Full text of Commercial and Financial Chronicle : August 1, 1957, Vol. 186, No. 5660

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

ESTABLISHED 1S39

i V L h,

U N

OF

V

1

1

MICHIGAN

/ 1357

AUG

1UC. u. 8. Pat. Office

Volume 186

Number 5660

New York 7,

Price 40

N. Y., Thursday, August 1, 1957

See
That

remarkable

aggregation of mystifying
terminology and astronomical figures commonly
known

as

the ' National Accounts" has

now

and the late Senator Taft's joint
'

fundamental issue of

by the Department of Commerce covering
year 1956. Estimates or guesses long current

about

most

of the

more

important statistics

we

con¬

are

at

expressed about automation's impact

come

about via currency

excessive

public debt

we

as

practice

the British
The world is

3resrly

has

ever

entering

before

history of human life,

We

billion

radio-TV, retail trade, steels, tires, and utilities.
Liquidation hits airlines and natural gas.. Mixed attitude
includes
aircrafts, building, ' chemicals, • electronics,
paper,

Cites,.
warn

metals, oils, rails, and tobaccos.
Tables appearing on pages

of

space

other

in which

faculty

scope

stock transactions

mon

and power.

This

dimensions.

not hear it;
panoramas

The

sometimes

sounds

tick

of

evolution

the

clock

page

to

503, with

intervening

an

14% from the March quarter, and their excess over sales

31.9%.

by

In

the latest quarter they repre¬
compared with
Dollar holdings of net
increased by only 3.5% (after

of all buying transactions,

32.2%

36.7% during the March quarter.

softly we do
yet we now know the hour has struck. Vast
will unfold before us, wave following wave,
on

475

As

decreased
sented

so

Continued

from

rose

lessened their defensive
revealed in our Table of Security Trans¬
actions, during April-June 1957, 67.8% of all new buy¬
ing of portfolio securities went into common stocks,
against 63.3% during the March quarter. Despite the
lure of higher yields on senior securities, the dollar pur¬
chases thereof, although still substantial, declined by

quietly and natural¬
ly—without ceremony or undue em¬
phasis, without great debate or acid
controversy—that we hardly know
the
exact
instant that the
change
occurred.

Stocks

policies.

has happened so

Douglas MacArthur

groups.

managements again somewhat

exploiting, not only scientifically but
practically, thq cosmic- ienergy. We
are
graduating from earthly to uni¬
versal

by industry

high of 513; and Moody's Average of Corporate Bonds
registered a further 5.9% • decline, and the Index of
Preferreds Stock prices fell 7.2%, investment company

greater

ever

an

com¬

During the second quarter, April 1 to June 30, between
which dates the Dow-Jones Average of Industrial Com¬

has
assumed

sun,

for learning
new

acquiring

are

the

from

21 and 23 show Funds'

investment positions; total common stoch and
securities transactions; and individual common

parative

2-billion-year

years

Great diver¬

holdings of senior securities.

drugs, finance companies, food, insurance, machinery,

degree of control and mastery over
the processes of nature. We are now

cash

and

governments

capital gains distributions).
Our Table showing the Average Allocation of Assets

37

to

Cash

Items.

Defensive,

and

Securities, shows
in defensive se-

Risk

further that the June quarter's decline

of self-gratula-

•From

32

IN

5

such immense

put of the people of the country at market prices.
The continued and in fact rapid rise in the size

PICTURES

in the

man's

usually referred to as GNP, or Gross National
Product, which may be defined as the total out¬

page

tries

virtue and treat

the

in

although still

of individual management policies noted. Indus¬
favored include farm equipment, autos,; banks,

gence

of evolution greater than

Never

vacuum

surprising number of people appear to be
least with the name of the quantity

on

substantial

stocks^along

common

somewhat reduced

the earth has spun through the black

familiar at

Continued

an age

known.

of

maintenance

people about the dangers of inflation.

great trouble be overcome, however,
worth the effort.

a cause

with

in danger of fulfill¬

as a

the greatest danger to be feared.

and the results are well

figure is frequently

are

economy

analysis of investment companies' port¬

operations during second -quarter reveals moder¬

ately stepped-up purchasing of

upon

Keynes' remark just before his death that he must

appearance of this document should,
other things, each year bring a fresh re¬
to the people of certain drastic (we had
almost said, tragic) changes that have come over
the face of things in this country. The tremendous
growth in the economy and the very large in¬
crease
in prices have so enlarged the. current
figures that comparisons with a year so long ago
as 1929 do not so readily yield truths which other¬
wise should be quite evident. Such difficulties

of this

folio

debauchment, fiscal bankruptcy,

taxation, and inflation,

unless

ment

among
minder

A

"Chronicle's"

creeping socialization

Warns that the prophecies of Marx and
Lenin, predicting the end of the American economy would

it

without

versus

power

employment.

the rank and file.

can

President Eisenhower's

manifesto regarding the

and spending. Believes
the threshold of the "age of plenty" and dis¬

misses fears

tained therein make it unlikely that any great
surprises will be found in the final figures, and
such indeed proves to be the case this year. The
fact that many of the concepts employed in this
gigantic statistical product seem to the uninitiated
to be rather aside from day-to-day affairs is in
part at least responsible for the circumstance that
important truth lies buried in these masses of
tables, and never comes fully to the attention of

The

liberty

by increasing government

V

Funds'Portfolio Policies

Sperry Rand Corporation

General MacArthur recalls part of

been

issued
the

By GENERAL DOUGLAS MacARTHUR*

Chairman of the Board,

Copy

lnv^men*ComPanySurvey

The Fundamental Issue"
f

a

-

,

.

EDITORtAL

Cents

Meeting

THIS

a

of

talk

by General MacArthur at the Annual Stockholders
the Sperry Rand Corp., New York City, July 30, 1957.

ISSUE:

Bond

Candid

Women's

Club

Continued

photos taken at the Annual Outing of the Municipal
of New York appear on Page 18.

on

page

DEALERS

State, Municipal

in

and

20

U. S. Government, r
Slate and

Municipal

STATE

and

Public

MUNICIPAL

Securities
TELEPnoXE:

COPIES OF

BONDS

HAnover 2-3700

CHEMICAL

FOREIGN

CORN EXCHANGE

Available

BOND

DEPARTMFNT

Request

THE FIRST NATIONAL CITY BANK

Burnham
MEMBERS NEW

30 BROAD ST.,

N.Y.




ARE

15 BROAD STREET,
CABLE:

and

Company

YORK AND AMERICAN STOCK

NEW YORK 5, N. Y.

COBUANHAM

Dl 4-1400

Members

120
Bond Dept.

Bonds and Notes ;

OUR

AVAILABLE

Teletype: NY 1-708

34

TELETYPE NY 1-2003

New

York

Stock

BROADWAY, NEW
offices

DEPARTMENT

BOND

REQUEST

the

Harris, Upiiam

OF NEW YORK

EXCHANGES
•

NOW
ON

BANK

Housing Agency

"MARKET REVIEW"

LETTER

on

;

from

coast

&

c-

Exchange

YORK 5
to

Chase Manhattan
BANK

coast

Municipal Bonds

CANADIAN
BONDS & STOCKS

for California's

Expanding
Economy

^
MUNICIPAL BOND

PoMBfiox Securities
6rporatio71
40

ExchangePlace, New York 5,N. Y.

Teletype NY 1-702-3

WHitehall 4-8161

DEPARTMENT

Bank nf-America
NATIONAL

JJVino? ASSOCIATIONS

300 Montgomery

St., Son Francisco, Calif.

2

The Commercial and

(474)

The

Banks, Brokers, Dealers only

For

participate and give their

experienced

highly

of Over-the-Counter

pled

MEItTON

Stock

bursitis;
Miles

Laboratories

pleasure

tranquilizer;
products.

Established 1920
Member

Wires

to

FRANCISCO

and
21/2 for

hundred.

say

120

his

Laboratories

Exchange

lieve

here, Miles

sincerely be¬
that this possibility exists.

that

in

formed

was

celebrated its 73rd

1884

Air Control

dend

Products, Inc.

Bank of

been

could

Colony Life Insurance Co.

No better illus¬

the

made of

sta¬

the

as

products.
Despite its rather enviable

pany

the

company

&

fellowships in Puerto Rico,
Germany, Japan, Sweden, Hawaii

and Scotland. A full time Research

Medical

Botany Mills

O. A.

it

1947
for

11

Sutton

lowing

the

37 Wall St., N. Y.

lf>30

Tel. HAnover 24850

com¬

Orders Executed

Exchange

Yucca

this

apparent

and

%
Mining
^

Miles
the

are

Bariuch-Kenilind

Co.

and

Miles

is

also

Beardsly.

Dr.

M.

H.

of

David

Dr.

Seevers

classified

It

La¬
en¬

forward

past

prior

a

stock

mon

around

Market and

These

sales

not

are

Ames

for

Division

such

of

items

up

following.

active

However,

a

its

bent

Ames,
also

involve
of

combined

with

is

Oil

common

Sales

Exchange)

Direct private wire to Salt Lake

and

expansion

pro¬

Fester

Wheeler

The

Per

Per

in

;

shown

Foster

Wheeler

strated

have much

a

positive*

and

modern

a

Norwich

Sterling

Bristol-Myers

$1,960,000

$3,400,000

S25,290.000

$11,460,000

None

None

None

51,060

1,883.000

*1.140.000

7.900.000

1.520.000

$29,510,000 $24,470,000 S177.700.000

$89,400,000

Plough

LO 8-0900
ATT

Teletype PH 30

John B. Stetson Pfd.

f

a

Pocono Hotels Units
Buck Hill Falls Co.

Guarantee Bank & Trust Co.

a o o v
com¬

Reading Co. 3%s, 1995

is enjoy¬

ing the largest

backlog in

Samuel K.
Members

many years,
in
both
the

shops and

the

engineering
and

Phillips & Co.

Phlla.-Balt. Stock Exchange

Pennsylvania Bldg., Philadelphia
Teletype
PH

N.Y. Phone
COrtlandt

375

7-6814

construc¬

depart¬

ments.

U

n-

doubte d 1 y,
will be

1957
S.

Lawrence

good

Vlaun

from

wish

not

equally

are

to

too

get

a

yea r

h0u«

earn¬

an

good.

new

I

far out

do

on

a

limb, but unless all signs fail. 1958

on

also

be

Foster

enough

ment

to

banner

a

Wheeler

give

reasonable

a

Currently,
into

two
the

vision.

mo¬

basij

r

Foster

Wheeler's

be

roughly divided
major categories; 50%

can

and 50%

working
the

at

for that prediction.

be¬

year

is

prospects

Process

Plants

Division

from the Equipment Di¬

The

former

plants

chemical

designs

for

and

refineries

companies,

while

the latter sells services and prod¬
ucts
which
are
in
demand
by
central

station

shipbuilders,
and

companies,
industrial concerns
power

government

agencies.

Prod¬

$3o

$18

$33

$58

'56

$2.03

$1.80

$1.05

82.14

$3.55

dividends '5(5

1.04

.90

1.35

1.75

erators, condensers and feed water

N. Q. B.
OVER-THE-COUNTER
INDUSTRIAL STOCK INDEX
18-Year Performance of
35 Industrial Stocks

ucts include industrial steam gen¬

.45

earnings

earnings-.

yield
since

i

12.4x

19x

17x

4%

2.6%

2.5%

1894

1925

1931

City
"15%

h

is

The

pany

constructs

want

24,000

$42,440,000

neeitr

one.

and

to

t

fully

v°ry

stockholder relations attitude.
seems

New York 6, N. Y.

Standard Pressed Steel Com.

appears

\v

Philadelphia 2, Pa.

CO 7-1200

ture for Foster

Management

supposi-

Broadway

re¬

shares

the

.

from

thus

Management has demon¬

115

justified. Overall, the present pio-

at stake.

tI,207,000

in

$25

share

Dividends

'5S__

price

Price-times
Dividend

shares___

millions

share

Per share

share*

Corporation

cently

1914

1529 Walnut Street

speculative interest

stockholders and

etc.

Established

Auchiinloss, Parker & Keilpatli,
New York City
Members New York Stock Exchange
And Other Exchanges

i.er, for

Miles Lab.

preferred

No.

Exchange PI., Jersey City, N. J.
Teletype JCY 119
N. Y. Telephone
Dlgby 9-3424

selective diversification,

a

$2,380,000

No.

VLAUN

S.

Investment Analyst,

volume

Bischoff,
a

should

Keyes Fibre Co.

un-

BOENNING & CO.
LAWRENCE

gram. This is being done aggres¬
sively but with prudence and in¬
telligence. The insiders are large

diabetes,

produces Aminet,

record

Textbook Co.

equaled stability.

various

of urine analyses,

detection

on

acquisition

Acetest,

products

the

dividend

Capitol Products Corp.
International

po¬

almost

as

tion

The management of Miles seems

con¬

Miles

as

capital gains

well

as

Continuing Interest in
Fischer & Porter Inc.

per year,

ings standpoint. Prospects for

market

solidated with domestic figures.
The

paying montblv di\ i-

excellent

tential

Bankers

Laboratories,

dends yielding about 4%
offers

Investment

-

-

present

President

too

H

com

price of $25
share in the Over-the-Counter

cause

were

Miles

<&

97

foregoing

business

had

archers

same

writer that the

of

its

the

•

111 Broadway,N. Y. 6 COrtlandt 7-5680

Net

from

Co., Ltd.

Tokyo, Japan

A
of

to the

Inc.

of

Yamaichi Securities

the

5%.

gain of 13% for the

view

York,

Affiliate

has

over

$1.09

to

rose

New

least the

up

write

Securities Company

period.

tion.

1957

were

information

or

moving

has

yet

offices

Yamaichi

could

course, is due to the fact that
Miles is an unlisted security and
as

ie

For the first six months

sales

share

largely compensate for this situa¬

of

t

year

improvement

year.

cents,

been

for at
each

years;

an

1957,

per

have

steadily

ten

shown

should

months

sales

of

a

six

in

of

Miles'

can

not

branch

our

current

Call

as

American Society of Phar¬

readily be seen that Miles
Laboratory is relatively attractive
as an investment in comparison to
the other companies. Most of this,

For

"sleepers" with
unique capital gains potentials.

per

to

STOCKS

indi¬

securities that

past to find

Beardsly.

Past

was

has

ability

drug field. (See Table)

Co..

well

usages

*C0.

Stock




domestic

Ames

Takamine

Debt

1

R.

unusual

Laboratory seems to com¬
pare quite favorably with its com¬
petition in the patent and ethical

Corp., Sumner

These

Alaska Oil & Mineral

Lake

the

Fund

Miles

Bumintest, Clinitest and Hematest.

ILeon Land & Cattle

Salt

of

Pioneer

an

enviable

noted

Pecos Exploration

CAPPER &

cated

very
rapid rate.
Last
month, Miles issued a release in¬

first

Cataract Mining

(Members

The

30.

apeutics.

to

foreign sub¬
sidiaries
in
Argentina, Brazil,
Canada, Colombia, England and
Mexico. Foreign sales are expand¬

44%.

tV

directors

wires

JAPANESE

developing in
Pioneer Fund added

portfolio, around the present
price, in the quarter ending June

dicating net foreign sales lor the

Salt Lake Stock

on

of

board

recent in¬

some

macology and Experimental Ther¬

trenched abroad with

at

five

Mobile, Ala.
Direct

10,000 shares of Miles Laboratories

of

NY 1-1557

owning Miles this

to its

fol¬

86

The

was

presumptuous

Chemical

boratory.

ing

the

In

company consists of a fine group
of capable men whose average age
is
53,' excluding the President,

rec¬

of

effects

important

subsidiaries

^Teewe^oxxvpoxv^

patents.

fied research program.

will follow.

more

Chemical

ESTABLISHED

be

not

Bischoff

the

years, Miles applied
patents,
This, I believe,
adequately illustrates the intensi¬

lor

called in. Some

was

already

are

would

The

Strategic Materials

S.

U.

Walter

of Miles

that

beneficial

assume

joined

There

interest

the company.

the

of the

move

Great Western Financial

has

United Kingdom.
five-year period from
through 1951, Miles applied

In

engineering
consulting firm of Booz, Allen

the

Director

company in the

Dr.

of

expansion program,
has research grants

death

fact

and Hamilton

Mineral

research

and

and
Oil

stitutional

be

New York 6, N. Y.

New Orleans, La. - Birmingham, Ala,

year.

In

and

keep

satisfied.

There has been

be

to

seems

In addition to its domes¬

research

the fine management,

Trading Mar kets

the

of

some

To rectify this situation

the

was

potential.

Alaska

and

double

to

progress

visit,

not realizing its fullest

of

aware

ait

to

HAnover 2-0700

10%; increase in the number

of stockholders

past

desire

a

than

more

a

Seever, Ph.D., 1V1.D., University ■ of
Michigan, was recently appointed
director
to the
board
of
Miles,
filling the vacancy caused by the

ord the management

33

very

on

the

of

Laboratories

tic

of

other drug and pharmaceuti¬

and

was

going

time

progressive

very

probably recall

manufacturer

in

was

research

minded.

cal

Lynchburg, Va.
LD

indicates

and

seems

every

Alka-Seltzer, Bactine, One-A-Day
Vitamins, Tabcin, Miles Nervine,

Scott, Horner & Co.
62

be

and

the

At

Miles

Dividends

each

reader will

The
Miles

Tele. LY

a

bility of Miles Laboratories.

Gas Company
First

paid

month since 1894.
tration

Alabama-Tennessee Natural

As

writer

work

manufacturing facilities.

is the proud

witnessed.

ever

have

Virginia

has

and

the

of more consecutive divi¬
payments than this writer

payer

has

company

birthday.

matter of fact Miles

Trading Markets

a

work

It
to

I

Inc.

facture.

was

no
results

same

The

by

processes and areas of manu¬

new

the

pleased

be

Miles Laboratories is

2-7815

devoted

world

working
in
the
This field shows

Takamine with enzymes for use in

one

at

investment.

discussed

Exchange

REctor

than

Getty

by the purchasers of the
be

to

Stock

BROADWAY, NEW YORK 5
TEL.

less

of

the

see

achieved
issue

in

would

I

Stock

York

American

to

the

in

impressed

his

for

understatement

an

that

end

Members

Allen

recommended

was

be

of the largest organi¬

one

industries.

double

to

would

McDonnell & To.

S.

shares

262 Vz

buyer

it

time

able

Merton

Thus,

the

com¬

potential for growth in
the chemical and pharmaceutical

giving

owner

This

American Stock Exchange

19 Rector St.,

unlimited

ef¬

was

is

pany

stock div¬

year,

Since 1917

adrenalin.

of

zations

a

This

company was formed in 1898 by
Dr. Jokiche Takamine,
the dis¬
coverer

exclusively
to
enzyme
field.

fected

New

as

the writer, is

by

Laboratory.

divi-

the

SCRIP

Takamine

stock

idend

&

the

Oil.
after
the
Getty
a
5%

later

Specialists in

visited

recently

chose

dend,

Principal Cities

I

article,
paid

one

RIGHTS

e

that

at

Shortly
writing

York 5

Teletype NY 1-40
CHICAGO

Private

"T h

Getty

Exchange

SAN

such

Members

industry. Two other anti-oxidants,
Luconox-9 and -4, are finding a
place in the manufacture of syn¬
thetic rubber products.
The newest division
of Miles,

Best"

Steiner, Rouse & Co.

wider distribution of stockholders

was

time

•

chemicals

fine

of

Corp.—Lawrence

Members New York Stock Exchange

them

and

•

ducer

Wheeler

other

many

isoascorbic acid and sodium isoas-

Security

BOSTON

and

corbate anti-oxidants for the food

Like

PHILADELPHIA

a

The Sumner Division! is the pro¬

and

headed

Corporation
120 Broadway, New

Louisiana Securities

S.

Investment Analyst,
Auchincloss,
Parker
&
Redpath, New York City. (Page 2)

column

New York Hanseatic

WOrth 4-2300

Merton

—

Vlaun,

famous

the

Stock

Nostyn,

of

this writer had the
privilege of having
an article appear in the ''Commer¬
cial & Financial Chronicle," under

all times.

S.

infective for variocose

Exchange

Last Aug. 23,

Associate

Laboratories

Foster

My-B-Den, an
veins and
superior form

mixture;

cough

a

active markets available at

American

Alabama &

Allen, of Harris, Upham & Co.,
New York City. (Page 2)

to

tory for asthma suffers; Diatussin,

ALLEN

York

New

Members

wide range of

a

S.

Harris, Upliani & Co., New York City

with complete facili¬

ties, make

Miles

be, nor
offer to sell the securities discussed.)

as an

Week's

Participants and

Their Selections

particular security.

a

intended

not

are

Thursday, August 1, 1957

Bought—Sold—Quoted

prob¬

Broad contacts, cou¬

lems.

they to be regarded,

are

knowledge

working

for favoring

reasons

(The articles contained in this forum

Trading Department has a
close

This
Forum

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

Try "HANSEATIC"
Our

Security I Like Best

Financial Chronicle.

closely held-

tApproximately 50:;

closely

held.

15x
.

4.1%

1902

16>:

3%
1900

heating equipment, marine steam
generating equipment, cooling
Continued

FOLDER

page

47

REQUEST

National Quotation Bureau
Incorporated

46 Front Street
on

ON

New

York4,N-Y.

Volume 186

Number 5660

The Commercial and Financial Chronicle

...

(475)

Credit and Interest Rates

INDEX

llCHTfllSTEIII

t. s.

In the Investment Boom
Bv

ROY

L.

Trust

Economist

Company, New

■/.*"

-

the ramifications

capacity industrial production.

on

skeptical

of

inflationary

in

prospects

our

halting

Credit

anachronic

we

times."

our

Challenging New Dimensions

thus, lead to further monetary inflationary
Repeatedly

the

past

two

credit and investment

mar-

have

large
lor

in

felt

the

demands

for

to

of

pressure

funds

freezing

bidding

il

ty■

upward,

the

the
have

markets

experienced

of

another

?,<.

particularly
strong borrowing wave,
and

nH

bond

as

have

tions is
0l,t

Roy L* Reierso«

well

market

securities have

uncertain-

place

not

been

since the start of the

tion

is

the

of

but

the

it

culties

is

the

well

but
of

are

differs

though

move

in line

Origin of the

advances

previous

industrial

Credit

production

Bank

has

of

come

to

for

may
years

and

It

Ult-f

Exchange PL, Salt Lake City
8-8786

Teletype:

SU

155

46

KMX.

»T

interest

rates

-

at

Insurance

Man's

Pacific Uranium

Stocks

27

Bookshelf

8

Investment Recommendations

From

8

7

^___

Washington Ahead of the News—Carlisle Bargeron____

Indications of
Mutual

Current

&

39

Mackie,

HA 2-0270

40 Exchange PI., N.Y.

13

About

Banks

and

inc.

*

____■

Notes

News

Singer, Bean

10

Business Activity

Funds

NSTA

McRae Oil & Gas

48

.-___

Einzig: "Britain Surrenders to Inflation".

.

,

Bankers

Teletype NY 1-1825 & 1-4844

27

Observations—A.
Our

on

Reporter's

Public

Wilfred

Utility

Governments.,

Report

i,

(

reflect?^growri

J

Registration.

The

31

40

:____

State

.

.

of

Washington

and

.

Trade

Corp.

Lisbon Uranium

38

You—By Wallace Streete

and

Altamil

43

Security I Like Best

The

A

Market

Chicago

29
!

Salesman's Corner

Security

Los Angeles

45

Prospective Security Offerings

suPb^y ,*°f -saviqgs to
these needs, however,% has

that. time;

13

.__

._

Securities..

Securities Now in

to

4

Railroad Securities

as

^

May...

Philadelphia

Reporter

Our

W ires

Direct

.

but ,he.cost o£ capital goods, such

Vi. 1U

unusually- low,

Giant Resources
.Cover

■

Tliiff should "not be

still

39

DAvis

(Editorial)

Dealer-Broker

building,
construction
and
has been declining, ereditImachinery—all large users of in-

were

46

Coming Events in the Investment Field..

financial requirements
been
enhanced
relentlessly
by
spiraling wages, costs and prices,

Squeeze

See

Business

Underlying the continuing rise
interest rates in the past three
yeais is. a sustained shortage of
new savings. The American- 0^°^*s c^ear^y m a full-fledged
investment boom. Moreover, not

en-

some

We

The
II.

United

by

Topic Concerning Most

on

JCY 1160

45

As

Capitol Requirements
,

perspective, it
liquidity in our

that

since'

Cited

HEnderson 4-8504

Teletype:

45

ro-

two post-

1956 and,

*

Viewed in broad

L VC1

36

Opportunities in Latin America

Announces Competition

Exchange PL, Jersey City

Baruch Oil

only have

economy

Spokane Stock Exchange

1

Regular Features

°' our economy.

diffi-

months

recent

troublesome

evident

J.F.Reilly&Co., Inc.
DIgby 4-4970

(Boxed)

Underwriting Costs Analyzed by SEC

avoid the conclusion that present

ahead.

is

Misconception

Important Economic Problems of Next 20 Years.,

financial history,

fairly level since the summer
indeed, has recently
backed away somewhat from its
year-end high. It is difficult to

concomitant

tionary trend subsides,
problems that itave
continue

♦

Dangerous

CED

been

of

reflec-

these

that

inevitable

in

United Western Minerals

16

!>

predica-^
investment

the

the

fore

14

_i_

Stability and Growth

States Inter-American Council

business upturns. Currently,
interest rates have firmed even

vironment. Thus, unless the inila-

the

12

19

war

re-

persistently inflationary

a

Northwest Productions

Inflation?

19

Investment

expected; through-

the

from

by no means transitory

an

of

Why Go Begging to Washington? (Boxed).___

corded in the

year.

another

by

appears

are

Aspects

Environment Affecting Insurance and Savings
Babson

A

—

over,

Other

Members Salt Lake City Stock Exch.

developments in the capital markets are not simply a reflection
huge financing require- of the business cycle; rather, they
ments
pressing upon an inade- seem to mirror problems which
quate volume of savings. More- are deeoly roofed in the structure
created

boom

and

Creeping Gold Devaluation to Prevent Creeping Price Inflation
Suggested by William Petty (Letter to Editor)
16

fundamental

ment

Money

Upon closer review, however, it
appears that the present rate rise

ceived, and the Treasury's cash
position has deteriorated rapidly
this

Our

Anxiety Over Inflation and Other Matters—Herbert Hoover._

conditions.

notch,

growing awareness of the Treasury's problems in managing the
debt.,fr Redemptions
of
savings
bonds have soared, Treasury refunding offerings of marketable

All

modern

our

be

Baruch-Kenilind Oil

with the broad sweep of business
another

Contributing to the
the

in

Minerals

12

coincided,

occurred

rates have tended to

yields,

in

to

General

3 States Natural Gas
___■

—John K. Langum__

interest rates to economic condi-

/

advanced

lies

rise

rate

Is

Prio« Tnfla^n

postwar periods of rapid
"/
business expansion: 1947-48, 1952-53, and 1955-57. This response of

short-term
as

has

9

^

Outlook and Prospective
Budget
Friends

Fiscal Action to Promote

three

many

rates,

the

.

"Who Speaks for the Public?"—James
K. Vardaman, Jr.

arti-

naturally enough, with a decade
and more of high and vigorous
capital investment activity; most

capital

Foreign Operations

Thorneycroft, M. P..._

—Roger W.

time

present

Honest

—Peter

levels

These

war.

WHitehall 4-6551

(;

Developments—Irwin

Moreover, the irregular but per¬
t 6*sistent advance in interest rates to

surged

Recently

The Short-Term

tionary potential,

rates

a v e

the

STREET, NEW YORK

11

How

these

at

"must".

10

'

pressures.

rates

finance

:

increase in the money supply and
the creation of a powerful infla-

supply, and
repeatedly interest

of

~

and,

iicially low levels had been maintabled only through a tremendous

limited

a

credit

reserve

WALL

Telephone:

Investment Management of Union Pension Funds
—Paul L. Howell

the Treasury to resort to bank credit and, in !

cause

«

Obsolete Securities Dept.
99

5

Recommended Tax Changes for Steady Economic Growth
•—John F. Costelloe.

no Treasury crisis nor long-term financing in the coming
months, and warns that additional demands for Federal spend¬

turn, induce expansion of member bank

for American

-f-Harvey Williams

higher interest

or

'

5

.

Other

Foresees

rates,

ing will

Cobleigh

*

r

3

_.

Tracing the Regulatory Pattern of the Federal Securities Laws
—Thomas G. Meeker

depression-day aims and policies instead of fitting

lifetime

a

the Investment Boom

are

rapid economic decline, tighter credit

no

in

Advantages in Contractual Investment Plans
—Norman F. Dacey.

price-

wage-cost

and

1

lust for cash, 99 Wall

you

is

Rates

The Bull Dog—Ira U.

Mr. Reierson is

pressures

"economic decisions to the realities of

kets

Interest

~

■

.

Cover

—Roy L. Reierson

having, deplores the mounting
which prevent market forces from
aligning investment demand with savings, and castigates our

years

and

r

If

.___

spiral

anti-tight credit

•

:

t

Tax

the

MUST FOR LIFE

("Chronicles"

operations during the

company

Second Quarter)

our

not based

.

Cover

■

analysis of investment

full-fledged investment boom and present interest rate
pattern which, unlike past two postwar business upturns, is

,;

Douglas MacArthur____

Funds' Portfolio Policies More
Aggressive

York

Page

AND COMFAHY

"The Fundamental Issue"—Gen.

Noted bank official and economist expiscates

of

Articles and News

REIERSON

Vice-President and
Bankers

3

16

San Juan Racing

2

Common

Industry

and .You

tJ-"

48

V. T.

&

4

•

t

C.

A

i

Universal Transistor*

only slowly and sluggishly,

V^See

Cover Page for "Chronicle's" analysis
operations in Second Quarter.

investment

of

.Quinta Corp.*
'-ft,

company

Published

Twice

Weekly

1

Diapers'

•

Gardens,

London,

E.

C.

"v>-x

;

'

'*'

-

1

.

Pacific Uranium

Eng¬

land, c/o Edwards & Smith.

The COMMERCIAL and

:

A

:

,

For many years we

;

-

rfft

vfe

25

7

-

.

-

-•

.

•

'7-

Nashville

Boston
•




•

Schenectady

•

•

Glens Falla

Worcester

Place, New

REctor 2-9570

York 7,

Dana
*

matter

Every

Subscription
Possessions,

in

Pan-American

state
1

States,

and

U.

and

Other

Bank

quotation

$40,000

bank

clearings,

news,

city news, etc.).
Offices:

3.

111.

135

South

La

Salle

St.,

and
per

Note—On
the

(Telephone STate 2-0613);

i

of

Union,

$60,000

per

in

year;

of

Other

issue—market

issue)

corporation

'

S.

Members

Canada,
$63,000
per
Countries, $67,000 per year.

(general news and ad¬
and every Monday (com¬

statistical

Chicago

Other

1957

Request

W* V. FRANKEL & CO.

Rates

United

Territories

Thursday

vertising
records,

,

1.

on

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

to 9576

Thursday, August

Prospectus

Febru¬

ary

Dominion

.

second-class

N. Y.

WILLIAM DANA SEIBERT, President

t:

»

Chicago

COMPANY, Publishers

as

Subscriptions

plete
•

DANA

HERBERT D. SEIBERT, Editor & Publisher

TELETYPE N. Y. 1-5

-

**

...»

Albany

Park

ST., NEW YORK 4, N. Y.

TELEPHONE HAnover 24300
..

-

B.

•

*

Members New York Stock Exchange

25 BROAD

■

Reentered

Company

Reg. U. 8. Patent Offico

WILLIAM

Spencer Trask <&_ Co*

Copyright 1957 by William B.

!

FINANCIAL CHRONICLE

i

r;-

rate, of

-

-

Record — Monthly,
iForeign postage extra.)

account

of

33

BROADWAY, NEW YORK 6

year
~

Publications

Quotation
year,

INCORPORATED

\

»

WHitehall

3-3960

Teletype NY 1-4040 & 4041
Direct

PHILADELPHIA

Wires

to

DENVER

the fluctuations in

exchange, remittances for for¬
eign subscriptions and advertisements must
he made in New York funds.

SALT

LAKE CITY

Financial Chronicle

The Commercial and

...

Thursday, August 1, 1957

(476)

4

and

stock

impossibility of gauging
of a signal's becoming
effective.
The
stock-bond
yield

.

.

.

(that

ratio

By A. WILFRED MAY

to that

Stocks related

trial

FRESHMAN AT

A

Women)

(For

is

It

MAY:

DEAR MR.

deep conviction

our

that a

good value, based on the realistic cline, as follows:
in the issue of
appraisal factors in each situation,
Stock vs. Bond Yields
is most interesting, and should be bought at any time; and
January 1952
2.
pointed (at me, I'm afraid). For
that the term "speculative" as so
June
19531.
the most part I am in agreement
with you, es- applied is extraneous. Your race
Average 1954____
1.
track issue might actually be less
Pp.#;
Average 1955
1.
pecially about
3
the cause for speculative than your ATT under
Average 1956____ ®1.
a given
price differential. In any
1957—
the rise in the
event, the dog of today may be
market.
January 1
1.
the
pale or deep Blue Chip of
But
I don't
February
1.
March
1.
feel that no tomorrow; or vice versa.

V

8%
8

distinctly

buy specula¬
tive
stocks.

attitude in your buying into
proprietorship of the Mon¬
Race
Track
(in contrast
to that of the "customers"). At the
same
time, I would caution you
not to overemphasize the volume
of business as a value factor, to

feel that one's

portfolio
May

ersif ied,

speculative.

of which can be

some

v

However, the ratio of speculative

put it, "safe"
ATT, etc., should joyed heavy volume.
Hats off to the diversification
proportion.
example, in my own case, your portfolio has achieved; rang¬
from fixed-interest govern¬
hold five shares of U. S. ing

stocks,

to,

in

now

Steel,

share of Celanese

chased

(and some Gov¬

shares

ten

A. W. M.

speculative
for doing so

My

are

daily

reasons

watched

have

the

newspaper

The amount

present at the track.

people and money bet far ex¬
ceed not only last year's record;
but also the attendance and intake

of

at

simultaneously

runs

that

has

feel

I

happened before.
soon as their state¬

as

released, the stock should

either go up or
a

with Mon¬
something

never

that

ment is

is

This

Park.

mouth

which

track,

York

New

the

I

the track will pay

bonus.

handsome
Have

made

,

foolish

a

choice?

Beaver

of

1959

pointing

out

correctly point out the
of

difficulties

just when the dan¬
market elements will be¬

knowing

gerous

distortion

of

the recent weakness

stitute

an

in Bonds con¬

that

indication

stock

will soon begin to drop?
And if so, will that result in peo¬
ple then buying more Bonds, caus¬
prices

In fact, the main

realistic

iheir

of

major recovery in the Bond

a

worrying

COUTURE

JOSEPHINE

39

Broadway,
York

The

"The"

Is

acute

decline

the

on

—

in

your

final

assuredly will
bond buying;

query:

a

appreciating stock sector.

than many

those of

line with

big industrial groups.

it adds, will defend their right to use part of their

The mills,

earnings to finance expansion by pointing out that from

ities, increasing steel making capacity by 46%.
of this

earnings, while long-term debt was increased by

The

balance of the $8,000,000,000 came from stock

"The Iron

generated through fast amortization.

cash

from

and

Age"

says

the Senate price probers will get a full
The steel companies will

steel's future need for cash.

on

point out that fast tax privileges are
allowances

tion

About $3,900,000,000

from

came

$800,000,000.
sales

1947 to

industry spent $8,000,000,000 op new or better facil¬

1956 the steel

running out, that deprecia¬

low to meet the

too

are

build

Lewis to Be Partner

bond

Ronello

expense

of maintaining

will

Lewis

B.

continues this

orders

become

partner of E. F. HutCompany, 61
Broadway,
York City, members of the

The

feet.
the

trend

overall
is

the

As

New

New

Stock

Ex¬

change, it
a n no u

1

stock

outlook

market

so

improves,

steel

users

are

taking a

Many steel customers are keeping

inventories.

caught

automotive business is to plug holes on inven¬

Some of the

market

principally.
pick

One large producer

capacity and possible full

quarter.

catches

demand

automotive

in sheets,

Steel

opiimistic.

quarter at 93 to 95% of

been slow also will

fire,

it

will

tighten the

But other items that to date have

up.

prices in Great Britain went up an

average of 7%

July

and

Comptroller of

29, according to

the metalworking weekly.

Continued

Mathie-

on

page

Ronello'B. Lewis

Chemical

Corporation,
prior to that for a four-year
served as Comptroller of
the Radio Corporation of America.

and

period

BANK STOCKS

Earlier
Butler

/

Send for comparison

of 12 largest Philadelphia Hanks

he

associated

was

Brothers

and

We.

is

writer

a

financial

and

Management,"

Montgomery
lecturer

MR.

on

At

has

Reports

just

.

,

,

,

.

.




SCR ANION

•

•

ALLEN TOWN

ATLANTIC CITY

•

LANCASTER

as

was

&

ton

a

been

late

B.

ABELOW
us,

t

Mr.

Mitchell & Compani)

Cutten

Allan

H.

Crary

Members

Philadelphia-Baltimore Stock Exchange

partner in E.

for

general

branch.

HERBERT

re¬

that Charles E. Crar>,

a

Co.

quarters

that

for

F. Hutyears, will also
be admitted to the firm on Aug. 1

PHILADELPHIA 9
PITTSBURGH

•

time,

same

the

of

who

NEW YORK

the

announced
son

INCORPORATED

to announce

lias become associated with

leased.

STROUD & COMPANY

pleased

subjects and his current

"Accounting

book,

are

with

Ward & Co.
He

in

on

This is nearly
double the percentage rise in American steel prices.
Producers
said the higher prices were needed to cover increased material

1953 Mi'. Lewis

has been Vice-

•'

In¬

far is not overwhelming, but

steel salesmen as a hedge against being

in close touch with

When

broker¬

son

though

Detroit has not as yet jumped in with both

capacity operations during fourth

E.

firm. Since

Olin

as

there.

looks for third

senior

President

it looks

This includes some automotive

The mills themselves are mere

nced

f f

o

paper,

tory shortage items.

was

yesterday by
u

up.

order picture

closer look at their

short.

York

trade

turned the corner for the better.

picking

are

&

ton

R

integrated mills.

business, although

general

a

new

Meanwhile,

coming

age

PHILADELPHIA

less

industries and

other

that the mills will show that their

pretty much in

are

years

the steel market has finally

A. W. M.

nation wide

Maintained in all

the

over

must

shrinking and discouraging
portfolios to the glamorously

bond

partner of the

Trading Markets

This trade weekly reports

earnings

from

Cutten,

Active

national metalworking weekly,

existing plants and that the industry is reaching a point where it

Of E. F. Kutton & Co.

the' overvaluation
But, the long course of
in the Blue Chip, or non-"spec- ability.
ulative" area; with such issues— the decline in the spread between

out fighting when they appear before

states "The Iron Age,"

years,

rundown

City

quality fixed interest obligations,
certainly constitutes a major in¬
dication of stock market vulner¬

come

reversing the investor's long shift

When?
in

will

the current week.

turning-

about

itself ' stimulate

by

stocks

factors

drop

stock

major

value

market.

the

today's market may

individual

appraising

point signals.
Answering

atmos¬

in

be

actually

apd equity securities, and then

est

to

is

the

still

off?

a way

affirmative

constructive

like

When

of

is

market

Is the prepon¬

over-valued?

lieu

Bonds

Steel people

again

was

indus¬

derant non-Blue Chip section

versus

and

the

of

area

effective. I would very

much
know
if the action of
any kind of signal. Does

year.
Construction activity in many areas
curtailed the past week by the cement workers strike

period last

that only

indicate

perhaps

special

a

annual

an

plenty of ammunition handy to defend their pricing policies over

meager

selected

50

the

on

come

market, with Governments and
phere of the bull market, I did not tax-exempts included in the dog¬
house;
along
with
high-grade
mean to convey the impression of
advocating the shunning of "spec¬ stocks yielding less than firstulative" stocks.

3.71%

fractionally in June tc

income moved up

of

6% or
run-of-

(of

so) still available on the
the-mill stocks, and the

article in the solution to these questions lies in
policy
concentrated
on
"Chronicle," Thursday, July 25, market
"How High Is Too High?" you very •diversifying between fixed-inter¬

College,

some

excesses

yields

mainly responsible for the
building and purchases of

congressional price probers beginning next week, and will have

Referring to your

Definitions
In

the

between

were

residential

disparity

sizable

the

does

The

New

speculative

1929

healthy and its reversal

"LADY IN

Germantown, Pa.
Valuation

Realistic

And

DEAR MR. MAY:

ing

JILL CURTIS

Class

time

any

below the

buying

declines in

$344,090,000,000 and was 5% higher than the June 1956
period. The Oftice of Business Economics pointed out that the
major part of the increase was brought about by wage and sal¬
ary disbursements.
Awards for highway construction, it is rioted,
also rose sharply the past week, touching the highest weekly vol¬
ume
on
record, according to "Engineering News Record."
This
offset declines in private construction, boosting the total dollar
volume of heavy construction awards 2% over that of the pre¬
ceding week. The cumulative total of construction contracts for
the first 30 weeks of 1957 was 16% less than the corresponding

stock market break?

now

FINANCE"

to the number of people

as

#

FROM ANOTHER

follows:

I

$

purely

a

stock.
as

ff

*

,

Track,

Race

at

1954, and particularly in late
when

trials.

traffic.

recently pur¬
of Monmouth

I

bonds).

ernment

(parenthetically included
by you) to equity in the ponies

ments

share of ATT, and one

one

1

the 1929 stock

1955

it fell

inventory

offset

Personal

after

as

lesser

a

For
I

you

as

stocks, such

ratio

mis

the Council of Economic Advisors, the gross
the second quarter of 1957 advanced to another
exceeded that of the preceding quarter by 1%.

to

and
in

and

rate

period.

Surety

week.

capital goods.

2

period,
could
have
neglect of earnings coming stock-craze
through, and of possible property been regarded as an important
and other asset valuation. Remem¬ danger signal.
So who can tell whether even
ber
that the railroad
passenger
carriers
and the meat packers, the present record below-parity
figure
presages
an
early
bad investments, have always en¬ latio

kinds of stocks,

d i

rise

1he

should be well

many

including

boom-crash

high

new

Increases

1%
2

0.94

:

the minimum of

1956

national product in

2

0.99

June

*Below

like

According

1.17
1.10

____

________

July

mouth

this
point in your
argument?. I

Wilfred

May

the

terpreted

A.

in

track

right

April

your

misin¬

I

Have

the

on

are

the

8
3

_

line with this credo, you

In

should

one

be

business and industry in the latest week ap¬
peared a bit brighter with steel, electric and automotive output
showing signs of improvement. Retail trade volume showed some
expansion with reports placing sales at 1% below to 3% above

11

__

Index

The picture for

column

Your

July

Production

Business Failures

J

drastic de¬

period of steady and

Industry

Price

Auto

and

Grade Industrial Bond In¬
as
in 1929—ignoring quantitative
dex) which, in 1950 after years of
criteria of value, being deemed to
stability, stood at a normal 2.8%,
be "safe at any price."
thereafter entered and extended

BEAVER COLLEGE

Trade

Food

High

FROM

Retail

Commodity Price Index

its

on

Output

Carloadings

Indus¬

50

Production

Electric

State of Trade

yield

average

Poor's

&

Standard

of

the

is,

Steel

The

time

the

7^

our

the

to

Observations

yields perfectly
conclusion
as

bond

substantiates

23

partner with

the Tucson,

head¬
Arizona,

120 BROADWAY
July 20,

1957

♦

,

NEW YORK CITY

34

Volume 186

Number 5660

The Commercial and Financial Chronicle

...

(477)

might not be amiss.

The Bull Dog

million

and

now

By IRA U. COBLEIGH

all

a

famous manufacturer of

heavy

Common

companies

have

changed their designs and lines so
drastically through the years, that
in many cases, it is difficult today
to

distinguish

19 5 7

by

models

k

m a

S t

t

u

Cat,

A

e.

Bear

z

1916

a

or

Packard

could,
in
its
day, be posi¬
tively
identi¬
fied

at

yards

by

10 0

but not

year's

lot

of

identity

drop

simulation.

board Dali-ism in

sign,

stands

automotive de¬

in

out,

clearly today

the

as

it diet yeaio

as

too,

truck

however,

—the Mack Bull Dog.

symbol,

this

drawing

of

emblem

one

field

all

of

e;

It's

because

ago

a

Macks,

good
the

truck, sales

There
main

engine

qualities of strength,
durability, dependability, and te¬
nacity, cnaracteristic of bull dogs.
And, with this plausible canine
we

description

of

makes

and

nowned

and

Mack

move

the

to

on

some

that

company

services

these

and

term

m

of

duty trucks, having pro¬
1956, 18,738 units. Tnese
included both gas and diesel moti¬
vation, and four and six wheel
in

drives.

In

self

share of the truck business (above

94%), heavy duty haulers, spe¬
cially and functionally designed
industries

certain

materials

building
mixed

have

concrete)

particular

province

pendents.

Moreover,

these

(such

and

as

ready
the

been

of

inde¬

the

in

of

many

industrial uses,, overloading

is chronic;
continue

and

truck that can't

a

to

perform effectively
toting far more than its

when

example, in the
balance

sheet

in

receivables.

time and
as
a

units in the business. Such

any

reputation
And

asset..
been

little down

as

low maintenance cost

as

is

sales

obvious

an

Macks

have

certainly

selling.

1956

soared $4%

million

the

over

preceding

current

high.

So

—

a

managing to

hold

another

we're

here

talking about

not

tired company just

its own—we're

talking about a company in, per¬
haps, the most dynamic phase of
its

history.

due

of this

Part

importantly to

ment

in

the

drive

of

person

is

Since

been

3955

only

more

sales,

(1954

S120

only has this
lon

sales

it

has

manufacturing

tions;

diversified

in

ing,
C.

and

D.

the

themselves.

leads

tors.

of

of

for

3

in

[Norman

tractual

part

in

now

aggressive
of

teau

share

profitability

in

1956.

All

the

stock

to

and

looks

you

$1.80

a

1949,
cash

the

—

of

major

a

stage

not

company

like

over-priced
earnings, and were
project the rise of sales
times

Brockway

Mo¬

So new whether the need

is

earnings at the current growth
rate, for the next two years, you

could

certainly become

a

bull

on

Mack.
To
of

sustain

that

look

at

or

eager

the

justify
sort,

optimism

however,

industry Mack

a

serves.

life

a

insurance

fund

the

„

part

as

and

shares

net

period,

ten-year

cost

the

a

the mutual
the liquidating

......

*

\iri_..

x

In

MIAMI, Fla.—Frank H. George
has been added to the staff of Sills

of and Company, Ingraham Building.

total

INVESTMENTS

a

Jim.

re-acquisi-

We offer to United States investors

complete facilities lor the pur¬
chase of high grade Canadian in¬

effect,
and

Our facilities include:

vestments,

A Research

Department with

up-to-date information on
major Canadian companies.

the acqui¬
continuing

A

Correspondence Depart¬

ment to

deal in securities

mail.

are

the

of

part

be

building

of

cost

"association"

to

and

by

the

considered

<

substantial

a

Private

portion of these charges is deduct¬

offices

wire service

across

to

our

Canada.

ible from the income of the "asso¬

ciation," thus making part of that
income

tages

tax-free.

are

These

advan¬

Inquiries from investors

pretty generally

known
There
is
h
tax advantage,

and

appreciated.
unique additional

however,

which

is

not

are

Most

of

the

contractual

plans
provision
under which the plan is automati¬
cally. completed in the event oi'

include

the

a

life insurance

investor

the ten-year accumulation

period.

-

■

CJF1
J.

SS

n

McLeod,Youhg,Weir

E

itw—

&

This
a

of

the

is

accomplished by carrying
low-cost, deducing-term .group

creditors

unpaid

policy which covers the
balance. Each month, the

custodian

bank

insures

the

inves¬

tor

for

his

account, deducting the cost of

just

enough

to

complete

»

i

'

CoMPAHY
LIMITED

Investment Dealers Since 1921

during

death

invited.

generally

realized.

1

r>

«

CANADIAN

have

program,

beneficiary to receive
death, thus avoiding

charges

amount

in

or

They provide for the

a

the dif¬

of the insurance in computing his
taxable gains,

pre-

$23,800
the
first
month,
$200 the last month. Over

growing
public
periodic invest¬
scheduled basis. They

at

provision,

value. He cannot deduct the cost

such,

as

invested

actually

in

tne

between

ference

...

ticipants

car¬

seeni

with

are

maintenance fees paid by the par¬

high of:
for what
basis.

this

for

association.

vigor,
new pla¬
$4.75 per

dividend

tax advantage
so-called volun¬
tary plans in which the "secu¬
rity" being purchased is not the
"plan" *. itself but the underlying
mutual fund shares. In computing
his - long-term
capital gains tax
liability under a voluntary plan

down to

this

a

plan

sition

and

to

so-

con-

delay, expense and publicity
probating. Tax-wise, they gen¬
erally elect to be taxed as an

spotty

which

plan.
Curiously,

insurance

regarded

deduct

does not apply to

,

the

1957

a

enabled to

premiums from his
capital
gain
on
the

long-term

However,

of

new
a

is

investor

gross

a

naming of

wide

current appraisal, the

on a

seven

the

set

like

Now,

and

amazing

sales, and

of

the

of

tion charge.

considera¬

and

acquisition

inal fee and without

dividends,
Mack
with a hard-hitting

and

emerges

management,

opera¬

sales,

the

number of advantages
generally offered by the vol¬
untary plans. Most permit with¬
drawals and re-deposits at a nom¬

common

with

years

the

not

appeal to the income-

of

on

present

this

does

acquir¬

the

year

ment

split in 1948, 5%
10% in 1955 and

and

are

invest¬

the insurance

plans, which differ from

of

first

Mack

in

the

contractual

the

"sales load" is concentrated in the

com¬

and

of

plan, with its separate regis¬
tration as a security in and of it¬

the vountary plans in that a large

war¬

and

Thus Mack

nature

expense

not considered

instead

but
of

ir0m

The

stock.

both

are

of

a

grams.

Dacey

r.

called

equity must be based
speculative viewpoint. After

a

which

plan,

be-

investment in the With J. A. White Company
plan. To illustrate: On one such
CINCINNATI, Ohio—Andrew C.
steady
climb plan begun ten years ago, and into
o'Lcary is now with J. A. White
in the number which
payments of $200 monthly & Co Union Central Building./
of
such
have been made, the investor has "
%_
planned in- enjoyed life insurance protection
C;ilc A ride
vestment pro- 0n
his unpaid
balance, ranging
oms ^aas LU

Wt

the
and

have
been,
few stock divi¬

a

investor,

earnings

at

is

1946

in 1954,

number

monthly

"

difference

investment

gross

ment

.

There

1956.

tion of

miums

^

the

on

Thus,

premiums

purposes.
r

of $23,-

(adjusted for dividends)
liquidating value.
because
of
the
peculiar

of the contractual invest"

is

his

the investor must pay on

deductible

legally

ment

re¬

reveal

which

of

irregular

however, quite

minded

(ex

All

cyclical,

been

makes little

case

_

all

figures

performer.

losses

in

tax

the

mutual
'
1

port

from

common

business

showed

in stock

for

by

a

funds

historically

distributions.

5%

not

plans

untary

car¬

erratic

and

has

vol-

the

most

spe¬

common

an

petitive
and

his net investment

the $38,000

and

Premiums

insurance,

he doesn't
the difference be¬

(adjusted for dividends)
and. the $38,000 liquidating value.

Tax Deductible Life Insurance

Life

other $857.40
premiums

But

142.60

current

the insurance from his
monthly investment,

In¬

offered

the Ameri¬

on

5A/ks

to the

Now Mack

Mack

1956,




4

85.

at

up

stock

Company, manufac¬
inter-city buses; and the

division

a

detached

The

sell
us

a

tween

the

of

Exchange

and

.

rants)

on

plan.

vestment Plan

Wtw&frj1

Exchange at $13 and shared
in
interesting
speculation
in enthusiasm

are

Not

Beck

turers of

truck

Autumn

by

Stock

issued

however,

sell

now

eche¬

streamlined

integrated

phenomenon

The

pop-

investment

Monthly

Stock

can

had

million).

accade.

periodic

now

Warrants

32%

new executive

astonishing growth in

ularity
of
plans is a

1, 1959; and at rising prices there¬
the bonds

tax

\

;

The

was

the

insurance

pay

investment

gross

tax

whatever divi¬
paid

tne

shares;

paid.

deductible in contractual

part of the

as

a

the years.

over

he

\

regarded

for

between

self, separate and apart from the
underlying mutual fund shares,

J '

in the

might be
this loan

were

are

liable

reported and

which

advantages found in contractual investment

plans since they

permits for the
purchase of 1 V:j shares of common
at the same price ($40) until Sept.

O.

than doubled the annual

but

they

then,
split

was

each warrant

ried

Peter

It

of

.'

that life insurance premiums are tax

1957
$240

August, each $1,000 bond

after.

on

fund

plans, not generally offered in voluntary plans, are discussed
by Connecticut financial consultant. Points out, for example,

ried warrants for the purchase of
10 shares of common at $40 per

manage¬

new

Peterson, who became President in

February

part

When

variations

million

of

These debentures deserve

cial note.
last

on

*

other

and

would, in due course, be converted
into long-term debt, which at the
moment consists only of $19,109,000 of 5j/2% debentures due iyt>8.

1957
new

assets

liabilities.

that

a

$68

Tax

March 31, 1957) a revolving bank
credit
of $95,385,000,
Wi.ieh was
the main item in toe $160 million

year to a whacking $12
million. The first quarter sales for
were

31,

$78 milliori

dends—a 2-for-l

For 1956, Mack sales were $254
million, the best year in company
history and $60 million over 1955.
Not only thai, out net earnings for

the

To finance, in
part,
there
was
(also
at

latter,

had

constituted

DACEY

F.

tax each

Actually, he invested only $23,142.60 in the underlying mutual

Advantages in

By NORMAN

inventory and $149 million in

the

he

tax

a

Norman F. Dacey and Associates, Connecticut

of Mack the

March

which

truck

loading stint, with

Y.

wheels (or

on

case

of

current

of

The

over¬

N.

matter, off!) is prepon¬
derantly a credit operation. For

Well,

this

about

of

manu¬

always built it¬

that

been

take

yield

6Vz%; you can make a calcinated
risk speculation in
the common

Contractual Investment Plans

days,

has

can

has

like everything else
for

rated load, just doesn't get bought;

Macks

current

a

dends

$24,000

Tax and Othex

division

(and not just assembled)

common

for

electronic

vital components of its trucks.
The sale of trucks these

share.

them, the lion's

among

with

85

intercity

now

from the plan, less

tween

employees, a
Allentown, Pa.;
laboratory, ware¬

-

three

do.

se¬

which

on

a

he
deposited
and
the
he is now withdrawing

The 'tax

an

and

point of size,
they
way from eight, to
sixty-eight, tons in gross vehicle
weight. Wnile tne automotive big

ranged all the

of

curity buyers. You can buy the
51,2 % debentures (ex warrants) at

the

at
Cortland,
highly integrated

a

expected

anufacturer

down

cut

sorts

all

is

difference

$24,000
$38,000

and

lease)

of

heavy
duced

not

Parts

are

division

re¬

Trucks, Inc. is the largest

i ndependent

financial fare for

de¬

at

*

respected Macks.

will

event Mack today offers

He

the

at

plant,

house

showed

strated those

specially

In any

riod.
on

paid

during the accumulation pe¬

year

is

dividends

of

investor had

11,500

are

plant

million

reference,

efficient units,

which

story, however.

Tiffany among heavy duty trucks,
road-demon¬

distribu¬
well equipped for
enlarged merchandising.
Mack

running time and eliminate delays
due to traffic jams and (3)
the at 30 (a 5.6% yield if the 45c
are
important, too, and in moving of a myriad businesses to quarterly dividend is maintained);
the
suburb.*, removing the lags or you can just plain speculate in
1956,
accounted
for
16 % %
of
due to downtown city congestion. the warrants at 13. This is an in¬
gross; and this highly profitable
So whether we look at the con¬ teresting situation. Ycu may either
section of operation is
constantly
struction and roal building indus¬ be attracted to it; or perhaps de¬
growing as more units are placed
try itself, or the outlook for trucks cide to have no truck with it.
on
the read.
New

whole

have

consistently

vestment
the

service

tear, facturer

and

Out

welter

r

u

Mack,

as

tors,

more

them.

Mack is

streamlining,

progressive

liver

protection.
If the plan
liquidated now, its value
be about $38,000. Part of
this increase represents the rein¬
were

would

domestic and 55 foreign,

for

trucks, too, a
been lost by

has

manu-

t

c

a

gross

such

surance

"through 56 sales and service of¬
fices in
U.
S. and
Canada, 280

highway mer¬ signed equipment such as refrige¬
chandise transport, or the latest ration trailers; and LPG tankers;
style intercity bus, Mack can de¬ (2) the super highway program
trucks

gram;

Equally among

Cobleigh

studious

this

trucking
over $6 bil¬

on

producer

ity

carrier

now

$857.40 has been deducted for in¬

improved highways
the long run in¬
17% of dustry
projection
is
definitely
They do favorble—and favorable to a qual¬

annually (against $9 billion
railroads.) This percentage
by trucks is defi¬
nitely on the increase due to (1)

Plainfield, N. J.; the Beck bus
at Sidney, Ohio, and the
Brockway plant (under a long-

f
U.

the

so

of

cars

Ira

boy;

thruways,

of business done

for giant trucks to haul
aggregates
for the Federal
roadbuilding pro¬

any

school

buses

for the

and its prospects.
automobiles

and

and

lion

duty trucks, Mack Trucks, Inc.; is offered in light of its past

Passenger

venicies.

10

right

are

road

represent

registered

ness.

of

they

There

the

On

19% of the intercity freight busi¬

Enterprise Economist
A current consideration

trucks

5

50 KING STREET
Montreal

Vancouver

Quebec

WEST, TORONTO, CANADA

Ottawa

Winnipeg

London

Hamilton

Calgary

Kitchener

Sherbrooke

Windsor

Edmonton

New York

GOVERNMENT,
AND

MUNICIPAL

CORPORATION

SECURITIES

,

6

The

(478)

the

along

line.2

endeavored

tage

Tracing the Regulatory Pattern

criminals

Some

have

of

take

to

tomed to think of
office

ad van-

requirements

these

Commercial and

as

servicing

to

legitimate

the

Exchange Commission,

the highlights of the six acts administered

day

have generally

they

successful.

swindler

A

sion is

But there are the
operate in a
that is nothing less than fan-

for

fraudulent securities sales is

disclosure

of

transfer

tion; regulating

security; improper

a

tion
we

the

deposited

collection.

for

bank

Not Supplant
State Law

through

securities

securities

Federal

of

but

it

amine the sit—

sion

uation

that

it

existed at that

until the

not

was

depres¬

to

came

head.

a

A

Congressional committee reported
during the decade after the
first World War some $50 billion
that

time.

Perhaps the
most

import-

of new

ant

obstacle

this country and

securities

«

public

intended

are

unless the prospect show particu-

to

reinforce the ef- lar promise. The representations
to protect the made over these phones are afinterest.3
Indeed, one of most, unbelievable. The pitchmen
and

the

states

the purposes

G.

Meeker

conducted

from

which

was

criminal
from

solution.

no

violated

If

state's

a

ally

a

a

that

laws

not

problem

somewhat
In

disclosure
eral

law,

issuer

a

new

of

that

stitution.

avoid

the

on

of

foreign banks and trusts to brok¬
and

ers

dealers

for resale

All

the

interstate

tion under

of

the

make

it

*An address
own

of

views
or

Texas

July 3,

the

the

panies

operating
from

calls or they are fired. The. resuits are staggering. One boiler

utility, com" control

absentee

The

securities

state

you

not

—

sales -of $2 million. The long distance telephone bill for the ,.same

between the
commis-

cooperation

several

mind

—commissions

regulatory authority over them.

not

those

of

the

any

Fort

Worth,

and

T

i

I

that

the

or

This

so

interstate

4

like

4,

4

to

vigorous

a

en-

,

civil

public

at the lustoi ic

who

&uilhbility of those

private.

or

Of course, the

Brooklyn bridge.

'at
at

citizens
ti acted

tWs
this

But

the huge

moment

are

lepresentations

on

ly fantastic.

Hardly
office of

at

ex>
e

equa

a yeai

do not have

our

if

they

every

step in

present

are

passes

least

one

who

someone

nch tells him with certainty the

where

spot

oil

be

can

simDlv

a

scheme

Sess.

Report No. 85, 73rd Cong.

1933,

p.

2.

1st

In

Texas

a

extracted

had

chine.

large

This

perpetual motion

a

He

known

also

had

machine which was a
for about every disease
man
including cancer.

remarkable

to be

machine

small kitchen

a

Mazda

a

old

cabinet

„

boiler

Most

of

us

.

,

_

,

which

rooms

probably

are

.

change Act
dependent

DISTRIBUTORS

facilities

of

of

of

the

which

are

use

again,
accus-

re„s

3 See

commission

not

of

themselves

the

mails

or

but they
the status

by virtue of
regulated, e.g. a member
exchange the regulation of

on

ouch

Securities

Act

Honolulu Stock Exchange
ond other

Private leased
SAN FRANCISCO

SEATTLE

•
•

LOS ANGELES
PORTLAND




•

•

American Stock Exchange

•
•

radiotelegraph circuit
NEW YORK

HONOLULU

•

•

to Honolulu

CHICAGO

AND OTHER

•

BOSTON

an

and

prospectus'de-

a

by fraud or
misleading statements or hall'-

uoiths.

I

the word "sale"

use

shorthand term.
j

d

d

,t

326(2);

PHILADELPHIA

PACIFIC COAST CITIES

issued

of¬

by Federal, state, 01* mu¬
governments or banking

nicipal

institutions, and

securities issued

certain
non-profit
corpora¬
tions, savings and loan " associa¬
tions, and cooperatives.
Another

by

ticularly
tioned

be par¬
the in-

man

you

in

interested

is

exemption.10

As I

men¬

felt that

little while ago, Congress
the state should exercise

its

regulation where

a

own

possible for it to do

it

was

Accord¬

so.

ingly, exempted from registration
is

security which is part of

any

issue sold only to persons resi¬
in a single state where the

an

dent

issuer is incorporated in that state
and

does

in

should

make

should
this

it

clear,

exemption,
risks

all,

the

that

all

that

involved.

issuer

must

the

of

take

however,
rely upon
there are

client wish to

a

certain

to

substantial part of its
that state.
I think I

a

business

Association

First

of

certain

be

purchasers intend

securities

the

istrators
5

(C.

Estep
A.

5,

one

or

for

invest¬

short

Securities

resell

period,

thjnk

r

„

if

securitles

does

ln

commission
or

not,

"qual-

sens«that

the

_

in

any

underwriter

an

of the

within

Act

the

the ex¬

and

exemption is available only if all

the

merits of any security. The statute
has been termed a "truth in securities" act.

Its basic philosophy is

that

sell any securpublic if he tells the

anyone

ity

may

to the
truth,, the
whole
truth,
and
nothing but the truth.
*
This is accomplished by means
Gf a registration statement filed
with

the

Commission

which

sets

forth the information which Con-

has determined is

exercise an

deciding

necessary

f°

informed judgment in

whether

to

purchase

a

particular security. Once that registration statement has become ef-

One

it

is

the

investor

who

the ultimate decision.

As

Writer has expressed it, "Coil-

did not take

gress

away

-4-

from the
+

citizen

his

make

fool if himself. It simply

a

the

issue

inalienable

right

in a sense, merely those
"policeman On the beat."

_

to

of

all

and

of the sales, even those to

complement

o£

remedies.

If

registration statement appears

could

be

serious

oi

import.

non-resident

sale

to

the

even

be

inadvertent, and

it

should

warrant

not

7 Loss,

Securities

might
if

even

criminal

action, should the stock decline
in value, all who participated in
the sale would be subject to civil

If

client's contemplated offer¬

a

is

ing

to

under

be

take

to

in

$300,000

be well advised

amount he would

advantage

of

special

a

exemption Congress provided pri¬
marily

as

ness.1'

1

aid

an

to

busi¬

small

add

that this

exemption, unlike the
have mentioned, is not

others I
an auto¬
operative

matic

hasten

becomes

It

one.

to

only after certain information, in¬
cluding a notification and offer¬
ing circular,
is filed with the
Commission

formance

and

imposed
bv
Regulation.12
I

is

malefactors

to

of the

we

which
to

act

the

good,

common

may

be

restrictive
we

8 Sections

and

the
in

on

dis¬

allow
detri¬
01*,

on

hand, if we find that a

regulation
business,

If

statutes.

or

loopholes

cover

ment

constantly

discover imperfections

rules

our

Commission's

the

Commission
to

per¬

conditions

mention here that the

should

alert

the

upon

certain

of

do

unfair or un¬
to
legitimate
hesitate to

not

11

and

12,

on

15

page

U. S.

30

C. 77k

771.

9 Sections

3

and 4,

15 U. S. C. 77c

and

77d.
10 Sections

82.

This
The

residents, become unlawful.

Continued

To enforce the requirements ol
Act, Congress has decreed a

a

intra-state.

sold

„

the

full

is

any part is sold to a non-resi¬
dent the entire exemption is lost

way

upon

passed

3(a) (11),

15

U. S. C. 77c

(a) (11).

6 15 U. S. C. 77.
19

purchasers

non-residept,
might be consid¬
a

Indeed.it is. a liability at the suit of all of the
represent that investors. >

has

Admin-

discuss mutual problems.
v. United States, 223 F. 2d
1955).

the

to

purchaser

duly

to

a

of

more

should

the

within

If,

mission's duties under this statute

Investment

of

ment.

Section

1933,

withl^imX^ommitTee^ !h "n,!

tional

a

The prohibitions

offer

Commission

jbc

are,

302,

as

is important to emphasize that

the

year
•

and

and

ferings which do not involve an
issuer, an underwriter, a broker,
a
dealer, or a person in control,
are exempt.
Certain types of securities are exempt such as those

the other

Company
Act of 1940, Sections 1, so, 40(c).

leading commodity, exchanges

Sales

attempted to prevent Others fl'Om
making a fool of him ..7 The Com-

1934, Sec2, 28(a);
Public Utility Holding
Company Act of 1935, Sections 1, 18(b),
19;
Trust indenture Act of 1939, Sections

Chicago Board of Trade

exempt.

are

fac

jurisdictional
oi

sc_

"vered; 0f securities
(2) It makes unlawful

tions

J -.^J

sales

emption will be destroyed. Sec¬
ondly, it should be noted that the

Securities Act"

tbc saje

18; Securities Exchange Act of

Pacific Coast Stock Exchange

•

offerings

If

unless

fective,

.

ScCO.
-Membert-

require¬

Private

of

commerce,

play

person

securities

a

1934)
the

on

of interstate

into

came

Dean Witter

exemptions

registration

ments. 9

effective regis-

curbjes

8,29?cTCanPdror4<'b0rof<etKe; S5^TSE\n»kes

PRIVATE LEASED V/IRE SYSTEM

Exchange

in

H prohibits the sale of

in °''dcr to Pe.rmit
..

,

I mentioned are in evidence

DEALERS

a regulatory
if W nurblv

disclosure an<T anti-

a

"Truth

(1)

gress

Room

..

The

turned

lamp.5

sun

Describes Boiler

INVESTMENT SERVICE

ma-

atomic

an

to

containing

BROKERS

to

which he claimed had

company

out

went

from the public for stock in

sums

panacea

UNDERWRITERS

these

from

ered

approved
swindler

a

who

healing

Complete

certain

are

definition

,he

atomic energy.

perfected
1 House

Texas,

Midwest Stock Exchange

•

S,.1® doodlebugs range t/rm is often used
i'
l'i ® hck
complicated
machines allegedlyto powered by - criminal offense to

not be

somewhere

Exemptions
There

"

-

represents that he has doodlebug

prison

present in

Com¬

need

them

in violation of the Act.8

were

trabon statement is filed with the

sold gold bricks or

were

com¬

criminal, whether it is

or

jurisdictional factors

1957.

New York Stock

not really

is

..

.

