Home Loan Act A Fraud,
Writer In “Nation” Says
Henry Goldey Says Vast Majority of Mortgagees Won’t
Be Permitted To Make Exchange and Congress
Knew That; Corporation Head Makes Comment
(From The Nation.)
With the foreclosure crisis for
heme owners daily becoming- more
■itc 'he article in The Nation this
k by Henry Goldey, ' The Home
Loan Act -A Fraud.” becomes vitally
inipc’.'tant to thousands of mort
gagois and mortgagees in the 3.000
counties of the United States, in each
c t which the new act is expected to
rate as rapidly as possible.
Basically the working of this home
lean act depends upon the exchange
bv a distressed mortgagee of his un
vaid moitgage for bonds of the Home
Owners Loan Corporation, the inter
est on these bonds being guaranteed
by the Government but not the bonds
tnemstlves. ,
Pointing out that:
• Any distressed home owner with a
large mortgage on his property, with
taxes unpaid, and with a house in
need of repairs, after reading about
this bill must have felt very grate
xut tow;.rd Lncle Sam, who was
ready, able and willing, through this
corporation, to lend him up to 80 per
cent of the present value of his pro
pc iiy and to give him froih fifteen to
eighteen years in which to repay it.
Unfortunately. however, there
s;ms to be a slight hitch in the 80
per Cent plan. Suppose, for example,
that the mortgagee refuses to ex
change his mortgage for the bonds.
What then? Is it uossible that these
bends might not prove sufficiently at
uative to moitgagees to warrant an
exchange? Is it possible that some
mortgagees would not be legally per
muted to make the exchange? The
facts which I intend to prove are (1)
that the vast majority of mort
gagees would not be permitted to ex
change their mortgage for these
tends; (2) that Congress knew this
to be tha case; (3) that independent
of legal restrictions, the bonds are of
little woith and therefore unattrac
tive. and that Congress knew this al-
Mr Goldey goes on to explain that
tince th<=se bonds authorized for ex
change are merely debentures, “mere
promises of the corporation to pay,
unsecured by the pledge of any spe
cific assets,” the usual channels by
v.i.ich they would naturally be sub
r.huted tor the existing mortgages I
exo Ualess.
Under the laws of several states,” |
says Mr. Goldey, “Life insurance com-j
panics, savings banks, building and;
lean associations title companies and 1
executors and trustees of estates are
prohibited from making investments,
except m specific securities, such as
gevernment bonds, state bonds, cer
tain municipal and county bonds;
first moitgage bonds of specific rail
reads and in some cases of utilities;
fiist mortgages on real estate not in
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BILLER’S SALE
Henderson, N. C. (
CHICAGO PULLMAN
DAILY
Lv. Goldsboro 7.00 AM
Lv. Selma 7:45 AM
Lv. Raleigh 8-<35 AM
Lv. Burlington 10:28 AM
Lv. Asheville 6:40 FM
Ar Chicago * 2:50
Through The
Land of the Sky .
The Cool and Scenic Route
Southern Railway
I LAST CALL I
I For 1932 City Taxes I
I All property in the city on which 1932
taxes and street assessments have not H
been paid will be advertised for sale after
■ Tuesday, August 1.
This is the last call. Pay now and avoid
I further costs and inconvenience. ? I
I S. B. BURWELL/ I
City Tax Collector.
excess (in most cases) of 60 per cent
r of the value of the property. They are
not permitted to invest in the un
j bonds of any corporation.
> o rhe d * benture bonds of the Home
r Owners Loan Corporation are theie-
lore ineligible under State laws for in-
> bV «• Ch su P ervis ed financial
t jinstltutions. Since approximately 80
pc r cent of home mortgages ai»
by these financial institutions and an
unknown but undoubtedly substantial
percentage of the balance is held by
executors and trustees, it is clear that
no relief under the bill can be ex-,
peded by the vast mapority of the 1
hom.m owners in the country.
After a discussion of the colossal
cost of administering the new act and
the chances of repayment to the Gov
ernment of either interest or principal j
chances of which the author is de
finitely pessimistic, Mr. Goldey men
tions a peculiar feature of the new
legislation which covers the organ
ization of building and loan associa- '
tions in sections of the country where
such associations do not exist;
“The act provides that the govern
ment shall contribute capital, dollar
for dollar up to a certain amount, to
such new building and loan associa
tions, and also specifies the kind of ■
securities such building and loan as- j
sociations are permitted to invest in. I
The bonds of the Home Owners’ Loan 1
Corporation are not included.
In summing up his outline of the ’
■new pseudo-relief legislation Mr. I
Goldey declares:
“The passage by Congress of the:
Home Owners’ Loan Act when it i
knew that the measure could bring j
relief onl yto a small percentage of 1
home owners, and even in those cases j
only to individual mortgagees who,
might not be able to make a thoro-j
ugh analysis of the value of the bond,'
was a deliberate fraud. The act should j
be repealed.”
(Mr. Goldey’s article was submit-!
ted by The Nation to William F. I
Stevenson, chairman of the board of I
directors of the Home Owners’ Loan i
Corporation and the Federal Home
Loan Bank Board.?
Mr. Stevenson while not refuting or
answering Mr. Goldey’s definite and
critical statements in regard to the
prospects of lelief to be afforded by
I the Home Loan Act, makes the fol
: lowing rejoinder in part:
| “Congress did not believe that it
j would be wise for the government to
; endeavor to take over so vast a pori
' folio of mortgages ($20,000,000,000)
and drive all private capital out of:
the mortgage lending field. But it did
believe that some measure of relief
should be offered, by taking off the
market mortgages of distressed home
owners ,to the limits of the act, in
the hope that by so doing it would j
tend to stabilize realty and mortgage |
values It is unthinkable to
assume, as has been assumed by your
writer, that any large number of Am
erican citizens owning their own
homes will deliberately refrain from
paying their mortgage indebtedness
for the sole reason that a govern
mental instrumentality is the holder
of the mortgage.
“The figures quoted as to the ex
pense of the operation of the corpora
tion are so fantastic that they have '
the appearance of being deeliberately
exaggerated.. The corporation will op
erate through a State manager with
a small force of assistants ,who are
bring paid a remuneration that is
most reasonable for the services ren
dered ”
Expect Dramatics
As Fogleman Dies
(Continued from Page One.)
ernor Ehringhaus and tell his excel
lency what the solicitor thinks about
the case Mr. Higgins came.e but he
gave Fogleman no help. The prosecut
ing officer admitted his distress, his
despair over” the absolute
.[•■truth abotit the prisoner, but there
was no request for clemency in the
I case. The solicitor agreed that Dr.
Phillip Ray had quoted Mrs. W. J.
Carter, wife of the slain man, for
whose death Fogleman dies, and In
[ the quotation used the phrase that
[ Mrs. Carter did not know whether
f her husband’s slayer was black or
[' white, but “I believe she recognized
h Fogleman for all of .that,” Mr. Hig
f gins said. J
The refusal of either Judge Stack
or Solicitor Higgins to make any re
commendation left Governor Ehring
haus without the usual justification
for clemency. Both officers of the
court that tried Fogleman believe
thoroughly in his guilt and there ap
■ parently is no chance for him. Today
r HENEBkSOt; fN.CJ DAILY DISPATCH, THURSDAY, AUGUST 3, 1933
I observers of the case a sit developed
| were willing to risk good reputations
tor accurracy in guessing out the
I criminal mind that Fogleman will con I
I fess. I
! However, the reputed purpose of Mr.!
| Gwyn t o walk with his luckless client
changes the conditions of confession
somewhat. Mr. Gwyn is a lawyer. He
has the confidential relationship with
his client that makes impossible the
b. caching of <jsuch confidence. The
officers believe there was a second
and probably a third man with Fogle
man when the murder was commit
ted, and that the accused man may
be holding ou on a technicality.
The prisoner’s willingness to take 1
a life sentence and to stay in the
prison until the real murderer is un
covered, d[id not impress Governor
I Ehringhaus. His excellency saw weak
| ncss as well as strength in the pro-
Iposed compact xfith jthe conv?icited
man.
last minute confessions are quite
common the electrocutions (and
only a few times have there been
executions with prisoners holding out
to the last for their innocence. The
attorneys for Fogleman believe that
he was convicted by a hostile public
sentiment, but the doomed man never
has told the governor, Parole Com
missioner Edwin Gill or anybody else
where the prisoner was at the time
of the actual killing.
Fogleman’s life has been pronlonged
by tne governor and by the General
Assembly. While Mr. Gwyn was serv
ing in the long session the date set
for the death of Fogleman came and
went. Governor Ehringhaus allowed
the lawyer-senator to finish the leg
islative work before going back to ,
help Fogleman.
So far as the prison officials can
recall, only one or two lawyers have
before this time followed their clients
to the electric chair to be with them
to the very last. Most attorneys are
confessedly too soft to sit by and
watch their wards die.
New Kidnap Threats
To O'Connells
(Continued rrom Page One.)
world” all the details of the case if
Dan O'Connell, uncle of the abducted
youth, continues his silence.
Snyder declared that statements
made by District Attorney John T.
Delany were putting him “in a bad
light,” and that the family of John
J. O'Connell, Jr., could clear up mat
ters if they desired.
Private Concerns Build 21
of Them And Navy 16
(Continued rrom page one.’,
plan to have two subamrines con
structed at Portsmouth navy yards,
two destroyers at the Boston navy
yard, one light cruiser and one gun
boat, at ihe New York yards and
one gunboat at the Charleston, S. C.,
navy yards.
—an - ;
CHARLESTON NAVY YARD
TO BUILD ONE GUNBOAT
Washington, Aug. 3.—(AP) — Con
struction of a gunboat at the Char
leston, S. C., navy yard was included
in allotments made by the Navy De
partment today.
Shepherd Appeals
For Negro Codes
(Continue? rrom T"age One.)
the present on the proposal to deny
the moj-e menial workers the full
benefits of this code. “Your nation
ally known attitude of sympathy for
oil disadvantaged persons, irrespec
tive of creed or color, moves me
appeal to you now,” he says.
"I have been appraised that num
erous merchants and others who em
ploy workers have asked that the
generally accepted Industrial code do
not apply to janitors, elevator opera
tors, porters and similar workers in
public buildings. W|hile there may not
be a general discrimination against
colored employees because of their
race, it is well known that the great
bulk of these wage-earners come from
my people and J am carrying this
protest to your office. For,?of all the
people upon whom these economies
have been imposed there is none sb
little equipped for their ow ndefense.
and none weho so little, can give back
the pittance which they have 1 beep
paid. And I am asking that the head
of the workers of this country use
her great office ot see that the for
gotten black man does I not suffer a
discrimination so indefensible as this.
“I am hot advised as .to the details
and the scope eof the effort to with
hold the advantages of this code from
the great army or menial Negro work
ers. I fear the effort may extend to
many working centers and to great
numbers of our people. You and out
eat President have sensed salva
tion for our people by given them
employment at a living wage. Surely
the least advantaged of Amreicaai
workers are not going t 0 be penalized
for their defenselessness. It is not like
our great nation to endure 1 a condi
tion so palpably unjust and in
equitable.
“In all of the readjustments inci
dent to our efforts at national recov
ery ,the Negro has suffered more from
indifference ot his lot, I think than
from sheer hostility of .those who had;
remedial measures for him in their;
own hands. The schools have taken
their general cut in operating ex
penses but i nno departments of edu
cation have there been such racial and
rigorous economies as those visited
, upon our Negro teachers. The pre
paration and equipment for teaching
the standards and character of the
teachers must be as high as they are
i among the ewhites, but the compen
! sation falls far below the level. In
i all conscience this is bad enough, but
it could be worse if our hard-work
ed janitors and housekeepers should
I be further penalized by being denied
the protection of this code.”
Secretary Perkins always has been;
a strong friend of the colored peo
ple and whether she has any direc-
I tion over the complaint it is reason
ably guessed that she will have an
expression on the subject if the com-
I plaint made by Dr. Shepard seems to
I touch a general 'situation.
Strife In State With Most Strikes
By JACK KEENE
Harrisburg, Pa.., Aug. 3—(Central
Press—The “New Deal” . has brought
about a surprising eifaate of affairs tn
Pennsylvania, the Hand of the Mellons
the open shop and th e “blood and
iron” polite.
State troops are being employed on
the side of the workers. I n ei’ferit,
that is w’haiti is happening im the
Brownsville Strike area where a de
tachment of the 112th Infantry is act
ing under orders of Gov. Gifford Pin
chot in overruling, the deputies that
Sheriff Harold Hantntev of Fayette
County refused to withdraw from
participation in the dispute between
mine operators and strkiinlg miners.
More lover, itlhre efforts that are being
ntuade to restore industrial peace in
'this state, of which three.fourths of
all the current strikers the entire
country are residents, are in the hands
of three women whose past records
show them t|o be sincere partisans of
the working classes—Mme. Secreatry f
Labor Frances Perkins ,of President
Roosevelt's cabinlet; Mcsis Chatriottie
Carr, the state secretary of labor; and
Mrs. Gifford Pinchot, wife of the gov
ernor. '■ i •
Mrs. Pinchot has taken a militant
part on the sideiof the dennerbucket
carriers siince the. efforts of the Ame
rican Federation of Full-Fashioned
Hosiery Workers to complete unioni
zation of ml'lCs within: the state preci
pitated .wideispiead lookouts and
troubles.;; The uni on beheves that it
has Secretary of Labor Perkins on
its side because the NR A recognizes
collective • bargaining of the workers
as the basis,of worker-employer deal
ings. There is nto doubt of the gover
nor’s wife’s sympathies. After she
marched as a picket : i, n a demonstra.
titon alt Allentown she was crili’fciz?d a.--
■a troublemaker, but not daunted, she
went to Lebiamcn take active part
iin demonisltrations of strikers there.
The governor’s wife is credited with
having arranged the appointment cf ’
Miss Carr as the state labor secretary, I
when the male head of the depart- j
mient’ protested that Miss Carr, a mem •
ber of hds', staff was creating trouble !
between employers and labor by her
efforts t oforce through a minimum
wage law. The governor's answer
was to namle Mies Can- as head'of the
department. t,
Miss Carr came to Pennsvlvania i
Killian V MB
» W j • I
; Really, how' can so fine ■
a cigarette cost so little? :
Well, you folks have a lot to do with $100,000,000 worth of the world’s 1,/I
it. You, and the millions of people choicest tobaccos. Truly, we could IBW ’• /
;like you, who prefer Luckies, to not tell you how much Luckies * W i
whom Luckies are a personal thing. would cost if only a few of them were
Your approval enables us to buy our sold. Frankly, it is your faithful and ' V / /
fine tobaccos and produce otir ciga- overwhelming patronage that en
rettes in great volume; For instance, ables us to offer you the quality of /
instead of buying from hand to fine tobaccos and ' the purity 0f ..-j
mouth, we have a reserve of over "Toasting”—at a very moderateprice!
4 ZZ I x. « Copyright, 1933, Tha
■ I g / fl 1 I American Tobacco
- • because Its Enacted ? <—>
Women Seek Penn Strike Solution
H'
«• -daBI I
Efforts directed at restoring industrial peace in Pennsylvania where
current strikes account for three-fourths of all the men and
riaS 15 W °‘ k ln n th f. S -» are being nushed by three women
who in the past have usually lined up on the side of the workers-—Mme
Secre.ary of Labor Frances Perkins (top), who is shown getting workers’
opinions m steel mill at Pittsburgh; Mrs. Gifford Pinchot (below), wifo
of the governor shown marching in a protest paraae with striking hosiery
uoikers; and Miss Charlotte Carr, newly named state secretary of labor.
a former New York policewoman.
(Central Press)
r wit!h a reputation made while work
ing under the direction of Frances
Perkins in New York state. She has
been a militant social worker for 18
■years, following a Vassar educatioin
and a start as a poll ce-wman on a
jnight beat between- the wharves of
Brooklyn. This led heir into 'a career
paralleling Mias Perkins’.
Miss Carr has beein using the burly
erm she developed as a politeewoma'n
with full force tai dealings with em
ployers found to be promoting sweat
shop conditions. She resorted Ito pro
secution under federal Mann Act sta
tutes to curb an employer who forced
ill.paid girls to accompany him on
■trips with threats of disciharging
them. She thought use cf Na
tional Guardsmen Was timely when
Sheriff Hairodd E. Harltney'of Fayette
Cunty refused to withdraw the depu-
PAGE THREE
ties who were breaking up miners’
demonstrations, and James J. Dav.’is,
Ithe Harding-Coolidge secxeta>ry of la,
bbor were in office, they gave no in
dications cf partisanship sympathies
ywith the workers of their home fetate.
Mme. Secretary Pei kins gave striking
evidence that she doesn't intend to get
her iniormiaticin regarding working
conditions from anyone but the wnge
earaers themselves on h:-,r trip intq
Pennsylvania on which she went intel
the steel mills and cither industrial
plant# to sit down with the rank and
■file dinner-pail loiters and get their
viewpoints. /
Naturally the Grundy organization,
The Pennsylvania Manufacture!s’ As
sociation, which was so potent am in
fluence 'in tariff making and wage leg
islation, is siitb’ing up and taking no
tice. It is fearful that 'he NRA
means a lot more than national in
dustrial recovery.
Getting what you want is better
than having what you want.
FORECLOSURE SALE.
By virtue of authority vested in.
the undeisigned as trustee in a cer
tain deed of trust executed by Ella
Biame and Bertha Brame and re
cored in Book 82, Page 113. Default
having been made in the payment of
the note therein secured, at the re
quest of the holder of the same I will
offer for sale at the courthouse door
in Henderson on the sth day of Sep
tember, 1933, by public auction, the
following described land:
Begin at a stake corner of lot No.
3, thence N 87 1-2 W, 19.55 chns. to
a stone- corner of lot No. 4, thence R
4 1-4 W, 5.40 chns to a stone, Ed
wards corner, thepco S, 70 W, 7.47
chns. to a stone Edwards corner,
up the creek S 68 1-2 W, 5.10 chns.
5 64 W 3.75 chns. to the Ford of thn
creek, thence along the old Bute road
N 88 1-4 E, 4.15 S 77 1-2 E, 1.85 S.
69 E, 2.88 S 73 E, 1.60 S 70 E. 3.50
S 79 E, 1.50, S 76 1-2 E, 4.00 chns.
to a stone, corner of lot No. 2,thence
N 4 1-4 E, 8.90 chns. to a stone, cor
ner of lot No. 2, thence S 87 1-2 E,
14.64 chns. to a maple on the? Hen
derson road, thence along said road
5.50 chns. to the beginning, contain
ing 20 acres, as shown by survey of
Thomas Taylor in the division of Sam
Brame land. See deed of Isham Brame
and others to Bertha and Ella Brame.
This 3rd day of August, 1933.
A. A. BUNN, Trustee.
Oxford Steam Laundry
and Dry Cleaners
Phone 47
Quality —Service
1
i ’(
l f