  2,040,717,775  2,653,354,314  2,395,388,507  2,.S53,647,032  3,057,452,638  307,526,833 

British  Columbia..        371,713,657  415,797,842  521,913,559  670,405,480  804,018,563  1,061,107,104  861,357,236 

Alberta    308,837,076  400,762,688  566,007,431  568,848,622  650,034,151  805,818,885  652,953,074 

New   Brunswick....          77,058,264  90,946,795  102,948,814  117,133,609  153,139,927  193,761,263  203,524,002 

Nova  Scotia  104,414,590  125,997,881  151,812,753  215,259,297  241,300,194  255,678,397  181,802,592 

Saskatchewan   188,526,217  255,347,0j2  340,238,760  368,631.391  424,504,941  464.296.936  387,615,129 

Total  $7,805,888,010  $10,509,496,068  $12,564,633,205  $13,776,332,726  $16,701,279,382  $20,283,555,305  $15,032,000,766 


January  6,  1922. 


THE      MONETARY      TIMES 


The  Standard   Bank 


OF  CANADA 

Established    1673 


Capital  paid  in 

Surplus  and  Undivided  Profits 

Resources  ... 


5  4,000,000.00 

5,300,000.00 

84,000,000.00 


COMPLETE  BANKING  FACILITIES  I- OR  THE  FARMER,  MANUFACTURER, 

MERCHANT   AND     INDIVIDUAL 


178  Branches  throughout  Canada 

WELLINGTON  FRANCIS,  K.C., 

President. 


Correspondents  in  all  Countries 

C.  H.  EASSON, 
General  Manag^er. 


yiiiiiiiiiiiiiiiiiniiiiiiitiiiil iiiiiiii|[iiii[iili»ii!iii!iiiiiiiiiiiiiiii!iiit!iiiiiiiiiiiiiiiiiiuiiiniiiiiiiiiiiiiiiiiiiiiiiiiiuiniiiiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiimimj; 

I     gniiiiiNiitiuiiiiiiiiiniiiiiiiiii{i{iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiuiiiiiiiiiiiiiiiiniiiiiiiii!iui:iiiiiitiiiiiiiiiniiiiiiiii{ii{iin^^  | 

I    I  Satisfactory  Service  Guaranteed  i  | 

j  Prudential  Trust  Company  Ltd.  I 

j  Trustee         Executor         Administrator 

I  and  in  all  other  Trust  Capacities. 

Real  Estate  and  Insurance  Departments 

B.   HLAL  U1U)\V\, 

President  and  Gt-neral  Manager 

J.  P.  STEEDxMAN, 

Vice-President 

Toronto  Branch  :  Kent  Building 

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(Xlior 


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64 


THE       MONETARY       TIMES 


Volume  68. 


QUOTATIONS  OF  INTERNATIONAL  EXCHANGE 

(Supplied  by  the  Foreign  Department,  Canadian  Bank  of  Commerce) 


Months 
and  Year. 


1921. 
January    . . 
February. 
March  .  .    . . 
April   . .    . . 
May    . .    . . 
June   . .    . . 
July   .... 
August    . . 
September. 
October    . . 
November. 
December  . 


New  York  Funds 

Demand 

(France) 

Francs 

(Holland) 

(Italy) 

Lire 

(Norway) 

in   Canada 

Sterling 

(Cents  per  franc) 

Guik 

ers 

(Cents  per  lira) 

Kroner 

High. 

Low. 

High. 

Low. 

High. 

Low.    , 

High. 

Low. 

High. 

Low. 

High. 

Low. 

(Premium) 

18 

10 

389.13 

353.13 

7.33 

5.83 

34.00 

31.35 

3.81 

3.41 

19.75 

15.00 

15^s 

11% 

392.00 

380.00 

7.50 

6.89 

34.87 

33.87 

3.73 

3.62 

18.65 

17.25 

14% 

12  ft 

393.87 

385.13 

7.28 

6.91  V2 

34.60 

34.05 

4.20 

3.64 

17.10 

15.65 

13% 

12% 

397.00 

388.25 

7.751/2 

6.97 

35.00 

34.45 

4.93% 

4.08 

16.20 

15.62 

12tt 

10% 

400.37 

386.13 

8.80 

7.77 

36.30 

34.54 

5.67 

4.79 

16.66 

15.25 

14  7-32 

mg 

391.50 

370.25 

8.49 

7.80 

34.53 

32.78 

5.31 

4.77 

15.92 

14.25 

14% 

12  9-32 

373.50 

354.87 

8.02 

7.55 

32.85 

30.70 

4.92 

4.1714 

14.20 

12.76 

12  9-32 

10% 

372.67 

355.75 

8.01 

7.62 

31.59 

30.50 

4.54 

4.21 

13.79 

12.65 

121/4 

913 

375.00 

368.37 

7.89 

6.92 

32.15 

31.33 

4.59 

4.04% 

13.71 

12.33 

10% 

8% 

396.50 

371.87 

7.47 

7.07 

34.90 

31.79 

4.07 

3.89 

13.35 

12.10 

10 

8A 

400.75 

390.75 

7.41 

6.89 

35.83 

34.00 

4.22% 

4.03% 

14.57 

13.55 

9  ¥4 

i% 

424.00 

401.25 

8.36 

7.18 

36.85 

35.41 

4.81 

4.17 

15.99 

14.21 

Condensed  Advertisements 


BOND  SALESMEN  WANTED 

To  sell  Dominion,  Provincial  and  Municipal  Bonds  direct 
to  ultimate  investors  in  Ontario.  Men  with  banking  experi- 
ence desired  who  are  well  acquainted  with  one  or  more 
districts.  This  is  a  splendid  opportunity  for  ex-bank  man- 
agers and  for  bank  men  to  whom  the  investment  field 
appeals,  as  a  scope  for  their  training  and  ability.  Box  443, 
Monetary  Times.  Toronto. 


LES   OBLIGATIONS    BELGES   A   4   P.C.    EMISES 
RECEMMENT 

et  garanties  par  le  GOUVERNEMENT  offrent   un  plan  <le 
tirage  oxoeptlonnel lenient  avantageux. 

8  occasions  se  presentent  chaquo  annee  de  gagner 

UN  MILLION  DE  FRANCS 

3  primes  de  1,000,000  de  francs  chacune  et  plusieurs 
autres  moindres  seront  tirus  le  15  avril  prochain. 

Le  prix  de  I'obligation  est  de  CINQ  GUINEES  comptant. 
On  peut  se  procurer  les  obligations  a  termes  faciles  (dix 
schellings  par  mois  si  on  le  desire). 

Pour  renseignements  complets,  ecrire  a  la 
NATIONAL  BOND  CORPOBATION 
12  Upper  Camden  Street,  Dublin,  Ireland 

729 


ANDREW    SIIARI".    A.H.I.B.A. 


IIF.ItltEItT    HOItNKII 


SHARP  AND  HORNER 

ARCHITECTS 
TORONTO 


MUrr.M-    LIFE 

ASSCF. 

Waterloo 


OFFICES     AT 

75  King  St.  West 
TORONTO 


U.iNK  OF  MJVA 

.SCOTIA 

Charlottetown 


r 


DISTINCTIVE    DESIGN    AND    EFFICIENT 
ADMINISTRATION 


Dividend  Notices 


DOMINION  TEXTILE  COMPANY,  LTD. 

A  dividend  of  one  and  three-quarter  per  cent.  (1%%) 
on  the  Preferred  Stock  of  the  DOMINION  TEXTILE  COM- 
PANY LIMITED  has  been  declared  for  the  quarter  ending 
31st  December.  1921,  payable  JANUARY  16TH,  1922,  to 
shareholders  of  record  JANUARY  3RD,  1922. 
By  order  of  the  Board, 

JAS.  H.  WEBB, 

Secretary-Treasurer. 
Montreal.  28th  December,  1921.  780 


Debentures  for  Sale 


CITY  OF  MOOSE  JAW 

Sealed  tenders  endorsed  (Tenders  for  Debentures)  will 
be  received  by  the  City  Commissioners  up  to  noon  of  the 
twenty-first  (21st)  day  of  J.muary,  1922,  for  twenty-nine 
thousand  eight  hundred  and  twelve  dollars  and  fifty-eight 
cents  ($29,812.58)  debentures  for  the  purpose  of  capital- 
izing the  arrears  of  school  taxes  on  lands  acquired  by  the 
city  under  the  arrears  of  taxes  act.  Debentures  to  be  issued 
on  the  sinking  fund  plan,  repayable  in  five  (5)  years  from 
the  date  of  the  issue  therefor,  with  interest  at  six  and  one- 
half  per  centum  (GVz'/t  )  per  annum,  payable  semi-annually. 
The  highest  or  any  tender  not  necessarily  accepted. 

W.   F.    DUNN, 

Mayor. 
GEO.   D.   MACKIE, 

City    Commissioner. 
Moose  Jaw,  Sask.  779 


ONTARIO  MINING  PRODUCTION 


The  outstanding  feature  of  the  Ontario  Department  of 
Mines'  returns  for  the  nine  months  ending  September  30, 
1921,  is  the  growing  importance  of  Ontario's  gold  mining 
industry.  "Provided  the  output  for  the  last  quarter  equals 
that  of  the  third  quarter,"  says  the  report,  "Ontario's  gold 
production  for  1921  will  be  approximately  $13,870,000,  and, 
with  the  premium  added,  $15,200,000." 

Not  only  does  Ontario  lead  the  Canadian  provinces  in 
gold  output,  but  it  is  quite  probable,  states  the  report,  that 
this  year  Ontario  will  have  a  production  exceeding  that  of 
California. 


January  6,  1922 


THE       MONETARY      TIMES 


M 


The  DOMINION  BANK 


ESTABLISHED  1871 


Capital  Paid  Up 

Reserve  Fund  and  Undivided  Profits 


$6,000,000 
$7,500,000 


Iiondon,    England 

Branch 
78  Cornhlll,  E.O.  » 

S.   Ij.   JonoN, 

Manager 


Nir   Kiliiiund   It.   Osier,  President 

A.  VV.  AuNtln  ^ 

Sir  Augustus  M.  Nanton  |  Vlce-PrcsJdenU 


Xew    York    Ajcency. 
lit    Broadway 

C.   8.   Howard, 

Agent 


HEAD  OFFICE  OF   THE   DOMINION    BANK,    TORONTO 


CLAKKNCE  A.  ItOGKKT.  GENERAL  MANAGER. 


THE       MONETARY       TIMES 


Volume  68 


The  Growth  of  Rural  Credits  in  Canada 

Provinces  Are  Occupying  This  Field  —  Manitoba  System  Has 
Been  in  Operation  for  Some  Time — Saskatchewan  Makes  Long 
Term  Loans — Other  Provinces  Taking  Steps  to  Finzmce  Farmers 


By  W.  T.  JACKMAN 

Department  of   Political  Economy,  University   of  Toronto. 


CANADA,  unlike  the  United  States,  has  no  national  legis- 
lation under  which  to  furnish  advances  to  those  en- 
gaged in  agriculture.  It  has  been  left  to  the  several  prov- 
inces, therefore,  to  make  provision  for  those  within  their 
own  boundaries.  As  agriculture  is  rapidly  becoming  a  busi- 
ness, involving  the  application  of  business  principles  and 
practices,  it  is  necessary  to  provide  fbr  those  engaged  in  it 
such  facilities  for  borrowing  as  will  enable  them  to  have 
their  credit  requirements  satisfied  according  to  their  needs. 
In  all  countries  it  is  i-ecognized  that  the  commercial  bank- 
ing systems  are  not  adapted  to  the  special  conditions  of 
agriculture,  and,  consequently,  there  have  come  into  opera- 
tion institutions  for  meeting  these  requirements  for  rural 
credit.  A  brief  description  of  these  organized  facilities  will 
show  what  has  been  done  by  the  different  provinces. 

Manitoba 

The  short-term  requirements  are  cared  for  under  the 
Rural  Credits  Act,  which  was  passed  in  1917  and  amended 
at  a  later  time.  This  Act  makes  provision  for  the  organ- 
ization by  farmers  of  rural  credit  societies,  through  which 
the  individual  shareholders  of  these  societies  may  be  en- 
abled to  borrow  for  productive  purposes.  The  organization 
of  such  a  society  is  initiated  by  not  less  than  fifteen  farmers 
drawing  up  a  petition  therefor,  addressed  to  the  Lieutenant- 
Governor-in-Council.  The  petition  contains  the  names  and 
addresses  of  the  petitioners,  the  lands  occupied  by  them, 
the  amounts  subscribed  by  each  to  the  capital  of  the  pro- 
posed society,  the  amount  of  the  capital  stock,  the  number 
of  shares  into  which  it  is  divided  and  the  amount  paid  on 
each  subscription.  When  he  is  satisfied  in  regard  to  the 
petition,  the  Provincial  Secretary  may  issue  letters  patent 
Incorporating  the  society.  No  society  can  commence  busi- 
ness until  it  has  received  subscriptions  to  its  capital  stock 
from  at  least  thirty-five  persons  actually  engaged  or  agree- 
ing to  engage  within  one  year  in  farming  operations.  Each 
member  of  a  society  must  subscribe  for  at  least  one  share 
of  stock,  and  10%  must  be  paid  on  all  subscriptions  before 
the  society  can  undertake  business. 

The  Provincial  Government  and  the  municipality  sub- 
scribe each  for  one-half  as  much  stock  as  the  total  farmers' 
subscriptions,  and  they,  too,  like  the  farmers,  must  pay 
10%  on  their  subscriptions.  The  board  of  directors  of  a 
society  is  composed  of  nine  members,  three  elected  by  the 
farmer  subscribers,  three  by  the  municipal  council  and 
three  by  the  Provincial  Government.  One  of  the  latter  must 
be  an  officer  of  the  government  devoting  his  time  to  agri- 
cultural work  or  instruction,  and  he  is  usually  appointed  on 
ten  or  more  rural  credit  society  boards  in  the  locality,  to 
Insure  uniformity  and  thoroughness  in  the  management  of 
the  societies.  The  secretary-treasurer  is  the  only  paid 
officer  of  the  board;  the  others  receive  only  their  expenses. 

How   Loans  Are   Granted 

The  board  of  directors  of  a  society  meets  two  or  three 
times  a  year,  usually  during  the  first  four  months  of  the 
year.  Any  member  desiring  a  loan  makes  application  to  the 
secretary,  stating  the  purposes  of  the  loan  and  submitting 
a  statement  of  his  assets  and  liabilities.  If  the  application 
is  approved  he  is  granted  a  line  of  credit  tor  a  year,  and 
all  the  borrower's  personal  property,  purchased,  partly  pur- 
chased or  to  be  purchased  with  the  proceeds  of  the  loan, 
and  all  the  returns  from  the  investment  of  the  loan,  are 
thereby   made   subject   to   a  lien   in   favor   of   the   society. 


Moreover,  none  of  this  personal  property  of  the  borrower 
can  be  sold  or  removed  from  his  premises  during  the  con- 
tinuance of  the  loan  without  the  consent  of  the  secretary 
of  the  society.  All  proceeds  from  the  sale  of  any  of  this 
property  must  be  applied  without  delay  towards  the  repay- 
ment of  the  loan.  The  lender  of  the  money  has  not  only 
this  individual  security,  but  also  the  guarantee  of  the 
society  which  approved  the  loan,  so  that  little  risk  Is 
assumed  in  making  the  loan.  The  society,  too,  Is  protected 
by  the  provision  that,  if  the  loan  should  become  unsafe, 
or  the  borrower  should  do  anything  contrary  to  the  loan 
contract,  the  amount  of  the  loan  shall  become  due  and  pay- 
able, and  the  society  may  take  possession  of  all  property 
on  which  it  has  a  lien  and  sell  it  in  satisfaction  of  its  claim. 

The  rate  of  interest  payable  by  the  borrower  on  such 
a  loan  must  not  exceed  7%  per  annum,  and  out  of  the  Inter- 
est paid  to  the  lender  one-seventh  must  be  returned  to  the 
society.  In  case  the  borrower  should  not  be  able  to  repay 
the  amount  of  his  loan  by  the  last  day  of  December,  the 
directors  of  the  society  may,  upon  sufficient  reason,  renew 
the  loan  for  an  additional  period  of  not  more  than  one 
year,  but  it  must  be  clearly  understood  that  the  l(5an  must 
be  for  one  or  more  of  the  productive  purposes  specified  in 
the  Act. 

The  rural  credit  society  must  invest  the  amount  of  its 
paid-up  capital  in  government,  municipal  or  school  bonds. 
The  returns  from  this  investment,  together  with  the 
society's  share  of  the  interest  paid  by  its  borrowers,  must 
be  used  to  defray  the  necessary  expenses  of  the  society, 
after  which  a  dividend  not  to  exceed  6%  per  annum  may  be 
disbursed  on  the  paid-up  stock,  and  the  remainder  must  be 
transferred  to  a  reserve  fund. 

Source  of  the  Funds 

Up  to  March,  1920,  the  funds  for  these  loans  came  from 
the  banks,  which  furnished  the  advances  to  the  societies  at 
6%,  and  the  societies  charged  the  borrowers  7%.  At  that 
time  the  banks  refused  to  make  further  loans  to  the  societies 
for  less  than  6%%  interest.  This  was  not  acceptable,  and 
the  Government  shortly  afterwards  opened  the  Provincial 
Savings  Office  to  obtain  money  for  the  rural  credit  loans. 
This  office  and  its  branches  accept  deposits,  upon  which 
4%  interest  is  paid,  and  the  Government  guarantees  the 
deposits.  The  Savings  Office  was  opened  in  July,  1920,  and 
by  September,  1921,  there  were  6,500  depositors  and  $3,000,000 
of  deposits. 

The  long-term  or  mortgage  credit  is  provided  in  Mani- 
toba through  an  Act  passed  in  1917,  which  created  the  Mani- 
toba Farm  Loans  Association  to  act  as  the  loaning  agent 
between  the  Government  and  the  farmers.  Its  affairs  are 
managed  by  a  board  of  five  members  appointed  by  the 
Provincial  Government.  The  capital  stock  of  the  associa- 
tion is  $1,000,000,  divided  into  200,000  shares  of  $5  each. 
None  but  borrowers  and  the  Government  can  own  shares 
in  the  association.  Every  borrower  must  subscribe  and  pay 
cash  for  shares  of  stock  in  the  association  equal  to  5%  of 
the  amount  of  his  loan.  All  loans  made  by  the  association 
must  be  secured  by  a  first  mortgage  which  must  be  repaid 
on  the  amortization  plan.  All  mortgages  are  taken  for  a 
30-year  period,  but  a  loan  may  be  paid  off  at  any  annual 
payment  date^at  or  after  the  end  of  five  years  from  the 
date  of  the  mortgage.  Loans  granted  must  not  exceed  50% 
of  the  fair  estimated  value  of  the  land  and  Improvements, 
and  the  maximum  loan  to  any  person  is  $10,000.    The  specific 


January  6,  1922 


THE       MONETARY       TIMES 


tr 


BANK    OF    NEW    ZEALAND 

KSTAilLISIlKDIN     1861 
ItankerN  to  the  («<)V<!i-niii<'iit  of  New  Xi-alund,  wli  jrli    li.;lils    IVi-frri'iK-o    SharirH    In    Ihp    llank    for 

$5,474,812,   anil   KUai'ant<H;H   its   ReliM-nialtIc  Ktoi  k   82,579,186. 

Paid-up  Capital  ($19,003,624)  and  Reserve  Fund  ($7,421,412)  $26,425,036 

Undivided  Profits              .....  1,758,144 

Aggregate  Assets  at  31st  March,  1921             -           -  242,189,207 

BOARD  OF  DIRECTORS: 


WELLINGTON.  N.Z. 

(Four  are  appointed  i)y 
New  Zealand  (Jovern- 
ment :  two  eliM^ted  bv 
Ordinary  Shareholder") 

H.   BEAUCHAMP, 

(Chairman) 

GEORGE  ELLIOT 
R.  W.  KANE 
WM.  REECE 
J.  H.  UPTON 
WM.  WATSON 


LONDON     BOARD 

P'redk.  Lubbock, 

(Chairman) 

The  Rt.  Hon.  Lord 

Camock,   G.C.B. 

Alex.   Michie 

Sir  James  Mills, 

K.C.M.G. 


HEAD     OFFICE 

WELLINGTON,    NEW    ZEALAND 


General   Manager:    H.   Buckleton. 


LONDON    OFFICE 

1,  Queen  Victoria  Street,  E.G.  4 

Manager:   Alexander  Kay. 

AUDITORS:      (Appointed  by  New  Zealand  Government) 
Richd.   W.   Gibbs,   Vhiet  Auditor  w.  C.  Sneath  (Price  Waterhouse  &  Co.).  London  Auditor. 

THE  BANK  OF  NEW  ZEALAND  ha.s  Branches  or  Agencies  in  all  the  principal  cltle«  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  Hank  has  faclli(i<>s  for  conduoting  every  description   of   Hanking   business. 

The  Hank  negotiates  at  any  of  its  Branches  Bills  d  laxvn  in  dollars  under  .\uierican  Oedils  as  well  an  those  in 
sterlins,  and  it  invites  the  (wtiiblishment  of  such  Credits.    It  also  issues  Drafts  or  Credits  either  in  dollars  or 
ling,  on  any  of  the  principal  cities  in  North  America. 

Chief  Agents  in  Canada: 

CANADIAN  BANK  OF  COMMERCE  BANK  OF  MONTREAL 


Aniei-i<an  Express  Ctimpany 
Bank  of  Nova  Scotia, 


Imperial  Bank  of  Canada, 
Hoyal   Bank  of  CaniMla. 


Other  Agents  and  Correspondents  in  Canada 
Dominion   Hank, 
Dominion   Express  Company,   Toronto. 

Chief  Agents  in   Xe«   York:     IRVING     NATIONAL    BANK 

Chief  Agents  in  San   Francisco 

FIRST  NATIONAL  BANK  OF  SAN  FRANCISCO 

other  Agents  and   Correspondents  in  United  States: 


American  Rxchango  National  Bank. 
New  York. 

.Vmerican  Express  Company. 

Bankers'  Trust  Company,  Now  York. 

Bank  of  Bishop  &  Company.  Hono- 
lulu. 

Hank  of  Italy. 

Hank  of  IMontreal. 

Hank  of  Nova  Sj-otia. 

Brown  Brothers  and  Company. 
Ho.Hton. 

<*aiiadlan    Itank   of   Commerce. 

Chartered  Bank  of  India,  Austridia 
*  China. 

Chase  National  Bank,   New  York. 

Columbia  Trust  Company.  New  York. 

Crocker  National  Bank  of  San 
Francisco. 

Drexel    and    Company,    riiiladelpbia. 


F(|uitable     Trust     Ctmipany   of     New 

York. 
Farmers  &  Merchants  National  Bank, 

Los  Angeles. 
Farmers     Ijoan    &     Trust     Company, 

New  York. 
First  National  Btvnk  of  Boston. 
First   National    Bank   of  Chicago. 
Greenebaum  Sons  Bank  &  Trust  Co. 

Chicago. 
Guaranty    Trust    Company    of    New 

York. 
Hanover   National   Bjink   of   the   City 

of  New  York.  • 

Hongkong      &      Shanghai      Banking 

Corpn. 
Illinois  Trust  *  Savings  Bank,  Cliic- 

ago- 
International     Banking    Cortioration. 


the    Americas, 


Klercantile     Bank    of 

New  Orleans. 
Mercantile  Trust   Co..  St.   I>ouis. 
Merchants  National   Bank  of  Boston. 
Morgan   *   Co..  J.P..   New  York. 
National     Bank     of     CommercA.     St. 

l..ouis. 
National   l^tnk   of  South   .Africa  litd. 
National   <Mty   Bank  of   New  York. 
National  Park  Bank  of  New  York. 
National   Shawmut  Bank,   Boston. 
NoMhern  Trust  Company,  (liicago. 
Philadelphia   National   Bank. 
Biggs   National   Bank  <if  WashlSKtoa 

I).  C. 
Koyal   Bank  of  Canada. 
.Sianilard   Hank  of  South  Africa  Ltd. 
Walker  Hros..  Salt  Ijkke  Oily. 
Yokohama  S|><-<'ie  Bank.  Umlted. 


68 


THE       MONETARY      TIMES 


Volume 


purposes  for  which  loans  may  be  made  are  set  out  in  the 
Act. 

The  funds  required  for  such  loans  were  obtained  at  first 
from  the  provincial  treasury.  But,  in  addition,  the  board 
was  authorized  to  sell  5%  bonds  up  to  90%  of  its  first  mort- 
gages, which  are  used  as  collateral  security.  These  bonds 
must  not  exceed  in  the  aggregate  $9,000,000,  and  the  princi- 
pal and  interest  are  guaranteed  by  the  government.  At  the 
last  session  of  the  legislature,  the  interest  rate  on  the  asso- 
ciation's bonds  was  increased  from  5%  to  6%,  so  as  to  enable 
the  board  to  borrow  enough  money  for  its  purposes.  This 
change  made  it  necessary  to  increase  the  rate  to  the  bor- 
rower from  6%  to  7%.  Coincident  with  the  change  of  the 
rate  of  interest  there  was  the  annulment  of  the  provision 
that  borrowers  had  to  subscribe  for  stock  in  the  association 
to  the  extent  of  5%  of  their  loans.  As  a  result  of  the 
operation  of  this  Act,  up  to  the  end  of  February,  1921,  the 
loans  made  aggregated  $5,039,150. 

Saskatchewan 

In  Saskatchewan  there  has  never  been  any  legislation  for 
the  establishment  of  short  term  credits  for  farmers,  al- 
though there  has  been  recently  a  very  strong  desire  for 
some  such  system  as  that  in  Manitoba. 

For  providing  long  term  or  mortgage  credit,  there  was 
passed  in  1917  "An  Act  to  provide  for  Loans  to  Agricultur- 
ists upon  the  Security  of  Farm  Mortgages."  This  legislation 
follows  closely  the  corresponding  Act  In  Manitoba,  the  only 
significant  differences  being: 

(1)  No  maximum  was  stated  for  any  individual  loan. 

(2)  All  the  money  for  the  board's  purposes  was  to  be 
provided  by  the  sale  of  provincial  bonds,  but  the 
total  amount  to  be  borrowed  must  not  exceed 
$5,000,000. 

(3)  The  first  mortgages  received  by  the  board  were  to 
be  handed  to  the  provincial  treasurer  at  least  equal 
in  value  to  and  as  security  for  the  loans,  and  the 
bonds  upon  which  the  money  was  borrowed  by  the 
treasurer  must  not  exceed  the  aggregate  of  the  mort- 
gages held  by  the  board.  (In  Manitoba,  the  bonds 
issued  by  the  board  must  not  exceed  90%  of  the 
amount  of  the  mortgages.) 

In  the  three  years  1917-1920  the  treasurer  was  able  to 
find  $6,500,000  for  the  Farm  Loan  Board,  and  this  amount 
had  been  loaned  to  the  farmers  at  6  V^  %,  but  o'nly  about  one- 
third  of  the  demands  for  loans  had  been  met. 

Alberta 

This  province  passed  three  Acts  In  1917  for  the  purpose 
of  aiding  farmers,  namely,  the  Live  Stock  Encouragement 
Act,  the  Co-operative  Credit  Act  and  the  Farm  Loan  Act. 

The  Live  Stock  Encouragement  Act  enables  associations 
of  farmers  to  apply  jointly  to  the  Live  Stock  Commissioner 
for  a  loan,  the  proceeds  of  which  shall  be  used  for  the  pur- 
chase of  improved  stock  of  cattle,  subject  to  the  approval 
of  the  commissioner.  Each  member  may  borrow  up  to  $500, 
and  the  interest  rate  must  not  excefed  6%.  Up  to  Dec.  31, 
1919,  the  total  loans  for  these  purposes  amounted  to 
$1,477,312.62. 

The  Co-operative  Credit  Act  embodies  the  same  prin- 
ciples as  the  Manitoba  Rural  Credits  Act,  and  is  in  all 
respects  the  same  as  tbe  latter,  with  one  fundamental  ex- 
ception, namely,  that  the  rate  of  interest  to  be  paid  by  the 
borrower  is  not  a  fixed  and  uniform  rate  for  all,  but  is 
decided  by  agreement  in  each  case  between  the  rural  credit 
society  and  the  bank  as  lender.  Very  little  has  been  loaned 
through  these  societies  in  Alberta,  although  the  Act  has 
been  in  effect  for  four  years. 

The  Alberta  Farm  Loan  Act,  except  in  minor  details,  is 
like  the  Manitoba  Farm  Loans  Act;  but  the  legislation  has 
never  been  put  into  operation. 

Ontario 

A  few  measures  intended  for  the  welfare  of  agriculture 
have  been  enacted  in  this  province,  but  the  results  of  their 
operation  have  been  relatively  unimportant. 

In  1916  an  Act  was  passed  authorizing  the  Government 
to  make  loans  to  settlers  in  the  newer  parts  of  the  province, 


for  the  purpose  of  clearing  land,  erecting  buildings,  pur- 
chasing machinery,  etc.  The  maximum  loan  to  any  settler 
is  $500,  and  the  rate  of  interest  is  6%.  By  October  31,  1920, 
the  total  amount  of  these  loans  was  over  $500,000. 

In  1920  the  Co-operative  Marketing  Loan  Act  was  passed, 
authorizing  the  Government  to  loan  to  a  co-operative  asso- 
ciation engaged  in  cleaning,  storing  and  marketing  seed 
and  potatoes  an  amount  not  exceeding  $3,000.  The  loan 
must  be  properly  secured;  it  will  be  free  of  interest  tor 
two  years,  after  which  6%  interest  must  be  paid.  Loans 
may  not  run  more  than  ten  years.  The  limited  extent  of 
the  authority  of  this  Act  must  prevent  any  significant 
expansion  of  these  loans. 

At  the  last  session  of  the  legislature  (in  April,  1921), 
after  a  thorough  investigation  of  the  rural  credits  problem 
by  a  governmental  commission,  three  Acts  were  passed 
making  provision  for  short-term  credits,  long-term  credits 
and  the  establishment  of  savings  offices  as  branches  of  the 
treasury.  This  legislation  is  almost  a  verbatim  copy  of  the 
Manitoba  legislation  for  the  same  three  purposes.  In  prin- 
ciple it  is  the  very  opposite  of  that  recommended  by  the 
commission.  At  the  present  time  (October  31,  1921)  the 
organization  of  the  administration  is  just  getting  under 
way,  and  it  is  expected  that  soon  six  branches  of  the  treas- 
ury will  be  opened  for  receiving  deposits,  on  which  interest 
not  to  exceed  4%  will  be  paid. 

Quebec 

Quebec  is  the  only  province  in  which  assistance  to  farm- 
ers, in  the  form  of  loans,  has  been  organized  by  private 
organizations,  without  any  participation  of  the  government. 
The  "people's  banks"  (known  as  Caisses  Populaires)  are 
co-operative  credit  banks,  from  the  deposits  of  which  loans 
are  made  to  farmers  both  on  short-term  and  long-term 
conditions.  Each  bank  is  a  community  institution,  with 
no  connections  outside  of  its  own  locality.  In  this  way  the 
management  of  the  bank  is  familiar  with  all  who  apply  for 
loans  ,and  can  therefore  decide  without  any  formality  as 
to  how  much  can  be  safely  loaned  to  the  applicants.  The 
funds  are  obtained  by  the  savings  deposits  of  the  people 
in  that  section  and  by  the  sale  of  the  bank's  shares.  The 
shares  are  valued  usually  at  $5  and  are  payable  in.  small 
instalments  of  a  few  cents  each.  The  system  is  intended 
to  encourage  thrift.  Most  of  the  loans  are  small,  ranging 
from  $5  to  $200,  and  repayment  of  the  principal  and  interest 
is  made  monthly.  The  rate  of  interest  paid  on  deposits 
varies  from  3%  to  4%,  and  the  average  rate  of  interest 
charged  to  borrowers  is  6%.  Not  a  dollar  has  ever  been 
lost  by  any  of  these  banks. 

New  Brunswick 

In  1912  an  Act  was  passed  to  encourage  the  settlement 
of  farm  lands  and  to  stop  the  migration  from  the  country 
to  the  towns.  Under  this,  the  government  put  out  a  bond 
issue  of  $100,000  to  run  for  20  years.  This  fund  is  to  assist 
settlers  in  purchasing  farms,  and  a  board  is  appointed  to 
administer  it.  The  board  helps  the  settler  in  securing  in- 
formation about  farms  and  in  making  his  choice  of  a  farm. 
When  a  settler  has  decided  on  a  farm,  the  board  examines 
it  carefully,  and  if  their  report  be  satisfactory  they  buy  the 
farm  and  resell  it  to  the  settler  upon  favorable  terms  of 
payment.  On  the  amount  which  the  board  loans  the  settler, 
interest  at  5%  is  charged.  If  the  settler  fails  to  make  his 
payments,  or  if  there  is  evidence  of  negligence  or  fraud, 
the  board  may  take  the  land  and  place  another  settler  upon 
it;  but  if  default  is  due  to  unfortunate  conditions,  he  is 
encouraged  and  assisted  to  the  utmost.  No  great  benefits 
have  been  secured  from  this  legislation,  probably  because 
the  ten-year  term  is  much  too  short  for  most  purchasers  to 
pay  for  their  land. 

Another  Act  to  provide  for  the  purchase  of  high-grade 
breeding  sheep  by  the  government  and  the  sale  of  these  to 
farmers  upon  suitable  terms.  Government  may  not  spend 
more  than  $50,000  in  this  way. 

Nova  Scotia 
No  provision  has  been  made  in  Nova  Scotia  for  short- 
term  credits,  but  for  mortgage  credit  legislation  was  passed 


January  6,  1922 


THE       MONETARY       TIMES 


<t 


(lead  Orrico  HiiildiiiK,  Montreal 

BOARD  OF  DIRECTORS: 

W.   MOLSON  MACPHKRSON 

President 

S.   H.    EWING,   Vice-President 

W.    M.    BIRKS  W.   A.   BLACK 

J.    M.    McINTYRE        F.  W.   MOLSON 

JOHN  W.  ROSS 

EDWARD    C.    PRATT 

General  Manager 


THF 

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 


BANK  OF  HAMILTON 


HEAD   OFFICE 


Established   1872 


HAMILTON 


Capital  Paid  Up 
Reserve  Fund    - 


BOARD    OF    DIKKCrrORS 


$5,000,000 
$4,850,000 


H.   S.  Ambrose 


Sir  John  Hendrle,  K.C.M.G.,  C.V.O.,  President;    Cyrus  A.    Birge,  Vice-President 

C.  C.  Dalton  Robt.   Uobson  W.  E.  Phin  1.  Pitblado,  K.C 

W.  P.  Riley  J.  Turnhull  W.  A.  Wood  A.  V.  Young 

Itranclu-s  ut  Montreal  and  tlironghout  Ontario,  the  North* West  and  British  OoIumbU 


National  Provincial  and  Union  Bank  of 

New  York— Hanover  National  Bank 
Mechanics      and      Metals 

National  Bank 
National  City  Bank 

Philadelphia— First  National  Bank 
Boston — National   Shawmut   Bank 
Buffalo—  Marine  Trust  Co. 
Pittsburg — Excbange  National  Bank 


Correspondents  in  Great  Britain 

England,  Limited;  Barclays  Bank,  Limited,  London,  England 

Correspondents  In  United  States 

Detroit— First    and    Old    Detroit   Na- 
tional Bank 


Chicago— Continental    and    Commer- 
cial National  Bank 
Cleveland — Union  Trust  Company 
St.    Louis — National    Bank    ot    Com- 
merce 
'  Kansas  City — ^Commerce  Trust  Com- 
pany 


Minneapolis — Northwestern    National 
Bank 


Seattle— Bank  of  California 

San     f'ranciaoo  —  Crocker    National 
Bank 

Duluth  —  American     Bxchanse    Na- 
tional Bank 


OOIiLECXIONS    EFFECTED   IN    AUi    PARTS   OF   CANADA    PROMPTLY   AN©   CHBAPLT 

CORRESPONDENCE    SOLICITED  SAVINGS    DEPARTMENT    AT    ALL    BRANCHES 


J.  P.  BELL,  General  Manager 


70 


THE       MONETARY       TIMES 


Volume  68 


in  1912  (Acts  of  1912,  chap.  10)  entitled  "An  Act  tor  the 
Encouragement  of  Settlers  on  Farm  Lands."  This  legisla- 
tion and  its  amendments  in  1913,  1915  and  1919  was  designed 
primarily  to  aid  those  who  are  just  coming  into  the  country, 
who  are  predominantly  British,  to  become  landowners, 
although  its  advantages  are  available  also  for  native 
farmers  and  prospective  farmers. 

The  government  loans  to  the  settler  indirectly,  through 
an  established  loaning  company.  The  settler  who  wishes  to 
borrow  must  have  cash  equal  to  20%  of  the  appraised  value 
of  the  land  he  desires  to  buy,  besides  what  he  would  require 
for  working  capital.  When  the  man  applies  to  the  appro- 
priate governmental  department  for  a  loan,  an  appraisal 
is  made  by  that  governmental  department  and  another  by 
the  lending  company.  If  the  conditions  are  reasonable,  the 
lending  company  will  advance  him  40%  of  the  value  of  the 
property  on  a  first  mortgage  as  security;  and  in  approved 
cases  and  to  thoroughly  experienced  farmers  the  govern- 
ment will  guarantee,  if  necessary,  an  additional  loan  of 
40%,  which  makes  the  company's  total  loan  in  such  cases 
80%  of  the  value  of  the  property.  Farms  on  which  such 
loans  are  made  by  the  government  must  be  operated  accord- 
ing to  instructions  so  as  to  keep  them  in   good  condition. 

The  loaning  period  was  formerly  15  years,  but  was 
changed  in  1919  to  30  years.  The  mortgagor  may  pay  off 
his  indebtedness  at  any  time  within  that  period.  Provision 
is  made  for  relieving  the  mortgagor,  in  certain  circum- 
stances, of  any  payments  upon  the  principal  for  a  period  c^ 
five  years.  The  rate  of  interest  charged  varies  from  6%  to 
7%,  according  to  the  condition  of  the  money  market.  Under 
this  Act,  a  large  number  of  loans  have  been  made,  and  the 
number  of  failures  of  borrowers  is  very  small. 

British  Columbia 

In  1917,  under  the  "Land  Settlement  and  Development 
Act"  with  its  amendments  in  1918,  1919  and  1920,  there  was 
constituted  the  Land  Settlement  Board  to  carry  out  the 
provisions  of  the  legislation.  To  this  board  advances  are 
made  from  the  provincial  treasury  in  such  amounts  and  at 
such  rates  as  the  government  may  direct.  The  board  may 
approve  agricultural  loans  for  any  purpose  which  will 
maintain  or  increase  agricuUural  or  pastoral  production, 
upon  the  security  of  first  mortgages.  Before  making  any 
loan,  the  board  must  be  satisfied  that  the  borrower,  after 
paying  all  charges  under  the  mortgage,  can  make  a  fair 
profit  from  his  investment  in  the  land.  To  any  borrower 
the  minimum  loan  is  $250  and  the  maximum  $10,000;  and 
ordinarily  the  maximum  loan  shall  not  exceed  60%  of  the 
appraised  value  of  the  land.  The  rate  of  interest  on  loans 
shall  be  arranged  as  nearly  as  possible  by  adding  not  over 
1%%  to  the  rate  paid  by  the  government  on  its  bonds  sold 
to  get  the  current  funds  for  the  board. 

Two  kinds  of  loans  are  permitted:  longdated  loans,  ex- 
tending for  15,  20  or  25  years,  repayable  on  the  amortization 
principle,  and  short-dated  loans,  extending  for  not  less  than 
three  nor  more  than  ten  years,  repayable  on  such  terms 
as  the  Ijoard  may  think  fit.  To  an  individual,  such  a  short- 
term  loan  must  not  exceed  $5,000;  but  to  certain  associa- 
tions which  enjoy  the  benefits  of  the  Act  the  loan  may  be 
Increased  in  each  case  to  not  more  than  $10,000,  upon 
approval  by  an  order  in  council.  In  the  repayment  of  a 
loan,  the  borrower  may,  on  any  interest  date,  pay  one  or 
more  of  the  instalments  in  advance  of  maturity. 

Another  important  power  given  to  the  board  is  found  in 
no  other  province  of  Canada,  but  is  an  adaptation  of  Aus- 
tralasian and  Californian  practice,  i.e.,  the  power  to  accept 
Crown  lands  or  to  buy  land  from  private  owners  and  develop 
it  for  agricultural  or  pastoral  purposes.  It  may  have  the 
power  of  a  landowner  in  using  the  land;  in  buying  and 
selling  live  stock  and  other  essentials  for  agricultural  opera- 
tion; In  selling,  leasing  or  exchanging  the  land,  etc.  More- 
over, If,  after  investigation,  the  board  thinks  that  agricul- 
tural production  is  being  retarded  because  of  lands  remain- 
ing undeveloped,  it  may  establish  a  "settlement  area"  in 
any  part  of  the  province.  Within  each  settlement  area  the 
board  shall  appraise  all  lands,  and  this  appraisal  shall  be 
the  basis  of  the  Improvements  to  be  made  on  the  land  by 


the  owners,  or  else  the  basis  of  sale  of  the  land.  The  owners 
of  unimproved  lands  in  such  an  area  must  begin  Improve- 
ments within  a  specified  time  or  render  themselves  liable 
to  a  penalty  tax  of  5%  of  the  appraised  value,  in  addition 
to  other  taxation. 

Finally,  this  board  was  to  take  over  the  functions  exer- 
cised by  the  Agricultural  Credit  Commission,  so  far  as  this 
was  possible.  But  this  commission  (organized  under  "The 
Agricultural  Act,  1915")  is  still  in  operation.  Its  duty  is 
to  administer  the  system  of  agricultural  credit  that  was 
established  by  the  passage  of  the  Act.  Its  funds  for  loaning 
come  partly  from  money  appropriated  by  the  legislative 
assembly  and  partly  from  the  sale  of  its  own  debentures, 
which  are  guaranteed  by  the  province  and  sold  through 
the  Minister  of  Finance.  A  sinking  fund  must  be  built  up 
to  pay  for  the  debentures  at  maturity,  and  a  reserve  fund 
must  be  developed  to  meet  any  possible  losses.  Only  a 
comparatively  small  amount  of  loans  has  been  made  up  to 
the  present  time. 


PROFITS  ACCRUING  TO  BANK  SHARE  HOLDKRS 

Tendency  of   Past   Few   Years   Has   Been    Towards  Higher 

Profits  and  Dividends,  but  Recent  Statements 

Sliow  Declines 

On  another  page  of  this  issue  is  a  very  illustrative  table 
showing  the  rate  of  profits  and  dividends  of  our  chartered 
banks  since  the  year  1911,  and  up  to  the  end  of  1920,  and  in 
some  cases  to  the  middle  of  1921.  The  entire  results  for 
the  whole  of  1921,  will  not  be  ready  until  later  in  the  year, 
but  the  statistics  compiled  by  The  Monetary  Times  give  a 
good  indication  of  the  year  to  year  growth  of  profits  and 
dividends. 

As  a  who'.e  profits  increased,  although  in  one  or  two 
individual  cases  a  small  decrease  is  shown,  where  the  banks' 
year  extends  well  into  the  deflation  period. 

There  were  no  reductions  in  dividends,  but  five  banks 
reported  permanent  increases,  while  three  institutions  de- 
clared extra  dividends  in  the  shape  of  bonuses.  It  is  not 
expected  that  the  complete  1921  results  will  show  bigger 
profits  or  bonuses  for  one  or  two  of  the  semi-annual 
statements  indicate  poorer  business,  which  was  only  natural. 
Perhaps  a  notable  fact  is  that  while  returns  to  share- 
holders have  increased  prices  of  bank  stocks  have  fallen. 
No  doubt  the  difference  can  be  explained  largely  in  the 
rise  in  money  rates  in  the  past  few  years,  which  always  re- 
sults in  lower  security  prices. 

For  the  sake  of  an  accurate  comparison,  the  high  prices 
of  several  of  the  bank  stocks  are  given  for  the  years  1912 
and   1920,   together   with   the   dividend   rates   for   the   same 
years: 
Bank  1913  1920 

Slock      Dividend  Slock      Dividend 

Price  rate%  Price         r8te% 

Commerce  230^^  10-1-1  199^!  12-f1 

nominioi 237^4  12H-2  206  12-1-1 

Hamlllon    208  11  194  12-4-% 

Imperial     233  12  200  12-1-1 

Merrlianls    200^4  10  202%  12-H 

Molsons    208>4  11  190  12 

Monlreal     250%  10-f2  220^:  12 

Nova   Scotia    278',4  14  271  16 

Royal    233  12  233%  12-1-2 

Slandard    239  13  222  14 

Toronto    214%  11-fl  197  12 

union  ..    ..    173%  8  Ml  10-1-2 

It  mu^t  be  taken  into  account  also  that  the  banks  have 
been  adding  largely  to  their  rest  fund  in  recent  years. 
From  1912  until  the  present  time, the  reserve  fund  has  been 
increased  from  $107,500,000  to  $135,064,646.  While  a  good 
part  of  this  fund  has  been  built  from  net  profits,  it  might 
be  mentioned  here  that  the  biggest  increase  has  taken 
place  from  January,  1919,  when  the  reserve  was  $116,- 
000,000,  and  tha't  during  these  three  years  a  big  factor  in 
the  building  up  of  the  rest  has  been  the  substantial  prem- 
iums received  on  new  stock  issues.  Bankers  are  proud 
of  their  reserve,  and  it  is  noticeable  that  almost  invariably 
an  increase  in  paid-up  capital  is  accompanied  by  a  similar 
or  perhaps  larger  increase  in  reserve.  This  is  made 
possible  by  the  receipt  of  substantial  premiums  which 
bank  stocks  command. 


January  6,  1922 


THE       MONETARY      TIMES 


71 


American  Bank  Note  Company 


BU81NESH    FOUNDKI) 
17»5 


<  A  NAKI.^  \     I  N(  OKI'OKA'flON 
18»7 


^  *!' 

!fc«Q 

PIK^ 

:  '.  :  . 

HEAD     OFFICE    AND     WORKS 

OTTAWA 

224  WELLINGTON   STREET 


Steel  Plate  Engravers  And  Printers 

Contractors  to  the  Government  of  Canada  for  Dominion 
Notes,  Postage  and  Revenue  Stamps.  Engravers  of  "ank 
Notes  for  the  Chartered  Banks  of  Canada.  Railway, 
Corporation  and  Company  Bonds,  Municipal  Debentures, 
Stock  Certificates,  Letters  of  Credit,  Cheques,  Drafts  and 
other  securities. 

Work    Acceptable    On    All    Stock   Exchanges 


TORONTO  BRANCH 

19  Melinda  Street 


MONTREAL  BRANCH 
224  St.  James  Street 


72 


THE       MONETARY       TIMES 


Volume  68 


Some  Big  Estates  of  the  Year  1921 

Value  of  Trust  Company  Services  Is  Recognized  By 
Their  Appointment  As  Executors  in  Many  Cases — Volume 
of    New   Corporate   Business   in    1921    Was    Not    Large 


•T»  OTAL  assets  of  all  the  Canadian  trust  companies  at  the 
*  end  of  1920  were  about  $750,000,000,  according  to  an  es- 
timate of  The  Monetary  Times.  Their  business  expanded 
still  farther  during  1921.  In  1920  the  progress  was  chiefly 
in  the  volume  of  estates  under  administration,  there  being 
fln  actual  reduction  in  guaranteed  investments.  It  is  prob- 
able that  the  developments  of  1921  were  along  the  same  line. 

The  advance  made  by  the  trust  companies  of  Canada  was 
a  short  time  ago  commented  upon  as  follows: 

"Product,  as  it  is,  of  practically  the  last  20  years,  the 
Volume  of  property  under  the  administration  of  Canadian 
trust  companies  is  impressive.  When  it  is  understood  that 
the  figures  represent  no  such  business  as  the  American 
trust  companies  have  found  so  lucrative  (banking,  real  es- 
tate and  security  selling),  they  become  more  so.  And  when, 
in  addition,  it  is  remembered  that  the  kind  of  business 
which  they  represent  is  in  its  nature  slow  in  growth,  de- 
pending necessarily  upon  the  growth  of  the  companies  in 
public  confidence;  that  the  figures  do  not  include  a  vast 
amount  of  securities  for  which  the  companies  act  as  trus- 
tee, transfer  agent,  and  registrar,  and  that  Canada  is  only 
at  the  starting  point  of  her  economic  development,  the  suc- 
cess of  the  Canadian  trust  companies  must  seem  remark- 
able, even  when  compared  with  the  growth  of  trust  institu- 
tions elsewhere." 

Building  Up  Confidence 

It  is  obvious,  having  regard  to  the  nature  of  the  busi- 
ness sought  and  transacted  by  trust  companies,  that  it  can 
only  be  obtained  by  securing  the  confidence  of  the  public, 
if  we  look  over  the  records  of  the  chief  companies — those 
which  have  adhered  to  the  recognized  limits — there  has 
been  no  development  other  than  that  which  tends  to  build 
up  confidence.  The  public  has  been  witness  to  the  outstand- 
ing fact  that  in  the  hands  of  a  corporate  trustee  the  inten- 
tion of  the  testator  is  carried  out  to  the  letter.  Beneficiaries 
at  times  have  taken  issue  with  corporate  trustees  as  to  their 
rights  under  a  will,  and  it  has  been  found  upon  recourse  to 
litigation  that  no  intention  has  been  disclosed  on  the  part 
of  such  corporate  trustees  except  to  follow  the  letter  and 
spirit  of  a  testator's  instructions. 

Taxation  Work 

Within  the  past  few  years  another  factor  has  developed 
which  adds  to  their  business.  It  is  the  growing  difficulty 
which  private  individuals  find  in  handling  their  affairs.  We 
have,  due  to  the  war,  various  forms  of  taxation.  Companies 
themselves,  in  order  to  keep  in  close  touch  with  different 
forms  of  taxation  imposed  by  different  authorities,  have  to 
establish  special  departments  for  that  purpose. 

If  it  is  a  matter  of  difficulty  for  these  highly  organized 
companies  to  understand  and  handle  efficiently  the  prob- 
lems of  taxation,  how  much  more  difficult  it  must  be  for 
the  private  individual  to  do  so.  It  will  be  obvious  to  any 
one  that  the  intricate  taxation  returns  which  today  are 
called  for  must  be  embarrassing  to  the  average  individual, 
many  of  whom  resort  to  specialists,  while  numbers  have 
sought  advice  from  the  trust  companies.  To  meet  such  a 
demand  special  officials  in  some  cases  have  been  appointed 
to  make  a  special  study  of  taxation  problems  so  as  to  pro- 
tect their  clients  as  well  as  their  companies.  This  illus- 
trates the  character  of  the  services  which  the  trust  com- 
pany provides,  and  that  it  is  appreciated  by  the  public  is 
best  illustrated  by  the  growth  of  the  assets  placed  in  their 
care  for  administration. 

No   Money   Lost 

In  a  speech  before  the  Kiwanis  Club,  Hamilton,  on  Sep- 
tember 13,  S.  C.  Macdonald,  manager  of  the  Mercantile 
Trust  Co.,  alluded  to  the  fact  that  it  was  just  a  hundred 


years  ago  that  the  first  trust  company  was  formed  in  the 
United  States,  and  just  forty  years  ago  since  the  first  one 
was  started  in  Canada.  In  the  whole  one  hundred  years, 
there  has  never  been  one  dollar  lost  through  misappropri- 
ation. This  method,  therefore,  has  proven  to  be  superior 
to  the  individual  trustee  system,  and  is  given  as  the  reason 
for  the  formation  of  trust  companies.  The  men  at  the  head 
of  trust  companies  have  to  be  of  the  highest  business  in- 
tegrity; and  every  business  investment  has  to  have  the 
investigation  and  approval  of  seven  directors,  so  that  the 
whole  enterprise  is  a  public  institution  of  the  finest  and 
firmest  kind.  Such  lines  as  banking,  corporation  work, 
trust  work,  registering  and  transferring  property,  were 
some  of  the  main  functions  of  the  business. 

Liarge  Estates  of  the  Year 

Some  big  estates  came  into  the  hands  of  trust  compan- 
ies of  Canada  during  the  past  year.  A  few  of  the  larger, 
which  have  been  reported  to  The  Monetary  Times,  are  as 
follows: 

Trust  Co.  Estate  of         ,          Amount 

Canadian  Guaranty  James  P.  Maynes,  Harrowby, 

Man %      60,000 

Toronto    General  Rev.  Robt.  Knowles,  Toronto      142,000 

National  T.  J.  Labatt,  Montreal  1,000,000 

National  Mrs.    K.    S.   Hammond,   Sara- 

nac  Lake,  N.  Y 200,000 

National  H.  R.  Frankland 121,776 

National  Mrs.  M.  Blong,  Toronto  201,000 

London    &    Western  J.  L.  Englehart,   IngersoU  ....  2,056,000 

Western  J.  Moser,  Regina  30,000 

Western  J.  Ellis,  Kinistlno,  Sask 50,000 

Capital  J.    &    W.    J.    Crampsey,    To- 
ronto   

Chartered  Sir  W.  J.  Gage,  Toronto  900,000 

Toronto  General  J.  H.  Paterson,  Toronto  557,000 

Toronto  General  Mrs.  E.  Morse,  Toronto  40,000 

Toronto   General  T.   Hunter,   Toronto  51,000 

National  Sir  P.  W.  Baillie,  Toronto 2,216,000 

National  B.   M.   Britton,   Toronto   3,369,000 

Imperial  Wm.   Hall,   Stouffville   65,000 

Royal  Susan   A.    Macdonald,   Earns- 

cliffe    23,000 

Canada  J.  H.  Challoner,  Lobo,  Onl 32.000 

Canada  W.  G.   Pitzgerald,  London  ....        18,000 

Canada  Alonzo  Decker,  London  21,000 

Canada  L.  E.  Smith,  Cairo,  Oni 16,000 

Royal  Dr.  W.   A.   Mo'.son.   Montreal      644,000 

Canada  Maria  W.   Anderson,   London        60,000 

Canada  G.   A.   Hamilton,   London   80,000 

Toronto   General  Hon.   Lionel   Clarke   321,000 

Toronto   General  Dr.  A.  J.  Johnson,  Toronto....      214,829 

Toronto   General  C.  F.  Farwell,  Whitby  279,000 

Toronto  General  Mrs.    Eliz.   White,    Toronto....      212,000 

Toronto  General  E.  A.  Walsh,  Stratford  70,000 

Trusts  &  Guarantee  Hon.  A.  L.  Slfton,  Calgary  ....      490,000 

Coi-porate  Business 

1921  was  not  a  year  of  activity  in  new  issues  of  corporate 
securities.  There  were,  however,  numerous  reoganizations, 
which  meant  the  exchange  of  many  securities.  Some  of 
the  new  issues  of  the  year,  with  the  name  of  the  trust 
company  acting  as  registrar  or  trustee,  were  as  follows:  — 

(Trust  Co.)  Toronto  General,  registrar,  and  National, 
transfer  agent,  (Issuing  Co.)  British  Empire  Steel  (Secur- 
ity), $100,000,000  stock. 

(Trust  Co.)  Western  Trust,  trustee,   (Issuing  Co).  North 


January  6,  1922  THEM0NBTARYTIMB8  T» 


THE  MERCHANTS  BANK  OF  CANADA 

ESTABLiISHKD    18«4 

HEAD  OFFICE:  MONTREAL 

CAPITAL  PAID-UP $10,500,000. 

RESERVE  FUND  &  UNDIVIDED  PROFITS      -          -          -  9.743.375. 

TOTAL  DEPOSITS  (30th  April.  1921)     -          -         -         -  154.911.487. 

TOTAL  ASSETS  (30th  April.  1921)        ....  190.367.409. 

PRESIDENT.    SiB-H.  Montagu  Ali.a.v,  C.V.O  VICE-PRESIDENT:    F.    Howabo    Wii/tny. 

GENERAL  MANAGER:   D.  C.  Macabow. 
Supt.  of  Blanches  and  Chief  Inspector:   T.  E.  Merrltt        General    Supervisor:    W.    A.    Meldrum. 

Collections    For   Manufacturers 

The  Merchants  Bank  can  assist  very  materially  your  own  Collection  Depart- 
ment in  obtaining  acceptances  and  making  prompt  returns  on  Drafts,  Notes 
and  other  Financial  Papers.  The  Merchants  Bank  now  operates  hundreds  of 
branches  in  Canada,  extending  from  coast  to  Coast;  as  well  as  offices  in  New 
York  and  London,  England,  and  reliable  c  rrespondents  throughout  the  com- 
mercial world.  These  facilities  assure  Manufacturers,  Wholesalers,  Impor- 
ters and  Exporters  that  their  collections  will  be  made  quickly  and  efficiently  at 
the  lowest  possible  cost. 

NEW    YORK    AGENCY:    38    Wall    St.,  LONDON,  ENGLAND,  OFFICE,  5.3  Cornhill, 

W.  M.  Ramsay  and  C.  J.  Crookall,  Agents.  J.     B.     Donnelly,     D.  S.  O .,     Manager 


Th. 


Traders   Trust   Company 


Authorized   Trustee   to  Act   under   the     Bankruptcy    Act    in    the    Pro>'ince8    of 
Manitoba,   Saskatchewan,  and  Alberta 

EXECUTORS 

Jb.nu:holson  ADMINISTRATORS    AND   MS^^^;^ 

FINANCIAL  AGENTS 


Head  Office:  WINNIPEG.  Branch  Offices:  Regina,  Saskatoon,  Edmonton 

BANKERS:  Merchants  Bank  of  Canada. 


74 


THE       MONETARY       TIMES 


Volume  68 


Empire  Fire,   (Security)  $115,000. 

(Trust  Co.)  Montreal  Trust,  (Issuing  Co.)  Rlordon  Co. — 
reorganization,   (Security)  . 

(Trust  Co.)  Quebec  Savings  &  Trust,  (Issuing  Co.)  Que. 
Ry.,  L.  H.'&  P. — retirement,    (Security)   . 

(Trust  Co.)  National,  (Issuing  Co.)  Toronto  Railway- 
retirement,   (Security)  . 


(Trust  Co.)  Nova  Scotia,  (Issuing  Co).  Clarke  Bros.^ 
retirement  (Security)  . 

(Trust  Co.)  Royal  Trust,  (Issuing  Co.)  English  Elecetrlo 
Co.),    (Security)   50,000  shares. 

(Trust  Co.)  Trusts  &  Guarantee,  (Issuing  Co.)  Dominion 
Combing  Mills,   (Security)    $2,500,000. 

(Trust  Co.)  Northwestern,  (Issuing  Co.)  Home  Appli- 
Combing  Mills,   (Security)  $2,500,000. 


Liquidation  of  the  Dominion  Trust  Company 

Creditors  Came  Out  Very  Short — A  Review  of  the  Long  Extended 
and  Complicated  Arrangements  for  Disposing  of  the  Assets  of  This 
Pacific     Coast     Venture — Business     Is     Now     Almost     Finished 


THE  liquidation  of  the  Dominion  Trust  Company,  Ltd., 
which  has  been  one  of  the  most  sensational  features 
of  this  kind  in  this  country,  was  practically  completed  in 
1921,  seven  years  after  the  company's  downfall.  The  de- 
velopments in  connection  with  this  liquidation  have  added 
something  to  the  interpretation  of  trust  company  law,  and 
have'  been  instructive  to  investors  in  and  directors  of  trust 
companies. 

The  company  did  a  tremendous  business  for  several 
years.  The  managing  director,  W.  R.  Arnold,  was  found 
dead  in  his  garage  with  a  shotgun  at  his  side.  His  death 
precipitated  the  smash  althougli  for  several  weeks  pre- 
vious there  had  been  rumors  that  the  concern  was  in  se- 
rious financial  difficulties.  The  company  was  doing  busi- 
ness as  a  trust  company  and  as  a  bank,  carrying  a  huge  de- 
posit account.  It  was  practically  a  one-man  affair,  the 
directors  leaving  the  management  almost  entirely  in  Ar- 
nold's hands. 

Arnold  had  a  sensational  career.  Starting  out  in  lifS 
as  a  grocery  clerk,  before  he  was  thirty  he  was  drawing  a 
salary  in  the  neighborhood  of  $15,000  as  managing  director 
of  the  Dominon,  Trust.  At  the  time  of  his  death  it  was 
found  that  he  carried  $200,000  insurance  in  favor  of  his 
wife  but  that  all  his  available  personal  funds  had  been 
thrown  into  the  business  to  help  stave  off  disaster.  After 
a  long  court  fight  his  insurance  was  turned  over  to  the 
company's  creditors.  Much  of  his  trouble  Is  believed  to 
have  been  due  to  his  dealings  with  Alvo  von  Alvensleben, 
the  young  German  count  who  gambled  on  a  big  scale  here 
before  the  war  and  who  was  in  Germany  when  war  was 
declared.  He  has  never  been  allowed  to  return  and  what 
property  he  had  unencumbered  was  handled  by  the  cus- 
todian of  alien  enemy  property.  Part  of  the  proceeds  of 
this  property  will  eventually  go  to  the  Dominion  Trust 
Company.  The  creditors  will  finally  realize  about  25  cents 
on  the  dollar. 

Andrew  Stewart  was  appointed  liquidator  of  the  com- 
pany. In  January,  1916,  a  statement  was  made  by  Justice 
Murphy,  Vancouver,  that  the  Dominion  Trust  liquidation 
seemed  hopeless,  and  that  it  would  be  better  for  the  credi- 
tors to  know  the  real  facts  of  the  case.  His  Lordship's  state- 
ment was  founded  on  a  report  of  the  auditors,  Marwick, 
Mitchell,  Peat  and  Company,  filed  in  March,  1915,  but  not 
previously  made  public.  This  report  showed  that  there  were 
over  $3,000,000  worth  of  claims  by  unsecured  creditors, 
while  the  estimated  assets  were  only  $460,000,  plus  the  re- 
sults of  the  lawsuits  against  the  directors  and  against  the 
insurance  companies  for  the  Arnold  insurance.  Of  the 
Arnold  Insurance,  a  sum  of  $212,000  had  been  paid  over  to 
the  liquidator,  who,  in  turn,  was  sued  for  $75,000  by  Mrs. 
Arnold  and  her  children. 

The  costs  of  the  liquidation,  which  were  a  first  charge 
against  the  proceeds  of  the  estate,  were  up  till  the  end  of 
September,  1915,  approximately  $115,000,  and  were  estimated 
by  counsel  in  court  at  $150,000  for  the  first  year  of  the  per- 
manent liquidation.  This  amount  did  not  Include  the  costs 
of  the  liquidation  of  the  subsidiary  companies. 


Liquidation   Costa 

The  liquidation  proceedings  were  featured  by  an  in- 
vestigation made  in  January,  1916,  into  the  cost  of  the 
liquidation  itself,  all  the  liquidator's  accounts  up  to  that 
time  being  examined.  On  January  27,  Justice  Murphy 
declared  that  the  explanations  made  by  the  liquidator 
were  above  criticism.  A  statement  filed  by  the  liquidator 
showed  that  the  total  expense  of  liquidation  to  date  had 
been  $144,685,  of  which  $88,678  had  already  been  paid 
out.  Another  statement  showed  that  the  future  monthly 
expense  would  be  on  a  diminishing  scale.  From  February 
1st  the  total  monthly  expense,  except  legal  costs,  were  es- 
timated at  .$1,832.25. 

The  expenses,  totalling  $144,685,  were  made  up  of  the 
following  large  sums  and  a  great  many  small  ones:  Sal- 
aries, $41,235;  agents'  remuneration,  $21,580;  legal  ex- 
penses, $39,805;  investigations,  $21,235;  expenses  of  mis- 
feasance suit,  $10,499,  etc.  Of  these  a  total  of  $88,678  had 
been  paid,  the  larger  items  being  $41,235  for  salaries, 
$8,280  for  agents'  remuneration,  $18,422  for  legal  expenses, 
and  $10,500  for  Investigation,  as  well  as  many  smaller 
items. 

Another  portion  of  the  statement  showed  that  a  total  of 
$364,871  had  been  collected  by  the  liquidator.  Of  this  sum 
$204,695  was  for  the  Arnold  estate,  and  $18,336  had  been 
applied  on  the  bank  collateral  loan,  reducing  the  total 
collection  to  $286,534.  Other  receipts  from  the  earning 
of  the  company's  oflice  business  were  $13,070,  and  the  total 
receipts  credited  was,  therefore,  $299,604. 

In  still  another  portion  of  the  statement  the  disburse- 
ments were  dealt  with  as  follows:  The  liquidation  ex- 
penses were  augmented  by  $18,409  paid  out  to  protect 
assets  and  on  preferred  claims,  security  for  costs  in  litiga- 
tion, etc.    The  total  disbursements  therefore  were  $107,088. 

A  balance  sheet  summarized  the  above  figures  as 
follows: 

Cash  on  hand  Oct.  27,  1914  (date  of  liquidation), 
$19,600;  cash  receipts,  $299,604;  total,  $319,205. 

Cash  disbursements,  $107,088;  cash  on  hand,  $212,116; 
total,  $319,206. 

Action  Against  Directors 

Action  was  brought  by  liquidator  Stewart  against  the 
directors  for  the  return  of  several  million  dollars.  Justice 
Murphy,  in  a  judgment  on  January  29,  1916,  excused  cer- 
tain out-of-town  directors,  but  decided  that  W.  H.  P.  Clubb, 
Dr.  W.  D.  Brydon-Jack,  F.  R.  Stewart,  T.  R.  Pearson,  Jas. 
Ramsay,  Dr.  G.  E.  Drew,  E.  L.  Reid,  K.C.,  Wm.  Henderson, 
Dr.  H.  W.  Riggs,  James  Stark,  E.  W.  Keenleyside  and  E.  P. 
Miller  were  liable.  He  relieved  from  liability  John  A. 
Machray.  K.C.,  of  Winnipeg;  John  Pitblado,  of  Montreal; 
David  W.  Bole,  Montreal;  Edward  Bell,  Vancouver;  and 
C.  W.  Twelves,  of  Antwerp. 

An  admission  by  Liquidator  Andrew  Stewart  that  he 
was  convinced  none  of  the  directors  of  that  defunct  com- 
pany profited  personally  by  any  of  the  acts  of  misfeasance 
with  which  they  were  charged  was  the  oustinding  feature 
of  the  evidence. 


January  6,  1922 


THE       MONETARY      TIMES 


75 


WHAT  A  'TAYLOR" 
HAS  IT  HOLDS 

Through  the  most  deetructlve  Ore,  IntenM  beat.  *nd 
heavy  Impact,  a  "TAYLOR"  safe  faithfully  guards 
its  contents  from  all  harm.  Confidence  Is  never  ml»- 
I>laced. 

Read  extract  from  Mr.  A.  K.  Hunciman's  letter  after 
fire  at  Annapolis  Royal,  N.S.,  September,    1921: 

"A  safe  that   will   bring  Its  contents  out   In   perfect 
condition    when    iron   melted   and   steel    radiator   pipes 
.  are  a  twisted  mass  is  good  enough  for  me.  and  I  am 
placing  an  order  for  a  new  safe." 


ONLY  A  REAL  SAFE  CAN  GIVR  Kt'LI.  HKuTl.lTIOX 


J.    &  J.  TAYLOR,     LIMITED 

Toronto     Safe   Works,  -     -     -  Toronto 

Branches  :  MONTTiEAL,  WINNIPEQ  VANCOUVER 


The    Home    Bank 
of  Canada 


BONDS   AND   FOREIGN   EXCHANGE 

Every  Branch  of  the  Home  Bank  is 
in  ready  communication  with  the  Bond 
and  Foreign  Exchange  Departments 
at  the  Head  Office,  and  a^y  enquiries 
made  through  any  branch  will  receive 
prompt  attention. 


Brnnchos    and    C^tnnections    tlirouKhout   Canada. 

Head   Office — 

810  King  Street  West,  Toronto 


The 

Montreal  City  and  District 
Savings  Bank 


Head   Office  and   Sixteen   Branches 
in    Montreal 


A.  P.  IiESPERANCE 
General   Maiuicer 

T.  TAtKJART  SMATH 
Asatstant   Genera)    Maaager 


76 


THE       MONETARY       TIMES 


Volume  68 


This  decision  was  appealed  by  the  directors  affected. 
Negotiations  with  the  shareholders  were  commenced,  how- 
ever, and  by  March,  1917,  an  agreement  had  been  reached 
whereby  twelve  directors  turned  over  about  $30,000  in 
assets,  partly  cash,  to  the  liquidator. 

A  Double  liiquidatlon 

The  case  was  also  contused  by  reason  of  the  organiza- 
tion of  a  "Dominion  Trust  Co.,"  under  which  name  the  old 
company  was  to  be  liquidated.  Some  of  the  holders  of 
partly  paid  shares,  against  whom  actions  for  the  balances 
was  being  taken,  refused  to  exchange  their  holdings,  how- 
ever. 

Liquidator  Stewart,  who  was  succeeded  by  J.  C.  Gwynne, 
on  his  retirement  issued  the  following  statement  of  the 
Dominion  Trust  Company's  affairs  as  at  November  7,  1918: 

Valuation 
Loans,    advances   to    Estates   and    Clients,    Mort- 
gages  and   Debentures,    Notes   and   Accounts 

Receivable    , $195,976 

Amounts  due  from  Contributorles    100,000 

Real    Estate    68,000 

Vault    Lining,    Door,    Safe    Deposit    Boxes    and 

Furniture     29,600 

Total   Unrealized  Assets    $393,576 

Cash  on  Hand  and  in  Bank 183,792 

Total  Assets    $577,368 

In  February,  1919,  an  attempt  was  made  by  J.  A.  Mac- 
Innes,  acting  for  a  number  of  shareholders,  to  prevent  the 
liquidation  of  the  Dominion  Trust  Co.,  Ltd.,  the  predecessor 
of  the  Dominion  Trust  Co.  The  liquidation  of  the  Dominion 
Trust  Company,  Ltd.,  was  decided  upon  owing  to  the  success 
of  Mr.  Maclnnes'  clients  in  evading  being  made  contributors 
of  the  Dominion  Trust  Company  liquidation  on  the  ground 
that  they  had  not  exchanged  their  shares  in  the  DominWn 
Trust  Company,  Ltd.,  for  those  of  the  Dominion  Trust 
Company. 

The  other  shareholders,  numbering  120,  and  represent- 
ing possible  contributions  of  $110,000,  who  did  not  bother 
to  contest  the  matter,  were  not  placed  on  the  list  of  the 
Dominion  Trust  Company,  Ltd.  Liquidator  Gwynne  took 
the  ground  that  there  was  neither  sense  nor  justice  in 
getting  judgment  twice  on  the  one  debt. 

Mr.  Maclnnes  contested  the  further  liquidation  of  the 
Dominon  Trust  Company,  Ltd.,  on  the  ground  that  the 
liquidator  was  not  seeking  to  join  the  120  shareholders 
referred  to  and  was  thereby  allowing  $110,000  of  contribu- 
tions which  ought  to  go  into  the  Dominion  Trust  Company, 
Ltd.,  liquidation,  to  go  into  the  Dominon  Trust  Company 
liquidation. 

This  case  reached  the  Supreme  Court  of  Canada,  which 
on  May  19,  1919,  dismissed  the  action;  this  enabled  J.  C 
Gwynne  to  proceed  with  the  liquidation  of  the  old  as  well 
as  the  new  company,  and  to  take  action  to  collect  an  addi- 
tional $140,000. 

Dividend  Payment 

In  October,  1920,  J.  G.  Gwynne,  liquidator  of  the  Dom- 
inion Trust  Company,  received  an  order  from  Mr.  Justice 
Murphy  authorizing  him  to  pay  a  dividend  of  ten  cents  on 
the  dollar  upon  those  claims  of  unsecured  creditors  which 
had  so  far  been  allowed  by  the  court,  and  to  set  aside 
claims  of  unsecured  creditors  not  yet  allowed  by  the  court, 
but  to  be  adjudicated  upon  in  the  near  future.  Secured 
creditors  had  already  been  paid  over  $25,000,  and  the 
amount  of  claims  as  adjudicated  upon  and  allowed  by  the 
court  upon  which  the  dividend  was  to  be  paid,  was  $2,358,- 
774;  the  unsecured  claims  still  to  be  adjudicated  upon 
at  that  time  totalled  $467,748. 

This  first  payment  of  10  per  cent  was  made  to  7,577 
creditors.  Depositors  were  entitled  to  rank  as  ordinary 
unsecured  creditors  for  one-half  the  amount  of  their  de- 
posits and  to  receive  a  dividend  thereon.     This  was  in  ac- 


cordance with  a  compromise  agreement  made  in  November, 
1919,  and  approved  by  the  court. 

Action  Against  Royal   Bank 

On  September  8,  1920,  liquidator  Gwynne  decared  that 
had  the  manager  of  the  Royal  Bank  made  proper  inquiry 
into  the  affairs  of  the  Dominion  Trust  Co.  before  making 
it  a  loan,  the  company  would  not  have  collapsed.  Accord- 
ingly he  entered  suit  for  the  return  of  securities  valued  at 
$250,000,  given  to  the  bank  as  collateral.  The  liquidator 
contended  that  the  Trust  Company  did  not  have  $100,- 
000  of  capital  subscribed  and  that  there  were  no  share- 
holders to  pass  a  resolution  authorizing  it  to  borrow. 
Counsel  for  the  bank,  on  the  other  hand,  produced  a  letter 
from  the  trust  company's  solicitors  stating  that  its  share 
register  was  in  order,  and  also  argued  that  the  assignees 
of  a  party  performing  an  illegal  act  by  which  he  benefits 
cannot  later  hold  the  other  party  to  the  transaction 
responsible.  One  of  the  bank's  officers,  John  T.  Kay,  testi- 
fied that  one  of  the  securities  on  which  the  trust  company 
borrowed  money  a  few  months  before  the  war  was  a  draft 
for  $155,000  put  hrough  by  Alvo  von  Alvensleben,  of 
Berlin. 

Special  Act  of  Parliament 

Doubts  had  arisen  from  time  to  time  as  to  whether  the 
act  incorporating  the  Dominion  Trust  Co.,  and  empowering 
it  to  commence  business  on  January  ,4,  1913,  for  the  pur- 
pose of  liquidating  the  Dominion  Trust  Company,  had  been 
complied  with  in  all  its  terms.  Accordingly  an  act  was 
passed  at  the  1920  session  of  parliament,  confirming  the 
action  that  had  been  taken. 

In  May,  1921,  liquidator  Gwynne  expressed  the  hope 
that  a  further  and  final  dividend  of  10  per  cent,  might  be 
paid.  It  would,  he  said,  depend  on  what  could  be  secured 
from  Alvo  von  Alvensleben,  who  had  endorsed  notes  of 
W.  R.  Arnold,  given  to  raise  money  for  their  joint  specula- 
tions. 

Liquidator   Discharged. 

Last  June  J.  C.  Gwynne  received  his  official  discharge 
as  liquidator  of  the  Dominion  Trust  Company  and  the 
Dominion  Trust  Company,  Limited.  Mr. •Gwynne  was  al- 
lowed the  sum  of  $6,000  for  his  services  and  was  congrat'i- 
lated  by  Judge  Murphy  for  the  excellent  way  in  which  he 
had  handled  the  liquidation  of  the  companies.  Harry  J. 
Burnett,  barrister,  was  appointed  officer  of  the  court  but 
was  not  styled  "liquidator."  He  is  handling  the  balance 
of  the  collections  at  a  monthly  salary  of  $100  and  10  per 
cent  of  net  amounts  collected. 

The  final  account,  duly  passed  by  the  registrar,  filed 
by  Mr.  Gwynne,  is  quite  a  formidable  document.  It  shows 
that  the  total  sum  collected  amounted  to  $1,673,000,  with 
disbursements.  Including  dividends,  amounting  to  $1,561, 
000.  The  balance  in  bank  amounts  to  about  $89,000,  and 
there  still  remains  to  be  collected  from  the  old  company 
about  $6,000  and  for  the  Dominion  Trust  Co.,  Limited, 
about  $110,000,  exclusive  of  the  Alvensleben  claim  which 
is  an  unknown  quantity.  As  the  collectable  amounts  have 
all  been  agreed  upon,  Mr.  Burnett's  duty  will  simply  to 
see  that  they  are  paid  in  due  course. 


ONTARIO  LOAN  AND  TRUST  DEPOSITS 

Deposits  of  Ontario  Loan  and  Trust  Corporations  as  at 
September  30,  show  a  decrease  compared  with  June  30. 
Holdings  of  cash  and  securities  and  loans  were  also  de- 
creased, however,  the  percentage  of  the  latter  to  deposits 
being  reduced  from  46.24  at  the  end  of  June  to  42.15  at 
the  end  of  September.  Returns  for  the  companies  show  a 
remarkable  variation  in  this  percentage,  from  as  low  as 
1.78  per  cent  to  as  high  as  13.56  per  cent.  The  figures, 
as  compiled  by  the  OntaYio  Registrar  of  Loan  and  Trust 
Corporations,  are  shown  in  this  section  of  The  Monetary 
Times  Annual. 


In  the  Investment  section  of  The  Monetary  Times 
Annual  a  statement  of  deposits  of  Ontario  Loan  and  Trust 
Corporations  as  at  September  30,  1921,  with  a  comparison 
with  June  30.  is  given. 


January  6,  1922 


THE       MONETARY      TIMES 


T7 


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.     Act  as  Agent  for  Executors  and  Trustees  who 

desire  to  be  relieved  of  th  e  management  of  Estates. 


Money  invested  for  Clients  on  Agency  or  Guaranteed    Plan. 

Issue. 


Acts   as    Trustee    under    Bond 


INCORPORATED  BY  SPECIAL  ACT,  A.D.  1909 

Executor      Administrator      Liquidator      Trustee      Guardian      Etc 


J.  F.  BOLE,  President. 
P.  N.  DARKE 
MAJOR  F.  J.  JAMES 
E.  E.  POOLE 

C.  V.  SMITH,  Manager 

102  Darke  Block 


DIKECTORH: 

A.  W.  MacGREGOR 
P.  G.  ENGLAND 


A.  E.  WHITMORB,  Vice-President 
8.  C.  BURTON 
R.  M.  JOHNSTON 
A.  G.  RAWLINSON 
R.  A.   KIRKWOOD,  SecreUry 

Regina,   Saskatchewan 


The 

Yorkshire  &  Canadian 
Trust,  Limited 

Established   1889   in   Vancouvpi- 
A   General    Trust   Company   Business   Transaetcd. 


TBVTSTEK  ESTATES.  MANAGED 

EXEtJDTOIl  INSIBANCE    EFFECTED 

ADMINISTRATOK  BONDS  BOUGHT  AND  SOLD 

LIQUIDATOR  HEAL    ESTATE    AGENT 

Authorized   Trustee   under   Biinkruptcy   Act 
YORKSHIRE  BUILDING,  VANCOUVER,  B.C. 

lieneral   Manager  -         -  H.   \V.   DYSON. 


British  Canadian 
Trust   Company 

Head  Office — Conybeare  Block 
LETHBRIDGE,     ALBERTA 


Inoobporated  bt  Special  Ordimarcs  or  tbb  North- 
west Territories  or  Canada. 
(1901  Chapter  36.) 

Authorised  to  art  as 

EXECUTOR,  ADMINISTRATOR, 

TRUSTEE,  GUARDIAN 


General  Financial  Agent* 

C.   P.   P.  CONVHKAUi-:  GEO.  H.  STAGEY 

President  Vice-President 

GEO.  WM.  PARSONS 
Manager 

Authorized    Trustee   under    Dominion 
Bankruptcy  Act 


78 


THE       MONETARY       TIMES 


Volume  68 


Legal  Decisions  Effecting  Trust  Companies 

LangstafF  vs.  Langstaff  Decided  by  Saskatchewan  Court  of  Appeal 
— Schultz  vs.  Wayne  Coal  Co.  Decided  by  Alberta  Court  of  Appeal 
— Other    Points    Come    Up    Before    Higher'  Courts    of    Provinces 


\  large  number  of  cases  of  interest  to  trustees  were  de- 
■«»■  cided  by  the  Courts  during  the  past  year — the  most 
outstanding  being  reviewed   herein. 

In  the  Saskatchewan  Court  of  Appeal  the  case  of  Lang- 
staff  V.  Langstaff  was  decided  early  In  the  year.  The  facts 
were:  Helen  May  Langstaff,  carrying  on  business  as  West- 
ern Fruit  and  Provision  Co.,  wife  of  W.  F.  Langstaff, 
brought  action  against  Harvey  and  Maud  Langstaff  as  ad- 
ministrators of  the  estate  of  their  deceased  father,  James 
Dudley  Langstaff.  The  plaintiff  claimed  payment  of  two 
promissory  notes  of  $3,000  and  $2,000,  respectively,  alleged 
to  have  been  made  by  James  Dudley  Langstaff.  The  first- 
named  note  was  admitted  at  trial,  but  all  the  defendants 
denied  the  signature  of  James  Dudley  Langstaff  to  the 
second  note.  F.  G.  Squirrell  admitted  that  he  was  admin- 
istrator appointed  after  the  commencement  of  the  action, 
but  did  not  plead  plene  administravit,  or  want  of  assets. 
The  judgment  appealed  from  was  as  follows: — 
"Although  the  $2,000  note  is  suspicious,  and  the  circum- 
stances justify  the  administrators  in  disputing  it  and  insist- 
ing on  strict  proof,  after  looking  at  the  evidence  with  great 
care  and  thoroughly  sifting  same,  I  have  come  to  the  con- 
clusion that  the  note  was  made  by  the  deceased.  Against 
the  opinion  evidence  of  some  bankers  as  to  the  signature 
we  have  the  positive  evidence  of  W.  F.  Langstaff,  corrobo- 
rated by  Flora  Meech  and  Ruby  Cairns. 

"There  will  be  judgment  for  the  plaintiff  declaring  that 
the  defendants  are  liable  to  pay  the  amount  claimed  with 
interest  and  costs  to  be  taxed  in  the  course  of  administra- 
tion of  the  estate,  with  liberty  to  the  plaintiff  to  apply  fur- 
ther if  necessary." 

On  appeal,  Haultain,  C.J.S.,  says  in  his  judgment: — 
"The  trial  judge,  after  seeing  the  witnesses  and  hear- 
ing their  evidence,  has  found  for  the  plaintiff,  in  spite  of  the 
fact  that  he  considered  the  note  in  question  'suspicious.' 
There  is  ample  evidence  to  support  that  finding,  and  I  do 
not  think  we  should  be  justified  in  reversing  it.  The  trial 
judge  has  directed  that  the  judgment  against  the  adminis- 
trator should  be  for  payment  of  the  amount  due  and  costs 
in  due  course  of  administration.  I  think  that,  as  the  ad- 
ministrator did  not  plead  plene  administravit  in  his  de- 
fence, he  must  be  taken  as  admitting  assets  to  satisfy  the 
judgment." 

Subscription   to   Stock 

In  the  case  of  Schultz  v.  Wayne  Coal  Co.,  Ltd.,  before 
the  Supreme  Court  of  Alberta,   the  facts  were: 

"Schultz,  after  paying  $400  in  full  for  the  shares  of  this 
company  (Wayne  Coal  Co.,  Ltd.)  stock  for  which  he  had 
subscribed,  paid  the  company  again  in  full  tor  the  same 
by  mistake.  He  sued  the  company  for  this  money  some 
six  months  after  the  second  payment  was  made,  and  in 
that  action  he  issued  a  garnishee  summons  against  the 
Standard  Bank  of  Canada,  which  paid  into  court  the  sum 
of  $399.25,  being  the  amount  which  it  admitted  owing  the 
company  at  the  date  of  the  service  of  the  garnishee  sum- 
mons. Shortly  afterwards,  and  whilst  this  money  was  still 
in  court,  the  company  went  into  liquidation.  Schultz  claims 
to  be  entitled  to  this  money  and  the  liquidator  also  lays 
claim  to  it.  The  Master  at  Calgary  has  given  effect  to  the 
liquidator's  claim  and  from  his  decision  Schultz  appeals. 
The  question  is  asked  whether  or  not  Schultz  is  entitled  to 
have  this  money  paid  out  to  hin;  in  priority  to  all  other 
creditors." 

On  these  facts  Mr.  Justice  Walsh  said: 

"If  the  identical  money  which  he  paid  in  error  to  the 
cornpany  had  been  preserved  in  specie  or  so  ear-marked  as 


to  have  retained  its  identity  there  might  be  some  force  in 
this  contention.  But  that  is  not  the  case  at  all.  What  I 
am  asked  to  order  is  that  out  of  the  assets  which  should 
otherwise  be  available  for  distribution  pari  passu  amongst 
the  creditors  $400  should  be  taken  and  set  apart  for  re- 
payment to  him  of  the  money  which  the  company  improp- 
erly received  from  him.  I  do  not  think  that  I  can  do  that. 
In  my  opinion  neither  this  particular  fund  nor  any  other 
part  of  the  assets  of  the  company  is  impressed  with  a  trust 
in  favour  of  Schultz.  The  company  undoubtedly  owed  him 
this  money,  but  in  my  judgment  as  his  debtor,  and  not  his 
trustee.  He  sued  the  company  as  his  debtor,  and  so  if 
there  was  any  question  of  election  about  it  he  determined 
the  matter  by  the  form  of  his  action.  His  statement  of 
claim  is  not  before  me  but  it  must  have  been  for  money 
had  and  received.  Under  the  rules  he  could  only  have  is- 
sued a  garnishee  summons  in  an  action  for  a  debt  or  liquid- 
ated demand,  and  so  it  must  be  that  his  action  was  in  a 
form  which  clearly  shewed  that  he  treated  the  company  as 
his  debtor.  The  garnishee  summons  which  he  issued  could 
only  have  issued  upon  an  affidavit  proving  the  company's 
indebtedness  to  him.  If  he  was  not  before,  I  think  he 
thereby  elected  to  become  and  became  a  creditor  of  the 
company  and  his  claim  must  be  disposed  of  on  that  basis. 
If  he  had  carried  that  action  to  judgment  it  would  simply 
have  been  for  the  recovery  of  the  amount  of  this  debt." 

Joint  Bank   Account 

In  New  Brunswick  an  interesting  case  came  up  for  de- 
cision in  which  a  joint  bank  account  formed  the  basis  of  the 
case,  the  question  being  whether  such  was  a  gift  inter 
vivos,  a  transfer  of  property  by  way  of  trust  or  whether  It 
was  a  gift  which  was  not  to  take  effect  until  the  donor's 
death. 

The  action  was  brought  by  Frank  I.  Shortlll,  as  executor 
of  his  father's  will,  against  Helen  Grannan,  concerning  cer- 
tain moneys  deposited  to  the  joint  account  of  his  father 
and  Helen  Grannan.  Prior  to  April,  1914,  the  late  Owen 
Shortlll  had  in  the  savings  department  of  the  Bank  of 
Nova  Scotia  at  Fredericton  a  deposit  to  the  amount  of 
$1,100  or  thereabouts.  He  withdrew  this  money  on  April 
15,  1914,  and  on  the  same  day  deposited  it  in  the  Bank  of 
Montreal  at  Fredericton  in  his  own  name  and  that  of  the 
defendant,  the  defendant  being  described  as  Helen  M. 
Grannan.  At  the  same  time  he  and  the  said  Helen  M. 
Grannan  signed  an  agreement  with  the  Bank  of  Montreal 
to  the  effect  that  all  moneys  from  time  to  time  deposited 
to  the  said  account,  and  interest,  might  be  withdrawn  by 
either  of  them,  and  each  of  them  authorized  the  bank  to 
accept  as  sufficient  acquittance  for  any  amounts  withdrawn 
from  said  account  from  time  to  time,  any  receipt,  cheque 
or  other  document  signed  by  either  or  both  of  them.  It 
was  further  provided  in  the  agreement  that  the  death  of 
either  the  said  Owen  Shortlll  or  Helen  M.  Grannan  should 
in  no  way  affect  the  right  of  the  survivor  to  wtihdraw  the 
moneys  deposited  in  the  said  account.  It  will  be  seen,  there- 
fore, that  the  deposit  in  the  Bank  of  Montreal  in  the  joint 
names  of  Shortill  and  his  niece  was  on  the  condition  that 
the  money  could  be  drawn  by  either  or  the  survivor.  After 
Shortill's  death,  which  took  place  on  August  11,  1919,  the 
balance  then  in  the  Bank  of  Montreal  to  the  credit  of  joint 
account,  amounting  to  $1,147.22  was  withdrawn  on  August 
11,  1919,  by  the  defendant.  The  plaintiff  claims  that  the 
money  was  not  the  property  of  the  defendant,  but  belonged 
to  him  as  executor  under  his  father's  will.  This  will  was 
not  put  in  evidence,  but  throughout  it  was  treated  as  hav- 
ing been  made  some  years  before  the  money  was  withdrawn 


January  6,  1922 


THE       MONETARY      TIMES 


79 


THE  IMPERIAL  CANADIAN 
TRUST  COMPANY 

HEAD   OFFICE,   WINNIPEG,   CANADA 

Incorporated  by  Special  Act  of  the  Legislature  of  Manitoba 
Licensed  under  the  Laws  of  the  Provinces  of  Saskatchewan,  Alberta  and  British  Columbia 

AUTHORIZED   CAPITAL -       -  $3,000,000 

SUBSCRIBED    CAPITAL 1,171.700 

PAID  UP  CAPITAL  AND  RESERVE 1,196,349 

TOTAL    ASSETS 8,227,564 

niBECTORS 

Major  n.  E.  Sprague,  O.I3.E.,  J.  H.  G.  Russell,  Esci.,  W.  T.  Alexander,  Ksq.,  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. 

fieneral  Manager:     W.  T.  ALEXANDER,  Esq.  Asst.  General  Manager:     MAJOR  F.  R.  GEORGE 

Aufliorlzod  to  act  as 

EXECUTOR,   TRUSTEE,   ADMINISTRATOR,    GUARDIAN,   RECEIVER,   ASSIGNEE 

GENERAL  FINANCIAL  AGENTS 
Branches  at  VANCOIIVRR,   VICTOKIA,   CAIXJARY,  EDMONTON,  REGINA.  SASKATOON 


Executors  &  Administrators 
Trust  Company 


LIMITED 


Authorized  Capital 


$1,000,000 


HEAD  OFFICE 

10    Central   Chambers 
MOOSE  J  A  W,  -  Sask. 

Authorized    to   act    as 

Executor,  Administrator  and  Assignee 


BOARD  OP  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. 
Jno.  Crawford,  H.  H.  Bamford. 

W.  A.  MUNNS,  Manager 

(Official   Administrator  (or  the    Judicial  District 
of  Moose  Jaw,    Sask.) 


Canadian  Guaranty 
Trust  Company 

HEAD  OFFICE 
BRANDON,  MAN. 

Acts  as  Executor,  Administrator,  Trustee, 
Guardian,  Committee,  Assignee,  Receiver, 
etc. 

Moneys  Invested  for  clients  in  First  Mortgages 
on  improved  farms  only  to  yield  6*"^  to  J*^*". 

51/2'  allowed  on  sums  of  $500.00  or  upwards 
in  moneys  left  for  three  years  or  longer  un- 
der our  Guaranteed  Trust  Investment  Re- 
ceipts, 

Our  Agency  Department  is  fully  organized 
for  the  management  of  properties,  collection 
of  rents,  accounts,  etc.,  and  the  buying  and 
selling  of  Real  Estate. 

Official  Adntiinistrator  for  the  Northern  and 
Dauphin  Judicial  Districts  in  the  Province 
of  Manitoba. 

Authorized   Trustee   under  Bankruptcy    Act 

Branch   Office: 
SWIFT    CURRENT,    SASK- 


80 


THE      MONETARY      TIMES 


Volume  68 


from  the  Bank  of  Nova  Scotia  by  Shortill  and  redepoaited 
in  the  Bank  of  Montreal. 
Chief  Justice  Hazen  in  his  judgment  said: 

"I  tail  to  find  any  evidence  of  intention  on  the  part  of 
Shortill  to  create  a  trust  'or  become  a  trustee.  By  no  act 
which  admits  of  any  other  interpretation  did  he  evidence 
that  he  himself  had  ceased  t  obecome  the  beneficial  owner 
of  the  money  in  question  and  that  such  legal  right  to  it,  if 
any,  as  he  retained  was  held  by  him  in  trust  for  Miss  Gran- 
nan.  At  any  time  during  his  lifetime  he  could  himself 
have  drawn  out  every  cent  of  the  amount  under  the  agree- 
ment entered  into,  and  Miss  Grannan  would  have  had  no 
redress. 

"In  the  present  case  I  have  come  to  the  conclusion,  in 
view  of  the  evidence,  that  the  intention  of  Owen  Shortill 
was  thtat  the  gift  shou'.d  not  take  effect  until  after  his 
death.  The  fact  that  he  had  believed  that  he  had  arranged 
with  the  Bank  of  Nova  Scotia  that  the  money  should  go 
to  his  son  Prank;  the  fact  that  he  evidently  changed  his 
mind  and  decided  that  his  son  Prank  should  only  get  the 
farm  and  that  what  was  left  of  the  money  in  the  bank 
should  after  his  death  go  to  Miss  Grannan;  the  statements 
he  made  to  Miss  Grannan  which  I  have  already  quoted, 
and  which  are  practically  the  only  evidences  of  his  inten- 
tion, all  indicate  that  the  gift  which  he  intended  was  tes- 
tamentary in  its  character,  and  this  to  my  mind  is  sus- 
tained by  the  way  in  which  the  money  was  treated  after 
it  had  been  deposited  In  the  Bank  of  Montreal.  The  fact 
that  Miss  Grannan  did  not  for  years,  not  until  after  Short- 
it  as  if  it  was  his  absolutely,  and  acted  upon  his  directions 
in  regard  to  it,  confirm  me  in  this  view,  and  are  of  such 
a  character  as  to  almost  lead  to  the  conclusion  that  Miss 
Grannan  viewed  the  matter  in  that  light. 

"Having  concluded  that  there  was  no  gift  inter  vivos, 
and  that  there  was  no  transfer  of  the  property  by  way  of 
trust,  and  that  the  gift  was  not  to  take  effect  until  the 
donor's  death  and  was  therefore  testamentary  in  its  char- 
acter and  therefore  of  no  validity  by  reason  of  the  formal- 
ities of  the  Wills  Act,  requisite  in  such  cases,  having  been 
disregarded,  I  have  reached  the  conclusion  that  the  plain- 
tiff must  succeed." 

Guardian    of   Infant's    Estat« 

In  another  Alberta  case,  a  trust  company  had  been  ap- 
pointed guardian  of  the  estate  of  an  infant  and  had  failed 
to  keep  its  ward's  funds  properly  invested.  In  stating  the 
law  applicable.  Justice  Stewart  said:  — 

"In  21  Cyc,  p.  87,  it  is  said:  'It  Is  the  duty  of  a  guardian 
ti>  keep  the  ward's  funds  invested  and  in  the  case  of  failure 
to  do  so  he  may  become  liable  for  interest  thereon.'  And 
In  Simpson's  Law  of  Infants,  p.  289,  it  is  said:  'Prom  the 
doctrine  that  a  guardian  is  a  trustee  it  follows  at  once  that 
he  can  make  no  profit  out  of  the  office,  but  is  bound  to  act 
in  all  things  for  the  infant's  benefit.' 

"In  this  case  the  guardian  received  the  estate  of  the 
infant  into  its  hands  under  an  order  of  the  Court  which 
gave  no  special  or  any  direction  as  to  investment.  In  those 
circumstances  the  guardian  became  subject  to  the  general 
duties  of  a  guardian  of  an  infant's  estate.  A  consequence 
of  the  principle  enunciated  in  the  passages  above  quoted 
seems  clearly  to  be  that  the  guardian  has  no  right  to  act  in 
the  double  capacity  of  guardian  and  as  a  oerson  with  whom 
the  money  is  invested.  In  other  words,  without  special 
authority  from  the  Court  the  guardian  has  no  right  to  in- 
vest the  infant's  money  with  itself  (being  a  company)  and 
by  the  use  of  the  money  so  invested  with  itself  to  make 
a  profit  thereon.  The  very  fact  that  the  company  is  known 
as  a  company  whose  business  it  is  to  receive  money  for 
investment  seems  to  emphasize  this  view. 

"Whatever  the  situation  may  have  been,  therefore,  if  the 
guardian  made  no  investment  at  all  but  simply  kept  the 
money  in  its  own  hands,  when  it  appears  that  it  did  invest 
the  money,  it  seems  to  be  absolutely  clear  that  it  must  ac- 
count for  the  interest  actually  received  subject  to  its  right 
to  a  reasonable  remuneration  for  its  care  and  supervision 
of  the  estate. 

"The   moneys   of   the    infant    were   apparently   mingled 


with  other  trust  funds  and  these  were  Invested  by  the 
company  in  its  own  name.  It  should  obviously  be  charge- 
able with  the  interest  which  it  in  fact  received  on  the 
mingled  funds  so  invested.  Of  course,  a  small  proportion 
of  this  general  fund  seems  to  have  been  retained,  and  it 
was  no  doubt  legitimate  in  the  circumstances  to  retain  un- 
invested a  small  proportion  of  this  infant's  estate.  What 
was  the  proportion  actually  retained  is  of  course  difficult 
to  determine  upon  the  evidence,  but  the  best  the  Court 
can  do  is  to  make  such  allowance  for  this  as  would  seem 
to  be  fair  to  the  company." 

Succession    Duties 

By  a  decision  handed  down  in  the  Supreme  Court  of 
British  Columbia,  in  which  judgment  for  the  Crown  was 
given  in  the  case  of  the  King  against  the  United  States 
Fidelity  Co.  and  Lorenzo  J.  Quagliotti,  Justice  Gregory  af- 
firmed that  succession  duties  must  be  paid  on  the  amount 
of  estate  valuations  sworn  to  for  probate  purposes,  even 
though  the  estate  has  been  over-valued,  and  it  has  been 
found  impossible  to  realize  upon  it. 

The  Crown  sued  for  payment  of  succession  duty  on  the 
Victoria  estate  of  the  late  Mrs.  Patronilla  Quagliotti.  The 
estate,  which  included  several  old  buildings  in  the  city,  as 
well  as  the  Variety  and  Romano  Theatres,  wsa  valued  for 
probate  in  the  sum  of  $886,000,  the  duty  on  which  came  to 
.$44,287.  The  company  gave  a  bond,  in  twice  the  amount  of 
the  duty,  as  surety  for  the  executor,  Lorenzo  J.  Quagliotti. 
The  defendants  pleaded  that  the  estate  had  been  much  over- 
valued and  that  it  had  never  been  possible  to  realize  upon 
it.  It  was  given  in  evidence  that  the  estate  had  never  real- 
ized enough  to  pay  for  its  upkeep;  and  that  it  had  largely 
been  sold  for  taxes.  Evidence  was  submitted  to  show  that 
a  fair  valuation  would  have  been  about  half  of  that  ac-. 
cepted  for  probate;  and  it  was  argued  that  duty  should 
be  reckoned  on  the  amended  valuation. 

Justice  Gregory  agreed  that  the  estate  was  over-valued, 
and  thought  that  it  was  not  worth  more  than  $500,000  In 
1915,  when  the  valuation  was  made.  But  he  held  that  when 
the  bond  was  executed  both  the  defendants  and  the  Crown 
believed  it  was  to  secure  payment  of  the  amount  of  duty 
on  the  actual  valuation  made  tor  probate,  which  was  ac- 
cepted by  all  the  parties;  and  he  held  that  the  company 
is  responsible  under  the  bond.  Judgment  for  the  plaintiff 
was  given  in  the  sum  of  $44,287.50,  with  interest  at  6  per 
as  the  amount  of  the  duty  is  concerned. 


UNIFORM    TRUST    RETURNS 

One  of  the  developments  of  1921  in  the  trust  company 
field  was  the  working  out  of  a  uniform  system  of  annual 
returns  for  Ontario  and  for  Dominion  companies.  This 
form  was  arrived  at  after  extensive  conferences  between 
the  government  officials  and  the  loan  companies  concerned. 
The  form  is  a  booklet  of  31  pages,  requiring  considerable 
detail  as  to  assets,  liabilities,  receipts,  and  expenditures. 


MANITOBA   LKGISLATION 

At  the  1921  session  of  the  Manitoba  legislation  the 
Bankers'  Trust  Co.,  of  Montreal,  was  given  power  to  do 
business  in  the  province.  An  amendment  to  the  incorpora- 
tion act  of  the  Equitable  Trust  Co.  was  also  made,  em- 
powering the  directors  to  forfeit  any  shares  on  which 
payments  were  behind  by  ninety  days  or  more.  \ 

Manitoba  also  amended  its  "Lunacy  Act,"  providing 
that  where  any  portion  of  an  estate  is  in  the  hands  of  a 
trustee,  debtor,  &c.,  the  latter  should  merely  be  required 
to  have  a  receipt  from  the  administrator.  An  amendment 
was  also  made  to  the  "Trustee  Act"  regarding  the  form 
of  notice  to  be  sent  out  when  claims  were  to  be  filed. 


La   Societe   Internationale   d'   Administration   secured   a 

charter  with  trust  powers  and  capital  of  $299,000,  of  which 

$100,000  has  been  paid  up  early  in  1921.     The  office  at 

86  St.  James  St.  Montreal,  and  P.  L.  S.  Browne  is  manager 


INVESTMENT 


January   (!.    1!>22. 


T  H   K       M  O  N  K  T  A  1{  Y       T  I  M  E  S 


SI 


82  T  H  E       M  O  N  K  T  A  H  Y       T  I  M  K  S  Volume  (kS. 


United  Financial  Corporation 

LIMITED 


Investment  Bankers 


Canadian  Directorate 


Sir  Charles  Gordon,  G.B.E. President 

D.  C.  Macarow Vice-President 

Chas.  F.  Batchelder Vice-President 

Major  H.  H.  MacDouj>all       ....  Vice-President 

W.  A.  Black  A.  E.  Holt 

A.  J.  Brown,  K.C.  C.  R.  Hosmer 

Geo.  Chahoon,  Jr.  Wm.  McMaster 

Charles  Meredith 


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  :  14  King  Street  East 
OTTAWA  OFFICE:  709-711  Hope  Chambers 
LONDON  OFFICE :  46  Threadneedle  St.,  E.C.,  2. 


January  6,  1922. 


THE      MONETARY      TIMES 


S3 


The  Past  Year  in  the  Investment  Field 

A  Survey  of  Conditions  Affecting  Capital  and  the  Return  From 
It — Credit  Conditions  Have  Changed,  and  Movement  Is 
Now    Towards    Easier    Money    and    Lower    Interest    Rates 


BY  DR,  ADAM  SHORTT 


IN  taking  a  survey  o£  the  conditions  affecting  general  Invest- 
ments and  securities  towards  the  close  of  another  year, 
one  realizes  that  this  subject  presents  a  variety  of  reflections 
and  conclusions  according  to  the  point  of  view  from  which  it 
is  approached  and  the  circumstances  under  which  it  exists. 
In  times  of  stability  and  general  prosperity  the  investing 
public  is  usually  interested  in  a  wide  range  of  securities. 
Moreover  it  is  not  inclined  to  make  any  radical  distinctions 
between  the  securities  of  the  larger  private  corporations 
engaged  in  industrial  enterprizes,  public  utilities,  or  mone- 
tary and  financial  affairs,  on  the  one  hand,  and  the  various 
forms  of  public  bonds  and  debentures  on  the  other. 

Under  present  conditions,  however,  the  attitude  is 
entirely  diff'erent.  Very  shar^p  distinctions  are  made  in  the 
different  types  of  securitses.  This  is  not  necessarily  because 
the  less  favoured  are  suspected  of  unsoundness,  but  chiefly 
on  account  of  the  lack  of  accurate  knowledge  as  to  their  real 
soundness.  Thus  a  general  atmosphere  of  uncertainty  sur- 
rounds them,  and,  for  the  time  being,  they  are  simply  left 
alone  in  a  void  of  suspended  judgment.  There  is  also  a  more 
than  ordinarily  marked  (difference  of  attitude  between  those 
trading  on  capital  account,  for  the  profits  to  be  derived  from 
trading  on  fluctuations  in  the  market  prices  of  securities, 
and  those  who  are  buying  and  selling  for  the  enlarging  or 
readjustment  of  permanent  holdings,  with  a  view  to  the 
annual  income  from  dividends',  or  interest. 

Bonds  are  Favored 

On  the  whole,  there  is  a  marked  trend,  on  the  part  of 
the  permanently  investing  public,  away  from  stocks  and 
towards  bonds,  and  particularly  towards  the  bonds  of  maxi- 
mum stability  in  capital  value.  There  is,  however,  not  only 
the  trend  of  the  permanent  investor  but  of  those  also  who 
desire  for  various  reasons  to  keep  a  vei-y  considerable  portion 
of  their  capital  in  as  fluid  form  as  possible,  while  still  not 
foregoing  such  interest  on  their  funds  as  may  be  safely 
obtained  under  those  circumstances.  This  latter  influence 
brings  into  favour  short  term  securities,  including  those, 
whatever  their  term,  which  are  nearing  the  period  of  their 
maturity.  This  condition  also  creates  a  favourable  market 
for  exchequer  bills  of  short  dates,  and  call  loans  on  the  most 
reliable  secnrities. 

It  does  not  lollow,  however,  that  the  securities  upon 
which  one  can  immediately  realize  under  such  conditions  as 
the  present,  are  the  securities  upon  which  one  can  realize 
with  equal  certainty  during  periods  of  general  confidence 
and  prosperity.  As  we  shall  see  the  conditions  are  commonly 
reversed  under  these  different  circumstances.  In  such  cases 
everything  depends  on  what  gives  to  the  investment  market 
for  the  time  being  the  steadiest  demand  in  the  largest  volume 
for  certain  types  of  securities.  It  follows,  of  course,  that  the 
holder  of  such  securities  can  readily  realize  upon  them  with- 
out delay  and  without  sacrifice  of  capital. 
Deflation  is  Necessaary 

It  may  be  observed,  as  was  anticipated  a  year  ago,  that 
the  paist  twelve-month  has  witnessed  a  steady,  and  in  come 
respects  a  comparatively  rapid  progre^ss  in  the  process  of 
deflation  and  readjustment.  This,  of  course,  is  never  a  pleas- 
ing experience  for  the  business  v/orld  and  is  indeed  most 
pleasing  exrperienco  for  the  business  world  and  is  most 
reluctantly  acknowledged  to  be  actually  in  progress.  One 
hears,  throughout  such  periods,  the  constant  iteration  that 
the  tide  haa  turned  and  business  is  as  a  matter  of  fact  on 
the  upward  trend.  When  the  movement  is  actually  over, 
however,  it  is  commonly  accepted  as  a  necessarj',  and  on  the 
whole  salutory  (process.  On  the  other  hand,  the  impatience 
to  resume   full  economic  activity   is  not  always   likely  to  be 


gratified,  more  particularly  when  many  of  the  countries  on 
which  we  must  more  or  less  depend  for  our  economic  expan- 
sion have  not  yet  completed  their  deflation,  and  when  indoed 
some  sections  of  our  industrial  circle  have  not  yet  completed 
their  readjustment 

We  have  seen  our  agricultural  produce,  the  products  of 
our  fisheries,  and  many  of  our  more  ii.'.portant  raw  materials 
of  the  forest  and  the  mine,  reduced  to  practically  pre-war 
rates,  and  indeed  below  them  in  some  cases  such  as  live 
stock  and  grain.  We  have  not,  however,  accomplished  much 
in  reducing  those  services  and  products  such  as  transporta- 
tion and  housing,  to  which  abnormally  high  wages  contribute 
such  important  factors  of  cost  and  which  are  now  the  chief 
obstacle  to  the  return  to  normal  activity  and  enterprise.  In 
several  lines,  such  as  textiles,  boots  and  shoes,  food  prepara- 
tions, and  hardware,  the  older  supplies  being  practically 
exhausted  there  is  a  certain  necessary  revival  of  trade  to 
meet  at  least  immediate  demands.  But  these  evidences  of 
revival  are  diflident  and  manifestly  reluctant  to  a";^5J^»* 
the  production  of  any  considerable  quantities  of  goods  m 
advance.  There  is  indeed  a  rather  well  founded  conviction, 
though  little  public  assertion  of  it,  that  until  certain  further 
costs  of  production  are  lowered  it  is  unsafe  to  PCoduce 
extensively  for  the  general  market,  in  the  face  of  probable 
further  reductions  in  prices. 

Some  Clasaes  Feeling  Pinch 

In  the  meantime  the  farmers,  the  lumbermen  and  others 
find  themselves  hardly  situated  in  having  to  furnish  their 
products  at  considerably  lower,  in  some  cases  much  lower 
than  pre-war  rates,  while  having  still  to  pay  »PP">f'";'«*^'> 
war  prices  for  many  of  their  most  .'"'"«P«^.*''^'^  P"™7_ 
On  the  other  hand,  those  who  are  still  exacting  war  rat«  in 
wages  and  prices  are  obtaining  their  food  and  «^^™'  "^Jf.^ 
supplies  at  approximaU-ly  pre-war  rates.  Housing  »rt,n 
high  of  course,  and  is  simply  a  :are  in  point  since  it  « 
Jlainlv  due  t»  the  determination  of  the  building  trades  . 
retain  war  rates  in  wages,  notwithstanding  the^" 
manv  raw  materials  and  the  cost  of  living.  Nor  can  a 
temporary  revival  of  production,  however  cautious  meet  the 
urX  dJmand  for  housing  without  ^^^"^IT^'^^.^l 
almost  certain  decline  in  values  before  the  invested  cap.U 

can  be  recovered.  A-rain  as  ^^/yj^^^.'^y'^^l'^'tZll 
informed  quarters  of  Britain  and  the  UnUed  States  tho« 
cannot  be  a  permanent  revival  in  any  important  count r>  until 
European  trade   and  finance  are  upon  a  more  normal  basis. 

Meantime,  even  though  we  cannot  regard  our  deflation 
as  quite  complete  or  at  all  equifcible  for  ceitain  important 
elements  of  the  community,  and  although,  so  far  as  our 
trade  and  exchanee  conditions  depend  uoon  the  PfoPrw'';  o 
readiustment  in  other  countries,  there  is  little  >'""^'fJ^ 
prospcet  of  a  return  to  quite  no.Tnal  condtions.  yet  m  the 
'jiop  of  world  conditions  in  general  and  in  como^ri'-r  - 
most  other  countries,  we  have  much  for  whicJi  to  be  thankful 
in  Canada.  Most  of  the<se  fortunate  features  are  parbcularlv 
encourngine  'or  the  future  of  our  inve««T-'»>"»  -.rospecU  and 
our  ceneral  financial  stability. 

Itritnin  and   l"nlt<><l  S««t«-*  i«re  Sound 

The  two  countries  with  which  our  trade  and  financial 
relations  .ire  mort  intimately  connected — Britain  and  the 
United  States— represent  the  soundest  parts  of  the  world. 
Our  internal  financial  condition,  while  subject  to  heaw 
burdens,  presents  in  general  a  situation  of  stabilitv  and 
sanity.  In  nrovious  cri.«es  our  more  important  industrial  and 
commercial  estaWi.shmentjt.  and  our  banking  and  financial 
institutions,  under  mistaken  conceptions  of  what  eon^Jldted 
vigorous  and  wholesome  competition,  provided  for  «•<•>»  other 


84 


THE       MONETARY       TIMES 


Volume  68. 


a  precarious  existence  both  individually  and  in  their  mutual 
relations.  There  was  little  appreciation  of  the  necessity  for 
co-operation  and  mutual  support  in  the  face  of  common 
danger  and  trial.  There  prevailed  the  very  short-sighted  and 
selfish  policy  of  seizing  eveiy  opportunity  presented  by  a 
condition  of  diminished  trade  and  financial  stringency  of 
force  rival  institutions  to  the  wall.  There  seemed  to  be 
neither  the  will  nor  the  capacity  to  check  resort  to  desperate 
measures  of  a  "kill  or  cure"  nature  in  the  face  of  critical 
situations  resulting  from  the  past,  while  those  who  had  little 
more  to  lose,  with  a  possibility  of  something  to  gain,  indulg- 
«d  in  wild-cat  gambling  on  the  uncertainties  of  the  immediate 
future. 

Under  present  conditions,  however,  thanks  to  a  more 
intelligent  appreciation  of  the  lessons  of  past  experience  and 
to  the  efficiency  and  courage  of  those  who  have  applied 
wisdom  derived  from  the  past  to  better  the  relations  of  the 
present,  our  banking  and  financial  institutions  and  our  more 
responsible  industrial  and  commercial  establishments  are  co- 
operating quite  effectively  for  the  relief  instead  of  the  aggra- 
vation of  critical  situations,  and  to  suppress  whatever  tends 
however,  unduly  sheltering  from  their  inevitable  conse- 
■quences,  deliberate  unwisdom  and  folly  in  individual  cases. 
Where  possible,  effective  measures  have  been  taken  to 
prevent  the  secondary  effects  upon  innocent  parties  of  condi- 
tions which  they  could  not  well  foresee,  or  even,  when  fore- 
seeing, coMld  not  effectively  guard  against. 

Controlling  "  Big  Business  " 

Much  of  the  ^posisibility  of  dealing  firmly  and  intelligently 
with  the  inevitably  difficult  process  of  retreat  from  economic 
positions  which  had  become  untenable,  must  be  attributed  to 
the  much  abused  modern  economic  development  known  as 
"big  business,"  or  the  consolidation  of  extensive  economic 
interests  under  relatively  limited  executive  control,  although 
the  ownership  of  the  capital,  in  the  shape  of  shares  or  bonds, 
may  be  extensively  diffused. 

It  is  not  to  be  denied,  of  course,  that  such  consolidations 
afford  opportunities  for  subordinating,  under  certain  circum- 
stances, the  general  interests  of  the  community,  or  of  special 
individuals,  to  those  of  the  great  corporations  and  some  of 
their  organizers.  Their  size,  however,  and  limited  number, 
and  the  unavoidable  publicity  of  most  of  their  operations 
render  it  much  easier  to  protect  the  interests  of  the  public 
by  legislation  and  public  opinion,  than  in  the  case  of 
individuals  or  smaller  units.  The  exceptional  powers,  how- 
ever, which  are  admittedly  subject  to  abuse  under  such 
circumstances,  are  also  capable  of  being  employed  with  even 
greater  efficiency  in  the  protection  of  those  numerous  and 
fundamental  interests  in  which  these  corporations  and  the 
general  public  have  a  common  stake.  The  very  size  and 
range  of  such  combinations  render  the  field  of  common 
interest  much  more  extensi'^e  than  one  is  inclined  to  suppose 
from  a  superficial  view. 

It  must  be  admitted,  again,  that  the  administrative 
wisdom  of  the  great  corporations  is  not  faultless,  and  may 
on  occa.sion  take  a  course  contrary  alike  to  the  interests  of 
their  corporations  and  to  the  public.  Thus,  they  may  deplete 
their  fluid  reserves,  replenished  through  war  prosperity,  by 
the  distribution  of  exceptional  dividends  and  in  other  ways.: 
In  most  cases,  however,  realizing  that  trying  timss  must 
shortly  be  faced  after  such  a  destructive  and  demoralizing 
war,  they  have  employed  a  considerable  portion  of  their  large 
profits  in  fortifying  their  finances  for  just  such  a  period  as 
we  are  now  facing,  and  the  wisdom  of  such  action  redounds 
not  only  to  their  own  interests  but  to  those  of  the  country  at 
large,  including  even  their  most  vigorous  critics.  Notwith- 
standing the  steady  expansion  of  Canadian  economic  inter- 
esets  the  number  of  really  important  economic  corporations 
has  steadily  deminished.  In  critical  situations  like  the  present 
this  has  undoubtedly  enabled  the  common  nterests  of  the 
public  and  the  corporations  to  be  more  easily  and  efficiently 
conserved  and  protected.  This  has  undouhtedlv  been  due  to 
the  eliminating  of  miscellaneous,  ignorant,  and  merely  cut- 
throat competition,  throuerh  the  introduction  of  the  more 
intelligent  and  responsible  management  of  our  larger 
economic  enterprises. 

Thus,  while  every  notable  advance  brines  itr  own  pecul- 
iar defects  and  r'sVs.  we'  must  at  lepst  recoenize  that  we  are 
indebted  to  the  development  of  what  pre  known  as  bi^  busi- 


ness interests  for  the  capacity  to  meet  so  successfully  the 
temptations  of  the  large  corporations  to  take  advantage  of 
their  extensive  powers  for  comparatively  selfish  purposes,  in 
problems  of  deflation  and  readjustment.  Whatever  be  the 
times  of  general  prosperity  and  with  large  margins  of  safety 
to  encroach  upon,  the  obvious  necessity  for  a  very  close  regard 
for  all  common  interests  is  the  surest  safeguard  at  present 
that  these  powerful  instruments  of  financial  protection  will 
be  used  to  the  maximum  advantage. 

The  Banking  Field. 

In  the  field  of  banking  in  particular  we  may  recognize 
the  application  of  the  foregoing  reflections.  Two  factors 
have  chiefly  contributed  to  the  relative  safety  of  our  present 
banking  and  credit  system  as  a  national  service.  First,  the 
establishment  and  the  development  of  the  functions  of  the 
Canadian  Bankers'  Association,  not  the  most  valuable 
features  of  which  are  specified  in  the  legislation  defining  its 
powers.  The  unwritten  rules  and  customs  which  it  has  intro- 
duced and  extended  are  its  most  valuable  contribution  to  our 
present  financial  safeguards. 

Secondly,  the  notable  reduction  in  the  number  of  Canad- 
ian banks,  coincident  with  a  very  marked  expansion  in  the 
business  of  the  banks.  In  1905  there  were  thirty-four  banks 
with  one  thousand  one  hundred  ard  forty-five  branches.  In 
1921  there  are  eighteen  banks  with  four  thousand  six  hundred 
and  seventy-six  branches.  This  striking  reduction  in  the  num- 
ber of  the  banks  has  coincided  with  the  increased  financial 
stability  of  the  country.  There  has  been  a  corresponding  re- 
duction in  the  danger  of  disaster  to  individual  banks  and  the 
inevitable  strain  which  this  puts  upon  the  soundest  of  the 
banks,  owing  to  the  creation  of  a  panicky  condition  in  the 
lie  mind  with  reference  to  the  whole  system,  of  banking.  Under 
former  condit'ons  our  banks  were  relatively  more  unstable, 
lacking  in  Tp^rves  ■■vn''ble  under  critical  conditions,  more 
conscious  of  their  conflicting,  than  of  their  common  interests, 
and  with  a  weaker  sense  of  public  and  professional  responsi- 
bility. Under  these  conditions  there  were  apt  to  develop  in 
various  quarters  reckless  or  questionable  practices  which  the 
more  conservative  banks  were  powerless  to  check  in  any 
effective  manner.  Under  present  conditions,  however,  while 
one  cannot  say  that  all  risks  are  eliminated,  yet  the  banking 
system  as  a  whole  is  an  exceptionally  stable  and  efficient 
organization,  having  both  the  will  and  the  ability  to  main- 
tain the  exchange  and  credit  of  the  country  on  a  wholesome 
basis. 

Easier  Money  Conditions. 

One  of  the  most  reassuring  indications  of  the  mainten- 
ance of  public  and  private  credit  on  a  sound  basis  is  the 
tendency  already  manifesited  towards  the  accumulation  of 
considerable  quantities  of  fluid  funrls.  In  other  words,  a 
distinct  tendency  towards  an  easier  money  market.  This  has 
been  already  evident  in  the  United  States  and  England.  An 
easier  money  market  does  not  mean,  of  course,  that  money  is 
more  readily  available  for  all  forms  of  investment.  On  the 
contrary,  it  indicates  that  while  fundamental  conditions  are 
sound,  money  is  not  readily  available  for  many  fields  of 
enterprize.  It  is  only  very  partially  available  for  new  indus- 
trial and  commercial  investments,  but  these  are  just  the  fields 
in  which  deflation  is  not  yet  complete  and  confidence  in 
earning  power  not  yet  restored.  Under  wholesome  conditions 
new  funds  are  always  accumulatng  and  investments  for 
them  are  consequently  being  sought. 

But  where  there  is  uncertainty  and  lack  of  adequate 
information  as  to  offerings  for  investment,  the  field  of  actual 
investment  is  apt  to  be  very  considerably  narrowed.  A  wait- 
ing attitude  with  reference  to  the  general  economic  field  is 
quite  common  and  indicates  only  reasonable  caution.  This 
leads  to  the  accumulation  of  considerable  fluid  funds,  and  as 
it  is  d'^'^'rable  to  derive  such  revenue  from  them  as  is  con'^is- 
tent  with  a  ready  comn^and  of  canital,  they  naturally  seek 
employment  in  such  '■ecurities  or  loans  as  best  answer  these 
condit'ons.  Tn  most  case?,  with  a  stable  and  solvent 
government,  ^uch  ^o-^norpry  'nvestments  are  found  in 
government  spcurities,  whether  permanent  bonds,  or  short 
loans  and  nxcbequer  hills.  Call  loans  on  similar  securities 
are  also  favored. 

Gcvernment  Bond  Market. 

When    therefore    we    find,     a<;    at  present,     government 


January  6,   1922. 


THE      MONETARY      TIMES 


86 


'bonds  steadily  rising  in  value,  and  government  short  loans 
or  exchequer  bills  considerably  over-subscribed,  we  have 
fairly  certain  evidence  of  two  thiniijs.  First,  a  general  reluct- 
ance to  invest  in  industrial  and  commercial  offerinffs,  no 
matter  how  good  their  immediate  credit  may  be,  or  how 
attractive  the  dividends  or  interest  offered ;  and,  strcondly,  a 
fairly  st-ible  economic  situation,  with  a  sound  system  of 
banking  and  credit,  wTiich  permits,  on  the  one  hand,  the 
accumulation  of  surplus  funds,  and  encourages,  on  the  other, 
the  investment  of  them  in  the  soundest  securities,  either  for 
brief  periods  affording  a  ready  command  on  the  capital 
involved,  or  for  permanent  investments  with  certainty  as  to 
the  security  of  the  capital  and  tie  regularity  of  the  interest 
returns. 

Such  is  the  situation  in  wihich  Canada  finds  itself  today. 
Government  bonds  are  likely  to  stand  well  on  the  market  for 
some  time,  although  an  extensive  rise  is  scarcely  to  be 
expected,  for  certain  r.-,ore  or  less  obvious  reasons.  In  the 
first  place,  the  amounts  for  which  these  bonds  have  been 
issued  are  so  large  that  a  very  extensive  demand  can  only 
very  moderately  raise  the  price  of  them;  and,  in  the  second 
place,  it  is  doubtful  whether,  with  all  the  incentives  towards 
economy  and  the  reluctance  to  increase  taxation,  we  have 
yet  reached  the  end  of  our  national,  provincial,  and  munici- 
pal borrowings.  Such  additional  borrowings  will,  of  course, 
absorb  considerable  amounts  of  ready  capital  and  thus  also 
keep  down  the  prices  of  securities. 

On  the  other  hand,  the  more  rapid  rise  in  the  prices  of 
government  securities  in  the  United  States,  with  the  favor- 
able rate  of  exchange,  will  tend  to  divert  considerable 
amounts  of  American  capital  towards  investment  in  the 
public  securities  of  Canada,  and  thus  tend  to  increase  prices 
here,  speculative  anticipation  of  the  rise  materially  aiding. 
Again,  when  the  deflation  process  is  practically  completed 
and  prices  and  wages  are  once  more  reduced  to  such  a  level 
as  will  guarantee  safety  in  production,  permanence  in 
employment,  and  stability  in  Canadian  markets,  where  will 
undoubtedly  be  a  rapid — we  should  earnestly  pray  that  it 
may  not  be  too  rapid — transfer  of  attention  from  govern- 
ment securities  to  inaustrial  and  commercial  ventures  and 
public  utilities  operated  by  private  corporations.  This  trans- 
fer of  interest ^vill  not  indicate  any  more  intimate  knowledge 
of  the  fundamental  quality  of  the  securities  offered;  it  will 
indicate  merely  a  retuin  to  normal  conditions  and  the  restor- 
ation of  general  confidences — too  apt  to  pasis  into  over- 
confidence. 

Then  will  be  experienced  the  decline  of  comparatively 
high  priced  and  consequently  modest  income  producing  secur- 
ties,  in  which  large  quantities  of  funds  have  been  held  for 
temporary  Investment.  These  securities  are,  of  course,  not  in 
them.celvcs  capital,  before  at  least  the  period  of  their 
redemption,  liut  merely  guarantee  an  annual  income  return. 
Hence,  to  'ealize  on  the  capital  invested  for  them  one  has  to 
exchange  the  securities  for  such  available  fluid  capital  sis  is 
seeking  investment  at  the  time,  and  under  the  conditions 
stated  most  of  this  will  be  seeking  the  newer  and  more 
profitable  types  of  investment.  As  a  consequence,  the  measure 
by  which  the  government  securities  have  risen  uder  the  influ- 
ences which  are  operating  at  present,  will  probably  be 
exceeded  by  that  of  their  fall  under  the  reverse  movement, 
when  the  in'niense  volume  of  these  securities  will  then  aid  in 
depressing  the  market.  One  factor,  however,  will  tend  to 
check  this  downward  movement  and  that  is  the  tax-free 
quality  of  the  bonds. 

This  feature  is  of  no  consequence  for  the  smaller  invest- 
ors, but  is  of  the  highest  consequence  for  the  wealthy 
investors.  It  is  inevitable,  therefore  that,  in  the  course  of 
their  career  as  investment  securities,  the  tax-free  govern- 
ment bonds  will  more  and  more  concentrate  in  the  hands  of 
th'  wealthiest  element  in  the  community.  Much  the  most 
unfortunate  feature  of  this  is  its  tendency  to  divorce  the 
larger  cnpitali'ts  fron:  interest  and  participation  in  the 
recov  ry  of  tlvc  corntry  from  the  stagnating  effects  of  the 
war.  It  also  deminishes  their  more  cautious  and  conservative 
cont'ol  O'er  t'-e  inirely  speculative  and  reckless  elements 
wh'ch,  rfter  a  'rriod  of  depression,  tend  to  run  to  the  other 
extreme 

British  Imperial  Creditji 

A  rather  nteresting  feature  benring  on  conditions  which 
may  over-ftimulate  the  f\peculative  movement    in  the  period 


of  recovery  and  reaction  from  the  present  sti  in^r^ncy,  is  the 
attention  bein^  given  in  Britain  to  the  question  of  specially 
encouragfing  imperial  credits.  Such  credits,  it  ia  realized, 
promise  safer  opportunities  for  investment  than  most  purely 
foreign  fields,  outiiide  of  the  United  States.  Such  inve^imenu 
are  especially  to  be  encouraged,  however,  on  the  expectation, 
for  which  there  is  reasonable  grounds,  that  they  will  furnish 
outlets  for  British  goods.  In  other  words,  these  investments, 
from  the  national  point  of  view,  will  be  made  in  the  sha|>e  of 
goods  rather  than  in  cash  or  in  funds.  This  was  largely  true 
of  the  heavy  inve-itments  of  Britain  in  Canada  during  our 
pre-war  period  of  prosperity  and  vhich  was  closing:  just  as 
the  war  broke  out. 

It  is  true  at  least  that  Canada  took  all  of  its  hundreds 
of  millions  of  LoiTOwings  in  the  shape  of  goods.  While,  how- 
ever, imports  from  Britain  were  greatly  increased  in 
corsequence  of  the  loans,  imports  from  the  United  States 
were  still  greater  on  the  same  account,  and  were  paid  for  in 
exchange  on  Britain.  But  the  point  of  special  importance 
for  us  is,  that  during  the  period  of  investment  there  was  no 
difference  whatever,  as  regards  the  prosperity  crested, 
between  the  ultimately  sound  and  profitable  investments  and 
those  which  were  not.  This  aspect  of  the  situation  was 
largely  ignored  during  that  period  of  boom  and  as  equally 
absent  in  the  consideration  which  is  at  present  bein^  given 
to  the  subject  in  Great  Britain. 

In  our  next  period  of  expansion  through  foreign  capital 
the  United  States  is  certain  to  be  a  very  important  contribu- 
tor. The  productive  nature  of  the  investments  to  be  made  is 
the  consideration  which  most  nearly  concerns  Canada  and 
its  financial  future.  It  is  to  be  hoped,  therefore,  that  we  may 
profit  by  the  experience  of  our  pre-war  boom  to  avoid  those 
unfortunate  elements  of  one-sided  development  in  such  lines 
as  transportation,  urban  construction,  and  land  speculation, 
which  were  carried  so  far  beyond  the  proportionate  develop- 
ment of  the  country  in  all  the  more  vitally  productive 
activities,  and  which  have  contributed  so  much  to  our 
present  financial  distress. 


ROYAIi  SirVT'8  OUTPUT  WAR  1X)WER 


Moneys  Coined  and  I.<<sued  Nhow  Reductions  as  Oompared 
With    Previous    Year 


THE  following  companies  of  gold,  silver  and  bronze  moneys 
coined  and  issue  In  Canada  is  supplied  to  The  Monetary 
Times  by  the  Royal  Mint.  Ottawa:  — 

Gold 
Pieces    Value 

Coined  1st  Jan.  to  81st  Dec.,  1920 

Coined  1st  Jan.  to  31st  Oct.,  1921 

Issued  1st  Jan.  to  31st  Dec.,  1920   4        £    4 

Issued  1st  Jan.  to  31st  Oct.,  1921   136        £136 

Silver 
PisMS  Value 

Coined  1st  Jan.-31  Dec.,  1920 19,453,358     $1,926,690 

Coined  1st  Jan.-31  Oct.,  1921   4.'.tr,(i.ni'...  :,:i.ll7 

Issued  1st  Jan.-31  Dec.,  1920  l.'-.472,i""i       l..S.><;,iX)0 

Issued  1st  Jan.-31  Oct.,  1920  1.260,(XK)  86,000 

Bronze 
Pieces  Value 

Coined  1st  Jan.-31  Dec,  1920   ?"  -i-TrTO        $223,737 

Coined  1st  Jan.-31  Oct.,  1921    45.452 

Issued  1st  Jan.-31  Dec.,  1920  -  .. 209,085 

Issued  1st  Jan.-31  Oct.,  1921   3,800,000  38.000 


QXTEBEO  HONEY  PRODUCTION 

The  production  of  honey  in  the  Province  of  Quebec  has 
more  than  doubled  in  the  last  seven  years.  From  1.500,000 
pounds  in  1914,  it  has  increased  to  3,8l>0,00()  in  1921.  There 
were  in  the  first  year  of  the  war  only  3,200  fanners  in- 
terested in  the  production  of  honey,  while  to-day  the  number 
of  producers  is  6,3()0,  These  figures  were  given  out  in  an 
address  delivered  by  C,  Vaillancourt,  Chief  of  Honey  Pro- 
duction Branch  of  the  Department  of  Agriculture  of  the 
Province  of  Quebec. 


THE      MONETARY      TIMES 


Volume  68, 


1921  in  the  Mortgage  Loan  Field 

Drop  in  Prices  of  Farm  Products  Resulted  in  Msmy  Cases  in  Failure 
to  Meet  Payments — Life  Insurance,  Loan  and  Trust  Companies 
in     the     Mortgage      Loan     Field — Changes     in     Interest      Rates 

BY  WILLIAM  LEWIS  EDMONDS. 


T  is  generally  conceded  that  1921  was  the  most  trying  year 
in  a  decade  for  corporations  whose  activities  are  centred 
:n  loaning  money  on  mortgages.  While  this  condition  has 
ruled  in  respect  to  mortgages  of  practically  all  descriptions, 
it  has  been  particularly  so  regarding  those  covering  farm 
lands  in  the  Western  Prairies  of  the  Dominion.  Some  of 
the  corporations,  either  because  of  more  careful  discrimin- 
ation or  the  good  fortune  of  having  advanced  loans  on  lands 
which  were  less  affected  by  adverse  climatic  conditions,  ap- 
pear to  have  enjoyed  a  higher  percentage  of  collections  than 
others  on  both  interest  and  principal  account.  That  does 
not,  however,  alter  the  fact  that,  viewed  as  a  whole,  the  sit- 
Hation  has  given  corporations  more  than  the  usual  measure 
of  concern. 

That  the  situation  has  been  much  aggravated  by  the 
developments  of  the  last  three  months  of  the  year  there  can 
be  no  doubt.  In  spite  of  the  effect  of  the  drought  experienced 
in  certain  sections  of  the  country  during  the  early  months  of 
the  summer,  later  climatic  conditions  were  so  favorable  that 
when  harvesting  operations  began  the^est  was  assured  of 
a  crop  that  would  exceed  in  quantity  that  of  any  previous 
year  since  1915.  These  bright  anticipations  were,  however, 
soon  dissipated  by  intermittant  spells  of  excessively  hot  and 
unusually  wet  weather,  which,  while  it  did  not  affect  the 
quantity,  resulted  in  a  serious  lowering  of  the  grades  of  the 
crop  through  the  development  of  either  rust  or  sprouting. 

Depreciation  In  Crop  Values. 

As  a  result  of  this  serious  depreciation  in  the  average 
standard  of  grades,  together  with  the  general  lower  prices 
obtaining  in  the  world's  markets,  the  field  crops  of  the  three 
Prairie  Provinces,  notwithstanding  the  much  larger  yield,  had 
an  aggregate  value  of  but  $479,527,000,  compared  with 
$609,493,400  the  lean  year  of  1920  and  $680,171,200  in  1919. 
This,  compared  with  the  two  previous  years,  was  a  reduction 
of  $129,966,400  and  $200,644,200  respectively.  And  besides 
this  marked  decrease  in  value  of  field  crops  the  farmers  have 
been  compelled  to  accept  very  much  lower  prices  for  live 
stock  sold. 

But  decrease  in  gross  revenue  from  field  crops  and  live 
stock  was  not  the  only  factor  which  diminished  both  the 
purchasing  power  of  western  farmers  and  their  ability  to  meet 
payments  maturing  on  mortgages.  Probably  the  most  serious 
among  other  factors  was  high  cost  of  harvesting.  Harvest 
hands,  for  example,  demanded  and  were  paid  wages  running 
from  five  to  eight  dollars  a  day,  and  comparatively  rare  were 
the  instances  in  which  the  farmer  was  able  to  obtain  labor" 
at  the  minimum  rate.  Labor  employed  in  the  threshing 
operations  was  even  more  insistent,  engineers,  being  strongly 
organized,  refusing  as  a  rule  to  accept  less  than  twenty-five 
dollars  a  day.  Authorities  who  have  carefully  investigated 
the  situation  estimated  that  the  average  threshing  costs  of 
the  western  farmers  for  the  harvest  of  1921  was  ten  cents 
a  bushel  on  oats  and  22  to  33  cents  on  wheat.  When  the 
fact  is  taken  into  consideration  that,  notwithstanding  these 
high  costs,  the  prices  obtained  for  wheat  when  sold  only 
averaged  about  70c.  to  80c.  per  bushel  and  for  oats  13c.  to 
17c.  one  does  not  need  the  service  of  the  professional 
economist  to  define  the  financial  position  of  the  western 
farmer  as  a  result  of  his  experiences  from  the  harvest  of 
1921. 

The  farmers  in  Western  Canada  are  not,  however,  in  a 
more  Invidious  position  than  those  in  the  Western  States 
of  the  American  Union  in  respect  to  either  harvesting  costs 
or  selling  prices  of  product.  Both  are  in  the  same  boat.  And 
as   far   as   facilities   for   financing   the   crop,   the   position   of 


the  Canadian  farmer  has  been  somewhat  easier  than  that  of 
his  confreres  south  of  the  boundary  line.  In  the  United 
States,  owing  to  the  banking  system  being  conducted  by  a 
number  of  small  Independent  banks  with  correspondingly 
small  capital,  the  situation  there  was  rather  serious  until 
the  Government  War  Finance  Boar  dcame  to  the  aid  of  these 
Institutions  with  a  supply  of  funds.  In  WWestern  Canada, 
on  the  other  hand,  the  local  banks,  being  branches  of  large 
and  strong  institutions  centred  in  Montreal,  Toronto  and 
Winnipeg,  were  never  short  of  funds  for  crop  marketing 
requirements.  Taking,  therefore,  everything  into  account, 
unfortunate  as  the  position  of  the  farmers  in  Canadian  West 
may  be,  it  is  on  the  whole  rather  better  than  that  of  those 
in  the  Western  States.  Still  another,  and  a  more  definite 
advantage,  and  one  that  has  greater  potency  in  respect  to 
powers  of  recuperation,  is  that  the  average  productive 
capacity  of  the  farm  lands  of  Western  Canada  exceeds  that 
of  the  lands  lying  south  of  the  international  boundary  line 
by  a  bushel  or  two  per  acre. 

Policy  of  Mortgagees. 

While  1921  was  the  most  critical  year  experienced  tor  a 
decade,  the  general  disposition  of  the  loan  and  life  insurance 
companies  is  to  exercise  as  little  pressure  as  possible  upon 
the  farmers  in  respect  to  the  collection  of  money  due  on 
interest  and   principal. 

"Our  policy,"  remarked  an  executive  officer  of  one  cor- 
poration having  a  large  amount  of  money  invested  on  mort- 
gages in  the  West,  "is  to  give  the  farmers  of  the  Prairie 
Provinces  every  possible  chance  to  get  upon  their  feet  again, 
and  are  prepared  to  go  even  a  little  out  of  our  way  in  order  to 
assist  them  in  doing  so.  Cloudy  and  all  as  the  situation  may 
be  at  present  our  faith  in  the  future  of  the  West  is  un- 
diminished. In  its  Western  Provinces  Canada  possesses  a 
great  heritage.  The  adverse  conditions  obtaining  there  today 
are  due  to  the  concurrent  development  of  a  number  of  un- 
usual circumstances  and  not  to  impairment  of  their  natural 
resources.  The  large  yield  of  the  last  harvest  should  b'j 
sufllcient  to  satisfy  everyone  as  to  that. 

"That  which  is  giving  us  the  most  concern  at  the  moment 
is  the  situation  in  the  southern  section  of  the  western  pro- 
vinces, where  the  series  of  dry  seasons  experienced  have 
demonstrated  parts  of  it  are  unsuitable  for  general  farming 
and  should  have  been  reserved  for  ranching,  for  which  that 
part  of  the  country  Is  admirably  adapted.  As  mortgagees,  it 
is  there  that  lies  the  chief  centre  of  our  trouble  in  respect 
to  collections.  With  mortgages  held  on  lands  north  of  the 
C.  P.  R.,  where  fair  to  good  crops  are  more  regular,  our  diffl- 
culties  in  respect  to  collections  are  comparatively  few.  As 
you  are  no  doubt  aware,  the  seriousness  of  the  situation  In 
the  southern  dry  sections  of  Alberta  has  led  the  Government 
of  that  province  to  appoint  a  commission  to  make  a  survey 
of  them  with  a  view  to  removing  the  farmers  to  lands  upon 
which  the  raising  of  crops  is  more  dependable.  It  is  to  be 
hoped  that  not  only  Alberta,  but  the  other  provinces  simi- 
larly affected,  will  be  able  to  work  out  a  satisfactory  plan 
for  the  realization  of  this  object.  But  strange  to  say  many 
of  the  farmers  affected  are  urging  that  they  be  allowed  at 
least  another  year  to  test  the  crop-raising  possibilities  of 
their  land.  Taking  the  West  as  a  whole  no  one  has  stronger 
faith  in  its  potential  possibilities  than  the  farmers  now 
engaged  in  cultivating  its  soil,  and  our  own  agents  advise 
us  that  an  increased  acreage  was  broken  last  fall  in  pre- 
paration for  the  crops  of  1922.  Taking  as  our  basis  the 
appreciation  which  has  taken  place  in  the  value  of  the  farm 


January   6,   1922. 


THE      MONETARY      TIMES 


87 


lands  over  a  period  of  years,  we  who  have  money  Invested 
In  the  West  feel  that  our  security  has  on  the  whole  en- 
hanced." 

Investments  In  Farm  MortKaKcs. 

That  the  loan  and  life  insurance  corporations  have  a  direct 
interest  in  the  welfare  of  the  agricultural  industry  of  the 
country  there  can  be  no  doubt,  for  aside  altogether  with  the 
sentimental  desire  for  its  development  which  they  share 
with  Canadianp  as  a  whole,  approximately  75  to  80  per  cent, 
of  the  money  they  have  Invested  in  mortgages  Is  upon  farm 
lands.  And  as  compared  with  city  and  town  property  the 
tendency  is  toward  an  increase  in   the  ratio. 

The  exact  amount  of  money  invested  in  mortgages  by 
Canadian  financial  corporations  is  not  ascertainable.  One 
authority  consulted  estimated  the  total  at  approximately 
$300,000,000.  According  to  a  statement  made  at  the  annual 
meeting  of  the  Dominion  Mortgage  and  Investments  Associa- 
tion in  May  last  forty-two  of  the  Ontario  loan  corporations 
had  $143,959,000  invested  In  mortgages  at  the  end  of  Decem- 
ber, 1920.  And  besides  the  large  amounts  invested  by  loan 
companies  with  headquarters  in  other  provinces,  there  are 
also  the  investments  of  life  insurance  corporations,  some  of 
which  are  known  to\  hold  mortgages  to  the  extent  of 
$20,000,000. 

Outlook  for  1B23. 

As  far  as  1922  is  concerned  the  outlook  is  very  much 
obscured  at  the  moment.  One  thing,  however,  appears  cer- 
tain: corporations,  while  on  the  one  hand  keeping  in  view 
their  own  interests  and  on  the  other  hand  the  general  wel- 
fare and  necessities  of  the  Dominion,  are  evidently  bent  on 
exercising  a  closer  discrimination  than  usual  in  dealing  with 
applications  for  mortgage  loans  both  In  respect  to  farm 
lands  and  city  and  town  property,  while  as  far  as  Western 
Canada  is  concerned  a  relatively  greater  preference  will  be 
given  lands  which  are  operated  under  the  mixed  farming 
system,  they  naturally  being  less  subject  to  the  whims  of 
climatic  conditions. 

But  the  situation  Is  by  no  means  being  altogether  governed 
by  conditions  obtaining  in  the  agricultural  industry.  There 
are,  as.  a  matter  of  fact,  many  other  factors  to  be  taken 
into  account.  The  most  outstanding  of  these  is  the  money 
situation. 

Notwilhstanding  the  downward  tendency  which  has 
of  late  characterized  the  discount  on  sterling  exchange, 
there  Is  apparently  little  hope  of  loan  corporations  being 
able  in  the  near  future  to  obtain,  as  In  pre-war  times, 
funds  by  the  sale  of  debentures  in  Great  Britain.  And 
the  situation  in  respect  to  France  is  certainly  better.  Even 
were  funds  In  these  two  countries  available  their  cost 
would  preclude  their  being  profitably  employed  In  Canala. 
This  fact  was  distinctly  brought  home  to  Canadian  loan 
corporations  when  in  November  last  they  had  to  make 
arrangements  in  London  for  re-financing  debentures  then 
falling  due.  As  a  matter  of  fact,  British  capitalists  have 
at  their  own  door  ample  opportunity  for  Investing  their 
surplus  funds  In  high-class  securities  that  will  yield  them 
a  return  of  6*4  per  cent,  or  more.  For  Canadian  loan 
corporations  to  float  debentures  In  Great  Britain  is  prac- 
tically out  of  the  question,  meaning  as  It  wauld,  with  com- 
mission of  one  per  cent,  and  the  discount  obtaining  on 
sterling  exchange,  an  ultimate  cost  of  approximately  8>4 
to  81/,  per  cent.  In  the  early  part  of  the  year  the  corp- 
oration of  London,  England,  had  to  pay  as  high  as  7  per 
cent,  for  some  of  the  money  It  obtained  on  new  bond  issues, 
and  about  the  same  time  the  Credit  Fonder  of  Paris  had 
to  pay  a  similar  rate,  plus  premiums,  for  an  issue  of  long- 
term  debentures.  And  not  only  have  Canadian  loan  corp- 
orations been  practically  unable  for  some  years  to  obtain 
their  usual  supply  of  funds  from  Europe,  but  British 
Investors  have  withdrawn,  because  of  the  premium  obtain- 
ing on  Canadian  funds  in  London,  large  sums  Invested 
In  the  debentures  of  Canadian  loo  corporations.  It  is 
estimated  that  up  to  the  end  of  1920  the  amount  so  with- 
drawn aggregated  $14,500,000,  or  about  35  per  cet.  of 
the  total  amiount  they  held  in  Canadian  loan  corporation 
debentures.     Obviously,    therefore,    the    European    money 


market  is  for  the  present  as  a  dry  well  to  the  loan  corpor- 
ations   of   the   Dominion. 

Hope  is  being  entertained  that  Inrestors  In  the  United 
States  may  ultimately  be  educated  to  turn  their  attention 
to  debentures  of  Canadian  loan  corporation*.  But  to 
cultivate  that  field  to  an  extent  that  will  be  productive 
of  substantial  results  will  take  conslderabe  time.  At 
present  the  Canadian  securltleg  In  which  the  American 
Investor  ■>  i„t..r,.uf<.,!  nr"  Oov-rnraent  and  municipal 
bonds. 

Loan   I  ((ijMnatioii.s   and   Savingn  Deposltli. 

In  one  respect  the  position  of  the  loan  corporations  In 
Ontario  is  rather  better  than  it  was  up  to  about  a  year 
ago.  And  that  is  In  respect  to  obtaining  deposits  from 
the  public,  having  been  empowered  by  the  Legislature  to 
build  up  deposits  to  an  amount  equal  to  four  times  that 
of  capital,  reserve  and  cash,  whereas  previously  the  pro- 
portion was  limited  in  amount  to  an  equality  with  capital, 
reserve  and  ca.sh.  Notwithstanding  the  enormous  Increase 
which  has  taken  place  during  the  last  few  years  In  the 
savings  of  the  Canadian  public  the  proportion  of  the 
deposits  made  with  loan  and  trust  corporations,  when 
compared  with  those  made  with  chartered  banks,  hare 
been    gradually   declining. 

With  the  larger  powers  accorded,  and  the  Inauguration 
of  a  more  aggressive  educational  campaign,  loan  corpor- 
ations sho\iId  be  able  to  obtain  a  larger  proportion  of  these 
savings.  But  on  the  other  hand,  with  the  recent  venture 
of  the  Provincial  Government  of  Ontario  into  the  field 
of  rural  credit  banks,  with  branches  In  ten  of  the  leading 
cities  of  the  province,  an  additional  competitor  for  savings 
has  been   created. 

Outlook  for  Ijoan  Corporation  Debenturea. 

As  far  as  the  sale  of  debentures  of  loan  and  trast 
corporations  is  concerned  the  outlook  at  the  moment  is 
not  altogether  promislng.In  the  first  place,  as  already 
pointed  out,  the  markets  of  Great  Britain  and  France  are 
a  negligible  quantity  for  the  time  being.  But  that  which 
may  be  accounted  the  greatest  deterring  influence  of  all 
Is  the  psychological  effect  which  the  radical  or  class  legis- 
lation of  certain  of  the  Canadian  provinces  has  had  upon 
the  mind  of  investors  both  at  home  and  abroad.  This  Is 
particularly  true  of  enactments  by  the  legislatures  of  the 
Western  Provinces,  the  effect  of  which  In  certain  instances 
has  been  to  curtail,  and  in  some  cases  to  destroy,  the 
security  upon  which   mortgages  were  based. 

When  addressing  the  Dominion  Mortgage  and  Invest- 
ments Association  in  May  last,  Hon.  C.  R.  Mitchell,  treas- 
urer of  Alberta,  Justified  the  action  of  the  Western  Prov- 
inces In  respect  to  legislation  of  this  kind  by  contending 
that  It  was  enacted  to  meet  the  situation  created  by  the 
adverse  crop  conditions  of  the  previous  four  years.  While 
this  contention  may  in  the  opinion  of  the  Western  Legis- 
latures be  sufficient  to  justify  their  action,  to  the  corpor- 
ations holding  mortgages  and  to  the  investors  who  held 
their  debentures  the  legislation  is  In  effect  nothing  short 
of  an  Interference  with  vested  right  and  •  breach  of 
contract. 

As  far  as  the  defaulting  municipalities  In  the  West 
are  concerned,  some  progress  has  been  made  daring  "the 
year  in  awakening  the  respective  Provincial  QovernmenU 
to  the  necessity  of  taking  steps  to  protect  the  InteresU  of 
bond  holders  affected,  and  within  the  last  few  weeks  the 
Governments  of  Saskatchewan  and  British  Columbia  hare 
publicly  Intimated  that  legislation  will  be  enacted  that 
is  designed  for  the  particular  purpose  of  obrlating  In  the 
future  defaults  by  municipalities  within  their  respective 
boundaries.  Although  the  defaulting  municipalities  wer«, 
■as  compared  with  those  who  promptly  met  their  payments. 
but  a  fractional  part  of  the  whole,  their  number  was  suffl- 
cient  to  weaken  the  credit  of  not  only  Western  manici- 
palitiea  in  general,  but  that  of  the  Provinces  as  well. 

With  Ontario  following  the  example  of  the  Western 
Provinces  In  the  establishing  of  rural  credit  systenu  for 
the  specified  purpose  of  providing  loans  to  farmers  at  a 
low  rate  of  Interest,  it   naturally   follows  that  the  effect 


88 


THE       MONETARY       TIMES 


Volume  68. 


will  be  to  further  decrease  the  attractiveness  of  loan  and 
trust  corporation  debentures  to  investors  both  at  home 
and  abroad.  As  one  official  expressed  it:  "With  the  Ont- 
ario Government  in  the  banking  and  loaning  field,  the 
tendency  will  be  to  further  divert  capital  from  the  Domin- 
ion, for  with  the  increase  in  this  form  of  competition,  it 
follows  that  monied  men  abroad  who  have  hitherto  been 
in  the  habit  of  investing  in  the  debentures  of  Canadian 
loan  and  trust  corporations  will  scarcely  be  as  favorably 
disposed  towards  them  as  they  formerly  were." 

Life  Insurance  corporations,  obtaining  as  they  do  the 
bulk  of  their  funds  from  premiums,  and  not  from  the  sale 
of  debentures,  are  naturally  less  affected  by  the  situation 
than  the  trust  and  loan  corporations.  But  while  during 
the  last  few  years  they  have  been  able  to  furnish  an  increas- 
ing proportion  of  the  funds  required  on  mortgages,  it  is 
doubtful  whether  they  will  be  in  a  position  during  1922, 
owing  to  the  general  business  and  financial  conditions 
obtaining  in  Canada,  to  increase  their  activites  n  this 
respect.  It  is  quite  possible,  however,  in  view  ofthe 
increased    demand    for    loans    on    mortguage    likely    to    be 


experienced,  that  a  still  larger  proportion  of  the  business 
may   fall   to   the   insurance  corporations. 