.

important today than it ever has
been, and I urge support of such a
program
We chuckle sometimes

instru¬

whether the action

statute

combat^

to

program

4

n

the fact,

stress

for

need

forcement

w

means

,

fraudulent securities sales is more;

we

of

t.

i

would

in

the

was-$200,000.

recov¬

if sales to

damages

,

case

of the

Penod

most rely to a, great extent on
the efforts ol state authorities.
information when it appeared that ' ^uFmn?, n(^
*°
®Peci^lc
a
particular matter extended be- statutes, the first, as I smd, was
yond their geographical reach.
the Securities Act of 1933. The

that

use

has,

Similarly state officials have supplied us with their

ac¬

some

Commission

our

enforcement.4

statutes, it is first

staff, before the State Bar

Institute,

sions

.

is

by Mr. Meeker, expressing
and

of

or

merce.

diffi¬

detect
those responsible for violations of
the law.

mission

Accord¬

of

ery

free

which had prevented state author-,room we closed, down had, in a
itics
from
exercising
effective few months, grossed commissions

the

vestors to bring suit for

tra-state

precise

cult for the Commission to

his

jurisdiction
facilities

find

mentalities

controlling
more

se¬

the

and

our

mails

anonymous,
numbered
ac¬
counts of these institutions shield

and

Federal

ingly, before considering

to the

The

identities

source

commerce.

mails

necessary to

the

the

of

Congressional

the

public in boiler rooms, a type of
activity I will discuss a bit later.

persons

its

authority in the Federal Con¬

over

large
through

securities

is

curities laws, therefore, are based

transferred

its

Government

must find

and

powers

requirements of Fed¬
in control of an

of

Federal

the

persons

have

blocks

to

the

a

to

akin

order

of

sovereign in the sense that
Texas is a sovereign. The United
States is a government of limited

state, he was not technic¬
fugitive and could carry on

situation.

mention

all

to

common

are

to

jurisdiction. The lawyer
whose practice is confined largely
to local matters is likely to forget

of that

his swindle with impunity.
We are now faced with

be

;

Federal

distance and remained out

a

to

statutes. The first is the matter of

a

neighboring state by mail and
long-distance telephone. Even ex¬
tradition

like

should

I

found

were

two aspects of the sub¬

are

ject

selling

m
•

them

of

there

tect its citizens
fro

campaigns

half

state to pro¬

a

Thomas

effective

o

There

action.

criminal

warrant

exemption that

Although
securities reg¬
worthless.1 This situation brought been particularly gratifying. ThereV these outfits do not offer; stock in
several
instances
in non-existent, companies,
of
ulation by a about the Federal Securities Act have been
which we have made available to the securities peddled in the boilstate was the of 1933.
state authorities information we er rooms is virtually worthless
bdu mlary of
Extent of Federal Jurisdiction
had developed when it appeared
that, state.
It
We are doing all we can to eradwas
Before discussing the acts and that the matter was of a local na- 1C£de
.these criminal activities,
virtually
ture primarily a matter for state but we
their
cannot do it alone.^ We
provisions
individually,
impossible for
t

provisions, and it can refer to the
General matters which

Attorney

of the Public Utility work on a production basis. They
Holding Company Act of 1935, of must make a certain quota of
which I will discuss later, was to sales proportionate to their phone

floated in

were

that by 1933 fully

of

the

of.

power

statutes

forts

following the debacle of 1929
matters

that

strengthen

had been advanced for many years

by the Federal Government?,
must go back to 1933 to ex¬

is

ulatory
The

regulation

threeminute
egg-timer.
The
clatter
and din of these pitchmen, frea

point I want to emour statutes are
intended eo supplant the reg-

not

Various proposals for some type

question: "Why
necessity for regula¬

prospective victims, and

of

quently stripped to
the waist,
makes the term "boiler room" an
apt description. The egg-timer is
states., used to limit the telephone calls

The second

phasize

of inside informa¬

use

of telephones, a list

number

action under our statutes,

Supplement

procedures, trust indentures, investment
and public utility corporate
financial reorganization.

as

in
victim's

bank

the

'

proxy

In answer to the

is there any

he

in any

adviser and investment companies;
and

and carnival and circus barkers,
Each one has, in his cubicle, a

that

ever,

numbered accounts of foreign banks and trusts;

what constitutes

How-

be that as it may, some jurisclictional basis must be present

state, and then learn

a

dismay

more

by

requirements

anonymous,

who

large enough to hold one person,
Frequently 25 or 30 salesmen are
working at the same time. These
salesmen are often recruited from
ex-convists, veteran fraud artists,

his

tim's

important today than it ever
Some of the items discussed are: avoidance of

been."

outfits

can

tastic.

check mailed the check to the vie-

combat

to

program

way

nearby town in the neighborstate.
Or he may carefully

a

which

economic

prosperous

enforcement

vigorous

a

of such firms.

to

cited by the SEC's top lawyer who contends that

need

has

present

our

vast majority

of the

true

fringe

confines of

Legal and practical problems which arise from day to

are

"the

about

it from becoming
ask the Court to

enjoin sales of securities in viola¬
tion of the registration or fraud

but

been

It

The typical boiler room is are also provisions which, in my
ing
located in some shabby office judgment, result in an effective
deterrent to violations of the Act,
stay away from the mail box and building and consists of rows of
the" telephone, remain within the- small cubicles, each one just about namely, those which enable in¬

vigorous law enforcement, and credits this, in turn, for sig¬
health.

prevent

I hasten to add that this impres-

not

to

by the SEC, Mr. Meeker attributes a great deal of the peoples'
restored confidence in the capital market to their faith in

nificantly bringing

to

der

statutes

studiously avoid mailing letonly to find that he has overlooked a certain automobile trip

Washington, I). C.

After summarizing

Commission

effective.

ters

Securities and

invest-

incomplete or inaccurate the
can issue a stop or¬

to be

ment needs of their clientele, and

may

By TIIOMAS G. MEEKER*

Counsel,

stock broker's

evade the sanctions of the Federal

Of the Federal Securities Laws
General

a

reputable organization

a

1, 1957

August

Chronicle... Thursday,

Financial

Regulations, 1957,

p.

3(b), 15 U. S. C. 77c (b).
Regulation A, 17 CFR 230.215.

11 Section
12

>

Volume 186

Number 5660

The Commercial and

...

Financial Chronicle

(479)

in

Britain Surrenders to Inflation

for

By PAUL E1NZIG

deterioration

a

of

payments.
this

most

is

of

The

the

balance

main

reason
because in

probably

other countries

there is also

degree of inflation, so tnat
British prices have remained reasonably competitive. There is, of
some

Dr.
in

Einzig

sees

hope for

no

England and ponders

Macmillan,

a

effective anti-inflation action

any

the failure of Prime Minister

over

progressive economist, to stand

fuU*rSu- no

inflationary

to

up

Explains governmental inaction in terms of:
(1) temporary freedom from balance of payments difficulties;
(2) public's acceptance of Roy Harrod's theory that the price

pressures.

situation will correct itself

expanded
political

industrial

Times

by

the

Prime

Minister

and

the

at least

Chancellor of the Exchequer dur-

ing the

of

course

the

debate

in

t-e

mm
1

long
thing!"

of

House

Commons

July

he

lingering
that

been

mistic

regarded
world

check

the

would

least

as

has

at

Why

rise

such

widely

through

is

nation

is

the

the

of

or

inflation

forced

de-

sure

of

doubt

that

these

unable to stem the
tide,

are

all

suggestions

forward

additional

by

friend

squeeze"

will

the

Government

to

simple.
war

has

de-

surrender

making it

to

The exola-

Ever

since

the

Chancellor 0f

no

whether

Socialist

unless
take

and

action

balance
And

until

of

he

was

under pres-

dif-

payments

unfortunately from

infla-

Britain's

a

full utili-

expanded

in-

of

that

if

about

worry

high

and

rising

the

in-

undoubtedly knows to be the only

the

output entails the
payment of the increased total of

possible

wages, the fact that the additional

into

get

wages

circulation

burn

long

additional

an

foodstuffs
rise.

pressure

their

Increased

raw

prices

to

after

the

for

them

Tamlyn Heads Div.

.

r

r^le

v.

is

be

and

The appointment of George S.
Tamlyn, Jr., as manager of the
public utilities division of Nation_

ten-

a

du(?

tQ

the

reaiization
of

means

dent.
The corporation sponsors
and manages the National Securi-

menace

that

ties Series of mutual funds.

the

Mr. Tamlyn previously was on
the staff of the Investment Department of the Equitable Life
Assurance Society of the United
States As a security analyst, he
specialized m public utility and

checking

the flood of wages demands would
be

through

creating

certain

a

atnount of unemployment. If either
Mr. Peter Thorneycroft (Chancellor of the Exchequer) or Mr. Mac-

millan had said: "If full employment is abused by organized labor

municipal securities,

???£*•
1 would
thf case for holding the community to ranlf„ tbe urease weref due }° the som, the Government may be

With Marache

.

to

an

increased

utilization

of

this

would

have

been

Dofflemvre

lvla/acne, L>omemyre

c'd9Pt10n °f

more efficient pro- reluctantly compelled to abandon
Auction methods. But if it is due its policy of full employment." But

_

Corporation, 120 Broadway,' New York
City,
has
been
announced
by
Henry J. Simonson, Jr., Presi-

Finally, the Government's decision to abstain from governing
is

_.

al Securities & Research

the Government.

entirely only effective

*a*se*
^r- Gaitskell rightly
Pointed out in the course of the
debate °n inflation, the Government is fundamentally wrong in
assuming that in existing circumstauccs an increase in output
vvauld produce a disinflationary

For Nat'I Sees. Res.

dency towards an increase in the
price level instead of towards a
decline as assumed by Mr. Harrod

in face of the inflationary

„

arSument

through the

will

(Special to the financial Chronicle)
LOS

,

ANGELES,-Calif.—Frecle-

with Marache, Dofflemyre & Co.,

accentuation of
not

has

so

far

<.

the

than disinflationary.

resulted

What

Mr.

Gaitskell

ment
omitted

to

up

in

a

position to muster

in existing conditions. Possibly

i

•

was

634 South Spring Street, members

of

the

Pacific

Coast

change.

,

-

'

any

effective.

it-

This

is not

announcement

There will be, of
course, tne usual
annual scrutiny of public

ail

offer of securities for sale

The

expen¬

or a

solicitation of

an

offer

to

buy securities.

offering is made only by the Prospectus.

diture,

but in spite of the pros¬
pects of cuts in defense costs, the
Chancellor

.promise
grand

is

total

Even

not

its

at

capital

tionalized

prepared

than

more

expenditure

industries

the

r.a-

cut

this

time.

All

$50,000,000

:

tne

Government itself is not going to
be

•

level.

by
by

and

NEW ISSI K

to

keeping
present

that

will

be done is to coordinate tne exist¬

Associates Investment

ing investment programs so that
they should not reach their peak
at-the
The

setting up of an independ¬
advisory council is the only

innovation
leaders

envisaged.

of

the

of

the

labor

of the

been

the

have

committee

announced,

tion appears to
mature.

But

if

Offering price 100% and accrued interest

could

not

condemna¬
to

views

the

on

reach

never

decision

this

mem¬

have

stands

Socialist

represented

Copies of the Prospectus may be obtained from such of the
undersigned as may legally offer these securities in this State.

reason

should

be

committee,
an

it

unanimous

on

anything that really
matters, and if its membership is
recruited from among Conserva¬
tive economists
could

the

The

committee

contribute
of

the

will

towards

situation

the

than

similar body set up by the Labor

in
1930, which was
utterly useless in face of the crisis

of

1931,

even

among

suggestions

majority,

were

rejected

when

suggested

Professor
also

claimed:
us

though it included
its members. His

were

and

measures

cialist

G.

rejected,

"For

decide

Blytii & Co., Inc.

Leiiman Broth ers

Merrill Lynch, Pierce, Fenner & Beane

on

by

Bear, Stearns & Co.
Harriman Ripley & Co.

tne

Keynes

Ladenburg, Tiialmann & Co.

Lazard Freres & Co.

Incorporated

F. S. Moseley & Co.

opposite

by

H.

Eastman Dillon, Union Securities & Co.

Stone & Webster Securities Corporation

the

the

D.

Drexel & Co.

did

Government

Keynes

Salomon Bros. & Hutzler

workers.

proposed

more

solution
a

alone, its findings
inspire
confidence

never

among

August 1, 1977

al¬

be somewhat pre¬

it

Due

August 1,1957

and

movement

chairman and of the

of

bers

no

Debentures

the

unions

trade

But

Dated

ready announced that they would
not trust the independence of that
body. Considering that the names

that

Company

Only Innovation Envisaged

The
ent

5

time.

same

Wertiieim & Co.

So¬

White, Weld & Co.

Cole
ex¬

August 1, 1957

goodness'

sake, let
something!
If you




in

its renewed pledge

difficulties of finding one.

facturers to lower their prices. So
there

the

unemployment.
So
the
debate on inflation, so far from
having contributed towards the
solution, has greatly increased the

payment of additional wages will
remove the necessity for manu-

balance

on

before

feel justified

pipeline,

demand

Provide all the additional
?oods needed for. matching the
^creased purchasing power. His
*heory 1? most welcome, both to
trade unions which are certain to
cluote it: each l"116 their wa8es
^ema s are resist?d, ?nd to the
Government to which it provides
? very convenient excuse for doing nothing for the next 12 months,

0n

graver
will

manufac-

that is liable to

arise

After its latest procrisis will have

against

And even when,
delay of several weeks or

increased

the

the

much

going back

material pur-

market.
a

be

Government

on

will

are liable to produce
instantaneous effect on a sen-

sitive

in

doing its best to
boats by re-emphasizing

nouncements

chases, too,
an

But

is

employment.

There will be

buying

and

its

it

its determination to maintain full

before the additional goods appear
on
the market results in an in-

flationary time lag.

solution.

meantime

ric E. Vanderpool is now affiliated

instance, the

of

but, judging by the latest
banking figures it is quite ineffec¬
tive, and both ministerial spokesof

the

that

Parliament—is

crease

and when the situation should
become desperate the Government
dare
to
resort
to
what
it

dynamite,

con-

emphatically repudiated

Financial

rraises uansKeii

inflation

foe,

or

tinue,

intention

of

'"The

0f

if

Member twill

average

*be
oj^ v*ew °f dle internal existing capacity, the result will It would have required more postability of sterling, in the present tend to be inflationary rather litical courage than the Govern-

whether

measures.

"credit

to

con-

standing of the

ciustnal producing capacity. There months, the additional
*s 110 need, according to him, to tures emerge from the

Fight?

Tory, has done anything against

ficulties.

tiorfVlBut°the^
rejected

of

Macmillan

Exchequer

any

shadow

be

progressive economist

a

virtually

that

now

beyond

to

•

No

Mr

as

disinflationary defenses,
it has become evident

as
run

principle

basic

a

it that

end

some

said

v

headed by

Government

go

way

come

wisdom.)

gestures of reinforcing its
existing

men

dead"

cided

the

will

profound

same

inflationary pressure''

been

that

The

of

Britain. It had

t.inztg

expected

put

the

course

remark

inprices in

Paul

fenses

in

Why

to

in

itself through
of

:

tirm

a

some-

due

words

as

all

are

opti-

action

in

exasperated

q u a r-

ters, of

doubt

Quoted

we

enter-

in

No

inaction

—
and perhaps it would
have been well above the under-

wages, for an increase of the out-

philosophy

until

tnen

on

his'flippant.crack "In the lone

have

tained

decide

we

V

Keynes'

any

hopes,
may

opposite measures,

here probaWy for the first
time.'

dis-

of

the

decide

(This authentic incident is nub-

on

25

posed

suggestions

as

for

Roy Harrod has

he

correct

my

on

so

on

...illation

like

reason

so.

Uonary position could and would
zation

don't

second

that Mr.

appearing

capacity; and (3) lack of
spell out full employment's policy on
the price level.
V*

LONDON, Eng.-—The statements

necessarily remain

veniently produced a theory jusiifymg inaction. In two articles

full utilization of Britain's

a

producing

to

coverage

through

The
is

^.or assuming"

reason

that this will

explain

7

I

Stock

Ex-

and Financial Chronicle

The Commercial

MGO

Turnpikes—Progress report on certain major turnpike projects
—Smith Barney & Co., 20 Brood Street, New York 5, N. Y.
*

*

Dealer-Broker Investment

Lomb Optical

Recommendations & Literature
It
"

firms mentioned

understood that the

is

send interested parties

to

Bulletin

—

EVENTS

Milk

*

Atomic Letter

28)—Comment's on University of Michigan

(No

medicine,
shares of

Report about the beneficial use of atomic energy in
reports increased earnings and dividends on its
African

South

V. Phillips and Topp

Daystrom, Inc., N.

W., Washington

N.

Street,

1033—30th

Fund,

Mutual

Development

Inc.—Atomic

Industries.

Dept. €.,

companies and comments on Aero¬

uranium

jet-General Corp.,

7, D.

Inc.,

available

memoranda

are

on

New York

Club.

Municipal Bond Club of Chicago
21st
annual
field day
at the
Medinah

Molybdenum

Analysis

—

son

Trust Companies of

the

U. S.—Quarterly compari¬

institutions—New York Hanseatic Corporation,
Broadway, New York 5, N. Y.

of leading

120

Burnham

View

Monthly

—

letter

investment

—

Burnham

Company, 15 Broad Street, New York 5, N. Y.
able

is current

Sons,

Banks

—

Review

.James Richardson

—

Winnipeg and

&

Royal Bank

Building, Toronto, Canada.
Chemical
&

Ilaas,

with particular reference to Rohm
Chemical, Atlas Powder and Hercules

Monsanto

Powder—in August Investment

Letter—Hayden, Stone & Co.,
Street, New York 4, N. Y.

Financial Situation—Survey—E.

W. Axe & Co., Inc., 400 Bene¬

dict Avenue, Tarrytown, N. Y.
Government

Canada

of

and

the

Provinces

A. E. Ames & Co. Incorporated, 2

comparative con¬
ended March 31, 1956—

Wall Street, New York 5,

N. Y.

Problem—Discussion

in

issue of

current

of Utah,

Security Bank

/■

■

>

ter"—First

120

Company

Bulletin

—

—

Fall

Witt Conklin Organization,

De

Cities

is

A.,

N.

Association

bulletin

a

Corporation—Report—Eisele & King, Libaire,

KLM Royal Dutch

Airlines

"News

Let¬

Lake

City,

Utah.

Analysis

—

Wall

Co., Inc.

—

Analysis

Memorandum

—

H. Hentz & Co., 72

—

—

Bennett

&

Co., Equitable

&

Life

Insurance

New York

5, N. Y.

Bulletin

—

Also available

bulletins

are

Denver, P. Lorillard and Arthur G.

Current information

—

Compahy of New York, Inc.,

Ill

—

Yamaichi Securities

Broadway, New York

7',

a

re¬

view of the market outlook.

Limited—Analysis—Burns Bros.
Company Limited, 44 King Street, West, Toronto 1, Ont,

&

Canada.
Northwest

Review—Study—Harris, Upham & Co., 120 Broadway,

New

York

5, N. Y.

More Research

Else—Highlights No. 33 on "research-rich
companies" with particular reference to American Research
&

or

...

Development Corp.,

Electronic

Hydrides

Specialty
Inc.

and

Collins Radio, Electronic

Lithium

Co.,

Vitro

Corp.

Corporation

Associates,

of America, Metal

of America

—

Troster,

Singer & Co., 74 Trinity Place, New York 6, N. Y.
New York

quarterly analysis of 13
New York City Bank Stocks—Laird, Bissell &
Meeds, 120
Broadway, New York 5, N. Y.

Over-the-Counter Index—Folder showing an up-to-date com¬
parison between the listed industrial stocks used in the DowJones Averages and the 35 over-the-counter industrial stocks
used in the National

Quotation Bureau Averages, both as to
yield and market performance over a 13-year period —
National Quotation Bureau, Inc., 46 Front Street, New York
4, N. Y.

Petroleum Industry 1956—Financial analysis—The Chase Man¬
hattan Bank, Petroleum Department, 18 Pine

Street,

York

New

Mulliken

Pettibone

Bank Stocks
Comparison of 12 largest Phila¬
delphia Banks—Stroud. & Company, Incorporated, 123 South
Broad Street, Philadelphia 9, Pa.

Pfizer

Securities of the Instrumentalities of the Federal Government—

Pamphlet—Wm. E. Pollock & Co., Inc., 20 Pine Street, New
York 5, N. Y.

&

Rose Marie

Reid

Co.—Memorandum—Green,
Renort

—

& McKinnon,

April 23-25, 1958
Texas
ers

at

Holly¬

Ellis

Ander¬

&

Association

annual

meeting

Shamrock Hotel.

June 9-12, 1958

1

(Houston, Tex.)

Group Investment Bank¬

at the

(Canada)

Investment Dealers' Association
of Canada annual convention at

Troster, Singer & Co., 74 Trinity

Manoir

Place, New York 6, N. Y.
Shell Transport &

(Hollywood Beach,

Convention

Annual

and

Corp.—Memorandum—Doyle, O'Connor &

—

1957

Fla.)
Investment Bankers Association
wood Beach Hotel.

61 Broadway, New York 6, N. Y.

son,

Richelieu, Murray Bay.

Quebec.

Trading—Memorandum—Hemphill, Noyes &

Co., 15 Broad Street, New York 5, N. Y.

29-Nov.

Oct.

3,

1953

(Colorado

Springs, Colo.)
Soss Manufacturing Co.—Memorandum—Wm.

Buhl

C. Honey & Co..

National Security Traders Asso¬
ciation Annual Convention at

Building, Detroit 26, Mich.

Southern Pacific

—

Review

—

Peter P. McDermott &

the Broadmoor.

Co., 42

Broadway, New York 4, N. Y.

Join Walston & Co.

Transocean Air

La Salle

Lines—Analysis—Leason & Co., Inc., 39 South
Street, Chicago 3, 111.

Tung-Sol Electric Inc.—Data—Joseph Faioll &

—

Rails—Bulletin—Francis I. du Pont & Co., 1 Wall Street, New
York 5, N. Y.

the Homestead.

Co., 135 South La Salle Street, Chicago 3, 111.

15, N. Y.

Philadelphia

Oil,

Taylor

Penick & Ford, Limited, Inc.—Report—Thomson
11 Wall Street, New York 5, N Y.

Charles

City Bank Stocks—Second

Delhi

(Hot Springs, Va.)

National Security Traders Asso¬
ciation Annual Convention at

Corp., 1
Also available are re¬

Exchange Place, Jersey City 2, N. J.
ports on Three States Natural Gas,
Big Piney Oil & Gas.

Exchange

ing at Beverly Hills Hotel.

Securities

Production—Report—Western

Stock

of

Nov. 3-6, 1957

Dec. 1-6,

New York.
Market

Angeles,

(Los

Firms Board of Governors meet¬

Gardner-

on

McKee & Co. and

1957

10-11,

Calif.)
Association

Bache & Co., 36 Wall Street,

Northern Telephone Company

Japanese Stocks

Omaha Club).

Company—Study—Robert H. Huff

Co., 210 West Seventh Street, Los Angeles 14. Calif.
—

and

Happy Hollow
Country Club (to be preceded
by a cocktail party, Oct. 9 at the

Oct.

Building, Hollywood 28, Calif.
Nationwide

frolic

annual

field day at the

Street, New York 5, N. Y.
Corp.

Investment

Association

Ira Haupt & Co., Ill

—

(Omaha, Neb.)
Bankers

Nebraska

Broadway, New York 6, N. Y.
Marmon Ilerrington

Exchange

ing at Mark Hopkins Hotel.
Oct. 10, 1957

J. P. Burroughs & Son, Inc.

on

Stock

of

Firms Board of Governors meet¬

Co., 50 Broadway, New York 4, N. Y. Also available

Norden-Kctay Corp.

■

Salt

Gas

Meeting at Santa Barbara

Biltmore.
Oct. 7-8.1957 (San Francisco, Cal.)

Broadway, New York 7, N. Y.
Gulf

(Santa Barbara,

Investment Bankers Association

bulletin

a

•

Broadway, New York 5, N. Y.

Meletron

densed statements for the fiscal year

Inflation

Gabriel

Stout &

Stocks—Review,

25 Broad

Also available is

Broadway, New York 6, N. Y.
Wheeling Steel.

(pre¬
12 at

Cal.)

Co.,

Gob Shops of America—Analysis—Bruns, Nordeman & Co., 321

Portage Avenue, East,

173

Also avail¬

Letter.

Foreign

Canadian Chartered

and

115

by

Sept. 25-27, 1957

Consolidated Cuban Petroleum—Report—J. R. WiJliston &

on

a

Club
dinner Sept.
the University Club).

Laird, Bissell & Meeds, 120

—

Country

ceded

5, N. Y.

Broadway, New York 5, N, Y.
Banks arc!

(Chicago, 111.)

1957

Sept. 13,

Meredith Publishing Co. aqd A.

Analysis —Halle & Stieglitz, 52 Wall Street,

—

Columbine Country

ment at the

O. Smith Corp.

Chrysler Corp.

frolic and golf tourna¬

summer

Also

analysis of the First National City Bank of New York.

Climax

C.

Street,

IBA annual

Mountain Group of

Digest"—Loewi & Co. Incorporated, 225 East
Milwaukee 2, Wis. In the same issue is an

Financial

Club

Bond

tion, 92 Liberty Street, New York 6, N. Y.

Mason

(Denver, Colo.)
of
Denver-Rocky

Aug. 1-2, 1957

George W. Borg Corp.—Analysis in current issue of "Business
and

Field

Also available is a bulletin

Street, New York 5, N. Y.

the Prophet Co.

on

Investment

In

Ceorgeson & Co.. 52

—

Baystate Corporation—Analysis—Plymouth Securities Corpora¬

will he pleased

the following literature:

Wall

Co.

COMING

»

Products—Analysis—du Pont, Homsey & Co., 31
Street, Boston 9, Mass.

A. S. R.

Bausch «fc

Thursday, August 1, 1957

...

New York 6, N. Y. Also in the

way,
on

same

(Special to The Financial Chronicle)

CHICAGO, 111.—James P. Han-

Co., 29 Broad¬

bulletin

are

data

McGraw Edison Company.

rahan, Owen M. Mason, Leroy B.
Murdock
have

With Jerry Thomas

David

(Special to The Financial Chronicle)

PALM

BEACH, Fla.—Verdo C.
is

Sanderson

with

Noyes Adds

&

Co.,

Street.

(Special to The Financial Chronicle)

CHICAGO, 111.—Harvey G. Dil¬

and

Gerald

B.

Rivlin

joined the staff of Walston
Inc.,

201

South

Mr. Hanrahan

ously with Norris &

La

was

Salle

previ¬

Kenly.

Mr.

Jerry

lon has been added to the staff of

Co.,

Inc., 238 Royal
Palm Way. He was formerly with

David A. Noyes & Co., 208 South
La Salle Street, members of the

with Rodman & Renshaw, and Mr.

Woodbury, Foster & Parker.

New York and Midwest Stock Ex¬

Rivlin

Thomas

&

now

Mason

and

was

Mr.

Murdock

were

with Irving Weis & Co.

changes.

With

For Financial Institutions-

Webber-Simpson

With H. B. Shaine Co.

(Special to The Financial Chronicle)

CHICAGO,.
Current

Ill

—

Thomas

Harris has become associated with

Trading Favorites

Polaroid

.

.

.

Corp.

(Special to The Finani

M.

Webber-Simpson & Co., 208 South
La Salle Street, members of the
Midwest Stock
Exchange.
Mr.
Harris was formerly with Leason
& Company, Inc.

GRAND
ert

M.

with

Connors

H.

B.

Tower.

is

Mich—Rob¬

now

Shaine &

Mr.

TRADING MARKETS

Chronicle)

nr.

RAPIDS,

Co., McKay

Connors

FLORIDA

affiliated

was

pre¬

viously with Ira Haupt & Co.

SECURITIES
Bank, Insurance Companies,
Industrials

Dictaphone Corp.

DEPENDABLE MARKETS

Northwest Production
Invest in

Three States Natural Gas
Bought

—

V

Sold

Delhi-Taylor Oil

i

I

Big Piney Oil & Gas

I
I

TROSTER, SINGER & CO.
Members:

74

New

York

Security Dealers

I

Special Reports

One

DEMPSEY-TEGELER & CO.

Triangle

DEPARTMENT-

TELETYPE MM51
zmmmmmmmmmmwzmmmmmmm

on

Request

Western Securities Corp.

Trinity Place, New York 6, N. Y.




TRADING

ALFRED D. LAURENCE
&

Association

Florida's

Golden

Exchange Place, Jersey City, N. J.
Telephone HEnderson 2-1000

Open-end

phone to N. Y. C. HA 2-0185

I

COMPANY

INVESTMENT SECURITIES

201 S.E. 1st Ave. Miami, Fla.
Phone: Miami, FRanklin 3-7716

Number 5660

Volume 186

The Commercial and Financial Chronicle

...

(481)

its

crease

Challenging New Dimensions for
American Foreign Operations
By HARVEY WILLIAMS*
President, Philco International Corporation

Williams

proposes

and manufacturing

abroad. Calls attention to the devel¬

subsidiaries and branches abroad and
finds it is supplanting exports as the traditional method of
penetrating foreign markets. Convinced of growth opportu¬
nities for maximum market penetration and profits in the next
two decades, the Philco International head discusses factors

Imagine

advanced

two-thirds
States

within

This

of

United

the

States

which

enjoys
highest

the

living

ever

particular
industry

h i

The

t

s

o r

y.

of

our

people,

of American
to the
rapid development of South

attention

en¬

supplement

a

as

backstop to

our

In

Latin

ditions,

We

Market
all

are

will

development

Civil

our

ments

from

nations.

great

gree

0f economic development in
America,
than
in
some
other
areas,
means
that
these
economies start, today, lower on

shall

the upward curve of

the

in

and

corn

wheat growing states to dishwash¬

ing in

individual

our

become

homes, has

great that we have out¬

so

domestic

our

run

supplies of im¬

portant

raw

materials and must

abroad

for

iron

aluminum,
and
a

bauxite

ore,

go

for

molybdenum

copper,

manganese—-just to

mention

will
for

of the great

wonders of the world.

What

can

more

be

reasonable

challenging now, than that

more

financial,

production,

or

selling

brains

administrative

and

which

have created this standard of liv-

should be
assisting our friends
raising their standards
by supplying them
or

ing in our own country
turned
abroad
of

to
in

living

teaching them how to produce for
themselves, more of the goods,
services
are

and

American
T

:

.

,

decades

the

on,

scene.

convinced

am

whieli

conveniences

commonplace

now

two

,,

,

.

that

next

the

demonstrate

will

such overseas extension of activities to be one ot the

great growth
opportunities in both sales and
profits open to American industry:
To

accomplish such an objective
enduring peace and
widespread prosperity requires overall, long range planning. Business
expansion abroad is dependent, to
a
large degree, on political im¬
plications. The seething Middle

for

East is

these
vv* /my%

more

capital will continue at a high

for successful

vivid demonstration. For

a

reasons,

anf

mi

moment

on

Vl

may
r\

I reflect for

WT rv -»-»l

the World

r\ n

urn

as

we

-Pi

n

a
d

find

today and then offer some sug-

gestions for business development
abroad

in

light of present condi-

large

enterprises in these

Britain

carrying

is

under

on

^

an

ture and sell in

of

sufficient

goods

a

to

manufac¬
quantity
earn

the

to buy the remaining 60%
of its food plus its requirements

shelter

clothing,

other

and

personal needs „iu, the raw maferials with which t0 continue the
manufacturing

a

flow

that

of

produc¬

investment in Europe due to its
proximity to the Communist Area
in

Hungary

indicate

and

restlessness

for
of

a

in

return to the ideals and ways

the

free

enterprise

the

In

enormous.

and

The

easily sub¬

more

because

illiteracy. For
alone, they should

special attention of the
officials of

but,

more

interest

foresighted

aid

and

our

Gov¬

particularly,
of

our

able

an

technological development is
why we find growth trends abroad
roughly
double
those
in
the
United States.
U. S. Dollars Must Come Back

almost

at

life

of

of

us

basic

but let

ures,

create

in pri¬

at

the rate

$17 billion a
year.
Concurrently, our imports
are
on
the order of $13 billion.
The differential of $4 to $5 billion
is

approximately

a

important factor in our
with other nations.

very

relationships
If

it

had

been

not

made

economic

aid

abroad,

American

and

system

continues, and manifests itself
wllh violence as it did in Hungary,
°ne cannot escape the risks of
proximity
to
such
potentials.
However, if the Eastern Satellites

When Britain devotes too large
proportion of its total ma ihours to making products for ts
domestic market the goods avail-

east

Asia,

with

their

need

Communist

lessened

and

for

China

then*

trade

will

be

economic

rise quickly. The
American companies which have
established operations in Japan,
potential'

can

often in association with Japanese
concerns,

would benefit substan¬

Australia

In

dollar wnich

for

ment

situation

—

a

is

there

continent

special

a

equal

in

goes

abroad

for a
development,

ment purposes,

nomic

for

penditure

or

course,

United

States

American

eign

goods

or

of

Britain's

earnings' of

purchase

to

consisted

largely

on

Southern Pacific

so

page

Company

currencies

Consequents, the British Govfinds itself continuously

Equipment Trust, Series XX

ernment

the

on

horns

wouJd like to

a

diiemma.

It

4 V2%

Equipment Trust Certificates

living of the British people

of

ard

o£

increase the stand-

(Philadelphia Plan)

by allowing a greater proportion
Gf total production to flow into
domestic
consumption.
On
the

hand,
it
must
maintain
controls, through taxes or other¬

To

mature

$400,000 annually June 1, 1958 to

1972, inclusive

other

guaranteed unconditionally as to payment of principal
by Southern Pacific Company

To be

wise, designed to force a substantial nortion of Britain's producinto

tion

export

razor

markets

!

*

a

^

earnings

and dividends by endorsement

MATURITIES AND YIELDS

and so
foreign
exchange. It is a highly developed
society balancing on an economic
•

maintain

_£*

(Accrued dividends to be added)

of

1958

1959

4.10%

1960-72

4.50%

4.65%

edge.

tions.
Common

Business Development

Conditions

Abroad

Canada

including
that

dian

currency

many

continue

to

Many,

our

consider
as

companies
their

part

Cana-

their

of

activities.

I

am

sure,

.

are

familiar

with the "Fortress America"
ceot

which

conceives

New

'
York City.




con-

main-

the

J

tion,

own,

and language,

American

operations

domestic

like

so

pr0aches

a

the

slowly

Is„,ana ami sale of these

ap-

The

swept

be

Certificates

15

'

inated

a period of 12 or
barriers against the
be elimsubstantially, and
labor

flow

sections

with

can

a

the

over-populated

unemployment,

to

providing jobs, we
look forward to the possibility

Industrial

of

HALSEY, STUART A CO. INC.

of goods can
from

areas

unified economy, of approxi«» million people
with

opportunity

to

1

'

years,

can

Commission.
which this announcement is circulatedfrom only
lawfully offer these securities in such 1state.

subject to authorhation by the Interstate Commerce

away

quickly. If, over
movement

are

Offering Circular may be obtained in any State in
of the undersigned and other dealers us may

such

reality. Not all customs

will

barriers

Challenge
Europe,

Market

Common

enjoys circumstances

and environment

Market's

Continental

In

greatly

in—

DICK

A

MERLE-SMITH

FREEMAN

A COMPANY

WM. E. POLLOCK
July 26. 1657.

R. W. PRESSPRICH

IRA HAUPT A CO.
A CO., INC.

A CO.

BAXTER A COMPANY

McMASTER HUTCHINSON A CO.

SHEARSON, HAMMILL A CO.

of

products

$6,000,000

foreign

ex¬

back to

services.

agricultural

Continued

size to the United States, wealthy

come

\yorld War I, our for¬

trade

exports

an

security

military

wilk in due
the

as pay¬

for invest¬
loan for eco¬

import,

an

Prior to

tially.

?

able for export diminish—and

in¬

customers
foreign countries would long
Japan
is
an
island
economy
since have used up their avail¬
which must import and export to
able
dollars.
Our
exports then,
maintain
its
existence.
If
the
would be necessarily of somewhat
Japanese will hasten the conclu¬
the same size as our imports. Of
sion
of
reparations
agreements
one thing we can
be sure—every
with additional nations in South¬

.

,

.

.

by

our

which it is de-

on

...

up

military aid expenditures, foreign
vestment

managers

fig¬
them to

reference. Our

of

running

are

with

trade

restate

us

frame

a

exports

familiar

are

foreign

£or existence,

endent

-do

with a dramatic
mortality, a
the average span
accelerating pace

infant

in

in

from the United States,
Currently seme risk attaches to

events

free

vate industry.

and
material well-being in
Europe will be financed, in part,

Poland

the

Communism

reason

and

his¬

during

and

renaissance

combined

reduction

of

the

_

money

for

capital

which

of

reversal

in

living

areas

by

This

urgent desire for a better way of

Most

are

-work

higher standard of living.

a

certain

ernment

If their
special the Eastern Satellites.
40% of its desiie for self-determination and

_

it must
export

but

food,

economy

verv

circumstances. It raises
own

toric

a

are

people

have

beginning of World War I.
well be on the verge of

see

common

will

of

area

foreign aid

may

Kecent

countries.
Great

phenomenal

development
of the American economy is, one

the

be

development.
of growth
rapid, their demand

their irate

level and the returns will be

few.

The

it

Therefore,

We

no

which

remains

that

tion

acreages

and the

find

we

lengthening of

of their poverty and

several decades during which we

South

Harvey W iinam*

entirely unique to these
The relatively lesser de-

pene¬
maximum

witn

to meet the universal demand for

These

by

activity
farming

of man¬

urgent need for encouraging and
economic
development

existing
in these economies are totally dif¬
ferent
from
those
existing
in
Europe, Africa or South America.

War

of all kinds of

men

assisting

circum¬

verted

environ¬

of

believe

stances and environments

the

financed

was

end

in

operations.

as

overseas

profitability,

life,

who

business

minimum standards.

Britisn and European capital bethe

tration

poten¬
portion of Southeast

the

million

economic

tween

unde¬

very

Pakistan, India, Burma, Thailand,
Malaya, Indonesia, and the
Philippines, there are some 700

the

with

our own

the

of

of Africa.

future

enterprise

corollary

of those

one

which

create.

familiar

degree to which

am

the

in

areas

of

find tra-

we

and

customs,

in

warfare.

America,

Common

it

tials

Exporters

which

economy

with

Asia

their parent organizations
shared in the expansion of

panding

and

economy

own

the event of atomic

hanced by the
mechanization

government

and

America

produc¬

tivity

in

and

areas

Consequently,

participation in Euro¬
business activities may well

for

ized capital goods and otner types
of products required by the ex-

materials

raw

Africa.

the

will benefit by supplying special-

of

any

by
nation

I

as

domestic economy.

interested

the East African

that

companies
which
become
established in Europe now will
share in this economic develop-

our

in

veloped

can

have

Consequently,

include

to

denominators

participation

American exporters alike. Ameri-

ment

French

in

for

and

afford
overseas

equally well in every country. The
only common characteristic is the

carry

1940.

opportunity

an

manufacturers

well

plans for

securing maximum markets

European economies.

the

see

pean

of

South

stores

achieved

in

and

society particularly friendly to

can

American

col¬

America. Its proponents urge the

of

standard

is

American

American continents utilizing the
scientific, technical and production
experience
of the
United
States and Canada in conjunction
with the large population and vast

a

auto¬

1920

outstanding
since World War II. It is

progress

agement approach the objective of

South

witnessed in the United

between

which has made

one

a

ish

to

development

Asia

Tunisia, Algiers,
and
the
Sahara;
the
Belgians in the Congo—the Brit¬

there

the

cur¬

resources,

Morocco

United

with

and

likely that Africa will
developed from Europe and
seems

heavily

use

million

Europe
the

we

States

society

and
boundaries

the

which

tenance of the free enterprise
system in the North and South

economy

an

in

the

natural

populated by only nine
million people. It is an economy
in continuing need of capital and

will be the special expansion area

Eu¬

Then,

35

some

activities

inventivehave combined to

skill

and

ness

fashion

in

vast

of the older

lateral manufacturing and service

as

American enterprise,

that

be

mobiles

and that utilization

nations,

be

in

rently

the American way of doing busi¬
ness
and one
whicn Americans

Africa
It

We

bring the

currently.

would

new

through P. L. 480,

Market.

mon

people,
million

of automobiles within 20 years

of funds
suggested, would aid orderly
growth of underdeveloped areas and help win the cold war.
more

obtained

might

more

the European area may
bright future by virtue
development of the Com¬

a

the

of

168

development in

a

which

rope

requirements demanded of an
executive engaged in the "New Dimension" of foreign oper¬
ations. Points out that the world-wide capital shortage favors
the

of

economy

self-deter¬

by the slower and

in

have

exciting potentialities of
this
development can be illus¬
trated by a single comparison. In

economy
of 180 million
there
are
now
only 14
automobiles.

opment pace of U. S.

prompting this and the

ments

The

American

of

measure

a

conservative tactics of Yugoslavia
and
Poland,
American
invest¬

biles. In the Continental European

foreign borrowers to make possible further private invest¬

ment

regain

mination

and

people today, there are
approximately 52 million automo¬

through the sale of surplus U. S. commodities, to American
and

living by

million

lend foreign currencies, gained

we

of

production ; costs

increasing productivity of the in¬
dividual—much as has taken place
in the United States.

the

Mr.

standards

lowering

9

32

August 1, 1957

Commercial and Financial Chronicle..'. Thursday,

The

10

(482)

ginning,

Recommended Tax Changes

Steady Economic Growth

Foi

By JOHN F.

j.

Radio Corporation of

Director,

Tax

COSTELLOE*

America

RCA's tax authority submits tax changes are in order for two
kinds of pioneering business activity, one, to encourage U. S.

j

j

We
tax

kinds

what

asked

are

of

would promote eco¬
stability,
reduce
tax-in¬
distortions
in
resource

changes

nomic
duced

Competitive Disadvantage

and small

tax
are

for

in

two

of

kinds

pion eering

whose

corporations

foreign

stock is held to the extent of

is

foreign
markets
and

mission

from current
tax,
foreignspecial kind Of

which would exempt
United

The other is establish¬
domestic markets for new

business.

with a Federal

products burdened

10

Kingdom
income of

source

a

corporation, "that

United Kingdom

an

in¬

for

as

multimillionaire

private enter¬

of

Oklahoma, and

who

admits

and

than

tele¬
vision sets and to color television,
freedom from the special burden
of excise tax comparable to that
accorded
black and white tele¬

is making

amortization

for

around

Idaho

H

build

e

Bargeron

City

Company as an ex¬

when the plant is in opera¬

the

tion

has

it

to

Korean

working

passed legislation
opening of a new office in Salt permitting plants to write off the
of plant extension in five
Lake City was announced by Je¬ costs
rome F. Tegeler, senior partner of
years
instead of the normal 20
Dempsey-Tegeler & Co., St. Louis years. The idea was to get more
investment securities firm. In ad¬ plants. Manifestly this five years
dition, the firm has purchased a period was the thing for indus¬
fleat on the Salt Lake City Stock trialists to take if they figured
there would be no need for tieir
Exchange.
The new office, which will be additional
plant
capacity
after

the

to

taxes

pay

Even the employees

Government.

Congress

War,

CITY, Utah—The

LAKE

to

Power

Then

During

scandal.

plant

new

every

and brings in more
the Treasury. Take the

In the first place there
more jobs to build the
plant.

are

1 Is

Canyon, came up with what they
advertised as the great tax write¬
off

investments.

ample.

Carlisle

to

license

in¬

encourage

and

it

sees

revenue

nullify the
Government's

Dempsey-Tegeler Now

to

increases jobs

to

arguments

erudite

in the Senate,

study of quicker tax

a

plants

he

As

erals," looking

vision for several years.

In Salt Lake

creased

"lib¬

The

Morse,

more

anybody else

plants.

policy

tax

accord to all-channel

Kerr

Senator

Wayne

is

he

build

prise to

years

additional

wise

view,

my

would

SALT

1955, a Britain Royal Com¬
recommended legislation

In

Costelloe

F.

John

25%

more.

or

es¬

tablishment of

ment of

foreign

from

business

activity.
One

and
actively

taxation

ago

submit

order

current

with

income. Canada long
exempted foreign-source in¬
come of a special kind of Canadian
corporation from any Canadian
tax. Some years ago it exempted
from tax, dividends received by
Canadian
resident
corporations
of

businesses.

changes

Britain, have been

concerned

¬

Canada

countries,

porting
Great

climate for

that

public

the

to

Capehart of

E.

Homer

who has received some
newspaper
publicity recently by
tangling with such "intellectuals"
Indiana,

ducement

into

newer

In

major capital ex

The other two

improve the
competitive

I

available

generally?

Senator

fair to turning

Company's sales
products and services not

of

business

plishing their
purpose, bids

1955, 80% of the
were

the tax laws be so as to encourage

Canyon project, instead of accom¬

payments run about four dollars
twenty cents for each dollar
of
common
dividends;
and,
in

Why shouldn't

entertained before.

against pri¬

made

not have

Senators which they may

which the so-

fight

great

liberals

enterprise building the Hells

vate

before.

allocation, and

new

The

called

and

expansion of two-way
international trade."

of the News

By CARLISLE BARGERON

example, total RCA tax

For

Washington

Ahead

public has been enormously ex¬
pensive. RCA has spent more than
$100,000,000 on color television so
far, and in 1956 color television
reduced its earnings by approxi¬

ness.

the

much

From

high as
appliances.
Bringing color television to the

imposed on set sales.
New products are important to
Government as well as to busi¬

contribute

developed areas, could

at a rate twice as
that applied to most home
and

mately $6,900,000, a large part of
which went for Federal excise tax

investments abroad and, the other, to prompt new product
development in the domestic market. Maintains tax policy
designed to help new business to attain success results in small
revenue yield loss in comparison with objective and the devel¬
opment of new revenue sources.

\

be¬

television sets from the

color

building

the

on

project

taxes and that means more to
Government. He feels
that

pay

the

businesses should be encour¬

new

aged

in

It is

way.

every

question

not

a

"liberals"

the

con¬
that the Government loses

tended

as

quicker

permitting,

by

money

write-offs.

It is

question of de¬

a

recommendation
was
similar to
veloping more businesses to make
the
unanimous
recommendation
money
to pay the
Government
expenditures of
for the United States by panelists located at 345 South State Street, five years.
more money.
resources in the hope of success¬
in
their
But the law is still in effect and
appearance
before the brings
to
21
the
number
of
The
Indiana
Senator
could
fully establishing new business.
Subcommittee on Fiscal Policy in branches Dempsey-Tegeler & Co. it has been taken advantage of by
hardly be classed as an "intel¬
The" United States taxes each
1955.
numerous
business
enterprises lectual" like Morse or like multi¬
operates in 19 cities.
without reference to the attain¬
There is now pending, United
Office manager of the new lo¬ whose additional plant capacities millionaire
Kerr, each of whom
ment of success. The revenue yield
Kingdom legislation which would cation will be J. Arthur Pett, who or
even
original
plants would has books at his command with
is small in comparison to the im¬
implement that recommendation was a general partner of Pett & have to stretch matters to say they
quotations of sharp things to say
pediment to essential economic of the
Royal Commission.
The Morris, Salt Lake City investment were in the interest of national in debate. But he is undoubtedly
functions and development of new
parliamentary system gives
as¬ securities firm. In addition to Salt defense. Others have thought this one of the
sharpest business minds
sources of revenues.
surance
of
enactment
in
due Lake City, the Pett & Morris firm was
no
bargain
because
after in the U. S. Senate. He has proved
course.
had branch offices in Boise, PocaForeign Investments
writing off the tax in five years, this in his own business success.
Enactment
of
such legislation tello and Idaho Falls, Idaho. For then they would have nothing to Facts seem
In the foreign field, a business
to
be
facts
to him

excise tax.

involves

Each

conducted as an ordinary

domestic

corporation must pay full current
rates of United States income tax,
on

even

plowed-back earnings.
though the coun¬

This is true even

be

may

United

of

States

of

each
listed

Growth

of

though it has provided special tax
relief. The United States cancels

three

States

benefit

the lower foreign

of

credit for

the

reducing

by

foreign taxes.
recent Economic Re¬

In his most

port

attention

the

to

of

operations

foreign

creates

business

markets for businesses of all

new

sizes; new opportunities for labor,
technology and capital: and means
for
obtaining from abroad ma¬
terials on which all depend.

President

the

Congress,

to

called

a

the

ated

past three years he has oper¬
J. Arthur Pett & Co., also a

securities firm.

Mr. Pett in the

Associated with

great

the

of

United

rate

businesses,

importance from
standpoints
in the schedule of hearings.

matter

try of operation has relatively low
rates
of
income tax,
and even

the

increase the

to

expected

existing competitive disadvantages

Dempsey-Tegeler office will

new

J.

member
ment

of

the

of
A.

trading

P.

Kibbe

&

firm.

Lake City investment

Kranz & Boge

Are
(

Grimm
Now

for

the

&

Co.,

second

44

private investment

Street,

the President had

urged that for¬

returned to the United

that

it

the

same

be

then

Western

rates

until

taxed

be

not

income

eign

States, and

taxed at about
provided
for

Trade

Hemisphere

cor¬

increased

"An

abroad,

statement

*A

the

Joint

mittee

flow

of

United

investment funds
especially to the under-

private

States

on

by

Economic

For

Mr.

Costelloe

Committee,

before

Subcom-

Fiscal Policy.

with

burdened

several

a

the

excise

sets

were

imposed

tax

and

spared

on

market

of

sales the
as to
yield

untaxed

developed

general partnership in the firm.
Kranz was formerly vice-

so

president

Dis¬

Fund

Putnam

of

tributors Inc.

$100,000,000 in excise tax in
1950, the first
year
of tax on

over

Oil the Other hand, the 10%
GXCise tax Was imposed Oil all —
channel television sets and Oil

went

Government

the

announced
the
association with them of Mr. Her¬
has

bert B. Abelow.

taxes

Joins

Incomplete?

LOS ANGELES, Calif.—Samuel

"FOR SALE"

Sewall

is

now

with

connected

five years

such

a

hue and

cry
Company

write-off pro-'
had
been

they

which

this, or
it,
they have won their fight in Con¬
gress, certainly for the time being,
to go ahead with their license to
granted

because

and

of

"CHRONICLES" from 192G thru 1952

Pierce,

Inc.,

Fenner

&

First California Adds




c/o Chronicle, 25 Park PI. N. Y. 7

SANsr FRANCISCO,
mons

to

W.

the

Calif.—Em¬

Sawyer has been added

staff

of

First

Stock

of

the

Exchange.

California

Pacific

visit,

be¬

and

be

Also, there
sightseeing programs
attractions, receptions

workshops.

craft

will

full

major

and social recreation.

The

tour

of $980

price

covers

transportation from New York
(and within) Europe and back;

all
to

ruefully admit they have
fight but they think

Breakfast

crowd,

their

lost

the

of

giving

Coast

away

our

natural

"owned by the people,"
greedy private interests.
have

written

never

from

any

sources

enjoyed
these

of

that

before

that

I

a
dividend
natural re¬

"owned

are

by

the

people," including me. but devel¬
oped by the government in the
interest of
But

me.

what

the

instance did not
it

Viiij?

crivpn

transfers

accommodations;

taxes,

all

and

several luncheons and dinners.

against

Administration—

Eisenhower

that

issue

another

have

resources,

Company, 300 Montgomery Street,
members

will

members

exchanges, industrial plants

airport - hotel
sightseeing.
is included daily, plus

I

(Special to The Financial Chronicle)

Edwin L. Beck

American

Exchanges.

Tour

sides

of

and

York

New

Stock,

hotel

have

iPhone REctor 2-9570

partner of Winslow, Cohu & Stet¬
(26 Broadway), members of

son

gratuities,

Beane.

Available in New York City—Write or

a

first-class

to

Lynch,

with
general

originated

Billings,

The "lib¬

Merrill

Beautifully Bound Set of

Durst,

W.

Pearne

that the
turned

fraternity

ment

the

maybe it had little to do with

they

&

project

instead of 20.

Power

vision

626
South Spring Street, members of
the Pacific Coast Stock Exchange.
Mr. Sewall was previously with
Wagenseller

will leave New

Europe"

erals," which means primarily in
this
instance
the
public power

Wagenseller Staff

(Special to The Financial Chronicle)

S.

of

Tour

income
they already

properties

on

build the dam or dams.

Are Your Records

was

their

deduct >from

could

down the five-year

New York City, members of
the Philadelphia-Baltimore Stock

yen

exchanges are being given
opportunity in a new, fourcountry tour announced by the
British Overseas Airways Corp.
The 1957 "Investment Brokers'

the other hand, they

On

borrow.

Idaho

Mitchell & Company, 120 Broad¬

a

this

Well, the "liberal" agitators set

way,

brokers with

on-the-spot study of Euro¬

an

pean

town on it. They
propaganda to the

to
a

that

for

Europe

Street

Wall

private operators this York's International Airport on
plant.
The fact was, of course, Sept. 20 for a 15-day look at Stock
that the private operators had to
Exchanges in London, Zurich, Co¬
build this plant with their own
penhagen and Paris.
money or money which they could
Idea of a tour for the invest¬

up

Exchange,

Company

Power

giving the

Herbert Abelow Joins

television sets.

Tour of

that

happens

so

developed

in

Mitchell & Company

quotations.

BOAG's Stock Brokers'

after the
got their
license to build Hells Canyon they
asked
for
and
got
a
five-year
write-off
certificate.
This
gave
the "liberals" their "scandal" and
It

Idaho

owned, the cost of this new

sales

of radio sets and other articles. In
years

to

Mr.

black

years

white television

the

porations. He said:

product

new

Federal excise tax.

Bartlett's

the

period.

the 20-year

over

effect

Wall

New York City, members of the
which would
pioneering
business
activity
to New York Stock Exchange, an¬
be provided by letting the tax¬
which I have referred, establish¬
nounced that George Kranz and
payer have the benefit of special
ment of a domestic market for a
foreign tax relief. Early in 1955,
August Boge have, been admitted

to

it

they

Partners in Grimm & Go.

Domestic New Products

incentive

depart¬

Co., Salt

without

business
judgment whether one wanted to
get the five-year write-off or take
period. It was a matter of

former

Mawod,

Edward

be

15-year

ensuing

the

in

off

write

Complete

Sales
530
It

Development Officer, BOAC,
Avenue, New York 36.

Fifth

also

is

obtainable

BOAC

district

United

States

sales

in this

M.

Barton has

H.

E.

tn

prmeiprvativp

from

office

in

any

the

America.

of

With H. E. Johnson, Jr.

anticipate is that

irlpne

sup¬

a

ARVADA, Colo.

"liberals"

is

information

folder, "BOAC Invest¬
ment
Brokers' Tour of Europe,"
available without charge from the

plied in

Mrs. Jennie

—

joined the staff of

Johnson, Jr., 7020 Garrison

Street.

-

-

•

.

^

•«

Number 5660

Volume 186

The Commercial and Financial Chronicle

...

(483)

'

1

ate fund needs and the
ability of
others to help them. Let us now
look at their investment needs.
"•£1#

Of Union Pension Funds

Fund

The

Partner, Paul Howell Associates

after

union

in

weighing the relative merits of brokers, trust officers, and
counselors, avers union pension fund managers are

the

the

of

size

objectives

ment

the

are

advice,

to

and dnfor-

counsel

mation which

of

the

advisers in whom they have trust

and confidence.

"

'

iunus?

Before

1

Initiating

different
of ad-

kinds

visers it is ap-

propriate to
first

consider

kinds

the
f

i

a

n

of

cial

n

problems
which

There

for

need

attention

for a sound begindecisions, inconsistent
with
the
objectives of the
union pension fund,
may be ex-

Initial

tremely

difficult

later time.

best

to

They

efforts

of

rectify

at

.

subsequent

Investment
A.

of

the

some

for

of the
invest-

an

.He must

port-

be

If I

sion

man

a

ex-

to

,

nfl

,tf

mqSooo'

it

Aj

,

A

—

time, technical job.
can

funds, it will be to emphasize

this

is

not

job

a

for

part-time

amateurs,

in-

"
y'
common
1S m?re exP®nsive

r

Guidance

Management

make any contribution
improved management of pen-

to

u" sT\h\ndc^flt?vr0TgoindUS;
ct

Investment

equires moie re-

cimoi-wies™

time
imp0SSible task. A competent in¬
vestment
adviser
or
manager
ghoyid

jiave

extremely

an

broad

^ ^ nigher degree of knowledge of what is going on.
lodgment. Bond in- Qne nee(js
have a knowledge
rinOfsJetv nnnroSh1Vpnnmah; of business c^les> interest rates,
LomL
taxes, governmental spending
imaginative^nSyS As a con- ^rogram,s' world Politics> economic
Kii-+

v

r

o

of

crete

.

,

examole

would

one

not

^eoS^Phy,

trade

developments,

adviser forTcommon etc" °n fche other hand' he needs
predominant ca.,h in- select
sS
^rtion ^ a short-term per- ~ f— the particular
pension jtoid a -A, A a
who
the
r 0± Particular
tho fimd-c 0 n 11 n u e d
sonal loan officer of
commercial
'

)Il

.

^

an

,

man

of

8 o\\ "i oi tne iuna,

was

a

f

t

.

v

For

bank.

fPu
? dl.y or cash reseive,

example,

if

you

to

were

.

a

man-

HI
Selection of Competent

of

full

outline

adviser.

as

ffrowth

instead

imagination and foresight,
perienced in common stock

in

nature

tion may already be diecounted
for many years in the future,

policy.

brief

<

making a correct judgment as to
the earning capacity we pay too*
high a price. The growth expecta-

rate,

of

are:

long-term

even

imaginative in-

more

specifications

ment

necessarily affect
designed to imple-

pension fund

(i).The

fV'0^

invest

B.

It .is urged, contrary to

nullify the

may

job

Further¬

investing

a

bonds

folio helps crystallize

the

the^investment program;

to

fundamentals

ning.

This

funds

£

<

in

Retirement Program

a

is

vestment

dur¬

objectives

as

remembered,

government

following

a'^a^ reTum'The predominate
rSriSTa

•

Investment Decisions Inherent

appraising the

in

distri¬

and

set

real-

a

istic price to pay for these expectations. It may well be that after

that it may be more costly, in
terms'of fewer benefits, to invest

increase

increase

than 25%.

such

policies

union

pension

union

will

adequate reup for the
unprofitable situation,
be

It also must be

The operating characteristics of

pension

be of assistance

can

managers

o£ invest-

sources

An

and

should

absent changes in the interest

housing for union members.

an

important plan in the union pension portfolio.
What

fund

invest¬

should not be confused with social

dominating

a

stocks have

common

all

yield of 1%

investment

more,

Prof. Howell be¬

of return

the rate

factor, and explains why diversified

pension

accumulation
more

everywhere

serves

inevitable

in

costs.

or

period

benefits

long-term opportunity for compound interest

work makes

to

the

bution

better off if they obtain the help of carefully selected, inde¬
that

of

the effective

ing

investment

lieves

objective

benefits

on

pension funds, and

pendent, professional investment advisors.

Pension

as large a return
possible, consistent with safety.
In pensions yield is of the highest
importance because of its effect

problems said to be found in the
of

Union

is

as

Administration, Columbia and New York Universities

investment

to

It must be remembered that risk

,

Policies

A second pitfall is what is

the market.

guess

Management.

management,
as
ments, is to earn

Adjunct Professor of Finance, Graduate Schools of Business

and

Portfolio

Appropriate

Research Dir., Twentieth Century Fund's Pension Fund Survey

administration

,

Investment

By PAUL L. HOWELL*

Financial consultant pierces

\

>

A.

common
stocks; through dollar
averaging without trying to out-

11

con-

Individual

ventional thinking, that the possibilities

of

future

inflation

Investment

Specifications

for

Security Purchases,

in

the

oil

business, you
might need to be familiar not only
with the oil industry, but with a

When
a
businessman
buys
a
piece of equipment whether it be
a
simple truck or a complex in-

number of companies in the field,
These companies vary from single
policy per se, which is to secure
charged with funding are, as follows
operations to integrated compadustrial
fund adminisplant,
he
has
certain nies, some of which have world
m Pav-as-vou-eo
Here there' as large a return as Possible retinfinn
^
yOU-gO. JriCre meie gardless of fhtrndpc which may engineering specifications in mind, wide
pnvr]lpCa
nf
wViioh
11 ailoii,
changes
connections.
What
about
Iiteu
lg po jun(j
oout

labor

agement

leaders,

The

chief

types

of

pension

have

effect

no

should

investment

on

mov

manage<

assistance. We
"Paul

jl.

Howell

to

need

em-

ohasize funda-

mental

principles

to

get

good

a

foundation for sound management.

initiation

The

.

of

involves

program

decisions.

tant

retirement

a

several

These

import

guidance and counsel.
the

to

as

The initial

nature

the

of

retirement program to be inaugu-

will

rated

be

decisive

in

deter-

mining -the amount and character
of

the .investment

Ihereatto. > "
There

•

:

about

the

which

(1) The

type

nreuffnim'

,0v

fh e

f

to

lunc.,

curities

of

meet

to

individual

definite

ment

specifications,
analysis; and,
Selection

(4)

adviser

of

se-

invest-

i.e., security
investment

an

qualified to

assist

in

the

handling of these problems.
We

decide

must

adviser

•

first what

specifications

for

hunt

the

then

are

whose

training,
perience
and
abilities
fit
funds' objectives.
one

ment

I.abor

Leader's

ex-

the

(4)

pension
The

delegation

The

Psychological

union executive
and

with

the

makes
tant.

him

oxnerience to

thermore,

in

be

ment in

the

process,

he often

talistic
or

and

invest

in

This

t^th"m

likewise delegated.
It is assumed tthaUin

as

merits of

type

pension

eacb

feels anti-capitrust

to

institu-

invested

the securities of the employing

in

corpora ion

.corporations

or

the stock of other

which

may

be

sub-

ject to collective bargaining work
stoppages? But pension investing
js
capitalistic in nature so the
old

order changes. Union leaders
t0 be approached through

*An
the

the

address

Tenth

by

Annual

Prof.

Howell

Conference

on

Institute for Labor Relations

cial

Sc-urity, New York

14,

1957.

before

Labor,
and

So-

University, June




S

a j%ea'
"

The union,

however, needs independent arm's
length
advice
on
whether
it
should
delegate
its
investment
function

try

to

whether

or

carry

under their own
often diff'cult to

on

is

It

steam.

they should

world political situations? In fact,
he many people spend their entire
hfe analyzing oil securities alone,

man-

job,

ffndWV?he
.

„

then

increased
The
lies in

yield

answer

objective?

a

to

these

and,

a

careful

and

analysis,

an aggressive, lrnaginadynamic investment policy

rents

in

the
the

fundamental
American

from union to union

vary

benefit

own

of

the

objectives

chief
as

are

(7) Freedom from

(

cur-

economy

dif-

and at¬

conflicts.

must

Selection

are

may

of

a

be some
portfolio

necessarily,

compromise.
mon

world?

for

The

the

desire

of

the

of

Private,

placement oj these securities.

funding
to

oF

This

announcement

appears

was

union

fool

for

a

client

B.

Investment

a

in

V,®iov"!'

J,lriAc

f+•

administered

other people
no

custodian,

as

investment

fund

the

with

s

money.

no

be

examinations
successful

problem
is

to

intense

phases.

Let

this

union

managers

t0

make

mont
,

a

problem
can

success

us

now

of record only.

Ogden Corporation
5% * Convertible Subordinated Sinking Fund Debentures

or

'o(

believe

^hat the

.fheir

it

V

men.

{unds

which

is

a

oAllen & Company

development.
I
absolutely necessary

new
is

unions

staff>

or

either appoint to

hire

as

personal

Consultants, exuerts ill the field
(q guide them. These experts may
^ d the WQrk themselves, but
.

Share

competent.
pro£es.
rt advice in the han.

union

relatively

Convertible into Common Stock at $20
per

train-

experience financial
need

sional
d,in

*

of their invest-

activities

Th6'

May 15,1972

to see how
be
helped

LabOT ieaders are not bv

jn£.

due

ex-

.

their counsel

.

is

needed to evaiu-

July 26, 1957

if

pass.

But

tc

.

Continued

"

presented in its broadest and most
amine

There

investment

a

management

which re\ professiona.

code of ethics, no supervision

$5,000,000

union

lawyer,

i8 ?

« true that there
i qui eel to manage

Funds

Assuming the decision has been
"go it alone5'"with a self-

Is

Character.

medical doctor, a

Investment Problems of Union

made to

equally

Management

Professional

fund.

Pension

holds

for the amateur investor.

NEW ISSUE

H

re-

investing ir
a
dynamic
legal maxim: s

old

negotiated by the undersigned.

as a matter

be

administration

the

in

tyoe

a

ac-

in

advice
interested in

the

It

dilettante hope

a

ret independent, impartial

of

law,

lawyer who represents himself has
a

a

from those who are
soling their servces. An ■ntant'ible, non-fmancial factor in the

technical

such

The

com-

purchases there is a
emphasis on value and
economic trends.

can

in

some

stock

need

involve
In the case of

company

through

successful

not all

geographical, industrial,
diversification; difficult, problem here is what is
balanced or split port- a realistic estimate qf the future
j'olio with a substantial portion in earnings capacity of the company.
and

How

be

securities

Like

harmonious—there

fundmental

through

tions.
to

follows:

specifications

as

engineering.

or

quires continuous and daily application
because
of
the
dynamic
character of the constantly changing markets and earnings situa-

as

investment

care

is

that of medicine,

as

counting,

(8) Taxation.
These

This is accom-

security

Investment
field

vary

tention.

questions

balancing and hedging of

plishedv, through

iunas

(5) Liquidity—marketability.
(6) Maturity—duration.

How much risk can be taken,
'

the

(1) Safety of principal.
(2) Certainty of income.
(3) Adequacy of return.
(4) Appreciation possibilities.

revolve around two
Questions: How to implement the
cies

pension

specifications

tunnies is un
.

of

Some

im?

,.

mind

fer.

The operating investment poll—

following

bank

be

pen-

their

which

companies

funding through

of

may

on

those

tive,

0f

funds

making

his

considerably from other funds and

costs,

beneficiaries 0f a rising

retirement objectives.

Fur-

manage-

tions called "Wall Street." Should
union

••

accomplish

jecuves

^V1.

to the relative thoroughgoing

sion consultants

hesi-

monied

••

»

and

reluctant

the

or

(bank) trustee, many of the investment management problems

educated.

collective bargaining

is

operating

f

are

active

train¬
unfamiliar

opposing

the

or

Aearch should be concentrated

com-

these funds

ha^e definitely in

fund's objectives and unique characteristics.
The
investment
ob-

wdl affect adversely the selling

awayf'™e£\estS
not be,set- Af I

training,

manaee

to

must;

investment management activities
wdl be
av°id those industries
where lowered purchasing power

problem

if it is decided to fuhd

stallarW

is, by

institutions.

distrustful

He must

investment

order for the union fund

ager

on

finding

,

organization,

by

Up

In

only effect of inflation

price

select?

administered

from union which may

the

experience,

iinancial

bank. The

a

we

of

to

panies

takes

manage-

insurance

management

selecting a financial adviser
the psychology of the labor leader
must be kept constantly in mind.

'

(union)
funds.

Tn

ing

to

Self

selection

Make-Up
'•

is delegated

problem is whom do

is
•

investment

Here

The

price level.

.

and its suitability for the union's

...

(3) Selection

piansf

have competent guidance by

wPu

oojeciives

'■

investment

take place in the

these decisions that the union will investment risks.

objectives

the

Here

problems are assumed by the insurance company,
(3) Corporate (bank)' trusteed

' '

funding-

of

vies appropriate

Vf

managers

make decisions:

must

<

problems

fund

Insurance of benefits.

'!; ; W?pSot

«

•

essentially four sets

are

financial investment

of

needed

advice

•

ap

decisions

vitally affect the nature and character'of the need for investment
decision

(2)

on page

35

The Commercial and
12

Financial Chronicle... Thursday, Au gust

(484)

lion

The Shoil-Teim Outlook and

1958

fiscal

to

Prospective Budget Developments

of

ume

to

basic

appraisal of

an

outlook

economic

over-all

Placing

positive Government
action interest rates would fall.

equivalent of

that without

Suggests Monetary

action

of

years-at least under the Ads
budget
pi oposals.

ministration

and to the im-

(I might note parenthetically 1 do

The

of

short-term

the

as we

choose

Exchequer exhcrts his

loans;

and

the

praises

industry

insurance

for

JhT
offices for th^ work

assurance

consideration in monetary policy.) day,

First,

British

equating investments to savings collected.

*

In a sense, risingr
be counted on to reach their opti- wbjch
they perform both in colpenditures
particularly redeia mal level ot economicmarket re- lectins savings and in channeling
in a free
changes in —may be regarded as taking ovc
gardless
conditio s, them* into productive use in inGovernment for this year and perhaps next the or that reduction in interest cost
dustry and elsewhere# Fifty years
expenditures role oi rising business investment to the Government is an inelevant g90 there was, just as there is totaxes.

the

popularity,

the question "how honest

that it is "as honest

answers

Chancellor

plications of
proposed

or

of

poses

problem of inflation and to accept the
depicts incongruity of those who urge
more
government spending and yet want inflation dealt with
more
effecti/ely; labels inflation, not deflation, as the real
danger; stresses banks' responsibility to limit themselves to

to

not believe that interest rates can

ahead

Treasurer

and Northern Ireland

remedies;

and the most likely and there would appear to be
continued support for more danger from deflationary
the economy over the next couple, than from inflationary pressures.

six

money"

our

it."

necessary

penditures at tins time probably
should be accompanied by Federal
Treasury

Exchequer

country to face the

moderate reduction in Federal ex¬

and

make

of

source

months

12

to

a

"honest

money?" and

our

to

circumstances,

these

Under

is

Ease

of the

Kingdom of Great Britain

significant,

the
over

next

the

Chancellor
United

demoralized, it is not at all clear

Reserve

are

By RT. HON. PETER THORNEYCROFT, M. P.*

in

refinancing

Treasury

these the upward trend in Gov- ease the money stringency since
eminent expenditures is tlie most such action is readily reversible

aspects of the
economic situation which

current

stimulate

to

prospect and the market for U. S.
Government bonds already rather

no

two

are

Money and :
Other Aspects of Inflation?

However, witxi a large vol¬

ment.

over-all significant changes in the next 6 to 12
months, author suggests that present conditions may warrant a
moderate cut in Federal spending, accompanied by Federal
Reserve and Treasury action to ease tight money. Professor
Friend proposes bench marks to correlate monetary and tax
policy with different economic outlook and budgetary reduc¬
tion situations, and holds tax reduction is a more powerful
anti-deflationary tool than monetary policy.

There

How Honest Is Our

market,
invest¬

easier, money

warrant

conditions

IRWIN FRIEND*

University of Pennsylvania

Anticipating

might make tne eco¬
sufficiently shaky

outlook

nomic

By PROFESSOR

reduction in
budgeted for

billion)

S5

to

Government outlays

1, 1957

claimant demand, for

a

new

The

truth

is

either

must

probclm

of
policies

the

continual

J of

in

its currency.

the

greatest

a n

Offers

pointed

loss of momentum

in the over-all economic situation,

,

of

prosperity
Irwin Friend
in our history.
Second, various economic indicato hesitation

Predictions

Utters
Looking ahead nor the next six
*° twelve month, there does not
spcm f° be much reason *°r anhcipahng any significant change

tors have in recent months
or

in the rate of advance in

substantial

more

d

longest period

.

cutbacks

th©

in

Federal budget.

Associates Investment

"Less

It

certainly

which

upon

the Sayis -ii'ot-Va

the

broad

a

economv

rest. :The

can

qualities of thrift
temperance have been the
foundation of our national wealth,

and

Debentures Offered

Today

Public
offering of $50,000,000
imply a bil- Associates Investment Co. 5V\ %
hon dollar increase a quarter in
deJbentures due Aug. 1, 1977 is bethc. late of Etdcial spending, and
.^g made today (Aug. 1) by an

Zip" Noted

—

men

asking

are

whether

these qualities still exist
Government
character.

stay?

in

and

bound

our

national

our

inflation

Has

Arc prices

at

or

—

rate exist sufficiently—in

any

would be far graver

a

the millions.

of

basis—it is

one

fiscal 1958 appeals to

activity.

jngs

—

must depend on

we

bad

The Administrations budget lor

business

—

-4-u

t

j

probably be associated only with day

to

come

to

g~>

on

if he failed

What is the

to do so.

Government's

May I

Chan-

a

forthright

only be that

can
..

...

.

.

business situation.

value

If it is ^aid that
in such

the

check

else it must face

or

decline

danger in

following

nation

to

necessarv

and curlail it
a

this

that

squarely
face
the
inflation and accept

in

part

all

this?

this about the Govern-

sav

ment and its expenditure?

