On December 12 Japanese bombers sank the clearly marked U.S. gunboat Panay and three Standard Oil supply ships in China’s Yangtze River, killing two Americans and wounding thirty. At the time, Japan was at war with China, and the American vessels were on the Yangtze to evacuate American officials. The news of the sinkings angered Americans, and Secretary of State Cordell Hull demanded redress. The incident ended when Japan apologized, promised full indemnity, and agreed to punish those responsible.

“You should have heard the howls of warning when we started making a fulllength cartoon,” Walt Disney said years after completing the ground-breaking Snow White and the Seven Dwarfs . “It was prophesied that nobody would sit through such a thing. But there was only one way we could do it successfully and that was to plunge ahead and go for broke—shoot the works.” Disney and his 750 artists did just that from 1934 to 1937, spending not the projected $150,000 but $1,500,000 to create the first seven-reel cartoon feature. Out of some 1,000,000 drawings, 250,000 went into the finished work, and on December 21 at Los Angeles’s Cathay Circle it was proved that “Disney’s Folly” was, in fact, a masterpiece. During its first three months in the nation’s theaters, more than 2,000,000 people watched the film. Today Snow White and the Seven Dwarfs has grossed $383,000,000 for Disney.

The Carnegie Institute closed its annual international art show on December 5, having exhibited 407 paintings from thirteen countries. The work of artists of radically different persuasions was hung together—Georges Braque with Salvador Dali beside Grant Wood. Carnegie’s fine arts director, Homer SaintGaudens, had returned recently from a trip to Europe to declare, “There are no geniuses or masters in Europe today.” But the show’s judges gave seven of eight awards to Europeans, including the top prize of one thousand dollars to Braque for The Yellow Cloth .