Whatever  the  ultimate  conditions  obtaining  in  Canada 
during  the  new  year  may  be  in  respect  to  the  supply  of 
funds  for  investment  in  mortgages,  1921  certainly  closed 
with  money  tight  and  the  corporations  disposed  to  mark 
time  pending  the  advent  of  a  clearer  atmosphere,  as  a 
result  of  which  some  companies  refused  to  entertain  eppli- 
cations  for  mortgages  on  even  choice  down-town  Toronto 
property. 

Although  rates  of  interest  promise  to  rule  firm  for  some 
time  it  is  the  intention  of  the  loan  corporations  to  keep 
them  down  to  as  low  a  point  as  possible,  and  particularly 
in  respect  to  omrtgage  loans  on  farm  lands. 

"In  our  judgment,  and  in  that  of  other  corporations," 
said  an  executive  official  of  one  concern,  "the  highest  rate 
of  interest  farmers  in  the  West  should  pay  is  eight  per 
cent.  That  is  of  course  where  medium  and  large  loans 
are  entailed.  As  the  preliminary  costs  in  respect  to  loans 
for  small  amounts  are  just  as  high  as  in  the  case  of  large 
ones,  it  follows,  of  course,  that  a  slightly  higher  rate  than 
eight   per  cent,   will   have  to  be  charged." 


Year  of  Reaction  for  Stock  Markets 

But  Latter  Months  Showed  the  Commencement  of  Recuperation — 
Feature  of  the  Year  Was  Drastic  Decline  in  Papers — Textiles  Held 
Firm — Conservative  Stocks  Were  Steady,  While  Banks  Gained  Ground 


EIGHT  months  of  reaction,  characterized  at  times  by 
sharp  movement,  and  four  months  of  spasmodic  recup- 
eration, describes  in  a  sentence  the  experience  of  the  Cana- 
dian stock  markets  last  year.  This  action  is  the  fourth  of 
its  kind  in  the  past  two  decades,  the  three  others  being  the 
slump  of  1903,  the  famous  financial  panic  of  1907,  and  the 
upheaval  of  1914.  It  is  hard  to  say  which  had  been  the 
most  interesting,  for  all  have  had  their  peculiarities  and 
things  in  common,  but  it  is  sufficient  to  say  here  that  with 
the  exception  fo  1914,  they  all  agree  on  the  point  of  recovery. 
It  was  about  one  year  before  stock  prices  began  the  upward 
trend  after  the  1907  panic,  which  was  most  severe. 

Of  course,  the  change  in  1914  was  exceptional,  and 
cannot  compare  with  the  others.  As  a  general  rule  the  re- 
vival following  depression  is  gradual,  but  then  it  was  largely 
a.  case  of  getting  over  the  first  shock  and  reverting  from  a 
peace  to  a  war-time  business  basis. 

It  was  really  in  July,  1920,  that  the  stock  markets  first 
started  to  discount  the  business  depression  through  which 
we  have  just  passed.  During  that  month  business  on  the 
exchanges  was  very  dull,  but  this,  of  course,  was  attributed 
to  summer  quietness.  When  the  big  slump  took  place  in 
August,  however,  the  complexion  of  affairs  had  considerably 
altered. 

But  still,  even  in  the  face  of  the  knowledge  of  the  in- 
tensive inflation  which  had  taken  place,  the  delusion  was 
prevalent  that  liquidation  would  be  only  a  small  matter,  and 
would  take  but  a  short  time  to  complete.  This  idea  was 
encouraged  by  the  movement  of  stocks  both  here  and  in  New 
York,  for  in  addition  to  the  seeming  absence  of  distinct 
bearish  signs,  the  markets  made  spasmodic  attempts  at 
recovery.  The  months  passed  and  it  was  not  until  November, 
when  the  big  downward  swing  really  started,  that  it  was 
realized  that  security  prices  were  to  undergo  severe  read- 
justment. 

On  the  Way  Down 

The  bursting  of  the  sugar  bubble  and  its  effect  upon 
Atlantic  Sugar  at  the  end  of  1920  really  started  the  ball 
rolling.  From  that  time  it  seemed  as  though  scarcely  a  week 
passed  without  some  announcement  of  a  poor  financial  state- 
ment, the  passing,  or  cutting  of  some  dividerd.  These  last- 
named  factors,  however,  were  not  so  common  in  Canada  as 
across  the  line,   where   investors   in   preferred,   as  well   as 


common  shares,  not  only  lost  their  incomes,  but  were  forced 
to  witness  a  contraction  in  their  principal  bf  large  dimen- 
sions. 

Then  came  the  Riordon  disaster,  which  carried  the 
whole  market  down  sharply,  paper  stocks  suffering  the  most. 
After  such  incidents  as  these,  the  market  would  invariably 
halt  for  a  while,  and  in  some  cases  recover  a  little,  due  per- 
haps to  the  fact  that  the  sentiment  of  traders  was  out  of 
proportion  to  what  it  really  should  have  been. 

This  continually  brought  out  reports,  sometimes  by  prom- 
inent bankers  and  investment  brokers,  that  prices  were  at 
the  bottom,  or  nearly  so.  Of  course,  when  subsequent  events 
showed  further  declines  of  substantial  proportions,  the  con- 
fidence of  the  speculative  public  was  further  undermined. 
The  small  man  was  particularly  affected,  often  being  shorn, 
and  left  without  funds  to  take  advantage  of  the  new  low 
levels.  Thus,  for  several  months  the  markets  were  char- 
acterized by  unnerving  uncertainty,  with  traders  very-  dis- 
trustful and  moving  cautiously.  All  the  while  prices  were 
moving  downward,  sometimes  sharply,  and  at  others  slowly. 

Recovery  in  the  Fall 

With  the  passing  of  the  summer,  however,  came  a 
change  in  business,  slight  though  it  was,  and  its  consequent 
effect  upon  security  prices.  First  there  was  the  tendency 
to  overlook  individual  bearish  factors,  and  to  concentrate  on 
the  good  possibilities,  and  there  were  such  things  as  the 
pause  in  the  downward  sweep  of  commodity  prices,  easy 
money  rates,  increased  efficiency  in  labor,  and  a  better  under- 
standing between  employer  and  employee  on  the  question  of 
wage  reductions,  the  picking  up  of  the  steel  industry,  one 
of  the  best  barometers,  and  the  prospects  of  a  fairly  good 
crop,  to  inspire  confidence. 

The  early  fall  months  saw  the  beginning  of  the  upward 
trend,  as  signs  of  business  improvement  grew  stronger.  But 
the  movement  since  that  times  has  not  been  steady,  but 
rather  spasmodic,  with  slight  reactions  in  between.  Two 
things  which  contributed  to  a  better  feeling,  perhaps  more 
than  anything  else,  for  after  all  we  usually  look  for  guidance 
to  our  southerly  neighbors,  were  the  acceptance  of  lower 
wages  by  United  States  railroad  employees,  instead  of  a 
serious  strike,  and  the  increasing  movement  on  the  part  of 
American    manufacturers    in    the    establishment    of   branch 


January  6,   192:;. 


THE      MONETARY      TIMES 


H^ 


plants  in  Canada.     This  was  the  renewal  of  the  movement 
started  before  the  depre.ssion. 

The  year'.s  harvest,  on  the  whole,  was  good,  and  in  all 
probability  the  yield  will  .show  an  increase  of  .several  million 
bushels  over  that  of  1920,  when  the  final  figures  are  com- 
pleted. But  the  real  stimulating  effect  which  the  harvest 
should  have  had  was  absent,  because  of  the  serious  decline 
in  prices  which  cut  into  farmers'  profits,  and  in  a  number 
of  cases  actually  involved  loss  on  the  .season's  operations. 

Utility  Stocks 

A  good  deal  of  attention  was  given  during  the  year  to 
utility  securities.  Companies  engaged  in  this  line  of  business 
were  among  the  first  to  suffer  from  the  rise  of  labor  and 
commodity  prices  and  adverse  conditions  arising  from  the 
war,  and  have  given  evidence  in  their  earnings  for  the  past 
few  months  that  they  are  among  the  first  to  recover.  This 
is,  of  course,  due  to  the  cut  in  labor  and  material  prices  in 
recent  months. 

In  addition  to  this,  power  companies  have  suffered  less 
from  reduction  of  consumption  of  their  output  than  many 
other  lines  of  industry,  because  the  basic  fact  in  connection 
vvith  power  securities  is  that  the  product  of  the  companies 
is  almost  a  universal  necessity,  and  the  demand  for  it  con- 
tinues steadily  through  both  prosperous  and  lean  years.  The 
following  figures  show  the  trend  of  five  of  the  principal 
utility  companies'  stock: — 

Open  Jan.  Close  June.  Close  Oct.  Close  Nov. 
Brazilian   ....       34%  27  24%  26% 

Detroit  Ely. . .       89  65  65^2  70 

Toronto  Rly.  .        63 '4  71  69 Vj  64 

Quebec   Rly...       21%  24%  24  24% 

Winnipeg  Rly.       40  33  38  36 

It  will  be  -seen  that  prices  were  very  irregular,  and  this 
was  due  largely  to  the  individual  interests.  Toronto  Rail- 
way for  instance,  fluctuated  according  to  the  speculations 
made  in  connection  with  the  taking  over  of  the  company's 
property  by  the  city.  Detroit  Railway  was  also  affected  by 
considerable  talk  concerning  the  possibility  of  civic  competi- 
tion. As  a  whole,  however,  utility  securities  on  this  con- 
tinent command  a  better  position  than  they  had  previously, 
with  good  prospects  of  further  betterment. 

Fall  in  Papers 

Without  a  doubt,  the  feature  of  the  year  was  the  drop 
in  the  price  of  pulp  and  paper  stocks.  Two  years  ago  when 
the  pulp  and  paper  industry  was  beginning  to  reach  the 
height  of  its  boom  there  were  very  few  who  could  foresee 
the  drastic  slump  which  has  taken  place  in  this  securities. 
Even  the  companies  themselves  were  unable  to  see  that  far 
ahead,  for  most  of  them  continued  their  ambitious  programs 
of  expansion. 

At  the  beginning  of  1921,  when  the  trend  of  all  stock 
prices  were  distinctly  downward,  and  the  decline  in  the  paper 
group  was  temporarily  delayed,  due  to  the  sentinient  which 
then  prevailed,  there  were  some  who  believed  these  securities 
should  not  suffer  declines  as  large  as  those  anticipated  in 
other  stocks.  The  reasons  advanced  for  such  predictions 
were  the  secure  market  for  pulp  and  paper,  the  immense 
resource.-;  of  this  country,  the  shortage  in  other  countries, 
especially  in  the  United  States,  and  the  strong  business  and 
financial  position  of  the  Canadian  companies  represented  on 
the  stock  exchanges. 

The  confidence  of  investors  was  somewhat  shaken,  how- 
ever, after  one  or  two  things  came  to  pass.  First  came  the 
stagnation  of  the  market  for  pulp  and  paper,  then  the  cut  in 
prices,  strikes  at  many  of  the  mills  and  increasing  competi- 
tion from  abroad.  All  these  things  niade  pulp  and  paper 
.securities  less  desirable  to  hold,  and  the  .sentiment  concern- 
ing the  strength  of  the  business  and  financial  position  of 
the  companies  was  not  improved  by  the  condition  into  which 
the  Riordon  Company  ran,  and  the  inability  of  two  of  the 
newer  organizations  to  meet  their  obligations. 

As  a  consequence  of  all  this  prices  were  carried  to  ex- 
tremely low  levels,  as  compared  with  1919  and  1920.  The 
following  figures  will  illustrate  the  trend  of  several  of  the 
most  important  stocks  since  the  beginning  of  1921: — 


Open  Jan.  Close  Jane.  Close  Oct.  Cloxe  Nov. 

Abitibi   55%  26%  32  31% 

Brompton    ...       53  23%  25  25 

Laurentide    .  .       94  76%  78%  76% 

Price  Bros.  . .     250  30  38  36 

Riordon   135%  13  5  6 

Spanish  River      87%  50  68%  65 

In  taking  the  decline  in  Price  Bros.,  the  five  to  one 
.split  must  be  taken  into  consideration.  It  will  be  seen  that 
some  fairly  good  recoveries  were  made  in  the  fall.  The  big- 
gest declines  were  in  Abitibi,  Brompton  and  Riordon,  all 
three  of  which  suspended  their  dividends.  The  Wayagamack 
company  also  deferred  payment. 

Steel  stocks  suffered  a  big  setback  during  the  year,  dne 
to  the  conditions  which  prevailed  in  the  industry,  not  only 
here  but  all  over  the  world.  Production  was  at  low  ebb 
during  the  greater  part  of  the  year.  The  movement  of  the 
two  principal  stocks.  Dominion  and  Nova  Scotia  Steel,  waa 
influenced  to  a  considerable  degree  by  the  formation  of  the 
British  Empire  Steel  -  Corporation.  The  .securities  of  the 
merged  enterprises  were  listed  on  the  exchanges  about  July, 
and  for  the  most  part  moved  around  8  and  9,  that  is  the 
common  stock.  Steel  Company  of  Canada  dropped  from  62% 
at  the  beginning  of  the  year  to  48  in  June,  but  before  the 
year  was  out  the  loss  had  been  more  than  regained. 

Textiles  are  outstanding  because  of  their  apparent  dis- 
regard of  the  general  trend  of  the  market.  Some  ground  was 
lost  by  one  or  two  of  the  companies,  but  the  position  as  a 
whole  indicates  strength  and  stability.  It  might  be  inter- 
esting to  note  the  trend  of  four  of  the  principal  concerns: — 
Jan.  Open.  Close  June.  Oct.  Close.  Nov.  Close. 

Can.  Cottons    76  67  80  82 

Dominion   Textile.      107  126  138  140 

Montreal  Cottons.       75  80  80  76% 

Wabasso   46  41%  48  61 

Conservative  Sociuitiee 
There  are  some  stocks  on  the  exchangees  which  are 
known  as  conservative  securities,  that  is  those  which  are 
noted  for  their  steadiness  and  their  investment  possibilities. 
Looking  over  the  list  shows  why  it  is  that  these  are  so-called, 
for  the  record  in  the  past  year  has  been  good,  although  some 
have  suffered.     The  following  figures  are  illustrative: — 

Preferred.         Jan.  Open.  Close  June.  Close  Oct.  Close  Nov. 
Canada    Cement..       90  84  87  89 

Steel    of   Can 89%  86  90%  91 

Can.  Steamships. .       73  45%  64%  62% 

Mackay  Cos 65  60  61  6S 

Maple  Leaf   145  96  95%  97 

Common. 
Bell  Telephone   ..     100  103  104  106 

Can.  Gen.  Electric     100  105>"i  95  96% 

Can.  Pacific    140  122%  124  132% 

Consumers  Gas  . .     127  132  136%  142 

At  the  end  of  September  last  the  return  to  the  investor 
on  most  of  these  was  considerably  above  what  it  was,  soy, 
three  years  previous.  Bank  stocks,  which  may  also  be  termed 
conservative   securities,   closed   stronger. 

While  speaking  of  banks,  it  is  perhaps  opportune  to 
speak  of  the  relation  of  call  loans  to  the  st(x-k  market.  In 
times  like  we  have  just  pa.-;sed  through,  easiness  of  money  is 
a  secondary  factor  to  the  market,  but  still  it  is  worth  notic- 
ing, and  Wall  Street  seems  to  be  the  best  index.  Betn-eeo 
July,  1919,  and  August,  1921,  there  was  a  decline  in  brokers* 
loans  from  $1,750,000,000  to  $500,000,000.  There  was  a  de- 
crease in  Canada,  but  not  quite  so  severe.  These  facts  will 
explain  why  it  was  that  call  rates  fell  as  low  as  4%  per 
cent.,  in  New  York.  It  was  only  natural  that  there  shoold 
have  been  a  decline  in  call  loans,  in  view  of  the  great  im- 
pairment in  security  values. 

For  the  first  time  since  June,  1919,  there  was  a  turn- 
over of  shares  of  the  Mexican  Light  and  Power  Company  oa 
the  Toronto  exchange  in  September  last  The  number  of 
shares  changing  hands  wa-s  identical  with  that  two  years 
ago,  namely,  twenty-five,  but  there  has  been  a  big  deprecia- 
tion in  price,  the  pre.sent  value  being  7,  as  compared  with 
48  in  1919. 


90 


THE      MONETARY      TIMES 


Volume  68. 


MONETARY  TIMES^  ANNUAL  STOCK  EXCHANGE  RECORD 

MONTREAL    STOCK    EXCHANGE— Prices     and     Sales     in     1921 


GENERAL 

Abitlbl 

Ames-Hold  en-M 

cCready 

Asbestos  Corporation 

Com^mon 

V     Preferred 

C 

ommon 

Prefe 

rred 

Co 

Timon 

Preferred 

High. 

L.OW. 

Sales. 

High. 

Low. 

Sales. 

High. 

Low. 

Sales.              High.   Low. 

Sales. 

High. 

Low. 

Sales. 

High.   Low. 

Sales. 

January     . .     .  . 

.      58 

B2% 

9,002 

89 

S6 

130 

25 

20 

295                45          30 

500 

82% 

77 

500 

95          88% 

799 

Febl uary 

.      64 

33 

46,327 

89 

87 

25 

24 

24 

1                35          29% 

715 

81 

74% 

457 

94          90 

1,050 

March 

.      44H 

35% 

28.426 

87 

84% 

42 

30          2 

7 

243 

78% 

72% 

984 

90          89 

289 

Ap-il 

4tl 

30 

13,532 

86 

85 

111 

16 

is 

■.30                27          21% 

161 

73% 

67 

1,712 

90          78 

926 

May 

■      37V4 

32 

9,279 

87 

85 

190 

16 

15 

16                22          19 

130 

64 

58 

1,318 

83          80 

306 

June 

.      36% 

22 

18,327 

85 

83 

60 

20          19 

25 

60 

39% 

550 

79          71 

404 

July 

.      28 

24 

5,666 

24          15 

462 

48 

45 

620 

77%      76 

469 

August 

32 

2614 

9,109 

85 

85 

10 

16% 

is 

106                36          22 

363 

48%° 

36 

1,627 

77          67 

675 

September    .     . 

.      31% 

26 

6,706 

86 

86 

275 

28          26 

186 

48 

40 

1,827 

72          65 

449 

October.  . 

.      33% 

29% 

7  768 

85 

83% 

123 

27%      27 

226 

62% 

42% 

2,892 

80%      70 

452 

November     .     . 

.      33% 

30% 

3,934 

86 

86 

20 

27          26 

76 

61 

56 

1,429 

80          78 

260 

'  'QBNBRAI>-Continued 

British 

Colu 

mbia 

Atlantic   Sugar 

Brazilla 

n 

Fishing 

and 

Comnion 

Preferred 

Bell 

releph 

one 

T.  L. 

&  P 

Co. 

Packing 

Co. 

High 

Low. 

Sales. 

High. 

Low. 

Sales. 

High. 

Low. 

Sai-;s.               High.   Low. 

Sales. 

High. 

Low. 

Sales. 

High.    Low. 

Sales. 

January    . .     .  . 

.      33 '4 

20% 

16,136 

112 

99% 

1,210                36          31 

5,134 

44% 

39 

330 

February 

.     33  y. 

25% 

11,636 

34 

34 

60 

109 

105 

619                35%      32 

8,416 

46 

40 

316 

March 

.      33% 

29% 

6,695 

108 

103 

431                33%      32 

4,289 

42 

40 

245 

April 

.      32% 

28 

6,789 

108 

103 

1,461                32          29 

6.182 

41 

39% 

236 

May 

.      33 

29 

6,212 

106% 

103 

2,523                34%      2!) 

11.006 

38% 

38 

166 

June 

.      30-4 

23 

3,816 

38 

38 

"so 

103 

101 

1,331                31%      24% 

11,240 

38% 

85 

66 

July 

.      28 

28% 

1,599 

104% 

103 

1.079                27%      : 

0 

6.894 

33% 

31 

230 

Augruat 

.      2S 

24 

3,651 

106% 

103 

886                24%      22 

3,039 

30 

20 

360 

September    .    . 

.      30% 

24% 

9,624 

106% 

104% 

444                26%      22 

2,024 

21 

18% 

220 

October 

.      32 

28 

10.824 

106 

104 

351                24%      22% 

3,069 

22 

20 

277 

November    .     . 

.      33% 

30% 

18,488 

106 

103 

783                26%      24 

5  702 

26 

20% 

290 

GENERAT 

1— Continued 

British    Empire  Steel 

Brompton 

Canada 

Cement 

Common 

1st  Preferred 

2nd 

Perferred 

New 

Stock 

Common 

Preferred 

High. 

Low. 

Sales. 

High. 

Low. 

Sales. 

High. 

Low. 

Sales.              High.   Low. 

Sales. 

High. 

Low. 

Sales. 

High.  Low. 

Bales. 

January    . .     . . 

I 

9          61 

31,804 

60% 

66% 

6,607 

94          90 

266 

February    .  .     . 

53          34 

63.114 

62 

56% 

6,706 

93%      91 

395 

March 

37          34 

15.408 

61 

58 

4,626 

92          90 

340 

April 

34%      29% 

18.047 

69% 

56 

2,638 

91%      89% 

424 

May 

'.      '9V4 

'8% 

622 

36 

30% 

89                37%      32% 

14,068 

66% 

50% 

6,642 

90          8 

9 

363 

June 

9% 

8 

1,816 

31% 

18 

1,397                36          20% 

10,114 

54 

46% 

6,490 

89          83 

1,061 

Juiy 

9^4 

8 

614 

26 

21 

i>74                23          19 

4,568 

62 

48% 

1,460 

84          81 

184 

Au^us'         . ,    . 

.      1214 

8% 

1,611 

66 

66 

250 

25 

23 

1  304                22%      14% 

6,471 

62 

48 

1,486 

84          81% 

198 

September    .     . 

.      10,% 

9 

462 

66 

66 

26 

23 

1,076                22%      13 

10.025 

56% 

60 

1,460 

86          83 

190 

Ootobei .  . 

.      10 

8 

976 

62% 

66 

'222 

24 

21 

1,304                27%      20 

11,010 

59% 

55 

1,691 

89%      85 

367 

No\  ember     .     . 

.      10 

8 

1,366 

60 

68 

334 

26 

21% 

3,156                27          23 

'.135 

67% 

56% 

1,408 

90          86% 

494 

OBNERAL— Continued 

Canadian 

Consoll- 

Canada 

Steamship    Lines,    Llm 

Ited 

Canadian    Car 

and    Foundry 

dated   Rubber 

Oo. 

Common 

Preferred 

Voti 

ng  Trust 

Jommon 

Pre 

ferred 

Preferred 

High. 

Low. 

Sales. 

High. 

Low. 

Sales. 

High. 

Low. 

Sales.              High.  Low. 

Sales. 

High. 

Low. 

Sales. 

High.  Low. 

Sales. 

January    . .     .  . 

.      6014 

46% 

4,657 

74 

68 

1,301 

47% 

47% 

76                43          31 

1,369 

79 

69% 

863 

Febrtiary    . .     . 

.      46 

28 

20,699 

71% 

66 

2.561 

39          80 

245 

76 

70 

1,160 

March          . .    . 

.      32 

28 

3,267 

67% 

64% 

1,011 

29% 

2914 

100                87          31 

16,184 

70% 

66% 

10,677 

88          88 

9 

April    .. 

.      80 

19 

7,000 

65 

38 

7,061 

21% 

21% 

10                83          30 

495 

67 

61 

642 

91          90 

26 

May 

.      S7 

21 

4.861 

58 

40 

6,704 

26 

24% 

176                80          80 

190 

61 

66 

230 

Jime 

.      !SU 

17 

2,118 

56 

43 

2  789 

66 

48 

229 

July 4. 

.      20 

18% 

300 

49 

44% 

742 

'.'.".                 26%      26 

"so 

64 

48 

429 

AngUBt  ...     . 

.     28% 

19 

8«7 

65 

49 

2,730 

18% 

18% 

35                26%      26% 

26 

54 

49% 

245 

September 

.      21 

18% 

686 

56 

50 

1,832 

26          20 

60 

63 

48 

420 

66          66 

ioo 

Octobtr. . 

.      20% 

.18% 

624 

55 

60 

4,12T 

20          16 

736 

47 

42 

1.904 

November    .     . 

.      19 

17% 

646 

66 

61% 

2,760 

..    .                22%      19 

880 

62 

46 

1.277 

186        136 

i 

OENERAL  -Continued 

Canadian 

Canadian    Cottons,    Limited 

Fairbanks- Morse 

Canadian  General  Electric 

( 

3anaaiai! 

Converter* 

Common 

Preferred 

Preferred 

Common 

Fractione 

High. 

Low. 

Sales. 

High. 

Low. 

Sales. 

High. 

Low. 

Sales.              High.  Low. 

Sales. 

High. 

Low. 

Sales. 

High.   Lffw. 

Bales. 

January    . .     . . 

.      66 

69 

614 

77 

73 

576 

72 

70 

134                67%      65% 

106 

104 

94 

697 

February    . .     . 

.      65 

60 

167 

80 

78 

208 

74 

72% 

210 

110 

103 

1,182 

March 

.      60 

58 

161 

T7 

77 

50 

77 

77 

83 

117% 

109% 

3,284 

April 

.      64 

68 

473 

76 

68 

213 

76 

74% 

64 

110% 

106 

1,131 

May 

.      70 

61 

367 

72 

68 

382 

76 

74 

242 

113% 

107% 

566 

June 

.      67 

69% 

882 

71 

70 

110 

77 

76 

24 

113 

105 

1,056 

-Tuly 

.      6814 

60 

111 

67 

67 

5 

75 

75 

20 

107 

84% 

360 

.^UKUSt             .  .     . 

.      66 

60 

234 

66 

68% 

270 

76 

74 

S'2 

96 

87% 

1,804 

September    .     . 

.      67 

62% 

686 

77 

62% 

677 

76 

74 

39 

97 

92% 

877 

96          96 

'2/6 

October 

.      74 

67% 

468 

80 

74 

1,060 

76% 

75 

48 

96 

93 

2,089 

96          94 

4/6 

November    . 

78 

69% 

705 

86 

80 

420 

80 

75 

28 

96 

90 

2,205 

OENERAIi—Contlnued 

Canadian 

Locomotive 

Canad 

an  Pacific 

Carriage 

Factories 

City  of  Montreal 

Cenxmon 

Preferred 

Railway 

Coi 

nmon 

Preferred 

7%    Stock 

High. 

Low. 

Sales. 

High. 

Low. 

Sales. 

High. 

Low. 

Sales.               I 

Ilgh.  1 

.jOW. 

Sales. 

High. 

Low. 

Sales. 

High.  Low. 

Sales. 

January 
February 
March    . . 

April 

May 

Jun©    . .            .  • 

81 
89 

83 
82% 

18 

30 

136% 
131% 

135% 
130% 

i 

11 

20 
15 

12 
16 

166 
"35 

8414 

8414 

ii) 

10 

10 

66 

66 

66 

io 

.'     74% 

74% 

"20 

129% 

129% 

"28 

13 

10 

175 

128 

118% 

61 

lii       lil 

i« 

Ju'.y 

.... 

128 

124% 

19 

,   , 

126 

186% 

46 

'9 

9 

"26 

September    .    . 
OctobAr 

.. 

;;;; 

79 
80 

79 
80 

"6 
1 

126        121%       "66 
135%    126               74 
QHNBRAIi  -Oont^net 

9 

8% 
10 

9 

8% 
10 

16 

5 
15 

November    .     . 

:::: 

Cons. 

Mining  & 

Smelting  Co. 

Detroit    United 

Dominion 

Canners 

|2li   Par 

Detroit    tjnlted 

Fractions                    Do 

mlnloi 

1  Br 

Idge 

Common 

Preferred 

High 

Low 

Sales. 

High. 

Low. 

Sale*. 

Htgliu 

liOW. 

Sales.             I 

Ilgh.  ] 

LiOW. 

Sales. 

High. 

Low. 

Sales. 

High.  Low. 

Sales. 

January    . .     . . 
February    . .     . 
Maich 

.     21 

17% 

8,790 

91 

88 

891 

92 

S6 

981 

45 

34 

4,090 

80         80 

10 

.      21 

18 

1,707 

96 

86 

868 

SO 

i3 

739 

41% 

30 

1,322 

19 

16% 

1,778 

86 

80 

1,740 

, , 

! ! . . 

84 

78 

470 

81 

26 

1,470 

80          79% 

"ss 

April 

May 

June 

July 

A ugruBt  . .    . . 
September    . 
October 

16% 

15 

5,142 

80% 

71 

8,871 



!0% 

:o 

1,110 

29 

25 

622 

79          79 

22 

.      17 

16 

1,797 

84% 

74 

2,361 



84 

69 

776 

26 

24 

10 

78%      78% 

30 

.     1614 

12% 

2,737 

79 

63% 

1,969 

78 

68% 

295 

76 

S4 

1,805 

26 

19 

1,351 

80          80 

16 

14 

18 

644 

64 

68 

444 

65 

69 

27 

?1 

S6% 

673 

22 

20 

670 

\      16 

14 

805 

60 

60 

1,723 

68 

66 

2 

69 

61% 

1,062 

25 

22% 

769 

'.      16 

14% 

804 

59% 

60 

2, 136 

54 

60% 

12 

70 

62 

604 

27% 

23% 

736 

19% 

16% 

3,867 

77 

59 

8,263 

72 

64 

12 

SI 

S9 

2,230 

30 

26 

1  020 

November    . 

.      19% 

18 

8,006 

72 

56 

4,553 

69 

62 

79 

78 

986 

27 

26 

170 



January  6,  1922. 


THE       MONFTARY       TIMES 


II 


MONTREAL    STOCK    EXCHANGE— Price,    and     Sale,     in     1921 


Domin 

Ion    Coal 

Preferred 

High. 

Low, 

Sales. 

January 

.  .      78 

63"^ 

283 

Febru;ir\- 

7!l 

77  H 

80 

Mar.-li 

78 

77  >^ 

35 

Aiirll 

78 

76 

71 

May 

77 

76 

6 

June 

74 

74 

5 

Ju.y 

«6% 

66% 

5 

Au;rUHl    .  .     .  , 

..      «7^4 

67 

!I6 

St*ptomb(T 

(;7 

65 

413 

Octobe.-.  . 

.  .      75 

75 

180 

Ncivi'mhcr 

7) 

74 

26 

Dominion 
Common 
High.  I.nw.  Sa-len. 

January     Ill        10314      1,381 

P  bruary  .    112        10614      2.097 

Maich 122V4    109%      2,027 

April     120        117  1,589 

M->y 138        118  3.840 

Juno 137        123  2,814 

July 12714    126  431 

AuifUSt 135        128  440 

Septenbcr  ..    140        131  1,70S 

October..  ..    138        135  91<1 

November    .     ,.141       13714     1,177 

Howard   Smith 
Common 
High.   Low.   Sales. 

January     110        100  282 

February     ..      .110  8714      1,294 

March 100  87  1,660 

April 90  80  2,619 

May 84  80  1,171 

June 77  66  1,268 

July 70  ec"        1,631 

AusuBt G9%      65  463 

September    ...      72  69  610 

October 7714     68  600 

Novvmher     ...      80  77  192 


Kamlnlfitlua 
Power 

High.  Low.  Sales. 

January    93         87  104 

February                    9214      9014  60 

March 90          88  36 

April 92           91  27 

May .  .  .... 

June            88          86  20 

July 86           86  24 

August 80           80  8 

Septtmbev     ...      80         80  15 

October..                  8114     80  166 

November    ...     82         SO  21 

Maple    Leaf 

Milling  Co. 

Preferred 

High.   Low.   Sales. 

January    9514      9614  10 

February .... 

March .... 

April 

May .... 

Juno 90  96  100 

July .... 

August .... 

Septombei-    .     ..     9614     9614  60 

October 96%      96%  60 

November     .      ..      96%      9614  60 


Montreal 
Tramways 

High.   Low.  Sales. 

January 1S6        125  110 

February    ..       .142        185  396 

March . .  ■  •  •  - 

April 142        140  35 

M.iy  

Juno     136        186  10 

July 126        126  6 

August 126        106  142 

September     .      ,  .    125        126  40 

October.  .             .140        130  1,09B 

November     .     ..140       134  1,126 


Dominion 
Common 

High.  Low.  BalM. 

64  li      56  906 

62          6914  668 

69           65  1,306 

66  52  206 
60          60  1,140 

67  52  809 
6614  52  205 
6514  53  620 
5714  6314  1.800 
6314  6014  6,776 
G2           01  1,485 

Textile 

Preferred 

Hlfth.   Low.  Sales. 

94           89  14  36 

90%      94.  90 

98           »r,  173 

100        100  14 

lOlli    100  30 

103        102  50 

102%    102  183 

102  102  89 

103  102  56 


OBNERAL— CoMUnued 

QIaHH 

Preferred 

High,  Low.  8a.les. 

83  7714  306 
88  80  281 

84  82  220 
82  80  111 
82  81  209 
82  81  96 
8214  8014  90 
8314  8214  271 

85  8214  138 
8614  86  61 
88 ',4  80  283 


Dominion  Iron 
and    Bt««l   Co. 
Preferred 
High.  Low.  Sales 

75  08      2UI 

76  78  240 
76  68  161 
70  67*  201 
««    66       25 

•014    50  :• 

•0  <0  1 

«0  58  60 

67  67  10 

62  56  77 

61%  6*14  14< 


OENEIRAL — Continued 

Goodwins,    Limited 

Common  Preferred 

High.  Low.  Bales.  High.   Low.  Sales. 


6814     II»14 


105 


104 


80 


Paper  Mills 
Preferred 

High.  Low.  Sales. 

92  91  280 

9214  91  95 

90  87  42 

87  78  81 
80  77  847 
73  68  276 

69  65%  118 
68  64  278 

70  60  04 
77  68  626 

88  7S  630 


68 
78 
70 


OBNERAL-  -Continued 

Illinois  Traction 


18  6 

78  6 

70  26 


Common 
High.  Low.  Sales. 


20 

2014 

21 

21 

20 

16 

16 
15 

1714 


12 
19 
20 
21 
19 
16 

16 
16 

16V4 


190 
70 

193 
36 

412 
50 

86 

6 

115 


Preferred 
High.  Low.  Sale*. 


70         06 
7114      69 


71 
71 


68 


70 14      69 
69  8714 


6814 
«8 


68 

69 


•  6 
66 
S6 
«8 
67 


OBNERAL — Continued 


Lake   of    the   Woods    Milling    Co. 


Commor 

I 

Preferred 

1 

High 

.    Low. 

Sales. 

High. 

Low. 

Sales. 

166 

136 

727 

94 

94 

2 

165 

149 

329 

9814 

10 

10 

148 

147 

837 

101 

100 

15 

148 

139 

180 

10314 

10814 

10 

140 

135 

122 

108 

10114 

2r 

186 

132 

279 

103 

101 

86 

184 

12714 

896 

186 

182 

193 

104 

108 

ii 

184 

12714 

266 

104 

104 

6 

139 

126 

219 

147% 

142 

1,140 

10314 

10814 

60 

Laurentlde 
New. 
High.   Low. 
96  91 


92 
88 


83 
81 


9814  8514 

98  88H 

8914  7114 

75  6614 


72% 
73 

81H 
80 


62 
6314 
7014 
76 


808 

58i 

61 

864 

168 

•  6 

60 

»« 

180 

126 

147 


Co. 

Sale*. 

6.869 

18,885 

6,665 

14,688 

10,188 

10,961 

9,681 

18,9*6 

9,6(8 

9,808 

6,841 


GEVERAL—Contlnued 


Montreal  Co'ttonsc,  Limited 


Common 
High.  Low.  Sales. 

85           75  40 

76  70  190 
78     72  243 

77  76  30 
80  78  85 
80  78  280 
7814   78  41 


76 


73 


87 


80  7014  99 


Preferred 

High.  Low.  Sales. 

91  90  38 

96  92  16 
98  91  26 
98  96*  188 

97  96  86 
9614  9614  144 
97%  97  66 

98  97  16 
9814  95  16 

99  98  100 
104  10014  204 


Montreal  L.  : 

*    Powar 

High.  Low. 

86  8114 
8414  81 
88  8114 
84  81% 
8614  82H 
84H  77H 
8814  81 
8814  80 
8814  8014 

87  83 
8814  8814 


Sales. 

10.610 
4,689 
2,441 
7,606 
7,027 
7,883 
4.742 
4.888 
8,746 
8,884 

10,848 


National   Breweries 


OBNBRAI* -Continued 


Common 
High.  Low.  Sales. 
66%      4814 

49 

8614 

86% 

48% 

4414 

4814 

46% 


$100 


63% 

4914 

44% 

6714 

66 

6414 

6414 

66% 

57% 

68% 


81,790 
18,688 
48,698 
16,401 
68,084 
17,887 
9,968 
8,658 
6014  16,648 
52  88,148 
66V4    80,411 


Preferred 
High.  Lov.  Sale*. 


Nova    Scotia    8Im1 
and  Coal  Co. 
Preferred 
High.  Low.  Sales. 


90 
90* 


90 
90* 


80 
6 


8914      89% 


90 


88  80 

88  88 

8814      85* 


80  80 

80  80 


87 

6 
14 


5 
50 


aSNGRAL. -Con  tinged 


Ontario    Steel    Products 

Common  Preferred 

High.  Low.  Sales.  High.  Low.  Sales. 

January  ...     70  68  416  . .  

February    ....     67  66              80  88         88                5 

March 66  68             115  . .           . .            .... 

April 67  62%  196  

May  60  51  260  

June 4814  82           2.274  86          86                25 

July 4814  40  956  

August 50  42              900  80          80                46 

September    .     ..      64%  60.       1,640  

October 55  40  8,420  

November     .      ..      4514  39             696  8414      8414           10 


Ottawa 
L.    H.    *    P. 
High.  I.,ow.  Sales. 

70  70  78 

78%  70  264 

C9%  69  S3 

•9%  «8*  40 

70  «9  11 

68  <5  33 

«9%  «8  84 

(6  60  67 

65  «>  18 

65%  <4  10* 

17  «(%  188 


Penxnana, 
Common 

High.  Low.  Salsa. 

100  95  888 
103  >8  8T8 

108  96  «*t 

101  97%  10* 

108  *6  tro 

100  »6  818 

98  98  (0 

95  98  Itt 

100  tl  *tl 

100  98  Tt 

104  98  886 


Dominion  .tesi 
f*ommon 

■■:      Low.  talM. 

48  i,8*« 

1     -.      41%  »,0S* 

4«          87  14.118 

4814      8<  8.888 

88%      80%  18,8>» 

88          88%  8,82* 

28%      88  1,884 

28          U%  2,41< 

28%      25%  Mit 

28%      84  1,484 

87%      88%  85* 


Corporation 
Pr«f»rTsd 

Blgta.  Unr. 

71%  «4 

71  (7 

"  •»% 

71  *4% 

*i%  §8% 

«2  55 

if%  »( 

57  5C 

i*  (« 

08%  18% 

•  7%  l*% 


5*1 
58* 
884 
884 

118 
82« 
8(8 
»(• 
•88 
1,8*1 
1.887 


Hlllcreat    CoillerlM 
Qommon  Preferrod 


High.  Low.  Sales. 
■   70 


64 

•0 


(8 

60 


HIgb.  Low.  Salss. 


n 

TO 


M 
T« 


180 

79 


N 

50 


56 
•  6 


i* 

SO 


66 
60 


M 

10 


100 
977 


Intarcolonlal   Coal 
Common  Preferred 

HlslU  Utw.  Sales.  High.  l,cm.  telss. 


Lyall 
Construction 
Common 
High.   Low. 
76  47% 


74 

69% 

<6% 

71 

66% 

•  0 

61% 

67 

•8 

70 


64 
67 
•  8 
•1 
•0 
60 
60 
58 
•8 
•t 


Co. 

Bales 

4,^89 

778 

•  46 

185 

982 

150 

85 

265 

8,858 

8,845 

•,880 


Montreal  Loan 
and    Mortgage 
High.  Low.  Sales. 

166        166  "i 


42  40  17S 

88%      88  80* 

38  86  < 


Maclcay 
Companlsa 
Preferred 
aigb.  Low.  Si 

**%    ii% 

•8%      (8% 
•8%     01 


•8  88 

•i%    •8% 
«i       «t 


MoMrskI 
Tslegrapb 
High,  Low. 
111%   110 
114       no 
118 
44 


100 

ITt 
140 


8i 


118 
118 
45 
45 
45 
46 


48 

44 
44 

44% 


»0 

101 

■0 

881 

810 

10 

IT 

8f 


Ogllvte    Floor 
Common 

HIgb.  Low.  Salss. 

207        180  155 

814        800  6<8 

206        1*9  180 

805        801*  147 

204        800  187 

104        1*5  186 

1*6        1*8%  144 

185        170  188 

175        1(5  144 

188        105  T*0 

1*5       188  411 

LImltsd 

Prstsrrsd 

High.  Low.  Salsa. 

87  78  *t 
81  81  10 
85  T*  85 
85  88*  TS 
•  i          80  40 

88  88  10 
88  88  (0 
81         88  ( 

•8         88  "°< 

84          88  4- 


Mills 

Co 

Preferrod 

HIgb 

Low.  Salos. 

100 

808 

101 

»0 

84T 

IfT 

TO 

180 

I«8% 

10* 

108% 

85 

1 

1 

10 

Porto    Bios 

HIch.  L««.  • 

■Ma. 

48%      48% 


48%      48% 
40  40 


0 
10 


92 


THE      MONETARY      TIMES 


Volume  68. 


MONTREAL    STOCK    EXCHANGE— Prices    and     Sales    in     1921 


GENERAL — Continued 


Price    Bros. 
Common.    Old.  Com-mon.   New. 


January  ...   253 

February  . .   248 

Marrh 210 

April 202° 

May ,. 

June 

July 

August 

September 

October 

November 


High.   Low.  Sales. 


250 
248 
210 
202° 


90 

25 

73 

1 


High.  Low.  Sales. 


42  U      37%  750 

38  36  2,405 

37  ,  29%  1,746 
32  '  29%  460 
30  24%  668 
29  25  920 

38  28  926 
38  35  1,185 


Russell    Motor    Car 
Common  Preferred 


High.  Low.   Sales. 


January  . . 
February  . 
March  .  .  , 
April  . .  . . 
May  . .  . . 
June  . ,  . . 
July  ..  .. 
August  . . 
September 
October. .  , 
November 


Shawinigan 
W.  &  P.   Co. 

High.    Low.  Sales. 

January    109%    104  3,134 

February    ..     ..    107%    105  2,599 

March 106        103%  1,236 

April 105>4    102  1,760 

May  109        103%  3,013 

June 108%    100  2,537 

July 103        100  2,169 

August 104%    101%  1,283 

September     .     ..    103%    102  749 

October 105%    103  2.228 

November     .     .  .    109        104  1,849 


High.  Low.  Sales. 


Comnton 

High.  Low.  Sales. 

88  85  25 

85  72  215 

85  83%  166 

85  80  76 

90  80  ,     105 

80  80  5 

85  85  10. 


Prov.    Paper 

Quebec   Rai 

Iway 

Riordon    Pulp    & 

Paper 

Co. 

Preferred 

L.  H 

.  &  P 

Co. 

Common 

Preferred 

High. 

Low. 

Sales. 

High. 

Low. 

Sales. 

High 

Low. 

Sales. 

High. 

LfOW. 

Sales. 

90 

90 

10 

27 

22 

11,290 

160 

126% 

6,734 

80 

80 

25 

99 

94% 

95 

29% 

25 

15,375 

148 

124% 

1,845 

80 

76 

13 

95^4 

96% 

20 

29 

26 

4,872 

129% 

104 

3,349 

73 

73 

6 

26% 

23% 

3,957 

110 

21% 

24,302 

63% 

39 

255 

90° 

90° 

4 

29% 

24 

7,937 

27 

15 

11,993 

40 

33 

252 

28% 

22% 

7,425 

18 

7% 

4,124 

25 

10 

90 

25% 

22% 

1,530 

13 

4 

5,692 

14% 

14  \ 

25 

27% 

24 

4,855 

4 

2 

1,525 

26% 

23% 

3,122 

4 

2 

720 

25 

23% 

3,764 

8 

3 

1.940 

8 

8 

40 

26 

24 

5,248 

7% 

5 

2,182 

8 

7 

54 

GBNEKAL— Continued 

St. 

Lawrence 

Flour 

Mills 

St 

.    Maurice 

Sawyer-Massey 

Common 

Pre 

ferred 

Paper 

Common 

High. 

Low. 

Sales. 

High. 

Low. 

Sales. 

High. 

Low. 

Sales. 

High. 

Low. 

Bales. 

75 

61 

891 

90 

85 

36 

121 

120 

260 

73% 

68 

126 

88 

88 

25 

119 

95 

536 

65 

65 

10 

88 

88 

35 

100 

96 

90 

57 

50 

235 

106 

105 

25 

61% 

51 

86 

85 

85 

26 

99 

96 

115 

61% 

49 

346 

98 

98 

100 

50% 

48% 

196 

52 

60 

381 

95 

83 

265 

51% 

61 

60 

92 

80 

65 

59 

57 

267 

92 

495 

68 

62 

230 

95 

95 

10 

98 

83 

GENERAL — Continued 

Lms    Co. 

Spanish  River  Pulp 

&  Paper 

Co. 

Preferred 

Common 

Preferred 

Voucher 

High.  Low.  Sales. 

90  87  13 

91%  90  67 

95  94  58 

95  90  77 

92  88  23 

92  92  5 

92  92  5 

94  90  14 

90  89  26 


90 


160 


High.  Low.  Sales. 

89%  81  10,626 

82%  71%  13,202 

78%  69%  10,564 

75  67%  11,155 

76%  70  4,476 

70  44  14,200 

56  46%  5,165 

57%  48%  3,320 

58  50  1,261 

70  65  3,037 

09  64  2,371 


High.  Low.  Sales. 

95  90  11.317 

91  83  9  252 

87  79%  7,573 

84  72  7,371 

81%  76%  3.382 

78%  51%  15,831 

62  56  7.388 

66%  66%  9,053 

69  56%  6,964 

77%  65%  7.092 

79  73%  3,342 


High.  Low.  Bales. 


5% 


5%  36 


Steel  Company  of  Canada 
Common  Preferred 

High.  Low.  Sales.  High.  Low.  Sales. 

Jai.liary             ...      64  59%      3,332  91  85  378 

February     ..      ..      63%  61          2,441  93%  92  245 

Maifh 61%  56%      4,689  93  92  212 

April 61  56%      3,482  92%  90  284 

May 60  66          3,426  90%  88  125 

June     ., 57  42%      9,742  90  86  126 

July 49  45%      1,132  89  87  92 

August 51%  44%      3,171  89%  89  113 

September     .     ..      58%  46%      5.578  90  89  46 

October 65  56          7,225  93  90  157 

Novembtr     ...      65  60%      7.432  91%  90%  134 


Tuckett  Tobacco  Co. 

Common  Preferred 

High.  Low.  Sales.  High.   Low.  Sales. 

January     48%  41  350  ..  ..  

February     ....      52  48  360  . .  .  .  

March 50  50                 5  .  .          .  .  .... 

April .  .            ....  .  .            .  .  .... 

May 44  40              190  .  .           .-.  .... 

June 3   9  35              250  ..           ..  .... 

July 36  32                70  82          78%  21 

August 40  34  183  .  .  .  .  

September     ...      40  40                 5  75          75  40 

October .  .            ....  .  .          .  .  .... 

November .  .            ....  .  .          .  .  .... 


Western 
Orocerles 

High.  Low.  Sales. 

January            ...      26  20  480 

Ftbruary     ..      ..      26%  24  381 

March 24%  21  429 

April     22  15  650 

May 18%  17  170 

June 17  16  235 

July 15  13%  115 

August 14  11  255 

September     ...      16  11  982 

October 15%  13%  390 

November     ...      14  12  928 


Hochelaga 

High.  Low.   Sales. 

January    153        151  128 

February     ..      ..156        161  32 

March 156       151  107 

Apiii 152%°152°  14 

May 166        152%°  87 

June     156%    150  265 

July 152        160  63 

August     ..             ..153        160  24 

September    .     ..151       150  36 

October 152        150  285 

November          ..    150        150  34 


Windsor    Hotel 

High.  Low.   Sales. 
146        120  289 


80 

80 

10 

80 

80 

16 

75 

75 

'so 

75 

75 

6 

Merchant 

High 

Low.   Sales. 

182 

168 

703 

179 

174 

313 

180 

174 

420 

179 

169% 

393 

175 

171 

296 

176 

170 

427 

175 

170 

330 

171% 

164 

368 

170 

165 

258 

170 

163 

428 

171 

162 

624 

GENERAL — Continued 

Comra 

Tooke 
on 

Bros, 

Preferred 

Ilgh.  Low. 
57          50 
50          50 

Sales. 
80 
95 

High.  Low.  £ 

75          75 

50          46 
46          43    ■ 
45          43 

130 

25 
20 

70 

65 

37%      37% 

i 

GBNERAI.— Continued 

Twin   City 

High.   Low.  Sales. 
44%      44%  10 

47  46%  70 

46  45-%  75 

52  50  160 


40%      36% 


Wabasso   Cotton 

High.  Low.  Sales. 

48  42%  107 

50  43  47 

50  46  212 

50  45  168 
45%      42  569 

43  41%  128 

41  41  25 

45  40  75 

45  44%  285 

47%  45  529 

51  47%  185 


GENERAL— Continued 
Winnipeg 
Electric 
High.  Low.  Sales. 
40%      39  1.331 

48  39  5,591 

44  41  500 

43  39%      1,*66 

41  39%      1  246 

40  33  225 

33%      31%         288 
35  30%     1,106 

35  30%     2,425 

39%      36%     1,635 
38  35  937 


Woods    Mfg.    Co. 

Preferred 
High.    Low.   Sales. 


80  77 

76%      76% 


60 
37 


65  65  41 
65  63  38 
67    65       60 


BANKS — Continued 
Molsons 
High.  Low.  Sales. 

174  169  245 
ISO  179%  67 
180  179  103 
180°  177  102 
178   176  50 

177  174  84 
155   174  46 

175  174  49 
174   173  29 

178  173  32 

179  176  15 


Montreal 

High.  Low.  Sales. 

212    196  6  32 

210   205  502 

207%  203  328 

210   202%  62 

208   203  145 

208    199  9 

208%  198  616 

207  202  217 
210  204  267 
212   208  414 

208  206  808 


Toronto  Railway 

High.  Low.  Sales. 

69%  59%  3,846 

73%  67  3,127 

69  66%  891 

7H4  66  2,160 

72  68%  772 
80  69%  6,806 
75  68%  943 

73  68%  1,134 

74  68%  1,850 
73%  68%  1,346 
69  61  945 


Wayagamack 
High.  Low.  Sales. 
75 
73 

64% 
64% 
66 
46 
36% 
27 
33% 
11 
40% 


89 


71 
67% 
47 

43% 
44% 
47% 
47 


2,548 
2,050 
2,231 
4,089 

2.180 
6,537 
5,526 
5,114 
1,470 
1,720 
1.420 


BANKS 
Commerce 
High.  Low.  Sales. 

200        181          ,  536 

190        186%  166 

190        185  182 

187        182  310 

187        184  116 

185        183  170 

185        184  79 

187        184  253 

187        186  189 

187        186  220 

189        184  183 


High.  Low:  Sales. 


High.  Low.  Sales. 


Hamilton 
High.   Low.   Sales. 


180        180 
ISO        180 


172%    171% 
169        169 


I 


^ 

Nations 

le 

Nova  Scotia 

High 

Low. 

Sales. 

High 

Low. 

Sales. 

174 

165 

230 

260 

250 

140 

170 

165% 

41 

261 

260 

82 

261 

256 

175 

180° 

177° 

3 

257 

255 

131 

180 

177% 

3 

265 

253% 

205 

174% 

174 

8 

254 

251 

105 

251 

250 

196 

67 

167 

2 

252 

261 

125 

251 

247 

51 

170 

170 

2 

252% 

260 

80 

160 

160 

20 

255, 

250 

65 

January  6,  1922. 


THE      MONETARY      TIMES 


93 


MONTREAL    STOCK     EXCHANGE— PHce.    and    Sales    in    1921 


Royal 

High.    Low.  Kulod. 

Juuuury              .  .  .  205  1!»:H4  769 

February     .  .      . .  203  200  623 

March 202  "4  200  41)3 

April     202  200  425 

May 204V4  1!01  207 

Juno     203  IU7V4  734 

July lil!H4  IDS  435 

August 200 '^  197  274 

September         ..  199  19  1"^  3S9 

October..            ..  201  196%  602 

November     .      ..  204  199  361 


Ames-Holdftn- 

McCready 
Itlgh.   I,ow,  Sates. 
January  ...       .  .  .  .  .... 

February .... 

March .... 

April 

May 80  68^    11,600 

June 82  82  1.000 

July 78  76        28,000 

August    .  .  .... 

September  .  .       .  .  .  .  , .  .  . 

October .... 

November  .... 


Canadian 
Converters 
High.   Low.   Sales. 

January .  .  .... 

February  .  .  .... 

March 90  90        Jl.OOO 

April 87%      87V4      2  000 

May  96  90        16,000 

June 90  90  1,000 

Julv 

August 91  ?i      91%       1,000 

September  .... 

October. .  .... 

November .... 


Canada 


Standard 
High.    i,ow.   Kales. 
20m    201H  Z 


204%    202 '/4 


Aabestos  Corp. 

High.   Low.   Sales. 

78^4  77^4  J20,600 

80  79  14.700 

66°  78%  4,960 

100'  78  1.026 

lOO"  77%  560 

79  77%  10,300 

93  92  10,600 

100°  73°  1,700 

92  92  5.000 

76  73%  16,600 

78  74  43  200 


Canadian 
Cottons 
High.   Low,  Sales. 

78%  78%$26.6o6 

79  78  2,600 

78  78  1.000 
7814  78  1.500 

79  7814  2.600 
79  79  1.000 
77  77  2.000 

7914  7914  1.666 
7914      7914      1.000 


UA.NKS— Conlinu 
Toronto 
High.    I..OW.  Sales. 

182        182  3 

179%    179%  10 

179        177  i 

182%  182% 

188%  188% 

190%  190%  2 

189  187  114 

BONDS 


Union 

Hl(h.  L.OW.  8al«a. 

1«0  142%  >I4 

11.0  1G7%  120 

158  155  lis 

155%  163  l«i 

164  151  144 

161  148  280 

148  147  «> 

U8  142%  >• 

146  144  93 

146%  144  181 

144  140%  172 


HIrh.  I..OW.  SaUn. 


Bell  Telephone 
High.  Low.  Sales. 

92  9114  $19,000 
92%  9214  4.000 

93  92%  4,500 
93%  92  16,500 
93  92  20.000 
92%  92  5,000 
92%  92%  10,500 
92  91%  27,000 
9214  92  5  000 
9314  91%  20,600 
93%  92  14,000 

BONDS— Continued 

Canadian    Felt 
High.   Low.  Sales. 


88  1,600 


BON  DS — CoD't  I  n  ued 


C»n«a»   C*ment 

Hlsh.  Low.  Sales. 

93  «t%  14,200 

94  93  5,100 
94  93  8.000 
»Z  91%  3,000 
93%  »1%  6,200 
92%  »»  3.100 
92%  92%  7.000 
93%  93%  5,400 
9214  it  14,600 
93  93%  4,<00 
93%  93  1,200 


Canadian 
Locamollve 
Hlvh.  Low.  Sales. 


3400 


Can.   Car  * 
FV>iindr7 
High.  Low.  Salsa. 

•8  88  ioO 

it  li  100 

•0  iO  4,0»« 

90  to  3,000 

•0  t*M  1,300 

13  •>  T.OOO 

•  314      93         7,060 

»i       93       r.ioo 


Calcary    Powar 
Hlch.  Low.  Sales. 


69  69  1.000 


Ball    Talapheoa 
High,    lyrw    8alM 


3<,43T 
».W» 


Canadian 
Coaaolldatad 

Rubbar 
Hifh.   Low.  Saiaa. 
•0         ««     ilt.OM 
*0  M  *.«•• 

M  .  «t  t.(M 
««  t«  I.M* 
Si%  (I  ll.OM 
tt  it  I.t«* 
t(         §4  t.M* 

l(  li         3.0M 

tt  t(  I.tM 
tt  it  l,t«« 
•I         t7  3,*M 


C«4ai 

RapIJa 

High. 

Low.  BaJaa. 

it 

It   IKl.tM 

t7% 

l(%    M.IO* 

•t% 

17        30,«0« 

t*% 

17%    t*.T*« 

t»% 

it        ii.iOO 

it% 

tt         3.0M 

*3 

l*%      T.300 

»1% 

•»%      «.!•« 

*1% 

*«%      ».»•• 

•  1% 

**%   3l.iM 

»«* 

*0%    44.U0 

Steamhlps 

City 

of   Montreal 

Dominion 

Deb. 

Dec.  1922 

Sept.    1923 

May    1923 

Cannera 

Dominion  Coal 

High. 

Low.   Sales. 

High. 

Low    Sales 

High. 

Low.  Sales. 

High.   Low 

.  Sales. 

High.  Low 

Salea. 

High.  Low.  B«l«. 

J.inuiiry 

.      69% 

69%    $1,500 

106% 

96%    $6,000 

98 

98        $3,800 

10«%    103 

$7,200 

SI         86 

$600 

IT         11       ».••• 

February     .  . 

.      71 

70%    14,000 

107% 

105%      5.900 

99% 

99          8,000 

107        105% 

2.100 

17         II         i.i** 

March     .  .     . 

68 

67        27,000 

108% 

103        26.100 

99% 

97%      9.700 

104        103 

1.200 

11%      17         I.M* 

April     ..     .. 

67 

65,%      2,300 

109% 

104%    31,100 

99% 

98%   14.400 

107        104 

19,500 

*•         t*         3.*** 

M  n  y    .  .     .  . 

67 

66%      2,000 

107% 

104        47,900 

99% 

98%         600 

106        104 

3,800 

81%     i« 

2.066 

June     . .     . . 

107% 

106           2.200 

99 

99              '.00 

106%    106 

2.000 

i*       i»       I.i** 

July 

'.      65 

6,6              600 

109 

106           2,400 

99% 

99%      2,000 

108        106 

2,500 

1*       il       1,*** 

Aupust    .  .    . 

66% 

62           8.000 

108 

104%      5,400 

99 

99          1,000 

106        104 

2,300 

*•         «•         I,M* 

September 

i;7 

(SR        ir,.50O 

100 

99          4.100 

108        106% 

1.500 

Octoiber. . 

107 

107          4.600 

99% 
99% 

99          6„>00 

107        104 

6  190 

87%      17% 
87%      17% 

4.0*0 

•*          ••          4.*** 
»•          M          4,*«0 

November 

107% 

106          3,000 

99          3,000 

107        106 

l'«00 

3.000 

BONDS— Contin 

ued 

Dominion 

Dominion  Iron 

Kcimlnlon    of   Canada — War 

Loans 

Cotton 

Dominion    Glass 

and    Steel 

1926 

1931 

1937 

High. 

Low.   Sales. 

High. 

Low.  Sales 

High. 

Low.  Sales. 

High.    Low. 

Sales. 

High.    I^w. 

Sales. 

High.  Low.  Salea. 

January     . . 

.      90% 

96        33,500 

78% 

75      $  6.000 

96%     91% 

$65,600 

94%     90%     llOT.tOO 

•IH     14         1133.31* 

February 

.      9614 

96           8,000 

82 

79%      3.000 

96%     93% 

130,900 

96         93 

38.900 

»l         11%        IX3.3M 

March    ..     . 

.      96% 

9C%      4,000 

81% 

81        49  000 

96%     94 

93.300 

93%     93% 

44,(00 

li         17            414.4** 

Ap-il    .       .. 

81% 

80       26,000 

96%     »4% 

139,800 

93%     93% 

I3(,I00 

17%     16           313.*t* 

May    .        .  . 

'      98% 

97%    46,660 

80% 

77%   71,000 

96.60  94.60 

101.000 

»3.30  93.00 

73.10* 

*T.3S   ill*      14t,S*« 

.Tunc     .  -      .  , 

.      98% 

97%      5,000 

78 

77        47,000 

96.13   94.60 

83,600 

91.10  93.10 

11,700 

97.31  91.31      113.3** 

July      . 

98 

97%      6,500 

80% 

77%   26,000 

96.16   94.40 

78,500 

13.30  *2.60 

I6.C00 

>7.l*  ll.l*        Tl.il* 

AUKUat    .  .     . 

98 

96        11,000 

83% 

80%   14,000 

95.00   94.60 

65.900 

93.00   93.30 

13.300 

IT.**  9I.II      I**.*** 

September 

98 

97%    11,000 

82 

80%      7  000 

96.26   94.50 

104.800 

it.lO   il.90 

15.70* 

I7.TI  il  **     1T*.I** 

October .  . 

93% 
.      98% 

97%    21.000 
97%    26.000 

99% 

99%      1,66 

) 

83 
81 

81        11.000 
81          1,000 

96.35   94.26 
90.00   96.00 

113,400 
80.900 

13.10  13.00 
•  (.to   93.16 

143.70* 
I3S.3** 

•T.**  IT.**       13,11* 

Novetmber 

I*t.»  tT.31     tll.i** 

BONDS — Continued 

Dominion  01 

Canada — Victory  Bonds 

1922 

1923 

1927 

1933 

1937 

I9I4 

High.    Low.  Sales. 

High.  Low.  Sales. 

High.  Low.  SalSales. 

Hlch.    Low 

.  Salea. 

High.   iMvr 

Sale*. 

High.    Low.   Sales. 

Jan. 

9»'^     96% 

3786,550 

99         96% 

$860,700 

99 

95 

$141,550 

98%     94%     |3,464.«00 

100       97 

K09.76* 

97%     »3%  $431.31* 

Feb 

99%     98% 

629,460 

99         97% 

413,450 

99%     97 

178.050 

»«%     98 

i«t.360 

100       91%    1.373  36* 

97         91         4l*.t«* 

March     .     .  . 

98%     98 

407  900 

98%     97 

623.360 

98 

97 

176,400 

»9         97% 

931,(00 

100       »l 

688.30* 

V         91         113.31* 

Apirl 

99         98 

726.700 

98%     97 

394.700 

98%     97 

212.600 

98         9« 

.llt,«00 

99%     »i 

713.01* 

91%     >*         331.71* 

May 

99.50   98.00 

477,150 

98.65   97. 6t 

776.100 

98.60   97  26 

179,400 

98.36   9<.30 

.6«C,500 

9i.l*  11.76 

117,110 

97.11   M**   341.*** 

.1  u  n  e 

99.60   98.25 

749,300 

98.76   97. 7f 

640.100 

98 

75   97.00 

171.  50 

98.00   96. 60      1 

,163,900 

>*.**  91.00 

141.100 

ill*  II.M   tl*.ll* 

.July     

99.16   98.90 

447,360 

98.65   97.75      364.400 

98 

50   97.60 

128,000 

98.00   96.76      1,084.900 

9>.t*  ll.T* 

10*.  IM 

.l.*«  ill*  3IT.M* 

AUKUSt 

99.35   98.50 

691,660 

98.30   97.3 

466.650 

98 

25   97.00 

72.050 

98.00  97.30      1,048.060 

99.60   91.70 

4 II,*** 

iT.3S  *«.*•   314  $*• 

Sept. 

99.05   08.60 

604,750 

98.26   97.1c 

365,750 

98  00   97.00 

130  600 

97.80   07.S6 

899.600 

99.16   11.7$ 

43*.  II* 

*l*l   »l.*«   3I*.li« 

Oct. 

99.20   98. SO 

629,350 

98.40   97.8r 

270.200 

97 

60   96.00 

128.450 

97.75   97.30 

761.760 

99.30   ll.iO 

lit.*** 

IT.M  »l.4*  311  *•• 

Nov. 

99.76   99.06 

669,'850 

99.26   98.0S 

487.600 

100.00   97.00 

249,860 

101.80   97.60      3.030.6I0 

104.00  ii.lt 

4IT.M* 

il.M  IT.**  34 1!:** 

BO.VDS — Conllnoed 

Dominion  Textile  Company 

KamlaiMlq^ 

1934 

A. 

li. 

C. 

D. 

Power 

High 

Low.   Sales. 

High. 

Low.  Sales 

High. 

I«ow.     ale<4. 

High.    I.0W 

Salaa. 

High.  Low 

Salea. 

RIgk.  Lew.  Sale*. 

.Ttinuary     .  . 

..    9f.%      9! 

$1,650,200 

91% 

91%    $1.00 

) 

9!          tl 

t8.000 

February 

.  .    95%      94%      1.060.850 

93          93 

9.6*0 

March    .  .     . 

.  .    96%      94%        920,000 

'•:       1,000 

.... 

Aiirll     .  .     . . 

..    94%      93             844.160 

93 

93           1,76 

) 

93%      66 

3.000 

May     ..      .. 

..    95,76     »i 

.25    1.212.160 

98 

93              36 

) 

•6          94 

4.000 

94           »4 

15,. 

.  .    96.20     93.00    1,300.300 

it 

it      :.oo6 

96          9$ 

1.000 

July    .'.'  ..'.' 
August 

..    95.10     93.85       664,100 

»B% 

9414    3,000 

»«%      »4% 

3.600 

..    95.00     94.00       396.900 

93 

93            '»( 

) 

*l 

tl              250 

•  4           94 

Sept 

Oct 

..    94.76     94.10       731,860 

04          34 

l|*6* 

94.76     94.40       663,300 

94% 

94%      1,56 

) 

«t 

•  i          1. 000 

it         *( 

1.000 

Nov 

99.60     94.60   1.861.000 

95          >414 

(.too 

94 


THE      MONETARY      TIMES 


Volume  68. 


MONTREAL    STOCK    EXCHANGE— Prices    and    Sales    in    1921 


January    . , 

February    

March 

April 

May 98 

June 9S 

July  

August 

September  .  .      98 

October 98% 

November     .     .  .      99 


Lake  of  the  Woods 
Milling    Co. 
Hlg:h.  Low.  Sales. 
96H      95>^    $1,000 


99 


2,000 
2,000 


2,000 
3,000 
2,000 


January 
February    . . 

March    .  .     .  . 
April    .  .     .  . 

May 

Juno 

July 

August 6 

September    ...      71 

October 70 

November  .  .      70 


Montreal    Tram. 
Debenture 
High.   Low.  Sales. 
65V4      63%$44.300 
66        76,200 
66 
66 
68 
65 
65 
65 
67 
67 
69 


66 
70 
70 
74 
72 
66% 


900 

5,600 

19  900 

62,000 

12,700 

2,200 

8,600 

42,300 

34,600 


Ontario  Steel 
Products 

High.    Low.   Sales. 

January    

Pe<bruary 

March 

April S7'^      8714    $3,000 

May       

June 

July 

August 

September 

October.  .  .... 

November 

Sao  Paulo 

High.   Low.  Sales. 

January  .  .  .... 

February    

March 

April 

May 

June 

July  

August 

Septemter 

October 76  75  2,000 

Novembtr .  .  .... 


January 
February    . 
March    .  .     . 
April    . .     .  . 
May    .  .     . . 
June    . . 
July    .  .     .  . 
August    .  . 
September 
October.  .     , 
November 


West 

Kootenay 

High.  Low. 


$1 


Lyall 
Contruction 
Conipany 
High.   Low.  Sales. 


83 


80 
79 
79 


83 


80 

79 
79 


$300 


600 
6,000 
5.000 


70  68        27,600 

77  72        54,800 

National 
Breweries  Ltd. 
High.   Low.  Sales. 


92% 

91% 

91 

91 

95 

96 


92% 

91% 

90 

91 

91 

91% 


$5,000 
2,000 

16,000 
5,000 

30,000 

7,000 

500 


Fenmans 

High.  Low.   Sales. 

85  $26  600 
.  881,4    32,200 

89 

87 

87 

88 

87 

86^4 

85^4 

86  y. 


89% 
89% 
87% 


87 
87% 
86 
86% 


4,600 
18,000 
7,000 
2,600 
1,500 
2,200 
6,000 
1,500 


Sherwin-Williams 

Company 
High.   Low.  Sales. 
96  96  $200 

97%      97%      1,000 
97%      97%      1,000 

97%      97%      1,666 
98  98  2,000 

98  98  1,000 


Windsor  Hotel 
High.  Low.  Sales. 


79%      79%    26,000 


BONDS — Continued 


Montreal 
Power 
High.  Low. 
90%      90 
90  88% 

90  90 


Sales. 
2,000 
4,000 
3,000 


89 
89 


6.000 
1.000 


Nova   Scotia 
Steel  &  Coal  Co. 
High.  Low.  Sales. 


69%      69%  $1,000 


70 

72 
74 


70 


500 


69%     1.600 
TOU      6,666 


Price  Bros. 
High.  Low.  Sales. 


81%      78 
84  84 


83 
83% 


80 


$4,000 
5,000 
3,100 

15,000 
500 


80%      80%         600 
20,000 
Spanish   River 

High.  Low.  Sales. 


87  87       $1,000 

86%      86%      6.000 

Winnipeg 

Electric 

High.  Low.  Sales. 

80      $14,000 

80  2.000 

82%     .'•..000 

80% 

80% 

79 

80 

80% 

82 

83 

86 


80 
80 

82% 

82% 

80% 

79% 

80 

81% 

82 

86 


7,000 
4,000 
5,000 
4.000 
6,000 
7,500 
30,000 
2,000 


Montreal    Light 
Heat  and  Power 

High.   Low.  Sales. 


High. 
92% 


A. 

Low. 

92% 


96% 
96% 
97% 

Queb 
Light 

High 

64 

67 

66% 

64 

65% 

63 

63% 

63% 

63 

63 

64% 


Sales. 

$1,000 

2,000 


1,000 


96  6,000 

96%      4,000 

96%      2,000 

ec  Railway. 

&  Power  Co. 

.    Low.   Sales. 

60      $168,000 

63        122,000 

63  83,000 

62  50,400 

62        231,300 

164,100 

212,600 

106,900 

87,400 

101,000 

261  100 


60 
60 

62% 
62 

62% 
62% 


Steel  Company 

of  Canada 
High.   Low.  Sales. 


95 

96 

94% 

94 

93% 

93 


91% 

94% 

88% 

92 

92% 

90 

92 


$7,800 
8  100 
2,400 
6,000 

23,100 
1,600 
3,700 


92%      92  7,000 

92  92  700 

96%      94  3,100 

Winnipeg   Street 
Railway 

High.   Low.  Sales. 


90        $1,000 


Montreal    Street 
Railway 

High.   Low.  Sales. 
93%      93  2,000 

93%      93%      1,000 
94  94  1.000 


97%      97%    10.000 

96%      96%      1,666 

Ogilvie    Flour 

B. 

High.   Low.  Sales. 

93%      93%    $1,000 


96 
96 


96  9.000 

96  2,o66 

96  98  1,000 

96  96  1,000 

96%      95%      1,000 

Rio  de  Janeiro 

High.    Low.  Sales. 


78%      78%       $500 
72  72  666 


Wabsaso 
Cotton 
High.   Low.  Sales. 
84  84        $5,000 

82  82        19,666 


86  82  1,600 

84  84  600 


High.   Low.  Sales. 


Montreal 
Tramways 
High.   Low.  Sales. 


84 

84 

84% 

84% 

84 


82% 

84 

S3 

84% 

84 

84 


5,000 
1,000 

17,000 
2,000 

14,000 
500 


Sl%      84%      1,000 


High, 
93% 

96 
95% 
96 
96 


C. 

Low. 
93 
94 
96% 
96 


Sales. 
$2,000 

9,000 
26,000 
13,000 

6.000 


Riordon  Paper 

Debentures 
High.   Low.  Sales. 
89  88        $1,600 


Wayagamack 


High. 
78% 
78% 
76% 
77 
78 
76 
75 
74 
74 
70% 
72 


Low.  Sales. 
76    $170,800 


60,600 
16,900 
41,300 
30,000 
22,000 
7,200 
4,600 
18,700 
69%  22,700 
70        86,300 


High.  Low.  Sales. 


TORONTO     STOCK     EXCHANGE— Prices     and     Sales     in     1921 


High.  Low.  Sales. 

January 58  54%  946 

February     ..     ..  62%  46  4,816 

March 44%  36%  2,202 

April 39%  30  2,803 

May 37%  32%  1,099 

June 35%  22%  1,665 

July 29  24%  493 

August     32%  26  812 

S  ptember         .  .  31  26  1,386 

October     83  29%  964 

November    ..    ..  33%  30%  662 

DeceTOiber    ....  31  29%  192 

Satis 17,829 


Abltlbl 
Listed  Sept.   27ht  1920 
Common  Preferred 

High.  Low.  Sales. 
86%      86%  26 


87%      86%  20 


83  83  20 

83%      83%  10 


76 


Ames-Holden-McCready 

Common  Preferred 

High.  Low.  Sales.  High.  Low.  Sales. 

January ..  46%      40%           64 

February ..  33%      30%           20 

March 

April ..  26%      26%              6 

May                  21%      21%           10 

June 

July 17         17               10 

August 

September         29          27               43 

October ..  27          27                 6 

November  .... 

December . .           ....  . .          .  •           .... 

Sales 148 


GBNERAL. 


American    Cyanamid   Co. 
Common  Preferred 


High.    Low.  Sales. 


High.  Low.  Sales. 
62  62  io 

66         60  i6 


American 

Sal 

es   Bo 

ok 

Listed 

July 

,    1920 

Common 

Preferred 

($20    per 

share) 

High.  Low. 

Sales. 

High. 

Low.  Sales. 

77 

70 

116 

6%        6% 

26 

76% 

75 

161 

7            7 

26 

78 

76 

239 

7             6% 

36 

77% 

74% 

144 

7             6 

56 

74% 

72% 

78 

5%        5 

100 

76 

72% 

60 

4%        4% 

25 

76 

73% 

33 

4%        4% 

6 

76 

75 

24 

7S 

71% 

61 

9JT'T 

6St       %ei 

GENERAL — Continued 


Atlantic    Sugar 

Common 

High. 

Low. 

Sales. 

33 

20% 

3,726 

33 

26 

2,401 

35 

SO 

1,168 

32 

27% 

910 

32 

29% 

126 

30 

23 

802 

27% 

23% 

122 

27% 

24 

O20 

30% 

28 

350 

81% 

28 

404 

33% 

30% 

328 

31 

26% 

646 
11,292 

»SS 

OJ 

01 

%6i 

T9S          %9 

6 

Barcelona 

Bell    Telephone 

Brazilian 

Co 

mmon 

iigh. 

Low. 

Sales. 

High 

Low. 

Sales. 

High. 

Low. 

Sales. 

4% 

4 

1,905 

112 

99% 

654 

35% 

30% 

8,524 

6% 

4% 

6,048 

109 

106 

81 

35% 

32% 

1,158 

5% 

6 

1,909 

108 

103% 

306 

33% 

31% 

6,115 

6% 

4% 

665 

108% 

103 

476 

32 

29% 

8.023 

4% 

4% 

63 

106% 

102% 

769 

33 

29% 

8,644 

4 

3% 

603 

103% 

102% 

574 

31% 

24% 

9  763 

4% 

3% 

117 

104% 

102% 

297 

27% 

19% 

9,006 

3% 

3% 

160 

105% 

102% 

245 

24% 

22 

3,158 

4% 

4V, 

286 

106% 

104 

233 

26% 

22% 

2.991 

4 

3% 

366 

106 

104 

117 

24% 

22% 

2,476 

4% 

3^4 

946 

106 

104 

90 

26% 

24% 

4,876 

4 

8 

1,036 

107 

106 

370 

90% 

26 

9.204 

12,981 

4.212 

79,938 

January  6,  1922. 


THE      MONETARY      TIMES 


U 


TORONTO     STOCK     EXCHANGE— Prices     and      Sale,     in      1921 


B.    C.    FlahlnK   & 
Packing  Co. 

High.  Low.  Sale*. 

JnnuMiy     45  3S  396 

February  45%  iOSi  290 

March 42%  41  116 

April 41  40  138 

May 40  3814  72 

JuMfi 3814  35  43 

July 32%  30  SO 

AUKUHt      30  19  212 

•Soptember     ....  20  19  95 

October             ...  21 1,4  19 ',4  128 

November      ....  2Hi  20 ',4  75 

Dofpmbtr    ....  24%  24  60 

Sales 1,693 


CJommon 
High.  Low.  Sales. 


9  »'k  (• 

9%  8 14  112 

9  7  11 

11  8  36 

101/4  9y<  e« 

'9  8V4  166 

9%  8>^  41 

427 


Common 

High.    Low.  Salea. 

January 22  19^  662 

February           .  .  21  19  440 

March 19  17  V4  210 

April 18  16V4  310 

May 2414  17V4  S46 

Juno 21%  19  439 

July 20%  19%  127 

AUBUSt     21  20  142 

September      ...  27%  20%  1.344 

October     .        ...  26%  24  745 

Novembor     ....  29  •H".  1  'ou 

December    ....      27  26  408 

.^alea 7,060 


Canada  Bread 


Preferred 

High 

Low. 

Sales. 

87 

86 

46 

88 

87 

30 

86 

86 

30 

85 

85 

21 

85 

86 

60 

86 

86 

16 

86 

86 

28 

86 

86 

6 

OBNEUAl..— Continued 
British  Empire  Stejl 

1st    Preferred 
High.  Low.  Hales. 


2nd    Preferred 
High.  Low.  Sales. 


58%      68% 
«0%      «0H 


<1 


«0 


<5 

64 

136 


31%  31 

24  20 

23  22 

25%  24 

22%  21 
26 


1»% 
U 

70 
122 
148 
22  45% 

28%      97% 
511 


0E1NE:RAI>— Continued 

Canad*   Cement   Company 


Common 

High.  Low.  Sales. 

66K  56%  772 

61%  67  994 

60%  58  830 

69%  66  560 

66  SOK  1,923 

53%  47  1.818 

62%  48  476 

52  48%  219 

56  60  851 
59%  54%  729 
67%  60  '>09 

57  63  267 

9,937 


Preferred 

High.  Low,  Sales. 

93%  90  47 

93%  92  30 

92  90  59 

91  90  62 

90  88%      102 

89  83%  125 
82  82  2 
82  81%  24 
88  83  2 
88%  85%      173 

90  85%  87 
94%  89  20c 

919 


Bort.  Co.,  r.  N. 


Common 
High.  Low. 
109       101% 
107%    104% 
106        102% 


106 
112 
lit 
100 
100 


101% 
102 

9414 

95 

9> 


98%   12% 
98%   9( 


102 

lot 


»7 
104 


Sales. 
122 
84 
714 
286 
7H 
2(1 
202 
120 
188 
41* 
7*t 

(91 
4.902 


Preferred 
High.  Law. 
107  91% 


101 
lot 


i*e 

104 


104%  1*1 

112  103 

112%  100 

100  97 


104 
102 
l»t 

lot 
u* 


104 
101 
102 
1*4 
1»7 


••Isa. 

ttt 
4t 
4t 
t« 

1(4 

til 
t 
11 
It 
2t 
11 
44 

ttt 


Canada  Fonndrlss 
A  Forglngs 
Common 
High.  Low.  Sales. 


Oanada  Life 
Prafsrrcd 
High.  Ixm.  Sales. 


Canada  Steamships  Co.,  Ltd. 
Common  Preferred 

High.  Low.  Sales.  High.  Low.  Sales. 

January            ...      60           4G%  1,846  73%  65  1,087 

Februcry                     45%      27%  9,305  71%  66  1,164 

March 32          28  2,013  68  64%  908 

April 29%      18%  4,286  64%  38  6,611 

M.iy     ..     26%      21  1.601  68%  40%  4,228 

June 23           17%  1,010  56%  43%  2,045 

J    ly     ..             ...      20%      18%  820  49  44%  762 

Auifust               ...      22           19  297  63%  49%  1,168 

.September     ....      20%      19%  305  64%  49%  1,129 

Octobtr     19%      18%   •          75  55  49%  1,600 

'November     19          17%  176  64%  62  808 

December    ..     .:      1«%      12%  630  53%  43%  3,726 

Sales 22,263  24,236 

\ 

Canadian    Locomotive 

Common  Preferred 

High.  Low.  Sales.  High.  Low.  Sales. 

January 86           S2  154  86  S3  46 

February    ....      86           84  -5  86  86  58 

March 86          84  120  87  85%  26 

April 78           78  5  84  80  47 

M.iy 77          75  20  81%  80  13 

Juno 81  80  6 

July 82%  82  45 

August 82  80  35 

September     76%      75%  30  79  79  10 

October     ...         77           76  26  79  78  43 

November   ....      75           75  50  82  80  36 

Dixember ....  83  81%  19 

Sales 409  376 


OBNERAL — Continued 

Canadian    Car   &   Foundry 


Canadian    Qsneral    Kltctrlc 


Conlagan    Mines, 
Limited 
($6    per   hare) 
High.   Low.   Sates. 

January 2.20     1.50      4,480 

February  2.16      1.95  620 

March     2.05      1.85       1,660 

April 1.96      1.89  900 

May      1.80      1.65  490 

Juno 

July 

August      

September     

October     ..... 

November 

December .... 

Sales 8,050 


Cons.    Mining    8t 

Smelting   Co. 

126   par 

High.   Low.  Sales. 

21  18  2,173 

20%      IS  886 

19  16%  698 

16%      16  1,090 

16%      16  330 

16%      13%  898 

14  18%  235 

16  14%  496 

16%      16  206 

19%      16  636 

19  18%      1506 

19%      17  1,127 

10.276 


Dominion     Iron 


Common 

Pr 

sferre( 

Conunon 

Preferred 

High. 

Low.  Sal 

es. 

High. 

Low. 

Sales. 

High 

Low.  Sales. 

High 

Low. 

Bales 

70 

64 

80 

105 

94%        770 

90 

71« 

78% 

78% 

60 

101% 

102%        748 

108 

tt 

1(1 

70% 

70 

86 

117 

108%     (.114 

10« 

ttS 

ttt 

66 

66 

36 

112% 

107             8«4 

100 

It 

t( 

69% 

66 

40 

lis 

99%        442 

11« 

9t 

lit 

51 

49% 

15 

113 

106             948 

1«I 

»• 

4( 

53 

48% 

60 

111 

84%        520 

101% 

10« 

tt 

62% 

50 

60 

95 

88%       (c: 

101% 

tt 

tT 

51 

50% 

60 

94% 

92             708 

It 

ttt 

48 

43 

100 

95% 

92%     t,170 

94 

lit 

20 

46 

15 

62 

46 

105 

95 

90         I.4<9 

100 

»4 

111 

21% 

19 

66 

70 

51 

45% 

50 
690 

(( 

9i           1.83< 
16,252 

102% 

IM 

tt 
1.44t 

aBNERAL — Continued 
Canadian   Pacific 

Railway 
High.   Low.  S.Tles. 
141        129%      1,831 
135%    130  1,502 

132        130  1,829 

129  123%   1,598 

130  126%    633 

128  114    1.966 

129  124  771 
130%  126  779 
127%  124  790 
126%  120  1.307 
134%  123%  1,594 
133%  126     

16,081 


Canadian  Salt 


•  City  Dairy 
Common  Preferred 


High. 

Low. 

Sales. 

High. 

Low. 

Sales. 

High. 

Low 

Salsa 

87% 

87% 

5 

60 

(( 

( 

tt 

IS 

11 

89 

89 

4 

10 

to 

It 

88 

87 

20 

66 

«< 

2 

It 

1* 

It 

80 

80 

10 

66 

« 

1 

It 

II 

4 

75 

75 

100 

80 

76 

26 

It 

tt 

15 

80 

76 

S 

11 

t« 

41 

77 

M 

(( 

12 

11 

71 

76 

T« 

75 

14 

14 

t 

78 

77 

II 

It      . 

t( 

It 

75 

75 

20 

t« 

ITH 

111 

100 

It 

Itt 

tt 

91 

«« 

161 

Sit 

t<t 

GENERAL — Continued 


Consumer  Qas 

High.  Low.  Sales 
137        124%      1,672 

140  132     540 
140    136%    766 

141  137     383 
141   137     ^53 

68%  66  638 

67%  66%  260 

75  63  806 

71  68  288 

68%  65  436 

71  68  846 

74  70%  616 
7,402 

OBNERAL— Continued 


Crown  Reserve 

(II  per  share) 

High.  Low.  Salea. 


13  13       1,000 

10%    10     1.266 


Crow's  Nsst 
Pass  Coal  Co. 
High.  Low.  Sales. 
47  45  IK 

(5  (0  1«( 

4T  47  4 

14  (4  1* 


Detroit  0alt*a 

High.  Low.  Bala*. 
19%        **  Tl 


Dome  Mines 

an 

A  Steel 

Domln 

Ion   Stee 

Corpori 

tlon 

(tlO.OO   par) 

Preferred 

Common 

Preferred 

High.    Low.   Sales. 

High. 

Low.  Sales. 

High. 

Low. 

Sales. 

High. 

Low. 

Sales. 

January 

..    14.26    11.76          946 

75 

68%          15 

49 

43 

2,602 

(4% 

«4 

2t 

February    . . 

..    18.76    14.00       6,025 

76 

76                St 

49 

41% 

4,117 

March     .  .     . . 

. .    18.00    17.15           810 

76 

76                32 

49    , 

41% 

6.922 

April 

. .    24.25    18.15       4.625 

68% 

68%            60 
66%            »6 

43% 

37% 

2  653 

May 

. .    22.50   20.26       1.823 

66% 

38% 

31 

3.728 

Juno     .  .     .  . 

..    20.60   17.00       3.446 

31% 

23 

3,269 

July 

..    26.00    19.00       3,446 

11% 

14 

677 

August 

. .    19.80   18.25           845 

38 

26 

80S 

67% 

56% 

SO 

September 

. . .22.75   18.25       1,325 

28% 

1«% 

976 

October     .  . 

. .    20.90   19.50          941 

26% 

24 

466 

ii% 

«i\ 

10 

November 

. .    21.60   19. 7S       1,125 

17 

714 

714 

«t% 

<s% 

30 

December 

..      21.25     19.60        660 

(8% 

62%            27 

17 

t5 

2.174 

to% 

It 

ITO 

Sales    ..     .. 

11,640 

tit 

1.114 

111 

12 

12 

4,000 

5  3  H                                   -•. 

12 

12 

4,000 

45           • 

52%                           -( 

75                                 -2 
71%         11              SSI 

9% 

7% 

300 

47           47 

41 

71         11%           t« 

437 

Dotnlnlon 

1.064 

tt.M* 

wpor 

Ktion 

Tslecraph 

Dolath-anperlor 

High.  Low.  Sales. 

15  II  21 

IS  II  (1 

II  11  tl 

SO  T9  14 

79  Tl  t 

Sl%  tt%  14 

31%  11%  tt 

IT  14  lii 

11%  11%  t 

tl  IT  IIT 

tt  IT  tl 
til 


High.  Low.  Salsa. 

11  II  It^ 

IS  It%  «4I 

1(  II  4Tt 

11%  It  I.IM 

tC  11  tIT 

tt  It  II 

II  U  tt 

II  II  I 

It  II  4( 

11%  11%  14 

KH  ISH  W 

II  im  II 

2.211 


96 


THE      MONETARY      TIMES 


Volume  68. 


TORONTO     STOCK     EXCHANGE— Prices     and     Sale,     in     1921 


January 
Februaj^ 

March 

April    .  .     . 

May 

June    . .     .  . 

July    .  . 

September 

Auitjust 

November 

October    . . 

December 

Sales    .  .     . . 


Dominion 

Cannera 

Illinois   Traction 

Ooiiunon 

Preferred 

Llate 

d    Oct.    13 

Hlgrh 

Low. 

Sales. 

High. 

Low. 

Sales. 

High 

Low.  Sales. 

tSM 

36% 

965 

80 

78 

60 

41 

3014 

•    616 

80% 

80 

42 

300 

300                1 

29 

26 

290 

80 

78% 

30 

340 

320                12 

29 

26 

125 

78 

77 

67 

327 

327                17 

26% 

24% 

203 

77 

77 

40 

24% 

21 

66 

78    ■ 

76% 

63 

22% 

21% 

85 

76% 

76 

20 

300 

300                10 

27% 

24% 

249 

78 

77 

15 

310 

310 

25 

23 

220 

76 

76 

48 

27 

26% 

40     • 

76% 

75 

39 

260 

260                  1 

29 

26% 

100 

77% 

77 

31 

310 

310                  1 

28 

24% 

47 
2,004 

77 

77 

10 
466 

292 

266                19 
63 

Ford  Motor  Co. 

Preferred 
Hiffh.   Low.  Sales. 


70 


Lake  of  the  Woods  Milling  oC. 
Common  Preferred 

High.   Low.  Sales.  High.   Low,  gales 

135%    135%  15 

152        149  35 

148%    148%  20 


136%  135% 

130  130 

134%  134% 

132%  132 

139%  139% 

146%  145% 

143%  142% 


1 

1 
30 

3 
40 

5 
30 

11 
190 


103%      103% 


La  Hose 
Consolidated 
($1  per  share) 
High.   Low.  Sales. 

January 32%     .21  1,686 

February .... 

March 25         .19  6,700 

April 

May .  .  .... 

June 20         .20  1.600 

July 

August 17%     .17%  300 

Seple-mber    .     .  .     .32         .28  300 

October 33         .33  2.000 

November    .     ..     .32%     .32%         300 
December    ....      33  33  1.100 

Sales 13,886 


January 
February 

March    . . 

April 

May 

June     .  . 

July     .  .     . 

August .  . 

Septembtr 

October 

November 

December 

Sales    . .     . 


GENERAL- -Continued 

Mack  ay    Companies 
Common  Preferred 

High.  Low.  Sales.  High.  Low.  Sales. 


Maple    Leaf 
Conunon 
High.  Low.  SaJes. 


Milling 
Preferred 
High.  Low.  Sales. 


Mexican    Light 

and    Power 

Common 
High.  Low.  Sales, 


SO 

78% 

76 

74% 

76% 

76% 

73% 

73% 

78% 

78% 

82% 

82% 


69 

76 

71% 

71 

73% 

71% 

71 

72 

72% 

75% 

76% 

76% 


707 

996 

957 

928 

662 

605 

458 

477 

1,043 

855 

2,035 

1,260 

10,982 


65 

64% 

65% 

64% 

62% 

61% 

62% 

63 

63 

62 

63 

67 


63 

63 

63% 

62% 

61 

60 

60% 

62 

62 

61 

61 

62% 


274 
382 
^19 
205 
159 

;44 

182 
33 
117 
251 
299 
'30 
2,895 


146 
145 
135 
130 


138 
144 
130 
120 


134%  128 


13 

130 

120 

118 

115 

126 

124 


120 

110 

115 

116% 

113 

109 

115 


338 

86 

85 

75 

241 

102 

119 

110 

90 

139 

445 

497 

2,326 


97 

98% 
100 

98% 

96% 

96% 

96 

96 

96 

96% 

97% 
100% 


93 

97% 

98 

96 

95 

95 

95% 

96 

95 

96% 

95 

98 


82 

77 

40 

77 

54 

172 

125 

44 

99 

145 

115 

81 

1,111 


6% 
6 


86 
26 


Oommon 
High.  Low.  Sales. 


76%      76% 


Monarch    Knitting 


Preferred 
High.  Low.  Sale 
80 
80 
80 
80 
78 
78 
75 


QENERAIi— Continued 

National   Steel  Car  Company 

Voting 
Preferred 
High.   Low.  Sales. 


Common 
High.   Low.  Sales 


Trust 
Common 
High.  Low.  Sales. 


15 
26 


77 

76% 
75 
80 


80 

80 

78 

78 

77% 

75 

77 
75 
75 
78 


10 
6 
4 

16 


10 
25 
10 
13 
135 


6% 
5% 


5 
3% 


3% 


4 
6 

5% 
4% 
3% 


427 
305 
225 
177 
26 


70 


26% 


25 
22% 


22 
22 
23 
23 
22% 


366 

160 

60 

26 

25 


1,22 
GENERAL— Continued 


Nipissing 
S5  per  share) 
High.  Low.  Sales, 
9.00       8.60  699 

9.00 
8.45 
5.25 
5.00 
4.80 
4.50 
4.90 
5.10 
5.55 
5.70 
6.60 


9.60 
8,80 
8.60 
5.35 
5,00 
4.95 
6,00 
6,50 
5,95 
7.01 
7.30 


1,026 

1.115 

4,082 

992 

404 

180 

240 

1,010 

730 

670 

900 


12,048 


Nova    Scotia  Steel 
and  Coal 
Common 

High.   Low.  Sales. 

January     42          37  416 

February     ,  ,      , ,      44          40  290 

March 42          37  129 

April 41          40  85 

May 41          37%  108 

June     27%      25%  45 

July 24          24  43 

August .  .  .... 

September .  .  .... 

October .  .  .... 

November   ...      27%     26  110 

December .  .  .... 

Sales 1,226 


Ogilvie    Flour    Mills    Co. 
Common  Preferred 


gh.   Low.  Sa: 


190%    190Vi 


High.   Low.  Sales. 


Ontario  Steel 
Product 
Listed   Dec.   1920 

High.   Low.  Sales. 


Comjnon 
High.  Low.  Sales. 


Pacific  Burt 

Preferred 
High.  Low.  Sales. 


101%    101% 
104%    104 


106        106% 


20 
10 


66 

66 

66% 

63 

37 

48% 

48% 

54% 

55 

44% 


65% 

65 

62% 

52% 

37 

42% 

42% 

49% 

46% 

38 


4,3%      41 


26 

75 

65 

10 

25 

435 

435 

1,504 

1.627 

276 

150 

4,481 


36 
30 
30 
37 
37 
37 
38 


36 
30 
30 
30 
37 
37 
38 


20 

10 
15 
10 
242 
34 
34 
10 


386. 


79 

78 

81 

78° 

76° 

79% 

76 

76 

75 

75 

75 

78 


76 
78 
78 
78 
76 
76 
74 
74 
75 
73 
75 


49 

75 

47 

2 

2 

38 

15 

15 

2 

5 

11 


GENERAL^Continued 


Common 
High.   Low.   Sales. 


Janu.iry 
February     . 
Marcli    .  . 
April    ,  .     ,  , 
May    .  ,     .  , 
June    ,  ,    .  . 
July    . 
August    ,  , 
.^eptcmlier 
October , ,    , 
Nov'(  mber 
Decenibcr 
Sales     ,  . 


95 
100 


lOff 
100 


95 
100 


100 
98% 


4 
40 


6 
26 


74 


January    , . 
February 
March    ,  , 
Ap-11    .  .     . 
Mwy     ,  , 
June 

July    ,  ,     . . 
August .  , 
September 
October,  , 
V  xember 
December 
Sales    .  .     . 


Common 
High.  Low.  Sales. 
87% 
95 
87% 


96 
102 

97 


62 
236 
190 


94 


94 


50 


limited 

Port    Hope   Sanitary 

Po 

rto    Rico 

'referrec 

Common 

Preferred 

Common 

Preferred 

High. 

Low.   Sales, 

High.   Low. 

Salt's 

High.   Low. 

Sales 

High.   Low. 

Sales 

High.   Low.  Sales. 

81% 

78 

55 

40          37 

113               70          64 

255 

78% 

78% 

5 

46          38 

689               78          71 

95 

85 

85 

5 

45          4 

2 

210               76          70 

93 

45          43 

176               81          76 

IOC 

45          44 

89               79          76% 

37 

44%      40 

38               78%      75 

76 

77          77 

76 

86 

86 

5 

35          35 

17               77          77 

25 

84 

84 

12 

35          35 

43 

36          35 

55               76          70 

19 

Bt 

1,430 

775 

GBJNE 

RAI 

.-- C>r 

tinned 

iper 

Quebec 

Railway 

Riordon    P 

ulp    &    Paper 

Co. 

Preferred 

L.    H. 

& 

P. 

Common 

Preferred 

High. 

Low.   &i 

lies. 

High.  L 

ow. 

Sales 

High,   Low. 

Sales 

High.   Low. 

Sales 

H 

igh.   Low.  Sales, 

87% 

87% 

2 

27          2 

2% 

1,48( 

158%    129% 

28 

87% 

87% 

146 

29%      2 

6% 

•2,15 

148        142% 

S( 

87% 

87 

200 

28%      2 
26%      2 
29%      2 
28%      2 
26          2 
28%      2 

6% 

4% 

4 

2% 

3% 

4 

lO 
r.i 
1,05 
83 
8 
64 

126        103% 

108%      21% 

.                27           14% 

18%        7% 

)                13            3% 

4             1% 

26 
2,68- 
2,72 
1,38- 
1,30( 

63( 

83 

82 

10 

26          2 

3% 

28 

3%        2 

111 

87 

S3 

30 

25%      2 
25%      2 

4 
4 

25( 
19 

8             3 

7%        5 

69£ 
58 

ke 

84 

42 
430 

24%      2 

3 

?3t 

8,J8 

6             6 
i 

24( 
10.97 

January  6,  1922. 


THE      MONETARY      TIMES 


97 


TORONTO     STOCK     EXCHANGE— Price,     and     Sales     in     1921 


Rouera,    William  A. 

Common  Ppeferrod 

High.  Low.  S&leH.  High.   Low.  Salea. 

January     66          63               46  87  86  21 

February     ....      64           63                36  87  86  17 

M.LPch 66           63                   8  94  «S  17 

AlTll 66          60                30  »0  87  18 

May 65          60                27  .... 

June 60     60       11  86  83  10 

July 60     60        2  83  76  42 

AUKUst 60           50                   8  76  76  12 

September ....  80  74  68 

October ....  76  76  16 

November ....  76  76  6 

December ....  80  76  34 

Sales     .  .             ...                                      166  260 

Shredded    Wheal 


UUNKIi.^I/ — Cuntiiiuud 

Ruaa«H  Motor  Car 


Common 
High.   Low.  Salea. 


69  Vi     6a% 


Proferrod 

HIrh.  Low.  Sales. 
•  5  46  101 

66  6«  * 


t6 
it 

60 

'56 
63 
61 
CO 
•0 


6t 
60 
60 

60 
60 
60 
60 
50 


It 
It 

20 

"it 

46 

2S 

17 

60 

244 


Cominon 

Ul>h.  Low.  B«lM. 

It         II  It 

It  II  70 

It  II  4« 


Bawr«r-lfa«**7 


6 


I 

IM 


21 

10 


QENBRAL— Continued 


January     130 

February     .  .     . .    128 

March 180 

April 

May 120* 

June 

July 

AUKUBt 

September 

October 

Novemlier 

December           .  .    132 
Sales    


Common 
High.  Low.  Sales. 


130 
125 
129 


15 

100 

20 


6 
166 


Standard 
Chemical 

Com.mon 
Hig-h.   I.i0w.  Sales. 
January  ...      29  2X  30 

February     ....      27  26  26 

Marcii .... 

Apiil .... 

May .... 

June .  .  .... 

July 

August .... 

September .... 

Oc'.ober.  .  ....  .... 

November .  .  .... 

December .  .  .... 

Sales .... 

•  Tretheway 
(11.00    Par) 
Hlg-h.    Low.   Sales. 

January     19%      19  ^i         600 

Fezruarv .  .  .... 

Miirch 16%      16%      1.500 

April 18  11 H      2.100 

M.iy     19  19  600 

June 17  15  6,250 

July .... 

Aucu.st l.l^      IS  v.,  200 

September .... 

October .... 

November .... 

December    ....      11  S\      2,600 

Sales 12.550 

Commerce 

High.  Low.  Sales. 

January     .        ...    198  179%  42S 

February     .  .     . .    190  186  313 

March 190  187  124 

April 187V4  182  242 

May     190  184^4  169 

June 1841,4  183^4  194 

July 186  184  94 

Aucust 187  184  298 

September     .      ..186  184  187 

October..            ..    187U  186%  188 

November     .      ..189  184  343 

December            .  .    189  192^4  386 

Sales 2,965 

Montreal 
High.    Low.   Sales. 

Janii;ir\      212        196  229 

Pel)ru:ii  V     .  .      .  .    210V4    20914  ,    61 

M;r.-.  li 205%    205  11 

April               ,     ...    20914    206'>  72 

Miiv 206        205  6 

June 203V,    203^4  5 

Julv     199%    199%  7 

AUKUal 206%    206%  6 

September          ..    208        206%  10 

October..           ..   210       209%  35 

November     .      ..    209        206<.i  106 

December    .  .     .  .    216        208  61 

Sales 671 

Canada    Landed 
and    National 
Investment 
HiKli.    Low.   Sales. 

.l.nui.irv     l.lOk,    130  37 

I'Vlirunry  ..    135        130  164 

Man  li 134        13i%  S6 

Apil 135        132%  68 

Mny 136%    135  125 

June     67%      66  65 


Preferred 

High.   Low.   Sales. 


Common 
High.  Low. 
88%      80% 


Spanish  River  Paper  and  Pulp 


81% 

78 

74H 

77 

69 

66% 

66 

66 

69% 

69% 

78% 


1 
70 
68 
70 

47% 
47 

47% 
61 

i»% 
68 
66 


4ales. 

736 

2,648 

1,384 

2.122 

873 

3,306 

296 

1,165 

722 

»25 

86 

141 

14,192 


Preferred 
High.  Low.  Sales. 
94%      11%  416 

84 

79 

74 

77% 

60 

tt 

66% 

t<U 

<8% 

7t\ 

70% 


Preferred   1914 
BIrb.  Low.  Sales. 


>0% 

86 

83% 

10% 

78 

62% 

«5% 

«S% 

7«14 

78 

70% 


2(4 
241 
741 
276 
806 
212 
342 
127 
70 
120 
1 


Steel   Convpany 
Coinunon 
High.   Low.   Sales. 


64 

63% 

61 

61 

60 

67 

49% 


59 

61% 

56% 

57 

56 

48 

46 


61%  44% 

68  48 

64%  66% 

64%  60% 

62%  89% 


907 
547 
933 
465 
877 

2,193 
613 
975 

1,686 
797 
647 

1,021 
11,460 


OEINBRAL- (Continued 

of    Canada 

Preferred 

High.   Lorw.  Sales. 

92%      86%         456 

92% 

92 

90 


Tooke  Bros.,  Ltd. 
Common  Preferred 

High.  Low.  Sales.  B4th.  Low.  Sales. 


93 
03 
92 


90%      90 
89%      96 


88% 

90 

90% 


84% 

88 

89 


93%      90 
90%      90 


Tuckett  Toba 
Common 
High.    Low.   Sales 


49 

61% 

45 

45 

46 

40% 

3.') 

40 

41 

38 


42 
48 
46 
46 
42 
39 
35 
36 
3S 
3S 


221 

366 

17 

30 

49 

11 

•■iO 

130 

105 

10 


116 
99 
403 
226 
326 
129 
60 
33 
149 
76 
232 
2,143 
GBNBRAI.— Cont 
ceo  Co. 

Preferred 
High,  Low,  Sales. 
83  82  35 

81  13 

81  36 

80  6 

80  6 


7>  78 


30 


46%      46%  100 


93 


83 
81 
80 
80 


91 


100 

Twin    City 
Com.mon 
High.  Low.  Sales. 
43%  287 

44% 


47 
47 
46%      44 

61%      47 


70  70  40 

70 

Western  Canada 

Flour 
HIvta.  Low.  Sales. 


37%      34 


81 
82 
82 
82 
81 
82% 


80 
82 
82 
82 
82 
SO 


12 

18 

26 

t 

to 


62 
49 
47 
47 
48 
41 
39 


49 

41 

44 

44 

44% 

17 

36 


D 
High. 

204 

202 

200 

197° 

197 

196 

193 

192 

196% 

193 

195 

202 


ominlon 
Low.  Sales. 
191%  139 


199% 

188% 

194° 

192 

191 

185 

190 

191 

192 

192 

196% 


183 
147 

94 
125 
113 
178 

66 
105 
114 
160 

65 
1,469 


High. 

185 

184 

180 

181 

184 

188 

178 


211 
BANKS 

Hamilton 


26%      34 


Low.   Sal-B. 
169% 


180 
179 
179 
179 
177 
170 


179%  176 
172    170 


174 
173 
176 


171 
168 
169 


144 

16 

80 

199 

61 

46 

44 

86 

66 

146 

202 

1,1)98 


Imperial 
High.  Low. 
190    196 
190 
189 
191 
185 
184 
181 
18t  ' 
181 
182 
ISO 
182 


186 

186 

183% 

184 

I7« 

179 

liO 

180 

179 

171% 

17S% 


Nova  Scotia 


High.  Low. 

266  249 

269%  259% 

261  259 

256%  266° 

255  253% 

264%  250 


261 

262 
251%  247 
251%  248 
263 
252 


249% 

60% 


252% 
60 


Sales. 
86 
14 
86 

139 
42 
41 
16 
32 
73 
62 
22 
46 

58S 


BANKS — Continued 
Royal 

Sales. 

272 


High.   Low, 
204%    194 


203 

202% 

202 

206 

203 

200 

201 

198% 

201 

204% 

201 


Canada   Perma- 
nent Mortgage 

Corporation 
High.  I.,ow.  Sales. 


T.4 

227 

128 

128 

149 

139 

86 

110 

187 

S27 

t'36 

2.042 

LOAJ«  AND  TRUST 


200 

200 

200 

201% 

198 

198 

197 

194% 

197 

198% 

199 


Standard 
HIrh.  I.rt>w. 
30t  198 
202%  200 
202  201 
20l%*200 
202        200 

204  101 
208   200% 

205  201 
204%  203 
204%  201% 
204   201% 
20«    304 


667 
i80 

1,901 
213 
135 
65 
61 
164 
181 
146 
174 

4.44t 


Sales. 
203 
lt8 
168 
164 
SOI 
118 
112 
409 
9« 
191 
330 
443 
2,312 


Sales. 

686 

404 

160 

179 

216 

121 

74 

•  6 

116 

13« 

38 

263 

2.ST5 


II 
71 


Jfsrcbants 

High.    Low.   Sales. 


181  16»% 

177%  177 

180  ITt 

1T9%  170 

17<  110 

170  170 
1T«  170 
ITl  1«« 
l«l  Kt 
1«»  101 
I«2%  161 

171  Itl 


84 
24 
(2 
27 

111 
It 
tl 
t« 
40 
<l 
76 
*7 

It* 


Toronto 
High.  Low.  Salsa. 


192 
111 
111 
lit 
lit 
178 
112 
ISt 
181 
190 
lit 
110 


181 

111 

ISt 

179 

177 

177% 

ITI 

lll« 

111 

111 

117% 

111 


164 

t 

14 

12 

111 
IS 
14 
It 
4* 

It* 

III 

to 

ITI 


173 
190 
ISO 
176% 
177 
17% 


164 
180 
176 
173 
174 
17% 


1,017 
336 
2.683 
1,934 
1.147 
1.179 


C«nlral  Canada   Loan  and  Savings 
10%   paid 
High.   Low.  Sales.  High.   Low.  Sales. 


Coloalai    Inves'. 

ment  and  Loan 
High.  lrf>w.  Sales. 
71         77  101 

Tl  Tt  Itl 

Tl         TIM         III 
TIH      TSH  4«3 


Pretsrrad 

High.  Low.  Salsa. 


14 

tl 

tl 

«• 

IT 

It 

14 

I* 


21% 
10 


High. 


«• 

41 

to 

41* 

10 

10 

10% 

II 


27 
10 


IIT 

1*1 

l«t 

I 

lit 

II 

40 

to 


12 

It 

111 


Toronto  Ballwar 


High. 
<•% 
74 
«•% 

72% 
72 

to 

Tt 
Tl% 

T4% 
Tl% 
«•% 

«T% 


Low. 

(0 

«*% 

**% 

«( 

«l 

TO 

«l% 

«l% 

*l% 

11% 

«t% 

*«% 


Winnipeg 

Blectrle 

High.  Low. 

41%     2( 


41 

46 

41% 

41 

40 

II 

16 

It 

11% 


11% 

40 

l»% 

t* 

14% 

11% 
I* 

20% 
17 


11%      14% 
U  14 


Balsa. 
t.llO 
t.K* 

1  Oil 
2.121 

1,441 
1.212 
1.112 
2,02* 

l.iio 

1.417 

lit 

l.lll 

It.lIT 


Sales. 

«82 

l.tll 

127 

102 

Tn 
itt 

4« 
42« 

I.ITT 
Tt4 
Mt 
•tt 

1.241 


Ifolsons 
High.    Low.   Sales 
1««%    1«S% 


1T4 

ir- 


1T4 


176  17« 
110  ITI 
ITT        171 


High. 

1*0 

11*% 

tlT 

lt« 

161 

1SI% 

!<>% 

160 

141% 

141 

14t 

I4« 


I* 

II 

TO 

IIT 


I.OW.  SalM. 


i«T 
lt« 

114 

Itt 

III 

14T% 

141 

141 

144% 

141 

141% 

140% 


111 

lOT 
tl 

to 

tt 
2tl 

4« 
It 
14 

44 

11 

441 

I.4tl 


minion     SaTlna* 
and   InisstmsMt 
High.  Low.  Balsa. 


TO 

TO 


TO 

ii 


11 

a 


98 


THE      MONETARY.    TIMES 


Volume  68. 


TORONTO     STOCK     EXCHANGE— Prices     and     Sales     in     1921 


July 

August  .  . 
September 
October.  .  . 
Navembe^- 
December 
Sales    .  .     . 


66 
66 
70 
70 
71 
70 


65 

63% 

64 

68 

70 

70 


9 
149 
128 
143 
163 
52 
1,189 


17% 

ITA 

17 

17% 

17 

17% 


I6V4 
16V4 
16% 
16% 

17 


474 

306 

1,134 

964 

1  245 

1,676 

14,094 


Hamilton   Provident   and    Loan 


January    . .     . 

.    140 

140 

February    . . 

.    140 

140 

March    .  .    . . 

..    140 

140 

April 

.  .    140 

140 

May 

June 

.  .    140 

140 

July 

August     .  ■     ;  • 

September    . 

October..     . 

November     . 

December    .  . 

Sales 

High.  Low.  Sales. 
19 
40 


Natlona.1  Trust 

High.   Low.  Sales. 

January .  .  .... 

February .... 

March 196       196  40 

April 260        200  2 

May .... 

June .  .  .... 

July 

August          ..    ..    197        197  16 

September    .     .  .    195        195  5 

October 196       194  15 

November     .     .  .    195        190  51 

December    ..     ..    190        190  24 

Sales 183 


January    . 
February    . 
March     .  . 
Ap-il     . . 
May 
Juno 

July  . .  .  . 
August  .  . 
Sept.  . .  . 
October  . 
November 
December 
Sales    .  .    . 


January    . 
P&bruary 
March    . . 
April    . .     . 
May 
June 

July    ..     . 
August    . 
Sept. 

Oct.  .  .  . 
Nov.  .  .  . 
Dec.  . .  . 
Sales 


Canada  Bread 

High.  Low.  Sales 

84 

86 

83 

S3 

83% 
82 
83 

83% 
87 

86% 
87% 
89 


84 

86 

85% 

85 

84 

83 

84 

84 

87 

87 

90% 

90 


1,000 
6.800 
8,000 

16,200 
8,000 
3,500 
1,300 
2,400 
8,000 
4.600 
4,000 
3,600 

66,400 


(1923) 
High.   Low, 
99         96% 
99%     97% 
98%     96% 

.    98%    se% 

98.75  97.60 
98.70  97.60 
98.90  97.60 
98.30  97.20 
98.20  97.80 
98.20  97.80 
99.15  98.35 
i-9.75  98.60 
4 


Sales. 

{604,200 

247,060 

469.600 

217,300 

365,600 

562.200 

210,000 

339,600 

346,150 

345,160 

497,360 

172,400 

375,400 


20    per    cent. 
High.   Low. 
110       110 
110       110 


110 
110 


110 
110 


76% 
76% 


76% 
76% 


High 
86% 


89 
87 


Canadian 
Locomo-tive 
Low.  Sales. 
86%    $18,500 
9,000 


89 
87 


87 
85 


87 
85 


1,000 
2,500 


9,000 
500 


1,000 
42,600 


(1924) 
High.  Low.   Sales. 
9414    $664,150 
96%  1,248,400 


96 
96 


97% 
96% 
96% 
96% 

96.90  96.00 

97.00  96.00 

98.16  96.60 

97.30  96.00 

96.40  95.90 

97.25  96.40 

98.60  97.40 
98.40   98.00 


498.700 
179,850 
277,700 
226,400 
70,500 
193.660 
130,360 
183,760 
719,250 
162,660 


Dominion     Cannera 

High.  Low.  Sales. 

January             ...      89  88  $7,600 

February    ....      90  90  2,000 

March .... 

AprU 90  89%  3,000 

May . .  .... 

June . .  .... 

July 87  87  3.000 

August 87%  87  3,600 

September .  .  .... 

October . .  .... 

November .... 

December    ....      90  90  600 

Sales 19,600 

Quel)ec  Railway, 
Light  and  Power 
High.  Low.  Sales. 

January  ...      62%      62%  $10,000 

February .... 

March .... 

April 

May 63%      63%      1,000 

June 63         63  3,000 

July 

August   . .  . .      . .  . .  .... 

Septemljer . .  .... 

October 63  62%      9,000 

November . .  .... 

December . .  .... 

Sales 23,000 


7  5  174 

7  7  100 

7  6%  .       130 


LOAN    AND    TRUST — Continued 


paid 

Sales. 

14 

35 


12 
2 


Huron    and   Erie   Mortgage   Corp. 

20    per    cent,    paid 


High.  Low.  Saleo. 


High.  Low.  Sales. 


110        110 
109%    109% 


10 

6 

66 


7%         5 

68 

1,746 

57 
London    and    Cana- 

Landed   Banicing 

dian  Loan  and 

and    Loan 

Agency 

High.   Low. 

Sales. 

High.  Low.  Sales. 

137        137 

5 

115       116               46 
120        118                83 

137        137 

3 

116        115                43 

137        137 

30 

116%    116              195 

119        119                17 

69          65              499 

69%      69%            50 

Ontario    Loan    and 
Debenture 
High.  Low.  Sales. 


LOAN    AND    TRUST— Continued 


Real  Estate 
High.  Low. 


92 
92 


Loan 
Sales. 


Toronto    General 
Trusts 
High.  Low. 
ISO        180 


192 
196 
195 


60 
40 


200 

200 

196 

198%    195 

200        198 

196 

198 

199 


196 
195 
197% 


198%    198 

200  198% 

201  201 


Sales. 

19 
75 
28 
20 
16 
9 
8 
26 
36 
116 

143 
36 

630 


58 


Toronto     Mortgage 
High.  Low.  Sales. 
132%    132  20 


132  132 

132  132 

133  133 

67%   62% 


Union   Trust 
High.  Low.  Sales. 
100  90  .  45 

106  97  125 


20 
35 
14 
64 


100 


90 


100 


68%      68%  20 

67%      67%  1 

73  73  29 

213 


S4 

Sl% 
82% 
85 


80 

85 

84 

8H4 

60 

83 


15 


10 
165 
610 
996 


BONDS 
(1926) 


High. 

94^4 

94% 

96 

95% 

95.00 

96.10 

96.00 

94.96 

95.06 

95.26 

96.25 

96.66 


Low. 

92 

93% 

93% 

94% 

94.60 

94.65 

94.00 

93.00 

94.60 

94.76 

96.10 

96.46 


Sal  s. 

$50,  00 
43.  00 
66,  50 
37,  00 

107,  00 
88.  50 
58,  00 

18,  00 
18  00 
61,100 

180,  00 

19,  00 
738,  00 


High. 
94 
96% 
93% 
93% 
93.25 
93.10 
93.26 
92.90 
92.70 
92.60 
96.26 
96.60 


Dominion 
(1931) 
Low.    Sales. 

$76,800 


90% 

93 

92% 

92% 

93.00 

92.80 

92.00 

92.00 

92.00 

92.00 

92.20 

96.00 


37,100 

64,600 

44,800 

65,200 

57  100 

61,200 

73,800 

64,600 

108,300 

120,200 

50.900 

813,600 


Canada  War 
(1937) 
High.    Low. 
98%     94%      $ 
98%     97 
98%     97% 
97%     96 
97.66   96.00 
97.60   96.80 
97.10    96.50 
96.80    96.40 
97.80   96.40 
97.80   97.25 
102.35   97.66 
102.60  100.00 
1 


Loan 

Sales. 

226,400 

146  000 

323,200 

185,000 

173,900 

186,400 

78  400 

69,100 

92,100 

81,900 

188,800 

123,500 

,872,700 


(1922) 
High.     Low. 
99%     97       $1 
99%     98 
98%     97% 
98%     98 
99.60   98.15 
99.60   98.30 
99.40   98.70 
99.20   98.00 
99.20   98.75 
99.20   98.76 
99.65   98.60 
-.99.20   99.00' 


Sales. 

,131,100 
365,200 
341,000 
427,950 
698,650 
613.450 
276.700 
209,660 
287,960 
287,960 
632.460 
381,900 

,633,960 


BONDS — Continued 
Dominion    of    (Canada   Victory   War   Loan 


High 

99% 


(1927) 
Low.  Pal  s 
96%    $161.  60 


97 
97 
97 


97% 
98% 

98.46  97.60 

98.40  96.50 

98.10  96.60 

98.26  97.80 

98.10  97.15 

97.50  97.00 

100.10  97.00 

100.25  99.25 


167,  ^0 

273.  00 

134  460 

115i  60 

83    50 

76,'  00 

62,  50 

23    50 

00 

60 

00 

COO 


21, 

69, 

124, 

1,313 


(1933 

High.    Low.    Sales. 

99         95%  $1,992,900 

99         98  642.200 

98%     97%     1,095,160 

98         96%        708,350 

97.90   96.75   1.350,950 

97.60   96.10       970,200 

98.00   96.80       453,900 

98.00   96.60      ,582,960 

97,70  97.20       425,400 

97.65   97.25       567  860 

101.76   97.46    2,869,950 

101.26  100.00  .,002,760 

2,642,550 


High 
96% 
96% 
95% 
94% 
95.10 
96.16 
94.90 
94.86 
94.60 
94.70 
99.45 
98.70 


(1934) 
Low.  Sales. 
92%  $3,098,650 
95  2,826,300 
91%  1.292,850 
93%  1,127,300 
94.60  1,174,700 
92.90       935  550 


94.10 
94.45 
94.30 
94.40 


448,160 

499,050 
587,100 
927.300 


94.65   3,212,850 

97.60    1.727.760 

17,317,550 


(1937) 
High.     Low 
100%     97 
99%     98 
99%     99% 
99%     98% 
99.45   98.76 
99.60   98.26 
99.30   98.50 
99.35   98.60 
99.20   98.50 
99.10   98.75 
103.80   98.80 
103.45  102.00 


Sales. 
$976,650 
211,700 
710.260 
330,550 
872.050 
516,650 
337.500 
241,350 
214,500 
270,000 
813,200 
431,360 
,924,650 


Dominion   Iron 
High.  Low.  Sales. 
76%      76%    $7,000 


81  81  1,000 

78%  78%  3,000 

78%  77  6,000 

82%  82%  1,000 

82%  82%  1,606 


BONDS — Con'tlnued 

Electrical 
Development                      Ogilvie    Flour 
High.  Low.  Sales.              High.   Low.  Sales. 
92  92       $1,000  


Penmans 

High.   Low.  Sales. 


Porto  Rico 
High.   Low.  Sales. 


93  92%     4.500 

93  93  3,000 


96  96  1,000 


86 
87 


1,600 
1.500 


72 
73 


87%      86%      1,500 
87  87  500 


70 
73 


70 


9,500 
1,000 


•• 

94 

93       16,000 

90 

89 

90 
88 

1,000 
1,100 

72% 

72% 

500 

19,000 

24,000 

1,000 

7,100 

12,500 

BONDS — Continued 

Rio 

ae  Janeiro   Tram 

,   Light   &   Power 

$100 

Sao   Paulo 

Tramway 

Steel  (30 

.  of  Canada 

Sterli 

ng    Coal 

Eligh 

Low.  Sales. 

High 

Low.     ales. 

High. 

Low.  Sales. 

High. 

Low. 

Sales. 

High. 

Low. 

Sales. 

78 

76      $26,600 

68 

62      $13,700 

75 

70 

$136,000 

96 

91 

$4,000 

79 

76%    19,500 

69 

67       10  200 

82     ^ 

76 

100,000 

95 

96 

2,000 

85 

86 

$200 

79 

78        16,600 

69% 

66%     8,700 

80% 

78 

37,000 

94% 

93 

10,500 

78 

78          6,000 

65 

65          1,000 

80 

77 

13,500 

94 

93 

20,200 

78 

77%    18.000 

65 

63             800 

78 

78 

1,000 

93% 

93% 

500 

76 

75          1,000 

60 

60             300 

78% 

76 

20,000 

94 

92 

2,700 

73% 

73%    16,000      - 

65 

62          1,300 

76% 
72 

75 
72 

7,500 
5,500 

93% 
93 

92 
92 

1,000 
7.000 

76% 

73          3,600 

63 

63             800 

73 

73 

6,000 

92% 

91 

8,000 

76 

76              500 

64 

63          2,800 

73 

73 

1,600 

94 

92 

3,400 

79% 

77%    41.600 

69 

66          9.400 

78% 

78 

5,000 

96 

96 

1.000 

84% 

74%    66,000 

70 

70             400 

81 

79%    20,000 

98 

97% 

5.100 

85 

85 

1.566 

202,000 

49.400 

352,000 

66,200 

1.700 

January  6,   1922. 


THE      MONETARY      TIMES 


99 


Large  Volume  of  New  Financing  in  1921 

Total  Bond  Sales  Over  $400,000,000 — Lew  Than  Half  Sold 
in  United  States,  and  Small  Amount  in  United  King- 
dom— Market  Weakened,  But  Closing  Months  Were  Stronger 


LAST  year's  bond  market  was  characterized  by  many  sur- 
prises, in  which  the  calculations  of  bankers,  bond  deal- 
ers, provinces,  municipalities  and  others,  were  badly  upset. 
At  the  close  of  1920,  and  the  beginning  of  1921,  the  market 
gave  good  promise  of  a  big  rise,  an  dall  those  who  were 
familiar  with  the  various  economic  phrases  of  the  situation, 
were  profuse  in  their  predictions  as  to  the  future.  But  these 
prophecies  were  not  fulfilled  until  certain  unexpected  factors 
had  been  met  and  overcome,  a  process  which  lasted  through- 
out almost  the  entire  year. 

One  of  the  most  significant  factors  which  pointed  to  a 
rising  market,  was  the  trend  of  commodity  prices.  History 
points  that  every  great  rise  in  commodity  prices  has  been 
associated  with  a  decline  in  the  price  of  investment  bonds, 
with  a  corresponding  increase  in  their  yields.  Similarly 
every  pronounced  decline  in  commodity  prices  has  been  re- 
flected in  advancing  bond  prices.  The  reason  for  this  is 
clear,  namely,  that  the  bond  has  a  fixed  face  value  in  dollars 
and  cents,  both  principal  and  interest,  and  as  the  value  of 
the  dollar  fluctuates  according  to  the  amount  of  commodities 
which  it  can  buy,  so  does  the  bond. 

Thus,  the  commencement  of  the  downward  trend  of  com- 
modity prices  made  itself  felt  in  the  market,  and  with  pros- 
pects of  a  continued  and  rapid  fall,  anticipations  were  for 
a  corresponding  movement  on  the  part  of  bond  values. 
Furthermore  there  was  a  lessening  demand  for  funds  for 
general  business,  which  pointed  to  a  larger  amount  of 
money  for  investment  in  securities. 

Of  course,  all  this  had  a  profound  psychological  effect. 
Previously,  investors  were  apprehensive  and  Inclined  to  be 
depressed,  but  with  the  first  signs  of  improvement,  the 
feeling,  disappeared  and  confidence  became  predominant. 
Bond  dealers  contributed  further  to  the  situation  by  con- 
stantly showing  "bargains  which  would  not  last  long," 
pointing  to  rising  prices  as  evidence.  There  was  no  reason 
to  believe  they  were  wrong,  and  naturally,  investors 
hastened  to  take  advantage  of  the  low  prices  which  promised 
to  soon  become  high. 

But  this  movement  was  destined  to  be  halted  and  to 
suffer  a  prolonged  set-back,  whicli  resulted  in  loss  and  in- 
convenience to  borrowers,  intermediates  and  lenders  alike. 
Those  provinces  and  municipalities  which  were  waiting  for 
the  opportunity  to  place  their  bonds  at  low  rates,  were 
largely  affected. 

Factors  in  tlu-  Decline  , 

There  were  at  least  two  factors  which  were  responsible 
for  the  reaction.  In  the  first  place,  over-confidence  and 
extravagance  became  over-ruling.  The  market  was  flooded 
with  securities,  and  it  was  not  long  before  a  severe  attack 
of  indigestion  set  in. 

Secondly,  there  was  not  the  amount  of  funds  for  invest- 
ment purposes  as  at  first  anticipated.  The  bank  statement 
had  been  emphasi:?ing  the  approach  of  the  era  of  easy  money, 
as  evidenced  by  the  good  liquid  condition  of  bank  assets. 
But  this  soon  disappeared,  for  while  the  demand  for  funds 
by  industry  was  greatly  reduced,  the  current  borrowings 
of  the  Dominion  government  and  municipalities  were  exces- 
sive, as  shown  in  detail  elsewhere  in  this  issue. 

Naturally,  these  influences  brought  a  reaction  In  the 
psychological  effect.  Provinces  and  municipalities  were  in 
a  good  many  cases  compelled  to  come  into  the  market,  and 
with  the  continuance  of  a  substantial  volume  of  new  secur- 
ities, investors  again  in  an  apprehensive  mood,  and  money 
by  no  means  plentiful,  prices  slumped  miserably. 

Turn  In  th«>  Aiitiuun 

Throughout  the  summer,  the  market  was  quite  weak, 
but  with  the  autumn,  once  more  a  change  was  introduced 


into  the.  situation.  This  was  a  real  movement,  and  carried 
prices  well  above  the  previous  beat  levels.  Victory  Iwiids 
leading  the  way. 

Perhaps,  the  biggest  Influence  wag  the  receptivenesa  of 
the  American  market.  The  volume  of  new  issoes  bronght 
out  In  September,  October  and  November  was  enormous,  and 
could  have  never  been  absorbed  at  home  without  seriously 
affecting  the  market  here.  With  the  aid  of  our  American 
neighbors,  however,  prices  soared. 

The  latter  part  of  the  year,  when  dealers  were  having 
a  hard  time  in  securing  sutficient  bonds  to  meet  the  demand 
of  their  customers,  particularly  long-term  securities,  pro- 
vided a  contrast  to  the  narlv  st^ason,  when  almost  everyone 
was  oversupplled. 

December  was  main.-u  i.y  imiiwi-  reactions  after  the  flrst 
big  burst  of  enthusiastic  uprising,  but  the  trend  was  unmia- 
takable.  The  following  figures  of  Victory  Loan  prices  will 
show  to  a  certain  degree  the  movement  of  bond  prices 
throughout  the  year: 

Nov.,  1920.   March,  1921        June.         Dec.  14 
.1922    .  .  .  .' 98  98  H  98.70  99.20 

1923    98  98  97.80  98.60 

1927     97  97%  97.4.'-.  99. 7S 

1933     96V4  98%  97.00  100.50 

1937    98  98%  99.00  103.05 

1924    97  96?i  96.50  98.00 

1934    93  95%  94.25  98.00 

Kestriction  Removed 

An  event  of  the  year  although  (t  did  not  have  very  mocb 
effect  upon  the  market,  was  the  removal  of  the  securities 
embargo.  Following  closely  upon  the  release  of  Victory 
bond  price  control  by  the  government,  this  marked  the  com- 
plete freedom  of  the  market. 

There  never  really  was  an  embargo,  but  only  certain 
action  taken  to  point  to  those  Interested  in  this  particular 
business  the  adverse  effect  upon  our  exchange  of  a  large 
amount  of  securities  being  brought  into  the  country.  It  was 
something  of  a  relief,  however,  when  it  was  Intimated  that 
the  government  has  stopped  trying  to  artifically  support 
the  market,  and  that  henceforth  prices  could  follow  the 
course  which  was  economically  correct. 

The  "embargo"  was  meant  chiefly  to  prevent  the  inflow 
of  British  securities,  or  rather  British-held  Canadian  secur- 
ities, which  were  finding  their  way  back  here.  But  during 
1921,  a  new  movement  took  place,  and  that  was  the  trading 
In  foreign  securities.  German  and  French  bonds  were  Intro- 
duced here,  the  chief  attraction  being  the  large  proflt  which 
might  possibly  be  made  when  exchange  righted  Itself 

The  most  Interesting  and  outstanding  event  in  thi^  r<r- 
gard  was  the  offering  of  $6,000,000  6  per  cent..  City  of 
Paris  bonds,  to  yield  6^  per  cent.,  being  part  of  an  author- 
ized issue  of  $20,000,000  to  be  placed  in  Canada.  Quebec 
bankers  and  investment  houses  took  charge  of  the  issue,  and 
no  doubt,  the  bulk  of  the  amount  was  taken  up  In  that 
French-Canadian  province.  It  might  be  said  here,  that  the 
money  secured  on  this  Issue  would  not  go  out  of  the  country, 
for  It  was  meant  expressly  for  the  purpose  of  purchasing 
food-stuffs,  etc..  In  Canada. 

Other  trading  in  foreign  securities  was  not  on  a  suffl- 
ciently  large  enough  scale  to  be  of  much  influence  to  Ike 
market,  although  many  brokers  took  up  the  business. 

Iixp<Yienc(«  At>road 
Of  necessity,  Canada  had  to  seek  assistance  from  sbroad 
In  her  monetary  requirements,  but  on  the  ^-'--■-     '      -- 
less  dependent  upon  foreign  help  than  in  thi 
In  1920,  of  the  total  bond  sales  of  about  )3S6.<><m<.<iiiii,  more 
than  two  thirds  were  sold  in  the  United  States.     Last  year. 


100 


THE      MONETARY      TIMES 


Volume  68. 


of  the  total  bond  sales  of  more  than  $400,000,000,  consid- 
erably less  than  half  were  sold  in  the  United  States,  while  a 
small  amount  was  disposed  of  in  the  United  Kingdom. 

Exchange  rates  prevented  the  issue  of  Canadian  public 
loans  in  Great  Britain  to  any  large  degree,  although  bankers 
and  bond  dealers  are  looking  to  the  opening  of  that  market 
in  the  near  future.  In  recent  months  exchange  has  made 
a  big  stride  back  to  normal.  For  example,  in  January,  1921, 
sterling  was  quoted  at  $4.29  here,  while  on  December  14 
last  the  quotation  was  $4.55. 

In  the  early  part  of  the  year,  the  volume  of  securities 
sold  in  the  United  States  was  not  large,  but  as  the  year 
progressed,  and  interest  rates  continued  high,  Canadian 
borrowers  turned  to  the  southern  market,  where  good  rates 
could  be  secured,  in  view  of  the  prevailing  rates  of  exchange. 

But  those  provinces  and  municipalities,  which  had  bor- 
rowed largely  there  in  1920,  were  rather  hesitant  in  making 
further  large  floations,  for  exchange  rates  continued  high, 
and  the  prospects  of  repaying  interest  and  principle  looked 
like  a  costly  undertaking,  in  some  cases  more  than  off- 
setting the  immediate  benefits. 

However,  in  the  autumn  the  rate  of  exchange  fell  con- 
siderably. This  may  be  illustrated  by  the  following  figures, 
which  show  the  rate  of  premium  on  New  York  funds:  Jan. 
21,  14  per  cent.;  March  31,  12%  per  cent.;  June  28,  13iJ 
per  cent.;  December  14,  Sfg  per  cent.  On  December  15, 
1920,  the  Canadian  dollar  was  worth  85.2  cents  in  New 
York.  Last  December  15,  it  was  worth  sliiihtly  over  92 
\cents.  This  fact  of  exchange  was  no  doubt  a  stimulant  to 
borrowing  in  New  York  last  fall. 

Domestic  Loan.s 

In  1920,  when  interest  rates  seemed  so  exorbitant,  mun- 
icipalities and  provinces  took  it  into  their  hands  to  do  their 
own  financing,  and  as  noted  in  the  last  Annual,  a  consider- 
able amount  of  local  selling  was  accomplished. 

During  1921,  very  little  of  this  kind  of  business  was 
done,  notwithstanding  the  fact  that  for  a  good  part  of  the 
year  interest  rates  were  at  times  rather  prohibitive.  The 
province  of  Alberta  and  western  municipalities  were  the 
only  significant  events  in  this  connection. 

.  Western  municipalities  were  in  a  good  many  cases  prac- 
tically compelled  to  make  domestic  loans,  for  there  was 
virtually  no  market  in  the  east,  particularly  for  the  smaller 
and  less  stable  towns  and  villages.  This  was  the  outcome 
of  several  defaults,  more  especially  in  Saskatchewan,  which 
naturally  stirred  adverse  sentiment.  The  majority  of  school 
bonds  and  of  securities  of  small  towns  and  villages  in 
.Saskatchewan,  were  sold  locally. 

Irrigation  Bonds 
A  new  kind  of  bond  made  its  advent  in  the  Canadian 


market  last  year,  namely,  irrigation,  something  like  $4,000,- 
000  of  these  securities  being  sold,  the  cost  to  the  borrower 
being  about  6.4  8  per  cent.  When  these  bonds  were  first 
offered  by  the  Lethbridge  Northern  Irrigation  District,  no 
response  was  made  by  investment  houses,  either  here  or 
across  the  line,  in  spite  of  the  fact  that  the  Alberta  govern- 
ment had  given  a  two-year  interest  guarantee.  The  senti- 
ment towards  irrigation  bonds  in  the  United  States  is  by 
no  means  favorable,  for  there  have  been  several  defaults, 
and  this  was  not  doubt,  the  chief  influence  which  affect  this 
new  offering. 

When  it  was  seen  that  the  two-year  interest  guarantee 
did  not  have  very  much  effect,  the  provincial  government 
finally  made  a  full  guarantee,  an  act  of  legislature  having 
been  passed  which  also  provided  for  a  full  guarantee  of  all 
irrigation  and  drainage  bonds  in  the  province,  provided  they 
v-fere  issued  by  a  responsible  and  well-organized  district. 

With  the  full  guarantee,  it  did  not  take  long  to  dispose 
of  the  Lethbridge  Northern  Issue,  and  not  only  that,  but  the 
interest  rate  which  was  formerly  set  at  7  per  cent.,  was 
reduced  to  6  per  cent. 

Prospects  for  the  New  Year 

The  prospects  for  the  New  Year  are  a  good  and  busy 
market.  The  provinces  have  a  considerable  amount  of 
financing  to  do,  particularly  Ontario  and  Manitoba.  It  is 
reported  on  good  authority  that  it  will  require  ten  million 
dollars  to  finance  Manitoba  farmers  during  1922,  as  not 
more  than  10  per  cent.,  of  the  rural  community  received 
sufficient  returns  from  their  grain  last  year  to  pay  for 
threshing,  and  freight  charges  on  grain  shipments.  Ontario 
has  several  reunding  operations  to  make,  as  have  other  of 
the  provinces.     These  are  just  a  few  instances. 

In  addition  the  Dominion  government  will  have  to  make 
a  loan,  of  perhaps  two  or  three  hundred  millions,  for  there 
is  an  issue  of  Victory  bonds  falling  due.  which  will  harve  to 
be  refunded.  .  .  . 

Corporation  and  Railroad  Bonds 

There  was  a  big  volume  of  corporation  and  railway 
securities.  All  of  the  railroad  bonds  were  sold  in  the  United 
States  with  the  exception  of  a  small  block  of  Canadian 
Pacific  Railway  debenture  stock  which  was  sold  in  Great 
Britain. 

The  bulk  of  the  Corporation  bonds  were  sold  in  Canada 
while  two  small  blocks  were  also  sold  in  the  United  King- 
dom. The  total  of  railway  and  corporation  bonds  was  con- 
siderably in  excess  of  the  figure  for  1920. 

On  another  page  of  this  issue  will  be  found  details  and 
summary  of  last  years'  bond  sales,  of  all  kinds  and  in  all 
markets. 


PRINCIPAL  CANADIAN  BOND  SALES  IN  1921 


Amount 
of  Issue 


Rate 


Term 


PROVINCES 


January 

Ontario     $10,000,000 

Saskatchewan    3,000,000 

Alberta 2,000,000 

Manitoba   2,000,000 

March 

British    Columbia    2,000,000 

Nova  Scotia    1,500,000 

Manitoba  (farm  ins.)    1,000,000 

April 

British   Columbia  3,000,000 

Alberta     2,000,000 

Ontario     1,340,000 

May 

Ontario    15,000,000 

Manitoba     2,680,000 

Alberta   (irrigation)    2,400,000 

Manitoba     2,000,000 

June 

Ontario    (Hydro)     3,300,000 

British  Columbia   3,000,000 

New    Brunswick     1,502,000 

Quebec      1,000,000 

Alberta     200,000 

July 

British  Columbia   4,000,000 

Alberta    (irrigation)     2,000,000 

Alberta    2,500,000 

AngrUBt 

Saskatchewan    3,000,000         6 


4% 

6 
6 


6 

6 

6 

6% 

6 

6 
6 
6 


20  years 
15  years 
15  years 
10  years 

5  years 
5  years 
5  years 

5  years 
15  years 
40  years 

15  years 
20  years 
30  years 
10  years 

20  years 
20  years 
15  years 
15  years 
15  years 

5  years 
30  years 
serials 

6  years 


Price 
Paid 


96.787 
97.637 
96.21 
101.11 

103.77 

102.987 

100.566 

100.01 

96.42 

*76.89 

97.94 
96.55 
93.71 
99.29 

97.17 
93.11 
98.70 
95.77 
96.42 


93.71 
100.899 


Interest 
Basis 


6.28 
6.23 
6.39 
5.85 

5.15 
5.30 
4.88 

6.00 
6.37 
6.05 

6.21 
6.31 

H  .  4S 

6.09 

6.25 
6.63 
6.17 
5.94 
6.37 


Purchaser 


Sold  in  U.S. 


6.48 
5.82 


A.  Jarvis  &  Co.   and  Syndicate 

Dominion  Securities  Corp.'  and  Syndicate 

Wood,  Gundv  &  Co.  and  Syndicate 

W.  A.  Mackenzie  &  Co.  and  R.  A.  Daly $2,000,000 


Dominion  Securities  Corporation. 
National  City  Co.  and  Syndicate.. 
National   City    Co 


British- American  Bond  Corporation. 
Dominion  Securities  Corporation.... 
Wood,  Gundy  &  Co.  and  A.  E.  Ames. 

Wood,  Gundy  &  Co.  and  Syndicate.. 

A.  E.  Ames  &  Co.  and  Syndicate 

AVo<ul.  tJuntiy  and  Dominion  Sec.  Corp... 
Wood,  Gundy  &  Co 


A.  E.  Ames  &  Co.  and  Wood,  Gundy. 

Wood,  Gundy  &  Co 

Harris,  Forbes  &  Co.,  Inc. 

Rene-T.  Leclerc 

Dominion  Securities  Corporation.... 


Miller  &  Co.  and   Syndicate 

Wood,  Gundy  and  Dominion  Sec.  Corp. 
Wood,  Gundy  and  Dominion  Sec.  Corp. 

National  City  Co.   and  Syndicate 


2,000,000 
1,500,000 
1,000,000 

3,000,000 


200,000 
2,000,000 


I 


1,602,000 
4,000,000 

2,000,666 

3,000,000 


■ 


January   6,   1922. 


THE      MONETARY      TIMES 


101 


British    Columbia    1,000,000 

Quebec     2,000,000 

Quebec     2,800,000 

Svpleniber 

Ontario     16,000,000 

Ontario     15,000,000 

Alberta     2,250,000 

Alborta     2,100,000 

October 

Manltot)a     3,725.000 

British    Columbia    2,000,000 

British    Columbia     2.000,000 

Alberta     1,800,000 

Alberta     1,053,003 

Nova    Scotia     1,800,000 

Manitoba 1,000.000 

Prince  Kdward  Island    125,000 

November 

Quebec     4,000,000 

Saskatchewan     5,000,000 

Nova    Scotia     558,000 

Alberta     2,297,400 

AllKTla     700.000 

Manlliiha      100.000 

PROVINCIAL  TREAS.   BILLS 

January 

Manitoba     »1. 250,000 

March 

Ontario     6,000,000 

Api'll 

Ontario     4,000,000 

Manitoba     2,500,000 

July 

Ontario     15,000,000 

Dft'einlier 

Oalt    .              :i»9,23ii 


6  20  years 
6Vi  16  years 
6H     15  years 


•Offering  price, 

MUNICIPALITIES 
January 

Winnipeg 11,500,000 

Halifax     325,000 

February 

Toronto      5,037,000 

Winnipeg^     1,250,000 

March 

Montreal    (Prot.   Sch.)    1,500,000 

Toronto    (Sep.    Sch.)    350,000 

April 

Quebec   810,000 

May 

Greater   Winnipeg   Water    . . .  1,600,000 

Windsor,   Ont 625,230 

June 

Toronto 5,000,000 

l&  Tuque,   Que 300,000 

July 

Outremont,    Que 750,000 

St.   Lambert,   Que 600,000 

CalBary    100.000 

.'\u8ruMt 

York  Township,  ©nt 54B,787 

Three  Rivers.   Que 332.600 

Halifax     350,000 

Edmonton      2,500,000 

September 

Toronto    10,000,000 

Toronto    6,000,000 

Toronto  (Harbor  Comm.)    4,000.000 

Ottawa     1,808.759 

Retina 465.500 

Shcrbrooke,   Que 309.000 

October 

WinnipeB     1,529,000 

Montreal    700,000 

St.    John,   N.H 646.000 

RcRina     218,064 

IVot'eniber 

Hamilton     1,222,439 

Windsor     916,437 

Montreal    1,250,000 

St.    Boniface     427,000 

CORPORATION 

January 

Maritime  Teleff'ph  &  Tel.  Co.  J500,000 

Consumers'    Glass   Co 550,000 

Fort  William   Paper  Co.,   Ltd.  1,000.000 

February 

Howd   Smith    Paper  Mills,  Ltd  1,000,000 
Spanish    River    Pulp    &    Paper 

Co.,     Limited     3,000,000 

Abltilil   Power  &  Paper  Co...  4,000.000 

March 

Frascr   Companies,    Ltd 2.000,000 

Cl.irko  Bros.    Paper  Mills    ....  1.250.000 

P.  T.   LeRare.  Ltd 1,200,000 

Wesfn  Quebec  Power  Co.,  Ltd  200,000 

April 
National    I-'armlngf  Machinery, 

Ltd.    (1st   mort.)    4,000.000 

Brompton    Pulp    &    Paper    Co. 

(K'en.    mtge.    conv.)    2,600.000 

Laurentide  Power  Co 1,600.000 

Laurentian  Power  Co.,  Ltd...  1,000.000 
•Canada     Land     &     Irrigation 

Co.    (£300.000)    1.458,000 

May 

LamontaKne,  Limited 600,000 

Canadian  Salt  Co.,  Ltd 400.000 


8 


22  years 
22  years 
20  years 
10  years 

26  years 
26  years 
20  years 
20  years 
20  years 
15  years 
25  years 
10  years 


5%  15  years 
5^  26  years 
6  20  years 
6    10  &  15  years 

'i  20  y«;ari» 
6     10  yoara 


98.69 
100.00 
100.00 

96.64 
106.600 

96,67 
103.021 

106.750 
95.39 

104.651 
96.674 
97.60 

106.17S 

106.760 
99.199 

97.62 
104.067 

98.70 
100.00 


6 

6 

6 
6K 


6  moB. 
6  mos. 
6  mos. 


6  6  mos. 

.  &  6      15-40  yrs. 


99.63 


99.63 
100.00 


99.837 

99.86 


6 
6 

6 
6 

6V4 


30  years 
10  years 

30-yr.  ser. 
20  years 

30-yr.  aer. 
20  years 

10  years 

30  years 
20  &  30  Inst. 

serials 
5  years 

10  years 
10  Inst. 
3  years 


96.63 
96.66 

98.94 
97.89 

97.884 
96.79 

99.13 

94.16 
94.846 

96.38 
97.80 

94.16 
96.76 
97.00 


6  20  &  30  years  94.936 

6         10  years  97.81 

6  10  years  96.66 

7  20  years  93,00 


6 

6 

4H 

6 

6 

6 


30-yr.  ser. 
30-yr.  ser. 
32  years 
various 
26  years 
10  years 


6  26  years 

6  10  years 

6  10  years 

6Vi  80  years 

6  &  6  various 

6Vi  &  6  various 

6  6  years 

6  16  years 


26  years 

16  years 
serials 

20  years 

20  years 
10  years 

20  years 
15  years 


105.196 

95,428 

82,03 

106,366 

101,27 

98.00 

106.645 
98.447 
97,876 

102.69 

98,903 
98.887 
98.69 
88.00 


6Vi     10  years 


5  years 

20  years 
16  years 
20  years 


serials 
20  years 


6.68 
6.60 
5,50 

6.28 
6.63 
6.40 
6.60 

6.60 
6.37 
5.61 
6,39 
6,31 
6,39 
5,60 
6.11 

6.76 
6.20 
6.11 
6.00 


6,!(8 


6.98 
6.60 


6.36 

5,8» 


A.   B.  Ames  &  Co.  and  SyndiCAt*. 

Unknown 

Delivered    to    Universities 


6,25 
6,42 

6,11 
6.19 

6.20 
6,29 

6,12 

6,44 
6,56 

6,34 
6.63 

6.30 
6.70 
7.10 

6.65 
6,30 
6,46 
7,70 

6,56 
6.42 
5.73 

5.70 
6.26 

6.25 
6.21 
6,29 
6.30 

5,87 
6,10 
6.31 
6.60 

OtferlriK 
TIeld 

7.26 


S  00 
7  90 
8,10 

8.10 

v.  6  6 

8,26 
7.00 
7  60 
7.00 


A.  Jarvis  &  Co.  and  .Syndicate.  , 
R.  A.  Daly  &  Co.  and  Syndicate, 

A.  JarvlH  &  Co.  and  Syndicate 

Guaranty  Trust  Co.  and  SyndlCAta.. 


Dominion  Securities  Corp 

A.  E.  Ames  &  Co.  and  Wood,  Oundr. 

Dominion  Securities  Corp 

A.   K.   Ames   &  Co 

A.   E.   Ames  &  Co 

McLeod,   Young,   Weir  ft  Co 

Dominion  Securities  Corporation 

A.   E.   Ames  &  Co 


Harris,  Forbes  &  Co.  and  Syndicate. 
Wood,  Gundy  &  Co.  and  Syndicate.. 
W.   F.  Mahon  &  Co.  and  Syndliat 
Locally   during   year 

Flr»t    National    Co. 
Ruyal   8ecurltl«s   Cor  i 


A,   E.  Ames  &  Co.  and  8yndlcat<- 

A,  E.  Ames  &  Co.  and  Syndicate 

A.  E.  Ames  &  Co.  and  Syndicate 

Canadian    Bank 

Dominion  Securities  Corp.  and  Srndieate. 

McL^od,    Young,    W«lr   &    Co 


A.   E.  Ames  &  Co.  and  local  I 
Local    Dealers 

Local  Syndicate. . 
Wood,  Gundy  &  Co,  . 

Wood.  Gundy  &  Co... 
National  City   Co.,  Limited    . 


'.000,000 
2.100,000 
3.726.000 

t,ooo,66o 

i.Vo'o'oio 

5.000,660 


United  Fin.  Corp.  and  Syndicate 

Dominion  Securities  Corp.  . 
A.   Jarvis  &  Co 


National  City  Co.   and  Syndicate 
Municipal   Debenture  Corp 

Beausollel,    Limited 

Versailles.    Vldricalre    ft    Boulals 
Ross  Alger  &  Co 


Wood.  Gundy  &   Co 

Provincial   Securities,  Ltd. 

J.  M.  Robinson  &  Sons 

Wood.   Gundy   &  Co 


National   City  Co.  and  Syndicate, 
National  City   Co.  and  Syndicate... 
R.  A.  Daly  &  Co,  and  Syndicate.... 
Wood,  Gundy  ft  Co.  and  ."^vndioale. 
Wood.  Gundy  ft  Co... 
Rene-T.  Leclerc 

A.  E.  Ames  ft  Co.  and  Syndicate 
Ames  &  Co.  and  Hanson  Bros.  . . 

Royal    Securities    Corp 

Wood,  Gundy  ft  Co 


A.  E,  Ames  &  Co.  and  Syndicate. 

Wood.  Gundy  ft  Co 

National  City  Co..  Limited 

Miller   &  Co.   and   Syndicate. 


'Harris,   Forbes   ft  Co.,   Inc.   and   the  Royal 

Securit  les  Corporation , 

Privately    

Ppnb<.<!y.    IIiUtllnK    A    Co 

Aldr  nd    AMoclii-    - 

Royal  Securities  Corporation 
Peabody,  Houtiing  ft  Co... 

Royal  Securities  Corp.  ft  United  Fin.  Corp 

John   Stark   ft   Co 

Versailles,   Vldricalre    ft    Boiit«l« 
Balfour,   White  ft  Co 

La  Banque  Natlonale. 

Oreenshleld  ft  Co 

Sun  Life  Assurance  Co 


Versalllfs.  Vidric.iire  ft  Boulals, 
Royal    Securities    Corporation... 


1100,000 


10,000,000 

4.'ooo,o6f 

l.SOS.TC* 
4(S.B00 


i.tso.ooo 
tis.Hi 

417.000 


102 


THE      MONETARY      TIMES 


Volume  68. 


July 

Shawinigan  Wat.  &  Pow.  Co. 
September 

Mount    Ruyal    Hotel    Co 

Cedars  Rapids  Manufacturing 

&  Power  Company    

Maritime  Teleg'pli   &  Tel.  Co. 

Octolier 
Manitoba  Power   Co 

November 
Canada  Steamsliij)  Lines,  Ltd. 
Canada  Steamship  Lines,  Ltd. 

Montreal  Tramways  Co 

Border  Cities  Hotel  Co.,  Ltd.. 

Pedlar  People,  Ltd 

St.  John  Dry  Doclc  &  Ship.  Co. 
Dominion  Park  Co 

l>e<-einber 
Imperial   Tobacco   Co.   of   Can.    . .  . 
Benson  &  Hedges   (Can.)   Ltd.    .  .  . 


2,500,000 

6 

29  years 

6.75 

6,000.000 

8      < 

onvertible 

8.00 

1,000,000 
500,000 

5 

7 

40  years 
24  years 

6.25 

7,600,000 

7 

20  years 



7.00 

3,609,200 
2,390,800 
1,750,000 
850,000 
500,000 
392,825 
150,000 

7 

7 

5 

7% 

8 

5Mi 

7 

10  years 
10  years 

various 
various 
various 
15  years 

100.00 
97.00 

100.66 

100.00 
95.13 

7.00 
7.43 

V.SO 
8.00 

G,.i00.000 

7'« 

•onvertible 

960,000 

8>/i 

2  5  years 

Lee,   Higginson   &   Co 

\V.   A.    Mackenzie   &   Co.   and  United  Hotels  Co. 