Hardly

day passes without the Government being pressed to spend more

a

It is said-—by. high placed

money.

military
form

persons — that
defense
is to

of

forms

of

modern.

tore

that

all

and

expendi-

Universities

the

on

said

is

onlv

have

ancient

weapons

It

the

is

gro-

tesquely small. It is said *hat what

though
past f

months inventory invest-

w

and

ment

perhaps auto purchases
as well
Lven hiisinpss plant and
Even business ninnt nnH
equipment outlays,
one
of the
mainstays of the post World War
II boom, have been leveling off.
Moreover, a high proportion of
the economic scries which

are

rc-

garded by the National Bureau of
Economic Research

turning

earlier

business

dining
time.

over-all

activity have been devarying periods
of

struction

orders,

private

,

and

permits
(residential and non-residential),
average hours worked, new business incorporations, and wholesale
prices of basic commodities have
have

failures

National

prices

have

increased.

Of

Bureau, only stock
been at all buoyant

in'recent months.

While I do not

happen to believe in the predictive

value

of

called

lead

could

these

of

many

so-

have

for

indeed

time—the indication thev
they

some

give

series—which

been
interpreted as
recessionary tendencies

implying

of somewhat less zip

cicmc

nf

ranirt

rates
ides

however,

over
ovci

hii«inocc

ricu»

the
uie

in

mst
pasi

in

vear

yeai,

have reflected not

may

only such economic considerations
ri i

C

inx rncrm nnr

rl

higher investment demand and
liquidity but also the Psyetiological setting mduced by Fedas

lower

oral Reserve and Treasury
The

most

buoyancy

wV^!uiLic»
individuals

and

,

...

local

goods

1

received
by

the fourth

the

company

but will be initially applied tc
to
but will be initially

the

reduction of short-term notes

due

money?" And the
"A«? honest

as

sinking
sinking fund.
fund.
~-o

Sinking
Sinking fund
fund

are

to maturity by the
y the issue prior $3,333,000 principal
the
redemption of

,

Consequently, with the indicated
(offset in part by

a

of

amount

the

debentures

an-

expenditures nually.
corresponding

rb?e
government revenues) and
With no evidence of significant
changes elsewhere in the econpmy, it seems likely that the nab?SalKmcom®
^ "ext year
Wl11
Aa® .' %lgh <J*nd .Pr.obably
sonVrwhat higher than it

is

cur-

yently: On the otner hand there
I? ^.° indication of aggravated inLationary pressures.
When to

of

dealing

more

flatioii.

You

it

which

through its devoted and
voluntary action
represents' an
important instrument for securing

will

will follow
follow

creases

creases

niohf
folas night folNo economic or

day.

upon

-

ns

v.

governmental ma°ic.

system of

no

can ston that process. Bethose
price
increases
thus

fore

form

to

are

baris

the

another

round of wage inTjie company in 1956 had a total
creases, the country should ponincome of $117,439,000 and a net der the damage which could, be
income of $19;508,000, the latter .do"*4 in +Vis nation and to all who

Jn

addition

lts

to

0ffices

located

in

30

the

states,

District of Columbia and Canada,

|jle

underwrites

COmpany

lif^
life

anrt
and

engaged

in

work in it.

insurant
insurance

autoand
and

manufacturing

is
is

and

„

.

.

.

.

T

,

A" Solutions Are Unpopular

financing

operations conducted through 161

mohil«
mobile

Cut Taxes

controls

generated

for

equal after preferred dividends to
$5.93 per common share.

-that

be-

important

the

for

policy.

sources

economy

as

of
a

ti

tions of proposed changes
A
,

,

Government

and

purchases

services,

a

more

increase
in
consumption
personal disposable in-

in

,

„

the

in

,.

»

bv

Pro'esscr

Friend

before

Subcomon

Fiscal

Policy.




(Spocial to The Financial Ciikonicle)

to

be

cannot

at

the

same

than

year

did

we

soeech

Budget

In

last,

my

poinu
pointed to the
surplus of £468 m. and described
I

it
as
a
"striking
contribution
towards the strengthening, of our
balance of payments and the stawia.,
u->o
bility of the or>nnn^y." It would
economy.
ai
at that time have been easy and
bee
popular to give away more of this
surplus in response to those many
critics who were then so busily
engaged in pointing out the dangers not of inflation but of deflation. But I stood by my view that
inflation
rather
than
deflation
was
the real danger and I feel
sure
that
no
discerning person
would disagree with that judgUJcll

mar;

,-ctv^

ment today.

may be convenient if I conThe scale of public investment
jentrate on those aspects of infla- is of course high and will certaintion:which are by their nature of ly continue to be high. Steel and
Particular concern to the Govern- coal, transport and power, all
mont and to the Citv. I would
this

first

about

inflation.

say

It

is

basic

these

industries

perbaps the most intractable and

tities in years

problem

in

Other

face.

face

it

found

loo

a

which

and

none

have

we

countries

have

to

have

yet

satisfactory solution. Yet
woravw ,y owiuu.pi.
xvp

need

capicapi-

Thev will absorb large quan-

tal.

can

the

than

faster

ahead. But not

fields

these

which

resources

We shall of

available permit.

are

even

develop

we

give these iiiuuucuvc inproductive in —
billiOn Or $2 Pillion in presently
'
«
sivc
budgeted expenditures during fisLOS ANGELES, Calif.—George here in this island, dependent as dustries priority over advances in
c,al 1953 is not likely to chan§e f Muellerschoen has become affil- w are imon external trade and the Social Services. We cannot
economic

p0rtant

outlook

extent.

A

to

im-

any

substantially

jarger reduction—sav $5 billion or
m0re—might give rise to significant
deflationary pressures, ancl
probably should be associated with
_

some

'

_

reduction

in

tax

rates

and

with policies directed towards

lated with Eastman Dillon, Union
Securities & Co., 3115 Wilshire
Boulevard.
He
was
previously
...

...

^

.

.

with Merrill Lynch, Pierce, Fen
ner & Beane

reduction in
small

and

Joins Jamieson Staff

economic

tax

condi-

appreciably,
rates

calculated

any

should

to

O.^tewarnS^teen'added to^the
.

be

leave

a

modest cash surplus at the current
level of national income,

Russ

t}'

'

Jamieson Co., Inc.,
was formerly

Building.
.,s.s ^mknng. He
He

Wlbl banford & Co.
Wm.

R. Staats Adds

(Special to The Financial Chronicle)

SAN

even

a

moderate

($2

bil-

•

_

is

blaming
that

wa«e

Government
have

claims, profits,

other

part

cer-

answer

an

exoenditure,

and

their

We

■■

■

another. The

one

Bank
all

factors

to play.

All

the

Co., Ill Sutter Street.

course
cuuise

,

,

.

,

..

afford not to do so. E\ en so there
is limit to the speed at which
tated
.

We

develop.

can

have not

and wU1 not

we

hesi-

hesitate, to ad,

,

■

even t e m st es^e tial m-

-111

vestment

The

programs.

must be to

object

that these

secure

pro-

solutioris

al e unpopular. What is grams are matched by the savings

right,

I

as

have

observed

always popular.
atively

these fields
all

the

form

easy

moment

a

is

critics

is

not

And it is a relof

solution
even

escapism,
in

one

of

hinted at for

condemn it and

to

FRANCISCO, Calif.—Chas.

been added to
bnvate investment demand level- the staff of William R. Staats &
oft,

.

to it ill

the

merit further consideration. With E. Condoii, Jr., has
ing

to meet this problem.
tainly sbaall not find

advances
(Special to The Financial Chronicle)

money market con-

Unless

with the responsibility of a world
banker, we needs must find a way

truih

eas-

inn of current

(i.e., a rise in individuals'
The implications for monetary
propensity to consume) and a rise and tax policy of proposed re¬
in
net
foreign
investment.
Of duetions in Federal expenditures
♦statement

Joins Eastman Dillon

d>1

ought

effectively with in-

to

budget, a 1 eduction of $1

uiiiim

we

it.'

.

designed to retire 93.324%

may

is

to

answer

anv

f
.
of tnese sectors.!
oi thege sectors

aovprn^nt

-o-

it

choose to make

we

within

the

come

mittee

capital of

wor]cing

be

Investment,

.

fr0' Z cXnsltStion "in

tions deteriorate

than

propensity

,

»

.

,

ditions.

rapid

,

debentures

^on.sulIie' expecting much change payments begin Aug. 1, 1963 and lows
but tbei^ 1S "° stro"g
basis lor

the increases in Federal and State

of

Associates

to

the

of

nV

whole in recent months have been

and

proceeds
sale

other business.

also have

nC

ndvmppri

l

terest
leresx

our

one year.
—— *
^ a nation pays itself 7%
The debentures are not redeem- more for doing no more work, as
"n- able P.cd3t through^ operation- of happened Jast vear, price into

....

ignored.

markets

money
chfiuHntf

u/ith

evidence available for aprerfi-

V™\s}n* the t likely frend • in
f
]

in the

showing signs of ovtromo
extreme
tightness frequently associated
been

.

i

Net

difficult

economy cannot be

The

expenditures on plant andi here is
equip-

ment during this period,
,
•y
s
&
Tiui

downward, while busi¬

the key "lead" series employed by
the

from

t0

iv,

all tended
ness

ing suiveys ot business plans t<
•nvest, actual capital appidpiia-

con-

,

contracts

crued interest,

leading (i.e.,

than)

lor
New

,

as

investment in plant and equipment
?vei
next year or so includ-

♦Frcm

a

talk

bv

Chancellor
.

Uiiicu,

Juiy

10,

1957.

.

Th-mey«.

available
so

as

to

on

the

facts

our

the

profits

of

facts

life.

which

partners

earned,

less heavy bur-

a

the community.

den

same

or

place

in

These

They
face

the

are

many

are

the

of

Common-

Wealth today. We should be faillng ,n our dutyl° the Common,

..

wealth

and

.

to the

L

^

whole world if

Volume 186

did

we

Number 5660

them

not face

United

The Commercial and Financial Chronicle

...

in the

here

Lastly

Our

times I

urged to end the credit

am

Sometimes I
to

the

told

am

Banks

the second

the

choke

banks

back

there will be another round of increases in borrowing
rates.

By JOHN T. CHIPPENDALE, JR.
The

want

to

agents

to

course

their

as

production

raise

and

doubt

I

courses.

refunding operation with

an attrition of $1.1 billion, or
publicly-held issues, means the Treasury will
have to raise new money in the near future,
probably next month/
Although the certificates went very well in the exchange offer,
there was a good response to the 4 year-2 year note, and this
might eventually result in an extension of the maturity date of

about

12%

of the

tne Government

unemployment. Oddly enough, the
same people sometimes urge both
these

Governments

to*

their

on

liquidity ratios in order to inten¬
sify it. I wonder if those who ad¬
vocate

on

to credit policy. Some¬

as

squeeze.

dictate

Reporter

their wis¬

NSTA

Short-Term Securities in Demand

Nevertheless, credit policy
important part to play.
Obviously we need to learn all we
can about
techniques in this field.*

We

The Government market is

again rather distinctly divided into
sections, with the short-term area continuing to get the bulk of the
attention. This means that there is a strong demand for the nearterm liquid obligations which results in a broad and active market

an

We

look forward

all

to

find-/

the

for
too

ings of Lord Radcliffe's Commit-tee.

But

of

Committee

the

course

was

Radcliffe,

intended

never

techniques

restriction; clearly

play

tion. On
not

has

the other

deceiyo

complete

vances.

musty
im-

my mouest to the Banks

Anril

for

securities is still

able

the months

to

P'M'baos r

tunity

of

come

poftence whkh

the

again

wo''k.

In

te

and

their

in

rvwtte"1"**

long-term

Treasury

small and,
to

as a result, price movements in
mainly professional. -Because of the

be

more

the

meet

move

r

favorable vietes avail¬

and local Government

Hurry

take

few

a

the back

In

of

existing competition, Government bonds will

weeks before the

sboul'l

f'Vr

SO

orations, designed to.provide
ital

for

chqrt

apnropriate

periods

until

long-term

ments for finance

op-

Tbo

cap¬

issues which

new

came

arrange¬

Tf this

it.

slower

a

jc

a

It

i«

unmatched

bettte- lost
my

rowing*

teat

hv

against

inflation.

difficult. as

should be
real. shortage

the

demonstrates

a

long

wav

p

& Co. in 1902.

•'

a

cut their Budget*5 in

with

this

and

taken

these

facts

-

means-a

course

adeouate

inflation.

faetors

excuse,

ter

organization
line -in

see

ines

is

is .not

ignoring

right in the front

this endeavor.

oi

it,

is

to

prudent

vo..r task,

collect

the

people

sav-

to

and

match them to investment.

With

are

B"t the

those that I hav'e mentioned. Your

I

sizable

was

ment

the

of

He

was

Let

us

the

refunding

"

:

i

.

With Keller Brothers Sees.
(Special r,o The Financial Chronicle)

BOSTON, Mass.—Leo W. Kritsick is now with Keller Brothers

1939.

Securities

Co.,

Inc.,

Zero

Iowa —Paul G.
Boettcher and

DAVENPORT,

Vieth,
,->*
7
5r

with

He was previously with
Duncan & Wood.

Joins

Joins C. H. Reiter Co.
(Special to The Financial Chronicle)

CINCINNATI, Ohio—Arthur J.
Ibold is now connected \Yith

Bishop-Wells

\

Reiter

&

Fifth

Co.,

over,

:

SECURITIES
of the

INSTRUMENTALITIES

the money

to 4%: in order to put over the very large refunding seems
to bear this out. This indicates that the demand for money is just
sizable

on

as

ever,

new

'

25

L. A. Caunter Adds

years

or

Ohio—Theodore

with corporations, states and local Governments

to date.

Co., Park

Building.

With Paine, Webber

Webber,

Jackson

to get funds.

&

is going to be large, and
there are no indications of a change yet, (even though there may
be a minor new financing lull in August), there will be no de¬
in

interest rates.

of

As

a

matter

Curtis,
was

626
for¬

merly vyith J. Henry Helser & Co.




of opinion,

there

are

"COOP" —Bark for Cooperatives

Our

go

ancl

rew
a

booklet

summary

containing the highlights

of the salient features ol the

above securities is available

on

request.

jiot a

market specialists who are of the opinion that the cost

bdrrowing will

higher.

Wm. E. Pollock 8c Co., inc.

'i

20

Further Rise in Bank Rates Indicated

with Paine,

He

—Federal Land Banks

so.

Calif.—Robert

Spring Street.

"FLR"

This has lifted the

As long as the demand for money

few money

(Special tu The Financial Chronicle)

now

Federal Home Loan Banks

—Federal Intermediate Credit Banks

has

crease

McLaughlin is

a surge

bond issues to the highest level reached in the last

This increased bond financing bv the aforementioned borrow¬
more than offset the decrease in new mortgage borrowings

ers

staff of L. A. Caunter &

ANGELES,

-

"FIC"

Interest Rate to Remain at High Level

P. Patterson has been added to the

LOS

"FHLB"

"FNMA" —Federal National Mortgage Association

fCinofio? !;j "]>fr FINANCIAL CHRONICtE)

CLEVELAND,

GOVERNMENT

market and the fact that the Treasury had

to go

yield
< < i

FEDERAL

what is

coming into the market in
.

of the

the Treasury is apparently o"t of

going to take place in the meantime. Some new moneyraising by the Treasury seems to be expected soon. On the other
hand, there is no evidence yet of any let-up in the pressure that

The

idea

that

interest

rates

will

continue

to

advance,

bank rate.

PINE STREET.

NEW

YORK 5,

N. Y.

espe¬

cially as far as long-term financing is concerned, raises the ques¬
tion- as, to what -will happen to the discount rate and the prime
Also, the inflationary pressure shows no signs of abat-

C.;H.

Third* Bank

BOSTON, Mass. — Granville B.
Building, members of the Cincin¬
Colyar is now affiliated with Bis¬
hop-Wells Co., 185 Devonshire St.* nati Stock Exchange.

:vv-r

money market for a little while. The next refunding will be
the latter part of the year, when the recently offered 3%s will
have to be taken care of, and this brings up the question as to

on

Court

Street.

the

has been

previ¬

•

associated until his retire¬

in

With Boettcher & Co.

auite

type
reported that positions which

?,ri

as

South

Milk Street, mem¬

Exchanges.

very

gle that lies ahead.

V.

Vice-President

a

Chase Securities Corp., with which
he

position in Treasury certificates.

Because of this, it is

wish each other well in the strug¬

,

became

issue

an¬

I know:' that there

existence of other

as

31

bers of the New York and Boston

Treasury May Need New Funds Shortly

other factors in

an

Company,

ously with Richard J. Buck & Co.

this security by dealers' and traders have been
well. There are indications that funds are being
savings accounts in both the commercial and savings
banks ancl this money is being reinvested in the 4% due Aug. 1,
1961, optional retirement Aug. 1, 1959. Pension funds, according to
advices, are still making commitments in the 4% note, with indications that the bulk of-these-purchases are now coming from the

other.
Of

asso¬

Estabrook & Co., and Equi¬
table Trust Company. In 1930 he

taken out of

ac¬

one

on

later

was

BOSTON, Mass.—Harry C. Fac¬
now with du Pont, Homsey &

tor is

Stock

for it.

community and themsclvg^. ijt they Tpublic ones.' '*••••
impress'

He

Pont/Homsey •

(Spscial to The Financial Chronicle)

'

in

moving out

the national cloth.

and.ratepayers will assist the

away

(Special to The Financial Chronicle'

The 4 year-2 year 4%> note was, and still is. appealing to
few investors that are interested in the sayings (account)

were

Directors and.shareholders, honk¬
ers

Now With du

passed

pany,

sure,

of investment.

"

...

ciated with Emanuel Parker Com¬

Optional 4% Note Issue in Marked Demand

rt vate'qtersons

too must

cordance

be

Eddy

will continue to be the usual balance in the Central Banks port-'

af¬

locaV^ttJbocities,

pub!ic boardsrgpd

desirable

b

r

Company.

of

prefer that we should
firrt and other
considerations including anv in¬

Businesses,

a

'

business with N. W. Halsey

ment

Martens ' is

folios

money

dividual popularity

be

H.

the only obligation which the Federal Reserve
Banks have used in recent years to influence the nrmnev market

be

necessary.. I

put honest

to

annpfir=

Advertising Committee

July 23 at the age of 77. Mr. Eddy
began his. career in the invest¬

buyers of Government obligations and among the most

should he need

To

Supplement

all appreciate his support.

we

-

as

to

Chronicle," and

William H. Eddy
William

Treasury bills and there are no indications of any change
being made in this policy*.: Nonetheless it is believe-' tbrt there

.«"wmgs

of .money

"Financial

has been

in¬

intention that the bor¬

resources

ter.

-

f

be

nace. so

For the-fact remains

vestment

there

te«?<? investment or

means

1 iSwi

'

into

Certificate Well-Regarded

4%

certificate

4%

•

New York 5, N. Y.

important takers of this security was the Federal Reserve Banks.
An issue of this kind Is very much to the liking of the Central
Banks, since they always want to have on hand a sizable amount
of short Government maturities for market control purposes if

Places Honest Money First

investment at

one-vear

for certain

more

be made.

can

One-Year

New

possible

no

JP

c/o Fitzgerald & Company

affair because of the uncertainty which .-overhangs it.
ruiu .tiic
very large turn-in for the four months 3%% certificate
and the one-vear 4s in the recent refunding operation, appears to
bo proof nrritive of the desire to acquire in large amounts only the
mort liquid Treasury tesues. This applies to ail types of investors,
including the Central Banks.

the. nrmcinle

Allied

of the Annual Convention Year-Book

40 Wall Street

maturity

.

:

Alfred F. Tisch, Chairman

being with this exchange offer will be more thoroughly digested.
There is no question but what the money market is a very short-

da^-to-dav

bo Umitcte TO <3ho''t "b»'idein<r"

the

cover

down to lower levels.

more

o

•»*.

bonds, long-term

that overdraft f»cilit;«s for mruto}
PUi-nocnq

Zetrncut,

u..

market is still being dominated by the very large
refunding operation of the Treasury and it is likely that it will

im-

being

} "JJ

-

The money

I atterti to limit¬

started

out

'$k

had

Liquidity Still Dominant Theme of Investors

ment. The gu'dnnre vdn'eh ! have
issued to lhc Capital tem^s Com-

sWl

very

continue

corporate, state

to

in

qumit.it'os of Bank monev
available
for
long-term
invest¬

mittoe

not

National

ing the

carried

in

have to

closely.

very

bonds

order

take tlite oppor¬

may

stating

have

Treasury obligations do not have attraction yet for investors.

in Anvil

and

watch the position

to

securities

this group.-The

in

upward trend in interest rates and the

May
have
shown
a
less
disturbing
trend, though I shall be bound to
continue

intermediate-term

demand, but the new issue, the 4% note, due in four
but redeemable in two years, has added somewhat to the

these

markfed'v

a

in'the level of Bank ad¬
I am glad to sav that since

figures

The

The demand for and interest in the most distant Government

February

was

Harry L. Zeeman, Jr., of Carl
Inc., has again contracted for a half page space on

Long Treasuries Continue at Competitive Disadvantage

*

be^a-

over

In

answer.

and «'Ma'rch There
upsurge

we

that

can

Co.

*

hand

ourselves

proved 1 techniques

the

to

part

a

issues.*

activity for obligations

our,struggle against infla¬

m

pleased to report that

are

&

bonds have been moving down towards the lows for the year, oven
though this trend has
been
interspersed here and there with
rallies.
-7.*,'
% < X."'
V"f. •, V

develop, credit

we may

Marks

much

years

as

substitute for action. Whatever

a

these

Notes

debt.

dom.

has

13

ing and, as long as this is the case, there will be po change in the
tight money policy of the powers that be. Until there is- some
worsening in the business picture, the chances are rather good that

Kingdom.

Limits Bank Loans to Short Terms

use

(485)

9643 SANTA

MONICA

BLVD.. BEVERLY

HILLS, CAL.

Commercial and Financial Chronicle

The
14

1957

1,

to them that they can¬

System

not

anything, but can only

quirements)

probable, it is more im¬
portant than ever that commercial
bankers speak plainly and bluntly,

them

competition—a

of

fear

logical

appearing "to have a patho¬
kind of 'competophobiaV'
(1)

depicts:

member

Board

Reserve

the

Banks should

tion and better

which

ber

which

banking's future lies not in successful defense of its

tends

banking
six

with

consistent

services

developing

our

Allan

Sproul, then President of the Fed¬

so

long as it continues to serve the

ago

years

of New York,
of the really great men in

Reserve Bank

and

one

Federal

Re¬

history,
spoke
in
St.
serve

Louis

the.

at

Gold

en

public adequately and fairly; and

long as bankers take the
position of trustees, rather

only
high

so

than

the

and

Convention of

^ood

National

the

Association

of

chose

He

t i 11

the
h i

jpf

"Who
Vardaman, Jr.

address

for

e

Speaks

Banking?".

As

u s u a

was

found

as

remarks

s

for
K.

Banks.

a

1, it
pro¬

challenging and
thought-provoking. One thing he
said which particularly interested
me
was, to quote, "On the great
—

issues of the times in the field of

monetary and banking affairs, the
banking community as a whole or
at least in any organized

know that

should

we

for the public in
.

like

should

we

it

not,

that

remember

or

the

ing should
thoughtful,

.

clearer voice than
1951.

This

is

respect to

it had

prior to

certainly true

some

with

of the major

nomic questions of

eco¬

day. Bank¬
ing, as a whole, has given strong
and
well-reasoned
support
to
our

sound monetary policies. However,
in those areas more
directly re ¬

lated
ties

to

daily operational

activi¬

of

banking its voice has at
times been confused, selfish, and
unbecoming, especially in relation
to

competition

between

indepen¬
banks, and
between commercial banking and
dent banks and branch

other
as

financial

institutions

such

savings and loan associations.
Fear

Bankers

of

to stop

as

a

group

or

in

cention assembled often
appear to
have a pathological fear of com¬

petition — a kind of "competophobia." When such questions de¬
velop and are discussed, either

privately or publicly, the voice of
banking becomes strained,
un¬
natural, and unconvincing. It is
then

Examining

that

we

Leaders

hurt

ourselves

believe

nance

financial

and

institutions by alienating sup¬
port from the public and in the
halls of Congress.
as

bankers
should

as

institutions,
and
individual
citizens,

know

what
the
public
requires; and should be
first to recognize these require¬
ments and govern themselves ac¬
cordingly.
wants and

We,

bankers, are literally
trustees of private enterprise, for
without private banks there can
be no private free-market system
in, this

as

country.

*An address

Private

banking

by Mr. Vardaman, Jr. be¬

fore the 66th Illinois Bankers

St.

Louis, Mo.




this

in

„

the

and

which

have

various

f inane i

Association,

the

a

Congress

would

the

welcome

and

help

of

positors
of

can

embarrassment

place

amount of

to

funds,

re¬

know, is dele¬

we

as

subject

eral* Reserve

We

System.

must

always be,

sacred

a

respon¬

seriously by the Congress.
Competitive Picture

We

hatfe

variety
financial

must

that

thing

deposits held only in
banks.

There

the

to

among

Thus,

we

organizations
commercial banks

from

social

security trust funds;
from life insurance companies to
mutual

institutions.

called.

funds.

institutions

While

all

of

these

have

increased

World

mistake

variety and rela¬
liquid assets

such

of

greatly

Second
a

War.

them

with

be

impor¬

to

equate

thereby

and

money,

the

the

but it would

mistake

greater

a

the

overlook

to

since
would

It

tance of.these funds;
be

special

place

of

of

the

growing

The

Federal

Reserve

carries out its mandate to

ings

amount

commercial

of

deposits,

or

through

its

ume

of

cific

tools

control

bank

Reserve

bank

all know,

as we

the vol¬

over

The

reserves.

spe¬

through which Federal

policy

is effectuated

are

potential growth factor? The
unsoundness of such an'approach

is obvious.

When

couraging practices which,
unsound

time

over

in

in

themselves
to

unsound

individual

refer

to

if not

tion

conditions

If

intense

They
competition
commercial

going on among
banks, savings banks, and savings

now

and

loan

which

areas

in

associations

upward

has

in

certain

itself

expressed

adjustments

in

the

Also,

observers

some

effectiveness

of

appear

adequacy and

present

tools

of

monetary
management.
Others,
impressed by the fact of a faster
growth of other financial institu¬
tions

than

seem

of

commercial

concerned about the

run

competitive

the

various

make

up

relations

financial

they believe that
of

banks,
longeramong

organizations

the

our

which
system;

mechanism

monetary policy requires

com¬

mercial banks to carry more than
■
u
7 lly
f 1
share of the burden of

SST
then fair

,

,

maintaining stability in the

econ¬

omy.

seems

are

to

concerned about

them to be

an

un¬

desirable concentration of control

interested

in

securities

Federal

institutions

ratios

reserve

Extreme

This

primarily

that

create

Reserve

these

seems

instruments

assets
competitive
with
deposits—and perhaps to a
lesser
extent with, demand
de¬

to

time

re¬

posits—we

member

to be that

sufficient

are

achieve

bank

of

Demands

consensus

liquid

can limit our attention
mainly to mutual savings banks,
savings and loan associations, and
we are con-

permit the Federal Reserve to
its objectives in regulat¬

ing

volume

the

credit

money

sup¬

few

years

with

active

an

anti-

monetary policy has

cyclical

financial institutions

tinue

monetary
should con¬

the

Our experience over the past

inforced

on

and

commercial

of

ply.

cerned with the effect of nonbank

that opinion.
be

to

There

thoughtful

re¬
con¬

to

it is

only good gov¬
if

And

them.

remove

applicable to other
do
not
adequately

institutions

protect the public interest, it is
good government to apply

only

additional

is

This

ones.

the

ap¬

proach which bankers should take
trustees and leaders of the peo¬

financial matters. In this
should speak for
the public.
Although this approach is simin

bankers

way,

pie in concept, of course it is not
simple in application. For it re¬

quires that we examine the role
in

the

other
the

economy

financial

of

banks

institutions,

environment in which

we

and
and
ex¬

them to operate in the fu¬
ture, and then ask what regula¬
tions would make good economic

pect

sense

students

and be

good public policy.

Obligations Involved

of finance, however, who believe
In order to do this, we ought
mainly on that the Government should exer¬
cise a more rigid control over the to consider how the obligations of
these same organizations.
In considering the competitive money supply by requiring 100% the various financial institutions
fit into the structure of financial
among
commercial reserves against demand deposits.
relationship
banks and
between
such
banks
Certainly, I do not approve any assets existing in the economy.
and
it
and
other
financial
probably We ought to examine the relation¬
institutions, such extreme
we
must
always keep in mind would not appeal to many; but, ship between the type of liabili¬
that
each
institution
is
that the commercial banks are in on the other hand, we should all ties
be disturbed by the prospect of pledged to meet and the type of
some respects unique. They create
asssets that it holds.
Do we find
demand deposits, and this enables an opposite extreme as indicated
proper
balance
between, the
the commercial banking system as in recent speeches and conversa¬ a
which
a
whole to have an effect upon tions
suggest
that some structure of liabilities and the

policy,

we

centrate

the

economy

tutions
as

probably

our

was

attention

that

no

other insti-

can have. For this reason,
discovered early in the

history of banking, it is
ject

commercial

to

special

supervision, and
itations

not

banks

necessary

be

sub¬

regulations

and

to

operational lim¬
for other

necessary

over

banking facilities in some financial institutions.
We
through the proliferation of
all
understand this when
branches, the extension of chains we take time to think it through.
and groups, mergers, or other sim¬
Sometimes, however, bankers tend
areas

ilar arrangements.
If these and other similar
ques-

Government

banks.

or

consideration.

are

those

for

Still others

what

in

we

quired

relevant to the ques¬

are

under

dif¬

deposits, win-- credit unions. Also, if

dressing around statement
dates, longer banking hours, and
flamboyant advertising.
concerned about the

ferences

lead

may

institutions.

the

we

S.

changes

are

not

the regulations

ple

en¬

U.

banks

regulations

any

then

ernment

by occasional variations in the

be

may

evaluating their importance,
must continually ask ourselves

in
and

commercial

to

required to protect the public in¬
terest,

which of their similarities

organizations

com¬

principle should be that

If

subject

such

loan

govern

public interest must be pro¬

tected.

panies, but they do express some
feeling that competition among

or

the
applicable

should

regulations

different financial institutions?

as

banks

then,

and

laws

Bank discount rates, supplemented

about the soundness

concern

individual

equalize

to

their

In

any

of

market operations

open

effort

an

or
commercial

from

some

in

banks,

associations,

loan

and

remove

the

System
regulate

we ap¬

ply additional regulations to sav¬

The basic

credit

in

than

rapidly

more

commercial banks, should

to

country.

Central Banking's Role

the

inequity

definitely

present tax provisions.
,
If savings and loan associations

primarily

from

is

There

something
in
common, they are in most respects
very different from one another.

These proposals do not stem

com¬

in these competitive efforts.

cess

are

amount

have

or

they

as-

are

some

money,

tive

existence

and the

in

are

commercial

in

are

types of liquid assets that
some
respects similar to

certain

govern¬

with

deal

ranging

and

institutions,

banks

commercial

petitive with some other

growing

intermediaries

sometimes

are

at the

private

of

financial

>

how¬

said,

been

must also recognize that

we

ever,

has

financial
commercial
bankers should
keep in mind is institutions, particularly in their
this unique power—and the re¬ function of holding savings and
sponsibility that goes with it— time deposits, and in providing
to
create
money
through
the other financial services. The laws
medium of demand deposits. The —especially tax laws—applying to
great bulk of our money supply other types of institutions affect
—about 80%—consists of demand to some extent their relative suc-

ture

and

great

a

this

When

the

One

and, therefore, of commer¬
cial banks, in the financial struc¬

Financial

Any

not

does

will not be considered

and

sound

must

sibility.

which

the volume

liabilities.

recog¬
this basic fact is simply not

gated by the Congress to the Fed¬

frankly recognize that this is. and

Governmental

special

to

action that influences

proposal

of

type

public interest—they must be

the

total

volume

Com¬

special

a

financial organization, and—in

of

nize

the

over

are

of their assets and

reserves.

Control

banks

mercial

such

the

affect

not

do

another,

to

com¬

of the

part

a

sustained.

be

cannot

try,

by shifting their deposits

one

serve

de¬

funds

cause

bankers

While

are

monetary mechanism of the coun-

alter the distribution
among
banks,

can

reserve

and

de-

banks

that

fact

the

ignores

mercial

limits

the

funds.

that

we

create

can

within

reserve

discount

Institutions

relationships
J.

coun¬

be confi¬

may

Banking and Other

United

developed

its

it,

money

good

a

We

the

bankers.

mental

careful look

structure

States,

is

that

seek

Banking-

that

a

only after
considera¬

prefer to approach financial legis¬
lation in this way and that it will

way

government and fi¬

time to take

our

Banks

in

a

dent

opposition but by constructive and

dow
con-

of

respect to bank¬

be made
judicious

whole.

try as

this erosion is not by static

rates paid for time

Competition

landmarks

of what is best for the

tion

erosion in the field of commercial

banking has been heavy. The

the law with

of

public will be served largely to its
own liking, either by our present
system or some other system of
financial institutions. Already the

.

position in resistance to change."
; Since
Mr.
Sproul's
talk
and
probably due in pari to it, bank¬
ing has spoken with a somewhat

provide

the

,

.

,

then, in combating flaws in
.

important

preceded

true statesmanship m conduct of

■-

,

we

of

shifts

have

ings and loan associations, credit
unions, life insurance companies,

commercial

the

system

deposits,

from

changes

the long-

..

capacity,

such programs
.,
it has allowed
itself to be cast in the role of oo-

our

not devel¬

legislative process. This was
In this capacity we must not be
true of the National Banking Act,
satisfied
simply
to
defend
oui
^le Federal Reserve Act, and the
entrenched position; but must take
Banking Act of 1935, which pro¬
the leadership in suggesting such
vide the statutory basis for most
changes in laws and regulations
of our present arrangements. Cer¬
as wni permit our banks to serve
tainly, this long tradition should
the public to the public's satisfac¬
be maintained, and modifications
tion. Whether
,,

progressive
action,
which
will
usually has taken a negative or give the public facilities in the
neutral attitude. It has left it to
form of banking offices and bank¬
others to propose broad legislative
ing
services
which
the-(public
programs and to devise changes in
requires,
'
;
T
our
banking and credit system.
And

remem¬

banks play in

remember

mand

capriciously.
No
field of
legislation has been more

which

what is

is actually best for us.

run
,

Supervisors of
State

low

position of money
changers. Our behavior must be
tempered
by a high degree of
public spirit and public service;

Anniversary

the role that
must

carefully thought out and less af¬
fected
by
narrow
partisanship
than banking law.
Perhaps be¬
cause
the power "to coin monev
and
regulate the value thereof'*
is
a
constitutional responsibility
of the Congress, it has approached
legislation in this field with great
and
the
deliberations
caution,

institution will survive only

applied to
as savings banks, sav¬

pension funds, and perhaps others.
Any approach that pretends that
there
are
no
significant differ¬
But when we think in terms of ences between commercial banks
the total financial structure and and other financial institutions, or

body of law

was

be

regulatory

Demand-Deposit Creation

Federal

an

eral

the

provides the basis for

oped

economy.

as

About

present

financial structure

position, but rather in its willingness to provide

established

the

that

re¬

reduce its

to

suggestion

similar

that

earning assets.

banking

First, it is important to

loses

bank

has

and

funds

serve

No Capricious Legislation

industry, Mr. Vardaman concludes, instead of pursuing narrow
or selfish measures
against other financial institutions. Con¬

their

withdrawn

transitory in nature.

are

extend, since when deposits are

is made
policies
such other

The

tutions.

institutions

needs

on

if their depositors

as

should

interests of
institutions,

competitive

looks to
control

It

depositors.

them also to other

to

public—which

financial

various

their

brought in

funds

reserve

the amount of credit they are able

focus

we

basic

the

by

interest.

serve—rather than

all

narrow

and

the legitimate demands of commerce

serve

the

on

and demands of the
we

sound, constructive legisla¬

encourage

attention

our

responsibility;
(2) growing concern for a thorough monetary-banking study;
(3) competitive varieties of banking and non-banking financial
institutions; and (4) rise of such extreme demands as 100%

create

use

with clear evidence of under¬

but

demand—deposit creation and its concomitant

reserves.

changes

standing of the public
This is possible only if

of

uniqueness

carefully examined

to be

appears

Reserve System

of Governors, Federal

picturing bankers as often

After

major

VARDAMAN, JR.*

By JAMES K.

Member, Board

are

and

Speaks for the Public?"

"Who

(particularly reserve re¬
without applying
financial insti¬

it appears

in
present
laws governing financial institu¬
tions are to be considered, as now

tions

J.

Thursday, August

...

(483)

to think in terms of the

of their

own

operation

separate banks, and

people have lost sight of the re¬
sponsibilities that commercial
banks have to the public.
Thev
seem

to

banks

right to

that

feel

should
grow

have
as

an

assured

fact as other fi¬

nancial institutions.
laws and

commercial

The fact that

regulation prevent them

structure

erations

assets?

of

of

any

Are

institutions unsound in
and

hence

stability?
the

a

various

making

threat

What

to

op¬

some sense

to

economic

contribution

financial

the

the

class of financial

are

institutions

efficiency

of

our

mechanism for mobilizing and al¬

doing so constitutes, in their locating credit? Do they facilitate
opinion, unfair discrimination. It or hamper this all important func¬
even
been contended that it tion? Are they meeting all of *the
is
discriminatory
to
apply
to needs that they could meet? Is
banks the
special measures ad¬ each type of institution suited to

from

has

ministered by the Federal Reserve

the type

of role that it is playing?

Volume 186

At

what

Number 5660

points,

structure

of

is

law5

our

not

are

they

misguided?

or

questions, but

ea^y

the

are

that

existing
regulation

and

deficient, excessive
The^e

kinds

of

should

bankers

.The Commercial and Financial Chronicle

..

be

question

asking—
and answering—from the
public's
viewpoint as well as their own.
Financial mstitutions should not
behave in such a way as to cause
contribute

or

to

economic

in¬

stability. As one aspect of this,
they should be managed on sound
business

principles

and

be

not

exposed

to failure or undue risk
of failure. At the same
time, how¬
ever,
the useful services of all
financial institutions should
not
be limited to

dealings in the high¬
credit risks,
but de¬

est

grade
velopment

of

institutions

some

contributing funds
relatively
risky

to

and

new

undertakings
should be encouraged. They should
be

allowed

to

adapt

changes both in the

flexibly

nature

is

continuous

a

process.
l.anaicaps

.and
healthful
Unreasonable
statutory
and
obstacles
to the

pot lie in the successful defense of

terest.

No

its established position, but rather
in its willingness to meet the re¬

taking

carries

degree

provision of adequate commercial

quirements

banking facilities for public
will be resented; and if

serv¬

people and industries which it has

must

com¬

been chartered

row

ice

mercial

banks

allowed

not

are

to

and

In most of

demands

our

serve.

communities the

provide the needed services, in the

banker sets

esty, integrity, foresight, and

conveniently located of¬
fices,
and
a
wide
variety
of
deposit, loan and trust facilities,
our
customers are likely to drift
Apparently

ready done
In

a

lenge
less

more

of

that

have

al¬

banking

with

economy,

little

some

so.

providing

consistent

ing

institutions

other

to

away

will.

services

ever

develop¬
well do

our

bankers

can

living with the chal¬

future

the

and

little

a

living with their competitive

harassments

of

the

future of commercial

The

past.

banking does

dence

for

community.

the

standard

the

this

hon¬

of

other

of

not
or

be

E. M. Shafto Y.-P. of

same

prompted

by

concern

a

for

Geo. B. Gibbons & Co.

nar¬

Geo. B.
Gibbons
& Company,
Inc., 20 Pine Street, New York
City, announce that Ellsworth M.

banks

against other financial institu¬
tions; but by a sincere desire to
as

encourage

legislation

of

under¬

the

it

responsibility.
commercial banking

selfish

pru¬

position

private

with

public

The voice of

business

entire

In

tne

of

primarily to

form

of

sound,
—

Shafto

constructive

which

will

commercial banks to

Shafto

been

elected

formerly
Lyons & Shafto.

better

serve

has

a

policies

leadership,

bankers, both as in¬ the legitimate demands of com¬
and through their asso¬ merce and
industry.
ciations, must think through very
If the banking fraternity is to
carefully the needs of the country keep its position of
leadership, it

was

an

dividuals

and

of

their

communities

and

support
those
changes
in
the
financial structure and its legis¬
lative
the

base

which

will

best

serve

public.

It cannot be reiterated too often

must thus

fairly, frankly and objectively.

grove

CHICAGO, 111.

Fothbem is engaging

ties

association

North Sheridan

public

in¬

m

securi¬

a

Miller, 81
members

South Euclid

the Pacific
Exchange. Mr. Boxley has recently been with Hemp¬
Coast

Sigmund

—

&

Avenue,

Sigmund Rothbein Opens

that commercial banking is unique
the

(Special to The Financial Chronicle)

PASADENA, Calif.—Chester W.
Boxley has rejoined Jones, Cos-

speak for the public—•

among all private businesses in its

with

Rejoins Jones, Cosgrove

of

Stock

hill, Noyes & Co. Prior thereto he
was Newport Beach
manager for

business from offices at 5130
Road.

Jones, Cosgrove & Miller.

to

to

each

type of organization snould
impose neither too much regula¬
tion

in

too

nor

that

sure

little, but should in¬

each

type is conducted
that is in harmony with
position that it \fills in our

a

way

the

over-all

This

financial* network.
will

entail

continued

ap¬

plication of special regulations to
commercial

banks.

capable. The

This

is

ines¬

supply must
continue 1o be regulated in such
a
way
as
to minimize the risks
money

of inflation and

contribute

mm

deflation, and thu-;
orderly growth

the

to

of the economy. This is no reason,

however, to
mercial

that the

assume

banks

com¬

doomed

are

to

stagnation.
Long Ilun Growth
Over

lieve

the

in

longer

growth

of

Whether

if

we

be¬

economy,

we

run,

growing

a

believe

must

in

the

continued

commercial
the

over

banking.

next

decade

commercial banks will grow more
or
less rapidly than other finan¬
cial institutions

Many

is difficult to say.

diverse, factors

growth

of

rates

savings and

as

such

loan

affect

the

institutions

associations,

insurance

companies, mutual in¬
companies, and pension
Basically they will be af¬
by changes in the prefer¬

vestment
funds.
fected

of

ences

the

public

yyyy^yy

different

for

types of financial services, by the
types of credit demands and by
the legal and
regulatory frame¬
work

within

Thai

which

framework

that

makes

does

not

they

TO THOSE WHO DREAM

operate..

should

economic

be

one

sense

and

THE DREAMS THAT KEEP

discriminate

against any
particular type of institution. But
it

'should

used

as

not

be-and

means

a

of

cannot

protecting

AMERICA GREAT...

be
any

institutions' "share of the market,"
or" its
assumed vested interests.
Given

i&y$Y
>

v. - yy/y/y.

these

underlying condi¬
position of commercial

the

tions

banks in the financial structure of
the country

the

will be determined by
in which bankers adapt

way

the

to

changing needs
of
the
It
is
by
having the
imagination to see and the initia¬
economy.

tive

to

tunities

exploit

economic

growth

the

for

new

bankers

possible
organizations—

their
the

in

by

greatest

not by trying to throw

roadblocks

oppor¬

uncovered

that

progress

insure

will

the

for service

temporary

of com¬
institutions, either other
commercial banks, or savings and
way

peting
loan

and

similar

financial

cor¬

porations.
In view of the development of
holding companies, chain-banking,
the branching of savings and loan
associations, and the establishment

of

an

unusual

number

of

singlebanks, the question of branch
banking, likewise, requires a fresh
unit

examination

by

the whole

finan¬

cial

community, in the light of
public needs and demands. Ours is
a dynamic
growing economy. Our
population

is

increasing

our

and

Rebuilding and
cities, building of
the

creation

of

expanding
new cities,

new

Joining four other great Cities Service lab¬
oratories, these newest facilities will provide
the most advanced equipment for research in
petroleum and allied fields. Included is a mod¬
ern nuclear section for
long-range research in

Service believes it is altogether fitting
splendid-new research laboratories at
Cranbury, New Jersey were dedicated to those
who will use them so wisely and well.
Often unsung, sometimes unappreciated,
that its

men

the field of process development, fuels and
lubricants—the heart of which is the largest

of science in the industrial labora¬

tories of the

country are a national resource

concentration of irradiated cobalt

beyond the command of money.
They kindle the fires of imagination and
keep them burning. They spark the constant
development of new products and the con¬
tinual improvement of established ones. Be¬
cause

of their dedication to the

new

ern

to be

laboratories and their advanced

new

■equipment.

and bet¬

the

build, salesmen can sell,
grow in usefulness, and

ter, management can
every business can
tlie public benefits.

ever

supplied by the Atomic Energy Commissions
Brookhaveii National Laboratory.
Cities Service is proud, indeed, of its mod¬

men

.

.

but takes far greater pride in

who will

man

them. It's their dedica¬

tion and skill that

service

.

•

•

for

spark our growth and our
today and for tomorrow.

rapidly,

and is constantly relocating in ac¬
cordance with -resource develooment.

Cities

the

suburbia




"IllilUR

mm

1H18EE1S!

Mr.

officer of

of de¬

applicable

vice-

president of the corporation.

permit

mands for funds and in the prefer¬
ences
of savers. Therefore
Gov¬
ernment

15

(487)

i 111 Hi IIIIH

CITIES

@ SERVICE

and Financial Chronicle... Thursday, August

The Commercial
16

1, 1957

(488)

on the continuing
control of the level
of
Federal
expenditures.
What
this means simply is our national

attention

Fiscal Action to Promote

Stability and Growth
Consultant Langum advises for the present
and the maintenance of

and fiscal

}

areas

some

are

problem

remains

before

a

nation.

the

spite of soft spots in
of

the

economy,

record

Severe

of

levels.
pres¬

in

the

and

with
for

policy and credit restraints,
in my judgment. The good shortrun
outlook for business and the

through
sav¬

immediate

ings. Manyprices and
costs

moving
still

with

up,

to

in

come

mediately

more

the

increases

months

im¬

should

ahead.

give

Looking ahead

ing under

sectors of

The adverse effects

of inflation

may

than the current ad¬

more

justments necessitated by higher
prices
and
costs.
Beyond
that,
there

is

impact

the

of

vicious

inflation.

cumulative

Not

least

bit longer, it ap¬
likely to me that the private

pears

pressure.

of

and

growing

the

does

and
by
investment
managers that continued inflation,
in

certainty.

top of the investment boom would

certainly be followed by a down¬
turn in business of a degree which
should

not have

and

need

In

these

to

point

fiscal

monetary policy

as

demands

an

economy.

Outlines Strong Fiscal Action
In the

fiscal

field

this

calls

terms

by

eral

declining

of

is

omy

how

TO

corporate

in

tion

our

a

THE

Difficulties
current

concern

Federal budget has served a
ful purpose

the

over

gold

Sells
A

&

Stuart

headed

Co.

Inc.,

from June
1, 1958 to
inclusive.
The certificates
priced to yield from 4.10%
to 4.65%, according
to maturity.
Securing the certificates is new
standard-gauge
railroad
equip¬

1972,

were

estimated

ment

as

that the

a

method

haps

than

policy of creeping inflation leads
to

tion

the
come

than

inflation

and

more

ancl

bust,

people get

on

inflation
up

bandwagon,
must
with something better

"let's

have

order to avoid

a

a

bust

now

in

bigger bust later."

Three percent creeping inflation
brings to mind another 3% theory
—

Professor

Cassel's

theory

that

increasing the supply of monetary
gold 3% per annum compounded
results in

a

stable price level. Per¬




that

the market.

on

'»•

It wasn't

a

tion's

convincing

very

Southern Pacific is another

in fact the na¬

quality rail,

v

con¬

third

system

largest

with

important interests in
lands, real estate, pipe¬

display and the low level of oil
volume made it mostly a little lines, etc. Southern Pacific, it

seesawing in the midst of the
doldrums.

summer

thoroughly

showing

The

is conceded, will

probably not
year's $8 earnings
results
are
being pro¬

match last

mixed

in the

up

good earnings of the market levels, is well shel¬
giants — including record tered and a long way from be¬
peaks for such as Bethlehem ing in any jeopardy.
Steel, Chrysler and U.
S.
Rail Equipments Neglected
Steel—were greeted calmly.

pated

less

not

cost

fell

back

in

Again

with

tune

the

Brake

Air

York

New

cur¬

profit-taking in the industrials rently derives only about
30 % of its sales from the rail¬
and what buying had been
road industry. Diversification
around in anticipation of
a
in
recent
years
has added
forthcoming freight rate in¬
road building machinery
crease dried up rather rapidly.
❖

and parts along
that have been
important uses in

equipment

*

*

with
The rail

$7,500,000.

Other

members

the offering

of

pumps

picture

isn't

year

his

avoid

to

studies

a

return

to insure

one

should

a

to

3%

be

re¬

addi¬

monetary stocks, stabilize
they are today and pre¬
vent
a
sooner-or-later collapse?
The great depression of 1873-78
was

as

followed

by

the

SANTA

Henry

BARBARA, Calif.—
Clapp has joined the
J. Watkins, 1018 State

B.

staff of A.
Street.

With

hopeful

able to boost

of

revenues

being

and net

"Gold

Re¬

gold resumption now
creeping-becoming-gal¬
loping bust?
WILLIAM PETTY

sure on

It all added up

quality ones, are showing the
better yields available in the
present-day market. Santa Fe
at recent prices was close to a
7% yield, Norfolk & Western
above 6% and Union Pacific

Now Merrick & Co.
MATEO, Calif.—The firm
Merrick

changed

has

&

Co.

Merrick

to

at 222 East Fifth Ave.,

are

with

branch

a

Co.

&

Market

at 528

St.,

Union

A. M. Kidder Branch
GREAT

NECK, N. Y.

&

office at 55

Inc.

Co.,

with

has

a

Station

Gondelman

George

and

manager

A. M.

—

opened

North

Robert

Barker

manager.

Saunders, Stiver Adds
(Special to Thf Financial Chronicle)

Steiner

is
&

now

Co.,

with

Saunders,

Terminal

Tower

Building, members of the Midwest
Stock

Exchange.

with Gottron,

He was formerly

Russell & Co.

Milton Steinhardt
Steinhardt

awav

suddenly July 25 at the age of 60.
For 37

New York City,

ber

July 29, 1957.

change.

of

years

the

he had been
American

a

Pacific, like

months

of

income

was

lion

some

indicate

sults

$3.50,

Ex¬

much

as

as

,close to it, against

or

$2.56 last year. In any event,
$1.60 dividend with its

the

6V4% yield doesn't appear to

Poor

of

this

special danger.
is

Co.

&

a

bit

more

year

the

oil gets underway.

nearly $2 mil¬
$10V2 million. One

to

tion

on

it had

its land and in which

an

14

interest,

ran

million

barrels

to more

last

Nevertheless
been

has

for

the

much
That

as

Producing.

Even

as

a

rail

company

profit

net

half again as
earned last year.

year,
it

would

which makes it a bigger
operation than certain oil dividend
companies including Ander¬ yield is
Prichard and Texas Gulf

the

lifting

neatly and could earn $4.50

oil

son

i;.

if

up

study shows that oil produc¬

mem¬

Stock

projections for full year re¬

*

*

year

passed

has snapped
year.
Some

the other Western lines, de¬ dependent on rails, approxi¬
serves attention as much
for mately half of its .sales from
rail
supplies. But its road
its oil income as its transpor¬
tation activities, yet the over¬ building machinery is up to
all disinterest in rails per se 30% of the total and could
climb to the 50% level when
has had a disparaging effect.
the road-building program
Nevertheless, in the first four

than

Milton

this

if

CLEVELAND, Ohio—Stephen S.
Stiver

company

well

back

be in any

nearly 5V2 %.

Francisco.

San

rails, including the

$

The

to a picture

Dempsey-Tegeler & Co., 113 East
Philadelphia Street.

Rex

was a

it late last year

■f

where the

of

There

year.

#

❖

■f

Homer II.

—

yet to wander over a
five-point range for the

full

(Sp xiiaJ to Tiie Financial Chronicle)

after. Would
a

fact has

aircraft contract.

by the higher freight rates.

Dempsey-Tegeler

sumption Prosperity" of 1879 and
obviate

10%. Never¬

*

•*'

bit of pres¬
when
income over last year's full- earnings were shaved by the
expenses of starting up a new
year
results by a brighter
plant plus cancellation of an
last-half
showing, bolstered
still

were

(Special to The Financial Chronicle)

gold, reval¬
annual

than

more

theless, industry statisticians
Joins A. J. Watkins

Plaza

current

to

prices

back

Shearson, Hammill & Co.

Associate

Would
ued

galloping

to

branch

examined at the present time.
who think

on

of Southern Pacific Co. to mature

as

us

exerted

from the light
the selling

as

pressure

field have

its

expand importantly.

Some of the so-called "rail-

of 4V2% equip¬
ment trust certificates, series XX,

Kidder

price inflation.

Chronicle:

buying

tivities in

equipment" issues have been
Rails, which had started to similarly laggard in tune with
by Halsey,
the carriers themselves. But
stir out of their long siesta,
July 26 of¬

$6,000,000

fered

because it has focused

stable price level by planned creeping

Editor. Commercial and Financial

of

Equip. Tr. Glfs.

group

name

devaluation

tinued to

much from the lack

as

Rails Lag

use¬

EDITOR:

a

ings

Potter has become connected with

Profit and Real Income

Petty suggests re-examination of Professor CassePs

monetary

more

.

Halsey, Stuart Group

WHITTIER, Calif.

for

Fiscal

theory of obtaining

as

..

.

growth

Creeping Gold Devaluation to
Prevent Creeping Price Inflation

of

on

public services, and how
much on private investment and
consumption.

Offices

Those

much

how

security,

essential

been

Reader

expanding econ¬

of expenditures on

take the form

national

an

period of interrup¬
trends, when
and if it comes about, will be an
appropriate time for decisive tax

ditures, such

Federal

Dr.

on

has been grow¬

serves

results but
earnings jected to around 85.75. At this
and in a troublesome world, statement kept sentiment cau¬ level the $3 dividend, provid¬
much of our real growth shall
tious.
And
the
well-antici¬ ing a 6V2% yield at recent

SAN

LETTER

but so is the

big,

is

budget

United States. The problem is one
of balance. In an

reduction.

Langum before
Policy, Joint
Committee, Washington, D. C.

the Subcommittee

time

some

Given the level of Federal expen¬

The
statement

Economic

where avoidable ineffi¬
ciencies
and
market-supporting
subsidies are involved. The Fed¬
ticularly

it

area

ing steadily and industrial ac¬

v

services
underlines
tne
necessity for-the most searching
scrutiny and stringent control of
other Federal expenditures, par¬

moving sidewavs in

over

expenditures, with due regard to
*A

high this week. The

new

public

certainly

a

economy

economy

spiraling

strong efforts to restrain

We

profits and rising unemployment.

well—designed

the

on

A decline in business

could some¬
recession, a moderate
decline in business activity. Even

action—and

to restrain somewhat the

meant and
growth in

mean

degree of severity implied

time have

not

circumstances, the ob¬
stability and growth

of

of

prospect

never

now

year.

the

real

both

of

not

dead.

■have.

jectives

faded

the last 12
months. The urgent priorities of
national
defense
and
essential
during

advance

a

list backed up a bit decisively
in the face of limited offer¬

•v

ingly translated into action, could
bring much more inflation.
Further, a speculative bubble on

we

businesses.

most

to

to

so far this
winning
calculated to aircraft and missile work.
by the word depression, in my
group are: Dick & Merle-Smith; encourage investors. For the
judgment, is simply not within the
R. W. Pressprich & Co.; Baxter &
first half carloadings were
reasonable realm pf possibilities
The stock of Air Brake has
Co.; Freeman & Co.; Ira Haupt & down
in the modern American economy.
moderately but rising
Co.; McMaster Hutchinson & Co.;
been unusually neglected, in
But the business cycle is not yet
wages had clipped net income
Wm. E. Pollock & Co., Inc.; and

degree, is a
views, increas¬

These

has

years

every

of

gradual

a

some

annually
and

record

growth in the American economy
is a proud one. But growth over

leadership,
at least

economy

well

The

business

by

the American

forward.

belief

the public,

a

face some continuing
stubborn problems in moving

the difficulties here is the

by

consideration.

due

Overall, the
American economy is still operat¬

include

inflation,

of

problem

that these
will always be the economic con¬
ditions
and
prospects to which
monetary and fiscal policies

K. Langum

STREETE

Declines

profits of

however, does not mean

Jonn

still

are

easing

there should be no general
of tax

avail¬

current

and

investment boom

Until the

inflationary pressures clearly end

ning the sup¬
plies of funds
able

Treasury

support

to

Federal

funds outrun¬

made

time

public debt operations and beyond
that to back up indirectly current
Reserve policies.

money

markets,

surplus in the

is

budget

capital

demands

cash

a

this

continue

sures

maintenance
Federal
particularly needed at

sirable. Furthermore,

are at

recent

in

in constant prices has

come

prospective state of the Federal
budget, general tax cuts at this
time
are
not
economically
de¬

of

measures

activity

In

parts
aggregate dollar
many

WALLACE

Stocks abandoned, at least Union Pacific qualifies as a
temporarily, their attempt to blue chip, with above-average
develop¬
nudge the industrial average growth possibilities since the

economy.

common

to

priorities of national defense and
social welfare. In the light of the

real

very

By

ex-

capita disposable personal in¬

Per

past 12 months.
Inflation

private

of

corporations and serious difficul¬
ties in maintaining profit levels

of
real disposable personal income to advance in the

capita

per

the

occurred

have

having profit difficulties, and the inability

now

by

up

in

ments

may

considerations." Notes

policies should give due

are

benefits

pointed

face continuing and
problems in moving forward "to which monetary

stubborn

in

vital

penditures. No doubt this has been

Discerns fur¬

Federal cash surplus.

a

ther ahead that the private sectors

THE MARKET... AND YOU

to

want

we

spending of our in¬
broad terms, oetween

penditures and the very real
benefits of most government ex¬

general tax cuts

no

how

to

as

divide up the
the

Chicago, III.

Consultant,

Economic

decision

comes,

LANGUM*

By DR. JOHN K.

again

challenge of

on

available.

Co.

the
a

In

$2

6V2 %

fact,

hope that Poor
would
increase
the

there is some

&

double
which

Number 5660

Volume 186

...

The Commercial and Financial Chronicle

(489)

dividend if the

earnings come
expectations. As re¬
cently as the end of World
War II this "rail equipment"
to

up

entity depended on rail busi¬
for

ness

it, too, has come a

so

revenue

total

of

90 %

some

way down
cation trail.

long

the diversifi¬

Heads Fund Drive
Scott, Jr., of Carlisle &
Jacquelin, new Travelers Aid Ex¬
ecutive Committee Chairman, will
head the Stock Exchange Mem¬

Division

Society
Annual

Neglected Utility

neglected issue more or
less guaranteed to make a far
better showing this year than
last

Water

American

is

operations
should equal or better

alone it

its

On

Works.

last

year's $1 per share net
and, in addition, is preparing
to sell a water property which
should add another $1.60
after

and expenses.

taxes

Fund

in

nounced

A

of

Travelers

New

of

Drive, to
Fall, it

the

today

Aid

York's

be

con¬

was

John

by

52nd

R.

an¬

Mc-

Ginley, General Chairman of the
Drive.

Sixty
and

the
the

thousand,
travelers

one

nine

hundred

helped by
Society's multi-lingual staff in
terminals

from

the

on

piers

1,830

alone, 7,331
people,

791

children

aged

people

who

became

suddenly ill while in New York,

for those with

Travelers

Aid, which is sup¬
ported entirely by individual con¬
tributions, is now in urgent need
of funds.
Mr. *' McGinley reports
that 300 key executives
in the
New

York

in the

the

area

Lockhart is

A.

coming

now

(Special to The Financial Chronicle)

Harrison, Inc.,

with

SAN

Richard

Sixteenth

2200

worth Avenue.

With Walston & Co.

Joins Englander

(Special to The Financial Chronicle)

Co., Inc., 265 Montgomery

members

the

of

New

York

MIAMI, Fla.—Gerald J. Robbins
is

now

St.,

Corp.,

and

Pacific Coast Stock Exchanges.

with Englander Securities

Miami

National

participating

are

services

during

York Adds to Staff

the

SAN

FRANCISCO,

Baron

J. Logan Adds
PASADENA, Calif.—Charles E.
Conway is now with J. Logan &
Co., 721 East Union Street.
,

Now With Atwill Co.

(Special to The Financial Chronicle)

year.

&

Herwitz is

Co.,

235

members
Stock

Montgomery

of

the

MIAMI

—

with York

now

E.

Street,

Pacific

Special to The Financial Chronicle)

t

Calif.

Kehoe

BEACH,
is

now

Fla.—Thomas

with

Atwill and

Company, Inc., 605 Lincoln

Coast

Mr.

Kehoe

was

formerly

Mclnnes & Co., Inc.

Exchange.

In

July declaration putting the
issue

quarterly

15-cent

a

on

for

against

last

rate

60-cent.

a

50-cent

year's

largest private¬

rate. It is the

ly-owned group of water com¬
panies in operation.
Dividend-Increase Candidate

dividend-increase candi¬

A

date, which has had a placid
market

its

life,

with

Borden

is

long string of

unusually

uninterrupted dividends.
Earnings have been on the up¬
1955

$4.61

from

rising

grade,

$5.01

last

in

with

and
$5.35 estimated for this

year.

It leaves ample room for

to

and

the

$3

back

moderate

a

even

year

of the $2.80 rate

increase

an

lift to

would boost it
the
5%
yield

level

into

column.
sj:

fol¬

little

been

has

There

lowing for the utility issues

generally lately, an out¬
growth of the tight money
held

had

which

since

ever

of less than
three full points has had little
in
the
way
of speculative
1955*;in

a

range

In addi¬

correct.

to

excesses

tion, its yield of

nearly 6% at

recent levels is above-average

the

in

The

section.

utility

has been whittling

company

difficulties, in¬
cluding the problem of ob¬
taining sufficient gas supplies
to keen up its expanded serv¬
ice.
The company has been
into the petro¬

spreading out

chemical field, in

has

Solvent*,

high

unusually

an

industrial

of

load

partnership

Commercial

with

customers

expanding use should
make its weight felt in time.
In fact, some 18 V of revenues
are from industrial accounts.
where

article

do

not

coincide

those

in

this

necessarily at any
with those of the

presented
of the author onlyJ

"Chronicle."
as

expressed

views

\The
time

This New Symbol
General Mills' 29th year
sion

was

our

marked by adoption

new

vision

of

corporate symbol—

appropriately suggested by

a

tele¬

They

(Special to The Fin ancial

Staff

Chronicle)

ANGELES. Calif.—Fred S.

Funakoshi has joined the
Walston

Spring

&

Co.,

Street.

Inc..

He

just past, it

reproduced millions of times
of

consumers

than 60 countries. You could

find it

flour

on

packages, for in¬

stance, from Des Moines to
from

in

Genoa,

Spitzbergen to Hong Kong.

this

symbol contained products

that also

Betty

were

new

to the world.

Crocker Li'l Angel Food

Cake Mix, Betty Crocker
and

roon

Chocolate

Maca¬

Macaroon

Mixes, Betty Crocker Cream Puff

550

was

Morgan & Co.




staff of

South

were

just

a

few. Even that

stoutly entrenched favorite of 30

years—Wheaties—appeared in
new,

modern,

Our

new

formerly
up o ver

more

a

delicious form.

corporate symbol went

the entrances of three new

Fiscal

companies—loca ted, signi fican tly,
in

different

three

chased

Years

In

countries.

October, 1956, General Mills

Ended

May 31

1957

1956

$527,701,677

$516,052,804

12,235,111

14,055,658

7,948,253

6,225,971

4,288,852

7,830,687

2.2c

2.7«

$4.88

$5.68

pur¬

Ready-To-Bake Foods

Total Sales

wholly-owned subsidiary

as a

headquartered in Los Angeles.

Earnings

Prote::, S. A., of Mexico City was

bought in January of this year.
Formation

of Habib-General

Limited of Karachi,

Pakistan,

announced in May. 1956;

Dividends
Declared

was

General

Earnings
Reinvested

Mills will
These

Many of the packages bearing

are

Joins Walston
LOS

year

to reach the eyes
more

of Growth Circled the Globe in 56-57

Inc.,

screen.

During the
was

Mix

with

of expan¬

at many

away

and

S2S

Gas

Columbia

But

market.

Bank

Building.

fact, the company already has
raised its dividend with the

basis

Sees.

(Special to The Financial Chronicle)

SAN FRANCISCO, Calif.—Leon
R. Coleman is now with Walston
&

MATEO, Calif.—StanlevW.

Ross has joined the staff of
James
Love Company, 460 South Ells¬

Street.

$395,000 drive to maintain

Society's

With James Love Co.

SACRAMENTO, Calif.—Thomas
L.

needs, are services given
by this unique non-sectarian vol¬
untary agency.

traveling

handicapped

or

assist¬

special

in 1956; among them, 283 runaway

children,

on-the-spot

care

Harrison

(Special to The Financial Chronicle)

world.

people in trouble away
home, plus travel planning

protective

Joins Richard

ships from

to

ance

and

Ameri¬

new

441

on

countries of the

were

ancl

and.

came

Immediate,

Stuart

bers

refugees
who

cans

67

ducted

A

5,894

Stuart Scott, Jr.

17

GO',c of its stock.

own

are

only examples of the

year's progress. l or the complete
story,

you are

earnings—

per

dollar of sales

invAed to write for

General Mills Annual Report.
Address the

Net

Department of Public

-per

of

share

common

stock

Relations, General Mills, Inc.,

/

Taxes per

Minneapolis 1, Minn.

of

An annual report,

only

a

of

course,

record of the immediate

icey

serve

mankind

is

toward

Mills
new

moves

horizons.

stock

8.16

9.00

85,531,908

72,602,048

71,255,023

73,998,059

136,100,981

131,456,892

i

Land, buildings,
and

equipment

the

to the future. Led by research,

General

common

is

past. Finding new ways to make
materials

share

Working capital

confidently
Stockholders' equity

Road.

with

-

18

The Commercial and

(490)

Financial Chronicle

...

Thursday, August 1, 1957

Municipal Bond Women's Club
Annual Outing June

The

Municipal Bond

Women's Club of New York

held their annual outing June
Golf

Club

in

Convention

Members

Brownell,
Dorothy

and

Chas.

Root,

Shields &

of

the

E.

F.

S.

28th at Morris County Golf Club

28th at the Morris County

Station, New Jersey.

outing

committee

Weigold
Smithers

&
&

Co.,
Co.;

were

Inc.,

Jane

N.

Chairman;

Constance

Hav,

Company; Margaret Burns, Fabricand & Co.;

Anna Prentice

Bankers Trust

Company.
Front

Row,

Back

Jeannette BoondiS, Gregory & Sens; Marie Downs Noceti, Paine, Webber, Jackson &
Joseph ne Rodd, Goldman, Sachs & Co. and Louise Bullwinkal, Tripp & Co., Inc.
Potts, Dean Witter & Co.; Marion Junker, Chemical Corn Exchange Bank; Estelle

Louise Pike;

Curtis;

Row,

Helen

Hanvey, Wood, Struthers & Cc.; Gloria Berardini, Rand & Co.; Virginia Ramsdell,
K&YSS//S/S%'//SS/]wfYSS%s/SS//y/Sj/S*lvSSSSS/SS/S/%SS/sS/y/S//SS/S/SSSS/SSfY^

Front

Front

Back

Back

Row, Justina Taylor, The Chase Manhattan Bank; Doris Niederauer, Bankers Trust Company;
Eleanor Kube, Spencer Trask & Co. and Jacqueline Menard, Lee Higginson Corporation
Row, Betty Pollock, Harris Trust & Savings Bank; Maureen Gough, J. J. Kenny Co.; Rosemary
Duggan, Merrill Lynch, Pierce, Fenner & Beane; Angela Policriti, The First National City Bank of
New York; and Jeanne Skippon, Adams, McEntee & Co., inc.
1

Front
*

Row,
Row,

Row, Virginia Dunn;
Row,

Lehman

Lillian Whelen, C. F. Childs & Company; Alice Dooley, Ira Haupt & Co.;
and Madeline Sundstrcm, Chemical Corn Exchange Bank
Manfredi, Coffin & Burr, Inc.; Ruth Miller, Lee W. Carroll & Co.; Norma Detlef,
Brothers; Helen Kane, Model, Roland & Stone; Adrienne Neivert, Sutro Bros. & Co.;
and
Ann Schrieber,
Mitchell, Pershing, Shetterly & Mitchell
Pierina

Elizabeth
Chemical

<

Back

Marilyn

Rowland, McDonnell & Co.; Mary Ciarlo, The Bond Buyer; Elsie Schuyler,
Corn Exchange Bank; and
Sara Powers, R. D. White & Company
Ellsworth, Kuhn, Loeb & Co.; Betty Dickinson, C. F. Childs & Company; and
Gladys Degner, King, Quirk & Co., Inc.

Front

Row, Ruth

Back

Row,

Jones, Bear, Stearns & Co.; Mae Walsh
White, Weld & Co. and Betty Hanser,

Vernette

Bonn,

Carl

M.

Loeb,

Madeline

Constance Hay,
&

Co.;

The Guaranty Trust

Company of New York; Vera Smith, C. H. Walker & Co.; and Kathleen A. Daly, Empire Trust Company

Jane N.

Shields & Company; Margaret Burns, Fabricand & Co.; Dorothy Root, F. S. Smithers
Brownell, Chas. E. Weigold & Co., Inc.; Emma Brehm, R. W. Pressprich & Co.;
and Anna Gross Prentice, Bankers Trust Company




Jean

Davies,

Wainwright

York;

Helen

Kessler,

& Ramsey, Inc.; Ola Smith,

Kane,

Model, Roland

<£

Rockafellow, Flagler System;

Hemphill, Noyes & Co.
Co.; Grace Zvonik, Laidlaw
Bache & Co.

Rhoades

Stone;

&

The Marine

and

Norma

Trust Company of
Detlef,

Lehman

Mary
&

Co.

Dillon,
and

Western New

Brothers

Volume 186

Number 5660

The Commercial and Financial Chronicle

...

