Full text of Commercial and Financial Chronicle : April 25, 1946, Vol. 163, No. 4484, Section 1

View original document

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

APfi a 6

SUS. ADM.

LIBRAfffinal Edition

ESTABLISHED OVER 100 YEARS

In 2 Sections-Section 1

Reg. U. S. Pat. Office

Volume

163

Number 4484

New York, N.

Production, Money

Price 60 Cents

Y., Thursday, April 25, 1946

Copy

Widening Big-Powei Rift Demonstrated at UN
By A. WILFRED MAY

and Inflation

Procedure

Iran and

over

Spain reveals basically conflicting political interests.

//',"

Soviet's attitude

By A. M. SAKOLSKI

Economist points out that slogan "more production will stop infla¬
tion'! may be erroneous, and that increased production, unless it is

properly balanced and kept in check by credit safeguards, may lead
to still greater inflation.
Contends large existing money supply#
does not necessarily mean increased purchasing power, and that
without a sound fiscal policy and an artificial decrease in circulat-

ing medium through drastic debt reduction, Inflation" prices will

decline.

not

Holds low interest rates combined with

1 ible currency
An

from

fosters inflation.

inconvert-

HUNTER'COLLEGE, New York, April 24.—On the first anniversary of the San
deliberations which formulated the United
Nations Charter,
the Security
Council's ninth meeting since Mr. Gromyko's epochal "walk-out" terminated with the
Soviet's representative's expressed intention of withdrawing again.
Again this refusal
\ "to
play" is occasioned by the Security Council majority's overruling of the Soviet's de¬
f mands in the Iran
matter; but this time the implications seem more serious than those
which attended Mr. Gromyko's previous huffy exit. '
'
,

For the

present crisis, wherein the Soviet will doubtlessly not conform to the Coun¬
cil's resolution, either by bringing in a report on

pro-

ductionon

May 6

money supply
and prices has

commitment,

A World Government

credence

The public has
been smoth¬

Asserting regulation of conduct of

soon

production

men

Court\v

and clime by just

every race

to problem of world peace, ExJustice Roberts contends United Nations does not

rules, justly enforced, is only

catches up
with the de¬

answer

perform this function, but constitutes merely a great
alliance between Russia, Britain and U. S.
Points
A, M. Sakolski
out that superior military power of this country,
:
besides being ineffective in atomic warfare, cannot
down and inflation will be cur¬
be maintained except "by abandoning aU the dear¬
tailed. On this ground proponents
of further price control justify est things cherished by a democratic people," and
the continued efforts to hold down
urges U. S. to propose a union of peoples and a
mand

caused

by the large
money supply,
prices will go

Its administrators argue
long as money is in large
supply and goods are in short sup¬
ply, prices will rise, and accord¬
ingly, they will agree to removal
of controls only "when produc¬
tion has caught up with purchas¬
prices.
that

power." Manufacturers' and
retailers' organizations, together

ing

with

economists and

politicians,

(Continued on page 2243)

/v.

on page

table,

fit—with

saw

significant

glance of the highest British suavity at the Soviet

delegate—to "assure him that such an appeal
coming from the delegate of Poland will find a
sympathetic echo in my country, which had the
honor of being the first to declare war on Hitler
ih support; of Poland. I can assure him also that
country, having fought through every day of

and the

alleged

of the other Powers. Yesterday he charged

purposes

bringing in

eight-to-three report adverse to the pro-Soviet opinion of SecretaryGeneral Lie, were not
selves

"on

orders"

who will prove
Owens J. Roberts

acting

technicians but had stultified them¬
superiors (as statisticians

their respective

from

either side of any question). In a larger sense—a la

veering

persecution complex—the Russian attitude unfortunately is
(Continued on page 2258)
vh
,

about the situa-

the

by Justice Roberts at a luncheon of
Hotel, New York City, April 22, 1946.

(Continued

Alexander

that the members of the Committee of Experts, in

address

'V,

Sir

Of 1939 barely missed being openly brought onto the agenda here..
/ • C;Mr. Gromyko is ever more frequently indicting both the methods

ly, and in a crisis like this it seems to me a sur¬
prise that the great body of our electors are not
thinking seriously, earnestly, almost prayerfully,

Gaumont British /

both' "sides."

A, Wilfred May
World Wars, is not insensible of the vital
necessity of averting the occurrence of such hor¬
rors." Thus recrimination over the embarrassing Moscow-Berlin Pact

bring to you that is
novel, that has not been said, that has not been
written, that has not been thought of for quite
a time past, but yet what I have to say and the
facts that I bring to your attention seem to me
not to have impressed the American people deep¬

♦An

Council

two

I have nothing to

Waldorf-Astoria

utterances

Parliament of the World to maintain peace.
...

Iranian

Of its

fulfillment

Cadogan, in discussing the Spanish situation at
the

state ments
that

the

by remaining at the table to dis¬

By OWEN J. ROBERTS* ;
S. Supreme

the matter at all, reflects an undisguised
widening of Russia's fundamental rift with the
other Big Powers.
/'■ /■':•//'?:
Deep-rooted recrimination is cropping out in

the
,

Former Justice, U.

with

ered

regarding

cuss

To Enforce Peace

recent months.

to scut¬

Francisco

exaggerated ballyhoo, emanating from political as well as
and academic sources, regarding the effect of in¬

gained wide

Council threatens

Organization's future site plans constitute a mess unsatisfactory to all
concerned.
Preliminary Economic and Social meetings next week.

industrial

creased

reflected in its renewed rebuff

tle it.

Associated

Press,

Index of

Regular Features

2268,

appears on page

2250)

■

Slate and

San Francisco Mines
;

Aerovox Corp.*

Pratt's Fresh

Nu-Enamel

Frozen Foods, Inc.
Common

Prospectus

request

for Banks, Brokers

Established

CO.

HIRSCH, LILIENTHAL &

INVESTMENT

Members New York Stock Exchange

and other Exchanges

25 Broad St., New York 4, N. Y.
HAnover

Teletype NT 1-210

2-0600

Cleveland

Chicago
Geneva

London

(Representative)

■

•

■

•

,•

■'

INCORPORATED

WALL ST.

NEW YORK

CORPORATE

■

FINANCE
''

York Curb Exchange

New

DIgby 4-7800

New York 4
Tele. NY 1-733

THE CHASE

NATIONAL BANK
THE

CITY OF

NEW YORK

INCORPORATED

Members N.

Security Dealers Ass'n

Tel.

REctor 2-3600

Philadelphia Telephone

New York 5
Teletype N. Y. 1-876

Enterprise 6015

Public Service Co.

Conv.

Preferred

Analysis

Winding Co. Com.

Prospectus

request

Members New York Stock

HART SMITH & CO.

BHi

REctor

Teletype m v

Exchange

York

WILLIAM

Security

Members
and

Dealers

ST., N. Y. 5

Bell Teletype NY

Asm

HAnover 2-6980
1-395

2-8600 *
i-6Sf

request

irahaupt&co.

Members
New

Broadway, New York 6, N. Y.
Telephone:

upon

Reynolds & Co.
120

England

Conv. Preferred

$2.40

Kobbe, Gearhart & Co.
45 Nassau Street

New

Preferred

^Raytheon Manufacturing Co.

MEMBERS NEW YORK STOCK EXCHANGE

Conv.

*SoIar Aircraft Company

SECONDARY

*Universal

Members

*Detroit Harvester Co. Com

MARKETS

TELEPHONE--RECTOR 2-6300

York Stock Exchange

Tel.

LOS ANGELES 14

Common

BROKERS

NEW YORK 5.N.Y.

Members New

30 Broad St.

634 SO. SPRING ST.

90c

14 WALL ST.,

Bond Department.

Acme Aluminum Alloys, Inc.

•

BULL, HOLDEN & C2

Hardy & Co.

.ONG

York 5

Troy
Albany
Buffalo
Syracuse
Pittsburgh
Dallas
Wilkes Barre
Baltimore
Washington, D. C.
Springfield
Woonsocket

mO
* ">■

SECURITIES

PHILADELPHIA

BOSTON

and Dealers

Wholesale

•

BOND

PROSPECTU

1927

64 Wall Street, New

|
v}

Bonds

Service

R. H. Johnson & Co.

Successors

Stock

Municipal

Brokerage

Prospectus on Request

Hirsch & Co.
"V-

Bond

111

New

York 6

REctor

York

2-3100

Exchange
Exchanges

Stoek

other Principal

Broadway

10 Post Office Sq.
Boston 9 1

Hancock 3780

Tele. NY 1-1920

Hew York
■

Montreal

Toronto
Direct

Private Wire to

Boston

£
•

•v -,

'v-'V .
,i ■>■'

<■■■

•■*1

•>

£•

';,i4

2214

> THE COMMERCIAL & FINANCIAL CHRONICLE

'•*:

•-•

-B—(• -.

,v A

Thursday, April 25, 1946

'1V

■

•

Trading Markets in:

Stand. Gas & Elec. Com
L. E.

Carpenter & Co.

Professor Emeritus of Economics

Benguet Consol Mines

University of Nebraska

Universal Camera

Veteran economist reviews the theories of fair

king & king
..

Ass'n

Nat'l

Established 1920
j^tribers
"

York

New

•

Ass'n
Dealers, Inc.

Dealers

Security

Securities

One

HA 2-2772

Exchange PI., N.Y. 5

S CO., INC.

from ancient to modern times and points out the
factors, viz: the cost of living and the productivity of the worker. Holds the present
wave
of strikes illustrates the difficulty of
harmonizing these factors and bringing them into equili^
brium. Concludes the question of what is a fair, ju si and reasonable wage seems as elusive as ever,
but suggests that an equilibrium of fair
prices; pro flta and Wages may be obtained where employees
and employers can bargain in a free
market.■'A
wag es

conflict of the two

U. S. Sugar

•

P. R. HSLLORY

By J. E. LeROSSIGNQL

Bought

sages of ancient times must
have throwh clear light upon this

HAnover 2-0700

New Orleans.

because: of the

prevalence

of>

William. Chamberlain discusses further, effects of foreign grants*-in-aid on nur inflated money supply.
Holds continuation of policy V

interpreted by

Plato,- dis¬
courses
nobly
on
*
j usti ce,

Bought—Sold—Quoted '■>.

which

the

visions

and
120

WOrth 2-4230

ing

LeRossignol

—in the

ideal

•

.nished

' tie pub liewise, the sol¬
diers brave, the common people
industrious and; obedient, and all

Rogers Peet
Common

C ll 1'

are

;

n^rmonioiis

cooperation with
fpllow-citizens. By way of
reward for this, everyone is to re¬
ceive

his

}

Common

needs of the

what

Bell

goods

Plato

New York 5

System Teletype NY 1-1548

(Continued

•/_,

A-'

Common

Central Public
r'. SJ/2s, 1952

2238)

on page

'■

v7 -Common

Guaranty Co.

Bldg. Corp.
Stock

Capital

»*.

0 r

which

cautions

i d" to f

Members

■

Telephone: WHitehall 3-1223
Bell

Teletype NY 1-1843

7.7.'

York

Stock Exchange
New York Curb Exchange

New

world's

resides ' in .Saratoga,
Calif.;-: and who was formerly

to the

the

world's ..commer¬

Kaiser-Frazer

POWER &

offer, in lieu of

public

treasury

should

never

MINNESOTA

British

circumstances

extraordinary

DREDGING
&

Canadian

Members N. Y. Security Dealers Assn.
37 Wall
Bell

St., N. Y. 5

Teletypes—NY

■Jf

k .•

;

VASKli

Our Own Situation/
letter

that for

Telephone BArclay 7-0100

n.'y.

Teletype NY

-i.rP

1,">

:' r.W-*

;•

•

Consolidation Goal

Western' Pacific 5s/45. *

Chicago, Mil., St. Paul & Pac.
■777:7p;,:7v 7',':' 5s/2000 v
: 7j

Minneapolis & St. Louis R.R. 'u
All;Issues '7:!.: aj
'

Gude, Winmill & Co.
Members New York

:i 1

Stock Exchange

Wall St., New York 5, N. Y.
Teletype NY 1-958

Digby 4-7060

Congressman
than

Eastern Sugar Associates
'•

j12 years

ment

;

Common

Punta

Alegre Sugar
Upon

Request

FARU &

CO.

Quotations

sounds,

alarms!; to its own
for itself refuses to

r-y

,7;:; 7)7 •;

because the national pro¬

things is insufficient'to meet the
abnormal demand created by its
:

deliber¬

duction and supply of purchasable

1-672

circulating medium "is already

That

' '

;v.

•

Consolidated Film Ind.

and calculated policy of curand; credit inflation; that

citizens but
heed them; -.r.7:

NEW YORK 6
HAnover 2-9470

•

yr Buckeye Incubator

grossly inflated; that the, Govern¬

Goodbody

8T.

WALL

.'■.u v<.

rency
our

,71

7 new york

toward the
with -equal

have been following

ate

PAPER

MINES

and

Request

York Curb Exchange

Members New
64

Teletype NY 1-1140)

'/-* ■'

.■

Frank C.Masterson & Co.

Anderson I called attention to the

Securities Dep't.

115 broadway

1127

heavily

grant

In*my
fact

Members Ni Y. Stock Exchange and Other Principal Exchanges

Hanover 2-4850
1-1126

Prospectus,

weight against .the others.

ONTARIO

STEEP ROCK IRON

arn^

weigh

now

be made except un¬

Common & Preferred

and

•

siderations 'of national safety may

foreign :• states

COMPANY, Common & Preferred

Works

,7.7,7.7,^^'.77

Wilson Brothers Com.
*

that opinion, • though as I shall
point out before concluding, con¬

conduct:

PAPER, Common & Preferred

BULOLO GOLD

7; United Artists .77
United Pieta Dye

other...

Conimori

severe

7777*"'' K ':7

Common Stock;

Hotel Waldorf-Astoria

financial

was

BROWN

:_v"';

Colonial Utilities Corp.

grants-in-aid which
the financial rehabilitation of for¬
TP opposed) Ingoing so I
propose
eign states, offended against each
to
set
down
certain principles
of. these principles.
I. am still o*
which: I suggest as a guide to our.

We Maintain Active Markets in U, S. FUNDS for
ABITIBI

Teletype NY 1-1919

Central Slates Elec. (Va.)
7

opinion on Jan. 11,
the date of my letter to Congress¬
man Anderson, that the; proposed
grants,., as part of a program for

■

Boston & Maine RR

yl; Colonial Mills ||

strength cannot
be achieved through the practice
of inflation and efforts -tq sustain
foreign, governments .engaged in
that, ! practice
by
grants-in-aid,

nqw

Today I will answer: your ques¬
as to what alternative toward

der

foreign

circulating medium
provide grants-in-aid to foreign
in the hope of promoting
foreign trade are utterly without
justification.

First: Substantial gifts from the

■

:;j

Mr% Chamberlain, if;Fourth: R,estoration of the

ients of the aid.

„

120 BROADWAY, NEW YORK
Tel. REctor 2-7815
7- ,77 :7

Stamped Preferreds

government
severe inflation
a

states

cial ills I would

Bought—Sold—Quoted

Broadway WHitehall 4-8120

Bell System

tion

McDoNNELL&rc

20 Pine Street, New York 5

than

inflation of its

William Chamberlain'

the proposed

H. G. BRUNS & CO.

gifts to

states. by

already Jsuffering, from

our

alleviating
7

of- meeting that danger.
Third: "Large emissions of cur*
rency or credit by a government

economic

who

Members New York Curb Exchange

na¬

pose

o r-

;;-f
stability, but als<j> do not prevent
the inevitable ruin of th£ recip¬
own

clearly

circulating medium is with¬
out justification except in time of
national danger and for the pur¬

nations
disguised as
loans, not only

yv.y*.

v
I

Members New York Stock Ex6hange '

■

a
a

of its

i gn

threaten

of
rvf

understood

having

purpose

suffering from

—

that
-

well

monetary

state

ex¬

lending,

"grants
a

tial

tionary
of

and

Light Co., and is a director of sev-y
eral public service-corporations,
writes as follows:
.7 ' 7->7;;• while-wasting the substance'of the
-''-V:
one, are without permanent value
'::-":7
7:'-I
z

Home Title

;

Publicker

Second: The making of substan¬

President of the United Power &

Utility

Central States Electric

Lincoln

Byrndun Corporation
■

i g n

not

does

f 1

advancement
d/l<7QnnpmPrlt

nominal chance of realization.

the

cessive si

enri

defined
tional

service 7 and the
community, but just

Aristotle, the other great Greek
philosopher, does not go much be¬
yond Plato in his discussion of
this question, though he tries to
be
more
realistic
and
specific.
Distributive justice is found in the
exchange of goods and services,

' I'etophone COrtlantlt 7-4070

■

ac¬

York Curb Exchange

Members New

more,

the;7;7...:j;::V/'-:^~*
j C1 C** '7

-7'v,-'-

published in the issue of April 11 (page 1927), has fur-

recently writ¬

effects

f :v;7 yy7. ''■>

say.

31 Nassau Street,

should be in terms

that

money

Vanderhoef & Robinson

and

'
:

ten to a* friend •
i

to; his

cording

W. & J. Sloane

due

yy-Fy.y 7% Preferred

Tetter

regarding

their

Mississippi Shipping

0 11

with

lyork together for the general good

i j'

was

Electrol

"William Chamberlain, whose article on "The Purchasing Power

Fallacy"

when the rulers

■••

the

77;:r

Central States P. & L.
;■

handicap[ her in competition 7 withAmerican;' mass

branch offices

our

—v.-

Globe Union Inc.

secnr*'7
Holds restrictive pro*,

;Anglo-American Financial Agreement weaken Britain

production.';^

state. It exists

Y. 1-1227

Bell teletype N.

well-be¬

•

aiid;; cruelly

health, beauty,
Stock Exchange
Broadway, N. Y. 5
*

in financial distress in

now

ing return to fiscal honesty and sobriety.

chief good, as
b e i n g
the

Members Baltimore

with Governments

MY 1-1557

Anderson Pritchard

making "disguised loans" will; hasten our own ruin and only
Suggests that we make

delay the inevitable - ruin of others.
common cause

La.-Birmingham, Ala.

Direct wiret to

;

slavery in
those r days.
Socrates, as

TEXAS CORP.

25 Broad St, New York 4, N. Y.

probably

n°t,

Quoted

Members New fork Stock Mxchange

perplexing problem, but they did
,

—

Steiner, Rouse & Co.

might think that the saints

and

BELL TBIrETYPE NY-1-423

Sold

—

(Continued

page

2240) H

;

York Stock Exchange
Exch. Assoc. Member
York Coffee A Sugar Exchange

Members

New' York
New

120

New

Curb

ST.,

WALL

NEW

YORK

TEL. HANOVER 2-9612

;

JLL

Bowser Inc., Com.
*

District Theatres

For Banks, Brokers

Corp.
Trading Market

Common

Harrisburg

Steel

& Dealers

FEDERAL WATER

x't

7.'7

^
r

Unliste

& GAS CORPORATION

Securities i

Corp.

Common

Common Stock

Western Union

Leased Line Stocks

Telegraph Co.
Telegraph Co.
Southern & Atlantic Teleg. Co.
Empire & Bay States Teleg. Co.

International Ocean

San-Nap-Pak Mfg. Co.
,7

-'Common

telecommunications

BOUGHT

—

SOLD

—

Pacific & Atlantic

QUOTEDS
MICHAEL HEANEY, Mgr.

Bought-—Sold—Quoted
[

■

r.'

* Prospectus Available

■

Memorandum
,,

Simons, Unburn & Co.
Members New York Stock Exchange

25 Broad St., New York 4, N. Y.
HAnover 2-0600

Tele. NY 1-2908

Troster, Curries Summers
Members N. Y. Security Dealers Ass'n
74

Trinity Places N. Y. 6
HA 2-2400
Teletype NY 1-376-377
Private Wires to Cleveland

Detroit

Pittsburgh

Louis

J*G-White

on'request

8 Company

INCORPORATED,.

37 WALL STREET

NEW YORK 5

WALTER KANE, Asst.

Mgr.

bought

Joseph McManus & Co.
Members

New

York Curb

Exchange

Tel. IlAnovcr 2-9300

Tele. NY 1-1815

39 Broadway
Digby 4-3122

New York 8

Teletype NY 1-1610

quoted

Arnhold and S. Bleichroeder
INC.

Chicago Stock Exchange
ESTABLISHED 1890

aold

30 Broad St.
WHitehall

3-9200

New York 4
Teletype NY 1-Sl8

Volume 163

THE COMMERCIAL & FINANCIAL CHRONICLE

Number 4484

Practices of making "inside allotments" by underwriters and -selling

}■":
§'

AND COMPANY

Secretary Vinson, though maintaining that legal limitation on public
.debt has no practical significance, does not object to a limitation

j
1

Urges Congress not to set debt limit

flexibility in the debt management

| curities and Exchange Commission is circulating a proposed
rule *X-15c2-3, and inviting "comment and suggestion." .
,

%are

| has made "a study" of distribution practices following cer-;
.

r,tain offerings "to ascertain the facts apd reasons bringing
; ■ ;
7;■ ■■7;7
7 7-7; \
•
: ■

-about this situation."
*

issues selling substantially above the
in the prospectus.,

i-.'v-. The need for
■it

...

The situation referred to is that which results in certain

seems

"study" escapes
;h '
'

to be naive.

tion through
I

;

7;7>:
us,

vV. 7•

low

use

as to

April and because

you my

7 ,7

$275,000,000,000.

I am in

views

and emphasis upon
y
'
•
>•

you

knowledge that ion the pubunderwriters

common

lie offering date the traditional policy of' many

and

WALL

■

;

com-^—•———•——:—.

■

.—'

*Given in full in "Chronicle" of

April 18,

third page.

duced, but I
also thipk that
it
should be]

residual

(anqther.7 The

,pn

public debt is

the

figure.;

SEC's Pr

-come

Changes

Secretary Vinson

rapidly

the

before

HAnover 2-8970

Committee

Senate

General Panel

Com., Pfd., Units

Allotments to "Insiders"

Can Its Excess Be Eliminated?

*. T.*

*■ *

•••

■

,,v'

•

-1

J. F.

Exchange PI., New York 5 j
HArioypr* 2-4,785
TWX
1-2733-4-5
So.

•

| accommodate in today 's issue-some of the letters already in
and these appear

both

herewith; Others will appear in sub¬

additional letters and would ask that they be

Editor, Commercial and Financial
*Kew York 8, N. Y.
k

L S;

addressed to

' "

dent

completely unable -to
buy attractive new issuo $tocJks efoherfos a selling
group member, less a concession, or even AT THE
ISSUE PRICE!

My firm has been forced on many
into the open market, to pay sub-

stantiaj premiums
will be furnished

■7

can
t

'•

and do sell

;

616

along -money, is- enoygh, nqr point to

Give to the

.2261)

Weave interested in

(Continued on page 2241)

Axelson Mfg. Co.

Billings & Spencer

Doyle Mfg. Com. & Pfd.'

Hi m o d & [o.m
Members New York

tTO Broadway
Bell

Security Dealers Assn.

WOrth 2*0300

System Teletype

1-84

yHaytian Corporation '
Punta

offerings of

«■Telephone HAnover 2-4300

General Aviation Equip.

Pressurelube, Inc.

DUNNE & CO.
Members New York Security Dealers Assn.

25,Broad St., New York

Teletype NY 1-5

^«ea Fabrics

•;,7|7.7;;;2 U. S. -Sugar

York Stock Exchange

New

Members

Alegre Sugar ;

Eastern Sugar Assoc.

PREFERRED STOCKS

Ohio Match '

Public Utility and Industrial

Miller Mfg.. Co.

business to attain its normal vol-,

|ives

High Grade

41,

?77Dv'7'7:y7 25 Broad Street, New York 777 7r

Oxford Paper

New York

Thiokol Corp.

the

Spencer Trask & Go,

| Crowell-Collier

RED CROSS

.■

•

Chicago

TRADING MARKETS

apparently small dealers

on page

correct amount.

problems such as

current monetary one. -Jt

only "sour" stock issues,: and that we

(Continued

practical / plan. for providing

ex¬

''Cleveland

.c"', " : *"
an
effort
to
o After the
collapse of fhe_ hull
market
:
of1926-29,' I :expected
..Jfod a"~ sohl-

request);

(b) Customers complain that

tion for intricate

so far as I can see, Re
does not' actually -tell how.-myiqh

lem, but

bl e

periences

JE.dS. Pjllsbury

the

foeir

fcjrstocks and.Sl^'flonds.Cj^mos
on

finally to Congress, to appoint a
Commission to study ;the prob¬

foe

of T:

■

qui t

with

(a) Many,small dealers have ibeen

leaders

top

like the Presi¬

;

the

aging. -when

Ghfonicje* 25 jPar)c JPlfice,
1

being wholly, in foyor of it for the following

point - to
a Y workable
scheme
for
accomplishing /-. the
result he hopes for.
Mr.,Parkin¬
son appeals to the bankers, to the
Federal- Reserve authorities, and

It js encour¬

proposed rule (X45C2 3)yT yvish to

occasions to go

in,

following,

come

In reference to the

DEALER Kp.

reasons:

Chicago 3
TWX

\Los Angeles

actually

ing to answer

sequent issues. We shall be pleased to continue to receive

Salle St.,

Private Wires:
Boston

'■

record

RAndolph :8924

•

Reilly &Co.,inc.

•

'-r,7

"go

Teletype NY 1-1203

by Secretary Vinson;

JE. S. Pillsbury writes Editor fbat, with a convertible currency, the
;
"Chronicle,!' oh page 2071,, ?
supply ^an ,be automatically adjusted through processes of trade.
editoriaHy cf'^N.ewi.Issuesr—Realism or .The-.
Favors a gold backed .currency and. limitation on paper issues.
«,ory") on the plan of the Securities and Exchange Commis¬ — Braises Thomas I. Parkinson for condemning "bad" money.
7
sion to ban, via proposed rule X-J.5C.2-3, allotments of new
"9• 77-—'",'.7;777
•* 7.7
' 7.'7^7-.'7vy—•'1'^y—V-7-vc'*'
:
Editor,"Commercial
& Financial Chronicle:
;
security issues to so-called "insiders.",The same issue conl
Your March' 28 and April 4 issues .contain addresses, by Thomas I.
|iained a statement issued byJtlie Gorpmi
.with, the Parkinson, President of the Equitable Life Assurance Society, in
text of the proposed -regulation* -j
7 V, ;2| ^
.;7-7777 •— 77;./7 "which he asks^
the first' of current monetary one.
It gives
r;7'- In connection with the subject, the -'Chronicle" invited
the
a.b.o y e one renewed confidence in demo¬
dealers and other interested parties to comment thereon,
J 'questions.- I cratic .processes, even though, as
said views fo be submitted anonymously. We are .able to
in this case, the speaker does not
am undertak¬

{

'we commented

k- hand

Assn.,

Broadway

New York 6, N. Y.

Finance, April 23, 1946.
(Continued on page 2255)

;; •,... 7 '• >..7'7
possible con¬
sistent " with foe. .maintenance ,of

Holding Co.

Broadway

Members New York Security Dealers

about only after the Treas--

^Statement-

reduced ad|

jDye Works

L. J. GOLDWATER S CO.

7 In the April 18 issue of the

,61

/ \j

(Continued;on page 2226)

Dealers' Views
on

Piece

Huron

The alleged -"study" is surplusage.
By the newly proposed rule the SEC attempts to place

Ban

down

amount

Hotel

Commodore
United

cause

debt to go up on one occasion

and

public ^ebt
should be re¬
.

foe

Not only do X
think that the

'public offering price.

from all of the factors that

statement.

group

Dept.

NEW YORK

STREET,

Telephone WHitehall 4-6551

S. 1760, a bill
$300,000,000,000
V
!

However, I feel I should men-1
clearly at the tion at the outset foat * the debt
limit
should not be- viewed apart
beginning
,oi

members jhas made it possible for their
partners, officers and employees to buy shares for their own
account and that in many cases such shares have sooner or
later been resold by them at prices higher than the "specified
selling

junk.

<or your

Obsolete Securities

;

wish to say so

777' It is, and has been,

when

once

check

our

obsolete

the

sees

and

revenues

plete accord duction in the economy; and as
With the pur¬ Secretary of the Treasury I am
pose
of
this here to tell you that it is the Ad¬
bill,
and- I ministration's .objective to do so.

buy,

brings

junk

to decrease the debt limit of the United States from

when

—once

further reduc-

Treasury's cash balance.

appearing here today to give

SINGS TWICE

impair needed
interfere with apportionment
investors. Reports debt was
so

above and expenditures below estimates, predicts

offering price specified

77.77;777:vvv ■■7

of the various types of bonds among
reduced $7 billion during March and

In its release .the Commission indicates that its staff

The POSTMAN ALWAYS

ground that it brings Congress and the Treasury into conference.

issues, the Se-^

new

Secretary .of the Treasury

are

To counteract inside allotments of

By HON. FRED M. VINSON*

wejl known. SEC study surplusage. Practices complained of are integrated in trade custom and .usage. Modification
by rule-making pow.er of administrative agency improper. Legal
medium is Congressional action
v
\

.groups

4,$. Y.

WHitehall 3-0272—Teletype NY 1-956

Private Wire

to Boston

Amer. Furniture
TITLE COMPANY

Parks Aircraft

Ray-0-Vac 7

CERB^ATES:^

Grinnell Corp,

Lawyers Mortgage Co.

STRAUSS BROS.
Members

Prudence Co.

Security

Broadway

Newburger, Loeb & Co.

II Members flew York Stock Exchange:
:

«•

.Dlgby 4-8640

Oeletype NY :l-832. 834

Dealers

New
>

Assn

Board of Trade Bldg.
.Harrison 20,7b
Teletype CO 12*

Dixect Wire Service

WHitehall 4-6330

Bj?U Teletype NY 1 -2033

■

'I '•

■

-•

;

^Capital Stock

'"'A '•)'

•

' •'

••.. --

Bought—Sold—Quoted
'.-'-Py*-.■.'

•«

....

York—rChicago—St. Loui*
Kansas City-—Los Angeles

;

■

s*•

.•

**■

•

Stromberg-Carlson
Prospectus upon request 'I

'7c'

•'

C. E. Unterberg & Co.

Established 1914 -

Trjfoity Flace, New Yox]k 6, N. Y.

Telephone:
BOwling Green 9-7400

■'•r-

Horr.RssE§IBssTER

CHICAGO 4

NEW YORK 4

•

Service, inc.

Conv. Preferred

N. Y. Title & Mtge. Co.

'.7 -7v7

.717.7
1

Lawyers Title & Guar. Cp.

140 Wall St., N.Y. 5

Flamingo Air Service, Inc.

■'

Bond & Mtge. Guar. Co.

Sales &

Members N. Y. Security Dealers Ass'n

Teletypes: - r
NY 1-375 & NY 1-2751

<6.1 Broadway,
Telephone
\

New York 6, N. Y.

BOwling

Green

Teletype NY 1-1666

9-3565

_»

r■

Ward & Co.

Air

Armstrong Rubber
Assoc. Dev. & Research
Automatic Instrument

problem,
to

charts,

most

Cinecolor

Part

(distinguished

show how the
deflation of v the
early thirties
might have
been
avoided
by
maintenance of equilibrium in the
economy, but in passing I would
like to call attention to the fact
that the worst economic debacle
of our history was not preceded

Prom

immediately : by

It will

Deep Rock Oil
Douglas Shoe*

eralv inflation
,.

General Machinery

-TS

Gt Amer. Industries*

Hartford-Empire Co.
Higgins, Inc.f
Kaiser-Frazert
Maxson Food Systemf
J' v

Michigan Chemical
Mohawk Rubber*

'^..-Moxie
National Fireproofing
Chicago R. I. & Pac.
Old Pfds.

Missouri Pac.
Old Pfd.

N.Y.NewHav.&Hart.
Old Pfd.

Syhrania Industrial
Taca Airways
■

■

U. S. Air Conditioning

;
:

Upson Corp. 51

■

t' if; Alabama

specific
inflation, e. g.,
John D. Gill
of real estate)
as a rapid upswing of the price
composite from the price compo¬
site trend.

MillstliSS

Aspinook Corp.*

| Textron Wrnts. & Pfd.

See Chart 1.

Note the

rapid rise from 1916 to 1920; also
from 1940 to 1942.

tervals

American Gas & Pow.
i
Cent States Elec., Com.5
Derby Gas
[ ■ Iowa Pub. Ser. Com.

disequilibria

history, repeats.

uncompensated

—■

sufficiently compensated ele¬

Inflation is here.

flation.

Prices

will

It may

recede

I think history

will repeat. I do not think of in¬
flation in this country as of the

ments of the economy.
The" up¬
swing from" 1897 to 1915 has not 1923 German type. That kind of
been generally considered infla¬ inflation is
possible here, but we
tionary despite an appreciable to¬ have never experienced it, and for
tal rise in prices, because:
present purposes I do not contem¬
First, the long interval during plate it. See again Chart 1.
which prices rose slowly afforded
If the current price inflation,
time for the making of adjust¬
which is differential in its effects

ments; and

Second, prices were.rising slow¬
ly toward the long-term trend
and not upwards away from it.
The "long-term trend" concept
is important. See Chart 2. Note
that the long-term trend of the
cost of living ("price") index is
Upward. The increase in the cost
Of living of a fixed standard over
a hundred years has been consid¬
erable.
Nevertheless, the trend
1

has not been considered
evidence of inflation. >: Chart

rise

shows clearly periods of inflation
and

the several economic classes
(e. g., wage earners, landlords,
annuitants, farmers, etc.) of our
people, does not recede, but rather
if prices remain on a plateau, pat4
terns of bqsiness competition will
upon

They will be

pd greatly- altered.

altered somewhat

tent

mined

anyhow, the

ex¬

the

change being deter¬
by the amplitude of the

inflation and the time which will
be required

for a return of the
price level to the long-term trend,
or
to some substantially lower-;
than-present level.

deflation-rrapid, wide up¬
It is the differential effects of
swings and downswings,
inflation with which we must be
p Inflation is a symptom. It is an
most concerned. If all were hurt
effect of other fundamental un¬
balance in the economy.
from >

existence

of terminated in

policies

conflict with

the
dislocations
the
There is more

National

ence

Industrial

Board March

(Continued

also be grievous

Confer¬

21, 1946.

on page

2244)

;

Norway has

ficance.

p e r s u a d e
other
coun¬
.

tries to elimi¬

bilateral

nate

agreements

sible without

much

United Public Util.
^Prospectus Upon Request

*Bvlletin

Circular

upon

products.

date

country

has heretofore had. Yet, even while

its

has

Philippine trade
trade

twenty-eight
we

bill

preferences

are

giving lip
that

embodying

for

the

while

years.

And

every

opportunity

service to the thesis

bigger. imports

goods and services
if we

the

passed

the out¬

side world's debts to us, under a

Congressional
port-Import
the

of American

use

carry away

goods

out

proceeds

of the

makes

such

able

our

their

Ex¬

requiring
bottoms

purchased here
of loans

foreign: fcouhtries.

in other words, in¬

cases,

stead of

the

mandate

Bank

making dollars avail¬

others

shipping

ping

services,

by the hiring

services,"

ican underwriters

bond issue of

$100,000,000 which will not have
such

restriction.

The

shipping restriction

port-Import. Bank

loans

Ex¬

arises

from Public Resolution 17 of the
73rd

Congress,4 which
all

exports

other

specifies

of agricultural

products fostered

loans made by any instrumentali¬

ty of the U. S. Government should
be carried exclusively

of'U.

in vessels

registry, unless sufficient

such tonnage is not available.
In

Britain, the "Economist" has

been

taking

the

Export-Import

Bank to task for its "tied" loans.

The Bank, apparently sensitive to
the

criticism,

took

the

unusual

step of sending the editors of the
"Economist"

explanation. This

prompted the publication to

re¬

vert to the subject and state in
part the following:
"In

short, what the Export-Im¬

port Bank is arguing is not that it
does not discriminate, but that its

(Continued

on page

2231)

are

The

COMMERCIAL

and

FINANCIAL CHRONICLE %
Reg. U. 8. Patent Office

where they

even

marine

point to

necessary

are

to collect

are

foreign

Newcastle. Therefore, as re¬
ported last week in the "Chroni¬
cle," the Norwegian Government
is discussing with private Amer¬

and

of overthrowing Empire

means

preference

sees

Congress is debating the Anglothat
American financial agreement as
a

merchant

and

own

paying interest on a loan to hire
high-cost American shipping serv¬
ices. This is just
carrying coals

liberal

import policy than this

have ships of their own.

William B. Dana Company
*

.'♦Avon Allied Products

Publishers

25 Park Place, New York 8

4440.0 Herbert D. Selbert,

■

EMtor and Publisher

^Princess

♦fubticker Industries

^Simplicity Pattern

Shops

^Electronic

fLe Roi Company

Corp,

3 *District Theatres Corp.

William D. Riggs, Business Manager

Thursday, April 25, 1946

Prospectus and Special Letter Available

tStatistical Study

Special Letter

Published

Request

"*Prospectus

request

twice

Members

Association

York Security Dealers

New

Teletyve NY 1-242S

Tel. HAnover 2-8080

and every

Monday

New York 5, N. Y.

Wall Street

week

Thursday

(general news and advertising Issue)

J.K.Riee,Jr.&Co.
■,

every

FIRST COLONY CORPORATION

^ 444

William Dana Seibert, President 4

Great American Industries
*

Standard Gas Elec.
~

REctor 2-9570 to 9573

American

passing signi¬

Spec. Part.

purpose; Norway has not availed itself of
may be of the credit because of the. abovemore th an mentioned
shipping
condition.

Southeastern Corp.
\

opening

this

[ New England P. S. Com.
|. v Puget iS'nd P. & L. Com.

the

$50,000,000 credit for the purchase
of

doing the exact opposite: requir¬
*A panel talk by Mr. Gill before ing foreigners to hire our ship¬

Its harm

which it creates.

can

July, 1945 negotiations be¬
international tween the Export-Import Bank
trade that the: and the Norwegian Government

inflation,

To my mind there is no argu¬
we now have in¬

increase,

But deflation

eral system of

the up-movement left in its wake

arises

WASHINGTON, D. C., April 24.—The United States Government
has been making such strenuous efforts to bring about a restoration
of a multilat-^
—

rather, in the several years
and trade pre¬
Herbert M. Bratter
before 1930, by gradual price re¬
ferences
this
cession,
The latter .period was
notable otherwise for its growing country is making and pledging
economic
disequilibria,
as
is billions of dollars, the ultimate re¬
shown in Chart 4.
payment of which will not be pos¬
ment whether

ado about' inflation than deflation.

]

by Export-Import Bank be used to purchase American goods
shipped in American bottoms.
-

but

The time in¬

were

price

loans

space

short; the upswings
considerable and grievous because

not

Conv. Pfd.

serve

present

0 ur

purpose to
think of gen--

Frontier Industries

have

for

themselves.

Dayton Malleable Iron*

international trade.

ing creative action.
J
Chart 3 shows price deflation in
the early thirties and its relation
to the national income. I do not

efforts of Government to bring about multilateral systems of
Cites also the Congressional Act requiring that

uous
;

pessimistic psychology inhibit¬

and

present

speak

which for the

S. F. Bowser

By HERBERT M. BRATTER

Washington observer notes inconsistency in the Philippine trade
bill, which provides for bilateral trade preferences, and the stren¬

(

pat investment or speculative procedure for hedging
against inflation. I expressed willingness to talk to you on some ele¬
mentary con- "
^
in its
effects, sometimes more,
cepts of the
i n f1 ation
grievous, because deflation begets
I have

few

Bird &, Son

Although denying existence of effective investment hedge against
inflation, Mr. Gill declares we must be concerned with its differen¬
tial effects. Predicts current inflation will be followed by price re- 'I
cessions, and that rentier class will experience only temporaryv
effects 'from the cycle.
Concludes that most kinds of income be¬
come insufficient over a span of years, the best hedge being a place
on payroll of a non-cyclical business.
" v

Cargo Transporlt

iC;

111

Director, The Atlantic Refining: Co.

American Bantam Car

•

/V;..' ; r.

By JOHN D. GILL*

>•

jr,»p it

-Thursday; April 25,41946

Hedging Against Inflation

£$T. 1926

2^4 '4)•:»;

■ftvt";V;:i;• i-Jv • **matfsvi',tH'F,'

THE COMMERCIAL & FINANCIAL CHRONICLE

2216

Established 1008

»■

Members N. Y. Security Dealers Assn.
REctor 2-4500—120 Broadway
Bell System

(complete statistical issue—market quo¬
tation

records,
corporation,
banking,
clearings, state and city news, etc.)

Teletype N. Y. 1-714

request)

Other

Offices:

Chicago- 3,
1

111.

135

-(Telephone:

Salle

State

St.,
0613);

Drapers'^Gardens, London, E. O., Eng<
Copyright 1946 by William B. Dana

GALVIN MANUFACTURING CO.
(Makers of Motorola Radios)
.

Upson Company

EST., 1926

*Doyle Mfg. Com. & Pfd.

Kendall Co.

Tennessee Prod.

120 BROADWAY. N. Y. 5
N. Y.

Circulars

""Prospectus

■

ENTERPRISE PHONES
Buff. 6024

request

as ^ecohdnclass matter Feb#
25, 1942, ut the'pdst office at New
N. Y., under the Act of March

1879.<

Subscriptionsf in United States and
jgsefisions, $26.00 per year; in Dominion
of
Canada, $27.50 per year; South and
Central
America, Spain, Mexico, and
_

Circular

request

Cuba,

■;..

$29.50

per

year;.

Great

Britain,

Continental Europe (except Spain), Asia,
and Africa, $31.00 per year.

Australia

Seligman, Lubetkin & Co.
Incorporated

Bos. 2100

fork,

Engineering

request

1-1287-1288

Direct Wires to Chicago and Phila.

Ilartf'd Bill

Wellman

Descriptive

REctor 2-8700

[uary

■I'* J

Shatterproof Glass

Members N.Y. Security Dealers Assn.

Reentered

Members New

Broad

York Security Dealers Association

Street, New York 4

HAnover 2-2100

Poll's, Dowling & Co.
Members

Nets

York Curb

Exchange

25 Broad St., New York 4

HAnover 2-6286

Bank and

Otber Publications

Qpotation'Record—Mth.$25 yf.

Monthly Eartimgs Record—Mth.::. $25 yr»
NOTE—On accouhi of the fluctuations
in the rate of

exchange*«*emlttaaces fb*

foreign subscriptions and advertisements
must be made to New York funds.

too

Kingston Prod. Stock
Offered by Alison & Co
*

An issue

148,448

shares fijbf

stock

(par $1) of Kings¬
Corp; was publicly
offered April 17 by Alison & Co.,
Detroit.
The stock was priced at
common

ton

Products

$8.50 per share.

•

,%t

CANADIAN

SECURITIES

Bank of Montreal

Bank of Nova Scotia
Bank of Toronto
granted by the laws of the various

Canadian Bank of Commerce

states.,'.;
Every few days my department
applications to
permit
sale of securities exempted
under our laws.
Many of these
applications come from Eastern

Dominion Bank

receives
the

States.

view of

these

circum¬

stances, I will attempt to state the
exemptions under the Oregon law,
with

comment

some

the

any

territory

any
or

insular
by the

••j District of Columbia

or by any
! state or political subdivision or
'V agency thereof.
•'
■
'

(b) Any

security vissued or
f guaranteed by any foreign gov% ernment with which the United
i

Bulolo Gold

Dredging

Canadian Western Lumber
Electrolux

Famous Players Canadian Corp.
International Utilities
Jack Waite

(Continued

on page

2257)

Mining

Minnesota & Ontario

Paper Co.

Noranda Mines

Pend Oreille Mines

States is at the time of the sale

Company Com. & Pfd.

Canadian Pacific Rwy.

possession' thereof

Atlas Steel

Brown

•

(a) Any security issued or
■i guaranteed by the United States
!

Andian National Corp.

Assoc. Tel. & Tel. $6 & 7% Pfd.

ex¬

emptions granted by other states.
The Oregon act does not apply to
any of the following classes of se¬
curities:

Imperial Bank of Canada
Royal Bank of Canada

Sherritt Gordon Mines

Steep Rock Iron Mines
Sun Life Assurance
'

Direct Private Wire Service

COAST-TO
New York ^Chicago

•

St Louis

COAST

Teck Hughes Mines

Kansas City

52 WILLIAM ST.,

Los Angeles

Bell

New York

N. Y. 5

HAnover 2-0990

Teletype NY 1-395
Montreal

•'

Toronto

STRAUSS BROS.
Members New York Security Dealers Ass'n
32

Broadway

Board of Trade BIdg,

NEW YORK 4

**BOWSER, INC.

CHICAGO 4

DIgby 4-8640
Teletype NY 1-832-834

Harrison
.

White & Company
;
ST. LOUIS

Teletype

2075

*L. E. CARPENTER

129

Baiinif Bernheimer

Co,

*GLOBE UNION

KANSAS CITY

**INTERNATION'L

Pledger s Company, Inc.

vfgj

DETROLA

LOS ANGELES

*PUBLICKER

INDUSTRIES

Bought—Sold—Quoted
Harvill Corp.

Southern Airlines, Inc.
('f

>•;vI

•'

Vs»V:

*
,

Hood Chemical Co., Inc

Jeff. Lake Sulphur Com. & Pfd.

Chicago and
$?

n|i

Lane

Cotton Mills Corp.

Continental

**Circular

Request

Common Stock

Hold Hold Co.

V« 'j

Prospectus

Rademaker Chemical

Airlines, Inc.

Bought

Stand. Fruit & S/S Com. & Pfd,

—

Sold

—

Quoted

United Piece Dye Works

All American Aviation

United Stove

BURNHAM & COMPANY
members New York Stock
Exchange ' v
associate members N.Y. Curb

Exchange

15 Broad Street, New York
5, N. Y.
telephone: HAnover 2-6388

ESTABLISHED

T. I. FEIBLEMAN & CO.
Members New Orleans Stock
Exchange
New York 4, N. Y.
41 Broad St.
Bo. 9-4432

New Orleans 12, La.
Carondelet Bldg.

74
:

Telephone:

Rauiang ')■
J

Getchell Mines
United Pjablic Utility

Common

Old

ACTIVE MARKETS,

Colony Railroad, Common

Chicago, Rock Island & Pacific, old
V;

Missouri Pacific, old

common

com.

& pfd.

and preferred

Francisco, old

common

United Piece Dye

Soya Corp.'

New York, New Haven & Hartford, old common and pfd.
St. Louis & San

American insulator
&

Teletypes:?
NY 1-375 & NY 1-2751

Bell Tel.—NY-1-493

Common

Preferred

Carbon Monoxide

Eliminator

••

BOwling Green 9-7400

Baker

1914

Trinity Place, New York 6, N. Y.

Di-Noc

Co.

and preferred
Great American

Bought—Sold—Quoted

Industries

American Beverage
Preferred

PETER BARKEN
: 32 Broadway, New York 4, N. Y.
Tel. WHitehail 4-6430

Tele. NY 1-2S

Established 1888
64 Wall St., New York 5
MEMBERS N. Y. SECURITY DEALERS

Phone HAnover. 2-7872 Tele. NY 1-621

Wall Street, New York 5r N. Y.

39 Broadway, N.Y. 6"

ASSOCIATION

DIgby 4-2370

Teletype NY 1-1942
Bell Teletype NY

1-897

I17V*

'^M.' r'^'-i.4

*■

\ •Lrf..V-:\>^'';"■*'.t^sjs.Vl^'l* y»,9>

ov'-i.e

■A:

THE

2218

COMMERCIAL & FINANCIAL CHRONICLE

Politics and Steel in Britain

prising

that

divided

the

remarkable

merely be
brought under

by this. AAA. !4fv
Prior to the decision it was un¬

well-informed

derstood in usually

that the Government
nationalize the twenty
public control
largest
combines
whichy between
or
should be
brought under themselves, control about 90% of
the total capacity of the industry;
public owner¬
and that only the works produc¬
ship,
nobody
could reason- ing raw materials up to the ingot

Einzig

*•

By the EARL

This

and

speeding

back
i that other

goes

oc¬

than

ago,

when

you

welcomed
t

t h

u s

:thought
glad as

e s

iany
r,;:v

A?"

Bought

'A\

Sold

—

was

Halifax

and I was

from

country

can

of Britain

how

but

when
"we would
and

come,
it-more hard to say;

conscious; in that great

company of friends whom I met
in this place on March 25, 1941,

that if they shared our faith they

over.

uncertainty.

Thermatomic Carbon Co.

—

20.50

—

10.00

1939

—•

18.00'

-V

' V-4

vA.WA A A. ;-A

1940

$20.00
25.00

Yield

$16.00
16.00

April 22, 1946.
(Continued on page 2230)

]

;

Lord Keynes Is Dead

The unexpected death on
21 of John Maynard Lord

April

Keynes,>

British economist, brought expres¬

sions of regret particularly in

country,*1

this:
'v

•

11 y

so r e c e n

figured in the
of

discussions
the

Interna-*

tional

Mone¬

Confer-

tary

ence

Sa¬

vannah,

Lord Keynes
in

life, said;

ated Press ad-

vicesfrom

Washington on
April 21, was

;

of $16

ore

per

and5

shocked"

"deeply

was

arikitm

associated with the British econo--r
T (Continued: on page

7]/%%

2261)

request

r-,:<

Richmond1 Cedar Works

Dean WitTer
'y>yv*•. -!V

V'-ry*
•

NEW YORK STOCK EXCHANGE

14 WALL
...

Co.
&

HokRsseSTrqsier

-MEMBERS
>:;'A SAN FRANCISCO STOCK EXCHANGE

;.:A-!,

HONOLULU STOCK EXCHANGE

STREET, NEW YORK

LOS

SAN FRANCISCO

HONOLULU

ANGELES

«v,i '

•

COMMON STOCK

No Preferred

' - A

Producers of :ASouthern

Comfort"

30,737

62/100 shares out
Book $50-$60

whiskies & spirits

Bought—Sold—Quoted

Market between $25-$30

•

Circular ' C-l

request

27 Slate

Broadway, N. Y. 4

Nathan Straus-Duparquet

Claybaugh 8i Co.

Members Philadelphia StockExchange

Brokers

Preferred

Convertible

Blair F.

72 WALL ST.,

WHITEHALL 3-0550

MAHER& HULSEBOSCH
,

George A. Rogers & Co., Inc.
1

Montgomery St.? Jersey City,> N.
42

Harrisburg-PittsbuVgh-Syracuse-Miami Beach

Broadway, New York, N. Y.

Securities

...Branch

113

Hudson

8950

Tele. BS 169

1926

New York 5, N. Y.

Telephone":

Teletype

WHitehall 4-2422

tjtfB
Established

Dealers

investment

62 William St. J
,

NEW YORK 5, N.Y.
!
Tele. NY 1-2178

Tele. NY

St., Boston 9

Tel. Capitol

Tel. DIgby 4-1388 -4

Hotel

Rhodes

H. D. KNOX & 00.

PRICE $28.50 PER-SHARE

Latest Dividend, 50 cents) paid March 1, 1946,,

Products

Co., Ltd.

Earned about $7.30 share

••

-M',,

American Felt Co.

Westerti Liiihber

A,.,

Nazareth Cement

Canadian

Standard Gas Equipment
''Common

Washington* Properties
Commodore

MERCHANTS DISTILLING
No Bonds

~i :

American Vitrified

Teletypes:
NY 1-375 & NY 1-2751

Victoria Gypsum

Trinity Place, New York 6r N. Y.

telephone:
HOwlirig Green 9-7400

„

Tennessee Products
^,4/;

ESTABLISHED 1914

LOS ANGELES STOCK EXCHANGE

Telephone.BArclay 7-4300,

NY
Office

1-2613
r

St., Jersey City, N.
•

Philippine Mining Stocks
A
•'

1' •

•:

*>y;

•

-tj^vP

A-

7
t.
•

Linn Coach &
Truck Corp.

SEMINOLE OIL & GAS CORP.
A

Producing Company

v
■

PROSPECTUS

REQUEST

F. H. KOLLER & CO.,

f|K

111

Inc.

—

Sold

—

Quoted

R. C. ILSLEY & CO.

Const

Mines

{ V Big Wedge Gold
information

and

Furnished

Request

john j. o'kane jr. & co
Established

1922

Member of National Association
of Securities

NY 1-1026

Quotations

Dealers Ass'n

BROADWAY, NEW YORK 6, N. Y.

BArclay 7-0570

Balatoc Mining

Benguet

Mindanao Mother Lode

Common Stock

Bought

Members N. Y. Security

•

where he had

Lord fCeynes* stature."
| j|
A Harry White, Assistant Secre-* /
tar/, expressed similar sentiments, ;
as did Will Clayton, Assistant Sec- ^
retary of State. Both had been

$4.60

—-

oYeir

Circular

Direct Private Wires

—

1943—

1942

•

1945 —16.00

•••«*,«-V-'-

*An address by the Earl of Hal¬
before the Pilgrims of the'
United States,
New York City,f

*v
"
^In these chaotic days the worldcan
ill afford to, Jose a. man of

1944 —r 16.00*

1946 to dfate

ifax

add'edi

1941

at current rate

RECORD

DIVIDEND

$12.50

1937
1938

HAWAIIAN SECURITIES
A'

/./V

at Arinapolis,
being welcomed, as you will re¬
member, by the late President
Roosevelt, in a gesture both gen-k
landed

Secretary of the Treasury Vin¬
son led' off with the comment that :

PACIFIC COAST

•

speech,

1936

won't be back¬

Yices added:

COapiON
STOCK I;
'.k .'fc•

»A.

;

*•',-•■

quitter."

New York 4, N. Y.
WHitehall 3-4490

•

A few weeks after he made thut

conie through;

; :v!''iv''

ing

figure of
Lord Keynes
Battered and bruised,
To recapture the mood of- those controversy in
wounded days we may recall the last words America wherever the subject of
indeed, but with the will to fight of my predecessor, Lord Lothian, Government deficit spending came
unbroken. The might of Germany, in the speech delivered for him as up, but his death evoked
offi-;,
cial tribute to him as an econo-;
though was- still unsapped; her he lay dying on Dec. 11, 1940:
planes wete still bombing our ; "I have done," he said. v"f have mist-statesman whom the world
cities; her armies were still poised endeavored" to give you-some idea heeded in these- times, These ad-

!just

also shared our

was

'£■:+1'M

found

have

undertake. That
doubly true in the' early days

iwd. had

Quoted

Teletype NY l-960!

;.'r- v.•*•*'.'A

they did

would

victory
Lord

of 1941. The Battle

A ;

V.v'V'AV-

HARDY & HARDY
11 Broadway,

'OvV.'VVVi-''^

win;

would

!be called upon to

;

V '■■■■

wrong/

unbridged 'gap between escaping
defeat and achieving victory.
In
Britain we had never doubted we

;mas t

man

our cause was lost; and
they ^pon were to have

not know
that they were wrong then.
And
for us all there was a wide and
been

1 mportant
: missions
that

;

friends in this country had

our

shores. I stood

honorable and

s'f

possible invasion; the Swas¬
still floated over the greater

part of Europe; and, save for one
small country, Greece, we stood
alone. A few months earlier many

tika

five

«years

jof rthfe

vi a

If you back u$ you

of greeting a coming
parting British Ambassador; and in gratitude my mind
for

brought under | then, as a pil¬
public ownership. There was noth¬ grim among
that the views of those favoring
ing in the text of the official 'Pilgrims, on
outright
nationalization
would statement, or in the answers given the threshold
of what must
eventually prevail. What was sur(Continued on page 2232)
1 always be one

casion, more

Superior Tool & Die Co.

•

great" Society has a kindly tradition

quarters

would

OlF HALIFAX*

icalling attention id VaAi^ nf British-American
D^liyfea^5^
tion, Lord Halifax points to need of a similar method of cooperation between the two Powers to maintain peace.
Holds that had
peacetime cooperation' been in effect during thirties, European war <
mighf have been averted. Pledges loyalty to UN, ''the rock upon
v/hicb our house of peace is built/' and concludes that so long as
'present pattern of Anglo-American relations exists, we need have no
fear of minor differences, and tha^ the two nations should continue
-id do'together what neither can do sepaTafefy.

would only

stage

ablydoubt

hopes and what support you
realizing them. We
are, I believe, doing.all we can. J..

Brifish Ambassador tfo the United: States

1" '

meant

in¬

should

dustry

the

was

declared that
measure"
of nationalization, and refused to
indicate
in • any way what he

question whe¬

Paul

;

there would be "a large

the

Anglo-American

Minister of Supply,

the Cab¬

inet is sharply

ther

%'t;

v1;

vagueness of the terms qf the an¬
nouncement.Mr. Wiim'ot> the

known

been

present position and dan-problems of 1941 and our
hopes for the future.
It is for *
you to decide whether you share
our

will give us in

surprise.^

For,
even
though it had

o,r*,i,i'\ '»i^ *>* f» tf.T* /»',w*''--v

our

indicating or presenting a plait,
Mr. tinzig points out that this action was taken tffir political move
to satisfy the ruling element in the Labor Party and for frustrate move of its merger with Communists.
Sees harm done: to steel
industry because of uncertainty. :
LONDON ENG—The Government's announcement • on April 17
of its decision'to nationalize the iron and steel industry did not come
^

JJA i'

gers, the

announcement of intention to

Noting the British Government's
nationalize steel industry Without

o'WJUM V*<**r

Thursday, April 25,' 1946

'Mv'"' '/„

Factors in

,»u

Dealers, Inc.

Wall Street,

N«w York 5

HAnover 2-1140

Members N. Y. Security

Dealers Ass'n

42 Broadway, New
DIgby 4-632(1

York

Teletype NY 1-1525

♦Volume

163

Number 4484

THE COMMERCIAL & FINANCIAL CHRONICLE

The Problems of Tax Revision

Export-Import Bank

By ROY BLOUGH*

Closes Subscription

Director of Tax Research, U. S. Treasury

Dr.

Blougb, maintaining that time has

not arrived for

For Dutch Credit

revision of

•;

changes now under consideration: y(l) corporation taxes;
J
(2) applying "averaging'' principle in taxing income; (3) capital
^ gains and losses; (4) income tax rates and exemptions; and
1
(5) treatment of family incomes. Concludes tax problems ahead T
i- have serious
bearing on future economy and that tax controversy vshould be withdrawn from narrow self-interest and group pressure.
<.
*

The year 1946 may well turn out to be a quiet year with respect
to tax legislation. .This is not a forecast.;. The unexpected happens
too
often
in/vV

taxation to

large the changes made in the tax

permit fore¬

laws

casts/! It. is
only

into

sition

quiet

tax

The tax

problems > of
"tr

a n.s

ition

prompt¬

Were

ly attacked in
RoyBiougb ;
,the Tax/Adjustment Act of 1945 and the Rev¬
.

Act

enue

The

1945.

former

made

currently available for the
period postwar tax
benefits whcih had been provided
reconversion

in .wartime

revenue

/We

profits

and

•,*;•

the

tax,

reduced

capital

r. As the prospects of
achieving a
balanced budget approaches, with
the possibility of having a

budjget-

ary surplus," there are some de¬
mands for further tax reduction.

*An address by Dr. Blough be¬
fore

the Eastern

Spring Confer¬

ence/Controllers

Institute
of
America,' New York City, April
15, 1946.
(Continued on page-2246)
By and
use

nopoly, and their effects lead to increased prices, restricted output,
reduction of employment, and protection of inefficient producers.
Urges alertness to prevent the "sabotage of a free economy" by

accepted
April 24..

Since'the

agreement for

cartels and other monopolistic trends.

$200,000,-

It is only a few short months

300 2-year Ex¬

port

Credit

the

hammer blow in the

Import

Bank

short span, for

not' yet

all

are

Wm. McC. Martin, Jr.

of human ex-,

Prom the rate at which they have

istence./"It "is

been

coming in, it appears
about half the. credit will be

that
sup¬

which,

the

Federal

Reserve

of
\

brilliant

the
Wendell Berge

imme¬

know

more"

also

that

there

are

force

the

work

peace

and of progress for the American

surely, when World
War II ended, a new age began.
The challenge of this new
era
with"all of "its complex problems
is " inescapable.. It
is inevitable
thatmapy of our familiar notions
will be altered, and that much of
our knowledge will be recast. We

made the Information available to

the Export-Import Bank.

American

industry

rapid

Even"

meetings, commercial banks have
been apprised of the main fea¬
tures of the credit through the 12
Federal Reserve banks, who have
the request

the^ United

power

The record

full

years

Banks in New York "and Chicago
this
month. v Apart
from these

member banks at

ended.

the

commercial banks at the

a ;

pace

Chairman, Mr. William McChesney Martin, has held with in¬
terested

States.

continue

re-

Bank's

offices

people" is

the

task before
of

central

industry is

economic

The reconversion

us.

now

process.

respects it is an interim pe¬
expedients - and ' adjust-?,
ments to immediate situations.
In

some

riod

other respects, however, reconvert
sion is a major first step toward

issues

touching every phase of society so those long-run goals which are
of primary importance in our eco¬
grave that unless we master them
houncement on the Dutch credit is they will master us.
Seldom has nomic development. ;... J
■
expected to be made by the Ex¬ any generation carried a greater
The Policies of Management
>
port-Import Bank in, Washington. responsibility to itself and to. the
It is at this juncture that thri
future/ to use the ; best of its
P" fe/ V/ ■
-a^M thought and its utmost endeavor functions of
management
in
Rejoins Thbriison v
!
| to establish a peaceful and prot American industry. emerge as a
paramount factor in the course
jiuctive world.
which our economic affairs will
f
A(Spe<ial tO THB financial Chronicle)
;
Tn accepting the responsibilities
pursue. ! It becomes necessary to
and meeting the challenge of
V
CHICAGO,
ILL.—Richard
R.
inquire what those functions are,
new era,-this nation in particular
Cooley has rejoined the staff of
what principles underlie their opThomson^ & McKinnon, 231 South jhas -a. critical role and enjoys a
On the eco¬
•La Salle Street, after serving iii unique opportunity.
; *An address by Mr, Berge be¬
nomic level, especially, the degree
the U. Si Army.
;
•<■■■:■
fore Washington Chapter of So¬
of our success in attaining pros¬
!
r
'
—
;
;; ,
ciety- for .the
Advancement of
perity will' exert an • immense - in¬
Management, Washington, D. C*
fluence on the shape of the future.
With Fewel & Co.
It is crucial for us to "think and to April 18, 1946.
1

fey the end of this "week ari hn^

Compromise Silver Bill

Treasury baying price expected to be fixed between; 90 jcents and /j
$1.00 per ounce, and nationalization of newly mined silver
•.discontinued.

■

WASHINGTON, April 24.—Silver interests on Capitol Hill exjiect; that, barring some; unforeseen f hitch, a compromise between
mining; and

interests*-

consuming

will be reached within a few days.

supply silver to American indus¬
consumers at corresponding
palavers and the prices.
compromise may assume an omni¬ \ (3) Instructing the OPA to re¬
Other interests also are concerned

the

bus nature.
The
look

compromise

present

centers

around

out¬

amend¬

ment to the Silver rider the house

•attached

the

Treasury appro¬
priation bill.
The amendment is
being - offered by Senator Carl
Hayden of Arizona, a silver-min¬
ing state.
While there has been
no publicity on the nature or,even
existence of the Hayden amend¬
ment

trial

current

move

all ceilings on silver bullion

and manufacturers of silver.

(4). Repealing sections .6, 7 and
8 of the Silver Purchase Act of
1934-rrthe sections relating Jo the
Nationalization of Silver and the

;

(Special to Tins Financial

Chronicle)

LOS ANGELES, CALIF.—Cecil

act in the light of a

...

ha§, j oined the staff, of
Fcwel & Co., 453 South Spring
special silver transactions tax. c ■/ Street*! He! was. formerly with
The » last
mentioned
feature, Merrill /Lynch; Pierce/; Fenner &
(Continued on page- 2259).
Beane and E. F. Hutton & Co.
.

now

indicated

I/C. T..A.. /

•Pratt's Fresh Frozen Foods*

Regal Shoe*

Ltd.*;

Welcomes

SONY'S

you to

ye4rly. spree*

Standard Milling*.

Giddings & Lewis

Standard Stoker

Hang
And

your

save

hat in

our

the two bit he*

vv'.u! Cw

e'e'

UJ1 I1

& bankers only

..^.1

G. A. Saxton &
\

Tenn. Gas & Transmission*

Sons*

Prospectus available to dealers

flat

V,';

•

Co., Inc.

New York 5, N. Y.

70 Pine Street,

Suburban Propane Gas*

M. Lowenstein &
*

and thereafter to be fixed
!at $1.29, •
;
1
K
(2) Authorizing the Treasury to

Manufacturing

Dictaphone

limited period of say one or two
years:

/Rockwell

Bowser/ Inc.

Grinnell

the

of 90 cents to,$l\00 for a

range

Marmon-Herrington
National Mallinson Fabrics*

within

2248)

on page

Anchorage Homes*

Anderson-Prichard Oil

:but

(Continued

American ta? France

Arnold Brilharti

(1) Raising the Treasury's buy¬
ing price for newly-mined domes¬
tic silver to a figure yet to be
agreed upon by the opposing sides

TRADING MARKETS IN

VJ;

clear under¬

J. Downs

it is believed to aim at the

following:

'
•

■

pr t|nifed StatesGovernment *
f

State

arid

;

•

Railroad, Industrial;. j
Public Utility
BONDS
Investment

ExpressoAeree

OUR

Kinney Coastal Oil

Stocks
■y.

R.W.Pressprich&Co.

'■

*:•.

■

:
_

,/v

}

Knowledge
/ •
:
,

♦
...

201 Devonshire St.
-

Boston 10

Experience •
for Investors

Facilities

EXCHANGES
TRADED

•-O.

* Circular

/-!
on

OR THE

r V Circular on

request

JAMES M. TQOLAN & CO.
Telephone

HAnover

2-9335

Teletype NY 1-2630

NOW

request :

New

25 Broad

York

Curb

Exchange

St., New York 4

HAnover

2-6286

THERE ARE 219

THESE EXCHANGES THAT

ARE

ALSO

YOR^^TOCK EXCHANGE

NEW YORK

CURB EXCHANGE.
UPON REQUEST

PuBis, Bowling & Go.
Members

TRADED ON PACIFIC

AVAILABLE.

A COPY WILL BE MAILED

,67 Wall Street, New York 5

TRADED ON THE NEW

,'3
•

Members Neu> York Stock Exchange

New York 5

ISSUES

7\,

Truck Co., Inc.

Utah Southern Oil.

ifV-

68WiIliamSt.

Telrtyp. NY 1-609

REVISED DIRECTORY OF STOCKS

; COAST

Sterling Motor

Equity Oil

/„

ill:

'•/

WHitehall 4-4970

Municipal,

i./j-.S
:

:V.

diately ahead. <
~
'•
When World War, II began, an age

conferences

dominant

during the war was a
accomplishment and a
lasting tribute ' to the ability of
management, the skill of labor
and
the ingenuity of American
scientists and engineers. To main¬
tain this power and to apply its

will

plied by the Export-Import Bank
commercial banks. J
Subscriptions have been the

industrial

evident

s o

that transition

and half' by

certain

are

facts, certain fundamental princi-j
pies and'certain specific objec-!
fives which govern the decisions;
We shall be required to make. The
cardinal economic fact w.hich our
war experience emphasized is the

matiori in

o t

been limited to commercial banks.

There

th-» conditions

economic, life for this country,

major trans-

involved in
expanding

of what is

the achievement of

has .witnessed

nec¬

essarily tenta¬
tive. Subscrip¬
tions^" .ha.v.e

suit

standing

that the world

/subscrip¬

tions

<3>-

realize

signed,

since the United Nations struck a
by defeating Germany and

liberty

this

even

has

been /

cause

Japan. Yet it
is possible,

Dutch

Government

and

personal

corporatte income taxes.

still very much in the

are

The

acts.

jstock tax, and the automobile
.tax,

hpt looked

period of;fransition. - Goyerpment
expenditures are declining more
rapidly than was expected but are
still a long way/above the prob¬
able postwar" ley el,'
Inflationary
pressures are very strong and the
problems of holding the price line
and maintaining a stabilized econ¬
omy continue to-be serious.
; *V;

Revenue Act of 1943 repealed the
excess

were,

.not

surprising that
this should be,
year.

period and

upon * as accomplishing * postwa^
tax revision.

to date.
i

ex¬

pansion
of peacetime business.
They were measures for the tran¬

the

/future .on the
basis of events
*

promote reconversion and the

projec¬

tion

designed

were

monopoly tends to impair managerial function, thus destroying
individual initiative as well as discouraging technological improve¬
ment. Says cartels are most recent and most powerful form of mo¬

subscriptions to the im¬
pending Dutch

the

out

credit will not
e

Assistant Attorney-General

Head of Anti-Trust Division of Administration stresses importance
of management in promoting efficiency and economy, and points

tentative

after

WENDELL BERGE*

■;-///"

WASHINGTON, April 24. —At
Export-Import ■ Bank
it
is
learned by the, "Chronicle" that

the

Managerial Function

the

tax

1945.

List
'

Expected- half credit will be
Supplied by commercial banks

structure, points out that economic objectives of a new tax
policy should be (1) combating inflationary pressures, and (2) removing restrictions that reduce production and employment. Cites
difficulties in tax administration that limit tax reforms, and lists as,

Effect of Cartels

tax

.v;

2219

IIKaiser & Co. J
MEMBERS
BAN

NEW

YDRK

FRANCISCO

2 □ PINE STREET

NEW YDRK 5

STOCK

EXCHANGE

RUSS

BAN

•

NEWYORK CURB EXCHANBt

LOB ANGELES

BUILDING

FRANCISCO A

STOCK EXCHANGE

PAULSEN

BUILDING

SPOKANE

2220

THE COMMERCIAL & FINANCIAL CHRONICLE

/Hi**

Joins O'Brien in Chicago
(Special to The Financial

Sees

Prospect of International
Monetary Stabilization

Chronicle)

CHICAGO, ILL.—Frederick N.
Shannon

has

become

connected

With John J.

O'Brien & Co., 209
South La Salle Street. In the past
he was with David. A. Noyes &

'Co.

Federal Reserve Bulletin takes optimistic view of
working of World
Fund and Bank. Holds International Bank will be able to prevent

■

sudden switches in international investment and that

On Staff of D. B. Peck
•(Special

The

ILL.
has .joined

Stanley

the future."

Oliver
the staff

S.
of

—

D. B. Peck &

Co., Ill West Mon¬
roe Street.
He was formerly with
Philip
D.
Stokes
and
Stokes,
Woolf

Co.

establishment

the

the Bretton€>-

Institutions.

Woods

Though

the

material is largely descriptive and
deals with the structure and pro¬
Fund

national

and

the

Bank,

Inter¬

concluding

of the two institutions. Re¬

success

Drug?':'b>;;b^

Emerson

Common

garding

this

;

Noxzema Chemical

article

the

International

"the

Fund

Monetary

Monumental Radio

topic,

that

states:

Monumental*
Life Insurance

and

Inter¬

the

CALVERT

ST., BALTIMORE
Teletype BA 898

Bell

———-—

tribute substantially to the main¬
of

tenance

orderly

exchange

relationships

and to a balanced
growth of world trade. The Bank
will

the

influence

direction

and

terms of international investment
with

use

view to
the

assuring productive
borowed

funds

and

reasonable

prospects of repayment
and to avoiding sudden changes in

the

flow

international

in¬

The Fund will

and Development

maintain

reasonable

roles

exchange rates while making pos¬
sible
orderly changes in rates
when necesary to correct funda¬
mental maladjustments, and will
help" to eliminate harmful ex¬
change
restrictions
on
current
transactions. In addition, the re¬
sources
of the, Fund will help

have important
in the immediate

play

period, but both are
primarily agencies for permanent
international monetary coopera¬
tion.

They

yicmbers New York & Baltimore Stock

New York Telephone Rector

———

vestment.

expected to

are

con-

|Bxohanges and other leading exchanges
6

—

national Bank for Reconstruction

transition

stein bros. & boyce

April published by the Board
leading article on

of Governors of the Federal Reserve System has a

portion deals with the prospects of

The Federal Reserve Bulletin'for

national

Bayway Terminal

posed operations of both the Inter¬

BALTIMORE

;

"probably

The New North American Company Plan
North

important country will permit large disturbing capital movements in

Chronicle)

Financial

CHICAGO,

DES MOINES

2-3327

help to
stability of

temporary over(Continued on page 2232) ■

WHEELOCK & CUMMINS
BOSTON

INCORPORATED

Dwight Mfg. Co.

Preferred

stock

Merchants

b-bv'.'

to be used to retire North Ameri¬

debt

The

Preferred

Company manufactures

cotton

tion

became obsolete, pre¬
sumably because the commission
saw no good reason >for setting ui>
regional holding companies—since
these would be only a temporary
device to lodge eventual owner¬
ship of the operating companies'

DES

narrow

Phone 4-7159

ings, twills and chafers; also various
fabrics for industrial purposes used in
automobile tires and for abrasives,
and pyroxylin-coated fabrics. Normally

Memos

American

Los

Bell Tele. DM 184

In other words the plan was

ers.

probably "unduly complicated."
The new plan uses a somewhat

A dividend of 50c per share was
ordered by the directors payable May

1946

stockholders

would receive (for each share)

transferable

chase v of

share.

Price

-'/♦"

>.V• ..<■'

•

•:

•

V,-.

'• '/•

MILK

BOSTON

Dealer Inquiries

pany

between

the

common

stocks

Union

new

Com¬

Delaware

which would take over the

remaining (non-utility) assets.
The

Invited,

purchase price of the "Di¬

one-fifth of

;

Steel

Central Iron &

com.

luminating
of

Botany Worsted Mills pfd. & A
Reportt

furnished

request

;

Buhl Bldg., Detroit 26
Cadillac 5752
Tele. DE 507

Vinco Corp.

v:;

Warner Co. common*

H. M. Byllesby &

,|J

Company

PHILADELPHIA OFFICE

Teletype BS 424

Phila. 2

Stock Exchange Bldg.

GRAND RAPIDS

N. Y. Telephone CAnal 6-8100

share of common

Phone Rittenhouse 3717

one-fourth

Company;

common

Electric

stock of
Com¬

Power

preferred stocks).
North American
would

nois

would have

plan

American

North

the

Missouri-Illi¬

(under the previ¬

Company

ous

Company itself

the

become

holding

Company,

become
Regional

Washington

Railway & Electric Company and
some
Pacific
Gas
&
Electric

stock). North American Light &
Power

Company, an intermediate

holding company with holdings of
Power and other utilities

Illinois

would be dissolved.

termediate

Another in¬

inactive

but

holding

Illinois Traction Com¬
is already being dissolved

company,
pany,

under SEC and court orders.

As¬

suming that Illinois Power Pref¬
is

stock

erred

converted

into

stock

(conversion being
forced through a redemption pro¬
posal) and the warrants exercised
by Traction Company are exer¬
cised, the three companies (North
American, North American Light
& Power, and Traction) would to¬
gether own 32% of the Illinois
common

Power

stock.

common

It is also

proposed that Illinois Power also
$16,000,000 new non-convert¬
ible preferred to be used with
other cash to pay off the $13,-

issue

dividend

381,601

certifi¬

arrears

cates, and to reduce bonded debt

$9,320,500
(with a general
refunding). Illinois Power

bond

Union Electric,
plan proposes to retain
these properties under the new
holding company.
Stock of the
holding company would then be
exchanged for public holdings of
Illinois so as to give complete
control to the holding company.
integrates * with

hence the

North

tailed in
pages,

tions

American's

plan, as de¬
pamphlet of some 42

is divided into three sec¬
(A, B, C) dealing respect¬

one-fifth of one participat¬ ively with the major plan, a plan
unit of common stock of for the small non-utility holdings,
Washington Railway. & Electric and the plan for dealing with Illi¬
Company and one-tenth of one nois Power and the two inter-'
share of capital stock of the St. mediate holding companies. : Plan
Louis County Gas Company when B is naturally the most compli¬
recapitalized.
The proceeds of cated and accounts for over half
of the pamphlet.
It apparently
the sale of the divestment units
makes no exact provision for set¬
would be
used to pay off the
tlement of the litigation pending
Company's bank loans, which now between the two North American
ing

Sterling Motor Truck

Members Detroit Stock Exchange

April 18 filed a new integration

pany;

Mercier, McDowell
;

one

share of

one

Wisconsin

Empire Steel Corp. com.

vH; Pittsburgh Railways

STREET

share of common
sub-holding company
V; "Missouri-Illinois

one

stock of the Cleveland Electric Il¬

9, MASS.

HANcock 6200

$6 per unit and it would consist of

Pont, Homsey Co.

Illuminating

Electric

vestment Unit" would not exceed

||S|SheIler:||I|:

Request

Approximately 34V&

subsidiaries—

certain

exchange)

Electromaster, Inc.

& Dolphyn

Los Angeles

■

pur¬

Unit"

Electric Company of Missouri and
Illinois Power Company) plus a

Philadelphia, New York and Los Angeles

Manufacturing .Corp.

Descriptive Analysis
on

for

warrant

"Divestment

entire

Philadelphia 2

record

May 1st. Previous quarterly dividends
have been disbursed at the rate of 25c
per

Stockhold¬

direct method.

more
ers

Company"* (which would own the

Philadelphia and

Private Wire System
•••

stockhold¬

Company's

termed

Hagerstown, Md.
N. Y. Telephone—WHitehall 3-7253

substantial amount of the output is
fold for export.
•

'A'j.

Stock Exchanges

Angeles

Walnut Street,

New York

•«

Pittsburgh, Pa.

DETROIT

North

hands

Each share would also receive (in

Request

Members New York,

15,

Company

BUCKLEY BROTHERS

1529

•

the

stocks

stock

BUILDING
MOINES 9, IOWA

and the plan ac¬

taken

was

cordingly

Wisconsin
Electric
Power - Company,
Washington
Railway & Electric Company and
St. Louis County Gas Company.

Common

EQUITABLE

better
known
frey
goods
of medium
yarns
drill),to coarse sheet¬

and

preferred stocks.
While hearings were held imme¬
diately by the SEC no further ac¬
can's

Company,

Metal & Thermit

Sioux City Gas & Electric Co.
•

Distilling

Gruen Watch

V-i

Incorporated 1841

subscription

and. exercise

rights to the new stocks, the cash

Cleveland

United Light & Railways Co.
Preferreds

this old plan stockholders would have been permitted within 60 days
following approval of the plan, to«>turn
in
their
North
American of which were used to redeem the

-.'

Company

which would consist of fractional

PHILADELPHIA

Iowa Power & Light Co.
v,':

American

plan with the SEC, following the Supreme Court decision rejecting
the appeal against "the death sentence."
The company had sub¬
mitted a previous plan on Aug. 4, 1943, which provided for setting up
four regional holding companies and a liquidating company.
Under

members to meet

Common Stock

Thursday, April 25) 1946

Tele. PH 73

amount

(proceeds

$50,750,000

(Continued

on page

2249)

Aeronca Aircraft

TRADING MARKETS

Bangor Hydro Electric

Conv. Preferred

Common

Boston Edison

Common

Hollingsworth & Whitney
■:,Common
£,?,,
Megowan-Educator Food Co.

Southwestern Public Service

Grinnell Corp.

Common

■

;

•

:3b

Southwestern Electric Service

COMMON STOCK

■

Common

*'Memo

'•

request

Texas Public Service

Inquiries Invited

•
*

New England Lime Common

*..VV

white, noble & co.

Submarine Signal

Members Detroit

Dayton Haigney & Company

GRAND

Stock

Phone 94336

Teletype GR 184

■

REctor 2-5035

-'i'sA

J-

5-;i.y:*vV

'■

Common

Phone

PH 30
to

N. Y, C.

7-1202

COrtlandt

Produces
and
Of

roller

over

the

ESTABLISHED

bearings.
per

precision
Has

net

peacetime
1941).

earnings

>.tj

New

Louisville Gas Pref.

INVESTMENT
509

'/!

*:)/YTVii* '

wt-f

■

OLIVE

STREET

Portland Electric Power Prior Pfd.

Incorporated
Investment Securities
49

Federal St., Boston

Tel.

HUB.

0810

New York Tel.

10,

Mass.

™I BANKERS BOND £?:

CAnal

6-3667

New York f Philadelphia
Washington
Aljentown Easton Harrisburg Portland

St.LouisI.Mo.

Incorporated

Teletype BS 189
1st

Floor, Kentucky Home Life
LOUISVILLE

Bldg.

2, KENTUCKY

Long Distance 238-9

Members St. Louis Stock

Exchange

Gilbert J. Postley & Co.
29 BROADWAY, NEW YORK

6, N. Y.

Bell Tele. LS 186

England Public Service Plain Pfds.

SECURITIES

Winn & Lovett Grocery

~W. H. Bell & Co.

1879

Federal Water &Cas Common

Stix & Co.

Merchants Distilling Co.

($3.14

Central Ohio Light & Power Common

Girdler Corporation

jbatlLi

quick

share and has shown

good

American Air Filter

finest

:3-'-ib'-bbb-b

'V*:v;3-

,T>"

American Turf Ass'n

.■

Paine, Webber, Jackson & Curtis

LOUISVILLE

;•

Puget Sound Power & Light

Norma Hoffman Bearing Co."

Common

•

& CO.

Pennypacker 8200
Private

Private New York Telephone

••''•'...A',',./.

Philadelphia 3

1606 Walnut St.,

MICH. TRUST BLDG.

75 Federal Street, Boston 10

•

| BOENNING

Exchange

RAPIDS

""Sr

,i;

Direct Wire to Chicago

>'■

^Volume 16 J

{lumber

THE COMMERCIAL & FINANCIAL CHRONICLE

4484

Subsidizing the British Empire
j'

V.'.;''.,'

By JESSE;H. JONES*
- :
V V;-'1' Former Secretary of Commerce

Factors

>
Vf'

■

undertake to play Santa Claus to rest of world." |

I dp not think the proposed British loan of $3,750,000,000, now

before Congress, should be made and do not believe that any good
will

the

American

the

United

States

vitally
furture

concerned,

«to

agreements is before the loan is

the

omy

consideration.

econ¬

made.

the

i t

other

from
it in
present

form.
If

make

this

loan
Britain
a

refuse

able

without

particularly

proper

since the
profit¬
operations

substantial

have

investments

and

in the United States which could

should be loaned
expenditure > in

for

countries

British

loans

be used

similar

Britain

security,

The time for these

3. No money

world,,
making

for

left

are

collateral for

Prominent

terms to other

loan.

these is in¬
from which they make a

surance

among

Jesse H. Jones

defies

pass
the
joint resolu¬
tion is a gi¬

science

branches

the

greater

spec¬
The latter

ulation.

Vandenberg

A. H.

even

It is a question

should

agreement

determined

are

the

left
In

tiations.
ence

of.

loan.

for
the

empire

Government

con¬

there

two

and

make

and

future

editorial by Mr. Jones in

*An

loan
prefer¬

the

"Houston

16, 1946.

and the proposal for the ex¬

April

Chronicle,"
K

which

(Continued

Lord

2236)

on page

Keynes' Death and World Fund and Bank

Important position occupied by British economist in these institu-

'[■: lions not easily filled. His

successor not yet determined. Lewis \
Douglas not to be President of World Bank but Camille Gutt of i

Belgium likely to be General Manager of Fund.

Opposition to

Chinese loan voiced.

address

Senator

Van¬

WASHINGTON, D. C., April 24—The passing of Lord Keynes
a vacancy in the boards of governors of the Fund and Bank.
Keynes was Britain's governor on^
Still
prominent as a likely
both bodies. The alternate gover¬
nor

choice

for the United Kingdoifc, R. H.

this

the

Fund's

general

both

the

Fund and the Bank.

year

not occur until September.

for

director-elect

tive

and therefore is
not expected to take the place of
Keynes, unless temporarily. The
next meetings of the boards of
governors of Fund and Bank do
retire

;

managership is M. Camille Gutt
of Belgium, at present an execu¬

Brand,
head
of
the
British
Treasury delegation in Washing¬
ton, has long been expecting to

The
now

Indian

Government

has

decided that Mr. Joshi will be

its executive director of the Fund
and Mr.

Sundaresan, of the Bank.
k
There has been nothing official The latter, who has been Joint
Secretary
of the Finance Min¬
as
yet from London as to the
British executive directors and istry of the Indian Government,
alternates on the Fund and Bank. is now in this country, where in
The directors meet early in May. addition to his Bank post he will

Temporarily,
serve

Government

the

by
of

V:\

Fund and

'/•:

■

Federal

Reserve

and later Secretary of the NAC, in
which capacity he made * the ar¬

•

■

Governors

Vice-Presi¬
positions q£

ciates

con¬

serve

the

that

senior responsibility

In
Washington,
Mr.

where

serv¬

the

fund ; by

the

years.

NOTE—From time to time, in this
there will

and

convertible

common

into

about June

1, 1946, at 106%% $1,467,000 of
5% 15-year debentures, and to re¬

Roman L. Home
/

deem

basis, he has been busy arranging
temporary quarters for the Fund
and making preparations for the
convening of the executive direc¬
tors on May 6.
Mr. Home has

the

same,

time

37,500

shares of 5%

preferred stock at
share, with accrued divi¬
dends from April 1,1946,
The
balance will be applied to gen¬
eral corporate purposes.

$21.50

Americans.This is number 123 of a seriep.

SCHENLEY DISTILLERS CORP,

"Pow-Wows"

We take pleasure in announcing,

Canadians have decided
taking

great deal
.and,please

laugh^Tow-Wows". "The;

idea for the

organization, Ameri¬

Prisoners

of War, with a po¬
tential membership of over 125,000
can

•was

conceived in the German prison

where

camps

of different nacreeds and color

men

races,

camps,

harmoni¬

they reasoned, it could also

be done

national and inter¬

national, scale."

—

The above description, of this

•

"Pow-Wows," is

organization,

nejv
a

quotation from soft-spoken, mod¬
Kovacs, formerly Lt.y

est Paul A.

Kovacs, AAF, bomber pilot and
possessor of an extraordinary war
record. Literally, he is back on the

•

ground, with both feet, and busy
job with one ofSchenley's im¬
portant distributor organizations.

at his

Before the

war

was

with

our

And does he think he's
lucky! On his thirtieth flying mis¬
sion, he was returning from action,
over
Germany. Target: Regehsburg. With his plane afire, and
himself, and seven of the crew,
seriously wounded and after his
company.

his

own

was

good luck began when hjs

parachute "worked."

James Day President of

Chicago Stock Exch.

cember.

THOMAS G. CAMPBELL & CO.
MembetylNew. York Stock Exchange

organization, American Prisoners
of War. Paul explained that it to

^7^|^s|REET,iV

NEW YORK S, N. Y.

come

Canada's reason.

May 1st, respectively.

effective

April 30 th' and
-

policy of the "Pow-Wows" to

eran's

■,-n

organizations.

THOMAS G. CAMPBELL
E. EDWARD BOLLINGER

Mr. Day, who has been
of the Exchange,

here express disbelief that this is

the

work with, and thru, existing vet¬

WHitehall 3-6893

l-i\ 4

Member New York Stock

Exchange

WILLIAM T. CAMPBELL

one

goes on,

president, and moving spirit, bphind this unique, new, veteran's

that post in the vice-president

According to

time

Well, anyway, Paul is the first

foreign prior to his association with it was
source, this is due to Canadian president of Ryan-Nichols & Co.,
dissatisfaction with the large voice now the First Securities Company
which the 12 executive directors of Chicago.
Mr. Smith's resigna¬
will have in the Fund.
Others tion and Mr. Day's election be¬
Fund.

don't

will hear

against

more, as

organization, about

a new

feet. His

the formation of

supposing that the Administration'
has altered the decision, disclosed
^CHICAGO, ILL.——James E.'Day
at Savannah, to seek that post'for has been elected president of the
an American, and leave the gen¬
Chicago Stock Exchange to suc¬
eral managership of the Fund to ceed Kenneth L, Smith, who an¬
some
other national. One hears nounced his resignation last De¬
that the

Here's

which

saved by his engineer, who
tossed him into the blue—at 20,000

;; The

reported unavailability of
Lewis Douglas for the presidency
of the World Bank means that
some other American will have to
be found. There is no reason for

By MARK MERIT:

life

is very democratic in nature and
his associates to call him

space,

advertisement which
hope will be of interest to cur fellow

order to "abandon ship",

financial

likes

"Sandy."

one

stock, has been

Proceeds from the sale will be
used to redeem

■

appear an

learned to live together

oversubscribed.

reimbursable

-//V-■

■:

Offer'g Oversubscribed

Treasury De¬
partment on

heads of

ously. If it could be done in prison

share of

ices have been

lent

major departments during recetif

tionalities,

shares of 4% cumulative convert¬
ible preferred stock, series A, of
the Drackett Co. of Cincinnati,
Ohio.
The stock, priced at $25 a

capacity.

Home's

number

Drackett Co. Slock

An underwriting group headed
by Van Alstyne, Noel & Q®. and
Field, Richards & Co. on April 22
offered a new issue of 108,000

has

fund

the

their assso-

TV A,

Board,

WPB and Treasury.
For a while
he was Secretary of the WPB

Board

there,
since

constitute

now

dents who have held

since 1934, having worked for thq

resolution
the

McCain will

Mr.

service

rangements for the recent Savan¬
nah meeting of Fund and Bank.
Mr. Horne, now 45, obtained a
| A native of North Carolina, Mrl JPh.D. in monetary theory at Ohio
i
Home, Assistant to Secretary of State University in 1936.
the Treasury Vinson, at Savannah
served as temporary Secretary of

his country's

director of the Bank.

the

Secretary of the
International Monetary, Fund

advisor to the
Mr.' Brand
may
executive Indian Agent General. Sundaresan
serve

•

Temporary

tinued

leaves

been

ROMAN L. HORNE,

C
.

pansion of world trade, in which

four.

denberg in the United States
Senate, April 22, 1946.
\
>
(Continued on page 2256) * ; j

the
Reconstruction and

Development.

nego¬

present

tariff

Bank for

outside

director.

Mr. Aldrich- Mr. Campbell and

standard blueprints

are

two

since 1929, was elected President

bank and will have

interchangeable.
men

Chairman of the board, and Ar¬

SCHENLEY DISTILLERS CORPORATION

tional Monetary Fund and

security for any

loan of dollars to be spent

Nothing

Director?,

thur W, McCain, a Vice-President

Officials of Fund And Woild Bank

advance

Board, of

and

can,

*An

having a value of chance is the better one for the
is most unbusinesslike.
$611,000,000. These and other as¬
sets
are
owned
/ /1. Five to 55 years, or pracby the British in
tically two generations, is much this country, the profits and in¬
too long a time to lend money to come on which are going to them.
a
a foreign government
without These assets and the profits of
First - of a. series of bio¬
British insurance companies from
security.
graphical captions of persons
; - 2. No loan of any kind should business written in this country
connected with the Interna¬
be made until all considerations should be used by the British
incident to

the

the top management group in

surer

its, promise of
vindicated wisdom. It is probably
sure.

the

widely

where

than the former in

less

are

"doubts"

understand how

There
is

ing

The

as they have, come
differing conclusions
are
so
many im¬
ponderables involved. This is not
a
problem in exact mathematics

the joint

pass

Make

the' loan?

is that the

because

resolutionmay

what?

deny

"don'ts"

can

specu¬

corporations

Furthermore, the proposed loan

Don't

trouble

lation; not to

controlled

don't."
loan

conclusion,

peace¬

ly, in the usual rule of prudence
which
says,
"When
in
doubt

certainty

any

ful, stabilized world,
I find no comfort, unfortunate¬

gantic

623

•'■■■• «—~.,—.

subject

; the board, after the regular meet¬

Campbell, President of the bank

information

which

was .announced by
Winthrop W. Altfich, Chairman of

since 1934, has been elected Vice-

every
avail¬
able source of

positions in the Chase

National Bank

problem

of American welfare in

and advice.