Wood,  Gundy  &  Co 

Royal    Securities    Corporation. 


Nesbitt,  Thomson  &   Co.  and  Associates.. 


Municipal   Debentures   Corporation. 

Shareholders   

Harris,  Forbes  &  Co 

W.   A.  Macltenzle  &  Co 

Graham,  Sansom  &  Co 

A.   Jarvis  &   Co 

National  City  Co 


2,500,000 
1.000, 000 
1,000,000 

4,000,000 

i,V5'o,666 


Sf>ld    in    Great    Britain 


•Sold  in  London,  England  at  par.     Redeemable  1929  and  1933  at  100  per  cent,  premium. 


RAILROAD 
January 

Grand  Trunk  Rly $12,000,000 

July 
Canadian  Northern  Rly 25,000,000 

Seiiteiulier 

Canadian   National   Rlys 25,000,000 

Canadian    Pacific    Rly 9.73.^,200 

Canadian    Paciflo    Rly 25,000,000 


6% 


15  years 
25  years 

15  years 

deb.  stock 
pf.  deb.  stk. 


78.00 


7.00         Dillon,  Read  &  Co $12,000,000 

6.80       "Dillon,  Read  &  Co 25,000,000 

25,000,000 

25,000,000 


6.50         Dillon,  Read  &  Co. 
....  Sold  in   G-reat   Britain 

5.13  National    City    Co.     .. 


SUMMARY  OF  BOND  SALES  IN  ALL  MARKETS,  1908-21 


Bond.s 

Sold 
in 

Canada 

January 

1920 

Miinloii)al    

Railroad    

3,404,077 

Corporation     .... 

650,000 

4,054,077 

Ciovernment    

500,000 
1,443,405 

Municipal    

lUiilroad     

Corporation           . .     ' 

160,000 

March 

liovernnient 

2,103,.i05 

Miinicij'al     

6,659,566 

Raili'oatI     

Corporation   

1,115,276 

7,774,842 

2,000,000 
4,962,368 

Ainil 

Municiiial    

Railroad    

Corporation     , 

1, '975,666 

8,937,368 

S.SOO.OOO 
915,715 

May 

Governmpnt     

Railroad    

4,000,000 
7,715,745 

June 

s.ooo.nno 

3,949,411 

Municipal   

1,000,000 

7,949,411 

■ 

Sold  in 
United 

States 

Sold 

m 

Canada 

1920 
8,950,000 

1921 

$ 
16,250,000 
5,754,000 

7,500,000 

2,050,000 

16,450,000 

24,054,000 

2,498,000 

2,275,000 

9,660,603 

4  000  000 

4,773,000 

14,850.000 

1,987,000 

24,000,000 

13,660,503 

6.000,000 
5,671,037 



4.925  000 

•      ' 

40,837,000 

16.596,037 

8,300,000 

9,840,000 
3,202,877 

9,750,000 

t10,458,000 

18,050,000 

23,500,877 

9,500,000 

19.680.000 
i  699  596 

15.000,000 
1.000,000 

i',66o,'o66 

25.500,000 

2.000,000 
200,000 

25,379,526 

7,500.000 
6,092,406 

4,000,000 

6,200,000 

13,592,406 

Sold  In 
United 
States 

1921 
$ 

2,000,000 


4,000,000 
4,000,000 
4,500,000 


4,500,000 
3,000,000 


3,000,000 


2,300,000 
155.000 


1,502,000 


Bonds 

Sold 

in 

Canada 

MUy 

1920 

5,000,000 
2,718,380 

(lorporaiion       

375  000 

A 11  nil  St 

8,093,380 

200,000 
2,900,430 

3,250,666 
6,3.50,430 

Septcnihcr 

3,000,000 
877,676 

Municipal    

Ocloher 

OovorniiUMiI     

3,877,676 
3,517,354 

Hailroad            

(lorporaiion 

900  000 

Xovcnibfi" 

ii<i\('i'n!nt'nl 

4,417,354 

Munici[>iil 

5,386,424 

Corporation                

200,000 

Decemhcr 

Govprnnient       

5,586,424 
20.250,000 

Mnnlcipa!       

9,570,555 

5,150,000 

134,970,555 

sold  m 

united 
States 

Sold 

in 

Canada 

1920 

i 

13,800,000 

1921 
« 

17,500,000 
3  364  733 

m',666 

13,925,00fl 
10,595,000 

20,864,733 

6,506,132 

100,000 

10,695,000 

6,506,132 

750,000 
4,804,000 

17,250,000 
7,349,458 

5.500  000 

5,554,000 
9,250,000 

30,099,458 

5,143,000 
r    2,820  610 

25.bbb.666 

5,800,000 

39,450,000 

8,750,000 

3,500,000 

11,463,610 

4,558,000 
6,419,782 

25,000.000 
600,000 

'9,642,825 

34,350,000 

20,620,607 

2.397.400 

800,000 

6.5bb',666 

3,799,254 
t9.733.200 
t7,460,000 

7,300,000 

23,389,854 

Sold  m 
United 
States 

1921 

« 

6,000,000 

100,000 

2,500,000 

25,000,000 

33,600,000 


4,000,000 
38,300. 


4,038,300 


60,504,259 

8,525,000 
1,742,054, 

4,000,666 


14,267,054 


5,577,000 


26.420,000 


Sold  in 


Canada    

United    States    .. 
United   Kingdom 


Government 


1020 

$ 

36.750,000 

89,243,000 


106,118,100 
54,627,000 


1920 

« 

16,305,391 

10,066,000 


Municipal 


1921 

? 
65,310,318 
19,436,613 


Railroad 
1930  1         1921 


),600,000    I     87,000,000 
I      9,733,000 


1920 

i 

18.775,276 
27,275,000 


Corporation 


1921 

» 
11,867,825 
17.050.000 
2,418,000 


Totals 


1920 
I  * 

101,830.667 
223.081.000 


1921 

« 

213,326.543 

17S.1 13.613 

12.151.000 


125,993.000    I     160.745,400    I      56;371,391     |      84,776,931     |       96,500,000    I    96,733,000    |    46,050,276    I    61,335,825     1324,914,667    i  403,591,156' 


Sold   m 

Canada 

* 

1908 

21,585,140 

1909 

60.433.961 

1910 

39.296.462 

1911 

14.989.878 

1912 

37,735,182 

1913 

45,603,753 

1914 

32.999,860 

Sold  in 

United 

King-dom 


I 


I 


Sold  in 
UnitPd 
States 

6.316,3.50 
10,367.500 

3,634.000 
17,5,53,967 
30,966,406 
50,720,702 
53,944,548 


Total 


196,356,521 
265,158,252 
231,0T)0,590 
266.812,988 
272,937,982 
373,795.295 
272,935.067 


165,455,031 
194,356,788 
188,070,128 
204,269,143 
204,236,394 
277,470,780 
185,990,659 

••Included  in  this  sum  are  $8,0i:Hl,n00  of  a  total  of  .?50.000,000  Canadian 

end  of  1916.    The  inclusion  of  the  $43,000,000  of  unclassified 'repurchases  b 

•In  the  above  tables  it  has  been  estimated  that  of  the  first  Canadian  w 

States;    second  loan  of  .?i00,ono,nno  in  September,  lOlfi,  830,000,000  in  the  V 

United  States;  fourth  loan  (alloUed)  of  $400,000,000  in  November,  1917,  $10, 

tincluded  In  the  December  figure  Is  tbf  .Tiiiniint  of  domestic  loans  ma 

loans  were  made  over  an  indefinite  period,  it  is  not  oossible  to  classify  b 

imate  amount  sold  during  the  year,  is  also  shown  iii  the  December  Muni 

Note.— In  addition  to  the  above  loans,   advances  for  war  purposes  ha 

established  credits  here  for  the  British  Government.     These  loans  are  no 

}  $1,4.58,000  of  Canada  Land  &  Navigation  Co.  sold  in  U.K.    C.P.R.  deb. 


•1915 
•1916 
1917 
1918 
1919 
1920 
1921 


Sold  m 

Canada 

$ 
114,275,214 

102,938,778 
546,330,714 
727,446,361 
705,385,419 
101,830,667 
213,326,543 


Sold  m 

United 

Kingdom 

$ 

41,175,000 
5,000.000 
5.000.000 

14,600,000 
5,105,133 


Sold  m 

states 

United 

S 

178,606,114 

206,943,7M 

174,708.365 

33,310,000 

199,446,670 

223,084,000 

178,113,613 


Tota' 


335,106,328 
•356.882.542 
726.039.079 
775.356.361 
909,937.222 
331.914.667 
403.591,156 


.1 


12,151,000 
bonds  repiivchaspd  in  United  Klngilom  since  the  w^ir  commence,!  io  the 
rings  the  total  of  Canadian  bond  sales  in  1916  to  $356,000,000. 
ar  loan  of  $100,000,000  In  November,  1915.  $25,000,000  was  sold  in  the  United 
nited  states;  third  loan  of  $150,000,000  in  March,  1917,  $35.ono.i)i)0  in  tne 
ono.ono  in  the  United  States,  fifth  loan  $25,000,000  in  the  United  States, 
do  during  the  vear,,  totalling  approximately  $7,000,000.  As  most  of  those 
y  months.  $2,100,000  of  Saskatchewan  rural  telephone  bonds,  the  approx- 
cipal  total. 

ve  been  made  to   Canada  by  the   Imperial   Government,   and   Canada  has 
I  included  In  the  above  figures, 
stock  sold  nl  U.K.    $960,000  Benson  k  Hedges  (Can.)  Ltd..  sold  in  U.K. 


January  6,  1922. 


THE      MONKTAUY      TIMES 


103 


HTOCK  OFFKKING.S   80A1MJE   IxABT  YEAK 


A  (oiirnisi  To  1!»2(> — The  Effect  of  Eeonomic  (Gondii lonx 
Kntci'prlHU  ut    Low   Kbb. 


-A  S  I'^AR  as  new  stock  issues  are  concerned,  1921  has  been 
*»  void  of  any  particular  interest,  unlike  the  previous 
year,  when' there  was  a  flood  of  such  securities,  and  a  con- 
siderable number  of  capital  adjustments.  A  feature  of  1920 
was  the  large  number  of  preferred  offerings  by  industrial 
companies,  pailicularly  pulp  and  paper,  theatres,  banks  and 
public  utility  and  other  companies.  But  most  of  the  new 
financing  last  year  was  in  the  form  of  bonds. 

This  is  not  very  hard  to  undeistand  in  view  of  the 
circumstances.  Nineteen-twenty  was,  practically  speaking, 
a  year  of  prosperity,  as  was  the  previous  year,  while  1921 
was  one  of  distinct  reaction  and  uncertainty.  Considering 
this  fact  in  connection  with  the  difference  between  bonds 
and  stocks,  explains  the  situation. 

The  bond  is  a  mortgage,  and  the  holder  a  secured 
creditor.  If  principal  and  interest  are  not  paid,  bondholders 
can  foreclose.  Bond  principal  and  interest  are  prior  charges 
on  assets  and  earnings.  On  the  other  hand,  stocks  are 
equities.  Shareholders  are  partners,  not  creditors.  Their 
-share  is  that  part  of  the  assets  and  earnings  which  are 
left  after  satisfaction  has  been  made  for  bondholders  or  other 
creditors.  Returns  on  stocks  are  likewise  uncertain,  fluctuat- 
ing with  industrial  prosperity  and  depression. 

It  is  quite  apparent  then  that  anyone  with  common 
sense  who  has  any  money  to  invest  will  choose  that  with 
the  most  tangible  security  behind  it,  and  on  this  basis  the 
stock  naturally  takes  place,  particularly  stock  of  a  new 
enterprise  which  has  not  yet  appi'oved  itself.  This  seems 
to  make  it  quite  clear  why  1921  did  not  see  a  very  large 
number  of  stock  issues,  not  forgetting  the  important  fact 
also  that  enterprise  is  always  at  low  ebb  during  depression 
to  a  degree  correspondent  to  the  reaction,  consequently  low- 
ering the  demand  for  new  capital. 

Preferred  Issues 

There  were  some  stock  issues,  however,  and  these  can 
be  briefly  reviewed  as  follows:— 

English  Electric  Company  Of  Canada,  a  subsidiary  of 
the  British  enterprise  of  the  same  name,  issued  $2,000,000 
8  per  cent.,  preferred  stock  to  the  Canadian  public  through 
the  Canadian  Debenture  Corp.,  Ltd.,  at  par,  with  a  bonus 
of  40  per  cent.,  common.  ^ 

Anglo-American  Motors,  Ltd.,  issued  $4,500,000  8  per 
cent,  cumulative  preferred  shares,  the  price  being  par,  $100, 
with  a  bonus  of  40  per  cent.,  common. 

New  Windsor  Hotel  Co.,  Ltd.,  $1,000,000  8  per  cent, 
cumulative,  sinking  fund.  Underwriters,  B.  N.  Rosenbaum, 
of  New  York  and  Montreal.  Price,  par  ($100),  with  bonus 
of  one  $10  share  of  common. 

Dupuis  Freres,  Ltd.,  $1,500,000  8  per  cent.,  cumulative 
callable  preferred  stock.  Underwriters,  Le  Credit  National, 
Ltd.,  Montreal. 

Ames  Holden  Tire  Company,  Ltd.,  $650,000  8  per  cent., 
cumulative.  Underwriters,  Federal  Finance  Corp.,  Ltd.,  To- 
ronto. Price,  $450  for  four  shares  of  preferred  and  one 
of  common.  Both  preferred  and  common  have  a  par  value 
of  $100  each. 

These  are  the  principal  preferred  issues.  Of  course, 
there  have  been  a  few  other  small  ones,  some  of  which  have 
no  doubt  been  taken  up  without  public  offering. 

Oommon  Stocks 

The  following  were  the  principal  offerings  of  common 
stock  to  the  public: — 

New  Windsor  Hotel  Company,  Ltd.,  $2,000,000.  Under- 
writers, B.  N.  Rosenbaum  &  Company.  Price,  $7  per  share 
of  $10  par  value. 

Alberta  Flour  Mills,  Ltd.,  $2,500,000.     Direct  to  public. 

Cosgrave  Export  Brewery  Company,  $1,000,000.  Sold 
thiounh   Montreal  brokers  at  i):i'-   <'^'"'>. 


Bell  Telephone  Company  of  Canada,  $5,725,000.  To 
shareholders  at  par  at  the  rate  of  one  to  every  four  held. 

Canadian  General  Electric  Co.,  Ltd.,  18,000  new  f-harefi 
of  common,  being  a  bonus  to  shareholders. 

Consumers  Gas  Company,  Toronto,  12,786  shares,  of- 
fered by  Osier,  Hammond  and  Company  and  the  United 
Financial  Corp.,  Ltd.,  at  $62.50  per  $60  share,  to  yield  8 
per  cent. 

New  Brun.swick  Telephone  Company,  $200,000  of  stock 
issued  to  shareholders. 

Durant  Motors  of  Canada,  Ltd.,  $750,000.  Offered  at 
$10  per  share,  and  is  convertible  at  the  option  of  the  holder 
into  capital  stock  of  I>urant  Motors  Incorporated,  the  parent 
company  in  the  United  States,  on  or  after  August,  1924, 
at  $30  per  share  for  the  parent  company  and  par  for  the 
Canadian  company. 

Great  West  Bank  of  Canada,  $2,000,000,  offered  at  $125 
per  $100  share. 


SO>rK   ANOMALIES  IN  MUNICIPAL     OOVFnVMRVT 


Will  of  I  Ik-  Miijoriiy  Does  Not  Alwayx  Rule  in  i  i 
as  It  I><M>s  in  Dominion  junl  Provlncal  Ar. 


\,' 


By   H.4RRV   BRAG<; 

THERE  are  two  rather  curious  anomalies  in  the  muni- 
cipal field  which  prevent  the  good  working  of  the  muni- 
cipal machinery  to  a  certain  extent.  A  rery  general  claim 
is  that  we.  in  the  British  Empire,  enjoy  that  blessing  of 
democracy,  and  that  "The  Majority  always  governs."  The 
accepted  rule  in  all  elections,  Federal,  Prorlnclal  and  Muni- 
cipal, is  that  those  who  carry  on  the  functions  of  goremins. 
are  representatives  of  the  majority  of  those  who  are  gov- 
erned. 

Lately,  some  new  Ideas  have  been  Imported  from  acroae 
the  line,  such  as  Proportional  Representation,  tht  Referen- 
dum and  the  Recall.  And  It  may  be  noted  that  the  archale 
machinery  of  elections  in  the  "Land  of  Liberty"  is  largely 
responsible  for  an  earnest  desire  for  improvement.  It 
should  also  be  remarked  that  the  cures  for  diseases  are 
not  necessary  when  the  diseases  do  not  exist.  Some  woold- 
be  progressive  people  grasp  at  new  Ideas,  without  consid- 
ering whether  they  are  necessary,  or  even  H'ivi^<.>.i.>  .,•""•• 
other  conditions. 

Majority  of  Voters 

However,  In  the  main,  the  will  of  the  majority  does  pre- 
vail in  the  Federal  and  Provincial  elections.  That  Is,  the 
will  of  the  majority  of  those  citizens  who  are  sufflciently 
patriotic  to  do  their  duty,  and  record  their  votes.  Aa  to 
those  lazy  and  careless  citizens  who  do  not  vote,  they  cer- 
tainly do  not  deserve  any  representation  af  all. 

But  In  municipal  elections,  a  very  hard  and  fast  line 
is  drawn,  as  to  who  shall  vote;  and  the  right  to  rote  Is 
not  dependent  upon  residence,  or  ownership  of  property,  but 
upon  having  paid  the  current  Jaxes,  if  the  voter  is  a  pro- 
prietor. That  is  to  say,  that  the  right  to  vote  may  be  can- 
celled, and  is  in  most  cases.  If  the  taxes  due  are  not  paid. 

The  argument  in  favour  of  such  a  law  is  a  valid  one.  It 
is  that  the  municipali,ty  has  to  provide  certain  things  for  the 
property  owners,  which  cost  money,  and  that  the  said  owner 
is  bound  to  pay  his  share  of  the  expenses  incurred  by  the 
municipality.  Further,  if  the  owner  has  not  paid  what  is 
due  from  him,  he  is  not  entitled  to  choose  who  shall  man- 
age the  expenses  of  his  municipality. 

How    It    Operates 

This,  on  the  fare,  is  very  proper,  but  how  doe*  it  work 
out? 

An  owner  may  have  half  a  dosen  tenants,  who  are  all  In 
arrears  In  paying  their  rent  to  him.  Aa  a  eoBMqaence.  :i« 
cannot  pay  his  taxes.  But  the  tenanu.  by  paying  their 
water  rate  to  the  municipality,  are  entitled  to  vote,  and  help 
to  choose  the  men  who  are  to  adminlater  the  finances  of  the 
munclpality  in  which  their  landlord  has  to  pay  taxec. 

An  extreme  case  would  be  that  in  which  the  teaaats, 
who  have  no  permanent  interest  in  the  place,  have  the  pre- 
ponderance of  the  vA.i.,»  „.,,,-    because  the  proprietora. 


104 


THE       MONETARY       TIMES 


Volume  68 


who  are  permanently  interested,  are  in  arrears  with  their 
taxes,  and  are  consequently  disfranchised. 

A  case  in  point  exists  within  a  short  distanct  of  Montreal. 

A  large  number  of  the  proprietors  in  this  municipality 
are  workng  men,  who  have  saved  up  sufficient  money  to 
buy  a  lot  on  time,  and  have  secured  lumber  on  the  same 
terms,  and  utilize  their  leisure  In  building — not  a  house, 
but  a  home.  Owing  to  the  hard  times,  many  of  these  men 
are  behind  in  their  taxes,  and  are,  therefore,  unable  to  vote. 
So  the  real  estate  dealers,  and  similar  temporarily  interest- 
ed voters,  control  the  situation.  And  as  a  result,  the  Coun- 
cil of  that  municipality  does  not  represent  the  majority,  but 
only  a  majority  of  a  small  minority  of  the  proprietors. 
Not  Rule  By  Majority 

This  municipality  is  certainly  not  governed  by  the  ma- 
jority. 

Another  curious  situation  is  found  not  far  away  from 
that  already  noted. 

In  a  certain  municipality  contiguous  to  the  "Commercial 
Metropolis,"  there  has  been  a  good  deal  of  the  real  estate 
development  which  has  been  such  a  curse  in  many  parts  of 
the  Dominion.  The  smooth-tongued  salesmen  got  people 
to  believe  that  the  lots  they  were  selling  would  be  actually 
sold  again  at  many  times  the  original  price.  So  many  in- 
vested— or  rather,  gambled — and  bought  lots,  not  to  build 
on,  but  to  sell  again  later  on.  Of  course,  as  in  other  places, 
these  lots  have  never  risen  to  the  fabulous  prices  that  the 
salesmen  promised,  and  the  owners  have  had  to  keep  pay- 
ing interest,  without  any  return,  or  chance  of  disposing  of 
them. 

But  quite  a  few  lot  owners  built  their  own  houses,  and 
went  to  live  in  the  town,  getting  out  of  the  overcrowded 
city  into  comparative  country. 

Needless  to  say,  the  house  builders  found  that  the  taxes 
on  the  property  <hey  had  thus  improved  .for  the  Town,  as 
well  as  for  themselves,  were  very  much  higher  than  the 
taxes  on  the  vacant  lots,  held  by  the  speculative  buyers.  And 
in  some  cases,  while  the  speculators  were  able  to  pay  the 
trifling  tax  on  vacant  property,  the  house  owners  were  too 
hard  pressed  to  do  so. 

Consequently,  the  land  speculators  were  in  a  majority 
at  the  last  election,  and  the  Mayor  was  elected — ^not  by  his 
resident  fellow  citizens — but  by  what  have  been  termed  the 
"land  sharks,"  whose  only  aim  is  to  get  the  Town  into  such 
a  shape  as  makes  it  easy  for  them  to  sell  and  get  out.  As 
a  matter  of  fact,  while  the  majority  of  the  Mayor  at  the 
election  was  17,  the  vote  in  the  residential  polls  was  more 
than  one  hundred  against  him. 

Is  it  not  an  anomaly  that  the  men  who  govern,  and 
finance  any  place  should  be  elected  by  the  land  speculators, 
and  not  by  those  who  have  helped  to  build  up  the  muni- 
cipality? 


FIVE  DECAOES  OF  BORROWING  IN   BRITAIN 

Canada's  Credit  In  Iiondon  Was  Always   Gtood,  And  Two 
And  One-Half  Per  Cent.  Bonds  Were  Floated  In  1897. 

By  J.  DOWER 

WLL  Canada  be  a  borrower  in  the  London  market  during 
1922?  This  query  brings  forth  many  interesting 
thoughts,  but  was  evoked  by  the  financial  needs  of  the  Do- 
minion Government  during  the  coming  year,  as  well  as  by 
the  various  borrowings  by  the  Australian  and  South  African 
Governments  during  the  past  months   in  London. 

In  anticipating  the  Finance  Minister's  reply  to  such  a 
query  many  factors  have  to  be  borne  in  mind,  such  as  the 
pxchange  problem,  the  actual  state  of  the  London,  New  York, 
and  also  the  Canadian  bond  markets,  and  again  that  British 
slogan  which  is  being  given  prominence,  namely,  "Trade 
should  follow  the  Loan." 

Outstanding  Debt  in  London 

These  factors  make  a  review  of  Canada's  British  bor- 
rowings timely.  First,  then,  what  is  the  outstanding  debt 
in  London?  In  the  year  1868  the  total  was  $07,000,000,  this 
had  reached  at  the  outbreak  of  war  in  1914  the  sum  of  $319,- 
000,000,  and  to-day  stands   at   $336,000,000.      In    1914    the 


Dominion  funded  debt  payable  in  London  was  practically  the 
sum  total;  to-day  it  constitutes  less  than  one-sixth  of  the 
debt. 

Now  as  to  the  actual  borrowings,  during  the  first  five 
years  of  Confederation  there  were  only  the  following  loans: 

1869,  $7,300,000  4%  Intercolonial  Railway,  guaranteed. 

1869,  $2,433,333  5%  Intercolonial  Railway,  unguaranteed. 

The  next  ten  years  saw  five  loans  floated  as  follows : 

1874    $19,466,666  4% 

1875   4,866,666  4% 

1876    12,166,666  4% 

1878 14,600,000  4% 

1879    14,600,000  4% 

This  last  loan  was  marketed  at  the  rate  of  £95  Is  10%d. 
Decline  in  Interest  Bates 

Canada  now  begins  to  enter  a  very  interesting  period  in 
her  borrowings.  The  report  of  the  finance  department  refer- 
ring to  the  loan  of  1884  states  this  was  the  first  loan  floated 
by  a  British  Dominion  at  the  low  rate  of  SVii'/r.  The  price 
obtained  for  this  loan  was  £91  Is  8d.  For  the  1885  4%  loan 
the  average  price  received  was  £101  Is  SVjd.  Then  in  1888 
Canada  was  again  the  fir.st  Dominion  to  receive  a  lower  rate 
of  interest,  this  being  3%,  and  the  average  price  £95  Is  lOd, 
the  total  sub.scription  for  the  £4,000,000  issue  being  £12,000,- 
000.  The  loans  in  1892  realized  £92  lOVad.  During  1894 
the  B.  C.  loan,  the  last  of  Government  loans  prior  to  Con- 
federation, was  redeemed.  In  1894  also,  for  the  £2,250,000 
3%  loan,  566  tenders  for  £11,294,222  at  average  rate  of  97.92 
were  received.  This  loan  surpassed  any  previous  issue  in 
point  of  value  received  and  number  of  tenders.  The  loans 
from  1884  to  1894  were  as  follows: 

1884    $24,333,333  3^!% 

1885    19,466,666  4% 

1888    19,466,666  3% 

1892    18,250,000  3% 

1894    10,950,000  3% 

In  October,  1897,  Canada  for  a  third  time  was  the  first 
overseas  British  Dominion  to  receive  lower  interest  rates  and 
to  issue  a  loan  at  2V::Vr,  and  £91  10s  5d  was  average  price 
realized  for  a  loan  of  $9,733,333.  Ten  years  elapsed  before 
the  next  public  Government  ofl'ering,  this  was  in  1907.  The 
loans  from  that  date  to  the  outbreak  of  war  were  a.s  below: 

1907   $  7,300,000  4'7( 

1908 14,600,000  3V2% 

1908    24,333,333  3%% 

1908    24,333,333  3V«% 

1909    29,200,000  3%% 

1909    31,633,333  SV2% 

1910    19,466,666  3%% 

1910 24.333,333  3y2% 

1912    24,333,333  31/2% 

1913    14,600,000  4% 

1913   19,466,666  4% 

1914    24,333,333  4% 

1914    24,333,333  4% 

In  the  next  year  two  visits  were  made  to  the  London 
market,  the   amounts  of  the  loans  were: 

1915    $11,193,333  4% 

1915    24,333,333  41/2% 

End  of  Borrowings 

This  was  the  end  of  Canadian  governmental  public  of- 
ferings in  the  London  market.  Of  this  stoppage  Sir  Thomas 
White  says:  "By  June  of  1915  exchange  had  become  un- 
favorable to  London,  and  the  problem  of  how  to  find  funds 
to  continue  to  purchase  in  constantly  increasing  amount  in 
the  United  States  and  Canada  became  a  very  vital  one  for 
the  Briti.sh  Treasury.  It  was  this  which  led  later  on  to  the 
issues  of  British  loans  in  New  York  and  to  the  successive 
war  loans  in  Canada." 

It  should  be  noted  the  total  amount  of  all  these  loans  was 
less  than  $500,000,000,  which  makes  the  war  financing  of  the 
Dominion   stand  forward  as  a  remarkable  achievement. 

Money  for  industrial  companies  is  being  obtaineil  again 
in  the  London  market  by  Canadian  financiers.  The  Dominion 
Government's  excellent  credit  standing  will  serve  her  in  good 
stead  whenever  the  stars  are  propitious  for  the  commence- 
ment of  another  Canadian  governmental  borrowing  era  in 
London,  the  world's  money  market. 


January  6,  1922. 


THE      MONETARY      TIMES 


New  Companies  Incorporated  in  1921 

Total  for  First  Eleven  Months  Represents  Authorized  Capital 
of  $778,173,149 — Only  Six  With  Capital  of  Ten  Millions 
Or     Over,     Against     Twenty     in     Same    Period     Last     Year 


AUTHOUTZED  capital  of  |778,17:i,149  is  roprp.scnted 
by  now  companies  incorporated  In  the  llr«t  olovon 
months  of  1921,  according  to  The  Monetary  Times'  esti- 
mate. Companies  with  Dominion  charters  constitute 
$335,854,650,  or  about  45  per  cent  of  the  total.  Ontario 
claims  about  30  per  cent. 

The  following  table  gives  the  details  for  the  eleven 
months; — ■ 

Dominion    $335,854,650 

Alberta    17,958,000 

British-  Columbia    74,997,000 

Manitoba    32,942,000 

New    Brunswick    1,135,100 

Ontario    239,700,585 

Prince  Edward  Island 600,000 

Quebec    69,495,499 

Saskatchewan _  .  5.490.500 

Total     $778,173,149 

There  were  only  six  with  a  capital  of  $10,000,000  or 
over,  against  twenty  during  the  first  eleven  months  of 
1920.     The   1921   list  Is  as  follows:  — 

S  uthern  Alberta  Oils,  Ltd.,  Calgary,  $10,000,000: 
Harrison  Lumber  &  Pulp  Co.  Ltd.,  Vancouver,  $16,000,- 
000;  Bathurst  Co.  Ltd..  Bathurst,  $15,000,000;  J.  R.  Booth 
Co..  Ottawa,  $10,000,000;  International  Oilfields  Mining 
&  Refining  Co.  Toronto,  $3,000,000;  Canadian  Inter- 
national Paper  Co.,  Three  Rivers,   $20,000,000, 

Million  Dollar  Companies 

Below  is  given  a  list  of  the  companies  with  capltnl  of 
$1,000,000  and  over,  arranged  by  cities;  — 

AlillKllTA, 

Colflnr.v.— Hoyalltc  Oil  Co.  Ltd.,  $1  ,(X)O.(X)0 :  (.iiiiadliin  (.din  l.ix-ki-i' 
Co.  Lid..  $1,500,000;  Mount-StuSTt  Oil  Co.  Ltd.,  11,250,000;  .eoiithorn 
Alberta   oils.    Ltd..  llO.OOO.oon. 

Eilinnnlnn. — Fort  Norman  Oil  ^  Development  Co.  Ltd..  ♦I.i.io.ooo; 
lle/irf.    Stooker   Co.    Ltd..   12,000.000;    Lusoar   Collieries,    Lid.,   »l.noo.OOO. 

Medicine    Hat.— Alberta    Foundry    and    Machine    Co.    Ltd.,    ll.noo.OOO. 

BRITISH    COLUMniA 

AInswnrlli.   B.C.— Lakesliore   MInlnir   Co.    Ltd..   ».1,000,000. 

Niinnlmn,    B.C.— Western    Fuel    Cmp.    of   Canada,    Ltd.,    $5,000,000. 

New  Weslinlnsler,  B.C.— Abernciliv  Loufrhecd  l.oggrlnfr  Co.  Ltd., 
Jl.ono.nmi. 

Norlli  Vniicouver.— nurrnrd  Dry  Dock  Co.  Ltd.,  11,000.000. 
Vancouver.  B.C.- Harrison  Lumber  4  Pulp  Co.  Ltd.,  $15,000,000;  Prince 
■  Rupert  Pulp  &  Paper  Co.  Ltd.,  .■?i.i)iX1.iX)0;  S.  Saskin  &  Co.  Ltd..  fl.ooo.- 
000;  Albion  Oil  Co.  Ltd..  J3.0()n.0iv) ;  .«heep  Creek  Consolidated  Mines. 
Ltd..  $1,000,000;  Gasse-MIUerd.  Ltd.,  $1,000,000;  P..M.  Oil  Co.  Ltd., 
$1,000,000;  Canadian  Farm  Implement  Co.  Ltd.,  $1,000,000;  M.ilnland  & 
Islfind  Lumber  Co,  Ltd.,  $1.000,i)00;  consolidated  Hnnd  .V  Mortitatre  Co. 
Ltd..  $1,01)0,000;  n.C.  United  Oil  Co.  Ltd.,  $1,000,000;  Consollil.iled  nul- 
lion  Hvrtraullc   Mlnlmr  Co.  $5,000,000. 

Victoria,    B.C.— nitbet    Consolidated,    Ltd.,    $1,500,000. 

MANITOBA 

.The  Pas.  Man.— Prltlsh  Canada  Norlli  Kxploratlon  &  Development 
Co.    Ltd.,    $1,000,000. 

St.    Iloniface.    Man.— International    Tractor    Co,    Ltd.,    $1,000,000. 

Wlnnlpcfl.  Mnn.- Chllds  Co.  of  Manitoba.  Ltd.,  $1,000,000;  Prairie 
Cold  Sloraire  Corp.  Ltd.,  $2,000,000;  Parker  Motor  Car  Co.  Ltd.,  $10.- 
00fi,000;  Mutual  Supply,  Ltd.,  $1,000,000;  Northwestern  Construction 
Co.,  $1,000,000;  Point  du  Poise  MInlnir  k  Development  Co.,  $1,000,000; 
I'nlon  Liberty  Co.  Ltd..  $1,000,000;  Western  Packers.  Ltd,.  $1,000,000; 
Mutual  Oils  Consolidated.  Ltd..  $3,000,000;  Canadian  MInlnir  fc  Leaslnit 
Corp.    Ltd..  $.-i.O0O.0O0. 

NRW    BRINSWICK 

RathiiP'i.   \.B.— Bathurst   Co.    Ltd.,   $15,000,000. 

ONTARIO 

\\lnicr.    Onl.— Oranjre   Crush    Pottlers.    Ltd.,   $S,OOO.0Otl. 
BnivmiinvlllP.Ohl.— Feldspar    Class,    Ltd..    $1,000,000. 
BrnnUnrd.    Onl.— Dominion    Steel    Products   Co.    Ltd..   $3,000,000. 
Cnlhnll.    Onl.— I.ehel    Lode    Ltd..   $2,000,000. 
niinnvllle.    Onl.— Universal    Casket   Co.    Ltd..   $9,000,000, 
Essc\.    Onl.— Ksscx    Truck    &    Tractor   Co.    Ltd..   $1,000,000. 
Ilamlllnn.  Ont.— F.  W.   Fearman  Co.   Ltd..  $1,000,000;  Star  Seciirllles. 
Ltd.,   $1,000,000.    Peninsular   Cord   Tire   &    Rubber   Co.    Ltd..   $l.ooo.0OO; 


Hamilton  Product!*,  Ltd.,  $1,500,000;  W«lter  WoodJ,  Ltd.,  $I.JSO.aaO; 
llaiulliou  Flnaijc'c  Corp.  Ltd.,  $1,000,000;  Heaver  Truck  Corp.  Ltd., 
$l,r.oo,i)(X);    Eaifli-   Securities,    Ltd.,   $3,000,000. 

Kllehener.  Oot.— DurnarU  Packing  Co.  Ltd..  $1,000,000:  KltdMDsr 
Finance  Corp.  Ltd..  $1,000,000;  Silu  &  Cbemlcali,  Ltd..  mjmjm^ 
Queen  Label   Cold    Mines.    Ltd.  $2,000,000. 

Leaminiiliin,   Ont.— luaiiiond    Tobacco   Co.    Ltd..  tiJOOOfiOi. 

Leaslde    (Int.— Iiurani    Motor    Co.   of   Canada.    Ltd.,   $3,000,000. 

Little   trrrrrenl.  Ont.— La   Cloche   IslanrI    Co  '1O.OOO. 

London    Onl.— London    .Motors,    Ltd.,    11,0"  rwooifl    LUL. 

$1,000,1100;   Car  Owners'   Carafe   Co..   $l,r»io,ou'i  I'lnanco  Corn. 

Ltd..    $1.0110,000;    Producers    Terminal    Co.    Ltd.,    H.iMiMI. 

Ilrllllla,  Ont.— Scbmick  Oear  k  Screw  Co.  of  Canada,  Ltd..  $1,000.0011 

Ollauu,    Onl.— J,    it.    lloolb    Co.,    $10,000,000;    Mew    rtorUlweil    Corp. 
Ltd.,  $c,.775.0OO;  Edwards  Lumber  k  Pulp  Ltd.,  $2,000,000;  A.  J.  ~ 
Ltd..   $1,500,000. 

Paris.  Ont.— nishop— Hianey   Corp.    Ltd      •:,  opoono 

Pembroke,  Onl.— Canadian   .Match   Co  •  ,000. 

Petrrboro.    Ont.— Central   Ontario   OH  :  ,   $1,000,000. 

Preston,   Ont.— Cieo.    ['attlnson   and   Co.    ..  .^,  rvio 

Sarnla.  Ont.— Sarnia   Finance  Con>.   Ltd.,  (i 

Shelhiirnr.   Onl.— <:hamberlaln   Coal   k  Oil    1 
non. 

Toronto.  KnI.-  Tiirnbiill   Elevator  Co.   Ltd..  $l,ni«' 
Lean    Ltd.,    $1,000,000;    Scotia    Tradlnr    Cnrp     Ltd      ' 
Vlllx    Feed   i    MIIIP-.-    '•      •••      ♦•--•"'•"     f.  , 
Corp,     Ltd..     $1.00(1 
Filter    Co.    Ltd.,    .* 
Norman   Oil   Co.    I 

Ltd..    $2.000.(K10;    Per 

Ltd..   $1,000,000:    \V., 
Rubber  Corp.  Ltd..   'i.' 
000;    Turn-0-Stop   Maniil 
Ltd.,    $3,000,000;    Jack     li 

Metal    Auto    Wheel    Co..    ?l.'"«i.7'">,    llir;.-iif; 
National    Co-operairc    Co.    Ltd..    .'Lixxxidd      ii 
Belt   Co.   Ltd..  $5,000,000;    Renecto    I  l(rht   Co     I  1  : 
k   Co.    Ltd..  $1,000.00(1;    E    A   S,    Currle.    Ltd..  «l.w» 
missions,   Ltd.,  $1,000,000;  Tavlnr  Rubber  Co.    Ltd.,    ■ 
Automatic    Barrel    Machlnerv    Co.    Ltd.    $I.Ofl0.nnn 
Ltd.,    $l,(VX).0OO;    Hls-hwav    Llirhthouse    Co.    Ltd..    $1 
Truck   Corp.    of   Canada.   $1,500,000;    United   Clirar   ^ 
000:    Miller    Florists,    Ltd..    $1,000,000;    Sumbllnit    M.i  ... 
$1,000,000:    Baltic    Tradlntr   Co.    LuL.    $1,000,000     Toronto 
Ltd..    $2,000,000;     Dominion    Finance    Ouarantv    Cortv     I 
Canadian    Securities    A    Land    Corp.    Ltd      •■i.^iw,     i. 
Corp.     Ltd.,    $1,000,000;     Northrop    Stron- 
Adanac  Mortjtaire   Investments   Ltd..  «l  r^ 


It    Cn     •f.OOO,- 

IC- 

'lan 

>nd 

on 

<M. 

r>. 

L. 

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Co. 

Tnp 


1  r*iN- 
anadlan 

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.1.1     Mill. 
Porcupln. 


« 1(100.000;    Siseklnlka     Divide    Mine- 

or    Porcupine.    Ltd..    $2.000,onO:    Mn 

Allied    Porcupine   Cold    Mines,    ltd 

Ltd.,    $2,500,000:    West-Beaumont    (.111 

Mines.     Ltd..     $l.ooo.onO:     Comfort     Kirk' 

Ahrams   West    Columbia   Oil    Co     Ltd      ; 

Ltd..    $3,000,000;    Two-In-One    Cold    ■• 

Cornoratlon    of    Fort    Norman.    Ltd 

Ciold  MlnlUR  Co    Ltd..  $1,000,000- 

$1,000,000;    British   Canadian    !■■ 

enplne  Cold   MInlnir  Co    Ltd 

*    Rennlnjr    Co     $3,000,000     v 

Mines     Ltd..    $5.non.oo0:    - 

000;    Holtvrex    Cold    Mln 

Ltd..   ni.oon.OflO;    KIrklan.l 

Ltd..    $!>.0fln.00O:    pennlnsiiUr     ■ 

Cold    Mines.    ltd..    $3.nonnnO: 

$1,000,000:    North  Trail   Cold   Mln<^.   Ltd 

ltd..    Sf.Wl.OOO;    SI.     Vnthonv    (loi.l    Mine*,    lid.     ' 

Mines.   I  trt  .   nj.onn.nno;    Biimand   Cold   Mln««s.   LM..    ■ 

Windsor,    Ont.— New    Windsor    Hole]    Co.    Lid..    I:  .■ 
Motors.    Ltd..    $1,000,000;    Modern    Builders.    Ltd..  t1.oni».i*> 

QI'KBET 

nrnmmonrivillr.   Que.- Dominion  Sllli  Dvelna  *    FlnKtilnr  ■ 

$l.oon,nno. 

Monlrral.  Cue.— Milk  Products  Co.  Ltd.,  $1,000,000;   Acer  Inv 
Ltd..    $2,000,000:    Partners    Investment   Co.    Ltd.    t|  nrm  nrp     cr 
bodv   Securities    Corji.    Ltd..   $1,000,000:    I.    H     ' 
N.   A.   Tlmmins.   Inc.  $5,000,000;   Pembroke  I  iin 
Cosirrove    Fxoort    Brewery    Co..    ft  i"^'^-'' ''•'•"i 
of  Canada  I  td..  *-:>.niv\,r\nn-  E.  C.  M    ■ 
Co.   Inc..  $1,500,000    Holland  VamI-' 
Mllllni  .V   Manufncmrln»  Co    I  1.1 
ln#  Corn.    Ltd..    «|.flno,flno:    Bi: 
000;    Bed    Star    neflnerles.    II  ■ 
000,000:     Rel^an     Industrial     ' 
Corn,    iid  .   $i.nnn.nno:    Montr.- 
Rallw,iy    Fmiloments,    Ltd..    «' 
Co.    I  trt..   $1,000,000-   Dupu'--    '  • 
Inerv    A-    Siinnlv    Co.    t  ■ 
$1,000,000:    Mnlvhrtenlte    ' 
I  trt  .    $1,000,000      t  ake    r.ir..,,, 

ft    Transport.    T  trt      Monn.onn 

nmnir  Co.    T  trt..   to  000  000-     c. 

Moses    VIneberir    Investment    i  nrr'     'i.:^» 

Oiiehee.    One.— F<i»      Jullen    ft    Co.    I  '  ■«;     ?l.     I 

lumber   Co    T  trt  .   $1,000,000;     Clarke     9i.  s-    ■  1     t.M       • 

Wetister    rinanclil   Corn.    ltd..   $1  oon.nfto. 

Three    River*.    0"e — Canadian    Intematlotial    VUftT    C' 
nerent    Sernri"'-"     '  •■'      •iivmnno 


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106 


THE      MONETARY      TIMES 


Volume  68. 


Canada's  Relations  With  United  States 

Features  of  Past  Year  Have  Been  Decrease  in  Volume  of  Trade, 
United  States  Emergency  Tsu-iff,  Sale  of  Scurities  There,  and  Partial 
Recovery  in  the  Exchange  Situation — Trade  Figures  are  Misleading 


BY    A.    G.    SCIiATER. 


MARKED  progresa  has  been  made  during  the  past 
year  in  the  direction  of  restoring  to  a  condition 
closer  to  what  may  perhaps  be  considered  normal,  the 
fundamental  factors  which  govern  the  commercial  and 
financial  relations  of  the  United  States  and  Canada.  While 
many  obstacles  still  prevent  the  restoration-  ot  that  degree 
of  commercial  intercourse  to  which  American  and  Cana- 
dian business  had  become  accustomed  prior  to  1914,  suffi- 
cient progress  has  been  made  during  the  past  six  months 
to  warrant  the  belief  that  further  gradual  improvement 
is  likely  to  occur  during  the  year  1922. 

Features  of  the  Year 

The  salient  features  of  the  history  of  trade  and  financial 
relations  between  Canada  and  the  United  States  during 
the  past  twelve   months   may   be   summarized   as  follows: 

(1)  Marked  decrease  In  the  total  volume  of  Cana- 
dian-American trade  as  a  whole.  This  decrease  affected 
Tjoth  American  exports  and  Imports  alike,  although  the 
decrease  was  more  marked  in  the  case  of  the  former  than 
of  the  latter.  The  general  effect  of  this  decrease  in  exports 
bas  beenj  a'  dlistlnct  decrease  in  the  adverse  trade  balance  of 
Canada  in  the  United  States.  This  fact  has  had  its  effect 
on  the  status  of  the  Canadian  dollar  in  the  United  States 
and  has  of  course  played  an  important  part  in  fortifying 
Canada's  general  position  In  the  field  of  foreign  trade. 

(2)  The  enactment  of  a  special  piece  of  tariff  legis- 
lation by  the  United  States,  imposing  heavy  duties  on 
Imports  of  food  products.  This  piece  of  class  legislation, 
ostensibly  enacted  to  protect  the  American  farmer  against 
foreign  competition,  was  put  into  effect  on  June  1,  and 
resulted  liuring  the  closing  six  months  of  the  year  in  a 
very  marked  curtailment  of  Canada's*  exports  of  cattle 
and  foodstuffs  to  the  United  States.  But  while  considered 
en  masse  Canadian  exports  of  foodstuffs  to  the  United 
States  were  curtailed  by  this  Emergency  Tariff  Act,  in 
spite  of  the  fact  that  it  imposed  beavy  duties  on  both 
Canadian  wheat  and  Canadian  flour,  it  did  not  prevent  a 
heavy  increase  in  Canadian  wheat  exports  to  the  United 
States  and  the  continuance  of  sufficient  trade  in  flour 
to  impel  American  millers  to  demand  further  protection 
Irom   Congress. 

(3)  The  sale  of  an  unusually  large  volume  of  Can- 
adian bonds  in  the  United  States.  Almost  simultaneously 
there  occurred  an  equally  unusual  degree  of  investment  in 
Canadian   internal   bonds  by  American   investors. 

(4)  Partly  due  to  the  improvement  in  the  Canadian 
trade  balance  in  the  United  States,  partly  to  the  large 
investment  in  Canadian  securities  which  occurred  during 
the  closing  six  months  of  the  year  a  marked  improvement 
occurred  in  the  status  of  the  Canadian  dollar  in  the  United 
States.  At  the  close  ot  the  year  the  discount  on  the  Can- 
adian dollar  in  the  United  States  was  considerably  smaller 
than  it  was  at  the  close  of  the  previous  year.  Not  only 
was  this  the  case,  but  the  Canadian  exchange  market 
during  the  greater  part  of  the  year  was  in  a  more  stable 
condition  than  it  had  been  in  1920. 

Decrease  In  Trade 

The  decrease  which  occurred  in  the  volume  of  Can- 
adian-American trade  during  the  year,  while  partly  the 
result  of  the  discount  on  the  Canadian  dollar  in  the 
United  States,  and  partly  the  result  of  the  special  measures 
taken  by  the  late  Dominion  Government  to  restrict  import- 
ations from  the  United  States,  was  largely  the  result  of 
the  industrial  depression,  affecting  both  city  and  country 
alike,  which  held  both  countries  in  Its  grip  for  the  greater 


part  ot  the  year  1921.  Then  most  American  exporters  to 
Canada  found  that  the  Made-in-Canada  movement  was 
a  more  important  factor  in  1921  than  it  was  in  1920. 
Patriotism  and  self-interest  they  found  alike  induced  a 
larger  number  of  Canadian  importers  to  refuse  to  buy 
in  the  United  States. 

Yet  in  spite  of  the  difficulties  which  faced  the  Ameri- 
can exporter  to  Canada,  American  exports  held  their  own 
surprisingly  well.  While  physically  and  in  terms  of 
dollars  and  cents,  they  were  smaller  than  in  1920,  when 
allowance  is  made  for  the  very  marked  price  declines 
which  occurred  during  the  year,  the  total  exports  to 
Canada  from  the  United  States  compared  favora,bly  with 
former  years  and  were  in  fact  much  larger  than  in  pre- 
war days.  The  decrease  which  did  occur  affected  virtu- 
ally every  product  which  Canadians  are  in  the  habit  of 
buying  in  the  United  States.  Corn  was  one  American  pro- 
duct which  proved  an  exception.  During  the  ten  months 
ending  October  the  United  States  exports  ot  corn  to  Canada 
were  much  larger  both  in  volume  and  in  value  than  they 
were  during  the  same  ten  months  of  1920. 

Figures  Misleading 

But  the  unreliability  of  any  conclusions  regarding  the 
volume  of  American  exports  to  Canada  based  upon  a  mere 
comparison  of  the  statistics  for  1920  and  1921  found  in 
the  Government  bluebooks,  may  be  seen  from  the  following 
analysis  of  the  United  States  exports  to  Canada  during 
the  twelve  months  ending  August  1920  and  August  1921. 
During  the  twelve  months  ending  August  31,  1921,  the 
United  States  exported  to  Canada  goods  valued  at  some 
$220,000,000  less  than  it  did  during  the  same  .twelve 
months  of  the  previous  year.  A  comparison  of  the  imports 
totals  for  these  same  two  periods  reveals  the  fact  that  a 
drop  of  some  $50,000,000  also  occurred  in  imports.  But 
if  the  price  decline  which  affected  both  exports  and  imports 
during  the  intervening  months  is  taken  into  consideration, 
the  decline  in  both  cases  seems  less  serious. 

Index  numbers  based  upon  the  average  price  of  twenty- 
four  of  the  principal  commodities  imported  by  Canada 
during  the  five-year  period  ending  1913,  indicate  that 
Import  prices  dropped  most  emphatically  in  the  twelve 
months  period  between  August  31,  1920,  and  August  31, 
1921.  On  the  first  of  September,  1920  the  import  price 
index  was  253.68;  in  September  of  this  year  it  was  147.92. 
An  almost  equally  heavy  drop  occurred  in  export  prices. 
In  Septeml)er,  1920,,  for  instance,  the  export  price  index 
number  was  246.53.  This  year  it  was  159.26.  The  price 
drop  in  the  case  of  Canadian  imports  was  thus  approxi- 
mately 41  per  cent,  and  in  the  case  of  exports  about  34 
per  cent. 

If  allowance  is  made  for  these  price  changes,  it  will 
be  found  that  while  apparently  both  imports  and  exports 
are  much  smaller  than  they  were  in  1920.  actually  the 
decline  has  not  been  so  great  as  the  statistics  given  in  the 
Government  publications  of  both  Canada  and  the  United 
States  would  indicate.  Not  only  this,  i  but  after  making 
proper  allowances  for  differences  ot  price,  we  compare  the 
statistics  for  1921  with  pre-war  totals  we  shall  find  that 
the  actual  volume  of  Canada's  trade  with  the  United  Spates 
is  much  greater  than  it  was  prior  to  1914. 

Tlie   Emergency   Tariff 

After  the  amount  of  publicity  which  has  been  given  to 
the  American  Emergency  Tariff  in  Canada  it  seems 
hardly  necessary  to  discuss  either  the  political  policy 
which  gave  it  birth  or  the  effect  it  has  had  on  the  market 
for   Canadian   cattle  and   foodstuffs  in   the   United   States. 


January   6,   1922.  THBMONETARY      TIMES  '  107 


The  National  City  Company 


is  a  corporation  engaged  in  the  purchase  and  sale  of 
bonds  and  other  high  class  securities.    Its  interests  are 
closely  allied  with  the  National  City  Bank  of  New  York. 
The  service  extended  to  the  investor  of  small  amounts  is 
the  same  as  received  by  the  investor  of  large  amounts. 

We  welcome  inquiries  on  all  investment  matters. 


•      CANADIAN  ADVISORY  BOARD 

Rt.  Hon.  Lord  Shaughnessy,  K.C.V.O.,  Chairman 

Sir  John  Aird  Hon.  Sir  Lomer  Gouin,  K.C.M.G. 

Edson  L.  Pease  Sir  Aupustu.s  Nanton 

Martial  Chevalier  W.  N.  Tilley,  K.C. 

Lt.  Col.  Herbert  Molson,  C.M.G.,  M.C. 


The  National  City  Company 

L<i])ilt<>d 

Canadian  Head  Office 
74  Notre  Dame  Street  West,  Montreal 

10  KiiiK  street  East  Mc-Curdy   Balldiii«, 

Toronto,  Ont.  Halifax,  N.8. 


108 


THE      MONETARY      TIMES 


VcJlume  68. 


Suffice  it  is  to  say,  even  after  allowing  for  the  fifty  per 
cent  decrease  which  occurred  in  Canadian  export  prices 
during  the  past  twelve  months,  Canada'  exports  of  the 
products  affected  by  the  Emergency  Tariff  were  almost 
fifty  per  cent  less  in  the  five  months  ending  October  31, 
1921,  than  they  were  in  the  same  five  months  of  1920. 
The  only  thing  which  prevented  the  decrease  being  even 
greater  was  the  fact  that  during  the  first  tour  months  of 
the  period  of  1921  under  discussion  wheat  exports  from 
Canada  to  the  United  States  held  up  remarkably  well. 

Canada'  pulp  and  paper  export  trade  with  the  United 
States  has  like  its  foodstuff  trade  been  the  victim  of  un- 
usual conditions.  In  the  course  of  the  year  it  has  in- 
creasingly shown  the  effects  of  overseas  competition,  par- 
ticularly that  of  Germany,  Norway  and  Sweden.  The 
American  imports  of  both  newsprint  and  pulp  from  these 
countries  grew  steadily  during  the  year,  apparently  to 
some  extent  at  least  at  the  expense  of  the  Canadian  pro- 
ducers. This  growth  was  favored  in  the  case  of  Germany 
by  the  low  price  of  the  German  mark  in  the  United  States 
and  the  fact  that  for  at  least  a  part  of  the  year  the  German 
manufacturers  were  in  receipt  of  subsidies  from  their 
Government.  They  were  thus  able  to  lay  newsprint  down 
in  New  York  for  approximately  $20,  a  ton  and  sulphite 
for  about  $14.  a  ton.  The  effect  of  this  kind  of  competi- 
tion combined  with  a  general  curtailment  of  the  use  of 
newsprint  to  affect  materially  the  volume  of  pulp  and 
paper  imports. 

Investment   Situation 

The  larg?  volume  of  American  money  which  found  its 
way  during  the  year  into  Canadian  external  and  internal 
bonds,  should  be  particularly  gratifying  to  Canadians. 
During  the  ten  months  ending  October  31,  1921,  over 
$138, ,000, 000  of  Canadian  bonds  were  sold  in  the  United 
states  at  prices  which  were  in  many  cases  better  than 
could  have  been  obtained  in  Canada.  The  principle 
borrowers  were  the  provincial  governments  and  the 
municipalities. 

While  the  strong  market  which  existed  in  the  closing 
months  of  the  year  for  Canadian  bonds  was  due  to  the 
fact  that  the  Canadian  bond  market  failed  to  keep  pace 
with  the  improvement  which  occurred  in  the  American  . 
market  and  partly  to  the  moral  effect  of  the  very  con- 
siderable rise  which  occurred  in  the  value  of  the  Canadian 
dollar  in  the  United  States  between  January  first  and 
September  first,  the  investment  of  such  large  amounts  of 
American  money  both  here  and  in  Canada  in  gilt  edged 
Canadian  securities  had  of  course  its  effect  on  the  value 
of  the  Canadian  dollar  here  and  the  course  of  the  Can- 
adian exchange  market. 

The  improvement  of  the  Canadian  exchange  market 
was  marked  during  the  year,  particularly  in  September, 
October,  November  and  December.  The  average  rate'  of 
discount  month  by  month  was  considerably  lower  than 
it  was  during  1920.  While  the  discount  in  January  went 
as  high  as  fifteen  per  cent,  it  only  touched  this  level  once. 
In  August,  September,  October,  November  and  December, 
(up  to  the  fifteenth  of  the  month)  the  general  level  of 
the  daily  quotations  was  much  lower  than  it  was  during 
the  same  five  months  of  the  previous  year  in  spite  of  the 
fact  that  apparently  so  far  as  Canadian  exports  of  grain 
were  concerned  conditions  were  much  less  favorable  to 
the  Canadian  dollar  in  the  United  States. 

Exchange   Rates 

The  improvement  that  has  occurred  so  far  as  the  Can- 
adian exchange  market  Is  concerned  may  be  illustrated 
by  comparing  the  discount  on  the  Canadian  dollar  in  De- 
cember 1920  and  that  quoted  in  December  1921.  On 
December  15,  1920  the  Canadian  dollar  was  worth  85.2 
cents  in  New  York  City  according  to  the  records  of  the 
New  York  Times.  On  December  15,  1921,  it  was  worth 
slightly  over   92   cents. 

And  while  speaking  of  the  Canadian  exchange  market, 
mention  should  be  made  of  one  unexpected  result  of  the 
American    exporter's    desire    to   take   advantage    in    every 


way  of  the  discount  on  the  Canadian  dollar  in  the  United 
States.  This  desire  expressed  itself  in  American  shippers 
routing  through  the  port  of  Montreal,  the  greatest  volume 
of  American  corn  and  wheat  which  ever  passed  through 
that  city.  Thus  in  a  way,  in  one  instance  at  least,  the 
exchange  situation  did  not  work  to  the  disadvantage  of 
Canada. 

So  much  for  the  past  year.     What  of  the  future? 

If  ever  the  role  of  the  prophet  were  a  dangerous  one, 
it  is  so  today.  In  this  particular  case,  the  would-be  pro- 
phet is  confronted  not  only  by  the  uncertain  future  of 
international  trade  as  a  whole  but  by  the  fact  that  in 
neither  Canada  nor  in  the  United  States  can  one  state 
with  any  certainty  what  will  be  ultimate  attitude  of  the 
Government  of  the  one  country  toward  the  trade  of  the 
other.  One  is  thus  confronted  by  not  only  the  uncertain- 
ties of  the  business  future  but  by  the  uncertainties  of  the 
political    future   in   two   countries. 

Perhaps  the  best  way  to  pass  safely  the  fog  of  un- 
certainty which  obscures  our  view  of  the  immediate  future 
of  American-Canadian  trade  and  financial  relations,  is  to 
adopt  the  faith  in  the  future  relations  of  the  two  countries 
which  American  investors  have  shown  in  the  past  year 
by  buying   $138,000,000   of  Canadian   bonds. 


CANADA'S  FINANCIAL  POSITION  SUMMAKIZED 


Prominent     Financier     Takes  '  Optimisitic     View     of 
Country'.s  Pi-ospects — European   Nations  in 
Bad  Condition 


This 


A  SUMMARY  of  the  financial  position  of  Canada  at  the 
present  time  was  presented  by  J.  H.  Gundy,  of  Wood, 
Gundy  and  Co.,  Toronto,  in  an  address  in  Toronto  on  Nov. 
2.  Mr.  Gundy  pointed  out  that  those  who  expected  lack 
of  money  to  stop  the  war  were  wrong  in  their  forecasts.  So 
far  as  money  was  concerned,  the  various  contests  might  have 
been  carried  on  much  longer,  had  the  fighting  not  been 
brought  to  an  end  by  the  defeat  of  Germany. 

Money  was  obtained,  he  said,  by  the  inflation  of  national 
cuirenc  ££,  and  though  these  now  rise  in  value  as  deflation 
goes  on,  the  piocess  is  slow  and  protracted  in  proportion  to 
the  inflation.  The  currency  of  the  United  States,  being  on  a 
real  gold  basis,  was  the  only  one  that  did  not  fluctuate. 
German  currency  was  inflated  by  successive  issues  of  paper 
money  skilfully  announced  from  time  to  time.  In  this  way 
great  acquisitions  of  real  vvealth  were  made  by  Hugo  Stinnes 
and  others,  while  the  wages  of  Labor  were  reduced  in  purch- 
asing power  with  each  output  of  currency.  That  remained 
meanwhile  unchanged  in  denomination. 

Inflation  of  currency  was  automatic  under  certain  finan- 
cial conditions,  Mr.  Gundy  said,  and  there  was  still  some  of 
the  war  period  inflation  existing  in  both  Britain  and  Canada. 
One  cure  for  this  was  a  high  rate  of  interest  charged  by  the 
banks,  making  money  too  costly  to  obtain,  and  thus  tending 
to  prevent  exipenditures  that  were  not  industrially  profitable 
and  could  be  deferred  without  inflicting  any  injury.  Borrow- 
ing to  excess  for  unproductive  expenditure  had  the  same 
eflfect  on  economic  conditions  as  the  inflation  of  currency. 

In  conclusion,    Mr.  Gundy  described    Canada's  financial 
position    as   perfectly    pound,    and    as   likely  to  remain  so  if 
certain  precautions  were  observed  in  the  matter  of  expendi- 
ture of  capital.  Mr.  Gundy  based  his  conclusions  on  the  fact 
that  the  national  revenues  for  two  years,  ending  September,  ^_ 
1921,  showed  a  surplus  of  $133,000,000.     For  the  fiscal  year,  ^Hj 
endinp-  September,    1920 — Canada's  big  importing  year — the  ^"' 
.-■urplus   was    $67,000,000,    and   a  surplus  of  $66,000,000  was 
met   in   the   fiscal    vear   just   ended.       Then  again,  said  Mr. 
Gundy,  current  bank  loans  had  decreased  by  nearly  $200,000- 
000,    in   the   past   year,   while  savings  deposits  had  actually  ~^i 
increased  by  $10,000,000.  H 

He  thousrht  that  crop  prospects  occasioned  no  alarm  and   ^■' 
said  the  Dominion  had  a  favorable  tr^de  balance  of  $70,000.- 
000   for  tTie   vear  ending  last   September  as  opposed  to  an 
unfavorable  balance  of  $116,000,000  in  the  previous  year. 


January   6,   1922.  THEM0NRTARYT1ME8                                                                         ITO 
i'llllllllllllltllllllllllllllllllllllllllllllllllllllllllllllllllllllillllllllllllllf    IIIIIIIIIIIIIIIIIIIIIIIIIIIIMIIIIIIIIIIIIMIIIIMIIIIIIIIIIIIIIItlllllllllMMIIIII"^ 

I  Canadian  &  General  Securities  I 

I  Limited  I 

I  INVESTMENT   BANKERS  | 

I  Subscribed  Capital     -     $500,000.00  I 

I  DIRECTORS  I 

I  President                                         Vice-President  | 

=  A.  R.  Davidson                                    J.  C.  McGavin  | 

=  General  Manager  | 

I  W.  W.  Evans  i 

=  R.  T.  Evans                                         Andrew  Kelly  = 

I  Wm.  L.  Ross                                       Col.  J.  Y.  Reid  i 

=  H.  B.  Lyall                                          Major  G.  Harold  Aikins  I 

=  ,    Deal  in  and  purchase  issues  of :  5 

I  Municipal  Bonds,  Bonds  and  Obligations  of  Utilities  and  = 

I  Industrial  Corporations  of  established  value  i 

I  TRUST  &  LOAN  BUILDING,  WINNIPEG  I 


Traders  Finance  Corporation  i 

Limited 

Capital      -      Authorized        Subscribed  j 

Preferred-  $1,500,000.00        $800,000  I 

Common    -  $1,500,000.00     $1,500,000  j 

DIRECTORS  [ 

President                                         Vice-President  = 

A.  B.  Hudson,  K.C.                                J.  C.  McGavin  j 

Managing  Director  \ 

W.  W.  Evans  \ 

R.  T.  Evans                                         Andrew  Kelly  = 

E.  W.  Kneeland                                    R.  R.  Wilson  j 

A.  R.  Davidson  I 

G.  B.  Blair,  Secretary  = 

E.  M.  Strain,  Asst.  Secretary  = 

COMMERCIAL    ACCEPTANCES  [ 

TRUST  &  LOAN  BUILDING,  WINNIPEG  [ 

iiMriiiiiiniiiuiiiiiiMiuiiiiiiiiiiiiiiiiiMiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiniiiiiiiiiiiiiniiiiiiiiiiiiiiMuiiiiiiMiiiiiiiiiiiiiiiiiMiiiMiiiiiiiMiiiiiiitiiiMiiiii: 


110 


THE       MONETARY       TIMES 


Volume  68 


Growth  of  Population  Has  Been  Disappointing 

Census  Returns  Indicate  Increase  Has  Been  Little  More  Than 
Normal^Land  Grants  and  Their  Influence  in  Bringing  New 
Settlers    to    Canada — Significance    to    the    Railways    of    Canada 

BY  ANDREW  T.  DRUMMOND 


NOTWITHSTANDING  the  considerable  number  of  im- 
migrants who  have  entered  Canada  during  the  past 
ten  years,  the  population  appears  from  the  partial  census 
returns  which  have  already  appeared,  to  have  made  only 
a  moderate  advance,  not  very  greatly  exceeding  what 
would  have  been  expected  from  the  ordinary  natural  In- 
crease within  the  country.  There  would  seem  to  be  some 
colour  to  the  claim  of  the  United  States  authorities  that 
many  Canadians  have  continued  to  find  a  better  outlook 
for  their  energies  in,  especially,  Ame^rican  cities.  With 
the  large  expansion  in  manufacturihg  industries  during 
the  past  few  years,  particularly  in  Ontario  and  Quebec, 
the  impression  had  prevailed  here,  that  this  migration  to 
the  United  States  had  been  almost  entirely  stayed,  and 
that  the  added  attractions  of  relatively  cheap  land  in  the 
Canadian  prairie  provinces  had  even  createa  a  reverse 
current   from    Iowa.    Minnesota    and    other   western    states. 

Pre   War   Attitude 

Prior  to  the  war,  a  principle  kindred  to  that  of  free 
trade,  strongly  influenced  the  Government  of  Great  Brit- 
ain in  Its  policy  regarding  emigration  from  that  country. 
The  emigrant  was  allowed  to  exercise  his  own  judgment  as 
to  where  he  should  go.  No  direct  co-operation  existed 
with  the  Colonial  Governments,  under  which  in  an  effort 
to  build  up  the  Empire,  the  annual  overflow  in  population 
was  financially  assisted,  or  even  merely  directed,  by  the 
state  to  the  Dominions  and  Colonies.  In  1886,  the  subject 
of  aiding  the  unemployed,  then  numerous  in  England,  to 
settle  in  the  Colonies,  was  discussed  at  Downing  Street, 
Westminster,  between,  on  the  one  hand.  Lord  Granville 
and  the  Local  Government  Board,  and  on  the  other,  a 
very  influential  association  of  peers,  bankers,  members 
of  Parliament  and  others,  under  the  Chairmanship  of 
Lord  Brabazon,  but  the  proposals  made  by  the  Association 
did  not  meet  with  a  favourable  response  from  the  Gov- 
ernment, and  eventually  had  to  be  abandoned. 

Thus,  emigrants  from  the  British  Isles  continued  to 
go  chiefly  to  the  United  States,  under  the  inducements 
which  railway  organizations  there  were  eager  to  offer.  It 
was  not  until  1916,  when  the  need  of  men  and  munitions 
for  the  war  was  being  sorely  felt,  that  the  mistake  was 
forcibly  brought  home  to  the  British  Government.  It  was 
then  that  the  writer  pointed  out  to  Mr.  Bonar  Law,  the 
Secretary  of  State  for  the  Colonies,  that  if  the  action  de- 
sired by  the  Association  had  been  taken  by  the  Govern- 
ment, and  been  continued  through  subsequent  years,  un- 
der which  British  emigration  would  have  been  directed 
to  the  Dominions  and  Colonies,  Instead  of  being  allowed 
to  go  to  the  United  States,  there  to  build  up  a  great  re- 
public, Canada  alone  would  have  been  able  to  contribute 
twice  the  number  of  men  and  twice  the  amount  of  money 
and  munitions  in  support  of  the  Allies  in  the  war.  The 
response  on  behalf  of  the  British  Government  was  almost 
immediate.  Such  a  mistake,  Mr.  Bonar  Law  shortly  after- 
wards announced  at  a  great  public  dinner  in  London, 
would  never  occur  again.  The  subject  was  also  brought 
by  the  writer  before  the  Premiers  of  Canada,  Australia, 
South  Africa  and  New  Zealand,  with  the  result  that  at 
the  next  two  Imperial  Conferences  in  London,  a  fixed 
policy  was  adopted  and  is  now  in  operation,  and  depends 
for  its  success  on  the  active  financial  co-operation  of  the 
different  Dominions  and  Colonials  Governments  with  the 
Home  authorities,  and  especially  on  the  character  of  the 
land  policy  which  these  overseas  governments  adopt.  How 
far  is  Canada  now  co-operating? 


British  Settlers  Preferred 

The  Canadian  Government,  in  view  of  the  immense 
areas  of  land  available  for  settlement  in  the  prairie  prov- 
inces, has  always  shown  a  preference  for  tho?e  British  im- 
migrants who  desired  to  take  up  land,  and  especially 
those  with  agricultural  experience.  More  recently,  how- 
ever, it  has  imposed  barriers  in  the  way  of  all  other  im- 
migrants by,  among  other  requirements,  compelling  them 
to  prove  their  possession  of  a  given  sum  of  money  before 
they  would  be  permitted  to  land.  Is  this  altogether  wise? 
Canada,  it  is  true,  does  not  want  any  immigrants  who 
would  only  afterwards  become  a  burden  on  the  country, 
but  it  does  want  men  blessed  with  strong  physique,  brains, 
and  the  will  to  work,  whether  they  have  the  requisite 
money  or  not.  Very  many  of  the  men  who,  in  the  past  as 
well  as  now,  in  Canada,  have  risen  to  positions  of  great 
influence  and  have  contributed  much  to  the  progress  of  the 
country,  can  look  back  to  the  time  when,  with  few  pos- 
sessions beyond  courage  and  the  determination  to  succeed, 
they  left  the  old  home  land  in  Britain  tor  the  new  sphere 
with,  as  they  believed,  its  fewer  restrictions  and  its  wider 
opportunities  for  each  individual  to  carve  a  place  and  a 
name  for  himself.  To  establish  barriers  to  the  coming  of 
men  of  that  class  would  be  a  serious  mistake.  Already, 
it  is  stated,  that  this  reslJrictive  policy  and  lack  of  en- 
couragement are  changing  to  Australia  the  direction  of 
the  current  which,  in  emigration,  has  so  long  flowed  from 
England  and   Scotland  to  this  country. 

Hailvvay  Iiands 
But  the  Inducements  In  free  land  grants  which  are  offered  to 
Immigrants  from  Europe  also  need  investigation.  In  formulat- 
ing its  land  policy,  after  the  acquirement  of  what  was  pre- 
viously known  as  the  Hudson  Bay  Territory,  and  the  subse- 
quent determination  to  construct  the  Canadian  Pacific  Railway, 
the  Canadian  Government  overlooked  some  most  Important 
considerations,  which  are  now  producing  very  untoward  ef- 
fects in  the  prairie  provinces  on  the  location  and  traffic 
of  the  railways  there,  on  the  business  of  the  merchants 
in  the  hundreds  of  small  towns  which  have  sprung  up 
along  these  railways,  and  on  the  conveniences  and  social 
conditions  of  the  settlers.  Following  the  policy  adopted 
in  the  neighbouring  states  of  Minnesota  and  the  Dakotas, 
the  land  was  surveyed  into  townships  of  six  miles  square, 
which  were  again  subdivided  into  sections  of  640  acres 
and  quarter  sections  of  160  acres.  Free  grants  of  160 
acres,  among  the  odd  numbered  sections,  were  then  of- 
fered to  settlers  without  any  restrictions  as  to  the  dis- 
tricts, near  or  far  away  from  railways,  in  which  they  might 
choose  them,  and  without  any  thought  as  to  whether  one 
settler  out  of  twenty  could  cultivate  even  one  half  of  his 
free  grant,  especially  in  view  of  the  scarcity  of  labour. 
As  the  even  numbered  sections  were  reserved  for  sale,  or 
were  given  as  subsidy  to  the  railways,  the  result  was  that 
the  settlers  distributed  themselves,  not  in  compact  groups, 
close  to  existing  or  surveyed  railways,  but  all  over  these 
three  extensive  provinces,  often  at  great  distances  from 
each  other,  and  without  any  organized  system  on  the  part 
of  the  Government  as  to  market,  supplies,  education  or 
social  conditions,  whilst  the  railways  were  handicapped 
by  having  near  them  only  thinly  settled  districts  from 
which  to  draw  traflic. 

Even  if  each  of  the  four  160  acres  in  a  section  was 
taken  up  by  a  separate  settler — which  was  rarely  the 
case —  these  settlers  would  be  half  a  mile  away  from  each 
other,  and  with   odd  numbered  sections   on   each   side  of 


January   6,   1922. 


THE       MONETARY        TIMES 


111 


LMIIIIIIIIIItllilllllllllllllllllllllllllllllllllllllllllllllllllllllllllllllilllllllllllllllllMIIIIIIIIIIIIIIIIMIIIIIIIIIMIIIMHMIHIIMMIMIIMIIIIIIIIIIIIMMIIIIIIC 


To 


BOND  DEALERS 
BANKS  AND 
TRUST  COMPANIES 


We  want  offerings  of  British 
Columbia  Municipal  Bonds. 

We  will  pay  the  highest 
marJ^et  prices  and  execute  all 
transactions   promptly. 


P ember  ton  &  Son 


=  ESTABLISHED  1887  S 

I  418  Howe  Street  | 

5  Pacific    Building  E 

I  Vancouver,  Canada  | 

TJiiiiiiiiiiiMiiiiiiMiiiiiiiiiiiiiiiiiiiiiniiiiiiMiiiiiiiiiiiiiiiMMnniiiiiiiiniiiiniiiiiiiiiiiiiiiiiiiiiiiMMMiiiuiiiiiiiiiiiiiiiiiiiuiiiiiiiniiiiiiuiiinn 


Quebec 
Bonds 


Our  firm  has  specialized  in  Government, 
Municipal  and  School  bonds,  particulai'- 
ly  in  Province  of  Quebec  issues. 


Enquiries  and  offerings  invited 


RENE-T.  LECLERC 

INVESTMEfTT  BANKER 

MONTREAL  QUEBEC 

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(Established  1901) 


'Wiiuii«Hiiiiwu»iiiuiiiii;iiiiiii»iiiiii(i»<i.i!iii.K>rui., .iiii,iiiiiiiiiiwiiii»iiWiiii»a»jitJ-.i«^w» ^ -^  i:  t.^  i 


If  In  Doubt 


reiianlliii;  thi'  stantlinK  of  inveHtnienl 
Imnkors,       who       Hiilirlt       your       biisiii««» 

TAKE    A   LOOK 

at  the  adrertlxouients  in  this  i-vsiie.  They 
rt'prtvfcnt  the  conservatlTe  element  in  the 
investment  Held — the  llmis  it  i»  safe  for 
.vou  to  <Ii>  biiKinetui  with. 


The  Monetary  Times 

OF  CANADA 
T  WINNIPEG 


112 


THE       MONETARY       TIMES 


Volume  68. 


them,  would  be  at  least  one  and  a  half  miles  from  the 
nearest  settler  in  the  next  odd  numbered  section,  if  that 
happened  to  be  talien  up.  Thus,  when  a  railway  was  con- 
structed within  any  reasonable  distance,  and  a  town  with 
its  railway  station  established,  the  number  of  settlers 
tributary  to  that  town  would  be,  necessarily,  very  small, 
the  business  of  its  merchants,  in  consequence,  restricted, 
and  the  shipments  of  grain  greatly  limited  below  what 
they  should  be,  considering  the  large  area  of  fertile  land 
surrounding  the  town.  Added  to  this,  most  of  the  settlers 
themselves  would  have  the  discomforts  of  being  distant 
from  the  elevators  and  stores,  from  the  post  office,  from 
educational  advantages,  and  from  their  friends.  In  the 
course  of  time,  many  of  the  even  numbered  sections  would 
gradually  find  purchasers,  but  the  large  acreage  with  one 
settler  to  cultivate  it  would  remain  in  that  case  also. 

Iiack  Of  Foresight  Shown 

This  undoubted  lack  of  foresight  in  connection  with 
settlers  in  the  northwest  provinces,  was  immensely  aggrav- 
ated by  the  ambition  of  the  promoters  of  the  Canadian 
Northern  and  Grand  Trunk  Pacific  Railways,  encouraged 
financially  by  the  Government,  to  construct  independent 
lines  across  the  continent,  each  with  various  branch  lines  as 
feeders,  the  whole  leading  to  the  establishment  by  them  of 
some  hundreds  of  small  towns  along  these  railway  lines, 
in  the  hope  or  belief  that  an  influx  of  population  in  and 
around  these  towns  woud  justify  this.  In  nearly  every 
case,  the  influx  was  disappointing.  Thus,  the  progress  of 
these  hundreds  of  small  towns  has  been  crippled,  whilst  the 
railways  are  seriously  suffering  not  only  from  undue  ex- 
tensions of  their  lines,  but  from  the  diffusion  over  vast 
areas  of  a  limited  population. 

When  adopting  a  land  policy  in  the  earlier  days  of  Man- 
itoba, the  outlook  at  the  time  appears  alone  to  have  been 
considered.  Future  results  arising  from  the  then  methods 
did  not  enter  into  the  question,  so  long  as  population  was 
secured.  And  these  methods,  commenced  in  Manitoba, 
were  afterwards  continued  in  Saskatchewan  and  Alberta. 
It  may  be  argued  tliat  in  the  competition  for  immigrants, 
it  was  necessary  to  offer  in  Manitoba  inducements  as  great 
as  prevailed  in  the  neighboring  American  states.  So  long 
as  land  was  available  in  these  states,  and  It  was  then 
yearly  diminishing,  this,  in  the  cases  of  some  settlers  was 
true,  but  not  with  the  majority  of  those  who  at  the  time 
were  coming  to  Manitoba  from  Ontario  and  the  British 
Isles  to  take  up  free  grants.  Their  purpose  was  to  remain 
within  the  Empire.  As  a  matter  of  fact,  however,  before 
Manitoba  was  even  well  settled,  a  reverse  current  com- 
menced through  immigrants  coming  from  the  United 
States  to  Saskatchewan  with,  generally,  the  object,  not  so 
much  of  seeking  free  grants,  as  of  buying  land  in  favour- 
able localities. 

Control    of   Settlement 

The  true  course  should  then  have  been — and,  with  the 
remaining  free  grants,  should  now  be  carried  out — to  limit 
these  free  grants  to  eighty  acres,  and  to  organize  a  method 
of  concentration  of  the  incoming  population,  intsead  of 
allowing  the  yearly  influx  to  distribute  itself  at  its  will  over 
widely  separated  districts.  The  smaller  free  grant  wbuTd 
have  been,  in  the  past,  quite  attractive  to  the  settler  from 
Ontario,  and  very  much  so  to  the  immigrant  from  Great 
Britain,  and  was  as  large  as  either  could  properly  manage. 
Under  any  circumstances,  the  man  who  had  capital  and  iS- 
cilities  for  handling  a  larger  acreage,  had  always  in  these 
earlier  days,  and  often  now,  the  opportunity  to  buy  further 
land  alongside  of  him  at  very  moderate  prices.  As  the 
facts  proved  in  experience,  the  settler  not  infrequently  be- 
came a  mere  land  speculator.  He  built  his  shack,  broke 
and  grew  crops  on  five  to  ten  acres,  and  at  the  end  of  the 
three  years,  obtained  his  patent,  sold  his  free  grant,  and 
migrated  to  another  district  to  renew  the  same  method. 
The  larger  area  of  160  acres  also  led  to  slip-shod  farming, 
which  continues  everywhere  to  this  day  in  the  effort  in 
bring  into  crop  as  many  acres  as  possible.  Simply  scatter- 
ing the  seed  on  the  stubble  land  of  the  previous  year  and 
harrowing   it    in,    is   understood    to    be   a    frequent    course. 


whilst  fertilizers  of  any  kind  to  recompense  the  soil  when 
exhautsed  by  successive  crops,  are  largely  unknown.  Can 
we  wonder  at  the  wheat  production  of  Manitoba  averaging 
only  15  to  16  bushels  to  the  acre,  when  48  to  50  bushels 
are  obtainable  from  properly  cultivated  virgin  land?  And 
38  bushels  of  wheat  to  the  acre  form  the  average  for  ten 
years  past  on  the  long-cultivated  fields  of  Scotland. 

Concentration 

The  policy  of  concentration  of  the  population  through- 
out these  vast  provinces  should  have  been  adopted  from 
the  start.  Had  each  district  along  the  lines  of  railway  had 
its  land  fairly  well  taken  up  before  new  districts  were 
opened  for  settlement,  and  had  the  railways  been  curbed 
instead  of  encouraged,  as  they  were,  by  guarantees  and 
subsidies,  in  making  extensions  everywhere  Into  new  sec- 
tions of  the  country,  it  would  have  been  vastly  better  for 
all  parties,  and  especially  for  the  Dominion  Government 
itself,  for  it  would  not  have  now  the  enormous  railway  bur- 
den which  weighs  so  heavily  upon  it.  Five  years  ago,  the 
subject  was  brought  by  the  writer  before  the  Government, 
but,  while  receiving  some  consideration  has  not  yet  been 
acted  on.  It  is  not  too  late,  in  the  case  of  the  large  re- 
maining areas  of  Crown  lands  in  the  prairie  provinces,  to 
prevent  a  repetition  of  what  has,  hitherto,  been  a  great 
detriment  to  the  prosperity  of  these  province.s.  It  may  be 
said  that  when  the  settlers  sell  their  holdings,  or  die,  there 
will  be  gradual  subdivisions  of  their  farms  into  more  con- 
veniently worked  acreages,  but  that  implies  long  perloua 
of  years.  Why  should  the  Government  wait  patiently  for 
that  result  when  already  as  to  its  remaining  lands  the 
remedy  is  In  Its  hands? 

Another  indirect  result  followed.  The  early  over-op- 
timism of  the  townspeople  in  many  cases  led  the  towns 
into  ultimate  financial  difficulty.  With  large  ideas  of  the 
future,  and  without  waiting  for  an  incoming  population, 
they  included  wide  areas  within  the  towns'  corporate  lim- 
its, unduly  increased  by  this  means  the  assessed  value  of 
property,  and  borrowed  money  freely  for  public  utilities 
and  other  civic  improvements — only  afterwards  to  find  the 
population  practically  stationary,  or  possibly  receding,  bus- 
iness depressed,  and  an  annual  burden  of  interest  and 
other  debts  which  could  be  met  by  the  town  with  difficulty, 
or  had  to  be  defaulted.  And  yet,  surrounding  nearly  all  of 
the  towns,  was  magnificent  land,  requiring  its  fertility  to 
be  maintained,  and  its  available  acreage  to  be  fully  cul- 
tivated, to  give  progress  and  prosperity  to  these  towns  and 
their  inhabitants,  as  well  as  to  the  farming  community 
itself  and  to  the  railways. 

Northern    Ontario 

The  climatic  difficulties  which  have  to  be  contended 
with  in  Northern  Ontario  form  a  strong  reason  why  the 
Ontario  Government  should  not  encouarge  agricultural  im- 
migants  from  Great  Britain  to  take  up  land  there.  A  char- 
acter of  country  and  climate,  accompanied  by  serious  pio- 
neer difficulties,  exists  there,  to  which  the  British  immi- 
grant has  been  wholly  unaccustomed.  That  the  great 
majority  of  the  trees  and  shrubs  of  Central  Ontario  have 
ceased  to  range  northward  long  before  Lake  Abitibi  and 
the  Transcontinental  Railway  are  reached,  evidently  un- 
able to  withstand  the  short  summers,  the  early  frosts  and 
the  winter's  cold  prevailing  there,  is  ample  evidence  that 
agriculture  has  iCJ  limitations  in  this  north  land.  The 
wide  extent  of  a  v'dry  there  will  have  to  be  left  to  agri- 
cultural pioneers  ti"om  the  provinces  of  Quebec  and  On- 
tario who,  in  advance,  know  the  character  of  the  country 
and  climate  and  are  prepared  "to  rough  it"  there  for  some 
years.  To  the  southward  of  this,  most  of  the  Laurentian 
and  Huronian  country,  with  its  rocky  hills  and  ridges,  and 
generally  sparse  soil,  should  be  set  apart  solely  for  timber 
growth,  and  properly  protected  from  fire,  with  the  objStft 
of  being,  in  its  timber  an  annual  revenue  asset  for  the 
future,  in  addition  to  its  great  possibilities  in  minerals. 

What  seems  a  far  more  suggestive  policy  for  Ontario  is 
that  of  endeavoring  to  attract  theshe  British  immigrants 
to  the  grass  lands  formerly  cultivated,  which  are  found 
here  and  there  in  some  of  the  best  counties  of  the  province, 


Up. 


January   6,   1922. 


THE      MONETARY      TIMES 


118 


£<iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiriiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii:: 

I  PROVINCE  of  NOVA  SCOTIA  | 

I  Stable  MarJ^ets  And  New  Industrial  Opportunities.  | 


S  Financial   stability   is   of  paramount   importance  during  this  period.      Nova  Scotia's  people  possess  ; 

S  to  a  marked  degree  those  qualties  of  integrity,  industry   and    thrift   that   are   first   considerations  in   the  j 

=  Financial  World,  and  her  security  from  the  standpoint  of  the  Bond  Market  is  most  soundly  assured.  ; 

=  It  is  also  significant  to  the  Business  Man  that  there    have  been   fewer   failures,    comparatively   speaking.  : 

=  in  the  year  1921  in  Nova  Scotia  than  in  any  other  Province  in  Canada.  : 

S  Nova  Scotia  possesses  all  the  basic  resources  for   the   establishment   of   industries   and    occupies  a  : 

=  unique  position  for  the  development  of  Foreign  Trade.      A  number  of  water  power  developments  of  E 

=  modern  design  and  permanent  construction  have  been     completed.         An     outstanding     development,  i 

=  which  will  supply  the  City  of  Halifax  with  elecrtical  energy,   is  located  at  St.  Margaret's  Bay  and  will  z 

5  have  an  initial  capacity  of   10,000  to   15,000  h.p.      This   development   in    size,    efficiency   and   perman-  = 

E  ency  of  construction,   compares  with  hydro-electrical  developments  in  other  parts  of  the  country.    Elec-  = 

E  trical  energy  can  be  delivered  in  Halifax  from  this  development  at  a  cost  that  will  compare  favourably  E 

E  with  existing  rates  in  other  parts  of  Canada.  E 

rilllMIIMMIIIIIIillllllllllllllllllMIIIHIIIIIIIIIIIIMIIIIMIIinilllllllMIIIIMI  IhliMIMMIIIIHIIMilllllllllllMllllllllllinillllllllUMMIMIIIIIIIIIIMIIr 


THE 

BOND  AND  DEBENTURE 

CORPORATION 

OF  CANADA,  LIMITED 

Dealers  in 

(iOVKKNMKNT    AND    Ml'MCIPAL 

BONDS 


OoiT«iipon<lence  Invited 


UNION   TRUST   BUILDING 
WINNIPEG 


HIGH    CLASS 
GOVERNMENT 

AND 

M  U  N I  CI  PAL 
BONDS 


VICTORY 
BONDS 


The  Securities  Corporation 

of  British  Columbia,  Ltd. 
Credit  Foncier  Bldg..  Vancouver,  B.C. 

W.  I  .  niXXAlilX,  Miin««»>r 


114 


THE      MONETARY      TIMES 


Volume  68. 


and  to  the  numerous  farms  everywhere,  whether  adapted 
to  stock,  grain  or  fruit,  which  for  various  reasons  are  al- 
ways on  sale.  Following  the  successful  plan  adopted  by 
the  Dominion  Government  for  the  soldiers  who  had  re- 
turned from  the  war,  (1)  descriptions,  prices  and  terms 
of  payment  should  be  secured  for  such  lands  and  em- 
bodied in  pamphlet  form  ^or  distribution  on  a  large 
scale  in  Great  Britain  as  well  as  among  immigrants  here; 
and  (2)  supplementing  this,  arrangements  should  be 
made  by  the  Dominion  or  Ontario  Governments,  in  co-op- 
eration with  the  British  Government,  under  which,  where 
necessary,  the  funds  needed  tor  the  purchase  If  not  only 
the  farms  but  of  the  stock  and  implements,  would  be  in 
large  part  loaned  on  easy  terms. 

Emigration   From    England 

And  there  Is  another  emigration  field  in  England, 
open  year  by  year,  for  exploitation.  Very  many  of  the 
good  conduct  men  who  are  annually  retired  from  the  Brit- 
ish Army,  and  numbers  of  whom  had  been  originally  draft- 
ed from  the  agricultural  districts,  are  desirous  of  coming 
to  Canada  to  engage  in  farming.  They  would  be  directly 
assisted  by  the  military  authorities,  who  are  always  anx- 
ious to  have  them  satisfactorily  placed.  They  even  of- 
fered to  the  writer  to  give  those  who  lacked  experience, 
the  opportunity  of  gaining  it  on  English  farms  berore  they 
left  for  Canada,  if  our  Government  would  encourage  this 
class.  And  why  should  it  not?  These  men  would  often 
be  desirable  for  community  settlements,  which  the  British 
Government  is  understood  to  favour.  Numbers  coming 
from  the  same  company  in  a  regiment  would  be  old  com- 
rades and  friends,  and  would  readily  co-operate  with,  and 
encourage,  each  other  when  on  neighbouring  farms,  whilst 
the  principles  of  obedience  to  superiors  and  loyalty  to  the 
Empire,  which  they  had  learned  when  in  the  army  wculd 
be  valuable  assets  for  the  country!  Group  settlements  of 
foreigners  in  the  prairie  provinces  have  not  always  been 
satisfactory,  but  there  is  a  class  of  tried  British  subjects 
whom  the  Dominion  Government  in  co-operation  with  the 
Home  authorities  might  well  encourage. 

Abolish    Free    Grants 

An  important  question  now  arises  in  connection  with 
the  changed  conditions  under  which  direct  financial  aid  is 
given  to  emigrants  from  Great  Britain  by  both  the  Home 
and  Dominion  Governments,  whether  free  grants  of  land 
should  not  be  abolished,  and  the  New  Zealand  land  plan 
of  fixing  a  price  per  acre  on  the  land,  should  not  be  adopt- 
ed. Following  a  course  similar  to  that  carried  out  in  the 
case  of  the  Canadian  returned  soldfers,  a  house  and  barn 
would  be  built  on  the  land  selected,  the  immigrant  as- 
sisting in  this  and  in  breaking  the  sod,  and  being  paid 
for  his  services,  and  further  funds  would  be  advanced  to 
aid  in  securing  stock  and  implements.  The  whole  outlay, 
including  the  price  of  the  land,  which  wciiild  be  moderate, 
would  then  be  payable  in  instalments  spread  over  a  long 
period,  with  interest,  until  then,  at  five  per  cent.  The 
Crown  patent  for  the  land  would  only  be  issued  wTien  the 
entire  government's  claim  was  paid,  and  until  then  no 
assignment  permitted  without  its  assent.  The  bare  fact 
of  settlement  and  cultivation  would  largely  increase  the 
value  of  the  property  and  render  it  good  security  for  the 
advances,  whilst  if  a  new  settler  can  be  appraised  at  $1,- 
000  in  potential  value,  the  country,  the  railways  and  the 
business  of  the  nearby  town  would  be  directly  benefitted. 
This  plan  would  afford  the  opportunity  to  the  Dominion 
Government  to  adopt  the  eighty  acre  plot  proposal,  and 
thus,  at  once,  to  double  the  number  of  settlers  and  the 
production  within  given  areas,  besides  enabling  these  set- 
tlers to  be  near  each  other,  which  under  any  small  or 
large  community  system  is  so  very  desirable. 


BOARD  OF  COMMERCE  ACT  ULTRA  VIRES 

,  Decision  of  Privy  Council  Concludes  Career  of  Institution 
Wliich  Was  Unpopular  Element  in  Industrial  liil'e 

ON  November  11  the  Privy  Council  decided  that  the 
Canadian  Board  of  Commerce  Act  and  the  Combines 
and  Fair  Prices  Act  were  ultra  vires  of  the  Dominion  Par- 
liament. This  decision  definitely  concluded  the  spectacular 
career  of  the  Board  of  Commerce  in  Canada.  In  October, 
1920,  its  activities  ceased  pending  the  outcome  of  the 
appeal.  Its  existence  during  the  intervening  year  was 
nominal.  The  six  judges  of  the  Supreme  Court  of  Can- 
ada had  been  equally  divided  on  the  case. 

Privy  Council's  Views. 

The  Privy  Council's  judgment,  read  by  Lord  Haldane, 
observes  that  the  law  is  not  one  enacted  to  meet  special  war- 
time conditions,  but  was  passed  in  1919,  after  peace  had  been 
declared,  and  was  not  confined  to  any  temporary  purpose,  but 
was  to  continue  without  any  time  limit  and  was  to  apply  to 
the  whole  of  Canada.  It  may  well  be  that  the  subjects  of 
undue  combination  and  hoarding  are  matters  wherein  thi* 
Dominion  has  great  practical  interest,  and  that  such  interest 
in  special  ci'-cumstances  might  conceivably  become  para- 
mount, overriding  other  interests  in  importance  even  in  times 
of  peace,  but  it  is  quite  another  matter  to  say,  under 
normal  circumstances,  that  a  general  Canadian  policy  can 
justifj?  interference  on  such  a  scale  as  the  statutes  in  contro- 
versy, which  involve  the  property  and  civil  rights  of  the 
inhabitants  of  the  provinces.  It  is  to  the  provincial  legisla- 
tures that  the  regulation  and  restriction  of  their  civil  rights 
have,  in  general,  been  exclusively  confided,  and  as  to  these 
the  provincial  legislatures  possess  quaai-sovereign  authority. 

It  can,  therefore,  he  only  under  highly  exceptional 
necessity  such  as  cannot  be  assumed  to  exist  in  the  present 
case,  that  the  liberty  of  the  inhabitants  of  the  provinces  may 
be  restricted  by  the  Canadian  Parliament,  and  that  the 
Dominion  can  intervene  in  the  interests  of  Canada  as  a  whole 
in  questions  such  as  the  present  one. 

No  Evidence  Found. 

In  the  ca^e  before  the  Privy  Council,  however,  important 
as  it  may  seem  to  the  Canadian  Parliament  that  some  such 
policy  as  that  adopted  in  the  two  acts  in  question  should  be 
made  general.  TIeir  Lordships  do  not  find  any  evidence  that 
the  standard  of  necessity  reff  i-red  to  ha<i  been  reached  or  that 
attainment  of  the  end  Foug'ht  is  practicable,  in  view  of  the 
distribution  of  legislative  powers  enacted  by  the  Constitution 
Act,  without  the  co-operation  of  the  provincial  legislatures. 

It  may  be  that  it  is  within  the  power  of  the  Dominion  to 
call,  for  example,  for  statistical  and  other  information  which 
may  be  valuable  for  guidance  in  questions  affecting  Canada 
as  a  whole.  Such  information  may  be  required  before  any 
power  to  regulate  trade  and  commerce  can  be  properly  exer- 
cised even  where  such  power  is  construed  in  a  fashion  much 
narrower  than  that  in  which  it  was  sought  to  interpret  it  in 
the  argument  before  the  Canadian  Attorney-General.  But 
even  this  consideration  affords  no  justification  for  interpret- 
ing the  words  of  Section  91  in  a  fashion  which  would  make 
them  confer  a  capacity  to  regulate  particular  trades  and 
businesses. 

Their  Lordships,  therefore,  are  of  the  opinion  that  the 
first  question,  whether  Parliament  can  validly  enact  such  a 
law,  must  be  answered  in  the  negative..  The  second  question, 
consequently,  does  not  arise. 


MARKING  OF  IMPORTED  GOODS. 


BRITISH  EMPIRE  PRODUCERS. 


B.  H.  Morgan,  chairman  of  the  CouHcil  of  the  British 
Empire  Producers  Organization,  visited  Canada  in  August 
to  work  for  an  extension  of  imperial  preferences. 


Legislation  was  passed  at  the  last  session  of  parliament 
authorizing  the  government  to  require  imported  goods  to  he 
marked  with  the  name  of  the  country  they  came  from.  Su  vi 
remilations  were  prepared  by  the  Customs  Department,  wit'i 
a  view  to  having  them  "-o  into  effect  as  at  October  1.  StroriT 
protests  came  in.  however,  and  the  date  was  postponed  to 
December  31.  Several  changes  were  also  made  in  th" 
re»rulations 


January  6,   1922. 


THE      MONETARY      TIMES 


US 


nuiiniiiiiuiiiiiiiiHiiiiiiiiiiiiiiiiiiiiiiiiiiiiii^^ 


w 


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INSURANCE  COMPANIES 

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116 


THE       MONETARY      TIMES 


Volume  68 


Some  Problems  in  Municipal  Administration 

Fundamental  Principles  of  City  Plemning  Have  Been  Ignored — 
Some  Examples  of  How  Present  Methods  are  Defective,  and  Some 
Remedies  Proposed — Problems  of  Finance  are  of  Foremost  Importance 

BY   €.   J.  YORATH,    • 

City  Commissioner,  Edmonton 


JN  ALL  cities  in  Western  Canada,  although  compara- 
tively of  recent  growth,  the  fundamental  principles 
of  city  planning  have  been  entirely  ignored  and  the 
checker-board  system  of  planning  of  the  United  States 
has  been  slavishly  follov?ed  without  regard  for  topo- 
graphy or  configuration  of  the  site.  Our  cities  have  not 
been  developed  upon  some  preconceived  plan,  but  have 
been  added  to  in  patches  according  to  the  whims  and 
fancies  of  real  estate  speculators  with   the  result  that  : 

1.  Residential,  retail  and  wholesale  districts  are 
not  placed  in  proper  relation  to  each  other,  resulting  in 
considerable  loss  in  time  and  undue  inconvenience  to 
the  citizens,  and  an  unnecessary  expenditure  upon  paved 
roads  has  been  incurred  to  connect  the  different  centres. 
These  roads  being  constructed  upon  a  local  improve- 
ment basis,  the  frontage  tax  has  been  so  excessive  on  the 
adjoining  property  that  the  city,  as  a  result  of  tax  sales, 
has  become  the  title  holder,  and  owing  to  the  haphazard 
development  of  the  community,  will  have  to  retain  same 
for  many  years  in  an  unproductive  state  until  incre.ised 
development  will  create  a  demand  for  this  class  of  pro- 
perty. This  condition  of  affairs  has  altered  the  whole 
aspect  of  financing  such  improvements,  for  instead  of  the 
greated  part  of  the  cost  being  borne  by  the  property 
benefited,  it  will  have  to  be  carried  by  the  city  at  large, 
thus  reducing  the  amount  available  for  current  expendi- 
ture, or  if  all  other  services  .are  maintained  at  a  proper 
standard,   increasing  the  rate   of  taxation. 

2.  The  most  direct  routes  for  main  arterial  roads 
leading  to  the  surrounding  country  and  centres  of  devel- 
opment from  the  retail,  residential  and  industrial  centres, 
railway  depots,  freight  yards,  etc.,  have  not  been  pro- 
vided. This  means  a  very  great  economic  loss  in  unnec- 
essary and  increased  cost  of  transportation,  loss  of  labour 
and  in  consequence  loss  of  production.  In  a  city  which  is 
widely  scattered  this  lack  of  proper  town  planning  means 
an  increase  in  the  cost  of  living  as  the  unit  cost  of  every 
commodity  of  life,  fuel,  groceries,  building  material, 
merchandise,  etc.,  will  be  increased  due  to  the  increase 
In   the   cost   of   transportation. 

3.  The  developed  areas  are  not  compact.  This  fault 
in  planning  Is  largely  due  to  the  indiscriminate  sub- 
division of  land  and  is  chief  cause  for  financial  embarass- 
inent  of  municipalities  today.  The  more  scattered  the 
community  the  greater  will  be  the  annual  cost  tor  police 
and  fire  protection,  the  collection  of  garbage,  the  repair 
of  roads  and  sidewalks,  the  construction  and  mainten- 
ance of  sewers  and  where  the  municipality  owns  and 
operates  its  public  utilities  the  increased  capital  cost  of 
extending  water  mains,  electric  light  and  power  wires 
street  railway  and  in  some  cases  telephone  service.  In 
addition  to  the  Increased  cost  of  maintenance  the  more 
scattered  the  community  the  greater  will  be  the  capital 
expenditure  for  increased  pumping  capacity  at  the.  pump- 
ing station  and  increased  power  at  the  power  house  so 
that  water  and  power  respectively  can  be  distributed  over 
a   wider   area. 

When  any  of  the  above  services  have  to  be  constructed 
upon  a  local  improvement  basis  and  the  cost  assessed 
against  adjoining  property.  If  the  buildings,  residences, 
etc.,  to  be  served  are  widely  scattered  it  will  be  realized 
that  the  frontage  tax  against  unimproved  and  undevel- 
oped property  will  be  such  that  the  burden  of  taxation 
will   be   too    great   during   periods   of   depression,   and    the 


owners  will  eventually  surrender  same  to  the  city  tor 
taxes.  In  other  words,  the  city  will  become  the  title 
owner  to  vacant  property  due  to  confiscation  by 
local  Improvement  taxation,  brought  about,  in  the  large 
majority  of  cases,  by  owners  of  scattered  developed  pro- 
perty clamoring  for  improvements,  which  will  ultimately 
mean,  if  constructed,  increasing  the  load  of  taxation,  not 
only  to  themselves,  but  to  all  other  improved  property 
owners  in  the  city. 

""T'his  is  a  very  serious  phase  of  community  develop- 
ment, and  unless  given  very  careful  and  mature  con- 
sideration will  result  in  still  further  Increasing  the  fin- 
ancial difficulties  of  our  municipalities.  Take  for  example 
a  water  main  which  may  be  constructed  to  serve  a  number 
of  scattered  houses;  in  the  first  place  the  estimated  rev- 
enue may  be  based  (a)  upon  revenue  from  water  rates 
and  (b)  revenue  from  frontage  tax.  The  latter  revenue 
may  in  a  few  years,  and  often  is,  reduced  to  a  very  small 
percentage  of  the  original  amount,  owing  to  the  pro- 
perty against  which  the  frontage  tax  is  assessed  becom- 
ing the  property  of  the  city.  The  same  remarks  apply 
to  sidewalks,  sewers,  roads,  etc.,  constructed  on  a  local 
improvement  basis,  so  that  the  more  scattered  the  district 
which  is  to  be  served  the  greater  will  be  the  amount  of 
taxes  which  the  improved  property  owner  will  have  to 
bear  and  which  may  eventually  lead  to  the  confiscation 
of  his  property  also. 

Unfortunately,  then,  instead  of  being  able  to  apply 
town  planning  ideals  with  the  view  to  preventing  mis- 
takes which  mean  the  unnecessary  expenditure  of  a  very 
large  sum  of  money,  we  need  planning  of  existing  con- 
ditions and  the  adoption  of  sound  principles  to  govern 
further  extensions  so  that  the  inconveniences  and  exces- 
sive taxation,  instead  of  being  still  further  increased, 
will  be  somewhat  modified. 

Property  Owners'   Demands 

Since  the  termination  of  the  war  there  has  been  a  very 
persistent  demand,  and  in  some  cases  rightly  so,  by  the 
owners  of  developed  property  not  served  with  public  util- 
ities for  extensions  so  that  they  may  obtain  services 
regardless    of 

(a)  The  distance  their  property  may  be  from  exist- 
ing   utilities; 

(b)  The   expenditure   involved; 

(c)  The  scattered  development  of  the  area,  through 
whicfl  the  extension  will  have  to  be  made  to  reach  their 
property; 

(d)  The  number  of  vacant  lots  owned  and  likely  to 
be  owned  by  the  municipality  and  through  which  the 
extension  will  have  to  be  made. 

(e)  Whether  the  revenue  to  be  derived  would  war- 
rant   making   the    extension. 

These  requests  are  usually  based  upon  the  fact  that 
the  extensions  have  been  promised  by  the  municipal 
council  for  a  number  of  years  in  some  cases  as  far  back 
as  1913. 

The  Mayor  and  Aldermen,  particularly  those  who 
contemplate  a  continuance  in  office,  find  it  extremely  dif- 
ficult to  resist  such  requests  and  In  many  cases  are  only 
too  willing  to  grant  same  and  will  even  go  so  far  as  to 
agree  to  temporary  extensions  in  order  to  meet  the  wishes 
of  certain  citizens.  This  policy  can  only  have  one  result, 
i.e.,  to  increase  the  already  heavy  burden  of  taxation, 
and  to  expend  money  at  the  present  time  which   in  a  few 


January   6,   1922. 


THE      MONETARY      TIMES 


117 


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118 


THE      MONETARY      TIMES 


Volume    68 


years  will  be  entirely  wasted,  as  it  will  be  found  that  the 
extensions  made  will  not  work  in  with  a  permanent 
scheme  of  improvement. 

Financial  Factors 

The  iinances  of  the  municipalities  are  such  at  the 
present  time  that  they  cannot  stand  such  a  policy  and, 
If  allowed  to  continue,  it  will  mean  an  increasing  num- 
ber of  municipalities  who  will  have  to  make  terms  with 
their    bond    holders. 

In  addition  to  the  adjustment  in  assesment  and  tax- 
ation which  is  so  urgently  necessary  in  all  our  munici- 
palities In  order  to  adjust  the  financial  situation  there 
will  also  require  to  be  established  a  very  definite  and 
comprehensive    policy    in    regard    to    future    developments. 

The  old  method  of  haphazard  development  of  im- 
provements cannot  and  must  not  be  allowed  to  continue 
if  the  present  situation  is  to  be  retrieved  and  lack  of  con- 
tinuity in  the  direction  of  municipal  methods  of  develop- 
ment should  be  immediately  discontinued. 

Control  by  Boards 

Rather  than  the  policy  advocated  by  some,  that  each 
municipality  should  work  out  its  own  salvation  and  that 
there  should  be  "Home  Rule"  so  tar  as  Local  Government 
is  concerned,  there  should  be,  if  we  are  genuine  in  our 
desire  to  correct  the  evils  of  the  past  and  to  prevent  their 
recurrence  in  the  future,  an  expert  "Local  Government 
Board,"  who  will  define  a  policy  and  direct  the  activities 
of  our  municipal  governments,  both  in  regard  to  existing 
financial  difficulties  and  In  regard  to  future  development, 
so  that  these  difficulties  will  be  gradually  removed  and 
will   be   impossible   of  recurrence. 

It  is  true  that  we  have  in  the  Province  of  Alberta  a 
Public  Utility  Commission  and  in  the  Province  of  Sask- 
atchewan a,  Local  Government  Board,  who  must  pass  upon 
all  future  capital  expenditures,  but  are  the  powers  and 
functions  of  these  Boards  sufficient  having  regard  to  the 
conditions  which  have  arisen  through  the  lack  of  expert 
guidance  in  the  development  of  our  communities  in  the 
past? 

The  question  of  extensions  should  not  be  left  to  lo.cal 
political  considerations,  but  an  independent  Government 
Board  should  say  whether  the  improvements  should  be 
carried  out  in  the  best  interest  of  the  community  as  a 
whole,  and  in  accordance  with  some  preconceived  plan 
of  development,  so  that  eventually  the  units  will  form 
part   of  a  completed  scheme. 

The  above  suggestions  are,  in  the  writers'  opinion, 
necessary  if  the  difficulties  of  all  our  municipalities  are 
to  be  properly  dealt  with.  If  the  municipalities  cannot 
agree  upon  some  such  centralized  action  of  control  and 
guidance  of  their  development  and  capital  expenditures, 
then  each  municipality  will  have  to  work  out  itg  own 
salvation,  even  although  it  may  mean  a  costly  process 
with  a  varying  degree  of  success  or  failure,  according  to 
the  methods  and   policy  adopted   by  each   municipality. 

A  Plan  for  Municipalities 

The  procedure  which  should  t  s  followed  by  each 
municipality   is   shortly   as   follows  : 

1.  A  complete  survey  should  be  made  of  the  methods 
of  assessment  and  taxation  and  a  readjustment  of  cash 
revenues  so  that  they  will  more  nearly  meet  the  estimated 
expenditures.  A  report  has  already  been  prepared  in  the 
city  of  Edmonton  covering  this  phase  and  will  be  referred 
to  later  under  the  heading  of  "Finance." 

2.  A  comprehensive  plan  should  be  prepared  by 
every  community  showing  conditione  as  they  exlslt 
at   present,   i.e.: 

(a)  Existing  retail,  wholesale  and  manufacturing 
districts; 

(b)  Existing    residential    districts; 

(c)  Existing  main  roads  of  communication  between 
districts  and  points  of  importance,  such  as  railway 
depots,  hospitals  and  principal  public  buildings; 

(d)  Existing  sewers,  water  mains,  pavements,  side- 
walks   (cement   and   wooden),    street   railway   tracks,   etc. 


(c)      Existing   street   lights; 

(f  Land  already  acquired  by  the  community  for 
parks  and  open   spaces; 

(g)      Existing   buildings   of   all   classes; 

(h)  The  buildings  at  present  on  sewer  and  water 
mains    not    connected; 

(1)  The  lots  owned  by  the  city  as  a  result  of  tax 
sales. 

3.  The  plan  above  referred  should  show  future 
extensions  of  improvements,  having  regard  to  existing 
development  and  possible  development  of  the  future,  and 
extensions  should  only  be  made  from  time  to  time  as 
required  in  accordance  with  this  plan,  so  that  eventually 
the  units  will  become  part  of  the  completed  scheme. 

Problems  of  Finance 

Municipalities  are  finding  that  the  problem  of  financ- 
ing current  account  is  becoming  increasingly  difficult 
and  owing  to  conditions  which  exist  at  the  present  time 
they  find  that  during  the  last  three  months  of  a  financial 
year  it  is  almost  impossible  for  them  to  finance  their 
current  expenditures. 

What    has   brought   about   this   condition   of   affairs: 

1.  The  banks  will  only  advance  money  on  current 
loans  equivalent  to  the  estimated  collection  of  current 
taxes; 

2.  The  municipalities  only  collect  from  60  to  75  per 
cent,  of  current  taxes,  while  te  the  same  time  practically 
one  hundred  per  cent,  of  their  expenditures  have  to  be 
made  in  cash. 

In  the  Province  of  Alberta  the  municipalities  are 
compelled  by  law  to  pay  over  to  the  School  Boards  one 
hundred  per  cent,  of  their  current  year's  tax  levies 
whether  they  are  collected  or  not,  and  in  some  cases  where 
short  term  debentures  have  been  sold  on  security  of 
arrears  of  taxes  the  whole  of  arrears  collected  have  to 
be  paid  into  the  sinking  fund  to  secure  the  repayment  of 
these  debentures. 

It  can  be  readily  understood  why  under  such  circum- 
stances the  municipality  has  di....culty  in  meeting  Its 
obligations,  particularly  in  those  cases  where  the  per- 
centage of  current   taxes   collected  is  small. 

To  pay  one  hundred  per  cent,  of  the  tax  levy  of  school 
boards,  and  one  hundred  per  cent,  of  debenture  charges 
out  of  say  sixty  per  cent,  collections  is  a  problem  which 
requires  considerable  ingenuity  to  solve.  Yet  one  still 
finds  from  time  to  time  appeals  through  the  editorial  col- 
umns of  our  daily  newspapers  not  to  be  too  drastic  on 
the   enforcement   of   tax   collections. 

Lack  of  Enforcement 

The  lack  of  a  very  rigid  enforcemnt  of  taxes  in  the 
past  has  been  a  curse  not  only  to  the  municipality,  but 
also  to  the  taxpayer,  because  it  means  increased  taxation 
on  the  good  taxpayer  and  increased  financial  obligations 
with  their  attendant  interest  charges,  etc.  Tax  collections 
have  been  very  much  better  in  those  provinces  where  tax 
enforcement  has  been  strictly  adhered  to,  even  through- 
out the  period  of  the  war,  with  the  result  that  the  mun- 
icipalities in  those  provinces  are  in  better  financial 
standing  today. 

What  are  the  reasons  for  the  poor  collection  of  taxes 
in  addition  to  the  laxity  of  enforcement  ? 

They  are: 

1.  Assessing  land   far  beyond  its  normal  value. 

2.  Not  assessing  the  full  value  of   improvements. 

3.  Heavy  levies  of  local  improvement  taxes  upOn 
vacant  property. 

4.  Placing  too  great  a  burden  of  taxation  on  pro- 
perty; and  not  broadening  the  basis  of  taxation  so  as  to 
produce  a  higher  percentage  of  cash  revenue. 

5.  The  slow  and  cumbersome  procedure  in  acquiring 
title  to  property  at  tax  sales,  thereby  reducing  the  num- 
ber of  taxpayers  on  the  roll  and  prolonging  the  period 
before  this  property  can  be  revenue  bearing  insofar  as 
taxes  are  concerned. 

6.     Not   conducting   an    active   sale   of   tax    sale   certifi- 
cates immediately  and  continuously  after  a  tax  sale. 


January  6,   1922. 


THE      MONETARY      TIMES 


119 


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120 


THE       MONETARY       TIMES 


Volume     68 


7.  Retaining  on  the  tax  roll  properties  ■  which  have 
been  sold  at  tax  sales  to  the  municipality. 

It  is  no  wonder  that  municipalities  have  got  into  such 
financial  difficulties,  when  one  realizes  the  absurd  and 
ridiculous  policies  which  have  been  adopted.  This  is 
rather  an  emphatic  statement  to  make,  but  it  is  never- 
theless true  and  no  object  can  be  atained  by  glossing 
over  the  facts. 

The  Basis  of  Taxation 

It  is  therefore  imperative  that  municipalities  re-adjust 
their  basis  of  taxation  so   that: 

(a)  Land  will  only  be  taxed  in  accordance  with  its 
normal  value; 

(b)  Improvements  are  taxed  for  one  hundred  per 
cent,   of   their   value; 

(c)  The  burdens  of  taxation  is  not  excessive  and  as 
large  a  part  of  the  tax  levy  as  possible  is  obtained  from 
a  business  tax,  surplus  revenue  from  public  utilities, 
license  fees,   etc. 

The  city  of  Edmonton  proposes  to  reduce  the  assessed 
value  of  land  in  1922  by  $20,000,000,  which  will  reduce, 
with  the  present  mill  ratio,  the  tax  levy  on  property  by 
$780,000  and,  it  also  intended  to  make  a  further  reduction 
in  the  mill  rate  of  3  mills  by  broadening  the  basis  of 
taxation  in  the  way  outlined  above.  This  will  mean  with 
the  reduction  which  was  made  in  the  mill  rate  this  year, 
a  reduction  in  the  tax  levy  on  property  of  over  one  mil- 
lioc    dollars. 

In  addition  to  the  above  adjustments  and  in  order 
that  the  Council  of  the  municipality  may  be  in  a  better 
position  to  finance  its  current  expenditures,  it,  is  suggested 
that  either  one  of  the  two  following  methods  should  be 
adopted: 

1.  That  the  Council  of  the  municipality  be  compelled 
to  pay  to  the  School  Boards  only  their  percentage  of  the 
taxes  collected  and  the  Boards  be  given  power  to 
give  ten  year  debentures  to  a  chartered  bank  as 
security  for  any  loan  which  they  may  require  pending 
the  collecting  of  taxes.  Such  debentures  not  to  be  dis- 
posed of  by  the  bank  for  a  period  of  five  years  after  their 
date  of  issue  and  to  be  redeemable  from  time  to  time 
as  arrears  of  taxes  are  collected  and  paid  over  to  the 
Boards. 

(2)  That  the  Council  of  a  municipality  be  given 
power  to  create  a  reserve  for  financing  Its  current  account 
by  the  sale  of  debentures  on  the  general  security  of  the 
municipality  or  to  issue  debentures  to  a  chartered  bank 
as  additional  security  for  a  loan  pending  the  collection 
of  taxes,  upon  the  same  terms  as  referred  to  in  the  first 
method.  The  amount  of  any  such  issue  of  debentures  out- 
standing at  any  time  not  to  exceed  twenty  per  cent,  of 
the  current  year's   tax  levy. 

Defaulting  Municipalities 

A  number  of  large  financial  institutions  who  have  been 
accustomed  to  invest  their  funds  in  municipal  securities 
are  today  refusing  to  purchase  debentures  of  municipali- 
ties in  Western  Canada.  That  is  a  serious  statement  to  ■ 
make,  but  it  is  nevertheless  true,  and  anyone  connected 
with  Provincial  or  Municipal  Governments  should  realize 
what  effect  such  a  policy  will  have  upon  the  development 
of  urban  districts  in  the  West  and  what  additional  hand- 
icap it  will  be  to  communities  who  are  already  bearing 
a  tremendous  burden  of  taxation. 

A  municipal  security,  until  recent  years,  has  alwaysi 
been  looked  upon  as  "gilt  edged,"  and  as  a  result  such 
securities  have  always  sold  at  a  price  which  would  yield 
the  investor  very  little  more  interest  on  his  money  than 
If  he  had  invested  same  in  Dominion  Government  secur- 
ities. Small  municipalities  in  Manitoba  and  Alberta  have 
defaulted  in  the  payment  of  interest  on  their  debts,  but 
owing  to  the  prompt  action  taken  and  assistance  given 
by  the  Governments  of  those  Provinces,  their  municipal 
securities  are  looked  upon  with  more  favor  than  the 
securities  of  municipalities  in  Saskatchewan  where  the 
Government   has   adopted   a   different  policy. 


It  is  difficult  to  estimate  the  loss  which  will  be  sus- 
tained by  all  municipalities,  including  the  cities,  once 
the  confidence  of  financial  houses  has  been  shaken,  and 
municipalities  in  Western  Canada  cannot  lose  that  con- 
fidence without  incurring  a  very  grave  additional  burden 
to  tliose  which  have  already  been  incurred  by  unsound 
finance. 

School  and  City  Expenditures 

As  a  general  rule  the  School  Board  in  a  district  has 
separate  and  distinct  authority  from  the  Council.  Not  only 
can  it  control  education,  but  it  has  supreme  control  over 
its  finances,  regardless  of  the  general  financial  condition 
of  the  community.  It  often  happens  that  a  City  Council 
will  sell  debentures  to  finance  capital  expenditures  and 
very  soon  after  or  some  time  before,  the  School  Board 
will  also  go  on  the  market  to  sell  its  securities,  and  often 
regardless  of  what  has  been  done  by  the  City  Council. 
Was  anything  more  farcical?  Yet  it  is  quite  a  common 
procedure.  The  financing  of  all  capital  expenditure  in  a 
community  should  be  consolidated  under  the  City  Council 
and  that  authority  only  made  responsible  for  selling 
debentures. 

Local  Improvement  Debt 

A  considerable  part  of  the  debt  of  cities  is  represented 
by  money  expended  upon  local  improvements  such  as 
paving,  sidewalks,  drainage,  etc.  The  proportion  to  be 
charged  to  the  general  taxpayers  and  the  owners  of  the 
property  immediately  benefited,  varies  considerably;  the 
total,  however,  so  expended  is  usually  considered  as  part 
of  the  city  debt,  although  the  sinking  fund  and  interest 
on  the  amount  expended  as  the  properties'  share  is  spec- 
ially levied  against  the  properties  with  a  frontage  to  the 
street   improved. 

In  making  debt  comparisons  of  cities  in  Canada,  Great 
Britain,  and  the  United  States,  regard  must  be  given  to 
this  fact,  as  in  the  two  latter  countries  local  improve- 
ments such  as  have  been  described  are  made  by  the  Local 
Authorities  at  the  cost  of  the  adjoining  property  owners, 
i.e.:  the  total  cost  of  paving  a  street,  laying  sidewalks, 
constructing  drainage,  etc.,  when  completed  is  immed- 
iately charged  against  the  property  owners  fronting 
upon  the  street  so  improved;  thereby  making  the  cost 
of  street  improvements  part  of  the  capital  expenditure  of 
the  individual  property  owner  instead  of  the  local  auth- 
ority. 

The  local  improvement  procedure  adopted  in  the 
United  States  and  Great  Britain  is  very  much  to  be 
preferred  to  the  system  adopted  in  Canada,  as  the  cost 
of  such  improvements  spread  over  the  individual  owners 
of  lots  is  comparatively  small  and  does  not  add  materi- 
ally to  the  cost  of  the  Improvements  erected  on  their 
own   property. 

Another  considerable  advantage  in  charging  the  total 
cost  of  local  improvement  against  the  property  owner 
immediately  after  it  has  been  completed  is  that  it  deters 
an  owner  from  clamouring  for  improvements  until  he 
has  improved  his  own  property,  whereas,  under  our 
system  in  Canada  the  speculative  holder  of  land  clamours 
for  improvements  as  he  has  no  objection  to  paying  for 
a  year  or  two  the  small  annual  charge  of  sinking  fund 
and  interest  if  by  virtue  of  the  improvements  the  value 
of  his  property  is  enhanced  and  his  chances  of  selling 
same  have  considerably  improved. 

The  practice  of  charging  expenditures  to  a  loan  Is  car- 
ried to  such  extremes  by  some  cities  that  even  the  cost  of 
sewer  drain  and  water  connections  is  spread  over  a 
period  of  thirty  years.  When  methods  such  as  these  are 
adopted  it  is  little  wonder  that  the  debts  of  Canadian 
cities  compare  so  unfavorably  with  debts  of  other 
countries. 

Lack  of  Experienced  Control 

Municipal  finance  is  divided  into  two  different  phases, 
namely: 

CAPITAL   ACCOUNT— 

I.  REVENUE 

II.  EXPENDITURE 


January   6,   1922.  THEMONETARYTIMES  121 


CANADIAN 

GOVERNMENT,  MUNICIPAL 
AND  CORPORATION 

SECURITIES 

CANADIAN   DEBENTURES 

Corporation  Limited 

Established   1910 
36  King  Street  East TORONTO,    CANADA 


Tiie  Biiiisii  CoiumDia  Peimaniiiii  Loan  Co. 

Total  Assets,      $2,917,422^6 
Paid-up  Capital,  $926,721.24  Reserve,  $725,000.00 


DIRECTORS  AND  OFFICERS 

DAVID  H.  WILSON,   M.D.,   President  W.  H.  MALKIN,  Vice-President 

Chris.  Spencer  A.  H.  Douglas 

RonERT  Gelletly  Georoe  Martin 

R.  J.  Robertson 
Albert  Whittaker,   Inspector  James   Low,  Secretary-Treasurer 

T.  D.  MACDONAIiD.      General  Manager 


6   per  cent  on    Debentures — 3  or  5  Year  Periods 

A  General  Agency  Business,  including  Real  Estate,  Property  Management, 
Bonds,  Investments.  Insurance,  etc.  conducted  by 

The  British  Columbia  Permanent  Agencies  Limited 

(Owned    and   controlled    by     The   British    Columbia   Permanent   Loan    Co.) 

Correspondence    invited. 

Head  Office     :     :     :     330  Pender  Street  West,    VANCOUVER,  B.  C. 


122 


THE      MONETARY      TIMES 


Volume    68 


CURRENT   ACCOUNT— 

I.  Revenue 

II.  expenditure 

The  hazy  ideas  as  to  the  relationship  between  these 
two  phases  of  municipal  finance  are  perhaps  responsible 
for  the  many  serious  problems  which  arise  in  connectien 
with  the  financing  of  municipal  undertakings.  It  was 
at  one  time  a  common  practice,  and  is  now  with  many 
local  authorities,  to  embark  upon  works  requiring  the 
expenditure  of  large  sums  of  capital  monies  before  making 
the  necessary  arrangements  to  finance  the  cost  of  the 
work- — and  then,  when  it  Is  realized  that  work  and  im- 
provements cannot  be  carried  out  without  money,  it  is 
found  that  the  market  is  not  satisfactory  for  the  sale  of 
debentures.  Temporary  financial  arrangements  then 
have  to  be  made  with  all  the  disadvantages  and  loss 
usually  attendant  thereto.  The  lesson  of  the  last  few 
years  may  be  a  sufficient  deterrent  to  a  repetition  of  the 
A«ame  mistake,  but  it  is  more  than  likely,  with  the  contin- 
ual change  In  the  personnel  of  Local  Government,  that 
the  same  mistakes  and  mismanagement  will  be  repeated 
unless  the  fundamental  principles  of  sound  municipal 
finance  are  controlled  and  guided  by  experienced  manage- 
ment. 

What  is.  and  what  is  not,  capital  expenditure  must 
he  distinctly  defined  by  the  lifetime  of  the  work  pro- 
posed to  be  carried  out,  and  it  should  be  recognized  aa 
a  general  principle  that  no  work  with  a  lifetime  of  less 
than  five  years  should  be  paid  for  out  of  capital  monies. 

There  is  one  result  of  capital  expenditure  which  the 
public  cannot  be  too  often  reminded  of,  which  is,  that 
every  cent  spent  in  this  way  means  so  much  more  added 
to  the  taxes  each  year  in  payment  of  principal  and  in- 
terest. 

The  method  ladopted  by  some  local  authorities  In 
making  an  issue  of  debentures  is  sometimes  open  to 
criticism.  Issues  are  placed  upon  the  market  when  there 
is  no  demand  for  such  securities  and  it  sometimes  occurs 
that  a  local  authority  will  make  two,  three  or  even  more 
Issues  in  one  year.  Whether  the  sinking  fund  or  serial 
debenture^sEould  be  adopted  Is  largely  governed  by  the 
market  in  which  the  securities  are  to  be  sold  and  the  pre- 
ference shown  by  that  market.  There  can  be  no  doubt 
that  the  serial  method  has  a  number  of  advantages  to 
commend  it  in  preference  to  the  sinking  fund  debenture, 
the  principal  of  which  is  that  no  sinking  fund  is  created, 
thereby  removing  the  necessity  of  reinvestment  and  the 
risk  of  loss  by  making  bad  investments. 

There  is  only  one  way  in  which  capital  expenditures 
can  be  controlled  and  the  necessary  financial  arrange- 
ments be  properly  made,  and  that  is  by  forecasting  and 
planning  all  the  works  to  be  carried  out  during  the  year 
at  the  beginning  of  the  financial  year.  But  even  this 
system  will  not  be  entirely  satisfactory  and  prevent  the 
waste  of  public  money,  if  the  programme  bears  no  rela- 
tion to  a  scheme  which  should  have  been  previously  pre- 
pared for  the  ultimate  development  of  the  town  or  city. 
Any  expenditure  upon  an  extension  of  a  drainage,  sew- 
erage, waterworks,  electric  light  and  power  or  rapid 
transit  system,  or  upon  the  construction  and  paving  of 
streets,  if  not  made  in  relation  to  the  future  development 
of  the  community  will  be  eventually  partly  or  wholly 
wasted. 

Flooding  Market  With  Securities 
For  the  last  six  years  the  majority  of  municipalities 
have  been  marking  time  on  capital  expenditures,  first  on 
account  of  the  war,  and  then  afterwards  on  account  of 
financial  conditions  being  unfavorable  to  the  sale  of  de- 
bentures, with  the  result  that  at  the  present  time  certain 
very  necessary  capital  expenditures  have  to  be  made. 
Schools  have  to  be  built,  water,  electric  light  and  sewer 
extensions  have  to  be  made  and  additional  equipment 
has  to  be  Installed  at  power  plants  and  waterworks.  This 
results  in  different  authorities — Provincial,  local  Coun- 
cils, School  Boards,  etc.,  all  selling  securities  at  the  same 
time,  which  soon  results  in  the  flooding  of  the  market 
and  unfavorable  prices  being  obtained,   or  in   some  cases 


<i  failure  to  sell  debentures  at  any  price.  It  would  appear 
that  some  action  should  be  taken  by  the  Provincial  Gov- 
ernment in  conjunction  with  the  bond  dealers  to  consol- 
idate and  control  municipal  debenture  isSue.  In  Some  of 
our  larger  cities  when  the  issue  of  debentures  Is  not  par- 
ticularly large  it  would  appear  to  be  more  advantageous 
to  the  community  to  sell  the  bonds  if  possible  to  citizens 
rathe-  than  to  bond  houses  in  Eastern  Canada.  By  this 
method  the  citizens  will  have  the  greater  amount  at  stake 
in  their  community  and  it  will  be  in  their  best  Interests 
to  see  that  civic  affairs  are  properly  managed. 

Problems  of  Administration 

The  chief  problems  of  administration  is  to  obtain  con- 
tinuity of  policy  and  experienced  direction  of  the  adminis- 
trative detail  of  departments. 

This  is  one  of  the  chief  causes  for  municipal  difficulties 
today.  The  writer  has,  on  a  previous  occasion,  submitted 
a  paper  on  the  best  form  of  civic  government  and  would 
only  emphasize  its  essential  featurs  if  th  difficulties  re- 
ferred to  in  this  paper  are  to  be  surmounted  and  avoided 
in  the  future,  viz: 

The  division  of  Government  authority  into: 

(1).   Legislative  and  Financial 

(2)      Administrative 

1.  The  Council  being  directly  responsible  for 

(a)  Legislative  work  governing  the  need  of  the 
community 

"(b)       The    financing    of    public    improvements    and 
current  expenditures. 

2.  An  appointed  Commissioner  or  Manager  being  re- 
sponsible for: 

(a)  Keeping  the  Council  properly  Informed  upon 
every  phase  of  civic  finance  taxation  etc.  To  advise  upon 
the  most  economical  methods  of  development  and  service-— 
and — 

(b)  To   see   that   the   Council's   decisions   on   any 
subject,  policy  or  expenditure  are  strictly  carried  out  and 
adhered    to    by    the    respective    civic    departments      and  ' 
officials. 


OUR  TRADE  OPPORTUNITY  ON  THE  PACIFIO 


Of  Great  Importance  to  Country  and  Especially  to  Coast 
Province — Example  Set  by  The  United  States 


(CONTRIBUTED) 

THE  Pacific  ocean  is  the  world's  great  coming  theatre 
of  trade  development.  Fifty  years  ago  it  was  regard- 
ed much  as  the  Western  world  now  looks  on  Bfehring  sea. 
Canada  did  not  have  British  Columbia  as  one  of  the  units 
of  the  Dominion.  The  United  States  had  hardly  got  over 
the  California  gold  rush.  China  was  fast  asleep.  Japan 
would  not  admit  foreigners,  and  was  steeped  in  the  ways  ot 
philosophy  of  the  dark  ages.  Australia  and  New  Zealand 
were  hardly  known.  India  was  the  India  of  the  mutiny, 
and  knew  little  of  the  great  outside. 

The  chief  trading  on  the  Pacific  then  was  by  sailing 
barques  that  roamed  like  Barbary  pirates.  The  change 
began  to  be  noticeable  about  twenty  five  years  ago.  Cali- 
fornia and  the  other  Pacific  States  became  populated.  trans- 
Pacific  services  were  inaugurated.  Canada  began  to  come 
into  prominence.  All  the  Pacific  countries  found  trade 
with  each  other  becoming  attractive.  In  the  last  fifteen 
years  trans-Pacific  trade  has  developed  twentyfold,  and  we 
are  on  the  threshold  of  an  era  in  which  the  great  ocean  will 
be  the  scene  of  the  world's  great  new  development.  The 
Washington  conference  revolves  chiefly  around  Pacific 
questions,  for  all  the  nations  now  realize  what  mastery  of 
trade  In  that  magnificent  section  of  the  globe  will  mean 
half  a  century  hence.  Canada  has  a  splendid  position  In 
relation  to  the  Pacific,  and  if  we  take  full  advantage  of> 
our  opportunities  there,  should  derive  great  strength  and 
power  in  the  coming  years. 

Our  Present  Showing 

It  must  be  confessed  that,  so  far,  we  have  not  much  to 
show  on  the  Pacific.     Our  total  foreign  trade  on  it  in  1920 


January   6,   1922. 


THF      MONETARY      TIMES 


123 


Western   Homes 

Limited 

WINNIPEG        -        -        MANITOBA 


Cupital  Authorized 
Capital  Subscribed 
Cupital   Paid   Up      - 


$5,000,000 

1,600,000 

425,000 


Established  in  1915  to  meet  the  need  of 
new  sources  of  supply  for  Western  Mort- 
gage Money. 

Funds  Invested  in  gilt-edged  mortgages  on 
improved  farms  and  revenue-bearing  city 
properties. 

A  record  of  careful  management  and  splen- 
did progress  from  inception,  with  regular 
payment  of  half-yearly  dividend  at  the  rate 
of  seven  per  cent,  per  annum.     No  losses. 

Available  shares  of  Western  Homes  offer 
an  excellent  investment  opportunity.  Full 
particulars  upon  application  to 

Argue  Bros.  Ltd. 

Managers 

Ground  Floor,  Confederation  Life  Building 

WINNIPEG,   MAN. 


jiiiniuiiremiiiiiiiDiiuimiiiiiiNj^ii' 


January 
Investments 

Yielding  from  5.80<<^    to  6.50% 


Province  «f  Quebec 

6H 

1936 

Province  of  Ontario 

6 

1943 

City  of  Montreal  (Mais.) 

6 

1952/3 

City  of  Quebec 

5H 

1926 

City  of  Toronto 

6% 

1934/6 

City  of  Toronto 

6 

1937/40 

Montreal  R.C.  Schools 

6 

1931 

Verdun,  P.Q.,  Schools 

6 

1931 

Fort  Garry,  Man. 

6 

1950 

Pay  N.Y. 

St.  Michel  de  Laval,  P.Q. 

6 

1964 

MACKENZIE  &  KINGMAN 

INVESTMENT  BROKERS 
10  St.  John  St.  MONTREAL 


i^iiiM<iiiiiii<iiwii:iiiiiiiiiiijn(iiWi»iinHiiiiiiiiwmuwi!uiiuiinuinimiiiiitimiiiiiiiiJwiiiTi«iiniiui:Bniini; 


THE 


INTERNATIONAL  LOAN 
COMPANY 

GEORGE  W.   ARGUE,   M.D.,   General   Manager. 


Subscribed  Capital 
Authorized  Capital 
Number  of  Shareholders 


$  3,800,000 

$20,000,000 

1,350 


The  International  Loan  Company  is 
seeking  to  save  and  conserve  part  of  the 
current  earnings  of  Manitoba  people  to 
meet  the  requirments  of  Manitoba 
farmers.  In  the  past  six  years  it  has  en- 
listed more  than  thirteen  hundred  share- 
holders. 

All  the  funds  of  the  Company  are  in- 
vested in  first  mortgages,  the  best  se- 
curity in  the  world  with  so  high  a  re- 
turn. 

Have  you  aii.v  money  to  invest  ? 
Write  ns. 


Head  Office 

224  Curry  Building,  Winnipeg 


THE  HAMILTON  PROVIDENT 
AND  LOAN  CORPORATION 

INCORPORATED  IS;  I 

Hamilton      -      Canada 


Paid  up  Capital, 

Reserve  and  Surplus  Profits, 


$1,200,000.00 
$1,315,587.70 


DIRECTORS: 

George  Hope.  President 

Joseph  J.  Greene,  Vice-President 

Col.   Henry  L.  RoberU    William  A.  Wood 

Stanley  Mills  Lt.-Col.   WiUiam   Hendrle 


DEBENTURES     ISSUED 
DEPOSITS      RECEIVED 

Executors  and  Trustees  are  authorized  by  law  to 
Invest  Trust  Funds  In  the  Debentures  and 
Sayings  Department  of  this 
Corporation. 


Office  -  King  and  Hughson  Streets 

D.  M.   CAMEROiN.   General  Manager 


124 


THE       MONETARY       TIMES 


Volume    68 


was  approximately  170,000,000,  out  of  $2,300,000,000.  We 
exported  eleven  millions  worth  of  goods  to  Japan,  and 
bought  six  millions  worth.  We  sold  China  five  millions,  and 
bought  two.  We  sold  Australia  eighteen  millions,  and 
bought  three-fourths  of  a  million.  We  bought  four  mil- 
lions from  New  Zealand  and  sold  her  eleven  millions.  Our 
exports  were  about  50  per  cent  more  than  our  imports. 

This  is  because  Canada  has  manufacturing  industries 
that  are  far  more  efficient  than  Asiatic  or  Australian  in- 
dustries. We  ship  large  quantities  of  paper  to  Australia, 
or  at  least  we  did  until  Australia  gave  British  paper  mak- 
ers a  preference.  We  send  rubber  tires,  confectionery, 
leather,  cotton  goods,  felt,  and  implements  and  machinery 
to  Japan,  China,  the  Australasian  Dominions.  Australia 
recently  put  a  prohibitive  duty  on  agricultural  implements, 
to  compel  the  manufacture  of  these  In  Australia,  and  the 
Massey-Harris  Company,  which  received  about  six  million 
dollars  worth  of  business  there  last  year,  has  been  forced 
to  consider  erecting  an  Australian  factory.  But  notwith- 
standing these  handicaps.  Canada  could  sell  to  customers 
across  the  Pacific  far  more,  if  Canadian  manufacturers 
were  keen  on  ferreting  out  latent  trade  possibilities. 

United  States  Takes  Lead 

The  ships  of  the  Government  Merchant  Marine  are  giv- 
ing a  good  service  ©ut  of  Vancouver,  and  this  regular 
schedule  has  encouraged  many  big  firms  to  investigate 
the  field  much  more  closely.  So  far  outward  bound 
cargoes  have  been  very  fair,  and  incoming  cargoes 
light.  Too  many  Canadian  firms  importing  raw  ma- 
teria! that  comes  from  China  or  Japan,  or  other  Pacific 
source,  go  to  the  United  States  dealers,  paying  far  more 
than  they  would  have  to  pay  by  importing  direct.  In  some 
of  the  Pacific  islands,  regular  auctions  are  held  of  sisal, 
hemp,  and  other  products,  but  never  a  Canadian  buyer 
shows  up.  The  Americans  have  the  control.  But  some 
months   ago   the   Canadian   Prospector,   an    8,390    ton   boat 


brought   nearly    17,000    bales   of   Australian   wool   to   Van- 
couver, and  the  wool  traffic  is  looking  up. 

Captain  Robert  Dollar  asserted  some  time  ago  that  80 
per  cent  of  the  imports  that  pass  through  the  Vancouver 
port  are  destined  for  the  United  States.  Even  in  raw 
silks,  of  which  a  boatload  is  imported  at  a  time,  the  mater- 
ial goes  to  an  American  mill,  and  Canadian  buyers  of  woven 
silk  pay  heavy  duty,  exchaage,  and  freight  to  get  back 
what  passed  through  their  railway  yards.  A  good  deal  of 
Japanese  and  Chinese  tea  that  Canadians  buy  comes  from 
England,  and  travels  all  the  way  around  the  globe  to  get 
here.  Except  for  certain  products.  However,  the  Trans- 
Pacific  market  is  largely  an  export  market,  which  is  what 
Canada  needs  now.  Twice  as  much  tonnage  is  now  offer- 
ing at  Vancouver  as  called  there  before  the  war  scarcity 
of  shipping.  Rates  have  fallen  to  one  fourth  of  what  they 
were.  The  Japanese  financial  crisis  knocked  the  bottom 
out  of  inflated  rates  to  Yokohama  and  Hong  Kong.  The 
Japanese  merchant  marine  is  the  mostly  cheaply  operated 
on  the  Pacific,  and  comes  30  per  cent  under  the  American. 
The  Government  Merchant  Marine  maintains  a  monthly 
service  to  Yokohama,  Kobe,  Hong  Kong,  and  Manila,  a 
coastmg  service  to  San  Francisco  and  San  Diego,  has  five 
freighters  on  the  Australian,  New  Zealand  service,  a  special 
arrangement  for  shipments  to  India,  and  son  will  put  two 
ten  thousand  ton  freighters  on  the  Pacific  service  some- 
where. There  are  other  services,  such  as  the  Canadian 
Pacific,  the  Blue  Funnel,  the  Japanese,  and  companies  op- 
erating a  subsidized  Australian  service.  Taking  it  in  all, 
the  opportunities  exist  for  an  export  business  worth  hund- 
reds of  millions,  instead  of  a  paltry  $40,000,000.  United 
States  and  British  competition  is  keen,  but  the  way  Canada 
has  managed  to  eat  into  the  pie  reveals  much  greater  ap- 
petite, and  ability  to  gratify  it.  Our  Canadian  trade  con- 
sular service  is  good,  and  what  now  is  mainly  required  Is 
more  initiative  by  manufacturers  who  seem  to  think  that 
what  is  so  far  away  necessarily  out  of  reach. 


A  Canadian  Trial  of  the  City  Manager 

Chatham's  New  Plan  Provides  for  November  Voting,  a  Reduced 
Council,  a  Two  Year  Term  for  Mayor  and  Aldermen,  and  a  City 
Manager — Is  An  Adaptation  from  Experience  in  United  States 

BY  VICTOR  liAURISTON 

Chairman    City   Government   Committee, 
Chatham,   Ontario. 


WITH  the  advent  of  1922  the  city  of  Chatham  puts 
into  effect  a  system  of  municipal  government  en- 
tirely new  to  Ontario.  This  system  is  an  adaptation  of 
the  city  manager  or  commission-manager  plan  which  has 
proven  a  remarkable  success  in  the  United  States. 

The  salient  features  of  the  Chatham  plan  may  be  brief- 
ly outlined.  They  are,  November  voting,  a  reduced  coun- 
cil, a  two-year  term  for  mayor  and  aldermen,  and  a  city 
manager.  These  innovations  In  city  government  were 
authorized  by  the  "City  of  Chatham  Act,"  passed  at  the 
1921  session  of  the  Ontario  Legislature. 

So  far  as  the  city  manager  plan  is  concerned,  the  Nov- 
ember voting  is  an  incidental  detail.  Two  strong  argu- 
ments were  urged  in  favor  of  this  change.  It  was  felt  that 
the  counter-atractions  of  the  Christmas  season  militated 
against  intelligent  and  thorough  consideration  of  muni- 
cipal matters,  where  the  election  was  held  immediately 
after  the  Christmas  holidays.  It  was  further  felt  that, 
with  a  council  elected  in  November  to  take  office  in  Jan- 
uary, the  newly  elected  officials  would  have  an  opportunity 
to  get  in  touch  with  municipal  affairs  before  they  were 
required  to  actually  adminster  them. 


The  First  Election 

The  first  election  under  the  new  system  took  place  on 
November  8.  The  City  of  Chatham  Act  provides  for  nom- 
inations the  last  Monday  in  October  and  elections  the  first 
Monday  in  November,  or  on  the  day  following  if  the  first 
Monday  is  a  holiday.  The  term  of  office  actually  begins 
with  the  New  Year. 

Under  the  Chatham  plan,  the  city  council  is  reduced 
from  9  to  7  members,  with  a  mayor,  all  elected  by  general 
vote.  The  term  is  extended  to  two  years;  four  aldermen 
and  the  mayor  being  elected  in  one  year  and  three  alder- 
men in  the  alternate  year.  In  the  recent  election,  of 
course,  seven  aldermen  were  elected;  the  three  polling 
the  lowest  vote  coming  up  for  re-election  in  November, 
1922. 

The  Chatham  plan  also  provides  tor  the  appointment 
of  a  city  manager.  This  will  be  one  of  the  first  tasks  of 
the  newly-elected  council,  when  it  takes  office  in  January. 
This  council  will  fix  the  city  manager's  salary  and  define 
his  duties. 

It  is  premature,  of  course,  to  state  positively  the  exact 
duties  and   powers  which   will   fall   to  the  lot  of  the  city 


January   6,   1922. 


THE      MONETARY      TIMES 


125 


PROVINCE  OF 

SASKATCHEWAN 

Saskatchewan  is  pre-eminently  the  wheat  growing  province  of  Canada,  pro- 
ducing annually  more  than  half  the  wheat  crop  of  the  entire  Dominion,  but 
diversified  farming  is  also  making  rapid  gains;  some  progress  has  been  made 
in  developing  the  province's  vast  natural  resources  of  coal,  clay,  minerals 
and  mineral  salts,  and  the  industrial  development  of  Saskatchewzm  ia  rap- 
idly proceeding. 

AGRICULTURAL  AND  INDUSTRIAL  STATISTICS. 

Va'ue  of  Agricultural  Products  for  19120 $309,610,716 

Live  Stock  : 241,030,755 

Value  of  Manufacturing  Products  for  1918  - - 49,998,136 

Value  of  Forestry  and  Fisheries  for  1920  3,066,737 

Value  of  Mining  Products  for  1920  852,692 

Railway   Mileage , 'v172  miles 


FINANCIAL  REPORT-APRIL  30,  1921 

AHEA— 251,700  square  miles— 101,088,000  acres. 

I'OPL'LATIOX : 

Census    1911    49j,43< 

Dominion    Kstimate    1919    714.000 

Provincial    Ksllmate    1920    833.S«7 

Pl'BLIC    DEBT: 

Oross    Debt    I      45.M1,078.1« 

Les.s  debt  created  for  utilities,  etc.,  whtcb  carry  public  debt  charges  ♦M,65*,347.l0 

SlnkliiiT  I'unds  created  for  the  redemption  of  debt  Incurred    for    purposes    other 

than   utilities,   etc I,44«,4t8.37       25,0«.7«S.4- 


Net    Debt    . 
Debt  |iei-  Capita: 


.t     i0.74i.30«.<a 


Oross  $55.01      Net  $24.89. 


SI.NKINC   FUNDS:    » 

4  per  cent.  Stock  1951   $349,149.30 

4  per  cent.   Debentures  1923    228,025.90 

i%  per  cent.  Slock  1954   92,190.75 

Exchange  Issue  34,370.88 

Patriotic    Aids    482.101.84 

5  per  cent.   Stock  1919   10.708.S5 

General   Slnklns-   Fund    l,477,n7.M 

PROVINCIAL    ASSETS    

Lands  and  llulldlngs  

Public   Iniprovoments   

Utilities   and    Investments    

Cash   in    Haitks    

Sinking    l"un<ls    


2,674.030.86 


.|lS,51t,00«.76 

..  8,0te,406.74 
..  57,568.675.18 
....1,4S5,t3«.«6 
..     1,674.030.86 


REVENUE— For   Hscal  year   1920-21    % 

liainiTUoit   Subsidy $1,753,075.00 

EXPEM)1TUKE— For  fl.sc«I  year  1920-21    


83,33SJM.aO 


U,78a.»ttL« 


151,666.38 


PKOVINCIAL   RAILWAY   GUARANTEES    28,58S,0n.» 

The  Canadian  .Northern  iiailwav  iRuarantee  »l5.;!70.879.'.".i  is  now  part  of  the  Canadian  National  Hall- 
ways; The  Grand  Trunk  Pacinc  Branch  Lines  (guarantee  $13,711,132.00)  are  also  being  acquired 
by  "the   Dominion   Government. 


GUARANTEES— Given   in   advancement   of   Agricultural   Interests    

EiTIMATED    ASSESSABLE    VALUE   OF    ALL    PROPERTY   WITHIN    THE    PROVINCE 


2.2S4.443.50 

.$t.sao.ooo.oooiso 


126 


THE      MONETARY      TIMES 


Volume    68 


manager.  But  the  intention  is  that  he  will  function  much 
the  same  as  the  general  manager  of  a  large  business.  The 
mayor  and  aldermen  will  act  as  directors,  determining  the 
general  policies  of  the  municipality;  while  the  execution 
of  those  policies  will  be  entrusted  to  the  manager,  who  will 
be  held  responsible  for  securing  results. 

New   Ideas   in   City   Govemment 

One  of  the  most  frequent  arguments  against  the  city 
manager  plan  is  that  it  is  American  In  its  origin,  hence 
not  for  one  moment  to  be  considered  by  patriotic 
Canadians. 

It  is  true  the  city  manager  plan  has  made  great  ad- 
vances in  the  United  States;  but  it  has  arisen  as  a  correct- 
ive to  the  practical  weaknesses  of  the  Jeffersonian  democ- 
racy. The  American  of  a  century  ago  took  pride  in  his 
elaborate  system  of  "checks  and  balances"  which  made 
autocracy  impossible;  and  in  his  plan  of  electing  oificials 
of  all  sorts  by  popular  vote,  thereby  ensuring,  as  he 
thougt,    complete    democratic    control    of    the    government. 

The  Jeffersonian  principle  of  electing  all  civic  officials, 
both  legislative  and  executive,  in  the  end  defeated  Its  own 
purpose.  The  usual  defects  of  the  American  municipal 
systems  were: 

(a)  The  average  elector,  required  to  vote  upon  a  host 
of  candidates  for  a  wide  variety  of  municipal  offices,  was 
in  no  position  to  intelligently  select  the  most  capable  men. 
He  could  not  know  all  the  candidates  so  intimately  as  to 
judge  their  fitness,  particularly  for  executive  positions 
that  required  technical  knowledge  and  experience. 

(b)  The  tendency  to  run  municipal  elections  upon 
federal  party  lines,  and  the  introduction  of  party  emblems 
on  the  ballot,  led  the  overwhelming  majority  of  voters  to 
chose  their  mayor,  aldermen  and  ether  elective  officials, 
not  according  to  fitness,  but  according  to  party  allegiance. 
Thus,  too,  the  nominees  were  first  selected,  not  for  fitness 
to  handle  municipal  business,  but  by  party  conventions 
and  political  bossesi 

(c)  The  ward  system  filled  the  councils  with  men 
chosen  for  local  popularity  or  influence,  who,  far  from  re- 
garding the  interests  of  the  community  as  a  whole,  indulg- 
ed in  peanut  politics  and  municipal  log-rolling  and  were 
not  concerned  with  the  interests  of  any  other  ward  or  pre- 
cinct so  long  as  they  could  make  themselves  solid  with 
their  own. 

Out  of  these  conditions  there  developed  a  state  of 
affairs  that,  twenty  years  or  more  ago,  attracted  wide- 
spread attention,  and  gave  the  muckrakers  plenty  of  work. 
A  large  proportion  of  American  communities  suffered 
from  the  double  waste  involved  in  graft  and  corruption  on 
the  one  hand  and  carelessness  and  inefficiency  on  the  other. 

The  basic  weakness  in  American  municipal  govern- 
ment was,  that  the  then  existing  systems  made  it  easy  for 
the  political  boss  to  wrest  control  from  the  people,  and  dif- 
ficult for  the  electors  to  get. rid  of  the  boss. 

The    Short    Ballot 

The  plan  of  a  small  elective  council,  chosen  by  general 
vote,  struck  direct  at  the  basic  evils  in  the  American 
municipal  system.  Municipal  reform,  in  commission-gov- 
erned and  city  manager  communities,  reduced  the  elective 
officials  to  seven,  five  or  even  three,  usually  termed  com- 
missioners. More  than  that,  the  term  of  office  was  extend- 
ed to  two,  three  or  four  years,  with  elections  every  year. 

Thus  the  elector  who  under  the  old  system  was  handed 
a  long  ballot  with  the  names  of  hundreds  of  candidates 
for  scores  of  offices,  under  the  commission  or  city  manager 
plan  was  asked  to  select  the  best  one  or  two  men  out  of 
a  possible  four  or  five  candidates.  Nor,  under  the  new 
system,  were  there  any  party  emblems  on  the  ballot  to 
distract  attention  from  the  merits  of  the  men  themselves. 

