Full text of Commercial and Financial Chronicle : April 2, 1959, Vol. 189, No. 5834

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ESTABLISHED

LS39
ITY,
MICHIGAN

U N I V £ K S

OF

3 1959
BUSINESS ADMINISTRATION
LIBRARY

Reg. U. S. Pat. Office

Volume

Number

189

5834

New York 7, N.

50

Price

Y., Thursday, April 2, 1959

Cents

Copy

a

EDITORIAL

As

Analysis and Forecast for
19S9 and the Business Cycle

See We
It

Ever since its

orginal presentation last January,

By REUBEN E. SLESINGER

Democratic party have "been
vociferous in their assertions that the President's
leaders of the

the

Professor of

was

rate of

claimed

the year,

indicative of genuine

unemployment

will

end

GNP

worffl-wide adpetroleum refining and chemical industries'
growth rate; reviews latest petrochemical activities by
successful oil companies; cites some of the petrochem¬
ical building blocks and intermediates which are bridg¬
ing the gap between chemical and fuel production; and
doubts gas-turbines and free-piston engines will signifi¬
cantly affect the conventional engine in the next decade.
The writer expects petrochemicals to constitute 29% of
all chemical production in 1959.

The

of business

revival

mid-1958

will

continue

Introduction

activity which began during

throughout

1959

will

employment

-

not

was

chemicals"

so

was

can

ing

—

or

the improvement has

distance

levels

peak

larger than the guesses of experts at the other
end of Pennsylvania Avenue with excellent rec¬
ords of tax estimation. And it is a fact, too, that

travel

to

will

economy

outlays the President is asking Congress to appro¬
priate are in at least one important instance not
included in the budget as proposed by the Presi¬
dent for the year ended June 30, 1960. So well

Dr.

R.

E.

^various

were

dustry
the
very

H.

Senator

—

\

DEALERS

on

page

chemical revolution.

continues to be somewhat

sluggish and there is little evidence that its total will

Continued

16

on

page

34

early 1950's it remained but a
small segment of the chemical

♦Based

on

of

recent

a

the

Today projects are being planned
Continued on page 28

talk by Mr. McGrath before the South Jersey
Chemical Society, with slight modifications

American

by the author to bring it

up

to date.

are

afforded

a

sues now registered with the SEC and potenRegistration" Section, starting on page 38.

complete picture of i

tial undertakings in our "Securities in

.

State/Municipal

U. S. Government,

and

Housing.

State and

Municipal

STATE

AND

Lester, Ryons & Co.

MUNICIPAL

623

So.

IlAnover 2-3700

Members Pacific Coast Exchange

Offices in Claremont, Corona

MONTHLY

LETTER

m

30 BROAD ST., N.

Burnham and Company
MCMBCRS NEW

15 BROAD
CA»UC:

YORK AND

San Diego,

OF NEW YORK

Inquiries Invited
California

STREET, NEW YORK 5,

N. Y.

•

Dl 4-1400

Bond Dept.

Teletype: NY 1-708

y..

New York

Net Active Markets Maintained

Distributor

To Dealers,

Members
New York Stock

Correspondent—Pershing & Co.

Exchange

4%

Principal Properties
Block

Inquiries

American

Invited

Bonds due February 1, 1981
Non-Callable

Principal and
»

Canadian

'

interest
Dollars

STREET

NEW YORK 4, N. Y.
FIRST

CANADIAN

Stock Exchange

BROAD

gouthutt&t COMPANY

DEPARTMENT

DIRECT

WIRES TO MONTREAL

AND TORONTO

Goodbody & Co.

DALLAS




•

PERTH AMBOY

For

in

115 BROADWAY
MEW YORK

1 NORTH LA SALLE ST

CHICAGO

Municipals

(U. S.)

Associate Member of American

Stock Exch.

MUNICIPAL BOND

IBank of America

Exchange Place, New York 5, N. Y.

Tel. WHitehall 4-8161

Tele. NY 1-702-3

*

DEPARTMENT

NATIONAL

40

'

California

only.

Domiaioti Securities
corporation

MEMBERS NEW YORK STOCK EXCHANGE
"

BRIDGEPORT

payable

/

Teletype NY 1-2270

25

Company

(Guaranteed by the Government of Canada)

Price 91.25

^

BANK

,

$500,000

Banks and Brokers

United

1832

ESTABLISHED

—

Chase Manhattan

Southern

Canadian National Railway

T.L-Watson&Co.

T

on

Securities

TELETYPE NY I-22B2

Dealer

InvMiment
»'***

Santa Ana, Santa Monica

AMfTRICAN STOCK EXCHANOCS

COBUItNHAM

HIS

the

Pasadena, Pomona, Redlands, Riverside,

THE FIRST NATIONAL CITY BANK

bond department

BOND DEPARTMENT

del Mar,

Encino, Glendale, Hollywood. Long Beach,

BANK

•

Associate Member American Stock Exchange

view

burnham

CORN EXCHANGE

Underwriter

Members New York Stock Exchange

BONDS

the

Housing Agency

Bonds and Notes

California

CHEMICAL

^

Public

Angeles 17,

Hope Street, Los

Securities
telephone:

Europe

However, until

SECURITIES NOW IN REGISTRATION—Underwriters, dealers and investors in corporate
securities

in

Public

The in¬

Western

industry. With millions of barrels of
inexpensive Middle East oil being
brought into Europe each day the

McGrath

G.

Section

Continued

to

European petrochemicals industry quickly brought about
a

private business spending

spread

after World War II.

re¬

sponsible for and have been pro¬
pelling the recovery to date — in¬
creased government spending, a high
level of construction, and diminished
inventory liquidation.
One factor—

Slesinger

of the refinery gas stream.

industry
will/ be
improvement in the
stem mainly from a

of factors that

concurrence

a

chemistry recognized the possibilities
existing in utilization of a segment

considerable

a

before

of

The

reached.

as

optimistic fac¬
Nonetheless,

tors that loom for 1959.

at least estimates are much

student of these matters

basic

recently as 20 years
an infant industry

at

that—only an Ameri¬
industry: Today it is fast becom¬
world-wide industry. Its origin
even

was
associated' with petroleum re¬
fining in the United States. Certain
oil and chemical companies inter¬
ested in the potentialities of olefin

steel, and continued high levels in
are

as

only

was

—and

liquidation trend, improved activity
construction

it

ago

output and
make noticeable
as

gains.
Increased sales of new auto¬
mobiles, a reversal in the inventory

recognize it—that we are not- even on
our way to a balanced budget. It now appears to
be a fact that tax collections have been seriously

when the word "petro¬

many years ago
unknown. Even

'

in

•

in

vance

is

It

not fail to

a

which the industry is outpacing the now

Doubtful that

$500 billion

reached, Dr. Slesinger expects full employment in 1960,
accompanied by upward rising price level and followed
by a year with characteristics similar to 1958. Turning
to the problem of the business cycle, the writer singles
out variation in employment of one-third of the labor
force for mechanical cause of instability, and prescribes
alternations in government demand to counter business
fluctuations. Economist analyzes the specifics determin¬
ing the scope of national output; comments on monetary
policy and semantics of the word inflation.

The fact remains—and the rank and file must

informed

recovery..

unless

growing opportunitiesv in

enormously

uncovering

h

Kellogg Co., New York

petrochemicals, Mr. McGrath states the rate of expansion /
is such as to presage a fast growing and profitable;
future. The chemical engineer discusses the extent to /

an end of the year GNP
$480-$485 billion, averaging out $473 billion for

to discredit him.

over-estimated

In

Economics, University of Pennsylvania

Pittsburgh economist foresees

not really in balance. The balance
by the President, they said, was "syn¬
thetic" on the ground that charges which should
go against it were shunted to another year, and
tax estimates much too high. There was and is
much truth in these accusations, of course. Just
how much, the future will disclose. In any event,
the opposition is not interested in balancing the
budget in reality, but rather in taking many steps
which would render the accounts when they are
finally rendered much more out of balance than
they would be if the President had his way. In
point of fact, many of the Democratic leaders
scorn prudent fiscal management, and find virtue
in many varieties of financial recklessness. The
President seems more interested in" a truly bal¬
anced budget—so far as any of them are so in¬
terested—than do those who oppose and endeavor

budget

By HENRY G. McGRATH*

•;

Sales Executive, M. W.

300

J!VSings ASSOCIATION

Montgomery St., San Francisco, CaJif.

.

2

The Commercial and Financial Chronicle

(1522)

For Banks, Brokers,

The Security I Like Best

Dealers only

If it's Over-the-Counter

Tiy "HANSEATIC"

participate and give their

reasons

for favoring

(The articles contained in this fornm

Because you can

be

sure

of

Speed

more

than 400 OTC Issues

Hew York Hanseatic

Corporation
Established
Associate

American

WOrth 4-2300

Exchange

Teletype NY 1-40
•

CHICAGO

PHILADELPHIA

•

SAN FRANCISCO

Principal Cities

to

Seaboard

Finance

tronics

e c

wh ich

are

basically

40

mystery
issues

it

Phone: WHitehall 3-7830

Teletype No. NY 1-2762

Trading Interest In

This

American Furniture

Basset! Furniture Industries

1954

was

lion

and

STRADER anil COMPANY, Inc.
LYNCHBURG, VA.
Private

Wire

to

New

TWX LY 77

York City

Finance

a

third

little

for

largest

above

last

$29 mil¬

well
The net before

year

was

$57 million.

hasj advanced steadily and

consistently for the past 11 years
and the net income figures follow
the general pattern. Earnings per
share have steadily mounted.
fiscal

ended

Sept.
30, 1958, the company added 102
branches to; its operations, par¬
tially through acquirement of of¬
of

these

year

another

paid for in stock. For
the company earned
$1.47 per share which is ample
coverage for the $1.00 dividend
(cash)
andr it has become the
practice of the company to pay a
year

stock

dividend

in

May

of

2%.

This stock dividend has been de¬
clared
and
is payable May
11,

going

ex-dividend

April 6. The
quarterly cash dividend of 25c is
payable April 10 and the ex-

dividend,
Active

in

the

on

Sreewe<n«iCompam^
ESTABLISHED

37 Wall

1930

available

in

current

mar¬

are

the

looked

present time earnings
at in connection with

potential

as

dividends

price-earnings ratios of

HAnover 2-4850




,

im¬

;

obstacles that must be

before

beryllium

too brittle for many

now

—

must await the

fabrication

are

A.

Richard

In

the

are

case

16

tirqes earnings and that

exceptionally conservative from
comparative standpoint.
Dividends ; are of little moment

large: traders because they
are
seeking capital gains, while
the law still permits
them, rather
than current
yields, but for the
average stock buyers now
coming
into

ing

the

market

as

an

alloy

to which it gives greater
hardness, fatigue resistance and
strength. To date, the commercial

beryllium

copper

has

been

primarily responsible for the
growth of the beryllium industry,
demand

for this

alloy is

numbers,

should

in

ever-increas¬

yields

are

be

very
important,
this is another reason for

and

upon

Seaboard

Finance

with

Future expansion may also stem
the expanding use of pure

from

fa¬

oxide, a hightemperature ceramic. A new use

"•;*

a

Company is actively

basic

are

danger signals
in the general
economy and while
many

as

beryl¬
oxide
moderators and

beryllium

neutrons.

raw

Another

extracted

and

beryllium

material

then

of

Leading factor in the industry is
Corporation, which

The Beryllium

methods

of

ore

reduc¬

Large
beryllium

in

the

" alloys

reserves

are

United

is

was

production

atomic

In

decided

1955,
to

from

however, the AEC

purchase

its require¬
private industry.

Philadelphia 2, Pa.

Broadway

N. Y.

LO 8-0900
ATT Teletype PH 30

CO 7-1200

s0\)R W0f.

to

The

utilizing these de¬
being actively explored

'^vihg*

by the Company and governmental
agencies.
Meanwhile the supply

-

energy
government-owned facili¬

in

ments

for

115

New York 6,

of low-

believed
States.

Although sales
of
Beryllium
The
second
largest and only Corporation have quadrupled since
1949,
other, existing major factor in the
rising from $3.5 million in
industry is Brush Beryllium. The 1949 to $16 million in 1957 and

The first large-scale

1914

1529 Walnut Street

possibility of
posits

beryllium alloys.

the major portion of its
output to
U. S. Governmental
Agencies.

Established

or

tion, alloying, hot and cold work¬
ing of alloys, and built an indus¬ picture for commercial grade beryl
try out of beryllium copper. It appears favorable and - sufficient
now markets a
comprehensive line to meet the contemplated expand¬
of
beryllium copper and' other ing demand.

done well and sells

Keyes Fibre Co.

converted

metal,'

grade
exist

.

the

ancl India.

ulated keen interest.

Stouffer Corp.

a

ture where

its lightness, stiffness
high melting point have stim¬

Richardson Co.

many

beryllium industry is beryl,

into

•'

solicitation for

or

particular securities-.

A Continuing Interest in

pursu¬

di¬
rections and the technical organi¬
zation is being expanded.'
The

offer

any

BOENNING & CO.

portion of this vast market.
The

«

and

'

an

Fischer & Porter Inc.

high purity oxide, for. commercial
uses.' The main
sources
of beryl
ore
are
South
America, Africa

ties.

There

and

beryllium

is not

orders for

.

major outlet for beryllium metal
may appear in air frame manufac¬

of

Telephone: BOwIing Green 9-0187
This

beryllium metal
as
presently produced does have
some application in air frames.
In
many
instances components can
be produced
from powdered
pressings.
Therefore, the Com¬
pany does have access to at least

metal and beryllium

and

61 Broadway, New York 6, N. I.

the subjects of in¬

ing research activities in

increasing.

company has

\

our

Nomura Securities Co., Ltd.

Nevertheless,

application has been

pioneered

-

Monthly Stock
Digest, and our other reports,
that give you a pretty clear \
picture of the Japanese 'J1-';.
economy as a whole.
~

Stern

to copper,

of

-

sponsored by the Air

now

Force.

main

employed

Bankers

IN JAPAN
Write for

tensive research and development

projects

beryllium,

reflectors

Investment

Opportunities Unlimited

development of ap¬
propriate techniques, Fortunately
the problems of brittleness and

of

metal

&

Broadway, N.Y. 6 COrtlandt 7-5680

air

conventional metalworking forms
rolled sheets, forgings, etc.,—

One of these

bulk

speculative stocks

vor.

Tel.:

the

the

Seaboard Finance this ratio is

about

a

and

looking

St., N. Y.

continuing

1

Moreover, its availability in

uses.

era.

the

.over¬

is

among

Request

metal is

metallurgical

and

reflect

are

Brokers

111

•

ele-

of

been

frame components reach the stage
of quantity production. Beryllium

necessary to
the specialized

success

Co., Ltd.
Tokyo, Japan

illus¬

made

and future earnings are ex¬

come

There

properties

is

been .well

Hazleton have

' pected to

contrib¬

whose

at

of

at¬

by
engineers.
It now ap¬
that the production difficul¬

overcome

uted specific

this

has

calculations

ties

which

demands

The

turn,
freely

is

*Memorandum

have

airplane,
in

Affiliate

Yamaichi Securities

provid¬
air

Company

York, Inc.

beryllium metal
missile and rocket

provement.

of

use

field.

write

of

structures

new

have fostered

ments

structural

trated

pears

technologies
the

also

materials

During the past two decades the
requirements of the military have
propelled the world into the elec¬

many rare

is

to enter the

are

of

Common

The Beryllium Corporation

of

of New

surplus billet

lium

something fantastic.

AMERICAN OIL

San Diego, California

ments

use

Hazleton

tractiveness

ex-

Securities

now

ing the capacity
frame

The

or

Yantaichi

Out¬

is in the atomic field where

present

5.8%, and a 5.8% re¬
well-pfotected, is not too

of favorite

TEXAS

cilities.

for

age.

Call

planning to in¬
existing fabricating fa¬

its

crease

STERN

tronic-atomic-space

STOCKS
For current information

years.

will be about

to

price-earnings ratios rather than

Common

thaiu^ffiany

acting require¬

x

37,500

purchasers for the next 12 months

At

REFINING

better

japanese

cur¬

*

Company to

capacity. It is

offices

Pro¬

shake¬

1958, to deliveries of
annually for five

the

branch

our

encoun¬

the

min¬
eral from which beryllium oxide

yield

kets.

SUNTIDE

it

were

Interest in beryllium metal

is

NY 1-1557

Mobile, Ala.
Direct wires to

side the nuclear field has allowed

Security Analyst

and *

company

were

dividend date is March 16. At the
current price for the stock, and
including the value of the stock

Over-the-Counter Markets

like

yield

problems

which extended

HAnover 2-0700

New Orleans, La. Birmingham, Ala

Pennsyl¬

Company will
receive compensation approximat¬
ing $1.8 million.
' "A

should
business

Its

the

A. RICHARD

small

above

the

de¬

glamorous issues, which sell
hope.

Co.

Hazleton,

pounds

more

taxes

that

Commonwealth Natural Gas

company
to expand.

growing and

on

at

,

IB Rector St., New York f, N. Y.

For this cutback the

ear¬

aggressively

I

plant

30,

a

that

eral.

nomenal, even in this field.
In
1949, it did a volume of loans approxi mating
$87.5
million;
whereas, for the fiscal year ended
Sept. 30, 1958, this figure had ad¬
vanced to $395.73 million.
The
gross income of the company in

fices

Life Insurance Co. of Va.

the

greater

Steiner, Rouse & Co.'

1958. The AEC reduced
the billet contract, effective June

their

and

managed
is

Seaboard

is

still

marks of a well and
continue
Merritt F. Beal

loan company and its growth over
the past 10 years has been phe¬

In

—S-2S27—

f
a

on a stock. That is my
for
liking the
common

of

in

..

Bought-r—Sold—Quoted

well into

be

become

stringent

are

(Delaware).

Y. Security Dealers Ass'n

LD 39

a

looking

stock

when times

do

Seaboard has the statistical

reason

reason

they should

f

a spe¬

earnings

mand.

demon¬

o

what

more

services

has

over

cial

The Company built

fashion, but high prices" vania, to produce this metal.

of

to

little

Growth,
however,
way.

period.

Extravagance is in daily prac¬
tice, debt is not feared and thrift

able

any¬

favorably

Exchange Place, New York 5

deliver to the Commission 100,000

pounds annually of nuclear grade
beryllium billet for a five-year

take into consideration.

dication

Louisiana Securities

Members New York Stock
Exchange
Members American Stock
Exchangs

Beryllium Corporation, was sub¬
sequently awarded a contract to

down period. Deliveries were
tailed which depressed

to

.

for Banks and Dealers

completely out of step with com¬
sense and entirely out of line
so
far as the conventional yard¬
sticks by which we judge values
are
concerned, still these are facts
which the
prudent man should
mon

be ignored.
The fact that small
loan companies have flourished in
times of prosperity is a fair in¬

1

for

Securities

ard Stern, Security Analyst, San
Diego, Calif. (Page <2)

levels

tered

Members

Unlisted

at

—

Rich¬

selves warnings which should not

sound

brokerage sendee

are ;

Corporation—A.

duction

period
time,
is

a

Beryllium

street and that

one-way

quotations

(Del.)

without justification are in them¬

been

INC.

a

Co.

is out of

strated

S. WEINBERG,
GROSSMAN

is not

Finance
F.

especially is

where

& CO.

Company (Delaware)

it is definitely unpopular to men¬
tion the fact that the stock market

many

Alabama &

Beal, Analyst, Peter
P. McDermott & Co., New York
City. (Page 2)

.

Present-day stock market think¬
ing gives primary consideration
to growth. This is about the only
way
to justify many prevailing
prices and~

e

BOSTON

Wires

Chicago Board of Trade

chemicals and

1920

Member

Stock

Members: New York Stock Exchange,
American Stock Exchange and

applied

120 Broadway, New York 5

in all

as an

New York City

Primary Markets in

Render

be regarded,

Analyst, Peter P. McDerrnotl & Co.

Nationwide Wire System

N.

to

Seaboard
Merritt

to

Participants and

Their Selections

particular security.

be, nor
offer to sell the securities discussed.)

MERRITT F. BEAL

Experience

Private

they

are

a

intended

not

are

Thursday, April 2, 1959

.

.

This Week's

Forum

A continuous forum in which, each week, a different
group of experts
Km the investment and advisory field from all sections of the
country

...

.

about $14.5 million in

1958,

Over-the-Counter

Quotation Services
for 46 Years

earn¬

ings have not grown correspond¬
ingly, This is due to a number of
reasons,

one

of

which

discussed

in

Hazleton

operation.

to

connection

has

been

with

In

the

National Quotation Bureau

addition

Established 1913

increased research

ciation

and depre¬
charges/ earnings in 1957

46 Front Street
CHICAGO

Continued

on

page

5

New York 4,N.¥.
SAN

FRANCISOO

,

Volume

Number 5834

1$9

.

.

The Commercial and Financial Chronicle

.

(1523)

3

\s

J N

Chemical Industry Prospects
By RALPH W. II. GEER*

I) E X
r

Articles and News

Vice-President, Laird & Company Corp., New York City

Reversal of the below-average ratio of chemical shares to the
market, prevalent since 1955, is predicted by Mr. Geer in his
analysis of favorable factors presaging dramatic profit gains for
most companies. In taking a longer term approach, and assum¬
ing increasing capacity operation and good general business,
the Wall Street Underwriter-dealer envisions substantial

Page

Analysis and Forecast for 1959 and the Business Cycle
—Reuben

<

E.

Slesinger___

..Cover

:

FIRST IMPRESSIONS
•

Incoming Tidewater—Ira U. Cobleigh______

5

.

Inflation Is Unpopular and Can Be Prevented
—John K. Galbraith

Bring

g

;

closer to reality.
several companies that

profit

'Will Business Be Too Good?—Raymond Rodgers

respective quality
shares, in gen¬
eral, might well be market favor¬
ites in the next 12 to

T believe

this to be true because

for' the

time

for

first

in

Obsolete Securities

groups.

Outlook for

new

^facilities, there is a

siderable

of

" amount

business

general
busi¬
ness
condi¬

the next 12-18 months.*

conditions

con¬

—Edgar

>

tions

"permit

the

—Robert

at

dustry

personnel which, was
the lush early postwar
Certain random picked
companies illustrate this point.
Du
Pont, -for example, reduced
Jbeir
number
of
employees in
1958
nearly 6,000, or some 5%;

in¬

tiofls

are
an

on

145-46

Ralph W. H. Geer

Production

Allied

estimated
the

for

in

added

opera-

based

FRB

Index

in

of

average

Industrial
1959

Chemical

employment
Powder 7%;

com¬

a

with the 134 average for
1958, and assumes that this index

pared

their

cut

Ait

manufacturers

trend

of

general

(1)

efficient
cost of

below- average relationship of
shares
to
the
general

specific

reasons

by

cars

much

as

statistics

Ellis

T.

J.F.Reilly&Co.,Inc.

17

Members Salt Lake

and

Abroad—Hon.

E.

Canada

on

Fulton

D.

1

20

Olgby 4-4970

than

George Romney to Address New York Financial Writers______

Salt

5

to

v.

Denver &

Lake

City

New Law Requires Salesmen of Securities Firms in New

State

York

to

Register

10

_____

TraidCorp.
■

''....

■■

,v

$

,

.

i■J

'

Permachem

Regular Features
As

We

See It

1

(Editorial)

Ling Electronics

Cover

'

Bank

and

Insurance

Stocks.-—-

Coming Events in the Investment Field

———

12

Pacific Uranium

48

Metropolitan Broadcasting

Dealer-Broker Investment Recommendations

"A"

8

Einzig: "The Short-Sightedness Involved in Granting Credits

to U, S. S. R."

J

—

the

18

Ahead of the News—Carlisle Bargeron

From Washington

Singer. Bean

8

Indications of Current Business Activity
Mutual

45

Funds

——

__—

&

46

mackie,

NSTA
'

$otes

:

—

—

—

Teletype NY 1-1825 & 1-4844

12

Direct Wires to

24

News About Banks and Bankers—_______

San Francisco

Observations—A.
'

,V

*

.

'

'>

~

'

Wilfred

May_________—

——•

4

—

Our

Reporter

Our

Reporter's

Government^

on

1—

Dallas

Los Angeles

Cleveland

Philadelphia

J

-

INC.

40 Exchange Place, N. Y.

HA 2-9000

million

100

savings have been effected
the elimination of obsolete
plants' and processes as well as
the rehabilitation of old plants. •

are

wires

Direct

100 pounds.

50c a

<

Teletype: JCY 1160

area

reduced

has

City Stock Exch.

Exchange PL, Jersey City

7

by

being compiled but checks
companies indicate

efficient

maximum

a

Using

4th

Effect

Chicago

33

__________

Public

sales

*An

index

now

cost
savings because
so
other factors are involved,
but at least part of the sharp im¬
provement in the fourth quarter
earnings rate can be attributed to
these austerity programs and the
fact
that
these
companies
had
available capacity to satisfy the
higher
demand.
For
example,

Chemical's

Allied

mate-

fourth

the

were

address

by Mr. Geer -before the
Society of Security Analysts'
Forum, March 25, 1959.

at

an

earnings

of

quarter

Continued

on

from

last

annual'rate

year

qf

$4.25

.

have specialized in

Like Best—

Security

State of Trade and Industry..-

I

DDrri"DDr!1 HOPKCI
I II LI L B II Lil 0 lUllflO

FINANCIAL

'

•

t
.

Twice

New

York

25

GEORGE
WILLIAM

Stock Exchange

ST., NEW YORK 4, N. Y.

^

J.

4

•a

Company
t

-

Reentered

i

second-class matter Febru¬

as

25, 1942
at the post office at New
York, N. Y,, under the Act of March 8,1879.

ary

SEIBERT.

In

President

Pan-American
Dominion

ol

N

Union,

^Canada

States,

and

U.

S

T

r

Albany

Boston

Nashville




'

.

,

,

•

'

'

Chicago

Schenectady

TELETYPE NY 1-5"
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corporation newB; bank clearings
city news
etc.) ,
Offices. 135 South La Salle St.
Chicago 3, Bl. (Telephone STate 2-0613)

-records

state,.and
Other

''T

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per year

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Other

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Thursday, April 2, 1959

Every Thursday (general news and ad¬
vertising'issue) and every Monday (com'plete statistical issue — market quotation

United

Territories

Possessions

Editor

INCORPORATED

Subscription ' Rates
Subscriptions

to 9576

m V. FRAHKEL & CO.
"

t

York 7, N. Y.

MORRISSEY,

DANA

2

______

—

Copyright 1959 by William B. Dane

Weekly

DANA COMPANY. Publishers

Park Place, Hew

—

48

CHRONICLE

REctor 2-9570

|

Spencer Trask & Co,

,

-*-

U. 8. Patent Office

Reg

16

You

and

43

33

Wallace Streete—__

The COMMERCIAL and

i

25 BROAD

and You—By

The

WILLIAM B.

Members

.

The

Washington

47

page

.

———---

Corner.

Salesman's

Securities

The Market

Permachem

38

Offerings—

Security

Prospective

Published

For many years we

34

—

Securities Now in Registration

.

York

Chemical

28

many

Nevertheless,

is not

46

_____— — __—

Securities

Railroad

these

since May, 1958, these sales ex¬
panded rather sharply in the lat¬
ter
part of last year
and are
so.

Report

Securities—___

Utility

is difficult to illustrate all of

It

1949

an

Continuing to do

Quarter

Earnings

rate.

as a base year, sales
important group of chemi¬
cals averaged in 1958 at the same
general level as they did two
years earlier. Reflecting the gen¬
eral
improvement
in
business

New

15

several

near

-

as

more

dustry has not operated anywhere

the

14

Application of Anti-Trust Laws of U. S. A.

other

di¬

that in the past 18 months this in¬

for

—Ira

shipping certain chemicals

When

closely:
that complete

Amos__

where
successful
in

operating

pounds of a product are shipped,the total saving mounts up.
Still

more

The chemical industry is so

W.

from the east coast to the midwest

market which has prevailed since
the summer of 1955. Let's look at

With

NORTHWEST

PRODUCTIONS

re¬

transportation, where pos¬
For
example, Hooker is
now shipping
by barge from the
Niagara Falls area to the midwest
and to the east coast.
Secondly,
companies are also using these
new
large size freight cars with
120 ton capacity compared with
the older 50 ton type. One com¬
pany by using these larger, more'

the

reverse

be

not

sible.

chemical

slow in

MINERALS

% 12

____

Prospects and Problems Until We Reach the Golden "60s"

water

(3) 1 many new: high profit spe¬
cialty products coming from re¬
search, and (4) somewhat lower
start up expenses, all of which
should
permit
substantial
in¬
creases in share earnings and cash
flow compared with 1958 results.
should

—William

•*

ity will be utilized with substan¬
tially reduced break even levels,
{2)r the prospect for somewhat
higher prices for basic chemicals,

verse

Peace—Alexander Wilson..

When Are Warrants Warranted?—Roger W. Babson.

management
was
cutti ng costs pertain^ to
ffrei ? h t. >
Many companies haV'e found that
these can be
reduced by
using

the above indicated unused capac¬

.these

of

The Brighter Pattern for Banks and Bank Stocks;

<r

-v.;'

Another

Supporting reasons for the an¬
ticipated general market improve¬
ment for chemical shares are:

will

hired

maximum efficient rate next year.

factors

Resurrection

11

_______

,

chemical operations
80-85of capac¬
1959 and work closer to a

These

McWilliams_

Cer

average

ity in

The

-

Bruce

average

still higher in 1960.

this

on

—J.

.id Diamond Alkali 11%. For betr

business,

'Based

UNITED WESTERN

Why We Stand at the Beginning of the Small Car Market
*:

total

should

average

18

'

i

6%;
Hercules
Reduction 8%,

by

perspective, by using indicated
annual wage, this reduc¬
tion in help totalled nearly $50
million for du Pont in 1958.
Most
of those people laid-off by these

will

'

BASIC ATOMICS

Jr.

PERMACHEM CORP.

y e a r s:;1

these

'projected

!

13

inefficient

high

.rates. I might
inject here
that

Kennedy,

Dept,

STREET, NEW YOWC

ASSOCIATES

Exemplified in the Chemical Industry

as

E..

•

-

of

chemical pro¬
ductive facil¬
ities

'

ness

sustained util¬
ization

:; -y

During the recent general busi¬
readjustment, chemical man¬
agements endeavored to cut costs
in practically all areas of opera¬
tions.
Some of the most signifi¬
cant have been the elimination of

should

.

ACOUSTICA

3

^

Queeny______________

vf Growth Stocks
•

?/

^

M.

WALL

%;■.%

:

.

ahead in

move

-

.—Cover

'v,■■■•> '7-,
-\r
Y
7 Chemical Industry's Outlook for Second Half of 1959

capacity

eral years,

Petrochemicals—Henry G. McGrath

Chemical Industry Prospects—Ralph W. H. Geer

.,

which will be operated as general

sev¬

•

Telephone: WHitehall 4*6551

About the Chemical Industry

rially above the 1956 high. Thus,
giving weight to the more than $3
billion sp^nt in the last two years

18 months.

"mistakes" td

your

■

-

be wrong.

can

10

99

In concluding, the author analyzes
are believed to be attractive in their

I think chemical

;

stocks

99 Wall !

gains continuing for most companies and considerable room
for market appreciation as near and intermediate term profits
come

I

'

s

—about

<

Bank

and

^Quotation Record
„

$45.00 per year
»

N0te—On

the

rate

—

Monthly

(Foreign Postage extra

acoount. of the fluctuations in

of

exchange

remittances

for

subscriptions and advertisements
must be made In New York funds
foreign

;i

,

Direct

Wire to

..PHILADELPHIA

4

The Commercial and Financial Chronicle

(1524)

building

Observations.

attitude toward

now

spilling

over

one's

of the

areas.

Now

again

Wall

bare fact
:

fer¬

are

marshes but
abroad.

The

Mis¬

givings over

Wilfred

diminish¬

the

ing yields and
high price-earnings
.

Investor

can

.

,

.

initios here ai e

memories

s

his

of

abroad,
abroad.

a

+V»«

nnnnimtr

accounts, have

„

.

with

ratios,

reminder

the

that

other factors outside of inflation^
are at stake in the appraisal of
equities. Moreover, the occurmost reputable auditing firm, who rence of such an imponderable as
fjM aU that was usual and possibie criminal sabotage underlines the
spot-checking inventories, and desirability ot portfolio diversifi-n the face
supervjsion by high- cation.

10

into the 12

gone

of

West German mutual funds.

improve

Whereas foreign purchases have
been largely confined to institu¬
tional buyers and the funds,

with
Works
the
most
Philip Lamp
heavily bought issue by the latter
during the last quarter of 1958,the individual is becoming more
and more glamorized by the role
of

investor."

"international

will

long

bust in

?]-se

+

to

a

—

IBM in

the

-^ua

temptation
TT3iv/i'

i

mighty lBM s longawaited split deliveredm the form
ot

a

3-tor-2

all

the

merchandise

unabje to fork up

m

share

adjustment

as

—

auditors.

additional

The

money>

ne-

rendered

impracticable

as

a

general practice by the amount of

requirf^xu
The net is that
legislated

or

■

i-

i.

■

.

honesty cannot

insured by regu-

means

of

outwitting

dive
excuse

vestor's
based

.there
split

on

may

oe

fnr

tor

enthusiasm

me

m-

that

is

tions

and

with

hig

suicide

reduction in the market price to
what the buyer "can afford," is
a

The
The

British

solution

remarkable is the

more

the

a

the

on

grounds

of

you're thinking, for example, of forming a
syndicate, we'd appreciate your keeping in mind
our

operations

are

quarters

industry

a

likewise

being

new

of

the

fund

statesmanship is
displayed.
Over

In

rationalization.

see
an

But

truly nationwide.

highs,

Bank observes a broad dispersion of experience among
major industries; Some have already moved ahead to new pro¬
duction highs while others still lag. Each
recovery period, while

possessing broad characteristics
individual composite of forces.
led the way
months at

&

COMPANY, INCORPORATED

enlightened

an

120

•

PE 5-7330

Broadway, N.Y. 5* WO 4-8400
PITTSBURGH




•

ALLENTOWM

•

LANCASTER

The automobile

industry, which
in the 1955 recovery, has leveled out in the past two

in

annual sales rate

an

about 425,000 units to

Other

1955.

laggers

are

cies but display modest-to-vigorous long-term

Not until

growth.

the predominantly cyclical industries achieve new highs will the

take

recovery

on

"boom" characteristics.

Nationwide Bank Clearings Up 3.1*7*
Bank

with

a

this week will show an increase compared
Preliminary figures compiled by the "Chron¬
telegraphic advices from the chief cities of the

clearings
ago.

year

icle" based upon

country, indicate that for the week ended Saturday, March 28,
clearings for all cities of the United States for which it is pos¬
sible to obtain weekly clearings will be 3.1% above those of the

corresponding

follows:

York

Edward

his

A.

Merkle, President of
Fund, Inc., expressed
progressive philosophy thus:

"When
pany

we

see

in which

stockholder,
effort

to

an

abuse in

a

needle

_—-

773,913,154

4—

—

-f

1.7
9.5

7.1

9.6

J Construction Contracts Set New Record in February
Construction contracts in the United States (excluding Alaska)

$2.3 billion in February, setting a new all-time record
18% above February, 1958, according to F. W.

totalled
for

month

the

Dodge Corporation.
In
releasing-the
President

and

latest figures, Dodge Corporation's ViceEconomist, George Cline Smith, said that nearly

evdry major construction category rose above last year's level.
"By far the strongest element in February was housing,"
Dr. Smith reported. "The number of new dwelling units covered
by contracts during the month totalled 85,206, an increase of 44%
over February
of last year. Units in apartments, single family
houses and two family

houses all were up by approximately the

percentage, markings the first time in several years that
single family houses have been as strong as the other two types."
"But the most encouraging feature of the new figures," Dr.
same

Smith said, "was the first upturn in
since the recession. This category is
dicator

by

of

37%

conditions

February, 1958,
about the future."

over

optimism
Non

economic

-

residential

.building

industrial building contracts

an extremely important in¬
ahead, and the fact that it rose

is highly significant
contracts

in

of business

February .totalled

$704,337,000, down 6% below February, 1958.. The decline was
primarily accounted for by decreases in contracts for offices,
Continued

We maintain active

on

page

trading markets in:

Jefferson Standard Life Insurance Co.

make
the

an

Life & Casualty Insurance Co.

Public Service of North Carolina

all-out

management

Spur Oil Company

will at all times vote

our

stock.

Established

own

of

our

Member Midwest Stock Exchange

chief

management obligations. And tak¬
ing the easy way out by just dis¬
posing of our holding is to con¬
tradict the first principle of proper

corporate practice!"

INCORPORATED

shareholders,

on one

1919

R. S. Dickson & Company

To do otherwise is in effect to dis¬
our

$12,106,579,100
1,055,118,784
964,000,000
706,430,790

we are a substantial

we

and to default

1958

1959

954,872,918
896,000,(MX)

—

_—

Philadelphia

com¬

right thing. If this does
not work,
we
will vote against
management, whether or not there
is a proxy fight. No matter what,
we

7

$12,311,266,307

approach.

interview with this writer,

franchise

123 South Broad St., Phila. 9

to all recoveries, has its

common

near 5 million units.
Imports now
this total, whereas they were nominal
machinery, both electrical and non¬
electrical, and minerals production. Leading the way into new
high levels of output are chemicals, paper and printing, foods
and beverages, instruments, and major household appliances. Gen¬
erally these are industries which have moderate cyclical tenden¬

add

to do the

STROUD

the

Harris

now,

the Madison

If

the fact that

other

stock"

in

were

which had been expanding very slowly since
September/showed
an
encouraging rise in January to a new recovery high.
As over-all
economic activity reattains former

Boston

we

every state

in.;.January

after seasonal adjustment, but unemployment was down only
slightly to 6.0% of the labor force. Nonagricultural employment,

usual discount, in op-

agement has embraced a hands-off
policy even accepting the absurd
"if you don't like it,
sell your

newest.

incomes

personal

a new peak rate of $362.3 billion, $2.5 billion above
December.' Total employment rose 250,000 persons in
January

closed-

the years in cases of a proxy fight
or
other controversy fund man¬

security

strikes,

running at

jjeu 0f the

"

Union—plus Alaska, the

Despite/;disrupting

Chicago

stockholders

Although Stroud's home office is located in Phila¬

underwriting activities extend into

months of recovery the average monthly rise
The continuing expansion of steel output, partially
due to inventory accumulation prior to wage negotiations,
presages
a
further rise in the February index of industrial production.
seven

Week Ended Mar. 28—

Co.,

abolition

48 PLUS A

the

first

2 points.

New

-In

our

the

overseas Securities

avoiding needless underwriting
non-existent in this instance. The
of
fraud
lies
in
greater self- expense, and of forestalling the
*cf. Quarterly
Investment Company imposed ethics to implement risk of knocking down the pre59.
Survey, "Chronicle" Feb. 5, 1959
legal regulation. The chance for mium and diluting market value.

delphia (with branches in other cities),

in

was

end company which sells at a sizable premium (recently 40%) in

personally holds sizable amounts
of stock, is suiting its policy to
solicitousness for the body of

Pattern

for

without

month

present trends conform to previous recoveries.
Industrial
output has risen one point monthly the last two months whereas

current position exhibited by the

would have asset value, thus avoiding asset
concocted other means for per- dilution of nonsubscribers' interpetrating his grandiose pecula- est., But the management, which
accelerated.

11th

as

tbe

h»t

posing a
stockholder's
pending
stringent regulation, particularly
proposal for the offering of addiwhen an enterprise is prosperous,
tional shares on its outstanding
It is true that if the epochal proxy statement. The
proposal is
Kreuger super-manipulations had motivated by the desire to offset
taken pjace j11 America instead of the fund's substantial
capital gains
Sweden, they could not have been distributions.
The suggested of-,
consummated. But this only means fering would not be made below

the alleged attraction of

its

k

srattpror)

«omo

4S!1 cSSi, ,!n S that here Kreuger

a

entering

week last year. Our preliminary totals stand at
$23,105,101,224 against $22,403,604,380 for the same week in 1958.
Our comparative summary at the principal money centers was

w;th

the most

even

is

recovery

ineffective opposition by minority
stockholders

rmrsued

cessitated, whose checking would
be

Production

that

those

on

unwilling or
the subscription

are

the
This device for enlarging the
services kitty by managements has "been

of expert engineers would be

a

the current tired market

construe

of

Price Index

Auto

showing significant loss of momentum states the Harris Trust and
Savings Bank in its March "Barometer of Business." The monthly
business summary admits that the rate is slowing but believes

dilution —and

a

assessment

an

shareholders who

physical

complete

a

inflicts

,

bence

rePresentatl01J' More spe-

check

a

the Bargain Basement?
resist

vaIue

of

case

in

business

6>IlcU

OUTBURST at

OF THE WEEK

not

veracity

The

1sua ,f'.'flcrCntlaI
the below
outstandin2
market °f
price
asset

.

,

lation. The smart, well versed thief
the
top will always devise

SPL1TOMANIA

could

1

all stores cannot be made by

bo

Even

its

cifically,

market?

own

our

How

outlive

glamor

such

....

A-

«

information quontitively does not

Industry

Food

Business Failures

J

The
Englishman
complete code of proper

A id j
responsible and conscientious
FUND STATESMANSHIP
enthusiasm
over
resulting
enthusiasm
over
the
operating official. In 1959 as in
Offering of additional stock
European Common Maiket is-,j9g9
jt must be recognized that
through rights by closed-end in¬
prompting the formation of a■ ^ere are
unbridgeable difficulties
vestment companies whose shares
closed-end investment company to
in the way of prescribing hardsell at a discount has constituted
invest in industries operating in
and-fast accounting rules that will
a
that area.
long continuing abuse.
Even
be burglar-proof. Fixed rules can¬
though existing stockholders are
Substantial amounts of Ameri¬ not make
proper allowance for excan
money
have lately entered perienced and subjective judgment given the opportunity to take up
their pro rata number of shares,
the German market. Considerable which
suits
auditing policy
to
of such U. S. funds, through Swiss
indiv'iduafcases. Reveafin'g'more
burnings

previous

and

Commodity Price index

"cricket."

common stock holding, it
underlines the inadequacy of curren^ dividend and earnings yields,
Surely it warrants skepticism over
current boom market defense of
the inverted stock-bond, yield

Robbins

&

Retail Trade

State of Trade

according to
idea of what is reasonable

just 20 years ago was
perpetrated by Messrs. Coster and
Musica despite the attendance of a

May

to extinguish the Ame i-

serving

McKesson

scandal

Production

Electric Output

Carloading;

moves

one

in

filching of shareholders' property
through a writeup of assets, fictitious
statement
of
assets, and
omission of liabilities, cannot be
prevented. ^ ;

Florida

the

Federal
control,

ever-tightening

of

years

Securities supervision and

reting out still
"green" profit
opportunities
not only in

Steel

The

permissible,

as

Green
incident offers important
implications. Reminding us of the
unavoidable and everpresent risks

is that after 25

face

we

we

behavior under which he operates
independently of the
law;
the
latter simply being held in reserve
as
an
occasional weapon against
the most flagrant abuses.
Investment policy-wise, too, the

con¬

transactions, involves important
implications in wide areas of fi¬
nancial regulation, corporate con¬
duct and investing policy.
The

Street specu¬
lators

shortages

nected with the Olen-H. L. Green

other

closely

as

follows

ETHICAL MORAL
The disclosure of

buying
into

which

and

twenties, is

boree of the nineteen

the

law

treme outer limits of an area in

bargain

no

NEW SCANDAL—AN

a

hibited

price surely is

traditional append¬

stock market boom, exin the speculative jam¬

of

ages

the

While

the Englishman conceives the law
rather as a wall marking the ex-

basement tag!

DEPARTMENT
of the

One

360

Thursday, April 2, 1959

.

think of the law as a hurdle to be

By A. WILFRED MAY
SIGNAL

lines.

British

skirted

DANGER

.

lies along the lines of
ethical tradition and a

progress

changed

along

.

CHARLOTTE
Atlanta

Columbia
Direct

NEW YORK

Greenville
Wire

to All

CHICAGO

Raleigh
Offices

Richmond

36

Number 5834

Volume 189

.

.

.

The Commercial and Financial Chronicle

\

Incoming Tidewater
Enterprise Economist and Author of "How to Get Rich Buying Stocks.'

Suromarizing

Not

substantial improvement in earnings

a

the

for 1959.
tide

The
in

i

r.

in

All

cents,

1957.

the

face

these
not

to

Ira

U.

sprightly
from which
a

dive

to

of

consideration

favorable

Tidewater

«««

nnvk'

Angeles.

...

common

this junc-

at

Tidewater's

Yet that is what we propose
to do—to
do—to consider
rnnsider TV
TV (that's
to
(that's the
the
ture.

nil.

more

friends

«°deficitasS
aeiicits
it

other

refinery

earning power
-

Last

a'lrd

behind
oenincl

for
101

ana,

1a T
Y°n<^much
twice
over

fee(j

property

hit.

It

assembled for in-

ever

dustrial

on

purposes

seaboard,

a

the Eastern

fabulous

$200

new

at

.retmery

ISO,000 barrel-per-day
beauty is the largest new refinery,
ever built at one time, and is the
very
last
word in design
and
function.

It

hi§h
a

converts

test

83So1ihg

whole

series

crude

3nd

of

in the process.

magnificent
to
receive,

oil-

do—

useful

But this

plant

was
designed
to operate on,
lower cost foreign crude coming
m by tankers.
And just as the
plant was ready to run full blast,
there was an untimely "voluntary"

and

reduction of crude oil

imports imposed, followed, more recently,
by a mandatory crude import restriction affecting all major com-

+v\^AnrfViAii4

t^rgir ? t^e
^ button elec-

discussed

in

Continued

The

1954,

some

future

Since

date.

dividend

policy has been
paying 5% in stock

to

TV

common

has

ranged- in the past five years be¬
tween-*^ low of 14% and a high
of 43%.
At 23 V2, therefore, this
common

mained
of

and

have

to

appears

re¬

relatively

uninflated by
market pyrotechnics

general
recent

months.

It

sells

in

a

first

the

of 1958 were
general busi¬
Furthermore, the
sharp declines in copper prices.in
1957 acted as a drag on earnings
for that year. (The Company con¬
sistently
maintains
a
generous
part

also affected by the

ness

Marketwise

Security

I Like Best

possible union or merger
with other Getty controlled prop¬
erties at

from page 2

connection

concerned about lita-

recession.

working inventory of this metal.)
Beryllium Corporation has oper¬
ated

in

since

the

black

in

every

v

+

•

'

i

of

tankage,

miles

1,650

a

.

sSeTfn

are

granite. All in all, Tidewater presents an exceedingly modern de{.he

and

cor

in

uitimate

20th

Century office sophistication to
those
who
visit
its
executive

rankg

world>s

the

among

of

pipe

major

A

s

Hot
t

o

r

e

• • o

l'\ i

n

„

April 21.1 The

standing, preceded by 3.5 million
4%% notes, and $134,725 of a

meeting is.
the

open to
public.

Mr.

R

e

o

m

n

y

of Beryl¬
Corporation is strong and
adequate to meet all present con¬
tingencies and expansion plans.
Capitalization is simple, with 606,533 shares of common stock out¬
of

5% mortgage on an acquired plant.

-

The

.

common

will

discuss

is

the

growing

Counter

conflict
tween

be¬

now

stock of Beryllium

selling

in

Market

small

and large cars

small-to-medium

and between

should

domestic

foreign

the Over-the-

around

part inter-

Whk

auto¬

sized

company,

George Romney

what
fo».

prosoects

the

are

tidewater

Well

the

in

of

first

tke wh0le industry is looking
jitter

it

than

now

did

a

year

0f the over-production,

ag0

which

crisis,

from

stemmed

the

Suez

We

are

pleased

been

to announce

that effective April 1, 1959, the

following officers of Kerwin, Fotheringham & Co., Inc.,
will join our organization
in the investment

has been corrected; exinventory positions have
corrected, and an indicated

cessive

and continue to

serve

their clients

banking and brokerage fields:

J, H. Fotheringham

7

increase in total demand for 1959
in the

order of 5%, has resulted

Miss Ahna Jolley

Yy 7

in stronger product prices

with a
rise in gasoline prices in prospect,
With
firm product
prices, and
some
reductions in crude prices,

Charles S. Lottmann

Robert P. Disse

refinery profit margins generally
are
showing great improvement.
Integrated refiner-marketers, such
as
Tidewater, should be able to
show
substantial earnings gains,

William R. Bergin

the first six months of 1958.

wild

no

optimism

to

or

ramp¬

suggest

that

stock, at cur¬
23%, is a
looking
equity
than it has been for many months.

lias been admitted to
I

'

general partnership in our firm

G. H. WALKER & CO.

around

of

'

Founded 1900

attractive

The
"

common

levels

rent

more

.

then

futuiv**

immediate

and that its

'

.

Tidewater has turned the corner,

Mr. Gene M. Woodfin

of

problems

costs

start-up

of new units, the expenses

Member New York Stock Exchange

and in¬

conveniences of moving into new

Investment Bankers

^

quarters, and the lag in consumer
demand

Rhoades

&

Co.

a




now

comfortably be¬

long-term

for

leverage

There

are

debt,

TV

ahead
.

.

of
'..*i

8224 Forsyth

St. Louis, Mo.

Blvd., Clayton, Mo.

$281.5 million

and

2,495,708

scares of $25 par $1.20 cumulative
preferred standing on the balance
sheet

503 Locust Street,

affords

capitalization

considerable

common.

in

are

The

hind.

April 2. 1959

A

participate in the growth
of a new metallurgy with exciting
potentialities. It is believed that
once
Beryllium Corporation has
clearly demonstrated that its earn¬
ings are in an upward trend, the

and

nhvsiVal

miefpninrr

properties

ant

pleasure in announcing that

Carl M.. Loeb,

$40.

stockholder,
although
assuming
many of the risks inherent in a

Getty II, President,

Thus it takes

'

building

'

•

C0ft™tiding"

over

'

+h«

machines
hnimino-

,

these est in about 4,500 additional miles
import limitations, offered in the of pipelines; and an ocean tanker
guise of "national security" ap- fleet that, on completion of prespear in some ways to be a rather ent building program in 1962, will
pious fraud. They originated with total 1% million tons.
certain large-scale domestic proWhich brings us up to marketducers who, no doubt, generated ing.
Tidewater has been moving
considerable political pressure to rapidly ahead with its Flying A
reduce domestic competition from gasoline; and its Veedol oils and
oil surfaced overseas. The broader greases are now distributed in 77
viewpoint would seem to suggest countries around the world.
In
sustained, or even rising foreign the domestic market it has sales
petroleum imports, so that in any outlets in 32 states, Hawaii and
military emergency, our own na- the Philippines. It has over 2,700
tive oil supplies would be kept major service stations and almost

'

Association: at;?
the

dat^

ekckonic
office
n„
nntcirin

The financial position

liquids, Qftd over three trillion 0jj companies. It is modern in mobiles, and
the effect of the automotive in¬
cubic feet of natural gas. About every sense with the industry's
nation's
future
half of Tidewatei s total produc— npvvesf and finest refinerv some dustry on the
v
investment community will
Ron comes from Texas and Loui- ofdhe targer and latest deWgned economy.
re¬
Mr. Romney was a tariff expert spond
siana; and the company has a tankers, the ultimate in executive
and generously evaluate
most piomising 25 /o interest in officer
anr?
a
broad
exosndinsf in Washington for Senator David these higher profit levels.
the CATC group doing extensive sales-conscious chain' of service I.
Walsh, D., Mass., in 1929 and
drilling on choice and sizable off- cfntinn<? (thvpp Flvin<* a dealprs
Joins Walston Staff
1930.
He was managing director
shore Gulf acreage.
In further in 1958 won the "Servicf Stations
(Special to The Financial Chronicle)
the Automotive
Council for
search for oil, Tidewatei has foi
tho ypot" awards in Connecfi— of
DENVER, Colo. — Geraldine
the past decade drilled on the av- cu<. s Tidewater has all the facili- War Production from 1941 to 1945
Hamburg has joined the staff of
erage 190 exploratory and develthat
make
for
petroleum and is a past president of the
Walston & Co., Inc., Denver U. S.
opment wells a year.
progress and profitability, includAutomobile Manufacturers Asso¬ National
Center. Miss Hamburg
in transportation, Tidewater is ing aggressive leadership under
was formerly with l. a. Huey Co.
extensively equipped with some the direction of Mr. George F. ciation.

To digress for a moment,

■

year

The

earnings trend
was irregularly upward from 1947
through 1957. The company has
not as yet hit its full earnings
1947,

lium

cial Writers

On this point, Tidewater had
at the 1957 year-end, '5,873 net suites.
producing wells, recoverable reTodav
with cross nronerties of
serves of 520 million barrels of over a bipi0n dollars, Tidewater

and gathering lines,

We take

speaker at the annual dinner
meeting of the New York Finan¬

F? hnJkGround
Hl-Fl
back-teround

That is whyTidewater
so

1,150 railroad cars, 2,000 automotive units, over 40 million barrels

panics.

1

Ver-

Wi

anQ

itself

Delaware crude; 85 million barrels of gas

City. This

velops

company

ited imports and restricted domestic production, and has been
so aggressive in its search for
had just domestic oil.

completed in 1957, on the largest

fractions

the

as

^ether
oil to

crude

was
no
thing
of
the oil industry in
but Tidewater was par-

ticularly' hard

into

them

has been

for

miliion

as

produces

for 1959.

year

general,

magnificent

at

Avon,

variety of reasons, should demonstrate
a
notable resurgence
in

beauty

been

each June.

t

9° ^

d

Of

65%
by the

approximately

reported to be owned
Getty
interests; and Tidewater

the

d

the

listed

is

has

iM

"?Z ff

j?.

equity

confined

anrf

Calif., has a throughput
ioq nnn
capacity of 108,000 barrels-perNYSE symbol for the stock-not
day. Thls unit) and the larger
nut
put

This

Stock

N. Y. Financial Writers

Cobleigb

very

springboard
into

w\

this

on

Exchange.

common

Romney to Address

do

appear
a

it

soggy

statistics
be

A

^*

of

York

.

On

of

4-

the

boast

wi8/?- SI
J il?.nrtPishli
wnlhirp pfiviin

™

New

5

why we deny them access to our
^ in
popular price range, and assum¬
huge markets for their lowering a significant restoration of
priced products.
; ;
ironic control. .
'
earning
power ; in
the
current
For Tidewater's big Eastern restride.
Present indications sug¬
Then to provide parallel faciliyear, Tidewater might well prove
finery there are hopes for a more \ S9? on . the Eastern seaboard, a
gest that finally a start should
rewarding equity for patient
equitable quota' treatment,
be made in that direction this
and Tidewaters Easterfi Division
shareholders.
the lower prices of such crude moved, on Feb. 1, into plush new
year.
During the full year 1959,
as is permitted
entry, make for Quarters in the new $15 million
it can be reasonably anticipated
much higher refinery profit mar- Getty
that net earnings per share com¬
Building at 600 Madison
mon
gins, than those existing a year Ave., New York. Here Tidewater
stock could approach $2.50.
ago. In any event this refinery is occupies floors five through nine,
These would be the highest earn¬
one
of the most efficient in the Plus basement space and employings as yet reported by the Com¬
world and can prosper on quite eej> wm'k. in an atmosphere of
George Romney, President, pany and compare with an esti¬
sybaritic luxury. The building is
mated $1.00 in 1958; $1.72 in 1957;
thin runs of crude, whether forAmerican Motors
Corp., will be
completely air conditioned, has
eign or domestic.
and 35 cents in 1949.
the

against a plus
figure of $2.42
for

r.

net

abroad, who will not understand

f

o

4-V»

be, the

also

can

nnfitrifioo

divi-

three

K

hontino

cnano

pre¬

'

d s,

ttfiH

seas

may

try will lose a few

share,

after

the

cross

could
in safety.

it

»niVSvb™^»1marble and steel-clad edin'n nnf.n *'Ce 'S the COntrol CCIllcr for. all
space heating oilSj and our coun-

defi¬

ferred

but

shares

with

only does Tidewater boast
refinery in the busi¬

tankers

case

However this

es¬

an

per

n

of

results

$2,-

timated

e

the

This

created

d

earnings

1957,

in

Coasts.

finest

ness

adequate,
no longer

CO

Km ii

about

600,000.

cit

net

From

1958.

$34,937,000
to

out for Tidewater

was

West

and

of the factors about Tidewater Oil Com-

some

which suggest

pany,

10,000 outlets, in total, handling
company's branded products.
Aggressive selling and attractive
service
stations are moving the
Flying "A" brand name to the
forefront, especially on the East
the

By DR. IRA U. COBLEIGII

^

(1525)

the
•

13,224,714
...ii;

v

_

■

■

New York

White Plains

Providence

Hartlord
Bridgeport

6

The Commercial and Financial

(1526)

i
Unpopular

Inflation is

the Committee
(July 11, 1957).
Dr. Means in recent hearings has
persuasively documented these
soundness and for their courage conclusions by. showing how inin
committing
other people
to flation has been localized in the
such

Professor

of

Economics, Harvard

Next

are

high,

any

the principal loci of inflation and

not stable.

are

Structural

opposed to

"do nothing policy7' that

unemployment to

nses

the

if I

there

last

two

has

been

measure

of

causes

of in¬

flation

an

three

or

sense matters

increasing

agreement

Full

of

its remedies.

.

positive

the

awkward

still

possible
much

control

over

prob¬

lem is show¬

and inescap¬
able bones of

John

on

so

K.

Galbraith

to

ment

be

can

and,
are

nnr

a

described

matter

often

used

and idle plant
incnntiiio

where

It

ob-

to

investment.

Low

a

.

_

u

follows

that

110

Galbraith

be¬

Antitrust

and

Monopoly
of
the
Committee
on
the
Judiciary, United States Senate, Wash¬
ington, D. C., March 11, 1959.

on

have
wave

I

a

gone
8"'^

into
»hu

deii-

Do nothing.

Rely

my

(3) Break
(4)

Design
proach

and

price

To

do

nothing is,

in

industries

of COUrse, to

hope

own

that

soqtoer

or?;.'

When this

is

imperative

as

now.

But

it

time.

.

nothing is not

choice.

is

Let

reflect

us

tolerable

a

well

and

carefully on the kind of inflation
we are
talking about. It is led by
the

prices
of
the
firms.
It

the

largest

the

are

is

and

paced

ized

by

have

firms

and

power.

Those who endorse an in¬
flation of the modern sort are en¬

dorsing
the

to

a policy of giving the most
biggest and strongest and

This

is

not

the

inflation.

whole

But

case

point
must be seen with all
clarity. The
modern inflation is; "not neutral.
Because

opinions and forecasts of the nation's public utility leaders

cation

of

its

with

one

Get your

perspective

on

inherent

the outlook for this vital segment of the
*.

Finds

this year's prospects and the future trends of

Monetary

Bank

before

in

miss the

this

opportunity to advertise

important issue. Please

make

forms

your

reserve

Firm, Corporation

your

space

or

.

of

practical

requirements

and

,

,

The

way.

useful

a

or

administered

advance its prices,
does, whenever the economy

and

•

can

employment. The level of use
of capacity and the level of em¬
ployment depends on the level of
demand.

important issue.

:

Both

monetary policy
policy make contact
with the problem by
reducing the
and

fiscal

level of demand.

they, must
create

To be effective,
it enough to

u

reduce

idle

capacity-v and unem¬
ployment, since the inflation oc-|
curs

THE COMMERCIAL & FINANCIAL
CHRONICLE




PARK PLACE, NEW YORK

7, N. Y.

when

2 Prices

but

25

for

2-9570

these

of

productivity
match, at least
3 As

under

wages

I

have

have

related

gains
in

present
also

the

employ-'

vn

,

industries,

policy

Monetary

r

be

and

fiscal

remedy only by
severely cutting back output and
can

a

employment.

This

remedy

is

than the disease. The third

worse

large unions.

the

up

perhaps

Can

not
enforce the antitrust laws with all

vigor and extend
to

the

them

we

somehow

unions?

The antitrust laws
able purpose.

science

serve

a

valu¬

They bring the

con¬

of the

community to bear,'
on
the
problem
of
economic
power. And thus they restrain the
strong firm in its relation with,'
weaker customers, suppliers and
competitors. It is for this reason,
they have
always
had
a

that

strong, claim
men

be

of

than

they

trust

interest of
They could',
,

sense.

and

better

enforced

•'

are.

to

But

the

on

moral

stronger

that

suppose

laws will

revolution

work

the

the

will

which

the

anti¬

kind

of

reconcile

wholesale revision

a

structure—a

increase
as

a

there

sirable

indication

is

antitrust laws
for such

to

to

the

not

from

slightest

history
the

are

that

the

instrument

revolution. As applied

a

industry,

the policy would be
politically divisive. The applica¬
tion

field

to

unions

day

think

would

those

for

the

attack

wonderful

excuse

on

for

provide

a

who would
inflation a
an

attack

on

labor

organization as such.
There is no hope for an infla¬
tion remedy in the antitrust laws.
To argue that there is may be to
engender doubts about the effec¬
tiveness of the

antitrust

laws

for

other important purposes.
vni
The

Case

for

Intervention

in

whole.

the

matter,
power

Only

one

course

mains. That is

some

ceases

lic intervention in

groups.

economy

to
regulate
relations
between
Thus a coalition between those
bargaining power and against the
public interest becomes all, but certain.

with

whole¬

disintegration
of
existing
business units. Even though de-

rate

need

countervailing

put

mean

industrial

risen

low

the

economy

elsewhere

inflation

to

and

part,

in the

not

are

services

reasons

of

money

RECTOR

full

proper course is to

sale *

fiscal, policy do
contact
withi present

and

for space in this

at

by

rev¬

The position so far is this: At or
near
full employment
we
shall

in

is anywhere close to full
capacity

Regular advertising rates will prevail

the

raise., taxes.

would

Fiscal

and

inflation; in

price sector

closing date of April 15th.

-

produced

enues

ment; then the

needed

are

exceed

employment with price sta¬
bility is out of the question. This

Policies Limited

;

Monetary
not

not

that

full

'

public utility industry.

Do

community

..

,

★

services

the

identifi¬

strength, it
is
inequitable,/regressive and
reactionary.3

.

the

the

economic

•;..:;B- 7; B'vvi ;B' /
★

not insure
stability at full em¬
ployment, it is one of the condi¬
tions necessary for
stability at full
employment. Budget balancing, I
might add, does not necessarily
mean
reducing expenditures.
If

usually do not

bargaining

at all.

ANNUAL PUBLIC UTILITY ISSUE will
pre¬

on

there is
unemployment and idle
capacity, an excess of government
expenditures over receipts is by
far the surest
way of expanding
economic activity. Then we should
have a deficit, and when
output
and
employment are high, the;
budget should be balanced. Even,
though a balanced budget does

possibility is to break
large
corporations and

weaker

effective

est.

non-industry authorities

the

activity—will
bring stabilization at
full employment is not to
say that
fiscal policy is
unimportant. When

also the

Also the retired and the aged who
have no real bargaining
position

April 16, 1959

nation's economy.
"*■.B'

and

itself

and

workers -who

against

and

say that fiscal policy—

suf¬

the least to the smallest and weak¬

sent the official

.

largest

weaker unions.
Also the public
servants, school teachers, unorgan•

THE CHRONICLE

our

the

fiscal policy is dif-

Those who

the

of

wages

fer

The 1959 edition of

we

policy,

have inflation in the concentrated
To do

strongest unions.

★

no

No Hope in Antitrust Laws.

?10.

nUjnn

;;■■■;■>

THE PUBLIC UTILITY ISSUE OF

is

here by
be guided

will be.

of

case

l?erent. To

„

^

done,

The

monetary
we

11

hope that the problem Will yield
to prayer, incantation and admo-

economic penalassociated
with invoiun-

on

unconscious advocates who oppose

strongest

Will be Published

setting

concentrated

of

are a few
forthright supporters of this position. There are more indirect or

wtC°f£
some

ap-

problem

reasons in carlier accc'3t i,)flation- There

unemployment.

social

the

which will insure that these
are noninflationary.

•

the
uic

direct

some

to

and

wage

the

%

he committed to less
stringent
goals of economic management and full
employment may well cease to be such

a

the large corpora¬

up

tions and unions.

shall

we

monetary or fiscal
or a combination

on

of the two.'

Antitrust and Monopoly of

is

which

tary

.

Remedies

follows:

...

.

which

not of

measures

{ate/" *« will io somethingto
ties

—

iv

.

there

magic

the purposeful use of taxes
expenditures
to
influence
level
of
economic

ind ustri es.

Four Possible

employment levels, we.

lit

signed to promote the stabilization
Of prices has any chance of
permanent
success , if . it
depends,
either directly or indirectly
on
deliberately continued unemploy-

thp

that

monetary

an
economy can
and directed. Toe less
reliance

in-

The remedies follow with a cer¬

both the stigma and the

policy

I,.

"•■A statement by Prof.
fore the Subcommittee on

tee

output

investment.

rated

concen

nconcentrated

;

testimony before the Subcommit-

invoaimuni

tn

the

n

(1)
(2)

..

subtle

our discovery—more
rediscovery—in these

years

better off

of

uge

ting effect of falling prices in

.

our

few

erallY> when the index has bcen
but because of the offset-

powerful

last

gtafc)lej u hag be(jn not b

of

economy

properly

place

as

There is

fuller ana!ytical

capacity reduce the

gen-

price action.

UUBlUCT-

pfonnmic

And,

tain obstinacy from the diagnosis
The possible courses of action are

dustries.

High employment is also
related to a high rate of economic
growth. High output is an induce¬

inflation.

arc

Sae?erized I ^strong 'fkms

firct in
first
in

the

demand that is favorable to high
employment is favorable to such

neai

society.

The visible

words

come

mninr mitsfnrfiinp nf

ing through.

briefly,

nnmo

to

economic

on

core

problem

little

sys-

nnr
our fhinkinpthinking cnaracierizea by strong lirms ana,
strong unions, prices and wages,
policy. This is un¬
will
react
on
each
other
in
a
derstandable.
Unemployment
is
steady upward spiral. Even with
rarely
considered
desirable
or
considerable idle capacity,/the
healthy by anyone who has experi¬
spiral will continue in some in¬
enced it. For most, it remains the

with it
it
vA/ifh

increas ingly
hard

the

me

.

the

.are

Prices of

textiles and apparel and most im¬

increas| usually,
^ s^m.edlin?> more' So long as,
demaijd is at or so long as it- is.

a

practiced. But

of the

of

sector

firms

Let

add that
monetary pol¬
icy, under all circumstances, is a
secondary instrument of public
policy- Nothing has been more

ma-

portantly of food have contributed

\v

overriding importance of high

employment. The opportunity for
job and the income that goes

questions is

concentrated industries.

Stability

discussion of this problem. This is

Evasion of the

and

our

motive for the use of this price
discretion when wages are raised.
First, let me lay down the pri¬
So the increase in wages is covmary economic and political con-.
dition which controls any useful cr.c:d by a R*-lce

and

logic

defect in

a

pol-

a

ehinery, automobiles, pulp and
P^er'
• tobacqo; apd
bev- salutary than

large and the.
prices is substantial,,
there is opportunity for large dis¬
cretionary increases in prices
when demand is favorable.
The

Employment Ahead of
Price

the

on

the

where

.

the

sec-

by the increase in

erages.2 These, in general,

We
wc do
ao not remove it
it eixner,
either

In

II

correctly,

;

ex¬

by pretending that it doesn't exist

tripartite hearing board of labor, business and the public would
longer make the goal of a strong dollar the antithesis of
necessary public activities, foreign aid and national defense.
a

defects

or
by horrified denunciation
those who point it-out.

no

scure meaning, there is
advantage in brevity.

the

in

for

But

idle capacity and

unemployment collides with the
higher objective of full employment and full use of
capacity. We
set higher store
by these, as I have
stressed than we do by price stability.

since World

^^1, stocl products,

clear that at
Prices

ist in the design of economic sys¬
tems as they exist in machines.

check price inflation and to the condonation of inflation
by
some
fellow Harvard economists, Prof. Galbraith avers a

the

must be

we

emolovment

accounted

Industries

American economy—or more particularly in one sector of it—are

tem
tern,

During

administered

or

tor of the economy

Thursday, April 2, 1959

.

.

of" creating

icy

In fact, commodity inflation since the late forties is largely

Concentrated

in

There is such

years,

concentrated

be

approval,

Ill
Prices

least subject to monetary, fiscal, antitrust and
voluntary appeal
remedies as we reach or approach full
employment. Equally
a

not

should

popular

University

^oijk: Houghton Mifflin, 1958.

public intervention
added interference
He contends the concentrated,

with the free market system.

the

with

.

in substantial amount.

get a certain
applause
for
their

This

misfortune.

recommend

who

may

War II.

price inflation constitutes

unionized industries

of

confused

Professor Galbraith denies his proposal of
to eliminate

policies

amount

JOHN KENNETH GALBRAITH*

The Affluent Society, New

Author:

Those

merit.1

And Can be Prevented
By DR.

Chronicle

where

of

action

re¬

form of pub¬

that part of the
employment

full

Continued

on

page

24

,

This announcement is under
.1

.

,

v '

,*

-

%

new issue

circumstances to be construed

no

"nV

0,1

offering of these bonds for sale

or as a

solicitation of an offer to buy any of these bonds, and is published
legally offer these bonds in such state.

as may

The offer of these bonds is made only by means of the Official Statement.

\

...

77.7 7>. 7% 7', 77'.'''' -'7 '7

7.'

.

as an

behalf of only such of the underwriters, including the undersigned,
■' "

'

.

,

-

.<

77

.

,000,000
The General State

y'i ;.;;

7

y

.

>

;Commonwealth of Pennsylvania

,

•(■'Dated April 1;>,

Authority of the

-Tenth Series, Serial Bonds

■

\ '*

' >*

*

•

,

Due July 15, as set fortli below

*

.

These bonds
>

are
.subject to redemption prior to maturity in part from time to time on July 3d, UMH.or on any interest payment date thereafter if moneys in the Bond
Redemption Fund are used for such purpose and at the option of the Authority on or after July 1.5,as a whole at any time or in part from time to time on any
interest payment date, on at least :■»■)days' prior notice, either by publication or as otherwise provided in the Resolution, upon payment of the principal amount

-

thereof and accrued interest thereon to the date fixed for
front the date fixed for

redemption, plus a premium of
°f 1% °f such principal amount for each year or fraction thereof
redemption to the date of maturity, not, however, in any case exceeding 3% of such principal amount.

Principal and semi-annual interest (January to and July 15,'first coupon July 15,1950) payable at Mellon National llanlc and Trust Company, Pittsburgh, Pennsylvania, or
at the option of the holder at The First Pennsylvania
Hanking and Trust Company, Philadelphia, Pennsylvania, or at Hankers Trust Company,
77
New' York, New, York. Coupon bonds in the denomination of $1,000, registerable as to principal only or registered
(ff'fif'A'f
!
>
bonds without coupons in the denomination of $1,000 and any multiple thereof, interchangeable, .

Interest exempt,

in the opinion of counsel for the? Authority, from present Federal income taxation under existing statutes and decisions.

The General State

sale
;

The Fiduciaries Investment A d ofJ 949 provides that the bonds are authorized investments for fiduciaries, as defined in said Apt, in Pennsylvania.

; -

The bonds
<

Authority Act of 19^9 provides that the bonds, their transfer, and the incqme therefrom, including any profits made on the
thereof, mil be exempt from taxation (other than inheritance and estate taxes) within the Commonwealth of Pennsylvania.

are

secured

the .Commonwealth-,

•

revenues

under leases covering projects leased by the Authority to

,

.

additional bonds issued under and authorized by Resolution of The General State Authority as supplemented. The Resolution, as supplemented, provides
the issuance of the bonds and of addit ional bonds under the limitations therein set forth, the custody and'application of the proceeds of the bonds, the construction

The bonds
for

by the pledge of all rentals payable by the Commonwealth from its current
f
*
•
• .

are

of projects and the leasing thereof to the Commonwealth, the fixing and collection and disposition of rentals under such leases and the pledge thereof as
bonds, the security for the moneys on deposit and the investment of funds, and the rights, duties and obligations of all parties. There have been issued under

security for the
the Resolution,

supplemented $30,000,000 First.•Series Bonds in 11) H) ($10,420,000 retired), $05,000,000 Second Series Bonds in 1950 ($11,149,000 retired), $40,000,000 Third Series
retired),.$20,0(M),000 Fourth Series Bonds in 1953 ($2,401,000 retired), $30,000,000 Fifth Series Bonds in 1954 ($2,470,000 retired), $50,000,000
($003,000 retired), $25,000,000 Eighth Series Bonds in 1957 ($249,000 retired),
and $30,000,000 Ninth Series Bonds in'195K ($20,000 retired).
,
•
as

Bonds in 1952 ($5,779,000

Sixth Series Bonds in 1955 ($1,505,000 retired), $20,000,000 Seventh Series Bonds in 1950
,

The fijll faith and credit of the Commonwealth will not be
.

1 The bonds

ore

.."

*

v-,\-

l." 7

•

pledged to the payment of principal and interest on the bonds.
7.":

'•

v.

"77

'777

•

■

.

tcfi

.

.

uiul subject to the approval of legality by Messrs. Hurgwin, Ruffoi, Perry <fc Pohl, Pittsburgh,
ftoiuf. ■counsel.- anti Warren IP; Holmes, Esqf general counsel for the Authority. It is ex petted that, delivery of the
bond's in definitive conpan form, iwdenomination of $1,000 ivill bc.made on ok abopt April, SO, 1959.

offerff.vty}yyasAanff if. issued-and-received by

us

Pen unylffanw.*

f

.'

;

f-

"

Yield to.-"

Inter est?

Principal
Amount
i

'*"I)ue-

Hate:'

>

% <>% 2;

805,000

100]

000,000

080,000

B

BIV S

1,010,000

ff'i

; ■

*

^

"

•

Price)

f

-T20% 7

;

Principal

Interest

Amount,

Rate

Due

$1,345,000

(or Price)

2.70

1,105,000

V'

■u

•

■u

1,140,000

:

1970

100

V/2%

1978

3.55%

1,395,000

3^

1979;

1971

3.30

1972

•3.35

77

3.55

1,445,000

3. GO

1980

'

1,495,000

3.00

1981

100
.

100

1,175,000

3.40

1973

100

1,550,000

3.60

1982

100

77;. 1,185,ooo

3.40

1974

3.45

1,005,000

3.00

1983

3.65

1907"

B.05

1,215,000

3.40

1975

B.45

1,660,000

3.00

1984

3.70

1908.

B.15

100

1,720,000

3.00

1985

3.70

1005

2.00
B

i(or

1909

81,040,000
1,075,000

72.80

1904

050,000

Due

Rate

>2.50

1963 f

025,000

••

Maturity

Interest

•

Amount

'

m

875,000

Principal -v:
<

•

.2.25%'-

1002

850,000

For

for Price)

Yield to
Maturity

Yield to

■

Maturity

•

1900

100

;

-

.

,

-.1,255,000

1,B00,000

rv-'vS

3^

1970

•'!!

1977

.

(

2

(aeenn '(1 interest to be

100

3.65

7<V

added)

'

.

V

♦

.

information relating tq'Tlic General Slate Authority and to these bonds, reference is made to the Official Statement of The General State Authority
March dl'lOof, which should be read prior to any purchase of these bonds. The Official Statement may be obtained iri any state from,
- •-. *
only such of the underwriters including the undersigned, as may legally offer these bonds in such state.
(

dated

.

;

••f1';

Smith, Barney & Co.

\

-

INCORPORATED

.

/.*

:A. C. Allyn and Company 7: >•

Stroud & Company
rsrCOHPOBATEl)

.

'■

&

;*.-u'"13!it01lPORATEn

Co.

& Redpath

J. AY. Sparks & Co.

:




'

)

-

B. J. Van Ingen & Co. Inc.

White, Weld & Co.

Lee Higginson Corporation
-.,■■■•

Alex. Brown & Sons

....

F. S. Moseley & Co.

^.

Schaffer, Necker & Co.

"

Shearson, Hamm ill & Co.

Reynolds & Co.
'

"

Hallgarten & Co.

'

,

Sciioellkopf, IIutton & Pomeroy, Inc.

Roosevelt & Cross

Schmidt, Roberts & Parke

Singer, Deane & Scribner

INCORPORATED

Butcher & Sherrerd

Auciuncloss, Parker

April 1,1959.

■■•■V''"-

'

.

American Securities •Corporation..
fft, ,
W. II. Newhold-s Son &

:f. •'

Phelps, Fenn & Co.

' '7

y<;

; A. (L Becker & Co.

.

I

77.

:

Lehman Brothers

Yarnall, Biddle & Co.

f'r

W. Ev IIutton & Co.
V

■'

:

'

'.;/•]

.y

7'.

:V
.

Hemphill; Noyes & Co.

' f.

INCOKPOIIAX#)

-

'•:

-Blytii & Co., Inc.

a

Kidder, Peabody & Co.

The First Boston Corporation
7"

" /

eastaiandillo^II^ron^^^curities & Co.
*,

J

IIakriman Ripley & Co.

Drexel & Co.

J. A. Hogle & Co.

Moore, Leonard & Lyncii

Janney, Dulles &' Battles, Inc.
-

*

William R. Staats & Co.

Green, Ellis & Anderson

,

;

Rand & Co.

8

The Commercial and Financial Chronicle

(1528)

was

.

Washington
Ahead
of the Neivs

Dealer-Broker Investment

Recommendations & Literature
Burnhani View

— Monthly
Investment letter — Burnham and
Company, 15 Broad Sfceeet, New York 5, N. Y. Also avail¬

able is current Foreign Letter.

Banking

Pitfield

C.

&

Co.,

Participating Securities and

Share

Purchase

Warrants—Study—McLeod, Young, Weir & Company, Lim¬
ited, 50 King Street, West, Toronto, Canada.
How to Get Rich Buying Stocks—Dr. Ira U. Cobleigh—David
McKay, Inc., 119 West 40th Street, New York, N. Y.—$2.50.
Japanese Stocks—Current Information

Yamaichi Securities

Company of New York, Inc., Ill Broadway, New York 7,
New York.

Japanese

Warehouse

Industry

Survey

—

Nomura

favorites

for

1959

and

data

Securities

Daiichi

on

Bussan,

Mitsubishi Shoji and Marubeni-Iida.

Listing

on the New York Stock Exchange: Its Purposes, Ad¬
vantages and Responsibilities—New York Stock Exchange,
11 Wall Street, New York 5, N. Y.

New Issues and

the

Market—Review—C. F.

pany, 1 Wall Street, New York 5, N. Y.
New York Foreign Exchange Market—Alan

eral Reserve Bank of New
50

Chilcls and Com¬

R. Holmes—Fed¬

York, New York 45, N. Y. (paper)

cents.