(491) ' 19

Price Inflation Environment

;

J. W. Clarke & Go.
Silver

Affecting Insurance and Savings

By HON. HERBERT HOOVER*

gins, the heavy volume of post¬
financing

war

expert assays the insalubrious relationship of sav¬

ings and life insurance to inflation.

And Other Matters

Increasing
Federal
and
state
regulations, narrower profit mar¬

By ROGER W. BABSON

Financial

Anxiety Over Inflation

Anniversary

complex

Recommends making ad--

the

and

Former President

more

Former

-

ture

of

the

Chief

Executive

inflation

.■
,

-

iadadng

m

factors;

and

Board's policies
Statistics

be

can

used

to

prove

what you want

to prove—or tney
be used to show what they do

can

Money is used universally,

prove.

and

its

reading G N P data; ouilines

flue-

Federal

suggests

i nvest

Reserve

considered

in

consumer

calcula-

all

prices,

have

The

to

ceases

on

buy

and

we

lions.

problem i
fin d
unit

t

s

o

reduced

possessing

are

na-

f;rm

W.

bills

v/hich

John

is

ment

gradual increase in ;prices ,w. Clarke & Co. which

Aug. 1,

on

now

going

:

common

wsii

trnnhln

cause ..trouble

,mit—whether

.

has

dollar, pound,

a

tendency to become less and

a

less valuable.

problem

to

States.

United

has debts

from

one,

our

The

even

dollar

do

so

Money is always

every

a

the

boy to the President of the

paper

the

franc—

or

as

becomes

savings

Government

and I.

you

its effort to

become known from coasfto coast

oi

less

the Board

courage

of busi-

necessary

to

carry

Administration

they

way

likes

to

has

ness

speak of the Gross National Prod-

has

Field

because

local

because it probably makes every-

Building

thev

were

that's

the

today. But the busiexpanded,' and the firm
are

manager

been

important

an

factor

$3 billion

financing.
It has been coof the $101,000,000 Calu-

stroy wealth take the best youth
wealth, take the
of the

±00d' clotmng> ancl shelter.

item

ive

The

d

heafvomh

ttTv

nations, settle nothing, and

f

-whim?

.

This

debt

must

be

paid

the

by

known

the

as

National

Debt.

.$1 billion.
Today it is
$275 billion and it costs

over

around

about

billion annually to pay

$9

the interest

on

We ha ve

the debt.

fought wars to end all wars, but
one'imay end everything

the next

There

are

.

-many

people

graving, avatch a worker hold up a
blank sheet of paper, push it into
a machine, pull a lever, hold tne
sheet of paper
up
again transformed into $1,000 bins, you can
readily see how they get that idea,
The end of printing such money
may be complete repudiation and
catastrophe.

With the exception of our years
.

^

bas T?-en a well-known 1

5% convertible subordinated .sink-

ing fund debentures due May
The

debentures

are

i
T

m

1972.

convertible

V into common stock of Ogden
who- at tl,e
per^ are.

problem
could
be
solved by printing more money.
When you .stand in the .balcony of
the Bureau of Printing and En¬

the bond financing for the

as

^my, serv^e with the
privately, through Allen & Co:,-y
SO^rnment ninits in
New York, an issue of $5,600,000 Airica and italy, Jonm b a
,

;

money ;,

in refunding the
bonds in 1936 as

dm

t

Salle Street m

o

.

1c

Corp.':^tSTreat^xpansion

of
Mr. Clarke quickly
rose through the ranks to be sales
p->ana!?er,
• and
then
Executive

the
-

L. P. McGean Joins

'

L. B. Schwinn & Co.
(Special to The Financial Chronicle)

When

i

-

»

that

of

Brokaw

Co.

&

was' licrui-

company

dated in 1932. Mr. Clarke started

Ohio

—

his

own

business.

Lee

.

department' of to the staff of Baron, Black, Kolb
& Lawrence, Inc., 253 North Canon
Saunders, Stiver & Co.
municipal

the

of

Drive.

.

In
1933, Labor Unions had a
membership of around three mil-

With Field & Teeters

lion; today it numbers around 13
Since

million.

labor

this

of

force

means

we

have

almost

a

70

that less than

liam

million;
T0%" of

&

tiie workers'are unionized.

majority .of

harmful both to the gen-,

ities

are

eral

welfare .of the

their

own

members

nation and
as

to

well.-Labor'

should get a-fair wage but its-production.- should
increase
in
lind
with

its

wages.

Otherwise,-these

workers reduce the value of your

savings and life insurance.
Vicious

The

_

'

Spiral

The Union-demand 'is always for
or
shorter hours.
Willing to grant increases
so
long as production is
being -increased,
but otherwise
such raises are just like printing-

higher

wages

Employers

are

press money

rise

in

goods.

the

and are followed by a
prices

of

consumer

Increased prices are soon




Lewis

Teeters

is

now

CSpecial to The Financial Chronicle)

Fla.—Wil-

Allen

>

7"!

HILLB,
■

uaJf.

.s,
p°
°t Daniel D. Weston &

Investment. Company.

f

EAST

BEVERLY--

with Field

+

tbe

Co., Inc., 9235 Wilsluie Boulevard,

.

of

members

Form W. A. Steadman Co.

nation's

the

workers- Some of the union -activ-

PETERSBURG,
C.

16725 Gulf Boulevard.

How-

the leaders of this 30% prac¬
tically-set the standards -for a
ever,

large

ST.

civilian

the

Pacific

Coast

With

& Co. has .been

formed with offices at 604 Central
Avenue to engage .in- a securities
business.
Officers
aie. ."William

Grover

(Soecial to The Financial Chronicle)

-

•

?

-

become

associated

Dill Richards & Co

f

j

-

Now With Adams-Fastnow
v

- 'Special'to The

'

7

-.

'

■

2 With Denms^y-T^peler
^SpeciaUto The Financial .Chronicle)

Financial Chronicle)

.

LOS ANGELES, Calif.—Joseph
LOS ANGELES, Calif.—John H.
Sattler has become affiliated with Grobaty, Jr. and John E. Lucas
Adams-Fastnow C-ompany, 215 have become
associated
with
West Seventh Street, members of Dempsey-Tegeler & Co., 210 West
the Pacific Coast Stock Exchange. Seventh Street.

Mr. Sattler

was

Akin-Lambert

previously
Co.,

Inc.,

Pledger & Company, Inc.

penditure
Then

Mr. Grobaty was

with previously with Barbour, Smith &
and

Co.;

Mr.

Lucas

„

mrr.

veir

$14

•

billion

trust

ex-

funds.

And

expenditures which I will
a

there is still another

,,

..

,

reduce

to

is

with

agree

essential

this

Scmator

function

^pending.

Byrd

-

■

.

..

■

.

,

cannon-ball

one

.,

where

newspaper editors
could
immediate hand. The Com-

an

mission

Organization

on

Government

.Federal

called

for

years
are

has

devel-

of making forextending

not

various
the

the

as

Congress.

of these advance

estimated

purposes,

annual

appropriations such
before

should

read

T

budget
those now
The total

appropriations is
be about $70

to

the

as

in the

was

California Company.

with

that

First

the

Sen-

a

to what

use

actually
these ap-

of

Congress by

this

de-

vice has lost control of the purse,
since

that has
funda-

Runnymede

been the first protection of

mental liberty.

have

al-

service;

,

.

_

11
years
0:
lrma ed. that ours has become
^
^v0.rst mechanism of govern.

!TJe

^be worlcl

,,in

except all

ers 011 earth.

mentally far
ing

on

something fundadangerous go-

more

free

among

vvasteful

abd

hig

lhan

men

expenditures.

impulses

even

Man's

the unknown

under

freedom

do it havevled him .further and
fm-ther

into

the
To-

day the scientist, with the aid of

standards

of

-

governmental
UBable

-to

Think it

mankind

action

control

its

and

have

these

been
forces,

over

Not
.Don't

This

great
even

jt

a

think

trials

Pessimist
I

Republic

am

has

in

pessimist,
through
past.
It has
a

gone

the

rectified legislative mistakes.

has

changed Supreme
Court views. By its religious faith
and Rs love of liberty, it has always

even

made

a

comeback

gi'eatness

creased

'

.

.

j

in-

to
•

•

•

'

.

.

Bank of Montreal

Appoints Kjeldsen

testimony of the

Controller General before
ate Committee

editorials

yeomen

to

appropriations

These

given

the

oped the practice
over

the

of

attention

recent years

over

Government

ward

read

our Federal Governcut expenditures. News

and

' the
engineers have introduced
J new and gigantic forces into our
item
civilization. But as yet the ethical

the deck ot these expenditures

on

take

can

that( curiosity to explore

Lost Control of the Purge
.

is

other

discovery
of
.the Govern--fundamental laws of Nature.

of
.

There

wring

common

the Commission recommends

columns

froiiythe Federal ex-

.

m.

the

to

But there is

rrtei1^*

:

ment

,

anywhere from $6 to $10 billion
could. "be cut

nation's

can

King John of the For¬

e

^Theparticular inflation to stop
only effective y/ay move-

ment

the

You

tason -and

moment.

this

I

hung

are now

where

in.

King John of the Pen-

$30 bil-

some

item of

,

Senator

I will not go info the 385

billion.

explain in

is

py which

^

about

through
need add

you

Under

concession

ways

.

.

lion state and local spending. By
all of which you reach over $110

And

BURBANK, Calif. —'Robert C.

Alldn Steadman, President; Harold with Grover C. Fillbaeh,
548
A. Kazmann, Vice-Pi^sddent, .and ]\-or^ San Fernando Boulevard,
Jessie M. Steadman, Secretary and ^ OMonroe was previously with
Treasurer.

.

-

aa
add

Budget, and the Con¬

General.

from

Hoover

rS
+
must

is

Fitlhach
%

has

,

recom¬

eign AM.
Herbert

*.

,

been

CHICAGO, 111.—Niels Kjeldsen,
Assistant
Superintendent' of' the
Bank Of Montreal's Manitoba and

pronriations. But the worst of it Saskatchewan district

f

jVlonroe

■

t

n

this
man

in¬

e

happens

Stock Exchange.

ORANGE," N. J.-r-William

Steadman

'•

billion—mostly in the defense and
foreign aid agencies. These monies
can
be spent during
any
fiscal
year in addition to the annual ap¬
propriations in the budget. \ You

Weston AcHs tn Staff

especial to the financial chronicle)

•

m

have

press 'comes

this

-npriding. The

now

-

.

.

Labor Unions

>

j o r

the fact that

P.
McGean 'has become associatedWith Baron, Black Co,
with L. B. Scliwinn & Co., Union
•'
(Special to The Financial Chronicle)
Commerce Building, members of
BEVERLY
HILLS,
Calif.
the Midwest Stock Exchange. Mr.
McGean was formerly
manager Bernard
Novatt has been adaed
CLEVELAND,

a

in

n

r

the

Here

up.

•

flation is gove

bills

concerned, and they
'

of

particular

1920's,

Vice-President

state

m

.

have passed the House Committee

not

to

forces

' %

Kennedy's leadership, they passed
'the
Senate
unanimously.
They

do

one

of

troller

penditures without damage to. any

h

when

1920,

tor

still

that

Galveston wharves.

think that the National Debt and
the

role

County

on

else!.

V; PriiitiiisT"** Money

Cook

Ogden Corp., it was announced
July 26, has arranged to place

1914, the ^anU..ai Debt was a airiuv National
wem a litloiT,

tie

prominent

Ogden Debentures

parking revprogram.
It had
a

bond

enue

well

In

Chicago

$41,000,000

Allen & Go. Places

youth of the country yet unborn.
These Government obligations are

•

shelter

supported by borrowed money.

are

•

and

I

save

year,

bv
the Commission, by
President Eisenhov/er, bv the Sec¬
retary of the Treasury, the Direc¬

is going down.

need

.

"Hung-Up" in the House
These

these
it

•

would

mended

recent months

—and

-a

' '

•

changes
:

cents

during

in

body feel better5 but remember met Skyway rapidly being com1;hat U is measured by a 50-eent pleted on the South Side of Chitha» by amounts ot ca«o as well as bo-manager of, the

Wnrs-ire the Government's most

five

or

the

the

"non-exoandibl-"—and

uct, which is measured in dollars,

The National Debt

in

rpnted

wprp

hnnse

bond

business "

offices

-

on

Conclusion
The

th|

in

it just increases the number

dollars

little

aq

business.

value,

accounts and life

Inflation does

increase the volume

not

ness;

of

in

life insurance.

our

As

insurance.

ht,t^iaiJZinS in common

'

i

protect the dollar, our savings, and

Federal Reserve
l,,
v,
to stem creeping inflation with
The money tighter money. We should all en-

-Rn„,w R.
.Roarer w. Babson

be

7

The

stocks
and
revenue
municipal
bonds. Today, with the same perSOnnel, the same Loop bank as
cashier, almost the same furniture, John W. Clarke & Co. has

Wen

it

time

in

in time,
ine
Board is trying

these

•

•

•

<

They are
warranted in that anxiety for the

nmv

ovUnty

c

i

Disavows
control the

can

on.

iessens by so much the value ot will celebrate its 25th anniversary. p u r chasingSrlhe doliar and oi' your savings de" ' Exactly 25 years ago when the value of the
(ir p' T in posils and life insurance- Thls Slt~ country was at the bottom of the dollar has lost
ichq
ft
nation is going on at tne present depression, John W. Clarke started. probably four
A
;
time, and unless it is controlled it
firm
spe-ialbinv in
e

Seeks support

power.

mated

On Ikp h-Qicnf

worth 50 cents

-

arrest

aid of the engineer.

"

Many have expressed great
anxiety over the inflation move-

v-iainc

to

forces unleashed by the scientist with the
'

•

John

order

"hung up" in the House.

now

*

The

in

pessimism and trusts mankind

any

and gigantic

new

wide

-

control

liberty," .'

slow-moving Hoover
unanimously passed in

f

14on

Creeping Inflation
This

value.

of

depres¬

lost

and, therefore,

prosaic

the Senate and

one

trend.

stable

a

and

Chicago

admittedly

task force recommended

in

but

sisted this

sion.

unemployment

n

a

m

tim |,as S1;IC~
cfissiully r e"

until the

go

be

must

deterioration of the dollar's purchasing

e

past,

increased

then

This will

and

for

n

shop"
almost
a thing of the

circle continues: Increased wages,
increased costs of production, iacreased

inflation

"o

an inin wages, and the spiral
goes round and round. The vicious

crease

be Wages.

always

today's

the traditional

met by another demand for

States

has

major forces in

com-

bined to make

•

tuationu must

field

have

United

of the purse—our "first protection of fundamental
and that government
spending is one of the

ent

m

banking

1

be encouraged.

the

charges Congress

*

justments for price inflation

of

na¬

six

for the past

has been
apoointed
special representative of
the bank in Chicago, according to
'years,

senior

an

announcement

made

over

the

week-end.

Th^re are Budget and Accounting bills in the Congress to **om-

He succeeds William E. Burgess,
who goes to the Assistant Gen-

edy this evil. They have no tear-

eral

jerking attachment and they pjovc
very slowly.
And these bills do

Vancouver, B. C.
Mr. Kjeldsen,
a native of Denmark, joined the
Bank
of Montreal at Winnipeg,
in 1928, and later served in a

more

than

restore

the

control of

the purse.

They provide the Federal Government with simplifica-

Manager's

variety

of

Department,

posts

and

improvements in both western. Canada,
budgeting and accounting. ; Our

lion

Task

Force

accountants
♦Fr^m

American
San

the

of

the

in

t

most

^eminent

country ,esti-

a

talk by
Societv

Mr. Hoover before the
Newspaper Editors,

of

Francisco, July

11,

1957.

eastern
,

-

and

-

JQins Hod^don Comoany
BOSTON,

>

in
-

in

Page

has

Rodgdon

&

—
Philip
N.
affiliated with
10 State Street.

Mass.

become

Co.,

•

and Financial Chronicle

The Commercial

20

Thursday, August 1, 1957

...

(492)

Continued

the

from first page

,11*>*??

the

a

was

Policies

Individual Management
As

further

Table

our

shows,

great divergence be¬
tween defensive - aggressive poli¬
there

was

the

by

followed

cies

manage¬

Income and Stock

Series,

Axe-Houghton Stock Fund, Axe
Science and Electronics Fund, the

Common

Securities

Group

Stock

those evidencing
defensiveness are Carriers & Gen¬

Fund, and the Value Line Income
Fund
are
conspicuous by their

increase in its hold¬
ings of net cash and governments
from 6.6% to 15% of net assets, a
boost in defensive securities from

shift

Among

ments.

eral, with

is

&

mutual investment fund of diversified

stocks selected for investment

common

quality and income possibilities. Mail
this ad for free booklet-prospectus to

an

2.7% to 7.2%, and a resulting de¬
cline of risk securities from 90.7%

CALVIN BULLOCK, LTD.

to 77.8%.

Established 1894

group are

aggressive¬

greater

ness.

the

On

other

Line
warns

of

the Value
continually

hand,

which

Fund

Nam#

Stock

Growth

Fund, and the In¬

of America.

vestment Company

Address.

market's

the

over-pric¬

still has the highest relative
position in net cash and govern¬
ments
of
any
fund here under

stock

41

transactions,

net

were

and 21 were net sellers,
with 10 an approximate stand-offs.

buyers

Bond Competition

The

policy

the New England

ture

appears that the analysis of
in using the
the
economic and business ele¬
high-yielding bonds as ments
by Tri-Continental led it to
a
haven of refuge is typified by
adopt hedging-to-bullish policies.
the following
contained in the In
a full-dress

advantage

named

last-

the

of

statement

editorial

management: "Your man¬

agement is very optimistic about
the long-term future of common

prices based on the indus¬
of our country and
the persistence of inflationary in¬
fluences.
However, in view of
stock

trial progress

the many

cross-currents and un¬
certainties in the present situa¬
tion and the fact that protection
against short-term market risks
can
be secured through the pur¬

INVESTING
for

chase

CURRENT

States

United

of

ment bills at more attractive rates

INCOME?

than for
»

A, T,oal fund

«

obiocfive

is

to

great many years past,
the

reduced

bills,

At June

each

Federal

industrial

index

Reserve

of

since Feb¬
ruary, money stringency, the high
level of capital expenditures, ris¬
ing costs, increasing competition,
the

and

production

development

weak spots, are

of

some

all cited.

Understandably then, Francis F.

Randolph, Chairman,

reported

to

the shareholders of Tri-Continen¬

of

total

assets

as

at Dec. 31,

at March, 31, 1957."

Among the managements step¬

investment dealer.

ping

The Parker Corporation

up

their aggressive policies

during the quarter were Fidelity

that

ercise

the

funds received from

new

of warrants

first, time

in

were

used, for

while, to
add to equity holdings. But he re¬
ported further that, there were
purchases
of
senior
securities
(limited

fering
of

to

new

relatively

Roe

"The Fund's relative stability of

capital values

with emphasis on the
inflationary pressures
President Harry

Coupled

attributable chiefly to

is the citation by

substantial

H.

Hagey, Jr., of the "alarming
aspects" of the continuing wageprice spiral despite the leveling

net

of activity, and the generally
mixed
individual
industry
be¬

repaid in

and

expressing
in¬
high-yielding

those

Among

in

interest

creased

paying

and

bonds

corporate

than

convertible issues are the Trustees

Shareholders'

of

tunities

that

available

made

have

advisable

con¬

servative

policy until the extent
of the present business readjust¬
ment can be gauged more clearly.
Meanwhile our reserves provide
the
highest return in
over
20
years.
A good portion is held in
short term bonds as a buying re¬
serve, and a number of convert¬
ible issues with interesting poten¬

tion

the

purchased
"to

bonds

in

ratio

common

inflation.

take

ments

tries

high-grade bonds."

it

reduced

its

The

bonds

favorable

of¬

rates

return); and that by and large,

Street

Stock

from

stock

Berkeley Street

factor

lar

Corporation.

follows:

as

inflationary bias of

Boston, Mass.

"The

is

however

in

the

selection of

consequently maintained the
position of the Fund

balanced

In

with

slightly less than two-thirds

its

basic

normal

in

common

<fJdodon
★

★

★

★

★

★

*

Massachusetts Investors

ENERGY FUND

cash

The Fund's

Growth Stock Fund

INCORPORATED

.

.

new

for

the

to

cash

or

equiv¬

common

stock

tenth

Economic Consultant's bearish
of

on

the

this

"the

money

definitive

re¬

important
factor
market," carrying
conclusion:

"In

a

longer perspective, with a basic
growth trend in the economy re¬

for lliose who desire

.

re¬

consecutive investment is concentrated large¬
month and now rest at their high¬ ly in industries that may be ex¬
est level in our economic history." pected to resist any further busi¬
But,
"contrapuntally,"
he
im¬ ness decline, or where the prob¬
mediately
appends
the
Fund's ability of longer-term develop¬
port

■7

the

mainder of the Fund in preferred
and

high

★

and

stocks

alents.

a

investment

maximum

stocks

to

secu¬

The management of your Fund

the

rose

that

investment standpoint the

an

continues to be evidenced. In June

price indexes

is

Fund:
obvious

care

has

economy

our

philosophy"

follows

as

rities.

his President's Letter, Mr. John G.
Pell stresses the inflationary bull¬
ish

indus¬

present situation calls for particu¬

on

Investing

leading

if they continue

"balanced

forth

"It

attitude likewise is
the
part of Wall

hedged

several

which,

ton

Hedging Advantages
A

equally cogni¬

are

by Emerson
W. Axe, President of Axe-Hough¬

holdings from 15% to 12%.

evidenced

in

and

set

previously,

preferred

We

Thus, the Fund's current 40 %60 % defensive-aggressive position
acts, in effect, as a hedge against
either possibility."

stocks,

time, as the Fund was thus rais¬
ing its bond holdings to 17.6%
from 13.3 % six months

cognizant of

unabated, might affect adversely
the
general
level
of
business.

available
on
At the same

yields

are

opposing forces which
already
caused
readjust¬

have

than $3,700,000 of
advantage of the

more

Trustees

existing potential for further

zant of the

Diversiifed
Investment
Fund,
Inc., managed by Hugh W. Long
and Company, while maintaining

70%

is to main¬

as

events unfold.

as

"The

tials have been added."

a

return

common

possible, the buy¬
ing power of your capital and in¬
come
under
varying conditions.
The liquidity of our bond invest¬
ments gives the mobility needed
to shift emphasis in either direc¬

main¬

to

relatively

present

our

chip'

Advantages of Liquidity

tain, insofar

consciously from the

seems

be

These

income"

'blue

"The Trustees' goal

Mutual Fund:

Johnston

higher

a

some

Other

through the further in¬

Also bond

tain

been

and

future.

near

oppor¬

in interest rates.

crease

"It

attractive

will mature

the

stocks.

Trust of Boston,

who point to the

corporate

and

issues are paying income today at
unusually good rates by compari¬
son with the rates prevailing over
the last two decades. Many are

havior.

high-grade

which

notes

short-term

of

—

government

bonds

off

the Fund's
holdings—21% of total

assets

some

issue

this period of

over

generally declining bond prices
and up-and-down stock prices is

Fund.

Farnham

&

E.

continuing

attractive

the issue of common, stock on ex¬

16.8%

Aggressive Managements

/mid is available from

200

the

in

and

stituted

1956 and 4.3%

your

search

tal

30,

compared with 10.5%

on

their
investment
re¬
administration, con¬
flicting factors as the slow decline

provides

1957, cash and
U. S. Government obligations con¬

k of Pr,ncipa|.

prospectus

common

stock position and increased the
holdings
of U.
S.
Government

return

wi,ho«'

1^

a

have

we

whose first

"

A

Govern¬

tion, National Investors Corpora¬
tion, and Whitehall Fund, Inc., by
which

Union Service Corporation,

Stein

of

presently

pamphlet report on
"The Business Situation" prepared
for
Tri-Continental Corporation,
Broad Street Investing Corpora¬

the near-term pic¬
discouraging, is typi¬
urged by the management

seems

cally

Fund's trustees,

Kingman,
Chairman,
Francis G. Goodale, and Albert T.
Armitage:

though

even

advantages of a hedging
likewise pointed out by

are

Henry

necessity for maintaining
important position in equities

an

It

The

stocks.

The

ing,

Loomis-Sayles, General
American, Knickerbocker Fund, review.
the Dreyfus Fund, U. S. & For¬
Of the 72 companies in our an¬
eign, the Massachusetts Investors alysis which report their common

NEW YORK i

ONE WALL STREET,

Others in the defensive

toward

sion."

vested in

decreased its net
by $9 mil¬
lion, or from 9.4% to 5.3% of net
assets.
Further, the National Se¬
curities

as

common

be

with a-significant
easing in the money market like¬
ly only in the event of a reces¬

portfolio continued to be fully in¬

and governments

cash

rates should

practical purposes that fund's

all

which

Fund,

the

interest

in

stable to rising,

hand, as Mr. Ran¬
chairman of the
sister trust National Investors, for

Aggressive

reversal of
trend of the March quarter.

curities

strong,

trend

On the other

dolph reported

underlying

maining

common

holdings resulted primarily
from gain in market value.

Ponds' Portfolio Policies
More

in

increase

relative

stock

ment

outweighs

certainties

or

orders may be
tain

activity.

ment

in

shorter-run

un¬

where government

expected to main¬
The Fund's invest¬

preferred

stocks should
by the eas-

be favorably affected

wlassac/wsetts Investors 1^rust

participate in the growth of
world demand for power
energy.

Energy
sold
no

For

at

sales
a

and

Fund

net

shares

asset

value

charge of

prospectus

information, write

any

V

Century Shares Trus t

.

are
.

.

.

Keystone Fund

eystone

Canada General Fund

kind.

LIMITED

giving full

Custodian Funds

to:

UJTe

securities, eacli Fund witlx

specific investment

OF BOSTON
i

—

i

A prospectus

A

Covering all classes of

Bond Fund

relating to the shares of any of these separate
be obtainedfrom authorized dealers or

or

Company
seeldng long-term
<

purpose

possible GROWTH

fully managed

.Mutual Investment

a

CAPITAL GROWTH in tbe

For RESERVES, INCOME

-

of Canada, Ftd.

^

expanding Canadian Economy

investment funds may

Prospectus from

VANCE, SANDERS & COMPANY
111

DEVONSHIRE

STREET

Tke

RALPH E. SAMUEL & CO.

BOSTON

(DISTRIBUTOR)
Members N. Y. Stock Exchange

HEW
61

115

Broadway, N. Y. 6,




N. Y.

YORK

Broadway

CHICAGO
Ilo

South LaSalle Street

LOg ANGELES
no

Weat Seventh Street

50

your

local investment dealer

or

Keystone Company of Boston

Congress Street

Boston 9, jMass.

Volume i£6

Number 5660

The Commercial and Financial Chronicle

...

occur^late-on "ateS WlliCh Sh°Uld

?exi«re many regardedIn the
fund signal. as a significant economic
"In

rmpratW f
operating from Boston.

occur later on.

An unusually forthright

,

sion

the

on

bearish

expres-

side

from General Investors

(493)

cases

the return

general

high

on

bonds surpasses the yield

comes

Trust, the

quality stocks

-

a

grade

picture

good

on

differing

evidence.

factor usually

portant

There

signals/

economic

trends

other

are

The

Quarterly Periods March

and June

in
im-

volume

Balance Between Cash and Investments of 74 Investment
End of

are

of

business

and

Governments?

-End of—

Open-End Balanced Funds:
American Business Shares

Axe-Houghton Fund

June

securities

many

earnings

3,692
4,093
3,772

A

3,629

from

standpoint

Continued

Com. Stks. and Lower

June

Portfolio Securities

may

22

page

Ot this: Portfolio

Other than Governments

End of

"1

Total

Mar.

Common Stocks

Total

Total

Total

June

Purchases??

Sales**

51.6

225

878

None

447

1,576

1,747

13.2

13.6

3,796

9.0

8.4

38.7

36.7

52.3

54.9

3,629

5.4

4.9

34.8

on

-(In Thousands of Dollars)-

Grade Bonds & Pfds.

•

35.6

special situations which

vul-

Per Cent of Net Assets

Mar.

at the Sam<? tlme there

Security Transactions During
April-June 1957

Preferred Stocks*

June

^

,•

price-

a

appear

Companies

-End of

Mar.

a

.

are

Per Cent of Net Assets

End of

Mar.

reflect

1957

Net Cash & Governments?
Per Cent of Net Assets

Thousands of Dollars

somewhat nerable (with the offsetting pal-

slowed

businesses

squeezing of profit margins

Investment Bonds and
Net Cash &

has

many

21

51.2

Sales**

Purchases??

4

25.1

22.6

69.5

72.5

663

2,621

3,711

1,160
2,060

409

1,747
6,176

9.5

5.9

28.7

25.9

61.8

68.2

678

487

658

487

36

104

0.3

1.0

28.1

21.3

71.6

77.7

110

818

no

240

2,000

1.4

2.5

lf33.2

pi.o

$65.4

$66.5

10,276

8,621

4,067

1,814

3,756
1,907

1.9

1.9

20.3

19.2

Commonwealth Investment

77.8

78.9

5,584

3,411

9,403

2,167

8,148

7.9

6.6

18.5

19.0

Diversified Investment Fund

73.6

74.4

1,672

778

6,263

3,869

2,794

6,699
1,650
2,888

2.5

1.2

26.6

25.5

70.9

73.3

387

3,243

340

7.4

6.2

26.7

24.2

65.9

13,193

15,620

7.6

8.7

23.7

20.9

68.7

70.4

337

5,982

8,991

340

1,434

1,883

10.0

9.6

12.3

12.3

77.7

78.1

117

50

91

None

4.95

495

6.1

6.1

22.9

21.6

71.0

72.3

258

158

258

835

538

8.3

4.9

9.5

8.2

82.2

86.9

1,297

219

1,155

98

9,290

4,277

0.9

0.4

32.5*

31.8

66.6

67.8

499

55,648

32,117

22,510

13,175

178

8.5

2.9

27.1

30.6

64.4

59

66

Axe-Houghton Fund B
Axe-Houghton Stock Fund
Axe

Science &

Boston

Electronics

Fund

Broad Street

Investing,.

Dodge Sz Cox Fund
Eaton & Howard Balanced Fund.
General Investors Trust

69.6

2,140

„

118

820

N.A.

1,321

.

228

N.A..

'

Group Securities—
Fully Administered Fund
Institutional Foundation Fund...
Investors Mutual
Johnston Mutual Fund

....

1

.

158

66.5

443

320

Knickerbocker Fund

1,353

2,404

10.1

17.9

20.4

22.5

69.5

59.6

179

1,311

179

Loomis-Sayles Mutual Fund.....

1,311

8,626

11,243

15.5

19.4

26.9

25.7

57.6

54.9

Massachusetts Life Fund

5,175

6*360

2,256

4,710

2,779

3,169

8.5

9.1

31.4

26.3

60.1

64.6

Mutual Investment Fund.

2,468

1,402

1,259

1,393

9.5

9.4

11.4

11.7

79.1

78.9

2,568

1,504

National Securities—Income

1,073

7.1

2.0

9.2

8.9

83.7

89.1

4,167

886

1,672

New England Fund

1,676
1,383
5,054

6.3

.6.3

32.5

33.1

61.2

60.6

2,295

2,286

9.9

30.5

29.3

59.6

60.8

840

924

724

705

4.3

3.5

25.1

23.1

70.6

73.4

10,075

5,959

4,419

3,042

2.1

37.9

31.3

59.5

66.6

; 3,176
1,375,

3,011

George Putnam Fund

1,390
5,942

Scudder, Stevens & Clark Fund..

.

1,838

...

9.9

1,490

2.6

765

1,443

4.1

7.4

21.3

21.4

74.6

71.2

Stein Roe & Farnham Fund

1,00/

I,y30

8.6

10.2

3U.3

8o.i

55.1

56.7

723

Value

3,796

37.8

34.8

20.3

18.7

41.9

46.5

342

6.5

1.8

1.1

0.6

92.4

97.6

8,830

4,035

41,100

39,430

6.9

6.3

29.6

29.0

63.5

64.7

46,223

29,339

243

177

3.0

2.1

43.5

44.0

53.5

53.9

'820

48,581
2,629

46,366

13.4

12.6

0.5

0.5

86.1

86.9

12,463

9.8

5.7

0.6

0.5

89.6

3,698

1,591
5,109

11.5

14.8

None

88.5

85.2

3,423

3,981

7.1

7.8

5.4

7.9

87.5

84.3

1,073

813

7.6

5.2

6.8

6.5

85.6

88.3

2,849
2,327
7,204
3,464

28,024

30,315

13.4

221

1,130

902

4,792

3,280
1,295

Line Fund

1.

Value Line Income Fund

Wellington

Fund

...

....

Whitehall Funcl

885

3,553
4

249

Shareholders' Trust of Boston...
'

156

1,388

'

3,782

Nation-Wide Securities
-.

1,879
2,022

,

1,761

;

1,022

241

848

1,628

2,008

112

474

r

135

_

701

28,383

3,878
24,727

726

38

317

11,984

12,463

1,718

2,823

8,561
•

Open-End Stock Funds:
Affiliated Fund

...

Blue Ridge Mutual Fund:

Bullock Fund

Delaware Fund
dc

...

i

Vegli Mutual Fund

Dividend Shares

13.8

None

0.05

86.6

86.1

2.0

18.6

None

None

98.0

81.4

10,640

12.3

12.3

None

None

87.7

87.7

53

65

1.6*

1.5

None

None

98.4

98.5

23,62.9

14,604

9.4

5.3

4.6

3.4

86.0

91.3
98.7

99.95

1.6
0.9

0.05

650

9.6

2.5

u-4,M83

11,639

3.2

4,053

17,072

4.3

18,755

20,178

'1.7

1.8

2,231

6,064

827

505

-

7,749

2,971

'

651

567

•2,337

Incorporated Investors
Investment Co. of America...........

.

Massachusetts Investors Trust........

•

7,058

5,143

None

None

93.4

None

1

'

None

99.1 '

2,951.

2,951

1,649

3,229

4,967

1,729

380

1,003

380

9,286

25,716

9,286

7,265

,14,786

v

"

-

7,265

408

734

5,194

2,202

734

;

-

•

•

'Massachusetts Investors Growth Stock-

.'

•

1.3

7

128

6,194
1,319
7,058

2,973
■

'

5,671

5,968

Corp..
Group Securities — Com. Stock Fund

11,984
1,718
2,949

5,357

1,969

408

Fundamental Investors

General Capital

-

2,250

6,344

1,649
6,748
1,003
25,716
14,786

Dreyfus Fund

Energy Fund
Fidelity Fund

2,949

5,252

2,424

9,529

...

Eaton & Howard Stock Fund

-

None.

93.8

None

90.4

4.2

0.6

0.6

96.2

95.2

8,731

16.8

1.9

None

0.2

None

95.5

83.2

4,680

None

None

98.3

98.2

37,824

26,189

18,890

a9,599

a3,864

9,599

1,092

•

97.5
•

None

None

98.1

95.7

None

None

98.7

99.3

None

None

-93.9

7.2

5.4

87.0

19.9

2.4

2.0

78.5

78.1

4.5

None

None

98.5

95.5

18.7

0.9

0.2

82,1

81.1

♦96.2

•

4.3

„

2,202

5,1.94

8,731
4,680

7,572
4,990

•

-

•

-

:
.

'

'

7,572
4,822
7,052
3,864

'

National Investors

-

National Securities—Stock
Pine Street Fund.

...

...

...

T. Rowe Price Growth Stock

1,691

1.3

0.7

:

6.1

2.3

4.9

-

19.1

1,950 <

.

'

-

-

4.1

-

'

■

90.5

L092

8,673

3,332

-1,340
8,673

682

539

506

136;

452

287

; i,i56
4,792

4,59*

1,84.9

97.7
,

•

-

.

452

.!

•

287

-

-

3,332

Scudder* Stevens & Clark—
Common Stock Fund

217

1.5;

732
-

10,653

Sovereign Investors

24

:

12,642
r

17.0

•

42

'

1.3

2.1

.....
'

United. Accumulative Fund..

•

...

22,743
10,682

United Continental Fund.....'.

-

1,650

United Income Fund

13.9

9.0

6.1

4.3

335

96.3

29

None

29

None

85.7

86.3

11,300

$$10*056

11,30#

81.4

II,117
18,259
3,049
9,012
4,753

6,391

15,077

5,785

997

6,380
2,413

3,049
8,024
4,753

6,380
2,413

1.6

"

13.3

8.2

22,939
13,1091,255

15,116

0.4

2.5

"
"

State. Street Investment.-

-

335

I,156
20,752

"

Sclcctc-d American Shares

0.4

9.6

81.0

1.0

1.1

92.9

94.6

0.8

1.4

94.5

94.7
93.3

10.8

.

.

•

-

979

6,354

4.7

2,535

5.7

5.7

1.2

1.0

93.1

137

4.9

1.5

None

None

95.1

98.5

424

•322

4-24

322

166

290

1.4

2.4

8.9

7.4

89.7

90.2

504

459

416

248

4,472

4,270

4.8

645

589

661

846

3.6

598',

252

1,752

1,349

Carriers & General

1,101

General American Investors..'..^....

3,843

General

2,012

United
V

Science

7,111

Fund

Value Line Special
Wisconsin Fund

Closed-End! Companies:
Adams

,

American

i

European Securities
International

Public

Service

Lehman Corporation
National

8,245

Shares

reporting
cash

and

1.0

0.9

94.2

94.7

645

589

4.4

20.7

16.0

75.7

79.6

699

1,033

4.5

3.3

1.6

1.5

93.9

95.2

468

639

2,675

6.6

15.0

2.7

7.2

5,160
2,392
10,539

5.9

7.3

1.8

1.6

92.3

91.1

567

3,800

467

7.3

8.9

None

None

92.2

91.1

1,222

1,919

1,222

96.2

95.7

8,407

10,583

8,407

1,919
10,422

•

3.6

1,941

3.0

17,142

2.1

1.7

87.9

1,782

1,300

$$1,683

$$1,190

3.0

2.7

91.6

93.3

590

481

523

481

589

347

589

§11.6

§12.3

§86.8

§80.6

377

3.4

21.6

19.2

75.4

77.4

16,344

12,267

7,036

4,525

13.0

None

None

88.7

87.0

14

3,620

14

3,620

315,702

:

11.3

..

427,276

so

included

by

been

investment company.
End-of-Mareh figures shown for net
governments and for investment bonds and preferreds have

partly

stocks:
(or

revised

Moody's

Aaa

approximate

through

equivalents)

305,322 "

irrespective

of

quality
assets.

classification.

rJCommon

SUMMARY

Open-End
Balanced
Stock

Minus

Companies
Funds

_

_

Funds

_

_

17
14

4

7

4

1

Net cash, etc., and

5

13

Totals




29

35

io

31

31
12

,

;

Securities,

;

74

and

Risk

Securities

Mar. 31, 1«)"m

Defensive

bonds and

7.0%

Governments-:-—

securities

lower grade

June 30, 1B*>~

7.1%

(investment
12.5

preferreds)

Risk securities

Closed-End Companies

Defensive

Total

Approx.
Unchanged

9

by 74 Companies of Assets to Cash and

Average Allocation

Equivalent,

221,728

stocks only.
§Ia
percent of gross
*?Cost of purchases.
**Proceeds from sales,
^Estimated.
(a) Exclusive of corporate short-term notes.

.^Investment bonds and preferred
Ba for bonds; Fitch's AAA through BB
for preferrcds.
tfBonds and preferreds

accordingly.

Changes in Cash Position of 74 Investment Companies
June 30, 1957 vs. March 31, 1957
Plus

3,800
.

450,455

11,278

412,600
where

639

N.A.

*

7.3

5.4

13,511

notes

0.1

N.A.

2,758

1,201

91.0

^

sliort-ferm

77.8

90.7

468

4.0

10.0

2,013

9,651

corporate

0.2

4.2

■

Grand Total
eluding1

4.4

2,494

...

U. S. & Foreign Securities

In

v

'

Securities

Tri-Continental

*

\

2,454

Niagara Share
Overseas

453

■

Express

American

2,227

i

Situations.

3.9

'

11.6

80.5

81.3

(common stocks plus

bonds and preferreds)

u

and Financial Chronicle

The Commercial

22

Continued from page

Draper, Sears Adds
(Special to Tub Financial

Mr.

Young was formerly with Keller
& Co. and Lyons & Shafto.

well

a

timely

BEFORE

POLICY TOWARD
INDUSTRY GROUPS

your

investment dealer

rather

TELEVISION-

shares

are

than

on

revealed

as

\

volume

of

companies.
industry

groups

bullish¬

eliciting

drugs, finance companies,
food, insurance, machinery, paper,

banks,

public
and

Television Shares

tires; and, to a lesser degree,

arid retail trade.
Predomi¬
nantly
sold
were
airlines and
natural gas. A mixed attitude was
evinced
toward
aircrafts,
auto
coal,

Management Corpl.

building,

parts,

115 Broadway, New York 6, N.Y. |

chemicals,

con¬

electronics,

glass,

and

tainers

III.

metals,
office
equipment,
oils,
railroads, railroad equipment, and
tobaccos.

|

Name

steel

radio-TV,

utilities,

-

I

'

T

and

of

Interna¬

and

quarter. Six manage¬
bought the former issue,

the previous

with

only

one

liquidating

fund

of its holdings. Three man¬
agements bought Harvester, two

part

with

intial

with

Credit,
there

nance

no

the

Fi¬

buyers
Pacific was newly

only

Mutual in
25,000
shares.

Investors

by

amount

Traders

Pacific

and

were

sellers.

acquired

of

a Canadian com¬
completely liquidated

Finance,

was

Blue

the

and

Ridge

Fund, with

Bought

In C. I. T., Com¬

tremely popular.
mercial

pany,

commitments.

Automotives

was

The finance companies were ex¬

by

Jfota Q/or/c

Investors
51,300 shares.
outnumbered
buyers
in
Davis

Parke,

Mutual which added

_

tional Harvester carried over from

ments

Among the buyers

Finance Companies Popular

Equipments Liked
Deere

newly

was

&/seent/

moderate
ers.

More

Three each attracted a

purchasers in the auxiliary lines,
including Borg-Warner, Briggs &
Stratton,
Kclsey-Hayes,
Sellers
predominated in Stewart-Warner,
Thompson and Tim ken.
Bunks Get

Latest Semi-annual Report
Stockholders

to

a

Fund, with no sellers,
by Investors Mutual
Affiliated Fund
(17,900) and by the Eaton & How¬
ard Group (3,300).
Great Ameri¬
can also was bought by Affiliated
Fund

consciousness

of the earnings ef¬

fects from the

rising

money

rates,

in

off

Find

issues

General

Dairy.

Af-

Mutual.

Investors

and

added

to

completely

was

Income

Fund;

West Indies Sugar was

and

closed out

Florida Power was bought
including Lehman, Funda¬
mental, and General Public Serv¬
ice, and sold by Pennroad. Public
Service E. and G. was acquired
by

HOW TO GET INVESTMENT FACTS

Co.

&

ABOUT THESE
Members T^cw

MUTUAL FUNDS

to

□

stocks selected for

Vegh and Eaton
Fund, with the
Putnam
Fund
a
small

no

Phoenix

closed out by

was

Group newly, with

Co., making

Southern

sellers.

no

buyers, including

5

highs, was bought by 4 man¬
agements (principally M. I. T. to
the extent of 25,000 shares) and

new

General Public
bought by

with no buy¬
Among the life companies,
Travelers
was
again
the
most

sold

popular, with three buyers, State
Street,
Commonwealth
Invest¬

Securities, with Lehman
selling 30,700 shares and Penn¬
road 12,714.
Issues in which sell¬
ing predominated included Niag¬
ara
Mohawk, Florida Power &

two

managements,

ers.

ment, and Putnam; and no sellers.
Machinery

Industrial

and

Equip¬

ment Accumulated

Babcock

&

Wilcox,

atomic

the

flavored company, which
rights offering in April,
let the parade as the most widely
acquired issue in this group, with

by

none.

Utilities

newly

was

Mutual

made

Light, Potomac Electric, Pacific
Gas, and Union Electric (by Na¬
tion

Wide

State

and

General

a

Street).

Telephone

was

newly acquired by three manage¬
ments, with no sellers.
Joy and
Worthington were also popular,
the latter bought newly by Fidel¬
and
Selling

represented the only issue sold by
American Business Shares during

Fund,

ity

Mutual

Wheeler

Foster

sellers.

no

National

Investment

was

Shares,
Fund.

predominated in Cincinnati Mill¬
ing and Caterpillar Tractor, al¬

though

I.

M.

T.

appeared

liberal buyer of the

Papers

as

Well

20th

cyclical

publicized
Crown

buyers

and

Service

Public
Life

two

Fund

with

and

the

new

purchasers. Mead was bought by
4
managements, including State
Street and Fidelity and sold by 1.
Kimberly Clark
funds

and

Rayonier

sold

was

was

by

investing in

The

Dreyfus Fund is

a

mental

Investors-Diversified

to

grow

make

common

vestment,

and

made

were

Investing
,

mutual

in

by

State

eliminations

Street. New

England Fund, and Overseas Se¬
curities. New buyers of CBS."A"
were Dividend Shares in the Bul¬

bought by 4
while

lock

liberally purchased

Group

vestment

and

of
sold

and

Fund.

Mutual
Axe

sold

"B"

funds

Trade

were

retail

moderately

trade.

-

bought were Allied Stores, Mont¬

Group

with

sold,

a

gomery

curities

on

Ward (with National Se¬
Income
making a new

acquisition), R.

complete

H. Macy, Feder¬

ated, Woolworth;; Associated

close-out by the Investment Com¬

pre-

stocks.

possible long -term capital growth
as:

Why not look into
The PUTNAM FUND
an

—now

Ask your

electronics,

chemicals and atomic energy.

Investment Dealer for Free Prospectus

containing all the facts,

or

mail the coupon below.

Prospectuses and other infor¬

and takes what it

mation

on

these mutual funds

Name

Putnam Fund Distributors, Inc.

available from local invest¬

that direction.
ILLUSTRATED BOOKLET

ment firms—or

(PROSPECTUS)

FREE FROM YOUR DEALER OR

.

.

Broadway, New York 4




checkmark your

60
Address

Please send
City arid State

27

HUGH W. LONG AND CO., INC., Elizabeth 3, New Jersey

CM A

Congress Street, Boston

preference above and mail
this ad to:

.

DREYFUS Corporation
50

as
Investment?

your money

considers sensible risks in

Well-

bullish

stocks selected for

including such industries

^

In¬

group

and Farnham

Roe

Retail
The

the
The

their holding.
CBS
by State Street.

Stein

part
was

agements, 2 of them (Fidelity and
Shareholders'
Trust
of
Boston)

Fund, Inc.

common

In¬

Commonwealth In¬
Eaton & Howard

Stock Fund. Complete

none;

Diversified Growth Stock Fund, Inc.

□

was

Stein Roe

Management,

and Farnham,

hand,
Chemical
Fund
disposed of 21,800 shares.
St. Regis was bought by 4 man¬

Investing in bonds selected for income.

fund in which the management

hopes

balanced list of bonds,

Manhattan Bond

□
UNO-INC

a

bought

as

vestment

other

the

Buying

purchased

newly,

seven

General

Massachusetts

comprising

was

by
Value Line
well as United Income
Fund, with no sellers. ABC-Para¬
mount
was
acquired by Funda¬
also

overproduc¬

sellers,

Some

Broadcasting

Storer

sellers.

Most popular was

Zellerbach,

Attracts

Century-Fox

newly by the Value Line Income
Fund and the Axe Group, with no

Bought

their

tion tendencies.

quarter.

a

paper

continued

Putnam

by

Radio-TV

latter.

product is¬
popularity,
the face of the industry's welland

the

the years.

ferred stocks and

1

newly

and Penn¬
road, with no sellers; while ATT
was
liberally sold by 7 manage¬
ments, including 3 complete elim¬
inations, by Pennroad, Eaton &
Howard Balanced fVnd, and Del¬
aware
Fund.
Incidentally, ATT
acquired

Diversified Investment Fund, Inc.

□

and

Fund

Investment

Group

energy

heavily

possible growth of capital and income
over

the

disposed of 35,500
shares and Lehman 5,000 shares.
International
Paper
was
quite

Fundamental Investors, Inc.
common

5

new

Funds

a

as were De
Howard Stock

Funds

Investing in

managements, including a
acquisition by the Axe Group
tune of 20,259 shares, and
sellers.
Houston Lighting and

by

newly. On the other hand. United

Yorl( Slocl{ Exchange

42 Wall Street, New York

7,

found

was

mis¬

money.

Power

S.

On

Rhoades

quarter,

previous

givings over inflation and dearer

United

buyer of U.

anty,

the

by 4 managements/including In¬
vestors Mutual with 38,000 shares.

Carl M. Loeb,

-

in
the public
as

utilities continued to weather

Fidelity & Guar¬

likewise

in

their

and Nation¬

Foods

Swift

Line

Popular

Still

not as popular

Although

large

filated Fund

Paper

Favor

liquidated by Wellington and the
Value

shares),

Putnam

popularity of the previous quar¬
ters. Armour, Corn Products, Gen¬
eral
Mills,
and
Nabisco
found
only
buyers,
with
no
sellers.
There was an approximate stand¬
al

Fillip

Apparently reflecting increased

available

Food

group.

bought

(23.600

buyers.

no

Foods

preponderance of buy¬
pronounced were the

this

„

Fireman's

sues

The Big

in

buying

Blue Ridge.

sellers.

no

of

Sellers

Buying

^^City-State

by

best

was

Mead Johnson.

INDUSTRY GROUPS

Agricultural

issue

Next in
popularity
were
Bristol - Myers
and EJi Lilly, the latter attracting
4
buyers,
including Wellington
Fund newly with 35,300 shares,

BOUGHT

| Address

The

«

and

the

seller.

their previous
quarter's popularity, as one of the
best
bought
groups.
The
most
widespread interest centered on
Merck with 7 buyers and only one
seller.

operating. results,* fire
casualty companies enjoyed

pointing

George

Drugs in Favor

bought

ing value and possible rate hikes
an
offset to the recent disap¬

as

&

Drugs continued

autos,

equipment,

farm

ness:

FUND, INC.

|

new

were

involved.

following

The

ELECTRONICS

135 S. La Salle St., Chicago 3,

Corn

Chemical

Bullock
Group,
and
of
12,000
Our analysis of specific port¬
shares
by
the
United
Income
folio changes, drawn from this
Fund. On the other hand, Invest¬
study's tabulation covering over
ors Mutual was a substantial sell¬
400 common stock issues, is pri¬
er
of
New
York
City
banks,
marily based on the number of
while adding to its holdings of
managements buying or selling,
out-of-town banks and insurance
the

DECIDING

get the booklet-prospectus and
record of this Mutual Fund
from

spotty

if

good

bought by Affiliated Fund,
commitments
of 9,500
made in this issue by the

were

and

suggestion

.

Utilities

Public

reflecting
their
well below liquidat¬

availability

of

shares

13,025

buy¬

two new

as

of this issue. *

ers

Popular

buying, including Chase, Chemical
Corn,
and First National City.

ft

ft

#

appeared

Apparently

enjoyed

banks

ad¬

Stocks Moderately

Insurance

Vegh and New England

De

Fund

Aggressive

further

in

participate

vances')."

investment

Funds
Fund.

Funds' Poxtfolio Policies
More

of
America,
the
United
Group and the Delaware

pany

Vegh; with

Chronicle)

—

and Boston Stock Exchanges.

Bullock Fund and De
no buyers of these two

the

by

21

issues.

Frank
L.
Young II has joined the staff of
Draper, Sears & Co., 50 Congress
Street, members ol' the New York
Mass.

BOSTON,

|

1957

Thursday, August 1,

...

(494)

Name.

Address.

me

Free

a

Putnam Fund Prospectus.

Dry

Number 5660

Volume 186

Goods
in

On the
predominated

Jawel

and

other

Tea.

sellers

hand

May, Penney,

The Commercial and Financial Chronicle

...

(April

,f>.

Firestone

this

Bought

and Tires

Rubber

>

Issues

buying,

with 5 managements
including Investors Mu¬

tual,

Fundamental

group,

& Howard

Eaton

stitutional

and

Dodge
sellers. Goodyear

Cox, with no

and

Common

by Scudder
and
completely

Fund,

eliminated

by Knickerbocker.

U. S. Steel

issue

in

its

State

No. of

No. of

No. of

No. of

No. of

Trusts

Trusts

Shares

Shares

Trusts

Agricultural Equipment

6(1)

Deere &

72,700

5,200

1(1)

6,000

the other hand, holdings were re¬

Wellington and Drey¬
fus. Republic was newly acquired
by Eaton & Howard Stock Fund
by

of 5 buyers; with

Carriers &

Harvester

None

None

1

None

None

1(1)

3(2)

Aviation

General

650

Dynamics

4

28,967

North

3(1)

26,300

Boeing Airplane

3

11,800

None

Aviation

American

United Aircraft

34,560

KLM

3
None

4

15,f00
17,000

4(2)

American

Eastern

Lines

United Air Lines

Briggs

1,500

Ford Motor

1,480

None

hone

1

Ford

14,900
5.000

1(1)

Mack

2

28,800

2

4,000

Trucks
Motor

Stewart

5(3)
Natural

Gas

was

sold

by 7 managements, with the Bul¬

Group

making

elimination.

Invest¬
complete

Mutual

and

Fund

United

a

Eastern

Panhandle

Shares

Service,

only buyer.
by General

elimination).

General

This

group's
demand

relative
Natural

the

issue

Gas,

was

Public

only
was

but even
completely

Street

State

by

40,525

1

400

and

Service.

the

weakness

prospects

and

group

with

1,000

Spencer Chemical

1(1)

and

KD

2(1)

2,000

Vitro Corp.
American Cyanamid

of

Bank

Hooker Electrochemical

Bank

Hanover

Olin-Mathieson

1

Marine

Midland

450

1

of

2(3)

128,1C0

3

8,000
3,590

2(1)

"Victor

3

27,900

2

4,347

_

Flintkote

1

6,400

American

None

None

4,600
1,900
16,600
II,300
5,000
1,200
4,700
10,200
1,300

1,300
1,900

6

2
4

KD
2(1)

3

3

KD

1

1
1

2

6,600

7,775

Ideal

2,300
21,700
29,600
1,500

2(1)

8,800
100

1

2(1)

4,100

2

28,700

.

._■■

_

Missouri

Portland

Gypsum

on

page

24

For Income

_

..

.

_

Elevator

3(1)

1

3(1)

14,900

1

2,600

1(1)

_

Cement

r.

S.

Pipe &

U.

S.

Plywood

3,000

2

1,250

Lone

Cement

Star

_

_

Lilly

Robbins

—

Pfizer

Parke, Davis
(Chas.)

_____

— _

Drug

2.200

1

2

__

Mead

5,000

1(1)

500

3(2)

20,000

Consolidated

6(2)

27,000
3,400

International Tel.

Electrical Equipment

& Electronics

1

KD
None

■

None

3(2) 1

1

Clark

I-T-E

3(2)

1(1)

5,500

Litton

3,300

1(1)

Electrodynamics-_

1,300

2

Tel

None

Controller

Circuit

—

&

Continued

INC.

Office and Order Room

Phone

of America
60

East

Hew

42nd

York

17,

Avenue,

1-2272

Tarrytown,
•

MEdford

N. Y,
1-4612

Teletype Tarrytown, N. Y, 1708

Street

N.

MEdford

Y.

Branch
730
Hew

Offices

AVENUE

FIFTH
York

19,

NATIONAL DISTRIBUTOR




Fhonei

CO

N.

Y.

5-0250

15

STREET

WILLIAM

New

York

Phonei

HA

430

N.

Y.

Beverly

2-6962

Phonei

5,

N.

DR.

CAMDEN

C

Prospectus from

Philadelphia 3, Pa.

I.

Hill

#>

BR

2-8253

a

\

1(1)

1,800

Industries

Prospectus and Literature

INVESTORS PLANNING CORP.

None

6,000

Breaker

ELECTRONICS CORP.

Benedict

2(2)

Schering

1

3(2)

5,000

8,500

KD

AXE HOUGHTON STOCK FUND,

Head

None
None

16,800

Johnson

2

^

400

None
None

Vitamin___

U.

AXE HOUGHTON FUND B. INC.

from

2(1)

64,900

Sterling

1

^

and

2(1)

1

____

Smith, Kline & French

AXE HOUGHTON FUND A. INC.

SCIENCE

1(1)

____—______—

1,700
6,000

2(1)

@

AXE

t,

None
1,000
5,500
3,000

"B"__—
&

Merck

Warner-Lambert

None

3

None

2,000

(Eli)

McKesson

S.

1(1)

8,200

3,500

GENERAL

TRUST

3(2)

:

AXE

INVESTORS

32,600

__

__

9,900

10,000

American Radiator

3(3)

_.

Glass

Bristol-Myers

5,300

13,000

Yale & Towne

2(1)

35,961

Abbott Laboratories

2(1)

None

2,500

4(1)

5,100

__

Owens-Illinois Glass

2

KD

2,000

None

_

__

2(2)

1(1)

16,100

Corning Glass

1

1,600

8,000

Foundry

None

50,000

_

Works
Owens-Corning Fiberglas

1

4(3)

None

Glass

Standard Packaging

1

4,500

_

Trane
U.

Libbey-Owens-Ford

18,500

_

._

__

KD

15,000
2,700
37,000

._

Can

2

None

Penn-Dixie

Hocking Glass

Pittsburgh Plate

2

Glass

Can

Continental

1

1,000
4,525

—

20,060

Cement_____
__

1

divergent

_

7(1)

3(2)

500
_

National
Otis

None

40,000
2,000

7,000

Cement—

___■

..

1

1,000

^Johns-Manville
Masonito

4(1)

1

17,000
33,400

22,000
61,000

•___

—

Cement

None

18,100
10,273

__

_

____

2(2)

2(2)

4(1)

Drug Products

4(1)

None

_

Anchor

1

None
—_ —

2(2)

2

200

Portland

General

2(1)

__

None

Distillers

Cork

5

16,700
27,600
1,755

Coke

Pittston

42,000

American-Marietta

2(1)

12,500

Island Creek Coal__—

3,400

Gypsum
Carrier Corp.

Chemical

16,750

Corp.__

Bestwall

.

21,000

_

Armstrong

Haas

3(2)

2(1)

cut-backs,

equip¬

National

_

4(1)

Building, Construction and Equipment

33,765

into

Continued

talk

Coca-Cola

:

Coal &

34,060

(N. Y.)

3(3)

46,258

._

_

2

Chicago

(N. Y.)___

6(2)

10,079

5,500

_

Freeport Sulphur

&

None

14,300

American Potash & Chemical__

Rohm

None

None

—

I,000
18,100

2

None

2

Beverages

2,500

2(1)

5(1)

aircraft

ran

National

4,300

.__

—

2(1)

1

None

United Carbon

None

None

_

Union Carbide

Koppers

2(1)
None

11,500

Sulphur.

Containers &

Chemical Corn Exchange Bank_
First

Chemical

None

1

None

None

None

Bank

Manhattan

Guaranty Trust

disarma¬

for

actual

some

aircraft

ment

None

6,000

First National City Bank of N. Y.

2(1)

Consonant with the outcropping

ment

Chase

10,800
10,000

1

improved

None

3,660

None
2

None

Chemicals

4,100

34,000

1

Aircrafts

market

1

1,300
3,500

None

_

___.

1

2

1,600

12,000

Thompson Products
Timken Roller Bearing

3(1)

2

MIXED GROUPS

of

Pennsalt

KD

2(1)

11,400

Chemical

Monsanto

2(2)

3(1)

1,200

i.

None

2

3,600

3,000'

______

3

4(1)
4(1)

1,672

_

None

1,450

*

of Canada

Warner

3(2)

Tri-Continental,
American Inter¬

national, and the Value Line Spe¬
cial
Situations
Fund
(complete

eliminated

1

with

Fund,

the

Express,

here

None

None

None

_

KD

1

sold

Was

Public

in

_

_

1

1

700

Interchemical

2(1)

1

34,300
19,870
18,000

__

Hercules Powder

Stauffer

KD

Ltd

_

None

Texas Gulf

3,000
_

'

_

4,500
1,000
1,800
10,000

10,000
2,000

_

Du Pont

19,000

2

Dye____

Chemical

2

2

Delaware

Gas

Southern

8,800
2,200
6,900
2,900
30,000
83,824
9,500

Dow

2(1)

by Affiliated

sold

was

Adams

issue

1,204

_

___

__

Columbian Carbon

Banking
Gas

Natural

National

(Holdings)

300

4

None

Motors

Dutch stock.

and

;

_

Kelsey-Hayes

24,000

Borax

4(1)

2,000

.....

—

_

13,500

Chemical &

8,500

2
___■

General

Allied

2(1)

Parts

and

Borg-Warner

29,500

Air Reduction

13,900
7,959

40,000
5,216

__

__

_

Gypsum__

42,300

Airlines

Air

& Stratton..
2,000 0 Chrysler
Eaton Manufacturing
1,100.

2

in
American, Eastern, and United;
with buyers taking over only in
the
newly
issued
KLM
Royal

Fund

S.

Lead

None

2

3(1)

buyers

2

8(1)

Royal Dutch

Automotive

3

Airlines

2(2)

2

Airlines
-

2(1)

SOLD

3

2

10,100
5,900

6(1)

4(3)
2(1)

65,500

__

2

4(2)
4(1)

30,000

Lockheed Aircraft

11,000

':

2 '

17,400

None

I

3

INDUSTRY GROUPS

None

._

2

000 shares.

Pipe Line

U.

6,600
8,500
3,300

Minneapolis-Honeywell

Chemicals & Fertilizer

Garrett

2,500

ment

8,700

5

7,000
34,400

31.800

lock

3(1)

4

21,450

I

Paso

2(1)

15,800

1

2

2

El

National

None

Bendix

2

exceeded

1,880

2,500

5(2)

1 of 2 sellers, making
elimination.
Bethle¬

was

Sellers

3

Bell Aircraft

freshly bought bv Dodge
& Cox and New England Fund.
Fidelity
Fund
acquired
72,000
shares through conversion of de¬
bentures, subsequently selling 17,-

as

complete

hem

1

2,000

Aerojet-General

15,700

General,

600

'

2(2)

a

1

Co.

International

4(4)

Street,

duced

-S old-

—Bought—

No. of

Shares

with 7 buyers

Fund in that order of volume. On

1

-Sold-

No. of

Shares

Aircraft and Aircraft Equipment

Selected American
Shares, Investment Company of
America, Massachusetts Life
Fund, Eaton
&
Howard
Stock

as

—Bought—

31 c)

Purchasers included

and 2 sellers.

'

June 1957)

No. of

the most popular

was

group,

—

transactions

Trusts

Steels Acquired

v

which

acquired

newly

was

Investors,

Stock Fund, In¬

Investors,

in

by more than one management group occurred. Issues which more managements sold than
bought are in italics. Numerals in parentheses indicate number of managements making entirely new purchases or completely
eliminating the stock from their portfolios. (Purchases shown exclude shares received through stock splits or stock dividends.
Changes through mergers also disregarded.)

in

favorite

the

was

23

Changes in Common Stock Holdings of 57 Investment Management Groups

Sears.

ana

(495)

1(1)

on

page

24 2

24

The Commercial

(496)

Continued

Continued from page 23

Mitchel, Schreiber Admit
Mitchel, Schreiber, Watts & Co.,
20

Broad

of the

Exchange,
Joseph

admit
Palmich
to
general
and Anna H. Watts

A.

Elsa

Stock

York

B.

Schreiber

(Special to The Financial Chronicle)

Fla.—Allen R. Barrett,

Gerald F. Laughlin, Brooks

Brink

P.

Hugo

Reed,
joined

have

the staff of Alfred D. Laurence &

Co.,

Southeast First Avenue.

201

this issue

on

by Selected American Shares. On
the other hand, 20,000 shares of

National

sold by M. I. T. A
attitude
was
continued

mixed

was

in

investment

shares)

and

Investment

by Commonwealth
(1,000 shares), with

of

amounts

$'J0

additional

an

INVESTORS

Lone Star Cement, Minne¬
apolis-Honeywell, National Lead
and
U.
S.
Gypsum,
Sellers of
tor,

Jrree of Pennsylvania Personal Profteriy Tan

FUND

MUTUAL

vesting

in

in-

froup of securities selected
possible long term
or

growth of capital and

Stock.

,

income.

Star

Lone

Cement

completely eliminated
Send for FREE Prospectu#
from your Investment
Dealer

holders Trust of Boston, and
The issue

land Fund.

was

lar

stocks Rey¬

favor, with Selected American

Shares making a new acquisition.
On
the other hand,
Aluminium
and

Alcoa

sold

were

bal¬

on

with chief sellers of the
being United Fund Group

State Street.

and

was

Alcoa

was

com¬

end

also

Carriers

and

r,

4 5

TITLE

LAND

General

was

&

an

bought

10,

lington

split and rights offering.
24
managements on the

(newly), Putnam, United

Pine

Street

Axe

and

three

side,

Stock

Bowes

with

Fund, who made

bought

was

no

sellers.

Multigraph
Chemicals

Register

Here the most favored issue

was

Monsanto, whose buyers included

shares.
Pont

Mutual
Next

and

making

a

favored

Reduction,

Common
new

Selling

chiefly

in

of the

Hooker
Olin

predominated

American

Cyanamid,

Electrochemical, Koppers,

Mathieson

(eliminated

Investors Mutual and

The favorites

Haas

Fund)

by

Mutual In¬

and

(completely

Rohm

eliminated

this

in

area

were

by

(with Wellington buying

with

Oil

a

commitment of 24,100 shares,

bought by

was

Investors

the

to

Husky

Incorporated

tune

of

of

76,100

a

commit¬

new

shares

in

Royal

tention

INVESTMENT FACTS
about

an

stocks presented

approximate stand-off.

other

Texas Co. elicited the at¬
of

fiber¬

buyers with

ers.

On the

hand, the glass and

5

.

In
ers

no

sell-

glass stocks, with the exception of

;.. a

supervises

a

m

Here
were

diversi¬

portfolio of American
securities, selected for the possibility of
term

current

GROWTH of capital—and

of

tric.

the

Investors

Mutual

address

acquired

on

coupon

8,400

Best Foods
Corn Products Refining__

None

None

General Foods
General Mills
National Biscuit
National Dairy
Swift

None

None

West

2(1)
2

9,500
10,800

2(1)
1(1)

6,500
9,500

Indies

—

Sugar....

—

1(1)

5,000
1,400
1,600
1,000

3

44,800
29,445
2,700

3

7,500

1

200

2

3,200

3

3,850

3

13,650

None

None

Aetna Insurance
Aetna Life
Connecticut G^eral Life
Continental Casualty
Fireman's Fund Insurance.
Great American Insurance
Hartford Fire
_____

1

1—

of 50,000

shares,

Accumulative

In

on

as

__—

22,500

_

1,000

Maryland Casualty
Travelers Insurance
U. S. Fidelity &

16.000
None

Guaranty

objectives

with
on

its

page

3

46,000

5,000




—

Chicago

—

1

2(2)

360

36,562

7,536

2

4,700

2

5,200

3

11,100
2,800
1,000

3(3)
1(1)
3

4,000

4(3)

12,400

12,800

None

None

10,000

1(1)

Allis-Cbalmers

31,500
1,000

3(1)
1

None
471
14,000

None

20,000

1

6.600
None

2

American

Chain &

Cable

Babcock & Wilcox
Beckman Instruments
Chicago Pneumatic Tool

^Combustion Engineering
Dresser Industries
Foster Wheeler ;
Ingersoll-Rand
Joy Manufacturing
Worthington
Caterpillar Tractor
Cincinnati Milling Machine.

21,000
None
3.360

1
1

None
1(1)
None
1

14,000

3(2)

1.500

2(1)

7,000
2,000

2

Metals and Mining-

2(1)

4,200

5(1)

21,200

6(1)

36,800

3

4,100

4(2)

34,800

2(1)

6,000

2

17,675
15,900

Algom Uranium
American Smelting & Refining
Anaconda
:
Cerro de Pasco
Climax Molybdenum
Consolidated Denison Mines
Falconbridge Nickel
General Cable
—___

None
None
15,600
2,500
None
1.000

1

None

None
1

1(1)
None
1

of
WmrnMmmmmmmmmmmmmMmmmmmmmmmmm

i
Mutual Investment Funds

•

25„-

•

Bond Series

Balanced Series

26

C

of

this

Preferred Slock Series

•

upon

Series

Stock Scries

Dividend Series

Growth Stocks Series

Fund

request

Lord, Abbett & Co.

«.

1

2(2)
None

1,900

Information Folder and

Prospectus

on

Request

NATIONAL SECURITIES & RESEARCH CORPORATION
Established 1930

New York

1(1)

Air Products

120

State.

1(1)
1(1)
None
None
1(1)

Machinery and Industrial Equipment

2(2)

I

long-term capital and
growth for its shareholders.

Prospectus

j Address_

1
None

3,100

Insurance

did the United

Fund

possible

income

Nome.

2(2)

Phillips, Wel¬

Continued

Investment

I Informationme free prospectus andother !
Please send
SELECT ED AMERICAN I
| SHARES,
CF-5

8.150
None
None
300

____

Phoenix

400

»

Lincoln National Life

Common Stock Investment Fund

are

500
None

——__

Home Insurance

Fund
A

18,400
4,400

Insurance

Affiliated

and

None
1(1)
None
2
' None
None
1
2(2)

9.400
None
None
10.000

—

• Income

beiow and mail to

|

None
9,500
None

Armour

1,500

<•

name

2(2)

lington closed out its commitment

36,400 additional shares of West¬

135 S. LaSalle St., Chicago 3, 111.

CUy

predominance

California, Sunray Mid-Conti¬

Selected Investments Co.

j

3,750

1

of prospectus and

other information—fill in

I

a

Louisiana Land.

Westinghouse Elec¬

1

8.900

2

nent, Shell, Sinclair, Phillips and

outstanding favorites

ITT and

-

"A"

INCOME.

—for FREE copy

\

balance.

Electronics

fied

long

on

were

Electrical Equipment and

inc.

mutual investment fund

which

liquidation occurred in Union Oil

sold

AMERICAN

SHARES

sellers; while

Glass,

-

1

None

slightly outnumbered by

Libbey-Owens-Ford

SELECTED

5,000
None

3

3

•

the "favorite" Amerada, buy¬

were

None

1.500

51,000

acquisition of 45,000 shares.

Wellington made
ment

None

None

Finance

Finance

1(1)

None

—

Finance

Traders

shares, and by Fidelity Fund via
new

—

—

_

Commercial Credit

Pacific

2(2)

Food Products

1

sellers appearing.

no

&

Containers and Glass
container

Household

2

Dutch.