They  had  to  be  capable  men,  even  if  they  were  par- 
tizans;  otherwise  they  could  not  command  the  confidence 
or  grip  the  attention  of  an  entire  community. 

Under  this  new  system,  was  the  elector  in  a  position  to 
vote  more  intelligently,  to  pick  better  men  for  public  of- 
fice, to  secure  better  results  for  the  community — which,  in 
the  last  analysis  means,  for  himself? 


Experience  of  the  past  two  decades  answers  that  ques- 
tion. The  short  ballot  has  given  American  communities 
the  sort  of  elective  rulers  capable  of  handling  affairs  hon- 
estly and  efficiently,  of  laying  down  intelligent  municipal 
policies  for  the  guidance  of  their  executive  ofTxials,  and  ot 
courageously  supporting  those  officials  in  their  efforts  to 
make  good.  That  is  why  in  particular  the  city  manager 
system  has  made  good,  and  why  not  one  of  the  150  or 
more  communities  holding  city  manager  charters  has  ever 
gone  back  on  the  system. 

Many  people  who  have  not  studied  the  municipal  de- 
velopments of  the  last  20  years  in  the  United  States  have- 
vague  ideas  as  to  what  the  "commission  plan"  and  the 
"city  manager  plan"  actually  are.  There  is  a  tendency 
to  regard  the  two  systems  as  identical;  whereas  they  are 
decidedly  dissimlar,  though  both  are  improvements  upon 
older  methods. 

The    Galveston    Idea 

On  September  8,  1900,  a  hurricane  sweeping  from  the 
southeast  drove  the  waters  of  the  Gulf  of  Mexico  in  a  huge 
tidal  wave  over  the  city  of  Galveston,  Texas.  The  result- 
ant disaster  marked  the  climax  of  many  years  of  muni- 
cipal inefficiency.  In  the  crisis  the  city  government  failed 
utterly;  and  it  was  left  for  the  Deepwater  Commission, 
an  organization  of  business  men,  to  take  charge  of  the 
work  of  relief  and  reconstruction. 

So  well  did  this  commission  handle  affairs  in  the  emer- 
gency that  a  new  charter  was  sought  whose  aim  was  to 
provide  an  inexpensive  and  efficient  form  of  city  govern- 
ment. This  charter  replaced  the  mayor  and  council  with 
a  commission  of  five  members,  elected  by  general  vote, 
and  having  complete  control  of  civic  affaips. 

One  of  the  commissioners,  styled  the  mayor-president, 
has  general  oversight  of  all  the  city's  business.  Of  the 
other  four,  one  has  charge  of  the  police  and  fire  depart- 
ment, one  is  commissioner  of  streets  and  public  property; 
the  third  is  waterworks  and  sewage  commissioner;  and 
the  fourth   is  commissioner  of  finance  and  revenue. 

The  conamission  by  majority  vote  determines  which 
man  shall  be  head  of  each  department.  Thus  the  five 
commissioners  correspond,  in  many  respects,  to  a  general 
manager  and  four  assistant  managers,  each  having  special 
charge  of  some  specific  division.  As  a  group  the  commis- 
sion functions  as  a  board  of  directors,  determining  the 
general  policy  of  the  city. 

Thus,  the  commission  plan  combined  in  the  one  set  of 
elective  officials  both  legislative  and  executive  functions. 
It  had  the  great  advantage  that  there  could  be  no  side- 
stepping of  responsibility,  no  "passing  the  buck."  The 
public  knew  who  was  responsible  for  each  department; 
and  the  public  knew  also  that  these  five  men  were  respon- 
sible for  the  city  as  a  whole. 

The  Galveston  idea  attracted  a  great  deal  of  atten- 
tion. It  unquestionably  worked  wonders,  particularly  in 
contract  with  the  cumbrous,  complicated  and  inefficient 
system  that  had  preceded  it.  These  good  •  results  may 
have  been  due  in  part  to  the  aroused  patriotism  of  the 
citizens.  But  at  the  time  the  Galveston  system  was  much 
discussed,  it  was  subsequently  copied  in  many  American 
communities,  and  "government  by  commission"  became 
a   popular   watchword. 

It  did  not,  however,  avoid  the  weakness,  common  to 
most  American  municipal  systems,  of  entrusting  executive 
work  to  men  totally  lacking  in  technical  experience.  There 
could  be  no  certainty  that  the  five  men  elected  by  popular 
vote  would  meet  the  requirements  of  the  five  specific 
departments   they   were  to  handle. 

The    Dayton    Improvement 

Eight  years  later  the  little  city  of  Staunton,  Virginia, 
generated  the  nucleus  of  the  city  manager  plan,  when  it 
passed  a  municipal  ordinance  providing  for  th»  appoint- 
ment of  a  city  manager.  The  Staunton  plan,  however, 
kept  the  old  municipal  machinery  as  it  was.  It  was  not 
till  the  disastrous  Ohio  floods  swept  over  the  city  of  Day- 
ton in  the  spring  of  1913  that  the  city  manager  plan  leapt 
into  prominence. 

Dayton    had   been   ine....ciently   if   not   dishonestly   gov- 


January  6,  1922. 


THE      MONETARY      TIMES 


UT 


R  E  G  I  N  A 


THE    CAPITAL    OF   SASKATCHEWAN    AND    THE 

FINANCIAL  AND  DISTRIBUTING  CENTRE 

OF  THE  MIDDLE  WEST. 


To  Manufacturers  &  Wholesalers  : 


Gentlemen: 


Re:      Advantages  of    Regina    as   a    Distributing    Centre. 


Saskatchewan  is  one  of  ttie  most  important  markets  in  Canada  for  manufactured 
goods,   and  the  City  of  Regina,   served  by  three   transcontinental   railway  systems  and 
numerous  branch  lines,    offers  unrivalled   facilities  for  the  distribution  of  merchandise  in 
the  Middle  West. 

During  the  years  of  the  war  and  the    unsettled  conditions  which   followed   every- 
where,   Regina  maintained   its  record   for  steady,  solid  growth,  as  indicated  in  the 
following  figures: 


Value  of  all  buildings    (ba-sed  on  assessment) 

191 1    .., $  9,188,785.00 

1914  24,201,333.00 

1921    34,602,633.00 

Post  Office  Money  Orders 

Issued  Paid 

1911    $513,582. .34  $    592,755.11 

1914  609,430.53  1,193,274.53 

1920  , 971,253.04  9,667,752.81 


Bank  Clearings 

1911   $  73,032,088.00 

1914   98,206,641.00 

1920   231,070,268.00 

Customs  Returns 


1911 9  648,243.40 

1914 997.124.89 

1921   2,985.740.65 


(1914  business  was  adversely  affected  by  the  declaration  of  war  in  August  of  that  year.) 

The  volume  of  business  and   excellent   railway  service  are  the  best  guarantee 
to  the  individual  shipper  that  he  will  be  able    to  secure  supplies  and  make  prompt 
deliveries  to  his  customers  in  every  part  of  the  province. 

The  Street  Railway,  Light  &  Power  Plant,  and  Waterworks  are  municipally  owned 
and  operated;      and   have  proven  valuable  investments  to  the  community  from  a  service 
standpoint;      and,   taken  together,   not   only  pay  their  own  way  but  contribute  to  the 
general  revenues  of  the  City  . 

After  its  railway  facilities,  the  most  important  single  factor  in  the  development 
of  Regina  as  an  industrial  and  distributing  centre  and  in  the  success  of  the  businesses 
located  here,  is  the  specially  -planned  and  developed  industrial  area.  Three  hundred 
acres  of  the  original  town  site,  three  blocks  from  the  centre  of  the  down  town  business 
and  the  financial  centre,  are  reserved  and  developed  for  wholesale  and  memufacturing 
purposes.  Provision  is  made  for  spur  track  accommodation  to  each  site.  Sewer,  water, 
power,  street  railway,  pavements  and  walks  are  available  throughout  the  area,  and  the 
freight   depots  of   the   railway   companies  are   convenient  to  it. 

Kealizing  the  importance  of  this  asset,  the  City  has  exercised  the  greatest  care  in  the  sale  of  this 
Iiroperty  to  ensure  that  it  will  be  used  only  for  Industrial  purposes  and  not  for  speculation.    Over 
half  in  value  of  the  area,  representing  7  miles  of  spur  track  frontage,  has  been  sold  and  is  in  use  for 
manufacturing  and   warehouse  purposes.     The  City  has  still  about  6  miles  of  spur  track  frontage  for 
sale  to  bona  flde  businesses  at  satisfactory  prices. 

To  the  manufacturer  or  wholesaler  who  desires    to    supply    Saskatchewan's   demand    for    mann- 
factured  goods.  Regina  offers  unrivalled  facilities  for  the  distribution  of  merchandise;  and  the  City 
Commissioners  will  be  glad  to  give  special  consideration  to  the  requirements  of  any  business  as  to 
site,  etc.,  or  furnish  more  detailed  information  upon   request. 

Yours  truly. 


}?i, 


City   Commissioner. 


128 


THE       MONETARY       TIMES 


Volume     68 


erned  under  the  old  system.  "Government  by  deficit"  was 
the  order  of  the  day.  In  six  years  the  aggregate  deficit 
amounted  to  $360,000;  in  1912  alone  the  deficit  was 
$108,300.  From  1903  to  1913  the  per  capita  debt  showed 
an  Increase  ot  76  per  cent.  The  city  was  kept  going  by 
Issuing  bonds.  Bonds  spread  over  15  or  2  0  years  were  Is- 
sued to  pay  for  "improvements"  whose  estimated  life  was 
5  years  or  less;  as  these  fell  due,  they  were  met  by  the 
Issue  of  new  bonds;  and  bonds  were  issued  even  to  meet 
current  operating  expenses.  In  1913  some  47  per  cent  of 
the  total  tax  income  of  the  city  was  spent  in  liquidation 
of  current  bonds  and   obligations. 

"What  Dayton  needs  is  a  receiver  instead  of  a  man- 
ager," said  the  man  who  ultimately  brought  order  out  of 
this   financial   chaos. 

It  was  the  flood  that  precipitated  the  new  order  in 
Dayton.  That  flood  did  more  than  wipe  out  lives  and 
destroy  property;  it  swept  away  a  corrupt  and  incom- 
petent municipal  regime.  The  Ohio  city,  rising  from  its 
wreckage,  determined  on  a  new -order.  It  would  be  run 
as  a  business  enterprise,  according  to  modern  business 
methods. 

The  new  civic  charter  established  the  commission- 
manager  or  city  manager  system.  Under  this  system  the 
citizens  elect  five  men  to  serve  as  commissioners.  These 
serve  without  pay,  and  function  as  a  board  of  directors. 
They  have  power  at  any  time  to  "hire  or  fire"  the  city 
manager.  The  latter  is  the  business  manager  of  the  city's 
affairs,  carrying  out  the  policies  determined  on  by  the 
commission,  appointing  and  supervising  the  department 
heads,  and  functioning  in  the  same  way  as  the  general 
manager  of  any  large  business. 

Thus  the  difference  between  the  Galveston  commission 
system  and  the  Dayton  city  manager  plan  define  them- 
selves very  simply  under  the  Galveston  commission 
system  each  commissioner  is  a  department  head;  indiv- 
idually each  commissioner  is  an  executive  and  asa  whole 
they  are  legislators  or  directors.  Under  the  Dayton  city 
manager  plan  the  commissioners  are  directors,  doing  all 
the  legislating  and  shaping  the  general  municipal  policies; 
while  the  executive  work  is  placed  solely  in  the  hands  of 
the  manager. 

For  counsel,  many  kinds  are  needed;  for  execution  a 
single  directing  head  is  required.  The  advantage  of  a 
generalissimo  were  clearly  illustrated  in  the  recent  war, 
in  the  case  of  Marshall  Foch;  but  Dayton  had  already, 
years  before,  worked  out  the  same  principle  in  a  different 
field  of  disaster. 

Dayton  set  an  important  precedent  by  offering  General 
Goethals,  of  Panama  fame,  $25,000  a  year  to  take  the 
post  of  city  manager.  Goethals  declined;  but  Henry  M. 
Waite,  city  engineer  of  Cincinnati,  ultimately  was  secured. 
Under  his  regime  the  municipal  business  was  completely 
reorganized.  The  city  paid  its  way,  fioating  debts  were 
wiped  out,  operating  costs  were  reduced,  public  services 
were  put  on  an  efficient  basis.  The  contract  between  the 
Dayton  of  1912  and  the  Dayton  of  even  1914  or  1915 — to 
say  nothing  of  the  Dayton  of  1921 — has  been  remarkable. 

The  "Dayton  plan"  was  copied  in  many  parts  of  the 
United  States.  There  were  variations,  of  course,  in  local 
conditions;  but  the  plan  worked  equally  well  in  small 
places  like  Hickory.  N.C.  and  Blackstone,  Va.,  and  large 
cities  like  Dayton,  Ohio,  Grand  Rapids,  Mich,  and  Wichita, 
Kansas.  Details  in  the  charters  varied  somewhat.  In 
some  states  special  legislation  provided  charters  for  in- 
dividual  communities;  in  others  general  enabling  acts 
permitted  a  community  of  its  own  initiative  to  adopt  a 
specified  system.  The  number  of  commissioners  varied 
from  3  to  7. 

At  last  reports,  upwards  of  150  communities  in  the 
United  States  had  adopted  the  Dayton  plan.  In  the  choice 
of  a  city  manager  the  Dayton  precedent  has  been  gener- 
ally followed,  of  securing  an  outside  man,  preferably  an 
engineer  by  profession,  and  getting  the  best  man  the  com- 
munity  could  afford. 

Canadian    Conditions 

In  adapting  such  a  plan  to  an  Ontario  community,  the 


basic  difference  in  pre-existing  conditions  must  be  con- 
sidered. Most  of  our  small  cities  already  have  an  approx- 
imation of  the  short  ballot,  having  done  away  with  their 
unwieldly  ward  councils  and  come  to  elect  their  aldermen 
by  general  vote.  Graft  has  never  been  a  serious  munici- 
pal problem,  and,  as  a  rule,  party  politics  carry  little 
weight  in  municipal  elections, -except  when  these  syn- 
chronize with  federal  or  provincial  contests.  Thus  the 
three  basic  evils  of  the  old  American  municipal  system 
have  not   seriously   touched   us. 

What  has  affected  us  injuriously  has  been  the  lack  of 
continuity  in  municipal  policies.  With  the  one  year  term, 
a  promising  alderman  no  sooner  familiarizes  himself  with 
civic  affairs  than  he  has  to  go  back  to  the  electorate. 

We  have  repeatedly  witnessed  the  phenomenon  ot  first 
class  men  taking  civic  office  with  much  enthusiasm,  and 
quitting  at  the  end  of  a  year.  We  have  experienced,  too, 
the  difficulty  of  drumming  up  sufficient  men  to  fill  all  the 
civic  offices.  Again,  a  man  inaugurates  some  policy  of 
civic  betterment;  he  carries  on  efficiently  during  his  two, 
three  or  four  years  in  municipal  life;  then  he  drops  out 
and  indifferent  men  succeed  him  and  the  effort  he  has 
put  forth   is  largely  lost. 

Then,  too,  there  is  lack  of  co-ordination  between  civic 
committees,  and  between  the  city  council  and  the  other 
civic  bodies,  such  as  the  school  board,  the  water  board, 
public  utilities  commission,  parks  commission,  and  the 
like.  The  result  is  considerable  overlapping  of  authority, 
much  duplication  of  effort  and  expense,  some  actual  money 
loss  to  the  community,  and,  in  many  instances,  very  un- 
satisfactory service.  The  lack  of  a  centralized  executive 
is  responsible  for  a  great  part  of  our  too  high   tax  rates. 

For  municipal  efficiency  there  must  be  continuity  of 
civic  effort,  there  must  be  co-ordination  of  civic  effort,  and 
there  must  be  a  centralized  executive  in  close  and  constant 
touch  with  every  department  in  order  to  produce  that 
co-ordination.  Great  private  enterprises  are  eflScient  be- 
cause they  have  such  executives;  and  municipal  business 
is  eflScient  where — as  in  the  city  manager  community —  a 
similar   executive   is   provided. 

Yet  with  the  city  manager  system  there  is  at  the  same 
time,  through  the  elective  commission  or  council,  complete 
democratic  control   of   municipal   affairs. 

Canadian    City    Managers 

The  city  manager  system  was  less  needed  in  Canada 
than  in  the  United  States,  and  has,  consequently,  been 
slower  to  take  root  here.  Canadian  legislators  have  also 
been  conservative  in  regard  to  municipal  innovations. 
Nevertheless,  the  system  had,  before  Chatham  took  it  up, 
been  already  adopted  in  one  New  Brunswick  communi*^- 
two  in  Quebec,  and  (in  modified  form)  one  in  Ontario.  In 
the  latter,  Guelph,  the  system  is  radically  different  in 
many  ways   from   the  Dayton   plan. 

Thus,  in  Guelph,  instead  of  a  small  commission,  elected 
by  general  vote,  provision  was  made  for  a  council  of  18, 
three  from  each  ward.  The  term  is  three  years,  so  that 
one  alderman  is  elected  annually  from  each  ward.  The 
Council  elect  the  mayor  from  their  own  number,  an  idea 
not  wholly  popular,  from  what  I  can  gather.  The  city 
manager  is  also  city  clerk.  Guelph  had,  in  1920,  the  low- 
est tax  rate  among  Ontario  cities,  per  capita  assessment 
considered;  so  that,  even  in  this  radically  different  form, 
the   city   manager  system   seems  to  be   working. 

In  Woodstock,  N.  B.  the  city  manager  sysiem  inaugera- 
ted  late  in  1919.  R.  F.  Armstrong,  an  engineer  by  pro- 
fession, is  city  manager  at  a  salary  of  $3,000  a  year.  The 
water  department  was  put  on  a  paying  basis,  municipal  ser- 
vices generally  improved,  and  a  high  degree  of  efficiency 
secured;  and  at  the  end  of  the  second  year,  1920,  the  de- 
ficit of  the  previous  year  had  given  place  to  a  surplus. 

In  the  province  of  Quebec,  Westmount  and  Outremont 
are  city  manager  communities.  In  these,  special  legisla- 
tion was  not  required,  the  office  of  the  city  manager  be- 
ing created  by  municipal  bylaw.  Westmount  cites  two  ad- 
vantages of  the  system: 

"1.  The  plan  secured  for  the  municipality  the  co-oper- 
ation   of    all    the    administrative    departments    under    the 


January   6,   1922.  THEMONETARYTIMES  1» 


I 


I 


Why  The  Province  of 

MANITOBA 

Maintains   An  Unimpaired  Credit 


The  Province  of  Manitoba  hais  in  its  own  treasury  in  bonds  and  vm-. 
expended  capital  money  a  total  sum  of  $14,795,000  (November,  1921 ),  this 
being  equal  to  23%  of  the  gross  debt  of  the  Province.  In  this  respect  Mani- 
toba stands  unique  among  the  Provinces  of  Canada. 

Note  how  tills  affects  the  flnancial  standing  of  the  Province: 

The  gross  debt  of  the  Province  is  $63,400,000   (November,  1921). 

Of  this  amount  $37,000,000  is  invested  in  self-sustaining  public  enterprises  such 
as  Government  Telephones,  The  Manitoba  Farm  Loans  Association,  The  Hydro- 
Electi-ir  ('ommission,  etc. 

The  net  debt  is  therefore  $26,400,000,  investe<l  In  permanent  substantial  and 
beautiful  public  buildings,  good  ronds,  etc.  Approximately  $14,000,000  of  this  anioum 
is  represented  In  the  niagiiitU'cnt  New  Parliament  Buildings,  the  New  Ijaw  Courts 
and  the  Agricultural  College. 

It  will  be  se<!n  that  should  the  Government  dtnide  to  do  so,  it  «'uul<l  at  one  >tr«>ke 
reduce  the  debt  of  the  Province  by  $14,795,000  by  simply  dLsi>osing  of  the  securities 
held  in  tlie  treasury  together  with  the  cash  unexpended.  No  other  Province  is  in 
this  position,  and  this  is  one  of  the  reasons  why  the  credit  of  fttanitoba  is  so  fully 
maintained. 

Another  reason  is  to  be  found  In  the  provision  that  all  monies  receive<I  from  the 
sale  or  other  disposition  of  provincial  lands  or  any  other  assets  or  re«!ourc«v<  of  the 
Province  must  be  tre«t«'<l  as  capital  funds  to  Ih>  invested  at  Interest  or  ust>d  strictly 
for  capital  expenditure  or  in  reduction  of  the  capital  debt  of  the  Province.  No  part 
of  any  such  monies  may  be  used  for  ordinary  oxiH-ndituro. 


f 


!iiiiiiiiiiiiiiiiiiiiiiiiiiiniiiiwiiiiiiiiiiiiiiiiuiiiiiiiiiiiiiiiyiiiiiiiiiiiiiiiHiiiiiiiiiiiiiiii^ 


130 


THE      MONETARY      TIMES 


Volume    68 


direct  supervision  of  one  official.  The  results  are  inev- 
itably more  advantageous  expenditure  of  money  and  great- 
er efficiency  in  the  work  of  all  the  departments. 

"2.  The  city  manager  plan  relieves  the  commission- 
ers or  aldermen  from  details  of  administrative  work  and 
supervision,  and  thus  gives  them  the  time  so  saved  for 
devotion   to  service   of  a   legislative   character." 

Outremont,  Que.,  where  the  system  has  been  in  force 
since  September,  1918,  elects  nine  aldermen  for  a  three 
year  term,  one  alderman  from  each  of  three  wards  each 
year.  The  mayor,  also  holding  office  three  years,  is  elect- 
ed by  general  vote.  The  city  manager,  who  also  serves 
as  city  engineer,  receives  $6,000  a  year.  The  council, 
composed  of  business  of  high  calibre,  gives  the  manager, 
J.  A.  Duchastel,  B.A.Sc,  an  absolutely  free  hand  in  ad- 
ministrative matters;  with  the  result  that  efficiency  in  the 
municipal  services  has  been  greatly  increased,  while  fol- 
lowing a   consistent   policy   of   economy. 

Competent  and  impartial  authorities  rate  these  two 
Quebec  cities  among   the  best  managed   in   Canada. 

How  Chatham  Did  It 

Westmount  and  Outremont  created  the  office  of  city 
manager  by  resolution  or  bylaw  of  the  existing  council. 
In  Woodstock,  N.B.  a  special  act  of  the  provincial  legis- 
lature provided  tor  the  change,  which  included  a  smaller 
town  council.'  In  Guelph  a  special  act  of  the  legislature 
provided  for  its  new  plan,  which,  as  has  been  noticed,  is 
radically  different  from  the  city  manager  plan  as  adopted 
in  most  communities. 

The  constitution  of  the  office  of  city  manager  and  the 
appointment  of  such  an  officer  are,  probably,  quite  within 
the  powers  of  any  Ontario  municipality.  Nothing  in  the 
Municipal  Act  either  specifically  authorizes  or  specifically 
forbids  such  a  step. 

In  Chatham,  the  success  of  the  Galveston  experiment, 
resulted,  some  10  or  12  years  ago,  in  a  strong  sentiment 
in  favor  of  commission  government,  based,  however,  less 
on  intelligent  understanding  of  the  new  system  than  on 
dissatisfaction  with  older  methods.  The  city  council  at 
that  time,  however,  rejected  a  motion  to  submit  a  com- 
mission plan  to  the  electors. 

In  the  fall  of  1918  the  agitation  for  a  change  was  re- 
vived, and  received  strong  support  from  the  local  press. 
W.  A.  Hammond,  mayor  for  1919,  in  his  inaugural  address, 
urged  a  special  committee  to  investigate  the  subject.  At 
that  time  the  commission  plan  was  under  consideration; 
but  the  special  committee,  headed  by  i^l^erman  J.  G.  Clark, 
and  with  which  the  writer  was  informally  associated, 
decided,  after  some  investigation,  that  the  city  manager 
plan  was  better  suited  to  a  community  such  as  Chatham. 
Consequently,  the  committee  recommended  the  city  man- 
ager system,  with  a  smaller  elective  council. 

In  the  1920  elections  a  general  proposal  thus  outlined 
was  submitted  to  the  people  and  carried  2  to  1.  That 
year  a  second  committee,  headed  by  Alderman  Murray 
Reeve,  worked  out  the  details  of  the  plan  ultimately  ad- 
opted. This  plan,  voted  on  in  January,  1921,  carried  3 
to  1.  With  this  backing  the  city  government  committee 
of  1921,  of  which  the  writer  was  chairman,  presented  the 
City  of  Chatham  Bill  to  the  Ontario  Legislature,  and  duly 
secured  the  approval  of  that  body. 

I  do  not  present  the  Chatham  plan  as  ideal  in  all  its 
details.  Many  thinking  men  would,  with  good  reason, 
prefer  a  council  of  5  to  a  council  of  7;  the  latter  was,  pre- 
sumably, modeled  on  the  Michigan  system.  The  original 
proposal  inferentially  placed  the  waterworks  and  the 
hydro  electric  system  under  the  city  manager's  jurisdic- 
tion; but  in  deference  to  the  views  of  the  private  bills 
committee,  these  departments  were  specifically  excluded 
in  the  act  as  finally  passed.  I  am  frank  in  saying  the 
waterworks,  at  least,  should  have  been  inciuded.  The 
schools  are,  as  1  think  they  should  be,  under  a  distinct 
and  separate  authority,  in  the  board  of  education,  though 
the  average  Ontario  community  would  in  most  cases  ben- 
efit by  closer  co-operation  between  the  school  and  general 
authorities,  at  least  in  financial  matters.     An  election  the 


first  Monday  in  December  might  well  accomplish  the  same 
results  as  an  election  a  month  earlier;  and  the  mayor 
might  better  be  elected  in  the  same  year  as  the  smaller 
number   of   aldermen. 

These,  however,  are  minor  details,  all  capable  of  coi- 
rection  should  the  need  for  correction  become  evident. 
The  Chatham  plan  embodies  the  vital  principles  that  have 
made  the  city  manager  system  a  success  In  so  many  com- 
munities— a  smaller  municipal  council,  elected  by  general 
vote  in  alternative  years  for  a  two  year  term,  thus  pro- 
viding the  maximun  of  intelligent  control  by  the  elector- 
ate; and  a  city  manager,  as  a  centralized  executive,  ensur- 
ing the  maximum  of  efficiency.  The  human  factor  is  still 
to  be  tested;  but  Chatham's  citizenship  is  as  intelligent 
and  patriotic  as  any. 


CANADA  STEAMSHIPS  TRAFFIC 


Notwithstanding  that  lessened  traffic  from  the  other 
side  of  the  Atlantic  and  from  the  United  States  affected 
transportation  on  the  Great  Lakes  of  Canada  and  on  the 
St.  Lawrence,  the  passenger  traffic  season  which  has  just 
closed  for  the  Canada  Steamship  Lines,  Limited,  has  been 
in  many  ways  a  successful  one.  Such  is  the  statement 
made  by  Mr.  John  F.  Pierce,  passenger  traffic  manager 
for  the  company. 

', Traffic  started  early  in  June,"  said  Mr.  Pierce,  "and 
was  consistently  good  right  up  to  the  end  of  the  regular 
season,  so  much  so  that  the  company  decided  to  extend 
its  Toronto,  Thousand  Islands  and  Montreal  service  an 
extra  week  to  September  26.  Thaffic  on  the  Great  Lakes 
and  Northern  Navigation  division  was  heavier  than  in 
1920,  w'hich  was  a  banner  year.  Traffic  between  Toronto 
and  Montreal  was  within  ten  per  cent,  of  1920,  and  from 
Montreal  eastwards  within  five  per  cent.  On  a  general 
average  travel  was  within  seven  per  cent,  of  the  stand- 
ard of  the  record  season  of  1920,  and  at  the  same  tifiie 
involved  much  smaller  operating  expenses,  so  that  in  all 
likelihood  the  season  will  be  found  to  have  been  the  most 
satisfactory  from  the  earning  point  of  view  in  the  history 
of  the  company. 

What  small  decrease  there  was  in  traffic  was  from  the 
United  States  and  Great  Britain." 


ESSEX  COUNTY  TOBACCO  CROP 


According  to  estimates  made  by  Government  author- 
ities, there  was  a  great  decrease  in  the  acreage  of 
tobacco  in  Essex  County,  Ontario,  in  1921,  as  compared 
to  last.  Last  year  it  was  estimated  that  the  total  acreage 
of  flue-cured  or  Virginia  tobacco  in  the  county  was  in 
the  neighborhood  of  3,000  acres,  while  the  acreage  for 
1921  was  only  about  1,900  acres.  The  great  decrease  in 
the  acreage  and  the  better  quality  of  tobacco  this  year 
should  have  a  tendency  to  increase  the  price  of  tobacco. 
Last  year  the  price  of  flue-cured  tobacco  was  about  30 
cents  a  pound,  and  many  crops  bringing  less  than  that 
from  the  tobacco  companies.  The  acreage  of  the  hurley 
crop  has  also  suifered  a  severe  drop  this  year,  being  over 
3,000  acres  less  than  last  year.  Similar  decreases  are 
reported  in  other  counties,  making  the  total  acreage  of 
the  various  varieties  of  tobacco  much  less  than  in  1920. 


AliBERTA  WOOL  SHIPMENTS 


Alberta  during  1921  shipped  nearly  2,000,000  pounds 
of  wool,  most  of  which  has  been  bought  by  Canadian 
mills,  according  to  J.  W.  Renton,  vice-president  of  the 
Co-operative  Wool  Co.  The  actual  figures  of  shipments 
to  date  amount  to  1,927,761  pounds,  and  it  is  estimated 
that  250,000  pounds  of  wool  remain  in  the  hands  of 
growers,  in  small  lots.  The  price  has  been  about  the 
same  throughout  the  season  and  varies  from  10  cents  for 
coarse  wool  to  25  cents  for  the  finer  grades.  There  has 
been  a  constant  demand  for  medium  and  fine  grades. 


lanuai-y 


WM.   MAKTIN 


8.  P.  CLARK 


Clark  &  Martin 

STOCK    &    BOND    BROKERS 

Direct    Private   Wire   New   York,   Chicago, 
Montreal,  Toronto 

Members 
Winnipeg   Grain    Exchange 
Chicago    Board    of    Trade 
Winnipeg   Stocit    Exchange 


Correspondents — 

LOGAN  &  BBVAN,  GREENSHIELDS  &  CO., 

\ew  York.  Montreal. 


Huron  and  Erie  Building 

232  Portage  Avenue    -     WINNIPEG,  MAN. 


St.Cyr.,Goiithier&Frigon 

INVESTMENT  BANKERS 


MUNICIPAL  AND 
SCHOOL  DEBENTURES 

OF  THE 
PROVINCE  OF  QUEBEC 


103   St.   Francois   Xavier  Street 

MONTREAL 


THE    CANADIAN   APPRAISAL 
COMPANY,  LIMITED. 

THE  PIONEER  APPRAISAL  ORGANISATION    OF    CANADA 

ESTABIJHHEn    1905 

During  the  past  fifteen  years  we  have  appraised  some  FIVE  THOUSAND 
properties   wtihin   the   Dominion   of  Canada. 

These  include  over  One  Thousand  Bank  Premises,  scattered  throughout  the 
country  from  Newfoundland  to  British  Columbia,  as  well  as  the  most  rep- 
resentative   industrial    propertied    in    every  line  of  industry. 

Cortesponde   ce   Invited. 

HEAD  OFFICE  :  364,  University  Street,  MONTREAL 


TORONTO:    Royal  Bank  Building. 


NEW  YORK:    Equitable  Building. 


132 


THE       MONETARY      TIMES 


Volume     68 


Western  Oil  Results  Have  Been  Disappointing 

Imperial  Oil  Company  Has  Met  With   Little  Success  Thus  Far, 
While  Other   Companies  Have  Done  Even   Less — Dividends  For 
Shareholders      Are      Far-off      and      in      Some      Cases      Hopeless 
By  VICTOR  LAUBISTON 


THE  most  striking  feature  of  the  1921  drilling  in  the 
potential  oil-fields  of  the  Canadian  West  is  the  con- 
sistently inconclusive  nature  of  the  results  secured.  The 
existence  of  large  oil  reservoirs  in  the  West  has  neither 
been  proven  nor  disproven. 

Widely  circulated  reports  regarding  actual  oil  discoveries 
and  potential  oil  resources  have  led  a  large  section  of  the 
Canadian  public  to  regard  the  West  as  one  vast  oil  reser- 
voir. This  idea  is  entirely  erroneous.  Indications  of  oil 
and  gas  have  been  found  at  widely  scattered  points  over  a 
vast  area  extending  from  the  international  boundary  to 
beyond  Fort  Norman.  Several  productive  gas  fields  have 
been  developed,  and  a  small  oil  production  has  been  secured 
in  two  localities,  hundreds  of  miles  apart. 

But  the  existence  of  oil  seepages,  and  the  finding  of 
small  oil  and  gas  showings  in  wells  drilled  over  a  large 
area,  does  not  mean  that  the  entire  area  is  a  huge  oil  res- 
ervoir. The  superficial  area  of  even  the  greatest  oil  pools 
is,  as  a  rule,  relatively  small.  So  huge  is  the  area  of  the 
Canadian  West,  that  we  may  look  with  confidence  for  the 
ultimate  discovery  of  many  oil  producting  fields  of  limited 
area;  but  the  hunting  for  these,  even  with  the  aid  of  the 
geologist,  is  a  good  deal  like  hunting  for  a  needle  in  a 
haystack. 

Only  Fifty  Bigs  in  Operation 

In  a  territory  greater  in  extent  than  all  the  oil-produc- 
ing states  of  the  American  republic,  there  have  been  this 
year  in  the  Canadian  West  fewer  than  50  drilling  rigs  in 
operation.  With  similar  oH  prospects,  a  relatively  small 
area  in  Texas  would  be  studded  with  thousands  of  derricks. 
Naturally,  with  such  restricted  operations  over  so  large  an 
area,  development  will  be  slow,  and  the  ultimate  proving 
or  disproving  of  the  petroleum  resources  of  the  Canadian 
West  will  be  a  matter  of  years. 

The  Season's  Work 

A  review  of  this  season's  work  in  the  west  must  of 
necessity  make  frequent  reference  to  Imperial  Oil,  Ltd. 
This  company  has  borne  the  brunt  of  the  campaign.  It 
has  been  interested  this  year  in  close  to  a  score  of  tests  in 
a  dozen  or  more  widely  separated  areas  between  the  inter- 
national boundary  and  the  Arctic  Circle.  The  Imperial 
Oil,  Ltd.  development  campaign  is  a  comprehensive,  careful 
and  intelligent  one,  based  upon  the  most  thorough  geo- 
logical investigation  of  the  oil  possibilities  of  the  Canadian 
West  ever  undertaken.  It  has  been  in  progress  since  1919, 
and  will  ultimately  involve  the  expenditure  of  millions  of 
dollars.  Its  objects  are  exploratory  rather  than  commer- 
cial. With  this  end  in  view,  the  drilling  has  been  widely 
scattered,  the  most  promising  areas  in  the  West  being 
given  first  attention. 

In  1921,  the  operations  in  the  far  north  gripped  the 
public  attention  to  the  exclusion  of  the  far  more  numerous 
drilling  tests  carried  on  in  old  Alberta  and  Saskatchewan. 
The  distance  from  civilization  of  the  Fort  Norman  field, 
the  widely  circulated  repots  of  a  huge  gusher  there,  the 
Jifflculties  of  transportation  and  development,  and  such 
spectacular  elements  as  the  establishment  of  aeroplane 
communication  to  bridge  the  huge  distances — all  these 
factors  have  combined  to  arouse  widespread  interest  in  the 
Mackenzie  field. 

Results  Disappointing 

Yet  the  results  in  1921  have  been  disappointing.  In 
a  recent  estimate  of  these  results,  sponsored  by  the  produc- 
tion department  of  Imperial  Oil,  Ltd.,  throws  clear  light 
'^n   the  actual   status   of  this  celebrated   well,   which,   last 


year,  was  credited  by  rumor  with  an  Initial  production  of 
2,000  bbbls.  a'  day. 

"It  is  our  desire  to  thoroughly  test  the  territory  and 
we  are  leaving  nothing  to  chance.  For  this  reason  the 
season  of  1921  has  been  a  time  of  preparation,  and  we  are 
not  in  a  position  to  say  that  any  advance  has  been  made 
in  our  knowledge  of  the  field  since  last  year.  Four  new 
wells  are  at  present  contemplated,  two  of  these  are  actively 
drilling  now,  but  the  progress  made  depends  greatly  on 
climatic  conditions,  and  the  ability  to  carry  on  during  the 
winter  is  an  uncertain  factor. 

"In  addition  to  preparing  for  new  endeavors,  the  most 
has  been  made  of  the  success  we  have  already  achieved. 
Limited  storage  facilities  have  been  built,  and  a  small  re- 
fining plant  has  been  put  in  commission  to  supply  motiVe 
power  to  our  aeroplanes. 

The  Fort  Norman  Well 

"The  Discovery  Well  (at  Fort  Norman)  at  a  depth  of 
783  ft.  got  production  from  the  Fort  Creek  shales.  Con- 
trary to  what  has  been  freely  stated  in  the  press,  the  pro 
duction  was  not  from  an  'oil  sand',  or  even  'the  main  oil 
sand'  as  some  writers  with  an  eye  to  detail  have  described  it. 
Drilling  was  carried  below  the  oil  horizon,  and  when  it  was 
seen  that  the  'pay'  had  been  passed,  20  ft.  of  casing  was 
removed  and  the  oil  spouted  over  the  rig. 

"Estimates  of  initial  production  are  merely  guesswork, 
as  no  storage  facilities  were  available  at  the  time  and  no 
capacity  test  was  made.  The  early  promise  of  Canada's 
latest  gusher  has  not  been  wholly  fulfilled.  Having,  in  an 
Initial  burst  of  enthusiasm,  blows  its  head  off,  there  is  now 
a  fairly  steady  production  of  around  10  bbls.  a  day,  un- 
less the  well  is  capped  for  24  hours  when  a  sufficiency  of 
gas  is  accumulated  to  stage  a  come-back  for  a  few  minutes 
at  a  time. 

"It  is  desirable,  in  view  of  the  widely  divergent  reasons 
which  have  been  given  for  this  loss  of  production,  to  make 
it  perfectly  clear  that  natural  causes  alone  are  responsible. 
A  driller  returned  from  the  north  is  quoted  as  ascribing  the 
comparative  failure  of  the  well  to  500  ft.  of  open  hole 
which  is  caving  badly.  As  the  total  depth  of  the  well  is 
783  ft.  and  there  is  760  ft.  of  6  inch  casing  in  the  hole, 
the  information  is  wide  of  the  mark. 

"Since  the  start  of  the  season  the  well  has  been  cleaned 
out  to  the  bottom  but  no  attempt  has  been  made  to  deepen 
It,  as  we  are  dependant  on  its  present  production  for  oiTr 
many  activities.  Its  location  precluded,  to  a  great  extent, 
the  hopes  of  large  or  continued  production.  It  has  served 
its  day  and  generation  by  proving  the  existence  of  pro- 
ductive horizons,  and  has  still  to  exhaust  the  possibilities 
after  deeper  drilling." 

This  lengthy  excerpt  is  desirable  as  giving  the  first  and 
only  official  pronouncement  as  to  the  production  and  actual 
status  of  the  Fort  Norman  well  which,  in  the  fall  of  1920. 
directed  the  attention   of  oil  seekers  to  the  sub-Arctics. 
Other  Imperial   Oil   Wells 

Outside  the  Discovery  well,  Imperial  Oil,  Ltd.  has  three 
additional  tests  definitely  located  in  the  Mackenzie  field, 
below  Fort  Norman.  No.  2,  on  Bear  Island,  had  just  start- 
ed drilling  when  navigation  closed  in  September.  No.  3, 
almost  directly  across  the  Mackenzie  from  the  Disccvery 
well,  was  then  down  92  feet.  Derrick  timbers  and  mach- 
inery were  being  assembled  for  No.  4  well,  approximately 
six  miles  below  (that  is,  north  of)  Fort  Norman.  Imperial 
Oil,  Ltd.  is  leaving  drilling  crews  in  the  north  for  the 
winter.  These  will  drill  as  late  as  possible,  and  resume 
work  as  early  as  possible  in  the  spring.  Thus,  by  the  time 
the  first  north  bound  boat  reaches  Port  Norman,  toward 


January  6,  1922 


THE       MONETARY       TIMES 


183 


The  Greenshields  Review 

For  over  ten  years  the  Greenshields  Review  has  in- 
terpreted w^ith  considerable  accuracy  industrial  and 
financial  conditions  and  the  trend  they  indicate, 

A  copy  of  The  Review  and  INVESTMENT  SUGGEST- 
IONS will  be  mailed  on  request. 

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UNLIKK  lut.st  in<lustrial  companii-H 
fcir  whew  product  a  lessened 
(lenutnd  now  exists,  (he  denianti  for 
the  services  of  Hydro-Electric  Com- 
panies is  IncreaslnK  because  the  use 
c  f  their  p.wer  is  most  tM-ononiic«l 
and  depen<lal)le.  Water  Power  Com- 
panies have  alsii  benefitwl  largely  by 
their  relatively  small  lalK>r  reijulre- 
ii.ents  and  the  fact  that  they  have 
n  1  heavy  Inventory's  to  mark  down. 

A  study  of  the  Hydro-Electric  aita*- 
tion  convint'es  us  that  the  bonds  of 
AVater  Power  Companies  offer  the 
iM'st  me<ii>im  of  inv<'stment  obtain- 
able in  corporation  s<'<-urlties.  Their 
rec(.nl  is  an  enviable  one;  In  fact 
the  bonds  of  two  of  our  leading 
AVater  Power  Coni|)anl<;s  are  seUlng 
I  on  about  a  5.8&7c  yield  basis. 

Write  to-day  Jot  folder  of  fact* 
regarding  tpater  potoer«. 

NESBITT.  THOMSON  &  COMPANY 

I.IMITF.II 

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MOXTUEAli  HAMILTON  lX)NI>ON,  OnU 


134 


THE       MONETARY      TIMES 


Volume     68 


the  end  of  June  or  beginning  of  July  In  1922,  some  of  this 
drilling  may  have  produced  definite  results.  The  year  1921, 
however,  merely  saw  the  work  nicely  started. 

What  other  drilling  will  later  be  undertaken  by  Im- 
perial Oil,  Ltd.  in  this  field  depends  on  the  results  of  the 
tests  now  in  progress.  The  Bear  Island  well  (No.  2) 
should  give  important  data  on  which  to  base  operations 
for  the  future,  as  the  Bosworth  series,  which  were  found 
to  contain  oil  in  the  Discovery  well,  will  here  be  tapped 
at  a  distance  from  their  outcrop.  The  Discovery  well  was 
located,  not  at  the  point  where  prospects  were  most  prom- 
ising for  a  large  and  permanent  commercial  production, 
but  at  the  point  where  a  production  of  any  kind  could  be 
got  the  quickest. 

In  addition  to  the  Imperial  drilling,  the  Port  Norman 
Oil  &  Development  Company  drilled  one  test  in  the  Mack- 
enzie field,  six  miles  south  Of  the  Discovery  well.  This 
test  had  to  be  temporarily  discontinued  at  1512  ft.,  owing 
to  lack  of  casing;  the  drillers  came  out  for  the  winter  and 
will  return  next  season  to  complete  the  well.  A  good  flow 
of  gas  was  struck,  sufficient  for  camp  and  drilling  fuel. 
At  1512  ft.  the  drill  had  not  reached  the  geological  horizon 
which,  at  783  ft.,  was  productive  of  oil  In  the  Discovery 
well;  indicating  that  at  this  point,  six  miles  from  the  Dis- 
covery well,  the  oil-bearing  formations  are  more  deeply 
burled. 

Mackenzie  River  Oil,  Ltd.  planned  to  start  actual  drill- 
ing this  season;  but  the  drilling  equipment  did  not  reach 
the  field  In  time.  However,  a  geological  party  headed  by 
A.  H.  Low  examined  the  territory,  and  selected  tentative 
locations  on  which  work  will  be  done  next  year. 
Other  Oil  Areas 

The  foregoing  summary  represents  all  the  actual  drill- 
ing done  in  the  Mackenzie  (Fort  Norman)  field  during  the 
past  season.  Outside  this  area,  one  test  was  drilled  by 
Imperial  Oil,  Ltd.  at  Windy  Point,  on  the  north  shore  of 
Great  Slave  Lake.  This  well  was  carried  between  1600  and 
1800  ft.,  at  which  depth  the  granite  was  struck.  The  drill 
penetrated  salt,  and  disclosed  a  little  gas,  but  no  oil  what- 
ever; though  on  the  surface  at  Windy  Point  oil  lies  In  pools. 
The  result  is  regarded  as  definitely  condemning  this  section 
of  the  Great  Slave  Lake  district.  The  drilling  outfit  has 
been  dismantled,  and  will  be  taken  away  next  spring — pos- 
sibly to  a  new  location  at  Pine  Point,  on  the  south  shore. 
No  decision  has  yet  been  reached,  however,  as  to  this  new 
location. 

The  result  at  Windy  Point  Indicates  that.  If  oil  exists 
in  commercial  quantities  anywhere  in  the  Great  Slave 
Lake  district,  the  best  prospects  are  south  and  west  of  the 
Lake.  At  the  mouth  of  Hay  river  considerable  territory 
was  staked  this  summer  by  a  geological  party  headed  by 
Dr.  J.  J.  O'Neill  and  A.  H.  Schurer.  Montreal  Interests 
will  next  season  undertake  actual  drilling  in  this  area. 
Handicaps  in  the  North 

In  general,  development  work  in  the  far  north  has  been, 
and  will  continue  to  be,  handicapped  by  the  exceedingly 
short  season,  and  the  difficulties  of  transportation.  Thus, 
the  Fort  Norman  Oil  &  Development  Company  crew  were 
not  able  to  start  work  before  July,  and  had  to  leave  toward 
the  end  of  August.  The  16-miIe  portage  on  Slave  River 
between  Fort  Fitzgerald  and  Port  Smith  represented  this 
year  a  monumental  obstacle,  which  must  be  bridged  by  a 
railroad  of  some  sort  if  the  oil  development  of  the  far 
north  is  to  proceed  any  faster  than  a  snail's  pace. 

In  Alberta  and  Saskatchewan,  drilling  by  Imperial  Oil, 
Ltd.  has  been  supplemented  by  operations  undertaken  by 
other  interests.  The  Imperial  drilling,  however,  represents 
the  backbone  of  the  development  work.  It  may  for  con- 
venience be  grouped  into  two  general  areas —  the  western 
area,  represented  by  the  foothill  belt  which  runs  parallel 
and  just  east  of  the  Rocky  Mountains  for  r  distance  of 
800  miles  or  more  north  of  the  international  boundary; 
and  the  eastern  area,  comprising  central  and  eastern  Al- 
berta and  western  Saskatcheijvan. 

Imperial's  Eastern  Area 
In  the  eastern  Area,  Imperial  Oil,  Ltd.  this  year  drilled 


three  tests  in  western  Saskatchewan,  and  three  moi  .n 
eastern  and  central  Alberta.  Of  the  tests  on  the  Saski.ch- 
ewan  side  of  the  boundary,  one,  on  the  Great  West  Natural 
Gas  Corporation  leases  near  Rush  Lake,  finished  a  dry  hole 
at  2,500  ft.  depth  and  was  abandoned,  the  formations  be- 
ing unfavorable  to  further  drilling.  At  Muddy  Lake. 
Sask.  the  Imperial  has  a  test  down  1780  ft.,  and  at  Consul, 
near  the  international  and  Alberta  boundaries,  another 
Imperial  test  is  drilling  at  1,800  ft.  Neither  of  these  has 
encountered  oil  or  gas,  nor  is  the  outlook  promising,  though 
drilling   is  being   continued. 

In  eastern  Alberta,  Imperial  Oil,  Ltd.  some  months  ago 
finished  a  deep  test  south  of  Czar.  No  production  was 
secured,  though  the  drill,  at  3,500  ft.,  had  passed  through 
all  the  possible  petroliferous  formations.  The  venture  was, 
accordingly,  abandoned.  Further  south.  Imperial  Oil,  Ltd. 
has  a  test  down  1750  ft.  in  the  Misty  Hills,  south  of  Mon- 
ito,  which,  at  last  reports,  had  neither  oil  or  gas. 

In  the  Irma  district,  east  of  Edmonton,  Imperial  Oil, 
Ltd.  this  fall  located  a  new  test  on  sec.  18-45-7-4,  within  a 
mile  of  Fabyan  station.  A  3-Inch  pipe  line  has  been  laid 
to  the  Viking-Battle  Creek  syndicate's  well  at  Grattan 
coulee,  the  gas  from  which  will  be  used  in  the  drilling  at 
Fabyan.  At  Birch  Lake,  the  Talpey-Arnold  syndicate  has 
been  drilling;  but  progress  has  been  hamperd  by  drilling 
difficulties,  so  that  no  definite  results  have  yet  been  secured. 
The   Irma   District 

The  Irma  district  is.  In  a  sense,  an  extension  of  the 
Viking  gas  field,  75  miles  east  of  Edmonton.  This  field 
was  developed  some  years  ago  by  the  North  Alberta  Natural 
Gas  Development  Company,  which  has  nine  or  10  gas  wells 
with  an  estimated  aggregate  production  of  40,000,000  cu. 
ft.  a  day  or  upwards.  This  production  was  to  have  been 
piped  to  Edmonton;  but  the  company  and  the  city  could 
not  agree  on  a  proposed  increase  In  the  rate  fixed  by  the 
original  franchise.  Showings  of  oil  were  encountered  in 
one  or  two  of  the  Viking  gas  wells,  lending  encouragement 
to  the  idea  that  commercial  oil  production  might  be  secured 
by  extending  the  drilling. 

The  Imperial  test  In  the  Misty  Hills  is  one  of  a  group 
of  wells  drilling  south  of  Monitor.  These  Include  a  test 
by  the  Talpey-Arnold  syndicate,  which  has  shut  down  for 
the  winter  without  securing  definite  results;  another  by 
the  West  Regent  Oil  &  Gas  Company,  of  Calgary,  last  re- 
ported drilling  around  2,500  ft.;  and  one  by  the  Mud  Buttes 
Oilfields,  Ltd.  of  Calgary,  which  only  recently  started  actual 
drilling.  The  Talpey-Arnold  syndicate  is  reputed  to  repre- 
sent the  Union  Oil  Company  of  California. 

In  Central  Alberta  the  Mutual  Oil  &  Gas  Company  of 
Edmonton  started  drilling  at  Pigeon  Lake,  25  miles  from 
Wetaskiwin,  early  in  November.  A  test  near  Lac  Ste.  Anne, 
started  last  year  by  local  interests  and  at  one  time  reported 
a  commercial  producer,  has  failed  to  produce  definite  re- 
sults. Efforts  are  being  made  to  reorganize  the  Nakamun 
Oil  &  Asphalt  Company  of  Edmonton.  This  company, 
which  sold  quite  a  bit  of  stock  in  England,  drilled  a  1,400- 
ft.  hole  near  Lake  Nakamun  in  1914,  but  had  to  dis- 
continue owing  to  the  financial  stringency  following  the 
outbreak  of  the  war. 

Unproductive  Areas 

So  far  as  central  and  eastern  Alberta  and  western  Sask- 
atchewan are  concerned,  the  results  of  this  year's  work 
have  been  indecisive  where  they  have  not  been  negative. 
No  commercial  production,  either  of  oil  or  gas,  has  been 
secured.  The  Czar  and  Rush  Lake  prospects  have  been 
definitely  condemned  by  dry  holes.  Operations  in  this  gen- 
eral area  are  hampered  by  the  lack  of  outcrops,  rendering 
the  preliminary  work  of  the  geologist  very  difficult,  and 
compelling  the  operators  largely  to  "go  it  blind"  in  locating 
their  tests.  The  areas  tested  represent,  however,  the  most 
promising  locations  so  far  as  geological  science  has  been 
able  to   determine   them. 

In  the  foothill  belt  of  western  Alberta,  five  distinct 
areas  are  being  tested  by  Imperial  Oil,  Ltd.  and  associated 
interests.  The  northernmost  of  these  Is  the  Pouce  Coupe 
district,  where  a  well  was  started  last  July  on  Pouce  Coupe 
Creek,  a  few  miles  east  of  Rolla,    B.C.     At  1640    ft.    this 


January  G,  1922 


THE       MONETARY       TIMES 


135 


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136 


THE      MONETARY      TIMES 


Volume  68 


well,  after  encountering  showings  of  oil  and  gas  at  many 
horizons,  struck  a  large  gas  flow,  estimated  at  2,500,000 
cu.  ft.  a  day.  This  flow  has  been  increased  by  deeper  drill- 
ing, and  at  last  reports  was  estimated  anywhere  between 
11,000,000  to  30,000,000  cu.  ft.  a  day.  These  estimates 
are  unofficial  and  are  probably  much  exaggerated.  The 
well  seems,  however,  to  have  got  a  considerable  gas  pro- 
duction, which,  owing  to  the  absence  of  population,  is 
practically  worthless.  The  well  is  to  be  drilled  deeper  for 
oil.  Imperial  Oil,  Ltd.  and  other  interests  hold  extensive 
leases  in  this  district,  and  if  commercial  oil  production 
results  from  the  first  test,  a  lot  of  development  work  will 
follow. 

In  the  Brazeau  district,  west  of  Edmonton,  Imperial 
Oil,  Ltd.  has  located  a  new  well  at  Coalspur  Station,  and 
will,  if  possibe,  carry  on  drilling  operations  through  the 
winter.  This,  also,  represents  a  portion  of  the  foothill 
belt. 

The  Okotoks  Field 

Southwest  of  Calgary  is  the  Okotoks  field  (also  known 
as  the  Dingman,  Turner  Valley,  Black  Diamond  and  Sheep 
Creek  field)  which  was  responsible  for  the  Calgary  boom 
of  1914.  This  field  has  several  producing  wells,  the  best 
being  the  Southern  Alberta  Oil  Company  flowing  well, 
which  had  a  probable  maximum  production  of  50  bbls  a 
day.  A  subsidary  of  this  company  operated  a  small  refin- 
ing plant,  selling  the  gasoline  and  kerosene  throughout 
the  adjacent  territory.  The  pioneer  company  in  this  field, 
the  Calgary  Petroleum  Products,  Ltd.  which  drilled  the 
two  Dingman  wells,  met  with  many  difficulties,  including 
the  destruction  by  fire  over  a  year  ago  of  a  gasoline  absorp- 
tion plant  constructed  to  extract  gasoline  from  the  "wet 
gas"  production  of  the  Dingman  wells.  Imperial  Oil,  Ltd. 
came  to  the  assistance  of  this  company;  and  the  outcome 
was  the  organization  last  January  of  the  Royalite  Oil  Co., 
in  which  the  stockholders  of  the  original  Calgary 
Petroleum   Products,    Ltd.    retained   a   substantial   interest. 

Since  then  the  Royalite  Oil  Company  has  drilled  Ding- 
man No.  3  well  to  2,000  ft.,  securing  a  wet  gas  flow  esti- 
mated at  1,000,000  cu.  ft.  a  day.  This  well  is  to  be  drilled 
deeper  for  oil;  and  No.  4  has  been  located  not  far  from 
the  Southern  Alberta  No.  1.  The  Royalite  Oil  Company 
also  has  a  new  gasoline  absorption  plant  completed  and 
ready  to  operate.  This  will  extract  the  gasoline  from  the 
wet  gas;  and  the  dry  residual  gas  will  be  piped  to  Okotoka, 
where  it  will  be  turned  into  the  line  of  the  Canadian  West- 
ern Natural  Gas  Company,  for  distribution  to  Calgary. 
The  Royalite  Oil  Company  will  pursue  a  policy  of  steady 
and  systematic  development  of  the  Okotoks  field;  which — 
outside  the  Imperial  Discovery  well  at  Fort  Norman —  is 
today  the  only  commercial  oil  field  in  the  Canadian  West. 
Sonthern  Alberta  Oils,  Iitd. 
The  Southern  Alberta  Oil  Company,  Southern  Alberta 
Refineries,  Ltd.  and  Alberta  Southern  Oil  Company,  con- 
trolled by  allied  interests,  this  year  merged  their  identity 
In  the  Southern  Alberta  Oils,  Ltd.  New  capital  has  been 
secured  and  further  development  work  will  be  carried  on. 
Several  smaller  companies,  formed  at  the  time  of  the 
Calgary  boom  or  shortly  after,  still  have  drilling  outfits  in 
the  Okotoks  field;  but  the  work  done  by  these  has  been 
Intermittent,  and  no  additional  production  has  been 
secured. 

Further  south,  another  foothill  area  near  Nanton- — 
the  Willow  Creek  field —  is  the  scene  of  two  tests  by  Imp- 
erial Oil,  Ltd.  Of  these,  one  initiated  by  the  Imperial,  on 
sec.  29-14-2-5,  is  down  2141  ft.  without  a  show.  The 
Imperial  is  also  completing,  under  arrangement  with  the 
Alberta  Associated  Oils,  Ltd.  the  "Christie"  well  on  sec. 
7-16-2-5.  This  is  being  held  up  at  2860  ft.  by  drilling 
difficulties. 

Close  to  the  International  boundary,  Imperial  Oil,  Ltd. 
has  two  tests  drilling  in  the  Twin  Butte  field  neai-  Pincher 
Creek.  No.  1  well,  sec.  14-4-30-5,  is  drilling  at  2,730  It. 
and  No.  2  sec.  20-3-29-4,  is  drilling  at  3,450  ft.  Neither 
has  secured  any  commercial  production. 

Thus,   the  foothill  belt  has  secured,  at  Pouce  Coupe, 


some  encouragement  of  oil  production  in  the  form  of  a  con- 
siderable flow  of  gas;  and  in  the  Okotoks  field  has  had  for 
several  years  a  commercial  oil  production.  These  foot- 
hill areas  today  represent  probably  the  most  encouraging 
prospects  for  oil  in  the  Canadian  West. 
Sonthern  Alberta 
Outside  the  foothills  proper,  there  has  been  a  little 
drilling,  chiefly  by  local  interests,  in  various  parts  of  south- 
ern Alberta.  Many  years  ago  a  small  production  was  se- 
cured at  Oil  City,  in  the  Pincher  Creek  district;  and  Wm. 
Livingston  of  Calgary,  who  is  also  interested  in  the  South- 
ern Alberta  Oils.  Ltd.,  has  been  doing  some  work  in  this 
southwestern  corner  of  Alberta.  Further  east,  the  de- 
velopment of  commercial  oil  production  in  Montana  has 
stimulated  interest  in  the  Sweetgrass  district,  close  to  the 
international  boundary;  and  there  has  been  some  drilling 
near  Gardston  and  Foremost,  so  far  without  commercial 
results.  At  Aldersyde,  south  of  Calgary  and  east  of  the 
Okotoks  field,  the  Sam  Drumheller  Oil  &  Gas  Company  is 
drilling  a  well  on  the  Bird  ranch.  The  Canadian  Western' 
Natural  Gas  Company  is  reported  to  be  undertaking  some 
new  drilling  for  gas  'in  Southern  Alberta,  to  replenish  the 
declining  supply  from  the  Bow  Island  field. 

Bow  Island  and  Medicine  Hat,  both  in  southern  Alberta, 
have  been  famous  gas  fields  for  many  years.  This  year 
the  Medicine  Hat  Development  Company  is  drilling  for  oil 
in  the  Medicine  Hat  district,  near  Many  Island  Lake;  and 
is  reported  to  have  encountered  slight  oil  indications  at 
910  ft.  depth. 

Peace   River   District 

Two  areas  in  northern  Alberta  which  have  received  a 
great  deal  of  attention  in  the  past  are  not  included  in  the 
Imperial  Oil,  Ltd.  campaign.  One  of  these  is  the  Peace 
River  district,  where  the  Peace  River  Oil  Company  drilled 
the  McArthur  No.  1  well  about  four  years  ago.  A  dozen 
or  more  tests  for  oil  have  since  been  drilled  in  the  20 
miles  north  of  Peace  River.  Most  of  these  encountered 
shows  of  heavy  asphaltic  oil  within  1,0  00  ft.,  and  the  Mc- 
Arthur No.  2  was  reputed  to  indicate  a  production  of  50 
bbls  a  day.  However  the  operators  in  attempting  to  drill 
deeper  encountered  a  big  flow  of  salt  water  under  heavy 
gas  pressure,  which  forced  the  abandonment  of  the  wells. 
This  big  water  vein,  suposed  to  lie  between  the  Cretaceous 
and  Devonian  formations,  has  been  in  the  past  the  fatal 
obstacle  to  successful  development. 

This  year  three  companies  were  still  active  In  the  Peace 
River  district.  Peace  River  Petroleums  No.  2,  drilling  near 
Tar  Island,  finished  as  a  water  gusher,  after  encountering 
encouraging  oil  showings.  San  Joaquin  Oil  Company  No. 
2,  sec.  12-85-21-5,  after  battling  with  almost  insurmount- 
able obstacles,  appears  to  have  overcome  the  water  problem 
and  is  ready  to  drill  deeper.  The  Victory-Albersas  well  at 
Peace  River  town,  which  now  has  the  deepest  hole  in  the 
field,  seems  also  to  have  shut  off  the  water.  Drilling  in 
these  two  wells  has  not  been  carried  far  enough  into  the 
underlying  formation  to  furnish  conclusive  results. 

The   Tar   Island   Development   Company   has   secured   a 

Vancouver  contractor  to  put  down  two  diamond  drill  holes, 

in  an  effort  to  overcome  the  water  problem;  and  Vancouver 

interests  are  projecting  another  test  by  the  same  method. 

Athabaska  District 

The  other  northern  Alberta  area  referred  to  is  the  tar 
sand  district  of  the  Athabaska,  famous  for  its  exposures  ot 
petroleum-impregnated  sandstone.  Many  shallow  tests 
drilled  in  the  vicinity  of  Fort  McKay  and  Fort  McMurray 
have  uniformly  encountered  showings  of  black  oil  too  heavy 
to  flow  or  pump.  Undoubtedly  the  tar  sand  deposits  con- 
tain an  immense  quantity  of  oil;  but  the  general  view  now 
held  by  geologists  is  that  there  is  no  structure  to  collect 
the  oil  in  quantities  sufficient  for  drilling.  There  may  be 
oil  pools  in  isolated  areas  at  some  distance  from  the  out- 
crops; but  the  consensus  of  opinion  seems  to  be  that  the 
development  of  the  tar  sand  deposits  is  a  distillation  pro- 
position rather  than  a  drilling  proposition. 

This    year    several    companies    have    made    preliminary 


January  6,  1922 


THE       MONETARY      TIMES 


U7 


Cable  Address,  "Nanton,  Winnipeg" 


OSLER,  HAMMOND  &  NANTON 

Investment  Brokers,  Financial 
and  General  Insurance  Agents 


WINNIPEG,  CANADA 


Represent ; 


Represent : 


LOANING 


INSURANCE 


Law,  Union  and  Rock  Insurance  Co.  (Invest- 
ment Dept.) 

North  of  Scotland  Canadian  Mortgage  Co.,  Ltd.- 
Dominion  of  Canada  Investment  and  Deben- 
ture Co.,  Ltd. 

Osier   &   Nanton   Trust   Company 

LANDS 
Calgary  &  Edmonton  Land  Co.,  Ltd. 
Canada  Saskatchewan  Land  Co.,  Ltd. 
Winnipeg  Western  Land  Corporation,   Ltd. 


Law,  Union  and  Book  Insurance  Company 
New  York  Underwriters'  Agency 
Western  Assurance  Company 
Queen  Insurance  Company 
Northern  Assurance  Co.,  Ltd. 
Guarantee  Compaay  of  North  America 

STOCKS  AND  BONDS 

Stocks  and  Bonds  bought  and  sold 
on  Toronto,  Montreal,  New  York 
and  London  (Eng. )  Exchanges. 


REAL  ESTATE  DEPARTMENT 
Ituilding  Management,  Rentals  and  City  Real  EiState 


Cable  Address,   "Osier,  Toronto" 


OSLER  &  HAMMOND 

Stock  Brokers  and  Financial  Agents 

Members 
Toronto    Stock    Exchange 
Montreal  Stock  Exchange 

21  JORDAN  STREET,  TORONTO 


STOCKS  BOUGHT  and  SOLD  ON  COMMISSION  ON  LONDON, 
ENG.,  NEW  YORK,  MONTREAL  AND 
TORONTO  EXCHANGES 


DEALERS  IN  DEBENTURES 


SIR  EDMUND  B.  OSLER  F.  G.   OSLER  G.  T.  CHISHOLM 

H.  F.  MARRIOTT  H.  FRANKS 


138 


THE       MONETARY       TIMES 


Volume  68 


tests  of  various  distillation  processes.  The  Alcan  Oil  Cor- 
poration of  New  York  has  begun  one  well  near  Fort  Mc- 
Kay, to  be  finally  completed  next  season;  and  also  plans 
to  set  up  a  50-bbl  distillation  plant.  The  Butcher  Oil  com- 
pany this  fall  tried  out  a  process  of  extracting  oil  from  the 
tar  sands  by  application  of  heat;  a  fair  quantity  of  oil  was 
secured  in  the  experimental  work,  and  plans  are  being 
made  for  setting  up  10  or  12  reports  next  year.  H.  Draper 
of  Petrolia  has  also  done  experimental  work;  and  the  G.  J. 
Hammond  syndicate  of  Port  Worth,  Texas,  which  recently 
took  over  6,000  acres  of  the  tar  sand  holdings  of  the  old 
Athabasca  Oil  &  Asphalt  Company,  is  planning  to  set  up 
a  distillation  and  refining  plant.     Little  definite  Informa- 


tion is  available  as  to  the  proportion  of  oil  recovered  from 
the  tar  sands;  but  several  different  processes  are  being 
utilized,  and  other  companies  besides  those  specified  are 
reported  more  or  less  active  in  this  line  of  work. 

In  north-eastern  Saskatchewan,  the  North  Battleford 
Oil  &  Gas  syndicate  in  October  commenced  drilling  a  well 
on  the  Nabl  river,  in  the  Pasquia  Hills  district —  an  area 
far  removed  from  the  other  oil  operations  in  western  Can- 
ada. The  Manitoba  public  works  department  has  also  been 
doing  some  drilling  in  the  Dauphin  district  of  Northern 
Manitoba,  but  no  commercial  results  have  been  reported. 
Alberta  is,  for  the  present  at  least,  the  great  field  of  drilling 
activity. 


Legal  Decisions  of  1921  Affecting  Investments 

Agreement  of  Sale  of  Lands  by  Executors  of  an  Estate — Subscription 
For  Stock  in  a  New  Company — Instructions  to  Broker  For 
Grain   Transactions — ^Western   Canada   Mortgage   Co.   vs.    O'Farrell 


A  CASE  dating  back  to  the  boom  days  in  western  real 
estate,  involving  some  $250,000  was  decided  by  the 
Supreme  Court  of  Canada  during  the  past  year.  The 
judgment  of  the  Supreme  Court  of  Alberta  granting  specific 
performance  of  an  agreement  of  sale  of  lands  by  executors 
of  the  Inman  estate  and  by  J.  H.  Mellish  to  H.  P.  Kennedy, 
was  upheld.  The  case  dates  back  to  1913  when  Kennedy 
purchased  some  500;  acres  of  land  to  the  east  of  the 
Edmonton  stockyards,  just  outside  the  city  limits.  The 
Inman  estate  comprised  320  acres,  while  180  acres  were 
purchased  from  Mellick.  With  real  estate  booming  and 
land  going  at  unheard-of  figures,  Kennedy  paid  J298,000 
for  the  acreage..  Shortly  after  the  sale  was  effected  the 
bottom  dropped  out  of  the  boom  and  Kennedy  did  not 
complete  his  payments.  Suit  was  brought  by  the  respond- 
ents in  the  present  case  In  the  Supreme  Court  to  compel 
Kennedy  to  carry  out  the  agreement. 

In  the  Inman  case  ?14,000  has  already  been  paid, 
while  1192,000  is  the  amount  claimed.  A  total  of  ?68,000 
was  paid  on  the  Mellick  property  and  suit  brought  for 
the  balance  of  $24,000.  In  his  defence  the  appellant 
asserted  that  the  Inman  property  was  never  at  any  time 
worth  any  more  than  $31,000.  while  the  valuation  of  the 
Mellick  property  was  placed  at  $21,900.  The  court  was 
asked  to  relieve  him  from  his  contract  by  allowing  him  to 
forfeit  a  considerable  part  of  the  amounts  already  paid 
without  further  liability  on  the  ground  that  In  1913  all 
parties  were  laboring  under  the  general  infatuation  in- 
cidental to  the  times,  resulting  in  fictitious  values  being 
placed  on  Edmonton  property.  The  famous  South  Sea 
bubble  of  1720,  when  a  great  portion  of  the  population 
of  England  lost  their  heads  and  plunged  deeply  into  spec- 
ulation, was  referred  to,  and  It  was  pointed  out  that  at 
that  remote  date  in  many  instances  English  judges  had 
seen  fit  to  grant  relief. 

Subscription  for  Stock 

In  a  stated  case  to  the  Supreme  Court  of  Alberta  on  a 
question  of  investment  in  stock,  It  was  held: : 

The  facts  of  the  special  case  stated  to  the  court  were: 
The  applicant,  with  others  of  his  class,  subscribed  for 
shares  in  the  company.  A  couple  of  years  later  they 
claimed  to  have  learned  of  some  facts  in  connection  with 
the  purchase  of  the  land,  for  the  acquisition  of  which 
the  company  had  been  formed,  and  with  respect  to  the 
consitution  and  distribution  of  the  company's  shares  with 
which  they  were  not  theretofore  familiar,  and  they  brought 
action  against  the  company  and  some  of  its  directors.  Two 
days  later  a  settlement  of  the  action  was  arrived  at,  the 
terms  of  which  were  embodied  in  a  written  agreement. 

The  company  was  not  a  party  to   this  agreement. 

The  shareholders  who  were  parties  to  this  agreement 
seven  months  after  date  brought  action  against  the  other 


parties  to  it  for  specific  performance  of  it.  In  which  they 
afterwards  obtained  a  judgment  for  specific  performance, 
with  a  personal  judgment  against  the  defendants  therein 
for  the  amounts  respectively  owing  to  them  under  this 
agreement.  The  company  was  not  a  party  to  this  action. 
This  judgment  directed  a  rectification  of  the  company's 
share  register  by  removing  therefrom  the  names  of  these 
dissatisfied  shareholders  and  substituting  therefor  the 
nominee  of  the  purchasers  of  their  shares.  The  company 
refused  to  obey  this  order,  and  a  motion  at  the  instance 
of  the  plaintiffs  in  that  action.  Including  the  applicant, 
to  compel  it  to  do  so  was  cut  short  by  the  winding-up 
order. 

The  pertinent  parts   of   the  judgment  are  as  follows: 

"The  applicant's  right  to  rescind  was  lost  by  the  com- 
mencement of  the  winding-up  proceedings  unless  before 
then  he  had  repudiated  his  shares  and  had  commenced 
proceedings  for  rescission.  The  bringing  of  the  first 
action,  in  which  he  was  a  plaintiff,  was  a  proceeding 
brought  for  the  rescission  of  his  contract  to  take  these 
shares,  and  it  was  an  effective  repudiation  of  them. 

"The  applicant's  right  to  have  his  name  removed  from 
the  register  and  from  the  list  of  contributorles  is  based 
entirely  upon  his  claim  that  he  is  entitled  to  rescission 
of  his  contract.  It  is  impossible  for  him  to  make  restitu- 
tion In  integrum  because  of  his  agreement  to  sell  his 
shares,  and  he,  therefore,  is  not  entitled  to  rescind.  His 
claim  for  rescission  is  absolutely  inconsistent  with  his 
recognition  of  his  contract  in  his  agreement  to  sell  his 
shares,  his  insistence  upon  that  agreement  by  his  action 
to  enforce  it,  and  his  subsequent  attempt  to  continue  his 
original  contract  by  having  the  purchaser  of  them  reg- 
istered in  the  books  of  the  company  as  the  owner  of  them. 

"In  my  opinion,  the  applicant  is,  for  the  reason  given, 
not  entitled  to  have  his  name  removed  from  the  list  of 
contributorles." 

Instructions    to    Brokers 

Another  case  in  Manitoba  decided  that  "One  who  in- 
structs his  broker  to  sell  for  him  wheat  which  he  agrees 
to  deliver,  and  which  it  is  the  intention  of  the  parties 
shall  be  delivered,  the  broker  causing  sales  to  be  made  to 
various  persons  in  consequence  of  these  instructions,  and 
who  is  unable  to  make  delivery  and  authorizes  such  broker 
to  purchase  sufficient  other  wheat  to  close  out  these  trans- 
actions is  liable  to  the  broker  for  any  loss  which  such 
broker  sustains  In   carrying  out  such   transactions." 

The  above  is  in  substance  the  judgment  in  the  case  of 
Canadian  Grain  Co.,  Ltd.,  vs.  Nichol.  The  facts  of  the 
case  were: 

In  July,  1916,  Nichol  instructed  the  company  to  sell 
on  his  account  wheat  for  delivery  in  October,  amounting 
to    9,000    bushels.      The    company    through    its    Winnipeg 


January  6,  1922 


THE      MONETARY       TIMES 


189 


British  Columbia  Provincial 

AND  MUNICIPAL  ISSUES 

We  are  in  the  market  at  all  times  to  consider  telegraphic  of- 
lerings  of  British  Columbia  securities,  and  our  distributing 
lacilities  enable  us  to  find  a  ready  market  for  these  securities 


British  American  Bond  Corporation 

H.    N.    Galer,    Pres.    &    Man.    Dlr.  «•  •  ^  victoria  OFFICE 

F.   L.  Beecher  Vlce-Pres.  I     imir^H  '"'"'*''   *'"SSi""  P°'}'^   Bulldlny. 

A.  C.   Flumerrelt   Director  1-.1II11  ICU  -  -  -  "J^  ^°"  ^D~E~n~T  1 

Hu.h  Daruison  Director  ^H^An'oKncr  Toronto  SoVtrel. 

Arthur  E.  Haynes  Director  "'■*"  Uhnch.  ^^^_  ^^^^  London 

E.  J.  Leveson  Director  Merchants  Bank  Bldg.  t'.S.A.        '  Eng! 

VANCOtrVER,    B.C. 

Member  B.  C.  Bond  Dealers  Assn. 


Brook  &  Allison 

Established    1907 

Real    Estate,    Loans    and    Insurance 
REGINA,   SASK. 


Estates  Managed 

Valuations 
Rents     Collected 


REFERENCES: 
Sterling    Banlt    of    Canada 
R.  G.  Dun  &  Co. 
BradstreetB.. 


Money    Invested   on   First    Mortgage 


H.M.E.  Evans  &  Company 

Limited 


FINANCIAL 
AGENTS 

Bonds,   Insurance, 

Real  Estate, 

Loans 


Union  Bank  BIdg. 

EDMONTON,  ALTA. 


140 


THE      MONETARY      TIMES 


Volume  68 


agents  did  so.  After  this  wheat  was  sold,  the  price  of  wheat 
rapidly  rose.  By  the  rules  of  the  Winnipeg  Grain  Ex- 
change it  was  necessary  to  put  up  margins  to  protect  the 
contracts  of  sale  against  the  rising  price.  Nichol  did  not 
have  the  money  and  he  asked  the  company  to  supply  it, 
which  they  agreed  to  do  provided  Nichol  would  undertake 
to  deliver  all  the  grain  sold  on  his  account,  and  indemnify 
them  against  any  loss  arising  from  his  failure  to  so  deliver. 
To  this  Nichol  agreed  in  writing,  and  the  company  put 
up  the  necessary  sums  to  protect  his  contracts.  On 
October  24  he  notified  the  company  that  he  could  not  make 
delivery  of  any  wheat,  and  on  the  same  day  Instructed 
them  to  buy  9,000  bushels  to  fulfill  the  contracts  of  sale 
which  they  had  made  on  his  behalf. 

The  action  was  for  the  difference  between  what  the 
company  was  obliged  to  pay  tor  the  wheat  in  October  and 
the  amount  coming  to  Nichol  from  the  purchasers  to  whom 
the  company  had  sold  9,000  bushels  on  his  behalf.  The 
defences  relied  on  were:  (1)  That  the  contracts  were 
illegal,  being  contrary  to  sec.  23  of  the  Criminal  Code, 
and  (2)  that  the  company  did  not  make  privity  of  con- 
tract between  the  principals. 

In  the  judgment,  the  following  explanations  of  the 
decision  above,  were  given: 

"So  far  as  the  first  objection  gees,  I  agree  with  the 
trial  judge  that  that  is  disposed  of  by  his  finding  of  fact  as 
to  the  intention  of  the  parties,  that  there  was  to  be  delivery 
of  wheat  by  Nichol.  The  trial  judge,  however,  held  that 
the  company  did  not  make  privity  of  contract  between  two 
principals. 

"So  far  as  this  is  concerned,  when  the  broker  repre- 
senting the  defendant  on  the  Grain  Exchange  sold  the 
wheat  of  the  defendant  to  other  brokers  representing  pur- 
chasers, then  it  seems  to  me,  that  there  was  a  binding 
contract  entered  into  for  the  sale  and  purchase  of  the  de- 
fendant's wheat." 

Mortgage  Investments 

Another  case  during  the  year,  that  of  Western  Canada 
Mortgage  Co.  v.  O'Farrell,  dealing  with  mortgage  invest- 
ment, is  also  interesting.  In  this  case,  stated  in  an  action 
on  a  mortgage,  the  Alberta  Supreme  Court  held  that  under 
sec.  63  of  the  Edmonton  charter,  where  a  mortgagee  al- 
lows the  mo?tgaged  property  to  be  sold  for  taxes  and  be- 
comes the  owner  at  the  tax  sale,  the  mortgage  so  far  as  it 
is  a  charge  against  the  land  Is  extinguished,  but  the  Court 
may  give  effect  to  10  Geo.  V.  1920,  ch.  3,  sec.  1  (16a)  and 
allow  the  plaintiff  to  proceed  upon  the  personal  covenant 
in  the  mortgage  and  issue  execution  thereon. 

The  facts  were:  "The  plaintiff  sues  upon  the  covenant 
of  the  defendant  In  a  certain  mortgage  given  by  the  de- 
fendant to  the  plaintiff,  September  15,  1911,  which  was 
varied  as  to  the  dates  of  payment  by  an  agreement  be- 
tween the  mortgagor  and  mortgagee  on  October  2,  1914, 
whereby  the  defendant  covenants  to  pay  the  sum  of  $8,000 
with  interest  from  October  1,  1914. 

"The  defendant  in  the  mortgage  covenants  that  he 
pay  all  taxes  levied  against  the  said  lands  and  in  defa,ult 
of  his  doing  so  the  mortgagee  might  pay  all  taxes  and 
same,  with  Interest,  should  become  a  part  of  the  money 
secured  under  the  mortgage.  The  mortgagor  did  not  pay 
the  taxes  and  the  lands  in  question  were  sold  by  the  city 
of  Edmonton  for  arrears  of  taxes,  amounting  to  $2,219. 
At  the  sale  by  the  city  of  these  lands,  for  arrears  of  taxes, 
the  mortgagee  purchased  the  lands  for  the  said  sum  of 
$2,219  and  became  the  registered  owner  thereof  and  has 
since  paid  the  taxes  assessed  against  the  said  lands." 

The  judgment  was  in  part  as  follows: 

"In  my  view  sec.  63  of  the  Edmonton  Charter  must 
be  considered,  as  such  section  provides  that  such  a  transfer 
under  tax  sale  as  occurred  in  this  instance  shall  not  only 
vest  in  the  purchaser  or  his  assigns  all  rights  of  property 
which  the  original  holder  had  therein,  but  shal'  also  purge 
and  disencumber  such  land  from  all  payments,  charges, 
liens,  mortgagee  and  encumbrances  of  whatever  nature 
and  kind  other  than  existing  liens  of  the  city  or  Crown. 
I  am  unable  to  give  any  other  effect  to  that  section  than 
the  declared  intention  therof  which  seems  to  be  this,  that 


the  mortgage,  so  far  as  it  is  a  charge  against  the  land.  Is 
extinguished  and  that  any  attempt  to  bring  the  land  Itself 
into  the  proceedings  would  manifestly  be  destroyed  by  the 
effect  of  said  sec.  63. 

"I  am  of  the  opinion  that  sub-sec.  16  (a)  of  sec.  1,  10 
Geo.  V.  1920;  ch.  3,  should  be  given  effect  to  in  the  pres- 
ent instance  by  allowing  the  mortgagee  to  proceed  upon  the 
covenant  and  to  issue  execution  thereon." 


COURSE  OP  RAILROAD  EARNINGS 


RediKtions    in    1921     Reflect    Falling    Off    in 
Linvering  of  Freight  Riites 


Traffic    and 


Gof  Canada,  shown  in  detail  elsewhere,  are  substan- 
ROSS  earnings  of  the  three  transcontinental  railways 
tially  lower  than  in  1920.  Ordinarily  they  reach  their 
peak  about  October  when  grain  traffic  is  heavy,  and  fall 
off  during  the  winter.  This  is  shown  by  the  following 
figures  for   1919: 

C.   P.   R.  Gd   Trunk        Can.   National 


January 
October     . 
December 


.$12,797,000 
.  19,113,000 
.    16,850,000 


$4,402,229 
9,540,544 
8,127,871 


$6,787,517 
9,542,328 
8,746,930 


A  similar  comparison 
follows  : 


for      1920      and     1921      is 


as 


1920 


January  . 
October  .  . 
December 

January  . 
October  .  . 
December. 


C.  P.  R. 
13,669,000 
24,607,000 
20,418,000 

14,208,000 
21,893,000 


Gd  Trunk 

5,054,030 

11,666,798 

10,855,482 


1921 


8,877,698 
9,743,332 


Can.  National 

7,267,562 

12,351,167 

12,434,075 

8,781,829 
11,691,881 


While  the  earnings  for  January,  1921,  were  well  in 
advance  of  those  in  January,  1920,  it  was  apparent  in  the 
case  of  the  Canadian  Pacific,  the  most  representative  of 
general  conditions,  that  the  increase  was  noi  as  great  as 
during  the  year  1919.  A  comparison  of  the  falling  off 
between  the  October  maximum  and  the  January  figures 
for  both  years  shows  this  even  better  : 


C.  P.  R. 
October,  1919  19,113,000 
January,   1920    13,669,000 


Decrease   .    5,4444,000 

C.  P.  R. 
October,  1920  24,607,000 
January,   1921   14,208,000 


Gd  Trunk 
9,540,544 
5,054,030 

4,486,514 


Can.  National 
9,542,328 
7,267,562 


2,274,766 

Gd  Trunk       Can.  National 

11,666,798  12,351,167 

8,877,698  8,781,829 


3,569,338 


Decrease    .    10,399.000  2,789,100 

Changes  in  Freight  Rates 

The  factor  of  rates  is,  of  course,  an  important  element 
in  these  changes.  The  increase  of  40  per  cent,  on  eastern 
lines  and  35  per  cent.  on  western  lines,  effective  in 
August,  19  20,  helped  swell  the  earnings  during  the  late 
months  of  the  year.  Five  per  cent,  of  this  was  lopped  off 
on    January    1,    1921. 


FARMERS'   BANK  ASSETS 

No  dividends  may  be  expected  by  shareholders  of  the 
defunct  Farmers'  Bank  of  Canada,  according  to  a  statement 
made  by  G.  T.  Clarkson,  the  liquidator,  last  February.  The 
most  that  the  assets  would  do,  he  said,  is  redeem  the  note 
issue,  and  provide  for  liquidating  expenses.  All  the  assets 
had  been  disposed  of  by  that  time,  with  the  exception  of  a 
few  judgments  of  doubtful  value  and  a  one-quarter  interest 
in  the  Cochrane  mining  claim  at  Cobalt,  which  miglit  have 
some  value. 


January  6.  1922 


THE       MONETARY       TIMES 


141 


THE  SIGNS  OF  THE  TIMES 


Tell  us,  emphatically,  to 
buy  long  term,  high  grade 
bonds— while  prices  are  yet 
low. 


In  1914  PROVINCIAL  GOVERNMENT  BONDS  were  selling  to  yield 
4%.  TODAY  the  YIELD,  at  the  market,  is  about  6Vs  but  today's  rates  are 
abnormal  and  bonds  may  be  expected  to  tend  back  to  the  old  yield.  Now  is 
the  time  to  buy  to  take  advantage  of  the  high  yield  and  the  prospective 
increase  in  price. 


ALLAN,  KILLAM  &  McKAY,  Limited 

BOND    DEALERS 

WINNIPEG,  Man. 


364   Main   Street 


Lougheed    &    Taylor, 

LIMITED 
CALGARY,    CANADA 

Cablei— Attorney. Calgary  Codes —Western  Union.   Benilcys 


LANDS 

Farms 

Ranches 

Calgary  City  Property 

INSURANCE 


BONDS 

Government 
Mvmicipal 
School 
Corporation 


General  Agents  for  Alberta — 

British  Traders  In.surance  Co.,  Limited 
Guardian  Insurance  Co.,  of  Canada 
Scottish  Metropolitan  Assurance  Co.,  Limited 


Lougheed    &    Taylor, 

I,IMITEI) 

210  Eighth  Avenue  West  -  Calgary,  Canada 


Cabli-   Addiess:      TOPECO 
Codes:     W»"8t.  Viilon  and  .'l.B.C.  5th  Edn. 


WILLIAM  TOOLE 
II.  S.   .lOVES 


CEO.  L.  I'EET 
A.  J.   TOOI.K 


K.   K.   A.   GRABl  RN 
S.    r..   J.    RORBIVS 


TOOLE,  PEET  &  CO. 

LIMITED 

FINANCIAL  AGENTS 

Appraisers     and     Valuators,       Private     Funds 
Invested,    Estates  Managed 

Caljfnry  Townsite  A^^nts 

(nniiillnn   riicinc   Riilluii\    Co. 

Invest iiicnt   Manajtei-s  for  .\ll)erta 

Inipt'iiiil   Lifr  A^Mininco   Co.   of  Canada 
(oiniiirrrlal    I  nion   ANMiranre   Co.,   Limited 
Kdlnbiirnli    t-if"*    V^-'-iirjtnrp   Co. 

Agents  for 

Alllanrr    \»»irniiin'   ( n..   I.lmlird 
Brlll-h   Amrrira   A-.Miranrr  Co. 

Coiniiirrciiil   I'lilon    \*.s|iran(-r   V.o.,   Llmitrd 

llnmi"  ln>>iiiiinir   ( n..  iif  \.  V. 
Insiiriinrr   Co.   and   Nnrtli   Amrrlra 
Ocriiii    \rrldrnt   and   (■iiariintcc  Corporalloo 
Ro>iil   Inviinini-f   (o..   I.linitrd 
Scotl!-h   I  nIon  and   Nationnl   Insuranrc  Co. 
Canudlan  Siirel)   Co. 

Lloyds   AKt'nts    (London). 

CALGARY,  ALBERTA,  CANADA 

Provincial   Manajters  for  .-Vlborta  and  Saskatchewan 

UNION  INSURANCE  CO   OF  CANTON 


142 


THE       MONETARY      TIMES 


Volume  68 


Some  Lessons  From  the  Stock  Exchanges 

Buying  on  a  "Hunch"  Is  Almost  Always  Disastrous — A 
Comparison  of  Real  and  Market  Values — ^Market  Is  Best 
Judge      of      Values,      But      Sometimes      It      Is      in      Error 

BY  JOHN  8.  WATTS 


At  the  end  of  each  year  it  is  commendable  practise  to 
take  stock  of  our  position,  and  calculate  the  gains 
and  losses  made  during  the  year,  finally  striking  a  balance 
sheet  enabling  us  to  compare  our  present  position  with  that 
of  a  year  ago.  This  work,  while  very  essential,  should  be 
regarded  as  only  a  beginning  towards  the  really  important 
one  of  studying  the  errors  and  omissions  we  have  been 
guilty  of  during  the  year,  which  have  prevented  us  from 
profiting  from  the  available  opportunities  we  have  had,  as 
much  as  we  might  have  done.  Probably  there  is  no  class 
who  can  recite  with  more  sincerity  that  part  of  the  prayer 
"we  have  done  those  things  which  we  ought  not  to  have 
done,  and  we  have  left  undone  those  things  which  we  ought 
to  have  done,"  than  the  investor  in  stocks,  the  things  done 
or  undone  in  his  case  being  the  stocks  bought  or  unbought. 

The  point  is  that  at  the  end  of  the  year,  we  have  an  ex- 
cellent opportunity  to  study  the  fluctuations  of  the  stock 
market,  and  profit  by  our  mistakes,  by  learning  the  reasons 
why  certain  stocks  have  not  appreciated  that  at  the  time  we 
bought  them,  were  in  our  opinion  due  to  rise,  and  how  it 
happened  that  other  stocks  which  we  had  neglected  did  go 
up.  Without  such  study  it  is  useless  to  expect  to  be  able 
to  do  any  better  in  the  future,  while  with  the  knowledge 
to  be  gained  by  a  reasoned  analysis  of  the  market  at  a  date 
sufficiently  later  than  the  actual  movement  under  con- 
sideration to  ensure  having  all  the  data  bearing  upon  it. 
we  may  expect  to  be  able  to  forecast  the  action  of  the 
market  more  accurately  each  succeeding  year,  with  a  fin- 
ancial success  well  warranting  the  time  spent  upon  study. 

I  cannot  emphasise  too  strongly  the  fact  that  the  buying 
of  stocks,  most  particularly  on  margin,  on  the  strength  of 
a  hunch,  may  lead  to  an  occasional  gain  but  if  continued 
the  gains  will  infallibly  be  wiped  out  by  the  losses.  Indeed 
unless  one  is  prepared  to  spend  a  fair  amount  of  time  and 
thought  in  studying  the  market,  it  would  be  better  to  stay 
out  of  the  game,  and  no  superficial  study  will  be  any  use, 
real  success.  dem,anding  a  thorough  and  wide  knowledge  of 
all  the  factors  bearing  upon  the  value  of  any  particular 
stock. 

R«al  and  Market  Value 

There  are  practically  always  two  values  for  any  listed 
stock,  namely  the  real  value,  that  is  the  price  at  which  the 
stock  would  be  selling  if  it  was  possible  to  know  definitely 
what  dividends  would  be  paid  upon  it,  during  the  next  few 
years.  Obviously  If  the  earnings  of  the  stock  in  the  next 
few  years  could  be  accurately  forecasted,  and  also  the  av- 
erage rate  of  'interest  paid  for  capital  invested  under  like 
conditions  during  that  time,  it  would  be  simple  arithmet- 
ical calculation  to  determine  the  price  that  should  be  paid 
for  such  a  stock  to  earn  this  average  return,  this  price  be- 
ing what  I  call  the  real  value  of  the  stock. 

The  other  value,  is  the  present  market  price  of  the 
stock,  and  is  practically  speaking  the  average  of  what  the 
investing  public  considers  to  be  the  real  value  of  the  stock 
as  defined  above.  The  difference  between  these  two  values, 
is  a  measure  of  the  inability  of  the  Investing  public  as  a 
whole  to  accurately  foretell  the  future  of  that  stock,  and  it 
is  by  his  ability  to  more  clearly  trace  ahead  the  probable 
course  of  events  that  the  real  investor  Is  enabled  to  profit 
by  the  errors  of  the  general  public. 

The  difference  between  these  two  values  represents 
a  sure  profit  to  the  one  who  can  most  accurately  determine 
the  real  value  of  a  stock,  and  as  in  every  slump  the  bulk 
of  all  the  stocks  fall  far  below,  and  In  every  boom  rise  far 
above  this  real  value,  there  is  ample  scope  to  earn  profits 
more  than    commensurate    with  the  time  and    ability  re- 


quired to  enable  one  to  appreciate  the  real  value  of  a  given 
stock  with  more  accuracy  than  the  average  man  who  mere- 
ly dabbles  in  stocks. 

Wide   Difference 

It  would  seem  that  when  the  market  price  is  fixed  by 
the  considered  opinion  of  its  real  value  of  a  large  number 
of  people  who  have  backed  up  this  opinion  by  risking  real 
money,  that  there  could  not  well  be  much  difference  be- 
tween the  two  prices,  as  the  composite  intelligence  of  this 
body  of  people  would  arrive  at  an  average  price  at  least 
approximating  the  real  value.  Experience  in  the  stock 
market  however  proves  beyond  a  shadow  of  doubt,  that 
while  the  price  of  a  stock  will  on  the  whole,  taken  over  a 
considerable  period  of  time,  average  up  around  its  true 
value,  it  will  during  the  same  time  fiuctuate  widely  both 
over  and  under  this  value.  The  action  may  be  described 
as  a  continual  hunting  by  the  market  price  for  the  true 
value  of  the  stock,  accompanied  by  continual  over-sbooting 
of  the  mark  in  both  directions. 

The  effect. of  a  shrinkage  in  the  amount  of  liquid  cap- 
ital available  for  investment  or  speculation  such  as  we  have 
had  this  past  year,  is  to  cause  a  fall  in  the  market  prices 
of  all  stocks,  but  in  this  connection  it  must  not  be  forgot- 
ten that  this  scarcity  of  capital  also  reduces  the  true  value 
of  all  stocks,  as  when  money  is  scarce  it  will  demand  and 
receive  a  larger  return  in  interest.  In  estimating  the  true 
value  of  stocks,  it  is  therefore  essential  to  study  the  pos- 
sibility of  this  value  being  affected  by  a  scarcity  or  pleni- 
tude of  capital  in  the  near  future. 

Rate  of  Interest 

When  money  is  Invested  with  a  view  simply  to  the 
interest  return  in  dividends,  this  fiuctuation  in  the  supply 
of  capital  is  unimportant,  as  the  laws  of  supply  and  de- 
mand will  dictate  the  rate  that  can  be  earned,  and  the 
movements  in  the  future  market  price  of  the  stock  are  of 
little  concern  if  the  stock  is  not  intended  to  be  sold.  For 
the  speculative  investor  the  future  price  Is  of  paramount 
importance,  and  the  bearing  of  this  matter  of  the  supply 
of  capital  is  that  it  will  affect  the  future  price,  and  while 
the  price  of  a  stock  may  be  low  to-day  having  regard  to 
the  return  being  received  for  capital  to-day,  the  same  price 
may  be  too  high  in  a  year  from  now,  if  capital  is  then 
gaining  through  scarcity  a  greater  rate  of  interest  than  it 
is  today.  If  on  the  other  hand  capital  is  more  plentiful 
next  year,  then  the  true  value  will  be  even  higher  than  it 
is  now. 

The  only  other  tactor  affecting  the  real  value  of  a 
stock  is  Its  ability  to  pay  dividends,  and  the  amount  of  such 
dividends.  This  factor  is  determined  by  the  efllciency  of 
the  management  of  the  company,  their  control  of  the  es- 
sential raw  materials,  and  the  attitude  of  the  labor  em- 
ployed, that  is  whether  it  is  of  a  class  that  is  easily  misled 
by  agitators  into  wasteful  and  costly  disputes,  or  is  of  a 
class  that  is  sufliciently  intelligent  to  be  able  to  negotiate 
a  fair  and  proper  agreemet  with  its  employers  without  first 
involving  both  sides  in  disastrous  losses. 
Barning  Power 

Both  of  these  factors  are  best  appreciated  as  to  their 
future  effect  by  a  study  of  the  company's  history,  judg- 
ing from  what  has  happened  in  the  past,  what  is  likely  to 
occur  under  given  conditions  in  the  future.  In  so  far  as 
regards  the  supply  of  capital,  it  seems  that  from  past  ex- 
perience we  may  expect  a  fairly  regular  fluctuation  in  the 
supply,  having  a  period  of  around  seven  years  from  one 
time  of  scarcity  to  the  next.  The  second  factor,  that  of 
the  ability  to  earn  dividends,  which  is  the  more  important 


January  6,  192Z 


rHE       MONKTAKY       TIMKS 


143 


The  Manitoba  Farm  Loans  Association 

6%   First    Mortgage    Farm    Loans    Bonds 


At  a  time  when  the  public  is  being  attracted  from  other  in- 
vestments to  Dominion  and  Provincial  Government  Bonds,  these 
short  term  (one  to  ten  year)  Bonds  are  particularly  attractive, 
the  security  being  of  the  highest  class.  They  are  issued  in 
denominations  of  any  amount  from  $25.00  upwards  to  suit  pur- 
chasers, and  are  fully  guaranteed  as  to  payment  of  principal  and 
interest  by  the  Province  of  Manitoba. 

For  further  information,  rates  of  commission,  etc.,  bond 
dealers  are  invited  to  correspond  with 

THE  MANITOBA  FARM  LOANS  ASSOCIATION, 

Winnipeg,  Manitoba. 


L.  McNeill,  Commissioner 


C.  P.  L.  FOWLER,  Secretary 


The  British  Columbia  Land 
and  Investment  Agency 

Limited 

LONDON,  England,  and  VICTORIA,  B.C. 

Established  in  British  Columbia,  1863 

FINANCIAL,  REAL  ESTATE 
AND  INSURANCE  AGENTS 
EXECUTORS  AND  TRUSTEES 

ESTATES    MANAGED 
MORTGAGE      INVESTMENTS 
RENT     COLLECTIONS,     ETC. 

Heiul  Office  for  British  Oolniiibiu: 

922  Government  Street,  Victoria,  B.C. 


THE 

Canada   Standard 
Loan    Company 


Winnipeg  Investments,  to  yield  8''* 
handled  and  guaranteed  for  clients 

SIX  PER  CENT. 
DEBENTURES 

Interest  payable  half-yearly  at  par 
anywhere  in  Canada 


IWRTICILARS      ON      .\PPLIC.1.T10N 


520  Mclntyre  Block,    Winnipeg 


144 


THE      MONETARY      TIMES 


Volume  68 


factor,  can  be  estimated  only  from  a  study  of  the  past 
performance  of  the  company,  and  of  any  changes  in  the  sit- 
uation which  may  occur  in  the  future  and  which  would 
affect  this  ability  either  adversely  or  otherwise. 

It  may  be  argued  that  what  we  really  want  to  know  is, 
what  the  market  price  will  be  in  the  near  future,  and  cer- 
(tainly  it  would  be  very  desirable  to  have  this  knowledge, 
as  the  man  who  could  guess  the  market  right  even  only 
seventy  times  out  of  a  hundred  would  in  a  few  years  own 
every  stock  that  is  on  the  market.  The  market  price, 
however,  is  governed  altogether  by  the  opinions  of  the  in- 
vesting and  speculating  public  as  a  body,  and  is  subject 
to  no  rules  or  laws  from  which  we  could  judge  the  prob- 
able movement  of  any  stock  except  that  sooner  or  later  a 
stock  will  sell  at  or  around  its  true  value. 

The  risk  of  margining  a  stock  with  the  whole  of  one's 
available  capital  is  too  great  to  be  considered  as  anything 
but  gambling,  as  it  is  impossible  to  foretell  what  the  opin- 
ion of  the  whole  investing  public  will  be  of  any  particular 
stock  during  the  month,  and  hence  it  is  essential  to  be  able 
to  carry  on  through  a  sudden  drop  by  putting  up  additional 
margin  or  collateral.  The  only  possible  way  to  reap  a  per- 
manent profit  is  by  intelligent  study  of  the  intrinsic  values 
of  stocks  and  their  purchase  -with  the  intention  of  holding 
until  this  value  is  reached  or  the  course  of  events  proves 
that  our  original  reasoning  was  in  error,  in  which  event 
our  action  should  be  based  on  the  later  information  that 
time  has  brought  forth. 

With  a  clear  understanding  of  the  fact  that  the  profit 
to  be  earned  on  a  speculative  investment  is  dependent  upon 
the  speculator's  ability  to  accurately  estimate  the  real 
value  of  stocks,  and  is  measured  by  the  difference  between 
the  real  value  and  the  present  market  price,  we  are  in  a 
position  to  profit  by  past  experience  and  by  reviewing  our 
forecasts  from  time  to  time  in  the  light  of  what  actually 
did  hapen,  should  advance  steadily  in  the  ability  to  profit- 
ably invest  in  stocks  that  are  selling  below  their  true  value.  ' 

Then  again,  if  a  stock  is  purchased  or  margined  on  a 
reasoned  analysis  of  the  situation,  one  is  less  likely  to  be 
infiuenced  by  any  sudden  slump  in  the  market,  and  in  a 
panic  sell  at  a  loss  when  by  holding  on  for  a  while  the  ex- 
pected profit  would  be  realized.  Indeed,  having  once 
bought  a  stock,  nothing  should  induce  one  to  sell  at  a  lower 
price  than  that  originally  estimated  as  the  real  value,  as 
experience  proves  that  all  upward  or  downward  movements 
are  always  carried  further  than  the  facts  warrant,  that  is  a 
stock  will  always  go  higher  than  its  real  value  in  a  bull 
market,  and  lower  in  a  bear  maket.  Nevertheless,  to  be  on 
the  safe  side,  it  is  good  policy  to  confine  oneself  to  the 
profit  to  be  made  by  selling  at  this  real  value,  notwithstand- 
ing that  it  will  probably  go  further.  Of  course,  while  wait- 
ing for  this  price  to  be  reached  it  may  happen  that  events 
will  prove  our  original  estimate  to  be  in  error;  in  which 
case  our  only  recourse  will  be  to  review  our  estimate,  and 
shape  our  action  in  accordance  with  the  later  informa- 
tion. The  main  point  being  that  we  should  not  allow  the 
fluctuations  of  the  market  to  affect  our  judgment,  but  only 
have  regard  for  aujthentic  information  bearing  on  the  real 
value  of  the  stock. 

Market  Sometimes  Errs 

There  is  a  theory  quite  generally  held,  that  the  stock 
market  is  always  right,  as  witness  the  quite  common  com- 
ment that  a  certian  stock  is  falling  on  the  market,  and  that 
therefore  the  dividend  must  be  going  to  be  passed.  That 
this  theory  is  totally  in  error,  there  are  numerous  instances 
during  the  past  year  to  prove.  To  cite  a  few,  take  Steel 
Co.  of  Canada,  which  on  a  rumor  that  the  next  dividend 
was  to  be  passed,  fell  to  42%,  but  in  a  few  weeks  climbed 
back  to  around  59.  Another  case  we  have  in  Lyall  Con- 
struuction,  which  dropped  to  35  in  a  similar  panic,  and  is 
now  selling  at  63.  Still  another  is  shown  by  the  action  of 
Steamships  Preferred,  which  tell  to  38  but  quickly  reacted 
to  50. 

Now  in  any  of  these  stocks  and  particularly  in  the  first, 
a  study  of  the  affairs  of  the  company  as  published  and 
available  to  any  investor  would  show  that  the  dividends 
were  not  In  any  real  danger,  or  at  most  only  temporarily 


so,  and  the  sacrifice  of  these  stocks  at  such  low  prices  can 
only  be  attributed  to  one  of  two  causes.  Namely  to  an 
unreasoning  panic  on  the  part  of  some  of  the  holders, 
caused  by  their  having  more  faith  in  the  opinion  of  the 
market,  than  in  their  own;  or  because  of  the  stock  being 
held  on  margin,  and  the  inability  of  the  speculator  to  pro- 
vied  more  margin  to  protect  his  holdings  against  just  such 
unwarranted  slumps.  To  the  first  the  only  possible  advice 
is  that  if  a  man  has  not  the  courage  of  his  opinions,  he 
had  better  stay  out  of  the  market,  or  be  content  with  the 
five  or  six  per  cent,  return  on  bonds,  although  even  then 
he  may  lose  if  he  does  not  display  more  intelligence.  To 
the  second,  the  experience  of  the  past  year  should  be  suf- 
ficient to  convince  him  of  the  folly  of  margining  to  the 
last  dollar.  This  last  type  is  the  man  who  is  mainly  re- 
sponsible for  the  extreme  fluctuations  of  the  stock  ex- 
change, but  as  it  is  largely  from  his  contributions  that  the 
more  cautious  investor  gains  his  profits,  it  ill  behooves 
us  to  be  too  sarcastic  about  him  lest  he  fail  to  return  to 
the  shearing  when  he  has  accumalated  another  crop  of  wool. 
Broad  Movements  Significant 

Notwithstanding  that  the  minor  and  temporary  fluctu- 
ations in  the  price  of  single  stocks  are,  as  I  have  shown, 
very  unreliable  as  indications  of  the  future  prospects  of 
that  particular  stock,  it  cannot  be  gainsaid  that  the  broad 
movements  of  the  stock  market  as  a  whole,  are  quite  ac- 
curate fore-runners  of  the  state  of  business  that  may  be 
expected  to  arrive  at  some  period  varying  between  three 
to  six  months  in  the  future.  This  past  year  is  an  example 
of  this  prescience  of  the  market,  as  we  had  a  steadily 
falling  market  from  the  first  of  the  year,  reaching  Its  low 
point  about  July.  As  is  well  known  the  general  state  of 
business  gradually  got  worse  from  the  first  of  the  year, 
and  continued  to  do  so  until  about  October.  Judging 
from  the  fact  that  the  market  commenced  to  rise  slotvly 
in  August,  we  may  expect  to  see  a  slow  revival  in  business 
commencing  in  earnest  about  the  end  of  this  year. 

The  bearing  of  this  action  of  the  stock  market,  fore- 
telling the  state  of  business,  to  the  investor,  is  that  if  the 
information  at  his  disposal  points  to  a  change  in  the  state 
of  business  he  may  look  for  this  to  be  anticipated  by  the 
stock  market  rising  or  falling  as  the  case  may  be  some 
months  ahead  of  the  actual  change.  In  fact  this  broad 
movement  of  all  listed  stocks  in  anticipation  of  a  revival 
or  slump  in  business  is  simply  the  effect  of  the  anticipa- 
tion on  the  part  of  the  body  of  the  investing  public  of  this 
very  change  in  the  state  of  affairs.  The  accuracy  of  this 
movement  in  the  prices  of  stocks  is  therefore  neither  more 
or  less  accurate  than  the  ability  of  the  investing  public  to 
foresee  the  future,  and  is  dependent  upon  the  Intelligence 
of  these  people  entirely. 

One  more  point  is  the  wisdom  of  avoiding  the  tempta- 
tion to  buy  simply  because  a  certain  investment  is  selling 
cheap.  That  is  the  investing  of  money  in  something  that 
is  selling  at  a  much  lower  price  than  it  has  previously, 
on  the  general  principle  that  it  is  sure  to  come  back  in 
time.  An  example  of  this  is  the  gambling  in  German 
Marks  which  was  largely  done  on  the  single  assumption 
that  being  so  tar  below  their  normal  rate  they  could  not 
well  fall  lower,  and  that  with  a  return  to  normal  times 
they  woulJ  rise  to  nearer  par.  There  is  in  this  country 
too  little  data  available  fo  intelligent  anticipation  of  the 
probable  course  of  exchange,  and  in  any  case  the  problem 
of  international  currency,  being  world  wide  in  its  impli- 
cations, is  too  big  for  the  average  investor.  From  present 
indications  I  would  look  for  a  still  further  depreciation 
in  German  securities,  indeed  I  expect  that  next  year  Ger- 
many will  be  in  the  throes  of  a  financial  crisis,  which  will 
involve  the  loss  of  any  money  invested  in  that  country. 
The  lesson  from  this  experience  is  to  confine  ones  invest- 
ments to  affairs  of  which  it  is  possible  for  us  to  have 
sufficient  knowledge  to  form  an  intelligent  opinion,  and 
that  no  matter  how  much  lower  the  price  of  a  certain  in- 
vestment may  be  than  it  usually  is,  its  real  value  may 
quite  possibly  be  still  less,  and  without  some  actual  know- 
ledge of  what  this  real  value  Is,  we  have  no  business  to 
touch  it. 


January  fi,  1922 


THE       MONETARY       TIMES 


145 


THE  GREAT  WEST  PERMANENT 

LOAN  COMPANY 


HEAD  OFFICE 


WINNIPEG, CANADA 


OUR  RECORD  GROWTH 


In  1903 
In  1920 


I'ald  ii|) 


Hrsei'VPs 


Avspts 


$110,295.92  $27,767.21 

$2,414,663.60  $1,100,000.00 

BOARD  OF   DIRECTORS 

President , 

W.   T.  ALEXANDER 
MAJOR   D.    E.    SPRAGUE,    O.B.E.  E.  L.  TAYLOR,  K.C. 

J.  H.   G.  RUSSELL  W.  J.  BOYD 

COL.  The  HON.  A.  C.  RUTHERFORD,  K.C. 
P.  H.  ALEXANDER,  Secretary 


$160,574.29 
$6,184,420.61. 


S.  D.  LAZIER 

DR.   A.   D.   CARSCALLENf 


BRANCHES  AT 

TORONTO,   CALGARY,    EDMONTON,    REGINA,   VANCOUVER,    VICTORIA 
LONDON,   ENG.,     EDINBURGH,   SCOT. 

SHORT  TERM  DEBENTURES  ISSUED   TO    YIELD   S^i^ 
4'ja  Interest,    compounded  quarterly,     allowed    on    Savings    Deposits 


THE 

EMPIRE    LOAN    COMPANY 

WINNIPEG,    MAN. 

Issues  Debentures  at 
current  rates,  amply  se- 
cured by  the  deposit  of 
mortgages  with  a  trustee 


BOARD  OF  DIRECTORS 

Chas.   M     Simpson,   President. 

Wm.   Brydon,   Vice-President. 
H.  H.  Beck,  Johnston  Douglass, 

Richard  MacKenzie,  A.  N.  McPherson. 


Manager: 
Chas.  M.  Simpson 


Secy.-Treas. : 
S.  T.  Jones 


.Authorized  Capital $5,000,000 

Subscribed  Capital  676,800 

Paid  Up  Capital  and  Surplus      735,000 
Assets  (approximately) 900,000 


FIRST     MORTGAGE     LOANS 

MUNICIPAL    AND    GOVERNMENT 

BONDS 


DOMINION   LOAN 

AND 

SECURITIES  COMPANY.  LTD. 

200  STERLING  BANK  BUILDING 
WINNIPEG 


E   E    HA       .   Pres. 

W.    !•.    RILEY,   Vlre  Ires. 


IS.\.\C    PITBL.MK),    Vlce-Prei. 
U   1.   HALL,   Treasurer 


Correspondents 

.Montreal,    Toronto 

New   York.    Chicago 

l.ondon.  Eng. 

Correspondence  Invited. 


146 


THE       MONETARY       TIMES 


Volume  68 


LAND  SETTLEMENT  AND  IMMIGRATION 


Problem  Is  Now  Complicated  By  National  Railway's  Needs — 
The    Western    Canada    Colonization    Association 


BY  G.  W.  AUSTEN 

A  YEAR  or  two  ago  an  organization  named  the  Western 
Land  Colonization  Association  was  formed.  Its  ob- 
ject was  to  procure  settlers  to  take  up  well-located  idle 
lands  in  the  West,  and  to  help  them.  Nearly  a  million  and 
a  half  dollars  were  subscribed  by  leading  Western  and 
Eastern  men.  But  the  Association  is  almost  at  the  point 
where  it  started.     What  is  the  matter? 

The  explanation  is  not  hard  to  find.  Soon  after  the  As- 
sociation was  formally  organized,  It  obtained  a  general 
manager,  Brig-General  McRae.  A  few  months  later  he 
quit.  The  Association  was  put  up  against  the  stone  wall 
of  land  speculation.  It  found  that  it  had  no  stable  assur- 
ance of  reasonable  prices  for  land  sought  settlers  and  pur- 
chasers for.  Settlement  creates  land  value,  naturally,  and 
as  soon  as  owners  found  that  the  Association  was  figuring 
on  their  land,  or  land  in  the  neighborhood,  they  began  to 
think  their  holdings  worth  considerably  more.  The  activi- 
ties of  the  Association  threatened  to  hoist  it  with  its  own 
petard. 

Compulsion  Is  Necessary 

The  Association  then  declared  a  suspension  of  opeera- 
tions.  It  had  a  sort  of  promise  from  the  Manitoba,  Sas- 
katchewan, and  Alberta  Governments  that  they  would  ap- 
ply some  sort  of  a  "big  stick"  to  the  owners  of  vacant  lands. 
But  until  legislation  is  passed,  at  the  present  sessions  of 
the  Legislatures,  nothing  effective  is  possible.  The  Assoc- 
iation wants  Acts  compelling  owners  of  idle  land  desired 
for  settlement  to  put  a  price  on  their  holdings,  this  price 
to  be  made  the  basis  for  a  sliding  scale  of  taxation.  The 
Governments  are  favorable,  in  principle,  but  in  the  West 
land  speculation  has  been  one  of  the  chief  industries,  and 
they  fear  to  offend  the  powerful  interests  that  resent  such 
"confiscation."  There  are  large  mortgage  companies,  and 
big  land  holding  companies  that  would  be  very  adversely 
affected  by  any  scheme  to  pry  their  vacant  farm  lands  loose 
at  a  reasonable  price, — a  price  that  would  enable  settlers 
to  finance  them — and  also  many  of  the  big  farmers.  The 
Governments  do  not  feel  comfortable  at  taking  so  many 
powerful  influences  by  the  neck,  in  the  interests  of  the 
whole  community. 

This  particular  condition  has  a  vital  interest  for  all 
Canada,  for  the  West  is  hard  hit  by  low  grain  prices,  low 
cattle  prices,  and  the  Young  Emergency  tariff.  If  land 
values  are  held  abnormally  out  of  line,  by  the  speculators, 
the  inflow  of  new  settlement  will  be  badly  checked.  The 
idle  20,000,000  acres  of  land  suitable  for  settlement,  and 
close  to  the  railways,  will  remain  idle.  Our  railway  prob- 
lem will  remain  largely  as  it  is.  Canadian  manufacturing 
will  be  badly  checked,  and  Ontario  and  Quebec  will  suffer. 
The  biggest  uplift  Canada  can  get,  economically,  will  be 
from  the  settlement  of  our  idle  lands,  particularly  in  the 
West,  and  if  speculators  try  to  take  soil  off  that  settlement, 
under  present  conditions,  they  will  retard  the  whole  Dom- 
inion. The  remarkable  period  of  prosperity  that  Canada 
had  from  1900  to  1912  was  caused,  principally,  by  the 
opening  up  and  settlement  of  the  West.  The  lands  there 
were  tree.  Homesteading  was  the  thing.  After  the  home- 
steaders went  stores,  equipment  for  towns  and  villages,  and 
then  railroads.  The  great  railway  construction  era  that 
signalized  the  rapid  inflow  of  settlers  was  a  time  of  en- 
ormous expansion  for  Canada — of  over-expansion  so  far  as 
Transcontinental  lines  went.  The  sky  was  the  limit  in  the 
railway  gamble. 

Overcome  Railway  Deficit 

But  the  experience  of  Canada  then  is  sufllcient  illumina- 
tion to  point  the  way  for  us  now.  We  have  the  railways 
there.     As  bankrupt  lines,   the  Grand   Trunk   Pacific  and 


Canadian  Northern  were  taken  over  by  the  Government. 
In  the  last  two  or  three  months,  the  National  Railways  as 
a  whole  have  reported  an  operating  surplus,  but  fixed 
charges  will  leave  a  deficit  of  anywhere  from  $35,000,000 
to  $50,000,000,  even  If  the  operating  balance  is  on  the 
right  side  for  the  balance  of  the  fiscal  year.  Every  settler 
is  worth  about  $750  in  annual  re  venue  to  a  railway,  ac- 
cording to  C.  P.  R.  experience,  and  if  the  20,000,000  acres 
were  populated,  and  tilled,  there  would  be  a  million  new 
population  along  the  Western  railway  lines.  That  new 
settlement  would,  by  itself,  almost  enable  the  National 
Railways  to  pay. 

Not  alone  in  relieving  the  Dominion  treasury  of  perhaps 
$45,000,000  outlay  each  year  for  railway  losses,  but  in 
providing  business  to  manufacturers  and  workmen,  the 
settlement  would  work  an  economic  revolution.  The  ex- 
perience of  the  Soldiers  Settlement  Board  shows  an  average 
cost  of  about  $4,000  for  land  equipment.  About  $1,500  is 
required  for  stock  and  Implements  and  buildings  of  the 
simplest  character.  If  a  hundred  thousand  settlers  each 
spent  a  thousand  dollars  on  getting  equipment,  materials, 
etc,  the  hundred  million  dollars  of  business  would  radiate 
through  the  whole  business  world  of  Canada,  and  put  an 
entirely  different  aspect  on  the  sales  manager's  outlook. 
Some  of  the  Western  enthusiasts  have  figured  out  in  detail 
the  economic  benefits  of  such  an  extensive  settlement,  but, 
unfortunately  for  them,  the  practical  obstacles  in  the  way 
make  the  estimates  rather  useless.  The  thing  is  to  get 
the  land  under  option  at  reasonable  prices,  and  apparently 
nothing  but  compulsory  action  by  the  local  Governments 
will  be  sufficient. 

Small   Taxes  Now  In  BMfect 

The  Saskatchewan  and  Alberta  Governments  have  Idle 
land  taxation  now  in  effect,  amounting  to  one  per  cent  on 
the  assessed  value  of  the  idle  lands.  As  idle  lands  may 
be  assessed  at  $5  an  acre,  the  tax  is  accordingly  very  small. 
On  a  quarter  section  it  might  be  from  $5  to  $10  a  year. 
This  is  obviously  not  enough  to  compel  holders  to  let  go. 
Indeed,  with  the  comparative  depression  in  the  West,  poli- 
ticians do  not  want  to  compel  any  land  holders  to  let  go. 
Tax  sales,  liquidation,  and  plain  abandonment  of  land 
have  been  all  too  frequent.  Many  square  miles  of  land 
cl  se  to  the  cities  and  towns  has  reverted  into  "farming" 
land.     It  used  to  be  valuable  "suburban"  areas. 

Canada  will  begin  to  get  a  big  immigration  this  Spring, 
if  the  Government  is  willing.  The  British  Government  is 
anxious  to  help  the  British  unemployed  to  go  overseas  to 
the  Dominions,  and  to  Canada  in  paricular.  If  some  method 
is  completely  arranged  whereby  the  British  Government 
will  establish  big  farming  colonies  in  Western  Canada,  to 
receive  these  workers,  train  them  in  Canadian  agriculture, 
and  then  help  them  to  become  established  for  themselves, 
the  problem  of  Britain's  unemployed,  and  our  own  land 
settlement  difficulty,  would  be  relieved.  But  as  it  is,  the 
settler  who  wants  good  Western  land,  close  to  the  railways, 
must  be  prepared  to  pay  $35  to  $40  an  acre  for  it,  and  for 
160  acres  this  means  a  lot  of  money,  far  more  than  the  av- 
erage settler  can  spare.  We  want  cheap  lands,  available 
on  easy  terms,  and  then  Europe  and  the  United  States  will 
not  be  slow  in  filling  up  the  vacancies  In  the  "world's 
breadbasket." 


In  August,  1921,  Hon.  W.  E.  Foster,  Premier;  Hon.  J. 
P.  Byrne,  Attorney  General  and  Hon.  J.  E.  Micheaud.  Min- 
ister without  Portfolio,  were  named  as  the  three  members 
of  the  New  Brunswick  Government  to  become  a  board 
of  trustees  to  succeed  the  Prudential  Trust  Company  of 
Montreal  who  had  been  handling  securities  of  the  St.  John 
and  Qv.ebec  Railway  Co.  to  the  amount  of  $?'>'j  000. 


Early  in  1921  the  Vancouver  branch  of  the  Toronto 
General  Trusts  Corporation  moved  into  new  premises  at 
Pender  and  Seymour  Sts.,  the  new  property  costing  $150,- 
000.  Ewart  W.  Hards  was  also  appointed  secretary  of  the 
branch.     The  manager  is  G.  H.  Forbes. 


"f.1 


INSURANCE 


.Tuiuuiry   (1,    VxlZ. 


T  (I   K       .\1  I)  N   I-; 


1   M    H  S 


!<: 


14S  T  H  E       M  O  N  E  T  A  R  Y       T  I  M  E  S  Volume  G8. 


GROUP  ENDOWMENT  PLAN 

A  Pension — Endowment — Insurance 
Plan  for  Employers 

"What  shall  we  do  for  the  old  man?"  is  a  question  that  is  debated 
by  many  Employers  when  the  time  comes  to  retire  an  old  employee. 
The  Employer  who  comes  into  personal  touch  with  his  workers  has  a 
problem  to  solve  when  he  tells  an  old  man  that  his  services  are  no 
longer  required,  particularly  in  the  case  of  a  faithful  worker  who  has 
devoted  the  best  of  his  life  and  energies  to  the  interests  of  the  busi- 
ness. 

"Hou  call  \M-  liesl  recognize  the  ;i1)ility  and  service  of  our  emi)loyecs  and  stim- 
ulate tlieir  intoi'ost  and  co-operation  in  the  business?"  is  anotiier  problem  before 
Eni])l()yers  who  want  effieicnl  and  loyal  workers. 

'■  What  should  we  do  lor  tlie  widow  and  children  ui)on  total  disability  or  death  of 
an  employee  who  has  been  connected  with  the  business  for  some  time?"  is  also  a 
([uestion  that  faces  the  Em])loyer.  The  average  employee  does  not  save  and  the  few 
dollars  derived  from  passinj^  around  the  hat  is  a  poor  form  of  charity  and  cannot 
meet  the  needs  of  the  dependents. 

A    SIMPLE    SOLUTION 

Our  Group  Endowment  plan  puts  the  who's  matter  on  a  definite  business  basis.  It  offer.s 
a  simple  way  to  provide,- — 

X  RETIUEMKNT  FUND  for  employees  to  be  paid  at  time  of  the  retirement 
either  in  One  Sum  or  as  a  Pension  for  the  remainder  of  life,  or 

X  CO-OPER.A.TION  FUND  payable  in  10  or  15  years  to  promote  greater 
interest  in  co-operation,  to  hold  employees  who  are  worth  while,  and  to 
reward  ability  and  service 

IN  ADDITION 

The  plan  provides  for  Full  Payment  of  the  policy  to  the  assured  either  in 
One  Sum  or  Instalments,  in  event  of  total  disability  before  maturity  of  the 
policy 

MEANWHILE,  FROM  COMMENCEMENT, 

It  gives  insurance  protection  for  dependents  as  the  full  sum  assured  is 
payable  in  event  of  death  and  becomes  a  veritable  god-send  to  homes  of 
employees  who  die  without  leaving  any  other  pi'otection. 

A  ronti-ilution  on  a  50/50  basis  both  fi-oiii  Kiiii)loyer  and  Employees  involves  a 
very  modei'ute  investment  for  this  insuiance-pension  plan.  It  encoura^ics  thrift 
amoniisi  em|)l()yees.  It  gives  them  a  stake  in  the  business.  It  will  tend  towards 
jireater  loyalty  and  co-operation.     It  is  an  investment  that  ))ays. 

Ask  for  Particulars. 

CANADA    LIFE   ASSURANCE   COMPANY 

HEAD  OFFICE        -        TORONTO 


January   6,   1922. 


THE      MONETAUY      TIMES 


M» 


New  Life  Business  Fell  Off  in  1921 


Cancellations  Follow  Deflation  in  Values — Total  Business  Written 
About  Twenty  Per  Cent  Less  Than  in  1920 — Policy 
Loans     Increased — Mortality     Much     Lower     Than     in     1920 

(CONTRIBUTKD) 


IN  the  history  of  Life  Insurance  operations  in  Canada, 
the  year  1921  must  l)e  recorded  as  a  memorable  chap- 
ter of  depression  in  all  kinds  of  business,  through  post- 
war Beadjustment  of  all  branches  of  industry  and  com- 
merce, us  well  as  finance,  throughout  the  world,  causing 
the  well-known  deflation  in  values  and  conseiiuent  scarcity 
of  employment,  and  very  largely  reduced  circulation  of 
money. 

After  the  phenomenal  expansion  In  Life  Ini^urance 
business  beginning  in  1918  and  continuing  through  1919 
and  1920 — the  latter  proving  to  be  the  greatest  of  all 
Life  Insurance  years  on  this  Continent,  when  It  was  gen- 
erally believed  that  a  new  era  in  the  business  had  been 
entered  upon.  It  began  to  b  evident  towards  its  close  that 
th  remarkable  advance  had  reached  its  peak,  and  the  ex- 
perience during  the  first  quarter  of  1921  revealed  that 
the  slow  but  steady  process  of  deflation  was  being  felt  in 
all  business  circles.  Before  the  end'  of  the  first  half- 
year  business  conditions  had  so  materially  changed  that 
cancellations  had  beocme  the  order  of  the  day,  with  a 
steady  falling  oft  in  the  monthly  volumes  of  business 
written,  and  the  crops  not  promising  to  be  as  good  as  In 
previous  years,  the  companies  all  over  the  Continent 
began  to  place  their  houses  In  order  and  devote  strenuous 
efforts  to  conserving  the  business  already  on  their  books, 
realizing  that  this  was  more  essential  even  than  writing 
new  business. 

So  long  as  money  continued  to  circulate  freely  the 
high  everages  established  In  1919-'20  were  maintained; 
and  while  the  benefits  of  Life  Insurance  learned  froTV 
the  lessons  of  the  Great  War  and  the  epidemic  which  Im- 
mediately followed,  tending  to  promote  larger  writings, 
were  none  the  less  influential,  the  changed  labor  condi- 
tions accompanied  by  scarcity  of  money,  compelled  large 
numbers  of  people  wha  had  taken  out  comparatively  large 
policies  when  their  circumstances  were  good,  to  cancel 
maney  of  these  because  they  could  no  longer  carry  them. 
Terminations  became  heavier  as  the  year  advanced,  and 
naturally  the  demand  for  policy  loans  Increased  with  all 
the  companies,  and  instead  of  each  month's  business 
showing  a  considerable  Increase  over  the  corresponding 
month  of  1920,  the  reverse  was  the  geenral  experlnce. 

E.stlmato  fop   1921 

While  at  this  writing  (December  20),  the  final  re- 
turns of  none  of  the  companies  are  yet  available,  as  nearly 
as  can  be  roughly  estimated,  the  total  amount  of  new 
business  Issued  and  paid  for  in   Canada  In  round  numbers 

..  1  approximate  1510,000.000,  against  $641.- 
77»,095  for  1920 — showing  a  reduction  of  a 
fraction  over  20%  or  $131.000,000 — and  com- 
pared with  $.524,000,000  for  1919;  and  $313.- 
000.000   for   191S. 

The  reduction  in  the  total  of  new  business  written 
during  last  year  as  compared  with  1920  was  therefore 
about  equal  to  the  total  increase  written  in  1920.  com- 
pared with  1919;  but  in  1919  the  increase  over  the 
amount  written  In  1918  in  Canada  was  about  lOOc,.  So 
that,  assuming  that  the  major  pjortion  of  the  old  business 
was  retained  on  their  books,  the  Life  companies  will  be 
better  off  financially  than  many  of  them  were  a  year 
ago.  At  the  close  of  1920  the  total  amount  of  Insurance 
In  force  in  Canada  had  been  more  than  doubled  during 
the  previous  six  years,  and  rekched  the  huge  sum  of  $2.- 
500,000,000,  most  of  which  had  been  gained  during  1919 
and   1920. 


The  mortality  experienced  during  1920  was  generally 
considered  favorable.  In  most  cases  less  than  50%,  and  in 
1921  it  was  still  more  favorable  as  reported  by  nearly 
all  the  companies.  It  has  been  authoritatively  stated  that 
last  year  was  one  of  the  most  healthy  in  all  the  coun- 
tries in  the  world,  especially  In  America,  so  that  while 
the  year's  annual  reports  will  show  in  almost  all  cases 
a  falllng-off  in  the  volume  of  new  business  written,  of 
from  15  to  25,  and  in  some  cases  30  per  cent,  compared 
with  1920,  the  ratio  of  expenses  was  considerably  lower 
than  in  the  previous  year — the  proportion  of  the  first 
year's  business  being  smaller  than  the  renewals,  as  com- 
pared with  1920,  which  augured  well  for  the  financial 
results  and  enabled  those  companies  whose  surpluses 
were  seriously  reduced  during  the  later  war  years  to  at 
least  partially  restore  them.  It  was  also  a  good  year  for 
investments,  there  being  a  choice  lot  of  long-term  bonds 
yielding  a  good  rate  of  interest  available  daring  the  year. 

Net  Amount  Life  Insurance  in  Force 

5000- 


V  E  A  R 

affording  the  companies  more  than  usual  opportunities  tor 
increased  earnings  and   making  money. 

The  collection  of  premiums,  especially  in  the  North 
West,  was  much  smaller  in  amounts  last  year,  and  the 
total  of  outstanding  interest  accounts  will  show  a  consid- 
erable increase  as  compared  with  1920.  On  the  whole, 
notwithstanding  that  field  men  found  their  tasks  in  selling 
Insurance  more  difficult  than  in  1920,  and  the  total  rel- 
ume of  business  showed  a  marked  falling  oft.  the  yeaf  Is 
regarded  as  quite  satisfactory;  practically  all  the  com- 
panies have  Increased  their  financial  strength,  and  enter 
upon  the  new  year  with  optimistic  views  as  to  the  future. 
While  the  closing  months  of  1921  proved  an  exception  In 
the  experience  of  the  companies  to  the  general  rule — that 
business  Increases  towards  the  end  of  the  year — there 
never  was  a  time  in  its  history  when  Life  Insarance  was 
more  appreciated,  because  better  understood,  by  the  gen- 
eral public. 


150 


THE       MONETARY       T  I  M  E  S 


Volume  68. 


When  business  conditions  generally  improve,  and  ttiey 
are  reported  to  be  already  much  better,  it  is  believed  that 
Life  Insurance  will  again  be  written  in  record  volumes. 
Even  now  there  are  a  few  of  the  great  world  companies 
in  Canada  reporting  a  larger  volume  of  business  for  1921, 
with  larger  incomes  and  increases  of  the  total  amounts  in 
force,  than  at  any  time  in  their  history.  For  instance: 
The  Sun  Life  reports  having  written  $100,00(5,000  for  last 
year;  the  Canada  Life  reports  having  written  over  $70,- 
000,000,  showing  a  total  increase  of  some  $7,000,000,  of 
which  over  $2,000,000  represented  the  increase  in  Can- 
adian business;  the  Manufacturers  Life  reported  a  vol- 
ume of  over  $50,000,000,  and  the  Confederation  Life, 
North  American  Life,  and  Mutual  Life,  similar  amounts. 
But  while  Canada  may  well  be  proud  of  such-  giant  com- 
panies, they  are  the  exception  to  the  general  rule.  The 
fact  that  these  great  corporations  have  made  no  consid- 
erable reductions  in  the  amounts  written  last  year  may  be 
attributed  to  their  large  writings  in  countries  outside  of 
Canada,  especially  in  the  United  tSates,  where  the  condi- 
tions in   1921   were  admittedly  better  than   in  Canada. 

The  smaller,  more  numerous,  Canadian  Companies 
generally  report  a  smaller  volume  of  new  business;     a  few 

Income  and  Disbursements  of  Life  Companies 


5 

N 

£ 

5 

Y  E.AR 

- 
2 

o 

M 

report  having  issued  about  the  same  amount  as  for  1920, 
with  smaller  incomes  and  heavier  lapses.  The  Crown 
Life  is  able  to  report  a  larger  volume  of  business  than 
for  1920,  with  a  large  increase  of  investment  earnings, 
and  death  claims  much  smaller  than  for  the  previous  year. 
In  a  .year  like  19  21,  such  a  favorable  report  from  a  Com- 
pany admittedly  not  one  of  the  largest,  reflects  credit 
upon  its  administrative  ability.  It  presupposes,  an  en- 
lightened, loyal  and  well-trained  field  organization,  a 
careful  selection  of  risks,  successful  handling  of  its  in- 
vestments, and  wise  husbanding  of  its  resources.  The 
great  difference  shown  in  the  amounts  of  new  business 
reported  by  the  larger  companies,  operating  in  foreign 
countries,  may  be  largely  accounted  for:  first,  by  the  ex- 
periment of  some  in  writing  Group  Insurance  without 
medical  examination;  and,  second,  by  the  large  policies 
tliey.are  able  to  write  of  Business  Insurance  and  for  cov- 
ering  policyholders'  liabilities   for  Succession   Duties. 

A   Decrease    on    the   MTiole 

At  the  fifteenth  annual  convention  of .  the  Association 
DT  Life  Insurance  Pfresidents,  held;  in  New  York  last 
month,  it  was  estimated  by  leading  speakers  that  the 
summing  up  of  business  for  last  year  showed  that  the 
total   volume   of   Insurance   written    in   the    United    States 


would  be  only  about  15%  below  that  of  1920.  At  the 
same  time  it  was  stated  that  1921  showed  an  increase 
of  about  2.6%  on  the  amount  written  in  1919,  which  at 
the  time  was  regarded  as  the  most  prosperous  year  for 
the  Life  Companies  ever  experienced.  The  amount  writ- 
ten by  American  Companies  for  1921  is  estimated  at  $8,' 
535,000,000  as  against  $10,105,000,000  for  1920.  These 
estimates  were  based  on  returns  furnished  by  148  of  the 
272  Life  Companies  doing  business  in  the  United  States. 
These  same  148  Companies  wrote  90%  of  the  new  busi- 
ness of  1920,  and  their  returns  for  1921  are  based  on 
the  actual  amount  of  new  business  paid  for  up  to  No- 
vember 1st,  plus  an   estimate  for  the  last  two  months. 

While  it  is  conceded  that  the  Canadian  Companies 
also  did  a  larger  business  in  1921  than  in  1919,  it  will 
not  be  gainsaid  that  on  the  whole  conditions  in  Canada 
were  not  as  favorable  as  in  the  United  Sates  last  year. 
The  trouble  arising  from  unemployment  was  proportion- 
ately greater  here,  and  the  tardiness  of  manufacturers 
and  wholesalers,  in  the  first  place,  and  of  .iobbers  and 
retailers  in  the  second  place,  in  readjusting  prices  of  all 
kinds  of  products,   was  probably  greater  in  Canada. 

The    Investment     Situation 

One  result  of  the  general  depression  in  trade  last 
year  was  the  releasing  of  a  large. supply  of  money  for  in- 
vestment, and  a  more  active  demand  for  high  grade 
bonds;  but  the  higher  price  of  these  naturally  tended  to 
a  return  to  mortgage  loans  on  the  part  of  some  invest- 
ors. A  year  ago  Victory  Bonds  were  sold  at  91.  and  to- 
day they  are  worth  from  98.  up  to  103.  At  the  close  of 
1914  real  estate  mortgages  formed  33%  of  the  assets  of 
Canadian  Life  Companies  and  bonds  and  debentures  ab- 
sorbed 30%;  at  the  end  of  1919,  mortgages  had  been 
reduced  to  22%,  and  bonds  and  debentures  had  in- 
creased to  54%.  Notwithstanding  that  the  total  assets 
of  the  Insurance  companies  increased  by  55%  during  the 
six  years  ending  with  19  20,  the  amount  invested  in  mort- 
gage loans  actually  decreased  and  $153,000,000,  or  87%; 
of  the  increased  assets,  had  been  invested  in  bonds  and 
debentures.  At  the  end  of  1920  the  amount  invested  in 
this   class   of   security   was    well-nigh    $120,000,000. 

Applications  for  loans  have  come  in  quite  freely  dur- 
ing the  last  six  months,  and  transactions  have  been  on  a 
larger  scale.  Declining  commodity  prices  and  smaller 
business  tend  to  lessen  the  demand  for  capital,  and  also 
the  rate  of  interest  for  the  same,  hence  good  securities, 
which  assure  to  the  holder  a  certain  fixed  return  every 
year,  must  appreciate  in  value.  With  the  progress  of 
time  and  a  steady  decline  in  prices  the  annual  interest 
payments  have  a  constantly  increasing  purchasing  power 
in  terms  of  goods.  Industry  and  thrift  are  undoubtedly 
pre-requisite  to  the  attainment  of  normal  conditions,  and 
.to  the  re-establishment  of  gold  as  an  effective  common 
denominator  between  currencies.  The  United  States  has 
probably  been  the  largest  gold  producing  country  in  the 
world,  but  the  gold  output  in  the  United  States  and  Can-' 
ada,  too,  has  declined  in  late  years,  to  almost  50%  of 
the  production  in  pre-war  days — owing  to  high  wages, 
decreased  efficiency  of  labor,  and  large  increase  in  cost 
of  supplies.  During  the  last  twelve  months  these  costs 
have  been  considerably  reduced,  hence  the  greater  ac- 
tivity in  the  gold  mines  and  a  steady  increase  in  the 
world's    production    of   gold. 

Insurance     Policy     Loans 

All  the  cornpanies  report  a  much  heavier  demand  for 
policy  loans  in  1921  than  for  any  single  year 
during  the  last  decade  —  due  of  course,  to  the  de- 
pression and  consequent  scarcity  of  money.  When 
in  need  of  cash  it  is  natural  for  policyholders  to  avail 
themselves  of  their  loan  privilege,  which  is  exceedingly 
valuable  if  properly  Used,  and  dangerous  when  abused. 
It  is  preferred  to  other  sources  for  borrpwing,  because 
the  policy  itself  is  the  only  collateral  needed,  the  money 
can  be  obtained  quickly-  without  publicity;  no  time 
limit  for  re-payment  is  stipulated;,  and  the  rate  of  in- 
terest  charged    is   generally   lower    than    the   current    rate, 


January  6,   1922. 


THE      MONETARY      TIMES 


161 


especially  on  old  policies.  Another  reason  for  turning  to 
the  Insurance  Companies  is,  that  to  assist  the  process  of 
deflation  banks  reduce  their  lines  of  credit  at  this  time 
and  increase  the  rate  of  interest  charged.  Others  wish- 
ing to  take  advantage  of  the  attractive  prices  at  which 
Dominion,  Provincial  and  Municipal  securities  are  offer- 
ing, Ijorrow  on  their  policies  with  the  Intention  of  re- 
paying the  loans  due  out  of  the  profits  or  future  savings. 
It  should  be  remembered,  however,  that  Life  Insur- 
ance policy  funds  are  reserves,  intended  for  the  protec- 
tion of  the  holders'  families,  in  case  they  themselves  are 
called  to  their  reward.  Hence  too  many  of  such  borrow- 
ers have  been  guilty  of  mortgaging  the  future  protection 
and  comfort  of  their  loved  ones,  often  for  mere  luxuries, 
without  evOT  being  able  to  repay  the  loans.  District 
Managers  and  their  agents  perform  a  real  service  to 
their  policy-holders  and  themselves  by  advertising  against 
such  loans,  and  keeping  them  down  to  the  minimum. 
The  large  companies  have  a  system  for  securing  the  re- 
payment of  such  loans,  in  instalments  or  otherwise,  to 
suit  the  borrowers,  and  report  that  the  favorable  results 
of  their  influence  Is  most  surprising.  "You  cannot  eat 
your  cake  and  have  it,"  neither  can  you  deplete  your 
Estate,  by  borrowing  and  still  have  protection  for  yOur 
family   or   self   in    the   days   when   you   still   want   It, 

The    Decrease    Tn    MoriAlity. 

According  to  up-to-date  mortality  records,  1921  was 
the  most  healthy  in  the  history  of  both  the  United  States 
and  Canada.  Vice-President  Robert  Lynn  Cox,  of  the 
Metropolitan  Life,  at  the  recent  meeting  ol  Life  Pres- 
idents in  New  York,  gave  facts  and  figures  in  support  of 
this  statement,  which  he  said  indicated  a  lowering  of  the 
Life  Insurance  death  rate  on  this  Continent  from  9.58 
per  thousand  in  1920  to  8.24  per  thousand  In  1921. 
These  figures  also  show  that  infiuenza  ha.s  almost  disap- 
peared from  the  United  States  and  Canada,  while  there 
has  been  a  decrease  in  pneumonia  and  other  dreaded 
diseases  amounting  to  about  507,  compared  with  1920. 
Mortality  due  to  automobile  accidents,  however,  is  show- 
ing an  increase  of  157,  and  upwards  in  1921.  Homicides 
and  suicides  also  show  large  increases.  These  are  direct 
results  of  the  war  re-action,  phases  of  economic  disturb- 
ance, and  as  times  improve  will  largely  cure  themselves. 
The  trend  of  mortality  in  Canada  during  the  last  decade, 
and  especially  during  the  last  five  years,  has  shown  a 
steady  decrease,  with  the  exception  of  the  years  1917 
and    1918.   when   the   "flu"  epidemic   was  raging. 

Group  Insurance 

During  the  last  couple  of  years  a  few  of  the  larger 
Canadian  Companies  have  embarked  upon  the  rather  ex- 
perimental branch  of  this  business  known  as  Group  In- 
surance for  amounts  not  in  excess  of  $1,000  each  without 
the  expense  of  medical  examination.  Although  not  a  new 
idea,  it  Is  yet  in  its  infancy,  especially  in  Canada,  and 
therefore  practically  an  experiment.  It  is  too  early  as  yet 
to  form  any  conclusive  opinion  or  convey  any  satisfactory 
information  as  to  the  ultimate  success  of  the  companies 
in  Canada  who  have  been  writing  this  class  of  business. 
The  snuiUer  companies  who  might  think  of  adopting  it 
would  bo  ill-advised,  wo  think,  and  experience  alone  should 
be  their  guide.  In  great  Britain,  several  companies  doing 
ordinary  Ijusiness  have  been  issuing  policie.s  up  to  £250, 
without  medical  examination,  with  good  results;  one  of 
these  has  been  issuing  policies  not  exceeding  £1000,  with 
the  proviso  that  if  death  occurs  during  the  first  three 
months  only  one-third  of  the  sum  assured  will  be  paid, 
and  if  it  occurs  within  the  next  three  months  only  two- 
thirds  will  be  paid,  and  thereafter  the  full  amount  of  the 
policy.  This  scheme  was  also  reported  as  showing  satis- 
factory results.  In  the  United  States  some  of  the  Urger 
Companies  report  satisfactory  experience  In  this  branch 
of  underwriting.  While  It  might  be  the  means  of  greatly 
extending  business,  especially  In  the  .sparcely  settled  parts 
of  the  Dominion.  It  Is  almost  certain  that  some  plans  of 
Insufance  would  not  be  granted  under  this  scheme,  and 
that  certain   classes   of  prospects   would   have   to   undergo 


examination.  Group  Insurance  In  Canada  la  on  its  trial, 
and  it  remains  to  be  seen  whether  the  benefits  of  Life 
Insurance  may  be  safely  and  widely  extended  by  this 
means  or  not. 

Higlier    Plane    Of     Kleld    Men. 

As  the  mission  of  I..ife  Insurance  comes  to  be  better 
understood  and  appreciated  by  the  general  public,  a  higher 
class  of  specially  trained  salesmen  is  being  placed  in  the 
field.  The  head  Office  executives  and  Agency  Managers 
more  than  ever  recognised  the  necessity  of  employing  only 
productive  agents,  who  will  endeavour  to  serve  both  the 
policyholders  and  their  companies;  between  the  amended 
legislation  and  improvements  by  Government  Insurance 
Departments,  and  the  instruction  and  training  of  special 
officers  for  the  purpose,  the  business  of  selling  Life  Insur- 
ance has  in  late  years  been  raised  to  a  much  higher  plane. 
The  "part-time  man."  the  "spotter,"  and  other  out-siders 
having  no  regular  company  affiliation  are  rapidly  becom- 
ing effaced.  The  most  progressive  companies  have  proven 
that  carefully  educated  and  trained  agency  organizations 
can  do  more  effective  work  in  the  field  than  a  lareer  orSaP' 
Uatlon  of  unaualifled,  untrained  men.  With  more  benf''  ' 
results  to  the  companies,  the  salesmen,  and  the  jn.- 
holders.  It  is  conceded  that  Incompetents  and  mis-fits 
work  untold  hnrm  to  the  cause  of  Life  Insurance,  and  it 
Is  believed  that  the  time  is  not  far  distant  when  most 
companies  will  refuse  to  engage  agents  who  have  not  taken 
a  prescribed  course  of  study  and  training  for  the  profes- 
sion. With  the  advent  of  Associations  of  Life  Presidents, 
Agency  Officers,  and  the  underwriters  themselves,  there 
is  now  a  general  demand  for  only  whole  time  professional 
salesmen;  and  the  days  when,  in  competition  for  basiness. 
some  companies  descended  to  issuing  blackmailing  litera- 
ture and  misleading  statements  to  damage  their  competi- 
tors, have  long  since  passed.  Cinadian  companies  are 
now  engaging  agency  instructors,  to  whom  is  entrusted 
the  training  of  prospective  salesmen;  others  encourage 
their  younger  representatives  to  attend  the  school  of  Life 
where  they  are  taught  both  the  theory  and  principles  of 
Life  Insurance.  They  also  receive  lectures  on  psychology 
and  are  given  practical  experience  in  its  direct  application. 
As  these  highly  organized  men  go  forth  to  their  dally 
work  they  bring  to  bear  more  enlightened,  favorable  pub- 
lic opinion  regarding  Life  Insurance,  which  Is  expressed 
in  various  directions.  As  is  generally  known,  the  bankers 
for  instance  recommend  it  to  their  clients,  to  whom  credit 
is  much  more  readily  given  if  they  are  carrying  an  ade- 
quate amount  of  Life  Insurance.  It  has  the  effect,  not 
only  of  guaranteeing  the  increased  security,  but  of  Inspir- 
ing confidence  In  the  borrower's  future  success.  A  man 
who  is  provident  enough  to  protect  his  dependents  is  much 
more  likely  to  meet  his  obligations  to  bis  banker  and 
other  creditors. 

Tlie   Outlook   For   IrtS^. 

This  picture  ha&  two  sides,  each  of  which  is  attractive 
enough  to  engage  abler  pens  for  at  least  half  .i  page,  but 
In  our  limited  space  we  may  but  touch  briefly  upon  each 
in  a  somewhat  suggestive  manner.  First  from  the  stand- 
point of  the  Companies,  who  we  have  stated  above,  have 
entered  upon  the  new  year  with  an  optimistic  view  of  the 
future.  How  could  it  be  otherwise?  Are  the  people  gen- 
erally not  daily-  thinking  more  about  and  providing  more 
intelligently  than  ever  for  their  future  well-being?  This 
Is  one  of  the  great  lessons  learned  from  the  world's  great- 
est war.  It  is  estimated  that  over  a  thousand  persons  in 
Canada  dally  invest  in  Life  Insurance  as  the  best  means 
known  to  the  world  of  caring  for  the  future  of  their  de- 
pendants. Over  six  hundred  and  forty  million  dollars  of 
life  insurance  was  Issued  in  Canada  during  1920  to  protect 
and  provide  for  In  their  homes  the  families  of  deceased 
husbands  and  fathers,  who  in  no  other  way  could  hare 
cared  for  them  afterwards  as  they  had  been  able  to  care 
for  them  In  their  own  life  times.  Thus  the  home,  the 
mightiest  Institution  on  earth,  which  stabilUe*  the  naTTon. 
Is  conserved  to  an  extent  limited  only  by  the  constantly 
increasing   population      of    the   country. — all    by   the    uai- 


152 


THE      MONETARY      TIMES 


Volume  68. 


versal  impulse  of  love,  duty  and  hope.  We  are  told  that 
the  growth  of  Life  Insurance  follows  the  trend  of  trade 
and  commodity  prices,  but  the  Life  Insurance  Salesman 
sells  a  commodity — if  such  it  may  be  called—  unlike  any 
other;  he  sells  faith  in  a  sure  hope,  and  gets  hard  money 
in  return.  And  notwithstanding  it's  ever-increasing  ad- 
aptability to  the  varied  needs  of  business  people,  even  to 
the  payment  of  the  dreaded  "Succession  duties,"  the  old, 
appeal  of  unquestioned  protection  for  the  family  and  home, 
which  has  stood  the  test  of  many  long  years,  and  won  the 
confidence  of  Governments  and  all  institutions  of  learning 
and  influence,  in  19  20  sold  more  Life  Isurance  than  ever 
In   the  world's  history. 

Having  thus  steadily  grown  in  permanence  and  stab- 
ility, and  become  as  irtuch  a  part  of  modern  life  as  the 
telegraph  or  telephone,  the  controlling  motive  of  the  Life 
Companies  must  ever  be  to  promote  the  great'  incentive 
of  thrift  among  the  people,  for  the  best  interests  of  the 
country.  What  then,  may  be  expected  in  the  immediate 
future?  Why,  basing  the  statement  upon  clearly  estab- 
lished facts,  the  recent  annual  convention  of  the  Associa- 
tion of  Life  Insurance  Presidents  declared  that  prosperity 
has   already   revived    and    requires     only    continuance    of 


courage  and  service  for  complete  restoration.  Different 
other  authorities  affirm  that  general  conditions  of  business 
are  on  the  upward  trend,  and  the  increased  confidence  of 
the  Canadian  Life  Officers'  Association  is  seen  in  their 
attitude  toward  "Institutional  Advertising"  as  an  aid  to 
the  wider  diffusion  of  Lite  Insurance,  by  voting  at  their 
last  meeting, — mofe  than  double  the  amount  subscribed 
for  this  purpose  last  year,  for  the  advancement  of  the 
work  this  year.  This  wide  spread  advertising  campaign, 
if  well  managed,  cannot  fail  in  its  good  purposes;  the  re- 
sults should  be  seen  in  a  measurable  increase  in  the  pro- 
duction; in  the  elevation  of  Solicitors  in  public  esteem  to 
an  extent  that  will  attract  to  the  profession  still  more 
high-class,  thoroughly-educated  men  who  would  not  other- 
wise be  induced  to  engage  in  it;  in  the  steady  reduction  of 
lapses  or  terminations,  and  so  Increase  and  conserve  the 
■amounts  of  Insurance  In  force;  in  the  decrease  per  unit 
in  overhead  expenses;  in  the  influence  of  public  opinion 
upon  legislatures  to  at  least  retard  a  further  increase  in 
the  already  heavy  taxation  of  life  insurance  premiums, 
and  thus  keep  down  if  not  reduce  the  cost  of  insurance. 
These  suggested  results,  if  calculated  in  actual  figures, 
would  show  total  increases  in  business  and  savings  in  the 
aggregate  that   would  foot   up  hundreds   of   millions. 