Packaging Industry

Survey

with

Products and

Sealright-Oswego Falls—Thomson & McKinBroadway, New York 5, N. Y.
Over-the-Counter Index—Folder showing an up-to-date com¬
parison between the listed industrial stocks used in the DowJones Averages and the 35 over-the-counter industrial stocks
used in the National Quotation Bureau
Averages, both as to
yield and market performance over a 20-year period —
National Quotation Bureau, Inc.. 46 Front
Street, New York
4, N. Y.
non, 2

*

American

Cyanamid

Relations

9

$

Company—52nd

Department,

American

annual

report-—Public

Cyanamid

Rockefeller Plaza, New York 20, N. Y.
American-Marietta Company—Bulletin—A.

C.

Company,
Allyn

&

30
Co.,

122 South La
a

Salle Street, Chicago 3, 111. Also available is
memorandum on Commonwealth Life Insurance Co.

Beneficial

Standard Life—Data—Robert H. Huff &
Co., 210
West Seventh Street, Los Angeles
14, Calif.
Borg-Warner Corp. — Analysis — Halle & Stieglitz, 52 Wall

Street, New York 5, N. Y.
Bucyrus-Erie Co.
Memorandum
—

Street, New York 5, N. Y.
on

P.

It. Mallory

—

H. Hentz

Also available is

&
a

Co., 72 Wall
memorandum

Company—Report—Harris, Upham & Co., 120 Broad¬

way, New York 5, N. Y. Also available is the current issue
of "Pocket Guide" with selected lists of securities.

Century Geophysical—Report—Searight, Ahalt & O'Connor,
Inc., 115 Broadway, New York 6, N. Y. Also available is a
report on Alco Oil & Chemical.
Christiana Oil Company—Analysis—Parrish

Street, New York 5,
Christiana Securities
120

N.

about

inflation,

have been added to the
it

is

fact

a

that their

persons on his

t he

new

A

grown.

Senator

but

scene

staffs

from

have
state

a

or

Office

ranging

a

Building, just

$17,000.

Congress¬
a year but

now

and

man

both

into, at

have

of

cost

a

$22,000,000.
has

from $10,000
The highest a
can pay is
$12,400

being

moved

Congressmen

mit

two cafe¬

<;

This is

terias, the two

of

of them taking

much

up

whole

a

ters

dining

the

for
one

in which

they
with

eat

can

their

they

friends
and

Bar^eron
"

and

to

want
roof

sun

than I have

Carlisle

when

another

alone. It has

be

wasted

more

ever

in

seen

a

space

build¬

a

one

has

seven

as

rooms

Senator

are

can

concerned,

But each

use.

can

toilet which is

ator

which, inso¬

rooms

more

It

use.

is

has

one

than

Sen¬

a

the

a

most

ostentatious
in

a

place I have entered
long time.

The

House

is

Co.,

40

Wall

so

Some of them have been

tism have
in the
For

of

of

nepo¬

manifestly unfair

a

example,

was

charges

number of them.

President Truman
the payroll when

on

Senator. She worked at

a

home, answering correspondence,
too. Jack Garner had
his wife,
"Miss Nettie," as his Secretary the
whole

time

Where
the

the

work

he

was

in

Congress.
actually do

relatives

no

criticism

should

be

levelled. After all, a. man wants a

building another
building which means that they
will have three. Only four new

person

Senators and two Representatives

cently in Washington show that it

in whom he has absolute
confidence on | his payroll.
But
of

some

the

cases

Co.—Bulletin—Laird, Bissell & Meeds,

Broadway, New York 5, N. Y.

revealed

& Southern National Bank
Memorandum
R. W.
Pressprich & Co., 48 Wall Street, New York 5, N. Y.
Consolidated Water Power & Paper Company —
Analysis —
Loewi & Co. Incorporated, 225 East Mason
Street, Milwau¬
kee 2, Wis.
Also in the same circular is an analysis of
Nuclear-Chicago Corp.
i
Container Corp. of
America—Analysis—Blair & Co. Incorpo¬
—

—

rated, 20 Broad Street, New York 5, N. Y.
Eastern
120

Industries—Bulletin—de

Wilt

I

re¬

Organization,

Broadway, New York 5, N. Y.

Frigikar Corp.—Memorandum—Kenneth Blair &
Co., 236-240
North Central

Avenue, Phoenix, Ariz.
Railway Company — Analysis — Peter P. McCo., 42 Broadway, New York 4, N. Y.
M. A. Ilanna
Co.—Study—Harriman Ripley & Co. Incorpo¬
rated, 63 Wall Street, New York 5, N. Y.
Great Northern

Beane,

&

115 Broadway, New York 6, N. Y.

licans

have

balancing
and

been

talking about
budget since 1932

the

1934

without
an

in

would

have

they had the

They

avail.

sought to make it
and

issue in 1936
1940 except

third term

talk

to

about.
I

don't think

inflation will
I

me.

that the threat of

selfish

am

enough just

now

inflation

the

have

bought
to

7.

stock

stocks,

at

28

and

it

and

I

market.

of which I
went down

one

It has

all

20

of

in

two

people. Take
ignorant
to want a little

scare

struggled back up to
account of anticipation

on

inflation.

isn't ft paying

It

a

dividend.
my
house
which
under inflation will go

of

own

course,

in

value.

to

to want

enough
sold

I

and

to realize

rented

have

rentals.

I

realize

an

to

enough

don't

that if I

I
inflationary

apartment

pay

that my

would be

age

up

that. I don't have

see

sense

would

ignorant

am

have

to

sense

insurance

reduced.

cover¬

simply

I

look at the immediate paper gains.

There

who

are

look

all

too

it

at

that

way.

younger
active
people
outnumber those who live
sions

fixed

or

to

forced
attitude

greatly
on pen¬

incomes.

believe

and

people
The

many

from

with

those

I

my

am

own

whom

Machines—Data—Oppenheimer, Neu &
Co., 120 Broadway, New "York 5, N. Y.
Magna Theatre Corp.—Memorandum—Candee &
Co., 44 Wall
Street, New York 5, N. Y.
McCall Corporation—Report in "Current Comments for Inves¬
tors"—Francis I. du Pont & Co., 1 Wall
Street, New York 5,
N.

Y.

Also

in

the

same

appear

issue

are

data

on

Of course, we

inflationists don't
anything such as happened
in Germany after World War II.
There, you would start down to
the grocery store with a barrel of
marks and find they had dropped
in value before you could cash
want

But

Atlantic

It

C.

Haas

&

Co.,

65

Glass Company — Analysis
Reynolds & Co.,
Broadway, New York 5, N. Y. Also available is a report

Petroleum

issue

same

Pfizer

North

easy

well

pretty

but inflation

under

Roosevelt

and Truman. But you try to argue
with anyone now and tell him

he

that

has

only

he will say

and

52-cent

dollars

"Yes, but I have

The Administration is

making a
fight against inflation. I
am
afraid they are whistling in
the dark and in spite of my two
heroic

shares

of

stock

don't want to

and

see

my

house, I

it.

MOW TO

GET RICH

BUYING

Corp.

Letter"—Hayden,

are

data

on

Also in

STOCKS
lust published! By IRA U. C088LEIGH, Col¬
umnist, Commercial and Financial Chronicle

Dominion Tar and Chemical and

Your

Massey-Ferguson.
Chas.

that

—

Street, New York 4, N. Y.

the

pretty

was

did

—

Research

Cosden

say

Coast

Supply Company—1958 annual report—Secre¬
tary, Mountain Fuel Supply Company, P. O. Box 989, Salt
Lake City 10, Utah.

on

inflationists

we

can't happen in this country. Why
couldn't it?

Company, and lists of stocks which

interesting.

Parker Hannifin—Data in
April "Investment
Stone & Co., 25 Broad

&

Co.,

Inc.—Analysis—Edwards
Franklin Street,
Hempstead, N. Y.

&

Hanly,

100

exciting guide to

the 60 profit-laden stocks
for the

Plastic Applicators, Inc.—Circular—C. D. Pulis &
Co., 25 Broad
Street, New York 4, N. Y.
Radio Corp. nf America—Review—Ira

surging 60fs.

ONLY

j

$2.50 at your bookstore, or postpaid from
David McKay Co., 119 W. 40th
St., H. Y. 18, N. Y.

Haupt & Co., Ill Broad¬

way, New York, 6, N. Y.
Robertshaw Fulton Controls Company—Bulletin—Schweickart
&

Co., 29 Broadway, New York 6, N. Y.

Safway

Steel Products, Inc.

207 East

— Report — Milwaukee
Company,
Michigan Street, Milwaukee 2, Wis. Also available

are

reports
America.

on

Bought—Sold—Quoted

National Aluminate Corporation and Bank of

Standard Fruit

& Steamship Company —
Analysis — Chace,
Winslow, Inc., 67 Wall Street, New York 5, N. Y.
Texas American
Oil—Report—Greene and Company, 37 Wall
Street, New York 5, N. Y.

UNITED TELEFILMS LTD.

Whiteside &

Troster, Singer & Co.
Members New York
Security Dealers Association

Tractor Supply Co.—Analysis—Herbert E. Stern &

Trinity Place, New York 6, N. Y.

HAnover 2-2400




Teletype NY 376; 377; 378

Memo Available

Co., 52 Wall

Street, New York 5, N. Y.
Tube

74

I

a very

got plenty of them."

International Business

120

& Distribution

was

them in.

Conklin

Owens-Illinois

(b) Natural Gas Companies
Transmission, Production

that

popular thing.
Citizens

Corp.—Analysis—G.
Broadway, New York 6, N, Y.

(a) Operating Utilities

up

turn

not

talk that inflation would be

National

Firm Trading Markets in-

did

talking about infla¬
be highly dangerous
I don't doubt that
in the slightest. But it is ho good
as
a
political issue. The Repub¬

Mountain Fuel

Y.

a

It may

I

been

cases

he

far

aroused

Some

uncle's payroll.
The rampant

it

Republicans

to the economy.

four

pursuing their schooling in Wash¬
ington while on their father's or

had his wife

building. Each

have

per¬

and nieces and nephews on
payroll at relatively handsome

will

into this

Senators

Congress¬
have put their wives, daugh¬

ing. Only half of the 100 Senators
move

reason

attention.

salaries.

Senators,

the

to

the payroll.
that charges

persons on

nepotism

men

block and two
more

and

year

committeeships which
them to put three or

additional

It

Line Railroad, Simmons

&

13

payroll at salaries

Illinois Central Railroad Co.—Memorandum—J. R.
Williston &

Burlington Industries—Data—du Pont, Homsey &
Company, 31
Milk Street, Boston 9, Mass. Also in the same circular are
data on Fiintkote, Hewitt-Robins and Mesta Machine.
J. I. Case

talk

Dermott

Co.

&

But

like New York has at least 12

a

particular

reference to
American Can Company, Continental Can Company, Anchor
Hocking Glass, Owens Illinois Glass Company, Fibreboard
—

if

has

It

work.

good
which would be much

the

proved.

is

rooms
—

Co., Ltd., 61 Broadway, New York 6, N. Y. Also in the same
monthly report are discussions of the 10 Japanese stocks
considered

the

finished

Secu¬

rities"—Shearson, Hammill & Co., 14 Wall Street, New York
5, N. Y.
;
and

one

better

kickback, the

a

little

Republicans
were
guilty.
Twenty-six Democrats have been

people are doing, the most infla¬
tionary thing I have seen recently
Senate

Industry—Review—W.

Inc., 30 Broad Street, New York 4, N. Y.
Chemicals—Discussion in April issue of "Business and

Convertible

all

the Republicans think a lot of

as

Canadian

given
issue,

tion.

In

did

three

By CARLISLE BARGERON

It it understood that the firms mentioned will be pleased
to send interested parties the
following literature:

of

much

so

relative

From

Thursday.. April 2, 1959

.

.

Investments Ltd.
Memorandum
Model, Roland &
Stone, 120 Broadway, New York 5, N. Y.
United Telefilms Ltd.—Report—Meade and,
Company, 27 Wil¬
liam Street, New York 5, N. Y.
Wilcox

—

Gay

Corp.

—

Memorandum

Street, New York 4, N. Y.

—

—

Darius

Inc., 90 Broad

Meade &

Company

27 William Street, New York 5, N. Y.

Dlgby 4-7930

Volume

189

Number 5834

.

.

.

Sumner

$52.8 Million Bonds

Turnpike

under

An

underwriting

group

headed

by F: S, Moseley & Co.,
The First Boston Corp., Blyth &
Co., Inc., and Tripp & Co., Inc.,
plans to offer on Thursday, April
9, 1959, $52,800,000 Massachusetts
Turnpike Authority tunnel rev¬
enue bonds.
;.rI. •

jointly

r

The bonds are to

the

foe issued for

acquisition from the City of
of- the present two-lane

Boston




between

Boston

adjacent two-lane tun¬
The, bonds will be issued

nel.

Authority to Be Sold

Tunnel

and East Boston and the construc¬

tion of

Of Mass.

(1529)

The Commercial and Financial Chronicle

NY

Security Dealers

an

separate trust agreement

To Hear Dr. McFarland

and
Paul
Windels,
New
York
Regional Director for the Securi¬
ties and Exchange Commission.

held

rately

Kenneth

payable from different

connected with

be

Dr.

and

its operation will

administered

from

the

Turnpike.;

sepa¬

Massachusetts

an

the

New

C.

Werle,

York

Edward T.

Chairman

Stock

of and

later

Director

was

of

Exchange; nomic Affairs for Germany

Eco¬

and

TOPEKA, Kans. — Walter I.
Cole, Jr. has joined the staff of
Beecroft, Cole & Co., 117 West
Sixth Street, members of the Mid¬
west Stock Exchange, in the mu¬
nicipal department.
Mr. Cole has recently been with
Smith, Barney & Co., New York
City.
' "

With Midland Investors
COLUMBUS, Ohio—Jacqulyn S.

McCormick, President Chief of the Economic Coopera-. Pace

of the American

;

This is not

Edward

W. I. Cole Jr. With

Beecroft, Cole Co.

Robert M. Hanes
McFarland,
of
General Motors Corp., will be the
Robert M. Hanes, President of
revenues
than
the .outstanding
guest speaker at the 33rd annual the Wachovia Bank and Trust Co.
bonds of the Massachusetts Turn¬
dinner of the New York Security of
Winston-Salem, N. C., passed
pike Authdrity, which were issued
Dealers Association to be held at
away
March 10.
Mr. Hanes, a
in
1954
to
finance
the
Massa¬
the
Waldorf-Astoria,
tomorrow former President of the American
chusetts Turnpike. While the tun¬
evening, Friday, April 3.
Bankers
Association, served as
nels
will
be
operated * by
the
Among the prominent
guests Chief of the Marshall Plan Mis¬
Turnpike
Authority,
all
funds expected to attend the dinner are sion to Belgium and Luxembourg,
a

and will be

Stock

Exchange, tion Administration at Frankfort.

tors

offering of these Shares for sale, or a solicitation of an offer to buy, any of such Shares,
The offering is made only by the Prospectus.

2,000,000 Shares

Common Stock
($5 Par Value)

These Shares are being sold to the Underwriters by The Ford Foundation and no part of the
proceeds will be received by Ford Motor Company. Copies of the prospectus may be obtained
from any of the several underwriters only in states in which such underwriters are qualified
to

The First Boston

act

as

dealers

in

9

securities and in which the prospectus may legally

be distributed.

Corporation
Goldman, SacliS & Co

Lehman Brothers

Merrill Lynch,

Pierce, Fenner & Smith

Incorporated

is

now

with Midland Inves¬

Company, 52 East Gay St.

The Commercial and Financial Chronicle

10

.

.

(1530)

demand in practi¬ buy, and thus further depresses
cally all lines, yet we are spending;, world trade.
some $30 billion for new and ad¬
v As
these more important
de¬
ditional facilities this year.J
mand and supply factors indicate,
Productivity has increased and ; business wiJU.be good in 1959. But.
is continuing to increase. Some $8 don't bet on a runaway boom!
11
billion a year is being spent -on
.New
European
Developments
research
research in methods,

.

Thursday, April 2, 1959

than ^effective

Will Business Be Too Good?
RAYMOND RODGERS*

By

Professor of Banking, Graduate School of
New York University, New

Business Administration
York City

—

"cold water" on exuberant optimism said
Washington, Wall Street and Main Street
about the immediate future, Mr. Rodgers cautions "business
will be good in 1959 ... [but] will not be as good as {the sta¬
tistics, as comparisons will be with the recession levels
last
spring." The Professor also refers to the growing domestic
aitd foreign competition; factors precluding demand-pull type
of inflation in near future; and to new European developments
In dashing a little

be emanating from

to

'

<

.

saying that
like success."
The same philosophy applies to
business activity. When business
is slowing up
end you look
is

There

•'nothing

an

old

succeeds

those

down

declining
trend lines
your

on

charts, it

difficult to
keep from becoming too
blue. By the
came
token,
as

when

all

j the

trends

are

ris¬

ing, there is

a

great tempta¬
tion to become
Dr.

over-optimis¬
tic and

Rodgers

just can't miss this

we

In this vein, the black pes¬

simism

of

last

spring

has

been

succeeded this spring by an opti¬
mism that is "beautiful to behold"!

The Administration

Is

Optimistic

The Administration in Washing¬
ton is very optimistic. In the State

which the President, by
law, sends to the Congress each
January, this optimism was set
forth in quantitative form as well
as in philosophy. The Budget Mes¬
sage, for example, estimates total
papers

revenues

from

$77,100,000,000,

fiscal

1959-60

of

compared with
estimated receipts of only $68,000,€00,000 for the fiscal year ending
June 30, 1959, and actual receipts
of
$69,100,000,000 for the year
which ended June 30, 1958. Even
though the revenue of certain
minor

new

as

taxes is included in the

1959-60 estimates, the basic nature
of the Administration's optimism
is

clearly shown by the fact that
during the fiscal year ended
June 30, 1957—a year marked by
a high level of business activity
and full employment—the reve¬
nues of the government amounted
to only $71 billion.
It is, there¬
fore, quite clear that the Adminis¬
tration expects business activity
during the coming fiscal year to
be
at
the
highest
level ever
Oven

reached

in

the

United

States

in

peacetime.
Another indication of the opti¬
mism of the Administration

-Clearly

can

be

•

j

Despite the growing optimism
increasingly favorable statis¬

their families do not go on spend¬

ing sprees!

be good in 1959, you should not
ability of funds and higher inter¬
anticipate runaway activity. In the est rates, is our ehief method of
immediate future,
business will reducing the demand for goods
not be as good as the. statistics, as
and services. Such credit restraint
comparisons will be with the re¬ in mild form has been
underway
cession levels of last spring. And
since last summer, and there is
further along in the year, growing
every reason to believe that the
competition from Europe and the Federal Reserve authorities will

<000 in fiscal 1958.

rived

more

from

startling is the

ex¬

de¬
income

revenues.

corporation

taxes. These are placed at $21,448,€00,000 for the next fiscal year, as
compared
with
$17,000,000,000
during the present fiscal year.
The

Congress Is Optimistic

Congressional attacks on the
President's Budget as pinchpenny,
niggardly, and endangering the
country indicates their optimism—
"and their willingness to spend.
Which, of course, will help make
their optimism come true. In fact,
as you know, one of the greatest
dangers in the country today is
the naive, 'Or -worse. Congressional

tics

business activity,

on

Credit

belief that, although business will

Reserve,

rest
on

of the -Free World will press
over-all business activity.
,

our

The
war

economic

to

.dislocations

address

by Prof. Rodgers before
Cite Glassine & Greaseproof Manufactur¬
ers Association, New York City.




of

forget

that

the

two

most basic factors of business life

A

still

supply and demand.

brief

analysis of the supply

and demand

factors-operating and
developing in our economy—and
the world economy, as the rest of
the world is again
competing with

us—will give
road ahead.

a

those nations the need to prac¬

restraint

by the Federal

discipline

with

lessened

its

avail¬

On Far East

its currency. This,-of course, has gram.
aggressive- in their
Mr.
far-reaching implications for the
policies if, and to the United States.

more

restraint

extent, needed.

better idea of the

Supply Factors

Remember,

Trust

?

"

since

the

end

of

-

II alone, it has been
repeatedly demonstrated both here

credit

over

an

restraint

will

inflationary

prevail

boom,

no

matter how aggravated.

World

price weakness in basic

commodities has T)6en
for

.more

As

economic

ing prices'have dealt severe blows
raw

analysis of supply and
and international

visit

correspondents

Northerns'

in

Japan,

Hong Kong, Thailand, Singapore,
the Philippines. He will also
handle
assignments for various

Mr.

Read

had

more

than

10

years' experience, in the Far East
before

joining

Northern

the

Trust in

staff

of

The

1953.

labor, if we are to hold our

and

Two With Columbine

competitively.

(Special to The Financial chronicle)
*

~

Joins L. A. Caunter

;

(Special to The Financial Chronicle)

mate¬

Thisjhas
Production-capacity is-great and
increasing.
Capacity is greater adversely -affected their ability io

will

Chicago-area corporations which
'
developments indicates, 4J0 business in'the Tar East.

CLEVELAND,
rials producing countries.

|

>

Read

and

business
will
be
good
in the
months,-ahead. "But competition
will be rough and will require the
best efforts of both management

problem
Declin¬

this

Trip

demand factors

own
a

than two years.

to the economies of the

Conclusion

•

World War

and an many countries abroad that
a determined and resolute
policy
of

Read of Northern Trust

currencies. Obvi¬
ously, if inflationary pressures in
one country develop and
are not
CHICAGO, 111—George S. Read,,
counteracted by fiscal and mone¬ Vice-President and
Manager of
tary discipline, the balance
of the Foreign Department of The
payments of that country will turn Northern Trust Company, Chi¬
adverse, and it will lose gold and cago, is presently, on an extended
hard currency and thus be unable
trip through the ,Far East as part
to iftairitain the convertibility of of the bank's regular
calling pro¬
bility of their

,

ernment intervention of. the past
20 years have caused some busi¬

are

become

and the artificialities of gov¬

nessmen

.

in order to maintain the converti¬

my

View that the American economy
♦An

it is

on

tice fiscal and monetary

placed at $40,700,000,000, as com¬
pared with estimates for the curTent fiscal year of $36,900,000,000
and actual receipts of $34,724,000,-

increase in

v

,

and

seen

Even

re¬

In addition to the conventional
quiring brokers and /dealers to f.
supply and demand factors, there
file statements, this law is ex- is bound to have a favorable ef¬ are two. new European develop¬
fect
on
of
productivity. Moreover, ments
great
importance
to ; peeled to close the gap in wiping
out. any criminal elemepts and /
the enormous plant and equipment American business.
Both have a
expenditures of recent years, with direct
bearing:, on competition,
"boiler-room'! operations.
,
their heavy emphasis on substitu¬ here and abroad, and • both are
New
York
State's
Attorney
tion
of
automation
for
human; highly significant in the
battle
hands, are having a growing fa¬ against inflation.
v
i General, Louis J. Lefkowitz, ;oil
March 27 hailed the passage of a
vorable
effect
on
productivity.
The return to limited converti¬
can support any level of spending,
bill by the 1959 Legislature which
And, of course, the profit squeeze
bility by several Western Euro¬
he said will help his office "launch
or
taxation, that they see fit to of last year's recession
caused pean countries at. the end of 1958
a full scale attack on boiler room
impose.
management to redouble efforts to indicates that their economic re¬
security salesmen operating with
secure economies and reduce costs'
covery has been completed, and
Wall Street and Main Street
batteries of telephones in the fi¬
all along the line.
that; /their balances of payments nancial district."
Are Optimistic
:
Competition is very keen, and are considered adjusted. It means
Wall
Street
is optimistic.
The unprecedented
legislation
it is getting rougher every day/ that their fear of a dollar shortage
will require approximately 30,000
Whether the high level of equity
Not only does the American busi¬ has passed and that the dollar is
security salesmen in New York
prices is primarily the result of
nessman
face
stiff
competition
not,
as "jhard" as it was for many
State to register for the first time
the fear of inflation or is largely
here at home from other Ameri¬ years. Their return to limited con ¬
with Attorney General Lefkowitz'
anticipation of increased corporate
cans, but he must face growing vertibility also means that they dov office.
- .vitesfc
earnings, the fact remains that,
competition from foreign p r o- npt believe the Berlin impasse
"The law prior to the passage of
in either event, business is ex<ducers who have, perhaps, ' even, Will develop into a serious crisis,
this
measure
required brokers and
pected to be better—much better!
more modern
machinery than he and that they consider the inter¬ dealers in securities, to file a deal¬
Main Street which, of course, is
has, and who certainly have much national
political
situation
as er's statement but did not provide
far
more
important than
Wall
lower labor costs, with the result more hopeful than we do, or else
for the registration of the sales¬
Street, is also optimistic. In fact,
that they can undersell him in his they would not have dared to re¬
men whose
slick pitches are the
of the many reasons for believing
own front yard. And, of
turn
to
even
limited
converti¬ instruments
course,
if
used to victimize the
that business will be good in 1959
he tries to compete with them in
bility.
the
most
unwary
investor," the Attorney
important one, un¬
foreign markets, they have still
General said.
doubtedly, is that the man in the
The establishment of a Common
further cost advantages over him.
street—your "customer"—is con¬
Market on Jan. 2 by six European
Registration Every Four Years v
vinced business will be good. This
Demand Factors
countries is another step of great
is more important here in America
Strongly supported by the New
On the demand side, while it is,. significance to American business.
York Stock Exchange, #ie Ameri¬
than in any other country, as our
of course, possible for the Ameri¬ Under the Common Market Agree¬
can Stock Exchange and the Na¬
people are always in a position to
can people to go on an inflation¬
ment, the various member coun¬ tional Association' of. Securities
buy with income, or savings, or
ary spending binge, it is my opin¬ tries with respect to one another Dealers, the bill will
require sales¬
credit, if they are in the mood to
ion that they will not be so foolish., reduced tariffs by 10% and also men to
register every four years
buy.
Fortunately, so far, inflation has reduced quota barriers on im¬ with the Department of Law and
Putting it differently, psycho¬
manifested itself only in the stock ported goods. As these reductions execute a statement
setting forth
logical factors are more important
market, in the price of farm land, are supposed to be merely a first their full background and experi¬
in the American market than in
and in the prices of certain aft step toward a virtual elimination ence and all details relating to
the market
place of any other
objects. As far as the overall of trade restrictions, they have any prior criminal record.
country. The reason, as you know,
economy is concerned, cash saving started the creation of a new eco¬
The bill will be another weapon
is that our standard of living is so
in commercial banks, savings nomic unit which will be some¬ to
help in ridding the securities
high and so many of our pur¬
banks,
thing
on the order of an economic industry of the fringe of unscru-..
savings
and
loan
associa¬
chases are optional, or postpontions, and in the increase in cash United States of Europe.
pulous salesmen who give a black
able, that the decision of consum¬
value of life insurance, continues
The establishment of the Com¬ eye to the legitimate dealer and
ers in those areas alone can spell
at high and
record-b reaking mon Market and the return to salesmen. Last year, on the rec¬
the difference between poof busi¬
levels.
ommendation of Attorney General
limited
ness and good business.
convertibility
will
in¬
There are many factors on the crease international competition. Lefkowitz, a law was enacted per¬
The
quick recovery from the
demand side which warrant the The
Common
Market
countries mitting an application to be made
lower levels of business activity
conclusion that there will be little undoubtedly will reorganize their to the Supreme Court to bar a
and the pessimism of last spring
inflation of the demand-pull type; industries
and
engage
in mass person with a felony conviction
has had a profound effect on the
or a conviction for a lesser crime
in the next few months. Among production on a larger scale than
psychology of our people. The fact
the more important factors are the V ever before. Foreign nations sell¬ involving securities from engag¬
that thi? sharp recovery was from
ing in the securities business in
ing to Great Britain and other
the third, and the .most serious, following.
New York State.
countries with limited converti¬
of
our
postwar recessions
has
Unemployment continues large
The bill also clarifies the law
caused
most
people to feel not despite the recovery in business bility will now be able to buy which permits the Attorney Gen¬
wherever goods are cheaper
or
only that depressions are things of activity. Although unable to sell
eral to serve process on individ¬
quality is higher, or delivery is
the past, but that recessions also all the available labor at
uals who reside outside New York
present
quicker.
As
costs
of
production
in
have been mastered.
wage rates, labor leaders continue
State but engage in the sale of
Europe are lower than
in the
securities here by permitting serv¬
So, whether you look in Wash¬ to demand still higher wages. This United
States, and those countries ice
upon tne Secretary of State.
ington, Wall Street, Main Street, policy, and the growth in the are nearer to one another than to
or
Salesmen of member firms of
your
own
board room, pes¬ labor force will keep unemploy¬
the United States, it will be even
ment
at
New
York Stock Exchange, Amer¬
simists are harder to find than
high levels. Even though
more, difficult
for American ex¬
ican Stock Exchange and the Na¬
economic
modest Texans. Does this mean the
security
of
our
porters to compete abroad.
tional
Association
of
Securities
that you should plan for a boom, people is great, and unemploy¬
And, finally, the fact should be Dealers have previously been re¬
with an inevitable reaction later ment benefits, in particular, are,
on? In short, will business be too substantial, it is beyond question borne in mind that the return to quired to register with the ex¬
limited convertibility will impose changes and the N.A.S.D.
that
unemployed
workers
and
good in 1959?

from their estimates
Of individual income tax receipts.
Such receipts for fiscal 1960 are

pected

Supplementing existing law

;

.

con¬

clude that

time.

R.

systems, and operations, as well as
in products and pure science/ This

Salesmen «f N. T. Stale

-E. Crosbie Jaas

Ohio —William

joined the staff, of
L. A. Caunter & Co., Park Bldg.

DENVER, Colo.—Alvin Jacksonand Richard D. Strachan have be¬
come

affiliated

with

Securities Corp., 621
Street.

Golumbine

Seventeenth

Number 5834

189

Volume

.

.

The Commercial and Financial Chronicle

.

(1531)

ments

Why We Stand at the Beginning

thoughtfully.

more

this

that the

into-

ever

small

By J. BRUCE McWILLIAMS*

;

:

•

v

;

is the order

v

?

T

v.

sales

•.

importer

car

traces

at

so

of; the day, just

be

a

such
cause

cars

again

so

years

that

—

the.

and

there is

undeniable part
this
car.
These

an

,

„

the

being

question
•
raised

more

and more

-

in

duplicated

and

is

That

of

*

Walker

The

truth of the matter then

is

-

mobile

.

vent

the ad¬
of small

cars

from

With

sions.

to

neither

lSeff^able

of thp prnnoitiv

arc

Y

tvoo

omy type,

' So, finally, we ask which of the

.

European companies will be able
with the titans of

McWilliams

V to
compete
' Detroit
and

Import Data
■.

.

Jhpn^oml
^ster^d
companies need not compete with

^i

of the importing companies?;/Detrmt on a unit for unit, basis.
Will the 76 European companies
next
appetites of .the European
which the Department of Commakers are
more modest. De-

sevm^

19J%\

lists

as

the

able

to

weather

and

pressures

be

of

forth
forth

send
to "send

begin

un-

companies

A-

-

Detroit

will

the

when

"

competition

the

that

•

.

*

'

.

•

aearly 5A0U0vumts. inen intiyoo,

a

Detroit0

I

_1

rare

pond

oT

think

can

to

came

that

at

par?

but

ugp

wound

whp.pa,

- - •

VJ

;

,

.

.

.

f'

*'

.

j

Size of U. S. Car Market

*\

■

-

For

let

moment

a

nearly

million

and

roads

-

Just

the

as

or

rate

of

are

today

world

the

some

and

canr

82

of

and

this

a

-

will

a

am

cars,

Stand

We

annual r.

mainly

economy

at the

would 7-appreciate,
immense'
possibilities {it

what

disputed

.This fact has

bearing,

on

fore

an

.

address

the

.

by; Mr. McWilliams be-

Automotive

York city.

un-

market

the

—

*An

Press

x




will

not

be

the

change,
in

■*

*

,

Club,

New

and

has

offices

as

for

the

failures

as

competition from Detroit.

For Detroit and importer alike,
are entering into the most ex¬
citing-and fascinating period in
we

the entire

history of the American

automobile business.
the

Financial Service
CHICAGO, 111.—Introduction of
a
new
type of financial analysis
service has been announced
by
Frank R. Anderson, veteran Chi¬
cago financial analyst. Mr. Ander¬
son
opened
Financial Research

For those in

Associates, 120 South LaSalle St.,
on April 1.
His firm will under¬
take special financial analyses for

industry, the, stimulation and

investment

■

,

bankers.

V

,

ation

Twenty-five Year 4.35% Sinking Fund Debentures
.

Due April 1, 1984

I

■)

Price

100%

(plus accrued interest)

announcement

securities. The

constitutes neither

an

offer'to sell

nor a

solicitation of

*

securities

in

legally offer these

in America meets the

Smith, Barney 8i Co.

..

The First Boston

Kuhn, Loeb & Co.' W. E.Hutton & Co.

Corporation

'

'

'

Blyth 8C Co., Inc.

Eastman Dillon, Union Securities 8C Co.

♦

"

Incorporated

in

commercial life, the
will begin to engi-

Lehman Brothers

hazard Preres & Co.

.

,

Stone & Webster Securities
April 1, 1959"
.,

-average person
.

neer

nis

transportation

require-

Glore, Forgan 8C Co.

Kidder, Peabody & Co.

Harriman Ripley &. Co.

Goldman, Sachs 8C Co. *

:

k

-

would be
hoth wasteful .and costly^ And^so,.
as

offer to buy theft
" .

compliance with the securities laws of such States.

Corporation

extra and unused space
just

an

offer is made only by the Prospectuscopies of which may be obtained

from the undersigned'oply in such States as the undersigned may

.....

:

,

New

Anderson Establishes

/

USui
to phartei: - iarge_ > sh ps <
capable of carrying 1,000 cars to..
America when we can ardy^m^
50d available for- shipment.

in

Providence,
Bridgeport,
Hartford, White Plains and Clay¬
ton, Missouri.

'

\

member

York,

•

This

a

founded in St. Louis

was

1900

^

Beginniitr^;>^

,fooli®b
ample,

you

holds forth.

only

(1

needs of at least 50% of our transportation requirements. It is in
fact a little silly to keep on arguing about, big cars versus small

half

rough idea of how big the automarket in
America is—
-

those

number

citing these figures to give

as

that

will be

Co.,

<»

;

.

J

ear today

in

mobile

and,

size

Mere

account

much

*

) I

seven

Arm co Steel

'

cars—that you are in one camp or
56 million are running right here the other—that they are two quite
in the U.S.A. That leaves 26 mil- different faiths. The question is
lion for the rest of the world, or not whether it is large or small
just half of the U. S. total.
but is it right. It would be quite.
million

founding,

New York Stock Ex-'

$75,000,000

tion, which is the big one, by saying that it is my belief that we

of

the highways

on

sense.

1 his thought brings us back to
th® question I raised at the beginning. Is this the penultimate year?
What about penultimate plus one,
and beyond? Where is this market
lor small cars going, or likely to
go? I must answer the last ques-•

this country is towering so also is
the
number
of
cars
registered,

There

suggested
or

number of good and we have ever known and for the

-

annuai

of

Germany,
more than

scrappage

six

the largest ones. This is naive non¬

G. H. Walker &
firm of the

v

of

roads

France,

as

associated

years.

,

such stand at only the beginning of the
small car market. You cannot irideor
Canada.
We scrap
under a bushel, you canirbt deny
five times as many cars as are on
something that is so ' basically
the roads of Sweden, to give still needed and sensible as the small
^another example. "
~
V ear. The small car; the economy
the

on

countries

two

here" long enough
enough to
to challenges will far exceed those
here'long

'

registered6 '

lveiaee

/;

more

many

next

;,

has/ reached * proportions
which'Detroit can no longer over]0ok.
/. ■;. * ^; u J *
- YY
^
v:" * \;v- fv

one-half

the

on

are

Britain,

thanvjare

been

cars>

cars.

than

Great

have

with that firm since its

to

car

imported

Or^ if we take in
cars, trucks and other commercial
Vehicles, some five million machines annually end up in the
nation's junk yards. To give you
an idea, we scrap each year more
cars

then

ways

chosen

•

In

for the < last four years
bas been 181,400. The market for

automobile

and

four

up?

kept

average

think it is
.important to;;appreciate its dimensions^ It is, in fact, so big that
people in other countries really
can't comprehend it.
For exampie, in this country we annually
scrap

the

the

I

market, comprises.

the

swing

..

limit might be, •.:

4 to: only 13,400 units, the

consider

us

American

the

what

mentioned

Sesimported
In the®first slven years ^
market amounted

slm\tofateWiI' 0bVi°U y haVe'a
•.

began

many

the

pacey be

3^^

folding their tents and
stealing' away.
Others*

silently

weather

when the Detroit compa¬
into action. It is al¬

years,

^
^le oTtoDortS' aX ^
aSain» the sale of imported auto- r

their

—

to

nies

February» registration figures for

several

sell

what

cou|d

that

At

204,000.

to

1957;

in

wonder

for years,

fcompanies that

-

point>

been failing in
without being

have

companies

Almenca

r -

^

doubled

been
been

eayn a large

again
to
97 qqo units and in 1957 they more

they ' almost, doubled

..

single generalization
wiU not answer the question. For
that matter imported automo.oile
Actually,

far

over the
to have
iiave
uvei,
l"50 previous
nnnV1U"+ year,' 1rising
Vqrr

a
a

great metal stream of small cars?
6

A

^he

J*1^

^e^year-ipen<^ng 011
company, the U S.
fY'% fnn ^Thin in iq^ f.v>?n, 'qan be a whale of a good market
of x3'^° unlts- Then in 1955 small 011 a saieof anywhere from 3,000
cars began, to ,ftnd thenr place.in ijq:,. ,100,000•*; cars '< annually.. And
tbls ™arket ?
sales | doubled make no mistake, European cars

selling their autoUnited States be

in

leashed

Jolley,
Charles. S.
Robert P. Disse and
Bergin, officers of the
Fotheringham firm. The first four
William R.

from

keep

many

mobiles

able

arbiter.
Indeed, one or two good
being sized outfits could well come down
For a moment let us look at the
with
an
absolutely
thunderous
pushed Wck int0 the Atlantic. Of
record of
roar
in the next couple of years.
imported car sales in COurse, in
asking this question you
To be sure, many will go and lew
commenr ed i
1948
thust Appreciate that European will remain but sheer ineptitude
Car

.'

J. Bruce

pol'tion of those mil-

a S°od

'ijq-,-,

■:*;v

horizon, will this be the next
the last year in America

merce

Alma

Lottmann,

Surely

one

willbe operating on U. S. roads,

tb

'
Cites

all

companies unthe

quintuple the earlier*4

^The U.S.A. we are approaching the moment
makei^ that when the millionth European car-

demand nor sen—
sibly anticipate its future dimen-

the Detroit

of

European

l/iri
,,!! wf+h fhi
keep up with the

the

Slates.

United

market.

have

many

com-.

panies ;in

the

fixbn

; auto¬

ported

many

Miss

,

automobile

the:.
im¬

of

Car Market'

that

Co. St. Louis
office,
Street, effective April
1, 1959. This brings to the Walker
organization J. H. Fotheringham,
&

Locust

.

and elsewhere

regarding

markets

!

Joins 6. H. Walker

503

_

traditional

choose

.

challenging problems and situa-* and prior to 1932 they had. all
European ' automobile V manufac.^. within'the next 10 vears," if not a "tions, but if the skill is there, they: been associated together in the
turers were accustomed
towelling good .^eal sooner, .we will see a will cope with these and continue St. Louis office of John NickerAustialia,New Zealand,-Can-r b^fket in this country for-2V2 to prosper. A number of times son and Company. William
R.
ada, these ancL manyothers have milii0]A Small cars
a'year. Tn to- lately, there have been stories in Bergin joined Kerwin, Fothering¬
been
eclipsed
by the .immense day?s
market> that would be half the press saying that only six or. ham in 1937, after being with the
buying power; .of the Ameiican 0f the total number".
Even today, seven importing companies will be Mercantile
Trust Co. for many

i the trade press :

future

the

in many

to

LOUIS, Mo.—Kerwin, Fotheringham & Co., securities dealers
in St. Louis since 1932, have an¬
nounced plans to join the G. H.

"

Predicts Z1/* Million Small'

his

ST.

«

company's prospects

„

„

:

in

frequently

.

Year?"

Penultimate

the

to the importer

as

be

Kerwia, Fotheringham
.,

simply this. The importing com¬
panies with topflight management
of survival when Detroit reacts—which he believes.is inevitable
^ v-Several years ago, I believed and" marketing skills and with
...
,
^that the market for small cars products of undisputed merit need
Recently, an editorial appeared for small and imported cars.
In eould reach 500 000 units arinu- not fear for. the future of their
in
a
leading national magazine a few short years, the United aiiv\: Tt is certmniv time for n hew market in America. To be sure
that carried this headline—"Is this States has risen up to outstrip all
prediction and .1 "would like to they will be presented with

himself to the question

many men

will

from.

thing or the other, which
Americans are
simply - disregards
our
'varied looking for such qualities and will
transportation needs — disregards now settle for nothing less.
them in the way that Detroit has
Fate of Importing Companies
done in building only large cars.

one;

genius of

countries

impossibility, for example,
Detroit company to create,
a car as a SAAB
simply be¬

things cannot be
yet many, many

assumes

it can be a golden age
which the artistry, imagination

consumer

in

Americans,

Sweden

of

outmoded—to" say
that it must be

are

of

an

for

as are

say

and

buying
certainly
where cars are concerned, have
become more discriminating, more
searching, more varied. It would

accel¬

an

friends

tenance. .This is not to
large

of imports

to 373,000 in past 11

cars

tastes

rising costs for gasoline and main¬
5

from ? 15,422
and predicts a
2*4 million small car market here within the next decade.
This deduction is based on the premise that the purchase of
small cars Will continue by buyers desiring to avoid the costs
and waste of extra and unused space and that this does not
mean large cars are outmoded. Mr. McWilliams also addresses
Foreign

registered

loyal

coming

erating rate. The short haul, the
one or two occupant to a car trip

Vice-President, SAAB Motors, Inc., New York City,
'

It is in

greater prominence, and

will continue to do

Of the Small Car Market

is

car-

11

•

'

-

•

*

•'

-

Merrill

Lynch, Pierce, Fenner & Smith
Incorporated

White, Weld & Co.

,

j- >

Dean Witter & Co.

The Commercial arid Financial Chronicle

12

.

Thursday, April 2, 1959

.

.

(1532)

the facts that there was such

heavy concentration in bonds, and

a

With -WiUon,

.

V :i~'

the bond market was so poor*

Johnson

?

('Special to The Financial Chronicle}

Bank and Insurance Stocks

Ten-Year Statistical Record—Per Share
Adjust.

Llq.

Und.

Value

By ARTHUR B. WALLACE

This Week

Insurance Stocks

—

GOVERNMENT EMPLOYEES INS.

Employees

Government
is

Insurance Company of Washington
lha$ it was set up to cater essentially
municipal employees. At its organization it

unique organization in

a

Federal*, stat^fmd

to

CORP.

similarly titled com¬
pany. There were then 1,000 shares of $100 par value per share.
Capital at the end of 1958 consisted of 1,334,570 shares, the par
now
$4.00; and to this was added in February, 1959, a stock
dividend of 2%.
The company is licensed in all states, and in
liabilities of

absorbed all of the assets and

a

Hawaii.

Affiliated with the company are Government

Employees Cor¬

ing the new field of writing variable annuity policies, may elect
proceed with its financing now that the Supreme Court has
eliminated any doubt that this business is subject to regulation by
the Securities and Exchange Commission, rather than exclusively
to

jurisdiction of the various state insurance supervisory

under the

referred to,

bodiep. Government Employees Corporation, already
auto finance business.

is inrthe

principal writings are auto bodily injury, auto property
damage, and auto physical.
Of late fire has been added in a
insurance company's policyholders

the

As

:

regarded as

are

preferred risks—teachers, active and reserve commissioned of¬
ficers, etc.—premium rates in., general are 20% to 30% below
usual rates in almost all states in which the company is licensed.

its categories to

at present is seeking to expand
include other preferred risks.

The

company

The

exceptionally low expense ratio is due in large measure
that there is no agency plant business being written

the fact

Washington.

by direct mail with the company itself in

Dir.

High

24%

9%

Third Street.

19%

15%

$3.10

$1.39

$0.12

$0.48

$3.03

3.80

1.17

0.17

0.47

0.87

0.16

1951___

4.37

1.12

0.23

0.51

0.84

0.18

15%

1952_—

5.61

1.89

0.31

0.70

1.50

0.23

24%

15%

1953—

7.29

3.00

0.40

0.45

2.95

0.27

32%

20

1954,—

10.39

4.74

0.58

2.55

2.77

0.38

29%

16%

1955

12.44

4.49

0.67

2.33

2.83

0.49

32

26

12%

*

1956—

12.46

2.53

0.75

1.35

1.93

0.62

331/4

27%

1957_—

15.1.9

2.22

0.99

0.76

2.45

0.75

47%

26%

1958.__

21.34

5.26

1.19

2.80

3.65

0.95

112

dends paid:

Statement of Condition—Dec. 31,

:;u,

staff

1958

Gov't Bomte.

S.

has

State

&

Bonds.

Munic.

Corporate

v

..

Bonds

~

Mitchum, Jones* & Templeton, 650 South Spring Street,
members of the New York and
Pacific

Coast

Stock

8,080,302

Real

5,194,024
251,349

Estate

Interest

Accrued

from

Due

—

Affiliate

_

Exp..

.

.Accounts

Capital
Surplus

16%% in 1950; 14 2/7% and 25% in 1951; 10% in 1953;
in 1957; 100% in

important contribution to this growth; and we have seen few
in which volume fop volume's sake paid off as choice

cases

risks do!

Stock.

Colonial Trust

Company
of

1230

20,

visions

N.

of

Y.,

Writing its

$G9,0G2,GG9

Injury

16,341,000

U. S. Government Bonds

24.8

30.3

Bonds
Stocks
Stocks

of

of

Stock

Federal

of

Reserve

a

member

of

Texas.

Texas,

tures

120,000.00
39.383,703.89

.

discounts

and

Bank premises

owned $202.-

furniture

325.58,

of

Association, and is

Louisiana

...

-

fix¬

and

520,714.23

$204,388.05

Customers'
bank

liability

this

to

acceptances

on

standing

out

1.175,240.57

J,

:

Other assets.

507,133.11

.

Illinois

and

$77,891,048.31

ARRETS

LIABILITIES

of
indi¬
partnerships, and
corporations
$48,331,957.94
Time deposits of individuals,
partnerships, and corpo¬
rations
0,244,133.54

deposits

viduals,

Resurrection of ^eate
,'::,%I3 civilization

Will

two

'

myth and love of the Nazarene only

a

figure of speech?

a

Deposits

/

thousand

of

years

And

all

twinkling of
gen bombs?-

of

education,

and

an eye

ideals

ical

be

destroyed in the
by manmade missiles, atomic and hydro¬
,;.v
%%%• '
over

out

to

tjhe

conquer

our

two

world

loving world,

boast

Acceptances
for

billion people on this orb

whims

of

a

for

their

we

"cold

own

ambitious

curse

of all

wars

shall become

a

$2,200,000.00

......

_

2,700,000.00

Undivided

profits

Reserves tand

TOTAL

1,196,744.79

retirement

ac¬

preferred capital)

155,508.00

CAPITAL

ACCOUNTS

-

.

$0,252,252.79

_

.

TOTAL LIABILITIES AND
CAPITAL ACCOUNTS-.. $77,891,048.31

bank's

*This

/

debentures

with

total

capital consists of: capital

$700,000
par

and

stock

common

value of $1,500,000.

MEMORANDA
Assets

pledged or assigned
to secure liabilities and for

memory

history.

other

-

I,

$3,704,604.81

purposes

Charles

F.

Bailey,

Vice-President &
bank, hereby
certify that the above statement is true to
the best of my knowledge and belief.

By ALEXANDER WILSON of the "Chronicle's" Editorial Dept.

Even

1.312,075.01
1,043,908.88

CAPITAL ACCOUNTS

CapitalSurplus

would remind them that:

age

war," and the

or
bank

liabilities

Other

heraldry, the pomp of power,
beauty, all that wealth ever gave,

in the saddest pages of

this

of

outstanding:

TOTAL LIABILITIES-— $71,038,795.52

of miracles is not past for in spite of violence,
greed and hate we shall, with God's help, see the end of the

—2.6

executed by

account

and

Kaiser Wil-

a

/ The paths of glory lead but to the grave."

conservative investment

1.259,353.78
•
"

.....

DEPOSITS $09,282,751.03

Await the inevitable hour,

The

11,980,001.18

deposits (certified and
checks, etc.)...

TOTAL

of

And that

900,000.00

officers'

of Communist adherence and to other enemies

freedom

400,705.19

...

subdivisions

count for
men

States

Deposits of banks

noblest

Aren't the souls of

United

Deposits of States and polit¬

Other

man's

of

Government

religion,

achievement go for naught?

"The

12.5

a

1.090,000.16

/Tientures

admitted to practice in the States

Vinson, El-

aiid de-

Other bonds, notes,

Demand

6.0

Treasurer of the above-named

heavy representation
grade utility stocks. Net investment income,

increase in the market value of the
or

firm

is

Association

Bar

American Bar

the

5,133,712.27

subdivisions

Bank

Woodfin!

13,458,271.01

—

and

States

of

Apolitical

TOTAL

of

before taxes, was some 20% higher in 1958 than in 1957.

$8,142,000,

law

Pipe¬

Government

States

obligations, direct
Obligations

Loans

Mr.

Law

joined

United

Gulf In¬

Transwestern

other

banks, including reserve
balance,
and cash items
in process of collection
$10,430,272.47

terests.

from

Texas

and

Co.,

stock holdings there is

in some of the better

was

Houston

of

1940

To all

policy, with about 55% of its assets committed to bonds.
common

in

Co.,

Gas

counsel

was

line Co. and other oil and gas in¬

Stock Ex¬

graduated

University

13.8

Investments

Market Adjustment

large

terstate

the

Woodfin

4.4

Government Employees adheres to

in its

of the New York

30.8%

All Other Assets

(

bers

Woodfin

with

balances

Cash,

deaths?

Other

Other

in

specialist in the
and natural gas

aggrandizement and glorification and finally die ignominious

Distribution of Assets, Dec. 31, 1957:

Common

general partnership

banking firm of
Carl M. Loeb, Rhoades & Co., 42
Wall St., New York City. Mem¬

set

581,000

—

Act.

Federal Reserve

the

,

12,469,000

All Others

Preferred

to

investment

that

partner in the

gas

Trunkline

for

in

Searls
a

How much longer must mankind defer to the vanities,
greed and hatreds of such enemies of the human race who

6,685,000

Physical

Cash

mitted

the

fields, Mr.

Woodfin has been ad¬

M.

A

1950.

corporate, oil,

greater concern to humanity than the
Khrushchev, a Stalin, a Hitler; a Mussolini,
helm, or a Genghis Khan and others?

$170,000

Bodily Injury

Auto Property Damage.

Auto

firm in

Gene

&

of

premium break-down follows:

Auto

Weems

He became

year.

Carl M. Loeb, Rhoades

$5,338,280
14,295,188 $19,033,407

coverage

Miscellaneous Bodily

kins,

Woodfin Partner in

523,390

by mail, of course, gives
the company a very low expense ratio, relative to the industry;
in 1958 its loss ratio was 68.3%, versus 76.5% in 1957, while its
expense ratio was 14.0%, against 15.5% the preceding year.
In
1958 the underwriting profit margin was 19.7%, an exceptionally
high figure, particularly for a casualty unit.
Net

New

of the

member

a

ASSETS

1,378,451

-—

Government Employees; has shown
an impressive rate of
growth in its premium volume, from $5,900,000 in 1948 to $46,-

600,000 in 1958.

/

Americas.

the

of

AVenue

Federal
Reserve System, at the close of business
on March 12,1959, published in accordance
with a call made by the Federal Reserve
bank of this district pursuant to the pro¬
York

3,243,834

~F"77~
;
i

$09,002,009

OF

CONDITION

312,222

Dividends..

___

2

DISTRICT NO.

RESERVE
'

25,371,589

—

Payable

.

-

$18,599,710

;

...

Expenses

14,087

...'

.

Loss

Policyholders
Taxes

12,980,300

-

Premiums Due

&

Exchanges.

divi¬

Is the long-term performance of this company not something
for all companies to shoot at?
Carefully selected risks constitute

the

Unearned Premiums

205,810

~

Stocks

Losses

added

been

of

I REPORT OF

School

Reserves:

$0,802,107
10,41.9,809
18,448,191

Banks <V on Hand

Cash in

Calif'.—Henry
to the

ANGELES,

Keil

F.

The gains in these data have been impressive. Not the least
accomplishment was the underwriting showing for 1958, for that
year continued quite unsatisfactory in underwriting results for
the industry, while Government Employees showed a highly sat¬
isfactory result.

lvir.

LIABILITIES

assets

West

242

(Special to The Financial Chronicle)

LOS

100% in 1954 ; 8% in 1955; 7%% in 1956; 4%%

an

Higgins.

Mitchum, Jones Adds

41%

These data have been adjusted for the numerous stock

&

Wilson,

with

now

Johnson

1.950__-

$0.11

is

Low

1949___

change.

•

U.

Net

The

number of states.

to

Taxes

Cal.—William H. Hut¬

CHICO,
chinson

Price Range

Federal

3958.

poration, Government Employees Life Insurance Company, and a
brand new one, Government Employees Variable Annuity Life
Insurance Company. The last, organized for the purpose of enter¬

'

Invest.
Income

CHARLES

F.

BAILEY

Correct—Attest:

The total

Hugo A. Brillembourg

company's portfolio in 1958

•

Charles D.

William

about 22%, an excellent showing in view of

C.

]

Deyo
| Directors
MacMillen, Jr. J

REPORT OF AN AFFILIATE, A HOLDING
COMPANY
AFFILIATE,
OF
A
BANK

NSTA

NATIONAL AND GRINDLAYS
BANK LIMITED

COMMON

13 St. James's Sq.; Govt.
Dept.: 54 Parliament
St.; Travel Dept.: 13 St. James's Sq.; In¬

PREFERRED

The

Security Traders Association of Los Angeles will hold
their annual summer party May
15, 16 and 17, at the Biltmore,
Palm Springs.

13

Bankers

to

Ins.

Depts.:

54

Parliament

St.

Bulletin

on

Request

the Government in : aden, unta,

Laird, Bissell & Meeds
Members New York Stock Exchange

MAMDA, ZANZIBAR '* SOMAULAKO FKOTXCFORATi

Members American Stock Exchange

Branches ins

130 BROADWAY, NEW YORK 5, N. Y.

•VIA, PAKISTAN, CEYLON, BURMA, K1NYA,
TANGANYIKA, ZANZIBAR, UGANDA,

Telephone: BArclay 7-3500

NORTHERN AMD SOUTHERN RHODBHA.




MEMBER

OF

THE

SYSTEM, PUB-

ACCORDANCE

WITH

PROVISIONS OF THE
RESERVE ACT

Bell Teletype—NY

1-1248-49

Specialists in Bank Stocks

San

Francisco

Albert Hewitt, First California Company, San Francisco, is in
charge of reservations.

Boston

Securities

Traders

Association

at the Salem Country Club

of

control:

Ownership of 94.67%

of

member

bank.

Financial

relations

with

affiliated bank owned

value)

bank:

hold

their

June 11.

of

stock

Stock

of

by the affiliate (par

$1,419,975.

I, Hugo A. Brillembourg, Executive Presi¬
Valores Comerciales e
Industriales,

dent of
C.

edge and

will
on

enterprises.

A., do solemnly swear that
statement is true, to the best of

BOSTON SECURITIES TRADERS ASSOCIATION

annual summer outing

such

degree

Security

Traders Association will hold
their annual party at the Santa Rosa Flamingo Motel, Santa Rosa,
Calif., June 5, 6 and 7.

The

Lending
to commercial and industrial enter¬
prises and investing in shares and securities
money

Manner in which above-named organization
is affiliated with member bank, and

SAN FRANCISCO SECURITY TRADERS ASSOCIATION
The

&

St. James's Sq.

ADEN, SOMAIILAND PROTECTORATE

A

Trust Company, New York, N. Y.
Kind of business of this affiliate:

of

Depts.:

Tax

IN

1959, of Valores
Comerciales e Industriales, C. A., Caracas,
Venezuela, which is affiliated with Colonial

SECURITY TRADERS ASSOCIATION OF LOS ANGELES

Securities Co.

London Branches:

54 PARLIAMENT STREET, S.W.I
13 ST. JAMES'S SQUARE, S.W.I

come

LISHED

Report as of March 12,

Christiana

Head Office:

Nairobi;

IS

FEDERAL RESERVE

FEDERAL

24 BISHOPSGATE, LONDON, E.CJ

Rd.,

WHICH
'

THE

Amalgamating National Bank of India Ltd.
and Grindlays Bank Ltd.

Trustee

Notes

the

above

my knowl¬

belief.
HUGO

A.

BRILLEMBOURG.

Volume

189

Number 5834

.

.

The Commercial

.

and

Financial Chronicle

(1533)

1955, margins have dropped from haul

Chemical

16% of sales, before taxes, to

Industry's Outlook

promising to chemical industry

according to Mr. Queeny acting

as

Predicated

increased

5%

above

profit margins, with

spokesman for the industry.

Taking his firm's 1929 sales, product
by product, he finds today's prices are but .3% higher—in the

For

1959,

know

based
about

now

what

on

the

first

national

we

quar-.

certain bellwether chemicals
following an upward trend:,

ter,
are

fertilizers,

up

,•

raw

product in the range of

Based

the

for

months,
industry seem

bound to reach $24.4

2%; industrial
chemicals,
plastics,

increase

have

the first three

on

sales

1959

we

5%

of

billion,

over

the

or an

compa¬

miscellaneous

rable 1958 figures of $23.2 billion.One informed estimate predicts an

organic

overall 6V2%

chemicals,
synthetic rub¬
ber, all up 10
to
11%; syn¬
thetic
fibers,
up 17%.

companies should ring up greater

These

units, not dol¬
lars. However,
since prices

E.

M.

Queeny

remain

will

static,

dollar-wise

1959

should

witness increases industry-wide of
somewhere

between

after the weak spots

their

downward

6

and

10%

have applied

pressure

against

the

strong, upward trend.
Now, for a few highlights of the

second

half, thence to specifics.
reasonably stable.
squeeze will con¬
tinue, but due to better volume
and
new
technologies
industry
earnings should increase.
Capital expenditures will be off
somewhat—as compared to 1958.
cost-price

An
tion
for

furnished

estimate

industry

source

me

by an

notes this reduc¬

8%. Even so, expenditures

as

increase. Individual

(3 )r Continued introduction
chemical products.

of

we

would hardly suspect that

year

was

marginally

off

last

in the industry do not

large expansion of
the wage rolls for 1959. Last year

However, there are indications
that capital investment may have
passed a high-water mark and
will
show, if not a decline, a
plateau
situation,
perhaps
into
1960. Since the chemical industry's
growth is in cycles, rather than in
a

straight line, I choose to inter¬

pret the omens as the end of one
of activity and
another, better one.

era

If

one

any

average

the

is looking for

start

of

\

significant

I

Monsanto's

believe

includes

hour.

I

fringe benefits as
insurance, and
in excess of $3 per

group
was

believe

Monsanto

representative of

We

This

industry are quite
that a few products are in
over-capacity for the time being.
aware

It will

take

a

be

to

the industry.

a

been

tivity
been

Monsanto's

—

Titolo Adv.

Mgr.
For Harris, Upham

nearly

Harris,

Upham

Co.,

&

has

bers of the
New

in plant produc¬

change,

E

x-

have

announced

that Theodore
Titolo

S.

,

'

York

Stock

and, from what I hear of highly
instrumented,
semi - automated
plants, we're going to keep right;
on increasing productivity.
Mon-';
santo announced it will putthe
first
fully
computer - operatedchemical plant on stream in the
fall; our competitors aren't far

has

been

'•

appoint¬
ed Manager of
the company's
ad vertising
department.
Mr.
Titolo,
a
registered

7."l'

securities

r

Prices'?'--'.1 f•<

120

Broadway, New York City, mem¬

the chemical industry has
outgaining other industries

behind.

own

index for the period was
102 in December, 1958; today, it
may have fallen below 100.

Our

employment

wage

110.0.

about 30%.

The fact is

1947-

price

In the last
of salaried

increased

at

I spoke

quarters.

If

forecasts

I have

no

are

continued improve¬
ment. In some cases there will be
see

similar, industry-wide

comparison; Department of Com-

under the firm name of Jack
R. Payne & Co.

more

any

NEW

is neither an offer to sell nor a solicitation of an offer to buy
of these Shares. The offer is mack only by the Prospectus.

ISSUE

spartan at¬

However,
to

have

a

the following appear
bright future for the

second half, sulfur,

oxygen,'due to

steel production,

increased

54,000 Shares

Public Service

Company of New Mexico

unless

rubber

consumption;

ceuticals and specialty

Cumulative Preferred Stock, 1959 Series 5.25%
(#100 Par Value)
with Common Stock Warrants

Each share of the 1959 Series Preferred Stock has

pharma¬
chemicals;

because of increased use on crops
as

a

attached

a

detachable

warrant

entitling the holder thereof to purchase three shares of Common Stock of the
Company at $31.25 per share during the period commencing on October 1, 1959
and ending on June 30,1961, and at $33.75 per share thereafter until 2 p.m., E.S.T.;

plastics
materials,
notably the
poly olefins;
ammonium
nitrate,
1

on

July 1, 1963.

*

~

construction explosive.

well because of bright sales out¬

Many companies, including
Monsanto,
had
all-time
record

Chemicals used to process syn¬
thetic fibers and paper

should do

Price

looks in both industries.

Synthetic
fiber sales may end the year 15%
or
more
above the comparable
1958

figure.

$103

per

Share

plus accrued dividends from March 15, 1959

.j

/
Profits

highs.

We had

santo's

pre-Korea period

.

constitutes 42%

number

has

naval

equaling 100, the Department's
December, 1958, price index for
chemicals
and
allied
products

70% while the expansion ift Mon¬

titude toward costs to make these

1957.

record

the

years

•

However,

chemicals.

to

the

strenuous sales ef¬

and

realized, I

with

announcement

the

in

During
1958
the
industry's
profits after taxes averaged 6.9%
of sales, compared to
7.6% for

fourth

10

employees

of

earnings

hourly

such

now

of the total- employees.

employ¬

experience over a five-year

Monsanto employees were better
than 25% above the average of

pensions,
vacations,

salaried staff

portents, I would point to the
projected
$157.2
million which

there is a sfeel strike; chlorine,
plastics, and pesticides; chemical
fuels'and oxidixers, thanks to the
emphasis on missilery in defense
those in all industry. Monsanto's planning; styrene and ethyl al¬
average hourly labor cost, which cohol, due to increased synthetic
the

a

(5) Increased highway construc¬

particular products break even.
was

research

stood

tion.

Employment in the chemical in¬
and

technical

to

paint,

host of products un-

(4) Increased automotive pro¬
duction, housing, public construc¬

year.

foresee

related

person-

and

a

tion.

fort, ingenuity and

year

technical

35%

assigned

stores and

salutary effect. The indus¬ note that, in line with a national
try generally can now boost out¬ trend, the proportion of Monsanto
put somewhat without much new personnel engaged in administrative, staff, clerical, marketing and
plant or additional employment.
research has been increasing more
Capital Spending

ment

new

plant and equipment dur¬
ing the year will exceed a billion
dollars for the ninth consecutive
new

dustry

increased

personnel

including

representa¬
earlier of the traditional <
increases.
1
tive, has been
the
chemical; industry'
has been set aside for new re¬ burden
Theodore S. Titolo
associated
Quick as the recovery was, and search laboratories as a sign of- bears in holding the price line. I'd
with
Harris,
good as the prospects are, we face faith in the future. I might add like to cite some examples from
Upham since
some sobering prospects — among
that
if
increased
spending
for our own records.
them inflation, new materials cost research and research facilities is
Monsanto's 1929 sales, product '^51' P«or to his affiliation
the firm's advertising department
increases,
higher
wages
and the mark of the optimist, then our by product, if priced according to
in 1955, he was research depart¬
fiercer domestic and foreign com¬
our
1959 price schedules, would
company is so marked.
ment analyst for the entertain¬
petition.
cost only .3% more than the prices
Parenthetically, while we're re¬
ment industry, and senior editor
But
the
following
favorable ferring to plant expenditures, I charged 30 years ago. This is an
of the firm's publications depart¬
factors are at work:
cannot agree that the industry as unloaded comparison; no conver¬
ment. Mr. Titolo is a member of
sions
have
been
made
from
1929
(1) A general improvement in a whole is overbuilt. Although the
the New York Society of Security
to 1959 dollars.
During this pe¬
the economy and expectation of industry had been as low as 60%
riod our hourly wage rates in¬ Analysts.
of
an
capacity in mid-1958, I believe
increase of 5% in the gross
it is now operating at something creased 460% a— and prices of all
national product.
Jack R. Payne Opens
our
principal raw materials in¬
like
85% of capacity. This does
(2) Increased government
creased;
for
example,
benzol,
GETTYSBURG, Pa. — Jack R,
spending
in
specialized
fields, not signify an overbuilt industry.
36%; naphthalene, 134%; sulfur, Payne is engaging in a securities
such as exotic fuels for missiles.
Employment
19%; coal increased 189%.
business from offices at 238 BaltiChemical sales will benefit.

Prices will be

The

nel

,

allied

category

with

fig¬

represent

ures

new

j.

materials.

$475 billion is realized,
a good year in prospect.

been increased 25%,

recession year if
you used as a comparison the 1958
capital spending
figure of $1.8
billion and the $1.3 billion spent
for new plant and equipment in
the so-called "good" year of 1957.

try is over-expanded.

and principal

equipment had
This

efficiency.

figures are for chemical
products,
the (latter

merce

a

You

validity in the charge that the indus¬

face of drastic advances in wages

reflec-

industry, and

coupled with the many
cost-saving programs increased 44%.
It may be of further interest to
which were set in force last year,

last

squeeze, due to productivity gains. Em¬
ployment and capital spending, will slacken-off, however, but
no

the

in

rapidly than operating force.

comparable 1958 data and
firms achieving record

some

highs despite cost-price
Monsanto's head finds

accurate

an

trends

49

had

the prospect of a $475 GNP, the industrialist
"good year" in terms of: overall increase in sales

averaging

revenue

of

short-term

on

a

and

raising
muscle,

Co., St. Louis, Mo.

The bottom half of 1959 looks

envisages

plant

QUEENY*

Chairman of the Board, Monsanto Chemical

be

may

tion

early in 1958. But during the same During the past half-decade, while
period, heavy outlays for new our company's total employment

For the Second Half of 1959
By EDGAR M.

12%.;

13

some

uneasy

months in

late '57 and early '58; the period
is still too recent to forget. Our

The
noted

1958 will never be
its good profits. In the

year

for

chemical firms were
corrective actions and new tech¬ reporting
net incomes
running
nologies have formed strong pat¬ consistently some 25% below the
terns, which will continue. But same period of 1957. Second quar¬
the
industry's primary growth ter earnings were about 16% be¬
stimulus will continue to be new low; third quarter 1958 earnings
products and new applications for were only 4%
less. But these
older ones. There

are

research workers

in the chemical

about

35,000

industry.
Sales
Now to specifics.

Everyone with whom I have
talked in the industry agrees that
if economists' forecasts of a
gross
""An address

by Mr. Queeny before the
National Industrial Conference
Board, Los
Angeles, Calif., April 2, 1959.




Copies of the Prospectus may be obtained from such of the undersigned only in such States where
undersigned may legally offer these securities in compliance with securities laws thereof.

the

first quarter,

emerged
from
the
fourth quarter with earnings ap¬
companies

Allen &

Bear, Stearns & Co.

Chemical
been

under

profit

Boettcher and

McDonnell 8C Co.

Company

Quinn & Co.

Incorporated

Creston H.

and

margins have
from rising

Salomon Bros. 8C Hutzler

E. F. Hutton & Company

...

proximately 5% above the same
quarter of 1957.
Some of the
leaders reported their best final
quarters, in terms of sales
earnings, in their histories.

Lehman Brothers

Company

Funk, Hobbs & Co.
•

•

April 1, 1959

pressure

operating costs and steady or de¬
clining prices. Since the end of
"

"7*'

f

'

14

The Commercial and Financial Chronicle

(1534)

debt securities,

of

The

Banks and Bank Stocks
By WILLIAM W. AMOS*

levels.

sug¬

used to judge bank stocks
two important intangibles; i.e., management and the nature
of the territory served. In reporting the expectation of rising
level of business in the coming years and increased acceptance
of merger-branching pattern in banking, Mr. Amos foresees
reflection of this in brighter bank growth prospect and stimu-

It

that in

does

recent

investor

in

in changing

appear,
years

the

attitudes

formers of

toward

>

have

particu¬
compre¬

halt

rapid
in
d eveloping.

just

For

it

position, attaining new peaks in
deposits and earning assets and
providing an ever increasing num¬
ber of services under conditions of

few years ago

that bonds
con¬

only

the

safe

Reviews
William

most

stocks

W.

Amos

In

were

classed
tions.

rather

as

Today

the,- losses
dabblers

risky

specula¬

investor

have turned full

attitudes

circle, and after

suffered

by
Government

in

many

stocks

gard

investments

safer

as

bonds.

Another

change

is

rapid post World War I ex¬
pansion for the banks. While the
nation's banks were engaged in
many

underwriters through security af¬
filiates. As the boom of the 1920s

taking place.
Not long ago

developed, the bank's profits grew
rapidly and the prices of their

bank President,

in

commenting upon the increased
popularity of bank stocks, said

It

that

stocks

often money be¬
fashionable. For most of us,

every

comes

so

is always in style. How¬
ever, it is true that under today's
conditions of high
prices; high
wages, high taxes, and large budg¬
money

et

deficits,

and credit
is needed than,ever before to ac¬
more money

commodate the expanded needs of

industry and
mated

that

country's
business;

it

commerce,

close

to

__

It

the

until

not

was

1950's

that

Life

on

decade

banks

of

used in settling
transactions
is
bank

14,000

became

they

commer¬

that

bank

highly inflated
during this period,

did

ensuing

as

deflation

Aeccfrd

from their

March

of

1951

of

1950

the

to

end

1958, business loans of New
York City banks and <of the 94
cities

reserve

the

rose

70%

over

and

from lVi% to 4%. With

break

rate

of

funds

return

which it has taken years to over¬
come.

decade

largely

one

of

of

the

1930s

deflated

was

earned

from

rose

less

of

these

stocks

doubled,

they

began

to

over

rather

than

book

of

loans
rates

and

the

declined

sell

to

of

at

banks

play
the

the

United

increasingly

an

"Based

in

on

Institute

a

States

important

talk

of

by Mr. Amos before
Investment Banking at

the Wharton School of Finance and

Com-

University of Pennsylvania, Phila¬
delphia, Pa.
merce,

remained
order

at

very

low levels.

With

maintain earnings, the
bought U. S. Government
securities (mostly short maturi¬
ties) in large amounts. The deficit
financing policies of the Govern¬
ment

created substantial supplies

a

k

to

1

;

as

over

and

beyond

which

borders

have-heretofore restricted them,
Among the New York City banks
there have been serveral iniporlant mergers within the last five
years, as a result of which the
number of institutions in that city
has declined by one-fourth. Now
the proposed combination of J. P.

The
York

recent

State

Bought

—

Sold

—

Quoted

the-New

for

failed

c. D. Pulis & Co.
Members New York
25

Broad

System NY 1-2012




Security Dealers

;

*

ers

believe

Tel,

HAnover 2-6284

\

•

outlook

the

of

to a

up

us

for

banks and bank stocks in the dec¬
ade

1960's which

the

of

ahead

immediately
banks

tend

tions

of

they

are

the

of

Since

us.

condi¬

the

mirror

to

lies

now

in which
their pros¬
directly on the

economy

functioning,

conditions
several

generally over the next
A high level of

years.

business activity will make for a

large

volume

high
predictions

within

uct

loans

of

and

interest ratds.

tively

the

five

next

six

or

there will be substantial in¬
creases in the money supply,
in¬
years,

cluding

deposits

bank

and

earn¬

ing assets, and earnings of banks
will show good gains. Needless to
say, this would involve the raising
of

a

considerable amount of new

capital through the sale of addi¬
tional
ever,

of

securities

banks.

How¬

under these conditions there

would be adequate

earning power

to

place greater
strains on
bank
management and personnel as
well as on bank capital. Greater
use of automation
to do the job
most
economically will
be re-^
quired. The trend toward compre¬
hensive
department-store typ d
banking of both the "wholesale"
and "retail" variety will continue]

Barings

1958——____
1957

1956—

it

as

Dividends

-

Declared

will

* 55.7

235.634

130,224

55,3

202,668

__

135,207

119,830
110,820
101,528
93,155
91,766
87,349

97.2%,

79.4%

.

182,960'
174,979
161,628

1953
1952

141,501
*;

eventually be

.

_____

Annual Rate of

•_

0.02%

-

59.3

58.0
57.6
64,9
64.6

-

>

*

*

.

14.0

16,6

8.7

4.6
*
-

December 29,
December 30,

1954—

December 31,
December 26,

1952„_i„____

1953—_i

1951—
1950——
1949—

Increase, Dec. 28, 1949 tq Feb. 25, 1959
SOURCE:

Federal Reserve Board.

r

•

because

about

come

states

other

setter

leader

a

as

tcf
or

regulatory patterns,

of

Furthermore, the element of com¬

petition

might

well

other

spur

states to remove some of their

re^

9.2

8.3

9.0

14.2

1.5

4.7

5.1

prestige by their local bank-?
institutions. The effect of
eliminating some of the restric¬
tions

~

expansion

now

states would
be to make possible a whole neyif
wave of mergers or other types.,
of

.

bank

on

in

several

which

combinations

would

brighten bank growth prospects
and might stimulate
interest iii
bank

stocks

for

some

time

*

come.

;to

:

„

59.4%

9.0%

'
____'

by

existing

8.1
*

__

For 94 Cities

25, 1959___,_
December 31, 1958—^

would

New York State is often looked

ing

5,6%

J3.2
10.4

*

•' *

February

This

and

Dividends

7.7%

(in millions)

'

,

'•••

—i—Increase

60.6

_____

:

against bank growth or
be-responsible for loss of position

.

^

58.8%

,

Leader

a

straints

% of

$156,689
148,406

1954—

State as

proposed changes in the

banking laws of New York State
are eventually enacted, it
is rea¬
branching
sonable
to
suppose
that other
York City
states will follow with liberalizing
legislation along the same lines;

NetOper.* NetGper.
EarningsEarnings

$266,687
266,645

___

1955

.
„_

York

New

If the

.

approved

•'

•

Operating

;

,

December 27,
December 28,

St., N. Y. 4

consideration

to

t\on session in 1960, maiiy observ-

$29,678
30,797-

For New York

City Banks

22,486
23,380
23,390
21,592
17,839
13,904

$10,505
10,991
11,699
11,471
9,173
7,568
8,530
8,735
7,933
6,305
4,851

113.4%.

116.6%

31, 1957—
31,801
December 26, 1956—___________30,848
December 28, 1955—
26,673

Request

growth.

These comments lead

New

the

of

under

*

December

on

future

,

possible

—

Memo

Westchester, and Rock¬
Counties,
they
will have
greatly expanded potentialities for
Suffolk,

land

revisions in that state's
laws which would have

appr0ve

made

session

legislature

the1 next

y
increase

Net

•'

•

Increase, 1950-58

Applicators,|[lnc

to

Morgan and Guaranty Trust is

Business Loans of Weekly-Reporting Member Banks

Plastic

Bell

new

for

New York City Banks
y ...... },■
Dividends

'

Average—

TeJe.

the

accommodate

banking needs of

in some form. If such
banking legislation is eventually
the 1950's, bank stocks haye come enacted in New York there will
in for substantially more atten- undoubtedly be* many more" com-

1950

Banks, Brokers and Dealers—

_.

population centers, as
other reasons, the

well

power

shocks

tremendous

1951

For

from

'

iXMj,.40

the

In

to

and

premiums banking

in institutional interest in common
stocks which has developed during

and

banks

that

so

;

•

cial

order

to

prices

discounts

business

level

6%

values.
MOrC

conditions, during which the vol¬
interest

on

than

■

ume

sion

increased impetus to the
ex- giving
pected to reduce the number of merger and branching movement
among banks.
capital institutions by one more,

around 9% and that market

left

unpleasant
impressions
in
the
minds of
bank
stock
investors

If the New

City banks receive permis¬
have branches in Nassau,

York

under these conditions the average

especially

was

market

holding company arrangement

and some may merge.

support theadditional shares
"5:'f
banks also have entered upon a placed on the market.
A dynamic economy also
phase 7of branch banking
and
ma^
growth through mergers, which be expected to prove conducive to
promises to continue for many a broadening of the merger and
movement
of
recent
years. New legislation, such as the branching
Bank Holding Company Act of years. This would come about as
1956, and proposed new bariking the banks seek to serve ade-?
the
enlarged
banking
laws in various states, appear to quately
be enlarging the growth potential needs of both their city and sub¬
urban
customers.
Enlarged
de¬
of banks by permitting them to
expand and follow their customers mands for banking services will

prime lending rate increased

^

The

severe.

The

the

unfortunate

was

as

to astronomical levels.

rose

In

suburban

of

bank

and

_

credit

„

Bankings New Lease

because when the bubble burst the

is esti¬

90%

money

check money. The

stocks

institutions.
together under

banking
band

rela¬
If the
of many economists
are realized insofar as they envi¬
sion a 200 million population and
a $600 billion gross national prod¬

13

end

of

the

of

may

In 1950 only 17 stocks, of pects will hinge

the

of

was one

a*id current developments suggest
that a revision of this attitude is

a

which

for at least 10 consecutive

years.

higher inconstructive activities dur¬
terest rates and more loans, earnfound in investor attitudes toward
ing this decade,
they unfortu¬
the various
ings
and
dividends
began
a steady
stock
groups.
His¬ nately became involved, in,many
torically bank stocks have tended instances, in the credit excesses clirab. For 12 major New York
City banks, aggregate net operatto
be
regarded
as
primarily attendant to the inflation in the
ing earning rose 97.2% from 1.950
defensive income securities, com¬ stock
market, and in real estate
parable to preferred stocks, with developments. The banks became to 1958, and dividend declarations
increased 79.4%
in
this
s,a m e
little appreciation appeal.
How¬ identified with the security mar¬
ever, the record of the past decade ket via loans to brokers and as period. It is not remarkable that
than

stocks

Some

years, from. 1934 to City .banks)
and is growing
bank's prime lending rapidly. At last reports, most of
rate remained unchanged at lVi%, the Massachusetts savings banks
it is remarkable that the commer- which
had bought substantial
cial banks of the country were amounts of bank stocks since they
able, to do as well as they did in became eligible were highly satismaintaining earnings during that tied investors,
period. It is no wonder that durWith the rapid population
ing most
of those years. bank growth and economic expansion of
stocks sold at discounts frqm book the nation during the '50's, banks
values and ' came to be regarded in all parts of the country have
as chiefly income
securities with found themselves faced with many
negligible growth or appreciation new problems. r *
prospects, .to be brought «olely:on
■
a yield basis*
.
; Merger-Branching Movement

for

1947,

better per¬ made
it possible for money, rates
today's to rise or fall with demand and
stocks,
supply factors. At the same time
briefly
loan volume began to increase.
of the
From the

The decade of the 1920s

bank

binations

outlook for business and economic

Treasury

a

out-of-state

rates

V hibernation. The Federal Reserve-

Decades

spective with respect to
position of banks and bank
it may be well to review
their position during each
past several decades.