The

8,500

1

McGee, where Wellington made

Putnam).

Why not Get the

1

None

3

4.000

Family Finance

Cash

31,000 shares), Socony, and Kerr-

a

vestment

National

sold; Lehman, Wel¬

Oils

new

former.

funds

Du

Fund

acquisition

8,000

9

Group

Stock

2

by

latter's liquidation.

4,664

were

17,100

2

2(1)

lington and Whitehall sharing the

Gulf Oil

Air

Securities

with

4

None

3

3,800

..

Addressograph-

and

were

Wellington with 73,500 shares, and
Investors

C. I. T. Financial

buying
ac¬

.

.

Investment

Associates

37,600

3(1)

18,700

Companies

1,000

3(1)

4(1)

51.000

6,000

2

first-time

made

acquisitions.

new

Square D

Of the

quisitions, namely Fidelity Fund
Fund Group, and T. Rowe Price
(with
14,000 shares),
Delaware
Growth Fund; and Yale & Towne Fund, and Wisconsin Fund. Pitneyby

...

Sprague Electric

1(1)

IBM, of course, was the "big
noise" in this group, following its

Affiliated Fund
and
Commonwealth Investment; Trane
by Fundamental Investors, Wel¬
by

wood,

8,000
19,123

—

None

1

-

—

Sperry Rand

None

1

20,000

_

Electric

(P. R.)..

None

1

Office Equipment

vestment

PA.

General

Mallory

None

2(1)

by Knickerbocker and Mutual in¬
Fund.
Issues
bought

BAILEY & CO.
RLDG., PHIL A.

1,500

Westinghouse Electric

Na¬

Shares, while Tri also
important seller.

tional

without sellers included U. S. Ply¬

GEORGE A.

None

1

11,000

Instruments

Texas

1

2,000

_

_

_

pletely eliminated by the closed-

sold by Blue Ridge and New Eng¬

or

by Lehman Corp.

Among the alminum

former

Share¬

by

crop¬

nolds Metals encountered particu¬

ance,

Ridge, with a complete elimina¬
tion,
and
National
Securities-

weakness

of

the

conda, with National Shares mak¬
ing
a
new
commitment;
and
American
Smelting,
purchased

Ltd.

Blue

American Radiator included

diversified

a

face

out in

for the first time

Radia¬

None

Sunbeam

1.500

_

_

Finance

price of the red
metal, copper issues were fairly
well bought.
Favored were Ana¬

Construction

American

included

the

ping

Issues in which sellers predomi¬
nated

A

and

1

Corp.

1

ment.

Building

1,200
1,000

Metals
In

or more.

SOVEREIGN

2

Radio

2

Ben-

Aviation
commit¬

National

with

Group,
making

accumulated in

19,600

buyers in this issue.

no

newly bought by Tri-Continental
(25,000 shares) and by the Bullock

systematically

Trusts

2(1)

2

along with Massachusetts Life
Fund.
General
Dynamics
was
may

Shares

completely liquidated by Invest¬
Company of America (50,000

mx,

Share*

Shares

23,000

quired by National Aviation, Bul¬
lock Fund, Stein Roe & Farnham,
and the Value Line Special Situa¬
tion Fund. National Aviation also
first

No. of

Trusts

3

Electric.

ment

a

No. of

previous quarter toward
Square D was

the

General

Sold

No. of

67,800

from

23

page

No. of

6(1)

Aerojet-General found only buy¬
ers.
The latter was
newly ac¬

made

from

August 1, 1957

Chronicle... Thursday,

—Bought—

inghouse, where there was also a
new
acquisition of 14,400 shares

policies

liquidated,

Alfred Laurence Adds

and

Aggressive

the part of fund man¬
agements.
Boeing,
Douglas,
United and Lockheed were sold.
In the latter issue 2 managements

Aviation
closing out its entire commitment.
On the other hand, Bendix and

partnership.
Mr.
Palmich
will
acquire a membership in the New
York Stock Exchange.

MIAMI,

More

limited

to

Financial

Changes in Common Stock Holdings of
57 Investment Management Groups

will

8

Aug.

on

partnership
and

New

Funds' Portfolio Policies

City,

New York

Street,

members

and

Atlanta

—

Los Angeles

Broadway, New York 5, N. Y.

\

Volume 186

Number 5660... The Commercial and Financial Chronicle

—Bought—

Sold

(497) ' 2&

Sold

—Bought—

No. of

No. of

No. of

No. of

No. of

No. of

No. of

Trusts

No. of

Shares

Snares

Trusts

Trusts

Shares

Shares

Trusts

12,800

2(1)

2

4,000

Inspiration Consol. Copper__

9,000

2(1)

2,500

Kaiser Aluminum

3

9,/ 50

Kennecott

3,250
2,500
8,000

Magma Copper

3
2
1

Miami

13,o55

58^500

Roan

Antelope Copper

3(2)

25,900

U.

Foil

3,500

Ventures Ltd.

3(1)

1,600

2

American

Natural

1

Republic Natural Gas

20,900
2,000

Southern Natural Gas_______

1(1)

2

25,600

3(2)

2

3(1)

3(1)

&

Gas

9,000

1,000

500

3

8.000

United

Gas

Electric

Columbia Gas System
Columbus & So. Ohio Electric-_

2

2,000

Consolidated Edison

1

2

2,000

Consumers

3(1)

5,400
58,286
3,000

20,000

El

7

20,365

Florida Power

3

7(2)

10,800

General Public Utilities-

2

None

IBM

Gulf

18,000

Paso

7(2)

2

2(1)

5(1)

2

2

9,500

Idaho

3(1)
2

2

8,000

Illinois

4(1)

3

Pitney-Bowes

None

1

27,000
8,625

;

None

Electric

States

Houston

None

Addressograph-Multigraph

770

National Cash Register___

1,000

9,950

Utilities-

Lighting & Power

Power

Interstate

3,300

4(2)

Atlantic

73,100
25,000

1(1)

None

None

20,300

Middle

1

Montana Power

1

29,100
3,000

2(1)
5(1)

45,500

2(1)
3

4(1)
1

Cities

1(1)

10,000
31,750

1(1)
9(2)

Service

Continental

__

Gulf

Oil

1

6,500
12,100

Home

Oil

Husky Oil

4(1)

96,000
2,500
28,201

2(1)

7,000

2(1)
2

Oil

27,300
28,317

2,000

1

4

Southern

None

None

2(1)

18,500

Southwestern

9,300

2(1)

8,100

4(1)

II,000
24,400

10,000
None

1(1)
1
None

45,788

2

1
1

5

1(1)
1(1)
2(1)
None

5,300

2(1)

None

None

Mission Corp.

1,500

1
1

15,100

1

5

33,500
35,044

Development
Monterey Oil

7,000

2(2)

Ohio Oil

74,400

3(2)

3(1)

83,700

1,600

2(1)

2(1)

6,900

Royal Dutch Petroleum.
Seaboard Oil

19,500

7(1)

&

'

___'_

South Penn

(Ind.)
Oil (N. J.)

37,000
20,400

Texas Co.

2(1)

28,500

Texas Gulf

2(1)

34,300

Texac Pacific Coal & Oil

5(2)

39,400

5(1)

None

Standard Oil

British American

None

None

1,000

1

500

2(1)

Pure
Shell

Sinclair Oil

5,000

None

None

1

Sunray Mid-Continent
Superior Oil (Calif.)
Union Oil of Calif.

30

None

Oil

None

None
None

22,300

6(1)

4(3)

21,700
82,700

4(1)
2(1)

760

28,100

5(4)

2
4

Dayton

Florida Power

None

None

New

1

None

1(1)

30,300
47,500

Mead

4

4(2)

19,700

St. Regis Paper

:__

2
4

Marathon

Corp.
Corp.
Rayonier

Ohio

1,000

3

6,000
21,300
11,000

2(1)

Light

Edison

______

—

None

None

None

Union Electric

31,800
19,600
14,500

t

(Mo.)

3
2(2)

2(1)

2(2)

KD
3

2

2(1)
1

30,550

General Telephone

35,000
4,000
1,300

Peninsular
American

Tel. &

None

—.

Telephone

GROWTH

None

3,000
38,100

Tel

1(1)
7(3)

Prospectus from

today

4

41,300

Amer. Broadcast-Paramount

2(2)

24,500
12,300

Columbia Broadcasting

2(1)

"A"____

24,500
23,744
3,000

—

7,000

Motorola

2

3,000

Paramount Pictures

2(1)

4,700

Storer

2(2)

10,500

1

500

___

Broadcasting

20th Century-Fox

Zenith Radio

3(3)
2

INCOME

and

None
None
3,300

...

-

MANAGEMENT CORPORATION

1

Dept.

2(1)

None
None
3(1)

CFC-54,

120 Broadway, New York 5, N. Y.
Please send

Aberdeen

Fund

Prospectus

Railroads
Name

29,900
7,600
38,300
1,000
2,500

Atchison, Topeka & Santa Fe—

Denver & Rio Grande

3(1)

11,800

2

Chicago & St. Louis
&

2(1)
1(1)

1,500

Great Northern

Norfolk

16,550

Southern Railway

4(2)

35,000

1,000

Union Pacific

4(2)
1

on

State..........

1

21,950

Continued

.

None

30,000

—

.

2(1)

None

Southern Pacific

City

1

73,400

Western

15,000

4

Street

None

6,000
4,000

Chesapeake & Ohio

N. Y.,

2

None

Baltimore & Ohio

54,200

3

132,400

2

For GROWTH..,

to:

—DAVID L. BABSON—

page

26

Massachusetts

Life Fund
A balanced mutual fund

For

dealer

your

mail coupon

Radio, Television and Motion Pictures

2

40,500

FOR

LONG-TERM

or

3(1)

None

DESIGNED

POSSIBILITIES

3(1)

None

FEND

Public Utilities—Telephone

2(1)

None

HARR1SBURB

ABERDEEN

2(1)

17,000

Electric

PORTLAND

BANGOR

HARTFORD

2(2)

39,010

Peoples Gas Light & Coke—___

6,000

3
3(2)

6,700

—

Pacific Gas & Electric
Pennsylvania Power & Light.—

26,000

1(1)

10,800

Light___.

&
&

BOSTON
NEW YORK

None

1,320

Niagara Mohawk Power

Potomac

3

2(2)

18,000
2,600
:

Power.

England Electric System__

None

4

None

Great Northern Paper

4,000

Power

None

4(2)

5,800

Kimberly-Clark

Electric

None

2(1)

Crown Zellerbach

5,300
33,400

Electric.-

Penn

Wisconsin

None

1

15,100
1,600

West

None

2(1)

Service—

Tampa Electric
Virginia Electric & Power

2(1)
4(2)

Paper and Paper Products

7(2)

Public

None

None

Co.

None

1

None

South Carolina Electric & Gas__

1,000

1

23,400
9,100
6,000
145,600

Oil

2

Gas & Electric

None

None

21,500

i__

3(1)

4

None

Phillips Petroleum

1

3(1)

None

Louisiana Land & Exploration__

4,000

1
None

3,000

Oil

3(1)

San Diego

1(1)

83,800
None

—

Joseph Light & Power

1

None

Amerada Petroleum

None

1

(Ohio)

Producing

3

3

None

30,400
14,200
25,400

3(2)

1

3,000
16,000

13,500

Oil

Standard Oil
Standard

None

2,500

Gas__^

Socony Mobil Oil--

4,000

5(2)

Oil

Skelly Oil

19,200
5,300

2

3

None

Shamrock Oil & Gas_

Signal

Founded 1898

Southern California Edison

Kerr-McGee

700

1

2(1)
1

International Petroleum

8,000

Incorporated

7,000

St.

None

;

Coffin & Burr

1

Rochester Gas & Electric

Mission

1

None

10,000

4,500
33,000
8,000

17,500

2(1)

Indiana

22,500

18,400

____;

Oil

of

Service

None

None

2

1

5

Gas

2

3,000

"B"

Honolulu

Public Service Electric &

3

10,000

Oil "A"

2(1)

Philadelphia Electric

National Distributor

1

1

16,800

Home

Northern States Power

1(1)

3
1

2(2)

6,000
4,500
1,000

Getty Oil

3,500

18,000

25,400
39,100
4,200
None

South. Utilities

1,520

__

Delhi-Taylor Oil

51,000

Electric

2,812

_________

Oil

1

&

Puget Sound Power & Light____

2,000

24,200

Champlin Oil & Refining

2,700

Gas

Public

1

British Petroleum

34,300
10,464

Louisville

6,000

2(1)

1931

None

2,000

4

7,000

:

ORGANIZED

1(1)

None

4

Refining

Fund

None

Power

4

Oil

New England

None

Iowa-Illinois Gas & Electric

8,500

and

de

1

None

Power

2(1)

2

become

3(1)
1(1)

None

Long Island Lighting.

3(1)

and

Smith

Forest Smith" will,
limited partners.

Margaret

None

4,000

25,400
21,600

None

will

partner

2(1)

43,874

3(2)

Burroughs

None

10,000

1

24(3)

None

(N. Y.)

Power

None

2(1)

8,500

Exchange,

Forest

1

None

1(1)

34,000

the

general

de

1(1)

37,000

2(2)

Office Equipment

of
a

William

1

&

2

2(1)

on

None

14,254
5,000

2,500

Stock

Aug.
1
will be
changed to Cahill & Bloch, Smith
&
Gallatin.
H.
John
Bechler,

Exchange,

1(1)

1,000
4,600

Cincinnati Gas

36,240

providing

for distribution of income and prin¬
Now

in its

cipal in accordance with

20th year

ual trust account

an

individ¬

for each investor.

BALANCE
Investing in
C'.PITAL

KNICKERBOCKER

VENTURE

FUND

FUND
A

Mutual

investment
sis

on

Fund

with

program

income

possible long-term

For

a

balanced

with

empha¬

consistent

with

A
Mutual
Fund
investing in
Atomic, Electronic and
other
Companies selected for
GROWTH

growth.

or

Capital Venture Fund, write:

KNICKERBOCKER SHARES, INC.




diversified

>,

lnvestin§forashigh
current

selected
for their INCOME
and APPRECIATION
securities

[as

with tho
risk

possibilities.
Prospectus on

Prospectus

Request

INCOME

possible' commensurate

on

fittearfte/ieffi

ffttbutatice

involved.

20 Exchange PI., N. Y. 5

C/Co$/ii/afOCt'/e
ffotn/tettty, Trustee

Founded 1818

Request

Prospectus from

your

Investment Dealer

possibilities.

Prospectus and other information about

Knickerbocker Fund

&

None

None

8,500

Panhandle Eastern Pipe Line
Tennessee Gas Transmission

1(1)

None
28,300

Central & South West

15,800
15,600

Northern Natural Gas

5,000

None

Central Illinois Public Service

2,100
26,500

21,000

5,000

None

None

—

18,000

1

None

Cahill

of

name

of the New York

members

member

Gas

Carolina Power & Light
Central Hudson Gas & Electric

53,000

1

6(3)

Gas

Electric

2

9,600

Lone Star Gas

1(1)

Gas

2(1)

•

&

Calgary Power

13,300

1(1)

17,822

Consolidated Natural Gas
Natural

Baltimore

I.000

Louisiana

&

2,000
1,000

5

3(1)

20,400

Paper

3,200

Gas

2

firm

The

Bloch, 11 Wall St., New York City,

become

Arkansas

12,000
64,700

7,500

Oklahoma Natural Gas__,

Paso

4(1)

4(1)

1,000

El

3

4(2)

31,200

10,150

7,000

3,700
15,300

Corp...

International

6,500

12,800

Gas

Colorado Interstate

None

Bag-Camp

Container

Public Utilities—Electric

1

1

1

Union

15.000

None

Gas

1

None

3,400

2

5,000

1,900

1

2

31,000

_

Aluminum Co. of America______
'leant ssce Corp

300

None

None

_

Natural
2

None

None
_

Scott Paper

1

None

Aluminium Ltd.

1.600

4(2)

1,900

None

7,900

"B"—

2

6,000

2

None

6(1)

2

3

6,250

Copper

2

2

1(1;

3,600

Pnelps Dodge
Reynolds Metais
S.

2

2,000

_

Copper

1(1)

Cahill Bloch Smith Gallatin

or

MASSACHUSETTS LIFE FUND

Nationally

distribute^

though toveit/fieit

dealers

by' ^

Deiaware DTstmbutors Inc
300

Broadway

•

Camden 3, N. J. "

DISTRIBUTORS

•
50

State Street, Boston

9,

Mass.

Si

City Realty & Sees. Co.

Continued from page

'■*

securities

at

363

business

Fifteenth

Officers

More

Scott

Chandler,
President;
Kjar, Vice-President;
B. J. Rasmussen, Treasurer.

are

Andrew
and

000-share
tion

holding.

Only liquida¬

in

occurred

Oil

Union

of

California, chiefly from the Bul¬
lock
Group, which disposed of

Joins J. A. Overton
(Special to The Financial Chronicle)

Rails

Clark has joined the staff of J. A.

Overton & Co., 1134 Orange Ave.

In

the

carrier

Fundamental

and

man

Continued

from

T.,

Thomas

Securi¬

National

with Jones, Cosgrove

Ridge, and Bul¬

made

and

commit¬

initial

an

& Miller, 81
of

South Euclid Avenue, members

Fund).
Issues

Miscellaneous

mand

10,000

developed

—Bought—

American

rrusts

Schwabacher
years.

&

for

Co.

many

-Solu—

'

,

with

formerly

was

Lynch, Pierce, Fenner &
prior thereto was with

Beane and

Newmont

for

Chicle, Gillette, Hertz,

No. of

Thomas

Mr.

Merrill

Buyers appeared in a number of
unclassifiable
issues.-. Good
de¬

shares, and Pull¬
with 2 buyers and no sellers.
of

associated

become

has

A.

Calif.—Brown

PASADENA,

the Pacific Coast Stock Exchange.

25

page

Fund,

Stock, Blue

The

Favored stocks here were West-

Investors

I.

ties

-

inghouse Air Brake, in which Blue

Ridge

and

(Special tc T/te Fin.vst:*l Chhonicle)

predominated in American Tobac¬
co,
and especially
in Reynolds
(Value Line Income Fund, New

Railroad Equipment

In¬

Procter

Transamerica,

lock

ment

M.

Palmolive.

good

a

Blue

Southern, England

City

and Seaboard Airline.

vestors), Norfolk and Western (by

Mutual,

Kansas

Central,

group
buying
predominated
in
Atchison,
Baltimore
and
Ohio
(with De Vegh making a new ac¬
quisition), Chesapeake and Ohio
(by Investors Mutual,
Tri-Con-

managements

tinental

Sellers,
Colgate-,

in

,

curities Income, and Institutional
Foundation
Fund).
Sellers pre¬
dominated in Rock Island, Illinois

25,600 shares.

CORONADO, Calif.—Donald F.

showing

report

earnings increase, was the group's

Aggressive

R.

Shoe.

S;

buyers

issue

Funds' Portfolio Policies

from offices

Street.

U.

and

outnumbered

1957

■&/ Gamble,
Wrigley.
The
principally sold.
Chip, Minnesota Mining, had
3 sellers disposing of a total of
Tobacco
4,900 shares, with 2 new buyers,
The
present crucial smoking-; namely
Incorporated
Investors,
health
question was met by a and Eaton & Howard Scock Fund,
Axe
"A"
Fund), Union Pacific thoroughly divergent attitude by acquiring 12,700 shares.
Liggett
&
(by M. I. T., National Securities the fund managers.
and Pine
Street), and Virginian Myers and Philip Morris had buy¬
With Jones, Cosgrove
ers
but no sellers; while sellers
(by Pioneer Fund, National Se¬
its

sued

OAKLAND, Calif.—City Realty
and Securities Co. is engaging in

Mining

subsequently is¬

has

which

tion,

Transporta-

American

Genera]

24

(Special to Ths Financial Chronicle)

a

and Financial Chronicle... Thursday, August 1,

The Commercial

(498)

No. of

No. of

Shares

No. of

Trusts

•;

Shares
'

e°sc>pa>

Changes in Common Stock Holdings of
57 Investment Management Groups

^

Steel

—Bought—

5,100
17,400

Armeo

6(2)

60,700

Bethlehem

Steel

1

2,000

Cleveland-Cliffs

Seu

No. of

No. of

1

1,300

Shares

Shares

Trusts

1

1,000

Crucible

5,700
10,848

None

None

1

Virginian Railway

1

investrouSh
Z^nts

15,000

3,900
20,000

Kansas

KD

18,000

City Southern

__

Seaboard Air Line

Granite

2(1)
2(1)

18,500

Republic Steel

1,500

7

26,900
500

1(1)
2

st°cksC°n"r,°n

2,000

U.

EATON

&

HOWARD, Incorporated

24 Federal St., Boston, Mass.

1,600
1,300

American Brake Shoe—

1,700
5,000

KD

8(2)

40,400

KD

9,300

General Railway

3,000

1

Kl)

3,000

2,300

New York Air Brake

7,500

KD

6,500

Pullman

2

1(1)

2

_L_____

1

cfl

2,000

2

2(1)

4

17,100

General Amer. Transportation—

Allied Stores

4

11,600
3,500

Associated Dry

1

1,000

City Stores

2

4,000

Federated

2

7,910

2

_

_

Johnson

Saco-Lowell

_

_

2(1)
2(1)

900

None

100

Goods_______—

None

American

10.800

"B"

Tobacco

2(1)

1,800

American

Chicle

2

3,000

American

Optical

None

None

1

19,000

Grand Union

3,000

Kl)

1

7,600

Jewel

None

None

_

_

23,809

__

Department Stores—

Tea

_

4(1)

_

Gillette

73,100
5,500

Halliburton

R.)_

(W.

None

"None

1(1)

15,000

3(2)

15,825

Hertz

A Diversified Investment

None

Tea

None

None

2(1)

6,000

Woolworth

1

4,000

May Department Stores_

2

4,100

Penney (J. C.)__

2

32,500

1

700

(F.

1

1

2,000

-

-

,

W.)

2(1)

★

__

700

___

_

__

1

3(3)

2

Sears, Roebuck

5,200

Goodrich

5(1)

11,986

Goodyear

2

ADMINISTERED FUND
A Balanced Fund

10,060

U.

★

S.

,

_

500

_

_

_

50,000
12,700

Minnesota
Procter

1,000

14,400

____

High-Grade Bond Fund

•

&

3
2

None

Transamerica

3(1)

None

None

Wrigley (Wm.)

A hard

4,50ft

____.

1.600

mutual funds

hitting,

proven

selling aids

Diversified Bond Fund

ever

service planned to bring you more sales

all of these features:

Direct mail letters for your

Prospectus

Request

on

exclusive

use.

Monthly Letter and other special studies
you on top

on

these and

Distributors Group,

FAHNESTOCK

63 WALL STREET, NEW YORK

5, N. Y.




CO.

turn

to keep

aids

—

see* /

to help you

opportunities into sales.

Distributor

•

Incorporated

&

—

i

of all Fund developments.

The necessary sales tools and

Industry Classes write to

•

more

Unique sales campaigns tailored to your specific needs.
Continuous research and statistical data on Mutual Funds.

Prospectus

—

developed for investment brokers.

Offers you
©pn

123

South Broad St.,

ARTHUR WIESENBERGER & CO.

Philadelphia 9

Member#: N. Y. Stock Exchange

Telephone: KIngsley 5-3311

1

61

•

American Stock Exchange

BROADWAY, NEW YORK 6. N. Y.

3(2)

8.900

_

profits. The most comprehensive series of timely business builders and

A Good-Grade

1

None

2(1)

Safes helps that really help!

BOND FUND

Kl)
2

3(3)

How to sell

A Mutual Investment Fund

1

5,400

____

INC.

THE GENERAL

1

1(1)

Gamble

None

more

1(1)
None

4,900

21,900

FUND

★

1

4(2)

Mining & Mfg.--

Kl)

PHILADELPHIA

2(1)

40,700

Mfg.

m

BOND FUND

For

8.500
10.000

-

Filtrol

1,000

Rubber

700

Co I gate-Pa Im olive
Emhart

1

23,100

None

3.000

2(2)

_

Webster

2,500

1(1)

1

600

THE INSTITUTIONAL

A

&

2

None

None

Firestone

_

U. S. Shoe

6,100

Kl)

_

Rubber and Tires

3(1)

Stone

Marine

2(1)

2(1)

;

4,600

Mining

Outboard

500

1

3(1)

15,200

None

Shoe

Newport News Shipbuilding.

18,100

31,638

15,400

Newmont

3,000

10,500

_

2(2)

31,900

14,500

.__

Murray Corn, of America...

52,500

15,000

Safeway Stores

★

2,600

1

5,000

Oil Well Cementing

International

200

1

744

Hammond Organ

None

National

None

_____

Grace

1

None

Industries

Eastern

Montgomery Ward

4(1)

None
None

^

160

Macy (R. H.)

3,500

5(2)

Avon Products

l,0CO

1
1

3,900

3

Miscellaneous

Kl)

_

_

None

None

22.500

Tobacco

Reynolds

9,500

THE FULLY

1

None

_

9,200

5

KD
k

None

Philip Morris

2(2)

2

1

500

Liggett & Myers-

None

None

_

3,300
8,100
5,000
4,000

3(1)

GROWTH FUND

3d)

500

_

Shops

9,600

THE CAPITAL

2(2)

9.000

Johnson

&

STOCK FUND

16

6,500

__

American Viscose

Kroger

Companies

1

2

Youngstown Sheet & Tube

2

in Listed

2(1)

1,500

Tobacco

None

None

Brake

Westinghouse Air

Incorporated 1933

THE COMMON

2(1)

12,500

_

__

2

18,200

Car

2

★

None

24,000

None

None

Retail Trade

GROUP SECURITIES, INC.

None

14,000

"

200

1

Signal
—

Union Tank

6,000
12,000

3(1)

£l/ie 5 vfmicfa

■*

Kl)

American Steel Foundries-

1(1)

or

______

Steel

Mesabi Iron

.

1(1)

Textiles & Textile Machinery

2(1)

Investment Dealer

your

S.

1

1

Steel

Sharon

Railroad Equipment

Prospectuses available from

City Steel___

Jones & Laughlin._

2(1)

2(1)

12,600

_

8,000
15,100

5(1)

3(1)

24,100

Illinois Central

2

5

3,000

Steel

3(1)

1(1)

9,100

Chicago, Rock Island & Pacific.

5,000

1(1)

cfe</

17,000

Western Pacific

3

1.100

:

Copperweld Steel

1

larilv th" and
in

No. of

3(2)

21.500

Iron

3(1)

ofking

_

Steel

Trusts

?r°»th

Steel

__

No. of

^utsu9t

24.600

29,520
50.800

Ludlum

Allegheny

4(1)
5(1)

-Sold-

Iron

&

TELETYPE: NYl-420

2(1)
>2

Volume 186

Number 5660

The

...

Commercial and Financial Chronicle

('499>

Mr.

W.

Howard

Assistant

with

Bankers

and

OFFICERS; ETC.
}

The

First

National " City

walk

announced on July
1,973^.426 shares (98.7%) of
the 2,000,000 additional shares of
its capital stock which were of¬

•23 that

fered

to

share

shareholders

at

State

New;: Jersey,

$60 per

the exercise of the rights issued to
The rights expired

T.

The offering was under¬

sale

Montclair,

will

000

be

added

the

to

ital

will

funds

of

bank

will

alone

be

and including
capital funds of the City Bank
Farmers Trust Company, approxi¬
mately $34,000,000, the total will
approximate $730,000,000. This to¬
tal

docs

include

not

unallocated

of the bank of

reserves

than

more

$100,000,000,
Irving
York

Trust

Company,
the

announces

Cusack and

Maurice

Clarence

H.

Vion to Assistant Vice-Presidents
and

Eugene J. McCabe to Assistant
Secretary.
Both

Mr.

Cusack

International
Mr.

the

Vion

bank's

Division.

Banking
is

Cusack

assigned tc the
District and Mr. Vion

European
is

Mr.

and

with

associated

are

with

concerned

of

foreign business in New
and New Jersey.
Mr. McCabe is

an

of trusteeships and

York

administrator

in the

escrows

■

-g

■'

V.:

The

Bank;

Walter

elected

I.

York

and C.
Officers,
George F. Carse and Herman R.
Frenzel, Assistant Vice-Presidents
Russel

Trust

Guiltinan

Gerald

and

Hughes

Sigler

Perkins,

mour

and

Assistant

urers.

Sey¬

Treas¬

•
#

John

J.

i-i

Moynahan

has

been

elected

Assistant to the President

of

New

the

New

ard L.

York

Savings

Bank,

effective Aug. 5, Rich¬

York

Maloney Jr., President
on July 29.

an¬

nounced
'

'

■

.is

*s

if

and

elected

ings

Bank

York

of

the

City

Edwin

elected

Vice-President

and

J.

Sav¬

New

of

Hoskiris

Comptroller;

Robert

Weiss, Treasurer; Alice I.
Damseaux, Secretary, and Ian D.
Smith
Assistant Comptroller.
It
announced

was

Robert

by

M.

Catharine, Chairman of the Bank.
ft

0

0

National

Merchants

resignation

Van Sant. Jr., a

of Mr. Grant
Director and Ex¬

ecutive Vice-President of the Val¬

Bank and

Trust

increased from $2,000,000 to
$2,500,000 by the sale of new stock
effective July 12; and from $2,500,000 to $3,000,000 by a stock
dividend effective July 16.
(Num¬
ber of shares outstanding—150,000
shares, par value $20.)

Chicago's
be

23

a

building
home

V.

Trust

Chicago,

Bank,

ings

provide

Harris

for

skyscraper is
and office
an
enlarged

newest

Sav¬

and

111.

Kenneth

Zwiener, President, announced

that

the

stockholders,

bank's

at

a

special meeting held July 24, gave
their approval to the building pro¬
gram previously adopted
by the
board of directors.
The

building will be constructed

at the southwest

National

Bank

properties

cn

Zwiener

building

the

Various

bank

floors

the

at

and

on

departments

six

occupying

now

this

of

on

building at the corner

Monroe.

of

shortly

end of the property

the 16-story
of

start

two-story

south

that

announced

will

latter

building

are

moved temporarily to re¬
modeled quarters in the building
immediately west of the present

being

Harris Trust Building,

which

was

eight floors and basement areas of
combined buildings.
The top

the
for

building will be utilized by

bank

the

at

directors'

the

Board of Di¬

rectors, according to

an announce¬

by

Mr.

Chairman.

feld,

Auslander,

George

Mr.

Frederick

Hain-

Jr.,

President of the Long
Trust
Company,
Garden

Island

City, N. Y., announced the election
of

Mr.

dent

Van

as

a

Vice-Presi¬

Aug. 16. Mr. Van
charge of Branch
of the
Long
Island
#

Mooney,

dent of the Cohoes

a

By

a

^ *"

_

Effective
Bank

its

creased
from

July

capital stock

common

$400,000

outstanding
value $50).

National

the

16

Chicago, 111., in¬

Austin,

of

by

$500,000

to

a

(Number of shares
10,000 shares, par

—

The First National Bank of Kan¬

City,

sas

increased

Mo.,

Savings Bank,

0

if

stock dividend The Board¬




its

com¬

capital stock from $4,250,000
to $5,000,000 by a stock dividend
effective July 15.
(Number of
shares outstanding — 200,000
mon

value $25.)

par

Mr.

"

of

'

0

Joseph M. Dodge", Chairman
Detroit

The

Detroit,

Company,
nounced

ments

the

made

rectors

Bank

and

the

Trust

Mich.,

following
at

an¬

appoint¬
of

Board

Di¬

meeting July 23.

capital stock of the

common

announced

Bank

South

of

England,

London,

July 29 that:

on

Court sanctioned, ef¬
fective July 26', 1957, the Scheme
approved by shareholders at the
Extraordinary
General
Meeting

19, 1957, to reorganize
the capital structure of the bank
June

held

by:
(1) Cancellation of the uncalled

liability

per share on all
issued shares of£2

£1

of

million

5

each.

-

lion

new

(3)

£ 1 each.

shares of

—

President.

Berns, Rollo G.

of share Premium Account

and

allocated to the

previous

proportion of one
new share for each 25 held.
Thus all shares in the capital
of .the bank resulting from the
provisions of the Scheme, namely,
17,000,000 shares of £1 each, now
form one uniform rank.

D.

Roderick

partner in the
of Branch, Ca¬

Presi¬

dents and Assistant Trust Officers

to

conserve

to

cash

pay

5 Yrs. to

12/31/56.

Another

factor that

the

greatly

movement

in

in¬

invest¬

ment income is the

Boston

bell

Com¬

&

abnormal

conditions

of

heavy losses
for

losses

the

company

managers

when

invest¬

the

sales¬

offer

securities, "No, we have
funds except to pay for losses."

no

But

return,

Continental

as

a

company

such

has

Casualty

experienced

years

greater

Hanover

Ins.

Hartford

Fire

Home

a

in
far

the

serve on

point:

of

Premiums Written

Change

Invest

m e n

a

t

103

57

203

35

we

use

a

Casualty

179
78

32
—3

37

38

—

148
62

25

Ins.
States

18

96

35

Fire—

Casualty

127

135

24

__—

55

176

46

—

Relnsur.

213

13

51

Casualty—

86

307

Fidelity & DepositMassachusetts Bonding-

42

107

American

Surety

Continental

S.

Fid.

——

&

82

42
60

Guaranty

193

45

Surety

268

Bennett-Gladstone Adds
Chronicle)

ANGELES, Calif .—Herb N.
Jones and Robert Roth have been
LOS

to
the staff of BennettGladstone-Manning Company,

added

+17%

8417

+33%

increase,

showed

a

Beverly Boulevard.

Joins Mitchum, Jones
(Special to The Financial

percentage

dollar basis for the

83

53

Wash.

Westchester Fire
Aetna

220

"

Fire—

American

85

50
23

——_

___——

—

Iris.

United

170

44
41

(Special to The Financial

+70%

increase in premium re¬
ceipts and, on the basis of asset
size, Hartford ranks first among
stock companies; Insurance Co. of

the

Ins.

Paul

160

—

Fire

Security

U.

Net

greater

Board of Gov¬
ernors

Pacific

Phoenix

200

——_

Hampshire
River

89

55

No. America

Providence
St.

36

—

Fire

Seaboard

percentage

Continental

elected

been

New

North

190

23

—

Union

Northern

119

60

__—

Insurance

Co. of

197

35

American

out

or

210

28

Insurance-

Falls

increase
in
premiums written than other large
companies. The following brings
the

147

56

Springfield Fire

to

recent

35

—

Glens

National

insurance

119

—.—

Fireman's Fund

National

ment

192

31

Association

Fire

available

amounts
for
investment.
Many
security salesmen hear this plaint

114

59

Phenix

less-than-usual

funds

leave

143

26

Insurance

Great

Digressing briefly, it
pointed out that under

be

present

23

Insurance

Firemen's

investment.

185

Federal Insurance

strong rate of increase in premium
volume brings in more funds for
may

60

190

Shippers—

Continental

Fidelity

Whether

Rich¬
mond, Va., has

&

109%

53

——_

Ins.

growth in the
volume of premiums. Naturally, a

12/31/56

22
40

Agricultural
American

10 Yrs. to

34';,

Fire

Aetna

Bankers

fluences

pany,

Chronicle)

Calif.—Berwyn
W. McDowell has become affili¬
ated with Mitchum, Jones & TemLOS ANGELES,

650

pleton,

members

Pacific

South Spring Street,

of

Coast

the

New

York

and

Stock Exchanges.

Bankers

Association

of

America for

1957

NATIONAL

a

of INDIA,
Bankers

Conven¬
of

Roderick

D. Moore

West

former

is

present

a

Chairman

member of the

to

Group.

Joseph

H.

Fauset,

LIMITED

partner

13, St. James's Square, S. W. 1.
in India, Pakistan, Ceylon,
Burma, Aden, Kenya, Tanganyika,
Uganda, Zanzibar, and Somali-

I

Bulletin

on

Request

Branches

Reserve

in

BANK STOCKS

London, E. C. 2.
(London) Branch:

Protectorate.

CapitalFund

£4,562,500
£2,851,562
£3,104,687

description of
banking and exchange business.
Trusteeships and Executorships

The Bank conducts every

Steele & Co., Pittsburgh,
passed away July 24.

Quarterly Analysis

13 N. Y. CITY

Government la

Authorized Capital

Joseph H. Fauset

Second

End

Paid-Up

Fauset,

the

BANK

Kenya Colony and Uganda
Head Office: 26 Bishopsgato,

the

Association.

Messrs.

-

in¬

come.

land

Vice

investment

Casualty
1951
$115,657,000
1955
196,404,000
Hartford Fire
1951
$293,924,000
1955
343,446,000
Moore,
general
Ins. Co. of No. America
investment firm
1951
$203,505,000
1955
269,685,000

Executive Committee of the South¬

George B. Hefferan and James F.

Officers.

their

of

I.B.A'.

Gov. of
v

eastern

to Trust

not faced with marginal

are

Roderick Moore Named

at

-1—

held down because

are

need

relatively consistent; they do
not' seek marginal situations, and

hence

Continental

and

Department

the

of

losses;
have range it is

holders of the

in

Moore

Assistant

course, other factors enter
into the picture, too. In a
long bull

men

million fully paid

four

shares

Mr.

Simpson,

companies

Of

10

utilize it in paying up in full 160,000 shares of £1 each which will
be

Fisher, Joseph B. Fresard, Donald
Mandich, and John B. Watkins

when dividend payments by many

from

£160,000 out

capitalize

To

tion

Trust

standing

Ins.

the authorized
capital to its present figure £17,000,000 by the creation of five bil¬
restore

To

(2)

ning with the

Vice

as
a
result of out¬ holders as almost all companies
top management.
And gear their dividend payments to
it is logical that the more astute that portion of a company's profit.
the
top management, the more There are abnormal periods when
likely it is that the best available this is a less faithful rule-of-thumb
talent will be obtained to operate than
usual, such as at present

about

come

behavior

The High

term, begin¬

Assistant

200

in

is
Africa Limited,

three-year

Department

Messrs. J. William

307%

55

Hartford

lOYrs.

86%

Casualty

!;t

Standard

The

Mr.

to

5 Yrs.

Continental

but over the longer
Fla., was increased from $1,035,000
the general practice.
market in equities such as we
to $1,207,500 by a stock dividend
Thus the company that shows the
experienced in the current phase,
effective July 19.
(Number of
the companies that have concen¬ greater gains in investment in¬
shares outstanding—120,750 shares,
trated in common stocks have ex¬ come may well be expected to
par value $10.)
increase dividend
disbursements
perienced the best growth in in¬
if
0
vestment income. As, by-and-large, more frequently.
Bank of Texas, Houston, Texas,
The
insurance
following schedule gives
company
investment
elected Leslie Coleman, President,
managements do little investing the five-year and the ten-year
succeeding George A. Butler, who in common
increase in income from invest¬
stocks, except in the
was
named
Chairman
of
the
better grades of equities, it fol¬ ments of a number of leading fire
Board.
lows that the growth in income and casualty companies:
*

Emery J. Gesell, Assistant Cashier

Banking

sense

both portions of the business, un¬

Industrial National Bank of Miami,

to

to Assistant Cashiers.

Vice-Presi¬

Cohoes, N. Y„ died July 25 at the
-age of 89 years.
ft

guest

if

if

was:

earnings from under¬ Ins. Co. of No. Amer.
44
170
writing also show
better
than
Thus growth in premium vol¬
mon stock of the par value of $10
average results' so far as invest¬
begets
growth in income
each; surplus of $210,000; and un¬ ment income is concerned. There ume
from investments.
divided profits of not less than are a few
exceptions, but this
$66,487.
Income from investments is im¬
holds good pretty much through
0
if
if
the list, and, of course, appears to portant to
the insurance stock¬

R.

Company.

Peter H.

and

room

dining facilities.

be in

Operations
Trust

Sant

effective

Sant will

level

and

regrets by the

ment

floor

23rd

general

a

growth

£1

purchased by the bank last year.
Upon completion of the new
structure, scheduled for January,
1960, the bank plans to concen¬
trate all its operations in the first

of the

In

that the units that show the best

the

purchased earlier by the bank.

Trust Company, has been accepted

with

consol¬

to company.
it may be said

company

have capital stock of $365,000, di¬
vided into 36,500 shares of com¬

of Monroe

corner

Streets

Clark

and

stocks shows wide varia¬

surance

tions from

At the effective date of

story bank

to

0

Stream

ley

National

idation the consolidated bank will

The

was

to

By ARTHUR B. WALLACE

This Week— Insurance Stocks

with

derwriting and investment.

capital stock of the

stock dividend.

The

$200,000)
Wanatah

Ind.,

Michigan City."

the
The Trustees of the Dollar

of

the

Wanatah,

"The

of

Bank of

shares,

Bank

Company of Fort Wayne, Indiana,

Mr.

New

title

*

common

Lincoln

the

Co.,

Jr.,

City

*

demolition
Trust

trust

with

Reading, Pa.

Co.,

the

were

Trust

Corporate Trust Division.
Bankers

Braun

of

solicitation

the

the

Mercer,

K.

Directors

New

promotion of

became

of

Bank and Insurance Stocks

calpital stock of $60,000, consisting
of $25,000 common stock and $35,As was brought out in the case North America
third; Continental
000 of capital debentures. Effec¬ of price changes over a
five-year Casualty eleventh.
(Alfred M.
tive as of the close of business or a ten-year
period, the change Best Co. data, Dec. 31, 1055.) The
July 13.
The consolidation was in investment income among the percentage
gain in investment in¬
efffected under the charter and more active fire and
casualty in¬ come for these three companies

former¬

was

head

B.

James
Nicholas

the

Assistant

as

and

department of the Guardian Trust
Company in Cleveland, Ohio.
'

and

the

July 25 at
Reitinger came

1940

investment

Bank,

n g s

died

President

cap¬

8240,000,000,

$696,000,000;

.over

ly

su;--

the
surplus from $300,000,000 to $380,000,000. Including undivided prof ¬
its of over $76,000,000, total capital
to

in

i

a v

J.,

Bank

the

increased from $200,-

be

000,000

S

N.

President iii 1941. He

capiial

$80,000,000 to
With these changes the

plus.

the

to
to

formally com¬
pleted on Friday, July 26. From
the $120,000,000 proceeds, $40,000,was

of the bank and

its

Philip Reitinger, President of

the age of 62. Mr.

Corporation.

The

Atlantic

to

Montclair

the

written by a group of investment
bankers headed by the First Bos¬
ton

of

increased

capital stock from $1,$1,800,000 by a stock
dividend effective July 16. (Num¬
ber of shares: outstanding— 18,00A
shares, par value $100.)
500,000

shareholders.

July 22.

Bank

common

subscribed for through

were

National

City,

Bank

York

new

stock

common

consolidated

CAPITALIZATIONS

of

0

The Merchants National Bank of

NEW. BRANCHES
NEW

*

Michigan City, Michigan City, Ind.

CONSOLIDATIONS

RL'UlSED

Snyder to

Officer.

Trust
#

News About BAnhs

T.

27

also

undertaken

Laird, Bissell & Meeds
Members New York
Members
120

Stock Exchange

American Stock Exchange

BROADWAY, NEW YORK 5, N.

Y.

Telephone: BArclay 7-3500
Teletyper—NY 1-1248-49

Bell

Trading Dept.)
Specialists in Bank Stocks

(L. A. GibbSt Manager

(500)

Continued

from

page

will decline

3

about

credit

policy

Further

This

In the Investment Boom

market

basic

of

or

for

time

the

for

tight

relatively

being is

sup¬

recent

In

long-term

months,

security
issues
have
increased
sharply, and the amount of new
financing in the market so far in
set

has

1957

Cur¬

record.

new

a

loans

under

posi¬

still high and reserve

tions

of

ported

rather constant pres¬

the commercial banks have
necessity been more selective

sure,

of

operations.

their lending

in

for investment funds.

issue

new

tively

and there is little
strength of the in¬
through 1957 at

heavy
the

-of

doubt

vestment

The
rela¬

still

is

calendar

boom

least; capital programs and spend¬

policy of con¬
only

Underlying this

by the sustained high de¬

mands

time and again been a source
tne market place.

strain in

tinuing credit restraint is not

indicate

busi¬

that

ing

forecasts

ness

managements intend to keep
rate of outlays on plant and

demands have ap¬ the persistence of the investment the
parently been augmented by a boom but also the fact that busi¬ equipment on a high level, while
backlog of financing carried over ness sentiment has remained gen¬ the
steady expansion in outlays
from last year; it seems that more erally optimistic in 1957, and, in¬
on public works makes for a ris¬
and more corporate treasurers and deed, seems to have strengthened
ing volume of municipal issues
municipal authorities are reconcil¬ further in recent months. This is over time. The
huge volume of
ing themselves to higher borrow¬ all the more remarkable since new
issues
already
placed
as¬
ing costs and are now ready to some of the business news has
suredly raises a question whether
pay the going rate. Also, the re¬ been discouraging, Yet, despite the the
pace of long-term financing
cent
improvement
in
business sag in home building, cutbacks in will be maintained
through the
sentiment
may
have
prompted household appliances, disappoint¬
remainder of the year; the volume
borrowers to finance themselves ing automobile sales, price drops
of new issues may well recede in
now rather than risk even tighter
in some commodities, and a lower
the months ahead, and this could
credit and higher interest rates rate
of
steel
output, industrial
bring some temporary relief in
later.
production has eased only mildly the market
place, but the basic
In addition to the backlogs, new and
employment
has
set
new
situation continues to be one of
investment activity continues high records. Strength in general busi¬
demands for capital substantially
and rising. A greater volume of ness has thus added to the finan¬
exceeding the amount of new sav¬
public utility issues is a natural cial needs of the economy while
ings.
corollary of mounting capital ex¬ at the same time making con¬
Financing the Government—The
penditures in this industry. Petro¬ tinued credit restraint necessary
rent

capital

leum

companies have also bor¬
heavily in recent months;
the Suez crisis greatly stimulated
shipbuilding and tanker loans, and
acquisitions
of
new
leases
in
Venezuela have recently added to

to curb

Treasury

price inflation.
Ahead

Continuing Pressures
The

fluenced

credit

the

this

far

markets

likely to
through
the

year

a

that have in¬

broad forces

are

so

con¬

active
requirements for funds. Demands tinue
re¬
financing domestic pipelines, mainder of 1957. Business senti¬
service stations, and other facili¬ ment remains strong, capital out¬
ties have also been heavy. Finally, lays are well sustained, and in¬
in view of the huge rise in the flationary forces are still at work.
short-term, indebtedness of busi¬ In
addition, the Treasury faces
ness
in 1955 and
1956
and the further
and presumably greater
corresponding decline in business problems of debt management this
liquidity, the purpose of some year, and this may well have an
long-term financing may well be important
bearing upon the
for

refund bank loans and redress

to

climate of the market place.

current positions.
Pressure

The

economic

boosted
term

uted

Business Prospects—The

the

on

trend

Treasury
that

have

requirements for longfinancing have also contrib¬
,

to

the

debt

management

problems of the Treasury. In the
latter part of 1956, Federal

spend¬

ing especially for national defense
began to climb sharply — partly
because

of

rising costs—thereby
reducing the already modest cash
surplus. Toward the close of the
year, developments in the Middle
East

made

it

of

most

forces

necessary

for the
Fund to

has

the

entered

now

half of the calendar year,
time when financing require¬

second

rowed

the

business

situation.

credit

seasonal slack

ing
a

single

important

the

newed

appears

in

general
as the

factor

After

in

some

production dur¬

months,

summer

increase in

the

re¬

a

fall seems

good guess. As yet there is little

evidence of strength sufficient

to

give the

economy another major
thrust, but confidence i.s
buoyant, and most corporate man¬
agements, as well as many ecoii omists, expect an upturn in the
latter part of 1957.

upward

ments
tion

are

to

In addi¬
deficit of $6 bil¬

always heavy.
cash

a

lion, the Treasury faces maturities
certificates

of

of

amount

billion
the

Federal

wide

choice

in

notes

and

billion,

$24

which

of

the

about

$9

held outside

are

Reserve

The

banks.

of

high-yielding inment
outlets
in
the
corporate,
municipal and real estate mort¬
gage field incident to an invest¬
ment
boom
greatly complicates
the
Treasury's problems of re¬
financing maturities as well as of
raising
new
money.
Investors
have

no

incentive to

Government

their

add to

at

bond

attractive

sufficiently

a

However, such a decision
depress the prices of out¬

yield.
would

uncertainties

centuate

credit

bonds,

Government

standing

Capital—

for

Demands

outlook

credit

to bring

as

in the months ahead.

pressures

Credit and Interest Rates

rapidly

so

sustained easing either of

a

in

acthe

another

markets, stimulate

A
the
Treasury decided against making
an
exchange offering to holders
bond

ury

1955.

June

moverover,

ago,

F and G bonds designed

of Series
to

in

was

while

short

All

redemptions.

discourage

this indicates that the Treasury is

long-

undertake

to

inclined

not

financing in the current eco¬

term

environment.

nomic

Treasury's exchange offerings, and
unusually
large
amounts
were
turned in for cash.

All this resulted in
drain

substantial

a

the

on

Treasury's cash re¬
sources, and the Treasury had to
raise unexpectedly large amounts
of

cash

in

calendar

been

the

year;

the

first

half

of

the

previously, it had

pattern

for

the

Treas¬

ury's cash requirements in the
January-June period to be met
out of the
tax

disproportionately large

receipts

cumulate

at

that

normally

This year,
the Treasury borrowed close to
$6
billion of new money in the first

from

the

present,

in

an

environment

where

to meet its cash re¬

the Treasury,

of the

increases

wage

under

now

way, bringing renewed price rises
not only in steel, but
probably in

automobiles
take

hold

other

and

well. Should

as

in

industries

inflationary forces
substantial

a

way,

demands for funds would continue
to grow and would accentuate the

forces

tending

toward

tighter

credit and higher interest rates.

the

Government's

credit.

If

in¬

Assuredly, this prospect is not Treasury securities, it is not be¬
a

foregone conclusion.

conflicting forces

are

A

host

of

at work

at

cause

the

of

question

any

credit

of

the

regarding

United

States

complex econ¬
omy.
Rising costs may be mod¬
erated by higher productivity, and
price advances may be tempered

Government but because

second

half.
These large opera¬
required considerable sup¬
port from the commercial banking

by

nificance

for

tions

ness

tors,

demonstrated

idly, bringing cutbacks in invest¬

by
their
continuing purchases of fixed-in¬

system.

ment

come

half of 1957 and another
$3 billion
was
raised through tax anticipa¬
tion

bills

at

Federal

the,

start

of

the

times

in

Policy

the
Federal
Re¬
far in 1957 has continued

its

generally
restrictive
credit
policy. While the money market
eased appreciably for a few weeks
early in the year, this was fol¬
lowed by renewed tightness. Willi




a

our

competition.

Moreover,

expectations
programs

liquidation
Reserve

Meanwhile,
serve so

all

course

of

of

may

and

rap¬

additional

inventories.

events

busi¬

shift

would

Such
mate¬

rially reduce and might even re¬
verse
the upward pressures upon
interest

rates.

It

must

be

recog¬

tractive

yields

other

high-quality

faith

institutional

are

The

due

Treasury's

not

securities

inves¬

to

but

loss
to

of

the

ditions, the Treasury could doubt¬
less
compete
successfully
with
borrowers if the debt

agement authorities
offer

a

were

man¬

willing

long-term .marketable

the

to

hazards

the

long-range

growth of the American economy.
Prospective Needs for Capital—•
crucial

The

question is how long

capital goods boom is
likely to continue. Over a period
of years, investment outlays tend
to be a fairly volatile component
of our economy and projections
great

our

current conditions could

on

well prove

misleading in the years
Nevertheless, the weight

ahead.

demands for capital funds may re¬

securities, including tax anticipa¬
tion issues due in March and June

term.

1958,
and
perhaps
also
larger
weekly offerings of Treasury bills.
Such a financing program may

present evidence suggests that
substantial

the longer-

over

,

class

broad

One

of

capital

spending which is clearly in a
rising
trend
is
public
works.
be expected to provide outlets for Needs are large and backlogs in
corporate tax accruals and other some categories are still growing
near-term investment needs, but more rapidly than
can
be met
the

in

as

past the commercial
presumably
be re¬

will

banks

quired

substantially
securi¬

increase

to

current

by

Moreover,

programs.

construction costs are rising faster

than any other

major cost in our
All this spells growing

their holdings of Treasury

economy.

ties, at least until funds accumu¬
purchasers.

for many years

late with the ultimate
A

Federal

is that

therefore,

prerequisite,

the

avail¬

make

Reserve

able to the member banks the re¬

needed

serves

to

support

Treasury's

' operations,

confronts

the

with

and

the
this

authorities

credit

decisions

basic

some

of

policy.
Decisions

hitting

economic
basic

no

peaks

new

still

prices

Credit

for

Policy

—

dollar volume of output

With the

and costs and

pressing

the

higher,

indicates

environment

departure from a policy
However, since

of credit restraint.

the

Treasury
find

it

the

at

same

to

necessary

seasonal

assets.
Some

Questions for the

Much

of

the

Future

tightness
credit and capital markets
clearly reflects the fact that the
present

is the

economy
end

as

yet

seems

to

see

no

to the sustained business and

investment boom.

In such

en¬

an

capital requirements in this sector
ahead.
another

area of investment,
residential building, the
probabilities are that a peak has
been passed some time ago.
The
high rate of building, of recent
years
has
materially
reduced
housing backlogs, and large out¬
lays for modernization and re¬
pairs have further diminished the
urgency for new home building.
In addition, family formation has
been declining for a number of
years
and this
has apparently

In

namely,

come

to be reflected in fewer new

demands for homes.

and

disquieting prospects

long-term.
our

may

One

the
that

over

problem

is

ment, which is under strong, and
constant pressure to boost activity
through i public
housing^ slum
clearance, and direct financing. <
Perhaps the most critical—and
least predictable — factor in the
outlook

be

investinent

abroad..

tive factors

are

of

new

sav¬

are

signs
a

that

this

trend

corollary of

a

is

not

business

to

the

as

But

restric¬

also present, such

emergence

of

excess

ca¬

pacity, the inflated costs of con¬
struction
and
equipment,
the

profit margins in some
industries at least, and the greater

squeeze on

difficulties

As

costs

and

financ¬

of

sustaining
forces are uppermost; there are
few Signs of any sizable easing
of capital spending by business in
ing.

of

the

now,

Where the

the immediate future.

greater weight will lie over the
long run is impossible to say;
however, since investment pro¬
grams

their

it

in many industries
sights firmly fixed

have
upon

in the future,
probably would require a sub¬

goals

years

many

stantial

change

economic

climate

to

so

a

in the
bring about

contraction
as

in

strong
capital

business

to

reduce

of

total investment-

volume

materially

public and private—in our
omy.

Costs
to the

have

-

.

and

financing,

out

Also, it has become increas¬
ingly evident that financing needs
are
being enhanced importantly
by rising costs and prices; there

at work

are

keep the level of such spending
high and rising; these-include ex¬
pansion of population and. mar¬
kets,s the contribution: of scientific
research, pressures to cut costs,
and
growing needs for capital

financed

a

ings.

merely

forces

Powerful

business

trend of

plant and equipment.

on

ment

face

capital

the

is

spending

in the years ahead
persistent excess of
requirements above what

economy

sup¬

provided by the Federal Govern¬

outlays

difficult

some

Some added

buying interest.

the

raises

new

port to housing, however, will be

fews

years

Also, higher

houses have without
doubt contributed to the drop in

prices of

vironment, the record of the past

can

Even under present market con¬

to

prospects

its

on

obligations.
psychology of sig¬

securities.

in

obtainable

state of the market.

doubtful

economic

as

difficulties

other

that

are

Nor is inflation

nized, however, that present signs
a development
in the near future; on balance, it is

do not herald such

at¬

more

pressure

problems of certain

to relieve the

of

in¬

vestors today are reluctant to buy

constant

under

main

mate¬

constant

are

Reserve authori¬

the Federal

ties

quirements in the coming months,
short-term

other ob¬

on

and

fixture

Further¬

Government

Federal

the

more,

more

a

will rely heavily upon

flationary pressures.
Such bor¬
rowings
inevitably add
to the
liquidity of the banking system
ducement to redeem Governments
and of others, and thus provide
in advance of maturity.
some
escape from the operations
Although the problems of debt of Federal Reserve policy. The
management
are
formidable, it history of most of the postwar
would be misleading to suggest period
amply demonstrates the
that the Treasury faces a crisis difficulty—if not
impossibility—of
or, as some have put it, that in¬ controlling credit when the econ¬
vestors are losing confidence in omy is amply endowed with liquid

therefore,
dollar
measurements rially higher yields
provide a
may well be expanded as a result ligations

ac¬

that time.

much

modern economy.

our

based

Consequently, prospects are that

factors, such as rising
At the same time, the economy
International Monetary
ment opportunities, and most of money in circulation and higher
likely to feel the continued
redeem a large volume of Treas¬ is
the recent upsurge in premature bank loans, tend to tighten the
of
basic
inflationary
ury notes in order to raise funds strength
redemptions have been in these money market in the latter half
for the support of sterling. Early forces.
Indeed,
inflation
psy¬
issues.
Finally, there are some of the year.
seems
in 1957, redemptions of savings chology
widespread; the
$41 billion of Series E and H sav¬
prospect of a rising wage-costEssentially, however, the Treas¬
bonds
stepped
up
rapidly
as
ings bonds outstanding, and while
ury borrowings supported by bank
holders switched into other and price level is being accepted com ¬
turn-ins here have not been a big- credit are in conflict with the
more
attractive investment out¬ placently and is even welcomed
lets. Also, many holders of matur¬ in some
quarters. JSven if the problem so far, the overhang of aims of a restrictive general credit
so
large a debt payable on de¬ policy and tend to make more
ing Treasury securities, pressed by physical volume of business ac¬
mand is not a reassuring prospect
troublesome the moderation of in¬
liquidity problems, spurned the tivity later in the year should not
differ

but

of

of borrowers by making
advance in interest rates gener¬
ally, and raise the carrying cost - funds available under conditions
of the public debt.
This is a haz¬ which would minimize the ef- e
of
an
anti-inflationary
ard the Treasury has so far been ficacy
unwilling to incur; the last issue policy, add to the problems of
of a marketable long-term Treas¬ Treasury financing and increase

will

greater attraction of other ihvest¬

basic

boom

groups

time
rely
placement
of
short-term
funds.
As a result, Treasury of¬ heavily
upon
the
commercial
ferings other than of the shortest banks for its new money financ¬
maturity have met with cool re¬ ing, the Federal Reserve will be
ception in the current market and required to supply the banking
are unlikely to return to favor as
system with sizable reserves. This
long as the in vestment boom con¬ need not, of course, bring gbout a
tinues.
relaxation
of
tight
credit; the
Also, some $13 billion of savings Federal Reserve may make funds
bonds of Seties F, G, J and K are available in so chary a fashion as
outstanding; these are held mainly to keep reserve positions under
by large investors sensitive to the fairly continuing pressure. Also,
portfolios, except for

the

1957

Financial Chronicle... Thursday, August 1,

The Commercial and

28

econ¬

...

Prices—In

addition

direct effect of the invest¬
boom

been

upon

the

volume of

demands

for

' credit

enhanced

by

rapidly

rising prices for capital goods, a
tight labor market and a business
environment particularly condu¬
cive to the inflationary spiral. As
prices climb, larger amounts are

Volume 186

Number 5660. ..The Commercial and Financial Chronicle

building and of home builders, mortgage bor¬
many
e qui p- rowers,
businessmen, and
ment, inventories and receivables; state and local governments; pro¬
the cost of. Government also tends posals are being pressed to ease
needed

to

finance

construction,

industrial

mount significantly, especially
when
so
much
of
Government

to

credit

for

classes

of

borrowers

considered

particularly worthy of
Also, some
members
of
spending is on defense and public relief.
works.
Moreover, as the recent Congress are disturbed over the
of
record has reaffirmed, financing effects
higher interest rates
requirements in an inflationary upon, the carrying cost of the
environment
tend
to
advance Treasury debt. Finally, some ap¬
rapidly

more

than

the

flow

of

savings.
Unfortunately, despite the gen¬

erally level course of the whole¬
price index for industrial
products so far in 1957, the wagecost-price
spiral
has
not
been
sale

halted; indeed, there
prospect

that

it

to

come

halt in the predictable future.
has

become

quite

clear

by

a

It

now

that this spiral owes its existence
to the

widely accepted practice of
raising wages, including so-called
fringe benefits, far more rapidly
than

the

estimated

2%

annual

long-term growth of productivity
in
the
manufacturing sector of
our economy. Moreover, not only
is the untrend in production costs
steeper than can be offset even by
current
huge industrial invest¬
ment and research expenditures,
but in addition the incorporation
escalator

of

clauses

and

cost-of-

that

the commercial

to

reserves

banking system, thus enabling the
banks to make loans more freely
and presumably also easing inter¬

requirements
will
in¬
the problems of the
Treasury will worsen, the de¬
crease

apace,

mands upon

will

and

further,

and

more

find they need more
funds to match the ris¬

level

of

possibly

cept

interest

in

the

rates,
short

ex¬
run,

since

developed

and

mies

as

that

market

well.

vented

in

The

mature

econo¬

common

risk is

will

forces

be

pre¬

from

balancing the de¬
est rates. Unfortunately, such ac¬
mands for capital with the supply
tion would mean a corresponding of
savings, that bank credit wiil
increase in the money supply and be relied
upon to help bridge the
thus in the inflationary potential
gap, that the consequent increase
of the economy, especially since in the
money supply will augment
it would come at a time when and accentuate
inflationary forces,
many businessmen and investors that inflation will become a
per¬
are
becoming increasingly con¬ manent feature of our way of
life,
vinced that the price trend over and that its
pace will accelerate.
the years is upward.
This analysis is presented not as
The
second
line
of
approach
a forecast of an inevitable course
propounded by advocates of easy
of future events but as a descrip¬
credit
is to have
the
Treasury
tion of the problems we may face
provided
generous
funds
to

adjustments

thus confronted with

are

and

distinctive

in

our

which
was
not
other big investment

and

economy

in

present

feature

an

a new

booms, such as that of the 1920's.
Furthermore,
unlike the infla¬

early post¬
war
years
and
again
of
the
Korean
war,
which
eventually
tionary

waves

subsided

as

of the

accumulated demands

filled, the wage-cost-price
spiral gives every indication of
becoming a permanent institution.

costs

and

the financial

boost

state

needs

of

local

governments, the
Federal highway program and the
proposed school aid program are
virtually certain to be followed
further

that the Federal

requests

either

Government

assume

a

larger share of the burden or help
provide state and local govern¬
ments

with

the

needed

funds.

The consequences of such pres¬
sures

to

upon

the Treasury are likely

aggravate the already formid¬

its effects will cer¬ able problems of debt manage¬
the financing re¬ ment. Coupled with widespread
quirements of business and gov¬ discontent at the present high
ernment;
very
conceivably,
it levels of taxation and the uptrend
could also reduce
the incentive of Government spending in gen¬
to
save.
"Thus
the
inflationary eral, these demands for additional
spiral may well keep alive and Treasury funds seem to reduce
possibly broaden the gap between even further the possibility of

If

this

tainly

is

so,

add ■< to

and savings flow.
be pointed out—by
thus intensifying the competition

capital

needs

And—it may
for

funds,
the
wage-cost-price
spiral is exacting a toll from pub¬
lic and private borrowers which
is perhaps not

generally realized,

but is nonetheless real.

Money and Credit Management
—Sustained high investment out¬

lays in

a

basically inflationary en¬

enhance

sustainable

for

the

economic

declining,
event

the

would

Treasury
be

forced

that

in
to

place

,

economy

the inflationary trend tapers

to inflationary pressures.

A Concluding

Comment

the object

of growing criti¬
cism in recent months on the part




than

a

temporary

inflation

gathers

expedient.
momentum,

share would be $2.8 million, to be

and

large
with

a

gether

labor

and the rise of indus¬

costs

trial

productivity; which is at the
of our present inflationary
problems, shows no signs of nar¬
rowing.
Here business manage¬
carry

labor

and

ments
a

union

leaders

joint social responsibility

other

to¬

area,

of

sections

A

population of
is served, and the com¬
does about two-thirds of the

fiscal

policy.

electric business in the state. The

heavy industrial business in the
Chicago area is balanced by farm
customers

in
the
outlying sec¬
Residential and rural sales

tions.

furnish 34%

of electric revenues,

commercial

29%,

industrial

and miscellaneous

27%

10%.

clear

active business and

booming cap¬
ital outlays, a larger budget sur¬
plus is essential, sufficient to meet
sizable demands upon the Treas-

clusion

is

that

needs to be

so

our

tax

structure

revised that it will

stimulate

savings;
the
present
philosophy
underlying our tax
system, namely, that consumption
rather than savings should be en¬

couraged, is clearly inappropriate
to the needs of a rapidly growing

In

economy.

essence,

we

must

and

interferes

sustainable

with

economic

sound
expan¬

though its initial hard¬
be less dramatic and
some off its byproducts — such as
higher wages and prices—may ap¬
pear more attractive at first blush.

sion,
ships

even

may

to meet the

As

cisions

fi¬

of the present and of

so

as

challenge

the future.

fired

producing atomic

plants.. However, if

talk before the New York

The

of 1 cent

excess

a

share.

postwar

company's

con¬

approximated
the 11 years

program

billion during
through 1956, and

$1

estimated

an

Society of Security Analysts
pointed out that the company's

four years

suburban

will have to raise about

very

lion

has

this construction work.

area
has been growing
rapidly. Today the company
830,000 customers outside of
Chicago or 60% more than a dec¬

ade ago.

During the last five

sales

the

outside

was

cost to be incurred by
GE, the kwh. cost of power would

struction

growth utility.
How¬
Chairman Willis Gale in a

kwh

it

the Nuclear Power Group as well
as
on
the $20 million estimated

be well in

a

recent

power

necessary also to pay capital costs
on the
$15 million contributed by

sidered
ever,

ma¬

over¬

is estimated at 7.5 mills per kw.—
about the same as for new coal-

Edison,
along
with other big metropolitan utili¬
ties, has not generally been con¬

years

city have

gained 11% per annum compared
with an 8% rate for the entire
electric

$650 million will be spent in the

new

1957-60.
money

The company

$280 mil¬

to take

of

care

While it

expects to do some $25-50 million
financing this fall, there has been
decision as yet as to the exact
nature
of
the
financing except

no

that

it will not be

industry (excluding sales
to the AEC).
Regarding the continued growth

With

of the

common

stock.

amount of

"We have the utmost
in the

fidence
ties

served, Chairman Gale

area

states:

long

business

for

area."

Chicago
develop¬

the Chicago metropolitan

In the

postwar period 1,200 firms
established

have

these
firms are employing about 200,000 people and spend nearly $18
million a year lor electricity. The
development of the St. Lawrence
Seaway, the Lake Calumet Harb'6'r' and the '(THare Airport should
continue

to

the

Chicago

keep

plants

have

now

a

total capacity of about 3.9 million
kw.

Present

the

on

low

side

and

hot spell it

recent

capacity is
during the

reserve

necessary

was

to reduce voltage for a short

time,
customers were with¬
service.
The projected con¬

although
out

no

struction program for 1957-60 tvill
four steam units with

add

a

cap¬

ability

of 1,120,000 kw., and the
180,000
kw.
Dresden
Nuclear
Station

Power

for

is

also

scheduled

1960. Thus by
the end of that year the company
completion

in

will have

generating capability of
5.3 million kw., providing an esti¬

mated

reserve

1961

the

on

of about 9%

anticipated

(based

summer

sold

90-mile,
&

345,000-volt

Electric

line

tie

American

the

with

connect

also building

System.

to

Gas

Initially this

tie should be worth some 200,000

of

kw.

generating

it

reserve,

is

estimated.

of

the

additional

should further increase
generating efficiency. The num¬
ber of BTUs required to generate
1 kwh. has declined from 14,000
in 1945 to less than 12,000 in 1956
capacit}'

and

the end of next year
drop to 11,200. The com¬

by

should
pany

fuel

costs

annually

by the anticipated increase in ef¬
ficiency.
The Nuclear Power

Station, the
country's largest, is being built
on
a
fixed-price contract with
General
but

Electric

for

$45

million

according to the "New York

Times" the delay of several years
in
beginning
construction
will
cost

GE

some

$20

million

more.

Thirty million dollars of the $45
million is to be paid by Common¬
wealth

and

million

by

the

the

remaining

Nuclear

first

additional
While

issue

of

non-con¬

The

common

earnings leverage.

Commonwealth

is

fully

protected against increases in fuel
costs

by

provi¬

adjustment

fuel

sions in all rate schedules, never¬
theless it is feeling the pinch of

higher costs.

The management

$15

Power

on

July 23 filed an application with
the Illinois Utility Commission for
a $25 million rate increase, equal
to an average increase of 7%% in
rates, and equivalent to 60 cents
a

share

the

on

recent

common

In

stock.

has
been earning about 5.3% on in¬
vested
capital,
as
reported by
the

years

company

Standard & Poor's.
The

is using the de¬
balance method of com¬
depreciation for income
tax purposes. Deferred taxes are
being normalized in the income
account and are placed in a bal¬
company

clining
puting

sheet

ance

at

The company

reserve.

present expects to exclude this
from

reserve

the

will

company

value"

"fair

details

rate

rate

of

cation

are

entitled to a
base although
rate

and

base

not yet

The

base.

rate

be

return involved in the rate

of

appli¬

available.