Insurance  Licenses  Issued  in  Canada  Last  Year 

Fifty-Two  Companies  Authorized  to  Transact  New  Business 
Here — Majority  of  Licenses  Issued  Were  Just  Extensions  of 
Previous  Scope — Fire  a  Prominent  Line — No  Life  Insurance  Licenses 


FROM  the  beginning  of  December,  1920,  to  the  end  ot 
Noverhber,  1921,  fifty-two  licenses  were  issued  by 
the  Department  of  Insurance,  Ottawa,  for  the  writing  of 
Insurance  in  Canada.  While  this  is  a  large  number,  it 
does  not  quite  match  up  to  the  record  of  the  previous  year, 
when  fifty-two  licenses  were  issued  in  nine  months.  A 
goodly  number  of  licenses  were  also  issued  by  the  Prov- 
incial Governments  last  year,  although  here  again,  they 
did  not  equal  or  exceed  the  previous  figure.  The  Provin- 
cial registrations,  of  course,  are  merely  further  reglsta- 
tions  of  the  companies  licensed  to  do  business  in  the 
Dominion.  A  company  wishing  to  do  business  in  this 
country  must  first  of  all  get  its  license  from  Ottawa,  and 
then  get  a  Provincial  registration  as  it  wishes  to  do  busi- 
ness  in    the   various   parts   of   the   country. 

Looking  chiefly  at  the  record  of  Dominion  licensese, 
for  that  is  the  best  reflection  ot  whatever  developments 
have  taken  place,  shows  that  in  the  majority  of  cases  the 
licenses  given  were  jilst  extensions  of  previous  authority. 
Of  the  fifty-two  companies  which  obtained  licenses,  thir- 
teen were  absolutely  new,  as  far  as  writing  business  here 
was  concerned.  These  companies  are  indicated  in  the  list 
-by  the  name  of  their  agent.  In  the  cases  where  the  licenses 
were  just  extensions  of  authority,  the  agents-  names  are 
not  given. 

Another  fact  worthy  of  notice  is  that  most  of  the  new 
companies  which  started  business  here  are  British,  and 
well-established  organizations  at  that.  There  were  two 
or  three  American  concerns  and  one  French  company. 
These  facts,  together  with  the  large  number  of  companies 
which  enlarged  their  scope.  Indicate  with  what  favor 
Canada  is  still  regarded  as  an  underwriting  field.  Last 
year's  record  is  all  the  more  significant  in  view  of  the 
state  of  general  business  and  financial  conditions  which 
existed. 

Considering  the  list  fro  mthe  standpoint  of  classes  of 
business,  shows  that  fire  stands  out  prominently.  With 
the  exception  of  three,  the  new  companies  were  all  licensed 
for  the  express  purpose  of  transacting  fire  business  in  the 
Dominion. The  two  other  prominent  lines,  according  to 
the  list,  were  automobile  tand  hail.  Two  other  classes  of 
business    also    came    into    prominence,    nameiy,    insurance 


against  loss  or  damage  by  robbery,  and  gas  explosion 
insurance.  It  is  a  notable  fact  that  In  the  last  two  eases 
as  soon  as  one  company  would  secure  a  license  for  trans- 
acting that  kind  of  business,  many  others  would  shortly 
follow. 

No  licenses  were  issued  for  life  business,  with  the 
exception  of  two  fraternal  companies.  The  following  is 
the  list  of  the  companies  which  secured  licenses,  together 
with  the  details  ot  the  business  which  they  were  author- 
ized to  transact  : 

CANADA 
December,  1920 — 
Reliance    Insurance     Company     of     Canada- — Fire — J.    W. 

Tatley,   Montreal. 
Yangtsze    Insurance   Association   Ltd. — Fire. 
National    Union    Fire   Insurance    Co.,    of    Pittsburg — Auto- 
mobile. 
Halifax   Fire    Insurance   Company — Fire. 
Merchants   Marine   Insurance   Co.,    of   London,   Eng. — Fire 

and    Automobile — C.W.I.    Woodland,    Montreal. 
United   States   Fidelity  and   Guaranty   Company — Forgery. 

January,    1921 — 
Scottish   Canadian    Assurance   Company — Fire    and    Hail — 
T.   H.    Hall,   Toronto. 

February,    1921 — 

Caxton  Insurance  Co.,  of  London,  England — FJ-e — A.  H.  C. 

Carson,    Toronto. 
Merchants   Casualty  Co.,  of    Winnipeg — Automobile — R.   C. 

Sanborn,  Montreal. 
Insurance     Co.    of    North     America — Hail      and     Sprinkler 

Leakage. 
Aetna    Insurance    Company — Hail. 

March,   1921 — 
Western  Assurance  Company — Hall. 
Mount    Royal   Assurance   Company — Automobile. 
Niagara   Fire  Insurance   Company — Hail. 
Occidental  Fire  Insurance   Company— Hail. 

April,   1921 — 
National    Union    Fire   Insurance  Company    of    Pittsburg — 

Hail. 
Sterling    Fire    Insurance    Company    of   Indiana — Hall    and 

Automobile. 


January  6,   1922. 


THE      MONBTART      TIMES 


153 


.Supreme    Lodge    Knights    of    Pythias — Fraternal    Life. 
Western    Mutual    Lite    Association — Fraternal    Life. 
Springfield    Fire    and    Marine    Insurance    Company — Hail. 
Canadian     Surety     Company — Insurance     against    loss    or 

damage  by  Uobbery. 
Fidelity  and  Casualty  Co.  of  New  York — Insurange  against 

loss  or  damage  by  Robbery. 
Travelers   Indemnity   Company — Insurance  against   loss   or 

damage   by   Robbery. 
Dominion  of  Canada  Guarantee  &  Accident  Co. — Insurance 

against  loss  or  damage  by  Robbery. 
Maryland    Casualty    Company — Insurance    against    loss    or 

damage   by   Robbery. 
Employers'    Liability     Assurance     Corp.      Ltd. — Insurance 

against  loss  or  damage  by  Robbery. 

May,    l»2l — 

Pacific    Fir.e    Insurance    Company — Fire — Shuw    &     Begg, 

Toronto,    chief    agents. 
Law    Union    and    Rock    Insurance    Co.     Ltd. — .\utomobi)e. 
Aetna    Casualty    and    Surety    Co. — Guamntee    Insurance — 

E.    J.   Christmas,   Montreal,   chief  agent. 
\gricultural    Insurance    Co. — Fire — P.    S.    Grant,    Toronto, 

chief   agent. 

.fiinc,   llt21 — 

Home    Insurance    Company — Insurance    against    loss    of    or 

d  image   of  growing  crops. 
Hartford    Insurance    Company — Insurance    against    loss    by 

rain   or  flood. 
Alliance  .Assurance  Company.  Ltd. — -Insurance  against  loss 

or  damage  by   Robbery. 

AuKiL-^t,  inai — 

Urbaine    Fire    Insurance    Co.,    of    Paris — Fire — Strathcona 

Fire,    Montreal. 
Liverpool-Manitoba    Assurance    Co. — Automobile. 
Austral.  Ins.  Co.,  Ltd. — Accident  and  Sickness — J. P.  Moore, 

Montreal. 
Patriotic  Assurance  Co.,  Ltd. — Fire — Sun  Insurance  Office, 

Toronto. 
Autocar  Fire  and  Accident  Ins.  Co.,  Ltd.,  of  London — Fire 

— Jas.   D.  Cherry,  Montreal. 
British  Oak  Insurance  Co.,  Ltd. — Fire — Ralnee  &  Keaton, 
Halifax. 
September,  1931 — 
Canadian    Fire    Ins.    Co. — Guaranty,    Burglary,    Explosion, 

Hall,    Livestock    and   Tornado. 
Maryland   Casualty   Co. — Forgery. 
Sun    Insurance    Office — Accident,    Automobile,    Guiarantee 

and    Sickness. 
Home    Insurance    Co. — Rain,     Tempest,     Flood    and    Hall, 

Windstorm,   Cyclone  or  Tornado. 
Ocean  Marine  Ins.   Co. — Inland   Transportation. 
Imperial   Underwriters'   Corp.    of  Canada — Accident,    Auto- 
mobile,   Guarantee   and    Sickness. 
November,  1921— 
Union  Insurance  Society  of  Canton,  Ltd. — Sickness. 
Alliance   Assurance    Co.,    Ltd. — Gas    Explosion. 
Agricultural    Insurance    Co. — Gas    Explosion. 
Merchants  Fire  Assurance  Corp.   of  N.   Y. — Gas  Explosion. 
Motor   Union   Insurance   Co..    Ltd. — Gas   Explosion. 
St.  Paul  Fire  &  Marine  Insurance  C6mpany — Gas  Explosion. 
L'Union    Compagnie   d'   Assurance — Gas   Explosion. 

MANITOBA 

December,    1920 — 

Northwestern  Mutual  Fire  Association  of  Seattle,  Wash. — 

Fire. 
Retail    Merchants    Underwriters'    Agency — Plre    and    Auto- 
mobile. 
.January,  1931 — 
Merchants'   Marine  Insurance  Co.   Ltd.,  of  London,   Eng. — 
Fire    and    Automobile — John    Calverly,    Western 
Fire   Manager. 
February,    1931 — 
Scottish    Canadian    Assurance    Company — Plre    and    HaD. 

March,    1921 — 
Motor    Union    Insurance    Company,    litd. — Fire,    Accident 
and  Automobile. 


La  Sauvegarde  Life  Insurance  Company — Life. 
United  Assurance  Co.  of  Calgary — Fire  and  Hall. 

April,    1921 — 
Preferred    Accident    Insurance    Company,    of    New    York — 

Accident,  Sickness  and  Automobile — O.K.  Watson. 

chief  agent. 
Commercial   Mutual    Fire  Insurance   Co. — ^Mutual    Fire. 
Lumbermen's    Mutual.   Casualty    Co. — Automobile — J.    M. 

Moorhouse,   Winnipeg,   chief  agent. 
October,  1921 — 
Montreal  Plate  Glass  Ins.  Co.,  Montreal,  Que. — Plate  Glass. 

BRITISH  COLUMBIA 
December,    1920 — 

New    Jersey    Insurance   Company — Marine. 

Union  Fire  and  Casualty  Company — Health  and  Accident — 

Gordon      Bell,     1.333     Standard    Bank    Building, 

Vancouver. 
National    Fire    Insurance   Company   of   Hartford — Tornado, 

Explosion,    Inland    Transportation,     Marine     and 

Automobile — H.    T.    Barnes,    Victoria. 
.March,    1921  — 
Merchants    Casualty    Company — Automobile — J.    B.    Love. 

Vancouver. 
London    .iVssurance    Company — Inland    Marine    and    Inland 

Transportation.  ' 

April,    1931 — 
Reliance  Insurance  Company  of  Canada — Fire. 
Union  Assurance  Society,  Ltd. — Automobile — 0.  R.  BIsnop, 

Montreal,  chief  agent. 
May,   1921 — 
Merchants   Marine  Insurance  Co.   Ltd. — Fire  and   Automo- 
bile— J.    A.    Young,    Vancouver. 
American   Equitable  Assurance  Co.   of  N.   Y. — Fire — C.  G. 

Hobson,   Vancouver. 
Law    Union    and    Rock    Insurance    Co.    Ltd. — Automobile, 

Burglary  and  Plate  Glass. 
June,   1921 — 
London  and  Lancashire  Co.  Ltd. — Marine,   Automobile  and 

Explosion. 
September,   1921 — 
General  .'\nimals  Ins.   Co.  of  Canada — Plate  Glass. 

Octobor,    1921 — 
Autocar  Fire  &  Accident  Ins.  Co.  Ltd. — Fire. 

November,   1921 — 
National  Provincial  Plate  Glass  and  General  Insurance  Co.. 

Ltd. — Fire. 
Maryland    Casualty    Co. — Forgery,    Fly    Wheel,    Sprinkler 

Leakage    and    Robbery. 

QUEBEC 
December,   1920 — 

Northwestern     Mutual     Insurance     Association — Fire     and 
Automobile— M.    Lapointe,    Montreal. 
February,    1921 — 
Merchants  Casualty   Co. — Automobile. 

Merchants    Marine    Insurance    Co.    Ltd. — Plre    and    Aatc- 
mobile — John    Jenkyns,    17   Jt.    John  St.,  Montrel. 
April.   1921 — 
British    Traders    Insurance    Co.    Ltd. — Inland    Marine   and 
Ocean   Marine — J.   Rowat.    17   St.  John  St..  Mont- 
real, chief  agent. 
Casualty    Co.    of    Canada — .\utomobile    and    Plate    Glass — 
T.    Duffy,    11    St.    Sacrament  St.,   Montreal,   chief 
agent. 
National    Provincial    Plate    Glass    and    General     Insurance 
Company — Fire  and  Plate  Glass — A.  Barrv  Rovai 
Exchange  Bldg.,  Montreal,  chief  agent. 
May,   1921 — 
Canada   Nation.il    Fire  Insurance   Co. — Plre — H.M.    Brown, 
9   St.  John  St.,  Montreal,  chelf  agent. 
.Tune.    1931 — 
Ocean     Marine     Insurance     Company — Inland    and    Ocean 
Marine — H.   Hampson,   1   St.   John  St..   Montreal. 
July.   1921 — 
Hardware    Dealers'    Mutual     Pire    Insurance   Company    ot 
Wisconsin — Fire. 


154 


THE      MONETARY      TIMES 


Volume  68. 


Retail  Hardware  Mutual  Fire  Insurance  Company — Fire — 
A.  Brunelle,  97   St.  James  St.,  Montreal. 
August,   1921 — 
National  Liberty  Ins.  Co.  of  America — Fire — H.A.   Stewart, 
Montreal. 
September,   1021 — 
Autocar  Fire  &  Accident  Ins.   Co.   Ltd. — Fire. 

October,  1921 — 
American    Assurance    Compvany — Fire    Insurance. 

AlBERTA 
March,   1921 — 

La   Sauvegarde  Life  Insurance   Company — Life. 
Merchants'   Casualty   Co.,  Winnipeg — Automobile. 

June,    1921 — 
Glasgow    ITnderwriters — Fire. 
Occidental    Fire    Insurance    Co. — Hail. 

September,    1921 — 
Hartford   Fire   Ins.   Co.^Weather. 
Alliance   Assurance    Co.    of    London,    Eng. — Robbery. 

SASKATCHEWAN 

June,   1931 — 

Grain    Insurance    Co.    of    Winnipeg — Fire    and    Guarantee. 
National    Benefit    Assurance   Co.    Ltd.,    of    London,    Eng. — 

Fire,    Accident   and    Sickness. 
Saskatchewan   Urban   Mutual   Fire  Insurance  Co. — Fire. 
Commercial    Life    Assurance    Co.    Ltd.,    Edmonton — Life. 

September,   1921 — 
Ontario  Equitable  Life  and  Accident  Ins.   Co. — Life. 

October,   1921 — 
National   Liberty  Insurance  Co.,  of  America — Fire. 

ONTARIO 
January,    1921 — 

Merchants'  Marine  Insurance  Company,  Limited. 
Scottish   Canadian   Assurance   Corporation. 

Mareh,  1921 — 
Reliance  Insurance  Company  of  Canada. 

May,    121 — 
Agricultural   Insurance   Company. 
Caxton    Insurance    Company,    Limited. 
Pacific   Fire  Insurance   Company. 

June,   1921 — 
Tokio  (Marine  and  Fire  Insurance  Company,   Limited. 

July,  1931 — 
Toronto    Casualty    and    Marine    Insurance    Company. 

AuKu.st,   1931 — 
Urbaine  Fire  Insurance  Company. 
Western    Mutual    Life    Association. 

October,   1921 — 
Austral.    Insurance   Company,    Limited. 
Autocar  Fire  and   Accident  Insurance   Company. 
British    Oak   Insurance    Company. 
Patriotic    Assurance    Company,    Limited. 

NOVA   SCOTIA 
January,    1921 — 

The  Ontario  Euitable  Life  &  Accident  Insurance  Company. 
Merchants'    Marine    Insurance    Company,    Limited. 

March,   1921 — 
The   Tokio   Marine    &    Fire    Insurance   Company,    Limited. 
New  Jersey  Insurance  Company. 
Peninsular    Fire    Insurance    Company    of   America. 

July,   1921 — 
Alliance   Insurance   Company  of   Philadelphia. 

October,    1921^ 
The   British   Oak  Insurance  Company,   Limited. 

November,  1921-— 
Patriotic   Assurance    Company,    Limited. 


FORGERY    INSURANCE    MORE   IN    DEMAND 

Another   Instance   of    How   ("rime    Wave    Has   Bi'ouKht  Ex- 
pansion  of   IJusiness   for  Insurance   Companies 

IJy  RANDOLPH  S.  MORTLEY 

WHILE  this  form  of  insurance  protection  is  quite  new 
in  this  country — if  not  indeed  somewhat  new  in 
America — there  are  not  wanting  plenty  of  evidence,  in 
financial  and  commercial  circles,  that  it  has  been  found  by 
the  leading  banks  and  business  houses  to  be  very  necessary. 
Notwithstanding  the  assiduity  and  cleverness  displayed 
by  innumerab'.e  executive  officers  of  all  kinds  of  firms, 
corporations  and  financial  institutions,  to  acquire  personal 
signatures  that  cannot  be  read  or  even  guessed,  much  less 
faultlessly  imitated  by  forgers  and  cheque-raisers,  as  well 
as  cheque-makers,  they  have  to  acknowledge  that  these 
skilful  professionals  in  "high  finance,"  who  have  made  the 
closest  study  of  cheques  manipulation,  and  have  every  detail 
down  to  science,  can  and  do  outclass  them  in  this  greatest 
(shall  we  say?)  of  modern  arts.  And,  as  this  class  of 
crime  is  steadily  increasing  every  year,  and  the  authorities 
so  often  experience  the  greatest  di...  culty  in  proving  the 
identity  of  such  criminals,  many  charges  having  to  be 
dropped  on  this  account,  up-to-date,  prudent  business  men 
everywhere  are  becoming  convinced  that  the  Forgery  Bond 
is  the  only  logical  and  the  surest  method  by  which  bankers 
and  their  customers  may  be  adequately  protected  from 
heavy  losses  every  now  and  then.  Convicts  tell  prison 
officials  that  once  they  get  the  signature  or  alteration 
executed  properly,  "it  is  the  easiest  thing  in  the  world"  to 
get  the  money. 

The  National  Surety  Co.,  of  New  York,  U.S.,  is  the  only 
company  operating  to  any  extent  in  this  class  of  insurance 
in  Canada  so  far  as  can  be  learned.  After  the  war,  in  191S. 
this  company  introduced  their  Forgery  Bond  in  the  United 
States,  but  did  not  attempt  to  actively  solicit  these  bonds 
in  Canada  until  about  May  1st,  1921.  Judging  from  the 
reception  they  have  receive'd  here,  evidenced  by  letters 
received  from  bond-holders  acknowledging  prompt,  full 
payment  of  claims,  and  from  solicitors,  bankers  and  others, 
heartily  endorsing  this  form  of  protection,  the  field  is  pro- 
ductive, and  promises  to  be  profitable.  Definite  figures 
were  not  yet  available,  as  the  Toronto  branch  office  had 
not  received  them  from  Head  Office  when  our  representa- 
tive car.ed,  but  the  records  of  the  local  agency  show  that 
they  have  paid  considerably  over  .$2,000  in  losses  during 
less  than  eight  months  that  they  have  been  in  business 
here.  These  forgery  bonds  are  issued  for  one  and  three 
years,  for  amounts  of  from  $5,000  to  $200,000,  the  premium 
rates  varying  from  $25  for  a  $5,000  bond  for  one  year,  with 
increases  of  $25  for  each  additional  $5,000  up  to  a  $25,000 
bond;  for  $.50,000  the  premium  is  $250,  and  is  doubled  for 
each  additional  $50,000  up  to  $200,000.  For  three-year  bonds 
the  premiums,  with  discounts  deducted,  are  proportionately 
smaller  for  the  same  amounts  of  insurance  as  with  one- 
year  bonds.  A  further  discount  of  15%  is  allowed  on  total 
premiums  for  the  three-year  term,  when  paid  in  advance. 
A  blanket  bond  covering  branches,  subsidiary  companies 
and  officers,  as  extension  coverage,  may  be  secured  at  an 
additional  rate  of  $1  per  thousand. 


BRITISH  TRADE  COMMISSIONERS. 

Early  in  November  G.  T.  Milne  succeeded  Evan  J. 
Edwards  as  senior  British  Trade  Commissioner  in  Canada. 
Mr.  Milne  had  occupied  this  position  previously.  Mr.  Edwards 
resided  because  he  thought  the  allowances  for  maintaining 
the  office  insufficient. 


CLOSE  OF   ST.  LAWRENCE  NAVIGATION 

With  the  sailing  of  the  tank  steamer  Crewe  for  New 
York  on  December  8,  the  port  of  Montreal  was^  clear  of 
ocean-going  vessels  excepting  those  which  are  to  lie  up  for 
the  winter.  The  River  St.  Lawrence  was  reported  to  be 
running  free  of  ice  at  all  point.  Final  departure  of  vessels 
takes  place  this  year  two  days  later  than  in  1920.  Several 
small  river  and  lake  boats  were  still  moving,  and  two  of 
these  were  scheduled  to  discharge  cargoes  at  once,  and  then 
proceed  to  the  Canadian  Vickers  Co.'s  yards  for  over- 
hauling. 


January   6,   1922. 


THE      MONETARY      TIMES 


155 


Fire  Loss  Second  Highest  on  Record 

Monetary  Times'  Estimate  for  1921  Exceeded  Only 
By  Figure  for  1918,  Which  Was  Abnormal  Year — Large 
Number    of    Heavy    Losses — Fewer    Deaths    From    Fire 


FIRE  losses  111  Can-ida  during  the  past  year  are  estimated 
by  The  Monetary  Times  at  $29,987,510,  againsr$27,371,- 
574  in  1920.  This  is  the  highest  loss  on  record  with  the 
exception  of  1918,  when  the  total  of  $31,815,844  was  reached. 
It  is  a  per  capita  loss  of  $3.33.  There  were  an  exceptionally 
large  number  of' large  fires  during  the  year,  though  none  of 
them  amounted  to  a  conflagration. 

The  results  may  be  summarized  as  follows: 

1918  1919  1920  1921 

Average  monthly 

loss    

Loss  per  capita. . 
Fires    with    dam- 
age of   $10,000 

or  over   256  288 

The   Monetary  Times'   record   for 
shows  the  following  monthly  losses : 
Month  1918  1919 

January    $  2,688,556  $  3,915,290  $  2,637,850  $  2,237,900 

February    .  . .     2,243,762       1,091,834       1,895,575       2,735,500 


$2,651,320  $1,933,970  $2,280,964  $2,498,959 


4.11 


$2.90 


$3.42 


$3.33 


the 


301  377 

past  four  years 


1920 


1921 


March    1,682,286 

April   3,240,187 

May  3,570,014 

June     3,080,982 

July   3,369,684 

August    3,110,445 

September    .  .  917,286 

October   5,119,145 

November   .  . .  1,059,.580 

December    .  .  .  1,733,917 


2,154,095 
1,080,070 
1,785,130 
3,337,530 
1,118,377 
1,374,495 
1,940,272 
1,023,288 
2,339,870 
2,047,496 


1,793,200 
3,229,500 
2,001,819 
1,424,319 
1,426,850 
1,857,800 
2,480,485 
2,467,901 
2,769,800 
3,386,475 


2,112,200 
2,510,700 
3,811,350 
2,303,400 
2,880,250 
3,014,860 
2,410,300 
2,199,700 
1,818,750 
1,952,600 


Totals    ..$31,815,844  $23,207,647  $27,371,574  $29,987,510 

The  following  table  gives  a  list  of  fires  of  $10,000  and 
over,  month  by  month,  compared  with  five  previous  years : 


Month  1916 

January    ......  28 

February    30 

March    30 

April    13 

May   23 

June 9 

July   13 

August    14 

September    ....  12 

October   14 

November   14 

December   18 


Tota 


218 


1917 
28 
31 
26 
13 
11 
17 
16 
14 
10 
15 
26 
31 

238 


1918 
43 
21 
16 
24 
27 
19 
24 
23 
14 
12 
14 
19 

256 


1919 
25 
18 
28 
26 
20 
31 
22 
16 
17 
19 
25 
41 

288 


1920 
31 
33 
23 
32 
19 
8 
16 
21 
30 
27 
29 
32 

301 


1921 
31 
38 
20 
24 
33 
39 
32 
33 
30 
34 
35 
28 

377 


LIST  OF  LARGE   FIRES 
Fires  causing  damage  of  $100,000  and  over  were  as  fol- 
lows: 

Jan.     14 — $200,000,  Business  block,  Sydney,  N.S. 
Jan.     19— $150,000,  Store,  Halifax,  N.S. 
Jan.     28 — $200,000,  Forum  Building,  Toronto,  Ont. 
Jan.     28— $100,000,  Stovel  Building,  Winnipeg,  Man. 
Feb.      3— $100,000,  Billiard  parlors,  Halifax,  N.S. 
Feb.      3— $300,000,  Business  block,  Winnipeg,  Man. 
Feb.      6— $150,000,  Building,  Toronto,  Ont. 
Feb.    18 — $100,000,  Building,  Montreal,  Que. 
Feb.    19— $200,000,  Block,  Sa.skatoon,  Sask. 
Feb.    21— $300,000,  Car  sheds,  Levis,  Que. 
Mar.  18 — $100,000,  Store,  Grande  Prairie,  Alta. 
Mar.  20— $750,000,  Plant,  Brittania  Beach,  B.C. 
Mar.  26 — $100,000,  Bake  shops,  Ottawa,  Ont. 
Apr.    10— $100,000,  Building,  Quebec,  Que. 
Apr.    19— $800,000,  Church,  Montreal,  Que. 


20— $200,000,  Roundhouse,  St.  Stephens,  N.B. 
29— $250,000,  Building,  Regina,  Sa.sk. 
3— $100,000,  Plant,  Goderich,  Ont. 
.5 — $100,000,  Business  .section,  St.  Boniface,  Que. 
8 — $300,000,  Business  section,  Maxville,  Ont. 
10— $100,000,  Lumber  yard,  Laforest,  Ont. 
14— $500,000,  Woollen  mills,  King.sville,  Ont. 
15— $100,000,  Hotel,  Quebec,  Que. 
18— $100,000,  Garage  and  hotel,  Benito,  Man. 
18— $500,000,  Old  Fort  Ground.s,  Toronto,  Ont. 
20 — $175,000,  Business  .section,  Sayaback,  Que. 
21— $200,000,  Business  section,  Bic,  Que. 
22— $130,000,  Factory,  Ottawa,  Ont. 
26— $150,000,  Sawmill,  St.  Jo.seph  de  Beauce,  Que. 
29— $100,000,  Building,  Montreal,  Que. 
3— $100,000,  Elevator,  Port  Hope,  Ont. 
6 — $100,000,  Sub-station,  Niagara  Falls,  Ont. 
9— $100,000,  Shed,  Quebec,  Que. 
9— $150,000,  Ten  residences,  Quebec,  Que. 
11— $100,000,  Building,  Joliette,  Que. 
June  17 — $100,000,  Store,  Sombra,  Ont. 
June  26 — $200,000,  Business  section,  Spirit  River,  Alta. 
July      6— $400,000,  Buildings,  Guelph,  Ont. 
July    11— $100,000,  Building,  Toronto,  Ont. 

11— $100,000,  Business  section,  Williams  Lake,  B.C. 
18— $100,000,  Ice-house,  Hamilton,  Ont. 
18— $150,000,  Sixteen  buildings,  Sydney  Mine.s,  N.S. 
28— $300,000,  Lumberyard,  Nelson,  B.C. 
31— $150,000,  Plants,  Kelowna,  B.C. 
31— $120,000,  Garage,  Montreal,  Que. 
2— $15(»,000,  Buildings,  Richibucto,  N.B. 
4 — $175,000,  Warehouse,  Gain.sborough,  Sask. 
6 — $100,000,  Property  of  Dom.  Chemical,  Sydney,  N.S. 
6 — $200,000,  Mill,  Vancouver,  B.C. 
8— $130,000,  Factory,  Frankford,  Ont. 
Aug.  10— $750,000,  Buildings,  Aylmer,  Que. 
Aug.  28— $100,000,  Cafe,  Edmonton,  Alta. 

3— $100,000,  Buildings,  St.  Camille,  Que. 
21— $500,000,  Boathou.ses,  Parry  Sound,  Ont. 
21— $100,000,  Sawmill,  St.  Cccile,  Que. 
25 — $250,000,  Business  section,  Hatton,  Sask. 
3— $125,000,  Plant,  Vancouver,  B.C. 
9— $100,000,  Residences,  St.  Severin,  Que. 
14 — $100,000,  Warehouse,  Yorkton,  Sask. 
20— $125,000,  Theatre.  Ottawa,  Ont. 
23— $250,000,  Wardrobe,  Montreal,  Que. 
30— $150,000,  Lumber,  Clarksville,  N.S. 
14_$100,000,  Building,  Ottawa,  Ont. 
19— $125,000,  Store,  Calgary,  Alta. 
2— $100,000,  Six  residences,  Montreal,  Que. 
18— $200,000,  Church,  Buctouche,  N.B. 
19— $200,000,    Factory,  London,  Ont. 
FATALITIES 
Deaths  due  to  fires  in  1921  were  as  follows: 
Month  1914  1915  1916  1917  1918  1919  1920  1921 


Apr. 
Apr. 
May 
May 
May 
May 
May 
May 
May 
May 
May 
May 
May 
May 
May 
June 
June 
June 
June 
June 


July 
July 
July 
July 
July 
July 
Aug. 
Aug. 
Aug. 
Aug. 
Aug. 


Sept 

Sept. 

Sept. 

Sept. 

Oct. 

Oct. 

Oct. 

Oct. 

Oct. 

Oct. 

Nov. 

Nov. 

Dec. 

Dec. 

Dec. 


January  26  3  10  21  28  13  22 

February  18  11  23  19  87  26  30 

March  27  23  23  20  34  9  36 

April  22  14  6  15  7  -27  8 

May  8  5  14  12  10  15  IS 

June 12  2  6  9  9  28  15 

July  8  13  268  19  6  11  15 

August 3  14  30  12  7  24  14 

September  9  27  6  21  13  23  13 

October  9  7  39  23  11  16  13 

November 14  12  12  21  3  14  31 

December  19  11  94  16  26  19  15 


17 
18 

U 

t 

13 
10 

10 
11 
4 
20 
23 
11 


Totals  ....  175  142  631  207  241  226  224  165 


156 


THE      MONETARY      TIMES 


Volume  68. 


LIFE  BUSINESS  WRITTEN  BY  REPRESENTATIVE  GO'S 


Company  A — 


1920 


January $7,770,287 

February 3,815,945 

March 5,556,154 

April 5,267,212 

May 4,250,828 

June 5,119,877 

July 5,143,179 

August 4,468,625 

September 4,658,567 

October 4,169,063 

November 5,171,145 

December 


Total $55,400,892 

Company  B — 

1920 

January $6,170,325 

February 4,120,542 

March 5,042,779 

April 4,507,664 

May 4,374,803 

June 5,277,454 

July 4,441,218 

August 4,181,903 

September 3,289,972 

October 3,600,494 

November 3,902,791 

December 


Total $48,909,945 

Company  C — 


January  . . 
February  . 

TMirch  .  . . 
April  . .  . . 
May 

-June  ...   . 

^Snily 

August  . . . 
September 
October  . . , 
November  , 
December  . 


1920 
103,000 

46,500 

75,000 
100,000 

97,200 
165,000 
157,555 

68,200 


Total $    812,455 

Company 


1920 

January $2,247,177 

February 2,319,641 

March 3,427,347 

April 2,895,066 

May 2,711,972 

June 2,972,022 

July 2,340,472 

August 2,422,717 

September 2,449,781 

October 2,479,328 

November 2,980,185 

December 


Total $29,245,708 

Company  E — 

1920 
January $    973,150 


February 
March 
April  . 
May  . . 
June  . . 


745,000 
850,680 
1,013,076 
710,500 
845,100 


1921 
$8,837,135 
4,928,029 
4,958,659 
7,035,320 
4,662,390 
6,661,548 
4,896,811 
4,277,534 
5,064,905 
4,464,657 
5,238,472 


$61,025,460 


1921 
$4,978,418 
3,736,025 
3,612,622 
4,205,718 
4,240,692 
4,735,314 
4,090,223 
3,269,315 
3,382,399 
2,919,329 
2,947,115 


$42,117,170 

1921 
$  372,000 
415,500 
543,000 
468,700 
362,000 
581,100 
657,000 
514,400 
535,450 


$4,449,150 

1921 
$2,369,558 
2,250,268 
3,088,436 
2,321,896 
2,744,745 
3,147,915 
2,397,595 
2,512,974 
2,297,575 
2,913,777 
2,446,845 


$28,491,584 

1921 

$  770,500 
993,526 
986,100 
935,860 
957,090 
1,014,500 


July 978,232 

August 958,500 

September 903,867 

October 985,632 

November 1,007,054 

December 


Total $9,970,791 

Company  F — 


January  .  . . 
February  .  . 
March  .    ... 

April 

May 

June 

July 

August  .... 
September  . 
October  .  .  .  . 
November  . . 
December  . . 


1920 

648,350 

514,825 

758,705 

792,805 

611,876 

656,287 

714,320 

706,910 

597,135 

670,485 

344,715 


Total $7,016,413 

Company  G — 

1920 

January $5,990,275 

February 3,733,975 

March 4,982,486 

April 5,009,323 

May 4,962,975 

June 6,205,648 

July 5,716,748 

August 4,474,287 

September 4,578,822 

October 5,453,064 

November 5,815,968 

December 


Total $56,913,571 

Company  H — 

1920 

January $1,779,629 

February 2,023,925 

March 2,343,162 

April 2,004,525 

May 2,278,015 

June 2,648,757 

July 2,367,301 

August 1,793,557 

September 1,886,000 

October 2,162,454 

November 1,904,943 

December 


Total $23,192,268 

Company  I — 

1920 

January $4,149,000 

February 4,635,000 

March 6,093,000 

April 4,672,000 

May 4.751,000 

June 4,888,000 

July 3,875,000 

August 3,767,000 

September 4,250,000 

October 4,384,929 

November 4,963,000 

December 


770,750 
992,851 
783,825 
957,500 
768,126 


$9,930,628 

1921 

$  482,495 
623,990 
498,723 
825,978 
797,207 
817,278 
722,640 
756,320 
714,000 
663,820 
584,163 


$7,486,814 

1921 
$5,291,926 
5,062,198 
4,958,146 
5,090,717 
5,049,678 
5,864,841 
4,656,257 
4,803,982 
3,295,722 
4,049,545 
4,595,643 


$52,718,655 

1921 

$1,580,821 
1,637,256 
1,679,218 
1,784,360 
1,782,958 
2,704,265 
1,464,051 
1,641,985 
1,671,543 
1,752,018 
1,352,804 


$19,051,269 

1921 
$4,869,000 
4,409,000 
5,499,000 
4,387,000 
4,474,000 
4,882,000 
3,132,000 
3,797,000 
3,048,000 
3,525,805 
3,495,000 


Total $50,427,929 


$45,517,805 


January  6,   1922. 


HE      MONETARY      TIMES 


157 


DEATH  CLAIMS  PAID  BY  REPRESENTATIVE  GO'S 


Company  A — 

1920 

January $    144,140 

February 174,874 

March 250,138 

April 262,961 

May 150,806 

June 276,878 

July 187,651 

August 185,228 

September 217,664 

October 166,035 

November 236,732 

December 

Total $2,253,104 

Company  B — 

1920 

January $      84,510 

February 80,355 

March 144,254 

April 102,439 

May 57,224 

June 78,591 

July 69,675 

August 62,076 

September 150,738 

October 60,923 

November 103,680 

December  . .   . : 

Total $    994,465 

Company  C — 

1920 

January  

February $           500 

March 1,500 

April 

May 

June 150 

July '. ^. . 

August 

September 

October   

November n,  . .  

December 

Total $       2,150 

Company  D — 

1920 

January $      38,746 

February 42,159 

March 67,043 

April 39,231 

May 29,549 

June 33,915 

July 24,956 

August 27,194 

September 25,543 

October 18,470 

November 27,308 

December 

Total $    374,614 

Company  E — 

1920 

January $      20,488 

February 22,374 

March 23,580 

April 27,298 

May 33,999 

June 17,360 


1921 

193,820 

327,051 

220,446 

244,848 

134,089 

136,269 

193,140 

190,444 

285,584 

262,822 

221,085 


$2,409,608 

1921 
$    113,296 

111,409 
72,468 
80,940 
94,141 
93,056 
98,255 
94,709 

110,972 

108,668 
99,863 


$1,087,777 

1921 
$        2,999 


1,898 
6,000 
2,000 


$      12,897 

1921 
$  34,678 
31,933 
84,979 
31,668 
28,151 
21,814 
61,630 
27,913 
23,392 
33,194 
36,104 


$  865,356 

1921 
$  18,500 
26,504 
17,286 
20,500 
22,467 
20,264 


July 14,549 

August 8,208 

September 17,420 

October 11,904 

November 15,531 

December 

Total $    212,701 

Company  F — 

1920 

January $        6,055 

February 13,875 

Maich 11,000 

April 17,917 

May 11,730 

June 17,410 

July 6,000 

August 1,000 

September 1,000 

October 10,400 

November 2,896 

December 

Total $      99,282 

Company  G — 

1920 

January $      61,265 

February 195,631 

March 125,850 

April 86,406 

May 85,986 

June 94,149 

July 87,210 

August 122,193 

September 70,889 

October 118,807 

November 54,699 

December 

Total $1,112385 

Company  H — 

1920 

January $      74,487 

February 68,764 

March 70,957 

April 62,023 

May 89,559 

June 63,496 

July 70,858 

August 33,549 

September  . 39,642 

October 79,636 

l*)vember 36,276 

December 

Total $    689,247 

Company  I — 

1920 

January $      17,497 

February 82,026 

March 170,896 

April 165,333 

May 141,286 

June .-. 132,761 

July 131,963 

August 139,567 

September 144,188 

October 90,464 

November 158,214 

December 

Total $1,372,196 


10.966 
17,257 
15,599 
20,500 
22,359 


$   214,191 


1921 
12,100 

8,(X)0 

9,500 
16,000 
10,500 
14,300 

9,567 

11,978 

14,500 

997 

8,193 


I    116,626 

1921 
$      77,482 

111,681 
53,455 
75,715 
82,150 
71,706 

143,560 

111,333 
93,709 
68,966 

132,786 


$1,022,543 

1921 
$  55,439 
42,666 
64,366 
35,157 
36,568 
51,714 
43,321 
21,726 
31.937 
20,413 
49,764 


$  463,070 

1921 

$   42,736 

97,971 

83,810 

101897 

Ul,006 

115.928 

80,684 

84,176 

89,096 

112.692 

196.266 


11,094,006 


158 


THE      MONETARY      TIMES 


Volume  68. 


Survey  of  Casualty  Insurance  in  1921 

More  Than  Twenty  Different  Lines  Are  Now  Written,  and  Business 
Has  Assumed  Increased  Importance — Effects  of  Year  of 
Depression    Shown    Clearly    in    Decreased    Volume    of    Business 


BY  RANDOLPH  S.  MORTLEY. 


CASUALTY  insurance  in  the  Dominion  of  Canada  has 
become  decidedly  Important.  Grouped  in  more  than 
twenty  classes,  each  class  being  separate  -and  distinct 
from  all  the  others,  the  business  of  Casualty  Insurance 
has  kept  pace  with  the  rapid  growth  of  the  country  In 
population  and  wealth,  until  its  proportions  in  the  var- 
ious classes  have  become  quite  formidable.  The  time 
was  when  "Insurance"  was  generally  understood  to  mean 
simply  the  branches  known  as  life,  fire,  marine,  and  a 
little  later  sickness,  accident  and  guarantee  insurance. 
or  indemnity;  but  now  many  men  own  numerous  kinds 
of  property,  and  illogically  it  is  said,  in  most  cases,  learn 
to  protect  these  various  kinds  of  properties  from  des- 
truction and  loss  much  faster  than  they  acquire  a  full 
appreciation  of  the  greater  advantages  to  be  derived  from 
adequately  Insuring  their  own   more  precious  lives. 

They  know  that  their  houses  may  burn  down  and 
their  businesses  be  shattered  or  wrecked,  that  their 
motor  cars  are  frequently  stolen  and  destroyed,  their 
jewels  and  platedware,  bonds  and  other  much  valued 
securities  may  at  any  time  disappear  through  burglary 
and  "hold-ups";  that  their  large  factories,  contents  and 
staffs  are  liable  to  be  blown  up.  or  seriously  injured  by 
eexplosion,  water,  lightning,  electric,  or  other  atmospheric 
storms;  that  their  prize  live  stock  may  be  suddenly 
killed  in  a  train  wreck,  or  by  shipment,  that  their  crops 
and  even  themselves  may  be  destroyed  by  hail,  tornado, 
or  rain,  etc,  etc, — so  that  they  are  induced  to  secure 
insurance   indemnities  against  all   these   calamities. 

This   Y^ear's  Experience 

As  there  are  various  companies — Canadian  and  for- 
eign— engaged  in  and  actively  competing  for  business  in 
all  these  classes  of  insurance  and  a  few  others  in  Can- 
ada, we  append  a  brief  summary  of  the  year  1921,  as 
far  as  we  have  gone — say,  ten  months — on  the  average, 
based  upon  the  experience  of  the  leading  companies  doing 
business  in  each  department,  with  head  offices  or  branches 
in  Toronto.  As  nearly  all  these  large  corporations  do 
not  issue  statements  until  after  the  beginning  of  the 
year,  it  has  been  found  impractical  to  secure  complete 
reliable  figures,  especially  in  cases  where  the  head  offices 
are  located  in  other  cities,  and  reports  must  be  secured 
from  all  the  branch  offices.  Moreover,  the  collections 
are  largest  in  most  lines  during  the  last  two  months. 
In  some  cases  we  are  enabled  to  make  comparisons  for 
ten  months  of  1921,  with  the  like  period  of  the  previous 
year,  and  as  will  be  seen,  the  percentages  of  increase  or 
decrease  in  new  business  in  new  business  written,  or 
amounts  of  losses  sustained  are  given  by  nearly  all  the 
companies  interviewed.  This  year  of  depression  in  gen- 
eral business  conditions  has  not  proved  to  be  the  most 
favorable  for  these  important  branches  of  insurance,  for 
while  experience  teaches  that  in  marked  times  of  depres- 
sion in  trade  nothing  maintains  such  an  even  keel  as 
all  kinds  of  insurance  business  (from  the  nature  of  its 
service),  even  the  largest  corporations  have  realized  the 
depressing  effect  of  "hard  times,"  and  have  found  great 
difficulty  in  footing  up  totals  as  large  as  in  recent  pre- 
vious years.  Those  companies  operating  in  practically 
all  leading  lines  of  casualty  business  are  of  course  not 
so  liable  to  be  affected  by  the  conditions  a;  other  com- 
panies, and  this  makes  the  difference  between  th(  se  who 
may  be  said  to  have  just  "held  their  own"  and  those  who 
are  compelled  to  admit  a  falling  off  in  volumes  of  bus- 
iness and  premium  receipts,  as  compared  with  1920,  the 
latter  class  would  seem  to  be  in  the  majority. 


In  automobile  insurance,  especially,  this  year  has 
proved  for  the  most  part  unprofitable,  and  some  com- 
panies like  the  U.  S.  Fidelity  and  Guarantee  Co.,  witness- 
ing the  turn  of  events  earlier  in  the  year,  purposely 
caused  a  reduction  in  the  total  volume  of  business 
written  in  the  larger  cities  particularly,  and  as  a  result 
of  their  prudence,  they  are  able  to  show  a  more  favor- 
able loss  ratio,  as  compared  with  1920,  than  some  ot 
their  competitors.  As  will  be  seen  by  our  special  article 
elsewhere  in  this  paper,  this  department  of  casualty  vusi- 
ness  constitutes  one  of  the  "high  spots,"  or  low  spots,  in 
underwriting  in  Canada  in   1920. 


HEAVY    SIARINE    LOSSES   IN    1921 


Losses  Were  Over  One  Hundred  Per  Cent.,   According  to 
BiStlmates  of  Lea<ling  Underwriters 


MARINE  insurance  protects  policyholders  against  risks 
connected  with  navigation  to  which  ships,  cargoes, 
freight,  profits  or  other  insurable  interests  may  be  exposed 
during  voyages  or  fixed  periods  of  time.  An  almost  infinite 
variety  of  marine  policies  are  is.sued  to  meet  the  different 
special  requirements.  The  simpler,  best  known  forms  are 
'■Hull  Insurance  Policies,"  which  cover  ocean  and  inland  ves- 
sels, steam  and  gasoline  yachts,  etc.  The  terms  and  provi- 
sions of  these  policies  depend  upon  the  courses  to  be. navi- 
gated, as  well  as  the  type  and  construction  of  the  vessels 
insured.  The  "Constnictors'  Risk"  covers  a  vessel  being 
built  in  the  yards  from  the  time  the  material  is  collected 
until  completion,  including  trial  trips  before  the  vessel  is 
turned  over  to  it.s  owners.  Annual  policies  are  written  to 
cover  steamers  navig<iting  coastwise  in  inland  waters,  and 
in  the  transatlantic  or  Pacific  trade.  Of  wider  interest  to 
business  men  is  the  "Marine  Cargo  Open  Policy,"  insuring 
merchandise  against  fire,  collision  and  derailment  while  on 
board  freight  cars  or  en  route  to  the  docks;  against  damage 
by  fire  and  perils  of  the  sea,  including  sinking,  stranding 
and  collisions;  also  against  fire  and  flood  at  seaports  during 
tho  course  of  trans-shipment. 

This  business  was  formerly  handled  by  large  brokerage 
offices  in  the  principal  seaports,  but  now  that  shipments  from 
all  parts  of  the  country  have  become  so  numerous,  manufac- 
turers and  merchants  demand  more  convenient  direct  service, 
hence  insurance  agents  in  all  parts  of  the  country  may  assist 
shippers.  Rates  necessarily  vary,  according  to  the  kind  of 
merchandise,  places  of  destination,  shipping  routes,  etc.,  and 
are  easily  obtained  from  the  marine  insurance  companies 
listed  in  the  blue  books,  city  and  business  directories. 

Past  Year's  Losses  Heavy 
In  Canadian  marine  insurance  circles  1921  was  an  event- 
ful, stormy  year,  full  of  changes,  unusually  big  losses  and 
raising  of  rates.  Some  well-known  leading  companies  report 
that  on  the  whole  the  volume  of  business  was  fair,  and  would 
have  b^en  largely  in  excess  of  that  for  the  previous  year,  with 
profits  correspondingly  greater,  but  for  the  enormous  losses 
at  sea — chiefly  of  schooners — by  fire  as  well  as  sinking.  On 
the  Atlantic  coast  especially  the  schooner  hull  insurance  was 
decidedly  bad,  owing  in  great  measure  to  the  inflated  values 
of  vessels,  it  is  thought.  During  the  war  the  vessels  were 
"boosted"  to  very  high  figures,  and  since  1919  values  have 
been  steadily  declining,  until,  as  in  the  case  of  automobiles, 
the  amounts  for  insurance  were  soon  out  of  all  proportion 
to  the  reduced  values  of  schooner  hulls;  besides,  there  were 
numerous  fires,  the  origin  of  many  never  having  been  satis- 


January   6,   1922. 


THE       MONKTARY       TIMES 


15» 


factorily  {leterniined.  Not  many  weekw  a^o,  last  fall,  a 
schooner  put  in  at  Turk's  Island  in  the  West  Indies  for  a 
load  of  salt.  The  captain,  who  was  reported  ill,  had  gone  to 
bed  in  his  cabin,  and  the  mates  were  also  lying  down,  when 
some  of  the  crew  from  below,  sniffing  the  smell  of  smoke, 
came  to  the  upper  deck  only  to  discover  the  hull  on  fire  be- 
yond hope  of  redemption — and  all  e.scaped  to  shore,  while  the 
vessel  burned  to  the  water's  edge. 

This  is  only  one  of  many  cases  that  could  be  cited  to 
explain  why  the  losses  which  during  the  years  of  1918  to 
1920  showed  a  ratio  of  33  per  cent,  were  increa.sed  to  over 
100  per  cent,  in  1921.  A  prominent  British  company,  with 
offices  in  Toronto,  paid  for  losses  last ,  year  of  about  40 
schooners,  amounting  to  pi-obably  $150,000,  as  their  own  pro- 
portion; and  thi.s  does  not,  of  course,  include  the  los.ses  by 
destruction  of  the  cargoes. 

Export  Insurance — Business  in  this  was  comparatively 
light  during  last  sea.son,  owing  partly  to  the  unfavorable  con- 
dition of  the  exchange  market,  resulting  in  unprecedentedly 
hight  rates.  The  pilferage  hazard,  too,  since  the  war  has 
been  .so  great  that  many  of  the  companies  had  to  cut  out  a 
lot  of  the  theft  business  offering,  thu.s  decreasing  their  total 
premiums  to  below  the  totals  of  1920  and  some  previous 
years.  In  fact,  the  pilferage  hazard  became  so  utterly  bad 
that  rates  on  shipments  of  merchandise  to  the  Far  East, 
India,  Australia  and  South  America  were  all  raised  and  were 
coirparatively  high  during  the  last  two  years.  Some  articles 
of  dry  goods,  for  instance,  which  formerly  were  carried  for 
.02 %c  per  $100,  were  last  year  rated  at  70c.  Before  the  war 
some  of  these  smaller  articles  were  carried  free;  now  the 
Asiatic  ports  refu.se  to  insure  pilferage  ri.sks,  and  all  under- 
writers have  ceased  to  cover  the  hazard  on  shipments  to 
Central  and  South  America,  India  and  the  Eastern  Mediter- 
ranean. 

Iiiiport.s  Insiiruiice. — The  volume  of  insurance  and 
premium  receipts  for  coverage  of  imports  last  year  showed 
a  considerable  increase  compared  with  1920,  but  the  total 
of  losses  was  much  larger,  tor  much  heavier  amounts,  than 
in  pre-war  days.  This  condition  is  attributable  mainly  to 
the  unsettled  labor  conditions  and  increased  crime  wave 
since   the   war,   together   with   the   depreciating  values.     In 


the  marine  department  there  was  plenty  of  business  offering 
in  1921,  and  competition  for  it  was  keen,  which  tended  to 
reduce  profits,  but  the  companies  report  that  the  trend  In 
shipping  conditions  Is  towards  Improvement.  More  care  l» 
being  exercised  on  the  part  of  shippers,  which  helps  to 
better  the  conditions;  premium  companies,  some  of  whom 
have  learned  lessons  by  their  experience  last  year,  are  now 
averse  to  accepting  accounts  with  "frills"  or  fancy  condi- 
tions. They  stand  perfectly  willing  to  pay  all  legitimate 
losses,  the  result  of  an  "act  of  God,"  of  which  there  were 
many  last  season.  On  or  about  December  4lh  last  a  great 
storm  swept  over  Newfoundland,  causing  the  loss  of  17 
sailing  vessels;  another  severe  storm  visited  the  Upper 
Lakes  in  December,  without  severe  losses,  however,  and 
during  the  hurricane  season  in  the  West  Indies  last  fa! 
there  were  20  lighters  sunk  In  a  single  port. 


FIRK  AND  EMPLOYERS'   MABILITV    LINKS 


These  Show  RetliKtion  of  AI)oiit   20   Ter  <  «nt.   In   Premluni 
Inconu*.  Says  One  Company  .Manager 


OUTLINING  the  developments  of  the  past  year,  the  gen- 
eral manager  of  one  of  the  large  British  companies 
doing  business  in  Canada  said  to  The  Monetary  Times: — 

"With  the  exception  of  the  exception  of  the  Fire  and 
Employers  Liability  Departments  it  would  appear  that  the 
premium  income  for  the  ten  months  ending  October  3lst, 
1921,  for  each  department  is  practically  the  same  as  for 
the  corresponding  period  of  1920. 

"The  Fire  and  Employers  Liability  Departments  indi- 
cate a  reduction  of  approximately  20  per  cent,  in  premium 
income^accounted  for  by  diminution  in  values,  and  reduc- 
tion in  wages  expenditure,  consequent  upon  diminished  pro- 
duction in  the  factories  of  the  Dominion. 

"Claims  as  a  whole  seem  to  bear  about  the  same  pro- 
portion to  total  premium  income  as  for  the  corresponding 
period  of  1920.  It  may  be  expected  that  there  will  be  some 
increase  in  the  fire  loss  ratio  for  the  year  1921  as  compared 
-with  the  year  1920." 


Recent  Tendencies  in  Life  Insurance 

An  Examination  of  Deaths  and  Their  Causes — Exper- 
iences fo  United  States  and  Canadian  Companies  for  the 
Past  Few  Years — First  10  Months  of  1921  Show  Decrease 


BY    ROBERT    LYNN    COX,   THIRD   VICE-PRESIDENT,   METROPOLITAN  LIFE  INSURANCE  COMPANY. 
An   Address    at   the    Fifteenth   Annual    Convention   of   the   Association  of  Life  Insurance  Presidents    in  New  York  City. 


■yHE  business  of  Life  Insurance  has  grown  within  recent 
1  years  to  most  impressive  size.  This  is  at- 
tributable directly  to  the  ability  of  its  exponents 
to  make  men  think  of  life  and  death  In  econo- 
mic terms.  Life  Insurance  has  taught  the  world 
that  in  one  sense  .It  pays  to  raise  men  and  women  just 
as  it  pays  to  raise  horses  and  cattle.  It  pays  in  dollars.  Men 
understand  now  pretty  generally  that  what  human  beings 
can  earn  beyond  their  "board  and  keep"  can  be  measured— 
that  is  to  say  this  can  be  done  with  reference  to  that  imagin- 
ary being  known  as  "Mr.  Average  Man."  What  he  is  worth 
toward  increasing  the  capital  of  the  world  can  be  definitely 
foretold  and  calculated.  We  know  within  a  few  days  or  weeks 
of  how  long  he  will  live  and  just  about  what  he  would  bring 
if  he  could  be  put  upon  the  auction  block.  Uncertainty  as  to 
the  span  of  life  relates  only  to  the  individual  life.  Death 
holds  no  terror  of  uncertainty  for  Mr.  Average  Man.  Statis- 
tics based  upon  the  actual  experience  of  Life  Insurance 
companies  have  proven  absolutely  the  number  of  his  years. 
He  neither  fears  loss  nor  hopes  for  more.     He  knows. 


Now  the  business  of  Life  Insurance,  speaking  from  the 
cold  standpoint  of  figures,  is  merely  a  plan  for  converting 
the  fearsome  individual  of  unforeseeable  years  of  life,  and 
therefore  of  unknown  econtmic  worth,  into  an  average  man 
with  a  cert-iin  number  of  years  to  live  and  therefore  of  well 
known  and  very  definit*  worth.  In  fact,  there  is  more 
certainty  today  of  what  a  fully  insured  man  is  worth  dead 
than  what  he  is  worth  alive.  Dead,  he  is  worth  as  much  as 
the  average  nan  or  more.  .\live,  through  sickness  or 
accident  or  dissipation,  he  may  be  converted  at  any  moment 
into  a  liability. 

It  is  fortunate  that  this  scheme  for  guaranteeinT  • 
definite  nun-ber  of  economic  years,  or  we  might  say  for 
capitalizing  the  ecnoniic  worth  of  each  individual  life,  can  be 
done  on  the  installi.ient  plan,  with  comparativelv  sriall 
pnnunl  outlay.  This  has  brought  Life  Insurance  within  the 
reach  of  j>11.   and  carried  it  into  n;ost  horres  in  th'5  co"n*rv 

We.  as  Life  Insurance  men.  see  the  problem  of  '"Nat"on»l 
Health  in  our  Life  Insurance  Mirror"  as  an  economic  prob- 
lem of  wide  interest  and  great  importance.  We  see  it 
through  the  eyes  of  forty  million  people  with  whom  we  have 


160 


THE      MONETARY      TIMES 


Volume  68. 


contiacts  airectly  related  to  the  length  of  time  they  are 
exp.cttd  to  live.  Ul  necessity  we  approach  this  question,  as 
we  do  all  others,  troai  the  standpoint  of  Mr.  Average  Man, 
the  man  who  aetermines  what  kind  of  policies  we  shall  issue 
and  whose  life  expectancy  fixes  our  premium  rates  therefor. 
We  would  inquire  concerning  what  is  being  don©  to  improve 
Health  lor  him. 

We  know  that  if  our  business  were  a  lodge  or  society 
which  had  power  to  endow  each  member  with  a  definite  num- 
ber of  years  of  life,  such  as  we  know  are  guaranteed  to  the 
Average  Man — say  35  years  for  a  man  30  years  old,  28  years 
for  a  man  of  40,  20  years  for  a  man  of  50,  and  so  on — 
initiation  fees  and  annual  dues  in  such  an  organization  might 
be  fixed  high  enough  to  compare  with  admission  fees  and 
dues  in  an  up-to-date  golf  chib.  We  know,  but  have  a  hard 
time  convincing  men  outside  of  our  business  that  men  who 
take  out  and  maintain  an  adequate  amount  of  lite  insurance 
receive  an  absolute  guarantee  of  the  length  of  their  economic 
lives,  a  guarnntee  that  as  to  their  net  earning  power  each 
shall  live  his  full  measure  of  life  expectancy.  Seeing,  as  we 
must  and  clearly  do  that,  the  dollar  and  cent  worth  of  years 
of  living,  let  us  turn  now  to  some  recent  figures  which  show 
how  closely  we  are  in  touch  with  the  losses  caused  by  deaths 
among  the  creators  of  the  wealth  of  the  world. 

The  deatli  claims  paid  by  the  Life  Insurance  companies 
of  the  United  States  for  the  year  1920  amounted  in  round 
numbers  to  $350,000,000.  Most  of  this  was  paid  on  insured 
men,  women  and  children  who  died  prematurely.  In  fact,  life 
conservation  work  as  it  has  been  developed  in  the  last  two 
decades  has  demonstrated  to  the  point  of  reasonable  certain- 
ty that  not  less  than  one-third  and  perhaps  even  one-half  of 
all  deaths  which  occur  in  any  one  year  might  be  postponed 
to  subsequent  years  varying  in  number  somewhat  according 
to  geographical  location,  nationality,  occupation,  working 
conditions,  etc.  It  has  been  shown,  for  example,  in  the  exper- 
ience of  one  life  insurance  company  that  within  a  period  of 
ten  years,  the  lowering  of  the  death  rate  that  has  actually 
been  achieved  is  equivalent  to  having  added  four  years  to 
the  average  life  expectancy  of  its  male  policyholders.  If 
America  could  remove  Tuberculosis,  from  among  the  causes 
of  mortality,  which  has  long  been  the  ambition  of  those 
engaged  in  public  health  work,  it  would  be  equivalent  to 
adding  at  least  three  years  to  the  average  life  span  of  the 
entire  population. 

Similar  estimates  made  for  other  preventable  diseases 
indicate  that  life  expectancy  can  very  reasonably  be  extend- 
ed to  an  average  maximum  of  seventy  years  instead  of  a 
maximum  of  fifty-one  years,  as  shown  by  the  Life  Tables  of 
1910.  In  terms  of  the  whole  nation,  such  life  extension  makes 
for  such  enormous  increase  of  national  values  that  the  effort 
would  be  fully  justified. 

Carefully  prepared  estimates  based  on  government  cen- 
sus figures  show  that  the  net  gain  in  economic  wealth  of  this 
country  is  at  the  rate  of  about  $100  per  person  per  annum. 
As  this  rate  is  reached  by  including  in  the  calculations  not 
only  minor  children  but  also  the  sick,  disabled  and  aged,  it  is 
not  difficult  to  realize  the  far  greater  economic  worth  of  the 
really  productive  people  of  the  country,  upon  whom  falls  the 
burden  of  doing  the  world's  work. 

Assuming,  as  I  think  we  fairly  may,  that  on  the  average 
productive  male  members  of  the  race  are  worth  "net"  to  the 
world  at  least  $500  a  year  each,  (that  is,  each  is  worth  $500 
over  food,  clothing,  shelter  and  other  costs  of  his  personal 
maintenance)  we  get  a  new  view  of  what  life  prolongation 
means  in  money's  worth. 

Nine  million  men  are  said  to  have  been  killed  in  the 
great  world  war — nine  million  men  whose  average  life  expec- 
tancy was  about  thirty-five  years.  This  means  that  315,000,- 
000  years  of  productive  human  activity,  worth  $500  a  year 
net,  was  thus  lost  to  the  world.  Expressed  in  dollars  it  means 
that  one  hundred  and  fify-eight  billion  dollars  worth  of 
human  lives  were  destroyed  by  this  war.  Added  to  this,  per- 
haps as  much  ^nore  was  lost  by  the  disablement  of  those  who 
still  live  but  who  have  been  converted  into  human  liabilities 
— not  only  worthless  as  producers  but  who  from  now  on  must 
consume  wealth  that  is  being  produced  by  others. 

Men  are  accustomed  to  calculate  the  economic  cost  of 
the  war  only  in  value  of  material  thinirs  destroyed  and 
supplies  wasted,  but  in  the  Life  Insurance  Mirror  we  see  this 


laigtr  loss  of  human  economic  value  that  likewise  was  des- 
cioyed  and  is  now  gone  forever. 

But  this  view  is  retrospective,  resting  upon  that  which 
.s  irreparably  lost.  It  is  a  sorry  picture^  Let  us  face  foi'ward, 
u&ing  our  lessons  of  the  past  to  prevent  if  possible  a  repeti- 
tion of  such  colossal  mistakes  in  the  future. 

For  the  avoidance  of  wholesale  slaughter  hereafter,  we 
in  common  with  other  citizens  with  neither  power  nor  respon- 
sibility, must  rely  upon  those  great  statesmen  and  world 
leaders  .assembled  at  Washington,  to  find  ways  of  preventing 
future  V7ars.  But,  as  patriotic  citizens  of  the  United  States 
and  Canada  engaged  in  the  business  of  Life  Insurance,  may 
there  not  be  something  worth  while  we  can  do  to  prolong  the 
lives  of  those  who  still  live  and  of  those  who  are  to  be  born 
hereafter  and  thus  make  up  in  part  at  least  for  our  great 
war  loss  of  human  assets  ? 

In  order  that  we  may  see  both  our  problems  and  our 
opportunities,  the  Association  of  Life  Insurance  Presidents 
has  obtained  from  leading  American  Life  Insurance  compan- 
ies, and  this  enabled  me  to  present  in  connection  herewith  in 
tabular  form,  certain  statistics  relating  to  deaths  and  causes 
of  deaths  for  the  first  ten  months  of  1921  and  for  the 
corresponding  period  of  1920. 

The  striking  thing  shown  by  these  figures,  covering 
27,000,000  human  lives,  which  of  necessity  reflect  general 
health  conditions  throughout  the  country,  is  the  extraordin- 
arily favorable  mortality  of  the  current  year  in  comparison 
with  the  year  1920 — a  year  which  up  to  that  time  was 
one  of  the  best  which  life  insurance  companies  had  ever 
experienced.  These  figures  for  ten  months  of  1921, 
supplemented  by  what  we  know  of  our  mortality  experience 
as  it  has  been  running  since  October  31st,  show  that 
the  United  States  and  Canada,  as  a  whole,  will,  close 
the  year  1921  with  a  lower  death  rate  than  has  ever 
been  experienced  by  these  countries  in  any  calendar  year  of 
their  history.  Let  us  tr.-'.nslate  this  f^.ct  into  number  of  lives 
saved  in  1921.  The  thirty-seven  life  insurance  companies 
contributing  these  figures  transact  about  80%  of  the  life 
insurance  business  of  the  country  and  the  figures  actually 
submitted  for  the  first  ten  months  of  this  year  in  comparison 
with  the  first  ten  months  of  last  year  are  from  a  group  of 
policies  representing  in  point  of  number  55%  of  all  now  out- 
standing in  the  United  States.  Combining  both  Ordinary  and 
Industrial  life  insurance  business,  these  thirty-seven  compan- 
ies report  that  while  they  experienced  in  the  first  ten  months 
of  1920,  deaths  numbering  205,941,  for  the  same  period  this 
year  only  184,860  deaths  have  occurred.  This  shows  a 
reduction  of  21,081  in  the  actual  number  of  their  death  losses 
this  year.  But  this  Irrge  number  does  not  tell  with  entire 
accuracy  the  whole  story  of  the  life  saving  of  the  year 
because  it  covers  only  the  months  and  the  deaths  of  1921 
occurred  among  a  greater  number  of  lives  at  risk.  By  using 
these  facts  to  correct  our  calculations  it  may  be  said  that 
the  net  saving  for  this  group  of  life  insurance  companies  will 
amount  to  at  least  26,402  lives.  Stated  in  the  usual  mortality 
ratios,  it  means  that  the  death  rate  of  this  year  for  these 
companies  will  be  8.24  per  thousand  instead  of  9.58  per 
thousand,  as  it  was  in  1920. 

This  mortality  gain  translated  into  money  saved  in  the 
payment  of  death  claims  by  all  life  insurance  companies  of 
the  United  States  for  1921,  measured  by  outstanding  insur- 
ance, will  amount  in  round  numbers  to  at  least  $51,000,000. 
This  vast  sum,  with  the  gains  made  in  1920,  will  go  far 
toward  making  up  the  excess  losses  of  1918  and  1919 
occasioned  by  Influenza,  estimated  conservatively  at  more 
than  $170,000,000.  ,     ^ 

Using  the  United  States  Census  Bureau's  figures  for 
1920  for  the  registration  area  of  the  United  States  repre- 
senting eightv-two  per  cent  of  the  population,  we  find  the 
total  officially  recorded  deaths  for  last  year  were  1,142,578. 
Taking  the  same  rate  of  mortality  for  18%  not  covered  by 
the  registration  area,  we  reach  an  estimated  total  of  1,389,998 
deaths  in  the  United  States  for  1920.  Applying  the  saving  of 
one  and  one-third  lives  per  thousand  experienced  by  lite 
insurance  companies  for  the  first  ten  months  of  this  year  to 
the  population  of  the  United  States  and  Canada,  we  find 
there  will  be  in  these  t-wo  countries  a  probable  saving  of 
l.t^sono  lives  in  1921  over  1920. 

Let  us  look  now  at  the  various  causes  of  death  as  they 


January  6,  1922. 


THE      MONETARY      TIMES 


1«1 


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■lJMiimi!tWl:1WI  1 1 


The    Prudential 

Insurance  Company  of  America 


Established  1875 


Entered  Canada  1909 


Over  eight  hundred  Canadians  are  employed  in  the 
fifty  branch  offices  of  the  Prudential  in  the 
Dominion  o  Canada,  clearly  emphasizing  the 
character  of  the  Prudential's  Canadian  Organi- 
zation. The  Prudential  deposits  in  the  leading 
banks  of  the  Dominion,  invests  in  Canadian 
Government  Bonds,  helps  Canadian  city  and 
town  improvements  through  the  purchase  of 
Municipal  Debenture  Bonds  and  pays  out  hun- 
dreds of  thousands  of  dollars  in  claims  and 
dividends  each  year  to  the  Canadian  policy  ho  ders 

The  Prudential  is,  in  truth,  living  up  to  its 
slogan    in    Canada  : — 

"  AN  AMERICAN  COMPANY  DOING 
BUSINESS  WITH  CANADIANS  — 
THROUGH    CANADIANS." 

And  your  premiums  paid  on  Prubential  policies 
are  not  only  safe,  but  always  at  work,  in  the 
Dominion,  making  better  cities,  better  towns, 
better    farms    and    better    homes. 


The  Prudential 

Insurance  Company  of 
America 

Incorporated  under   (he  Uwi 
Stiteof  Ntw  J« 


Pretident— 
Forrest  F.  Dryden, 

Home  Office — 
Newark    -    New  Jersey 


iiiiiiiiiiiiimiMniwi>iii«i«muiiiiiiiiiniiiiiii»ii»iu»iiuiiiiiiiiiuiiiniiiiiniiiiiiiiuiittiiiii»iwaMi 


162 


THE       MONETARY       TIMES 


Volume  68. 


are  shown  in  the  tables  submitted  herewith,  covering  184,860 

cases  occurring  during  the  first  ten  months  of  1921  : 

Causes  of  Death    Showing    Decreases   in  Rate  for  the  First 

Ten  Months  of  1921  in  Comparison  with  the 

Corresponding  Period  of  1920. 

1st  10  mos.     1st.  10  cnos. 

1920  1921 

Influenza 14,941  1,730 

Pneumonia    (all  forms)    22,243  13,708 

Tuberculosis   (all  forms)    25,288  22,443 

Other  respiratory  diseeaes 3,489  2,732 

Bright's    disease 14,652  14,359 

Puerpetual    state   3,429  3,125 

Measles     1,148  492 

Whooping;    cough   895  547 

Meningitis  (§11  forms)    881  782 

Diarrhoea  and  enteritis 2,392  2,327 

Typhoid  fever 1,328  1,379* 

Cerebral    hemorrhage   12,732  12,838* 

Organic  diseases   of  heart 23,738  24,415* 

External  causes  (excluding  suicides, 
homicides  and  automobile  acci- 
dents)           10,481  10,084 

Miscellaneous    ; 45,035  47,403* 


182,672  IS'^.^-'i 

*  Thou"-h  certain  causes  of  death  show  increases  in 
actual  number  of  deaths  for  1921  over  1920,  the  rate  per 
thousand  is  in  fact  lower  because  of  the  increased  number  of 
lives  at  r'?k  '"n  1921. 

Causes  of  Death   Showing  an  Increase  in  the  Death  Rate 

Cancer 14,604  15,865 

Suicides    2,096  2,852 

Homicides    1,052  1,322 

Automobile  accidents  and  injuries  . . .  2,311  2,624 

Scarlet  fever 651  942 

Diphtheria 2,555  2,891 

23,269  26,496 

Grand  Total,  All  Cau«es 205,941  184,860 

We  note  first  that  fifteen  out  of  the  twenty-one  classified 
causes  of  death  siiow  a  lower  rate  than  they  had  for  the  year 
1920.  In  some  instances  the  reduction  is  very  striking.  Only 
six  out  of  the  twenty-one  show  increases.  It  may  be  of 
interest  to  consider  some  of  the  more  important  ones  in 
relation  to  the  problem  of  improving  average  mortality. 

We  see  at  the  outset  that  about  28%  of  deaths  during 
this  year  have  been  caused  by  diseases  which  under  our 
present  habits  of  life  are  pretty  sure  to  continue  at  high 
ratios  among  the  various  causes  of  death.  These  diseases  are 
cerebral  hemorrhage,  organic  diseases  of  the  heart  and 
Bright's  disease.  In  the  main  they  are  ailments  of  the  ^lore 
advanced  years  of  life.  To  a  very  great  extent  they  mark 
organic  and  functional  break-downs.  Therefore  we  turn  for 
hope  to  the  other  causes  of  death  constituting  72  Tr  per  cent, 
of  the  total.  It  is  among  them  that  we  must  seek  large 
results  in  the  nrolono-ation  of  the  average  human  life. 

Though  we  lenm  that  tuberculosis  has  caused  the  enor- 
mous total  of  22,443  deaths,  that  is  to  say  about  one  in  eight 
of  all  deaths  that  have  occurred  in  1921,  we  have  in  min-1  for 
purno^es  of  comrarison  the  fact  that  no  longer  than  ten 
years  ago  its  ratio  stood  at  causing  nearly  one  death  among 
every  fou'r.  This  remarkable  drop  in  the  tuberculosis  death 
rate  is  one  of  the  most  conclusive  proofs  of  how  much  can  be 
accomplished  when  cause  and  cure  of  a  disease  become 
matters  of  common  knowledge  and  of  community  concern. 

Within  very  recent  years  typhoid  fever  has  been  relegat- 
ed to  a  place  of  minor  in^portance.  though  in  forTnev  years  it 
played  sad  havoc  with  the  lives  of  our  people.  This  in  large 
part  is  true  of  diphtheria- — that  dread  destroyer  of  child  life 
for  centuries  past,  which  in  recent  years  has  been  largely 
brought  under  medical  control  and  thereby  put  in  a  compara- 
tively minor  nlace^amcne  the  causes  of  death. 

But  a  comparison  of  deaths  in  1921,  with  1920  and  earl- 
ier years,  shows  such  an  alarming  increase  in  the  mortalitv 
caused  by  these  two  diseases  ps  to  teach  us  that  eternal 
v'gilance   and   constant  anplicat'on   of  medical  knowledge  is 


the  price  we  must  pay  tor  escape  from  death-dealing  micro- 
organisms. There  is  really  no  longer  a  good  reason  why 
typhoid  fever  or  smallpox  or  diphtheria  should  be  an 
epidemic  in  this  country  and  yet  we  find  them  rising  too 
trequently  to  that  proportion  in  certain  localities  because 
people  either  fail  or  refuse  to  employ  the  means  through 
which  they  had  been  brought  almost  to  the  vanishing  point 
as  causes  of  death. 

Deaths  from  pneumonia,  as  reported  in  these  tables, 
were  only  13,708  in  1921  as  compared  with  22,243  in  1920,  an 
actual  reduction  from  this  cause  alone  of  8,535  deaths,  or 
nearly  40%.  If  we  take  into  consideration  the  greater 
number  of  lives  at  risk  in  1921,  we  might  say  that  pneumon- 
ia is  only  about  one-half  as  serious  a  cause  of  death  this 
year  as  it  was  last  year.  Such  a  large  and  important  varia- 
tion as  this  certainly  calls  loudly  for  more  intensive  study  of 
its  causat'on  and  methods  of  prevention  in  order  that  we 
may  be  sure  of  holding  the  gain  achieved  in  1921. 

The  most  amazing  factor  in  the  health  situation  of  the 
year  is  the  almost  complete  disappearance  of  influenza  as  a 
cause  of  death.  Only  1,730  deaths  are  reported  for  ten 
months  of  1921.  as  against  14,941  for  the  corresponding 
period  of  1920  which  was  not  regarded  as  an  epidemic  year. 
In  fact  the  rate  has  been  lower  in  1921  than  for  any  other 
year  within  the  last  ten,  and  there  is  no  indication  of  any 
upward  tendency  as  the  year  is  drawing  to  an  end. 

But  there  are  always  some  exceptions  to  be  noted  and 
mention  must  now  be  made  of  certain  causes  of  death  that 
are  shoving  increases  over  those  of  last  year.  Suicides  and 
hom.icides  amounting  to  4,174,  have  increased  by  the  number 
of  1,026  or  abcut  four  times  what  the  increase  would  have 
been  had  the  rate  per  thousarfd  of  1920  remained  constant 
for  1921.  This  doubtless  is  a  direct  result  of  war  reactions, 
business  depression,  unemployment  and  other  phases  of  eco- 
nomic disturbance,  ard  will  largely  cure  itself  as  times 
improve. 

A  matter  of  no  small  concern  among  the  increasing 
causes  of  death  is  the  steadily  mounting  mortality  caused  by 
automobiles  and  other  motor-driven  vehicles.  The  number  of 
deaths  in  1921  reported  by  the  life  insurance  companies  that 
furnished  their  fi'7ures  for  the  com.pilation  on  which  this 
paper  is  based,  was  2,624,  which  is  an  increase  of  nearly 
15%  over  1920. 

We  are  rightfully  concerned  over  untimely  deaths  caused 
by  micro-organisms  of  the  vegetable  and  animal  kingdoms 
and  are  willing  to  spend  time  and  money  freely  in  trying  to 
isolate,  study  and  catalogue  them,  to  the  end  that  their  rava- 
ges may  be  held  in  cheek.  We  talk  learnedly  of  bacteria  and 
bacilli  but  overlook  the  "Biicillus  Automobilis."  whose  pres- 
ence behind  the  wheel  of  his  juggernaut  can  be  discovered 
without  aid  from  the  microscope  and  whose  homicides  might 
be  largely  prevented  by  more  effective  policing  of  our 
congested  highways.  Our  experience  for  ten  months  shows 
that  ten  thou-and  human  lives  will  be  brought  to  premature 
deaths  in  1921  by  motor-driven  vehicles,  at  an  economic  loss 
to  the  world  of  at  least  $25,000, 000,and  yet  we  are  in  the 
habit  of  counting  rut  — obil'ng  cost  in  terms  only  of  cars, 
gasoline,  tires  rnd  accersories. 

As  members  of  the  human  race,  we  sense  as  other  men 
do,  the  rgonies  of  the  heart  that  result  from  family  separa- 
t'ons  and  ve  sympathize  fully  with  our  fellow  men  in  the 
mental  suffcr'ng  occasioned  by  the  deaths  of  the  loved  ones. 
But  as  li'e  in  urance  men  we  are  compelled  to  go  further 
and  c^'nt  o'^ber  costs  as  well.  In  some  respects  we  are  like 
the  T?ed  Cross  workers  behind  the  battle  line.  We  count  the 
dead  and  succor  the  wounded.  We  are  back  of  every  sector 
on  which  the  enemy  is  making  an  attack.  We  know  each  day 
how  many  have  fallen  and  from  what  causes.  We  record  and 
tabulate  our  information  months  and  almost  years  ahead  of 
the  reports  that  are  given  out  from  headquartei^s  in  Wash- 
ington. Does  it  not  seem  that  in  some  way  we  should  arrange 
for  more  direct  communication  and  greater  co-operation  with 
the  forces  that  are  fighting  the  battle  for  better  health  and 
longer  average  life  ?  From  the  nature  of  our  business  and 
its  wide  spread  over  the  ent're  country  and  in  all  kinds  of 
homes  we  know  better  and  sooner  than  any  other  organiza- 
tion or  agency  the  trend  of  nublic  health  and  just  what  is 
causing  deaths  among  the  neople  from  week  to  week.  Why, 
therefore,   should   we   not  resolve  here  and  now  t<v  make  the 


January  6,  1922. 


THE      MONETARY      TIMES 


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The    Mutual     Life     Assurance 
jCompany  of  Canada 

WATERLOO  -  -  ONTARIO 


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The  Strength 
of  the  Mutual 

By  C.  M.  Bowman 

Chairman  of  the  Kxecutlve  ofthe  Mutual  Life  of  Canada 


The  liolder  of  every  life  insurance  policy  is  en- 
titled to  security  that  will  produce  absolute  confi- 
dence of  safety  when  tlie  most  searchiiiL--  acid  test  is 
applied. 

In  order  lo  ^et  the  maximum  amount  oi  security 
for  the  policyholders  of  a  Life  Company,  much  more 
is  involved  than  merely  the  secure  investment  of 
funds. 

As  to  investments,  there  are  two  features  to  be 
considered.  First,  that  of  safety,  which  is  a  para- 
mount consideration.  Second,  that  of  interest  yield, 
which  is  subsidiary. 

The  total  investments  of  the  tOmiiaiiy  are  re- 
markable in  their  results.  We  have  invested  in  all 
.'t:64,26o.06<).79.  Lpon  analy/.intr  the  Profit  and  Loss 
account  we  find  that  the  few  losses  in  interest  would 
not  amount  to  more  than  1  700  of  one  per  cent,  per 
annum,  a  truly  aiuazinjr  record,  while  for  numy 
years  the  Mutual  Life  has  enjoyed  the  highest  earn- 
injjs  of  any  Company  of  the  same  size  and  age. 

But  there  is  a  far  frreater  element  of  security 
than  any  of  those  hitherto  mentioned,  namely,  the 
tradition  which,  handed  down  from  year  to  year. 
was  estalilished  by  our  Founders.  The  Institution  is 
rpsiardcd  as  a  Trust  and  every  act  of  the  Executive 
is  (Ictermined  by  that  fundamental  idea.  It  is  the 
Soul  of  the  Mutual—the  Spirit  of  the  Enterprise 
which  has  revealed  itself  in  an  invaluable  service  at 
a  minimum  cost  to  the  public.  Thousih  the  (Uitward 
form  of  the  Company  may  chanjfe  the  animatiuL' 
Sjiirit  will  remain  ever  the  same. 


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164 


THE      MONETARY      TIMES 


Volume  68. 


Association  of  Life  Insurance  Presidents  a  statistical  clear- 
ing house  to  which  we  shall  henceforth  report  deaths  and 
causes  of  death  every  month,  to  the  end  that  the  Association 
may  in  turn  tabulate  them  and  make  reports  in  aggregate 
to  such  Government  and  State  Departments  as  need  such 
information  and  will  use  it  in  fighting  the  battle  for  better 
National  Health  and  longer  life  for  Mr.  Average  Man — for 
him  who  is  the  composite  of  us  all. 

Treatment  and  cure  of  disease  will  always  be  in  demand, 
of  course,  but  we  must  look  to  preventive  medicine  for  large 
results  in  the  prolongation  of  human  life.  Great  progress 
has  been  made  within  very  recent  years  and  it  may  possibly 
be  that  the  lowered  death  rate  of  1921  is  the  beginning  of  a 
fulfillment  of  prophecies  made  a  few  years  ago,  that  the 
average  span  of  life  would  some  day  be  lengthened  b  y 
several  years.  However  that  may  be,  let  us  form  as  many 
alliances  as  possible  and  consolidate  our  forces  with  a  view 
to  holding  the  very  substantial  gains  we  have  made.  To  revive 
a    war   phrase,    "Let  us  dig  in,   on  the  line  of  our  advanes." 


We  see  in  the  Life  Insurance  Mirror  more  clearly  than  any- 
thing else  that  many  diseases  make  disastrous  headway 
more  because  of  belated  interest  and  tardiness  of  action  on 
the  part  of  Health  Officers  than  from  any  lack  of  knowledge 
of  what  to  do  in  the  face  of  danger  fully  realized. 

Let  us  therefore  be  more  alert  to  sound  alarms. 

Let  us  furnish,  as  we  can  very  easily,  the  advance  infor- 
mation on  which  intelligent  action  may  be  taken  to  prevent 
the  ravages  of  those  preventable  diseases  which  are  shorten- 
ing !0  much  the  span  of  human  life. 

Let  us  give  earnest  and  -  stimulative  support  to  the 
agencies  that  are  wcrking  to  stamp  out  these  unnecessary 
and  inexcusable  causes  of  death. 

Let  us  thus  help  toward  improving  average  longevity 
and  thereby  gain  for  our  policyholders  not  only  a  correspond- 
ing reduction  in  the  cost  of  their  life  insurance,  but  also 
what  they  want  most — additional  years  of  life  and  happiness 
on  this  earth. 


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YEAR 


RETURNED   SOUBIERS'   INSURANCE  BUSINESS 

Mortality  Rate  Has  Been  High,  And  Lapse  Rate  Low — 
Figures  Up  To  December  15,  1921. 

WITH  the  approach  of  the  close  of  the  period  during 
which  applications  may  be  received,  viz,  September 
1st,  1922,  the  number  of  applications  being  made  for  in- 
surance under  the  Returned  Soldiers'  Insurance  Act  is 
steadily  increasing.  More  than  200  ex-members  of  the 
forces  are  insuring  each  week  and  it  is  anticipated  that  at 
least  15,000  policies  will  have  been  issued  before  the 
period  expires. 

As  was  expected,  the  mortality  rate  has  been  very  high 
up  to  the  present  time.  The  majority  of  claims  admitted 
have  been  on  the  lives  ot  ex-soldiers  suffering  from  tub- 
erculosis, a  great  many  of  the  patients  in  the  various  Sana- 
toria throughout  the  country  having  taken  advantage  of 
the  insurance  provided.  It  is  expected  that  the  mortality 
rate  will  show  a  decided  improvement  after  the  first  few 
years  since  the  majority  of  present  policy-holders  are  be- 
lieved to  be  standard  risks. 

The  lapse  rate  has  been  very  low  in  comparison  with 
the  experience  of  the  companies,  due  no  doubt  to  the  fact 
that  n  o  business  is  written  under  pressure.  The  Govern- 
ment has  no  agents  for  Soldiers'  Insurance,  those  desiring 
to  insure  being  required  to  take  the  initiative  in  obtaining 
a  policy. 

liatest  Statistics 

Following  are  statistics  showing  the  amount  of  insur- 


Fire  Insurance  Premiums  and  Losses 


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£0 


ID 

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YEAR 


an»e  in   force,  number  ot  applications  received,   etc.   up   to 
December  15th: 

Approved   applications    received    7651 

Insurance    Value     ^$17,966,500. 

Death    Claims    Settled    94 

Death   Benefits  Paid    $32,900. 

Payable    in    Annuities     $201,250. 

Claims   pending  settlement    70 

Premium  Income  to  date   $326,365. 


COMMERCIAL  LIFE 
CO'S.  ASSETS 


To  those  familiar  with  that  young  and  progressive 
western  assurance  company,  the  Commercial  Life,  of  Ed- 
monton, an  unfortunate  error  in  the  company's  advertise- 
ment on  page  171  of  this  issue  will  be  obvious. 

The  assets  of  the  company  are  $304  to  every  $100  oX. 
liabilities,  not  "$304  to  every  $1000  of  liabilities,"  as 
stated. 

The   Publishers, 
TBE  MONETARY  TIMEB. 


January  6,  1928.  THE      MONETARY      TIMES  v::, 

UllMMIIIIMIMUIIIMIIIIIIIMMMMiriMIIIIIIIIIIIIIIIIIIIIIIUriMMMMMMIIIiri  IIIMIIIIIIIinilllllllllllllllllllllllllirillllllllllliltlllllllllllllMllllllltlllllt:' 


Guard  the  Chief 

Asset 


Many  concerns  are  built  round  a  man  whose  experience,  technical  knowledge, 
efficiency,  or  capital  make  him  one  of  the  most  valuable  assets  of  the  organiza- 
tion. 

Many  business  enterprises  have  been  wrecked  by  the  unexpected  loss  of  the 
services,  of  an  able  official  or  expert  employee,  or  by  the  sudden  withdrawal 
of  capital. 

In  such  cases  it  is  wise  to  make  provision  against  an  untoward  happening  by 
taking  advantage  T)f  BUSINESS  ASSURANCE. 

I II  some  cases  it  is  only  necessary  to  assure  the  life  of  the  higher  officers.     In 
others  it  may  be  expedient  to  astiure   a  number  of  valuable  employees.       In- 
numerable instances  exist  which  prove  that  such  policies  have  adequately  ful- 
filled their  purpose. 

BUSINESS  ASSURANCE  has  many  other  uses.  For  example,  the  aug- 
mentation of  capital  which  it  provides  gives  strength  to  an  organization  by 
improving  its  credit,  extending  its  borrowing  capacity,  and  supplying  funds 
which  can  be  used  to  extend  the  business. 

If  you  will  communicate  with  us  about  your  special  circumstances  we  will  give 
them  our  most  thoughtful  consideration. 


Sun  Life  Assurance  Company 

of  Canada 

Head   Office  -  -  MONTREAL 

Branches  in  all  Leading  Centres  in  the  Dominion 


rilllinilllllllllllllllllilllllllllllllllMlllllllllllllllllillllllllllllMltlllllllllllllllllllllllllllllllllllllllllllllllllllllMIIIIIIIIIIIIIIIIMIIIIIIIIIIIIIIIIIIII 


166 


THE      MONETARY      TIMES 


Volume  68. 


IMMIGRATION  BAN   HAS  BEEN   UNSATISFACTORY 


Restrictions  Imposed  By  Dominion  Government  Have   Not 
Been  in  Best  Interests  of  Country 


BY  E.  L.  CHICANOT 


A  REVIEW  ot  Canadian  immigration  covering  tlie  year 
1921,  regraded  from  any  or  all  of  the  standpoints  of 
a  young  Dominion  concerned  with  as  speedily  building  itg 
population  up  is  consistent  with  healthy  and  sound  growth, 
cannot,  unfortunately,  be  made  with  any  degree  of  satis- 
faction in  spite  of  the  fact  that  at  the  beginning  of  the 
year  Canada  faced  what  were  possibly  the  rosiest  pros- 
pects in  this  regpect  she  ever  experienced.  Not 
only  has  the  Dominion  failed  to  talte  advantage 
of  the  unusual  opportunities  which  presented  them- 
selves ,  but  by  legislation,  which  subsequent  events 
have  judged  to  be  ill  jadvised,  |and  |a  |policy  |of  discour- 
agement, has  even  lost  its  usual  quota  of  desirable  citizens 
and  seen  them  diverted  into  other  channels  whilst  it  has 
practically  connived  at  maintaining  an  open  door  for  those 
classes  of  immigrants  generally  considered  not  so  desirable, 
whose  entrants  have  increased  substantially.  Tl.ere  is  now 
an  even  more  deleterious  feature  in  the  danger  that  immigra- 
tion to  Canada  from  the  British  Isles  may  be  effected  for  the 
future  as  a  result  of  the  injurious  impres.sion  the  discontinu- 
ance of  advertising  and  propaganda  must  have  created. 
Immigration  cannot  be  turned  off  and  on  like  a  tap  and  once 
a  wave  of  uncertainty  and  doubt  as  to  a  country's  stability 
and  desirability  sweeps  over  a  people  it  is  impossible  to  tell 
when  or  where  its  effects  will  cease,  and  a  matter  of  years 
to  effect  a  readjustment. 

Immigratio.-i  Ban 

For  the  winter  season  of  1920-21  an  immigration  ban 
was  instituted  in  the  shape  of  a  requirement  that  incoming 
settlers  of  classes  other  than  the  agricultural  laborer  and  the 
domestic  servant  be  possessed  of  $250  in  addition  to  their 
passage  Troney,  the  government  having  regard,  presumably, 
to  the  disturbed  economic  conditions  of  the  Dominion  at  that 
time  and  the  volume  of  unemployment  existing.  There  was 
no  pronounced  disagreement  with  this  piece  of  legislation. 
Canada  is  unfortunately  situated  with  regard  to  vsdnter 
employment  conditions  f.nd  it  is  generally  conceded  that  no 
large  volume  of  immigration  be  encouraged  during  the 
.  winter  months. 

.  In  many  quarters,  however,  it  came  as  a  totally  unex- 
pected blow  when  it  was  announced  that  the  ban  would  not  be 
lifted  on  May  1st  a.s  anticipated  but  continue  in  effect 
throughout  the  summer  m.onths.  The  reason  given  was  the 
continued  state  of  uneraployment  throughout  Canada  though 
there  is  every  reason  to  believe  that  this  step  was  due  to 
pressure  brought  to  bear  upon  the  government  by  labor 
interests  actuated  by  a  fear  thai  inflated  wages  would  be 
lowered  by  an  influx  of  wcrlcmen  of  any  proportio*.  The 
effects  of  this  ptep  were  naturally  immediate  and  far  reach- 
ing, and  Ferious  from  the  national  standpoint.  Thousands  of 
persons  in  the  British  Isles  who  had  been  awaiting  the 
arrival  of  May  Ist  and  the  removal  of  the  ban  were  forced 
to  throw  up  their  passages  after  having  made  all  arrange- 
ments to  .sail  during  the  summer  months.  Immigration 
returns  dropped  immediately.  After  showing  steady  increases 
every  month  since  the  termination  of  the  war  the  month  of 
May.  the  first  in  which  the  continuance  of  the  ban  wa«  felt, 
showed  a  decline  and  this  has  continued  in  every  subsequent 
month  of  the  year  for  which  statistics  are  so  far  available. 

Fewer  Immigrants 

The  month  of  May  recorded  a  decrease  of  twenty-eight 
per  cent,  over  the  corresponding  month  in  the  previous  year. 
The  declines  are  noted  in  the  entrance  of  immigrants  from 
the  British  Isles  and  United  States.  There  was  a  heavy 
increase  in  the  entrants  from  "Other  Countries".  June's 
decline  was  twenty-five  per  cent.,  the  decreases  being  in  the 
same  directions.  July's  decrease  was  forty  nine  per  cent, 
over  July  1920,  British  Immigration  falling  off  by  two-thirds, 
and  that  from  the  United  States  by  one-half,  whilst  the  influx 
from  the  other  countries  doubled.  In  August  and  September 
there  were  decreases    of    forty-six    per  cent,    and  forty-four 


per  cent,  le  pcctively.  The  record  of  decline  over  the  six 
months  of  the  fiscal  year  as  compared  with  1920  is  thirty-one 
per  cent. 

This  increase  from  "Other  Countries"  tells  its  own  tale. 
Asa  people  we  are  constantly  reiterating  that  our  best  immi- 
grants are  those  from  the  British  Isles  and  the  United 
States;  our  politicians  preach  it  and  it  is  driven  home  from 
the  editorial  columns  of  our  press.  Yet  these  "very  people  are 
to  a  large  extent  being  excluded  to  make  way  for  "other 
countries"  which  include  the  nations  of  Northern  Europe, 
Czecko-Slavia,  and  others  whose  people,  unknowing  our 
tongue,  with  a  lower  standard  of  living,  a  greater  degree  of 
illiteracy,  and  no  great  possession  of  those  qualities  which 
make  for  quick  assimilation  are  certainly  very  much  less 
desirable  for  Canadian  citizenship  than  the  classes  excluded. 
Many    Undesirables 

The  effect  of  this  kind  of  immigration  on  Canada  as  a 
nation  struggling  for  healthy  growth,  on  Canadian  institu- 
tions, and  the  general  public  may  be  summed  up  in  a  single 
month's  record  of  one  Canadian  steamship  company.  In  the 
month  of  September  twelve  vessels  arrived  at  St.  Lawrence 
ports  carrying  9,319  passengers  from  Europe  of  whom  3,600 
were  new  Canadian  colonists  and  529  bound  for  the  United 
States.  Out  of  these  new  Canadians  arriving  there  were  505 
detentions  on  various  grounds  which  resulted  in  the  deporta- 
tion of  68  of  their  number.  It  need  hardly  be  suggested  that 
the  remainder  of  the  505  who  were  admitted  to  Dominion 
citizenship  will  not  make  the  most  desirable  type  of  citizens 
the  country  would  like.  In  the  first  nine  months  of  the  year 
the  average  number  of  passengers  carried  per  vessel  by  this 
same  steamship  Company  wf.s  911.71  in  which  the  average 
number  of  detentions  per  vessel  was  42.08  and  the  number 
of  per  ons  antu-rv  d  ported  5.66.  As  the  steamship  com- 
panies in  these  cases  are  fined  $200  by  the  government  for 
each  deportee  an*  have  in  addition  to  transport  him  free  on 
the  return  trip  as  well  as  return  the  passage  money  of  the 
trip  out  it  can  readily  be  seen  that  the  loss  to  these  companies 
runs  some  months  into  tens  of  thousands  of  dollars.  It  is 
little  wonder  that  Canadian  stL-amship  companies,  out  of 
patience  with  the  absurdities  of  government  systems^  of 
inspection,  have  established  their  own  doctors  and  medical 
examinations  at  the  ports  of  debarcation. 

It  has  not  been  that  other  classes  of  immigrants  have 
not  been  available.  Overseas  a  more  desirable  type  of  people 
than  ever  favored  Canada  previously  have  had  their  eyes 
turned  upon  the  new  fields  and  new  opportunities  the  Domin- 
ion offers.  -There  is  a  new  poor  in  England,  the  war  hit 
hardest  those  of  smalt  independant  incomes  and  salaries.  It 
is  the  desirable  middle  class,  the  backbone  of  English 
economic  li^'e.  that  the  new  heavy  taxation  falls  with  greatest 
weicht  upon.  Cpnada  looms  up  before  their  vision  an  oasis 
in  the  desert  of  eeonomio  depression  and  hopeless  prospect. 
There  is  not  the  sn^allest  doubt  but  that  there  are  thousands 
of  this  class  desirous  of  emigrating,  Snd  it  is  just  as  sure 
that  no  country  could  desire  better  citizen  material. 
Advertising     Has     Ceased 

Canada  has  ceased  to  advertise  among  them.  They  are 
virtually  discouraged.  Why  ?  We  are  wont  to  boast  that  we 
have  come  out  of  the  v-ar  period  in  a  better  position  than 
most  countries,  yet  Australia,  South  Africa,  and  New  Zea- 
land, who  -till  have  to  borrow  money  from  the  Motherland 
whereas  Canada  was  able  to  advance  England  sums  during 
the  war,  realize  that  the  solution  to  their  problems,  which 
are  ours  and  P-ore  acute,  lies  in  securing  desirable  immigra- 
tion ?nd  settPng  their  vacant  tracts.  They  are  inducing  it 
by  cveiv  ro  iible  m-^'ans  even  to  paying  steamship  and  rail- 
road fares    to  immigrants.       Whilst  Canada  is  discouraging 

Britis'-    ! 'Tation    Australia    has  a  slogan  of    "A  million 

face  of  the  fact  that  all  previous  indications  proved  conclus- 
ively that  Canada  was  in  every  respect  the  favorite  among 
the  British  Domin'ons. 

One  is  forced  to  conclude  that  the  money  restriction  was 
not  an  advisable  piece  of  policy  as  not  affecting  the  end  for 
wh'ch  it  was  established.  Those  in  closest  touch  with 
immigration  affairs  are  almost  unanimous  on  the  subject. 
The  fact  that  a  man  is  possessed  of  $250  is  no  proof  of 
desirability  of  citizenship.  In  many  instances  it  proves  the 
reverse.  The  class  of  people  from  the  British  Isles  whom  - 
British    farmers    for    a    million     British    farms."      Lord 


January   6,   1922.  THBMONBTARYTIMBS  1«7 


Continued    Progress 

coupled  with  intelligent  co-oper- 
ation, makes  a  connection  with 

The  Western  Life 

Assurance  Company 
A     PARTICULARLY     PROFITABLE     ONE 

For  details  of  openings    in  unrepresented  districts 

address — 

Adam  Reid,  „,.      .  Head  office: 

Managing  Director  Winnipeg,  ManitODa 


|iiiiiiiiiiiiiiiiiiiiuiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiin  iiiiiii I iiiiiiiiiiiiiiiiiiiiiiiiiiiii iiiiiiiii iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii 


m 


It's  Too    l^^te^'-'Afterwards! 

In  placing  your  insurance,  make  sure  that  the  com- 
panies you  select  are  sound.  Caution  in  a  matter  of 
this  kind  distinguishes  the  good  business  man.  The 
companies  listed  on  page  four  of  this  publication  are 
all  safe  to  insure  with. 

Every  form  of  policy  written  in  Canada,  containing 
every  worth-while  advantage  and  privilege  to  the 
insured,  is  offered  by  the  advertisers  in  the 
Insurance  section  of 

The    Monetary    Times    Annual 

1867  As  Old  as  the  Domininion  of  Canada  1922 


«idiiiiiiiiiiiiiiiiiiiuiniiiMHiiiiiiiiuiHiiiiira^^^^^^^^^^ 


168 


THE      MONETARY      TIMES 


Volume  68. 


Northcliffe  on  his  visit  to  Canada  pointed  out  to  Canadian 
legislators  that  Canada's  quota  v/as  being  diverted  and  in 
Canada  vi^ould  like  to  cee  come  over  to  build  up  her  domain 
have  a  high  standard  of  living,  a  higher  one  than  probably 
exists  on  any  other  part  of  the  European  continent.  To 
achieve  this  they  are  accustomed  to  live  pretty  much  up  to 
of  sufficient  money  to  defray  passage  expenses  is  not  the 
easiest  of  tasks.  On  the  other  hand  large  numbers  of  contin- 
entals who  are  finding  their  way  to  Canada  have  a  living 
■standard  very  much  lower.  They  accumulate  savings  at  the 
expense  of  their  methods  of  living,  social,  sanitary,  and 
moral.  Their  saving  habit  is  not  of  the  kind  that  is  a  benefit 
to  the  nation  they  belong  to  being  as  a  rule  a  purely  selfish 
hoarding.  Yet  this  stocking  account  gives  them  entry  into 
Canada  over  British  &tock  whose  money  is  in  continual 
circulation,  there  to  continue  the  same  selfish  piling  up  of 
wealth  which,  too  often,  is  to  be  taken  away  at  some  later 
the  limit  of  their  salaries  and  incomes,  and  the  accumulation 
dFte  to  their  native  country. 

Restrictions  are  Overcome 

Furthermore,  it  is  a  well  known  fact  that  this  ban  is 
overcome  by  foreign  organizations  in  this  country  which 
assist  the  entry  of  fellow  countrymen  by  furnishing  the 
requisite  an-ount  of  money  for  entry,  which  may,  in  this  way 
be  used  over  and  over  again.  There  is  not  the  slightest  doubt 
but  that  this  is  being  done  and  the  government  regulations 
set  at  nought  for  the  introduction  of  continentals  whilst  the 
British  Immigrant  has  no  such  organization  and  for  the  main 
part  would  scorn  to  resLort  to  such  subterfuge  to  secure  entry 
to  one  of  the  Dominions  of  his  own  Empire. 

At  the  very  time  when  Canada  is  discouraging  immigra- 
tion and  when  the  numbers  of  those  brave  enough  to  enter 
the  country  show  great  declines  from  the  number  the 
Dominion  was  accustomed  to  welcome  before  the  war  and  in 
the  immediate  post-war  period  Canada  has  perhaps  more 
pressing  need  for  immigrants  and  the  salutary  effects  of  an 
additional  population  than  she  ever  had  before.  We  are 
accustomed  to  comparing  the  status  of  the  Dominion  with 
that  of  the  United  States  a  hundred  years  ago.  But  we  can 
only  achieve  a  grovrth  similar  to  that  of  the  Great  Republic 
through  a  healthy  flov/  of  immigration.  More  than  thirty- 
four  million  immigrants  entered  the  United  States  in  the 
past  century  and  in  the  same  time  the  population  of  the 
country  increased  by  ninety-seven  million.  This  is  tantamount 
to  saying  that  of  every  three  people  in  the  Republic  to  the 
south  of  us  one  was  an  immigrant.  What  more  pressing  need 
is  there  for  immigration  than  the  government  railway 
problem,  the  vast  stretches  of  untilled  agricultural  land,  the 
natural  resources  v/hich  await  industrial  capital  for  exploita- 
tion, and  our  huge  national  debt. 

Importance  to  Railways 

Whilst  active  forces  in  parliament  have  energetically 
worked  for  an  immigration  ban  and  partially  achieved  their 
object  the  government  railways  have  been  piling  up  deficits 
at  the  rate  of  about  one  hundred  millions  per  year,  with 
railway  experts  stating  in  no  unmistakable  terms  that  the 
only  salvation  of  these  lines  lies  in  the  persuit  of  an 
aggressive  immigration  policy.  "It  was  an  aggressive 
immigration  policy  which  built  up  the  Canadian  Pacific" 
said  Mr.  Beatty,  present  president  of  that  road,  "and  without 
immigration  the  prospects  of  the  Canadian  National  are  in 
my  opinion  hopeless." 

Railway  lines  to  pay  dividends  must  have  tributary 
revenue  through  the  settlement,  agricultural  and  industrial 
of  the  lands  about  them.  The  influx  of  settlers  means 
passenger  traffic  ;  production  ensures  constant  freight 
service  ;  denser  settlement  and  greater  production  elevate 
land  prices  and  bring  in  their  wake  industrial  settlement. 
Industry  cannot  prosper  until  there  is  a  contributory  popula- 
tion to  supply  the  labor  and  the  markets  necessary  and 
manufacturers  are  not  going  to  introduce  capital  into 
unsettled  areas.  With  such  a  length  of  the  government  lines 
running  through  territor),'-  that  is  unsettled  and  unproductive 
it  is  auite  obvious  that  these  areas  cannot  be  made  to  pay 
until  there  are  people  dwelliner  on  them,  and  they  never  will 
be  settled  until  the  right  kind  of  people  is  made  available  for 
immieration. 

Expert  railway  statisticians,  taking  into  account  every 
pertinent   factor,    and    after    exhaustive  calculations,    have 


estimated  that  each  new  settler  in  Canada  is  worth  the  sum 
of  $746.33  to  the  railroads  of  the  Dominion  in  his  lifetime. 
This  applies  to  any  line  to  which  he  may  become  a  contribu- 
ting member,  and  here  we  have  in  concrete  fig:ures  just  what 
settlers  would  mean  in  solving  the  government  lines  problem 
and  just  how  many  exactly  are  necessary  to  wipe  out  the 
huge  annual  deficit 

Much  Land  Available 

In  the  four  Western  provinces  of  Canada  there  are 
approximately  300,000,000  acres  of  fertile  arable  land  which 
have  never  yet  known  the  plough.  Manitoba  has  only  six 
people  to  the  square  mile  ;  Saskatchewan  two  ;  Alberta  less 
than  two  ;  and  British  Columbia  barely  one.  What  other 
solution  is  there  for  rendering  productive  this  huge  area  but 
immigrat;on,  the  introduction  of  settlers  of  the  type  which 
produced  a  Seager  Wheeler,  the  Hill  Brothers,  and  Herbert 
Greenfield. 

We  confidently  expect  that  the  fully  published  census 
returns  will  disclose  a  Dominion  population  of  nine  millions 
as  against  three  millions  at  the  time  of  Confederation.  What 
built  up  this  population  but  immigration  ?  And  what  would 
be  the  effect  if  the  census  returned  ten  million  instead  of 
nine — the  addition  of  a  million  people  which  Canada  could 
secure,  of  the  very  best  type,  from  the  British  Isles  without 
the  slightest  trouble.  Should  the  entire  million  go  on  the 
land  and  be  given  each  a  homestead  160,000,000  acres  would 
be  made  productive,  bringing  un'der  cultivation  more  than  one 
half  of  the  uncultivated  vasts,  and  multiplying  by  four  the 
West's  present  agriculturally  producing  area.  Canada  has 
a  national  debt  of  2,349  millions  which  is  being  paid  off  by 
about  nine  million  people.  The  per  capita  debt  is  approx- 
imately $261.  Add  a  millior  to  the  Dominion's  population 
and  it  automatically  drops  to  $235.  The  value  of  a  settler  to 
Canadian  railroads  is  ^46.33.  Settle  one  million  more  people 
in  Canr.da  and  their  contributory  revenue  is  in  excess  of 
$746,000,000  wiping  out  the  government  railway  deficit  for 
all  time. 

The  ban  on  Canadian  immigration  has  been  carried  to 
lengths  undrermed  of  by  the  Canadian  people  and  only  the 
despatches  of  the  British  correspondents  of  Canadian  papers 
give  an  inkling  of  what  is  going  on  across  the  water.  To 
quote  from  a  recent  despatch  from  a  reliable  correspondent: 
"The  rigid  discouragement  of  even  experienced  unmarried 
farm  workers  is  being  continued  by  the  Canadian  immigra- 
tion authorities."  The  actively  working  mind  of  Lord 
Northcliffe  grasped  in  a  brief  time  the  defects  of  our  immi- 
gration system  aiid  he  went  the  length  of  pointing  out  to 
Canada  th£,t  she  was  losing  out  heavily  at  the  present  time 
to  Australia  and  other  Dominions  and  was  liable  to  suffer 
further  in  the  future  from  the  loss  of  her  prestige  as  a 
country  for  British  immigration,  a  reputation  not  easily  built 
up  but  gone  in  a  moment.  He  points  out  too  the  absurdity 
and  waste  of  the  drastic  medical  examination  which  turns  so 
many  Britishers  back  at  the  very  doors  of  Canada  after  they 
have  been  passed  by  the  medical  officers  on  the  other  side  and 
suggests,  what  is  apparent  to  everybody,  that  the  final 
examination  should  be  in  the  British  Isles  and  emigrants 
spared  this  loss  of  time  and  money,  and  the  ignomy  of  rejec- 
tion. Some  particularly  glaring  and  heinous  blunders  on  the 
part  of  Canada's  immigration  authorities,  following  out 
decrees  which  they  cannot  deviate  from,  have  filled  long 
columns  in  British  press  and  given  Cc.nada  the  worst  kind 
of  publicity  possible. 

Present,  Situation  Unsatisfactory 

The  Canadian  public  as  a  whole  has  not  been  in  the 
habit  of  regarding  immigration  matters  very  seriously  or  had 
a  very  keen  realization  of  the  effect  upon  the  development  of 
our  country  the  trend  of  the  flow  to  our  shores  has.  But  the 
declining  months  of  li721  witnessed  a  widespread  interest 
which  evidenced  itself  in  many  ways.  Defects  and  blunders  - 
glarinnrlv  revealed  a  basic  unsoundness  in  Canadian  immigra- 
tion policies  and  systems  out  of  which  arose  a  wholesale 
publication  of  editorials  on  the  subject  as  well  as  numerous 
letters.  Indignation  meetings  have  been  held  in  places  to 
protest  some  particularly  ignominious  detention  or  deport- 
ation resulting  in  a  clear  travesty  of  justice.  There  is  swept 
over  the  Canadian  people  a  conviction  that  the  whole  system 
of  examination  on  entry  is  faulty  and  the  logical  means  of 
deciding  who  shall  be  the  future  Canadians   reversed.      No 


January   6,   1922. 


THE      MONETARY      TIMES 


169 


THE 


Western  Empire 

Life  Assurance  Company 


WINNIPEG 


MANITOBA 


RESULTS   FOR   1921   SHOW— 

Increase  in  Business  Written.  Increase  in  Business  Issued. 

Increase  in  Premiunns  Collected.  Increase  in  Interest  Collected. 

Increase  in  Assets. 

IN    SHORT-A    YEAR    OF    SUBSTANTIAL    PROGRESS 

1  here    are   a    number    of   good    districts    available    for    men    who    can 

produce    good    business 


WM.  SMITH, 

President  and  Managing  Director 


F.  C.  O'BRIEN, 

Secretary-Treasurer 


'^iiiinriiiinmiiuiiiwriniiiiiiiiiiiiiiiiiiiiiiiiiiiuHiiiiiiiiiiiiiiiiiiiiiiiiiiiiiinniniuiiiniiiimiiiiiiiiiiiiiiiiiijiiiiiiMniuw^^^^ 

I  THE 

I  Portage  La  Prairie 

Farmers  Mutual 

I  Fire  Insurance  Co. 

I  Head  Office,  Portage  La  Prairie,  Man. 

I  Organized   1884 

I  INSURANCE  IN  FORCE : 

I        December  31st,  1889 $      832,145.00 

5:        December  31st,  1895 1,632,666.00 

I        December  31st,  1900 4,408,061.00 

I        December  31st,  1905 11.806,165.00 

I        December  31st,  1910    20.350,581.00 

B        Dicember  31st,  1915 30,288,709.00 

I        December  31st.  1920 63,153,907.00 

I       November  30th,  1921 68,500,000.00 


I iiiiiiu]iiiimiiiiwiiii.s 


1^       We  have  pa'd  the   f  armera   of  Manitoba 
I  over  $1,250,000  for  Io«a  claims 

I        This  Company    insures    in    the 
Province  of  Manitoba  Only 

Z  PllESlOENT,   E.  H.  MUIR. 

3  Treasuw.k,  a.  H.  THORPE 

Skc'y.-Mgr.   STRATTON   WHITAKER. 

.-MiiiimisiuiiiiuiiiiiuiHiimiinmiiiiuiiiiiiiiiiiiiiiuiiiiiiiii: 


The  Miniota 

Farmers'  Mutual 

Fire  Insurance  Co. 

Head  Office  -         Beulah,  Man. 

J.  A.  FRAZER,  President. 
G.  ROWAN,  ViCT>PBEsn>EST 
H.  E.   HEMMONS.  Man.vuer. 

Licensed  in  Manitoba  and  Saskatchewan 
Insurance  in  Force  -  Over  $45,000,000.00 
Assets  Dec.  21st  1920       -      $731,906.32 

L.osses  paid  to  the  Farmers  of  Western 

Canada  to  date,  over   i-lalf  a  Million 

Dollars 

Lowest  Assessment  Rate  of  any  Motuat  Company 

For  further  information  apply  to — 
I  The  Secretary. 

BKUtAH,  Makii.  ; 


THE  WESTERN  CANADA  MUTUAL 
riRE  INSURANCE    ASSOCIATION 

MEMBER 


170 


THE      MONETARY      TI  M.E  S 


Volume  68. 


clearer  condemnation  of  our  system  could  be  found  than  that 
public  spirited  citizens  have  found  it  necessary  to  band  them- 
selvee  together  and  seek  Federal  incorporation  for  the 
purpose  of  assisting  desirable  British  immigration,  a  work 
which  should  be  that  of  the  country. 

With  the  anxiety  of  the  Dominion's  future  at  heart  one 
cannot  regard  1921  rs  anything  else  but  a  disappointment 
from  the  standpoint  of  immigration.  We  still  have  the  eyes 
of  thousands  of  sturdy,   intelligent  Britishers   cast  upon  the 


Dominion  waiting  for  an  invitation  if  not  a  welcome.  The 
Deputy  Minister  of  Immigration  and  Colonization  has  visited 
the  Britii-h  Isles  and  things  are  indefinitely  promised  which 
ia  not  a  logical  sequel  to  a  policy  of  discouragement.  Perhaps 
however  n  1922  it  vidll  he  fov.nd  pos.sible  for  the  Dominion 
to  accomodate  more  of  these  peoples  and  sacrifice  some  of  the 
steamer  space  devoted  to  less  desirable  entrants.  To  drive 
them  elsewhere  is  the  Dominion's  loss,  and  future  hopes  we 
base  on  past  achievements  may  be  cast  to  the  winds. 


Growth  of  Burglary  Insurance  Has  Been  Rapid 

Practically  Unknown  in  Canada  Before  the  War,  It 
Has  Expanded  Rapidly  Because  of  Excessive  Crime 
Wave  and  Increase  in  Amount  of  Valuables  Held 


BURGLARY,  of  course,  means  forcibly  breaking  into 
a  building  for  the  purpose  of  stealing  property 
therein,  and  differs  widely  from  theft  by  household  ser- 
vants or  by  outside/s  entering  through  open  windows  or 
doors,  without  the  use  of  force.  Protection  by  insurance 
from  both  may  be  secured,  but  if  loss  through  theft  is 
included  in  the  policy,  the  rate  will  be  somewhat  higher 
than  for  burglary  alone.  Policies  are  written  to  cover 
not  only  burglary  and  theft  from  private  residences,  but 
from  stores,  banks,  offices,  business  buildings,  hold-ups 
of  paymasters,  messengers,  etc.  These  policies  vary  widely 
in  form  and  construction  to  meet  all  special  requirements. 

Losses  are  reported  to  have  been  extremely  high  last 
year,  thus  nullifying  much  of  the  profit  accruing  from  the 
increased  amount  of  business,  which,  in  the  case  of  some 
companies,  ran  up  to  30  and  40  per  cent.  There  is  already 
a  co-insurance  clause  in  the  Opep  Stock  Insurance  Policy, 
and  the  companies  contemplating  inserting  it  also  in  the 
Residence  Policies,  for  such  articles  as  gold  and  sterling 
silver,  jewellery,  and  those  wholly  or  partly  made  of  fur. 
A  New  Development 

Although  policies  were  written  in  a  desultory  manner 
as  far  back  as  twenty-eight  years  ago,  the  business  of 
Burglary  Insurance  Underwriting  in  Canada  (except  with 
the  larger  banks,  who  carried  policies  with  Lloyds  of 
England,  chiefly),  was  practically  unknown  before  the 
Great  War.  In  England  and  the  United  States,  of  course, 
.  this  class  of  insurance  has  for  very  many  years  been  as 
common  as  that  of  fire  or  other  kinds  of  insurance,  but 
obviously  in  this  comparatively  new  country,  it  is  yet  in 
its  infancy,  and  has  to  some  extent,  perhaps,  been  tenta- 
tive in  Its  methods  and  regulations,  terms  and  rates,  etc. 
But  since  the  war,  the  great  number  of  hold-ups,  burg- 
laries and  daylight  robberies,  especially  in  banks,  all  over 
the  Dominion,  has  given  rise  to  a  steady  Increase  In  the 
demand,  from  the  business  community  particularly,  for 
burglary  insurance.  And  in  1920  we  find  that  22  com- 
panies in  Canada  were  issuing  burglary  policies — 9  Can- 
adian companies,  6  British  and  7  foreign;  the  premium 
for  amounts  written  last  year  totalled  about  $488,000—- 
an  increase  over  the  amount  for  1919  of  about  |160,000. 
but  wbile  the  losses  in  1919  were  only  $116,000,  for  last 
year  they  footed  up  $244,166,  or  nearly  sixty  per  cent. 
The  net  amount  of  premiums  earned  in  1920  was  only 
about  $400,000  in  policies,  but  when  compared  with  1902, 
when  the  premium  income  amounted  to  $18,000  on  1,654 
policies  Issued,  the  total  for  last  year  does  not  seem  so 
small.  Owing,  doubtless,  to  their  heavier  losses,  experi- 
enced for  many  years,  the  United  States  companies  repre- 
sented in  Canada  had  been  urging  the  Burglary  Under- 
writers' Association  of  Canada  to  increare  its  rates,  but 
the  Canadian  companies  timidly  held  back,  lest  they  might 
be  thought  to  be  prohibitive.  However,  after  last  year's 
experience,  the  members  of  the  Association  met  in  June 
last  to  readjust  matters  and  if  possible  establish  the  rates 
upon  a  more  scientific  basis.  A  certain  advance  wa? 
agreed  upon,  but  before  it  could  be  put  Into  effect,   one 


company  at  least  objected  to  the  method  of  carrying  It 
out,  and  thus  the  advance  became  ineffective.  The  ques- 
tion was  held  in  abeyance  until  the  Fall  of  this  year,  when 
at  another  more  rajiresentative  meeting  of  the  companies 
held  at  the  end  of  September  last,  it  was  decided  to  adopt 
the  divided  coverage  policy,  in  residence  burglary  forms, 
grouping  jewellery,  silverware,  furs,  plumbing,  light  and 
water  fixtures,  etc.,  under  one  item,  and  exclude  liquors, 
which  may  be  insured  as  a  specific  article,  at  the  rate  of 
$5  per  $100  for  burglary,  and  $7.50  for  burglary,  theft 
and  larceny, — corresponding  to  the  rates  charged  for 
liquors  in  the  United  States. 

An   Increase   in   Crime 

As  is  well  known,  the  private  house  burglaries  have 
been  much  more  numerous  in  Canada  during  the  last 
eighteen  months  than  ever  before;  liquor  vaults  and 
cellars  receiving  special  attention  from  the  uninvited 
visitors,  especially  during  the  dry  periods, — but  It  is 
noticable  that  since  the  Orders-in-Council  were  revoked 
there  have  not  been  so  many  liquor-steals.  The  safe- 
guards against  burglaries  are  steadily  being  increased  and 
improved,  but  it  is  noteworthy  that  the  methods  of  pro- 
fessional burglars  for  overcoming  and  frustrating  these 
safeguards  have  also  been  improved  and  added  to.  By  the 
skilful  use  of  the  asceteline  torch  the  experienced  burgalr 
can  get  through  the  strongest  vault  made,  so  long  as  he 
is  not  too  quickly  interrupted  in  his  work.  This  and 
other  modern  devices  may  in  part  account  tor  the  much 
heavier  losses  and  smalled  underwriting  profits  of  Can- 
adian burglary  insurance  companies  during  the  last  two 
years.  Notwithstanding  the  prevalent  "wave  of  crime," 
it  is  not  generally  believed,  however,  that  many  old,  experi- 
enced professionals  have  yet  been  operating  in  Canada; 
the  high  reputation  of  our  police,  especially  of  the  North- 
west Mounted  Police,  and  the  speed  with  which  our 
criminal  laws  are  administered,  seem  to  command  more 
than  ordinary  respect  from  the  so-called  "brainy  experts'" 
of  the  United  States,  and  it  is  to  be  hoped  that  they  will 
continue  to  evince  their  good  taste  by  remaining  away. 
In  preparation  for  future  contingencies,  it  is  suggested 
by  some  underwriters  that  it  might  be  well  for  the  Gov- 
ernment to  provide  for  specially  trained  detachments  ot 
police  for  dealing  more  elTectively  with  these  gentry  than 
can  be  done  by  tht  ordinary  civic  and  municipal  or  the 
Provincial  police  forces,  as  at  present.  It  is  believed  that 
a  body  of  specially  equipped  officers,  giving  their  whole 
time  to  the  protection  of  lives  and  property,  as  in  spme 
countres,  would  prove  to  be  a  great  step  in  advance.  a 

New  Rates  of  Premionis  ■ 

At  the  meeting  ot  the  Burglary  Underwriters'  Asso- 
ciation, above  referred  to,  new  standard  rates  were  fixed 
and  agreed  to  by  all  present,  for  the  various  classes  of 
burglary,  theft  and  robbery  Insurance,  as  given  below. 
The  meeting  adopted  a  coinsurance  form  for  open  stock 
mercantile  burglary  cover.  The  Bank  Committee  of  tha 
Xssociation  reported  the  rates  dcided  upon  for  safe  deposit 


January  6,  1922. 


THE      MONETARY      TIMES 


171 


Incorporated  in  the  Reign  of  King  William  IV. 

A.D.  1833 

British   America  Assurance    Company 

FIRE,      AUTOMOBILE,      MARINE,      HAIL, 
RIOTS,  STRIKES  and  CIVIL  COMMOTIONS 


Assets  over 
Losses  paid  since  Org-anization  in  1833  over 


$4,000,000.00 


$50,000,000.00 


W.  B.   MEIKLE,  President  and 
General   Manager 

W.  M.  COX,  Vice-President 

SIR  JOHN  AIRD 

ROBT.  BICKERDIKE   (Montreal) 


DIRECTORS 

Le.-Col.  HENRY  BROCK 
ALFRED  COOPER  (London,  Eng.) 
H.  C.  COX 

JOHN  H.  FULTON  (New  York) 
D.  B.  HANNA 


MILLER  LASH 
GEO.  A.  MORROW 

Major-General 

SIR  HENRY  PELLATT,  C.V.O. 
E.  R.  WOOD 


London   Offices 


14  Cornhill,  London,  E.C. 

HEAD  OFFICES : 
British  America  Assurance  Buildings,  -  -         Corner  Scott  and  Front  Streets,  TORONTO 


E.  F.  GARROW, 

Assistant  General  Manager. 


C.  S.  WADTWRIGHT, 

Secretary. 


As  an  e%idenc»'  of  tlio  siniii(lncs.s  of  a  young 
<-onii)uny  conipIyinK  with  the  Dominion  Insurance 
.Art,  till"  Assets  of  Tho  ("onimerclal  liife  Assurance 
Coinpiiny  of  Canada  are 

$304.  TO  EVKRY  $1000.  OP  L/I.IUILITIES 

While  the  as-^t'is  of  all  other  Ciitmcllaii  Conipaiile.s  averairt'd 
are  ahniit  'liri.  to  every  ?I0()  of  llahlliltes. 

The  rale  (if  Uileresl  Bariied  on  the  mean  net  ledger 
assets  lit  Tho  cnnitiiereial  Mfc  Is  !).()7%.  This  Is  over 
ic;  greater  than  the  average  rale  of  atiy  other  life  com- 
laiiiy.  The  tiielhoil  of  riiiii|>iilliiK  this  average  i.s  prescrlbeiJ 
hy  the  l)e|iartiiieiu.  and  Is  iiniroriii  with  all  companies 
oiicrallnsf    under   a    linnilnlon    License. 


Head  Oflfice.  EDMONTON,  CANADA 


'iitiiiiiiiiinniiniiuiiiiiiniiiiiiiiiiiiiiiiiiiuMiiiijiiinoiniiiiniiiiiiiiniiiiim 


THE 


Saskatchewan  Farmers' 

Mutual  Fire  Insurance 

Company 


SASKATOON 


SASK. 


Saskatchewan's      Largest      and     Strongest 
Farmers'  Mutual  Fire  Insurance  Company 

BUSINESS  IN  FORCE- 


December  31st.  1908 
December  31st,  1912 
December   3 1st,  1915^ 
December  31st,  1918 
October  31st,  1921 


$1,157,903.00 

$8,566,274.00 

$117184,170.00 

$23,988,972.00 

$42  722.932.00 


Farm  Insurance  at  Actual  Cost 


JOHN  EVANS. 

Prksident. 


H.  R.  EARLE, 

VlCC-PRSSIDSXT. 


JOHN  CAMERON,  Sbcretart-Makaool 


172 


THE      MONETARY      TIMES 


Volume  68. 


boxes  for  individuals,  based  upon  a  description  of  the 
vault  instead  of  a  flat  rate  hitherto  charged.  A  standard 
form  of  policy  was  adopted  for  this  kind  of  insurance,  and 
policy  forms  and  rates  for  banks  and  trust  companies, 
covering  all  safe  boxes,  as  lessors,  and  a  third  form  cover- 
ing the  legal  liability  only  for  loss  of  contents  of  safe 
deposit  boxes,  was  adopted.  The  increase  of  rates  amounts 
to  about  33  1-3  per  cent,  on  the  average,  compared  with 
the  past  summer's  rates. 

On  Residence  Policies  the  rate  is  ?10  per  $1,000  under 
Section  A,  and  $5  per  $1,000  under  Section  B.  According 
to  Association  rules  it  is  optional  w.hether  you  take  A, 
but  you  must  take  it  under  B,  and  to  the  limit  of  50  per 
cent,  of  the  amount  of  fire  insurance  carried  on  your 
contents.  It  is  claimed  that  this  insures  even-handed 
justice  between  the  rich  and  poor — has  the  same  effect  as 
a  co-insurance  clause.  If  all  the  burglary  insurance  be 
taken  under  Section  B,  the  minimum  premium  rate  Is 
$10;  if  both  ^  and  B  are  taken,  the  minimum  premium 
rate  is   $15. 

Mercantile  Open  Stock 

Mercantile  Open  Stock  Policy  covers  all  classes  of 
manufacturers'  and  merchants'  goods,  only  during  hours 
when  their  business  places  are  closed, — purely  a  burglary 
policy.  AH  goods  usually  insured  under  this  policy  are 
classified  into  five  groups,  each  group  carrying  a  different 
premium  based  on  the  hazard  assumed,  and  varying  from 
$18  to  $48  for  the  first  $1,000  insurance.  The  rates  on 
additional  thousands  show  a  considerable  decrease,  on  a 
sliding  scale. 

Safe  Insurance. — In  Ontario  the  premium  rates  vary 
according  to  the  population  of  the  city  or  town.  In  Toronto 
the  rate  is  $11  per  $1,000  on  monies  and  securities,  and 
$8.80  per   $1,000  on  merchandise. 

Hold-Up  Insurance  is  divided  into  three  sections. 
"Pay-Roll"  is  sold  at  $7.50  per  $1,000,  covering  the  time 
when  money  is  drawn  from  the  bank  until  in  envelopes 
it  is  paid  to  the  employees.  "Exterior — Not  Exclusively 
Pay-Roll,"  is  issued  at  $7.50  per  $1,000,  covering  the 
messenger  while  outside  of  the  office  premises.  "Interior 
Hold-Up"  insurance  may  be  had  at  $5  per  $1,000  it  only 
one  person  is  on  duty.  It  more  than  one  on  duty,  $4  per 
$1,000.  Drug  stores  and  gasolene  stations  constitute  the 
only  exceptions,  the  premium  rate  tor  these  being  $10  per 
thousand. 

Business  is  reported  fairly  good  at  present,  with  losses 
proportionately  increasing;  but,  as  above  stated,  the 
enterprise  in  Canada  is  in  the  early  stages  of  development, 
and  there  are  bound  to  be  fluctuations  In  rates.  Exper- 
ience alone  will  prove  whether  the  above  quotations  will 
suffice  or  can  be  permanently  maintained. 


GROWTH    OF    INLAND    TRANSPORTATION    BUSINESS 


Insurance  of  Registered  Mail,  Packages,  etc. — Merchandise 
In  Transit  Insurance  Becoming  More  Popular 


AS  YET,  the  volume  of  insurance  written  in  Canada 
under  this  classification  is  rather  small.  Merchandise 
in  transit  insurance,  however,  is  growing  among  manu- 
facturers and  merchants,  who  make  considerable  ship- 
ments, the  pates  being  based  upon  the  form  of  bills  of 
lading  as  well  as  class  of  goods,  length  of  haul,  route  of 
shipment,  etc.  For  these  business  men  may  obtain  annual 
policies  covering  all  shipments  during  the  year,  and  open 
policies  are  issued  for  inland  transportation  and  oc&an 
voyages  to  practically  any  destination. 

The  Registered  Mail  form  of  Insurance  is  becoming 
increasingly  popular  with  banks  and  trust  companies, 
and  bond  houses,  sending  of  currency,  securities,  or  valu- 
able papers  by  mail.  No  restriction,  we  believe,  Is  placed 
upon  the  value  of  the  package,  and  the  insurance  and 
registration  rates  combined  should  be  considenably  lower 
than  express  rates.  But  the  possibility  of  heavy  losses 
at  all  times  on  a  train  carrying  currency  and  securities 
of  great  total  value  render  it  of  the  utmost  importance 


to  insure  them  only  with  companies  of  ample  financial 
resources.  Foreign  shipments,  as  well  as  those  within 
Canada  and  Newfoundland,  can  be  insured  at  special  rates, 
and  under  special  conditions.  A  full  decalration  of  values 
must  be  made  with  each  mailing  on  forms  furnished  for 
the  purpose  by  the  company,  who  usually  render  monthly 
statements  to  the  insured,  and  pay  all  losses.  Travelling 
saelsmen's  samples  may  be  insured  from  the  time  they 
leave  the  employers'  establishments  until  they  are  returned 
for  their  full  values.  Shippers  by  parcel  post,  a  method 
that  is  growing  rapidly  and  becoming  increasingly  popular, 
may  also  be  protected,  whether  the  parcels  represent  mer- 
chandise in  transit  or  private  packages  from  the  policy- 
holders' homes.  Books  of  coupons  are  furnished  by  the 
insurance  company,  and  all  the  policyholder  has  to  do  is 
to  fill  out  the  stub  of  the  coupon  and  either  enclose  the 
coupon  with  the  package  of  goods,  or  mail  it  with  the 
invoice  to  the  person  to  whom  the  package  is  addressed. 
These  coupons,  in  denominations  of  2l^c  to  5c,  which  save 
a  lot  of  valuable  time  and  trouble,  especially  when  the 
P.  O.  is  crowded,  can  be  multiplied  to  obtain  any  desired 
amount  of  insurance,  up  to,  say,  $150.  A  package  insured 
for  $10  demands  a  coupon  for  2%c,  and  one  insured  for 
$150  requires  coupons  totalling  10c,  and  it  is  covered  in 
full  until   its  delivery  to  the  one  whom  it  is  addressed. 

The  cost  compares  favorably  with  G-overnment 
charges,  although  parcels  of  low  value,  ranging  from  $5 
up  to  $100,  may  now  be  insured  at  the  post  offices  at  the 
following  rates:  For  all  packages  not  exceeding  in  value 
$5,  three  cents;  over  this  amount  and  not  exceeding  $25, 
six  cents;  from  $25  to  $50.  twelve  cents;  and  from  $50 
to   $100   in   value,   thirty   cents. 


THE    YEAR    IN    EMPLOYERS    LIABILITY    INSURANCE 


Reported  as  Satisfactory,  In  spite  of  Increasing  Competition 
From  Workmen's  Compensation  Boards 


EMPLOYERS'  liability  insurance  protects  the  employers 
against  loss  arising  from  claims  on  account  of 
accidents  to  employees  during  hours  of  employment. 
These  policies  are  of  course  more  generally  issued  to 
business  men  than  to  householders.  We  believe,  how- 
ever, that  under  the  laws  a  householder  is  personally 
liable  for  accidental  injuries  to  servants  in  their  employ, 
conseuently  those  employing  servants  find  it  necessary 
to  take  out  this  form  of  insurance,  under  which  the  com- 
pany pays  the  expenses  of  any  legal  proceedings,  and 
pays  all   dam<ages  awarded  by  the  courts. 

The  General  Accident  Assurance  Co.  of  Canada 
enjoyed  a  satisfactory  year  in  this  department,  with 
premium  receipts  tor  the  ten  months  totalling  $50,000, 
and  losses  showing  a  reduction  of  some  $3,000  compared 
with    1920. 

Provincial  Competition 
The  business  of  the  casualty  companies  has  been  ad- 
versely and  seriously  affected  during  the  last  few  years  by 
the  competition  of  the  Workmen's  Compensation  Boards  in 
the  different  provinces.  The  general  experience,  however,  of 
the  Employers'  Liability  Companies  in  Canada  is  that  pre- 
mium receipts  derived  from  artisans  employed  in  factories 
and  foundries  were  well  maintained  last  year,  in  comparison 
with  1920.  According  to  C.  W.  J.  Woodland,  the  well-known 
general  manager  for  Canada  of  the  Employers'  Liability  As- 
surance Corporation,  of  London,  Eng.,  the  common  law  right 
of  action  for  accidents  to  employees  continues  to  be  a  source 
of  much  litigation  and  substantial  causes  in  court,  so  that 
many  niei'chants  and  large  employers  of  labor  find  it  quite 
necessary  to  take  out  "common  law  liability  policies."  This 
class  of  insurance  protection  is  reported  to  be  growing 
rapidly,  and  Mr.  Woodland  says  that,  while  there  was  no 
change  in  rates  last  year,  they  are  very  low  for  the  service 
rendered.  Compared  with  1920,  he  characterized  the  year 
(1921)  just  closing  in  public  liability  and  workmen's  com- 
pensation insurance  as  fairly  good,  with  a  favorable  loss 
ratio  for  both  lines. 


January   6,   1922. 


THE      MONETARY      TIMES 


m 


iiiiiiiiiiiiiiiiiiiiiiiiiiiiiniiiiiiiiiiiiiiiiiiiiiiiiiniiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiH^ 


THE  LONDON   MUTUAL 
FIRE  INSURANCE  COMPANY 

OF  CANADA 

ESTABLISHED  1859  IN  LONDON,  ONTARIO 


HEAD  OFFICE,  33  SCOTT  STREET,  TORONTO 

Claims  Paid  Over            .....  $9,500,000.00 

Security  for  Policyholders            -                   -                -  783,206.62 

Surplus            ...                      .               .  361,777.97 

FIRE  AND  ALIOMOBILE  INSURANCE 


BRITINH     I'm. I   MHIA 

Manitoha,  Saskatciikwan,  Aliierta 

ON'rARIO 
QUKHKC 


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CARSON,  WILLIAMS  &  WILLCOX.  LIMITED.  WINNIPEG 

HEAD  OFFICE.  TORONTO 
Branch  Office.  W.  J.  CLEARY.  Manager.  MON"rREAL 


Ask  thrm  or  our  Loral  Avent  for  Rates  un  your  Property 

A.  II.  C.  CARSON         -         PRESIDENT 


IMIIIIIIIIIIIillllllllllllllllllllllllllllllllllll 


lllllllllllllll 


174 


THE      MONETARY      TIMES 


Volume  68. 


New  Developments  in  Electrical  Power 

Long  Distance  Transmission  Has  Now  Become  Practicable — 
International  Relations  As  Affecting  Power — Dominion  and 
Provincial  Jurisdiction — Broader  Market  for  Power  in  Future 


By  ANDREW  T.  DRUMMOND 


TTHE  newer  developments  in  the  electrical  transmission  of 
*  power,  under  which  there  is  a  strong  probability  that 
industrial  centres  five  hundred  and  perhaps  even  one  thous- 
and miles  distant  from  a  great  waterfall  will,  with  relatively 
moderate  loss  in  efficiency,  be  able  to  utilize  the  power  from 
this  fall,  must  now  convince  our  governments  and  industrial 
leaders  that  in  its  numei-ous  power  sites,  Canada  possesses 
facilities  for  developing  its  varied  resources  which  should 
carry  it  to  the  forefront  of  manufacturing  countries.  These 
powers  are  by  no  means  limited  to  the  two  millions  and 
more  horse  power,  if  is  expected,  will  be  possible  on  the 
Canadian  side  of  the  St.  Lawrence  River,  when  the  United 
States  and  Canada  unite  in  developing  the  ocean  highway 
between  Montreal  and  Lake  Ontario;  and  to  the  probably 
one  million  two  hundred  thousand  horse  power  which  is 
being,  or  can  still  be,  developed  within  Canadian  waters  at 
Niagara  Falls  without  lessening  the  scenic  beauty  of  the 
surroundings.  Millions  of  further  horse  power  are  avail- 
able within  our  country. 

Not  every  water  fall  or  rapid  is  adapted  for  the  de- 
velopment of  energy.  The  head  obtainable  may  be  sufficient, 
but  the  natural  conditions  of  the  surrounding  land  may  pre- 
sent a  direct  barrier,  or  be  such  that  the  cost  of  the  work 
■would  not  be  compensated  by  the  power  obtained.  The  vol- 
ume of  water  obtainable  may  be  uncertain  during  the  dry 
midsummer  months,  and  there  may  be  no  facilities  for  form- 
ing reservoirs  to  hold  back  the  spring  floods  and  heavy  rains, 
and  let  the  surplus  waters  down,  from  time  to  time,  to  equal- 
ize the  flow.  Steam  power  derived  from  coal  is  the  only 
present  competitor  of  importance,  but  the  existing 
high  prices  of  coal,  the  cost  of  its  transportation,  and  the 
expense  and  deterioration  consequent  on  the  necessary  storage 
of  huge  quantities  in  order  to  provide  for  the  winter  months, 
all  militate  against  coal,  in  comparison  with  the  more  con- 
venient, clean  and  instantaneous  electric  energy,  when  de- 
livered direct  to  the  factory,  or  to  the  municipal  distributing 
station  within  the  city  or  town. 

Power  Resources 

The  United  States  claims,  among  nations,  to  have  the 
largest  amount  of  potential  and  developed  water  power,  but 
when  the  important  rivers  of  Canada  falling  into  the  Pacific 
ocean,  the  Arctic  Sea,  Hudson  Bay,  the  North  Atlantic 
ocean,  and  the  Gulf  of  St.  Lawrence  have  been  explored, 
and  their  falls  and  rapids  have,  in  their  height,  volume  and 
flow,  been  measured,  there  is  no  reason  to  doubt  that  the 
United  States  must  easily  yield  the  place  to  Canada.  Much 
of  the  Dominion,  in  its  far  northern  and  north-eastern  areas, 
including  Labrador,  and  the  entire  country  north  of  the 
Transcontinental  Railway  and  the  Saskatchewan  River,  is 
still  unknown,  except  in,  what  might  be  termed,  unconfirmed 
outline.  Within  these  extensive  limits  of  probably  three 
thousand  miles  by  twelve  hundred  miles,  there  are  at  least 
fifty  rivers  which  are  in  magnitude  from  two  hundred  miles 
in  length,  onward  to  that  great  artery,  the  Mackenzie  River, 
■which,  as  it  expands  in  its  downward  course,  into  a  system 
of  large  lakes  and  connecting  rivers,  covers  probably  one 
thousand  eight  hundred  miles.  A  few  of  these  rivers,  espe- 
cially in  Alberta,  north  of  the  railways,  where,  in  the  shadow 
of  the  Rocky  Mountains,  they,  like  the  Athabasca,  take  their 
rise,  have  been  recently  surveyed  in  a  general  way,  and 
their  numerous  rapids,  and  ample,  but  occasionally  fluctuat- 
ing, water  supply  taken  note  of.  Others  of  these  rivers  are 
not  only  unsurveyed,  but  have  been  little  kno-wm,  except  in 
a  general  way,  to  Hudson  Bay,  however,  pass  through  coun- 


try, the  altitude  of  which  above  the  sea  is  from  750  ft.  to 
2,000  ft.  and  upwards,  these  altitudes  strongly  suggesting 
that,  in  the  reaches  of  these  rivers  lower  down,  power  ■snlJ 
be  available. 

Thus — to  illustrate  generally  these  northern  rivers — 
where  the  Transcontinental  Railway  crosses  Ontario  and 
Quebec,  and  beyond  the  height  of  land,  from  which,  among 
other  streams,  the  following  rivers  flow  northyard  to  Hud- 
son Bay,  the  altitude  above  the  sea  of  the  Nottaway  River 
is  775  ft.;  the  Missinaibi,  717  ft.;  the  Kenogami,  756  ft.; 
and  the  Albany,  1,177  ft.,  and  these  rivers,  whilst  having 
ample  volume,  are,  excepting  the  Albany,  of,  relatively,  only 
moderate  length.  In  Alberta,  the  Athabasca  River,  where 
it  is  crossed  by  the  Grand  Trunk  Pacific  Railway,  is  3,311 
ft.  above  the  sea,  at  Lesser  Slave  Lake  it  is  1,899  ft.,  at 
Athabasca  Landing  1,550  ft.,  and  at  Fort  McMurray,  after 
in  the  last  eighty  miles  developing  about  twenty  rapids, 
it  is  817  ft.  and  the  Athabasca  and  its  lake  expansion  form 
part  of  the  great  Mackenzie  system. 

The  Yukon,  again,  is  a  large  river,  taking  its  rise  under 
other  names  in  Canadian  territory,  where,  at  the  confluence 
of  the  Lewis  and  Pelly  Rivers,  it  is  2,965  ft.  above  the  sea, 
and  at  Dawson  City  on  the  main  stream,  is  still  1,200  ft. 
As  another  illustration,  Wollaston  Lake,  on  the  height  of 
land  to  the  westward  of  Hudson  Bay,  is  1,300  ft.  above  the 
sea,  and,  apparently,  at  the  source  of  Seal  River,  which 
through  perhaps  250  miles,  courses  its  way  to  that  bay. 
Explorers  have  from  time  to  time  referred  to  falls  and 
rapids  on  some  of  these  streams,  but  excepting  possibly, 
in  the  case  of  the  Athabasca  and  Nelson  Rivers,  on  the 
latter  of  which  it  is  claimed  that  three  of  the  rapids  will 
develop  over  3,500,000  horse  power,  the  estimates,  where  any 
have  been  made,  have  been,  in  perhaps  all  cases,  very  roughly 
formed,  and  generally  from  information  supplied  by  other 
parties,  and  with  no  impression  of  value  being  attached  to 
them  for  power  purposes.  Nevertheless,  all  the  known  facts 
enable  us  to  take  it  for  granted  that  on  these  rivers,  so 
many  of  which  flow  into  the  Arctic  Sea  and  Hudson  Bay, 
will  be  found  a  huge  amount  of  potential  energy,  amounting 
to  some  millions  of  horse  power,  most  of  which,  by  reasons 
of  distance  and  climate,  must,  for  the  present,  remain  un- 
developed. 

Long  Distance  Transmission 

There  is  however,  a  future,  and  perhaps  even  an  early 
future,  for  some  of  these  powers,  and  long  distance  trans- 
mission will  be  an  important  factor  in  securing  this.  There 
are  large  deposits  of  iron,  copper,  coal,  and  other  minerals, 
not  explored  in  detail,  but  known  to  exist,  in  our  north 
land,  the  mining  of  which,  and  all  the  chemical  and  metal- 
lurgical industries  associated  with  this  mining,  will  neces- 
sarily require  inexpensive  power.  It  is  also  suggestive  that 
with  the  great  cost  of  transporting  coal  to  the  central  sec- 
tions of  the  Transcontinental  Railway  in  Northern  Ontario 
and  Quebec,  and  the  nearness  of  important  water  powers 
there,  it  is  worth  investigating  whether  hydro-electric  power 
would  be  any  advantage.  And  we  might  even  look  further 
into  the  future.  In  this  age  of  wonderful  discoveries  we  must 
be  prepared  for  the  accomplishment  of  what  may,  at  first 
sight,  seem  absolutely  beyond  the  capacity  of  the  human 
mind  to  grasp.  The  hopeful  thought  may  just  now  rest 
in  the  imagination,  but  if,  by  some  happy  discovery,  which 
may  yet  come,  heat  on  a  large  scale  can  economically  result 
from  electric  power,  for  use  in  our  homes  to  replace  coal 
and  wood,  the  vast  energy  of  our  northern  rivers  which  are 
distributed  so  lavishly  ovei   half  a  continent,  may,  with  ity 


January  6,   1922. 


THE      MONETARY      TIMES 


175 


Law  Union  &  Rock 


INSURANCE    COMPANY    LIMITED 

OF  LONDON,  ENGLAND 

FIRE  BRANCH 
14  Richmond  St.  E.,  Toronto 
ALFRED  MIGHT,  Manager.      A.  E.  BLOGG,  Secretary 


ALFRED  WRIGHT, 
President 


ALEX.  MACLEAN, 
Manager  and  Secretary 


LONDDM. 


GUARANTEE  & 

c 


Personal  Accident 
Employers'  Liability 
Fidelity   Guarantee 
Teams'  Liability 


Sickness 

Workmen's    Compensation 
Elevator  Insurance 
Plate  Glass 


Automobile  Insurance. 

Head  Office. 

Company's  Building;,   61-65  Adelaide  Street,  East 

TORONTO 

Branches: 

Quebec   and    Maritime   Provinces  MONTREAL 

Manitoba  and  Saskatchewan  WINNIPEG 

British  Columbia  and  Alberto  VANCOUVER 


CASUALTY  AND  AUTO  BRANCH 
61  Adelaide  St.  E^  Toronto 
ALEX.  MACLEAN,  Manager. 


Mercantile 

I  FIRE  li, 

%,  Insurance^ 


TOTAL  SECURITY 

$50,250,000 


Chief  Oflfice  for  Canada : 

14  RICHMOND  STREET  EAST 

TORONTO 


ALFRED  VVKIGHT 


A.  £.   BLOOO 
Secretary 


176 


THE      MONETARY      TIMES 


Volume  68. 


varied  resulting  conveniences,  ultimately  prove  to  be  another 
providential  plan  of  the  Creator  which  would  help  to  lessen 
the  rigors  of  the  long  winter  months  and  make  this  north 
land  a  shade  more  habitable.  Apart  from  these  possibilities, 
there  is  the  suggestion  that  industries  requiring  large 
amounts  of  power,  like  the  production  of  nitrogen  from  the 
air,  and  of  wood  pulp,  where  the  mills  can  still  be  con- 
veniently close  to  the  spruce  forests,  might  also,  through 
long  distance  transmission,  utilize  some  of  these  northern 
powers. 

Great  Market  For  Power 
Canada,  as  a  manufacturing  country,  has  attained  a 
new  status.  There  is  no  longer  a  reason  why  our  govern- 
ments should  regard  it  as,  primarily,  an  agricultural  coun- 
try, and  why  it  should  give  encouragement  only  to  the  immi- 
grant who  will  settle  on  the  land.  It  is  quite  true  that  the 
western  prairies  as  well  as  our  eastern  farms  need  many 
more  men  of  that  class,  but  our  manufacturing  industries 
now  produce  more  value  in  output  than  the  entire  agricul- 
tural production  of  the  country.  With  vast,  and  in  many 
cases,  untouched  resources,  supplemented  by  magnificent 
water  powers  with  which  to  work  them  into  exportable  pro- 
ducts, and  by  ample  transportation  facilities,  we  want  direct 
encouragement  to  be  given  to  men  of  initiative,  enterprise 
and  capital  from  Great  Britain  and  the  United  States  to 
co-operate  with  Canadians  in  developing  these  resources.  We 
also  want  the  skilled  workmen  to  man  the  manufactories 
that  must  follow. 

To    export    the    raw   material,    and    thus    furnish    work 
for   scores   of  thousands   of  skilled  men   in   other   countries, 
instead  of  having  manufactories  to  build  up  our  own,  has 
been  one  of  Canada's   serious  mistakes   in  the  past.     Even 
the  hydro  power  itself  at  Cedar  Rapids  on  the  St.  Lawrence, 
and   at  Niagara  Falls,   and  on   the   Rainy   River,   was   per- 
mitted by  the  Dominion  to  be  exported,  like  a  raw  material, 
to  the  United  States,  instead  of  the  government  compelling 
the  American  manufacturers — when  such  an  opportunity  pre- 
sented itself — to  locate  on  the   Canadian   side  of  the  rivers 
and  make  their  establishments  the  centre  of  busy  industrial 
towns  here.    Even  if  the  market  for  their  manufactured  goods 
was  claimed  by  Americans  to  be  chiefly  in  the  United  States, 
the    much    less    expensive    power,    and    the    otherwise    lower 
average  cost  of,  at  that  time,  producing  such  goods  in  this 
country,   would   have   enabled   these   manufacturers   to,   per- 
haps entirely,  pay  the  American  duties,  whilst,  in  addition, 
they  could  export  from  this  side  more  cheaply  than  through 
United  States  ports.     Conditions  during,  and  since,  the  war 
have  become  greatly  changed  here  both  as  to  the  home  and 
the  export  trade,  and  with  the  large  preferences  now  con- 
ceded throughout  the  empire  to  Dominion  products,  there  is 
a    clear    advantage    to    United    States    industrial    works    to 
establish  branches  in  Canada.     About  six  hundred  of  these 
are  already  located  in,  especially,  Ontario  cities  and  towns, 
and  more  are  coming.     In  the  face  of  this  fact,   there   are 
still  people  in  our  country  who  have  such  limited  vision  and 
enterprise  as  to  approve  of  the  further  export  of  power  to 
the  United  States.     It  will  be  greatly  to  our  discredit  if  we 
fail  to  take  advantage  of  this  special  means  of  building  up 
our  own  country. 

General  Electric 's  Discovery 
Two  hundred  and  fifty  miles  are  the  extreme  distance 
to  which  hydro-electric  power  has  been  thus  far  profitably 
transmitted.  The  recent  discovery  at  the  General  Electric 
Company's  laboratories  at  Schenectady,  New  York  State, 
that  one  million  volts  are  possible,  will,  it  is  there  believed, 
enable  the  power  current  to  be  sent  to  distances  double, 
and  perhaps  quadruple,  the  present  maximum.  The  effect 
of  this  in  our  prairie  provinces,  for  instance,  would  be  re- 
markable, wherever  the  raw  material  could  be  laid  down 
at  low  cost,  and  a  sufficiently  large  market  for  tlie  products 
could  be  found,  and  provided  cheap  coal  did  i.ot  interfere. 
The  possible  104  ft.  fall  at  Grand  Rapids,  where  the  Sas- 
katchewan River  falls  into  Lake  Winnipeg  would  have  with- 
in economical  range,  in  the  distribution  of  its  power,  such 
cities  and  towns  as  Regina,   Saskatoon,   Battleford,   Prince 


Albert  and  scores  of  smaller  places  between  Grand  Rapids 
and  the  United  States  boundary  line,  whilst  following  the 
lead  of  Ontario,  the  advantages  of  power  and  light  could 
be  within  the  reach  of  thousands  of  farmers  for  use  in 
farming  operations.  Similarly,  Alberta,  down  to  the  United 
States  boundary  line,  could  be  reached  by  the  energy  of  the 
Athabasca  River,  should  Calgary  require,  as  is  probable,  for 
its  own  use  the  whole  of  the  Bow  River  power. 

Use  ou  Railways 

Electric  power,  as  applied  to  railways,  appears,  thus 
far,  to  have  its  limitations.  The  steam  roads  which  have 
for  some  years  been  experimenting  with  it  on  their  lines, 
have  confined  its  use,  as  a  rule,  to  special  work,  as  in  tun- 
nels, on  grades  through  the  mountains,  and  on  work  at  ter- 
minals. On  the  other  hand,  the  electric  roads,  with  a  quarter 
of  a  century  of  experience  behind  them,  have  only  given  a 
limited  attention  to  freight,  which  on  the  steam  roads  is 
the  larger  and  much  more  profitable  part  of  the  traffic.  With 
few  exceptions,  both  in  the  United  States  and  Canada,  inter- 
urban  electric  roads  have  not  proved  profitable  enterprises. 
They  appear  to  be  best  adapted  to  passenger  transport 
through  very  populous  districts  immediately  surrounding 
large  cities,  or  from  city  to  city  where  these  are  very  close 
to  each  other,  and  where,  in  each  case,  a  very  frequent  ser- 
vice can  be  given  with  a  certainty  of  large  advantage  being 
taken  of  it. 