Bonds

last summer, it is possible to find
a number of individuals who re-

gain

amendment to that state's

an

banking laws which permitted
Massachusetts savingi banks foi
Ahe first time to invest in certain

S. Gov-; paid

Interest

stocks began to emerge

Trying

to

order

funds,

Thursday, April 2, 1959

.

.

at very low levels which 12 were New York City
throughout the war and postwar banks, qualified. Today the list of
years until just about the end of qualified stocks has expanded to
the decade. When it .is/ realized 44
(of which 11 are New York

the

rising interest rates.

investments,
while

during the

early part of: that year. Today,
26 years later, we find our
banks in an immeasurably stronger

example,
only a

sidered

they are well-

the

was

were

per¬

as

practically ground to a
bank holiday in

business

d

a n

and

1933, will recall' how the nation's

been

larly

hensive

As suppliers

credit

nigh indispensable to the effective
functioning of America's economy.
Those who can remember back to

security

trust

pegged

were

multitude of banking

trust services,

and

various

groups

a

an^l'U.

securities.

ernment

that

short-term

of

however,
changes

War

a

their assets in cash

lated interest in bank stocks.

times.

funds,

ing an even greater factor in .the; met specified
tests. The three
banking business than it had been basic qualifications are that capiduring the depression years. It tal funds shall equal, at least $40
was
not uncommon in the 1940's million and at least 6% of deposits
to find banks with 75% to 80% of" and that dividends shall have been

gests adding to the usual criteria

our economy.

brought World

great step-up in the rate
of business activity, but with government deficit financing becom-

March, 1951, and why they should continue to give a good
of themselves in the securities markets, receive Mr.

role in

1940's

The

.

account

In addition, the banker

acted

II with

Resurgency of banking, having gained a new lease on life after

We live, as always,

Pension

created, did sustain bank earning] market for bank stocks. In 1950
power just above starvation diet the Massachusetts legislature en-

Vice-President, The First Boston Corporation
New York City

Amos' knowledgeable attention.

lion.

pur-

by
the
banks increased savings banks, investment trusts
deposits. Even though the rates of as well as insurance companies,
interest were very low, the huge universities, and specialized funds
volume
of
earning assets thus of many types.have come into the

Brighter Pattern for

Assistant

their

and

chase

.

In

field

the

of

bank

holding

companies

there are already a
major groups, whictt
have won investor recognition by
their excellent performances dur-f
ing the past 10 years or more;
Among these are Marine Midland)
Corporation, Northwest Bank Cor¬
poration, First Bank Stock Cor?
poration, and Wisconsin Bank^
shares. A new giant entry is bein^
attempted in the form of First-?
america
Corporation
with
itk
string of 23 banks in 11 westerii
number

of

states. The addition of the billion

dollar

California

Bank

of

Los

Angeles to this group will increase
the total deposits of the system.td
$4 billion and expand the number

Number 5834

189

Volume

.

.

.

The Commercial and

Financial Chronicle

of branches from 336 to 402.

advantages of branch banking in

merger

other

[The
is currently being con¬
tested by the Anti-Trust Division
of the Department of Justice. Ed.]

We

•.

intend

Judging Bank

Stocks

gains

'

Before

concluding I would like

to say a few words about what to

lookr for
stocks.

in the analysis of bank
Statistically,- we
derive

by

to

look

ment

and

cial statements of banks, and then

tend

to

relate! these

prices to measure relative invest¬

higher price-earnings- ratio and
premium over book value for its

ment attractiveness. Thus, we take

stock than the

net

to

market

operating earnings per share,
per share, book* value

growth

stitution.

and market price to find the price

has

i

earnings

ratio,

the

yield,

the

capital adequacy

risk asset ratio by relating capital
funds to risk assets

(all assets less

cash and U. S. Governments). •
V: Of all the foregoing ratios, the

price

earnings ratio is generally
considered
most
significant
in
evaluating
tWo

bank stock. However,

a

important intangibles should

much, and in most

carry as

idea!

would-

stock

bank

be

ratios

available.

The

all-important intangibles

management

are man¬

for

substitute

such

Where

able

management.

has a
good growth area in which to
operate, the results for the bgnk
shareholder are generally reward¬
ing. Superior management usually
leaves

its

in

form

the

of

materially
better
than
average
earnings and appreciation records
for the well managed institutions.

trying

have^been through

many

periods

during
the; last
three decades. They have emerged,
however,
stronger
and
better
situated
new

than

ever-'to

the years ahead it is believed
bank stocks will continue to

good

a

that;
give

account of themselves

in

the securities markets.

Charles Brophy Named

In other words
of bank is always one
step ahead of its competitors. -,-;V
this

^

type

The

sections,

country

thb

of

which
are v. enjoying
the
best
growth rates tend to produce the
superior rates of expansion - in

deposit totals. Since deposit
is,the principal

source

money

of earning

it can be
seen
that a
healthy rise in deposits is the best
guaranty of good earnings gains.
It.may be noted that in the West
Coast areas there are greater op¬

assets,;

portunities
reason

laws

for

growth

bank

by

of the state wide branching

in

California,

Washington.

panies have obtained

and

Oregon,

Bank; holding
many

com¬

of the

i m

By Business Week

m e

only

as

a

visor

pointed
of

Assistant

Business

Finance

non

-

re vokable

Trust

.

.

Street, New York City,
an announcement by
Kramer, Managing Edi-

according to
Kenneth

not

y

For

the

have

•

.

Warrants?

a

A "Warrant" looks like a regu¬
stock
certificate; but it
is

Mr.

read
says

years

New

York

Herald

Tribune

are

number of

shares

of

a

Financial

&

ics,

the

capital

Chronicle.

articles

money

on

and >the

market

market for

other

various

publications.

-has

He

econom¬

.

,

,:

.

stock at

a

Now With E. F. Hutton
(Special to The Financial Chronicle)

.LOS
del

ANGELES,

F.

Hutton

Spring

>

&

.

now

Company,

Street.

formerly with Bache

&

He
Co.

with
623
was

matter

of record.

is

market

stock

at

its

-

surely
or

ing. 5% of its funds in Tri-Continental Warrants, buying them at
the right time. (1) The assets of

William J. Gratza

Tri-Continental J Corporation
of high-grade well-diver¬
sified listed stocks of large suc¬

the

consist

Westheimer

it

dividends.,
never

is

in¬

for

partment of Hornblower & Weeks.

Robert H. Moore With

exceptionally free from di¬
(4) The lever¬

large sums with very little

income.

no

an

ment

committee should trustee a

dollar

or

less

per

share—but they had

no

ex¬

one

—

Street.

Salle

La

formerly

a

Mr.

Moore

offer to sell

nor a

solicita¬

offer to buy these securities. The offer is made

only by the prospectus.

*

piration dates.
New Issue:

-

Stocks

Cheap

Versus

*

Only bankruptcy and reorgani¬
these stocks out

completely. Furthermore, in most
cases, stockholders had an oppor¬
tunity to put up a- little more
money
and those
stockholders
who did were given new shares,

50,000

some

of which have since become

very

valuable.

Shares

McQUAY, INC.
STOCK

COMMON

($1 Par Value)

Northern Pacific
stock is one of

*

Railway common
these.

Sign & Si
Common Stoek

It has sold

as

high

as

$1,000

per share and as low as 1% (ad¬
justed basis). It now sells at about
51 and, in my humble opinion, is*
one
of the best inflation hedges
on the New York Stock Exchange.
*

It is my

belief that

a

great ma¬

jority of the Warrants which have
been issued in recent years are'
of little real value today.
On the

SANO &

CO.

hand,

ago have become very val¬
Brokers
who
are
now

some

Warrants

recommending

St., New York 5, N. Y,

BOwling Green 9-7940

Richfield
grew

BRANCH

OFFICE:

RIDGEWOOD, N. Y.

use-

following few lucky ones as

amples:-

years.

April 2, 1959,

;This




1946.

RKO

such states in which stock may be
and from such of the
to sell

Warrants

in

lawfully sold,

as are

licensed

securities in such state.
9

Loewi & Co.
Incorporated

in

1942

undersigned

J. M. Dain & Co., Inc.

Paine, Webber, Jackson & Curtis

to $44,000 in less than four
was

due to an unex¬

$83,000
invested in
1942 grew to

Warrants in 1944 grew to
in

of the prospectus may be obtained only in

the

pected discovery of oil. (2) $1,000
invested' in United
Corporation
t

®

A copy

ex¬

invested

(1)- $1,000
Oil

$11.50 Per Share

of those issued

other
years

uable.

Prices

(3)

$1,000

Warrants

in

Woodard-Elwootf & Co.
April 2, 1959

with

South
was

Vice-President of A1-,

lan Blair & Company.

This advertisement is neither an

*

H.

Robert

Moore has become associated

of $10,000 or more—

tion of an

111.

Barcus, Kindred & Co., 231

non-revokably to be used to buy

during a depression sell at very
low figures. General Electric has'
sold at 2%
(adjusted); General
Motors
at
H4; and some good
stocks now selling at high prices
for

sum

(Special to The financial Chronicle)

CHICAGO,

accomplish same, an invest¬

certain

they become absolutely valueless
for
all
purposes.
Many stocks

sold

Barcus, Kindred Co.

risk.

To

-

Warrants
usually
expiration - date, when

Furthermore,'
have

formerly in the trading de¬

was

very

of these Warrants is tre¬
mendous, enabling an investment
committee with courage to make

Warrants

bought

provide

vthey

come;

134*

Company*

rect labor, troubles.

Thus

be

and

South La Salle Street. Mr. Gratza

corporations. (2) Its port¬
folio is excellently managed, with
cessful

zation could wipe

Standard

CHICAGO, 111. —William J.
Gratza has become associated with

able board of directors. (3)
Because of its type of operations,

the option price.

Warrants

300,000 Shares

Weslheimer & Co.
(Special to The Financial Chronicle)

; From the above you - can see: age
that Warrants carry no interest
should

Cal.—Luis M.,

Camino-Royales is

South

E.

'

Win. J. Gratza Joins

above.

which

the

church,

a

Option Warrant expires the price
of the stock will rise to a figure

or

pur¬

way.

would not want any
hospital, or individual
to put all its funds in Warrants
or in any one stock;
but even a
church would be justified in plac¬
I

Warrants•
a
certain,

option has no value except as*a
gamble that some day before the

above

a

stock
a

Buy Warrants?

During

written many

the

secu¬

Should Charitable Institutions

that time" he fixed price within a certain time.
was
Bond
Editor,. Investment If this price is less than the pres-:
Companies Editor and financial ent quoted value of the stock, it
is easy to figure
columnist.
the value, of
Mr. Brophy has also been Mu¬ the Option Warrant.
If however,
the
tual Fund Editor and Assistant to:
price of the stock is less than
that
of
the
Option
Warrant,
the
the Publisher of The Commercial
Syndicate.

in such

pose

or

bought for such

*

just what this piece of paper

before you-but-it.
an
option to buy

Warrants
be

* low.

lar

financial writer

five

past

Brophy has been

their

could

perpetual

Warrants,

for

much, more important for you to

tor.

over

nental

ad¬

Tri - Continental
will otherwise
tremendous profit potential

the

.

r

what Are

West 42nd

ex¬

"sleeping

all the

lost

when

330

a charitable institution or in-1
dividual to safely make a hand¬
some
profit.
Either Tri-Contln-

Corporation Warrants were can¬
celed arbitrarily by the SEC be¬
fore they matured—although they
were supposed to be "perpetual."
This scares me somewhat about

Babson

W.

Roger

Editor

magazine,

have

investment

no

watch

to

mentioned

'

Week

New Issue

15 William

This'

for

possible profits
I
also want
readers to know that the United

rities

At pres¬

in

with

-

those

that

so

estates"

companies
solely'for in¬
prices,

readers to

to

Warrants

above-noted

pired

be¬

ing bought
largely by
pension funds,
mutual funds,

ent

recommend

buy when the stock market takes
its
big
dip.
The other three

d i ate

are

shall

I

opinion, they are
Charles G. Brophy has been ap-- my
readers of this column;

of these shares having been sold, this advertisement
appears

trust,

is absolutely essential. The Chari¬
table Corporation should, in the '

brokers

profit.Stocks

once

All

from

any common
stocks f or

come.

and

ating techniques.

non-revokable

a

be invested at that time.

lately received by mail

and insurance

with the New York Herald Tribune

with

bank

have

In' ing purchased
today are be¬

challenges of the future.

superior
management to lead rather than
to follow in the adoption of wellthought-out innovations in oper¬
the

for

to

original
I

the; which

meet

It is also indicated by the tenden¬
cy

as

-

management

mark

:

everyone

investment

would then normally
buying Warrants at any
Hence, to make this plan
the money must now be:

price.

'

circulars

and

two

agement and the nature of the
territory served. There can be no

•

which

one

weight than all the statis¬

more,

tical

cases

good

Banks

compute the

we

;

sane

like

work,
placed in

they advance in price,- in the manner prescribed. The
author hopes that, unlike UnitedCorporation Warrants, "per:
petaal" warrants are not cancelled by the SEC.

r;. stack,

.

*

almost

committee
feel

and to sell Tri-Continental

warrants* as they decline in- price*

-

*

point of de¬

every

$208,000 by 1946. (4) $1,000 in¬ Agreement, also now order the
advising > vested in TH-Cdhtinehtal War¬ Trustee to begin to sell 20% when
oper¬
ates in a growing area- while still the purchase of Warrants at this ; rants in 1942 soared to $170,000 Tri-Continental stock is selling at
I am not now enthusiastic
not selling at so high a premium time.
by 1946.
These last Tri-Conti¬ $30 and then sell 20% more at;
nental Warrants are perpetual—
about
the
as
to
every one point of further ad¬
ovepdiscount its attractive
that
is, they don't expire. These vance. I believe this is a sure way
purchase of
features. V"
"
-'V
k
investment

percentage of dividend to- earn¬
ings and the ratio of book value to
market value. For a quick test of

will

somewhat

a

slower-growing in-

The

dividends

to

potential

command,

purchase of warrants. This formula is

designed for charitable institutions and involves the creation
of a non-revokable fund to he used to purchase Tri-Continental

/

on

This will be when business

is very poor and
is bearish.
No

defining warrants and their merits, Mr. Babson suggests

method to guide the

a

.

superior manage¬

certain basic data from the finan¬

figures

Alter

earnings ratios and low premiums
over
book
value. ' However,
the
bank which has

more

cline.

selling
at
yields, low-price

good

$10 per Warrant and then investing
20%

By ROGER" W. BABSON

of

reason

relatively

bank

for

Warrants, start¬
ing to invest 20% of the Fund at

Waixants Warranted?

are

statistically bar¬

are

15

Tri-Continental

Wfctii

rapidly growing sections of

the country.
stocks which

(1535)

Bell & Farrell, Inc.

•-<

16

The Commercial and Financial Chronicle

(1536)

from last

THE MARKET... AND YOU
some

restrained and its yield

sue

around 5% at reCent levels.
£ linkin„ Bore-

^

bseiy.

About

was

the

of the

only new

lows

new

highs

new

w5ith t&
that is

a

tune this year,

ea

ran a

or

helped

easiness in son)e
situations like H. L

g

business

Green

mQre

where weekend reveiahon of

than

of sales<

third

a

^e market would seem to be

a $3 mdlion discrepancy in its
overlooking its work in nubooks upset the issue and it
c]ear ancj missile parts and in

air
new

lows.

Otherwise

some

conditioning and refrigera-

tion.

random

preferreds also
sagged to new lows to bolster
the total in this category.

man

was

of

one

the

better-

the auto firms, acting at times on receipt of
Borg-Warner's two new and large defense
produced only a bit orders but the issue still lolled

year for
section of

good

a

special

by

Even in 1957 which was

pne

1

e■

1.6 mdbpn and more

than double the second largest
corporate shareholder bpdy.

*

*

*

American Machine & Foun-

than

a dozen points un¬
_
TCV_
peak price
several
years back.
Last year the
company showed per share resuits that were hardly encouraging but buried in the
figures were high development costs that about cut

more

der

its

dry was enjoying a good fol- earnings in half according to
lowing until the recession cut some estimates. Such costs are

Rallies Fail

other business and over-

expected to be substantially

shadowed the huge strides be-

ing made with its bowling
alley pinspotter. As against
other pinspotters that are
the middle? of the sessions, sold, AMF's are rented and
selling all too often snuffed such rental was up a third
out much of the gains by the last year to hold the overall

Smaller this year and reported
earnings are virtually assured
of being double or more. The
drawback to Grumman and
some of the other aircrafts so
largely dependent on defense
orders is that such orders are

close

subject to sudden shifts,

While the market

luctant

to

was
,

-

its

re-

rally attempts were equally -futile
and when good action was
somewhat general early or in

to

retreat,

noticeable decline in

rather

a

degree which hinted that the
traders were hewing to a cautious line until

more

more

*

decisive

action is demonstrated.

*

.

'

'

to

revenues

a

much

modest 12%.
.

Mystery Issue

*
,T

,

One

.

issue that is

a

Whde American Machme is largely unknown

factor is Na¬
particularly m a high- tional Theatres which has
yet
yield bracket any more—the to show
any ability to develop
The proposal to hike the return falling below the 3 %
non-theatre earning power
dividend and split Interna- line at recent prices—it is still
but has been moving in that
tional Business Machines on a a candidate for a good gain in
diWtTnn""pvphaVw
3-for-2 basis, however, was earnings this year as rental
()f{er for NationaI Telefito
enough to project this issue, income continues to work Associates shares and warlately pursuing a mundane higher and the other lines rants This offer SQ far has
life, into the wide-moving recover,
brought in some three-fourths
class again with a one-day hop
; r :
/
.v*
of the common shares on
of two dozen points and land
In the depressed oils Socony tender
although the warrant
it solidly on the list of new
statistically has a bit more to holders have been more rehighs.
offer than some of the others luctant. The offer
expires the
that have enjoyed some spobeginning of next week by
Metals Scrambled
radic popularity. Its yield is which time the extent of NaThe well scrambled
group around 41/2%,
for instance, tional's eventual ownership of
not

*

*

*

^

^

•

•

-

was

the

metals

with

steels while that of Continental Oil
NTA will be

wavering uncertainly

the is below 21/2%. The shares are
market analysts tried
vainly of quality status with the
to figure out how much of
growth potential enhanced bv
as

more

*

*

clear,

*

,

record-breaking out- a new venture into the
pouring of : steel was due to chemical field with a
precautionary inventory million dollar Texas
buildups in case there is a that will start to operate early
-

strike, and how much
eral

business

recovery.

only thing clear

was

automakers weren't
tant

to gen-

The

impor¬
factor since their
buying

has been cautious

as

in

1961

the de-

bate still waged over whether

venture in

goals

or
*

not.
*

*

A

a

similar ioint

«

AustraC

what neglected generally alough the industry has been
able to show steady but undramatic

Stock
While

growth. Through the

Split Manufacturer
the

big play

so

t

far record sales and hold earnings
that within a penny of the 1957

year was in issues
or might be showing, a tribute to cost consplit, there were some market trol toN a great degree. Yet so

they will meet 1959 produc- are.
tion

plus

that the

an

T,

Except for an occasional
petro- tlareup m a single issue bemulti- ^a^e of rumors or what, the
plant P^Per shares have been_ some-

their

a^out to t>e

students who

saw a more con- far

this

year

Not the Whole

"the stock has

bit

Ch^7sler WTyFf1~

held

ia a ranf.e that ran °aly
a small fraction more than

three points.

st°ck splits subsided

[The views

this, unfortunately, is not the whole story. Not
there powerful influences at work in Washington
to add very
materially to the expenditures proposed by
the President, and not
only is there serious question as
to

whether the President will be
granted
he would like to

take

a

over

the manufacture of




The stock has recovered well

as

all the tax in¬
have, but unless the past is no

guide, legislation will be enacted which will lay heavy
burdens on future budgets and render
any progress toward
a
budgetary balance this year much Jess likely to endure
in the years that are to follow—and that almost
regardless
of the situation

by which the government is faced in 1961
thereafter. Actions already taken in past
years have more or less fixed very large expenditures in
these later years, again almost
regardless of what condi¬
tions are then found to be, and, for all
practical purposes,
regardless of what is done in Washington this year.
and several years

It

was the President's own
Budget Director who the
day remarked that "the public seems to think that
the President could send
up a budget for each year for any
amount from zero up. The truth is that a
very large pro¬
portion of the budget each year is determined by factors
built in during previous
years." Some of the items now
cited as imposing large burdens
upon the budget to be
submitted next January are the space
programs, modern¬
ization of aviation facilities, urban renewal and
public
housing, public works (flood control and other "pork
barrel" legislation now on the books),
special education
programs under the defense education law, enacted last
year, veterans pensions, so-called development loan fund
for aid to underdeveloped countries, the farm
program, in¬

other

terest

on

the national debt and

Most difficult of all

a

number of smaller items.

perhaps is the task of preventing

legislation which caters to some one or more elements in
the population without
adding proportionately to the ex¬
penditures in the budget then under study—but which
will add very
substantially to the outlays of future years.
us

not

get so engrossed in these details that
appreciation of the fact that a great
deal more than the President is
suggesting is needed to
get our fiscal situation in order. The President has on
we

do not have

more

than

one

a

clear

occasion talked

hearteningly—in general
living within our means, and of
steadfast refusal by government to undertake tasks that
the people themselves can do much better. At times,
par¬
ticularly in recent months, he has spoken in words that
terms—about the need of

the elder statesmen often used to remind

us

of

our

way

of life and to

guide us down the road of fiscal and finan¬
cial sanity. He,
unfortunately, has yet to translate these
noble sentences into concrete proposals.
About-Face Needed
Of course, a

really balanced budget, and a drastic re¬
duction in those outlays and commitments which evade
inclusion in the budget, would mean a complete aboutface in the general social philosophy of the day. It would
require that a very large part, in fact much the larger
part of the New Deal and the Fair Deal be scrapped. There
is a limit upon what could be done without such drastic
medicine. Greater efficiency, and some trimming here and
there would hardly scratch the surface of the reductions
in outlays that are really needed and which must be ef¬
fected if soundness is to be brought to our national
finances. We simply cannot afford to pay out billions of
dollars every year to keep millions on the farms where
they produce goods that can not be sold. We can not afford
what we are now doing in other areas either in the form
of actual cash outlays or in the form of guarantees and
"insurance." In point of fact, we may well prove to be
unable to continue indefinitely to do all these things and
remain solvent. That is the sad fact of the matter.

And let
in

our

us

make

no

mistake about it, a real balance

national financial affairs must be attained not
and

by
outlays
permit reductions in taxes. If we insist upon

more

which would

taxation, but by reductions in

unduly large expenditures then we must, of course, see to
it that taxes sufficient to cover them are levied and col¬

expressed

in

this

heavily on Pitts- rather sharply as the market article do not
necessarily at any
burgh Plate Glass. Similarly sold off, American Bank Note time
coincide with those of the
an earlier decision
by Ford to earnings fell 73 cents to $1.69. "ChronicleThey are
presented
mg

'

are

more

The auto supply
group was such as American Bank Note
also hesitant, the decision to which is
the principal maker
fabricate some of its
glass of stock certificates. Last year

in all particulars.

Story

But

But let

still

Thursday, April 2, 3959

It

if the President has his
way

even

creases

some

.

page

We See

family of holders totaling

muci1

^

As

first

.

Byrd is of the opinion that when the accounts are finally
rendered, a deficit of several billions of dollars v/ill emerge

only

has diversified well and
emphasis on reAircrafts were laggard and,
<eareh to broaden its product pricewise, desultory Gram-

noe

Continued from

stock-split plans already in
the works a rebound in earnings seems all but guaranteed,
The A.T.&T. split alone is
estimated as requiring a million or more new stock certificates with its extraordinary

pany

,

that the number of issues

reaching

(/ne

bit outmoded since the com.

-

business is

'

*

♦

*
Th

tention of retreatmg precipi-

tously.

was more active. Its
yield
approached 3
at recent
prices despite the sharp re¬
covery and with scores of new

of its automatic transmissions from Borg-Warner
when a long-term contract ran
out last year has kept this is-

irregularity continued
to plague the stock market
this week except for a few issues
where good news was
potent. Trading simmered
down however, and the various averages were able to
hold in relatively high territory without showing any inPrice

one

tion

STREETE

By WALLACE

year's low but is

of those issues still not up to
its 1946 peak when specula¬

.

those of the author

only.]

lected, but tax ^eductions, not tax increases, are what

we

really need and must have. That can be achieved only by
getting the government out of many areas which it should
never

have entered.

Number 5834

189

Volume

..The Commercial and Financial Chronicle

.

(1537)

17

/
starts this year will be about the even if wage rate increases are
same; as last y ear—1 ^ million or> restricted to amounts the economy

x-,

a

little more—but it will be some¬

what

By IRA T. ELLIS*
Economist, E. I. du Pont de Nemours & Company.

-

«•

,

.

'

*

•»

■

^

*. •

*

Pont economist offers

Du

future broken

down

*

an

into

K

fj'v,

«

.-

.

1958—the

'+

Wilmington, Delaware
•

■■

•

•>

«

as

.

,

-

economic preview

, 4 *

,i. ,

of the

near

principal categories and subcate-;

rise and voices

inflation

further moderate
misgivings about |our ^ability to restrain price

have

to

per¬

haps 5% of the
labor force

.

part i cu lar

tinuing Federal deficits will foster
continuing increases in commodity
prices. Long-term money loaned,
today may lose a significant part
of its purchasing power before it
.is.returned. Savers, therefore, are
reluctant to lend funds rather than
to
purchase equities, and when
they do lend they ask that the
interest rate provide some protec¬
tion against rising prices as well
as
providing payment for use of

factors,

new

work¬

young

seeking

ers

Ira

T. Ellis

their first job,
reduced

rising employ¬

ment costs, rising taxes, and con¬

time—because
of
seasonal

em¬

ployment in declining industries,
reduced employment in agricul¬
ture, workers with less skill than
the market demands, workers dis¬
placed by do-it-yourself activities,
workers displaced from one ac¬

the money.

tivity but unwilling to take other
available employment, and many
other
reasons.
The problem of

will be up

providing employment when and
where it is desired, matching the
skills required on a job with the
available skills,
paying desired

rates and fringe benefits, is
extremely difficult. Certainly, it
cannot be solved permanently by
so simple a measure as increasing
Federal spending.

wage

The

trend

of

by

a

rise in spending by the Fed¬

eral

Government.

deficit
reach

this

in

The

fiscal

Federal

year

may

$12^513 billion, with much
through the banking

with the output

last

system, i.e., by creating credit and
inflating the money supply. And
note that the deficit will result

automobiles

more

from

from

a

a

rise in spending than

decline in receipts.

Budg¬

expenditures in the current
fiscal year are $9 billion above

eted

1959.

year

over

(Retail
units

come,

and corporate profits will
high records in 1960,

all make new

to 5t,4 million in
sales of domestic

a

year,

The output of nondurables may

year ago,

mortgages and to finance the ris¬

ing rate of automobile

sales,'and

from businessmen. Note that pres-

turers

March

talk by
Organic

Mr. Ellis before the
Chemical
Manufac¬
Association.
New
York
City,
a

11,

1959.




to

some

Marks
and

&

Co.

as

In

%

CORRECTION
The
ance

table

showing Life Insur¬

Holdings

in

Chemical

the

Industry, found in Mr. Richard
G. Woodbridge Ill's article, "A

Long-Term Investor Looks at the
Chemical Industry," page 24 of
the March 5th issue of the Chron¬

We must

conclusion, if we manage our
in the next few years to

avoid

a

Form Investing

and I think

we

not suffer a

Co.

can—and if we do

shall not in these years
—the long-term business outlook
in this country is excellent.

I think we

Corporation

formed with offices at
ties business.

-

•

.

the

of Validated but Unexchanged

of the Following Issues:

German Government
Per Cent. Bonds, due

Per Cent. Bonds, duo

October IS,

International 5Vi% Loan 1930, Flvo and
June 1,1965 (the Young Loan).

The Free State of Prussia

(Freistaat Preussen) 6!/i% Sinking

External Loan of 1926, due

Ont-hdf

Fund Bonds,

September IS, 1951.

(4)

The Free State of Prussia (Freistaat Preussen) 6%
External Loan of 1927, due October 15, 1952.

(5)

Conversion Office for German
January 1, 1946.
■

:

r
'

i

*

more

general factors which will impor¬
tantly affect the level of business
activity, the number of housing

'

The Federal

Sinking Fund Bonds,

Foreign Debts, 3% Dollar Bonds, duo^
14 \

__________________

Republic of Germany, by an Offering-

I.

Circular dated October 6,

1953, made Exchange Offers to the holders of the outstanding German Dollar Bonds
of the issues listed above (and appurtenant coupons) to be validated pursuant to the

procedures for validation of German Dollar Bonds. The Exchange Offers were made
pursuant to the London Agreement on German External Debts, 1953, and its
Annex I, between the Federal Republic and the United States, United Kingdom,
France and other

interested Governments.

Announcement of these

Financial Chronicle"
at the

on

the "Commercial &
1953. The Exchange Offers expired

exchange offers was published in

the 15th day of October

December 31, 1958.
however, exchanges may be effected

close of business on

In individual cases,

"

_

notwithstanding the

expiration of the time limit providing that bondholders submit satisfactory evidence
of reasonable cause for delay. This will, for instance, apply to bonds validated subse¬
quent to the

expiration date of the Exchange Offer.

The relevant

applications will be submitted, as hitherto, to

the following Exchange

Agents:
J. P. MORGAN & CO. INCORPORATED,
23 Wall Street, New

for the Issues listed as (1),
X4) above.

DILLON, READ & CO.,
41 Wall Street, New

York B,ILY.

(2), (3) and

York 5, ILL

for the Issue listed as (5) above.

For and

on

behalf of
of Finance

the Federal Minister

March

31,1959.

*

has been
11 Rockledge Road to engage in a securi¬

vesting

third world war—as

(2)

>

HARTSDALE, N. Y. —Nation¬
wide Small Business Capital In¬

major business decline—

German External Loan 1924, Seven
1949 (the Dawes Loan).

(3)

York

security analyst

portfolio manager.

affairs

(1)

will be
January level.
of

New

icle, inadvertently left out a vital
provide employment in these years figure. The table should have in¬
a rapidly rising labor force in
cluded John Hancock Life Insur¬
order to provide the necessary in¬
ance Company's holding of 20,000
come to
purchase the goods and shares of Hercules Powder Com¬
services the economy will be ca¬
pany common stock.
pable of providing.

Nonce to Holdors

duction rate for the year

Turning
*From

Synthetic

automatic.

be

Inc.,

for

Dollar Bonds and Coupons

We estimate that the average pro¬

about 2% above the

few

because the rate of family

will not

Fund,

City. Mr. Bernenko was formerly
associated with Laurence M.

Federal Republic of Germany

may

rise 6%, with the output of tex¬
and budg¬ tiles and apparel up 8%, paper
eted receipts are down $1 billion. and
printing up 5%, and chemicals
Business spending for new plant and allied products up 7%.
The
and equipment has not risen much
principal increases in chemicals
yet because of the excess capacity and allied products are expected
built in the previous three years— in the industrial organics, up 12%.
excess
in relation to present de¬
Output of synthetic fibers may
mand but likely to be absorbed
rise 17%, synthetic rubber, +15%,
within a very few years.
Auto¬ and plastics materials, +12%.
mobile sales are running signifi¬
Paint products may rise 8%. More
cantly above the level of a year moderate growth rates are ex¬
ago, but they are not yet approach¬
pected in the output of vegetable
ing the level of 1956 or 1957, not and animal oils, soap and allied
to mention the record levels of
products, and fertilizers.
While
early 1955.
the expected rise in the produc¬
Interest rates are relatively high tion rate of chemicals and allied
because of the high demand for products in 1959 over 1958 is sub¬
borrowed funds from government, stantial, remember that much of
from
individuals
for residential the increase has already occurred.

the level of

have difficulty

high growth rate

—a

of primary metals

this

a

Madison

1958,

rise to 5.1 mil¬
compared
with 4.3 million in 1958.) The out¬
put of machinery may be up 10%.
lion

may

Herbert A. Bernenko

1961

1930's. But, when we recover from

expected increases in automo¬
bile' production and: on business
spending for new plant and equip¬
ment.
Wage rates, personal in¬

28%, and automobile produc¬
tion up 27%—from 4.24 million

units

We

in

a

on

up

of it financed

decline

business

activity

business

in 1959

Uie

by the low birth rate of the late

Looking; ahead to 1960, we ex¬

from the low level of 1958 has al¬

rise 11%

a

years

pect business activity to rise mod¬
erately further in that year-above
the 1959 level, based principally

throughout 1959. The
average for the year will repre¬
sent a new high record, and the
fourth quarter rate will be the
best of the year. Industrial pro¬
duction—the output of our facto¬
ries and mines in physical terms
—may be up 9%
in 1959 over
1958, but note that this average
level would represent a rise of
only 2% from January, 1959. A
substantial part of the recovery

may

overdo

re¬

formation is still being restrained

'

activity has been ris¬
ing since last April, supported ready occurred. Furthermore, in¬
dustrial production may be held
again by rising residential con¬
down by a steel strike in the third
struction, the end of inventory
liquidation and the resumption of quarter of this year.
The
output of durable goods
inventory building, and this time
Business

be held to

roads, schools, and puhlic welfare.
Here, also, we. s h quid restrict
spending or increase taxes to payas-we-go for the -services .we de¬
mand from government. /
,:

.

There is fear that

can

automatically or in¬
must do something

in the economy over the next

expenditures for fis¬

1960 should

That
must

we

probable business decline in the
budget in years of prosperity by early 1960's, we shall be in the
restricting expenditures to an period of the "golden 1960's" when
amount we are willing to pay for. the labor force and family forma¬
Spending by state and-.local gov¬ tion will be rising rapidly because
ernments <Will rise this year be¬ of the high postwar birth rate.
cause
of rising expenditures for Here again, however, prosperity

high demand for loanable funds.

re¬

year

$77 billion, spending for calendar
year 1959 would
exceed that of
1958 by about $4.5 billion. We can
and should balance the Federal

„

ported as un¬
employed at a

suffer

of spend¬

half

the

\

expansion of
build¬
ing, residential construction, and
credit expansion in 1960, we may
we

1962.

cal

rates are about; where
they were. in the 1920's.
:
But interest rates are rising for
a reason other than the relatively

continue

shall
.

If

sustaining

-

-

we

in

the first

we

not

been

of

vice-president

business capacity, inventory

Federal level

the

come

evitably;

or

.

interest

at

or

positive to secure the desired
'■* V
sult. • ?

of 1959.

for

Even if total

Although unemployment is more? eta rates*are high only in com¬
now
than it has, been, parison with the "easy-money?
rising, rate- ratesVof tlje 'past 25 years—theof business activity will rapidly rates ! which. fostered
the rising
absorb the ■
•prices and the rising
— commodity,
cost of presidential construction
normal la¬
over the past 13 years.
bor force, alCurrent
.we

will not

ing authorization-; already on the
books

since 1954, the current

though

rise

output.
when

year

elected

price
stability, which should be our
goal. Here, also, is an area where
the
accomplishments we desire

.

because of the high rate

serious

...

will

It

capacity
the

be

Herbert A. Bernenko has

have economic growth with

vi. Government;. s;pending?;seems
likely to rise at all levels in 1959.

warns

will

determine! whether

\

ually rising

head into full capacity during

.

practical

actrvitjrweire^

this crucial year.:
that if we overdoexpansion we may suffer a business decline in 1961 or 1962
which will be complicated by downward family formation trend
occurring at that time. He adds that once we recover from a
probable decline in the early I960'*, "we shall be in the period
of the 'golden 1960Y " providing * we -' sustain rising labor
force with employment during the interim years.
as we

of. recovery

with Their depline of
billion in 1958. We are
already, seeing the? beginning of
(his rise in the. purrent; increase
in steel orders, and- the moderate
but widespread' rise ■ in business
compared

having already occurred from

Pleading for positive action, Mr. Ellis

saihe. rate

enjoyed in. 1955 from 1954."

almost $6

For 1960, he3 anticipates

1958's low level.

we

Nonfarm business inventories may
rise $3 billion,-or 3.5%, this year,

gories. Noting that the new output high expected in 1959
will average but 2% above January* the writer explains this
is due to substantial recovery

Madison Fond he.

of cost control will
seasonally ad¬
justed level of the past six months.; be more difficult in 1960 than it is
Business spending for hew plant" in 1959, together with the prob¬
and equipment may rise to $32.5 lem of restraining price increases
billion, ; up 7% from: the total for as the economy again approaches

60s"

We Reachtke"

Bernenko V. P. of

afford without raising prices.

can

The problem

below' the

by DR. SEIDLER

'

",,

The Commercial and Financial Chronicle

18

.

Thursday, April 2, 1959

.

.

(1538)

do no better than break even. This

Exemplified
the Chemical Industry

Growth Stocks
In

as

By DR. ROBERT E.

at reasonable prices is

importance, and yet it is likely to
be the investor's most perplexing

problem. The problem of pricing
growth stocks is a very complex
subject in itself; in any case, it
cannot be explored in this paper.*

KENNEDY, JR.

Partner, Palmer-Kennetly Organization, Dallas, Texas
Member of the Faculty of the Business School

In answer¬
Kennedy uses the chemical/
illustrate evidence submitted to buttress his con¬
regarding the proximate
growth stocks. The

The writer goes into detail

ultimate

and

causal

of

determinants

former, financial characteristics, are held to be capable of
quantification and the latter, fundamental characteristics, are
deemed not amenable to exact quantification but sufficiently

general in

scope

and regular in

For

more

than

decade

a

A third grouping of

now,

of

growth stocks for

and

and

security ana¬
lysts
alike.
Growth stocks

have

come

to

be accepted as

separate, if
not
unique,

a

of

class
mon

com¬

stocks,

differ¬

being

entiated

from

Other types of

should

equities (viz.,
cyclical

have

grown

faster than 3%

sults

ownership of growth stocks.
Financial

!

,

Characteristics

financial

The

.

prospective

considerably

growing

wise

taining

prospects of continuing its rapid
growth in the future.

.

timent

or

intuition would

prob¬

2 The

a

practical basis of judgment in

the

identification

and

Stocks

C.

Clendenin and Maurice Van Cleave
Comment that "an almost unlimited vol¬
ume of literature has discussed the fea¬
tures of growth
industries and growth
Stocks

..

."•—"Growth and. Common Stock

Values," Journal
1054, p. 365.

of

Finance,

December,

the

Evaluation

Illustrafed

by

of

the

3 The

of

paper

is

intended

erable

in
to

consid¬

ratings by the important advisory
By logical exclusion, this will

stocks

He

-

Paul

Or.

~

Einzig

out

the

in

of which he missed

open

no

op¬

"British Council for the

Promotion of International Trade"

organization, not to be con¬

relative

to

British

official

the

.

—

he

said

that, the

USSR could double its trade with

the

Britain wanted
'

next

five

years

if

it.

& FINANCIAL

CHRONICLE

our

he said.
Kingdom
orders beyond

resources,"

own

if

the

Available

immediately in N. Y.

or

Phone—REctor

financing




in

are

British

United

additional

to

exports

ex¬

port credit guarantees.

They are
under the illusion that, since the
credits have to be paid, Russia
will have to part with gold even¬
tually.
What they overlook is
that, even if the original credits
are repaid, new credits would be
granted

under

official

guarantees,
of

amount

that

to

the

maximum

credit

maximum

would

and

over

be

out¬

even if the
it
finances

transactions

change

of

that an
corresponding
so

over

again. The
would

amount of facilities granted

enable the Soviet Union either to

those

which

of smaller gold exports, or to
crease

in¬

imports without having to
gold exports. In either

increase

Russia would obtain

case,

net

a

gain.

More Than Coincidence

I

This

campaign
with

incides
the

for

the

for credits
Soviet

withdrawal

of

co¬

demand
Western

forces

from Berlin. It is, to say
least, unusual for a govern¬
ment to approach another country
the

for

assistance

financial

at

a

that

when

moment

precisely

it

threatens

country with aggressive

tion in the

near

future.

ac¬

But pos¬

sibly this is not sheer coincidence.
Perhaps Mr. Khrushchev hopes to
be
able
to
achieve
a
bargain
under which the Western Powers
would

grant Russia large credits

return for

in

adopting

a

compromising attitude

less

un¬

Ber¬

over

lin.
It is

the

of

conceivable that

even

main

one

why he put

reasons

his

forward

demands

for

change in the status of West Ber¬

British goods without

lin is to strengthen his

process

enhance earnirig, power,
out of which a large
proportion is

that

the

Soviet

obtaining credits.

to

Government

necessarily

.*

Evidently the object of the plea
for credit is to be able to import
without having to part

with
more gold.
Now gold is the main
weapon in the economic cold war.
Yet Moscow seriously expects the
long as a strong product-demand British Government to go out of
and high earning
rates prevail; its way to enable Russia to accu¬
the growth process is self-gener- mulate more
gold and thus to in¬
ating and self-financing .3
- >
•
crease its financial power.
is

It

sensible stratagem for
companies, to retain and

a

growth

more

Continued

one

on

such technique,

page

see

31

Robert E.

gust,

C.

5

1957, pp. 31-33.
There are oases of

cient

that

internal

such

means

exceptional'
are

insuffi¬

in

financing long-term growth re¬
IBM, for example, retains'
nearly all of. its reported earnings f«»rt
plow back; yet, it has been forced to the
quirements.

bond
of

market

its capital
requirements.

1

Even If USSR Was the

Only

Country

Kennedy, Jr., "An Approach. to Pricing
Growth Stocks," Analysts
Journal, Au¬

Edwin L. Beck, c/o Chronicle, 25 Park
PL, N. Y. 7

Russia

could well afford to import more

4 As

2-9570

op¬

longfavor

loan to

efficiency of capital.. This

growth

Write

be

term

so

-

Jan. 1,. 1929-Dec. 31, 1957

Plan.

would

characterized by a high marginal

From
•

Year

Which

maintain its imports with the aid

"The Seven Year Plan is based
on

"But

reduce

posed to the granting of a

sound fantastic. But
mind

in

in
raising
roughly 40%,
funds in meeting growth

campaign is well timed. It
by exaggerated fears of
unemployment in Britain on the
eve
of the general election.
But

that

Mr

we

must bear

Khrushchev's

position in Russia depends on his
ability of increasing the volume
of consumer goods without ne¬
glecting either capital investment
or
the maintenance of superior
armed

forces.

To

be

able

to

do

so

he needs large external credits.

It

might be well worth his while
make

to

substantial

concessions

the political field for the sake

in

of

This

benefits

the

bergaining

position, in order to be : able to
obtain large credits.
This may

.

COMMERCIAL

Seven

actual

bloc

to

by

standing all the time,

increasing trade with the Com¬

a

tends

"FOR SALE

less foolish

of

munist

capable

British goods, it

more

be

Russia

Tf

even

-only; country

Council, created for the purpose

Britain in

limited

"be given to the
instead of being

And

r

the

buying

of

Countries,

Foreign

come

with

goods,
Why

Russia with the aid of official

portunity for pressing his claim.
Speaking at a lunch given by the

wants

dividends

resources

Quarters

plea for British credits.
paid a visit to Britain, in the

so-called

so.

should- "Britain's

Soviet

a

course

do

to

digging holes
in the ground and filling them
again than by increasing the out- C
put for the sake of assisting the

Re¬

with

now

with

decade; they give concrete
of relatively high re¬

again reinvested in additional ca¬
pacity. Accordingly, the growth
process makes possible, and justi¬
fies, a heavy plow-back policy. So

7 "

has

summarized in Table 1 for the

equity shares of E. I. du Pont

e

consumer

credit

unemployment

Committee for
Economic

also

cannot afford

would

-' in

t h

are very keen on
British capital equip¬

more

and

then

of

State

lations

of

cumulative, for the new capac¬
ity, once in commercial operation,

by investment broker¬

122-Bound Volumes of the

of

in a n

'Soviet

growth
ratios

but

kov, ' Chair-'

fused

of

is

'

.

lan's wvisit

steady

ment

were

are marketable in Britain,
beyond goods such as tin, alu¬
general proposition, it can minum, etc., the import of which
be said that growth companies fi¬ is not encouraged. So year-afternance their growth
requirements year Russia exports gold to pay
largely by plowing back inter¬ for her trade deficit. But Soviet
nally generated funds into new gold production is supposed to
plant capacity which, itself, is have increased very considerably,

history of satisfactory performance

growth
firms.

of

istics

As

services.

as

occasion

buying

countries?

earnings.

eliminate from consideration many of the
equities being sporsored and advertized
age

the

her gold supply;

on

countries which

potential enemy
given to friendly freedom -loving

'

byi

on

—an

stantial

and which have been assigned top invest¬
ment

a

*

„

paid for by Soviet exports,
de Nemours and Company consti¬
we
are
willing to place orders
tute an interesting example of a on credit.
If you give us credits
growth situation whose earnings we shall let you have the orders."
and dividends have increased at He also pressed for an increase
a compounded rate of 7%
of British imports from the So¬
per an¬
num
for
the past thirty years. viet Union. "If sales to the United
Throughout the history of its Kingdom could be stepped up,
growth and adaptation to chang¬ Russian purchases would increase,
ing economic climates, du Pont leading to lower unemployment."
has
managed to maintain high
The fact of the matter is that
earnings rates on invested capital Soviet Russia has a perennial ad¬
and to generate internally suffi¬ verse trade balance with Britain
cient funds in meeting its growth and the
sterling area. The Soviet
requirements and in paying sub¬ Union is unable to produce goods

Chemical

a

chev

illustrate the financial character¬

The

Common

growth stocks
to apply only

blue-chip securities which have

as

sales volume.

Industry (University of Texas,
treatment

increased demands

and :

s;

Moscow, Mr.
S.A.Skach-^

aggregates

policy), high earning rates on e quity capital, and rapid growth in

May, 1957).

evaluation

representative of this view, John

as

Products

this
1 As

in

no

Khrush-^

Mr.

characteristics,

as

evidence

descriptive framework elaborated

Growth

e

those made

7

tained earnings (heavy plow-back

a

significant growth
characteristics and thus to provide

koyan when
the United

Mr. Macmil-

1946-55

ably have to serve as the means in this paper has been derived largely
for
identifying and selecting from an empirical examination of the
chemical-products industry and its 12
growth stocks as investment me¬
leading chemical stocks. This study be¬
dia. Accordingly, the aim of this came the basis of
Ph.D. dissertation by
paper is to postulate a descriptive the author, entitled "The Concept of
framework of

with

,,-

financial

are

are

Mi-

r.:

in

>-

stocks, selected
eight leading
companies in the historically dy¬
namic chemical-products industry

virtually common knowl¬
Concerning the future, wisdom
edge in the field of investments,1 dictates that such a stock should
and, by implication, do not justify be purchased on a reasonable pre¬
further descriptive treatment. mium
and/or yield basis, so that
However, a thorough screening of the favorable growth prospects
the available literature will defi¬
are
not at the outset fully dis¬
nitely establish that surprisingly counted
by the current market
few published studies have at¬
price. If purchased at an unrea¬
tempted to formalize and organize
sonably high premium, an other¬
the distinguishing traits of growth
wise
sound
investment - type
stocks into an operational frame¬
growth stock becomes a longwork of identifying characteris¬
range speculation, and in this case,
tics. In the absence of an opera¬ the investor can
normally hope to
tionally a priori framework, sen¬
tics

M

earning power, are amenable to
quantification, and consist of such

financial

good

exceedingly

the

remarks made

by

the immediate de¬
terminants of high and rising
postulated

compounded annu¬

indicate

on

were

greater imports

S tat

ally (i.e., faster than the historical
R. E. Kennedy, Jr.
and
income
growth of GNP) in order to qual¬
stocks) by the
ify as a growth situation. Consist¬
presence of identifiable features ent with the excellence of its past
and
characteristics.
The
ever¬ performance, this stock must like¬

body of literature per¬
to growth stocks states
that such identifying characteris¬

if Russia

LONDON, Eng.—The campaign

superior investment re¬
expected from long - term

The controlling characteristic of
uptrend in sales volume, the
growth stocks is their high and growth of financial resources and
rising earning power. Per-share equity (book) values, a continua¬
earnings and, therefore, dividends tion of wide profit margins, and
tend to grow in accordance with
high earning rates " on invested
the operation of compound inter¬
capital. These financial develop¬
est.
In this paper,
a
"growth" ments, when combined with a
stock is defined as the common
heavy plow-back policy of inter¬
equity of a company whose per- nally generated funds invested in
share earnings and dividends ap¬
wide profit-margin product lines,
preciate at a long-term rate of provide the basis for the rapid and
growth substantially faster than sustained growth of corporate
the historical rate of growth of
earning power which tends to ex¬
the national economy.2
As con¬
pand in accordance with the prin¬
cerns its past record, such a stock
ciple of compound interest.
To

Investors

Berlin.

He admdnishtngly avers that
only country capable of buying more
goods it would be less foolish to engage in "make-work"
projects than to assist Russia's growth or allow her to finance

sible the

owning growth stocks has been a
to

be directed to

Russia's demands

even

which, in turn, makes pos¬

power

investment.2

fascination

credit is to Be extended

by Britain, then it
underdeveloped countries rather than
to the U.S.S.R.
Dr. Einzig fears credit may be offered to
U.S.S.R. to alleviate Britain's unemployment problem or lessen
shoiild

fundamental

the investment merits and risks of

subject of consuming interest and

By PAUL EINZIG

.

respectively, the° in favor of granting credits to
proximate and ultimate determi¬ Soviet: Russia is making appre¬
nants of high and rising earning ciable progress. Following up the

characteristics,,
concerning investment results, are offered as the pragmatic
test differentiating growth stocks from other equity types of
investment media. All in all, growth industry characteristics
are found to apply to scientific and automated industries, and
not to nature oriented and public utility industries, and contain
much of the economics found in oligopoly. They are singled
out as the better hedge against long run inflation.
nucleus of causal factors.

financial

The

,-.;

..,

factors constitute,

to comprise a

occurrence

• w.

If international

being causally linked with the
pivotal characteristic of high and
rising earning power.
For the
sake of convenience, these groups
are denoted as
(1) financial, (2)
fundamental, and (3) investment
characteristics of growth ^stocks.
These three groups form a hier¬
archy of growth characteristics..

growth stocks be identified and evaluated?

clusion.

.,."1

major groups of growth
characteristics are discernible as

ing this question affirmatively, Dr.

industry to

;

Three

at University of Arkansas

Can

The Short-sightedness Involved
In Granting Credits to U.S.S.R.

acquiring growth stocks
of decisive

matter of

getting financial aid.
It would

on

the

be very

short-sighted

part of the British

ernment

if

it

to

Gov¬

the
temptation of securing political
sians by no means the only coun¬ concessions at the cost of financial
assistance.
Any such assistance
try which would be able to import
would further increase the power
more British
goods if Britain is
of the
Soviet Government, and
prepared to grant credits to fi¬
were

yield

it must be remembered that Rus¬

nance

There

the
are

additional
many

imports.
underdeveloped

the

cost

of

further

would increase.

concessions

Volume

189

Number 5834

.

.

Commercial and Financial Chronicle

The

.

(1539)

.

Again in .1.958 the
eloetric

power

areas

of

Alabama, Georgia, Florida and Mississippi, served by the
companies of -The Southern Company system, recorded substantial

economic growth. This resulted in increased
sales of
>

and

•

earnings for

Industrial

^y;s

system companies.

our

power

sales, which accounted for half

continued to grow in
in business

diversity

activity in

homes also mounted

as

well

sales,

of

use

electricity in Southern

steadily. ;

siderably less severe,than in
four-state service

generally

of the system's total
energy

sections of the nation. The

many

revenues

in dollar volume despite a general reduction

as

The impact of the 1957-58-recession

our

electricity and higher

1.'

area

most otheri

business activity in the Southeast

on

areas

of the

for the most part,

are,

was con¬

country. Manufacturing plants in
and efficient and their operations

new

maintained at comparatively high levels. The
region's economy was
strengthened further by a rise in agricultural income and a
heavy volume of residential
;;y

were

construction.

^

than

$190,000,000 this

HIGHLIGHTS OF
t

'

y \

With further gains

ry--■'yd

anticipated in 1959,
year

for

new

--y—;

system companies will expend more

our

facilities.

OPERATIONS

Two Years in

Brief;;^yYy f96®.

Sales of Electric Energy

;

(Thousands of Kilowatt-hours)

1957
y

idfdijYY

;t

Operating Revenues

,,

.;y;, ;■

d;

' ■

17,915,065

•

$ 272,134,000.00

*

$254,536,000.00

.

$

•

$

34,822,000.00

.r%,31* $
*. i d

1.65

Consolidated Net Income p
■

■

.

38,234,000.00
'

.

WJM1M *

Earnings Per Share
(On Year-end Shares)

.

'

•

..

*.

*\

Dividends Paid per Share

* $

Construction Expenditures

* $143,513,000.00

1.2

m

Customers Served Directly

*

iOy*
'/>

'

>%:-§i*486,366

A

'

$

I.IO

* $

124,572,000.00

•

"

1,452,818
.

■
.

_

|:

■
;

Serving the Southeast through:.. ..'1..

.

..

,

i

,

.

•

.

•

-

.

\

i

.

iyy yyd;.

THE SOUTHERN COMPANY

■'

vY• vSI;-.vi" •;<..»

Alabama Power Company Birmingham,-Alabama- s*

- -

.

y:

Georgia Power Company

-

--

-

Atlanta^ Georgia

■

miss.

ga.

"

Gulf Power Company Pensacola, Florida v:V
..

,

-

Mississippi Power Company
Southern Electric

T

'

Guifport; Mississippi

Generating Company

fla:

Birmingham, Alabama

^

^

* *

*

T

ATLANTA

WrUe for




a

copy

of the Annual Report

D

•

1330 W. PEACHTREE

BIRMINGHAM
NEW YORK

•

•

600

250

N.

PARK

18th

STREET

STREET

AVENUE

19

20

The Commercial and Financial Chronicle

(1540)

Canada and Abroad

on

i.

.

Ottawa, Canada

tices in

The American courts have said:

of our anti-trust law causes serious mis¬
number of friendly countries to the U. S. A.,
besides Canada. Mr. Fulton cites examples showing what he

Anti-trus,t legislation,
have

called *it

for

taken up in diplomatic
or,

many

years,

legislation, in so far
the principle of free¬

it asserts

as

dom

of

com-

petition in
limitation of
the

freedom

of

contract,
appears to
have

been

can

origin.

later

I

may

be

of

the

fects

ef¬
E.

your

D.

that

torical
♦An

initiative,

address

federally

at

by Mr. Fulton before the

Anti-Trust Section of the New York State
Bar

Association,

of

offenses, at least
when fhey affect
a substantial
part of the market. In such cases,
per

se

-

this continent the his¬

on

be

to
Fulton

legislation, I
may be
permitted to indulge a
pardonable pride in pointing out
now

law

petition has been interfered with;
and
practices like price fixing
have been declared by the courts

extra¬

of

he went

enactment: bfefore" us,

I
doubt, was passed for the
protection of the specific public
interest in free competition.
This protection is
afforded by
stamping with illegality agree¬

is the extent to which com¬

cases

critical

territorial

S,

no

presumption for

or

'■ V;

hand,

in

case

a

"It is

no

on

trom tne common law and in the

*

to say*

quite clear that aU of

P16 abs0lute comPetl"

these'

Judges had in view the lIVTe princiPle,
possibility of a state: of circumIn recept. years other countries
stances arising m which the public ^00 k®ve shown a new interest or
interest in. restraining encroach- -J. r®viv?\ °£ ^n old interest in. the
ments upon freedom of competi- field of legislation to ^control retion might have to be maintained
*a2
monopolistic pracat some sacrifice
of the public.'^fe®ppi^S?^n<finavi^mcouiitries,
eminent

in

interest
m in
.evcn

freedom

such

of

common

^eimany and France, are
this'iiun\ber although, as
busi^ W
regimes set up out•,>."* side: the United States, Canada

contract/

commercial

trans
nsactions as the Sale of a
ness.
js'

•

v

.

An

no

rloiiht

United Kingdom are ordi-

in

legislature^ cori? $£^^2?

.

on

appear

to

anti-combines

might
, x be expected to
x operate
x~
against the public interest. That

or

Act laid down

of

,

Perhaps, be¬
cause

other

Tf'
heoahpp
interesting -sidelight on our;
Canada appear to have much in respective systehrs-s of anti-com¬ opinion of the
bines and anti-trust is the rela¬
common.
Under both systems, for
tionship they aVe from time;; to
example, the issue in combination
the

and

Ameri¬

m

"The

have

anti-trust law of the United States

essentially
North

Court

to Canada rather
than the United States, by some¬
thing over a year.
For
your
Sherman Act was
enacted on July 2, 1890, whereas
ments which, when^carried., into
our
original anti-combines pro¬
-lessenveompetit
vision was enacted on May 2,1889. effect, prevent
tion unduly and (by) rnaking such
Perhaps I should soften the ef¬
agreements punishable offenses."
fects of anything
I may discuss
Container Materials Ltd. et at vs.
later by emphasizing also that the
The King 1942 S. C. R. 147. •'
"

anti-combines

_■

&vor of competition, and requires

came

and that any

The Canadian courts have said:

channels.

belongs

least,

as we

U.

221

•

conditions'and report whether the
thingsbeing done were operating

the parties to restrictive arrange¬
Canada, emphasized the
difference between the principle ments to bring such arrangements
of the
Canadian legislation and before a trade court and there
them on one of seven
the English common law decisions justify
which, although they made certain specific grounds and to show that
on
balance they are not against
reservations in favor of, the public
the public interest. .Failing such
condemnation of the act and is
interest; nevertheless stressed the
unlawful." American Column and
rights of individuals to contractproof, the agreement will be deLumber Co. et al vs. United States freely and took a lenient attitude
glared invalid.. This 3.956 legisla257 U.S. 377.' " ' ; ■
' f
towards restraints upon trade. But tion is obviously a.long step away

laws. Concludes by recommending "self-

are

Mr.

interstate com¬
concerted ac¬
by any combinatioin of men
or corporations to cause, or which
in fact does cause, direct and un¬
due
restraint of competition
in
such commerce, falls within the

imposed restraint" and a modus vivendi—based on mutual
understanding and respect—so that actions affecting other
countries

i...

,,

tion

governed by Canadian anti-

commerce

.

Chief Justice of the Supreme

On* the

in

Co.

.

occurring

merce

alleges are undue and unacceptable inteiference witb his coun¬
try's sovereignty. The real issue, he points out, is the arrange¬
ments entered into by Canadian firms in Canada which are
combine and patent

_,„

in Canada about 1912,
Justice Duff, who later be-

106.

it has been repeatedly held

■..

competition

a

matters of Canadian

-

against competition.
But, in 1956, this Act was in
large measure superseded by a
piece of legislation which lays
down a definite presumption in

by this court that the purpose of
the statute is to maintain free

">

territorial application

givings in

*
.t.
*•

Tobacco

American

the similarities of anti-trust laws and prac¬
his country with ours, Canadian Minister of Justice—
criticizing our internal affairs—charges that the extra¬

After comparing
without

.

following two quotations, the °* trade, or which . . . injuriously
Ameri- restrained trade, that the words as
used in the statute were designed
can Column and Lumber Co. case,
"
J
to have and did have but a like
and the second from our Con¬
significance."
United
States
vs.
tainer Materials Limited case:

the

D. FULTON*

E.

By HON.

Department of

our

The similarity -between the way"
in Whictf • the faWs * in 'our twb
restricting competition, or try characterized by restrictive,
countries have been applied do¬ duly
obstructing the:due course, monopOlistic orquasi-monopolistic
mestically may be illustrated by unduly
3
. v; A
~
,
.
-SAsxas'x.-.iiiti.J
-v
v
j. :
JrLn

-,>

first of which is from your

Canadian Minister of Justice

Thursday, April 2, 1959

.

.

anti-trust act only embraced acts Commerce and

Compares Cases

Application oi Anti-Trust Laws of

.

New

York

City,

the

courts

that

the

fixed

or

both

our

countries

or

that have

prices

been

the other like restraints

that have been

erate

p

of

have held that they will not en¬
tertain any defense to the effect

imposed

reasonable,

are

mod¬
V:

^

time

thought to bear to the English
common law.
You may rempmber
in

that

Oil

Standard

the

a possibility merely, that. ^Jne1^ J®pr^S1^:
,.
legislation * was
enacted."-*'To r—V1?® Continent, it
vs.' Shrdgge (1912) 46
admitted that your legisS C. JR. 1.
"
^^ latiOB, embracing as it now does
'
*
'
i&-the "Federal Trade Commission
saw

(Standard Oil Co. of New Jersey
United States 221 U. S. 1) >of

'

•

.

1911, and the American Tobacco
case of the same year, Chief Jus¬

In the latter
".

.

it

.

was a

case

codification of

principles.

law

common

Act, the Clayton Act, the Robin-

And

son-Patman Act, and various rePieces of legislation as well

restrictive

on

he said:

Their

held in the Stand¬

was

Recent Developments Abroad

England itself, as you all
know, no longer depends upon .the
common law for putting a brake

tice White took the view that the

English

„

Weidman

vs.

Sherman Act

as

this

case

.

trade

as.the^Sherman Act, has been apcases

Oil

case

that,

,

a

total

of $13

Common Stocks ^
On Which

direct

and

^
,v

$8 billion

CONSECUTIVE

billion. Over $4

CASH

U

of

news

coverage

and

edi¬

Continued

/

on page

26

-

J' ?.v.

;

^

prominence

torially in our press, you would, I
think, be quite convinced that the
Combines
Branch,
despite its
small size and the comparatively

,i. w

DIVIDENDS

Have Been Paid From

note the

increase represents

holdings of Canadian bonds and
securities

and to

given to combines cases, both by
way

Since 1945 U.S. business and indi¬

to

that

fact

It is my belief, however, that
although the volume of the liti¬
gation is smaller in my country

ada

viduals have increased their invest¬

billion of this

making due al¬

the

than in yours, its impact is pro¬
portionately as great. If you were
to talk with businessmen in Can¬

;

CANADIAN LISTED

in Canada

over

even

for

lowance

strictive Practices

the words

as

Happening

by

has our anti-combines

your
Commission, at
'restraint of trade' at common law the express reference of the Board population is about ten times our
own.
V|j;
and in the law of this country at of Trade
(which corresponds of
the time of the adoption of the course with your Department of
Law's Effectiveness in Canada
ard

1959 EDITION

ment in Canada

far greater number of

legislation,

whereby the Monopolies and Re¬

~

Are

a

than

plied to

practices.

1948 Act set up machinery

the

investments

balance

in

is

plant

5 to 130 Years

in

and

—

20 PAGE BOOKLET

—

Complete Service in

equipment.,
COST OF THESE BOOKLETS

To service this

Canadian

investment,

Company offers
lished

1 to 199

growing interest in

our

connections

our

200

New York
On

long estab¬

in

Canada

orders

printed

to

on

_15

...

cents each

„~12 cents each

up

of

100

the front

or

more,

cover

your

firm's

„\

will

name

be

...

/.V

for

Institutional Investors

with the words "Compliments Of"

above it without further charge.

U.S.

Canadian Securities

.

•

'

J,,

';

-

Dealers and Brokers

institutions and dealers.

Corporate Executives
Write

or

Review of

telephone today for
the

Canadian

a

•

Banking

Commercial

|

Industry.

&

Financial Chronicle

Wm. B. Dana Co., Publishers

Gairdner &

N

'

25 Park Place, New York 7, N. Y.

Member:
American Stock

W. C. PITFIELD
&
.

60 Wall

Please

enter

our

order

for......copies

Common Stock Booklets," and

CO., INC.

of

Canadian

Exchange (Assoc.)

Street, New York 5, N. Y.

WHitehall 4-7380

NY 1-3760

Afjiliate:

Gairdner &

Company Limited

Underwriters

and

Distributors

of Canadian Securities

Teletype: NY 1-1979

Members of

Leading Canadian Stock Exchanges

An affiliate of

Business Established. 1921

W. C. PITFIELD & COMPANY LIMITED
15 offices across Canada and a direct

private

wire system covering all Canadian Markets.




"The

accompanying dividend tables.

30 Broad Street, New York 4, N.Y.
HA 2-9251

Company

Inc.

Toronto

By*

Date

Montreal
Kingston
Quebec
Calgary Winnipeg Vancouver Hamilton
Kitchener London

Edmonton New York

Private wire

system.

■

Volume

189

Number 5834

.

.

The Cofnmercial and Financial Chronicle

.

(1541)

ADVERTISEMENT

C I

ADVERTISEMENT

ADVERTISEMENT

7

Seventy-Eighth Annual Report of the Directors to the Shareholders
Your

Directors

results and

present

herein

their

developments of the past

report

on

the

crease

objecting provinces

lessening of demand for
many of your railway services. Nevertheless, your Direc¬
tors feel that the year was one of solid
achievement. Real

was

dismissed.

during

the

diesel locomotives in

the

and

measure

declared by The Consolidated Mining and

Smelting Com¬
of Canada Limited were sharply lower, and losses
were incurred in the operation
of your steamships, air
lines and hotels Net income from petroleum rents, roy¬
alties, reservation fees and land rents was also lower
mainly as a result of unfavorable market conditions for

Rail way revenue was 4% below that of the previous i'
year notwithstanding that higher freight rates
produced
increase of $7.9 million in revenue in 1958
and that
in 1957 had been,
adversely affected

by

day: strike.

*

\

*

-.a-

pany

•

nine-

a

•••'

•

Railway

The lesser decline-in Volume

than

from

in

resulted

revenue

increase

the

fact

Income, after fixed charges, amounted" to $32.9
represented earnings of 3% on Shareholders'
Equity of $1,113 million. After providing for dividends
of 4% on Preference Stock and $1.50 per share on Ordi¬
nary Stock, there was left" a balance of $8.6 million avail¬
able for modernizationv and other! corporate purposes.

occurred

ment, the.largest part of which is. at
the:fixed-statutory
performed in

total freight.revenue:

Rising labour costs
to your

1958

but

of all

freight

v

produce^ only 14% of;

again

expended
s

l6f

mainder

pa^mouhr concern

was

Company. Agreements,with organized employees

was

concluded only after the

ensured from

an

v.

a

re¬

communications, hotels, steamships and other

on

Gross investment in Properties at

$2,279 million,

1957;

an

year

end

increase of $49 million, and work¬
$18.3 million from

up

a...v.. Vj

:

The Income and Retained income Accounts show the

necessa^ revenue

increase in freight .rates.

railway plant and equipment, and the

ing capital, at $82.2 million^was.

January 1,

were

Of this, $81 million was

during the year.

on

properties.

for increases in wage rates recommended
by a Board of1
Conciliation which were in part retroactive to

1958,

Capital expenditures in the amount of $94 million were

undertaken

'

'T"!'V•
were

—-

..

,

13,408,712

$ 49,900,559
Fixed
Net

1

Charges

16,997,521

——-—_______

Income

$ 32,903,038

,

Dividends:

Preference

Ordinary

___!

Stock-.

$ 3,068,538

21,217,963

Stock

24,236,501

_____

Balance transferred to Retained Income Account

Retained
Retained Income

Balance

of

Income

$

$487,320,647

Account

December 31,

1958

$ 8,616,537

Net Proceeds from Sales of Lands and Town sites
of

Excess

8,616,537

Account

(Balance), December 31, 1957

Income

the year ended

for

-

4,682,211

considerations received

for sales of properties

Miscellaneous

Net

major

a

grain

service

$ 36,491,847

—

Income*.

book values.—

over

2,550,416

62^,528

(Net)

16,471,692

Income

December

(Balance)

31,

a£

1958,

per

Balance Sheet——

$503,792,339

.

million and

that

Crowsnest Pass rates,, accounted for 34%

$467,410,853
430,919,006

_

Earnings

Retained

in the movement of low-rated
grain
products while higher-rated5 general freight '
traffic decreased. The grain and grain
pirpducts move- ,

and

,

:

/

a

net decrease of only 1.5%.

■

L

Expenses

crude oil.

Freight traffic volume measured in ton miles showed

Account

_1

,

Other Income declined by $10.0 million as a result of
decreases in income from almost all sources. Dividends

:

revenue

Income

with

year

economies resulting
from the use of more efficient equipment and methods
held the decline in net earnings to $1.8 million from the
previous year. The rate of return on your net invest¬
ment in railway property was 2.7%.
This

expenses.

(Abridged)

Railway Revenue

Net

falling revenue, rising
labor costs, and the fixed nature of many railway
expenses, your management acted promptly to control

dispute as to
freight and
yard service, the activity now underway to integrate the
handling of less-than-carload and express traffic, and
the growing success of your
piggyback service which
became evident during the
year, give promise of a steady
increase in the efficiency and
quality of railway service.
on

of freight rates authorized by

Otlxcr

Faced

progress was made in the use of modern methods and
the decline in revenue was matched
by a proportionate
reduction in expenses. The outcome of the

the need for firemen

in the general level

the Board of Transport Commissioners was 17% effective
December 1. An appeal to the Governor-in-Council by

year.

The decrease in the volume of industrial
production in
Canada in 1958 contributed to a

an

21

The in¬

following for the year ended December 31, 1958:

Railway Operations

:

Net

earnings amounted to $36.5 million, a
decrease of $1.8 million, or 5%, from; the previous year.
The ratio of net earnings to gross revenue was 7.8% and
while this ratio was the same as^ that of the previous

railway

it

year,

was

substantially less than adequate.

Railway revenue, at $467 million, was $20 million, or
4%, lower than in 1957.* Freight traffic, which provided
four-fifths of total revenue, accounted for $15 million of
this decrease. Expanded common carrier piggyback serv¬
ices added $4.5 million to freight revenue and freight
rate increases approximately $7.9 million.
Despite the
yield from increased freight rates, the average revenue
for the carriage of a ton of freight a distance of one mile
decreased from 1.500 to 1.470. This was the result of a
6% increase in the movement of low-rated grain and
grain products, and a decrease of 5% in the total of all
other commodities.

There

were

and animal

II

1

C

II

L
Increase

YEAR'S

RESULTS

Railway Revenue

1958

!

—

Earnings

____^

$20,154,626

430,919,006

449,319,097

18,400,091

36,491,847

38,246,382

1,754,535

92.2%

92.2%

13,408,712

$

___

—Ordinary

Stock

POSITION

'

■

23,441,276

$

$10,032,564

14,901,935,

3,068,538

3,029,053

21,217,963

21,090,379

127,584

8,616,537

22,666,291

14,049,754

39,485

This exceeded the volume of
which between 1947 and 1958
dropped from 1,681,000 tons to 557,000 tons.
proximately 780,000 tons.

Passenger traffic decreased from 1.3 billion to 1.1 bil¬
revenue passenger miles.
The number of passengers
carried declined from 8.0 million to 7.7 million, and the

passenger journey, at 148 miles,, was 18 miles
shorter than in 1957. In addition to a decrease in ordi¬

average

nary passenger traffic, decreases occurred in military
traffic, immigration and other traffic originating in Eu¬
rope, and in interline traffic.

Mail revenue decreased, partly as a result of passenger
train service reductions to eliminate unprofitable services.

63,940,973

$18,256,531

163,197,279

136,334,723

26,862,556

2,278,665,735

2,229,262,112

192,471,000

144,133,500

82,197,504

$

_______

2,095,586

■

.

Investments

$

Express revenue was up slightly from 1957 as a result
of rate increases.

and,

Properties
Funded

decline, there were, in addition to the increase in volume
of grain and grain products, increases in fruits and vege¬
tables, iron ore, lumber, wooclpulp, paperboard and
canned goods. The volume of merchandise traffic han¬
dled in piggyback service for common carriers was ap¬

lion

Stock____„____

Working Capital

$

16,997,521

Balance for Modernization and Other Corporate Purposes

YEAR-END

Decrease

'

ments, automobiles and newsprint; miscellaneous com¬
modities, mainly petroleum products, cement and lessthan-carload merchandise. Contrasting with this general

less-than-carload traffic,

Interest and Rental Charges

Dividends—Preference

'

or

487,565,479

Ratio Railway Expenses to Railway Revenue
Other income

1957

467,410,853

$

Railway Expenses
Net

marked decreases in ton miles of animals

products; mine products; logs and pulpwood;

manufactured goods, including non-ferrous metals, iron
and steel products, heavy machinery, agricultural imple¬

_____—

Debt

49,403,623

*

48,337,500

as a

Expenses increased less than revenue
result, the net earnings of your Express Com¬

pany carried to railway earnings as compensation
the carriage of express traffic were higher by 1%.

for

Railway expenses, at $431 million, were $18 million,
4%, below the previous year. This decrease was in
proportion to the decrease in revenue and was
achieved through reductions in maintenance work and
savings produced from capital outlays, notably for diesel
locomotives, despite the fact that higher wage costs
added $9.7 million to expenses.
or

TAX ACCRUALS

full

Income Taxes

$

23,640,000

Property and Other Taxes________l__

30,500,000

$ 6,860,000

10,909,292

11,290,160

380,868

54,367,279

58,493,389

$

TRAFFIC

It has been deemed

Tons of Revenue Freight Carried.Jrik-i-i.
•.

i

'

-

'

Revenue Passengers Carried
"

8,037,390

7,745,860

"*
r

•

f

"j >&"

-

-

'

.

•

1.47c

1.50c

Revenue per Passenger

3.08c

2.89c

EMPLOYEES

\

Mile__

'V •''V'

"

Employees, All Services.
Total Payroll

$

316,116,884

$

.

-

-

0.03c

0.19c

they would have been had the user basis of depreciation
continued for the full year.

Road maintenance expenses were 3% below those of
This decrease was the result mainly of reduced

repair work on structures.

6,867

322,226,843

$ 6,109,959

tures

t

.




»

it**-?.

$
A'''*'

'•

'
'

3,815

$

•

'

3,591

224

were near

Track maintenance expendi¬

the level of the previous year.

Equipment maintenance expenses decreased 2%. There
was

Average Annual Wagre_-__—

prudent to adopt in the accounts

Company the straight-line basis of depreciation
adopted by the Board of Transport Commissioners for
rate-making purposes. This change was effective July 1,
and depreciation accruals were $1.7 million higher than
of your

1957.

'"

89,720

82,853

___^_

291,530
'

-

Revenue per Ton Mile of Freight_____

.

4,126,110

,

a

marked decrease in locomotive repair expenses as

fewer steam

locomotives underwent heavy

repairs, al¬

though this was partly offset by an increase in diesel
locomotive repair expense as more units came due for
extensive overhaul.
Freight car repair expense was

22

The Commercial and Financial Chronicle

(1542)

ADVERTISEMENT

ADVERTISEMENT

down 6%.

There

repaired during
major repairs.

was a

the

Balance

particularly those requiring

decreased 5%, and for the
the ratio of transportation ex¬

expenses

successive

year

Working capital, at $82.2 million,
Investments

to railway revenue was reduced. The increased
of diesel locomotives in road and yard service and oi

penses
use

chases

freight train speed and train load.
high in gross ton miles per freight
train hour, which in 1958 represented an increase of 57%
recorded in average

This resulted in a

Income/.:///',/

income taxes, amounted to $13.4
decrease of $10.0 million from the previous

-Other Income, after

million,

a

year.

-

-

.

on an

work

on

the

extension; and the adverse effect on
Hotel from the strike of British
Steamship employees.

new

Stock

of

pur- .
Smithsons' *

certain
for

Dividend income, at $7.9 million,

;

was

r

down $4.7 mil¬

share amounted to
$6 ,730,000, as compared with a rate of $1.35 per share
amounting to $11,356,875 in the previous year. Earnings
per share of that Company were $0.86 in 1958 and $1.13
in 1957.
Net

:

income

//•//

>

ated

crude oil and the transfer, of certain
revenue-producing
mineral rights to your wholly-owned

Oil

Gas

/

Limited.

Royalties were re- \
ceived by your Company on 11.2 million barrels of crude V
oil production as compared with 17.9 million barrels in
^
and

1957.

At the end of the year there were 720
producing
wells from which royalties were

being received

pared with 895 at the end of 1957.

Particulars

revenue-producing mineral fights transferred
in

the

section

company.;'';," "•
;

the

of

/ '/,

Report

covering

the

://■''•,. ;j i V;.: ' /• -VT.^'y

com-J

as

as

to the.'

are

given

subsidiary"
;»;■/,
.

for

other

resulted in

Steamships-

„

v,-.;

/:/<./;.:

The keel of your third rievv 'passenger-cargo^linqr was;
laid on January 27, 1959.; This vessel, which will

in your

modate

accomf

1,050 passengers and will be the largest in
your ocean fleet, is expected to enter regular North At-,/
laiitic service in/the spring of 1961. Passenger
carryings

enterprise and $20 million from the increase in *
Ordinary Stock outstanding owing to conversions ,of- Col-

-i. :"V V'-

*

.

/:/"','.•

•

Finance

/;*'///
/y/:
.i'/y- *?'•

f:

As noted in the last Annual Report, Twenty.-five Year.
5% Collateral Trust Bonds, dated February 1, 1958, were.
issued and
secured

sold in

the

by pledge

Consolidated
June

of

your
passenger-cargo liners were well maintained,
having regard to prevailing conditions.v;////;/•'/
' I

The "Empress of England" completed a successful first
in West Indies cruise service,
having replaced the
./
"Empress of Scotland" which was sold early in 1958.

principal amount ;;of $40 million,
million principal ' amount of

of $48

Debenture

Stock,

over

'

season

Because of the increased

.Vy////^/;//-'V/;&r

capacity of the

new,

vessel, and

)
-

the higher standard of its facilities, the number of cruise

The Royal Trust Company," as •Trustee,:
agreement whereby $20 million principal
amount
of
Equipment Trust Certificates was: issued, >
guaranteed as to principal and interest/by your Com¬
pany.
This issue, designated as Series O, maturing in
equal annual instalments from Juiie/i, 1959,/to June 1,
2,

entered into

passengers, reached

,

an

post-war high.

a

/ ;;

'

/ ;/'

/''

"//

Cargo operations between United Kingdom and Great
Lakes ports, which were inaugurated in 1957 with two
small
chartered vessels, were continued in 1958 with
four >ucli vessels./ With... the' opening of the Si Lawrence
Seaway iri 1*059, it is planned to operate jhis service with;
four chartered ships,: but two; of these will be
slightly
larger and faster than those operated in 1958.
*
jy!
,

inclusive, is payable in Canadian currency,^ and
4Vk% per annum. Under.;the agreement,
equipment .constructed or to be constructed at an/esti--*"/

.

