Investment Trusts

When he bobbed up in Wall Street two years ago with control of a few investment trusts no one knew very much about Wallace Groves except that he had made some money in Baltimore in a chain of small loan companies. His Yosemite Holding Corp. controlled Chain & General Equities which in turn controlled Banc-america-Blair-sponsored Interstate Equities. He bought into Distributors Group, Inc.. one of the biggest fixed trust selling organizations in the U. S. He bought into Allied General which was both a trust and a selling organization. Late last year he formed Equity Corp. to take over Yosemite, the tail that wagged his mongrel dog. By this time Wall Street was aware that Wallace Groves was about 40 and a onetime lawyer. Last week when he sold control of Equity Corp. it learned that he had no plans for the future. Wall Street guessed that that might be all it was ever to know of Wallace Groves.

It was different with Equity Corp,. for that had been bought by David Meriwether Milton, a young lawyer who married Abby, daughter of John Davison Rockefeller Jr., shortly after he defended her on a speeding charge. He works for the comfortable old firm of Satterlee & Canfield but like his father-in-law his outside interests are real estate and finance. About the time that the father-in-law was launching Rockefeller Center, David Milton launched a swank East River apartment house for which Mr. Rockefeller loaned him $1,000,000. And about the time Mr. Rockefeller woke up to the fact that he was the biggest stockholder of Chase National Bank, David Milton bought an investment trust. It was a nice little trust with $400,000 in assets. Last January he picked up another. By acquiring Equity last week he became president of a $7,500,000 concern with the simplifying of Wallace Grove's ornate structure as his chief job.

Climbing steadily with transactions running well over 5,000,000 shares a day the stockmarket last week reached the levels of October 1931. Reports of Washington apprehension, a Congressional revolt and sluggishness in commodities dulled the pace at the end, but three months of the New Deal bull market had wiped out nearly two years' losses. None were happier than investment trust managers who had helplessly watched their portfolios shrink to the point where assets did not fully cover the liabilities of their preferred stocks and bonds, let alone their common stocks. By last week most trusts were well above water, and managers devoutly hoped that the market would hold at least until June 30 (half-year statements) so that once again they could sing a song of success to their patient stockholders.

Estates of four Chicago tycoons which had been practically erased by slumping stocks and taxes were last week back to their former importance. Those of William Wrigley Jr. (gum) and Joseph Leiter (coal) were larger than when they died. Richard Teller Crane Jr.'s plumbing fortune had doubled to $10,000,000. Julius Rosenwald's (Sears, Roebuck) had jumped $20,000,000 since the inventory was filed.

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