An important change in senior
executive

I have refrained from taking my position
United States to take for the sake

American

and

years.

could exhaust

very

substantial profit out of the
people.: According to
much in the
a
recent report
of the United
nature of an alliance with Great States
Treasury,
British-owned
Britain as to cause other countries assets in this country aggregate
to feel that we are less friendly more than $3,000,000,000, and in¬
to them than to Britain.
clude $587,000,000 United States
Government securities, more than
$40,000,000 in corporate bonds,

coimtries,

would

18 Senate

until' I

'it

Wednesday, April 24. H. Donald

This British loan has perplexed me more than any other
in all my

Joins Aldrich, Campbell

Favors stabilizing dollar-pound exchange.

agreement.

come

people, or, for
'that matter,

deciding that loan should be approved. Bases decision on
(1) general public approval of loan, particularly by business in¬
terests ;(2) without loan Bretton Woodswould be
nullified;
(3) we oeed npt fear added imports; (4) loan will not encourage
Socialism in England; (5) there is likelihood that loan will be
repaid; (6) no precedent is set for other loans; (7) both labor and
agriculture will benefit; and (8) world peace will be favored by the

capacity before

Recommends RFC increase its credit to Britain by $1 billion and j
products. Sees inflationary force in extending foreign loans and J
says that we should "take stock of our resources and our earning ;

;

•;*; '.t. • S. Senator front Michigan

Vv1:

Veteran Republican Senator, in weighing the "pros and cons" of
the Anglo-American financial agreement, strikes a balance
by

that additional credits be given on pledge of new security and that
cotton and other U. S. raw materials be
exchanged for British r

•

opposes loan to Britain because (1) it is f
unbusinesslike; and (2) Britain can get along without it. j

most
:

Of Chase Nat'l Bank;

By HON. ARTHUR H. VANDENBERG*

Former Cabinet officer

Arthur W. McCain Pres.

Loan

Favoring

Schenley is proud of this lad, and
the many

others who have come

back, and

are

coining back,

wear¬

ing—that button.

DOROTHY JANE LUCK

(limited partner)
.

April 22,1946

MARY E. CAMPBELL
(limited partner)

FREE—Send

postcard to MARK MERIT

OF SCHENLEY DISTILLERS CORP.,

21 A, 350 Fifth Avenue, N. Y.
you

will

prints of
fects

receive

earlier

booklet

Dept.

1, N. Y„ and

containing re*

articles on various sub*

in tn;s series.

•*rf HE COMMERCIAL

2222

EINANCIAE 'CEEOEICLE
"&

V>-

•

Thursday, Ajjril 2$, 1046

iiiiiiir'iif

Instrument

Hammond

Analysis—Caswell

Trading Market

Dealer-Broker Investment

South

PREFERRED

•

1 ;r

-V '?

r" ^ •

;

«>«v

I-

Established

—Kaiser

1922

Tele. CG 271

ol coTnmerit
i

of Securities Dealer*

;

Pacific Coast

—

For

■

UNDERWRITERS

CHICAGO 3

135 La Salle St

State 6502

California, 210 West Seventh
Street, Los Angeles' 14, Caiif?
: : rAlso- available is 'a; tabulated lis!

The

//;/

LA 255-

Insurance Stock
Analyzer -f
Geye'r & Co., Inc., 6? Wall Street,
New York 5, N. Y.

■„;

Utilities Corp.

"Investment

•
^-

j
j

The-Muter-Co.
"
•
' •
-''.""i |

■

Circular

Request.

Co.;

Cofp,' —^
and

memorandum

Bowser,.incurve

x|
Compa»y-i

Ana1 ysis—James- M. Toolan & CO.,
67. Wall Street; New York 5, N. Y.

N.'Y^"""

••

Street, New York ,5, N;

KoidrHold X~ Circular e-.Pulis,

f; j «>**•<-;, [ ,
Shore & South

Doyle,

South La Salle

Mont¬

-fx

bulletin

O'Connor & Co., Inc., 13"

111,

Street, Chicago

:Ji:-'j-

t-'V1

y I'I

laave :

Gompany ^Study:
a&

First

purchase

Oii

sound specu-

Colony

York 5; N; Y. Special letters
avail}rble -on Dumqnt ; Electric. Corp.;
Princess Shops; Electronic; Corpi;
District Theatres Corp.; and Sim'

Fifth

N. Y.

New York 1,

Avenue,

:?xV/X:-/;/'X

building, x>and
industries—Raymond
148 State Street, Boston 9,
XX*11 vXv :,,x: ?X! 1 /. XX''l ;t fi

automobile,

frozen

& Co.,

Mass.

food

Portland

X Spokane

Cement-

Bulletin on recent developments—

Lerner

Co., 10 Post
Square, Boston 9 Mass. ,'

Office

Sports Products, Inc.—Circular
—Hardy & Hardy, 11 Broadway,
New York 4,
Nj
.

Steel Products Engineering Co.

manufacturers

—Survey ' on

/ of

automatic

Roy'Presses & Co., 52William Street/New York 5, N. Y.
-'r
x '
Sterling
Motor' TruckxiCom¬
stoker—J.

pany

Circulai
Adams & Cp.,
Sa'lle-Street Chicago

—

231 South La

4, in.

....

v:
i/WpMJvfi1:"fifty y'C1 t^'Ki t,t !:X X'.;
Sterling Motor Trpck ;Cq- Inc.
—Circular—Pulis,. DowRhg & Co.,
25;v Broad Street, .New: York 4,

■

y,.;vv,,

Pattern

xxtxx

/ ThermatQmiCv Carbon
Co.
—Circular—Hoit, Rose & Trosteiy
McLaughlin,. Reuss &; Co., ; 1 '.Wall 74/Trinity Place, New York 6,
Street, New' Yorkr5, N."Y.
.
I N'" Y X'''V<irY*'V/r
■M-r-

>; Consolidatedr Gaa Utilities anfc
The
Chicago Corp.—Circulars-f

•

stock

Corporation, 7j0 Pine; Street.*Nevi

plicity

Street,?; Sari Francisco -20,

gomery

common

Chicago South
Bend1 RR. ^-Revised

350

"Combustioneeri,"/

Papier-— .Descriptivle

u-,..T,r"".' 7*

Merit, in care ol
Distillers Corporation,

•

icKihney fCoastaf Gil

Lfe Jtoi

Central

Chicago Corp. '

outlook

Also availahle is

circular—Adams & Peck, 63 Wall

isr

Guide"—April

—First California Ca.,- 300

■

'XV;.,;'.'v

Detrola

XV"

Canadian Western Lumber C

contains discussion of .current
outlook for securities market
an^
data on several "interesting issues

Consolidated Das

post¬
war position—J. F. Reilly &
Co.^
"he.: 40 (Exchange Ptacbj. Ne'w York

Boston & Mainer—Suggestion oj!

Street, New York 5,

New

—

Grape Juice Co.—Strauss

:",i
V

International

insurance }^anct X bapk /stoeA
for deMers* only.

interest to holders, of the commof
stock—Amos Treat & Co., 40 V

i4rOhio,X X»

Discussion

quotations

sue

BroWnhoist

Union Commerce Building, Cleveland

Current

—

memorandum—Butler-Huff & Cd.

contain¬

Michigan 4181
,v

America

Ltd.—Special circulars-Ask rnj
Bros., 3? C-l—Maher & Hulsebosch, •: 6;
Broadway, New York 4, N. Yr ;:;i' | William Street, New/York 5, N. Y.:

650 S. Spring St

;

CG 99
s:

•

LOS ANGELES 14

ing brief analyses of Philip Carey
Manufacturing Cof; Sargent & Cor.l

and review

Co.;* Punta Alegre Sugar
Corp.; Haytian V Corporation X ot
America; Latrobe Electric Steel
Co^ Ray-O-Vao Company; Fort
Pitt Bridge
Works .and Welch

MARKET fX

distribution

Bank

niture

^SECONDARY

r.r.

Corp.;
Armstrong- Rubber
Co.;
Ohio" Leather Co.; American Fur a

Wholesale Distributors
V—

[

Industrial

;

circular—Gottron-Russell

Appliance Co.; Pettibone Mulliken

Mmbtn National Association.

-1

4 r_

Upson Company; Lawrence
Portland Cement Co.; The Parker

CARTER H.wv..w..

Middle West

Corporation—Analy •
sis—Ward & Co., 12Q Broadway,
NeW Yotk 5,;N. V, ;
^ 5^^ (,■

Building,

4, Calif.

Mark

the

Aspiitook

Geared to the News—Brochure

Co.;, Rtxss

;;.;--v■ ■".;..

CHICAGO 3
f«i; Randolph 6960

San Francisco

120 South La Salle Street ?

running in the Chronicle—

opment of plywood and its uses—
! Simplex Paper Co.—Descriptive
Amott, Bakdr & Co.,' Incv, 150
analysis discussion potential postBroadway, New York 7, N.
wnr benefits to the company from

*».' /

C. L. Schmidt & Co.

SChenley Distillers Corporation
of articles they have

---Brochure
been

write

;Haskelite Manufacturing Corp,
-^•Study firm pioneering in devel¬

///

;X'x' COMMON
.Directory of Stocks Traded oft
Pacific Coast Exchanges—Revised

Street,

Scheitley

It is understood that the firms mentioned will he pleased X.
/
to sknd interested parties the following. literature:: f'f

Salle

—

120
Chicago

3, 111,

"Recommendations and Literature

Sun-Kraft Inc.

Co.

Co.,

V >

Lehigh

Valley

RR.-e-Circular—

Investments Jfor .Savings' Hicks & Price, 231 South. La Salle.
% ff
hy
'■
.XeXgvXvflXx j'
Massachusetts—Annual
Street, Chicago 4, 111.
' J
a
"
XxLipe^RbllwayXCorpi-rXCirclilar-booklet 'released by E. E. Day &
Universal Zonolite- InsulationV Also available TS a recdnt InemL
-f-Herriek,
Waddell
.& Co., Inc., 5
Co., Ill Devonshire Street. Boston orandiim on The Muter Co. j
Analysis
— Caswell
'& j Co.,
120
;
Liberty .Street, New Ycrrk.5, N.Y.
9, Mass.* ^
~
* *. *_______
South La Salle Street/ Chicago '3/
■if
' 'X t -°X"X
c
-r!
X'r'V'-V 'V * -V' V
r
r'? T'V" "X? <
111.-V-^'V .T.:■'» :■
L; Aj DarlitigA v/O*—One- vcorr^■)r Merchants
Legal

Ranks

*■

HICKS & PRICE

stocks' for

\'"ftf':.'. Chicago Board of Trade

St., CHICAGO 4

So. LA SALLE

231

•..x

Rj.ndolnh 5686—CG 9^2

York City Bank

Stocks-i-

Cbinparison: and; analysis

Principal Stock Exchanges

Members

New

the

first

of'19

Distilling:4-:'MemoX

Analysis for- dealers onlyland & Co., Penobscot Building
Detroit 26, Mich.
•; v X X
, -*•
1

quarter

in* four " growth

pany;

1946—Laird, Bissell & Meeds-120
Broadway, New York 5, N. Y. -nvp
"

New York Office
•

*Woodall Industries, Inc., Pfd.
'

•

..-Ai.-f

•

Co., Common

Snap-On TodU Corp., Com.. ,1
r//*

**■'^"I-

■

*"1'

•-.*•'

■

Prospectus Available oil Request.

Beat

Estate

Members Principal Stock

';f

Study of outlook and speculative

possibilities for appreciation for

especially attractive at this time,
including Brutiswlck v Site
Co.;
Commodore Hotel; Hotel Lexlngton, Inc.; Hotel Waldorf AstoriW
Corp.; Hotels Statler Co.; N. Y.

this

Exchanges
i

10 So, La Salle St., Chicago 3

{

Tel. Franklin 8622

Indianapolis, Ind.

Teletype CG 465
-

•

;

available

Hotel Statler Co.; Roosevelt Hotel

Shoe;

NY; Savoy Plaza; and 870 Seventh

New

Aye.

Corp.—Ask

Co., ' Inc. p

Baker v &

Rockford, III.;
V
'X/XX

Cleveland, Ohio /

15b

American Bantam Car—-Special
Treat
dz Co., 40
Wall Street, New York 5, N. Y,
j
Also available are reports oh
Automatic Sigiial Corp.; North¬
ern Engineering Works; ahd Van
Dorh Iron Works.
: 4 '
'
' I
'if- V %%'

Iti

Plans

Its; Branches!

Prepared—Conference

Albert jFrank

Invited

New York 6, N.Y.

Thermit.

memoranda

are

-■

Miller Manufacturing
alysis

current

231

South

Salle

Also

Co.,

of«

/.to:

Motorola—-Circular

Gaivin

partic¬

ipation in the
•

National/Gas Af *Llectrie Corp

Gas Corp.

—

Inc., 37 Wall Street, New York 5

Harding/

stock!

offering copibination of improving

son

utility income/together with • ex¬ Cooke, Civil \m
W a- r
finan- f
cellent
speculative
possibilities
;(i
.............
frorh hil^^ develooments-/Ffed W? Cier,,' rose to 5
Barclay Harding"
.

the

—?

Revised

•

Street, Philadelphia

;y:':v,r

•:::

•

Lubetkin & Co.3
Street, New Yorfc4; N. Y"

memoranda

Co.;

Reda Pump Co. and Merchants

man

available

are

Distilling.

" XVV-'X

'Tennessee

Products;

-*»

■

...

■''

■

Well-,

;

•

the Army of1 the
States, serving With the
Transport ;: Command. X H I s

United

Air

iXNew England Llmc'XIOmpany-^
Descriptive
circular ---Dayton

other Government

activities; dur¬

ing the war period included: Di¬
HaignOy & Co., 75 Federal Street.
rector, ; Transportation
Division,
Boston 10, Mass.'
XXxx:X:X'XX'': ;X Office 6f Coordinator of IhterAmerican-

XXXXXt:|j': Xf/"

Corp.

Razor

Upson

^rlass; Doyle Manu¬

facturings

Safety

Engineering Co.; Kendall Co.;

Shatterproof

Vv/V^x

Also detailed circulars

rank

A"Cb., 208 Sotitb La Sailt'
Gaivin Co.—Descriptive. Circu¬ Street Chicago 4, 111, X XX Colonel/in
i:
f.

New England

Public Service Co.

> Affairs;
Vice-Presi¬
dent, Defense Supplies Corpora¬
tion, the Reconstruction Finance
CorporationX subsidiary;. Deputy
Administrator^ Aviation, in the

1 Grihnell Corp. — Memorandum* —Analysis—Ira Haupt & Co., 1.11
Current memorandum^— Hay-*"
Broadway, New York- 6; N. Y; > den, Stone & Co., 25 Broad Street, —Boenning & Co., 1606 Walnilit
New York 4, N. Y. ,WW Street, Philadelphia 3, Pa.
f X;
•\ :;
rr \ ' r ' " •"*:"* ;' T ■'
|y V;V ^ Ndftherh Pacific vs. New York Surplus Property Administration.
Mr. Harding, who was active be¬
Central
Analysis'— Vilas- '&
fore the war. in financing aero¬
Hickey, 49 Wall Street,-New Ybrk nautical ;
-We Maintain Active Markets Inenterprises, .will ..direct
3; N. Y.X X;;:v'XX-' X-;;//X,X-''-vVf^
the activities of Smith, Barney :&
Co. in the field of raising venture
INTERSTATE I5AKERIES CORP Pfd.V& Com.
■

I SINCE 19081

rnemberd

Phenolic

American

Wm. Barclay XHarding, a partut
investment
banking
firm of Smith. Barney & Co., 14
WailX Street,: New X York City,
nef

active

Memorandum—J. G. White 8c Cd.

41 Broad

Y,;|X/p|

the New York?;
-containing a Stock 1 Ex-."
discussion of Public. Utility Hold-:
Change
h as X-.j
ing Company Preferreds.
returned

—Late" memorandum oh
Federal Wafer &

1529

Corp.—Analytical circular—Gra¬
ham, Parsons & Co.,
14 Wall
Street,,New York 5,:N.

letter

Walnut

■

Street," New York 4,. N. Y".
available ik the fortnightly

ihVestiheht

Sheller Manufacturing, Corp.

lar—-Seligman,

2, Pa.

;

Coke

Recent

Inc.

American

■>'. &

'''
■

Coal

study—H/ Hentz

'f;

;

.anc

Mlssour i-ltb nsa«-Texas-^Ahaiy-'
X?cal

":**

Street ?

CJ.iicago.4, 111...

Beaver

Virginia

Gd.r

situation

prospects* for' 1946—Comstock
Cry.,

,•

available

Gruen Watch Co. and Metal <fe

rfr::

Manufacturing Co., makers of the firm after an ""p
o f
Phonographs absence
report — Mercier;
McDowell S.
^Seligmart, Lubetkin '& Co.,,; 41* 5%":'years ill /
Dolphyn, Buhl Building, Detroi
Broad Street, New York 4,N. Y? : - Govonnment
26
Mich.
j
1
n X
X "j:
V. U
V^; e
.y-y. ; A - j service. ;?; Mr. X
Also 1 available
a
report X oil

memorandum—Buckley Brothers;

Telephone GOrtlandt 7'5060 /• j/
Boston Chicago Philadelphia Sati Francisco

•Also
m

Fairtttan

Guenther Law

Incorporated

131 Cedar Street

MaiiuficiuringXvGbl

•

West

Motorola Radios and

Circular—De Young, ^ Larson ? &
Tornga, Grand Rapids! National
Bank Building, , Grand Rapids S,

All

Col
Mq-

«»; |

Electromaster

i
American Forging and S ocket—

ADVERTISING

Descriptive
ahalysis—du X Pont
Homsey
Co.,
31 ; Milk "X Street
Boston 9, Mass.
/ ^

report^—Amos

Mich/.

General Tin; : Upson
Worsted Mills:

Jersey

Dwight

•

FINANCIAL:"

late memoranda ori

C2l4- «...

list

for

are

Great ?« American-Vv industries:
Alabama j Mills,
Inc.;« Douglas

Chicago Board of Trade

company—Ward

& Co.,? 121
Broadway, New York 5, N. Y. Alst.

Co.-L

Iron

Stocks—

Equity

Broadway^ New:York 7,"N. Y.V

Established 1916

Malleable

Analyses of situations eonsidefed

Amott,

'Ml H.Davte

Dayton

■

Wells-Gardner & Cd., Com.C V

•Camden Forge

"''r'

1 Wall St. • {

'•t -f fi

rV-'

randum—Buckley Brothers,* 1529
Walnut Street, Philadelphia 2, Pa.

—

Fred.W.FairmanCo.I
.
.

Members

r/v

•

Chicago Stock Exchange X;
Chicago Board of Trade

Corporation Common Stock
Write
A

discussion

For
of

N-l,

this

''r'1

company.

Telephone Randolph 4068
Direct Private
Bell

Wire

New

System CG 537

%■

York

.'V.l"

*...

H M.

208 SOUTH LA SALLE ST.

CHICAGO 4, ILLINOIS

L. JACOBS COMPANY Pfd.'

X MOUNTAIN StATES

7;' "♦'

•'

x;"''

-*•

V-1_""

Incorporated

'•

133 So.'1 La Salie Street, Chicago 3 v
Telephone State 8711
Teletype GG 273'.
.

New

York

Philadelphie

plttRbureb

Minneat)oli»

brochure

Capital.

growth,

...,

;

Ro^enfeld With

Blyth Co.

dealers ;> PORTLAND,
OREG.—William
through' Floyd D. Cerf Co., Inc., Rosenfeld has become associated
120 South La Salle Street; Chicago with Blyth & Co., Inc., Pacific
3, 111. •'
"X'x ' "■'/./;
' Building. ? Mr. Rosenfeld served
industries—-Available

mer¬

chandising methods, management,
and potentials in paint and oil

POWER CO. Com. & Pfd.

Byllesby and Company
...,

Nu-Enamel Corporation

'• i

obed

XXVV'VXv-F.

National Gas & Electric

in the Navy from
.

Panama Coca- Cola—Circular

ihtei^sting

possibilities

Rose <%■ Troster,
New York

Hoit

—

74 Trinity Place.

6, N. Y.

ber,

1942 to Decem¬

1945,; holding the rank -of

Lieutenaht at

the time of his he-

lease to inactive duty.

X X?

THE COMMERCIAL & FINANCIAL CHRONICLE,

2223

"Please exert every effort to obtain endorsements for the Boren

Bill within the next two

three weeks.

Now is the time for action."

SECURITY TRADERS ASSOCIATION OF JNEW

fORK:

In New Location

April 26th, have been closed, it was announced by John M. Mayer,
Merrill Lynch, Pierce, Fenner & Beane, Chairman of the arrange¬
Committee.

'dealers from all

f$M\/W,

The Bond Club of Louisville

announces

accommodations will be available to

made

promptly. First come, first served.
"
"""Y "v/f;...
Tickets for the party on Friday night will be $7.50 each,' payable
in advance. It is hoped that a number.of our out-of-town friends will
are

come

honor of

Write Ora M. Ferguson, c/o Merrill Lynch, Pierce, Fenner and
"Beane, 231 South. Fifth Street,. Louisville, 2, for reservations and.in¬
formation;
:
v
:
,
.
■

■

j -

.-(Special, to -The Financial- Chronicle)

CHICAGO,

ILL.

Zazove has become affiliated with

Y.-y.

jStreet. Y,Y
;

(Special

to-The

with

now

Glore, Forgan &/Co.
v: -'r

and with

(Special to The Financial Chronicle)

invitation of the Chairman of the Subcommittee of the Interstate and

Street.•;
i

^CHICAGO,, ILL.

curities

serving in the U. S. Army.

(Special " to The Financial Chronicle).

;

FV S. Yantis &

SallevStreetv

announced

letter to the Association, were:

135 South La Salle Street

Yy '

Chicago 3, III.

•»'

STERLING

Correction: *rK'

COMPANY, INC.

{-In the "Financial Chronicle" of
April 18, in listing members of the
Security Traders Association of
New York, who are currently in¬

Co m mon Stock

v
Y-

HI-'J

& Sketches" in "STANY,"' the or¬
|Co, as of May 2nd and will make ganization's magazine, it was in¬
his headquarters in the firm's of¬

dicated

fice at 135 South La Salle Street.

was

that

Murray

--«•

Circular

Request

Mr;;

Barysh

partner

☆

Ernst & Co.,-120 Broadway, New

• -

Graham, Bankers Bond Co., Louisville, Ky.* President,.
Dotts, Boren & Co., Philadelphia,. Vice Chairmanrof the
Mifnicipal Committee, and Mr. Kingsbury, represented the NSTA.
Thomas

■:

ADAMS &.CO
SOUTH

231

Y
V

the removal

TELETYPE

361

our offices

■./'

of the meeting," Mr. Kingsbury reported, "was for
interested in .the
Boren Bill, and with those views to bring the matter up for a vote
"before the whole -commitee.
We feel that favorable progress was
made despite the fact that two of the three known opponents to the
Boren Bill are members Of the Subcommittee.
Mr. Brownell was

•

Vi'- :

tele+

Please

■

phone and teletype nufnben

note

out
-

new
v

MEMBERS

NEW

YORK STOCK EXCHANGE

CHICAGO-STOCK EXCHANGE

NEW

YORK

i-A

i.v1

rVI'

"^.Y
JOHN

,f; isU

/
y

EVANS SPALDING

YY'

;

SECURITIES

Koehring Co.~ !/:/'YYYi

Nekoosa-Edwards Paper Co.

--t"1

*Prospectus available upon request..'/ '

I..-. Central Paper Co., Com,> Y; vY
|

Cons.'Water Pwr.

Wisconsin Power and Light Co.

;

and Paper Co.

Compo Shoe Mach. Co.'-

DOYLE, O'CONNOR & CO.

1,.

ALBERT J.

;■?+ ^

Telephone: Dearborn 6161

Teletype: CG 1200

•t

■

■•

•

*• i'

■

CHICAGO 4

PAYNE

;

So. La Salle St.

431

) A

Dearborn

1501

Teletype CG 955

'..i

Macfadden. Publications

Weyenberg Shoe Mfg. Co.
Tool

National

Co.

;
,y

GisFiolt Machine

All Wisconsin Issues

Northern "Paper Mills Co.

Froedtert Grain & Malt. Co.
"Hamilton vMfg. Co.
James

Manufacturing Co.

■

I0LLEY, DAYTON & GERNO
**

Member—Chicago

105 So.

135 SOUTH LA SALLE STREET
:

vj-'/j.

'"Y'Y,•••
'

COMSTOCK & CO.

.'jy
rt 1

f CHICAGO 3. ILLINOIS

A'/

INCORPORATED

•

'/j.f, ■/.

'JLL

THE

.COMMON

Light Co.

Trailmobile Company

■

CONTINUOUS INTEREST IN:

Y'.w'

Y :

Puget Sound Power

rYY- *

Chicago, April 24,1946

UTILITIES COMMON

INDUSTRIES

Y,Y

Resident Partners

O'BRIEN lit

■?; ^

-o.'

HALL! GRAFTERS

PUBUCKER

Kropp Forge Co.

STREET

WALL

definitely against any control of the issu¬
trading in municipal bonds by a Federal agency. ' •
* z*.

MIDLAND REALIZATION COMMON

Inc.

Hydraulic Press Mfg. Co.

bers of the board are very

Industries,

'•>

board to pass a resolution! We have obtained two recently and
Lope to have a .number of additional onfes within the next two weeks.
When the Boren Bill is explained to the boards, we have found no
trouble in getting a resolution, and have found that all of the mem¬

ing

MIDLAND

CHICAGO BOARD OF TRADE

OFFICE:

Miller Manufacturing .Co.

SUGAk EXCHANGE

' '

Howard

;

•

NEW YORK CURB (ASSOCIATE)

,yr.

NEW VORK COFFEE &
-

."*'

■'

JOHN J. O'BRIEN & CD.

practical suggestion as to how to work, here is whatwe
in Louisiana: At each bond sale we are risking" the govern¬

*
i

Teletype CG-22

>"Now is the time for every member of our association to increase
efforts in having municipalities, counties and districts,-public
and public officials- write endorsements for the Boren Bill
«nd see that copies of such endorsements are forwarded to all memY Iters of the Interstate and Foreign Commerce Committee, particularly
to Mr. Clarence F. Lea, Chairman.
We have previously furnished you
-With a list of members of the commitee and a list was published in
the March 30 (page 43) issue of The-Bond Buyer (Weekly Edition).-

■

Appleton Manufacturing

Tefeplione RANdolph 8161'

bodies

ance or

Corp.

-•

--vr

)

<■.

■

Company >->Y ,;Y YaY

*>/■}

•
■

!*, i
Lis

Lai Salle Street

Suite 1100

emphatic in his belief that the SEC had the power, under existing
laws, to regulate trading in municipal bonds in the secondary market.

J<As

PHONE STATE 010!

Aeronca Aircraft
'f'

209 South

IY,_ "The purpose

£re doing

SALLE STREET

CHICAGO 4, ILLINOIS

A nnounctng

the Subcommittee to obtain the -views of all persons

Barysh

associated with P. F. Fox &

Co.

He'has been associated with Glore,

The Securities and Exchange Commission was represented by GrinsOn
Furcell-and others,-but Mr. Purcell-was the Only one. to. speak; for
that body.
;y Y "1" -YY;; ,'Y:<—,:

•.

"Thumbnail

the

cluded s in

change firm of Glore, Forgan

.'Russell

;

CG 28

——-

Tele.

Tel.* STAte 4950

was

/ *'

•

YY 1*
- j
Forgan & Co. iri charge of the York Cityr and is in charge of the
(
Representatives of the Investment Bankers Association, The (trading department in Chicago". * .trading departrpent. " f
American Bar Association,' Municipal Finance Officers' Association,
•v.
"
'■
'■■■■■:
i Director of Finance of the City of Dayton, Ohio, American Municipal
■'Association, David M. Wood representing various states and muniicipalities.
The Municipal Bond Club of New York, The Securities
5md Exchange Commission, and the NSTA.- *,/
in

KITCHEN & CO.

Dwight

YyYY

ship in the New York Stock Ex¬

^Foreign CommercecCpmmittee o£^the"'-,H^^:'iof:'r Representatives, a
^meeting, was held in Washington, D. C., before that committee, Wed¬
nesday, March 27, to discuss the Boren Bill.
Those in attendance,
in addition to Members of the Subcommittee," Mr. Kingsbury states

'•

•

MOTOR TRUCK

Pope to Be

1 .CHICAGO, ILL. — James W.
Pope will be admitted to partner¬
Kingsbury

Investors, Inc.

Member- corporation

Ifilorei Forgaii Parinert
YYYIt J. W.

—

Committee, it

today.

James W.

Pacific-American

membership,- City Securi¬
ties'Corp.' becomes the thirtieth
of the Exchange.
•

■

.
v\

MARKET

.......

son

Co* 135 South La
'

{ With the election of Mr. Peter¬

associated with

TRADING
*

...

President'of City Se¬

Executive

the

CHICAGO, ILL:—Frank E. Peahas become

Albert

Corp. ; of - ; Indianapolis,
Ind., was elected to membership
in the Chicago Stock Exchange by

Co.; 135 South La Salle -Street,

pock

Of Chicago Stock Exch.

Peterson,

ILL. —Henry

Halsey, Stuart & Co. \:Y

JPelton has rejoined F. S. Moseley

and

III,

COMMON

Co.,. 135 South La Salle
Y-

Y! CHICAGO, r ILL.: — Robert

after

Spalding

O'Brien

J. D. Peterson Member

(Special to /The Financtal Chronicle)

Evans

John J.

are

Payne.

City, members of the
Prior
to serving in the U. St Navy, from
which he was recently released,
Mr. Meers was with the Chicago
office of 'Harriman Ripley & Co.

Y with
-Y Yi a

CHICAGO,

Chronicle)

New York Stock Exchange.

formerly

was;

the firm

The Financial

South

Salle Street. Resident partners

New .York

Fred

Fairman & Co.* 208 South La Salle
Street.

Street, after

231

years

Meers has become associated with

!' CHICAGO, ILL,—James T. Calten has joined the staff of Mason.

f. JJ

several

White, Weld & Co., 40 Wall Street,

ILL.—Anthony

(Special

!
;

Chronicle)

Financial

CHICAGO,
D'Alberti

■

Rache & Co., 135 South La Salle

J. W. Kingsbury, Kingsbury & Alvis, New Orleans, La., Chairman
Moran
of the Municipal Bond Committee of the NSTA, reports that at the

Thomas Graham

the

Exchange and

■

While, Weld & Ce.

Howard

—

;

Russell M. Dotts

■

Chicago Personnels Henry W. Meers With

•

Stock

ACTION ON BOREN BILL

York

members

at 209 South LaSalle

Thomas

Graham, Bankers Bond Co.j as
President of the NSTA.
From present indications, the. Officers and
'Executive Council will be w£U. represented.
Y
as

ILL. —John J.

Co.,

over the

limited number if reservations

New

Spring Frolic on Fri¬
day, May 17, at the Kentucky Hotel for members, their wives, and
guests, cocktails, dinner, etc. will be the order of the evening and
arrangements are being made to entertain the out-of-town guests at
Churchill Downs for the final day of the spring racing on Saturday,
May 18. All members of the NSTA are cordially invited./ Hotel
,

O'Brien

other principal stock and com¬
record-breaking crowd of over 1,700 security
country aire expected to attend, Mr. Mayer modity exchanges, are now occu¬
tetated.^^v.;''/v^:.,/■■/■r. Y?;
"■' Y pying new quarters in Suite 1100

ments

CHICAGO,

,f Reservations; for the, 10th Annujal Dinner of the Security Traders

;;

Association of New York to be held at the Hotel Waldorf-Astoria

BOND CLUB OF LOUISVILLE

John J. O'Brien & Co*

Membtfs Chicago Stock Exchange '

225 EAST MASON ST.

Stock Exchange

La Salle St.,- Chicago 3, 111.
Central

262

0780

Offices in Wisconsin

MILWAUKEE (2), WIS.

PHONES—Daly 5392 Chicago: State 0933

....

Teletype MI 488

Eau Claire

Fond du Lac

Madison

La Crosse

Wausau

a AK-

K; aw I TMJ/OO m

2224

Decedent's E Bonds

May Be Held by
i 870—7th Avenue Bonds
«>

Example Analysis of :
Prices

as an

arises

naturally

whether

tion of part
when we recommended Park Central Hotel interest.
(870—7th Ave. 4V2S) in this column at a price of 38, some of
3 Tne fact, according to an opin¬
our friends thought we were opti-f^
ion received from the Federal Re¬
Present Capitalization
rriistic when we said that we be¬
serve Bank of New York, is that
lieved the bonds were worth par. First Mortgage
$ 896,619 in the case of E Bonds left to a
When we further stated that we Bond Issue
4,055,200 trust the 'bonds need not be re¬
,

thought that the stock which ac¬
Total Funded Debt_>_$4,951,819

turity the trustees

may

make some

chased at 15.

However, we still feel that there
still

for

room

appreciation in

securities for this reason: In

the

reorganization the bonds were cut
in half and we now have a

less

debt

funded

than one-half

the

original debt of the property viz.:

Oppose Loan to China

there was also 3 corporate
of 25,000 shares of pre¬
ferred stock and 25,000 shares of
common stock: We, therefore, as¬
sume that the property must have
originally cost over $11,000,000.
Today's market places a value
on the bonds with stock of $5,271,500. Add to this the first mortgage
debt,

stock

$896,000

value

and

arrive

of $6,167,500,

WASHINGTON, April 24—Rep¬
resentative' Sabath
today
an¬
nounces opposition to any loan to
,

China until

let entitled "The Future Outlook

Industry" issued by

The

the American Hotel Association of

REAL ESTATE

221

West 57th

In this

SECURITIES

will

above

pay

prevailing bid prices
and in some instances

■j4

jtf* above prevailing offering prices for cerblocks 3 of ;

& tain

unlisted

lected

se-

real

securities.

estate

Street, New York.

and

booklet, using the Hotel

Yorker

Bell

Dlgby 4-4950

Teletype NY 1-953

the moderate

Chinese

The 2,200 business organizations in the membership of the United
Chamber of Commerce are a cross section of all business—

States

earning
would appear that
an

(However,

Congress¬

of Mackubin, Legg &

further appreciation in

of its securities.

Co.

son;

godfather.

Rejoins Doremus

being

the Army Air

that

Forces Photo Inter¬

rejoined Doremus

has

Co., 120 Broadway, New York

City, advertising agency, as an as¬
sistant

the. value

account

executive in the

New York office.

it's

adding to it.

Rather, what I would like to do
is to give you briefly the thinking
of the Board of Directors of the

"•A

Currency

Real Estate Securities

similar

before

helpful to
at all
times, when

HAnover 2-8970

Teletype NY 1-1203

Seligman, Lubetkin & Co.
Incorporated

^^
Members New York Security Dealers Association

HAnover 2-2100

Broad Street, New York 4

nothing
than

our

the

our

field day to our oppo¬
we're facing another

situation beginning today
Senate Banking and

the

legal restrictions, to do a good job
on a task that is innately unpopu¬
lar, in the face of constant pres¬

heads
wall.

sures

from all

sides, we're grateful

and we'd like your

active support.

If you're inclined to be

learned

grin

to agree that we're doing all that
is ' humanly possible, within; our

to think we're

and

short

but hectic history

intolerant;

bunch of bureau¬

crats, just making jobs for our¬
selves, that we're hindering a re¬
turn to normal, peacetime opera-

Geoffrey Baker

has it been as
*An

important to explain what we're
doing and why. The recent House
Banking and Currency Committee
hearings
on
extension of the
Emergency Price Control
w
'

fore

address

the

by Mr. Baker be¬

Controllers

Institute

Beacon Hotel 2-4/58

Broadway New St. 3/61

Estate

suggest

Act have
Li

Interesting

Among those we believe tcr be par¬
the following^
f;

Commodore

Broadway 4V2/58

Hotel

Copies of our statistical
Ask

J. S. Strauss & Co.

155 Montgomery
Tele.

St., San Francisco 4
EXbrooIf 1285

Y/v Hotel

Com.

Statler Co.

HELP WANTED

•

POSITIONS WANTED

Savoy Plaza Class "A"

memos

;

will be sent

request.

OTHER CLASSIFIED ADS

for List C21

Amott, Baker & Co.,
.

•

''"U1

Vf,i h d.

Roosevelt Hotel NY Com.

870 Seventh Ave. Corp. Com.

Westinghonse Bldg. 4/48

Hotels SLatlei' Co. Com.T.
N.

Hotel, Inc. Com.

Lexington, Inc. Com.

Hotel Waldorf Astoria Corp. Com.

Poli New England Theatre 5/83

F; OR

foil

are

Brunswick Site Co. Com.

165

special consideration at this time; of Real

Equity S tocks.

ticularly

150 Broadway
Tel.

BArclay 7-2360

Incorporated

SEE, INSIDE BACK COVER

New York 7, N. Y.
Teletype NY 1-588

V. :>

■

America, New York City, April
15, 1946.
\
(Continued on page 2254)

V? J- ■

rR$AL ESTATE EQUITY STOCKS yv

Offerings Wanted:

•

Currency Committee. As for you,
if you're inclined to be tolerant;

would like
do

we've

1929

afforded

nents—and

and try to

Never before

;:v/;

2252)

on page

have

courte¬

bear it.

New York 6, N. Y.

(

(Continued

But, after four
years of that
kind of thing,

Broadway

by Dr. Schmidt
Senate; Banking and
Committee, April 24,

1946.

everyone

the

dog's life these days in OPA. One of the difficulties ia
public servant, even though a temporary one, is the fact

ous

SPECIALISTS

statement

before

beat

Since

and

gained by

K. Emmet Brad¬

better

Members New York Security Dealers Assn.

little

of getting oat as fast as is consistent with stabilization,
price; control is stifling production and not pre*
venting inflationary pressures/ Maintains OPA prepared before
V-J Day and has since executed new price stanadards and tech¬
niques designed to implement; reconversion/ and that its present
decontrol actions are based on following tests: (1) commodity does
not enter significantly into cost-of-living or business costs; (2) con'
tinued control would involve disproportionate administrative diffi¬
culties; (3) decontrol does not divert materials and manpower so
that it would impair retained price controls.
3Qu¬

David Bradley Jones,

Offerings Wanted

L. i. GOLDWATER & CO

Mr. Baker denies

Stocks & Bonds

would

the purpose

Henry L. Brown, recently re¬
turned from' Okinawa where he
served as a First Lieutenant in

REAL ESTATE

You

there

Asserting the OPA is approaching decontrol aggressively and with

David JoneS of the trading de¬

pretation,

reasonable to expect

seem

that record

have

laws.

By GEOFFREY BAKER*

Brown

ex¬

standpoint, the property is
probably not worth this much.
(Property is assessed at $6,725,000.): Yet, by combining earning
power plus reproduction costs, it
would

The OPA's Conbol Policy

liberal

other

ley will/be the baby's

in¬

from- an

E. P* Schmidt

standpoint it
an $11,000,000

the hotel is not

Dr.

whole.
In addition, it is
always our intent to study sub¬
jects of great concern to the whole
country from the viewpoint of
their
bearing
on
the national
economy as a whole.
It is a well
established slogan of the National
Chamber that what is in the pubas

earned about 15.91% on its bonds.

From

bearing
business

upon

with

price control. Others
will appear before this Commit¬
tee. They have presented or will
present numerous examples of the
hardships and difficulties imposed
on them by those responsible for
administering our price control
respect

lems from the

their

recommendation

and

ence

The

various

peared before Congressional Com¬
mittees to present their experi¬

Chamber,
therefore, ap¬
proaches
all
national prob¬
viewpoint

from

lines of business have already ap¬

and communi¬
cation.

in the interest

witnesses

Many

finance,
insurance,
construction,
agriculture,
foreign trade,
transportation
ing,

was addressed
Congressman Sabath

born last week;

income of $3,649,000,

gross

interest

lie

business.

New Issue for David Jones

1945, the Park Central Hotel,
a

wholesaling,

cablegram

ten

ond

with

ailing,

ret

manufactur¬

Deputy Administrator for Price. OPA

rates
In

policy under continued

$ chooses to deal with symptoms instead of causes. Recommends
van immediate investigation for a coordinated decontrol program.

737,330. This figures about 32%
partment of Mackubin, Legg &
higher. They further state that be¬
Co., 22 Light Street, Baltimore,
cause of this extra cost, the new
Md. is the happy father of a sec¬
hotel would have to charge higher

cessive.

40 EXCHANGE PL., N.Y.

much of inflationary pressure to high wage

example, the

trinsic

Member* New York Slock Exchange
Member* New York Curb Exchange

;

men.

Yorker would cost $21,934,030 in¬
stead of that hotel's cost of $17,~

valuation

SHASKAN & CO.

jointly

Association points out that a new
hotel exactly similar to the New

WANTED
We

New

established.

been

Democratic League addressed to
Congressman A. J. Sabath and
other leaders of the Congressional
Committee to Win the Peace.
■

interesting copyrighted book¬

of The Hotel

firm coalition gov¬

Objection to the use to which sur¬
plus American arms and equip¬
ment in China
have been put
and criticism of transportation of
nationalist
troops by
American
forces coupled with a strong plea
for peace and unity were con¬
tained in a long telegram from

still only
55 % of the estimated original cost
of the property.
Now
the
question arises of
whether the property is still worth leaders

very

has

ernment

its original cost. Along these lines,
We would recommend reading a

BLOCKS OF

are

Total Funded Debt-$10,878,103

In addition to the prginal funded

•

;

At ma¬
merely re¬

quired to present the bonds for
payment, with a certified copy of
the final accounting of the execu¬
tors and make written request for
payment.
V/';;;

Original Capitalization

people hesitate, especially after
realizing that in 1942 the same
securities could have been pur¬

appear to be progressing toward decontrol"
under present Government policies, Chamber of Commerce economist contends OP A both retards and distorts production.
Lays

deemed before maturity.

thought we' were really over- First Mortgages
$ 8,500,000
optimistic. Today the bonds are Second Mortgages
2,000,000
91 bid, the stock 18 bid and the
Notes'.' —3
378,103
bonds with stock 127 bid.

3 ;This 127 bid

Chamber of Commerce of the United States

3 price control, and contends Administration has taken too narrow a 3-?
view of price-and-cost-making process.
Criticizes fiscal policy as
of the. accrued full
'
also inflationary and says it will continue so as long as Government
/,

Just three years ago,

:•

SCHMIDT*

maturity would, of course, involve

bonds

companied the bonds free, would
also have a value some day, they

Thursday, April 25, 1946

considerable penalty in a depriva¬

or
'

!; 1');' ■'■

Stating that "we do not

his assets in
redemption before

Such

trust.

justified

prices are

today's

not

case

decedent ; willing

Hind-sight has proven that the prices at which real estate secur¬
ities Sold several years ago were foolish indeed.
The question now

the

•

Director, Department of Economic Research,

•/"V

must be redeemed in

■:«- VI;:; ? i1Mt.

Price Control?

EMERSON

professional and lay public is un¬
der a misapprehension in believ¬
ing that Series E Savings Bonds

Present Real Estate Security

Trust

4 f•"

:33

Inflation Control

segment of the

considerable

•

$•'»!

;

THE COMMERCIAL & FINANCIAL CHRONICLE

Volume 163
!>fvi

2225

THE COMMERCIAL & FINANCIAL CHRONICLE

Number 4484

t.i'J

r,'

J / J

ay; v,

Howard Allen Dir. of
f:.

;;44;'v.■ •;,',4 '4.'y4 4AUSTIN WHITE

4 :,^;,/4 4'M ;"4 4; .v|.

Ohio Brevities

Albert Frank Agency I

;

composed of Fahey, Clark & Co. of Cleveland,

v An Ohio group

praun, Bosworth & Co, of Toledo and the Ohio Co, of Columbufs,
From country banks all over Ohio come reports of an increased
offered a total of $720,000 of Vi\% bonds, of the Painesville (Op
dent and Account Executive of
demand for local loans.
Seemingly this demand for loans has been
School District at prices to yield from 0.50% on shorter maturities
Albert Frank-Guenther Law, Inc.;
steady since winter and, from reports we pick up, it appears to be
to 1.10% on the longer term bonds.
1
growing more general,
The group, headed by. Braun, Bosworth, was awarded the bonds
on
a
net
interest cost bid
of^
/ This lending activity has admittedly not reached silch propor¬
Cleveland, New
Orleans and
1.072%.
The second high bid,
tions that the country bankers are bragging about the, amount of
Miami and adidtional breweries
made by First National Bank of
444"
4"'o
their loans>
will be sought, and eventually,
Chicago, figured a net cost of
one
bank loses will, at least
The loan port¬
distributing Regal on a national
1.075%,"; 44:;,.• :44':V:4sv/4;:4 4^
folios of most /largely, be another bank's gain.
scale,
Proceeds from the bonds, which
Some other bank will own the
banks have
Other
Officers
elected
were
mature serially from 1947 to 1966,
securities that arebeing paid?
dwindled 4 in
MM:'will be used for additions and re¬ Henry F. Adams, Vice-President
and will thus have mdre cash,;
recent years to
modeling to the Painesville * high in charge of southern Ohio and
or
else the customer of some;
such
small
the
Cincinnati area;
school and four grade schools.
and Viceother
bank1
will
have
such
proportions

Allen,

Howard Ci

Vice-Presi¬

that

securities and will

'they

even

fold

many

cases

before

the

banker

could
with

total

are

aged

over

obviously quite

that to the extent that the Federal
own

encour¬

the fact that the totals

-are

bonds, at least

not

municipal bonds,

the

extent the commerical banks

re¬

■'4 ;(Continued

sult of this loan demand. How¬
ever, this ability to lend money
again has quite naturally caused

Ohio

5; some bankers to be less anxious
•

on page

r
•

to grow, . nor
whether it will reach aggressive "

and sizable proportions, and, of

142

Apr.

142

Apr.

Mar. 27

—

.98 :4 .27
4 .98 44.27

1.25;
•

1.25

143

1.26-

143

1.26

y .99
4 .99

1.26

■y

■U. 143

Feb.

^ 146

1.30

1.02

Jan.

1.24

1.39

1.09

Dec.

1.13
1.15

Oct.

'1.36

1.54

1.18

; of a few bank ers who are not so

Sep.

keen for buying municipals at

Aug. 17
July 18

definitely

June 13

Everybody
war

May 16
18

billions of dollars of the
war

loan deposits. But it has been sur¬

Feb.

Jan.

.1.58.
1.62 s

1.17

1.42

1.02

1.21

1.39

1.19

1.35

1.02

1.19

1.34 Yj

1.03

—

Mar. 14

knows, I of course,
loan accounts "of all

Government debt with these

—

„

1.18

1.38

1.40
1.22

—

Apr.

ac¬

banks are being cut down in the
Treasury's program of paying off
several

—

1.27

.30

AY. 32

V .35
>.36

•

.33

•

1.43

1.11

.32

1.14

.33

1.33

1.49

1.17

1,1945-

1.34

1.50

1.18

1,1944— 1.41
1,1943— 1.83

1.58

1.23

2.01 v

1.65

.32

.32
-.35•

—36

2.13 •;

1.70

U .43

2.14

1.62

.52

Jan.;.' 1,1940-j, 2.30
1,1939— 2.78

2.58

2.01

Jan.

3.42 -

;

3.33

Jan.

1, 1938— 2.98

(or

;

2.24
2.55

1.09
•

.87

bonds.

tlC

between high grade and lowej
grade bonds. *
Foregoing data, compiled by J. A. Whit*

owned

the

issues

which the Treasury is paying off.
Some

such

country bankers
been squeezed for

have actually
cash because the Government has
been taking worthwhile amounts
out of the banks to pay off issues

grade bonds. 410 higher grade bonds

SSpread

& Co.. Cincinnati.

„

:<->

such

the banks have ac¬
tually had to give up as much in
cash

cases,

the

Governrrvent

ing upon from the
count.

war

was

call¬

loan

ac¬

•

it is

only to be expected that a banker
would not be an avid buyer of,
municipals. It has been interesting
to

however,

note,

that, at

least

have noticed no desire to sell

municipals
tions.

even

such

condi¬

bonds, i Officers

y3-"'-

Own Investment Firm
&

livan

Co., has

The

House

of,

business

Walton

offices

at { 509

Louisiana

this said:
"Mr.

Herbert Dittus Withy

municipals..

Edw. G.

Taylor & Co. 4

•

Burgin,

present session.

^"He entered public life>in 1910
when;; he was elected,; Mayor. of
Thomasville, N. C, He was elected
to

the

Carolina

North

Representatives for

House

single term

in 1930 and tb the State Senate in

1932.

was

engaged

•;

Browns, American League ball
club, was elected executive VicePresident of the City Ice & Fuel
Co,
at
the annual > meeting v in
William
was

Democrat, had

the

banking and mercantile business
in Lexington. He was a native of

Sinek

•

Chicago;

reelected to his fourth

term

President.

the

duce

pro¬

company's Regal brand
in Cleveland the
of
May.
It has 'been

of beer, starting

middle

manufactured in New Orleans for
57

years

and other Southern and

Western plants. The company
continue

will
produce its P», O. C,

brand,
The company brewery facil¬
ities

are

expanded

:Y-'

Co., has been chosen President of
the Pressed Metal Institute.'

Other

include:

officers

new:

Carter C. Higgins, Vice-President
Worcester Pressed Steel Co.,

Vice-President; J. J, Boehm, Presf
ident of Boehm Pressed Steel,Co.';
Secretary-Treasurer, and Tom J;
Smith Jr., Executive Vice-Prqsi^

4-v;,r''t

Otis

Cleveland,

Co.,

underwriters

the

•

heads

will

that

-I'-1''

offeij:

130,000 shares of $1 par vail
ue common stock of L'Aiglon Ap¬
parel
Inc., . Philadelphia.
The
soon

(Continued

2258)

on page

;

Ball, Burge & Kraus

Add Ussher & Shorsher
CLEVELAND, OHIO—Two forf
mer' Air Corps officers' have bet
come associated -with Ball, Burge
Si

Kraus, Union Commerce Build?

ing.

announced plans to

Sinek

4/:'

Clevelander,
Clarence
W,
of
American Stamping

Mucker man, Presi¬
dent and owner of the St. Louis

Cleveland last week.

Richard

{

They are David M. Ussher, Jr.|
served as a Major with the
Eighth Air Force in England, and
Fred
A.
Shorsher, who was $
bomber pilotwith " the rank of
Captain.
Mr. Ussher was an un?
v

who

with

derwriter

ice

the serv?
formerly

Shorsher
with < J ones

Mr.

and

was "

Insurt

Travelers

Co. before entering

ance

connected

Corp. at Pitts¬
Y;;;4i::4^ -4 MM(

Laughlin

Steel

burgh. i

»:

Gruen Watch, Com.

Democrats, 191 Republicans, two
minor party members f and four
vacancies.

;

(

Correction
In the "Financial Chronicle" of

S.
43

was reported that Rog¬
Palmer had opened offices

Cedar

New York
investment
who is as¬
"Gilbert

not

open

;

Whitaker Paper

Underwriters and

Land Trust Certificates

Distributors of Municipal

Philip Carey Com.; & Pfd.

and Corporate

Securities

;

/.a;

CLEVEtAND
:

Cincinnati

New

York

Stock Exchanges—N,

Established 1899;-.;;:/;::;

New York

Globe Wernicke Com. & Pfd.

Members

(Incorporated)

;

v>V

W. D. Gradison & Co.

OTIS & CO.

his firm for
business until, after May 1.
4: ^ 1
will

Sport Products

" Denver
Toledo

Cincinnati:

Y. Curb Assoc,
;

' ^

CINCINNATI 2

•»"

Chicago
Columbus

and

(Dixie Terminal Building

Tele. CI 68 A 274

Tel. Main 4884

have

formerly with the Weil, Roth &
Irving Co. Prior thereto he was:

not

;44' v;::'

:-*3,

•

:%■'

OHIO

Wellman

Company

"'.bd

Circular

SECURITIES

r\rr>

Opens Office

place, the cash which i

Throm, member of the
Curb Exchange,: announces the opening of offices at
14 Wall Street, New York City,
NeW

York

Request

New circular

WM. J. MERICKA & CO.

request

Union Com. Bldg.'
CLEVELAND
Tele. CV 174

■Union Cent.

•

CLEVELAND 14

Bldg.

CINCINNATI

Tele. CI 15©

INCORPORATED1

Union Commerce Building

Field, Richards & Go.

Thomas

Industrial Brownhoist

Thos. Throm

Engineering

important orTasting. In

j'-vt--/ .'4

been

may

GOTTRONI^JRUSSEUA

as manager

nicipal bond business for 31 years.

municipal market^
out of the market
who

of tblc;
Mr. Dittus was!

r'«-r;

Mr. Taylor has been in the mu¬

dampening ef¬

buyers, yet the effect
the first

Building,

years.

While these developments will

be too

good prospect to buy

bankers

old,

this year that
he would retire at the end of the

Co.,

associated with Mr. Taylor'for 10

some

•

Street,
City, to engage in the
business:. Mr. Palmer,
sociated with Clinton

cash is not

taking

Representatives

67 years

■,

announced earlier

Street.

sales department.

was

ice to corporations and Organiza¬
tions by serving them in various

Co., Inc., April 18 it

Paul

the

Custer

cial bank, can round out its serv¬

The United Press vinYxeportin^

formation of, his own company to
conduct an investment securities

even a thought
selling municipals. However, of
course, a banker who is selling
Governments
to
obtain needed

eral, years.

He stated the latter proposal is
dent;
being presented so that the Union
Commerce, primarily a commerf

trust capacities.

——>

lyilliam Q. Burgin, Represen¬
He

Burgin Dies

adjourned at 11:30 a.m. on April
11, out of respect to; the memory

the

announced

ernments without

fect

in
|

also is proposing to
the date of the annual
meeting from the fourth Wednes¬
day in May to the second Wednes¬
day in January each, year, in or¬
der to conform to general bank¬
ing custom, and to remove the
existing limitation on the bank's
use of its trust powers, in order
to permit it to conduct trust com¬
pany business.
; \ ; 4
:

tic majority in the House to forty4
seven seats.
There are now 238

naturally have

I—rnrnm

i Congressman

these

William

Mr. Miller;, was
the, trading department.
'

be a foregone ''• CINCINNATI, OHIO — Herbert
days that if „a R. Dittus has become associated;
banker needs money he sells Gov¬ with Edw. G. Taylor & Cb^ St.;
seems

conclusion

are

Morton, President and Treasurer;

bank

change

with

Under such circumstances

•

His death reduces the Democra¬

Gus B, Walton Forms

'LITTLE ROCK, ARK.—Gus B.
portfolios. Naturally, in
Walton, formerly of Walton, Suit

their

The

Co.,

Marion, N. C.

which such banks have not owned
in

Incor¬
porated is being formed with ofr
fices at
15 Broad Street, New
York City, to act as underwriters
and distributors; and dealers Y in
municipal and U. S. -Government

.31

1.47

Index

Morton

1939.

1.27

Jan.

♦Composite

tative from North 'Carolina since

lower

us to note how few of
country banks around Ohio
have

Gray
Drug
Stores,
Inc.,
Of
Cleveland, formerly known > As
Weinberger's has: elected Mqrt

.40

.40
.37

prising to
to

131

.45

1.30

Jan./I, 1942—51.92*
Jan.
1, 1941— 1.88

..28

'■•

the

seem

Own Investment Firm

.27

1.02

Jan.
Jan.

; .27
f

•

.99

1.50

ity, because, of this lending
tivity.

office

1.45

that the
:

17,1946.

19,1945„. 1.29
14 ;
-.1.32

| shortening their ideas of inaturi

Apr.

Nov.

important actually to affect the

are

Yofk

New

Department.
-■A-

market for bonds. Yet we know

present, and who

the

York, of which Mr, Morton wa^
2nd Vice-President in the Bond

44 t ^

Date-

Mar. 20

: course, no one knows if the der
4 mand will become sufficiently

Howard C. Allen

Secretary. All were formerly with
the Chase National Bank of New

Municipal

Price Index

to buy municipals at - present
low - yields;
No
one
knows
whether this demand for loans

4 wilf v continue

;

••

hav^ Anthony .4 J.
Miller,: ; Assistant
2251) ,T* j Treasurer, and Ethel A.
Couper;

stockholders at the annual meet-

William Morten Forms

Louis, William A. Schmid
Rhode, both of Chicago.

St.

and F. F.

ingmy May 22 will vote, on a pro¬
posal to change the 35,300 shares
of $100 par value capital stock of Jacobs Vice-President. 1
: .• >
Cedar Street, has been elected a
the bank into 353,000 shares bf
customers receive the cash and
Jacobs, in charge: of ' sales pro¬
member of the board of directors
motion
for
the
80-store
chain,
$10 par value.
;; ' ;
deposit it to their accounts, then
of the advertising agency, it was
the commercial banks, although
has been with the company for £7
Thompson said the 10-for-I
announced April 22.
; \
:
!;
they do as a group keep all such
years. Prior to heading sales pro¬
exchange would tend to give
motion, he served for a number
cash, will have to put up more
the
shares the benefit of
a
of
cash as increased reserves against
years
as
supervisor of the
broader
market. >. The
stock
Cleveland stores of the chain. He
their increased private deposits;
currently is quoted over $500 a
also has been a director for sev¬
whereas they are not required to

climbing upward instead of
continuing to decline. Some are maintain cash reserves for war
expecting that the low; point in loan deposits of the Government,
■•bank lending has been reached / Some of the securities already
and that the, demand from cus¬ paid have of course been owned
tomers for loans will broaden and by the Federal Reserve Banks and
we understand that $400,000,000 of
even become more persistant.
:
the May 1st maturity; of Certifi¬
As yet, we have noticed ho
cates, which are all to be paid in
/
desire
on
the
part
of
any
cash,,are similarly Owned. To that
,v bankers
to sell
-

announced that bank

Cleveland,

securities paid

in cash, to that extent will the;
commercial banks generally have
tb give up cash. Moreover, if bank

Presidents Walter B. Muckerman

Thompson

the Union Bank of Commerce of

admitted, however,

Reserve Banks

Nevertheless many bankers in
practically every section of the

state

must

resources,

ratio

loans

4 J. Austin Whit^
t

point

pride" to

the

few

President

♦

deposit the

cash received.

could increase

1582

Union Commerce Bldg;

Cleveland
-

14,

Ohio

Members Cleveland Stock
..

Exshftxif*

•.

Teletype CV 594

BROADWAY

NEW YORK ♦

ifci),

2226

COMMERCIALS

THE

FINANGIAL CHRONICLE

Thursday; April 25, 1946
%

most

of the

chants

latter

Bank and Insurance Stocks
By

VAN

In the

"foreword" to

—

Insurance Stocks

low.

casualty

index represent, in
our opinion, a cross-section of the
industry. We selected both the

ket

excess

mar?

ket'

com-r

value

insurance

panics."

Federal

The results of the entire

National

New

index, multiplied by the then

outstanding shares of each of the
companies, amounted to $1,030,4
174,032, which we consider to be
100.-'

also the
stock.

represented

similar

was

were

for

the

entire

four

year

" ;

j
' ' 7/.

* 7

7 7*

"•*

•

fire

Alliance,

since May
.

■' /,

,;t

Baltimore American, since Dec.
1943. 77,7 7:
7 /

Franklin,'sipce Dec., 1943.
Home, since Dec., 1^43,
National Liberty,7 since Dec.
,.,v.Vi,v,7*
19437:7:7777 -77/7

period,

National

1944.

since

Union,

„

June.

•

Northwestern

Nat'I^ since April:
/ _■
77'-:;' 7.|
Springfield F. & M., since June,

1944.

31,

•

American Insurance

th^

1945 at 183.0. Casualty stocks,

therefore, appreciated 83%

American Reserve

7 7

Fid. & Gty; Fire
;

/were .;

' v /7

Fidelity-Phehix 7;

Fireman's Fund

and Analysis

Great American

Hanover

l$t Quarter 1946

I-/ Bank Stock&IZ
Circular

request

♦

In the

of Ins. of N.-A. and

performance dates from February
7

Laird, Bissell & Meeds

7•

• •;:'-•••

7,..

77^

••

.t \

Three

Members New York Stock Exchange

.*■

case

St. Paul, their better-than-average

-7

BROADWAY, NEW YORK 5, N. Y.
Telephone: BArclay 7-3500
BeU Teletype—NY 1-1248-49

stocks, viz.: Glens Falls'
Merchants Fire and /Providence-}
Washington,
conforrped
rather
closely with the index through

p. A. Qlbbe, Manager Trading Department)

*Mackubin, Legg and Company!

PRIMARY MARKETS IN

INCORPORATED

NEW YORK 5

BOSTON 9

Post

Off ice Square

67'Wall Street

HUBBARO°8B°

WHITEHALL

ut>-v)7

CHICAGO 4

3-0782*

231 S. XaSdlle Street
FRANKLIN 7833

£G-io$

1-2875

PRIVATE WIRE SYSTEM CONNECTING:

NEW

YORK, BOSTON. CHICAGO.

PHILADELPHIA, ST. LOUIS, LOS ANGELES

HARTFORD, Enterprise 6011

PORTLAND, Enterprise

PROVIDENCE, Enterprise 7008

precipi¬

point at issue

Underwriting and distributing practices have been" of

such

long standing that they are integrated iwith the trade
prevailing in the securities field.
,

Now there may

be certain trade customs and usages

which require modification.
the

However,
to work
7V«'«"

•;

•'/ /i:..7/7.7 i.

\ There

may

be instances where

7008

public interest demands this.
-

tributors

.7 t.V

regard

that

complete
transformation from what
»7V»'

'/'4 '

»■

"J-*'": L, :y

'*'■*">

«*••*'• :'•••/ *: j'/

•*

y'7*

the ordinary practices of underwriters and dissome

be thereafter>classifiedl

of them may

insurance

stocks.

"fraudulent, deceptive and manipulative acts," when such 7

change/is/brought into- being by

administrative body /

under its rule-making power, is to us

absolutely unthinkable*

We believe it to be wrong.

Allen & Go. Offers

We believe it contravenes the law.

Graham-Paige Debs.

7 Allen &
Co., as sole

II these, activities which the Commission seeks to taboo'
i

'•«

V'.- V

•"

7/■V7;V:r-''7

7':."7.-7..'A *:77'7'7

'•,/>* '7-

'/'

•

underwrite
er, on April 22 offered to the pub
lie" a " new
issue -of / $ 11,500,000
Graham-Paige Motors Corp. 4%
convertible debentures due April
1, 1956, at 100% and accrued ine

arein fact

terest.

in; the absence of legislative enactment fo the contrary, trade i

The

vertible into
company

debentures
common

at $13

per

; 7.

conj

are

denture

pursuant

company

pledged

America

National

stock of the

We reaffirm

ciistoms and

share. ' Th

ings Association,

Sav^

fundamental part of the law.
than

attempt

any

the part of, regulatory administrative bodies to effect

company's / Warren Avenue
property consisting of 46.5 acres
of land in Dearborn, Mich., < to¬

tra^e

The change of that part of the law which is

;

anq

the

custom'and jusage can be modified only by positive legis-,
lative enactment.

gether with the buildings and im¬
provements thereon consisting of
administration, general office anq

engineering

usages are a

;

have contended heretofore, thai 7

changes through rule-making activities.

trustee, 250,000

shares of Kaiser-Frazer stock

now as we

claims, why* this

The revision of them requires more

to which the
with Bank of
Trust

objectionable, |and the Commission is armed

With;the ipower to remedy |them,.as it
Rip Van Winkle sleep for so;long a time,

debentures are secured by an in

We, therefore,

say

that in this controversy the ball has

gci

been muffed, and that the pjace for the Commission to

buildings, factorie^
and sidings.

seeks

revision

of underwriting practices,

<
The sinking Tund'begins April Congress.
1, 1947, and provides for the pay4
ment by the corporation of 25%
for-share basis, with cash adjust-;
of net earnings of the preceding
ments in each case. Subject to the
year to be applied to the retire¬
priur rights of the preferred stock-j
ment of the debentures. They are
holders The First 7 Boston Corp,
redeemable, including fon sinking and associates offered the issue!
fund purposes, at 102^%.
/
publicly April 24 at $100 per
ivTNet proceeds frnnqL; Ihe sale oi share* Proceeds of this financing
debentures will be u&ed7by the will
be-usedy'together with the
company to the extent of $2,500,| proceeds of a proposed new issue
000 to pay in full an outstanding
of. common stock, to retire the
bank note.
Of the remainder,..th0
117,404 shares of old preferred
company. estimates that approxi¬ stock as well as serial notes out¬
mately. $8,000,000 rwilf be.expend-T standing in the afnount ■ of/$2,X
ed in connection with -the produc-f
000,000 and to provide funds, foij

construction and extension of the

the Willow Run plant. /The bal-5
ance
will/be added to working

compapy's plant, property and fa/

tion. of the^Frazer autoihobile

capital.

■.;■ -':"■

7/"/^

is fo the

Australia and New Zealand
,J rr?f.'

ir\- ;•

■

<>• .7

;

....'

BANK OF

NEW; SOUTH WALES/
.

cilities,

^:^7:77

Hampshire Pfcji

new

preferred

on a

share-

(ESTABLISHED 1817)

Paid-Up

Capital
Fund

Reserve

Liability of Prop.- 0,780,000

«—,—.—6,150,000

7
'

£8,780,000

Reserve

Aggregate Assets
; SeptM 1945

•

7.£23.7IO.ooo;

30th '

•

General Manager '"'"
Head

Office: George Street, SYDNEY'

7/77 LONDON

OFFICES:

29 Threadneedle

.7/ ; 7:'77

Street, E. C. 2

Publicly Offered

April 20.

/57:

/ /

Agency arrangements with Banks

Chain Store Investment
Com.

.s/:47 Berkeley Square, W. 1

—r-tZtt,163fiZ2.

THOMAS BAKER HEFFER/ 7 '

)

An underwriting group headed
underwriting group headed by the First Colony Corp. on Apr,
offered
to
by The First Boston jCorp. on Apr! 23
the
public 89,4
22
was
awarded at competitive
619 shares of common stock of
bidding 102,000 shares of 3.35% Chain Store Investment Corp. at
cumulative preferred stock ($100 $8.20 a share. • The offering
repre/
par) of Public Service Co. of New
septs .the-unsubscribed portion of
Hampshire on a bid which set a
an issue of 100,000 shares of addi-;
price of $100 per share for the of¬
fering to stockholders, less an ag¬ tional comon stock offered to com¬
gregate compensation for the un¬ mon stockholders of record April
derwriters of $173,400.
Present 12, 1946, at $7.70 a share at the
holders of the $6 and $5 preferred
rate of one new share for each
are
given an opportunity up to
May 6 to exchange their shares share held. The rights expired on
for the

form the

can

urn & CI.

Of New

BANK and INSURANCE STOCKS

customs and usages

First Boston Wins P4Si
:

most vital

forced to the conclusion that the

has-been fully missed.

St. Paul F..& M. /
-

Insurance of N. A.

1944.

If®

Hartford Fire

19 New York

However, in the controversy/which has been

Comparison

7" '*

Firemen's Ins.

tated, both in written and oral argument/we have been

made// by

yixij

;/*7: The merits or demerits of such practices
subject of a distinct editorial.
7
7
;

July

(capital

Casualty

both sides."

7': However, our present thesis does not require that we
pass upon the instant practices which the Commission con¬
demns and seeks to remedy by the proposed rule.

and railroad spurs

.Continental .Fire

froni

(since

"There >is

Sir Roger de Coverly says:

|.'7;

j'/. \
j

...

Casualty,

;

7'Now, ;theh,

much to be said

7777 i
;7

Fidelity & Deposit

student of

year

Automobile, since Dec., 1943.

com-

April 1942, and closed

f /T

misleading,

are

practices are contrary to accepted business ethics
and against the public interest because they contribute tp
the disorderly marketing of new securities and deceive and
mislead the investing public.:
7:
7
:
r
7 !

all, this, study is most
interesting and should prove of
inestimable help to the careful

1945. '1944..
j
Thus, the fire index appreciated
U. S. Fire, since Nov., 1943.
J
The following twelve fire
29% from 12/31/41 and 54.5%
stocks,
from the 1942 low. The casualty* quite consistently, kept ahead of
the index throughout the period:
index, starting with i00, droppe4
91.0 in

Am. Surety

All

;

•

American

■

December

7
7

Casualty

Reinsurance

7 The "Commission* claims that the$e acts

and the

index

crease), Employers (Reinsurance,
Excess Insurance, Fireman's: Fund
Indemnity and Maryland Casualty.

SiiS

$|f|

1943.

casualty.

Am.

American

stocks, which; per-f
formed better than the index, dur+
ing the early part of the period
but have
lagged behind in the
latter, part, are. as follows:-—

fire

129.0

[

casualty

ently lagged behind the
throughout the four years:

performances,

77:77 7

Eleven

index, starting with
100 on December 31, 1941 dropped
to 83.5 in April 1942, and finished
at

„

1945); New Amsterdam and U. S:.
Fidelity & Guaranty. Pacific In¬
demnity and Standard Accident
followed the index fairly closely,

.Westchester
•

graph made* for each indi¬
vidual stock compared' with its
respective composite index, eithetf
The

the

especially the former. Very erratic

Republic

fire

practices in the category of "fraudulent^ deceptive and
manipulative acts."
»
' 7
1 7
J
J
!

Universal Ins.

puted at the close of each month
and

case

;■

these

stocks, their performance has been
generally more erratic than; the
fire stocks, and somewhat piord
difficult to classify. However, the
following ten have rather consist¬

National

Reinsurance Corp.

computed, and

indices

7 7

Phoenix".

index of each individual

These

Paul Revere

the

manner

■

/•/'

•

Pacific Fire

ket bid prices. As of December
31;
1941 the bid prices of each of the
57 fire companies comprising our

casualty index

i#-

Hampshire

Northern

the index is computed, as follows:
"The index is computed on mar4

Fire

New York

lo quote from the "foreword" how

and

that thd

& M.

North River

stocks compared with that of the
21 casualty stocks. It is pertinent

base

insurance

New Brunswick

study

depicted in a series of charts,
starting with a chart showing the
composite index of the 57 fire

our

fire

the

Aetna
mar¬

Homestead/
% Jersey

are

fire

■

••

Gibralter F.

the

(Continued from page 2215)

pronounced effect upon the

f§ Muffing the Ball

more conserva¬

dividend policy and
factors, all of which have a

the charts show

tive in their

other

.-■•V

Security Insurance.

interest

action

half

following lagged rather consist?
.General Reinsurance
ently and substantially behind the
Hartford S. B.
composite' index of the 57 fir^
Mass. Bonding
stocks during the entire four year
Preferred 'Accident;:
77
^
period:—
7/7
7/ Seaboard Surety
Aetna Insurance
7 U. S.' Guarantee 7/*
^
;
.'■•■'7 7
Agricultural Ins. 7
i
J
Stocks /which have/ kept weljl
Bankers & Shippers
•_
;
.
ahead of the index are: Contin¬
City of New * York
ental Casualty (since Oct. 1944);

underwriting profits
and those showing substantial un¬
derwriting losses; the companies
selling above liquidating values
and ..those selling below liquidat¬
ing values; also companies paying
in

;•

considering the relative

stocks,

substantial

dividends

.In

large companies and the small
companies; the companies showing

earnings and those

'//////I

———-

12/31/41 and 101% from the 1942;

selected both for the fire index

and

.yyv>:,/:/ 7: 7 //./r/; '7V-

the study »

the author states: The companies
we

the
of 1945. Very erratid

Globe & Rut¬
gers, Merchants & Manufacturers,
Northeastern (former Rossia) and

DEUSENi

always pleasant to be able to compliment someone for a
job well done.
This column takes pleasure, therefore, in.compli-i
meriting a :!:stock exchange house in Baltimore on an excellent study,
recently released, of the comparative market performance of 57 fire
insurance stocks and 21 casualty stocks, between the dates of Dec. 31;
1941, and Dec. 31, 1945.

spurt in

performance was made- by Amerii
can
Equitable, FireV Asociation-

period, though Mer¬
quite

Globe & Republic,

This Week

}

had

throughout the U. 8. A.

:/;:7rv

NATIONAL BANK
of INDIA, LIMITED
Bankers

the Government

Kenya Colony and Uganda
T

Head

•

Office:
1

26, Bishopsgate,
London, E.-C.

Branches In India, Burma, Ceylon, Kenya
Colony and.Aden and Zanzibar
...

(

Subscribed Capital

£4,000,000

Paid-Up Capital

£2,000,000 >"
£2,200,000 '■

Reserve
The

Fund__

Bank

conducts
every
description
banking and exchange business

Trusteeships and Executorships
also undertaken

•

3 THE COMMERCIAL &

Volume 163:r Number 4484

been
''

•••

"Oitr
•

.,33't

4' *;Vi'

Reporter

» "f ■!'

}'•''(.•> V f.1;

«v,_-

)

.»,-■*

■. ■ ,

■

CHIPPENDALE, JR.

By JOHN T.

motion

price

poor^-ieehmpal^ f£Qndit^r£^
of

this

changed / policy

the

short-term % obliga¬

the

•

new

J"v'

♦

■'

■

-'.

of the;'

member

;

Bedford

1912, died Tuesday at the North1
Westchester Hospital, Mount Kis~.

go to a

.brief illness;'; His age
For many years he had

after

co,

59.

was

senior partner of Herz¬

been the

feld
firm

Stern,

Stock Exchange
1880 by his far¬

founded

ther,Felix Herzfeld.
.....
•" Mr.
Herzfeld attended Williams
College and .during the' Work!;
War I served in the United States

I&vy,.

(carry/top much farther.

market experts

buying

ters, Mrs. Elsa H. Naumburg

'3/' >/v•'/; -33-;3'

his widow, Ethel

Services will be held at Camp¬

;:j

Madison

PajrJor,

Funeral

bell's

Street, nn

Avenue at Eighty-first

For instance the l3/i% due Junel5/ 1948, the 2% dueI949/,51,'
the 2% due 1950/52, the I Vs^) dub 1950, "the ^% ' due fpm 1951/53
through 1952/54,' all made new tops after the Treasury's, first an-,

Whiting &; McCarthy

William

;.peter'31- Nassau
Street, New York City, announces

[ '•>: (Speciftl. to. .The

and

Mr£; Max Reichenbach,-*

and shrewd traders that the market is now in a-

range.-•. y

are

;>'. •/ Fitrfienry Herzfeld, and two sis¬

-»

Surviving

>_ Therefore, it is being advised that scale orders to purchase
needed obligations be entered, since it is the opinion of money

v sure
as
non-bank investors liquidated these securities to gert
•'/. funds to put 4o work in the longer-term restricted obligations....
After the initial weakness in the short-term and intermediate
; maturities, these issues, rallied and several of themwpnttp jiew'

Stock Exchange sincd!

York

New

Government bond market will pot

also under pres-

The eligible issues due through 1952 were

•

Herzfeld

Village, N. Y.,

/;'3V"'
.

-vV-v-*//>/ i

■'

the better competitive positipn of

...

"".V /

/■ 1

Walter Herzfeld Dead
Walter

There is one thing that must be remembered in the money
markets and this is that the Treasury will not allow the debt burden
to increase.
This would seem to indicate that the decline in the

securities moved
the-shorter-

especially the bank eligible obligations. .„VThese
term, obligations.

down in price.to meet

'> ' ■>/;'-'3

IN BUYING

yields, i ;
The next group to be influenced by
developments were the obligations maturing through 1950,

minor increase in

-3-

felt

was

particularly, the jcertificates ibsfcindebtedness,

tions,

declines

limit
..

the

of debt retirement, which has had farthe Government securities markets. ... These
taken place on light volume due to the

changes ,have

yield basis very far away
from that presently-prevailing.
I
Life insurance companies apd
savings banks have Jarge sums that mpst be put to work and a re¬
turn in the vicinity of 2.30% or better will no doubt be attractive to
them. ; r. It is possible for the long-term restricted bonds to tempo¬
rarily move lower under the influence of the gix months or longterm Tax selling, but this liquidation, \v|ll be absorbed.
/ /:
:

program
upon

return

likely that, this ineligible bond will,

V; The first official announcement by the Treasury on Feb. 15 that
the March maturities would be paid off in whole or in part in cash,

set

full

reaching effects

with

week,

longest restricted obligation is back to a
2.25% yield basis, after going as low as 2.12%....
.
J.t does not seem
The

"...

last

the

IMPORTANT FACTOR

Governments'

'•> «>**♦''!'>> *< :/

sizable, in

very

3/32nds being very much the order of the day.

ru.'-

2227

FINANCIAL CHRONICLE-

Fanning Joins

Burial will be private.

Thursday.

houncement ofthe cash debt repayment,

Thesesebuntips ;ad>

Goburn & Middiebrook
]

I I Samuel MagM Director /

FinancSai. Chroijici,e)

Vice-Presi¬

Magid,

Samuel

;

William dent of Hill, Thompson & Co., J20
Edmund Al Whitfng/ AUS,
Broadway, New York City, has
Obligations iyould result In a further scarcity of securities fhat pould has Returned from active duty and iH^ Fahhing has Joined the staff pf
fee boughtrby the commercial banks.
jbeen elected; a director of General
will resume his former position
Coburn '&' Middlehrook/ 37 Lewis
Vanced

continued retirement pf bank eligible

the belief that the

that

HARTFORD, CONN.

—

...

as.

Manager of their Trading Dp-

MOMENTUM LOST

Products

Mr.

Street.

Fanning in the past

Jersey.

New

Corp.,

Mr. Magid also is

director of

of Carthy, Major,; 4US, has become
|was with E. R. Davenport & Co. jEmpire Steel Corp., Richmond Ice
as^pciatedwlth ;th,^n intheiy Sales
Co./and American Sealcone Corp.
in proyidenee, •
&nd these banks would hot have the funds to buy the interinediate^, Department,
>
•
- ,'"
\
and long-term obligations. ; 3
As a result the paomentum that
m
carried these securities to- new all-jtime 'highs Was' lost and these ob¬
ligations hiovecl down onsomewh^t increased volume. . . . Most of'
This is under no circumstances to be construed as an offering 0j this Stock for sale, or as an offer to buy, or as a
this decline took place last week;
.
The following table shows
the recent market action of certain of the so-called trading favorites
solicitation of an offer to buy, any. of such Stock. The offer is made only by means of the Prospectus; fJ
in the short and intermediate maturities nf the eligible issues: ;
What

counted

not

was

the fact that reserve balances

was

deposit institutions would be decreased by the

the

debt retirement

•

;

"Closing

Closing Bid Price
Xssu*~»

;

All-Time

•.'>r;;:V,Y..

•Bid Price,

;High.apd Date i

Feb,-15,'46

;4./->..• >,

;

April 24, 1946

NEW ISSUE

Apr. 24, '46

-102.4 '43-1-46)
VA% 4ue-June J5, i948^^~Uw.^--1.101.31
104:0
3(3-1-46) "
2 $o•-due Pecember 15," 1949-51—
—+ 1 103.28',
(3-7-46)?!
2% due^September 15, 1950T52t_-*i.>-v—I 104.0 £ <•? 104.7
102.16 (3-8-46)
-due 'December 15, -1950__—_—; 102.5
104.18 (3-11-46) .2% due September 15, 1951-53
1; 104.14
.'
1054
(3-11-46) .

101.16

102.27

103

;

'-mi.

.101.13

102,000 Shares*

.
•'

;

'•'

t'Avi \i-*-;*■*:

'■'<

-.'S

■

'V':.V

'vj..

>'■

;'■/

:•

.•

...

' -. f

;

103.7

2cjo clue peceinber 15, 1952-54-—t 104.29 / ' 105.1 * <3-11-46).; * 103.19
-

Public Service G^pany

The longer-term bank eligible! bonds were ied byr the^-^is due;
Sept. 15, 1967/72, which issue finally moved through to a new high
early this month after some hesitation and Jotyer prices, following
the first notice of the debt retirement program in February.' . . ..

|||c^,;New

due March 15/ 11956/58 showed very little/change at first/
thp rest iof the bank; issues. ff /The hrice
changes of the fwp longest" bank, eligible bonds Jiave been as follows:

The 2 i/fys

but later went;down with

Preferred Stock 3.35% Dividend Series

Closing
Closing
r
<

•

- .

lssue-1

' '

2Vi% due March 15, 1956-58
-•: 1*6.13
2ya% due September 15, 1967-72——:-.i109,;15

Bid Price,

Apr. 24, '46

!High and Date

Feb. 15, '46

;

All-T,ime

* Closing Bid Price

•

108.J4'.

110.22 (2-8-46)

"107.22 ;>

1094P (4-6-46)

/ :
>

»i)ioS Stogrounp

V-

■■

3';>>•■•>■>;

•

Xv;/

#100 Par Value «J
•

' ^100Par Value

■

- -w

^Subject tp priof rights of ©resettt Pre/erred Stockholders under the Company'^
Exchange Offer which expires at 3:00 o'ejpek P.M,., Ejp.S.T*' ^lay 6, 1946

{

'
•!

^f f

bohds were able to hold
seilipg when the debt; retirement was
Tlie longest eligible bond has gone, off, almost

Neither of the long-term bank eligible

;

the j5rice at which they were

first announced.

Price $100 per

tyro?points from the allrtime top that-was made cnvApri|'6th.^. . .
This decline brought the .2tys due!Dec, 15, 1967/72 dowii 'tor a'yield
of 2J)5%, so that it is again possible for the deposit banks-to buy a

^pyeg^mentypbligatiph yielding
though the bank eligible bonds

are now

j-4%>■.?!';

It seems as

in a buying -area.

Copies of the Prospectus

*'/■ "">/'/

,r:

The restricted obligations have been the mpst active and most
made by the Treasury.

are-

why

reasons

many

these

bonds

have

should

sought

little likeli¬

hood of these bonds- being increased in the near future,

. ?

>'
This did not take into consideration that there could be an
increase In >the floating supply due to. liquidation, by nonrinstitii-

W. C. Langley

H. M.

; r

;

While these; sales

can and will be absorbed at a pHce' which
could be at these levels or just slightly lower, $ ; ; ' / ; ^ ^ "V r"

become

long-term holdings.

;

m;iy be sizable, they

f :: /

2V4%

due

.Yield
1.93

103.22
103.22

1.94

Vh% due 6-15-62-67-' 107.2 .t
IV?. % due 12-15-63-68——
106.20

2Vz% due

6-15-64-69

2Vu'fo .due 12-15-64-69'—2Vs% due
2V2% due

106.6 ;

%V2% due, 6-15-67-72c
2Va % due 12-15-67-72—

105.1 '
105.1

107.23 (4-6-46)

"107.23 (4-6-46-)

) 2.19 n

3106.17 (4-6-46)

payment.
the early

Yield

Apr. 24,'46

Yield

1.46

,105.15

>1.65

1.85

102.6

,v2.Q3

1.85;
.

.102.6

> 2.04

-106.2

•>2.04

i .89
1.95

2.Q0
-2.02

/Per

U05.24
;

•105.11'; 2.15"

2.12

104.5

>-<-'2.24

2.12

,104.5

2.25

their tops and in each instance
was

are

well under

given of cash debt re¬

The 21/2% obligations also went 011 to all-time highs

part of this month, then abruptly backed away from these

levels, to show prices not far from those prevailing on the 15th of

February.

...

The price declines in the ineligible obligations have

•

Phelps, Fenn & Co.

Riter & Go.

Putnam & Go.

The Rjohinsor-Humphrey Company

;

Whiting, Weeks & Stubbs

♦

>. R. S. Dickson & Company
//" Incorporated •.
Vi/'■;

/;'//

•

SchoelJkop.f, JJutton & fomeroy, Inc.

Baker, Watts & Go.

Bacon, Whipple & Co.

;

r'' ■"/_•;

: >3»-... >-■>,

1 Weeden & Co., Inc,

•

The Illinois Company

;
•

.
1,1;

\'fv Auchincloss/jRarker & Redpath
|

2.09

105.14v„-2.13.
105.11'2.14

Incorpor^ter!

Alex. Brown & Sons

Incorporated-

Maynard-H. Murch & Co.
•

[ \

Byllesby and Company'. PaineA Webber,.Jackson & Curtis
•

•

r-:»'•;i;-/-*

}

Ballou, Adams & Company
- -

Incorporated

•

Bopd & Goodwin i '
>

Incorporated

f|//|£3 j H.'F..Boynton & Co., Inc.

//I. ^Bostvorth, </hanute, Loughridge & Company

'105.15 '- i2.12

the time that.the first; notice
.

Cent.

2.01
.

2.20';. >106.19 (4-6-46.) "

Closing
Bid Price

1.99

407.24 ( 4-6-46)-i

I [

Per
Cent.

bonds after making, new all-time highs have reacted

rather sharply from

the prices at

2.11
2.12

INELIGIBLES HEAVY LOSERS
The 2^/4%

.108.4

H 1407.25 (4-6-46)

; 2.09 3 }
f

„

108.14,(4-6-46) ;v
44,-M6k;:

1.99
2.(35
-2.08

106.8

3-15-65-70—-' 106.2
3-15-66-7i
106.1

1.50

9-15-56-59. 107.5

yf% due 6-15-59-62__—
$i/4ft due 12-15-59-62-.,2

Ail-Time
High and Date
407.18 (4-6-46)
104.21
1 (4-63-46).
104.22/4-6-46} /.

Cent.

Bid Price

Feb. 15, '46

Issue-

i
!

tiyement was first announced is as;follows;
.k
si':
I :
ii'-:^/^.Closing;.; ;:a ;.Per;j,v|/v■
*

obligations'market movements ^ipc.e the debt vre-

' The ineligible

E. H. Rollins & Sons

;

Av Biair"& Co., Inc.

Baker/Weeks ^ Har4en>

holders' after ■ Mgy 15, \yhen the most recently : issued

bonds first

F. S. Moseley & Co.

& Co.

•

|tional
-

ofjhe several under-

The First Boston Corporation

higher

levels, the. most potent being the fact that there i.s very

any

vv';

There

be obtained from

mltm

tvidely moving issues f in both directions) in the whole list pincej the
15th of February statement was

may

/ 'writers only jit* States in fhich such, underwriters .are qualifiedjo act as.
deqler§ in securities and in which §uch Prospectus may legally be distributed,;>

!" 'c\

RESTRICTED^, MOST YOLATILE

r:5<;i'vrf

^ud'Js ;;vv /••:{- ! '^
:VBtosh, Slocumb & Go. ;> ■ Chace, Whiteside & Warren ./
Farwell, Chapman & Co.'
| VfyCptxV) fiC'% hi- ' ' zx? "
'
Incorporated
First of Michigan Corporation
Charles H. Gilman & Co. i Gordon B. Hanlon & Co.
t

J. J. B. Hilliard & Son /> Kirkpatrick-Pettis Company >/ F. L. Putnam & Co., Inc.
Rauscher, Pierce & Co., Inc.
^

'v/-V; ';

Boettcher and

;:Y

Company

Reinholdt & Gardner
.

;

4; 7;

Chas, W. Scranton & Co.

;j ;

.•;/ .•;:/•.}• ;

George D. B. Bonbright & Co.

■

•/

'•/.

Ferris & Company, Inc.

THE COMMERCIAL & FINANCIAL CHRONICLE

Thursday, April 25, 1946

Wellington Fund
The

Investment

current

Com¬

mittee Report on Wellington Fund
reveals that prior to the February

First Quarter Sales
The National Association of Investment
first quarter gross

Combined net assets
on

March 31, 1946.

the

by about

7% of the fund.

Companies reports that

changes,

one

year

previously

and

These investment

the

cash

from

the

sale of fund

shares, primarily

counted

the

for

decrease

ac¬
the

equity portion of the fund from
60% of total net asset at the be¬

member funds totaled over
$1.4
This figure is 49% higher than total net

bassets

industry's products.

ginning of the year to about 48%
by mid-February.
• - ,\it!'
During March, equities were in¬

and

undoubtedly represents the out¬
standing growth record of any

.■

T A\V/

■

«\nTnn

lYDTf'lJI \

major .section

the

;

in the investment business in Min¬

neapolis, has been elected to the
Board

and

tors

creased

amount
about 5% of total assets

securities

business.

equal

that as

March 31, 1946, equity securi¬
accounted for 53.33% of the

ties

member

Investment

Committee

Selective-Fund,

mutual funds under

the

of Inves¬

one of the
the sponsor-

Ship of Investors Syndicate,
Domestic

Ait

Transport

fai»i

; \

Investors Selective Fund Elects

break, common stocks and# other
KfjifNew Director
;'!
equities were reduced and senior
;J. R. Kingman, Jr., prominent
securities were increased

sales this year of the 74 member mutual funds
totaled $113.8 million as compared with $92.7 million in the
preb&ding quarter and $69.6 million in the first quarter of 1945.
billion

expansion to meet the constantlygrowing demand for the chemical

Calvin

Bullock, in the current
Perspective, analyzes the
Domestic Air Transport Industry.
issue of

"It

must

borne

mind

that

the recent growth of the

industry,
portfolio and defensive securities spectacular as it has been, has
accounted for 46.67%.
been accomplished
largely with
aircraft of pre-war design.
The
Suggestion for Bond Buyers ' f ,■
backbone of the 1945 operating
: "Instead
of offering your cus¬
fleet consisted of twin-engined 21todiers 2V4S or 2V2S in which your
passenger planes with a cruising
compensation is measured in ...%s
supply is subject to al¬
lotment:
(1) offer them .better
value and' over 3% return;
(2)

and your

make 3%

compensation for your¬
self; and (3) sell as much or as
little as you please without allot¬

ment

Shares.

YOUR INVESTMENT DEALER OR

'Thus,

Distributors

mailing

new

A PROSPECTUS ON REQUEST FROM

'*/

commitment."

writes

showing

how

corpora¬

Distributors Group, Incorporated

tions

63 Wall Street

"le^al" bonds by 50 % net after

New York 5,N. Y.

•

increase their return

can

taxes.

Machinery Industry

Ifi

new

Investors

folder entitled "Can

Profit

Wages?"

Hugh

describes

From

"Why

Higher

Long

Co.

The

air-conditioned

and
pressurized
carrying anywhere from
36 to 60 passengers and having a
cruising speed of 300 m.p.h. have,
been going into service and this

aircraft

trend

Group in a
Institutional Bond

Included in the mailing is

^folder

speed of 180 m.p.h, More recent¬
ly, twin-engined and four-engined

will

continue

ac¬

celerated rate for the balance of
this year and 1947. It will be ap¬
preciated that the speed factor

affects
and

turn-around

operations,

costs and increases ton-mile

capacity.

and converted

new

equipment and trained personnel
go into actual operating service
in the Spring of this year the de¬
cline in earnings which set in last
Fall should be reversed.
;-v->■

Mutual Fund Literature
Machinery Industry Series." The
folder emphasizes the ' following ■, keystone Co.—Current Issue of
pointsT with regard to the 'Ma¬ Keynotes describing the Formula
chinery Industry:
(1)
demand Plan method of investing; a book¬
hinges on industrial pace; (2) unT let showing Primary Lists of Key¬
derpriced by normal standards; stone Funds as of April 1, 1946.
T3) appears headed for record National Securities & Research
Corp.—Current issue of The Na¬
peacetime production;
t

STOCK SERIES
Shares

■

The Machinery Industry Series
tef jNew York Stocks is recom¬

mended

Priced at Market

"a single investment
ten
representative

Prospectus upon request from
your investment dealer or ■

JtepffincT Investors

Business Shares, both dated

portfolio

vestors,

Republic In¬

March

30, 1946,
and motion

120 BROADWAY

isis

manufacturing
and
steel
were
next in order, accounting for 7.6%

Americaii'Business

Shares, Inv;
Diversified Investment Fund
upon

request

Chemi¬

cal Fund shows total net assets at
March 31,1946 amounting to $18,-

454,777, equivalent to $14.89 per
share.
The report describes the
great

chemical

expansion in the

industry during the war, and cites
Request

the expansion in the

production of

synthetic resins from 300,000,000
GENERAL DISTRIBUTORS

pounds in 1939 to almost 800,000,-

NORTH AMERICAN SECURITIES CO.

000

INCORPORATED

Chicago I;.:.-,

Los

Angeles

pounds

facilities

are

1944,

"yet

plant

being expanded still

further to meet increasing needs."
And

SHARES OF CAPITAL STOCK OF

has

Dividends

been

estimated

cents

1946

per

three

of:

3.8

share, payable May 20,

stock

years

alone

record

Lord-Abbett Engages
Prof. Ynlema as

Consulting Economist !
The
Lord
Abbett; investing
companies have engaged as con¬
sulting economist Theodore O.
Yntema, professor of business and
-

V ■'■•!

economic pol-

that

plant

1 c
y
of the
school
of

BMH

Business, Uni-

Wm- versitv

P* B
MpI

evstone

Chicago.

various
as

IJMH

PUTNAM

IflHS

%. FUND

the

Cowles

Commission
in

MMi

Research

Economics,

special
.

c o n-

sultant with
the

Theodore o.