-

;. Three
of your coastal steamships were sold
during the
$25,016,546 in Canadian'funds isleased to /
yeaf/; The "Yukon Princess," formerly assigned to the
your Company at a rental equal to the! instalments: of
Alaska service, was sold in April." The "Princess of" Al7r
principal and interest on the Equipment/Trust Certifiberni" and the -'Queen of the North," which had
served}
c'ates;
■/,/y
•' /'•/'

mated cost of

■

r

subsidiary, Cana¬

Pacific

I960; and

Negotiations with employees of the Royal York Hotel
an agreement, effective until August
15, 1960,
providing for graduated wage increases.

capital cost allowances.

1968.

from

increases to'September

wage

benefits.

bears interest at

.

petroleum rents, royalties, reserva¬
tion fees and land rents, before provision for income
taxes, amounted to $6.8 million, a decrease of $1.6 million.
The decrease reflects generally unfavourable markets for ~

dian

Prairie and

on

to the Board will not include the diesel issue.

24%, since 1949. The increase in Shareholders'/EquityIn;

Oil

Dividends from your holdings of Capital Stock of
The Consolidated Mining and Smelting Company of Can- :
rate of $0.80 per

engineers

this period amounted to $255 million, of. which $235 mil¬
lion resulted from the reinvestment'oLretained .earnings

//

lion.

ada Limited at the

*:

rules changes and reductions in arbitraries; and
additional paid statutory holiday in yard service.

Minister of Labour has advised that the terms of refer¬

lateral Trust Bonds.

services amounted

resulting from higher labour costs,

-

.

Shareholders' Equity per $25.00 of capital stock
amounted to $56.50 at year end, an increase of $11.00, or

v

to $2.4 million as compared with $2.2 million in the pre-"
vious year.
An improvement in revenue exceeded the t
increase in expenses

an

Negotiations with locomotive

,

from communication

35

ber of

appeal from the decision of the Board of Transport'

tions in respect of

•

Net earnings

with

employees

motive

,

of the Empress

Columbia Coastal

for

Requests were made by unions representing operating
employees for wage increases amounting to 25% for
conductors, trainmen and yardmen, and 18% for loco¬

$18.3 million.

included

Commissioners which in effect deprived your Company
of the advantages provided by the Income Tax Regula¬

Operation of hotels resulted in a deficit of $2.1 million 1
as compared with a profit of $97,000 in. 3 957.. The de- crease reflected increased wage costs; the limitation of
facilities at the Royal York Hotel owing to construction
revenue

was up

ence

Steamship operations resulted in a deficit of $1.2 mil¬
as compared
with a profit of $2.0 million in 1957. /
from your ocean steamships was ad¬
versely affected by depressed ocean rates, particularly
on grain and flour, and reduced eastbound traffic.
Pas¬
senger volume was lower largely owing to reduced im- :
migration traffic, and fewer sailings as a result of the
withdrawal from service of the "Empress of Scotland"
which had operated for eleven months in 1957. Opera¬
tion of your coastal steamships resulted in a deficit. The
decrease in revenue, owing to the strike of steamship
employees on the Pacific Coast, was greater than the
j

weeks

the amount
Disputes over wage rates and other matters led to a
from taking
strike by personnel of your British Columbia Coastal
capital cost allowances for tax payment purposes in ex- /
Steamships
service from May 16 to July 26. Service was
cess of depreciation accruals charged income, increased
resumed under terms of an Act passed by the Parliament
by $2.2 million. A decision was made by your Directors
of Canada placing the operations under control of a Fed¬
not to claim capital cost allowances in excess of depreci¬
eral Administrator./Agreements
extending to August
ation accruals in respect of rail property. This step was
1961 were concluded early in 1959, providing for gradu¬
taken as a result of a decision of the Governor-in-Council

Freight revenue

.

vacation with pay to

increase in

The Tax Equalization Reserve, recording
of income tax liability arising since 1954

lion

•

an

three

years or more of service.

the resultant transfer of assets.

,

decrease in expenses.

Preference

from

Pacific Regions were continued.
Negotiations with the
after retirements, were
firemen's union, which attempted to revive the issue of i
$49.4 million. The railways and undertakings of nine
the use of firemen on diesels, were not successful, and
wholly-owned leased railway companies having a. book
the union requested that the matter be referred to a ;
cost of $22,510,584 were vested in your railway. * The?.<
Board of Conciliation to hear all items in dispute.- The
total book cost of railway properties is not affected by

'

Other

and

weeks

-

Company

your

benefits; and

The net additions to Properties,

new

1948.

over

Common

by

four

$385,000, respectively; and Capital Stock and First Mort- ;
gage Bonds of Northern Alberta Railways Company in
the amounts of $1.1 million and $2.0 million, respectively.

again

service and operating efficiency, and inci eases were

of

made

Thursday, April 2, 1959

engineers, firemen and hostlers, and for a num¬
changes in operating rules. An agreement effec¬
tively; Preference Stock of Smith Transport Limited in - tive to January 1961
was
reached
with
locomotive
the amount of $137,000; Capital Stock of Canadian Pa-'-'; engineers
on
Eastern Region providing for wage incific Transport Company, Limited, and Canadian Pacific
creases
of 40 per hour from July 14, 1958, 3%/ from
Steamships, Limited, in the amounts of $1.0 million and • March 14, 1959, and 4% from October 14, 1959; for

in passenger

cars

fare

$2,655

Holdings Limited for $7.7 million and $510,000, respec¬

service resulted in a savings
in fuel, train crew wages and engineliouse expenses oi
some $10.6 million as compared with the previous year.,
The proportion of total transportation work performed
by diesel power in the year averaged 89% in freight
service, 91% in passenger service and 89% in yard serv- .
ice. Notable improvements continued to be effected in
rail diesel

Sheet

increase of $102 million.

an

.

.

ADVERTISEMENT

Total assets at the end of the year amounted1 to

million,

Transportation
fourth

reduction in the number oi cars

year,

.

!

v

'

•

the West Coast of Vancouver Island and Northern British *

'/,• t:

Serial

were

equipment obligations amounting/to -.$8,018,000 /
discharged; $3,618,500 Convertible / Twenty /Ypaiv.:

Vk % Collateral Trust Bonds, $8,000 Convertible Fifteen
Year 3Vi% .Collateral Trust Bondsiand ;$t8,(K)0:G6nvor/;
tjble Seventeen Year 4%, Collateral./Trust, Bond^tVv^i'd
converted into 145,512 shares of Ordinary. CapitalySto^k.'"*
•;

V

buildings and equipment; This-loss reflects the operation
frequencies; on light-density routes

of restricted

The

foregoing transactions resulted, in/a riet' inerease/1
$48,337,500 in funded debt, an increase, of> $43,626,600..;/

of

in the amount of Consolidated
nk?

i'

K»/»n/iAn

\

which/is^

Debenture.Stock^Ifedged

r*V

O

flQT

^"l-k

W iA'I

i v*4

Net income from

interest, separately operated proper-[
ties and miscellaneous sources amounted to
$3.8 million, :
a decrease of
$1.4 million. This was the result of charges :
against income arising from losses of Canadian Pacific;
Air Lines, Limited,
and
Canadian Pacific'Transport"
Company, Limited.
Fixed

Charges, at $17.0 million, were $2.1 million
higher than in 1957 as a result of the issue of $40 million
Twenty-five Year 5% Collateral Trust Bonds, dated
February 1, 1958, and $20 million of 4M>% Equipment

of

Certificates, Series O, dated

yFund,'/ introduced in. the summer oLT 958.; <■
respect of employees covered by- the UnitedZ- y- Re-ven ue froni' international 'services increased 29 % JI
States Railroad Retirement Act.
All-routes showed substantial improvements in
/fv •
traffic,'

a

Charges

Fixed?)

Trust

/ Revenue from domestic services iReefe'ased^-'21 %;; Cer-1
tain schedule and charier services weTe discontinued ini
•;
"7"~ • ~c:"~y
Pension expense amounted to $22.3- hiillioiT, ahdiiCrease/- 1957 and fhbur e was reduced activity • in the British Co-4
eff $1.0 million, or 4%. This
outlay comprised the portion^, lumbia forest and construction industries/- A new service
Of pension allowances currently paid, by your Company;W from Vancouver to Kelowna, using DC-3 aircraft, was <
t"

•\

contribution of $6.4 million to the Pension Trust

surance

June 2, 1958.

and

amounted

to $5.1
'
:

million.

This compared with

Income, after fixed charges, at $32.9 million, was
by $13.9 million. After provision for dividends on
Preference Stock, earnings available for dividends on
Ordinary Stock and for reinvestment amounted to $29.8
equal to $2.09 per share on 14,211,783
shares of Ordinary Stock
outstanding at the end of the
year, compared with $3.11 per share on
14,066,271 shares
at the end of

Dividends
same

rates

as

was

195if.

were

declared

on

Preference

Stock

at

the

in

J957, comprising 2%> paid August 1, 1958,
and 2% paid February 2, 1959. Dividends on
Ordinary
Stock amounted tp
$1.50 per share, the same as for the
year 1957,
comprising 75 cents paid August 1, 1958, and
75 cents paid
February 27, 1959.
,

Land Transactions"

land, 4,485 acres of farm
land, and mineral rights in 36,787 acres of land
conveyed
to your wholly-owned
subsidiary Canadian Pacific Oil

sold

Gas Limited.
in

prior

Contracts

involving 6,375

years were cancelled.




of

Santa

Vancouver

Wages and Working Conditions

\ Early in the year your Company affirmed its intention
tp implement the Report of the Royal Commission which

-

aircraft, together with
simulator.

the

Board

of

Transport

As

increase in freight rates
Commissioners, agreement

acres of

land

40

hour from January 1, 1958, 3% from
September 1, 1958, and 3% from April 1, 1959; an in¬
crease to $4.87 from
$4.25 in the monthly contribution
paid by your Company per employee for health and welper

and
-

one

Britannia and

result of the

were

end.

one

DC-6 flight

sold, leaving

fleet '

a

-

application filed with the Air Trans-

Canadian

Pacific

Oil

and

Gas

Limited

Your

wholly-owned subsidiary Canadian Pacific Oil
and Gas Limited, incorporated
January 3, 1958, issued
shares of its Capital Stock to your
Company in exchange
for certain mineral rights.

to which the

of

a

an

dispute had been.referred. The agreement,
effective until December 31,
1959, provided for wage in¬

Montreal-Madrid route; the'
on
services between

aircraft

port Board in 1957, and in accordance with the Board's
Report following public hearings, your Air Lines will be
permitted to operate a transcontinental service, limited
to one flight per
day in each direction, between Vancou¬
ver, Winnipeg, Toronto and Montreal.

reached with the unions
representing the non-oper¬
ating employees for increases in wages and benefits on
the basis of recommendations of the Conciliation Board

creases

the

Five DC-3 aircraft

of 41 aircraft at the year

May 13, after three days' duration, by the signing of an
agreement.
It provided that firemen
having seniority
prior to April 1, 1956, would continue to work as
such,
but would not be
replaced, and that while the employ¬
ment of those
having seniority from that" date onward
would be terminated, they would be
given preference for
re-employment with your Company in other capacities.

Following authorization of

on

Britannia

New equipment placed in service during the year con¬
sisted of six Bristol Britannia turboprop and four
DC-6A

had found that firemen
were!not required by your Com¬
pany on diesel locomotives in freight and yard service.
A strike called by the firemen's union was terminated on

by

Maria
of

and

Europe, the Orient and Honolulu;
special fares all contributed to this improvement.

was

Net proceeds from sales of
lands and townsites
amounted to $4.7
million* a decrease of $2.9 million. Sales
included 9,587 acres of timber

ana

and

'

introduction

Net

This

services^
recording the greatest increases.; The addition of Edmoh-ton as a traffic point on the Vancouver-Amsterdam
route

Dividends

down

million.

with the Mexico-Madrid and Vancouver-Orient

| Contributions by your Company in respect of employee
health and welfare benefit plans and
unemployment in¬

$4.7 million in 1957.
Net Income

-

and levies in

-

In-its

Company

first

year

of

operation

received

on

1.9

producing wells.

million

barrels

of

Oil

your

received $687,000 from the
from the Parent Company.

transferred

and

mineral

Royalties

crude

oil

Gas"

rights
were

from

299'

Ten gas wells were drilled of which six

Number 5834

189

Volume

.

.

The Commercial and Financial Chronicle

.

(1543)
ADVERTISEMENT

-ADVERTISEMENT

proved to be commercially productive and are presently
capped. In addition, working interests averaging 37l/2%
were
acquired in three commercially productive gas
wells drilled

.

Alberta

of

has been

thereunder is expected to

lines

-A

of

railway.

your

trackage,

fifth

and
them.

serve

consecutive

Of

total

a

these,

of

151

miles

31

required
was

con¬

,!

•

award for

public safety was re¬
Council in Chicago,
Company to provide
safeguards against injury continues to meet with
gratify¬
ing results.

ceived

from

the

National

Safety

and the constant endeavour of
your

signed, and delivery

commence late in

the

structed .to

.

Pipe Lines Limited of gas to be produced from wells in
the Province

During the year, 591 new manufacturing, warehousing
distributing businesses were located on or adjacent

industrial

:■ ■
.■
'■,
- /■ "T ■
,•
•
An agreement providing for the sale to Trans-Canada
;

ADVERTISEMENT

and;

* to

by other companies under farmout agree¬

ments.

1959.

being brought into use. Studies along these lines
being directed toward determining maximum utili¬

are

are

zation

of

motive

United

States

Subsidiaries

Construction

•;

Nelson
^

from your holdings of. General Mortgage

Income

In-u

has

been

.

Winnipeg to

completed

of

accommodate

other departments.

and

Bonds and Common Stock of the Minneapolis, St.

come

and

-

buildings

factors

"•;

-

design
where the

The

extension

-new

to

the

Royal York Hotel was
February 21, 1959. This extension

.

formally opened on
$483,000. Of this amount $131,000 was from interest
has added 400 new
rooms, bringing the total of 1,600,
$352,000 from dividends. The net income of that '• j
and provides additional
banquet and convention facilities.
Company in 1958, after provision for fixed and con tinTelex,
the
teleprinter exchange service operated jointly
gent, charges, was $2.0 million, an increase of $334,000.^
with; Canadian National, was extended
through arranget: Interest income amounting to - $115,000 was, received > merits'
/With theWestern Union Telegraph Company to
from your holdings of First Mortgage Income Bonds of ^
connect with points in the
United
States.
This service,
the Duluth, South Shore and Atlantic Railroad
to

and

•

.

:

addition

The

net income

fixed

and

while

in

that

of

Company,•, after provision for
charges, amounted to $134,000,

contingent

1957

income

was

tingent charges in full.

of the

not

sufficient

J

/

Income

Mortgage

Wisconsin

Central

to

meet

,

con¬

\:i:.

from your holdings of First

Income

General

-

Bonds,

and

Railroad

Mortgage Bonds,1
Common Stock

=;

acceptance, now links a net¬
Canada, United States, United
Kingdom, Europe, Africa, Australia, Japan and South
America. .The television
network, also operated jointly
with1 Canadian
National, was extended to include Trois

Rivieres.;

•

,

in

entirely

presentation

for management.
The first application

September 16, an application was submitted to the
of Transport Commissioners for a 19% interim

tions

Board

the

on

the

of

It

is

as

a

in

the

last Annual

;

anticipated

Directors

your

that

capital

appropriations

effective

more

The appropriations for rolling stock include provision

64 diesel locomotive units and 2,150 freight cars
comprising 1,500 box, 500 trailer flats, and 150 covered
hoppers.
for

Patrons, Officers and Employees
Directors

welcome this opportunity to express
again to shippers and the travelling public appre¬
patronage of Canadian Pacific services
throughout the year and to acknowledge the continued
efficiency of officers and employees which is so essential
to the progress of your Company.
ciation for their

For the Directors,

tool

;

«

N. R.

I

of simulation of physical
opera¬

computer

was

for the

1959 will amount to $78.9 million.

year

output, and the provision

information,

new

forecast

by

once

Integrated Data Processing

finements

those

to

authorized

Your

■

.

the year, further important
segments of the
of your Company were
mechanized, using
high speed electronic computer. Emphasis in the
Integrated Data Processing programme moved to re¬
of

general level of freight rates to cover
additional costs that would be incurred on wage settlement with your non-operating and
other employees.

in

the

Rates

in

wide

paper .work

1957.

increase

received

subscribers

.During

$601,000. Of this amount, $518,000 was from interest
$83,000 from dividends. The net income of that
Company,
after provision for fixed and contingent
charges, amounted to $441,000, an increase of $251,000
and

On

has

of

;Y" YYY/-'

Company amounted

to

over

which

work

car

terminal

Report,
during the year.
These included $3.3 million for the purchase of the 300
flat cars for piggyback services, $1.4 million for 6 rail
diesel cars and spare components, $1.0 million for con¬
struction of new trackage and $1.6 million for additions
and replacements to communication facilities.

■

Company.

of

Capital appropriations amounting to $10.4 million, in
were

"

Paul and Sault Ste. Marie Railroad Company, amounted

power

in

Capital Appropriations

at

communications

and

equipment, evaluation
facilities, and other
problems
computer can be used to assist
management to select from a number of different possi¬
ble courses of action, that which will lead to the highest
degree of operating efficiency.
of

>

-

completed, and the results

CRUMP,:
President/

Montreal, March 9, 1959.

-

i

A judgment

was issued by the Board on November 17
authorizing an increase of 17% effective December 1,
to which reference has been made earlier in this Report.

;

CANADIAN PACIFIC RAILWAY COMPANY

The application also requested such additional relief as
would permit attainment of the permissive
level of

earnings established by the Board
Company. Hearings will commence
the

application

Increases

May 19, 1959.

on

in

freight

rates

as
on

;

fair

for

General Balance Sheet, December 31, 1958

your

this section

of

ASSETS

•

averaging

LIABILITIES

CURRENT ASSETS:

3%

granted'to
railroads in the United States were made applicable in
Canada to international, overhead and certain import,'
export and related traffic, effective February 15, 1958, by
authorization of the Board of Transport Commissioners.

Jw

•

LIABILITIES:

CURRENT

Cash

$

Temporary Cash Investments.

i

__

Accounts

38,692,145

Payable

Wages

and

Accrued

41,528,531

Special Deposits/

,

Taxes

4,893,937

$

Accrued

51,422,777

14,946,532

:

Your Company continued to secure competitive freight

•

AseHts^and Conductors' Balances..

traffic

through negotiation of agreed charge contracts.
One hundred and thirty-five such contracts were
put
into effect, the largest number in any one year, bringing

to 364 the number in effect at year. end.

Railway

mail rates
December 1, and there
-

rates.

■'

;

During the

were

;•*

■;
■;

*.

were

increased

.

17%

.

;

.v

;

Material
;

.

J ;

Y <">■Y

12,628,696

.—

11,538,747
$

44,942,276

____

■'

-

'

90,536,752

'■
LIABILITIES

3,380,902

PAYMENTS AND MORT-

shop at Calgary was
in operation at the end of the

GAGES ON PROPERTIES..

*

...

3,137 922

DEFERRED CREDITS AND
RESERVES:

UNSOLD

LANDS

AND

PROPERTIES

9,332,178
Deferred

Credits

$

—

'

INSURANCE

5

was

:

••

Other Current Liabilities

DEFERRED
DEFERRED

were

to the maintenance

completion and

Supplies

19,987,191

Declared

$172,734,256

diesel-hydraulic yard switchers.The third stage in the gradual enlargement of the diesel'
maintenance shop at Montreal, to keep pace with the increasing use of diesel power, was completed, and an
extension

and

Receivable

**•'.;;:

increases in certain express

122 diesel units

and

Accounts

Dividends

effective

acquired in the
furtherance of the diesel locomotive programme. These 1
comprised
106 diesel-electric road - switchers and
11
diesel-electric

Other

22,690,176

•<

-Services

r

year,

-

>

FUND.,

v."'"

"\t

'

4,081,852

13,188,540

/

'

Tax

.

Equalization Reserve

35,000,000

DEFERRED DEBITS:

Prepaid and Unadjusted Charges.-$
Unamortized

near

Discount

on

4,788,088

13,188,540

Reserve—.—

Insurance
■1

Investment and Other Reserves

6,380,714

Funded

58,651,106

year.

'

.Y

'"Debt

4,526,814

New

freight train cars numbering 2,091 were placed
in service, including 300 flat cars equipped for
piggyback
service. In addition 300 refrigerator cars were modern¬
ized to meet traffic requirements.
Twelve rail diesel

cars

were

At year end there were 55 of these
service operating on 4,400 miles of route.

INVESTMENTS:

cars

ties

and

Other

was

installation

completed

Montreal

and

of

centralized

on an

traffic

control

system

of

STOCK—i.—

292,548,888

SHAREHOLDERS' EQUITY:

V

Preference Stock

PROPERTIES:

Railway

;

$2,053,450,358

Communications

•

Hotels,

.

87-mile section of the line between

Toronto

192,471,000

——

38,122,158
163,197,279

'

"-'-

which

permits the direction, by
signals and switches, of
trains over the main line or into sidings, thereby in¬
creasing the efficiency and capacity of the line.
means

Companies

the

a

DEBT..

*

125,075,121

J

re-ballasting of 317 miles of;,
track. Automatic block signals were installed on 53 miles '
of road, bringing to 3,267 the total
miliage so equipped.
The

$

:

DEBENTURE

in

The track replacement programme included the laying
miles of new and relay rail, the installation of

FUNDED

Controlled Companies.....

903,544,379

PROVISION FOR DEPRECIATION

*.
,

of 547

million

9 314 902

*-)

t.

added to your passenger

train fleet.

1.8

remotely controlled

1

57,303,370

Steamships

.

Ptlier. Properties

Ordinary

Stock

Premium

on

Donations

72,160,713

....

Retained

84,706,552

$

i—

—

.—

137,256,921

355,294,575

Stock—

37,999,049

Grants

79,094,901

and

Income

503,792,339

(Balance)—

1,113,437,785

11,044,742
2,278.665,735

•The construction of two vertical lift bridges and re¬
lated works for the St. Lawrence Seaway Authority at
the location where your railway crosses the seaway near

$2,654,570,812

•

,

Montreal
The

--

was

carrier

S. J.

Comptroller

.

" AUDITORS' REPORT TO THE

■

/"

SHAREHOLDERS

OF

r

CANADIAN

"

PACIFIC

J

;l Your Company added

to its highway operations by
acquiring control of Smithsons Holdings Limited, which

Company wholly

W. LIDDY,

piggyback

Lakes and into Western Canada.
;

$2,654,570,812

virtually completed.

common

service, introduced
between Montreal and Toronto in October, 1957, was
extended to New Brunswick, to the head of the Great
^

Smith Transport Limited, Can¬
ada's largest trucking concern, and a number of related
companies in the highway transport business.

:t.

We

,£tihe

owns

RAILWAY

have examined

a

COMPANY:

the above

related financial statements,

included" such

"inr. the
In

Top priority was given to the co-ordination of rail and
truck operations with a view to effecting complete inte¬
gration of merchandise traffic services. A new depart-

tests

of

General Balance

and

accounting

have

records

Sheet of

obtained

all

and

other

Sheet

and

the

the

Canadian Pacific Railway Company as atNDecember 31,

information

supporting evidence

and

explanations

and such

we

have

required.

Our

1958, and

examination

other procedures as we considered

necessary

circumstances.
our

opinion

the

General

Balance

related

financial statements are properly drawn up so

as

to present fairly

-

•

ment,. Merchandise Services, was set up to study, plan
and
implement
by
progressive
steps
the necessary
changes in organization, administration, methods of

operation, facilities and equipment.




23

•

J

ry.. the financial

position of the Canadian Pacific Railway Company at December 31, 1958, and the results of its operations for the year

*

then

ended,

according to the best of our information and the explanations given to us and as shown by the books of the Company.
<

PRICE,

Montreal, March 6,

1959

*

■

WATERHOUSE

&

CO.,

Chartered Accountants.

The Commercial and

M

Financial Chronicle

...

(1544)
California Bank, Los

at

Angeles,

Thursday, April 2, 1959

Continued (from page 6

Frank L. King, President,
announced.

Calif.,
aas

News About Banks
CONSOLIDATIONS
NEW BRANCHES
NEW

Trust Company of
whose
proposed

Guaranty
York

with J. P. Morgan & Co.
Incorporated is awaiting approval
by banking authorities —an¬
nounced plans to reconstruct and
enlarge
the
building
at 44th
Street and Fifth Avenue, in which
one of its three midtown offices is
merger

located,

past century in

highlighting the

The exhibit will be at

New York.

the bank's main office on Avenue
of

Americas

the

Street

40th

at

through April 17.

HnisOffic?'

OF

plate the addition of 12 stories to
the existing structure, so as to
create a 23-story modern, fully

Total resources

Deposits

air-conditioned building.

231,220,412

31,'58

246,737,931

212,246,348 225,966,923

■

Cash and due from

proposed merger of Guar¬
anty Trust and J. P. Morgan &
The

U.

S.

35,380,655

Government

security

56,427,459

holdings

.
.

.

the result of advocacy. 'It; will be .employment for large discretionof the absencd of alter- ary increases without any restraint
nattves.
'
' r- :
• ^
y
0f any kind.
:
•

,

A formal ceremony has marked. foecause

the completion of structural steel
erection for Los Angeles tallest
commercial

clearly

California
Calif., new

building/

Los Angeles,

Bank's,

L.

if'^e

insist

on

perfection in this

nothing,

economists /by

professional

President

King,

com%Vtor acT*

are

we

cept the
need for such' mpr?* effort, we shall also probably end
yention.
The
recent survey of Up doing

the

of

Assistant to the Presi
Bethlehem 'Pacific
Coast
Corporation affixed tradi-

dent,
Steel
tional

Federal

final

the
32,253,532

banks

-

Soracco,

Mar. 12,'59 Dec.

—

-,J?:

short of perfection in this effort
and still improve vastly on the
present situation. The present situation, to repeat, allows at full

PASSAIC

COUNTY, PATERSON, N. J.

i

Beverly

n.'

$13*000,000 Head Office.

NATIONAL BANK

THE

or an aPProach to full employ- '
ment means inflationary price and
wage increases< Such jntervention, when it comes, will not be

Ind thf Beverly

Office

/Frank

contem¬

plans

its 100th anniver¬

To celebrate

sary, Union Dime Savings Bank,
New York, has opened an exhibit

w

announced

The

laree^office?

the1bank's
Main

fho

Unpopular

And Can ke Prevented

:

During the past ten years Mr.

CAPITALIZATIONS

New

Inflation ii

California

President by the board of direccors came in 1950.
(;

Bankers

and

OFFICER^, ETC.

REVISED

joined

Palmer

vMr.

Bank in 1946. His election to Vice-

state

and

steel

2-ton

flags to

62,875,414

4s-

,

-.v/'--/'.:"

,_r.

conclusion

this

to

,

.

*

very

the

,

.
The actual procedures will require discussion and it is worth

:

,

is

economy

is to correct a fault in
SyStem not to assess blame,
r
'
■
;
'
task

i_

willingly

ft

ft

-

.

,

,

come

signaled the 267-foot hoist.
/i V-v/

against inflation.' It. can be

assumed that economists have not

and

beam

Pr°blem is that the

inf

p'on

isthe
perhaps
more/s'toking is hoping that this T will get under
the wa
need lor sufih inter- wav nrorrmtlv
irrmlicit in the:tihiloso-^Legislation
now,
vfnuoa 1S impiicit in ine pnuoso
pending under the sponsorship,
outness Jviarcn phy and economic pronouncements amono- others of Senator rvMawas approved by stockholders of
The Hunterdon County National 14,
the- merger of Baker State nf the nresent Administrkfion The a"10"8 oin.ers' 01 senator (J MaRank
Raker
Ore
with common
oi me prpent AamimstraTion. ine honey and Senator Clark and
both Banks on March 4.
It re¬ Bank of Flemington, N. J., and Bank,
uaKcr,
ore.,
wiincommon
Administration has
warned
reCongressman Reuss uH u
quires approval by the New York the
Union
National
Bank
of stock ol $50,000, into The First naatedlv that restraint, is essential congressman iteuss wnil serve as
State Superintendent of Banks.
l?
*
a valuable focus. Desirable proFrenchtown,
N.
J.,
have
an¬ National Bank of Oregon, Port- Ff
in /
of

Company

Trust

&

Undivided

Guaranty
New York,

discounts 107,733,487

114,182,254

4,193,899

3,899,308

profits

Morgan

called

be

to

Loans

institution

Co., with the resultant

_

issuea
certificate was
Was
issued
was
l&suea
and making effective,

"Viereer
Merger
Merger

ceruncate
ceiimcaie

approving

r-lose

the

of

nnw

vention is

March

lousiness

of

serve

as

.

ft

ft

ft

nounced

Romnes

has been

ft

&

wage and price-making.
The
last Economic Report ot the Pres-

land, Portland, Ore., with common
stock of $20,000,000. The merger

plans to merge.

elected
Director of Chemical Corn Ex¬
I.

H.

ft

ident

was
effected, under the charter
capital stock of and title of The First National
The Bridgeville
National Bank, Bank of Oregon, Portland.
Bridgeville, Penn., was increased
from $400,000 to $450,000 by a
vacancy caused by the death of
stock dividend, and from $450,000
Arthur B. Goetze.
to $500,000
by the sale of new
Mr. Helm also announced the
stock, effective March 19. (Num¬
appointment of Harry E. Wilson ber of shares
outstanding—50,000
to its 30 Broad Street Advisory
A major public offering of steel
shares, par value $10).
Board on March 26.
company
securities
took
place
ft
ft
o
c
©
o
yesterday (April 1) with the unThe
Towson
National
Bank, derwriting of $75,000,000 Armco
THE BANK OF NEW YORK
Towson, Md., with common stock Steel Corp. 25-year 4.35% sinking
Mar. 31. '53 Dec. 31, '58
of $300,000, was merged with and fund debentures due 1984 by a
Total resources—__ 547.671,606 620,358,278
into Mercantile-Safe Deposit and group headed by Smith, Barney
Deposits
474,846,489 543,484,450
Trust Company, Baltimore, Md., & Co.
The debentures were ofCash and due from
under the charter and
title of fered at 100% plus accrued inbanks
146,828,321 210,814,151
U. 8. Government
Mercantile-Safe Deposit and Trust terest.
security holdings
97,595,784 95,537,635
Company, effective as ,o£ the close
Loans & discounts 257,143,620 266,953,078
The sinking-fund of .the debena

Bank, New York, it was
announced by Harold H. Helm,
Chairman.
Mr. Romnes fills the
change

The

gorical

common

,

$75,000,000 Armco
_

.

Undivided profits—
ft

The

6,224,258

6,460,219

-V;:

ft

ft

Hanover Bank,

■/.'

i

.

// !.-•'(

New York

the
appointment of
George W. Dennis as Auditor.
announced

ft

ft

of business March 6.

ft

ft

>

Granite

•

COMPANY, NEW YORK
Mar.

31, '59 Dec. 31, '58
$

Total

$

324,653,433 661,517,481

resources

National

City,

Granite

City,

of

111.,

to

a

new

ft

of

than

less
.

,

.

S.

166,297,377 196,868,977

The

the

recent

fault,

statement

a

of

worthless.) The find-

there might be tripartite committees representing labor management

and

the

decentralized

public

to deal

fashion

with

in
the

application of the standards to
particular industries.
If a new
collective

required
none

bargaining
price

no

,

agreement
and

increase

occurred, there would be

actiS„. Were'udaS

Ben^W. Lewis

no

S

that

jic opinion. However, we should
have in mind that acceptance of
rroncooperation is discrimination
against the

ot policy.

4.35%

We

These admonitions reflect

pnly. selves
Yie appalling tendency of our time wages

.

man

should

who cooperates,

also

remind

our-

that the constant chase of
by prices and prices by

wages,which is our present situ ation, is calculated to keep labormanagement
negotiations in a
^tate of turmoil. The overall ob-

capital

common

Government

of

jng should be after full hearings
and discussion.
Perhaps, then,

Armco will apply net proceeds
stock of frorh the sale of the debentures, for wordsto beeomenota portent
First
National
Bank
in
Great together with other funds, toward 2
action but a substitute; jor it.
security holdings 132,738,414 125,459,391
Bend, Kansas, was increased from the cost
Loans & discounts 281,225,578 294,911,891
additions, improve- ?° ." one ays for mfective action^^
Undivided profits—
13,278,890
12,722,525 $150,000 to
$220,000 by a stock ments and replacements.
instead of futile admonnjon; the
ft
ft
ft
dividend, and from $220,000 to
Appliration will be made to list
$250,000
by the sale of new stock, the debentures on the New York
George B. De Luca,
former
effective March 18. (Number of
?bruptly and inescapably to the
Stock Exchange.
Lieutenant-Governor of New York
issue of controls.
shares outstanding—25,000 shares,
t'
:
State, has joined the Commercial
Lett me suggest, as ;*w"e 'enter
par value $10.)
Bank
of
North
hanks

U.

lack

other

no

has said in his wise and amqsihg-,^id so, it would come before this
testimony, these unsufugtured ad- .committee for investigation and
monitions have a perfect record of finding of fact. Certainly in the
accomplishing nothing. One can- beginning the sanctions for nonn0^ imagine that the! econpmistsr^ compliance should be mild* aind
serving the President belieye such wjth reliance on the force of pub-

ft

v

Cash and due from

had

render them

a final principal payment of
$3,750,000, will retire all of the
issue" by maturity. The debentures
also are optionally redeemable by
the company in whole or part at warnings will work, and one wonany time, except that they
are Jjf:r? " "\eY really wish to stake
not so redeemable prior to April 1, j£eir professional reputations on.
1964 from funds borrowed at an *he success of such a feeble course •

bank.
Karandjeff is President
and A. R. Koerper is Cashier. The
bank has a capital of $150,000 and interest cost
a surplus of $150,000.
annually.
open

total

framework

a

(If

prices.

what is expected is sufficient to

essential if reasonable stabil-

tastic. As Professor

in 1963 and,

commence

It
Self-discipline add restraint

iwcujtably inflationary.

,.

with

,

Harold F.

551,110,900 584,406,945

Deposits

Bank

received permission from the of¬
fice of the
Comptroller of the

Currency

THE MARINE MIDLAND TRUST

,

/•''

ft

ft

American

tures will

stable

the

1S
°, ^.e.rea
within the framework of free competitive institutions. . .
(Italics
added.) Apart, perhaps, from its
tendency to single out wages for
special attention, the only difference. one need have with the Administration is its belief that the,
problem can be solved by such*
warnings. This, of course, is fan-,

,

afforded within

0f

tivity performance of the economy
adds,

—

he

admonitions

are

...

to the Wage advances that can

as

money wages and other"compensation not.justified bythe pfoddcai'e

Steel Debs. Offered

Cedure will, I think, involve some
k|nd 0f official finding each year

remarkably catelanguage,
Increases in
in

says,

hwerAdminiltratfon brings^one iumbfate^rteTinfla'tff1To'take
tM^facto/out o^ndustrill ret1

tions
uuiib would,
vy vUiUj in
in turn,
lux iij .^,1
greatly
cdllj' simMm*"

,

(

America,

York City, as

ft

a

2 by Jacob

Leichtman, President, and Board
Chairman D. Mallary Stephens.
ft

ft

Vice-President, it

announced April

was

New

ft

-

ft

By

Barireh School

ft

mon

National

Bank

Junction

City,

of

Jones

appointment
as

of Ford H.
Vice-President and Trust

Officer of The County Trust Com¬
pany, White Plains,
announced
by
Dr.

Y.,

N.

City,
was
in¬

Kansas,
$100,000 to $200,000,
effective March 17. (Number of
shares outstanding—2,000 shares,
par value
$100.)

was

Joseph
E.
Hughes, Chairman of the bank's
board of directors.

business
Hanover Bank

for

the

and

Trust

Central
Com¬

pany and Irving Trust Company
in New York.
It will be in a

similar capacity that he will be¬

gin

his

new

position

County Trust Company

with
on

The

March

*30.
ft

ft

ft

THE CONNECTICUT BANK AND
TRUST

COMPANY, HARTFORD, CONN,
Mar.

12, '59 Dec. 31, '58
$

379,806,689 416,378,159

Deposits

338,425,160 375,524,646

Cash and due from
banks
u.

8.

National Bank

73.532,017

97,764,195

Government

_

a

o

9




of

Tulsa, Tulsa,

500,000
fective

shares

shares,

common

from

ft

ft

ft

Bank of the Southwest National

Association,

Spectacular

Business

Public

and

its

Admin-

First.

one-

intervention where there is noth-

hour, education TV spectacular on

ing wrong. Apparel prices^ food
prices, many others,i are _not; ad-

'Tnyestment Companies and Mutual Funds," to be shown Monday,
April-13th from 3 to 4 p.m. on
Channel 11.

ministered

Mr.

Estil

Fort

-

National

ft

the

Investment

Com.

..

'

.

V

staff of the

of

name

Associated

Company.

r

Bank,
n,

out-of-town division

.

_

r

Securities

-

'

-

c

man

says,

Richard-w
_

.

Simmer«s

nflrth^rin

3^

^

n/r

■

i

ci^r^io

be»

simple

the
are

'If.youcontrol.^ t e r f e r e with free markets.
Rathe:r they bring the. public mt?rest to bear on what is now pri-

•

its.

.

yate price-tixmg.

oiwT

aim: should,

lt is obvious

S8®?tion over

.

machinery should

and

our

problem

would not arise. Where it
/„„

.

does
...

-

be

restraint, not rigid, price -and
'
e
wage-fixing. We are seeking to p
^ does not anse.
remove the inflationary effect of
Further, those who are , interlarge increases in prices that are ested in price stability should
now at the discretion of steel, macount on conservative opposition
-phinpry, automotive
and
other to these proposals. For they have
.

..

.

_

•

_

-

~

producers in the concentrated in- -a. meaning for progressive .governdustries. And we are seeking to. ment which goes considerably beprevent wage increases, in exces8- ybnd the case for price stability.

..

"V"
«®V6

1

March 24th.

The

.

Scudder,xStevens,&.Clark, passed
away

Second.

of

.

We should beware of

who

J.

guardians

lcte, .^Y111. react.to proposals
} as
by saying^ that they
on ttie free price system.
Therefore, they are inconsistent,
m principle, with the system of
froo markets. I would urge them
to desist. These proposals do not

of

source

more comments.

.

of what can be absorbed from re- Inflation because it is "regressive,
quiring or being the. excuse, for is unpopular. But -it is not with811011 advances- We.can fall far. out conservative appeal. One
• ♦
must be -a ^fairly -imperturbable

-

Richard W.' Simmers

«

William E. Palmer, Vice-Presi¬
dent, has been named to headthe

a

May I offer two

Professional

need for

.

Texas, died March 16.
*

not

no.

School, will conduct the program, * anything, you must control,.everyand Av Wilfred. May of the Com- thing." That wUl be to d9 nothT
mercial &
Financial
Chronicle, ing—which may sometime^ be his
and Dr. Harold S. Oberg, National aim.
"vv,
t
.

Vance, President of

Worth

and

speaking.4

„Dr. Jerome B. Cohen, Professor
of Economics of the Baruch

,

The

There is

inflationary pressure under
circumstances of which-we

,

Association, qf

Sees No Market interference

limited

announces

*•

$

a

of

mrr

ft

This should be

intervention.

a

IX

'

College of the City

common

ft

interven-' agement negotiation.

three of the principles

istration of the

New York

plify and regularize union-man-

Principles Governing Intervention

The Bernard M. Baruch School
of

or

that should govern our pblicy.

Houston, Texas, in¬
panies, will be guests.,
capital stock
:
•"
••
•
from $12,500,000 to
$14,375,000 by
a
stock dividend, and from
Forms
Associated Sees*
$14,375,000 to $15,625,000 by the sale
Mrs. Marguerite W. Bryan is
of new stock, effective March 20.
engaging in. a securities business
(Number of shares outstanding— from
offices^
at
135.. Front
Street,
AT
At»lr
11tr
4li/\
1*1
781,250 shares, par value $20.)
New York City, uiider the firm
creased

Security holdings

77,015,026
88,621,134
Loans & «iisc<mnts_ 161,515,531 164,750 849
Undivided profits
5,547.175
5,376,324

ft

capi¬
$5,250,000 to $5,by a stock dividend, ef¬
March
18.
(Number of
outstanding — 550,000
par value $10.)

stock

$

Total resources

ft

Okla., increased its
tal

For the last 14 years Mr. Jones
has had success in developing new

trust

ft

TV

Junction

creased from

The

upon discussion of "such

tion, two

stock dividend, the com¬
capital stock of The First
a

^

-

an

onset

illusory

increases

clscwncrc

appearance

of

to

brinj

stability.

friend of the strong and the pow^

•

i

.

.

erful to argue for it or to counte-

.

.

The Commercial and Financial Chronicle/

.

But there are many who

it.

nance

Number 5834

189

Volume

unpalatable.

do not find it

if some system of
wage and price restraint is not
available, the case for monetary!
and fiscal remedies for inflation
will seem very strong. Monetary
Moreover,

policy has a strong conservative
appeal. As Professor Heller has
argued, it is a policy that works
against public activities,
espe^
cially state and local construction,
and it works against small

ness.5 For the same reason,

busi¬
it has

banks,

those

appeal

strong

a

to

lend and

to

tight money policy
slight.6
Similarly fiscal policy

is

funds

with

borrowers

to

on

large
whom the effect of

a

very

can

be

a

strong reinforcement to goals and
aims that are quite separate from
the issue of inflation but which
can

be notably advanced by citing

the

danger of inflation. This is
the present tendency. The

now

1(1545)

pany,

Allen

Group Offers
New Mexico Utilily

2,000

shares together with
purchase 6,000 shares
stock, are offered to

warrants to

of

common

rate

purposes,

payment
loan of

of

a

including the
short-term

re¬

Now Fund Distributors

bank

DALLAS, Tex.—The firm name
of Washington
Underwriters, Inc.
has been changed to Fund Dis¬
tributors, Inc. Offices are in tho

$1,000,000.

employees of the company at the
The 1959 series preferred stock
public offering price of $103 per will be redeemable after March
share, plus accrued dividends from 15,
1964,
at
redemption prices
March 15, 1959.
ranging from $105 to $100 per Life of America Building.
Allen & Co. yesterday (April 1)
The common stock subscription
share,
plus
accrued dividends to
headed
an
underwriting
group
warrants, non-detachable and non- the redemption date.
Now Remmele & Co. 1
which
offered
54,000 shares of exercisable until Oct.
Public Service Co. of New Mex¬
1, 1959 and
Public Service Co. of New Mexico
GRANVILLE, Ohio — The firm
expiring July 1, 1963, entitle the ico is engaged principally in the
5.25% cumulative preferred stock holder of each share of the
name
of Remmele
Johannes &
pre¬ generation, purchase, distribution
($100 par value), 1959 series, with ferred stock to
purchase three (3) and sale of electricity and in sup¬ Co., 118 East Broadway, has been
attached common stock subscrip¬ shares of
common
stock of the plying various communities with
change to Remmele & Co.
tion warrants, entitling the hold¬
company at $31.25 per share from water, wholly within the State of
ers to purchase an aggregate 162,Oct. 1, 1959 to June 30, 1961, and New Mexico. Total
population
of
David Barnes Co. Opens
000 shares of the company's $5 par
at $33.75 per share thereafter un¬ the area served
by the company
value
common
stock.
The
pre¬ til 2
David Barnes & Co., Inc. has
p.m. (EST) on July 1, 1963.,
with eleetrictiy is
estimated
at
ferred stock was priced at $103
been formed with offices at 40
Net proceeds from the sale of more than 315,000.
"
per share, plus accrued dividends
For the year 1958, the company
the new preferred stock, together
Exchange Place, New York City
from March 15, 1959.
with other funds, will be used by had total operating revenues of
tcf engage in a securities business.
Of the 54,000 shares of the 1959
the company to finance its con¬ $14,517,176 and net income of $2,series preferred stock with war¬ struction program until the latter 855,688, equal after preferred divi¬ David Barnes is a principal of the

5.25% Pfd. Slock

-

rants

part of 1959, and for other corpo¬

being offered by the com¬

dends, to $1.39

per common

firm.

share.

price of more spending on educa^
tion, health, defense, foreign aid,
conservation is

or

The

inflation.

more

who opposes the expan¬

man

improvement in these ac¬
is
the defender of the
dollar. The bogy of inflation has

sion

or

tivities

the

replaced

socialism

of

bogy

the barrier to enlarged and im¬

as

proved public services. And since
inflation

is

clear

a

and

present

40,000,000 More People

danger—a matter of recurring ex¬

perience—and socialism is not, it
is

much more effective bogy.
situation
will
only
be

a

This

changed when we have an effec¬
tive way of dealing with inflation.
Then there can no longer be a

generalized

that

argument

Will Need

Telephone Service

ex¬

panded public activity causes ini la tion. The government can
*

embark

needed

on

»

useful

and

tasks when men and resources are

unemployed and available. The
imperatives of budget balancing
will take over only at full em¬

which

ployment

should take

when

is

they

over.

5 W.
W.
Heller,
CED's
"Stabilizing
Budget Policy After Ten Years", Ameri¬
Economic Review, September, 1957.

can
"

6 J.

K.

"Market ^Structures

Galbraith,

and Stabilization Policy", Review of Eco¬

nomics and Statistics, May,

1957.

Good and abundant

^

Walston Elects

is

Three Asst. V.-Ps.
V. C. Walston,

prosperity and defense of the country.

President of the
Walston

of

firm

investment

telephone service

indispensable part of the progress,

an

As

&

Co., Inc., has announced the elec¬
tion of Emmett H. Eaton, Carl R.

the

population

grows

and

grows

(it will be increased by 40,000,000 by

Walston and Thomas L. Wilkerson

Assistant

as

of

Vice-Presidents

\

the firm.
Mr. Eaton,

who joined Walston

1970)

& Co., Inc. as of April 1, will be
in charge of corporate relations
and new business operations for
the

organization.

associated
firms

with

has

He

St.

during the past 12 years
recently was associated

and most
with

the

New

change.

York

head

As

Ex¬

Stock

and

Walston, presently engaged
office promotion and
managemnt, has been associated
with the firm in various capacities
since 1954, assuming his present
position in 1957 following service
with the Armed Forces.

in

1957

and

is

joined
Manager

Walston
of the

no

that the
is

years

He

for

was

associated with

banking

houses

in

City,

and Chicago, 111.
joining Walston.
*

prior
-

,5

Walston & Co., Inc., with head¬
at 74 Wall Street,' New

quarters

York City, is one of the

major

brokerage

a

firms

offices coast to coast and

country's
with

64

customer!
born

every

day in the XJ. S.

tendency to think

approval of adequate earnings

regulating telephone expansion and em¬
company

and that it should be resisted automati¬

ployment down.

Telephone

cally, regardless of the need.

users

benefit by sharing the

economies and efficiencies that

Actually it benefits
user, your

you as a

community, and

telephone

your

state.

investment

Kansas

Missouri
to

several

new

other way.

wholly in the interest of the

Underwriting and Syndicate De¬
partment.

earnings to provide the service

Sometimes there is

branch

Wilkerson

new

Over 11,000 babies are

throughout

Carl

Mr.

require large amounts of

compete for the investor's dollars.

There is

the country.

in

more

needed.

be

capital and the telephone business must
have good

Ex¬

of the

change's Promotion Division, Mr.
Eaton implemented the broadening

membership program

This will

and

more

service will

been

Wall

various

dear that

it is

communication

The

gain is not only in direct telephone

jobs and

wages

encourage

You

but in helping each state

and attract other businesses.

cannot

keep prosperity

up

while

come

being able to plan and build ahead.
A

repressive policy

on company

by limiting research,
term

progress

Planning

has

been

formed

202

West

tably to

poorer

service at

than you /would otherwise

a

40th

City, to
business.

offices

at

Street, New York
engage in
a
securities
•

'

»*'




Bell

and long-

higher price

have to

overseas.

Corporation

with

earnings,

Economies, would lead almost inevi¬

Form Bonded Planning
Bonded

from

Telephone System

pay.

The Commercial and Financial Chronicle

.

Thursday, April ?, 1959

.

.

(1546)

K

prosecutions in

number of

Canada, plays a very large part
indeed in maintaining a competi¬
tive economy in Canada.
Now in addition to the compari¬
which can be made between

sons

the positive aspects

of our legisla¬

quite frequently
suggestions
as
to changes are
made which, so far as I can judge,
are often also remarkably similar,
as between our two countries.
It
is
probably desirable that we
tion

and

yours,

fjhould look at these
time

to

in

time,

the

order to assess

of

efficacy
legislation.

is

of

system

our

criticism

One

well from

as

effect

the

to

conflict with Canadian

far as Canada is

as

plaint was filed on Nov. 24, 1958,
in New York City against General
Electric Company, Westinghouse
Electric Corporation and the N. V.
Philips Company, charging a vio¬
lation of Section 1 of the Sher¬
Anti-Trust Act

man

instructions
dian

anti-trust laws is in derogation

will have appreciated from what,
I have said, I do not put the issue
upon the restricted and somewhat
inconstant basis' of international-

to

do

something

which is not in accord I law.

Canadian

with

business

or

of

the established principles of publie international law. But as you

directors of Cana-

to

companies

in Canada

seeking

and

laws and/

policy; and thirdly, that the
only way effect could be given
to such a
decree is if American
directors of U. S. companies give
or

concerned, is that in which a com¬

Application of Anti-Trust Laws of
D.S.A. on Canada and Abroad
small

head,

to a

ter

20

Continued from page

com-

Even

it

were

out

turn

to

that, in coming to bear

per-

unon

mercial

valid extensive relief. If my paper is
defense to show affirmatively that to be at all responsive to the in¬
the
merger
was
necessary
to vitation for it, and to be at all
achieve economies of production meaningful, it is necessary that I
make some reference to this case.
or distribution which could not be
achieved otherwise and which are
In
doing sor let me make it
likely to benefit the public; that abundantly clear that I am not
a
substantial degree of competi¬ discussing any aspect of it which
tion remains in the trade or in¬ is before the courts; it is the pol¬

policy but is dictated by sons within the United States in
American policy.
Nothing-could order to bring about these results
more clearly illustrate the .objecoutside
the
United
States,
the!
tionably extra-territorial effect of ^anti-trust cases could be supported

dustry, and that, on balance, the
merger is unlikely to operate to
the actual detriment of the public;

icy of the complaint in seeking to
reach into the domestic commer¬

But I

cial

affairs

alternatively to show that, by
reason of its financial
position or

with

which

and my
remarks have nothing to do with

otherwise, one of the merging
is unlikely to be able to
the merger

the

it

should

be

allowed

as

a

or

of

in

which

firms

plaint should

remain in business if

it is before the courts.

is

v

Quotes

Our Department of

Justice

■.

These

they

country

the

upon some theory or view of pub-lie international law, that never-.

v

/

serious

are

-theless, would

* /./A "

t

solution to

com¬

us,:

regard as ' relating to bur
ownSovereignty.' These cases involve
on the part of the United States

Consider first the comments

made by your Department-of Just-ice itself in its press-release at

be dealt with once

strikes

it

as

be put in this way: That these
cases
reach into affairs that
we

yob exthe context of the?

in

not be a practicalpractical problem,
r

can

accurate when

are

facts.

a

allegations.The'situation

v

satisfied you will agree

am

amine them

take issue,

I

manner

another

.

the action taken.

interference,

more

and

apparent

the time of the filing of the com-

assertion

plaint.

in commercial projects in Canada

'

prevented.

of

right

a

interfere,

to

The complaint alleges that the
"The complaint," to qubte di- .than is fitting or acceptable bewill not think
that
our
legislation forbidding
defendants, operating through Ca¬ rectly from the press * release, tween two friendly but independthat in persuming to
give
this
combines -is
so
nadian
all-embracing,
subsidiaries, engaged with "also charges that United States, ent countries/'
somewhat
rambling
sketch
of other
especially as interpreted by the
co-conspirators,
most
of manufacturers, who would .nor-/ J '
courts,
that
many
cooperative aspects of government policy to¬ them Canadian companies, in an mally have exported such apparaRefers to Other Cases
ward restrictive practices in our
unlawful conspiracy in restraint tus for the expanding Canadian
practices which in fact are not
countries
and
some
other of
J f am not going to refer at length
harmful
but
would
indeed
be two
foreign trade and commerce be¬ maiket, weie compelled .instead or
in much specific detail to other
beneficial to the public interest, countries, I have been carrying tween the United States and Can¬ to manufacture such apparatus in.
bases which were interpreted in
coals to Newcastle.
Perhaps, by ada in radio and television re¬
are not followed because business¬
Canada.
This is clear proof that
Canada as involving undue interthe way, it is time we got rid of
men fear they would be subject
ceiving sets. Such restraint, it is the situation complained of was
ference.
One
or
more
of these
to criminal prosecution and con¬ that old cliche and invented some alleged was accomplished by the the result of actions in
Canada, caSeS have involved
attempts to
viction if they were party to any new ones of our own, such as organization of a Canadian patent was in the interests of Canada and
require the Canadian records of
such arrangement. Exchanges of carrying oil to Texas or gas to
pool, controlled by the defendants' in
The .reason,
°fV/'1
^^ia<^1.an ■)Canadian companies, being subhowever, •Canadian
statistics and agreement on prod¬ Alberta.
subsidiaries, which pre¬ and that the real objection is that
0f united States parent
uct standards and specifications that I devoted some time to the vented the importation into Can¬ it is
contrary to United States inNow I hope you

i

anti-trust

given as examples.
Actually
no
prosecution

are

of

launched

been

ever

has

the

on

basis

participation in such arrange¬
alone.

ments

But

since

it is

un¬

is

anti-combines

or

sys¬

respective countries,
that I wished very sincerely to

tems

of

our

get my following remarks in

their

perspective.

proper

Share

Same Sentiments

,

and

care

adopted in respect of what I may
call the peripheral areas.
One possible approach might
be,

highest possible stand¬
living and the greatest

afford the
of

ards

degree of individual economic

and

freedom.,. Y0u wish to
as many Centers of indir
initiative as possible. You

political

while preserving in full force and
effect the per se rule against the

maintain

price fixing and related

vidual

type of

combine—what I might /call the believe that the anti-trust laws
obviously detrimental combine— are an important instrument in
yet to provide that :a defense can maintaining this kind of a system.
be raised to

charges jn other

areas.

Thus if it is charged that a com¬
bine exists, not relating to price

fixing, etc., it might be made
sible

to

pos¬

defend

by proving that
actually taken or
contemplated — for instance, with
relation to setting product stand¬
ards—were not in fact contrary to
the public interest.
the

measures

Another

suggestion

which

we

television

that

upon

a

course

embarked

Those

are

our

sentiments also.

differ to a considerable
degree in methods and as to the
implications we read into particu¬
lar trade and industry situations
We

may

on the whole, we have set
ourselves the same general objec¬

but,

tive

of the maintenance of a free

United States.

Patent

a

I criticize them because I feel that

result

criminal prosecution and convic¬
tion. Thus it is argued that amal¬

regard must be had for the feel¬

gamations

friends and neighbors.

arrived at
voluntarily, which produce bene¬
ficial

results

technical

in

a^e

terms

efficiency

cheaper production and

competitive position,

of

greater

and
a

thus

sounder

may yet re¬

sult in

ings,

rights

Now

it

is

and

objections

accepted,

that in certain

cases

of

,

of

course,

the courts of

country will direct decrees to
persons
within their territorial
jurisdiction which will have ef¬
one

a

greater
legislation for

precision

in

the

the
guidance of
both business and the courts.
We
might consider whether, while not

relaxing the stringency of the

pro¬

visions and penalties
against those

types of practice which
face of them anti-social

jurisdic¬
Nevertheless, the degree to
which, and the purposes for which,
the extra-territorial application of
the anti-trust laws has for some
tion.

Here again there
may be room

for

are on
or

self-aggrandizing in their

motiva¬

tion, there could be greater cer¬
tainty as to what types of activity
in the peripheral areas are or
are
not permitted.
Thus study could
be given to the question of whether




time

now

been

asserted, is
ing serious misgivings in a

has

from

to

time

time

to

be

removed

brought

and

from

the

into

United States for purposes of antitrust suits relating to the activities

express

and distribution in Canada

the

been

subject of attention from both the
Canadian

Combines

Branch

and

ber

of

num¬

countries

friendly to the
United States, including Canada.
Cites Recent G.E., Westinghouse
And N. V. Philips Case
This

misgiving is renewed from

far

possible be worked

as

out .'penalty

directors

to

Canada, United States.

m

without undue delay.

.

with-

the

in

...

,,

has been

Victor

\r. T

this surveillance, CRPL has never
been

A

our

with an offense
Anti-Combines Legis¬

thing which
to

well be contrary

may

the intent

Canadian

of

tracts

law.

V'
Reveals

;

Real

rt

Issue

be

directed

of

United

States

merely

as

States

parent

trade

and

tries
are

in

which

such

incorporated

not

which

and

is

dictation

-

<

AT

-.'A

thl^

'is

^anariian'

in

to

of

development
the

th'at

vv,0„.

company.-

.

«

rather

foira

con-

Government

than

sub-

Canadian

of

this

difficult

your

tion

in

of

Chairman

subsidiary

the

your

the

anti-trust

suit.

In

a

tt

other

WOrds, this argument runs, if the
--

United
<fPnrP

Canada.

L

States
to

does

keen

anti-trust

not

certain

choose

to

effects

of

laws in, it is

quite

dpen to other countries to fence',
.*
:
the -. r i
_f th„ time of the at-

remarks «to
^eepsuch effects out.

to

of

Cana--.^

^

Canadian-rw.imentc

General

+VA

following is

control to regulate

™n complete

reaction

press

Electric,

of

examble'

business, reacr

are

the

by

for

sets

*£ - «£ ™

in

of the Board

dian General

on

the

two countries in radio

in Canada have it within out

it as

understand

Canada

attributed

The

■

and unfavorable

Illustrative

our

tPWi«rion

Ibe.'KfCrXtaw
antitrust

background,
to

tween

allege*-'*

that has been aroused

of

out

between

.department and the

a

•,

concern

coun¬

carry

follow

to

only

not

Against

subsidiaries

and

^directors to

mitr

nnf

y

thereby subject to United States
policies in priority to the laws,
customs and interests of the

Arising
tracts

affecti«S international trade be-

policy

enforcement

and

commerce

courts
directions

not one o£ ordi-

was

assign to the Government derights over inventions

partment

we

companies
of United

projections

to

to

your

of:

way

States

~

the

under

which the company was obligated

* way vih

given

e

stance is at issue; that in the cases

illustrate

subsidiaries

in

g

department of

a

"Government

American

which

trust, for United States authorities
foreign

by

be

hUfwwslWv Cf0omranraCitLinnitenf
?aw Pas
l
the
sancUoh ?o

tendency, apparent in the field
of foreign affairs as well as anti¬
regard

9

S?pLbtUpdntvraaSdemtionUo?

a

to

only

directors

nr!rUvnnr
contrary

governed
including the
anti-combines legislation and the
patent legislation.
to

be

Canadian

laws

appear

the

could

United

policy which

commerce

cases

that

effect

would
from

against arrangements

Canadian

clear

is

successful outcome

entered into by Canadian compa¬
nies in Canada which are matters

by'Canadian

And ,_fin ally, as I have indicated,-

which

with

Canadian

lation.

imiti

h^ra^rii,n

i

companies in Canada to do some-"

charged

against

-+^

Electric
c.

at?

of

Canacuan documents of Canadian
companies

resident

m

Ontario to

one^ofthe mUdm:

business.
Our

specific

objections

to

an

action such as this are threefold:
That it is concerned not so much

with strict compliance with United
States laws in the United States
as

it is concerned with actions in

Canada

of

Canadian

which actions

in

companies
accord

with
com¬

ing

with the decree

articulate
and
public. The
latest case which brings the mat¬

commercial scale

ex|ra-U^9ia

Canadian laws and Canadian

to

so

a

takenr„^^^ir^^e

time by particular
cases,
and the complaint is now becom¬

time

shall
on

These, pro--..
the Tariff Board and as a result visions
have, of course, been
of such attention has from time to into consideration
by the Canadian
case
time modified its policies in the authorities in
appraising ; the be-,
direction of lower royalties and a havior of
CRPL, and it is,
more liberal licensing program. It
ordinary to contemplate that ac-UT
is significant that notwithstanding tion
may be taken here to force

caus¬

the

purely

an

Our

.

Such

a conviction because
of a fects
beyond such jurisdiction, and
lack of clarity as to what
may be will assume jurisdiction in
respect
admitted as argument or
proof in of certain activities
taking place
respect of what is the public in¬
beyond such territorial

terest.

Law.

"patent pool" referred to is provision that it is an abuse of: a'. of Canadian companies,
Radio Patents Limited, patent, on account of which patent
very iong ag0> in the ICI
a
Canadian
oompany
organized rights may be lost, jf the
working
and dup0nt case, a decree waa
about 1926, to which the leading of the invention within Canada
on
secured
by your government in
Canadian manufacturers, and one a commercial scale is being preyour courts of such an extraordiore more other holders
of Cana¬ vented or hindered
by_ lmporfa- narily extra-territorial effect that
dian patents in this field, have tions from
abroad, and alsQ .anya ,further
application had to beassigned their patent rights for express provision that,, ,for
the^made to a United States court ta
licensing en bloc to firms intend¬ purpose of determining whether
,clarjfy the judgment so as to pering to manufacture in Canada. It there has been an abuse, it
should_ mit. one Canadian company to sell
has been its general policy to re¬ be taken that
patents are.
grated„.;a product made in Canada to an-s
fuse licenses to import, exceptions
not only to encourage,
invention .pther Canadian company for resale
being made in special cases. CRPL but to secure that new inventions

If

business

which

contains

Act

Canada

,

Canadian

The

competitive economy, and we are
beset by much the same problems.

only of honest we are entitled to expect of your
judgment, and not in any country that even in pursuing ob¬
way dictated by greedy or aftti-" jectives which we may agree arise
social motives, may yet result in from the best of
motives, a proper
as

.

^

then, I take advantage of
Needless to say, the real issue
your kind invitation to criticize for us, in an anti-trust case such
certain aspects of the enforcement as this launched in the United
in an action for an: injunction as
of your anti-trust laws, in their
States, is not the merits or defects
an alternative to an action
leading effects upon Canada, it should of the institutions or
arrangements
to prosecution and conviction.
now be clear to you that I do this
in Canada which the case seeks to
There are also complaints that not out of any lack of sympathy
alter. It is rather that in impor¬
the provisions against
mergers are for the basic purpose of such laws. tant aspects such cases
appear to
vague

.

Next—the

Could look at would be to
permit
the issue in such a case to be tried

so

companies,

terests.

re¬

Canadian

You, in the United States of
study America, are interested in main¬
a
free and competitive
would allow to become available, taining
because
you
believe
it may be desirable to see if some economy
alternative
approach
could
be that such an economy is likely to
little

a

radio .and

.

doubtedly not the wish in either
country to have laws which de¬
prive the public of advantages
which

of

ada

ceiving sets manufactured in the

are

mercial

these

policy; that compliance
sought may bring
companies in Canada into

' ■
'■>*■£' Province of Ontario making it an
flagrant dicta- -offense to take documents of
a: blatant Ontario "
companies
out
of
the
to throttle the autonomy of Province for such
purpose.r
.

,

,,

."We

tion

see

it

as

a

by Washington and

move

these Canadian-based

companies.",

pc)ini js giyen to these thoughts
by.the observation from the AntiTrust Bulletin of the Department
of Justice''at Washington for Dec.
York
City Bar Association.. In 22 and 29, 1958, that in the current
that study the view was expressed Standard Oil of New Jersey case,
that the extended extra-territorial a court in your country has afapplication being given to the firmed its power to grant discovNowr

familiar ,;I
know with the recent study by a
special committee
of
the New
you

are

all

Volume

189

Number 5834

The Commercial and Financial Chronicle

.

(1547)

from
foreign
files
despite
prohibitions of foreign laws.
ery

I

.

that,

understand

lation

of

Hirsch & Co. Installs

legist

some

Message Channel

a

response

■

.

,

nications
Wants Less

-

and

speed

between

the

company's

and

to

its

of¬

branch

up

^Each of the 12 lanes

is

colored

for

easy

on

Inv.

by traders, clerks and teletypists,

spot

along

the

the

firm

three

linked

installation

departments of
together by the
the

the over-the-counter
the

and

Investment

tion. of

are

cable

order

the

the

trading desk

ment

This
.{Special to The Financial Chronicle)

Highway

of L. E. Peabody Co.

under

the

the

given

be

in

from

ern

,

limited

be

all costs (in¬
meals, text mate¬

covers

room,

and

Washington office of the IBA„
13th Street, N. W.

With Yates, Heitner

No, the situation is bad enough
but it might be even worse
each country takes ever more
rigid positions, standing fast on
its own legislation and insisting

SPRINGFIELD, Mo.—Gerry Eh
is
now
with
Yates,

Committee

cooperation

of

with

Hannaford & Talbot Adds

by

(Special to The Financial Chronicle)

the

the

Calif.—Charles E. Lan-

NAPA*

tow and Willem Geerts have been

added

to

the

staff

of

Hannaford

University and the Education & Talbot, 3564 Jefferson.

now,

how metals from

it is justified on the basis of strict
legalistic interpretation of inter¬

The

national

law.

sents

undignified international

an

spectacle,

to

discomfort

nothing

say

it

prospect

the

causes

pre¬

of

the

make sweet music for you

di¬

poor

rector.

Surely therefore this is not the

only approach to a solution of the :;
problem. While we in Canada are)

and ...deeply } Concerned

genuinely

lover the threat to

Canadian

Oyer,

U

V

:

and

commerce,

>

;,

sovereignty

our

/while I wish to make it clear that,

the Canadian Government regards,
'

it as

such

the ' aversion

which

;tion

I

the

of

the

.

"/•- ■'}
,

States;.//??;?

direct/and

in-

direct effects of these cases/abroad
and in

•

solu- :
in the; :

realization

authorities

-.

/•//•'.

proper

problem lies
by United

tthe

to

full

that

C

"
know you//;?';

feel to that sort of action;

We. feel

*

*

primary obligation to pre¬
sovereignty, we share

a

serve

„

.

.

.

T

i

restraint in seeking

a

the courts,

applying, measures)

or

//?/?/ ;
//>//?'

that interfere directly substantial?:.-;??

ly

and

deliberately with*; matters;

that are essentially matters of Cat
nadian commerce, withiii

>'"/

Canada?/'>5////;

If United

States authorities enter

tain feelings of concern that prac-;
tices carried on, in fCanada are?

Vuriduly;resfriiijtiye qf.internatiohaj •.

■

•;.

trade/ it

agree that yoil
;
■

to

expect

,rnanper

would?b£.entitled:

.to. act, in

us

.should the;;

arise Jn reverse.//

K'jrT's

,:
\'
?? t tyy.
..

t' at;' this] / •"

would, appear

/?£*%

similar;;

a

qrobleni;

ever/;

"/////?

/I?) i<-rV/v

'

?r.V vi /?'??V;/>?:' /;?? •!r.;'i*v'..*'■

'

?£••/

Offcrs/S^ple/Solutibn

Perhaps I /night
fore, by 'raying, what I /tm
■ •/
lp\vycr$, will ?agree with,. indeed) ??'/:?/''•
practicing lawyers^ jareyprobablyfJ
?
iKe first to realize the truth ol the''*;'

,/

'

/propositionvx, That) is:
/, every-problem/is-

ati^nqt; ?/•;'{>;,4

T

cap.{b/e of 'Saiis-;/:'

-

'*•_ factory ' solutions b>'JpCrig|^/iiiT):?'/'.-A?
"

sistdnce

on

the

application

preconceived formulae..
Jarly is this true in
international
volved

and

in

Particu-?) // ?/

cases

relations

where.*??.;?,/
;
ifr-/ ^ v'

'"are

situations

actions at home

are

where

True, vibrant tone of cornets, trumpets, and trombones depends largely on
the inside shape and finish of their tone chambers.
A pioneer in improving tonal quality since 1875, C. G. Conn, Ltd., makes
many of the wind instruments used by professional musicians as well as

bound to have

extra-territorial effects.
*

We

are

therefore encouraged by

■

the readiness of your government'
to discuss the general
problem as

it

is

illustrated
It is

case..

the

our

situation

both sides in

America's thousands of amateur bands and orchestras.
#

is

ALSO ELECTROFORMED with

by

approached

the .realization

are

considerations of comity in them¬
call
for self-imposed
re¬

density throughout—increased
live, powerful tone.

selves

the

extra-territorial

effects

an

agreement

vivendi—based

on

as

to

a

mutual

pro¬

from tube

has

or

sheet.

Other industries

depend

on

cately shaped precision parts,
interior complexity.
"Plus-4" Anodes, one of

of

actions under anti-trust legislation
may yield to a solution—perhaps,
even

resonance

duces

straint, then this difficult problem
of

"Plus-4" Anodes
the bells of Conn instruments. This seamless

unit-method of construction gives still further
control of entire tone chamber. Bells have same

that >

that better tone results when

found

mouthpipes (or tone
chambers) are made of copper—built up electrolytically on removable precision
forms, using "Plus-4"® Phosphorized Copper Anodes.^ Mouthpipes produced
this way have consistent dimensional accuracy to millionths of an inch—and
without the further finishing required when these particular parts were shaped
Conn

the current
hope that if in facb
by

*

demonstrate

modus

"Plus-4" Anodes for the production of intri¬
them microwave components of extreme

among

•

research is always striving for in the whole

nonferrous metal field: New ways to

under¬

standing and respect.

,

developments Anaconda has pioneered,

many

what Anaconda

do things better—more value for less

money—in home and industry.

59172 b

•

Three With Midland
"

'Special to The Financial Chronicle)

:

CUT-AWAY VIEW

COLUMBUS, Ohio—William

O.

Carter, Jr., Russell G. Dawley and
William A. O'Harra are
Midland
Investors
Co.,
Gay Street.
'

now




52

with

East

finish"

of tone chamber shows "microAnother cost and

of interior surface.

quality advantage: by acid-copper electrodeposition, both chamber and mouthpipe are
made as a single part. They were formerly made
as two pieces of sheet metal

^nd soldered together.

AnacondA'
PRODUCERS OF: COPPER
GOLD

•

PLATINUM

URANIUM

•

»>-

Anderson

Rigid Position

if

to

(Special to The Financial Chronicle)

classroom

sponsored

School of Business of Northwest¬

firm

will

Heitner & Woods, 427 St. Louis St.

is

course

Education

IBA

the Con¬

name

to

concentrated

training

CONCORD, Mass. — Harry J.
Cassidy is conducting a securities
cord

the
425

Fundamentals of Invest¬

Banking

Aug. 9 to Sept. 4.

In Securities Business
'

on

by

Associa¬

America witli Northwest¬

course on

States

notebooks).
Applications should be made to

ar¬

made

Bankers

rials

registrations

desk.

business from offices

been

struction,

University to extend to May 1
time for the acceptance of
for the summer

ern

new

room,

have

Central

Tuition is $475 for each regis-**

trant, which

Announcement is made that

veyor.

The

50.

Banking Course

rangements

con¬

the

Enrollment

Extended for IBA

the belt

of

Group of the IBA.

identification

and messages placed in a particu¬
lar channel are directed to a pre-

designated

Committee

Registration Time

execution
orders received by the firm.

of

"fencing out" natures
to this sort of thing
Aluminum, in a new guise, has
was
passed not long ago by The
come to Wall Street.
Netherlands.
Perhaps also some.,
Hirsch & Co., members of the
such course could be followed in
New
York Stock Exchange and
connection with our problem. But
other principal securities and
it would
seem
to
create
almost,
commodities exchanges, has
as many difficulties in other fields
placed in operation a 60 foot, 12
as it would cure in the particular«
lane, extruded aluminum message
field.
J", :
?;
channeling belt in its headquar¬
; To mention only one complica¬
ters
at 25 Broad Street,
it has
tion, w at for instance of the in¬
been
announced
by- Howard C.
creasingly lugubrious position of
Hirsch,
senior partner of the 48the poor director? Increasingly he
year-bld investment firm.
•
wculd be stretched and shackled, )
Said to be the longest alumi¬
as it were, over the international
num
conveyor in use in the bro¬
boundary, with Washington put-'
ting lighted splinters" under his kerage field, the belt runs at a
toenails and Ottawa tearing off speed of 285 feet per minute and
was designed to expedite commu¬
his fingernails, ?/;
y •
~
v
in

headquarters
fices

27

PALLADIUM

OXIDE

•

ZINC

•

•

LEAD

•

CADMIUM

MANGANESE

•

•

.

ALUMINUM

•

SILVER

SELENIUM • TELLURIUM

ARSENIC • 8ISMUTH

•

INDIUM.

_

*

1

88

The Commercial and Financial Chronicle

(1548)

Thursday,"April 2, 1959

"v

Continued from

Public

Utility Securities
for

that

area

undreamed

British Columbia Power Corp.,

Ltd.

to

controlling British Columbia Electric (the principal subsidiary)
The system supplies electricity and gas to the
cities of Vancouver and Victoria and 67 other municipalities in

end other utilities.

operates railway and transit lines in
leading municipalities and in lower British Columbia. The popu¬
lation served approaches one million. Total revenues in 1958 were
$83 million, derived as follows: electricity 64%, gas 12%, pas¬
senger transport 17%, rail freight 6%, miscellaneous 1%.
British

Columiba.

also

It

enjoyed extremely rapid growth so far as elec¬
Following is the revenue
the past decade:

BC Power has

tric and gas operations are concerned.

comparison

over

*

-Millions

Electric- -Other

-

grain.

petroleum
refining well - estab¬
lished in Canada coupled with a

crude

relatively large and fast-growing
population, it is not surprising to

physical

find

is used

110%

The decline last year was
increase was about
a

com¬

share by claiming as a

the balance of pension

costs, in¬

petrochemicals
in

Canada.

Amount Accrued
in 1958

Accrue in 1959

$5.1

$2.4

$2.7

1.7

Balance to

.3

1.4

.1

.1

.3

.3

$2.7
which

accrue

about the future development of additional
hydro facili¬
ties in British Columbia. While there are substanthial
amounts of
Fraser

and

Columbia

upper

Rivers,

the former is not now available because of
its salmon runs and the
latter because it is involved in
negotiations with the United tSates,
which takes a great deal of
power from the lower river.
Peace
River, however, does not have such complications and the Peace
River Power Development Co. has been
formed

Gren

by the Wenner-

interests, with BC Power participating through

The results of

an

initial survey are

end of this year.

formerly considered a "growth
S. utilities, and sold at corre¬

44-37/ and this

41%-37.

Tiie stock

pays

It

up

to

55%

on

sells

$1.40 and at the
at

about

20

year

has been

recent

price here of 39%
times 1958 earnings, but with

earnings adjusted to include the balance of rate
increases (about
50c) the stock would be selling at only 16.1 times
earnings, com¬
bed
with a general U. S. average around 18 and a range of about
22-26 for U. S. growth
utilities. Of course/there is some doubt
regarding the rate increase until the court
proceedings are ended
but m any event economic
conditions in BC should improve this
year, and the company should realize more
adequate earnings from
the investment of
equity funds raised in 1958.

Harwyn Securities Formed
ELMONT, N. Y.—Harry Weintraub

is engaging in a securities
business from offices at 120 North
King Street under the firm name

•of

Harwyn Securities Co.

Forms Milton Inv. Co.'
WEST
Milton

ENGLEWOOD, N.

Cohen

is

J.—

engaging

in a
securities business from offices at
194 The Plaza
under
the firm
«iame of

the

Milton Investment Co.




world-wide

an

Aromatics^

6.5

-

Inorganics

v

industrial solvent, it

With A. C. Karr Co.
(Special to The Financial Chronicle)

LOS

ANGELES, Calif.—John C.

Daniels is
Karr

now

of

thousand

several

now

there

are

chemicals

nylon.

An

18

recent

.

the

years

average

price/pound of the aliphatics was

alternate

hy-

natural

production

gas

re¬

are

quired for this fast-growing seg¬
industry.
During the 1957-1958 recession

ment of the chemical

were

rumblings
possible

vague

and

dustry in the future.
established

of
re¬

fact

It is

that

a

the

well-

petro¬

a
whole.
Nevertheless, with the
continuing support of the strong
research and development arm of
the industry coupled with intelli¬
gent and aggressive leadership the
industry will continue to prosper.

The

principal hydrocarbon types
contribute directly to the
synthesis of petrochemicals are
known

as paraffins, olefins, naphthenes, and aromatics.
Methane
(CH4) is an excellent example of
a paraffin.
It is the major ingredi¬
ent in natural gas which ordinar¬
ily will contain 90-95% methane.
It is used to make many chemicals
including ammonia and methanol.

Before methane

and

Year

Smith, Barney & Co., New York
City, passed away March 24th.

Two

benzene

outlets

large

are

new

legion.

are

In either

ber.

It is believed that the investment
in

the benzene is

case

was

a

new

facilities for the? chemical

side of.the petroleum- industry ex¬

first reacted with

ceeded that for

petroleum refining those for
refining:, again this year.
It is
further expected that the former '
will also exceed the latter each
last year, and will exceed

year"thereafter.''

•1

expenditures for
refining and - petro¬
solely on the domestic petroleum petroleum
refining and petrochemical indus¬ chemical plants are shown in
tries. A study of the world-wide Table III for 1955-1957 and esti-'
picture is outside the scope of the mated for 1958 and the next five
years. Hi 1960 it is expected that
present report.
the annual rate" of capital spend¬
Size of the Industry
ing for new equipment and plants
In Tables I and II statistics re¬
in petroleum refining wilL be ap->
lating to the magnitude of the
proximately $0.7 billion and will
petrochemical industry relative to increase almost to
$1.0 billion an¬
the whole chemical industry are
nually by 1963. Today capital ex¬
presented. In the former a com¬
penditures for new petrochemical
parison is made on a production
plants are believed to be greater
basis and in the latter on a sales
than for oil refining; however, the:
basis. Last year total petrochemi¬
annual rate of spending for new
cal production was estimated to be
plants in the field of petrochem¬
about 40 billion pounds. This year
icals in the next five years is ex¬
petrochemical production is ex¬
pected to far exceed that for new
pected to be close to 43 billion
oil refining plants.
'
•
"
pounds. Petrochemicals will prob¬
ably comprise 29% of the U. S.
Diversity of Ownership
-

The *

capital,
.

chemical production in 1959.

Last

Petrochemicals

are

broadly de¬

production of all
fined as those chemicals derived
slightly above 140
from natural gas and petroleum
billion pounds. The value of petro¬
sources.1 Today in the petrochem¬
chemicals was approximately 57%
domestic

year

chemicals

was

ical business one finds companies

of the sales value of all chemicals.

Capital Investment Pace

which not

ago were

so many years

established

in petroleum
chemical manufacture,
The capital investment of the refining,
major fac¬ petrochemical industry in manu- shipping, farm equipment manu¬
facture,
rubber processing, gas
TABLE I
pipe line operation, etc. j

Future Petrochemical

,

and Chemical Production

Petrochemicals

A11 Chemicals

Petrochemicals

Output (Billion Pounds)

Output (Billion Pounds)

% of Total

firmly

Examination of

some

of the his¬

torical

growth figures and profit
margins, and the anticipated
growth patterns makes it easy to

1954

26.5

114.6

23

32

134.8

24

understand the great and continu¬

1956

35

143

25

ing activity in this field.