Hydro-electric  power  has,  during  recent  years,  been  of 
assistance,  but  nothing  can  overcome  the  result  to  the  rail- 
way of  a  limited  population.  The  most  attractive  problem 
still  to  be  solved  in  Canada  is  whether,  with  abundant,  elec- 
trically-transmitted water  power,  it  would  be  profitable  to 
the  railways  and  assist  business,  to  electrify  sections  of  the 
older  steam  roads,  where,  as  in  parts  of  Ontario,  they  pass 
through  fine,  productive  districts  possesing  fair  sized  cities 
and  towns  in  proximity  to  each  other,  the  electric  trains  to 
take  both  freight  and  passengers.  This  is  quite  a  different 
question  from  the  building  of  new  electric  roads.  The  rail- 
way has  been  in  operation  for  probably  a  half  of  a  century, 
a  large  business  has  been  gradually  developed,  and  it  is 
only  a  case  of  further  advantage  being  gained  by  the  rela- 
tively light  added  cost  of  electrifying.  From  the  steam 
road  point  of  view  the  proposal  is  practicable,  and,  under 
certain  conditions,  would  appear  to  be  applicable  to  one  or 
two  branch  lines  of  the  Grand  Trunk  Railway  in  Ontario. 
The  experience  gained  there  would  be  of  value  in  consid- 
ering the  electrifying  of  other  sections.  Should  the  Dominion 
Government  assume,  as  it  certainly  should,  its  rightful  con- 
trol over  all  the  international  and  navigable  waterways  of 
the  country,  including  in  this  the  whole  St.  Lawrence  system 
from  Lake  Superior  to  the  sea,  the  government  railways  will 
have  ample  opportunities  of  obtaining  the  necessary  hydro- 
electric power. 

Govermuent  Jurisdiction 

The  clear  intention  under  the  Imperial  British  North 
America  Act  of  1867  was  that  the  Dominion  should  have 
the  control  of  all  international  and  navigable  waters  through- 
out Canada,  and  of  the  water  powers  developed  upon  them. 
For  reasons  difficult  to  understand,  the  Canadian  Govern- 
ment has  hitherto  failed  to  realize  the  direct  bearing  upon 
trade  and  commerce  which  these  water  powers  have.  Espe- 
cially has  this  been  the  case  since  transmission  to  great 
distances  has  become  effective  in  helping  to  cheapen  the  cost 
of  production  among  manufacturers,  and  to  greatly  expand 
trade,  particularly  by  inducing  manufacturers  in  the  United 
States  and  Great  Britain  to  establish  branches  of  their  works 
in  this  country.  Further,  at  the  present  time,  when  new 
sources  of  revenue  are  so  important,  there  could  be  obtained, 
without  directly  taxing  the  people,  a  large  annual  return, 
amounting  to  many  millions  of  dollars  from  a  reasonable 
charge  for  each  horse  power  developed.  The  writer  has  re- 
peatedly brought  the  subject  of  the  Dominion  rights,  and  the 
possible  revenues  from  them,  before  different  departments  of 
the  government. 

What  is  wanted  is  a  definite  policy  in  regard  to  all  water 
powers  upon  international  and  navigable  rivers,  under  which 


January   6,   1922. 


THE      MONETARY      TIMES 


177 


Fire,  Automobile,  Bonding,  Employers'  Liability, 
Health  and  Accident  Insurance 


J.  O.  MELIN 


Vice-President  and  General  Manager 


MERCHANTS'    CASUALTY    COMPANY 

^  Head   Office  : 

Winnipeg,  Manitoba 

operating  throughout  the  Dominion  oj  Canada  and  Newfoundland 
under  the   supervision  of  the   Dominion  Insurance  Department. 

POLICIES  ISSUED  PROVIDING  FULL  COVERAGE  ON 

Accident,  Sickness  and  Automobile 

Insurance 


For  Liberal  Agency  Contracts  write  Head  Office  or  Branch  Offices,  at 
Halifax,  Montreal,  Toronto,  Regina,  Edmonton,  Vancouver 


178 


THH      MONETARY      TIMES 


Volume  68. 


they  would  be  controlled  by  the  Dominion  in  the  interests 
of  navigation,  industries,  railways  and  civic  and  domestic 
convenience,  and  would  only  be  leased  and  at  a  fair  annual 
rental,  payable  to  the  government,  for  each  horse  power  of 
possible  development.  Finding  no  direct  assertion  of  rights 
by  the  Dominion  Government,  the  Ontario  Government  has 
actually  assumed  control  of  the  power  at  Fort  Francis  on 
the  Rainy  River,  at  Sault  Ste.  Marie  on  the  St.  Mary's  River, 
and  at  Niagara  Falls,  and  has  made  claims  to  the 'undeveloped 
power  of  the  St.  Lawrence  River  below  Prescott.  It  has 
further  endeavored  to  fortify  by  acts  of  its  own  legislature 
much  of  what  it  has  done.  All  this  is  of  recent  date,  the 
first  actual  development  of  power  under  authority  from  it, 
materializing  only  in  1902. 

Had  the   Dominion   Government   established   a   National 
Park  at  Niagara  Falls,  as  it  should  have  done,  and  was  in- 


vited in  1880  by  the  Ontario  Legislature  to  do,  instead  of 
allowing,  by  its  neglect,  the  Ontario  Government  in  1885  to 
undertake  the  work,  simply  as  a  park,  and  with  no  thought 
of  water  power  development,  there  is  no  question  that  we 
should  never  have  heard  of  Ontario's  rights  in  water  powers. 
The  forthcoming  report  of  the  International  Waterways  Com- 
mission on  the  deepening  of  the  St.  Lawrence  with  a  view 
to  an  ocean  highway,  and  the  action  which  the  United  States 
Congress  and  our  Parliament  at  Ottawa  take  in  regard  to 
it,  must  necessarily  bring  to  the  front  all  questions  as  to 
Dominion  and  Provincial  rights  in  both  international  and 
navigable  waters.  The  Ontario  Government  may,  however, 
rest  assured  that  the  heavy  indebtedness  which  it  has  in- 
curred in  connection  with  Niagara  Falls  developments  will, 
under  any  circumstances,  be  carefully  guarded  in  the  interest 
of  the  bondholders. 


Legal  Decisions  Affecting  Life  Insurance 

Clarke  vs.  Great  West  Life  Assurance  Co. — Case  Where  a 
Third  Party  Paid  Premiums — Life  Insurance  Pledged  as  Bank 
Collateral — Case  Where  Beneficiary  Died  Before  the  Assured 


ONE  of  the  outstanding  legal  cases  of  the  year,  as  affecting 
life  insurance,  was  that  of  Clarke  v.  Great  West  Life 
Assurance  Co.  which  was  an  action  to  enforce  payment  of 
two  life  insurance  policies  on  the  life  of  the  husband  of  tJhe 
plaintiff.  The  policy  as  issued  contained  the  following  pro- 
visions, forming  the  basis  of  the  above  action,  namely: 

"(1)  If  default  be  made  in  the  payment  of  the  first  or 
any  subsequent  premiums  or  any  part  thereof,  or  of  any 
note,  cheque  or  other  obligation  given  on  account  thereof 
this  policy  shal'  be  void  ;  (2)  should  this  policy  lapse  it  will 
be  reinstated  at  any  time  upon  the  production  of  evidence  of 
insurability  satisfactory  to  the  company  and  the  payment  of 
all  overdue  premiums  and  any  other  indebtedness  to  the 
cent,  per  annum  compounded  annually  from  the  date, of 
lapse." 

The  iccts  of  the  ca:e  r,nd  the  judgment  of  the  Court  are 
aa  fol'ows: — 

"This  is  an  action  to  enforce  payment  of  two  life  insur- 
ance policies  on  the  life  of  Dr.  Clarke,  the  husband  of  the 
plf.intiff,  who  died  on  December  8,  1918.  The  defence  is  that 
the  policies  lapsed  before  the  death  of  the  assured,  for  the 
non-payment  of  a  quarterly  payment  on  one  of  the  policies 
and  the  non-payment  of  instalments  due  under  promissory 
notes  given  for  past  due  premiums,  and  that  no  evidence  of 
the  inaurability  of  the  deceased  satisfactory  to  the  defendant 
was  furnished  by  assured  after  the  lapse  of  the  policies  and 
prior  to  his  death. 

"The  quarterly  premium  was  due  on  September  24,  1918, 
and  was  for  the  sum  of  $36.85.  On  September  18,  the  com- 
pany wrote  the  assured  calling  his  attention  to  the  fact 
that  the  premium  would  be  due  on  the  24th  of  that  month, 
and  again  on  October  10,  they  wrote  him  that  the  days  of 
grace  would  end  on  October  24,  and  on  October  23  he  sent 
them  a  cheque  for  this  amount. 

"The  other  payments,  for  non-payment  of  which  it  is 
claimed  the  policy  lapsed,,  were  the  monthly  payments  on 
the  notes  for  past  due  premiums  due  on  the  16th  days  of 
September,  October  and  November.  The  payment  which 
fell  clue  September  16,  not  having  been  paid,  the  policy 
lapsed. 

An  application  for  reinstatement  was  sent  in  on  October 
28,  and  the  instalments  due  on  the  notes  on  September  16 
and  October  16  were  paid.  On  November  2L  the  company 
accepted  evidence  of  insurability  of  the  assured  up  to  October 
28,  and  forwarded  the  same  to  Wright,  their  agent  in  Regina. 

"The  policies  became  void  on  September  16,  1918,  and, 
'jefore  they  could  be  reinstated,  evidence  of  the  insurability 


satisfactory  to  the  company  would  have  to  be  produced  and 
all  overdue  premiums  and  other  indebtedness  paid. 

"It  was  their  practice  to  pass  upon  evidence  of  insurability 
sent  into  them,  and  then  forward  the  same  to  tlieir  agent  at 
the  place  where  the  insured  lived,  for  him  to  collect  all  over- 
due payments  and  satisfy  himself  that  assured  was  still  in 
good  health.  That  was  done  in  this  case,  and  the  jury  have 
so  found. 

"The  company  contends  that  it  was  necessary  to  inform 
the  insured  as  to  his  reinstatement  before  it  takes  eifect. 
Upon  this  point  the  jury  has  found  that  Wright  on  December 
2,  1918,  told  Miss  Williams  (Dr.  Clarke's  bookkeeper)  that, 
if  she  did  not  hear  from  him  or  the  defendant  company  with- 
in three  or  four  days,  she  could  rest  assured  the  policies 
would  be  all  right.  As  there  was  evidence  upon  which  they 
could  make  this  finding,  it,  in  my  opinion,  satisfies  the  above 
contention. 

"I  am  therefore  of  the  opinion  that  all  arrears  on  both 
policies  were  paid  on  December  2,  1918,  and  that  on  that 
date  the  company  had  accepted  evidence  of  the  insurability 
of  Dr.  Clarke  and  reinstated  the  two  policies." 

Third   Party  Paid   Premium 

Another  important  action  in  reference  to  life  insurance 
arose  on  the  question  whether  a  third  party  paying  premiums 
of  the  insured  thereby  obtained  a  lien  for  the  amonut  of  the 
premiums  against  the  po'.icy.  Mr.  Justice  Orde  held  that  such 
third  party  did  not.  He  dismissed  the  claim  by  the  Fidelity 
Trust  Company,  of  Newark,  N.  J.,  and  by  Mrs.  Carrie  Louise 
Lumsden  to  recover  sums  totalling  something  over  $2,000, 
for  premiums  paid  on  policies  on  the  life  of  Robert  H.  Fen- 
wick. 

Mr.  Fenwick,  at  the  age  of  45,  had  a  nervous  breakdown, 
and  was  for  the  rest  of  his  life,  off  and  on,  an  inmate  of 
asylums  or  sanitaria.  He  divested  himself  of  his  property 
in  favour  of  his  wife.  His  wife  paid  the  premiums  on  his 
five  policies  while  she  could,  and  afterwards  iher  sister,  with 
whom  she  lived,  and  who  spent  thousands  of  dollars  to 
support  her,  paid  them. 

"It  might  seem  at  first  blush,"  says  Justice  Orde,  "that 
upon  some  principle  of  equity,  they  should  be  entitled  to 
repayment.  This  view  when  examined,  however,  will  be 
found  to  be  grounded  upon  some  principle  of  salvage  anal- 
ogous to  that  of  salvage  in  maritime  law,  but  it  is  clear  on 
authority  that  no  such  principle  is  applicable  under  Englsh 
law  where  a  mere  stranger  chooses  to  keep  alive  an  insur- 
ance policy  by  paying  premiums  out  of  his  own  pocket." 

His  Lordship  quotes  Justice  Bowen,  who  says:  "The 
general  principle  is  beyond  all  question  that  work  and  labor 
done  or  moneys  expended  by  one  man  to  preserve  or  benefit 


January  6,  1922.  THBMONBTARYTIMES  17» 
^IIIIIIIIIIIIIIIIMIIIIIIIIIIinillllilllllllllMIIIIIIIIIIIIIIIIIIIIHIIIIIIIIIIIIIIIIIIIIUIMIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIMMIIIIIIIIIIHIIHHIIIIMIIIIIIIIIIirilMII^^ 

I  The  Continental  Fire  Insurance  | 

I  ConiI>any  | 

I  Head  Office  I 

I  Huron  and  Erie  Building            -            WINNIPEG  | 

I  D.  W.  McOUAIG,  President                                                                            A.  E.  HAM,  Vice-President  1 

i  G.  S.  FRANCIS,  Secretary-Treasurer.  | 

I  TRANSACTING,                                                *  | 

i  FIRP],  AUTOMOBILE,                                                       SICKNESS  AND  ACCIDBJSIT.  i 

i  HAIL  AND  LIVE  STCX)K  INSURANCE  § 

I  GUARANTEE  BONDS  | 

=  Live  Agents  Wanted  in  Manitoba,  Saskatcliewan  and  Alberta  s 


The     Manitoba     Farmers'     Mutual 
Hail    Insurance  Company 

The  Oldest  and  Strongest  Mutual  Hail  Insurance  Company  in  Canada 

OPERATING     IN     MANITOBA     ONLY 

Over  $3,000,000.00  Written  in    1921 

INSURANCE     AT     COST 

Head  Office 
Huron  and  Erie  Building  -  WINNIPEG 

G.  S.  FRANCIS,   Secretary-Treasurer. 


The    Standard    Mutual    Fire 
Insurance  Company 

=                                                            Young  and    Progressive  [ 

I                    INSURANCE  AT  COST.              RURAL  AND  FARM  RISKS  ONLY.  j 

I                                             Good  Live  Agents  Wanted  in  Manitoba  [ 

I                                                                           Head  OHico  [ 

I                Huron  and  Erie  Building            .             WINNIPEG  \ 

i             D.  W.  McCUAIG,  President                          .                                         A.  E.  HAM,  Vice-President  | 

I                                                                     G.  S.  FRANCIS,  Secretary-Treasurer.  | 

riniMIIMIIIIIIIIIIIUnilllllMIIIUIIIIIIIIIIIIIIIIIIIunilllllllllllMIIIIIUMH/MIIIIMIIIIMIIIIIIIIIIIIMIinilllllllllllMMIIIIIIIMIIIIIIIIIillllMIIIIIIIIIIIII^ 


180 


THE      MONETARY      TIMES 


Volume  68. 


the  property  of  another,  do  not,  according  to  EngLilsh  law, 
create  any  lien  upon  the  property  saved  or  benefitted.  Lia- 
bilities are  not  to  be  enforced  upon  their  backs  any  more 
than  you  can  confer  a  benefit  upon  a  man  against  his  will." 

Policy  Held  by  Cfcditor 

The  third  case  for  review  here,  arose  under  circumstances 
in  which  a  life  insurance  policy  had  been  pledged  as  collateral 
security  for  indebtedness  to  a  Bank  and  then  had  been 
allowed  to  lapse.  The  case  was  decided  on  the  principle  that 
a  creditor  is  liable  for  the  deterioration  of  the  thing  pledged 
and  the  Banque  d'  Hochelaga  was  held  liable  in  damages, 
by  the  Quebec  Superior  Court,  because  it  allowed  the  lapse 
of  a  policy  of  life  insurance  that  had  been  transferred  to  its 
Quebec  branch  as  collateral  security  for  a  certain  indebted- 
ness of  Joseph  Labonte,  one  of  its  clients.  The  full  value  of 
the  policy  was  sued  for  ($2,000),  but  the  court  considered 
the  clkim  was  exaggerated,  and  ruled  that  the  measure  of 
liability  was  the  redeeming  value  of  the  instrument  at  the 
Mme  the  action  was  taken. 

liabonte  transferred  the  policy  to  the  bank  in  1905.  The 
annual  premiums  ($69.72)  were  paid  by  the  bank  half-yearly 
until  July,  1914,  when,  owing  to  forgetfulness  on  the  part 
of'  an  official,  the  premium  was  left  unpaid,  and  when  the 
policy  was  returned  to  Labonte  after  he  had  paid  off  his 
indebtedness  it  was  found  to  have  lapsed.  At  the  time  he 
was  so  ill  that  he  could  not  be  reinsured,  and  he  took  the 
present  action,  alleging  that  the  bank  was  liable  to  him  for 
the  face  value  of  the  policy  in  good  standing,  namely,  $2,000. 
Labonte  died  during  the  instance,  and  his  cause  was  taken 
up  by  one  Belanger,  the  curator  of  his  estate. 

The  bank  denied  all  liability,  submitting  that  it  made 
no  undertaking  to  pay  the  premiums  on  the  policy,  and, 
though  it  inadvertent'y  neglected  to  do  so  in  one  instance, 
which  turned  out  to  be  fatal  to  the  benefit,  nevertheless  this 
omission  did  not  incur  legal  liability  for  any  loss  to  Labonte. 

Application  of  Law 

Another  interesting  case  was  one  decided  by  the  Supreme 
Court  of  Alberta  in  which  the  Confederation  Life  Association 
had,  on  June  3,  1887,  issued  a  policy  for  $1,000  on  the  life 
of  John  J.  Mellon  in  favor  of  himself,  and  on  May  5,  1897, 
the  insured  executed  a  declaration  in  which  he  appointed  his 
wife,  Amelia  Mellon,  and  daughter,  Amelia  Elizabeth  Mellon, 
beneficiaries  under  said  policy.  His  wife  pi-edeceased  him  and 
the  insurance  company  paid  the  proceeds  of  the  policy  to 
his  daughter,  surviving  beneficiary. 

The  Grand  Orange  Lodge  of  B.  N.  A.  issued  a  policy 
on  the  life  of  the  said  Mellon  for  $1,000  payable  to  himself 
and  the  proceeds  of  such  policy  were  paid  into  Court  pur- 
suant to  an  order  of  Justice  Scott  and  the  insurer  was  re- 
leased from  any  further  liability  in  respect  of  same. 

At  the  date  of  his  death  Mellon  was  a  resident  and 
domici'ed  in  the  province  of  Alberta.  On  March  25,  1914, 
Mellon  became  insane  and  died  in  a  sanitarium  in  Guelph, 
Ontario,  on  March  4,  1918. 

The  Confederation  Life  policy  provided  that  "In  all  cases 
of  claims  under  this  policy  the  law  of  Ontario  shall  govern." 

Mr.  Justice  Simmons  in  his  judgment  said: 

"The  law  of  Ontario  in  regard  to  the  distribution  of  the 
proceeds  of  insurance  policies  was  modified  in  1897  and  1914 
and  that  of  Alberta  in  1915  and  1916.  The  Confederation 
Life  Association  was  incorporated  by  Acts  of  the  Parliament 
■of  Canada  and  was  registered  under  the  provisions  of  the 
Alberta  Insurance  Act.  Section  43  of  the  Alberta  Act,  1915, 
provides  that  "the  money  payable  under  any  policy  of  life 
insurance  already  issued  or  that  may  hereafter  be  issued 
by  an  insurance  corporation  that  has  already  become  or 
may  hereafter  become  registered  under  the  provisions  of  this 
Act  .  .  .  shall  in  all  cases  be  payable  in  the  province  where 
the  assured  is  or  dies  domiciled  therein  notwithstanding 
anything  contained  in  any  policy  or  the  fact  that  the  head 
office  of  the  insurance  corporation  is  not  within  the  province." 

"The  operative  words  of  the  section  'shall  be  payable  in 
the  province'  do. not  purport  to  do  more  than  declare  the 
situs  of  the  debt  shall  be  in  the  province  and  I  think  it  is 
reading  into  the  section  that  which  is  not  contained  therein 
to  hold  that  the  law  of  Alberta  should  apply  in  determin- 
ing the  construction  of  the  contract    especially    v^hen  to  do 


so  is  to  go  to  the  root  of  the  contract  and  so  modify  it  as  to 
alter  the  declared  intention  of  the  parties  when  the  contract 
was  entered  into.  To  adopt  the  view  that  the  laws  of  Alberta 
would  apply  in  construction  of  a  contract  made  in  another 
province  by  a  company  which  is  the  creation  of  the  Parlia- 
ment of  Canada  would  raise  very  grave  and  far-reaching 
conclusions  on  constitutional  law  which  I  do  not  think 
necessary  to  be  dealt  with  in  my  view,  that  the  aplication 
of  the  section  under  libei-al  construction  does  not  involve  any 
more  than  a  declaration  as  to  the  place  of  performance  of 
the  obligation  arising  out  of  the  contract. 

"I  conc'ude,  therefore,  that  the  provision  in  the  contract 
whereby  the  parties  agreed  that  the  law  of  Ontario  should 
govern  in  regard  to  the  distribution  of  moneys  under  the 
policy  is  applicable. 

"It  would  appear  that  so  far  as  the  declaration  in  this 
policy  is  concemed,  the  daughter  as  a  surviving  preferred 
beneficiary  was  entitled  to  the  entire  proceeds  of  the  policy. 

"The  policy  in  the  Grand  Orange  Lodge  of  B.  N.  A.  is 
not  available  but  it  seems  to  be  assumed  by  all  the  parties 
to  the  reference  that  the  contract  was  made  in  Ontario  and 
applying  the  principles  above  referred  to  the  law  of  Ontario 
v/ould  govern." 


LEGAL,  DECISIONS  ON  FIRE  INSURANCE 


Only    Two    of     Importance    During    Past    Year  —  London 

Mutual  Fails  to  Recover  Amount  Paid  to 

Policyholder 


REPORTS  of  fire  insurance  actions  decided  by  Canadian 
courts   during  the  year  have  not  been  numerous,  nor 
very  important — two  only  being  worthy  of  notice  herein. 

The  first  is  that  of  London  Mutual  v.  Miller,  decided  by 
the  Manitoba  Court  of  Appeal,  the  decision  being  in  sub- 
stance that  where  an  insurance  company  comes  into  court 
to  recover  back  a  claim  paid  by  it  after  investigation  by  its 
agent  and  adjuster  alleging  fraudulent  representations  by 
the  assured,  it  must  establish  clearly  and  specifically  the 
fraudulent  acts  and  conduct  which  induced  it  to  pay  over 
the  money.  Contradictions  and  discrepancies  in  the  accounts  . 
given  of  the  fire  and  of  the  property  insured  of  the  owner, 
a  foreigner  does  not  properly  understand  English,  are  not 
enough  to  establish  fraud  where  there  is  apparently  no 
motive  and  the  value  of  the  property  destroyed  substantially 
exceeds  the  amount  of  the  insurance. 

The  other  case  was  decided  on  April  1st  in  Montreal  by 
Justice  Maclennan  dismissing  an  action  instituted  by  Adelard 
Lefebvre  against  the  Compagnie  d' Assurance  Mont  Royal, 
seeking  to  compel  the  defendant  to  i.ssue  to  him  a  fire  insur- 
ance policy  in  which  the  risk  insured  on  the  goods  and  effects 
in  premises  at  106  Hadley  St.  should  be  placed  at  $1,600. 

Plaintiff  stated  that  he  applied  to  defendant  for  a  policy 
of  insurance  in  September,  1919,  when  the  amount  of  risk 
was  fixed  at  $1,600,  and  an  interim  receipt  covering  insurance 
for  this  amount  was  issued  to  him.  On  November  29  fol- 
lowing he  was  surprised  to  receive  a  policy  insuring  his 
effects  to  the  extent  of  $1,200  only,  this  policy  being  received 
by  him  after  he  had  notified  the  company  of  a  fire  which 
took  place  on  the  in.sured  premises.  The  policy  was  accom- 
panied by  a  schedule  dividing  the  $1,200  between  certain 
classes  of  plaintiff's  effects,  a  condition  and  limitation  for 
which  he  said  he  never  applied.  Consequently,  he  alleged 
that  he  was  prevented  from  exercising  his  proper  rights 
under  the  insurance. 

Defendant  pleaded  that  after  the  fire  it  was  found  that 
the  value  of  the  goods  and  effects  in  the  plaintiff's  premises 
was  not  more  than  $1,200,  and  it  was  then  and  there  agreed 
between  plaintiff  and  defendant's  afeent  that  the  interim  re- 
ceipt should  be  corrected  in  order  to  make  it  concur  with 
the  value  of  the  insured  goods. 

Justice  Maclennan,  after  examining  the  proof  and  docu- 
ments produced,  reached  the  conclusion  that  the  company 
defendant  never  agreed  or  undertook  to  insure  plaintiff  for 
the  sum  of  $1,600,  or  to  issue  him  a  policy  for  that  amount. 

Plaintiff's  action,  therefore,  was  dismissed  with  costs. 


January   6,   1922. 


T  H  K       M  U  N  K  T  A  H  y       T  1  M  K  S 


181 


THE 


s^ 


.^"^ 


V 


ISA 
GOOD  COMPANY 
TO  INSURE  WITH 


Head  Office,  London,  Ont. 


CROWN  LIFE 


AN     ALL-CANADIAN      COMPANY 


Policies  Exceed 
$29,000,000. 

Assets    Exceed 
$4,000,000. 


Liberal  Contracts  on  all  Approved  Plans 
Excellent  Openings  for  Insurance  Salesmen 

THECROWN  LIFE  INSURANCE  COMPANY 

Home  Office         •        Toronto 

Branch   Offices    Throughout    Canada. 


THE 


Ocean  Accident  and  Guarantee 

Corporation  Limited 

OF  LONDON,  ENGLAND 

Personal    Accident,  Sickness,  Liability,  Automobile 
Plate  Glass,  Guarantee,  Burglary,  and  Fire  Insurance 


Assets,  December  31st,  1920,  Exceed 
Claims  paid  in  Canada  since  1903  exceed 


$37,300,000.00 
$  4,000.000.00 


Canadian  Head  Office 


TORONTO 


W.  T.  PERRY,  Manager  for  Canada  J.  A.  MINGAY,  Assistant  Manager 

BRANCHES  :    ST.  JOHN,    MONTREAL,    WINNIPEG,     REGINA,   CALGARV.    VANCOUVER 

Applications  for  Agencies  Invited. 


182 


THE      MONBT  A-R  T      TIMES 


Volume  68. 


STATUTORY  CONDITIONS  IN  FIRE  POLICIES 


Ontario's  Legislation  Was  Followed  by   Similar  Action  in 

Manitoba,    British    Columbia,    Nova    Scotia, 

Alberta  and  Saskatchewan 


HG.  SHALLCROSS,  insurance  adjuster,  Vancouver, 
•  spoke  on  "Statutory  Conditions  in  Fire  Policies"  at  a 
meeting  of  the  Vancouver  Insurance  Institute  on  November 
24.    He  said  in  part: — 

"Statutory  conditions  in  relation  to  fire  insurance,  are 
of  comparatively  recent  origin.  Previous  to  statutory  con- 
ditions coming  into  force  the  terms  of  fire  insurance  policies 
were  a  matter  entirely  of  agreement  between  the  insurance 
companies  and  the  assured. 

"In  order  to  protect  themselves  from  fraud,  insurance 
companies  gradually  increased  protective  clauses  in  the  poli- 
cies until  the  conditions  become  so  onerous  that  the  judges 
of  the  courts  began  to  pass  strictures  on  the  terms  of  the 
contract  on  given  cases  coming  into  court.  These  strictures, 
of  course,  had  relation  to  those  losses  which  the  courts  re- 
garded as  perfectly  honest. 

First  Action  in  Ontario 

"This  condition  finally  led  to  the  interference  of  the 
Legislature  in  the  Province  of  Ontario,  and  in  1874,  the 
l,egislature  of  Ontario  by  38  Vict.  Cap.  65,  adopted  the  fol- 
lowing legislation:— 

"A  commision  is  to  be  issued  by  the  Lieutenant-Governor 
addressed  to  three  or  more  persons  holding  judicial  office  in 
this  province,  for  the  purpose  of  determining  what  conditions 
of  a  fire  insurance  policy  are  just  and  reasonable  conditions." 

"The  commissioners  were  all  judges,  some  of  them  sub- 
sequently becoming  chief  justices  of  the  Supreme  Court  or 
Court  of  Appeal.  Their  recommendations  were  contained  in 
the  following  Act,  39  Vict.,  cap.  24.  This  act  with  such 
amendments  as  have  since  been  made  contains  the  Statutory 
conditions  now  in  force  in  the  Province  of  Ontario. 

"The  success  which  attended  the  adoption  of  Statutory 
conditions  in  Ontario  led  to  similar  legislation  in  Manitoba 
in  1888;  in  British  Columbia  in  1893;  in  Nova  Scotia  in 
1889 ;  in  Alberta  and  Saskatchewan  in  1903. 

"The  British  Columbia  Statutory  conditions  as  promul- 
gated to  this  date  are  contained  in  an  act  entitled:  "An  Act 
to  Secure  Uniform  Conditions  in  Policies  of  Fire  Insurance" 
—Chap.  37,  assented  to  29th  of  March,  1919.  These  statu- 
tory conditions  are  endorsed  on  the  back  of  all  policies  of 
fire  insurance  issued  in  British  Columbia.  But  there  are 
certain  explanatory  clauses  in  the  preamble  of  the  Act 
which  are  not  endorsed  on  the  policies.  Some  of  these  clauses 
it  is  useful  to  bear  in  mind  and  I  cite  the  following: 

lAisrepresentation 

"If  any  person  or  persons  insures  his  or  their  buildings 
or  goods,  and  causes  the  same  to  be  described  otherwise  than 
as  they  really  are,  to  the  prejudice  of  the  company,  or  mis- 
represents or  omits  to  communicate  any  circumstances  which 
is  material  to  be  made  known  to  the  company,  in  order  to 
enable  it  to  judge  of  the  risk  it  undertakes,  such  insurance 
shall  be  of  no  force  in  respect  to  the  property  in  regard  to 
which  the  misrepresentation  or  omission  is  made." 

"Long  before  it  became  the  practice  to  embody  integ- 
rity in  a  statutory  condition,  it  was  a  fundamental  principle 
applicable  to  all  contracts  of  insurance  and  this  principle  of 
law  now  embodied  in  condition  one  of  the  B.  C.  Statutes 
requires  that  the  insured  makes  a  full  disclosure  of  all 
facts  and  circumstances  within  his  knowledge  material  to 
be  made  known  to  the  company  to  enable  it  to  judge  of  the 
risk  it  undertakes.  Statutory  condition  1,  however,  is  limited 
in  its  application  'to  the  property  in  regard  to  which  the 
misrepresentation  is  made,'  but  a  misrepresentation  might 
affect  all  the  property  insured,  as  for  example,  where  in 
the  application  the  insured  was  asked  whether  an  incendiary 
danger  to  the  property  was  threatened  or  apprehended,  and 
untruly  answered  'No,'  it  was  held  that  the  policy  was  void. 

"In  an  action  under  a  policy  the   defendant  insurance 


company  pleaded  that  in  the  application  for  insurance,  plain- 
tiff represented  that  the  property  to  be  insured  was  mort- 
gaged and  the  amount  of  such  mortgage  was  $900.00,  where- 
as the  amount  of  the  mortgage  was  a  greater  sum.  It  was 
held  that  the  plea  was  bad  for  not  alleging  that  the  mis- 
representation was  material. 

"In  another  case,  a  threat  made  four  months  before  in- 
surance was  effected,  that  certain  persons  would  burn  the 
store  of  the  insured  in  a  certain  contingency  (which  never 
occurred  and  which  threat  moreover  was  not  shown  to  have 
any  connection  with  the  fire)  it  was  held  not  a  circumstance 
material  to  be  made  known  to  the  assurer. 
Examples  of  Fraud 

Mr.  Shallcross  then  cited  two  other  cases,  among  which 
the  question  to  the  applicant  were:  "Have  you  ever  had  any 
property  destroyed  by  fire?"  The  answerer  only  admitted 
one  fire,  whereas  in  each  case  three  fires  were  proved  to  have 
occurred,  and  in  both  cases,  it  was  held  that  in  accordance 
with  Statutory  Condition  1,  the  assured  was  precluded  from 
recovery  under  the  policy. 

"In  another  case,  the  plaintiff,  in  his  application  to  in- 
sure a  building,  stated  that  it  was  owned  by  himself  and 
another,  and  worked  by  them  as  a  mill.  At  the  time,  the 
mill  was  in  the  possession  of  a  tenant  under  a  lease  for  five 
years,  was  mortgaged  to  its  full  value,  and  a  line  of  railway 
had  been  laid  out  through  the  land  for  which  the  plaintiff 
claimed  damages,  alleging  that  it  destroyed  the  mill.  There 
being  nothing  in  the  policy  requiring  such  matters  to  be 
disclosed,  it  was  left  to  the  jury  and  they  found  that  the 
non-disclosure  was  not  material.  Held  that  these  questions 
were  properly  left. 

"In  another  case,  a  person  seeking  to  effect  an  insurance 
gave  answers  to  the  following  questions: — 'Are  the  premises 
occupied  by  owner  or  tenant?'  Ans.  'By  tenant,  as  boarding 
house.'  '(2)  'If  occupied  by  tenant,  give  name  of  oymer?' 
Ans.  'The  applicant.' 

"In  fact,  the  applicant  did  not  own  the  land,  having  a 
lease  of  it  which  had  only  a  short  time  to  run,  with  the 
right  to  remove  the  building,  the  subject  of  insurance.  It 
was  held  that  this  was  such  a  misrepresentation  of  the  in- 
terest of  the  applicant  as  rendered  the  policy  void  under  the 
first  of  the  statutory  conditions  in  the  policy.  But  material 
misrepresentation  does  not  need  to  be  fraudulent  in  order  to 
make  void  a  policy  in  respect  to  the  property  in  regard  to 
which  the  misrepresentation  is  made. 

"In  an  application  for  insurance  on  a  building,  the  ap- 
plicant gave  its  estimated  cash  value  as  $900  and  obtained 
an  insurance  for  $600.  At  the  trial,  it  was  found  that  the 
cash  value  was  $450,  but  that  the  plaintiff's  estimate  was 
made  in  good  faith  and  that  he  had  not  been  guilty  of  any 
fraud  or  misrepresentation.  It  was,  however,  held  that, 
under  the  first  statutory  condition,  it  was  immaterial 
v/hether  a  representation  of  any  fact  material  to  be  known 
to  the  insurance  company  to  enable  it  to  judge  of  the  risk, 
was  falsely  (that  is,  untrue  to  the  knowledge  of  the  person 
making  it)  or  fraudulently  made,  so  long  as  it  was  in  fact 
untrue;  and  that  the  question  of  value  being  such  a  material 
fact,  the  court  held  that  the  policy  was  void. 

"In  another  case,  it  was  held  over-valuation  was  material 
and  that  under  the  First  Statutory  Condition  of  the  policy 
it  rendered  the  policy  void. 

"Whilst  misrepresentation  only  vitiates  the  contract 
when  material,  it  is  otherwise  when  made  with  intent  to  de- 
ceive, and  in  the  latter  case  no  matter  how  trivial  to  the 
risk,  such  fraudulent  misrepresentation  voids  the  policy." 

In  addition  to  the  above,  Mr.  Shallcross  referred  to  the 
preamble  to  the  "Act  to  Secure  Uniform  Conditions  in  Poli- 
cies of  Fire  Insurance"  chapter  37,  assented  to  29th  of 
March,  1919,  and  called  attention  to  the  provisions  therein 
made  for  the  way  "variations  in  conditions"  should  be 
shown  and  he  also  pointed  out  that  the  preamble  provided 
that  the  term  "contract"  means  and  includes  any  contract 
or  agreement,  sealed,  written  or  oral,  the  subject  matter  of 
which  relates  to  fire  insurance,  and  that  the  statutory  con- 
ditions were  deemed  to  be  part  of  every  contract.  He  also 
cited  various  cases  dealing  with  statutory  conditions. 


January  6,  1922. 


THE      MONETARY      TIMES 


183 


The  Monarch  Life  Assurance 

Company 


Head   Office 


WINNIPEG 


RECORD  OF  GROWTH 

Assurance  in  Force. 

1909 $2,213,266 

1911 4,006,145 

1913 6,762,506 

1915 7,747,835 

1917 11,507,761 

^^^-^^^-  J^'  ^^^^ ••  .-20,129,349 

t^-^^s^     ""^^  1921 over  29,000,000 

SECURITY  —  SERVICE  —  SATISFACTION 

W.  A.  MATHESON,  F.  W.  ADAMS, 

President  Vice-President. 

J.  W.  W.  STEWART,  J.  A.  MACFARLANE,  A.I.A. 

Managing  Director.  Secretary  and  Actuary. 


The  Mutual  Life  and  Citizens' 

Assurance  Company  Limited  (of  Australia) 

STRENGTH 

Seventy-five  per  cent,  of  the  total  assets,  which  exceed  $80,000,000,  are  held  in 
Government  seciu'ities — the  best  security  in  the  world.  The  valuation  of  liabilities 
is  made  on  a  basis  stronger  than  required  by  the  Canadian  Insurance  Department. 

ECONOMY 

A  guarantee  is  printed  on  each  Ordinary  Branch  policy,  that  the  expenses  shall 
not  exceed  fifteen  per  cent,  of  the  income  of  that  Branch.     For  the  year  1920   the 
.    actual  expense  rate  in  the  Ordinary  Branch  was  13.7  per  cent,  of  the  premiuma — 
well  withiu  the  margin. 

BONUSES 

"Stone  &  Cox  Tables"  says  (page  90) :—" This  company  is  probably  the  best 
bonus-paying  life  insurance  company  in  the  world  in  the  sense  that  its  dividends 
are  (piite  exceptioual.  These  dividends  are  due.  amongst  other  things,  to  the  most 
rigid  economy."  Bonuses  are  declared  annuallv.  For  1920  they  ranged  as  high  as 
$30.00  per  $1,000.00. 

Offices  in  Montreal,  Toronto,  Winnipeg 

J.  P.  MOORE,  A.I.A.  W.  B.  ROBINSON, 

Secretary.  Agency  Supervisor 


184 


THE      MONETARY      TIMES 


Volume  68. 


AUTOMOBIIiE  INSURANCE  EXPERIENCE  IN  1921 


Volume  of  Business  Fell  Off,  While  Losses  Were  Abnormally 
Heavy  During  Past  Tear 


THIS  form  of  insurance  is  usually  grouped  under 
these  headings  :  Liability,  Property  Damage,  Col- 
lision, Fire,  Theft,  Hail,  Tornado,  etc.,  and  Accidental 
and  External  Discharge  or  Lealiage  of  Water;  but  the 
greatest  risks  to  the  automobile  owner  are  personal  lia- 
bility and  theft.  The  operation  of  an  automobile  involves 
an  ever-present  legal,  as  well  as  moral,  responsibility  ; 
the  owner  is  liable  not  only  it  he  personally  kills  or 
injures  other  persons  or  damages  property,  but  he  may 
be  iable  for  the  acts  or  negligence  of  any  person  driving 
his  car,  and  serious  accidents  are  often  caused  by  the 
mistakes  or  carelessness  of  other  drivers  than  his  own, 
or  himself,  when  driving  his  own  car.  Owners  can  insure 
themselves  against  practically  every  risk  of  owning  or 
operating  motor  cars,  for  the  companies  are  numerous 
and  the  competition  for  business  excessively  keen.  Poli- 
cies are  varied,  as  in  other  kinds  of  insurance,  covering 
all  losses  arising  from  collision,  thefts  of  cars,  property 
damages,  fire  from  any  cause,  explosing  or  lightning, 
sinking  or  derailment  while  in  transit  by  water  or  rail. 
Special  forms  of  policies  are  issued  for  motor  cars  and 
trucks  in  the  hands  of  auto  dealers.  Similar  policies  are 
issued   for  the   insurance   of  motorcycles. 

1021  Business 

There  are  two  great  outstanding  facts  regarding  the 
business  of  1921  :  First,  that  many  companies  show  a 
falling  off  in  the  increased  volume  of  business  compared 
with  1920,  owing  to  the  world-wide  depression  in  trade, 
and.  second,  that  losses  have  In  most  cases  been  abnor- 
mally heavy,  arising  chiefly  from  theft,  and  also  from 
lire.  This  branch  of  the  business  is  somewhat  modern, 
hence  the  moral  hazard  is  proverbially  low;  the  com- 
panies deplore  the  inconsistency  of  competition,  which  Is 
largely  responsible  for  the  generally  unfavorable  exper- 
ience. J.  H.  King,  secretary  of  the  Canadian  Automobile 
Underwriters'  Association,  states  that  the  great  number 
of  thefts  this  year  were  due  not  only  to  the  bad  moral 
hazard,  but  to  the  bad  moral  conditions  of  the  commun- 
ities as  well.  The  purchase  of  cars  through  the  aid  of 
finance  corporations  made  it  possible  for  numerous  parties 
to  secure  cars,  when  financially  speaking  they  should 
never  have  had  cars.  Fire  losses,  Mr.  King  said,  were  more 
directly  attributable  to  post-war  conditions,  especially 
the  need  of  money,  which,  together  with  competition, 
caused  a  great  reduction  in  prices,  which  fell  to  consid- 
erably below  the  amounts  of  insurance,  thus  providing 
a  temptation  to  owners  to  become  careless  and  indiffer- 
ent regarding  their  machines.  In  fact,  evidence  has  not 
been  lacking  in  Western  Ontario  and  in  Eastern  Canada, 
it  is  reported,  that  owners  were  to  some  extent  accom- 
plices in  the  destruction  of  cars.  While  for  lack  of  state- 
ments the  comparative  figure  tor  1920  and  19  21  cannot 
be  given,  the  feeling  is  that  the  increase  in  total  volume 
of  business  will  not  be  as  large  as  last  year.  A  fair  idea 
of  the  situation  may  be  gleaned  from  the  following  brief 
reports  of  the  automobile  department  of  their  businesses 
by  several  of  the  larger  well-known  companies  with 
offices   in   Toronto  : 

C.  A.  Withers,  general  manager  of  the  Dominion  of 
Canada  Guarantee  &  Accident  Co.,  reported  that  for  ten 
months  of  this  year  their^  automobile  business  showed 
an  increase  of  about  12  per  cent,  with  a  loss  ratio  much 
more  favorable  than  in  1920. 

E.  Willans,  general  manager.  Imperial  Guarantee  & 
Accident  Co.,  reported  a  large  increase  of  business,  with 
about  the  same  percentage  of  liability  claims  to.'  accidents 
as  last  year,  but  the  claims  for  fire  and  theft,  especially 
theft,   showed   a   considerable   higher   percentage. 

W.  A.  Barrington,  assistant  manager,  the  General 
Accident  Assurance   Co.   of  Canada,    characterized   the  first 


ten  months  of  1921  of  the  company's  entire  business  as 
quite  fair.  "In  our  casualty  lines  we  have  increased  our 
premium  receipts  over  the  amount  for  ten  months  of 
1920  by  $100,000.  No  doubt,  like  all  other  companies, 
we  have  felt  the  influence  of  the  depression  in  general 
business  conditions,  but  by  putting  forth  extra  efforts  we 
have  been  able  to  make  about  the  usual  progress,  and 
have  not  retrograded.  Of  course  our  total  losses  show 
an  increase,  including  automobile,  fires  and  theft,  over 
last  year,  of  ?89,000,  but  our  total  receipts  tor  casualty 
premiums  foot  up  an  increase  of  about  $100,000."  We 
are  indebted  to  J.  S.  Lowther  of  this  leading  Canadian 
Accident  Company,  for  a  complete  table  of  premiums  and 
losses  for  the  ten  months  ending  on  October  31st  last, 
compared  with  the  like  period  of  1920.  The  total  of 
premiums  received  for  casualty  insurance  in  that  period 
was  $583,651.11  (chiefly  for  accident  and  health  guar- 
antee and  the  different  kinds  of  auto  insurance) ,  against 
$483,779.34  in  1920,  while  the  ten  months'  losses  footed 
up    $261,299.94   in    1921,    against    $172,014.89   in    1920. 

The  London  and  Lancashire  Guarantee  &  Accident 
Co.  of  Canada,  through  Alex  MacLean,  manager  and 
secretary,  reports  that  "premiums  have  been  fairly  well 
maintained  during  the  past  ten  months  to  1st  November, 
1921,  and  show  a  fair  increase  as  compared  with  1920; 
and  the  total  of  losses  for  the  same  period  show  a  con- 
siderable reduction,  owing,  probably,  to  the  absence  of 
the  epidemics  which  the  casualty  companies  had  to  face 
during  the  previous  two  winters.  If  the  business  con- 
tinues normal  till  the  end  of  the  year  we  will  have 
every  reason  to  be  satisfied  with  the  results  for  1921. 
Prospcets  for  another  fairly  good  year  seem  very  satis- 
factory." 

Alfred  Wright,  president  of  this  company,  whose 
remarks  on  the  general  business  of  the  company  are 
given  elsewhere,  stated  that  the  losses  from  automobile 
thefts  and  destruction  had  been  far  too  high.  More  care 
should  be  given  to  the  moral  hazard  and  to  the  hand- 
ling of  this  class  of  risks  generally." 

The  unusually  heavy  losses  last  year,  due  so  largely  to 
theft  of  and  damages  to  cars,  was  something  that  could  not 
be  foreseen,  and  the  companies  as  a  whole  will  consider  them- 
selves lucky  if  they  find,  after  the  year  closed  on  December 
31st,  that  the  average  total  of  premium  receipts  equalled 
those  for  1920.  The  lack  of  complete  uniformity  of  action 
in  valuing  risks  and  issuing  policies  is  deplored  by  the 
larger,  more  re.sponsible  companies,  some  of  whom  purposely 
caused  a  material  reduction  in  their  premium  incomes  rather 
than  take  the  chances  on  some  classes  of  risks  offered.  Ac- 
cordingly, the  sum  of  their  claims  for  last  year  show  a 
favorable  loss  ratio.  The  local  manager  of  a  couple  of  promi 
nent  British  companies  expressed  his  strong  conviction  th..t 
legislation  should  be  secured  to  make  the  safe  insurance  of 
cars  compulsory — in  the  interests  of  the  general  public. 


DriiL   YEAR   IN   E.YPLOSION   INSURANCE 


THIS  is  a  comparatively  new  department  of  insurance 
in  Canada.  There  are  two  forms  of  explosion 
policies  written,  one  covering  losses  from  explosion  of 
natural  gas  and  the  other  kinds,  such  as  boml)s,  etc., 
resulting  in  the  loss  of  buildings,  machinery  and  stock; 
the  other  affording  protection  against  the  loss  of  profits 
caused  by  the  destruction  of  buildings  or  stoppage  of 
machinery.  This  last  named  coverage  is  known  as  "Use 
and  Occupancy"  Insurance.  Explosions  caused  by  the 
bursting  of  boilers  and  flywheels  do  not  come  under  this 
department,  but  are  separate  and  distinct,  under  the  head 
of   "Steam    Boiler   Insurance." 

The  demand  for  "Explosion  Insurance"  was  actuated 
by  the  late  war,  and  since  its  close  has  been  slowly  but 
steadily  increasing.  There  are  not  many  companies 
engaged  in  this  branch  as  yet,  and  although  the  total 
volume  was  necessarily  small,  owing  to  the  absence  of 
"strikes,  riots  and  civil  commotions,"  such  as  the  notable 
strike  and  revolution  in  Winnpeg  in  119,  business  for 
1921  is  reported  to  .have  been  fairly  good,  with  a  favorable 
loss  ratio. 


January   6,   1922. 


THE      MONETARY      TIMES 


185 


rNCORPORATED    1859 


uf  Amfrira. 

HEAD  OFFICE: 
709-717  Sixth  Ave.  -         New  York 


Charles  H.  Coates 


President 


Capital  Paid  Up   $1,000,000.00 

Totai  Assets  12,071,029.44 

Net  Surplus 3,505,957.42 

Surplus  to  Policyholders 4,505,967.42 

Losses  paid  since  organization. .  .49,594,688.09 

Canadian  Department: 
130  SPARKS    STREET     -     OTTAWA 
E.  H.  HORNBOSTEL  -  Manager 


\umj6€(/raAicjL 


A.  F.   PEARSON    &   COY. 

Reinsurance  Brokers 
25  Birchin  Lane  -  Lendoa,  EX.  3 

Manasei^R.    M.    MACLAREN 

SecreUry— ROBT.    W.    REID 

Mgr.  Treaty  Dept.— W.  R.   BEAVIS 

Canadian  Manasrei^H.  MARSHALL  ROBERTSON 

Directors: 
A.    RENDTORFF  FREDK.   SUITH 

OFFICES: 
LONDON— (Uewl  Offic*)     -     25,  Birchin   Lane.  B.C  I 

LIVERPOOL IS   SwccUnc  St. 

NEW  YORK  ....         27   William    St. 

Cable   Addresa — "Osteriinffa,    London" 


iiiuiiiiiiiiiiiiniiininiiiiEi' 


Mount  Royal 
Assurance  Company 


Surplus  Reserve 
Total   Funds 
Total   Annual   Income 
Total  Losses  Paid 


$1,416,740.57 
$1,708,120.67 
$1,100,284.35 
$3,180,308.63 


Head  Office  :  17  St.  John  Street 

MONTREAL 


Toronto  Office 


84  King  Street  East 


P.  J.  Perrin,  General  Manager. 
H.  C.  Bourne,  Supt.  Western  Dept. 
H.  H.  York,  Inspector  for  Ontario. 


Shaw  &  BegK.  I-iniited,  Tordiito,  Ont.;  C.  H.  McFadyen 
&  Co.,  Ltd.,  Winnipeg,  Man. ;  Butk-r  Byers  Bros,  Ltd., 
Saskatoon,  Susk.  ;  J  O.  Miller  Insurance  .Agencies,  Ltd., 
Calgary,  Alta.;  Holison  &  Co.,  Ltd..  Vancouver,  B.C.; 
Duck  &  Johnston,  Victoria,  B.C. ;  (entral  Agencies.  Ltd.. 
Truro,  N.S. ;  Machum  &  Foster,  St.  John,  N.B. 

Applications  for  Agencies  in  Unrepresented  Districts  Invitrd 


The 


Provident 

Assurance  Company 

FIRE  and  CASUALTY 

Applications    for    Agencies    are    Invited. 


HEAD  OFFICE: 

CANADA    LIFE     BUILDING 
189  St.  James  St.      -      Montreal 

ONTARIO  OFFICE: 

C.P.R.    BUILDING,    TORONTO 

.\.  M.  .\lletter       -        -        Provincial  Manafler 


186 


THE      MONETARY      TIMES 


Volume  68. 


ACCIDENT  AND  HEALTH  INSURANCE 


Experience   of  the   Companies   Doing  ■  Business   in   Canada 
Varied  in  1921 


IT  MAY  not  be  particualrly  known  that  accident  and 
health  insurance  are  now  written  In  the  same  con- 
tract in  Canada.  After  the  larger  companies  of  the 
United  States  had  for  many  years  vainly  endeavored  to 
secure  this  desideratum  for  both  countries,  the  Canadian 
Managers'  Association  succeeded  in  agreeing  upon  a 
standard  contract  for  Canada— much  to  the  surprise  of 
the  U.  S.  companies — and  which,  we  are  informed,  has 
come  to  stay.  The  new  contract  form  applies  only  to 
the  new  business  written  since  its  adoption,  not  to 
renewals,  and  one  or  two  companies,  taking  exception  to 
this  feature,  have  not  yet  signed  the  agreement.  This 
objection  has  been  answered,  however,  and  it  is  believed 
will  soon  be  overcome,  just  as  the  increase  of  rate  for 
sickness  insurance,  inaugurated  by  the  London  and  Guar- 
antee Insurance  Co.  in  January  ,  1920,  as  a  remedial- 
measure,  has  since  been  followed  by  the  majority  of 
oompetjng    companies. 

By  sickness  insurance  is  meant,  that  for  a  premium 
of  $9.00  a  year  a  policy  holder  will  be  paid  the  sum  of 
$5.00  a  week  or  the  equivalent — viz.,  for  $45.00  a  year 
he  will  be  paid  $25.00  a  week  during  sickness.  No  medi- 
cal examination  is  required,  the  company  relying  solely 
upon  the  doctor's  certificate,  at  the  same  time  paying  all 
liospital  and  doctor's  fees.  The  time  limit  is  fifty-two 
weeks. 

Amounts  of  Coverage 

Policies  may  be  had  In  various  amounts,  and  provid- 
ing lump  sum  payments  for  specific  injuries  or  loss  of 
members  of  the  body  by  accident;  the  amounts  of  such 
payments  is  often  controlled  by  the  principal  sum  of  the 
policy  and  the  size  of  the  premium.  Some  companies 
offer  double  payments  of  principal  lump  sums  and  weekly 
indemnities,  in  case  of  injuries  as  a  result  of  railroad, 
steamship,  trolley,  elevator  or  other  kind  of  accident  ; 
also  for  accidental  death.  Some  policies  may  contain 
accumulative  features,  increasing  from  year  to  year  in 
benefits  of  50  per  cent,  more  than  the  original  principal 
sum  specified  in  case  of  accidental  death,  with  no  increase 
of  cost  to  the  insured.  These  policies  are  issued  for  sums 
of  from  $1,000  up  to  $50,000.  While  it  is  true  of  all 
kinds  of  insurance,  that  the  reputation  of  the  company 
for  prompt  settlement  is  usually  as  imuortant  as  the  pro- 
visions of  the  policy,  this  is  particularly  true  of  accident 
and   health  insurance. 

Ability  to  work  is  the  average  man's  largest  asset, 
and  everyone  who  has  dependents  should  protect  himself 
from  financial  loss  due  to  accidental  death,  injury  or 
illness.  No  policy  is  issued  providing  for  a  weekly  in- 
demnity greater  than  the  weekly  income  of  the  person 
insured.  When  the  insured  is  accidentally  killed  pay- 
ments are  made  to  the  beneficiary  named  by  the  insured; 
the  beneficiary  may  be  either  a  member  of  the  insured's 
family,  or  a  business  associate,  partner  or  member  of  a 
company,  etc.  The  latter  form  of  protection  is  becoming 
very  popular,  where  the  disability  of  one  member  of  a 
partnership  or  firm  might  prove  a  serious  handicap. 
Experience  in  1921  ' 

The  Dominion  Guarantee  &  Accident  Insurance  Co. 
state  that  their  accident  and  sickness  business  has 
increased  during  1921,  while  the  claims  for  the  same 
department  foot  up  a  smaller  total  than  in  1920.  H.  A. 
Laurence,  Ontario  manager  for  the  Travelers'  Insurance 
Co.,  of  Hartford,  reports  thei  business  in  his  depatment 
as  showing  a  good  increaes  during  1921,  but  the  total 
volume  for  the  ten  months  was  not  as  great  as  in  the 
previous  year.  Mr.  Laurence,  however,  expected  to  make 
don  Guarantee  &  Accident  Insurance  Co.  report  an 
up  the  deficiency  before  the  31st  of  December.  The  Lon- 
increased   volume   of   accident   and  sickness   insurance,   as 


compared  with  1920,  with  losses  heavier,  so  far  as  known, 
than    in    the   previous   year. 

The  year  for  "Personal  Accident  and  Sickness"  insurance 
was  generally  satisfactory,  so  far  as  the  continued  demand 
for  it  is  concerned,  the  premiums  showing  an  increase  with 
some  large  companies  as  compared  with  1920,  but  the  losses 
were  generally  heavy,  although  varying;  some  companies 
experienced  a  larger  volume  of  business,  with  losses  smaller 
than  in  1920  in  sickness  insurance  than  others,  while  the 
reverse  was  true  in  the  accident  branch.  The  Employers' 
Liability  Corporation  report  their  sickness  claims  becoming 
heavier  every  year.  The  General  Accident  Assurance  Co.  of 
Canada  reported  a  small  increase  of  premiums  for  1921 
against  those  for  1920,  and  a  fair  reduction  in  the  total  of 
claims  compared  with  1920. 


STEAM  BOELEB  INSURANCE  REDUCED 


Ne^y  Business  in  1921  Was  Lower  Than  in  the  Preceding 
Year — Importance  of  Inspection  Work 

IN  THIS  department  of  insurance,  business  on  the  whole 
seems  to  have  consid^ably  increased  during  the 
year,  as  it  is  found  to  be  more  and  more  necessary.  The 
loss  ratio  was  favorable,  but  it  must  be  remembered  that 
this  is  at  least  important  feature  of  the  business.  Actual 
losses  are  never  large,  only  about  8  per  cent,  being  con- 
templated, when  regular  inspection  is  faithfully  made. 
It  is  the  service  maintenance  and  cost  of  inspection  that 
is  the  bugbear,  as  for  every  singe  one  explosion  among 
boilers,  regularly  and  properly  inspected,  there  are  eighteen 
explosions  on  the  average  among  those  not  inspected. 
Altogether  the  year  closed  fairly  satisfactory  to  most  of 
the  companies   writing   this   class   of   protection. 

"Boiler  Insurance"  contracts  practically  cover  a  three 
years'  business,  so  that  a  yearly  comparison  of  results 
cannot  be  made,  and  is  out  of  the  question  tor  this 
review. 

The  General  Accident  Assurance  Company  of  Canada 
write  Boiler  Insurance  policies,  and  report  a  falling  off  tn 
business  for  the  ten  months  of  1921,  with  claims  much 
heavier  than  last  year.  The  figures  for  premiums  are  : 
1921 — $35,014.69,  against  $43,359.70  tor  1920;  and 
claims   totalled   $7,799.31   and   $1,053.75,   respectively. 


GOOD  VOLUME  OF  PLATE  GLASS  INSURANCE 


Business    is    Reported    Higher,    With    Tendency    Towards 
More  Mo<lerate  Losses 

THIS  lorm  of  indemnity  guarantees  to  policyholders 
the  replacement  of  glass  broken  through  accidental 
causes  beyond  the  insured's  control.  The  rates  are  based 
on  the  size  of  the  glass,  and  are  considerably  lower  when 
the  glass  is  above  the  first  floor.  The  company  usually 
pays  the  loss  in  cash,  or  replaces  the  glass  without  cost 
to    the   insured. 

The  Dominion  of  Canada  Guarantee  &  Accident  Co. 
report  a  thirty  per  cent,  increase  in  the  volume  of  their 
plate  glass  business  tor  the  ten  months  ending  the  31st 
of  October  last,  as  compared  with  the  like  period  last 
year,  and  their  loss  ratio  is  said  to  be  much  more  fav- 
orable than  in  1920.  Notwithstanding  that  these  figures 
are  favorable,  this  large  company  acknowledges  that  the 
general  business  depression  has  materially  affected  the 
year's  total  results,  especially  in  the  West,  where  they 
have   so   far   managed  to   hold   their   own. 

The  Imperial  Guarantee  &  Accident  Co.,  Toronto, 
report  a  small  increase  in  the  volume  of  business  and  pre- 
mium receipts  tor  this  department  of  their  business,  as 
compared  with  the  first  ten  months  of  1920,  while  the 
claims  this  year  are  reported  to  be  a  little  less  in  volume 
than   last  year. 

The  London  Guarantee  &  Accident  Insurance  Co. 
report  a  fair  demand  for  plate  glass  insurance  during 
the  year,  with  losses  about  the  same  as  in  the  previous 
year,  and  premiums  showed  a  fair  increase  for  the  ten 
months,  as  compared  with  1920. 


January   6,   1922. 


THE      MONETARY      TIMES 


187 


The 


Wawanesa  Mutual  Insurance  Company 


Head  Office 


WAWANESA,  MAN. 


Owned  and  Operated  by  the  Farmers  in  Manitoba,  Saskatchewan,  Alberta  and  British 

Columbia  for  their  Mutual  Benefit. 

Progress  Since  Organization, — 


fear  Insurance  in  Force 

1W)7 366,816.00 

]900 4,419,459.00 

1905   14.542.525.00 

1910 27,869,677.00 

1915 48,075,289.00 

1920 93,139,456.00 

1921,  Dec.  1st,  over 98,500,000.00 


Losses  paid  since 

Orjranization   $1,480,000.00 

Assets  over 1,900,000.00 

Cash  Surplus  over 300,000.00 

Policies  in  Force  42.300 


The  Largest  and  Strongest  Farmers'  Mutual  Fire  Insurance  Company  in   Canada, 

insuring  Farm  Property  only. 

Agents  in  all  Localities. 

This  Company  has  no  connection  with  The  Western  Canada  Mutual  Fire  Insurance 
Association,  or  any  other  combination  of  Mutual  Companies. 

S.  H.  HENDERSON,  A.  F    Kemiton.  E.  H.  DEWART, 

President.  Secretary-Treasurer.  Vice-President. 


Chas.  S    Blackwell, 

President 


A.  W.  East  mure, 

Managing  Director 


I3l)e  Art  of  (BlassmaKing 
was    discovered 
bip  tl)eTE9YPti<^^5 

In  its  many  and  varied  forms  this  wonderful 
substance  ranks  with  the  most  beautiful  and 
useful  of  all  inventions.  Yet  there  is  probably 
no  other  article  of  commerce  in  equal  demand 
and  of  approximate  value  which  is  subject  to 
so  many  risks. 

IT  IS  INDISPENSABLE  IT  IS  COSTLY 

IT  WILL  BREAK 

Ol)e(ra5ualt^ 

(Eomp anp  of  (Lanaba 


Head  Office 


Toronto 


"Jnsure*  "plate  (Blass  of  every  6escriftion 
"^^^alnst  "^ccl^cntal  breakage 


The  Independent 
Order  of  Foresters 


Organized  1874 


Total  Benefits 

Paid  to  ilembers  and  their  Beneficiaries 

$74,000,000.00 


STANDARD  POLICY— OLD  AGE  AND 

DIS.yJILITY  FEATURKS 
LIFE— 20  PAY:MENT 

LIFE— 20  PAYMENT  WITH  DISABILITY 
OLD  AGE  CERTIFICATE— 100%    DISABIL- 
ITY and  100%  OLD  AGE  BENTFIT. 

Policies  Issued  from  S1,000  to  .So,000 

GEO.  K.  BAILEY;  W.  H.  HUNTER, 

Secretary.  President 

Q.  B.  COTTRELLK 
Treasurer. 


188 


THE      MONETARY      TIMES 


Volume  6&. 


LIGHTER   YEAR   IN  TORNADO    INSURANCE 


LIFE  BUSINESS  WAS  WELL  MAINTAINED 


Both     Premium     Income     and     Losses     Are     Reported     as 
Decreased   in    ('oniparison    With    1920 


TORNADO  Insurance  gives  policyholders  full  protec- 
tion trom  cyclones  and  tornadoes,  and  any  damage 
caused  by  wind.  A  wind  storm  may  not  assume  the  force 
of  a  tornado  or  cyclone,  yet  it  unroofs  houses,  tips  over 
barns  and  other  out-buildings,  and  often  does  great 
damage  to  stores  and/  warehouses,  churches  and  other 
public  buildings,  and  contents.  Few  countries  are  absol- 
utely immune  from  the  tornadoes,  and  the  property 
damages  reach  an  enormous  total  every  year,  especially 
in  the  United  States.  During  1913,  in  a  period  of  only 
two  weeks,  the  damages  from  tornadoes  stretching  from 
Nebraska  and  Ohio  to  Texas  and  Georgia,  amounted  to 
$20,000,000.  The  rates  for  this  form  of  insurance  natur- 
ally vary,  according  to  localities,  but  are  reported  quite 
moderate,  considering  the  protection  afforded  from  such 
devastating  storms. 

A  couple  of  years  ago,  about  the  1st  of  December, 
1919,  Ontario  was  visited  by  a  most  severe  wind  storm, 
and  the  damage  resulting  was  quite  general  throughout 
the  province.  One  of  the  leadng  insurance  companies  in 
Canada  received  over  1,600  claims,  amounting  to  nearly 
$75,0,00,  for  damages  from  this  one  storm;  and  the  drain 
upon  the  finances  of  some  mutual  fire  companies  was 
reported  to  be  so  serious  as  to  even  threaten  their  con- 
tinuance in  business.  Consequently  the  losses  paid  in 
1920  proved  to  be  the  heaviest  experienced  for  several 
years, — but  1920  was  also  a  good  year  for  premium 
receipts, — the  demand  fro  mfarmers  (to  whom  this  class 
of  insurance  specially  appeals)  for  coverage  having  nat- 
urally increased  very  largely.  One  agent's  premium 
income  for  that  year  totalled  nearly  $75,000.  The  good 
crops  and  higher  prices  also  helped  to  promote  business 
in  this  Inei.  Durng  1921  Tornado  Insurance  continued 
quite  active  under  a  growing  demand  from  the  farmers 
and  others,  and  the  losses  were  smaller  in  the  aggregate 
than  for  1920.  The  premium  income  was  also  smaller 
than   in  the  previous  year. 


SPRINKLER  LEAKAGE   BUSINESS  QUIET 


Volume   of   New   Business   Less   Than   in    1920,   and   Some 
Companies  Have  Advanced  Tlieir  Rates 


SPRINKLER  systems  afford  one  of  the  best  known 
methods  of  fire  protection,  and  helps  the  policyholder 
by  securing  him  a  reduction  in  the  insurance  rate;  hence 
a  larger  number  of  property  owners  each  year  instal 
sprinkler  plants.  It  must  be  remembered,  however,  that 
with  the  best  of  sprinkler  systems,  there  is  always  danger 
of  damage  from  accidental  leakage;  a  very  small  break 
may  cause  a  deal  of  damage  to  valuable  stocks  of  goods, 
and  enormous  losses  have  been  caused  by  the  falling  of 
water  tanks.  Hence,  the  necessity  for  all  property-owners 
who  instal  this  system  to  protect  themselves  against  such 
possible  loss  by  insurance.  It  is  also  worth  remembering 
that  the  owners  of  buildings  equipped,  with  sprinkleft- 
systems  are  liable  for  any  damage  to  the  property  of  ten- 
ants caused  thereby.  In  addition  to  the  protection  afforded 
by  his  policy,  the  holder  in  the  case  of  large  companies, 
is  entitled  to  the  services  of  sprinkler  experts,  who  regu- 
larly inspect  risks  and  give  policyholders  advice  in  pre- 
venting accidents  and  making  any  changes  of  equipment 
which  may  permit  a  reduction  of  the  insurance  rates. 

Oftener  than  not  this  form  of  contract  is  written  for 
three  years,  and  when  contracts  expire  and  new  systems 
are  being  installed,  of  ocurse  there  is  more  business  written 
in  that  year.  This  was  the  exp'erience  during  1920,  but 
during  last  year  the  demand  fell  off,  consequently  business 
ruled  quiet  and  the  premium  income  for  1921  shows  a 
reduction.  Notwthstanding  that  competition  has  been 
quite  keen,  one  or  two  companies  with  offices  in  Toronto 
report  that  they  have  been  obliged  to  advance  their  rates. 


Prnice   Edward   Island  Underwriter  Points   Out   Tliat  Past 

Year  Was  Above  Normal — Previous  Years 

Were  Boom  Period 


IN  a  statement  to  The  Monetary  Times,  J.  K.  Ross,  pro- 
vincial manager  of  the  North  American  Life  Assurance 
Co.  for  Prince  Edward  Island,  and  president  of  the  Life 
Underwriters'  Association  there,  says: — 

"Life  insurance  in  Prince  Edward  Island  for  1921 
has  been  above  normal.  Certainly  we  have  felt  the  results 
of  low  prices  for  farmers'  produce  and  the  uncertainties  of 
the  long  drawn  out  election  campaign,  but  the  volume  of 
new  business  will  show  an  increase  over  last  year,  according 
to  the  reports  from  our  leading  companies  here.  It  is  quite 
true  that  1918  and  1919  were  boom  years  in  life  insurance 
owing  to  the  general  prosperity  and  high  wages. 
More  Selling  Effort  Required 

"It  takes  more  effort  to  sell  insurance  this  year  and 
better  salesmanship  is  required.  The  business  of  1921  will 
consist  of  larger  policies  and  premiums  will  be  more  per- 
manent as  the  better-off  class  of  people  have  recognized  the 
need  of  life  insurance  as  the  best  medium  for  increasing 
their  estates  and  protecting  their  invested  capital. 

"The  life  insurance  companies  have  merited  the  con- 
fidence of  the  public  by  their  prompt  and  full  settlement 
of  all  war  and  flu  claims.  They  have  stood  the  acid  test 
of  paying  enormously  increased  claims. 

"The  companies  are  now  devoting  their  attention  to 
liberating  their  contracts  and  are  prepared  to  meet  the  needs 
of  the  insuring  public  by  their  new  plans  of  insurance,  such 
as  monthly  income  policy,  deferred  annuities,  group  insur- 
ance, etc. 


TRAVELLERS'   MUTUAL  BENEFT  SOCIETY 


The  members  of  the  Dominion  Travellers'  Mutual  Benefit 
Society,  at  their  meeting  in  Montreal  on  Dec.  3,  under  the 
chairmanship  of  S.  S.  Woodward,  the  retiring  president, 
elected  by  acclamation  the  officers  for  the  ensuing  term  as 
follows:  President,  Wm.  Blanchard ;  vice-president,  J.  B. 
Cullens;  treasurer,  F.  S.  Cote   (re-elected). 

As  trustees  for  a  period  of  two  years,  the  following 
five  members  were  elected  by  acclamation:  John  G.  Watson, 
Chas.  Roberts,  J.  P.  Berthiaume,  Wm.  J.  Joyce  and  R.  E. 
Matthews.  These,  together  with  W.  N.  Ahern,  J.  A.  Quesnel, 
J.  Emile  Gratton,  E.  E.  Goodenough  and  Leslie  J.  Paterson, 
who  were  elected  last  year,  will  constitute  the  board  of 
management  for  the  year  1922. 

Charles  Roberts  gave  notice  of  a  motion  to  be  dealt  with 
at  the  annual  meeting  of  members  to  be  held  on  January 
14th  next.  The  %  object  of  the  motion,  as  presented,  is  to 
enable  members  of  class  "A,"  who  are  over  fifty  years  of 
age,  to  transfer  to  class  "B"  and  thereby  secure  the  maxi- 
mum amount  of  protection  provided  for  in  the  by-laws.  The 
motion  also  provides  for  the  payment  of  adequate  rates  by 
all  members  desirous  of  transferring  to  class  "B." 

The  retiring  president,  Mr.  S.  S.  Woodward,  dealt  with 
the  numerical  and  financial  strength  of  the  society  and  also 
made  reference  to  the  large  number  of  applications  for  mem- 
bership now  being  secured  by  the  secretary,  J.  F.  Garrett. 
He  stated  that  the  rates  now  in  force  were  moderate,  equit- 
able and  safe  and  appealed  to  every  member  to  help  in  the 
campaign  for  new  members. 


CANADIAN  LIFE   OFFICERS   ASSOCIATION 

At  the  annual  meeting  of  the  Canadian  Life  Officers 
Association  held  in  Toronto,  November  18th,  the  following 
officers  were  elected  for  the  year: 

J.   F.   Weston,  Imperial  Life — President. 

Arthur   Wood,   Sun   Life — Vice-President. 

D.    E.    Kilgour,    North    American    Life — Vice-President. 

T.  A.  Dark,  Excelsior  Life — Hon.  Secretary. 

It  was  decided  at  the  meeting  to  open  a  permanent 
office  of  the  Life  Officers  Association  in  Toronto. 


January  6,    1922  THBM0NETARYTIME8  1« 


EXCELSIOR 

LIFE    INSURANCE    COMPANY 

A    Strong  Canadian  Company  * 

ESTABLISHED  1889 

One  of  the  few  Companies  that  wrote  as  much  business  in  1921  as  in  1920 

POLICIES  ISSUED  WITH  OR  WITHOUT  MEDICAL  EXAMINATION 

Insurance  in  Force,  $47,000,000.00 

Head  Office  -  TORONTO,  CANADA 


ni 


The  unknown  needs  of  the  future 

The  man  of  vision  can  appreciate  the  value  of  a  life  insurance 
policy  that  may  be  adapted  to  meet  a  change  in  his  requirements. 

London  Life  "Canadian"  Series  Policies  contain  an  Interchange 
Privilege  which  permits  of  such  a  change  of  plan  by  means  of  a 
simple  adjustment  of  the  premium. 


Phone  our  Local  Agency,  or  write  direct  to 

The  London  Life  Insurance  Company 

HEAD  OFFICE,  -  LONDON,  CANADA 


190 


THE      MONETARY       TIMES 


Volume    08 


Uniform  Life  Insurance  Law  In  Canada 

How  the  Act  Just  Adopted  by  Commissioners  on  Uniformity  of 
Law  Was  Framed — No  One  Province  Taken  As  Pattern  for 
Legislation — An    Analysis    of    the    Model    Life    Insurzmce    Act 

BY  H.  J.  SIMS,  K.C.,  OF  SIMS,  BRAY  &  McINTOSH, 
WATERLOO,  ONT. 

(An  address  delivered  at  a  meeting  of  the  Provincial  Superintendents  of  Insurance.  Quebec,  October  6,  1921.) 


AT  your  last  meeting  held  a  year  ago  In  Winnipeg,  you 
kindly  listened  to  an  address  which  I  delivered  on 
the  subject  of  "Legislation  Respecting  Life  Insurance  Ben- 
eficiaries." In  that  address  my  purpose  was  to  point  out  the 
differences  existing  in  the  various  provincial  statutes  re- 
lating to  beneficiaries  and  to  accentuate  the  wisdom  of 
uniform  legislation  throughout  the  Dominion,  not  only 
in  respect  to  beneficiaries,  but  genei%,lly  on  the  whole  sub- 
ject of  life  insurance  contracts. 

I  am  very  pleased  to  state  that  since  your  last  meeting 
very  substantial  progress  has  been  made  along  the  lines  of 
uniformity.  The  trail  is  being  blazed  by  the  Insurance  De- 
partment of  the  Province  of  Ontario.  During  the  course  of 
revision  of  The  Ontario  Insurance  Act,  it  was  suggested 
that  a  Model  Act  should  be  prepared  respecting  Life  In- 
surance Contracts  which  might  be  adopted  not  only  by 
Ontario,  but  by  all  of  the  other  provinces  as  well.  TRis 
met  with  the  hearty  approval  of  the  Attorney-General  for 
pntario  as  well  as  the  Superintendent  of  Insurance  for 
that  province. 

Drafting  Model  Act 

Knowing  how  keenly  I  was  interested  in  the  subject 
of  uniformity,  it  was  arranged  between  the  Ontario  Su- 
perintendent and  the  Canadian  Life  Insurance  Officers' 
Association  that  the  task  of  drafting  a  Model  Act  should 
be  delegated  to  me.  I  undertook  the  work  cheerfully,  be- 
lieving that  if  conscientiously  done,  it  would  at  least  merit 
further  consideration  and  careful  study. 

I  was  ably  assisted  in  the  preparation  of  the  Act  by 
the  Superintendent  as  well  as  by  a  spe'ilal  committee  of 
the  Canadian  Life  Insurance  Officers'  Association.  Rep- 
resentatives appointed  ;  byr  the  Association  of  Canadian 
Fraternal  Societies  also  assisted  in  the  work.  The  solic- 
itor for  the  Association  of  American  Insurance  Presidents 
collaborated  as  well.  Useful  suggestions  were  also  made 
by  Dr.  F.  Sanderson,  F.I.A.,  F.A.S.,  retained  as  a  consulting 
actuary  by  the  Ontario  Government,  and  by  A.  M.  Dymond, 
K.G.,  Law  Clerk  to  the  Legislative  Assembly  of  the  Prov- 
ince of  Ontario.  Members  of  the  Ontario  Judiciary  also 
made  valuable  recommendations.  Furthermore  during 
the  progress  of  the  work  suggestions  were  asked  for  from 
all  of  the  Life  Insurance  Companies  doing  business  in  Can- 
ada. These  were  given  freely  and  many  of  them  were 
adopted.  Suffice  it  to  say  that  the  Model  Act  was  given 
careful  and  mature  thought  before  it  was  finally  drafted 
for  submission  to  the  Commissioners  on  Uniformity  of 
Legislation  in  Canada. 

Time  for  Consideration 

The  Commissioners  apparently  were  of  the  opinion 
that  the  subject  of  Uniform  Life  Insurance  Laws  through- 
out Canada  was  of  such  consequence  that  it  would  be  ex- 
pedient to  set  aside  a  whole  day  for  the  consideration  of 
the  Model  Act  at  their  conference  held  in  the  city  of  Ot- 
tawa last  month.  A  most  illuminating  and  instructive 
discussion  of  the  various  sections  of  the  Act  took  place 
and  the  Commissioners  commented  most  favorably  on  the 
thorough  manner  in  which  the  work  was  prepared  and 
placed  before  them.  The  Act  was  referred  to  the  Com- 
missioners from  Ontario  for  further  consideration  and  re- 
port to  the  next  conference  of  the  Commissioners  to  be 
held  a  year  hence.  This  is  the  course  pursued  in  all  cases 
where  draft  Acts  are  submitted  to  the  Commissioners  for 


the  first  time.  The  wisdom  of  this  course  is  self-evident. 
Every  possible  opportunity  should  be  given  for  a  thor- 
ough consideration  of  a  proposed  Model  Act  and  in  the 
opinion  of  the  Commissioners  at  least  a  year  should  be 
allowed  for  that  purpose.  Ill  digested  legislation  invar- 
iably leads  to  doubt  and  confusion,  and  frequently  to  liti- 
gation. Amendments  are  found  to  be  necessary  and  soon 
the  statutes  are  cluttered  with  a  jumble  of  Acts,  embar- 
rassing to  the  layman  and  interesting  to  the  lawyer. 

It  may  be  pointed  out  that  the  Commissioners  are  ap- 
pointed under  the  authority  of  the  statutes  of  the  various 
provinces.  Their  duty  is  to  aid  and  assist  the  local  gov- 
ernments in  co-ordinating  the  laws  of  the  provinces 
where  uniformity  is  desirable.  It  is  not  their  function  or 
duty  to  initiate  new  laws.  That  is  the  prerogative  of  the 
people  through  their  representatives  in  the  legislatures 
It  is,  however,  reasonable  to  believe  that  any  legislation 
recommended  by  the  Commissioners  would  be  adopted  by 
the  various  local  governments. 

A  Question  of  Contracts  Only 

You  will  no  doubt  expect  me  to  make  some  reference 
to  the  contents  of  the  Model  Act.  In  the  first  place  I  wish 
you  would  bear  in  mind  that  the  Act  only  deals  with  con- 
tracts of  life  insurance  and  the  rights  and  status  of  per- 
sons to  whom  insurapce  moneys  are  payable.  The  Act  does 
not  in  any  way  relate  to  the  incorporation,  licensing  and 
regulation  of  Insurance  companies. 

In  the  second  place  you  will  find  on  examination  that 
the  Insurance  Act  of  no  one  province  has  been  slavishly 
followed  In  the  preparation  of  the  Model  Act.  The  same 
fundamental  principles  run  through  all  of  the  Provincial 
Acts.  These  have  been  followed  and  form  the  major  part 
of  the  new  Act.  There  are  some  excellent  features  in  all 
of  the  present  Insurance  Acts.  They,  too,  have  been  adopt- 
ed. There  are  a  few  sections  which  cannot  be  found  in  any 
of  the  provincial  statutes.  It  is  believed  their  inclusion  Is 
justified  owing  to  the  methods,  practices  and  usages  pre- 
vailing today  in  the  business  of  life  insurance.  Those  sec- 
tions which  appear  most  frequently  in  the  various  Insur- 
ance Acts,  have,  as  a  rule,  been  incorporated  In  the  Model 
Act  so  as  to  cause  the  least  possible  amendment  to  the  law 
not  generally  prevailing. 

Again,  an  effort  has  been  made  to  arrange  the  con- 
tents under  proper  headings  and  with  suitable  marginal 
notes  so  that  anyone  interested  in  the  subject  can  readily 
and  quickly  follow  it.  This  can  hardly  be  said  of  any  of 
the  present  Insurance  Acts. 

It  may  not  be  amiss  to  briefly  refer  to  the  subject  matter 
of  the  Act  and  in  doing  so  I  shall  only  refer  to  the  sections 
as  they  are  grouped  under  their  respective  headings. 
Codification 

It  was  deemed  advisable  to  codify  some  of  the  general 
principles  relating  to  life  insurance  law  and  this  is  done  In 
12  sections  under  the  heading  of  General  Provisions.  The 
advantages  of  codification  are  patent  and  it  is  needless  to 
enlarge  on  them.  In  Quebec  a  considerable  part  of  the 
law  has  already  been  codified.  It  is  to  be  found  mainly 
in  the  Civil  Code.  The  articles  are  clear  and  concise  and 
most  of  them  have  been  introduced  into  the  Model  Act. 
What  Law  Governs? 

The  question  of  "What  Law  Governs?"  has  been  a  bug- 
bear,  particularly  in   respect  to  beneficiaries.      There  have 


January  6.  1922  THBMONETARYTIMES  191 


A  Business  Man 

in  acknowledging  settlement  of  his  recently  matured  policy  said: 

"I  wish  to  thank  your  Company  for  the  very  kind  treatment 
accorded  me  durinn;  the  term  of  my  policy,  and  I  am  highly 
pleased  with  the  results.  1  can  assure  you  I  am  glad  I  am  still 
quite  a  larjje  policyholder  in  the  Great-West  Ijife.  I  deem  it 
the  most  profjressive  Canadian  Life  Insurance  Company  on 
account  of  the  liberal  policy  conditions,  and  its  funds  being 
invested  in  Western  Farm  Mortgages  and  Bonds,  places  it  in 
the  position  to  pay  profits  to  its  policyholders  unequalled  by 
any  other  Company." 

There  are  scores  of  similar  letters  contained  in  the  booklet, 
"What  Others  Say."    Ask  for  a  copy. 

Our  motto:  "Service  to  Policyholders" 

The  Great  West  Life  Assurance  Company 

DEPT.  "E." 
Head  Office  -  -  Winnipeg 


THE 


Canada  National  Fire  Insurance  Company 

HEAD  OFFICE        -        WINNIPEG,  CANADA  " 

Authorized  Capital   $3,000,000  Subscribed  Capital  $2,050,400 

Paid-in-Capital $1,849,736  Assets  $2,702,853 

Surplus  to  Policyholders,  $2,193,151. 


BOARD  OF  DIRECTORS 

President  Vice-Presidents:  Managing  Director: 

J.  H.  G.  Kussell  W.  J.  Boyd,  F.  H.  Alexander  W.  T.  Alexander 

Directors : 

K.  L.  Taylor,  K.C.  Major  D.  E.  Sprague,  O.B.E.  Dr.  A.  D.  Carscalien  S.  D.  Lazier.      F.  N.  Darke,  Regina 

Andrew  Gray,  Victoria  Col.  The  Hon.  A.  C.  Rutherford,  K.C,  Edmonton  Thos.  S.  McPherson,  yictoria 


GENERAL  FIRE  INSURANCE  BUSINESS  TRANSACTED 


AGENCIES: 
TORONTO,  ONT.— Lyon  &  Knowland 
VICTORLA,  B.C.— R.  W.  Perry  EDMONTON,  Alta_Allan.  Killam.   McKay.  Grw-ne,  Ltd. 

VANCOl'VER,  B.C.— Bell  &  .^litcluH,   Ltd.,  Rogers  BIdg.REGINA,  Sask.— Bell  &  Mitchon  Ltd. 
CALGARY,  Alta.— The  Prairie  City  Agencies  Ltd.  SASKATOON.  Sask.— Trotter  &  Co. 

Crtneral  Agent— NOVA  SCOTLV— A.  J.  Bell  &  Co.,  HALIFAX. 
MONTREAL,   P.Q.— Permanent   Agencies   Ltd.  LONDON,  Eng.— H.  L'Estrange.  Malone. 


A    CANADIAN     COMPANY     INVESTING     ITS    FUNDS     IN     CANADA 


192 


THE       MONETARY       TIMES 


Volume    68 


been  conflicting  decisions  and  we  concluded  to  clear  up 
the  situation  by  legislation.  In  doing  so  we  have  .closely 
followed  the  sections  in  the  Nova  Scotia  and  New  Bruns- 
wick Acts  dealing  with  the  question. 

The  Statute  law  relating  to  Insurance  Interest  has  not 
been  satisfactory  in  a  number  of  the  provinces,  particu- 
larly in  Ontario  and  Saskatchewan.  There  is  no  legisla- 
tion in  Manitoba  dealing  with  the  subject.  The  law  in 
Quebec  and  Alberta  commended  itself  to  us  and  we  have 
in  substance  followed  their  sections  together  with  Sec.  1 
of  The  Gambling  Act,  14  Geo.  III.,  Chap.  14,  which  is 
to   be  found  in  the  British   Columbia  Act. 

Sees.  21  to  24  inclusive,  deal  with  days  of  grace,  in- 
contestability, terms  and  conditiohs  of  the  contract  and 
V  misstatement  of  age.  These  subjects  have  been  dealt  with 
for  many  years  by  most  of  the  provinces  with  the  excep- 
tion of  the  question  of  incontestability.  Similar  provfs- 
lons  are  to  be  found  in  the  Dominion  Act. 

The  Provincial  laws  respecting  insurance  vary  consid- 
erably and  Quebec  and  the  Maritime  Provinces  only  deal 
with  Industrial  insurance.  Manitoba  has  no  legislation 
on  the  subject  at  all.  It  was  concluded  to  follow  the  prin- 
ciple laid  down  in  the  law  of  British  Columbia  by  giving 
a  minor  over  the  age  of  15  full  power  to  effect  a  contract 
of  insurance  on  his  life  and  to  deal  with  it  as  effectually 
as  an  adult.  You  will  remember  that  in  Ontario,  Saskat- 
chewan and  Alberta  an  infant  over  15  is  only  permitted 
to  insure  his  life  in  favor  of  a  certain  class.  In  British 
Columbia  the  age  limit  is  16.  Many  are  of  the  opinion 
that  the  limit  should  be  16  instead  .of  15.  Some  of  the 
features  of  the  new  Massachusetts  Insurance  Act  respect- 
ing infant  insurance  have  been  adopted. 

Industrial  insurance  is  dealt  with  In  Sec.  26.  A 
Bligthly  increased  scale  has  been  provided  for  and  the 
condition  that  a  child  under  one  year  of  age  cannot  be 
insured  has  been  done  away  with. 
Beneflclarles 
The  important  branch  of  the  law  dealing  with  bene- 
ficiaries is  covered  by  Sees.  28  to  41  inclusive.  A  great 
deal  of  diversity  exists  at  present  in  local  legislation  and 
It  Is  the  consensus  of  opinion  that  in  any  event  the  various 
Provincial  Statutes  should  be  co-ordinated  and  made  uni- 
form on  this  subject.  In  doing  so,  it  had  been  consid- 
ered advisable  to  divide  beneficiaries  into  three  classes, 
namely.  Preferred  , Ordinary  and  For  Value.  This  divis- 
ion is  now  recognized  and  followed  in  practice  by  all  the 
life  companies.  The  idea  of  the  creation  of  a  trust  in 
favor  of  members  of  the  preferred  class  free  from  the 
claims  of  the  creditors  of  the  insured,  so  long  extant  in 
the  insurance  law  of  Canada,  has  been  preserved. 

The  Insurance  Acts  of  Ontario,  Saskatchewan,  Alberta, 
Nova  Scotia  and  Prince  Edward  Island,  provide  that  the 
preferred  class  shall  consist  of  wife,  husToand,  mother, 
children  and  grandchildren.  In  Quebec  the  class  consists 
In  the  case  of  a  man,  of  his  wife,  his  children  and  his  wife's 
children.  In  the  case  of  a  woman  it  consists  of  her  chil- 
dren. In  Manitoba  the  class  is  confined  to  husband,  wife, 
children  and  step-children.  In  British  Columbia  the  mem- 
bers are  husband,  wife  and  children  of  the  insured.  In 
New  Brunswick  the  class  is  the  same  as  the  other  Mari- 
time Provinces,  but  also  includes  the  father  and  brothers 
and  sisters  of  the  insured.  In  the  Model  Act  it  was  con- 
cluded to  have  the  class  consist  of  the  wife,  husband, 
mother,  children  and  grandchildren,  the  same  as  in  the 
five  provinces  above  named.  It  has  been  suggested  that 
the  father  should  also  be  included.  The  new  Act  also  In- 
cludes adopted  children. 

Appointment  by  Declaration 
In  the  appointment  of  a  beneficiary  by  way  of  declara- 
tion, the  law  of  the  provinces  of  Ontario,  Saskatchewan 
Alberta  and  Prince  Edward  Island  has  been  followed, 
which  provides  that  the  appointment  may  be  made  by  any 
Instrument  in  writing,  including  a  will,  in  any  way  iden- 
tifying the  contract  or  describing  the  subject  of  it  as  the 
Insurance  fund,  policy  or  policies  of  the  insured  or  using 
language  of  like  import  in  describing  it.  In  the  other 
provinces  a  declaration  is  not  effective  unless  It  identifies 


the  policy  by  number  or  otherwise.  It  has  been  thought 
that  it  appears  from  the  words  used  by  the  insurer  in  the 
declaration  that  he  desires  to  change  the  beneficiary,  and 
the  subject  matter  is  reasonably  well  identified,  effect 
should  be  given  to  his  wish,  the  intention  of  the  insu'ed 
being  the  main  consideration.  The  new  Act  also  pro- 
vides that  a  declaration  shall  include  an  assignment  un- 
less stated  therein  to  be  for  valuable  consideration. 

The  law  of  Alberta  has  been  closely  followed  in  the 
case  of  the  disposition  of  insurance  moneys  on  the  death 
of   preferred   beneficiaries. 

Benefits  Under  Policies 
Sees.  42  to  46  inclusive,  deal  with  benefits  under  poli- 
cies and  give  the  insured  power  to  convert  into  a  paid-up 
policy,  to  borrow  on  the  policy,  to  meet  premiums,  to 
direct  the  application  of  surplus  and  to  surrender  with 
the  consent  of  the  beneficiaries.  These  provisions  have 
been  in  all  of  the  Provincial  Statutes  for  years.  Sees.  45 
and  4  6  are  new  and  deal  with  the  commutation  of  In- 
stalment policies  and  the  holding  of  insurance  moneys 
by  a  Company  in  trust  for  beneficiaries,  after  the  maturity 
of  the  contract. 

In  the  Insurance  Acts  of  the  Maritime  Provinces  it  is 
provided  that  insurance  moneys  are  payable  at  the  ex- 
piration of  thirty  days  after  proofs  of  claim  have  been 
furnished.  This  provision  is  being  adopted  in  the  new 
Act.  It  is  also  proposed  to  limit  the  right  of  action  to 
one  year  after  the  cause  of  action  arose  or  to  six  years 
after  the  maturity  of  the  contract,  whichever  period  first 
expires.  The  procedure  in  obtaining  an  order  as  to  pre- 
sumption of  death  is  taken  from  the  Ontario  and  Saskat- 
chewan Statutes.  These  subjects  are  dealt  with  in  Sees. 
47  and  4  8.  There  have  been  conflicting  decisions  as  to 
the  presumption  of  death  in  cases  where  several  perish 
in  the  same  disaster.  This  question  is  covered  by  Sec.  49. 
Proofs  of  claim  are  dealt  with  by  Sec.  50.  In  order  not 
to  subject  claimants  to  unreasonable  requirements  in  re- 
spect to  proofs  of  claim  it  has  been  deemed  advisable  to 
provide  that  a  declaration  may  be  obtained  from  the  Court 
as  to  the  suSiciency  of  the  proofs,  analogous  to  the  prac- 
tice in  obtaining  an  order  as  to  presumption  of  death. 
This  affords  an  inexpensive  and  expeditious  method  of 
disposing  of  a  vexed  question,  which  occasionally  arises 
and  should  tend  to  avoid  litigation. 

Other  Provisions 
Sees.  52  to  56  inclusive,  relate  to  the  payment  of 
shares  of  infants  and  other  persons  under  disability  and 
the  Investment  of  such  moneys.  Section  52  provides  that 
infants'  shares  may  be  paid  to  the  executors  of  the  in- 
sured or  to  a  guardian,  tutor  or  trustee  of  such  infants. 
This  is  the  law  in  all  of  the  provinces  except  Ontario  and 
Saskatchewan.  In  the  last  two  provinces,  infants'  shares 
must  be  paid  into  Court  unless  the  insured  names  a  trus- 
tee to  receive  such  shares  on  behalf  of  the  infants.  Many 
are  of  the  opinion  that  in  no  case  should  infants'  shares 
be  paid  to  the  executors  of  the  insured.  Most  of  the  leg- 
islation on  this  subject  has  been  taken  from  the  Quebec, 
Manitoba  and  British  Columbia  statutes. 

Sec.  57  provides  for  payment  to  the  foreign  represen- 
tative of  the  insured.  The  substance  of  this  section  is 
found  in  the  Statutes  of  Ontario,  Saskatchewan  and  the 
Maritime  Provinces  with  the  exception  that  the  time  limit 
for  payment  is  deleted 

Provincial  Jurisdiction 
In  a  few  words  I  wish  to  refer  to  the  jurisdiction  of 
the  provinces  respecting  insurance  contracts.  I  think  I 
am  right  in  stating  that  ever  since  the  judgment  of  the 
Privy  Council  in  the  case  of  Citizens'  Insurance  Company 
V.  Parsons  decided  forty  years  ago,  it  has  been  settled  that 
the  Dominion  Parliament  has  no  power  to  authorize  a 
company  of  its  own  creation  or  a  foreign  company  to 
make  contracts  in  a  province  except  such  contracts  as  the 
legislature  of  that  province  may  choose  to  sanction. 

For  years  it  has  never  been  contended  in  any  of  the 
Courts  of  Canada  that  the  Provincial  Insurance  Acts  in 
so  far  as  they  assume  to  deal  with  contracts  are  ultra 
vires,   no    matter   whether   the    companies   are   Provincial, 


January   6,   1922 


THE       MONETARY       TIMES 


103 


The 


CANADA 

Accident  and  Fire 

Assurance  Company 


Policies  Guaranteed  by 
Commercial  Union 
Assurance  Co.,  Ltd., 
of    London,      England 


HEAD    OFFICE 


MONTREAL 


Montreal  City  General  Agents  (Fire)  — 

G.   U.  Price,  Limited 

Toronto  General  Agents— 

Jones  &  Proctor  Bros.,  Limited 


THE  EMPLOYERS' 

Liability  Assurance  Corporation 

Limited 

OF  LONDON,  ENGLAND 


I'ERSONAii  ACCIDENT         SICKNESS 
EMPLOYERS'  LIABILITY 

WORKMEN'S  COMPENSATI(»J 

AUTOMOBILE  BURGLARY 

FIRE  FIDELITY  GUARANTEE 

CONTRACT  BONDS        COURT  BONDS 

BOILER 


C.  W.  I.  WOOULAND 

GENERAL  MANAGER 

For  Canada  and  Newfoundland 

TEMPLE  BUILDING  LEWIS  BUILDING 

TORONTO,  ONT.  MONTREAL,  QUB. 

PARIS  BLDG.       CANADA  LIFE  BLDG.       PACIFIC  BLDG. 

WINNIPEG,  Man.       CALGARY,  ALTA.       VANCOUVEB,  B.C, 


The    Watchword    To  -  Day 

IS  PROTECTION 

For  nearly  everyone  LIFE  INSURANCE  is  the 
safest  and  best    defence  of  Heme    and  Business 

The  Dominion  Life 

Takes  its  place  in  the  front  rank  among  the 
Companies  doing  business  in  Canada,  and 
isssues    Modern    Policies     for     Business      Men. 


Head  Office 


Waterloo,  Ontario 


194 


THE      MONETARY       TIMES 


Volume     68 


Dominion  or  foreign.  Tlie  Canadian  Law  Reports  are  full 
of  cases  where  Dominion  formed  Life  Companies  have 
successfully  relied  on  the  Insurance  Act  of  the  particular 
Province  in  which  they  were  doing  business.  On  the 
other  hand,  the  provisions  in  the  Dominion  Act  relating 
directly  to  the  insurance  contract  seem  of  doubtful  con- 
stitutionality, except  in  so  far  as  they  are  prescribed  By 
provincial  legislation. 

The  Model  Act  contains  nothing  of  any  consequence 
which  has  not  been  Included  in  some  of  the  Provincial 
Acts,  for  years.  I  am  of  the  opinion,  after  careful  con- 
sideration, that  the  Provinces  have  a  perfect  right  to 
legislate  respecting  insurance  contracts.  '  Even  as  it  is, 
there  is  no  conflict  between  any  Dominion  or  provincial 
legislation  respecting  life  insurance,  nor  is  there  likely 
to  be  if  the  Dominion  and  Provincial  Insurance  Depart- 
ments work  in  harmony  and  consider  first  and  foremost 
the  interests  of  the  great  insuring  public  throughout  the 
Dominion. 

There  is  no  doubt  that  the  Parliament  of  the  Do- 
minion has  the  right  to  incorporate  insurance  companies 
and  to  regulate  them  after  they  are  fol-med.  The  provinces 
have  a  similar  right  as  well.  However  once  a  Dominion 
formed  company  does  business  in  any  particular  province 
It  at  once  submits  ifself  to  the  laws  of  that  particular 
province  as  to  its  insurance  contracts.  This  has  been 
held  over  and  over  again  in  the  highest  Courts  of  the 
land.  I  cannot  emphasize  the  fact  too  strongly  that  the 
model  Act  has  nothing  whatever  to  do  with  the  constitu- 
tion and  status  of  insurance  companies.  It  simply  deals 
with  the  contractual  relations  existing  between  the  insurer 
and  the  insured  and  the  rights,  interests  and  status  of 
those  who  are  entitled  to  insurance  moneys. 

Advantages   of   Uniformity 

In  conclusion,  I  would  like  to  make  a  few  remarks 
on  the  subject  of  uniformity.  Embarrassments  have  re- 
sulted and  will  possibly  continue  to  result  by  reason  of 
our  dual  system  of  government.  Some  contend  that  It 
would  have  been  better  if  the  British  North  America  Act 
had  provided  clearly  that  the  whole  subject  of  insurance," 
including  the  incorporation,  regulation  and  taxation  of 
companies,  policy  conditions,  contractual  rights,  etc., 
should  be  within  the  exclusive  jurisdiction  of  the  Federal 
House.  However,  there  has  been  a  strong  drift  of  late 
towards  uniformity  and  harmony,  and  there  are  many 
who  believe  that  the  laws  of  the  various  provinces  can  be 
made  consistent  and  homogeneous  and  that  it  would  be 
better  for  all  concerned  that  the  business  be  conducted 
under  such  improved  laws  rather  than  under  a  centralized 
administration.  The  Hon.  IVIr.  Hughes,  Secretary  of  State 
for  the  United  States,  while  Governor  of  the  State  of  New 
York,  used  words  to  this  effect  when  advocating  uniformity 
of  State  laws  in  respect  to  insurance. 

I  need  not  enlarge  on  the  many  arguments  in  favor  of 
uniformity.  IVIost  of  the  insurance  companies  are  doing 
business  all  over  Canada,  and  there  is  no  good  reason  why 
the  Nova  Scotia  law  on  insurance  contracts  should  be  any 
different  than  the  British  Columbia  law  and  why  a  policy- 
holder in  New  Brunswick  should  have  greater  rights  than 
the  holder  of  the  same  kind  of  policy  issued  by  the  same 
company  residing  in  Alberta. 

Legal  Annoyances 

To  use  the  language  of  one  of  the  American  Insurance 
Commissioners:  "No  law  can  be  enacted,  no  existing  law 
can  be  amended,  without  causing  inconvenience  to  some 
one.  These  petty  annoyances  must  not  be  considered,  and 
If  the  officials  representing  the  departments  and  the  com- 
1  anies  will  come  together  with  the  one  purpose  of  framing 
the  law  for  the  best  interests  of  all,  such  law  can  be  framed. 
It  is  said  that  every  law  is  a  compromise.  There  is  less 
reason  for  compromise  here,  except  on  minor  points,  than 
In  any  other  case,  as  the  interests  of  the  companies  and  the 
Interests  of  the  policyholders  are  identical." 

Only  such  laws  can  be  generally  enacted  and  retained 
as  tend  to  the  Improvement  of  the  business  as  a  whole, 


and  any  law  that  will  have  this  effect  must  receive  the 
support  of  companies,  insurance  departments  and  policy- 
holders. 

The  object  of  the  Model  Act  is  to  formulate  and  present 
to  the  legislatures  of  the  different  provinces  a  sane  body  of 
laws  which,  while  safeguarding  the  interests  of  the  policy- 
holders, would  not  interfere  with  the  legitimate  prosecution 
of  business  on  the  part  of  the  companies,  and  would  at  the 
same  time  forestall  and  prevent  ill-digested  and  dangerous 
legislation  presented  by  active  self-advertisers  or  by  honest 
but  mistaken  enthusiasts.  In  his  address  this  year  to  the 
Commissioners  on  uniform  legislation,  the  President,  Sir 
James  Aikins,  K.C.,  put  the  subject  succinctly  as  follows: 
"What  does  uniformity  of  provincial  legislation  mean? 
Simply  a  standardization  of  the  substance  and  form  of  Acts 
relating  to  inter-provincial  commerce  and  business  for  the 
purpose  of  preventing  inconvenience,  annoyance,  expense 
and  delay." 

If  a  Model  Act  is  adopted  by  all  the  provinces,  the 
question  naturally  arises  as  how  the  law  can  be  kept  uni- 
form, bearing  in  mind  how  prone  legislatures  are  to  en- 
deavor to  improve  the  law  by  amendments.  In  all  prob- 
ability amendments  will  be  necessary  from  time  to  time 
and  in  order  to  preserve  uniformity  I  would  suggest  that 
any  proposed  changes  be  first  submitted  to  the  insurance 
departments  of  all  the  provinces  representing  their  re- 
spective legislatures  and  a  special  committee  representing 
the  companies,  for  approval  and  that  no  amendments  be 
adopted  without  such  approval. 

In  regard  to  the  interpretation  and  construction  of  uni- 
form acts  allow  me  again  to  refer  to  some  well  chosen  re- 
marks in  Sir  James  Aikins  address, — "Uniformity  of  prov- 
incial law  contemplates  local  legislative  control  of  those 
subjects  mentioned  in  Section  92  of  the  British  North 
America  Act.  But  legislation  alone  will  not  secure  uni- 
formity. It  will  be  necessary  for  the  courts  to  construe 
the  provisions  of  a  uniform  Act  in  the  light  of  the  de- 
cisions of  other  provincial  courts  on  similar  enactments. 
We  can  well  afford  to  learn  from  the  experience  of  the 
American  Bar  Association  and  their  Conference  of  Com- 
missioners. They  insert  in  every  uniform  Act  which  they 
recommend  this  clause: — • 

"This  Act  shall  be  so  interpreted  and  construed  as  to 
effectuate  its  general  purpose  to  make  uniform  the  law  of 
those  provinces  which  enact  it." 

With  such  an  expression  of  intention  by  the  legislatures 
the  courts  of  the  several  provinces  would  undoubtedly  co- 
operate. 

Lord  Macaulay  in  urging  the  passage  of  a  bill  in  the 
House  of  Commons,  providing  for  a  code  of  laws  for  the 
better  government  of  India,  summed  up  his  argument  as 
follows: — "Our  principle  is  merely  this — Uniformity 
where  you  can  have  it;  diversity  where  you  must  have  it; 
and  in  all  cases  certainty." 

To  paraphrase  this  principle  and  apply  it  by  way  of 
suggestion  to  the  Provincial  Legislatures — Recognize 
where  you  must  the  lines  which  divide  the  Provinces; 
promote  where  you  can  the  movement  for  uniformity  of 
laws  in  the  Provinces;  and  to  the  Judiciary — Adopt  in  all 
cases  of  interpretation  ^the  doctrines  of  stare  decisis  and  of 
judicial  comity. 


AUTOMOBnjE    UNDERWRITERS 

At  the  Annual  Meeting  of  the  Canadian  Automobile 
Underwriters'  Association  held  in  Ottawa  Nov.  28th,  29th 
and  30th,  the  following  new  officers  were  elected  for  the 
ensuing  year:  W.  T.  Perry,  Manager  for  Canada  of  The 
Ocean  Accident  and  Guarantee  Corporation,  President;  E. 
T.  Hussey,  of  The  Travellers'  Insurance  Co.,  1st  Vice- 
President:  E.  Willans,  General  Manager,  Imperial  Guar- 
antee and  Accident  Co.,  2nd  Vice-President;  and  J.  H. 
King,  Secretary.  Delegates  were  present  from  the  three 
Western  Associations,  which  are  now  affiliated  with  the 
Canadian  Automobile  Association,  with  head  offices  in  this 
city.  Routine  business  was  discussed,  and  several  matters 
of  interest  dealt  with,  but  no  radical  or  important  resolu- 
tions were  passed,  as  was  anticipated. 


January   6,   1922 


THE       MONETARY       TIMES 


196 


COMMERCIAL    UNION 
ASSURANCE  CO. 

Limited,   of   London,  England 


Capital  Fully  Subscribed $14,750,000 

Capital  Paid  Up 7,375,000 

Life  Fund  and  Special  Trust  Funds.  99,983,135 

Total  Annual  Income  Exceeds   87,500,000 

TotaV-  Funds  exceed  221,000,000 

Deposit  with  Dominion  Government 

(As  at  31st  December,  1920)..     1,699,233 


HEAD  OFFJCE,  CANADA  BRANCH 

**  Commercial  Union  Building  " 
MONTREAL 

Toronto  Office:  49  WELLINGTON  ST.  EAST 
Geo.  R.  Harfjraft,  General  Agent 


PALATINE 

INSURANCE    COMPANY 

Limited,      of     London,      England 

Capital  Fully  Paid |1,000,000 

Fire  Premiums,  1919,  net 4,725,890 

Interest,  net 259,890 

Total,  Income  4,985.780 

Funds   '7,722,490 

Deposit  with  Dominion  Government, 

(As  at  3l8t  December,  1920) . . .      532,567 

In  addition  to  the  above  there  is  a  further 
Guarantee  of  the  Commercial  Union  Assurance 
Co.,   Ltd ,   whose   funds    exceed     $221,000,000 


HEAD  OFFICE,  CANADIAN  BRANCH 


ing 


» 


**  Commercial     Union    Build 
MONTREAL 

Toronto  Office         -  60  KING  ST.  WEST 

Jones  &  Proctor  Bros.,  Limited,  Agents 


CANADA  SECURITY 

.    ASSURANCE    COMPANY 

^Guaranteed    by    Norwich    Union    Fire    Insurance    Society    Limited) 

Fire  ^    Hail     -    Automobile 

AvaiiabTe  Assets  over  $130,000,000 

Service  -         Strenerth  -         Satisfaction 


CALGARY.  ALBERTA 
T.  B.  Redding,  Manager 


Strength 

Western  Offices: 
MOOSE  JAW,  SASK. 


WINNIPEG.  MAN. 
E.  M.  Whitley,  Manager. 


396 


THE       MONETARY       TIMES 


Volume    68 


Fire  Insurance  Rating  Bureaus 

Classification  of  Risks  Has  Been  a  Problem  on  Which 
Opinons  Differ — Significance  of  Schedule  Rating  in  Con- 
nection   With    Building    Construction    and    Fire    Prevention 


BY  D.  C.  HEATH,  SUPERINTENDENT  OP  INSURANCE, 
MANITOBA 

(Aa  address  before  the  Superintendents'  of  Insurance    Conference,  Quebec,  October,  1921.) 


SCHEDULE  Rating,  like  almost  everything  else  in  this 
world  that  is  worth  while.  Is  an  evolution,  not  an  inven- 
tion. It  began  in  a  very  small  way  many  years  ago,  and  is 
the  result  of  the  persistent  gropings  of  the  insurance  frater- 
nity for  an  equitable  system  of  prorating  fire  losses  amongst 
the  insuring  public.  Nobody  is  satisfied  with  the  results 
so  far  obtained,  not  even  those  who  are  responsible  for  the 
rates,  and  nobody  ever  will  be  satisfied.  It  is  too  difficult 
and  complex  a  subject,  and  the  basis  for  calculation  is 
changing   like  a   kaleidoscope  all   the   time. 

Every  community  seems  at  some  time  or  other  to  go 
through  the  same  experience.  There  comes  to  all  a  per- 
iod of  freedom  from  fires  just  as  there  comes  a  period 
of  freedom  from  disease,  and  just  as  they  become  thor- 
oughly satisfied  with  themselves,  and  "thank  God  that 
they  are  not  as  other  men  are,"  and  agitate  for  a  substan- 
tial reduction  in  Insurance  rates,  along  comes  a  series  of 
devastating  fires,  and  they  are  thrown  back  into  the 
"Slough  of  Despond,"  saying  to  themselves,  "What  is  the 
good  of  expensive  fire  fighting  equipment  and  organiza- 
tions backed  up  with  expensive  water  works  systems  and 
much  preaching  about  Fire  Prevention  methods?"  As  a 
matter  of  fact  there  is  not  nearly  as  much  good  in  these 
things  as  there  ought  to  be,  and  there  never  will  be  until 
we  find  some  way  of  waking  the  public  up  to  the  fact  that 
our  rates  must  be  based  on  our  fire  losses,  and  that  our 
enormous  fire  waste  is  due  entirely  to  our  own  criminal 
carelessness    and    thoughtlessness. 

Rates  Not  Fixed  By  Guess  Work 

The  public  seem  to  be  of  the  opinion  that  insurance 
rates  are  all  guess  work,  placed  as  high  as  the  companies 
think  the  particular  community  will  stand  for;  and,  in- 
deed, I  can  remember,  not  so  many  years  ago,  when  com- 
pared with  the  manner  in  which  they  are  arrived  at  to- 
day, they  really  were  largely  guess  work,  facts  and  figures 
had  not  been  so  carefully  tabulated,  and  what  statistics 
were  then  available  had  only  been  collected  during  a  com- 
paratively short  period;  statistics  compiled  in  one  lo- 
cality were  practically  of  no  value  in  another  locality, 
owing  to  the  wide  difference  in  building  construction,  bus- 
iness methods  and  the  Individuality  of  the  Inhabitants; 
but  today  all  over  the  world  statistics  are  being  carefully 
tabulated  and  compared.  In  Canada  all  kinds  of  organ- 
izations are  calculating,  classifying  and  studying  fire  loss 
figures,  none  of  which,  of  course,  are  absolutely  correct, 
but  out  o£  all  these  statistics  we  most  ceitainly  must 
emerge  with  an  Improved  and  more  equitable  system  ot 
pro-rating  our  fire  losses. 

In  so  far  as  Canada  Is  concerned,  I  believe  schedule 
rating  is  entirely  in  the  hands  of  the  Insurance  Compa- 
nies. We  in  Canada  have  so  far  been  fortunate  in  that 
we  have  not  yet  developed  the  Trust  and  Combine  mania. 
— at  least  not  to  anything  like  the  extent  that  our  cousins 
to  the  south  of  us  have,  and  they  do  not  appear  to  have 
arrived  anywhere;  with  all  their  Trust  and  Combine 
smashing  they  only  seem  to  get  deeper  into  trouble,  like 
a  cow  struggling  in  a  quagmire. 

State  Control 

Nearly  every  state  in  the  Union  appears  to  have  taken 
a  smash  at  insurance  rates  in  some  form  or  other;  some 
went  to  one  extreme,  and  some  went  to  another  extreme, 
while  others  for  a  time  watched  results  like  the  canny 
Scot,  but  sooner  or  later  they  all  seem  to  have  got  the 


disease,  and  in  their  desire  to  reach  the  Elysian  Fields 
turned  things  upside  down;  and  so  far  they  do  not  ap- 
pear to  have  arrived  at  any  result  that  gives  any  more 
general  satisfaction  than  was  being  given  when  they 
started  out  on  their  campaign. 

In  my  humble  opinion,  comparatively  satisfactory  rates 
will  only  be  arrived  at  by  slow  and  careful  evolution,  back- 
ed up  by  some  legislation  (whatever  that  may  be),  and 
possibly  that  may  prove  to  be  just  as  hard  to  determine 
to  the  satisfaction  of  all  concerned  as  are  equitable  fire 
insurance  rates. 

Let  us  for  a  moment  consider  how  the  Insurance  fra- 
ternity are  endeavoring  to  prorate  our  fire  loss  at  the 
present  time. 

Classification   of   Risks 

First  ot  all,  they  have  for  many  years  been  more  or 
less  carefully  collecting  data  as  to  actual  conditions  sur- 
rounding fire  losses  spread  over  the  whole  of  Canada, 
and  over  as  many  years  as  possible.  From  the  information 
so  obtained,  they  have  endeavored  to  classify  results  as 
they  have  been  found  to  apply  to  various  building  mate- 
rials and  construction,  different  'occupancies,  the  amount 
of  fire  fighting  equipment,  if  any,  provided  either  by  pri- 
vate Individuals  or  municipal  authorities,  and  so  forth. 

This  being  a  difficult,  scientific  and  never-ending  pro- 
position. It  is  manifestly  impossible  for  each  company  to 
undertake  this  on  its  own  account,  so  they  decided  to  co- 
operate with  one  another,  and  established  rating  bureaus, 
composed  of  specially  trained  experts  in  various  lines  at 
convenient  centres. 

Towns -and  Cities  are  classified  and  rated  according 
to  general  construction  of  buildings  and  their  various 
groupings,  fire  protection  afforded  in  the  way  of  water 
"Works,  fire  fighting  equipment,  and  fire  alarm  systems. 
The  general  condition  of  the  town  form  a  fire  hazard  point 
of  view,  and  the  possibility  of  a  serious  conflagration.  A 
standard  for  towns  is  arrived  at  from  past  fire  hazard  ex- 
perience, and  each  town  is  graded  up  or  down  fi^m  this 
standard,  and  what  is  called  the  key  rate  is  arrived  at.  The 
various  rules  for  arriving  at  the  key  rate  may  not  be  sci- 
entifically correct,  but  they  are  all  worked  out  in  the  same 
way,  so  that  each  town  practically  sets  its  own  key  ratn 
according  to  the  collective  results  arrived  at  by  its  citi- 
zens, the  fire  fighting  equipment  provided,  and  the  efiic- 
iency  of  its  fire  fighters. 

Certain   Axioms   Are   Necessary 

Before  our  old  friend  Euclid  commenced  to  reason  out 
his  problems,  he  was  obliged  to  establish  axioms;  expe- 
rience and  logic  had  practically  established  that  certain 
things  were  so,  and  Euclid  took  it  for  granted  that  they 
were  so;  if  he  had  not  done  so,  he  would  not  only  have 
got  nowhere,  but  he  could  not  have  begun  his  reasoning; 
and  so  it  is  with  schedule  rating.  It  is  taken  for  granted 
that  a  building  of  one  construction  or  material  is  better 
or  worse  from  a  fire  hazard  point  ot  view  than  a  building 
of  some  other  construction  or  material,  and  a  standard 
is  arrived  at  for  the  various  classifications  of  buildings 
in  a  standard  town;  and  so  basis  rates  are  fixed;  then 
charges  are  made  for  hazards  and  defects  in  construction 
in  proportion  to  what  actual  experience  has  shown  to  be 
their  importance. 

For  instance,  a  standard  emrcdntile  building  must  be 
built  of  certain   materials   with   walls   of  a  certain   thick- 


January  6,  1922 


THE      MONETARY       TIMES 


197 


Agricultural  Insurance  Company 


of  Watertown,  N.  Y. 


Founded  1853 


Fully  paid  capital,  $1,000,000.00 


An  agency  of  the  Agricultural  lends  stability  to  any 
office. 

A  policy  of  the  Agricultural  gives  a  feeling  of  security 
and  assures  just  treatment  in  event  of  loss. 

A  desirable  company  for  both  agent  and  policy-holder. 


The  Imperial 
Guarantee   and    Accident 

Insurance  Company  of  Canada 


IMPERIAL    PROTECTION     POLICIES 

ACCIDENT  INSURANCE 
SICKNESS  INSURANCE 
GUARANTEE  BONDS 
AUTOMOBILE  INSURANCE 
AUTOMOBILE  FIRE  AND 

THEFT  INSURANCE 
PLATE  GLASS  INSURANCE 
ELEVATOR  INSURANCE 

WE  PROTECT   YOU  AGAINST    LOSS 


BRANCH   OFFICES: 

Montreal:  Winnipeg:  Calcarr: 

Canada  Life  BIdpr.  Union  Trust  Bids.  Canada  Life  Bids. 

VancauTcr:   Cramer  &  Co.,  Ltd. 


HEAD  OFFICE: 


22  Victoria  Street 


TORONTO 


BEAVER 

Fire  Insurance  Company 

Head  Office,  -  Winnipeg,  Man. 
A    CANADIAN     COMPANY 

Authorized  Capital         SI, 000,000.00 
Subscribed  Capital  S    3(K),5(M).00 

Paid  up  Capital  §    216,360.00 

5  Years'  Record ;  Policy  Holders'  Surplus 

31st  December,  1916 $204,030.46 

31st  December,  1917  233,715.84 

31st  December,  1918  270,439.3o 

31st  December,  1919 294,609.33 

31st  December,  1920  316,794.93 

RELIABLE  AGENTS  WANTED 


198 


THE      MONETARY       TIMES 


Volume    68 


ness,  with  a  non-combustible  roof.  It  must  not  have 
more  than  so  many  square  feet  of  floor  space  between  its 
division  walls,  nor  must  it  be  over  so  many  stories  in 
height;  elevators  and  stairways  must  be  entirely  cut  off 
with  division  walls  with  openings  protected  with  fire  doors, 
and  the  enclousures  must  project  so  far  above  the  roof. 
Heating  and  other  arrangements  must  come  up  to  certain 
requirements,  and  the  housekeping  ararngements  i^ust  be 
satisfactory. 

Charges  for  Defects 

For  a  non-standard  building  all  defects  are  charged 
for  according  to  their  seriousness,  and  for  protections 
credit  is  given.  For  instance,  a  skylight  is  a  defect,  and 
is  charged  for,  but  wire  glass  and  metal  frames  produce 
a  credit  if  properly  installed.  Stairways  are  charged  for, 
but  if  enclosed  and  furnished  with  a  self-closing  door,  a 
credit  is  given  according  to  the  material  used.  Then  ex- 
posures are  charged  for  acceding  to  thei  distance,  mate- 
lal  and  ocupancy. 

Finally  a  charge  is  made  for  the  occupancy  of  the 
building  according  to  its  hazard,  and  the  hazard  of  the 
goods  incidental  to  that  occupancy.  This  alsi  is  axio- 
matic. 

Usually  contents  are  charged  for  according  to  their 
inflammability,  but  there  are  goods,  not  in  themselves 
particularly  inflammable,  but  owing  to  their  delicate  tex- 
ture, susceptible  to  extraordinary  damage  from  fire,  smoke 
and  water,  that  carry  high  rates. 

Builder   Sets   the  Tlate 

This  is  roughly  how  the  rate  of  the  building  and  con- 
tents is  arrived  at.  and  to  each,  of  course,  must  be  added 
the  key  rate  of  the  town.  Therefore,  whatever  may  be 
''the  defects  of  the  system,  or  the  scientific  inaccuracy  of 
the  various  charges  and  credits,  when  a  man  builds  a 
building  of  certain  materials  and  construction,  with  cer- 
tain defects,  providing  certain  protections,  in  a  certain 
locality  with  certain  exposures,  he  practically  sets  his  own 
rnte,  according  to  the  accepted  rules;  and  if  he  takes 
the  trouble  to  study  those  rules,  he  can  materially  re- 
duce his  rate  without  Inordinately  increasing  the  cost. 

So  much  for  the  rating  system  as  we  knew  it  in  Can- 
ada, and  which  is  usually  known  as  "The  Universal  Mer- 
cantile Schedule."  There  are  others;  for  instance,  in 
some  parts  of  the  United  States  there  is  in  use  what  is 
known  as  "The  Dean  Schedule." 

Methods  of  Control 

Let  us  for  a  minute  consider  the  operation  or  control 
of  the  system.  It  seems  to  me  that  thero  are  Just  three 
methods  that  can  be  used — the  Insurance  Company  con- 
trol as  we  have  it  in  Canada  with  the  defects  or  other- 
wise, with  which  we  are  all  more  or  less  acquainted:  then 
there  is  the  private  control,  that  is,  or  was,  in  operation  in 
at  least  three  of  the  United  States,  a  private  individual 
or  corporation  conducting  the  bureau,  paying  all  ex- 
penses, and  assessing  each  insurance  company  by  arrange- 
ment. Then  there  is  Gov^ernment  control,  as  is  the  case 
in  certain  states  of  the  Union,  and  with  Government  con- 
trol must  be  considered  what  is  known  as  State  Insurance. 
You  have  some  slight  acquaintance,  and  no  doubt  certain 
opinions,  about  Government  ownership;  so  it  seems  to 
me  that  this  should  afford  you  splendid  material  for  a  real 
live  discussion.  Incidentally,  I  might  suggest  a  combi- 
nation of  Insurance  Company  or  Private  Control,  and  Gov- 
ernment Control. 


SOME   EXPEKIENCE   IN   GROUP   INSURANCE 


Is  of  Real   Value  to    Industry,    but    Does    Not  Solve   All 
Problems  of  Organization 


lilABILITY    INSURANCE 

There  are  different  forms  of  Liability  insivance.  "Pub- 
lic L'ibility"  insurance  protects  contractc  rs  aid  man- 
uCactnrers  agtih'st  suits  arising  from  the  accir  ntal  in- 
jury o-  deain  of  persons  not  in  fi  ir  emp) oy- -tl  •  general 
public  pasb-ng  by.  The  insurance  connanr  assu  i  ss  all  ex- 
pense in  such  cases,  and  pays  my  damages  r  varded  by 
the  courts.  The  experience  of  the  year  brought  nothing 
new  of  importance.  Business  activity,  especially  building, 
was  quiet,  so  the  volume  of  business  was  not  great. 


By  C.  a.  Rutherford,  A.I.A.,  F.A.S. 

Sun  Life  Insurance  Co.,  Montreal 

(From  Canadian  Insurance) 

In  assurance,  as  in  other  matters.  It  is  customary  for 
any  new  thing  to  be  greeted  by  some  as  the  greatest  ad- 
vance which  has  ever  taken  place,  and  by  others  as  a 
grievous  error  likely  td  seriously  injure  the  fabric  of 
business.  So  it  is  with  Group  Assurance.  Little  more  than 
two  years  have  elapsed  since  it  was  first  introduced  into 
this  country,  and  it  has  been  held  by  some  enthusiastic 
supporters  to  be  the  solution  of  all  business  problems,  and 
the  ultimate  salvation  of  the  industrial  world.  Nor  have 
its  detractors  been  idle  In  pointing  out  that  the  money 
so  spent  is  thrown  away,  and  might  better  have  been  ap- 
plied to  the  improvement  of  labor  conditions.  Between 
these  two  extremes  the  truth  will  be  found  to  lie.  Group 
Assurance  is  no  miracle  worker,  nor  is  it  reasonable  to 
suppose  that  the  small  amount  expended  on  a  group  policy 
will  tend  to  make  a  workman  satisfied  with  low  wages  or 
inferior  working  conditions.  Yet,  if  the  balance  is  not 
all  gain,  neither  is  it  all  loss,  and  a  sober  and  unprejudiced 
view  will  lead  to  a  proper  appreciation  of  this  type  of 
policy. 

Before  considering   the   place   which   Group   Assurance 
is  destined  to  fill   in  the  industrial   fabric,   let  us  discuss 
briefly  the  essential  nature  of  the  policy  itself. 
The   Group    Policy 

At  this,  the  very  threshold  of  our  subject,  we  meet 
with  a  serious  difiiculty,  the  lack  of  an  exact  definition  of 
what  constitutes  Group  Assurance.  Failing  this  definition 
— and  there  is  none  known  to  the  writer  that  can  be  con- 
sidered satisfactory,  the  legal  definitions  being  probably 
the  most  unsatisfactory  of  all — the  matter  may  be.  dealt 
with  by  analogy.  Under  the  Workmen's  Compensation 
Acts,  if  a  workman  dies  of  injuries  received  during  his 
employment,  and  arising  out  of  it,  his  heirs  are  entitled 
to  a  certain  payment.  The  nature  of  this  payment  varies 
with  the  country  under  whose  laws  it  is  furnished,  but  it 
is  almost  invariably  limited  in  the  manner  mentioned.  If 
this  compensation  were  extended  so  that  payment  must 
be  made  whether  the  death  arises  during  the  course  of 
employment  or  not,  provided  only  that  the  person  dying 
is  on  the  payroll  of  the  employer,  we  have  a  fair  idea  of 
the  benefits  intended  to  be  provided  by  this  latest  form  of 
assurance. 

This  analogy  throws  a  light  on  many  of  the  apparently 
arbitrary  limitations  set  by  the  insurance  companies  on  the 
policies  which  they  will  write.  It  is  obvious,  for  one  thing, 
that  the  maximum  amount  of  assurance  permitted  should 
only  be  in  the  nature  of  temporary  assistance  to  the  de- 
pendents of  the  deceased  and  not  as  a  permanent  provision 
to  maintain  the  home  above  the  reach  of  want.  In  its 
essence  it  is  the  reverse  of  paternalistic.  Its  mission  is  to 
fulfil  the  moral  obligation  of  the  employer,  and  not  to 
provide  for  the  well-being  of  the  employee's  family. 
Employer's   Obligation 

Considering  the  liabilities  that  gather  round  a  death- 
bed, it  must  be  admitted  that  there  is  no  man  too  poor, 
or  too  rich,  not  to  require  the  assistance  of  life  assurance 
in  settling  his  obligations  to  his  creditors  and  surviving 
relatives.  Nevertheless,  in  the  case  of  industrial  work- 
men, the  day  laborer,  liable  at  any  time  to  cease  work  for 
an  indefinite  period — to  all  except  the  most  important 
branches  of  the  clerical  staff — it  has  become  recognized 
that  only  tlie  Tiost  careful  have  acquired  the  habit  of  pro- 
viding for  the  immediate  liabilities  arising  on  their  death, 
and  it  is  almost  uniformly  recognized  that,  however,  in- 
convenient it  may  be  from  a  financial  standpoint,  the  em- 
ployer must  make  an  allowance  of  some  sort  to  the  depend- 
ents of  a  deceased  employee,  or  incur  public  censure. 

From   an  economic  standpoint  the  existing  system  has 


January  6,   1922 


THE       MONETARY       TIMES 


199 


ESTABLISHED  1899 


The  National  Life 

Assurance     Company    of     Canada 


Head  Office 


Toronto 


Back  of  every  Policy  Contract  Assuring  each 
National  Life  Policyholder  the  largest  possible 
measure  of  Service,  Safety  and  Saving,  towers  the 
Strength  and  Security  of  the  Company,  as  attested 
by  more  than  two  decades  of  conspicuous  success. 

"PERMANENT     AS     THE      PYRAMIDS" 


THE   ORDINARY   LIFE  PLAN 

On  this  |..Ian  for  Premium  5  at  ages  given  in  the  table  on  a  $5,000  basis, 
for  a  policy  with  Double   indemnity  and  Double  Disability  Provisions. 

The  Ontario  Equitable  GUARANTEES 

Yearly  Premium  constant  at  rates  quoted 

Amount  Payable  at  Death  or  at  age  85  $  5,000.00 

Am't  Payable  in  event  of  Death  by  Accident  $10,000.00 

If  Total  Disability  occurs,  No  Further  Premiums  will  be 
required  and  in  Addition  the  Company  will  pay  the  In- 
sured while  permanently  di  abled  (without  reducing  the 
face  of  the  policy)  A  MONTHLY  INCOME  OF  $100.00. 


TABLE  OF  PRfMIUM3 

for  $5,000 

Ajji 

Premiums 

20 

$8(5.25 

25 

98.00 

30 

113.00 

35 

131.50 

40 

15fi.25 

45 

18'...'M) 

50 

232.50 

Drop  a  linejto  Head  Office,  or  to  any  of  the  Company's 
Agents  for  further  pai  ticulars  and    a  sample    policy. 

Th^  Ontario  Equitable  Life  aiid  Accident  Insurance  Company 


Head  Office 


Waterloo,  Ontario 


200 


THE      MONETARY       TIMES 


Volume    68 


undesirable  results.  The  relatives  who  live  strictly  up  to 
their  obligations,  and  are  desirous  of  standing  on  their 
own  feet,  hesitate  to  approach  the  employer  for  assistance. 
In  many  cases  where  the  deceased  has  been  paid  by  the  day 
or  week,  and  has  ceased  work  on  account  of  ill  health,  the 
fact  of  his  death  is  never  even  conveyed  to  the  employer. 
These  then,  the  soundest  and  most  desirable  citizens,  are 
too  often  set  aside  on  account  of  their  very  independence 
of  spirit,  while  the  careless  and  thriftless  class  are  grant- 
ed almost  as  a  right  that  assistance  which  should  be  within 
the  reach  of  all. 

The  Third  Party 

Surveying  the  moral  obligation  of  the  Employer,  and 
the  manner  in  which  it  is  so  often  fulfilled,  the  advan- 
tages of  the  intervention  of  a  third  party  are  obvious.  On 
the  one  hand  the  employer  himself  deals  With  the  living, 
and  not  with  the  dead.  He,  moreover,  deals  with  his  own 
workmen,  and  not  with  unknown  dependants.  He  is  not 
required  to  decide  which  of  the  various  dependant  relatives 
left  by  the  deceased  employee  the  latter  was  most  anxious 
should  be  cared  for,  for  that  decision  has  already  been  made 
by  the  employee  himself.  Above  all,  he  is  not  required 
to  decide  the  amount  of  assistance  which  should  be  given 
in   each    case,   nor   to    discriminate   between   individuals. 

The  situation  in  regard  to  the  employee  is  also  clarified. 
He  and  his  are  not  the  recipients  of  charity;  for  the  amount 
involved  as  a  premium  Is  too  small  a  proportion  of  his 
wages  to  be  considered  as  a  donation.  Indeed  the  prem- 
ium paid  rarely  exceeds  2  per  cent,  of  the  payroll,  and  is 
often  less  than  1  per  cent.  The  provident  employee  knows 
exactly  to  what  extent  his  family  will  be  assisted  at  his 
death,  and  the  improvident  •mployee  is  to  that  extent  pro- 
tected against  his  own  shortcomings.  Finally,  the  placing 
of  the  payments  in  the  hands  of  an  insurance  company 
clears  up  the  position  with  regard  to  the  surviving  de- 
pendants. Those  who  would  hesitate  to  approach  the  em- 
ployer for  assistance  which  they  feel  was  not  inferred  in 
the  contract  under  which  the  employee  worked,  are  not 
required  to  stoop  to  the  indignity  of  receiving  charity,  but 
as  a  matter  of  right  can  claim  payment  of  the  amount 
provided  under  the  Group  Assurance  scheme.  The  thrift- 
less, on  the  other  hand,  have  no  excuse  for  approaching 
the  employer.  Their  rights  are  determined  by  contract,  and 
they  cannot  advance  their  poverty  stricken  condition  as  a 
reason  for  immediate  assistance  by  the  employer. 

Expense   High 

It  will  be  seen  from  these  considerations  that  even  if 
the  Group  Assurance  scheme  costs  considerably  more  than 
Individual  employers  are  in  the  habit  of  paying  out,  these 
Denefits  are  nevertheless  great  enough  to  justify  the  actual 
cost.  So  far,  however,  from  being  considerably  in  excess 
of  the  amount  actually  paid  out,  the  cost  for  the  entire 
body  of  employees  only  exceeds  the  amount  required  to 
pay  the  claims  by  a  little  more  than  the  cost  of  administra- 
tion, which  includes  furnishing  the  employer  with  accurate 
and  valuable  records  of  his  staff,  and  presenting  the  scheme 
to  the  employees  so  that  each  may  know  his  position 
thereunder. 

In  the  case  of  an  employer  having  a  considerable  staff, 
say  2,000  or  more,  it  may  well  happen  that  the  premium 
paid  under  his  group  policy  will  consistently,  year  in  and 
year  out,  exceed  the  amount  paid  in  claims.  In  such  a 
case  the  service  in  regard  to  his  records  and  contact  with 
his  employees  must  be  taken  into  account,  together  with 
the  protection  afforded  against  the  possibility  cf  an  epidem- 
ic, which,  in  the  absence  of  this  provision,  would  at  the 
same  time  reduce  the  efficiency  of  his  working  staff  and 
require  the  payment  of  a  large  amount  in  death  benefits. 

Forms  of  Policy 

Employers  with  staffs  of  from  5p  to  l.OOO,  however, 
are  in  the  position  that  they  can  hardly  afford  not  to  have 
a  scheme  of  this  nature  in  effect.  It  may  well  be  that  they 
will  pay  for  many  years  without  receiving  a  single  pay- 
ment in  death  claims,  but  as  against  that  they  are  protected 
from   the   possible   requirement   to   pay   allowances   whei-e 


even  a  single  payment  might  be  considerably  in  excess  of 
the  total  group  premium  for  the  entire  year.  This  certainty 
may  be  considered  worth*  more  than  the  amount  charged 
for.  It  is  a  common-place  in  accounting  that  a  small  ex- 
penditure is  more  easily  provided  for  by  a  firm  than  an 
amount  that  may  average  less  over  a  period  of  years,  but 
which  may  call  for  a  large  payment  at  one  time,  requiring 
to  be  balanced  by  a  long  period  for  whicTi  no  payment  is 
due. 

Summing  up  the  various  considerations  with  which  we 
have  dealt,  it  is  obvious  that  there  is  a  real  place  in  busi- 
ness for  the  benefits  provided  by  group  insurance.  It  is 
a  material  addition  to  the  modern  industrial  structure. 
On  the  other  hand  it  is  idle  to  declare  that  it  will  solve  all 
problems  in  dealing  with  labor.  Its  value  may  indeed  be 
many  times  the  actual  amount  spent  in  premiums,  but  it 
can  never  be  accepted  as  a  substitute  for  wages  below  the 
current  scale.  It  may  be  said,  however,  that  the  amount 
required  for  a  premium  under  a  group  policy  could  not  be 
applied  in  any  manner  which  would  give  better  results,  and 
in  this  fact,  we  believe,  lies  the  full  justification  of  Group 
Assurance. 


GUARANTEE  INSURANCE  IN  1921 


A  Sunuuary  of  the  Experience  of  Companies  Writing  This 
Line  in  Canada 


THIS  form  of  insurance  is  issued  to  cover  all  require- 
ments of  business  men  in  the,  bonding  of  em- 
ployees or  issuing  various  forms  of  bonds  that  may  be 
reuired  by  business  contracts.  There  are  so  many  diff- 
erent kinds  of  bonding  insurance  that  it  would  not  be 
possible  in  our  limited  space  to  give  even  an  outline  ; 
but  nearly  all  the  alrge  companies  write  all  approved 
modern  forms  of  fidelity  and  surety  bonds,  and  their 
agents  are  always  ready  to  explain  the  details  of  these 
to  business  men. 

1921  Expensive 

The  Dominion  of  Canada  Guarantee  &  Accident  Insur- 
ance Co.  report  that  their  guarantee  business  showed 
a  slight  increase  in  volume  during  the  first  ten  months 
of  1921,  over  the  like  period  of  1920.  C.  A.  Withers, 
the  general  mangaer,  reports  that  on  the  whole  this 
department  has  continued  uite  satisfactory  in  every  way, 
and  referred  with  justifiable  pride  to  the  company's  pro- 
fit-sharing plan,  whereby  a  dividend  on  the  total  profits 
of  the  company  each  year  is  paid  to  all  their  employees 
at  the  same  time  that  dividends  are  paid  to  the  share- 
holders. This  commendable  scheme  is  altogether  distinct 
and  apart  from  the  uestion  of  employees'  salaries. 

The  Imperial  Guarantee  &  Accident  Insurance  Co., 
through  E.  Willans,  manager,  reports  their  guarantee 
business  for  ten  months  of  1921,  as  showing  about  the 
same  results  as  for  the  like  period  of  1920.  The  claims, 
however,  proved  to  be  a  little  heavier  than  last  year, 
showing  from  another  angle  the  apparent  unfavorable 
results  of  a  year  of  marked  depression  in  nearly  all  lines 
of  general  business. 

Increased  Business 

The  General  Accident  &  Insurance  Co.  of  Canada 
report  a  considerable  increase  in  the  volume  of  their 
guarantee  business — the  figures  for  the  ten  months  of 
1921  being  $25,644.42,  against  $19,831.91  in  1920;  but 
their  claims  were  two  and  one-half  times  as  much  in 
1921  as  in  1920,  the  figures  being  $10,800.86,  as  against 
$4,308.96   in   1920. 

A  well-known  guarantee  company  reports  a  very 
favorabel  business  in  guarantee  bonds  during  the  tne 
months  of  1921.  This  company  admits  that  they  were 
affected  like  all  others  by  the  bad  business  conditions 
generally,  especially  in  Toronto,  but  on  the  whole  the 
year  proved  favorable  in  this  department,  for  their  pre- 
mium receipts  from  guarantee  bonds  totalled  $150,000, 
showing  an  increase  of  $32,606,  as  compared  with  the 
like  period  of  1920. 


January  6,   1922 


THE       MONETARY       TIMES 


When  the  average  insurance  man 
thinks  of  sub-standard  Life  Assurance, 
he  forms  a  mental  picture  of  men  and 
women  on  the  very  border-line  of  Death, 
or,  perhaps  in  their  coffins.  We  are  con- 
tent to  allow  him  to  retain  his  miscon- 
ceptions. 

A  Life  Assurance  Company  must  not 
take  undue  risks  or  the  main  purpose  of 
Its  existence  would  be  defeated.  There 
are  thousands  of  men  and  women,  how- 
ever, whose  physical  impairments  only 
slightly  shorten  their  lives.  The  extent 
of  this  shortening  of  life  may  be  under- 
stood and  taken  into  consideration,  and 
a  protective  bond  produced  which  Is 
fair  to  the  one  seeking  protection  and 
still  absolutely  safe  for  the  company. 

It  is  a  matter  of  exact  knowledge,  and  this  knowledge  the  trained  members 
of  our  Actuarial  Department,  Medical  Board,  and  staff  of  consulting  physi- 
cians amply  possess. 

We  conceive  it  our  privilege  and  our  duty  to  find  protection  for  those  who  are  not  in  every  way  "Perfect" 

lives,  for  these  are,  perhaps,  just  the  very  men  whose 
wives  and  families  might  suffer  the  greatest  distress  in  the 
event  of  the  Breadwinner's  Death,  and  who,  therefore, 
most  need  the  beneficent  safeguard  against  eco- 
nomic loss,  which  Life  Assurance  alone  can  give. 


Sub- Standard 
Assurance  as  it 
Really  is 

Sub-standard  Life  Auuranc«,  then.  Is  a  >cl«nUflc 
system  of  grading  risks,  and  it  is  as  safe  and  a*  fair 
and  equitable  as  the  system  underlying  the  compu- 
tation of  premiums  on  "Standard"  lives.  There  is 
no  guesswork  about  it— the  applicant  pays  for  what 
he  gets  in  exact  ratio  to  the  effect  of  hli  infirmity 
upon  the  length  of  his  life. 

Write  us  about  the  cases  your  own  com- 
pany will  not  accept,  or,  better  still,  join 
the  Northwestern  agency  force  and  save 
the  conunissions  you  now  lose  on  this 
class   of   business. 


The  Norfhwestern  Life  Assurance  Company 


WIN  NIPE  G '  CANADA 


H.R.S.  McCABE 

Manayinq  Director 


F.  O.  MABER 


Sfcre, 


2']/  i:e<}Sartr 


rrnniiiiiiiM.- 


iiiiiiiiiiii  ■ 


202 


THB      MONETARY       TIMES 


Volume    68 


Credit  and  Fire  Insurance 

Many  Fraudulent  Attempts  to  Realize  on  Fire  Insurance 
Policies  Have  Been  Made  During  Past  Year — Some  Examples 
From  the  Work  of  the  Ontario  Fire  Marshal's   Department 

By   GEORGE   F.   liEWIS,   DEPUTY   FIRE   MARSHAL    OF 
ONTARIO 

(An  address  before  the  Ontario  Fire  Insurance  Agents' Association,  Hamilton,  October  19,  1921.) 


THE  Fire  Insurance  business,  while  being  dabbled  in 
by  almost  every  class  in  the  community,  is  coming 
into  its  own  and  is  being  recognized  more  and  more  as  a 
high-class  profession  of  specialists  calling  for  the  best  tal- 
ents of  carefully  trained  men  and  engineers.  You  have 
built  up  a  great  and  influential  organization  of  men 
banded  together,  with  high  ideals  for  mutual  advancement 
and  the  futherance  of  the  best  interests  of  the  Profession 
with  the  fundamental  underlying  thought  of  "playing  fair 
with  your   fellow   men." 

The  volume  of  the  Fire  Insurance  business  in  this  pro- 
vince is  stupendous,  its  ramifications  are  varied  and  must 
be  met  in  a  progressive  spirit;  and  with  broader  ideas  and 
a  bigger  conception  than  was  considered  necessary  'but  a 
few  short  years  ago. 

This  is  a  progressive  age  and  old  ideas  are  fast  passing 
away.  It  has  been  suggested  that  a  fresh  code  of  business- 
ethics  could  be  written  with  each  incoming  generation; 
that  some  of  the  practices  in  vogue,  looking  backward  thir- 
ty years,  common  at  that  time  and  then  accepted  with 
complacency,  are  to-day  classed  as  disreputable,  or  the 
law  forbids;  and  that  some  of  the  practices  of  to-day  may 
be  so  classed  in  later  years. 

New  conditions  will  bring  new  abuses,  but  with  the  in- 
culation  of  modern  ethics,  some  one  may  be  trusted  to 
point  the  way. 

You  are  the  mainspring  of  the  vast  mechanism  of  the 
Insurance  business,  and  on  your  shoulders  rests  a  great 
responsibility  in  the  up-building,  progress  and  prosperity 
of  this  province.  You  cannot  stand  still.  You  must  ad- 
vance. As  Alice  in  Wonderland  puts  it  "you  have  to  keep 
ruflning  as  hard  as  you  can,  to  stay  where  you  are." 

The  only  cry  which  pleases  the  heart  of  the  ambitions 
man  is  "Forward."  Something  superior,  something  new, 
something  hitherto  unequalled  must  be  evolved,  or  the  out- 
coitie  of  thought  and  labor  yyill  'be  unsucces.sful.  The  very 
effort  to  a,.dvance^-^to  arrive  at  a  higher  standard  than  we 
have  reached — is  inspiring  and  invigorating.  The  devel- 
opment and  progress  you  have  made  as  an  Association  is 
prophetic  of  the  future.    ' 

Cre<lit  and  Fire  Insurance: 

"Credit"  Is  the  foundation  on  which  Trade  and  Com- 
merce of  the  world  is  built  and  "Fire  Insurance"  is  the 
keystone,  the  essential  element,  which  completes  the  struc- 
ture, locks  its  members  together,  and  keeps  it  safe  and 
permanent.  Millions  are  loaned  on  the  stroke  of  a  pen  al- 
mi  st  every  day  in  the  year.  The  merchandise  ,which  en- 
ters into  the  transaction  may  be  a  thousand  miles,  or  more, 
away  but  the  deal  is  made  sate  by  another  stroke  of  the 
pen  and  a  Fire  Insurance  Policy  comes  into  being. 

V  Credit  as  an  asset  Is  worth  all  the  yellow  gold  of  the 
mines  to  the  man  who  has  earned  it  and  means  to  retain 
it.  In  establishing  his  credit  he  gains  the  coin  current 
minted  from  character.  Not  only  is  Credit  a  priceless  asset 
to  the  man  in  commercial  life,  but  to  the  professional  man, 
the  clerk,  and  the  mechanic  its  value  has  long  been  proven. 
To  make  those  enormous  transactions  possible  it  is  neces- 
sary that  the  commodities  of  "Credit"  and  "Fire  Insurance" 
be  cheap.  They  are  cheap — possibly  the  cheapest  things  in 
the  commercial   world   to-day. 

I  will  go  farther  and  say  that  they  are  too  cheap — they 
are  too  easily  obtained  by  certain  unworthy  classes  of  the 
community.     As  these  main  arteries  are  necessary  in  the 


legitimate  transactions  of  Trade  and  Commerce;  so  also  are 
they  taken  advantage  of  in  the  illegitimate  transactions  of 
deception  and  fraud  by  the  criminal  classes  in  our  com- 
munity. We  continuously  hear  complaints  from  all  sec- 
tions of  mercantile  life  of  dishonest  methods  resorted  to 
by  a  section  of  the  foreign  population  in  business  dealings. 
They  have  it  down  to  a  fine  art,  and  apparently  are  able  to 
obtain  almost  unlimited  credit  and  unlimited  Fire  Insur- 
ance with  ease  and  facility. 

Deception 

Sometimes  it  almost  seems  as  though  the  tricky  and  frau- 
dulent foreigner  was  given  preference  in  this  nefarious 
work;  but  I  think  the  real  facts  are  that  they  resort  to  all 
kinds  of  deceptive  and  underhand  means  to  attain  their 
object.  Two  or  three  of  many  cases  that  have  come  to  our 
attention  may   be   illuminating: 

Two  Jews  invested  $300  each,  in  a  ready-to-wear  busi- 
ness. They  had  three  bank  accounts.  They  got  lines  of 
Credit  from  each  bank.  They  got  Credit  from  Wholesale 
firms  amounting  to  $6,000.  They  got  private  accommoda- 
tion amounting  to  over  $1,000.  They  got  Fire  Insurance 
amounting  to  $9,000,  on  a  stock  never  valued  at  more  than 
$4,000,  according  to   their  own   estimate. 

They  took  in  a  third  partner  with  $1,800  worth  of  stock, 
on  which  there  was  a  liability  of  $1,000  on  which  he"  had 
a   cover   of   $5,500    Fire   Insurance. 

They  couldn't  or  wouldn't  pay' their  debts.  It  was  evi- 
dently a  case  of  fire  or  failure.  The  "plant"  was  made 
and  a  fire  occurred.  But  the  Are  wasn't  a  success.  There 
happened  to  be  another  Jew  Manufacturer  on  the  flt)or 
abovS' — whose  Insurance  had  been  recently  cancelled  and 
he  proved  to  be,  not  only  an  expellent  Fire  Preventionist, 
but  also  a  good  Fire  alarm.  ,  He  wasn't  ortliodox  or  he 
wouldn't  have  been  at  his  factory  at  the  time.  Or  else  he 
suspected  that  something  was  going  to  happen;  consequent- 
ly the  Aire  was  quenched  at  its  Incipiency  without  much 
damage.  , 

At  the  time  of  the  fire  there  was  an  overdraft  at  Bank 
$3,000  and  $4,D00,  with  Insurance  thereon  amounting  to 
$14,500. 

What  the  amount  of  claim  would  have  been  on  stock  if 
everything  »had  been  completely 'burnt  up,  is  problematical 
— but  you  can  form  a  fair  estimate. 

At  the  time  of  the  fire  there  was  an  overdraft  at  Bank 
No.  1  ojf  $1,900  and  Bank  No.  2  account  was  ov^drawn 
to  the  extent  of  $700 — debts  amounted  in  all  to  over  $5,- 
000.     ■  ,• 

This  is  the  abridged  history  of  a  Manufacturing  Con- 
cern, in  business  for  fourteen  months,  with  which  our  high- 
•ly-taxed,  decent,  respectable  Canadian  Manufacturer  must 
compete.     I  ask  you,  is  it  fair? 

Another  similar  concern  had  an  unsuccessful  fire  re- 
cently and  in  this  case  the  stock  was  valued  at  $4,000  and 
they  had  a  cover  of  $15,000   Fire  Insurance. 

Succeeds  in  Fraud 

Some  months  ago,  I  was  advised  that  a  resident  of  one 
of  our  Northern  towns  wanted  to  go  home  to  Italy.  That 
the  first  windy  night  his  dwelling  would  be  burnt.  I  found 
out  the  names  of  the  Companies  that  were  on  the  risk 
and  the  Insurance  was  promptly  cancelled. 

^ew  and  additional  Insurance  was,  however,  placed  on 


January  6,  1922 


THE       MONETARY       TIMES 


203 


Incorporated  A.D.  1851 


Western    Assurance    Company 

FIRE,    AUTOMOBILE,     MARINE,    EXPLOSION, 
RIOTS,    CIVIL    COMMOTION    AND    STRIKES 


Assets 

Losses  paid  since  organization,  1851 


W.  B.  MEIKLE,  President  and 
General  Manag>°r 

W.  M.  COX,  Vice-President 

Sir  JOHN  AIRD 

ROBT.   BICKERDIKE    (Montreal) 


Directors : 
Lt.-Col.  HENRY  BROCK 
ALFRED  COOPER  (London,  Eng.) 
H.  C.  COX 

JOHN  H.  FULTON  (New  York) 
D.   B.  HANNA 


Over  $  8,000,000.00 
Over  $82,000,000.00 


MILLER  LASH 
GEO.  A.  MORROW 
Major-General 
Sir  HENRY  PELLATT,  C.V.O. 

E.  R.  WOOD 


London  Offices:  14  COR NHILL,  LONDON,  B.C. 

Head  Offices: 
Western  Assurance  Buildings,  Corner  Scott  and  Wellington  Streets 

TORONTO 

E.  P.  GARROW,  C.  S.  WAINWRIGHT, 

Assistant  General  Manager.  Secretary. 


British  Colonial  Fire  Insurance  Company 

Montreal 

Balance  Sheet  at  December  31st,  1920 

ASSETS 

Premiums  in  course  of  eolleetiou   $  42,585.88 

Bill.s  Rcccivenble 4,480.56 

Accrued  Interest 3,426.80 

Cash  in  Banks 141,173..1!) 

Investments    197,4]3..34 

Office  Furniture 7.111.12 

Plans    13.278.17       ^4n;>,46H.06 

Agencies,  treaties  and  estahlislnnent    .■)*  140.3 16.82 

Capital  subscril)ed  and  not  called         711,970.(X)         852,286.82 

$1,261.755,88 

LIABILITIES 

Capital  not  called $711,970.00 

Due  bv  Shareholders   3.985.00 

Paid-up  Capital 301.145.00 

Reserve  for  Lcsscs 14,135.32 

Deposit  by  Reinsurance  to  guarantee  their  contract. .  65,346.67 

Reserve 154.920.59 

Balance   10,253.30    ^1261.7.55  88 


204 


THE      MONETARY       TIMES 


Volume    68 


the  premises,  about  which  I  knew  nothing,  and  sure  enough 
within  one  month  the  dwelling  was  burned  to  the  ground 
a  total  loss.  The  usual  alibi  was  set  up  "the  owner  was 
away  from  home  at  the  time  of  the  fire."  He  got  his  money 
and  went    home  to  live  in  sunny  Italy,  a  rich  man. 