Yntema

times

director of

for

;;

has

served

SyMH

of
Dr.

Yntema

llrl

msi

ojf3$oUon

May 6.

1946.

$200,000,000 will be spent in the
next

dividend

quarterly

Prospectus

with Redeemable Shares

Building

rising industrial

American Business Shares, Inn

The Quarterly Report of

COMMONWEALTH

•>J 2500 Rum

April

current issue of Abstracts

giving figures

—A

Chemical Fund

San Francisco 4, California

1946;

oil

American

and.7.0,% respectively.

12,

Fund

production.
; Distributors Group!
pictures as the two most favorable
—Revised printing of the booklet
groups, with 8.5 % f of total net
assets invested in each. Aircraft "Put Your Money To Work."

Prospectus

Lord,'

and

^eveals^fetail trade

vestment company shares...
Affiliated

NATIONAL SECURITIES &

;

Survey; cur-'
discussing in¬

machinery companies."/,,

RESEARCH CORPORATION

N. Y.

Funds

prospectus

Tfie

N.w York 5,

Trust

rent National Notes

Abbett—Revised

'embracing

tional

War

Shipping

Ad¬

ministration
Prospectus

from

your

The

may

be obtained

and
■

local investment dealer

Prospectus
your

Keystone Company
of Boston

Congress (Street, Boston 9, Mass.

THE

may

be obtained from

local investment dealer,

PARKER

Prospectus upon request

CORPORATION

ONE COURT STREET, BOSTON
8, MASS.
4

economist

United States Steel Corporation.
The
Lord - Abbett
investing

companies are American Business
Shares, Inc., Affiliated Fund, Inc.
Putnam

•V;
*

consulting

Fund

Distributors,

50 State St.. Boston

Inc.

and

with
000.'

Union

Trusteed

Funds, Inc.
aggregating $85,000,Headquarters are at 63 Wall
assets

Street, New York City." ; *

Volume 163

THE COMMERCIAL & FINANCIAL CHRONICLE

Number 4484

2229

Government paid for them at the
time of acquisition or at the cur¬

(Continued from

had

•

page

$380 millions; of the unlisted se¬
curities $215 millions, and of the

2217)

estimated market value of

British-owned

J approximately $500 millions.

American

companies $200 millions, in¬
dicating a total appreciated value

Present Status of Loan
Of

;

the

originally

authorized

approximately $795 millions.
Deducting the balance of the loan
of $248 millions gives an approx¬

total of $425 millions, $390 mil¬
lions has been drawn down.

balance

the

loan

by the RFC last month

225,476.
been

Total

The

imate

reported

was

$248,-

collections

have

lions.

sale

retirement

are:?';Vj ^ Y/'1'- V i

Shell Union Oil Co
General

Motors Corp.—,..

Celanese Corp.

/ The

;

the

ownership

the

relatively small part of the col-

examplesi of

Government

British

575,385 was derived from income
from the collateral and $24,565,253

IcltOFdl

...

Outstanding

$196,140,638, of which $171,-

from

equity of nearly $550 mil¬

$196,140,638 has been applied: $141,774,524 on the principal
of the loan; $40,743,086 as inter¬
est, and the remaining $13,623,028
is held in reserve accounts to meet

Standard Oil Co.

Standard Oil Co. (N.

J.),J

The accompanying table
gives the number of shares of the

;•>'

prices of American securities

247,000
198,002

177,000
133,000
Rolling Mill Co* 133,000

for

may

•;

holdings

either

from

the

financial

the

and

which is

few

has

other

the
our

other

alternative,

less^ likely, is the gradual
the

securities

in advancing
While liquidation now

markets.

Government.

Perhaps the logical viewpoint is

been

years

advocated

some

large

that liquidation of the
amount of American secu¬

rities

held

probable

kets if it

rities

tion,

most

taken

con¬

preciate substantially from pres¬
ent levels, it is likely that they
will be held for appreciation just
as they have been held since 1941.

Conclusion
From

the

viewpoint

American

investor's

believe

most

benefit

dition of its

loan

at or near the

listed

stocks

British

approximately

time

relatively

when

low

prices

(July

Government Holdings of Leading

21,

following the granting of the new
loan now pending, they
may decide on disposing of either
a part of the collateral to pay off

appreciation, and liquida¬
if any, will not be under¬
for
some
years
ahead.—
From "Investment Timing," April
18, 1946, published by the Economics and Investment Depart¬
ment,
National
Securities
and
Research Corporation.

To Be Sold to Netherlands Government

British

RFC

loan

All Netherlanders owning assets in the United States and Great
Britain have been ordered by the Government to sell them to the
Netherlands Bank so that they can be utilized

by the Government

for the payment of goods purchased abroad;
in view of Holland's foreign exchange

The

Price

Companf—

July Current

21,1941

Price

Allis-Chalmers Mfg.s Co.—
Amerada Petroleum Corp
3 Amer. & For. Pwr.
Co., $7 1st pfd.
vAmer. Locomotive Co., $7 pfd

Appreciation

7 19,000
31%
56%
166 3/8
133,000 / 62 y2
100,000 7 20 74 122
4,800 ; 92 .; 118
American News Co.
25
,7
56%
10,000
American Rolling Mill Co.,
151/2
32%
133,000
American/Smelt. & Ref. Co.—744%
56,000
72%
American Sug. Ref. Co., $7 pfd.—
90
158
4,000
1 American Tel, & Tel. Co
156
1913/4
70,000
American Tobacco Co. "B"
943/4
34,000 I 71%
Arkansas Pwr. & Lt. Co., $7 pfd.'2
90
114%
3,975
4

$486,875
13,815,375
10,200,000
& 124,800
315,000
2,244,375
1,547,000
272,000
2,502,500
790,500
/Y 97,388
29% i
968,750
50% ?
1,061,400
157
"
1,648,188
76%
17,131,783

The

order affects

all debts to be collected

Britain and in the U. S.

■

Barnraall Oil Co.,
:
•

Briggs Manufacturing Co.,—,—,
Celanese Corp. of Amer., 7% pfd.
Celanese Corp. of America
Chic. Pneumatic Tool

Co., $3 pfd.

—1i.1,:

fChrysler Corp.
C. I. T. Financial
•

Climax

Corp,
Molybdenum Co

10%

34,800
; ,45,783
335,096
32,978

/ 19%

Inc.

25%
43

56%

57- ;y

32%
59,000
/. 89,995 | 39 1
773/4
19,000
61%
50,000
161/s
299,181
58 y4
<11,000

——,

Cosolid. Gas El. Lt. & Pwr. Co
"

Dividend Shares, Inc

121
7

22336,000
...

Columbia Gas & El. Co., 6% pfd.
Com'nwealth & So. Corp., $6 pfd.

7 Congoleum-Nairn,

50,000

133%

55%
35%
110%
125%
:

37%
86

1.87
2,655,550 1.10
257
139%
57,000
Electric Pwr. & Lt. Corp., $6 pfd.;
32%
155%
15,000
First National Bank (N. Y.)
1860
1,300 1480
Flintkote Co.
;
'
15
42%
27,000
General Amer. Transport. Corp..
69%
10,000 7 53%
General Motors Corp.
76
39%
434,000
Gillette Safety Razor Co., $5 pfd.
106%
30,000 I 42%
"Grant (W. T.X Co
*17 'P&
38%
23,600
Great No. Iron Ore Prop., Ctfs._.
19%
17%
79,132
Great Northern Ry. Co., $6 pfd—
28
58%
44,000
—

Eastman Kodak Co.———

—

436,959
2,754,000
Z
1,371,750
(292,484)
V
624,625
3,200,000
6,394,994
305,250
2,044,774
6,697,500
1,841,250
7.

494,000

lngersoll-Rand Co._._..
--—37 54.000
International Paper Co., 5% pfd..
53,334

108

Loew's, Inc.—102,000

fio%

39%

742,500
157,500
15,949,500
1,931,250
507,400
138,481
1,347,500
1,593,000
2,826,702
2,958,000

18%

29%

146,875

——

„

-Xorillard

(P.) Co.---—Marlin-Rockwell Corp.
McGraw Electric Co.

12,500
7,000
20,700
53,000
51,294
60,000

——

—

(Monsanto Chemical Co.
Morrell (John) & Co
Co..

National Biscuit

137%
122

51%

21,000
439,875
3,498,000
589,881

117%

35%

1,102,500

41%

89/'4

155

Thin American Markets

well as*

account

other debts expressed in

monetary

values other than those expressed
in stocks and bonds.

bilities:

the royal decrees of May 24, 1940,
all assets of Netherlands nationals

Although demand for American
securities

for

markets
the

margin

requirement, "liquidation

of the
probably

bulk

due

of these

would
year

securities

several

take

prior to

many

100%

stocks

in Britain and

nevertheless

great,

thinner

months

for

trust

and

accounts

Assets

tries

es¬

tates, and special offerings could
be made to the/public through
Stock Exchange firms and under¬
writing houses. To liquidate al¬
most $600 millions Of securities,
however, would be a huge finan¬
cial
undertaking even in these
good times, especially if it

stipulation,

must

de¬

The pres¬

therefore,

con¬

all those assets which up to
were not subject to any pre*

for

instance, non-negotiable

as,

paper.

WINSTON-SALEM, N.C.—Alex.
Brown & Sons, members of the
New York and/ Baltimore Stock

some

Exchanges, have opened

Willis.

O'Hanloh

the

branch

Building

under the management of Ben S.

Government

Willis'

Mr.

association

again in possession of the securi¬ with the firm was
previously re¬
ties it does hot seem logical that
it would offer them to the original ported in the "Financial Chron¬

the icle" of April 11,

price

the

Board

15, which also had the following
to say-

binding

bers

on the Exchange, mem¬
explained, but the stand will

serve

recommendation.

Exchange

has

•

offer to buy any of such Stock.

ISSUE

NEW

41
603/4
8,500
167,875
29
22%
24,000
147,000
92%
113%
8,693
180,380
pfd.j
Radio Corp. of Am., $3.50 1st pfd/
94
8,000 M 54%
/ 316,000
Radio Corp. of America
17
3%
,177,000
2,323,125
Y
St. Joseph Lead Co.—
59
—;
38%
10,000
201,250
Sears, Roebuck & Co.—.
47%
188,000
$18%
5,428,500
8% / 21%
Servel, Inc.
30,00
386,250
y 15% 4 38 'Y 20,137,500
Shell Union Oil Corp.—v—
-2 900,00
Simmons Co.
——7 7317,500
18%
53%
608,125
33474: 15,956,267
117%
Singer Manufacturing Co
—3
73,701

time has been
Board
a

Association

the

mer

and

*30

Total

Appreciation

*Adjusted for

2-1

^Adjusted for 4-1 stock split.

split,

:-<?

.vY/v
"

82%

104

648,750
973,104
842,625
452,500
505,000
245,000

29%

7,687,875

38%

74:7 /

2,662,500

91:

120%
*213/4

40,000

.7,000
247,000
75,000

160%

443/8
36%

^—$187,687,451

fAdjusted for 3-1 stock split.
§Adjusted for 1-4 stock ex^ange..;.

V-*-'/1-':

f-jV

■

•

Y /.

'v..

particularly/in regard to
and

costs,

was

The offering is made only by* the Prospectus.

'y.^

vYT*'v'/V.' *•/

-•

(Par Value $25)

•.'

-i

Price $25 per share
i.

So
V •' i'.r

I
V

Copies of the Prospectus

Van
'April 22, 1946.

may

revenue

announced

Wymond Cabell, Association PresY
ident.
•
1
/
1 ;

*Vt

•

sum¬

"Expansion olfthe Association
throughout the nation was dis¬
at yesterday's closing sesY
sion, as were operating problems,

;

if.'
'*v

"YOY.oo/;

308,750
1,335,000

111%

stock

YYY;;Y'

—

Wheeling Steel Corp., $5 pfd
Woolworth' (F. W.) Co.—
Youngstown Sheet & Tube Co.—

44%
74%
50%

443/4

Westinghouse Air Brake Co

51%'

■

this

appointment

cussed

The Drackett Company
'•

ap¬

arrangements committee.
Date and site will be chosen later.

4°/o Cumulative Convertible Preferred S$oek9 Series

877,500
1,168,750
3,780,000
5,816,309
1,503,000

for

authorized

' +:■ y-.

discussed./Y

Governors

103.000 Shares

will

first general convention

proved

——

———-

11.—CottaLi

IV'):

The

on Saturday from June
through September, and a gener-v
al closing
of exchanges at the

—

announced

be closed

Public Service Corp. of N. J
Pure Oil Co., 5% cum. conv.

ioy4
§24 'P%
32%
443/4

"No action by the organization

This advertisement appears of record only and is not, and is under no circumstances
to be construed to be an offering of ,this preferred Stock for sale or a solicitation

New York Air Brake Co

Socony-Vacuum Oil Co., Inc.—
130,000
Standard Brands, Inc
T 42,500
Standard Oil Co. (Indiana)— : 315,000
Standard Oil Co. (N. J.)
-7. ' 198,002
Sterling Drug (Inc.)
72,000
Timken Roller Bearing Co
19,000
Tri-Continental Corp., $6 pfd
30,000
United Shoe Machinery Corp.—j
30,000
U. S. & Int. Secur., $5 1st pfd.--/
29,488
U. S. Steel Corp., $7 cum. pfd
21,000
Vick Chemical Co
20,000

British

either

regular

on April
Governors,
Association
of
Stock
Exchange
Firms, it is learned from the St.

"The

full, the collateral then
being returned to Great Britain.

owners,

adopted at St. Louis

was

same

Alex. Brown & Sons Opens
Branch in Winston-Salem

office

the

assets

were

With

opposing

such

viously-issued regulations such

the securities will pay off the

loan

coun¬

liberation

A resolution

year-around Saturday closing for
the New York Stock Exchange

holders

■

Closing on
Saturday of the
/
NYSE Opposed
/

Louis "Globe-Democrat" of April

now

period of years it may be ex¬
pected, as indicated by the record
so far, that eventually the income
together with retirement of

Holland's

cerns

are, of course, automatically sub¬
ject to foreign exchange regula¬
tions issued since that date (May
7,
1945)
which
stipulate
that

ent

held for

are

acquired in those

after

clare them to the state.

generally known that the British
holdings were being liquidated.
If these securities

1940, and after
to May 7, 1945, auto¬
*

Some private
could H be
effected

Year-Around

the U. S. acquired

15,

matically reverted to the Nether¬
lands state.
/
,

through financial institutions,
through insurance'companies and
banks

May

that date up

to accomplish.

placement

pointed out that, under

was

by Netherlanders in
Y
;/ t/. /
■

——-———.

balances /and

is, of course, impossible
to know what will happen, the
following appear logical possi¬

While it

with

taken

measure was

position.

current

1941—

■-V-'fJ-;A_-.- •'

secu¬

further

Dutch Gash Assets in United States

top of this cyclical
quite possible that,

were

Stocks

from

Conversely, if the British view¬
point is that security prices are
move: it

ket

present value of the

How¬

market

The total

attempted.

likely continue to hold the

their

new

were

the British Government will most

mar¬

being made, it seems
unlikely that this contention
will prevail.

for

liquidation because, in our opin¬
ion, it will not be required as a
condition for the making of the
$3.75 billion loan now pending;

If they

collateral

ever, we see no reason to be con¬
cerned at this time about such

judgment of the future

act

here

the British loan of 1941 would be
discernible in our security mar¬

critics of the

that the British will
own

The

liquidation

eventually returned to

British

institutions

countries.

will

used as collateral

loans

held

the

future

the

naturally raise the question as to
these
British holdings
are hanging over our market and
are
likely to be sold in part or
in full, or whether they will be

whether

American

21,000

United States Government

Amerada Petroleum Corp.

U. S. Steel Corp. (pref.),,

all

not

either be sold

the

all of the col¬
leading stocks currently held; the
Hindsight indicates that
the
lateral, except the British-owned
price on July 21, 1941;| the cur¬
posting of these securities as col¬
insurance companies, with the ex¬
rent price, and the; appreciation
lateral for a loan rather than their cess
in value, totaling over
proceeds over the loan being
$180 milliquidation in the New York mar¬ withdrawn.
lions.
'

think that the securities may ap¬

Socony-Vacuum Oil Co.,, 130,000
American Tel. & Tel. Co.,
70,000
Chrysler Corp.
36,000

Value

move.

interested

900,000
434,000
335,096

Appreciation

ket value of the securities.

Radio Corp.

succeeding interest and - principal
| maturities.
'
1

Average

ShSrGs

(Ind.)__ 315,000

F. W. Woolworth Co.____.

wise

Investors

insur¬

ance

Industrial

Dow-Jones
129.51) was

rent market price.
This supports
the belief that eventually most

be obtained from the undersigned.

Alstyne, Noel & Co.

2230

THE COMMERCIAL & FINANCIAL CHRONICLE

Factors in
By

Speculative

BRUCE

WILLIAMS

induce

excesses

(Continued from page 2218)
erous rand
significant, that wm
deeply -appreciated by my people.
And 'in the year that followed you

inevitable

their

aftermath.

•

Both

able

Anglo-American Cooperation
the

•

Canadian Securities

bonds.

dian

The

Board has long

Federal

been

Reserve

voice

ing in the wilderness against
ulative
towards

the

between

Federal

Treasury; the U. S.
market ""paid

establishment of

bonds.

and

result

been

closely

other

executed

Exchanges,, > of8 at

net

.hV'

from

•

v/V.

Bell

rates

and

inflationary

becomes

low

hat
,

in ::this

increasingly

reaction from

some

established

low

levels

System Teletype NY 1-702-3

the

most

our

common

Roosevelt
met

ber- Pearl

;

partner.

and

•

}

S.-British

■

the

war?

Bstablished

was

2Vz% fnd the

action from 2.10%

the

represent

CANADIAN BONDS

to 214%

elimination

our

.two

down

months -ago

countries

defeat.

•

answer.

world had known

unique

wealth,

And

Such

sue.

Mussolini
tion

GOVERNMENT
8888
8-8;8 :88 >
PROVINCIAL

8-'

||||||

MUNICIPAL

concerned,

the

appear

•

)

"developing: wherever undue regi¬
be opposed

can

by the
fur1

the

originally j. During the past wCek the marwasfket .could only be described a$
was
success-1 nominal. All sections of the mar?

coupon

issues in the hands of the ' prices.

war

public. In order to
cess

icy

of this

ensure

the

suc¬

anti-inflationary pol¬

great caution

has to

dis-

olayed in reducing the yield below
i level which would be unattrac¬

tive for investment by the public.

Consequently
vhich carried

TWO WALL STREET

recent

rajfid

the

recently issued

Victory loan 3% bonds to!a yield
'evel of 2.55% was not" induced or

NEW YORK 5, N. Y.

followed
Tust

RECTOR 2-7231

the

ise in the Dominion bond market

NY-l-1045

fthose"on,,whjch they
about what 4s go'nr

wrong t^sn about wh?t js go,5n^

in
dis-' ket were listless and the negliributing the great proportion of gible" activity had' little effect on

INCORPORATED

than about

right.

leliberate.

ilaced, and desire
jj'ly
put
into „^effect,

A. E. AMES & CO.

dispute, rational °
threshoM; p»»d by the nature of thingf
be
wilj always, hear more abon
the points op which people dUf<7
crosses, his.

by the/ Bank of Canada.

is logical to anticipate
2t4% level for the longest bond
as

the

Free funds remained firm

9Vs%

with

transactions in

sef

curities

playing only a small part',
The outlook for' the immediate
future increasingly dictates cau¬

tion

extending

commitmehts,

especially in the low, grade
tions of the market,. ^

seer

market

here

onnor-

in.

&
Wall
v

i. WHitehall

3-1874

In
5

matters

Municipal
facilities
Canada

relating
and

our

and

record.-

Such

idea would hay?

seemed strange to an earlier
eration in
l^r

our:foreign anjl

gen¬

co^u-

It is recorded tjha'
^once a British Com-u"
who, after ,d?scharging his dut'e"
service.

there

was

for many years in this citv, wa"
beard to remark that he had rieVe-

)

«.

«et

Government

Provincial

tary and treasurer.

Canadian

was

back to

my way

and was sitting in
my bedroom on the train when .a

boy

along the corridor with
of
magazines he was
He offered me one, arid j I

carre

bunch

selling.

told him that while I

magazines

was sure

most

were

his

interesting,

I had
'

-»~ri

very l'ttle time for reading
wac' anxious to finish a book

I had with

if I
and

8 He then asked

me.

the British

Ambassador,
when I said I was, he carre in
was

and sat with

"arid

for half

we "/had" q uite-a

hour

talk about

'books and - reading generallyv! At i
the

end

told

conversation

our

that he had much enjoyed
"his talk with me, and would like

"an'

uncomfortable

memorv

"those warning letters of »gold;. but>
"how could I refuse the boys'
gift
"without gravely; hurting his feel¬

ings? So; "for the rest of my
"journey, I found myself com8
"pelled to practice
ure

certain

meas¬

"duplicity.

.::

I; made

-•

■•

my4journeys because

CANADIAN

Government,
i','

investments,

England,

New

are

make

gave

the

vast

8 STOCKS 8

;\c:r

...
>

; .»*' l'

•

Industrials

York,

—

Banks

—

offerings furnished

upon

request.

•

■

:•

•

A' 8

•

V v,
'

(

Mines

incorporated

Corporate

14 Wall Street, New
York 5

8 8" '

Teletype NY

Members Toronto Stock Exchange

1-920

(11

Broadway, N. Y.

Whitehall 4-8980
N

Direct

the op¬

and

this

natural

country.

years

the

America,
doom

observe

was

industrial

hammering

the

Axis

might

the

out

powers;

watch

young America on parade
at your universities and
colleges;

'■.-

oroeress
„

-Royal Bank Bldg.
Toronto, Canada

Teletype NY. 1-142

arid there could surely have been
no better antidote to
any transient

"feeling

CHARLES KING & CO.

Wood, Gundy & Co.

quarters
>'.

course

resources

heartening experience in those

■

portunity of seeing something of

war

available.

Municipal

-it

;■■

organization

Bell System

against
his part to inter¬

CANADIAN
SECURITIES

gold,

Washington,

fdotpri^e'mairi^^

Bought—Sold—-Quoted
Bond

graven

.When the, boy
"passed my, room, I proudly dis¬
ma.
Nor had he; for he liver) or
played the badge; when anyone
Staten IcUnd, 'worked on 'Man¬
else came along, I took evasive
Carrick m Toronto *! ]■ hattan
Island,;ar»d took his holi¬ action with
my pocket handker¬
TORONTO, ONT., CANADA ?4 days oh Long Island.
Nfo ddub;' chief. "And so. I am
glad to sayr
J. J. Carrick, Ltd., will engage in he had bis
reasons, as I had mine
I returned to Washington in safe¬
the securities business from of¬ though!this would
hardly find fa¬ ty and no
diplomatic incident re¬
fices at 330 Bay Street.
Officers vor in these days, 8
sulted. '
88 8;j \ ; ? 8.
.V;;-,...?
are John James
Carrick, president,
8
Such
The Traveling Ambassador
journeys as.I was able to
and Andrew M. Harnwell, secre¬

Corporation

London,

Canadian Securities

COMPANY
Street, New York

-nvarning,
letters

South. "I

wonders

;

conference of Governors in the

the

TAYLOR, DEALE

tunity e^me my way, fleft Washington -and moved aropndth' "to8
give" me something that he
country.
Diiring ;the\fiye^year 'greatly' valued,
j Whereupon 8 he
that I have been. Ambassador
urioinned a badge he was wearing,
have visited! every ; S.tate in th'
"which 'carried the words "MaqUnion;; which, as British lAmbas
Arthur for President," and pinned
7»dors 8go,? I think)constitutes r It on the laoel of
my coat.
I had

<.•

Government

it would similarly appear reason¬
able to expect a 2%% coupon on

So,- whenever; the

bassador; ignored 8 this warning,
with melancholy results, and since
them the .xule hap been -scrupplously' observed.
But one day I
happened to have been a guest at

every

fere in the internal politics, of this
country.
Once, long ago, an Am¬

riddle; bv

set

established. Greater emphasis

CANADIAN STOCKS

later

com¬

was

attempt

any

There the pe^soectiv®' r
Ambassador is l-able to be
co^e partial and distorted. Sonne1
infernationaL

were

it hqldi

aoree; -mof-e

recently the Dominion mar-f J ther recent case in point is the
was slower and more. discouraging
reception 'given tci
Throughout the war in the efforts of the British author^
pite of the urge of external ex- ', ties to have rhunicipal arid public
ample there was no departure issues refunded on. a 234%' basis',

dor

ington

was

not without embar¬
rassment; On the desk'and in the
heart of every British Ambassa¬

any

forces of "true democracy. A

tempo

kindness

oly sitting all the: time iri Wash¬

that with the

uation of the low interest trend is

mentation

the answer to that

the."claims

8Sometimes', I -must -admitr the

shado^r of fha*
w?
c|n avpi<;

us>

with

iting^ Ambassador.

the same mistake-again.; " '
T nevpr felt that I. would fjp/

; 8 f.

exigencies.a na-f

war

history;

unless I had ^een

spect, in the ungrudging kindness
they have always shown to-a vis¬

dared to dc

until

from

/ CORPORATION

!
Canada

Thaj;.,first,quel*

behind

reception by

tural resistance to further accent-

ex¬

lation..
far

it would

re-, en(j

aggeration and undesirable specu-f
As

belongs

Washington. I must add,
too, that with all their differences
I found the states alike in one re¬

the tragedy of 20.
years;! and ,thf
secret of the future lifs in whpthor-not. w'th the,

ojt

Lng bond is*

public. '

woujd have

not pretend

much of all of it

patible

what they-did?

everywhere to. issues both
and international.
And

work in

with; complete-

; common

conduct, powerful to
approach of men and

varied country,
as

anybody suppose
that the Japanese, oir Hitler, jo:

Canadian

does

8 certqin

any^ knowledge, of this vast and

certainty 8 that ^between; the ag?
gressor -and his -intended vlct'm
lay the: concerted will and com•
bined
strength
of [the- .Uniter,
States and the British Common

be^

the birth

saw

the next Dominion

could;
of

be able

I felt that I could

had any doubt of the righIf from 1931 onwards thf

never
t

officially

would

us,

people.

domestic

And with this experience

behind

i.'..

collaboration

assured of favorable

140,000,000

the

women

Collaboration,

the

level

affect

1911

between

Mr.

The end of the year saw. the ber

with the oft avowed policy of the
last

the" years

you

......

Treasury to maintain low interest
The

During

iur

step would -be in
214% ,»closer harmony with the
custom?
s^y conservative procedure of the
in the least degree at variance
Canadian
authorities
and
more

-ates.

'; ! 88 V 8 ' 8

1939, would the world Mvi
suffered ! thi3 tragedy: of a second

signed

Harbor -made

went

not

for

what it is, instinctively held to ap¬
prove and to condemn, the term

and

level, for the last bond would not
)e

sblp

tions \tfete consta ntly in my mi ndi
Had we had a like cooperation

recently

welcomed. On this side

farmers

strategists

our

all
this" time,? as
1
watche'd the" working of this tre¬
mendous machine, gathering im¬
petus With the months, two ques*

began to move across the world!,
until, in due course, first Italy,
then Germany, and finally.Japan,

mly be unopposed but might "also

4-...«.>*•.

knowledge,

and

Britons fought under
command " of
Americans.

the

prints of victory were-drawn. The
fleets, the airplanes,, the armies

cleat

might

From Maine to New Mex¬
ico and from Virginia to Califor¬
nia, the term "American" is more
than a title of' common citizeri-

server.

their ideas.

in history.
The Combined. Chiefs
of Staff set to work. ; The blue

any

direction

flew

Our- sci¬

tween

apf

implications" of

production,

preemi¬

something not easily

be: measured, by its strength
in operation.
And it must always
be impressive to the outside
ob¬

gress ' passed

ginning

scale

their

one

ily

proclaims

U.
.

market

moreover

pooled

It'is

the

States,

translated into words; but
though
difficult of analysis it can read¬

standard

■

sufficiently perturbed by the

exaggeration

;8' New York 5, N. Y.
'

Dominion

their

nent.

in maintain our cooperation in the
form, as so many of you had Ion? homing years of peace? - r : - - * -1
been, in feeling,, our full ally and .: To- the " first .question L have

Gov?

external influence,

airfields.

industrialists

our

thai

Atlantic Charter! And In Decern*-

the

had

market

the

undue

pear

6RP0RATI07I
'

Canadian

constantly, decreasing

Dominion Securities

bond

insulate

Interest

40 Exchange Place

the

all

investment

0; Now that the monetary authodu¬
ties are no longer so dependent on

Buffalo,

888;. Toronto and Montreal.8,-

the

entists

road tc

knew

British

from

were

American planes

United

has always seemed to

the Atlantic in Brit¬

across

ships;

the

Americans "fought under, the comT

Churchill

corn?
faithfully to follow the
movement taking place south of
the " border; so much so that a
preliminary effort has been made

New York Prices. -1

•

ish

mand of Britons.

^esid^nt,

menced

treal and Toronto Stock

Vv C n

financing

followed -<by

sections

eminent

(for dealers, banks and
institutions). on the Mon- >

Direct Private Wires to

cost

wartime

become the bell-wether which fias

internal

orders

the

low

market/ Even

Stock

the Government bond market has

all classes of Canadian

external

~' " '

longest bond.
a

necessity

MARKETS maintained in

•

the

carried

another," ahd later one
formidable-weapons
armory. In July,
with fateful folly, Hitler launched
his attack on Russia. In September

early

t^e

only

credit

those months had set the patten;
of the future.
On March 11 Con¬

nation

2% yield basis

not

achievements? standing 8 to"

beeij
complete a unity of military
Industry!, and political effort., Ij
right almost be said that wf
fought
as
one
people. Britisl
roups ' used ; American
tanks/
planes and guns. Americans were

lend-lease, at th£
time an unparalleled act of
large?
hearted
imagination * from8 one

bond

little heed and discounted

stocks

inf

Reserve

*fet

our

two

any

there

had

war

would win; we began to un¬
derstand how we would win. For

Encouraged however

Board and the

new,

one of. the states^
an^ the
people of every one of the states,
are
different.
Yet
of
all
the

every

the quest of peace:

Never before between
countries in

apparent opposition of ideas

and

firmly set

victory.

spec¬

and. .ever':, lower'

low

Government"

bonds

in fact

cry¬

exaggeration of the trend

terest rates.

old

Nations Organization
Francisco, and started iri

all earnest

————

foes

United
San

judge the truth o
here and in Canada the prospects of glittering profits in the usually
Lord Lothian's words, and we h
safe and staid Government bond markets has attracted purchasers
measure
the magnitude of you:
who customarily operate in more speculative fields.
Less amendable
response." Today, as we look back
to disciplinary suggestions from the authorities than the conventional
we
recognize 1941 to have beer
operators in these markets, the ever-enthusiastic speculative elements
the year of decision.8 We might
—<3> iave
rendered
inoperative
the
lateri as we did, have to meef
orthodox controls,:8'*88;88
misfortune
and
disappointment
The Canadian authorities gave
but by the end of "1941, thcugl
a significant hint in removing the
we were under sore
pte~s 40 froiy
registration privilege from Cana¬
were

Thursday, April 25, 1946

depression

of the

war.

about

the

And I have

doubt that bv travel I acquired

truer sense of proportion about

Anglo-American
work, and

private wire to Toronto

The

relations,

even

adjustment

was

about

about myself.

sometimes

■

;X-;.

V-y.YV.iiy../;^

Volume 163'

little unexpected.
cellent

dinner

THE COMMERCIAL & FINANCIAL CHRONICLE

4484

I recall

instance, that the

an ex¬

bound

given
city of the Middle
was

by a club in a
West.
Afterwards

■

;" V:'V

Number

once

the

yet

re¬

cent events have shown them very

members

ready to make experiments—both
other hand, we are often told that

them.

Americans

political

out

came

the

club,

my, secretary overheard a
/ snatch of conversation between

fj iwo of the elder members., 'One
Said, "It has been fine having the

British Ambassador .here,
Wish he'd

and

often." That

come more

Bounded good, and

loyal

sec-

tetary pricked

up his ears, ex¬
pecting to hear something equal¬
ly flattering in reply. But the re¬
ply was, "Yes, we haven't seen

steak

that in

two years!"

the

course

reported to

was

with unbe-

memory of the man who wrote to

similar informal

outsmart us
;/. untilVI listened to Lord Halifax.
Now I know it- is not true1."- •• ;
apt

were,

Question of Peacetime

...,.

But these

were

minor incidents;

and above all and before all,

always trying to find,
to myv

;T.C

Cooperation ,/.±. /

was

answer

during the years of
peace the cooperation we learned
and practiced during the years of
war? To my mind the future course
of history for your people and

mine, and perhaps for the world,
upon the answer,' And !
not doubt that this problem
above all others has occupied the

depends
.

mind of your Ambassador in Lon¬

don, Mr. Winant, who has won for
himself so notable a place in the
confidence J of the Brit^h/ people,
A year ago in San
the JJnited

Franciseo we
Nations - Or¬
ganization. I It is in truth the last
best hope /of the world.But if
that charter of world peace is to
be worth mbre than the ink with
/'Which it .was written, it must car4ry the endorsement .of the pur¬
pose, friendship, and understand¬
ing of the peoples who signed it.
With that; all we hoped for was
f

framed

possible; without it, nothing*
>' It 'must take time for the how
mould to set, but let our two har

tions, who already have so much
in common, lead the way to this

years,

and obscures

that the Commonwealth

fact

Empire of Fang George VI
something very different from
the;' /Colonial' empire ; of
King
George III. •;■■-y and

J3o.we could gp-on,•

Item

this side of pur bal¬
sheet and now on that.
But

.now on;

ance

sooner

later

such

come-to

one

im¬

overwhelming

port that nothing else by~compari-

matters / very

soh

back,

look

As we

much.

history we discernthe. emergence. at different times
on

of many issues vital to both our

countries; arid I

recall hardly

can

occasion" of this sort when we
have returned a different, answer,
That

happy accident./ We
think the same way because our
thought has been shaped by the
was no

invisible forces;;. The head¬

same

waters of, the rivers that nourish

national .life /are

our

two

friendship / be¬
countries

in¬

spired by no selfish motive; it a?
directed against nobody; it is not
an
end, but>a beginning; it has
no other object than to strength-i
en
and /reinforce ./• the will
and

the

air

will allow

you

serve

one

who

his own country

faithfully, - and has come: to have
deep-affection for what for. over
five years has been the land of his
■adoption, to speak frankly on this
a

vital

matter

•

our

'future

rela¬

same.

brave kinsmen and comrades, and

find in war.; Let
the

are

both sides

There- is, for ex¬
ample, our language, so like and
yet so different.- It is easy for

of the account.:

the

those
; words,-so familiar to every school
child, but withal so perfect dor all
generations that they can hardly
be ioo often job our lips and in our
hearts: /"With malice toward none;
with charity for all; with firmriess
m the right as God .gives us:to
the right, ief:. us; strive on to
ish the work we. are in." /

ife'|t/"then/remarkable /that- >ph

thfr things that really matter we
should think and act/ alike?.
It
Would-be -much more r&arkable
it otherwise/

were

And !

am con-,

appeal to

for

about half the

iden¬

people of this

country; nor/An-eriibtioh, dor- that
is a* transient and unstable force;

in NY

but

of a.

Yj: know/.well, of 'course, that
even when
this has been recog¬

differ.

have

these

which

has had its hapoy and its
unhappy ^occasions,y There - was
your tea party at Boston and ,near¬
ly two years ago there was our
joirit
breakfast
party" on"! the
loeaches of 'Normandy.* There is a

difference

Altogether
be

dull

of
a

..temperament—-not

liability, .for it would

world

were

all

Alike.; ' I have often thought this
difference

was

not so great or so

not
greatly matter so long as
thereis
%/ /uhderlyi^f/mmty:

There indeed is
contrasts

one

preferences
thereafter. During

the latter period Philippine prod¬
ucts entering the United States
will

pay a
gradually increasing
duty, beginning at 5% of; the

while United

sonable, to

faith

propose,, as

the

act

restoration

free

trading conditions, that both coun¬
tries should simultaneously aban¬
don.their discriminative practices;
What is unfair is: that the present
state of the world should be held
to

justify

a continuance of Amer¬
discriminations without the

ican
same

benefit

being

Britain. And if

one

extended

country rather

than another should give

lead in

dismantling its discriminatory de¬
fences, should it not be the coun¬
try that can/best afford it?

It is

simply not true,/as the ExportImport ' Bank
affirms, that /' all
!countries can supply credit to iiinance their own exports, America,

products of any foreign
and

increasing by 5%

country,
annually,

States products en¬

tering the Philippines' will pay
corresponding percentages of the
lowest .Philippine-duty assessed
on
like products of any .foreign
country..
y: •
.

quotas

products

of
—

•

absol ute

years

for

established

are

amounts

During, the

emphatically,
much

afford to do.

can

besides,

/•"

so,

// "Viewed against the background
of America's trade ..opportunities
the

size

its' surplus,' the

jExport-Import Bank's final
ment is even

argu¬
curious. Amer¬

(the

certain

sugar,

Philippine
' cordage
and

rice—which may enter the United
States in any calendar year, while
both absolute and declining duty¬

free quotas are imposed on:cigars,
scrap

and filler tobacco, cocoanut

oil and pearl buttons.- Y

;

f Duty-free quotas begin in 1955
and /decline

Amounts

excess

annually.

the

duty¬

free

quotas

100%
year

shall

the

can

subject

duties/ but in

absolute

quota

exceeded. Y' Y.; --■•y./'"Y jY: ' YYY'

(■!;;■ "

During the first 8 years, a prod¬
country, in order to
enjoy free entry into the; other,
uct of either

cannot

contain foreign

amounting to
its total

materials
20% of

than

value, and most-favored

ica's credit ^structure, it is said, is
nation treatment is provided for
not adapted to the needs of US
Allan Sproul, President of "the :ex|x)rters"-anxl
products - containing more', than
importers, because
Federal Reserve "Bank issued /on overseas trade
forms an unusually .20% foreign materials. With re¬
Aprir23 r the: folio wih"g/hotic6/-toi Ismail proportion of Iota! US trade, gard to all special import duties

Sunday April 28

from
the

market

believable

Pot & Call Brokers

would;

But that is

or.

the

lent* free

dollars?"

the annual meeting, pf the

/Asspc^atiori.,

Put^^ apd
D.: Harhden.

exporters

?, Thet.

1946

/dollars, "instead' of tied

■/

• - :

■

Philippine Trade Act of
by Congress and at

passed

re-elected

was

Daniel

Inc.^'> wbre; again !with enactment of, the Act And
-

/ /

ending July 3, 1954, and for re-

99,000 Shares

way.

the

never

Battle
of

(a DelawareCorporation^

our

free

of Marathon

this

Britain
mah

proclaims
will" end by
\

; *

.pattern/of. Anglo-

American

relations,/we shall weir
variety, so. long as. the pat¬
tern remains/ and we shall not
fear differences, so Ippg as behind
come

interesting to note that the De¬
ex¬

and trade

barriers, suggested that

the Philippine Islands after inde¬

be" hampered' by lack/ of pendence "b£ left unhampered in
facilities
if -the/ bank its.
right to employ the most

r,/;x
; At

{. ■••■

Is it/really

our-hope. We /look, in

mastering the slave.
So,

partment of Commerce in the

financial

Re-Elect Officers Y
..

whole.'
that

dictator looks at/his peor

Battle

that

f
Although this policy is now ap¬
parently about to become law, it

cities of New' York and Buffalo, able/supplies]. only, if it.can be ecutive committee meetings Which
New York,' Will be one hour iri ad¬ 'demonstrated
that "the terms it .sat on the formulation of the poli¬
vance ' of. /Eastern
Standard, time, offers are substantially out of line cy,: took a contrary .position. The
and /tbisZ/bah^
adverting' >. to ; 1 he
On with the credit conditions prevail¬ Department,
such' loc^lithn^V/^ -'t/Y Y^/ /
^ ing in the American financial American" efforts to reduce tariffs

of.the great

between j: the

deep as many peonle have sup¬ them there is this common and
posed.
It is sometimes said, for compelling - purpose. /• For in a

declining

years

though perhaps submitting them
jto some .impartial examination to
avoid abuse.
Or. it might be rea¬

differ¬

also among ourselvesin our.
separate countries; and they/do

the words of St. Paul, to "a diver"sity of gifts/ but the same spirit."
We believe that this diversity is
an infinite enrichment of life", that
freedom avails more than regi¬
mentation, and that all history,

language;- we aren't always
quite so sure. Or there is history,

lowest U. S. duty assessed on like

ences

them to misunderstand

the

favored

Price $3 Per Share

nation

principle

its

international trade arrangements*

Henry Benson With Pollock

this

command.

oth¬

not, in fact,

eiprocally
for

is reasonable to propose that both
Britain and America should retain
their
respective discriminations,

land

Daylight Saving Time

jfhis writing awaiting presidential
'priceless . inheritance President;/ B. M "Balson- pi\ Bal- approval provides for 8 years of
common thought/ .
•
spn % Buiriiamand j^^/^eder oi reciprocal ,free trade beginning

thought

each

world

world. Precisely so;
that- is exactly the ease that the
/"Economist" has often argued. It

and
j

the

multilateral

Americans and British to talk to¬

(You think you have improved

see

are
justified and
helpful in View of the fact

gether; but it'is equally easy for
er.

spirit1* of

our

pie and the way in which you or
I look at ours.
; He dreams of a
parade of perfectly drilled sub¬
jects, thinking alike, acting alike,
all moving to his single word of

balance sheet? Some

that

heritage .of us all'.
So ing ; the period from * 2 a.m:. On Hence the bank -' will be chargeseparate rivers fed, and Sunday, April 2.8, 1946, to 2 a.m. •able with diverting trade unfairly
hence comes their tonic, quality. / on Siipday, Sept. *29;;1946/ Dur¬ [after the US ceases to be the
ing this period local time in the main source of physically avail¬

them

iar form of

appear on

even

which

and
fam¬

discriminations

tions./May I put it in the famil¬

Zpf the items

our

ily .the life of the British people.
are proud
to pay tribute to

nized; ihe /wayrof (Operation and Chosen, directory.
pur loyalty is pledged/ But it can,- understanding is not always easy.
and 'should, be,/ the; rock, upon However complete our agreement
Which our house of peacb is built, mayyber on. the /large /issues,1Von
/:/ Bo for a .few: minutes tonight; minor questions we shall often
has tried to

Policy

(Continued from page 2216)

•

the

work of the organization to which

perhaps

of. Britain,

members

Our Trade

know, the spring of -freedom,
the banking
institutions in the lit is the job of the bank to make —such as taxes, fees, charges and
from which they rise, plotted .as
local Reserve District:
it "is" in/ history; law, .and. litera¬
;/'//!■%//• good the deficiency—in effect, to other exactions—most-favored na¬
tion treatment is required of each
/-"Daylight sayfng time" will be prevent US traders from • being
ture, and.in the thought and lives
in the cities of New at a disadvantage^ compared with country, throughout: the 28-year
of famous men.; some of yours, effective
period, v.; -'YY/ri • Y^:i:/Y. ^: '■
'•V-//
some of -ours, 1 but - everyone b? York arid.BdffalQYNeW. York/dur¬ exporters- from other- countries.

tity pf; rape, which does not exist

Such

that

moves; nor on

our

breathed
shared

an ; t-ion to
forward

putting

where the difficulties

tween

Paul's /Cathedral,

in-all-humility T like, to think of
this act as symbolic of everything
that ! Jhave felt here during these
five years, and of something that
I have tried to say tonight.
\ Let us then go forward into the
years of peace in that same com¬
radeship which it was our salva-

and the initial

apparent.:

affected by tradition, which leads
them' to /be. unaware 'of - the

yinced/that; in^the/last/resort/itls
larger understanding.
For. if we this community of thought that
/cam first wux when/theground is counts. ; Do /not /seek fto f ely ./on
so plainly with
iis, we shall be language/ which creates nearly as
that much better placed to win, many -misunderstandings as it re¬
are greater
advantages not so

St.

second question? Can you factof

and we retain

with.

people towards the British
Commonwealth and; Empire was

the

v«'^' *'*'v'!■**'*•

disrupted world there
that humanity claims
imperiously1 from
us' both;
so
,mu<?h that you -and we can do )toigether; arid* that neither of us can
jdo separately, YV - *;Y y/"/•'•■/,..
Many here will be familiar

your

gathering,/"I always thought < the changes of 150
British

yet

And. I must confess that I have
frequently deplored the extent to
which .the attitude, of many of

tradition;

and

much

a' reverent re¬ central shrine of Christianity in
gard,./; which/; is ; certainly ,: very 'the heart of London, which.as if
American/ for the various survi- by a strange miracle'' still stands
ivals And.; landmarks of the past. almost .unscathed/ amid the sur¬
Nor could any cause '.be better rounding desolation. A few weeks
commended in this country than 'ago .it was decided to dedicate a
jby association with the thought ; chapel in that great church to
of some of the great men in your Americans, who died after service
history; which is also of course in Great Britain; During "those
essentially an appeal to; tradition. Iweeks and months of service they

| coming relish, I might add the
tny son;, after

dislike

the

torn

compatible/. with

for

club

-On

economic.

and

this alleged repugnance is hardly

.To that slightly de¬

flating experience, which

and

questions; and I .tried, to
the best of my ability, toanswer

Risked

British are,hide-

by tradition,

Henry Benson, Warrant Officer,
been released from duty

AUS, has
and Is

now

Pollock

associated with

&. Co.;

Inc.* 20
Street, New York City.

Wm.

Pine

2232

Sees

Securities Salesman's Corner

Prospect of International Monetary Stability

{Continued from
all

By JOHN DUTTON

without

2220)
deficits
restrictive

page

payiuencs

resorting

measures.

Intelligent

speculation is based upon a
been

have

that

factors

numerous

verified

scientific appraisal of
to.' their

accuracy

Gambling is nothing more than guesswork, hupch playing, or some
action that is based upon pur-e

gossip. Incidentally "gossip" is more
stock buyers % today} than 'it has been for many

prevalent among
years past.
1

•

*''•

our

broker's

investment

customers

his

It also

be justified as part of any
dealer's personal operations, and those of

economy.
or

can

Properly

well.

undertaken,1 such

purchases

speculative securities should lead to successful capital appreciation.
In order to achieve worthwhile results from these ventures, certain
planned steps of operation along the following lines must be car¬
ried out:

•

Find a company that is in a position to exploit some new
product that has exceptional profit possibilities; »•- .'
.

4 (1)

Or,

(3)

Appraise the present market value of the company's outstand¬
ing capitalization. If such a stock appears to be an attractive
purchase marketwise, CHECK UP.
' .
'
1 '

•

Get to management DIRECT whenever possible. Meet the
who run the business/ Tell them that you are interested

(4)

men

iVi

future of their company. Explain clearly
that you are not interested in market operations, jiggles, or
gossip, but tell them the real function that you as a dealer
are prepared to accomplish. .That job is to broaden the market
in their stock, increase the investor interest in their company,
and meanwhile introduce your clients to a situation that you

in the longer term

believe represents a

investment) at this time.

'■H

[
t.

meritorious speculation (or possibly an
:

If management checks up A-l; if product, merchandising, and
financial position are also favorable, then you've got something worthwhile. Once you know all this about a company
you can really do a selling job on its securities.
"

(5)
/

Possibly there are some few salesmen who can sell almost any
security, whether they believe in the future of the company behind
it or not.
But these fellows are rare birds. Most of the time, the
rest of us have to believe in something before we can convince
others.
any

Sincerity cannot be synthetic—and no

situation

can

sincere presentation of

be based upon guesswork.

;

the magnitude and

contacts while meeting the management of

international trade, will be greatly
facilitated by the maintenance of
a
high level of employment in
'surplus' countries: such as the

United

States.

confidence in

Only
such

there

countries that

increased

that
it wouldj make
toward a
larger volume of imports, the;
steady maintenance of high em-,
ployment in the surplus countries
would help to relieve the world of

international crisis and pres-;
that characterized the 1930'si

the

sures

Great fluctuations in the

purchas¬
of the countries which;
are predominant in world markets
lead to booms and depressions in;
ing

enable the Fund and the Bank to

imports/will raise the
domestic standard of living and
not contribute to unemployment
at home will a greater inflow of
foreign goods be welcomed. At¬

avoid

tainment. of

orderly international relationships

to meet. The succesful
of

out

the

lending

carrying

programs

the United States and Canada will

being overwhelmed by the

high level of em«■
ployment with its accompaniment
of
increased
period. They will be able to con
consumption
will
serve their resources to meet the
permit a substantial increase in
needs which develop from year to the volume of imports without any
year and to exert a continuing in¬
decrease in domestic. production
fluence toward
international fi¬ of the same types of commodities;
nancial' stability.
and in those cases in which im¬
a

unusual demands of the transition

"Several other factors may! help
to

achieve

stabilityin
inter¬
monetary relationships.

national

Probably

;

important country
will permit large disturbing capi¬
tal movements in the future. Many
no

countries suffered serious disturb¬
in

ances

their

international

ex¬

shift away from
types of production in which the
surplus country is relatively less
efficient, the shifts can readily be

ports force

effected

some

if business is active and

employment high throughout the
economy,
"In addition to the contribution
t

power

markets that distort whole

those

economies

national

flucuations is

such

Avoidance

impossible.

render

and

esential to the full

successful functioning of the

and

The

Institutions.

Woods

Bretton

attainment of national and inter-

national

stability, however, must

be attacked as a common

problem;

both must be achieved together;

international

The

which

measures

Bank;

the

Fund and

the

constitute a part; are as

essentia}/

hationar development^

to orderly

....

they

dependent upon them "

are

change

relationships during the
thirties resulting from large and
international

erratic

Politics and Steel in Britain

short-term

capital movements. Several

coun¬

tries

developed the technique of
controlling such movements and
during the war almost every im¬
portant country was forced to con¬
trol capital

flows. The experience
thus gained is likely to be applied
in varying degrees in the postwar
period. While the Fund Agree¬
ment does not obligate members
to control capital movements, it

recognizes each member's right to
do so and any member drawing on
the Fund may be required to pre¬

•

Incidentally, it is often possible to make some excellent business
companies which you are

nature of the problems which the
Fund and the Bank will be called

older;company that is in the process of rehabilitation

(2)

pend partly

Intelligent speculation has a specific place in the normal func¬

tioning of

\;/
"The prospects of achieving in¬
ternational monetary stability de¬

of payments surplus, includ¬
ing the elimination of barriers to
ance

vent /large

outflows

capital

sustained

or
a

condition of further

of the Fund's resources.

use

i'v

(Continued from page 2218)
by the Prime Minister and the
Minister of Supply to an ensuing

barrage of questions by Conserv¬
ative
Members,
to i indicate
whether these or any other prin¬

ciples have been adopted. On the
contrary, these answers seemed to
confirm the impression that the
situation is left essentially fluid,
and that it will be the body of ex¬

included

perts

the

Control

Board, which is to be established,
who

will determine

the limits of

the nationalization of the iron and

The Prime Minister came down on
their

side, and those favoring na¬
tionalization had their way.
'

What were the political consid¬

that

erations
such
to

induced

statesmen

Mr. Attlee and Mr. Bevin

take

political decision on a

vital economic question? That thd
nationalization of the iron and
steel industry

formed part of the
which
the Labor
Party fought and won the election I
last year would not in itself be of
decisive importance.
But a num+
ber of powerful Trades Unions
came
down strongly in favor of
nationalization ; and brought the
utmost pressure to bear on the
program

companies are
steel industry.
of their own
"Most countries will have sub¬
As a result of this attitude, the
stantial
companies, AND OTHERS AS WELL. The very same motive that
gold and dollar reserves
Government has been subject to
prompts you to call upop them in order to make a firsthand investi¬ oh which they will be able to
sharp attacks on two grounds:
gation of what lies behind the stock in their company, is the strongest draw to meet balance of payments
And the Govern¬
first, because it has failed to re¬ Government.
argument you could possibly advance as a reason why they too might .deficits. Official gold and dollar
move
the feeling of uncertainty ment could ill afford to disregard
benefit from doing business with you., Every, time ybu ask another reserves of countries other than
that has been handicapping the their wish on the eve of the Labor
man to tell you about HIS BUSINESS you've interested him in ytou.
the United States are estimated
capital development schemes of Party Conference which is to be
at 20 bilion dollars at the end of
This method of checking up on the other fellow's business is scien¬
the iron and steel industry; and held at Whitsun in Bournemouth.
checking, on the basis outlined here. The directors of
often security buyers.
They buy or sell the; stocks

tifically right from the standpoint of an
any

intelligent investigation of

situation—it is also psychologically right as a means of increas¬

ing your clientele.;

Knapp & Co. Admits
RAPIDS,
IOWA —
Lowell M. Taylor and Sam S.
Johnson will be admitted to part¬

nership
chants

in Knapp
National

Taylor

was

& Co.// Mer¬

Bank

Building.

formerly a partner

in the

firm, in which Mr.

was a

limited partner

Johrison

prior to his

serving in the U. S. Army.

James

;

CEDAR

Mr.

Taylor

WACO, TEX.—James G. Taylor
will engage in the
ness

securities busi¬
Franklin

from offices at 321

Street.

Mr.

Taylor

became

member of the New Orleans Cot¬

in 1941. Prior there¬
to
he
was
Waco
manager
for
James E. Bennett & Co. of Chicago
ton Exchange

and

was

with

Norman

Co. and Weil & Gatlin.

Mayer &
.

compared to 7

the

end

8 billion

twenties.

the

Al¬

though large drafts on these re¬
serves
may be necessary during
the immediate transition period,
in

Waco

1945

the aggregate they, will un¬
doubtedly continue at a much
higher level than in prewar years
Annual gold production abroad
reached a peak of 1,300 million
dollars in 1940

and will

and 1941

continue to

second, because it has taken a
decision affecting Britain's
most important industry, without
having > worked / out
even
the
broadest outlines of a plan. Since
grave

it may take years before the Con¬
trol Board completes its task, a

large number of firms

will be left

for years whether
or not they
are meant to be na¬
tionalized.
Even graver is the
in uncertainty

supplement available
charge that, while rejecting the
foreign reserves. Although. total
plan submitted by the Iron and
gold and dollar reserves are not Steel Federation for reconstruc¬
distributed
among
individual tion under, private ownership, the
countries in proportion to need,
Government has not elaborated an
the

ability to draw on

reserves,

supplemented by the privilege of
using the resources of the Fund,
should enable most countries to
meet

foreign

temporary

trade
harm¬

alternative

plan.

That conference will have to decideon

the

application of the
Party/, for affiliation
Party. Most Min¬
isters are strongly against admit¬
ting the Trojan horse of the Com?
munist Party within the walls of
the Labor Party, and several big
Trades Unions made it plain that
their vote would depend on the

Communist

with the Labor

Government's

decision

the

about

nationalization of iron and steel.

This

explains the decision to

an¬

the nationalization of the

nounce

industry..

It
of

vagueness

There is

also explains the
the announcement.
to believe that the

reason

how¬ Government has no desire to go
nationalizing the works
ever, that the Government does beyond
engaged in the production of rawpossess a plan, at any rate in its
V The truth of the matter is,

It has decided on

materials—at any rate not in the

principles of its policy
of nationalization, and the experts
cases, however, the imposition of
will merely be called upon to ela¬
restrictions on payments for cur¬
borate the details based on those

life of the present Parliament. On

deficits without resorting to

ful restrictive measures. In certain

rent

international

transactions

be approved by the Fnud as
appropriate ; means of
meeting a temporary deficit.
•
may

the

most',

"Whenever
balance
become

that, a
payments deficit may
it

chronic

appears

and

due

fundamental maladjustments, cor¬
rective measures will be neces¬

broad outlines.
the major

principles. And yet, the Govern¬
ment prefers. to face a storm of
criticism rather than disclose its
scheme, or even admit that it has
^scheme, i
j
#

The

explanation of this strange
is to be sought in the

attitude

field.
Throughout the
discussions political considerations
sary. Changes in exchange rates, overshadow economic consideralong-term borrowing abroad for
tipns. A number of ' Ministers,
productive • purposes,V reorganiza¬ headed
by
Mr.
Herbert
Mor¬
tion or rationalization of produc¬
rison, Lord President of the Coun¬
tive methods, appropriate domes¬
cil, was against nationalizatioh !at
tic
monetary policies or other this
stage, on the ground that the
measures may be discussed by the
Government is not yet ready to
Fund with the member country
nationalize the iron and steel in¬
concerned as steps ^to aid in elim¬
dustry/ They were afraid that the
inating a deficit in'a country's in- inevitable
complications arising
ernational transactions. The Fund

will also aim to correct

chronic

political

from

surplus in the

son

hand, there is also

believe

that

some

would

the

Unions

rea¬

the

Govern¬

ment to go

much further. This is
particular with the
powerful Amalgamated Engineers
the

case

Union.

The

Government

may

rightly fear that if it disclosed its'
true intentions

some

of the unions

would not be satisfied and would

vote in favor of the affiliation of

the

Communist

Party.
On the
hand, it does not want to
complicate matters by extending
unduly the scope of the nationali¬
other

zation of the iron and steel indus¬

It is therefore trying to get
of both worlds by re¬

try.
the

best

non-committal,

maining
the

cost

tacks

even

of exposing itself to at¬
the grounds of lack of

plans.

.'/""//

;/■; -/,/.

sudden change of owner¬

indus¬
period.
The majority of Ministers, headed
ber country and may discuss with
the member possible measures to by Mr. Ernest Bevin were, how¬
ever, of the opinion that apart al¬
reduce or eliminate the surplus.
together from economic considera¬
"The adoption of measures de¬
tions, a decision to nationalize the
signed to eliminate a chronic bal¬ industry was a political necessity,
tendency toward

balance of payments of any mem¬

the other

ship might disorganize the
try during a very critical

Bradford

Teletype

J. C. Bradford

& Co., members

of the New York Stock
announce

"the

Exchange,

installation

Teletype—NY 1-2253
•in their New York office, 40
Wall Street,.
Bell System

...

Volume 163

THE COMMERCIAL & FINANCIAL CHRONICLE

Number 4484

2233

r'':;).;/1:.-'iV:;V*!"

liiliSi

RAILWAY IN 1945
Highlights from the annual report to stockholders
'/•

Q. What

the Pere Marquette's war hf v mature March 1, 1980 and provision has

was

made for

record?

mended it for acceptance by. all stockholders,

been V

fixed sinking fund of $250,000 semi-

annually with additional payments contingent -;
the Pere

A* Like other American railroads,

Marquette met the war emergency by performin

ice

its

received

history

the

this

For

company

advance,of maturity. $251>0oo

President of the United States, endorsed by

in ^945, An additional

the Director of the Office of Defense Trans-

decline

A. Railroad

revenues

generally

declining at

operating

revenues

A little

0f the

total

year s

operating revenues were earne

1929,

common

stock and nearly

rst

;

*«

the

creased

1944. Of

course

$45,558,794—5.41

amortization

cent

per

defense

The end result is

bringing this figure down

to $2 139 120.

Q. Do current freight rates reflect these
conditions?

?\\

.v'^-VA'

#'*V*At-*v

>: •

-Av.
-

;v-v.;««.

'•

vpnr«S

.7'S p';.

-;h

jV..r

material COblS.
,

;

(

restored?
.

i-r.

;

refinanced.

VnV

$64,535,000. By

■<

:tim

percent. The new bonds
-{

Jrom theJollowing sources:

A, '* :iVy?>,

•=>'

„„

$13,552,621.47

$39,729,620.90

.......,

5,553,433.54
8,469,545.76
2,748,086.50

6,219,211.10

232,125.92

99,274.73

783,239.02

786,444.43

-wutwiji

.waww

ToU,-<

■.■■■■■■,.

665,777.56—D
451,128.81-D
.137,817.04-1

3.920,674.57

Dividends from stocks owned

$3,823,000.57-D

2,610,269.46 v

I32!s5i.i9-i

3,205.41-p

uwmus*

A
$20,369,516.95

$20,638,656.91

269,139.96-D
70,771.72-1

2,660,194.30 " "

■

7,211.30-1

•

■

8,808,863.34'

"5,385,084.91

.9,081,134.61

;

2,667,405.60

% 110,981.19
-

' Other Interest.....;

Depreciation, amortization, and retirements.^w;

Total

423,778.43-D

^ax«com^?rc^
-y'

•-

136,324.47-D
323,070.88-D

1,755.57
4,724,527.47

1,015.38-1
3,275,398.60-1

$51,842,528.44 -

$49,671,815.08

$2,170,713.36-1

$ Wiemss

$6,843,157.48-0

'■465'597-64

0.970.202.64-0

s 2,29,20,4
s 2.042,070,4
e
^
income
was
asfo
oys.
• o
•
,
>spsitu>»
.-.^Appropnationsfdr.Sinkmgand Other Reserve J'unds.
416,666.67
-

si,369.9o-d

3,893,266.40
2,721,065.39 "

'<■

2,770.95'
7,999,926.07

^^taxe3'

142,851.09

:.;v

amounts received from others.
. 8,756,941.93
Intereston fundeddebtv,,2,397,994.51

This successfully completed/

nation.

A 7

.'Othe».:.«.^.«•;

launched in 1942 to rehabilitate "

February 1945, it had befen cut to $50,000,000
.

in operation.

Rentals and expenses paid for facilities used jointly with others, less

;

1945. the entire bonded debt

and refunded at oy%

transportation

prosperous

The Pere Marquette's faith in the future is
demonstrated by its decision to budget about
$10,000,000 for improvements and new equipment designed to increase efficiency and safety

Railway tax accruals, other than Federal and Canadian tax on income
Payments to contractors, associations, other companies, and individuals
i for services and expenses

;•

„

v'
x

det^Was

growing and

Kent for equipment of others used by us, less amounts received from

Marquette's bonded
!

the credit of the company. In 1942, the Pere

Materials, supplies, and fuel.........»9,151,906.33

'-:A■.

the program

••V-

A#' Yes. Early
was

"
;

demands of

Wages....

•

came

We disposed of our income as follows:

Q,
Has Pere Marquette
credit been
y-,"<■
.*

-.r
'

V-v:.', „• ;
i

such extent

compensate for higher labor and
/i^o+e A ^
! A f' A-!, ^"c.'J.-,■<v s
.

rwofiawiol
,

otheri1100"1®fromnonraUroad°Perations.

Ui'reUtti. I0KP1. ov>rl

J.n

ment and facilities to meet the

AV'v:.■'v.,:'-*•"

Revenues from hsuling coel andcoke,
Revenues from hauling passengers,.....
Other transportation revenues,.

permit the railroads to

necessary to

and requirements by providing modern equips

e uni ca ion pjx)
mcu mg care

Revenues from hauling freight other than coal and coke

tliiiPprA Msrmiottp

raise freight rates generally to
w

SOURCES AND DISPOSITION OF INCOME
^-f4:'v/:A

0»r income

years, me management 01 tne rere marqu^tte

should

•

firmly believes that the Interstate Commerce
Commission

•

lates the urge to keep abreast of developments,

Wfl? thslnwp^t in twPTltv-'lPVPll
was tne lowest m iweilty-beyeu

This rnflDao-PTViPrif Of

...

upward trend, the 1945 freight

rpVSTiiiPhppiinit
revenue
per unit
'

■

every

opportunity> together with

■

A. No. Although prices and wages continue
their sharp

the

to hold the public

way

marked improyement in railroad credit, stimu-

study of past learnings and future prospects of
the Pere Marquette, advantages of unified
operation, and the value of securities offered
to Pere Marquette stockholders—the Board
of Directors of the Pere Marquette unanimously approved the proposal and recom-

decrease of 28.98 per cent

corai era ion o»

811 mi e

of similar charges in 1944.

net income for 1945

«.

orpug

over

which

projects

this does include $5,004,927 for

exeess

operating expenses in-

contrary,

$3,654,869 in

xhis

financial assistance from time.to time. After

•

good will which is now being expressed in

the C&O and that road has also rendered needed

T)i(l nnmiJni*
nUa i\eeVme?
y. ma operating expenses aiso aectme,
o

A. On

^ ^ return tQ peacetime ec0nomy>
rauroads will find

and traffic relations have been maintained with

;

for the accomplishments of gains in both fields,

half of the

one

Dunng these sateen years, close operating

the war's end.

improvement in operating effi-

upon

v'-:i

capital stock of the Pere Marquette.

eight months. Tins shows the ffirect effect of

A. The upward trend in wages and price"
continues with freight rates, so far, remaining
static. Future earnings, therefore, will depend^

$49,449,000 at

Railway Company has owned about 70 per cent

the peak year of 1944

of the

a a ou
A. Since

for the future?

are prospects

largely

for 1945 were $51,500,687,

73 per cent

over

acquired

ciency-^and .greater pr^uctivity from-man,-,
e ProPose
^ V * power and dollar investments. Research- in the
the Chesapeake and Ohio
field and in the laboratory must be relied upon:

have-been. AiJ

of the Pere Marquette,

down 8.53 per cent from

Q. What

cancelled

1945.

increasingly rapid rate since

V-J Day. In the case

were

the end of 1945.

revenues

merce

of the bonds

$300,000

the nefc bonded debt gtood at

;

Commission for approval and authorization of the merger,

least

jn 1945 and will be tendered in 1946. Therefore,

portation.

Q, Why did

delivered to the sinking fund and

were
•

made,

are

$30,000,000 of the bonds will be retired in

letter of commendation from the

payments

The agreement will be submitted to stockholders at a meeting on .May 7,1946. Application has been filed with the Interstate Com-

earnings beginning in 1948. If all fixed and

contingent

ing the greatest amount of transportation serv-

^Balance;remaining;for othe^corporate
T,
*,
'diof.

purposes^,.....,............

$ 1,722,454.17

PERE MARQUETTE RAILWAY, General Motors Bldg., Detroit 2, Mich.

$ 3,012,075.68

416,666.67-t

$1,289,621.51-D

.
.

-r

THE COMMERCIAL & FINANCIAL CHRONICLE

2234

question but that

attempt to

any

it is impossible as yet to state exactly just what form

course

railroad reorganization

legislation will take, but at least by now it
some change in reorganization procedure

that

assume

For

is inevitable and imminent.

some

time the House has been im¬

patient with the results of Section 77 proceedings, as evidenced by
overwhelming approval of the earlier Hobbs bill;
The Senate,

its

and

particularly Senator Wheeler,**
opposed the House measure and Interstate Commerce Commission
it was never enacted. Now, a sub¬ reorganization plans were
orig¬
stitute bill sponsored by Senator inally promulgated.
It .may * be
Wheeler
has
been
unanimously possible to realize the latter aim
approved by the Senate Interstate
Commerce Committee. There may
be
some
minor changes in the
„

bill

either

Senate but

the

House

by and large

the

legis¬
the

new

lation will presumably follow
Wheeler bill fairly closely.

Theoretically the new legisla¬
designed to expedite reor¬

ganizations and to protect the in¬
terests of junior security holders
through recognition of industry
changes and changes in the status
since

roads

some

degree. On the other
hand, new legislation will be cal¬
culated

further

the

delays

rather

than to expedite consummation of

reorganizations.
The

bill

•v'..?:/:/"
i"-; "
provide that a

would

vountary iplan

tion is

the individual

reorganization
be worked out, within six months,

longer time as the I.C.C.
may permit. The first part of this
provision would appear to assure
speedy action but this-is nulified
by the
be

of the Commission

power

extend

the

recalled

provided

limit.

time

It may
77 also

Section

that

time, limit for submis¬

sion of plans, but with the altern¬

ative that the time limit might be
extended. As :a

Chicago Railways

of roads

Cons. "A" 5s, 1927

zation

result^ a number

have

.for

been

reorgani¬
years
without

many,

making
any' progress
formulating any plan. ,

Chicago, Milwaukee

holders of the bonds.

also have to take into account the

amount

further

of the

to constitutionality.
almost certain that, even

seems

though
the ; Wheeler
bill
is
changed in some aspects any new
legislation will encourage, if not
actually suggest, the use of cash
.

Ardeu Farms

Common & Preferred

for

the'

reduction

Where there is

Saskatchewan

„

4V2s & 5s

claims*

simple capitali¬
zation with no question, as to pri¬
ority of different bonds on income

Province of

derived from

specific ^mortgaged
mileage, this; consideration* will
probably not be too troublesome.
Where

there

divisional

are

liens

number

there

Stock

Exchange

and

120
231

So.

LaSalle St.. Chicago 4,

Specialists in

Division A and B

Moreover,
the
formula
whereby the
earnings
contributions of the individual di¬
visions- has been determined' will
treasury.

subject to litiga¬

presumably be

tion.

where? there- is

Even

flict

liens

divisional

between

con¬

New

mort¬

blanket

the

under

issued

There are many rail men
who feel that legally it will not

gage.

be' So

long as there is
back, interest due on the
simple

Each

bonds.

holder is- cer¬

bond

tainly morally entitled to a pro¬

portionate

this

excess

cash. If he does not wish to have
his share used for the retirement
of

debt,

secured

equally

even

though that debt is to be

acquired

and retired at a discount

from the

face- amount
difficult to

the

see

it ps

claim,

how he

can

re¬

quired to relinquish his claim to
the cash which normally should
be

utilized

terest

for

payment

his bonds.-

Apparently there

also

in¬

- ■.

•

some

idea that it might be feasible
reduce

interest

charges

retroac-

•••••:

tivities

PHILADELPHIA,
PA. -r Sus¬
pended since 1942 asawartime

dent

and

di¬

the

...

Bell

traditional

Bond Club

Stock

in 1933. He
e n

e te

d the L Vincent H, Herrmann

(

Forces.

;

-ntrnummur-r

Shepardto Expand

■

Mexican Pub. Serv. Go.

spe¬

later;
wilt provide a full program for
the daylight hours. As in pre-war
days trading in the Stock Ex¬
change will be for valuable prizes.
Dinner will be accompanied and
followed by a "whooping old time
Bond
Club
show"
according to
the broadside
announcement, pro¬

vided

member

talent, •-with

outside help. ;,V
Wallace M. McCurdy, of Thayer,
Baker & Co. is Chairman of the
some

Field

Day

General

Committee.

Members of the sub-committees

Arrangements — Samuel,- K.
Phillips, of Samuel K. Phillips &
Co., Chairman, Clyde L. Paul, of
Paul & Co., Inc.; Golf—Walter A.
Schmidt, of Schmidt, Poole & Co.,
Chairman,. Bertram M. Wilde, of
Janney & Co., Kurt J. Huttlinger,
are:

—

banker

owner

Public

who

of the

has

be¬

Mexican |

Mr. Shepard, who is a partner
in the investment firm of Shepard,
Scott

and

New . York

Co.,. 44. Wall Street,
City, purchased all of f

the stock and debt of Empresa De
Servicios Publicos,de los Estados

Mexicanos S. A. as the company

officially

ley^ of Stroud & Co., Inc., Chair¬
of W. H.

sale by Standard of its

known,

the

from

Standard Gas and Electric Co. The

investment

the Mexican property

"The

states

;
Sonora

or¬

was

dered by the SEC in 1941.

-" 4
and

Northern

John E.

company, which are immediately^
south of Tucson, Arizona, on the

Sinaloa

served

the

line of the Southern Pacific Rail-

Company (Del.),

Corp.,

■''v;i

;;

•

Show—Edward

Club

Jr., of E. M. Fitch & Co;,

Chairman, Loring Dam, of
Dillon

Co., William

Barclay, Jr., of Stein Bros &

Jr.,"of

way,

W. Miller, of E. W. &
Co., Edward Boyd

Harrimari,

Ripley

Co.,

of vast areas of newly irri¬
gated tracts of rich agricultural
land," Mr. Shepard said.
M

• ■»'

; /The Federal, Government hgs
constructed - and
is completing

large irrigation dams, which to¬
with the introduction v of
new
and
important
industries,
form part of a development proj¬
gether

ect! conceived and sponsored by
the Governor of Sonora, General
Abelarde

Samuel Evans, Jr., of C. C. Col-

ing

lings & Co., Inc.; Registration &

rich

Michigan Central
Grand River

Rambo,

SUTRO BROS. & CO.

-i

Members New York Stock Exchange' v

SK i

■

."*

120 BROADWAY, NEW YORK 5, N. Y.

Telephone REctor 2-7340

Inc.,

Keen,

Chairman;

Rodriguez, for the

open¬

and development, of this

territory."

Tricario in New York

Kerner,

Transportation-'—

Rocco

Tricario

engaging

Inc.,

Chairman;

Publicity—

at 226 East

R., Conoyer

GETCHELL

Miller,

Eighty-seventh Street,

New York City.

;

::.

Lehigh Valley Railroad

MINE, INC.

General and Consolidated 4S-4V2S-5S, 2003

UNITED PUBLIC UTILITIES

Adams & Peck
63 Wall Street, New York 5
SOwilng Green 9-8120
Boston

Tele. NY 1-724

Philadelphia

Hartford

•

UNITED PUBLIC SERVICE

Circular Upon Request

Mclaughlin, reuss & co.
Members New York Stock Exchange

1. h. rothchild &

ONE WALL STREET

co.

Member of National Association

52 wall street

of Securities Dealers, Inc.

HAnover 2-9072

n.y. c.

Tele. NY 1-1293

Harry D. Brown, Jr., of Stroud & the securities business from offices

Valley
4s, 1959

•

Co.,

TEL.

HANOVER

Finance-^Raymund J.' KernCr^ 'of
i**1. * >.••••

Service

P. Ristine & Co., Frederick
Seving, of.Burcher & Sherrerd;
Stock Exchange—R. Victor Mos-

£oyce, £

•

')*
;

Co., arinounced plans for the expansion
of
operations by : the MexicaH
utility.
-*
; ■
v.
|v'
;
Following y/ord tbat the Securf- v
ties and
Exchange Commission
had formally approved sale of the
utility, Mr. Shepard revealed that
plans for private placement of se¬
curities are being formulated in
order "to supply additional eleqtric capacity
with the help of
American capital and engineer¬
ing"
i '
State

of F.

Quoted

sole

come

Shepard,. New York

Eastman,"

57 % Cumulative Preferred — 6 % Cumulative Preferred -«♦;

Sold

Theodore E.

investment

cial events to be announced

Chairman.

Teletype—NY 1-310

?,Prospectm.on. Request

Northern States Power

■

—

Ex¬

Co.; Races—George J. Ourbacker, of F^ J. Young & Co., Inc.,

Bliss Company*

—

pSKmo dm

service short-*

■

change, together with other

Inc.,

Bought

company

ly after Pearl Harbor and served
May 17, by a colorful gather¬ for some time in the Southwest
ing^ at the, Philmont
Country. •Pacific with :the .Far East Air

R. C. Miller &

?/'•

of the or^

$2.2£ Convertible Preferred
'

Presi¬

Vice

the

measure
the
annual
Field
Day
outing of- the Bond Club of Phil¬
adelphia will be revived this year,

,; Bpnd

.are
experiencing a sharp
Chairman,
S. growth in population and pros¬
Howard Rippey, Jr., of Reynolds. perity resulting. from the opening

York Stock Exchange

Telephone—DIgby 4-4933

New York 4, N. Y.

re¬

sumed his ac¬

one

curities

all Times

Telephone BOwling Green S-640Q
Teletype NY 1-1063

duty

v e

has

and

ganizers

man, Albert W. Tryder,
Newbold's Son & Co.

New York 6

E. W.

a c

re¬

from

f i r in.
M r.
Herrmann was

Fitck,

25 Broad Street

been

„

For Banks and Broker* '

has

Broadway

GUARANTEED RAILROAD STOCKS-BONDS

A. U. S.,

rector

C. Bogan, Jr.,
Sheridan, Began Co., Chairman,
Fricke, of Thayer, Baker
& Co., Richard
Clayton, of Lazard
Fr eres & Co.; Tennis—Paul Denckla, of Stone & Webster Se¬

Members

nel,

leased

re¬

Clulp.
capitalization
with
a
Announcement to this effect is
blanket mortgage) the use of cash
being made by Spencer D. Wright,
will present a difficult problem.
of-Wright* WoocF&, Go.y President
It may sound all right to say that
of the club.
i
\ t
*
£
the cash may equitably be used
^ Golf, tennis,^Wt -ballr-and .theto request tenders* of the bonds

simple,

tenant C

Soft Ball—John

RAILROAD

Selected Situations

new legislation will be
delayed for an extended

$1,500,000 on division B it can
hardly be.claimed that each has
a
claim on an equal amount of
the cash remaining in the- com¬

pflugfelder; bampt0n & rust

Inc., 48 Wall
Street, New York City, announce^
that Vincent H. Herrmann, Lieu¬

each have shown net earn¬ cent wage increases^ which will
ings, determined by formula, of make even more difficult the
$5,000,000 since trusteeship^ How¬ formulation of; a voluntary plan
ever, if it has been necessary to wnich will be realistic and accept¬
spend $3,000,000 on additions and able at the same time.betterments to division A and only

pany's

;

C. J. Devine & Co*

may

111.

SECURITIES

All in all,

then it may be taken for granted
that any ^reorganization affected

the

V.-P, of G. J. Devine

gravated in their decline by

earnings.

Railroad Bonds and Slocks

Broadway, New York5,N.Y.

fight

ions

other

leading Security and Commodity Excha.
I

been

i"-•

MEMBERS
York

little

Ernst&Co.
New

has

that

without

accepted

period. Meanwhile, earnings will
retreat from peak war levels, ag¬

any

that

of the provisions

bill will be subject to

new

judicial test

5s, 1975 & 5s, 2000

of i cash

Herrmann Resumes

This would hardly

spent on additions and betterments
to the division out of that divis¬

Another factor of delay is

presumably all

& St. Paul

towards

outstanding,
change in

now

the? interim

interest rates.

such

bonds

on
reflect

determine exactly
which bond the cash belongs to.
This can not be determined by the
earnings contributions of the in¬
dividual divisions alone, but will
to

is feasible to

tively

Thursday, April 25,1946

distribute cash will bring with it

litigation

■M.

Sl:

\W4

NEW YORK 5

2-1355

Philadelphia Telephone

TELETYPE NY
-

Lombard 9008

1-2155

/j'.t

Volume 163!-

THE COMMERCIAL & FINANCIAL CHRONICLE?

44-S4

Number

Fact Board Recommends l6-Genl

•

X •'

recommended bv the fact-finding emergency

were

!«&

of Montma, Chairman; Frank
and Gordon S. Watkins, of Los

City,
made to the President on April 18^ according
dispatch^' which -further: goes or*^
-

board composed of

recommending rthe: 16-cent

•••

and En-

written into

said

whether

would

a* further

asked.

Such action

increase
..-v-.

•

was

taken

April

the contracts between the unions

and

operating • v unions
representing
1,050,000 employees, who also re¬

the carriers

"New

April 19, the

Times"

York

states

by representatives of 15

non-

fhe Montana Supreme Court; Mr.

is retroactive to Jan. 1. The dis¬

ditional

Swacker, attorney, of New York

patch added;

hour, the difference between the

j Under

emergency

employees,;;

provisions

the

railway

pay

was

the

and

the raise, which
by' an arbitration
board, these unions have not yet
awarded

crease amounts to

increase—amounting to
of

held in Chicago from March

were

pro¬

ginemen, April 3,

the wage and rules case

union

Brotherhood of Firemen

with

was

12 to April 8 before the three-man

title d to that amount to compen¬
sate for higher living costs. This

rates

ings

satisfied

in¬

pay

awarded to members of the

switch men's

exten¬

hour

board, former Justice Erickson, of

the carriers and the

1941,

crease

16-cents

of bargaining"

area

eyidence clearly showed that the
engineers and trainmen were en¬

January,

The

V?'-

Two Other Unions

months, but Also brings on the
possibility, of a new request for
higher wages. Although both the
Carriers and the unions were dis¬

mutual advantage of both

vide "a wide

io the

President granted

••v'-*

increase, the board stated that the

18%

the

to an Associated Press

vl^^fthe board continued, would
In

Pay Rise in Pacts of

vides that no change may be made
in the conditions giving rise to the

M. Swacker, of New sion of time to enable the board
Angeles, in a report io prepare its repprt. Public hear¬

Leif Erickson,

York

mit its

certain changes in work¬ dispute. In the present case, fol¬
engineers and. .trainmen, lowing agreement of the parties,

Wage increases of 18 cents an hour and
ing rules for more than 200,000 rail road

■

{lays tO;hear thq parties and sub¬ Science, University of California,
'recommendations, and for Los Angeles. \
:
/
;
thirty days thereafter the law pro¬

Hour!y Wage

il Increase for 200,CfflQ in Two Rail Unions

2235

the

and * Mr.

City,

labor act a Presidential

dean of the

board is given thirty

Watkins,

who

Chicago

The formal

tracted

College of Letters and

dispatch.

news

$1.28

action

The

in¬

day and

ends

pro¬

controversy lasting several

ceived

award of

16-cent raise.

They filed notices seeking
increase

ad¬

cents

award and the original demand oi
30 cents.

—

represents the maximum amount
allowable under the government's

stabilization

wage

of living
aiso pointed

cost

formula. The' board
)out

that''similar

been awarded

increases

Texas

had

and

April 3 by two ar¬

bitration boards for about 85% of
the country's rail
workers. In-*

pgj

eluded in the report was a certifi¬
cate ' :that
its ' -recommendations
were j in
conformity with ; the

stabilization program.

v / **

New Orleans Railroad Company

■ «-

| frAmong the 44 changes: ih' rules
submited by the two brotherhoods
-and the 29 presented by the car¬
rier's were many which the board
found
has f some" basic
J merit.

Invitation for Bids

$15,000,000 First and Refunding Mortgage

% Bonds, Series B, and

$45,000,000 First and Refunding Mortgage

% Bonds, Series C.

Texas and New Orleans Railroad Company; hereinafter called the
.Company," hereby request? bids for
>
'

■

abolish

quired
"would

rights the unions had

ac¬
;

half,

over

century :v or

unreasonably

roads' costs.

rail¬

boost

/ ^

•
-

•

manded to the parties with the
pointed observation that a reason¬

v
.

able revision of working rules by
impartial agency could be ex¬
"only by cooperative as¬
sistance of the parties" and, fur¬
ther, that the subject matter was
extremely technical and a "slight

amount, First and Refunding Mortgage Bonds,-;
(hereinafter called the "E(onds of Series B"), to be dated April 1,?.

bear

The Bonds of Series B and Series C will .be guaranteed

unconditionally

bidders. If a bid is signed
!by a representative on behalf of a group of bidders, each bidder makes the
Representative the bidder's agent, 'duly authorized to bid, to improve or vary
>the bick to receive acceptance, or refusal thereof, to receive notice of closing, to

bonds in the

i denomination of-$l,000>
or as
fullyi registered bonds in. denominations set
& forth in the draft of the Circular hereinafter mentioned..They, will be. redeemable at the option of the Railroad Company, as a whole, or in part by lot,
oh any date, on not less than 60 daysl published notice,'at prices determined in
:
accordance with the formula applying to optional redemption set forth in the
'. draft .of the. Circular.- -lV.wf.'

rtanc e" might I afford
claims running into
hundreds of thousands of dollars
ve

'./%v,:-;

the destruction of vital rights

of employees.
'

The board recommended among

other rule changes, overtime pay
at time and one-half for extra
men

from

in yard

or
bids, for one, .or both of-such Series. A bid for the Bonds of one of such
^iSeries may not be conditioned upon the acceptance of a bid for the Bonds of
r:the other Series. However,- a-bid for the Bonds of both such Series may be ^
^conditioned upon the acceptance, of such-bid in its entirety (in such case stating1
'•
the pri.ee offered for each such Series), but no such conditionaPbid will be
considered unless the bidder or group of1 bidders making the same shall also
make another bid or bids unconditionally offering to purchase the Bonds of.
Serjes B, and unconditionally offering to purchase the Bonds of Series C. I;.:!.: : ;
Bonds,
t*7

'
Pursuant tor the' First Supplemental Indenture; to the First and Refunding
Mortgage, the Railroad Company will 'pay to the Trustee *6n. or "before- April
1st in each year, beginning on April 1, 1947, as a Sinking Fund by* which the
bonds of any series issued under the ify** and Refunding Mortgage, other than
Bonds of Series D, may; be retired, (a) a sum equal to one-half of one per cfent.,
of. the principal-amount of Bonds of Saries B and. Bands of Series C, theretofore
authenticated and delivered under the First and Refunding Mortgage, as supple-

;

service,

an ♦increase
52 cents to 85 cents a day in

the differential between yard con¬

■■■■-..

payment

to engineers operating
multiple-unit: motor or electric

any

(ii)

accordan.ee with the power
productivity of the combined
p6wer units operated. It also rec¬

cYiqII

km/A

hoon

rotirorl

nt*

ckall

koim

nftofurnrl

nolloH

koon

rtr

fnf

Alif\*ntinn

ommended

that

carriers

provide

rfo

specific
made

was

Hilt

short

turnaround

passenger

service, the board declared that
fh& i currbntf: excessive ; spread v of
hours was not in harmony with
:

the generally accepted eight-hour
day and that the situation should
be remedied "without delay'' by

form

Vfeatherbedding" resulting in

of
ex¬

cessive payments to the men, the
hoard observed that neither party

proposed to abolish, this system of
payment. It pointed out that in
decent years

railroad management

]had been stressing

what

de¬

scribed as "eight hours" work for
f'eight hours" pay and the brother¬
hoods had • been advancing claims
for Excessive pay rules: when op¬

timum

hot

operating conditions
realized.
Both
of 'the

were
.

ap¬

proaches, the board asserted, were
urged, as a construc¬

change their
nize

that

measure,

each

rights.

Such

both

L^
^

•

••

action,

Company,: Suite 2117, 165 Broadway,

New

♦

nust be received .at that office on or before 12 o'clock
York 6, N. Y. All bids must
Noon, Eastern Daylight Saving Time, on May 6, 1946. Bids so received will
be opehed at said office promptly after 12 o'clock Noon, Eastern Daylight
.

Spving^Thnq,

...

Each bidder*may attend the opening of bids'in

or by duly authorized representatives. Each bid must be accompanied
.•
—
—
*
by certified or bank cashier's check or checks in New York Clearing House :
funds, for two per cent. (2%) of the aggregate principal amount of the bonds
of the series bid for, payable to the ordef of Texas and New Orleans Railroad
Company, such checks to tie returned except to the accepted bidder or bidders.
The deposit so- made by each accepted .bidder, or group of bidders, will be 7.
provided in said Form of Bid, on the purchase price or
as
to which
such bidder's bid was accepted, and the '

person
t-

•

said date.

•

i._

remainder thereof returned as in said Form of Bid provided. No interest will
^ allowed on the amounts of checks furnished by bidders.
, ;i,The RaUroad Company reserves the right to reject any and all bids. Unless
the Railroad Company shall reject all bids, notice of acceptance of the most
favorable bid or bids, subject to the approval of the Interstate Commerce

—j-—.
lowest net interest cost,, arrived at by. computing at i the. rate named m each
;instruct, at private sale or in the open marketv but at a cost (exclusive of
bid, interest-for the term of each Series on the; full principal amount and
accrued interest, brokerage..charges and other expenses) not exceeding the re¬
deducting therefrGin the premium, if any, or adding thereto the discount, if
spective sinking fund redemption prices, exclusive of accrued interest,, for such
any, resulting from.-the- price named in such bid.
.bonds, on the date, o£ such purchase.; or, if not redeemable for; sinking fund,
-a;therespective optional redemption prifces,* exclusiveroi accrued:interest, of such
successful bidder or group.of bidders will be furnished with a favorable
t r '
hr»nrT«
if
nrtt
0{>inion * of MeSSTS. GfaV0th, Swaine fit MOOTe as tO the Validity of the First
bonds nri
on ' 4-Via
the drite rtfr
Of curti
such • purchase,- nr.
or, if. not redeemable, the nrinrirknl,^vi'
principal
an<f Refunding Mortgage, of the Bonds of Series B and Series C,- and of the
amount thereof,:
Except as , otherwise provided in "the First • Supplemental
guaranty
thereof,• and the successful bidder or bidders shall have -no right
to
Indenture, the Railroad Company may, at any time -on or after April. 1, 1947,
vcall; for redemption for^^ the Sinking Fund an amount of Bonds of Series B or
.
refuse to purchase the Bonds of Series B, cr Series C on^ the basis of any
031'
Series, C or bonds of any, other ; series, issued unden the First and Refunding -" c ; questions^ as to such validity^ such favorable opimon shall be furnished.
Mortgage, which are redeemable Jor "the Sinking".Ftmd,%r some of each/Up ,.A .dopy of• a .draft erf the First Supplemental Indenture and a copy of the
7
to the amount, which will exhaust, the moneys then in &hig Sinking^ Fund, 'All;
.
First and. Refunduig Mortgage Xto.;which.. reference is made for a more com-:
rb'st;
5 bonds delivered to the Trbstee for aqcount of the Sinking Fund or purchased1
; S Plete description of ; the terms of the Bonds and the rights of the holders
t
J:
or redpemed fey the application of moneys, in the Sinking -fund, shall be Ran-v
7 thereof), a Ropy of a draft of the Agreement between Southern Pacific Com*.
celled and no bonds shall be issued in lieu thereof.
;7 7; 7
7
*
^
P®nYguaranty of the Bonds, and. a copy of the application to the
providing
for
the
Interstate,
V
Commerce Commission and accompanying exhibits are available for inspection
7
.
The issuance of the Bonds of Series fii arid Series C and the sale of $15,000,000,
at the office-of the. undersigned,. Suite !2117, 165
-principal amount,-of the Bonds'of Serifes B, and $45,000,000,, principal amount,
Broadway, New' York 6,
-;of the Bonds of.Series C, and the
N. Y.f 'and at the office of the Trustee, Chemical Bank & Trust Company,.
griar&rity thereof, require authorization of
165 Broadway, New York 15, N. Y., and at the office of the Treasurer of
7',
the Interstate Commerce' Commission.! Acceptance of any bid or bids will fee
i
."
subject to and contingent upon obtaining'Such authorization,
the Railroad Company, 913 Franklin Avenue, Houston 1, Texas,
-\!i .-j'''.
—4_._x

—

.......«

±..

....

cAd ^ Trustee^under the First- and Refunding Mortgage

•

TEXAS; AND NEW ORLEANS RAILROAD
April 24, 1946.

wilt.be given orally, "or by telephone or telegraph, to the success,
ful bidder or bidders or to-the Representative or "representatives of the success^ \
bidder or bidders not later than^ one o clock P.M., Eastern Daylight Saving ;
Time, on May 7, 1946," and all bids shall be irrevocable until that time. Any
to the Trustee for the Sinking Fund; shall beepplied by it to the purchase >
bid not accepted at such time will be deemed to have been rejected. The .
of bonds of. any "series issued at anytimeunderthe First>andRefunding
:iJ determinatiori:of;thfi mostfavorable bid-fbr each Series (B or C),* or for ^
Mortgage, other than i-r;
Bonds
of.
Series
D, as the Railroad, Company may
Bonds pf Series, B and Series Cf collectively, will be made on -the. basis qf the
!:
.r
,

Bids must be enclosed

Any payment intOithe Sinking Fund may be made atthe option of the Railroad ':"0.
Company either in cash or in bonds- of any series issued at any time under the
'First arid Refunding Mortgage, other thari Bonds of Series P, at the principal:
;
amount thereofi or partly in cash and
partly in such bonds. All moneys paid
>

;;

bids for both of said Series.

; Texas end New, Orleans Railroad:

W°?'•
no ^ ev£nt
«8SrJe8at«. P^cipal
!UC? B^m.d''lwhlch?i®t th^ respecfave Bmkmg Fund redemptum pnees
J ^ can be redeemed .with the monejrs payable for such

with accompanying papers, in a plain envelope, securelyV sealed, i bearing no
indication of the name of the bidder or bidders or the amountj of the bid,'
'jriarked "Bid, for Tex'as and New Orleans Railroad Company First and Refund*
mg Mortgage Bonds," and addressed to J. A. Simpson, Assistant Treasurer, '

bid

parties

fundamental

course

-nx-,

..I.

the maximum

attitudes and recog¬
other's

fallacious. It.

tive

•

deemed by it to be
unless it accepts

year into th6 Sinking Fund on account of Bonds of Series B and Series C.