1957

38

148

26

1958

(esi'd)

40

141

28

1959

(est'd)

43

1963

(est'd)

72

150

•

.

.

*

39

TABLE II
-Billions of DoUars

1954

$3.2

$6.0

52.5

1955

3.7

7.2

51.5

1956

4.2

7.8

55

1957

4.4

8.0

55

1958

4.5

7.9

57

5.2

8.8

59

8.0

12.0

(est'd)
1959 (est'd)
1963 (est'd)
dicted.
will

be

shown for 1958,

1959

and

1963

1 "Petrochemicals

It is expected that by 1963 the
two-thirds that of all chemicals.

dollar

sales

estimated

value

of

and/or

pre¬

petrochemicals
,

Total Chemicals

Petrochemicals

and Allied Products

-BiUions of Dollars-

1955

$0.8

$0.5

1956

0.9

0.7

1.45

1957

0.9

0.9,

1.7

0.7

1.4

0.7

1.3

1959
1963

(est'd)
(est'd)

0.6

(est'd)

1.0

0.6
■

be

defined

as

are

ammonia made from natural

gas

and

synthetic rubber—a mixture of hydro¬
polymers.
Carbon black, essen¬
tially pure carbon, is included in this
carbon

category.
"The
major

petrochemicals

are

am¬

monia,

Comparison of Capital Expenditures

1958

can

compounds made with a petro¬
hydrocarbon as one of their basic

synthetic rubber, carbon black,
ethylene, propylene, butylene, butadiene

TABLE III

Petroleum Refining

the

components. Actually the general under¬
standing goes beyond this to include pur*
hydrocarbons and. other materials derived
wholly or in part from petroleum but not
generally classed as chemicals. Examples

67

have been

^

on

chemical
leum

,

^Figures

information

petrochemical industry — as dis¬
tinguished from the chemical in¬
dustry as a whole—is difficult to
segregate. A comparison can be
shown, however, for the entire in¬
dustry with the natural gas, petro-

29

.

185

.

Statistical

Dollar Value *

-

Livey E. Copple, associated with

of

uses

1955

Co., 3670 Wilshire Blvd.
He was formerly with
Hemphill,
Noyes & Co. and Shearson, Ham-

Livey E. Copple

petrochemical
plants, and
capital •; expenditures for";
in certain "Chemical' and Allied Products." .
new

great extent from petroleum.

a

The

ethylene to form
beingt produced daily which are ethylbenzene.
Upon
subsequent
made partly or wholly from petro¬
dehydrogenation the styrene thus
leum, natural gas, or refinery gas. formed is ready to be converted to
Although today approximately polystyrene for plastics or reacted
28% of all chemicals synthesized with butadiene to form GRS
syn¬
In this country are petrochemicals, thetic rubber.
scarcely 2% of our petroleum and
The following survey is based

affiliated with A. C.

- •

of

route to cyclohexane includes

to

a

chemical

States

&

mill & Co.

synthesis

In

intermediary in the

an

as

plastics and in GRS synthetic rub¬

United

a

the American Exchange and 53 in
Canada, equivalent to 22.5 times
the 1956 earnings. This
proved to be a high-water-mark, however:
the range here in 1958 was about

.

In

subsidiary.
expected to be ready by the

utility" on a par with similar U.
sponding P-E ratios. Thus in 1957 the stock sold

yields 3.6%.

midst

the

revolution.

Past

British Columbia Power has

in

which

months.

concern

the

shadow of doubt

a

are

has enjoyedA a higher
growth rate than the industry as

The company is expected to continue its
rapid growth, although
somewhat of a drag.
There has been some

on

we

tremendous

industry

transit may remain

power

the

on

chemical segment of the chemical

$4.5

should

Based

duced growth in the chemical in¬

Total

$7.2

—that

there

Amount

revenues

well-estab¬

-rich Middle-East oil pool we

over-capacity

in
1959 would be equivalent to
roughly 50c a share. However, the
electric and urban transportation increases
may be effected by
proceedings before the Court of Appeal, the outcome of which

undeveloped

highly
In addition to

processes.

as

47.5 billion .■>.

Aliphatics

$83.3

Freight Revenues

some

by a
developed

33

-Millions of Dollars-

not be known for

recovered

$39.6
$39.6

stead of spreading the amount through the year 1962.
In 1958 the company obtained rate increases as follows:

may

use

of

113

about 11c

increased

its

is

and

.8

10.5%), and somewhat less favorable business conditions. The

of

Yearly

oil

combination

4.9

In 1958, however, they slipped to $1.95.

amount

ali-

.6

due in part to issuance of additional shares (the

The

groups:

2.3

company's earnings record has been quite favorable in
to 1957. Share earnings increased steadily from

Total

three

Today the bulk of the alcohol
phatics, aromatics and inorganics.
prising
frequency
for
Mexico, used by industry is of petroleum In
1963, the estimated production
Venezuela, Argentina and many origin. Cyclohexane (C0HiS) is an of the different classes of com¬
other countries to the south. With
example of a naphthene or cyclo- pounds is listed below:
rich petroleum resources and with
paraffin.
It occurs naturally in
Pounds

have witnessed the growth in re¬
cent years of a petrochemical in¬

share in 1951 to $2.34 in 1956 and in 1957 remained at $2.33.

Urban Transportation
Intcrurban Bus

in

.

15 cents, of aromatics 19 cents, and
drogenation of benzene produced of inorganics: 2.5 cents* In 1958
from coal.
Benzene (CoHc) is the petrochemicals sales are believed
dustry in the Far East, notably first of a whole series of aromatics to have amounted to $4-.5 billion.: In Table III a comparison is pre¬
Japan.
Several
months
ago
a which
were
obtained primarily
great petrochemical project was from coal prior to World War II sented for capital expenditures for
new petroleum refining facilities,
announced for Australia. It is evi¬ but which
today are synthesized

*8

v

recent years up

Electric

classified

.

ordinarily

are

14.0

available.

deduction from taxable income

today
polyethy¬

ethyl alcohol was $9,000,000,000.
largely by fermentation of
Petrochemicals

made

dent—beyond

or

uses

and

ago

15.2

—

$500,000

alcohol

Years

lished

\■

pany saved about

ethyl

are

lene.

and South American countries.

same

Generating capacity has been increased from 352,000 kw. in
peak load increased from
361,000 to 755,000 kw. Capacity has, therefore, barely kept pace
with peak load. Output in 1957 was about as follows: hydro 92%,
Cteam and dicsel 1%, purchased 7%. Production costs were about
es follows per kwh.: hykdro .4 mills, steam 4 mills, diesel 36 mills,
purchased power 5.8 mills.
Similar data for'1958 are not yet

a

Ethylene
example of an olefin.

an

160

1949 to 745,000 at the end of 1958; and

88c

material.

raw

(C-Hi) is

ammonia

the prin¬

174

''Decrease.

The

cipal

of

was

Two of its well-known

Multi-million dollar petrochemical
projects are announced with sur¬

can

synthesis

10.4

-

-

oil

the

methanol, coal

27.8

t

Total

It is close

richest

world's

pools, namely Venezuelan oil. Oil
is also plentiful and relatively in¬
expensive in other Latin Ameri¬

in

tor

and

3.8

-

Miscellaneous

the

the

is

10.7
—

Passenger TransportationRail Freight

263%.

of

one

hitherto

story

the

mere

$25.4

J

—

Increase

scale

a

The

petrochemical
$315 million. .
It is believed to represent 55-60%.i
of the assets of the entire chemi¬
cal
industry.
Since
plant in¬
vestment
in
the
petrochemical
industry has been increasing at a
rapid rate, it is expected that the
capital investment in 1963 will
be
between
$7,000,000,000
and
investment. in

industry Was a

$7.0

Elcetric- -Residential
Gas

Percent

>

1958

1919

on

of.

in Latin America.

same

large Canadian holding company,

a

facturing facilities & presently es¬
timated atr $5 billiou. In 1940 the

page

Outlook for Petrochemicals

By OWEN ELY

British Columbia Power is

first

1.3

-•

$1.1

for
rubber, acetylene, benzene, toluene,
polyethylene, phenol, formalde¬
hyde, acetaldehyde, methyl alcohol, ethyl
alcohol, isopropyl alcohol, butyl alcohols,
ethylene oxide, ethylene glycol, acrylonitrile, acetic acid, acetic anhydride, and
acetone.
The minor products are num¬
bered by the thousands."—Excerpt from

styrene,

"PETROLEUM
Bulletin
lems

556

AND

Bureau

NATURAL GAS"
of Mines, p. 8, A

Facts and Prob¬
by R. A. Catel and others.

Chapter

from

Mineral

Number 5834

189

Volume

.

,

The Commercial and Financial Chronicle

(1549)

2£

It is believed significant that as needed in World War
industry to
II, several licensed patents dealing with the operator
in
the
petrochemical
picture of .the size, and far back as 1948, approximately oil and rubber companies initiated production of a fungicide which field since World War II. Some
scope of this growing field. The half of the efforts of the Shell programs which led to the devel¬ is having unusual success in com¬
years back it set as a company
figuresTor the 25-year.period J931 Development Company were di¬ opment and commercial produc¬ batting crop disease.
objective the upgrading of

leum, rubber, and all

present

a

-

to 1956 inclusive show

the chemi¬

rected to the petrochemical field.

cal industry's growth of 10.8% per

tion

many

of

synthetic rubber. Butyl
discovered by SON J, is
derived completely from isobutylene and isoprene. More than

rubber,

Esso

In

19 5 5

petrochemical

sales of its

above any previous year and
amounted to approximately 6% of

were

petroleum and natural gas
hydrocarbons to more valuable
end products. In the past
decade,

far exceeds that of the other
industries shown. The an¬
Among
the
petroleum
com¬
total
domestic
sales.
Although it has become one of the largest
nual growth rates were 7.8 for panies Esso (Standard Oil Com¬ two years ago Esso Research and their
petrochemical sales have not producers of ammonia fertilizer®
natural gas, 5.5 for rubber prod¬ pany of New Jersey) was one of Engineering announced successful been
published, it is believed that and carbon black. In addition, it
ucts, 4.1) for petroleum, and 4.5 the first to make a big entry in production
of
automobile
tires they were in excess of $150,000,- is
producing paraxylene and
for all industry. Growth is ex¬ the
petrochemical field. Many from butyl and declared that the 000 in 1954. In 1953 they were
methylvinylpyridine for synthetic
pressed on the basis of pounds of years ago, Esso manufactured syn¬ butyl tires have several advan¬ more than $100,000,000.
fibers, and are now in commercial
thetic ethyl alcohol from petro¬ tages over those in present use.
product made each year.
.
Recently the Humble Oil Com¬ production with a new type poly¬
Last
year
petrochemical sales leum via the indirect hydration They have also developed a pro¬ pany, an affiliate of Esso, disclosed
ethylene by their new low-pres¬
amounted to $4.5 billion, rubber route using sulfuric acid as an cess for making butadiene from their
intention
to
manufacture sure
process,
1
(finished goods) $5.5 billion, and intermediary. Later butyl alcohol butylenes and extraction processes polypropylene. This may well be
Phillips was one of the refiners
petroleum products $12 billion. and methyl ethyl ketone were for recovery of butadiene and also an up-and-coming plastic that will to
purchase
government-owned
The
latter
figure is based on added to their list. Esso also man¬ isobutylene.
enjoy huge growth.
butadiene and
year

major

•

wholesale prices before

state and ufactures "OXO" products which

Federal taxes which

both sub¬

'

stantial.
The

"

are

'

income

net

are

per

^dollar

believed to have

an

especially

bright future.

of

For

net worth for the "Chemical and

supplying

In

each

the

rubber

we

the

S.

U.

nearly $3 billion

by

year

search

and

disease.

Esso

Re¬

Engineering has

GR-S plants and
important factor in
butylene, butadiene, and GR-S
rubber fields thus adding to it®
is

Phillips Petroleum

worth of farm crops are destroyed

Phillips Petroleum has been
very

aggressive

and

now

an

the

a

Continued

successful

on

30

page

Allied

Products," "Petroleum,",
and "All
Manufacturing Opera¬
tions," representing an average for
1956 and 1957, shows that the re¬
"Chemical

for

turn

Products"
and

13.4%.

cation of the

12.6%

other is that

All Manufacturing
future

expected

11.3%.

salaried

investment

and

1940

from

to

1958 .'*• the

doubled.

A

than

1950.

1950

preceding data. show the
chemical industry
particularly
the petrochemical segment—to be
fast

growing and profitable.
characterized, however, by
high investment per unit of pro¬
duction and rapid
technological
It

is

obsolescence.
;

The petroleum industry is play¬

ing

major paid in the develop¬
petrochemical indus¬
try. Here are a few interesting
observations concerning successful
petroleum company participation
in the petrochemical field:
a

ment of the

•'

Shell Oil

-

The Shell Chemical Corporation

into

came

chemical

being in 1929. The 1956
production of this

wholly-owned

subsidiary of the
Company amounted to
2 billion pounds with a sales value
of $213,000,000. In
1957 sales of
Shell

Oil

chemicals

were

a

little

less

than

in the previous year but were still

believed to be above $200 million.
From 1950 to 1956 the gross in¬
chemicals

from

come

increased

three

times. The largest sales in¬
creases were in agricultural chem¬

icals,
rubber

resins,
plastics,
synthetic
and organic chemicals.

Among the
icals

many

derived

from

organic chem¬
petroleum on

which.Shell has done outstanding
work

isopropyl alcohol, syn¬
glycerine,
epoxy
resins,

are

thetic

butyl

alcohol

and

ethyl

methyl

ketone.

They have pioneered in
the agricultural chemical field and
in recent years added a urea plant
to their nitrogen chemistry kit.

...

Shell

-

Chemical, in collaboration
with U. S. Rubber, recently an¬
nounced their plans to commercialize a synthetic rubber made
from isoprene that has substan¬
tially the same properties as the

natural product. The polyisoprene
understood to be satis¬

rubber is

factory for
'

size
inter¬
esting that Shell Chemical plans
to sell the polyisoprene for only
truck

use

tires. It

in

standard

is also

very

39 cents per pound.

The

contribution of Shell Chem¬

ical's operations to Shell Oil's net
income is not publicly available.

However, Shell's outstanding rec¬
of net return to gross sales,
assets, plant investment or

ord

total
net

worth—however you want to

evaluate

its
performance
with
companies -— indicates
petrochemicals contribute a signif¬

other

icant

oil

share

towards

earnings.




new

research laboratory

are

expected which will

nourishment for continued

healthy growth!

has been established in Switz¬
AMERICAN
30

CYANAMID

COMPANY

Rockefeller Plaza, New York 20, N. Y.

Shell's

SEND FOR 1958 ANNUAL REPORT

The 52nd Annual

,,

;

Report of American Cyanamid Company, summariz¬

ing operations for the

year

1958, is

Public Relations Department

The

both

developments

personnel is employed in the Company's five

:

:

■

new

additional markets, create new jobs, and provide

to

,

;.

open

of all Cyanamid's

and devoted entirelv to basic research. From these

industry
more
than
high growth rate is

^y

cent

fourfold

From

/.

per

erland which will be staffed with European scientists

expected to continue from 1958 to
1963.
The capital investment in
1963
may
be Lin ? excess
of
$8
billion.

nearly

have

production

better

importance of its research program. An¬

activities

research centers in the United States. In addition, a

growth rate

"petrochemical" portion of
chemical'industry, the capital

increased

half of Cyanamid's sales today are in prod¬
This is one indi¬

highest at
Refining was

of the

the

one

that did not exist ten years ago.

Allied

With regard to the past, present

and

ucts

and

was

Petroleum

Nearly

now

will bring

available. A request to our
a copy bv return mail.

you

/

•

■

<

.vs.

30

The Commercial and Financial Chronicle

(1550)

Continued jrom page

Outlook lot Petrochemicals

on

activities. Phillips quently alkylated with benzene to
form
dodecylbenzene.
Dodecylhas a synthetic "natural" rubber,
benzene is the precursor to one of
made from cis-polybutadiene, that
the major detergents.
is being produced on a semi-works
The petrochemical sales of Cali¬
scale. Such a material may be
competitive with other synthetic fornia Chemical Company2 were
"natural" rubbers when the scale

operation is greatly increased.
one of the largest reserves

Gas-Turbine

natural gas in the U. S., they
have an excellent position in the

will

$70,000,000 four years ago
and were $120 million last year.
Cities Service and Continental
1927

In

ene, and the several C*

195768

number of Gulf-devel¬

oped additive agents, an example
of which is a superior rust-inhibi¬

$100,000,000/year.

tor

International

which

also

has

number

a

of

other attractive features including
Gulf's other interest in the pe¬
trochemical field is through Good¬
now

have

the

Chemicals,
a

Inc.

future

the

plant

at

fuels

do

accepted

chemicals

Port

Neches, Texas. The synthetic rub¬

that has

ber plant at this location is owned

refining
refining

exclusively by Goodrich-Gulf, Inc.
The latter company has experi¬

The

not

come

more a

enced increased sales of its Amer-

over

is

kets

The

ural product and can be expected
to compete for a share of this

latter
In

Company

of

The

Standard

California

has

scale

mous

California

growth

for

be

Company of
pioneered in the

took

place

the

decylbenzene.

to

ufacturer. What followed
gasoline octane race at

acknowledged

This

material

the U. S. of

by polymerizing

precedented

propylene

tetramer, which is

Less

late

be

line
of

Chemical Co. was organized
the
activities
of

Oronite

subse¬

California

Premium Gasoline
ppei)

1955

1936—

'

1960

mand.

'

BPCD




lution! in
and
,

call

forecast

gasoline re¬
estimate of the

In

Table

IV

figures

the

the

The 1955 and
automotive

in

Table

IV

were calculated
by difference as¬
suming 90% of alkylate capacity
was
in operation and that what

man¬

not

was

the

accounted

must have

for

in

avgas

been

incorporated into
automotive gasoline.

un¬

10

should

be noted
that today
only about 125,000 BPD
of alkylate going into automotive

there

and

however,

expected

to

data

by

expanding

rapidly

1964

it

is

fertilizer
increase

that

four

will

present

double

alkylate
in

less

ca¬

than

and quadruple in less
than six years. The rapid upswing
in

years

alkylate capacity is expected to

:

the

best

way

maintain

and

use

the

Manheim,

investment

the

It

has

been

director of

-

to

10

times

of three

the

use

was

William
*
,

by

Bre-

liant,

Chair-

man

of

Board

the

of

the

company.

Se¬

curity

Title,

Insurance

is

engaged in the

;

title

insur¬

ance,

escrow

and trust bus¬

iness in

Cali¬

fornia.
haul

Manneim

Mr.
.

total

current

it

announced

«

primary plant nutrients.3

Com-

anc«

pany,

to

most profitable rates of applica¬
tion, if used at optimum levels of
other practices, would correspond

of

Security Title Insur-,

of"

the

•

partner in

a

banking firm

pro¬

that

reported

prepa¬

Lehman Brothers, has been elected
a

%

/

the

for

Manheim Director
-Paul E.

brought,

greater

lution.

director

of

Man-

heim is also

Western

Union

a

Tele¬

graph Co., The Lehman Corpora¬
tion, The One William Street
Fund, Inc., and Chairman of the
Board
of
Veriientes Camaguey
-

Sugar Company.

*

The

implications of such a volume
become immediately apparent.
oil

Most

natural

companies

are

to

production of meth¬
anol, the second-largest volume
product from methane. Production
of methanol is

pounds

With La H»e Inv. Co.

using

{Special to The Financial Chronicle)

for ammonia produc¬
ammonia plant may be

gas

An

per

now over

year

and

1.5 billion

is growing.

It is used for formaldehyde manu¬

facture,

1960.

furnished

paper.

the

ductivity of our soil while simul¬
taneously decreasing the cost of
production has been: largely re¬
sponsible for the fertilizer revo¬

converted

seen

that
was

capacity presented in Table V.

It

this

AnV increasing;

cultivation,

under

awareness

reach

839,000 BPD.
provide the basis for

of

one

little additional land to be

writer

•

of -

fertilizer

The

McGraw-Hill lor much :of

of

information

increase

tion.

is

839,000

the

calculating the growth in alkylate

pacity

ACKNOWLEDGEMENT:

his thanks to Dr. M. E.
Spaght of Shell Oil, Dr. Jerry McAfee of
Gulf
Oil, Mr.f K. S. Adams *»f Phillips
Petroleum, Dr. H. L. Malakoff of Pc'.roleum Chemicals, Inc., Mr. W. C. Asbury
of Esso Research & Engineering, and Mr.

discussion of

any

as¬

future.

wishes to express

I.

fact's in

of

are

gasoline;

two

to

a rate as

excellent

an

being the' great ah- "
in population and
the other that there is relatively

are

1956 data shown for

alkylate

sure

industry—
ammonia—is

introduction

nual

past pro¬
for
total

both

expanding at such

It is customary to

to

and

fining industry. The opportunities
for growth are enormous and are

the

combination

a

attention

industry:
_

satisfy

to

undoubtedly

several factors.

gaso¬

plants

new

dustry in the next five years will

the fertilizer

in

in

exceed that lor the petroleum re¬

to

particularly

total

our

facilities in the petrochemical in¬

are

ammonia could

petro¬

production. The annual

investment

-

Ammonia

the

of

amount to one-fourth of

chemical

W. F. Bland

;

assets

industry are valued at
billion. Petrochemicals n o w

$5

they truly
chemical

of $6'00 million

years ago

claim

no

total

antifreeze,

and

ST.
V.

S.

PAUL* Minn.—Mrs. Marion
Blodgett has become affili¬

ated with La Hue

Investment Co.,

Pioneer-Endicott

Blodgett
First
and

was

National

C.

S.

Arcade.

Mr.

formerly with
Bank

Ashmun

of

St.

the
Paul

Company.

solvents.

-

As for

Capacity
Year

Capacity

1959.

an

areas.

The

produced

"

a

chemical

being: a petro¬
chemical. Today it surely is one!

pro¬

together with predicted
requirements for 1960 and 1964. ;

ing

I960.

263,000

1962.

273,000

1964.

300,000
350,000

1965

alkylate capacity to

for

an

increase

in

quality, rapid expansion
pected to start in 1960.

BPCD

C'UTclty

236 000

new

Ethylene

be put on stream each year, allow¬

(January 1st)

_____

Many
lay

premium

start around
U. S. Alkylate

a

both

the

development

excess

"

Synthetic

shown

197,000

1,950,000
TABLE V

premium

paper

What has brought about the revo¬

premium gasoline and alkylate

Automotive Alkylate

52,300

and

like

.

refining is becoming

series of gigantic pet¬
operations with each
passing year. The roles of chemis¬
try, and catalysis are prominent in

ration

The

polyethylene by
low-pressure, and hightechnique.

the

rochemical

.

year.

both

more

of

realizes
that
ih
the
industry
(Chemical.. &
Allied Products) expenditures for

per

be reached by
1960. The
figure is intended to cover

Conclusion

one

probably in

Figure 8.
far superior ma¬
developed, a 1.25 billion
per year production
rate

Petroleum

production not only from
of quantity and
but also from the stand¬

research

esti¬

some

pressure

chemical

of

duction

BPCD

1,650,000
______

future

These

1,120,000

for

that

over

and

years

the production of
-

standpoint

when

extensive

information

of

could
above

between

gap

insula¬

are

pound

refinery technology.
There is good reason to expect a
continually expanding p i c t u r e

the premium
gasoline quality and quantity de¬

Spray-Chemical.

52,300

1964.

estimated from

was

needed

coordinate

1.040,000

by

this

are

wire

Production

several

Unless

from modern

newest

isoparaffins —principally alkylate — that would be

This

Chemical

type

quirements plus

California

to

that

scale

a

substitutes.

past

terials

processing
techniques.
Many of the processing methods
employed have been lifted bodily

gasolines in

an

the

devel- '

few'of

a

for

use

mated to 1960 is shown in

quality
point of

industries.

amount

enor¬

than

the

105.6

followed

of

to

-

tions in its low polymer forms as
wax,

serve

part

under

section

devoted

such

quality above regular

required

It

called

fuels

as

about

expected to

significant

a

the

last

be

the

102.7.

starting point for estab¬
lishing future automotive alkylate
requirements. The predicted alky¬

Production of Premium Gasoline
and
Automotive Alkylate

Year

3955

rate.

subsidiary

mar¬

of the petroleum and auto¬

This

syn¬

an

as

of

and fuel

vided the

TABLE IV

1964

to

all

sdid

are

least

on

and regular gasoline
predicted several years ago
expected the average research

We

and

was

established

of

ing blocks)

bridge the

gasoline
the

of

owners

is

intermediates

propylene and butylene;

hydrogen, but hy¬

were

is
2

the

the

deal

intermediates

gaining acceptance, particularly

mobile

because

refiner from the automobile

is be¬

leader in the manufacture of do-

made

"Super-premium"

great

Its

tion, film for packaging, pipes and
bottles, it is finding new applica¬

potential

large

in¬

rapidly growing mar¬
ket for ethylene is in polyethylene
plastics. In addition to* its well-

petrochemical building blocks and

octane.

rate

One

per

The most

the'

over

pounds

rapidly.
steadily

*

ap¬

threshold

growth

(petrochemical build¬

The

of premium

of

catalytic chemistry was wellestablished, the processes were

Oil

wholly owned subsidiary)
to

The

to

industry

the

rapid

drocarbons

will

model high compression ratio cars..
The anticipated octane numbers

develop¬
refining in the
an

The

*

chemical

both

re¬

opment.

super-premium

understood

A

many

4,000,000

100

is

with

utilization of aromatics. The Oro-' available and tremendous
pressure
nite Chemical
Company2 (a was being brought to bear on the

lieved

instance

one

under

gasoline.

attention.

fiber

on

boron fuels and

con¬

refiner

a

better than

are

survey

the

field.

a

fuel

is

outstanding

past 10 years has been
thesis of aromatics on

huge potential market.
Oil

most

of

billion

is growing
derivatives is

creasing until it now contributes
nearly twice as many chemical

and

outlet for future petrochemicals ^
in the missile, rocket, and jet fuels

"premium" and a
"super-premium" fuel, all of the

series of chemical process¬

ment in petroleum

Where

both

and

more

now

approximately

91.6 octane.

taking place in oil
the years. Petroleum

becoming

during

at

is

be

ahead.

years

Changes in

States

to

continual

barrels of automotive gasoline per

paper on

been

lot

a

synthetic

pear

needed.

be

United

grade

present

the

day. At the present time 30-35%.
of the gasoline sold is "premium"
or so-called "super-premium."
Today in the U. S. A. premium
gasoline averages 99.0 octane
(C.F.R.R.)
and
regular gasoline

definition

no

decades.

two

suming

ipol rubbers and latex. The so- ing operations. Today's premium
gasoline is a clear cut example of
called
"Ameripol SN" synthetic
this change in
rubber is very similar to the nat¬
refining practice.

Standard

automobile industries

last

likewise

Engine

the

field dur¬
This con¬
examining
petroleum

engine design have
required—and will continue to re¬
quire — increasingly higher oc¬
tanes. More premium gasoline will

of petro¬
petrochem¬
icals would be complete without
recognition of the gradual change

They

substantial interest in

butadiene

though

the

four

and

of

to

now

forecast
Even

also* been

previously
mentioned
materials
probably exceeded 40 million
pounds per year in 1958. A huge

octane number of

Combustion

have

lowing item appeared in one of
(he leading trade journals for the

December

automotive

Petrochemicals

anti-stalling.

rich-Gulf

excess

foams

ceiving

the

Mid-Soqth Chemical Com-

chemical sales will be in

thene

domestic production of each of the

and

p a n y,
an
anhydrous
ammonia
petrochemical activities of marketing company. This com¬
the
Gulf Oil
Corporation have
pany has undergone a major ex¬
been primarily
in the field of pansion
with
construction
and
ethylene production and distribu¬ purchase of additional ammonia
tion and also in the manufacture
bulk distribution stations, dock
of iso-octyl alcohol via the Oxo
facilities, and construction of
process. In the early 1950's Gulf
barges for transporting ammonia
entered the ethylene business by
to a number of terminals on the
building a plant to manufacture
Mississippi Valley and in southern
150,000,000 lbs. of ethylene/year. Texas. P.C.I, has built a
huge am¬
More than three *years ago they
monia plant for Lake Charles to
completed a second unit to manu¬
supply the requirements of Midfacture an additional 220,000,000
South. It is understood that their
lbs./year. Last year their ethylene new
huge ethylene plant is on
production was close to 400 mil¬ stream and that
ethylene glycol
lion pounds. It is understood that
and butyl rubber plants will soon
Gulf is currently manufacturing
follow.
When
these
plants are
approximately 9,000,000 lbs. an¬
completed, P.C.I, will have over
nually
of
high-grade
iso-octyl
$80 million invested in petrochem¬
alcohol and that demand exceeds
ical plants. It will hot be very
capacity. There is a growing in¬
many
years before 'their petro¬
a

,

of

cess

year

recent- list

fol¬

The

terest in

in

newcomers

industry: "Auto en¬
predict gas turbines market could
develop} for many
will
make their
appearance
in., basic intermediates of which
only
production-model autos within a few examples are 1,4 trans2-7 years." It is my opinion that
polybutadiene fiber, cis-polybutgwe can abandon any consideration
diene" rubber,
copolymers of
of significant inroads of either the
ethylene and propylene, and isogas-turbine or the free-piston en¬ cyanate foams. Huge segments of

they are at least as great as pres¬ tons per year.
ent
profits from oils and gas
Cities Service and Continental
operations.
/
also purchased a controlling inter¬
in

many

mobiles.

gineers

proc¬

ings from petrochemicals could 65,000 tons per year. The capacity
easily expand to the point where has now been increased to 80,000

est

been

replace the conventional in-

petrochemical industry. The com¬
pany's activities include fertilizer, ess, manufactured formaldehyde,
synthetic rubber and plastics. methanol and acetaldehyde. In re¬
Sales of petrochemicals were esti¬ cent years Cities Service and Con¬
mated at $130,000,000 for 1955 and tinental formed a petrochemical
are
believed to have been sub¬ subsidiary called Petroleum
stantially greater in 1956 and 1957. Chemicals, Inc. (P.C.I.)
Three
Within
the
next
two
or
three
years
ago
P.C.I, pur¬ gine in the automotive
years,
their petrochemical sales chased from the government the ing the next 10 years/
clusion was reached by
are expected to be double the 1955
Lake
Charles
butadiene
plant.
in the
sales. It is conceivable that earn¬ This plant has a capacity of about developments

Gulf Oil

aromatics

ternal combustion engine in auto-,
Last

Thursday, April 2. 1959

.

natural gas. The growth of ethy¬
lene as a chemical raw material

as

—notably paraxylene—there have

Engine

with petroleum

Service,

Cities

building

it has been pre-, years:
Epoxy resins is .just one
dieted many times, that the gas- example of many
that- have
turbine and the free-piston engine appeared in the
plastic field. Ure-

about

their natural gas oxidation

basic

intermediates such

In recent years

With
of

scale.

enormous

an

petrochemical

the

to

and

.

ethylene, propylene, the various in the last 10 years has been
butylenes, acetylene, synthesis gas,, spectacular.
Its ...present
annual
ammonia, methanol, benzene, tolu-> consumption is at the rate in ex¬

refining
been

addition

blocks

developments in petroleum
in the past decade has
the synthesis of isoparaffins

ing

of

In

from today we may be say¬
ing that one of the most outstand¬

years

29

.

alkylate
is

ex¬

408 000
•

570.000

1,000.000

1,400,000

Developments
chemical
to

come

in

the

at

a

very

and

as

the sec¬

highest
tonnage
material
supplied
from
petroleum
and

rapid rate.

1 Nitrncrcn.

nhosnhorous and not&ssium.

.

Wack With Troendle
J Special to The Financial Chronicle*

alkylate, which

largely burned as fuel for the
internal combustion engines, ethy¬

ond

petro¬

industry have continued
in

aromatics

as
are

lene follows ammonia

Petrochemicals

•

r

Except for petrochemicals such

LOS
L.

ANGELES, Calif.—Roland

Wack

has

become

associated

with Victor Troendle &
San Vicente Boulevard.

in the past was in the

partment

oL First

Co., 631£
Mr. Wack

trading de¬

California

Co

189

Volume

.

Number 5834

.

.

The Commercial and Financial Chronicle

.

(1551)

Continued from page 18

budget

-

/

Growth Stocks

Exemplified
In the Chemical Industry
as

•

•

>

se

indus-

guarantees

through their emphasis on reproduct development,
technological innovation, and agPH^^ship of a research labora- gressive merchandising.10 Accordtory could guarantee a successful ingly, dynamic companies attempt
future, every company in the land to develop new products which
would have one."0
Despite the will command potentially large
success.
As Graham and
Dodd said years ago, "if the mere

incident
ac;

;

.

recurring growth
requjrer: ; Enjphasis ; on_ research—CorpoIn fact, the corporate
diyi-i\.rate-spbnsored research and new.

per

trial ;

formidable market and time risk0

plow back a substantial portion of and" the investment benefits
earnings to meet their expected crtiing to stockholders0 J*,.
and

.

^

ments.

policy of growth companies. product development are poweris largely formulated
in these .ful '^actors of corporate growth in
terms, and accounts for the
-particular.and economic develops
that, in'contrast to other, equity ment in general.
As presently
groups, the dividend-payout ratio
competed by corporations, reis typically modest.:. It is note? search, is
typically of two types:
dend

..

.

to

new
products
and
which emanate from

processes

R&D,

it

remains/almost

certain

that the companies aggressively

typically capital-intensive, research-grounded, and technologically advanced. Moreover, these

are

search and

industries

seem to enjoy superior
control, vis-a-vis the "static industries," as a result of such factors as regulated output adjusted
markets so that
significantly en- to demand, predictability of suplarged sales, low per-unit costs, ply, uniformity of product qualand generous profit margins^ will' ity
ityr relative stability of prices,
be secured.
In seeking out these
phy«~
physically
wu
contiguous and intermarkets, growth companies nor- loeking productive* operations, and
mally engage in detailed product "inanimate mechanisms* utilized
and process planning. Elaborate as raw materials. In contrast, the
research is often conducted to es- "static industries,* which are typitimate the probable demand, at cally dependent upon organic
7

j

•

~

-

research-minded today will be
among the industrial leaders of
tomorrow. With their heavy emphasis upon R&D, the growth
companies are destined to be in varying prices, for the company's

the vanguard,
Underdeveloned markets

Tak

31

processes,

are"

consequently

newiy developed products. Simi- plagued by uncertainties arising
new processes of manufac- from the vagaries of the various

larly,
ture

are
normally put to severe climates of the- continent and1 the
testing under pilot - plant and endless heterogeneity of nature,
growth requirements is to Jhe dis-.: .broadened and balanced program seu
semiwork
conditions long before An inherent weakness* is transtheir nroducts and services
-tinct advantage of both the growth
embi;aces ■ several interdependent are typically far from the noint the company embarks on an ex- mitted
to
these
industries,, as
companies and their
stockholders, phases ,o£ research: exploratory of saturation. Not only are estab- pensive program of constructing manifested in such- ways as a
From the company standpoint, re^search conducted
outside
the lished markets expanding but new full-scale plants.
drastic fluctuation in the yield

Zllthyeen'emted
lim"fd to tech"
generated Pfunds
tunas °to
.to 'mS
meet. pol©gical applied>
operations. However, a
nally

^

established

and convenient method, of fmgnctP r.og r a m;t
....

.

.

-•

..

>..■

-

^

j''

Growth

Expanding industry—Practically

kEL0wledg^ ^without rer
——

ehandising

:commercial and investment.ba.nkr

tions into new plant design?,?Qwthe growth period ipgto the unquestioned success of
progresses, during which period research'arid development (R&D)
.earning power is expanding rapr ^n its effects upon cost savings,
.idly and dividend payoukremainsv sales and' market growth, and en-

;ThUS,

corporate manageat ed^,,ment. is faced with a continuing
-funds
become available
to r-a
question: How much should the
growth company, both for financ¬ company spend on R&D?
Obvi¬
ing new capacity and for paying ously this is not a problem easily
e h br

enlarged dividends.

solved, for
Similarly, stockholders of depends on

meaningful

a
a

availability of

in

growth» stocks, but
turn out to be a small
as

gressive

building

compared to the pro¬

of dividend

up

and capital values

return

over

a

considerable

reasonable

a

long

so

average
ment

as

from these stocks

secure

annual

cost,

yield

together

capital gains, than
from

an

with

larger

be obtained

can

equivalent investment in

stable-income
term

higher
invest-

a

on

equities

for

holding.

within

long-

.

estimates

of

market

postulated

determinants

earning

of

power

the

as

high

ultimate

rising

and

of growth

stocks,

and, unlike- the financial charac¬

terises through which they
ate,

they

exact

are

,

not

quantification.

mental

oper¬
to

amenable

The funda¬

characteristics

are

.

automated industries* i*

Production
„

Continued

,

.

.

9 it is estimated that four out of

five

new

products

developed

via

every

ll For a

tain common characteristics: they

quiry

r&d

into

between-

markets for

Business
1956,

pp.

September >-October,

Reviewf

mann,

the

fundamental
-

oriented

toauVirl..;

(Harper &

87-98.

nomic considerations.

At

lower

a

essen¬

Mountain Fuel

Supply Company,

Salt Lake City,

Utah, reports:

Brothers,

Another Year of

1S clear: failure to conduct an
adequate level of research can be
fatal, for such a policy can even-

tua"y destr0>' a company's

capac-

ity to compete effectively. Even
though R&D is a long-range gam¬
ble, it is even more risky for a
company to fail to conduct any
project research at all.
need

for

research

is

Outstanding
Utah-Wyoming Area

Engaged in the production, transmission and

communities in the
mountain

region.

competition which it breeds

be

to

a

imagine that

so

rapidly expanding inter-

Highlights of 1958

and

(and

comparison with 1957)

as

Total gas

operating

large research

revenues

6 The fundamental characteristics de¬
veloped in this paper, though not neces¬
sarily applying with equal
force
and

Net income

to

the

diversity of common
which may properly be identified
growth stocks, are believed to be suf¬
ficiently general in scope and regular in
occurrence to comprise a nucleus of causal

1957;

1958

No one,

foolish

fc

relevance

serving 82

.

f° the increasingly complex tech¬
however, would

now

self-

perpetuating, owing to the sharper

nology which it creates.

^

distribution of Natural Gas

...

...

Net income per

$25,160,075

......$26,0881,644

$" 3,754,434

$

3,438,800

share ....$

1.57

$

1.20

$

1«20

18.87

$

18.50

1.72

stocks

tially

qualitative

•constitute

ground

the

factors

in

dynamic
whose

/

earning

power

nature,

back¬

impact

«,

can

and

..

be

on

i

only indi-

rectly deduced from the corporate
+ -

opeiating

t

and

r~

.

.

financial

J

records,

as

factors making possible high and rising
earning
ally.

power

of

growth

stocks

gener-

7 Kenneth H. Klipstein, "You Can Turn
R&D from Blind Alleys," Chemical and
Engineering News, July l, 1957,

TABLE

pp.

18-20.

I

Company

Available

,

Av. Retained

Payout Ratios

Earn. Ratios

by Percent.

by Percent,

for Common
as

Percentage

of Equity Capital

20

29

62

38

18

32

52

14

55

Eastman Kodak

51

49

15

28

Hercules Powder

62

38

19

23

Olin Mathieson

55

45

13

291

American

52

48

14

28

Allied Chemicals

63

37

12

24

Over-all company aver.

57

43

16

31f

^Excludes the General Motors dividend contribution to du Pont stockholders.
/Excludes Ohn Mathieson as abnormal and
unrepresentative of sales growth.
SOURCE:

Moody's Industrial Manuals.




ganization

in

been

paid each

1935.

144,341

155,444

Listed
^

year

since its or¬

Pittsburgh Stock

on
K

1958 Annual

Address:

Report will be sent upon request.

Secretary, Mountain Fuel Supply Com¬

of Sales

35

Cyanamid__

have

Increase

65*

48

Dividends

Av. Annual

Union Carbide
j.

Number of customers....

Percentage

E. I. du Pont__

Dow Chemical

share ....$

'.

Net Income
,

share ......$

Book value per

Exchange.

Selected Financial Ratios of Eight Chemical
Companies
for the 10-Year Period 1946-55

Av. Div.-

Dividends per

pany, P. O. Box 989,

Mountain Fuel
180 East First South

Salt jtake City 10, Utah.

Supply Company
Salt Lake

differences

and

science-

New York^ 1951).

limit,

in

;

32

sM

potential,
techni¬

"defensive" research may
be budgeted in preserving a com¬
petitive status quo in the industry;
or
additional
budgetary outlays

WW

WWW
World Resources ond industries

-MM
tory inception and developed
the successful products.

071 VUQB

stimulating and1 profound In¬

nature

manpower,

cal feasibility, the patent situa¬
tion, pilot-plant results, and. eco¬

The

The fundamental characteristics

are

.

the

Fundamental Characteristics
'

Tndn«triai

growth industries sharecer-

the

period of time. Thus,
probability that,
growth companies as
a
class are capable of producing may become necessary to pursue
high rates of return on invested "offensive"
research
by
which
capital and of compounding per- new and undeveloped markets are
share earnings, the investor can penetrated. In any case, one point

it is

Tnjpv

tors, among which is the nature of

mitments
may

by

answer

technology and competition
the
industry.
Moreover,
justification of R&D projects
would be determined by informed

sacrifice

merely

constellation of fac¬

growth companies should eventu¬
ally benefit from a heavy plowback policy. In the short run, in¬
vestors
may
forgo what would
otherwise be larger cash dividends
and higher current yields by com¬
this

most growth companies '

—•?:}/.'• '/.>•;v'7;;
8 BenjaminI GrahamI and David Dodd,

as

(internally g

.larger

•

Hc\v-pi.uuuui
ucnew-product
de¬
It is interesting to ob-

of a crop or in the price it brings,
the most dy- Agriculture and the;: industries
nnmic companies participate in primarily depend*ent on thiS
rapidly expanding industries, source
of raw materials ar»

without exception,

These "growth industries" are rec- closely linked with the rhythm
ognized by the fact that their rate of organic life and seem to* lack
earnm^as at -pleases, tQ,. produce " new, b e
expanding of physical expansion and output that higher degree of control over
frnJnkf
Products; and^ process de-.-markets induced by population or is usually higher than the growth processes and mechanisms charlmmunity xr m the judgments oi velopment in converting laboraincome changes /but
bv actively of the national economy, as meas- ontprictip of th#> more scientific
outs.de financial .groups
Uvizv^tofy' data -Via pilot-plant opera-, creating massive hew markets ured by the Federal Reserve Board
/n

:ers).

<

mer-

emu
and

velopment.

potenT..vserve,that

aggressive

research,appareiltly grow riot
t t.e r, and adjusting passively to

.to. remyes.t

.

through

....j-.Tf..vimuuiaiiig

capital. AVithin -^sic-research in fields, .of-broad limitsr managements is. free
tfal commercial interest;

.

mar-

mmmnips

company

fundamental.: .-.research,•;creafe(j

eliminate primary dependence^on gard-;to: ite, commercial feasibility.;
external sources of

'

tog
a long view, the multiple
uets ;n which

City 10, Utah

32

The Commercial and Financial Chronicle

(1552)

,Continued from page 31

Growth Stocks

Exemplified

are

growth

industrial

The

process

in technological
new technology

deeply rooted

innovation.

But

pected

to

occupy

and

competitive

The

mere

in important

situated

substantial
benefits - obtainable
from growth stocks when such
bought at reasonable
values and are held for permanent investment,
:
stocks are

entea eSnf

Share muJtiplication-The long-

of huge aggiegaUons of
capital, oi the possession of out-

term rapid growth of per.share
earnings and dividends of growth

standingrru mstances

stocks

cal skills
tend to

typically

is

^seh
share multiplication.
P^cjude theithat the investor
sid<^irms
Srowth stocks *°r a
which are dominated by a few

This means
who
holds
considerable

n

c^tiS^^eam

period

time

Qf

t,os:+:on

+G

.g

in

usually

accumui'1te

a

mihstnn-

n

basis.

ume.

The

fact

that

ieadmg

a

com-

is situated in a rapidly expanding industry (measured in
physical
terms)
does
not,
of
course,
ipso facto
make it a

pany

"growth situation" in its investment significance.
The controling factor is the ability of a
company to convert its participation in a rapidly growing industry

Into

commensurate

a

in

growth

per-share earning power. Because
public-utility companies must opin

erate

their

a

common

ously

stocks cannot seri-

considered

be

situations.

climate,

regulatory

"growth

as

"

;

Aggressive management

The

—

controlling and coordinating point
in the entire growth process is an
aggressive and risk-taking management.
The
performance
of
auch a management is variously
measured
and praised for the

ability

costs, develop
and market new products origieating from research, enlarge its
chare of the market, introduce the
principles of "scientific management," avoid labor conflicts by
liaving sound labor policies, suc¬
cessfully build and operate new
capacity with increased demand,
and finance its growth require¬
"

to

reduce

"

"

ments

to

the

'

'

long-term

©f the stockholders.

benefit

In appraising

the management factor, one must

usually

deductively from
and financial rec©rds of the company, since field
contracts and personal acquaintanceships with managements are
largely beyond the reach of most
the

reason

operating

investors

and

additionalushares

retaining

as a result
dividend and

stock

gDj^g jssued to him and bv

lights

issues

shares

exer-

acquire

to

of

™on stock"
illustrates this share-

new

'

debt-to-equity

recurrent expansion

ization programs

by

internally

these

and

lL

.

..4

nidusby the
economics of oligopoly." In these
industries, competitive conditions
characterized

relatively

are

and*

have already passed through the
unsettling
industrial
stage
in
which

atomistic

other

the

with

inn share in

piied

ment will

that

his

The
ess

a

This

companies may exhibit

diversity of forms. In
growth

company

one

can

form,

be

ex-

mainlv

durine

12

proc-

neriods

general

prosperity

are

it

because

js during these periods that

earn¬

growing most rapidly and that

enormous

must be

expansion reouirements

S

corporate management
stock dividends and

kn0wn to

cussion

here

in issuing

snlits

are

justifytothei^disThe

of

use

riuhts

^'growth industries." This is an
important point. It suggests that,
ky reason of their oligopolistic acquiring capital from current
P°wer, the corporate giants in stockholders via rights issues is
an
ca^ continue to pro- one of the principal means of
duce high levels of profit on ex- supplementing retained earnings
Panding sales and invested capi!ak w h 11 e remaining largely
immi}ne1 to the prospect of ag8ressively stepped-up competition
because of outside firms coming
mto the industry. In ^ such a wellcontrolled situation, it is not surPris}n8" that these growth compames are
and rising

characterized by high

earning

Investment

power.

Characteristics

when
expansion
requirements
must be financed. Consequently,

the

which

be derived from long-term

share-multiplication

process

—an enormous advantage to long-

term investors — is largely determined by (1) the rate of pershare earnings growth, (2) the
extent of earnings plow-back into
new capacity, and (3) the supple¬
mentary methods employed by
management in financing growth

requirements.

The secular uptrend of
earning
power is the essential condition

S^»S?SSweJlle
investment benefits

may
own-

Above

-

average

yield

widel'y^ecogniSdC

results—

thetowst-

u

dassTend to^en

„

thetj,
ratios
W:

cufTent

growth stocks have the potential

dated

with

nentlnn^T
this

general

connection,"

£red y?es]on' The Role of Mergers
versity of California Press,

see

J.

in the

u"!-

19531.

p0wer

p

ot>

of

on

ership of growth securities, if
high price-earnines
and
they were originally purchased at
vields
These Xnilv
reasonable values.
Accordingly, iarpp nrLinmo Sh

v.win

the

^xn^cbit^o^n/^v"
f

-X*

andmarket^valieseaHowg
values. How-

.?

premium

basis

^ reasonable

and

held

for

a

Share

Av. Annual

Multiplication
^

Dow Chemical

American

Cyanamid__

on

Av. Annual

Percentage
Capital Gains

Yield
on

Growth

Invest. Cost

Invest. Cost

Ratesy

2,892

24

83

7

972

12

32

6

16.515

18

54

10

889

7

13

2

1,760
1,233
18,000

17

Eastman Kodak
Olin Mathieson

Yield

Av. Annual

Allied Chemical

Over-all company aver.

'

42

with
slow
growth, and are not
"growth stocks" in conformity with the
13 For

advanced
a

rating

in

this

system

agerial

performance

Jackson

Martindell,

is

paper.

by which

measured,

Manual

of

man¬

see

Excellent




Based

with

tional
of

Managements, J957 (New Y<-rk. American
of Management, 1957).

Institute

*

and

common

shares

...

the

on

10

4

42

10

8

12

3

14

36

6

as

of Dec.

shares

in

each

stock

SOURCE:

Moody's Industrial Manuals.

I

as

of

Dec.

each

in

Investor A in 1926
and held continuously for the en-

suing 30-year period. During the
period, he has retained all stock
dividends
and
splitups and he
all stock rights to

exercised

chase

additional

running record of yield
for

cost

pur-

Thus,

common.

in-

on

each year be-

31

simple calculation.

a

for

each

stock

-sj.;

suits are produced by growth
stocks when held for long-time
investment.
"
Advantages of owning growth
,

stocks, if they
vious to all/

out, are obSuch investment

pan

media

are especially attractive
those seeking long-range re-

to
tirement-income

such

goals,

..

it

the number of annual peThe compounded growth
rates (the last column of Table
II)
are
derived
by
applying
secular - trend
analysis
to
the
by

riod's.

of yield

build-up

the

as

investment
period pro-

on

30-year

for each chemical stock.

gresses

Substantial capital gains
most

the period of holding progresses,
Moreover, growth stocks should

-

^

■

.

W M

popularized feature of
stocks*is the expectation

A

VBD" «

t

.

ClAftlr Sfllfl

Wglldl OIUUH OUIU

:

Sano & Co., on March 20 puboffered
as
a
speculation

licly

300,000

The

ki

■

SldllDdnl Sl£lt &

of

shares

stock

common

£pai:A°.ca"ts>. ^ Standard Sign
$1 per share. The

a

growth

Sve^reMveV^ort ISdsTf
time

(e.g., one year). From the
viewpoint of conservative investment, where income requirements
are the
primary consideration, I
would suggest that an appropriate
function of
(unrealized) capital
gain is to serve as a potential offopf

vield

low

+/%

*>'

proA

SJ,®.IJ

prf0r
p
J*

to September

1956

1?®

'

f8P

c

trsffic si^ns

invest —

on

S buHd?ng

shelter'lelse

new

eharees'hmr adTerhsiim^and

was en-

»

^n^
3nd si^nsls^

" then branched out into the
saMactorv^^levels durine the first Safety Sch°o1 Shelter business
decade of Llchnl
Table II sum- which Provides a
new medium
m^rizls the exceDttonal caoTtel- for outdoor advertising. This new
Sin results attributed to the line of the business 13 conducted
chemical stocks for the 30-vea? h* the American Safety Scbool
nertod
In the case of du Pont Shelters as an operating division
st<Sk 'an initial 100-share com- of standai'd Sign & Signal Co.
mitment
in
926
together with In a short time the Sa£ety School
the cost of exercising stock rights
Shelter business has grown to apcons ttutes fS^Tnvlstment cost'
Proximately four times the volof S25 115 for the 30-veS neriod
ume of the tra£lic si2n business,
The l955 market va?ue of du Pont5
^
shares accumulated in the port^
J

ment cost which

up

to

.

provide'™" total SpS'5
$646,683, or the equivalent of

of
an

capital gain of 83% annually.
It is no wonder that
growth stocks, such as du Pont,
are regarded with glowing enthu¬
siasm by the investing public.
average

shown

in Table II

wm

be^t^olte^^eTp^

|^of
Sh&U"
*>cnooL bneiter business.

Hyland & Rice Appted.
By Inv. Co. of Am.
LOS

ANGELES, Calif. —Law-

^

T

ments:

(1)

earning

and

rapidly
expanding
dividend power, of

which market values

are

a

reflec-

the spreading recogni-

(2)

investment quality of
stocks, as reflected

chemical

multipliers; and (3) in
cases, rising dividend-pay,

ratios

It is

power.

that,

power

a

the

in

growth

of

j

.

to

relative

should

„

earning

reasonable estimate

future,

earning

only

ih+e Ad?

the

and dividend

continue to exert

pniri^anV

factors

stocks,

are

since

probably

Ampri^f ?n^estaaent

nf

£aST
t
Love-

?

p„vl^ ?
comPany.
nT1^^^T,p^af^aT1 ® 'viec-presiident
® ^
?+nr*3 irec"
^ ^
^
'^'ircra^J Company,
^ ^lce ^ vice-president a direc^or» an^ manager of the in-

,

vestment department of the First

National Trust and Savings Bank
jn gan

of

the

j3jego jje js ajs0 chairman
City of San Diego Funds

Commission,
c

v-

f?*

*>i

j»

y*

IVlurdlCniclJi Upens

SPmpod K- Murdichian is

gaging

chemical

J^vv~

can

explained largely by the existence of three major develop-

some

over

as

/

businessmen or professional peopie who, let us say, expect to
reach retirement age in another
25 years. They can probably look
forward to a growing yield on
investment cost, together" with
larger potential capital gains, as

The

influence on
lnfluence
on market
market values
\ a u s of the
n
<•

The "funda-

"

provide at least a partial hedge
against commodity price-level advances.
In fact, it is hard to
derived
simply by totaling the imagine any equity group better
separate annual yields of each designed to offset the risk of
stock for 30 years and dividing 'long-range inflation,

comes

out

1925

con-

investment results of average annual yield on investment cost is

in higher

31, 1955.
-

A

been made by

the

alj rights issues to acquire addi¬
multiplication" denotes the number

on ^ growth of yields on investment cost computed

30-year period.

in

certain

on

calculations.

commitment

increasing

and splits retained, and
exercised thereafter.
"Share

accumulated

t?ased

100

dividends

stock

and

,.

462

of

based

are

100-share

tion;

6

7

17

5,340

original commitment

all stock

II

tion of the growth factor and the

ciated

definition

stocks.

the

as

be

by Number*

Union Carbide.

Table

chemical stocks

the

of

results

cal stocks

Percentage of
Compounded
Percent, of

growth

interest,

compound

growth factors, operating
through the financial! character-

Generally, the very impressive
capital-gain results of the chemi-

TABLE II

Investment Results from Long-Term
Ownership of Eight
Chemical Stocks for the 30-Year Period 1926-55

Company
E. I. du Pont

annual-yield results obtainable
from
growth
stocks.
The
derivation of the investment-yield

ton

issues, leading to share enlargement, is of special importance in
the case of growth companies, for

of

advanced

been

(relative

Table II illustrates the high av-

cost

™ii

probably share fully in

Hercules Powder
Indeed, there are some utility stocks
which
have
demonstrated
outstanding
growth: e.g., Tennessee Gas Transmis¬
sion, Florida Power, Texas Utilities. Nev¬
ertheless, most public utility stocks are
relatively stable-income situations, asso¬

the

bv

share-multiplication

occurs

financial

—

mnlti-

been

shares

16 515

invest-

ratios,

and distinguishing trait

©f growth

has

assures

the dynamic development ol such

operating results provide evi¬
dences of managerial proficiency.

a

into

1Q26

endof 1955.

competition

oligopoly

stockholder

high prices

erage

vestment

eight rights
during the 1926-55 period;
hence, an original commitment of

ings, dividends, and market prices

associated

the

of

a

stockholders

to

oligopoly
characteristics:
e.g.,
petroleum, aluminum, rayon, rubber, and electrical equipment. The
higher measure of market and
technological
control
which
is

funds—

Competitive superiority

two

operation
has

istics of wide profit margins, high
rates of profitability on invested
capital,
and.' heavy " plow-back,
to earnings) which must be paid policy, make possible the longfor growth
stocks, even though term rapid: growth '.of earning
growth rates of earning power power by which; in turn, the sumay be impressively rapid.
perior yield and capital-gain retion

stock splits and has made avail-

and

necessary

and

Gf

largely financed

many

dividends

tended to prevail. There are several
"growth
industries"
with

modern¬

generated

stock

issues

they

stable,r for

working basis

a

as

stable-income
common
This "time risk"-is a func-

quality,

stocks.

a^ie

,

growth

many

are

normally
require
a *. minimum
holding period of a decade or
to attain and exceed an av-

chemical stock is assumed to have

security

analysts.
Thus, a long record of high and
rising earning power, steadilv individends,
sound
net
creasing
working-capital position, very
moderate

,

paper

accounts.

Qf

seven

Today,

this

be

number of
fr0m his investment

ev-

m

must

assumptions

nets

tries"

in

But one point for
identifying
growth
stocks,
emphasized.
Even the High and rising earning power,
spectacular growth stocks growing in accordance with the

tutional

in

reflected

products.

derived knowledge
produce a continuing
stream of new products and proc¬
esses
on
a
lower-cost, mass-vol¬
which

of

characteristics has been developed

of

and

to the frontiers of new

nearer

%

framework

mental

scientifically

ate

oper¬

attractive for

most conservative insti-

descriptive

annual yield of 5% on incost, which is normally
obtainable from a group of high-

the

II

Cp?c S?nTabic
II
via R&D or by aggressively
muitiDiiCation
nrn"< For
HicrnvPiW
multiplication process,
merchandising
and
mulupilca"<>n piocess. ror
tor exexnew
applications for establishecl ample> Dow Chemical has issued

Jvgrowth industries" which

them

makes

the

Conclusions

*

growth AKa

of

vestment

««h!?tantial

panies

feature

appreciated

erage

demonstrates 'tja|

successfully with aggressive com¬

reinvestment cost. This less

on

*

■

trolling and pivotal characteristic

ment

pawns

suits

curren|

the

in

more

marized

Table

sufficiently long period of time, .maximum levels
growth stocks are capable of pro- ^ock.mark&t. ~

one ment results" derived from longterm ownership
of several
leading growth stocks representing the chemical-products industry; it gives clear evidence of the

large units. In another form, a
in inter-industry growth
company^
struggles for survival and su- compet t
premacy. Over the long run, com- ability
to contiol a substantial
panies operating m declining in- shaie of the markets available to
rinstrips rannot hone to comnete
it. Market control may be secured
but

in

Thursday. April 2, 1959

more

Jekyll and ing favored with a considerable
Mr- Hvde nature: it both creates element
of monopolistic power
and destroys.
It creates new and by which oppressive price comdynamic industries
and, simul- petition is kept in check. Along
taneously,
it
may
shatter, the these lines, a growth company is
foundations of other :established usually protected by various legal
Industries by producing a state of and economic circumstances, such
maturity / stagnation,
or
obso- as the control of important pattechnological superiority of the
petroleum industry over the coal
Industry is a well-known case in
point. This type of technological
competition is largely responsible
for the emergence and disappearance of entire industries.
The rise
and fall of companies are often

even

expanding industries, be-

has 'something of a Dr.

lescence.

stocks

growth
stocks from
other equity types of investment
media. To illustrate, I have sum¬

.

.

"invest-

position

a

pragmatic test which clearly dif-^

Of

importance in

commanding
or more

ducing very satisfactory yield

ferentiates

In the Chemical Industry
Is

of
producing
significant
share
multiplication,
better-than-average yield
results on investment
cost, and substantial capital gains.
These expected results
are
the

.

m

a

securities

the

other

from

near

their

New York City.

offices

at-

135

enbusiness

Broadway,

Number 5834

139

Volume

.

.

The Commercial and Financial Chronicle

.

A"

Our

Securities Salesman9s Corner

Reporter

billion of 4%

their

upon

is

which

broker

based

advice

for

and

facts

upon

can't bury them. Re¬ which is honestly presented. That
gardless of the research and study is why it is necessary to come
given to investigation before a right out with the facts even when
situation is recommended to a they are unfavorable, because in

takes;

he

there

client

times when

are

un¬

it

avoidable

circumstances

make

necessary

to reverse the original
When such a

recommendation.

situation arises there

is only one

thing to do and that is to bring
the facts to the attention of the
talk

and

customer

it

If

over.

a

sale is indicated then recommend

it, if it is better to sit tight and
wait it out then suggest it; or if
averaging may be advantageous,
suggest that, but by all means
don't leave your customer in the
dark.
The only
way
you
can
confidence

his

retain

the facts to him

to

is

bring

promptly.

Retain Confidence
The

only

reason
your
client
does business with you is that he

believes in your firm, its recom¬
mendations and in your ability to

other way

no

can

a

client's

yield

from

July

15,

2.25%

1961

to

at

for

young and growing firm to a few
of my clients. Everything was go¬

along

bid

a

of

for

the

combination of coupons, a net in¬
terest cost of 3.58424%.

Poor's,
the bonds are direct and general
obligations of the Authority. They
are
secured by the pledge of all
rentals payable by the Common¬

seemed to leave with him the im¬

under

pression that everything was just
what

not

should

it

could make,

be.

Before

I

further check I was

a

advised that their certified public
accountants had

made

mistake

a

in evaluating tfhe inventory, which
created a loss for the prior year
of several hundred thousand dol¬

lars instead of the profit that was
announced.. This was not an error
of

but strictly one
accountants; there whs no
question of the integrity of the
management

of the

officers.
After
there

the

ascertaining

and that

thing to do

only one

was

facts

who
held the stock before they heard
the
In

news

this

that

from some other source.

situation

the

best

it

decided

was

course

sit

to

was

tight and hold the stock pending
recovery
in
earnings
which
seemed to be indicated by recent
events.
While discussing the sit¬

a

uation

with

one

client

we

Standard

wealth from its
leases

current

&

revenues

covering

projects
leased by the Authority to the
Commonwealth, and by the
pledge of all other revenues, rent¬
als and receipts of the Authority.
Among those associated with the
managers in the offering are:
Smith, Barney & Co.; Blyth &
Co.,
Inc.;
Lehman
Brothers;

Phelps, Fenn
& Co.; Eastman,
Dillon, Union Securities & Co.;
B. J. Van Ingen & Co., Inc.; White,
Weld & Co.; A. C. Allyn and Comp a n y,
Incorporated; Hemphill,
Noyes & Co.; Lee Higginson Cor¬
poration;
F.

S. Moseley &

Company,
Biddle

&

Co.; Stroud &
Incorporated; Yarnall,
Co.; Alex. Brown &

Sons; W. E. Hutton & Co.; A. G.
Becker & Co., Inc.; Reynolds &
Co.; Shearson, Hammill & Co.;
Hallgarten & Co.; Schaffer, Necker
Securities

Corpora¬

tion; Schoellkopf, Hutton & Pominformed that he had other funds
eroy, Inc.; Roosevelt & Cross, In¬
for investment and this was taken
corporated; Butcher & Sherrerd;
care of as a routine matter with¬
Schmidt, Roberts & Parke;
out a break in the chain of confi¬
Auchincloss, Parker & Redpath;
dence that had been established
Moore, Leonard & Lynch; J. A.
over the years.
Hogle & Co.; W. H. Newbold's Son
Pew People Expect the Impossible & Co.; Singer, Deane & Scribner;
Green, Ellis & Anderson; Rand
It
is sometimes advisable to in¬

form

your customers
that thpy
should anticipate some losses even
in an investment account. Not all

Co.

&

Ford Motor Stock
Offer Oversubscribed

premium above cost, and although
we may think others know this it
does no harm to bring it to their
attention

without

A

total

common

of

2,000,000

shares

stock of Ford Motor Co.

($5 par value) which are being
purchased from The Ford Foun¬

to

dation

The

know

holding

main

that

will

the security he is
qualify as a sound

and profitable investment, regard¬
less
of
whether
he bought for

speculative

capital

going to bother

an

are

not

informed client

providing he knows that the un¬
derlying basic trend is upward. A
temporary
interruption
in
the
trend

stride,

can

and should be taken

but

if

there

by

is

a

in

serious

new

at

were

offered

on

total

number

of

shares

of

capital stock of all classes of the
company
outstanding. The Ford
Foundation will receive all of the
net

proceeds from the offering.

The

underwriting

group




1929, and from
1934 until 1943
Walter J.

Fitzgerald

associated

was

Ripley & Co. Later he organized
his own municipal bond firm, and
since 1949 has been a partner of

subscriptions in

excess of $25,000, for the savings type of investor.
The commercial banks received allotments of 35% in excess of
$25,000 while all other investors received 20% allotments on sub¬

Blunt Ellis & Simmons.

scriptions in

occasions has served

allotted

on

of $10,000.
of 50%

excess

the

(The $1.5 billion of 4% notes

basis

on

all

subscriptions

in

were

excess

of

President
Club

of

in the
T.

Speculators Chagrined
The

market

action

of the new money raising coupon issues
the Treasury, namely the 10-year 4% bond and
The
10-year 4% bond, according to reports, attracted a certain amount
of speculation since this issue had been selling well above 101
just prior to the announcement by the Treasury that this outstand¬
ing obligation would be reopened for subscription at 100. It was
reasoned by those that are always interested in making a fast
buck, that the 10-year bond would be well taken and should
move up to a level which would carry the quotation of this se¬
curity back in the neighborhood of 101, say at least IOOV2 or 100%.

that

sold by

were

the 4% note was, on the whole, nothing to write home about.

This did not

happen to be the case, and one of the reasons
given for the failure of this issue to hold its price level was that
the allotments of 20% were larger than what was being looked for
by the so-called fast operating group. It was not expected that
the allotments would be in excess of 15%, with some of the opin¬
ion that it would not be more than 10%. When the money market
sensed that the allotments in the 4% bond were likely to be
larger than what had been talked about, there were more sellers
than buyers in the 4s due Oct. 1, 1969 and, as a result, quotations
for this obligation went below the 100 level when the allotments
were made public by the Treasury.

Municipal Bond
Chicago and on several
as

.

office will be Charles

new

formerly with L. F.
Rothschild
&
Co.;
Francis
W.
McGoey, formerly with Goldman,.
Sachs
&
Co., and Richard N.
Strang,
formerly
with Halsey,
Matz,

Stuart & Co.
The

opening of the Chicago of¬

fice represents a major expansion)
for the Pressprich firm since thai
office
for

will

here

be

headquarters-

13-state middlewestern area.

a

The firm is
York

member of the New

a

Exchange

Stock

and

other

exchanges and maintains'
Boston, Phalidelphia,
Francisco and Albany, N. Y.

leading

branches in
San

W. Pressprich & Co.

This year R.

50th Anniver¬

the

will

celebrate

sary

of its founding.
was
organized by

It

his 11 years

experience in the in¬

vestment field.
firm

the

Reginald

1909 following,

Pressprich in

W.

was

In the early years*

principally

derwriter of government,

No Institutional Demand

director

a

Chicago..
4
Associated with Mr. Fitzgerald

notes.

*

He is past

of the

of The Bond Club of

$100,000. In addition, $50 million of the 4% bonds were allotted to
government investment accounts as were $100 million of the 4%

unr-

an

munici¬

pal and railroad securities and its'

Here, we had a situation where a 10-year Government obliga¬
tion this tune was yielding more than 4%, because there is really

clientele largely institutional, but

important investor interest in even medium-term fixed income
bearing issues of the Government.
The Treasury had tried a
long-term 4% bond due 1930, and this issue also went below the

of the New York Stock Exchange*

since

1926 it has

and does

a

been

a

member

comprehensive invest-*

issue

price of 99, for the same reason; the lack of institutional
investor demand for Government securities, and, this is in spite of

ment

the fact that the yields on

ior

turity

is

range,

available in most

Government obligations for a wide ma¬
considerably better than the return which is
of the so-called "blue chip" common stocks.
May 15, 1963 also went under the issue price

of 100, even though it had been fairly generally expected that
allotments would be in the area of 50% which turned out to be

business.

The present

who

was

formerly

Sen¬

S. Lutkins

Partner is Clinton

Senior

Vice-

President and Treasurer of Allied
Chemical & Dye Corporation.

the
the

Nonetheless, it seems as though a four-year Govern¬
obligation yielding 4% or slightly more will sooner or later
than a passing amount of interest for the investor.

here.

case

ment

have

more

Specialists in

More of the Same Issues?

given for the not too enthusiastic reception
is the uncertainty that surrounds
the whole Government fiscal program and the big question mark
as to how the impending refunding and new money raising opera¬
tions of the Treasury will be taken care of.
There is a sizable
Another

reason

U. S. GOVERNMENT

for the recent Treasury financing

that the
be part

of this one too.

and

FEDERAL AGENCY
SECURITIES

is man¬

Loomis, Sayles & Co.

W. K. Pearson Willi

Firsl Maine
PORTLAND,
K.

Treasurer
84

has

Pearson

of

Exchange

Corp.

Maine.—Worsdell
been

First

Maine

elected

Corp.,

Street.

Mr. Pearson has had 35 years

of

Opens Chicago Office
CHICAGO, 111.—Loomis, Sayles
Company, Boston investment
firm, has announced the
opening of a Chicago office at 135

&

counsel
South

La

Salle

St.

Charles M. Kase, previously as¬
experi¬
sociated with the firm's Boston
ence.
For the past 22 years, he
and Milwaukee offices, will be in
has served as Secretary and Treas¬
urer of Institutional Shares,
Ltd. charge of the new office.

financial

of

New

and

and

York,

investment

one

older mutual

of the larger
fund organiza¬

Two With Inv. Service

(Special to The financial Chronicle)
Blyth & Co., Inc.; The tions in the United States.
reversal
then
action should
be First
First Maine Corp., of which for¬
Boston
Corp.;
Goldman,
DENVER, Colo.—Edwin A. San¬
taken and the sooner the better.
Sachs & Co.; Kuhn, Loeb & Co.; mer Maine Governor Burton M.
born and Robert G. Truitt have
There is one thing that custom¬ Lehman Brothers; Merrill Lynch, Cross is President, is engaged in
been added to the staff of Invest¬
ers want above all else and that is Pierce, Fenner & Smith, Inc.; and
the underwriting and distribution
ment Service Co., 916 Broadway.
a knowledge
of investment securities.
that they can rely White, Weld & Co.

aged by:

in

York

New

bills at ah average yield of 3.386% and thus completed the pack¬
age deal that was used to raise $4 billion of new money.
The $500
million of 10-year 4% bonds were allotted on the basis of 65% for

March 31

of 324 underwriters
$56.50 per share.

the

the

Guaranty
Company of

money.

with Harriman

group

a

This offering does not represent
enhancement financing by Ford Motor Co. and
will
not result in any increase in
The in¬

for income purposes.
termediate fluctuations
or

just offered for

career

with

here

of

laboring the
point at issue,
however, is that the client wants

point.

ment

bearing Government obligations
heavy oversub¬

operation coming along in May, and who can say now
four-year 4% notes and the 10-year 4% bonds will not

securities will constantly sell at a

He be¬
his invest-

gan

were

&

Ellis

The Treasury last week sold an issue of $2 billion of 289-day

The 4% note due

American

was

partner ot

cago.

influencing force

& Co.

were

Mr.

Simmons, Chi¬

capital markets.

no

to notify clients

was

A-l

Rated

»<■

very much consideration yet, but the market is very
conscious of its presence and as a result it is an

the

well, dividends were
paid, and the financial reports
favorable.
One day one of the
directors told me he had just had
a talk with the comptroller of the
company
and
the
conversation

ing

coming financing is not

past

Fitzgerald
Blunt

Basis of Allotment

competitive

98.16035

The kind

the

10 years

a

being given

1984-85 maturities. The group was

on

new money needs.

For

The unbalanced budget and inflation fears are still
exacting a toll
in the form of higher rates as far as bond yields are concerned.

prices to
those due

3.70%. for

sale

a

refunding and

scription of the issues which

$30,000,000
The
General
State
Authority of the Commonwealth
of Pennsylvania, tenth series, 6,
2%, 2.90, 3, 3y4, 3.40, 3y2, and
bonds

dent manager.

continues to be limited in spite of reports of the

Co., Harriman Ripley
&
Co.
Incorporated, The First
Boston
Corporation and Kidder,
Peabody & Co. are joint managers
of the group which offered pub¬
licly on March 31 an issue of

recommended

of

of the

care

of securities which will be used for this

&

winner of the issue at

stock

will take

Offered to Investors

serial

with Walter J. Fitzgerald as resi¬

15, 1963, and $2 billion of 289-day
Treasury bills meets its current needs, but gives the money market
only a very short time to digest these issues. The Government
will be back again in the early part of May with
operations that

The demand for fixed income

Pennsylvania Stale
Authority Bonds
Drexel

office at 135 South La Salle Street

notes due May

in the money and

keep him informed after he makes
an investment.
Some years ago I
the

con¬

fidence be retained.

3.60%

CHICAGO, 111. —R. W. Press¬
prich & Co. has opened a Chicagp

The $4 billion of new money which the
Treasury obtained
through the sale of $500 million of 4% bonds due Oct. 1, 1969; $1.5

Correct Mistakes Now
the security
salesman must live with his mis¬

Governments

on

35

R. W. Pressprich & Co.
New Chicago Branch

By JOHN T. CHIPPENDALE, JR.

By JOHN DUTTON

Unlike the Doctor,

(1553)

Atjbrby G. Lanston
6c Co.
INCORPORATED

20 BROAD STREET

NEW YORK
☆

CHICAGO

☆

☆

V
,

BOSTON

34

sults

are

rates

of

necessary if established
improvement are to be

maintained.

price advance, it
possible for such rises to eat
up as much as 10 to 15% of the
increase in gross national prod¬
uct, or account for about $5;25 bil¬
much of

ness

Seaboard Air Line
Seaboard Air Line

A merger of

■With Atlantic Coast Line has in¬

been

have

the

principal factors.
was outbound,
but new industrial plants in the
area served have brought about a
heavier volume of traffic, pro¬

At

one

time traffic

teresting long range possibilities.
are being made of a pos¬
sible
consolidation
of the two
roads. The two roads are parallel viding better utilization of equip¬

Studies

complement
savings

stantial

other

each

in

Unquestionably sub¬

many ways.

could

made

be

through use of joint facilities.
Last year

less

dropped

Seaboard's
than the

revenues

that heavy industry is not as large

the

of

most

of the

one

Maintenance cost and transporta¬

tion expenses were only nominal¬

in its dis¬

first roads

to dieselize and

its yards up to a

also brought

incurred

In 1957

business.

from
a

hurt

by

passenger

small loss was

sustained from this

source

and

a

larger deficit probably was ex¬
ly higher in 1958 despite higher perienced in 1958, on a direct cost
wages. Even with these adverse
basis.
At one time this was a

factors the road was able to re¬

equivalent to
share as compared

income

net

port

$3,11

a common

with

$3.85

share

a

reported

in

1957.

Traffic

i

in

recent

months

has

shown improvement.
Shipments
Oi phosphate rock, paper products
other

manufactured

goods
items have been improving. Fur¬
and

ther

improvement is anticipated.

The

carrier's'

been

trend

revenue

outstanding,

has

the years.

over

Population growth and industrial
expansion in the service territory

Continued from first page

the

bring

profitable

business

for

the

Sea¬

board.

ih

the

offing.

Businessmen

business economists

and

heartened'

are

by the nature of the fourth quar¬
ter 1958 upturn and are finding
positive signs of continued im¬
provement. Yet, the outlook must
be couched in eautious terms be¬
of the volatile nature of

cause

the

many

of

More

and

turns

to

strategic

so

factors.

more
as
the analyst
specific indicators he*
finds a generally improving sit¬
uation, ranging from industrial
production to personal income,
capital
spending,
and
exports.
Encouraging signs are indicated
by, improvements in the average
length of the work week, the in¬

creased orders for durable

goods,
number of new" incorpora¬
tions, and the decline in the dol¬

the

lars involved in business failures.
Let

begin by looking at the

us

total economic picture and

use

the

g:oss national product—the mone¬

tary value of all

the

services marketed—as

goods
a

and

first ap¬

proximation of national economic
well being.. Gross national product
reached

had

a

dollar

high

of

$140.3 billion in 1957, a peak rate
of $455.6 billion having been set
during the third quarter. A de¬
cline set in which reached
of

a

low

$425.8 billion during the first

quarter of 1958.
has

been

rate of about

last

Since then there

improvement

an.

to

a

$453 billion for the

quarter^ The total for the

year

probably will be. about $438 bil¬
lion. The current year should wit¬
ness

with

substantial

a
a

improvement

level of about $473 billion

business
forecaster* is
being
by the increasing availability of

Especially helpful is
published
merce

bv

which

the
now

a

new

series

Department of Com¬
places estimates of

£oss
national
product
on a constant
basis
quarterly
instead
of only dolr

an-

Auaily.




1958

increase

will

reflect

In

spite of this dissipation due
higher prices, the year 1959
probably will be marked by rela¬
tively stable prices in general.
The
dollar, which currently is
to

worth about 48 cents
the

dollar

1939

in terms of

should

to 47 cents.

drop

.

The

no

con¬

Capital expenditures this year
sumer
will be affected little by
not expected to be as high as
changes
in
the
cost
of living
the $14,800,000 of 1958. Cash and
which presently is at 123.8 (1947-9
equivalents at the end of last year
=100).
It
is
unlikely
that this
totaled
$16,800,000
and current
consumer price index will rise by
liabilities were $20,898,000.
Net
more than two points or less than
working capital was $20,898,000 as
1%.
Specifically, the outlook is
compared with $22,232,000 at the
for cheaper prices for most foods,
end of 1957. Depreciation charges
at least the staples of vegetables,
exceed total debt maturing with¬
eggs,
meat,
and
citrus fruits.
in the next year, plus sinking fund
prices
should remain
Clothing
requirements, with some $600,000
relatively stable. Most consumer
to spare.
durables might increase slightly
in price.
Price advances can be
expected for utilities, transporta¬
tion, rents, and medicine as well
are

for state and local taxes.

unlikely
will

that

show

It is

automobile

any

prices
appreciable in¬

crease.

annual' average,

the

for

Most Will Be

segments

Better

of

Off

the

unad¬ will be better off in 1959.

justed for prices increases.

nation
Since

.

high. This industry holds the key
for the prosperity of many other
areas such as steel, glass, rubber,

points above the previous
high of December, 1956. This in¬

in most seg¬
Durable pro¬ 'copper,- zinc,
duction which suffered more rela¬ and lead.
should

occur

ments of the index.

tively in 1958 should make a gain
of about
10%.
The increase in
non-durables

probably
only about half as great.
industries

the

that

and

paper,

One of the most

along with the

sales

in

increase

activity Jn
house
construction.
Textiles, clothing, food and petro¬

leum sales stand to increase
;

v

items should

household equipment

beverages, of about''5%:

Probability of Steel Strike

of
in

substantially

1958, improvement looms for 1959.
Furniture,* appliances, and other

show

chemical,

printing,

goods lines, most

suffered

which

gains include leather, rubber, tex¬
tiles and apparel of about" 10%
food and

aluminum, textiles,

In the soft

will be
Some of

should

1959

Thursday, April 2,

.

.