I  have  known  a  Jew  to  get  $3,500  Insurance  on  a  stock 
not  worth  $500.  It  took  just  three  days  for  the  Company 
to  cancel  it — but  he  got  other  Insurance  and  within  a 
couple  of  months  there  was  nothing  left  but  charred  em- 
bers of  his  stock  and  fixtures  from  a  fire  that  blew  the 
front  out  of  the  store  at  low  twelve  one  dark  night;  but 
did  not  spread  outside  the  one  room. 

The  chief  transgressors  that  we  have  to  deal  with  are 
among  the  criminal  classes  of  the  Jewish  and  Italian 
races.  It  Is  they  who  prey  upon  our  liberal  systems  of 
Credits  and   Fire  Insurance. 

The  breed  of  thieves  and  crooks  will  last  while  the  race 
lasts,  and  some  of  them  will  continue  to  "be  well  introduc- 
ed. They  will  come  to  you  of  forceful  personality,  of  cor- 
rect poise,  slickly  veneered,  immaculately  groomed.  They 
will  throw  you  bouquets  hoping  to  find  you  easy.  They 
will  mix  bland,  determined  importunity  with  a  veiled  mea- 
sure of  threat,  suggesting  that  you  are  behind  the  times 
unless  you  write  the  full  line  they  demand.  You  are  no 
doubt  accustomed  to  meet  these  men,  and  will  not  be  hur- 
ried or  sandbagged  into  making  an  ill-considered  cover. 
You  cannot  keep  a  vigilant  detective  and  a  bright  lawyer 
on  guard  to  watch  your  risk  over  night.  Consequently  you 
cannot  afford  to  gamble  upon  character  in  the  Insurance 
risk;   every  effort  should  be  made  to  know  in  advance. 

With  the  development  of  the  internal  combustion  engine 
and  the  general  use  of  automobiles,  laws  had  to  be  en- 
acted controlling  the  man  who  guides  the  motor  cars;  mak- 
ing him  responsible  for  the  life  which  rides  with  him  and 
that   which   may  cross  his  track. 

Section  515  of  the  Criminal  Code  provides  penalties  for 
those  causing  fire  which  results  in  loss  of  life  or  property; 
and  who  refuse  to  make  alterations,  remove  materials  or 
supply  apparatus  when  ordered  to  do  so  by  the  proper  au- 
thorities. 

Thus,  we  are  also  making  progress  In  our  Fire  Preven- 
tir  1  laws. 

Fires  in  the  Province 
In  1920  the  cost  of  maintaining  the  Ontario  ash  heap 
amounted  to   $11,771,718 — divided   among   9,296   fires.      A 
per  capita  loss  of  $4.70. 

During  the  last  five  years  there  have  been  48,312  fires 
In  this  province  consuming  $64,844,935  worth  of  merch- 
andise, buildings  and  foodstuffs,  averaging  one  fire  every 
hour  of  the  day  and  night,  and  a  daily  loss  amounting  to 
$35,500. 

In  this  day  of  advanced  civilization  it  is  appalling  to 
think  of  this  awful  destruction  of  our  substance  which  is 
gradually  but  nevertheless  effectively  impoverishing  our 
people. 

Our  fire  losses  in  Canada,  on  a  per  capita  'basis,  are  ten 
times  greater  than  the  average  of  the  five  principal  Euro- 
pean countries  in  normal  times. 

The  Insurance  premiums  in  Canada  are  approximately 
five  times  more  than  the  English  rates;  and  our  fire  waste 
is  about  five  times  as  great  on  a  per  capita  basis. 

For  the  last  three  years  the  Fire  losses  in  the  Domin- 
ion  have  averaged   twenty-seven   million   dollars  a   year. 

We  cannot  withstand  indefinitely  the  steady,  contin- 
uous drain  of  one  million  dollars  a  month  fire  waste,  in 
Ontario.  Something  must  be  done  to  stop  this  sapping 
of  our  commercial  strength  and  vitality. 

The  cure  of  this  National  disease  is  largely  in  your 
hands.  If  you  fail  in  your  diagnosis  and  administer  the 
wrong  potion,  the  disease  will  spread  further  necessitating 
the  administration  of  a  stronger  and  more  noxious  dose  by 
someone  else. 

I  doubt  if  any  person  will  controvert  me  when  I  say, 
that  if  all  suspicious  individuals  in  the  two  classes  that  I 
have  mentioned  were  absolutely  refused  Fire  Insurance, 
and  all  others  of  the  same  classification  were  held  down  to 
a  strict  50%   cover,  there  would  practically  be  no  arson; 


and   many  other  fires  which  do  not  bear   the  recognizable 
imprint  of  incendiarism  would  not  occur. 

Purely  accidental  fires  are  few  in  number  and  are  not 
the  cause  of  this  serious  fire  tax  on  the  people. 

Is  it  reasonable?  Is  it  right  to  expect  honest,  hard- 
working Canadians  who  have  to  supply  the  money  to  pay 
these  fire  friends'  losses  to  keep  on  doing  it?  There  is 
bound  to  be  reaction  if  the  scum  of  European  countries 
can  come  over  to  Canada  and,  by  flim-flamming  the  peo- 
ple, collect  in  a  few  months  enough  money  for  them  to  go 
back  home  and  live  for  the  balance  of  their  natural  lives 
in  opulence. 

Over-Insurance 

The  first  and  most  important  phase  of  this  problem  for 
your  organization  to  consider  and  for  the  individual  mem- 
bprs  to  carry  out  is  to  see  that  property — ^buildings  and 
contents — are  not  over-insured. 

Over-insurance  is  a  great  temptation  to  a  person  to  be 
careless  and  indifferent  with  regard  to  hazard  from  fire, 
no  matter  how  honest  he  may  be.  It  breeds  bad  house- 
keeping methods,  accumulations  of  litter,  rubbish  and  gen- 
eral disorder. 

If  business  is  bad  it  is  a  further  temptation  to  sell  out 
to  the  Insurance  Companies.  With  the  criminal  class,  the 
arson  gang,  the  pyro-maniac,  or  those  who  are  hopelessly 
Involved  in  debt  it  is  an  invitation  to  have  a  fire. 

Inventory  &  Inspection 

Agents  should  make  a  careful  inventory  and  see  that 
substantial  values  are  behind  every  cover,  and,  with  the 
exception  of  rapidly  fluctuating  lines  of  business,  further 
concurrent  insurance  should  not  be  permitted  without  writ- 
ten consent.. 

If  men  were  not  allowed  to  over-insure  their  stocks 
or  buildings  and  carried  a  portion  of  the  risk  themselves 
th°y  would  be  more  careful  to  take  adequate  precautions 
to  prevent  fires. 

Inspection 
Rigid  inspection  is  equally  important.  An  honest'  man 
will  do  everything  within  reason  to  safeguard  his  business, 
his  home,  and  the  lives  of  his  family  from  destruction  by 
fire.  A  suggestion  is  usually  all  that  is  necessary.  In  his 
report  of  the  Ontario  Insurance  Commission,  Hon.  Mr.  Jus- 
tice Masten  states: — 

"It  appeared  from  the  testimony  given  before 
me  that  more  than  60%  of  the  total  premiums  col- 
lected by  Boiler  Insurance  Companies  is  expended 
in    Inspection   and    Engineering   charges,    and    that 
the  actual  loss  ratio  of  all  these  companies  for  the 
last  ten  years,  is  not  more  than   7%  of  the  prem- 
ium.    These  examples  indicate  to  my  mind  that  ef- 
forts toward  Fire  Prevention  can   most   effectively 
be  made  by  periodical  inspection  of  risks  by  inde- 
pendent and  competent  inspectors." 
I  think  you  should  do  everything  in  your,  power  to  con- 
trol the   business  of  Fire  Insurance  by  restricting  it     and 
elevating  it  as  a  Profession  of  Specialists.     Cut  out  the  ir- 
responsible fly-by-nights — the  junk  dealer — and  those  who 
are  using  it  as  a  side-line.     Some  of  the  most  flagrant  cases 
of   over-insurance,   where   fraud   has   been   perpetrated      or 
attempted,  have  been   made  possible  by  a  certain  Life  In- 
surance Agent  who  sells  Fire  Insurance  as  a  side  issue. 

I  would  strongly  urge  that  your  Association  give  these 
matters,  hurriedly  placed  before  you,  most  serious  consid- 
eration. It  is  for  your  personal  benefit,  the  good  of  your 
Companies  and  the  progress  and  prosperity  of  our  country  at 
large.  Your  success  as  an  Association  and  as  individuals 
will  only  be  limited  by  the  service  you  render  the  public. 


Last  August  the  Toronto  General  Trusts  Corporation 
purchased  the  building  at  Portage  Av.  and  Main  sts.,  Win- 
nipeg, formerly  occupied  by  the  Bank  of  Ottawa. 


At  a  special  general  meeting  of  the  Colonial  Trust  Co., 
of  B.  C,  in  February  last,  a  resolution  was  passed  that 
the  company  be  wound  up  voluntarily,  with  the  Bankers' 
Trust  Co.  as  liquidator. 


INDUSTRIAL 


.):iiiii;iiy    ti,    11122. 


T  !1   K       M   ()  N   K  T  A   U  Y       T  I  M   K  S 


305 


206  T  H  B       M  O  N  E  T  A  R  Y       T  I  M  E  S  Volume  G8. 


-j,^||^|a|| 


POWER    HOUSE    ON    WINNIPEG    RIVER,    POINT    du    BOIS 

THE    CITY    OF   WINNIPEG 
HYDRO  ELECTRIC  SYSTEM 

HAS 

50,000 

Horse  Power  For  Sale 

Cheapest  Electricity  Supply 
On  the  Continent 

Address  all  enquiries  to 

Wiiuflpe^Hijdro. 


CITY    UICHT  6    POWER 


55-59  ^ffly|*  Princess  St 

WINNIPEG    ^^     CANADA 


January  6,  1922. 


THE      MONETARY      TIMES 


207 


Manufacturing  Has  Had  Difficulty  Period 

Conditions  of  Past  Year  Were  Almost  Entirely  Adverse  to 
New  Production — Prices  Declined  and  Markets  Were  Poor — 
Many    Plants    Have   Closed    Down,   Temporarily    at    Least 

ItV    WlliLIAM   LEWIS   BDMONDH. 


THE  year  which  Uaa  just  taken  its  departure  to  join  the 
years  numbered  with  the  past  were  marked  by 
features  sucli  as  had  never  hitherto  been  experienced  since 
the  birth  of  the  manufacturing  history  of  the  Dominion. 
There  have  undoubtedly  been  periods  ot  depression  which 
were  more  disastrous  in  there  consequences  For  while 
in  "practically  every  branch  ot  Industry  plants  were  oper- 
ated during  the  year  much  below  normal  capacity,  with 
several  closed  down  for  weeks  at  a  stretch,  thus  creating 
throughout  the  Dominion  a  large  army  of  unemployed, 
yet  those  of  us  who  have  reached  the  point  of  middle-lite 
can  readily  recall  periods  of  trade  depression  which,  both 
absolutely  and  relatively,  were  infinitely  more  dis-istrous 
In  their  effect  than  the  results  which  have  followed  In 
the  trail  of  the  adverse  business  conditions  ol   1921. 

Those  who  can  recall  the  history  of  trade  depressions 
experienced  during  the  past  forty-five  years  will  readily 
realize  this  if  they  turn  their  thoughts  to  the  subject. 
Eighteen  hundred  and  twenty-one  may  have  seen  a  great 
army  of  unemployed  in  the  Dominion.  But  it  has  not 
witnessed  wide-spread  and  general  financial  crumbling  of 
large  industrial  corporations  and  of  big  commercial 
houses,  the  demoralization  ot  the  agricultural  industry,  or 
the  failure  of  banks  so  disastrous  in  their  effect  that 
deirositors.  the  noteholders  and  shareholders  were  practi- 
cally unable  to  obtain  remuneration.  Neither  has  It  seen 
the  establishment  of  soup  kitchens  in  the  cities  to  teed 
the  starving  multitude  of  unemployed.  But  there  are 
men  and  women  alive  today  who  have  a  vivid  recollection 
of  periods  of  depression  when  all  these  untoward  things 
happened. 

That  the  depression  experienced  by  industry  during 
the  year  was  acute  there  can  be  no  question.  With  plants 
operating  as  a  rule  much  below  normal  capacity  and  sell- 
ing prices  considerably  reduced,  it  follows  that  there  must 
liave  been  a  decided  decline  in  the  aggregate  value  of 
factory  product.  That  it  was  as  low  as"  that  of  1915,  when 
the  value  of  the  product  was  $1,407,137,140,  is  not  con- 
ceivable. In  1917  the  aggregate  value  was  $3,015,577,000, 
and  in  1918 — when  the  last  estimate  was  made  by  the 
Census  Bureau — it  was  $3,548,036,975.  And  since  1918 
not  only  have  there  been  large  inr;reases  in  the  productive 
capacity  of  then  existing  plants,  but  a  considerable  number 
of  new  industrial  companies,  many  of  them  producing 
lines  not  hitherto  made  In  the  country,  have  been  brought 
into  existence.  It  is  therefore  pretty  sate  to  conjecture 
that  whMe  the  aggregate  productive  value  ot  the  (actorlea 
of  Canada  was  considerably  lower  than  in  either  1920 
and  1919.  It  W38  still  in  excess  ot  three  billion  dollars. 
One  has  only  to  consider  the  enormous  expansion  which 
has  taken  place  in  the  automobile,  rubber  fire  and  pulp 
and  paper  industries  since  19 IS  to  be  pursuaded  of  the 
moderate  character  ot  this  estimate. 

rol'ap.se  ot  World's   Crpdit   System 

I.O"nl  in  origin  some  of  the  ciuses  ot  the  depression 
undoul)tedly  were.  But  that  does  not  alter  the  fact  that 
the  principal  contributing  cause  was  a  world-wide  condi- 
tion, wth  its  centre  in  continental  Europe  and  its  circum- 
ference everywhere.  The  roat  of  it  was  in  the  condition 
of  the  world's  financial  centres,  which  having  been 
exhausted  by  the  exactions  ot  the  tour  years  of  war.  led 
to  the  ultimate  collapse  of  the  credit  foundations  of  every 
civili-.ed  country.  True,  the  signs  of  collapse  were  very 
much  in  evidence  during  the  latter  halt  of  1920:  but  it 
was  during  the  past  year  that  the  effect  of  the  war's  (|..^trii.. 


tlon   ot  capital   reached      its     climax   and   the   process   ot 
readjustment  the  maximum  of  activity. 

i'urt  IMa.vcd  l).v  Canadian  Itanlis 

In  Canada  during  the  past  year  the  credit  system, 
while  sharing  in  the  general  impairment,  was  probably  on 
the  whole  as  little  disturbed  as  that  of  any  other  country 
in  the  world — and  less  so  than  that  of  many  other  coun- 
tries. That  much  of  this  was  undoubtedly  due  to  the 
general  confidence  obtaining  as  to  the  recuperative  powers 
of  the  Dominion  there  can  be  no  doubt.  "With  such  vast 
natural  resources  as*  she  possesses  there  can  be  no  doubt 
regarding  the  ability  of  Canada  to  successfully  weather 
the  storm,"  was  in  effect  the  2bellef  of  every  Canadian 
qualified  to  express  an  opinion  on  the  subject.  And  a 
belief  ot  this  kind  tends  to  stimulate  effort  as  well  aa  to 
strengthen   credit. 

But  that  which  was  the  most  direct  factor  in  preventing 
the  credit  system  of  the  country  from  suffering  more  than 
it  did  was  undoubtedly  the  general  policy  which  character- 
ized the  activities  ot  the  Canadian  banks.  True,  a  great 
many  industrial  and  commercial  companies  were  frequently 
compelled  during  the  year — and  particularly  during  the 
first  half— to  rely  to  a  greater  extent  than  usual  on  their 
own  capital  resources  and  less  upon  bank  accommodation, 
a  condition  which  necessitated  some  ot  them,  in  order  to 
secure  needed  funds,  finding  a  market  tor  their  merchan- 
dise at  prices  which  left  little  or  no  margin  ot  profit. 
But  that  does  not  alter  the  tact  that  the  general  policy 
and  practice  of  the  banks  was  rather  to  furnish  accommo- 
dation to  the  highest  possible  limit  commensurate  with 
safety  rather  than  to  err  on  the  side  of  a  conservatism 
that  meant  the  crippling  of  industry.  In  other  words, 
while  on  the  one  hand  the  banks  were  bent  on  stabilizing 
and  strengthening  the  financial  position  of  the  country  by 
curtailing  credit  wherever  necessary,  on  the  other  hand 
they  were  generous  rather  than  otherwise  in  respect  to 
the  actual  needs  of  industry.-  The  proof  of  this  is  to  be 
found  in  the  proportion,  as  revealed  by  Government  bank 
statements,  w.hich  commercial  loans  bore  to  deposits 
month  by  month  during  the  year.  Had  their  policy  been 
less  generous  the  manufacturing  industry  would  undoubt- 
edly have  had  its  activities  even  more  curtailed  than  they 

Root  Cause  of  Canadian  I>opr«'s»<|o>«. 

That  the  world-wide  impairment  of  credit  was  the  root 
cause  of  depression  experienced  by  the  manufacturfng 
industry  of  Canada  during  the  year  there  can  be  no  doxibt. 
One  thing  is  certain:  it  was  not  due  to  over  production 
of  manufactured  goods.  Except  in  Isolated  Instances  stocks 
of  merchandise  .  both  at  home  and  abroad,  were  during 
the  year  rather  below  than  above  normal.  And  there  were 
two  factors  whose  influence  tended  to  maintain  this  con- 
(iit'on.  The  one  was  the  conservative  policy  of  the  banks 
in  respect  to  credit,  which  naturally  served  as  a  brake 
upon  merchants  who  might  ho  dispo-sed  to  unduly  antici- 
pate their  requirements.  The  other  f.ncfnr  wi-  the  general 
disposition    ot    merchants  owing  to  t'  .-es. 

to    keep    their   stocks  at  the  lowest  p<'^  iien- 

surate   with   the   immediate   needs   of   their   business. 

In  one  respect  the  foreign  markets  were  In  stteh  a 
position  during  the  year,  that  had  everything  else  con- 
nected therewith  been  normal  a  large  export  trade  might 
have  been  cultivated  tor  the  surplus  stocks  of  our  factor- 
ies. In  the  first  place,  and  particularly  In  continental 
Europe,  there  has  been  an  absolute  need  thronghont  the 
vK>:ir  fur   many  lines  of  merchandise  suoh  aa  Canada  is  In 


208 


THE      MONETARY      TIMES 


Volume  68. 


a  position  to  furnish.  In  the  second  place,  a?  a  result  of 
the  several  new  direct  ocean  steamship  lines  inaugurated, 
many  of  which  opened  up  new  avenues  for  trade,  better 
shipping  facilities  existed  than  in  any  previous  year  in  the 
history  of  the  Dominion.  In  the  third  place,  owing  to 
the  increased  attention  given  to  the  creation  of  special 
departments  for  its  cultivation,  a  large  number  of  the 
principal  manufacturing  concerns  were  far  better  equipped 
than  hitherto  for  carrying  on  the  export  branch  of  their 
trade. 

But  all  these  factors,  potent  as  they  would  have  been 
under  normal  conditions,  could  only  be  utilized  to  a  very 
modified  extent  owing  to  the  demoralized  state  of  the 
world's  credit  system.  In  other  words,  while  the  people  of 
Europe  wanted  our  products  they  were  unable  to  pay  for 
them.  And  the  situation  was  further  aggravated  by  the 
enormous  discount  obtaining  on  the  currency  of  nearly 
all  importing  countries,  while  our  export  trade  with  Aus- 
tralia and  New  Zealand  was  seriously  handicapped  by  the 
scarcity  of  negotiable  documents  held  by  the  two  countries 
in  London.  In  fact  about  the  only  country  whose  exchange 
rate  was  favorable  to  our  export  trade  was  the  United 
States. 

Deep  Cut  in  Manufactured  Exports 

As  a  result  of  the  financial  disability  of  the  importing 
countries  and  the  decline  in  market  prices  the  export  trade 
of  the  Dominion  in  manufactured  products  fell  olf  on  an 
average  moTq  than  fifty  per  cent,  during  the  year.  Owing 
to  latest  detailed  figures  only  covering  the  trade  for  the 
six  months  ending  September  it  is  necessary  to  confine 
comparisons  to  that  period.  But  these  are  sufficient  to 
illustrate  the  extent  to  which  the  export  trade  has  declined. 
The  following  table  comprises  twenty-five  different  prin- 
cipal export  items,  and  in  all  of  which  a  marked  decline 
took   place   during  the  six   months: 

1921  1920 

Agricultural    implements    ....f    3,546,343  $   6,204,714 

Automobiles 1,239,440  7,919,878 

Rubber    tires 1.076.561  5,200,403 

Sugar  and  products  of 7,296,412  13,845,826 

Canned   lobsters 2,918.409  4,298,839 

Leather 1,496.468  3,155,455 

Bacon  and  hams 12,510,231  16,320,969 

Butter 1.805.985  2,859,160 

Cheese 22,787,797  32,611,000 

Woollen  goods 683.134  3,570,387 

Cotton  goods 586.990  2,041,932 

Planks    and    boards 18,129.638  46,467,066 

Pulp 15,804.159  44,217,712 

Newsprint   paper 31,277.763  35.760,S33 

Hardware  and  cutlery 532.708  4,500,687 

Machinery 1,614.240  2,939,178 

Rolling  mill  products 1,425.213  6,572,035 

Smelted    iron    products    .  .     .  .          210.394  4,865,602 

Wire 88.659  1,195,686 

Wire   nails 72.022  2,532,966 

Aluminum 473.886  3,298,864 

Copper    and    its    products     .  .  .      3,485.173  6,799,935 

Nickel    1,987.828  5,652,329 

Cement 252.339  1,389,752 

Chemicals 4,236,580  11,235,027 

The  aggregate  value  of  these  twenty-five  lines  was 
$135,535,372,  as  compared  with  $285,  456,735  the  corres- 
ponding six  inonths  of  1920,  a  decline  of  $149,921,363. 
or  over  50  per  cent.  Among  the  few  lines  in  which 
Increases  were  made,  the  principal  ones  were: 

Flour $24,893,672  $23,460,944 

Canned    salmon 3,123,445  2,677,619 

Locomotives 1,058,811  403,558 

Sewing    machines 430,004  366,183 

Lead 482,369  143,369 

Exceptional  Cuts  in  Inventories 

The  extent  to  which  inventories  have  been  written  down 
by  Industrial  companies  during  the  yeiar  is  without  a  par- 
allel in  the  history  of  the  Dominion,  thus  entailing  enor- 
mous depression  in  value  of  assets.     But  it  was  an   under- 


taking that  was  absolutely  necessary  if  assets  were  to  be 
given  their  true,  and  not  inflated,  value.  Concurrently 
with  this  operation,  an  approximately  corresponding  reduc- 
tion was  also  amde  in  liabilities,  prominent  among  whicn, 
in  many  instances,  was  a  complete  liquidation  of  indebt- 
edness to  the  bank.  Tills  is  one  of  the  striking  features 
of  the  annual  financial' statements  of  some  of  the  principal 
industrial  corporations  issued  during  the  last  few  months 
And  it  is  reassuring  to  note  that  as  a  result  of  this  two- 
fold operation  the  companies  have  been  able,  as  a  rule, 
to  maintain  a  strong  position  in  respect  to  working  capital. 

That  the  manufacturing  industry,  taken  as  a  whole. 
is  in  a  much  stronger  position  in  respect  to  capital  than 
it  was  in  pre-war  days  there  can  be  no  doubt.  One  other 
economy  in  manufacturing  which  has  yet  to  be  completed 
is  that  in  respect  to  cost  of  production.  And  that  can 
only  be  accomplished  when  the  cost  of  labor  has  been 
brought  down  to  a  point  approximately  corresponding  with 
the  reduction  in  the  price  of  both  raw  material  and  the 
finished  product.  Much  has  undoubtedly  already  been 
accomplished  in  this  direction,  both  by  actual  lowering  in 
wages  and  the  greater  efficiency  that  characterizes  labor 
as  compared  with  a  year  ago.  but  there  are  still  industries 
in  which  the  wage  scale  is  abnormally  high  as  a  result  of 
the  opposition  of  organized  labor  to  a  change  .  Until  this 
equilibrium  between  the  cost  of  production  and  the 
market  price  of  commodities  is  more  generally  established 
than  at  present  industry  will  scarcely  reach  the  desired 
point  of  stability.  In  the  meantime  many  industries  are 
handicapped  in  meeting  foreign  competition  in  both  the 
home  and  the  foreign   market. 

Experience  of  Iron  and  Steel 

The  iron  and  steel  plants  of  Canada  have  probably 
suffered  more  from  the  conditions  obtaining  during  1921 
than  that  of  any  other  branch  of  industry.  Only  about 
one-fourth  of  the  blast  furnaces  have  been  in  operation 
during  the  year  and  mills  at  the  steel  plants  have  been 
intermittantly  closed  down.  The  complete  closing  down 
of  the  new  $5,000,000  ship  plate  mill  at  Sydney,  N.  S..  was 
a  particularly  regrettable  incident.  With  the  purchases 
of  railway  equipment  almost  nil  and  the  construction  of 
large  buildings  and  bridges  almost  at  a  standstill,  to  say 
nothing  of  a  nearly  40  per  cent,  decline  in  the  export 
trade,  a  imarked  decrease  in  the  production  of  iron  and 
steel  was  inevitable.  Evidently,  however,  the  climax  in 
the  period  of  depression  has  been  reached  and  passed. 
Within  the  last  month  or  so  there  has  been  a  gradual 
though  slow  improvement  in  the  situation.  As  a  result 
of  fairly  substantial  orders  for  rails  placed  recently  by 
the  Canadian  Pacific,  the  Canadian  National,  the  Grand 
Trunk,  and  the  Temiskaming  and  Northern  Ontario,  the 
plants  of  the  two  companies  engaged  in  the  industry  are 
assured  of  activity  for  some  months  to  come.  Steel  for 
structural  purposes  is  also  in  rather  better  demand. 
According  to  the  figures  for  October  furnished  by  the 
Dominion  Bureau  of  Statistics,  there  was  an  increase  of 
about  6,000  tons  In  the  production  of  pig  iron  during  that 
month,  while  the  output  of  steel  ingots  and  castngs, 
through  an  increase  of  16,000  tons,  was  the  largest  for 
any   month    in    the   year. 

Features  In  Pulp  and  Paper 

The  pulp  and  paper  industry,  like  all  other  Industries, 
has  experienced  its  ups  and  downs  during  the  year.  First 
there  was  the  wide-spread  strike  of  the  spring  and  early 
summer,  to  be  followed  later  by  the  closing  down  of  some 
of  the  smaller  and  newer  mills,  and  the  financial  difficul- 
ties, as  a  result  of  over-expansion,  of  the  Riordan  Pulp 
and  Paper  Company.  But  taken  on  the  whole,  the  reces- 
sion of  trade  experienced  was  less  marked  than  in  that 
of  almost  any  other  of  the  key  industries  of  the  country. 
The  export  market  for  newsprint  paper,  which  consumes 
about  80  per  cent,  of  the  Canadian  output,  has  taken  an 
upward  turn  during  the  last  month  or  two  and  production 
is  steadily  increasing.  The  extension  of  one  year  granted 
the  Riordan  Company,  and  the  starting  up  of  two  of  its 
plants,  with  probability  of  a  third  being  shortly  put  into 
operation,    have    naturally    tended    to    impart    a    healthier 


January  6,  1922. 


THE      MONETARY      TIMES 


209 


tone  to  the  industry.  As  a  result  of  additions  which  have 
been  made  to  plants  during  the  year  the  productive  capa- 
city of  the  pulp  and  paper  Industry  is  considerably  larger 
than  it  was  at  the  close  of  1920,  being  estimated  at  2,300,- 
000  tons  for  all  kinds  of  pulp  and  paper. 

Rxpericnco  of  Milling  Industry 

While'  the  milling  Industry  has  had  to  contend  with 
many  difficulties,  it  has  come  through  the  year,  all  things 
considered,  in  a  fairly  satisfactory  manner.  Having  to 
keep  large  Quantities  of  wheat  In  reserve,  it  necessarily 
follows  that  when  the  price  of  that  commodity  took  a 
tumble  the  mills  had  to  make  a  corresponding  reduction  in 
the  value  of  that  which  they  held.  Fortunately,  however, 
the  market  was  not  altogether  against  them,  they  having 
been  protected,  when  securing  export  orders  for  flour  tor 
future  delivery,  by  the  falling  murket  on  their  raw  mat- 
erial. In  catering  for  foreign  trade  competition  has  been, 
and  still  is,  very  keen,  not  only  among  domestic  mills, 
but  from  the  mills  of  the  United  States,  Argentina  and 
Australia.  But  in  spite  of  this  the  mills  of  Canada  exported 
2,868,271  barrel^  of  flour  valued  at  124,893,672  during 
the  six  months  ending  September  compared  with  1,947,710 
barrels  valued  at  123,460,944  the  corresponding  period  of 
1920.  All  the  big  milling  corporations  havn  during  the 
year  earned   profits  and  paid  dividends  to  shareholders. 

The  Textile  Industry 

The  cotton  mills  have  experienced  much  in  their  favor 
during  the  year.  Thanks  to  the  strikes  in  the  Lancashire 
cotton  industry  and  the  high  prices  obtaining  in  the 
United  States,  the  mills  of  Canada  have  during  the  past 
year  been  able  to  secure  a  large  share  of  the  home  market. 
As  a  result  they  have  been  better  employed  than  would  other 
wise  been  the  case.  The  fact  that  the  raw  market  has 
been  appreciating  in  price  the  mills  have  also  naturally 
been  saved  from  writing  down  inventories  in  respect  to 
this  material,  as  was  too  commonly  the  case  with  many 
other  branches  of  industry.  The  results  from  the  foreign 
trade  were  not  realized  by  the  woollen  industry  to  the 
extent  that  was  early  in  the  year  anticipated,  but  they 
have  on  the  other  hand  been  as  a  rule  fairly  well  employed 
in  supplying  the  home  trade,  and  it  is  understood  better 
prospects  are  looming  up  for  the  export  trade,  a  branch 
of  their  business  to  which  much  organized  attention  has 
been  given  during  the  last  year  or  two. 


Dull  Year  for  Lumber 

With  the  construction  of  large  buildings  temporarily 
suspended  at  home  and  the  export  demand  at  an  unusually 
low  point,  the  year  has  been  anything  but  a  favorable  one 
for  the  lumber  industry,  while  the  low  market  values 
obtaining  on  material  cut  when  costs  were  at  their  maxi- 
mum has  necessitated  substantial  losses  on  the  heavy 
stocks  standing  tin  the  yards  of  the  respective  companies. 
With  labor  and  supplies  costing  approximately  one-half 
that  of  a  year  ago  the  position  of  the  mills  In  respect  to 
this  winter's  operations  in  the  woods  promises  to  be  much 
more  favorable  than  was  the  case  during  1921.  In  the 
meantime,  the  export  situation  is  showing  signs  of  an 
improvement,  although  so  far  it  is  largely  confined  to 
the  mills  on  the  Pacific  coast. 

Other  IndOHtricfi 

A  dull  trade  has  been  experienced  throughout  the  year 
by  the  leather  industry,  but  an  improvement  has  recently 
been  experienced,  and  bringing  with  it  a  rather  firmer  tone 
to  prices.  The  revival  of  business  that  came  to  the  boot 
and  shoe  industry  early  in  the  last  half  of  the  year  has 
naturally  tended  to  improve  the  situation  with  the  leather 
trade. 

Owing  largely  to  the  marked  curtailment  in  the  demand 
on  export  account,  there  was  a  large  depreciation  in  the 
output  of  the  meat  packing  industry  during  the  year. 
Some  at  least  of  the  larger  packers  have  of  late  been  giving 
a  great  deal,  more  attention  than  was  their  practice  In 
the  past  to  the  cultivation  of  the  home  trade,  with  the 
result  that  some  compensation  for  the  decline  in  the 
export  trade  has  been  experienced. 

Benefit  has  naturally  accrued  to  the  cement  Industry 
from  such  large  undertakings  as  the  Chippawa  canal  and 
power  house  at  Queenston,  and  the  extensive  road-building 
operations  of  the  various  provinces.  Where  It  has  of 
course  experienced  a  diminished  demand  is  for  cement  used 
in  connection  with  the  erection  of  factory,  office  and 
public  buildings. 

Taken  as  a  whole,  there  is  a  marked  change  in  the 
industrial  situation  as  compared  with  the  beginning  of 
1921.  Then  it  was  like  a  ship  sailing  into  a  brewnig  storm, 
the  fury  and  results  of  which  could  not  be  determined. 
Now,  although  the  storm  may  not  yet  be  entirely  spent. 
the  clouds  are  gradually  disappearing  and  the  prospect 
brightening. 


Crop  Values  Far  Below  1920  Levels 

Reduction  in  Value  Per  Bushel  of  Wheat  and  Other 
Grains  Is  Cause — Rye  and  Grsun  Hay  Are  Only 
Products    That    Exceed    Previous    Year    in    Value 


"T^HE  Dominion  Bureau  of  Statistics  recently  issued  a  pre- 
*■  liniinary  estimate  by  provinces  of  the  value  of  this  year's 
field  crop.s  as  compared  with  the  final  e.«tiniates  of  the  two 
previous  years  1919  and  1920.  The  values  per  unit  assigned 
to  each  crop  represents  the  averages  received  locally  by  farm- 
ers, as  calculated  from  current  market  quotations.  They  are 
subject  to  revision  after  the  receipt  of  final  returns  from 
crop  correspondents  at  the  close  of  the  year. 

For  the  whole  of  Canada,  the  total  value  of  the  principal 
field  crops  of  1921,  as  now  pi-eliniinarily  estimated,  amounts 
to  $1,017,675,400,  as  compai'ed  with  the  final  estimates  of 
$1,4.'),''),2.14,().'")()  in  1920,  and  $1,,'')37,170,100  in  1919.  the  high- 
est aggregate  on  record.  The  total  for  1921  comprises  |283,- 
234,000  for  wheat,  as  compared  with  $427,357,300  in  1920,  and 
$457,722,000  in  1919;  $188,051,000  for  oats,  as  against  $280,- 
115,400  and  $317,097,000;  $30,282,000  for  barley,  as  against 
$52,821,400  and  $(;9,330,300;  $22,084,900  for  rye,  as  against 
$16,085,650  and  $14,240,000;  $43,389,500  for  other  grains,  as 
against  $86,296,700  imd  $114,250,000;  $84,616,000  for  pota- 
toes, as  against  $129,803,300  and  $118,894,200;  $296,799,000 
for  hay,  clover  and  alfalfa,  as  against  $366,571,900  and  $353,- 


892,400;  and  $69,219,000  for  other  root  and  fodder  crops,  as 

against  $97,192,400  and  $91,744,200. 

Prices  Are  Lower  Tills  Tear 

In  general,  the  unit  prices  are  considerably  less  than 
they  were  in  either  of  the  two  pi"eceding  years;  in  fact,  for 
wheat  the  price  per  bushel  for  1921  is  only  11  cents  above 
!":  pre-war  average,  whilst  for  oats  and  barley  the  prices 
per  bushel  are  somewhat  less.  As  compared  with  last  year, 
wheat,  for  the  whole  of  Canada,  averages  86  cents  per  bushel, 
as  against  $1.62  last  year;  oats  are  37  cents,  as  against  53 
cents,  and  barley  is  47  cents,  as  against  83  cents.  Other 
grain  prices  have  similarly  fallen.  The  average  for  potatoes 
is  76  cents  per  bushel,  as  against  97  cents  last  year  and  96 
cents  in  1919.  The  price  for  hay  and  clover,  viz.:  $23.25  per 
ton  compares  with  $26.10  last  year  and  $20,72  in  1919;  but 
the  yield  per  acre,  the  lowest  on  record,  causes  the  total  value 
to  be  nearly  $79,000,000  less  than  last  year. 

By  provinces,  the  total  value  of  the  field  crops  for  1921 
is  as  follows,  the  finally  estimated  toUls  for  1920  and  1919 
being  given  within  brackets:     Prince  Edward  Island,  $16,- 


210 


THE       MONETARY       TIMES 


530,500  ($18,530,400  in  1920  and  $22,367,400  in  1919);  Nova 
Scotia,  $33,992,500  ($47,846,550  and  $63,357,000)  ;  New 
Brunswick,  $38,051,400  ($46,357,300  and  $53,134,400)  ;  Que- 
bec, $192,773,000  ($330,251,000  and  $309,963,000)  ;  Ontario, 
$236,9(7,(00  ($375,746,900  and  $383,573,900);  Manitoba, 
$93,128,000  ($133,989,900  and  $182,097,200)  ;  Saskatchewan, 
$297,414,000  ($271,213,000  and  §340,029,800)  ;  Alberta,  $88,- 
985,000  ($204,291,500  and  $158,' 44,400)  ;  British  Columbia, 
$19,894,000  ($27,017,500  and  $24,603,000). 

PRELIMINARY  ESTIMATE  OF  THE  VALUE  OF  FIELD 
CROPS  IN  CANADA.  BY  PROVINCES,  FOR  1921.  AS  COM- 
PARED  WITH  THE   FINAL   ESTIMATES   FOR   1920. 


Average 
Price 
CANADA— 

Wheat     $1.62 

Oats     0.S3 

Barley     0.83 

Rye    1.33 

Peas    2.42 

Beans    3.88 

Buckwheat    1.28 

Mixed  Grains   0.90 

Flax    1.94 

Corn,    Husking    ....  1.16 

Potatoes     0.97 

Turnips,    etc 0.41 

Hay  and  Clover    ...  26.10 

Grain    Hay    33.12 

Fodder    Corn    7.75 

Sugar  Beets    12.80 

Alfalfa    23.79 

Total   field  crops.... 

P.  E.  ISLAND— 

Wheat     2.00 

Oats     0.70 

Barley     1.27 

Peas    3.00 

Buckwheat    1.30 

Mixed  Grains    0.85 

Potatoes     0.65 

Turnips  etc 0.39 

Hay  and   Clover    ...  26.00 

Fodder    Corn    10.00 

Total   field  crops. .  . . 

NOVA  SCOTIA — 

Wheat     2.15 

Oats     1.00 

Barley     1.51 

Peas     3.67 

Beans    6.00 

Buckwheat    1.36 

Mixed    Grains     1.32 

Potatoes     0.98 

Turnip.v,    etc 0.62 

Hay  and    Clover    ...  35.00 

Fodder    Corn    10.00 

Total   field   crops.. . . 

NEW  BRUNSWICK— 

Wheat     2.11 

Oats     0.60 

Barley     1.41 

Rye    1.80 

Peas    2.35 

Beans    3.39 

Buckwheat    1.46 

Mixed    Grains     1.17 

Potatoes     0.70 

Turnips,   etc 0.20 

Hay  and   Clover    ...  27.87 

Fodder   Corn    10.00 

Total  field   crops. . . . 

QUEBEC 

Wheat     2.24 

Oats     0.88 

Barley     1.41 

Rye 1.88 

Peas 3.36 

Beans 4.08 

Buckwheat    1.38 

Mixed    Grains    1.26 

Flax     3.57 

Corn,    Husking    ....  1.59 

Potatoes     1.00 

Turnips,    etc. 0.50 

Hay   and   Clover    ...  29.00 

Fodder    Corn    10.20 

Alfalfa    21.00 

Total  field  crops. .  . . 

ONTARIO— 

Wheat     1.87 

Oats     0.58 

Barley     0.94 

Rye    1.35 

Peas     2.00 

Beans    3.10 

Buckwheat    1.07 

Mixed    Grains    0.81 

Flax     2.43 

Corn.    Husking    ....  1.11 

Potatoes     0.97 

Turnips,   etc 0.28 


1920 

1921 

Average 

Total  Value 

Price 

Total  Value 

$427,357,300 

$0.86 

$283,234,000 

280,115,400 

0.37 

188,051,000 

52,821,400 

0.47 

30,282,000 

15,085,650 

0.86 

22,084,900 

8.534,300 

1.95 

■   6,206,500 

4,918,100 

2.66 

2,927,000 

11,512,500 

0.69 

5,868,000 

29,236,200 

0.50 

11,263,000 

15,502,200 

1.57 

6,859,000 

16,593,400 

0.72 

10,266,000 

129,803,300 

0.76 

84,616,000 

48,212,700 

0.36 

27,379,000 

348,166,200 

23.25 

269,457,000 

4,518,000 

11.23 

14,466,000 

43,701,000 

7.13 

40,199,000 

5,278,700 

6.50 

1,641,000 

13,887,700 

19.89 

12,866,000 

1,455,244,050 

1,017,675,400 

906,000 

1.15 

716,000 

3,567,000 

0.42 

2,414,000 

156,200 

0.50 

78,000 

8,100 

2.50 

8,500 

123,500 

0.60 

53,000 

473,000 

0.60 

277,000 

4,013,600 

0.46 

3,352,000 

1,359.000 

0.20 

804,000 

7,909,000 

30.00 

8,799,000 

15,000 

6.00 

29,000 

18,530,400 

16,530,500 

1.098,000 

1.25 

366,000 

4.614.000 

0.75 

3,132,000 

452,000 

1.00 

213.000 

7.S.500 

2.50 

24,000 

.il5,40n 

4.50 

245,000 

397.000 

0.80 

160,000 

265.000 

0.80 

110,000 

9.966.000 

0.95 

6,093,000 

5,368,000 

0.20 

977,000 

24,966.000 

29,25 

22,672,000 

116,000 

10.00 

95,000 

47,846,550 

33,992,500 

979,900 

1.50 

662,000 

5,470,600 

0.65 

4,488,000 

273,800 

0.85 

149,000 

6,500 

1.00 

8,400 

100,300 

2.50 

82,000 

234,200 

4.50 

149,000 

2,189,200 

0.80 

917,000 

118.200 

0.80 

82,000 

10,857,200 

0.90 

14,573.000 

1,414,100 

0.17 

1,054,000 

24,294,300 

25.00 

15,625,000 

419,000 

10.00 

262,000 

46.357,300 

38,051,400 

8.456,000 

0.98 

2,744,000 

58.722.000 

0.34 

18,911,000 

6.923,000 

0.60 

2,084,000 

1,004.000 

0.85 

371.000 

3,478,000 

2.50 

2.488.000 

2,632,000 

2.50 

1,378,000 

5,393,000 

0.60 

2,102,000 

5,286,000 

0.50 

2,019,000 

657,000 

1.58 

154,000 

2,258,000 

0.43 

536,000 

57,633.000 

0.80 

28,871,000 

13,765,000 

0.50 

8,467,000 

155,527,000 

27.00 

113,535,000 

7,089,000 

9.50 

7,613,000 

1,428,000 

23.26 

1,500,000 

330,251,000 

192,773,000 

43,003,100 

1.05 

16,440,000 

74,670,300 

0.45 

32,381,000 

15,6.-.3.200 

0.„5 

6,910,000 

3,176,200 

0.85 

1,801,000 

4,419,000 

1.50 

2,683,000 

1,181,100 

2.50 

1.094,000 

3,409,800 

0.76 

2,636,000 

20,709,000 

0.60 

7,883,000 

545,500 

1.58 

146.000 

14.335,400 

0.75 

9.730.000 

23,131,200 

1.00 

16,984,000 

,16,518,000 

0.36 

12,923,000 

1920 
Average 

Price  Total  Value 

Hay   and   Clover    ...  24.30  108,356,000 

Fodder    Corn    6.85  31,976,000 

Sugar  Beets    12.80  5,278,700 

Alfalfa    23.49-  9-,384,400 

Total   field   crops. ..  .  375,746,900 

MANITOBA— 

Wheat     1-83  68,769,000 

Oats     0.56  32,007,000 

Barley     0.80  13,988,000 

Rve    1.35  3,140,100 

Peas     1.10  68,400 

Mixed    Grains    1.87  1,144,000 

Flax     2.25  2,587,700 

Potatoes     ,-...      1.36  4,733,300 

Turnips,    etc 0.93  1,005,100 

Hay  and    Clover    ,,.  16.00  4,968,900 

Fodder    Corn    19.00  1,412,000 

Alfalfa    22.46  166,400 

Total   field  crops 133,989,900 

SASKATCHEWAN— 

Wheat     1.55  175,360,000 

Oats     0.41  58,035,000 

Barley     0.66  6,931,000 

Rye    1.26  3,194,000 

Peas     2.00  73,000' 

Beans    4.00  54,000 

Mixed    Grains     1.25  769,000 

Flax     1.82  10,383,000 

Potatoes     1.25  8,576,000 

Turnips,    etc 0.94  2,956,000 

Hay   and    Clover    ...  10.00  3,283,000 

Fodder    Corn    18.00  1,127,000 

Alfalfa    ,. 20.00  472,000 

Total   field   crops....  271,213,000 

ALBERTA— 

Wheat     1.52  126,861,000 

Oats     0.36  41,433,000 

Barley     0.62  7,898,000 

Rye    1.25  4,275,000 

Peas     2.00  98,000 

Beans    4. 00  ..156,000 

Mixed    Grains    1.00  252,000 

Flax     1.83  1,329,000 

Potatoes     1.011  7,138,000 

Turnips,    etc 1.00  3,219,500 

Hay  and  Clover    ,,.  20.00  9,972,000 

Fodder    Corn    18.00  585,000 

Alfalfa    24.00  1,075,000 

Grain    Hay    

Total   field  crops 204,291,500 

BRITISH  COLUMBIA— 

Wheat     2.20  1,924,300 

Oats     0.96  1,596,500 

Barlev     1.50  546,200 

Rve 2.02  279,200 

Peas     3.05  211,000 

Beans    1 .50  145,400 

Mixed    Grains                    1.25  220,000 

Potatoes     1.28  3,755,000 

Turnips,    etc 0.81  2,608,000 

Hav   and  Clover    ...  35.00  8,890,000 

Grain    Hay    33,12  4,518,000 

Fodder    Corn    17.75  962,000 

Alfalfa    33.71  1,361,900 

Total   field   crops....  27.017,600 


Volume  6S. 

1921 

Average 

Price 

Total  Value 

21.25 

86,794,000 

6.60 

27,923,000 

6.69 

1,641,000 

20.00 

9,038,000 

236,907,000 

1.00 

48,142,000 

0.33 

19,837,000 

0.44 

9,983,000 

0.90 

3,713,000 

2.50 

618,000 

0.44 

274,000 

1.58 

853,000 

0.45 

2,853,000 

0.27 

306,000 

13.00 

5,090,000 

9.00 

1,121,000 

17.00 

338,000 

93,128,000 

0.85 

171,696,000 

0.40 

84,541,000 

0.50 

6,645,000 

0.90 

14,790,000 

2.50 

122,000 

2.00 

31,000 

0.50 

404,000 

1.58 

5,530,000 

0.50 

5,172,000 

0.60 

800,000 

11.25 

5,015,000 

8.50 

2,199,000 

17.50 

469,000 

297,414,000 

0.70 

41,152,000 

0.23 

21,096,000 

0.32 

4,045,000 

0.50 

1.278,000 

2,00 

113,000 

2.00 

13,000 

0.25 

98,000 

1.30 

176,000 

0.60 

4,072.000 

0.30 

378,000 

10. 00 

4,549,000 

4.00 

280,000 

11.00 

400.000 

10 .  00 

11,335,000 

88,9«5,000 

1.20 

1,316,000 

0.50 

1,251,000 

0.60 

175,000 

1.00 

118,000 

2.60 

168,000 

2.50 

17,000 

0.60 

116,000 

0.90 

2,646,000 

0.67 

1,670,000 

23.68 

7,478,000 

20.20 

3.141,000 

14.50 

677,000 

23.70 

1,121,000 

19,894,000 

HOW  GRAIN  WAS  SHIPPED 


In  total  volume  of  grain  into  Montreal  port  from  May 
1  to  December  3,  the  rail  route  beat  the  water  route  by 
eleven  millions  of  bushels  in  the  biggest  grain  year  the 
port  has  ever  known.  According  to  figures  compiled  by 
the  secretary  of  the  Montreal  Board  of  Trade,  64,559,360 
bushels  of  grain  arrived  in  Montreal  by  lake  boats  as  com- 
pared with  75,557,069  bushels  by  rail  in  the  same  period. 
The  grand  total  of  grain  by  boat  and  rail  reached  the  enorm- 
ous total  of  140,036,445  bushels  of  all  grains,  a  volume  in 
excess  of  all  other  Atlantic  ports  combined,  from  Halifax 
to  Philadelphia  and  Newport  News,  including  the  port  of 
New  York. 

The  figures  up  to  December  3  show  the  following  pro- 
portions carried  by  rail:— 

May  1  to  Decemljer  3 

By  Rail  By  Water         Total 

Bushels  Bushels  Bushels 

Wheat   29,987,834       26,664,775       56,652,609 

Corn     19,859,277       25,734,166       45,593,443 

Oats     14,537,498         7,852,169       22,389,667 

Barley     4,949,028         2,050,251         6,919,269 

Rye    4,625,449         1,897,559         6,523,008 

Flax 1,598,003  360,446         1,958,449 

Total    75,557,069       64,559,356     140,036,445 


January   6,   1922. 


THE      MONETARY      TIMES 


211 


Ontario's  Industrial  Activity  Curtailed  in  1921 

But  Results  Attained  in  Manufacturing  Centres  of  the  Province  Vere 
Better  Than  Generally  Anticipated — The  Fall  Showed  Revival  of 
American  Branch  Plant  Movement — Good  Amount  of  New  Enterprise 


ONTARIO,  the.  greatest  province  in  Canada,  in  more  ways 
than  one,  but  particularly  in  industry,  jjoth  primary 
and  otherwise,  generally  speaking,  has  not  had  such  a 
bad  year  after  all.  That  opinion  is  based  on  reports  from 
the  various  hoards  of  trade  in  the  chief  centres.  These  -. 
statements  do  not  speak  very  much  of  unravorable  fea- 
tures, and  no  doubt  in  an  effort  to  be  optimistic,  such 
things  have  been  omitted  or  spoken  of  hurriedly.  Of 
course,  everybody  is  aware,  and  admits  the  fact  of  cur- 
tailment in  industry,  in  which  several  companies  were 
seriously  affected,  but  on  the  whole  it  is  quite  encouraging 
to  see  the  amount  of  enterprise,  and  In  surveying  the 
various  manufacturing  centres,  the  number  of  new  con- 
cerns Vitarting  business,  particularly  •!■■■  rviller  ones,  is 
surprising. 

In  the  years  1919  and  1920,  a  big  movement  in  the 
establishment  of  branch  plants  in  Canada  by  American 
companies  took  place.  Naturally  this  came  to  an  end 
when  industrial  depression  loomed  on  the  horizon,  and 
throughout  the  period  of  reaction  very  little  work  of 
this  nature  was  proceeded  with.  Hut  when  the  tall  came, 
and  business  showed  signs  of  picking  up,  the  movement 
started  again,  and  in  the  latter  months  of  the  year  many 
such  companies  started  operations  in  the  province,  with 
the  prospects  of  a  large  number  of  others  coming  here  in 
the   near    future. 

Toronto  Continues   (o  E.xpand 

No  industrial  review  of  Ontario,  or  of  Canada  for  that 
matter,  would  be  complete  without  some  mention  of 
Toronto,  tor  the  city  enjoys  the  distinction  of  being  the 
financial  centre  of  not  only  of  Ontario,  but  of  English- 
speaking  Canada.  Toronto,  like  most  other  cities,  exper- 
ienced a  curtailment  of  industrial  activity  during  1921, 
which,  of  course,  meant  »  good  deal  of  unemployment. 
But  much  of  this  was  off-set  by  developments  in  other 
lines,  particularly  in  connection  with  the  harbour  and  the 
rehabilitation  of  the  street  railway. 

It  might  well  be  said  that  a  feature  of  the  city's 
industrial  experience  last  year  was  the  taking  over  of  the 
street  railway  from  the  Toronto  Railway  Company,  which 
resulted  in  the  commencement  of  the  reconstruction  of 
the  system.  Old  tracks  and  roads  have  been  torn  up,  and 
new  ones  laid  in  their  stead.  New  cars  have  also  been 
installed.  Some  $10,000,000  was  raised  for  this  work, 
and  it  is  likely  that  before  the  system  Is  restored  to  good 
order,  more  will  be  spent.  It  will  be  recognized  that  not 
only  was  work  supplied  to  thousands  of  men  In  rebuilding 
the  new  system,  but  Incidental  industries,  such  as  those 
which  manufacture  cement,  steel  rails  and  accessoriea., 
cars,'  etc..  would  be  quickened  by  the  demand  for  their 
products.  In  regard  to  these  manufactures,  however,  the 
industries  of  Toronto  took  very  little  part,  a  great  deal 
of  the  work  being  done  outside. 

In  a  survey  of  conditions  during  the  past  year,  B.  L. 
Cousins,  chief  engineer  and  manager  of  the  Toronto  Har- 
bour Commission,  and  industrial  commissioner  for  Toronto, 
states  to  The  Monetary  Times:  — 

"In  the  eleven  months  ending  November  30th  more 
than  a  score  of  new  Industrial  firms  have  located  in  Tor- 
onto. The  fact  that  the  year  1921  will  not  equal  1920  in 
the  number  of  new  concerns  commencing  business  in  this 
city  is  naturally  attributable  to  the  general  depression 
of  business. 

"Another  cause  for  many  American  companies  post- 
poning the  establishment  of  Canadian  branches  has  been 
the  high  cost  of  construction  and  building.  The  number 
of  firms  who  did,  however,  commence  operations  In  Tor- 
onto during  the  past  year  has  been  more  than  naturally  ex- 


pected and  this  city  has  received  a  very  satisfactory  pro- 
portion of  those  who  came  to  Canada  from  other  countries. 

"During  the  past  few  months  a  very  decided  increase 
in  business  optimism  is  noticeable  In  interviews  with  Can- 
adian and  American  industrial  leaders.  The  general  feel- 
ing is  that  the  depression  Is  over  and  busy  times  Just  a 
block  ahead.  U  is  generally  believed  that  the  early  monthn 
of  1922  will  see  a  return  to  prosperous  times. 

'Many  American  and  British  concerns  are  now  acti»>:. 
investigating  the  Canadian  market  from  the  viewpoint  o: 
establishing  branch  plants  and  a  number  of  Canadian  firms 
are  considering  expansion  and  more  modern  facilities. 

"The  new^  areas  being  developed  by  the  Toronto  Har- 
bor Commissioners  in  the  Eastern  Harbor  Terminals  for 
Industries  requiring  large  areas  of  land  and  In  the  Central 
Harbor  Terminals  for  warehousing  and  light  manufactur- 
ing, are  receiving  much  attention.  The  fact  that  these  new 
properties  have  everything  to  offer  in  the  way  of  transn<ir- 
tation,  both  by  rail  and  water,  electric  power  and,  In 
every  facility  a  manufacturer  might  require,  has  pu^^^ 
Toronto  in  a  pre-eminent  position  for  securing  new  Indus- 
tries. 

"In  the  United  States,  especially  the  deflation  of  prices 
has  proceeded  more  rapidly  than  in  Canada  and  that  coun- 
try now  having  reached  the  turning  point  In  business  it 
can,  I  think,  be  confidently  expected  that  Toronto  will,  dur- 
ing 1922,  receive  more  new  industries  than  in  any  prev- 
ious year." 

Hamilton  Fairly  Prosperons 

While  the  abnormal  conditions  existing  during  th> 
past  year  have  militated  against  industrial  expansion. 
Hamilton  has  enjoyed  a  fair  measure  of  industrial  pros- 
perity, nineteen  new  Industries,  several  of  them  Canadian 
branches  of  American  concerns,  having  located  here  since 
the  beginning  of  the  present  year.  With  but  few  excep- 
tions, however,  the  newcomers  are  occupying  buildings 
formerly  occupied  by  other  industries,  there  having  been 
less  industrial  building  during  the  past  year  than  in  any 
twelve  months  since  the  close  of  the  war.  This  has  been 
due  largely  to  the  unsettled  conditions  throughout,  not 
only  the  Continent  of  America,  but  practically  the  entire 
world.  With  the  future  somewhat  beclouded,  the  manu- 
f.-tcturer  has  shown,  and  is  still  showing,  a  tendency  to 
move  more  cautiously  than  was  the  case  during  the  pros- 
perous war  years  and  the  two  years  Immediately  follow- 
ing, and  wherever  possible  he  has  secured  a  short-ten. 
lease  on  an  existing  building,  rather  than  tie  up  consider 
able  capital  in  building  to  suit  his  own  requirements,  when 
there  is  so  much  uncertainty  regarding  what  the  future 
holds  in  store.  Unsettled  building  conditions  have  also 
had  a  detrimental  effect,  there  being  a  feeling  com"i'in 
to  all  classes  that  building  costs,  both  labor  and  mai- 
are  bound  to  take  a  drop.  There  has  already  oeen  a  ..-.. 
slderable  decline  In  building  costs,  but  it  has  been  so 
gradual  that  it  has  scarce  been  noticed,  although  rerr 
substantial  In  the  aggregate  and.  at  least,  so  far  as  Ham- 
ilton Is  concerned,  there  are  unmistakable  signs  that  if 
the  decrease  Is  maintained  until  next  spring,  the  next 
year  is  going  to  be  an  exceptionally  busy  one  for  the 
building  trades. 

While  it  cannot  be  said  that  Hamilton  manufacturer* 
have  been  marking  time,  it  cannot  be  denied  that  the 
depresaiorf  of  the  past  year  has  been  pretty  generally  felt 
and  that  few,  if  any,  industries  have  enjoyed  even  a  normal 
year.  Not  many  have  found  It  necessary  to  close  their 
doors  entirely,  even  temporarily,  but  almost  without 
exception  they  have  at  some  time  during  the  year  been 
forced  to  curtail  production,  either  by  shortening  hoars 
of  operation  or  reducing  their  staffs.      As  a  result,  there 


212 


THE      MONETARY      TIMES 


Volume  68. 


has  been  an  unusual  amount  of  unemployment,  but  In 
this  regard  a  marked  improvement  has  been  shown  during 
the  early  tall  months,  and  there  is  every  reason  to  believe 
that  the  peali  has  been  reached  and  passed  and  that  the 
next  twelve  months  will  see  a  gradual  return  to  normal 
conditions,  with  both  wages  and  living  costs  lower  than 
they    have   been    during   the    past    few   years. 

Belleville  Had  Active  Year 

A  list  of  the  more  important  Industrial  developments 
at  Belleville  during  1921  Indicate  that  the  city  had  a  fairly 
busy  year,  notwithstanding  the  depression. 

The    organization    of    the   Tiger   Tire   and    Rubber    Co., 
and    its    development    into    a    going    concern.      About      85 
employees.        The     organization     and     building   of  a  new 
foundry,   known   as   the  National   Castings   Limited. 

Development  of  Natural  Tread  Shoes,  Limited,  as  a 
going  concern,  for  the  manufacture  of  that  type  of  shoe, 
with  branch  stores  for  the  retail  trade  of  same  in  Peter- 
borough,   Belleville   and   Toronto. 

The  Alemite  Co.  of  Canada,  a  branch  of  the  Basslck 
Mfg.  Co.,  of  Chicago,  for  the  manufacture  here  of  the 
famous  Alemite  lubricating  system  for  automobiles. 

Reorganization  of  the  Asbestos  Pulp   Co.,   Limited,  for 
the    manufacture    and    preparation    of    various    talc    pro- 
ducts.    Not     likely   to  commence    operations  here  before 
the  spring  of   1922. 

Ashley  Knitting  Co.,  for  the  manufacture  of  sweaters 
and  other  knitted  products.  Not  a  large  employer  of 
labor  as  yet,  but  likely  to  increase  its  staff.  Enlargement 
of  the  Springer  Lock  Mfg.  Co.,  by  a  wing  that  will  greatly 
increase   its  capacity. 

Welland  Iiooks  to  Busy  Future. 
While  Welland  'has  not  had  such  a  busy  year  inaus- 
trially,  1922  offers  great  promise.  The  Joseph  Stokes 
Rubber  Company  of  New  Jersey  erected  a  plant.  The 
building  is  composed  of  brick  construction.  The  plant  is 
now  under  operation  and  employing  about  50  people,  but 
they  expect  to  employ  in  a  normal  production  period 
about   80   hands. 

The  Scottish-Canadian  Fertilizer  Company  of  Soot- 
land,  is  now  erecting  a  steel  fabricated  fertilizer  plant 
that  will  cost  in  the  neighborhood  of  $100,000.  This 
plant  is  expected  to  employ  about  100  people  when  com- 
pleted. They  expect  to  enter  production  early  this 
year. 

Hydro  Appliances  Limited,  a  new  corporation  of  Can- 
adian capital,  has  purchased  the  Dominion  Canners'  plant 
at  Port  Robinson  and  have  taken  over  the  Canadian 
rights  of  a  patent  electric  washer  now  produced  in  the 
United  States.  This  company  started  delivery  of  their 
products  about  December  1st. 

Th.e  National  Cooperage  Company  have  purchased  the 
plant  of  the  Supreme  Heating  Company  in  Welland.  In 
this  plant  a  patented  automatic  barrel  with  tongue  and 
grooved  staves  will  be  produced.  This  barrel  is  made 
entirely  by  machinery  which  is  now  being  constructed  in 
Windsor.  It  is  expected  that  the  installation  of  the 
machinery  will  begin  about  January  1st.  This  plant 
expects  to  employ  about  30  or  40  people. 

Over  100  American  and  British  firms  are  making 
enquiries  in  regard  to  the  Welland  district,  and  negotia- 
tions are  on  with  several  other  plants  that  look  hopeful 
for  closing,  so  that  construction  of  the  plants  can  start 
early  in  the  year  1922. — Industrial  Commissioner,  Welland. 

Pulp  Company  at  Fort  William 

The  most  Important  item  of  industrial  development  in 
Port  William  during  the  year  was  the  completion  of  the 
pulp  plant  of  the  Fort  William  Paper  Company  Ltd.  This 
plant  is  located  on  what  is  known  as  the  Mission  Site  of 
the  Fort  William  water  front.  It  began  actual  operation 
on  April  30th  last,  and  has  been  in  continuous  operation 
since  that  date,  the  capacity  being  2  50  tons  of  dry  pulp 
per  day. 

Additions  have  been  made  to  several  of  the  existing 
grain  elevators.  Additions  have  also  been  made  to  the 
plant  of  the  Canada  Iron  Foundries. 


Operations  of  the  Canada  Car  &  Foundry  Company 
were  temporarily  suspended  for  lack  of  orders,  but  was 
resumed  and  well  under  way  before  the  close  of  the  year. 

No  industries  have  moved  away  during  the  present 
year.  With  the  exception  of  the  Canada  Car  &  Foundry 
Co.  plant  all  industries  have  been  fully  occupied  and 
operating. 

New  Industries  for  Woodstock 

Wodstock  is  a  woodworking  and  textile  centre.  Dur- 
ing the  summer  months  the  textile  industries  were  fairly 
busy  and  at  the  present  time  are  operating  to  capacity, 
in  fact,  working  over  time,  and  prospects  are  that  the 
different  factories  here  will  be  busy  until   spring. 

As  regards  the  woodworking  industries,  they  have  all 
been  very,  very  quiet  during  the  summer  months.  Several 
of  them  were  shut  down  for  short  periods  and  are  at 
present  operating  on  short  time  with  reduced  staffs.  How- 
ever, during  the  recent  months,  orders  have  been  com- 
ing in  a  little  more  freely,  and  the  prospects  seem  to 
be  that  business  will  be  fairly  good  until  the  end  of  Jan- 
uary.    After  that  time,  no  one  knows. 

A  remarkable  feature  about  the  labor  situation  here 
is  that  during  the  summer  months  a  large  number  of  men 
who  were  laid  off  found  work  to  do  of  some  kind  or  other 
and  not  many  were  in  a  position  of  being  unable  to  find- 
any  work  of  any  kind.  The  metal  trades  are  busy,  par- 
ticularly in  the  stove  industry. 

During  the  year  five  new  industries  established  them- 
selves in  Woodstock.  The  KIrsch  Mfg.  Co.,  of  Sturgis, 
Mich.,  manufacturers  of  curtain  rods  and  house  furnish- 
ings; Candian  Ironing  Machine  Co.,  manufacturers  of  the 
Simplex  ironing  machine;  the  Milko  Co.  Ltd.,  a  local 
organization,  manufacturing  milk  products;  Lewis  E. 
Myers  &  Co.,  of  Valpraiso,  Ind.,  manufacturers  of  desks. 

The  city  has  been  very  active  this  year  in  permanent 
improvements.  The  city's  area  of  permanent  streets  has 
doubled  in  the  past  ten  months,  at  a  construction  cost  of 
$162,539,  with  a  total  expense  for  permanent  local  im- 
provements of  $214,035. — Secretary  Woodstock  Board 
of  Trade. 

Peterborough  Affected  Slightly 

Owing  to  the  diver-nature  of  the  local  industries  the 
general  trade  depression  during  the  past  year  has  not 
affected  Peterborough  to  any  great  extent,  as  compared 
with  other  industrial  centres. 

There  have  been  no  shut-downs  during  the  present 
year.  During  the  first  half  of  the  year  the  textiles  were 
very  s'ow,  owing  to  the  falling  off  in  the  wool  market, 
and  by  July  conditions  brightened  again,  and  at  the  pres- 
ent date  the  textile  industry  is  brisk.  The  iron  trades 
have  fallen  off  during  the  past  few  months,  but  are 
expected  to  resume  normal  conditions  about  the  first  of 
next  year. 

St.  Catharines,  Ontario 

During  the  past  year  two  new  industries  have  located 
in  St.  Catharines,  and  while  they  are  beginning  in  a  small 
way,  there  is  every  indication  that  their  business  will 
develop  to  large  proportions  with  the  return  of  normal 
conditions.  There  has  also  been  considerable  activity  in 
the  establishment  of  small  industries  that  may  in  the 
course  of  time  grow  to  considerable  size. 

On  account  of  the  existing  conditions,  there  has  not 
been  much  expansion  among  the  older  concerns.  The 
majority  of  the  larger  factories  are  operating  with  a 
reduced  staff,  while  one  or  two  of  the  smaller  plants  have 
practically  closed   down   temporarily. 

Indications,  however,  point  to  an  increased  industrial 
activity  at  an  early  date,  one  concern  having  sufficient 
orders  that  will  enable  them  to  operate  at  full  capacity 
in  the  very  near  future.  Other  companies  have  also 
reported  recently  a  slight  increase  in  business. — Manager 
St.   Catharines  Chamber  of  Commerce. 

Normal  Year  for  Stratford 

Stratford  is  essentially  the  centre  for  the  manufacture 
of  high-grade  furniture,  but  there  is  also  a  large  and 
varied  line  of  other  industries. 

While   no   new   industries   began   operations   last  year. 


January   6,   1922. 


THE      MONETARY      TIMi: 


213 


a  number  Increased  their  lines  of  manufacture.  The  Mc- 
Lagan  Phonograph  Co.  Ltd,  greatly  Increased,  and  the 
Kindel  Bed  Co.  Ltd.  also  added  an  addition.  Duftons' 
Ltd.  have  greatly  enlarged  their  plant  and  are  now  making 
velour.?,  suitings,  etc. 

Most  o£  the  factories,  exclusive  of  the  textiles,  are 
working  practically  to  their  normal  capacity. — Secretary- 
Manager  Stratford  Chamber  of  Commerce. 

Chatham  Indu-stries  on  Part  Time 

The  ^ack  Furnace  Co.,  manufacturing  pipe  and  pipe- 
less  furnaces;  International  Speed  Truck,  manufactured  by 
the  International  Harvester  Co.;  Weaver  Canadian  Co., 
branch  of  a  U.  S.  concern,  manufacturing  automobile 
accessories;  the  Excelsior  Knitting  Mills,  manufacturing 
knitted  goods.  These  were  some  of  the  important  addi- 
tions which  were  made  to  the  industrial  lite  of  the  city 
in   1921. 

Like  other  cities,  our  manufacturers  are  very  quiet, 
and  only  running  part  time. — W.  R.  Langdon,  Chamber 
of  Commerce,  Chatham,  Ont. 

Consideiablo   BuiidinK  at   Gait 

There  has  been  considerable  activity  in  the  building 
trade  at  Gait  during  the  past  year,  although  as  far  as 
additions  to  industrial  plants  were  concerned,  there  was 
little  work.  The  principal  outlays  for  the  year  were 
1500,000  on  municipal  improvements,  and  $200,000  on  a 
new  structure  for  the  Public  Utilities  Commission.  The 
Royal  Bank  of  Canada  saw  fit  to  erect  a  new  building, 
which  indicates  that  business  was  not  so  bad  there  as 
might  have  been  supposed  by  the  record  of  other  places. 

New  industries  which  started  during  the  year,  having 
found  accommodation  in  existing  buildings,  nclude  the 
Arrow  Signal  Lamp  Company;  Beaver  Saw  Works;  Gait 
Chemical  Products,  Limited;  Gait  Wood  Products  Com- 
pany; Gill  Brass  Goods  Manufacturing  Company;  Hi-Speed 
Tools  Company;  A.  E.  Johnston,  manufacturer  of  wicker 
.  furniture,  and  the  Stevens  Pattern  Company. — Secretary 
Gait  Board  of  Trade. 

Border  Cities  Optimistic 

You  have  asked  for  a  few  words  on  the  more  Important 
industrial  development  that  has  taken  place  in  these  Border 
Communities  within  the  past  twelve  months.  I  might  say 
that  some  twenty-eight  small  concerns  have  established  dur- 
ing that  period.  All  of  these  appear  to  be  doing  remark- 
ably well. 

We  have  had  no  large  industrial  development  during 
1921  tor  the  obvious  reason  that  big  manufacturers  natur- 
ally hesitate  to  embark  upon  any  extensive  capital  expend- 
iture with  the  inevitable  prospect  of  writing  oft  a  consid- 
erable percentage  of  same  within  six  months  or  a  year 
thereafter. 

I  might  say,  however,  that  reverting  to  Horace,  who  If 
I  remember  aright,  remarked  a  tew  years  before  the  Chris- 
tian era  that  in  times  of  peace  the  wise  individual  made 
suitable  preparation  for  war;  and,  I  think  this  applies  en- 
tirely to  the  situation.  When  manufacturers  were  hyster- 
ically busy  with  fictitious  orders  they  had  no  time  to  con- 
sider their  Canadian  possibilities;  but,  to-day,  when  can- 
cellations have  reduced  their  orders  very  materially,  they 
are  beginning  to  look  around; — and,  for  the  first  time,  we 
are  finding  Americans  really  seriously  considering  their  Can- 
adian possibilities.  As  a  result,  innumerable  enquiries 
are  being  received  from  such  good  people.  They  want  to 
know  this  and  they  want  to  know  that; — and  they  recog- 
nize that  the  business  of  a  Continent  while  sparsely  popul- 
ated, is  nevertheless  as  large  as  Europe,  is  something 
worth  going  after  in  an  intelligent  way. 

During  the  past  two  months,  I  have  received  more  en- 
quiries with  regard  to  the  industrial  recommendations  of 
the  Border  Cities  than  during  the  previous  two  years;  and 
I  am  glad  to  say  that  many  of  such  enquiries  are  very  im- 
portant. 

So  tar  as  the  present  is  concerned,  we  are  not  conscious 
in  a  serious  sense  of  the  tragic  unemployment  situation 
which  has  disrupted  less  favored  Ontario  industrial  centres. 


It  is  true  that  we  have  not  been  as  busy  as  we  would  like 
to  have  been.  Nevertheless,  we  have  been  well  employed; — 
and,  so  far  as  the  future  is  concerned,  we  do  not  see  why 
there  Is  any  reason  that  we  should  clothe  ourselves  In 
sackcloth  and  ashes.  As  a  matter  of  fact,  we  are  entirely 
encouraged;  we  have  never  lost  heart;  we  have  had  no 
reason  to  lose  heart;  and  we  confidently  believe  that  we 
have  the  greatest  future  of  any  industrial  centre  In  the  en- 
tire Dominion  of  Canada,  and  we  believe  It  with  logical  rea- 
son. F.  Maclure  Sclanders,  commissioner  Border  Chamber 
of  Commerce. 

Saalt  Stc.  Marie 

In  spite  of  the  general  business  depression,  Sault  Ste. 
Marie  has  come  through  the  year  1921  without  a  single 
mercantile  failure  of  any  importance  and  with  a  compar- 
ative small  amount  of  unemployment. 

During  the  month  of  March  the  plant  of  the  Algoma 
Steel  Corporation  suffered  a  partial  shut  down  due  to  lack 
of  orders  and  for  nearly  eight  weeks  beginning  early  in  May. 
work  was  suspended  by  the  Spanish  River  Pulp  &  Paper 
Mills  Ltd.  on  account  of  the  paper  makers'  strike.  These 
two  great  industries,  as  well  as  the  smaller  industries  in  the 
city,  have  since  been  operating  at  from  75  to  100  per  cent 
capacity. 

In  September  last  the  Everett  Manufacturing  Co.  Ltd., 
formerly  of  Chicago,  began  the  erection  of  a  factory  for  the 
manufacture  of  ironing  boards  and  other  lines  of  wooden 
ware.  It  is  expected  that  the  company  will  begin  opera- 
tions early  in  January  next. 

Considering  general  conditions,  there  has  been  marked 
activity  In  the  building  trades  throughout  the  year.  One 
feature  was  an  addition  to  the  plant  of  the  Great  Lakaa 
Power  Co.  costing  over  $1,000,000.  Secretary  Sault  Ste. 
Marie  Board  of  Trade. 

Stability  In  Kitchener 

The  outstanding  feature  of  the  industrial  situation  In 
Kitchener  during  the  past  year  has  been  an  evident  stab- 
ility despite  the  abnormal  conditions  that  have  prevailed 
during  the  last  year  and  a  half:  Unemployment  hit  the 
city  like  others  but  the  shock  was  not  felt  to  the  same  extent 
as  in  many  other  cities  and  towns.  The  local  conditions 
also  revealed  more  resiliency  In  the  trend  to  return  to 
normal  or  something  lilie  it. 

The  rubber  Industry  was  among  those  which  were  hit 
hardest  by  the  slump,  especially  in  the  tire  line,  the  export 
trade  which  formed  a  large  share  of  the  trade  having  been 
cut  oft.  The  furniture  industry  also  was  hit  hard.  Condi- 
tions in  the  last  named  line  are  Improving  steadily  as  they 
are  in  most  other  lines  and  the  outlook  for  the  next  year 
Is  comparatively  good.  The  prices  of  houses  have  come 
down  slightly,  possible  ten  per  cent.,  for  the  buyer,  but 
rents  remain  as  high  as  ever. 

One  feature  that  Is  noteworthy  Is  the  fact  that  the  plant 
of  the  Dominion  Sugar  Company  did  not  operate  this  year. 
This  plant  in  other  seasons  relieved  the  unemployment  eit- 
nation  because  it  required  300  to  400  men  to  operate  the 
plant.  It  is  expected  that  the  plant  will  again  be  running 
next  year.  Its  operations  during  the  three  or  four  months 
in  the  fall  and  winter  season  have  been  an  asset  to  the 
community. 

Sevofal  Industriee  For  BranUonl 

Additions  to  factories  this  year  have  been  few  and  far 
between.  A  number  however  have  taken  advantage  of  the 
opportunity  presented  through  the  unemployment  period  of 
thoroughly  renovating  and  repairing  their  plants:  th-s  has 
given  work  to  quite  a  number  of  men. 

.\  few  of  the  larger  establishments  are  working  short 
time  and  on  the  relay  system,  that  is,  one  group  of  men 
may  work  three  days  and  another  group  of  men  carry  on 
for  the  next  three  days  and  so  on,  the  effort  has  been  to  pro- 
vide employment  first  for  married  men  with  families.  Dur- 
ing the  year  the  Dominion  Flour  Mills  erected  an  eleTator 
with  a  capacity  of  100,000  bushels. 

Some  sixteen  industries,  mostly  small,  were  established 
during  the  year.  Manager  Brantford  Chamber  of  Com- 
merce. 


214 


THE       MONETARY       TIMES 


Volume  68. 


Industry  in  Quebec  and  Maritimes 

While  Business  Was  Not  By  Any  Means  Brisk,  It  Was  Characterized  By 
StabiHty — Sherbrooke  Had  An  Active  Year — Ordinary  Developments  in 
Maritime     Provinces,     But     Outlook     Is     Better     Than     a     Year     Ago 


NOT  having  experienced  the  same  feverish  activity  as 
was  found  in  Ontario  and  Western  cities  in  1919  and 
part  of  1920,  Quebec  and  the  Maritime  Provinces  did  not 
suffer  the  pangs  of  readjustment  to  the  same  degree. 

The  trade  situation  in  Quebec  last  year  was  not  exactly 
brisk,  but  it  was  steady.  Building  permits  in  Montreal  and 
"Quebec  city  showed  increases,  as  compared  with  substantial 
decreases  in  other  of  Canada's  largest  cities.  Municipal 
assistance  to  industries  is  now  forbidden  by  provincial  law, 
but  notwithstanding  there  are  several  good  prospects.  Sher- 
Jbrooke  showed  notable  expansion  during  the  year. 

As  regards  the  Maritimes,  there  is  not  much  to  say. 
Business  was  not  characterized  by  any  feature,  but  stability 
was  in  evidence.  St.  John,  N.B.,  is  the  only  city  which  has 
jiotable  events  to  report. 

It  is  not  necessary  to  look  far  afield  for  evidence  of 
increasing  activity  of  business.  Though  opinions  regarding 
the  business  outlook  vary  considerably,  there  is  no  question 
that  the  improvement  in  business  which  set  in  last  summer 
still  continues.  Industrial  and  commercial  activity  is  grow- 
ing and  unemployment  is  decreasing.  That  is  the  local  con- 
dition, but  improvement  in  general  can  never  continue  unless 
it  is  backed  by  national  and  international  improvement.  The 
fall  in  prices  of  farm  products  serves  to  still  further  cripple 
the  buying  power  of  the  agricultural  districts,  and  makes 
impossible  that  full  and  free  exchange  of  the  products  bf  the 
farm  and  factory  on  an  equitable  basis,  which  is  necessary 
for  good  business.  Further  readjustment  of  prices  of  manu- 
factured goods  must  take  place.  There  is  the  situation. 
Agriculture  is  our  greatest  industry  and  until  its  buying 
power  is  restored  either  by  a  rise  in  the  prices  of  agricultural 
products,  or  by  a  fall  in  prices  of  manufactured  products, 
we  cannot  have  industries  fully  employed.  The  same  things 
may  be  said  of  our  second  largest  industry,  the  railroads. 
Their  buying  power  is  very  limited. 

Increasing  Activity  in  Sherbrooke 

The  industrial  development  during  the  year  1921  in 
Sherbrooke  has  been  satisfactory  from  many  points  of  view. 
The  completion  of  the  new  plant  of  the  Canadian  Connecticut 
Cotton  Mills,  manufacturers  of  tire  cotton  fabrics,  represents 
an  investment  of  over  $5,000,000  and  in  normal  times  will 
give  employment  to  over  2,000  employees. 

The  new  plant  of  the  Julius  Kayser  Company  was  com- 
pleted this  year.  Their  production  consists  of  high-grade 
silk  gloves,  hosiery  and  underwear  and  represents  an  invest- 
ment of  over  $3,000,000  and  gives  employment  to  about 
1,000  employees. 

The  Superheater  Company,  Ltd.,  manufacturers  of 
superheaters  for  locomotives,  marine  and  stationary  boilers; 
number  of  employees,  150;  cost  of  plant,  $250,000. 

The  extension  of  the  Sherbrooke  Machinery  Company, 
manufacturers  of  pulp  and  paper  machinery,  was  erected 
at  a  cost  of  $100,000,  and  will  enable  this  concern  to  double 
its  production;  number  of  employees,  100. 

J.  H.  Bryant,  Ltd.,  manufacturers  of  aerated  waters, 
is  one  of  the  most  modem  plants  of  its  kind  in  the  country, 
which  was  erected  at  a  cost  of  $75,000.  This  concern  is  do- 
ing good  business  and  their  products  are  being  sold  all  over 
the  country.     They  give  employment  to  over  50  employees. 

The  new  plant  of  the  Canadian  Sturdy  Chain  Company, 
manufacturers  of  high-grade  gold,  silver  and  platinum  jew- 
elry, was  erected  at  a  cost  of  $50,000.  This  new  organization 
will  give  employment  to  a  personnel  of  150. 

Goupil,  Ltd.,  manufacturers  of  chocolate,  candy  and  ice 
cream,  have  erected  a  modern  plant  of  brick  construction 
at  a  cost  of  $50,000,  and  give  employment  to  about  50  em- 
ployees. 


The  Office  Requirements,  Ltd.,  manufacturers  of  blank 
books,  loose-leaf  system,  rubber  stamps,  etc.,  purchased  a 
three-storey  building  at  a  cost  of  $50,000  on  the  main  busi- 
ness thoroughfare.  This  concern  is  doing  good  business  and 
have  a  progressive  management.     They  employ  50  employees. 

The  new  plant  of  the  Pressure  Proof  Rings,  Ltd.,  manu- 
facturers of  piston  rings,  was  also  completed  this  year  at  a 
cost  of  $25,000.     Number  of  employees,  25. 

Another  new  industry  for  Sherbrooke  is  the  Canadian 
Vesta  Battery  Company,  Ltd.,  manufacturer's  of  automobile 
batteries  and  is  an  additional  link  in  making  Sherbrooke 
an  automobile  centre.  At  present  we  have  large  factories 
manufacturing  automobile  tires,  tire  cotton  fabrics,  rubber 
accessories  and  piston  rings. 

In  reference  to  the  industrial  situation  in  Sherbrooke 
at  the  present  time,  we  can  say  with  satisfaction  that  during 
the  last  depression,  not  one  of  our  plants  has  been  shut  down, 
although  some  had  to  curtail  production,  but  to-day  we  find 
all  our  industries  busy  and  increasing  their  production.  The 
increase  in  incoming  orders  are  in  evidence  more  and  more 
as  we  are  nearing  the  new  year. 

The  Board  of  Trade  at  the  present  time  is  in  negotiations 
with  two  large  concerns,  manufacturers  of  asbestos  products. 

Building  Active  in  Quebec 

During  the  year  there  has  not  been  any  important  new 
industrial  establishments  in  the  city.  No  additions  to  exist- 
ing industries  have  been  made.  Building  construction  has 
been  very  active  during  the  year,  the  principal  constructions 
being  schools,  churches,  business  blocks  and  a  large  quantity 
of  residences.  Quebec  is  one  of  the  two  cities  in  the  Do- 
minion with  a  population  of  over  100,000  showing  an  increase 
for  building  permits  for  the  first  nine  months  of  1921  over 
the  same  period  of  last  year,  Montreal  being  the  other. 

Some  of  the  industrial  establishments  were  not  very 
busy.  But  there  were  few  shut  down.  The  clothing  industry 
and  the  tanners  and  curriers  were  among  the  trades  to  suffer 
the  most  from  the  depression.  The  boot  and  shoe  industry 
is  gradually  getting  back  to  normal  again.  A  marked  im- 
provement has  been  noticeable  during  the  last  few  weeks. 
The  leather  industry  in  the  city  being  the  most  important 
one,  it  will  mean  much  to  the  citizens  to  see  it  get  back  to 
normal  again.  In  examining  the  last  detailed  figures  pub- 
lishe/i,  this  being  the  industrial  census  of  1918,  we  find  that 
tKis  industry  represented  over  30  per  cent,  of  the  total  pro- 
duction in  the  city,  about  $13,000,000  from  a  total  of  $38,- 
000,000. 

There  have  been  no  strikes  to  affect  any  of  the  indus- 
tries. The  police  officers  and  firemen  declared  a  strike  at 
the  end  of  June  last,  but  were  forced  to  accept  an  uncon- 
ditional surrender,  and  the  city  refusing  to  recognize  their 
unions,  they  were  hired  back  individually  and  on  their  merit. 

The  building  laborer's  union  tried  a  strike  in  July  last, 

their  demand  could  not  be  granted  by  the  contractors,  plenty 

of  men  being  ready  to  work  for  the  wages  offered,  so  it  did 

not  affect  any  contracts. — Industrial  Commissioner,  Quebec. 

Industrial  Development  at  St.  John 

Industrial  development  and  port  development  have  not 
been  carried  along  on  very  broad  lines  in  the  St.  John  dis- 
trict the  past  year.  On  both  sides  a  waiting  game  has  been 
played,  but  with  the  industrial  advantages  that  St.  John 
offers,  with  the  possibilities  of  cheaper  power  that  are  behind 
the  new  hydro-electric  scheme  which  the  Provincial  Govern- 
ment is  working  out,  and  with  the  potentialities  of  the  port 
as  the  chief  winter  resort  of  Canada,  better  things  are  looked 
for  in  the  early  days  to  come. 

Recently  rapid  progress  has  been  made  in  the  direction 
of  an  oil  bunkering  plant  for  the  port.    A  tank  with  a  capac- 


January   «,   11)22. 


THE      M  O  N  »T  A  R  Y      TIMES 


215 


ity  of  55,000  barrels  has  been  erected  at  East  St.  John,  on 
Courtenay  Bay,  by  Mr.  Allan  G.  McAvity,  and  it  in  expected 
that  a  wharf  will  be  constructed  and  piping  laid  in  time  for 
the  use  of  ocean  shipping  the  coming  winter. 

Just  alongside  the  oil  bunkering  plant  the  St.  John  Dry 
Dock  and  Shipbuilding  Co.,  Ltd.,  are  working  on  the  new 
dry  dock,  which  will  be  1,150  feet  in  length.  Concrete  is 
now  being  laid  in  the  dock  area. 

'  Within  the  year  the  government  has  established  a  wire- 
less direction-finding  station  at  the  entrance  of  the  port. 
This  has  been  found  most  useful  by  shipping  entering  the 
bay. 

A  new  immigration  building  of  convenient  type  has  been 
erected  on  the  west  side  of  the  harbor,  through  the  co-opera- 
tion of  the  Innnigration  Department  and  the  Canadian  Pacilic 
Railway. 

The  Canadian  Pacific  llailway  has  just  copmleted  the 
construction  of  a  steel  railway  bridge  across  the  Iteversing 
Falls.  It  is  of  a  very  substantial  character  and  will  enable 
the  railway  to  handle  passengers  and  freight  much  more 
lapidiy  and  conveniently  than  in  the  past. 

The  Public  Works  Depaitment  has  made  a  start  in 
providing  live  stock  shipping  facilities  on  the  western  side 
of  the  harbor.  One  of  the  government  sheds  at  Pier  15  is 
being  used  for  this  purpose.  It  will  have  a  holding  capacity 
of  about  GOO  head  of  cattle.  Some  shipments  for  the  month 
of  December  through  this  port  have  already  been  booked. 
The  providing  of  these  facilities  by  the  government  will  lead 
to  the  C.P.K.  furnishing  cattle  sheds  at  Brownville,  or  some 
other  nearby  point,  so  as  to  care  for  any  cattle  that  may  be 
passing  through  this  way  over  their  line.  The  new  west 
side  facilities  will  be  open  to  both  the  C.P.U.  and  the  Cana- 
■  lian  National  liailways. 

With  reference  to  manufacturing  industries,  the  Corn- 
wall and  York  Cotton  Mills  Company  have  just  completed 
an  extensive  power  station  alongside  their  York  mill  on  the 
Courtenay  Bay  front. 

T.  McAvity  &  Sons,  Ltd.,  are  preparing  for  the  carrying 
on  of  mechanical  manufacturing  at  their  new  plant  on 
Rothesay  avenue. 

Clarke  Bros.,  who  carry  on  pulp  manufacturing  at  Bear 
River,  N.S.,  have  recently  established  a  fibre  container  plant 
at  Glen  Falls,  alongside  the  city. 

The  Stephen  Construction  Company  have  purchased  the 
Lee  brick-yard  on  the  Red  Head  Road,  which  has  been  idle 
for  several  years  past,  and  intend  resuming  the  manufac- 
ture of  bricks  on  a  large  scale. 

Spice  manufacturing  in  St.  John  has  taken  quite  a  leap 
the  past  year  through  the  G.  E.  Barbour  Company,  Ltd., 
taking  over  the  Ready  brewery  buildings  on  Peel  street, 
and  through  the  formation  of  the  Canada  Spice  and  Specialty 
Mills,  Ltd.,  which  firm  is  functioning  in  the  former  Dear- 
born spice  building. 

The  Pacific  Dairies,  Ltd.,  and  the  Purity  Ice  Cream 
Co.,  Ltd.,  are  carrying  on  the  manufacture  of  ice  cream  on 
a  large  scale  in  the  city. 

The  Campbell  and  Fowler  edge  tool  and  auto  spring 
manufacturing  plants  have  merged  together  recently  and 
are  now  carrying  on  as  Campbell  &  Fowler,  Ltd.,  on  City 
Road. — R.  E.  Armstrong,  secretary  St.  John  Board  of  Trade. 

Better  Outlook  in  Truro 

Truro  has  nothing  of  importance  to  report,  for  no  new 
industries  opened  in  the  town  or  vicinity  this  year. 

However,  all  of  those  previously  in  operation  are  still 
carrying  on,  and  the  outlook  is  better  than  a  year  ago. — 
Secretary  Board  of  Trade,  Truro,  N.S. 

Frederictou  Had  Quiet  Year 

Fredericton,  the  capital  of  the  Province  of  New  Bruns- 
wick, experienced  no  marked  industrial  development  during 
the  past  year. 

The  industrial  position  of  the  city  as  a  whole,  however, 
was  marked  by  stability.  No  new  manufacturing  plants 
located  there,  but  none  moved  away,  and  there  were  no  shut- 
downs.— R.  H.  Simonds,  secretary  Board  of  Trade,  Fred- 
ericton. 


Halifax  Coiifltlfnt  of  Future 

Notwithstanding  the  falling  off  of  trade  tbrouKh  Halifax 
Port  during  1921  compared  with  1920.  It  is  found  when 
comparing  with  the  normal  year  of  1913,  as  a  portion  of 
1914  was  interfered  with  by  the  opening  of  the  war,  the 
progress  over  that  year  compareg  favourably  with  the  pro- 
gress of  normal  years.  Comparing  the  figures,  they  are 
greatly  in  excess,  but  of  course  are  made  up  of  values  and 
not  of  bulk. 

The  total  trade  through  the  port  during  tlie  year  1913 
— Imports  and  exports,  amounted  to  (30,000,000,  and  not 
even  the  most  optimistic  predicted  that  In  1918  these  fig- 
ures would  reach  $156,500,000,  but  the  Increase  was  made 
up  largely  of  munitions  of  war,  and  when  the  war  stopped. 
It  was  felt  that  our  figures  would  not  be  much  more  than 
in  normal  years.  In  1920,  the  exports  totalled  $54,500,000 
while  this  year  to  the  close  of  November,  they  totalled  $32.- 
653,139  and  will  probably  reach  $35,000,000  at  the  close  of 
the  year.  To  this  must  be  added  the  Imports,  which,  for 
the  11  months  of  the  year  valued  $15,104,159.  making  a 
total  of  $50,000,000,  but  as  stated  before,  the  Increase  is 
largely  made  up  of  values. 

Customs  receipts  for  the  11  months  of  this  year  total 
$2,146,455  and  will  probably  reach  $2,400,000  at  the  close 
of  the  year,  or  a  decrease  when  compared  with  1920  of  over 
$1,000,000.  While  values  have  gone  up  in  this  respect.  Im- 
ports in  quantity  have  fallen  off. 

The  Port  tonnage  keeps  up  well — that  is.  In  gross  ship- 
ping tonnage.  In  1913  our  total  tonnage,  inwards  and  out- 
wards amounted  to  3,901,094;  in  1918,  it  totalled  17,000,- 
000,  but  dropped  to  practically  5,000.000  In  1920;  for  the 
11  months  of  1921,  It  figured  4,442,749  and  will  probably 
reach  4,500.000  when  the  month  of  December  is  Included. 
Comparing  it  with  1913.  this  Is  a  considerable  Increase,  but 
it  is  owing  to  the  fact  of  the  establishment  of  the  oil  works 
since  that  date  and  the  large  number  of  ships  deliTerlng 
and  calling  here  for  fuel  oil. 

Building  permits  for  the  10  months  ending  November 
30th  totalled  $2,161,198  and  will  probably  amount  to  $2,- 
190,000  for  the  year — considerable  falling  off  when  compar- 
ed with  last  year  when  they  totalled  $3,420,329,  but  are 
considerably  in  excess  of  the  normal  year  of  1913  when  they 
amounted  to  $879,320  only.  During  the  year,  several  fine 
business  buildings  have  been  erected.  Among  them,  those 
in  connection  with  Dalhousie  University,  two  telephone  ex- 
changes, a  modern  retail  dry-goods  store.  High  School,  Bank 
of  Montreal,  and  practically  300  new  dwellings — at  least  one 
of  them  costing  upwards  of  $40,000. 

Bank  clearings  have  fallen  off  in  keeping  with  other  fig- 
ures. For  the  11  months  closing  November  30th.  they  to- 
talled $168,364,210,  and  will  probably  reach  $180,000,000 
for  the  year — compared  with  $255,678,397  for  the  year 
1920,  but  an  Increase  when  compared  with  1913  when  they 
totalled   $105,347,626. 

Business  conditions,  both  wholesale  and  retail,  can  hard- 
ly be  reported  as  having  been  entirely  satisfactory — prices 
have  been  gradually  falling  when  compared  with  a  year  ago, 
and  some  firms  were  caught  with  fairly  heavy  stocks.  While 
the  number  of  failures  have  been  in  excess  of  previous  years, 
they  have  been  small  and  have  Included  a  number  of  stores 
recently  starting  business  with  an  Inadequate  capital  and 
could  not  stand  the  strain.  At  the  present  time,  there  are 
about  800  unemployed  registered,  while  the  population  of 
the  city  stands  at  63.000  so  that  compared  with  other  cities. 
we  are  probably  somewhat  better  off  in  this  respect. 

The  feeling  among  the  merchants  regarding  the  coming 
year  Is  that  of  optimism  —  it  generally  being  considered 
quiet  times  during  readjustment  have  enabled  many  busi- 
ness firms  to  adjust  matters  in  keeping,  and  confidence  is 
expressed  In  a  more  favourable  year's  business  durlns  1922. 
SecreUry,  Halifax  Board  of  Trade. 


MASSEY  HARRIS  CLAIMS. 


Thomas  Brsdshaw,  mana^r  of  the  Massey  Harris 
Company,  visited  Germany  last  June  and  secored  •  aettle- 
tnent  of  the  company's  claim  of  11,500.000  agnkinst  Gemans. 


216 


THE      MONETARY      TIMES 


Volume  68. 


Industrial  Expansion  in  Western  Canada 

Notwithstanding  the  Depression  Last  Year,  a  Considerable  Amount  of  Pro- 
gress  in  Manufactures  Is  Reported,  Psirticularly  in  Manitoba — Progress  in 
Alberta  Oil  Fields — Possibility  of  Establishment  of  Pulp  Industry  in  the  West 


THE  basic  Industry  of  the  Prairie  Provinces  has 
always  been  agriculture,  is  now,  and  no  doubt 
always  will  be.  Fertility  of  soil  and  dryness  of  climate 
have  in  fact  made  the  prairies  one  of  the  most  productive 
parts  of  the  continent  for  field  crops.  Wheat  of  fine 
quality  is  the  particular  product.  But  notwithstanding, 
Western  Canada  is  growing  in  importance  in  manufac- 
tures. Particular  attention  is  drawn  to  the  expansion 
which  has  taken  place  during  the  past  year  in  Manitoba, 
with  the  establishment  of  many  new  industries.  Of 
course  the  development  is  taking  place  in  the  larger 
cities,  of  which  Winnipeg  is  the  centre. 

There  is  a  possibility  of  the  pulp  and  paper  industry 
commencing  in  the  Provinces  of  Manitoba  and  Saskat 
chewan,  although  nothing  definite  has  been  arranged, 
with  the  exception  of  the  sale  of  many  miles  of  timber 
limits  in  Manitoba  by  the  Dominion  Government  last 
summer.  Manitoba  is  blessed  with  an  abundant  supply 
of  water  power,  while  Saskatchewan  has  extensive 
deposits  of  sodium  sulphite,  which  offer  good  possibilities 
for   paper   making. 

Special  progress  was  made  in  the  oil  production  indus- 
try in  Alberta  last  year,  with  many  new  districts  opened. 
The  coal  mining  industry  also  continues  to  offer  good 
opportunities.  In  all  provinces  of  the  West  there  are 
large  mining  areas,  which  still  await  development. 

British  Columbia  did  not  enjoy  a  v«ry  good  year.  Two 
of  its  most  important  industries,  lumber  and  fishing, 
experienced,  poor  results,  which,  of  course,  meant  a  good 
deal  to  the  lumber  and  pulp  mills,  and  the  canneries. 
However,  a  considerable  number  of  new  manufacturering 
companies  were  established  last  year,  although  most  of 
these  were  small,  and  not  very  significant. 

Wlnnipeg'.s  Expansion  in  1921 

Eighty-six  new  industries  established  in  Winnipeg 
during  1921.  In  the  list  are  included  garages,  printing 
shops,  knitting  factories,  furriers,  hotel  supplies,  candy 
factories,  woodworking  plants,  cabinet  factories,  imple- 
ment factories,  electric  appliance  factories,  lamp  manu- 
facturing, saw  mill,  broom  factories,  builders'  supplies, 
picture  framing,  ice  cream  cone  factories,  etc,  etc. 

In  addition  to  this  list,  172  businesses  have  been 
established.  The  list  includes  civil  engineers,  coal  com- 
panies, meat  markets,  candy  stores,  restaurants,  livery 
stables,  dentists,  grocers,  grain  dealers,  stationers,  and 
numerous  retail  establishments. 

Two  Important  undertakings  which  are  linked  with 
Winipeg's  industrial  expansion  are  extension  of  the  city 
of  Winnipeg  power  plant  on  the  Winnipeg  River,  giving 
an  additional  capacity  of  30,000  h.p.  and  increasing  the 
present  capacity  to  60,000  h.p.  The  Manitoba  Power 
Co.  has  commenced  operations  on  a  power  plant  on  the 
Winnipeg  River  which  will  have  a  capacity  of  160,000 
h.p.,   and  will   cost  approximately    $10,000,000. 

Among  the  largest  contracts  of  the  year  in  downtown 
Winnipeg  are:  additions  to  the  Olympla  Hotel,  $200,000; 
Manitoba  Medical  College,  $175,000;  Aberdeen  school, 
$190,000;  Union  Bank  of  Canada  addition,  $120,000  ; 
warehouse,  $100,000. — Secretary  Winnipeg  Board  of 
Trade. 

Conservatism  Regina's  Keynote 

Conservatism  has  been  the  keynote  in  respect  of 
industrial  and  commercial  expansion  in  the  city  of  Reglna 
during   the   past   year. 

There  has  been  satisfactory  progress  in  mercantile 
circles,  as  evidenced  by  the  establishment  of  distribution 
branches  by  several  well  known   houses,  and  by  material 


extensions  in  the  plants  of  concerns  already  located  at  this 
point. 

The  outstanding  feature  of  this  phase  of  the  city's 
development  has  been  the  conversion  by  Imperial  Oil, 
Ltd.,  of  their  refining  plant  into  a  "continuous"  system, 
at  a  cost  of  approximately  half  a  million. 

Construction  work  has  been  quite  brisk  throughout 
the  year,  mainly  along  residential  lines,  no  less  than  four 
hundred  new  houses  having  been  built.  These,  with 
several  new  commercial  enterprises,  bring  the  total  of 
building  permits  within  measurable  distance  of  those  of 
the  previous  year,  when  a  number  of  pretentious  struc- 
tures helped  to  swell  the  total. — Secretary-Manager 
Regina  Board  of  Trade. 

Extensive  Building  in  Brandon 

This  has  been  Brandon's  largest  year  in  the  matter  of 
building  permits  issued  for  construction,  although  the 
construction  work  has  not  been  confined  entirely  to  indus- 
trial concerns.  During  the  year  the  Imperial  Oil  Com- 
pany built  a  new  plant  here,  costing  in  the  neighborhood 
ot  $350,000,  and  is  now  serving  one  of  the  largest  of  the 
company's  districts  in  the  west.  The  Massey-Harris  Co. 
also  recognized  the  city's  ideal  situation  as  a  distributing 
centre,  and  they  have  taken  over  the  Gordon  Mackay 
building  here,  purchasing  the  big  building  at  an  approxi- 
mate cost  of  $130,000. 

A  new  iron  foundry  works  will  probably  start  opera- 
tions in  the  new  year.  This  company  will  take  over  the 
premises  occupied  by  the  Manitoba  Engines  Ltd.  The 
L.  R.  Steel  company  purchased  a  site  for  a  big  depart- 
mental store  here,  but  have  not  yet  opened  up  business. 

Various  extensions  have  been  made  to  local  industrial 
concerns,  and  the  year,  from  a  business  standpoint,  has 
been  one  of  the  best.  Brandon  is  the  centre  of  a  large 
agriculture  district,  and  the  Provincial  Government  came 
to  the  aid  of  the  Winter  Fair  Association  this  summer, 
with  the  result  that  a  new  winter  fair  arean,  costing 
$150,000  has  been  erected.  A  new  box  factory,  owned  by 
John  Hanbury,  is  to  start  business  soon.  Building  per- 
mits tor  the  year  totalled  nearly  $1,000,000. — Secretary 
Brandon    Board    of   Trade. 

Satisfactory  Year  For  Moose  Jaw 

The  year  1921,  taking  all  things  into  consideration,  has 
been  satisfactory.  Building  operations,  wtiilst  not  90 
great  in  volume  as  in  1920,  have  been  very  good.  Sixty 
private  residences  have  been  erected,  practically  all  for 
private  citizens  for  their  own  occupation.  Other  construc- 
tion activity  included  three  additional  public  school 
buildings.  The  city  has  carried  out  an  extensive  program 
of  permanent  road  construction  and  made  additions  to 
the  light  and  power  plant. 

A  new  industry  for  Moose  Jaw  was  secured  through  the 
activity  of  the  Board  of  Trade:  a  branch  factory  of  the 
Imperial    Optical    Company.    Ltd.,    of   Toronto. 

While  the  deflation  of  prices  and  the  consequent 
adjustment  of  stocks  has  made  the  year  a  difficult  one, 
the  basic  soundness  of  the  city  and  district  is  reflected 
in  the  fact  that  there  have  been  no  noteworthy  assign- 
ments and  no  businesses  of  any  size  have  ceased  operations- 
The  temporary  closing  of  the  Gordon,  Ironside  &  Fares 
packing  plant  was  due  to  the  great  shortage  of  hogs; 
while  the  hog  situation  is  improving,  it  is  as  yet  impos- 
sible to  forecast  when  the  supply  available  will  be  such 
as  to  enable  the  plant  to  resume  operations. — Secretary 
Moose  Jaw  Board   of  Trade. 

No  Great  Progress  in  Victoria 
In  common  with  the  world  conditions  the  city  of  Vic- 


January  6,   1922. 


tHe     monetary     times 


217 


1/  thill y-flvv  he  lenn  back  again  at  a  job;  a  cog 
in  a  big  machine 


At  thirty-three  he  was  the  head  of  a  promininrj 
little  business  of  his  oum 


Will  you  be 


one  of  the  38.2°^^ 


FIVE  years  ago  a  man  of  thirty  look 
his  savings,  and  the  savings  of  some 
of  his  friends,  and  embarked  in  busi- 
ness for  himself.  He  was  honest,  Indus- 
trious and  attractive;  there  seemed  to  be 
every  reason  why  he  should  succeed. 

Today,  at  thirty-five,  he  is  filling  a  de- 
partmental position  in  a  big  concern — a 
position  no  better  than  the  one  he  left 
five  years  ago. 

What  happened  to  his  business  that 
promised  so  much?  Fraud?  No.  Lack 
of  capital?  Not  primarily.  Neglect? 
Not  at  all. 

The  trouble  was  with  the  t'-alning  of 
the  man.  He  was  an  expert  salesman, 
but  he  kneto  absolutely  nothing  of  the 
other  phases  of  business. 

The  failures  the  Institute 

could  prevent 

He  could  sell  goods,  but  he  was  wholly 
Ignorant  of  factory  and  office  organiza- 
tion and  control.  Costs  and  accounting 
were  foreign  languages  to  him;  trans- 
portation, advertising,  corporation  fin- 
ance— he  made  mistakes  in  every  one  of 
them,  and  each  mistake  cost  him  money. 

He  belonged  to  the  38.2%  of  business 
failures  whom  Bradstreet  groups  under 
the  tragic  head:     "Incompetence." 

It  is  these  failures— and  those  due  from 
"inexperience"  and  lack  of  capital 
(which  Is  merely  anotlier  word  for  bad 
Judgment) — that  the  Alexander  Hamilton 
Institute  can  prevent. 

For  its  Modern  Business  Course  and 
Service  Is  designed  to  round  out  a  man; 
not  to  make  him  a  better  specialist  In  the 
single  department  he  already  knows  but 
to  give  him  a  working  knowledge  of  all 
other  departments. 

Canadian    Address,   C.P. 


Here  are  the  Reasons  why 
Men  Fail 

as  rriiortcd  by  Bradstreet 


Cause 

♦Incompetence 

38.2'^ 

♦Incxporiencfc 

.     .">.« 

*Ijiuk  of  Capital 

30.3 

*l'nwise  Credits 

1.3 

*Krnu<l 

7.0 

Sperulation 

.7 

Specific  conditions 

11.3 

Competition 

1.1 

NeRlect 

1.7 

Kxtravagaiice 

1.1 

Failures  of  others 

.1.7 

Total 


100.0% 


•Tlic^c  nil'  tlic  iici'ill<>>>  fiilliiro  lliiil  II 
ui'll  roiiiiiled  business  tniiiiinu  wiiiild 
prciciil. 

lack  of  iraininK  In  the  fundamentals 
wliicli  underlie  all  business  makes  men 
iucdinix'tciil  loaves  tliriu  ijrnoivuu  or  llie 
pdor  risks  fur  caiiUal:  hlliids  Ilieiii  lo  the 
orilln.Trv  safeiriiaids  of  rredlt  extensions; 
and  e-xposcs  them  to  all  the  frauds 
wlilrh     pi'cy     on     hiislm-ss     iifnoraiicc. 


That  is  why  so  large  a  proportion  of 
the  thousands  of  Institute  men  have 
stepped  from  mere  positions  Into  busi- 
nesses of  their  own,  and  have  achieved 
unusual  success. 

Will  you  work  all  your  life  in  a 

routine  job? 

You  may  never  have  thought  of  it  In  this 
way  but  you  are  paying  for  the  training 
of  the  Alexander  Institute  whether  you 
accept  It  or  not. 

If  you  do  accept  it,  trie  cost  Is  a  little 
investment  In  money  and  time.  But  who 
R.    nidg.,    Toronto;    Australian    Address,    42 


can  figure  what  the  cost  of  indecision  and 
delay  may  be? 

Suppose  tomorrow  an  opportunity 
comes  In  yujr  present  organization  for 
a  trained  and  self-confident  man  to  step 
up  into  the  class  of  executives?  Or  suv- 
pose  some  day  you,  with  your  savings 
and  experience,  start  a  business  of  your 
own. 

Most  men  look  forward  to  such  a  day — 
the  day  they  will  be  made  executives'  or 
go  Into  busine.ss  for  themselves.  It  Is 
the  beginning  of  real  Independence.  Will 
you  be  equipped  when  that  day  comes? 

"Forging   Ahead   in   BuamcM" 

The  Institute  has  helped  thousands  of 
men  to  shorten  their  path  to  independ- 
ence. It  makes  no  special  argument;  It 
asks  only  for  an  op|)ortunlty  to  lay  the 
full  facts  before  thoughtful  men  for  their 
consideration  and  decision.  The  facts  are 
gathered  into  a  book  of  120  pages  entitled 
"Forging  Ahead  In  Business." 

It  explains  the  Modern  Business  Course 
and  Service  In  full,  and  tells  just  what  it 
has  done  for  other  men  In  positions  simi- 
lar to  yours.  Any  thoughtful  man  may 
have  a  copy  by  mall  on  request,  and 
without  obligation.  For  your  convenience 
we  attach  a  cou|K>n  and  suggest  that  you 
fill  It  out  now. 

Alexander  Hamilton  Institute 

2I»»  .Astor  rincf       New  York  City 

Send  nie  "Forfrlng-  \bead  In  Btislnass" 
which  I  may  keep  wltbout  obliratlon. 

N.tll!.  


Print   here 


iiii-iiip- 

.\ddrc.-> 


Business 
Position 

Hunter  Street.    Svdnoi 


Copyright,  1922,  .Atexandtr  Hamilton  Insiitatr 


218 


THE       MONETARY       TIMES 


Volume  68. 


toria  and  vicinity  shows  no  great  advancement  during  the 
past  year.  It  is  gratifying,  however,  to  find  that  progress 
has  Ijeen  made.  The  fruit  and  agriculture  crops,  gen- 
erally,   were   above  average. 

The  commencement  of  the  construction  of  the  drydock 
at  Esquimault  and  the  completion  of  the  Hudson's  Bay 
Store,  commenced  before  the  war  and  recently  opened  for 
business,  encourage  the  outlook  for  future  prosperity. 
Building  operations  were  not  extensive  but  the  aggre- 
gate for  the  previous  months  of  this  year  is  $662,708, 
which  exceeds  the  total  of  last  year,  1920. 

The  following  are  some  of  the  industries  recently 
established  in  this  city:  B.  C.  Yacht  and  Boat  Builders; 
Canadian  Abrasive  Paper  Co.;  Canadian  Western  Wood- 
workers; P.E.  George  (gramaphones) ;  Henshall  Fish 
Pfoducts,  (Sooke,  B.C.);  Hiker  Manufacturing  Co.;  Vet- 
erans' Product  Co.; Victory  Attachable  Rubber  Soles  and 
Heels  Co.;  Wholesale  Pish  Co.;  Sidney  Roofing  and  Paper 
Co.    (recently   moved   in   from   Sidney). 

The  payrol";  of  Victoria  and  vicinity  is  approximately 
$.').000,000  per  annum,  and  there  has  not  been  much  change 
this  year. 

It  is  gratifying  to  record  the  feeling  prevailing  that 
the  worst  of  our  depression  Is  over  and  that  from,  now 
on  a  steady  advancement  to  normal  conditions  may  be 
expected. — Secretary    Victoria    Chamber    of    Commerce 

Edmonton's  Experience  Not  Bad 

Industrial  developments  in  Edmonton  during  1921  show 
a  small  addition  in  the  number  of  new  establishments  and 
a  small  expansion  in  a  number  of  the  old  ones.  New  indus- 
tries are  represented  by  the  Dominion  Furniture  Co.,  the 
Dominion  Carton  &  Printing  Co.  and  the  Edmonton  Silver 
Plating  Co.  These  useful  units  of  the  industrial  communitv 
have  begun  in  a  moderate  way  and  are  making  substantia! 
progress.  The  North  West  Biscuit  Co.  Ltd.  having  outgrown 
the  capacity  of  its  old  plant,  has  completed  and  moved  into 
a  splendid  new  factory  that  represents  an  investment  in 
building  and  equipment  of  $400,000.  The  new  Journal 
Building,  one  of  the  finest  in  Western  Canada,  built  by  the 
Edmonton  Journal  Publishing  Co.,  was  completed  in  March, 
at  a  cost  of  $240,000.  Two  new  public  buildings  have  been 
erected  this  year^  the  Royal  Alexandra  Hospital,  at  a  cost 
of  $287,000,  and' the  Medical  Building  of  the  University  of 
Alberta,  costing  $850,000.  But  the  most  gratifying  phase 
of  the  building  operations  in  Edmonton  this  year  has  been 
the  erection  of  moderately-priced  homes  by  actual  residents 
and  owners.  Over  200  houses  of  this  class,  at  an  average 
cost  of  $4,000  each,  have  been  built  in  the  city. 

The  out-put  of  industrial  plants  has  been  close  to  nor- 
mal, except  those  that  depend  upon  foreign  export  for  a 
large  output.  In  the  dairy,  garment  and  biscuit  industries 
the  turnover  has  been  ahead  of  that  of  a  year  ago  at  the 
same  date.  One  of  the  large  creameries  closed  its  doors 
during  the  year,  not^  however,  for  want  of  customers  for  the 
consumption  of  milk  and  its  products  is  increasing.  A  num- 
ber of  small  bakeries  amalgamated  under  a  strong  corpor- 
ate management. 

The  slump  in  the  live  stock  market  has  reduced  the  out- 
put of  the  packing  houses,  and  there  will  be  a  falling  off  in 
the  production  of  flour  and  lumber.  Coal,  however,  is  an- 
ticipated to  be  close  to  last  year's  production. 

Bank  clearings  show  a  shrinkage  of  over  $20,000,000 
compared  with  the  eleven  months  of  1920.  The  percentage 
of  decrease  compares  most  favorably  with  other  financial 
centres  in  Western  Canada. 

Although  prices  of  commodities  are  lower  than  a  year 
ago,  retailers  report  larger  sales  than  last  year  in  most  lines. 
This  is  due  in  part  at  least  to  the  fact  that  reduced  prices 
have  tempted  the  buying  public  who  have  been  holding  back 
since  the  sharp  upward  curve  of  commodity  prices  after  the 
close  of  the  war.  It  represents,  however,  not  greater  buy- 
ing power,  but  a  greater  need  to  rehabilitate  the  family 
wardrobe  and  renew  the  household  equipment. 

Calgary  Pretty  Well  Employed 

So  far  as  general  industrial  conditions  are  concerned,  the 
factories  in  Calgary  have     been     pretty     well     employed 


throughout  the  year,  although  during  the  past  few  months 
trade  has  not  been  as  good  as  in  the  earlier  part  of  the  year. 
The  different  plants  have  been  able  to  keep  going  however, 
although  it  has  been  necessary  to  reduce  the  number  of  men 
employed. 

The  exceptionally  dry  summer,  particularly  in  the 
southern  part  of  the  province,  resulted  in  a  comparative- 
ly light  crop  and  this  with  the  low  prices  now  prevailing  on 
all  kinds  of  grain,  has  of  course,  curtailed  the  purchasing 
power  of  the  farming  community.  On  the  other  hand  it 
has  compelled  attention  to  the  importance  of  irrigation  in 
certain  districts  and  considerable  progress  has  been  made  in 
this  matter.  The  Lethbridge  northern  irrigation  scheme  is 
now  well  under  way  with  every  prospect  that  it  will  be  com- 
pleted and  in  operation  by  1923.  The  new  Alberta  Govern- 
ment are  not  only  giving  attention  to  irrigation,  but  recent- 
ly appointed  a  survey  board  of  well  qualified  men  to  study 
the  whole  question  of  the  conditions  in  Southern  Alberta, 
including  soil,  soil  drifting,  irrigation,  etc.,  and  if  possible 
find  a  solution  for  the  difficulties. 

Building  operations  for  this  year  compare  very  favor- 
ably with  a  year  ago.  The  building  permits  January  1st  to 
November  30th,  1921,  amounted  to  $2,122,800  as  against 
$2,602,700  for  the  same  period  in  1920.  The  chief  item.-! 
making  up  this  total  are  —  133  houses;  improvements  to 
Royal  Bank;  new  warehouse  for  Vernon  Fruit  Co.;  several 
new  coal  sheds;  new  warehouse  for  Lake  of  the  Woods 
Milling  Co.;  new  Show-rooms  and  garage  for  Maclin  Motor.? 
Ltd.;  a  number  of  retail  stores  and  several  schools  and 
churches.  While  the  total  figures  are  not  as  large  as  in 
1920,  it  does  not  indicate  that  the  volume  of  business  was 
not  as  large,  as  of  course,  the  prices  of  materials  and  to  some 
extent,  the  wages,  were  lower  this  year. 

Efforts  are  being  made  to  increase  the  activity  in  the 
building  trade  and  a  convention  will  be  held  in  Calgary  dur- 
ing the  first  week  in  March  at  which  representatives  from 
all  over  Western  Canada  will  be  present.  Secretary,  Calgary 
Board  of  Trade. 

Extensive  Building  In  Saskatoon 

During  the  year  the  building  carried  out  in  Saskatoon 
has  been  quite  extensive,  the  permits  calling  for  an  expend- 
iture of  $767,756  up  to  the  first  of  December,  most  of  which 
work  has  been  completed.  Of  this  total  176  permits  were 
taken  out  for  dwellings  at  a  cost  of  $437,475.  At  the  Uni- 
versity over  $100,000  has  been  expended  in  structural  ex- 
tensions. Although  not  included  in  this  years  building  per- 
mits, the  construction  of  the  new  Normal  School  has  been 
completed  at  a  cost  of  over  half  a  million  dollars.  This 
building,  which  is  one  of  the  finest  in  Canada,  will  be  oc- 
cupied early  in  January.  Much  work  has  been  done  by  the 
Canadian  National  Railway  in  connection  with  its  new  yard 
and  round  house;  and  the  replacing  of  the  trestle  bridge 
across  the  Saskatchewan  River  at  Saskatoon,  with  a  modern 
all  steel  structure. 

The  unfavorable  harvest  conditions,  together  with  the 
fact  that  the  value  of  agricultural  products  has  fallen  he- 
low  the  cost  of  production,  have  naturally  been  a  keen  dis- 
appointment to  the  farming  community;  yet,  the  farmers 
are  looking  to  that  readjustment  which  must  come  in  the 
near  future,  whereby  the  price  of  staple  products  and  the 
cost  of  production  will  be  brought  to  a  normal  level,  and 
firmly  believing  this,  they  will  carry  on — -trusting  for  a 
more  profitable  harvest  in  the  coming  year.  Commissioner, 
Saskatoon  Chamber  of  Commerce. 

New  Westniln.ster 

During  the  past  year  three  new  industries  were  added 
to  the  list  of  the  city  of  New  Westminster,  B.  C:  — 

The  Triangle  Chemical  Co.  Ltd.,  to  manufacture  chem- 
ical fertilizer,  etc.,  made  an  outlay  of  $150,000  on  its  plant. 

Dominion  Products,  Limited,  to  manufacture  starch,  po- 
tato flour,  etc. 

Union  Oil  Co.,  of  Canada,  main  distributing  plant  for 
the  Eraser  Valley,  made  an  outlay  of  $40,000. 

All  established  industries  remained  with  the  city,  al- 
though several  of  the  saw  mills  were  compelled  to  go  on 
short  time.     Harry  Stewardson,  City  Engineer. 


January   6,   1922. 


THE      MONETARY      TIMES 


219 


Canadian    Pacific   Railway    Has  Good   Year 

Result  of  Operations  Compares  Most  Favourably  with  Any  System  on 
American  Continent — Decreased  Traffic  but  Increased  Net  Earnings — 
New  Financing  Completed  —  Additions  to   Atlantic  and  Pacific   Fleets 

the     decreased 


IN  ap:te  of 
volume  of 
the  past  year, 
in  a  decline  in 
the  Canadian 
has  been  able  to 
operating    expenses 


traffic     during 

which    resulted 

gross  earnings, 

r'aciflc    Railway 

reduce     its 

in    propor- 


/ 


tlon.  flross  earnings  for  the 
first  ten  months  of  li)21  were 
$158,477,251,  a  decrease  of 
.tl.'!,7()0,78,3.  while  net  earnings 
were  $28,612,157,  an  actual  in- 
crease of  $1,754,135. 

This  is  a  distinct  improve- 
ment over  1920,  which  was  a 
particularly  unfavorable  year 
in  railway  operation. 

The  working  expenses  for 
1920,     including    all    taxes,  THK  LATE 

amounted  to  84.70  per  cent,  of  LORD  MOUNT  STEPHEN 
the  gross  earnings,  and  the  net  earnings  to  15. .SO  per  cent., 
as  compared  with  81.39  per  cent,  and  18.61  per  cent., 
respectively,  in  1919. 

The  gross  earnings  exceeded  those  of  1919  by  $39,712,289. 
and  the  net  earnings  by  $220,008.  This  large  addition  of 
$.19,492,281  in  working  expenses  was  due  to  the  enforced 
application  in  Canada  of  what  is  known  as  "The  Chicago 
Wage  Award,"  which  added  approximately  $12,000,000  to 
the  pay  rolls  for  the  year;  the  Increase  in  the  cost  of  fuel 
and  materials  and  the  charging  of  the  year's  Federal  taxes 
into  operating  expenses,  where  they  properly  belong.  The 
heavy  and  rapid  movement  of  freight  during  October  and 
November  and  the  firs!  half  of  December  under  the  tariffs 
prescribed  by  the  Railway  Commission  and  effective  on 
September  13th  enabled  the  company  to  absorb  these  ex- 
penses and  earn  its  usual  charges,  dividends  and  a  modest 
surplus.  While,  for  the  reasons  mentioned,  the  net  earn- 
ings were  not  commensurate  'with  the  volume  of  business 
transacted,  still  in  the  opinion  of  the  Directors  the  year's 
operations  were  regarded  as  satisfactory  and  compared 
most  favorably  with  those  of  any  system  on  the  American 
continent. 

The  sales  of  agricu'.tural  land  in  the  year  were  468,390 
acres  for  $9,598,706.95,  be- 
ing an  average  of  $20*48 
per  acre.  Included  in  this 
area  were  47,848  acres  of 
irrigated  land  which 
brought  $50.43  per  acre, 
so  that  the  average  price 
of  the  balance  was  $17.07 
per  acre. 

During  the  year.  1920 
the  Directors  disposed  of 
$8,000,000  of  four  per 
cent.  Consolidated  Deben- 
ture Stock  to  the  British 
Government  pursuant  to 
arrangements  previously 
made  at  the  time  of  the 
deposit  of  $40,000,000  of 
the  stock  with  the  British 
Treasury  in  1917.  The 
balance  of  the  stock 
deposited,  namely, 
$32,000,000,  was  returned 
to  the  company  and  made 
available  for  sale  or  othei 


\ 


^4 


K.  W.  liE.VTTY 
Pres.  C.  P.  R. 


VAXroi'VKU  STATION,  CANADIAN  rAilFU'  RAIliWA*. 


disposition  as  circumBtancea 
warrant. 

The  Directors  during  1920 
issued  $12,000,000  of  Equipment 
Trust  Notes  for  the  purpose  of 
acquiring  necessary  additions 
to  the  company's  rolling  stock. 
The  approval  of  the  share- 
'         .^  holders   was   obtained    in    1919 

and  1920  to  the  construction,  aa 
conditions  warranted,  of  branch 
line  mileage  in  Western  Can- 
ada amounting  in  the  aggre- 
gate to  822  miles,  and  during 
the  year  1920  100  miles  of  track 
of  this  authorized  mileage  was 
laid. 

While  extensive  new  con- 
struction was  not  considered 
under  the  present  conditions 
advisable,  the  Directors  were  of  the  opinion  that  a  moderate 
amount  of  construction  should  be  proceeded  with,  in  order 
that  the  full  value  of  the  lines  already  under  construction 
should  be  realized  and  that  the  settlers  In  the  districts  to 
be  served  should  obtain  the  railway  facilities  so  necessary 
to  their  prosperity.  The  branch  lines  heretofore  approved 
are  in  good  territory  and  well  located  to  become  revenue 
producing. 

.Approval  was  given  to  the  construction  of  an  extension 
of  the  Suffield  south-westerly  branch  from  Lomond,  a  dis- 
tance not  exceeding  thirty  miles,  and  for  the  Issuance  and 
sale  of  a  sufficient  amount  of  four  per  cent.  Consolidated 
Debenture  Stock  to  meet  the  expenditure. 

Four  steamers  for  Atlantic  and  Pecific  Service  previously 
contracted  for  are  now  being  built  for  the  company,  namely: 
"Empress  of  Canada,"  "Montrose,"  "Montcalm,"  "Mnnt- 
clare,"  and  the  "Koenig  Fritdrich  August"  has  been 
purchased. 

Another  ship  for    B.  C.    v ..^    is    under    construction. 

The  estimated  cost  of  these  six  ships  is  $331,175,000.  of 
which  $18,733,138  was  paid  up  to 'Slst  December.  1920. 
fhe  estimated  capital  requirements  on  the  account  for  the 
year  and  including  the  amount  re  quired  for  the  completion 

of  the  payments  on  the 
"Koenig  Frledrich  Aug- 
ust" purchased,  amount 
to  approximately  $12.- 
200.000.  Approval  was 
given  to  the  issuance  and 
sale  of  a  sufficient 
amount  of  Consolidated 
Debenture  Stock  to  meet 
the  expenditure  (or  these 
vessels.  During  the  year, 
the  S.S.  "Sardinian."  built 
in  1875.  was  sold. 

In  anticipation  of  con- 
firmation    the     Directors 
authorized  capital  appro- 
'  <ns.    in   addition   to 
approved     at     the 
annual    me«t- 
.;ating.   for  the 
:■■.:■    ii'20.  $3,246,318.  and. 
.iuij.ot  to  approval,  auth- 
orized    expenditures     on 
capiul      account     during 
1921    of   $4,316,236. 


220 


THE      MONETARY      TIMES 


Volume  68. 


BITILDING  PERMITS  AND  THE  BUIIiDING  TRADE 

Permits  Not  Much  Lower  In  Value,  But  Construction 

Work  Almost  Stagnant — The   Trend  Of 

Prices    And    Iiabour. 

AS  A  general  rule,  statistics  of  building  permits  may  be 
taken  as  being  a  reliable  index  of  business  conditions, 
for  they  reflect  the  confidence  in  the  prospect  for  active  busi- 
ness conditions,  since  executives  will  only  undertake  new  build- 
ing when  there  is  good  prospect  of  their  being  kept  busy. 
Thus,  when  there  is  distrust  of  contined  prosperity,  and  ex- 
pectancy of  lower  prices,  permits  should  show  a  falling  off  in 
proportion  to  depression  and  anticipation  of  such  conditions. 

Therefore,  in  looking  over  the  results  of  1921,  one  would 
expect  to  find  a  large  decrease  in  permits,  for  there  was  no 
mistaking  the  distrust  and  depression  which  was  prevalent 
then.  But  yet,  with  the  exception  of  two  or  three  months 
at  the  beginning  of  the  year,  increases  are  shown,  and  the 
total  result  for  the  year  is  almost  on  a  parallel  with  that  of 
1920,  and  quite  in  excess  of  1919,  when  confidence  was  the 
order  of  the  day,  and  prices  were  seeking  better  levels. 

Having  in  mind  that  fact  that  reports  from  contractors 
and  builders,  particularly  in  the  earlier  months  of  last  year 
were  characterized  by  such  phrases  as  "stag^nancy  in  the 
building  trade,"  we  are  confronted  with  a  paradox,  which  it 
seems  can  only  be  explained  in  one  way,  for  prices  of  ma- 
terials were  on  the  downward  trend,  and  it  could  not  be  said 
that  the  results  expressed  in  dollars  and  cents  reflects  wrongly 
the  volume  of  building,  but  rather  the  indications  are  of  a 
higher  volume  of  building. 

As  far  as  can  be  seen,  the  situation  is  just  this:  The 
figures  of  building  permits  do  not  represent  the  construction 
undertaken,  at  least  as  far  as  last  year's  results  are  con- 
cerned, for  there  were  many  postponements.  Just  as  an 
example.     In  July  last,  it  was  estimated  that  some  eight 


million  dollars  worth  of  projected  building  was  being  held  up 
in  Toronto  alone.  A  prominent  architect  of  the  city  stated 
about  two  months  ago  that  he  had  plans  for  about  three 
millions  of  building,  but  could  not  be  proceeded  with  until 
labor  and  other  business  uncertainties  had  become  settled. 
This  is  just  the  testimony  of  one  architect,  but  it  illustrates 
how  great  was  the  volume  which  was  held  in  abeyance.  Of 
course,  it  is  not  likely  that  all  postponements  were  where 
permits  had  been  received,  but  it  is  reasonable  to  suppose 
that  in  a  goodly  number  of  cases  where  permits  had  been 
received  the  plans  could  not  be  carried  out  at  once  because 
of  the  clouded  outlook. 

The  following  table  shows  that  month  to  month  trend 
of  building  permits  as  reportd  from  fifty-six  cities  in  the 
past  three  years: — 

1919  1920  1921 

January    $  1,166,816      $     3,956,247       $"2,372,512 

February    2,002,044  4,684,934  3,216,085 

March   3,329,050  8,258,410  6,610,703 

April    7,059,641  16,382,410         12,502,330 

May   7,776,282  12,160,379         13,233,543 

June    7,577,346  13,295,041         12,930,499 

July 9,274,125  13,025,560         10,137,547 

August    11,916,045  9,439,807  9,654,095 

September    13,303,832  8,921,374  9,988,147 

October   10,390,454  9,660,538  

November 7,733,263  5,289,321  

December    5,144,178  4,654,479  


$86,672,576       $109,728,500       $ 

Trend  of  Prices  and  Labor 

The  trend  of  prices  was  distinctly  downward  from  the 
fall  of  1920.  Perhaps  the  most  reliable  and  comprehensive 
index  of  this  fact  is  found  in  the  index  number  of  wholesale 
prices,  as  compiled  by  the  Department  of  Labor.    The  index 


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January  6,   1922.  THEM0NETARYTIME8  221 

^HIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIII^ 


I  LETHBRIDGE  | 

m    In  the  centre  of  the  largest  irrigated  farming  district  in  Canada     M 

=  Is  the  market  place  of  a  populous  and  prosperous  district.   The  annual   production   of  ^= 

^=  crops  in  the  irrigated  district  surrounding  Lethbridge  is  valued  at  $  1  00  per  acre  and  = 

=  upwards.      In    1920   from  irrigated  lands  the    production    of    grain    was    25,000,000  = 

=  bushels;   of  alfalfa  and   hay,    55,000  tons;    wool    clip    was    2,000,000    pounds,    with  = 

=  fair  crops  of  potatoes  and  vegetables.     Coal  production  was  over  1 ,000,000  tons  from  ^ 

^=  mines  close  to  the  city  and    1,500,000  tons  from  mines  in  the  adjacent  Crow's  Nest  ^ 

^=  Pass.      Bank   clearings   fairly  indicate  the   volume   of  business   done,   and   were  over  = 

m           ^         $46,000,000.  H 

^=  Sheep   raising  is  established   on  an  extensive  scale  around  the  city.      The  raising  of  ^= 

=  cattle  is  on  the  increase,  and  many  farmers  have  built  silos  to  carry  a  supply  of  juicy  = 

=  roughage  feeds  through   the  winters,   this  movement  being  greatly  stimulated  by  sue-  ^= 

=  cessful  sunflower  crops,  which  give  a  high  yield  of  leaf  and  stalk.  = 

=  Wholesale  and  retail  concerns  do  a  large  volume    of    business   throughout    the   year,  ^ 

=  both  with  the  towns  in  the  farming  districts,  and  with  the  coal  mining  centres  along  = 

^=  the  Crow's  Nest  Pass,   for  which  Lethbridge  is  the  distributing  centre,      iron  works  = 

^  and   machine   shops,    flour  mills,    macaroni  manufacturing  plant,  creameries,  automo-  = 

=  bile   salesrooms,   wholesale   boots  and   shoes  and   agricultural   implement   warehouses  ^ 

=  are  some  of  the  industries  established  here.  ^ 

^=  Railways,  besides  providing  facility  for  daily    business    among    the    many    busy    coal  ^ 

=  mines  in  the  Pass,  provide  an  alternative  route  for  tourists  desiring  to  see  this  inter  ^ 

=  esting   part   of   the   Rockies,    with   connections  making  quick  journey  to  the  States  of  = 

=  Washington,  Oregon  and  California,  or  northwards  through  the  Arrow  Lakes  or  west-  = 

=  wards  by  the  Kettle  Valley  line  to  Vancouver;   also  a   direct   line  to   Winnipeg  and  ^ 

=  the  East.  = 

^  The   immense  irrigation  project  in  Lethbridge  district,  a  great  deal  of  which  has  been  = 

=  completed,  will  when  finished  xjover  an  area   of  some  600,000  acres.      Tliere  is  no  = 

=  question  in  the  mind  of  anyone  now  as  to  the  beneficial  effect  the  completion  of  this  ^ 

=  project  will  have  upon  the  future  prosperity   of  the  City   of  Lethbridge;   but   if  any  ^ 

=  proof  is  wanted,   it  is  amply  supplied  by  the  conservatively  estimated  results  on  the  = 

=  irrigated   farms  around   Magrath,    Raymond,    Coaldale  and   Lethbridge,   and   the  en-  ^ 

^=  hanced  purchasing  power  of  the  owners.  = 

=  The  city  owns  and  operates  the  electric  light   plant,   the  water  filtration  plant,   a  coal  = 

=  mine  and  the  street  car  service;  also  an  industrial  building  suitable  for  the  establish-  = 

=  ment  of  small  industries  and  manufactures.  ^ 

^  Educational   facilities  are  of  a  high  order,  and  include  High  Schools,   Manual  Train-  ^ 

=  ing  School  and  public  schools,   both   Protestant  and  Roman  Catholic.  ^= 


llllliiilllllllllllllllillllllilillillilillllilllllilllli 


222 


THE       MONETARY       TIMES 


Volume  68. 


number  of  all  building  materials  at  November,  1920, 
was  368.5.  It  dropped  very  rapidly  from  there,  the  move- 
ment being  as  follows:  December,  356.5;  January,  347.1; 
February,  336.4;  March,  322.9;  April,  313.4;  May,  309.0; 
June,  305.3;  July,  301.7;  August,  285.7;  September,  280.6; 
October,  279.9.  To  increase  the  above  table  of  permits  it 
might  be  well  to  note  that  the  index  number  in  October,  1919, 
was  315.1. 

But  labor  presented  a  more  serious  problem.  Building 
trades  strongly  objected  to  reduction  in  wages,  which,  of 
course,  in  view  of  the  movement  of  general  conditions,  greatly 
aggravated  the  trade.  It  was  not  until  the  conference  of 
building  employers  and  employees  of  the  Dominion,  held 
at  Ottawa  in  May,  that  the  deadlock  was  broken.  Then 
the  agreement  was  that  there  should  be  reasonable  adjust- 
ment of  wages,  but  no  set  figure  was  given,  but  a  resolution 
to  the  effect  that  new  wage  levels  would  be  determined  by 
local  conditions,  was  passed.  It  was  not  long  after  that 
local  unions  realized  that  new  work  rested  upon  new  buildings 
and  new  buildings  upon  a  reasonable  adjustment  of  the  trade 
as  a  whole  to  conform  with  costs  generally. 

An  illustration  of  the  attitude  which  the  unions  finally 
assumed,  is  seen  in  the  conference  which  took  place  in  the 
middle  of  July  between  members  of  the  Canadian  Manu- 
facturers' Association,  the  Toronto  Building  Trades  Council, 
the  Builders'  Exchange,  the  brick  manufacturers  and  the 
building  contractors.  The  representatives  of  the  building 
trades  went  on  record  as  favoring  an  all-round  cut  of  10 
cents  an  hour  in  wages,  with  a  view  to  stimulating  business 
and  industry  in  the  province.  At  the  same  time  -it  was 
pointed  out  that  brick  manufacturers  and  other  suppliers 
should  make  reductions  in  the  cost  of  materials  in  order  that 
industry  might  be  boosted,  and  that  more  men  might  be 
given  employment. 

Small  Buildings 

While  large  construction  works  were  postponed,  it  is 
a  noticeable  fact  that  the  volume  of  building  by  the  small 
man,  who  builds  once  in  a  lifetime,  and  who  does  not  know 


•very  much  about  business,  was  larger.  Such  conditions  are 
reported  particularly  from  western  Canada.  From  what  can 
be  understood,  the  outstanding  feature  in  construction  activ- 
ity in  the  prairie  provinces,  was  the  large  percentage  of 
residential  buildings  which  were  erected. 

Regardless  of  the  fact  tha*  the  total  amount  of  the 
value  of  new  construction  was  considerably  less  than  in 
1920,  there  were  more  new  building  jobs  last  year,  and  the 
major  portion  of  material  supply  and  building  contract?;  re- 
sulted from  the  demands  of  the  small  dealer. 
A  Big  Building  Shortage 

In  closing  this  brief  article,  there  is  one  fact  worth 
mentioning.  That  this  country  is  short  of  buildings  and 
public  works  at  the  present  time.  Including  dwellings  and 
works  of  all  kinds,  to.  the  extent  of  $780,000,000,  was  the  de- 
cision of  the  Dominion  conference  in  Ottawa  last  May.  It 
was  shown  that  building  contracts  awarded  during  the  first 
three  months  of  1921  totalled  ?37,000,000,  as  compared  with 
§56,000,000  in  the  corresponding  period  of  1920 — a  decline  of 
35  per  cent.  The  figures  for  March,  1921,  were  even  more 
disquieting,  the  total  being  $10,000,000,  as  compared  with 
$21,000,000  in  March,  1920 — a  decrease  of  over  50  per  cent. 
On  May  1,  1921,  there  were  approximately  100,000  less  work- 
men employed  in  all  industries  than  there  were  employed  in 
January,  1921 — a  very  considerable  portion  being  men  usually 
employed  in  the  building  trade. 

In  this  regard  it  might  be  said  that  it  is  only  natural 
that  there  is  a  shortage  of  buildings.  During  the  four  years 
of  the  war  very  little  was  carried  on,  the  yearly  totals  of 
permits  in  1915,  1916,  1917  and  1918  being  considerably  be- 
low the  forty  million  mark.  1919  showed  a  great  improve- 
ment, while  1920  further  added  to  the  record,  but  the  pre- 
war results  are  still  out  of  reach.  For  instance,  in  1912, 
the  total  value  of  permits  was  more  than  $185,000,000,  while 
in  the  following  year  the  figure  was  nearly  $154,000,000.  It 
would  also  be  well  to  bear  in  mind  the  fact  that  the  index 
number  of  wholesale  prices  of  building  materials  was  only 
about  143,  while  labor  was  much  cheaper  than  it  is  even  now 
with  the  effected  reductions.  '    - 


Building  Construction  in  1921 


TORONTO          !■ 
nOWTRE^L     ■ 

■i4^l2,5(>7540 

YORKTWP       m 

w\mptc»      m 

WltlDSOR        ■ 

^■^■■1  #  4, 398,485 

Con3TRUCT\OM  \tA  THt 

HAMOOn      Pi 

l^BHH  #  3,€>(,0,(>95 

nwt\  c^^^^^ilAn  anES  'DUK\ttG 

quc&ec       ■ 

^mm  $  2,(>&fe,874 

THE  F\f\ST  n\rtE  MOmnS   OF 

VAMCOUVER    ll 

■■i  ^  2,5Z4>,4IS) 

THE  YEM^    1321. 

OTTAWA         p 

■■1  «  2,049,^55 

LOHbON         m 

■■  1  2,044M5 

RtQWA           ■ 

■■  #  l,S0l,47(> 

HAUFAX        ■ 

IH  %  l,697;4A9 

CALGARY       !■ 

■■  %  l,68i.400 

^  tlm'que  Chart  Dj/ste/n.?^. 

TANNING  INDUSTRY  IN  1»;21. 


The  report  of  the  tanning  section  of  the  Toronto  Board 
of  Trade  for  the  past  year  describes  the  decline  in  the 
prices  ot  leather  as  "unparalleled  in  the  history  of  the 
industry."  Tanners'  overhead  Is  stated  to  be  materially 
higher  than  it  normally  should  be,  and  leather  is  being 
offered  and  sold  at  less  than  replacement  basis.  It  is  felt 
that  prices  of  leather  will  have  to  he  advanced  in  the  near 
future,  in  tact,  some  lines  have  advanced  during  the  past 
month.  Summing  up,  the  report  states  that  the  funda- 
mental position  of  the  leather  industry  is  on  a  much 
sounder  basis  than  a  year  ago,  and  the  outlook  is  favor- 
able. 

The   Tanners'    Section   appointed    the    following    as    of- 


ficers for  the  ensuing  year:  Chairman,  K.  D.  Marlatt; 
P:rst  Vice-Chairm  u,  C.  W.  Conway;  Second  Vice-Chair- 
man,  L.  O.  Brs  thaupt;  Secretary-Treasurer,  F.  G.  Morley. 
Executive — A.  O.  Beardmore,  A.  0.  T.  Beardmore.  J.  G. 
Breithaupt,  G.  B.  Clarke,  Hon.  E.  J.  Davis.  W.  J.  Heaven, 
H.  B.  Johnston.  Theo.  King,  C.  cr  Marlatt,  W.  G.  Parsons. 
Charles  Robson,  C.  O.  Shaw,  John  Sinclair,  C.  W.  Tobey, 
S.  R.  Wickett.  Legislation  Committee — A.  O.  Beardmore, 
A.   O.  T.   Beardmore,   L.  J.   Breithaupt.  G.   B.  Clarke,   Hon. 

E.  J.  Davis,  N.  D.  Clarke,  W.  J.  Heaven,  H.  B.  Johnston, 
C.  G.  Marlatt,  W.  G.  Parsons,  Charles  Robson,  C.  W.  Tobey, 
S.    R.    Wickett.      Transportation    Committee — S.    P.    Beale, 

F.  C.  Beal,  A.  O.  Beardmore,  H.  L.  Daville,  W.  J.  Heaven, 
Theo.  King,  James  McMillan,  W.  A.  Moore.  John  Sinclair, 
S.  R.  Wickett. 


January  6,  1922. 


THE      MONETARY      TIMES 


223 


LARGE  AND 

MODERN  GAS 

WORKS 

The  Winnipeg  Electric 
Railway  Co.  supplies  gas 
to  thousands  of  consumers 
in  Winnipeg  and  district. 
The  plant  is  completely 
modern  and  has  an  out- 
put of  500.000,000  cubic 
feet  per  annum. 


AUXILIARY 
STEAM    PLANT 

In  addition  to  the  Pinawa 
power  plant  shown  above, 
the  Winnipeg  Electric 
Railway  Company  also 
has  an  auxiliary  steam 
plant  at  Mill  St.,  Winni- 
peg, capable  of  develop- 
ing 12,0OO  h.p.  and  thus 
ensuring  customers  of  a 
continuous  service. 


Kleciric  Hallway   (;naiiihei> 


The    Largest    Manufacturing    Establishments  In  Greater  Winnipeg  Are  Power, 
Light   and   Gas   Customers   of   the   Winnipeg     Electric     Railway     Company. 


Wiiinlpptf    Electric    Hallway    Company's    llytlro-Electrlc    plant  :ii    i  inawa    un    tlii?    Winnipeg    niver— Capacity    or    39.000    h.p 

POWER,  LIGHT  AND  GAS 

For  Industrial  and  Commercial  Purposes  in 

GREATER  WINNIPEG 


Source  of  addlllonal  power  for  Ihc  Wlnnlpeit  KleciMc  Hallway  Co,  —The    Oreat    Falls    development    on    the    Winniiieir    River. 
iiJ8,(H)i)  h.p.  capacity,  now  muler  construction  by  the  Manitoba  Power,  Co.  Ltinlleil 

WINNIPEG    ELECTRIC    RAILWAY    Company 


Sir  Augustus  Nanton,  President 


A.  W.  McLimont,  Vice-President. 


224 


THE      MONETARY      TIMES 


Volume  68. 


THE   IMPORTANCE   OP  IRRIGATION   WORK 

Benefits     Achieved     In     Alberta     Are     Encouragement     to 
Further   Expenditures 

A.  S.  DAWSON,  M.E.I.C. 

Chief  Engineer,   Department  Natural  Resources,   Canadian 
Pacific  Railway  Company,  Calgary 

UP  TO  the  end  of  1920  there  had  been  expended  on  the 
construction  of  irrigation  works  in  Southern  Alberta 
about  $20,000,000,  to  serve  about  850,000  acres  of  irrigable 
land. 

This  phase  of  development  was  practically  all  handled 
by  large  companies — pre-eminently  the  Canadian  Pacific 
Railway  Company,  who  held  large  blocks  of  vacant  land, 
constructed  the  works  to  serve  them  with  water,  and  then 
sold  to  new  settlers,  with  a  perpetual  contract  for  a  supply 
of  water  to  the  lands  at  a  fixed  annual  charge.  This  form 
of  enterprise  has  developed  all  the  large  projects  constructed 
up  to  date.  The  conditions  gradually  changed,  because  the 
large  areas  that  still  awaited  development  were  practically 
all  settled,  and  plans  were  formulated  to  develop  these  areas 
by  co-operative  effort  on  the  part  of  the  land  owners  them- 
selves. 

Federal  Government's  Work 

In  Canada,  the  Federal  Government  controls  all  the 
water,  conducts  the  hydrometric  work,  and  makes  all  pre- 
liminary surveys  and  investigations  in  connection  with  irri- 
gation development.  No  works  can  be  undertaken  without 
government  sanction,  based  on  thorough  engineering  investi- 
gations which  have  proven  the  feasibility  and  economic  sound- 
ness of  all  schemes  of  any  magnitude. 

These  surveys  to  date  show  that  close  to  a  million  addi- 
tional acres  in  Southern  Alberta  can  be  served  with  water 
within  reasonable  cost  limits;  and  some  of  this  area  will 
probably  be  served  as  a  result  of  the  recent  settlement  of 
certain  long  outstanding  matters  between  Canada  and  the 
United  States,  and  within  the  scope  of  the  International 
Waterways  Commission.  Preliminary  surveys  also  indicate 
that  additional  areas  of  about  3  million  acres  in  Alberta, 
and  4%  million  acres  in  the  Province  of  Saskatchewan  could 
also  be  profitably  irrigated. 

Value  Demonstrated 

During  the  past  dry  cycle  of  5  years,  all  doubts  as  to 
the  benefits  of  farming  large  portions  of  Southern  Alberta 
under  irrigation  methods  have  entirely  disappeared,  and  now 
everyone  is  an  enthusiast  of  the  idea  of  bringing  every 
possible  acre  under  the  ditch  system. 

But  how  were  the  construction  charges  to  be  met?  The 
settlers  were  not  financially  able  to,  as  a  result  of  several 
short  crops;  and  there  was  no  incentive  for  corporate  in- 
terests to  provide  the  necessary  capital.  The  Provincial 
Legislature  therefore  decided — or  rather  were  forced — ^to 
provide  the  necessary  machinery,  whereby  these  systems 
can  be  built  by  means  of  the  enactment  of  what  is  known 
as  the  "Irrigation  District  Act."  This  act  provides  for 
the  formation  of  irrigation  districts,  with  power  to  raise 
the  necessary  funds  to  construct  the  works  by  bond  issues, 
the  security  for  which  is  the  land  within  the  district. 

Among  the  outstanding  features  of  this  act  are  the 
appointment  by  the  Lieutenant-Governor  of  an  "Irrigation 
council,"  who  may  forbid  any  act  or  course  of  conduct  pro- 
posed to  be  done,  or  entered  upon  by  the  board  of  directors; 
and  without  whose  authority  no  expenditure  can  be  made 
on  any  debenture  issue,  nor  any  contracts  for  construction 
awarded.  All  debentures  issued  under  the  act  must  provide 
for  the  payment  of  the  whole  principal  money  within  30 
years  of  the  date  of  the  issue  thereof,  and  sh",ll  be  repayable 
by  annual  instalments  extended  over  the  whole  of  such 
period,  or  not  less  than  the  last  20  years  thereof.  The  sale 
of  debentures  and  rates  of  interest  are  subject  to  the  ap- 
proval of  the  government.  Moreover,  the  province  has  under- 
taken to  make  a  full  guarantee  of  these  bond  issues,  to- 
gether with  the  interest.    As  previously  stated,  the  Dominion 


Reclamation  Service  makes  all  preliminary  surveys  and  in- 
vestigations as  to  the  feasibility  of  a  project.  When  these 
are  completed,  and  the  boundaries  of  an  irrigation  area  are 
fixed,  the  act  provides  that  a  petition  signed  by  the  owners 
of  at  least  51  per  cent,  of  the  area  involved  shall  be  sub- 
mitted to  the  Minister  of  Public  Works  of  the  province,  ask- 
ing for  the  creation  of  the  district.  After  approval  of  such, 
a  board  of  three  trustees  is  elected  to  conduct  its  affairs. 

Financing  Irrigation 

The  first  district  to  be  financed  under  this  procedure 
is  what  is  known  as  the  "Lethbridge  Northern,"  containing 
an  irrigated  area  of  about  105,000  acres,  which  is  now  well 
under  construction,  at  an  estimated  cost  of  $51.00  per  acre. 
The  total  bond  issue  authorized  for  this  project  was  $5,400,- 
000,  and  of  this,  $4,400,000  worth  of  30  year  bonds  were 
disposed  of  at  a  very  favorable  rate.  Provision  was  made 
for  making  the  bond  issue  large  enough  to  carry  interest, 
and  operation  and  maintenance  charges  until  the  end  of  the 
year,  after  the  completion  of  the  works— so  that  the  farmers 
will  get  the  benefit  of  the  water  before  they  have  anything 
to  pay.  In  the  case  of  the  Lethbridge  Northern  project, 
no  payment  towards  a  sinking  fund  are  required  to  be  made 
until  after  the  seventh  year. 

Construction  has  also  been  commenced  on  another  dis- 
trict known  as  the  "United,"  containing  23,000  acres  irri- 
gable, at  an  estimated  cost  of  $645,000,  or  $28.00  per  acre. 
Several  other  districts  are  in  the  course  of  formation;  and 
the  government  of  the  province  has  announced  as  a  definite 
policy  that  it  will  guarantee  the  bond  issue  for  any  project 
which  has  been  shown  to  be  feasbile,  and  economically  sound 
by  means  of  thorough  surveys  and  investigations  on  the 
part  of  the  Dominion  and  provincial  engineers. 

This  policy  will  no  doubt  have  a  very  marked  effect  on 
irrigation  development  in  Southern  Alberta.  There  are,  how- 
ever, many  problems  which  will  result  therefrom,  such  as 
the  reductions  in  size  of  the  holdings,  and  the  colonization 
of  the  additional  farm  units  created. 

Survey  Board  Created 

Another  matter  which  may  be  of  interest  to  many  is, 
that  this  government  (and  a  Farmers  Government  at  that) 
has  recently  created  what  is  known  as  the  Southern  Alberta 
Sui-vey  Board,  consisting  of  4  outstanding  men,  and  includ- 
ing as  chairman,  the  chairman  of  the  Canadian  Section  of 
the  International  Waterways  Commission.  This  board  held 
their  opening  session  on  November  29th  last,  and  are  now 
sitting,  and  their  obligations  are  to  "Enquire  into,  report  on, 
and  make  recommendations,  in  regard  to  the  undernoted  mat- 
ters affecting  the  welfare  of  those  areas  in  the  southern  part 
of  the  province  which  are  subject  from  time  to  time  to 
drought. 

