IN DIRE STRAITS

Evening Star, Issue 21005, 20 January 1932, Page 9

IN DIRE STRAITS

NEW YORK'S FINANCES UNAVOIDABLE CRISIS REACHED Press Association —By Telegraph—Copyright. NEW YORK, January 18. Despite desperate struggles during the past few days by the Board of Estimates to find a way out of Now York’s financial distress, it is now feared that an unavoidable crisis has been reached and default upon notes totalling 58,500,000d0l is feared to-morrow. In addition to these notes, which arc simply those considered to be the most immediately pressing, the city is considerably worried about its ability to continue the daily running expenses, aside from salaries. An examination of the ‘ City Record,’ New York’s official organ of civic affairs, disclosed that the city has paid no bills since January 1. Salaries have been paid to date, but these have taken every availablp dollar.

A lengthy conference was held by the mayor, the city comptroller, and other officials at the homo of President Mitchell, of the National City Bank, but it was apparently without results, for the bankers appear to be unwilling to advance the funds to enable the city to meet its obligations. The large retrenchments or promises already made are still regarded as insufficient. One prominent banker stated: “ We are not particularly impressed by the fact that the Board of Estimates placed approximately 12,000,000d0l in projects ‘on the shelf.’ Many of those projects, as a matter of fact, had been on the shelf for many years, and were likely to have stayed there whether the city had the money or not.” Among, the day’s outstanding bankruptcies were the Hudson River Navigation Corporation and the Spreckles Sugar Company. The banks which have been closed include the First National and the Commercial of Champaign, Illinois, with a combined total of deposits of 6,600,000d01, and the First National of Durham, Carolina, with deposits of 3,500,000d01. The directors of the latter bank asserted that the closure was due to the withdrawal since September 1 of 4,000,000 dollars of deposits.