'✓
earn¬

ings for the calendar year 1957 at
$2.85 compared with $2.72 in 1956
and $2.62 in 1955. While it is im¬

possible to say how long it will
take for the Commission to act

he esti¬
should
earn over $3 a share in 1958, bar¬
ring a decline in business. A por¬
the

on

rate

that

application,

the

company

of the 60 cents

tion

a

share from

rate increase will
probably be absorbed by higher
costs and by the decline in the in¬
terest credit on construction.
the

proposed

Commonwealth Edison has been

should be able to save some

million in

$4

the

mates

Installation

moderate

a

Chairman Gale estimates
a

of

plans

equity may eventually be reduced
to around 35-40%, providing some

peak load).
The company is

issue

to

ratio

company

vertible preferred).

branch

or

new

in northern Illinois;

debt

preferred stock in lieu
common, possibly up to
10%
total capital
(last October it

of

the

55%, the

future

of

industrial

The

in

possibili¬

run

in

long-term

a

around

con¬

has been leading the country.

area

realize that inflation, no less than

deflation,

operating
basis).
On

additional

Commonwealth

Generating

One

current

five-year

a

all cost of

States.

cluding

off to

on

jor cost of $35 million, the

Offers Suggestions

Equally important are decisions
in the field of public policy, in¬

costs

6,100,000

transportation hub of the United

of the highest order.

charged

the basis of Commonwealth's

pany

plants

between the advance of

suburban

northern Illinois.

broad gap

off, markets would very likely
Thus, the basic questions for
Perhaps the key to our prob¬
experience repeated strains and
our economy today may be put as
lems is to fit economic decisions
stresses, and some borrowers would
follows: Can we halt the wage- to the realities of our times. Our
face vexing problems in raising
funds.
Coping
with the infla¬ cost-price spiral which has gradu¬ public policies all too often reflect
ally given our entire economy an ways of thought and motivations
tionary spiral thus appears
as
the most urgent task of an effec¬ inflationary complexion? Are we inherited from the Great Depres¬
tive
national
economic
policy willing to allow market forces to sion, now a generation past, when
the issues of the day were under
seeking to
foster
long-term bring investment outlays more
closely in line with the available investment, credit contraction, de¬
growth.
supply of savings? Can we resist clining prices and widespread un¬
Easier Credit Pressures
pressures to use the commercial employment.
These basic prob¬
banking system, either directly or lems are the opposite of those that,
Unfortunately, current indica¬
tions are that Government policies through the Treasury, in an effort prevail today and have prevailed
to substitute bank credit for sav¬ for most of the postwar era.
If
will be exposed to insistent pres¬
the interests of economic growth
sures
in the opposite
direction, ings capital?
over
the
long term are to be
These issues are very real; they
namely, to ease the shortage of
funds and hold down the level of are more important today than at served, we must finally rid our¬
selves of aims and policies inher¬
interest rates by means designed any time in our modern economic
ited from the depressed environ¬
to
strengthen / the
inflationary history. For obviously, reliance
ment of a quarter century ago and
trend. These pressures are already upon
bank credit to meet the
apparent.
Credit
restraint
has shortage of savings is no more energetically reshape public de¬
been

Group (of which Commonwealth's

electricity to the city of Chicago

ment of

sury's cash position without large
new
borrowings.
Another con¬

yields are made much more com¬
petitive than at present. With the
maturity of the Government debt

Commonwealth Edison Company
Commonwealth Edison supplies

growth in the years ahead. Un¬
fortunately, there is no evidence
at all of greater moderation in the
upward trend of wage rates; the

the

of Treasury obligations unless

of

back. In the process, however, un¬

chances

also

but

lesson is that under conditions of

a

reliance
upon
bank
would raise the pros¬ increased
credit to provide the
necessary
continuing pressures in
refinancing.
The
capital and credit markets. Mar¬ financing and
ket forces, if allowed to operate, Federal Reserve, in turn, would
be
called
upon
to provide the
may
be expected eventually to
redress the situation, since interest banks with the reserves they need
to assist the Treasury's operations.
rates would presumably advance
This path, too, would thus lead to
to the point where the flow of
an increase in the money
supply
savings is adequately stimulated
and demands for funds are
cut and to mounting exposure of our
less

markets

substantial Treasury
surplus. At the same time, as long
as the investment boom continues,
the Treasury will find few in¬
vestors interested in the purchase
achieving

vironment

pect

only provide relief to the capital

root

were

By OWEN ELY

ing costs of capital goods. Nor is
this approach likely to achieve a
lower

Utility Securities

bor¬

will

term

inflationary trend which is

Public

the commercial banks

expand

rowers

in the long- favored classes of borrowers. The if the investment boom continues
vigorous
and
the
inflationary
wage contracts of key in- Treasury
is already
being
re¬
dustries seems to assure a con¬ quested
to
make
more
credit spiral persists. Much depends upon
the decisions of businessmen, labor
tinuation of this trend, and hence available for direct lending
on
union
leaders
and
government.
of a generally rising price level,
homes, public housing, slum clear¬
for
the
years
ahead, especially ance and the like, and each year There are a few signs that some
programs
are
being
since a continued tight labor mar¬ brings larger appropriations for capital
stretched out; a deferment of some
ket is in prospect.
the Small Business Administra¬
outlays at this time would not
tion. As ever rising construction
We

living

29

nancing

mounting financial require¬
creidt
restraint
may
keep
the ments will necessarily add to the
economy from achieving its maxi¬ pressures
upon
the
supply
of
mum growth
credit and investment capital.
potential.
In
seeking relief
from
tight
These problems are not unique
credit, some would have the Fed¬ to the United States: they are
eral Reserve relax its policy of shared to a
greater or lesser de¬
credit restraint and provide addi¬
gree around the world, in under¬

little tional

seems

will

prehension has been voiced

(501)

selling
based
is

39

and

the $2 dividend the

yield

recently

on

around

The stock is selling

5.1%.

times the estimated

13.7

of $2.85

for this year.

With Security

Planning

(Special to Thil Financial

WEST

Vernon

PALM
J.

added

Chronicle)

BEACH, Fla.

Holsclaw,

Klepak and Jane E.
been

at

earnings

—

Herman

Kircher have

to the staff of Secu-

Financial Chronicle

The Commercial and
i

■■

Continued jrom page

6

Tracing the Regulatory Pattern
Of the Federal Securities Laws

perience in administering it.21 The
basic
purpose
of the regulation
has been
to afford shareholders
the
material facts important to
any

analysis of matters presented
has said
this Congressional action "has

tered

that

certain

more beneficial
corporate democracy in

had

probably
effect

on

a

and

rules after notice

our

the

under

face

of the registra¬ Congress met the problem
of
of the Act.
In trading in securities. There are
other words, if the requirements
two principal branches of the se¬
of the Rule have been complied
curities industry relating to trad¬
with, new securities delivered to
ing in securities—the stock ex¬
the stockholders in such situation
change market and the so-called
need not be registered.
over-the-counter
market.
When
The rationale behind the rule is
Congress came to legislate in 1934,
that since there
is no volition
it thought primarily in terms of
by the individual stockholder to the stock
exchange and passed the
accept or reject the stock in his
second of our statutes, the Securi¬
individual capacity, there is ho
ties Exchange Act of 1934.13 This
sale to him.
statute
required registration of
This rule has been used as a
the
stock
exchanges themselves
subterfuge to avoid registration.
and also registration of all com¬
Indeed many of the securities sold
the securities
of which
in the "boiler rooms" I mentioned panies
the

for

purposes

provisions

tion

being sold in reliance on

are

such

listed for trading

were

on an

ex¬

change.

devices.

In

regulating trading, of course,

cide.

But

we

whatever

of

adequate
Our

information.

truthful

that

should

decide

basis

the

on

concerned

are

they

be

and
rules

provide for the submission to m of
proxy
material before it is dis¬
seminated. In most cases offensivematerial will be deleted
in

with

accordance

or

revised
sugges¬

our

material goes
to the stockholders in a mislead¬
tions.

if

However,

ing condition the courts have not
hesitated to grant our

injunction

requests for
prevent the voting
obtained.

to

of proxies so
Of

recently

also there are

here

course,

try to cut corners. Only

those who

insurgent group waged

an

example,
in one case X
a
proxy battle against the man¬
it is none of our business whether
exchanged 1,750,000
agement
of
a
large
industrial
stock for all of the the market goes up or down so
company. They did not make false
shares of Y corporation. Y's sole long as there is no market manip¬
statements. They just asked ques¬
We have no power and
asset was an oil field valued by ulation.
tions such as: "Where is the Pen¬
For

corporation

of its

shares

the

about

$2

The X stock was not ac¬

million.

included

deal

the

free

to

interfere

of

interplay

with

the

"Why does the
forces of
management withhold an account¬
But we are
ing from its stockholders?" "Isn't
that all price
it odd that the company wrote off
the

sion Fund money?"

to Y, but in¬ supply and demand.

transferred

tually
stead

at

corporation

Y

desire

no

an

ar¬

concerned

vitally

for the stock to be movements result from the free$4,000,000 of assets that were 'no
to the President of X judgment of buyers and sellers
longer in existence'?" There was
with
the understanding
that Y trading in fair, honest, and order¬ no basis for
any of these insinua¬
was
to be paid only $2 million. ly markets.
tions.
When we applied
to the
The
securities
were
sold
at
This statute, incidentally, was
court for an injunction, the de¬
greatly inflated prices resulting the one that created the Securi¬ fendants
piously- said that they
in a net profit to the sellers of ties and Exchange
Commission. had no intention of charging the
about $5 million over and above
During the preceding year the management with impropriety or
the $2 million that Y received.14 Securities Act had been adminis¬
misconduct.. They were just ask¬
The Commission and the courts, tered
by the Federal Trade Com¬
ing questions. It is almost unnec¬
accordingly, have taken the posi¬ mission. By this statute the gov¬
tion
that where the
merger
is ernmental functions under both essary to add that the courts had
no difficulty in finding that these
merely a device to effect a public statutes were entrusted to the
the prohibi¬
questions violated
distribution of securities without
newly created SEC.
tions against false and misleading
registration, the rule is not appli¬
In addition to requiring regis¬ statements. 23
cable.
rangement

turned

where

case

the

in

stockholders

the

purchased

securities

of

tration

listed

which

are

exchanges, the Act also

on

In

another

case

obtained

was

injunction

an

where

the

identity

includes regulatory provisions re¬

of one of the participants in the
lating to companies issuing such solicitation was conctaiea.24
securities,
wnich
have
become
poration to sell their stock, the
Two years after the passage of
very important. One of these pro¬
Commission sought an injunction
the Exchange Act, Congress en¬
visions requires the reporting of
to prevent the sale of the stock.
larged the statute to provide more
all purchases or sales by an of¬
The court sustained the Commis¬
detailed regulation of the oversion's position that the rule had ficer, director, or 10 % stockholder the-counter
segment of the securi¬
of his company's stock, and pro¬
no
application in the situation
ties
industry.
It
provided
for
vides
for
the
liability of such
where the exchange "was but a
registration of brokers and deal¬
persons to the corporation for any
step in the major activity of sell¬
ers, gave the Commission authority
profits that might be made on
ing the stock." 13
to deny or revoke registration in
short
swing transactions within
Consideration
is
now
being
appropriate cases, and gave the
a
six-month period.1'3 While this
given to proposals for modifica¬
Commission
certain
regulatory
provision is intended to prevent
tion of the rule.
and visitatorial powers over them.
There are certain other exemp- the improper us of inside infor¬
no
such
use
need
be
tive provisions in the Act which mation,
Praises NASD

signed authorizations
the issuing cor¬

corporation
for

I

officer of

an

have

not

mentioned

but

time

shown. The

provision is a prophy¬
subjects all such

will not permit a discussion of all
of them. Before leaving the mat¬

lactic

exemptions, however,
I
one thing clear. All
of the exemptions I have men¬
tioned are from the registration

less of the circumstances.

There are no exemp¬
tions of any kind from the anti-

the

ter

of

provisions.

profits to being disgorged regard¬

Improving Proxy
Another

to

solicit

Procedures

important provision is

which

one

makes it

proxies

in

unlawful

violation

con-espond with
Is

a

of

increased

difficult

problems

the

we

Variable

Annuity Life InAmerica, et. al, District
District of Columbia, Civil Action

Court,

v.

Co.

curities

17 SEC

230.133.

Oils,
Exchange Act Release
Sweet

Grass

Ltd., Se¬
No. 5483,

of

Court,

Civil

Action

18 15

April 8, 1957.

v.

trict

their

U.

No.
S.

C.

57-385-W.

was

16,

15

U.

S.

Supp. 558,
 562 (S. D. N.


Y. 1957).

20 Section

14(a),

15

U.

148 F.

C. 78p.
S. C. 78n fa).

the

The

general

Commission,

have

members

for

conduct

just and equi¬

principles of trade." 25 There
comparable provision for

no

of

members

association has

one

rules

panies, although there was strong
support at the time for such a
drastic solution. The method actu¬

istered,

CFR

the

over-the-counter

Control
clair

240.14a.

Proxy

(1957),

Armstrong,

See

Aranow

and

Contests for Corporate
Introduction by J. Sin¬
former chairman of the

SEC.

selves

Loss,

23 SEC

(C.
71

to

op.
v.

cit.

supra

May,

1955)

134

affirmed

pp.

523,

F.
229

525.

Supp.
F.

2d

A.

meeting rather strict standards,"
that one and to reorganize their capital
comprises in its membership the structures so as to eliminate com- ■
large* majority of all securities plexities and inequities.

dealers.

efforts

association's

This

(iqC7t

25 Section

6(b),

15

U.S.C. 78f(b).

which

Act,

the

of

11

Section

of great

•

value in pre¬
embodies these principles, early
venting unlawful practices by the received the label o£ "death sen¬

have

been

industry.

over-the-counter

tence" and, indeed, many of the
broker-dealer most famous and infamous hold¬
who had been expelled from the
ing
companies were
unable to
Association, took an appeal to the
meet the requirements of Section
Not

long

ago

a

the power to re¬
disciplinary
actions.
of that expulsion was

which has

SEC

such

view

The

basis

what

and

11

have passed out of ex¬

so

the whole

on

sentence"

"death

But

istence.

is "

Many

misnomer.

a

colloquially call "churn¬
holding companies continue to ex¬
ing."
Two
elderly
ladies
had ist.
Dozens
of them
exist free
placed with this firm their life's
from Holding Company Act regu¬
savings of about $50,000 for in¬
lation by
virtue of exemptions,
we

The firm did nothing so

vestment.

crude

to convert

as

appropriate

or

But the sales¬
obtained the trust

of the funds.

any

having

man,
and

formed customers,

unin¬

these

of

confidence

persuaded them

to sell certain securi¬
purchase others. All of
purchases were of legitimate

repeatedly
ties

and

the

securities.

worthwhile
time

security

a

firm

the

each

But

bought

was

the

and

commission.

a

Over

sold,

or

made

salesman

six-year

a

granted by the Commission as;
provided for in the Act. But some
23

holding company systems, rep-,

resenting roughly 20%
vately

cf the pri¬
electric and
gas

owned

in the country,
under the Act
and
subject
to
its
regulation.
While some of these may qualify
industry

utility

remain

registered

for exemption, we expect to ne

actions

in

regulating electric
utility holding companies

and gas
for

future.

indefinite

trie

million.

$1

and

over

An

were

stocks

Several

bought

sold,

bought,

over

pany

total amount of

a

To

over.

integration
standards

$24,000 and the net capital

over

the

in

decreased

account

by

an

equivalent amount. -The Commis¬
sion

not

only sustained the firm's

from the , Association,
further investigation
the basis of which the firm's

expulsion

made

but
on

a

registration

was

revoked*^

Public Utility Holding

5;

In

M

which

and

holding com¬
has met the
simplification

of the Section

South

and

system,

electricity to

serves

through

the

is

It does

subsidiaries—•'

two

which

of

one

large

a

part of the State of Texas.
this

is the

11

West

West

Texas

Utilities

Company, headquartered
Abilene, Texas., and the other

in

Com-l

is Central Power and Light

headquartered in Corpus
These
companies
and
fheir parent are subject to our]
.regulation under the Act with ire-pany,

Cliristi.

■

Act

spect to all of their financing and,
Congress ^'pa&sed the
oilier strictly corporate activities.,
Utility Holding. Company
U should emphasize, what I as-;
It was more than' imeTely*
sume is known, that we have no

1935,

Public

,

Act. 29
a

Central

a

which

system

long

a

story short, the firm's commissions
on this $50,000 account amounted
to

of

example

sold,

and

make

in",

business of

the

period, there were over 600 trans¬

disclosure

ute.

anti-fraud

and

stat¬

updn ah'CktehsiVe in¬

Based

vestigation made by tthe. Federal
Trade Commission' -and- by" Con¬

ratg regulatory authority or re¬
sponsibility,
Federal

,

pates%ahe; regulated.
Commission.

Power

'

;

committees; "the Act
In addition
to this registered
sought among-other things, to re¬
holding company system, Texas
organize the < corporate structure
has utility companies which are
of the electric and'gas utility in¬
tree from the Act's regulation by
dustries.^: The investigation
had
gressional

•

.

shown

alarming degree of con¬
of control; particularly
electric industry.As an

in

the

hoL.ing
found to

this, •" three"

example

of

company

systems were

exercise

effective

control

of the total electric

45%

over

produc¬

tive capacity in the

country. Some
systems controlled 80%. 30

15

concentration

This

made

was

control

of

by the fact that

worse

the holding company systems were
assembled
ter

helter-skel¬
opportunities arose

largely in

fashion

as

without

relation

tional

also
by complex capital struc¬

to

principles.

financed

which

tures

virtue

of

p t

ex e m

an

centration

sound

They

security

is

which.
re e

late

through
subsidiaries —»

&

Service

Power &
any

company,

business

Power

Electric

An

Utilities Com¬

operating

•

orders

v e

holding

a

does

Dallas

i

Commission.

Texas

splely

pany

t h

the

bv

example

Light.

Light,

Co.,

Texas

and

Texas

We do not. regu¬

of the activities of sucli

companies, but

tinuing,, duty

do have

we

con¬

a

reexamine

to

their

entitlement to exemption if there

should

be any material

change in

their situations.

opera¬

were

bewildered

granted

There
in

is

detail

any

;

not

time

the

to

describe

immense

task

accomplished- by the Commission
in
this
corporate
and financial

the
systems,
reorganization of our utility in¬
holding compa¬ dustry. The job
was/done with
systems, dangerously -none of the loss of values to secu¬
susceptible to trouble upon a small
rity holders which the opponents
decline in earnings of the under¬ of
the-Act had gloomily forecast,
lying operating companies. To a and the experience has been that
large degree it was evident that -many
an
operating'-. - company,
these complexities were the result when
finally separated from
a
of the desire by management, and
parent
corporation,
has
found
and

made

particularly,' the
nies

in

the

in several notable instances of one

key

personality

in

new

vigor to expand to meet

management, rapidly

to exercise maximum control with

27 Section

28 Johnson

690

D.C.

(C.A.

2,
1956).

29 15

U.

Those

heeds.

fuel

and

our

power

companies

which

to

26 Section

123

crowing

investment, and to sell remain subject to the Act appear
gullible members of to be in good health and pro¬

securities

247

2, 1956).
Ostergren v. Kirby, N. D. Ohio, No.

7Q7

properties

tems, plus certain other

15 U-S.C. 780-3.
15A(b) (7), IS
U.
S.

gressing

15A,

C.

S.

30 Federal

&

Co.

1952);
C.

79.

Trade

Corporations, 70th
Doc. 92, Part 72A,

v.

231

SEC,

F.

198

2d

F. 2d 523 (C.A.
:

Utility

Sess.

The

next

maior

securities

S.

en¬

actment by the Congress was the
Trust Indenture Act of 1939.

.

Commission,

Cone-, 1st
pp. 37-44.

successfully.

Trust Indenture Act

780-3 < b) <7).

(S.D.N.Y.

to reduce them¬
single integrated sys¬

coir panics

ing

Association

National

the

hold¬

ally adopted was to require

been reg¬

ever

;

of Securities Dealers, but

minimum
21 17

24

19 Section

the

to regulate and discipline

own

table

78.

Controls,

v.

that at this

self-discipline.
under

"inconsistent with

22

Mortgage Clubs, .Inc., Dis¬
District
of
Massachusetts,

Micro-Moisture

15 SJL.C.

of

of

Einhorn,
16 SEC
surance

noted

segments of the industry

that

aegis

No. 2549-56.

CFR

14 Great

two

powers

ex-

Security?

Questions of exemption are not
only

our

be

exchanges,

provisions. Any sale of a the rules of the SEC. 20 The Com¬
security which
is effected
by mission has adopted a comprehen¬
fraud, misrepresentation or half- sive regulation which has been
to time
to
truth is a violation of the statute. amended from time
What

might

stage one vital difference between
was

fraud

33 17

its

provide for

to

disciplining of members in order
to
"promote just and
equi¬
table principles of trade."27
Only

holders

It

and

one

wish to make

the

designed

.

simply'to abolish holding com-

not

meet

and

standards

be

must

must

association

an

Congress to the

by the studies was

facts disclosed

regis¬

be

To

over

another

In

dealers. 26

and

The response of

bro¬

securities

of

associations

of

kers

labels.

tive

registration

for the formation and

public by giving them decep¬

the

industry. Accordingly, in 1938 the
Act was again amended to provide

for their vote. One writer

Securities Act. America than any other of the
Even after 22 years of Commis¬ numerous
weapons
in the SEC
opportunity for hearing, and pub¬
lic comments where required by sion administration of the Act we arsenal." The Commission has de¬
the ')
Administrative
Procedure are still confronted with novel signed its rules "so as to make the
Act or, if necessary, to request questions as to what is or is not proxy device the closest practi¬
Congress1 to
enact
appropriate a security. We haveaiow pending cable substitute for attendance at
a
case
involving variable
an- the meeting." 22
legislation.
nunities.16 Not long ago we ob¬
Our proxy rules, like the provi¬
"No Sale Theory"
tained a consent decree in con¬ sions of the Securities Act, are
For
example, the Commission nection with the sale of certain
basically
disclosure
and
antiis now giving serious considera¬ types of mortgage notes."
Re¬ fraud rules. They require dis¬
tion to what is known as the "no cently a group of food dealers
closure of material facts pertain¬
sale theory" which has been em¬ associations submitted a brief to
ing to any matter which is to be
bodied in our Rule 133.13
That the Commission contending that
voted
upon
and
prohibit false
rule provides in effect that where trading stamps should be held to
statements or half-truths. I would
a
vote of stockholders is taken to be securities.
like to emphasize the fact that in
authorize
a
statutory
merger,
As I have indicated, the regis¬
all proxy contests our position is
consolidation,
reclassification of tration and disclosure provisions
an impartial one.
We do not care,
securities, or a transfer of assets, of the Securities Act of 1933, were
of course, which side in a proxy
such transaction is deemed not to
concerned with the distribution of
battle is the winner.
That is a
involve a sale to the stockholders
securities.
The
following
year matter for the stockholders to de¬
amend

>

1957

Thursday, August 1,

...

(502)

30
*

is

actually

Securities

an

Act

This

amendment to the
of

1933

to

provide

Volume 186

Number 5660

The Commercial and Financial Chronicle

...

investor .protection

additional

in

speculative

a

of bonas, debentures and

the case

the

certain

themselves

indentures.

trust

requires

trial

under

indenture

an

bonds

In

there

1940

gressional

enactments

the

—

In¬

Company Act. 32
Advisers Act

give

to

those persons
auvice.

Apart

visions to

their

•

as

other

kinds

There

there

area,

held

those

are

investment

who

analysts who

^

a

careful

study of corporate balance
sheets, market trends, etc. There
also

are

the other kind who have

ususual methods of
predicting the fluctuations of the
some

very

One

market.

of

the

guing to my mind
ment

adviser

special

and

of this

who

the invest¬

had

quote directly from the
sion's

opinion

charter

was

voluntary

a

all

the

of

and

As

pointed

I

the

Holding
Company Act brought under Fed¬
eral regulation a particular seg¬
of

ment

out,

American

the

offer

marketable
substan-

were

value to their

stocks and

accrued

of

group

what

different

vestment

tended

panies.
of

curb

is

;

who

companies to

them

use

of

Commission

reorganizations

these

important

resist

the

act but
discussion

a

duties.

I

can-

opportunity, how-

mention

to

ever,

under

bankruptcy

will not permit

not

has

advisory duties relating to

Federal

such

their

for

insiders
the

to

com¬

panies for cash their own investments"'which had turned out to
be

unmarketable

value,

used

dubious

of

or

the

companies

to
guarantee their personal under¬
takings, and borrowed from the
companies without any collateral
or
adequate
security.
I
would
like

make

to

-

it

that

clear

the

stafute does not undertake to
trol

the

This

direction

remains the

the

that

sentially

*

responsibility of
The

is

Act

es¬

Commission
be

and
the

disclosure

full

and

made

their

to

courts

security

the

Federal

rendered

the financial

of

activities

and

of

Underwriters,
kers

Management

security

holders

Transactions

panies

and

hibited

submitted

be

must

the

insiders

com¬

are

pro¬

reeulated.

strictlv

or

to

approval.

for

between

the

bro¬

and

minority of

a

management.

contracts

companies.

bankers,

limited to

are

the

the

condition

To

early

went

we

part

back

to

insiders

joining
act

to

officers

as

or

en¬

continuing

from

directors

if

thev have violated their fiduciary
duties.

Cites
In

one

recourse

Two

case

to

Examples

courts

which

management

a

tained

control

of

ment trust with

ment.

^

the Commission had

the

a

a

to

unseat

had

ob¬

large invest¬

nominal invest¬

The management

then

proceeded to dispose of the mar¬
ketable
investment securities in
its

portfolio to acquire control of

31.15

u.

s.

C.

32 15

U.

S.

C.

of

1933

to

(1949).




SEC 563,

time

a

be of

Action

give

to

to

come

informed

and

m

appears

the

years

ago

late

the

major step looking

a

consolidations.

needs

and

ways.

.

We do not

frock

wear

not

think

lines

allowing

Railroad

the

&

Boston

issue

to

deben-

standing
preferred.
The
latter
pian previously had been turned
down by the Commission.
jn the 'Frisco decision, Division
turned down the petitions

Four
0f

coats, and

frock

the

and

coatedly.

Illinois

the

Central

Seaboard

Air

Railroad

Line

Rail-

with

whom

we

confer think out loud

and in

the

for
joint
control
of
the
Georgia
Central.
Before
bankruptcy the latter road had been

they put

our

controlled by the Illinois Central,

We

those

and

is

we

the

and

table
We

be

and

to

However,

in
proceedings,

under-

understood.

practical problem,

Way

unbutton

and

want

Ours

reorganization

the
this

control

was

eliminated. Not unexpectedly, the
recent decision ruled the existing

problem
under the re-

a

a

be worked out,
rates
and
routes
linking
the
of the statute, with Georgia Central
with
some
35
businessmen.
We seek decisions other carriers must be maintained,
to

At that time,

quirements

which will carry out the law and

'Frisco has agreed

yet

it averages

day

that

At

workable.

that is the best

about

listed

shares

New

York,

between

Gov-

of

Erie

the

Bar

5,

the

1940.

May

of

Railroad,
&

awanna

City

the

Delaware

WORTH

Charles F

Texas

vvuuj.il, lexas

S3'1^3? an?

vmaiies a. flc Raiiroad

^?n<o'fficesTt
omces ai

looking

the

of

' merger

Lack-

Great

and

Co.

Of

to

Hudson

&

studies

course,

C. F. Alexander Opens

Delaware,

Western Railroad

the

New

Exchange

a new

vast rail system pro-

in

great'

a

has

turn

degree

in

the

cannot

strongly.

maintaining

securities

be

Few

mar-

stressed

of

too

unaf-

are

us

f^„b\S^»rrkhlln^C1,i£
million
Americans
holding
life
insurance

through

the

bonds

the

in

Beneficiaries

panies.

funds

holders of

and

company,

similar interest.
of

shares

pen-

invest-

have

provide

the

has

s.D?

F.

254

(C.A.

1,

v.

1945).

^Y.fV*c^C'71Nof 80-3&2?

SEC,

jsjew

a

y0rk

.

L.

of the

W.

&

One

of

joint

of

use

Erie

of

the

the

to

give further growth
system.

new

of

creased

this

Industrial-

district

considerably

has

in

in-

recent

years,

D. E.

Murphy Elected
Governor of IBA

COLUMBUS, Ohio —Dennis E.

Murphy^"vke-Presrdenr'of"The
Qhio

Company

Governor

a

has been
the

of

elected

Investment

Bankers
Association

nhir»

of

rep-

the

vaii0,.

Group.

He

SUCCeeds
j

a

m

e

R

s

Burkholder
jr

Almstedt

Brothers

City.

in

to

Officers

both

roads.

are

New York State.

upper
One

which

merger

(Special to The Financial Chronicle)

PORTLAND, Me.—First Maine
Corporation has been formed with
offices at 84 Exchange Street to

business.
and

Cross is President

Treasurer.

Fla. Sees.

POrnmjttPf

jous committees of the Ohio Valle^ Gr°uP and

a

member

has held other national IBA posts,
He entered the banking busiCitizens Trust Co.

Since 1938 he

Western

North

&

No

Railway.

can

tke pr0perty and improve operat-

other

been

purchased

The

by

pjerce,

offices
ulllVvi,

°25 Broad Street, New York City,

of

The

Ohio

was

made

MerrTLynct

Beane,
Group.
The

Chair-

Group
Ohio,
Columbus,

central and southern

serves

jnciucjing
Bayfon>

Cincinnati,
aB 0f

ancj

of

state

Kcntimkv

Correction

absorbing leased

guaranteed lines to simplify
their capital structures, -i

formed to engage in the securities
business from offices at 311

continue

will

trend

of

respect

already

the

the

to

337,236

it Church Street, Nashville. We are
Georgia" informed that a securities business

'prisc0

common

amounted

$20,525,965.

and

as

such

its

ing

to

o

is

not being

conducted.

of
American Investors Corporation,
^

^

Poole

is

Fontell

President

Flock>

l.

W.

Vanadore, and Hubert Long are
decision, 'Frisco will take officers associated with him in

addition,

control

at

bonds

In the "Financial Chronicle" of
July 25 it was reported that Flock,
Long, Poole & Vanadore had been

I-

Onpnc

v-fp

by

E Nida
Fenner &
^he

man

in-

larger roads,

ciuding the New York Central
Pennsylvania Railroad, like-

and

In

Reuben Rose is conducting a se-

and

announcement

jLk

^r^Uhi^shares Amounted

Leila Blauner, Vice-President.

bonds

political agencies throu'gh-

xveniucKy.

ing efficiency.
Many of the

and

^Flonda

writing of all issues of state and

Leonard Blauner, President:
Harry Marcus, S e c r e t a r y; and

from

1954 was Chair-

the legislation committee an 4

170,417 preferred shares outstand- Frank

ixwn,

m

Hf also has been

Purities ^usiess.^ oufcers Y^e

business

Murpny

Company.

Securities Underwriters, Inc; has
been formed with offices at "927 owns; it's

*vuj>e

E.

Dennis

Var-

St. Paul & Pacific and the Chicago

started

Underwriters

MIAMI BEACH, Fla.

„

has

L

serve(j
jmjs

for

out the United States which have

iy
■

irwma
„

e|ec+ed

municipal
to

seems

until the North Western
show some earning
power.
In this respect the management of the North Western
has been working to rehabilitate

Form First Maine Corp.

-

'

have been dropped for some time
\s that of the Chicago, Milwaukee,

cipated
again

securities

!

*

^

out-of- ness in 1923 with the old First

substantial

savings

Rudy M' Eyer> Secretary-Treas- ^ogress along this line is anti-

a

Kv'

Louisville

establishthe Lack-

pected to be initiated, particularly

securities business

urer

...c,
curities

1952."

facilities

D.

resulted

become,

Trust

to

ization

Further joint operations are ex- has been in charge of the under-

Angelo R. Leto, President; Edward
B
Gibson,
Jr.,
Vice-President;

through the operation of the capiInvestment

ment

from offices at 10 East 49th Street,

in

They

the

first steps has been the

"

is

M.

industry

duplicating

Family Fund Investors, Inc. is in

engaging

engage

mechanism by which
may be broadly shared
people.
Ownership of

American

A.

Family Fund Inv.

Burton

a

industry

William

and

pocket"

a

and

Some progress already has been
113 the useof paralleling^and

^uchholz,

at 220 Broadway, New York City,

And the families

ofth^ people.6

Texas',

and

promises

the

Hyman Detchel is engaging in awanna terminal and ferry service
securities business from offices in New Jersey. This eventually

who

nomic'needs
by

a

in

a
half million citidirectly own shares of
corporations
are
vitally
concerned.
Our corporate wealth is
very broadly held.
The securities
markets provide the mechanism
by which business raises the capi-

eight

zens

new

Detchel Opens

com-

under

when

and

,

.

Claudia

Vice-President

of corpora¬

insurance
.

...

the

in¬

an

investment

stocks

by

of

Albert W. Buchholz,

Buchholz, Secretary-Treasurer,

markets

these

great

and

held

ment

have

policies

interest

direct

President;

national

....

Fj irnP°.rlance
confidence in our

Officers

company are

present

incom^ an'd ^^tior^F oToductivity
kets

Buchholz.

resulted

Pmnlovment

nrn-npritv

of

Missouri

Chattanooga, Tenn., and Savannah, Ga. It is the latter port which

term

York

of

our

1920s

states

three-year

laws, and that restored

ronfidpnee

to

enforcement

abandoned in the late

14th Street, to continue the' "Northerns'
investment business of Albert W.<controlled

east

Y YYYIYeYrs *on

vigorous

the

Oklahoma

resenting

The, la«er consolidation would

create

and

Central of Georgia operates about
1,800 miles between Birmingham,

America,

Zt51i Kdce*

system

between

the

Arkansas,

the merger.

Today it is about $200 billion.

reUance

Kansas,

miles

and

I. C. C. ordered the
to give up the jointly
profitable
Chicago,
Burlington & Quincy as part of

$34

was

Tennessee,

Northern
underway.

new

Southeast

5,000

some

Birmingham

formed with offices at 1010 North-

billion.
In
my opinion, this
restored confi¬
dence in our capital markets is
Stock

runs

Northern Paciare

now

the

the

the Southwest. 'Frisco now serves
the gulf Coast ports of Mobile,
Ala., and
Pensacola, Fla., and

of

$10 billion.
value of all

the

on

enable
both

serve

to these stipu-

Probably the next big consolidation question will involve the

business."

and

36 Association

of

that

of bringing

means

cooperation

ernment

think

We

the trackage it con$40%.
The two
at Birmingham, Ala.,

meet

will

and
to

lations.

be

share,

a

about

was

over

the

time,

by

Buchholz Investment Co. has been

issues

new

and extend
trols

more

ture bonds and scrip for the out-

.We do

.

the

The

emphat-

decision

false

on

the

share and

a

Central

jcally demonstrated in the recent

busi-

must buy up

at $56
preferred at $82
common

Francisco to the Atlantic Seaboard

by the Commission Division,

financiai

This also has been

problems with
of

the the 'Frisco

observers, is

rail

Maine

60

liberal viewpoint adopt-

of

more

ecj

today:
try to

said,

within

Se Sg hefd

acquisition of the Georgia
will
push
the
eastern
terminal of the St. Louis- San

importance, in the opin-

the

and

true

is

understanding

stand

do

as

Of great

stockholders

o?ThTcen- ftf?in\torder.

Railway by

to further railroad

per-

nority

rnmmkcinn

control

Georgia

the

st. Louis-San Francisco Railway

dis-

us

of

tral

dignity.
We
recognize that, although we have
official titles, we are still human
beings and do not know it all.
we

Four of

ion

20

approach business

not

Division

In bachtg de

prompt

a

with

what he said then
We on SEC,
he

ness

of

to-

securities amounted to
about $400 million annually. To-

151

80a.

Ruling

write

Association

PT

talk,

my

corporate

34 Aldred

80b.

33 Frederick N. Goldsmith, 30
564

the

people had lost confithe capital markets as

our

day.

sion

decrees

courts

to

those times with the situation

cluding the power to obtain from
Federal

to
can

viding substantial operating ecodence in
nomies through joint use of facila
place to invest their savings. ^Ofms Buchholz Investment'jties and terminals.
A plan for
Tt might be of interest to compare" OKLAHOMA CITY, Olda. — the amalgamation of these roads
when

tions

the

them

sonally.
Nearly

A1

the

provisions the Com¬
mission has a. wide authority in¬

enforce these

try

their problems

cuss

by the SEC in these diffi¬
complex reorganizations.

.

holders

and

invite

Restored Confidence
In

Railroad Consolidations in Light of St, LouisSan Francisco-Central of Georgia

members

problems,

an^ .helpful
Gr if they aie
irJ any of our ot Washington or
e vJcmity
of
regional offices, we

cult and

securities

companies
register
with

must

mu^t

con¬

preventive.

Investment
trusts

assistance

investment.

of

management.

the

to

practice

These

transferred

Hons

stand

time

the

their

We'welcome communica- Interstate"commprnp

service.

In

com¬

controlled

purposes.

often

the

was

with

They should feel free
to us if they think we

in¬

found

abuses

investment

abuses

those

own

Act

In¬

One of the most flagrant

such

by

Company

to

within

exist

The

pattern.

bar

on

industry. The ' ipdges have expressed publicly—
Act brought in. some instances in their formal
companies un¬ opinions — their appreciation of

der Federal regulation. However,
the latter Act provides a, some¬

the

assist

to

eager

of

vests.

Investment Company

another

are

our

the

Railroad Securities

In conclusion, I wish to emphathat we, at the Commission,

feet

the

se¬

com-

The plan

of

in

thb

size

This, then, is a summary of the
six acts administered by the SEC.
adcition

at

provided,

vernacular:

corporate

certain

of

is

progress

dividends3-

interpreted by him would reflect
the stock exchanges." 33

new

but virtually

one

which

preferred

savings

defendants another the Commission, spoke to
man of
Bar

readily

received

securities

transferable,

to
place
disposal of
industry, and thus the capital so
their

31

willing

/?£011}? Fra?k, then Chair-

public security holders

themselves

availed

future

on

the publicly
exchanged for

the public investors.

of

certain

movements

and

pany to incorporate certain protective features
for
the
benefit

comic strips, in ;vhich he believed
there existed a code which, when

curities

Com-

fair

the

of

otd

I

7

o.

-

tially equivalent

Commis¬
the daily

"on

—

the

freely

are

the assets of the

over

Part

based—and

was

the

the

very

a

formula.

secret

formula

intri¬

most

was

<r?S

Fe

plan

companies.
This plan
required certain amendments

also
to

no

pre-

+1

a

defendant
-

expert

make

were

with

which-took

in

advisers.
are

its

yield

as

wheieby

slocks

aftiliated

various

are

investment

of

r+Jq

regarded

equitable

ar¬
as

to

as

i

v

mission

to his

profit
sharing
rangements, etc. Of course,
any

in

publicly held

pioposed
reorganization which

customers,

prohibiting

^

.

client any interest
transactions recommended,

the

in

invest-

alleging

so

the

£? ilS?

particular

disclose

and

fendants

deceit

there are
provisions such
those requiring the adviser to

upon

other

interests
™

who sell investment
from general pro¬
or

of

managing the portfolio of
The
de-3 the companies for their personal

was

prevent fraud

companies,

markets,

Investors

the

remove

tier

a

been

the Commission
regulation over

of

measure

some

of

the, complaint that the defendants had

and

Investment

action to

an

tal

essential to the nation's economic

the Commission

case

management
ment

race-

high salaries.34

brought

Con¬

two

enter-

officers of the

as

In another

any one year.

were

Investment

signed

track at

than

more

Advisers Act31

vestment

also

issued

be

if

$250,000 is issued in

It

race-track

It is not insignificant that
management
then
elected

prise.

other debt securities issued under

(503)

of

seven

all
rfl,

the

to

the

road

and

according

Georgia

distributing shares of the Ameri-

subsidiaries by purclias-

the
...c

road's
^

common

investors

Corporation, which

and
anu

preferred stocks tendered by mi-

...

are

beinS offered to t e pu

c

The Commercial

32

and

Chronicle

Financial

(504)

Continued

jrom first page

magic figure. Fewer observers take the
look carefully and intelligently into the com¬
this

in

trouble to

position of this measure of the volume of business done
or to try to reach an understanding of what they find.

|

Changes Reflected
highly important changes are reflected
of data. Take for example, the role of govern¬

A number of
in this

mass

As almost every

ment.

schoolboy knows by now, the mar¬
of all goods and services in this

ket value of the output

1956 (GNP) came to about $415 billion. It
was only a little more than one-fourth of that amount in
1929. In each of these years capital consumed in the pro¬
duction of these things was set down at about 8% or so.
in

country

roughly 92% of the total amount as a net gain
the year's endeavor. Of this "net national product,"
is called in technical language, amounting to some

This left

from
as

it

in 1956

$380 billion in goods and services, government
look some $80 billion, or somewhat more than

20%. In
3929 there was some $96 billion left after deducting capi¬
tal consumption, and, of this, government took about $8.5
billion, or less than 9%. In other words, government in
1956 took about 20 cents out

of every dollar of net output,

while its take in 1929 was less than
the

cases

figures
there

But

10 cents and in both

exclusive of interest on debt.
other evidences of the vast growth in

in the economic affairs
of the nation. In 1929 wages and salaries paid throughout
the country totaled a little more than $50 billion, of which
government paid a little less than $5 billion, or roughly
10% ; in 1956, the wages and salaries bill came to about
$227 billion, of which government's share was nearly $38
billion, or more than 15%. Of course a very small part
of this wage and salary bill in 1929 was incurred by the
military establishment — around 6% — while in 1956
roughly 25% was '"military." But even so some $28 bil¬
the

part played by government

lion of
to

military establishment. Civilian govern¬

with the

do

nothing

total of arouncl $38 billion in 1956 had

a

requisitioned a much larger part of the manpower
the country in 1956 than in 1929—12% against 9% .

ment

of

But

even

these

figures fail by a wide margin to tell

the activities and the
functions of government between 1929 and 1956. In 1956
government took some $12 billion from the public in the
name of "Contributions for Social Security." In 1929 the
the whole

story of the growth in

negligible. Of these and other funds available
to it government made what is known as "transfer pay¬
ments" amounting in 1956 to some $17 billion. Transfer
payments are payments made that have no reference to
services performed during" the year when they are paid.
Such payments in the name of social security now about
equal collections in the name of social security. A very
large part of such collections in the past went into trust
funds and were immediately invested in Treasury IOU's,
the funds then being used for whatever came to hand.

figure

was

Some other
span

changes that have taken place over this

about equally interesting and significant.
income" in 1929 came to a little less than $88

of time

"National

are

billion, of which

some

$51 billion,

considerably less

or

than 60%
took the form of wages and salaries and the
like; of the $344 billion of "national income" in 1956 some
,

$241 billion,
t-on of

about 70%

.

was

in the form of compensa-

employes. This left about 30%

dividends,
1929

or

and

rent

some

42%

other forms

was

left

after

of

to cover all profit,
income

payment

in

1956;

in

of wages and

Workers

Continued

This great

Investors

the wage earner and in lesser degree to the
employe occurred during a period when certain
factors, mainly, of course, higher wages and shorter hours,
have continuously forced business to lay out larger and
larger amounts for labor saving devices and the like. One
would expect in these circumstances that those who saved
and provided the machinery and the other equipment re¬
quired for this type of production would be getting a
larger rather than a smaller part of the net product. Such,
goes to
salaried

however, is not the case, and the fact that there is

such

so

little

for the investor is

certainly not unrelated to the
shortage of investment funds and higher interest

over

current

were

a

is

this concatenation of circumstances




that

lends

of

to

energy

exports
terials

food

of
to

nation.

We

We
raw

and

used

deep

a

effect

the free

ma¬

interest and to re¬
which
had
been
invested in the development of
the United States by foreign in¬

turn

pay

capital

World

Alter

creditor

a

omies.

War

I,

nation.

relatively

few

became

we

We

needed

products

from

abroad.

Therefore, our imports
were
limited. However, we con¬
tinued to try to sell overseas. Our
manufactured goods
became in¬
creasingly attractive to foreign
and

customers

As

consumers.

a

petroleum

became

twenties

in

acute

the

continued

and

late

until

so

to

and

the

United

expedited

reconstruction

for

War

II,

the

situation

Marshall

The

Africa

take

and

exchange
critical.
its

and

The

similar analysis
the entire free enterprise area

for

promptly

research

not

licensees

from

us

we

dollars

more

materials,

billion

$52

abroad

to

to

forced

spend

for

over-seas

raw

is

it

quite likely that
there will be a gradual lessening
of the acute dollar scarcity paral¬
leling the increase in our dollar
payments to the rest of the world.

It is clear that this

of

sion

private

S.

Exports

Challenged

By

American-owned

has

been

added

to

and

factor

penetration

American-

or

sponsored production abroad than
from American

exports.

Conditions
What

Favoring

foreign
the
first

our

the

are

stances

which

New

other

Trend

circum¬

creating such
in foreign
operations amongst American in¬
are

increase of

First,

United

States.

Britain

Great

potentials

growth

greater than those in

are

We

as

think

of

advanced,

an

reported

partment

of

the

by

Commerce

to

De¬
have

been

$2.7
billion. In 1929,
approximated $7.5 billion.

they

tricity, less than 10%
in
use

—

as

United

the

use

In

washing

States.

machines

with

Only
con¬

it

Germany,

over

30%

have

any

of

sumer

the

supply

No

is

units
running hot

the span

subsidiaries

abroad

are

and

manufactur¬

in 1957. This is three times

value

exported

of

last year.

the

In the

abroad to

will be 5:1

is

of

case

States

our

own

in 1957.
of

one

dimensions

in

vital

America
of

modern

the lengthening ox

of life made possible by

pharmaceutical and medi¬

cal

knowledge are skyrocketing
populations, particularly in the
less developed economies. We live
and
must
plan in a period of
'•exploding" populations when the
number of our potential customers
is
being
revised
upwards
re¬
Thirdly, Nationalism brings not

restrictions, but also local indus¬

made

Cutler

of

Commerce

houses

and

without

by
the
is

Messrs.

Depart¬

the

most
we

of

important
One

and

other

inspired

little may be

but
an

leadership

accomplished.

Personnel

tices in

facilities,

dedicated team and

a

energetic,

and

personnel prac¬

overseas

operations

war¬

rant

mentioning two brief points.
First, staffing foreign operations

with

nationals

which

they
provide

to

of the country in
located, if possible,

are
a

economical

more

and

probably
a

a

more

man

moves

from domestic into

tions,
him

foreign opera¬
most important quality for

a

to

is

possess

American

tolerance

—in

which

priate

in

another

g.

essential

are

quite

may seem

n

work

highly competitive

our

omy,

and

under stan d i

methods

successfully—in fact

econ¬

inappro¬

as

country

did

as

of the actions of the
prover¬

bial

Yankee

in

King

Arthur's

Court. Our job as managers is one
of

adaptation

and

combination,

not one of imposition of American
ideas and methods, without
regard

trialization
of

and

the

populations. As

urbanization

more

and more

people become employed in cities
at regular wages, in more or less
skilled
occupations,
growing
middle-class markets
In
a

some

are

created.

countries overseas, this is

unique

development

—

close

to

being revolutionary. It is another
vital

local,,custom,

cause

for the

tradition

and

Prior to World War I and in the

decades

between

the

two

World

Wars, a relatively few American
companies established subsidiaries
of
an

more usual
concept
foreign market penetration was
Export Manager located in an

obscure

couple
and

office,

assisted

by
a
stenographer

of

clerks, a
shipper. In

a

years, when

business

bad

pressure

surplus

ally,

increasing

pur-

cnaoiiig power ox rureigu market...'.

at

home, he

or

of

he

was.

third,

a

contact

no

his

with

fourth

in

president

and

no

long-range

respect

to

or

with little

the

corporation

ticipation
with

under

was

constantly to liquidate
inventories abroad. Usu¬

fifth echelon executive

par¬

planning

product

design,

merchandising and sales strategy,
financial

company

There

only increased import barriers and

comprehensive analysis which
today
on
the
effects

have

mortality and

operations

study of Ameri¬
investment and operations in
and

bricks

mortar,
machinery and inventories, ware¬

was

the reduction in infant

production

excellent

Latin

Second,

and

programs.

Pizer

enterprise.

fine

customers. In years when business

foreign

as
the principal means of
penetrating foreign markets
rather than by traditional export

The

most

any

in

have

Fundamentals

the

increasing

con¬

peatedly.
the

abroad

sales

element
can

Three

are

economies

are

of

new

investment

—

United

goods

the ratio of production
exports from the U. S.

company,

This

manufactured

from

Men

was good
in the United
States, he had great difficulty get¬
ting merchandise for his foreign

sales

rapidly in such
than they aie here.

American-owned

are

if

dwelling
of

wonder

durables

doubtful

more

branches

Discusses

abroad. A far

United

the

likely to be
$32 billion, producing profits at
the rate of about $4 billion an¬
nually. It has been estimated that
overseas

materials and

men,

money.

electric

compaied

trasted with 85% here.

water.

By the end of 1957, U. S. invest¬
ments

business

every

conditions.

and

to

the three

upon

of

—

for

abroad

Prior

enterprise

lion British homes wired for elec¬

World War, our direct investments
aie

the

examine what these

fundamentals

venerable, highly organized econ¬
Nevertheless, out of 14 mil¬

omy.

States, we take
running hot water for granted.
Yet, in countries such as France

operations.

Of

some

businessmen today.

many

abroad
the

interest

such

circumstances

impose

sympathetic

18%

dimension

new

a

a

and

us

conditions

dimen¬

new

market

overseas

94%

U. S. Manufacturing Abroad

Meanwhile,

com¬

investment

production abroad creates

refrigerators
U.

parent

local

foreign operations
planned and conducted

be

today, let

affili¬

panies.

what they needed.

are

output of

overseas

American

vestors and

as

output

operations

the

on

include

the

on

other

or

of

ates

also

but

abroad

enabled

Now,

only

American-owned

of

an

procure

a

of the world. This should

by the United
States during the last 12 years has
friends

under¬

could

suc¬

expended
our

must

in
or

which

today is more likely to come from

World

really

gap.

within

necessary

providing economic aid
military expenditures abroad,

bridged the

Commerce

harden

strengthen

satisfactory one.
Second, when

cessors,

dollars

environment

Ade¬

Australia

economies dramatically.
With this brief review

fully understand what is realiy
of

result.

a

could

or

century. Competition encountered

after

Plan

government

our

South

resources

Argentina,

operation

foreign

became

con¬

as

petroleum

which did not exist earlier in this

for

the supplies

and

goods

States

econ¬

most

a

in

will be stimulated

areas

looking
capital

With much of the world
to

be

development of

resources

and other

taking place abroad if the Depart¬

in

after World War II.

foreign

of

There is

area.

America, West Africa, the Sahara

structive step in aiding American

result, the foreign exchange situ¬
ation

would

It

businessmen and

ment

vestors.

in

production

the thinking

on

enterprise

doubt that the

no

American investment and Ameri¬
can

progress

Petro-politics was involved
when the Egyptians bottled up the
Suez Canal. This action has had

West

wheat.

the

power

of the world.

9

page

and

debtor

ment

rates.

It

from

cotton

as

can

left

electricity, and with
trucks, tractors and
providing
the
modern
means
of
transportation, petro¬
leum is becoming the key source
automobiles,

aircraft

Challenging New Dimensions for
American Foreign Operations

the

rise in the part of the current product that

produce

the

to

currencies

goods
vs.

end

an

Brazil,

ing close to $40 billion worth of

salaries.

is to be

quate

are

are

indication that there

no

gas

monopoly which makes these things possible. At the same
time saving is not growing at a rate sufficient to provide
the capital equipment wrhich the higher wages and ad¬
vances in technology demand. It may be that
higher in¬
terest costs, plus greater discrimination on the part of
lenders, may presently lead to greater conservativeness
in building new plant and the renovation of old despite
the competitive urge—not to say the necessity—to do so,
but in any event it is not easy to see how industry can
continue to pay higher and higher wages—certainly in the
absence of outright inflation which could not fail to bring
itself to an end within a brief span of time.

tion, arid there are a good many, including some politi¬
like to plan for and boast of still further in¬

cians, who
creases

is

there

are also in an era of
petro¬
politics. With oil and natural
being used more and more to

leum

the

We See It

As

We

peculiar interest, to say the least, to the question of how
future is to work itself out. Wages are still rising,
the unions are growing more and more restrictive and

x

Thursday, August 1, 1957

...

still

are

panies

today
of

concept

and

peddle

which

they

are

in

this

selling

fewer. If

goods

etc.
com¬

follow

foreign

fortunately,
fewer

policies,

American

but,

becoming

you

wish to

Puerto

Rico,

Venezuela. Cuba, or the few other
countries

lars,

which

then,

have

perhaps,

ample dol¬

you

can

satisfied with this approach.
ever.

under

overseas

be

How¬

today's conditions of

trade

and

international

Volume 186

Number 5660

economic

development, it is

solete

the horse

as

and

The Commercial and Financial Chronicle

...

ob¬

as

buggy.

tation,

appropriate labor force,

an

channels

distribution

of

(505)

loaned

amounts

Modern

to

but

experience

necessary for success.

indicate

that

not been

Manager

Today's
factors
of

complex

have

created

executive

company's
A

international
a

for

his

operations.
Manager of Foreign

overseas

modern

Operations

finds

himself

market

and

day,

negotiator

financial

to

be

analyst

a

to¬

of

prospective
manufacturing licenses tomorrow,
a

member

of a foreign board of
representing his com¬
pany's minority stock interest, and
a

directors

consultant—in

a

the

Suggests New Source of
So

type

new

responsible

management

but

let

Until

and

military

by

expenditures made
United
Slates
overseas

the

during the last 12
the

up

level

tne rate

world

ployment

way
so

ministrator with proven ability to
coordinate into an effective team

free

specialists

every

the

of

various

functions of business.
He

is responsible for exporting
American-made
goods to
coun¬
tries which have sufficient dollars
to

buy them and also, for export¬
ing similar goods made abroad to
countries which

other

can

buy only with

currencies.

responsible for
wholly-owned for¬

eign subsidiaries for which he
implements the full range of man¬
functions.

agement
sist

He

must

as¬

local

operating management
arranging adequate finance,

in

personnel

development, manage¬
succession, provision and

ment

maintenance

of

the

economical

pro¬

duction facilities, production
schedules, sales objectives, cost
control,
and, finally,
personnel
training and development includ¬

outspending
Capital has
terest

terially.
desire

In

relationship to overseas
licensees,
he
exercises
similar
management functions—but often

advisory rather than

a

direct

manner.

Even this brief definition

functions
of

of

Foreign

clear

that

modern

a

Operations
he

of the

Manager
makes

it

only discharge
responsibilities
well
with

these

can

the closest collaboration of his
top

management

in
integrating the
domestic
planning, policies and
organization of his company with
its program for foreign
operations.
He

in

be

must

constant

contact

with his company's senior execu¬
tives on finance,

manufacturing,

selling and research
that

means

of

the

which

—

modern

Manager

Foreign Operations needs to be
member

a

of senior

top manage¬

ment.

How

he

can

know

whether

or

not to

plan for another subsidiary
operation abroad unless he knows
his

corporation's

program.-

With
tion

-*

today's

of

financial

-

•.

try take

to

announced to the American

through

domestic

known to
tors

most

,

public
advertising is

overseas

distribu¬

bankers

their

and

be

can

within

foreign
upset

nouncement

selling

tion

by

domestic

a

campaign of which foreign
tions

uninformed

was

launched its

own

top

leading

an¬

sales

opera¬

when

it

which

have

success

ognize

managements

of

the

corporations,

attained

the

such

cause

foreign operations,
these principles with

utilize

capital

primarily

tooling

for
inventories

and

licensed

newly

New

is

special

.

the

of

products.

How¬

and

re¬

organiza¬

respect

second

foreign
basic

to

"materials"

fundamental

enterprise,

—

considerations

United

States.

in

the

apply

—

anv

same

as

in

There must be

an

adequate, economical source of
supply of raw materials, transpor¬




objective

to

has

consequence,
let us bring
these elements together into ail

it be if these funds,

local

demand

for

better

a

life is expressing itself vigor¬
ously throughout the world. The

resultant

for

demand

goods

services is

to

creating
a
world-wide
shortage with increasing

competent private borrowers—
Americans or others
for
—

local

investment

in

produc¬

new

tive enterprises. This would make
it possible for American private

enterprise

often

—

in

association

with local interests—to undertake
additional

projects abroad, create
opportunities and par¬

job

new

ticipate

materially
in
economic
development toward higher stand¬
ards of living. It would enlist the
full

knowledge, competence, and
experience of the American busi¬

the

of

nations

vanced

the

primitive
The

plan

Congress
has
through
Public

local

per

resources

be

established

and

profitably
existing conditions.
If

tne

wishes to take

Congress

enlightened,

most

under

viewpoint toward

created

of

pool

a

perhaps $1
these cir¬

In

year.

a

480

Law

cumstances, is the time not ripe
the
American,, Government

which

can

more

for

American

combine

to

private

these

enterprise

local

currency

dollar funds

and

avail¬

able

through a bona fide,
military,
economic
foreign
program?

Such

aid

could

program

a

non-

tions,

one-half

—

30%)

(or

be used for public works, in¬
cluding highways, irrigation, pub¬
lic buildings, hospitals and schools

—the

other

half

augment

or

services

such

to

be

used

to

improve fundamental
as

communications

transportation,
the

and

genera¬

to

respect
it

remaining
should stipu¬

Congress

late

that

to

be

earmarked

lending to private industry—

one-half
U

is

n

to

ited

through
while

be

loaned

States

by

the

other

the

Government

Washington

a

of

half

agency

is

loaned

through a local financial
designated by the foreign

govern¬

agency

well

as

type

a

ing

to

Field Day will
13,
1957 at the
Medinah Country Club. The usual
be

held

Sept.

dinner

on
Thursday night preceeding the Field Day will be held al

the

University Club of Chicago.

Members
the

Field

of

the

Day

committees for

are:

Raymond V. Condon, General
Chairman, B. J. Van Ingen & Co.,
Inc.

Arrangements

Chamberlin,

William R.

—

Chairman,
Halsey,
Inc.; Gene A. Frantz,

Stuart & Co.

Frantz Hutchinson &

Co.; Paul L.
Hackbert, Rodman & Renshavv;
Carl H. Oilman, Dean Witter &
Co.;
George
R.
Smith,
Glore,
Forgan & Co.; Carl T. Swanson,
Continental Illinois National Bank
& Trust Co.

em¬

lead¬

power,

consumption, economic and politi¬
cal stability, and a better way of
life.

such

joint

a

—

suited

best

earning

more

the

to

as

each particular economy,

to

Through

the

40%, the
for

nations

ployment

tion of electric power.

With

that

announces

Annual

pany.

to

question

Municipal Bond

Chicago

cluding local production and

funds,
it
might
well
stipulate that 60% be loaned back
the government of the country

of

21st

an
effective public and
private development program in¬

vanced

hundreds of millions of people in
the relatively primitive new na¬

in

Club

Softball
Walter A. Hintz,
Chairman, A. G. Becker & Co.
Incorporated; Phillip F. Koenig,
C. F. Childs & Company; Blair A..
Phillips, Jr., Baxter & Company;
Robert J. Taaffe, Baxter & Corm-

to both the older, more ad¬

carry

the fuller utilization of these local
currency

President of The
the

attrac¬

of

well generate

currencies

billion

ad¬

CHICAGO, 111.—Arthur E. Kirlley,
First
Boston
Corporation,

areas.

which could
of

capital

interest
thus of¬

less

make

is

and

more

development

and

soundly

nations

rates. The opportunities
fered to investors in the

tive

and

exhausting the savings

advanced

community in seeking out
those productive enterprises
ness

way

of

foreign currencies, could
be loaned on an increasing scale

either

Announces Field Day

orderly conclusion.
The

grams would

Cgo. Mun. Bond Club

In

•

Golf—O.
man,

•

Paul

Decker, Chair¬
National Boulevard Bank of

Chicago;

Franklin Bickmore,
Company; Richard
C. Nongard, Nongard, Showers &
Murray, Inc.
Boettcher

J.

and

Prizes

effort,

the Congress and the Administra¬

John

—

X.

Kennedy,

Chairman,

tion

Hiram F.

enlist

can

all

the

American

genius for organization, financing,
production, distribution, personnel
training
and
development,
and
can apply it in the most
enduring
fashion
through
enterprises
in
which

Americans

tionals

local

working

are

under

and

na¬

together

commercial

normal,

White, Weld & Co.;
Bright, Harris Trust &
Savings Bank; Philip W. K. Sweet,
Jr., Northern Trust Company.
Entertainment—Robert C. Haw-

ley, Chairman,
Savings Bank.
Horseshoes

Harris

Trust

&

John P. Ballman,
Chairman, Ballman & Main.
—

in¬

Special Event—Robt. R. Brinker,
Chairman, John Nuveen & Co.,
Inc.; Alan H. Bede, Julien Collins
on
terms
commensurate of such a program can be one of &
sive, it may be more difficult for made
Company; Frederick W. Chanmost
effective
"secret
local
enterprise to raise capital with conditions prevailing in the the
ner, Channer Securities Company,
funds than for an American com¬ country in question. In addition, weapons" of the United States in J. David
Everard, John Nuveen &
the terms available to private in¬
winning the cold war or main¬ Company;
pany to do so at home.
Charles A.
SchoeneThere is, I believe, another very
taining the peace. Organization of berger, Central
dustry through Washington or the
Republic
Com¬
simple answer, merely awaiting local financial agency must, of such a program on a basis which pany; Paul T. Stephens, Paine,
is equitable to both the Americans
implementation
by
Washington necessity, be the same.
Webber, Jackson & Curtis.
arid the businessmen and workers
officials, through a mechanism
local
Such
currency
loans to
Reception — Arthur E. Kirtley,
which
has
already been estab¬ private industry provide an added of the country in which each
Chairman, The First Boston Cor¬
lished. I am referring to the use source
of capital in a wide-world project may be undertaken, is one poration; James P. Feeley, First
of the greatest challenges which
of the
funds obtained from the
Union
Trust
&
tight capital market.
Savings
Bank;
American industry ever has had
sale of our commodity surpluses
Walter J.
Fitzgerald, Jr., Blunt
the opportunity to accept.
to foreign countries for local cur¬
Sees Devaluation Prevented
Ellis & Simmons.

in

ever,

countries

many

abroad

where money is tight and

A

few

State

weeks

Dulles

Senate

ago

Foreign

for

providing

a

means

true

the

to

Relations

Committee that

In

Secretary of

proposed

Sub-

be found

non-military

economic

addition, the

use

Foreign

is

ence

480

to

this

be

agricultural support
enacted by the Con¬

the Commodity Credit Cor¬
poration purchases certain sur¬
gress,

plus commodities from our farm¬
ers.
Today an inventory of over
$7 billion worth of such commodi¬

To

in

storage.
these

move

commodities

to

nations in need of them, the Con¬

enacted

gress

authorizing
State

to

with

the

which

sales

have

480

of

agreements

foreign
the

the

in

Law

Department

make

Contracts
lion

Public

friendly

paid

countries

purchase

buyer's

guidance

of

enterprise.
Manufacturers

Our

price

totalling almost $3 bil¬
been negotiated.

With

seas.

could
that

such

report

a

to

foreign aid

American

plan, Congress
its constituents

programs

of

are

overseas
a

standpoint

of

the

country involved in such

it will bring to it a
rapid influx of American

program,

know-how;

a

and

a

willingness

greater

of Americans to

invest;

corresponding

more

jobs

increase in
greater

local

purchasing

skills

to

thorized

demand for collateral services and

they

came

currencies

which

keep a portion
on-the-spot official American
The

policy

or

to

Administration

guidance

that

25%

has

of

a

the

local

activities

power;

populations; and

will

create

Avenue.

local investment, business

activity

and

jobs.

founda¬

tion

stones

political

These
of

are

both

stability.

the

economic

and

Weld

&

Co.,

20

Jr.,
firm

is
as

Pike

H.

Associate Member

Event—Edgar

Grimm, Chairman, F. S. Moseley & Co.; Bruce H. DeSwarte.
Tennis—De Witt Davis, Chair¬

man,

Mullaney, Wells & Co.

Bowman

Appt'd by Blair

exchanges, an¬

nounced that Charles
become

has

E. Bowman

Manager

of

their

Flint, Mich., office, Sill Building,
succeeding the late William R.
Stokely.

With H. Carroll & Co.

Broad

Sullivan,

associated with the
registered representa¬

now
a

New

F.

(Special to Thf, Financial Chronicle)

New York City, members
of the New York Stock Exchange,
that

Event—

Marine Trust Co. of Western;

Street,

announce

Member

Stone, Jr., Chairman, The

York, New York.

White, Weld Adds

HILLS, Calif.—Har¬

BEVERLY
old

K.

the

to

Hampton
staff

North

324

of

has been added
Carroll & Co.,

H.

Camden

Drive.

tive.

With
Malcolm

a

additional

Non-Resident
Fred D.

leading securities

Greg—Richard Carmody and Elmer J- Johnson are
with Foster & Marshall, 55 West

White,

Vincent New¬

FLINT, Mich.—Blair & Co. In¬
corporated, members of the New
York Stock Exchange and other

(Special to The Financial Chronicle)

10th

—

Chairman, Allan Blair & Co.;
Arthur G.
Field, Lee Higginsort
Corporation;
Wilbur
G. Inmam
John Nuveen & Company.

with

EUGENE,

economy.

the

From

Gov¬

such

affiliated

become

G.

Leonard

N.

Foster Marshall Adds

tural and industrial sectors of the

these

country from

Mo.—John

Abbey

direct benefit to both the agricul¬

with

loan

CITY,

and

George

Baltimore Avenue.

States

to

KANSAS

George K. Baum & Company, 1016

United

the

George K. Baum

continuing need for such com¬
by
foreign
countries
abroad, we have the prospect of
a reasonably steady flow of funds
in local currencies for both pub¬
lic and private investment over¬

currencies, the International
Cooperation Administration is au¬

use.

Two With

a

credited

to

enter¬

modities

is

back

free

have

the

ernment

and

dis¬

the various support programs, and

more

for

businessmen

as

and

(Special to The Financial Chronicle)

purchase of
commodities
under

continuing

agricultural

currency.

Utilizing Par Value Credit
When

the

under

With

our

programs,

Operations—the experi¬
had already in or¬

have

prisers, to carry our part of the
responsibility for the success of
such a joint program.

And Farmers

Under

ties is

alone

great encouragement

a

Aid

Would

which the

risk

greater industrial development

overseas

provide the mechanism
Secretary of State was

can

we

Transportation
man,

tribution abroad has prepared us,

of

American private

Law

direct

Avoidance

action

Public

a

American

in

ganizing for production

should

by

when

present

organization

thought that the

Dimensions

New

change risk of devaluation which
always

the

dollar investment is made abroad.

aid, on a long-range
basis,, through an Economic De¬
velopment Fund. The sequence of
envisaged

ex¬

that

I commend the

of such local

currencies eliminates the

believe

I

Obviously, such loans should be

under Public Law 480.

rency

centives.

ments

expen¬

local

With

the

abilities to

arrangements

licensee.

required

rec¬

tion.

the

and

existing basic facilities of the

greatest

in

spect to personnel

opera¬

through the
enduring relationships of private
endeavor and private enterprise?
The
manufacturing license
agreement is a partial answer be¬

under

plans.

American

foreign

increase local produc¬
How can economic

or

appears

to

conditions, how do

new

aid be made available

is

The

considerable

abroad?

a

program

completely

of

worldwide

goods and better

a

useful

ma¬

advantage of the desire

establish

maximum of three weeks. A well-

planned

the

know-how

American

foreign business¬
bankers, any change of
model or sales approach

price,

increased

this

enterprise,

to our foreign aid
development
pro¬

and in¬

How does American indus¬

for its

dissemina¬

of

and

men

savings.

private

foreign

seeking.

rapid
and

news

publications

future

..

So

come.

finance

tions?

How

an

Under these
we

the

parent company for train¬
ing and instruction.

of

scarce

have

more

period to

of

factories

in

the

living, capital will continue rela¬
tively scarce and interest rates

overse.—.

and

but

of

well.

as

rate

grown

With

for

the

an

area

its

rates

the

office

States

countries

find that substantially
advanced country is

we

to

in

United

more

ing the bringing of local nationals
home

fed.

was

requires
investments
not

major

enterprise

today,

of life

relatively high for

He finds himself

the welfare of

in

more

created

capital

other

as

—

em¬

purchas¬
larger, the desire

better

alone
the

As

earned,—as

grew

demand

The

record

all

heights.

increased,

were

director, economist, negotiator and
diplomat. More probably, he is a
capable analyst, planner and ad¬

in

employment and

record

a

personnel

of

of production around the

to

for

financier, manufac¬

pro¬

vided the life blood which stepped

He must

executive,

has

years

actual

and

in
the $52 billion of aid

now

power

a

final—

element,

—

"money."

ing

be

Capital

the

important

wages

sales

consider

us

most

engineering sense—to licensee and
subsidiary company managements.
turer,

Conclusion

be

reached.

proper

Foreign Operations

should

back

channeled

and all the similar other elements

33

McAlpin, Dir.

Malcolm E. McAlpin, partner

in

and Company of
New
York, was elected
to the
Board of Directors of Hiller Heli¬
copters, it has been announced by
President Stanley Hiller, Jr.

Talcott,

Potter

Hemphill, Noyes

(Special to Thf Financial Chronicle)

LOS
M.

ANGELES,

Hackathorne

Calif. —Cecil

is

now

Hemphill, Noyes & Co., 628
Sixth
....'(1.

Street.
A l.in_T

He

omhorf

was
Cfl

with

West

formerly

34

The Commercial

(506)

Continued

G. H. Gillies With

from

4

page

Phillips Securities
(Special to The Financial Chronicle)

MILWAUKEE, Wis.—George H.
Gillies has become associated with

The State oi Trade and
and

Industry

Phillips

They added that they need more money to
expand capacity from earnings. British iron and steel scrap prices

North Port

were

Securities,
Inc.,
5856
Washington Road. Mr.
Gillies was formerly an officer of

First Trust Co.

Milwaukee

of

for

In the automotive

industry United States assembly plants in

for

PALM

BEACH, Fla.

Keshen is

now

with

Inc.,

—

Se¬

Harvey

With Allied Securities
(Special" to The Financial Chronicle)

ATLANTA,
Hoover, Sr., is

Ga.
now

—
James
C.
affiliated with

Securities

Corporation, 87
Walton Street, Northwest.

Joins Union

Security

(Special to The Financial Chronicle)

CHICAGO,
111. — Wallace
S.
Remington has joined the staff of
Union Security Co., 29 South La
Salle Street.

With Myrl D. Maynard

Reports" stated

added IBM with

"Ward's"
booked

curity
Planning,
Building.

Allied

ton, this trade publication further reports.

a

''Ward's Automotive

Security Planning

WEST

.$2.50

are producing 9% more passenger cars than in the same 1956
month and year-to-date output is running 5.5% ahead of last year,

(Special to The Financial Chronicle)

Fred A.

boosted

July

many years.