•

population

significant in¬

- -

as

Expendi¬

advances.

and

recreation

for

tures

leisure,

,

-outlays for resorts, sport"Op¬ inggoods, do-it-yourself, gasoline,
timistically to 1959 is steel;4"This "and transportation, will increase
industry suffered particularly in as consumer income advances. De¬
the first half of 1958, dropped.to
partment stores expect an increase
a
little above 50%
Of capacity. in* sales "of ♦ about 5% and total
This reflected not only the. decline retail
sales should advance by be¬
in industrial production,* but also
tween 7- and 10%; By mid-1959,
the fact that many steel custom-?
retail sales volume should surpass 1
ers
used
their steel inventories
$220 billion.
that

dustries

looks

such

as

forward

rather than to make current .purr
chases. Replenishment of depleted

Even railroading which has not;
shared in the general prosperity.
of the decade is looking forward

"

inventories will help in 1959. Out¬

put for 1958 is estimated at about

*

of utilization for 1959 of about 80.
The industry may be unsettled by
a
summer
strike which is highly

probable.
:>
Construction, another of the key
industries, was one of the sectors
that kept the decline in 1958 from
being more severe.
The total of

increase in carloadings dur¬

to ,an

86,000,000 tons. This is based on
practical capacity of some 140,000,000 tons, giving an overall
utilization of about 62%. For 1959,
output is expected to reach 113,000,000 tons and capacity to rise
by 5,000,000 tons to 145,000,000.
This would result in a percentage

ing 1959. At the present time, rail¬

a

road^-carloadings
about

ahead

7%

are
of the

running,
compa¬

rable 1958

period and for the total'
the gain may be as great as

year

15-20%.
One of the sectors of the econ*

that will not share in the
increasing * activity
of
1959
is.
omy

agriculture. In fact,
10%

to

in

farmer

a

decline up;

cash

,

income,

-

all \ construction

in

1959

reach

$54,000,000,0002

crease

of about 10%

billion of 1958.
all

or

over

Within

might
an

in¬

the $49

the

over¬

of construction, there
is an uneven alignment. Substan¬
tial increases are expected in the
building of stores, roads, bridges,
churches, garages, public utilities,
schools,
and
public
buildings.
However, industrial construction
may decline by about a sixth and
home
building
seems T to
have
reached a-plateau with a.decline
in the offing. > New housing starts
hit 1,200,000 during 1958.
In fact,:
picture

be

may

income

reached

approximately

lion dollars

in

34.5

the best year

—

1951. Production is
crease

in 1059. Cash;
however, had

expected
for
1958,

bil¬
since

expected to in¬
—
poultry,

lines

most

hogs, cattle, wheat, eggs, vege-.
tables, fruits, cotton, and dairy
products. Subsidies will be re¬
duced substantially since the end:
of
the
soil
bank.
Meanwhile,

the

of

prices
farmers

Hence,

can

that

have

we

•

farm income i

on

of between 1 and 3 billion

Now

by;

expected to rise.

s'queeze

a

bought

items

be

dollars.

looked

at

.

salaries and supplements
some
of the specifics' that deter- •
are expected to rise and
mine the scope of national output^ '
Sees Rising GNP Rate
with the cost of living to remain
let us return to the gross national
The first quarter of the year
relatively stable, the outlook is November starts reached a rate of product and review the outlookshould be marked by a general for a
rise in real income.
Wage 1.33 million for a record since for its components for 1959. Since'
all around improvement in most earners
may look forward to av¬
1953.
Total new starts in 1959 the G.N.P. measures the market'
economic indexes, but at a grad¬
erage gains of about 12 cents an should
equal the 1958 rate of 1,- value of all goods end services'
ual and moderate rate.
The im¬
hour, with average factory wages
produced in a year, we may view'
provement should pick up mo¬ to reach about $2.25 an hour in 200,000, but the rate probably will
decline throughout the year to a the components as groups of buy¬
mentum during the second quar¬ contrast
to
the
present
$2.13. low. of
purchases,
gross*
1,000,000 by the end of ers-consumer
ter as businessmen begin to add Workers in certain industries are
1959.
Because
of price
domestic
investmentchanges private
to inventories as a hedge against
guaranteed increases either be¬ and
changes in the type of house :(business spending), purchases by
possible late spring and summer cause of automatic raises or esca¬
built the value of new household
governments, and the net balance'
strikes. By the beginning of the lator clauses. These include auto¬
construction should top $15 bil¬ on the foreign account. We recall
third quarter, GNP should be at
mobile, electrical equipment, air¬ lion in
1959, or a ddllar increase that a gross national product of
a
$465 billion rate.
Because of lines,
and
soft
coal.
Salaried Of some
12% over 1958.
The de¬ $4*73 billion has been estimated
vacations,
strikes,
and
general workers too can expect to benefit
cline in. new housing starts may for 1959.
summer
slowdowns,
the
third as pay cuts are restored.
come from three
sources;" the in¬
quarter might show some decline,
Not only should workers bene¬
creasing cost of new houses; the Sees Increased Business Spending.
to be replaced by
substantially fit because of increased
wages but
tightening
of
credit,
interest rates
Spending by business — gross
new highs during the last quar¬
also because of the expectation of and
down
payments;
and
the private
domestic investment —
ter—with a gross national product
increased total employment and stricter
which
had
reached
a
rate
of
regulations
by
the
Fed¬
rate of between $480-$485 billion
hours worked by those employed. eral National
Mortgage Associa¬ almost 68 billion dollars in 1957
not unlikely at that time.
Civilian employment should ad¬ tion. Federal
Government aid in declined to a level of 54 billion*
It is well to pause ior a moment vance to
nearly 67 million during making home building credit dollars for 1958.
By the end of
and consider the growth, in gross
1959, an increase of slightly under more abundant and less costly
1959, the rate should be up to 65'
national
wages,
thereto

product since 1957.
commonplace to

has become

It

2.5 million from the current level.

as¬

Unemployment, however, will not
drop proportionately.
The pres¬
States should evidence an annual ent 4.0 million
might decline by
rate of growth of approximately but a half a million to 3.5 million.
2.5%, based on historical experi¬ Essentially, this represents the
ences.
If we apply this rate of increase in the labor force as well
expected growth to 1957, the pro¬ as the rapid strides in industrial
jected figure for 1958 should have productivity that enable a given
been some $451 billion.
This ap¬ output to be produced with a re¬
proximates $13 billion more than duced labor force.
Productivity of
the actual figure, or about 3%
industrial plants may be up by as
below the projection.
Using the much as 6-7% in 1959 in contrast
1957 base again, and projecting with a smaller rate
of increase for
the 1959 figure, G.N.P. should be the
economy as a whole.
Hence,
slightly in excess of $462 billion a force tending to generate unem¬
to maintain the long run trend
ployment. ' The smooth flow of
rate of growth. The $473 billion labor income
may be interrupted
of this forecast
thus, is in excess by a series of strikes, with the
sume

of

that the data for the United

the

means

trend.

an

The

forecast

annual rate

of about 3.7%

since

total

of growth

1957, but

improvement of about 8.0%

be¬

the

growth factor

cannot

be

overlooked in national data. Fail¬
ure

to do

easily might mislead
that one year is
preceding year when
actually constantly increasing re¬
one

as

to

good

so

believe
as a

One

of

features

degree

Thus, it is that the importance
of

potentiality in steel constituting
serious and disruptive force.

an

tween 1958 and 1959.

r1 The

helped

of

terms

lar volume of goods.

Most

will characterize the current year,
but that a runaway boom is not

in

about

to

gains in activity and not
merely higher prices for a simi¬

1959 and the Business Cycle
jiearing that an improving and
higher level of economic activity

the

of

most

lower than

Aaalysis and Forecast iu
■

This would

G.N.P.

real nature of the 1959 recovery—

as

*each peaklevels in 1959, or I960.1
More and more evidence is ap-

1959

billion

$468

high degree of real

operating efficiency.
Earnings have been

traffic pattern as
losses
Eastern
carriers.

factor in its

a

lion of the increase.

prices, thereby reducing the per¬
centage gain between the two
ment.
years
from 8.0 to 6.8. This figure,
A large factor in the ability of
we
notice, is very close to the
this road to control expenses has
projected G.N.P.; based on the
been its modernization program
1957 result and the 2V2% growth
over the past few years.
It was
factor. It is important to note the

national trict

average, and were off only 5.3%
under 1957. This reflects the fact

a

is

Chronicle

four

crease

Further, the foregoing data are
based on current prices. Although
it is unlikely that 1959 will wit¬

and

financial

The Commercial and

(1554)

duction.
tion

the

most

expected in
of

a

encouraging
1959

improvement

is

in

the
pro¬

Total industrial produc¬
reach at least
150

should

(1947-49=100) in 1959 averaging
about
25

148.

This would be almost

points above the 1958 low
(April, 1958), 10 points above the
rate for December, 1958, and even

will be

diminished.

1

wellbeing of the construc¬
tion industry has many
repercus¬
sions

on

the welfare of the nation 1

Not

only is a large bloc of labor
employed in construction,but new
housing means increased demand
for
many
building
materials,
household appliances and; furnish¬
ings, and consumer durables.
Automobile production is. an¬
the fundamental, indus¬

other of
tries

that

stantial

looks forward to

improvement

Domestic sales in 1958
to about

in
were

4,300,000 which

sub¬

1959.
down

was some

billion.

66

or

The

sector

The

G.N.P.

of

drop in this
responsible"

was

for initiating most of

the 1958

re¬

cessionary influences.. With busi¬
declining and profit expec¬

ness

pessimistic early in .1953,
firms decided to live off
inventories for as long as

tations
many

their

possible and to curtail outlays for'
new plants and equipment From'
an

increase of

billion dollars

a

in;

1957, inventories declined some $£
billion in 1958. The prospect is;
that
inventory buiid" up likely,
renewed

will

be

and

second quarters of 1959. For

during the first;

3,700,000 below the 1955 peak. In

the year

inventory buildups could

fact

account

for

anything under 6,000,000 units
today is considered .below the
norm for the industry. Plans for
1959

look

towards

domestic sales

3-4

billion

almost 5

an

increase of

or

a

net

some

charge

of

billion dollars.

*

Business spending in new plant'
of about 5,500,000. Efforts also will, and
equipment also declined sub-;
be launched to recapture some of
stantially in 1958. The decline in

the 500,000 market now accounted

purchases of producer goods—the
items that are used to produce,
— receded
by almost
stable for new automobiles. Sales 20% in 1958. This type of spend¬
of hsed cars, also should remain
ing dipped from a peak rate of
for

by foreign models.. Prices, in
general, should remain relatively

2 About

$36 billion in private and $18

billion in public construction.

other goods

almost

38

dollars in 1957,
of about $31 billion

billion

to an average

1958,

for

with

.

.

The Commercial and Financial Chronicle

.

below

level

a

about

30

urated.

population

Unemployment will con¬
tinue as a drag on the economy.

£*?«£
improvement in C.N.P. It
likely that gross national prod-

Then, too, there is the matter of
Federal
Reserve
Policy. Injudi¬
cious action easily may introduce

uct would need to be

of such outlays. The drop
was- one
of
the. major

stabilizing force
lhat will keep consumer spending
from declining as much as other

behind

components

1957-58

influences.

sionary

The

viewed

as

000)

inventories

one

the

of

Peak

boom

attained

will

until

,

this

of' the

!

present.

-

••

-

I

-

established

about

a

record

new

the

fiscal

year

1959,

ending

30,1959. It is the President's
year

will show

local

outlays in this picture.
purchases
of
goods
and

note ' that

•

items that affect the
total national production are in¬
cluded iiij the former, but transfer
payments are added to the latter.
Governmental outlays stimulate
both the consumer and business
*

sectors

of

the

they
enhance payrolls, create demands

of

for .the

crease.

it not for the decline dur¬

as

products of munitions and
industries

construction

total would have been much high¬

economy

and-

in¬

the sales of miscellaneous

local

suppliers of. governments.
Outlays Ton schools, streets and

ing the first two quarters of 1958.
For
1959,
these
expenditures
should reach approximately 308

and

Governors

of

System

is

Reserve

Federal
to

(All Prices

Consumption

banks

have

There

is

that

reserves.

little

little

of demand against scarce
If prices are bid up, this
caused more by a psycho¬

will be

logical feeling that inflation is
coming rather than as a result of
the interaction of basic economic
forces.

•

been

tion

in

with

it

to

To begin
to correct a
that a mere rise

recent
is

years.

necessary

fallacy

common

in

;

stop and inquire
the American economy
characterized by infla¬

whether
has

/

-

well

is

It

prices constitutes an inflation.

Inflation is

a

characterize
ary

relative concept.

a

goods industries. A favorable fac¬
in

tor

been

consumer

the

spending

diminished

has

Teliance

on

installment buying which reached
record of over 34 billion dollars

a

period

as

in .1957. Net repayments
to

over

There

a

billion

probably

crease-in

this

amounted

dollars

will
type

be
of




in

1958.

Producer's

(New)
Equipment

Government

Purchases

Services

State
Net

—

an

debt

in¬
of

Disposable Personal
Personal

only price levels but other quan¬
titative
measures
such as gross

product, disposable per¬
sonal income, supply of money,
and
the
like.
Adjustments also
must be made for rates of growth.

national

not taken into

valuable tools for economic anal¬

It is not enough to point to

ysis.

product

national

gross

and

measures

indicate

or

like

that

they

are

many

so

below

last

percentage

year

*<

4^0

V

52.0

economic

of

istics similar to 1958.

Emphasizes Economic Problem of
Stability
,T

..

,

been

...

...

the specifics
otothe
for
1959
have

f

k
business

forecast

reviewed,

attention

to

let

some

turn

us

of the

the

serious

question that stems
price problem is whether

328.0

21.0

'

22.0

133

148

obviously

must

slow

.For reasons explained herein, only government, can expand
up.

cycles centers around
the problem of stabilizing business activity.
There is little doubt
that
the problem of stabilizing
business
most

activity

important

lems and

one

is

one

economic

declines

from

fjrst approximation, ecoactivity may be viewed as
consisting of a .circular flow in,
a

nomic

(iabor, capital, natural resources
management) flow into the
productive process, where they
are
converted
into
goods
and
an(j

services. These goods^and services
in ^urn ^ow t>ac^: *°
owners °*
the

materials and .others in

raw

their role as consumers,
closng the circle,
.

.

thus
_

.

•

The objective of business cycle

control.is to maintain business
activity always on a high enough
level to produce the optimum of
economic prosperity thug avoidr
in£

and busts

turning

creasing productivity of industry
thereby to generate a constantly
growing demand for goods and
services sufficient at all times to

of the critical points

in the American economic system,
The responsibility for keeping

economic

stances for the purpose of off-"
setting the slowdown in business'
until the economy grows enough
to again become self-supporting.

wlc*e fluctuations—booms
that have been so devir^
? accomPhsh this in a period of growing
population and increasing proof the ductivity such as the present;
prob- there must be a constantly in-

of industrial fluctuations

area

and business

shared

employ the growing labor force

all—government, consumers,
business, labor, agriculture; each
sector can make a particular con-

aric* ay_ ather agents of-production. Unfortunately, the pattern

stabiliza-

to, the above requirement; henc0
the ups and downs that shape the

variations in employment
production which produce the
in the business cycle

business cycle. The causes.of thq
departures of the usual pattern of
demand from the ideal Pattern
are generally understood but difficult to correct; human psychol°gy is a big factor. ,A look into
the sources of demand and their
contributions and limitations will
throw light on the subject,

into

severe

recessions

is

by

tribution

to

economic

tion.
The
and

fluctuations
due

lack of coproduction
and utilization, both in consumer
and capital goods, which, in periods of business optimism, results
in
over-production and overbuilding,
financed
largely
by
are

primarily to

ordination

a

between

and
started

vate investment are curtailed,

services is oversold and

A

311.0

-

down until market demands catch

our
broader

underlying philosophical implications that must be given full consideration when analyzing business prospects.
Much interest in

of the economy.

from the

305.1

1.0-

which the economic raw materials

gross

cess

rate.

dis¬

375.0

national product m
$500 billion. The year 1961
becomes another year of decision
which may show many charactera

erate

easily

1.0
354.0

its demands under these circum-

thereby.

Achieving Full Employment

3.5
347.9

activity

V

99.0

,

57.0

40.0

growth but with no boom and
bust potential for the year. In fact
most signs indicate gradual increase through 1959 with substantially new highs appearing in
1960. By 1960, the nation should
be faced with a year of general
optimism and expansion and with

cal product of only about 1%, be¬
low the established rate of growth

increases, thus

93.0

53.0

36.3

or

price

87.1

50.8

20.7

tinue

a

\

68.0

26.5

143

business

to

due

148.0'
118.0

23.0

Income

sound

*

*

53.5

—5.5

note that most
indicators point to the fact
genuine recovery is under
by

308 0
42.0

1.0

Savings

marked

'

27.8

a

way

-

$473.0

37.5

In summary, we

key

(Projected)

291.0

142.0

Industrial Production

that

1959

112.0

_

true increase in physi¬

mechanism,

be

..

36.0

Income

leaving

logical

an

Dollars)

65.3

Foreign Investment-

Personal

was

timp as a modification of this

5%

Goods

of

Local

and

the expecta¬
the average will con¬
to rise, but at a more mod¬

this

to

wiu

...

37.0

__—_—_____—

Federal

tion is that

generally optimistic forecast. The
American economy is a psycho¬

increase

$438.0

106.5

36.5

and

of

$440.3
284.4

To

inflation¬

Billions

____________H38.0

For the current year

A word of caution is in order at

of
4.5

table

7.

,

1938

39.9

—

Construction

it is necessary to examine not

Were those factors

___

Inventory

reason,

pressure
•

Current

..

.

.

(Estimated)

Gross Private Domestic Investment

free

however, to expect any serious
price upheavals. Unlike other pe¬
riods
of
prosperity in the post
World War II period, there is no
goods.

in

points
over-extension of credit.
another peak
learned
There is no direct cause and efby' businessmen during
siderably.
/
v-"year.: Only to keep even with the
the recession. In fact, higher prof¬
feet relation, however, either beAn idea as to the significance
past is to fall behind since there
its
are
tween the volume of goods conbeing earned by many con¬ is a rate of
of increase in disposable personal
growth that also must
sumed
and
that
produced
or
income may be glimpsed from the cerns now. at lesser rates of opera¬
be
considered.
For example, if
tion than in previous years.'
between
the volume of savings
I
GiN.P. were $430 billion in one
following calculation. It is reason¬
available for investment and the
As profit expectations increase
ably safe to assume that out of a
year,
just to sustain the estab¬
demands of the economy for inthere will be an additional incen¬ lished rate of
dollar of
increased
income, the
growth of between
vestment funds.
The degree of
typical consumer will pay ten tive to investment in hew plant 2V2
and
3%
would require
a
and
equipment. Likewise, divi¬ G-N.P. for the next year of be¬ correlation between production
cents in taxes, save ten cents, and
dend
payments
should
be
in¬ tween $441 and $443 billion to and consumption depends upon the
spend eighty cents on consumer
creased by above a billion dollars maintain an even keel. Changes in ability of business managements
outlays.. Thus, if personal dispos¬
over
the
1958
level
of
approxi¬ prices, too, must be given full to forecast future demands. Overable income rises by fifteen bil¬
mately $12.5 billion. It is likely consideration.
lion dollars, this would mean an
For example,
al¬ production and over-building exthat
the - stock.. markets
already though the dollar value, in cur¬ pand business activity while in
increase of 1.5 billion dollars in
progress, but obviously must be
savings and of 1.5 billion dollars have reflected the improved profit rent dollars, of the gross national
in
taxes and
advanced some 5%
in followed by a corrective period
a
stimulant of 12„ prospects., The Dow-Jones aver¬ product
age showed a 30% gain for 1958. 1957, approximately 80% of this during which production and pribillion dollars for the consumer

increase will help retail trade con¬

,

1957

Expenditures—

Non-Durable

the scope
of its powers.
leaning is toward tight money
this is especially significant

now

Are

Gross National Product—

a

,

may be attributed to the lessons
in cost .reductions and economies

.

(Actual)

0

Component—

policy of halting
inflation as is possible

much

as

of

Board

.

approximately. 328 billion dol¬
lars, .for. an increase of approxi¬
mately f 5 billion over .1958. This

fonowlng
,

em-

Services

^

to

level of full

a

.

.

rate

about

of the past.

Monetary

other

would* surpass, the former high of
$45.5;billion of 1956. A significant
portion of this increase in profits

The

nearer

that

consideration, it would be possible
to describe even some of the most
public works will continue
devastating depression years of
by state,arid local units.
the 1930's as inflationary by using
pillion dollars... The consumer al¬
Som<r improvement in the ex¬ a base far
ready ; is
evidencing a greater
enough removed dur¬
willingness, to
spend
for
such port picture can be expected dur¬ ing which prices were lower, such
ing the year. A" rise to about as some nineteenth century pe¬
items as automobiles, household
goods, appliances, television sets,-' twenty, billion dollars in exports riod, for example, 1890.
travel, rents, clothing, eating out, is possible, /this will still be about
That such comparisons are es¬
five per cent below the 1957 level.
and medical care.
sential is self-evident if for no
The willingness to spend is re¬ Imports might rise a billion dol¬
other reason than the number of
lated directly 'to an expected in¬ lars to »a; level of 14 billion.'This
welfare or value connotations at¬
will depend solely on tariff ■ ma¬
crease
in personal income. One
tached to the idea of •"inflation."
anomaly of 1958 has been the nipulations".
Thus if certain public policies are
Business,prof its can be expected
continued advancq in personal in¬
to be called into play when an
to show substantial improvement
come
to Miew
high .grounds in
inflationary period is present, and
throughout
•
the
;year.,'
Corporate
spite of increased unemployment
correspondingly if certain vested
profits after taxes might reach a interests are to be affected favor¬
and shorter .work weeks. The.. in¬
level of about 25 billion dollars as
crease
in personal income should
ably or adversely, it is imperative
continue and may reach as high as compared" with approximately 18 that the period be truly inflation¬
1958.
This
means
a
$375 billion in .1959, representing billion .in
ary and not just a surface emana¬
ap .increase of; some; 20
billion .before tax profit of about $48 bil¬ tion of higher prices.
over
1958. Disposable income — lion in. L959 in contrast to abopt
Perspective and hindsight are
that remaining to persons after 37 billion dollars for 1958. This
paying taxes—ralso should advance

of

easily could generate
upward price movement.

be reduced to

us to

,

these

only

annual

an

G.N.P.

m highlighting the predictions for 1959 with the record

be tightened unneces¬

brings

the

that

in 1957. A level

one

in

$500
billion if unemployment were to

the question of
inflation and monetary policy for
1959.
The general
indication is

and

purchases of goods and services
by governments differ from gov¬
ernmental spending
totals since

,

This

The

Itis Important ~ to

^$297 billion for 1958. The

er; were

under,

mean

is

Policy

dollars

billion

services-account for about 40-45%
of the total public sector, or about
40-45. billion dollars in 1959.
" _; ,

Consumption
expenditures —
spending by the people—has been
one
sector of the economy that
buoyed up much of business dur¬
ing 1958 and prevented the de¬
cline
from
going further.' Con¬
sumer outlays which had reached
a .peak of 287.2
billion dollars in
1957

decline, rising to
93

$88 billion

Their

-

,

1958

seems

Durables

within

the

of

this

sarily.

the

balance. One must not, overlook,
however the importance of state

-

Increased Consumer Spending

the

constantly

a

demon¬

area

From

for

opened.

hope that the next

a

much

too

all

for

be

restricted

committed

June

ba¬

not

life

a

with full

cautionary element at a strate¬
gically inopportune time. There
is the danger that credit may be

Spending by all units of govern¬
ment has gone on rising during

business " sentiment.. and
levels

markets
of

billion dollars has been estimated

full feeling of optimism,
rathei* than the cautious optimism

strates

being

evidence.

less
new

hundred billion
dollars can be expected in 1959.
A federal budgetary deficit of 12.2

will
being

sensitive

in

essentials

just

economy

most

of

rometers

the

be

force,

from

be looked for in the current year.

Watching/ it

be expected in 1959,
recessionary influences
curtail marriages and births
can

approximately

in this segment of spending to
of about $32.5 billion can
of

net

a

the

a

Discusses Anti-Inflation

are

rate

careful

1957, the pop¬

and there

the

basic

-

showed

percentage

3,000,000

this

be expected for 1959. A pick¬

sector

A1-

G.N.P.

there were about 70,000
marriages and 45,000 fewer

will

also

Now, with the inventory pic¬
ture
improved
and
industrial
activity
on
the
way
up,
an
increase in
capital expenditures

bear

the

interrupt

money may

that

being

This

of

a

of

high

a

could

swing. Industry still has

gain
of
about 2,750,000 in 1958. An addi¬
tional
gain
of
approximately
since

cut. Hence, two sig¬
recessionary
influences
joined hands to generate*a busi¬

up

rate

as

that

forces

upward

capacity

births in 1958 than

nificant

decline.

the

act

ulation

optimistic decisions of 1955-1957
leading to extra capacity were
coming to fruition. Faced with
declining markets and increased
costs, many companies cut their
capital outlays drastically. Coincidentally this took place at the
that

miscellaneous

ihough
fewer

riod during which time the over-

time

and

growth

of digestion pe¬

sort

a

and *

size
of
the
population
(currently estimated at 175,000,-

1957-58

in capital outlays may be

goods, automobiles,

The,

reces¬

decline

pur¬

household goods.

in

the

of hard

appliance,

to

in: 1958

a

stable

1959, and this in spite of the sub-

effects

can

numerous

danger of markets becoming sat¬

rise

a

chase

capital spending
is
one
of the most encouraging
notes for 1959. This is especially
so
because
of
the
multiplying

ness

are

which

of

dollars. The expected

improvement

were

there

And

3.5 million will be unemployed in

particularly to facilitate the

quarter.
1959 is ex¬

experience

billion

same

turbed.

35

of unutilized
always is the

last

the

quarter

to

pected

forces

billion dollars in 1959,

two

(1555)

ployment, something closer to 2,000,000 unemployed. This would1

during

first

30.5

5834

price level is compatible
employment. At present,
unlikely. As indicated
earlier, it is estimated that some

billion
The

Number

189

Volume

recession

is

pf l?*3* demand does.not conform

There are three main sources of
utilization of goods and services

goods and
industrial

vestment.

consumption and pri-*
vafe investment are responsive tq

production programs of busi-f
management and are limited
by ec0nomic considerations asso?
the

ness

ciated with maintaining sound re^

iationships between income and
expenditures. Government, how-r

technically is free from such
restraint, and may regulate its demand with or without
regard for the overall business
ever,

economic

situation^—and

even

deficit when

create

a

fbr

government

management believes this to be in
public interest,

the

The
Qn

use

of credit, based

savjngs

and

primarloans,

bank

1

and

of business

»

Personal

capacity has become excessive —
both of which conditions developed in the latter part of 1957

they

personal consumption; gross
private domestic investment andi
government purchases. An added
minor element is net foreign inare

nancial

When the market for

most of 1958—the rate

which demand stems;

from

^

*

Continued on page 00

36

The Commercial and Financial Chronicle

(1556)

timing and techniques,

Continued from page 35

sulfur

but these
;

insurmountable.

not

are

1

lose

increasingly significant factor
in
determining the overall
demand
for
personal consumption and private investment because it produces immediate additional
buying power for the
borrower.
Thus, when outstanding credit is increasing, buying
power —and hence
demand for
production—is increased and business activity is stimulated.
However, cause and effect must not be
an

confused.

There must be

suffi-

a

l'or

producers having been in the business
initiative now," the magazine says.

future

fractional reserve requirements.

of

The total demand for goods and

and

consumers

ing. Both stimulate business by
increasing the excess of government expenditures over revenues,

age of the gross

business—has become

factor of

a

constantly growing importance in

indicates

the

of

national
especially
since
1954.
1946 private debt was

expansion

product,
Thus, in
°f

gross

.f oss
national product;
had risen to

by 1956 it
During the

93.5/c.

doubt

to

78%

of

product.

national

gross

'

«

support

buying

public

works

grams,

borrowing

as

fr0m

essary
(

Th

meni

the

of

involves

ad-

steep

some
uncertainty
private investment
credit will produce

demand

necessary

for

pro-

during the next

a continuation of the present trend up\ygrd to give
full employment.
Although gross national product

will increase during the next five
and ten years, it is the writer's

an

fear

that

fuU

employment

not be achieved

complicated problems of

———————

will

same

five years or longer for

nec-

such

be

increased

duction

the Federal govern-

execution

to

to whether

and consumer

pro-

if

it

further along the

trend

as

ex^nd their

funds

whether

to

as

vance

appears

eytnnd their

construction

decreasing pereentnational product,
slowing down in the
a

will

short of instabil-

ity.

—

Continued

purchases by
over-expansion of
commercial and in¬

extension

and

for

over¬

of

capital spending by
business, thus anticipating future
growth of income and demand for
production.

The

final

result

of

euch over-expansion

inevitably is
falling off of demand for con¬

page

stimulated

credit"

gages on
also built

the

"easy
especially for

purchases

and

homes.

new

up

and

small way

no

by

available,

installment

services

mort¬

Business

unusually large

an

volume of bank loans
during this

The State oi Trade and

Industry

schools and public buildings.

Increases were reported for stores,
factories, hospitals and social and recreational buildings.

Residential building contracts inn
February were $1,073,077,000, up 48% over last year. All residential categories, without
exception, were up.
v W
'

systems down and all other major types up.
Cumulative totals for the first two months of
1959, with the
percentage changes from the corresponding period of last
year,
were as follows:
Non-residential building,

$1,521,120,OOOj

1%;
residential building,
$2,091,220,000, up 39%; heavy engineering,
$1,009,049,000, unchanged; and total construction $4,621,389,000,
up 15%.

period.
Over-expansion in some
lines continues to be a problem
even

today, in spite of

New

At the present
time, approxi¬
mately two-thirds of the available

labor force produces most of the
requirements for personal con¬

the

remaining
onethird can obtain employment
only
from private investment and
gov¬
ernment.

Since

the

multiplier

nant

extent,

principle

variation

cause

are

limited by economic
are

This

produce ups and downs in
business activity, business stabil¬

ity necessitates
that

third

a

can

source

adjust its
in times

quirements—except

of
re¬

of

national emergency—so as to off¬
set or
balance the fluctuations

Federal Government.

contribution

of

toward resistance to

promotion of
d

amount

a

The amount

government
a

decline

by

which

exceed revenues.

other

vide

an

down

season¬

the

at

came

to

16.0% from the prior month's all-time high of
50.6% higher than the 10,466 of
February, 1958.

Charters for the first two months of this
year totaled 34,523.
was 46.6%
above the 23,546 of the

Graw-Hill

by

the

expenditures

This deficit may

obligations
investment

which
channel




pro¬

for,

said

resistance

some

field day in the tight Ameri¬

a

"The

"Iron
due

market,

Iron

Age,"

Age," steel

to

(1)

the

national metal-

imports

lateness

run¬

are

oi

delivery
which are in

those products

/

in

the

red-hot

midwestern

foreign steel buying

may hit a record high during the
Most of this steel is being offered for
May, June, and

volume

this

week.

"
S.

''-'v;-;

;

■

mills

report

It explained this

easing

an

is not due

to

in
a

v-'y

.

order

new

lack

of

de¬

mand, but simply an indication that steel users now know what
they will get or won't get before June 30, possible steel strike
deadline.
Some
metal working plants
are
not getting enough steel.
They are pressing the mills for quick delivery on the ground
they are using more steel than they had expected, and are in
danger of running short.
"This group is small," said "Iron Age," "but as one
producer
points out, a shortage among as little as 5% of a customer list
create

can

a

lot of

noise.

"The only way a mill can meet unexpected and urgent needs

is

by pushing someone else down the ladder. There is no sign
this is happening to an extent that will really hurt many
people, but there is a chance of a chain reaction." If unexpected
demand hits on top of lagging delivery performance there could
that

be problems."
"Iron Age"

points to the railroad market

as an example of
probably sustained demand.
The railroads
hard, in the steel market. It is estimated
10,000 freight cars were ordered in March. Feeling is, another big
car-building program is underway.
Ond source estimates back¬
logs will hit 75,000 cars by the end of the year.
an

unexpected

have

and

back late, but

come

Despite the tight market, mills are doing
taining delivery promises.
Most are only
scheduled deliveries.
Then

shipments

some

customers may

are

good job of main¬
week behind on
case by mid-May.
expected to lag by two-to-three weeks, and
not receive shipments scheduled for the last
But this will not be

a
a

the

Steel producers made almost a third less
than in the previous year, "Steel" magazine
The

than

the

industry's net profit

comparable period last
24,178 of the 1957 January-

Facing Rising Foreign Competition

was

below the $1.19 billion of 1957.

estimated at $817.2 million, 31%
The metalworking weekly based

this

estimate on the performance of 33 leading steel companies
accounting for 94% of U. S. steelmaking capacity.
Total

net income for the 33 companies was $769.4 million,
string of three years in which they netted over $1 billion.
Out of every sales dollar, 6.36 cents was kept as net profit, the
lowest figure since 1954. 1957 net income was $1.12 billion.

ending

a

But

Uncle

these

if

Sam's.

again the

steelmakers'

Federal

lowest

since

matched company

Nearly
companies.

earnings

income

1954.

taxes

But

t\/tv,

Mexico, Canada and France, meanwhile, each increased their
ten-fold or more during the same period.
Mexico

slipped last year, so did
34% to $721.9 million,

fell

aollar-for-dollar, taxes almost

profits.

million people owned shares in these 33 selected
Common stockholders numbered 835,864 in 1958, vs.
857,465 in 1957. There were 112,385 preferred stockholders in 1958,
vs. 114,904 in 1957.
a

Steel Inventory
users

them over

rent operations are taking
are

1

Buildup Falters

having difficulty building

up inventories to
the anticipated summer steel strike because cur-r
are

incoming steel shipments

received, "Steel" magazine said

on

as

fast

as

they

March 30.

Mill spokesmen predict the inventory accumulation by July
will be substantially less than consumers planned, the metal-

working j/eekly reported.
Most sheet mills
ducer has refused

are

more

the last few weeks.

booked solid for the first half.
than 60,000 tons of

than anticipated.
rush

of

One pro¬

flat-rolled business in

Some have had to close their books earlier

\
consumers

to

get

orderly fashion by both mills and

publication.

net income in 1958

reported.

steel
users.

J

is being handled in an
In spite of the demand,

there is little friction between buyers and

sellers this year. Steel¬
credit for the handling of orders
than for the production records they've set.

makers

probably deserve

more

Steelmakers operated their furnaces at 93% of capacity last
Production was at a record level of 2,633,000 net tons of

week.

steel for ingots and castings.
The scrap market is weak even though mills are producing
steel than ever before. "Steel's" composite on No. 1 heavy

more

melting

production

scrap dropped to $39.33
preceding week.

went from 107,000 tons in 1954 to
1,250,000 tons last year, Canada
from 20,000 to 200,000 tons and France from
4,000 to 135,000 tons.

The fact that mills are using more hot metal, home
scrap, and
metal returned by customers poses a troublesome problem for the

And while 1954 exports

by these countries

were

almost

non¬

existent,

the magazine estimates Mexico will export between
1.1 million and 1.3 million tons and
France 400,000 to 500,000 tons
of sulfur during 1959. This
compares with expected U. S. exports
the 1.4 to 1.5 million range.

tion of sulfur in
many countries

metal

as

a

sulfur

produc¬

by-product of oil refining,,

brighter side,

demand

at

says

the magazine, is the strengthening

home and

abroad

as

continues along with the
development of
.

increased

smelting and other industries.

On the
of

Both factors

will

million tons this year.

cause

a

scrap

the

business

recovery

markets.

new

jump in world needs of about

1.5

'

Also encouraging is the
long experience of U. S. sulfur pro¬
ducers as the^dominating force in the field.
"Let's figure on our

a

gross

ton, off $2.34 from the

industry.

With

a

limited home market, interest in scrap exports is high.

Three cargoes will leave Philadelphia
Most of it headed for Japan.
Seattle

yards are

Another factor in the competition is the

or

be financed by the sale of bonds
or

were

Rising sulfur production in countries where little existed
three years ago is challenging the U. S.
sulfur industry with ever-

recovery is meas-

approximately

time,

same

July delivery.
"Iron Age" said U.

The

his is
Produced
by privatemainly
industry.
government,
the

u r e

was

U. S. Sulfur

in

Of

down

was

were

The total

year, and 42.8% higher
February period.

re¬

such

to

demand

February

Where the U. S. turned out
5,938,000 long tons of the world's
total elemental sulfur production of
6,936,6000 tons in 1954, its
share slipped to 5,274,000 out of the
7,900,000-ton world total
in 1958.
*

straints, and fluctuations
Os

into

first half.

tide

in

for most of the fluctua¬

Since the demands for
personal
•consumption and private invest¬
ment

chartered

stiffening competition,

tions in the business cycle.

the

Steel

employment of this
that is the "mechani¬

in

one-third
cal"

domi¬

record.

18,765, but

affects
a

find that it is the

we

level

influence of

business activity to such

up

highest level for any Feb¬
15,758, exceeding the previ¬
Febraury record of 12,503, set in 1956 by 26.0%. The current

ous

sumption;

businesses

ally from January, but
ruary on

Singles Out One-Third Labor

the

ning

having

promises, and (2) price increases in
shortest supply.
Still, it's already apparent that

February New Business Incorporations at Record

series of

a

cut-backs since early 1957.

to

"Steel's" 34th Annual Steel Industry Analysis

and power

and

long

4

boom of 1955-56 in

goods

too

half of June.

from

private investment, and a corre¬
sponding reduction
in
business
activity
and
employment.
The
was

At

——___—___—

February heavy engineering contracts amounted to $529,623,000, up 11% above the corresponding month of last year.
Within the category, public works contracts were
up 13%, with
gains in all types including highways, bridges and
sewerage
systems. Contracts for utilities rose by 8%, with electric
light

sumer

far

Reaching Record Proportions

are

market, according to
weekly.

working

excessive

residential,
dustrial building,

a

steel

can

to

power

consumers, for

.

n

is

Foreign steel mills

.

Available credit may—and often

does—produce

'

investment

in the recent past.
Under these conditions, there

ine execution oi sucn an
debt—Federal, extended public works program

period, however,

same

total government
Ctate and local-went down from

133%

nl

t

rn

private

rapidly that there is considerable

State and focal

governments also can

ali¬

annual rate of private investment,
Consumer
credit
has
risen
so

capable of exerting the
influence
on
trend of

bUSineSS activity

for

furnishing

means

greatest

been

gether with the fact that the demand

private debt— the

both

have

demands

services may be increased by tax
reduction and/or increased spend-

;

of

goods, such as was
at the end of World War

ticipated and filled. Productive
capacity of industry recently has
been expanding more rapidly than
demands for production, so that
present producing capacity to
SOme extent anticipates future requirements; this condition,
to-

—

debt

Steel Imports
1955-1956,

II, and it appears that even some

funds becoming available because
of a decrease in private investment, by means of an expansion
of note issue, or through borrowing
from
banking
institutions,
thereby increasing the volume of
money through the operation of

—

The creation

of

consumer

built up

ciently attractive marginal efficiency of capital (for the business Reduction in taxes releases addiJoan) or marginal utility of goods tional buying power to consumers
(for consumer loans) to induce and private investment; additional
the borrowing.
When outstanding
spending by government for goods
credit is decreasing, buying power
aiKj
services
increases
employand
hence
demand
is
dement directly. It is believed that
creased and business becomes dean
increase in spending for the
pressed.
:
j
'
construction of public works is
the

boom

there is little accumulated demand

1959 and the Business Cycle
is

the

After

Thursday, April 2, 1959

.

.

the

A Look Ahead

Analysis and Forecast foi

.

within the next six weeks.
and San Francisco scrap¬
also negotiating for Japanese requirements.

Already alarmed by foreign steelmakers' sales in the U. S.,
even stiffer competition when the St. Law¬

American mills fear

Seaway opens.
warehouse underbid a
rence

structurals

Here's why: Using foreign steel, a Detroit
big U. S. mill on 200,000 tons of bars and
for municipal projects in the Detroit area.

"Steel's"
industrial production index for the latest week
equaled the all-time high set in the first three weeks of Decem¬

ber, 1956. For the first time in several weeks, steel output played
a
relatively minor role in the uptrend. Steady improvement of
electricity output, automobile assemblies, and freight carloadings
pushed the index up. Records will be set in the next few Weeks.
The proposal to build an ore

carrying

the Cuyahoga River at Cleveland

can

belt to bypass
$35 million in hard-

conveyor

mean

Volume

ware

Number 5834

189

>:contracts*, to .the

.

.

.

The Commercial and Financial Chronicle

conveyor

industry.

Lake carriers

can

save

on

Uptrend

of ingot and steel castings

duction for 1947-49)

(based on average weekly pro¬
compared with an actual rate of *163.8%

as

capacity and 2,631,000 tons a week ago.
Actual output for March 23 week was equal to 92.9% of the
utilization of the Jan. 1, 1959 annual capacity of 147,633,670 net
tons. Estimated percentage for the week of March 30 is 93.7%.
A month ago the operating rate was *159.1% and production

of

2,556,000 tons. A year ago the actual weekly production
placed at 1,312,000 tons, or 81.7%.
*Index of

production is based

for 1947-1949.

'

7'^7'W 7

on

■;

March Auto Sales May

Liabilities in

Manufacturing,

The American Iron and Steel Institute announced that the
operating rate of steel companies will average *165.2% of steel
capacity tor the week beginning March 30, equivalent to 2,653,000
tons

of 1958.

the week's failures

$1.8 million a year by eliminating the river trip.

Steel Production Continues

(1557)

average

was

weekly production

excess

of

against 25

$100,000
a

were

incurred by 42 of

Week earlier.

up

Electric

many

a

to

North

concerns

reported week-to-week rises.

The

toll in

the

42;

moderate

Following two successive weeks of increases, the Wholesale
Index, compiled by Dun & Bradstreet, Inc., remained
unchanged in the latest week. At $6.19 on March 24, it was down
<.6% from the $6.70 for the comparable date a
year ago.

observers, but was well distributed by make and by
manufacturer. Indicated is a tenor of buying that should give the

represents the sum total of the price per pound
foodstuffs and meats in general use. It is not a cost-of-

raw

Commodity Price Index Hits New 1959 High
Higher prices on hogs, grains, rubber, flour, and lard
helped
boost the general commodity
price level to the highest level so far
this year.
The Daily Wholesale Commodity Price
Index, com¬
piled by Dun & Bradstreet, Inc., rose to a 1959 record of 279.66 on
March 30 from 278.18

a week
earlier, but remained slightly below
the 279.73 of the similar date a
year ago.
Reflecting a rise in both domestic and export buying, wheat
prices moved up appreciably this
week; wheat

bly cutbacks prompted by new car inventory adjustments.
"Ward's" estimated output at 122,714 automobiles, 9.4% below
preceding week (135,466) and the smallest count since Feb. 16-21
(120,780). Trucks were programmed at 25,185 units, 2.8% fewer
than earlier week (25,907), which was the best volume of 1959 to

receipts in

Chicago

27—19.2%. Two of the company's assembly

plants were idle all week. Los Angeles was down while engineers
realigned facilities hi order to integrate Ford and Mercury assem¬
bly operations. Previously, only Mercurys have been made there.
Mercury's St. Louis unit halted all week because of inventory

American Motors, 17%;

bly plants, two Chevrolet units and Buick's Michigan facility on
four-day schedules the past week in a move to reduce new car
supplies in various parts of the nation.

Again Below Previous Week
electric light

and power industry for the week ended Saturday, March
estimated at 12,709,000,000 kwh., according to the Edison

28, was
Electric
Institute. Output the past week was below the level of the pre¬
ceding week and marked the second successive weekly decline.
For the week ended March 28 output declined by 191,000,000
kwh. below that of the previous week, but showed a gain of
1,064,000,000 kwh. or 9.1% above that of the comparable 1958 week.

Loadings 13.2% Above Corresponding 1598 Week

1959y "totaled 603,178 cars, the Association of American Railroads
This was an increase of 70.181 cars, or 13.2% above
,

shipments of 483

mills reporting

■

week,, production of reporting mills was 1.7% below, shipments
were 1.4% below; new orders were 0.6% below.
For the latest
week, as against the corresponding week in 1958 production of
reporting mills was 7.5% above; shipments were 15.8% above; and
orders

were

+11

to

noticeably lower
1957. Some 14%

week, for March 14, an increase of 9% was recorded. For the
four weeks ended March 21 a gain of 10% was registered.

fewer businesses failed than in the comparable week of prewar
1939 when 310 occurred.
"

According to the Federal Reserve System department store
sales in New York City for the week ended March 21 showed a
16% increase from that of the like period last year. In the pre¬

All of the week's increase was concentrated in failures

liabilities of $5,000 or more, which rose to 265

with

from 256 in the

previous week but remained below the 287 of this size a year ago.
In contrast, small casualties, those with, liabilities under $5,000,
dipped to 32 from 36 last year and 40 in tho corresponding week




University; he has
the

above the like period last year.

He

is

member of the Ameri¬

a

Statistical

can

American

in

the

corresponding period in 1958.

Association, the
Association,

Finance

American

Associa¬

Economic

tion, and the Cleveland Society of
Security Analysts. He has written
articles on the security markets
and

"Barron's Week¬

finance for

the "Harvard Business Re¬
view," the "Analysts Journal" and

ly,"

"Commercial

Financial

&

Alkow & Go. Absorbs

Toboco & Co. Inc.
BEVERLY

Calif;—The

HILLS,

opening April 1 of the first West
COast

office

the

of

York

New

investment film of Alkow &

Co.,

Inc., at 9235 Wilshire Boulevard,
has been announced by Jacob M.

Alkow, President.
Alkow &
of the New
and

Co., Inc. is a member
York, American* and
Stock Exchanges,

Coast

Pacific

the

office

new

will

investment

complete

offer

a

in

service

domestic and foreign securities,
underwriting, and mutual funds.

Milton
will

be

Toboco, Vice-President,
resident

of the

manager

Beverly

Hills

Weston,

office.

Vice-President,

I).
bo

Daniel

will

in

charge of the firm's under¬
writing and corporate financial
management departments.
Mr. Toboco

was

formerly Pres¬

ident of Toboco & Co. Inc., whichbeen succeeded by the new

has

Alkow office.

Steiner, Rouse & Go.

Celebrating 35 Years
Steiner, Rouse & Co., members
Exchange
and other leading exchanges, on

of the New York Stock

March 31 celebrated the 35th an¬

niversary of its founding. Estab¬
in 1924, the firm's head¬
quarters are located at 19 Rector
St., New York City?*

lished

New

tained

York

at

branches

157

East

Madison Ave., 1440
122 East 42nd St.

branches

are

are

86th

main¬

St.,

575

Broadway and
Out

of

town

located in Birming¬

ham, Ala., New Orleans, La., and

Ala.

Mobile,

In the preceding

ceding week, March 14, a decrease of 7% was reported and for the
March 7 week a 1%, decrease was recorded. For the four weeks
ended March 21 an increase of 1% was noted over the volume

an MBA
He has lectured

latter.

corporate finance and invest¬
ment analysis in graduate courses
at Western Reserve University. *
on

Nationwide Department Store Sales Up 17%
on a country-wide basis as taken from

advanced 17%

the

University and *

from

year ago.

the Federal Reserve Board's Index for the week ended March 21,

in

born

was

York

+15;

slightly to 297 in the
preceding week, reported

Dun & Bradstreet, Inc. While casualties were
than the 327 last year, they exceeded the 290 in

Barker

has studied at Columbia and New

Department store sales

Commercial and industrial failures rose
week ended March 26 from 292 in the

Mr.

Central and South Atlantic

Edge Up

tho

of

State of Washington, received his

Pacific Coast +9 to +13; West North
+7 toTl+; West South Central +6
+9: Mountain +4 to +8; New
England +3 to +7; East South Central +1 to +5.
Considerable year-to-year gains occurred in sales of women's
dresses, suits, fashion accessories, and millinery, and volume in
coats and sportswear was
up
moderately.
Retailers reported
appreciable increases in girls' blouses, dresses, and shoes. The
call for men's furnishings heightened, especially hats, dress shirts,
and hosiery, but the buying of sportswear dipped somewhat. In¬
terest in men's lightweight suits was up substantially from a
Atlantic

Committee

AB from Stanford

to +10; East North Central +5 to

9.3% above.

Business Failures

cars

11% higher than a year ago, according to spot estimates collected

7 ;"'v
For week ended March 21, as compared with the previous

new

passenger

by Dun & Bradstreet, Inc. Regional estimates varied from the
comparable 1958 levels by the following percentages: Middle

equivalent to 21 days' production at the cur¬
rent rate, and gross stocks were equivalent to 44 days' production.
For the year-to*date, shipments of reporting identical mills
were l'.4% ataove production; new orders were 5.7% above pro¬
;

new

for the

were

Finance

company's Board of Directors.

The

matched that of a week earlier
remained substantially higher than last year, according to

buying of

scattered reports.
The total dollar volume of retail trade in the week was 7 to

21, 1959. In the same week new orders of these
mills were 6.2% above production. Unfilled orders of reporting
mills amounted to 45% of stocks. For reporting softwood mills,

duction.

in women's merchandise more noticeable than in men's lines.

and

week ended March

unfilled orders

buying climbed noticeably in the week ended
March 25 boosting total retail trade over that of both the compar¬
able calendar week last year and the 1958 Palm Sunday week.
The most outstanding gains were in sales of apparel, with increases

to the National

above production

2.5%

Barometer were

the

Consumer

announced.

Trade

by Enlarged Easter Sales

ciated with
the Cleveland

Chronicle."

Retail Trade Aided

Barker

Illuminating
Company
and, in recent years, was its Chief
Economist. He was Secretary of

the

There

■

Electric

prior week.

Loadings of revenue freight for the week ended March 21,

For March 21 Week

Mr.
Barker

demand climbed

substantially boosting prices somewhat over the
was a marked rise in export inquiries for rice
and a pick-up in business is expected in the near future.
Do¬
mestic trading was steady and prices were
unchanged.
Sugar trading slackened this week, but prices matched those
of the preceding week. Wholesalers reported an appreciable gain
in cocoa transactions and prices were steady.
There was little
change in, coffee volume and prices were close to a week earlier.
Reflecting higher sales, hog prices rose steadily during the
week and finished noticeably higher than a week earlier; hog re¬
ceipts in Chicago expanded slightly from the prior week. Cattle
receipts were, down slightly and trading declined somewhat; prices
were fractionally below those of the
preceding week. Although
the salable supply of lambs was down sharply during the week,
trading was steady and prices were up substantially.
Following
the rise in hog prices; prices on lard rose appreciably.
Cotton prices on the New York
Cotton Exchange moved
within a narrow range during the week, but finished slightly
higher than the prior week. United States Exports of Cotton for
the week ended last Monday were about 55,000 bales, compared
with 45,000 in the prior week and 118,000 a year ago. The total so
far this season came to less than 2,000,000 bales, compared with
3,665,000 about the same time last season.

,

Shipments 2.5% Above Production

corn were

The domestic buying of flour was sluggish this
week, but export

Studebaker-Packard, 14.5%; Chrysler Corp., 9.6%; and General
Motors, 1.9%.
"Ward's" said GM had four Buick-OldsmObile-Pontiac assem¬

Lumber

New

office,
Wall

0:

has been asso¬
Austin

C.

the

in the meal market.

adjustment. However, "Ward's" said Ford Division will have three
car-making and five truck-erecting plants busy beginning Satur¬

week in 1958, but a decrease of 82,658 cars, or
in 1957.
Loadings in the week of March 21 were 7,876 cars, or onethird of 1% above the preceding week.

noticeably

light and domestic and export purchases
were sustained at a
high level. Corn prices moved up moderately
from the prior week.
Although trading in soybeans remained
close to a week earlier, prices rose
moderately reflecting strength

"Ward's" said Ford Motor Co. programmed the sharpest decline

below the corresponding week

were

reduced.

Supplies of

the corresponding

some

were light. A move in
Congress to increase price supports
stimulated trading in oats and
rye; this resulted in slight price
increases. Commercial stocks of rye in

lo¬

-Since'. 1944,

markets

date.

Lumber

be

Street.

Wholesale

industry its fourth-best March in history, with total volume ap¬
proaching 500,000. March sales last year totaled 365,000.
"Ward's" said Chrysler Corp. jumped to 12.5% of March 11-20
sales from 9.9% in the opening 10-day period, launching its "come¬
back" following production setbacks in recent months.
Production of passenger cars and trucks was tempered last
week by Good Friday (March 27) closedowns, as well as assem¬

The amount of electric energy distributed by the

4

Food Price

The Index

it
an-

cated in the

firm's

industry

Lumber

will

York

living index. Its chief function is to show the general trend of
food prices at the wholesale level.

12.1%

been

has

nounced. Ho

Wholesale Food Price Index Unchanged

of 31

-

Ex¬

Stock

change,
Economist,

1958.

Higher in price the past week were flour, oats, bellies, butter,
potatoes, steers, and hogs. Lower in price were corn, rye, barley,
lard, sugar, coffee, cottonseed oil, cocoa, and eggs.

ot

the New York

Central

best mid-month sales rate since June 11-20 of 1957 when an even

Car

Company,

members

68, in the East North Central
increases also appeared in the West

20,000 new cars daily were delivered at retail.
The statistical agency said the sudden surge surprised veteran

Electrie Output

Illuminating

has joined Hornblower & Weeks,

and South Central States.
Contrasting declines
prevailed in four regions, including the Middle Atlantic States
where casualties dipped to 92 from 110 last week.
Failures ranged
below year-ago levels in six of the nine
geographic regions. The
West North Central, West South
Central, and Pacific States suf¬
fered the only increases in
mortality from the comparable week
of

formerly

Barker,

States climbed to 76 from
from

51

failing

'

year ago.
Five regions

Pacific

Reach 500,000 Units

Other reductions in output last week:

Austin

Chief Economist of the Cleveland

as

mid-month high in new car sales was re¬
corded March 11-20, "Ward's Automotive Reports" said, as the
auto industry showed promise of its first spring pickup in demand
since 1955. March 1-20 sales topped Feb. 1-20 by 12%.
"Ward's" said the 174,780 new car sales for March 11-20 aver¬
aged to 19,420 daily, a 16.5% increase over 16,660 a day March
1-10 when 133,300 were retailed. The upturn gave the industry its

day, March 28.

Hornblewer & Weeks
C.

declined to 145 from 153 and construction dipped to 40 from 43.
No group except commercial service had as

A near two-year

in week ended March

C. Am* Barker With

to 57 from 47, wholesaling, up to 31 from
27, and commercial services, up to 24 from 22, accounted for the
increase during the week. On the other hand,
retailing casualties

'77

7'v7

as

37

Jains Lester, Ryons
^Special to The Financial Chronicle)

„

/
i

Calif.—Joyce
joined the staff ofLester, Ryons & Co., 623 South
Hope Street, members of the New
York and Pacific Coast Stock Ex¬
LOS

E.

ANGELES,

Brown has

changes.

38

The Commercial and Financial Chronicle

(1558)

.

Thursday, April 2, 1959

.

* INDICAIti,

Now

Securities
it Adam Consolidated

Industries, Inc.

$1,500,000 of convertible subordinated
debentures, due 1974. Price—To be supplied by amend¬
ment.
Proceeds—For general corporate purposes. Un¬
filed

31

March

derwriter—Dempsey-Tegeler & Co., St. Louis, Mo.

(par five

400,000 shares of common stock

1 filed

Dec.

cents). Price—$6 per share. Proceeds—For research and
development program; and for equipment and working

Office

capital.

Underwriters
and

—

—

4130 Howard Ave., Kensington, Md.

Wesley Zaugg & Co., Kensington, Md.,

Williams, Widmayer Inc., Washington, D. C.

Agricultural Insurance Co.
March 23 filed

132,000 shares of capital stock (par $10),
exchange for stock of Anchor Casualty

to be offered in

Co. at the rate of one Agricultural share for

each Ancnor

(par $10) and 1 1/10 Agricultural shares
for each share of Anchor $1.75 cumulative convertible
common

share

preferred stock (par $10).
Office —215 Washington
Street, Watertown, N. Y. Underwriter—None.
Aida

Industries, Inc.
March 16 (letter of notification) 50,000 shares of cumula¬
tive preferred stock (par 75 cents); Price—$1 per share.
Proceeds—For general corporate purposes and working
capital. Business — Manufacture, sale and distribution
of novelty items, toys and costume jewelry. Office —
146 West 28th St., New York, N. Y.
Underwriter —
Darius Inc., New York.
-ArAirtek Dynamics, Inc.

(4/27-5/1)
(no par).

be

supplied by amendment.
Proceeds—For
additional working capital and for repayment of bank
and other loans.
Office —2222 South Figueroa Street,
Los

Angeles,

Calif.

Underwriter—S.

D.

Fuller

&

Co.,

New York.

\

29 filed
640,660 outstanding shares of common
stock, of which 300,000 shares are to be offered cur¬
rently and the remaining 340,660 shares in the future
Price—To be supplied
by amendment.
Proceeds—To
selling stockholders. Office—6327 Santa Monica Boule¬

Los

Angeles, Calif.
& Go., Los Angeles, Calif.

Underwriter—Lester, Ryons
No public offering expected.

Alaska Mines & Metals Inc.
Feb. 25 filed 1,431,200 shares of common stock (par $1),
of which 1,000,000 shares are to be offered publicly and

431,200 shares

are

to be reserved for sale to the holders

of 6% debentures due 1962 issued by DeCoursey-Brewis
Minerals Ltd., the company's parent (payment for the

shares

by such debenture holders may be made by
delivery of debentures at par plus interest with premium
for Canadian exchange rate).
Purchasers will receive
common stock purchase warrants on all shares
purchased
rate of
per

or

one

for the 6% debentures of the parent at the
for each five shares purchased. Price—$1.25

share. Proceeds—For general corporate

purposes and

working capital. Office—423 Fourth Ave., Anchorage,
Alaska. Underwriter—To be named by amendment.
•

Alco Oil & Chemical

Corp, (4/7)
March 5 filed 500,000 shares of common stock. Price—
To be supplied by amendment.
Proceeds — To selling
stockholders.

Office

—

Trenton

Avenue

William

and

Street^ Philadelphia, Pa. Underwriter—Chace, Whiteside
& Winslow, Inc.,
Boston, Mass.; and Ball, Burge &
Kraus, Cleveland, Ohio.
Allied

Boston Corp. and

/

.

;

j

25

filed

„

*

;

Associated

of common stock,

514,500 shares

*

jreferred shares
(ccounl

r

-To

j

to

the

company

(par

one

cent).

offered for public sale for

to be

are

and

the

will

shares

common

The
the

be

o

the account ol a selling stockholder. Price
supplied by amendment.' Proceeds—To acquire

be

bowling centers1 and increase working capital (part

'

used'm

defraying cost of acquisition of stock of
Brooklyn (N. Y / bowling center.
Offiee—
St./N7 Y. /Underwriter — To be named by
amendment.
Offering—Expected in two week:-..

be

135

•

■

of-a

owner

by common stockholders at the
for each one share held. Price—

or

offered lot

•<>e

offered for subscription
1.4 new shares

Bowling Centers, Inc.

standing sharet of common stock

*•

-

.

Vov. 24- filed 300,000 shares of 20-cent cumulative con¬
vertible preferred stock (par one cent) and 50,000 out¬

tew

March

Independent Reinsurance Co.*

/EDT)-on

a.m.

Armstrong Uranium Corp.
.
(letter of notification) 3,000,000 shares of com¬
stock (par one cent). Price — 10 cents per share.
Proceeds—For mining expenses. Office—c/o Hepburn T.
Armstrong, Round Up Heights, Cheyenne, Wyo. Under¬
writer—Bruno-Lencher, Inc., Pittsburgh; Pa.
;
r

Fund, Inc., Denver, Colo. /

:urity Bldg., Denver 2, Colo.

11:30

to

mon

1,000,000 shares of capital stock (pai om
;ent).
Price—At market.
Proceeds—For inveslineiii
Jffice—800 Security Building,, Denver, Colo
Undei
writer—American Growth Fund Sponsors, Inc., 80i> Se v

it American

up

Jan. 16

-

filed

17

(jointly); White, Weld & Co.; The First
W/G. Langley & Co, (jointly). Bids—

Expected to be received
May 5.;.;-;:7,7/';,.. ,7.'./ 7 >7

-

American Growth

Front

amendment. Proceeds—To increase f„
★ Atlantic Research Corp., Alexandria, Va/.
? '
capital and surplus, Office—307 S. Orange Avenue, Or- March 31 filed 110,000 sharej of common stock, oi which
lando, Fla.
Underwriters—Francis I. du Pont & Co.,
100,000 share/ are to * be offered publicly and 10.000
Lynchburg, Va., and Goodbody & Co., New York, N. Y.
shares to employees under company's incentive * plan.
American Investors Syndicate, Inc.
Price
To be supplied by amendment. Proceeds — To
Feb. 24
(letter of notification) 100,000 shares of comleduce short-term bank loans and to provide equipment
inon
stock (par 10 cents).
Price—50 cents per share.
for development and production of propeliant rockets.
Proceeds—For operation of an apartment hotel.
Office
Underwriter—Johnston, Lemon & Co., Washington, D. C.
513 International Trade Mart, New Orleans 12,. La.
Atlas Investment Co.
-./.- 7- • •*
-•/••--/''"f.
\Undenvriter—Assets Investment Co., Inc., New Orleans,.
Feb; 3 filed 50,01.0 shares of common voting stock (par
Louisiana.
7 :
suoolied

be

To

by

—

common;

stock (par $1), Price—$8.50 per share.
Proceeds—For
general corporate purposes. Office—665 S. Ankeny St,
Portland 14, Ore. Underwriter—First Pacific Investment

Corp., Portland, Ore.
★ Alscope Explorations Ltd.
March

26
filed
1,000,000 shares of capital stock, of
which 700,000 shares are to be offered
publicly in the
United States, and 300,000 shares in Canada.
Price—Re¬

lated to the then current market
price" on the Canadian
Stock Exchange (31 cents per share on March
16). Pro¬
ceeds—For properties, drilling
costs, working capital and
general corporate purposes.
Office — 303 Alexandra

Bldg;r Edmonton, Canada. Underwriter—None
States; Forget & Forget in Montreal, Canada.

in United

7/Z:'>7;;7.

Office—Magsaysay Building, San Luis, Ermita, Manila,

Republic of Philippines. Underwriter — Gaberman
Hagedorn, Inc., Manila. Republic of Philippines.

Preferred by both!
You get

double impact when you advertise securities in
Chicago Tribune. It is the newspaper preferred in

public. I\o other

by professional investors

and the general
here commands such great in¬

fluence and circulation. To sell the
your nearest

prosperous

midwest market,

Chicago Tribune representative today.

&




NEWSPAPER

Price —$25

$10).

share.

per

Proceeds —To

purchase

additional contribution certificates of Great Basin Insur¬

490,000 shares of capital stock
Proceeds

-

Pric<

ance

«.

Co.

Offiee—704

Virginia

Street,

Reno. Nev.

Un¬

derwriter—None.

For investment in firsi
notes, second trust notes and construction loans
Jompanj may develop shopping menters and build oi
jurchase office buildings.
Office—900 Woodward Bldg..
—

Australian

Grazing & Pastoral Co., Ltd.4,000,000 shares ofj common stock. Price—:
(56j/4 cents per share). • Proceed*—To purchase
Washington, D. C. Underwriter—None. Sheldon Maga¬
cattle7' fO> improvements! to buy additional ranch in
zine, 1201 Highland Drive, Silver Spring, Md. is Presi- 7: Queensland, Australia; aiid lor other corporate purposes.
lent.-

7

''/

V

■

•

7

.

Jan.

filed

13

At par

Office—1301 Avenue L.

--1

Cisco; Tex.
Robert* Kamon is President.

it Amican Petroleum & Natural Gas Corp. Ltd.
March 23 filed 745,000 shares of capital stock (no par),
of which 500,000 shares are to be sold for the account

Underwriter—None.
;7

.

Automatic Canteen Co. of America

'

/ 17
March 2 filed 292,426 shares of common stock, of which,
;

7

of the company, and 245,000 shares by the holders there¬
of.
Price—30 cents per share.
Proceeds—For explora¬
tion and development program./ Office,— 2100 Scarth

the company-proposes to issue 126,072 shares to A.M.I.
Inc.'-for the latter's property and assets, and the re¬

Street,

Regina, Saskatchewan, Canada. ; UnderwriterCumberland Securities, Ltd., Regina, Canada. *
* 7

of stock options.

it American Pipe & Construction Co.
7/March 20 (letter of notification) 10,171 shares of com-,
mon stock (par $1)
to be offered pursuant to Employees :
Stock Option Plan. Price—$14.88 per share. Proceeds— *
For working capital.
Office—390 South Atlantic. Blvd., ;

Feb. 28j 1958,

maining 166,354 shares are to be issued upon the exercise
Underwriter—None.
" 7
7
•

.

Monterey Park, Calif.
Feb.

Underwriter—None.

17,1958, filed 375,000 shares of

>

8an

Mtrenty

Liit

insurance

Co.

"r

•

••/'

filed 258,740 shares of common stock (par
$1), of which 125,000 shares are to be offered publicly
and 133,740 shares to employees pursuant to stock frur-/
chase options. Price—To public, $8 per share. Proceeds^—
For expansion and other corporate purposes. Office—A tanta

;

eH

G;

Underwriter—Nom

''

Bankers Preferred- Life Insurance Co.

<;

Jan. 30

common stock

(par

-

stock

(letter of notiifcatioh) 100,000 shares of-common 1
(par $1.60): Price—$3 per share
Pfocfceds-^For

$1). Price—$4 per share.- Proceeds—To purchase equip- *
men! and supplies and for working capital and* other r expenses incidental to; operation of an, insurance Com- ;
pany:
Office—Suite, 619, E. & fX'. Bldg.,; Denver, Colo.
corporate purposes. Office—Salt Lake City, Utah. Uif-* *
Underwriter—Ringsby Underwriters, Inc., Denver 2,
derwriter—Amos
Treat
&
Co., Inc., of New York
Colo.. 7
; v;
'7-7 -'
" "7' 7
Change
in Name—Formerly .United States Telemail
Service, Inc.

...

•

.7

-

.

.

March

later reduced to 500,000 shares (par $1").
Pticc—$9 per
share. Proceeds—For expansion and acquisition or leas¬

23

(letter of notification) 60,000 shares of com¬
Price—$5 per share. Proceeds
Office—300- E.- Fourth Street,
St. Paul 1, Minn. Underwriter—None.
-

stock (par 50 cents).
—For working capital.

.

mon

-

ing of new sites.
phia, Pa.
•

American Vitrified Products Co.

i

>

on

the

basis

Price—$30

per

of

one

share.

share

for

each

Engineering Co.. (4/26).'

.

20 filed

Wells &

shares'

20

Office—2210 Walnut Street, Philadel¬

110,0.00 shares of common stock, of which
85,000 shares are to be offered for public sale by Fox,

(letter of notification) 10,000 shares of common
(par $1) to be offered for subscription by stock¬

holders

■

Underwriter—Bear; Stearns & Co.. New York.

Barnes

March

March 3

held.

Bargain City, U. Si A., Inc. (4/15)
/
5,000,000 shares "of common stock (no par),

Dec. 29 filed

7

American Television &r Radio Co.

Proceeds—To reduce short- '

term bank

Rodgers, the holder thereof; and the remaining

shares for the account of the Barnes company.
Price—To be supplied by amendment. Proceeds—$104,995 to prepay a 4% note, due in December; $100,000 to

25,000

borrowing and for working capital. Office—
L. Miller, President, 20725 Shaker Blvd., ! pay the remaining tax liability of a former
subsidiary;
Heights, Ohio. Underwriters—E. R. Davenport &
and the balance will be added tp working capital1 and
Co., Providence, R. I. and Merrill, Turben & Co., Inc.,*' Used for general corporate purposes, including approxi¬
Cleveland, Ohio.
mately $100,000 for plant and test equipment, fixtures
and leasehold improvements in connection with plant
Ampex Corp. (4/3)
March 12 filed 204,191 shares of common stock
expansion. Office—30 Commerce Rd., Stamford, Conn.
(par $1)
to be offered for subscription by common stockholders- Underwriter^-Hayden, Stone & Co.; New York.
c./o

Edgar

Shaker

the. rate of

one

new

share

for

each

10

shares

held

Basic

Atomics

April 2; rights to expire on April 17. Price—$52.50
per share. Proceeds—For working capital. Underwriters
—Blyth & Co., Inc., San Francisco and New York; and

cents).

Irving Lundborg & Co., San Francisco,

Underwriter—None.

March

on

construct

and

equip

present facilities of the cot*

derwriters—R.
both of

W.

New York.

nam*

Pressprich

&

plant

space

adjoining
T

and

filed

Inc.

444,246 shares of

common stock
(par 10
Price-—At prevailing market price, in the Over-

Proceeds^—To selling stockholders".
:

.

.

i"

Co.

5

the-Counter Market.

Calif.

★ Anken Chemical & Film Corp. (4/16-24)
March 27 filed 225,000 shares of common
stock, of which
112,500 shares are to be sold for the account of selling
stockholders, and 112,500 shares for the account-of the
company. Price — To be supplied by amendment..
Pro¬
ceeds—To

WORLD'S^ GREATEST

«

Inc.

rust

at

the

Chicago

newspaper

Investment Co.,

Mutual

Jec. 17, 1957, filed
-$10.20 per share.

stock

American Asiatic Oil
Corp.
Nov. 24 filed 100,000,000 shares of
capital stock. Price—
Two cents per share. Proceeds—To
selling stockholders.

and Mid America

"

American

Publishers, Inc., Portland, Ore.

THE

Securities & Co.

American Telemail Service, Inc.

Nov. 28 (letter of notification) 22,000 shares of

see

petitive bidding. Probable bidders: Lehmar. Brothers;
Blyth & Co., inc., and Smith, Barney & Co. (jointly);
Equitable Securities Corp. and Eastman Dillon, Union

Credit Co.
.Vov. 13 filed 5,000,000 shares of common stock, of which
4,545,455 shares of this stock are to be offered for public
*ale at $1.75 per share. [Shares have been issued or are
ssuable under agreements with various policy holders
n American
Buyers Life Insurance Co. and American
Life Assurance Co. (both of Phoenix) permitting them
:o purchase stock at $1.25 per
share. Sales personnel
lave been given the right
to purchase stock at $1.25
per share up to the amount of commission they receive
m stock sales made by them.]
Proceeds4~For the opeua:ion of other branoh offices, both in Arizona and in other
dates. Office—2001 East Roosevelt, Phoenix, Ariz. Un-

—

Dec.

for cash

* Arkansas Power & Light Co. (5/5)
26 filed 75,000 shares of cumulative preferred
siock
(par $100)/ Proceeds^—For property additions and
improvements. Underwriter—To be determined by com¬

—

vJov.

ISSUE

REVISED

March

March 31 filed 325,000

ierwriter-^N one.

ITEMS

.

Alaska Juneau Gold Mining Co.

vard,

^American Biltrite Rubber Co., Inc. (4/20-24)
shares of common stock, (par $1).
Price
To be supplied by amendment.
Proceeds — To
selling stockholders.
Underwriter—Goldman,-Sachs &
Co., New York.
*

AOi/lilOnd

V SINCE PREVIOUS
•

rate of

March 27 filed 150,000 shares of common stock

Price—To

in

American Buyers

Inc.

Research Associates,

Advanced

r/

Riter

&

!

^ Birfdefcd & Saco Development Corp.
March 17 (letter of notification) 25,000 shares of com¬
mon stock.
Price—At par ($10 per share). Proceeds
For purchase of now vacant Saco Lowell
buildings and
.

*

to rent

* same.

Office

Underwriter—None.

—

,

208
.

Main
^

St.f Biddeford,- Me.
-

rj~>-

it Billups Western Petroleum Co.

Co.,

April .1 filed $5 000,000 of 6
participating debentures
due May 1, 1984 and 1,000,000 shares of common stock

units

in

offered

be

to

Number 5834

189

Volume

.

of

.

The Comviercial and Financial Chronicle

.

$10

debentures

of

and

two

Pa.

shares of-stock Which will not be transferable separately
until Nov.- 1A, t959.H The companyj is^ alsn registering

Underwriter—Woodcock, Hess, Moyer & Co., Inc.,

Philadelphia, Pa.

Oct. 23

supplied by amendment. "Proceeds—To be used in the
acquisition of substantially all the / assets of 39 corpo¬
rations and. a partnership .engaged^ in -.the - operation of
i95 gasoline stations v im Mississippi, ^Texas,, Louisiana,

stock

(letter of notification) 15,000 shares of common
(par $1) to be offered for subscription by stock¬
holders of record Nov. 1, 1958 on the basis of one new

.

Alabama,: Missouri,: and Tennessee.- Underwriter—The
Johnson, Lane, Space Corp., Savannah, Ga.
"
i : y
Power

Hills

Black

•

&

Light Co.

;

,

.

to be offered for

subscription by holders of outstanding

stock of record April 1, 1959-on* the basis of

common

/share

£ Boonshaft & Fuchs, lnc>,: Huntingdon. Valley, Pa.
March. 20-' (letter ofT2m^;ication).v90;000
of com¬
mon stock f par 25 centsiji ^rice—$2:,per share.Proceeds
—For expansion; to repay bank loans and for working
capital. * Office—994 Byberry Rd.; rHuntingdon Valley,

Car Ion Products

Corp., Aurora, Ohio.

(4/6-10)

additional working capital and other corporate purposes.
Business—Manufacturer of plastic pipe and pipe fittings.

Underwriter—-Shearson, Hammill & Co., New York.
Cemex off Arizona, Inc.

For working capital.
Address—P. O. Box 1849, 3720 E.
32nd Street, Yuma, Ariz. Underwriter—L. A. Huey Co.,

Brookridge Development Corp.

Dec.

19

15-year

(letter of notification) $200,000 of 6%

convertible debentures.

Price—At par

($500 per unit).

1

Proceeds—For expansion and working
901

(Bids

10

a.m;; est;- $7,oqq,ooo~

Louisiana

Central

Electric

Co., Inc. (4/20)
first mortgage bonds, series
I, due 1989. Proceeds—To repay $1,000,000 of bank loans*
and to finance construction program. Underwriter—To
be determined by competitive bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; Salomon Bros. & Hutzler,
Merrill Lynch, Pierce, Fenner & Smith, Inc., and Stroud
& Co. (jointly); Kidder, Peabody & Co.; White, Weld
March 20 filed $5,000,000 of

(Bids

$7,500,000

11

on

page

40

Bonds

$20,000,000

EDT)

a.m.

Southern Nevada Power Co
(May

;__Preferred

Light Co

(Bids to be invited)

"

Proceeds—

Public Service Co. of Colorado—^

$11,000,000

CST))

a.m.

share.

Denver, Colo.

_-Bonds

& Light Co

Louisiana Power &

per

Continued

(Tuesday)

April 14

^

•

—

Price—$1

(par 25 cents).

CALENDAR

ISSUE

Central Power

Ry:-/^^i^E«.uip. Trust Ctfs.

Underwriter

stock

Co., 15 William St., New York, N. Y.

Sano &

.

Office—

capital.

Ave./ Brooklyn 27, N. Y.

Seneca

.

(Bids/u

& Western

Norfolk

Under¬

loans.

•

March 12 filed 100,000 shares of common stock (no par).
Price—To be supplied by amendment.
Proceeds—For

Securities

April 2:. (Thursday) • ;
Co———li--—^-^™Bend»

n

stock (par $50).

shares, to be offered in units, each unit consisting o£
one share of stock and one warrant, for subscription by
stockholders of record April 21, 1959, at the rate of one
unit for each three shares then held; rights to expire on
May 6 (the warrants carry an initial exercise price of
$20). Price—To be supplied by amendment Proceeds—
For working capital and other corporate purposes. Un¬
derwriter—Sutro Bros. & Co., New York.

Nov. 17 (letter of notification) 300,000 shares of common

■: v

.

(4/22)

writer—To be determined by competitive bidding. Prob¬
able bidders: Halsey, Stuart & Co. Inc.; Stone & Webster

NEW

Power

(4/22)

Corp.; Kuhn," Loeb & Co., Salomon Bros. &
Hutzler and Wood, Struthers & Co. (jointly); Kidder,
Peabody & Co., White, Weld & Co. and Shields & Co.
(jointly). Bids—To be received up to 11 a.m. (EST) on
April 22 at 49 Federal St., Boston, Mass.

—

Ridge Mutual Fund, Inc./ New York
March 25 filed/by/amendment)/ an -addit-ional 500,000
shares of imxhmon ^—
For investment.V* }'•*•■'>yf^ryy:
> ,

v

creditors

March 6 filed 40,000 shares of preferred
Proceeds—To reduce short-term bank

Blue

Gulf

shares

current

to

Edison Co.

Brockton

621 Sixth St., ARapidf City,- S. Dak.
Underwriter—Dillon^ Read & Co. Inc., New/York. Offer¬
ing—Expected today (April 2)...
•

;

four

one

To be supplied by .amendment. Proceeds—To be used
for property additions and improvements and to repay
some $400,009 of :bank loans; obtained primarily for such

Office.,

each

be .offered

:> or

pew share for each 11 shares held * (with an over-sub¬
scription privilege); rights hrexpire on April 16. Price—

purpose.

for

held; unsubscribed shares
in payment of all
part of claims, at the rate of one share for each $4
of claims discharged; rights to expire about two weeks
after mailing of offer. Price—$4 p"** share. Proceeds—
To pay current creditors.
Address — P. O. Box-506,
Bridgehampton, L. I., N. Y. Underwriter — None. Offer¬
ing—Has been delayed.
f
will

* B. S. F. Co.

39

March 26 filed 113,079 shares of capital stock (par $1L
and warrants for the purchase of an additional 113,079

*

'

Bridgehampton Road Races Corp.

50,000 shares of-common stock; not dneluded;in ;the units,
will be offered to - its employees.,.: 5rice—To be

which

March 13 filed 32,198 shares of common stock (par $1),

(1559)

Hornblower

be

Weeks;

&

First

Preferred

William R. Staats
$1,500,000

California

&

Co.

and

Co.)

-

(Bids^noon EST) £7,350,000

April 3

(Friday)

/

'/<v.

:

Amp ex Corp———1,

,//

by

Blyth

by Tto&S,

.Co.,.:Inf.)

Massachusetts

Western

April 30

(Wednesday)

Common
$4,500,000

Co.)

Common

May

11:30

a.m.

.

Common

Companies

(Thursday)

April 16

Boston

(R.

& Film

Chemical

Anken

Corp.

shares

Arkansas Power & Light Co

Carlon Products Corp.,——.
V '

—Common

(Shearson, Hammill & Co.)

:.

V/;4

100,000 shares

*

Dalton

Finance

Inc.---

:

C.

;

;

Kimball

&

(Smith,

American

$50,000,000

—-——Common

Corp.

(Eastman

Harzfeld's Inc.
■/

Co.)-;46.200

•:.

(Bids

1

Kalman

by

(Tuesday)

Graham-Paige

&

*

Preferred

(Kidder,

$3,500,000

Republic

Common

■

to

invited)

be

and White, Weld & Co.)

Diamond

Comomn

Hawaiian
(Dillon,

(Lehman Brothers) 320,000 shares

Electric Co.,.

Read

& "Co.,

Inc.

—Bonds

Ltd—

$10 000.000

Witter & Co.)

and Dean

Power

of

San

Paso

Corp.——

sC&mos

Treat

El

Paso

Electric

Inc.)