"(A) — A  policy  in  regard  to  the  development  of  farm 
lands,  which  surveys  of  the  Dominion  Reclamation  Service 
show  the  possibility  of  irrigating. 

"(B)- — Methods  that  may  be  adopted  in  furtherance  of 
the  colonization  of  irrigable  lands. 

"(C) — A  policy  in  regard  to  the  furtherance  of  the 
greater  economic  advantage  of  farmers  on  land  which  can- 
not be  irrigated. 

"(D) — The  expediting  of  the  investigations  by  soil  and 
topographical  surveys  already  initiated. 

"(E) — The  general  financial  conditions  prevailing  in  the 
areas  referred  to,  having  regard  to  the  prime  necessity  for 
the  maintenance  of  credit  of  individuals,  institutions,  and 
municipal  and  school  districts." 

It  is  needless  to  point  out  the  problems  to  be  dealt  with 
by  the  board  are  very  great,  and  upon  their  solution  the 
future  welfare  of  a  very  large  portion  of  the  people  of  the 
province  depends. 

Educational  Work 

In  addition  to  two  experimental  and  demonstration  farms 
maintained  by  the  Federal  Government  in  Alberta,  the  Pro- 
vincial University  is  doing  splendid  woi'k,  and  now  has  a 
three-year  course  in  agi-iculture  leading  up  the  degree  of 
B.S.A.,  in  addition  to  f)  combined  six-year  course  in  arts 
and  agriculture. 


January   6,   1922. 


THE       MONETARY       TIMES 


225 


:b  R:  Ji.  M^  x>  o  M^ 

The  Agricultural  Convention  City  and  Home  of  the  Manitoba  Provincial  Fair 


Famous  For  Its  Exhibition  of  Live  Stock  nd  Farm  Products 

THE  SECOND  CITY  OF  IMPORTANCE  IN  THE  PROVINCE 

An  important  (listril)ulinK'  point  for  AKricultural  Iniplcnicnts  and  Machinery  with  nuni<T(>U!«  nianufac- 
lurinK  industries  and  wholesale  houses.  Scrve<l  by  tlie  Canadian  l*a<'iflf.  Groat  Northern  and  Canadian  Gov- 
ernment Itaiiwnys. 


CONSOLIDATED  BALANCE  SHEET 


FOR   PEUIOn   OF  JAMARY    1st    TO 
OCTOBER   31st,    1921 


ASSETS 

Cash      - 

Cash  advances  returnable 
Lands 

Structures  and  Improvements 
Equipment 

Improvements     under     Con- 
struction 

Stores         -  .  - 

Tax  Lands  held  for  sale 
Amounts    due   the    City    for 
Taxes,  Water  Rates,  etc. 

Sinking     Fund     Investments 


$      28,314.96 

114,762.90 

285,619.06 

2,786,356.16 

215,220.91 

22,337.62 

41,564.85 
5,243.65 

731,267.70 
1,130,741.44 

$5,361,429.25 


lilABFLITrES 

Debentures   Outstanding 
Bank  Loans 
Accounts  Payable 
Debentures  due  and  payable 
Debenture    Interest    Payable 

RESERVES:— 

Debenture   Interest   not    due 
Provincial  and  School  Levies 
not  due 

Depreciation 

Bad   Debts 

New  Construction 

Suburban  Park 

Surplus  -  -  - 


$3,557,246.05 

110,099.90 

119,753.93 

58,000.00 

3,841.64 


53.082.81 

130,681.33 

64.936.02 

27.r>64.n 

25.765.59 

2.714.97 

1,207.742.88 

$5,361,429.25 


STATISTICS— RKAI,  PROPERTY 

Estimated  Value  $22,840,000  As.sessed    $15,232,200  Exempted  .$4,806,920 

Basis  of  Assessment       -        Land  at  Market  Value      -       Buildings  at  two-thirds  market  value 

Tax  Rate  40  Mills  on  $ 


Current  Taxes  paid  in  1920  -        71.5* 

Current  taxes  paid  in  above  period      59.1* 
Area — 5,760  acres. 
Bank  Clearings  1920 — $41,398,339 
Sinking   Fund    Investments — ^1,000,000 

H.  CATER, 

Mayor 


Total  Taxes  paid  in   1920  -        96.5** 

Total  Taxes  paid  in  above  period       80.9** 
Present  Population — 15,500. 
Customs  Receipts  1920— $269,819.43 
Dominion  of  Canada  Victory  Bonds. 

GEO.  F.  SYKES, 

City  Treasurer. 


226 


THE       MONETARY      TIMES 


Volume  68. 


The  Provincial  Grovernment  Department  of  Agriculture 
also  operates  5  agricultural  schools,  and  5  demonstration 
farms,  on  two  of  which  instruction  is  given  on  all  matters 
pertaining  to  irrigation. 

What  is  needed  is  co-operation  and  team  play  between 
the  men  on  the  land  and  those  who  are  endeavoring  to  work 
out  the  broader  questions  affecting  irrigation  development 
on  a  large  scalie;  and  in  such  work,  organizations  such  as 
the  Western  Canada  Irrigation  Association,  and  the  recently 
created  Survey  Board  of  Southern  Alberta,  have  a  large 
part  to  play,  and  should  prove  a  powerful  factor  in  the 
general  welfare  of  the  province. 

.Agriculture  and  live  stock  business  are  the  basic  indus- 
tries of  this  portion  of  the  country,  and  must  go  hand  in 
hand.  Irrigation  stabilizes  both,  and  therefore  stabilizes 
business  conditions  in  general. 


PRODUCTION  OF  COAL  DECREASED 

Output    of    Canadian    Mines   in    First   Six    Montlis    of    1921 
Was  liOwor  Than  In  Previous  Years 

THE  output  of  coal  from  Canadian  mines  during  the 
first  six  months  of  1921  declined  to  86%  of  the  amount 
produced  during  the  corresponding  period  in  1920  but 
was  5%  in  excess  of  the  output  for  the  same  period  during 
1919.  With  the  exception  of  New  Brunswick,  none  of  the 
provinces  showed  an  output  equal  to  the  1920  record.  New 
Brunswick  produced  104%  of  its  1920  output  and  the  other 
provinces  follow  in  the  order  named:  Saskatchewan,  94%; 
British  Columbia,  91%i;  Nova  Scotia,  87%;  Alberta, 
79%. 

In  the  table  given  below  the  output,  shipments,  and 
value  of  shipments  of  Canadian  coal  produced  during  the 
period  have  been  tabulated.  A  part  of  the  data  included 
in  the  table'  has  been  estimated  and  the  figures  are  there- 
fore subject  to  revision.  The  total  value  of  coal  shipped 
during  the  period  amounted  to  $32,882,953  and  the  ave- 
rage selling  price  reported  from  the  different  coal-produc- 
ing areas  ranged  from  $2.43  a  ton  for  lignite  coal  in  Sas- 
katchewan to  $8.53  a  ton  for  anthracite  in  Alberta.  The 
average  for  the  Dominion  was  $5.75.     The  table  follows: 

COAL    BY   PROVINCES    AND    GRADES    FOR   THE    SIX    MONTHS 
ENDING  JUE  30,  1921 

Average 
Value 

Provinces  Output        Shipments       Total  Value    per  ton 

Nova  Scot  la — 

Bituminous     2,750,319  2,257,261  $14,536,760  $6.  ■14 

New  Brunswick- 
Bituminous     69,230  65,768  377,303  5.71 

Saskatchewan—  ' 

Llgnlto     145,394  136,670  332,108  2.43 

Alberla— 

Anthracite     46,402  10,357  88,419  8.53 

Bituminous     1,261,080  1,172,804  5,711,555  4.87 

Lignite     1,125,312  979,021  4,405,594  4.50 

Total    for    Alberta    ..    2,432,794  2,162,182  10.205,568  4.72 

British  Columbia- 
Bituminous     1,385,323  1,094,405  7,431,009  6.79 

Total  for  Canada   6,783,060  5,716,285  $32,882,953  $6.75 

Imports  Increased 
Having  regard  to  importations,  the  data  show  that  Can- 
ada as  a  whole  imported  104%  of  the  amount  of  anthracite 
coal  brought  in  during  the  same  period  in  1920, -and  132% 
of  the  bituminous.  Quebec  was  the  only  province  which 
Imported  less  anthracite  during  the  six  months  than  in  the 
same  period,  1920,  but  even  then,  imported  96%  of  the 
anthracite  coal  received  in  the  half-year  of  1920,  an  increase 
of  12%  over  the  figures  for  1919.  Manitoba  and  the  Head 
of  Lakes  imported  169%  of  the  1920  quota  of  anthracite; 
Nova  Scotia  140%;  New  Brunswick  128%;  Prince  Edward 
Island  108%,  and  Central  Ontario  107%.  In  every  case 
these  figures  show  that  more  anthracite  was  imported  dur- 
ing the  past  six  months  than  in  the  correiponding  six 
months  in  1919. 

Bituminous  coal  entered  at  Fort  William  and  Port  Ar- 
thur and  the  Customs  port  of  Manitoba,  amounted  to  235% 
of  the  1920  figures.  Nova  Scotia  Imported  224%,  as  much 
bituminous  as  during  the  same  period  of  the  previous  year 


but  the  entire  quantity  was  only  some  1,500  tons.  Quebec 
was  more  fortunate  in  the  matter  of  bituminous  than  in 
the  previous  year  and  during  the  first  six  months  received 
179%  of  the  amount  which  was  brought  in  during  the  first 
six  months  of  1920.  Central  Ontario  obtained  115%  as 
compared  with  importations  in  the  first  half  of  1920. 

Central  Ontario  has  received  during  the  first  six  months 
of  the  past  three  years  a  continually  increasing  amount  of 
bituminous  coal,  the  index  numbers  for  the  periods  being 
92%  in  1919;     100  in  1920  and  115  in  1921. 

Exports  Are  Lower 

Exports  of  Canadian  coal  have  declined  from  the  base 
figures  of  100  for  the  six  months  ending  June  30th  to  68 
for  the  same  period  during  the  present  year.  In  1919  the 
corresponding  index  number  was  74.  Total  exports  for 
the  Dominion  amounted  to  869,004  tons  in  1921  as  com- 
pared with  1.278,957  tons  in  the  same  period  in  1920  and 
948,495  tons  in  the  six  months  of  1919.  British  Columbia 
was  the  principal  exporter  during  the  period,  the  amount 
of  coal  shipped  out  of  the  province  amounting  to  517,823 
tons  during  the  period,  representing  87%  of  the  amount 
exported  from  this  province  during  the  same  time  in  1920. 
Nova  Scotia  shipped,  for  foreign  trade,  only  48%  of  the 
amount  of  coal  exported  during  the  six  months  in  1920. 
The  actual  tonnage  of  exports  for  the  six  months  just  closed 
amounted  to  284,601  short  tons. 

The  total  output  of  coal  from  the  mines  of  Canada  dur- 
ing the  first  six  months  of  the  present  year  amounted  to 
6,783,060  tons.  During  the  first  six  months  of  1920  the 
output  was  7,  929,269  tons  and  in  the  same  period  in  1919, 
6,335,532  tons.  Total  importations  of  anthracite  and  bi- 
tuminous coal  during  the  half-year  just  closed  amounted 
to  8,319,246  tons,  as  compared  with  6,768,709  tons  in  1920 
and  6,723,757  tons  in  the  preceding  year.  Export  figures 
have  already  been  given  and  from  these  data  the  coal  sup- 
ply of  the  Dominion  may  be  determined..  The  output  from 
Canadian  mines  plus  the  amount  imported  and  less  the 
quantities  exported,  leaves  an  anlount  which  may  be  qalled 
the  "Coal  Supply."  This  figures  for  the  six  months  of  1921 
was  14,233,302  tons,  as  compared  with  13,419,021  tons  in 
1920,  and  12,  130,  794  tons  in  1919. 

It  thus  appears  that  the  Canadian  coal  supply  for  the 
half-year  as  shown  by  the  index  numbers,  rose  from  90  in 
1919  to  100  in  1920  and  106  in  the  half-year  just  closed. 

COMPARATIVE    COAL    STATISTICS    FOR    THE    DOMirsiON    FOR    THE 

SIX  MONTHS  ENDING  JUNE,  1919,  1920,  1921 

TABLE  7  (a)— OUTPUT  FROM  CANADIAN   rtlNES 

1919                      <920  1921 

January     1,337,852  1,604,775  1,369,294 

February     1,136,188  1,307,034  1.202,978 

March     1,261,534  1,307,478  1,135,965 

April     1,044,288  1,189,274  955,811 

May     951,957  1,169,685  998,213 

June    623,723  1,350,123  1,120,793 

Total    6,355,532  7,929,269  6,783,060 

TABLE  7   (b)— IMPORTS  OF   COAL  INTO  CANADA 

1919  1920                      1921 

•anuary    '. 1,377,463  889,209  1,698,541 

^'ebruary    1,068,781  865^169  1,195,276 

March     784,171  1,432,815  1.202,631 

April     603,099  974,298                 853.358 

May    1,198,127  1,033,301  1,439,297 

June     1,692,116  1.573,857  1,930,143 

Total    6,723,757  6,768,ffl9  8,319,246 

TABLE  7  (c)— EXPORTS  OF  COAL  FROM  CANADA 

1919  1920  1921 

January     465,568  332,763  185,297 

February    84.686  145.004  86,503 

March     129,614  252,189  177,209 

January     1.337,852  1,604,775  1.369,294 

April  .53,056  118.592  79.014 

.May     108.211  193.194  131.650 

June     948.460  234.915  209,.331 

Total    948,495  1,278,957  869,004 

TABLE  7   (d)— COAL  SUPPLY 

1919  1920  1921 

January     2,249.747  2,161.221  2,882.538 

February    2.120,283  2,028,099  2,311,751 

March     1,916.081  2,488,104  2,161,388 

April     1,593,431  2,044,980  1,730.155 

May 2,041,873  2.007.552  2.305.865 

June     2.209.379  2,689.063  2,841,605 

Total     12,130,794  13,419,021  14,233,302 


January  6,  1922. 


THE      MONETARY      TIMES 


227 


-I'll 


llllllllllill 


Hi 


I       MOOSE    JAW       I 

m      Saskatchewan's     Railway     and    Industrial     Centre      m 


Gross   Debenture  Debt    (:!lst  Oct.,   1921)..  $6,030,449.82 
Less: 

General   Sinking  Fund  $    467,997.74 

Electric   Light   1,021,391.41 

Waterworks    1.473,114.73 


Local  Improvements   (own- 
ers'  share)    


^       High    School 


760,611.69 
137,292.34 


3,860,407.91 


Net    Debt    $2,170,041.91 


%   Of 

Sinking  Fund  Investments:  Total 

Rural  Telephone   Debentures  $576,266.28      57.7 

Dominion  o(  Canada  War  Bonds, 

.T%r< 242.398.3:; 

City  of  Moose  Jaw  Debentures  74,536.00 

Mortgages 50,035.51 

Province    of    Saskatchewan    Farm 

Loan   Bonds,   .T/o   25,412.42 

School   District   Debentures  • 11,198.02 

Province  of  Saskatchewan  5%  Gold 

Bonds  8,033.33 

Cash  in  hand  and  accrued  Interest  10,221.29 


7,4 
5.0 

2.6 

1.2 

0.8 
1.0 


Total 


Public  Utilities  (10  months,  1921): 

Expenditure   (including  fixed  charges)   •.  $288,120.43 

Revenue 292,834.33 


Surplus  in  Sinking  Fund  above  legal  require- 
ments   „ $47,269.80 

Light  &  Power  Waterworks 

$134,076.95 

135,113.76 


Surplus  - 


$     4,713.90         $     1,036.81 


Assessment.  1 9J 1  $28,084,852 

Less  Exemptions  5,546,330 


$22,538,522 


■fi»98.101.18     100.0      = 


Land  assessed  at  100' ;  improvements  at  45''  of  their  value 

Total   Assets   _ $  8,683,172 

Total   Liabilities   6,269,79.1 


Surplus: 

Capital  $1,906,076 

Current  507,303 


$  2,413,379 


Tax  Levy  for  all  purposes,  $1,013,085.72  Rate,  46  mills 

The  city  owns  its  own  light  and  power  plant,  which  has  a  capacity  of  6,000  K.W.,  and  power  is 
sold  to  manufacturers  at  from   1.2  cents  per  K.W.   hour  up. 

Moose  Jaw  has  just  completed  its  new  water  works,  which  furnishes  an  abundant  supply  of  water 
for  manufacturing  and  domestic  purposes. 

The  Robin  Hood  Mills  operate  in  the  city  8  distinct  factories  for  the  manufacture  of  food  and 
stock  products.  Their  flour  mill  has  a  capacity  of  5,000  barrels  per  day,  and  their  rolled  oats  plant 
2,000  cases  per  day. 

The  Government  Terminal  Elevators,  situated  in  the  city,  have  a  capacity  of  3,500,000  bushels. 
The  South  Saskatchewan  Co-operative  Stock  Yards,  located  in  the  city,  commenced  operations  in  1919. 
and  now  hold  third  place  in  the  Dominion  for  volume  of  traffic  handled.  The  capacity  of  the  Yards 
exceeds   5,000  head,   and   its  area  is  approximately  8  acres. 


m     R.  H.  SMITH,  Mayor. 


GEO.  D.  MACKIE.  Citv  Commissioner.    M 


11111111,'== 


228 


m,. 


THE      MONETARY      TIME 


Volume  68. 


ADDITIONS  TO  TRADE  MARK  LAW 


Several   Cases  Are  Important   to   Canadian  Industry — The 
Christie  and  the  Bauer  Chemical  Cases 


A  NUMBER  of  decisions  on  trade  mark  law  were  hand- 
ed down  by  Canadian  Courts  during  the  past  year 
and  in  some  of  them,  reviewed  herein  a  great  deal  of  in- 
formation of  general  interest  to  the  mercantile  world  is 
contained. 

One  of  the  cases,  dealing  with  the  use  of  a  trade  name 
■was  based  on  the  use  of  the  word  "  Christie."  In  the  peti- 
tion to  the  Exchequer  Court,  praying  for  an  order  directing 
that  the  trade  mark  "  Christie "  may  be  registered  as  a 
specific  trade  mark  to  be  used  in  connection  with  the  manu- 
facture and  sale  of  biscuits  etc.,  it  is  alleged  that  petition- 
ers are  the  proprietors  of  a  trade  mark  consisting  of  the 
word  "  Christie,"  which  has  been  used  by  them  for  many 
years  in  connection  v.ritn  the  manufacture  and  sale  of  bis- 
cidts,  cake,  puddings  and  infants'  food,  manufactured  and 
•sold  by  them,  and  which  distinguishes  said  goods  from 
.similar  goods  manufactured  and  sold  by  others,  which  said 
trade  mark  is  known  throughout  Canada  as  denoting  and 
distinguishing  the  goods  of  your  petitioners  ;  that  the  peti- 
tioners made  application  to  the  Minister  of  Agriculture  of 
the  Dominion  of  Canada  for  the  registration  of  the  said 
trade  mark  as  above  described  as  a  specific  trade  mark  to 
be  used  in  connection  with  the  manufacture  and  sale  of 
biscuits,  cake,  puddings  and  infants'  food,  in  accordance 
with  the  provisions  of  the  Trade  Mark  and  Design  Act  ;  that 
the  Minister  of  Agriculture,  by  letter  dated  December  15, 
1914,  refused  to  register'  the  said  trade  mark  on  the 
grounds  that  it  is  a  surname,  and  could  be  registered  only 
in  accordance  with  an  order  from  the  Exchequer  Court  of 
Canada  ;  that,  as  a  matter  of  fact,  the  word  "Christie" 
has,  through  long-continued  use  and  extensive  sale  acquired 
a  secondary  and  trade  mark  meaning,  denoting  and  dis- 
tinguishing goods  manufactured  and  sold  by  the  petitioners. 
The  Court  said  :  "I  find  myself  bound  by  the  judgment 
of  the  Supreme  Court  in  the  petition  of  the  Horlick  Malted 
Milk  Co.  to  Have  their  trade  mark  '  Horlick's  registered. 
The  Supreme  Court  have  thought  that  they  were  entitled 
to  register  such  a  trade  mark,  and  directed  by  their  form- 
al judgment  that  the  word  'Horlick's'  be  registered.  The 
case  of  '  Christie '  is  very  much  stronger  than  that  of 
Horlick,'  and  I  am  bound  by  the  judgment  of  the  Supreme 
Court." 

Bauer  Chemical  Case 
Another  case  dealt  with  the  rights  to  trade  marks  cov- 
ering goods  of  German  origin,  namely  Bauer  Chemical  Co. 
&  Sauatogen  Co.  of  Canada.  The  case  was  the  first  that 
has  been  tried  since  the  enactment  of  the  law  involving  the 
rights  to  trade  marks  covering  the  sale  of  German  products 
an  American  company,  to  rights  sold  to  them  by  tne 
sold  in  Canada,  and  it  confirms  the  claims  of  the  plaintiffs, 
American  Trade  Custodian. 

In  England  the  Official  Controller  seized  the  business 
of  the  branch  established  by  the  Berlin  firm  of  Bauer  and 
Company,  voided  their  trade  marks,  and  forfeited  and  s<i1'' 
their  business.  In  the  United  States,  after  entering  the 
war  the  American  branch  of  this  Berlin  firm,  incorporated 
into  a  company,  was  also  forfeited  and  sold  to  the  plaintiffs 
in  the  case  just  concluded.  The  judgment  points  out  that, 
although  the  Canadian  government  passed  a  number  of 
orders-in-council  under  the  War  Measures  Act  respecting 
trading  with  the  enemy,  no  enactment  can  be  found  depriv- 
ing the  plaintiffs  in  this  case  of  the  ownership  of  the  trade 
marks  in  dispute. 

"Castoria"  Case 
In  the  case  of  American  Druggists'  Syndicate  Limited. 
The  Centaur  Co.  regarding  the  use  of  the  word  "  Castoria," 
Mr.  Justice  Carroll  in  the  course  of  his  judgmei.t  made  the 
following  remarks  : — 

"  Nobody  will  contest  to  the  manufacturer  the  right  to 
put  his  own  name  on  his  products  ;  neither  will  anyone  deny 
that  no  other  person  may  usurp   such  name.     No   definite 


legal  enactment  is  required  to  permit  a  manufacturer  to 
place  his  own  name  on  the  products  of  his  industry,  but  for 
diverse  reasons  and  in  his  own  interests,  instead  of  placing 
his  name  on  his  products  so  as  to  certify  their  origin,  he 
will  sometimes  use  some  sign  or  mark.  Such  will  consist 
either  in  several  letters  of  the  alphabet  in  a  word  or  in 
certain  signs,  which  belong  to  nobody  in  particular  and  are 
pubhc  property,  but  which,  by  thus  being  applied  on  the 
manufactured  article,  will  allow  it  to  be  distinguished  or 
differentiated  from  other  similar  products.  The  particular 
manner  in  which  a  trader  will  inscribe  his  name  on  goods 
of  his  personal  make  may,  to  all  intents  and  purposes,  con- 
fer to  that  name  the  character  of  a  mark. 

"Considered  in  its  object,  the  trade  mark,  to  be  con- 
sidered such,  requires  no  particular  labor  or  pains.  It  has 
of  itself  no  literary,  artistic  or  industrial  worth,  and  gives 
none  to  the  object  to  which  it  is  affixed.  In  that  respect  it 
in  no  way  compares  with  patents  which  properly  cover  crea- 
tions of  the  intelligence,  and  by  virtue  of  which  the  law 
grants  to  the  patentees  exclusive  rights  for  a  given  period 
of  time. 

Trade  Marks  and  Patents 

"It  is  impossible,  as  I  said  a  moment  ago,  to  assimilate 
a  trade  mark  and  a  patent.  The  object  covered  by  the 
patent,  whether  it  be  a  literary  or  artistic  work  or  an 
industrial  device,  has  a  great  value.  The  mark,  in  itself 
has  no  value;  its  only  utility  is  that  of  a  certificate  as  to  the 
origin  or  source  of  the  product  to  which  it  is  affixed.  Em- 
ployed by  another,  it  ceases  to  be  the  expression  of  truth  or 
genuineness. 

"  The  patent  differs  from  the  trade  mark  in  that  a  new 
substance  results  from  the  invention.  The  State,  to  en- 
courage the  patentee  and  reward  his  industry,  grants  him 
the  privilege,  during  a  given  period,  to  manufacture  the 
aiticle  invented.  That  privilege  is  not,  however,  conferred 
for  an  indefinite  time,  as  it  would  then  become  a  monopoly. 
Such  is  not  the  case  as  regards  the  general  trade  mark, 
which  once  it  is  registered,  endures  indefinitely,  R.S.C.  1906, 
ch.  71,  sec.  16,  or  as  regards  a  specific  trade  mark,  which 
endures  for  a  period  of  twenty-five  yec.rs,  and  may  be  re- 
newed by  the  proprietor  thereof  or  his  legal  representative 
for  an  additional  period  of  twenty-five  years,  and  so  on 
without  limitation.      (Sec.  17.) 

"  Appellant  company  may  well  manufacture  a  product 
similar  in  its  constituting  elements  to  that  which  respond- 
ent company  offers  for  sale,  but  it  is  precluded  by  law  from 
giving  it  a  name,  the  exclusive  use  of  which  belongs  to  said 
respondent   company. 

■  In  order  that  there  be  no  illegal  competition  between 
two  coinmorcial  products  of  the  same  nature,  their  respec- 
tive names  or  ciesigtiat^'^ns  must  be  sufficiently  distinct  that 
the  purchaser  may  not,  as  I  have  already  said,  be  led  to 
mistake  one  for  the  other." 

"Cutex"  Trade  Mark  Case 

As  to  the  petition  of  the  Northern  Warren  Corporation 
in  regard  to  the  registration  of  the  word  "  Cutex "  as  a 
general  trade  mark,  Justice  Audette  held  that  a  genera! 
trademark  may  be  registered  with  a  limitation  to  exclude 
certain  classes  of  goods  for  which  a  specific  trademark  not' 
absolutely  similar  has  been  registered. 

In  explanation.  His  Lordship  says  :  "  This  is  an  appli- 
cation to  register  as  a  general  trademark  the  word  "  Cutex  " 
to  be  used  more  especially  in  connection  with  manicure  and 
toilet  preparations,  which  are  manufactured  and  sold  by  the 
petitioners. 

"This  application  for  registr&tion  was  refused  by  the 
Minister  of  Trade  and  Commerce  by  reason  of  the  existence 
on  tlie  register  of  a  certain  trademark  consisting  of  the 
words  "  Randolph  Cuties "  registered  October  29,  1914,  in  . 
favor  of  J  ">"■  Tandenberger  and  Co.  of  Philadelphia,  Pa., 
as  a  specific  trademark  applied  to  hosiery  and  underwear 
and  by  reason  of  a  further  registration  of  the  words  "Cute 
Brand"  registered  August  20,  1914,  in  favor  of  J.  S.  Todd 
and  Son,  of  Victoria,  B.  C,  as  a  specific  trademark  applied 
to  canned  salmon. 


January  6,   1922. 


THE      MONETARY      TIMES 


229 


P 


rovince 


Alberta 


AREA  255,585 
Sq.  Mi. 


ESTIMATED  POPULATION 

640,000 


TOTAL     RAILWAY 
MILEAGE    4696 


Boundless  Resources  as  yet  Unexploited 
Climate  and  Soil  unexcelled  for  Agricultural  Purposes 


Finhiaccd  in  Itic  E'rovlnre  are 
tC3,382,400  acres,  of  which  It  |3  esll- 
rimicd  at  least  tOil.OOO.OOO  acres  are 
available  for  enlllvalion.  riiirliij?  the 
year  Ili-.'O  nearly  iji/,  irilllion  acres 
were;  In  crop,  anil  the  estltnaled  value 
or  rarni  [irodncts  for  that  vear  Is 
»l8i,i1.''),.-|.>i.0S,  details  or  which  are 
included   In   lUc  followlnir  sialenient: 

A(;HICULTURAL  PBODllCTS   1920 

All    Wheal    .tlll.90«,IS8.08 

<  lats    36,829. «i.(}|| 

Barley     7,&43,ll3.80 

I'lax   1,088,8D0.(M 

Hyo    1,275,500.00 

Ml.xeri  .Grains  1i9,ll9.0i) 

Hay  and  Clover 9,971,700.00 

Alfalfa   I,07(,9l5.nn 

Polatoes  7,525,000.00 

Turnips,  Mangolds,  etc..  3,69fl,iX)0.oo 

I'eas 123,207.50 

Deans   y.  156,740.00 

»18i,415,55i.98 

Anlinal.s    38,000,000.00 

Hairy    Products    34,000,000.00 

\Vo(d  t;llp  7.30.900.38 

Game  and  Furs  8,250,000.00 

poultry  ana  i-rortucts  ..  s,000,000.00 

Horticulture     2,285,000.00 

Total    $266,681,455.36 

LIVE  STOCK.   1920 

Horses    t  66,766,590.00 

Milch    Cows    24.448,.560.0<l 

Other  Cattle   52,516,700.00 

Sheep  and  Lambs  3.831.240.00 

.SWIno     5,731.120.00 

Poultry    2.879.826.00 

Total    1156.177,036.00 


PKOGRKSS    IN    GRAIN    PRODLCTION 

Alberta  Is  well  adapted  to  the 
growing  of  the  staple  grains; 
wheat,  oats,  barley,  rye  and  flax,  and 
great  progress  has  been  shown  In  the 
last  ten  years.  In  1911  production 
was  (bushels):  Wheat.  2(>.06«.9.'<T ; 
oats,  27,604,993;  barley,  3,037,58.1;  nax, 
1.'j3,«08;  rye,  38,722,  while  In  1920  pro- 
dncllon  had  Increased  to  (bushels); 
Wheat,  83.526,901;  oats.  115,091,523; 
barley,  12,738,523;  flax,  725.91K);  rye, 
3,420,400. 

DAIRVING 
"The  Dairy  Indflstry  of  the  Pro- 
vince showed  satisfactory  progress 
during  the  past  year.  The  value  of 
the  milk  and  the  milk  products  was 
slightly  more  than  »34,ooo,iH)0.00,  an 
Increase  of  10  %  over  the  pri'vlous 
year.  Although  there  was  a  slightly 
larger  production  In  1020,  the  In- 
crease In  the  value  of  Uie  products 
was  due  iirlnclpally  to  the  higher 
'  price  ruling  during  the  (Irst  nine 
months  of  Uie  year. 


.STATKMENT    W    ASSKT.S    A\l»     I.IAIIILITIK.S    AT 

DECEMIIKK  31>l,   I92U 

ASSETS 

Cash    In    nank    »     a45.237.1« 

Telephone    Plant,    Stock   and 

Tools      »15,834,39-1.00 

Less   Depreciation  and   Re- 
newal   Reserve        250,000.0 

15,584,394.90 

Public   HuUdlngs     (Including    Stock    Ad- 
vance)                                9,214,967.10 

lirldges                 3,313,608.93 

Trunk     Roads     and     Bridges     thereon. 

Ferries,    etc 5.151,439.  M 

Province  of  Alberta  4%   Debentures  due 
lQ2<j                           .. 171,668.76 

Intcrpsi-hoitriiiir    loans         .            5.401.298.63 

Repayable     Working    and     Improvement 
Advances    (Including   Drought   Relief)..      1,600,848.72 

Shares  Lacombe  and  North  Western  Rail- 
way                       2,031.85 

Miscellaneous                   360,392.97 

»45.784.S(n.40 
Deposit    (In    Hen    of   debt)    in    hands    of 

Deposit  (School  Lands  Fund)    »5.972.000.00 

Deferred   and   Overdue   pay- 
ments     of     principal      on 
School   Lands     7.416,456.12 

13.388.456.12 

Unsold  School  Lands— 6.830,618.61  acres  at 
112  00  per  acre     81,967,783.32 

1149,248.246.84 
LIABILITIES. 

Debentures    and    Registered    Stock    Out- 
standing                                     Ill, 989,900. 00 

less   SInkine   Fund    1,231,159.20 

♦40.758.740.80 
Temporary    Loans    (Savings    Certincales 

included)        3.774.900.55 

Municipal  Sinking  Funds  54,121.69 

Balance— Excess  Assets  over  Liabilities..  104.660,483.80 

Ili9.2l8,24l-..8l 

COAL  I\DIISTR\ 

"Alberta  with  Its  almost  unlimited  coal  resources,  as  yet 
for  the  most  part  unexploited,  stands  fourth  In  all  Canadian 
Provinces    In   nUneral   productions. 

"  Coal  production  alone  In  the  year  1920  almost  equalled 
In  value  the  total  mineral  products  of  British  Columbia  In 
the  previous  vear.  being  for  the  year  ending  December  Slsl. 
1920,  133,910,240.00  made  up  as  follows. 

Output.  Value. 

Domestic    Coal    3.359,3a8  tons  115.1  P",--" 

Bituminous   Coal    3,419,021     ,,  17,09: 

Anthracite  Coal      130,594    ,.  1,01.: 

6,908.923    ..  »33.2:.(-.7i7  l>ii 

Briquettes     101.922    ..  e<6-.'.iy;i  i  > 

7.010,845    „  »33.9l9,2ii>  i» 


"The     nfty-ihrce  ■•■■rt\ 

were  oiierallng  In  ■'•  <■  i 

12.150,000  pounds  of  I.......    .....cd  at 

$6,864,750.00,  and  the  seven  cheese 
factories  manufaclured  56.534  pounds 
of  cheese  valued  at  tl!8.8$9.00. 

"In    view    of    the    severe    climatic 
conditions,      and    the     sraniiv      and 
high  price  of  food  dun; 
part  of  the  year,  it  Is  t- 

note   that   the   total   oulp- :y 

products  for  1920  was  greater  Una 
that  of  the  previous  year." 

GENERAL   INFORMATION 

TInihrr.  Except  In  -the  S.E.  and 
the  extreme  >'..  till'' "■■  -  ■  icn'ifni. 
though  small.    The  f 

the    Rockies    are   w  ■  I 

the  streams  are  thu  ».,. M 

spruce,  pine,  poplar  and.  w^illow. 
Central     Alberta,     the     Park    County. 

1<  ;    -•  ■"■    '<••    aspen  being  the 

inn  lillc    spruce    pre- 

don  the  Rockies  and 

the  I  r.iiin-  .i-iiii  jnd  balsam  N.  of 
Saskatchewan.  Athabasca  and  Peace 
Rivers.  In  the  north,  poplars  trow 
I  ft.  In  diameter,  and  straight  for  18 
ft.,  in  the  Mackenzie  basin,  white 
and  black  spnice,  tamarack  (UrcD>. 
Jack  Pine,  birch  and  white  poplar  are 
found. 

TRANSPORT.ATION        .AND 
COMMl'NICATION 

Ralluavs.  :<  transcontinental  lines 
run  froiii  east  to  west,  the  C.n.R. 
formerly  Canadian  Northern  and 
r.rand  Trunk  Parlflc.  through  Edmon- 
ton, the  C.P.R.  southern  line  through 
Lethbrldge  and  Macleod.  C  I'll.  ?for- 
thern  line  through  Calgary.  Branch 
lines  run  In  every  direction  In  the 
southern  and  central  portions.  In  the 
north,  the  Edmonton.  Dunvegan  and 
lirltish  Columbia  Ry..  now  operated 
bv  the  CPU.,  runs  to  Spirit  River. 
The  Alberta  ami  fireai  Wat^rwaj  Ry. 
runs  to  Fort  McMurray.  A  branch  of 
the  Central  Canada  liy.  runs  from 
McLennan  across  the  Peace  River. 
In  1920  there  were  4,596  mllM  of 
comideted   railways. 

I .  vinclal  Cov- 
er' one  systciD. 
i.n  ''Head  rrom 
Ci'  'rom  Eastern 
to  ng  an  area 
i.f  .in.l     about 


Liver  ll.iK-v  (jrais  hi\c  l<  U'i  tioaci. 
Trlrqraph.     Thr   C.P.R.    antl   CN.R. 


ha> 

li:. 
oi- 


'S  along  railway 
uon  Oovemmenl 
Peace  River. 


liiciitcnant-Oovernor,  Hon.  R.  G.  Brett;  Premier,  President  of  Counrll,  Provincial  Secretary  aad 
Provincial  Ti-oa.siirer,  Hon.  H.  Greenfield;  Attonu-y  Cirnoral,  Hon.  J.  K.  Brt>wnl«>>;  >lini>ter  of 
PiiMic  Worlis,  Hon.  .\lox.  Ross;  Minister  of  Munidpal  .\ITairs  and  Henltli,  Hon.  R.  (J.  ll<'id;  Min- 
ister of  UailHays  and  Telephones.  Hon.  V.  W.  Sniitli:  >Iiiii.ster  of  .AKri<ultun>,  Hon.  <i.  H<'a«lley; 
Minister  of  Kducatlon,   Hon.   P.   K.  Baker;    Minister  Without  Portfolio.  Hon.  Mrs.  I.  Parlby; 


230 


THE       MONETARY       TIMES 


Volume  68. 


"  There  is  further  record  of  a  consent  by  Landenberger 
and  Co.  that  if  hosiery  and  underwear  are  excluded  that 
the  woird  "  Cutex  "amy  be  registered  as  a  general  trade- 
mark in  favor  of  the  petitioners.  Furthermore,  there  is 
also  filed  n  frencral  if.nsent  by  J.  S  Todd  and  Son  to  the 
registration   of  tlie    retitiorers'   trademark   as   prayed. 

"  In  the  present  application  to  register  the  word 
"  Cutex  "  it  may  be  said  that  the  words  "  Randolph  Cuties" 
and  the  words  "  Cute  Brand  "  bear  some  distant  resem- 
blance to  the  word  "  Cutex  "  but  they  are  not  the  very  same 
words  and  they  are  not  likely  to  deceive  uncautious  pur- 
pii„-„^„  because  the  other  words  resembling  the  word 
'  Cutex"  are  in  both  the  other  trademarks  associated  and 
accompanied  by  another  word  when  used. 

"Therefore  I  have  come  to  the  conclusion  to  allow  the 
petitioners  to  register  in  their  name  the  word  "  Cutex  "  as 
their  general  trademark,  limited,  however,  by  excluding 
therefrom  the  use  of  the  said  word  "  Cutex  ".  as  applied  to 
hosieries  and  underwear  as  well  as  to  canned  salmon." 


DEVELOPMENTS    IN    AUTOMOBILE    INDUSTRY 

On©  of  Most  Important  Was  General  Motors'  Decision  to 
I'se  Canadian  Plant   For  Export  Pro<luction 

CONTRIBUTED 

AMONG  the  important  features  of  the  progresg  of  Can- 
ada's automobile  industry  during  the  year  just 
ended  was  the  decision  of  the  General  Motors  Corporation 
to  concentrate  its  export  business  at  the  Canadian  plant 
at  Oshawa. 

From  Ford,  Ontario,  The  Ford  Motor  Company  of  Can- 
ada sends  its  cars  throughout  the  British  Empire.  Other 
manufacturers  also  use  their  Canadian  plants  as  distribut- 
ing headquarters  for  their  export  trade.  For  the  past 
three  fiscal  years  the  figures  show  that  Canada  has  export- 
ed the  principal  Dominions  of  the  British  Empire  the  fol- 
lowing number  of  cars  and  trucks  together  with  the  value 
of  automobile  parts   given   below:  — 

Cars  Trucks     Parts  Value 

Australia 11,306  2,093  $1,099,266 

India 7,406  1,439  965,902 

Straits    Settlements     ..     ..      2.618  387  348,338 

British   South  Africa..     ..      5,584  557  548,333 

British    West    Africa    ....      1,124  §52  174,694 

New  Zealand 6.734  2.058  .     622,019 

Figures  recently  published  show  the  extent  of  the 
Empire   market   for   automobiles: 

No.   of 
Dominion  Population  Avitomobiles 

Australia 5,000,000  78,000 

South    Africa 6,000,000  29.000 

West   Africa 23,000.000  2.000 

India 315,000,000  25,550 

New   Zealand 1,226.000  30,000 

To  these  Dominions  must  be  added  Great  Britain  and 
the  other  overseas  units  of  the  wide-spread  British 
Empire;  these  latter  will  call  for  more  and  more  auto- 
mobiles  as   they   develop   and   grow. 

Canada's    export    trade    is    not    confined    to  the    British 
Empire,    but    embi-aces    oth^    countries,    and    the      total 
annual  value  of  automative  products  exported  is  in  excess  ' 
of    $25,000,000. 

Industry  Twenty  Years  Old 
As  Canada's  automotive  industry  travels  along  its 
third  decade,  various  problems  are  being  discussed.  What 
Is  known  as  "the  saturation  point"  is  among,  the  most 
prominent,  though  this  is  being  proven  to  be  more  theor- 
etical than  real,  as  shown  by  Mr.  T.  A.  Russell,  vice- 
president  of  the  Russell  Motor  Car  Co.,  who  in  a  recent 
speech  drew  attention  to  the  factor  of  "replacement,"' 
mentioning  that  the  average  life  of  a  car  was  six  years. 

Using  figures  of  registrations  on  this  basis,  at  the 
end  of  1914  there  were  69,598  cars  running,  which  dur- 
ing 1921  have  become  obsoleted.  The  registration 
figures  at  the  end  of  1921  will  be  closely  examined  by 
all  engaged  in  the  automotive  industry,  especially  in  view 


of  the  difliculties  in  making  sales  during  the  past  year, 
to  see  if  cars  of  six  years  and  over  are  being  eliminated 
to    the    extent    mentioned. 

Many  Companies  Formed 
The  Monetary  Times  has  drawn  attention  to  the  num- 
erous automobile,  truck,  tractor,  and  accessory  companies 
formed  in  Canada  during  the  past  year,  only  a  few 
of  which  have  actually  reached  the  productive  stage. 
Promoters'  selling  points,  technical  arguments  and  poli- 
tical statements  have  been  arrayed  against  the  imported 
car  and  for  the  "Made  in  Canada"  article.  Without  taking 
sides,  it  may  be  mentioned  that  some  interesting  considera- 
tions have  to  be  taken  into  account  in  either  case.  Take 
a  car  that  sells  for  $1,000  in  the  U.  S.;  in  Canada  this 
will   cost  something  like  this: 

List  price $1,000 

Dealer's    price     $     800 

New    York    Exchange,     10%     .  80  80 

Customs    Duty,    35%  on  $880...       308  308 

Sales  Import  Duty,  4%  on  $1,188         47  47 


Dealer — $1,235     Purchase — $1,435 


Or.  in  round  figures,  a  car  listed  at  $1,000  sells  tor 
about   $1,500   in   Canada. 

But  supposing  the  car  was  actually  "made  |in  jCan- 
ada."  smaller  volume  would  mean  larger  overhead;  there 
would  be  customs  duties,  etc.,  etc..  on  raw  materials 
imported,  so  that  actual  price  would  probably  not  be  less 
but  rather  more  than  above,  until  sufiicient  volume  could 
be  obtained. 

Then  take  usual  procedure  of  assembling  car  in 
Canada  from  parts  supplied  by  Patent  U.  S.  Company. 
Here  the  benefit  of  larg-e  volume  reduces  overhead,  but 
duty  has   to  be  paid   on   parts   imported. 

sT  it  will  be  seen,  to  produce  a  low  price  car  in 
Canada  many  intricate  factors  are  involved  which  stock 
fvalesmen  do  not  understand  or  discuss  when  trying  to 
peddle   their    offerings. 

Motor  Transportation 

One  cannot  look  back  over  the  past  automotive  year 
without  noting  the  increased  usage  of  the  motor  truck 
in  Canada.  The  former  on  the  prairie  hauls  his  grain 
by  truck.  The  gypsy  in  his  perambulations  has  forsaken 
his  horse  caravan  for  a  gasoline  palace.  Freight  is  car- 
ried hither  and  thither  by  huge  trucks.  The  motor  bus 
plies  on  regular  schedule,  transporting  the  city's  crowds, 
or  earring  children  to  the  rural  school.  Thus  the  motor 
truck  has  become  a  sturdy  competitor  and  also  a  worthy 
co-partner  with  the  railways,  and  its  uses  increase  with 
time. 

The  Future  Outlook 

What  is  tffe  future  outlook  for  the  automotive  indus- 
try in  the  Dominion?  Practically  every  make  of  car 
manufactured  in  the  U.  S.  is,  or  has  been,  sold  in  Canada. 
British,  French  and  Italian  cars  also  in  evidence,  as  well 
as  some  other  European  makes,  these,  together  with 
Canadian-made  or  assembled  cars,  totalled  at  the  begin- 
ning of  1921  about  407,000  automobiles  licensed  in  all 
the  provinces.  This  means  a  car  for  every  20  persons. 
During  the  past  year,  it  is  estimated  some  50.000  more 
automobiles  were  sold,  and  if  anything  like  normal  con- 
ditions prevail  a  similar  number  will,  in  the  coming  year, 
find  purchasers.  From  reports  like  those  issued  by  the 
parent  Studebaker  Corporation,  it  may  be  assumed  that 
the  automobile  manufacturers  will  engage  in  an  extensive 
advertising  campaign,  coupled  with  scientific  salesman- 
ship to  the  superlative  degree.  As  to  the  export  market, 
probably  the  exchange  problem  is  the  hardest  one  to  be 
combatted  there.  But  the  automotive  industry  in  Canada 
is  led  by  executives  who  are  able  and  alert  to  handle 
whatever  situations  may  present  themselves,  so  taking 
everything  into  consideration,  the  automotive  industry, 
which  is  a  wonder  among  modern  financial  and  engineer- 
ing achievements,  will  continue  to  expand  and  grow 
during  the  coming  year,  which  is  greeting  It  with  a  fair 
outlook. 


January   6,   1922. 


THE       MONETARY       TIMES 


2St 


Rich  In  The  Elements  of  Success 

Agreeable  climate,  great  natural  wealth,  immensely  productive 
soil,  cheap  power,  efficient  labour,  prosperous  and  constantly 
growing    urban    and    rural    population,    stable    goveniment. 

ONTARIO 

Offers  Great  Opportunities  For  Farmers,  Miners,  Manufacturers  &  Investors 


^w 

W^^^ 

Live  St 

m 

THK  I'noviNCE,  though  great  In 
riirosis,  minerals,  water  powers 
aiifl  iriiiiiiifac'Hires,  Is  chiefly  agrl- 
culiuial.  Possessed  of  much  ex- 
oellem  soli  and  a  (Ine  climate, 
the  Province  Is  Just  at  the  begin- 
ning of  development.  The  vast 
and  rerllle  area  of  Northern  On- 
tario provides  opportunity  for 
millions  to  nnd  health,  happiness 
and    financial   Independence. 

THK  MAGNITIIPE  and  possibilities 
of  Dairying  mark  the  Province  as 

one  of  the  most  Inviting  In  the 
llomlnion.  The 
output  or  Cheese 
Factories,  Cream- 
eries, Condens- 
crles  and  Milk 
Powder  Fac- 
tories, together 
with  milk  de- 
livered In  towns 
and  cities  and 
butter  made 
upon  the  farm, 
indicates  a  total 
probably  in  ex- 
cess of  any  other 
line  of  agricul- 
tural Industry. 


THE  COMMANP- 
TNO  position  of 
Ontario,  Its  In- 
vigorating c  I  1  - 
mate,  fertile 
soil,  pure  and 
plentiful  water, 
nulrillvo  gra.sses, 
grains  and  roots, 
advanced  stale  of 
agriculture  and 
character  of  peo- 
ple have  made 
the  Province  the 
home  and  nurs- 
ery of  live  slock 
for  Canada  and  a 
1  a  r  g  e  i>art  of 
America. 


FINANCIAL  HOUSES  every- 
where recognize  that  Ontario's 
securities  are  classed  as  "gllt- 
edgeU." 


ESTIMATED  ASSETS 

Pine   Timber    1132,000,000 

Pulliwood  Timber, 
Ties,  Poles,  Hard- 
wood,   etc 23S,0O0,00O 

Mining    Lands    and 

Profits     100,000,000 

Agricultural  Lands.      15,000,000 

Water   Powers    20,000,000 

.Sand,  Gravel,  etc..  1,000,000 
Dlst.  of  Patricia, 
area  of  146,000 
miles.  Timber, 
Fisheries,  Furs 
and  Mining  Possi- 
bilities          10,000,000 


THE  TIMn)n  HESOURCES  of  the 
Province  arc  among  the  most 
valuable  on  the  continent,  there 
being  sco.ono  s<i.  miles  of  avalLible 
forest  areas.  The  pine  Is  the  best 
in  (piallty  found  on  the  American 
continent  and  Is  In  constant  de- 
mand. Hardwoods  used  In  furni- 
ture and  modern  interior  equip- 
ment are  available,  and  of  pulp- 
wood  the  Province  has  resources 
niiuiinifl  to  3on,oiKi.iKio  cords  at 
least. 

IMJWER  IS  plentiful  and  Is  sold 
at  low  rales  to  Ontario's  citizens. 
The  developed  water  power  Is 
98.'>,000  h.p.  and 
there  Is  6,000,000 
h.p.  of  undevel- 
oped water 
power  available 
within  conveni- 
ent reach  of 
commercial  d  e  - 
velopment.  Rapid 
progress  In  this 
respect  Is  being 
m  a  a  c  by  pulp 
and  pa|ier  mills, 
power  companies 
and  the  Ontario 
Hydro  Commis- 
sion. 


jl503,000,000 
Taxable  property 
in  Ontario  act- 
ually assessed 
by  Muntclpall- 
lles,  over    »«,000,000,0l)0 


THE  FRUIT  REI.T  of  Ontario  ex- 
tends 200  miles  from  E.  to  W., 
and  N.  and  S.  for  l,'iO  miles  at  the 
widest  point.  Ii  Is  no  small  oasis 
in  the  desert,  but  a  garden  In 
process  of  realization  on  the 
grandest  scale.  The  yield  at  pres- 
ent Is  llmlled  only  by  the  want 
1  r  adequate  labour.  Crapes  and 
peaches  grow  luxurlanily.  An 
aiiihorlly  says:  "We  have  the 
l.'iud,  the  sunshine  and  the  rain: 
only  we  need  more  men — more 
enthnslasilc  fruit  growers  —  to 
lake  advantage  of  these  favourable 
<(mdltlons." 

THE  CARIXKT 


THE     MINERAL 

resources  of  On- 
tario cover  prac- 
tically the  entire 
list  of  commer- 
cially valuable 
melalllcs  and 
n  o  n  -  melalllcs 
wlih  the  excep- 
tion of  coal  and 
tin.  The  Sud- 
bury camp  Is  the 
world's  chief 
source  of  nickel. 
Ontario  contrib 
iiles  over  45%  of 
the  total  mineral 
production  o  f 
Canada. 


HIE    FUTURE    for  Ontario  manu- 
factories   Is    Indeed    brilliant. 
Hydraulic  power  Is  In  abundance 
arid    Is   cheaper   than   can   be   de- 
rived from  coal.    Kxplorailon  con- 
stantly Increases  the  visible  store 
of    raw    nialerlals.      Ample   trans- 
I'urlalion    racllllles    are    provided 
liv    a    network    of   rallwavs.    con- 
slainly    Imiirovlng   |ii^-ii«n<     nn,) 
eMensive     inland     «  A 

prosperous  popula!  s  a 

ready    market.     Oni......    .,..-    half 

llie  factories  of  Canada  and  pro- 
iluces  almost  every  kind  of  manu- 
faciured  article.  As  a  proniablc 
(leld  for  manufacturers,  (mtarlo 
has  few  equals  and  no  superiors. 


^    POWER 


Mining 


Mcut.-Cdvernor:      Mis    lliinor    Colonel     Henry    Cockshutt;      Prime    MiiiMer  and  Prrslilenl  of  Caunril:    HON.  K.  ( .  ItniHV:    .%tl*rnivv 
(ienerHl,  linn.   W.   V..   Hiiiie>  :   Treasurer.   Hen.  Peter  Smith;   Srcrpliir.i    iinil    Itriil-lriir.   Hon.    II.    (".   M\im:    Mlni'.lr     ni    Kduratlon.   Mod. 
It.  II.  tirftnl:   Minister  or  i'lihllc   Works,  linn.  K.  C.  IIIriis;   Minl-Irr    oi    lands.    Knrrs|>   unil    .MIno,   Hon.   Rrniuli    lln.tman;    Minl^lrr  at 
Alirlculture,     iiiiii.     ».     W .     l>flhrrl>  ;     Mlnl-ler     of     l.alior     anil      Hriiini.    lion.    W.     R.     Holln:     MinMrr    of    Mine-.,    Hon.     H.    Mlilv: 

Wllhoul   l*ort(olin,   Hon.  it.  (Hrinlchiiel. 


232 


THE      MONETARY      TIMES 


Volume  68 


Powers  Under  Dominion  and  Provincial  Charters 

Privy  Council's  Decision  in  Great  West  Saddlery  Case  Was  Important 
Addition  to  Company  Law  of  Canada — Dominion  Companies  Not 
Required  to  Obtain  License  Under  Certain  Clauses  of  Provincial  Acts 


In  February  25th,  192],  the  Judicial  Committee  of  the 
*  Privy  Council  pronounced  judgment  in  the  case  of  the 

Great  West  Saddlery  Co.  v.  The  King — a  case  which  involved 
appeals  from  Ontaria,  Manitoba  and  Saskatchewan  and 
which  made  far  reaching  change  in  the  interpretation  of 
the  Companies  Acts  of  those  provinces.  The  judgment  was 
mainly  concerned  with  the  powers  of  provincial  legisla- 
tures to  make  regulations  for  Dominion  companies  trading 
within  the  borders  of  the  provinces  over  which  they  hold 
jurisdiction  and  in  addition  also  decided  under  what  type 
of  provision  a  provincial  legislature  might  make  regula- 
tions for  the  holding  of  land  within  the  province  by  an 
extra  provincial  company. 

Siuninary  of  Decision 

In  brief,  the  judgment  of  their  Lordships  is  as  follows: 
A  company  incorporated  by  the  Dominion  under  the 
Companies  Act  of,  Canada  (R.  S.  Can.,  1906,  c.  79),  with 
power  to  trade  in  any  Province  may,  consistently  with  ss. 
91  and  92  of  the  British  North  America  Act,  1867,  be 
subject  to  Provincial  laws  of  general  application,  such  as 
laws  imposing  taxes,  or  relating  to  mortmain  or  requir- 
ing licenses  for  certain  purposes,  or  as  to  the  form  of  con- 
tracts; but  a  Provincial  Legislature  cannot  validly  enact 
for  the  enforcements  of  such  laws  sanctions  which  if  ap- 
plied would  sterilize  or  destroy  the  capacities  and  powers 
which  the  Dominion  has  validly  conferred. 

Accordingly,  the  Extra-Provincial  Corporations  Act  (R. 
S.  Ont.,  1914,  c.  179),  the  Companies  Act  (R.  S.  Man.,  1913, 
c.  35),  and  the  Companies  Act  (Stat.  Sask.,  1915,  c.  14), 
so  far  as  they  purport  to  preclude  Dominion  trading  com- 
panies from  carrying  on  their  business  in  the  Provinces 
unless  registered  or  licensed  thereunder,  or  subject  such 
companies  to  penalties  for  so  carrying  on  business,  are  ul- 
tra vires. 

Sect.  29  of  the  Companies  Act  of  Canada  (R.  S.  Can., 
1906,  c.  79),  which  purports  to  enable  a  Dominion  com- 
pany to  acquire  and  hold  real  estate  requisite  for  the  carry- 
ing on  of  its  under.taking,  does  not  prevail  against  a  sever- 
able provision  of  a  Provincial  Legislature  restricting  the 
power  of  corporations  generally  to  acquire  and  hold  land 
in  the  Province.  Accordingly,  the  Mortmain  and  Charit- 
able Uses  Act  (R.  S.  Ont.,  1914,  c.  103)  is  valid;  but  the 
provisions  of  R.  S.  Man.,  1913,  c.  35,  and  R.  S.  Sask.,  1915, 
c.  14,  as  to  the  holding  of  land  'by  Dominion  companies, 
are  Invalid,  since  the  provisions  are  not  severable  from  the 
invalid  provisions  referred  to  above. 

By  the  judgment,  the  decisions  of  the  Supreme  Court 
of  Canada  and  of  the  Supreme  Court  of  Ontario  (on  the 
Ontario  appeal)  were  reversed,  the  decision  of  Justice  Mas- 
ten  of  the  Supreme  Court  of  Ontario  being  upheld. 

Opinion  of  Justice  Masten  AtHnned 

Their  Lordships  summarize  Justice  Masten's  decision 
in  these  words: 

"Masten,  J.,  before  whom  the  cases  came  in  the  first 
instance,  was  of  opinion  that  in  passing  the  Extra-Provin- 
cial Corporations  Act  the  Legislature  of  Ontario  had  ex- 
ceeded its  powers.  He  pointed  out  that  the  Dominion  Com- 
panies Act  had  vested  in  the  companies  incorporated  un- 
der its  provisions  all  the  powers,  privileges  and  immunities 
requisite  or  incidental  to  the  carrying  on  of  its  undertak- 
ing, and  that,  in  view  of  the  decision  in  the  John  Deere 
Plow  Case,  the  power  conferred  on  the  Parliai.ient  of  Can- 
ada to  regulate  trade  and  commerce,  and  to  that  extent 
to  prescribe  these  capacities  in  cases  affecting  the  Domin- 
ion at  large,  must  be  taken  to  be  paramount  and  overrid- 
'.ns.     He  thought  that  s.  7  of  the  Extra-Provincial  Corpor- 


ations Act  afforded  the  keynote  and  the  "pith  and  sub- 
stance" of  that  Act,  the  purpose  of  which,  as.  applied  to 
Dominion  companies,  was  to  preclude  them  from  the  ex- 
ercise of  some  of  their  powers  and  to  deprive  them  of  their 
status  in  Ontario  unless  a  license  were  obtained  and  cer- 
tain fees  paid  there.  However  simple  and  little  oppressive 
such  a  process  might  be,  it  constituted  none  the  less  a  di- 
rect interference.  It  had  been  attempted  to  support  this 
interference  as  justified  by  the  powers  conferred  by  s. 
92  on  the  Provinces  to  raise  revenue  by  direct  taxation, 
to  deal  with  property  and  civil  rights,  particularly  from 
the  point  of  view  of  mortmain,  to  legislate  for  the  admin- 
istration of  justice,  and  to  impose  penalties  in  furtherance 
of  these  ends.  But  in  the  opinion  of  the  learned  judge 
these  aspects  of  what  had  been  included  in  the  Provincial 
statute,  except  in  the  case  of  the  mortmain  law,  had  been 
introduced  into  it  in  reality  only  as  ancillary  to  s.  7,  and 
to  the  main  purpose  of  asserting  a  direct  control  over  the 
Dominion  companies  before  permitting  them  to  carry  on 
their  business  in  the  Province.  This  purpose  so  permeat- 
ed the  whole  Act  that  it  was  not  practica'ble  to  hold  certain 
of  its  sections  valid  and  others  invalid.  The  provision  of 
s.  9,  sub-s.  2,  which  excluded  from  any  license  to  be  re- 
quired limitations  or  conditions  restricting  the  rights  of  the 
company  to  carry  on  in  Ontario  all  such  parts  of  its  busi- 
ness and  powers  as  by  its  Act  or  Charter  of  incorporation 
it  mifeht  be  authorized  to  exercise  there,  did  not  mend 
matters.  But  the  provisions  of  the  Ontario  Mortmain  Act 
stood  on  a  different  footing.  For  the  incapacity  to  hold 
lands  did  not  arise  because  of  the  application  of  the  Extra- 
Provincial  Corporations  Act,  but  because  of  the  general 
scope  of  the  Mortmain  Act  itself,  a  separate  statute  which 
the  learned  judge  seemingly  regarded  as  within  the  pow- 
ers of  the  Province. 

Supreme  Court  of  Canada — Davies,  C.  J. 

In  the  Supreme  Court  of  Canada,  in  the  Manitoba  appeal 
the  Chief  Justice  of  Canada  dissented  and  would  have  re- 
versed. For  he  took  the  same  view  as  Perdue,  J.  A.,  had 
expressed  in  the  Court  below.  He  thought  that  the  Mani- 
toba Act,  if  valid,  would  deprive  the  Dominion  companies 
of  their  status  and  powers,  notwithstanding  that  the  pro- 
vision in  s.  18  of  the  British  Columbia  Act  prohibiting  the 
registration  of  an  extra-Provincial  corporation  with  a 
name  of  which  the  Registrar  disapproved  did  not  occur  in 
the  Manitoba  Act.  But  while  he  formed  this  opinion  about 
the  Manitoba  Act  he  thought  otherwise  about  that  of  Sas- 
katchewan, which  he  held  had  been  so  framed  as  to  get 
over  the  difficulties  indicated  in  the  decision  in  the  John 
Deere  Plow  Case.  (1)  His  view  was  that  in  the  latter 
Act  the  provisions  were  confined  to  the  levying  of  direct 
taxation,  and  that  its  construction  was  such  that  if  a  Do- 
minion company  paid  the  tax  it  could  carry  on  business 
without  taking  out  a  license.  But  while  arriving  at  this 
conclusion  he  stated  that  he  had  done  so  with  difficulty  and 
doubt,  and  that  he  considered  the  statute  objectionable  in 
form,   though   not  in  essence. 

The  Questions  At  Issue 

Continuing  their  judgment,  their  Lordships  say: 
"It  (divergence  of  opinion  in  the  Courts  below)  has 
arisen  over  the  single  question  which  is  the  crucial  one  in 
these  appeals.  Can  the  relevant  provisions  of  all  or  any 
of  the  three  sets  of  Provincial  statutes  be  justified  as  direct- 
ed exclusively  to  the  attainment  of  an  object  of  legislation 
assigned  by  s.  92  to  the  Legislatures,  such  as  is  the  collec- 
tion of  direct  taxes  tor  Provincial  purposes;  or  do  these 
provisions  interfere  with  such  powers  as  are  conferred  on 


January   6,    1922. 


THE       MONETARY       TIMES 


233 


BRITISH  COLUMBIA 

VAST  RESOURCES  OF  CANADA'S 
PACIFIC    COAST    PROVINCE 


THE  Province  of  British  Columbia  has  an  area 
of  355,855  square  miles.  The  population  in 
1921  was  J5(J.l)()U.  There  is  estimated  to  be 
about  50,000,001)  acres  of  prime  agricultural  lands 
open  for  settlement  in  the  Province,  and  plans  tor 
an  aggressive  policy  of  immigration  from  the  old 
country  are  now  being  perfected. 
FINANCK 

Under  the  present  administration  the  credit  of 
the  Province  has  been  restored,  and  its  finances 
rest  upon  a  solid  basis.  The  ordinary  expenditures 
are  being  Itept  within  revenue,  and  borrowing  is 
only  resorted  to  for  necessary  capital  expenditure 
of  a  reproductive  nature. 

The  Public  Accounts  for  the  fiscal  year  ended 
March   31st,   1912,  show  the  following  results: 

Revenue       (Current    Account)       $15,219,26 1.S2 

Expenditure      (Current   Account)    15,236,931.35 

Expenditure       (Capital    Account)       4,389,749.60 

The  total  assets  of  the  Province  exceed  its  total 
liabilities  by  $26,408,911,  an  increase  of  $3,001,- 
219  over  the  previous  year.  These  assets  do  not 
include  the  natural  resources  of  the  Province,  the 
value  of  which  has  never  been  completely 
computed. 

AGRICUIiTURE 

Agricultural  production  continues  to  increase 
substantially,  the  value  of  all  farm  products  In 
1920  being  $69,004,953,  or  an  increase  of  37% 
over  the  production  of  1918. 

The  live-stock  statistics  show  a  value  of 
$14,014,873,  meats  of  all  kinds  a  value  of 
$1,217,212,  dairy  products  generally  a  value  of 
$6,966,757.  Poultry  and  eggs  Increased  In  pro- 
duction by  $316,899. 

The  total  vegetable  crop  was  valued  at 
$8,898,819,  and  fodder  crops  at  $17,410,852. 
The  potato  crop  was  a  heavy  one  and  was  shipped 
largely  to  the  Prairies,  Eastern  Canada  and  the 
rnitiMl    Slates. 

FrSHEKlRS 

.\s  in  former  years  the  catch  of  the  British  Col- 
umbia fisheries  has  led  the  Dominion.  The  value 
of  the  catoh  in  1920  was  $12,612,773,  or  48% 
of  the  total  of  the  sea  fisheries  of  Canada.  Im- 
mense quantities  of  halibut  are  shipped  to  the 
markets  of  the  Atlantic  coast.  The  whaling  In- 
dustry off  the  West  coast  of  Vancouver  Island  and 
off  the  Queen  Charlotte  Islands  is  very  prosperous. 


INDUSTRIAL 

Britiah  Columbia  offers  a  splendid  opportunity 
to  all  manufacturers,  having  illimitable  supplies 
of  all  raw  materials  and  transportation  facilities 
by  land  and  sea.  There  are  large  bodies  of  Iron 
ore,  and  the  known  deposits  of  coal  aggregate 
88,828,523,000    tons. 

There  is  abundance  of  water  power  develop- 
ment, complete  or  under  way,  amounting  to 
453,185  h.p.  In  addition  powers  to  an  estimated 
total  of  941,935  h.p.  have  been  staked,  and  there 
is  over  1,000,000  h.p.  more  which  baa  been  com- 
puted by  the  Water  Branch. 

The  proposals  for  the  establishment  of  steel 
mills  and  steel  shipbuilding  plants  are  progressing 
satisfactorily. 

LU.>IBER 

The  timber  lands  of  the  Province,  according  to 
the  records,  contain  349,568,000.000  board  feet  of 
saw  material,  and  in  addition  there  is  a  vast 
amount  of  pulp  wood  material.  In  the  Queen 
Charlotte  Islands  alone  there  is  a  stand  of  twenty- 
three  billion  feet  of  sitka  spruce.  Modern 
methods  of  forest  protection  and  reforestation 
render  these  resources  inexhaustible.  Forest 
production  in  1920,  iiiCiadmg  paper  and  pulp,  was 
valued  at  $92,628,807,  an  increase  of  over 
$22,000,000  over  the  previous  year. 

MIXIXO 

The  mineral  output  for  1920  was  valued  at 
$35,550,625,  an  increase  of  more  than  two  and 
one-quarter  millions  over  the  year  before. 

The  production  of  silver  and  copper  increased, 
but,  owing  to  lower  prices,  the  value  showed  a  re- 
duction. On  the  other  hand,  while  the  production 
of  lead  showed  a  falling  off,  there  was  an  increase 
in   value   through   Improved   market  conditions. 

One  of  the  most  noteworthy  features  in  connec 
tion   with   the   mining  activity   is  the  development 
of  the  zinc  industry.     Another  satisfactory  f<M'  , 
is  the  increased  productivity  of  the  coUleries.  l^ll. 
amount  mined  in   1920    being    iO%  in    excess    of 
1919. 

Much  prospecting  and  development  is  in  progress 
under  the  Mineral  Survey  and  Development  Act, 
and  the  Department  of  Mines  is  carrying  on 
diamond  drilling  to  ascertain  the  tonnage  of  sev- 
eral    iron    deposits. 


For  any  particulars  address 


BUREAU   OF   INFORMATION. 

Parliament  Buildings, 

Victoria,  B.  C. 


OR 


HON.  JOHN  HART. 
Minister  of  Finance. 
Victoria.  B.  C. 


234 


THE      MONETARY      TIMES 


Volume    68 


a  Dominion  company  by  the  Parliament  of  Canada  to  car- 
ry on  its  business  anywhere  in  the  Dominion,  and  so  affect 
its  status? 

Powers  Under  B.  N.  A.  Act 
The  question  is  one  primarily  of  the   interpretation  of 
the  British  North  America  Act  and  in  the  second  place  of 
the   meaning    of   the   principle   already   laid   down   by   this 
Committee  in  the  John  Deere  Plow  Case.      (1)     The  consti- 
tution of  Canada  is  so  framed  by  the  British  North  America 
Act  that  the  difficulty  was  almost  certain  to  arise.     For  the 
power  of  a  Province  to  legislate  for  the  incorporation     of 
companies  is  limited  to  companies  with  Provincial  objects, 
and   there    is   no    express    power    conferred    to    incorporate 
companies   with  powers  to   carry   on   business     throughout 
the  Dominion  and  in  every  Province.     But  such  a     power 
is  covered  by  the  general  enabling  words  of  s.   91,  which, 
because  of  the  gap,  confer  it  exclusively  on  the  Dominion. 
It  must  now  be  taken  as  established  that  s.  91  ena'bles  the 
Parliament  of  Canada  to  incorporate  companies  with  such 
status  and  powers  as  to  restrict  the  Provinces  from  inter* 
fering  with  the  general  right  of  such   companies  to  carry 
on  their  business  where  they  choose,  and  that     the  effect 
of  the  concluding  words  of  s.  91  is  to  make  the  exercise  of 
this   capacity  of  the  Dominion   Parliament   prevail   in   case 
of  conflict  over  the  exercise  by  the  Provincial  legislatures 
of  their  capacities   under   the  enumerated   heads   of  s.   92. 
It  Is  clear  that  the  mere  power  of  direct  taxation  is  saved 
to  the  Province,  for  that  power  is  specifically  given  and  is 
to  be  taken,  so  far  as  necessary,  on  a  proper  construction 
to  be  an  exception  from  the  general  language  of  s.  91,  as 
was   explained   by   Sir   Montague   Smith   in   delivering      the 
judgment  of  the  Judicial  Committee  in  Citizens  Insurance 
Co.  V.  Parsons.      (1)     Nevertheless,  the  methods  by  which 
the  direct  taxation  is  to  be  enforced  may  be  restricted  to 
the  bringing  of  an  action,  with  the  usual  consequence,  which 
was  all  that  was  decided  to  be  legal  in  Bank  of  Toronto  v. 
Lambe.      (2)     It  does  not  follow  that  because  the  Govern- 
ment of  tho  Province  can  tax  it  can  put  an  end  to  the  ex- 
istence or  even  the  powers  of  the  company  it  taxes  for  non- 
compliance with  the  demands  of  the  tax-gatherer. 
The  Ontario  Mortmain  Act 
The   principle   of   interpretation    to    be   followed   In   ap- 
plying the  test  laid  down  in  the  John  Deere  Plow  Co.  Case 
that  Provincial  legislation  cannot  validly  destroy  the  status 
and  powers  conferred  on  a  Dominion  company  by  Act  of  the 
Parliament  of  Canada,  does  not  appear  to  be  o'bscure  when 
read  in  the  light  turning  to  its  application,  the  first  thing  to 
be  observed  is  the  nature  of  the  questions  to  be  answered. 
Their  Lordships  will   dispose   in  the  first  place  of  a     sub- 
sidiary matter,  which  is  whether  a  Dominion  company  can 
be  precluded  from  acquiring  and  holding   land  in  a  prov- 
ince by  a  Provincial  law  of  the  nature  of  a  general  Mort- 
main Act.     It  is  clear,  both  on  principle  and  from  previous 
decisions,  that  it  is  within  the  competence  of  a  Provincial 
Legislature   to   enact  such   legislation,   and  the  question   is 
therefore  answered  in  the  affirmative.     If  there  be  a  pro- 
vision to  this  effect,  occurring  even  in  a  statute  which   in 
other  respects  is  ultra  vires,  and   that  provision  be  sever- 
able, it  is  valid.     In  the  Ontario  case  there  is  therefore  no 
doubt  that  the  broad  result  of  the  contention  of  the  Prov- 
ince under  the  head  is  well  founded;   for  there  the  Legis- 
lature  has  passed  a  Mortmain  Act  of  general  application, 
and  in  regard   to   this  Act  a  Dominion   company   is   in   no 
better  position  than  any  other  corporation  which  desires  to 
hold  land. 

Power  To  Hold  Hand  in  Manitoba 
In  Manitoba  there  Is  no  general  Mortmain  Act,  but  as 
112  of  the  Manitoba  Companies  Act  enables  a  corporation 
receiving  a  license  under  Part  IV.  of  the  Act,  relating  to 
extra-Provincial  companies,  to  acquire  and  hold  land  as 
freely  as  could  any  company  under  Part  I.  of  the  Act.  Even 
if  the  provision  as  to  the  licensing  of  extra-Provincial  com- 
panies is  held  to  be  ultra  vires,  so  as  to  preveat  such  a 
provision  from  being  operative,  as  being  inseverable,  it  is 
plain  that  the  substance  of  a  provision  which  is  of  the  char- 
acter of  a  mortmain  law  is  within  the  power  of  the  Prov- 
ince. 


Power  To  Hold  Land  in  Saskatchewan 

In  Saskatchewan  there  is  no  general  Mortmain  Act,  but 
the  Companies  Act  of  1915,  by  s.  19,  enables  a  company  in- 
corporated under  the  law  of  the  Province  to  hold  land.  By 
s.  25  a  company  not  so  incorporated  (and  this  includes  a 
Dominion  company)  may,  if  it  has  been  licensed,  carry 
on  its  business  as  if  it  had  been  incorporated  under  the 
law  of  the  Province.  This  enables  it  to  hold  land  unless 
the  provisions  as  to  the  grant  to  it  of  a  license  are  inopera- 
tive. Their  Lordships  do  not  think  that  s.  29  of  the  Com- 
panies Act  of  Canada,  which  purports  to  enable  a  Domin- 
ion company  to  acquire  and  hold  real  estate  requisite  for 
the  carrying  on  of  its  undertaking,  can  prevail  against  an^ 
severable  provision  by  a  Provincial  Legislature  restricting 
the  power  of  corporations  generally  to  acquire  or  hold  real 
estate  in  the  Province.  ' 

The  Main  Question 

Their  Lordships  then  dealt  with  the  main  question  rais- 
ed by  these  appeals,  viz:  "Had  the  Provinces  of  Ontario, 
Manitoba  and  Saskatchewan  power  to  impose  on  Dominion 
companies  the  olsligation  to  obtain  a  license  from  the  Pro- 
vincial Government  as  a  condition  of  the  exercise  in  these 
Provinces  respectively  of  the  powers  conferred  on  them  by 
the  Dominion?" 

Extra  Provincial  Corporation^  Act  of  Ontario 
"As  to  Ontario,  the  statute  impugned  is  the  Extra-Pro- 
vincial Corporations  Act  in  its  application  to  Dominion 
companies.  Their  Lordships  have  come  to  the  conclusion 
that  the  real  effect  of  this  Act.  as  expressed  or  implied  by 
its  provisions,  is  to  preclude  companies  of  this  character 
from  exercising  the  powers  of  carrying  on  business  in  On- 
tario, to  the  same  extent  as  in  other  parts  of  Canada,  unless 
they  comply  with  a  condition  sought  to  be  imposed,  that  of 
obtaining  a  license  to  do  so  from  the  Government  of  the 
Province.  By  section  7  such  companies  are  expressly  pro- 
hibited from  doing  so,  and  the  provision  in  s.  9  s.s.  2,  that 
no  limitations  or.  conditions  are  to  be  ncluded  In  such  a 
license  as  would  limit  a  Dominion  company,  for  example, 
from  carrying  on  in  the  Province  all  such  parts  of  its  biisi- 
ness,  or  from  exercising  there  all  such  parts  of  its  powers, 
as  its  Act  or  charter  of  incorporation  authorizes,  does  not 
in  their  Lordships'  opinion  sufficiently  mend  matters.  For 
t^J  assertion  remains  of  the  right  to  impose  the  obtaining 
of  a  license  as  a  condition  of  doing  anything  at  all  in  the 
Province.  By  section  11  the  grant  of  the  license  is  made 
dependent  on  compliance  with  such  regulations  as  may 
happen  to  have  been  made  by  the  Lieutenant-Governor  in 
Council  under  sections  2  and  10  of  the  Act.  By  section  16 
and  also  under  section  7  itself  an  extra-Provincial  corpora- 
tion required  to  take  out  a  license  is  to  be  fined  for  not  do- 
ing so,  and,  under  section  16,  is  to  be  incapable  of  suing 
in  the  Courts  of  the  Province.  Their  Lordships  are  of  opin- 
ion that  these  provisions  cannot  be  regarded  as  confined 
only  to  such  limited  purposes  as  would  be  legitimate,  and 
that  they  are  therefore  ultra  vires. 

E.vtra  Provincial  Corporations  Act  of  Manitoba 
Taking  next  the  Companies  Act  of  Manitoba,  Part  IV.  of 
this  Act  deals  with  extra-Provincial  corporations,  including 
Dominion  companies.  The  effect  of  the  scheme  of  this  part 
does  not  appear  to  their  Lordships  to  differ  in  any  feature 
that  is  material  from  that  of  the  Ontario  Act.  Inter  alia, 
a  Dominion  company  must  take  out  a  license,  which  it  is 
entitled  to  receive  if  it  complies  with  the  provisions  of  the 
— ct  and  with  regulations  to  be  made  by  the  Lieutenant- 
Governor  in  Council.  There  may,  under  s.  Ill,  be  limita- 
tions and  conditions  specified  in  the  license,  and  if  the  com- 
pany makes  default  in  complying  with  these  or  certain  oth- 
er provisions,  the  license  may  be  revoked  under  s.  121. 
Unless  the  company  obtains  a  license  it  cannot,  nor  can  any 
of  its  agents,  carry  on  business  in  Manitoba.  Penalties  are 
imposed  for  carrying  on  business  without  a  license,  and  so 
long  as  unlicensed  the  company  cannot  invoke  the  juris- 
diction of  the  Courts  of  the  Province.  It  does  not  alter  the 
scope  of  these  provisions  that  by  s.  126  fees  are  payable 
for  the  license,  to  be  applied  to  the  benefit  of  the  revenue 
of  the   Province. 


January  6,   1922. 


THE      MONETARY      TIMES 


235 


QiEAP  IlyDBO  Electric  Power 


VANCOUVER  and  the  Pacific  Coast  of  British  Columbia 
have  unequalled  Electric  Power  resources  for  manu- 
facturing purposes.  Our  Lake  Buntzen  and  Stave 
Lake  plants  develop  136,000  horse-power,  with  an  additional 
225,000  horse-power  available  for  immediate  development. 
Our  rates  can  compare  with  any  city  on  the  coast.  Water- 
frontage  and  proximity  to  raw  materials  and  markets  make 
Vancouver  the  logical  place  to  locate  your  factory. 

Gas  is  supplied  in  Vancouver  to  manufacturers  at  rates  as 
low  as  70  cents  per  1,000  cubic  feet. 

Victoria,  Vancouver  Island,  has  27,000  horse-power  of  electri- 
cal energy  for  industries.    Gas  also  supplied  at  low  rates. 


Write  for  full  particulars,  rates,  etc.,  to 

GEORGE  KIDD,   General  Manager  -  VANCOUVER,   B.C. 


British  Columbia  Electric  Railway  Company,  Ltd. 

Victoria  North  Vancouver  New  Westminister  Vancouver 


236 


THE      MONETARY      TIMES 


Volume     68 


Tlieir  Lordships  are  unable  to  take  the  view  that  these 
sections  regarded  together  are  directed  solely  to  the  pur- 
poses specified  in  s.  92.  They  interpret  them,  like  those  of 
the  Ontario  statute,  as  designed  to  subject  generally  to  con- 
ditions the  activity  within  the  Province  of  companies  incor- 
porated under  the  Act  of  the  Parliament  of  Canada.  The 
restriction  in  this  statute  as  to  the  holding  of  land  cannot 
be  severed  from  the  general  provisions  as  to  licensing  so 
as  to  make  those  restrictions  enforceable  as  being  in  the 
nature  of  Mortmain  legislation. 

Extra  Provincial  Corporations  Act  of  Saskatchewan 

The  statute  remaining  to  be  considered  is  that  passed 
by  the  Legislature  of  Saskatchewan  in  1915,  a  general 
Companies  Act  which,  however,  contains  provisions  applic- 
able to  Dominion  companies.  By  s.  23,  if  such  companies 
carry  on  business  in  Saskatchewan,  they  must  be  registered 
under  this  Act,  and  if  they  carry  on  business  without  reg- 
istering, the  companies,  and  also  the  agents  acting  for  them, 
are  made  liable  on  summary  conviction  to"  penalties.     By  s. 

24  such  companies  are  entitled  to  be  registered  on  comply- 
ing with  the  provisions  of  the  Act  and  on  paying  the  pres- 
cribed  fees.      There   are   also   payable  annual   fees.      By  s. 

25  such  companies  may  upon  certain  conditions  receive  a 
license  to  carry  on  business  in  Saskatchewan,  and  if  they 
carry  on  business  without  a  license  are  guilty  of  an  offence 
and  liable  to  penalties.  By  s.  29,  where  the  Registrar  sat- 
isfies himself  in  the  prescribed  manner  that  a  company  re- 
gistered under  the  Act  has  ceased  to  carry  on  business,  he 
may  strike  the  company  off  the  register,  and  it  is  then  to- 
be  dissolved.  By  s.  30,  if  the  registration  fees  prescribed 
by  the  regulations  made  by  the  Lieutenant-Governor  in 
Council  be  not  paid,  the  Registrar  is  to  strike  the  company 
off  the  register. 

Here  again  their  Lordships  think  that  the  Provincial 
Legislature  has  failed  to  confine  its  legislation  to  the  oTd- 
jects  prescribed  in  s.  92,  and  has  trenched  on  what  is  ex- 
clusively given  by  the  British  North  America  Act  to  the 
Parliament  of  Canada.  If  the  Act  had  merely  required  a 
Dominion  company,  within  a  reasonable  time  after  commen- 
cing to  carry  on  business  in  Saskatchewan,  to  register  its 
name,  and  other  particulars  in  the  Provincial  register  and 
to  pay  fees  not  exceeding  those  payable  by  Provincial  com- 
panies, and  had  imposed  upon  it  a  daily  penalty  for  not 
complying  with  this  obligation,  it  could    (their     Lordships 


chink)  be  supported  as  legitimate  machinery  for  obtaining 
information  and  levying  a  tax.  But  the  effect  of  imposing 
upon  such  a  company  a  penalty  for  carrying  on  business 
while  unregistereid  is  to  make  it  impossible  for  the  company 
to  enter  into  or  to  enforce  its  ordinary  business  engage- 
ments and  contracts  until  registration  is  effected,  and  so 
to  destroy  for  the  time  being  the  status  and  powers  con- 
ferred upon  it  by  the  Dominion.  Further,  if  it  is  the  in- 
tention and  effect  of  the  Act  that  a  Dominion  company 
when  registered  in  the  Province  shall  be  subject  (by  virtue 
of  the  definition  section  or  otherwise)  to  the  general  pro- 
visions of  the  Saskatchewan  Companies  Act  or  shall  'become 
liable  to  dissolution  under  s.  29,  the  Act  would  open  to 
question  on  that  ground;  but  it  is  right  to  say  that  such  a 
construction  was  disclaimed  by  counsel  for  the  Attorney- 
General  of  Saskatchewan  and  (as  regards  the  liability  to 
dissolution)  has  been  excluded  by  an  amending  Act  passed 
while  these  proceedings  were  pending  section  25  of  the 
Saskatchewan  Act,  which  requires  a  Dominion  company  to 
obtain  a  license,  stands  on  the  same  footing  as  the  enact- 
ments in  Ontario  and  Manitoba  which  have  been  held  void 
as  ultra  vires;  and  in  this  case  also  the  restrictions  on  the 
holding  of  land  are  not  severable  from  the  licensing  pro- 
visions and  are  invalid  on  that  ground. 
Summary 
The  proper  course  will  be  to  allow  the  appeals  and  to 
declare:  (1)  That  in  the  case  of  all  four  appellant  com- 
panies the  provisions  of  the  parts  of  the  Provincial  Com- 
panies Acts  which  were  the  subject  of  the  proceedings  in 
the  Courts  of  the  Provisions  of  Ontario,  Manitoba  and  Sas- 
katchewan, in  so  far  as  they  purport  to  apply  to  the  appel- 
lant companies  respectively,  are  ultra  vires  of  the  Provin- 
cial Legislatures  in  each  case  and  that  these  companies 
are  not  precluded  by  reason  of  not  having  been  licensed  or 
registered  under  those  Acts  from  carrying  on  business  and 
exercising  their  powers  in  the  three  Provinces,  and  are  not 
liable  to  the  penalties  prescribed  for  having  so  carried  on 
business  and  expressing  their  powers.  (2)  That  in  the  case 
of  the  Province  of  Ontario,  none  of  the  appellant  compan- 
ies can  acquire  and  hold  lands  in  the  Province,  without  a 
license  under  the  Provincial  Mortmain  Act  and  that  it  is 
within  the  power  of  the  other  Provincial  Legislatures  to 
impose  the  requirement  of  a  license  directed  to  this  pur- 
pose. The  judgments  of  Masten,  J.,  in  the  Ontario  cases 
will  be  restored  and  the  other  proceedings  dismissed." 


Legal  Decisions  Affecting  Industrial  Companies 

Marks  vs.  The  Rocsand  Co.,  Ltd. — National  Trust  Co. 
vs.  Gilbart — Welland  Hotel  vs.  City  of  Montreal — 
Winding-up     a    Company    Under    the     Dominion     Act 


The  four  cases  reviewed  herein  are  concerned  chiefly 
with  matters  of  interest  to  manager  of  companies — the 
notable  case  of  the  year  on  this  subject,  that  of  Great 
West  Saddlery  Co.  v.  the  King  having  been  dealt  with  sep- 
arately because  of  its  extreme  importance,  not  only  in 
Corporation  Law  but  also  in  Constitutional  Law. 

A    Company's    Difficulties 

In  the  first  case,  that  of  Marks  v.  The  Rocsand  Co.  Ltd., 
the  defendant  company  was  incorporated  on  the  24th  June 
1914,  as  a  private  company  under  the  Ontario  Companies 
Act  with  an  authorized  capital  stock  of  $100,000,  with  five 
provisional  directors  and  head  office  at  Hamilton.  All 
the  capital,  consisting  of  1,000  shares,  was  issued  and 
fully  paid  up. 

In  1917  and  the  early  part  of  1918  the  company  was 
in  a  bad  way  and  was  involved  financially.  At  a  meeting 
of  shareholders,  held  on  the  28th  May,  1918,  the  plaintiff, 
who  then  held  100  shares,  submitted  a  proposition  to  pur- 
chase 51  per  cent  of  the  stock  and  to  advance  certain 
moneys  to  the  company.     This  proposition  resulted  in  the 


plaintiff  and  Mr.  H.  N.  Kittson,  one  of  the  original  incorp- 
orators, and  already  a  holder  of  280  shares,  together  ad- 
vancing certain  moneys  and  acquiring  certain  additional 
shares,  so  that  by  the  12th  June,  1918,  the  plaintiff  had 
260  shares  and  Kittson  387,  making  647  in  all  out  of  the 
1,000  issued  shares,  thereby  giving  the  plaintiff  and  Kittson 
control. 

The  plaintiff  says  that  there  was  an  arrangement  made 
with  Kittson  whereby  the  plaintiff  was  to  become  general 
manager  of  the  company,  and  that  he  and  Kittson,  were 
to  be  remunerated  for  their  services.  The  plaintiff  says 
he  wrote  to  Kittson  in  July,  1918,  stating  that  he  (the 
plaintiff)  was  to  draw  $200  per  month  as  salary,  and  that 
Kitson  was  to  receive  $50  per  month  for  his  services  in 
looking  after  the  business  at  Hamilton. 

It  is  admitted  that  there  was,  at  that  time,  no  meeting 
of  directors,  formal  or  otherwise,  at  which  the  plaintiff 
was  authorized  to  act  as  manager  or  In  any  other  capacity, 
but  there  is  no  doubt  about  the  fact  that  from  about  the 
middle  of  June,  1918,  onwards,  Marks  looked  after  the 
business  of  the  company  from  its  Toronto  office,  Bady,  the 
secretary-treasurer,  being  engaged  at  the  plant  at  Erin. 


January  6,  1922. 


THE      MONETARY      TIMES 


237 


EDMONTON 

THE  CAPITAL  CITY  OF  ALBERTA 

In  the   Most  Strategic 
Location  in  the  West 

Gateway  to  the  Great  Peace  River  Country  and  the  Mackenzie  Basin, 

with  Oil,  Tar,  Salt  and  other  Minerals,  in  addition  to 

Vast  Grazing  and  Agricultural  Areas. 

Edmonton  is  an  important  Industrial,  Agricultural  and  Distributing  Point,  with  three  Transcontinental  Rail- 
roads: the  C.P.R.;  the  C.N.R.,  and  the  G.T.P.,  besides  the  K.D.  and  B.C.  and  Alberta  and  Great  Waterways  and 
other  branch  lines. 

Edmonton  manufactures  goods  of  every  description.  The  City  is  underlaid  with  an  unlimited  supply  of 
Lignite  Coal,  ensuring  absolute  freedom  from  fuel  shortage.  The  surrounding  district  includes  some  of  the  most 
productive  mixed  farming  lands  In  the  West. 

The  City  owns  and  operates  Electric  I.,ight  and  Power  Plant,  Street  Railway,  Telephone  and  Waterworka 
Utilities,  and,  as   the  statement  below  indicates,   they   are   earning   substantial   surpluses. 


SUMMARY  OF  NET   FUNIMI)   liEDT  AS  AT  31st  October,  1921. 

tiross  FuntlRtl  Debt IJ-.;7,000.7I6.81 

Deduct: 

(1)  Local  Impls.  Debens.    (Property  Share)    4,449,690.71 

(2)  Utilities 10,923,057.56 

»  

15,372,748.87 

(3)  Sink.    Fund    Iiivcsl.    of   $6,323,988.81    on 

Gross  Funded  Debt,  less  Sink.  Fund 
of  »3,886,613.15  on  foregolnif  S|)cclany 
rated  and  Revenue  Producing:  Debt..    2,437,375.66 

17,810,123.93 

Net  Debenture  Debt »I0,140,592.91 

SINKINCi    FUND    INVESTMENTS. 

Amount.  % 

Dominion   of  Canada    Bonds    618,773.04  S.84 

Bonds  Guaranteed  by  Dominion  4,034.97  .06 

Bonds  of,  and  Securities  guaranteed  by,  Pro- 

vlnii^s  of  Canada   406,768.44  6.47 

Debens.    of    Munlcip.    &    School    Districts    In 

Canada     672,2.'i9.31  10.69 

City  of  Edmonton  Debns.  bought  In  Market..  l,s»l, 172.97  20.58 

City  of  Edmonton  Short  Term  Debentures 101,377.29  1.61 

Clly  or  Edmonton  Debns.  bouKht  froin  City  ..  401,685.64  6.39 

3,499,071.66 

Ciisli  nil   11,-ind    and    In   Hank    •.••.ni.-.'i).'*.  17  3.6,'i 

3,738,280.13 

First  Mortgage  over  Real  Estate  i,(H>4, 130.51  17. S» 

Real  Estate  acquired   (Less.  Deprecn.)   69,738.20  1.11 

4,892,148.84 

Interest   Due   and   Accrued    ;i(i2,7ri:..:ti'>  4.81 

Bills    Receivable     .". I,094,txl8.64  17.4 

(•i.2!<9.5l-.'.8( 
Less  Accounts  Payable   1,390. 7S 

Total    Fund    (31st  Dec,   1930)    »6,288,I23.00         100. 


PUBlilC   UTILITIES— RESULTS  OF  OPERATION  FOR  TEN  MOIfTHS 
ENDING  31st  October,  ItSO-ltSl. 
Surpluses.  ton.  iW. 

Electric   Light 23.364.78  luO.036.59 

Power  House  (Inc.  Pump  Plant)   .i:t.'v)7.;9 

Telephone 47,558.01  63,544.22 

Waterworks     3,989.28  «,«()1.16 

«»»,IB9.i6 
SLSM-OS 


♦75,419.01 
Less  Dencit: 

Street  Ballway 154,617.76 

Power  House  (Inc.  Pump  Plant) S8,S77.15 

I1923M-91 


Net  Surplus 
Net  Dennt  . 


|5t.»6.03 
|I74,743.U 


.1117.182.90 


SPKCIAL    K!.>A.m:1AL   FEATURES. 

Depreciation  Reserves  amount  to  f    MB.IM.St 

Special  Reserve  against  Uncollectible  Taxes  ifiHOfiSt.M 

Sinking  Fund  Requirements  fully  Provided  for  aknB.ltt.06 

Collection   of  Current  Tax   Levy   (19S0)    73.101ft 

Total    Tax    Colleciions    (incL    of   Arrears    k    Discount 

allowed  on  Current)   1920  4,«B,*00.« 

Bank  Loan  on  Current  Account  Slst  Oct  10S1   58S.JOS.OI 

Net  AssessiTient  on  Land    (I92I1    «1,M7,S80.00 

Improvements      —   l8,8e».4flB.0O 

in,>».sss.oo 


Building  Permits  (tan),  10  Months 
Building  Permits   (IBiO),  Year 

City's  Assets   


.     I.$(>.000.00 
.111,000,000.00 


Tax  Rate    (1021) 


General 
School 


Pvb.  S.  Sep.  s. 
.  M.n  M.as 
.   is.cs      u.$» 

S0.W       3B.S0 


Population,  60,000. 

Area  of  City  J7,SO0  Acres. 


D.  M.  DUOGAN, 
MAYOR. 


C.  i.  YORATH. 

COMMISSIONER. 


238 


THE      MONETARY      TIMES 


Volume    68 


On  the  9th  of  September,  1918,  a  meeting  of  share- 
holders which  is  styled  the  "Annual  General  Meeting"  was 
held. 

No  mention  is  made  of  the  plaintiff's  position  as  man- 
ager or  of  any  salary  to  him.  The  plaintiff  continued,  how- 
ever, to  perform  the  duties  which  he  had  entered  upon  In 
June,  and  Mr.  Kittson  admits  that  from  that  time  he  re- 
garded the  plaintiff  as  the  "managing  director"  of  the 
company.  As  he  put  it,  the  plaintiff  was  the  director  who 
managed  the  company. 

The  company's  business  was  not  improving  and  in 
October,  1918,  Marks  wrote  Kittson  asking  him  to  call  a 
shareholders  meeting.  This  was  not  done,  so  Marks  called 
ihe  meeting,  signing  the  notices  as  "manager." 

There  was  some  question  as  to  ihe  regularity  of  this 
Tneetmg.  The  plaintiff  had  no  authority,  as  manager,  to 
-call  a  meeting  of  shareholders.  Nor  did  the  president's 
failure  or  refusal  to  call  a  meeting  justify  the  plaintiff  in 
assuming  the  right  to  call  it.  A  special  general  meeting 
of  shareholders  can  be  called  only  upon  the  authority  of 
the  directors;  and.  although  the  plaintiff  held  a  sufficient 
number  of  shares  to  enable  him  to  exercise  his  right  to 
have  a  meeting  called  under  sec.  46  of  the  Ontario  Com- 
panies Act,  he  did  not  follow  the  requirements  of  that 
section.  So  that,  unless  all  the  shareholders  were  present 
at  the  meeting,  or  were  represented  by  proxy  after  due 
notice  of  the  business  to  be  transacted,  no  resolution  passed 
thereat  could   bind   the   shareholders. 

The  Supreme  Court  of  Ontario  on  these  facts,  gave  a 
decision,  important  in  two  respects: 

(1)  The  manager  of  a  private  company  incorporated 
under  the  Ontario  Companies  Act  has  no  authority,  as 
manager,  to  call  a  meeting  of  shareholders,  and  where  a 
meeting  has  been  called  by  him  as  manager  "to  discuss 
matters  of  importance  pertaining  to  the  company's  affairs," 
unless  all  the  shareholders  are  present  at  the  meeting,  or 
are  represented  by  proxy,  after  due  notice  of  the  business 
to  be  transacted,  no  resolution  passed  thereat  can  bind  the 
shareholders.  (2)  No  by-law  of  a  company  is  necessary 
for  the  employment  of  a  director  in  some  other  capacity, 
or  for  his  remuneration  for  such  additional  services;  and 
where  the  evidence  shows  that  a  shareholder  definitely 
undertook  by  arrangement  to  manage  the  company's  af- 
fairs, and  that  he  expected  to  be  remunerated  for  his  ser- 
vices, and  that  this  was  recognized  by  nearly  all  the  other- 
shareholders,  he  is  entitled  to  be  paid  for  such  services. 

Sale    of    Company's   Assets 

The  Saskatchewan  Court  of  Appeal  In  National  Trust 
€o.  V.  Gilbart  held  that  as  the  sale  price  of  certain  lots  is 
admittedly  an  asset  of  a  company,  the  sale  price  does  not 
cease  to  be  an  asset  even  if  each  director  individually  takes 
a  portion  for  his  own  use,  when  he  or  they  have  not  re- 
ceived authority  from  the  company  to  do  so,  and,  on  an 
assignment  being  made  by  the  company,  the  property  In 
the  money  never  having  passed  out  of  the  company,  the 
assignee  is  entitled  to  sue  for  Its  return. 

The  chief  part  of  Mr.  Justice  Newland's  decision 
loUows:  "The  three  defendants  were  the  only  members 
of  the  Saskatoon  Trading  Company.  They  were  also  the 
directors  of  the  company.  The  company  owned  two  lots 
of  land  which  it  sold.  The  proceeds,  after  paying  for  the 
land,  were  divided  by  the  three  defendants  amongst  them- 
selves. No  dividend  was  declared,  they  simply  divided 
amongst  themselves  certain  assets  of  the  company.  They 
could  not,  in  my  opinion,  make  title  to  this  property  In 
that  way,  therefore  the  amount  each  one  took  out  of  the 
assets  of  the  company  would  still  be  the  property  of  the 
company,  and  each  of  the  defendants  would  hold  the 
amount  he  obtained  in  that  way  in  trust  for  the  company. 
The  company  has  since  become  insolvent  and  has  made  an 
assignment  for  the  benefit  of  creditors,  and  the  assignee 
brings  this  action  to  recover  the  amount  of  the  assets  so 
disposed  of. 

"I  think  the  assignee  has  the  right  to  recover.  The  de- 
fendants, having  no  legal  title  to  the  assets  of  the  com- 


pany which  they  divided  amongst  themselves,  have  no 
right  to  retain  the  same,  and  must  hand  the  same  over  to 
the  assignee  in  order  that  it  may  pay  the  debts  of  the 
company.  Having  had  the  use  of  this  money  for  some  time, 
they  should  pay  interest  on  the  same  at  the  legal  rate." 

Welland  Hotel   v.   Montreal  * 

In  the  case  of  Welland  Hotel  v.  City  of  Montreal  the 
Quebec  Superior  Court  dismissed  the  City's  appeal  contest- 
ing distribution  to  creditors  by  the  liquidator  of  a  company 
and  claiming  priority  for  certain  of  its  claims. 

The  liquidator  of  the  company  had  prepared  a  statement 
showing  the  distribution  to  creditors  of  the  sum  of  ?10,- 
278,  realized  by  time.  The  City  of  Montreal  contested  this 
distribution.  It  alleges  that  it  produced  a  claim  of  $666, 
for  water  rates  and  business  tax  for  the  year  1917;  t^t 
this  claim  is  privileged,  but  was  not  placed  in  its  proper 
class  of  creditors;  that  the  claim  of  the  contestant  takes 
precedence  of  the  fees  of  the  liquidators  and  inspectors 
and  all  other  expenses  of  the  insolvent  estate,  other  than 
those  necessary  for  the  inventory  and  the  sale  of  the  prop- 
erty, subject  to  the  privileged  claim  of  the  contestant  and 
for  the  distribution  of  the  proceeds  of  the  sale  of  the 
property. 

"Considering  that  this  is  a  matter  of  the  liquidation  of 
a  joint  stock  company,  and  that  such  liquidation  is  govern- 
ed by  a  Dominion  statute,  namely,  the  Winding-up  Act, 
R.S.C.  1906,  ch.  144;  that  ch.  144  contains,  in  the  matter 
of  the  liquidation  of  companies  with  capital  stock,  special 
provisions  which  the  Court  shall  apply  before  all  other 
general  laws  and  that  it  is  only  when  this  chapter  is  silent 
that  recourse  must  be  had  to  such  general  laws." 

Winding  np  Companies 

The  Supreme  Court  held  that  when  a  company  in 
Quebec  is  being  wound  up  under  the  Dominion  WInding-Up 
Act,  the  distribution  of  moneys  must  be  made  in  accordance 
with  that  Act  and  not  under  the  Civil  Code  of  Quebec,  and 
that  where  a  liquidator  has  been  duly  authorized  to  c^rry 
on  a  company's  business,  whereby  certain  assets  have  been 
realized,  the  expenses  of  the  employees,  the  fees  of  the 
liquidator  and  inspectors,  the  costs  of  the  attorneys,  the 
costs  of  the  first  seizure  and  the  rent  during  the  period 
of  liquidation,  all  have  preference  under  the  Dominion 
Winding-Up  Act  to  any  claims  by  the  City  Corporation  for 
water  rates  and  business  tax. 

In  another  case  the  Ontario  Supreme  Court  held  that 
voluntary  winding  up  does  not  constitute  insolvency. 

"The  Empire  Timber  Lumber  and  Tie  Co.,  Ltd.,  Is  In- 
corporated under  the  Ontario  Companies  Act  and  is  now  in 
process  of  winding-up  voluntarily  under  the  provisions  of 
the  Act,  in  pursuance  of  a  resolution  of  the  shareholders 
passed  on  the  3rd.  July,  1920.  The  resolution  also  ap- 
pointed Mr.  John  S.  Stewart  liquidator.  The  company  has 
a  nominal  capital  of  $85,000.  The  evidence  as  to  the 
nature  and  extent  of  the  company's  assets  and  liabilities 
is  a  little  vague,  but  it  appears  to  have  certain  sawmills 
and,  equities  in  or  options  upon  timber  lands  and  some 
lumber  on  hand,  all  valued  at  approximately  $35,000,  with 
liabilities,  secured  and  unsecured,  of  about  $30,000.  The 
petitioners,  Hall  Brothers,  Ltd.,  are  creditors  upon  an 
overdue  promissory  note  for  $591.70  and  interest.  No 
judgment  has  been  recovered  upon  this  note,  nor  has  there 
been  default  for  60  days  after  demand  made,  under  sec.  4 
of  the  Dominion  Winding-up  Act. 

"The  petitioners  make  no  allegation  of  in.solvency,  but 
rely  solely  upon  the  fact  that  they  are  creditors,  and  that 
the  company  has  passed  a  resolution  to  wind  up  voluntar- 
ily, and  ask  that  It  be  declared  that  the  company  is  a  cor- 
poration to  which  the  provisions  of  the  Winding-up  Act 
are  applicable  and  that  the  company  ought  to  be  wound 
up  under  that  Act." 

Mr.  Justice  Orde  In  his  judgment  said, 

"Now,  assuming  for  the  sake  of  argument  that,  In  the 
exercise  of  Its  power  to  legislate  upon  the  subject  of  'Bank- 
ruptcy and  Insolvency,'  under  sec.  91  (21)  of  the  British 
North  America  Act,  the  Dominion  Parliament  can  declare 
that  the  passage  of  a  resolution  to  wind  up  voluntarily  Ipso 


January  6,   1922. 


THE      MONETARY      TIMES 


239 


SASKATOON 


Premier  Educational,   Commercial  and  Industrial  Centre 

of  Saskatchewan 


Provincial 
University 


Agricultural 
College 


Normal 

School, 

Collegiate 

and 

Splendid 

Public 

Schools 


Flour 
Milling 


Farm 
Machinery 
and    other 
Manutactunng 


Wholesale 
DlstrlbuUng 
Point  for 
Canada's 
Best  Wheat 
Growing  and 
Mixed 
Farming 
Territory 


(Three  views  of  Saskutoon  a»  >cen  from  the  air) 

I'opiilallon  (t-sllinatcci).  .lO.niH) 

Net  assessmrnt   for  taxation,  $27 ,85 1,48!) 


FUNDED   DEBT 

Tola!  debentures  Issued,  In- 
cludlnR-  Public  Utllllles  and 
I.oeal    Improvements    |9,?4J,7-il.74 

Not  debenture  debt  (Public 
Utilities  and  Local  Improve- 
ments  deducted)    J,90l,70l.22 

PUBLIC  UTILITIES 

After  paylnir  all  operailnsc  costs.  Including 
Interest.  Sinking  Fund  and  depreciation, 
the  net  prollt  or  loss  on  the  Cli.v's  three 
utilities  for  10  months  ending-  October  3lst. 
19SI,  was  as  follows:— 
Kleclric    Light    and    Power    Plant. 

profit     $43,701.47 

Waterworks,  pront   . .  .    16.095.41 

s:,'i  7',)r,  '^^ 
Street  llallwa.v,  loss  i    ii   :: 

Net  prolll   in.3.-)i),ll 

The   estimated   profit  on    the   I'tilllles   for 
vear  emilns-  necember  31st.  ioii.  Is  ?70.n<io. 


On  June  19th.  tWI.  the  Street  Railway  was 
pui  \inder  one-man  operation,  and  since 
then  has  actually  made  a  profit,  the  above 
loss  havlnir  been  Incurred  In  the  early  part 
of  the  year  before  adoption  of  the  one-man 
system  of  operating. 

I'l  III.H:  utility  DEBENTURE  DEBTS 
SinklnK- 
Gross  Fund  Net 

Llecl.    l.lithl 

and    Power. *I,72I.9I?.I0  K48.563.S0  »1,472.f.is  i.i 
Waterworks     854,930.05     I37.5SI.12       7t5,3iS  lU 
Street   Rail- 
way   .,...      851,035.90    100,ft50.U       7S0.SSS.7S 

Totals    . .  .»3.4?5. 178.05  »4.V..795.06  »9.938.3S?.99 
SINKING  FUND,  OCTOBEB  S1ST.  1921 
.Assets 

r.ash   In   Hank   »50.-.;i'.'.Sl 

lialancc  due  from   1930  levy sO,r>S9.57 

Profiorllon    of    1931     levy    accrued 

due    »140,171.« 

l.KSS  deposited   on  acc't  89.tXXl.00     51,171.40 


li.-.    - -       .ill     Bonds,     chieflv 

Dominion  &  Provincial  Govt)    1.875,1  «)7'i 
Ai crucd    Int.    on   Investments J7,3":.  :!> 

Ltuhllillcs 
Amount     required     In     fund     at 
aniHversary    of    Issue    dale    of 

debentures     fl.8P?.8^.SS 

\' -':.■'■     lit.   from  Mid  dales  to 
'"I.     'I>t.     im J3,079.S5 

•i.a».»«o.ia 
Insialmeois  deposited  In  advance  »<.a».'  >- 
I'mniums  on  debennires  Issued  tS.9M.00 
Surplus    earnings    &4.7li.«6 

«I.0S4.SJ«.» 
Mlv's     loUI     assets.     nr<-.     51st, 

«M     ttUIUSUS 

Hank     ln«n.    Orlober    SIst.    ISM     KBJMlM 

Drprprialinn    Reserve    KCC.97I  a* 


A.  MarG.  Yonng,  Mayor 


Andrew  Leslie,  City  Commlsiiionrr 


240 


THE       MONETARY       TIMES 


Volume    68 


facto  makes  the  company  insolvent,  I  am  unable  to  see  how 
or  where  in  the  Winding-up  Act  it  has  so  declared.  Among 
all  the  different  conditions  which  the  Act,  by  sec.  3,  de- 
clares shall  be  deemed  to  be  insolvency,  the  voluntary 
winding-up  ot  the  company  is  not  mentioned.  On  the  con- 
trary, sec.  6  makes  the  Act  applicable  in  two  classes  of 
cases:  (a)  when  the  company  is  insolvent;  and  (b)  when 
It  is  in  liquidation  or  in  process  o£  being  wound  up — show- 
ing that  there  may  be  cases  of  liquidation  or  winding-up 
which  do  not  necessarily  constitute  insolvency.  With  all 
due  respect  to  the,  decision  in  the  Manitoba  case,  I  am 
utterly  unable  to  follow  the  reasoning  which  leads  to  fhe 


conclusion  that,  because  the  Dominion  Parliament  has 
power  to  declare  what  shall  constitute  Insolvency,  the 
Winding-up  Act  has  in  effect  declared  that  a  voluntary 
liquidation  or  winding-up  is  'a  species  of  insolvency.'  In 
my  judgment,  the  Dominion  Act  has  done  no  such  thing. 
If  it  has  declared  anything  at  all  in  this  respect,  it  is  that 
a  voluntary  liquidation  or  winding-up  may  not  involve  in- 
solvency at  all.  In  my  judgment,  the  mere  fact  that  a 
pr  vincial  company  is  in  process  of  voluntary  winding-up 
does  not  of  itself  make  the  company  insolvent  under  the 
Dominion  Act." 


Developments  in  the  Grain  Trade  in  1921 

The  Royal  Grain  Inquiry,  and  the  Objections  to  Its  Methods — 
Some  After-EfFects  of  Government  Control  of  the  Grain 
Trade — Importance  of  Business  Conditions  and  Foreign  Exchange 

(Address  by  the  Incoming  President  at  the  Annual  Meeting   of  the  Winnipeg  Grain  Exchange,  October,   1921) 


My  predecessors  have  presented  to  you  at  the  four  last 
annual  meetings  of  the  Winnipeg  Grain  Exchange  a  review 
of  conditions  in  the  grain  trade  under  government  control 
and  regulations  necessary  during  the  latter  part  of  the  war 
period  and  for  two  crop  seasons  following  the  signing  of  the 
armistice. 

When  war  time  conditions  made  this  control  necessary,  the 
grain  trade  in  a  self-sacrificing  spirit,  unselfishly  accepted 
the  dictates  of  those  directing  the  governmental  grain  mar- 
keting po'icy;  placed  also  at  their  disposal  the  various  grain 
handling  plants  and  organizations  of  the  trade,  which  were 
found  by  the  government  to  be  of  such  natural  fundamontal 
soundness  and  efHciency  that  little  if  any  alteration  in  their 
general  methods  of  grain  handling  were  made  necessary 
for  a  few  men,  (the  memhers  of,  first,  the  Board  of  Grain 
Supervisor.^,  and  second,  the  Canadian  Wheat  Board),  to 
control  and  direct  the  marketing  of  our  wheat  production 
for  three  crop  years. 

During  this  period  operating  costs  generally  both  human 
and  physical  were  advancing;  no  advances  however  of  any 
consequence,  or  increased  charges  for  grain  handling 
services  were  (made  by  or  allowed  by  the  trade. 

The  Royal  Grain  Inquiry 

While  we  have  now  completed  the  business  of  a  year  free 
from  government  control  or  regulations  with  respect  to 
wheat  marketing,  such  as  the  war  time  era  accustomed  us 
to,  the  trade  has  not  been  free  from  the  shadow  of  govern- 
ment influence;  hence,  a  retrospective  review  of  affairs  of 
paramount  interest  tc  you  during  the  past  year  brings  before 
us  the  action  of  the  Dominion  government  in  appointing  the 
Royal  Grain  Inquiry  Commission. 

It  is  not  necessary  to  describe  in  detail  the  legal  proceed- 
ings taken  by  some  of  our  individual  members  against  this 
Commission. 

As  you  are  aware,  the  grain  trade  had  no  objection  to  a 
scientific  invectigation  into  the  metliods  of  grain  marketing, 
and  the  trade  appointed  committees  to  prepare  evidence  to 
be  submitted  to  the  commission  in  justification  of  the  exist- 
ing marketing  methods,  but  the  methods  of  the  Royal  Grain 
Inquiry  Comoiisrfon  were  such  that  co-operation  between 
"•"''s;ion  and  the  trade  became  impossible. 

The  Commission,  apparently,  regarded  themselves  as  a 
substitute  for  the  Board  of  Grain  Commissioners  on  the  one 
hand  and  the  Law  Courts  on  the  other,  also  the  commission 
apparently  claimed  the  right  to  pry  into  the  details  of  the 
private  business  of  every  individual  and  firm  in  the  grain 
trade,  and  in  doing  this  they  proceeded  by  methods  which 
put  the  grain  trade  to  inconvenience  and  loss. 

As  a  result,  some  individual  firms,  applied  to  the  courts 
for  an  injunction,  and  the  injunction  was  made  permanent 
by  Mr.  Justice  Curran  of  the  King's  Bench  of  Manitoba. 


Objection  to  Methods 

It  is  important  that  you  realize  what  the  real  issue  fought 
out  in  the  courts  was.  Nobody  objected  to  a  scientific 
inquiry  into  matters  of  grain  marketing,  but  everybody 
objected  to  the  procedure  and  metho:ls  of  the  commission 
and  especially  to  their  claims  in  regard  to  private  business, 
and  not  merely  the  whole  of  the  grain  trade,  but  all  business 
men  in  Canada  ought  to  congratulate  themselves  upon  the 
fact  that  regardless  of  the  government's  attempt,  individuals 
still  may  secure  through  the  courts  those  legal  rights  with- 
out which  business  cannot  be  successfully  be  carried  on. 

Prior  to  the  war  the  grain  trade  had  been  the  subject  of 
frequent  investigation  by  federal  and  provincial  inquiry 
boards  and  committees.  We  will  not  burden  you  with  details 
as  to  these  investigations  conducted  in  1897.  1899,  1906, 
1907,  1909,  1910,  1912  and  1914.  None  of  their  findings 
were  adverse  in  nature  to  our  general  methods  and  system 
of  grain  marketing. 

The  Royal  Grain  Inquiry  Commission  sent  exhaustive 
questionaires  to  the  individual  members  of  the  trade,  to  the 
various  trade  organizations  and  to  your  exchange.  Recog- 
nizing that  the  services  of  the  Winnipeg  Grain  Exchange 
are  of  a  semi-public  nature  the  fullest  information  available 
was  compiled  and  submitted  to  the  commission  by  your 
secretary,  and  when  completed  made  a  splendid  review  of 
the  functions,  value  and  necessity  of  the  Winnipeg  Grain 
Exchange,  as  the  biggest  essential  factor  in  the  economical 
movement  and  financing  of  our  Western  grain  crops. 

Conditions  Were  Abnormal 

Many  of  you  realize  that  a  return  to  normal  open  wheat 
markets  would  not  be  easily  accomplished.  It  is  not  to  be  ex- 
pected that  during  a  year  of  distorted  financial  conditions,  err- 
atic foreign  exchange  markets  and  general  commercial  rea- 
justment,  that  departure  from  a  governmental  policy  of  wheat 
handli'ng,  which  saddled  the  consumer  or  the  producer  with 
any  losses  which  might  be  made,  would  be  accomplished 
with  safety  and  satisfaction  to  all  concerned. 

It  could  not  be  expected  that  the  findings  of  a  commission, 
if  based  upon  the  abnormal  marketing  conditions  prevalent 
during  the  past  year,  would  be  of  any  great  practical  value, 
assistance  or  benefit  to  the  producer,  the  trade  or  the  con- 
sumer. That  it  could,  under  these  conditions,  be  expected  to 
achieve  anything  of  value  we  doubt.  The  real  intent  of  this 
inquiry  may  never  be  rcknowledf^ed. 

If,  as  stated  by  the  government,  this  trade  investigation 
was  instituted  because  of  agitation  to  this  end  emanating 
from  the  producer,  perhaps  we  can  trace  at  least  a  partial 
engendering  and  festering  of  this  sentiment  to  the  British 
governmental  wheat  buying  policy.  Was  not  the  producer's 
expectation  of  high  values  for  wheat  unduly  stimulated  b-<- 
this  policy? 


January  6,  1922. 


THE      MONETARY      TIMES 


241 


THE  PROVINCE  OF  NEW  BRUNSWICK 

ONE  OF  THE  MOST  THRIFTY  AND  STABLE   OF  THE  DOMINION   OF  CANADA 


AlUJNUANT  IN  NATURAL  RESOURCES,  na 
deep  sea  and   inland;    Coal,   Gypsum,   Natural  Gas, 

Large  tracts  of  hardwood  available   to   Manu 

Water  Power  Sites  advantageously  located. 

ELECTRIC  POWER  now  being  developed  by 
same  is  assured. 

THE  LAND  OP  BIG  GAME;  thousands  of  8p 
salmon  and  trout  fishing  is  unsurpassed. 

GREAT  OPPORTUNITIES  for  persons  desirl 
transportation   facilities  adjoining. 

Many  sections  of  the  Province,  including  the 
culture. 

ONE  WEEK'S  JOURNEY  FROM  EUROPE. 
GOOD  ROADS  AND  SAFE  BRIDGES,  the  joy 
New  Brunswick. 

THE  NATURAL  SCENERY  is  likened  unto  S 
THE   WORLD-WIDE   BUSINESS   DEPRESSIO 
degree  compared  with  other  countries. 

FINANCIAL  AFFAIRS  ars  carefully  and  jud 
PROVINCIAL  SECURITIES  command  highest 


mely:     Forest  Wealth,  Agriculture,  Fiaberies,  both 

etc.,  etc. 

facturers. 


the  Government  of  the  Province;  the  success  of 
ortsmen  hunt  yearly  the  moose,  deer  and  bear.  The 
ng  valuable  farm  properties  with  railroad  and  water 

St.   John  River  Valley,  are  well  adapted  to  apple 

of    the    Motorists,    characterize    the    Highways    of 

cotland's. 

N   has   been   felt   In    this   Province   in   but   a   gmall 

icialiy  administered, 
prices  and  are  readily  absorbed  when  offered. 


For  particulars  respecting  the   Natural     Resources,  write  to  the  Minister  of    Lands    and    Mines, 

Fredericton,  N.B. 

PROVINCIAL    (AniNKT 

Hon.  W.  R.  Foster,  I'rciii lor ;  Hon.  ,1.  E.  H«tli«'i-in}j:t<iii,  Provincial  H<TiTtary-Trea.Huror;  Hdii. 
J.  I».  IJ.yrnc,  Atto;ney-(;rn<'ral;  Hon.  1*.  .1.  Vcni<:(,  .MinJHter  of  Public  Works;  Hon.  C.  W. 
RoUinsiiii,  MinistxM'  of  LandH  and  MinON;  Hon.  I).  \V.  Mcrsj-rcau,  MInigler  of  .VKrlrulturr;  H:in. 
W.  F.  R:.l)('rts,  Minister  of  Health;  Hon.  J.  K.  Michaud.  Minister  without  Portfolio;  Hon. 
I<''i-<xl   Mafjee,    Minister   without   Portfolio. 


HIGH    GRADE    COATED    BOOK    PAPERS 

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and  Mercantile 

Advertising 


TRADE 


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Ritchie  &  Ramsay  Limited, 

TORONTO 

CANADA 

Western   S<'lllnji  .\.4j<'nts: 

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Winnipeg  and  Calgary 


He  won  t  refuse 
to  listen 

when  you  get  him  on  Long  Distance. 
He  may  ig^nore  your  advertising,  letters, 
telegrams  or  even  your  travellers — but 
the  minute  Long  Distance  rings  he  will 
stop  whatever  else  he  may  be  doing, 
to  listen. 

Every   Bell  Telephone  is  a 
Long   Distance  Station. 


The  Bell  Telephone  Co. 
of  Canada 


242 


THE      MONETARY      TIMES 


Volume    68 


The  Market  in  1921 

To  follow  this  thought  we  have  to  visualize  marl<et  con- 
ditions of  the  past  twelve  months  and  review  the  situation 
in  North  American  grain  marlcets  early  in  the  summer  of 
1920,  during  which  period  the  grain  trade  and  the  various 
exchanges  in  the  United  States  were  returning  to  their 
normal  functions  and  activities,  and  when  the  balance  of 
our  1919  wheat  crops  was  being  marketed  by  the  Canadian 
Wheat  Board. 

At  that  time  buying  for  overseas  or  European  require- 
ments was  being  largely  conducted  by  various  governmental 
agencies.  Those  in  charge  of  this  work  for  Great  Britain 
made  heavy  purchases  of  the  balance  of  our  1919  crop  and 
of  American  new  crop  wheat.  This  procedure  apparently 
created  an  unduly  high  artificial  level  of  prices  during  the 
early  summer  and  the  action  of  the  British  Wheat  Commission 
in  discontinuing  v.heat  purchases  late  in  July,  1920,  and  ab- 
staining from  further  material  purchases  during  the  balance 
of  the  summer  and  early  fall,  being  the  period  of  heaviest 
pressure  from  crop  movements  on  the  North  American 
continent,  left  all  Canadian  and  U.  S.  grain  markets  in  an 
extremely  abnormal  position. 

Trading  in  wheat  futures  on  the  Chicago  Board  of  Trade 
was  commenced  July  15th,    and  at  about  the  same  time  on 
various  other  grain  exchanges  in  the  United  States. 
The  1920  Crop 

There  was,  therefore,  made  available  to  the  United  States 
producer  and  grain  trade  an  opportunity  to  market  a  part  of 
the  then  maturing  1920  spring  and  winter  wheat  crops  of 
their  country.  The  Canadian  Wheat  Board  was  at  that  time 
in  sole  control  of  the  marketing  of  Canadian  wheat,  their 
activities  being,  however,  confined  to  the  disposal  of  the 
balance  of  our  1919  crop.  The  Winnipeg  Grain  Exchange 
could  not  be  opened  for  trading  in  wheat  until  the  policy 
of  the  Dominion  Government  for  another  crop  year  had 
been  determined  upon,  and  although  urgent  representations 
were  made  at  Ottawa  for  an  early  and  definite  decision  on 
'-'■.  the  government's  approval  of  our  return  to 
open  markets  for  wheat  was  not  definitely  and  finally 
known  until  August  3,  1920,  and  this  sanction  of  open  trad- 
ing was  made  subject  to  conditions  of  the  Enabling  Bill 
which  had  been  passed  by  parliament  early  in  the  summer, 
and  which  authorized  the  re-appointment  of  the  wheat 
board  by  order-in-council  if  at  any  time  this  was  deemed 
expedient. 

Arrangements  were  immediately  made  for  the  opening 
of  wheat  trading  on  the  Winnipeg  Grain  Exchange,  as  you 
know,  the  date  being  set  for  August  18,  1920.  Mark,  now,  it 
was  therefore  after  the  middle  of  August  before  open 
market  facilities  were  available  for  trading  in  Canadian 
wheat  of  the  1920  crop;  also,  note  the  large  purchases  by 
the  British  Wheat  Commission  in  May,  June  and  July,  and 
their  withdrawal  as  buyers  from  the  markets  on  July  29th, 
1920,  and  their  almost  total  abstinence  from  further  pur- 
chases till  late  in  the  fall  or  e&rly  winter. 

"   Effect  of  Government  Control 

The  wisdom  or  necessity  of  this  policy  we  do  not  know; 
the  war  was  over;  the  armistice  had  been  signed  some 
eighteen  months;  declining  prices  of  many  commodities 
were  then  apparent  and  generally  expected,  while  wheat 
supplies  were  not  plentiful,  the  condition  of  the  growing 
crops  was  then  not  distinctly  unfavorable  toward  the  pro- 
duction of  suflficient  wheat  supplies  for  the  ensuing  year. 
What,  therefore,  actuated  the  British  Wheat  Commission  in 
making  extensive  purchases  for  the  creation  of  large 
reserves  at  this  time?  It  would  not  have  been,  we  feel,  the 
policy  of  the  merchant  grain  and  milling  trade  functioning 
under  normal  conditions:  shrewd  purchasers  would  not  buy 
heavily,  st  the  tail  end  of  a  crop  year,  supplies  for  several 
fut'ire  months'  requirements  at  a  level  of  prices  as  high  or 
higher  than  any  e?tablished  during  the  war  when,  both 
before  and  after  goveiTiment  control  of  wheat  marketing, 
conditions  of  transportation,  finance  and  necessity  for 
accumulation  of  food  reserves  justified  any  price  or  means 
to  obtain  desired  supplies. 


The  effect  of  this  governmmental  buying  policy  is  well 
known  new.  It  created  an  artificial  price  level;  it  led  to  a 
misconception  on  the  part  of  the  producer  and  many  in  the 
grain  and  milling  trade  as  to  what  might  be  expected  for 
prices  for  the  then  growing  crops. 

The  earlier  return  to  open  wheat  markets  in  the  United 
States  provided  means  for  the  sale  of  United  States  wheat, 
while  Great  Britain  was  making  these  unwelcome  purchases. 
Conditions  in  this  country  as  to  government  operation  of  the 
wheat  board  left  us  unable  to  sell  our  growing  crop. 

The  1921  Crop 

It  requires  little  imagination  to  see  the  abnormal  situation 
facing  the  grain  and  milling  trade  when  our  markets  were 
opened  for  trading  on  August  18th  and  for  several  months 
thereafter.  Our  largest  buyer  of  wheat  surfeited  with 
supplies  at  high  prices  and  out  of  the  market  at  the  time  of 
the  heaviest  pressure  of  our  crop  movement,  when  under 
usual  conditions  there  would  be  active  and  daily  buying  for 
both  immediate  and  future  requirements. 

This  situat-on  wp.s  not  app.-irent  for  some  time;  other 
countries  were  buying  heavily,  r  'rticularly  our  neighbors  to 
the  south;  however,  deflation  in  values  of  all  farm  products, 
hides,  livestock,  etc.,  also  commodities  such  as  cotton,  copper, 
textiles,  sugar,  etc.,  was  well  on  and  wheat  prices  receded 
from  the  high  levels  of  the  early  summer.  A  storm  of  protest 
against  the  open  grain  exchange  methods  of  marketing 
grain  swept  over  the  continent.  Much  unfavorable  and  mis- 
informed criticism  was  directed  against  us.  Most  of  it 
destructive  in  suggestion  and  little,  if  any,  of  a  constructive 
nature  or  help  in  improving  and  maintaining  or  stablizing 
the  existing  methods  of  grain  marketing  and  finance.  Had 
the  present  system^  not  been  fundamentally  sound  and 
economically  efficient,  it  could  not  withstand  the  attacks 
which  have  been  made  upon  it,  attacks  having  in  many 
instances,  ulterior  motives  and  also  to  an  extent  against  the 
grain  trade  that  no  other  industry  or  section  of  comm.ercial 
life  has  had  directed  against  it. 

Deflation  In  Grain  Trade 

The  world  today  knows  and  hears  much  of  deflation  in 
values;  many  erstwhile  prosperous  business  concerns  have 
been  mired  and  dragged  to  financial  insolvency  from  its 
effects:  our  producers  of  grain  have  suffered  most  severely 
from  its  consequences;  the  grain  and  milling  trade  have  not 
been  free  from  huge  losses  from  it.  It  is,  however,  a  remark- 
able tribute  to  the  soundness  of  our  grain  marketing  system 
that  since  our  wheat  markets  were  opened  on  Aug^Jst  18, 
1920,  there  has  never  been  a  business  day  when  grain  could 
not  be  sold  or  bought  and  at  public  and  well-known  prices  in 
open  competitive  market  places  where  buyer  and  seller 
meet  to  trade  under  established  and  uniform  regulations  for 
the  making  and  fulfilment  of  contracts,  and  where  the  fullest 
information  as  to  the  world's  crop  and  marketing  conditions 
are  made  available  for  their  use,  and  for  public  dissemina- 
tior  ;  that  notwithstanding  the  commercial  hazards  incident 
to  the  deflr.tion  period,  our  trp.de  as  a  whole  have  met  their 
obligati-ns  to  the  producer  as  a  seVer,  and  to  the  consumer 
as  a  buyer,  with  a  minimum  of  financial  embarrassment  to 
all  involved.  A  study  of  the  contract  in  this  report  as  be- 
tween the  marketing  of  grain  and  the  sale  of  many  other 
products  of  the  farm,  such  as  wool,  hides,  livestock,  etc,, 
cannot  but  reflect  to  the  credit,  commendation  and  approval 
of  the  most  efficient  and  economical  grain  handling  practices 
of  the  world  today.  Business  methods,  human  business 
organizations  and  physical  grain  handling  machinery,  the 
result  of  competitive  evolution  over  a  period  of  years,  which 
have  so  successfully  marketed,  financed  and  transported  our 
crops  of  the  past  season  during  a  year  of  reajustment  in 
commerce  and  finance,  such  as  we  hope  will  not  soon  again 
be  experienced— who  can  deny  that  this  is  not  an  achievment 
of  note,  and  that  the  severe  test  of  the  year's  business  is  but 
further  proof  of  the  value  of  the  Winnipeg  Grain  Exchange 
to  the  producer  and  business  interests  of  the  country  at  large? 


January  6,   1922. 


THE      MONETARY      TIMES 


243 


The  Spanish  River  Pulp  &  Paper 

Mills,  Limited 

Sault    Ste.  Marie,    Ontario 


■ 

DAILY    CAPACITY 

, 

News  Print  Paper  - 

- 

- 

- 

675  tons 

Ground  Wood  Pulp 

- 

- 

- 

535  tons 

Sulphite  Pulp           U 

- 

- 

- 

220  tons 

Board 

Mills 

At 

35  tons 

Marie,  Ont.; 

Espanoh 

,  Ont.; 

Sturgeon 

THE  LARGEST  PRODUCERS  OF  NEWS  PRINT  PAPER  IN  THE  DOMINION 

OF    CANADA 


WALTER  WOODS  LIMITED 


Importers  and  Dealers  in 


B'  RUSHES  III 
ASKETS  UU 
ROOMS       II 


OODENWARE 
ILLOWARE 
RAPPING    PAPER 


TWINES,   PAPER   BAGS,   CORDAGE 
GROCERS'   SPECIALTIES 


HAMILTON    &    WINNIPEG 


§1 


EDDY'S 


\ 


% 


Are  As  Safe  As 
Matches  Can  Be 


Moreover — they  are  good  matches.  Sound 
sticks  that  will  not  break  in  striking,  heads 
that  will  light  when  struck,  but  will  not 
explode  when  stepped  on — in  short,  real 
matches,  as  perfect  as  skill  and  match 
making  experience  can  make  them. 

Vt'lwn  i/oK  ^^s^k  for  mntchex  at  ]/our 
dealers  stc  that  j/ov  ■^■■'  K'Mv'»  every 
timr.     The  name  ■  ■>  the  out- 

side  of  the  box  gwi  'if  quality 

of  the  matche*  intuie. 

The  E.  B.  EDDY  CO.,  Limited 

HULL  CANADA 


244 


THE      MONETARY      TIMES 


Volume    68 


Sample  Markets. 

Sample  market  trading  has  not  materialized  in  your 
market  here  to  the  extent  that  had  been  expected.  Facilities 
by  way  of  a  car  dumping  bureau,  sample  tables  and  space 
therefor  in  the  trading  room  have  been  provided.  The 
premium  condition  existent  during  most  of  the  crop  move- 
ment of  the  past  year,  and  to  date  on  the  new  crop  militates 
against  its  development;  also  the  railway  companies'  stop- 
over charge  for  grain  billed  to  Winnipeg  for  orders  is  a 
considerable  drain  upon  extra  earning  or  premium  made 
available  throuarh  selling  grain  on  sample.  The  closing  of 
the  United  Stales  markets  to  the  free  entry  of  Canadian 
wheat  seriously  injured  Winnipeg  as  a  sample  trading 
centi-e,  as  during  the  years  of  short  spring  wheat  production 
or  a  wheat  crop  of  poor  quality  in  the  American  north- 
western spring  wheat  states  unsatisfactory  for  the  production 
of  high  grade  flour,  we  would  have  a  heavy  demand  for  our 
high  quality  Canadian  wheat.  This  condition  existed  during 
the  past  year  when  some  48,000,000  bushels  of  Canadian 
wheat  were  exported  from  Canada  to  the  United  States. 

It  is  regretable  that  the  reciprocal  offer  which  stood  on 
the  statute  books  of  the  United  States  for  so  many  years  had 
not  been  taken  advantage  of  by  your  government,  and  thus 
provided  free  entry  into  this  broad  market  for  our  grain 
and  many  other  forms  of  farm  produce. 

The  necessary  legislation  to  permit  of  sample  trading 
and  markets  was  enacted  at  Ottawa  in  1917.  The  various 
market  conditions  made  it  impossible  to  operate  a  successful 
sample  market  and  which  developed  since  enactment  of  this 
legislation  such  as  government  control,  finance,  the  un- 
certainty of  return  to  open  wheat  marketing,  etc.,  are  now 
passed.  If  our  producers  desire  to  dispose  of  their  grain  on 
sample,  facilities  for  this  purpose  are  now  available  and 
our  trade  should  develop  this  market,  now  already  the 
greatest  primary  wheat  market,  to  a  position  of  equal  im- 
portance as  a  sample  market. 

Transportation. 

So  inter-related  to  grain  marketing,  so  difficult  to  obtain 
in  liquid  quuantity  during  war-time  period,  transportation 
has  now  reversed  this  condition;  it  is  available  by  rail  or 
water  in  comparative  plenty  wherever  and  whenever 
required,  and  this  is  a  welcome  relief  and  benefit  to  all  as 
compared  with  its  insufficiency  of  the  past  few  years. 

In  connection  wdth  transportation  matters  you  will  recall 
that  as  a  result  of  negotiations  conducted  by  representatives 
of  your  exchange  with  the  railroads  and  Board  of  Railroad 
Commissioners  at  Ottawa,  a  ruliU;?  was  secured  from  the 
board  making  possible  the  payment  in  Canadian  funds  of  the 
approximate  charges  for  the  Canadian  haul  in  international 
frcicht  traffic  between  Canada  and  the  United  States.  This 
arrangement  has  made  a  material  saving  in  transportation 
charges,  benefiting  the  grain  and  milling  trade,  the  producer, 
consumer — in   short,  the  entire  country. 

We  are  now  well  into  the  handling  of  a  new  crop,  a  crop 
which  it  is  estimated,  will  be  the  largest  harvested  in  the 
Canadian  West  since  the  bumper  yield  of  1915;  a  crop  which 
is  moving  to  markets  some  two  v/eeks  earlier  than  normal, 
and  one  that,  notwithstanding  the  dangers  of  the  hottest 
summer  on  record,  gives  indication  of  yielding  well  in 
quality  ns  compared  with  our  average  production. 

An  amendment  to  By-law  26,  carried  August  4,  1920,  gave 
your  Council  wide  and  drastic  powers  with  reference  to  ob- 
taining information  as  to  the  trading  operations  of  your 
members;  to  prohibit  trading  and  to  fix  or  establish  settle- 
ment values  on  contract;  powers  probably  wider  and  more 
absolute  than  ever  given  the  governing  body  of  a  grain 
exchange.  You  are  to  be  congratulated  upon  the  fact  that 
during  the  trading  of  the  past  twelve  months  it  has  not  been 
fonud  necessary  for  the  Council  to  exercise  this  power. 

There  is  today  a  wider  and  keener  interest  in  grain 
marketing  methods  and  systems  than  ever  before  existed; 
there  are  many  criticisms  of  these  methods.  Our  methods  of 
grain  marketing  should  be  more  clearly  under^itood  by  the 
producer,  the  business  and  general  community  at  large,  and 
we  submit  to  you  the  suggestion  of  co-operation  with,  and 
education  of,  your  trade,  your  customers  and  the  general 
public  toward  that  end. 


THE    PULP    AND     PAPER    INDUSTRY    IN     1921 


Year  Was  One  of  Adverse  Conditions,  In  Which  Production 

and   Exports    Declined — Developments    in 

Riordon  Company 


There  is  probably  no  other  industry  in  Canada  which 
has  had  so  rapid  and  so  romantic  a  development  as  the 
pulp  and  paper  trade.  Close  to  one  hundred  years  ago. 
In  a  little  village  known  as  Crook's  Hollow,  was  erected 
the  first  paper  mill  in  what  was  known  as  Upper  Canada. 
The  Hollows  was  named  after  James  Crooks,  who  earned 
the  distinction  of  manufacturing  the  first  sheet  of  paper 
in  Upper  Canada,  for  which  he  received  a  bounty  of  one 
hundred   pounds   from    England. 

In  the  following  years  several  small  companies  built 
mills,  and  in  1861,  John  Riordon  established  a  plant  with 
a  capacity  of  ten  tons  daily,  from  which  was  developed 
that  ambitious  enterprise,  the  Riordon  Company,  Limited, 
which  met  with  such  disastrous  results  last  year  in  what 
seemed   to  be  ill-advised   expansion. 

However,  it  is  not  to  dwell  on  historical  facts,  for  they 
would  fill  volumes,  but  just  to  briefly  introduce  a  contrast 
which  will  be  interesting  in  connection  with  present-day 
affairs.  Now  we  speak  of  pulp  and  paper  mills  with  a 
capacity  of  hundreds  of  tons  daily,  and  think  of  the  yearly 
production  in  millions  of  tons. 

In  1917,  total  production  of  pulp  and  paper  in  the 
Dominion,  was  estimated  at  $96,340,327.  By  1920  this 
figure  had  increased  by  about  one  hundred  per  cent.  Of 
course  that  is  expressing  it  in  dollars  and  cents,  which 
basis  Includes  the  increase  in  prices;  but  while  the  increase 
in  production  in  that  period  did  not  increase  one  hundred  per 
cent.,  there  is  no  doubt  that  during  those  four  years  the 
greatest  expansion  In  the  industry  took  place. 

When  The  Depression  Came 

So  prosperous  had  the  industry  become,  that  when 
business  readjustment  commenced  in  1920,  there  were 
some  who  believed  that  the  pulp  and  paper  trade  would 
not  suffer  any  set-back,  or  only  a  slight  one.  But  the 
close  of  1920  saw  depression  looming  on  the  horizon,  and 
the  stock  exchange  foreshadowed  adverse  factors. 

Early  in  1921,  prominent  pulp  and  paper  companies 
tried  to  explain  away  the  fact  that  the  industry  was  due 
for  a  slump,  by  a  good  deal  of  undue  optimism.  At  the 
end  of  January  the  Riordon  Company  was  quoted  as  having 
made  an  investigation,  and  proved  that  depression  was 
not  serious,  and  that  the  bottom  had  been  reached.  Sim- 
ilar statements  were  made  by  other  companies,  but 
subsequent  events  showed  these  to  be  false. 

With  the  exception  of  the  Riordon  Company.which 
was  a  victim  of  over-ambition,  the  old-established  enter- 
prises, with  strong  standing,  were  able  to  bear  up  under 
the  strain  of  sudden  and  drastic  reaction.  Only  new 
enterprises,  like  Raministiqua  and  Mattagami,  experi- 
enced difficulties. 

Concerns  which  got  into  the  business  at  or  near  the 
peak  of  the  boom,  and  which  installed  macninery  at  top 
prices,  only  to  find  the  market  tor  their  product  fall  away 
to  nothing  almost  before  their  mills  were  in  operation, 
were  bound  to  suffer  casualties.  No  industry  however 
large  and  strong,  can  escape  the  cycle  of  depression,  which 
is  the  inevitable  result  of  extreme  prosperity. 

Exports  and  Imports 

There  are  no  official  or  accurate  figures  available  as 
to  the  actual  change  which  took  place  in  production  in 
1921,  but  there  are  statistics  which  give  a  fairly  good 
Idea  of  the  condition  which  existed.  Perhaps  the  most 
illustrative  table  is  that  of  imports  and  exports  of  wood, 
paper  and  products.  It  must  be  borne  in  mind  that  the 
following  figures,  besides  showing  the  falling  off  in 
production,   reflect   the   decrease   in   prices: 


January   6,   1922.  THEMONETARY      TIMES  **5 

lllllllllllllllllllllllllllllllllllllllllllllllllllillllllllllllllllllllllllllllllllllllllllllillllllffl^  '~~^~^^^~' 


THE    CONSUMERS'    GAS    CO. 

OF    TORONTO 


The  Consumers'  Gas  Company  has  a  perpetual  charter  for  the  manu- 
facture and  sale  of  gas  in  the  City  of  Torqnto,  Townships  of  York,  Etobicoke, 
Vaughan,  Markham  and  Scarboro. 

The  output  of  gas  for  the  year  ended  September  30,  1921,  was  over 
5,000,000  thousand  cubic  feet.  In  addition,  nearly  $330,000  worth  of 
merchandise  was  sold,  and  about  $1,035,000  worth  of  residual  products. 

The  present  capital  of  the  Company  is  $6,000,000.  There  is  a  reserve 
fund  of  $3,819,654.19,  and  a  plant  renewal  fund  of  $1,580,931.25.  Assets 
total  $12,996,822.75.  Profits  for  the  past  fiscal  year  were  $1,540,932.58, 
after  providing  for  all  expenses  of  management  and  operation. 

The  reserve  and  plant  renewal  funds  together  equal  90%  of  the  Com- 
pany's capital,  which  funds  are  invested  principally  in  the  Company's  busi- 
ness, with  no  interest  charges  against  them.  This  means  that  the  Company 
need  earn  only  about  5.2%  on  the  money  invested  in  order  to  meet  its  divi- 
dend requirement  of  1 0%  on  the  capital  stock.  The  Company  has  steadily 
maintained  its  1  0%  dividend  for  forty-seven  years. 

The  Directors  are:  Messrs.  A.  W.  Austin,  President;  Wellington  Francis, 
K.C.,  Vice-President;  A.  H.  Campbell;  L.  Goldman;  F.  Le  M.  Grasett,  M.D.; 
Herbert  Langlois;  Lieut. -Col.  J.  F.  Michie;  W.  Mulock,  Jr.;  F.  G.  Osier.  The 
General  Manager  is  Mr.  Arthur  Hewitt;  the  Secretary  Mr.  John  J.  Armstrong. 


I 

able  Showing  Increase  of  Company's 

Business 

Oas 

No  of 

Popula- 

Cons'n 

Pop. 

MUea 

Year 

Output 

Meters 

tion  of 

per 

per 

of 

M.  C.n.   Fl. 

\n  11*0 

District 
Supplied 

Capita 
Ch   Ft. 

Meier 

Mttn 

1871 

52,595 

1,566 

56,000 

617 

36 

44 

1881 

164,994 

4,327 

86,443 

1,392 

20 

100 

1891 

509,414 

14,838 

181,220 

2,199 

12 

207 

1901 

873,389 

28,543 

225,000 

3,490 

8 

257 

1911 

2,843,041 

72,544 

410,000 

6,444 

5.7 

456 

1921     5,033,986     127,555      575,000      8,256       4.5     610 


SaiiuiiiiiiiiiiiiiuuiiiNiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiun^^^ 


246 


THE      MONETARY      TIMES 


Volume    68 


Imports 

1920                     Dutiable  Free  Exports 

October $2,454,444  $3,346,444  $29,874,174 

November     .     .    2,152,737  3,597,550  23,482,199 

December    .     ..    1,719,910  3,311,618  23,270,641 

1921 

January    .     .     .    1,254,278  2,475,402  15,672,698 

February    .     ..    1,202,870  1,964,713  15,000,909 

March 1,579,983  2,332,248  19,813,456 

April    ....    1,099,769  1,721,895  10,845,255 

May 1,160,548  1,801,471  13,777,804 

June 1,364,692  1,847,230  13,279,906 

July     ....    1,141,839  1,588,361  15,215,018 

August    ....    1,184,094  1,867,624  16,512,887 

September    .     .    1,181,019  1,944,250  15,974,941 

October .  

It  will  be  seen  from  above  how  great  and  rapid  was 
the  depression.  It  is  notable,  however,  that  some  slight 
improvement  was  made  in  the  latter  months. 

What  the   Stock  Exchanges   Tell 

As  regards  the  individual  companies,  it  is  not  possible 
to  go  into  detail  as  to  the  condition  which  prevailed, 
except  in  one  or  two  eventful  cases.  But  the  stock 
exchanges  tell  part  of  the  story.  The  following  are  figures 
showing  the  trend  of  stocks  of  the  principal  concerns 
during  the  year: 

First     Six  Months     Close     Close 
High  Low  Oct.        Nov. 

Laurentide 98  71%  78%  75 

Price    Bros 421^  291/2  38  35 

Riordan,   com 160  7^4  5  5% 

Spanish   Eiver 89%  46%  68%  58 

Spanish   River,   pfd.    ...95  55  75%  72 

Wayagamack 89  4  6  47  41 

Abitibi 58  22  32  31 

As  In  the  case  of  the  figures  of  exports  and  imports, 
it  is  notable  that  the  above  figures  also  reflect  an  improve- 
ment  in    the   industry    in   the   latter    months    of   the   year. 

Two  of  the  fundamental  factors  were  decreased  pro- 
duction and  falling  prices.  Several  companies  were 
affected  by  strikes,  but  these  eventually  resulted  in  the 
reduction  of  wages  from  10  per  cent,  in  some  cases,  to 
30  per  cent,  in  others.  The  drop  in  newsprint  rates  is 
the  most  important  consideration  in  prices.  The  rate  for 
the  last  quarter  of  1921  was  4  cents  per  pound,  as  com- 
pared with  6%  cents  in  the  year  previous.  Still,  this 
reduced  figure  was  above  1919,  when  the  yearly  range 
was  from  3.65  to  3.90. 

New  Financing 

During  the  early  part  of  last  year  the  flood  of  pulp 
and  paper  securities  of  1920  continued.  But  the  new 
financing  was  of  a  different  nature.  In  1920  a  good  deal 
of  new  stock  was  issued,  for  the  purpose  of  expansion. 
In  1921,  no  new  stock  was  issued,  for  such  a  practice  is 
unwise  in  times  of  depression. 

Not  only  that,  but  the  financing  carried  on  last  year 
was  largely  for  the  purpose  of  the  companies  recouping 
themselves  for  heavy  capital  expenditures,  incurred  partly 
out  of  the  income,  and  partly  at  the  expense  of  liquid 
position  during  the  height  of  prosperity. 

Those  companies  which  were  fortunate  to  be  in  pretty 
good  financial  standing,  were  able  to  raise  capital  in  this 
way  to  bridge  them  over  the  difficult  period.  But  the 
cost  of  the  money  was  high,  for  not  only  was  money 
rather  scarce,  but  there  was  an  unfavorable  sentiment 
attached  to  the  pulp  and  paper  industry  in  its  adversity. 
Most  companies  borrowed  with  interest  rates  at  eight 
per  cent.,   or  over. 

The  following  are  the  principal  issues  which  were  all 
made  in  the  first  half  of  the  year: 

Fort  William  Pulp  and  Paper  Company    ..$1,000,000 

Howard  Smith  Paper  Mills,  Ltd 1,000,000 

Spanish    River    Pulp  and  Paper    Mills,  Ltd. .    3,000,000 
Abitibl  Power  and  Paper  Company 4,000,000 


Fraser   Companies,   Ltd 2,000,000 

Clarke  Bros 1,250,000 

Brompton   Pulp  and  Paper  Company 2,500,000 

The  Riordon  Disaster 

The  outstanding  event  of  the  year  was  the  Riordon 
disaster,  just  as  the  most  important  feature  of  the  previous 
year  was  Riordon  consolidation.  In  1920,  an  ambitious 
merger  was  formed,  comprising  the  Kipawa  Company, 
W.  C.  Edwards  &  Company,  Ltd.,  Gilmour  &  Company, 
Ltd.,  and  the  Ticonderoga  Pulp  and  Paper  Company,  the 
principal   resources   of  which   are  in   the  Ottawa  Valley. 

The  combined  companies,  with  the  Riordon  enterprise, 
controlled  approximately  12,000  square  miles  of  timber, 
containing  25,000,000  cords  of  pulpwood,  1,200,000,000 
feet  of  standing  pine,  150,000  horsepower  from  water 
resources.  Estimated  pulp  and  paper  capacity  was 
150,000  tons  a  year,  and  a  pine  output  of  125,000,000 
feet.  Later,  about  1,100  square  miles  of  timber  limits, 
together  with  undeveloped  water  power,  were  purchased 
from  interests  situated  on  the  Quinze  River  in  Quebec 
province. 

Unfortunately,  the  plans  of  the  directors  of  this  huge 
amalgamation  were  ill-advised.  Perhaps  if  they  had  been 
introduced  at  an  earlier  date,  or  postponed  until  the  cer- 
tainty of  business  had  been  assured,  such  plans  would 
have  resulted  in  a  gigantic  and  valuable  industry.  But 
they  resulted  in  the  loss  of  millions  of  dollars,  and  a 
serious  inconvenience  to  the  pulp  and  paper  industry  in 
Canada. 

F.  P.  Jones,  who  was  financially  interested  in  the 
concern,  and  who  took  part  in  the  directing  of  the  com- 
pany, after  the  crash,  summed  up  the  situation  in  a  few 
words,  when  he  said.  "Some  people  say  the  drop  in  price 
of  pulp  was  the  cause.  In  my  opinion,  it  was  not  the 
cause.  It  only  made  conditions  worse,  and  brought  the 
house  down  sooner  than  it  would  otherwise  have  come 
down.  The  whole  cause  was  buying  property  and  build- 
ing plants  without  having  sufficient  money  to  pay  for 
them." 

The  company  needed  about  $11,000,000  to  pay  its 
debts  and  biiild  up  a  liquid  position.  But  it  came  for 
funds  at  a  time  when  not  only  money  was  scarce,  but  the 
severe  readjustment  in  the  industry  generally  had 
brought  i^ulp  and  paper  securities  into  an  unfavorable 
light,  and  caused  a  drastic  slump  in  prices  on  the  stock 
exchange.  Consequently  the  debts  could  not  be  met,  and 
for  several  months  affairs  dragged  along,  with  occasional 
lawsuits  on  the  part  of  creditors.  Still  the  situation  has 
not  been  finally  cleared,  but  the  company  is  relying  on 
its  tremendous  resources  to  pull  it  through. 

Feared  Competition 

When  the  price  of  pulp  and  paper  securities  began 
to  fall  rather  sharply  at  the  beginning  of  1921,  many  fears 
were  aroused,  among  which  was  that  concerning  compet- 
ition of  Europe  in  the  United  States  market.  Such 
anxieties  were  soon  put  to  rest,  l^wever.  Among  the 
soothing  reports  was  that  by  Edward  Beck,  of  the  Can- 
adian Pulp  and  Paper  Association,  who  had  made  a 
rather  extensive  trip  in  Europe,  and  stated  that  the 
Scandinavian  forests  are  pigmy  in  extent  in  comparison 
with  Canada's. 

The  United  States  is  Canada's  best  market,  so  that 
it  was  only  natural  that  fear  should  have  been  expressed 
when  it  seemed  as  though  adverse  factors  were  entering 
there.  Canadian  production  of  newsprint  increased  from 
150,000  tons  in  1909  to  over  850,000  in  1920.  Today  the 
Canadian  newsprint  mills  are  equipped  to  produce  about 
1,000,000  tons  of  paper  a  year.  They  are  supported  by 
what  is  admitted  to  be  the  greatest  potential  pulpwood 
reserve  in  the  world. 

About  80  per  cent,  of  the  output  of  these  mills  is 
marketed  in  the  United  States.  During  the  twelve  months 
ended  August,  1921,  American  newspaper  publishers  pur- 
chased and  used  no  less  than  637.266  tons  of  Canadian 
newsprint. 


HF  The  Monetary  times 

1 

M66 

V.68 

no.l 


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