With

transport costs.

on Friday, a week ago.
assembly of 118,327 passenger

week, paralleling the previous week's 117,207, a
strong 490.000 car completions are in prospect for July. In 1956,
July volume was 448.876 units.
The past week's car building brought to 3,794,000 the number
built since Jan. 1. Thus 1957 operations are running 5.5% ahead
of a year ago when 3,597,700 cars had been completed.
Ending its 1957 model car assembly on Friday, was Rambler,
winding up American Motors Corp. operations for the model year.
Hudson and Nash 1957 output ended a month earlier, the statistical

declared, adding that five car makers have ended 1957 car
Rambler on July 26; Lincoln, July 22; Nash and Hud¬
son, June 28 and Continental on May 13.
Marring operations last week, "Ward's" said, was a wildcat
strike at the Chrysler Corp. plant at Mack Ave., in Detroit. It cut
into Plymouth operations.
Truck manufacturing, meanwhile, held steady the past week,
the month's estimated volume running to 92,000, fully 9% over

assembly.

July last

111.

—

P.

Myrl

Maynard

D.

&

Co.,

State

Bank Building.

recent

industry the nation's crude oil stocks continued their

advance

by rising an additionol 5,424.000 barrels in the
July 20 to a total of 285,882,000 barrels, the United
States Department of Interior reported.
to the agency's report, stocks of foreign crude
by 468,000 barrels, but this was more than offset by a
5,892,000 barrel jump in supplies of domestic crude.

According

week.

Reports from
week

Ashton

period, but 0.2%

&

Co.,

West

15315

ended

National

McNichols Road.

week

497

July

20

lumber

mills

showed

orders

new

for

larger than for the preceding
below the like week last year, according to the

Lumber

were

9.6%

Manufacturers

Association.

Production

for

the

was

(Special to The Financial Chronicle)

ST.

Gordon

The valuation of building permits issued in 217 cities includ¬

Davis has become associated with

New York during June again fell slightly below the cor¬
responding 1956 month, Dun & Bradstreet, Inc., reports.
The
aggregate for last month was $543,893,626, a decline of 2.7% from
$558,856,212 for June a year ago. A comparison with the May
figure of $560,278,567, revealed a drop of 2.9%. Among the
geographical regions, the South Atlantic and the South Central
were the only ones to report increases in permit value totals over

LOUIS, Mo.

—

L.

Newhard, Cook & Co., Fourth &
Olive
Streets, members of the
New

York

Exchanges.
merly

and

Mr.

Midwest

•

Davis

Stock

for¬

was

the Utilities

officer of
Insurance Company.
an

ing

June last year.
For New York City

With Ratterman & Co.

alone, building permits for June were up
$55,200,493 from the $50,349,355 for June last year, but

.9.6%

CINCINNATI,
Walsh is

now

Ohio—James

affiliated

terman & Co., 311

P.

with Rat¬

Pike Street.

to

were

(Special to The Financial Chronicle)

down

13.3%

Building

below

permit

the

values

the

217

reporting cities for the
first half of 1957 continued slightly above the 1956 volume de¬
spite the fact that four of the elapsed six months of this year
showed declines from a year ago. The cumulative total for 1957
reached
and

a

$3,088,103,233, or a gain of 1.2%
high record for the period.

over

the preceding year,

that the
having 96.1% of the steelmak¬
ing capacity for the entire industry will be an average of 82.2%
of capacity for the week beginning July 29, 1957, equivalent to
2,103,000 tons of ingot and steel for castings, as compared with
79.4% of capacity, and 2,033,000 tons (revised) a week ago.
The industry's ingot production rate for the weeks in 1957
is based on annual capacity of 133,459,150 tons as of Jan. 1, 1957.
For the

duction

Iron

like week

2,009,000 tons.

AFL-GTO United
The

based

are

rate

capacity

on

an

A

year

is

Of
Steel

at

82.2%

Ingot Capacity

1.5 points to 79.5% of rated
capacity last week, but producers are encouraged by signs of in¬
creasing demand, "Steel" magazine stated on Monday of this
week. The week's output was
2,035,000 net tons.
The metalworking weekly noted that
steelmakers, are opti¬
mistic even though July tonnage will be the smallest for
any

not

1956.

February, 1955.
industry anticipates a strong pickup, pinning its hoDes
for an active fall and winter on a
sharp revival in automotive
requirements. A substantial gain in appliance needs and gen¬
eral improvement in demand is also looked for.
With inven¬
tories low, buying for current needs and for
stockpiling is expected.
For

This

The amount of electric energy distributed by the

yourfuture
How does it look? Rosy? Free
of cancer? You

hope! But

hoping isn't enough. Of every 6
Americans who get
year,

cancer

this

3 will die because science

•till has

no cure

for them. It will

take lots of research to find that
cure.

Pitch in and

generous
to

help. Send

check right

"Cancer" in

most

products, availability will likely exceed demand.
increased capacity will make for
supply conditions over the coming months. There is reason
to believe that both items will come into reasonable
supplydemand belance by the end of this year.

is looking into

structurals and plates,

care

a

now




down.

below

cline

the

previous period.

week's output decreased 63,000,000 kwh. below
that of the previous week; it rose 948,000,000 kwh. or 8.4% above
the comparable 1956 week and 1,516,000,000 kwh. over the week
ended July 30, 1955.
The

past

Loadings Rose 7.4% Above Prior Week Which Was

Car

Miners Annual Vacation

Affected By the

Loadings of revenue freight for the week ended July 20, 1957,
increased by 51,368 cars or 7.4% above the preceding week, which
was
affected by two davs of the coal miners' annual vacation,
the Association of American Railroads reports.
.

,

bolstering expectations of a good year are initial
reports of first half earnings of nine steelmakers which are
slightly better than a year ago. Gross National Product in the
first half too, registered a 6% gain over that of the same
period
last year, reaching
an
annual rate of $433,500,000,000 in the
second quarter.
;
production

index

averaged

158

for

the

first half of 1957, compared with 155 in the
corresponding period
last year (1947-1949=100). The index is made up of steel
output,
electric power output, freight car loadings and auto assemblies.
tion

*

industrial

publication

bounced

back

declared
after

the

that

the

way

July

4th

holiday

industrial

It said to look for machine

tool industry

produc¬
that the
weaknesses

shows

over-all economy is still strong enough to overcome
of some of its major parts.

at least

1957, totaled 743,359

week ended July 20,

Loadings for the

increase of 94,867. cars, or 14.6% above the corresponding
1956 week, when a nationwide steel strike was in effect, but a
decrease of 38,549 'cars, or 4.9%; lower than the corresponding
an

cars,

1955.

in

week

V

,

U. S. Automotive Output in
1957

output for

the Latest Week Brought

Ahead of

Operations 5.5%

Automotive

a

Year Ago

the latest week ended

July 26, 1957,

"Ward's Automotive Renorts," brought oar build¬
ing to 3,794,000 units thus far this year, or a gain oi 5.5% above
1956 operations.
Last week's car output totaled
118,327 units and compared
according

duction

gain
states

to

(revised) in the previous week. The oast week's pro¬
trucks amounted to 139,776 units, or a

total of cars' and

above

of 576 units
"Ward's."

Last week the agencv
in

United

the

and

States.

21,426

a

that of

preceding week's output,

the

reported there were 21,449 trucks made
with 21,993 in the previous,

This compared
ago.

year

•'

>

.

above that of the previous week

21,426 trucks were assembled.
In Canada last week, 8,075 cars-and 1,591 trucks were assem¬
bled

as

9,169

against 7,689

cars

cars

and 1,664 trucks the week before, and

and 2,161 trucks in the similar period a year ago.

Business Failures Declined the Past Week to Lowest
Level in Three-Week Period
Commer.bial

shipments to reach

$950,000,000 in 1957, compared with $886,000,000 in 1956.

and

industrial

declined

failures

to

228

in

the

July 25 from 266 in the preceding week, Dun &
Bradstreet, Inc., reported.
At the lowest level in three weeks,
the toll fell below the 274 a year ago, although it remained above
the 201 in 1955.
Failures were 22%*.less numerous than in the
ended

week

comparable week of pre-war 1939 when 291 occurred.
Casualties involving liabilities of $5,000 or more dipped to
195 from 227 in the previous week and 225 last year. A decrease
also occurred among small failures with liabilities under $5,000,
which were down to 33 from .39 a week ago and 49 in 1956. Six¬
teen businesses failed with liabilities in excess of $100,000 as
.

against 23 in the preceding week.
All industry and trade giroups except manufacturing had
lower tolls during the week. Retailing casualties declined to 115
from

146, wholesaling to 15 from 22, construction to 35 from 38
service to 12 from 20, The contrasting increase

commercial

and

Factors

The

of your

local Post Office.
American Cancer Society

The general business outlook is that 1957 will be as good as
1956, perhaps slightly better, according to this trade weekly. The
important difference, however, will be that while the over-all
trend in 1956 was generally up, the trend this
year is slightly

"Steel's*'

electric light

industry for the week ended Saturday, July 27, 1957,
was
estimated at 12,243,000,000 kwh., according to the Edison
Electric Institute.
Output the past week registered a slight de¬
power

-

easier

man

Slightly Below

Output Last Week Eased
Prior Period

The

Even in

result of the strike by

by 1,120 cars, while truck output declined by 544 vehicles during
the week.
In the corresponding week last year 111,247 cars and

ingot production declined

non-strike month since

the actual weekly production

1956.

in

Last week's car output rose

Steel Production Scheduled This Week

the rate was 78.5% and pro¬

ago

ago

comparable because capacity is
The percentage figures for 1956
anr.ual capacity of 128,36.1,090 tons as of Jan. 1,

operating

than

higher

month

a

tons or 16.9% as a
Steelworkers Union.

p'aced at 415,000

was

the

week

new

ton, it's off another 33 cents.
and Steel Institute announced

gross

operating rate of steel companies,

with 117,207

$63,632,718 for May.

for

a

American

the

reported 24% above the July 13 week, but 8.6% below
1956, while shipments exceeded the preceding period by 16.2%
and trailed the year-earlier pace by 3.2%.

Newhard, Cook Adds

At $54

The

(Special to The Financial Chronicle)

DETROIT,
Mich. — Mary
H.
McKay is
now
affiliated with

It remained at $146.19 a net ton

finished steel.

Scrap prices continued to ease. The publication's composite
the steelmaking grades dropped for the fourth consecutive

and

ended

week

.

.

week ended July 24.

in the

Electric

dropped

Ashton Adds to Staff

base prices of

on

year.

In the oil

George

Smith has become connected with

1962, compared with

by

recreation

on

.

Considering mid-July sales trends, the auto industry is run¬
ning into a month-end buildup in its new car dealer inventory
following sizable reductions in both May and June, "Ward's"

reported.

annually

$20,000,000,000

$14,300,000,000 this year.
/
In the steel market, price schedules are still being revised
but are not reflected this week in "Steel's" arithmetical composite

agency

(Special to The Financial Chronicle)

FREEPORT,

Shipments of $83,100,000 in June were up 5.8% from May s and
reduced average backlogs to 4.2 months.
The best year in the history of the industrial rubber goods
industry is in sight. Estimated sales this year are put at $1,200,000, or a 3% gain over, those in record 1956.
The leisure market is expanding. Americans will spend nearly

on

cars

last

August 1, 1957

Financial Chronicle... Thursday,

and

among
cerns

manufacturers lifted their toll to 51 from 40.

failed than last year in all lines.

*

Fewer

con¬

.

Wholesale Food Price Index Advanced for Fourth

Straight Week

*

Rising for the fourth successive week, the wholesale food
price index, compiled by Dun & Bradstreet, Inc., went to $6.35

July 23, from $6.31 the week before, to set a new high since
1955 when it stood at $6.42. The current figure repre¬
sents an increase of 4.4% over the $6.08 for the corresponding

on

June 28,
date

a

year

ago.

Higher in wholesale price last week were flour,-corn, barley,
hams, bellies, beans, eggs, hogs and lambs. Lower in cost were
wheat, rye, oats, lard, sugar, cottonseed oil,, cocoa and potatoes.
The index represents the sum total of the price per pound
of 31 raw foodstuffs and meats in general use and its chief func-

Volume 186

tion

is

Number 5660

to show

level.

•

,.

The Commercial and Financial Chronicle

.

the general
'

trend of food prices at the wholesale

another

was

rise

in

commodity price movements last

On Monday, July 22, the daily wholesale commodity price

week.

index, compiled by Dun & Bradstreet, Inc., stood at 293.59, up
slightly from the 293.48 of the preceding week and moderately
above

the 286.51

of the

corresponding 1956 date.
A rise in prices on most grains occurred the
past week. In¬
creased
trading in corn moderately boosted prices.
Although
purchases of wheat slackened, prices exceeded those of the pre¬
ceding week.
Wholesalers reported a considerable increase in
soybean prices, as transactions rose noticeably. The record level
of soybean trading was attributed to
pessimistic surveys of crop
conditions.

«

Reports

indicating favorable growing conditions, resulted
in a slight price decline in oats futures
prices, last week, but trad¬
ing expanded noticeably. Total purchases of oats on the Chicago
Board of Trade amounted to 44,108
bushels, compared with 21,375 bushels in the prior
week and 23r638 bushels a year ago.
Transactions in soybean futures in Chicago totaled 155,927 bushels
as against,
92.265 bushels a week earlier and 85,239 bushels last
year.

Many flour wholesalers reported a rise in bookings a week
ago and prices climbed appreciably. At 38,012 sacks, flour receipts
at New York railroad terminals on
July 19 were noticeably below
those of a week earlier.
Of the total for the latest date, 31,862
sacks

were

for

export and

Buyers stepped
and prices moved
•

6,150

up

for domestic

were

in

decrease

a

cotton

legislation

resulted

but increases prevailed at the end of the period when no
price supports seemed likely before 1959.
Average daily consumption of cotton in June was estimated
at 33,300 bales, according to the New York Cotton
Exchange as
compared with 33,600 bales in May and 32,400 bales in June
States

exports of

cotton

staple in the week ended
last Tuesday totaled about 105,000 bales as against
73,000 bales in
the previous week and 18,000 bales in the similar week last
year.

clearance

Below to

a

sales

promotions

Summer

on

merchandise

week ago with

gains in suits, coats, dresses and sweaters. Sales
of Summer sportswear and cotton dresses slipped
slightly. While
interest in men's Summer sports shirts expanded appreciably,
the call for lightweight suits lagged.
A slight rise -occurred in
purchases of furniture, some major appliances and air condition¬
Traditional

ers.

white

sales

promotions

stimulated

interest

in

linens, and volume exceeded that of last year. Grocers reported
continued buying of picnic specialties, fresh meat, ice cream and
dairy products, while volume in canned goods sagged. There was
a

moderate rise

sales

and

in

volume

clnse

were

both

in

those

to

of

and

new

a

used

retail

trade

from

was

1%

period ended

below to 3%

on

higher than

according to estimates by Dun & Bradstreet, Inc.
Regional estimates varied from the comparable 1956 levels by
the following percentages: New England and West North Central
-fl to 4-5; Middle Atlantic, South Atlantic and West South Cen¬
a

ago,

year

tral

0

to

4-4: East North

Central —3 to

4-1; East South Central
4-3 to 4-7; Mountain and Pacific Coast —1 to 4-3%.
There

ens

and

creased

was

a

moderate rise the past week in

orders for wool¬

worsteds, as many apparel manufacturers planned in¬
production schedules in the next few weeks. Transactions

in carpet wool in Boston and Philadelphia expanded appreciably.
Limited retail stocks stimulated the buying of men's and women's

Fall

apparel and re-orders for Summer merchandise.
Attracted
by showings in New York and Los Angeles, buyers stepped up

their orders for curtains and draperies and the volume

higher

than

television

a

the

sets

Transactions

year

ago.

were

in

major

was

slightly

sluggish.

Department
from

store

Federal

sales

Reserve

on

country-wide

a

Board's

index

for

appliances
basis

the

as

week

and

taken
ended

July 20, 1957, increased 5% above the like period last year. In
the preceding week, July 13, 1957, an increase of 5% was reported.
For the four weeks ended July
20, 1957, an increase of 4% was
recorded. For the period Jan. 1, 1957 to July 20, 1957, an increase
of 2%. was registered above that of 1956.
Retail
vanced

trade

volume

6% to 8% above

estimates

by

trade

in

stores,

New

York

the like period

resulted

combined

a

the

year

in

the
the

past

ago,

week, together with
largest volume

of

with

ability,

is

week

We

the

Selection

of

promotions by

sales

for

electric

setting

standards

up
the various

guidance

which

important
ered in

to

of

sources

the financial

available

are

centers.

criteria

evaluate

investment
to

Among the
be

to

consid-

procuring assistance in the

investment of union pension funds
are
the following:
(1)
Uj

Is
is

the
me

prospective
prospecme

adviser
aaviser

Guidance

(2)

(2)

Is

pension

umque

tailored to

fund

require-

rnents

continuous'6 poltfoll° supervisIon
frer

t

.

(1)

,

Is the adviser impartial and

from

ronflipfs oi interest.
conflicts of inforpst?

Measures of investment

com-

petency.
Thp
lne

selection
selection

adviser

lar

in

is

to

that

of
oi

of

investment
investment

on
an

respects

many

choosing

snni-

doctor

choosing a
mai oi cnoosing a aocioi
lawyer. And all too frequently

it is done

the

on

a

basis;

same

reputation.

the

geo-

are

formal

no

requirements,
pass,

Furthermore

in

educational

examinations to

no

license

or

be

to

granted,

Soenrilv
Security armlvcts vnrv m quality
analysts vaiy in mnlilv
as well
as in specialties.
Starting
<?erateh
sciatch,

from
liom

in

Qeienfifie
scientific

a

in

proach, to select

a
a

-m

ap-

securities

be

consideration to

measure

man's competency

(a) Technical education in busi¬
and

security

have

to

^

period of 1956.




4%

above

that

of

the

corresponding

any

pension

effective, advice has
according to the

required,

but also

economic vision
\K>>

(b)

nuw

How

(c)

How

prac¬

in

heart.

Tnese

lawyers, because
education and as

affairs,

man of
siderable

may have con¬
investment understand-

}ng* ?n the other hand, he may

nolirv

well

-is

as

sne-

matter of fact, most attor-

a

have so ,Jnucl1 law business

that theY don't have anY tlme to
.

.

,

investment management

super-

specialized busi-

from the

away

of giving investment advice.

ness

A portfolio cannot be success- They recognize their own profesmanaged simply bv taking sional limitations.
Lawyers are
iUU-y nidudgtu
'y,, uyT, p
nf
ahiijfv
hut
hprans^
of
9,1 occasional look at it. It has to men oi
ability but because oi
be Uved wHh
go much can hap_ concentration
on legal matters
fullv

mpn

,

between periodic reviews that
reliance upon such practice would

pen

be highly dangerous.

The owner
securities could be lulled into a

lac^ the technical competence to
advise on investments. It is a most
serious disservice to a client to
something

for

false sense of security under such which you are not qualified.

All

oi securities couia oe lunea into a
One

arrangement

would

not

JxSfuTi? -°1
hhy" a .-security which does not

undertake

purchase

but

pecis at uie time ox puicnase, out

to

often

to°

rassin*

do

lawyer

the
to

on

A1i

merely

is

oenston fund

£f£"£°n ftjpcnston

man-

the latest tips telephoned

favorable pros- a^eis

have

to

appear

from bis broker rather than well
rerommpndations

H

tai-

industry conditions and the man- reasoned^ recommendations

Fhal,ee rather quickly, so that it
to keep constantly
vigilant, or serious Josses could

tai

It

result.

cannot

You

fOLK inf"£

buy

stocks,

f

p d]

v

.

f?,

because

the

of

(4)

is

of

are

broad

much

real

I

con-

theless have

a

he

accomplished

What

for

his

clients?

(f) Is he well balanced, or does
psychological predisposiIs
he constantly an op-

he have
tions?

attention

because

security

thev

are

attention because tiiey axe
frequently mistaken for profesj;

and

quality

offered by this group.
from

wholesale

small

to

of service

They range

underwriting

over-the-counter

judgment is

interest

of
and

between

client.

his

huf

This

e

is

a

h™dbng
Thcrp

nthcr

Should

neo

bp

no

pies money^ There should be no
can*bet of mteiest betvveen the

^luty>,

^

^

faithfuUv oerforrn

an

^

experience

pension

in'their

fund

investing.

Some 0f tbe larger firms have excellcnt ™ch staff but

hiTft],,Hnrv

n

Z

if

They
special
virtUre of long
But that field is not

Are they competent?

UniOll

im

mnsf

su,:)tle mfrngible but most im

?^1Sp5na{Je

(a)

impartial shouldl>e experts
the absence of any fjnancial field by
or

^

recommendations are usually
geared to attracting individual
customers and generating trading

activity since their major source
oi- compensation comes from corn-

hfs missions

adviser has securities

5^ ,,!,• fi!

on trades. Often, the
^search 'group is not well
rounded,

but have

only one

or

^^g^comr^on8'tw0 lea4ngmeti specializing in to
a
" V 6
7 SZd
narrow field' Here you have
other, he might be in lue c d

"bull."

security

traders and odd-lot-dealers,

An important factor in the ren-

broad, comparative

What is his record?

ciai

houses

ment.

c,ihflo

viewpoint?

category

second category,

character

Absence of conflicts of inter¬
ests — Impartiality
of
judg¬

adviser

qualifying

^
u_ur

u* "yf cui
ci0nal investment advisers
There
inflow of funds there is sionax investment_aaviseis. xmue
pnnctnnt attontion
1S a Wlde variation in the type,

coniicts

needed,

old ia the ciiicuyai:
is uxc analyst?
UJU

Security Dealers and Brokers,
,

dealers and brokers, deserves spe-

.

d

,

box, and then blithely forget about

specialists dering of unbiased

men

of the pension fund,

1S. necessary

experience has he had?
(d) Though a specialist in a
particular field, does he never-

timistic

at

guidance JJfYs

The

uppermost.

Continuity of portfolio

^

college

a
_

education. Not only are

has

the

specializing

citic investment recommendations.

in these days of

necessary

specialization

analysis.

o

consider with whom you are deal-

•

J^^gh thelLTtcr would be more 'n/'^e
SeTS'SdSrec- -'^pe^atSf ^^a^ ^ the^rese^c^ ZnT1a'X
(g)

the capacity

Does he have

ommendations

therefor?
current

Do
ones,

several

his

and

not

just
look at
ago

years

reasons

his
what he
read

and

see

£H„TPTt,nnlH takf

a

stronc

mnin ^Hvi^pi not
trnde
minded^adviser not to trade more
to

\

m,y

more

nprrpntLp

of

orof

Blokers are speciaUsts
comT
mon stock hunting'
In general
they are psychologically biased on
tke bullish buy side to attract

LTeriur -in the iisht of
-What you are

man's

doing is buying a
brain, his ability to think,
and
to
judge. These

should.
terest

should

Tn^rfef^self-in- rather Brokers give excellent cler¬
than long range mvesting.
(b)

prejudice

a

decision,

amined

One

in

can

in

be
a

thing
the

clients.

embodied

written
we

form

This

must
of

and

ex¬

report.
need

guaid

large number

may

be

a

result

Analysis and Appraisal of Types
Of Investment Guidance
I do
^

ana
now

not desire to praise Caesar

to

evaluate
is

to

but

him

bury

evaluate

him

mm.

take

the portfolio
its custodianship. Or¬
they are not set-up to

ical supervision over
if they have

IV

not be "hunches" but well

thought out reasoned conclusions
which

of

Can

reason

cess

of

tailored to

tinuous

as

(e)

attorney
..

need 101 constant attention.

ness

Counselors.

consider

of their general

lvst
iyst tho following tactois are «nr/
the following fnrfnr* orn sug-

index

rise

ticing

Legal

first

us

individual requirements al-

tuese

waYs

against is the mans apparent sue-

a

hurt with

gested
a

Union

Let

patterned

ana-

According to the Federal Reserve Board's index, department
store sales in New York City for the
weekly period ended July 20,
1957, increased 2% above that of the like period of last year. In
the preceding week, July 13, 1957 an increase of 5% was
reported.
For the four weeks ending July
20, 1957, an increase of 4% was
registered. For the period of Jan. 1, 1957 to July 20, 1957, the
recorded

(6) Investment counselors.

(1)

'ot'Z ffnUanc™viser W^ent if Tympany can/both Jo«d to^the.unique requirements

case

there

,

oe reluctant to admit to a client
^is lack of general compeuence in
These funds, as we have noted, this specialized field. A lawyer,
have individual and unique in- by virtue
of being a lawyer,
vestment characteristics, such as Per sf> 1S J10* competent to be an
long-term outlook, lack of need investment
adviser.
The best
for liquidity, and the importance services he could give his client
of compound interest and yield. 1S
him select a competent,
Investment guidance and recom- Qualified,
full-time investment
mendations should be made with guide.
'

to

.

or

.

(5) Pension consultants.

vision and service.

(4

and

banks

departments.^

must cover policy as wen as spe

the guidance

Commerical

(4) Trust companies and trust

fund needs.

POVPr

competent?

to

fans thus far this year.

(3)

C0Vl\try baaks-

or success-

special needs of the pension fund.

the problem of

come to

now

ad¬

according to

a

To be most
for

Investment Guidance.

Union

servinS labor clients. these attorwork performed by *iey? have an outstanding oPPOfanother dentist can turuVY ™ render a real and needed
the patient knows service to their clients in matters
hurts or not, and 0± investments. He has the union s

necessary

Criteria

are:

legal counselors.
(2) Security dealers and brokers.

ability as contrasted
analytical investment com-

the quality of
dentist, only
Basically, moral honesty do that.
All
is only a beginning. Competence, is whether it
expertness,
impartiality,
arm's perhaps it would
length dealing, are also required, dentist.
In short, a high sense of moral
ethics

guidance

(1)

selling

character.

wrote

City

observers.

Hot weather early in
some

other people's money involves
fiduciary standards of the highest

almost

The total dollar volume of retail trade in the

Wednesday of last week

ful

of

passenger cars

Total

ago.

year

equalled that of the prior week.

"elaborate front"

an

Among the chief sources of in¬
vestment

Secondly, like any other prac- with
titioner, a substantial amount of petence.
experience and specialization is
To judge the technical compenecessary
in
order
to
acquire fence of an investment consultant,
maturity and balanced judgment, unions need on their staff techSome people never achieve these, nicians who are able to evaluate
Thirdly, it cannot be emphasized the quality of his work. For extoo strongly that the management ample, the patient cannot judge

say

shoppers increased their buying of Fall apparel

women

objectives,

proximity' friendship* recroximity; liienasnip, ice
pioximiiy, friendship; rec
ommendation by friends; or, hear
ition
hear-

Above Like Period in 1956
As

of

grachv
^iapn>

Trade Volume in Latest Week Was 1%

slackened,

specialized edu-

a

cation devoted to these

futures prices at the beginning of the

such

United

needs

ager one

tA\

support

week,

1956.

adviser job specifications and ap¬
ply them to the various alterna¬

11

page

Investment Management
01 Union Pension Funds

C.

use.

States cocoa arrivals amounted to 2,341,455 bags compared with
2,727,282 bags in the comparable 1956 week.
Hog prices rose to another two year high on Friday, as buy¬
ing continued to expand with hog receipts in Chicago slightly
less than in the prior week- and below expectations.
Limited
wholesale supplies of steers resulted in moderate price increases.
Lamb prices were sustained at week earlier levels.
Despite the
rise in prices on hogs and vegetable oils, lard
prices were un¬

changed, and purchases lagged.
The possibility
of new price

from

35

tives.

their orders for'rice again the past week
somewhat.
Export buying continued to

up

rise and wholesale stocks were reduced. Sugar
prices fell slightly,
following a decrease in trade.
In coffee markets, trading was
sluggish, holding prices close to those of the prior week.
Although cocoa prices advanced at the beginning of the week,
they closed on Friday at the same levels as a week earlier. There
was a slight rise to 316,449 bags in New York warehouse stocks
during the week; a year ago they totaled 421,423 bags. United

in

Continued

.

,

Wholesale Commodity Price Index Continued Its Upward
Climb of the Preceding Week
There

(507)

to

our

uui

the

dinarily

give continuous qualitative super¬
vision over the policies and parholdings
of a large

ticular

analyze portfolio. Some firms, like Merrill
problem

piuuiciu

investment

Lynch,
^

Pierce, Fenner & Beane
»
ir

Continued on page Jo

The Commercial and Financial Chronicle

(508)

£6

unless

business

o£

35

Continued from page

they

able

are

"deliver the goods."

to

R. Badger & H. Guthmann, Investments, Prentice-Hall, 4th ed.
1951.

(b) Is the guidance tailored for

clients

their

desire

the

and

to

special departments just to
render a complete service some
service pension accounts.
(c)
Does the broker's advice pension consultants have extended
their activity to include the ren¬
suffer from conflicts of interest?
There may
be several conflicts. dering of investment advice. This
be somewhat of a supple¬
Pressure may be exerted to help may
bail out the underwriting depart¬ mentary adjunct to their general
pension work.
The investment
ment which has a sticky issue on
its
hands.
Compensation is ac¬ advisory service should be evalu¬
ated
on
the same standards
as
cording to trading activity and not
that of investment counselors who
on
quantity or quality of invest¬
ment advice.
It is always better are discussed in the next section.
up

for a service directly and
by-product. The compen¬
sation is more equitably adjusted
to

as

a

these pension con¬
have the well-

In summary,

pay

not

seldom

sultants

rounded and complete

staff neces¬

It

matters.

Commercial Banks and Trust

they

Companies.

are

mendations

These organizations are

usually

individual

to

as

com¬

commitments and con¬

stock

mon

whether

doubtful

is

set up to provide recom¬

is

worth

investments

what

You get what

you

for.

pay

est.

it

The

can't

you

You

most

these

is

difficult

that

of

to

apply

measuring

of
the

competence of the adviser. Among
factors to be considered are:

ice

do

of investment counsel
service is to give continuous indi-

for nothing. Poor, free advice is educational training; financial exdangerous. Compensation should penence; clients served; and, par-

objectives

„

extent to which
to

clients.

of their

needs

not

be

vidualized attention to the investment

direct

about

something

gett

of

value

a
straightforward
come
should
not

and
l.
It

payment.

The

theory, of course, is a

ocularly, the record which he has
achieved

as

well

as

his

general

—

by-product from
question missions or deposits.

practice conforms

as a

com-

imputation,
W To &et thoroughly

sound

firm

It costs money to maintain an
adequate research organization. It

and competent advice one must be
PrePared to pay for it. Adequate

(d) Are investment counsel free

«<*** «*>« to Provide good com-

fhf^aDe^M^thelone lun. it
ranlt
me cneapesi in tne long

of

varies

which

fact

from

to firm.

nnnflirts

frm-n

nanly

te est.

Fees

yes.

straightforward

ni°n stock counsel than it does to
^minister
a
high
,Trade
bond

inDrHi-

nf

7? contacts or

Ordi

based

are

service

basis

uammibier

a

on

Portfolio.

It

*wi
v
'
Vi
4
always possible, of course, that

out

i

is

conflicting interests might be

investment

of

sources

mentioned

in

tions

the

are

services

the

guidance

preceding

mail

which

i iiton

toiaac

It takes work

under-valued

uuaer vaiuea

ooj a
to dig

common

common

sec-

stock

siock
Often

gtaff

must

be

gent

fieJd

Qn

tdps

cialized, technical consultants like
engineers,
physicists,
chemists,
may have to be retained to keep

subscription
available

are

a

ac-

and the quality of service is su¬ sary for the adequate management quned like that of a diiectorship.
perior. You always get better serv¬ of a large portfolio. A small in¬
(7) Mai. Subscription Services.
ice when dealing with people who vestment staff may be quite com¬
are making a profit on you.
petent to render advice on policy
Distinct and separate from the

(3)

advice

In

too much for good guidance.

pay

(c) Is investment counsel servcontinuous?
One of the chief

of the needs of

Partly because

& Co. have set

and Smith, Barney

vidua! client requirements.

Good

costs.

serv¬

ice.

(D) Absence of conflicts of inter¬

Costs of Investment Guidance

the

by

(B) Personalized attention.

(C) Continuity of advice and

very

attention given to incli-

personal

Thursday, August 1, 1957

(A) Competense.

VI

counsel

characterized

is

service

The

investment

of

essence

Of Union Pension Fnnds

needs?

funds

pension

Investment Management

...

ahead

for

or

merely abreast of rapid-

iy changing technology.

But it is

is

is

better to make payment directly
cryprifipillv

and

nn+

nc

hv

a

and specifically and not as a by-

product of. something else,

ahsnlutslv

npf.p«arv

that'the obje^s $the

fundbe

carefully and thoroughly thought-

should be carefully tailored
meet these objectives,

to

(6) It is important in the selec¬
tion

of

adviser

an

that
..

he

be

.

.

thoroughly familiar witn fund objec^ves and specializing in that
sector

in their special tinuing supervision over the port¬ a few dollars.
The most note- only by these methods that growt.i
personal loans, short-term folio. A custodianship would, of worthy of these are Moody's In- situations can be obtained,
of investment finance.
commercial paper, course, have to be set up either vestment Service and Standard &
Annual
bank
administration
self-liquidating bills, and govern¬ with a broker or a trust company. Poor's Investment
With Collin, Norton
Advisory Serv- fees may run from l/20th to l/40th
ments. This type of work does not
ice. The major job of these com- of one percent of the sums ad(Special to The Financial. Chronicle)
enable
them
to
give competent (6) Investment Counselors.
panies
is
publishing
material ministered. These fees seem enTOLEDO, Ohio—John L. Sulliadvice on a general long term,
individual
companies, tirely inadequate even when aug- van has 4become affiliated with
Investment counselors are indi¬ about
diversified
portfolio which con¬
viduals, partnerships, or corpora¬ Moody's does this with bound mentcd by such factors as earnings Collin, Norton & Co., 5(J0 Madison
tains
a
substantial
amount
of
which are kept up-to- on uninvested cash on commercial
tions which specialize in render¬ volumes
Avenue, members' of • the New
common
stocks of companies
current supplements, deposit.
ing technical economic, financial date with
The
compensation
is York
and
Midwest
Slock
Exwhich are not depositors in that
and investment advice. The coun¬ Standard & Poor's, on the other made too competitive. These fees changes.
•
- :•*
" :
bank.
The mere fact that union
sel fees usually begin at one-half hand,
maintains
an
up-to-date need to be increased to insure the
■
•
pension funds are on deposit does
of one percent of the first hundred loose leaf binder system. Moody's, rendering
of the best possible With Campbell & Robbing
not
insure
nor
entitle
you
to
thousand dollars, with a clown- for example
publishes five vol- service. In general, bank salaries
- (SpdcIill w
->m^t
"'free"
comprehensive
portfolio
umes under the
general headings are too low to hold a good inausward graduated scale.
danrrfamrt'n
t
advice.
of Transportation; Utilities; Indus- trial common stock man.
^7\
.8*"^CSd?i!.R'
Briefly, they are in the business
Investment counselors who de; i
«S
(I) Trust Companies and Trust of p.oviding continuous
advice trials; Banks; and Governments.
competent

very

^

field of

business loans,

,

,

n

Departments of Large Metro¬

In

contrast

banks

to

the

are

the

commercial

huge trust depart¬

Bankers Trust

Company has

$2.4 billion in one pension
fund, that of the Bell Telephone
System. Estimates place toe total
pension funds it administers at
over

that amount.

twice
Let

apply

us

criteria

(a)

qualifying

these institutions.

to

Are

the

competent?

trust

Yes.
have

partments

companies
These trust de¬
excellent, well

rounded research staffs. For years,
these trust departments have had
to

maintain

staffs

investments

in

interested in

as

to

follow

which

they

were

fiduciaries. It

was

There

are

few

a

maintain

They

offices.

central
which

committees

prescribe

and

the

securities which will be bought or
sold. Their statistical departments
all securities which

cover

held

are

in all client -accounts.
The smaller
of

sized

few partners

a

officers and

supporting clerical and secretarial
staff.

Such

firms

of

are

not

narily large
enough
to
having their own research

ordi¬

justify
person¬

nel.

fund

are

organizations which
engaged

is that

they will

professional adviser who speciaiizcs in rendering that type of

portfolio

a

submitted to
time. This type

so

many

accounts

on

a

and

managers

often

are

include the following:-

bond sector.

the

as

——

are

'V

A

'

firm

(c)

Trust

supervision

tinuous

and

under

constant

a

is

con¬

are

securities

kept

check.

(d) Is the trust department
biased?
It certainly tries to
The investment officers
out

highest integrity.
possible that conflicts

be.

selves

of

men

But
may

it

is

arise

that

the

partners them¬
experienced analysts

are

and in addition have the authority
to modify firm

policy to fit the
pension requirements without first
obtaining committee approval.
Most

with¬

are

question conscientious

the

un¬

is

investment

counsel

are

registered with the SEC under the
Investment Advisers Act of 1940.
It should

be

emphasized that this

the Commercial Department
which
solicits
large
depositors

registration

whose

administration of the Act by the
SEC merely attempts to keep con¬

with

the

securities

Trust

may

Department.

be held by
If

securi¬

ties

are

of

deteriorating credit condition

a

which

(5)

to

ones

be

liquidated

because

does

quality of advice

victed
and

to

felons

out

eliminate

not
or

of

guarantee

service.

the

The

business

conflicts

of

advise

union

actuarial

tirement

program

given earnings rate
fund.

clients

aspects
on

the

a

managing

re¬

with great

assuming

a

the pension

The closeness of these

con¬

sultants to their clients gives them
intimate knowledge of the pen¬

an

sion

requirements.




the

affairs

other

peoples

money

the

the

criteria

most

of

competency

the

who

.

Fourth Street, members of
Midwest Stock Exchange. .
.. ..

informed

conference

•

.

roughly 2 %

a year,

LOS ANGELES, Cal.—Seymour

-

of Mv J, Ross & Co., 6505 Wilshire
Boulevard.:-- ^*;
t r *■
~———

.

—

as

would double the price level
every

table,

if

we

35

years.

However,

even

accept the inevitability

of
creeping inflation, and I
certainly do not, it is not pos¬
sible to
have
just a 'little'

Wall Street Journal.

Commercial and Financial

(3)

Journal of Commerce.

(4)

Business Week.

the

(5)

Forbes Magazine.

flation and

(6)

Monthly economic letters by:

inflation.

Chronicle.

First

Federal
National

"Once

Reserve

City;

Chase

Guaranty

Trust;

Bankers Trust Co., et al.

(B)

C.

Canby Balderston

Government Publications:

(1)

Federal Reserve Bulletin.

(2)

Survey of Current Business.

carry

(3)

President's

one

B.

Economic

Report.

Textbooks:

Graham

&

Analysis,

D. Dodd, Security
McGraw-Hill.
3rd

ed. 1951.
B.

tor,
1954.
'*(}•' '

2nd

ed.

Harper

&

Bros.

begins to make its
light
of
that prospect,
the infant
ceases
to creep. It learns to
walk, run, and finally gallop
even
though the gallop may

it

over

the brink of the precipice that every¬

must be avoided. . .
— C. Canby
Balderston, Vice-Chairman of the Board of Gov¬
agrees

ernors

We

Graham, The Intelligent Inves¬

community accepts
of continued in¬

a

prospect

business decisions in the

Bank:

from

of the Federal Reserve
can

such

only hope
an

exalted

fall from many eyes.

-

Feerst has been added to the staff

(2)

Y.

„

(Spcciailto Tirc PiNANciAi^oimoNuax)

(1)

N.

the
w

.With M^ J. KOSS Co.

thing. A little inflation, sometimes thought of

(A) General Financial Publica¬

the

important thing to consider
record of accomplishment.
Competition will force them out
is

ST. LOUIS, Mo.—Alvin D. Segal
is now connected with .Schcrck,
Richter?
Company,
320-- North

misconception that is part of our intellectual
today is that a little inflation is a good

following reading is suggested:

(C)

Are counselors competent?
indicated above in discussing

an

,

currency

tions:

particularity.

(a)
As

executive

in

Manhattan;

on

of

labor

at

manner

Typically, investment counselors

a

their

or

financial

in¬

render only advice.
They do not
particularly specialized provide custodial service. They are
group whose major activity is to essentially specialists, devoted to
cost

the

wants to be able to discuss current

terest,:.

will be sold first?

Pension Consultants.

This is

For

D.

Dangexovs Misconception

"A

Sources of Information About In¬

*

.

(special to the financial chronicle)

:

retainer

that

personal attention.

c

Midwest

the

With DCfierck, Kicnter

a

they basis. The advantage to a small
really do not get close individual pension fund of a medium sized vestments and Business Conditions
be

members of
btock Exchange,

nue,

member

by them in the handling
the common stock portfolio as

.staff

sometimes

independent consultant or staff
to help him decide the
kind of service he needs; to select
an

utilized

well

research

rec-

their

however, is not rcc- service; and, to evaluate the speommended for pension funds as it cialist's recommendations.
is not particularly tailored to long
(2) Investment management is
run
individual requirements.
In a full-time, professional job, reother words, it lacks the quality
quiring
the
highest degree
of
of. b.cing
personally tailored to technical competence and adhertheir requirements, nor is it con- cnce to
fiduciary standards.
tinually supervised.
(3) Factors or criteria to be
Such services, do, however, con- considered in the selection of a
tain many helpful suggestions for
professional ^investment adviser

of

of pension
There may

(1) A union fund manager needs

service,

clients?

aware

some

The second aspect

them from time to
of

___

for

reasons

service

their

review

the requirements
well

the

0

ommendations.

fund

investment problems.

,

,

consist-

firms

or

fields, setting forth in

more

detail

firms

large

branch

through

operate

management
define policy

com¬

The partners to this work
of their pension personally. They also evaluate the
material l obtained
from
outside
Certainly the trust

their advice tailored to

Is

„

evaluating the prospects of
panies and their securities.

the

only a short step to applying this
information to specialized pension
fund administration.

(b)

.

which

the

ltond

ment fund

ments of metropolitan banks which
handle billions of pension funds.
The

'

In addition, both of these agen- vote more time to stock analysts i3uiicjjnoC
supervision on the manage¬
'
1
an c
according to the needs cics supplement or augment their have a higner scale of fee taan
of the particular client.
Profes¬ corporate reporting with special- that of the typical bank or trust
W^ith Barret Fitch '
sional investment counselors are ized
counselling
service.
This
(Special to The Financial Chronicle)
men who have the security mar¬
counselling
service,
in
general,
Summary
KANSAS CITY, Mo. —Herbert
kets,
industries,
and
economic base two aspects. For a fee they
In closing, I would like to stress F. Ziegler is with Barret, Fitch,
trends under constant study and will send you regular recommen¬
North & Co., 1000 Baltimore Aveuse
them
as
a
background for dations to buy or sell in one or these thoughts:

and

Institutions.

politan

™

that

System.

such Excellent

source

will

cause

advice

scales to

>

Volume 186

Number 5660

VT The Commercial and Financial Chronicle

(509)' 37

Continued

„

•

•

r.„

,

.

.

.

,

States would eventually spend it¬
self into bankruptcy.
How many

,

uThe Fundamental Issue"

tively and to have what

of

frgm;jip^t,.pq&e

the

leaders

our

of Thomas Jefferson's

he warned

with

future of this
of

magnitude and diversity not
yet fully comprehended. Ma¬

a

as

chines
will

mechanical

and

and

more

machines

in

devices

operate other

more

endless

an

growing

cycle, defined as Automation, of
labor-saving and multiple produc¬
tion systems.

items you buy.

For example,
in this indirect way;

pay

you

Twenty per cent of the cost of
food;
Eight
hundred
dollars
on
a
$3,000 automobile;
the

cost

of

a

of

package

cigarettes;

believe

this will

that

be

an

evil, threatening mass unemploy¬
ment

and

heaval

consequent social
similar to

a

up¬

the

somewhat

disorders

rarily

individual labor tempo¬

sustained

revolution

the industrial

in

the

of

and: 19th

18th

centuries, would be illogical. Such
attitude would

Nearly 9/10ths of the price of

a

bottle of whiskey.
Taxes have grown so rapidly in
recent

that

they are
the largest single item in the cost
of living. Americans will pay for
years

this

government
meaical

provements which always accom¬

now

year

tney will spend

manifestly dis¬
count
completely
the
relative
slowness of the development and
the corollary and beneficent im¬

than

more

food, clothing,
religious activi¬

on

what happens:

an

will

There

progress."

pany

to

cause

Before you

morning,

Actually, the, produc¬
tivity of the economy can be ex¬
pected to grow at the rate of 3 to
4% a year- while * the. number of
new
workers,- due; -to .growth of
population, v will." be'. only about

'>/.*•

:

Nuclear

energy

and: electronic

,

cannot fail

advances

bring an

to

of relative plenty.
For the
age
firstvtdmeahepevwill be provided
the tools whicli promise to man¬

kind the?satisfaction of his basic
economic and material
needs.
Some of you may

well live to see

day when we will be di awing

the

energy not only from the sun
from the tides and the winds:

but
will

creating unheard of synthetic
materials; will be purifying sea
be

water; will be mining ocean floors
for basic minerals; will be cele¬
brating
and

life

a

of a hundred
will be launching

span

more years;

will

meal,
this is

a

night,

or

collects from the fertilizer compa¬
nies and farm equipment manu¬

facturers who supplied the farmer.
He collects rail and truck trans¬

portation

taxes,
manufacturers'
taxes,
telephone
taxes,
property taxes, sales taxes, income
txcise

taxes, social security taxes,

gaso¬

line taxes, license fees, inspection

lees,
so

permit

knows

what

the

on

taxes
as

they

tiny taxes

pear

all

on

of beans.

drained

off

vested

in

prises

or

of these

you

do

not

ap¬

There

are

151

of

bread, at least
maybe more on a

and

many

can

When

which

bill.

loaf

a

even

pay at least

you

pound of beefsteak,
a

box of soap,

a

Billions

which

new

year are

should

in¬

be

enlarged enter¬

or

spent

a

the

on

products

enterprises. I do not hesi¬

tate to predict tnat if government
continues to wrest from the peo¬

poverty for the first time
possible extinction.

see

ple the basis for future industries

the

reach

to

with

faced

and
businesses, our rapidly in¬
Living standards will be the high¬ creasing population may eventu¬
est, scientific advances w-*U- h** the ally outgrow the number of jobs
most revolutionary, world affairs available
and industrial labor will
will be the most exciting in all then face its
greatest threat.
history.

There

Taxes

Lower

'If

businessmen

lowed
be

wish, I

a

am

unanimously

sive
of

venture

the

of

taxes.

lower
is

now

almost

be

to

as

it would

sure

for

The tax burden

in

capital.

al¬

be

to

were

so

oppres¬

confiscatory

Secretary

As

Humphrey

Treasury

re¬

Congres¬

cently testified before

a

sional Committee,

the present

heavy

.

seriously
economic

will

burden

tax

hamper

.

necessary

growth/' adding that, ". . . spend¬
under
existing
government
programs will risie as fast as the
ing

increase

.,

in

resulting

revenues

economic

from

unless

growth

the Administration
alter and reduce those programs."
and

Congress

-Taxes

for

1956

to

came

a

stag¬

lust

of

1914 which

the

to

cess

the

with

which

been

tossed

the

ernment

cost

sum

limits
we

housed;

product

The govern¬

taxes 'has

and inordinately.
In 1835 the per capita tax take
was
$1.98.
In 1917 it was $7.92.
During
$35.70.
off

to

World War I it rose to
In 1932 there was a drop¬
$12.48. The high point of

World War II

$312.86.
of

1956,

was

hit

in

1945, at

Last year, the fiscal year
was

the

costliest

of

all,

$446.86 per head for every one of
Such jet-propelled figures are

us.

difficult to

comprehend.

hidden" from
form of
check

unseen

Much is

view

in

nibbles at the pay

You

never

know you

paying because they appear

part

as

of the purchase price of the




we

unlimited

to

clothed

provide

the

how
and

for

old

national

divided

us;

how

sell; how

long

among

buy and

is

only

dares

we

shall work.

for

scorn

to

the

"The

say,

There

who

one

government

should not be infinite."

Actually,
now

the

fortunately, it
and

our

been

becoming

Our

estimated

billion,

is

more

far

beyond

indebtedness

to

is

be

nearly $700
greater than the

sum

a

Un¬

For years we

spending

means.

now

combined debt of all the other

na¬

tions

has

of

been

the

world.

charged

that

proposes

And

without

government

our

to spend

as

it

Russian

implacable

enterprise
early

as

pur

forbids

it in

the

our

disposi¬

We

money.

life

must

to

pro¬

shut off the

on

work

at

the

other

rev¬

and

end

Keynes, generally regarded
modern

apostle

is

said

to

write

who

sons

happen to be manning
those projects at the
moment, or
even
to change political
person¬
nel, would be about as effective

in

stopping socialism

undertakers

be

to

Excessive taxation produces re¬
somewhat

resembling the
of
slavery and serfdom in
clays of old. To illustrate; the gov¬
evils

ernment

takes

in

danger

in

book

spending, recently wrote:

taxes

Quotes Truman

over

a

"I do not wish to minimize
serious consequences of the

she is required to work

or

en¬

dictator,
Lenin,
foe of the free

system, predicted
as
1920
that the United

the

type

of

inflation

encing.

we

It

hardships

are

has

to

now

experi¬

already
large

a

our

population,
as

in

brought

the

on

of

segment

the

cities

omy

govern¬

ex-

Truman, a main pro¬
tagonist of high taxation and free

sions and fixed incomes."

the

the

Even

he

reduce

practice of rigid econ¬
to avoid burdening tne people

must

* there is

.

inflation."

third of the income of the average
citizen each year. This means that

to

as

farm, and especially

to those who have to live

and

men!

on

pen¬

What

a

change is there,

arming the Magistrate with tirely for the government from
patronage of money which might Jan. 1 until May 10. This begins

be

used

to

corrupt

of government.
of

.

.

public

the

principle

The multipli¬

.

offices,

increase

of expense beyond
income, growth
of the public
debt, are indications

to

resemble the Soviet forced la¬
It practically reduces

the

rather

to

citizen for

protracted periods

what amounts almost to invol¬

untary servitude.

It is indeed the

generation

every

debt

own

to

its

pay

it goes."

as

of

the abandoned slavery and serf¬
dom of the
preceding centuries.

We

How

incomparably different in
philosophy from Karl Marx, that
patron saint ol' communism, who
50 years later, while
planning the
destruction

of

all

constitutional

government, said:

will

not

fortunate

be

if

it

does

finally reduce individuals
universal status of robots.

the

The
even

present

tax

structure

to

now

probably adequate
eventually to socialize the United
States.

Marx's Prediction
"The surest way to overturn the
social order is to debauch the cur¬

Our tax-take
is
already
greater than that of the admitted
national socialistic
countries,

whether
of

rency."

the

this

on

Iron

the other side

or

Curtain.

..

The

effects,

of course, to the may not yet be fully evident to
the superficial eye, but the ero¬
inflation, induced by
extreme taxation; the process of sion of incentive, ingenuity and
"planned economy": the process integrity toat remits will be as
of controlling economic conditions deadly as the hidden cancer is to
life.
It can in time change the
and thereby
controlling the lives
He

referred,
of

process

of individuals—a control of

fiscal,

basic character

of this

great

of

na¬

a

his

But

in

paid

a

at the

come

Presidential

than

math of

the

ze¬

power

dismal

after¬

newspaper column.

inflation is not

question of

a

partisan

politics.
It can be
trolled only if both political
ties really wish to

con¬

par¬

stop it; only if

both

parties

limit
our

as

so

financial

increased in
be

determined

are

spending

to

to be within

means.

If

is

Oh my country¬
difference it would

have made had it
nith

...

on

What

bor system.

soliciting the employment of the modern although humanized
pruning knife.
It is incumbent counterpart in the 20th century

output

one

has

to

be

segment it must

correspondingly

decreased in
another. If defense spending has
to go up, other
spending, whether
for housing, roads,
schools, farm
aid, or social benefits, must be
curtailed accordingly. This is only
common sense.
But, even though
tax receipts have doubled during
the
postwar
era,
total public
spending continues to exceed rev¬

Promises

enues.

continue

to

be

made to expand all sectors of the
economy at the same time.
Some
are 42%
larger than they were in

1953-54. Literally dozens of wel¬
every other nation
where it has become indelibly af¬ fare projects little understood by
higher
i
the general public are hidden in
fixed. < /
prices and a gradual devitalizing
the more than 1,000 pages of the
of the purchasing power of money.
Blames Taxes for Inflation
budget which has .grown so big
The continuing rise in the cost ot'
that nobody has any clear idea
In the last two decades our tax
living is due to our drift deeper
how much waste it actually con¬
and
deeper into inflation until system has resulted in a creeping
tains. Some almost incredible and
today our whole economic, social inflation which has devitalized the

monetary

forces

and

general

which

economic

tion

it

as

has

produces

and political system is infected

American

arf

previous .purchasing power. If the
present trend continues, the dol¬
lar may well sink to half its pres¬

by
mentality which
point where the very

inflationary

approaches

a

foundations

of

threatened.

"Taxation,"

structure

our

are

with

its

offspring, inflation, said Lenin in

nation

founded—the

was

which has made

system

the most pros¬

us

value

ent

small

world's

and population—the

area

which

system

the world's eoods

one-seventh of the

gave

people

our

liberty,

privileges and op¬
portunities than anv other nation

But

man.

rency;

the

of

kind

a

nation

to

Socialism."

to

he

And

the

meant

by

So¬

forcing

of

economic

controlled

centrally

the working

a

a

does

even

nation's

cur¬

a

illusion

preciating

fantastic

ex¬

it

opinion with reference to it.
is

it is

that

which
its

can

learned

hands

This

is

all

the

but

complete

The

nonsense.

guesswork

ministrative

warned

early as 1819 that ".
power
to tax involves the

the

power

have

as

.

to destroy."

added

struction
Its

Marshall

John

Justice

that

is the

evidences

talk

about

tors

and

so

.

And he might

the

road

to

de¬

road of Socialism.

which

we

much—the

dispensers

of

see

and

collec¬

socialisti¬

build,

the

maintain

votes

control

they
—

all

coerce to
these ex¬

pressions cl socialism are but the
offspring of excessive taxation. If
we
want economic liberty—want
to be free to work most produc¬

whose

experience

forces

Western
same

1,700

which

World

of

forces which

dur¬

years ago

need.

Each one, engrossed with
super-importance of his own

the

and

power,

that

he

estimates

deems

he

a

can

utilize,

irrespective of extrava¬
sum
of these, with
some
modification, becomes the
budget unless someone at the top
The

gance.

lowers the estimates to correspond

a

Chief

and

small

a

assignment,

It is

Tax

the

budget is

of

previous training and

nopoly that is politically managed.
to

bosh

national

be¬

of

of individuals, temporarily
gathered in Washington by ad¬

with the actual

Power

such

group

ing the decline of the Roman Em¬
pire. Just as in Rome, our civili¬
zation is living beyond its means.

upon

in

be quite

comprehension
ordinary citizen.

all persons in the na¬
tion, under an authoritarian mo¬

life

rooted
to

specific knowledge of the nation's

inflationary
the

as

the

yond

maximum

are

as

four, that it is
perfect equation
not be disputed, that
a

preparation is

function

at work

true

as

two and two make

arithmetically

lower and lower.

today

One

perfect example of

a

scientific fact, that it is

The tendency
prices to go higher and
higher, the value of money to go

were

pro¬

public

irredeemably de¬

an

currency.

the

been

upon

has little to do with acquiring any

for

The

foistjed

in

once

is

falsities have

gressively

nation's

false

speculation that

recover

undermine

cialism

on

pects something for nothing. His¬
tory shows how difficult it is for

...

road

living

prosperity; it discourages thrift
honest effort; it encourages

mended

the

decade.

and

is

as

those

It creates

recently ex¬
claimed in reviewing our situa¬
tion, "The spirit of Karl Marx no
doubt rejoices.
He lecomactions

its

of

wages, annuities or

it also debauches

Herbert

such

another

than debauch

more

the sway of

some

40%

inflation

ever gave its
people in the long
history of the world. No wonder

Hoover

to

pensions—especially

of

half of

—

incomes,

duce

over

within

means

fixed

morals.

with less than

dollar

Those who suffer most from such
fiscal debasement are the men of

people of all history—the
system which enabled us to pro¬
perous

ies, the services they presume to
render
and
the
pyramids they

as

he

warn

ment to the

endeavor

all

much

to

that,

fi¬

on

remarked

President

stop

death.

sults

another

be-:

changing

as

would

have

just before he died that
British people

damn the per¬

the

as

inflation,

of his famous treatise

cause

nance,

ects of socialism

or

of

well

c-ally used funds, the planning
committees and enforcement bod¬

Executing Lenin's Prediction
that

roots

we

must focus

concern

which nourishes the disease.

enue

To

same

forbid

public

or

challenge
this year

other governments put together.

The

in

money,
tion of

budget

economy.

abnormal.

more

have

national

the

governs

which

would

a

the

after payment of the direct

income-tax.
are

direct

not,

cumstances

steadily

grown

be

liberty,

private
paying

more

income,
the product of our labor,

shall

we

or

by dictating

and

how

how

age;

it

sarcasm.

almost

fed

are

wastebasket

and

government which

a

lives

our

is

has

and how hard and under what cir¬

by the entire population

for

for

wise

least,"

the

want

government;

explosive

gov¬

of all goods and

appetite

only

one-

almost

of the United States.

ment's

billion.
of

national

the

which is the
services

$30

the

consumes

of

third

other

that

to

government

into

we

now

of

governs

ridicule

shall

means

time

Jefferson's

"That

best

choice

our

profusion with servitude. The
prudence

our

perpetual

support of the basic thesis of Karl

kind

a

Thomas

aphorism,

pay

make

Marx, "is the vital weapon to dis¬
place the system of free enter¬
prise"—the system on which our

but for social purposes. Since then
the sphere of government has in¬

Whether

must not let
with

must

ac¬

revenue

with

load

We

and

for

creased

we
us

debt.

our

wealth,

not

force.

independence,
leaders

dangers

preserve

unlimited

gave

people's

taxes

levy

which is

ernments

began

first

and

This

It

the

billion

gov¬

taxes.

for

of more • than 3100
billion. The Treasury received $70
local

restraint

no

power

total

and

for

be

with the Federal Income Tax Law

gering

state

to

seems

this

To

tax

merely bemoan the detailed proj¬

-

the greatest of

as

feared.

these—and

are.

dozen egga,

ouy a

100

fees;

others that nobody

many

be

cation

Details Tax Extent

moon;

shins

snace

sit down to

noon

be

ployment.

the

duce—our

a

The tax agent collects from the
large volume of unem-N farmer who grew your food. He

a

1.5%.'

and

care

ties combined.

changes in jobs requiring adapta¬
tion of I he labor force but nothing

country:

wnen

to

place economy among the
important virtues and pub¬

lic debt
to

voice

reference

between economy with

*

To

"I

most

your

Half

still heat the echo

to

expected

resources

available.

be

The problem of
budget, instead of be¬
mystic
and
untouchable

balanced

living more and more for the
moment, trying to anticipate to¬
day the pleasures of tomorrow.

ing

Why

monest and most universal

a

phenomenon, is actually the

asks the citizen, if sav¬
ings are likely to be expropriated
through taxes and inflation? Why

every

household

wait

can

It

simply,

TV

com¬

spent

save,

for

afford

set,

if

a

the

day

house,

we

can

when

we

or a

car,

buy

these

or

a

things

the

world.

is

The

It

faces

the

one

head

every year

how

much

in
of

of life.

can

be

safely on living expenses.
question is not what can be

today on credit? it is no longer luxuriously used, not even what
enough that our economy grows may be actually necessary, but
annually faster than the increase what can be obtained with the
in population; the call is for twice
money
available
without
inju¬
this
growth.
Wages
must
rise dicious borrowing. If one's natural
faster
than
productivitv; the desires were followed they would
standard of living faster than in¬
always amount to much more than
come.
This is the folly known as could be
actually afforded.
But
inflation; yet many prominent the householder is forced to exer¬
economists
ers

still

of

tion."

ami

innumerable oth¬

the desirability
toey e«Jl. "Limited infla¬
Few
k n o w
that
Lord
preach

cise

prudent

tice

thrift

or

restraint and prac¬
eventually he wi»t

Continued

on

page

38

The Commercial

38

Financial

and

therefore it will not permit power

//

The People

He must be

itself

Pay

stxj

people free much of what they get
I am convinced

"yes."
,r„ft,rnr

*

Refers to Hoover

the

exactly

is

It

basic

same

is not

.^ea wj1Q payS

much. The painful truth

with

it

does

later

becomes lavish.

"There

flashy and temporary
authority. Far other¬

1, 1957

August

of

to come.

ages

"This

the

is

of

nature

consti¬

How wrong jn income taxes comes from the
testified to by the iowest rate—the 20% paid by all
surpluses that have accumulated persons with taxable income. Only
over the years.
These surpluses,
is added ^y ad the higher
the over-estimates in the national rates up to 91%.
budgets of actual needs, glut our
•
warehouses from coast to coast.
Indeed, it has been suggested
Thev are not limited to agricul- that
one reason for the steep
tural products but exist in prac- graduation of the income tax is
ticallv every field and every com- to
make the public think that
controlling influences.

is

be

people with high incomes pay

modi(y

ja.'

a

rnm-

tinm,pr

A ifiemb

matter

1 hp

.

.

govern¬

liberty

destroy

.

The

.

percentage of

a

which

income

will

not

free economy at home

our

further

and

at

...

total

our

.

thing is to keep our ex¬

penditures

one

it is

.

essential

inflate

and

debt

our

currency."

our

How

voice

words

that instead of

wish

I

feeble

could

I

my

those

sound

though they were writ¬

as

in

ten

blazing rainbow colors on
the very arch of the sky.
'

\

■

'

■■

Securities Salesman's Corner

administration. It is the little everything by its union of mili¬
peopje wh0 pay the largest part tary and civil authority, by the
0£ ^ie kju
Eighty-five per cent influence of patronage, and office,
0£ ajj
E>iiiions 0f dollars paid and favor; this indeed was diffi¬

ments

can

been

issue

liberty today is internal, from the

government produces

big

of

of

the disease of power, all
their potent part. At best
the result is but a guess, a speculative estimate with little or no

currents, the blandish-

play

of

>>7

.

against the
creeping socialization in every do¬
mestic
field.
Liberty
was
the
foundation of our government, the
reason
for our growth, the basis
of our happiness and the hope of
our future.
The greatest threat to

it

of powerful lobbies, the
allurements of expanding hon-

Instead of being
radical,
Temptation assails one from evreiy
angle.
Ambition becomes very
human, indeed.
The pressure of
reckless.

zons,

has

and

seeks for duration and
permanence. It looks before and
after; and, building on the experi¬
ence
of ages which are past, it
labors diligently for the
benefit

issue

growth

ment through the constantly in¬
creasing power and spending of

jce to pe0pie> it must

conservative, one becomes

political

is

the

wise,

constant

contain-, the Federal Government

manifesto

a

great fundamental

the government gives a serv- stitution of this department, which
at the sam*» was infinitely the most difficult
time take away from the people part in the great work of creating
j^g^t to provide and decide our present government. To give
£0r themselves. And the amount to the executive department such
which government doles back to power as should make it useful,
peopie or spends to promote and yet not such as should render
wejfare js always only a fraction it dangerous; to make it efficient,
0£ what it takes away, because of independent, and strong, and yet
excessiVe cost of governmental to prevent it from sweeping away

comes

issued

resistance to

ever

careful, one be-

the nomination

for

ing the following statement:

satisfy

tutional liberty;
and this is our
itself.
Whatever it liberty if we will rightly under¬
Spencjs for people it must prevL stand and preserve it. Our secu¬
ousjy take from the people in th* rity is in our
watchfulness of
£onn Qf taxes.
Moreover, when- executive power. It was the con¬

of others collected by
taxation. But what a monumental
difference this makes.
Instead oi
being frugal, one
Instead of being

citizen has no
for big government

average

and

that

but

the

(hat

that trm money
that of his own notJiing

difference

involved

Study

government, with the

problem in
vital

from its services.

chiHv

Neither

it.

rival

of the United
States, General Eisenhower. They

overstep its

with

able to
say
"no" to excess iivjjis when
no" 10
items wnwx
Another of the great illusions
everything in him wants to say is that the government gives the
x-

for the Presidency

to

"The Fundamental Issue
'face disaster.

vention

prescribed limits,
though benevolence, good intent,
and patriotic purpose come along

37

Continued from page

it

Chronicle... Thursday,

^(510)

which studied the matt

most of the taxes. It is another
Elusion to think that excessive

Don't Overlook the Conservative Investor
I

do

power

not

wish

He

have had

with

I will not

extent

clients)

before
an

to

an

since

known

never

have had

we

The

business.

investment

-

but they could as well have
spoken but yesterday.

in¬

conditions,
and
the
high tax rates on income have, of
course, added to the seeking and

searching for common stocks that
could grow in value. In many in¬
the

stances

results

there

shallow

when

water

and

is

a

it

splash and

a

rest

You

wave.

is

ex¬

You take it easy.
step or two in

water, then

small

a

while

a

play in the sand, then
you w, go
a little
deeper but you
never
command
you
make a
you

—

This is the same emo-:
situation you must work

.of it.

game

tional

when

with

flationary

spoke those words 123 years

ago;
been

First

as

we

the

pect it to swim.

general market securi¬

in the conversations

the Constitution.

jealous; I will not trust
executive power, vested
in the
hands of a single magistrate, to
keep the vigils of liberty."

and

brokers

as

into

screaming with fright if you

se¬

overemphasizing
an incentive to
investors. For the past few years
the words
"growth stocks" and
"buy
for
capital
appreciation"
have been paraded before the in¬
vesting public in advertising (and

be

to

me

in

investment

child

if

wonder

to

the

ties,
are
not
"capital gains"

blindly confide,
where all experience admonishes
...

in

us

business

dealers

the
it stands

as

of

curities

impair

of the President

written down in
But

to

beginning

am

those

cult.
"I

JOIIN DUTTON

By

it

to encourag¬

comes

ing the purchase of common stock
by
individuals
who
heretofore
have been adverse to investing in
equities and other types of secur¬
ities.

with

Start
tive

the

securities.

tional

most

There

conserva¬
are

today

advantages

excep¬

in

tax-

been

have

pxempt bonds over taxable sav¬
In others, if ings accounts.
In almost every
estimated to me that in the last
Men Who Lose Faith
you look around and go over the:
decade perh;apsIt
county in the land, bond issues
its
There are many who have lost past recommendations of some of are going to be sold to build more
faith in this early American ideal even the most astute .analysts, you schools,, more water systems, more
of this, he said, could
large
goiu
' . . ,i2
of the nations economic strength. and believe in a form of socialis¬ will find some pretty sad disap¬ sewer systems, and better roads;
This is hut one facet depicting the The very source of new and better tic, totalitarian rule, a sort of big- pointments. Although the record Try some advertising about taxjobs thus disappears. This is eco- brother deity to run our lives for has been good, it hasn't been a exempts' and. bring it down to
nomic
folly based on the false
us.
They no longer believe that one way street by any«.means, .w b earth. Tell the man who has all

mission

income

lav

actual experience
For five years I
made up the budget for the Army
and Air Corps when I was the
Chief of Staff, and for six years
supervised the Japanese budget
when
Supreme Commander for
the Allied Powers in the Far East,
The estimates submitted
to me
were
astronomical compared to
the moneys available without borrowing; but, it may interest you
to know that the largest yearly
budget I put in for the Army and
Air Force, which were then cc^}"
bined, was approximately
$490
million, and the highest for the
entire Japanese
nation ot more
than 80 million people was less
from

Yet, I can say
confidently that the security of
the United States i was
as
relabillion

$2

Proposition that growth can be
through continuous
in^auon.

times.

But, even greater issues are involved than any I have yet men-

tioned. Some years ago, the late

President Woodrow Wilson made
the following statement:

"The history of liberty is the
history of the limitation of governmental power, not the increase
of it."

bors of the

people and ultimately

precipice of financial disaster eminent down with the modest
if the rise in government spending restrictions of a Constitution, limwere not curtailed."
He said the iting the government's powers to
the

faces

a

because

danger

exhausted

has

and

"great potential the performance of carefully
the government specified responsibilities,

its

its

exhausted

to

power

tax

have

in

a

a

national emergency.
,

,,

at

foreign
gobble

home

or

power
us up

if

some

some

that
we

„•

going to
.v.

ly behind it by furnishing the

exorbitant funds
in

ru*e anc* regulation. This is the

terrible

u-

demanded.

retrospect, these disasters

never
rpv„r

never

to
to

have
^OTr/i

have

happened,
.

been

..

Yet,
seem

seem
_

quite real.




subject

vejT essence of free politipal in-

did not blindly

miixr

be

cry

monstrous

was

they must

Al-

,

there has been

ways

a

the floor

0f the United States Senate1

continuous stampede authority;

patriotic fervor—with the

of grave

evil

Power

on

misrepresented to the
"All republics, all governments
Our government has kept of law, must impose numerous
perpetual state of fear— limitations and qualifications of

kept us in
of

on

Daniel Webster said

been

public.
us

Daniel Webster

to bor-

power

row," that it has "no reserves."
Our swollen budgets constantly

their

manage

own

There

thesis is to

Their central

Are

his money in

Billiops Still in
places.:, *'...

from you
on the presumption that a handful
of men, centered in government,
largely bureaucratic, not elected,
can
spend the proceeds of your

My point is that there are still
many investors who dare not yet
convinced that they should go all
out for widely fluctuating com¬

toil

mon

your money

labor

and

than

tage

money.

to

away

greater advan¬

create' the

who

you

Nowhere in the history of
race is there justifica¬

stocks.

Take

look: at

a

the

bonds,*
exempts, in savings insti¬

tax

the human

tutions.

tion for this reckless faith in po¬

ance

Look

sales

insur¬

life

the

at

still

to

soaring

stitutions.
a

The spirit of liberty is

sharp-sighted spirit; it is a causagacious,
discriminating,

tious,

far-seeing intelligence; it is jeal0US °* .encroacbmenf> jealous of
Power, jealous of man. It demands
checks, it seeks for guards, it in-

sists

on

securities; it fortifies with

a11 Possible

care against

the as-

and Pfsion-

cloes noto£ human amiable weaktrust the
nesses
nature,

and

disaster.

It embraces

essential

an

idiocy, that individuals ' who, as
private citizens, are not able to
manage
the disposition of their

become in public
who can manage

earnings,

own

office

supermen

the affairs of the world.

more

freedom and less comfort

than

the

jails.