$300,000

•

Frito

•

Rittei^f Finance" Co.__—i/—-———Preferred
-f

Bank

Ritter
."

/

,

(Stroud & Co., .Inc.) 25,000 shares

,

America

Brockton

fBids

$20,000,000

^Dillon, Read & Co.)

...

April

&

Co.)

113,079

Bank of

50.000

(Thursday)
Bonds

(Friday)
Common

Commerce, Washington, D. C
(Offering to stockholders) $300,000

June

units

2

(Tuesday)

Public Service Electric & Gas Co

(Friday)

(Bids

Common

to be

Debentures

$30,000,000 to $40,000,000

invited)

Common

Virginia Electric & Power Co

Becker & Co.)

(Merrill Lynch, Pierce, Fenner & Smith and A. G.

Sweeney &
$11,068,275

$14,000,000

(Tuesday)

May 29

$2,000,000

Maine Public Service Co—

Preferred

Southern Union Gav Co

Bros.

April 24

(Friday)

10

Sutro

—Bonds

$45,000,000

Bonds
EST)

noon

(Bids to b9 invited) $25,000,000

stockholders—underwritten by

to

Common
821,258 shares

Southern Electric Generating Co—

Common & Warrants

(Offering

•-

$2,000,000

(Monday)

May 28

/Common

Preferred
EST)

a.m.

B. S. F. Co

(Dillon, Read & Co., Inc. and Halsey, Stuart & Co., Inc.)

Texas Eastern Transmission Corp

11

EDT)

(Thursday)

May 26

200,000 shares

Co..

Edison

-Bonds

a.m.

Consolidated Edison Co. of New York, Inc—Bonds
(Bids 11 a.m. EDT) $50,000,000 to $60,000,000

April 22 (Wednesday)

(Thursday)

April 9

Natural Gas Pipeline Co. of

11

(Bids

300.000 shares

(J. Bartb & Co.)

Common B

Finance Co

Preferred

May 25

Common

(White, Weld & Co. and Dittmar & Co.)

$3,500,000

West Penn Power Co

105,000 shares

Co.)

EDT)

(Offering to stockholders—no underwriting)

Greater All American Markets, Inc

(Stroud & Co.,-Inc.) $1,500,000

;.

&

Bonds

a.m.

Consolidated Natural Gas Co

Debenture*

$5,000,000

Co.

Common

Co

(Bids

Common

Dewar

11

May 21

Diego

——Common

—

Co..

&

Corp

Co

Electric
(Bids

(Offering -io 'stockholders—underwritten by Dean Witter
& Co.; Blyth & Co., Inc.; William R. Staats & Co.;
Eastman Dillon, Union Securities & Co. and
•

Seal

(Friday)

(Tuesday)

May 19
El

"

Hermetic

$15,000,000

(Peter Morgan & Co.) $450,000

Common

First National Trust & Savings
-

Bonds

May 15

325,000 shares

Invited>

(Wednesday)

Co

Seaboard Plywood & Lumber

Ellis &

April 21 (Tuesday)
State Telephone Co

Bonds

$16,000,000

EDT)

a.m.

(Bids 11 a.m. EDT)

Common

bp

11:30

May 13
Idaho

Inc

•Bids to

(W. T.) Co...„:_..:N.
■

•(Bids

Common

Corp.)

Common

Co

Electric

Corp.—Common

Peabody & Co. and Blunt
Simmons) 130,000 shares

(Lee Higginson

(Wednesday)

April 8

Paso

Debentures

Inc

Debentures

Southwestern Electric Power Co.___

Debentures

Enterprises, Inc

Preferred

$44,000,000

Grant

Foil

(Tuesday)

Co

(Offering to stockholders—underwritten by Stone & Webster
Securities Corp.) 76,494 shares -

(Offering to stockholders—underwritten by Laird
Co., Corp.) 70,196 shares

Wometco

$2,475,000

Co

(Stone & Webster:Securities Corp.

-

f

116,541 shares

Pittsburgh & Lake Erie RR._—Equip. Tr. Ctfs.*
Transmission

El

-Bonds

(Dee Higginson Corp.) $1,600,000

Moog Servocontrols,

(Offering to stockholders—no underwriting)

(Bids

Illinois Light

(Paine, Webber, Jackson & Curtis and Stone & Webster
Securities Corp.) 800,000 shares

Common

Mergenthaler Linotype Co.__

Tennessee Gas

110,000 shares

General Telephone & Electronics

$300,000

Corp.
(Bache & Co.)

$5,500,000

Eastman Dillon, Union Securities & Co.) $10,038,TOO

$5,000,000

Corp.

Dynacolor

shares

Co.)

Bonds

Co
PST)

a.m.

(Offering to stockholders—may be underwritten by

Common

EST)

noon

Central

shares

$325,000

(Paine, Webber, Jackson & Curtis and Prescott,
Shepard & Co., Inc.) $3,500,000

•Erdman, Smock, Hosley & Read, Inc.(Simmons

9

May 12

Common

Co., Inc

Co.)

Cooper Tire & Rubber Co

Alco Oil & Chemical Corp
.Common
(Chace, Whiteside & Winslow, Inc. and Ball, Burge & Emails)
500,000

(Monday)

&

Central Louisiana Electric Co., Inc

Common

Co.——

(Offering lo stockholders—underwritten
Co.; Inc.) 42,193 shares

Sachs

(Hayden, Stone & Co.)
;

shares

-v&

April 7

Southern Nevada Power
(Bids

.

(Monday)

May 11

>r

•

..

Engineering Co

Common
&

Steel Products

Indiana

Barnes

$1,877,700

—

(Stern, Brothers

i

-

Union Securities & Co.)

Dillon,

;
"CC. V:-fT-V-\
——Debentures

$20,000,000

Co.)

Biltrite Rubber

(Goldman,

;

Fed-Mart

&

April 20

Common

Eurofund, Inc.

.

Barney

vr

Preferred

EDT) $7,500,000

a.m.

$500,000

Co.)

(Glore, Forgan & Co.)

& Co., Inc.) $3,000,000

•

Philco Corp.——

Debentures

'

(Paul

(Bids 11:30

Chadbourn Gotham, Inc
Debentures
(Offering to stockholders—underwritten by R. S. Dickson

(Monday)

April 6

(Tuesday)

May 5

Common

Corp

W. Pressprich & Co. and Riter & Co.) 225,000

1
•;

Debentures

(Snow, Sweeney & Co., Inc. and A. C. Allyn & Co., Inc.)
$1,000,000

$14,000,000

EST)

(Friday)

1

Arkansas Western Gas Co.—

Bondf

Wisconsin Power & Light Co

Lyon

Bonds

(Bids to be Invited) $20,000,000

& Ives Co

(J. J.)

(Thursday)

Alabama Power Co

(Shields & Co.) $875,000

to stockholders-r-underwritten by The First
and White, Weld & Co.) 177,626 Shares

(Offering

Little

-

(Bids

$217,334

15

Stearns &

(Bear,

Inc.,

..t._.__Common

(Offering to'stockholders—underwritten
&

Co.,

&

204,191 shares

Chemical Corp

Cormac

Common

— _

(Offering* to stockholders—underwritten
and. Irving Lundborg
^-;Co.)

April

Bargain City, U. S. A.^—

f

(Bids to be received) $20.000 000 to $25,000,000

shares

(Offering to stockholders—underwritten by Snow,

Co., Inc. and A. C. Allyn & Co.)

■

;

.

Dorsey

(Blair

•

Gold

Seal

&

Co.,

Inc.)

Common
&

Co.,

Products
(8.

D.

Ihc.)

150,000

shares

&

'

Co.)

$1,250,000

Societe Anonyme, of France
Common
(Offering to stockholders—not being underwritten) $10,120,000




Co.)

June 25

Preferred

stockholders—underwritten by The First Boston
Corp. and Johnston, Lemon & Co.) $10,000,000

(Offering

to

April 28
Di-Noc Chemical
(Offering

(Bids

Blair & Co., Inc.) $947,200

to

(Thursday)

Bends

be invited)

September 10

Debentures

stockholders—underwritten

Bonds

Co

Mississippi Power

(Tuesday)

Arts, Inc

to

(Tuesday)

Co

(Bids to be invited) $20,000,000

150,000 shares

-

Preferred

Corp

Fuller

SIMCA

D. Fuller &

Northern Illinois Gas

1—Common

Washington Gas Light Co

$1,250,000

.

(Blair

(S.

June 23

(Monday)

Dynamics, Inc

.Preferred

-1*

Corp.

Dorsey Corp,

April 27
Airtek

(Monday)

April 13

$5,000,000

(Thursday)

Georgia Power Co.

by
•

(Bids to be Invited) $18,000,000

Bends

40

The Commercial and Financial Chronicle

(1560)

Continued pom page

i( Crowley's Milk Co.,

39

March

(EST)

Bids—Expected to be received up to noon

& Co.

April 20.

"V-,
Co. (4/14)
March 16 fUed SI 1.000.000 of first mortgage bonds, series
I due April 1, 198S. Proceeds—To finance part of com¬
pany's construction costs and to prepay and dischaigc
all bank loans.
Underwriter — To be determined by
competitive bidding. Probable bidders; Halsey, Stuart
& Co. Inc.; Blyth & Co., Inc.; Lehman Brothers and
Glore Forgan & Co. (jointly): Kidder, Peabody & Co.;
Merrill Lynch. Pierce, Fenner & Smith and Salomon
Bros. & Hutzler (jointly); Kuhn, Loeb & Co., A. C.

on

Central Power & Light

Allyn & Co., Inc.. and Bear, Stearns & Co. (jointly):
Eastman Dillon, Union Securities & Co. Bids—Expected
to be received up to 10 a.m. (CST) on April 14.
•

Cerro

de

Pasco Corp.

$8,040,200 of 5V2% subordinated deben¬
tures due 1979 (convertible until Dec. 31, 1968) and 61,522 shares of common stock being issued to stockholders
March

filed

4

Corp. (which is to be dis¬
solved and liquidated) on the basis of 0.107126 of a
share of common stock
(par $3) and $14 principal
of Consolidated Coppermines

Cerro de Pasco Corp., plus
2.678 cents in cash for each Consolidated Coppermines

amount

of

debentures

Underwriter

share.

of

None. Statement effective March

—

25.
± Chadbourn

Gotham, Inc. (4/16)
March 26 filed $3,000,000 of 5.90% convertible subordin¬
ated debentures, due April 1, 1971
(with warrants to

purchase 300,000 shares of common stock) to be offered
for subscription by common stockholders at the rate ol'
$100 principal amount of debentures (with warrant for
purchase of 10 shares) for each 68 common shares held.
Price
To be supplied by amendment.
Proceeds — To
provide additional working capital to finance the com¬
pany's expanding business and will currently be applied
—

to the reduction of short-term bank loans.
—R.

Dickson

S.

&

Underwriter

Co., Inc., Charlotte, N. C., and New

York, N. Y.
Chattanooga Industrial Development Corp.
March 25 filed 37,500 shares of common stock. Price—

share. Proceeds—For purchase and development
properties and for working capital. Office
•—Chattanooga, Tenn. Underwriter—None.
$20

per

filed

26

60,000

Inc.
outstanding

March
shares

Ave.. Binghamton, N. Y.

Underwriter—None.

-

Colorado Water & Power Co.

stock

(par $1) to be offered in units of $200 of deben¬

tures

and

share

one

Proceeds—For

of

Price— $205

stock.

working capital.

per

Office—Suite

unit.

421, 901

Sherman Street, Denver, Colo. Underwriter—Associated
Securities 412 Main Street, Cedar Falls, Iowa.
•

Columbia

Gas

Systems, Inc.
March 5 filed 1,799,057 shares of common stock (par $10)
being offered for subscription by common stockholders
on

the basis of

one

share for each 15 shares held

new7

Dillon. Union Securities & Co.

man

(jointly).

Commerce Oil Refining Corp.
Dec. 16,1957 filed $25,000,000 of first mortgage bonds due
6ept. 1, 1968, $20,000,00 of subordinated debentures du»
Oct. 1, 1968 and 3,000,000 shares rt common stock to b»
offered in units as follows: $1,000 of bonds and 48 sharei
of stock and $100 of debentures
nine shares of stock
Price—To be supplied by ameriwnent. Proceeds — T<
construct

refinery. Underwriter—Lehman Brothers, Nev
Offering—Indefinite.

York

Commercial Investors Corp.
Nov. 28 (letter of notification) 900,000 shares of
tnon
stock.
Price—At par (10 cents per share).
ceeds—For investment. Office—450 So. Main

Trans

A stock

the

basis of

shares

which

Caribbean

stockholders

on

three

each

of

such

share of

one

class A

the

holders

com--,

Pro¬

St., Salt
City, Utah. Underwriter—Earl J. Knudson & Co.
Bait Lake City, Utah.

either

of

hold

as

due

To

Price

At

100% of principal
$2,150,000 term loan,
purchase and installation of a dual tube pro¬
duction line, and for working capital. Office—Lima and
for

retire

—

a

the

Western

Avenue,

Findlay, Ohio. Underwriter—Paine.
Webber, Jackson & Curtis, New York: and Prescott,
Shepard & Co., Inc., Cleveland, Ohio.
• Cormac Chemical
Corp. (4/3)
Jan. 22 filed 108,667 units of 108,667
shares of
stock (par one cent) and
108,667 common stock

common

purchase

warrants, each unit consisting of one common share and
warrant, to be offered for subscription by holders

one

of the
rate

common

of

one

stock of Cormac

such

unit

for

Photocopy Corp. at the

every

six

shares

of

Cormac

Photography

common held on or about April
rights to expire on or about April 17. Price—$2
Proceeds—To finance the company's

3, 1959;
unit.
development and
marketing program. Office—80 Fifth Avenue, New York.
N. Y.
Underwriter—Ross, Lyon & Co., Inc., New York.




per

Co., New York.

York.

9

due

1968.

Federated
tfov.

Finance

(4/6-10)

March 16 filed 170,700 shares of common stock.

Proceeds—For acquisition of land, build¬
ings and fixtures for two new stores; for expansion of

operations of Reid Oil Co., a subsidiary; to reduce debt;
and for working capital.
Office—8001 Athello St., San
Diego, Calif.V Underwriter—Eastman Dillon, Union Se¬
curities & Co., New York.
Finance For

Industry, Inc.

Dec.

16 filed 200,000 shares of class A common stock.
Price—At par ($1.50 per share). Proceeds—For working

:apital.
writer

Office—508 Ainsley Bldg., Miami, Fla. Under¬
R. F. Campeau Co., Penobscot Bldg., Detroit,

—

Vlich.
•

First Virginia Corp.
12 filed 1,154,730 shares

Feb.

of class B common stock
(par $1), being offered in exchange for 38,491 shares of

common

stock of Old Dominion Bank at the rate of 30

shares of First Virginia class B stock for each one share
of Old Dominion common stock. This offer will expire

ic Diamond State Telephone Co.

(4/21)
27 filed $5,000,000 of 35-year debentures, due
April 1, 1994. Proceeds—To be used principally to repay
advances from parent, American Telephone & Telegraph
Co., and for general corporate purposes. Underwriter—To
be determined by competitive bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; The First Boston Corp.; Mor¬
gan Stanley & Co.; White, Weld & Co.; Eastman Dillon,

on

March

April 6, unless extended. Statement effective March

20.

Florida
Dec.

Builders, Inc.

1 filed $4,000,000 of 6%

init.

Proceeds—For

purchase and development of subland, including shopping site; for new equipproject site facilities; for financing ex¬
pansion program; and for liquidation of bank loans and
>ther corporate purposes.
Office—700 43rd St., South,
3t. Petersburg. Fla. Underwriter—None.
livision

nent

Diversified Inc., Amarillo, Texas
6 filed 300,000 shares of common

Jan.

stock (par 50
cents). Price—$3 per share. Proceeds—For acquisition
of undeveloped real estate, for organization or acquisi¬
tion of consumer finance business, and balance to be
used for working capital.
Underwriter — Investment
Service Co„ Denver, Colo., on a best efforts basis.

and

Fluorspar Corp. of America
Feb. 5 (letter of notification—as amended) 300,000 shares
of common stock.
Price—At par ($1 per share). Pro¬

ceeds—For

mining

expenses.

(4/13-17)
par

Feb. 27 filed $21,203,200

purchase of 50,000

common

dinated

(with warrants attached for the
shares) and 150,000 shares
of common stock (par $1).
Price—To be supplied by
amendment.
Proceeds—Together with $1,000,000 of in¬
stitutional borrowings and other company funds, will
be applied for purchase by its subsidiary of the assets

March

—

f

subscription

common

on

the

each three

basis

shares

of

one

of series

share
1

of

series

3

and/or series

2

stock

held; unsubscribed shares to other stock¬
Rights expire 30 days from offering date.
Price—$1 per share.
Proceeds—For working capital.
holders.

Office—333 S. Farish
—None.

Street, Jackson, Miss. Underwriter

for

each

25

shares

of

common

13 filed

Frito Co.

sale

by the
thereof. Price—To be supplied by amendment.
Proceeds
To pay bank loans and for construction,
equipment and development. Underwriter—Lee Higgin-

for

debentures

5a. Underwriter—None.

holders

stock

of

Investment Corp., Atlanta, Ga.
231,988 shares of common stock to be offor subscription by stockholders; unsold portion
o be offered publicly. Price—$12.50 per share.
Proceeds
—To repay notes.
Office—515 Candler Bldg., Atlanta,

proposes to offer the debentures and 80,000
shares in units, consisting of $100 of debentures
and five common shares. Remaining 75,000
outstanding

by stockholders

of 20-year 4% convertible subor¬
1979 being offered initially for

Iered

common

Corp., New York.

due

Foundation

fan.

(4/20-24)

Emerite Corp.
Ian. 19 (letter of notification) 250,000 shares of series 3
common stock
(no par) to be offered for

debentures

held; rights to expire on Aprjl 10, 1959. Price—
At par (flat).
Proceeds — For general corporate pur¬
poses, including additional working capital and future
capital expenditures. Underwriter — Eastman Dillon,
Union Securities & Co., New York.

company

son

74th

stock

approximate amounts of $4,000,000 and $670,392, re¬
spectively. Office—100 West 10th St., Wilmington, Del.
Underwriter—Blair & Co., Inc., New York.

for

E.

subscription by common stockholders of record on or
about March 24, 1959, on the basis of $100 principal
amount

Dorsey Trailers, Inc.. and to the retirement of the
latter company's notes and installment
contracts, in the

offered

S.

Food Fair Stores, Inc.

stock, series A, $50

be

Office—4334

Ave,, Portland 6, Ore. Underwriter—Evergreen Securi•ties, Inc., 4314 N. E. 96th Ave., Portland, Ore.

March 20 filed 25,000 shares of 6% cumulative preferred

to

stock,

be offered in units of $100 principal amount of debenures and one share of common stock.
Price — $110 per

o

& Co., and Kidder, Peabody &
Co.
Bids—Expected to be received on or about

Dynacolor Corp., Rochester, N. Y.

15-year sinking fund sub¬

ordinated debentures and 40,000 shares of common

Securities

are

Price—

$11 per share.

Price—$)
share. Proceeds—Fbr new equipment, repayment of
loan, acquisition of properties under option, and other
corporate purposes. Office—Toronto, Canada, and Emoorium, Pa Underwriter—None.

shares

f

Sugene C. Dinsmore, Omaha. Neb.

per

common

Co.

17

(letter of notification) $300,000 of 10-year 8%
subordinated debentures. Price—At par (in delominations of $1,000 each). Proceeds — For working
capital, to make loans, etc. Office—2104 "O" St., Lin¬
coln, Neb. Underwriters — J. Cliff Rahel & Co. and

Derson Mints Ltd.

Dorsey Corp.

subordinated

The

senior

June 5 filed 350,000 shares of common stock.

(jointly).
April 21.

Underwriter—Glore, Forgan

,

5442,000 of the debentures in exchange for Consumers

working capital and for
general corporate purposes. Underwriter—H. M. Byllesby
& Co., Inc., New York and Chicago.

Union

common stock
(par $1).
Proceeds—For investment. Office

share.

iebentures; and $226,000 of the debentures in exchange
(or the outstanding 12% debentures of three subsidiaries
of Federated. Office—1 South Main
Street, Port Chester,
>J. Y.
Underwriter—None.

be supplied by amend¬
mortgage loans and bank

retire

March 24 filed $1,600,000 of 7% sinking fund debentures
due 1969 and 155,000 shares of common stock.
The

Proceeds—To

Wall

company proposes to offer
5210,000 of the debentures to purchase the capital stock
>f Consumers Time
Credit, Inc., a New York company;

notes and to provide additional

•

(with warrants).

per

St., New

.1974. Price—To
—

warrant.

(4/6-10)

Price—$20

iebenttires

* Dejur-Amsco Corp., Long Island City, N. Y.
31 filed $1,000,000 of convertible subordinated

• Cooper Tire & Rubber Co.
tures

Eurofund, Inc.

Fed-Mart Corp.

Proceeds

one

general corporate

Federated Corp. of Delaware
29 filed $918,000 of 6% convertible

+ Dejur-Amsco Corp., Long Island City, N. Y.
March 31 filed 225,000 shares of class A stock (par $1).
Price—To be supplied by amendment.
Proceeds — To
selling stockholders. Underwriter—H. M. Byllesby & Co.,

debentures

For

Dec.

they are entitled upon con¬
version of their debentures (with an oversubscription
privilege). Employees of Trans Caribbean and its sub¬
sidiaries will have the right to purchase up to 100,000
of the said 350,000 shares.
Price—To be supplied by
amendment.
Proceeds—To selling stockholder. Offi^—
Washington, D. C. Underwriter—None.

ment.

—

Sixth

Grocery Co., Gallipolis, Ohio
(letter of notification) 30,027 shares of common
stock (par $3.33 ^a). Price—$8
per share.
Proceeds—To
selling stockholders. Underwriter—Westheimer & Co.,
Cincinnati, Ohio.

class

stock

March 27 filed

(4/20-24)
$3,500,000 of senior sinking fund deben¬

—

Evans

which

to

or

Proceeds
1008

St., N. W., Washington;
Underwriter—Simmons & Co., New York.

C.

Feb.

System, Inc. (Del.)
Mar. 23 filed 350.000 outstanding shares of class A com¬
mon stock. Trans Caribbean Airways, Inc., which owns
all of this stock, proposes to give the holders of its out¬
standing class A stock, and holders of its outstanding
5%% convertible subordinated debentures, transferable
warrants, which evidence the right to purchase shares
for

unih

—14

&

C. Transit

class

per

Office

Feb. 26 filed 2.500,000 shares of

-

of

Lake

amount.

•

,

on

April 1, 1959: rights to expire on April 20. Price—$21.75
per share.
Proceeds — To finance System construction
expenditures. Underwriter—Lehman Brothers and East¬

D.

Office—3800-34th St., Mt. Rainier, Md. Un¬
C. Kimball & Co., Chicago, 111., on a
best efforts basis.
■

March

Feb. 25 (letter of notification) $220,000 of 6% unsecured
debentures due April 1, 1964 and 1,100 shares of common

Price—$30

debt.

stock

Erdman, Smock, Hosley & Read, Inc. (4/7)
(letter of notification) 100,000 shares of class A
stock and 10,000 stock purchase
warrants, to be

purposes.

derwrite r—Paul

A

300,000

Price—At market. Proceeds—

offered in units of 10 shares of stock and

Finance,

City Lands, Inc., New York
Jan. 13 filed 100,000 shares of capital stock. Price—$20
per share. Proceeds—To invest in real estate. Office—

Clute Corp.
Aug. 21 (letter of notification) 300,000 shares of common
atOck (par one cent). Price—$1 per share. Proceeds—To
pay additional costs of construction; and for retirement
of obligations and working capital. Office — c/o John
Harlan Lowell, 2200 Kenton, Aurora, Colo. Underwriter
—Lowell, Murphy & Co., Inc., Denver, Colo.

•

Inc. (4/6-10)
March 9 filed $500,000 of 7% subordinated debentures,
due Jan. 2, 1974, with attached warrants for the pur¬
chase of 100,000 shares of class A common stock. Price
—At face amount (in units of $500 each). Proceeds—To
finance making of additional loans and to reduce short-

of the

stock.

Feb. 26

Denver, Colo

D.

common

common

Sept. 22 (letter of notification) 150,000 shares of class A
common stock (par 10 cents).
Price—$2 per share. Pro¬
ceeds — For repayment of loan; purchase of plant and
jffice equipment; raw materials and supplies; and fo»
working capital* etc. Office—U. W. National Bank BJdg
1740 Broadway, Denvef, Colo. Underwriter—L. A
Hue>

term

of

For investment.

Cryogenic Engineering Co.

Dalton

Thursday, April 2, 1950

.

.

• Equity Fund, Inc., Seattle, Wash..
25 filed (by
amendment) an' additional

common

Inc., New York and Chicago.

3748,120 Broadway, New York, N. Y. Underwriter
—Model, Roland & Stone, New York. Offering—Post¬
poned indefinitely.

of

(par $20). Price— To be supplied by amendment.
Proceeds—To selling stockholders. Office—145 Conklin
stock

of industrial

Room

shares

.

25

(4/21)

filed

200,000 shares of common stock (par
$2.50), of which 140,000 shares are for the account o£
selling stockholders and 60,000 shares for company's
account. Price—To be supplied by amendment. Proceeds
—For working capital and general corporate
purposes.

Underwriters—White, Weld & Co., New York: and Ditt& Co., San Antonio, Texas.

mar

General Aniline & Film Corp., New York
'
14, 1957 filed 426.988 shares of common A stock (no
oar) and 1,537.500 shares of common B stock fpar $1).
Proceeds—To the Attorney General of the United States.
fan.

Underwriter—To be determined by competitive
bidding.
Probable bidders: Blyth & Co., Inc., and The First Boe:on
Corp; (jointly); Kuhn, Loeb & Co.; Lehman
Brothers, and Glore, Forgan & Co. (jointly). Bids—

Volume

139

Number 5834

been scheduled to be

.

.

The Commercial and Financial Chronicle

.

received'

up

to 3:45 p.m. (EDT)

or

May 13 at Room 654, 101 Indiana Ave., N. W., Washing
(km 25, I). C., but bidding has been postponed.

of

debentures for each

pire

the

by

General Builders Corp., New York
Feb. 26 filed $2,131,000 of 6%

subordinated debentures,
due April 30, 1963, with detachable warrants to pur¬
chase 213,100 shares of common stock (each $100 de¬
benture will be accompanied by a warrant for the

seven

shares held; rights to

exr

Price—At par.
Proceeds—To retire
term loan indebtedness and the balance of note issued

April 14.

on

assets

as part
of the consideration for the
King Drug Co.; for capital expenditures;
working capital. Underwriter—Mer¬

company

of The

41

(1561)

and the balance for

rill, Turben & Co., Inc., Cleveland, Ohio.

shares to

public; $9 to employees.
Underwriter

stockholder.

—

Proceeds—To selling

For public offering:

Alstyne, Noel & Co., New York.
indefinitely.

Van

Offering—Postponed

Home-Stake Production Co., Tulsa, Okla.
Nov._5 filed 116,667 shares of common stock (par $5).
Price—$6 per share. Proceeds—For working capital and
general corporate purposes.
Office — 2202 Philtower
Bldg., Tulsa, Okla. Underwriter—None.

Gas Co., Inc.
/
(letter of notification) 150,000 shares of common/
(par 25 cents). Price—$2 per share. Proceeds—
Home Telephone & Telegraph Co. of Virginia
For drilling wells and working capital.
Office—632 W.
Feb. 19 filed 92,160 shares of capital stock being offered
9th St., Erie, Pa. Underwriter—John G. Cravin & Co^,
Great Lakes Natural

purchase for cash of 10 common shares at $3 per share
at any time beginning Oct. 30, 1959 to and including
April 30, 1969). The company proposes to offer holders
of its outstanding common stock and its outstanding

Feb. 12

cumulative preferred stock of record March 20, 1959, the

New York.

right to subscribe to a total of $1,631,000 of the deben¬
tures with warrants. The remaining $500,000 of deben¬
tures with warrants are to be sold to a group of pur¬

•

Markets, Inc. (4/21-23)
March 17 filed 300,000 shares of common stock. Price-—
To be supplied by amendment. Proceeds—For advance

rights to expire on April 3.
Price—At par ($5 per
share). Proceeds—To repay short-term bank loans. Un¬

chasers

rental

it Huyck (F. C.) & Sons
March 26 (letter of notification) 8,000 shares of common
stock (par $5) to be offered to eligible employees, pur¬
suant to ail Employees' Stock Purchase Plan dated Majr
20, 1955 (as amended March 6, 1959). Price—$33.50 per

»also stockholders of the company)
also to purchase certain additional
amounts of debentures with warrants if subscription
rights are not exercised in at least the amount of $500,000. Price—$100 per unit. Proceeds—To repay promis¬
sory notes, and the balance/ if any, will be added to
working capital, to be used in part to reimburse the
company's treasury for payments made upon the acqui¬
sition of land and as working capital for such building
pro j ects as the company, may undertake. Office—2413
Third Ave., New York* N. Y. .Underwriter—None.
who

(who

are

have" agreed

General Merchandising Corp., Memphis, Tenn.
Feb. 18 filed 250,000 shares/of iclass "A" common stock
,

(par one cent). Price—$10" per share. Proceeds—For
working capital and general corporate purposes. Under¬
writer — Union
Securities Investment
Co., Memphis,
Tenn.
General Telephone & Electronics Corp. (4/20)
31 filed 800,000 shares of common stock. Price—

March

To be supplied by amendment.

corporate purposes.
writers

Proceeds — For general
Office—New York, N. Y.
Under¬

Paine, Webber, Jackson & Curtis; Stone &
Webster Securities Corp.; and Mitchum, Jones & Tem—

pleton.
•

Glickman Corp.

March 13 filed 3,357,700 shares of common

stock.

Price

Proceeds — For properties, furniture,
fixture and leasehold improvements and other expenses.
Office—565 Fifth Ave., New York, N. Y. Underwriter
—Bache & Co., New York, N. Y.
—$10 per share.

Godfrey Co., Milwaukee, Wis.
March 23 filed 100,000 shares of common stock. PriceTo be supplied by amendment. Proceeds—To provide
inventory and working capital for four new supermar¬
kets in the amount of some $309,400, and to provide
fixtures and equipment with respect thereto in the
amount of $635,000; some $30,000 will be used to provide
equipment and improvements for Crestwood Bakery, a
subsidiary; and the balance will be used for investments
in controlling stock in retailer-franchised Sentry Mar¬
kets and in interim investments in sites and develop¬
ments prior to resale.
Office—4160 North Port Wash¬
ington Rd., Milwaukee Wis. Underwriter — Taylor,
Rogers & Tracy, Inc., Chicago, 111.
•

Seal

Gold

Products

Corp. (4/13-17)
March 2 filed 125,000 shares of 6V2% cumulative con¬
vertible preferred stock (par $10). Price—To be supplied
by amendment. Proceeds—To be applied towards the
balance due on a mortgage held by A. J. Armstrong Co.,
Inc.; to the prepayment of certain indebtedness secured
by accounts receivable; in prepayment of two promissory
notes; and the balance for working capital. Underwriter
—S. D. Fuller &

Co., New York.

Government Employees
Insurance Co.

Variable Annuity Life

Nov. 13 filed 2,500,000 shares
to be offered by company viz:

of common stock (par $1)
(1) to holders of common
stock (par $4) of Government Employees Insurance Co.,
on the basis of one warrant per share of stock held (1,334,570 shares are now outstanding); (2) to holders of
common
stock (par $1.50) of Government Employees
Life Insurance Co., on the basis of IV2 warrants per share
of stock held (216,429 shares are now outstanding); and
(3) to holders of common stock (par $5) of Government
Employees Corp., on the basis of Vz warrant per share of
stock held (as of Dec. 31, 1958 there were 143,703 shares
of stock outstanding and $589,640 of 5% convertible cap¬
ital debentures due 1967, convertible into shares of com¬
mon at $28.0374 per share.
If all these debentures were
converted into common stock prior to the record date,
a total of
164,733 common shares would be outstanding.
Price—$3 per share. Proceeds—For capital and surplus.
Office—Government Employees Insurance Bldg., Wash¬
ington, D. C. Underwriters — Johnston, Lemon & Co.,
Washington, D. C.; Eastman Dillon, Union Securities &
Co., New York; and Abacus Fund, Boston, Mass. Offer¬
ing—Indefinitely postponed.
•

Graham-Paige Corp.

March

11

(4/7-8)

filed

350,000 shares of 6% cumulative pre¬
ferred stock (par $10 — convertible until April, 1969).
Price—To be supplied by amendment. Proceeds—To re¬
pay bank loans incurred in connection with purchase of
capital stock of Madison Square Garden Corp. Business
—A closed-end non-diversified management investment
company.

Grant

Underwriter—Bache & Co., New York.
(W.

T.)

Co.

(4/8)

March 19 filed 320,000 shares of common
Price—To be supplied by amendment.

additional working capital requirements,
resulting from further store expansion.
Lehman Brothers, New York.

stock (par $5).
Proceeds—For
including those
Underwriter—

•

Gray Drug Stores, Inc.
March 6 filed $2,313,500 of convertible debentures due
1974, being offered for subscription by common stock¬
holders of record March 27;




1959,

on

the basis of $100

stock

fpr subscription by stockholders of record Feb. 27, 1959,

on

Greater All

American

payments, purchase of inventories. and working
capital. Business—Operates eight super markets. Office
—7814 East Firestone Blvd., Downey, Calif. Underwriter
—J. Barth & Co., San Francisco, Calif.
Grldoil
Feb.

5

Freehold

Leases

Ltd.

filed 563,600 shares

of common stock to be of¬
exchange for $2,818,000 of 5Vz% convertible
sinking fund redeemable notes, series A, due July 1,1976,

fered

in

the basis of 200 shares for each $1,000 note.

on

330 Ninth Avenue,

West, Calgary, Canada. ; j <

Office—
-

;

stock (par 10
cents). Price—At market.
Proceeds—For investment.
Office —1825 Connecticut Avenue, Washington, D. C.
Investment
Advisor
Investment
Advisory
Service,
Washington, D. C. Underwriter—Investment Manage¬
ment Associates, Inc., Washington, D. C.
—

Gulf Power Co.
6

filed

(4/2)

$7,000,000

of first

mortgage

bonds

due

Proceeds—To repay short-term bank loans
and for construction program. Underwriter—To be de¬
termined

by competitive bidding.
Probable bidders:
Halsey, Stuart & Co. Inc.; Merrill Lynch, Pierce, Fenner
& Smith; Salomon Bros. & Hutzler, and Drexel & Co.
(jointly); Eastman Dillon, Union Securities & Co.;
Equitable Securities Corp.; Kidder, Peabody & Co. and
White, Weld & Co. (jointly); Blyth & Co., Inc. Bids—
To be received up to 11 a.m.

(EST) on April 2 at South¬
Services, Inc., Room 1600, 250 Park Avenue, New
York 17, N. Y.

ern

Harzfeld's, Inc., Kansas City, Mo. (4/6-10)
March 11 filed 46,200 shares of common stock (par $4),
of which 7,500 shares are to be sold for company's ac¬
count and 38,700 shares for selling stockholders. Price—
To

be supplied by amendment. Proceeds—For general
corporate purposes. Underwriter—Stern Brothers & Co.,
Kansas

City, Mo.

Hawaiian

Electric

Co., Ltd. (4/8)
$10,000,000 of first mortgage bonds, series
K, due March 15,1989. Price—To be supplied by amend¬
ment. Proceeds—To repay bank loans and for construc¬
tion program.
Underwriters—Dillon, Read & Co. Inc.,
New York; and Dean Witter & Co., San Francisco, Calif.
March 16 filed

Heartland

Development Corp.
(letter of notification) 22,820 shares of non¬
voting convertible preference stock (par $12) to be
offered for subscription by stockholders on the basia
of one share of convertible preference stock for each
Oct.

10

23

shares

1958.
cise

of

common

stock

held

on

or

about

Nov.

1,

Stockholders will have 45 days in which to exer¬
the rights.
Price — At par. Proceeds—To repay

debts, acquisition of investments, and for general pur¬
poses.
Address—P. O. Box-348, Albany, N. Y. Under¬
writer—None.

Heliogen Products, Inc.
(letter of notification) 28,800 shares of common
stock
(par $1).
Price—$5 per share.
Proceeds—For
payment of past due accounts and loans and general
working capital. Office — 35-10 Astoria Blvd., L. I. C.
3, N. Y. Underwriter—Albion Securities Co., Suite 1512,
11 Broadway, New York 4, N. Y.
Oct. 22

Hermetic

Seal

Corp.

(4/8-9)

March 9 (letter of notification) 100,000 shares of class A
common stock (par 10 cents).
Price—$3 per share. Pro¬
ceeds—For payment of

the balance of owed moneys to
creditors; to equip a plant in the Midwest area; for a
modern research development laboratory and working
capital. Office—744 Broad St., Newark, N. J. Under¬
writer—Amos

Treat

&

Co., Inc., New York.

Hickerson Bros. Truck Co., Inc.
March 11

(letter of notification) 285,000 shares of com¬
stock. Price—At par ($1 per share). Proceeds—To
existing liabilities; for additional equipment; and
for working capital.
Office—East Tenth Street, P. O.
Box 68, Great Bend, Kan.
Underwriter—Birkenmayer
& Co., Denver, Colo.
mon

pay

Highway Trailer Industries, Inc.
Nov. 24 filed 473,000
outstanding shares of common
stock (par 25 cents). Price—At prices generally prevail¬
ing on the American $tock Exchange.
Proceeds — To
selling stockholders. Office — 250 Park Avenue, N. Y.
Underwriter—None.
Hinsdale

Raceway, Inc., Hinsdale, N. H.
capital trust certificates evidencing 1,000,000 shares of capital stock, and 2,000 debenture notes.
Price—The common stock at par ($1 per share) and the
notes in units of $500 each. Proceeds—For construction
of a track, including land, grandstand, mutual plant
building, stables and paddock, dining hall, service build¬
ing, administrative building, penthouse, tote board and
Dec. 29 filed

clubhouse.
•

share.

Underwriter—None.

Hoffman Motors Corp.

of common stock (par $1),
to be publicly offered and
10,000 shares to officers and employees. Price—$10 per

March 9 filed 260,000 shares
of which 250,000 shares are

share for each four shares

held;

Statement effective March 10.

Proceeds—For

—Rensselaer, N.

general corporate

purposes.

Y. Underwriter—None.

Office
.«.■

>

Imperial Growth Fund, Inc.
*:
March 2 filed 600,000 shares of common stock. Price—At
.

Proceeds

—

investment.

For

Office

—

quette Ave., Minneapolis, Minn. Underwriter
neapolis Associates, Inc., Minneapolis, Minn.

60

Mar-*

—

Min¬

★ Incorporated Investors, Boston, Mass.
(by amendment) an additional 3,000,00(V

March 27 filed

shares of

common

Price—At market.

stock.

Proceeds—

For investment.
•

Indiana

Feb.

April 1,1989.

one new

derwriter—None.

market.

;

Growth Fund of America, Inc.
Feb. 4 filed 250,000 shares of common

March

the basis of

26

Steel Products Co.

(4/6-10)

filed

42,193 shares of common stock (par $1)
to be offered for subscription by common stockholders!

at

the

Price

rate

of

one

share

each

for

seven

shares

heldk

To be supplied by

amendment. Proceeds—For
construction, machinery and equipment, and to provider
additional funds for working capital and other corporator
purposes.
Office—405 Elm St., Valparaiso, Ind. Under¬
—

writer—Kalman & Co., Inc.,

St. Paul, Minn.

Industrial Minerals Corp., Washington, D. C.

July 24 filed 600,000 shares of common stock (par
cent). Price—$1 per share. Proceeds—To develop
operate graphite and mica properties in Alabama.
derwriters—Dearborn & Co. and Carr-Rigdom &
both of

oiMi

anB
Un¬
Co*

Washington, D. C.f on a best efforts basis. State¬
/

ment effective Nov. 18.

„

,

Inter-Mountain

Telephone Co.
March 5 filed 399,000 shares of voting common stoclic
being offered for subscription by common stockholder®
of record March 20, 1959, on the basis of two new share*
for each five shares then held; rights to expire on April
10. Price—At par ($10 per share).
Proceeds—For re¬
duction

of

short-term

notes

to

banks.

Underwriter-

Courts &

Co., Atlanta, Ga. and New York, for 219,34L
shares; balance to be offered to two principal stock¬
holders—Southern Bell Telephone & Telegraph Co. and
Chesapeake & Potomac Telephone Co. of Virginia.
International

Bank, Washington, D. C.
$5,000,000 of notes (series B, $500,000, two3% per unit; series C, $1,000,000, four-year 4% pe*
unit; and series D, $3,500,000, 6-year, 5% per linit). Prico
—100% of principal amount.
Proceeds — For working
capital. Underwriter—Johnston, Lemon & Co., Wash¬
ington, D. C. Offering—Indefinitely postponed.
Dec. 29 filed

year,

Investment Corp. of

Florida

Oct. 9

(letter of notification) 55,555 shares of commoi*
stock (par two cents). Price—$4.50 per share. Proceeds
—For capital account and paid-in surplus. Office—At¬
lantic Federal Building, 1750 E. Sunrise Boulevard, FL

Lauderdale/Fla. Underwriter—None.
Investors

Funding Corp. of New York
$500,000 of 10% subordinated debentures
31, 1964, to be offered in units of $1,000. Prico
—At 100% of principal amount. Proceeds—For invest¬
ment. Office—511 Fifth Ave., New York, N. Y. Under*
writer—None.
: 1 :
J
/ '
•
? *
-' " »
Feb.

17

filed

due July

.

.

.

^ Investors Planning Corp. of America
March 27 filed (by amendment) an additional $21,000,000
Systematic and Single Payment Plans. Proceeds—Fotf
investment.

Itemco

Inc.

(letter of notification) 200,000 shares of common
stock (par 10 cents). Price—$1 per share. Proceeds—T®
acquire machinery and equipment and additional spac®
for test laboratories; and for working capital. Office—
4 Manhasset Ave., Port Washington, L. I., N. Y. Under¬
writer
B. Fennekohl & Co., 205 East 85th St., New
York, N. Y.
Nov. 28

—

^ Keystone Custodian Funds, Inc.
March 27 filed 90,600 shares of class A common stock,
which 37,600 shares are to be offered from time to
time by the Fund, pursuant to the terms of its Em¬
ployees Stock Ontion Plaii, and the remaining 53,000
shares will be sold for the account of a selling stock¬
holder. Price—To be supplied by amendment. Proceeds
—To selling stockholder. Underwriter—Clark, Dodge &
Co., New York.
of

ic Kimball Mines, Inc.
(letter of notification) 100,000 shares of non¬
assessable capital stock (par 10 cents). Price—25 cents
per share.
Proceeds—For mining expenses. Office—E.
1214 Nora Avenue, Spokane, Wash. Underwriter—None.
March 23

Kratter Corp.,
March

16

filed

New York
shares

2,719,950

of class A stock

and

300,000 shares of class B stock, of which a maximum oil
2,457,450 shares of class A stock are to be offered in ex¬
change for units in certain limited partnerships. Com-

Continued

on

page

4Z

42

The Commercial and Financial Chronicle

(1562)
7

Continued

from page 41

Montana

V

r

12,500 class A shares are to be issued to
Cinaba, Ltd. Office—521 Fifth Avenue, New York, N. Y.
v

,

Co., Inc., Arnett, Okla.
Dec. 23 filed 400,000 shares of common stock. Price—$2
per share. Proceeds—For machinery and equipment and
exploration purposes. Underwriter—None.
!

Lefcourt Realty

Corp.

of which
in exchange for all of
the common
Garfield, Inc., and D. G
& R., Inc.; 750,000 shares will be used for the exercise,
of an option by the company to purchase from Big
Mound Trail Corp. some 3,784.9 acres of land on oi
before May 1, 1959; and the remaining 120,000 shares are
to be sold for the account of a selling stockholder. Un¬
Jan. 29 filed 3,492,000 shared of common stock,

2,622,000

shares

were issued
stock of Desser &

derwriter—None,
Lithium Corp.

of America

March 31 filed 50,484 shares of common stock, of which

18,984 shares were sold to the underwriters in February,
1959. Price—At prevailing market price on the American
Stock Exchange at time of offering. Proceeds — For
working capital. Office — Minneapolis, Minn.
Under¬
writers—Bear, Stearns & Co. and John H. Kaplan & Co.
Little (J. J.) & Ives Co. (4/15-16)
March 18 filed 250,000 shares of common stock

(par 50
Price—$3.50 per share.
Proceeds—For addi¬
working capital to be used principally in pro¬
ducing The American Oxford Encyclopedia.
Under¬
writer—Shields & Co., New York.
cents).

tional

•

Lockwood,

Kessler &

Bartlett

Inc.

March 25 filed 150,000 shares of class A stock, of which

100,230 shares are to be offered for the account of the
company and 49,770 for account of selling stockholders.
Frice—To be supplied by amendment.
Proceeds—For
working capital.
Office—Syosset, Long Island, N. Y.
Underwriter
Francis I. du Pont & Co., New York.
Offering—Expected at end of April.
—

Lorain

Telephone Co.
(letter of notification) 1,562 shares of common
stock (no par) to be offered for subscription by stock¬
holders at the rate of one new share for approximately
Feb. 11

each

75.1729

shares

held

close

the

at

of

business

on

March 17, 1959; rights to expire on May 15, 1959. Priee

*—$32

per

share.

Office—203

Proceeds—To reimburse the treasury.
Lorain, Ohio. Underwriter—

W. Ninth St.,

None.'

L

Louisiana Power &

Light Co.

(4/14)

(par $100). Proceeds—For property improvements and
corporate purposes.
Underwriter—To be deter¬
mined by competitive bidding. Probable bidders: HalBey, Stuart & Co. Inc.; White, Weld & Co., Blyth & Co.,
Inc. and Shields & Co. (jointly); Merrill Lynch, Pierce,
Fenner & Smith, Kidder, Peabody & Co. and Harriman
Hipley & Co., Inc. (jointly); Salomon Bros. & Hutzler,
Eastman Dillon, Union Securities & Co. and Equitable
Securities Corp. (jointly); The First Boston Corp. and
Glore, Forgan & Co. (jointly). Bids — Expected to be
received up to 11:30 ami. (EST) on April 14 in Room
2033, Two Rector St., New York, N. Y.
other

LuHoc

Mining Corp.

Sept. 29 filed 350,000 shares of common stock. Price—$1
per share. Proceeds — For the acquisition of properties
under option and for various geological expenses, test
drilling, purchase of equipment, and other similar pur¬

Offices—Wilmington,
Underwriter—None.
poses.

Del.,

and

Emporium,

Pa

★ Mary Carter Paint Co.
March 30 (letter of notification) 37,500 shares of com¬
mon stock
(par $1) of which 25,000 shares are being
offered by the company, out of authorized but unissued;,

stock, and 12,500 shares

being offered by John F.
Crosby, Spring Lake, N. J. Price—$8 per share. Proceeds
—For payment of
outstanding loans and working capi¬
tal, and to selling stockholder. Office—Gunn Highway
at Henderson Rd., Tampa
7, Fla. Underwriter—W. W.
Schroeder & Co., New York 5, N. Y.

i Meadow Brook

are

Club

March

26
(letter of notification)
400 certificates of
beneficial interest (stated value
$500 each) to be offered
to members of the club. Price—At
par ($500 per

Proceeds—For construction
etc.

of

a

permanent

unit).
clubhouse,

Office—Westbury, N. Y. Underwriter—None.

Mergenthaler Linotype Co., Brooklyn, N. Y. (4/7)

March

17 filed 116,541 shares of
capital stock, to be
offered for subscription by stockholders at the rate of
one new share for each four shares held
of record April
$, 1959; rights to expire on April 24 (with an oversub¬

scription privilege). An additional 29,900 shares are
being or will be offered pursuant to the company's
Employee Stock Option Plan. Price—To be supplied
by

amendment. Proceeds—To be added to the
general funds
of the company and be used for
corporate purposes.

Underwriter^-None.

poses.

Office—1404 Northwestern Bank Bldg., Minne¬

apolis, Minn.

Underwriter—None,

Millsap Oil & Gas Co.
Dec. 23 filed 602,786 shares of

stock.

Price—$1




share for each four shares held. Price—To be

new

one

York.

tional

ic Moog Servocontrols, Inc. (4 20-24)
;
shares of common stock, of which
70,000 shares are being sold by certainj selling stocks
holders and 60,000 shares by
company^(10,000 shares ;
to employees and 50,000 shares to public). Price—To be y
supplied by amendment. Proceeds—For working capi¬
tal.
Office—East Aurora (Buffalo), N Y. Underwriters :

received up to 11 a.m. (ED7 :
Aug. 27.but company on- Aug. 22 decided to deter
pending improvement in market conditions. SEC
on Feb. 25, 1959 extended to June 16, 1959 period within
which company may consummate financing.

Perfecting Service Co.
((letter of. notification) 28^250 shares of common
offered for subscription by stockholders on
,

Feb. 26

tional Telefilm will receive $11

principal amount of de¬
purchase warrant for one-quarter share of
National Theatres stock in exchange for each share ol
National Telefilm. For each outstanding warrant of Na¬
tional Telefilm, the holder will receive an exchange war¬
rant for the purchase of $11 of debentures and a warrant
for the purchase of one-quarter share of National The¬
atres common. The offer, which expires April 6, 1959,
has been declared effective. Dealer-Managers — Cruttenden, Podesta & Co., Cantor, Fitzgerald & Co,, Inc.,
a

\

:

,

■/.7>-;;

Natural Gas Pipeline Co. of America (4/9)
March 18 filed $20,000,000 of first mortgage pipeline
bonds due 1979.
Price—To be supplied by amendment.
Proceeds—Together with other funds, to pay outstand¬
ing bank loans. Underwriters—Dillon, Read & Co. Inci
and Halsey, Stuart & Co. Inc., both of New York.
*
,

Shipbuilding Corp.

/ To be supplied by amendment. To be offered from time
the New York Stoek Exchange at price

prevailing at time of sale or by public: or private sale
prices. Proceeds — To Merritt
Chapman &
Scott Corp., the selling stockholder. Underwriter—None,

at related

New
March

20

offered

-

York

Shipbuilding

filed

Corp.

83,334 shares

of

common

stock, to

be

in exchange for common stock of
Higgins, Inc.,
one share of New York
Shipbuilding com¬

at the rate of
mon

first mori

5%

sale

r*'»''V

sinking fund subordinated
1, 1974, stock purchase warrants
for 454,545 shares of common stock (par $1) and 485,550
warrants to purchase debentures and stock purchase
warrants. The debentures and stock purchase warrants
are being offered in exchange for National Telefilm As¬
sociates, Inc. common stock and outstanding stock pur¬
chase warrants. Basis of Exchange—Shareholders of Na¬

on

of

on

stock to be
a

debentures due March

to time either

like amount

had been expected to be

.

New York

,

bonds due; 1987. Underwriter—To be determined
by competitive bidding. Probable bidders: Halsey, Stuai ,"f& Co. Inc.; Kidder, Peabody & Co.; While Weld & Co
EquitafHe Securities Corp., and Shields & Co* (jointly),
Lehman Brothers, Eastman Dillon, Union Securities 8
Co., Salomon Bros. & Hutzler and Ladenburg, Thalmam,
& Co. (jointly);. Merrill Lynch, Pierce, Fenner & Smith;/
and-Dean Witter
Co. (jointly). - Bids — Ten tali vel;. •/'

ic National Life & Casualty Insurance Co.- ; > --25 filed 250,000 shares of common capital stock
to be offered to holders of certain of company's life
insurance policies issued on or prior to Dec. 31, 1955,
and to certain employees.
Price—$4.44 per share/ Pro¬
ceeds—To increase capital and surplus.: Office — 2300
North Central Ave., Phoenix, Ariz. Underwriter—None.

Westheimer & Co.

t-*:*

••

Proceeds—To redeem -a

March

and

V"<-n

gage

—Kidder, Peabody & Co., New York; and Blunt Ellis
& Simmons, Chicago, 111.
;■:»\J..";J.■;';■ ^

bentures and

loans. •Underwriter—Bear.

of

Pennsylvania Power Co*
Aug. 1 filed $8,000,000 of first mortgage bonds due 1989.

March 30 filed 130,000

National Theatres, Inc.
Dec. 30 filed $20,000,000 51/2%

Proceeds — To purchase addir
Fairbanks, Morse & Co. and for repay¬
Stearns & Co., New

stock of

ment

.

rata

pro

($10

basis^vRighjs expire in 15 days. Price—At par
share.):-Proceeds—For accounts receivable and

per

Office—332

inventories.

Underwriter—None.

Atando

;V ''n

Ave., Charlotte, N.

C.

../;.-?.A;

,

^ Permachem Corp.,* New York
2,041,331 shares of class A common stock
(par 10 cents) and 1,917 shares of class B common stock
(par 10 cents). This covers the transfer of certain shares,
pursuant to option, agreements. Price — At over-theMarch 31 filed

counter

market/prices-. Underwriter—None.

'

Peruvian Oils &

Minerals, Ltd.
March 12 filed "400;000 shares of capital stock.
Price—.
At the prevailing market.
Proceeds—To selling stock¬
holders., Office
85 Richmond Street West, Toronto,
Ont., Canada. Underwriter—None.
/
—

.

Philco Corp.

■

,

(4/16)
March 26 Tiled. $20,000,000 of convertible subordinated
-

debentures/ due' -April 15, 1984.

Price—To be supplied
Proceeds—For capital expenditures and
general corporate purposes. Underwriter—Smith, Bar¬
ney & Co., New York. "
:
'
"
!
by amendment.

.

.

^ Producers Fire & Casualty Co., Mesa, Ariz.J
March 31 filed .'400,000, shares of common stock to be
offered for subscription by holders of stock purchase
rights acquired in connection, with life insurance policies

s.

issued by Dependable Life Insurance Co. and to certain

agents

and brokef-s^of. Producers

Price—$5

per

Prudential

.

Fire

s^shareA Proceeds—For

Undenvriteri^Ndh'e.': W'

&

Casualty Co.

working

7r

capital.
,

Enterprises, Inc. A,.?"-

/-7. ,

Jan. 15 (letter of notification) 200,000 shares of common
stock (par one,-cent) of; which 170,000 shares are to be; *
sold by the/cpfhpany and 30,000 shares:by a
selling
stockholder. ^ Price — $1.50 per share. Proceeds — For

expansion and working capital. Office—1108
Street, n!W.;:-Washington 6, D. C. Underwriter-4
Co.,' Washington, D. C> *
'; / !

general
16th

for each 24 shares of Higgins common:

John C. Kahn

Oak Ridge, Inc.1"..
Sept. 4 (letter of notification) 100,000 shares of commoi
stock (par $1). Price — $3 per share. Proceeds — Foj
working capital.
Office—11 Flamingo Plaza, Hialeah
Fla.

Underwriter

Henry
mingo Plaza, Hialeah, Fla.

&

—

Associates, Inc.,

11

Fla

Oil, Gas & Minerals, Inc.
Nov. 16 (letter of notification) 116,000 shares of commoi
stock (par 35 cents).
Price—$1 per share. ProceedsFor development of oil and
gas properties.
Office—61?
International Trade Mart, New Orleans 12, La. .Under

writer—Assets Investment Co., Inc., New
Orleans, La.

Oppenheimer Fund, Inc.
Dec.

5

filed

market

100,000
(about $10

shares of capital stock. Priee—A>
share). Proceeds—For invests

per

ment. Office—25 Broad St., New York.
Oppenheimer & Co., New York, ../

,

★ Organics, Inc.

Underwriter—'

;

March 20

(letter of notification) 150,000 shares of com¬
mon stock
(par $1). Priee—$1.25 per share. Proceeds—
To pay outstanding debt and for additional
working cap¬
ital.

Office

—

1221

Mile

High Center, Denver 2, Colo.

Underwriter—None.

„" I

.

...

1989.

Proceeds—For construction

—To

be

program. Underwriter
by competitive bidding. Probable
bidders: Halsey, Stuart &. Co. Inc.; The First Boston
Corp.; Blyth & Cp., Inc. and;Smith, Barney & Co. (joint¬
ly); Harriman Ripley & Co. Inc., Eastman Dillon, Union
Securities & Co., Merrill Lynch, Pierce, Fenner & Smith
Inc. and Dean Witter-& Co. (jointly); Lehman Brothers,
Kidder, Peabody & Co. and White, Weld & Co. (jointly).
Bids—Expected .to be received up to 11 a.m. (EDT) on
April 28.V'V tV?" r-

determined

ir Purepac Corp., New York - r
;
shares of common stock (par five
cents). Price—$3 "per share. Proceeds—To repay loans
and for general-corporate-purposes.' Underwriter—RichT
&

Bruce

Co. :Inc.

.

/V

•

-

shares of common /
Proceeds—To prove
construction. Office—At

up

and. for- road, and camp

ore

Suite 322, 200 B?y

5t., Toronto, Ont., Canada, and c/o T.
Arnold,- Wilson Circle, Rumson, N. J. Underwriter^
Cq^.-New.York,: N. Y.
.
)

of $500 arid $1,000:. Price—At par.

B

stock-evidenced

common

by

a

voting

ground equipment
working capital. Address—P, O. Box 6007, Lam¬
bert Field, St. Louis 21, Mo.
Underwriter—None, but
Newhard, Cook and Co. and Yates, Heitner & Woods,

and for

both

of

St.

Louis, Mo., offered to purchase the unsub¬

scribed shares.

,

;

.

;

Calif.

Underwriter—Paramount Mutual
Co

Fund

Manage¬

.

Peckman Plan Fund, Inc., Pasadena, Calif.
May 19 filed 20,000 shares of common stock (par $1)
Price—At

market.

Proceeds—For

Rassco Financial

investment.

Under

writer—Investors Investments Corp., Pasadena, Calif.

Corp.

-

.

June 26 filed $1,000,000 of 15-year 6% series A sinkini
fund debentures due 1973, to be offered in--denomination*

Proceeds—For work-;
Ing capital and general/corporate purposes. Underwrite)
—Rassco Israel Corp.,. New York, on; a "best effort*'1,

basis!:

- ^
v
'• •"
jr Reiter-Foster Oil Corp.
,

March
due

30

filed

1969, to

stockholders
debentures
To

Paramount Mutual Fund, Inc,
Jan. 2 filed 300,000 shares of capital stock. Price—Mini ¬
mum purchase of shares is
$2,500. Proceeds—For invest-.
ment. Office—404 North Roxbury
Drive, Beverly Hills

..

stock (par $1). Trice—$1 per share.

and/or

class

*

Raindor Gold Mines, Ltd. /
Jan. 28 (letter of notification) 290,000

Sano &

certificate, one share of general common stock for
each 20 shares of class A arid class B common stock of
record April 14, 1959. Price—$4.25 per share. Proceeds
—To purchase additional flight and

*

March 31 filed 260,0.00

* Ozark Air Lines, Inc. (4/14) /
March 24 (letter of notification) 59,825 shares of
gen¬
eral common stock (par $1) to.be offered for
subscrip¬
tion by holders of class A and class B common stock
trust

?

Public. Service Co. of Colorado (4/28) ' ; '
March 26 filed, $20,000,1)00 of first mortgage bonds due

ard

.

.

common

of

Smith, Barney & Co., Kidder, Peabody & Co. and Blvth
Co., Inc. Offering—Indefinitely postponed.

&

ment

share. Proceeds -—For additional
working capital.
Office—Siloam Springs, Ark. Underwriter—None.
per

be
subscription by common stockholders at rate

supplied by amendment.

.

Midwest Technical
Development Corp.
March 17 filed 400,000 shares of common stock.
Price—
$3.75 per share. Proceeds—For general corporate pur¬

March

offered for

price on the New York Stock Exchange. Proceeds—To¬
gether with other funds, to carry on the company's con¬
struction program
through 1959.
Manager-Dealers —

March 3 filed 621,353 shares of common stock. Price—

March 3 filed 75,000 shares of cumulative preferred stock

* Penn-Texas Corp., New York City
31 filed 1,500,000 shares of common stock to

'

Price—To be related to the current market

it Montana.

maining

Laure Exploration

Co.

July 1 filed 100,000 shares of common stcdk (no par).
The stock will be offered only to bona fide residents

pany sold on March 14 a total of 250,000 class A shares
at $10 per share, and on March 4 a total of 300,000 class
B shares at $1 per share to certain persons; the* re¬

Underwriter—None.

Power

Thursday. April 2, 1959

...

"

•<'

•

..

-7

V. ;
-

* *

•

-

$1,500,000 of 6% convertible debentures

be:? offered
at the. rate

for

V.-,
-

each

300

for subscription by .common;
of -AlOO ;principal amount of
shares held. Price—7

common

be

supplied by^amendment. Proceeds—To pay debf
development of present properties and acquisi¬
tion and development of additional oil and gas proper^
ties. Underwriter—Emariuel Deetjen & Co., New York!
and for

i Republic Foil Inc. (4/20),
March 26 filed-70,196 shares of common stock, to be
offered for subscription by holders of outstanding shares
upon the basis of one new,share for each three shares ~
held on or about April 20, 1959; rights to expire on or
about May 4. Price—To be- supplied by amendment:
Proceeds—For property and equipment, to retire bank

.

Number 5834

189

Volume

.

.

The Commercial and Financial Chronicle

.

working capital. Office—55 Triangle St.,
Under writer-r-Laird & Co., Corp., Wil-'

loans, and for

Del.

mington,
•

'

.

/
Inc.

Investing Fund of America,
shares ol capital stock. Price—Ai
Proceeds—For investment
Offcice—Englewood,

Research

basis

filed 200,000

24

Feb.

market.

vertible

shares

30,000

filed

6

March

(4/8)

Co.

Finance

Ritter

6%

(par $50).

stock

preferred

of

cumulative

sup¬

•

Co.,

Finance

Ritter

stock

(4/8)

2o,000

rights

to* expire

share.

(with

May

on

Proceeds—To

•

15,

repay

loan

bank

Routh Bobbins

23

Price—$j

filed

at the rate of one new

April 1, 1959.

on

Scranton

Proceeds—For

★

v

80,000 shares of

rate of

one

March 30, 1959;

on

unit for each

25 shares

of stock held

rights to expire April 15. Price—$200
repay bank loans.
Underwriter
♦

lines and acquisition of new

related lines.

17

Bridge St., Watertown, Mass.
Morgan & Co., New York'. " Sept

Insurance

Co

(letter of notification J 3,567 shares- of commoj
(par $D
Price—$18.75 per share
Proceeds—T<

;

ate

Corp.

,

..

%

..

.

:

C

>

par

one

the

right

to

subcribe

added

fpr

to

the

general

general

corporate

funds of
purposes.

the company and used
Underwriter—None.

common

suant thereto.

which

stock
'

may
•

be

acquired

'

Offering—Date

Park

and

Allen

&

Co.,

both

pur¬

_

the

rate

of

new

comipon
share for

working

capital.

Underwriter—None.

March

filed 177,626

13

shares of

(4/3)
stock

(par 50 1
cents), of which 161,628 shares are to be offered for
subscription by common stockholders of record April 3,"
1959, on the basis of one new share for each 15 shares^
then held; rights to expire on April 21. Employees will"
be offered the privilege of subscribing for 16,000 shares i
up to 3:30 p.m.
(EST) on April 16. Price—To be sup-,
plied by amendment. Proceeds—To be loaned to a sub¬
sidiary, Western Massachusetts Electric Co., which will '
be

used

to reduce

for

its

construction

Boston

its

common

short-term bank

Proceeds—For

repayment

of a

balance

j

borrowings, and*

Underwriters—The First

program.

Corp. and White, Weld & Co., both of New York.

Western Wood Fiber Co.

i

stock

common

(par $10)

K

j
*

and

40,000 shares of preferred stock (par $25). Price —
At par.
Proceeds—For destruction and equipment of
company's plant and for Vorking capital. Office—300:
Montgomery St., San Francisco, Calif. Underwriter—
None.

Wisconsin Power & Light Co.

(4/15)

March 9 filed

$14,000,000 of first mortgage bo^ds, series,
J, due March 1, 1989. Proceeds—To pay part of the cost,
of property additions and improvements. Underwriter—
To be
determined by competitive
bidding. Probable
bidders: Halsey, Stuart & ,Co. Inc.; Smith, Barney & Co.'
and Robert W. Baird & Co. (jointly); Equitable Securi-^
ties Corp. and Eastman Dillon, Union Securities & Co.
(jointly); White, Weld & Co., Kidder, Peabody & Co.
and Salomon Bros. & Hutzler (jointly); The First Boston/
Corp.; Blyth & Co., Inc. and Lehman Brothers (jointly)/
Bids—Expected to be received up to 10:30 a.m. (CST) on"
April 15.
■■■./. •1
★ Wometco Enterprises, Inc.
March 27 filed 325,000

(4/20-24h

shares of class A

of which 2.90,000 shares

are,

—

common

stock,

,

to be offered to public and

35,000 shares to officers and employees.of the company.,
Price—To be supplied
by amendment.
Proceeds—To?
selling stockholders. Business—Operates motion picture
theatres, and television and radio stations. Office—306
Miami

North

Ave., Miami, Fla. Underwriter—Lee Hig- /
Corp., New York.

ginson

Wyoming Corp.
Nov. 17 filed 1,449,307 shares of common stock.

Of these

shares

1,199,307 are subject to partially completed sub¬
scriptions at $2, $3,33 and $4 per share; and the addi-;
tional 250,000 shares are to be offered initially to share¬
holders of record Nov. 1, 1958, in the ratio of one new
share for each 2.33 shares

held on that date. Price—$4
Proceeds—$300,000 will be used for payments
on contract to purchase shares of International Fidelity
Insurance Co.; $325,000 for capitalization of a fire insur¬
ance company; $500,000 for capitalization of a title insur¬
ance company; $500,000 for additional capital contribu-.
tion to Great Plains Development Co.; and $300,000 as

share.

per

an

additional capital contribution to Great Plains Mort¬

Office—319 E. "A" St., Casper, Wyo.

Co.

gage

writer—None.

Under¬

,

.

.

for workig

capital and general corpor¬
Address—Postal Station R, Toronto, Ont.,

Prospective Offerings
Alabama Power Co.

Development Corp.,

(4/30)

company plans the Of 30-year first mortgagebonds. Proceeds — For construction program. Under¬
writer—To be determined by competitive bidding. Prob-;

it

10

Dec.

Issue

and

was

sale

announced

that the

of $20,000,000

able bidders:

★ United Improvement & Investment Corp.
25 filed 1,238,994 shares of common stock
(par
$2.60), of which 809,195 shares are to be offered in
exchange for outstanding stc^rk of Lawyers Mortgage &
Title Co. on the basis of one share of United for each
-

four

shares

reserve

Inc., Philadelphia, Pa.
March 31 filed 200,000 shares of common stock. Price—
$2 per share. Proceeds—To pay loans and for new equip¬
ment. Underwriter—Sano &
Co., New York.

at

^Western Massachusetts Companies

of

indefinite.

Ltd.

debentures.

purposes.

.

★ SiprN Snack Shoppes,




Co.

March

Corp.
March 27 filed $16,000,000 of participations in the com¬
pany's Employees' Savings Plan, together with 200,000
of

debentures,

Halsey, Stuart & Co. Inc.; Lehman Broth¬
Eastman Dillon, Union Securities & Co., Equitable
Co. (jointly); Harriman,
Ripley & Co., Inc. and Goldman, Sachs & Co. (jointly);
Morgan Stanley & Co.; Blyth & Co., Inc. and/Kidder,
Peabody & Co. (jointly); The First Boston Corp. Regis-,
tration—Planned for April 3. Bids—Expected to be re- ^
ceived on April 30.
'
^
ers;

Securities Corp. and Drexel &

.

★ Sinclair Oil

shares

&

★ United Gas Corp.
$12,600,000 of participations in the Em¬
ployees Stock Purchase Plan of United Gas Corp., United
Gas Pipeline Co.,/. and Union Producing Co., together
with 300,000 shares of United Gas common stock which
may be acquired pursuant to the plan.

additional .Capital

one

various

March 26 filed

Share for each Capital
Share held (with an additional subscription privilege).
Price—To be supplied by amendment. Proceeds—To be
or

its

thereto.

for

additional American Share for each American Share

held,

with

★ Union Carbide Corp.
March 27 filed $30,000,000 of participations in the Sav¬
ings Plan for Employees of Union Carbide and its U. S.
subsidiaries,/together with 50,000 shares of Union Car¬
bide capital stock which
may
be acquired pursuant

(two American shares-represent

possessions,

connection

Investment'Planning Co., Washington, D. C.

>

capital share).
The company:proposes to offer
holders of its American shares on April 13, 1959, and
holders of its capital shares in the United States, its
and

in

(letter of notification) 300,000 shares of com¬
mon
stock. .Price—At par
($1 per share). Proceeds—
For development of oil properties.
Underwriter—First

one

territories

used

March 20

value 5,000 French francs (U. S. $10.12) per share, and
equivalent 2,000,000 American shares representing such

capital shares

(par $1).;

Mangum, Okla.

Name-

SIMCA Societe Anonyme, of France (4/13)
March 24 filed 1,000,000 shares of capital stock,

1;000,006

the

the

1033-30tb

Former

,

be

Transcon Petroleum &

St., N. W., Washington 7, D. C, Investment Advisor—In¬
vestments Fund /Management
Shares in America, Inc.
.

„

Canada. Underwriter—Bache & Co., New York. Offering

Price—At

—

(par $1)

stock

days>)JPrice—To be supplied by amendment. Proceeds*

—Expected this week.

Dec.

iriarketu Proceeds—For investment. Office

York.

on

and

,

Shares in American Industry, Inc.
12 filed 50,000 shares of common stock.

stock

loan; to retire all of the company's current bank loans;

selling stockholder Office—400 W : Vickery Bivd
Fori Worth. Tex
Underwriter—Kay & Co.. Inc.. Hous
ton, Tex..
'/
.;/•,; 4•.'.
: %/ - .•
.

will

Thorncliffe

est

go to a

.

common

be

(Canadian) of sinking fund de¬
bentures, series A, due March 1, 1974, and 80,000 shares
of common stock, to be offered for sale in units, each
consisting of $1,000 of debentures and 20 shares of comrnon
stock. Price—$1,000 per unit, plus accrued inter¬

26

dock

Corp.

supplied by .amendment. Procecds-^/For
repayment of the company's 5% notes held by an Amer¬
ican bank, and the balance will be added to its general

★

:~v'" ■4:'

:

bnd

March 5 filed 100,000 shares of

Feb. 20 filed $4,000,000

Office—

Underwriter—Peter
' f•

.

Service Life

ores.

★ Thermo Plastics Corp.
March 26 filed 468,500 shares of common stock. Price—
At par ($1 per share). Proceeds—For purchase of neces¬
sary capital equipment and to increase working capital.
Office—1.626 Hertford Rd., Charlotte, N. C. Underwriter
—Interstate Securities Corp., Charlotte, N. C.

t Seaboard Flywood & Lumber Corp. (5/15)
March 27 filed 150,000 shares of common stock. Price—
$3 per share. Proceeds—For expansion of present prod¬
uct

Price—To

New

unit.1 Proceeds—To

per

—rAllen & Co., New York.

Petroleum

Underwriters—Bache

$200 of debentures and warrants for the purchase of two
shares of stock for subscription by common stockholders
at the

Texfei

funds and

stock) being offered in units of

common

William
Underwriter-

operations, and for general corporate purposes, includ¬
ing payment of purchase obligations on certain prop¬
erties, and for* the purchase of warehouse inventories.
Office—Republic National Bank Bldg., Dallas, Texas.

Brook Water Service Co.

Spring

manganese

March 19 filed 550,000 shares of

1, '1934 with common rtock warrants to purchase
chares of common stocks being offered in units of

80.0on

using the Bruce

—

common

faciuiiej, for purchase of equiphient;
working capital and other corporate purposes./Office—
202 South Division St.. Northfield, Minrr.
Underwriter
-r-Craig-Hallum, Inc., Minneapolis, Minn.- " '•/
•

Proceeds—To erect and operate one or mor«

.

incite,pJa.it

April

v

★ Texas Eastern Transmission Corp. (4/9)
March 26 filed $45,000,000 of first mortgage pipe line
bonds due 1979. .Price—To be supplied by amendment.
Proceeds
For construction program.
Underwriter —
Dillon, Read & Co. Ific., New York.

to present

Price—$10 per share.

20

beneficiate

248,394 shares of capital

pffered for subscription by holders of

each four common shares held and "eight shares for each"
$100 of debentures held (with an oversubscription privi-'
lege). The record date will be the fourth business day
following the effective date of the registration state¬
ment and the subscription period will be approximately

''

processing plants

filed

4

be

stock

(4/7)
March 18 filed 440,000 shares of cumulative convertible
second preferred stock (par $100). Price—To be supplied
by amendment. Proceeds—To be used in part to retire
the company's outstanding short-term notes issued under
the company's revolving Credit Agreement, the proceeds
from which were used in the expansion of the com¬
pany's properties; and the balance will be added to the
general funds of the company and be used for further
expansion of properties. Underwriters—Stone & Web¬
ster Securities Corp. and White, Weld &
Co., both of
New York."
•
•'
* '/"
•
'

"

of

to

Tennessee Gas Transmission Co.

stock, which
stockholders
share for each eight shares held

42,500

March

on

—For

to

stock.

common

.March 31 filed

share.

per

,

\

offered and sold first

to be

are

*

af $5

The company

Victoreen Instrument Co.

★ Super-Sol Ltd.
25 filed 250,000 shares of common stock. Price—
par
(19,800 Israeli pounds—equivalent to $11 per
share in U. S. funds), payable up to 90% in State of
Israel Independence Issue and Development Issue Bonds, *
and the balance in cash. Proceeds—For expansion pro¬
gram.
Office — 79 Ben Yehuda St., Tel Aviv, Israel.
Underwriter—American Israel Basic Economy Co., New
York, N. Y. '
•
V"

^ Santa's Village, Skyforest, Calif.
v;
6% convertible subordinated
sinking fund debentures due 1974. Price—At--100% ofprincipal amount. Proceeds — For completion of East
Dundee Village (a new amusement park near Chicago);
and for working capital and other corporate purposes.

March

of

March

March 27 filed $800,000 of

Co.
shares

of

At

★ St. Regis Paper Co.
March 27 filed 58,000 shares of common stock (par $5)
to be offered in exchange for outstanding common stock
of Cupples-Hesse Corp. on the basis of .644 of-a share
of St. Regis common for each share of Cupples common.
St. Regis will declare the exchange offer effective if
100% of the outstanding shares of Cupples stock is de¬
posited in exchange, and may elect to do so if a lesser
percent, but not less than 80%, is deposited.

(G. T.)

'

1959

Southwest Shares, Inc., Austin, Texas.

share.
Proceeds — For investments and working
capital. Business — Real estate investments." Office Alexandria, Va. Underwriter—None.

Schjeldahl

'

16,

per

per

Underwriter—None.

both

Co.

Service

and

Investment Corp.

shares of common stock.

March

record

'*

chemical

the purpose of extending distribution facilities.
Office123 Church Avenue, Ptoanoke, Va.
Underwriter—None.
w

Inc.,
•

.

and

per

fpr installation and construction of additional mains for

Jan. 29 filed 475,000

Electric

Process

Price—$16.75

1959.

short-term

/

$2,000,000 of first lien mortgage 6% houd
975,000 shares of common stock (par 10 cents).. Prie*
—For bonds, 95% of princmal amount; and for stock $1

oversubscription privilege);

an

Allyn & Co.,

•

Strategic Minerals Corp. of America, Dallas, T«,

★ Roanoke Gas Co.
19 (letter of notification) 17,732 shares of com¬
mon
stock (par $5'
o be offered for subscription by
common stockholder jn the basis of one share for each
shares held

of

—None.

.

March

seven

/

the basis of one
new
share for each 30 shares now held; rights to ex¬
pire on April 3/ Price—$16 per share (estimated). Pro¬
ceeds—For construction purposes. Office—1012 Mercan¬
tile National Bank Building, Dallas, Texas. Underwriter

.

(

and A. C.

'

(letter of notification) 14,126 shares of common
(par $1) being offered for subscription by stock¬

holders

shares of class B common stock!
(par $1;.
Price—To be supplied by amendment. Pro-,
ceeds—To selling stockholders.
Underwriter—Stroud &/
Co.,. Inc.,. Philadelphia, Pa.
/ ;
iuea

o

Underwriters—Snow, Swee¬

program.

Inc.,

March 3

.

.

Co.,

York.

Southwestern

plied by amendment. \ Proceeds—To be added to the
general funds of the company and initially used to re¬
duce temporary notes payable to banks.
Underwriter—
Strogd Si Co., Inc., Philadelphia, Pa,
;
V
Mami

&

New

con¬

Price—To be

subscribe to 242,share, on a one-for-four
also proposes to offer 187,500 shares
in exchange for all the outstandipg^eommon stocks of
Margate Homes, Inc., Broward Engineering Co., and
Margate Construction Co., certain outstanding debt ob¬
ligations of Margate Homes, Inc., and $62,500 in cash.
Proceeds—For working capital and
general corporate
purposes.
Office—25 West 43rd St., New York, N. Y.
Underwriter—Allen & Co., New York, for 242,299 shares
basis.

one
sjiare of preferred for each five common
held; rights to expire on May 1. Price—At par
per share).
Proceeds—To repay bank loans and

construction

ney

.

43

United's offer will have privileges to

299 additional shares

of

($25
lor

Inc.
•

Co.
(4/1Q)
shares of cumulative convertible

shares

Underwriter—First Mutual Securities of America

N. J.

Gas

filed 442,731

19

second preferred stock to be offered for subscription by
common
stockholders of record April 10, 1959, on the

:

.

Union

Southern

March

Danbury, Conn.

(1563)

of

Lawyers

before

its

recent

one-for-ten

split, or 1\L> shares of United for each share
after such split. Lawyers' stockholders may

of Lawyers
round

out

their

allocation

to

the

next

full

share

by

purchasing not more than 3A of a share at $1.25 |or each V\ share needed. In addition, a stockholder Who accepts

Arkansas

Western

Gas

Co.

(5/1)

was reported that company plans issuance?
$1,000,000 of convertible subordinated deT ,
Proceeds—Together with other funds, will be
used to retire about $550,000 of bank loans and for ex-*
pansion program.'Underwriters—Snow, Sweeney & Co.-

March

and

16 it

sale

of

bentures.

w

Inc., and A. C. Allyn & Co., Inc., both of New York."
Registration—Expected end of March.
★ Bank of-Commerce, Washington, D.
Feb.

26

stockholders

C.

(5/29)

of the Bank approved the sale of

shares of capital stock (par $100) to holders of
record May 29, 1959, on the basis of one new share for
each three shares held; rights to expire on June 30.
2,000

Price—$150

311(1 surPius-

per

share.

Proceeds—To

increase

capital

Continued On page

44

(

44

,

The Commercial and Financial Chronicle

(1564)

Continued jrom page

the

31

Illinois

(5/12)
filed an application with the
Commission for authority to issue

Illinois Light Co.

Central
March

poration is planning to sell additional shares eft common

43

Edison Co. of Kl. Y. Inc. (5/26)
reported that the company plans to issue

,Consolidated

$50,000,000 to $60,000,000 of ftrst refunumg mort¬

end sell

gage bonds. Proceeds—For additions, improvements, etc.
Underwriter—To be determined by competitive bidding

bidders:

Probable

Halsey,

Co. Inc.;

Stuart &

Gas Co.

Natural

of

share

new

one

each

for

10

shades held; rights to

or

on

None.

March 18, James Comerford, President,

of debentures.
Proceeds—For construction'
Underwriter—To be determined by competi¬
tive bidding.
Probable bidders: Halsey, Stuart & Co.
Inc.: Morgan Stanley & Co. and The First Boston Corp,
(jointly); White, Weld & Co. and Paine, Webber, Jackeon & Curtis (jointly).
program.

sale

of

Duke

reported that the company plans to
$6,000,000 of first mortgage bonds. Under¬
writer—To be determined by competitive bidding. Prob¬
able bidders: Halsey, Stuart & Coi Inc.; Blyth &
Co., Inc.
and Salomon Bros. & Hutzler (jointly); Merrill
Lynch,
Pierce, Felnner & Smith Inc.; Kidder, Peabody & Co.
and Lehman Brothers (jointly). Bids—Expected to be
received some time in May.

reported that the company plans issue

$947,200

reported that the

was

company

termined

El

Paso

Feb. 9 it

Electric

Co.

(5/19)

reported that the company is planning the

was

eale of $3,500,000 of first mortgage bonds due 1989. Pro¬
ceeds—For construction program. Underwriter—To be
determined by competitive bidding.
Probable bidders:

Halsey, Stuart & Co.; Merrill Lynch, Pierce, Fenner &
6mith, Inc.; Stone & Webster Securities Corp.; Kidder,
Peabody & Co.; White, Weld & Co. and Shields & Co.
(jointly) Equitable Securities Corp. and R. W. Pressfarich & Co. (jointly). Bids—Expected to be received
up to
El

11

(EDT)

a.m.

Paso

Electric

was

Eastman Dillon, Union Securities & Co.; Salomon
Bros.
& Hutzler & Co.; Kidder, Peabody & Co., and
White,
Weld & Co. (jointly); Merrill Lynch,
Pierce, Fenner &

6mith.

(EDT)
El

Bids
on

Expected to be received
May 19.

Paso

Feb. 9 it
en

—

Electric Co.

to

up

11

stockholders
25

the

on

shares held

subscription

basis
as

of

about

one

new

share

of

May 11, 1959 (with
rights to expire on

privilege);

an

for

over¬

May

26.

Proceeds—For construction program. Dealer-Manager—
Stone & Webster Securities

Corp., New York.

El

Paso

March 4 it
vote

on

Natural Gas
was

on

authorized

preferred stock to
shares, and the commoi)

1,000,000 shares from 472,229
to 25,300,000 shares from
20,300,000 shares. Pro¬
ceeds
For major expansion
program. Underwriter —
White, Weld & Co., New York.
—

March 31 it
an

Mechanical

was

Specialty Co.

(Calif.)

—

Registration

—

Via

Regulation

"A," around April
Offering—Expected early part of May.

15.

★ First National Trust & Savings Bank of
San

Diego, Calif.

March 27 it
its

was

stockholders

(4/21)

announced that Bank
of

plans to offer to

record. April

21, 1959 the right to
subscribe on or before MayTl, 1959 for
105,000 additional
shares of capital stock on the basis of one new share for
each nine shares held

(following proposed two-for-one
Underwriters—Dean Witter & Co.; Blyth &
Co., Inc.; William R. Staats & Co.; Eastman Dillon, Union
Securities & Co.; and Dewar & Co.
Stock split).

Florida

Power

Corp.
Feb. 4/W. J. Clapp, President, announced that the




construction

Light Co.

program.
Underwriter—To be deter¬
mined by competitive bidding. Probable bidders:
Halsey,
Stuart & Co. Inc.; The First Boston Corp. and Blyth &

Co.,

Inc.

(jointly);

Equitable

Securities

Corp.; White,
(jointly); Kuhn, Loeb &
Co., Salomon Bros. & Hutzler and Eastman, Dillon, Union
Securities & Co. (jointly); Lehman Brothers and Bear,
Stearns & Co. (jointly). Offering—Expected in May or
Weld & Co. and Shields & Co.

June.
Maine

►

a.'ji

Public

...

•

cor¬

Service

Co.

(4/24)

March 9 it

was announced that the
company plans early
registration of 50,000 shares of additional common stock
(par $7). Proceeds—To reduce outstanding bank loans.
Underwriters—Merrill Lynch, Pierce, Fenner & Smith
Inc., A. G. Becker & Co., Inc., and Kidder, Peabody
& Co., all of New York.
Registration — Planned for
April 1.

Mississippi Power Co.
10

it

announced

(6/25)
that

this company plans to
$5,000,000 of 30-year first mortgage bonds.

was

Proceeds—For construction program. Underwriter—To
be determined by competitive bidding. Probable bid¬
Halsey, Stuart & Co. Inc.; Eastman Dillon, Union
Securities & Co. and Equitable Securities Corp. (joint¬
ly); Merrill Lynch, Pierce, Fenner & Smith; Kidder,
Peabody & Co. and White, Weld & Co. (jointly). Regis¬
tration—Planned for May 29. Bids—Expected to be re¬

ders:

on

June 25.

Norfolk & Western

Ry. (4/2)
to noon (EST) on April 2 in
Philadelphia, Pa., for the purchase from the company
of $7,350,000 series G equipment trust certificates due
semi-annually from Oct. 1, 1959 to April 1, 1974, inclu¬
sive. Probable bidders: Halsey, Stuart & Co.
Inc.; Salo¬
Bids will be

mon

•

reported that the company is planning
100,000 shares of common stock.
Myron A. Lomasney & Co., New York.

offering of about

Underwriter

Power &

was reported that the
company plans to issue
$20,000,000 of first mortgage bonds. Proceeds—

sell

For

ceived

April 28

stock

4-Electronic

City

and

Co.

announced stockholders will

increasing the

Kansas
Dec. 29 it

Issue and sell

reported that the company is also planning
common stock to common

was

Kidder, Peabody & Co. (jointly);-Lehman Brothers
Blyth & Co., Inc. (jointly); Smith, Barney & Co.
Offering—Expected in May.

Dec.

(5/12)

Proceeds

received

up

Bros. & Hutzler.

Northern

Illinois

March 25, Marvin

—

Co.

(6/23)

Chandler, President, announced

com¬

plans issue and sale of $20,000,000 25-year first
mortgage bonds. Proceeds — For capital expenditures.
Underwriter—To be determined by cbmpetitive bidding.
Probable bidders: Halsey, Stuart & Co. Inc.; The First
Boston Corp.; Glore, Forgan & Co.; Blyth & Co. Inc.
Bids—Tentatively planned to be received on June 23.
Registration—Expected at end of May.
pany

•

Northern

States

Power Co.

(Minn.)

March 31 it

was reported that the
company has revised
financing plans, and is considering the offering and
sale of $10,000,000 of new
preferred stock. Proceeds—To

its

be

used

gram.

to repay bank loans and

Underwriter—To

be

for construction pro¬
determined by competitive

bidding: Blyth & Co., Inc. and The First Boston Corp.
(jointly); Lehman Brothers and Riter & Co. (jointly);
Merrill Lynch, Pierce, Fenner &
Smith, Inc.; Harriman
:K

rfufbo*?'

one

To

share

new

repay

bank

20

shares held.

for

construction

each

for

loans

and

Underwriter—To be determined by competi¬
bidding. Probable bidders: Lehman Brothers and

Pittsburgh & Lake Erie RR.

(4/7)

Feb.

23 it was reported the company plans to receive
bids up to noon (EST) on April 7 for the purchase from
it of $2,475,000 of equipment trust certificates. Probable

bidders:

Halsey,

Stuart

&

Co.

Inc.;

Salomon

Bros.

&

Hutzler.

Public Service Electric & Gas Co.

(6/2)
reported that the company plans sale of
$80,000,000 to $40,000,000 debentures. Underwriter—To
be determined by competitive bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; The First Boston Corp.; Kuhn
Loeb & Co. and Lehman Brothers (jointly); Morgan
Jan. 30 it

was

Stanley & Co. and Drexel & Co. (jointly). Bids—Ten¬
tatively expected to be received on June 2. /
Southern Electric Generating Co. (5/28)
was announced that the company plans to issue
and sell $25,000,000 of 30-year first mortgage bonds.

Proceeds—For

construction

program.
Underwriter—To
by competitive bidding. Probable bid¬
ders: Halsey, Stuart & Go. Inc.; Eastman
Dillon, Union
Securities & Co. and EqnjJable Securities Corp. (jointly);
Merrill Lynch, Pierce, Fdnner & Smith; Kidder, Peabody
& Co. and White, Weld & Co. (jointly)i Registration—
Planned for April 17. Bids—Expected to be received on
May 28.

be

determined

Southern

March 17 it
issue

and

Nevada
was

Power

announced

Co.

(5/11)

that the company plans

to

sell

$5,500,000
of first mortgage bonds.
Proceeds—Together with other funds, will be used to
repay temporary bank loans, and to refund the slightly
less than $4,000,000 of series "C" 5y2% mortgage bonds
due 1986. Underwriter—To be determined by
competi¬
tive bidding.
Probable bidders: Halsey, Stuart & Co.
Inc., Hornblower & Weeks and William R. Staats & Co.
(jointly); White, Weld & Co.; Merrill Lynch, Pierce,
Fenner

&

Smith

Inc.

Bids—Expected to be received
on or about May 11 in the offices of
O'Melveny & Myers, Room 900, 433 South Spring, Street,
Los Angeles 13, Calif.
9

up to

(PST)

a.m.

Southern

March 17 it

Nevada

was

Power Co.

(4/28)

announced that the company

plans early

registration of $1,500,000 of preferred stock. Proceeds—
To repay temporary bank loans.
Underwriters—May be
Hornblower & Weeks, New York; William R. Staats &

Co., Los Angeles,

Calif.; and

First

California Co., San

Francisco, Calif.
Southwestern
fan.

it

26

was

Electric

reported

Power

that

this

Co.

(5/12)

company

(formerly

Southwestern Gas & Electric Co.) plans the issuance and
sale of about $16,000,000 of first mortgage bonds. Under¬
writer—To be determined by competitive

bidding. Prob¬
Halsey, Stuart & Co. Inc.; Merrill Lynch,
Pierce, Fenner & Smith Inc. and Eastman Dillon, Union
Securities & Co. (jointly); Equitable Securities Corp.;
Lehman Brothers; Kuhn, Loeb & Co.; Blyth & Co. Inc.
Bids—Expected to be received up to 11:30 a.m. (EDT)
able bidders:

on

May 12.
Union

Bank, Los Angeles, Calif.
this bank offered 70,028 additional shares of
capital stock: (par $10) to its stockholders of record
March 18, 1959, on the basis of one new share for each
12 shares then held; rights to expire on April 8. Price
—$59.50 per share. Proceeds—to increase capital and
surplus. Underwriters—Blyth & Co., Inc., and Stern,
Frank, Meyer & Fox, both of Los Angeles, Calif.
March

19

Union Electric Co.

(Mo.)
McAfee, President, stated that the com¬
pany plans to sell about $30,000,000 of additional com¬
mon
stock later this year through rights to common
stockholders. Proceeds—For expansion program. Under¬
writer—May be determined by competitive bidding.
Probable bidders: Lehman Brothers; White, Weld &
Co.,
and Shields & Co. (jointly); Merrill Lynch,
Piferce, Fen¬
ner &
Smith, Inc. Offering—Expected toward \the end
of the second or third quarter of 1959.
Feb. 23, J. W.

Virginia Electric & Power Co.

(6/2)

that the company plans to
710,000 shares of common stock to
be offered for subscription by stockholders of record on
or about June 2, 1959, on the basis of one new share for
Feb.

offer

Gas

(Minn.)

(jointly); The First Boston Corp., Blyth &
Co., Inc. and Kuhn, Loeb & Co. (jointly); White, Weld.
& Co. and Glore, Forgan & Co.
(jointly); Merrill Lynch,
Pierce, Fenner & Smith Inc. Offering—Expected some¬
time during August.
:

and

a.m.

Offering of 76,494 shares of

each

and

•

May 19.

on

Co.
(5/19)
reported that the company plans the sale
of 20,000 shares of preferred stock
(par $100).
Pro¬
ceeds—For construction program.
Underwriter—To be
determined by competitive bidding.
Probable bidders;
Feb. 9 it

by competitive
bidding, probable bidders
Merrill Lynch, Pierce, Fenner & Smith Inc.,

be

may

Eastman

Boston

reported that the company is planning
$4,000,000 preferred stock. Un¬

was

derwriter—Kidder, Peabody & Co., New York, handled
last equity financing through negotiated sale.
If de¬

plans to issue

Dillon, Union Securities & Co.; The
Corp.; Morgan Stanley & Co.; Stone &
Webster Securities Corp.
Offering — Expected about
mid-year.
First

it

the issuance and sale of

and sell $25,000,000 of new preferred stock. Underwriter
—To be determined by competitive bidding.
Probable

bidders:

was

Interstate Power Co.
March 2

Power Co.

March 9 it

it

Issue and sell

5V2% convertible subordinated
debentures due 1971, to be offered for subscription by
common stockholders of record about April 28, 1959, on
the basis of $20 principal amount of debentures lor each
eix shares of stock held; rights to expire on May 13.
Underwriter—Blair & Co., Inc., New York. Registration
—Expected on April 3.
and

2

Power Co.

Dec. 10 it

Interstate Power Co.
March

^ Di-Noc Chemical Arts, Inc. (4/28)
was

Co.
reported

Power

31 it was
that the company plans an
offering of about 150,000 shares of common stock (par
$10). Proceeds—For construction program. Underwriters
—May be Bly th & Co. Inc., Lazard Freres & Co., Kidder,
Peabody & Co. and Merrill Lynch, Pierce, Fenner &
Smith, Inc., all of New York.

$20,000,000

it

that the company plans to
$15,000,000 of first mortgage bonds. Under¬
be determined by competitive bidding.

March

announced that,

in addition to the proposed stock offering to stockholders,
the company plans this year to issue and sell publicly

March 31

(5/13)

reported

was

To

—

^ Idaho

Consolidated Natural Gas Co.

v

it

Pierce, Fenner & Smith, Inc.; Equitable Securities
Corp.; Kidder, Peabody & Co. and White, Weld & Co.
(jointly). Bids—Expected to be received up to 11 a.m.
(EDT) on May 13.

about June 10. PriccA-To be below the
market price prevailing at the time of the offering.
Proceeds — For construction program. Underwriter—
ex)4re

Power Co.

Probable bidders: Halsey, Stuart/& Co. Inc.; Blyth &
Co., Inc., Lazarcl Freres & Co. and The First Boston
Corp. (jointly); Salomon Bros. & Hutzler and Eastman
Dillon, Union Securities & Co. (jointly); Merrill Lynch,

621,256 additional shares of capital stock on the basis

the basis of

on

Riter & Co.

16

States

was reported that the company also is considerihg offering about 714,000 additional shares of
common stock for
subscription by common stockholders

program.

Idaho

(5/21)

Northern

tive

issue and sell

stock¬
about May 21 the right to subscribe for

or

on

-

•

and sell

March

March 18 the directors approved a plan to offer
holders

(9/10)

announced that the company plans to issue

was

Thursday, April 2, 1959

Marpjt) 31 it

ceeds—For

writer

Consolidated

Peabody & Co. and Merrill Lynch,
Smith Inc.
Offering—Expected in

.

.

Ripley & Co. Inc., and Eastman Dillon, Union Securities
&Co. (jointly); Kuhn, Loeb & Co.; Smith, Barney & Co..

determined

Morgan

Bids—Expected
May 26,

Stanley & Co.; The Fifst Boston Corp.
to be received up to 11 a.m. (EDT) on

Under¬

$18,000,000 of 30-year first mortgage bonds. Pro¬
construction program.
Underwriter—To be
by competitive bidding. Probable bidders
Halsey, Stuart & Co. Inc.; Blyth & Co., Inc., Kidder, Pea(body & Co. and Shields & Co. (jointly); Lehman Broth¬
ers;
The First Boston Corp.; Morgan Stanley & Co.;
Equitable Securities Corp. and Eastman Dillon, Union
Securities & Co. (jointly); Harriman Ripley & Co. Inc.
Registration—Planned for Aug. 14.
Bids—Expected to
be received on Sept. 10.

v

was

&

Georgia Power Co.
Dec. 10 it

Underwriter—Union Securities Co. (now Easttnan Dillon, Union Securities & Co.) handled previous
equity financing. Registration—Expected the latter part

March 9 it

Fenner

12 shares

June.

program.

—

Proceeds—For construction expenditures.

Pierce,

$10 038,700 convertible debentures due 1974, to be offered
to common stockholders of record on or about May 12
on the basis of SI00 principal amount of debentures for
each 22 of common held.
Proceeds — For construction

of April.

on

held.

writers— Kidder,

company

Commerce

the basis of one new share for each

stock

.

21

an

it

was

announced

additional

each 20 shares then held.

Proceeds

—

For construction

Underwriter—To be determined by competi¬
bidding. Probable bidders: Merrill Lynch, Pierce,
Fenner & Smith, Inc.; Stone & Webster Securities Corp.
Bids—Expected to be received on June 2.
program.

tive

West Penn Power Co.
March 10 it

(5/25)

reported the company contemplates the
issue and sale of about $14,000,000 of first mortgage
bonds, Underwriter—To be determined by competitive
bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
was

Lehman Brothers and Eastman

Dillon, Union Securities
(jointly); The First Boston Corp. and Harriman
Ripley & Co. Inc. (jointly); Kidder, Peabody & Co. and
White, Weld & Co. (jointly). Bids—Expected to be re¬
ceived up to noon (EST) on May 25 at office of West
Penn Electric Co., 50 Broad St., New York, N. Y.
&

Co.

\

in.

"v

Number 5834

Volume-189

.

.

The Commercial and Financial Chronicle

.

The

Indications of Current

week
Latest

AMERICAN

Equivalent to—
steel ingots and castings

-

(net tons)-—

Aprils

month available.

month ended

48.6

2,556,000

January:
Total gas sales (M therms)
Natural gas sales (M therms)
Manufactured gas sales (M therms)

and condensate output—daily average

1,312,000

42

gallons each)__
to stills—daily average

Crude runs

Gasoline

output

(bbls.)—

Kerosene

output

(bbls.)

Distillate fuel oil output

-

(bbls. of

Residual fuel oil output

—Mar. 20
l
Mar. 20

(bbls.)

Mar. 20

(bbls.)
(bbls.)—.—

Kerosene

-

(bbls.) at——;—-—.—

Distillate fuel oil (bbls.)

-

,

—I

8,283,000

8,052,000

*28,432,000

27,963,000

2,315,000
14,189,000
7,334,000

15,584,000
7,162,000

28,592,000
1,902,000

14,507,000

Mar. 20

7,239,000

212,139,000

Mar. 20

18,333,000

;—Mar. 20
—Mar. 20

77,194,000

55,082,000

—Mar. 21

603,178

204,987,000
19,648,000
84.021,000
55,530,000

/

Revenue freight received from connections (no. of cars)—Mar. 21

;

CIVIL

CONSTRUCTION

ENGINEERING

216,907,000
17,178,000
78,449,000
55,013,000

'

569,071

Mixed gas

595,302

583,181

564,102

555,120

532,997
515,046

$285,660,000
176,172,000

$441,190,000
196,086,000

109,488,000
85,211,000

245,104,000

sales

Orders for

Year

Month

Month

Ago

10,016,900

_

freight
Backlog of
(end

9,658,500

29,300
329,100

cars—

delivered

cars
cars

:

—

Public construction-—_i
-State and municipal
.

COAL

Federal

Mar. 26

$355,400,000

$393,700,000

Mar. 26

179,900,000
175,500,000

225,300,000
168,400,000

Mar. 2G
Mar. 26

;

———Mar. 26

._**.

—

135,000,000
40,500,000

129,400,000
39,000,000

24,237,000

and

Intercity general freight transported by
carriers (in tons)—

4,007

287

1,940

5,316

28;789

29,470

43,750

5,371,121

5,231,965

4,808,961

$3,475
2,500
1,369
1,070

$3,674
2,618
1,448
1,150

$3,106
2,270

245

243

219

382

LABOR—Month of February (in millions):
Total new construction—
Private construction
Residential buildings (nonfarm)_
New dwelling units

.

Additions and alterations*:

Nonhousekeeping
Nonresidential buildings

—Mar.2i

7,695,000

7,625,000

8,055,000

—Mar, 21

386,000

374,000

390,000

7,596,000
328,000

DEPARTMENT STORE SALES INDEX—FEDERAL RESERVE
SYSTEM—1947-49 AVERAGE— 100
Mar. 21

137

124

109

117

Mar. 28

12,709,000

h,900,000

12,972,000

11,645,000

Mar. 26

297

292

296

Electric-output (in 000 kwh.)——

INDUSTRIAL)

FAILURES ^COMMERCIAL AND

—

*

DUN &

BRADSTBEET, INC

,

;

-

V

Mar. -24

6.196c

Pig-iron (per gross ton)—
Scrap steel C per gross ton)—

Mar. 24
Mar. 24

$66.41

$66.41

$40.50

$40.83

(E.

Export refinery at—
York) at
—
Lead 4St. Louis) at_
I Zinc (delivered) at—
——
Zinc XEast St. Louis) at
Aluminum /primary pig. 99.5% )
Straits tin (New York) at-

31.300c

29.300c

21.825c

11.500c

11.000c

13.000c

Mar. 25
Mar. 25
-Mar. 25
-Mar. 25

11.300c

DAILY AVERAGES:
--—

corporate—_

Railroad Group.
Public Utilities Group-

Percentage, of activity

period-

Unfilled orders (tons) afc«end of

85.40

8G.63

95.63

90.06

90.06

90.20

95.47

.93.82

93.97

94.41

101.80

Mar. 31

92.20

92.35

92.93

99.52

.Mar. 31

90.06

90.06

90.34

95.47

84.55

84.43

83.79

86.24

88.54

88.54

89.09

91.34

.Mar. 31

89.78

89.78

89.78

97.16

Mar. 31

91.77

92.06

91.77

98.25

3.92

3.89

3,76

2.87

.Mar. 31

4.41

4.41

4.40

4.04

.Mar. 31

4.15

4.14

4.11

3.64

.Mar. 31

4.26

4.25

4.21

3.78

.Mar. 31

4.41

4.41

4.39

4.04

.Mar. 31

4.82

.Mar. 31

4.52

.Mar. 31

4.43

Mar. 31

4.29

Mar. 31

390.6

4.83

4.88

4.69

4.52

4.48

4.32

4.43

4.43

3.93

;

4.27

4.29

3.86

388.8

-383.2

395.6

279,776

305,979

306,218

307,440

297,549
304,774

273,800

94

93

94

88

.Mar. 21

444,024
110.76

.Mar. 27

470,191

239,605

400,485

110.58

_

3,242,110

2,312,580

628,060

467,780

2,584,620
3,212,680

1,990,660
2,458,440

—Mar.

555,610
44,900

450,620

—Mar.

—Mar.

492,050

413,720

purchases

109.88

2,230,050
347,000
1,961,170
2,308,170

1,338,670
250,750
1,028,180
1,278,930

—

■—

Mar.

536,950

479,420

V 894,279

924,700

•587,170
128,670
690,355

—

account of members-—
—

819,065
3,350,370

—Mar.

4

—Mar.

4

135,130

—Mar.

4

;,

Mar.

4

■—Mar.

4

1,059,830
4,691,999

Mar.
Mar.
Mar.

4
4
4

808,090

662,150

4,001,370
4,809,460

3,094,775
3,756,925

—•

Other sales

sales

STOCK TRANSACTIONS FOR ODD-LOT ACCOUNT OF

729,705
'

»

,

111,420
793,972

456,204
131,100
570,596

Odd-lot

sales hy dealers
Number of shares

2,131,134

416,850
1,898,136
2.314,986

ODD-

•

—

.

.

Round-lot sales by dealers—
Number of shares—Total sales
-•

-

Other sales

4

2,313,987
$118,922,621

1,855,697
$97,385,106

4

2,117,527

1,643,766

Mai'.

4

Mar.
Mar.

Mar.
Mar.

4
4

9,755
2,107,772

11,127
1,632,639

Mar.

4

$108,954,498

$84,969,399

1,786,795

1,117,796

$87,528,880

$50,083,429

1,549,251
7,604

920,451
15,145
905,306
$39,627,658

1,541,647

$76,215,124

562,140

429,040

410,740

235,870

Mar.

4

=—Mar.

4

562"l40

4~2~9~<SJ

4lb"740

235~870

Mar.

4

784,900

627,700

640,390

472,980

—Mar.

4

—

SECURITIES

Total

round-lot

Short

sales

Other

sales

EXCHANGE

Total sales

STOCK
COMMISSION

,

—

—

—Mar.
Mar.
Mar.

4

903,300

831,480

640,590

736,690

4

20,969,810

16,482,230

16,807,450

10,232,890
10,969,580

4

21,873,110

17,373,710

17,448,040

Meats

foods

—

.

jl

.

119.3

119.4

Mar. 24

90.3

*90.8

89.9

100.4

Mar. 24

107.0

107.2

107.2

110.7

Mar. 24

93.6

99.0

98.2

106.8

Mar. 24

127.8

127.8

127.5

125.9

_Mar. 24

—

products.

Processed

All commodities other than farm

and foods—

—

119.1

•

119.8

^Revised figure.
^Includes 317,000 barrels of foreign crude runs. SBased on new annual capacity of 147,633,670 tons
as of Jan.
1, 1959, as against Jan. 1, 1958 basis of 140,742,570 tons. tNumber of orders not reported since introduction of
Monthly Investment Plan. $ Prime Western Zinc sold on delivered basis at centers where freight from East St. Louis exceeds

one-half

cent

a

pound.




—

service

liabilities

*

Total liabilities

COAL EXPORTS

...

1,056

836

92

91

56

322

356

312

27

28

28

197

223

29

30

201
24

42

30

30

33

29

98

105

73

265

285

220

96

105

91

66

54

39

37

28

21

207

215

208

104

132

112

582

642

662

164

188

177

104

96

79

1,161
$17,444,000
7,363,000
22,327,000
6,911,000
4,547,000

1,273
$17,062,000

1.238

$58,592,000

$73,564,000

$65,295,000

180,942

192,485
155,248

225,193

*37,237

126,426

8,472,000
33,197,000
8,274,000
6,559,000

$24,331,000
5,870,000
23,038,000

8,747,000

3,309,000

(BUREAU OF MINES)—

Month of January:
U.

S.

exports
(net tons)

:

To Europe

Pennsylvania

of

'

*.

anthracite
.

Central America

and

(net tons)

(net tons)

162,532
17,970

92,434

5,495

...

America

(net

tons)

18
820

440

■**

COPPER INSTITUTE—For month of February:
Copper production in U. S. A.—
Crude (tons of 2,000 pounds)
;
Refined (tons of 2,000 pounds)

_

In

IT. S.

A.

(tons of 2,000 pounds).:

Refined copper stocks at end of period
of 2,000 pounds)

ERNORS
.

OF

TnE

FEDERAL

93,029
128,299

142,235

*106,826
137,361

120,134

114,425

93,784

85,523

80,780

201,223

244

143

130

145

142

131

63.0

62.3

66.8

579,415

644,810

479,097
100,158

546,320
98,315

160

175

466,141
392,472
73,359
310

101,895

(tons

RESERVE

SYSTEM—1947-49--.100—Month
Seasonally adjusted
Unadjusted ;

of

Feb.:

——

INTERSTATE
Index

COMMERCE COMMISSION—

of

Railway Employment at middle of
February
(1947-49 = 100)
*
VEHICLE

MOTOR

IN U.

number

Number

FACTORY

SALES

FROM

S.—AUTOMOBILE MANU¬

ASSN.—Month

of

of February:

vehicles

of

passenger cars
of motor trucks

Number of motor coaches
PORTLAND CEMENT (BUREAU OF MINES)—
Month of January:
Production
(barrels)
®
Shipments from mills (barrels)
Stocks (at end of month—barrels)

Capacity used

14,322,000

16,623,000

18,230,000
13,593,000

34,798,000

"30,762,000

33,235,000

55

70

59

7,739,376

7,264,236
6,740,163
19,298,504

18,486,000
—

(per cent)..—

RUBBER MANUFACTURERS

23,590,000

ASSOCIATION,

Passenger Tires (Number of)—
—

and^us

Production

3,715,742
8,858,782

17,997,577

8,046,197
*17,817,687

Tires (Number of)—

•—*

1,090,063

1,152,767

1,324,927

1,329,978
3,170,719

3,401,446

Implement Tires

^Number

1,007,180
1,073,926

3,470,460

of)—
—

Production

Commodity Group—
Farm

liabilities

Shipments

100):

AU commodities

i

Construction liabilities

Tractor
U. S. DEPT, OF

WHOLESALE PRICES, NEW SERIES
—

11

975

71:

7

*

liabilities

liabilities

Commercial

Truck
^

-

-

14

56

......

'

(SHARES):

sales—

LABOR—(1947-49

12

280

71

...

—

Manufacturers'

21

68

307

15

*

Total number

23

64
296

2!

*

Shipments

STOCK SALES ON THE N. Y.

tPE ACCOUNT OF MEMBERS

372

INC.—Month of January:

Number of shares

EXCHANGE

398

BRADSTREET,

—

Commercial service number

Wholesale

380

—

number

FACTURERS'

Ropnd-lot purchases by dealers—

TOTAL ROUND-LOT

Construction

Retail

14
104

development

Wholesale number
Retail number

.

16

98

■

INC.—Month of February:
Manufacturing number

PLANTS

Customers' short sales
Customers' other sales

enterprises—*
and

public

BUSINESS FAILURES—DUN &

Number

.

■

Dollar value

All other

Total

(customers' purchases)—T

Dollar value

sales

701,696

ON N. Y. STOCK
EXCHANGE COMMISSION

Odd-lot purchases by dealers (customers' sales)—
Number of orders—Customers' total sales

-Short

905,392
3,461,585
514,820
3,185,832
3,700,652

SPECIALISTS

AND

EXCHANGE—SECUURITIES

service

Conservation

25

14

101

60
'

35

50

INDUSTRIAL PRODUCTION—BOARD OF GOV¬

the floor-

—

LOT- DEALERS

Public

336,260
35,000
299,360
334,360

501,130
56,400
430,690
487,090

65,700

sales

Total

systems

,

64

42
•

Deliveries to fabricators—

Short sales

Tdtal purchases
Short sales

and water

Water

the floor-

Total< round-lot transactions for

Highways

859,226

114.72

;

Sewer

.

195

73

39

.

buildings

„

*

*

219

70

_

Other sales

Total

"

•

To South

.Mar.

Total sales.

nonresidential

Undesignated

^

on

Total purchases
Short sales

Other

Military facilities

*

To Asia (net tons)

Mar.
Mar.

sales

initiated

•

Mar. 21

:

Other -transactions Initiated off

..

1

.Mar. 21

—-—

Other transactions

-

,

.Mar. 21

sales

Other sales

-

Mar. 31

DEALERS AND SPECIALISTS
stocks in which registered

purchases—

Other sales

Hospital and institutional
Administrative and service

ACCOl^T OF MEM¬

FOR

TRANSACTIONS

BERS, EXCEPT ODD-LOT

.

85.63

.Mar. 31

f

*

■

Mar. 31

Transactions of specialists in

Total

93.625c

—

„

Educational

To North

PRICE INDEX-

OIL, PAINT AND DRUG REPORTER
IMS AVERAGE = 190—
—

Total

104.750c

construction

Industrial

^

Production-* tons)—————---—

•

103.375c

97

209

20

—

Residential buildings
Nonresidential buildings

>.

ASSOCIATION:
1—

Orders-received (tons).

-Short

10.000c

26.000c

utilities

■

10.500c

11.000c
24.700c

Mar. 31

INDEX—

NATIONAL PAPEBBOABD

Total

11.500c

11.000c
24.700c

——-—.——-—

MOODY'S COMMODITY

ROUND-LOT

11.500c

11.000c

258
.161

153

.

115

34

Telephone and telegraph
Other public utilities
All other private

12.800c

24.700c
102.250c

.Mar. 31

—-—.—•

10.800c

Mar. 31

;*—

Aa

»

11.500c

Mar. 25

Industrials Group

U.S. Government Bonds

11.300c

268

148
114

47

Sewer

Railroad Group
^
Public Utilities Group.

MOODY'S BOND YIELD

24.225c

30.150c

—

1

29.675c

11.500c

■

*

31.350c

Mar. 25

AVERAGES:

Average corporate—,

31.200c

252

48

Public

Mar. 25
—Mar. 25

at—

MOODY'S BOND PRICES DAILY
U. S. Government Bonds—

Industrials Group

$35.00

.

~

Lead (New

Average
Aaa

5.967c

$66.49

$43.17

M. J. QUOTATIONS):

&

Electrolytic copper—
Domestic refinery at--

Aaa

6.196c

366.41

■

173

44

Railroad

-

6.196c

705

167

47

—*

49

660

Hospitals and institutional
Social and recreational

Farm construction

327

810

638

262
.

1,078

55-

Educational

Public

COMPOSITE PRICES:
Finished HBteel (per lb.)
—

PRICES

"I

—

Miscellaneous

'

IRON AGE

METAL

—

Office buildings and warehouses—_
Stores, restaurants, and garages*—
Other nonresidential buildings—.
Religious

INSTITUTE:

EDISON ELECTRIC

54

Industrial

.

Commercial

OJUTPUT (U. S. BUREAU OF MINES):
(tons)

25,300

290,200

BUILDING CONSTRUCTION—U. S. DEPT. OF

190,240,000
54,864,000

Pennsylvania anthracite (tons)

8,483,300

undelivered

of month)—

———

Bituminous coal and lignite
»

8,798,800

1,806
2,486

:

order

on

——

Total'tJ. 8. construction—
Private construction-———

8,709,000
8,423,900
21,300
263,800

AMERICAN TRUCKING ASSOCIATION, INC.—

NEWS-RECORD:
■;

of that elate:]

Previous

(M therms)

freight

new

New

ENGINEERING

—

are as

Latest

AMERICAN RAILWAY CAR INSTITUTE—
Month of February:

7,197,000

"

freight loaded (number of cars)—.——

"

„

6,262,885
7,316,000
24,997,000
2,352,000
11,587,000

2,784,000

210,290,000
18,988,000
78,876,600
55,010,000

RAILROADS:

ASSOCIATION OF -AMERICAN
> Revenue

7,208,320

Mar. 20

—

at—
Residual fuel oil (bbls.) at——

*7,154,520

—Mar. 20

Stocks at refineries, bulk terminals, in transit, in pipe lines—
Finished and unfinished gasoline (bbls.) at™—
Mar. 20
,

7,202,870
fi8,082,000

_

either for |Im|

are

AMERICAN GAS ASSOCIATION—For month of

AMERICAN PETROLEUM INSTITUTE:
Crude oil

of quotations,

cases

Ago

90.3

*2,631,000

that date, or, in

on

45

production and other figures for tbi

cover

Dates shown in first column

Year

Ago

*92.9

§2,653,000

or

Month

Week

§93.7

Aprils

u——;

or

Previous

Week

;

following statistical tabulations

latest week

Business'Activity
IRON AND STEEL INSTITUTE:
Indicated Steel operations (per cent capacity)

(1565)

*

Inventory
Passenger Motorcycle, Truck and Bus Inner
Tubes (Number of)—?

343,906
377,026

257,666
351,785

953,677

*921,895

341,838
275,693
785,287

4,308,703-

Shipments

4,800,057

Production

3,805,739

3,490,958

7,536,100

*8,616,988

3,343,650
6,699,558

38,224,000

45,200,000

34,670,000

42,232,000

43,638,000

34,608,000

31,652,000

27,550,000

24,252,000

Inventory
Tread Rubber (Camelback)—
Shipments
Production

(pounds)
(pounds)

Inventory (pounds)

*

*

—

3,410,974
„

f

/

The Commercial and Financial Chronicle
46

Lime

Gypsum,

Milwaukee,
investment banking

Co.

&

headed

an

By ROBERT R. RICH

which on March 31 pub¬
licly
offered
50,000
shares of
McQuay, Inc. common stock (par
$1) at $11.50 per

proceeds to

net

The

FIF

share.

Fund Shares

Record 12 Months

the com¬

to

Assets Gain

use

assets

manufacturing

The balance of such

be added to the

space.

proceeds will

company's general

working capital.

(Special to The Financial Chronicle)

CLEVELAND, Ohio — Stanley
W. Grossman is with Bache & Co.,

Sixth Building.

National City East

Two With Murch & Co.
^ '

(Special to THE Financial Chronicle)

Belgium Exclis.

Hanna

Exchange.

ESTABLISHED

A mutual fund

list

selected

a

|

for

|

.

T

financial

mutual

Denver

in

•

+

a

i

it

industrial

investment
and

a

located
24th

ns

in

now

a

* una,

fund

its investment

Gas Transmission Co.

of

|

investments

j

ies in 22

Incorporated

J

list

investing in

|

a

J

of securities for current

I
'

income.

j
A prospectus on

each

fund is available from
your

investment dealer.

The Parker Corporation
200

i
i

28,

in

Monsanto

Chemical Co.

Investment
i

to
last

12

«

over

income
,

FIF

income

shareholders
months

M

have

dividends
^

cuviaenas

the

during

amounted

■'it

tO
±

+

$2 million, an amount great-

i

|-

The four

holdings were
(12.41%), Utilities
(11.32%), Oils (9.33%), and Electronics (8.70%).
industry

m

anF preceding

12-month period.

I

Berkeley Street

I

Boston, Mass.

New

Jersey Fund

total

the

j

^

T

•

j

mutual fund investing in the se-

business

cor-

p0rations, achieved all-time highs
in Per share value and total net

„ec*a

quarter of its present fiscal

year.

William F. Shelley, President of
the

large U. S.-sponsored mutual
fund, told shareholders that:
Net

to

value

asset

increased

more

$15.03 from $10.78

and

the

of

fund's

than

39%

year

ago,

$14.03 at the end of the

pre¬

a

vious quarter on Nov. 30.
Total

net assets

rose

sharply to

$98,933,788 from $70,195,430 at the
end of the corresponding period a
year .ago.
This represents an inof

crease

41%.

Three

fund

earlier, the
$91,060,283.

had

investment

Net

months

income

the

for

w

reinvestment

rather

than

dis-

in

the

{ribXTto^ sharehXs

form of taxable dividends.

^anadian business recovery,
The Canadian
the fund's quarterly report noted,
nrmtinnsU af
hMUhv nano
"TVio
a

continues at
jn(jex

a

industrial

0f

estimated

to

about

in

forefront of

recovery

200,000 shares of $1 149 from 124 at the same time last
capital stock of New year other business indices show
Jersey Investing Fund, Inc. are a
continuation
of
the
onward
currently being offered by Spear, trend in the flrst quarter.
Leeds & Kellogg, New York, in,
.
uu
i
vestment adviser, distributor and
broker for the fund. The stock,
!
t
—'"J
flect the business and earnings
priced at $10 per share, is being
-

describes THE

'

J

C0MM0H STOCK

of

CR0IIP

SKIHOTKS,

investing for in¬
and pos¬

INC.

/

sible growth

k

through

r

mon

com¬

•

/ ?—

stocks

selected for
ment

]M

fm

1

their invest¬

quality.

MM|

Mail this

advertisement.

She*, NowYoifc 5,M.Y. CFC




Works

phmosLamps- Wqiks,

•

Schering Corporation, Texas Natural

Gasoline

Company.

in

It

Corp. and Upjohn
increased holdings

other companies. Iiv. t e
period the fund eliminated

13

same

to

Htoh

VoRupp

KnPi-

neering and McGraw-Edison and
its

reduced

gheny

investment .in

Ludlum

Steel

and

t

have

nevertheless

,

February of this year,
Changes in portfolio for the last

capitalization of the

Massey-Ferguson Ltd.;

common

made

Bailey

Co.

and

Increases

in

incorporation has been
changed to Massachusetts from
Delaware, as previously approved
by shareholders.
The change/ is
expected to result in annual sav¬
ings in operating expenses and
does not affect the objectives or

consists
consists

shares

the report states,
' '

on

a

continuous basis

(Special to The Financial" Chronicle)

Corp., Imperial In¬
Corp.."A"; Interprovin-

Canada

,

or

the

considerable^hea . iness

rule. But the uncertainty over the
basic outlook is stfcpng enough to

make investors keep an eye glued
equities to the detriment of
fixed term obligations.

on

And

emt¬

growing

the

from

pouring of stock capital operations
it

corporations ore
turn to equities f>r

that

appears

to

to

enough

in¬

assure

interest.

vestor

This goes for the utilities

which

have been the prime borrowers in
the money market over
a
long

period. By raising capital through
the
sale
of
equities they
are
naturally able to improve their
stock to debt ratios.
Made to Order

"Performorama"

A

a

Fer10Jm°ra™a

i

industrial issue is

a

bit of

a

rarity these days, so much so that
when a good name comes along
interest

high. That was re¬
in the instance
Ste^l Corp.'s $75 million
25-year, 4.35% sinking fund
runs

portedly the

case

of Armco

For Dealer Use

of

debentures.

new
new

™

Dealers

reported

a

brisk de¬
offering

PO^et-sized
handbook setting
forth performance figures for a

mand for

wide

when it came to market priced at

variety of assumed investments in each of the Broj
Broad Street
Group of Mutual Funds- -is now
o^Uol-,lQ

this particular

to return 4.35% yield

100

Proceeds

buyer.

to the

designed

are

to

in->rnefmnnt

to

investment

tion arid Whitehall Fund, Inc.

ac-

cording Ao Milton Fox-Martin,
President of Broad Street Sales.
The

20-page,

Presents concise

handy

booklet

illustrations

Debt Offerings
Next

Stow

week's roster of .debt

I
of¬

ferings is light, the largest being
Natural
Gas Pipe Line
Co. of
America's $20 million of bonds,
slated for marketing on Thursday.
On Wednesday, Hawaiian Electric

million bonds on
while W. T. Grant will be
offering 320,000 shares of common

Co. Ltd., has $19

of

tap,

'.assumed ■ lump sum investments of

$10,000 in each of the mutual

funds in the Broad Street Group stock.

.
,
The week's biggest undertaking

for 10-year, 15-year, 20-year and

25~year

periods

with

dividends

ts

and distributions from gain taken
cash-^-with dividends taken in

Gas

Tennessee

---Co.'s
$40

jn

million

«tbek, due out

on

Transmission
of

preferred

Tuesday.

cash and distributions from gainc
Southern Union Gas Co., rounds
taken in shares—and with divi- cut the week with a scheduled

flends reinvested and distributions

stock'on Fridav'068'^ ^r^erre<*

from gain taken in shares.

Ford Secondary
.

riods

in

BrOad

Street

secondary
offering
of
2,000,000 shares of Ford Motor Co.
common

.

(Special to The Financial Chronicle)

market place looked with
- than
lnterest -on the

current

Investing,

Copley Adds to Staff

1 The

usu^

Plan investments for various pe-

for

the

account

of

The

Ford

Foundation. The latter sold

10.2

million

shares

initially

in

-

January, 1956, at $64.50 a .share to
set a record for secondary stock

..

-operations.
\
^
COLORADO, SPRINGS, Colo.John
E.
Wengrovias has
been
The current offering, priced at
added to the staff of CoDley and $56.50 a share, was oversubscribed.
Company, Independence Building.
~
n'
_

cial Pipe Line Co.; Quebec Natural
Gas Corp., Quebec
Power
Co.,
Texaco

with

An

period were National Investors and Whitehall
Selburn Oil & Fund.

?af
& Chemical Co., Ltd.; Great
Lakes Power
vestment

out¬

C

stability continues
to be the question at the moment.
And just now even the stock
market is a bit strained looking

.

"Performorama"

of

offered

promise at the

character of the fund in any way,

2
nfZ.
a k of Nova

.Antir^iv
nf
son nnn
^as»
»
Scotia,
entirely of
500,000
Calgary & Edmonton Corp.; Ca¬
capital-stock, $1 par
nadian Bank of Commerce; Ca¬
value.
nadian Industries Ltd.; Canadian
It is expected that shares of
Ltd.; .Dominion
New Jersey Investing Fund will Oil, Companies,

nd
fund

Inflation

of

for this same

in

much

set, cooled out.

attractive

The report notes that the fund's

Montreal

Authorized

the Ohio Edison issue, ^wlhich had
shown

willing

Ltd.;

Trust

new

their needs where the situation is

tain the advantages of a

diversi¬
portfolio
and
professional
supervision of their investments.

volume
suffteient
to -clear away
recent
corporate offerings.

But then demand faded and even

Alle¬

Johnson.

state

in

f

Mead

fied

With Bond & Share Co.
.Stal*.

DISTRIBUTORS GROUP/ INC.

'

u

Breweries Ltd.; Eddy Paper Co. results for assumed Accumulation

through the fund's distributors.

Address.

f

iSflS 5™

£

tunity for small investors to ob-

be
Nam.

cay.

Oct. 17, 1958, is an opendiversified
on

•

management^in- three months ended Feb. 28, 1959
The: "Performorama,"
which
vestment
company
Its primary include new additions in Banque contaihs more than 5,000 facts and
purpose is to provide an oppor- Canadienne
Nationale;. Canadian figu-es, also; gives performance
end

A mutual fund
come

in-

,

imProvei^ent
registered a g?^g,ail? ^ri0m an
ave/a8c level of 12l last February

corporated under New York state
laws

FUND

-

.

New Jersey Investing Fund

*

have
increased to Broad Street Sales Corporation,
January from 154.4 national distributor of shares of
in December 1958 and 148.6 a year Broad Street Investing Corporaearlier.
tion, National Investors Corpora156

with
the latest index figure moving to

offered only in the states of New
York and New Jersey.

;"

buyf* athSeStwS

defray cost of additions,* imdealers help
—
production is and their representatives through provements and replacements

.

H

*

In the three months ended Feb.

healthy pace. "The available

„

BOOKLET-PROSPECTUS

and

Street Has

quarter amounted fo approximate¬
ly eight cents per share. In ac¬
cordance with the policy of the
fund, these earnings were retained

in the

of

shareholders

of

ord hi.hs.

assets

value

par

number

holding

^

"New residential construction is

Shares Marketed
A

i

cur|^es of Canadian

140 compan¬

Chemicals

outstanding
totaled
18,473.316,
compared with 14,996,4.69.
Both

Canada General Fund Limited,
a

1959, FIF held

over

.
Shareholders at the quarter end

numbered 69,435, a 25% increase
over the 55,631 a year ago
S'" ares

Ycai"

111 a

f

j

shares

major industrial classifications. Largest individual company holdings were in American
Telephone
and Telegraph
Co.,
Charles Pfizer -& Company, and
largest

A mutual fund

.19% Galll

r

^

.:•••

.

....

.

shares outstanding were also rec¬

Climax,
Inc.,
Corporation,
Kroger

possible long-term growth of

>

Share Value SIiows

Metal

Feb.

r

Canada General

Burroughs
Company, and Parke, Davis & Co.
As

since

change in the

w

the Amster-

on

Exchange

(Holland)

situation in the in¬

course of the past
$241,649,766 a
Jain of 78.%oyer: ^^rii^tua^"rem^^d*pretty
Um $135,672,666 a year earlier mnf.h alooi presumablv .satisfied
Net asset jvalue per share on Feb. . to-watch and wait for^he market
28 was $13.08 which, together with to give a more definite cue to its
a capital gain distribution of 11 near-term trend
.cents per share in December, 1958, :
„
hm
h

4M

The

listed

been

The general

vestment market underwent little
were

on

August, 1951.

During* the 3-month quarterly
period ended Feb. 28, 1959, total
assets increased $16,950,333. This
gain or
gam
of over - «-/»
14% resulted pi...principally from increased values of
the Fund's
investment holdings.

capital and income.

Income Fund

its

;\

Feb. 23

Belgium.

American

investing in

of securities

on

dam

eliminated
during
the quarter as investment hold¬
ings were American Natural Gas,

1925

r :

Total net assets

have

Companies

Investors

history.

in

The

be

to

nessee

Incorporated

per

$135,903,380, another
quarterly record. The correspond¬
ing figure one year ago was $79,245,063.

Smith.

listed

by Pres.
93rd FIF

portfolio during
the
quarter through substantial
purchase of shares in Jones &
Laughlin Steel Company, Philips
Lamp, Southern Company, Stand¬
ard Oil of Indiana, Sunray MidContinent Oil Company, and Ten¬

FREE ON REQUEST

value

asset

quarter end in

assets at the end of the Feb. quar¬

io

EITHER PROSPECTUS

net

any

Quarterly Report shows total net

made

Building, members of the

New York Stock

for

Feb.

on

highest total

on

F.

Charles

.

CLEVELAND, Ohio
Peggy
Joseph P. Lirider are
now
with
Murch
&
Co., Inc.,
S. Kidd and

to

the Brussels Bourse, and totals $1349, cempare&.with $9X1*
the Antwerp Stock Exchange,, on Feb. 28 a year ago, a gam of

announcement

an

ter

With Bache & Co.

reports that

and

share

_

additional

Fund

28 the fund had. the

on

$235,000 of such
Chester D. Tripp, President of
The
$56,658,317
increase
in
net proceeds to pay the expense
Television-Electronics Fund -Inc.,
of constructing an addition to its total net assets of Financial In¬
Inc. during the iirst and largest mutual fund conplant at Faribault, Minn., of ap¬ dustrial Fund,
proximately 40,000 square feet to 12-month period ended Feb. 28, cehtrating its investments in the
the largest increase broad field of electronics, anreplace warehouse space in Fari¬ 1959, was
period in nounced that the shares of this
bault now under short-term leases during any 12-month
fund havp been
to the company and to add some the Fund's history, according to Chicago-based
approximately

arid

Gas

Massachusetts Investors Growth
Stock

$514,885.

pany
are estimated at
The
company
proposes

Aiabastine;

Set New Records

T V- Electronics

Reports

and

Natural

MIGS Continues

Inc.,

group

.

Thursday, April 2, 1959

.

.

Teck-Hughes Gold Mines "Ltd.

Mutual Funds

Offered to Investors
Loewi

Ontario

.North

McQuay Common Sfock
/

.

(1566)

x

Wedbush Adds

to

Staff

With Wagenseller i Durst
.

(Special to The Financial Chronicle)

„-

LOS

ANGELES, Calif-—David
PASADENA, Calif. — Randolph
LOS ANGELES, Calif.—James R- Nielsen is now connected with
R. Myers, Jr., is now with Bond Investments, Ltd. "B.M Eliminated E..
Harris, Jr., has been added Wagenseller & Durst, Inc^ 626
& Share Co.', 16 North Marengo from the common stock portfolio to the sta^ of Wedbush &
Co.,. South Spring Street,* members of
Street.
were
the Pacific Coast Stock Exchange
Eddy Paper Co. Ltd. "A"; Playa del Rey.
Ltd.; - TorontoDominion Bank and United Fuel

•

-

(Special to The Financial Chronicle)
/

.

.

Number 5834

189

Volume

.

.

The Commercial and Financial Chronicle

.

Continued from page 3

(1567)

leading producer of basic indus¬
phemicals. Any price increase
heavy chemicals will natur¬
ally benefit Allied to a relatively
high degree.
In addition, to the
cyclical rebound ; which is now

weeks

share compared
with
full. tives, high energy fuels, etc. These
profits of $3.41;. Diamond developments
wer e
jfrobably
Alkali's fourth quarter earnings started some five-seven years ago,
rate was about
$3.50 per share and just recently have begun to
compared with $2.32 for the full bear fruit.
Assuming continued
year.
Koppers Company's fourth expansion of the research effort,
quarter annualized earnings ap- there is no doubt but that a new
proximated $3.60 per share com- flow^ 'of ■ scientific
achievement
pared " with
reported
recurrent will be forthcoming to make the
.profits of $2.30 per share; Rohm & industry,
evidence
dynamic
Haas $17
versus-$13.05; Union growth in the 1960's.
Carbide $5.50 versus $4.15;
Indi- * r Based on a recent survey, it
cations of first quarter 1959 re-;

be

,

ings materially.

prices

break

On

this volume

,

.

$4.75

not

are

unrealistic

seen

in

these

of
the

„ttVVhave

boron

down

area

*1

share, and I estimate that there
a

to year Improve¬

year

ment in earnings

fin

of this year.

in the first part

The stock now sells

300, but the company is now

over

indicateH

better integrated than ever

that I. think

company

built

has

Film Corp.

&

group

up

a

good

before,

research

in all three areas of interest

still

and, without government control,

auite attractive is General Aniline

could witness still further market

special

a

situation

but

|u e anracuve is General Aniline

com-

earnings, the fourth quarter
profit rate approximated $12

has been

<?iih<?tnnt'iai

nresent

1958
a

a

„

based

the

to

verv

a

from'

One last

is

share earnings of upward of

many

BW11

of

Generai Aniline

.

,

fuel<?

reduction

of busi-

.

price

pound

ner

neighborhood
of
$700
million
compared with last year's $636
million.

year's earnings, subject to year
audit, were around $7.20. On

end

in oneration which will

the

chemical

As

soon

WJlAX

'nlant

pilot

ness,

side.

_

place, progress has been
made in reducing or eliminating
some of the loss areas, such as
nylon, corpolection polyethelene,
etc., which should help 1959 earn-

..

the low

on

probably has
press, Stauffer will

It is not unreasonable to anticipate sales in the

t

several

ago,

you

taking

per

'year

made

of around $6.50 on
present shares outstanding, could

in the

Chemical Industry/Prospects

estimate,

range

trial

47

appreciation over the longer term,
Pared
with $3.41
in 1958, a gain pU&CU
p0SedS'three
onl+c fnrthon nnnfinn
fViir.
nf
oKnut
nivrinrc
UI UUCC divlstons^K-hemicai
U1V1WOI1S
ClieilllCdl
suits
further confirm this
contenindustry^ will probably spend of .about 40%. Giving considerancl
dvestuffs
Ozalid
and
the
EARNINGS STATEMENTS
tion.
Hercules Powder estimates somewhat less for the new
plant tion to the new areas of research A
division' Chemical and dvethal
its
earnings
will
be
56c -this year than the $1.8
billion, es- emphasis, such as plastics, fluor- c+llffc
T«n
against 38c in the like period last timated
by
the
Manufacturing *ne, high energy fuels and syn- f* ,f®s
the
AnsL dTvi^ on
year, a
gam of 47%; Monsanto
Chemists' Association, used last thetic fibers, I calculate that this another <U5 *fift mil
^d
the
Notic« fo Security Holders of Chemical
has
reported prelimi- year. This Association has just re- company s earnings potential in a
*55-*b""J®
nary earnings of about 52p. versus ? leased; its results
of an annual the next few years, using a maxi- ~
?n knover QfW nf thi?
The Cleveland Electric
27c, a gain of 92%; Hooker about construction survey which showed mum efficient rate of presently
%
45c versus 27c; Allied Chemical's
.that'-a'bbut : $1.1'.- billion.- will be installed and scheduled plant, is
Illuminating Company
of
Aliln PrJlLv+v hot
results could equal $1.05-$1.10 a
spent for projects now underway, * the area
of $7.25-$7.50 per f
hiAlS «SS?S'fhli
"share
^versus 68c; du Pont could-This sharp year-to-year decrease' s^are.. Based on the present price * a££?0ufd?be immSt
Earnings Statement for the Twelve
show, earnings in the $2
area, in....c.a p it a 1
expenditures
was
°f 104, the stock is selling 22 ^ck could, bq imminent. Hast
Months Ended February 28,1959
versus $1.51 last year, and Union
ascribed to construction cut-backs tlmes estimated 1959 net earnings week, th® International Court of

wtfljlippeaf

AH O/

.

nnv,n,^nnn

.

nn

AZn

<>'7 /->•

novpnc

Carbide

Allien

;

probably : around

J.I.

-jli-.'Ai.,

i.

-

<-

'

i

and about

^

compared with 76c last year;

"

"of 1957-58.

times

10

1959

cash

Swiss

earnings.

A portion of the cur-

"

turning to the price ^of in- treirit' expenditures will be used for
dividual
chemicals, attention^ is; the * modernization
of
existing
•directed

to

the

fact

that

Atlas Powder Company

the-

equipment-although management
price index of chemir still
recognizes
the
long-term
cafs and allied products has:not. growth?potential of the industry,
recorded any particular gain since
Present; • capacity for practically
; 1951, and, in fact, very little .since
all .chemicals is far from adequate

,

wholesale

1.947.

On the other hand, "metal for i965-70 demand. Based

products, paper, rubber, to
few

a

industries

combined

index

well

as

lo.\ver anticipated

on

the

expansion

new

Mthe 'for;
1959','start up expenses should
commod- "be 'reduced for many of the

all

of

name
as

larger
sharp in- manufacturers. These expenses
though are -nqt- normally released, but
not cbmbanies-iust
many of these industries have nob
completing maior
companies-just completing
major
continually operated at capacity expansion like Allied Chemical,
.during this period; This is, per- American Cyanamid, and Olinhaps, one reason why chemical Mathieson, etc. should witness a
profits have not expanded as rap- sharp .contraction this year,
idly in recent years, as say, 10-20 - • - *

Uties

have

registered

since

creases

1951,

even

<

.

v

I find increasing trade" >

years ago.;

•-talk

to

the

cyclical

effect

that.-^if

-

the

Dramatic Profit. Gain

■

Therefore

defy the
Javvs of supply and demand and
raise
prices
while

I

believe

the

fac-

be^antolinfluence

industries'-: can

op-

^rations favorably during the last

operating*^ at sfx

months of 1958 and the first

less-than capacity rates, then the
.;part of this year should continue,
chemical industry probably could and should
permit rather drac

]^ise.; While there

.

were rriatic year to year profit gains for
^,erris as most companies. More specifically,

Cu^5S-in SUCi

v

phthalic anhyaride, polyethylene,
polypropylene, and styrene earlier
this year, chemical price advances

?n?n
£.e more
1959-60 than

Prevalent

.

cn

experienced

,This would

for certain basic chemicals

have been

t

in

six

months to

various

areas
a

sup-

the last

over

despite the
recession; these

year

business

maldehyde,
heavy

which

relatively short

in

ply

general

■ in
1958.

in

especially true

seem

billion of last year.

an^

mate 33%
for

.

and

chemicals

exand

20

21^-3

is

today

ago.

years,

in

success

times
Evi¬

efforts

these

cannot be

always determined from
statistics.
But, again using ran-

dom nicked comnanies

U

it

nn^
sales

that have

are

come

inter-

products

the market in

on

the last 10 years; about 30-35% of
Carbide's sales are from products
and

recent

in

about

the

last

25-30%

sales

were

10-15

of

years;

Pont's

du

from

products

developed in the last 10 years.
Last "year alone, du Pont offered
some

35

change

by the Custodian. I feel that the

from

ill' fundamental position
where explosives dom¬

inated

sales

to

general

in

*

a

business

.

.

^°-40 relationship between

indicated. ;

are

with

compared

The

last

year

projected

profit increase would seem to me
to compare favorably with other
growth industries. Without going
into
boring statistical details,: I
have calculated that earnings for
Allied Chemical, Diamond Alkali,
and

Hooker
,

.

,

j

jfuiL.

Rohm
,,

&

.

Haas

coulci

...

.

,

"a spi/nlllJ'
those of Atlas Powder, Dow,
of

Hercules Powder, Spencer ChemiStauffer could probably

upwards of 70% oyer 1958.

^^rHiHen^nviPoferfh^0^P^p!u
accor<Ied many of the
shares

are

for

historically high, there

to^be considerable room

appears

market

appreciation

as

the

and intermediate-term prof¬
its come closer to reality.

near-

It

would

Allied

appear

Chemical,

to

Atlas

that
Powder

me

expansion

fibers,

temperature

product

fields

plastics,

metqls,

food




as

high
addi-

Allied Chemical Corp.
Allied

largest

Chemical

chemical

is

the

company

third

and

a

will

be

of

which

gins

has

in-

.

snare and l

per

favorable

estimate

3j/$% Series

due 1993, filed with

the Securities

and Exchange

Commision

Copies will be mailed upon re¬
quest to any

OTIS

of the Company's

security holders or other inter¬

ELEVATOR

ested parties.

COMPANY

THE CLEVELAND

though the normal line

maintains a strong fun¬
damental position in Manitol and
Sorbitol, which have growing ap¬
plications as humectants, surfectants, and emulsifiers, used by the
textile, paper, soap, low calorie
beverage and pharmaceutical in¬

ELECTRIC

ILLUMINATING COMPANY

-

Common Dividend No. 210

By Donald E. Williams
Secretary

quarterly dividend of $.60
per share on the Common Stock
has been
declared, payable
A

April 24,
of

ers

business

Cleveland 1, Ohio

of

close

the

mailed.

be

H. R. Fardwell,
New

•

April 3, 1959.

on

Checks will
'

at

P.O. Box 5000

stockhold'

1959, to

record

Notice to

,.

Security Holders of

Treasurer

UNITED GAS

York, March 25, 1959.

CORPORATION

Darco activated carbons

are
the largest part of chemical
operation used in deodorizing and

respectively, estimated
and cash earnings,

1959

net

Company

A

quarterly dividend of 60c per

share

on

the Common Stock, par

value $13.50 per

share, has been

payable June 30, 1959
of record

stockholders

May

29, 1959.
A

quarterly dividend of $1.0614

has made spectacular
In my opinion, Stauffer's
management represents one of the

per

^es|- jn

July 1, 1959 to stockholders of

industry. It appears to
be one of the most agile and still
cost-conscious of companies that I
studied.

In

addition

to

a

good "bread and butter" chemical

poration and of United Gas Corpora¬
tion and Subsidiaries consolidated for
the period from March 1, 1958 to Feb¬
ruary 28, 1959, such period being the
12-month period beginning on the first
day of the month next succeeding the
effective date (February 26, 1958) of
the Registration Statement filed with
the Securities and -Exchange Commis¬
sion relating tb the sale of $30,000,000
.principal amount of First Mortgage
and Collateral Trust Bonds,
Series due 1978, of United Gas Cor¬

DIVIDEND NOTICE

progress.

years,

United Gas Corporation has made gen¬
erally available to its security holders
earnings statements of Untied Gas Cor¬

4

to

Stauffer Chemical Company

February 28, 7959

Improvement

declared

stauffer Chemical, over the last

Earnings Statements for Twelve
Month Period Ended

The United Gas

decolorizing in the sugar refining
and
dry
cleaning industries.
I
visualize earnings of this company jri the early 1960's exceeding
the $6 a share area compared with
last
year's $3.80 and estimated

have

$30,000,000 First

Mortgage Bonds,

under said Act.

mar¬

company

few

last

eqtimate

DIVIDEND NOTICES

polyester^compoundS' is quite
competitive, (2) the Aquaness di¬
vision at Houston, Texas, offers a
line of chemical specialties for oil
well drilling, corrosion inhibitors,
and other products for the petrol¬
eum
industry.
In addition, the

;

T

of

of

dustries.

statement for

.,

■

period

beginning after the effective date
of the Company's registration

ings in 1957 were equal to $6.75
.

earnings statement

February 28, 1959, such

substantially higher than
in recent years,
and

at the present time. Earn-

even

an

for the twelve months ended

been

command

even

amended,

government control

the chemical
helped some¬
what in the last few years by two
acquisitions — (1)
Thermoflow,
manufactures a line of specialty
polyester molding compounds
division

share

on

the

Stock has been declared

record

poration. Copies of such earnings state¬
ments will be mailed upon request to
any of the Corporation's security hold¬
ers and other interested parties.

% Preferred
payable

J. H. Miracle,
Vice-President and Treasurer

May 29, 1959.
.

J. H. Mackenzie, Treasurer

1525 Fairfield Avenue
Shreveport, Louisiana
March 31,1959

Philadelphia, March 24,1959

business, its growth potentials are
being expanded almost constantly.
Whereas

a

year or

two ago, high

temperature metals, high temper¬

DIVIDEND

fuels
and
agricultural
specialities
would
be
primary
growth areas of the company, it
now
appears
that we can add
plastics, ethical drugs and several
other high profit growth areas to

ature

of

new^

bowl

dustrial chemicals and explosives.
The

stock split was

such

fish

Securities Act of 1933, as

the

of

power

witnessed

Yet apparent but the new management,- instituted a few years
ago, ls-believed to have a goal of
a

provisions of Section 11(a) of

this company
its out of the so-called golc

once

high

margined specialty chemicals will
be the most important part of the
company.
This change is not as

jts bailiwick.

in

where

^

atively attractive in their respective quality groups and for
one that is a sort of special situation with many chemical aspects,
General Aniline & Film appears
quite interesting.

recent

one

holders, in accordance with the

public sale of the shares held

earning

one

and Stauffer Chemical appear rel-

developments
synthetic

rate

erally available to its security

up

different

new
products
ranging from Fiber "K," an experimental
synthetic
elastomer
textile
fiber, to a monosodium
glutamate, a flavor enhancer for
food. The industry is replete with

evidence

^

efficient

of good

panies

Manula^

&

from

^

installed and scheduled

cal

Mfnnewta^Mfning

^

nating Company has made gen¬

away another of
obstacles which has held

States

significant investment as¬
pect of Atlas seems to me is the

f.ev^~ years —sub- $4.25 for 1959. The stock is sellstantial profit gains for most com-,.ing about-18 times and 9 times,

Total

development

for

greater than

;

.

which

United

clear

the legal

over .the ne.xt

industries reached a new
high last year. Manpower devoted

,r

.

plant facilities will be operated at

allied

offered

^5

period

tensive research efforts.

turing's

industry.

sumlbS

*

ol

1959 for the

other

industry
must also 6
give con*
.sideration to continuing and in¬

esW tn

increase in net profits

and

-

"

approxi-

an

oxygen,

Current appraisal of the chemi-

of

therefore lead to

other

cal

dence

These sales,

with improved ef~
could
permit,
pretax
to reach an average* of
18% compared with 15% last year

ficiency
margins

maximum

research

$23.2

and

acids,

penditures

the

sulphuric

etc/

research

over

year

when coupled

Intensive Research

"to

this

aFroVJ—?t
longer term
^

-

gases,

industry spokesmen are now contemplating about an 8-10% rise in
volume

The Cleveland Electric Illumi¬

the
to

seems

The

:

,

v

at ,th^ Hague
rejected
for
a
ruling

application

against

Now

Announcement of

on

fuels in the
would

relatively

suggest

that

near
my

The Chase Manhattan Bank has de¬
clared a dividend of 60c per
the

future

longer

CHARTERED

share on

13,167,000 shares of the capital

stock of the Bank,

a

recently made, but
present shares outstand¬
ing, it would seem to me that
earnings in the $4.75 per share
area, can be anticipated for 1959
against last year's $4,pi. A pos¬
sible breakthrough of liigh energy
based

NOTICE

payable May 15,

1959 to holders of record at the close

1799*

of business

THE

The

Chase
Manhattan

April 15, 1959.

transfer

books

will

not

be

closed in connection with the pay¬
ment

of this dividend.
MORTIMER J. PALMER

BANK

i

Vice President and Secretary

$8

The Commercial and Financial Chronicle

(1568)

BUSINESS BUZZ

A
g~M
/lfHt

from the Netion'e Capital

Thursday, April 2, 1959

,

.

COMING

Washington...
Behind>the'Scene Interpretation*

.

EVENTS
In

A C/M

April 1-3,1959 (San Anionic,leju/
Texas Group of Investment

Bankers
;

w^onlNGTON, D. C.

,

Business

Small

in

created
:

The

—

Senator

,

J.

John

Democrat

Administration,
and established

1953

as

"■

member

permanent agency, has its

a

rency

Committee,

u

and

Small
is

other

pects

eral

He believes that the

departments of the Fed¬
Government, is a bit New

Business

enthusiastic

vestment

Nevertheless,
it
has
more
boosters on
Capitol Hill than
critics, or else it would not be
growing
and Vexpanding
its
scope
of
activities
with
the
blessing of Congress.
V One of the most
interesting

vide

ing

effort

the

in

through

creation

for

City)

(New York

.-

.

Wendell

J

:

,

•

Lack

of

growth
be

retarded

to

overcome

companies since

-act

an

The

licenses

new

on

and

its

Small

thermore,

Southern

Investment

Small

Investment

t

Atlanta,

$315,000 owned by 25

Investors

-

^stockholders, including 5%;

business

'owned by the Northwestern Na¬
tional Bank of Minneapolis. The ;

are

j

for

to

operate
not only in Minnesota, but Wis¬
consin, North Dakota and South

by

business

involved—.

are

ordinary,
deduction

losses

any

companies

an

resulting

from

plans to establish branch offices
over
Georgia.
The
company
also plans to raise capital funds
to $500,000 through the sale ofi

for

similar tax

a

loss on the
convertible debentures or stock
any

of small business

concerns.

.

An investment company must,

the

funds

to

small

such investment. The companies

Citizens
and
Southern National Bank of At- i
lanta.
The company—no gov- !
eminent

cov¬

capital,

themselves receive

company has an initial capitali¬
zation
of
$325,000, all of it'
owned

1940

asset

investment

than

deduction
small

of

licensed

in

entitled

rather

-

Atlanta

ex¬

borrowings and are
eligible for Security Exchange
Commission ' discretionary,• ex¬
emptions.
Y'i r '*• V '
v'" v'

Minneapolis company Was
organized with initial capitali¬

Dakota.

are

erage aftexv

The

company/proposes

Act

which requires 300%

Ga.

of

assist¬

empt from the p r o v i s i o n in
the

Business'

Company,

financial

the

if

possible, obtain its charter in

the state of its

domicile, if

pos-

j sible. However, the Small Busi¬
Administration

ness
■

can

grant

charter.

,

atock.

■

■'

.

*

.':

■

{.

■
,

*''

>

r

,

|

The SBA is insisting that pri¬
vate

funds

be

must

employed
i in the program, but Congress
has made available $250,000,000
'

Spark man Enthusiastic
benefits

terms

of

the

{result

in

more

how

['

provided, under
are
likely to;

act

and

being

the jwhole

more

eom-!;

organized.
Just
plan works out

loans

and

purchase

bentures issued by
ness

outfits.

Smalb business

'

invest-,

will

provides that grants
1 up
to $40,000 to state agencies
\ and
tional

institutions for research
into problems of small business.
Small

what

small busi¬

been

is

a

small

debated

years.

Under

small business is defined

a

as one

manufacturing
a

business
and

pro

con

of
has

for

51 Proposed

that is indepen¬

dently owned and operated.

formation

A

carries

concern

SBA.

fewer persons, and large if it

employs

than

more

1,000

Some of them of

forth.

On

nated debentures and other obli¬

17

gations

rating and

ness

loans of

or

small

busi¬

investment companies, pur¬

chased

will

5%

be

may

made

or

be

a

by the

bentures

of

The

year.

adjusted

Maturities

rate

periodically.

subordinated

de¬

the Small
Administration
will

be set by the
agency not
cess of 20 years.

operations

business

of

ex¬

or

may

An

rendered

to

fees

for

hanks

not

use

says

Federal

Federal
Bank is authorized to
any

fiscal

more

complete
far

so

an

when

he

requirements."

can

could

be

the

act

agent

~




Cities

annual

meet

Bond

picnic

Club

and

38th

outing

White Bear Yacht Club,

Small

Busi¬

a

Activities

-

a

,

at

White

Nicollet

very

the

of

Lake, Minn, (preceded by

cocktail party June 17 at the

June
-

Hotel, Minneapolis).,

25-27, 1959 (Hyannis, Mass.)

Consumers Bankers Association

ing, Wianno Club.

1959

calendar

the agency approved

a rec¬

total of $119,700,000.

the "Chronicle's"

States Sectional meet¬

Aug. 9-21, 1959
Va.)

(Charlottesville,

•

of

Consumer

Banking,

University of Virginia.

own

views.}

TRADING MARKETS
American Cement

Botany Mills
Heywood-Wakefield
Indian Head Mills
W. L. Maxson

Morgan Engineering
National Co.

Carl Marks

& r.o.

Inc.

1927

Southeastern Pub. Serv.

United States

SECURITIES SPECIALISTS

20 BROAD

STREET

•

NEW YORK 5, N. Y.

TEL: HANOVER 2-0050

HAnover

Twin

from

and may or may not coincide with

for

SEND FOR FREE BOOKLET

Washington St.

(Minneapolis-St.
Paul, Minn.)

months

a

Association

outing
Country Club.

June 18, 1959

School

investment company.

SHOWING LISTS nnd RATES.

83

at the Overbrook

,

become "

the

New

(Philadelphia, Pa.)

Atlantic

of

of

of Philadelphia Summer

re¬

[This column is intended to re¬
flect the "behind the scene" inter¬
pretation from the nation's Capital

a

as

12, 1959

Investment Traders

but

the 'Investment

E-Z ADDRESSING SERVICE

June

Administration in the years
could

Club

Summer

com¬

been

applicant

the

at

outing at West¬
chester Country Club.

However, rejection does

prevent

outing

12, 1959 (New York City)

York

applications

regulations,

has

one

2,628 for

Reserve

(Boston, Mass.)

summer

Municipal Bond

sub¬

ord number of loans—a total of

also available and useful to in¬
dustrial and commercial busi¬

or

011

proposals

Rosa,

;

■

agency appear to be increasing.
For instance
in
the
last
six

year

Reserve System and the
Depart¬
ment of Commerce, which are

depository

more

with

business.

the

com¬

of the ad¬

visory services of the

Any

com¬

June

large Federal business for small

Administrator Barnes

panies may make

has

review,

"Several

for

ahead

other

Santa

-

,

Boston Securities Traders Asso¬

Bear
It
ness

financial institutions.

Motel,

,

June 11, 1959

comply
They may

staff

all

of

reapplying
our

services
or

their

jected.

investment company

receive

review

half

only

handled through banks or other
financial institutions
on
a fee
basis.

Calif.

Salem Country Club.

pliance

be

may

(San Francisco,

with SBA regulations.

posers

other financial institu¬

companies

Flamingo

incorpo¬

have been returned to the pro¬

Any servicing or investi¬
gation required for loans or ac¬
quisitions of securities of the

1959

San Francisco Security Traders
Association at the Santa Rosa

to

approval

start

Exchange

Calif.)

the

ciation

recently.

tions.

investment

June 5-7,

mitted to date," Mr. Barnes said

company,

undertaken, wherever
practicable, in cooperation with
banks

given

hand

Stock

of

amend their charters to

than

FOREIGN

THE

at

ing at the Pfister Hotel.

course

naming their board
of directors, or if they have already incorporated, proceed to

pleted

small

be

may

other

companies to

"The

in

a

investment

Brokers, Banks, Analysts,
Advisers, Funds, etc,

,

party

summer

Firms Board of Governors meet¬

also proceed to raise their cap¬
ital funds.

bought "by

Business

The

-

agency,

the

has

agency

subordi¬

on

com¬

will not meet the regulations set

per¬

sons.

The interest rate

Association

investment

of

FINANCIAL MAILINGS to

since

Angeles

Biltmore, Palm Springs.

May 25-26,1959 (Milwaukee, Wis.)

panies have been submitted to

lLISTS in

^eri Ing TTuli Street

(Los Angeles,

Association annual field day.

Companies

Thus far 51 proposals for the

"small" label if it employs 250

or

nesses.

Business

Incidentally, the question

de¬

Act

broadly

small business investment

The law

Definition* of

*

.

loans to li-

as

i ment
companies.

,

the
Investment
Act
licensed
companies like the Atlanta and

Minneapolis companies

| censed

funds

public^ and private educa-

after 3, few years will be inter¬
esting to watch. Under terms of

;; make

of Federal

'

Spring
Club of

May 19-20, 1959 (Omaha, Neb.)
Nebraska Investment Bankers

companies licensed

license companies

ance,

Minne¬
Citizens

the

for?—well—"

,

.

annual

Security Traders Association of
Los

"Hello, J. C.—you know that rainy day you were saving

SBA can lend com¬

Besides

Business

Company,
apolis, Minn., and the

(Baltimore, Md.)

Calif.)

minimum of $300,-

a

dinner

annual

24th

May 15-17, 1959

property
that it is acquired.

panies up to 50% of their capi¬
tal and surplus.
- /

<

23rd

Waldorf-Astoria.

Baltimore Security Traders As¬

tangible

paid-in capital and surplus,
SBA
can
provide up to
$150,000 for such purpose. Fur¬

crea¬

York

the

May 15, 1959

a 20% write¬
of the cost of

is authorized

Investment

issued to the !

were

Midwest

panies

New
at

oper¬

years

A

but

August.

Investment

; Tax

May 1, 1959 (New Yrork City)
Security Traders Association of

outing at Country
Maryland.

must have

.

Municipal
Dealers
annual spring party at

to go

business.

000

This may be
"par," but it appears a bit slow.

The

the

of

$300,000 Minimum Capital

re-1

law,

Louis

Group

small

small

(St.

1959

1,

Mo.)

business also is permitted

the first year

to be determined.

last

zation

St.

prod¬

new

29-30-May

Louis,

back three

certain !„

a

this

through

tion

and

April

the Sunset Country Club.

terms

depreciable,

only two small business invest¬

First

of

Canada)

(Toronto,

sociation

off

The agency so far has licensed
ment

to

':

>■

ating losses,

many
small busi¬
Whether this handicap

degree,
mains

has

J

the

-

Investment Act.i

capital

development

1959

annual dinner at the King
Edward Hotel.

*

of

nesses.
can

the

money

10,

{ tion

,

pro¬

sound

paying the estate tax up to a
10-year period, providing the
estate is tied up principally in

B.

over

for

dinner

annual

Toronto Bond Traders Associa-

.

original investor in a little busi¬
deduct stock losses. A
taxpayer also has the option of

Barnes, Adminis->
trator of the Small Business Ad- {
ministration, expresses opti¬
mism

J.C. BLOOPBOTTLE AND CO.

ness may

privately-

.

Apr.

Act.

Security Dealers As33rd

at the Waldorf-Astoria.

small businesses, ex¬

new

Under

un¬

and privately - operated *
small business investment com- f

j-

/r--'

sociation

pand existing ones, and provide
ucts.

owned

panics.

pros¬

will

funds

financing and provide

of
enterprises

of

*-'
*

private in¬

companies

needed

create

financing

business

the

over

the -Investment

of

Dealish.

dertaken is the current pioneer¬

r

Amer¬

of

v.-

3, 1959

New York

-

Administration,

of Congress feel that the agency
which is expanding like some

small

of

one

the stauncliest supporters of the

Some members

functions SBA has thus far

;

Hotel,

April

of the Senate Banking and Cur-

f

:

;

*

share of critics.

;

Association

ica annual meeting at the Hilton

Sparkman,

Alabama,

of

Field

Investment

*

TELETYPE NY 1-971

.

LERNER & CO.
Investment

10 Post Office

New York 6, N, Y.
2-9492

J

I

li-i

\

'

\

ilifi'i -ftiftifiiVi-riWrifrriiir

Envelope

Telephone
HUbbard

Securities

Square, Boston 9, Mass.

2-1990

Teletype
BS 69