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The failures of the Corn Products Co., The American Malting Company, the U. S. Realty Co. and the New England Cotton Yarns Co. were the direct results of unwarranted payments of dividends. The U. S. Leather Co., the National Cordage Co., the National Salt Co., the Consolidated Cotton Duck Co., and the International Cot DIVIDENDS Ton Mills Corporation, were all seriously weakened by payment of dividends at the expense of their cash position. In the case of the American Malting Co., it was proved that the directors must have declared dividends without having before them any statements of earnings. This same thing probably is true also of other corporations. The great fluctuations in industrial earnings are the chief argument against the use of bonds by industrials and in favor of conservatism in paying dividends. In 1908 the Westinghouse Co. had gross sales of $20,000,000 And a deficit of $1,000,000. In 1909, gross sales of $30,000,000 and net profit of $3,000,000. These fluctuations involve a strong tendency to borrow on short-term notes or even to use short-term notes as a means of raising money with which to pay dividends. There is sound reason for borrowing on short time in order to meet fixed charges inasmuch as the insolvency and reorganization of the company, even though it be only temporary, involves a severe blow to its credit and trade. For instance, after the panic of 1907, the General Electric Co. had a loss of 25% in its business and the Westinghouse Co. 37%. The explanation seems to be in the failure of the Westinghouse Co....