'.*;

pr; hburs for road train And. engine
is

and

fSilli
f
.

;

employees

°I

direct bargaining.

service

even

most advantageous, but will not accept a -bid for Bonds.of Series B or Series C

sinking fund payments required to be made in the pp
next succeeding year in respect of the sinking funds for bonds of all series
then outstanding which, under the prqvisions pf the First and Refunding Mortgage and the-provisions of such bondsy rank pari passu with .the Sinking Fund.
the amount of net income available for such sinking funds shall be prorated
among the
sinking funds
rphps
of
in
orooortion
among the sinking
funds for
for such
such series
of hnnds.
bonds, msnectivelv.
respectively, in
proportion
to the maximum amounts which would be payable into such sinking funds,
respectively, in such succeeding year if the net income of the Railroad Com* 7 <5
pany for such calendar year had been sufficient to make such maximum pay- T
ments.
The amount to be paid into; the Sinking Fund in any year may be

recom¬

Commenting
on
the
rather
Widespread publicity that the so-,
balled dual basis of pay of mileage

sti

case^ the net mcome'of the Riilroad Compahjr for any_ calendar year
shall_ be ^insufficient- to' provide fpr; the . mOTimum ^ smkmg^fund;_ payments
Fund

the controversial so-called
"eighth
Within-ten" hour rule prevailing
in

revising

...

;tributed to persons of whom the Railroad Company has knowledge as being
v >■ possibly interested in the purchase of the Bonds.
Copies of the-draft- of
:
Wiasi- rkia
frrim fkiS nni4nrotty^o<T
ranennakta
QUfllltitifiS

or (b) a sum equal to the amount available therefor out of the net income of
V the Railroad Company for the preceding calendar year in accordance with the
provisions of the following paragraph,| whichever sum is less.

•

Although

...

......

expense-of purchasing and main¬
taining required uniforms.- J ' • *\
mendation

information concerning the Railroad Company and the Bonds, is being dis-

and

"watches at" cost where inspection
is required and that the railroad
and employee share equally the

date herewith, the obligations of the several members of a group of bidders
shall be several and not joint. All bids must be submitted in duplicate on the
said F6rm of Bid, .which," together with the draft of Circular setting forth

■

cars in

sinking fund for bonds issued under the First "ancl Refunding Mortgage,
the principal amount of Bonds trf Series B or: Bonds of Series C which
l8hall have -matured or which the Railroad Company shall have called for
redemption, otherwise than through the operatiop of any sinking fbnijj for bonds
issued under the First and Refunding Mortgage,Aut which shall not; have been
presented^-for payment, and (iii) in case all the Bonds of Series B or Series C

ductors and yard brakesmen and

r :

•| accept delivery of the Bonds and generally to represent, act for and bind the
•buyer in respect to the bid, its acceptance; refusal, improvement, Variance or
'performance, and the! representative, warrants that he has such authority.
Each bid must name a specified price, plus accrued interest from April 1, 1946,
.to the .date, of delivery.
Each. bidder or group of bidders may submit a bid

grounds for

! may be made by a single bidder or by a group of

principal and interest* by endorsement by Southern ...Pacific Company.
as coupon

^.interest rate, and .will be sold to Southern Pacific. Company

i-:|vf] The Railroad Company invites bids for the purchase of the entire issue of
Sjthe Bonds* of" Sbries B or of thet Bonds of .'Series C/ or ofboth' Series. Bids

*.,The Bonds' of Series B and Series iC will be issued

the vsame

at the same price per $1,000 bond at which the .Bonds of Series C are sold,
i f The proceeds oi the sale of First-and Refunding Bonds of Series B, Series C,
and Series D, will be applied to the payment of the principal amount upon
redemption on July 1,-1946, of $64,255,000, principal amount, of the Railroad
Company's First and Refunding Bonds, Series A, bearing interest at the rate
of 4l/t per cent, per annum, and maturing January 1, 1987, at 105 per cent,
of the principal amount.. thereof plus accrued interest; to the payment. of
$7,178,000, principal amount, of bonds ^underlying the First and Refunding!
!Mortgage which are now past due and payable on demand; to the purchase at
its depreciated ledger value of approximately $7,000,000 of equipment leased
v.by the Railroad Company from Southern Pacifie Company-and Southern Pacific
; >Railroad Company; and for other capital* expenditures."
" "
'

2. $45,000,000, principal amourit, First and Refunding Mortgage Bonds,
Series C ( hereinafter called the "Bonds of Series C"), to be- dated- April- 1,
1946; to mature April 1, 1990; to' bear interest (payable semi-annually on
April 1 and October 1 of each year) at a rate (which must be a multiple
of Vgth of 1%) to be named by!the accepted-bidder; and to be secured
by the First and Refunding Mortgage as supplemented and amended by the
First Supplemental Indenture.
j
7
'* < 1
'

:2 to both

pected

Commission will also be sought
fpr the issuance and sale to, and guaranty by, Southern Pacific Company of
$20,000,000r principal amount, of Texas and New Orleans Railroad Company
First
and
Refunding Mortgage. Bonds, Series D
(hereinafter called the
:"Bonds of Series D"), to mature April 1,. 1990. The Bonds of Series D will

i :f Authorization from the Interstate Commerce

„

1946; to mature April 1, 1970; to: bear interest (payable' semi-annually on
April 1 and October .1 of each year) at a rate (which must be a multiple
°f V&th of. 1%) to be named by j the accepted bidder; and to be secured
V by, the Railroad Company's First; and Refunding Mortgage,. dated, as of
-January 1, 1938, as supplemented; and amended by the First 'Supplemental 'i
Indenture, dated as of .April 1, 1946 (hereinafter called the "First and
Refunding'Mortgage"),, to Chemical Bank & Trust Company, as Trustee,

: Pue do time limitations, k* large
number of proposals were re¬

L-$15,000,000, principal,

Series B

;

Others were characterized as "ex¬
treme" which, if adopted, would

''Railroad

;

COMPANY

By J. A. Simpson, Assistant Treasurer

2236

<J\

THE COMMERCIAL & FINANCIAL CHRONICLE

Subsidizing the British Empire

way

nished her

the

United

States,

The

British

the

any

Government
accounting
to
her
investors in British money or se¬
curities.'
'

*!'1

ii.

;

; The British are by
strapped. It has been

that

their

assets

tries than

means

coun¬

$8,000,gold re-;

some

their unmined
serves have been estimated to be

tional

w_orth at least

made

000,000,

their
as

diamond

reserves

billion

several

Britain also has
in

dollars

and

Northern

cash.

thority
June

granted

it- by Congress
1941, to enable RFC to

10,

make

loans

had defaulted
us

after

such

au¬

loans

vestments

their loans from

World

War

this

Feb.

the

from

taxes

presently

000

by in¬
The

the

country.

RFC loan is payable over a period

This is approximately

year.

average

years.

the past

over
\

helpful

still protect

our

the
own

Treasury

in substantial
part, I suggest that the RFC in¬
its

crease

loan

Britain

tion

where the money is

spent,

rate

ent

loan

and

the

to
the- interest

that

balance

and

the

pres¬

$1,000,000,000

additional

the

be-2%, with all net
to be applied, first, to

interest

the

loan

and

the principal.

hold

the

If these

they have
over the past dozen
years, and in
all probability they will
increase,
the loan would be
entirely repaid
in about 40 years, and the British
would

still

their

own

profitable

investments in this country. />//:
This would give Britain $1,000,-

000,000
wants

cash

it,

immediately,1 if she

and

gressional

without

action.

Con¬

any

that

suggest

the

RFC

make

operations in this country, up to
the earning value of the
security,
upon the same terms and condi¬

2% interest, with
additional earnings applied to
loan, and that the proceeds

all

COMPANY

the

is,

of such loans be available to Brit¬
ain

SUMMARY OF 1945 ANNUAL REPORT

with

where

This

restrictions

the

ALL
SECURITY

HOLDERS:

also

can

done

without

might, in.

The

1945

year

Interstate

was

important to

Commerce

security holders of the Company.

Commission, the Company's

Special Federal Court—each placed
pany's Adjustment Plan.

all

few

hundred million

their stamp

On March

bondholders,

and

of approval on the Com¬

1944.

pany'^

Operating

expenses

for 1945,

The President has recommend¬
$25,819,818 less ,than

were

$18,571,715

tax

ment of

credit

costs and the charge

account of amortization of defense projects.

$14,990,255.

Total

taxes

This resulted

paid were $20,074,255.

State¬

earnings, expenses,and disposition of net earnings for 1945 follows:

Year

EARNINGS:

1945

" V:

j
•

Compared /
with

.3/;

and

future

use.

The

etc.i.__—

rents,

Total

6,790,888

$25,819,818

950,407

$368,164,106

$26,770,225

EXPENSES:
i\•«',.f.*;

Payrolls, fuel, material, etc
Taxes

$296,661,547

„

Equipment and Joint Facility Rents,.:..

'rr £

debt,

rents, etc

Total

■

9,592,793

20,074,255

28,910,590

7,984,975

1,838,082

$324,720,777 /
All other-r—interest

these

and

can

601,309

$352,262,705

$21,757,188

15,901,401

necessary,

5,013,037

4'.vV<v

3,553,498

Sinking funds—to retire debt,,.;.

Total

improved

track,

bridges,

acquisition of .new
<Ars.

invested in

was

and

signals,

This resulted in additional

nomical operations,

program

intensified,

and

traffic

equipment

projects

were

;

issued

amounted

$5,183,560.

Total

$39,105,577.

Other debt

during

1,723

5,098,410

2,842,849

This

was reduced

other

was

are

freight

traffic,

for B&O

started

facilities,

and

0$ V.

more efficient

and

several

years

heavier

finance

being

and

ago

tonnage

equipment

the

$10,616,040

$10,601,431

REDUCTION, 1942-1945 INCLUSIVE,

WAS

than

purchase

obligations

outstanding,

1945.

the

have

also

with

been

the

Company,

employed.

...

and

articles "

the

1,300

us.

the

present

loan

insure

not

agreement

that

she

will

end

THE

were

1945,

1944.

NET

DEBT

additional

servicemen

British

give

our own economy.

that unless
lend her X billions of
to

say

her

terms, they will be
-impose trade restric¬
tions, dollar blocs, etc., is not my

forced

idea

"fraternal

between

the

cated

association')

United

Great Britain

States

and

eloquently, advo¬

by Mr. Churchill,

does

nor

it square with the kind of friend¬

ship

that

have

shown

the

British in two world wars, with-j
out which friendship the British

Empire
stroyed.

would

have

been

de-i

It has been testified
istration

countries.

from

case

certainly is differ¬

other

countries

want money from us.
the only country that

that

Britain is

has asked
give her money.
At least,
other country, \ t0Vmy< knowl-?

edge, has been brazen enough to
ask for a;money gift.
It
Lord

will.> be recalled that when
Keynes and his associates

first

came

over

they said they
to consider

get the moneyj
in "no mood"

were

loan.

They

in¬

were

sisting that we give them; some
$5,000,000,000 or so/ True, after
long weeks of haggling negotia¬
tions they reluctantly agreed to
borrow the money on a nebulous
promise to pay in five to 55 years,
at a very low interest rate, and
that payable only when Britain's
trade balances

were

favorable. /

the

will

dollar

promoting
a

world

agreed

Britain

fund, and
would sub¬

$2,600,000,000

funds.

Woods,

world bank and

stabilization

that

scribe

Bretton
a

•

mar¬

■

only owes about $80,while
our
present
debt is approximately $272,000,000,000—or $2,000 for every man,
child

and

woman

the

—

message revealed that we have
already authorized and proposed

invest

ernment

furnish

it,

she

since

states that unless we let her

now

have

the

able

she will not be
participate in the world

bank

money

and

nancing. In a more recent meshe proposed further increas¬

stabilization

Another

can

buy it to its best advantage.

The

measure

was

heavily debated

House of Commons only a

few

days

vote

ago,

two

carried

and
one.

This

means

fund.

ity

our

over

and

sale

been

in Brit¬

period of five to 55 years,

where her
The

now

the way there for about
on
the dollar, payable

at ah interest rate of

iy2%,

$6,000,000,000

unused materials
on

Britain

that

trade
of

little

over

payable
only
justify.

balances

these

materials

has

in the United States.

sale

commodities

can

through Commod¬
Corporation or some

not

will

farm

pur¬

could be made

Credit

other

already sold

than

consider¬

executive depart¬

our

have

ments

criticized by the
(formerly th'e
Truman Committee) but nothing

requirements

The

point worth

ing is that

Government

exporters

by
provision for

agency,

with

cashing their drafts

at the Treas¬

ing the lending authority of the; >
Export-Import Bank.
;
It is time that we stop and ;
think where we are going, that we
take stock of our resources, of our ;
earning capacity, of how we are
to service our own present heavy j
debt before we undertake to play
,

Santa

Claus

world.

the

rest

the,,;

| The United States with 5.8% of
the world's land
the

and 6.1% of

area

world's

population A- cannot
single-handedly finance and i rebuild a war-torn, confused world.
The
time
to
recognize this is
.

now.

We should stop issuing Govern¬
bonds and pay every dol¬

ment
lar

can

and

now

spare

fast

have sold

debt;

our

can.

Government bonds

our

to the American

people, upon the
basis and representation that they

constituted

the

soundest

ment that anyone can

only

can

them

sound

invest¬

have.

They
make

sound,

by cutting down on
#expenditures and stop
to countries that?
have no reasonable assurance of/;
being able to repay it.
/! Another very important point
our

own

lending

money

think

not

has

been

proper

for anyone to get a clear

war

picture

soon

the
the

future.

Britain

over

here

shooting stopped
She is smart, has

"to get hers."
always been smart, and, incident¬
ally, very selfish..

]
To

XI.

up—I have suggested

sum

Mead

severely

Committee

be done about it since it does

require the approval of Con¬
gress.
These
executives
have
also agreed to cancel for all time
any

obligation

British to

ever

the part of the

return to us, or

additional RFC loan to Britain

$1,000,000,000 on the security we
already hold; that further RFC
loans to Britain be made

Brit¬

ish investments and operations in
this country, including such gold

she

as
we

willing to pledge;

sell

Britain

cotton,

that

tobacco,

fruit and other farm commodities
and manufactured goods on cred¬
we

follow the Presi¬

recommendation/and

critical

cents

wherever

for¬

sage

dent's

cotton

$17,000,000,000

loan$5gndyihternational:H^/

eign

■

ain

its

United

and

figures A cited
by
President Truman in his budget

States

600,000,000
which
she
readily
agreed to put up? It would look
to a suspicious person as if she
expected the United States Gov¬

Britain

these

The question arises now: Where
did Britain expect to get that $2,-

ket, and, instead, the Government
buy

;

000,000,000,

the

sight of

prominent part in

the

overspent.

j thatf I:

VII

of other countries that

consideration
is
that it is entirely too early after

to have: lost

seem

will

;

ire furiKKr*

until

currency

given;

the

100-year-old free cotton

chased

R. B, White, President

■

byAdmiri-f

spokesmen that the

continue

of Britain is different from other

ent

our

ton

employees of the Company.

never

dollars

her

two-way street.
been much inter¬
threats, and
for the

4/1 have

announced its intention to discard

in the

their

acknowledge with appreciation the continued

That is
ested

cause

other sanctions that will

seriously affect

its

cooperation of stockholders, Government
agencies, shippers, and the officers
and

tions

will

continue trade restric¬

afford

cannot

it, and that

that less and less of Britain's cot¬
The President and Directors

terms

fail¬

Cripps,

Trade, and Lord President of the
Council Herbert S. Morrison, the
British Government already has

'/;/■

her

impose

our

printing and spending money in¬
discriminately, however
admir- /
able the cause.
Every time we
spend another billion we are re¬
ducing/the value of our dollars,
and if we go oil spending and
lending and • giving and losing,
without ' regard to how we; are
going to pay back the money that
we
borrow, it will not; be long

agreements.for

tobacco, fruits and other
farm products, durable goods and

$105,021,264.

nearly

give Britain $3,750,000,000

that

■;

:'"lV

cotton,

markets, and will.
Through Sir Stafford

new

31,

Of the 17,857
employees of the B&O who entered the armed
forces,
than 200 lost their lives.
Of the
rest, nearly 7,000 have resumed

employment

believe

President of* the British Board of

Equip¬
of

retired

December
at

not

spend
those
dollars
with
our
farmers, manufacturers and ex¬
porters. She will be free to spend
them in competition with us in

eco¬

Congress.

ure
on

before

now

pro¬

any

fur-.

//CVlIX.

Keynes, took

the

loan

the

world

making encouraging progress.

1945

and

than

people

for,

many
billions
lend-lease.

I further suggest that Congress
consider authorizing' the sale of

Congress that lend¬
ing Britain dollars as is proposed

and .passenger

foL

are

knows that and hurried

to remind the

5,013,037

suggestions

the

the fact that Britain through Lord

In this connection I should like

patrons.

obligations

total

promising

$15,799,600;

equipment
'

and

service

development

research

obligations

sources

and improved

efficient locomotive performance
ment

yards

consider

ports of such items from

815,853i

15,901,401

improved locomotives

might

credit, in amounts equal
approximately to her normal im¬

I'D

posed

years

the construction of new and

1945 in

ster-

them in dollars.

making Britain an advance pay¬
of, say, $500,000,000 to en¬
able her to get the materials out.
RFC employed this method to
help Chinaand Russia before
lend-lease was applied to those
countries.% The loans are being
paid according to agreement. \

does
Nearly $27,500,000

/1) $ 1,352,612

8,411

7,241,082

appropriations

Added- to the
Company's surplus.

done.

many

United Kingdom for the next few

GS:

Other

for them in

pay

manufactured

sell

can pay

$21,155,879

27,541,928

This should

British

Ting. We

buy crit¬
stockpile pur¬
them away for

put

these

American

for

ment

$361,373,218-

[dividends, interest,

1944

Congress that

materials

poses

From

ical

of $296,661,547 were the largest in the Com¬

history,fprincipally because of increased material

during the next few year§> and, in
my opinion, on a basis that would
be much more acceptable to the

IV.

13, 1946, the Court entered its formal

of $361,373,218

ed
revenues

/up

dollars of

her gold now in this country.

Decree, directing that the Plan be put into effect.
Operating

pinch, put

She
a

The

on.'-J*

lowed, Britain would get substan¬
tially what she needs from us

money shall be spent.

Congressional action.
TO

carried
v

request to
the RFC by the Federal loan ad¬
ministrator approved by the- Pres¬

tions—that

RAILROAD

now

further loans to the United King¬
dom on British investments and

;

it is

$1,000,000,000 on the
present security, with no restric¬

THE BALTIMORE AND OH

our

This

manner.

same

would
not 'interfere
regular export trade as

procedure
with

ident, is all that is necessary//;

cashed in the

additional

earnings

British.

and

Federal

loan

pledged security is about $37,000,-

provided

secured

were

after

British

earnings

The current income

$194,000,000.

that

governments

due

balance

order

balance

the

RFC
of

from- the
sale
of
pledged collateral have been $24,565,000 and from the net income,
after taxes, $171,575,000, leaving

$425 million to the
United Kingdom of Great Britain
under

taken, down

was

$390,000,000

any

Payments

loan of

Ireland

The

companies.

Only

July, 1941, the RFC author¬

ized

American

owned

requirement that
the collateral be sold.

much

British

insurance

$15,000,000,000, and

$8,000,000,000.

after

cipals The security includes the
net profits, after taxes, made in
this country by 41 British insur¬
ance
companies operating here,
and the capital stock of 40 addi¬

estimated

other

total

ours

income

all

taxes, from all the security would
be applied, first, to the interest
on the loan, and then on the prin¬

''Mr'c^y.

■

and

collateral

our

years,

compensate

any

part

with interest at 3%.
loan agreement provides that
sales by the British of the

(Continued from page 2221)

Manufactured products and
goods could be handled
a Government agency or by
exporters and their drafts

durable

ury.

Thursday, April 25, 1946

materials

for

buy
stock-pile

h/v-

purposes.

British

the

are
unwilling to
pledge of the secur¬
ity behind their present loan from
the RFC for new money, I would
give no further consideration to

continue the

loan to them of any kind.
We
it to ourselves, as well as to
the rest of the world, to approach
a

owe

this

whole

pletely
is

the

matter

realistic

manner

a
—

com¬

which

only forthright and sound

approach.

Approval of the proposed loan
now before Congress would start
the

United

cial road

States

that is

down

finan¬

likely to lead to

disaster.

Too much spending and
lending and losing is a sure road
to ruin.
The Congress should not

ignore the dangers that lie ahead.

Volume 163" Number 4484

•••

.'■

'.,X<

.•%i. yk

y*>"-

,'Hk

> -,

us#

2237

V"!./'* '

JjA

•' ■

■ "*'

'■

RHtiB-

,7'^' '*' '

M ^

V,''^;v,.>. VV'x
',1 '^'

>>'

,'"»

'■ ; A '

*' v1

11 *

•,

:->r' *■,

l-^PPs

;•

pyv^

xy||}y§^

F RAN C I S

y.' S A

CO/CALIFORNIA

:,h'{

:
i'

''i1,.

;..___

7X-

^■rjr<'p4
v
'

•/' /jf

Lck,

elec-

?*'*. ^ j; ;

^g9in, tHe Company is devoting its efforts and resources to promoting and providing for the continued

;

^ ■'•

.F7

j.'. ~~T.---r;. .'T.y

~7t.'

-"r ~^*-> 7—, **.- j

*1^','*?' 7^',',".:'-, .'■ !r r-',•".•■'-7

«'

''v.''. •"

/»

n!'

,1' '■■

'•

•■>•

;{■

•.

7,™^

Ahmnof^. \(|f «A».unj« »u»Cii **

«??{<**••«&

r,s'$& I,,; *

for American industry in general the successful comple-

'v.';;;;5 trie and gas service in its field of operations were met promptly and fully.{'Now that peace has come

:N'!' ■'

QUTH P».M

AKIPP

Company,

tiOn of one important task and the beginning of another. During the war, all demands for essential

cout

l«
■

The Year 1945 marked for this

J'/

Mwtew.i

^ S
y

,!./

NIVIM BHHU

'•'

Oft-

jjl'J

**C''"'7"
*ML

Following the end of hostilities thefe was some recession in our industrial load; hut sales to domestic
ind commercial customers continued to increase. The decline in revenues ftorn war industries was more

i
'■

■

in Aliirtii

il>ni«* rtilf'rtf ?WlViA,ririprto

n/iMil/iA

/ilrtnnnn /if

AiiovVtinn

lii/vt£iv

mfho

rttrnvnivo

anii

•

fAtol VAironiioa IInnil

'to**i'.;;

W t-'-rsiK.
\r
»
»irf V;'1
KC'rar *
.

bales; or electricity tor the year jtotaled tyg inliion kuowatt-nours, wttnm Jl yo 01 tne iy^ record,

.•

Gas sales reached a new peak of approximatelyl36 billion cubic feet, more than 8% above the
preceding year. There were uninterrupted monthly gains in the number of customers served.

fvy

*±lake

In 194f> the Gomnanv Will benefit substantially from lower Federal

\iA

«...

x. ^

fiiL_
"aeRlM^G/

-:\w\

"A,""4-

1/4 4'";'^. '■ A

""Sfec
Bycyprt.

piv

'^MC

' vvy/ X

EtEcrpic

...»

•

'r v

„

. J.

'.
7'

V./iXr''

■

!
,

GAS

qENfPArim'

PLANTS

.I't'-1...

■

T.-'

•'

'I'

■

J; '".'

■

16.8% less for 100
W kilowatt-hours
IVUUTIUIMIUUJS of electricity and
U"« 38.4% less for 40.6
'

it ;V"-

'•f.r-'i'

Few

g|
-<
mmipi
q»i;

deiul&ui SPefaned

tlierms;
'

iSiri

-l-T*

ti.nvt:

/MM

<«»i

4^.

Vvv»

/-virv

A X*

corporations in the country enjoy

vl-*

;

iTxti

*-*'!>•

I-W

y-vr »r-*^

■!«

wider distribution of stock ownership. At
.

/it

troiiXtnai,AUflw nnn^h^A-1

^42,

gaip of 12,5^7 within the

%
-

each, indicating wide distribution among sm^ill investors.: f

"s\

•

-1

year.

\ V
'.^4''':'iV'::.''y./*'

yjv/f-xyyy

i '' *

■VX

-.;v

xr,BY;:TI

V'"""

' '

•*

a":

it;

^Spi'lft

PACIMC GAS AND ELECTRIC

MfC.„

»»«

■■
__

DECEMBER

jiue

DISTRIBUTION

SOURCES OF GROSS REVENUES

COMPANY
■

■■

°f natural

OAS TRANSMISSION UNI ■ *: ' •

I'V

TRANSMISSION LINES

STANDARD-PACtriC
.

I'll".

pay .•*-",V/W
-Jf",/

>i.

f-tfCTRlC TRANSMISSION UNES

X'.'

xl
•
.1
.„1^:..iihX -. J 3Aorinon
gas than the average prices for these consumptions in the period 1935-1939.
:'Meanwhile, adjustments in wages to employees have kept pace with increased living

„

-t~-r

'■*"'■

.jXSjk^r• .'"t, 7

I,*''*!'

%
/

early in 1946.
y
^
'
The downward tfend of the Company's rates is in sharp contrast with increasing
living costs. Under pur new rates a typical residential customer in San FrancisOo will.

XC^vA^r-

ivr'."1'

atry, were iurther reduced

J,/ll yy'1

""'

resumption of rate reductions, temporarily ^halted by,the. war. Throughout our his-'
\
tory, such reductions have been made whenever possible. Accordingly, rates for gas
j/,"'-}''i»r''
'

k1^/!

'.y /■

income, and

savings, wnne parrmiiy onset cy nigner operating costs, are sumcienr 10 ename me

JSjp&iHIx'p.l
,

taxes on

19 45

$117*7* KM
$112,676,586

Gas Department

46,662,136

Water Department
.
Steam Sales Department

viOHipnny u|jr;»aica ou Auicgt«ic;u system cjueiiu-

ing into 46 California counties with
estimated to exceed 4,000,000.

FlpPlripFlpnurlmpnt
Electric
Department.. ■

population

offelechic

Women

and

Total

$160,269,447
-

cas

•

19 4 5

57,672

39,931

Joint Tenants

26,294
"

Tmot Feints

| R

Men

—

Electricity is distributed in 142 incorporated cities and towns, 225 unincorporated
communities, and an extensive mal areA» Gas is distributed In 103 incorporated cities

STOCK,OWNERSHIP
D E C E M B

570,720
360,005

and towns and .70 timncoroiorated'communities. The combination

(
OF

Aoo

•

„•

'/^X^xX'

x-yf.'
*

.!,;f

f ??-

■';■

*.>"?

7.7XXXXX
I

gfiidtna <?Mea((.

SUMMARY QF

w'V
'

•

CONSOLIDATED EARNINGS STATEMENT
T

'V'

•J

Year Epded December 31

.v;

[ • ;\1y

Gross Operating Revenues

\X.TXX ivH-ty !v\"^

..............

and' Anorotinrr T»

vnAncPC

JI60^,«7

-fiAVP^hf FAnPth IV-fflYiiiG krir»
v'r.x-.''v.ii':, 4": <?'->
on
p; f I. / $ I • ftj ■ f,

$151^,236

J '•'', /Axy.

•* *

318,056

*■« <-t 1 *• **

*^11

the nation,

movement

of population and

*/T

now

industry. It is

parent

that the industrial, agricultural and commercial

of this

area

/' -34,182,215

319,083"

-A

.ranns tnira in population, ine war served to accelerate an

117,591,021

.33,161,866 7

; v
x

significant westward

California, long one of the fastest gi-owing states

•

; rv

127,107,581

r^'

are

will continue greatly above

of the opinion

pre-war

levels.

ap^

that under normal condition's stability

can

best be achieved by striving for expanding markets and

production, with unit selling prices

„

with the maintenance of "satisfactory service, fair-wages; financial

■

;

development'

increased

the lowest levels consistent

•

33,480,949'

34,500,271"

j 'i

11,528,935

;x,

.;•:

«t

>.f\

12462$#

•

;>21,952,0lM
<:x.

/•

.y'i, '4
r* 1

■

8,427;353

j
•

*22,037,339

•

;

8,409,851

T2,523,898;

Balance; j.; ly.-'7.7 \ X'
fv
>.

\ v./V'-'iy

;x.j $

Earnings. Per Share of Common

pividends paid Per Share Common Stock

1,000.763

13,627.488

y
-

rr \

■

T: .' 7;

•',-

X*-'"-

forward with confidence to.-tbe continued

with

•••

COPIES OF

•

progress

increasing opportunities for rendering

j. j ice at low co^t to the public, i y J r.■■■■.": ;

$..1,103,590 ;y

our

look

high standard of

v-.$2.00 »-<:■■ $}!:,$2.(j'Q
as

those

serv-

;->y•

re-.

fry ;„,

T'-;,'Xfi/XiVVi,'yv''v:':i;7 J~;p

Si-■''■J-/-.

.t I,,. .. ■ V

E.J.BECKETT, TREASURER, 245 MARKEl STV $AN FRANCISCO 6, CALIFORNIA

.y-

business,

$2 18

•

return to investors. To this end,

12,523,898

$2.16 f -

-*Sfated on, the basis .of cjurrent operations, without giving effect tp non-recurring tax reductjpns such
suiting from bond

refunding operations

•■

soundness' and a reasonable

X7l3i24;66i:.

.ryy

i:..J'■

' w't;

.:'AItk I.

J-

i$." j)'i

i WK' rfit*.

2238

(Continued from page 2214)
which is the power

that holds the
state together.
When reduced to
its lowest terms it is a proportion

Fa i

.,V: please."

THE COMMERCIAL & FINANCIAL CHRONICLE

response

•

bler,
house

The

what

nor

was

than a cob¬

the

value

in terms of shoes.

was

This

was

Bible,

fair

even,

wages

what

each

careful examination,
man

actually

wants

the

rule

rather

than

the

was

S|.

this

From

high, most
not

marry

realistic

theory,

is, is right, it was but
to the idealistic opinion that
ever

step

■'}

■

,■■■'

some¬

found

that

wage-

earner's family consisting of man,

of 13 and girl of 8,
require to meet the gen¬

wife,

boy

would

examination

the

budget
in question seems to show that it
should be sufficient for a stand¬
ard of relative

comfort, inasmuch

it allowed $978 for food, $179
for medical care, $137 for auto¬
mobile upkeep, $113 for life in¬
as

surance

premiums,1 $350 ' for the
purchase of war bonds, and sev¬
eral

other

rather

allow¬

liberal

From figures like" these it is
evident that there is no limit to

ances^ But who shall

ply
were

and the

ingman

employer make
nevertheless

say

human wants, and that, if the sup¬

in the

RUM

where it is stated: "Let the work-

goods and services also
unlimited, justice in distri¬

bution might well be expressed in
the slogan of Utopian socialism:

free;! agreements;

"From every one according to his

there underlies

ability; to

dictate of nat¬

ural justice more imperious than
any bargain
between man and

that

namely,

ought
support
frugal and well-behaved wage-

man,

not to
a

earner.

wages

insufficient

workman's..wage

be sufficient to

enable

him

com¬

Thursday, April 25, 1946

;

would

36%

getting
their

over

1941,

as
of

crease

of living

his

according to

every one

needs."

But

even

the

United

States, the most prosper¬
ous country in the world, the na¬
tional product is not large enough
to give every one all that he could
desire.
Wherefore, as in Soviet
Russia, the Utopian slogan must
•

fortably to support his wife and be modified thus: "From every
according to his status." In other
words, a just wage was a cus¬ ered to be fair, regardless of the his children, he, will find it easy, one according to his ability; to
tomary wage and, as in ancient terms, and an employer might say, if he be a sensible man, to prac¬ every one according to his work."
parable
of tise thrift and put by some little
times, laborers were expected to as f in the ancient
A standard of
living, therefore,
live as their fathers had lived, and laborers in the vineyard: "Friend, savings"
£ ■' 'V':/
measured
by the needs of one
%the upper classes, "the discrete I did thee' no wrong; 'didst thou v; Forty y.ears later Pope Pius XI party to the labor contract, cannot
issued another encyclical in which be the sole basis
elders," were only too glad to keep not agree with me for a penny?"
of a fair wage,
he vindicated and developed the A
them in their proper station. / f1
wage is not a gift, nor an ex¬
The Subsistence Theory
After the Black Death, which
teaching of his predecessor, while action
by force or fraud, but a
In support of this opinion the noting that the welfare of the
destroyed a large part of the pop¬
payment for service rendered, a
ulation of Europe, the effort to economists of ^France and England enfployer also must be considered,
quid pro quo, and must be deter¬
keep wages down took the form developed the' notorious subsist¬ thus; "The condition of any par¬ mined, on the side of the em¬
in England of the Ordinance of ence theory, often called the iron ticular business and of its owner
ployer, by the value of the service
Labour of 1349, in the reign of law of wages, according to which must also come into question in to him. To the worker a
wage is
Edward III, which required that the wages of common labor could settling the scale of wages, for it
income, but to the employer it is
workmen and servants "shall re¬ not permanently remain above the is unjust to
demand wages so expense or
money cost, and as
necessary s to : enable
the high that an employer cannot pay such cannot and will not
ceive only the wages, liveries, hire level
long be
to
live and reproduce them without ruin and without
or salaries which used to be
of¬ workers
paid unless the money value of
their
class.
Thus
the
Irish
banker
fered
consequent
distress
among
the
in
the
the product created or the service
places t where he
should serve in the 20th year of and economist, Richard Cantillon, working people themselves.".
rendered is sufficient to cover the
wrote 200 years ago: "Men multi¬
Somewhat
similar
is
the
our reign
posi¬
of England, or in the
cost.
.
;
f
five or six common years last ply ; like mice in a barn if they tion of Father Charles Antoine;
At first blush it looks as though
preceding." However, the same have unlimited means of subsist¬ S.J., who says that perfect justice the
question of fairness in this
Ordinance required craftsmen and ence."
requires the recognition of two
connection were merely a question
factors: the minimum cost of a
merchants to sell their labor and
Subsistence
wages,
therefore,
of justice between two parties—
decent living for a workman and
wares
at reasonable prices—re¬ being natural and inevitable, were
the payer and the payee, the em¬
minding one of the work of the regarded as just and, unless - the his family, and the economic value
ployer i and | the
employee — as
of
hi&
labor.
OPA in our own day.
;
growth of population could be
when ia housekeeper employs*/ a
Such
efforts
to
keep
wages checked, y it
was
thought - that / .More specific is the dictum of coqk or a patient consults a phys¬
down were repeated from time to nothing could be done about it. Mr. Justice Higgins, President of
ician.
But in ordinary business,
Commonwealth where the
time, but in/a few cases the laws No wonder that, in view of such the i Australian
employer has something
Arbitration
provided for the fixing of mini¬ pessimism,
the
Scottish
cynic,
Court, who, in the to sell, as in farming, manufac¬
mum
famous
Harvester
Thomas
wages.
Thus, in the year
judgment of turing,
Carlyle, stigmatized po¬
merchandising,
mining,
1630, the weavers and spinners litical economy as
"the* dismal 1907, took as his standard "the transportation, and what
not, at
of-Wiltshire complained that they science."
normal needs of the average em¬ least
*
u
three parties are concerned:
"were not able by their diligent
ployee regarded as a human being the
employer, the employee, and
Standard of Living Theory
labours to get their living by rea¬
in a civilized community," and the
buyers of the goods produced
son that the clothiers at their will
But presently a much less dole¬ estimated that a weekly wage of or
services rendered who, in the
have made their work extreme ful theory was developed as it was 42 shillings—about $10—was
last analysis, are the actual em¬
hard and abated wages when they found that, in regions where the
needed to maintain a family of
ployers ;of ; labor.
Fair wages,
five.,
\
■
therefore, must be such as will
;- "For the year 1929, when the cost
be fair to all concerned, will per¬
of living in the United States was mit of fair
profits and fair prices,
slightly lower than in 1945, Pro¬ and, as Professor Pigou puts it,
fessor Paul Nystrom made a study will
"maximize the national divi¬
of various standards of living un¬ dend."
J
.

(

urban

conditions

that

and

con¬

family of five re¬
quired a yearly income of $1,800
for bare subsistence, $2,100 for a
minimum of health and efficiency,
and

$2,400 for a level of comfort

and decency.

recent

budgets prepared
by the Division of Social Research

the

Works

Admin¬
istration give estimates of goods
and services needed on June 15,

1943,

our

four-person

INVESTMENT

Progress

ily would require

Members
York
Other

New

Leading Exchanges

that, in July,
the average manufacturing
worker was turning out each hour
22.9% more product, measured in
1945,

physical units, than in January,
1941, from which he infers that
a wage increase of 54% would be
necessary to restore the prewar
relationship of wages to cost of
living and labor productivity.
^
This final figure looks like a
wild

guess, and Mr,. Murray is
surely overstating his case, espe¬
cially in view of the recent state¬
ment by Henry Ford II that "on
the

whole
productivity in our
plants declined more than 34%
during the war period." He is in

also in

error

stating that the Hel¬

ler budget made no allowance for

savings, and he has probably
estimated

the

rise

INVESTMENT SECURITIES

Private Wires

•

STOCKS, COMMODITIES

Home Office: Atlanta

•

Phone LD-159

;

Cause of Wave of Strikes

The

present

sttikes

wave

illustrates

well

serious

the

com¬

plexity of economic .relations, the
difficulty of harmonizing the con¬
flicting interests, and the elusive
concept of justice in distribution.
One

cannot but sympathize with
Philip Murray, President of the
Congress of Industrial Organiza¬
tions, as he tells how the workers

over¬

the cost of

living, while the Bureau of Labor
Statistics has probably underesti¬
mated it.

However that may be, it is not
surprising that the workers in
our
manufacturing industries, in
view of

the wartime wages

cost
of
living, are v asking • for
higher basic wage rates. And yet,
the employees of General Motors,

whose

wartime

weekly earnings
a
par with the Heller
budget, could have earned almost
as much if they had
accepted the
corporation's offer of a 45-hour
were

week with

rates

6% increase in basic

and

the

usual

half for overtime.

time-and-a-

The offer

was

rejected by the Union as "reac¬
tionary," but it had considerable
merit as looking toward increased
production, the only source of
prosperity and higher standards
of living and the best antidote to
inflation.

Wages

Antidote to Deflation?

Mr. Murray's second line of ar¬
gument, however, assumes that
higher wages should be, paid as
•;

antidote

for reduction in

deflation

make

Federal

ex¬

penditure of something like $25,000,000,000 during^ the fiscal year
ending June 30, 1946. Here he
invokes the popular and notorious

purchasing

power
theory which
prosperity comes from

holds that

spending and that, at the slightest
sign of deflation, the Government,
Stuart

"spray
power

Chase

has

said, should
purchasing
into the system,"
additional

Oddly enough, the same weird
theory is popular among farmers,
who

often

say that if they get
prices for their crops they
much machinery, lum¬
ber, clothing, and what not, there¬
by making the urban workers
prosperous and happy.
For all of
that, the more intelligent farmers

high
will

buy

scoff at the argument that higher
urban

prosperous.

will
make
them
The chief effect, as

they

will

wages

see

it,

increase

the

cost and prices of manufac¬
tures, already too high, and thus

reduce the farmers'
and

that

buying

millions

collar workers

power

of; white-

well.

They

say,

in effect: "Let the urban workers

fam¬

increased by 79%, from $26.64 in

yearly income

January,. 1941, to $47.12 in April,
1945, and chiefly because of over-i

slightly higher wages, work longer
hours, as we do, cooperate with

of $1,641
in Atlanta, $1,598 in
Detroit,
$1,816
in
New
York,

$1,807 in San Francisco, and $1,809
in Washington, D. C.
The report
adds that, because of the later in¬
crease
in the cost of living, the
figures should be raised by 5%
to make them
applicable to Oc¬
tober, 1945.
Another investigation based on
the spending habits of economic
groups in San Francisco has been

manufacturing

time

pay, are about to f be put
back to the 40-hour week which

to create the largest possible
output of goods and services, and
they will presently find that prices

at 1945 wage

will fall, markets will

their

of living yvill go
incomes will rise, and
will be happy."
■

rates, would reduce
weekly take-home
pay to $36.29—a beggarly wage
as compared with the income o*
$59.13
found
necessary
by th^
average

Heller Committee for
four

living

"health and decency."

family of

standard

True, workers receiving $30.29

''■/: *

they

be satisfied with their present or

our

have epjoyed, the partial elimina¬
tion of overtime, and the rising

industries,

Such

smaller by claiming

UNDERWRITERS AND DISTRIBUTORS OF

BROKERS OF BONDS,

wage rates look rather small, but
Miv Murray makes it, look still

whose average weekly wages had

by
at

larger cities
family living

"maintenance level."

BANKERS

in¬

45%.- This figure makes the de¬
mand for a mere 30% increase in;

der

with the

compared

about 33% in ; the cost
estimated by the Bureau

of Labor Statistics.

cluded

increase of
of January,

pay

$59.13.

Among the efforts to define fair

celebrated encyclical, REN'OVARUM, of May 15, 1891,

But,Mr. Mur¬
erally accepted standard of "health ray sharply criticizes the Bureau
and decency" as of March, 1945,
for grossly!; underestimating
the
a
yearly income of $3,075.72, or rise in the cost of living which,
an
average
weekly income of he says, has increased by at least

that an
American family should not have
all of these things—and more, if
possible?

along these lines may be
mentioned that of Pope Leo XIII

-vvi^r. nttrJawAavr* «»'»w

J^r-v

thing should and couldbe done
by way of raising standards of
living
and
thereby
wages
to
higher and higher levels. wages

ceptions The results of such vol¬
untary agreements were consid¬

Committee

which seemed to hold that what¬

ex¬

"#*•* W£S«"it tiff* C."

«f

made by the Heller Committee of
the University of California.
The

India.

especially true in the
where labor was rela¬

colonies,
tively scarce and wages were
high. Governor Winthrop of Mas¬
sachusetts tells in his journal of
a
master who, in the year 1645,
was forced to sell a pair of oxen
to pay a servant's wages. "He told
the man he could keep him no
longer, not knowing how to pay

living

workers would

therefore, being determined by
supply and demand, but chiefly by
supply, were thought to be nec¬
essary and fair, even, though fair
wages in England might be twice
as high
as fair wages in Ireland
and 10 times as high as those in

g es

•

ily at the customary standard of
living.
Actual
contract
wages,

pute, after

their way clear to support a fam¬

does not tell us
were
and are,
though the Prophet Malachi
fiercely
denounces
those
who
"oppress
the
hireling \ in
his
wages," and.;, the Apostle Paul,
writing to the Colossians, said:
him next year.
The servant an¬
"Masters,, give unto your servants
swered he would serve him for
what is just and equal." >.>
more of his cattle.
'But how shall
•1 But the .scholastic
philosophers
1 do,' saith the master, 'when all
of the Middle Ages, including the
Angelic
Doctor,
Saint
Thomas my cattle are gone?' The servant
Aquinas, did give much attention replied, 'You shall then serve me
and have your cattle again.'"
to the question of just prices and,
incidentally, to the related ques¬ •v The determination of wages by
tion of just wages, following, ap¬ contract had, of course, existed for
parently, the opinion of Henry of ages side by side with custom or
Langenstein; who ; said that "a status and, as the wage-earners
few' discrete elders should com¬ gained in independence, came to
what

and multiply unless they could see

builder

F»r

the

the clothiers were compelled to
equality of ratio between two pay higher wages.
persons and two things.
If the
Wages Determined by Contract
persons are equal they will have
This and similar episodes, like
equal shares, but if they are un¬
straws that show how the wind
equal the shares will be unequal.
make it clear that the
For example, Aristotle says: ; "As blows,
workers were no longer satisfied
a builder is to a cobbler so must
with
customary
pay
and
that
as
many shoes
be to a house."
were
being
determined
This is not very illuminating, as wages
more and more by free contract.
we
are not told how much more
a

•

standard of

pe¬

tition the Privy Council appointed
0
commission to investigate and

worthy

•

to this

VJtf*

!.Vt '? *'

Ji jti Jl

•.

"ost

expand, the
down, real
everybody

present,

moreover,
there
shortage of buying
nower, witness the swelling sales
seems,

to be

of retail stores, the active demand
for

producers'

goods

every

•V.7

.Volume 163

THE COMMERCIAL & FINANCIAL CHRONICLE

Number 4434

'• / v

'■

fy v
to payrolls

2239

iv«

and public
If Mr. Murray had
of about 1 to 3. Mr. determination of fair profits and related to private
kind, and the frantic' efforts of irrelevant.
Welfare, That prices of things, for
the Government to keep prices compared the profits after taxes Reuther, it appears, based. his ex¬ fair prices,
down for fear of runaway infla¬ of 1944 with those of 1938, which traordinary statement on profits
example, cannot.be divorced from
The Equilibrium Theory
tion. It looks, therefore, as though were abnormally low, he would before taxes, and left salaries out
Jiuman toil and needs is finely
From this it surely follows that shown in Lady Nairn's touching
the case for higher wages had not have been still more shocked to of the calculation, although onebeen strengthened by the demand find that they, had increased by fourth of the corporation's em¬ if the business machine is to oper¬ song, "Caller Herrin," which the
ate smoothly and, effectively, so fishwife sings:
more
than 500%.
for more buying power
Or, to make ployees are white-collar people.
Mr.

third 'argument,

Murray's

which he presents first, is an ef¬
fort to prove that the manufac¬

turing industries

whole

are

able to pay an / increase in
basic wage rates of 30% because
of their wartime profits and their
well

cites

array

governmental

figures

from

including

sources,

the following:
Total profits

being

culable,

in-

than

greater

formed

000, and in the year 1944 they
were
$15,000,000,000, having in¬
creased from 1939 by no less than
370%.

744,870, showing a ratio of profits

Even after taxes the

cor¬

porations had net profits for these
four years of $22,000,000,000, and
$5,800,000,00 in the year 1944—an
increase of 123% over the profits
of;. 1939.

The

following

table
gives a comparison of prewar and
wartime profits.
•
Manufacturing Corporation Profits
After Taxes (1936 to 1945)
..

(In. Billions of Dollars)

<•

?-T

I-.-/- //

A few facts culled from corpo and Governmental reports

may serve to correct exaggerated
notions as to the size of the prof¬
its, of

successful

concerns, not to
mention the losses of the unsuc¬

cessful,

The

following

figures

914,341,158
'/

Steel—42,500,000
General Electric———..—
50,800,000
American TeL & Tel. Co.— 163,165,614

12,303,807
Nation! Dairy Products Go.
13,318,000
American Rollings Mills Co.:; 5,067,991
Fairmont Creamery—
«;»
1,070,280
West Va. Pulp& Paper Co.

847,000,000

464,000,000

1,073,928,000

975,132,439
889,500,000
514,800,000

1,237,093,614
173,663,408
107,956,000

161,359,601

(to Oct., 1945)

Swift & Co.

94,648,000

64,786,517
/

Owners

ployees
88

7/;

://'''//S ■'./

•

'•

14/;/

V/'

•

92 ;

69,854,508
•

8,502,633

15,439,766

2,142,672

■//Bll/;/

9,572,913
17,685,838

;

[fhrevvaf

That
these
figures represent imposing on the employers greater
fairly well the normal ratios of burdens than they can bear, and
1937..-L.^i 2.5
1941—— 5.3 profits to payrolls may be seen in by the principle of compromise
splitting
the
1938i.0.9
1942.2^
4.9 the Survey of Current Business commonly : called
of January, 1946, which gives the difference.
Which calls to mind
1939^._—. 2.6 • 1943-^ijii^ 5.6
a story told by the late Sir Robert
distributive
shares
of
corporate
Prewar avg. 2.1
1944——«« 5.8
production for the year 1944 and Stout, Chief Justice of New Zea¬
estimates the profits after taxes land, about a man who left the
Mr. Murray cites also a recent
at 9% and the compensation of Arbitration Court irihigh dudgeon,
analysis by the staff of the Office
employees at 61%, making a total muttering with maledictions: "Call
of War. Mobilization and Recon¬
of 70% of total production as the that
arbitration—they
gave; it
struction, from which the authors
combined share of owners and against me."/
;.'
inferred that three "measurable"
For
all
employees, of which the owners
that, a step toward the
factors would permit of an in¬
had 13% and the employees 87%. discovery of justide in distribu¬
crease in wages of 24% for
|he Moreover, the owners received tion is taken when it is realized
year V 1946
without
increasing
only a part of that 13% in divi¬ and admitted that the prime ob¬
prices or reducing profit margins.
dends, the rest being left as sur¬ jective of economic effort should
These factors and the correspond¬
plus earnings for security - arid be the greatest possible output of
ing increases in wages were as
future development.
goods and services ~ balanced
follows:
reduction of overtime,
abundance—and that the sharing
FrOm these figures it looks as
4.5%; elimination of wartime up¬
of the product, important though
grading and similar wage in¬ though even relatively successful
concerns, such as General Motors it be, is of secondary moment.
creases, 9.5 %; repeal of excess
and General Electric,' could not
Another step in the same direc¬
profits tax, 10%,
afford to make any substantial in¬
The report, however, according
tion is taken when it is seen that
crease in wages without compen¬
to Mr. Murray, was far too con¬
sating increase - in : prices unless in any dispute about wages at
servative.
After examining the
the
optimistic
guesses
of
the least three parties are concerned:
several items and forecasting a

Years

2.5

1936

3.5

1940

•

"spectacular increase in produc¬
tivity" in 1946, he arrived at the
conclusion that the manufacturing
industries could pay a total wage
increase of 38% "without price in¬
creases

&nd

taxes at

twice'the

with; profits
prewar

level."

should

can

that, and for the fol¬

Predictions of Future
:

Earnings

First, the corporations

rived

the "conclusion

ar¬

that

General Motors should produce at

only 80% of capacity during. the
year 1946, it would have net prof¬
its

after

taxes

less

than

$327,000,000, which would be "20%
greater than the highest net in¬
come

in its history."

Mr. Reuther

also said that in the year 1941 the

earned for its stockhold¬
$1.09 for every $1.07 paid to

company
ers

/the wage-earners, and that, there¬
fore, "the rate of labor exploita¬
tion^ in that year was about 100%.
Ability to Pay;Higher WagesAs to the

ability of

our manu¬

facturing industries to pa.y much
higher wages, the case of the CIO
looks strong on the face of it, be¬
cause of the magnitude of the fig¬
ures cited, but when those figures
are examined
and deflated they
so formidable.
True,
profits of all the manu¬
facturing corporations from 1941

"do not look

the gross

to 1944 amounted to the

enormous

* sum

of
$51,900,000,000,
before
taxes,1 but .in the single year 1944

their net profits after taxes were

only $5,800,000,000, showing that
the gross figure has no signifi¬
cance

For

in this

the

connection.

same

reason

the

fact

that profits before taxes increased

by 370% from'1939 to 1944 is quite

termined without

neither

Actual

Wages, of course," rate
exactly at the imaginary
point of. equilibrium, but either
above or below it,-so there is al¬
ways room for bargaining.
If, as
where there is no monopoly; and is often the case, the employer,
a i buyers'
market, hasthe
such price, as most unbiased buy¬ in
greater bargaining power, he may
ers and sellers will admit, is not
keep wages down below the point
far from fair.
of equilibrium, and thus injure his
By the same token, equilibrium
profits, are such as will induce in¬ employees by • paying them less
vestors to supply as much venture than they are worth and injure
himself
by failing to get the
capital as business enterprisers
needed competent workers. If, oh
are willing to use. At the equilib¬
other hand, the employees
rium point the market tends to the
clear itself, leaving neither idle have the advantage, by virtue of
capital awaiting sufficient incen¬ being- strongly unionized, - they
tive to invest nor business enter¬ may, force wages above the point
of equilibrium, sacrifice the highprisers unable to obtain the funds
cost of marginal employers; and
they need for starting new enter¬
ing to sell for the price but un¬
able to find buyers."
In other
words, equilibrium price is a price
determined by competition among
many buyers
and many sellers,

never

prises

throw

more or

fewer of their fel¬

expanding those already
low workers into the limbo of the
begun. The supply price of ven¬
ture capital, of course, varies with unemployed. /And yet
thf latA
the estimated risk, but who shall Samuel Gompers did not shrink
from those consequences when he
say
that competitive profits,
whether in farming, manufactur¬ advised: "Whenever you have to
ing, merchandising, mining, or accept defeat in your, negotiations
with your employers, accept it in
what not, are not as fair as can
the form of unemployment, not in
be in our present economic order?
the form of reduced wage rates."
If, then, we may find fair prices
or

and

profits at their respective
points of equilibrium, why may
We not look for fair wages at or
near a similar point of equilibrium
or balance, where employers and
employees come together /in
free market?
One may hesitate to
..

librium

prices of the product,
recent
;

mechanical equation for de¬

use a

termining

the

value

be sure, these bad effects
be avoided and a new equi¬
established ' by
raising

may

human

settlement

as in the
the
steel

strike and the qualified promise
of / other upward
price adjust¬
ments; but that is a sort of con¬
spiracy of labor and capital," with
the

connivance

the

none

the

gain

will

simultaneous

.another and.

■

all^ ;^e^intlinatMy

(Continued on page 2240)

This advertisement appears as a matter of record only..

partially offset by loss due to
plant idleness. Third, there may

.This is under
'

>
'

not be much

ployees,
occur

even

■

elimination of

circumstances to "be

construed

(is an

offering of these Securities for sale, or as an

'a solicitation ot(in offer, to-, buy, any of such Securities.
offer is made only by means of the prospectus.

offer to "buy, or as
"

The

•

should

the saving would be slight

unless wage rates were
the

down-grading of em¬

but

NEW ISSUE

cut. Fourth,

$11,500,000

profits
will save something if ex¬
profits are earned, but before
long competition is likely to elim¬
inate them. Fifth, the spectacular
increase in productivity envisioned
excess

taxes
cess

Graham-Paige Motors Corporation ;l

by Mr. Murray may not material¬
ize.

Sixth, the claim that ability

to pay

higher wages is measured

by profits, before taxes is a de¬
mand that' wages
the

Dated

Seventh,

wage rates
the ability to pay of the

based

most

prosperous

concerns

might

■

be ruinous to the less prosperous
Unless protected by higher prices.
1

When

all's

said

% Convertible Debentures

7>-'

be'increased; at

of Government and

expense

taxpayers.

and

•■•••■'

April 1, 1946
';

■.'v*

" f

•

*'*■' Y;

f
:V-N..Vv'/;/'

•

Due April 1,1956

c
''-.xLA

;iv"

(■

'i-;

^rice 100% and accrued interest

done, the
fair, just,

question as to what are
reasonable, or right wages seems
as elusive as eyer.
JSven in Aus¬
tralia and New Zealand, where
they have compulsory arbitration,
no definite legal principles have
been established beyond the doc¬
trine of the minimum wage. Apart
from that the wage boards, coun¬
cils of conciliation, and arbitration
courts seem to be guided chiefly
by their wish to make a workable
decision by' giving as much as
possible to the workers' without
.

-■

Copies of the Prospectus may be obtained from the undersigned

oiily in such State's where the

undersigned may legally offer these securities in compliance with the securities latvs, thereof.

Mllen
New

Govern¬

service;1 but all of these factors ment, against the general public,
cannot be de¬ and fbrces act and react upon one by making millions of consumers
consumers,

1946

little

public,

leaving

that they

Walter P. Reuther, President-elect

Workers, CIO, who,
the basis of numerous figures,

employer, the employee, and

the general

bought,

equilibrium wage at which the
itself, leaving neither
employers willing to pay that
wage unable to find employees,
nor employees
willing to accept
it unable to find employers. - y**-'-

Will;<n6t

have the assured market in

of the International Union of Au¬

tomobile

the

and that fair wages

lowing reasons:

enjoyed during the war.
Second, there may or may not be
much overtime^ and if there be

has been vigorously supported by

■

CIO

I But; there

assurance

after

In these contentions Mr. Murray

the

and

OWMR

realized.

modity, nor would-be sellers ^wilt¬

Em¬

& Payrolls
Payrolls '
•
$1,380,030,467 $1,551,026,332

Bethlehem

market clear

any

price but unable to; get the com¬

Percentage Going to

Sum of

price the market clears itself: ex¬
actly as much is offered for sale
would-be buyers ready to pay the

•

Inasmuch, then, as there is in
given occupation at a given
place and time a labor market in
which wages are determined. by
supply and demand, there must be

„

spairin',

equilibrium price," as T. N.
Carver has well said, "is a price
which which will induce produc¬
ers to supply as much of a com¬
modity in question as buyers are
willing to buy. At the equilibrium

the

;/••

Ca' them lives o' men,"

"An

an¬

SteeL—60,791,281

re¬

nual

*0 MANUFACTURING CORPORATIONS,. 1944

Net Income

Corporation-

their incentive and

have been taken from several

reports accessible
present writer.

may

are

ward.

Net Income

which

in wage rates
loss of $150,-

increase
result

ration

wages

NET INCOME. AND PAYROLLS- OP

have maximum pro-" "Wha'll buy my caller herrin'?
if not full,
They're no brought here without
employment of our resources, ma¬
;
brave darin';
terial and human, there must be
Buy my caller herrin/ hauled
balance or equilibrium among the
thro' 'wind and rain.
parties participating in production O ye may .ca' them vulgar fairin';
and the shares going
to them,
.Wives and mithers maist de-

profits

000,000.

have said that the ratio of profits

in the General Motors
Corp. is unusually high, "fluctu¬
ating around 100%," as in the-year
1941.
However, according to the
annual report of that corporation
for 1944, the net income in the
year
1941 was $201,652,503 and
the payrolls amounted to $669,-

30 %

would

one so well in¬
Mr.
Reuther should

probable

ductivity and high,

of General
Motors in the year 1946, H. W.
Anderson, Vice-President, in
"General
Motors ; Reply,"
goes
over
the figures point by point
and concludes that the payment of

that

Strange

before taxes of our
manufacturing corporations from
1941 to 1944, inclusive, amounted
in round numbers to $51,900,000,-

the

percentage^ of increase was incal¬

prospects for postwar prosperity.
In support of his contention he

that

As to Mr. Reuther's forecast of

such comparisons still more ab¬
surd, if he had compared the
profits of 1944 with those of 1932,
when there was a deficit, he would
have been appalled to see that the

Company

York, April 22, 1946

•

V.i

♦

«■

2240

THE

What Are Fair Wages?
(Continued from

2239)
remain, low pay
the increase • in wages of those
whose incomes are already fairly
high. In this connection, 0r.L Ed¬
win G. Nourse of the Brookings

whose

has

"The

said;

well

officials, by exploiting "war
pressures; to push wage rates up
whenever and as far as they can
and by insisting on maintaining

emergency rates when we are try*
ing to get back On a peace basis,

maladjustments that
prevent effective operation at va¬
rious points in the system
andmay throw the whole into con¬
create

may

fusion."

(Continued from page 2214)

However, it must not be thought
the balance or equilibrium

inflationary emissions of

from

cessity.

expanding

markets,
in*
creased demand for labor,
and
new and higher points of
equilib¬
rium all along the line.
Higher
money
wages
might not come
from this, but higher real wages
surely.would. To quote Dr. Nourse
again; "Prosperity is spelled by
more goods lor the same
money,
not more money for the
same
goods." ;
.v..;.:
./ f.;

Gov¬

in such

money

meets his desire

ne¬

But despite this "abridge¬

of the normal

ment

American

rights of the
people * it
proposes

* new
emissions
as
grants-in-aid to foreign states with
enormous

xhe

avowed

enabling

foreignpeoples to enter

our mar¬

kets

purpose

home

abroad.

with

.producers

critical

condition

Government

justifies

price

deem

that

stand
,

its
so¬

regulations

by operation of which a great seg¬
ment of the population is denied
butter for

its

table, and items of
clothing essential to comfort'and

convenience;" Yet it continues to

fiscal 'follies

most

extraordinary and inexcusable
ture. As

example of this it has

na¬
re¬

cently been stated by a responsi¬
ble official that the Government's
bill for food

business

,or

government " is - headed ;fOr> the
rocks the proper course of action
is to turn about and head for safer
waters.
Can this be doubted? *
> So I suggest that, as an alterna¬

subsidies is funning

at the current rate of

$2,600,000,-

admirable

Prof.

paper,

Kaplaq wittily and
WI fear that

became
soon

once

the labor leader

economist
to

David

wisely. said:
he

would

a labor leader."
If this be true and remain
true,
the question of fair wages as

cease

part

of the broader question of
justice
in distribution will be

decided,
by academic discussion nor

not

amiable collective

by the!

bargaining, but

of pressure groups

power

engaged in fierce and, possibly,
violent conflict.
In that case the
tabor

fit

unions, finding themselves
minority, may be glad to

the.

appeal again to
tice

some

ideal of

jus¬

protect them from the
tyranny of a majority arrayed
against them.
;
<" *;
'

■

Feldman Named to Post
In NY State
Banking

The .New York State
Department announced

Dept.

5 the

April

appointment as Special Dep¬
uty Superintendent of Banks of
Edward Feldman, of New York.
He

was

March

appointed to the post on
30, 1946 to assist in the

liquidation

and

distribution of the

ing for Grants
It

property

New

York of any and all
foreign bank¬

ing

corporations

(including

New York agencies

thereof),

the
pos¬

session of which has been hereto¬
fore taken by the
of

Banks

York

^aw«

Superintendent

the

pursuant

State

the

foundation. ; And: in
other, manner can;we save the
great middle classes of the earth
from, financial ruin and disaster.

upon assure

them has

exhibited

observable inclination to turn

cannot

imports

currently

that

they

issued currency and credits which

ever

its are to be manufactured" with¬
out

limit; if

to!

continue ' the

Then

iri high office are
making, * of - ex*
be met by infla¬

men

British cfoctd^
inflation and add it to

there

will

need

from

failure,

since
of

where

the

law

ing itould'^'be
them

those, who,
offer to

not

in the

buy,for

dollars

fects

tives.

-•••

•-

■

Value

own

downfall in

effort

theirs.

Time has

continue
the

her

basis

sug¬

meet

these

in business for
American taxpayer
the usages of trade
leave the loss occasioned
engaged

Would

by " British default ron the seller.
And should the American taxpay¬
assume
the payment of the

never been

bill, thus permitting the. foreign

Britain

blocked

commercial

damage.

This

argument
has
force
only
upon the supposition that the Em¬
pire and others would be both
able

and

willing

indefinitely
sell things of value

produce and
to Great Britain for
tion

blocked

currency

considera¬

tangible
and

than

credit,

;«

;

long ago , that the debtors*

prisons

of England were filled
with unhappy human beings, and
the sorrows of the bankrupt mer^

;
t

;

chants of that country are feeling-

dition admits of no solution which
does not mean hardship for some
The question is not ohe of

one..

avoiding,hardship but rather that
of| determining upon whom the

:m]

The country is filled
J
with persons struggling to meet
•
.the present advancing cost of liv-'..
ing, who ' anticipate future in-1; ^
creases with deep anxiety.
Their
*
savings have been reduced; their \
incomes shrunken; the Value of
own

people.

their annuities and life insurance
tax

burdens alone

Creased.'

collar

All

have

salaried

workers

face

been in-

and

the

;

These

are

the .hapless

monetary inflation.

|| *
.

white

future

with apprehension.
It is .an apprehension that isTwell fbunded.
our

•

"f' /

policies sharply depreciated. Their

•.
,

victims of

I am not 7

unaware of nor

the

some

education of children or
other cherished project, now

find their hopes impossible of *ealization.
The middle .classes bf
the United States qnd of a}l coun¬

tries abound' in

such'persons who
being crushed' arid pauperised
by the rapidly advancing infla- /
creditor to emerge from the trans¬
tions
deliberately planned
and
action With full payment of his
carried out by their own rulers.
/
bill including profit,, why should,
he not continue to sell to Great •n
er

purchases

Is there fairness in the

profit, and
or
citizen,

In opening the argument on be¬
half of these grants their Ameri¬

abroad

when
thev lots of the .defaulting debtor
and of his injured or ruined credifor- have not been hard. It: was
v

/'T'.
,

■i
>

international

other alterna¬

are no

and

disregard

which tend

Therefore,

recklessly
those sound

force

both

and

are

others

ten our

exist; and

...

repudi¬

irreparable

this

unsympathetic topeoples of foreign states,/.
>
cured by adding the total amount
the
victims
of
like practices on
to our already seriously inflated
7 /
the part of their own govern-*
,'7
"
circulating medium; and later be
compelled to meet similar obliga¬ merits, T merely7 feel that T?otih'
; 'V : tions of bthbt foreign states? I for justice and sound reason demand
that the peoples of each country
*
one do not think so nor do I think,
work
out
their
own
financial
as I have pointed
out, that such
These problems have
action would
bring: more than problems.
;.
■
temporary relief,.to .the embar¬ arisen almost universally from
policies carried out by. national
'^
rassed governments. •
leaders. In no other way can the
i ;The commercial usage of man¬
people of the world be brought
b
kind, • reflecting: the wisdoni and
ioj a realization of the meed: pf se<*|7;
experience of ages, is to permit
lecting wise and competent rulers,
}
losses occasioned by the default of
and of insisting upon wise and
debtors to fall upon their credi¬
moderate conduct by . those in
7
tors.;; .This is a; sound and just
power./ As hard as is the lot of
;
rule. | As ' between : the creditor,
the defaulting debtor or of the
Who dealt with the debtor as a
creditor ruined by his. default,
; 7 :
means of gaining a profit, and a
still harder is that of persons who,
* |||
bystander it is just that the cred¬
after a life of sobriety and indus- 7
V;A>
itor should stand the loss. /But
try> and the practice of daily selfeven more important is the fact
denial endured in the hope of an
J
that knowledge that the loss if
independent/old age,; find/their 1
any must fall upon him prompts
savings reduced to little or naught :;/
caution and prudence upon the
by willful act of their own gov- / /
part of a country. As between the
ernment;; or those who, having
*
foreign seller of supplies to. Great
saved for the building of homes 7/
Britain,

markets,
than a thing

full, set¬

governments to
follow sound and Drudent courses?

But

that

ward the

such claim.
-

There

Government

own

Great Britain through these prac¬
tices, unless the British grant is
To their credit the British
-

debt of Great Brit*

obligations to the extent of $4,*
000,000,000; this sum to be4 : Se¬

made.

as a

it must

gestion that Americans be com¬
pelled by legislative act of their

is-required to reveal the hollowof the argument that our for¬
eign trade will be taken over by

openly accepted

ated.

ness

make

-cannot

be treated

trade should. Great

American

ain and either be paid in
tled by compromise, or

But, you say, what of the cur-*
rent obligations of these countries
and what of the impact upon our

rCsort

•

be ; secured - this
Sterling must either be
released and the inflationary ef¬

cept &ud pay for j all thai exists
and alb that can be produced, »:

foreign

1 secure

blocked

is worth must be prepared to ac¬

own

dollars in exchange. : If American

open

than

more ; agreeable

individuals

rectitude.

said

burden shall rest.-; It is folly to
pretend that we can shoulder these
debts
of foreign states, and relieve
plies- and materials. - In payment
they have accepted an unspend- them; of substantial "portions of
able riaedium:, Naturally they de-: their inflations by adding them to
sire spendable money and noth¬ our own, with no hardship to our

beginning to
beybnd the
create

value does

own.

purchases of the Empire and many
other countries, to our
great and

and

♦

■'£
<

Great ; Britain are fin ; effect' its
creditors. - They have sold it sup¬

lopger lor disguised market sup¬
porting operations in foreign cur¬
rencies which, despite their eu¬
phonious and alluring titles and
complicated
apparatus^ * are
doomed

our

'.The,holders of blocked Sterling
though not. legally creditors of

circulating me¬
perhaps 9 precipitate a

dium ?and

national crisis.. The purpose of the
American grant is to lift from the

does not follow that we
arp under
moral or ethical obligation to has¬

will

ly portrayed in the great novels
of that tough period. JBut the con*;

floated in

increasing amounts; ff bank cred¬

jrules

prudence

*; !■:

harsh arid unfeeling attitude. That
the.situation is hard I do not dis-

currency is to be

unsound

force to herself the near exclusive

cize them for their lack of fiscal

nancial ills.;. There is no other so¬

pute,

The1 meaning of. the blocked
Sterling is this: Great Britain has

lution.

seek

away from such

New to
temporarily moderate the speed
Banking ( with which they are approaching

and

are

inflationary

tion of the world's fiscal and fi¬

Sterling and would thus in effect

practices.
True,
in poor position to criti¬

further

This is the road along

not so

can proponents suggested that un¬
less made Great Britain would be

Government

it cannot permit
fo be honored in
practices. are to be its own markets since it
would
pursued on the part of govern-' disclose to the world
and to the
mpnts; if deficit financing is to be British people " the
great* inflation
continued; if irredeemable-paper that exists in its
If

forced

none

from

own

determination to de¬

exportable

thq grant iri-essence involves.

said

sist.

our

which all nations must proceed ir»
any real and epduring rehabilita¬

value from us.. For that is what

brought these difficulties to a cli¬
they were
observable "in
every state before the war began.
Without a single exception these
governments were engaged in un¬
sound
fiscal practices which if
persisted in must have brought
them to ruin.
In short they were
spending more than their reve¬
nues and making good the deficits
by some form of currency or cred¬
be

sufficient

would have

currently

can

production and international trade

support only in
that the British

tranquility, of peoples and place

-•

J But slight consideration

also

find

$4,000,000,000 worth of things of

secure

ences;

can

emissions.

could

the

governments;

barter?

inflation.It

ment

sential

other can we insure the stabil¬

ity

financial difficulties do not
have'their origin An the! late war.
the war aggravated
and

announce its

a'frame of mind as to make their
fiscal rehabilitation possible.

While

known

this grant the British Will resort
to; barter and thus drive us from
the world's markets.
This argu¬

humanely

pro¬

Britain continue its blocked Ster¬

well

possible that they will not be re¬
sumed.' And as fan example, I

duce exportable items in suffi¬
cient volume to exchange for es¬

ling practices; its Empire prefer¬

Such guaranties as are

ing a return to fiscal honesty and
sobriety.
In this manner and in

their

states

of
and

clear that they are not yet in such

that

the

inflationary: practices

hand

power

and

Apply¬

impossible for me to at¬
tempt an analysis, of the fiscal af¬
fairs of the many foreign states
now upon the agenda for grantsin-aid. A large staff would be re¬
quired to assemble and examine
statistical data and supplementary
information
respecting " present
and
possible V future 7 political
trends.
But in respect to each of

all

business

con¬

of '

The Situation in the States

that

and the

hoped * Jor
gain
through foreign trade can justify
jts practice.
1
, .
1 ,

business and
property of any and

banking organizations

which follows it.

max

Banking
on

ment

sideration

how in financial" distress" in" secur¬

000 per annum., These'vast emis¬
sions of inflationary currency and

it, and will} bring economic/ and
political disaster - to any Govern¬

obligations;

discontinuance

If, the
applicants for
grants-in-aid
are 4 unwilling
to
meet such conditions the proof is

an imperium
But in discussing this

things of value to barter and. ex¬
change
for : necessary 7 imports.
truth: is quite the contrary*
It is because they do not have on

imperio,

their

The

their

second suggestion- even less per¬
suasive is that unless sustained by

produce

penditures to
tionary emissions which by indi¬
credit "are justified by the pre¬
rection: take from the people that
tense that they tend to prevent
which th ey'.ldare not take by ~dti;
inflation. ' Human pretense could
rection,; it is useless to hope for
scarcely
have
less / foundation. wbrld rehabilitation. And
whether
These omissions do not prevent
.»
siich destructive policies are the
They
are
-inflation. result
Such considerations, though eco¬ inflation.
of. ignoraftce, venality oi
Their design is not to prevent in¬
nomically and ethically sound,' do
inattention Upon the part of law¬
not appear strongly to our bel* flation but to prevent the people
makers,'and by whatever motive
ligterent labor; leaders, who are from becoming aware, .through
thjey may be: prompted,, or by
more interested in
getting as much startling price increases, of the true whatever person or persons urged,
condition of the Government's fis¬
as
they can for their followers
the;.result will be the: same.} If
here and now rather than in any- cal affairs. By these subsidies the one
group" demands and. secures
Treasury
is
currently,
adding
new
academic discussion
of v general
inflationary issues in support of
welfare or labor's long-time "in¬ inflation in the hope of temporar¬ favored
measureS, 7 however
terests. At a meeting of the Amer¬ ily concealing that of the past. wprthy they ; may deem them,' it
ican Economic Association "in Jan¬ 1 cite this as one flagrant exam¬ should
occasion
no ' surprise
if
uary, 1946, Prof. C. R. Daugherty ple of our inflationary practices. others .demand and secure even
offered them excellent advice by It is but one/of many. \vOthers
greater issues in support of meas¬
inexcusable
are
in
way of suggesting moderation in even ; more
ures which* excife their particular
' - •
\
demands for increasing pay, peace¬ prospect.
interest*;I/ Only when the govern¬
I further pointed, out: to him
ful cooperation with employers
ments of the principal nations- of
for enlarged; production at. de¬ that inflation' or the circulating the world return to the
practice.
creasing cost, concern for the wel¬ medium of a country through the ofThat common honesty which is
of irredeemable
paper
fare of potential members, plan¬ issuance
required of the individual and en¬
ning in terms of the common good, currency and even more intangi¬ forced by the courts will interna¬
ble bank credit is the certain road
a
long-range point of view, and
tional commerce revive and stand
a
broad statesmanship commen¬ to ruin, though the people them¬
permanently upon a stable basis.
surate with their power, which selves do hot always understand
has almost created

followed

wholly untenable supposition., A

the supposition
have on hand

tive : to
a
policy of American
grants-in-aid, disguised or undis¬
guised, which,- while hastening
our own ruin; can; no more than
temporarily delay the inevitable
ruin of others, we make common
cause with the states of the
world

affairs to

practice

ship or

such

the

berly

compete

and

That in

and

merchants

our

fiscal

.prices,

spending his

manner as

does

and balanced abundance of goods
and services
also
brings lower

currency

prices rise alarmingly, the

fixed

something
and that,
therefore/ there is no .hope of
higher
real
wages
and
rising
standards of living except by the
power of monopolistic minorities
bargaining for themselves alone.On the contrary,
anything that
makes for increased productivity

The Alternative

ernment contrives laws and regu¬
lations to prevent the individual

of the labor market Is

changeless,

"Purchasing Power" Fallacy

and credit, and, as a consequence,

that

and

page

union

Thursday, April 25, 1946
mise

incomes

Institution

COMMERCIAL & FINANCIAL CHRONICLE

preliminary to

determination of what aid

if any

My letter to Congressman An¬
derson

was
in
effect
a
brief
against
proposed
grants-in-aid
disguised as loans to foreign states

then reported to be contemplated
in

/
r

aggregate sum of $20,000,000,000. I was not unaware at the
ap

be. extended to foreign states time of its preparation that in rein financial difficulty I sug¬
spect to some of the countries po¬
gest a complete and businesslike litical as well as economic considexamination of their affairs by
erations were involved.
Some of
competent and experienced men;
these considerations adverse to
where
may

now

necessary a
a of their affairs and

;
■"

.reorganization
a

just

compro¬

our

own

interests

were

discussed.

Volume 163"

Number 4484

THE COMMERCIAL &

But since the proponents of the
grants" had predicated their case
solely upon''the claim that they
were,

commercially advantageous

State Department in

our

The Russian threat to the

British

Empire,

unconditional

inherent

in .the

surrender

/policy,
and apparent in its
terms, is now
openly * acknowledged and uni¬
versally understood./ Without

our

help Great Britain, is incapable of
^ sustaining
her
Empire
against
Russian
pressure.,; That
Russia
proposes to exercise her power to
the utmost, in doing which she is
no more than
following the prac-

*. tice of- empires in seizing oppor¬
tunities made ready/for them, is
now clear./ We must
mine our, own course.

three

centuries

■

was

the

cardinal

principle of British for¬
eign policy that she must' always
act' to prevent the establishment
of

one

'Continental/Europe

dominant

military

power
upon

the* Continent of Asia. She fought
many wars in

the,implementation

this policy. < These were wars
of coalitions and it was through

her;

success in

powerful

c o a

the organization of
I i tip n s that she

brought, them to successful
elusions
served

her

and/thus

not

con-,

pnly/pre¬
area of

but.enlarged.the

domain.

From

this

correct

position v she /receded / when she
yielded to the American demand

for, the total political annihilation
German

the

State

and

her

European allies, as well as that of
the Japanese Empire.
The anni¬
hilation of these, states left Russia
the- military master of Europe and
Asia.
Because of their annihila¬
tion British organization of resist¬

ing coalitions

longer

was no

pos¬

"Great Britain now stands
faced In both Europe and Asia by
a dominant land power vastly su¬
sible.

perior to her in manpower, in nat¬
ural resources, ;and war potential,
and with interests sharply con¬
flicting with her own. This is now
a fact accomplished
and from it
there is

without

recession.//It was not

reason

that Mr. Churchill

recently, embraced the opportun¬
ity to address the American peo¬
ple.
Tdo not profess to. possess the
or
- military
knowledge
requisite to a determination % of
factual

correct

policy respecting aid
to the British Empire as a possible
ally.
I entertain no doubt that
our

the* Government knows much that

anxiety to

in its

world

preserve

it has withheld from the
public../But if it is the considered
judgment of our Government that
this grant should be made to
peace

Britain to preserve her as
aid to our own defense, and in

yan

and I like to

It is

stroyed

wealth

Europe

repre¬

the

sented

crystalized labor of
generations, of men performed

(Continued from
ume

within

year or so, as

It had

done after the panics of 1907 and
1920-21.
As several years passed
with

little, if any, improvement,
I commenced to wonder what was

may pass

before free

lations

profitable trade

restored with the por¬

are

re¬

tion of Eastern Europe now under
Russian rule.
The peoples of the

questions,

fallen Countries; will be forced to
the greatest economies

tion

well

they

capable in the restora¬
of habitations and provision
are

tion

of; food:

and

they

have

before

them /the/task of accumulating
capital for industrial rehabilita¬
tion./ It is a delusion to suppose
that

large and profitable trade is

to be found in this quarter. Those

omy.

wealth

own

established

represented

trade

prospect of trade to

and

•

come.

the

•

our

cal

for
of

atten¬

current economics:

than

any

as an

our own

acknowledged and

open

gift

and not in the guise of a loan. The

the

of credit for getting
financially back on terra
Napoleonic Wars,

; /,/./;

•Tf

the

stable

least

axio¬

./'////"'■//•/fZ';'•'/'/-/■'/

State

must

is
to
prosper,
anchored to a

standard
be

must

and

controlled

the supply
by the auto¬

matic processes of trade, and not

by the dictates of
Here

again

government."

have the em¬
phasis on automatic control: posi¬
tively through money anchored to

growers in Malaya, ivory huntin Africa and tea gatherers

stable

you

standard, the

supply of
which is automatically adjusted
through the processes of trade,

inZ China, who perhaps have
never heard of our nation. Un-

former

This

appeal to bankers for

Z der free

policy in the interest
general welfare,
in the

the

place of

one

idends,

would

tailored to

However,

there is nothing to it
viewpoint. Monetary
values, prices, wage rates, etc., are
guesses except when generated in

from

either

free market with good money.

However,

nomics

the

status

much

science of medicine

so.
Few
if" any informed
Americans believe the terms can
be
met.. Then • why should; we
.

place the government of a people
whose friendship we desire and
whose aid we may require in a
mortal struggle in a position from
which it must emerge for the sec¬
ond time a defaulter upon its obligations.
This will neither help
us nor'Great Britain.
We shall
have parted with our money with¬

reaping the full return antici¬
pated, since British default upon

out.

second

ness

and

peoples.' V
As
we

loan

will

breed

discontent
'v

■;

/..,

are

among

/•

consideration

bitter¬

v. * \

for

both
/•''

this

loan

demanding of the British

abandonment

of. trade

practices
deemed by their leaders essential
to their recovery.
They are prac¬
tices

to which Great Britain

forced

tracle

was

making

before

the

second

eco¬

half ago.
When George Wash¬
ington,; having caught a slight
cold, called for medical aid, two
(some say three) blood extrac¬
a

tions

were

worked

stand,

than

his

man

sixties

over¬

could

Washington passed out.
I don't mean to say that all doc¬
tors in - Washington's time bled
their patients to death for a cold,
but

did.

one

Dr.

omist
in

Here

Lewis

recent issue of the

cle," which
futility
of

remarks

Haney, Econ¬
York University,

New

are

"Chroni¬

indicative of the

are

expecting

general

agreement upon such a policy as
is

called

bankers:

for
.

this

plea

' '

offsetting

(Continued

on page

refrain from

grants

doing

her

will reveal-both

intelligence and lack of

character.;

This announcement is not

ble

and

though they may
be followed/either at
abroad.. Nevertheless,

the .leaders

responsible
blind

nor a

solicitation of an offer to buy

The offering is made,

only

by the prospectus.

Chain Store Investment

they should be made even if pres¬
ently unpopular in some quarters,
since it is important that as the
tragedy. Unfolds people may know
that

offer to sell

the securities,mentioned herein.

sound

be,/will
home

I have lived too long to suppose
that the suggestions made, sensi¬

and

not

were

'» '"V1' "*

Corporation

lawmakers

following

'"*,W J'

s «»*•

path but an illuminated one,
precipice was clearly

100,000 Shares

and that the

visible to any capable person in-,
tent upon

seeing even

Common Stock

little way

(W Par Value)

Jewell College to Give
Truman Honorary Degree
President Truman has indicated

degree to be conferred

William
ninety

Jewell
seventh

Associated

College

him by

at. its

commencement.

Press Washington

vices of April 7 stated. According
to

•Z|

Charles G. Ross, White House,

press

make

secretary, Mr. Truman will
no

occasion,

formal

but

address

will

for

Of the *bove mentioned 100,000 shares of Common Stock
shares

ad¬

"'•*

were
are

subject

subscribed

to he

for

by the stockholders.

10,381

The unsubscribed

purchased from the Corporation by the Underwriters,

to the terms of the

j;- the Prospectus.

Underwriting Agreement summarized in

///'///

•

'■

the

merely speak

Copies of the prospectus

may

be obtained from the undersigned.

informally after receiving the de-

/,;"///•"'/ V:

gree.

First

Colony Corporation

France Ends War June I
The

war

France
ment

will end

officially for

June

the

decreed

April

Courts & Co.

Irving J. Rice & Company

vices from Paris April

16,

it is

16, which

added that the decision affects the

various

wartime powers.

J. C. Bradford & Co.

Govern¬

Bull, Holden & Co.

Clayton Securities Corp.

learned from Associated Press ad¬

governmental

Grubbs, Scott & Company

the

century and

adversaries and potential enemies.
lack

sustaining her foreign status

even

that

capa-r

say

div¬

better

his intention of going to Liberty,
ble of meeting the terms of this, Mo. on May 20 to receive in per¬
son
the Honorary Doctor of Laws
loan/ ; They have not hesitated to
do not believe

earn

stand

And above all let

investment
of

bankers, since the latter have to
report to a Board of Directors.

which

money

ers

not?

lowing,

££}'

hand
reaches, indeed,
./ far beyond our national bound¬
aries and sets to work rubber

bankers

chance with bureaucrats than with

matic:

others. This in-

the

about 1815 handed down the fol¬

and negatively through a govern¬
competition this procZ
profitable trade with Axis coun¬ :/ ess of adjusting production to ment-hands-off-money-policy.
Let us now look over the
part
tries and with countries now un¬
//fit the demands of the consum¬ automatic control
of the quality
der
Russian
ers, is purely
hegemony,
Great
automatic, calls for and
quantity of money is ex¬
Britain will more than ever be in
ho complicated system of adminpected to play in our current easy
need of the trade of her colonies Z astration, and works so
smoothly
money
policy.
Mr. Parkinson's
and dominions.. Having vast res¬
and with so little friction that
observations bear upon this phase
torations of her own- to perform
we
are scarcely aware
of the
of our problem.
Here are some
she will be cruelly handicapped in
fact that the tremendous ma¬
of them:
>
*
chine is; in operation,".
meeting competition of American
mass production.
"What are we' going to do
In V this quotation from Adam
Z with the money," a Philadelphia
ZZ If a' strong Britain is essential Smith's "W e a 11 h of N a ti o n
s,"
banker said to me the other
to our national safety let us not
which has been in the limelight
offset the grants we bestow to
day. "We must have earnings."
for
several
centuries, the em¬ ; "Well," I said, "I have some
make her strong by imposing con¬
ditions which
make her weak. phasis is on automatic control/ It
banking responsibilities myself

/ Shorn, of much of her

informed leaders of Great Britain

that country

back

tives to do it, at least, not until
the bankers provide the leader¬

;

after the

position, it

Clear that it should be made

seems

legs

soundness

ship and point out the necessity
the point of view of the
public welfare of doing it."

Britain

•

protection of

■

the

from

//;//,:■.;,/'////;>/;•'/'
Kicardo, who is given no

David

small

econ¬

"An invisible hand guides in>dustry in such a way that it
turns out those particular prod¬
ucts
which consumers desire

;

economic

following Z quotation firma

earlier

solid earth.

Economy will serve as a basis
an
analysis of the operation

our

not

our

from the Father of modern Politi¬

their

cur¬

pect the people themselves to
say, 4We have too much money
and we want to get this money
supply down.' And you cannot
expect their public'representa-

from methods that succeed and to
show what we should do to get

dis¬

care

our

generations were able
easily with the sort of a set¬
up that they had.
Our task then,
is to point to where we
departed

take

rency

above

was

the muddle in

Visible

long/in discovering that they
were at the same time
destroying

effort,

the

attracted

The

the

although

that

who,

upon either side, exulted in
destruction of the wealth of
their former customers will not

of. that

answer

You cannot expect the politi¬
cians to do it.
You cannot ex¬

to do

torted wage rates rather than easy
money

the greatest exertion of which

result

have

going

thousand miles away, who never
heard of our nation. Evident¬

aye doing with difficulty,
doing at all, with our
managed money, that which those

King's hand nor the
bankers' hands, but an invisible
hand, which sets men to work ten

„

"Who

the

not

even

through centuries of time. Trade fundamentally wrong with our
economy.
Although I had had no
pauperized
peoples yields
especial training as an economist,
little
profit.
Many years must
it looked to me as though we must
pass before British trade with the
have done, or left undone, some¬
Germans, / Austrians, ; Hungarians,
Italians, and the peoples of the thing vitally important, so I deter¬
mined
to
find
out
what
was
Japanese Empire will reach pre¬
wrong.
///':
,Z •:,•/•,/
war levels.
Generations
with

responsible."

2215)

page

earnings at

the expense of the soundness of
the currency of this country for
which
they
are
primarily

Can Its Excess Be Eliminated?

replace that which was
destroyed, y. Only by the most su¬
perficial reasoning/ can such a
viewpoint be sustained/ The de¬

the banks have

see

popular

the banks have

see

earnings, but I do not like to

great prosperity must
the war because of ' the

Great

far

belief that

'.i

V-:

For

deter¬

.now

position is

A large portion of
profitable European

trade is now lost

need

tered.

former

important

respect to the bold aggressions of
the Russian Empire has been al¬

her

letter

titude of

today.

to us, I,confined my discussion to
that fteld.
Since the date of the

developments
have occurred in the swiftly mova'ing international scene.
The at¬

War./ Her

World
worse

FINANCIAL CHRONICLE

IraHaupt&Co.

2242)

Thursday, April 25, 1946

THE COMMERCIAL & FINANCIAL CHRONICLE

2242

their

vest

When Is There Enough

Economic

opinion, the American
Association
and
its

to the

additions
and

currency

financial

our

setup

sentially radical element, which is

nal question, "How much money
is enough?" With gold function¬

opposed to the idea of economics
science, and has a closed mind
to the possibility of basing eco¬
nomic life upon a system of free
individual- choice.
Too many of
as a

leading colleges and univer¬
sities are dominated by the same
our

while in Government quar¬
of the 'economists' are
distinctly on the radical side."
;"At the present time, all I will
group,

ters

most

is that I

say

see

can

reason

why, in the name of truth and
justice, there should not be on the
faculty of every great university
at least as many economists who
take the
liberal point of view,
which I represent here, as there
are ort the radical side."
f

"The truth shall make you free.

find itl"
n
Our difficulty is primarily due
to impairment of the quality of
our currency/; through failure
to
anchor the dollar to an object,
But first you must

now

can

■

answer

does

of gold.
The current
theoretically,
contains
l/35th oz. of gold, although prac¬
tically it has been largely under-,
1-20.67

not

but

rule

out

real

money,

room for doubt on
Mr. Parkinson's show¬
ing that $5,000 houses sell for
$10,000, ought to be conclusive.

money

does, and that if additional token
money

/ the

to;

supply,

Remedy

these

anchoring the dollar
definite weight of gold, and
by

by requiring that

100%

gold be

impounded for redemption of any

courage bankers to

making

carrying Mr.

article y and

without much
Before

Mr.

en¬

join with him
much noise as pos¬

sible while correction is

anchor the dollar to too

loss.

practical

closing, I will reproduce
quotation from

Parkinson's

President

price readjusting.

dress,* which ought to especially

supply and demand prices.
This requires that paper money
may be added to the supply only
as
there is a shortage, and then
only
when arrangements have
been made far enough ahead so
;

that traders

can

make

for the contemplated

\ With
sort

all

it, to

unnecessary

outlined,

As I

disturbance.

coin

setup of the
have only to put

the

bank

toward

road

see

it,

would

;

become

$10

ments.

and

above the
It

CIRCULATION
\

1885

—

AND

1944 *~

This

rises

matter

plane of party politics.
concerns every busi-

of the
should

never

be overlooked. At

times like the present when the
affairs
of
unsound
finance
threaten us,

anticipate
the

from

the speculator may
harvest gathered

misfortune

others,

f] the capitalist may protect him0 self by hoarding or may even
find

•

profit in the fluctuations
of values; but the wage earner
—the first to be injured by de¬
preciated currency and the last

•

Doughton Sees Tax

Gut if

People Quit
Calling for Money
.

/ The declaration that "if the peo¬

ple will quit running to Washing¬
for

ton

can
reduce
April 12 by
Representative Doughton (Dem.)
of North Carolina, his remarks it
is stated by the Associated Press
having been prompted by Presi¬
dent Truman's assertion that "we

taxes"

are

money

the

anced

made

was

toward a bal¬
Mr.
Doughton

way

/budget."

Chairman of the House Ways and

Committee^ tempered his
forecast, however, said
the press accounts by telling re¬
porters the prospect is slim for
any further reductions this year.
tax cutting

The Associated Press,
advices April 15, also

Washington
had the fol¬

lowing to say;

Mr.

Truman,
too,
cautioned
against hasty action, saying in his
statement revising previous esti¬
mates of

tKe Government's fiscal

position

that

the

existing

tax

structure must be maintained "for
the present."

"We

■

well

are

the

highroad

to full peacetime production,"
President said, adding::V

the

"It is the aim of our fiscal pol¬
icy to balance the budget for 1947
to

and

retire

national

boom times such

debt

these.

our

present fight against inflation, fis¬
cal policy

has a vital role to play.
pol-'
icy,
which
is to maintain the ex¬
to receive the
benefit of its
isting tax structure for the pres¬
correction — is practically deent, and to avoid non-essential
fenseless."
expenditures, is the best fiscal
As hereinbefore explained, the contribution we can make to eco¬

writer

became interested in the
working
of
a
free - economy

through

comparison

past

and current wage rates which re¬
act to loss of supply and

control

demand

promptly than other
values.
The accompanying chart,
entitled "Free vs Managed Eco¬
nomy - in
Relationship.? to
Wages," was the product of my
effort to try to understand this
problem.";: This, chart traces our.
monetary operations and their ef¬
fect on wage rates in several lines,
over
a
period,, of nearly sixty
years.
An interpretation of what
to

learned

from

forth in the following:
* V. V -V' 1'

h"'-V.

;

••v:

'■

•;

set

(;'.%}*V: •

•:

;

chart

that

shows

nomic

during

Federal deficit for the fiscal year

ending June 30

the

under*

managed

continued

1942,
wages

money,

incon¬

but

advance

During

1914 to

years,

that by 1942, the aver¬
age-rate in manufacturing had
been upped 250%, from
100 to
350, while in agriculture the aver¬

sistently,

age

had

been

50%, from

upped

100 to about 150.

