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"The transition to a new and sober era is not going to be easy. The American people are in a mood of invincible optimism. Three years ago they were speculating in Florida real estate and finally that bubble burst. They then speculated in urban real estate. . . . Now they have turned to the stockmarket, where prices of the stocks of mail order houses, chain stores, motor companies and soft-drink firms are selling on a basis to yield half as much as the obligations of the U. S. government. . . .
"All the experience of the past points clearly to the conclusion that prices are too high and must come down. . . . However, our concern is not about what may happen in the stockmarket. . . .
"We may look forward to the longer future with confidence, but the great rewards of business and banking during the next decade will probably go to the plodders rather than to the plotters, to the calculators instead of to the speculators, to the thrifty and not to the shifty."
Lion-like in its beginnings, the convention of U. S. bankers went out like a lamb. Scarcely had the delegates assembled when Representative Louis T. McFadden, chairman of the House Committee on Banking and Currency, introduced the mooted question of credit and the war of the banks and the bulls. He warned that the Federal Reserve policy of tight money might "produce a business slump without intending to do so." On the other hand, he warned that relaxing the policy might result in more credit going "directly into the speculative loans." Between the two horns of the dilemma, he sought a legislative solution. Perhaps the law might be amended to give the Federal Reserve "a commanding position . . . controlling all the elements . . . in the credit situation."
Not entirely clear to the layman, this threat was not misunderstood by fearful traders. It meant, in two words: "BROKERS' LOANS." And to emphasize the point, brokers' loans mounted last week to $4,569,978,000, highest for all time, surpassing even the figure for June 6. Apparently undisturbed, the stock-market went about its business, saw a seat sold for a record $425,000, dickered for the adjoining 20-story Postal Telegraph building as an annex, appointed Mrs. Catherine M. Healy of Montclair, N. J., as its first woman purchasing agent.
Chains. Unjust are the sneers which currently link Louisiana's bankers with Louisiana's onetime lotteries. Unkind are pictures of bewhiskered, bejuleped col- onels. As every Louisianan knows, New Orleans can boast many an active, enterprising apostle of sound finance. One such journeyed to Philadelphia last week to address fellow-bankers on bedrock principles of their profession. No dodderer, no lotterer, Rudolf S. Hecht is the able president of the Hibernia Bank & Trust Co. of New Orleans. German-born Banker Hecht has become so substantial a support of Louisiana industry that the Times-Picayune gratefully hailed him as New Orleans' most constructive citizen. As a reward he won the Times-Picayune trophy. For these reasons, and for one other—his passionate fondness for pastry—Banker Hecht is famed.
To attentive bankers, last week, he said: