First Fund

A month ago President Roosevelt recommended that U. S. railroads and utilities establish sinking funds to retire bonds before maturity. Bets were that President Daniel Willard of Baltimore & Ohio would be the first to fall in line. But last week another railroad man, who also keeps his tracks to the White House clear, came forward with the first plan. President Fred Wesley Sargent of Chicago & North Western informed the I. C. C. that he would: 1) put nothing into a sinking fund until his company earned its fixed charges, 2) thereafter set aside 3% of his first $2,500,000 net profits, and 4% of the next $2,500,000, and so on up to 20% on all profits over $20.000,000. In 1929 C. & N. W. earned $15,599,000; in 1932 it lost $11,216,000, last year it lost $7,875,000.

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