This

than

some

trades—accounts

for

the

other
unem¬

running $4,300,000,000 higher than
estimated,

and

timated

that

fiscal

the

nated

without

work.

While

currently, it is bound to re¬

appear
war

with

the

termination

activities, since

wage

maladjustments

ing eliminated-but
The immediate

employment

the

know that

are.

not be¬

increased/

cause

the

of this

impoverish¬

lower

paid third of the popula¬

ton

Agriculturist

amount

reads good where he

avoiding
but

need deed

well

doubt Mr.

added

word."

Truman

cere," 'Mr.

Doughton

"Now if

can

tion
in

ex-:

"we

sin¬

continued.

get the co-opera¬

Congress, and the people
kinds

all

talks

unnecessary

penditures,"
"No

Mr. Dough¬

"The President's state¬

said,

quit

groups

ning here for money,

run¬

ought to

be able to balance the budget and
reduce

taxes

too."

"Moreover,"
maker

get

coal,

tion

/:/;:;/■

the

asserted,

all these

steel,

veteran

"if

automobiles

can

get

can

behave, and

things, there is
in

and

telling

the

law-,,

way

We could stop infla¬

quick."

Noting that 1946 taxes already
have been cut

$6,000,000,000, Mi*.

Doughton,; backed
man's

call

for

their present

Mr.

keeping

Tru¬
at

rates

levels, asserting:

and

in time of great
nessmen

prosperity.

the

see

Busi¬

budget

paid.

"But if the people will quit call¬

ing

buy enopgh of the product of the,

use

paid to provide jobs for

want

balanced and the debt

tion to where they are unable to

higher

will

about $64,700,000,000.

"We must pay some of our debts
un¬

ment

expenditures during

year

production.

were

$2,600,-

expenses

000,000 lower. His new report es¬

of which decade from 5 to 10 mil¬

job-scarcity has been elimi¬

total of

about $21,700,000,000. Receipts are

what

this

the

below

estimate—or

January

ployment of 1930-40, during most

lion

is expected

now

$7,000,000,000

John L. Lewis to

200%—fivej times greater

advance

28 years,

index of about 67 to 100.

reported that the

Truman

about

1885 to 1913, with gold
as the unit, wage rates advanced
consistently, about 50%, from an

stability."

Mr.

*>2:;

mmmM Has Failed
This

A continuation of our present

ment

Where Managed Money

SJ940,

HAND

calling and enters
household in >■ the land.
one important aspect
subject which especially

There

substitu-

RELATIONSHIP TO WAGES

sound

...

and

ness

vitally

every

will have done this with¬
other than the

out loss

depositors will seek to in¬

their

Their
right to in;t jure them by financial experi¬

proceed along the lines
successfully, when we
are through we will have passed
through an experience that often
disrupts nations, impairs their in¬
tegrity, if not their independence,

sound

entitlted to

government has

indicated

course,

en¬

of the, United

people
are

and stable currency.

Eagle; the Eagle a double Eagle,
and the $20 double Eagle, a quad¬
ruple Eagle,
'
\ v:
If

■' '"The

•'

States

then

Means

clients'interests at heart:

those directly

ad¬

1893

labor leaders who have

list

most

upon

Cleveland's

salary workers and to

arouse

impose

could advantage¬
ously return to a dollar of 1-41.34
oz.
of gold. The former $5 gold

allowance

interest rates
will then automatically advance
to where currency hoarders and
money.

anchor

benefited like certain debtors.

of the

well

gold,
hardship

everybody, except

monetary

little

too

If we

"Chronicle" for

•

President Century Electric Co.
St. Louis, Mo.
,</
April 24, 1946^-:-V:/v;^V'^;^/^/,

much attention. We ought to thank

Parkinson's

: '

condemning
bad
that has gone up thus far.
I have been crying for a decade
but never succeeded iii attracting

the

living.

PILLSBURY,

much gold, we shall be in danger
from hoarding, and face too much

FREE VS MANAGED ECONOMY IN
MONEY

standard of
E. S.

money

that point,

both thus face short rations or a
low

the

noise

ing. If there is

is to be injected into the

Parkinson has made

setup, this, must be done so as not
to interfere with the generation

gold we have back of
ouroutstanding currency, then
add to the supply of dollars only
gold, for instance, as well as by
an
excess
quantity of currency as 100% gold is impounded for
owing to inadequate limitations their redemption, and we will be
defects

Mr.
loudest

A large percentage

the latter.

all is well that ends well.

mined for current domestic pric¬

require that token
be anchored to real money

to function

oz.

dollar,1,

does

money
so; as

token

opinion, the exact weight
the dollar to which we

return, is not of prime importance.
Our dollar : originally
contained

yardstick of value, all
the good money there is, is just
enough, and, conversely, any .bad
money at all is too much.
This
ing

our

in the place

1000 one. A small price to
considering that with the aid
of this bad money, we have won
the two most dangerous wars in
the history of Christendom; wars
which we might have lost if our
style had been cramped by good
money.
Let us be satisfied that

of gold in

origi¬

our

rates, and monetary values

generally.

j •/.,;/v/

impregnable.■

500 dollar

pay

the road toward normal opera¬

wage

supply,
will be

or§$ji, 'The American Economic
Review,' are dominated by an es¬

hold¬

tions with supply and demand in
control
of
prices, interest and

(Continued from page 2241)
my

excess

exchanged for
we shall be well

ings have been
long-time bonds,

Can Its Excess Be Eliminated?
"In

When these

bonds.

Money?

holdings

excess

Washington for

money,

and

their;own resources, we can

reduce

taxes, too."

Volume 163

duction
•%>

for

*i./

all

stressed

current

panacea

economic

ills,

;

whether inflation, deflation, un¬
employment, industrial unrest, or
social

inequities.

tion, they tell

produc¬

"will eliminate
the inflationary gap."
^

us,

self creates increased money sup¬

not

ply seems to have been generally
neglected in this argument. True,

sure.

Character

Production

duction"

means

pro¬

nothing unless it

<v;:'

is qualified by severe restrictions

and exceptions. Production, itself,
is not a simple concept.
It is a

heterogeneous phenomenon, with
diverse and conflicting elements,
and

its

character

and

purpose

must

be .■ analyzed
and
distin¬
guished in each case.
It may be

•;

at times uneconomic and wasteful

School

mechanism

< y

tion and not for serving human
wants.
However, it, like other
categories of production, created a

;
•:

need

for

larger money supply,
of creating that
was
at hand, increased
a

f Since the
supply
1

means

production

was balanced by an inmoney'supply. - But the
utility of these goods and services
has passed away.
Yet the money
represented by it still remains.
I There is, therefore, we are erroneously told, a large new "pur¬
chasing power created."
When,
i creased

;

of consumers'
a

goods'

pro¬

balanced condition

effective

tremendous volume of production,
Yet, most of this was for destruc-

X;
,

for

duced under

barter

exists,
money ^ is
needed only to balance disequili¬
bria in demand and supply, just as
in
international' -trade,
gold is
needed and used to bring about a
balance of payments.
But, under
a money economy in the modern
distributive
process,
a
greater
supply of currency (i.e. the ex¬
change medium) is essential to
ever

effect

increased number of

change
terms

ex¬

transactions,; if prices in
of

money
are to
remain
f:;Yet, the chief defect in
quantity theory of
money (as graphically represented
in
the
Fisher
Equation) is that one
however, relatively little of ecoTnomic utilities arises from a vast side of the equation (volume of
volume of production, purchasing goods) is affected by a corre¬
; power is actually diminished even
sponding change in the opposite
,

stable.

this

so-called

in the face of

increased volume

money.

fact,

purchasing

power is not measured by the vol-

ume

of circulating medium

accumulation

the

existence.

power

V X

Let

the

therefore

cease to

spread

doctrine that

erroneous

war¬

time production added to purchas¬

ing

power.
This production, was,
in effect "unbalanced production."

comprised

output of goods
and services not adjusted in char¬

iH'

acter and volume to the needs of

theproducersthemselvesnor to the
various elements of the public.

It,

therefore, led to a condition of
disequilibria. ■ This, in turn, put
prices and transactions "out of
joint," since normal distributive

•S».;

processes, by means of which the

relative values of goods and ser¬
vices are adjusted ~by the eco¬

(money-supply).

words,
a

weight

Thus, increased
can

and

divided among

is, of course, postulated on the
principle of heterogeneous and di¬
versified production.

Money

Supply

The present condition

over-

supply of currency in relation to
Supplies of goods, we are told, can
be remedied by increased civilian
production.
Since there
is
no

.longer
a

need for

war

materials

large scale, production

directed

toward

can now

output

products for which existing money
will be spent because such goods
are

needed

sumers.

demanded by con¬
When this sort of produc¬
or

tion catches up With the "pent up"
purchasing power accumulated in
the war years, there will be an

equilibrium of

money

supply and

goods, and therefore the danger of
inflation will have passed,

But,

stated in the "Porgy and

side

places

money

■-

increased

complished without

expansion

of commercial credits.

it could

also

ac¬

Of course,

be accomplished

fiscal policy which would dimin¬
ish the inflated volume of circu¬

lating medium created by govern¬
ment fiat under war emergency.
The latter is undoubtedly the san¬
est and "safest method though not

the

easiest, since it will lead to

higher interest rates, and disturb
price adjustments. All this means
that

money

should

not

kept

the

means

dollars

deficit predicted

when HOLC

Fahey, Commissioner of the Federal Home Loan Bank Administra¬
tion, reported on April 6.
The Corporation was more than three-

ment
Mr.

down

now

Fahey stated.

$853,951,000,

central

credit

excess

expan¬

the

past under a sound
banking system. A rise in

profit of $22,600,000,
paying all administrative
expenses, bond interest and prop¬
erty losses; it is added that the
cumulative
taken

losses of $337,246,000
the Corporation in the

of houses

sale

obliged to

was

foreclose has been reduced by net

earnings to
000

the

Fahey

balance of $50,371,-

close of the year. Mr.

April 6 said:

"As HOLC

-:C

estimated

six years

it is now apparent that, when
liquidation is completed,, the Cor¬
poration will be able to return to
ago,

suffering

lion
1933

half

billion to

bil¬

dollars, generally expected in
when the Corporation was

and

speculation.

But

and

owners

halt

the

real

estate

mortgage panic of the time.

adverse effects.

borne

But it should be

mind

that

with

the

swollen volume of deposits in the

banks,

commercial credit is
available than ever before,

now

and

thus

created than

currency

sibility of Excessive credit
sion

under

can

before. The pos¬

ever

the

lax

expan¬

reserve

re¬

"Of

;

the

198,168 properties the
Corporation took over during its
operations, 197,799 had been sold
by the first of this
of 368

ance

closed homes

the

real

were

estate

The fore¬

sold

would

small propor¬

System is almost astronomical.

credit

for

is used to create

making

(i.e.

when

currency

permanent

invest¬

ments. that prices are affected and
inflation can take root and have
a
'•

rapid and noxious growth.
Now,

these ' deductions

are

sound

(and their soundness is evi¬
denced by their adoption as the
foundation

principles

One

the

said:

chief

benefits ex*
pected to result from this action,
and one which will aid firm cus-*

tomers, is
of the

a general speeding up
telephone quotations serv-r

ice

member

quotation
quotation
be

firms.

board

Four hew
in

sections

room

the

exchange

activated

simultaneouslytl>e opening of the new posts

The

general

stock

issues

redistribution

the trading
floor posts will result in a simila
more
practicable distribution o:'
the

work

among

load

room.

The
of

the

quotation

cut

ago

activit-

back

severr

when market

activit

was

;

quotation service,

which

years

in
•

hot-house

plant;

that

banking principles should be fol¬
to a greater degree than
ever in granting bank
loans; and
that

safer

tary

system

and

sounder

should

mone¬

adopted
than the present mongrel, crazyquilt,
ramshackle existing
one.
Instead of enacting laws to en¬
courage unneeded and uneconom¬

ical production;
ating'.additional

instead of cre¬
credit '.agencies

of $249,000,000 and the number of
remaining borrowers' accounts de¬

clined^ from

586;000

483,000.

Over two-thirds of these accounts
now

have

than

$2,000

them

are

balances

and

due

nearly

less than

less

40%

of
President

$1,000.

"Up to the end of December
1945, more than 348,000 of the
Corporation's borrowers, or over
one-third of the

total, had paid off

their

full

loans

before

final

payments were due, out of their

/savings.
The
Corporation
charged to its operating expenses
over $58,000,000 of costs incident
to placing the loans on its books.
It advanced

$465,000,000 for taxes,
$225,000,000 to repair and recondi¬
tion the houses
loans

which it made

and

$18,000,000 to' absorb
delinquent insurance premiums.

central

to
compete with private insti¬
tutions; instead of keeping .in¬

terest

let

rates

the

strive

low

monetized national

government

return

debt,

economists

to a system of
production and distribution which
automatically will
balance
the

supply

money

chasing
turn

power

the

so-called

pur¬

with the needs of

business.
to

;

old

Let

again

re¬

idea, which the
long to estab¬

Anastasio

Somoza'o'

Nicaragua has announced that the
Council of Foreign Bondholder:
in

London

has

ernment's
tion

rejected his gov f
for a reduc¬
3%
and; 1%

proposal
from
4%
to

amortization

bonds.^The

own

on
' outstanding
savings, he said, were
s

have been used

bills incurred in
the

urgent

pay

connection

with

and for payments to the

war

United

States

Government

for

Lend-Lease and obligations of the

Export-Import
that

Bank.

General Irving

added

A. Lindberg,

Minister, of

Customs

and

trustee

and

the

government's

and

Trade

"At its peak of operations, ad¬
ministrative expenses of the Cor¬

sound

announcement also

when credit is used to foster pro¬

needed

neyv

posts to relieve the situation. The

Corpora¬

over

not

has been coordin¬

opening of the

declined, has been handling a
average of 40,000 incoming tele
phone requests for stock quota¬
tion state:
tions daily during the recent surg
"Over a period of three years of trading activity. Furnishing c\
'ending in 1936, HOLC refinanced quotations will be considerable
more
than a million delinquent
speeded up by this new expansio' <
mortgages, which on the average particularly during the first haT\
were then in default nearly two
hour of trading each day, whe:
years on principal and interest and
the quotation room has been averr
three years on taxes.
aging 10,000 incoming calls, thu.
"During 1945, the loans were Curb Exchange believes.
paid in full or reduced by regular
principal payments to the extent
The advices from the

form of

York

United States entered the war."

by choking the
nation with "greenbacks" in the

exchanged),

New

disposed of before the

were

this is meant that it is represented
by a value which is in the process
of being produced or exchanged
for money.
It is when credit is
extended
and
currency
thereby
created for the purpose of merely
enhancing values (as when there
is
inordinate
speculation, fore¬
stalling, hoarding and the like), or
that

the

general redistribution

ated with the

rapidly

market

permit and all but
tion

The bal¬

year.

hand has since been

than cut in half.

Exchange that two additional

that

with

Of course, under present condi¬
tions, the task of making money
dear by reducing its volume or
severely restricting credit is dif¬
ficult and complicated. * It is a
remedy which may have serious

of stock issues

capital provided.

-t.-

lowed
:

"values in existence." By

and

will

ignored,

are

announcement made

trading posts would be opened for
on its
trading floor that day*
The announcement
pointed out
that considerable congestion has
developed on the Curb Exchange
floor during recent active "sessions

wound up, the Treasury will also
receive a moderate return on the

Corporation's affairs

use

When the

long acknowl¬
sound, seem now to be

poration were at the rate of nearly
$37,500,000 a year and 21.000 peo¬
ple were employed.
HOLC's ap¬
propriation for the present year is
$5,660,000.
This is a reduction of

cannot

Curb

increase

enjoyed by the
exchanges
in
recent

April

the

volume

months is

these principles, so

should not be fostered by unlim¬
ited bank credit; that "sound risk"

credit * is
of cre¬
ating values to be exchanged. Mt
is thus distinguished from capital
credit.
In the language so fre¬
quently used by the Federal Re¬
serve
Board
(in its rulings re¬
garding "eligible paper" for dis¬
count), self-liquidating credit is

duction

trading

securities

edged

Self-Liquidating

concerned with the process

Indicative

after

and

Curb Exch.

operating

established to aid distressed home

curb

Trading Posts

that during 1945, HOLC had a net

the discount rate has been in most
cases followed by a fall in
prices
a

It is indicated

losses of

created, John K.

was

fourths liquidated at the year end,^
with its $3,500,000,000 total invest- "

flation and

production should not be "forced"

of payment as

II Credit
self-liquidating

All

billion

the U. S. Treasury its $200,000,000
of
capital instead of

sion

Fahey Reports

supply

Without Loss to Govt.,

Final operating figures of the Home Owners' Loan
Corporation
to last Jan. 1 assure the liquidation of the
Corporation without a
dollar of loss to the Government instead of the half a billion
to

cheap, but it should be made dear,
if inflation is to be curbed.
This
has been the weapon against in¬

quirements of the Federal Reserve

it is correspondent^ increased or

based

Production May Mean Larger

one

ture, i.e. when it increases and de¬
creases

Function

are

under

Moreover, without a convertible
production, when credit
currency, ■ there is no. natural or
is employed in procuring that in¬
effective check oh the volume of
creased production. Hence, credit
the circulating medium; Thus; we
expands with greater production can have a
great boom, with full
and with increase in exchanges,
employment and an industrial ex¬
and contracts when production is
pansion and prosperity. But should
reduced; If, however, credit is re¬
production be allowed to get out
strained and kept in proper bal¬
of balance so! that the distributive
ance by checks on its quality and
function cannot operate normally,
quantity,, and production is' also we will again^have : a < "grand
adjusted to consumers'needs (i.e.
bust," regardless of continuation
does not become
"unbalanced") of
OPA, or other economic con¬
the price level is not likely to be
trols,^ or so-called precautionary
substantially affected by changes measures that the Administration
in the scale of production.
There and
Congress might enact.
will accordingly be no inflation or
If the: foregoing
reasoning is
deflation, particularly when the
credit is of a self-liquidating na¬ sound, it should be evident that

decreased.'

the claimants, so that each claim¬
ant can provide, in a degree, Tor
his particular personal needs.
It

curbed

usually does arise from

distribution of production, there is

human efforts

other

the other side.

inflation

Curbed

to be reduced and

are

increased

weight added to

nomic laws of supply and demand,
could not operate.
In the normal

systematic adjustment, by means
of a money and credit economy,
whereby values arising from joint

of the scales automatically

savings, or by
Purchasing
is the faculty of acquiring
through exchange the economic
utilities needed or desired..

wealth

side;

Inflation May

prices

production, the result must be

effecting the ex¬
changes be created?
It has long
been an accepted principle of eco¬
nomic theory that the greater the
volume

How

still fail to grasp its

men

value, and it will not reduce the

bankers and

production. At other times, it may
supply and. demand,
be useful and beneficial produc- the greater will be the number and
tion. It may be excessive in cer- the size of exchanges, and, under
tain categories,; and deficient in the,ideal of a perfect system of
dthers.1 1 's
"*
1
barter, no increase in money sup¬
Thus, during the war, we had a ply is necessary,
In fact, wher¬

economists;

If, in essence, goods and ser¬
vices are exchanged for goods and
services (as every student of ele¬
mentary economics is.taught), will
not
the
required money as a

cause

so-called existing money surplus.

Professor

full significance.:

But this shibboleth "more

prices! It will not

of Advanced Studies, has
pointed this out—but the great

specialists,

business

Important

in costs

the dollar to return to its pre-war

mass
*

affect present inflation pres¬
It will mean no reduction

as, for example,
Robert Warren of the

few

,2243

Liquidation of HOLC Assured

(Continued from first page)
' Bess" song, "It Ain't Necessarily banking throughout the world)
others, harp upon this same slo¬ So."
any increase in volume of civilian
The fact that under our credit production brought about by the
gan, ad infinitum and ad nauseam.
Thus, production and more pro¬ economy, additional production it¬ use of self-liquidating credit will

4. -:

THE COMMERCIAL & FINANCIAL CHRONICLE

:i:::

Production, Money Supply and Inflation

Number 4484

ago.

the

$3,600,000 from two years
Personnel now employed by

Corporation number 1,550."

fiscal

1909

agent

sterling

bonds, may go* to London to dis¬
cuss

the matter with bondholders.

Air Mail to Far East States
Postmaster Albert Goldman

nounced

an-

April 17, that articles

acceptable for dispatch to Brunei,

Redeem Belgian Bonds
J.

Morgan & Co., Inc., and
Guaranty Trust Company of New
York, as sinking fund administra¬

Burma, Hong Kong, Macao, Malay
States

(Federated

and

Non-fed¬

erated), North Borneo, Sarawak,

Siam, and Straits Settlements will
Kingdom of Belgium be forwarded
by' air when pre30-year
sinking
paid at the rate of 70 cents per
fund 7%
gold bonds due 1955,
or
fraction
therbof.
have drawn by lot for redemption half-ounce
on
"values in existence." Let us on June 1,
1946, $1,178,500 prin¬ Articles for Siam, it is stated,
reestablish a monetary and bank¬ cipal amount of said bonds.
Pay¬ may not exceed two ounces, while
ing system which will serve to ment, at 107% % and interest to
articles for the other destinations
check credit over-expansion and June
1, 1946 will be made at the
keen the value of the
monetary offices of the administrators in listed above may weigh up to 4
unit relatively stable.
New York.
pounds 6 ounces.
'v.

nation struggled
lish—an

elastic

supply
expanding and contracting with
the need of the times, and based
money

tors for the
external

loan

Thursday, April 25, 1946%
1
<■

....

...

This is shown by Charts 7
and

Charts 3 and 5 show the differ¬
(Continued from page 2216)
or
benefited alike, there would ential effects of
disequilibria—in¬
be "nothing to it."
Individuals flationary and deflationary. Note
and economic groups endeavor to the differential effect of
inflation,
take advantage of the situations since 1940, upon the
several eco¬
created
by rising prices, or to nomic groups, especially
upon re¬
hedge against their adverse ef¬ cipients of interest.
\
+
fects. As prices rise, the national in¬
Persons dependent on interest
>

come

tends to rise with them. Some

elements

other fixed

of the community em¬
opportunity to acquire a
larger share of the total.
Other

were

elements

far

brace the

suffer

decline

the

percentage of the total available
to

them.

Over-all, for the time
being, there is an apparent "wash¬
out" of effects.

Actually, however,

incomes

are

com¬

monly

considered the chief vic¬
tims of inflation. If inflated
prices
to remain

high plateau

above

trend, such persons
would be permanently
injured by
inflation.
Historically, as shown

by Charts 1 and 2, they have been
injured by inflation only for lim¬

inflation spawns inefficiency.
So ited periods; moreover, the inju¬
when a state of disequilibrium is ries have been
offset by advan¬
created, and differential effects on tages accruing to them from

plotted \ respectively on
semi-logarithmic and plain block

So I turn

to the main eco¬

now

nomic problem of these persons—
a
matter of growing importance
to

them

even

the

absence

inflation.
The

group

ically by Chart 6.
out

trends

- are

The smoothed-

based

for

the

upon

most authoritative data.
sumed

the rate of
per

is,

hundred, years

change

ago

okly 0.25%

was

annum; in recent years, that
just before Pearl Harbor,, the

trend of growth of the standard of

problem of the fixed in¬
is presented graph¬

come

One

paper. :

It is

convenience

that

as¬
a

fixed income, sufficient to provide

living

was

about

2.5%

much' '
per

destined to rise

pears

rapid-^

annum—and
even

ap¬

faster.

The upper heavy line of Chart 6
shows how the income of an in¬
dividual
sence

should

rise

the

ab¬

changes in the cost of liv¬

satisfactory standard of living, ing in order to participate in the
was
set up for an individual in general rise in the standard of liv¬
1900.
The dash line shows the ing.
The interval between^ the

continuance of the fixed dollar in¬
come.

But the cost of

trends

even

living, Chart

substantially

the

absence

upward
inflation.

price The fixed dollar income's purchas¬
important groups of persons are deflation.
If history is to repeat
ing
power, - therefore,
declines
experienced, social wellbeing is and inflated prices are to return steadily. This fact is
portrayed by
impaired, and economic growth to price trends, such persons will the lower solid line of Chart
64.,g
retarded.
This is the> compelling experience,
only temporary finan¬
But this is not all.M Our econ¬
reason to discover and to maintain
cial disadvantage from inflation
omy is dynamic, experiencing acequilibrium in the economy and and, possibly,
temporary financial
celerative growth. It is providing
thereby promote maximum pro¬ advantage from a
succeeding de¬
ductive efficiency.
flation.higher

and; higher standards

of;

uppermost line and the lowermost
line

indicates

how

far

short

the

income of the fixed income recipi¬
ent
is
of
providing for trend

changes in the cost of living and
trend changes in the standard of

living.
The
whose

for

case

living

provided

out of income from

all-inclU-

sive portfolio of common stocks is

somewhat better than that of the

being sufficient to provide against;
the rising trend of the; cost of,,,
living on the one hand and for a
rising standard of living on the
other. The essential facts are pre- r
sented by the graphs of Char.t 9.

The portfolio provides a slowly
rising dollar income—rising, how¬
ever, more slowly than the trend
of the cost of living, and, there¬
fore, as shown by the lower heavy
line

Chart; 9

does

not

jL]

even

yield sufficient income to main¬

tain the 1900 standard of living.^

Moreover, as in the case of the
fixed income recipients (Chart 6)
the dollar dividend-income makes
no

provision whatever for the cost

of increases in the standard of liv¬

ing.

The funds required to pro¬
of liv¬
ing ■ are indicated by the upper¬
most line (real per capita national^;
vide for the rising standard

individual income)

the

Chart 1

fixed income recipient. Neverthe¬
less, it is still deplorably short of

the chart.,

" ."

The simplified graphs, (Charts 6
and

have presented the most

favorable situations. .If changes in.
v

(Continued

on page

2245)1

Chart 2

iniiSKgnisft!

1800

Chart 4

f' ^3^-^

Chart ;3

$$$£

mSEQUHJIBRIA M BASJCi KONOMICL1

Chart 5

v'i' ^ "i

-A-H

:a:A'

Chart 10

iiBis

1930

lew

;; 1905

■

; i9i5

T1u.'-i

[Volume 163
portfolios
cause

for

have

of maturity of

other

THE COMMERCIAL & FINANCIAL
CHRONICLE

Number 4484

reasons,

made

be¬

securities,

the

following

Capital appreciation

(increase in

market values) may be considered
an

offset to the

disadvantages

re¬

adverse effects must be taken into

cited above in

,the

quidation of portfolio is employed
to defray living expenses. ;

reckoning:

\-'Yr.T. For

->;:

•-

•

many years income from
income securities has

fixed

j/.:

■

been

generally

declining.

Chart 10.
2.

Income from equities is

in-

eclining rate
there

is;

of the rate of
in the market value

of common stocks; and second, yields on market values
$ are slowly declining. ' Charts
.11 and 12.
:

'''

the

event

that li¬

It becomes clear from the fore¬

going that in order to provide re¬
cipients of fixed incomes or in¬
from

comes

industrial

with ; sufficient

funds

equities
to

meet

gradually rising living costs and
to enjoy average participation in
the rising standard of living, the
respective portfolios at the outset
must yield large excesses of in¬
come

over

years.

the needs of the early
an

alternative

ar¬

rangement
total

power

will

sum

be
adequate

may

which

made
by
purchasing

derived

from

Avith

the conditions of our dy¬
namic economy?
Charts 3 and 5
indicate
how
the
agricultural

the

of income and

principal^

liquidation of
by a special type of
growing annuity.
In

community and the entrepreneu¬
rial

annually
short, certain f kinds of income
just adequate at the beginning of

ness

span

come

life

totally

period of

are

bound

inadequate

meet
run

be¬

over

our

economy are re¬

within

generation

longer.

What

other

provisions

—

kinds
be

can

made

situation.

men, etc.—
In the long

in the

industrial,'commercial,

and service activities of the

munity

maybe,
;V Y:y' -v
income
to

professional

the

they "do all right." So also do
a place of useful¬

ness

versed,; The last mentioned pos¬
sibility is not likely of realization
much

and

busi¬

those who find

years unless fundamen¬

tal trends of

group—so-called small

cope

as wage

ers.

com¬

wages
.

employees

apprdximately

the

wages

long-term trend, though for some
there is a long, and,
therefore,
nearly intolerable, lag ' between
changes in the rising costs and
standards

living,

the

one

hand, and in earnings with which
to meet these cost

changes,

other

hurts

entity, demarid for
whose service holds up well in all
phases of, all business cycles. The

pre¬

persons.^

/yYYv''?
business

employed in manufacturing. The
incomes of all workers follow this

and salary earn-

Perhaps the best hedge of all is
afforded by a place on the
payroll
of

trend

general
sented

hand.

The

the

inflicted

thereby point to the need for mak¬
ing frequent, appropriate changes
to
the pertinent factors
of our
dynamic
and
rapidly changing
economy.

■

Chart

;-V:,

Real Per Capita National Income

..'■I,..-:

(itUHlOO)

liiiilPlliliilliliillllfliSpilillllilililittitlilllliliiliilli SEIiiiHiilliHfiliSllil atllllEll iMlllfsi'ssllililiiiaiillilli]

i0f!IIOll!l!iliiillliilllll!iifi!iiil3tll!nSi3!!l!!E iiiilllSlii ilililijiiliipiiiii 91

iHHumnuimuiiiuiiuiisiuiiiiiiiinsiiiiiiiiij iinjiiiKs tipiuuitiuim

lllSISHI

i illlj iplilifliliHliliHili

hhuiiiiii» nil

iiiiHiuniiiiniiiiii

BjHyiiiiiiHiiiniiHftiiHHiHiiiitiiliiHiHiiiiijlUiUiiiiiiisiiniiisiiEiiifiiiiiii miliumIiiiiisiJiifiiifiiiisii
Hlis!ISHlI!i!i!!I!0ii!Iii;l(llllll3ltllS{lilHllilii lliSIOllitilIii!!i!liimyS!lilSi§l lllSSllI ill fliffihilHill illiillllilli
i!ili;!§ii(!iiiiiiiiil!!iiiii!!iiii!lili!fiilf!it1!t3ill HKHUiil !il!!lf?!!ii!i!!l!H!ii!l illliiil
IHiHNiiliiHiHHSHiiilHjii!

UHiiimimiumiimmiHiui

mmm
lenHinKiisrHHiiif!

r;i;

MiSwii

Y Y'YY
;

Chart 12

Chart

»0V><

teiqrf
h
40

••

2246
■

THE COMMERCIAL & FINANCIAL CHRONICLE

The Problems of Tax
*

(Continued from page 2219)

Surely it is
Federal

not

crime

Government

the

for

have

budgetary surplus and the retire¬
ment of debt which it makes pos¬
A time of strong inflation¬

sible.

forces when incomes

ary

the ideal time for

surplus.

are high
budgetary

statement

last

Thursday (April 11, 1946), Presi¬
dent Truman said: "It is the aim
of

fiscal policy to balance the

our

budget for 1947 and to retire

na¬

tional debt in boom times such

these.

present fight against

our

inflation, fiscal policy has a vital
to play.
A continuation of
our
present policy, which is to
maintain the existing tax struc¬
role

ture for the

best

expenditures,

fiscal

contribution

make to economic
Not

inflation.

Time

for

when

tion

fective

Thus, after

great

view

the

not

plans, for

the postwar structural revision of
the Federal tax system would in¬

volve reduction of revenues.
This does not imply any aban¬

donment of the idea that post-war
tax
revision
will
be
needed.
Rather it suggests that the present

good

time

examine

the

problems of postwar tax revision.

the

meet

control

measures

addition

has

whole this has been
condition.

uncommon

Much

tax structure with which the

taxpayer, rthe

Government,

and

the national economy can live and
prosper.

"The tax structure that

taxpay¬

both individual and corporate,

ers,

best

can

live

with

will

meet

the

made up

to understand and

"The

tax

Government
will

ernment.

demand

consumer

duction and

manner

live

with

needed

functions of Gov¬
distribute taxes

designed to

the

serve

economic

policy.

It will be made

up of taxes which
administered fairly and

can

economically.
;;

"The

tax

structure

which

the

making

for

income

offset

the

and

our

•

;

high level of

forces

stability in
'

the forces

that

na¬

tend

making

for

in¬

economy

',,V

'~j

quite

important at this time is

inflationary

pressure.

the war, as well

time,

to combat

Throughout

at the present

the demand,

especially for

consumers' goods and
services, has
been excessive in relation to
sup¬

ply,

with

wards

resulting

inflationary

prices.

increases

pressure

spendable

Treasury

and

into

thereby

expenditure

revenue,

taxes

appropriate

draining

funds

the demand for
goods.
source of the demand
mental

to¬

Taxes help to combat in¬

flationary
off

pressure

are
a

the

reducing
When the
is

govern¬

excess

particularly

method of

com-

batting inflationary forces.
'

Taxation has another

bearing

inflation. The best preventive and
cure

inflation

increase

production.

Tax policy can con¬
tribute to this end by
minimizing

the restrictions which taxes place
on

production.

I do not want to leave the im¬

pression that taxation is in itself
a

sufficient method of combatting

and

resentful

considerable lag in public

tax program.

pleased

with

overpay their tax
certain

*•«««'-«/«i.'

current
to

its

out

who

the

are

system

deliberately

that they are

debt

the

Government for tax liability.:
v
Although it would be foolhardy
to forecast probable
postwar tax
,

revisions, it

are

upward direction.

sun"

almost

true

tax¬

There have been construc¬

developments and there will

doubt be

new

ones

Federal

tax

system

has
quarter of

developed over a
century or more and is the re¬
a great deal of
thought and
effort on the part of many
people.

may

for consideration.

hope

will not try to read a Treas¬
position into my remarks,
especially since many of the mat¬
ters are still in the study
stage
you

Thursday, April 25, 1946

corporation;. Taxes

problem which has received
great kdeal of c$iMderation both

outsidejjfrf the Govern¬
position of the

ment concerns the

corporation in

the-'tax structure.
It is generally recognized that the
present methods 5qtytaxing corpo¬
rate income leave-much to be de¬

Where

corporate

profits

distributed to' stockholders an
element of so-called "double tax¬
ation" results

income is
the

since the corporate

subject to tax

once

corporate

level, and the re¬
maining income again at the in¬
dividual

level.

extent

large part

in
the extent to which

the corporation is #ble to shift its
taxes to other
customers.

If there is

complete shifting the double tax¬
ation

ing

many

corporations.,
stockholders
■*

placed in the embarrass-

position of
without.

pay

method

having

taxes

to;
satisfactory ;
funds with

any

getting

which to pay. them. '
A third proposal is

■

in part the dividends

preferred stock and
in the
est

they

same manner as

stock

bond inter¬

deductible.

.now

£;• *

pay on

common

This ha$

been objected to in some quarters *

undistributed profits tax..

Another " proposed method ;is the '
partial exemption of dividends re- '
;

ceived

to anyone

else.

Still another

proposal is to treat

the corporation tax as a withhold,- .%
ing tax and to treat dividend in¬
come for tax purposes in a manner
similar
to
salaries and wages;

That

is, the tax would be com-"
to the stockholder on the
basis of grdss dividends before the
withholding of tax and the stock¬
holder would be given a tax credit
for the tax withheld and paid on
puted

his behalf by the corporation. This
method is followed in Great Brit¬

ain.

change in the structure whatever,
allowing the double taxation! to
continue but reducing its scope by

and other methods of

are

tion is reduced.

seems

To the extent to which there is
double taxation of corporate prof¬

higher rates than is other income,
accordance

with

of progressive rates.

disagreement

wide

perhaps I should say
particularly, among ; businessmen
as to which method would in the
long

have relatively the most %:

run

desirable effect

I *

the economy.

Averaging of Income

about " ;;
Where corporate profits are not corporation taxation 'is the belief %
distributed, the income f earned 1 that business expansion and the %i
through the corporation is in nu¬ willingness to take risks are remerous cases taxed at highly fa¬
duced thereby.
This reason, as
1

One

reason,

for

concern

proprietorships

One of the revolutionary inno¬
vations of the wartime period is

Correcting the situation is not a
simple problem.
The prices of
outstanding corporate securities

is, of course, a 12-month calendar!
or
fiscal year.
The accounting]

have become adjusted to the pres¬
system.' A substantial re-?

many

create

de¬

mand for

but

newly produced capital,
practical tax to achieve this

result has not yet been
at any

rate has not

attention.

developed,

come to our
•

; •,

system of current individual

our

The

Tax Administration

Problem

income tax payment,

emphasizing equity and eco¬
objectives, we should not
sight of the importance of ad¬

ministration.

Many

looks

paper

ideal

including the

withholding by employers of tax

nomic

lose

by polit¬
bear by
That kind

salaries

and

wages,

the

estimating and current quarterly

taxv that

payment

is worthless

tax

income

subject to withholding.

not

The first

because it cannot be administered

official recommendation for with¬

holding was probably that of the
Secretary of the Treasury, Mr.
Morgenthau, in November 1941
Withholding entered the tax sys¬
tem in a small
way with the Vic¬

reasonable

Government
payer

expenditure

expense

inconvenience.
be

measure

cannot

continue

to operate

the taxpayer is

and

tax¬

The

latter
a

expected

tax
to

effectively if
unable to comply

tory tax in January 1943 and
put

substantially the
basis in July 1943 by the
Tax Payment Act.
This
provided for the system

with it by a reasonable amount of
time and effort.
I do not have

time here to discuss the possibil¬
ity of simplification in the post¬
war

tax

point

mate,
sition

I should like to

few.

the tax laws apply to relatively
few taxpayers who have large and
complex businesses and can af¬
ford to employ the professional
talent

necessary

prepare

tax

However, even for
simplicity may not be an

The

com¬

the other. The

perfect.

The

clear

the

system of current

people, which is probably
imperfect knowledge bf

alternative

sion
and

in
>

under

than

existing

future investment

those

law.
new

im¬

The
corpo¬

rations, however, will depend on a
prospect

income

sufficient

both the corporate tax and the
individual tax.
"
*„ *'' ;
'")

pay

You

are

doubt familiar with

methods
are

allowed.

are

esti¬

But

great advantages.

There

that

are

occasional

impres¬

employers," employees,

professional people alike are

general

extreme

one

proposals to
the corporate tax
alto¬
These proposals not only

repeal
gether.

income

having

complaints but it

blessing. It is often at¬
tainable only at the sacrifice of
equity and perhaps of desirable

objectives.

methods

hand and of his income taxes

collection.

unmixed

economic

new

;•

The
payment system is more
convenient, makes payment eas¬
ier, and results in more complete

experts.

them

posed

reflect

well pleased with the
system and would not wish to see

lack

are

political reality
but also leave unsolved the prob¬
of

the

accumulation

un¬

one-year

tuating
more

accounting period flue-;
incomes commonly pay;

taxes than if the same total!

amount of income is

received
a 1
steady stream.
Conceivably, the
taxes on widely fluctuating inromft may be more than the totaT
income

over a

iS Our

tax

period of years.

system

into

taken

account

has

already '

these

defects

Business
incomes
and
averaged to the extent
that losses may be carried back
are

for two years

and carried forward
There are al^o
minor specific provisions, notably

for

two

the

option

other

riod

panied by proposals for forcing
profits out of the corporation.
Another
proposal
would
tax
corporations
like ■■<• partnerships,
that is,
no

tax

the corporation would
as

such

but

would be taxed

tive

the

pay

stockholders

their distribu¬
undistributed

profits of the corporation.
This
also seems an unrealistic proposal,
especially if applied to larger cor¬
porations with many stockholders.
For one thing, the tracing of the
eventual
uted

owners

tremely

of the undistrib¬

would be an excomplicated matter with

profits

years. »*»

to lawyers and some
to average income'

groups

taxation

accom¬

period.
Perhaps more im-j
portant is the fact that with the:;

where

sometimes

year

profits in the corporation.
Proposals for repeal of corporate
are

;

readily be at-i '•:
specific one-i |

losses

current

system which does not re¬
quire them to employ professional

double

pense which cannot
tributable
to any

aging.^,

mating which

tax

so-called

favorable

taxed

there

the

tax would give undeserved wind¬
falls to the many owners of these
securities
who
purchased
them
under the expectation of taxes no

lem

the

is defective in that there arei
items of income and ex-;

year

due io an

simpli¬
fying those provisions is simplifi¬
cation affecting the multitudes of
small taxpayers who should
have

vising the corporate tax structure.

person^ from

some

of esti¬
well as a method of tran¬
from the old to the new

estimate has proved worrisome to

the

v,,

by introducing elements of aver¬

knowledge of this income

necessary
accounts and returns.
Much more important than

partnerships,

y,.,

duction

ent tax

withholding system tends to keep

one

or;

in comparison with other in¬

come.

others, also underlies pro-4'

most of the proposed plans for re¬

tax payment are not

than simplicity
Many
of
the
complicated provisions of

the

Current

and

well as

posals for the more effective aver-'
aging of income over a period of
years. The income accounting pe-i
riod under our income tax system;

act also

These

important

present

collection method.

out, however, that simpli¬
for
the
many
is : much

city
for

system.

was

] ■;

and

even,

taxpayers.
anomaly is#very hard to get
out of the tax system.

savings

;

cor- 'm

interested

rest

not used

a*,

porations have been proposed and
under consideration. ; There

system

taxing

vorable rates in comparison with
business income earned through

should

These

and the individual tax rate.

iest taxes
are

tfs in¬

allow for the tax

but have been put there
ical pressure brought to

which

because of its resemblance to the

accident

because of ignorance,

permit

clear implication is that the heav¬

;;

•

corporations to dedubt in whole or

dsiappears and if there is
partial shifting «the double taxa¬

anomalies but with minor excep¬
tions these are not there either

people for example, reducing: the corporate tax rate

workers

not

world today are by and large be¬
ing used by the Federal Govern¬
ment. They contain many curious

pie who would prefer to make no

depends

The

in > the

which this double taxation is real
as
well as apparent

the distribution of the tax is

known

■'

There are, of course, many peo-

and

taxes

to V many

flf

Moreover,

its income earned through
corpo¬
rations is taxed at
substantially

best

respect;;
"M

would be

special tax reduction not available

.J;

sult of

stockholders so as to
paid by the cor-;
poration.
This has a number, of
.disadvantages,
among
them the
which must
precede, or at any
fact that' where the corporation
rate ought to
precede, the deter¬
succeeded in shifting
ijs tax the
mination of an official position.
stockholder would be receiving a
ury

are

taxes by fre¬
especially those

changes,

been

The

people

to be those who

seem

quent

present

that this

aware

Combatting Inflationary Pressure is particularly important, for
One of the economic
objectives
of,tax policy which is particularly

kind

hereafter,
but there is nothing known now
to justify the idea of a radical
change in the forms of taxes. The

investment de¬

and

most

attention called; to

consumer

•well

year.; ,: The

sired.

table result.

which strengthen

tional

and

the

inside and

tive

economy can best live and prosper
with will rely on those tax meas¬
ures

flation

the

by keeping genuinely curr
throughout the year and not
merely catching up by the end of

wildered

ation.

employment, with de¬
depression the inevi¬

4-Is

rent

the

investment demand, markets will
be inadequate to absorb the goods
poured out at a high level of pro¬

carry out

best

the

simistic statement from the Bible
that "There is no new thing under

and

is much easier to say than it is to

revenue

It will

ends of national

mand.

can

produce the

to carry on the

level

jrv-P

•

letter

flexible tax¬
they did1* the

even

postwar tax revision. Such expec¬
tations are not justified. The pes¬

labor, materials,
and capital goods. Without a high

easy

that; the

for

required
and

different tax system to result from

ment demand for

system

public would undoubtedly be be¬

that

ac¬

con¬

structure

exemptions do not

reduce the volume of business

are

and

themselves

understanding. I suspect that peo¬
ple would rather not. have their

simple and

venient to pay.

rates

important objective will undoubt¬
edly be to remove restrictions that

made,

are

attractive idea and

Occasionally people who ought
to know better talk as if they ex¬
pect a brand new and entirely

revisions

tax

war

ductive

pro¬

It is

often

ployment. We have by no means
forgotten the long period of de¬
flation
and
depression
which
marked the greater part of the
1930's.
Accordingly, when post¬

v*-i 4-

come up

economic conditions

forced to adjust

level of business activity and em¬

Accordingly, tax re¬
vision should be made, with an
eye to minimizing the repression

will

frequently of

at being
themselves to fre¬
quent changes., At best there is

has been the problem of
promoting and maintaining a high
common

test of fairness by relying -on lev¬
ies based on ability to pay. It will
leave the individual
adequate in¬
centive to risk his funds in

enterprise,
It
of taxes which

An idea that

proposed

down

ation

tivity and employment. There are
objectives to be achieved in a re¬ a number of
ways in which taxes
vision of the tax system.
In his may reduce the volume of busi¬
11945 Annual Report,
Secretary of ness activity and employment. An
the Treasury Vinson outlined
obvious one is by repressing de¬
these objectives as follows:
"4-^
mand, both consumer demand for
"Broadly stated, our objective goods and services and invest¬

yWVli Jh

It is important to live

Af'

the' spirit

and

speed

history as
relatively

T r*

•

that tax rates and exemp¬
tions should be rapidly moved up

lend

Let us pass in brief review the

>■:

|V*if ,4tit *

-W*

be helpful to ex¬
amine briefly some of the
ques¬
tions or issues that are
likely to

tax

few

last

part

day it may be a reality. But
traditional procedure for changing

have continually had to
the threat-of inflation, over
economic

tax

some

national

postwar

in order to offset such
changes.
This proposal has been
given the name "flexible" tax¬

Reduce

the

be limited

change

Production
over

that
will

been

ation.

Although

late is

problems

anti-infla¬

that

taxpayers

fair as it is possible to make it.
Another factor not to be over¬

laws must be made.

tionary fiscal policy.
Restrictions

wheih will

by the machinery and procedure
through which. changes in tax

the

required in

are

general

income tax

looked: is

existing in different industries.
Under these; circumstances specific

time for structural revision either
since most, if not all

could

power

face

this

extent

to
an

structure

shortages of different goods and
services vary so widely that "no
general
impact
on
purchasing

years

undesirability

reduction,

the

war

the demands

ure

for

in¬

payment

Moreover,

unrefined

too

kinds of in¬

tax

impossible.

flationary situations.

Revision
In

make their ef¬

strument for certain

can

Structure

needed for infla¬

may

T"l"\

increasing

are

use

taxation

our

they

control

repealed.

•1'•

thing, public plexities of the individual income
taxes tax are due in very largqe meas¬

one

the

stability."

Tax

For

resistance

present, and to avoid

nonessential

'~mrn

income

received

Further

earned

months

over

concentrated

extension

pe-v

longer

form, j

the

aver-,

be considered.'
postwar tax revision.
Thuslonger
carryovers
of- business.,
losses
have
been
proposed, al¬
though in part the lengthening of
the period would be for the pur¬
pose
of replacing the two-year,
aging principle

may

which has proved

carryback
fective in

de¬

number of respects.

of losses is, of course,'
not the equivalent of
complete
averaging for businesses. Both incarryover

dividuals
suoject

and corporations are
progressive rates and

Volume

THE COMMERCIAL & FINANCIAL
CHRONICLE

Number 4484

163

the

effect of averaging is to pre-/ same situation, may conclude that
-"vent the bunching of income re¬
the differentially low rate of cap¬
ceived in
in

specific

the

absence

higher

bracket

rates.

-from nonbusiness

tax

relief

overs.

carry¬

..'■,:

proposal is to allow

a carryover of un¬
exemptions somewhat analo¬

gous

to the carryback, and carry¬

forward of business losses.
if
,

family in

less

than

personal

and

excess

those

unused

course/
individuals whose

•who

are

the

have

not

casional

do; not fall be-»

alike

often

finally make
one

work

moderate

being

their

average

for many
return and

"killing" in

two years.

While

income

some

they

remains

may

averaging

vised

some

-t ■]

■

would

businesses of

think

may

Another

this

result

stimulating

the1

businesses, ; Still

new

persons: may

the sound economic growth of the
These conflicting views

Nation.

present a dilemna. It is a dilemna
which cannot be solved
by lower¬

changing

the

tion

for,

over

period

years.

been

proposed

accrue

losses,

with

averag:

It has
the in¬

in value and the decreases

value

everyone's

taxes;

obviously

the money must come from

••Family Incomes

somewhat less

come

some¬

:4:-

none of the many pro¬

for

important in¬

tax problem is also
.

likely to

the taxes on

crease

single

time

and

accentu¬

The

mar¬

community prop¬

seem

that

higher rates, accessions

group of

community-prop¬

erty

States,
and
the
possible
spread of family partnerships and
other methods of tax
avoidance,
the problem is one which should
be faced in the
/

■

K Estate

near

and

future.

Gift

any:

fact

that the estate tax

about

one

gift

perhaps

proportion

members

combined

levied

only
deaths,
similarly

percent of adult

the

difference

tax
an

even

smaller

individuals.

The

eral revenue.

it would

reduce
:

lower rates!

been

Finally; it

proposed to

completely
gains from tax¬

exempt* capital

accrued

over

cases

the

reduce

been

come

States

common

practice

reduce

More recently many

partnerships
often

the

in¬

taxes

have

been

family

set

effort to split the in¬

;

ation.

does not appear to be a good place
to take a dogmatic position. Per¬

courage

haps it would be feasible

should be drawn.

come.

Perhaps the Supreme
Court's recent decisions will dis
clear

this practice, but it is not
just where the line can' or

proach. the Problem through new1

yield

revenue

the

estate

and gift taxes is less than
the liquor tax or the tobacco tax.
In the fiscal year

1945, estate and
gift taxes produced about one and
\

tax,

Quite aside from averaging, how-

; The
question arises as
whether these taxes should
made

to
be

;

ever,' a reexamination of the taxation of capital gains and losses
may

•

occur <

connection

line but the difficulties of the past
suggest the desirability of some
kind of new approach for the fu-

Few provisions of the income tax law have
been more frequently

•

changed

given rise to

dissatisfaction

than

•'

those
relating
to
capital
gains and losses. The story of the
blind men and the
elephant is
peculiarly : applicable to * capital
gains and losses.
There are so

•

Finally, the present relation
taxes

the

different ways of looking
at them which affect the
attitudes

inated

reduced by lowering the
other income. This prob¬

towards their taxation.

one

lem of rate reduction is, of
course;

watching the rise and fall
security values may conclude
that capital gains are not income

a
general problem and not one
limited to the solution of the
cap¬
ital gains tax problem.: Undoubt¬

taxes

person

•

at all but accretions to
capital and

J that
.

•

■

Another person,

the fur

and

exemptions

Act

vidual

observing

coats, jewelry, entertain-*
ment, trips to Florida, and other
expenditures being financed from

bear

relatively little relation to
exemptions and rates, par¬
ticularly
rates
in
the
higher

brackets.
Excise Taxes

slightly

over

whose

and

;

the postwar tax revision.
In the
of the liquor tax, one of the
factors determining the tax rate
case

will

be the effect of the rate on
the ability of the enforcement au¬
thorities

manufacure

liquor.
such

the

best

this in mind will

in the

see

capital gains an obstacle to
investment policy.
A per-;
who is sensitive to

sound
son

may see in the failure

; as

others

demands
tax

for

;

may

be
a

property

present

exemptions

inequities minimum living

income the capital gains

whicli

small families.

securities

major

held

violation

ability-to-pay principle. A

until
in

the

person

close to the
security markets may
conclude that the capital
gains tax

discourages the

sale of securities
therefore accentuates

and

that

and

orolongs

Another

speculative

person,looking

are

largely

tained, and the rates to be applied,
there will be less important issues
in some cases, such as whether the
tax should be at the manufactur¬

Frailey Industries,fine.
CLASS A STOCK

in¬

PRICE:

strong
eco

reshare
p5$

for

mands
and

lower

are

below the

standard,

individuals and
There will be de¬

raise

the

tax

Edward R. Parker

espe¬

single

for

V ^

the

bone

democracy and that

our

165 Broadway

;

■

Telephone. COrtlandt 7-2973

bottom

ground that this class is the back¬

brackets in order to pre¬
vent undue reduction of consumer

purchasing power. There will be
demands to decrease the rates on
the lower middle class
on
the

Company, Inc.

(A/;■■

exemptions

rates

booms.

the

raise the personal and
dependent
exemptions on the ground that

cially

illicit

Aside from the question of rates

that

sure

very

argument demonstrating- the

to tax

death,

the

distribution

business costs and thus enter into
the general price level. Still other

indi¬

reduction

investment

everyone will have

ever

accrue

prevent
and

Some of the excise taxes
that applying to transport

possible condition and who must nornic desirability of his
proposal,
constantly buy and sell securities !'■
Thus, there will be demands to

with
tax

■

portfolios

income

comes.

A peris to maintain in¬

'job

came

liquor and to¬
Many of the excise taxes
which were imposed or increased
during the war may be considered
unsuitable for a peacetime period.
Accordingly, the excise taxes will
undoubtedly be reconsidered in
on

bacco.

and

incomes, others for the middle in¬
comes, still others for the. highest
incomes; some for earned incomes

people who receive them,
vestment

$6 billion,

half of which

from the taxes

58,680 Shares

many different points.
Some will
stress reductions for the bottom

come, at least in the minds of the
•son

which

1926

present

edly in any postwar tax revision

capital gains will be convinced
'that capital gains are
certainly in•

logical

rates

there will

such they should not be

-taxed.

very

Revenue

■>:

not

against the Federal tax is based

capital - gains and that!
other income be elim¬

imposed

Thus,

both

tax.

differential between the-rate im¬

posed : on

many
-

tax may still be attributed to the
donor for purposes of the income

exemptions there are impor¬ er's level or the retail level".
compulsory tant 4 questions
concerning
the
!
v:;;
joint returns were in force, two ;kinds of transfers
Payroll Taxes
subject to the
single persons who married might ; estate tax; The use of life estates
The payroll taxes- for the fi¬
Income Tax Kates and Exemptions
after marriage have to pay higher and trusts and other devices cre¬
nancing of social security are an
Still another; solution for the total
taxes than they did before on ates substantial
gaps in the estate
(Continued on page 2248)
.J
capital gains tax problem which is
sometimes proposed
is that the

with

postwar tax revision.

in the property and efforts of the

husband, the wife,
them.
However, if

gift

important revenue excises apply to certain durable
lowering exemptions ■goods, such as electrical
appli¬
and applying higher rates.
Pro¬ ances and business
machines, and
posals along these lines would were
imposed partially to discour¬
certainly meet with objections in age consumption
during the war.
some quarters where it is felt
that
In addition to issues
concerning
the rates are already too high and
the relative amount of revenue to
should be reduced. It is probable be derived from
the excise taxes,
that the levels of estate and gift the choice of excises to be re¬
source

►

from
property
recognized
transferred for purposes of

tation

V Some years
ago, the Treasury;
classifying
capital Department proposed compulsory
gains, recognizing, differences, in joint returns as a solution for the
assets, in the causes of the gains, problems of taxing family income
and in their significance for the
Compulsory joint returns would' taxes are more closely related to
economy,
I hasten to say I have treat all families alike regardless general social policy than to tax
no practical, suggestions
along this! of whether the income originated policy.
:

methods

Averaging

years.

status

The capital gains tax field thus

often

has

actual

family." On the other hand, in

the

tax, and the
not fit together
example, income

cal year 1945 was about

for revision of the estate and
gift
taxes.
Perhaps this is due to the

reacnes

For

situations

The excise tax yield in the fis¬

Taxes

proportion

tax

smoothly.

gift

the

to the

while

tax, the

in the past, but it would

with

which persons in the common-law
States have contended is far out of

prior

number

since the 80% credit of State taxes

gains
and" losses completely from other*
income and to subject them to a

them

death

There appears to be no
other tax problems, this one
great
is becoming more acute with the amount of general public
agitation

uation.

system. .'-y-Y'-• V;•
P e r h a p s ; the
family-income
question will limp along as it has

only at death and falls

tax

persons

many

ated by high tax rates.
ried couples in

a single
frequently been suggested
means of
remedying tnis sit¬

tax has
as

of the State death taxes to Federal

arise, namely, the problem of tax¬
ing the income of families.
Like

passage

gift and estate taxes into

above those due under the
present

erty States have long enjoyed an
advantage in
Federal
taxation

and

taxes

the

and does make the
argument that
lower taxes on its particular
seg¬
ment of income are important for

where.

married

lower

Undoubtedly I have

capital gains and thus
higher rates.
•'

most

pay

other.

extent business risks.

some

ing

the;

but

today at any given rate
missed schedule
while
single
persons
important demands. would not. Rate increases to make
In other words, every
group can up the loss of revenue would in¬
ments.

cessful—which are being rfrade td
transform ordinary income into
escape

re¬

their estates to greatly reduce the
otal tax.
An integraion of he

income

alike

some

able to divide the distribution of
;heir property between gifts and

estate

than

by building

only
tax.
The present relation oft
gift taxes to estate taxes makes it
possible for those persons who are
one

spects to those of compulsory joint
returns and opposite in other re¬
spects.
All
families
would
be

couples

people to take risks and
their money in new invest¬

husband

This would

similar

treated

has

would spread the income and thus

vin

results

riod and

long period of

have

one-half percent of the total Fed¬

■

have

crease
the tax rates on Income
from investments in order to en¬

between

and wife in all States.

by making gifts of
property from one spouse to the

A particular type, of income for
which averaging-has been pro-

tion

taxing method, on the one hand;
a longer
holding period and!
higher rates,;; and on the other
hand, with a shorter holding pe-

posed is capital gains.
Capital
gains taxed in the year of realiza-

tax

put

the

with

complicate
Perhaps

system.

Capital Gains and Losses

below

income

greatly

tax

also because

compensation and other

income

sion of

common-law

ditional complication, not only beit would reduce inequities

•

reduce

the

-cause

•

the

"averaging would be worth the ad¬

4 but

earned

credit

propose# to continue the present

would

the income

•

income

separate rate schedule. It has been

Unfortunately,

un¬

application
plans thus far de-

gains

to high-income

realization. ;ylt has been proposed
to separate realized capital

derive relatively
"little from it net-of tax.
;

difficult jobs.
To
there will undoubtedly
demands
for
a
substantial

end,

joint returns discriminated against
marriage and the family.
Needess to
say, the proposal for com¬
pulsory joint returns was defeated.
Another approach is possible to
the
family-income problem,
namely, to allow universal divi¬

courage

moderate for the particular
year;
it extends to the higher brackets
and

businesses

thesapie total income. This pros¬ tax base in that the benefits of the
pect gave rise, to great opposition; propery.may be
enjoyed by more
on
the ground that compulsory1 than two
generations with

their positions and seek their for-'

creases

the

in;

capital
gains tax system would satisfy all
of these people.
It has been pro¬
posed to subject capital gains to
full taxation, allowing full
deduct

relatively evenly over a
period of years.
Authors, actors,
professional men, and business¬
men

capital

low

presents

Certainly

spread

years for

this

little

their

2247.

executives, causing them to resign

posals

bunched in oc-!

instead

years

be distressed
by the efforts—many of them sue-:

business- losses

are

rate

other

low the exemption level who nev4
ertheless pay.higher taxes because*

their incomes

the market weigh much

growth

ex-

individuals

many

and whose incomes

•

market

desirable

incomes

in some years fall below

There

stock

person

exemptions
benefit only

emptioh level, but there are mil-!
lions of such families.

■

the

capital gains tax rates.

•

dertake

happens to

their own, which they may keep
until death or sell subject to the

set against the taxable income of
'the later year. The carryback and

•

expand

what

tunes

of
the
earlier "year
could be carried forward and off¬

•

Still another per¬

tnmk

exemption

the rates of taxation
executives in order to restore
their incentives to taxe risks ana

may

tax

would,

decrease

son

differentially

easiest

lates the boom.

pendent exemptions, while in the

carryover

the

as,

There will be demands

his judgment..
One person may' investment
income.
However,
deplore the inducement that the there will also be demands to de¬

de-i

of such, exemptions and accord¬
ingly subject to tax, the unused

;

securities

next year it has income in

■

buy

tax

Thus,

has income

one year

the

consequence to the country as at be
whole and accordingly would not earned
let the effects of the capital gains the tax

carryback and
used

stroyed.

way

receive

sources

ital gains taxation induces people

make net income after
taxes and thus, causes, or., stimu¬

Incomes

from 'these

V.;.;'-:

A recent

taxed
averaging; at

years and

society is headed for trouble if the
middle class is discouraged or de¬

April 25.194b

New York 6, N. Y.

THE COMMERCIAL & FINANCIAL CHRONICLE

2248

Blough Discusses
Jax Revise

Effect of Cartels

Problems!

f-7 (Continued from page 2247)
t
important element of the tax sys¬
which

tem

shall not discuss

this time.

They are .'a a somewhat
special class and are affected by
considerations which do not arise
in the

should

taxes
the

the

that

of most other taxes,

case

pointed out, however,
security payroll
taxes in every sense of
social

are

including their impact

word,

the economy and their impli¬
cations for the equity of the tax

Their relation to each

structure.

other and to the general revenue
* should

structure

looked.

not

•

Any

all

the

the ' tax

consideration

tax ^revision.

that

issues

may^arise

postwar

It may be expected
will come up

of them

most

for consideration.
not

not

even

lems

However; these
problems and
all of the major prob¬

all

are

the

which

are
1-kely to arise.
Thus, for example, the question of
taxing business operations carried
on
by tax-exempt organizations

Will

doubt be considered. There

are/also many minor

substantive,

technical, and administrative
changes that will be proposed by
taxpayers or others for consider¬
ation, tit would be possible to fill
several pages listing such issues
but

obviously cannot do

this time..'

cisions

*
t
It is clear that the problems of
taxation are not all behind us.
,

business

management,
they do the tenor
industrial life, will affect

determining
of

our

the whole

ment,
the

character of

this

our

"We

five

years

iron

and

steel

metallurgy, and
innovations as are being

such

and the methods
into the policies of

today something like
behind Germany in

are

introduced by our

iron and steel
'$ manufacturers are most of them
management in a system of free
merely following the lead set
enterprise is to gain a new insight
by foreigners years ago. ,. . We
enter

which

into

the

possibilities
nomic growth.
In

economics

the

our

free

the

believe

.77;; 7

;

eco¬

wholesale

so¬

imagination, initiative
enterprise which bring to¬

The

tax problems ahead have a
serious bearing for the future of
7 the economy. Tax policy involves
than

political

struggle
groups to push

among economic
.the burden of taxes off onto each

other.

The future development of

-the

economy,
the intensity
of
boom and depressions, the size of

business concerns, and the volume

of business and employment

;

all

importantly

may

affected,

in¬

deed, almost certainly will be im¬
portantly affected by the sort of
tax policies that are adopted for
the postwar period.

ingly,
tax

It is, accord¬
importance that

great

issues

considered

the

light of the best economic knowl¬
edge.

We should hope and strive

to raise and keep the level of tax

controversy above narrow self-in¬
terest and group interest and all
work together to promote the na¬
tional

)

interest.

and services.

A huge organization is
too clumsy to take up the de-

! velopment of
With

It is the continuous

-ends
and
organizes the- raw

which

means

market

the

the, bother of, develop*

not want

ing anything new,"

choice 7 of

judicious

It would
ways

every

^aspect of these operations,;

tices which violate the fundamen¬

from

'production

tal freedom of the market.

the

through

and

pursuing the illusion of false sta¬
bility, by surrendering to the in¬

management is called "upon to ex¬
ercise

tainment

technical

and

size, and by
seeking to preempt control over

ly look backward to the original
and incentives of produc¬
tions and forward to the ends for
sources

great

economic

undertaken. Management must at
all times consider how best to use
the

such acts are

sake

which

production is

means

hand, where to di¬

and
and

spheres

all

economy

economic-behavior.

All

constitutes the difference between
or

;

men, money

their

clients

concerned

listing securities.

The

ment says:
r

The

revised

effective
any

July

company

curities
its

•

.the

competitors, consumers,
finally toward society itself.
In every phase of its affairs, man¬
agement is compelled in justice to

owners,

the

current

July 1 may, at
its listing fee on

pay

chief

new

becomes

differences

between

revised schedule and the
one

are

follows:/

•

best interests to seek out

own

objective

standards

of perform¬
apply them with self-

and to

ance

searching scrutiny.

Industrial;management,which is
with

itself

must. also

for the first 2,000,000 shares, and
Vi of a cent per share for shares
m excess

paying the listing fee
-lump sum basis in lieu of

tinuing

annual

tinued

except

basis
for•

on
a

con¬

discon¬

additional

shares of already listed stocks.
3.
The
practice
of allowing
under certain circumstances cred¬

its

fees
in

current

applications from
listings authorized
is discontinued.
change in the fee

covering

prior
There

years

for bonds.

no
:

■

re¬

en¬

generally finds that it Is

threat to its own ex¬

refrain

practices
serious

from

monopolistic
indeed, to combat

and,

infractions

monopoly.

It should be self-evident that de¬

partures from the rules of enter¬

prise not only injure a free econ¬
omy,
but violate
the premises
upon which management is predi¬
It

cated.

within

unfortunately,-true
recent

adher¬

years

nate the market.

Management and Monopoly
;

At this point, it is appropriate

to ask what the

tween

oly.

It is

relationship is be¬

management

There
as

true

funda¬

management." In this

same

sense,

it is

assert that the same criti¬

But I
cism

equally valid as to many

that stifles individual initi¬

cracy

This

type; of bureaucracy in business
urid e r monopolistic
controls. It does not have a chance

tion is desirable and necessary in

Large

industries.

many

tions

are

opera¬

to be encouraged where

they really produce greater econ¬
omy and efficiency.
But the test
is a factual one which leads to
different

results

dustries,

and
should

which

.•

in¬

competition

the

decide

among large

even

different

issue

producers,

industry.

real competitive

terfere

efficient

with

mass

pro¬

But monopoly

penalizes
the most efficient producer in fa¬
vor of those producers-Who have
succeeded 7 in
creating g artificial
protective walls around* itheir in¬
duction.

dustries.

that

tO*i;me

seems

standpoint of* manage¬
that industry is likely to be
the

the'-'*most efficient5 which is

con¬

stantly kept up oh its toes by vig¬
orous
competition.
It
may
be

large
should

may

not be

small.

We
by size

concerned

illuminating to consider that
1911, the very year in which
Frederick
Taylor published his

cerned with the effect of artificial

classic study of scientific manage¬

xect

such.

But

protective

should

barriers

suosidize

which

con¬

ef-

ineiiiciency by tne

(c'r-t't i,

■i

-7.

•

re*

efforts

Un- 77

industry,

system of competitive en¬
terprise there are both incentives
and much greater opportunity for
a

those

having managerial tal¬

men

function freely and make
best contribution.
Indeed,

the extent to which such abilities

ents

their

utilized is

criterion of good

management in any field.
On the other hand, if a society
function

static

blueprint,
the

that

would

according
it

duties

management

routine

seems

less

and

inherently important.
The plan
for carrying on an industry would

from the top. The men down

come

the

would

line

orders;
other

merely

execute

free society,

hand,

each

superintendent,

administrator,

executive,

to contribute

encouraged

ideas and

should
new

plans, t1

new

Cartels

cartel

cisions

the

important de*
all made at the, top.

are

The administrators down the line

Need

Capitalism

Dynamic

execute

the

policy that has been

We live in a. dynamic world. If
the American system of free en¬

laid out for them, * They may be
efficient in a routine sense, but

terprise is to be maintained intact,
American capitalism must also be

they do not make the impact on
policy that men of similar talents
could do under competitive Con*

This means that it must
concrete specifi¬

dynamic.

meet some very

A dynamic

cations.

capitalism, re¬

constant freedom of op¬
for the emergence of

quires

ditions.

In *a
men

competitive industry many
are applying their managerial 7:

portunity

talents

new

inative

way.

concerns,

new men, new

industries;

new

products, new proc¬

dynamic

-They

and

are

imag¬

not just

carrying out orders. They are not
just interpreting somebody else's
blueprint They are making their
own
definite impress on policy.
Their function has real 7 impor¬
tance and dignity.

appreciate that there are many
Thus, I cannot urge too strongly
frontiers open to initiative) not that monopoly practices reduce
only in invention, but also in the the relative number, of men who
organization of new firms, in the contribute to industrial policy- ;|7
promotion of new products and making, and reduce the impor¬
in. the supply of new .types of tance of the function of manage¬
It is the

services.

prime concern

American J nthat access to the

management in

dustry to

see

remains

market

free.

other

Where

management

necessary

must stand ready to

the

which

that

likelihood

gain

assured, it must recognize

seems

right of venture cannot

the

be exclusive.

dom

claims

Management cannot

deny to others the free*
opportunity
which \ it

seek to

its

own

due.

■

is : my belief that society
makes Imore rapid progress and
:

better life for all when
people as possible are ap¬

provides
as

many

plying their wits, their imagina¬
tions, their strenuous efforts and,
indeed, their whole abilities to ad¬
vancing the techniques of busi¬
ness and industry. We do not want

people than necessary
doing just routine work. We
want an ever-increasing number
of men and women to be func¬
any

anti-trust laws do not in¬

The

individual

the

encourage and not

those who work in

der

flourishes

to be

tioning

jobs

where

there- is

ah'Jopportunity to develop what¬
latent

ever

envision

they possess.
system of enter¬

powers
a

prise in which there is an oppor¬
tunity for every person to exer¬
cise his own peculiar capacities
to the utmost for the satisfaction
of his own deepest desire for Self-

expression through creative work.
Not only does the individual de¬
velop the best that is in him un*
der such a system, but society is
the more enriched by the produc¬
tive efforts of its members when
they

,rr
i

organizations

ative and lessens efficiency.

individuals

as
■

■

•

which exists an encrusted bureau¬

tively hazardous enterprise or one

ment

drive and initiative
are confined 'by the

to mere routine tasks.
I
do not deny that in some instances
there is warrant for this criticism.

system

stration i s heeded before a group

is only one answer.
today as it was when

mental proposition that "Monopo¬
ly
.is the great enemy of good

their

losing

because they

terprise system.
Whether man¬
agement embarks upon a rela¬

that

stifle

were

demon¬

sure

sponsibility to

duplication of function; about men
and women in government service

ment of

industry.

pression in their work.
Thus, management has

are

must be

But I

the greatest area for true self-ex*

political forum about the evils of
bureaucracy in government.
Much is said about red tape; about

blessings of size in business
organization, readily jump to the

from1

Adam Smith stated it

capacity for exercising the re¬
sponsibilities of management be¬
cause they have been trained and
seasoned by the competitive strug¬
gle.
v
We have heard so much in the

willing to accept risk. It
take a chance
conclusion that the anti-trust laws and to abide by the loss or gain
interfere with efficient manage¬ which is the outcome of an en-?
the

monop¬

and

competitive system produces more
men and women with developed

this uncritical view of

who -hold

to the

principles of free en¬
terprise has all too frequently
been breached by efforts to domi¬
ence

Words, management must itself be
among the foremost to recognize
that unless the pathways of dis^
Anti-Trust Laws and Efficient
Management
covery, of initiative, and of prog*
ress
are
kept open, the scope of
There is a notion held in many
its
own
potential development
quarters that size and efficiency
will become sharply limited..
necessarily go together.
People

specialists like yourselves to
in the internal administration of prove that large-scale operations
industry, and in its capacity as a are not necessarily conducive to
prime mover of our economic sys¬ efficiency and that many times
tem, management carries a double the smaller units in an industry
This
responsibility not only to adhere may be the more efficient.
to the rules of free enterprise but is not to deny that mass produc¬

2,000,000.
2. The present optional method

7 ••••'•
.

possible to conduct business prof¬
itably at the same time that the
interests of the community 7 at
large are advanced.
Hence, both

that

I* The basic initial fee for stock
is reduced from % of a cent per
share to % of a cent per share

{«,
:

progress as a
istence.

and

also

schedule

basis.

new

.7 The

announce¬
•..

1, 1946. However,
applying to list se¬

prior

option,

with

allocation

economic

most

of technical and economic
sources. When monopoly becomes
policy, and of perspective in es¬
entrenched V as privilege, & it in¬
tablishing and carrying on the re-,
creasingly stifles progress, be¬
lationships of
industry
toward
cause it must come to look upon

terprise

and

previously competitive industry
always frustrates the operation of
the price system.
It prevents the

sirnulin
and mate-*
a

rials,

its

management
is. doing, and

ting, the triumph of monopoly in

taneous problem of proportion

combining

it is

But

what

Managment is always

•

ineffective: ad¬

ministration of industry.

deliberate.

hidden tax upon

to esses and new markets. A vigorto Pus capitalist economy: is. distin¬
weigh the effects 7 of its actions; guished by the existence of a con¬
The fact • remains, however, that stantly widening range and varieof opportunities. We have come
whether it is conscious or unwit-;

elements, and many more beside,
up that "k now~how" that
effective

va¬

our

business

the

know

make

the

denial of the

economic system.
conduct may not in some in¬
of

stances

off

listing fees of the Exchange, for
the information of lawyers, ac¬
countants, and investment firms,

Such

these

NYSE Revises Schedule
Exchange
made
available
on
April
20,
through
Vice - President,
John
Haskell, a revised schedule of

lidity

the energies at its command,
how I to promote efficiency

rect

true to the? princi pies and aims: of
free enterprise. Management

The New York Stock

progress,

highly centralized management in
many industries has so conducted
affairs as to interfere with the
freedom of the market.
In effect,

the

I suggest that from the stand¬
point of promoting efficiency in
administration and management a

often follows the at¬

ertia which

precise but flexible judg¬
Managers must continuous¬

ment.

It is

equally obvious, however, that by

indus¬
marketing,'

problems

relations

trial

and } research,

imposition of
consumers.

large f business

obvious in many

seem

; that
management cannot
afford to sponsor or tolerate prac¬

materials of economic activity into
efficient and profitable units.
In

which adheres to the aims of

which

consolidation

dustry.

exercise of good management, the

honest

Listing Fees

the

original idea.
closely con¬
gether resources, equipment, and
trolled and profits certain by
people and combine them for the
following
standard
methods,
purpose of producing useful goods
! those who control our trusts do
and

cause

has taken place in American in¬

ciety, the factors of production are
not automatically assembled. * It
creative

main

ob¬

"Engineering News" stated:

econ¬

standpoint,

which

News"

"Engineering

made

was

ject lesson for Taylor's thesis. The

the aims

grasp

the Managerial Function

statement

could well have served as

From

omy.

777:777777:>7;

whicn I have discussed
in

Conclusion

over¬

(Continued from page 2219)
eration, and what consequences
they have, for American society.
It is at once apparent that the de¬

Thursday, April 25, 1946

are

allowed

ment for all but the few

Just
for

(political

■

'ft

for the development %
administrative and man¬

more avenues

real

agerial, talent.
From

this

standpoint it is en¬
tirely clear that; tartels,7the most "
recent
and
the most powerful
form of economic: monopoly, have
nothing in common" with' either
the principles of good manage¬
ment in industry or the system of;
free enterprise.
At the present
time the cartel philosophy rep¬
resents the crux of the problem
of industrial policy in this country« We have come to see in re¬
cent years that a representative
government, depending upon the
freedom of opportunity to stimu¬
economic

late

expansion and de¬

velopment must constantly be on i

the

guard

against

cartel

interests

prise,

Indeed

realization

the
not
and

of 77

attempts

restrict

have

enter* !,:

come

cartels

that

can¬

co-exist with free enterprise,
that if they persist they will

in time undermine

advocates

The

7'77.7; 7-7'" • !77of

cartels

are

define the terms
which they speak, for confu¬
sion suits their purpose—to retain
the appearance of enterprise while
eliminating the reality. Actually,
despite the many facile means
which 7 are
employed by cartels
and
their
proponents
to
mask
their true identity and to obscure
seldom willing to
in

their

aims,

the

real

nature

and

of cartels are crystal in
their clarity. I should like, there¬
purposes

their

to attempt a
unmistakable

tics.

In their simplest form, car¬

fore,

summary

characteris¬

tels
represent
an
alliance
of
monopolies for the purpose of
dominating the market, either in
whole fields of industry or
in

particular commodities. It is this
aim of dominating
the

central

v.''J f "

democracy it-*

self.:;!!';:':77777:7:777;

•fit

-'-IT

self-exp!:ession, so
industry provides

competitive

top men.

democracy: allows the in¬

dividual the greatest opportunity

{•'Ir-X.l^y^.A

}

'"•• -'. -Vv';.

•

,.-,y ■■':■■

'. *.

\..,

„•

■'. •' '.

rf'#*;-. •*"••'';••

market by

eliminating free

'>0 *

zenith in the cartel movement in

com¬

The organization of cartels is not

cartel

undertaken ,for

public pur¬
pose nor in pursuance of any pub¬
lic policy, but for the benefit of
specific private monopoly groups.
In some cases cartel control is

movement

sible

for

Unified and centralized; in others

1930:

"The

control

reached
A;, all tend at length to
include provisions for the division
of markets.
The whole world

any

and

3'^In the pursuit
tels resort to

shared

to be

was

pos¬

are

solidation

which

fixed

control the

terial comforts.

strategems and prac¬

tices which have the unswerving

safeguard

operate

They

ceases

of regulating the market
to suit themselves.;; Sonie of these
others

consolidation

discerned;

the

peace."

and

sure

the

reg¬

sold.

In this way the

market for critical

history

zations contribute to wars.

entire world

materials

raw

private

operations inevitably
verged with the functions of
ceeded

have been found in such
major raw products as rubber, tin,
'quinine, copper, and light metals.
more

difference

terms

the

It" is worth
noting that late in the 1930's car¬
tel groups in Germany and Great

industrial

activity and
whole sectors of technology are Britain felt themselves able to is¬
subjected to collusive agreement sue a declaration stating "the de¬
among the chief producers.
In sirability of eliminating 'destruc¬
tive competition wherever occur¬
some cases the* principal instru¬
ment of such cartels has been the ring" * and * asserting,
that they

unceasing.

mination; to
free

can

tion of

ing to

aims.

economic life accord¬

anti-trust

laws

their

and

American
economy
cannot
be
overestimated. History spells out
.

the

lesson

lives

American

and experience will want to start
in for themselves.
The oppor¬

more
man

that

few

laws

destinies

and

people

intimately

than

Act.

affect

the

directly
the

This Act guards

and

Jeayes
all

scores

doubt

this point.

such instances it has been

were generally successful in ployment and chokes off new out¬
thwarting public purpose and in lets for idle savings.
Monopoly
saddling their own decisions upon maintains prices at
artificially

the

dislocations

tion and of distribution

tempt to control the introduction
of new products and techniques
and to fasten a tight grip on the

petuated

scientific

Even

by> cartel

tion

of produc¬
were

tools.
on

Whether cartels
of

raw

are

based

materials

other grounds, it is their
customary practice to set limits
on the amounts of goods that can
be produced, sold, exported and
imported.
It has been usual. to
.place restriction upon productive
capacity.
It has been common¬
place for cartel agreements to
state among their first objectives
upon

.the elimination of any possibility
of

competition
producers.

the

independent

will

suffice

inherent

might

well

tendency

and the ultimate outcome of

telization.

car¬

In 1930, a year which

wpged war through cartels. ..Car¬
tel. agreements were utilized / to
restrict production in United Jfe-

tVqijia countries and to secure jfpr
Qprman companies exclusive mar¬
keting rights in large
world.

said

mark

a 1

the
limited

areas of

Other agreements

our productive capacity for mag¬
nesium, chlorate of potash, tung¬
sten carbide, beryllium,, pharma¬
ceuticals,
hormones,
dyes
and
many other vital war commodi¬

ties.

In truth, it

substantially

An-illustration
indicate

the

control

field

where

can

be said that

every

there

was

there developed
an

important
a

cartel

early in the
acute shortage.

What conclusions

can

war

be drawn

from this review of the effects of

counter claims have been "assert¬

ed."

This

rather

it had

disappointing
hoped that some

been

compromise

settlement

these

claims

might have been reached
by this time. President Van Wick
of Illinois Power asserts that the

plan is apparently "some sort of
to

maneuver

claims

get
around
our
North American"

against

and

that his company along'with
others
will
oppose
the
North
American plan. The claim against
North American has been
esti¬
mated

at about

$26,000,000, based
dividends, service and
transactions involving Illi¬

stock,

other

nois Power

made

by the holding

prior to

company

1933.

Hearings

these claims, which were filed
about four years ago, will be con¬
cluded in the near future.
•
on

Public holders of Illinois Power
would

receive

for

each

N. Y.

prices,

does
pro

the

not attempt to work out a
forma income statement for

new

company

the two

op¬

erating

companies, so that it is
difficult to compare;, the share
earnings

available

the

new

basis with the old. In 1945 Union

Electric; earned

Exchange Firm

BALTIMORE,

would

MD.—Henry

appear

to make

some

rec- /

ognition of the claims, but a de¬
statistical analysis would
be required to determine this. > %
tailed

——»

„

Detroit Bond Glub to

Hear

Utility Expert

DETROIT,

MICH.—The

Bond

Club of Detroit will hold its thir¬
tieth /annual

Statlex,

*oh

dinner

Hotel

April

30.
will be
preceded/by cocktails at '6:15 pjn.
1946.

The

Tuesday,

Dinner at
is

function

7 p.m.

for

members

Bond Club and guests.
/

The' guest speaker will be Mr:

Stathas,

senior

of
of Chi¬
public utility
partner

the firm of Duff & Phelps

analysts of
operations qnd* investments.

cago,

Stathas

one

Mr;

„

of the leading au¬

the^ United /States in
this field.He. holds • engineering
thorities

degrees from Marquette -Univer¬
a member of Tau Beta PI;
Association, the national honor¬

sity, is

engineering fraternity, and is
Chicago Invest¬
Analysts Society. For many
years he was associated with the
ary
a

member of the

ment

has

made

numerous

studies/for

utility companies, insurance com¬
panies
and
other
nationally-

Stock

partner of W. Carroll Mead, Pres¬

„

they felt

jt was.not desirable. »v j
v
chemical industry, M The facts about. the shortages
the electrical equipment industry, which cartels
created ; in many
the pharmaceutical industry, and critical materials needed for war
such strategic fields as military
production are now matters of
optical equipment and machine common
knowledge.
Germany
industry,

and

Utility Securities

(Continued from page 2220) v
companies
and
Illinois
Power*
merely indicating that claims and

Miller, member of the New York
Exchange, will become a .known institutional investors, and
for underwriters of public utility
nical advances which would lower ton; A.. Taylor, and J; Claire Sow¬ financing. :
.
...»
prices or improve quality.
Officers of the Bond Club are:
All ers, in the firm of Mead, Miller &
three of these monopolistic activi¬ Co., to be " formed as of May 6, President, Howard L. Parker of
ties very directly lower the stand¬ with offices in [ the First National M. A. Manley & Co.; Vice-Presi¬
ard of living — through /higher Bank Building.Mr. Miller was dent,/ Douglas
H./.Campbell ofs;
prices and lower quality of prod¬ formerly a manager of the Balti¬ First Michigan Corp.; Secretarymore
office
of
W.
E.
Hutton
&
Co. Treasurer,
uct — which
free
competition
Joseph F. Gatz, of Mc¬
Other partners in the new firm
would
Donald, Moore & Co. ,/
hjyprpye.
.
were partners of Mead, Irvine &
Plans for the dinner are under
/("During? the war, enforcement Co. Mr. Mead is a member of the
the
Of antirmdhopoly/ laws [ was l sus¬
supervision
of
H.
Russell
Baltimore Stock Exchange.
pended injamumber of fields>jiThe
Hastings, Chairman of the Pro¬
Government must now take, major
gram Committee, which also in¬
steps. nott .onlyxito maintain,wen¬
SEC Hearing Postponed
cludes Louis J. Groch, Clarence
forcement of anti-trust law?, but
At the request of counsel for A.
Horn, Ray H. Murray and
to encourage new and competing Ira
Haupt & Co. the Securities and Murel J. Sancrant. ■. /,//;/,
enterprises in every way." On
Exchange Commission has post¬
Guest tickets can be' obtained

cartels

able frequently, to prevent
development of manufacture
both in the United States and in
the

other countries in which

rise

14,|

Milwaukee Electric Railway &
Light".Co., serving in capacities
involving construction; engineer¬
ing, and special investigations. He

consump¬

lower

support larger
production and higher employ¬
ment.
Monopoly, not being sub¬
ject to competitive pressure, is
slow to take advantage of tech¬

agreements.

noticeably,

with

which,

would"

per

were

research.

Probably the most widely known
examples of this method of car¬
telization have occurred in the oil

high levels and reduces

market.; Serious maladjust¬

ments and

notable ingredient of policy to at¬

-.conduct

Mead, Miller & Go.
In Baltimore; To Be

tels

cases

Public

Sher¬
those

economic

tunity must be afforded them to
so.
They are the small busi¬

come
of $2,817,271
(both before
preferred dividends). Based on
these figures the/exchange ratid

the

enforcement to the future of the

•

ymrhiti

Evidence

*«>•

$8,535,963 com¬
pared with Illinois Power's net in¬

[rights (which parallel
support our political liberty.
The
nessmen of the future,
loss of economic freedom
"It is an obvious national policy through failure to; enforce the law,
^consolidation of - huge aggrega¬ would use their power in seeking
or by
allowing inonopoly to go
tions of patents.
In turn, these the help of their governments to to foster the sound development
It helps to "Unchecked Would soon bring into
become vehicles for furtherre¬ prevent competition by indepen¬ of small/ business.
the
whole
range
of
strictive measures.
At this point, dent producers in other countries. maintain high levels of employ¬ question
democratic institutions.
j
those who advocate cartelization
The practically universal effects ment and national income and
There are no higher concerns
have argued that the pooling of of cartel agreements during that consumption of the goods and
involved in the [domestic policies
technology and "know-how" by period were the reduction of out¬ services that the nation can pro¬
It
It encourages the compe¬ of government or. of industry.
■cartels actually stimulates tech¬ put, the increase of market prices, duce.
is as imperative for us to increase
nological advancement and the in¬ the reduction of employment, the tition that keeps our free enter¬
r economic freedom
in the years
troduction of more efficient proc¬ prptection of inefficient producers, prise economy vigorous [arid /ex¬
ahead as if Was for us to defend
esses,
as
well
as
products of the retarding of technical ad¬ panding. Small business, because
our national security in time of
the
higher quality.. The rejoinder to vancement' and the division of of its flexibility, assists
war/ -.5 In: this v undertaking,' i man¬
rapid
this view, is short and simple- world markets into
exploitation / of
scientific
competitionWhatever, ends/the cartel system proof compartments. In the realm and technological discoveries." In¬ agers' mf!; American [ industry ; can
find the fullest possible reward
may
pursue,
genuine efficiency of trade, especially, the private vestment in small business can
for th£ir proficiency at the-same
which will promote science, or treaties among cartels raised arti¬ absorb a large volume of savings
time that they marshal invention
might
otherwise
not
be
yield better products at competi¬ ficial barriers which necessarily that
and originality for the benefit of
tive prices, is not to be found disturbed
the whole course of tapped.
society.
This is the meaning of
among them.
The two conditions normal exchange.
"By strangling competition, mo¬
*
■ ,<
the American adventure in eco¬
which cartels fear most are tech¬
Where cartel policy ran counter nopolistic activity prevents or de¬
nomic democracy;
nological advancement and the to public policy, as for instance ters investment in new or ex¬
appearance of cheaper products in efforts to reduce or remove ex¬ panded production facilities/ This
made by more efficient methods. port and import barriers, the car¬ lessens the opportunity for em¬
Restrictive Cartel Policies

"*'1^

*•,«*'*'*, .■ *'. i

•>

monopoly blueprint. From
this point of view, the importance
a

the

their

keep /our economy
prevent the regimenta¬

our

democratic

admit

free society. A great many veter¬
ans and workers with
new skills

opportunity

liberties

alertness of the American people
and the strength of their deter¬

economic necessities but also im¬
portant practical demonstrations
of

economic

our

it possible to prevent such sabo¬
tage of a free economy.;, Only, the

eco¬

upon

Will make overt attempts to ex¬ 4/10ths of a share of the new
empt theiri own special, privileges holding company. Unfortunately,
while/the North American plan
from the jurisdiction of the law.
Only by unceasing vigilance is gives pro forma balance sheets, it

"A rising birth rate for small
business, and a favorable environ¬
ment for its growth, are net
only

making

nomic consequences.

important class

"of cartels is that in which whole
fields

government
their tool or whether government
took over, the cartels made little

this type

even

con¬

overcome

by. indirect methods, such as lob¬
bying, but when these fail they

State of the Union in January of
this year. The President stated:

gov¬
ernment. Whether the cartels suc¬

their production and
exchange.
The most prominent examples of

of these

some

become that the scale of

their

governing

rules

powerful did

cartels

has at times been subjected to a
set

proves

Indeed,
that cartel organi¬

enforcement of the anti-trust laws

ceptable.
The direction which our ener¬
gies must take -was accurately
mapped by President Truman in
his message to
Congress on the

the preservation of peace.

liberty and to

advocate

most

quotas of output and fix the quan¬
tities, the prices and the territory
in whi«h the commodity may be

fundamentals

They prefer if possible to hem in
the market by plausible excep¬
tions.
They seek to weaken the

required is so great that
How vain and forlorn was the
the
government
is J compelled
frequent of hope expressed by this scientist,
either
to
permit the cartels to do
cartel patterns, as well as one of the history of the last few years
the
the oldest, is the control of raw bears tragic witness. But
planning, or to attempt largecertainly
materials, by private monopoly the reasoning presented a / non scale supervision of the entire na¬
tional
economy.
It is impossible
groups either at their source or in sequltur because there is no ra¬
their distribution. Ordinarily this tional relation of cause and ef¬ to/believe that for this [country
pattern involves agreements that fect between organizing the any such merger of economic and
limit
total
production, allocate world's industries into cartels and political power would be ac¬

One

these

At the same time;
know that monopoly and car¬
tel forces will not often
openly

ulation

upon the market.

in¬

come

accepted

sanctioned, the degree of

can

always danger that if we take
liberty for granted it may be lost.
Monopoly never sleeps. Its pres¬

are

com¬

operate, when
longer able to

necessity. If cartels

can

monopoly,

the threat that monopoly will rule
the markets of the nation. • There

com¬

tract, unemployment increases and

prove

may

of the anti-trust laws to

economic

government intervention becomes

to be a
powerful influence in maintaining

vsiible in their effects

are

The whole world

pay tribute to • such a con¬
solidation.
Let us hope that the

object

market

When

see.

free

only in the

existence, and that the roads
discovery are open.
It is the

purpose

causes

circum¬

written large

are

the

such

functions, when
maintained at arbitrary
levels and
output is .restricted,
economic- activity begins to con¬

will

fear

about

the

ma¬

without

which

for all of

means

solid foundations of

ing inscrutable

advantage.

The

pressure

>•,

«i

tremendous

economy can be secure

prices

This

industry,
to full

the

'ij1

great skills of
management and labor

undertake the planning of
all economic life.
There is noth¬

portation, and a multitude of

general, however, cartels or¬
dinarily adopt a pattern or com¬

easily

the

and to

fulfill its intended

are

■,

the

use

and

that new industries

organic

chemicals.

by all
in

f
.

2249

exerted upon national economy to
abandon
the
enterprise
system

control of the world's food, trans¬

practices

pete

irresistible

■'<

knowledge that business

almost

petition

distribution
supply

;

world's

able

'*'.U !.>//* ■'
.f* .*

nitrogen, synthetic fuels and

and

the

interested

extent of their restrictive tactics.

bination

't"'

of
free
enterprise
competition is sup¬
pressed by. monopoly power there

stances.

are

where

of
of

production
most

seems

great con¬

will

be understood

who

that

say • fn

agreements, that

capacity

economy?

upon our

It should

maintenance

Of the chemical in¬

scientist

oly
of

major portion of
products entering into

cartels and other forms of monop¬
/:

tending toward

seems

limit to the number and

fettered

of
the

of their ends car¬
impressive array
There

chains

dustry, for,example, it

of ingenious devices.

agreements

industrial

the privileged few on the
of their relative size and

basis

industry,

world trade.

among

power,

''"

if A*/

international

diffused

-V

V'.'

■•-

petition which defines the cartel.

•■

THE COMMERCIAL & FINANCIAL CHRONICLE

"»

".■/

.n-rr* viW^ry-

;••

Number 4484

163

".-;4:

." ; '■ •

(

'".':. .^c.'

[Volume

•ii^<r^l^ri«H^^rrrrit»~*J4*rtti

"W^if-

,'..

•

The translation of this program
an
economic reality will be

poned the hearing in the proceed¬
ings instituted against the com¬

into

the surest guarantee that we shall
achieve high levels of production

Proceedings

and

der of Nov.,

have
and

employment,

that

rising [standards
that

shall

enjoy

pany

shall

free

from

the

croachment of monopoly we

30, 1944, to 'determine

whether to revoke

living
wider

or suspend the
broker-dealer registration of the

frontiers of economic oooortimit.v.
To the extent that we are able to

keeo markets

from .March 12 to April 11.
were instituted by or¬

firm

and

whether

suspend or
membershio in the

exnri it from

National Association of Securities
shall Dealers, Inc.
r
*
en¬

from Mr.
Gatz* 1566
Building, Cherry 9565.

Penobscot

M. Wittenstem Admits
DES

MOINES, IOWA

Wittenstein,

owner

—

Max

of M. Witten-

stein

&
Co., Southern / Surety
Building, is admitting Harlan W.
Wittenstein to partnership in the
firm.
'
•'
.

,A-

trendr of the/main list "(indi¬ that the paper profits in the
cated

Tomorrow's
Markets

Walter

Says—
==By WALTER WHYTE=

incidents

Increasing d own

point to
stocks now
objectives.
closing days of last
few signs of rally

and failures to go up
reaction.

closer to
In the

week

Many

The

made their appearance.

rails

well

the industrials

want to have

showed that these were

surface.

the

For

only
even

strength was obvi¬
of
stocks which either were dor¬

while the
ous

there were a number

mant

under
other

quietly

cover

sold down
strength in

portions of the market.
*

^Ordinarily this action
wouldn't be anything to wor¬

while
clines.

Brass

Bridgeport

de¬

The market is honey¬

similar

with

❖

exam¬

43.

136
129.

raise stop to
Bethlehem bought at 99,

now

about 107.

past such a condition

at the

top everybody is in and,

❖

better,

Sell at about

Electric Autohas been a prelude to a major Lite bought at 71, now about
break. The present situation 78, sell at 80 or better; stop
72.
Superheater bought at
may lead to the same thing.
Sis
*
sis
30, now about 33, sell at 34
or better;
stop at 31. U. S.
Inflation is supposedly
Rubber bought at 65 V£, now
right around the corner, and
about 80. Sell at 80 or bet¬
that, according to widely ac¬
ter, stop at 74. U. S. Steel
cepted beliefs, is the big rea¬
bought at 82, now 85. Sell at
son why stocks must go up.
87 or better, stop at 81.
I wonder what we've been
In the

everything js going to 200.
Same thing how is true of in¬
Another word for cutting
flation. Because we have had
you may perhaps be more fa¬
miliar with is divergence.
If inflation, ergo! we will con¬
tinue to have it—only strong¬
all stocks move in one direc¬
er doses of it.
The fact that a
tion that is normal. It is when
demand is there but that pro¬
some stocks move contra the
ductive capacity is well able
to take care of it, if and when
it starts moving, is ignored.
Trouble is that while produc¬
i'fi

Sell at about

about 134.

capacity is present the
to put it to work is
something else. And speaking

109, stop 102.

Chronicle.

get back to the mar¬
ket. I think it's about time

are

presented as

only.]

Rowland Murray

With
Ketcham and Nongard
CHICAGO, - ILL.—The invest¬
banking firm of Ketcham &

Nongard, 105 West Adams Street,
announces that Rowland H. Mur¬

is associated with it as
Sales Manager.
Mr. Murray, for¬
now

ray

merly

Commander

Lieutenant

States

United

the

Navy,

re¬

returned after 3V2 years
duty, much of it in the

cently

Mr.

area.

dates

from

1923, when he

partment of the Harris Trust &
Savings bank. Leaving the bank

1929, he later was associated

with

Brown

Bros.,

he was

entering the Navy,

the

Upham & Co. Be¬

Co. and Harris,
fore

Harriman

of the bond department

Illinois Bankers Life As¬

Illinois.

Coles Asst. Sec. of
Harriman

Ripley & Co.
& Co., Incorporated,
New York

Street,

Wall

City,

that Harry C. Coles,

Jr.,

Assistant Sec¬

Mr. Coles is a graduate

of Yale

College and Yale Law School. He

Members

(Associate)

and

NewTorlt S, fi. Y.
Teletype jr* 1-928

left

in
Private Wires to Principal Offices
l

San Francisco

Monterey
"w

—

Fresno

—

1938,

May,

Exchange
the

staff

Commission.

the

Sacramento

1942 to enter the U.

leased

early this year

rank of Lieutenant

Commission
S. Naval

Reserve, from which he

Santa Barbara

Oakland

joined the staff of the Securities

Chicago Board of Trade

COrtlandt 7-4150

Administration and later

with the Rural Electrification Ad¬
ministration.

York Stock Exchange

New York Curb Exchange

.14 Watt Street

service 'on

1934, first with the National Re¬

Schwabacher & Co.
New

government

graduation from '^aw School in

covery

If you

column

Britain,

crowning success of
the
fission
of
the
atom
has
changed all that, ladies and gentle¬
men.

Not

Sufficient

Is there any recourse

from this

situation? Unless Lmisread every¬

that

thing

over,

diverse

will find it was a
league, that the States

you

stronger

surrendered

than the nations

surrendered

ever

Nations

that

and

United

the

present instance,
league fell apart the

that

minute

the

Britain

with

of war
that

pressure

ceased,

and

held the States

pressure no longer

together.
And

so,

our

-league here

own

The
League of Nations failed to keep
the international peace, and, as
after the first World War, so after

World

this
the
and

get

world

War.,

the

"We

said:

In the

security.
this."

peoples
crave

name

peace

of God,

Steps Toward Creating

ynited

Nations

And

nation

our

took

the

first

It called the other large na¬
tions together at Dumbarton Oaks,
and
afterwards
called
all
the
other Allied
Powers and their

step.

friends together
in the hope of

written the world

the universal opinion

regulation of conduct of men
race and clime, by just
rules
justly
enforced,
namely,
government of a sort, is the only
answer to the problems of peace.
I don't have to tell you that his¬
that
of

the

will read it in the parallelwith the United Nations

Charter,

modern

but

member,

every

will, exist in the world, and
recognized, agreements be¬
tween those nation states, treaties
dent
are

at San Francisco,
building a better

But

structure.

what

have

built, ladies and gentlemen?
We
built a second league, a second
multilateral

treaty of soyereign
independent nations, every

and

of whom has

one

plighted its good

faith to cooperate, but. every one

of whom is the sole judge, in the

instance, what its good faith

last

requires it to do, in a given exi¬
gency.
-

And

are

hex'e again with

and

sovereign
independent
nations
banded together to do something

and

only

leagues/will'not insure peace,
I think that history equally
teaches that in any society, how¬
ever large, and whatever its units,
the road to world order is the

government and law and

road of

waf the

What

status

I? It
perfectly

world before World War

the
this
was

in¬
independent,
perfectly sovereign,.so-called, na¬
tions wangled what they wanted
by the threat of force, by diplo¬
macy, asSIias called, by pushing
world

.which

transigent, perfectly

forward

bit and pulling

back

bit, and always threatening in a
cat-and-rixouse attitude to resort
to force.

after

And

the fir£t World

War

that great idealist,

Nations

retary of the Company.:.

Colonies, formed a league known
as
the Articles of Confederation.'

long as good faith, selfother-mindedness, hold
those nations together. Nay, more.
Theoretically, we have formed a
league, a multilateral treaty be¬
tween the big and the little, on
the theory that the little nations;*
are
just as dignified, as indeed
they are, and as moral, as the big
nations, and just as much entitled
to protection, as the big ones: and
so

interest,

what does it all come to? It comes,
in

the

to this: We
tripartite alliance

last analysis,

have got a great
between

Russia, Britain, and the
For good measure,

United States.

know

gesture of generosity, we
France,
Big Five; but you
and I know that neither

China

nor

and

as a

have taken in China and
and called it the

France, nor China and

Woodrow Wil¬ France
together, will prevail in
Company of Monmouth, son, thought he saw a way to
the councils of the United Nations
avoid that sort? of thing; and his
against a solid front of Russia*
child, the League of Nations, was
Britain, and the United States.
■barn-, with which his nation would
Now, let us face what we have:
not affiliate.
But the League of

surance

entered

dence

has

League,

country in 1777,
declared our indepen¬
this

science by its

de¬

began his career in the bond

has been elected an

Exchanges

forms

Murray's investment exper¬

announce

Orders Executed on

tary might, either of the nation or
an
alliance of which that nation

individual;/

Pacific Coast

to safety and the security of
the citizens of any nation—mili¬

way

Pacific

The Board of Directors of Har¬

Securities

composed
sovereign
nation
world

the enforcement of law upon

riman Ripley

Pacific Coast

of socalled
states,
there has been in the past but one
In

of active

ience

after

tory teaches that while nation
states, of sovereign" and indepen¬

ment

that the

They

those of the author

better

the

We,

formed

League,

every

failed.

failed to fulfill its purposes.

Nations

views expressed in this

[The

manager

say,

lives.

Thursday.

article do not necessarily at any
time coincide with those of the

But to

what

—Walter Whyte

desire

productive capacity I feel;
day of the marginal
producer is numbered.

there

though

Agreements Among Sovereign

More next

tive

though they are old,
is nothing new in
I wonder if I may
shortly restate to you, a body who
carries a great weight of influence
in the country, and who may in¬
fluence anyone.
The only fact
which we all agree upon is that
men and women everywhere, after
this
war
ended, craved above
everything else peace and sur¬
cease
of national loss, the free¬
dom of every man and woman to
pursue his or her calling, his or her
vocation, free of restraint, free of
aggression, in accordance with the
traditions and the conscience of
the community in which he or she

been plowed,

Foundry

big ones: and that

act without the

League,

Therefore, though the facts have

Chrysler bought at 120,

now

it¬

self today.

ex¬

having in the past four years
about. But at this stage of if it wasn't inflation?
cycle anything that
*
^
*
doesn't perform well is open
OPA is going out of the
to/suspicion. An ideal per¬
window? Perhaps. But that
formance right now is an in¬
doesn't mean the market must
dication one day followed by
start
discounting all over
performance the next. We are
again
what it has already dis¬
not getting that—at least not
counted. As a matter of fact
on the bullish side.
On the
current inflation talk reminds
other
hand
certain stocks
me of the stuff we hear when
which don't look too good go
the stock market is within
lower
on
succeeding days
five points of making a top.*
th?n obvious performance in¬
At the start of the move no¬
dicates. This kind of action is
body wants them. When
what technicians call, cutting,
and a market that starts to they are half-way up there is
some interest.
When they're
market to stay away

(Continued from first page)
tion in which the world finds

bought at 60, now about 70.
ample are the rubbers. U. S. Suggest taking profits at 70
Rubber climbs up to 80 while or better; hold your stop at
at the same time, Goodyear 65. American Steel Founders
sinks back a couple of points. bought at 42, now about 45.
Among the non-ferrous met¬ Collect full profits at 48 or
als we see Anaconda advance better and hold the stop at
Prime

the

from.

To Enforce Peace

Car

American

cut is a

❖

Here is what you now

stocks

anything to do

other.

each

with

the
de¬ combed
spite the apparent indica¬ ples.
tions, .1 a t e r developments

Went up and the tone of
market perked up. Yet.

collected..

have
of different industries move and my suggestions: Air Re¬
in
different directions, but duction bought at 52, now
about 58, get out across 60
now stocks in the same group
are
acting like they don't and keep your stop at 55.
Not only do

tensified.

A World Government

by averages) that diver¬ remaining half positions

gence appears.
In the past
few days this has become in¬

Thursday/April 25, 1946

CHRONICLE

THE COMMERCIAL & FINANCIAL

2250

tioned.

re¬

with the

Commander,

bpm/&hd it func¬
it, ladies

have

alliance of three great

Powers. No little Power can

stand,

It was a multi¬ against it. No little Power, really,
lateral .agreement -between sov¬ and in the last analysis, has any
voice or say in the councils/because
ereign nations. | But' that League
these three great Powers, exercis¬
was even a strongest League than
ing the power they have, control
any we have had since, including
But the pity
the United Nations,; for in Article the world today.
16 pf; that League if was provided of it is that they control the world
that if any member nation went only so long as they stay in unity;
to war with any;/other member Picture to yourselves those three
nation, that fact itself should put great Powers falling apart on any
the Miole League; of Nations .at really vital matter of world in¬
terest, and you are nothing. I care
war with the offending nation,.
You know what happened. Mus¬ nothing about the veto power in
the Charter; it was put in, in/my
solini: went to war with Ethiopia;
V52 nations, members of the League, judgment, as a matter of honesty
and fairness.
Everybody knew
voted that he was an aggressor
and

gentlemen?,

when that Charter was formed
and a/ violator of international
that if. those three great Powers
morality. Was he punished? Was
did not hold a united front, the
he barred? Was he stopped from
United Nations was doomed to
his course?. ,.You know that he was
failure.-- And- everybody knows
not. Why? Beeaeis^be two rnos.ti
powerful members of "®t League. today; that a little nation, a friend
Britain--and Fra-icd, ;Celt\that at; of one of the big nations, or in' its
the

was

And what /was

moment it pas

And

not tp their; sphere of influence, will rbe pro¬
tected by that big nation, and that

interests -to :* stdo him.
the little nations, although

national

they were unanimous, could not

big nation will stand firm
and assert its veto power against

that

—

Volume

163

Number 4484

•

any discipline
.friend.
.

c
•

j
,

THE COMMERCIAL & FINANCIAL
CHRONICLE

of its little nation
*

...

I think the people of
do

not

all

our

realize it.

people—not the other nations but
the other

think

people have been given an
anodyne.
They have beep told:
"We have the
security; that we
expect another war; that
everything is all right. Go back
to your bench.
Go back to your

shop in safety."
They are worried. These stresses
arid strains that

appearing in

are

! the United Nations
procedure are
fretting them and worrying them.

They

beginning to question,
either going one way
the other.
They are going to-

and

or
'

are

they

wards

tion,

better

they

national

Now,
.

;

are

form

coopera-

lapsing back into

are

isolationism.

then,

ladies and gentlewill read the United

men, if you
Nations Charter, I think you can¬
not disagree with that analysis of
the present situation.
What will

do?

Our

national

own

coun-

people,

like themselves

chances

constant

tion,

peril

vote

for the general
alternative, the

utter

wronged in
other.
It is
that

...*

the

chances

States

country will make that
great gesture to the world.

You

Ohio

being able to defend yourself
against the atomic bomb, and all
the
rest, until
our
people
are
ready to go forward to a better
organization of the world.
If
nothing will be done, another na¬
is

going

take

the

told, on the one
United Nations will

out these
*

tional

work

problems of clashing

interests

the

hand,

long

and

will

You

run.

na-

save- us

told,

are

the other

hand, that we must
build the mightiest military ma¬
chine

have

that

these

United

known.

ever

States

I think the lat-

ter

the

sheer futility, in view of
As I have said, the

facts.

The

customers, and, therefore, private
deposits will increase correspond¬
ingly and the commerical banks

smallest

nation

devastating
atomic

could

bomb

this

while
we

might

such

with

nation, that
to reprisals,

•

damage
go

might counterattack with

our

•

atomic

own
*

bombs,

the

kind

world we would live in after such

blitz would not be worth your or

a
•

living in it.

•

Are you going to build—are you
going to attempt to build in the

United States of America

mili¬

tary machine which shall defy ai
the great Powers of the work
singly or in alliances? If you ar
going to change the texture o
:

this society, you cannot have tha
kind of a military machine with¬

they

have.

never

build that kind of

You

chine
'

without

cannot

military

ma-

Commander-in-

Chief who exercises the power of
an
autocrat.
You cannot build

that

kind

military machine
keep it ready for eventuali¬
without abandoning all the
dearest things that we have cher¬
ished as democratic people.
a

and

ties

United Nations No Assurance
There
want to

If you

UNO,

strong
enough,
strong
enough to do what? Strong enough
to

back

the.

the other fellow down

halls

."enough
back

diplomacy;

strong

to threaten the other fel¬

with

low

picture.

your

leaders tell you, you have got

our

go on under the

force

down.

technique for
worked?

that

That

has

150

years.

has

will

been

the

Has

worked

only to
the destruction, to the enslave¬
ment, to the degradation of peo.

pie- /

Must

then for the fu¬
playing
this
discredited
backed by power? Ladies

ture,
game

go on

jtnd

gentlemen, I think we must
the people of the Unitec
States awaken to their danger and
'act.
The people in this country
unless

must

lead

the' international

or-

ganization to which they belong
True; we stand in great danger of
losing it.
Our policies in Europe are ter¬

ribly deficient
in
feeding
the
starving people in Europe. All our
failures
•

have
and

thi*

been

nation,

many

since

V-E

obligation

ter

Day

V-J Day, all gn to show that
nation is net thinking of it?
in

the

international

•field. But We must lead to
*

there

and

bet-

organization of the world, or
be none, to get inter¬

thm-e will

national peace.

A Parliament of the Worbl

U- That situation

will

never

alter

wars

That

things

it is

over,

cussion, it is
are

can

United

fact.

The

place to talk

forum for dis¬

need

provide

1946,

excess

ought to

hanking system

that.

mated at

Second, the people ought to be
that, there is a hopeful way

1966,
to
be

maturity
The

reported,

1974.

serial

bonds

also

entire

offering.

The 'extent of the
competi¬
tion expected to
develop for the

representatives

groups

spzction
the

the

five

investment

bankers

tour

in-

district

during

April 12-14 week-end. Un¬

project,

the

total

cost

which

will be $12,000,000. The
remaining $5,500,000 of the cost

will be provided for by the Fed¬
eral Works Administration.
A

considerable

definitely

struction has already been com¬

giving

for

this

another

case

far

method

purposes

realize

vice

versa.

the

cannot

there

are

this world

and

will

extend

has

done,

Britain

has

peoples of

said

any

parliamentary
ment.

will

call

can

take

care

say, "If

such

the

but

government

where

a^ncy is not tha* ^ n3t'r"",r'
the
agency
is that which

springs from
in

and

will not

reserves

tically,

present

program

would

you and me to repre¬
all the other people

legislating for the? common
welfare—if- there are" people who

the

commission
through
sewerage
charges based on water meter
readings. Issuance of the bonds is

subject

the

approval

legal
proceedings by the Attorney Gen¬
eral
of
Virginia, and Hawkins,
Delafield & Wood, of New York
City.
The district includes the cities
of

Norfolk

and

Newport

and

neighboring

both

the

effect

its

not have

the

war

loan

perman¬

municipal

prices

loans

reported

country

continues

grow,

may

possibly be reflected in less

demand for Ohio municipals.

Roads

sides

Bankers

Conference,

since

Most

such
issues
have
been
small
school districts which do not sell
too readily
outside

Ohio,

which have found
ket

months,
banks

but

ready mar¬
Ohio
during
recent
mostly with., country i

that

have

shown

amazing willingness to buy.
i

."!

(

V-

-V

J'l v

country,

refund,

the

$75,000,000

city also plans

similar basis, the

bonds

payable

Canadian funds and the
$45,000,000 due in British and Dutch

cur¬

rency.

.7,

The

bonds to

United

States

sold

would

the

mature

serially until 1976 and be sub¬
ject to optional retirement at
call prices ranging to. 102. Pro¬
ceeds would be used in the rer,

demption

equal

amount

outstanding series A and B
debentures, dated May 1, 1944
and maturing up to 1972.
>
The

city,

will

recalled,

originally planned to refund the
$156,000,000 of outstanding bonds

The

financing

completed

and

medium

the

latter

February and, in the
U.

portion

registration
filed

with

part

case

of the

$85,980,000,

statement
the

under¬

scheduled to be

was

Canada

SEC

had

been

by the

pro¬

jected underwriters.
However, the deal fell through
a result of the city's dissat¬

isfaction with the terms offered
the

and

Canadian

portions of the loan. City offi¬
cials characterized the American
bid

Canadian
as

97.2955

group's

"not fairly

and

offer

represen¬

the

projected U. S. issue of $85,-

ciples of sound municipal invest¬

890,000

ment

maturities from 1947 to 1957 incl.

and

the

financing,

Mr.

handsome

News

other

Hampton

future

paid

Craigie

qualities

Newport

for

compliment to the in¬

vestment

the

outlook

included

Roads

and

Norfolk

and

cities

bonds

the

No city in

area.

Virginia has made

progress

financially

has

Newport

News,

than

the banker

stated,

its

net

bonds

debt

to
are

true

ratio

"now

valuation

bought by

the

Such

new

necessary

the

offered
issue

for

the

proposed

behalf of another syndi¬

cate headed by Otis & Co., Cleve¬
land.

Dealers in

4.1

NORTH and

SOUTH'

CAROLINA
of

case

Norfolk, the

mistakes

this

construction
as

was

higher price reported to have been

conser¬

remembering its retrenchment
struggles after World War I,
no

city's rejection of

offering terms

VIRGINIA—WEST VIRGINIA

banker pointed out that the city,

"made

A factor in the

the original

and

California."
In

from l1/4% to 3%%, for

ran

adding

market

15, 1947.

Contemplated interest rates

discussion of the basic prin¬

Ohio municipals that have been

year.

sale

tative of the credit" of the city.

vative institutions from New York

the

this

98.4651

try banks around Ohio that have
been the strong support for most

the

Feb.

syndicate's

1.7%

for

Aside from the debt payable in

the

only

into

000

both

It should be understood, more
over, that it is these same coun¬

first

offered

by the bankers, with respect to

will

and

its

coming

$22,460,000 on Aug. 25,
$20,095,000 on Dec. 1, and $22,474,-

that

the

remaining portion of

would

follows:

News

territory

north and south

Hampton

ginia

dras¬

of the Treasury

drawing down

very

Natural Bridge, Virginia.

that

writing groups in both countries.

received

revenues

permit

decline
seem

Re¬

sealed

initial instalment

June 1. The
bonds

currency

report,

from

the recent address by Walter W.

not

for the

States

Craigie, of F. W. Craigie & Co.,
Richmond, before the Sixth Vir¬

will

United

the

issue

write down their investments and
their war loan deposits.

authorities

the
pay¬

through

forthcoming

of these two communities recalls

loan

war

represents

outstanding bonds

$6,500,000 bonds will be serviced

The

cash, but will merely

out

demand

approve of

pooular government, a union

peoples,

Hampton

have

total

payable

are

banks generally, especially if such

units, the people

maturities

Ohio, especially by those
war
loan
deposits.

pay

for

such over-all
agency can ever
succeed unless a
great majority
of the individual

other

generally, but the present demand

with¬

ent

people of your countries to say if
they will have it." For, of course,

joir

waters

ating Base at Norfolk. Mention

people and the

can

the

correspond

excess

anybody is ready to meet

nor

and

sizable

deposits will

And if there are
I have no doubt there

they too
Treasury

Assuming that the Federal

government and

nations, as
who neither will

Indebtedness

Treasury

serve

us on that, let us come and
talk
it over, and then let us
put it back
to the American

are*

the

repub¬

it and want it.

also serve the huge Naval Oper¬

the

of.

jn the nations joining,

withdrawals,
soon

drawals, the banks

And I, if I had it to
do, would
lay down the minimal require¬
ments

have

bids

sewage
disposal facilities
designed to relieve the pollu¬

To the extent that such
maturities

lican form of government to take
care of those
things which no one
nation

which

loan

war

with

other nation in a
form of govern¬

should

Ohio

maturities

around

follow,
hand,
say

deplet¬

rather generally owned in worth¬
while
amounts
by
the
banks

many

joining

process of

likely find that

short

our

and

meet

cates

tions in creating a common
agency
to. outlaw
war
and
to
regulate

nations in

The

area.

obligations being retired. Certifi¬

States who have the will to join
the men and women of other na¬

that

around

have

I think
still
I think
still people in the United

believe

con¬

the latter agency.

tion

will

Power,
invention,

banks,

pleted under the supervision of

buyers of either municipals

weapons.

the

found themselves pressed for cash

ciple of it, and do nothing about
it?
My God, I don't think the
United States is senile, I think
still

are

banks

sovereign independent nation. Are
we so
senile, or are we so lacka¬
daisical, that we are all sitting
here, that we recognize the prin¬

are

Federal

ing reserves, should it actually
develop, will probably 'be slow.
During the process many of the

make

the citizens

govern

depleted,

However, the
that

the

volume

Governments, and the market^ Epads in accordance with the ex¬
for all bonds will decline.
pressed wishes of voters of the

limited

United States cannot legislate for
China, cannot legislate for Britain,
rules

reserves

not only in Ohio but
throughout
the country, will perforce not be

concerned.

are

Surely

one gov¬

th&be

deal

can

utting everybody under
ernment

seriously

agency limited
with things, that

deal

nation

no
v

to*

mwers

that

former

amount of

offering is evidenced in the fact

weeks ago. It can only be stated

excess

refinancing of the city's entire
capital debt of $202,574,000. The

allows

competitive bidding,

the $85,980,000
refunding bonds to
be Isued in connection with
the

$20,610,000 will be received about

redemption prices for the
sinking fund obligations and to
specify rates of interest on the

with about

obtaining a peace in the world,
the invention, if you call it
that, of 1787 in our own country,

Committee has anounced that the

city has decided to 'market,' piece¬
meal and via

the

told

with

Joseph O. Aselin, Chairman of
Montreal,
Que., Executive

the

Montreal to Ask for Bids
On Refunding Bonds

according to

esti¬

$820,009,000, compared
$1,000,000,000 a few

will

der the tutelage of district offi¬
cials, the group obtained a first
hand picture of the nature of

the

still

were

years,

and,

17,

reserves

$1,000,000

redeemed

debt]

substantially in recent

able

the

April

and

most
entirely by the Federal
government; The city, he * con-'
tinued, has operated on a
caslij
basis and has curtailed its

subject to prior redemption, with
call prices
ranging from 105 to
100 %. Bidder is
required to name

cash taken out

cash.

date

$4,000,000

early sink¬
ing fund payments will be applied
to
assure
their
redemption i by
1958; $750,000 series B, to be re¬

Reserve authorities

latest

series A, to which the

participated in

great triple alliance remains per¬
fect and unanimous.
The people
told

reserves

revenue

ing fund bonds of 1974. The sink¬
ing fund bonds include $750,000

banking system the

will

that

consists

that

never

easily purchase Governments

the Federal

unless

Va.,

bonds, maturing from 1949
1974 incl., and
$2,500,000 sink¬

in the open market to
provide the
increased cash requirements for
reserves and to
put back into the

and it is

war

Commission,

offering

It is not known to what extent

unanimous, and not otherwise
an organization that will

fi¬

serial

by payment of issues held by the
Federal Reserve.

if the great nations

prevent

cash

against these increased private de¬
posits. The Federal Reserve Banks

place where action

be taken

can

the

United Nations is

sent
t*

Nations.

will

citizens, first, that
security against in¬

our

ternational

they

of Peace
-

tell

they have

out the taxes that will bear down

that people

you, makers of public opin¬
ion, reporters of facts throughout
the world, and the rest of us face,

of such securities have been
and are owned, by bank

many

impending

bonds for which
competitive bids
will be opened on
April 30. The

series

owned,

initia¬

trict

deemed

(Continued from page 2225)
lost, and will lose, cash. Moreover,

•

task

enormous

Municipal

Comment

tive.

confused.

are

that

seem

government in 1787, and get away
with it, or take your chance on

tion

individually,

took

sels

safety

West,

government, as the
ffceir chances on

the

nancing is the issue of $6,500,000
Hampton Roads Sanitation Dis¬

make up that great union
group.
I pray God
that, before I go

hard choice perhaps, but
choice.
Take your

new

for the improvement of the rela¬

and the
welfare and happiness individual¬
ly, of all those human units that

;

Among recent additions

cooperative

calendar

the

an¬

...

not for

tions, the improvement of the
status, the growth individually,

destruc¬

some respect

joining to¬
scheme,
aggression—for defense, if
it has to be, but, in the interim,

by a calamitistic attack by
nation, assuming that it is

some

and

reason

advantages

gether

and take their

—

the majority
welfare; or the

dous

people

common

feel that they are not able to
join,
and who obviously are not able to
join, then, for God's sake, let us
make it a juncture with such peo¬
ples as will join.
Let us demonstrate the tremen¬

with representatives of the other

.needn't

a majority of the Ameri¬
people think through their
problem-and decide that they are
making a choice between sitting
in a
Parliament of the World,

country

the

unless

can

What have you got? You have
got,, a world today that depends
upon the exercise of power, crass
power. Do the people realize this?

2251

was

consequence

was

BONDS

■F. W.-

time".

the vital role played by the
city
duringv the. recent war,, Mr.

Craigie noted,

MUNICIPAL

paid for al¬

CRAIGIE&CO.
RICHMOND, VIRGINIA
Bell System Teletype:

RH 83 & 84

Telephone 3-9137

-Inflation Control
(Continued from page
,

Price Control?

the probable date when

estimate

2224)

of reasonable balance
none
constructively by Govern- will exist. Shortly after V-J Day
,the
WPB
stated
that nylon hosiery
iaeiit and business to control in¬

Nauonal Chamber on wnai can

that we

tuness

exist

abundance

matter of common sense Thanksgiving Day or-at least by
last Christmas.
Yet one respon¬
cannot control something

xt is

type

any

would

itiation.

Thursday, April 25, 1946

THE COMMERCIAL & FINANCIAL CHRONICLE

,2252

know what that some¬

manufacturer

sible

states

that at

told

at the present rate of
income, if New York City
had double the hotel space which
it now has, every room would
still
fill
up,
providing people
could get in and out of New York
City. Are we going to keep price
control until New York City can
double its hotel capacity?
Is that
what we mean by saying price

across

price increases.

increases have been secured sirice

that

national

the board up to the levels

it to prove that the indicated wage
increases could be made without
Some of the same Government

V-J

wrote this docu¬

that

economists who

"advised" the General Mo¬

ment

established where these

already

Thus, it is inevitable
rates of nearly all

Day.
wage

be increased in

will

workers

re¬

which tailing, wholesaling, service, and
recommended a huge wage in¬ manufacturing, by about 15% to
crease.
But the numerous price 20%.
Nothing less than this will
acceptable.
By
December,
increases, grudgingly granted since be
then and the Executive Order of 1945, straight-time hourly factory
Feb. 14, 1946, are a frank admis¬ wage rates were 54% above the
sion that the Government's econ¬ 1939 figure and since then have

tors

board,

fact-finding

By infla¬ the production rate of this month,
1946, it will take a full
tion
we
mean for present pur¬ April,
increased still further. Meantime
year's production to merely fill control should continue until sup¬ omists were in grievous error.
poses those upward pressures on
But to repeat, the damage was the fiction is maintained that the
the pipe lines from manufacturer ply catches up with demand?
costs
and on prices which ari§e
Executive Order may involve a
The facts seem to be that in done.
inevitably out of the monetary to consumer and- that normal con¬
But this was not enough.
The "slight bulge" in the price line,
aiiu
other
distortions
brought ditions under artificial price con¬ terms of the present level of
trols will not
exist until some earnings, we are woefully short of Department of Commerce, set up but only a slight bulge which
about throughout our whole econ¬
later will be straightened out.
time in 1948!
productive capital and equipment to help business with authentic
omy by our unparalleled war ac¬
Senator Lucas, a long-standing
We must frankly raise the ques¬ in textiles, in many lines of ma¬ figures and data, also prepared a
tivities and by certain develop¬
and how it acts.

thing is

Day.
and no one group

ments since V-J
i\o

one

man

the information or
tne
mental power to grasp all
tnese manifold distortions.
Hence
of

have

men

tney cannot grasp the manifold
readjustments necessary to restore
the operations of our competitive
economy based on consumer choice
expressed through a relatively

will not be repeated with
equal intensity a year from now,
and again a
second year from
then. The foregoing facts are cited
merely to demonstrate that we do
not appear to be progressing to¬
year

knowledge and capacity to regu¬
late in detail the business and

American

buying activities of the

people running to several hundred
million daily transactions.
Any
temptation to do so must be firm¬
ly put aside.
The objective of the Govern¬
ment, then, is to facilitate the
reconversion, not to blueprint it.

reconversion

the

guiding

purpose
should be to
state and to carry through policies

primary
which

will

inflation

control

maintain productive
What

are

costs

•

and

employment.

the upward pressures

and

prices

which must

be controlled if inflation is to

what

And

controlled?

part

be
can

OPA play in their control?

the

policy of decontrol,
clearly understood timing.

with

Directors

controls

recommends
with

policies

the

that

price

exception

I should like to introduce for the
ment

entitled,

official

our

policy state¬
Board of Directors,

"Price

Control

De¬

control?"
Decontrol

Progress?

widely

commodity after
commodity which he needs in his
business for production or for sale.
Suppliers cite hundreds of such
cases in explanation to their buy¬
ers
for
the delay in delivery.
cite shortages of

Hundreds of items are out of pro¬
because

duction

of raw material or component
parts. Certain foods are exceed¬
ingly scarce because of the way
price controls are administered.
Ohus at present butter is relatively
scarcer than table cream and ice¬
Specific ceilings on feeds

cream.

beef may cause shortages
meats relative to other food.

and
of

this

testimony

businessmen

30%
Now

are

informed that these

and

farmers.

the

Yet

allegations and insists that

these

production
the

and

employment are
According

to
Federal Reserve System's in¬

all-time

most

denies

OPA

highs.

physical production the
output is nearly 50% above
1939
rate.
Employment is
of

the

nearly 20% above the 1939 figure.

Indeed, in every month since V-J
Day we have had more

than "full

employment" as usually defined,
after allowing for strikes and lay¬
offs induced by strikes. Our labor
force
appears
to be relatively
fully occupied.
is

our

conclusion, therefore,

tal

ceiling prices would
by June, 1946,
remaining
under
control.

universal

almost

the

70%

of the

ceiling

ages

that the OPA, while

decontrolled

low

some cases workers
must be laid off because of short¬

prices.

The OPA, eight months ago, let
it be known that in its view about
be

production

minate extent,

retarding to¬

some

indeter¬

has been primarily

responsible for distorting produc¬
These distortions leading to

tion.

of many
reversed.
Indeed, some Govern¬ essential goods and components
ment
officials have voiced
the give the appearance of creating
opinion that there is no prospect underproduction when as a matter
figures probably will be almost

pronounced

scarcities

Continuing?

(1) The enormous deferred de¬
need no further spelling

mands
out.

(2) Our wage policy both dur¬
ing the war and since war's end
has been inflationary in the ex¬
Perhaps never in history

treme.

government's economic
advisor's
been
so
grievously in
error as were those of the present
Administration before V-J Day.
have

and

ument

leased

by the Secretary of Com¬

They could see nothing but col¬

the

purchasing

raising

power,

manship, we are likely to continue
to be led into
more
and more

people are

pleasant predicament of
having to learn to live 50% better
than they ever have lived before."
Although it was not intended to,
this statement has been widely
the

to mean that wages
raised 50%, and this

interpreted
be

must

helped to set the stage for sub¬
sequent extreme wage demands.
It is difficult to see how Govern¬
bureaus

ment

without

future

judging
it is

tions
and

the

forces

and

yet

for the
weighing
and

can

plan

prospective
which

will

factors
operate;

clear that such projec¬
only raise false hopes

into trouble.
Mobilization
Reconversion also prepared a
get

The Office of War
and

not, in and of itself, pur¬

chasing power.
If it were we
merely have the mail man

bring

bundle of daily pur¬

chasing power.
This bit of history is recounted
order

blame

someone

Rather, its pur¬

impasse.

is to make it clear that, un¬
less we can secure a higher order
of economic insight and
states¬
pose

chaos.

economic

Unless

can

less complete re¬
placement of the relatively small
get

Government

number

advisers

responsible for this irretrievable
damage to the American economy,
we are not likely to have an Ad¬
ministration properly advised as
to how to

get out from under price

control.
the

first

made

their

When

boards

members
in

men

still

the

those of wartime.
New controls
have been inaugurated since V-J
Day.
A number of thoughtful

businessmen and
executives
of
trade associations have stated that

specific shortages under the pres¬
ent price ceilings will not dis¬
appear for several years. A man¬
ufacturer of floor coverings
pre¬
dicted last summer that it would
take about five months to fill his

pipe lines through to the ultimate
retailers

that

normal

business

operations would be possible. Re¬
cently he stated that scarcely a

yard of inventory has been ac¬
cumulated, the demand being so
intense that

now

refuses

Act

for

overtime

under

rigidly

unquestion¬
ably have the effect of reducing
the
effective labor supply—the

controlled OPA prices

number

hours

worked

per

week.
The national income appears

to
running at a figure of approx¬
imately
$160
billion
annually.
Even allowing for price increases
this constitutes perhaps a quarter

or a

war

third increase above the pre¬
level.
Yet, and this point I

cannot,

entirety

bringing

will

about

toward

inflation,

under

the

boards

the

delusion

the

and key
were

that our

problem was deflation.
So they recommended 15 to 20%
wage rate increases.
Even if this
diagnosis of impending deflation
had been correct, which it was

transition

not,

the theory of raising wages
deflation
is
threatending

when
was

to me it will be extreme¬

ly difficult to keep the economy
of this country from running
the

convinced

question of

beyond
doubt that if

the measure should become the

Wages constitute approximately
70% of all costs in our economy.
To

argue

creased

that wages can be in¬
a
relatively brief pe¬

riod by 15 to

20%

across

the board

(on top of wartime straight-time
increases of 15 to 20%)
price effects except a

hourly

without any

slight bulge, later to be corrected,
borders on the irresponsible.
In
unimportant

matters

the

people

be misled without serious con¬

can

come

when

But

sequences.

the

facts

about

known

this

wage-price situation in the months
ahead the American people will
be confronted with price increases
closely corresponding to the cur¬
rent
wage
increases.
Yet they
led

believe

other¬

have

been

wise

by their Government.

Not

only do we have monetary infla¬

tion;
a

have wage inflation and
or delayed price in¬

frustrated

thoroughly tried in the 1930s

We have already been

labor

numerous

the

current

round

informed
that

leaders

wage

in¬

first instal¬
ment.
On April 16, 15 railway
unions whose members recently
is

creases

received

merely

cents

increase started
an

hour

pay

proceedings to get

additional raise of 14 cents an

hour.§

By readily permitting wage in¬
do

"which

creases

not

require

price increases," the Administra¬

taken too narrow a view
price-and-cost-making proc¬
Every wage increase, even

tion has

of the
ess.

when

does

not

necessitate

price increase, stimulates upward

price pulls and the black market
under current conditions, because
of the increased buying power
it places in the hands of
the public.
Some wage readjust¬
ments at war's end were inevi¬

which

table, but they should occur pri¬
marily where employers find them
ument purported to prove under could get, which frequently, in necessary to recruit an adequate
labor supply.
"; v
varying assumptions that straight- practice meant tying up a comThe
quality
deterioration in
p&i¥y, a whole industry, or^-a
time hourly wage
fcould be whole community, by means of a some commodities is a direct re¬
incfl&ied
frrlce'.
paralyzing strike and mass picket¬ sult of the whipsawing between
the upward pressure of costs and
effecfeT This docujiientrwas nqyeit? ing where necessary.
The Executive Order of Feb. wages and the downward pres¬
pui>fi^(ied, jbut
14, 1946, states that it is the Ad¬ sure of OPA ceilings. Under rent
somei
too
must
ministration's wage policy to en¬ control the landlord
with4 ? non k government
econo¬
courage
general wage increases Watch his pennies and dollars, and
this explains why tenants during
mists, the Government economists
themselves decided that the docu¬
flmmediately after the settle¬ the cold of winter - frequently
ment was too vulnerable to war¬ ment of the General Motors strike, complain of the lack of heat, the
the Secretary of the Department
rant its;publication. Butthe dam¬
^Congressional
Record,
April
of Commerce publicly recognized
age
was
done.
Labor
unions,
this .document to have been in 5, 1946, p. 3244. ££• ■ ^%-•:
SNew York "Times," April 16;
quoted it extensively; and
error. (New, York "Times," x.lsrch

States

oufc^^Aftey

chfiij&'Otfi "leakSi
ieateid sessions

overemphasize, our basic
capital equipment in
the aggregate was designed in the
prewar to produce a national in¬
come
under $100 billion.
I am the last month continued to quote

productive

its

fact-finding
reports,

Administration

•

actually exceed

the

flation.

(mimeographed) enti¬ with such adverse results that
tled, Facts Relating to Wage-Price one
might
have
expected
a
in the months—and perhaps even of fact, to a substantial extent,
Policy (OWMR-502), which was sounder
description.
years—ahead, of getting out from correcting all pronounced short¬ designed to show in detail just
under control.
Under strenuous ages in commodity after commod¬
Again we must say, the damage
how much loss of take-home pay
Before it was discov¬
pressure the OPA has suspended ity would involve diverting men would result from each of several was done.
and machines from things now
ered that our postwar problem
a number of price ceilings, chiefly
factors and that wages could be
during the period when debate in produced, so that correcting short¬ raised by about one-fourth with¬ was inflation rather than defla¬
ages in
one sector is likely to
Congress was hottest.
out the necessity of any price in¬ tion, numerous substantial wage
create shortages elsewhere.
increases had been inspired, rec¬
According
to
the
announce¬
creases!
It was further argued
ments of numerous regional OPA
Moreover,
rising wage - rates that
wartime
efficiency
gains ommended,' ot - ordered. : Wage
controls were virtually abolished
administrators the black market coupled with the penalty time- made
wage
increases
possible
and the unions were urged by the
is on the increase.
Shortages in and-one-half wage requirements
without price increases. The doc¬ Government to see what they
innumerable lines
under the Fair Labor Standards
document

In view of what this bill

tion.

though purchasing power were
something apart from production.
Money is a medium of exchange

expensive to put men on the pay¬

stated: "The American

bill

this

law

solutely useless and futile for
the Congress to attempt to con¬
tinue any control over anything
from this time on.$

our

57),

the

become

law of the land it would be ab¬

for

page

President,

land,
it would constitute, in
my humble opinion, a most ex¬
traordinary measure of infla¬

Furthermore, Government ad¬
ministrators continuously harped

higher wages as though by mark¬
ing up wage rates deflation could
be prevented.
Surely we cannot
create jobs by
making it more

Report,

Mr.

should

ments.

(Third

These are his words:

wages.

wild.

not

sion

propo¬

minimum

respect

greatly increased without any one
having to pay for the treat. Labor
took full advantage of both docu¬

could

1945, the Office of
War Mobilization and Reconver¬

new

seems

—it

April

got abroad that profits were fabu¬
lous, corporation treasuries were
swollen and that wages could be

at
war's end,
therefore
promptly after V-J Day a number'
taken to counteract
the
imagined deflationary pres¬
sures.
Wage controls, therefore,
were virtually abolished; Admin¬
istration leaders urged higher and

July

with

sals

published. Again,
damage was done.f The notion

lapse

philosophy,

Administration's

the

still has not

although it

of steps were

roll.

liberal

officially

been

Pressures

Inflationary

study

price increases. This doc¬
was
"inadvertently" re¬

out any

merce,

Are

was a

situation

automobile

the

purported to prove that the wage
rates in the motor car industry
could be increased by 25% with¬

price control, many wants
remain unsatisfied for years

Why

said that he would have to oppose

This

(Oct. 25, 1945).
of

expressed

price controls are retarding
production. Nearly every manu¬
facturer and distributor is able to

dex

the

ing

Economic

mestic

ahead.

that

rate of

by Oct. 31 of
that rent control
be
eliminated by March 31
of
next
year.
At this point,
Mr.
Chairman, with your permission,
and

view

The

rent be eliminated

record

in vogue.

now

Capital and Labor Shortages

this

year

enormous

ment

The National Chamber's Board of

people with their high
together
with
liquid savings are mak¬

supporter of the Administration's

creases" document entitled,

incomes

ward decontrol under the Govern¬

All

The part OPA should play is to
free the
market of
control by

adopting

hourly

may

impossible, therefore, for
Government to blueprint the re¬
conversion.
There does not and
cannot exist the
administrative

American

in¬

"Do¬
Developments"

price

without

"wage-lifting

chinery, housefurnishings, motor
car
manufacturing, and so on,
commodity after commodity. The

demand upon the American
economy which appears to exceed
that of wartime.
Price control,

extend the OPA for one more

market.

free

whether the current request

tion

until]

16, 1946, p. 1.)

1946.

yolume, T63*" Number 4484

THE COMMERCIAL &
FINANCIAL CHRONICLE

0
about

undermaintenance, and the dilapi¬
dated condition of their shelters.

Ih snort, price control if it is rigid
and

ments

uefiance

cost

move¬

forces protective reactions

and shows why price control
out

control

quality

toecome

with¬
likely to

shambles.

increase uncertainty.
Politi¬
cally determined prices and wages
uncertain

are

and

prices

wages.

*^'

that

always

ican

its

people and American

ness

would

and

form

ing

the

behavior

added

and

because

Government

of¬

$102

billion

which

does

pockets

in
not

the

one

fore

some

$160 billiorTor

tional

nearly
means

(3) Not only is our wage policy
the same must be
said of our fiscal policy.
Our
methods of war financing, con¬

up prices more fiercely, or they
will want to invest them in real

goods and thus bid

$36
in

has

Treasury

The

rate.

boasted of the low interest rates
it is paying on Government bor¬
rowing.
The true story of war
finance cannot be written, how¬

until all the evidence is m
years ahead. The low in¬
terest rate has been made pos¬

investing

money, regardless of how fast the

—some

Government

only by means of relying
heavily upon the sale of Govern¬

Government chooses to deal with

bonds

ment

commercial

the

Planks.
As

has

this

result

financing,

in circulation (pocket
increased from about $6
billion in 1939 to nearly $27 bil¬
currency

money)

and

that

have

deposits (check book money—the

ahead

equivalent of currency) increased

ations

$27 billion in 1939 to over

This consti¬

$76 billion in 1946.

increase in money from

$33 billion in 1939 to $102 billion
in 1946.** The American people
and business have upward of $225

billion of liquid assets, of which

$145 billion are held by in¬
dividuals.
With the artificially

over

low interest rates earned by some
of these assets,

it cannot be ex¬

pected that people will want to
hold all these assets if a prefer¬
for expenditure

ence

that

the

develops

better opportunity for invest¬

ment materializes. In other words,

the

several

this

This

since

that

Treasury balance,

ment may be vulnerable and un¬

large

remains
to
be seen
whether our methods of war fi¬

steadily reduced to make

have been a

nancing

miracle

mirage.

In 1939 our national income was

about $71 billion; our money stip-

Some such

ply about $33 billion.

and
persisted

relation between money
tional

income

many

decades.

to have

over

money

has

That is,
the

for

each $2

national income.
war

years

na¬

for

tend

about $1

Now if this

relationship between

pre¬

money

and national income should tend
to

reestablished

natural

economic forces, our national in¬
come

in dollars would tend to be

two

about

billion,

which

three

times
our

$102

present

but

deficit

these

the

now

largely

ing

were

new

the

**In addition time

deposits

rose

$49 billion in 1946; savings bonds
carrying such a low rate of in¬

dollar
sible

expands

evitable that many

concerns

in¬
will

be forced to borrow

*"*-41;.

sold

promptly
orderly fashion.

but

these

that

ail

many

controls

pro¬

ment

he pressure groups

vou

trouble

factor.

respon¬

than

in favor of

program which abol¬

of upward

causes

would

get

solution to

would

restore

the

problem and

free

price

society.

This

analysis, if it makes any¬
thing clear, demonstrates beyond
dispute that price control fails to
wrestle with the
tion.
way

money

are

causes

intervenes.
can

liquid

the

savings

bottom

the

which
infla¬

tionary

pressures.
Nor will price
control prevent a further increase
in the supply of money.
Nor does

effective, people's
ish

the

and

money goes tMt
It does not dimin¬

disposition

the

decline

rise
of

to ! spend... as

interest

Then, and only then,

function

you

without

the

undue

public

pressure

program involving prices, wages,
fiscal policy, foreign lending and
all other factors that bear on our

does

between

sup¬

the

amounts of travel and

Congress

respect to the contin¬
uation of OPA controls, the results

year

hence will

tory to large sectors of

unsatisfac¬

asiearly^as
September, 1944, in "Iriflftion'3Sar*

our

society.

Congress on the spot. Whatever
changes you people make, it is
likely that you will get the blame

The Postwar."

The

coer¬

buy

The market may never
operate

F. W. Home in Portland»
(Special to The Financial

Chronicle)

PORTLAND, MAINE
Horne

Co. is

—

engaging in the

securities business from offices lift
the Bank of Commerce Building-

Partners of the firm
Horne
Both

and

Frank W*

Deming*
business'

formerly

were

under

are

Edward

the

in
firm

same

ift

name

Hartford, Conn.

New York Stock Exchange

Weekly Firm Changes
to act

the

John

alternate

Flannery

the floor of

Exchange for John E. Barrett

of Barrett &

Co.,

was

withdrawn

April 19.
Alfred
in

ner

comes

Levinger, general part¬

Seasongood

Haas,

be-1

limited partner effective

May 1.

unsatisfactory results un¬
price control which appear

der

Henry Cabell, Jr., Dead

inevitable.
The OPA takes

pride in the fact

that three out of four people ap¬
pear

to favor continued controls.

Yet

one

there

wonder

may

should

tion at such

be
a

much

vote

whether

gratifica¬

since it may

be doubted that it is in any sense
the expression of an informed or

group, because the answers to such
a

Landon

Henry

Cabell,

Jr.,

President of the Richmond Stock

Exchange and

Cabell & Co.,

died at his home of

partner in Branch, i

heart attack.

Mr. Cabell, who J

42 years of age at his death,.

was

began his business
old

Planters

with the

career

National

of'

Bank

Richmond; he became associated;
with

question must be governed by
feelings of housewives and

Branch, Cabell & Co. in 1922..

the

trade, the sibility as members of a coopera¬
indulgence tive productive organization.

OPA

impartial at|d

compulsion and

for the

in recreation and amusement. Ob¬

does.

supply of and the
goods and services*

cion. The consumer is free to
or not to buy.

The OPA through its propaganda
has put this Committee and the

U, S. A., July, 1945.

set forth

minimizes

Privilege

what

with

in spending others who are conscious almost
savings since exclusively of their function as
the unparal¬ consumers but not of their respon¬

the end of the war,
leled volume of retail

the

for

The free market is

and to allow

if diminish the desire of people to thoughtful economic opinion.
spend, but the contrary, sinc&.to Rather, it is the evidence of the
the; extent that price contrplf is existence
of
another
pressure

ftiuch further.

A govern¬

price-

from the people.
We commend to you an imme¬
diate investigation of what would
be a coordinated overall decontrol

infla¬

It does not operate in any
to reduce
the
supply of

and the
hostile

into

in the entire

lic interest is to reduce the num¬
ber of areas in which Government

any

Abandoning

demand

Regardless

history

driven

opposing camps).

terests

responsible members of
the Senate to function in the
pub¬

symptom treatments by the OPA

real

the

process and

causes

probably

were

perfectly. It may at times cause
hardship, but it is the form of
process, the more the economic society which the Amerpeople will be forced to organize ican people, given a chance
to
themselves into groups to protect understand
it, actually desire.
themselves. The way to mitigate

are

everywhere.

(in spite of which the Ger¬
suffered its great¬

economy

loosely knit to¬
gether by the free market through
which they may express their in¬

before.

never

intervenes

before

economic

actually
So long as this

recognized

years

can be used too
long*
The society of man is at its best
when people are

flourishing

are

five

into

collapse

and

deeply the Govern¬

making

these

sectors

Washington

But the

reasons

groups

1928,

came

come
man

Numerous people have said that
pressure

Subsidies

ment crutch

Furthermore, if we place the
In fact, the viously it does not increase the
beginning of economic literacy
view that
inflationary forces would supply of goods; no advocate of and awareness of economic
prin¬
outweigh deflationary forces after price control even
suggests that it ciples and events at the age of
the war was

Commerce

suppressed

desire

power, German
public authorities were in control
of over 50% of the national in¬

Chamber

hat

Hitler

people

mium

holding them to matur¬
ity increased to $48 billion; many
people view these as highly liquid
savings to be spent as soon as
goods are available or better in¬
vestment opportunities open up.

his

Government surplus commodities

terest that there Is not much pre¬
on

loses

price control is not merely an
economic question.
'
.J1
We need to remind ourselves

evitable.

suosKues

single

shown

tfNor is this criticism of Ad¬

ministration policy based on hind¬
sight.
See:
"Maintaining Pur¬
chasing Power in the Transition,"

man

Numerous readjustments are in¬
The Government should
try to direct them along natural

oil

for labor

other

pres¬

involved.

business

est

arbitrary redis¬ current imbalance
tribution of wealth and
income; ply and demand.
the instability of the value of the

com¬

funds, which
money supply.
This would mean Mlp. Jsreate additional purchasing
power, this making it all the more
a national income of $200 to $30#
urgent that Government fiscal
billion, in contrast to a figure of operitions work in the
direction

from about $27 billion in 1939 to

are

Inflation

the

financ¬

man

considerable period of time,

ing must be geared into our own
supply and demand conditions.

The evil consequences of infla¬
tion

becoming purchasing power
making a demand on Amer¬
ican industry for goods and ser¬
vices,
directly
and
indirectly.
no

farm

Conclusions

and

though

for

banking
Foreign lend¬

possible.

should

economic myopia afflicts our price

even

control policies they muse fail.

modities and other services there¬

sure

for

being intensified.

these dollars will be used to meet

inflationary

trie economy

huge Treasury surplus bal¬
is virtually zero, but steadily

further

all

prices and hence

evidence that

of this

his

subsidy

symptoms of inflation, and that
explains why instead of progress¬
ing toward decontrol there is clear

pressures

This is

concentrating exand price
controls has been dealing with the

ishes the

buy

inflation.

entire fiscal and inter¬

our

system

year.

present the velocity of circulation

payrolls,

subsidize

practically

The OPA

revenue, the activation
billions of dollars now

Government

American

must

believe

Treasury will provide
powerful inflationary factor.
To
put the matter another way, at

ance

the

themselves.

iusively

only
will be
up

nis

not

idle,

price

dividuality of

and

and hold Government
bonds and
to remove as
many of these bonds
out of the
commercial

dis¬

minated not later than October of

will not

assumed

also

wartime subsidies should be ter¬

years

expenditures,

the fiscal situation of the Govern¬

stable.

that

Since it is assumed by the fore¬
going arguments of the Adminis¬

and

maintaining

has

Such

bill.

also distort

part inactive

revenues

inflation

policy with a view to encour¬
aging the demonetization of our
debt, encouraging people to buy

anything in peacetime
and yet we continue to

duction.

however, the
fact that (1) refunding may ai
volve bank borrowing and +ha
(2) the Treasury balance of about
$25 billion is now for the most

Government

Today

markets

connection.

tration that tax

sider

effect creates that much additional

overlooks,

equal

inflation,

money

wage

est

excessive money to spend in other
markets if not in the subsidized

the

except for refunding oper¬

de¬

have

these controls? Habit is a power¬
ful force. Once the mind and in¬

reason¬

and thereby, at
least
potentially, is inflationary in this lines so that
gradually we will
respect.
Furthermore, by de¬ have an effectively
functioning
pressing prices it makes the con¬ free
economy with high-level em¬
sumer's dollar go further and in
ployment at good wages.

because of large Treasury
balances; therefore it is claimed
that inflationary pressures through
the Treasury will not be substan¬
tial

not

We
have

The OPA appears to

opposite line of

frustrated

Treasury

will not
substantial

any

the

groups and business groups.
increases the deficit in the U.

Treasury

resort

appeared.

opposed

budget will be short of
balance by only a few billion dol¬
lars in the fiscal year of 1947,

Demand borrowing

lion by the end of 1945.

tutes

argued

subsidies

grocery

Federal

from

been

for

reason

insist that

symptoms instead of causes.ff
It

ing.

this

that

increases.

wage

roll-back

history,

claps on ceilings or
closes
loopholes first here and
then there, only so long as the

banks and to the Federal Reserve

further

exceeds

their

ever,

sible

and

wage earner has an income which

let. The American people can be
expected to continue to find ways

spending

What

terms

for selfGovernment will be in the market dynamic
economy, some prices are assertion and
self-expression; he
billions of dollars' worth of always
rising and some are falling. becomes a
prey for further regi¬
goods and services. This may be Instead of
trying to hold a price mentation.
The
general
public
further inflationary pressure.
line with a slight
bulge, the OPA acceptance of price control more
ought to take those steps which than
eight months after V-J Day#
Subsidies
will lead to its own
liquidation.
when it was a free
society for
Demands for the continuation of
But the OPA is
dealing
which
only
we
fought'; the war and
subsidies continue.
During the with the symptoms of
which
inflation;
we
were promised, is evi¬
war
period the system of * roll¬ therefore the Federal
Government dence of a decline
back subsidies
*pf AmCricaf*
was
inaugurated should cut its
expenditures,
sub¬
individuality. The character arid
for the exclusive reason of hold¬
stantially overbalance its budget fibre of a
people are a nation'*
ing the cost-of-living index in and the
Congress should recon¬ greatest asset." The
order that labor would
problem Of

wartime

controls, the inflationary pressures
just move over to some other out¬

This effort to hold wages has now
been abolished and therefore the

financial tion by prohibiting buying on
house in order, ail other policies margin and giving speeches against
will prove ineffective in dealing such
speculation, and is now pro¬
with price controls.
posing to put ceiling prices on
One of the great "miracles
of vacant lots, farm lands, and other
war finance, it is said, has been
real property.
Every time the
the financing of our growing debt Government intervenes with one
by means of a steadily declining of its ceiling devices or other
interest

billion.

real

a free market system,
agricultural' commodities

most

for

estate, securities or in some other
form.
If they try to invest them
tinuing deficits for over a decade in stocks, as many are now doing,
and the "cheap money" policy lie stock
prices will rise and we
at the foundation of our price con¬ Have inflation
there, or they will
trol problems. Even the erroneous invest them in real estate and
wage policy has been conditioned then we have inflation in real
strongly by fiscal policy. Until we property.
Both are happening,
recognize
the
interrelationships and that is why the Government
between all these issues and poli¬ has tried to stop
security specula¬ mand
cies and until we put our

pronounced.

The budget for the fiscal
year
calls
for
expenditures of

1947

some¬

consumer

na¬

to which can be
added billions of liquid assets and

past "savings."

vast

for

income

thing with them. Either they will
spend them in the months ahead

liquid assets will want to do

annually

working of
Irt:;
no

one^ under 35 or 40. has wit*
"supply catches up with demand." nessed with mature
observation 31
Might it not be wiser to abolish truly free market,
j
k
:
all ceilings wherever critical short¬
If price control is continued on
ages occur on the theory that then and
on, is this likely to so condimanpower and other productive
tion the American people to con*
resources would be lured
by the trols, and make them so subserv¬
opportunity for profit and good ient to these
controls, that they
wages into those sectors of the will ever
generate enougn indi¬
economy where shortages are most
viduality and realism to check

finances

consumption providing no
is hoarding income.
There¬

will continue to produce

any

ficials is inevitably unpredictable.

inflationary,

production

own

earn

these

owners

overemphasized

the pending boom and the
high current level of production

de¬

toward natural read¬
justments.
Some ' suggest 'that
price controls be continued until

money—a

demand

so long as it is in the pocke
lying idly in the bank.
In
words, it is altogether likely

that

increased

and which does not aug¬
ment the owner's standard of liv¬

prices depend upon Government
confusion

to hold in

form

return

other

decision

care

the

busi¬

i'2233 iv

reducing Government require¬ economy

ments for funds.
It -cannot
be

Absolute certainty cannot exist in
the
affairs of
man,
but when

uncertainty is

To put the matter another way:
it is not probable that the Amer¬

posits

These events all have combined
n.

$160 billion at present con¬
trolled prices and regimentation.

21, there is
country' under the
or

for the
remaining ,
days of its life ought to guide the has

ever

age

one

in the

of 25 who

Brown & Vogel Director*
CHICAGO, ILL.—At

meeting

('11

the

Board

American

Directors

Potash

Chemical

Corp. held here, Robert F. Brown,
a

partner of Kuhn, Loeb & Co.,

and

Rudolph E. Vogel,
Glore,

elected

Forgan

directors

intelligently observed the existing vacancies

partner

Co.,

were

two

fill

the board.

the

THE

2254

Thursday, April 25,,1946

FINANCIA^hC«RONICLE>

CQlVfMERCIAN

control
four years arcj
the suspen¬ very much worried about the far.*
sion in the first place no longer reaching ill effects of these pro¬
issued or prior to V-J Day, and consumer because most of the
(Continued from page 2224)
exist.
Additional
amendments
Suspension was used in last posals.
items are in distribution channels
tions, etc., that's your privilege. so on. I won't bore you with those
which will be proposed from the
and haven't yet reached the store Monday's actions because of the
All .I ask is that you make sure statistics, except to say that at
floor
of
the
House
and in the
shelves in any quantities and be¬ experimental elements involved.
of your facts before you criticize, least two-thirds of the 16% in¬
Broadly speaxing, Directive 68 Senate would involve substantial
retail since January, cause there are always at least
and re cognize that forcing such crease at
three people just standing around permits decontrol in two cases:, price increases in most consumer
restrictions down the collective 1942, took place before the issu¬
first, under section 1 where prices durable goods, in most foods, auto¬
throats of a normally free econo¬ ance of the hold-the-line order waiting for each item as it leaves
the pipeline and arrives in the re¬ will not rise, and second, under mobiles, clothing, etc.
in May, 1943.
my couldn't be done altogether
terminated and controls reinstated

The OPA's Control Policy

However, the shooting part of
war is over. That fact, coupled
with a general and only natural
antipathy on the part of everyone

pleasantly by anyone.

the

All the top operating jobs in
OPA are held by experienced
businessmen—experienced in the
field in which they are operating.
For the most part, they*re young
businessmen, or were before they
came to QPA, but they have to
be young enough to stand the
pressure and the speed required
of us all. We work long days and
Jong weeks—the government has
been put on a 40-hour week, but
there's never a Saturday that' the

to the war controls that remain in

think

that

very

ply agency concerned—the Civil¬
ian
Production
Administration,
tho U. S. Department pf'Agricul¬

few

persons

seriously propose the end of all

We take our paper price control at this time and,
IwprkIhouie, hat^ long telephone therefore, it should not be neces¬
any weekday.

home in the eve¬

conferences at

ning, eat and drink OPA at the
dinner table and, in short, drive
our

sary

for me to dwell very long

the

reasons

The

control.

families crazy. We're sincere¬

During the war, we all had our
particular jokes about price con¬
trol—we all repeated them but,
nevertheless, we had a profound
conviction that price control was
essential to help us win the war.
The
one of comment, however,
now

vindictive

become

pressures

are

over¬

iti the

ture, etc,
Materials

the

p£ Building

pase

program

coor¬

dinated

by the National Housing
Administration under Wilson WyInasmuch

att.

our

joint

pro¬

supplement each other, we
possibly get away with
being as stiff necked or lethargic
or stupid as some of our accusers
would like you to believe.
The
supply agency involved makes a

grams

couldn't

determination

to essential sup¬

plies, and recommends price in¬
creases
to
help
secure
those
amounts where, in their opinion,
they

the case

agree,
Office
and

If we do not
is referred to the

are necessary.

Stabilization

Economic

we can

be ordered to increase

the prices. That is the function of
that office—to settle disputes be¬

agencies

Government

tween

where stabilization is involved.

Another important

phase of our
This

changes, particularly raw cotton,
the outrageous increases in com¬

current activity is decontrol.

mercial rents and the tremendous

tive

speculation in real estate. Were it
price control, all commodi¬
ties
would be doing
the same

should

is governed by a direc¬

program

OES—Directive

from

68—

which

spells out the standards we
apply.
These standards
are of a general sort, but they are
not definite and precise.
A good

section

where

Section

relates

significant in the cost of
living or business costs and per¬
mits suspension where the Price
Administrator forms a judgment
that the action will not result in
that

are

level

existing ceilings for the

commodity and then permits ex¬
emption after a trial suspension
period if the Administrator is
,

satisfied

the directive

firmness

revision

strict

would spend all of

particular segment of
the food industry, it became ap-

ments of the Stock Market.

parent thai yesponsihle members
of that industry did not realize
that the Department of Agricul¬
ture
with

food

only

The

vanced

precise standards we are forced to
either

two

between

choose

courses—

act cautiously so as
decontrol
one
product

we can

not

principal
argument ad¬
by our critics is that price
is stifling production.
It

lack of

another
equally or more eligible for de¬
control or we can just go ahead
and ignore the unevenness of our
while keeping controls on

however,
with

primary

ing

Obvi¬

mercury.

out now whether we were
in the caS^pf die castings,

wrong

which

have

risenf- sharply

since

suspension.
Section

permits

significantlyyinto the cost of

living

business'costs, (2) con¬

disproportionate to the ef¬

fectiveness of

conifol

presents"

the con¬

stabilization and

tribution to
decontrol

(3)

substantial

diversion of materials,
manpower from pro¬
& the transition

duction essential

would

and

not

impair effective
By

price controls in other areas.
far, the largest

niijhber of decon¬

haver-been

actions

trol

and

will

continue for the tijrjie being to be
under section

taken

rective.

give

2 of the di¬

powers

our

thorough

It is imposible for the public or

else outside OPA to have
familiarity with price

any one

the

same

control
stand

and

problems

under¬

thoroughly all the reason¬

planning, arguing, meetings,oh, which go into the crea¬
policies and the regu-'

ing,
and

decontrol
where all the following tests are
met: (1) the commodity does not
enter

not

tion of our

lations

issued*

amendments

and

I do think'
it is too bad that you and all in-:
terested persons can't sit in on the
meetings, know the people who'
are arguing and
know the back¬
ground well enough to understandtheir reasoning.
;
We can't explain our thinking'
and our reasoning in simple lan-:
under them. However,

guage because we're dealing in
complex economic concepts. Qur
best efforts many times only result
in confusion confounded.
It all'
boils down to the fact that yo.U;
have

confidence

have

Us.

Since the country is too large for

everybody to sit in

on our opera-;

It is

thatysection which is tions, you will have to have faith
open to the widest varieties of in¬
in our knowledge of price control;
has concurrent jurisdiction is another of those general, re¬
administration of decontrol.
To terpretation. Some think we have our sincerity, our desire to be of
us for price control of all sounding, statements which sim¬
commodities, OPA is the ply have no basis in fact. All dur¬ take the former course would not gone too far in decontrol under it service and our intention to finish'
—some
think we||iave not gone the
villain they recognize.
job at the earliest possible mo¬
ing the war, we had price control result in the crazy-quilt appear¬
and it certainly didn't have any ance that so many have accused far enough. Last Monday's actions ment, If you think we're wrong,
control

Attitude of NAM

tTbe

National

Manufacturers
for

and

ously, we were wrong in the case
of fresh citrus fru®"#e are find¬

facilities

Because of the necessary

stantial revision of our standardsj

review,

threat

potatoes,

wines,

aluminum

of it done.

requiring sub¬

mestic

and how to do it—and not get any

issued a
Cotton Margin Regulation, which
requires additional margin for
purchases on the Exchange, some¬
what similar to the new require¬
Stabilization,

decontrol

get rid of the terrific backlog
work. Amendments

cedure, and the Congress would be
doing less, than its duty if it did"

nomic

time talking about

our

this

charged -In

prices gener¬
ally. We have been right almost
every time we have used it—as,
for instance in the cases of do¬
tinued

the numbers of people

guilty

ing to overcome it. We're not the
least bit proud of our past record
in those instances and we'd like to

applying the medicine. Of course;
it's only normal, democratic pro¬

control actions under section

such

constant

often

respect, but we're constantly striv¬

than the usual number of doctors

the suspension will be terminated
and the ceilings reinstated.

changing conditions would require

com¬

pletely justified is in connection
with delay in handling the case
of individual adjustments.
We're

1 of

threaten to rise above that level,

wild.

Last week, we took steps

criticism

where

because of the con¬

that if, dur¬
prices rise
or

culties

only, in¬

that the

found

We've

stance

There have not been many de¬

suspension,

ing

the first to admit that OPA
has not done as good a selling job
as it should have.
I am amazed at

sion with

The

increase.

section also provides

rules that

powers, our legal, limitations* etc,
For example, in a recent discus¬

exemption will not

such

speculation in the cotton
market—on the strength of a di¬
rective from the Office of Eco¬

standards are, our

that

have lived with the price

program for oyer

would so bog us down
industry-wide actions, that I
would despair of any satisfactory
handling
of
individual
cases.
We're going through our annuar
treatment of sulphur and molas¬
ses, but this time we have more

result

control

our

general

trol involves administrative diffi¬

require substantial revision of our
powers and, if false, require imme¬
diate and forceful rebuttal. We're

with the difference being

know what

the

above

increase

thing that is, too, because rapidly

thing

who do not

they may rise.
to commodities

these uncontrolled items,
that in¬
flation would be infinitely more

longer harmless and if true would

among

simple—

not for

quarters—the jokes are no

many

hanging the market is proved by
the substantial and continuing rise
in the stock market, the specula¬
tive activity of commodity ex¬

has

answer

enough goods to
meet the pent-up demand which is
implemented by tremendous con¬
sumer income and $145 billions in
individual savings. That these in¬

normal life.

continuance

there are not yet

ly convinced that OPA is a neces¬
sity and, at the same time, we'd
give most anything to get off the
merry-go-round and get back to
industry and return to something flationary
of

for

by allocations or
channeling orders from the sup¬

higher

yalue to label those
who are seeking to accom¬
plish changes of various kinds.
Although we may question the
motives of some of them,
the
question
remains
"Are
they
right?"
I

have been aided

before.

groups

parked
;as
thick -around the httilding as on

our programs

It is of little

carsarehot

extent,

some

ever

force* has given rise to
tide of Criticism than

tail store.
To

that condi¬

mere finding
tions which justified
upon

some

adverse effect on

Association

has

been

something

result of the "cease fire" or¬

as a

stating

production. Has
happened

miraculous

der to make the same agency

time that price control

sud¬

denly become a deterrent to pro¬
duction?
All evidence points in

should be ended because the in*

dustry is faced with rising costs
This statement
is irresponsible and false and is
amazing in view of the hundreds
of price actions, which cross my
dCsk, practically all involving in¬
creases in price in order to comply
With our earnings standard.
The
earnings standard can be
ex¬
plained briefly, as follows: it is a
policy which requires us ta in*
crease' prices whenever increased

the

and frozen prices.

opposite direction.

Long before V-J Day, we pre¬

pared new standards and tech¬
niques designed to implement im¬
mediate
reconversion.
We put
into effect our reconversion pric¬
ing

program

that

had

for

been

pricing

goods

out of production

during the war. We issued a reg¬
ulation to cover the pricing of new

products,

costs would otherwise

prevent an
industry frpmiearmmg^ returmcm
its current #ei worth equal to that
earned in a representative peacetime period. When we add to ac¬
tions #akenmader^
industry actions to encourage pro-1
duction, .actions taken to relieve:
.

including

self-pricing

for new, small producers of con¬
sumer durable goods. We have is¬
sued since V-J Day over 200

in¬

dustry-wide price increases be¬
yond the minimum required by

giving—also, it would not
suspensions such as
the big list of consumer and in¬
us

result in any

that

materials

dustrial

sus¬

pended last week. Needless to say,
OPA
has
adopted
the
latter
course.
This makes it necessary
for

take

position which,

put bluntly, is: that consumers and
businessmen have
the right to

price ceilings are being
rapidly as possible
(from both the economic and ad¬
ministrative points of view) but
know that

removed

that

individual

has

vested

right to have his product decon¬
trolled at any

particular time.

In the present

period of rapid

transition the essence of the prob¬

I can tell
that we are approaching de¬
control aggressively and with the

lem is one of approach.
you

law for the sole purpose of en¬ purpose of ^ttfng out alfast as is
couraging production of essential consistent with stabilization and
£lems; such as building .material with the knowledge that we ere
scrueezea on: indivjidualiprQ^t^^
taking some risksand tnust con¬
O#efforta&aye paid
;
where over-all earnings are
y~ V
* creased employment mid produc¬ tinue to do so.
satisfactory,
individual
adjust- \ tion in the consumer durables
The question of risk Ibriugs. -up
ments by

the thousands and, -more

recently;decontrol-

hunteds

field

well

in the heavy in¬

the

difference

between the tech¬

were

taken

primarily under that

section, which it { has aided to a
very great extentjin clearing the
decks for active

Sec¬

tion

2(a)—in those special cases
recommendations to
the Office of Ecwiomic Stabiliza¬
tion and the decision as to the
submit

rightness

th&^xongness of the
We

action rests with Mr. Bowles.

don't have

mqglj, occasion to use

this section because there are
a

only

few situations in which we
consider decontrol when Sec¬

very

can

tions 1

2(a) won't fit.

•

of* active decontrol
mater of fact, a liquidation

This period

is, as a
period and will accelerate from
now to June, 1947.
Such a policy
involves taking the chance that
people will have more confidence
in their ability to buy the things

they want in the immediate fu¬
ture; that, the fendnncy
into the. market Woh't tib^s strong
and that the inflation "jitteis" will
diminish rapidly.
•
\

indicate nique of exemptipri and that of
and aoon thousands of. items, it 1
that there has been en increase in suspension. After,a commodity has
should be clear to everyone that1
employment in these industries of beep.^exempted^ve
v such
a
statement about frozen
The hfe-span *>f OPAiiSj iixhe
from 5,0 to 200%—that increase is back under control only by mak¬ :1
K prices is simply pot true. - We
The
evident in practically nil lines, ing nil of the findings which would moment, open to question..
can't help wonder what the real
such things as oil field machinery, be required to put it under con¬ House of Representatives has re¬
reason is for making it.
ceived
from
their
Banking
and
railroad cars, radios, construction trol in the first place. Suspension
j The accomplishments of price machinery, refrigerators, washing of control over a commodity may Currency ^Cofcimittee,; % J3ili:&r
control during the war are a mat¬
machines, machine tools,
files, be for a definite period, as in the the extension of the Emergency
ter of record. We think of that: saws, and soon. The only ppssible case of white potatoes.
In that Price Control Act? for one year.
result is a tremendous improve¬
record in terms of percentages of
However, the Committee h^:^^
case, controls go back into effect
ment in production, in equipment automatically at the end of the
posed three amendments which
increase in the cost of living be¬
used to make consumer goods and period. Suspension also may be would seriously hamper the con¬
fore and after formal price con¬
in the end product; Thatjupsurge for an indefinite period. While a tinuance ;of effective price control
trols were established, before and
is, Apt yet visible to the average suspension is in effect, it may be another year*
after the hold-the-line order was
Those of us who

dustries.

Recent reports

offer at the
Mr.

recently

Bowles

ments of either Section 1

some

#rtce controls in

important fields.
There is a thirdJlsection of Di¬
rective 68, within which fall items
not complying with the require¬
other

all means say so—but have'
constructive suggestions to
same time.

stated

in'

article "Forecast for America"

that
to

have every reason to

economic

our

look
with

future

optimism because, "Today we are
a

whole lot stronger and a

lot smarter than

the

war.

...

whole
before,

were

We have our troubles

today.

But let's

not get panicky

about

problems

This

the

and

solving.

threshold

period of

greatest

peace-

prosperity we've ever known.
use

age

■

strength and cqur-l

showed in war,

stop us"

can

reasonable,

even

amount of the

...

are

country is on the

nothing,

.—————

Trans Caribbean Air

■

-'iV.

Newburger i& Hano, ahd KoJ^ie;
Gearhart & Cbv, Inc., m>ade a

pub~

bff I

lie Offering today XApril 25)
99,000 shares {pax
tal

lOoeuts)* c^pi-

^tock pf

Gargo

lines, Inc.,

Proceeds from

the .sale

sharpy j
will he J

used by the company to purchase
additional planes
with the balance

andEquipment; J
.slated to become j

additional working papxt&l.

Three

planes are now. in operation,

A*.

2255

Debt and
(Continued

2215)

irom page

•ury has taken into account all of
'the Government's

taxes

and

other

receipts

from

rela¬

sources

-that have been authorized by

Con-

gress.

If there

are not enough funds
from
receipts, money

available

)must

be borrowed b,y the Treas¬
ury to augment its cash balance

that

the

[[can be paid

expenditure

they

are

checks

presented.!

Under the

circumstance?, the pub-i
;lie debt must, of necessity, go up;

'4 If,

the other hand, there

•the

.able to take

.'and
<

to meet
authorized by

some

is
surplus

the

public

debt

will

Debt Determined by Congress
In the final
it

able

securities

demand.

securities

re¬

were

the

not

were

redeem¬

Some

of these

transferable in the

were

market, but were restricted as to
bank ownership-for a. period of
More than half of the total
increase in the public debt that;

should

that

the

debt

analysis, therefore,
clearly understood

amount

determined

[4. and is the end

the

public

Congress

result at the Treas¬

ditional

ing

planning

was

ning too; and there is
securities

the

prices

the

that

occurred

day than it otherwise would have
been; neither is it a penny lower.
;

•

Not

Opposed

This does not

and

out

I've

classes.

been in

Treasury—that a
good thing to have.

existence

requires

the

offi¬

cials of the Treasury to come to
the Congress from time to time,

[

Accordingly,

.structure

going

are

on, and to set
Congressional com¬

before

mittees

the

detail

debt picture.

the

public

opinion, the

preview of the situation that

re¬

sults is beneficial.
i.

ment

| is only that the limit
not reduce the

|.limit

should

fhat it will

in itself does

debt, and that the
be

not

remove

set

low

from the Treas¬

Before Ido so, however,
I should like to make a few com¬

ments

the

subject

of public
Debt manage¬

debt management.

ment is

subject that many peo¬
ple are just beginning to think
about, but it is a subject that the
a

Treasury

has

been

doing

! tiling about since the
I ning of the war. ' *

some-

until
I

the

debt

has

grown

occasion

| tually incurred,

*•

* >

;

ae^
e

Distribution of Debt

I -At the outset, for example, it

Jwas

decided

that

the

the
our

securities

and

Federal

within

after
the

ten

The

years;

debt

held

amount

the

classes of investors and the

position

holdings will,
shift with the passage

naturally,
time

and

acter of
that

com¬

their

the

changing

char¬

economy. This means
debt will
have to be

our

the

tailored to meet these shifting de¬
mands.
This is part of the policy
of flexible debt management.

have

because I want to
that
the
Treasury

clear

the

into these matters

detail

some

planned
of

gone

country.

gations would have
markets.

the
tion

the

entire

effected

cash

holdings. In fact, the reports
leading commercial banks and

outlook

before

sion of

our

the

debt

payoff

excess

<Vf}

Bank

i'.'

■

Holdings Down

~j1r*

|y>

result

the

application to debt

repayment of a part of the cash
balance that was left over frpm
the

Wictor^ Loan, Bince thatLoan1

closed,

various spld

the

any

Government

has

not

securities to the public

This meant that they; been on continuous sale
fop oven
should have the particular
types ten years, and Savings;5 Notes
of securities that would best suit
which are used primarily as tax
them and that they should have
anticipation

instruments).

value)—

451,317,000

500,157,956
37,545,296,200
49,114,483,000

indebtedness

bills

Treasury

17,047,223,000

403,707,002,200
Total

interest-bearing

285,299,033,206
238,299,056

„•__

Matured, interest-ceased

Bearing
War

interest:

Savings

Excess

Stamps

H2,335,135

profits tax refund bonds

109,154,539

221,489,674

—

285,758,821,936
Guaranteed

obligations (not held by Treasury);
Interest-bearing:
Debentures:, PHA
Demand

CCC

501,322,322

541,709,259
11,366,475

interest-ceased—.

553,075,733
Grand

total

outstanding

286,311,897,669
'

Balance

face

amount

obligations issuable

under

above

authority—

RECONCILEMENT WITH STATEMENT OF THE PUBLIC DEBT—MARCH 31,
(Daily Statement of the United States Treasury, April 1, 1946)

.»

;

":-.v

1946

Total

gross public debt
Guaranteed obligations not owned by

Total

gross

Add—unearned

not

public debt and

discount

between

value)

maturity

$276,012,418,847
553,075,733

the Treasury

guaranteed obligations

Savings

value

;

$276,565,494,580

Bonds

and " current

$10,730,071,856

—...—

outstanding public debt
debt limitation^

subject

i
;x

Outstanding March 31, 1946:

obligations

•-'

•»

••■

983,668,767
.

9,746,403,089

$286,311,897,669

reached

.',

—

13,688,102,331
'4'

Deduct—other

possible, and more rapidly
than originally expected.
The ex¬
penditures
of
the
Government

40,386,936

obligations:

picture, the Government has been jgUw,
reducing its expenditures as rap¬
i*1' !f; "
idly

"59,463,150,700

notes

Certificates

redemption

expenditure side of the

$300,000,000,000

amended:

>V.'»....,

$181,592,031,006
Treasury

Expenditures Reduced
On the

...4;

time

$121,177,405,350

Savings (maturity
Depositary
Adjusted Service

(difference

"Approximate face or maturity value; current redemption value $48,733,078,843.

high of $9,700,000,000
By March of this year,
they had fallen to under $4,000,a

and 1947—copy of five-page
survey—$3.00—clip advertisement
in this issue and send
with check to Department C-F,
year

last June.

elsewhere

000,000, and the decrease is con¬
tinuing, so that average monthly
expenditures

the

fiscal

American

year

.137

1947 will be quite a bit lower than
the March level.

Institute

Newbury

Street,

Finance^

Boston

16,

Mass.

As the President announced ten

days ago, we
of

are

well

"It is the aim of

fiscal

our

pol¬

icy," the President said, "to bal¬
ance
the budget for 1947 and to
national

debt

these.

boom

our

pres¬

ent

which

is ;to

ing tax

maintain

the

exist¬

striictiir§ •for the present,

and to avoid nonessential expen¬

ditures; ;is; the best: fiscal contri¬
bution

stability."
;;;

The

can

''1

reason

make to economic

':7:[':
I

have

' v 4
discussed

these matters In detail today is
that I want to make a particular
point to you; that is, the Govern¬

ment's

vt.

Ed. R. Parker Go. Offers

the way

balanced budget because
we have made to¬

the strides

fiscal

outlook

good

classes of investors: should be sold in ordeM^Jaisenevy money
(ex-f this time, its debt is in good shape,
securities which fitted .their re¬
cept Savings Bonds which have and we are managing it well,
quirements;

Treasury

economy

fight against inflation, fiscal
Government securi¬ policy has a vital role to play. A
of the total debt re-*' continuation of our
present policy,

duction since the end of last
year.

one

Bonds—

reconver¬

from war to
peace was more rapid than even
our most
optimistic hopes.

times such

April

combined reduction in

Outstanding March 31, 1946—
Obligations issued under Second Liberty Bond Act,
Interest-bearing:

deter¬

Revenues for the

because

lowing

Matured,

retire

our

limitation:

In this

of the Federal Reserve Banks fol¬

indicated

of March 31,1946

Total face amount that may be
outstanding at any

mining how much of the maturity,
if any, should be paid off.

occurred

high level of pro¬

Liberty Bond Act, as amended, provides
that the face amount of
obligations issued under authority of that
Act, and the face amount of obligations guaranteed as to principal
and interest by the United States
(except such guaranteed obligations
as may be held
by the Secretary of the Treasury), "shall not exceed
in the aggregate
$300,000,000,000 outstanding at any one time."
v
The following table shows the face amount of
obligations out¬
standing and the face amount which can still be issued under this

over

Treasury's current cash posi¬
and investigate the prospec¬

tive

bank

and

the money

also have to

ward full peacetime production.

that
been

$276,600,000,000

Statutory Debt Limitation

each

debt

has

Section 21 of the Second

On the

toward

operations

relationship

duction and employment.

debt

financial

from the beginning.
Treasury is now reducing the
debt; and it has so managed its
reduction

exact

at the present

ship of the securities and the ef¬
fect that repayment of these obli¬

its postwar management

debt

The

the

between the gross pub¬

matters with respect to the owner¬

different

may

in detail the information
the Treasury on a number of
factors.
First of all, there are

years;

ings banks, long-term securities
predominate.
About 75% of the

In closing, I should like to em¬
phasize the importance pf main¬
taining a strong tax structure in
order to pay off debt as rapidly as
possible at the present time. This
has the added advantage of com¬
bating inflationary pressures and
will help us stabilize the economy

lic

go over,

other hand, in the case
of insurance companies and sav¬

should like to suggest further that
we
take this matter up again
sometime next year.

Reserve

ten

reconciliation

debt limit

March 31

maturity of a
public debt obligation, I have
found it necessary, therefore, to

about

held

and

helpful in this connection.

shows

intimately

entire

Institutional Holdings

from

and when the debt is

into

structure of

con¬

$48,000,000,000 to $280,000,000,000,;
The reduction ofthebank-helfl
You have .to plan that/ managed debt has come about
directly as a
ment

from

desirable.
Every move¬
this account has its effect

public debt is

woven

reduction in the

conven¬

the financial markets, because

the

On the

ties in

You can't defer the planning of
•postwar "public debt •management
.

find it

as we

considerably higher than we had
originally anticipated.
This has

the

mature

begins holdings

very

to pay off

securities

fiscal year 1946 have proved to be

make

mihutes.

fhe Treasury's cash

mature within this period of time

| management operations.

the

etary situation.

[.the present bill sets the limit a
.little too low; and I shall give
you some figures on this in a few

which

held by nonfinancial corporations

ury some of the flexibility that
[ it needs in current public debt
I believe

date

maturing

for

to $285,000,000,000 from the pres¬
ent level of $300,000,000,000.
I

are not subject to the statu¬
tory debt limitation. The attached

short

between

similarly, about 80%.of securities

Banks

The point that I want to make

the

ient and

particularly, as in the past, when holdings of these two groups of
[fundamental changes in the debt investors do not mature until
forth

months

connection, I have been
very
much pleased—as I know
you have been—by the continued
improvement in the Federal budg¬

the

debt limit is

Its

when

tor

occurred

the

time to time

bond
after .the

made to fit the

was

debt

Victory Loan money
paid into the Treasury—and

other

repe¬

investors.

facts, therefore,
I should like to suggest to your
committee that the bill provide

which

summary

In view of these

States

aggregate reduction

two

The size of

debt to the needs of those inves¬

commercial

mean to say that

Oh the contrary, the Treasury has
always believed—and I too have
both

scious effort

90%

Limit

I am,against having a debt limit.

.believed

classes

have

balance will permit

ticular length of maturity of the
issues that were sold to the vari¬
ous

public

Future Payments

limitation has not meant that the
public debt is a penny higher to¬

have

May 1.

of the appropriation and the "first World War.
Prices of Lib¬
revenue
legislation.
erty Bonds fell to a low of 82 in
There may, it is true, be some the Spring of 1920.
As this oc¬
fluctuation in the volume of the curred, many people sold their
public
debt
in
extraordinary securities in the fear of further
periods of short duration when losses; while others found it nec¬
the size of the Treasury's cash: essary to get their
money, regard¬
Now, the small
pv balance
is being increased or is less of price.
being decreased significantly. But, holders of Savings Bonds are
,in the final analysis and for peri¬ protected against price risks be¬
ods
of
extended
duration, the cause the bonds are redeemable
debt will decrease if revenues ex¬ according to the values set forth
ceed expenditures; and, converse¬ on their face.
ly* the debt will increase if ex¬
There was also planning by the
penditures exceed revenues. The Treasury with respect to the par¬

is, therefore, not the
controlling factor.
The existing

was

ury

.debt limit

28—the

last

selling
by

pressure

other
as

$7,000,000,000

Feb.

market

small investors. There is
tition

show

come

can

such

period

Bonds who need
directly to the
Treasury and get it through the'
facilities of the Savings Bond re¬
demption agents. That was plan¬
of

for

Savings

money

transactions

during this period, the public debt

of the Treasury, and I believe it
was wise planning.
Today, hold¬
ers

these

completed, and after allow¬

will

the part

certifi¬

•••■,.

transactions

into bank portfolios.

This

$1,600,000,000 of
'••

After
been

cannot

securities

those

Today,
move

United

with

cates.

years.

Treasury

of this

it to pay off some of its
securities.
Under these circum¬
use

stances,

•

these

savings bond type that
transferable, and were

approximately

$11,000,000,000

instead,

nas,

$286,300,000,00Q under the statu¬
tory debt limitation.

paying off maturing securi¬ Savings Bonds. The law requires
a
considerable degree the
inclusion of United
States
of rapidity. ; On March
I, the Savings Bonds at full maturity
Treasury; paid off $1,000,000,000 value for debt limitation purposes;
of
maturing certificates.
On whereas, the debt itself includes
March 15, it paid off $1,800,000,000 these bonds at any given time at
of maturing bonds and notes.
On their current redemption value.
April 1, it paid off $2,000,000,000
Exempt Indebtedness
of maturing certificates.
We have
On the
already announced that on May 1,
other hand, there
is
the Treasury will pay off an ad¬ about $1,000,000,000 of debt items

broad list of issues was
by the Treasury.
Some

offered

Government

earned discount of

oeen

ties

resented these types of securities.

^.Congress, then the
•

quired,

than enough funds available

expenditures

ihe

give the varidHS classes *of

occurred in the last six years rep-;

from taxes and receipts

are

particular length of maturi¬
ties that they needed.

the

investors the various securities

tion to the volume of expenditures
J.

Budget Outlook

the statutory debt lirhitation.
The
principal item relates to the un¬

In setting a figure for the debt

limitation,;
made

an adjustment must 'be
between the present -out¬

standing, debt and the amount of

Frailey Class A Stock

Depreciation
war

Policy

and

Post¬

Expansion—Lewis H. Kimmel

—The
Brookings Institution,
Washington 6, D. C.—paper—500

Edward

Parker

Co.,

Inc.*

members of the National Associa~
tion

Securities

Dealers, Inc.* [
offering 58,680
shares of class A stock (par $1) of
Industries,
Inc. * (NeWv
Proposals for Health, Old-Age Frailey
and Unemployment Insurance—A York) At $5, per share,
The net
Comparison of the 1943 and 1945 proceeds are to be used for expand
Wagner-Murray Bills — Earl E. sion, etc.
Muntz—American Enterprise As¬

New

York,

are

Erailey Industries, Inc. has beed

sociation, Inc., 4 East 41st Street, formed to expand the markets and
17, N. Y.—paper—500 distribution of its popular-priced*
trademarked consumer specialties"
in the drug and cosmetics indus»
1
Century of American Life In¬
tries. The three products presently
surance, A—History of The Mutual
sold, are THING HAND
Life Insurance Company of New being
CHE ME, CHAFIX and K-D
York-—Shepard B.
New York

Clough—Co¬
New5 KONES. All of these

lumbia

York

University Press,
City-rrcloth—$4.50

"How Much More Inflation This

Year?"—Searching

discussion

are

market for

number of years.

The class A stock shall be.
titled

dividends

wealth

before class B dividends.

the

balance

this

en*

receive non-cumulative

the near-term inflation risks for
institutions and men of substantial
for

seasoned

products which have been on the

cents

per

iT'YWW/

;

•

Thursday, April 25, 1946

THE COMMERCIAL & FINANCIAL CHRONICLE

2256

^'Because; > of, .the.tqtaliiarialh*
oV government adopted by
for current transactions; to elim¬ eastern and southeastern Europe, t
inate not later than Dec. 31, 1946, free ' enterprise exists in name
The reciprocal agreements
discrimination against the United alone.
States in any quantitative import signed between the puppet pre- '
miers
and
the USSR are complex,?
restrictions; to make agreements
with the countries concerned for but a careful analysis shows that
an
early
settlement
covering whatever business they may wish
blocked sterling balances; to give to transact with foreign nations^
no
other creditor better
terms must be done through Moscow."than these; and to join with the
Totalitarian or parliamentary*
United States in a program for governments have a
great; ad¬

specified exceptions, nil restric¬
tions on payments and transfers
;W^

< Continued from page 2221)

;

/.upon which we ,can pattern

this

^postwar decision.

This is not a
transaction which can be ration¬

alized,

example,

for

such simple

question

upon
as

some

"Will the

vjdebt be paid?" There is

so much
This is. a prob¬

involved.

cmore

lem* involving all the economic
^forces in the complex economic
of

relations

social

and

world

"which

by trial and error must
"struggle back to stability and
"forward
,•,

■.

opinion, Mr. President,

whether

peace.

like it

not, destiny
This is
question whether we owe
we

or.

pose of making general foreign
Joans of this character; and 1 that
the latter require consultation at
a

higher policy level. In my view
particularly includes Con¬

this

ate consider

further amendment

adding — perhaps temporarily—
representatives of the House and
Senate

Banking

.not

niembers.

Currency

and

Committees

Export-Import Bank

the

Board

the

ex-officio

'England the further cooperation
As I was saying, I think it was
ofVnore aid on top of all the other;
vast: contributions which we have a mistake not to have consulted
poured into our common crucible Congress in advance with respect
of war. No one can deny that we
Jhav,e been utterly prodigal in men
and money, in the achievement of
i

yictpry. against aggression—just
as

deny that we have
that not one

can

one

been

utterly lucky

.single bomb fell on the continent¬
al United States, while 4,000,00Q
.houses

damaged

were

de¬

stroyed in Britain. Any compari¬
either score are odious.
Furthermore, they are beside the
point.
This is solely a question, Mr.
President, so far as I am con¬
cerned, whether, all things con¬
sidered, this postwar loan should

sons upon

fie made by us as a matter'of in¬
telligent American self-interest.
It is solely a question, whether
the

passage of this joint resolu¬
tion is reasonably calculated to be
of

adequately compensatory ad¬
to the people of the
•United States. It is solely a ques¬
vantage

tion of whether the defeat of the

joint resolution will be calculated
to
precipitate conditions which

and we shall have again,
surpluses in both industry
and agriculture.
In a word, we
have = a
tremendous
long-range
stake in exports and in world
trade as a matter of intelligent
great

gressional consultations! The Sec¬
We
have
a
tre¬
retary of State is an ex-officio self-interest.
director
of
the
Export-Import mendous stake in what kind of
Bank.
If .the loaning facilities of a pattern world trade hereafter
the Export-Import Bank are to be shall pursue, as a matter of in¬
enlarged by further legislation I telligent self-interest.
This must
respectfully suggest that the Sen¬ be of particular concern to those

.is in these scales today.
a

had,

the

which

details
are

this

of
now

contract

asked

un¬

derwrite. r But I do; not rest my
judgment^ Mr. Prqsident* upon
details, bad or good. I rest it on
the overriding importance of the
concept as a whole.
Let me give the Senators this
analogy: One can tear across a few
pages in a book with one thumb
and finger with simple ease; but
the volume

cannot tear across

one
as

whole, with both hands, no
Thus

matter how hard he may try.

we may demolish separate argu¬
ments in behalf of one section or
another of the joint resolution,

taken by themselves; but in, my
humble but convinced opinion,
cannot demolish the sum total

who

deeply wedded to

are

American

the

Fed¬

including

pattern of full production* free
enterprise, and free competition*

ences.

Mr.

needs—"

President, that we cannot
hope to approach this decision in
a safe mood, for our own sakes,
unless we frankly recognize, first,

ible

that

sterling

this

President

modification
trade barriers,

discriminatory

blocked

trading in the so-called
eration of Labor, when he ap¬
could harm the welfare of our
sterling area which accounted for
peared before the Senate Com¬ nearly one-half of the world's or¬
own
country and our own citi¬
mittee to endorse this measure.
dinary imports and exports, and
zens.
The test is right here at
He said:
almost half of the ordinary im¬
home.
'
"The true significance
of the port and export trade of our own
It is on this basis, Mr. Presi¬
British
loan
agreement to the country.
Our trade was, and is,
dent, that I have struck my bal¬
ance.
It is on this basis that I American worker, the American and will be substantially handi¬
have come to the reluctant but businessman, and the American capped, if not actually excluded,
"firm conviction for myself that farmer is not in the direct effect from most of these vital markets.
the joint resolution should pass of the American dollar provided All these areas—not merely Brit¬
-

shall

briefly summarize

not in a maze of figures
can be
made to prove or

reasons,

which

disprove almost anything, but in
What I believe to be the prepond¬
erant logic in respect to the re¬

alities
This

today and tomorrow.
a
matter of philan¬

not

thropy.

This is

ment—whether

a matter.of judg¬
America, now the

creditor country on the
best protect her own
essential and inescapable position
by these means; whether for our
greatest

globe,

can

sakes

own

economic

must not accept the

well

leadership in

the

moral

wandering world
just as
necessarily for us as for others.

which

other

nation
and

do not

some

stabilized

lead, Mr. President,

great

and

powerful

will capitalize our failure,
shall pay the price of our

default.

must

We shall not stand still.

either

shall

backward.

want

forward

Amercia

cling to leadership. I am unwill¬
ing to surrender leadership to any
power which would take it from

Allied nation in time of the

most critical

To meet that

need.

need is important.
But the real
significance of this loan to us is

the alternatives we must real¬

front

•:

with

many
^.JT

tional cooperation

Perhaps I shall oversimplify the
question, but I shall at least try
to define it in what I believe to be
the

paramount objectives which
in my view outweigh the inci¬
dental details, however dubious
some of those details may seem to
be.

Therefore I lay my founda¬

the following statement:

tion upon

While

America's

greatest

mar¬

the home mar¬
ket, the richest in the world, and
while it will always be colossal
ket will always be

folly
the

neglect

home

market

compromise

pursuit

abroad, the inevitable fact
remains. - that
sooner
or
later
America must maintain, and de¬
sales

velop

supplemental
trade
all
this globe if we;are to as¬

serious details.

interpolate at
this point with reference to my
colloquy with the distinguished
jmaj ority leader in; last .week's de¬
bate.
He expressed the view that
aother foreign loans will be made
through the Export-Import Bank.
I stated then that the Export-Im¬

area

includes all

mean

Roughly, the
British

Commonwealth

and

Em¬

agreements, such as Argentina,
Bolivia, Brazil, Chile, Paraguay,
Peru, Uruguay. Belgium, Czecho¬
slovakia,
Denmark,
Finland,
France, the Netherlands, Norway,
Portugal,
Spain,
Sweden,
and
Turkey.
The fundamental American pur¬

pose

this

loan

provide

involve

area,

from

they

economic war between

sterling and the dollar blocs
which would plunge the entire
world into a vicious spiral of de¬
clining trade, restrictions, and
the

counter-restrictions.

ex¬

work.

report.

that all these
benefits may not accrue because
some
of
them
are
contingent.
That is, unfortunately, true.
But
neither we nor they would bind
ourselves
against whatever re¬
course
sheer ' self-preservation
may

said

might ultimately require.
So we simply come back to the
initial
question:
Is the chance
worth while?
That immediately
poses

the other question, What is

the alternative?

A recent

the

years,

balance

available

other

from

coming

sources—to

To permit her to aban¬

don these restrictive controls. The

controls, of course, involve not
ohly direct, but also indirect and
triangular trade.
I quote two or
three sentences from the commit¬
tee report at

"In the
fore

the

the situation bet*
doi^nri:
immediately ahead;
it is certain that from two-thirds s
to three-quarters of all interna-;
tional
trade will be transacted
either in pounds or dollars.
If I
both circuits are linked in a de¬
could hope to

ter than I

"In the years

effort

termined

immediately be¬
English people

the

imported two-thirds of their food
and

bulk of every important
material except coal.
One-'

the

raw

the

sixth

come

was

British-Rational, in-;

spenr^a *feuy: foreign*

goods.
Britain alone took almost;
20% of the t<ital 'exports of the?

Other countries of the World:"

Britain

agrees

out

current

eliminate Within

She

abolish im¬

transactions;
one

year,

restore com¬
to whicly

petitive world markets,

buyers and sellers alike have ac-y
cess without discrimination,
that
will

the

oL
sterling group i

dominant system

foreign trade. If the
with
its
satellites

organizes a
exclusive effortj
it seems to me, is quite clear. We cannot preserve the trade patternwould be thrust into a world of that we believe offers most to us-;
Mr.

President,

the

alternative,

grid,

closed

barter,

which

once

is intimately linked with
regimentations which are
the exact antithesis of every as¬
new

age

state

piration we Americans hold dear.
In a desperate battle for economic
survival and in the face of politi¬
cal resistance to the new and grim
austerities which the hard-ridden

British people would confront at

our

world.
can

accurately measure
United States of •

the costs to the

and accepting!
But unques-|
tionably they would dwarf to in-J
significance the sum risked in thd,
proposed credit.
We would lose
through
the shrinkage of our
trade, through the wrench of viov
refusing

the

loan

consequences.

lent readjustments in our produc¬
tion 4 p^tterhs, 'and eventually,
tighten' and' expand the various through the curtailment - of ouri
trade controls which already seri¬ over-all
output below what it

home, Britain would be forced to

this point:

years

war

McGraw-Hill editorial

has summed up

"No one

of any nation in mediately any exchange controls
the world.
In 1946, for example, affecting United States products
we
possess ,60%-of the world's imported into the United King-<
factory output.
One out of five dom, or affecting sterling balances
workers in my own. State of Mich¬ of United States nationals arising

We have

joint resolution contemplates that
better way, if it can be made to

requiring that the British do
it."
Mr. President, I subscribe whole¬
heartedly to the sentiment thus

and to the

capacity

-unon

sions

in fact reject

had

the'-United States."

trial

signed to make it possible for the
United Kingdom to reject this al¬
ternative, and it contains provi¬

ly suggesting that we would be
outdone if, I repeat, we did what
it takes to win.
But I repeat that
there is a better way for us and
for the world, and the pending

bilateral

day of need will

come.

is de¬

great attraction, but which in this

dras the; most importajit customer
of a score of countries, including

America has the greatest indus¬

"The financial agreement

of production will also be i
dangerously higher in a competi*
tive field.
But I certainly wouldnot be understood as even remote¬
costs

eign exchange she will require in
a
transitional period of perhaps

do what?

that we should not be able to hold
outside the our own in such a battle if we be
must devise willing to do what it would take;
and impose trade and exchange to Win. We would be undersome- f
controls of unprecedented sever¬ thing of a competitive handicap
ity.
Such controls would stifle because our exports are habitual¬
the
trade
of
every
important ly greater than our imports, and i
country which exports to Britain our bargaining power suffers in j
and the sterling area.
It would proportion. Furthermore, our
currency

Britain with about 70% of the for¬

five

I have no fear

President,

Mr.

"cannot be financed in a convert¬

asserted in the committee

stake.

trary at the moment.
But this
legislative problem demands of us
a long-range view.
Inevitably the

Bank was organized ; solely
purpose of making com- igan normally .depends
anercial loaiia, and not for the pur* port orders for his job.
port

for" the

and Iceland, and, if the system
persists, many nations with which
the United Kingdom has payment

structure
and

•

should like to

our

This

—
monetary, economic,
political—of healthy interna¬
will inevitably
begin to crumble."

aid

finished product demand now pressuring our' in¬
which is far from satisfactory in sufficient stocks.
Quite the; con-i
us

involved in

are

—

considerations.

pire countries, except Newfoundand and Canada, plus Egypt, Iraq,

face.
If we
Britain now

1; 001 around
N There' are things about this joint sure steady total national income
resolution I do not like.
There at the level required for even an
are things I would have done dif¬
approximation of full employ¬
ferently. I think it was a mistake ment, general prosperity and na¬
loot to have consulted Congress tional. solvency. We may need no
when the contract was in the foreign customers at the moment
making instead of waiting to con¬ because of the pent-up consumer
'USr^v

ain alone

choose not
the whole

istically

trade wars because

tire economy.

Referring to the British—

for the sake of America.

democracies in such
they can take
instant action. If Britain is forced
to join this trends-forced as a'
matter of sheer, stark self-preser«v
vation—if she is forced to join r
this trend, either by us or by her
own minorities, we may confront*,
a
dominating surge of bloc ar- f
rangements and trade alliances, >■
with all of their defensive and re- ?
vantage over

Empire tariff prefer¬
\
rty'-'Xt *
assessing the importances of
these
objectives,
Mr.
President—
because the very character of our
and these objectives underline the
own economy tnay be involved; in
what we here do, as I shall indi¬ fact that this arrangement cannot
cate a little later.
possibly be a precedent for any
In
my
opinion, this measure other foreign loans, because they
may prove to be a decisive factor are so utterly individualistic in
in determining whether we are their character—let it be noted strictive devices, which could eas-t J
that the American dollar and the ily force us into kindred action )
to live in a world of decent com¬
mercial opportunity or whether British pound are the two key in reciprocal self-defense, if wa
currencies of the world, account¬ wished to maintain any part .or i
we
are to attempt survival in a
It would f
world of bitter economic
strife ing for perhaps two-thirds of the our world trade at all.
Therefore, in be economic politics in the pat-4
and in a world of government car¬ world's business.
It is prob- I
tels which might make any sort of stabilizing dollar-pound relation¬ tern of power politics.
ships, we are moving in an orbit able that this, in turn, could force
peace impossible.
Peace is indivisible.
I submit infinitely larger, in influence and us, like the others, into a defen- r
that the right answer is of just as results, than the initial bilateral sive state monopoly in charge of >
great importance to us as it is to nature of the loan might mislead- foreign trade, and thus renew and *
magnify the systems of business %
Britain; aye, of greater impor¬ ingly suggest.
Again I wish to quote a few dictation against which we are j
tance, because of our greater re¬
sentences
from
the
Committee
re¬
currently in such violent rebel- '
sources and our greater stake in
lion.
We might be driven toward
port:
^
destiny.
"If
their Xminimum
import more and more control of our en- *
I
also very earnestly submit,
of

the

proposal is not a one¬
of the challenge, which is a chal¬ way street; and, second, that these
lenge to our own American self- are not the pre-Pearl Harbor days,
interest.
;'
■ j which are gone forever.
I was particularly struck, Mr.;
Let us look at the available al¬
President, with a few statesman¬ ternatives.
Under the stress of
like sentences from the supporting world
depression and world war,
testimony of Mr. William Green, Britain established a system of

elimination

the

form

with;

ously

hamstring
and
threaten
foreign trade in many

American

parts of the world.,••

Indeed, there are those

Ti) J

ifi

high

places in Britain who themMyes
oppose this loan because th^r be¬
lieve they can do better fdpffieirj
^country by thus expanding;their;
bwn exclusive imperial spheres,
j

would be under an open,

than

closed, system.. We

lose heavily in economic
under a procedure that can

rkthej
would

libertyf
be foK

lowed with success only by a

close*

regimentation of production
as trade."
/■1

well

this

point

I also wish

quote, Mr. President, from the
of
the: highly
does ; all this leadMr.' statement
able
President?
It is undoubtedly in¬ Chairman of the Board of Gover-4
Where

evitable that Russia will continue
to conduct her foreign commerce

nors

"Star" upon this

of pur own

Federal Reserve

Mr. Marriner S. Ecclesl
exclusively upon a state-trading; who lefthis Vvery /profound ancf
basis.; I do not complain; I simply important admonition
with oui
1.1
state the fact.; I call attention also; committee when he testified:
"Without
effective
British
par-,
to the comment of; ML Constan-i
tine- Brown
in-the Washington ticipation, which is possible only

particular phase:

System,

lend

our

aid, the Brettor

Shah ^absrnfriT

^jyolume 163

Number 4484

■srssr

HjyznmKv immmm %

iH. I'i i*

THE COMMERCIAL & FINANCIAL CHRONICLE

2257

fulfill

cannot

American Farm Bureau Federa¬
tion, when he appeared before our

nomic order in the world, there

committee.

is little
prospect of success for the

we can

expect only

continued drift of world affairs

^toward the catastrophe of

third

the

world war."

K- Mr.

President, it

seems

tendency in

concentrate

credit

United

certain

Kingdom,

de¬

limitations

are so close to the trees that

they
is for

they
large.

on the

forest. Fur¬
details have been

thermore, the
ijand will be amply debated by
pothers.
It is right that they

for

were

the

gain

than

lose

have

con¬
more

•whatever chance is involved.

is the lesser chance, in my humble

opinion.

'.V.

A few incidental observations,
Mr. /President, and I shall
be

offer

„

significant exceptions, almost
this loan.
Again I quote from the commit¬

economic

interest in

(f) Bonds

notes secured by
mortgage upon real estate so
long as the entire mortgage to¬

pro¬

commissions

have been in existence and do¬

ing business for

loan

America, which

association

company
a

period of 10

(j) Any security the issuance
of which is subject to supervi¬

sion,

(d)
Securities
issued,
out¬
standing and fully listed on the
York
Stock
Exchange,
New York Curb Exchange, Chi¬
cago Stock Exchange, San Fran¬
cisco Stock Exchange and the
Los, Angeles Stock Exchange

the public utilities commission¬
er of the State of Oregon.

regulation

control

upon application of the
issuer and pursuant to official
authorization by such ex¬

in enthusiastic terms."

changes, and also all securities

rons

if Second. Without this loan Bret-

of equal or senior rank to any

dencing their respective inter¬
ests in reserves or as patron¬
age dividends.

securities
i.

histori¬
except

its

the
the

force—-to put it mildly—unin¬

tended socialization at emergency

speed*

p Fifth. Despite persistent proph¬

(e) Any security which

to the contrary, I know of
conclusive reason why the loan
should not be paid, unless an im¬

ecy

resents

been

precedent for any
there is no

precedent for other \
loans, because the proposed credit
to,Britain is. intended to meet a

issued

(g)

(a) At any judicial, sheriff's,
executor's, administrator's,
guardian's, or other fiduciary
sale, or at any sale by a receiver
or
trustee
in
insolvency
or
bankruptcy when upon order of
a
court of competent jurisdic¬
tion.

(b) An isolated transaction in
which

security is bought,
sold, offered for sale, subscrip¬
tion or delivery by the owner

by a
in¬
or

a corporation' to organize
the first. instance under the
laws of thiS; state where the

;

beipg

Jh$fI^underwriter\\pf

one.after,t{ie other witftfn

period of such, reasonable time

indicate" \ that one

general

exceptions

and

security

for

the

for

direct

promotion

any

indebtedness guaranteed by Com¬
panies any of whose securities are
so listed
and subscription rights
thereto.'

transactions, arising

as "custom¬
er's orders" and a dozen or so
others provide exemption to se^
curities having a fixed retifrn
which have been

outstanding

"repeated

and; successive
v.

^-(c) The distribution by

Em-

specified number of years (usu¬
ally five) upon which there has
been

no-

default as to interest

principal for

noteis

promissory

issued

the

of business, though
States have set a definite
maturity date' on such paper
course ♦

many

plicable.

Isolated sales, of course
exempt in virtually all States,

are

sales to brokers and deal¬

are

ers, with most States extending
this exemption to sales to
banks,
trust companies, and in
many, to
any corporation.

Securities issued by State banks,
insurance companies and public

utilities

are

Usually exempt if the

issuer is subject, to regulation in
the State where the sale is
being
made.

However, there

are

many

laws

any

State.

Par¬

ticularly is the latter true with
respect to public utility securi¬
ties, and the same exemption is
applicable to public utilities
equipment
securities
based
on
chattel mortgages, leases or condi¬
tional sales agreements on
equip¬

provisions of this act;

ment.
Bonds .or notes
secured
by real estate mortgages are usu¬
ally exempt when sold in the en¬
tirety to
one
purchaser.
Here
again there are many and varied
exemptions
available
bas.ed
on

See Section

Except

80-104, O.S.L.A.

as to the above enumer¬

ated

exemptions,
no
securities
shall be sold within the State of

Oregon
unless
such
securities
have been registered by notifica¬
tion

qualification.
Section 80-105, O.C.L.A.
or

See

the

states

since
were

the

first

enacted

Blue
the

Sky

various

have

states to
of

sound

densome
same

honest

are

attempts by al1

facilitate the marketin.r
securities without bur¬

formalities, while at the
protecting the public

time

from fraud.

property

standard

States

Government, 4 states and
nolitical subdivisions thereof, are
in

virtually all the

ethers, such

law*

the nrovision

ex¬

empting securities listed in stand¬
a cor* ard manuals,
are found only in

the

the percentage of
to

the

amount

securities to

credi¬

reorganization, exchange

securities

case

merger

of
or

pursuant to conversion rights and
the issuance of additional stock

by a corporation; to its own share*
holders, where no commissions
are allowed, are quite
commonly
the subject of exemptions in aU
States.
The

■

above

,
li*
noted, exemptions
<

only the

what

tinent

a great majority of the
states regulating the sale of secu¬
rities. Some provisions, like those
exempting securities of the United

security holders of a cor¬
poration in the course of a bona

all

are

mortgage

value

exemptions in existence ir
states, those outlined above
Oregon Securities Law

return

Issuance

set of

from the

the

debt.

give
no

amount

compared
income

statutes of

•

Six other States have
exempted

scheme or enterprise effecting s
violation or an evasion of any

same aim and are not s6: de¬
tached and separated as to form
no part of a single plan, would

155, 87 A. L. R. 1; Salo v. North:ern S. & L; A«sri., 140 Orb. 351,
12 Pac. (2d) 765.

certain

registra¬
such sale

act,

being made in good faith
not directly or
indirectly

indictative of a pattern man-*'
parts of which are woven into the

in number arid the perspfis who
actually subscribe to such stock
do not exceed 10 in number
with

purpose actuates thei venture
and that the sales promote the

transactions." Kneeland

...

p-.

this

part,

tions

corporation or on
his or its accounts by such rep¬
resentative,, and such owner,
corporation/ ior U representative

erton. 280 Mass. 371, 183 N. E.
"

exempts all ^securities seniojr to
those listed, as well as evidence'of

United States

under

such

owner or

exemption
listed on

tion

whole

repeated and successive trans¬
actions of a like character by

securities

which exempt such securi¬
ties if the issuer is under super¬
vision and
regulation by the

provided numerous
exemptions from the regulatory
effects of the law. These exemp¬

course

persons solicited to make such
subscriptions do not
"exceed 25
,

mend to the attention of the Sen¬

delivery

for

any/responsible exchange; approv¬
ed for exemption by the adminis¬
trative agency.
Usually the, act

fide

account,

exempt, secu¬

20 states make

over

available

Laws

corporation's

owner's

also

other nationally
exchanges; f Although
not included in the Oregon law,

time

the

listed

recognized

sale,

fying

rities

permit under any previous law
of this
state or by

sale,

Although there is

capital

many of these

such purchase, sale or offer for

for

Exchange.
Some 32 acts
an exemption, while

include such

tors

made

of this article, most states exempi
securities listed on the New York

Many have been in existence for
years.
Through the course of

J^ot

some of the
important exemptions found in a
majority of the state laws on this
subject. As noted at the beginning

representative

subscription or
not being made in the

„

tion,
calling attention: to

the

attempting

the comparative legisla¬
it
may
be ; worth
while

by a corporation of
its unissued stock, or his or its
or

any way

the

to brief

Blue Sky Laws are not a new
form of governmental regulation

stock for the purpose of quali¬

any

thereof,

any secur¬

Subscriptions to

security

indirect

not made the subject of a pub¬
lic offering.

pro¬

transactions:

has

...

sold, exempt from the

part of an issue which has
theretofore been qualified foi

the

within which the exemption is
ap¬

pat¬

majority

states.

Without in

issuer pursuant to a
right of
conversion entitling the holder
of the
security surrendered in

of business, when such

association evi¬

same

found

usual

the benefit of the issuer of
such

trust company,

provisions of the act
do not apply to the sale of any se¬
curity in any of the following

or commerce, where such
notes or commercial paper are

Seventh. I think

Also

.trade

ators only a few sentences from

rep¬

which

and

are

commercial paper and negotiable

(i) The sale by a registered
dealer of any
security acquired
in the ordinary and usual course

See Section 80-103, O.C.L.A.

direct

tfye {State of Oregon.,. ^
(f)
Negotiable
promissory:
potes or commercial paper -is-i
Isqeqr given, or acquired in^ai
,,bo$$;fide way. in the ordinary
^course of legitimate business,

in no way a

or a

by such

(h) The issue and delivery of
any security in exchange for
any other security of the same

visions of this act.

certifi¬

ing.

when

ity the ^distribution of which is
subject to the supervision, reg-.
illation, examination or control
of the Insurance Department of

because

American la¬
bor has been wise to endorse this
loan,
because
stabilized world
rade spells jobs.
Eighth. I think American agnlture needs this orderly export.
Mr. President, I wish to com¬

credit union

loan which could involve
the factors embraced in this one,
Mr. President, the committee's re¬

particular problem that does not
exist with respect to any other
country in the world."

interest in

dustrial loan company

other

port is very distinct on this point,
nd I read from it one sentence:
"It has been made clear to the
committee that the British loan is

state bank

•fx Sixth. I do not consider that I
a

obligation

portant part of the English speak¬
ing world is going to collapse.
I
m
unwilling to entertain that
tragic prophecy.
voting
loan,

evidences

of indebtedness guaranteed by

the
commissioner
time for cause, by
formal order, withdraw the ex¬
emption allowed by this section
from any security dealt in on
any
stock
exchange
herein
mentioned; also securities list¬
ed in any standard manual or
supplements thereto and which
maintain a rating approved for
exemption by written order of
the corporation commissioner.

fact is that a failure of the. loan

and

cates issued to members

provided,

Fourth. Contrary to much fear

other

listed,

association

other

the

exemptions

laws

avoid the provisions of this act
or Hot
involving a public offer¬

surrendered has been regis¬
tered under the law or was

membership in such association
or as a patronage dividend
by
such

the

determined period
(again usually five years) imme¬
diately preceding the sale.
General exemption is found, ibi

such stock is issued to" evidence

may, at any

home industry grew.

#an

been

ifor war periods and the restricionist thirties, a nation's imports,
even
of manufactures, have in¬

that the loan will encourage
Socialist regime in Britain,

have

companies any stock of which is
so listed; such
securities to be
exempt only so long as such
listing shall remain in effect;

imports to balance these new ex¬

securities

customers'

upon

any

exchange to make such conver¬
sion, provided that the security

membership cer¬
tificates issued by an agricul¬
tural cooperative marketing or
purchasing association where

listed

ton Woods is all but nullified.
& Third. We need not fear added

absolute basis

(k) Stock

New

exchange or in
the open or counter
market, but
not the solicitation of such or¬
ders, where there is no intent to

shall

the United States.

which

orders

years or more.

executed

ers,

Any security issued by
insurance company incor¬
porated under any law of any
state of the United States of

is to be issued by a na¬

farm

(g)
Agency
or
principal
transactions by registered deal¬

are

gether with all of the bonds or
notes secured thereby are sold
to a single purchaser at a sin¬

impressively demon¬
strated during the hearings on the
proposed joint resolution.
Dis¬
playing a unanimity of purpose,
almost never encountered in the
legislative process,
representa¬
tives of labor, business, finance,
industry, and agriculture all ap¬
peared before the committee and
supported the proposed legislation

on an

(e) The transfor or exchange
by one corporation to another

any

by any corporation creat¬
or acting as an instru¬
mentality of the Government of

was

creased

must qualify such securities be¬
fore selling or
offering them for
sale to the public.

(i)

has

dealer

gle sale.

direct

which

and

dealer; provid¬

ed that such broker

Exempted

repre¬

regis¬

porations.

national
...

public support for

port accounts because the
cal record discloses that,

tered broker

to ariy

ble in the expectation that events

by a Federal land
bank, joint stock land bank or

;

international

livery of securities

de¬

corporation of their own securi¬
ties in connection with a consol¬
idation or merger of such cor¬

where

similar

Stock
or

parison with the total problem. If
they are wrong, the cost would
be immense, and could be catas¬
trophic. I choose the lesser gam¬

state.

tional bank

few

gram

exceptions,

will vindicate such action.

thereof main¬

corporation, with certain

;:h .(d) The sale, transfer

given, I believe it to be
duty to support this joint res¬
olution.
If I am wrong, the cost
will be relatively small in com¬

ment.

been

invariably.; recommend

this

sale

obligation

;"The strong

such

completely

paid.
(h) Any security issued by a
savings and loan association or¬
ganized under the laws of this

sents

.through,
-.
^ First, I cannot ignore the fact
that our experienced leaders in
trade-and commerce, with a very

matter.

taining diplomatic relations, or
by any state, province or politi¬
cal subdivision thereof having
the power of taxation or assess¬
(c) Any security which

tee report:

this

...

„

(Continued from page 2217)

taking

many
of my
of my constituents,

reasons

Securities
or

dominating
we

subscriptions to an
increase in capital stock made
by the stockholders of record of

respect their view, as I hope they
will respect mine.
But for the

greatly, enhance
the
chances of trading blocs, frozen
exchanges, cartels, trade restric¬
tions^ and the whole category of
things that have in the past, and

which

interest

court

'resolution in terms of intelligent
-

corporation following reorgani¬
zation under the supervision of

what

and many of my ♦colleagues
upon
this side of the aisle disagree with

will

I repeat also that I find a final
.balance favorable to the joint

our

many

the laws of three other states. In
the main,- however;

...

itself has

peace

a stock dividend
issue of se¬
curities tq the existing security
holders or other creditors of a

But

details which I do not like.

self

Ameri¬

world

think

other securities to its stockhold¬
ers or other security holders as

necessary

President,

friends,

Mr. O'Neal still speaking—

explored. I do not for an instant
depreciate the importance of these
details.
I repeat that these are

sideration. I think

trade

weighted twice

stake

great

Mr.

"If this loan is not made—"

"it

should have been, and they should
toe fully, totally, and ruthlessly

heavily of agricultural products

do not see the forest.
It
*this reason that I have purposely

I concentrated

were

the

one

poration actively engaged in the
business authorized by its char¬
ter of capital stock, bonds or

;

happens
upon this issue here in Congress.
So does free enterprise and the
American way of life.

cannot afford to
these restrictions on trade.
Our exports to the United

American

Ninth.
a

Britain's

upon

stepping stones in developing
brighter world of tomorrow."

agriculture

can

have

ylution that the larger, total cori4-cept.is obscured—like those who Kingdom

tought to be

advanced

with the nonsterling area.

some

tails in respect to this joint reso-

Britain

only alternative is the placing of

that there is
.-quarters-to

"Unless

r.Wv

ing of living standards for many,
many people. I view this loan to

/'Unless credit is advanced to
the United Kingdom—"
Said Mr. O'Neal, in speaking for
the American Farm Bureau Fed¬
eration—

United Nations Organization in its
for political stability and
security. Without economic or po¬

ui search

litical stability

h$;

testimony of will in the future, lead to distrust,
O'Neal, of the stifling of trade, and the lower¬

the hopes which we have
placed
-in them,
Without the fulfillment
aof these hopes1 for a stable eco-

;.'C

the very important
Mr. Edward A.

-*}s

;

7\ Woods' institutions

may

the

general trend of
be found in the laws

several
act

States, Each per¬

must

examined

determine the exemptions avail¬
able. It is sought here
only to
point out that there is a wide
>

field

tions

securities

and, transac¬

relating thereto

upon

whichi

attempt is made at regulation.
Persons concerned should famil¬
iarize themselves with these ex¬
emptions. It is the hope of the
writer

that

the reader

this article will give
a

more complete view
exemptions from State
regulation.

the

;

Thursday,- April 25/1946

CHRONICLE

THE COMMERCIAL & FINANCIAL

2258

Difficulties in "Registering the Permanent- Guests."

Ohio Brevities

Widening Big-Power Rift

(Continued from page 2225)

The

company

to use

J buy

Demonstrated at UN

the

-registration statement said
Trice would be $6.50 a shared
*

said it proposed

(Continued from first page)

$445,710 of the proceeds to
ever

equipment, lease or
build a hew plant and for working
I' capital. The company is selling
80,000 of the total and stockhold; ers 50,000 shares.
I Otis also announced it had
applied to the Ohio Securities
division for authority to sell
new

■""

Time and again in

States

United

his lengthy oral representations on

Gromyko

Mr.

question

and

the Iranian

has openly impugned the motives of the
He has Called Messrs Byrnes,

Great Britain.

gether with the Polish delegate has accused
Britain of using Iran as a political pawn and

at all inconsistent.

the

some

its

and Donald M.

the

pressure

claimed to be one of
the largest iron ore deposits in
the World, is being constructed
under a lake in northern Ontario.

announced.

?
*

Council

City, was elected a director of
Harris-Seybold Co, of Cleveland;
at

company

from Harris-

name

Seybold-Potter Co.
Wasserman,

one

large

the

stockholders, is a partner in the
firm of Wasserman-Behr-Shagan,

York

New

Persians, such as would be assured by a
as exists with the British and Americans.

Principal products at pres-

and

offset lithographic presses

precision paper cutters.

Then there

are

issue

$41,500,000

mortgage
series
F
bonds of New York, Chicago &
St. Louis Railroad (Nickel Plate).

are

some

; The winning bid was
101.529
for 3% coupon rate, averaging an
annual
interest
cost
of
about

2.935%.

led by

second group,

Barney & Co., offered
100.32 for
3s, equivalent to an
average annual interest cost of

Smith,

2.99%.

arriies" apart—a- nuisance and cause of inefficiency for secretariat..
members and for ail others having business at both places.
From
mid-town Manhattan it is 22 miles to the Lake Success plant whiclr

and bus; or subway and bus. One will \
Flushing Meadow somewhat.more easily by Subway
or Long Island
Railroad, with the aid of the special World's Fair;*/
facilities being restored by both those carriers. 1
either automobile,. train

use

be able to get to

The Personnel Housing

of UN

Interference by Power

new

from some place j
contingent is now %
bivouacking about the city as best it can, on a strictly makeshift
basis. Even Dr. ^Qtiq,, Jhe Council's . recent presiding officer, is only
temporarily checked-in at the Waldorf-Astoria Hotel.

prewar population was but 734 or else commute
like Jamaica. The present small Security Council

utterance^: lauding UN

as the saviour of civilization. They feel that
Fede&al. Government is merely hiding behind technical legal
in not taking over a mid-town hotel, as the Waldorf-Astoria,
toto. If.
'
M-. "
;
•
i

the

excuses

■

Administrative and Assembly Housing Difficulties

greatejphan in the personnel dwelling situation have been^

the bickerings, filinoyances, and dissension connected with finding^
increasingly evident that the area of direct dip¬ even a temporary resting place for the secretariat and for the As¬
lomatic negotiations, and bilateral political maneuvering, are becom¬
sembly meeting^;- While the $17,000,000 Sperry plant .with a 647,0007
ing ever wider, and that their encroachment on the concerted func¬ foot area for UN, and with an air-conditioned floor affording space if
tioning of a world body presents a pressing fundamental problem. This 421 feet long and 214 feet wide, and with a ceiling 40 feet high, I
is particularly true of many questions which will come up for settle¬
gives adequate inside room, there have even been nasty wrangles ;j
ment after the items which are currently on the Council's agenda. here.- Former
Mayor- LaGuardia is issuing continued blasts against.
One crucial center of continuing Soviet-British power politics will be
use of the plant; because of the local county officials' insistence or •}
the Mediterranean area. It is not fully realized that Great Britain
M
collecting taxesSK -:
has been as active as the Soviet here. She has been getting ready
for the revision of her expiring treaty with Egypt, and she last
month granted independent status to the former League mandate
of Transjordan. A strong British delegation, to
be joined later by Foreign Secretary Bevin, is in
Cairo. Matters to be adjusted are the presence of
It is becoming

•

The road said the hew

| will

bonds

replace the series D re¬
mortgage 3%% bonds

funding
-of

1975,

which

there

were"

$41,796,000 outstanding.
They
•Were sold lat competitive bid-

ding Dec. 19, 1944,
and

interest

rate

ri%.Association: of

Egypt's

3.73%.

Reserve

City

Bankets elected Sidney B. Cong-

don, President of National City
Bank of Cleveland, as their new
President at the group's 35th na¬
tional convention in Palm Beach,

Congdon succeeded Robert M.
Hanes,
President
of Wachovia
Bank
&
Trust
Co.,y Winston*
:

Salem, N. C. Thomas M. Conroy,
Executive Vice-President of Cen¬
tral

Co.,

Trust

named

Cincinnati, was

three-year

the board of directors.

term

troojis;-Md other; activities of Britain in-main* >
taining internal stability,- without disturbing $

price

averaging an

annual interest cost of

;

visiting delegates are voicing considerable and in¬
creasing bewildejmerit over the apparent demonstration of American
inhospitality.
They do not understand the private arid business
housing difficuiees,: in view of the invitation extended originallj
by the United Slates Government, and in the face of the idealistic;
Most of the

Even

Politics

Problem

Long Island location, if possible, aggravates further the
existing dwelling problem. For many of the present secretariat live
in or north of the Bronx, and will feel like re-locating nearer their
new working habitat.
The 5,000 prospective members of the secre¬
tariat and their families will have to be housed in a village whose
The

boycott encore, even to a greater- de¬

In San Francisco - the i'

Assembly, Hall and the Secretariat offices actually will be nine

awarded

factor of inconvenience.

The Security Council now stationed at 1
good half-hour from midtown by subway-and-foot but |
aQeast once the destination has been achieved, no further traveling,
the 4
Hunter is

fast scuttling it in its basic purposes.

refunding

i^ the

bus, cab, cable-car, or foot.

gree than his direct skirmishes
the widest repercussions on the

which

{

Mr. Gromyko's promised

UN's

delegations and other working units were scattered about the e&yi/|
but the traveling time was mostly a matter of minutes, by special*-j'

vis-a-vis the other Powers, harbors
Organization—in fact, repercussions
For how can any
'
*
#
*
body function if one of its important members adopts the technique
Otis & Co. chalked up another
of simply walking out when the majority makes decisions displeas¬
competitive bidding victory last
ing to it?
Monday (April 22) when its bid
Further definite complication is introduced in this situation be¬
of $15,651,510 was declared the
cause, according to the Soviet's own previous insistence, its absence
lowest for proposed $16,500,000
constitutes an effective veto on all "substantive", questions—thus
preferred and common stock fi¬
paralyzing the entire important functioning of the Council.
nancing of Indianapolis Power &
The basis for the stringent veto arrangement, advanced at
Light Co., of Indianapolis, Ind.
Yalta and San Francisco, was that Big Three unanimity was indis¬
'is The Public Service Commission
This is
of
Indiana
ordered competitive pensable to the working of the Charter—veto or no veto.
bidding, following demands by being more and more clearly confirmed as UN's career goes on. But
.-'Otis & Co. and by the City of In¬ correlated therewith must be despair over the ever-growing Big
Power rift,
as
demonstrated by Moscow at every step.
The
dianapolis.
"W Halsey, Stuart & Co. headed a only alternative to even more serious trouble, seemingly is to make
Troup of 88 firms which were of the Council an aimless forum, debating in vacuo for the record.
are

of the

free-handed arrangement,

Moscow's Undermining

Harris-Seybold for more than 20
years.

will house the Secretariat, and seven miles to the Meadow Assembly
Hall. To reach Lake Success from Manhattan it will be necessary to

oil agreement there

specific

of its promise to restore their playground to them after, 1
Fall session. Meanwhile, should any of the delegates deI
cide to "do a Gromyko," they can swiftly roller-skate instead of
f
walk, out of the proceedings.
J

After the Oil has been extracted, it will be
sold in the single market of Russia; as the Russians will for the
first 25 years of the agreement hold a 51% majority interest, they
can
dictate price policy, and thus limit the profitability to the

for

counsel

legal

with the

functioning

use

the

unsatisfactory aspects.

stockholders also voted to change
the

connection

New Yorkers, remember

keeping

as a rink dashed around in by ice
and roller . ?
organ, at 22 cents per. hour (including/•]
City's skates). But even here the UN is on borrowed J
time.
For, joining the burghers of Fairfield County and Lake ;{
Success in their "addresses of un-welcome," 200 men, women, and
j;
children skaters have formed an association to ensure the city's
I

the

May 6.
?!»

which

meeting

special

'W?

skaters to the "tunes" of an

will only be further enhanced by
the Soviet's refusaL to report on, or discuss, the matter with the

York

L. P. Wasserman of New

been

The resulting mutual distrust

si:

Sept.

it subsequently became^an offensively smelling rat-breeding{ i
dump.
Since the dismantling of this $11,000,000 pride of Mayor ; $
LaGuardia with its animated exhibits, the premises have ever since

The mine,

tidal marsh sprouting salt hay

or,

dent.

sisting, the Council's overwhelming majority. In the first place the
background of the whole situation has been, and still is, that Russian
troops in Iran since March 2, have been and still are there in direct
and undeniable violation of the 1942 Treaty of Tehran,
Then there
is the question whether as a result of this unlawful presence of the
The application gave a $4 offer¬
troops, Iran's freedom of action has been preserved; or whether her
ing price "for the purpose of fil¬ sovereignty, as investigators are testifying, has been violated by
ing" as a maximum price for the overwhelming Soviet pressure-^-a suspicion that has naturally been
stock had not been determined.
enhanced by Mr. Gromyko's near-filibustering to remove the mat¬
*
S&
*
ter frdm further consideration.
And the skepticism has understandA low bid of 1.50%, made by
akly^been greatly enhanced by Iran's somersaults before the Council
Chase
National Bank, was ac¬ itself. First the Iranians unequivocally and repeatedly affirmed to
cepted by Erie Railroad for $1,- the Council that Stalin's demands must be rejected as contrary to
890,000 promissory notes to fi¬ all treaties, to the Charter, and to the Iranian Constitution.- Subse¬
nance less than 80%
of the cost quently on April 4, despite all these professions, Premier Ghavam
of 700 50-ton all steel box cars to suddenly reversed
himself by announcing an agreement.
Then
be
built
by American Car & within the period of the week which followed, Iran successively
Foundry Co. at Chicago. Delivery asked the Council to keep considering the case, then hedged by
is expected .to begin May 15.
saying that the Council itself must decide, and one day later, asked
Notes are to be dated April 1, that the matter be removed.
And meanwhile the entire atmosphere^
1946 and will mature quarterly in
Persia has mysteriously
changed, to the accompaniment 70k
over
a
10-year period, the Erie censorship, to a distinctly Russian hue.

soned

withdrawn on schedule. But this skepticism
Soviet itself unfortunately has forced on the other Powers con¬
general

the 52-nation Assembly will become a tenant in
the colonnaded, limestone and glass New York City Building of .the
late lamented World's Fair. This is in Flushing Meadow, which seaOn

Hogarth of
West Toronto; Canada, is -Presi¬

And—with

cisco; to Church House in London; and is now camping in a girls*
gymnasium and swimming-pool in the Bronx. With this itinerary
the September locus of a skating rink and gyroscope factory is not

deliberately to stir up anti-Soviet trouble.

justification—the Soviet regards as a slur on
honor, the Council's refusal to close the case on the basis of
their and the Iranians' assurance that the troops will be out and

man,

In the first

place, there is the question of the World Organize^
tion' prestige, the importance of which is regarded in varying de-.
grees by the members.
While the League of Nations' $26,000,000
of buildings and Geneva's spacious park may be over-luxurious and
otherwise
unnecessary,
still the contrast with UN's bivouacking
career
seems
a
bit too sharp.
Our august international body has
successively toured from a private home known as Dumbarton Oaks,
to an opera house, veterans' building, and barracks at San Fran¬

the United States and
"football" with which

Mines,;: Ltd. of which Cyrus
Eaton, Cleveland financier and
head of Otis & Co., is Chair¬

"business'* and private housing problems

have^iinpHc&tiohS;exteh<Bng":far bfeyonditheir^^ earher ntere "grinihg'^
Stage. It is far from being iiist a real estate and housing matter! \ *

Stettinius, and Cadogan "more Iranian than the Iranians," has termed
Mr. Stettinius' contentions "without logic" and "senseless," and to¬

par com¬
stock of Steep Rock Iron

mon
■■

"ganged-up" against Moscow.

shares of $1

500,000

Western Powers have

strongly to the premise that the

United Nations'

The

sovereignty..

Dr.

Hafez " Afifi

Pasha, |

delegate to the Security Council, has %
recently stated that.he may submit his country's in¬
case thereto.
As he will be functioning fur the p
next month as the Council's President, a most?;

Egypt's

new

interesting situation might thereby

develop.

Alse in addition to the bilateral or

trilateral";

Germany, Manchuria, I<?eland; Korea, Italy, control of the Mediterranean,
Yugoslavia, etc., etc., there now has arisen
question involving the Russian-Rumattian border
pressures involved in

definition. Lack of clarification
>

to what Mos¬

Hafez
•,

is after, as seen

in her unsatisfactory answers
to official inquiries from London5 and Washing*
cow

Afifi

ton, are eliciting fears that she may be seeking control
of the Danube River, which flows into the Black Sea,

Pasha
'

•'

Noio

■

•

*'^'

pre$iding3^
.Council t

of the delta
v

The-'SfterfU CoTff. 'Building which will house the

Secretariat

t Volume 163

Number 4484

TH^COMMERClAr'&riNAMCTAt^HRONICrfi

mmtmmmmmrntmtmmtm

Regarding the Flushing; end; of the, deal,-

as the.main

building overcrowded eityyTh^reason thereforwhichis nowmost consistently

comprising a 45,0&0 square foot area, has no facilities suitable for
the press,, loir offices, or for- eating 6nd;, drinking, the
.Gity agreed to.
add these atcoutrements at its own
expense.
Originally this was to
involve an outlay of $1,200,000, but much to Mayor O'Dwyer's disC fgustf the UN officials' revised wishes for
$650,000 of landscaping,
i .attd other fixings, quickly raised this
by a cool million. This has

since been compromised, at $500,000, making
of $1,700,000- for its two-month
guest—with

|r
!

all-'round.

}

%
,•

total cost to the City

ruffling of tempers

•

■

..j^New York Not Indispensable-—Let's Return

to San Francisco!

Apart from any dereliction of duty on the part of our Federal
Government in failing to carry through on its invitation and
obligam tidhs to tJN, and apart fromt the rights/and Wrongs in the. continuing.
arguments, it seems that the over-all mess has to a great extent
been? the result of the Organisation's; own
selection of an already

Compromise {;

advahcedf is the proximity' of relevant information;:: (thei alleged
ttigftt club motive was really- never very, iihpotfant)./ But; as evi¬
denced at SM Francisco, copious ihformation of
every kind and
description will % transported^ the World capital Wherever it
may;
be located. Actually no logical affirmative reason has been demon¬

Silver Bill

strated for

which is

the

"indispensability" of New York City.

Even if San
other suitable

(Continued from

•

Francisco is considered remote, there
surely are many
communities available in this, ]sparsely settled - country. Arid the
smaller a community is the greater Will be its pride in,; and splicita*
tion for, the requirements of a world
capital; At best, and even apart

in New; York;^^ commodity circles,
has long been sought by Senator
Pat McCarrani' and at one; time
passed the Senate some years ago.

from the present boom
shortage in facilities in New York, the Organ¬
ization wilLreiativel^^^ be swallowed up there; in contrast to its
pre*
eminent importance fd less eosmdpolitarteenters. From this
angle, as

Latterly Senator Abe Murcock of

well

peal of those sections of the 1934
Act.

because of its "know-how" gained from Its previous

Utah, another silver Senator, has
been reported
asifavoring the rer

tJNCIO

experience, and

for sentimental > reasons, Sari Francisco would

even

•

seem.to be ideal.,

And,:of genuine importance, it still really wants

Whether the

;

structed

by
ceilings

all

tain.

IIS

Sal
>,■

silver is

It may

OPA will

in¬

Congress to

remove

not

not remain

cer¬

in the

Hayden y amendment, -should that
otherwise be accepted> by : both

it,
•

mm®

sides. But the other
provisions—
numbers \1> Z and 4 of the above'

upon

Ipv,

2219)

page

of considerable interest

mm®

list^r-now

seem

likely to be agreed

according to

persons close to

the ringside.

•*4i5P

As to number orie. The Indus- '
trialists" are rioW'taking a: stand

the 90 cents price and for a two
period.i The;miners^iin gen^f

year

erai are

standing pat^

Qti $1.00 ah ^
for an increase to $1.29
between one and two : ?
years,, with the industrial consumT
ounce and.

sometime

pressed

ers,-

because

lack

supplies. The mining Senators
using

club the factor .of delay.
McCarran's 6i witnesses

as a

Senator

still waiting to

are

of
are

testify.;4 From

the

standpoint; of time the most
that^^ thc^irtdristriaiiritefests
to .obtain ffom the mining bloc at
90

cents

years'

thereabouts

two

Treasury silver.

access

That price a temporary ceiling
for

industry.

The

make

means to

for

itself.

mining

bloc

permanent floor

The

present statutory

floor

of 71.11 cents dates from
1939 when the mints were
opened
to all newly-mined domestic sil¬

The

Press covering the Security

the show—as is testified to by

Council's deliberations in Hunter College's

eleventh-hour flight here made by
its special pleader Jerome Pollistter, last
February.

Altogether logical is the veering of Mr. Stetinius' preference to
the Golden Gate—although some nasty
people are ascribing as the
ihotive therefor, the greater commuting
difficulty for his mentor.
Secretary Byrnes.
*

:'f

Political Factors Involved in Permanent Site Selection
Broad political factors are

involved in the site problem, as they
in practically every other matter confronting the UN. The
ques¬
tion far transcends the mere matter of
housing. If it was a mistake
to choose the United States for the permanent
site, that error cannot

■*%

are

**■"
a

■

\yy?

be remedied by now merely moving across the Atlantic. If the
Organ¬
ization had started its career abroad that would have been one
thing;
but departing from this country after once

having begun here, and
particularly in controversy, would greatly intensify America's ten¬
dencies toward isolationism, and more
particularly, her cynicism and
indifference toward the United Nations.
Also involved

the power politics which are splitting all other
major decisions. It will be remembered that the United States was
chosen by the decisive factor of the Soviet vote.
Britain
and
France preferred Europe, and the South American countries wanted a

■f
if

are

United States site.

The Russians felt that a
European choice would
influence; they have had an aversion to the League
Geneva, and they believed that an American locale would mini¬

enhance British
and

mize

United

States interest in

interference

and

with

their

Eastern

si"
I

political

controversy

the

over

matter

will

kept

active, by the
A satisfaction with which the newly-evidenced American
leadership is

received by the run of the other

■:i nations.
\

How

with

problems

the

such

basic

Conference

and

General

important basic

and liaison
own

question

whether the Council

|
'

capacity,

Council

can

affirmatively function

full

session

will

Administrative

May

place,

would

would all

entail

success

imaginable direct

Seemingly success
in raising world employment than

panaceas toward

from

this laudable end.

subsiding, the Council's fires of controversy

additionally stoked with the Franco fuel.

and

*•

;

to. Get Started
organizational spade work

floor.
One feature of McCarran's bill
omitted from the Hayden substi¬
tute is that Which would requite

applicant for Treasury silver, to
his

inability

silver

buy

elsewhere.

How the House will react to the
above-described triangular Senate
deal this writer cannot predict.
Mexico is reported contemplat¬
issuance of a 5-peso silver

ing

coin.

Relief

Rehabilitation

and

in a letter- ad¬
dressed to the retiring DirectorGeneral on March 25.
According

participate most fully—if not actual¬
Fortunately a breathing-

vengeance.

formally investigated.

given

Here is the

mes¬

"As

Charter,

Sofcqfii^ Cbrincii Raving

supply ships carry to the
area

Asia

relief

the

United Nations,

and

security,

endangers international
the

Security

Council

Europe
goods

and

which

Charter, to make further ;inquiries
(Continued on page 2260) 4

the" world, the people pt tbe

receiving

resolves^ in accordance with Article

of the

UNRRA has sought in every part

national friction

and

the

devastated

Id declare that this situation has
led to inler-

hereby
-

tions

bringing effective aid to millions
of our liberated Allies."
In clos¬
ing* the President said:
48 v

peace

•

the

situation

finding" delegate.

for

ture of international cooperation
had been built up "which is now

in accordance with Article 35 of
the

fact-

exoressed

"Times" in

The attention of the Security Council
having been drawn to the situation in Spain
a member
of the United Nations
acting

Australia's

Truman

admiration

and

work accomplished by HerberVH.
Lehman as head of the United Na¬

sage

Hodgson

President

praise

to the text of the President's

text which includes the nub of the
question:

Work of Lehman

delegate, the non-conforming and
"fact-finding" Col. Hodgson, that the Franco

of the economic sphere of the Council's operations, so-called nuclear
-committees will begin meeting Monday, April 29 on the general

now

r Australian

legislation was
itself produced by a sort of leg¬
islative legerdemain during an¬
other compromise on the Senate

in the crisis-atmosphere has been, afforded
through the submission of the proposal by the

ly with

gridthe

^ek.:Ai planned by Mr. pwen- of Great Britairi/who.is in charge

are

With this matter next

space

•

consumers

1939

New York
a soecial dispatch from
Washington, Mr. Truman told the
one-time Governor, of New York
that under his guidance, a struc¬

here indeed

*'■?

Laugier and David Owen, the
Economic arid Social. Council will held preliminary meetings next

The

Administration,

the Council's turbulent agenda—the Russians will

Financial

industrial

President Praises
here

preliminary manner, in England in the Fall.

here

...

sion

silver.

its

meet

The contemplated International Trade Conference will take

Far

Secretaries-General Henri

up next week, will be a
function merely in an advisory

to raise the Treas¬

price and no time
limit for such price raise is speci¬
fied the mining bloc will be re¬
ceiving a permanent increase; in
exchange for a two-year conces¬

state

25, under its
permanent Chairman, Sir Ramaswami Mudaliar of
India, who per¬
formed such a splendid job in
incubating the body in San Francisco.

Economic and Social Council

Reflecting ^ tnuch -preliminary

coming
to

whether it

❖

The

agencies and non-governmental bodies.

Assistant

employment is

buying

initiative.

•'

41;

paratory committees to meet here next week include those on (1)
Rights of Man and Woman, (2) Human Rights, and on (3) Liaison
Arrangements with UN Organizations, as FAO, et al.
An

perpetuity. If as part of the *
the 1939 statute is

amended

sn
*

that

the

The possibly more practicable and effective social
segment of the
Council will also get started in embryonic fashion next week. Pre¬

\ Services, Legal and Public Information. ;
*
r V
4^;>^Thesri principal departmefttSiwill he further subdivided. For .ex*;
ample,-the one on Economic Affairs will be organized into various
sections, as Economic and Employment, Fiscal, Statistical,
Transport
arid Cdmm'unications, arid a sub-division for liaison with the special-'
ized

prevails

concept
#

There ; will be nine

Services,

solved

principles governing in either Great Britahl

Union, where the
obligation of the State?

branches of the
^Secretariat, including the interim London office, and the depart-;
laments of Security-Council Affairs, Economic Affairs, Social Affairs,
a Trusteeship
and Information for Non-JSelf-Governing Territories,

can

The Spanish Issue
*

By the end of 1946 the secretariat will comprise 1.937 employees
l^foui4 times its
a rripdft recently submitted;

]f to' Secretary-General Lie.

these

Soviet

decision

ury's

by international
techniques is, however, quite difficult to comprehend. Non-enroachment on sovereign national
practice is guaranteed both by existing
conditions throughout the world, and
by the very provisions of the
Charter. On employment
problems, for example, how can the Ameri¬
can
background behind solutions possibly be made to conform

particularly the smaller

Further Expansion of the Secretariat

Statistics, and (3) Transport and

presently devised by the Council's Brain Trust, its two eco¬
nomic aims for a better world will focus on
(a) economic instability,
and (b) unequal standards of
living throughout the world. Its rele¬
vant points of attack are to be
through raising employment, and
through securing better distribution of raw materials.

V -5

|■

powers,

(2)

European doings.

In the latter supposition they have found that they
completely mistaken, beginning with Mr. Byrnes' aggressive
leadership in the Iranian proceedings of the Council. Hence it is
understood that there have already been surprising
suggestions from
Soviet officials that perhaps after all Geneva Would not be so
bad,
and that its $28 million structure ought not to be wasted. But the

ver

swimming pool.

compromise

(1) Employment,
Communications.

were

erstwhile

questions of

UNRRA

less than those

aid,

will

;

grateful to .your for your part in

making possible
in the interests of

lasting peace."

/^V?'2§0< ■

••

»■

•

Ttorsdayy April ,25,I94?f

yitUE COMMERCIAL & FINANCIAL CHRONICLE

Widening Big-Power Rift

S-iifc •

Demonstrated at UN
i

(Continued from page 2259)

;

whether such- a situation does exist.
To this end the Security Council appoints a committee of
five of its members and instructs this committee to examine the
statements made before the Security Council concerning Spain,
to call for further written statements and documentary evidence
from members of the United Nations and from the Franco
regime, and to make such other-inquiries as it may deem fit in
order that the committee may report to the Security Council not
later than May 17,1916, on the following questions:
in order to determine

...

;i"

...

(1) Is theSpanish situation one essentially within

.:c

(2) 1$ the situation in Spain one which
national friction or give rise to a dispute?

unsatisfactory situation to

1
.1

\-v. v; ^ ^

■

-t

the

(Special, to The Financial Chronicle)

moral high

"Stop

the

hypocritical

attitude

generally assented

saying: 'We dislike
him.' The Spanish
of a peaceful discussion
of

away

(Special to The Financial Chronicle)

BOSTON, MASS.—Leo F. Stan¬
ley has rejoined C. F. Childs Sa
Co., 82 Devonshire Street.
(Special to T8f;F!#ANCMI, Chronicle)

CLEVELAND, OHIOr-K, Mitch¬
with Cun¬

now

ningham Sa Co., Union Commerce

Building.

(Special to The Financial

Foreign
Office, Quai d' Orsay, the humiliating parade of intriguing lobbyists
and beggars for support.
Spain must start anew, as all political
regimes have forfeited their rights and their claims.
The Monarchy
voluntarily abandoned the country after hurriedly Admitting its de¬
feat in the free elections of April 12, 1931.*' The Republic was rapidly
discredited by its inefficiency, dishonored by anarchy and weakened
by internecine struggles of emigres.
Franco swore his role was
"Keep

k>:

Alfred

the staff of Slayton & Co., Inc.

the actual Spanish situation could

The Spanish people should remove

—

Steinke has been added to

E. F.

necessary

ARBOR, MICH.

ANN

ell Dombrowski is
-1

to, many important and contentious details will have to be settled.
Firstly, there is,,-the question of what witnesses are to be heard; the

People cannot do this, neither by means
nor through an unequal armed revolt.

from the State Department, the British

CLEVELAND,;

•

Chronicle)

OHIO

—

Fritz

Hultin has become associated with
Johnson & Co., Engineers Build¬

ing.

!•"

.'V-,. v..

of testimony by the'Franco
(Special to The Financial Chronicle)
regime, and on the other hand, the American s and British will corCOLUMBUS, GA.—L. II. Mor¬
respondingly not permit Dr. de los Rios or the rest of the Spanish
rison
has
joined the
staff of
Government in Exile to give testimony.
Then there is the question purely transitional.
Courts & Co.
whether our State Department files shall be made available to the
c.
"Offer to all Spaniards what they have not: a quiet and
committee—to meet the Communist charge that Washington is sup¬
undisturbed corner to talk and try to build a bridge to peace¬
(Special to The Financial Chronicle)
pressing significant information.! Also there is the question as to the
ful, constructive normalcy.
In other words, set in motion a
DAYTON,
OHIO, — Annabel
makeup of the committee. Russia, Poland, Mexico, China, and Australia
procedure comparable, mutatis mutandis, to voluntary arbitration
Ivory has joined the staff of Slayhave severed diplomatic relations with the Franco Government, and
in labor conflicts.
However, with one important difference:
ton
Sa
Co.,
Inc.
hence might be ineligible to enter Spain, or otherwise to give a com¬
there shall not be any outside umpire. *
d. "To accomplish this, prepare a list of 30 to 40 represen¬
petent opinion on the facts.
(Special to The Financial Chronicle)
Also the troublesome question may develop as to the real part
tative Spaniards from all political trends, and from all walks
which France is playing in the situation.
DENVER, COLO.—Thomas
Perhaps Madrid's charges
of Spanish life (labor, army, universities, agriculture, industry,
Wallace is now associated with
that Moscow is affirmatively fomenting aggression, and together with
finance, etc.).
Invite them to meet—for the moment without
Central Republic Company, 209
France is planning military intervention to establish itself on the
the press, but keeping complete records to be published im¬
South La Salle Street, Chicago.
Iberian peninsula, should and will also be investigated. In any event
mediately thereafter—for carrying out the assignment of inves¬
Mr. Van Kleffens, Netherlands delegate, has already openly stated at
tigating whether there is a sufficiently broad basis for a tran¬
(Special to The Financial Chronicle)
sitory government capable of assuring peaceful evolution toward
the Council table that France's closing of the border was unilaterally
DENVER, COLO.—Charles B,
a normal parliamentary regime.
motivated, was not provoked by Spain, and that Dr. Lange's estimates
Elder has become connected with
of Spanish troops in the vicinity are materially exaggerated.
If
"In this conciliatory assembly, the votes should not carry any

Russians will bbjefct'ilto >the admittance -

itself

Recommendations

be summarized as follows:

Franco.

International peace and security?

raise

solution applied to

"The

(3) If the answer to question (2) is "yes," is the/continu¬
of the situation likely to endanger the maintenance of

can

Broker-Dealer

phere' into efficient collaborators in world reconstruction,

might lead to inter¬

commission is

world

promising normalcy.

level, it could find in the Spanish question an interesting test for
a new political device capable
of gradually transforming countries
from allegedly being 'disturbing factors in the international atmos¬

ance

While the idea of an investigatory

the

"If

the juris-

diction of Spain?

t'Tbe explanation; is simple; lack' of moral authority / by the,
Moral authority is,the only real weapon it" the .unlim¬
ited disposal of the UN»
Two conditions are prerequisite to its
efficient use: purity of intention and equality of application.
Spain
is ill.
Many other countries are ill.
The alternative to a total
abstention by the UN (which an enormous majority of Spaniards
deem dangerous) is the application of a remedy, adapted to the
illness.
The illness is the physical and political incapacity of Span¬
iards to meet and peacefully discuss the transition from the present
impeachers.

it well may
the Spanish
step toward
this body is
doing otherwise than play¬

the subject develops—as
—seems that, like the Persian portion of the agenda,
controversy may constitute a second crucial, if forensic,
^ultimate catastrophe.. For how can it he assumed that
such thorough exploration of

quantitative importance; only moral influence shall count.

Earl M. Scanlan

Co., Colorado

He was**
6. "One condition, however, is indispensable from the very
Simons,
beginning: as the ghost of civil war will overshadow the first meet¬ Roberts & Co.
ings and hamper the establishment of a basis for consequent dis¬
merely putting on a show in a vacuum, or
cussions, Spanish pride must, on all sides, undergo the ordeal of
(Special to The Financial Chronicle)
ing with fire?
'■frv
V''
g:
s!:
$
humility.
Both sides are stained with blood; regardless of which
DETROIT, MICH.—Carl G. Fair
side has suffered most, each must forgive.
Such
a conciliatory is with Carr &
Company, Penob¬
In any event, under the neat guise of ideological representations
assembly would make no sense if the Spaniards accepting the scot
for the benefit of the UN's audience, there are the realistic political
Building.
suggestion to take part in it do not seriously attempt to clear their
motivations behind the discussion.
On the one hand Moscow unheads and hearts of civil war souvenirs and prejudices.
(Special to The Financial Chronicle)
doubtedly wants to grasp the present opportunity—while the grasp¬
7. "Is this possible?
At first sight, every one must answer
DETROIT, MICH.—Harvey C.
ing is good—to extend its influence to the Atlantic. On the other
NO!
Nevertheless, after thinking it over, we must realize that the Rheume and Lewis Rowady are
hand, London and Washington, irrespective of their dislike of Gen¬
civil war which Franco officially declared over on April 1, 1939 now with Charles E. Bailey & Co.,
eral Franco, don't want a Communist regime to replace him also.
has not been terminated.
After seven years of failure, all Span¬ Penobscot Building.
; And although Mr. Cadogan may not hand out a free geography lesson
I
iards, within and without the country, must turn their eyes to some
in the Bronx, England assuredly can't have the Soviet at Gibraltar.
(Special to The Financial Chronicle)
The definition of ''Fascism" may be obscure, but not in the least so is other solution.
8. "The most difficult position will be that of the extremes.
the London-Moscow concept of geography.
DETROIT,
MICH.—Harry
J,
has joined Chapin
&
Also is there the political motivation behind France's attitude, Franco and his Falange on one side, Dr: Negrin and his Communist Murphy
Penobscot
Building,
and her apparent joining of the Russian-Polish team here—reflecting friends on the other side, would—if their love for Spain is as strong Company,
and as pure as they claim—be obliged to facilitate the meeting after serving in the U. S. Army
the growing encroachment of the Communist influence in French in¬
**
of our proposed assembly and later on help to prepare the list for Air Forces.
ternal affairs. Conversely, the Vatican's influence against the Com¬
a
very broad government capable of giving the
Spanish people
munists must be weighed as a most important factor with political
(Special to The Financial Chronicle)
every hope for a peaceful democratic recovery.
effects.
'«
National Bank Building.
in the past with Sidlo,

opinion whether

DETROIT, MICH.—Michael AI-

Spaniards are able to help themselves.
If Franco or
Giral's government, or both, would oppose our assembly, world

bery and Murray S. Reid are now
connected with C. G. McDonald &

tji

Our Yugoslav

not

Parallel

The domestic agitation for us to break off diplomatic

relations
both
such
relations there, as well as now with the distasteful Tito regime. In
recognizing the Tito Government in Yugoslavia, and accrediting Am¬
bassador Patterson there, the State Department's note last week stated:
"In the circumstances, the United States Government desires that it
be understood that the establishment of diplomaic relations with the
present regime in Yugoslavia should not be interpreted as implying
approval of the policies of the regime, its methods of assuming con¬
with Spain must be seen in the light of the policy which guided
President Roosevelt and our present Government in maintaining

Mr.

"This

show world public

assembly would

the

public opinion would know where the difficulty lies, and would
the moral authority it lacks today to enforce its solutions.
The sa mecould be said if other Spanish groups would intransigency

Co., Guardian Building.
•

have

show to the
10.

dream

DETROIT, MICH.

assembly.

will say that the proposed scheme is a fantastic
stupid suggestion. What will the objectors say if such a

"Many
or

Murley

Jv*«

Evans

—

and Harry M.

Perry

are

connected with Slayton & Co., Die,
I

plan is the only alternative to the perpetuation of the 'Spanish
disturbance,' which is doomed to lead to another civil war?
If

(Special

Chronicle)

to The Financial

DETROIT,

MICH.—Joseph

it Collins has
rejoined Watling, Lerthe Spaniards the chen Sa Co., Ford
Building, after
way of reasonableness without hurting their sense of liberty.
promised its people."
serving in the U. S. Army.
*
$
Jj:
O
"Spain has given so many proofs of speedy recovery that it can
(Special to The Financial Chronicle)
A Proposal by Spaniards to Settle Their Country's Affairs
surprise the world again, a world so chained in darkness that it
In the opinion of a group of leading Spanish citizens residing cannot afford to wilfully blow out the thinnest ray of light."
HARTFORD, CONN.—Leo V*
*
*
%
#

trol

its failure to implement the guarantee of personal freedom

here, the UN's proposed plan for

world

opinion agrees as to the necessity of such an experiment,

five-member Committee to inves¬

Dubey is with Cooley & Co., 109

On Understanding the Soviet
A

Pearl Street.

good example of Russia's current befuddlement

of her good

of Emil Rieve, general president of the
J government on a broad base representing all legitimate interests Textile Workers Union of America, CIO,' delivered recently be¬
to run the country during transition back to democracy. They feel that fore the Foreign Policy Association. After criticizing us for our 1917the weight of world opinion resulting from the prestige of such a 1933 ostracism of Russia, he stated that "Russia herself contributed
group would be effective in overcoming all opposition.
to this relationship by her preachment of world revolution and by
Here is a "prospectus" of the plan as given to your correspon¬ the antics of Communists in this country and in other countries,"
dent, and submitted, without further comment, for whatever interest Getting down to the present, this sympathetic CIO official continued:
"Russia now chooses
throw her weight around. .„«•. « Where/does
it may merit:
5 1. "A workable compromise on 'Spain' based on a UN Committee securityTeiid, ^d^aggressioh^hegihZ^7;frv/the Balkans, Manchuria
of Five to investigate the justification of the Polish indictment is andj Turkey, the Soviet is playing poker, using for chips the seeds
MiUtancypwould appear to be the official policy Of the
impossible.
In the Russian-Polish game, why is Spain doomed to of-war.
be the ball?
Spaniards and the whole world must realize that Soviet Union in franj in the Balkans, in Poland, and in Manchuria. %
Spain and draw specifications for

representative

friends is seen in.a speech

the

UN cannot

ested

mean

serious business; that

the USSR is not inter¬

consolidating World Peace, but in spreading World-wide

Civil War.

"The facts

supposedly to be investigated by the UN Committee~-Franco's flirtation with the Axis, his persecution of political
2.

how indisputable
your right to have it, you don't get it by marching armies into the
country where it is. Not if you want peace, you don't. Neither oil

irt'No

nor

matter how much you need oil, no matter

the need for

ice-free port or a buffer state can

belligerent attitude in Iran or
enemies^ the totalitarian tendency of his economy, the lack of free¬ Security Council because the
dom of speech, of free elections, etc.-—are either universally known, facts of the Iranian mess, v
or irrelevant,
or have lost all historic importance, or cannot be understand other nations and
.

justify Russia's

its stalking out of the United Nations
rest of the world wanted to get the
How can the Russian people learh to
develop a realistic foreign policy and

(Special to The Financial Chronicle)

y
'

HARTFORD, CONN.—Harold V, 1
Lalley has become affiliated with
43

Pearl

today, and a little more
.

desperately helpless,:,

and what their leaders

are

saying?*

Street.

with

was

Maples & Goldschmidt in the past,
'

■

i:i V'A
vt;

•

\ V-.--.#

• '

:r*.£?;>*•.;«<* '• ~-v\••

(Special to The Financial

-7

Chronicle)

HARTFORD, CONN.—Clarence
G, Jeffers has been added to the I
staff of Henry C. Robinson Sa
f

Company, 9 Lewis Street.

Vt (Special to The Financial Chronicle)

INDIANAPOLIS, IND.—Arthur
M. Ramer has been added to the
staff of Indianapolis Bond & Share

Corporation,

129

East

Street.
-

the UN as a basis for; any attack against Spain.: , At'thea-sense of world history, if they cannot find j^n their .own newspapers
the investigation we shall be no better informed than we are factual
—a- uf^what othSY'riations are doing

Paine, Webber, Jackson & Curtis,

Market/1
■

(Rnecfa) to .The

taken by
end of

surely must find an efficient means of showing

tigate the situation on the spot must be abortive. They hence have
worked out a plan for a body of 30 or 40 Spaniards of all factions
to meet outside

Chronicle)

(Special to The Financial

Financial

Chronicle)

INDIANAPOLIS, IND:—William
A.

Neal

has

become

connected

tVolume 163
4

4-.

Number 4484

THE COMMERCIAI^& FIMNCIAi; CHRONICLE;},

l&r'-:.

with Merrill
Lynch, Pierce, Fen-

ner & Beane, Circle Tower.

(Special

The

KANSAS

Financial

CITY,

Chronicle)

MO.—Thomas

A. Marnell has become
associated
r with
B. C. Christopher &

Co.,

Board of Trade
Building.

(Continued from

He was
with Prugh, Combest &
Land, Inc.

I: formerly

KANSAS

CITY,

offer them

never

tomer is

Chronicle)

Myers, and Thomas
become

associated

Waddell
more

Herrick,
1012 Balti¬

KANSAS CITY, MO.—Leonard
II. Van Home is with Merrill

Lynch,

Pierce,

of New York

(Special to The
$

KANSAS

Fenner

Beane

City.

CITY,

issues.

Chronicle)

Company, 3 West Tenth Street,
after serving in the U. S. Army.
to

The

Financial

LINCOLN, NEB.—John
tier

with

F. War-

Cruttenden

Co.,

First National Bank Building.

insiders) they are doing

proposed rule to protect the
holders of

Chronicle)

I LINCOLN, NEB.—Louis

'; (Special

to The

LINCOLN,
Graham is

Financial

now

pectation of

speculative profit have

now

general
public, his name was
linked with that of Adam
Smith.

NEB.—Harold

affiliated with E.

now

^E. Henkle, Jr., Investment

issues for their

own

It may and
may not

account.

good policy to permit this sort of thing. Each
just

facturer when he is in

old
one

Com¬

DEALER NO.

manu¬

2469 Collins Avenue.

interest.
cases as

not able to

get

I'd like to and in

some

big

fied because the

/ OSBORN, OHIO—Jesse II. Zabtiskie is with Slayton & Co., Inc.

one

offering has been

I get none.

see

However,

my customers satis¬

a success,

than get

and find the opposite is the case which
may

public

allotment in many

cases

I'd rather get a smaller allotment and
Chronicle)

ated

with

Putnam

Co.,

Inc., 97 Exchange Street, after
serving in the armed forces.
(Special to The Financial Chronicle)

PORTLAND,

OREG.—Jack

Danby has become connected with
,

Conrad, Bruce &

proposed rule. I'm not against it

larger

be true much

halt deflation. He visited Presi¬
dent Roosevelt at the White
House

spending policies.
During the war,

Chronicle)

Brothers, Security Building, after
serving in the U. S. Army Air
Forces.
(Special to The Financial

ST.

LOUIS,

Chronicle)

MO.—Alonzo

Stark and Paul Wiesner have be¬
associated with Edward D.
&

Fourth

Company,

Street.

Mr.

300

North

Wiesner

was

in the U. S. Navy. Mr. Stark is re¬
joining the firm after serving in
the Army.
■

(Special

J: ST.

vitally interested in
mind the wrong

Chronicle

ter and William S. Simpson have
become associated with
Newhard,
Cook
&
Co., 40(L™ Olive* Street,
after serving in

t^ ^rmfid. forces,

(Special to The Financial Chronicle)

done to

the

(Special

The

Financial

—

permit

terms

h^s to
as

the

NASD

keep

such

individual, AND then he has

Chronicle)

SWANTtiN,OHIO--J.

Blair

(Clay is with Slayton & Co., Inc.

opposed to such

they should

ting firms

can,

and take orders

Roanoke, Virginia,
NOTICE

The

1946.

ANNUAL MEETING
STOCKHOLDERS

Annual Meeting
and
Western

of Stockholders

Railway Company
held, pursuant to the By-laws, a*
the
principal office of the Company i«
Roanoke, Virginia, on Thursday, May
1946,

Directors

o'clock

for

business
to

vote

April
at

term

Stockholders

A. M.,

record

19,

such

1946,
meeting.

elect

four

three

years.
the close

will

opening for

experienced

Co.

Broadway, New York5,N.Y.
So. LaSalle St., Chicago 4, III.

public

pay more, as

Secretary.

EX-SERVICEMAN
15

regular quarterly dividend
per share on the 5%

Convertible

($25.00

Preferred

•

illustrated.

Years

experience

listed and unlisted securi¬

Stock

ties,

value) has been de¬
clared payable June 1, 1946, to
stockholders of record May 15,
1946.
M. E.

Desires position with

par

GRIFFIN,
Secretary-Treasurer.

New York Stock Exchange

firm.

Box N 425, Commer¬

cial

Financial Chronicle,

[|2ju Park Place, New York
8, N. Y.

-L-i

INTERNATIONAL

ffrrrH

HARVESTER
COMPANY
i

Quarterly dividend No.
Ill
of
one
dollar
seventy-five cents
($1.15) per share on
preferred stock payable June 1, 1946, has
been declared to stockholders of
record at t'he
close of business: May 4, 1946.
v:-;

SANFORD B. WHITE
Secretary

Si"

Attention,
Investment Dealers!

the

EXPERIENCED

SECURITY

ANA¬

LYST,

rule.

advertise.. forthcoming issues in

SITUATION WANTED

WOODALL

.more

detail

during the 20-day "incubation period."

THE

The

April
share

UNITED

Board

24,
oil;

1946,
the

1946.

able to write sharp-minded
up-to-date analyses of bank, indus¬
trial and railroad stocks, available for
individually paid analyses^ and for
answering your mail inquiries. Write
Box
L-43, Commercial & Financial

CAMERON, Treasurer.

Chronicle, 25 Park Place, New York 8,

1946.

N. Y.

STATES

Directors

declared
Class

LEATHER
at

meeting

dividend

stock,

CO.

payable

1946, to stockholders of record May 15,
,

-v.-

•

,,-C.

New York, April 24,

held

500 per
June

15,

Hiir'-'T

iin!

n—

entitle*

MEMBERS
York<i Stock Exchange

instructed in writing.

INDUSTRIES, INC.

231

and

sense
"

If SEC wants to help in¬
have Securities Act amended so distribu¬
a

April 5,

Norfolk

will

New

to add his

broad

"-r-

DEALER NO.

vestors
(Special to The Financial

MEETING NOTICE

TRADER

go into market to buy that security on

liam J. Hartt is with Hornblower

were

Govern¬

NORFOLK AND WESTERN RAILWAY
COMPANY

Ernst

1,298,200

J. J. MAHER,

the word, and also makes the

which

120

concessions, isn't it only common
sense that
they lose the distribution power of the nonmember dealers,
AND, isn't is also a fact that then the
non-member

by the British

and other
leading Security and Commodity Exchs.

being). Well, I also note that SEC wants, as
trades put through as possible on a commission basis.

Wil¬

£ Weeks.

features

adopted

ber 31,

into

Chronicle)

MASS.

His
book, "How to Pay for
War," published in 1940, advocated
a
drastic "forced savings"
plan,

the

This is a
BOOMERANG, I say. You will recall that I
called it unfair for NASD to make its
Members gang up on
non-members (friends of theirs in business
before NASD

and also hurts distribution of securities in

i SPRINGFIELD,

per

Company unless otherwise

;

.Hi

attracted wide attention later
that
year with publication
of "Eco¬
nomic Consequences of the
Peace,"
in which he predicted
dire, result*
from the peace treaty.

mailed

non-members, other than like
public, in other words, no concessions.

delegation, \butJteK

because of disagreement
with some proposals. His criticism
of the German
reparations policy

York, April 23, 1946.
dividend of Seventyshare

(75c)

profits of
Company for the fiscal year ended Decem¬
1945, payable on Saturday, June 15,
1946, to stockholders of record at the close of
business Wednesday,
May 15, 1946.

security

MdSfEran^G. Sif* pfbfft- omtop ofS&Sounds
silly to me to permit such a con¬
John M. Dean are with
& Co., lliU»vill North! cession pde, to gfist for it makes bad friends amongst dealers

JSlayton
Fourth Street.

British

Familiarity with Foreign Ex¬
change and leading European
required. ;We
are
particularly interested in
ap¬
plications from younger mei*.

Cents

with the

same

the

signed

markets

regular quarterly

Checks in payment of this dividend will be
to all stockholders of record at their
addresses as they appear on the books of the

GANGING-UP rule

con¬

ARBITRAGEUR

shares of Common Stock without
par value of
Southern Railway Company, has
today been
declared out of the surplus of net

section of this for it bears out to
my

ST. LOUIS,

ley and

five

be not allowed to deal with

many

to The Financial

New
A

NON-MEMBER of NASD,

was formed) made it a rule
that,
syndicate and allied distributions, their NASD
members,

ever came

was

L. W. COX. Secretary.

Railway
Company

industry in having (when it
on

From 1915 to 1919 he

Southern

that the NASD has

However,; if .they

LOUIS, MO.—Loren L. Clus¬

one

1905,

FOREIGN

but when is this sort

firm,

however, his

DIVIDEND NOTICE

graduated

was

nected with the British
Treasury,
In 1919 he attended the Versailles
Peace Conference as a member of

against this

arms

business?

come

Jones

per se

DEALER NO.

LOUIS, MO.—Christopher
J. Muckerman, Jr. has joined Hill

Keynes

Cambridge

We have

and
joined the civil service in the
India Office. After two
years he
returned to the university.

im¬

6
up

Co., 316 South

ST.

Lord

from

was

Keynes

HELP WANTED

and more on
management's pre¬
rogative until the life-blood is completely sucked from our

I, meaning
m

with

portant role in shaping New Deal

thing going to stop? Are these regulatory bodies going to

West Sixth Avenue.
(Special to The Financial

international

credited

Baron

Tilton in 1942.

views.

was

first

DIVIDEND NOTICES

DEALER NO.

industry should be

continue to encroach

which had wide influence. He

created

British

unorthodoxy of his
During the de¬
pression he became a leading ad¬
vocate of government
spending to

and

attendance^ at

monetary confer¬
during the last 25 years and
his authorship of several books

frequently if proposed SEC rule is promulgated.

The whole

economic

the

delegation to the Bretton Woods,
N.
H., monetary conference in
1944, and was co-author of the

(Special to The Financial Chronicle)

PORTLAND, MAINE —Frank
II. Fenderson has become associ¬

other

headed

international fig-

his

•:

world

ences

ment.

through

various

world bank.
Lord Keynes first
attracted at¬
tention by the

rule is not in the

He became
ure

lend-lease
matters.

spending

should seek to slow
down inflationary tendencies.

some

and

government

lowing:
He [Lord
Keynes] made a num¬
ber of trips to the
United States
during the war in connection with

economic

I operate a retail firm but such

MIAMI BEACH, FLA.—Morton
is with Bache & Co.,

(Special to The Financial

seller's market. Some favor distribu¬

full employment
aim of financial

patrons. There is nothing crooked about such practices basic plan for an
monetary fund and
way or another.

(Special to The Financial Chronicle)

protagonist of the the¬
makes

From London Associated Press
advices April 21 we take
the fol¬

has to de¬

one

does any merchant

that

the
overriding
policy.

nothing unethical or wrong in a firm permit¬
ting member of their own organization to take down shares

pany, Federal Securities Building.

Flterman

was

ory

new

on a loan to
Britain. Noted as a
political and social economist who
influenced both
specialists and

3-point loss.

mes¬

husband at his death. The
London

ex¬

approximately

Firle,

message went on to say:
Lord Keynes was ill when
he
returned in December from
the
financial talks in the United
States

same

ting available supply of goods equitably to old customers,
some
try to get new accounts by serving them at expense of

Chronicle)

brought

Savannah, he returned to
fortnight ago, tired and
Lady Keynes was with her

ill.

Corporation. As a
wafbffered at 20 lA to the public,
selling 14 lA bid, 15 V4 asked. Those dealers, partners

cide this for himself

Hol-

world

2218)
on

shifted with changing circum¬
stances, and he argued that the

restoring

war

page

views

ence

Britain

trading accounts and stock¬
investment organizations from
taking a trimming

W. Mc¬

Lennan has rejoined Ellis,
jyoke & Co., Stuart Building.

Lord

that,
by the strain of the
International Monetary Confer¬

and stockholders who subscribed for this stock
with the

(Special to The Financial

York

that

exhausted

There is

Chronicle)

New

work for

Sussex. His age was 63. The
to the "Times" added

DEALER NO. 4
(Special

the

stated

sage

case

I would like to call
your attention to the fact that these
markets operate both
ways. There is nothing stated in this

it is

MO.—Philipp

was

him world-wide
influence, died of
heart attack at his home in

the New Deal sponsored Kaiser-Frazer
matter of record this stock

Kuhn and Robert E. Weiss have
rbecome affiliated with H. O. Peet
>

ments to

Financial

(allot¬
good turn to investors.

DEALER NO
Chronicle)

new

not in love with the SEC but in
this

are

Avenue.

Financial

the economic structure of
twice shattered

DEALER NO. 2
We

Ray have

with

Co., Inc.,

(Special to The

London1

Times

evaluation of the market has resulted

con¬

I!
wireless message April 21,

from

Grover C. Gresham,
Ilartung, Jr., George II.

attractive stock—Result: Cus¬

existing method of selling

MO.—Edith

ferences.

Keynes, whose

erroneous

in the

(Continued from

2215)

page

Keynes, Holed Economist, Dies Suddenly

mist in various international

lost;

Freedman,
Paul

Lord

Dealers7 Views on SEC's Proposed
Ban on Allotments to "Insiders"

THE COMMERCIAL & FINANCIAL

2262

<*■

Thursday, April 25, 1946

CHRONICLE

Securities
J%

m<iiO

(4/29)
100,000 shares class A stock (par $1) and

Air Products,

Inc., Chattanooga, Tenn.

•

new

(4/29)
March 14 filed 30,000 shares of cumulative preferred
stock, 4V2% series (par $50) and 20,000 shares of com¬
mon
(par $2.50). Underwriters—Central Republic Co.,
Inc., and Reynolds & Co.
Offering—Prices to public
by amendment., For details see issue of March 21.

share.. Remaining 40,000 shares common are being

certain officers and em¬

ployees at: $1 per share and are not underwritten. Pro¬
ceeds
$60,000 to purchase machinery and equipment
heretofore rented from Defense Plant Corp.; $81,500 to
—

purchase of plant at Emmaus, Pa., together with $70,000
for cost of conversion and moving; balance (estimated

$913,500) for general working capital.

Altair

•

April 19 (letter of notification) 1,377 shares of common
stock.
Price to public $100 per share.
No underwriters.
To increase buying power of the company and to transact

(Ont.)

(5/6)

American Acoustics, Inc., New

April 9

Barium Steel

Wash.

For details see issue of March 21.

American Manufacturing Co., Inc.,
Ala.

Montgomery,

April 5 filed 1,000,000 shares of common (par $1). Un¬
derwriters—No underwriting—to be offered directly to
the public by the company.
Offering—Price to public
$1 per share. Issue will be sold within State of Alabama.
Proceeds—Acquisition of, additional machinery, working

capital, etc. For details see issue pf April 11.

March 29 filed 21,550 shares of 4Vz% cumulative con¬
vertible preferred stock (par $50) Underwriters—G. H.
Walker & Co.
Offering—Common stockholders may
I subscribe to new preferred at rate

share of pre¬

one

ferred for each four shares-of common held at
share.

$52

per

Unsubscribed shares will be purchased by un¬

with a term

derwriter* ft Proceeds—Proceeds,' together

$1,250,000 and current funds will be used to
finance the purchase of a plant formerly belonging to
the Defense Plant Corp. *for $1,750,000, purchase of ad¬
ditional machinery and equipment and for other plant
improvements.
For details see issue of April 4.
loan

'
Amerian

' C:;

•
Inc.,

•.

Water Works

Co.,

N. Y.

March 30 filed 2,343,105 shares of common (par $5) plus
an additional
number determinable only after the re¬
sults of competitive bidding are known.

Underwriters—
To be; filed by amendment.
Probable bidders include
Dillon, Read & Co. Inc., White W*ld & Co., and Shields
& Co. (jointly), and W. C. Langley & Co. and The
First Boston Corp. (Jointly).
Offering—Price to public
by amendment. Purpose—The common stock, together
with $15,000,000 10-year 3% collateral trust bonds (to
be sold privately) are;*to,?beft issued ^to acquireieertain
assets of American Water Works &

Electric, .liquidate
subsidiaries, - Communityv Water Service«Co. and
.

two

Ohio Cities Water Corp*, and provide cash working
tal.
Common stock is to be offered initially for

capi¬

cash
public holders

common

preferred stocks of Community and Ohio in exchange

stockholders of parent and to

for their shares.

Stock not subscribed

stock (par 50c).
of the estate of
Vincent Bendix, deceased.
Underwriters—Kobbe, Gearhart & Co., Inc., For details see issue of Feb. 20.
Bendix Home

Appliances, Inc., South Bend, Irid.

104,301 shares of common stock (par
33J/3 cents per share).
Offering—Common stocks hold¬
ers of record March 30 are given the right to subscribe
to one share of new common for each 10 shares held,
March

$17

Issue

share.

per

issued under

exchange offers are to be sold for cash .tounderwriters.'
For details see issue of April 4.

being

underwritten.

Corp.,

Wilmington,

not

For details see issue of March 28.

Beneficial

•

Del.

Loan

Industrial

(5/7)

18 filed $20,000,000 15-year debentures, 100,000
preferred stock (no par), and 400,000
shares common stock (no par).
Underwriters—Under¬
writing group for debentures and preferred stock is
headed by Eastman, Dillon & Co.; Offering—The 400,000
shares of common stock is to be offered to holders of
common stock for subscription at $12.50 per share, on
basis of one share for each five shares held. 1 Offering
of common stock is not to be underwritten.
Price to

April

shares cumulative

preferred stock will be filed

by arftehdment.
Proceeds—Of net proceeds, approxi¬
mately $17,400,000 'are to be used to redeem 10-year
2y4% debentures and 15-year 2%% debentures and
the balance is to be placed in the corporation's general
funds.
It is the present intention of the corporation to

bank
Business—Corporation is
a
holding company, the subsidiaries of which are en¬
gaged in the small loan business, the acceptance busi¬

use

portion of such funds to reduce outstanding

loans and

ness

and

$250,000, and
glass containers.

eral line of

Capitol Records, Inc.,
28

issue of
•4

filed

commercial paper.

the

passenger bus

business.

April 4.

of common

ft-

for the common stock

(EDST).

•

from

five

Of the 852,302 shares,

stockholders.

150,000 were sold privately at the cost price to Allen
& Co.
Purchase price to Allen was $2.10 per share.
Offering—Price by amendment. For details see issue of
March 21.

$4,800,000 convertible sinking fund de-(%
bentures due June 1, 1961.
Underwriting—First Boston |
Corp;
Offering—Company is offering to holders - of /
common stock of record May 17, 1946, the right to subr !
scribe for the debentures on the basis of $500 of deben-> .
tures for each 100 shares of common stock at a price I
19 filed

Unsubscribed debentures |
offered the public at ft
a price to be filed by amendment.
Proceeds—Proceeds |
will be added to working capital.
Company expects "ft
that out of working capital after the addition of the net j
proceeds from sale of the debentures, all notes payable
(outstanding on April 30, 1946, in the amount of $1,000,- j
000) will be paid and an amount equal to the remainder^;
of the net proceeds will be applied to the improvement ft
of properties now owned or hereafter acquired. Business
—Investing in real estate, principally real estate located

filed

amendment.

will be sold to underwriters to be

in the

City of New York.

Clinton Machine Co.,

•

shares of $1.20 cumulative pre¬
ferred stock (par $25), with common stock purchase
warrants attached.
Underwriters—Blair & Co., Inc.,
New York.
Offering—Price to public by amendment.
For details see issue

of March 28.

Brockway (Pa.) Glass Co. Inc.

(5/13)

Clinton, Mich.

April 18 (letter of notification) 100,000 shares ($1 par).' ;.
Price to public $2 per share.
Underwriters—Smith* j
Hague & Co. and F. ;H. Roller & Co., Inc... Proceeds— ft
Retirement of debt and for working capital.
*
!

■

Columbus

(O.)

Southern

•

•'&!

'7'.-

•

ft:;":';.;,

April 19 filed 744,455 shares of common stock ($10 par),. f
Shares are issued and are owned by Continental Gasft,
Corp. which is selling them. Underwriters-^by amendment.
Offering—Shares will be ft
offered for sale by Continental at competitive bidding »
& Electric

filed

the

and

price

to public will be filed by

amendhient^j

Proceeds—Proceeds will be used by Continental to reV
bank

duce

Probable

loans.

bidders

include

Lehmart

Brothers; Dillon, Read & Co. Inc.; Smith, Barney & Co.;
Kidder, Peabody & Co.; Mellon Securities Corp.
;
Colorado Fuel & Iron Corp., Denver, Colo. (5/1)

Commercial Capital Corp., N. Y.

•

(4/29)

public $50 per share. Company proposes to distribute
securities by offering them to persons living in
Brockway and surrounding communities.
Proceeds—

by the corjporation at! $25^per shareft Proceeds-rEnl^rg^ ]
ing^^ compepy-S Jj^siness in factoring,field;/, 5
Tft. *

the

tiye

-pl^e^cd^tqc^; (pauT $25). Offering—To "be offered \

SPECIALISTS IN

—

Underwriters and Distributors

United States Government Securities
State

:ir

and Municipal

5 \

INC.,
48 WALL ST.,

CORPORATION

Bonds

Chicago

Chicago and other cities

•

NEW YORK 5, N. Y.

Boston

Cincinnati

☆

if
S-|.:,

DEVINE&CO.

C. J.
FIRST BOSTON

•

ft;ftft "ft^ ftft ftSftftft-'

•

NewYork > Boston

;•

April-19 (letter of notification) 4,000 shares 7% cumula-r

Corporate and Public Financing
■ft ft* A

of common stock (no par).
Shares are being sold by/ certain stockholders.
Under¬
writers—Hirsch & Co.
Offering—Price to public "at<
market" on the New York Stock Exchange.
.
;
March 14 filed 275,000 shares

April 24 filed 10,000 shares 5% cumulative preferred
stock (par $50). Underwriting—None.
Offering—Price

—

■

Electric Co.

Ohio

Ind. (5/3)

Bowser, Inc., Fort Wayne,
March 25 filed 200,000

(5/8)

City Investing Co., New York

April

☆

"~vr"

»■»

♦

18 filed 220,000

(5/8)

Manila, P. I.
March 15 filed 702,302 shares of capital stock value
(par 1 peso, equivalent in U. S. currency to 50 cents
per share).
Underwriters—Allen & Co. The shares are
part of a total of 852,302 shares purchased by Allen

•

'•

•

••

and 3:00 p.m.

•

Benguet Consolidated Mining Co.,

Co.

110,000

Co., Augusta, Me,
s
|
shares of preferred stock ($100*1
par).
Dividend rate by amendment.
By amendment; |
filed March 29 company proposes to issue $13,000,000 1st *•
& gen. mtge bonds series N due 1976 and 1,000,000 shares ? J
common (par $10). Securities will be sold through com-^f
petitive bidding. Underwriters—By amendment. Probable |
bidders include Glore, Forgan & Co.; W. C. Langley &
Co.; The First Boston Corp.; Coffin & Burr; Harriman>^
Ripley & Co.; Blyth & Co., Inc., and Kidder, Peabody ft
& Co. (Jointly).
Offering—Company will offer to hold*$ J
ers of 7% preferred, $6 preferred and 5% $50 preferred
stock right to exchange such
stock on the basis of one ^
share of new preferred for
each $100 par value of old
preferred plus a cash adjustment. Balance of new preferred stock will be sold to underwriters, to be selected
by competitive bidding.
Bids Invited—Company willy
receive bids up to May 7 for the purchase of the bonds, ■
preferred stock and common stock. Bids will be accepted
up to II a.m. for the bonds, Noon for the preferred stock*
March

Hollywood, Calif.

stock (par1*!
25 cents). Shares are being sold by stockholders (15,000
|
shares) Blyth & Co.; Inc., and Union Securities Corp.
(47,500 shares each). Underwriters—Lee Higginson Corp. >-.%
Offering—Price to public by amendment. For details see^.|

March

filed

public jot debentures and

Providence, R. |. (5/1)

American Screw Co.,

Inc., New York

Bendix Helicopter,

March 11 filed 49,602 shares of common stock (no par).
Underwriters-r-Blyth & Co., Inc.
Offering-^Common
stockholders given right to subscribe for 49,602 shares
at $20.50 per share on basis of 48/100 of a share for
each share held.
Unlikely new stock will be available

■

development,

repayment of loans,
issue of April 4.

Feb. 13 filed 507,400 shares of common
Shares are being sold for the account

and to pay Pressurelube Incf for inventories and other
property acquired from it, working capital, etc.

distribution.

For details see

etc.

for public

subsidiaries for working capital, for pur¬

of equipment,

chase

(letter of notification) 59,800 shares of 6%

Proceeds—Payments to and

public by amendment.

advances

cumulative convertible preferred stock (par $5) and
59,800 share? of common stock (par 10c); 100,000 stock
purchase warrants and 149,500 shares of. common to be
issued upon conversion of preferred at rate of 2^ com¬
mon for 1 preferred.
Underwriters—L; D; Sherman* &
Co, Offering—Stocks to be offered in units of one share
each at $5 per unit.
Warrants will be sold at 1 cent
each.
Proceeds—Payment of obligations to be assumed

Corp., S. E. Canton, O.

350,000 shares of common stock (par $1).
Underwriters—Laird, Bissell & Meeds.
Offering—Price
March 30 filed

York (4/26)

American Mail Line Ltd., Seattle,

greater volume of business.

April 17 filed 179 units.
Underwriters—Charles M,
Levett, Summitt, N. J., who is to act as agent in the
United States.
Offering-rrPrice to public is $50 per
unit.
Proceeds—Development and exploration.
Business—Prospecting mining claims.;
.;

with proceeds of *f
building, $525,000;. /,
leased equipment,
k
working capital, $400,000. Business—Gen-^|
to use proceeds,

proposes

Central Maine Power

Associated Grocers Co. of St. Louis, Mo.

•

For details see
\
.

Prospecting Syndicate

Equipment Corp., Bryan, Ohio

Aro

ft.

$1,250,000 as follows: new
and used equipment, $575,000;
of

loan

are

J
•

•

Company

Blytheville,

(5/12)

150,000 shares will.be offered at discretion of un¬
derwriter to purchasers of such units or to others at $1

issue of April 4.

Corp.,

Power

ISSUE

filed 40,000 shares common stock (par $5).
being sold for the account of five stock¬
holders.
Underwriters—G. H. Walker & Co. and Ed¬
ward D. Jones & Co.
Offering—Price to public by
amendment.
Business—Public utility.

April

mon,

offered by company directly to

Arkansas-Missouri
Ark.

April 2 filed
290,000 shares common stock (par $1). Underwriters-^
Reynolds & Co.
Offering:—100,000 shares of Class A
stock and 100,000 shares of common are offered in units
of one share of each at $11 per unit.
Of remaining com¬

per

INDICATES ADDITIONS SINCE PREVIOUS

•

Registration

Now

Philadelphia
»

St. Louis

•

Pittsburgh.

Corporate and Municipal
Securities

;

j-.

v' •

Kidder,PcabodySf Co.
.

HAnover 2-2727

San Francisco

,,!>s,

Cleveland
☆

Members of the

Nevv York

Founded 1865

New York arid Boston Stock ExcJianges

Boston

Philadelphia.

Chicago

;

1 v'i4;,

■

Compania Litgrofica De La Ha6MS. A. (5/15)

Cd^

(Havana (Cuba) Lithographing

con-

from

underwriters

stockholders.

certain

The

(Showing probable date, of offering)?' /.

re-

nainihg 35,000 shares of cdrhmdiY are beittg: purchased
the company.

k.
sue

Underwriters—Hirsch & Co., New
For details see

Sinclair Oil Corp..

Stromberg-Carlson

of March 21.

Gas

Electric

Underwriters-^-To

refunding mort¬
Interest rate by amend-

bidders include Halsey, Stuart & Co.,, Jnc.;
*arriman, Ripley'
C6'.;' ahd* Alesc.Brown: & Sens
Jointly); and White Weld & Co./ and W First B'oStetf
'utpy (jointly).
Proceeds—Redeniption. of = $20,$44,000
eries N 3%% bonds and $23,816,000 series O 3J/4 % bonds
t 105% and 107, respectively.
Bids Invited—Bids for

Sonotone Corp

(4/29)

100,000 shares common stock (no par).
being sold by certain stockholders.
UnderJters—Wertheim & Co. Offering—Price to public by
For details

/Curtis
rch

Companies

Inc.,

Clinton,

Common

Davidson Bros.

Inc

Common

(11:30 a.m. EDST)
Bonds
Preferred and Common

Common

L'Aiglon Apparel Inc
Morris Plan Corp. of America

Common

Preference

National Co.

Common

Samson United

Corp

—Preferred

Scranton Electric Co.

(Noon EDST)_Pfd. and Com.

Taca Airways

issue of Feb. 28.

Bros., Inc., Detroit, Mich.

pril lO filed 100,000 shares
hares

outstanding and

common

Veterans Air

(4/29)

stock

DeVilbiss Co.,

1946

American Screw Co

Preferred

Colorado Fuel & Iron Co.
De

Vilbiss

Pittsburgh

Corp.-

Common /
Common
——Common

Longines-Wittnauer Watch. Co.
Mercantile Stores Co., Inc
—
Common
Minneapolis-Honeywell Regulator Co.—Preferred

1946

May 7,

Beneficial Industrial Loan—Debs., Pfd., and
Central Maine Power Co.—
4

Bonds (11 a.m.);

Com.

Pfd. (Noon); Com. (3 p.m.)

Midwest Rubber Reclaiming Co.——Pfd. and Com.
Palmetex Corp.
Standard Steel Spring
Walworth Co

——Common
Preferred

Debentures and Preferred

May 8, 1946
City

Investing

Columbus

——Debentures

Ohio Electric

So.

-Common

Merchants

Distilling Cor|».^
—
Common
National Skyway Freight Corp
-—Common
Public Flyers Inc
————-Common

May 10, 1946
.Common

Hoffman Radio Corp

National Bellas Hess Inc

Common

Airlines, Inc

Diamond T Motor Car Co

Common

Hytron Radio & Electronics Corp

Common

Arkansas-Missouri

Bonds
Preferred and Common
Common
Puerto Rican Overseas Airways—s.
Preferred
Roberts & Mander Corp
Common

Power- Corp

May 13,

Preferred and Common

Keyes Fibre Co
Mortgage Associates Inc
Peerless Casualty Co.

1946

May 12,

—Common

Jefferson-Travis Corp

common

Corp.,

Federal Mfg. & Engineering

——Units
—-

Common

Co.—

Brockway

Common

1946
Preferred

Glass Co., Inc

May 15, 1946

Havana

Pfd. and Common

Lithographing Co

May 24,

Scranton-Spring Brook Water (Noon EDST)-^
Bonds and Preferred

Credit

1946

May 6,

Altair Prospecting Syndicate
Eureka Williams. Corp,—- ——-

May 11, 1946

stock (par $5). Underriters—Laurence M. Marks & Co., and Ball, Burge &
raus.
Offering—Price to public by amendment. Proeeds—Redemption of 7% preferred stock; plant expenitures and working capital.
For details see issue of
pril 18.
Dealers

.Preferred

Wallpaper, Inc.__———

Class B Common

May 1,

are

Toledo, Ohio (5/1)

pril 12 104,138 shares

Debentures

Express Co

(par $1).

being sold for account
f Certain stockholders.
Underwriters—Merrill Lynch,
|/6rce, Fenner and Beane, and Baker, Simonds and Co.
ffering—Price to public by amendment. For details
e issue of April 11.
are

United

—Common

United States Rubber Co

Davidson

Preferred

May 4, 1946

Gas, Elec. Lt. & Pow., Bait. (Noon)„Bonds
Corp Notes
Common

Greer Hydraulic Corp

per share to new stock at rate of one share of new
V each share held.
Company reserves right to sell
ny unsubscribed stock at public or private sale at $20

——Common

Co.-

Dealers Credit

£0

see

Debentures

April 30, 1946
Consol.

For details

Carpet

New Haven Clock & Watch Co

Common

Utah Power & Lt. Co.

filed

share.

Preferred

Utility Appliance Corp

25,000 shares of capital stock (par $10).
rtderwriters—None named.
Offering—Company has
ranted holders of capital stock rights to subscribe at

V-

Common

Super-Cold Corp

Iowa

Dallas Title & Guaranty Co., Dallas, Texas
21

Fitth

—;—-Preferred

Incl

Preferred and Common

Norwalk Tire & Rubber Co

12.25 per share.

eft

Preferred;

Publishing Co

Holly Stores Inc.——
Jessop Steel Co.

46,050 shares common stock ($2 par)r
ares are being sold by certain stockholders.
Underriters—Cruttenden & Co.
Offering—Price to public

Preferred

DuMont (Allen B.) Laboratories Inc

filed

Class A Stock

Crowell-Collier

issue of April 4.

see

Bowser,

.Preferred

Corp
Commercial Capital Corp

ares are

mendment.

—_

Aro Equipment

tarch 29 filed
*

Air Products Inc.—

For details see issue of April 4.
N. Y.

May" 3,1946

April 20, 1946

mrchase of the bonds will be received by company up

Crowell-Collier Publishing Co,r

Preferred

Public Service Co. of Ind, (11 a.m. CST>———Pfd.
R0d Top Brewing. C6U*—_
ClaSs A' Common'
Selected Industries Co
Debentures

kobable

^noon (EST) April 30.

May 2, 1946

Joy Manufacturing Co.—_i——-Comnion

Panhandle Eastern Pipe Line Co.—Debentures

amendment,

filed, by

American* Acoustics, Inc.—Preferred and Common
Gerity-Michigan Die Casting Co.—
--Common*

arch 29'filed $44,660,000' series R first
enf,

Common

April 26, 1946

Light & Power Co.

of Baltimore

age bonds due April 1, 1981*.

April 25, 1946

Offering—Price by amendment.

Consolidated

nf i

New Issue Calendar

preferred stock (par $25) and 197,000 shares
(par 10c).
The 19,419 shares of preferred
162,000 shares of common are being purchased by

common

2263

*£rch 18 filed 19,419 shares of 6% cumulative
'ertible
f

-ftv'vt' at: •* 5v- ✓A**

THE COMMERCIAL & FINANCIAL CHRONICLE

pfume 163' Num^ef
t

Kan.

1946

City Fire & Marine Ins. Co

Common

(4/30)

pril 18

(letter of notification) 250,000 shares of comand $225,000 5% promissory notes, due in
years.
Offering includes 71,425 shares common and
38,225 notes originally issued in violation of SEC regutions.
Price of common, 100 per share; notes, par.roceeds—Carry on company's business in financing
urchase of personal property.
stock

Federal Mfg. & Eng. Corp., Brooklyn

Firth

Diamond T Motor Car Co., Chicago, III. (5/1)

arch 29 filed 60,000 shares of common stock

(par $2).
being sold by certain stockholders. Underwritrs—Hallgarten & Co.
Offering—Price to public by
Mendment. For details see issue of April 4.
hares are

DuMont
N. i.

(Allen B.)
(4/29)

Laboratories, Inc., Passaic,

ar; 10 cents), of which 525,000 shares are being offered
>r sale by underwriters.
Underwriters—Van Alstyne,
oel & Co. and

Kobbe, Gearhart & Co., Inc. Offering—
riCeto public by amendment.
Proceeds-^To expand
revision broadcasting and manufacturing facilities and
erations in the low-frequency fields.
For details see
sue of April 4.

Corp., Detroit (5/6)

17,000 shares common stock (par $5).
being sold by officers and employees or their
latives. 1 Offering—Shares may be sold from time to

pril

(5/3)

see

•

17 filed

(M. H.)

For details

Co., Inc. 5c to $1 Stores, N. Y.

April 15 (letter of notification) 2,500 shares of common
stock (par $1).
Not underwritten.
Stock is to be sold,
on the New York Curb Exchange at approximate
price
of $31 per share.
Shares being sold by Meyer H. Fish-

Fleming-Hall Tobacco Co., New York

April 17

(letter of notification)

Common

stock

per

converting.

Gerity-Michigan Die Casting Co., Detroit (4/26)]
shares of common stock (par $1),
of which 300,000 shares are being sold by company and
150,000 shares by certain stockholders.
Underwriters—
Buckley Brothers, Mercier, McDowell & Dolphyn, Ames,
Emerich & Co., Inc., and Dempsey & Co.
.Offering—
Price to public by amendment.
Proceeds—To pay note.
to Associates Discount Corp.; to retire 1,967 shares of
cumulative 6% preferred stock ($100 par), balance tor
finance increased inventories and payrolls.
For details4
see issue of April 4.
•
i

Giant Yellowknife Gold Mines, Ltd.,

Toronto, Ont« '
shares ($1 par, Cana- ;
dian).
Shares are being offered to residents of United1
States and Canada by Toronto Mines Finance, Ltd. These*
on

Feb. 21 filed 81,249 common

are part of a recent offering of an aggregate of t
525,000 shares offered by the company in Canada to its
own shareholders at $5
(Canadian) per share. Under¬
writers—Toronto Mines Finance, Ltd., 25 King Streets

man.

ares

jae upon: the New York Stock Exchange or the Detroit
ock Exchange by the owners of such shares. For deiis see issue of April 18.

receivable, general working capital.
issue of April 4.

Fishman

Underwriter—Kobbe,
Co., Inc. Offering—Tb be offered at $5.10
per unit of one share of preferred and one share oF
common.
Purpose—Working capital.^ Business—Textile:
19,252 common shares (par $10).

Gearhart &

March 27 filed 450,000

by Harold E. Wadely, President, and 30,414 by Graham
Hunter, Vice-President, Treasurer and Secretary.
Un¬
derwriters—Reynolds & Co. Offering—Price to public
by amendment.
Proceeds—To finance inventories, ac¬

•

Eureka Williams

Carpet Co., N. Y.

March 29 filed 125,000 shares common stock (no par),
of which 33,436 shares are being sold by company, 61,150

counts

!arch 29 filed 650,000 shares of class A common stock

(5/6)

16 filed 116,000 shares common stock (par $1).
Shares are being sold by four stockholders.
Under¬
writers—Sills, Minton & Co., Inc.
Offering—Price to
public by amendment.

April

for

benefit

2,700 shares
S.

Korn.

(par $1).
Price $5

West Toronto, is named underwriter.
It is wholly owned
controlled by its parent company, Ventures, Ltd.

and

share.

$5.10 (Canadian) per share, or the
equivalent.
For details see issue of

Offering—Price is
•

Fuller

April

(D. B.)

(letter

cumulative

& Co., Inc., New York

notification) 19,252
preferred stock

convertible

shares of 6%
(par $5) and

United

States

Feb. 28.

„

,y-

(Continued

on page

2264)
fi'.

■M

^UNDERWRITERS—DISTRIBUTORS—DEALERS
I'.O/t'

.v?

' '

•

The Marine Midland Trust

-v

..i;.

Industrial, Public Utility, Railroad

Company

Lee Hicginson Corporation

OF NEW YORK

and

Municipal Securities

Transfer
ONE

/§

Hemphill, Noyes <3& Co.
'
-

^EW YO*K
PHILADELPHIA

Members New York Stock

ALBANY
PITTSBURGH

Exchange'

CHICAGO
TRENTON

INVESTMENT SECURITIES
Agent

HUNDRED

♦

Registrar

TWENTY

♦

Trustee

BROADWAY

Underwriters,. Distributors

N£# YbRKf l5, N. Y.

and Dealers

INDIANAPOLIS
WASHINGTON

RECTOR 2.220$

new york:

BOSTON

CHICAGO

2264

Thursday, April 25, 1946

THE COMMERCIAL & FINANCIAL CHRONICLE

Now

Securities

INDICATES ADDITIONS SINCE PREVIOUS ISSUE

•

(Continued from page 2263)
:r

;:~K

Gold City Porcupine Mines, Ltd.,

Jefferson-Travis Corp.,.

' '#•'

■■

Toronto, Oni

Jan. 4 filed 600,000 shares of common stock (par $1)
Canadian
currency.
Underwriters—No underwriters

named.

Offering—Company is offering common stock
public at 50 cents U, S. currency per share. If com¬
pany accepts Offers from dealers to purchase the stock,
company will sell to such dealers, if any, at 32.5 cents
II. S. currency per share for resale at 50 cents U. S.
currency per share.
to

Gold Hill Mines Co., Aspen,

Col.

•

with

the Bank

1,300

about

The

April

execution and delivery of

bank

as agent for Sanis authorized to sell

and

deed of

1,300

pet share" market

March 28 filed

Greer

equipment.

Price

(about) 22% per share.

Hydraulic, Inc., Brooklyn, N. Y.

(4/30)

(letter of notification) 88,000 shares of com¬
stock (par 500) and warrants to purchase 50,000

Graff

stock.

common

Co.

Underwriters—Townsend,
to public, $3.37 */2 per

Proceeds—Working capital.

17 filed 270,000

shares of

Underwriters—Allen & Co.

common

have

stock (par $1).

withdrawn

under¬

writers.

Offering—Price to the public by amendment.
is being offered initially to present shareholders
price to be filed by amendment.
Holders of ap¬
proximately 200,000 shares have agreed to waive their
preemptive rights.
Postponed indefinitely.
For details
Stock

Proceeds—$825,000 to
regulation; V-Loan; balance for additions.
For
details see issue of April 4.

issue of Jan. 24.--

stock

($2 par).
being sold by certain stockholders.
Under¬
Bissell &. Meeds have withdrawn as
underwriters. -Offering—Price to public by amendment.
Shares

common

are

engineering service, exploration, etc.

(par $1).

51,400 shares common stock

and

#
i
(par $1) with common stock purchase warrants attached',
and 150,000 shares of common (10c par).
Dividend ratP7
on preferred by amendment.
The statement covers 200,4
Morris Plan Corp. of

Corp. (15,800).
Underwriters—
Hallgarten & Co. and R. W. PresSprich & Co.
Offering
—Price to public by amendment.
For details see issue
of April 4.
Kansas City

Jan. 29 filed 100,000

(Mo.) Fire & Mar. Ins. Co. (5/24)

held.

common

share of

one

stock for each share of

of Feb. 7.
•

Price by

Fibre Co.,

Keyes

Portland,

Me.

see

issue of March 7.

(5/1)

Hendry (C. J.) Co., San Francisco, Calif.

(5/11)

Underwriters—Otis & Co. Offering—Price

public $6.50 per share.
Proceeds—Purchase of new
machinery and equipment; new plant, etc.
For details
see issue of April 18.

Hoffman Radio Corp., Los

Angeles, Calif. (5/10)

March 30 filed 120,000 shares common stock (par $1).
Underwriters—Cohu- & Torrey. Offering—Price to pub¬
lic $6 per share;
Proceeds—$97,125 to redeem/preferred
stock

and

bank
details

approximately $400,000 to retire short-term
borrowings; balance for working capital. For
see issue of April 4.

Holly Stores, Inc., New York (4/29)
April 10, 32,000 shares 5% cumulative convertible pre¬
ferred (par $25), and 100,000 shares of common (par $1).
Underwriter—Carl M. Loeb, Rhoades & Co. OfferingPrice
to
public by amendment.
Proceeds—Will be
added

working

capital.

April 8.

For

details

see

issue

McGraw

(F.

(par $1).
develop¬

& Co.,

For details

ment.

see

■

125,000 shares common stock (par $1).
Underwriters—Herrick, Waddell & Co., Inc., Offering—
Price to public by amendment.
Proceeds—Working
capital for expanding operations and to retire present
bank borrowing.
Company intends to advance to Air
King Products Co., Inc., a subsidiary recently acquired,
$500,000 to equip new plants and for working capital;
For details see issue of April 4.

see

Distilling

Terre

Haute,

Norwalk

Ind.

March

136,254 shares common stock

for

each

five

are

held.

common

for every 70

Proceeds—

Midwest Rubber

,111.

(5/7)

Ohio
March

Reclaiming Co., East St. Louis,

18 filed 40,000 shares of cumulative preferred
31,110 shares of common stock.
Underwriters—
Shields & Co. and Newhard, Cook & Co,
Offering—
Company is offering to holders of common stock of
Mid-West Rubber Reclaiming Co., a predecessor cor¬

April

Illinois Power Co**, Decatur, III.
Feb. 27 filed $45,000,000 first mortgage bonds due 1976
and

$9,000,000 sinking fund debentures due

curities will be offered

with price and
cessful bidder.

1966.
Se¬
^fpjr sale at competitive bidding

intercalates to be named by the

suc¬

Underwriter?—Names by amendment.
inclpd^Halsey, Stuart & Co., Inc.,
The First Boston Corp/
For details see issue of

Probable

and

bidders

March 7.

Indianapolis

(Ind.) Power & Light Co.
142,967 shares of common stock (no par).
sold through competitive bidding
in accordance with ruling of State Commission. Original¬
ly underwritten by Lehman Brothers, Goldman, Sachs &
Co. and The First Boston. Corp., but Otis & Co. expected
March 8 filed

Underwriters—To be

to bid.
ers.

at rate of ore fhare

held.

and

the right to subscribe to the • new -common
each
four shares of the predecessor corporation's common
stock.
Price by amendment*
Unsubscribed common
stock and preferred sto^k will be offered to public.
Price by amendment.
Proceeds—Enlargement and re¬
habilitation of company's - manufacturing facilities, in¬
cluding purchase of additional tools, machinery and
equipment. Business—Manufacture and isale of reclaimed
poration,

For details

see

new common

for each five shares
•«-?

issue of March 14.

(4/29)

convertible debentures

due

Under¬

Interest rate by amendment.

shares of common stock held at 101.

Public
filed

Right'-

For details see issue of March 28.
Service Co.,

Cleveland, O.

first mortgage bonds, due
1976; $5,500,000 serial notes and 156,300 shares of cumJ
ulative preferred stock (par $100).
Interest rate on th?
bonds and notes and dividend rate on the preferrec
Stock by amendment.
Underwriters—To be filed hi
amendment.
Probable bidders include Mellon Securitiet
30

$32,000,000

Corp.; Halsey, Stuart &'Co., Inc. (bonds only); the First
Corp. Offering—Prices' to public by amendment;
Proceedsrr-Redemptioni&nd payment* of bonds, notes anc

Boston

preferred stocks For details .see? issue of April 4.

stock in the ratio of one share of new common for

rubber.
.

•

Minneapolis-Honeywell

Offering—Company is offering tthe stock to hold¬

pf common stock at a price to be filed by amendment

$1,444,500

expire April 27.

$1,500,000 of proceeds to reduce loans payable to banks,
balance to working, capital, to finance work in progress.
Business—Distilled spirits.

•\

(Conn.) Tire & Rubber Co.

filed

scribe for new debentures at rate of one $500 debenture

share, pro rata, at the rate of one share
shares

(5/3);

Clock & Watch Co.

writers—Carl M. Loeb, Rhoades & Co.
Offering—Com-!
mon stockholders of record April 11 given right to sub*1

being offered by the corporation to the holders of its
common stock for subscription prior to 3 p.m. June 4,
per

April 15, 1956.

(par $1).

Offering—Shares

(Conn.)

of 4V2% cumulative con¬
vertible preferred stock (par $20). Underwriters—Rey$
nolds & Co.
Offering—Price to public by amendment!
Proceeds—To repay at $481,360 bank loan; to redeerr/
4,376 shares of 6J/2% cumulative preferred stock; balance
for purchase of new machinery.
For details see issu*
of April 4.

(5/12)

1946, at $16

issue of April 4.
New Haven

Inc., New York (5/6)

Corp.,

•

March 29 filed 62,500 shares

Offering—Price to public will be filed by amendment.
Merchants

Los Angelesr

share (par $1).—Under*!
writers—Bond & Goodwin, Inc. Offering—Price to public!
$5 per share. Proceeds—Working capital. For detail?

April 17 filed 279,250 shares common stock (no par).
The shares are outstanding and are being sold by 21
stockholders.
Underwriters — Clark,
Dodge and Co.

•

Freight Corp.,

March 30 filed 500,000 common

issue of March 28.

Mercantile Stores Co.,

Skyway
(5/8)

Calif.

Hartford, Conn.

Underwriters—Not underwritten.

Hytron Radio & Electronics Corp., Salem, Mass.

National

public by amend¬
issue of April 4.

$1.50 preferred stock (no
par) and 100,000 shares of common (par 10 cents). Un¬
derwriters—Granbery, Marache & Lord and Bear,
Stearns & Co. " Offering—Prices to public by amend¬

April 23 filed

(5/1)
March 29 filed

For details see issue of March 28.

March 25 filed 36,000 shares of

H.)

(4/30)

shares of common stock (par $l)i
of which company is selling 50,000 shares and certain
stockholders
150,000 shares.
Underwriters—Bond &
Goodwin, Inc.
Offering—Price to public $6 per share,

March 20 filed 200,000

Longines-Wittnauer Watch Co., Inc., N. Y. (5/6)

see

Inc., Maiden, Mass.

National Co.,

For details

capital^

will be added to working

devoted, as conditions require and permit, to open,
or acquire additional retail stores and to
expand ant*
improve existing shops, etc. - Business—Retail mail order
house specializing in style merchandise.
to be

ment.

Hess, Inc., N. Kansas City, Mo£

■

ceeds—Net proceeds

shares of common stock, par $1. Of
the total 80,000 shares are being purchased by the under¬
writer from the company and 50,000 shares from two

and Emanuel & Co. Offering—Price to

Company is offering to holders of common stock the ne^
stock for subscription at rate of one share for each five
shares of common held.
Price by amendment.
Pro-*

ment and

(par $25).
Underwriters—First California
Co. Offering—Price to public $25 per share.
For details
see issue qf March 28. V

Business—Sale and servicing

April 22 filed 397,644 shares common stock ($1 par)^
Underwriters—Emanuel, Deetjen & Co.
Offering-

L'Aiglon Apparel, Inc., Philadelphia (4/30)

cumulative

(letter

National Bellas

•

March 11, 130,000

manufacturing consultant of company. Under¬
writers—Paul H. Davis & Co., A. C. Allyn & Co., Inc.,

ceeds—Working capital.
of mortgages.

first mortgage bonds due April
1, 1966. /Interest rate by amendment.
Underwriters—
Coffin & Burr, Inc.; Paine, Webber, Jackson & Curtis,
Estabrook & Co., E; H. Rollins & Sons, Inc., and H. M.
Payson & Co. Offering—Price to public by amendment.
Proceeds—To redeem $1,800,000 4%% first mortgage
sinking fund; cost of construction and equipment of the
Hammond plant.
For details see issue of April 4.

March 20 filed 24,000 shares of preferred stock, 5Vz%

■

(5/lJy

Philadelphia

of notification) 5,000 shares of 5%|,
cumulative preferred stock (par $20) and 3,500 commott
shares (par $10).
Underwriters—Butcher & Sherrerd
Offering—To be offered in units of 10 shares of pre^:
ferred and 7 shares of common at $207 per unit.

March 28 filed $2,800,000

March 29 filed 125,000 shares of common stock
Shares are being sold by Ira Guilden, research,

•

Mortgage Associates, Inc.,

April

May 24.

expire

Offering
issue,

public by amendment. For details see

com¬

amendment.
Subscription rights
Unsubscribed shares will be sold to
underwriters.
Proceeds—To increase capital and sur¬
plus. For details see issue of April 4.

mon

reserved against war**?

Underwriters—Eastman, Dillon & Co.

—Price

stockholders of record May 11

new

America, N. Y. (4/30)

shares of preference stock, series

000 additional shares of common

rants.

March 28 filed 50,000 shares of common stock (par $10).
Underwriters—First Boston Corp.
Offering—Shares are

writers—Laird,

For details

of class A common and 20 shares Qi]
$101.20 per unit. Business—Technical

one share
class B common at

ferred,
filed

stockholders.

Hayes Manufacturing Corp., Gr. Rapids, Mich.
F,eb. 27 filed 215,000 shares of

April 15 (letter of notification) 2,500 ^hares (par $100) t
cumulative, non-voting,
convertible preferred stocky
900,000 shares class A non-voting (par 10) common stock\
and 100,000 shares of class B (par 10). voting comrap#;
stock.
Underwriters are Robert H. Malcolm, Earl MJ»-:
Turner, Byron A. Johnston and • Frederick M, Harris
Offering—To be offered in units of one share of pre-j

Joy Manufacturing Co., Pittsburgh (5/2)
March 27

see

Offering—

retire

Business—Design,

Gulf AtlanticTransport'!! Co., Jacksonville, Fla.

Dividend rate by amend¬

$25).

Offering—Price

engineering, development and manufacture of aircraft
testing, service, repair and overhaul equipment of air¬
craft of all types.

Jan.

(par

April 18.

Corp., Dover, Del.

Modern Development

•

Underwriters—Paul H. Davis & Co.

being offered to

April 23
mon

refinance preferred l

Purpose—To

share.

per

For details see issue of

stock.

(4/29)
60,000 shares of cumulative convertible

preferred stock

at rate of

$108

Jessop Steel Co., Washington, Pa.

upon

conveyance and sale

and delivery of certain machinery and

preference stock is being offered to the holders of out-»i
standing preferred stock.
Unsubscribed shares will bp,?
sold to underwriters who will offer them to the public I

American International

of New York

Corp.

issue of March 7.

Shares being sold by Adams Express Co, (35,600)

April 17 (letter of notification) 2,600 shares of capital
stock (par $5).
The 2,600 shares are to be deposited in
escrow

see

Offering-—-New',

Securities Corp.

Underwriters—Union

(5/1)

Price to public by amendment.

Gray Manufacturing Co., New York

born-Raymond

New York, N. Y.

Feb, 27 filed 30,000 shares of $1.25 cumulative convert¬
ible, preferred (no par) and 130,000 shares of common
(par 25c). Common shares are reserved for conversion
of preferred.
Underwriters—Richard J. Buck & Co.'
Offering—Price; to public $25 per share.
For details

ment.

April 17 (letter of notification) 500,000 shares common
(par 100).
Price to public 100 per share.
Securities
will be offered by following officers of the company:
William Walton Moore, Robert M. Lawrence and Betty
Ann Moore.

a%i

Registration

apolis

■&.

1
Regulator

Co.,

Minne-

(5/6)

April 17 filed 85,700 shares of convertible preference *
stock

issue

(par $100) and common stock to be reserved for i
conversion of the series A preference stock.- •

Palmetex Corp., Pinellas Park,
MStch 22Z#iiefr

scares

Fla.

(5/7)

stock

(par $1)

Underwriter—Floyd D. Cerf Co., Inc., Chicago. Offerinj
-?-Price to public-is $3.25 per share. Proceeds—Purchase
of plant

occupied under lease, new dryer, working capi

tal, etc.
ij

Panliandle Eastern Pipe Line Co., Chic.

(4/26)

April 4 filed $50,000,000 serial debentures, dated Ma:
1, 1946.
Interest rate by amendment.
Underwriters^,
First $20,000,000 maturities to be sold privately; balance
underwritten by Kidder, Peabody & Co., Merrill Lynch
Pierce, Fenner & Beane, and

Halsey, Stuart & Co., Inc

^SdmOM^
•''

•

•ito

Offering—Price to public by ameridment. Proceeds^To/
redeem

outstanding $30,250,000 bonds,

promissory

prepay

notes and pay cost of construction work
tfor details see issue of.April 11.

now

authorized.^

Offering—1,886 shares of 6% cumulative

are

pre-

offered in exchange

(one new share for 10
old shares) for shares of 4%
preference stock ($10 par),
together with all dividends accrued thereon. Exchange

'Offer

V""*'ii'j ■ ii.{■ ri* /••'«yMnr»«

f il'

'»- i>

V;ii''VVi

«**,frfr-it**# -r
riifr'"ffirr'ftii-i"rfi" r'-^-^^rrnm'-H^ir-rititt'^-^

conditioned

purchase

of remaining

8,000

shares of 6%

cumulative preferred and of the 31,000
bommon stock purchase warrants by underwriter. Pro¬
ceeds—Purchase or construction of a plant and nec¬
essary machinery and, equipment.
For details see issue
of April 4. ;
*
■
.

Roberts & Marnier Corp.,
Hatboro, Pa. / (5/1)
April 2 filed 283,790 shares of common stock (par $1).
Company is offering 175,000 shares and Stroud & Co.
Inc. is offering 108,790 shares which it owns.
Under-

loans, balance for working funds.
of April 4.
;

31,000 shares of common, issuable upon the exercise of
the warrants. IThderwriters^—Butcher &
Sherrerd, Phil¬
/"erred

~ 'i||

writers—Stroud & Co. Inc.
Offering—Price to public
by amendment.
Proceeds—Company plans % to use Its
share of the proceeds for the payment of
$600,000 bank

Paulsboro (N. J.) Manufacturing Co.
^arch 29 filed 9,886 shares 6% cumulative preferred
^par $100); 31,000 common stock purchase warrants and

adelphia.

?":■''''Lip ,u:i, '//UJUuv '-U"/'. '•'- '-'—-.-v-*-:jv. W>

For details

see

issue

Peerless Casualty Co., Keene, N. H. (5/1)
March 8 filed 50,000 shares of common stock (par $5).
Underwriters—Herrick, Waddell & Co., Inc., New York.
Offering—Common stockholders given right to subscribe
new

shares in ratio of 5 additional shares for each

11 shares

held, at $14

For details

see

per

share.

^Prices to public by amendment.

For details

see

issue

f March 28.

Feb. 18 filed 150,000 shares of

stock (par $1).
Offering—Price to
For details see issue

per

treasury shares at 40 cents
share, payable in Canadian exchange. Mr. Kemerer

has assigned to Mark Daniels, 371
Bay
in consideration of $1, the former's

Street, Toronto,

right and option to
purchase 300,000 of the 500,000 shares optioned to Mr.
at 30 cents per share.
Mr. Daniels plans to
market the shares optioned to him
through the medium
of a registered broker or brokers in the
United States.
Offering—Price to public is 40 cents per share, U. S.
funds.
Proceeds—Proceeds will be applied to
ment work, etc.
Salt

develop¬

For details

Dome Oil

issue of April 4.

see

Corp., Houston, Texas

March 28 filed certificates of interest for
800,000 certifi¬
cates in overriding royalty in
oil, gas and surplus. Under¬
writers—Cohu & Torrey, New York, and Yarnall &

Co.,

Philadelphia.

Offering—Company is offering the

cer¬

tificates of interest to stockholders on basis of one
share
interest represented thereby for each share of
common
stock held at 58 cents per share.
and

Proceeds—Exploring

developing.

For details

issue of April 4.

see

Samson United Corp., Rochester, N. Y. (4/30)

March 15 filed 125,000 shares of cumulative
convertible
preferred stock (par $8). Dividend rate by amendment.
Underwriters—Burr & Co., Inc.
Offering—Price
For details

Scranton

see

issue of March 21.

Electric Co.,

be used to redeem 53,248 shares of

tock

March 29

per

Public

pril 4 filed 200,000 shares of

common stock (par $1).
Goodwin, Inc.
Offering—Price
o public $3 j3er share.
Proceeds—Payment of notes,
urchase of flight equipment, additional
hangar faciliies, improvement of airport property and other related
s. For details see issue of
April 11.

nderwriters—Bond &

y/ Public Service Co. of Ind.,
March

Inc.

filed

150,000 shares of cumulative preferred
Dividend rate by amendment. UnderIters—Names by amendment.
Probable bidders?:inJude Kuhn, Loeb & Co. and Harriman Ripley & Co.
-Jointly); Glore, Forgan & Co.; the First Boston Corp.
ffering—Company proposes to issue the 150,000 shares
f hew preferred for purpose of
refinancing at a lower
vidend rate the 148,186 outstanding shares of old
pre¬
tock

(par $100).

wired 5% cumulative series A.
hare
he

for

basis

with

cash

Exchange will be on a
adjustment. Bids for

purchase of the shares will be received by the comto 11 a.m. CST April 26. For details see issue of

any up

rch 28;

share.

Common shares

are

$6 preferred at $110
being sold by American

Bids Invited—Bids for the purchase
of the bonds will be received at office of American Gas
& Electric Service Corp., 30 Church
St., New York, up to
12 Noon (EDST) on April 30, for the
purchase of the
preferred stock. Dividend rate is to be specified in the
bid. For details see issue of April 4V ; *

Scranton-Spring
Barre, Pa.

Brook

Water

Wilkes-

Co.,

Feb. 8 filed $23,500,000 first mortgage
bonds, due March

15,

1976,

and

100,000

cumulative

preferred

stock (par $100).
Interest and dividend rates by amend¬
ment. Underwriters—By amendment.
Probable bidders

general /funds and will be available for general/
corporate purposes. For details see issue of April 4.
r'

*•,<

arch 29 filed 500,000 shares of common stock
(par $10).
"nderwriters—Names by amendment/Probable bidders
uclude Kuhn, Loeb & Co.: Harriman, Ripley & Co., and

mith, Barney & Co. (jointly); Kidder, Peabody & Co.
nd
Blyth
&
Co.,
(jointly);
The
First
Boston
rp. and Coffin & Burr (jointly).
Offering —Com-

will sell at compettiive bidding, for an aggregate
$5,000,000, not exceeding 500,000 shares of comstock, the number of shares to be determined by

ach bidder.

Proceeds—New

eing issued to retire
nd serial

117,404
provide funds for construction
For details see issue of April 4,

notes and to

nd extension.

Puerto Rican
(5/1)

and preferred are
shares of old preferred

common

Overseas

Airways Corp., N.

pril 23 (letter of- notification) ^14.950 shares" of 6%
mulative preferredcgtock

(par $20);>- Offering—Price

20 per share.
ProcCeds^Finance; airline and its equipent from New Yorki-New ;Jersey xtoi Island of Puerto

ico, working capital.

Red Top

Not underwritten.

ela^A^mriioiy

$1). Shares are being sold by;certaih. stockholders.
nderwriters-^Westheimer / & / Cp./ Gr&ttendenr &

four

Edwards

Sons, Loewi & Co., Stein Bros. &
Ohio Company, and Piper, Jaffray & HopOffering—Pjrice to public $10.50 > per share. For

oyce, the

mod.

tails

see

issue of March 28.

pril 15 (letter of notification) 50,000 shares of common
ock (par /
pndeiwriter—Federal /Corp;; N. Y;
ffering—Price to public 900 per share.
Proceeds—
orking capital.
-

;

' <■'

f<-

p.m.

Super-Cold Corp., Los Angeles, Calif. (4/29) J.
March 29 filed 200,000 shares common stock
(par $1).
Underwriters—Sutro & Co. and Van Alstyne, Noel & Co.

Offering—Price

public

per share.
Proceeds-^
be applied in payment of
existing current liabilities, including bank loans; $200,000
for purchase of
machinery and equipment, and remain¬
der for working capital. For details see issue
of April'4.

Approximately $575,000 will

Taca Airways, S. A., N. Y. (4/30)
March 30 filed 500,000 shares Common
(par $5). Under¬
writers—Hallgarten & Co. and G. H. Walker & Co.
Offering—Price to public by amendment.
Proceeds—
No

specification of the net proceeds has
see issue Of April 4.
\

For details

made.

been

0- A-.-\v-s-r-.;.

•

Ten-Pin Lanes Inc., Cuyahoga Falls, Ohio
April 18 (letter of notification) 400 shares common (par
$100). Price to public $100 per share. There will be no
underwriters.
Proceeds will
lease of bowling alleys, etc.
"

used

acquisition of

/.j

Pj A "

•

Tucson (Ariz.) Gas, Electric Light & Power Co*
March 29 filed 147,000 shares common stock

"(no par).

Stock constitutes all of the
outstanding common stock of
Tucson and is owned by Federal Light and Traction Co.
Underwriters—By amendment.
Probable bidders in¬
clude Harriman Ripley & Co.; The First Boston

Corp.,

and

Blyth & Co., Inc. Offering—Federal will offer the
stock for sale at competitive
bidding and price to public
will be filed by amendment.
| r ( \/
>1
•

Tyler (C. A.) & Co., Inc., Boston, Mass.,/
April 22 (letter of notification) 490 shares no par com¬
mon
stock. v Price to public $125 per share.
Under¬
writers—G.

capital.

///;'/

Rose

Co.

Proceeds—For

working

Union Electric Co. of Missouri
March

29 filed 130,000 shares of
preferred stock (no
par).
Dividend rate by amendment.
Underwriters—
By amendment. Probable bidders include White, Weld
& Co., and Shields & Co,
(jointly); Dillon, Read & Co.
Inc.; Lehman Brothers, and Blyth & Co., Inc. OfferingNew preferred will be issued in connection
with an ex¬
change offer and company will ask for competitive bids
with respect to exchange plan and
purchase of the new

Kansas City, Mo.
42,000 shares capital stock (no par). Under¬
writers—P. W. Brooks & Co.,
Inc., New York. Offering
—Company will offer the 42,000 shares for a period of

St., New York,
(EDST) on May 1 for purchase of the
securities, the bidders to specify the interest and divi¬
up

to 12 Noon

dend rates.

For details

see

issue of Feb. 14.

derwriters—Floyd D. Cerf & Co.

Un¬
Offering—Holders of

stock, 7% preferred stock and $2.50 cumulative
preferred stock are given right to subscribe to new
shares at rate of one share of common for
each two shares of any such stock held. Price by amend¬
ment.
Proceeds—Purchase of additional
common

machinery and
equipment for modernization of present facilities, etc,
For details see issue of April 4.
Selected Industries, Inc., N. Y. (4/26)
March 30 filed $6,900,000 debentures due April
1, 1961.
Interest rate by amendment. Underwriters—Union Se¬
curities Corp. Offering—Price to public by amendment.

•

Sillers

bank loans.
.

For details
;

Paint & Varnish

Co., Los Angeles
April 18 (letter of notification) 300,000 shares capital
stock (par $1). Price to public $1 per share.
No under¬
writing.

Sinclair Oil Corp.,

N. Y. (4/25)

150,000 shares of

common

two

sale

common

Proceeds—To pay $6,900,000
see issue of
April 4.

Union Wire Rope Corp.,

Feb. 4 filed

stock (no par).

Shares are being sold by H. F. Sinclair, Underwriters—
Kuhn, Loeb & Co. Offering—Price to the public based
on market.
For details see issue of April 4.

weeks
to

Sonotone Corp., Elmsford, N-' Y. (4/26) '
March 25 filed 60,000 shares $1.25 cumulative convertible

after

the

stockholders

see

issue of Feb. 7.

•

U. S.

effective
at

$15.50

date
per

of registration for
share., For details

Airlines, Inc., St. Petersburg, Fla. (5/1L)
April 22 filed 900,000 shares common stock (par $1)
and 300,000 stock purchase
warrants, of which 150,000
have been issued to Harry R.
Playford, President, and
150,000 will be issued to underwriters.
Underwriters—
R.

Johnson & Co.
Offering—Price to public $3.25
share.
Proceeds—To pay principal and interest on
bank loan, to finance purchase of additional
aircraft,
equipment, etc., and for working capital.
BusinessTransporting cargo by air under contracts with shippers.
per

United States Rubber C<k, N. Y. (4/30)
April 11, $40,000,000 2%% debentures/due May 1, 1976.
Underwriters—Kuhn, Loeb & Co. Offering—Price to
public by amendment. Proceeds—To provide additional
working capital. For details see issue of/ April 18.
'

r-X "••£'.* 'ii;''-

•

United Transit Co., Richmdnd, Va.
March 29, 200,000 common shares (par

$1).
Stock is
outstanding and owned by Equitable Securities Corp.,
C. Allyn & Co., Inc.,
96,779 shares each, and Paul
M. Davis of
Nashville, Tenri;,5^443'shares. Underwriters
—Harriman Ripley &
Co.,; Inc'.irOffering—Price to public
by amendment. For details "see'issue of April 4.
A.

Feb.

Universal-Cyclops Steel Corp.^ Bridgeville, Pa.
13

filed

3,500 shares

notification).
holders.

are

of
for

common

account

stock

(letter

certain

stock¬

Underwriter—A. G. Becker & Co.

preferred stock/ series A (par $20). Underwriters-rVan
Alstyne, Noel & Co.
Offering—Price to public is $25

United Wallpaper^ Inc., Chicago *
5/4)
April 15 filed 40,000 shares cumulative convertible pre*ferred stock (par $50). Dividend rate
by amendment
Standard Steel Spring Co., Corapoiis, Pa.
Underwriters
Hemphill, Noyes & Co.
Offering —
Price to public by amendment.
Proceeds—Corporate
April 10 filed 100,000 shares of convertible preferred stock
purposesr including enlargement and equipping of a
(par $50). Dividend rate by amendment. Underwriters / factory building at Montgomery, 111;
For details see
issue of April 18.
—Goldman, Sachs and Co. Offering—The price to pub¬
lic by amendment.
Proceeds—Principally for expanding
(Continued on page 2266)

pet share. For details see issue of March 28.

—

Relter-Foster Oil Corp., New York

' <

held at $50 per share.
Rights
For details see issue of Mar. 21.

common

expire April 24 at 3

Cd$

of Federal Water & Gas Corp., 90 Broad

Dec. 26 filed

Brevflpg)(pp.,} Cincinnati, sObiosi4/26&

rch 26 filed 150,000'. shares' of

stock. Purpose—To refinance old
preferred stock at a
lower dividend rate. * For details see issue of
April 4.

Halsey, Stuart & Co., Inc. (bonds only); Mor¬
gan Stanley & Co.; Kuhn, Loeb & Co.V Lee Higginson
Corp. and Smith, Barney & Co. (jointly); Mellon Securi¬
ties Corp. Bids Invited—Bids will be received at office

rice of
on

)Vl

include

Segal Lock & Hardware Co., Inc., N. Y.
March 30 filed 738,950 shares of common (par $1).

Public Service Co. of New Hampshire

}ny

filed

Gas & Electric Co.

Flyers, Inc., N. Y. (5/8)

Offering—Price to public by
Proceeds—Net proceeds will be added to

the

ing—Company is offering to holders of common stock
of record April 8 pro rata rights to subscribe to new
preferred on basis of one share of preferred for each

dded to cash assets.

Phillips-Jones Corp., New York

'!i>

exclusive option dated Feb.
20, 1946, to Morgan U.
Kemerer of Toronto to purchase
500,000 treasury shares

at 30 cents per share and 500,000

pril 15 (letter of notification) 8,815 shares of common
(no par).
Shares will be sold to 36 executives
f the company at
$27.50 per share.
Proceeds will be

ublic will be filed by amendment.

'' •"

March 19 filed 67,731. shares of 4% convertible
preferred
stock (par $50). Underwriter—First Boston
Corp. Offer¬

Scranton, Pa.
53,248 shares of cumulative preferred
stock and 1,214,000 shares common stock (par
$5). Com¬
mon stock is being sold
by American Gas & Electric Co.
(parent) i Underwriters—By amendment. Probable bid¬
ders include Smith, Barney &
Co.; Mellon Securities
Corp.; Merrill, Lynch, Pierce, Fenner & Beane, and Kid¬
der, Peabody & Co., "(jointly). Proceeds—Net proceeds
from sale of preferred, together with
treasury funds, will

f Feb. 20.

Stromberg-Carlson Co., Rochester, N. Y. (4/25)

amendment.

common

Underwriters—Hayden, Stone & Co.

■*'

Underwriters—Otis & Co.
amendment.

Piper Aircraft Corp., Lock Haven, Pa.

Steep Rock Iron Mines Ltd., Ont., Can.
March 27 filed 500,000 shares of capital stock
(par $1).

March 27 filed 300,000 shares of common stock
($1 par).
Underwriters—Not underwritten. Company has granted

issue of March 14.

March 21 filed $23,500,000 first mortgage bonds, due
1976, and 101,000 shares of cumulative preferred stock,
series C, par $100.
Securities will be sold at competitive
bidding, and interest and dividend rates will be filed
by amendment. Underwriters—By amendment. Proba¬
ble bidders include Halsey, Stuart & Co., Inc. (bonds
only); Smith, Barney & Co. (preferred only); Kuhn,
Loeb & Co., and Lehman Brothers
(jointly). Offering

existing facilities for manufacture of bumpers for pas¬
For details see issue of April 11.

senger automobiles.
i'1

•

Rights expire May 1.

&■ Pennsylvania Electric Co., Johnstown, Pa.

y-^-tpfraH+b < *«+/{•

2265

Rockridge Gold Mines Lid., Toronto, Can.

Kemerer

for

'..f-Spj.: ju'Vf' ■*** K^'

•» »'••*£* *'

'w*jr.v

THE COMMERCIAL & FINANCIAL CHRONICLE

THE COMMERCIAL &

2266

Thursday, April 25, 1946

FINANCIAL CHRONICLE
re

arrrfgy

w-rr-r'

■■.ui.ni'.

...

-vwr

•:>''y.r 4*5

Registration

Securities Now in

WfvlTiT??1

■%

INDICATES ADDITIONS SINCE PREVIOUS

f
(Continued from page .2265)
Utah Power & tight Co., Salt
March 20 filed $32,000,000

Veterans^ Air Express Bo., Newark, iN. J*

April 22 .(letter .pfmottfication) 173,250

LakeCity

ent

Bonds will be sold at competitive bidding with
filed by amendment. Underwriters—
Names by amendment. Probable bidders include Halsey,
Stuart & Co., Inc., and The First Boston Corp.
Offering
—Price to the public will be -filed .by amendment.
Bids
^Invited—Bids for the purchase of the bonds will be
received by company at Room 2033, 2 Rector Street,
New York 6, N. Y., up to 11:30 a.m. (SDST) on April 29;
.the bidder to specify the coupon rate.
For details see
1, 1976.

stockholders at $1

Canadian).

Angeles (4/29)

and tooling

1 C'

<■

For details see issue of Aug* 2, 1945.

'iT

r *! 'JW-

*<-/

' 1

and additional working

$50 per share and of the common

stocL|

$40 per share.

Proceeds—General funds for use in

opgvT

Ypllowknife Gold Mi nes, Ltd., Tor., C>nt.

fering—Frice ;to
funds.

Young Radiator Co., Racine,

details

Valley View Mines,

see.

Walworth Co., N.

capital

Jan. 29

Inc., Spokane, Wash.

April 17 (letter of notification) '200,000 shares common
Price to public 62%P per

Underwriter—

share.

Standard Securities Corp., Spokane,

Wash.

Wis.

fijei100,000 shares pf .cpmiAon §toqk ^pa?/|M

exercise of warrants.

Offering—Price to public $8.25 per share.

Co.

Y. (5/7)

J 0|

stock at $8.25 gyf
share prior to Feb. 1, 1951, 20,000 were issue «to stpGk|
holders on recapitalization and 20,000 are being sold'^
40,000 warrants to^urchase common

filed

registered 40,000 shares of common for issuance upoL
Underwriters—Van Alstyne, NW

also

Feb. 21. J

$4,500,000 convertible debentures (due
May 1, 1976, and 20,000 shares of cumulative convertible
preferred stock (no par).
Interest and dividend rates

March

public 30 cents' per share, United States

For details see issue of

of April 4.

For details see issue

ations.

1,000,000 abases -of aommpn .stock (par $1).
Underwriters—J. J. Carrick, Ltd., Toronto, Canada. Of¬

issue of April 4.

For

ferred stock is

common.

stock.

Yank

convertible series ,($15 par), and ,80,000
stock <$1 par). /.Underwriters—Bete-

additions

Francisco, Calif.

$lej 10,000 shares 4% convertible ;preferre<|
stock ($50 par) and lj501>6 shares common, (no paiv;<
Underwriters —-None named. Off ering ^JPrice of ;pi^-|

Feb, 13 filed

common

assets of

Offering—Offering price to public 28 cents

New York.

Eichler & Co., Los Angeles.
Offering^Price io
public is $16,625 a share for preferred and $5.25 a share

2?0>P.P0 sharps pf capital stock (par $!•?Underwriters—-IVillis E. Burnside . & Cp.,

June 24 file J

shares cumulative preferred stock,

Proceeds—Purchase of business and
Gaffers & Sattler and .Occidental Stoyp Co.;

Proceeds—Pur¬

1946.

Weeden & Co., San

jnan,

for the

share in ratio of 35 shares

March 28

per

Virginia Red Lake Mines, Ltd.

United States funds.

Utility Appliance Corp., Los

shares ;af class B

public by

redeem first mortgage

airplanes, facilities and equipment.

chase of

issue of March 28.

March 29 filed 80,000

amendment.
Proceeds—$4,590,OOfy'
4% bonds due April I, 1955$
$619,120 to restore working capital expended for re¬
demption of 6% preferred; $800,000 for improved faun*
dry and finishing equipment; $220,000 for acquisition
two warehouses; balance for working capital.
For ;<d&£
tails see issue of April 4.
~ *- Wi
to

Price

(4/30)

Offering—To be offered pres¬

(par $1).

for each share held on April 30,

interest rate to be

*$1 .dividend

stock

common

first mortgage bonds due May

ISSUE

t)ndeiwriters--iBaine, Webber, Jackson •v underwriters at 10 cents per warrant share. <>fferirt|
Rollins & Sons, Inc.
Offering—
postponed indefinitely. For details see issue of Feb. *

amendment.

Curtis and E. H.

(NOT YET IN

REGISTRATION)
"W.

INDICATES ADDITIONS SINCE

•

Air

Services,

Power & Light Co.,

Arkansas

Inc., New York

Little Rock, Ark.^

Centrat &Southwesi4Jtilities Co., Wilmingtoi

Del«
•
" |
Thiro;amended plan, filed, with $J3C in MarchiprpviCri
that Company be merged with American Public Service
Co. ®td ;c6rpdratioh Ikhowh as Central m Bouth-Wd
Corpi y Sufficient number of shares of new companj

reported company/ planned to issue 290,000
shares jcommoh stock ;(par $12.50) and $^Q0Q^OQO >Jn
March

April 1 company was reported planning sale of
shares of common stock through B.; G. Cantor

PREVIOUS ISSUE

150,000

-Co.,
New Yorki as underwriter;
Price about $2 per share.
Company's headquarters will be located within eight
/miles pf .New Tork City,
Rrh^ip^L bq^^ness wJU

current promisProbable
pidders include Billon, Read &IbCm The 'First Bositon Corp., and Blyth
Co., Inc.
student training and charter service.
po., frool^lyn, N. Y.
Alden's, Inc., Chicago, III.
i April 12 company^chas -arranged the sale of 100,000 shares
May 14 stockholders will vote on approving an issue of
pf common stock at $2\25 per share. Proceeds for e?c50.000 preferred shares (par $100).
First series of new
jpahsipn. lliideirivfitd^TB* 0' Cantor & Co., Now York.
preferred will consist of 40,000 shares, (dividend rate
not

exceed

American

Proceeds for working capital.

4%%).

JLehraan Brothers/and.

promissory notes, for purpose of paying
notes and (finance expansion ^

sory

associates will

Airlines,

•

be ^underwriters.

and

par) shares to 12,000,000 ($1 par) shares, to effect a 5split.
Probable underwriters include Emanuel
-Deetjen & Co. and Lehman Brothers.
,*

Corp., Philadelphia

April 16 reported that Alien Property Custodian may
shortly psk for bids Pn 535,000 shares (77.24%) pf the
/stock of .the corporation.
Probable .bidders include

gage/bonds, proceeds from the sale of which would *

Probable underwriters, Lehman

redeem, the $50,500,000 first mortgage 4% bonrls
now-Is expected to be delayed until all litigation AJ

used to

|ebrgahization is fconipleted. Burlier p^ans w^re

:the

fetirement of the bonds July
1.
_

the
_

stockholders

cUyi^/CW-, And Halsey, Sttiart & go.,
Columbia Gas &-JEUectric Corp,, New York

Beane (jointly).

Bangor & Aroostook RR., Bangor, Me.
April 16 stockholders authorized new mortgage.

April 12 it

pany contemplates
funded debt1

mately

Com¬
refinancing one-third of outstanding

SS'l

Co.tfW. E. Hutton & Co., and Halsey, Stuart & Co., «

man,

present plans to issue the stock. Previous under¬
writers for preferred stock included Morgan Stanley &
•/^Cd.,;;<Jhc.i/Dre3EeI::?&. Co., Mellon fSecurities >Cofp., ^Jlai;ris,
Hall & Co. (Inc.), and Spencer ^Trask & <Co. '

stated that in final step in recapitali^

senior securities and provide funds for .property e

of bonds under'new mortgage, through
competitive bidding.
Probable bidders include HarriRipley
Co., Inc.; Lee Higginson Corp., and
Halsey, Stuart & Co., Inc.

equal amount

April 23 stockholders increased common from 1,000,000
shares to 2,000,000 shares. Action is being taken to have
stock available if and when needed.
Company has no

was

corporation " is expected to sell appro
$100,000,000 debentures. to pay off .balance

tion program,

XJ)bc.|j31,through sale/of

New York

Three inyestme

banhing groups" were set '"up" to .enter competition"!
any new offering,
Kuhn,
Lpeb & Co.; Mellon
5^
t*-:.-- viz.;
- *
^
"

Glore, Forgan
Go. and Lehman Brothers (jointly),
pnd Blyth & Co., Inc., and Merrill ByhQhj#,i^e»

MilwaMkee Bl. JPaul k & Racific RR.

Issuance by the road of nqw lower-,cpupon, first mqr,

Atlas Jmperial Diesel

^hlcaBd

jEngine Co., Oakdale, Calif.
voted to split common, .stock
2 for 1 and create new preferred isue of 300,000 (par
$10) of which J50,000 shares would be issued and :sold
to finance purchase of constituent company, improve¬
ments, etc. Blyth & Co., Inc., probable underwriters.
O

Freres & Cf

(Joint); Smith Barney & Co.-Harriman, Ripley & Ci
(Joitit); JBlyth & Co.,*'Inc., Stone & Webster Security]
Corp.;anj First Boston Corp. (Joint).

stockholders will vote

working capital.

April

American Roach Corp.

American Brake Shoe Co.,

Forgan & Co.; Lehman Brothers-Lazard

Brothers.

for-1

/•

supplied, to retire outstanding .preferra
stocks of Central and American. Possible bidders: Glorl
not otherwise

on increasing common
300,000 shares, the new stock to be offered
stockholders at $10 per share.
Proceeds for expansion
stock

lnc., New York

April 17 stockholders. approved a proposed financing
plan which includes creation of 600,000 shares pew pre¬
ferred stock and changing common from 2,400,000 ($5

;

Artloom

July 16

provide fund,

would be sold at competitive bidding to

;

.
,

....

Consolidated Edison Co. pi New York, Joe.

•

needed.

cpmpany (name ,lo ,be changed ,tp Minneapolis
Gas Co.), under modified plan,approved by SEC, reserves

HrobAbJb'rW^oi^^s;1 Hincks Broi^

„

April 23 ctpckholders

Co.

American Gas & Power

March 18 stockholders granted jnenagementte request

Bridgeport (Conn.) Braos Qo
voted $o is^uo m additioh31y453yO0O^'"f
shares of common stock when and if .new capital is

debentures..Contemplate

refund $304,240,000-callable

April 10

Brooklyn

fight to make public offering "of not in excess of ,874,078
shares of new common

Langley & Co., .Otis & ?Co.
♦
American Rolling Mill Co., Middletown, Ohio
April 19 company reports that under a refinancing plan
now
being negotiated, it is expected that ^outstanding
$15,500.,000 .term bank loans wiU ibe,/retired jin pear
future.
Probable underwriters include W. E. .Hutton
& Co.; Smith, Barney & Co., and The First Boston Corp.

(N. Y.)

White, Weld ^ Co., W. C.

;
•

■'' '' ,Mich.
"
;

Union Gas Co.

Stockholders will vote May 7 on

Probable bidders -include

stock.

Consumers Rower Co., Jackson,

approving a plan to

refund $29,240,000 first mortgage 3Y2S and $11,850,000
4%/debentures.-? Plan is said ;to provide for $10,000,000
new preferred stock, mortgage bonds and
serial notes
'to Le sold through -competitive >biddmg.
Approval of
stockholders and New York Public Service Commission
necessary.
Probable bidders will include Halsey, Stuart

;

-X,

March J4 /filed With Middgen B» tU» 'Commission APpt
cation/to- sell at competitive bidding .876,563 commf
,

ushares, after capital adjustment. Proceeds for extensio*.

Plbb^la;kbidd^s...ii^ude- Morg^p ^tanley^jSc £94
man Brothers; Harriman, Ripley & Co., ana Mellon Si
-curites Coi^p.. (jjpintly).
^

& Co.,. Inc. (bonds only), Mellon Securities Corp.. and
Harriman Ripi^y /&/Co.
^^ - {?/o/
/»■/" x'
jj'a'
nL>i. j
■
L- ' " '
April J2 Columbia Gas & Electric Corp. filed plan w
(The) Budd Co., Philadelphia
SEC/to/disposenf 400% CQhimon'stockhqlding of Gay tc['
June 11 stockholders pf Edward G* Hudd Go., and, Budd yGo|qmbia Will a^^dmnionatocJqcif Haytqh dduts tCofi:
**

United States Government,

'iManv^aptwing wi11 yote <on jnerging, itheauryiying com"
pany torbe The Budd Co.- Additional capital would be
/provided through aale ,of .537,900 shares .of .common, stock
to be initially offered to .stockholders on >a one ior five
basis. New company would also sell $30,000,000 of de-

State; Municipal and
Corporate Securities

•

/nwih/stdckhQldersand proposes;yabdut May J1 ftp -ihyl
competitive bids to underwrite the offering. Bids w
be ^pen About May 20. GffeT \to atqckbqlders would i
main, open for«a 14-day period .ending about. June
Probable bidders include Otis & Co; Harriman Ripl

Blair 6- Co.
INC.

y-r-^.r

..consic

NEW YORK

BOSTON

*JB1JFFALO

PHILADELPHIA

CHICAOO

PITTSBUBGrf '

•

CLEVELAND

" ST. LOWS
—vr

negotiating ,with;
securities, prob¬

March 29 company announced it vw8s
underwriters for sale of $20,000,000 of

10-year ..debentures, proceeds j;o
-meet cost of proposed expansion /program.
ably

Inc., probable-underwriter.

refi^anblnS
$65,000,000" 3 V2S and 4s./ /Probable bidd
inclUi|e:;/M#9b/ Securities iCorp.^ /F)irst vBpajtbtl iCor

to
Blyth & Co.,
be >used

Dillon, Read & Go* Inc.,1 Cpffin ^& Burr,

",Co,f
Jnc.,
andsSpencep*Trask
'f
t'OV;
/ *' *
'*
'
h."
J' ' & Co.
/K
.*

.7^

'l'-'

(

•

- »

+.' -

*'
'• "

• • "

Paso

4% % cuihulative preferred stock (par $50). -New pre¬
ferred if sold will probably be underwritten by Allen

JKOiural Gas Co.

4 l>ril 11 ^OroOO^OOi firiahcing1:
jbncls and preferred and

mission

;

dividend rate/ Possible bidders include Halsey, Stuart
& ,Co.y Inc., -and Salomon Brothers & Hutzler. /
v;
Light Co., E. St. Louis, III.
April 9 comiJahy rannounced that it is>giving considera¬ ^ /Philco Corp., Philadelphia /•'
: : /
tion to refinancing outstanding senior securities.
Com¬
May 17 stockholders will vote on increasing capital
pany has outstanding 50,000 shares $6 preferred stock. Istock from
2,000,000 shales of common to a total of
Probable bidders include The First Boston Corp.; Blyth
3,370,057 shares, consisting of 250,000 preferred shares
& Cd.»
/ (par $100), 2,500;000 common shares (par $3) end 620,057
iKidde$".PeabodytCo.-),^S-;■■■;1
class B stock (par $3).
Mountain States Telephone & Telegraph Co.,
Purpose is to secure permanent
/
>
capital as may be required for future expansion. Smith,
Denver, Colo.
wX/;'•
IBariiey
to
Co,
probable
underwriter
if "sale of securities
jMarch/30;:|it; Was ^rebbrted
^;c6mpan^;i^reUa^
takes place.
to issue $30,000,000 new debentures/Morgan Stanley &
'

common

program has approval of

•

and stockholders.

'ftSGen^rwy^

-:
At>ril 19 reported early? registration of $3,000,000 4%
convertible preferred stock (par $50).
Underwriter,
Paine, Webber, Jackson & Curtis. r
*

Co.

stock possible when
Federal Power Com¬
Probable ppder^riters in*
£lud.e White, Weld & Co.; and Stone & Webster Securi¬
ties Corp.- r^uU>mi 2 ,J

Expansion

Bids will be Opened at noon and no bids for less than
will be considered.
Successful bidder; -will name

Missouri

Power &

General

Telephone Corp., New York
April 17 stockholders approved amendment to certifi¬
cate of incorporation modifying restrictions against in¬
curring debt for capital purposes without specific stock¬
holders' approval.
Stockholders also approved amend-;
thent to authorize 175,000 additional preferred shares.;

Go. and Halsey, Stuart. & Co., Inc. are

probable bidders*

Pittston Co.,

Hoboken, N. J.
New England Gas & Electric Association^ Canv -Company It is understood expects to register at an early
/date for public offering an issue of 15-year debentures
;
bridge, Mass.-v
v'r; >.•; /*; '>'v| /'-^v *
and additional income debentures.
March 27 filed amended recapitalization plan with SEC
Probable under- •
Probable bidders include Paine, /Webber; Jackson &
providing for sale at competitive bidding of (a) 22,- /{writers, Blair & Co.: )
■
'
/ ;
ourtisj /J;,;/
" r' ~r" /
.* / "* «**• -'; ■ •;.;" *■ •' " ♦ - - *
* 500,000 20-year sinkihg fund collateral trust bonds^ plus
•Rochester (N. Y.)' Telephone Corp.
(b) sufficient shares of new common stock out of the :
The New York Public Service Commission has author¬
1 Weyden Chemical Corp., N. Y.
original issue of 2,300,000 -shares to supply $11,500,000.
ized the sale to Halsey! Stuart & Co<, Inc., of $6,238,000
IVfay 3 stockholders will vote on financing program
Proceeds Will be used to retire at par and interest out¬
35-year 2%% first mortgage bonds at a premium of
filing for-2^-for-1 splitnip of common stock and
standing debentures. Bidders may include Halsey, Stuart
authorization of 200,000 shares of new preferred stock
$32,000, under agreement that corporation shall offer
& Co., Inc. (for bonds only), Bear, Stearns & Co. (for
bonds at competitive^ sale within 90 days, and if better
(bar/$100]ri ,; Company;:intends to) JisSUe from ^80,000 to.
stock only), First Boston Corp., White, Weld & Co.offer ris received, it shall reacquire and dispose of the
120,000 shares <>f hew preferred anat use part of proceeds
Kidder, Peabody & Co. (Joint).
bonds to the best bidder.
t6 retire $4,800,000 4%..preferred stock now?hutstanding ,,
Previously ; the Commission
£
Nashville Chattanooga & Si Louis Ry.
denied corporation's petition to sell the issue privately.
^hd the balance for new capital purposes.
Probable
April 24 company has under consideration plans for
Underwriters include. A. G. Becker & Co. Inc.; Lehman
•
sale on May 9 of $15,000,000 new bonds.
St. Louis (Mo.) Public Service Co.
The new issue
Brothers; Merrill Lynch, Pierce, Fenner & Beane: Hornwill be designed to provide funds for retirement of the
blower & Weeks, and Ladenburg, Thalmann & Co.
April 19 Company has petitioned the Missouri Public
outstanding first 4s, due 1978. Probable bidders include
Service Commission to simplify its financial structure, /
Halsey, Stuart & Co., and Kuhn, Loeb & Co.
Hudson Motor Car Co., Detroit, Mich.
including reduction in interest arid sinking fund changes.
'

••

April

directors voted to offer stockholders rights to

subscribe for one additional share for each seven

held, requiring approximately 228,000 shares. Proceeds
f/or working capital.
W, E. Hutton & Co. will be

due 1951.

underwriter.
•

able

Decatur, III.
April 11 company filed plan with SEC to simplify capi¬
tal structure. Plan contemplates the conversion of 5%
cumulative preferred stock (par $50) into common stock
on basis of two common shares for one preferred.
Com¬
pany states underwriting is available for this conver¬
sion program and will cover a 30-day commitment to
purchase enough additional common to redeem any pre¬

industrial Rayon Corp., Cleveland,,

March

stockholders

Southerh Natural Gas Co.

was

Compahy1 is Ihvitirig bids for the said of $15,000,000 1st &
ref. mtge. bonds series B and $45;000,000 1st & ref. mtge.

4%% bonds due 1975 and the issuance of

bonds

collateral

•

common

trust

bonds.

a new

Prospective bidder,

series,

Northern States

Power Co.

ern

States Power of Minnesota, "operating company, into
8,216,228 shares of common, all of which will be owned
by the Delaware parent and distributed to the latter's
preferred; and common stockholders.
The stock to be
distributed would be equal to the call price of the pre¬

International Minerals & Chemicals Corp.,
Chicago,., lilt.
,
May 20 stockholders will vote on approving sale of 145,,

•

unissued

common

stockholders- rights

shares;

proposed to give
purchase' additional shares on

ferred stock and

White, Wejd & Co. wijl be underwriters..

Arkansas

Ry.

Michaels

clude

public

the

stocks.

Delaware

company's

Probable bidders include

result of

1st

possibility.

of $100,000,000 bonds in the
country's financial needs has be¬
Probable underwriters would in¬

Lazard

bidders include Kuhn, Loeb
& Co,, Inc.

•

Oklahoma Gas & Electric Co., Oklahoma City
Company contemplates at same time Standard Gas &
Electric Co. sells its holding of common stock (in ac¬
cordance with SEC regulations) to sell approximately
140;000 shares of new commoii stock, proceeds of which
will be used to reimburse treasury and retire bank: loan

used*in "redeeming* the-1% preferred stock.

Probable

bidders

will include Merrill Lynch, Pierce, Fenner &
Beane; The First Boston Corp., and White, Weld & Co.

Rivers,
•

Uniori Electric Co. of Missourl

$3,500,OpA'

::
D Pehil^ylvania Edispn Co., Alioona^ Pa.i
14,000 pre-,
March 28 company applied to the SEC for permission to
(c)> $400,000 conimoh stock
issue (a) $23,500,000 first mortgage bonds series of 1976,
(par $10)* All issues would be sold through competitive
and (b) 101,000 shares of series C cumulative preferred
bidding.
Probable bidders include Blyth & Co., Inc.;
stock, With a dividend fate not to* exceed 4%. Both
Kidder, Peabody & Co.; The First Bdston Corp.; Harris,
issues; are to be sold through competitive bidding. :ProbHall & Co.v (Inc.); Merrill ^Lynch, | Pierce,' Fenner to
nble bidders includeaMeilon Securities/ Corp*; Smith,
Beane, and Ira Haupt & Co.
SEC lias set April 25 for.
Barney & Co., Kidder, Peabody & Co., and Merrill Lynch,
hearing on plan.
1 - -, '*
Pierce, Fenner & Beane.
: L
v

first mortgage bonds due April 1, 1976, (b)

ferred shares (par $100) and

lefundir^ lts

It iS luriiored that company .contemplates

outstanding $90,000,000 3%s of -1971 with lower cost;/
obligations. Possible bidders WOuld iriClUde pUlon, Head
:; to
:Co^lu%

^^jI^e$:f:Stu^;to/C04 Inc.

•

United Printers & Publishers

Inc., Joliet, III.
Stockholders voted to increase authorized;
common stock (par $l):frpm 400,000 shares to 1,000,000;
shares.
Company- contemplates sale of 165,656} addi-/
tiorial Shares, proceeds of which will be used to redeem
at $35 a share outstanding 100,000 $2 preference stock.
Probable underwriter A, C. Allyn to Co.

April

•

United States Radiator Corp.*

Detroit

April 24 annual meeting adjourned to May 15 when new
plan of recapitalization and refinancing should be ready
for submission to stockholders. Previous plan rejected
by stockholders March
White, Weld & Co.
Western

1 last.

Probable underwriters,
<

Pacific RR.

April 11 ICC conditionally authorized company to issue
$10,000,000 first mortgage bonds, series B, due Jan. 1,
1981, proceeds to be used to refund a like amount of
first mortgage 4% bonds due Jan. 1, 1974, and held by
RFC.
Interest rate to be specified in bids.
Probable
bidders include Blyth & Co., Inc.; Bear, Stearns & Co.;
Halsey, Stuart & Co. Inc.; Merrill Lynch, Pierce,
ner & Beane; Shields & Co., and Glore, Forgan &

Co., Toledo, Ohio

March 21 filed with Qhio P. U. Commission application
to sell through competitive bidding 204,153 shares of
common stock.
Proceeds for expansion, etc. Probable
bidders include First Boston Corp.; Glore, Forgan & Co.;
White, Weld & Co.-Shield & Co. (Joint); Morgan Stan¬
ley & Co.
'
'
:

A" f I

■

informal discussions

offering

Ohio Edison

April 8 it was reported comoanv plans new financing,
through common/stock,* with;/ Burr \ to Co.: * as under-.
•writers.' Mil oh t*.
.
e? ab|rd

:,A

Freres & Co., Inc.; Kuhn, Loeb & Co.;
Glore, Forgan & Co.; Kidder, Peabody & Co.; Laden¬
burg, Thalmann & Co., and Halsey, Stuart & Co. Inc.

April'1filed with {SEC application M5eU

reported that

the

come

Brothers, New York1

;p Michigan

common

autumn to meet that

Company, manufacturer of various electrical relays and
clocks, is reported planning the sale of 100,000 shares
stock through B. G. Cantor & Co.
Price
>

holders

between representatives of Norway and American bank¬

Corp.

•<

ers,

/of common

about $3 per share.

C.
Bids will be accepted up to 12 noon
May 6 at company's office, 165 Broadway,

Norway, Kingdom of
It

Electronic

offering price of the Min¬

Lynch, Pierce, Fenner & Beane; Paine, Webber,
Jackson & Curtis, and Blyth & Co., Inc.

Mtge. 5s. Probable bidders, Halsey, Stuart & Co., Kidder,
/Peabody & Co., and Kuhri, Loeb & Co.
Kurman

present

class A and B

Ry., Kansas City, Mo.
) May 14 stockholders will vote. on proposal to issue
$14,000,000 additional first mtge. bonds as part of program
&

The

bonus.

Merrill

Kansas City Southerh

Louisiana

and

Jersey Central Pwr. & Lt. Co., Asbury Pk„ N. J.
April 17'company filed refinancing program with SEC
Twhich, among other things, provide for the sale at com¬
petitive bidding of $34,000,000 first mortgage bonds and
145,000 shares of new preferred stock.
Probable bid¬
ders include Bl.yth & Co., Inc.; E. H. Rollins & Sons,
Inc.; Eastman, Dillon & Co.; and W. C. Langley & Co.;
/Merrill Lynch, Pierce, Fenner & Beane-Whnce, Weld &
Co: (jointly); Glore," Forgan & Co., and The First Boston
Corp.

refund ,,$14.000,000

nesota common would be determined by negotiation be¬
tween representatives of the underwriting syndicate

; basis of one new share for each five common shares held.

New York City, Probable
to Co.* and Halsey, Stuart

Minnesota

in 1944.

834

series

(EDST)

Morgan

future expansion.
Kuhn, Loeb & Co., Harriman, Ripley
and associates underwrote preferred financing

Jit Co.

Texas'to N^W:Drleans-' RR,'::^\ •/V

•

reported April 10 that company has under con¬
sideration the refunding of $55,000,000 collateral trust

April 23 Lehman Brothers; Riter & Co.; Lehman Corp.,
and Overseas Securities Co., Inc., submitted to SEC a
draft of a proposed reorganization plan for Northern
States Power Co. (Del.) which provides for a "stock
and option to sell for cash" method of distribution.
Plan provides for reclassification of common of North¬

Company: has under consideration a plan for refunding
its approximately $15,000,000 of mortgage bonds and
serial notes outstanding, stockholders were advised in
the annual report for 1945. Probable underwriters in¬
cluded Halsey* Stuart to Co., Inc.; Kidder; Peabody to
Co. and Blyth & Co., Inc. (jointly);
< '

Stanley & Co., Halsey, Stuart & Co. and Kidder, Pea¬
body & Co.

Co.

1,200,000 shares (no par) to 3,000,000 shares (par
$1)1 The outstanding 759,325 shares; were split 2 for 1,
increasing outstanding shares to 1,518,650.
Unissued
shires will be available for issuance when needed for

Halsey,

Northern Pacific Ry., St. Paul, Minn.

from

■

and

Ohio

authorized

increased

(Company proposes

(par $50)
provide cash to
pay dividend arrears certificates, ($11,596,680).
Prob¬
able bidders include Merrill Lynch, Pierce, Fenner &
"Beane; Otis & Co., and the First Boston Corp. -

Co.,

April 17 reported that company has under consideration
the refunding of its $45,000,000 series C 3yss with issue
of about same size carrying lower coupon rate. Probable
bidders, Halsey, Stuart & Co. Inc., and Harriman, Ripley

shares to

common

underwriters, Hayden, Stone &

limited originally to $6,000,000.
Probable bidders in¬
clude White, Weld & Co.; Blyth & Co., Inc., and First
Boston Corp.

Probr

Northern Indiana Public Service Co.

issuance of 200,000 shares of new preferred
and such additional,

New issue will probably run 25 years.

Stuart & Co., Inc.

Illinois Power Co.,

ferred not tendered for conversion.

Cohipany prOposei to retire current funded debt
640,683) and to issue Up to $10,000,000 new bonds, but;

•
New York Dock' Co., N. Y.
April 24 reported negotiations will be resumed within
month for refunding of $10,000,000 first mortgage 4s,

•

Wisconsin Power &

Light Co., Madison, Wis.

April 23 under dissolution plan of North
Co.

filed with

Fen¬
Co. |

West Utilities

SfcC, Middle West Corp.x(parent), pro¬

to invite bids for sale of not more than 32,000
shares of common stock of Wisconsin, as would not be
distributed to stockholders of Middle West. Probable
poses

bidders include Merrill Lynch, Pierce, Fenner to i-Beane,

White, Weld to Co., Glore, Forgan to Co.,. and The Wis¬
consin

co.

Yonkers <N.

Y#) Electric Light & Power Co.

Jan. 21 company and parent .Consolidated Edison Co.. of
New York, Inc. applied to New York P. S. Commission

/issue i $9,000,000 - 30-year debs., int. rate
2%%, to be guaranteed by parent. Issue
to be sold through competitive ,bidding. Possible bidders
include Halsey, Stuart & Co., Inc.; Morgan Stanley &
Co.; Lehman Bros., Harriman Ripley & Co. and Union
Securities Corp. (Joint); .Blyth & Co., Inc.; Shields &
Co. and White, Weld & Co. z&oiht)! W. -C. Langley &
for authority to
not to exceed

Co.; Merrill/Lynch, Pierce, Fenner to Beane and Kidder*
York County

(Pa.) Gas Co.

Directors have approved a tentative financing plan under
which all present debt (Dec. 31, 1945/42.482.300) tyould

Miller-Wohl Inc., New

York

Rere Marquette

-May 1 stockholders will; vote On approving a split-up
of conMoh/stocfc^
^ creat|on^^ of:40,000 "sharOs of^fiew

„

April 25/pompany will

Ry.
open

bids for purchase of $1,300.-

000 issue of serial equipment trust certificates of 1946.'

in addition to issuance of $450,000:bank
shares of Pennsylvania-Gas &
i Electric Co. preferred now owned, calls for the sale of
be retired. Plan,

loan and .sale

of 3,660

$1,700,000

first mortgage bonds,

new

-/;

CHRONICLE

THE COMMERCIAL & FINANCIAL

shift for themselves, they were
quoted around 97 y2 hid.
The

Our

effect

bidding for

sev¬

currently in

eral large new issues

prospect; will be* interesting to
watch since it is widely assumed
that the setback in governments
will be reflected in the calcula¬
tions of banking groups which will
be in the running for such issues.

Reporter's
Report

Bids

Three Issues Up For

Among the first sizdble under¬

of last

The tremendous success

winter's Victory Loan

takings to come up for considera¬
tion under the revised conditions

decidedly

marketwise,

from

Drive made
encouraging reading,
Treasury standpoint, at the

But

time.

small

the

and

situation is

heard recently;
however, by way of complaint
from investors of the prohibi¬
tive yields on corporate issues
brought out since that time. So
that if the net result of the cur¬
rent setback in Treasury; bonds i
is to afford a slightly better
,

hasis of return, it may work out
to be a blessing in disguise. But

Monday

highest bidder

to have hapopened,; according to observers,
is that the huge speculative in¬
terest which participated in the
rolling up of the vast Victory
Loan subscription total, is how "
complete its "free-

Since

Want * to

the:bonds.

benefit

its

run

course

point to 1^

060 of

2M%

new

this

month

With

the

sponsoring syndicate dissolving
this week and the bonds left to

He was formerly

Street.

Railroad

Harris, Upham &
Chicago for many years.

,2232

Ohio Securities Section on page

—.<',7,.

Trading

Teletvoe

Markets in

1-1397

potential candidate for entry into
the money market again in the
near future. The company is re¬

Thompson's Spa
Units

Kropp Forge
Kut-Kwick Tool

Bandit Home Appliances

Majestic Radio ^Television

Clyde Porcelain Steel

O'SuIIivan Rubber

Dn Mont Laboratories

Sheraton Corporation

RALPH E CARR & CO.
'

Globe Aircraft

Telecom Corporation

Greater N. Y. Industries

Wilcox-Gay Corporation

Boston

New York

Hubbard 6442

H.norer 2-7913

We specialise in

Company &

Kobbe, Gearhart
*

INCORPORATED

Members New

45
;

NASSAU

York

;

•.

■•W-.v*.

: •••

•

v:;;

-C;v:

Investment Trust Issues

BUUf TELETYPB
1-576

TEXTILE SECURITIES
Securities with

New

A Market Place for

the first and
refunding bonds which are out
against the properties.
undertaking

Tie

launched, it is expected that the
parent company would apply the
proceeds from the sale of the new
issue to the redemption of other

Low Priced Unlisted

Aircraft & Diesel Equip.

Jardine Mining

Bendix

Kinney Coastal Op
Lava Cap Gold
Martex Realization

Helicopter

Cosmocolor

Petroleum Conversion

Now Heimerdinger

Differential Wheel

Red Bank Oil

& Straus

Electric Steam Sterilizing

Reiter Foster Oil

has been ad¬

Straus

partnership by Leonard

Specialists in
England Unlisted Securities

Tele. BOston 23

TeU HANcoek 8715

SIMPLEX
PAPER CO.
-

Gaspe Oil Ventures

Shawnee Pottery

Haile Mines

Standard Silver & Lead

Harlow Aircraft

United States Television

potential postwar bene*
ficiary of the:
^

and

Frozen Food
Industries.

Morris Stein & Co.

***

Established 1924

HANOVER 2-4341

Only

TELETYPE—N. Y. 1-2866

small issue of com*:

stock.

mon

■

***

Recent Price

•

Write

FOREIGN SECURITIES^

s\
a

SPECIALISTS

148

Active

Sunshine Consolidated
..

■

Pressureluhe, Inc, ■ • ^

Automatic

U. S. Radiator, Pfd.

Reiter-Foster OU
-«

Special Reports

W. T. BONN & GO.
120

Broadway

New York 5

Bell

Teletype NY

1-886

! '

l *"•

BO 9-4613

Boston 18,; Mass.

Request

Tele. NY 1-1448

Teletype BS 250

Genera! Products

^Susquehanna Mills

Empire Steel Corp.

CHICAGO 4

WESTERN UNION TELEPRINTER

"WUXM

•

request

REITZEL, INC.

REMER, MITCHELL 8c
208 SOUTH LA SALLE ST.,

Corp.

'■

*Prospectus
'~V'

New York 5, N. Y.

St. :

BOUGHT—SOLD —QUOTED

Amos Treat & Co.
40 Wall

Telephone COrtlandt 7-0744

Works

Worts

Van Dorn Iron
'

; J

•'

Signal Common

^No^ern Ehglneering

:rv,;V- /.v

Bonds, Preferred and Commoi^ ^Stocks

Amer. Bantam Car Common

St.,

0425

Lumber & Timber
■-■V.

Trading Markets

State
CAP.

Utility—Industrial ~~ Real Estate

•

Insurance'
Tal.

Puklic
Public

■

Bank

CHICAGO

NEW YORK

call for descriptive

or
analysis.

Specializing in Ttnlisted
Ttntisted Securities

rm marks & r.o. Inc.

■,

10/^

•

Preferred

Automobile,
Building,

MINNESOTA « ONTARIO PAPER CO.

BOSTON 10

Established In 1922

Holding

Automatic Signal

Copper Canyon Mining
Duquesne Natural Gas

New Eng. Market *

24 FEDERAL STREET.

Securities

Huron

higher cost obligations of the

system.

Frederick C. Adams & Co.

about $64,000,000 of

this

Stocks and Bond*

Public Utility

•'> i/:.-

NEW YOKE

all

Industrial Issues

YORK

NEW

PHILADELPHIA TELEPHONE
Enterpbise 6015

TELEPHONE

Security Dealers AssodatUm

STREET,

^'!i.•. *:■

REOTOB 2-3600

Tsletrs*
BS 328

Insurance and Bank Stock*

Co. Southern Pacific now owns

Should

Milk Street, Boston 9, Mass.

**•

6% Ffd. & Com.

Buckeye Incubator

*faXK<r?..

project now under dis¬
prospective
sale of $60,000,000 of new bonds
secured by the properties of the
Texas & New Orleans Railroad

Int'I Resist.

Ironrite Ironer Com. & Pfd.

& Pfd.

Lear Inc.

ported to be considering advisa-.
bility of refinancing substantial
amounts of its outstanding debt
if it can be done at a saving of

Trading Markets

San-Nap-Pak?

Sheraton Corp.

ffetSS

BROWN CO.

Auf%

HA. 2-8780

Exchange PL, N. Y. S

Y. Security Dealers

"Securities Now in

♦See tinder

Helicopter

Bendix

Teletype—N. Y. 1-971

1919

ESTABLISHED
memoKTs

Baltimore Porcelain Steel

Southern Pacific Co. looms as a

Common

& CO.

IEN

Markets—Walter Whyte

^Registration" oh page 2362.

,V.

Firm

2224

■.Says'.......... v...... ..............2230

SO BROAD ST., N. Y. 4
HAnover 2-0050

Corp.

Cinema "B"

Securities Now in Registration...,. .2262

Co., in

with

Pacific

Southern

Heimerdinger and the firm name
of Heimerdinger & Romero has
been changed to Heimerdinger &
Straus. Antonio Romero has with¬
drawn from the firm.

marketed early
100.

Adams

and
$9,000,000 of 20-year debentures.

mitted to

Is' Great

point

Securities...........*.2220
Securities
.2234

Tomorrow's

,H.
Murray has become affiliated with
Ketcham & Nongard,
105 West

for its projected $54,000,new Issues, consisting of

Curtis
case

Chronicle)

111.—Rowland

Pnblicker Ind.
"Mexican

Report.'....*»...f...2268

Securities Salesman's Corner.......

$45,000,000 of 30-year bonds

points.
Northern Railway's recent issue

Our Reporter's

Governments..... ,2227

:Real Estate Securities

considering bids of banking

and

sympathetic easing of high-grade
corporate liens in the wake of the
let-down in Treasuries. Many such
issues have eased

Public Utility

And on or about the same day,

out of the

general and

Mr. Walker
was'with Baker, Simonds '& Co.

1981.

Uncertainty on that score ap¬
pears to have been keeping large

been

Our Reporter, on

Artkraft Mfg. Com.

though

Corporate Issues Ease

.2223

NSTA Notes

(Special to The Financial

Scophony, Ltd.
US. Finishing

.2228

previously with L. F. Roths¬
& Co.- ini New York; :Mr.;
Hinds was with the National Bank

With Ketcham & Nongard

American Molasses

..2251

Municipal News and Notes..

of Detroit; in the past

Rhodesian Selection

.2222

mendations and' Literature.v. .'.

Mutual Funds

Mr. Culman

Building.

child

of new mortgage
scheduled to mature In

The

selling pressure.

Co.,

..:,

SectfJlties.. V »»*..f. .;;;..2230
Dealer-Broker
Investment Recdm-

Canadian1

was

Amalgamated Sugar

of it has been completed.

There has

mortgage,

cussion involves the

market, thus making a lack of demand quite as important a factor,
if not more so than the actual

Livingstone

$44,000,000

market observers feel that much |

institutional investors

Penobscot

bonds

possible
that the bulk of the selling has
to

issue of $32,-

Bank and Insurance Stocks........2226
Calend^ ot ITotsS]&curtty Flotations;.;

•

months' tax clause, it is

yet

interest costs.

traders will
by the six

such

many

with

Consolidated Gas,
Electric Light & Power Co. of
Baltimore will open sealed bids
for
its
projected offering of

market.

appears

ride*' through sale Of

(Special to The Financial Chronicle) '

England Public Service

Gaumoht-British "A"

On Tuesday

high as 10617/32s are currently
around 10414/32s—is to unsettle

inclined

Power

of new first

000,000

groups

slip in governments—the Victory
Loan 2%s which sold recently as

What

Utah

bonds, due May 1; 1976. ■;

the effect of the severe

the corporate

I' DETROIT, MICH. — Frederick
Culman, Robert E. Hinds, and Lee
D. Walker have become associated

Illinois Power Co. probably will

that remains to be seen.
now

early next

sale

for

Light Co. is slated to sell to the

now

Much has been

Just

three bond offer¬

■

Page

•

CHICAGO,

"ricocheting" to the detriment of
the investment market as a whole,.

■

are

week.

piling up

the

part

orders

played

slated

ings

that

now

appears

buying

speculative

&• Co.

New

INDEX

With S. R. Livingstone

•

PHONE RANDOLPH 3736

BEU

SYSTEM TELETYPE CG-989

Hill, Thompson & Co., Inc.
'

Markets

120

and

Situations

Broadway,

Tel. REctor 2-2020

tor

Dealer*

New York 5
Tele. NY 1-2660

Full text of Commercial and Financial Chronicle : April 25, 1946, Vol. 163, No. 4484, Section 1

FRASER