The old

phy

of

inmates

of

American

American philoso¬

government

tions

new

talk
who

have

in

have

done

more

effec¬

of

make

restraint—free¬

mistakes
if you will. The fundamental and
ultimate issue at stake, therefore,
is not merely our money, it is
liberty, itself; the excessive taxa¬
tion of ah overgrown government
versus
personal freedom; a least
dom

to

your

own

denominator

common

rity against the

of

medioc¬

proven progress

of

On Sept. 12,

1952, Senator Rob¬

ert Taft conferred at Morningside

Heights

with

his

successful

con¬

soundest

and

form

that

are

available, in his .own. "home com*

' You

a

can

you

of

can

ma\ce

nihility.

income

start here and
good case for $35

$1,000

per

of

invests

ment TAX FREE which is backed

by

up

own

after

And

V

and

faith

the

taxes of his

and

credit

home town.

and

there

start

you

investor has made the first
step let him buy a few shares of

your

A.

&

T.

he wants

For

it.

have heard investment
say,
"Look at the record.
at
the la®t
10 wears.
If I

men

Look

cou'dn't

letter

done

have

ouit

have

wouH

I

that

than

trying.

The divi¬

at the record.

But look

has been $9 a share year iii

dend
ana

if

T.

I

years

o"t and there have been

year

valuable

The

rights.

p-onle who

Tel^hnne ljv^ it, thpv

own

seem

Thev have con¬
fidence in it an*"* thev know that
to

satisfied.

be

exiri

couldn't

we

the

toAav

without

For thes73 phonic
learning to know
common
stocks,
?nrl
for

telephone.

who

lust

are

about

invest¬

of

income,

rise

the

in

these

of

cost

are

understand

in plain language,

to

"play the market." Al¬
though we know that good com¬
been

stocks have

mon

ment

during

there

are

the

still

invest¬

of

past

25

years,

millions of

laeorde

who associate common stocks with
a

form of rambling, with risk tak¬

count on and for them it

c-on

is good.

Aft°r
now

vou

client®

ouire

get

a

a

good

growth

then
y«u

Do

sell tho-m

—

high

some

(inflation

You

before

you

can

Fund,

stocks

later.

crawl

vou

but

»c-

little

feet wet

c|iips, and even

tyoe

common

come

would like to

Mutual

ing. and with hazards.
IIow

thoir

grade blue

those

get storied ond
you

timel. then

at

of the

one

forms

attractive

most

they

Many

living.

don't

people

stocks. They

a

few

hedge)

that

will

have to learn to

you

can

walk,

and

learn to run!

These

Reach

Investors?

You reach people and

what
and

to

they
you

time.

them.

take

You

it

sell

You

believe
don't

be

to

easy,

Eric S. Heymarm

gain their

understanding and cooneration bv
showing them something that is
familiar

free man.

the

to

adapted
forms

for their savings ahead
capital gains, and the

security

of

pioneering individualism; the free
enterprise system or the cult of
blind conformity; the robot or the

were

of "dollar type" securities

those
who
are
emotionally adMany of these individuals misW- to having Telephone. let
are
just not "risk takers." Thev them buv it! Yes. encoima®"* them
have placed what they believe is to buv it. It is still a $9 dividend

afraid

social system ever pro¬
pounded; freedom to live under

sav¬

investment
they

do with

bdys the safest

he

ment.

than

any

people

their

of

of

scsme

or

The

because

considered)

(so

of

minimum

bulk

tvpe

so

conservative

most

tively promoted the ideal of hu¬
man
freedom, with greater mate¬
rial abundance for more people,

the

the

this

ings

gain*"

inflation.

about

invita¬

so-called

by

"caoital

to

psychologically

The Soviets have tried to legis¬
late the perfect society; and today
the average Soviet citizen has lit¬
tle

investments"

when

it

billions still in government
in

taxable "dollar type"

investments what he can

Conservative

litical power. It is the oldest, most highs everv month, and this with
all the talk of inflation.
There
rescue liberty from the constantly reactionary of all forms of social
It was tried out in are millions of investors who are
expanding grasp of governmental organization.
ancient Babylon, ancient Greece even now seeking a safe K*»yen fnr
power.
The great patriots, of the
and ancient Rome; in Mussolini's their funds. There is still plenty
American Revolution revolted not
Italy, in Hitler's Germany, and in of confidence in these time tested,
so mUch against the actual taxes
all communist
countries.
Wher¬
old
fashioned, investments- that
imposed upon them by a British
ever and whenever it has been at¬
are tied to the steadily depreciat¬
King but against the concept of
tempted, it has failed utterly to ing American dollar.
government behind the taxes; the
provide economic security, and
These people are not going to
concept that government had unhas generally ended in national be lured out of their "dollar tvpe
limited

a

country

can

men

affairs.

contest for ages has been to

month
ago,
Senator curtail the power of the people,
Byrd, the most potent financial always under the pretense of takvoice in Congress, warned that he ing care of the people.
That is
feared the country would "go over why they tried to bind the govOnly

free

take

and that
power to do what governJapan's present prosperity, built ment thought proper. They had a
on its postwar occupation budgets,
deep suspicion that government
has never been surpassed in mod- it permitted, would waste the la-

tively safe then as now,

ern

phenomenally good.

14ly prlUnts
accZulat,on !md thereby blocks expansion

frailties.

than

graduatpd

b^°^^fradc7lcal^L K|®

f*know

these

a

^es ol a giaduated income tax

largeUportion
Th°i«a^

of

rates

a

push

them

safety

bit at
a

a

young

Eric S. Iieymann of
N.

Y.,

Stock

a

Fovest Hills,

member of the New York
Exchange,

passed

away

July 23 at the a?e of "53, while on
a

trip to Switzerland.

Z\umber 5660

Volume 186

The Commercial and Financial Chronicle

...

(511)

The

Indications of Current

following statistical tabulations

latest week

Business Activity

week

or

month ended

or

Latest

STEEL

AND

IKON

AMERICAN

(percent of capacity)

steel operations

Indicated

Previous

Month

Week

INSTITUTE:

month available.

Week

Ago

of quotations,

§82.2

•79.4

78.5

16.9

Aug.

oil

output—daily

condensate

and

4

§2,103,000

•2,033,000

2,009,000

415,000

of
—July 19

(bbls.

average

gallons eachi
Crude runs to stills—daily average (bbls.)
42

Gasoline

6,947,100

6,882,050

7,237,900

7,110,800

DEBITS—BOARD OF GOVERNORS OF
THE FEDERAL RESERVE
SYSTEM—Month
of June (in thousands)

July 19

(bbls.)

output

Distillate fuel oil

:

—

7,972,000

7,859,000
27,313,000
1,895,000

2,063,000

12,043.000

13,000,000

11,751,000

12,760,000

7,539,000

7,739,000

7,716,000

Year

Month

Ago

$193,303,000

$186,540,000

$52,800

•$52,600
•13,100
23,700

$48,600

*$89,300

$85,100

$454,000

$483,000

$476,000

12,935,000
7,575,000
5,360,000

♦12,886,000
•7,587,000
•5,299,000

13,108,000

104.6

•104.2

•106.0

163.1

♦160.9

•158.5

16,826,000

OF

Month

—

$197,181,000

$89,700

of

DEPT.

—

SERIES

COM¬

of

May

7,868,000

26,469,000

dollars):

Manufacturing

_I~~III"III

Wholesale

13,000

Retail

Stocks at refineries, bulk terminals, in transit, in pipe lines-

unfinished

of that date:

Previous

23,900

NEW

(Millions

26,954,000

1,752,000

INVENTORIES

MERCE

8,076,000

26,861,000

1,717,000

July 19

—

(bbls.)

Residual fuel oil output

U7,749.000

July 19

(bbls.)——.

output

BUSINESS

July ID
—July 19

output (bbls.)—

Kerosene

are as

BANK

AMERICAN PETROLEUM INSTITUTE:
Crude

either for the

are

Month

Ago

4

(net tons)

cases

Latest

Equivalent to—
Steel ingots and castings

in

or,

Year

Aug.

■

production and other figures for thi

cover

Dates shown in first column

that date,

on

Total

July 19

178,267,000

181,973,000

189,225,000

178,352,000

29,627,000

29,253,000

27,975,000

28,369,000

Distillate fuel oil (bbls.) at

July 19
July 19

129.798.000

125,564,000

110,282,000

103,734,000

Residual fuel oil

July 19

48,314,000

47,020,000

43,885,000

42,164,000

July 20
(no. of cars)—July 20

743,359

Finished

and

gasoline (bbls.) at

(bbls.) at

Kerosene

—

(bbls.)

at_

COMMERCIAL
ERAL
As

30

PAPER

RESERVE

of

June

30

12,700

23,900

OUTSTANDING—FED¬

BANK

(000's

OF

NEW

YORK—

omitted)

ASSOCIATION OF AMERICAN RAILROADS:

freight loaded (number of cars)
.freight received from connections

Revenue
Revenue

CIVll,

CONSTRUCTION

ENGINEERING

691,991

571,289

EMPLOYMENT

746,764
623,086

481,118

648,492
564,277

.OF
All

NEWS-RECORD:

136,239,000

$396,896,000
240,637,000

280,020,000

184,083,000

193,896,000

156,259,000

233,782,000

141,904,000

155,184,000

42,139,000

38,712,000

115,533,000
40,726,000

and municipal

State

coal

Bituminous

and lignite

July 20
July 20

(tons*

STORE SALES

10,080,000

•7,550,000

10,395,000

437,000

77,000

639,000

104

119

(COMMERCIAL

FAILURES

BRADSTREET,

steel

Finished

—

—

(E.

PRICES

refinery

Export
Lead

< New York)

Lead

(St.

Zinc

Louis)

tin

(New

5.967c

5.967c

$66.15

$64.95

AVERAGE

Weekly

:

—

pig. 5'9'i t at—
at

Nondurable

.

corporate

$54.83

$49.50

28.600c

28.750c

28.850c

39.375c

26.775c

26.900c

27.175c

36.375c

Hourly

24
24
24

14.000c

14.000c

14.000c

16.000c

All

13.800c

13.800c

13.800c

15.800c

Durable

10.500c

10.500c

11.000c

14.000c

Nondurable

24

10.000c

10.000c

10.500c

25.000c

25.000c

25.000c

24.000c

24

96.000c

96.000c

97.625c

95.750c

July 30

86.81

86.32

86.33

93.28

91.62

91.91

92.93

103.64

LIFE

Railroad

Group

Juj>' 30

Industrials

U- S.

107.09

94.26

95.16

105.52

92.06

92,50

93.97

85.59

86.38

98.73

July 30

89.92

89.92

91.34

101.97

July 30
Jub 30

92.64

92.93

94.26

103.97

92.20

93.08

93.08

104.66

JujY 3°

3.64

3.69

3.69

3.03

—.—

corporate

—;——

4.30

July 30

,

—

a*

(

4.28

4.04

-

Railroad

Industrials

Group

,

Group

.—

COMMODITY INDEX

MOODY'S

received (tons)—_——.
(tons)

Orders

of activity
Unfilled orders (tons) at end of

it

Percentage

OIL,

AVERAGE

ACCOUNT

IOR

Industrial

purchases

4.32

4.20

4.20

3.47

427.7

424.5

411.4

Total

20
20
20

249,882

199,159

230,949

226,750

264,778

153,861

275,348

55

93

89

20

464,699

488,517

372,551

493,626

110.21

110.15

108.99

110.27

V

Total

1,307,310

1,248,990

170.930

935,580

1,242,810

1,362,600

1,263,680

1,106,510

6

218,450

246,100

211,520

261,490

6

17,700

29,200

15,800

7,600

6
6

215,360

218,990

218,520

237,690

233,060

248,190

234,320

245,290

July
July

6
6

480,800

452,091

371,930

434,823

78,050

84.090

102,450

72,270

6
6

446,009

445,372

387,990

483,103

524,059

529,462

490,440

555,373

July

6

1,931,840

2,005,501

1,832,440

1,789,493

6

330,320

340,960

337,940

250,800

6

1,669,609

1,799.292

1,650,500

1,656,373

—

—

sales

Total sales

———

round-lot transactions for account

Total

purchases;

Short

sales

——.—

-—

sales

Other

Total sales

-

July

of

31

May

Odd-lot

by dealers
shares-

sales

Number

of

(customers'

1,999,929

6

2,140,252

1,988,440

of

other sales.

Round-lot sales
Number

6

1,177,427

6

$61,855,993

1,243,296

1,040,077
$58,590,113

TOTAL

7,490

6,099

6

890,015

913,718

879,940

6

$45,994,118

$47,024,644

$44,688,041

Total

round-lot

OF

—July
1— July

6

194,240

207,870

237,090

6

4,958

2~0~7~876

237,090

6

516,370

536,590

354,260

♦$325.2

*238.3

•225.6

♦102.4

63.6

•63.4

59.6

33.1

♦33.0

•30.7

39.7

•39.5

•37.6

—

6
6

9,260,960

405,140
9,471,820

8,802,590

9,664,450

9,876,960

9,230,700

All

1

than

farm and

foods

—U.

^Revised
of

118.0

118.0

117.1

114.1

93.4

*92.9

90.2

90.8

106.6

♦107.1

105.1

102.4

99.2

91.3

81.9

125.5

*125.5

125.2

121.4

July 23

Monthlv

figure.

1!Includes

1,286,000 barrels of

foreign crude runs.

§Based

on new annual capacity of 133,495,150 tons

1S57, as against Jan. 1, 1956 basis of 128,363,090 tons.
tNumber of orders not reported since introduction of
r-vagplan.
TPrime Western Zinc sold on delivered basis at centers where freight from East St. Louis exceeds

Jan.

1,

one-half cent z,

pound.




DEPT.

OF

—

•29.4

•21.6

•18.4

•327.5

•309.8

INDEX

AGRICUL¬
15:
244

vegetables, fresh

—

243

245

241

products

244

261

283

315

290

270

266

273

173

grains

192

225

219

246

228

261

260

>

—

179

218

grains and hay

263

259

152

334

457

453

245

241

231

247

248

245

287

278

251

145

Livestock

156

457

144

172

317

310

235

$839,887

$797,509

$872,304

—

Dairy products
Meat animals
Poultry and eggs

—
——

FINANCING IN NON-FARM
S. — HOME LOAN BANK
of May (000's omitted):
Savings and loan associations
ESTATE

AREAS

U.

OF

BOARD—Month

Insurance

Bank

companies

and

_

j

,

[

*

y

•

■

I

companies
banks

trust

Mutual savings

as

FARMERS

BY
S.

Wool

July 23

commodities other

farm

REAL

foods

•31.2

21.5

/

July 23

products

Processed

RECEIVED

Food

8,186,310

197.5

Farm

•50.0

31.2

—

Cotton

317,300
7,869,010

6

'

l

•5.7
•7.5

•50.8

328.3

—

income

nonagricultural

Potatoes

July 23

commodities

*6.8
•7.8

50.8

Tobacco

.

,

7.9

payments

transfer

97.7

in¬

income

Oil-bearing crops

U. 8. DEPT. OF

LABOR—(1947-49= 100):

contribution for special

6.8

labor

Crops
Commercial

352,230

Commodity Group—
All

—

——

employees'

NUMBER

192~420

July
July

PRICES, NEW SERIES

industries

—

TURE—1910-1911=106—As of June

1

WHOLESALE

$343.8

STATES

♦$342.9

PRICES

l

428.110

2,390,691

COMMERCE)—Month

OF

Fruit

403,490

65,834

2,211,152

102.0

Total

(SHARES):

;

104,288,895

75,512

2,274,712

Proprietors and rental income
Personal interest income and dividends

sales—

sales

218,5 «j,xti9

100,060,628

239.2

Service

ON THE N. Y. STOCK

sales

Other

228,584,529

120,310

billions):

personal income
and salary receipts, total
industries
Distributing Industries

6
194,240

836,137

227,92 7,859

:

bonds

33,934
329,774

817,190

751,229

July

Short

$2,819,641

39,059

319,579

Wage

Feed,

Total sales

$2,833,264

Commodity producing

192,420

July
SALES

$30,513,000

98,482,499

shares

listed

Total

All

MEMBERS

(in

June

of

745,130
$39,103,645

4,169

6

ROUND-LOT STOCK TRANSACTIONS

AND

ACCOUNT

$30,519,000

820,376

balances

borrowings on other collateral

(DEPARTMENT

dealers—

ROUND-LOT STOCK

EXCHANGE
FOR

887.430

918,676

July

sales

Other

894,184

6

July
July

Short sales

Round-lot purchases by
Number of shares

of

credit

PERSONAL INCOME IN THE UNITED

$49,804,582

July

sales

listed

of

value

free

Member

1

922,843

$67,174,539

,

by dealers—

of shares—Total

27,814

31,244

value

Total

—

♦28,586

321,144

S

surance

—

$48,566

$2,917,878

balances—.

borrowings on U. S. Govt, issues—

Other

—July
July

short sales

Customers'

20,443

*$52,577

$28,123

June

customers

customers'

Government

July

Customers'

debit

net
to

hand and In banks In U.

on

of

Member

1,907,173

Odd-lot purchases

Dollar value

*22,008

carrying margin accounts—

extended

Market

Less

by dealers (customers' sales)—
Number of orders—Customers' total sales

♦$30,569

$30,836,000

EXCHANGE—As

Member

purchases)—t

——

$30,667

-

(000's omitted).—-

customers'

Cash

COMMISSION:

Dollar value

—

omitted):

(000's

Credit

TRANSACTIONS FOR ODD-LOT ACCOUNT OF ODDDEALERS
AND
SPECIALISTS ON N. Y. STOCK

EXCHANGE

•$4,603

22,165

STOCK

YORK

LOT

EXCHANGE —SECURITIES

•$5,907

28,586

Total

of members—

——

._—

•602

•1,018

$52,832

Member firms

219,690
1,043,990

July
July

purchases
salps

Other

NEW SERIES

Sales

1,093,180

227,670

1,134,930

July

Snort

STOCK

1,282,590
234,570

—

•569

•1,510

(million of dollars):

May

—

transactions initiated off the floor—

Other

Total

OF COMMERCE)
of

Nondurables

31

1,008,240

sales

Total

574

MONEY IN CIRCULATION—TREASURY DEPT.

July
July

sales

*$2,983

May

Total

6
6
6

sales

Oilier

of

_

249,020

87

Total

purchases

Short

•$3,828

INSTITUTE

;

(DEPT.

transactions initiated on the floor—

Other

—s

Month

July
July

:

$493,100,000

MANUFACTURERS' INVENTORIES AND SALES

.-.July

Total sales

92,200,000

$560,800,000

$6,224

3.51

As

July
————July

86,400,000

104,700,000

3.63

4.12

NEW

—-——.——July

...—— i~.

sales

110,600,000

Inveui/uneo—

Jujy 6

———

—

—

sales

Oiher

9,600,000
41,700,000

$3,970

—

Month

3.83

4.42

4.21

BERS, EXCEPT ODD-LOT DEALERS AND SPECIALISTS:
of specialists in stocks in which registeredShort

—

44,100,600

3.54

MEM¬

OF

55,900,000

9,800,000

1,680

Transactions
Total

PURCHASES

3.42

429.7

July 26

'

TRANSACTIONS

ROUND-LOT

period

100

=

3.33

4.68

$212,300,000

63,500,000
►

44,600,000
108,700,000

-

INSURANCE

LIFE

4.14

4.74

$228,100,000

92,000,000

INSURANCE

Ordinary

-;.i

4.42

REPORTER PRICE INDEX-

PAINT AND DRUG
ID 19

9,400,000

_

Durables

—July
— July
July
July

——

Production

$233,600,000

63,200,000
f

(000,000's omitted):

ASSOCIATION:

PAPERBOARD

NATIONAL

L_:

$551,500,000

3.53

*

4.26

July 30

—

LIFE

OF

*

4.24

1.81

May:

Total
LIFE

2.09

1.88

TO

Policy dividends

4.23

July 30
July 30
JulY 30

Group

Utilities

of

payments

4.06

,

PAYMENTS

INSTITUTE

—

endowments

3.97

4.12

4.27

jujy 30

4.21

,.

4.01

4.15

jjjj

—

Public

103.47

$1.97

•2.18

1.89

payments
Surrender values

OF
———■—

4.75

1

.

$2.06

2.19

Annuity

YIELD

BOND

Average

;An*

Group

96.54

40.8
39.2

$2.07

-

goods

benefits

Disability

95.92

——•

DAILY AVERAGES:
Government Bonds———-———*

MOODY'S

goods

INSURANCE—BENEFIT

Matured

95.47

■—

Group

40.2

40.2

♦38.9

earnings—

manufacturing

Death

July 30

.

_____

39.7

39.1

;

INSURANCE—Month

±—

Utilities

Public

-

—

.70.95

40.5

goods

POLICYHOLDERS

85.46

-

~~

85.27

•73.13

39.9

goods

Nondurable

93.82

A*

•87.64

73.90

13.500c

24

$79.19

80.70

goods

manufacturing

Durable

—-•——-—-—

$81.78

OF

Hours—

$54.17

July 24
July 24

——

DEPT.

Durable

AVERAGES:

DAILY

S.

June:

of

manufacturing
goods

5.179c
$60.61

$53.83

July
July
July
July
———July
July

a

—_—.

7,025,000.

HOURS—WEEKLY

ESTIMATE —U.

$64.56

•

—-

at—

York '

-

9,800,000

•6,868,000

earnings—

5.670c
<

All

\

at—

PRICES

BOND

Average

274

—

Government Bonds—

S.

271

July 23
July 23
July 23

.

at

*iiiminum, (primal"

u.

266

16,825,000

•9,380,000

$82.59

goods

•16,743,000

9,879,000
6,947,000

goods

LABOR—Month

—..

-

at—-———
at

St. Louis)

(East

Straits

11,295,000

228

J. QUOTATIONS):

M.

&

(delivered)

MOODY'S

12,111,000

All

—

Average=100)—All

manufacturing

Nondurable

A

—

Electrolytic copper—
Domestic refinery at—

{Zinc

12,306,000

5,472,000

of

FACTORY EARNINGS AND

12,243,000

7,636,000

Avge=100)—

.

number

Durable

July 25

DUN

—
—

lb.»—

(per

Pig iron (per gross ton)-———
Scrap steel- (per gross ton)_;
METAL

All

COMPOSITE PRICES:

AGE

IRON

INDUSTRIAL)

AND

IXC

(1947-49

employees in manufac¬
turing industries—

96

July 27

(in 000 kvrh.)

output

Electric

of

workers)

I

goods
indexes

manufacturing

579,000

101

INDEX—FEDERAL RESERVE
= 100
July 20 *

DEPT.

SERIES—Month

(production

All manufacturing
Payroll indexes (1947-49

INSTITUTE:

ELECTRIC

EDISON

Employment

9,047,000

SYSTEM—1947-49 AVERAGE

S.

goods

Estimated

(tons)

anthracite

Pennsylvania
DEPARTMENT

manufacturing

Nondurable

OF MINES);

S. BUREAU

(U.

OUTPUT

COAL

$386,363,000
202,280,000

$330,135,000

113,616,000

—

construction

Public

$393,636,000

July 25

_»

July 25

—July 25

construction

Private

LABOR—REVISED

Durable

construction

S.

U.

July 25

46,238,000

Total

PAYROLLS—U.

June:

ENGINEERING

—

AND

Individuals
Miscellaneous

Total

124,820

115,540

158,375

373,559

357,498

507,942

120,520

110,173

152,085

314,405

371,079

306,070
3a7,151

318,133
425,359

$2,144,270

$2,043,941

$2,434,198

----—

lending

institutions—

The Commercial

40

Financial Chronicle... Thursday, August

and

ADDITIONS

A INDICATES

Pasadena, Calif.
Mav 3 filed 184.000 shares of common stock, of which
'42,000 shares are to be offered to public and 92,000 shares
issued to promoters. Price—To public, SI per share; no
proceeds from sale to promoters. Proceeds—For general
Expansion Corp.,

America

Ail

SINCE

Registration

Now in

Securities
O

1, 1957

(512)

•

filed 631,925 shares of common stock (par 10
Price — At market (approximately 53 cents per
share). Proceeds—To selling stockholders. Underwriter
May

(8/15)

7

cents).

filed $1,600,000 first mortgage 6% bonds due
Aug. 1, 1982, S800,000 6V2 sinking fund subordinated de¬
bentures due Aug. 1, 1977, and li2,000 shares of common
July

REVISED

Daybreak Uranium, Inc., Opportunity, Wash.

Natural Gas Corp., Hickory, N. C.

A Carolina

ITEMS

ISSUE

PREVIOUS

26

Herrin Co., Seattle,

be offered in units of $100 of bonds, $50
and seven shares of stock. Price—To be

stock (par $1) to

Business—Purchase and resale of

purposes.

Wash.

>il fruits

in Brazil and other

grown

President.

Paper Corp., Chicago,

Allied

countries. Under-

of Pasadena, Calif., is
Statement effective July 23.
LeRoy R. Haynes.

vriter—None.

III.

a

Allied-Albany Paper Corp. on the basis of 5 • 22nd of
share of Allied stock for each share of Allied-Albany

.ritock; offer to expire on Sept. 6.
Alsco, Inc., Akron, Ohio
filed 200,000 shares of common stock (par
Price—To be supplied by amendment. Proceeds —
expansion, repayment of loans arid for working
Underwriter—To be named by amendment.

f-una,

For

capital.

New

Inc.,

York

24

is President. Invest¬
Cycle Research Corp., New

Burton H. Jackson

writer—None.
ment Adviser

—

Securities

i

York.

Provident

American

Feb. 15 filed 50,000.000

Price—S2

;ent).

Corp.

Investors

shares of common stock (par one
Proceeds — For working

Capital an-d general corporate purposes. Office—Dallas, \
Tex.
Underwriter—Peoples Securities Co., J. D. Grey,
>f New Orleans. John S. Tanner, of Dallas, and C. L.
of Houston, three of the 22 directors, are
Chairman, Vice-Chairman and President, respectively

'Sdmonds,

American

(letter of notification) $120,000 of 10-year 6%
first mortgage bonds (in denominations of $1,000 each),
120 warrants for common stock and 1.500 shares of com¬

July 11

mon

stock

(no

Each $1,000 bond has detachable
$15 per share exercis¬

par).

warrants for 10 common shares at

able at any time through June 30. 1959. Price—Of bonds,
at par.
Proceeds — For construction and improvements,

capital. Office—5020 Wis¬
D. C.
Underwriter—Mackall

payment of debts and working
consin

Washington.
Sc Coe, i Washington, D. C.
Ave.,

Apache Oil Corp..

quire, develop and operate oil and gas leaseholds: and for
Underwriter none: sales to be

other corporate purposes.

filed

30

(8 20)
of convertible subordinated
Price—To be supplied by
Proceeds—To repay $81,000,000 of bank
$100,000,COO

debentures due Aug.
amendment.

15, 1987.

loans and for acquisition and

development of production
properties and for acquisition and improvement of re¬
fining, marketing and transportation facilities. Under¬
writer—Smith, Barney & Co., New York.
A Axe-Houghton Fund A, Inc.
July 25 filed (by amendment ) 1,000,000 additional shares
of common stock (par $1): Price—At market. Proceeds
—For investment.
Office—Tarrytown, N. Y.
A Bridgeview Towers Associates, Fort Lee. N. J.
July 25 filed $360,000 of participations in partnership
interests.

Price—$10 000 each

)Proeeeds—To

buy

an

participation (minimum).
apartment building. Underwriter

—None.

'

C & D

March

23

(letter of notification)

14.000 shares of

com¬

For

machinery, equipment, inventories and
working capital. Office — Washington and Cherry Sts.,
Conshohocken, Pa. Underwriter—None.
—

Calidyne Corp., Winchester, Mass.
May 1 filed S1.250,000 of Limited Partnership Interests to
be offered first to present limited partners at the rate of
one $1,000 unit for each $1,000 of his present investment;
then to public. Price—$1,000 per unit. Proceeds — To
construct plant: to purchase machinery and equipment:
and to reduce outstanding demand notes. Business—Pro¬
duces electro-dynamic shaker and other vibration test
equipment. Underwriter—None. Robert C. Lewis. Philip
C. Efromson and Thomas Gouzoula. all of Winchester,
Mass.. are the general partners of this Massachusetts
Limited Partnership,
Cameron
June

purchase properties and to make advances to and in¬
vestments in stock of subsidiaries. Underwriters—Paine,
Webber, Jackson & Curtis, New York; and Loewi & Co.,

4

cents).

filed

Industries,

Inc.,

300,000 shares of

Price—51 per share.

and development program.
Co.. Inc.. New York.
Caramba

New

York

•

common

stock

».

(par

10

Proceeds—For exploration

Underwriter—R. G. Worth &

Mokafe Co**o. of

stock (par 10 cents

Co.

(8/5-7)

(Canada)

Ltd.

convert-

supplied
To repay bank loans, for
exploration and development of properties and for gen¬
eral corporate purposes.
Underwriters — Lehman Bro¬
thers and Bear, Stearns & Co., both of New York, to
handle sales in the United States; part to be sold in
Proceeds

by amendment.

Canada through

Co., both off New York. Exchange
Trust Co., Newark, N. J.

Phoenix, Ariz.
$4).
and
16,500 shares to employees pursuant to stock purchase
options. Price—To public, $lf per share. Proceeds—For
expansion and other corporate purposes. Underwriter—
None.

A First Security Bond & Mortgage
July 24 (letter of notification) 25,000

City, Miss.

stock

May 1 filed 150.000 shares of class C common stock to
and other users of fertilizer
materials.
Price—At par ($25 per share).
Proceeds—
and

construct

Florida

Corp., Yazoo City, Miss.

stock from an estate for an

common

the

aggregate amount

Underwriters

Curtis and Blair & Co.

—

Alhambra,

4

850

filed

Pompano Beach, Fla.
certificates of beneficial

Price—$1,000

Trust.

certificate.

per

Underwriter—None.

$1,054,'613, and for working capital and other corporate

purposes.

Trust,

St.,

Bay

West

interest in
Proceeds—To
acquire by purchase, lease or otherwise, and to hold,
own, subdivide, lease, mortgage, exchange, bargain, sell
and convey lands and every character of real property.
March

Producing Co. (8/20-21)
July 30 filed 150,000 shares of common stock (par $1).
Price
To be supplied by amendment.
Proceeds — To¬
gether with other funds, to purchase 150,659 shares of
A Coastal States Gas

of

and 12,500 shares of common stock (par

(par $10)

working capital.
Olfice—36
Calif. Underwriter—None.

facilities for manufacture of
Underwriter—Mississippi Chemical

operate

anhydrous ammonia.

Corp.

shares of preferred

$1) to be offered in units qf two shares of preferred and
one share of common. Price—$21 per unit. Proceeds—For

be offered for sale to farmers

To

Agent—Fidelity Union

At First National Life Insurance Co.,

shares of common
Price—50 cents per share.
(U. S. funds). Proceeds—For exploration costs, etc. Of¬
fice—5616 Park Ave.. Montreal, Canada. Underwriter—
Jean R. Veditz Co., Inc., 160 Broadway, New York.
Coastal Chemical Corp., Yazoo

DealerTrask &

July 29 filed 106,500 shares of common stock (par
of which 90,000 shares are to be offered publicly

(par $1—Canadian).

stock

Colonial stock and will con¬

including Aug. 16, unless extended.

Managers—Tbe First Boston Corp. and Spencer

(8 20)

Corp.

shares of capital stock (par $4) be¬

holders of more than 86% of

Canadian underwriters.

Uranium

Chess

filed 400,000

tinue to and

—

May 14 (letter of notification) 600,000

Fluorspar Corp. of America

Paine, Webber, Jackson &

May 28 (letter.of

Incorporated, both of New York.

notification) 30,000 shares of common

$1) to be offered for subscription by common
share for each four
shares held. Price—$8.50 per share. Proceeds—For min¬
stock (par

Aircraft

Colonial

Corp.,

Sanford,

Me.

stockholders on the basis of one new

July 5 filed 248.132 shares of common stock (par 10£).
Price—At market.
Proceeds—To selling stockholders.

Frigikar Corp.
6 (letter of notification)

Memphis, Tenn.

Comico Corp.,

June

May 2 filed 750,000 shares

Southeastern Securities Corp., New

stock

50

(par

cents).

Price

. .

General Aniline & Film Corp.,

(letter of notification) 150,000 shares of common

..

9,000 shares of common
At market (estimated

—

writer—Muir Investment Corp., San

Dilling¬
Under¬

Antonio, Texas.

New York

of common A stock (no par)
and 1.537.500 shares of common B stock (par $1).
Pro¬
ceeds—To the Attorney General of the United States.
Underwriter—To be determined by competitive bidding
Probable bidders: Blyth & Co., Inc., and The First Bos¬
Jan. 14 filed 426,988 shares

(par $7). Price—At market (closing price on To¬
ronto Stock Exchange as of June 14. 1957 was $1.82 bid
stock

and $1.85 asked, per share).

74th Ave., Portland,

$5.50 per share). Proceeds—To go to Daniel D.
ham.
Office—1602 Cochran St., Dallas, Texas.

York.

Consolidated Fenimore Iron Mines, Ltd.
June 26

Office—433 S. E.

Underwriter—None.

Ore.

(8/15)
of common stock. Price—$2
per share. Proceeds—To construct mill; for payment on
mining leases and royalty agreement. Underwriter—
•

operations.

ing

Underwriter—Glick & Co., Inc., New York.

Proceeds—For mining ex¬

Office—c o Roy Peers, 9 De Casson Rd., Mon¬
treal. Canada.
Underwriters—Thomason, Kernaghan &
Co.. Ltd.. Toronto, Canada, and R, P. Mills .& Co., Ltd.,

penses.

ton

and

America
common

Price—$2 per share.

Proceeds—For
working capital.

Office—701 Monroe St., Hoboken, N. J.
Garden State Securities, Hoboken, N. J.

International Corp., Chicago,

Conticca

III.

Corp. (jointly); Kuhn, Loeb & Co., Lehman Brothers
Glore, Forgan & Co. (jointly). Bids — Had been
to be received up to 3:45 p.m. (EDT) on May

13 at Room 654. 101

shares of class A common stock
(par $1). Price—$5 per share. Proceeds — To discharge
current notes payable, including bank loans, and long
term debt in the total sum of approximately $1,030,000:
13 filed 558,100

March

for

equipment:

new

writers

and

Allen Shaw &

—

for

working

Co., 405

Continental
11

June

Mineral

Resources,

(letter of notification)

stock

Bldg.,

(par

Nev.

Reno.

Denver.

10

100.000 shares of common
Price—$2 per share. Proceeds—To es¬
facilities for manufacture and assem¬
bly of controls: and for other corporate purposes. Ad¬

stock

dress—c/o Positronic Corp., 2572

Inc.

Atlanta,

Genera!
1

Underwriter-^

of properties.

Inc., Washington, D. C.

Paterson, N.J,

preference stock, to be offered in units of S500 of deben¬
tures and 40 warrants. Price—$500 per unit.
Proceeds—
For expansion

named.

,

.

'

and working capital.

Underwriter—None

Offering to be made through selected dealers.

Application is still pending with SEC.

Leward

—

1

Motors Acceptance Corp. (8 7)
25 filed S100,000,000 of debentures, due Aug. 15.
Price—To be supplied by amendment. Proceeds—

A Genera!

-

July

Cougar Mine Development C-rp.

1977.

560.000 shares of com¬
mon stock
(par one cent). Price — 50 cents oer ?harp
Proceeds
For diamond drilling 011 company's lands,
15

Credit,

& ,Co„

Underwriter
.

Co., Atlanta,

17, 1956 filed $2,000,000 of 6% subordinated sink¬
ing fund debentures, due Sept. 1. 1971, with detachable
warrants
to
purchase 160,000 shares of participating

Underwriter—Birkenmayer

Co.. Boston, Mass.

Ridgemore Road, N. W.,

Underwriters—Armstrong &

Aug.

April 24 filed 400.000 shares of common stock (par 10
Price—$1 per share. Proceeds—For exploration

M. Lister &

Ga.

Ga.

cents).

Colo.

and development

(par $1).

tablish production

300.000 shares of com¬

Continental Mines & Metals Corp.,

/

postponed.

Corp.. Atlanta, Ga.

May 23 (letter of notification)

Lexington Ave., New

Price—SI per share. Pro¬
ceeds—For mining expenses.
Office—c/o Registrar &
Transfer Agent, Nevada Agency & Trust Co., Cheney
mon

General Automatics

Under¬

capital.

Indiana Ave., N. W., Washington 25,

C., but bidding has been

D.

17, N. Y.: and Shaw & Co., San Marino, Calif.

York

March

equipment, inventory and




Charter Oil

July 11 filed $2,250,000 of 15-year subordinated
ibid debentures due Aug. 1, 1972. Price—To be

Federal Insurance Co.

ing offered in exchange for 100,000 shares of Colonial
Life Insurance Co. of America capital stock (par $10)
on
the basis of four Federal shares for each Colonial
Share.
Offer has become effective upon acceptance by

Milwaukee, Wis.

cents).

(8 9)

July 12 (letter of notification) 120,000 shares of
machinery,

•

June 7

scheduled

stock

Proceeds

other funds, to

Proceeds—Together with

Montreal, Canada.

Batteries, Inc.

(par $10) to be offered for subscription by
ctockholclers and employees.
Price—812.50 per share.
mon

Price—To be supplied by

1972.

1,

A Educators' Investment Corp. of Alabama
23
(letter of notification) 10,000 shares of 5%
cumulative preferred stock.
Price — At par ($25 per
share). Proceeds—For capital expansion. Office—1704—
11th Ave. South, Birmingham, Ala.
Underwriter—None.
July

subordinated

convertible

of

$1,750,000

Colo. Under¬

writer—None.

(8/15)

Neb.

Co., Lincoln,

Telephone

filed

15

debentures due July

through corporation and APA, Inc., its subsidiary.

A Atlantic Refining Co.
July

ing expenses. Office—3531 Oneida, Denver,

—

MinneapoFs, Minn.

July 22 filed 200 participating units in Apache Oil Pro¬
gram 1958.
Price—$10,000 per unit.
Proceeds—To ac¬

made

July 15 (letter of notification) 140,000 shares of common
stock. Price—At par ($1 per share). Proceeds—For min¬

To

Central

July

Washington, D. C.

Trailer Co.,

—

Ore.

Ontario,

St.,

Oregon

A Eastern Slope Multi-Metal Corp.

filed 150,000 shares of common stock (par $1).
be supplied by amendment. Proceeus — For
working capital and general corporate purposes. Under¬
writers
Hornblower & Weeks and Eastman Dillon,
Union Securities & Co., both of New York.

share.

per

(8/20-21)

A Celotex Corp.
Price

S.

Olfice—710

etc.

Underwriter—None.

amendment.

filed. 500.000 shares of capital stock (par $1).
Price—At market.
Proceeds—For investment. Under¬
V5iv

Proceeds—For new construc¬
Underwriters—Cruttenden, Podesta & Co., Chi¬
111., and Odess, Martin & Herzberg, Inc., Birming¬

July 31

SI).

Ar American Guardian Life Insurance Co.
July 15 (letter of notification) 15,000 shares of common
stock (par $10).
Price—$20 per share. Proceeds—For
capital and surplus accounts. Office—1106 Desert Bldg.,
Salt Lake City, Utah. Underwriter—None.
Income

debentures

supplied by amendment.

—

June 28

American

tings,

of

ham, Ala.

July 15 filed 21.000 shares of common stock (par $8) to
be offered in exchange for outstanding common stock
of

tion/etc.

A Eastern Oregon Natural Gas C».
July 22 (letter ot notification) 35,000 shares of common
stock. Price—At par ($5 per share). Proceeds—For in¬
stallation of a distributing system, including meters, fit¬

cago,

•corporate

(letter of notification)

To

repav

bank loans and for working capital.

Under¬

writer—Morgan Stanley & Co., New York.

—

General

prospecting expenses, working capital and qther corpor¬

Office—83 Campfield St.. Trvineton "NT 1
Underwriter—Roth & Co.,- Maple wood, N. J. Offeringsate

Expected this month (July).

Parking,

Inc.

June 18 (letter

purposes.

.

of notification) 240,000 shares of common

stock (par $1),

Price—S1.25 per share.

tire

Proceeds—To re¬
subsidiary cor-

outstanding debt; for expansion of

Volume 186

poration
F.

Number 5660

and

for

Clements,

working

5312

The Commercial and Financial Chronicle

...

capital.

Glenwood

•

General

18

Genie Craft Corp., Washington, D. C.
28 (letter of notification) $150,000 of
10-year 6%
subordinate convertible debentures.
Price—At

Edwin

Youngstown, Ohio.
Co., Las Vegas, Nev.

of $100 each).
Proceeds—To discharge
obligations and for working capital. Office—
1022 18th St., N.
W., Washington, D. C. Underwriter —
Whitney & Co., Inc., Washington, D. C.

outstanding securities on a share-for-share
basis, pius, in each case, cash equivalent to the redemp¬
tion premium for each such share offered in exchange:
5 xk % and 6% cumulative preferred stocks of Durham

★ Genung's

July
due

Telephone

Co., the 6% cumulative preferred sUck ol
Georgia Continental Telephone Co., and the 5V2% cumu¬
stock

preferred

Telephone Co. and
Co.

Carolina

Curtis

of New

for

Stone

and

&

Webster

Securities

Corp.,

both

General Telephone Corp., New York
May 24 filed 1,480,787 shares of common stock (par $10}
and 170,000 shares of 5.28% convertible preferred stock
(par $50) being offered in excnange for common and

preferred
basis
of

of

stocks
1.3

Peninsular

preferred

of

Peninsular

shares

for

for

common

on

each

the

share

and one-half share of General
share of Peninsular $1 pre¬

common,

share

Telephone' Co.

General

of

each

ferred, $1.30 preferred and $1.32 preferred. No exchange
of preferred stock will be made unless at least 80% of
the
Peninsular
preferred stock is exchanged.
Offer
will expire on Aug.

Mount Vernon, N. Y.
(8/19)
$500,000 of 6J/2% convertible debentures
20,000 shares of common stock (par $1).
supplied by amendment. Proceeds—To re¬

—

•

Getty Oil Co., Wilmington, Del.
17 filed 100,000 shares of common stock
(par $4)
being offered for sale from time to time on the New

Holy Land Import Corp., Houston, Texas
(letter of notification) 100,000 shares of common

June

be made. Price—Either at the

lower

than

the

price quoted

bid

nrice

market

higher

nor

at

or

a

than

Feb. 27
stock.

the

&

asking

Horace

offering.

June

utor

None.

—

Statement

effective

Transformer

due

Automatic

filed

22

March

crease

Moulding Corp.

$1,000,000 of 6%

31,

1967.

company's

convertible

Price—At par.

activities

(John R. Boland & Co., Inc.)

August 5

$299,880

working

in¬

(Lehman

Brothers

August 6
McDermott (J. Hay)
(Offering
&

to

Sanders

and

Kidder,

&

(Bids

Associates, Inc

to

Power

110.000 shares

to

Stanley

Co.)

&

First

Goldman,

Boston

G.

(Carl M.

and

Co.;

Worth

(Jim)

The

$6,000,000

Electric

Debentures

(Bids

Common

&

Co.,

Inc.)

Natural
11:30

Co

EDT)

a.m.

September 18

$300,000

(Monday)

(Bids

..Bonds & Common

(Bids

be

to

(Bids

Thompson

Power
10

Consumers

(Minn.)

CDT)

a.m.

Products,

(Tuesday)

Co.

Power

Bonds

Inc

Debentures

to common stockholders—underwritten by Smith,
Barney & Co. and McDonald & Co.) $19,729,500

Utah

Power

&

Utah Power

August 15

(Thursday)

Co. and Odess, Martin & Herzberg, Inc.)
$1,600,000 bonds, $800,000 debentures and 112,000 shares of stock

(Paine, -Webber,

Co
Loewl &

and

Comico Corp.

Common

(Southeastern

Securities

August

Genung's Inc.

$1,500,000

Inc.)

&

Co.)

to

be

Southwestern

Invited)

Bell

Bonds

$8,000,000

1

Celotex

Gas

be

to

Uranium

Coastal States

Eastman

and

Co.)

Dillon,

to

invited)

October

Public

Service

$300,000

Gas Producing Co

(Paine, Webber, Jackson

& Curtis

150,000

and Blair

(Bids to

be

Debentures
$25,000,000

...Common
&

(Bids

Consumers

Securities

120,000

&

Co.)

invited)

August 28
(Bids

to

be

&

lOflcring

Telephone
to

&

common

i

EST)

a.m.

$30,COO,000

EDT)

$35,156,760

(Bids

to

be

...

$50,000,000

(Tuesday)

invited)

November

$40,000,000

Ohio

Power

Bonds

Bonds
11

a.m.

a.m.

EST)

3

S7.000.000

(Tuesday)

Virginia Electric & Power Co
(Bids

to

be

<

Citizens Telephone

Invited)

Proceeds—To

\

on Aug. 15, 1957.
Price—$50 per share.
retire bank loans.
Office—315 S. Second

Underwriter—None.

Mascot Mines,

Inc., Kellogg, Idaho
June 3 (letter of notification) 800,000 shares of common
stock.
Price—At par (17V2 cents per share).
Proceedn
—For mining expenses.
Office—Sidney Bldg., Kellogg,
Idaho, Malcolm C. Brown is President. Underwriter—
Standard Securities Corp., Spokane, Wash., and Kellogg,
McDermott

(J.

Ray)

& Co., Inc.

(8/6)

$20,292,000 of' convertible subordinated
Aug. 1, 1972, to be offered for subscrip¬
tion by common stockholders of record Aug. 6, 1957 on
the basis of $100 of debentures for each
10 common
18

filed

debentures due

shares held; rights to

expire

on

Bonds
820,000,000

Co.

(letter of notification)

rights to expire

July

$28,000,000

Preferred
11

December

Common

EST)

and

Idaho.

(Tuesday)

Ohio Power Co
(Bids

(Saturday)

19

Co._.Debentures

$250,000,000

Co
(Bids

$60,000,000

Telegraoh Co.

EDT)

a.m.

preferred shares;
Underwriter—None.

(no par)

St., Mankato, Minn.

(Tuesday)

American Telephone & Telegraph

(Wednesday)

invited)

11

Co., Inc., Palm Beach, Fla.

6,000 shares of common
to be offered to present stockholders, on
the basis of one new share for each five shares held;

.July 15
stock

Debentures

stockholders—bids noon

working capital, etc.

it Mankato

Bonds

$20,000,000

(Wednesday)

October 22

Bonds

stockholders—r,o underwritingt 1.822.523 shares




11

Cook

it Madison Improvement Corp., Madison, Wis.
July 29 filed 50,000 shares of common stock. Price—At
par ($10 per share). Proceeds—For working capital, etc.
Underwriter—None. Henry Behnke is President.

(Tuesday)

Preferred

/

'

August 31
Pacific

invited)

15

October 29

$70,000,000

Public Service Electric & Gas Co
i

be

to

16

(Tuesday)

Southern California Edison Co..
be

for

Consolidated Edison Co. of New York, Inc.__Bonds

shares

Bids—Ex¬

Miami, Fla.

ments; for retirement of present

Preferred

...Bonds

Co...

(Bids

August 27

to

or

$50,000,000

(Wednesday)

Power

Common

Corp.)

El Paso Natural Gas Co.__Debentures
Weld

to

(Thursday)

Holiday Inns of America, Inc

(Bids

9

October

Debentures
(Offering to

(White,

Bonds

$25,000,000

Indiana & Michigan Electric Co

Co. Incorporated)

$90,000,000

(8/20)

$2 per share for each share of stock. Proceeds—For con¬
struction of a shopping center and other capital improve¬

(Tuesday)

shares

invited)

August 22

Debenture*

Co. of Indiana, Inc

October

Telephone & Telegraph Co

(Equitable

be

(Bids

Co., Inc.)

share at $2.75 per share.

^ ianaf, Inc., Washington, D. C.
July 30 filed $10,000,000 of 5%-8% sinking fund deben¬
tures due Aug. 1, 1972 and 100,000 shares of common
stock (par 20 cents) to be offered in units of a $1,000
debenture and 10 shares of stock, or a $100 debenture
and one share of stock.
Price—Par for debenture, plus

(Thursday)

Invited)

Common

Veditz

common

stock (par 10 cents).

writer—Anderson

Union Securities

150,000 shares

Corp

(Jean R.

Pacific

(Bids

Common
Weeks

&

&

Chess

(Tuesday)

Preferred

$100,000,000

System, Inc

October 8

shares

or

$10,000,000

to

Telephone Co

to be invited)

(Bids

Corp.

(Hornblower

shares of

one

(letter of notification) 300,000 shares of com¬
Price—$1 per share. Proceeds
—To purchase a ship and for working capital. Under¬
mon

(Tuesday)

Commonwealth Edison Co

August 20

unit.

one common

Isthmus Steamship & Salvage Co.,

share*

(Wednesday)

October 3

Columbia

Class A Common

200,000

4011.000

of

First Boston Corp.; Dean Witter & Co.
pected to be received on Aug. 20.

Common

lnviiea)

oe

October

$500,000

Guys From Harrison, Inc.

to

additional

units

buy three common shares..
Each warrant entitles holder to

The

$io,000,000

Light Co

(Bids

Debentures

Brooks & Co.

(Bache

(Bids

(Monday)

u

W.

(P.

Two

19

Corp.)

Bonds

lnviiea)

in

to

Inc.; Kuhn, Loeb & Co.; White, Weld & Co.; Lehman
Brothers, and Bear, Stearns & Co. (jointly); Equitable
Securities Corp. and Salomon Bros. & Hutzler (jointly);

$35,000,000

(Tuesday)

Northern Illinois Gas Co

$1,750,000

Co.)

be

to

per

354,420

offered

May 21

Debentures

Jackson & Curtis

Bonds

September 25

! (Cruttenden^Podesta

Telephone

&

(Bids

Carolina Natural Gas Corp.__Bonds, Debs. & Com.

Central

(Monday)

Light Co

(Bids

be

warrants

July 26 filed $5,000,000 of first mortgage bonds due Aug.
1, 1987. Proceeds—To repay bank loans and for construc¬
tion program.
Underwriter—To be determined by com¬
petitive bidding. Probable bidders: Halsey, Stuart & Co.

$18,000,000

(Offerine

purchase

to

• Iowa Southern Utilities Co.

Co

September 24

Investments, Inc.
common stock (par $1)

Colo.

Bonds

(Bids 11:30 a.m. EDT)

Price

Proceeds
genera!
corporate purposes. Office — Englewood, Colo. Under¬
writer—American Underwriters, Inc., also of Englewood,,

$20,000,000

September 23
Northern States

shares held.

—To acquire stock of fire insurance unit and for

$30,000,000

$2,425,000

August 13

Insurance

to

three

Price—$3.75

$4,260,000

invited)

seven

118,140 shares of

stock

purchase

..Debentures

Pacific Power & Light Co

Loeb, Rhoades & Co. and Prescott, Shepard & Co., Inc.)

filed

share and

Equipment Trust Ctfs.
EDT)

noon

share for each

new

warrants

common

o

(Wednesday)**

Norfolk & Western Ry

Corp

$40,000,000

(Tuesday)

Gas

10

and

Bonds

invited)

one

International
June

(Thursday)

Co

be

to

Fidelity Insurance Co.

by amendment; Proceeds—For work¬
ing capital, etc.
Underwriter—Franklin Securities Co.„
Dallas, Texas. Statement effective July 18.

$30,000,000

September 17
Consolidated

(Friday)

August 12
Walter

invited)

September 12
Philadelphia

Industries, Inc
(R.

be

International

rate of

(Wednesday)

Jersey Bell Telephone Co
to

by amend¬

supplied

—To be supplied

$50,000,000

Preferred

Sachs &

Corp.)

August 9
Cameron

(Tuesday)

invited)

September 11
New

Debentures

$100,000,000

Indianapolis Power & Light Co
Brothers;

be

be

to

March 28 filed 100,000 shares of common stock (no par)
to be offered for subscrintion by stockholders at the
Bonds

(Bids

(Bids

(Lehman

•

Bonds
$15,000,000

(Wednesday)

General Motors Acceptance Corn
(Morgan

Co

invited)

Underwriters—Names

ment.

Co

(Bids

August 7

be

ital.

$20,292,000

Co.)

Class A Common

(Kidder, Peabody & Co.)

Duke

Dominick

by

500,000 shares of common stock (par
cent). Price—$1 per share. Proceeds—To equip and
establish five super launderettes and for working cap¬
one

(Wednesday)

September 10
.Debentures

Peabody

International Duplex Corp., San Francisco, Calif*.
Dec. 21, 1956 filed

(Tuesday)

Louisville Gas & Electric

(Tuesday)

& Co., Inc

Springfield, 111.

Underwriters—Lehman Brothers; Goldman, Sachs & Co.;
and The First Boston Corp.; all of New York.

Cincinnati & Suburban Telephone Co
Common
(Offering to stockholders—no underwriting)

$2,250,000

stockholders—underwritten

common

Dominick

Stearns & Co.)

Bear,

Office—216 E. Monroe St.,

Indianapolis Power & Light Co. (8/7)
July 18 filed 60,000 shares of cumulative preferred stock
(par $100). Price—To be supplied by amendment. Pro¬
ceeds—To repay bank loans and for new construction.

Underwriter—Cook Enterprise,

September 4
Debentures

and

Distrib¬

Investors,

Mann

—For investment.

capital.

CALENDAR

(Monday)

Charter Oil Co., Inc

investment.

ic Incorporated Income Fund, Boston, Mass.
July 29 filed (by amendment) 2,000,000 additional sharer*
of common stock (par $1). Price—At market.
Proceeds

debentures

Proceeds—To

for

and

September 3
Debentures

Proceeds—For

•

(Friday)

Corp

market.

Investment Manager—Horace

President.
Gibbs

May

Fund, Inc., Springfield, III.
100,000 shares of capital stock (par $1),

Inc., Des Moines, la., of which Charles F. Martin is also

July 22.

Inc., Ill S. 7th St., Terre Haute, Ind.

Precision

and

Proceeds—For in¬

Underwriter—Benjamin

Mann

filed

Price—At

Underwriter

Corp.

August 2

27

stockholder.

Office—Henderson, Ky.

ISSUE

working capital, etc.
Co., Houston, Tex.

Proceeds—To J. Paul Getty, President, who is the
selling

14. Dealer-Managers—Paine, Web¬
ber, Jackson & Curtis and Stone & Webster Securities

NEW

Price—At par ($3 per share).

ventory,

may

price not

the Exchange at time of such

on

per share.
Proceeds
costs, improvements, expansion, etc.
Angeles, Calif.
Underwriter — Dempsey-

Los

★ Holiday Inns of America, Inc. (8/22)
July 26 filed 120.000 shares of common stock (par $1.50).
Price
To be supplied by amendment.
Proceeds — For
working capital and for construction program. Under¬
writer—Equitable Securities Corp., Nashville, Tenn.

Inc., New York.

Exchange. Certain private placements

—

Tegeler & Co., St. Louis, Mo.

,

Stock

basis of

exploration

Office

bank loans and for increased inventories and other
corporate purposes.
Underwriter—P. W. Brooks & Co.

York

York.

—For

pay

Telephone

Aug. 30, 1957. All shares
exchange will be redeemed in Sep¬
Dealer-Managers—Paine, Webber, Jackson

tember, 1957.

Price—To be

Continental

Continental

Southern

This offer, wall expire on

not surrendered

6

South

of

of

and

on

one-fourth share of Natural Gas stock for each share of
Oil & Chemical stock. Price—$1.25

Inc.,

26 filed
1977

Corp.

holders of Great Lakes Oil & Chemical Co.

short term

following

Gas

15 filed 779,393 shares of common stock (par 50
cents) to be offered for subscription by common stock¬

(in

par

Natural

41

July

denominations

Telephone Co. of the Southeast

filed

120,000 shares of 5.80% cumulative pre¬
ferred stock (par $25) to be offered in exchange for the

lative

Great Lakes

June

Ave.,

Underwriter—L. L. LaFortune &

July

Office—c/o

(513)

,

Aug. 20, 1957. Price—To

Continued

on page

42

*

The Commercial
42

Financial Chronicle

and

Thursday, August 1, 1957

...

(514)

Continued from page

Proceeds—For expansion of
Underwriters—Dominick & Dominick and
Kidder, Peabody & Co., both of New York.
Mercast Corp., New York, N. Y.
June 24 filed 420,778 shares of capital stock
(par 10
cents) being offered for subscription by stockholders of
record July 18, 1957 on the basis of two new shares for
each three shares held; rights to expire on Aug. 2. Price
—$4.25 per share. Proceeds—For expansion program, to
repay outstanding notes to Atlas Corp. and for working
supplied by amendment.

be

operations.

Merchants

Co.

(letter of notification) $300,000 of 6% converti¬
subordinate debentures due 1972 being offered to

ble

and

common

record of July

preferred stockholders of

basis of $125 of debentures for each
18 shares of stock held; rights to expire on Aug. 5, 1957.
Price—At par in units of $125 each and multiples thereof.
Proceeds—For working capital.
Office—300 East Pine
St., Hattiesburg, Miss.
Underwriter — Lewis & Co.,
Jackson, Miss.
1
1957,

11,

on

the

Mississippi Vailey Portland Cement Co.
Dec. 26,

1956 filed 1,600,000 shares of capital stock (no
par) of which 708,511 shares are subject to an offer of
rescission. Price—$3 per share. Proceeds—For comple¬
tion of plant, provide for general

creditors and for work¬
Office—Jackson, Miss. Underwriter—None,

ing capital.

offering to be made through company's

agents.

own

Mon-O-Co Oil Corp., Billings, Mont.
July 11 filed 22,474 shares of class A common stock and
539,376 shares of class B common stock to be offered in
units of

one

class A share and 24 class B shares,

which

chall not be separately transferable until May 1, 1960.

Of

the

units, 14,474 are to be issued in exchange for or con¬
version of working interests in joint lease acreage oper¬
ations, etc., and 8,000 are to be offered for subscription
by existing stockholders, on a pro rata basis. Price—$75
per unit.
Proceeds—For development and exploration
costs, etc. Underwriter—None.

4c Montek Associates, Inc.
July 16 (letter of notification)
stock

(par $1).

chase

Price—$2

additional

per

electronic

v

60,000 shares of

common

share. Proceeds—To

pur¬

test

equipment, shop ma¬
chinery, and to increase working capital. Office—2604
South State St., Salt Lake City, Utah.
Underwriter—
D. Richard Moench & Co., Salt Lake City, Utah.
Monticello Associates, Inc.
Feb. 18 (letter of

stock.

notification) 300,000 shares of

Price—At par

capital

($1

common

share). Proceeds
including construction of

expenditures,

per

For

—

motel,

roadside restaurant and gas station. Business—Has been

•

Oil

Sire

UnderwriterUtah, Shit Lake City,

Inc. of

Securities,

„•

of beneficial interest.

investment.

(par 50 cents). Price—$1 per share. Proceeds—For ex¬
ploration and related purposes, including construction of
Underwriter

Investment Service Co., Denver,

—

Colo,

Municipal Investment Trust Fund, Inc. (N. Y.)
May 9 filed 5,000 units of undivided interests in Munic¬
ipal Investment Trust Fund, Series A.
Proceeds—For investment.

Price—At market.
Sponsor—Ira Haupt & Co.,

New York.

Mutual

To be determined

by competitive bidding.

Probable bid¬

^ Pacific Telephone & Telegraph Co. (8/31)
July 26 filed 1,822,523 shares of common stock

East

to

writer

market.

Proceeds—For

stock

(par

Stratford

Strato-Missiles, Inc.
June 7 (letter of notification) 300.000 shares -of common
stock (par 10 cents). Price—$1 per share. Proceeds—To
develop Hatfield propulsion system, and other projects;
for purchase of additional facilities
and for working
capital.
Business—To produce machinery and equip¬
ment.
Office—70 East 45th St., New York, N. Y.
Un¬

$1)

•

shares

debentures

due

June

1,

1967

10-year

29,400

and

March

indebtedness

and

Mice-President, 400 Walnut Ave.. Bronx, New
York; N. Y./ Enderwriter — Wm. T. Tegtrr.eyer & Co.,
Davis,

and 50 shares of stock

$500 of debentures

general, corporate

for

Chicagq, 111.

pur¬

July 24 filed.
to be offered

writer—John

19

—T. Coleman Andrews.

Office

—

5001

West Broad St.,

Richmond, Va.
Mutual Investors Corp. of New York
May 17 (letter of notification) 295,000 shares of

stock (par 10 cents).

Price—$1 per share. Proceeds—To
acquire real estate properties and mortgages. Office—550
Fifth Ave., New York 36, N. Y. Underwriter — Stuart
Securities Corp., New York.

chase plans for accumulation of shares
terest.
Underwriter—Mutual

Distributors, Inc., Kansas

City, Mo.
Nassau Fund,

Princeton, N. J.

May 8 filed 250,000 shares of
market.

Proceeds—For

St., Princeton, N. J.

Hoisington, Inc.,

common

investment.

stock.

Underwriter—None.

Inc.;

and

for

Investment Advisor

same

—

working

Harland W.

share

Business—Tele¬
& Co.,

L. Aaron

New

Offering—Date indefinite.

\

Tax

1

Fund, Inc., New York

writer—None.

D. John Heyman of New York is Presi¬

if Rose Records, Inc.
July 22 (letter of notification)

11,022 shares of

common

Stillwater,

Corp., St. Louis, Mo.
1,250 shares of class C cumulative pre¬

(par $57). Price—$97 per share. Proceeds
Realty Co., who is the selling stockholder.
Underwriter — Yates, Heitner & Woods, St. Louis, Mo.
Offering—Expected in the near future.

ferred stock
—To R.

M.

the Yellowknife

St. Paul Fire & Marine Insurance Co.
offered

of

1.39

shares of

Western stock.

Insurance
St.

Co., Helena, Mont., at

stock for each share

Paul

of

The offer is condiitoned upon acceptance

by holders of not less than 240,000 shares (80%) of the
outstanding Western stock. Exchange Agent—First Na¬
tional Bank & Trust Co., Helena, Mont.

pected to be amended.

July

Sanders

14, 1956, filed $12,000,000 of 25-year sinking fund
debentures due Jan. 1, 1982. Price—To be
supplied by

Associates, Inc., Nashua, N.. H.
(8/6)
110,000 shares of class A common stock
(par $1) of which 100,000 shares are to be offered pub¬
licly and 10,000 shares are to be offered for subscription
by employees. Price — To be supplied by amendment.
Proceeds—To reduce bank loans and for working capital

amendment.

and

.

New

Brunswick

(Province

of)

Brunswick

Proceeds—To
Electric

Power

be

advanced

Commission

to

to

The

New

repay

bank

12 filed

other

corporate

Underwriter

purposes.

—

Kidder,

Northern States Power Co. (Minn.)
(8/13)
July 3 filed $18,000,000 of first mortgage bonds due Aug.
lr 1987. Proceeds—For construction program. Under¬
writer—To be determined by competitive
bidding. Prob¬




Sareze, Inc., Miami, Fla.
June 27 (letter of notification) 50,000 shares of 30-cent
cumulative convertible preferred stock
(par $2) and
50,000 shares of
in

units of

per

unit.

one

common

share

of

stock
each

(par $1)

to be

class of stock.

Proceeds—For working capital.

offered

Price—$5

Office—2621

Oil Corp., San Antonio, Texas

basis of tWo.mew shares for each

/.

s

:

share held. Price

supplied by amendment. Proceeds—To repay
Indebtedness, for acquisition and exploration of oil and
gas

be

wells, and for
Underwriter—None.

leases, for drilling and completion of

other

gorporate purposes.

Texas

Eastern

Corp.

Transmission

July 22 filed 1,000,000 shares, of common stock (par $7)
to be offered in exchange, on a share-for-share basis,
capital stock of La Gloria Oil & Gas Co. of Corpus
Christi, Texh/The offer is conditioned upon deposit of
at least 81% (810,000 shares) of outstanding La Gloria

for

stock

prior to Sept. 6, 1957. Offer may be extended from
beyond Dee. 5, 1957. Underwriter—
1 :;h V' hj.
//
■'/
■■
' J';

time to time but not

•

.

Texas Glass

Manufacturing Corp., Houston, Tex.

May 28 filed 2,116,292 shares of common

stock (par $1).

proceeds—For expansion and work¬
ing capital.' Underwriter—T. J.1 Campbell Investment
Co., Ipc,,, Houston; Texas.
;
/
price—$2 per share,

Thompson

Products,

(8/13)

Inc.

July 24 filed $19,729,500 subordinated debentures
Aug. 1, 1982 (convertible into common stock until
1,

1967). to

be

offered

for

by

subscription

due
Aug.

common

for each
Aug. 12. 1957; rights

stockholders in the ratio of $100 of debentures
14 shares of stock held of

to

expire

on

amendment.

record

Aug. 27, 1957.
Proceeds—For

on

Price

—

working

To be supplied by

capital^ and other

general corporate purposes. Underwriters—Smith, Bar¬
ney & Co., New .York; and McDonald & Co., Cleveland,
Ohio.

Peabody & Co., New York.

loans.

Underwriter—Halsey, Stuart & Co. Inc., New York
and Chicago. Offering—Indefinitely postponed.

a

<

shares of capital stock (par $6.25)
in exchange for the outstanding capital

properties; and for cost
of a concentration plant, mining equipment, etc. Under,
writer—Gearhart & Otis, Inc., New York. Statement ex¬

Dec.

Texam

None.

June 25 filed 417,000

be

Price—$25

May 29 filed 300,000 shares of common stock (par $1),
to be offered for subscription by common stockholders
—To

Office—705 South Husband St.,

March 27 filed

Inc., Washington, D. C.

40,000 shares of commoq. stpek.

shaie. Proceeds —For investment. Underwriter—
Equitable Securities Corp., Nashville, Tenr..

Underwriter—Richard B. Burns Securities Agency,

Okla.

rate

June 20 filed

on

stock. Price—At par ($1 per share). Proceeds—For work¬

ing capital.

/

Exempt Bond Fund,

per

Investment Advisor—Resource Fund Management

dent.

to

address.

Lithium

on

per

March 29 filed 100,000 shares of common stock (par $1).
Price—At market.
Proceeds—For investment.
Under¬

Nassau

Corp., New York
Feb. 19 filed 3,120,000 shares of common stock
(par one
cent). Price—$1.25 per share. Proceeds—For acquisi¬
tion of properties; for ore testing program; for assess¬
ment work

capital.

Underwriter—E.

stock of Western Life
National

Price—$5

Price—At

Office—10

by common stockholders

for. subscription

tions,

be offered to public and

St. Louis Insurance

pur¬
of beneficial in¬

1,165,750 shares of common stock (par $2)

Proceeds—To retire $125,000 of outstanding 15% deben¬
tures as well as a $173,180 debt to Trans-Union Produc¬

to

Stillwater;, Okla.

★ Mutual Trust, Kansas City, Mo.
July 26 filed (by amendment) $2,000,000 of periodic

.

one shqre for each option to purchase four shares of
Ogden common's.tock; unsubscribed shares"-to be offered
to certain employees and officers.
Price—$2 per share.
Proceeds—To pay outstanding obligations to. Ogden Corp.

are

Co., Inc., 60 Broadway, New York. N. Y.
common

i:.'/

v

of

200,000 shares

20,000 shares issued to underwriter.

Resource

50,000 shares of capital stock (par $1),
te be offered trustees of profit sharing retirement plans.
Price—At market. Proceeds—For investment. President

:

of

Inc., Richmond, Va.

filed

:

Ogden Corp. on the basis of one new share for each
four shares held and to holders of options on the basis,

Pyramid Productions, Inc., New York
Sept. 27, 1956, filed 220,000 shares of com. stock (par $1)

York.

Investment Trust for Profit Sharing-

/

if Syntex Corp. : ( Republic of Panama)

Office—2218 W. Lake St., Chicago, 111. Under¬
R. Boland & Co., Inc., New York.

poses.

Office—c/on Donald B."

cecds—For wQi'king capital,' etc.

pf common stock (par 20 cents) to be offered
of

Super Food Services, Inc.

July 22. (letter of notification) 55,000 shares of class A
stock (par $1) and 27,500 shares of class B stock (par
one cent)
to be offered in units of one class A share
and one-half class B share.
Price—$5.05 per-unit. Pro -

Precision

convertible

York,

derwriter—Kesselman & Co., Inc.j New

Under¬

Transformer Corp.
(8/2)
(letter of notification) $294,000 of 6%

Mandell Co., New York.

Joseph

—

12

Film Corp.

(John G.)

(letter of notification) 199,999 shares of com¬
mon stock
(par 25 cents). Price—$1.50 per share. Pro¬
ceeds—For
production of films, working capital, etc.
Office—113 West 57th St., New York.
Underwriter —
27

June

Plymouth Bond & Share Corp., Miami, Fla
Joseph A. Ray vis, also of Miami, is President.
June

of Fortune,

Fund

early in July.

i

investment.

.

Inc. and Fortune

to

Pancal Oil Corp.
May 13 (letter of notification) 299,000 shares of common
stock (par 10 cents).
Price—$1 per share. Proceeds—
For oil drilling expenses.
Office—27 William St., New
York, N. Y. Underwriter — Bush Securities Co., New
York, N. Y.

Price—At

N. J.

Inc., Fortune II, Inc., Fortune III,
IV, Inc. Underwriter — "William Allen
Steadman & Co., East Orange, N. J. Offering—Expected
of

for

Plymouth Fund, Inc., Miami, Fla.
Feb. 5 filed 500,000 shares of capital

Orange,

10 filed 100,000 shares of common stock (par $1)
be offered in connection with merger into this Fund

May

be
subscription by stockholders of record Aug.
28, 1.957 on the basis of one new share for each six shares
of common stock and/or preferied stock held; rights to
expire Sept. 30. Price—At par ($100 per share). Pro¬
ceeds—To repay advances from parent.
Underwriter—
None.
American
Telephone &
Telegraph
Co.
owns
90.54% of the voting stock of Pacific T. & T. Co. Offer¬
ing—Expected some time in August.
offered

'

Steadman Investment Fund, Inc.,

Halsey,

Bids—To be received at Room

•

1

Wulbern, Inc., Jacksonville,

Pierce, Carrison,

—

Fla.

Stuart & Co. Inc.; Morgan Stanley & Co.
2315, 195 Broadway, New
York, N. Y., up to 11:30 a.m. (EDT) on Aug. 20.
ders:

150,000 shares of com¬

(letter of notification)

25

writer

1, 1980. Proceeds-—To repay advances from American
Telephone & Telegraph Co., the parent. Underwriter—

vision releases.

Retirement Plans,

/

Fla.

stock

mon

of which

mill.

a

Jacksonville,

Corp.,

(par $1). Price—$2 per share. Proceeds—To
be added to the general funds of the company. Under¬

standing
stock

Industrial

June

$510 per unit, or $100 of debentures and 10 shares
stock at $102 per unit.
Proceeds — To repay out¬

common

'

-

Southern

ic Pacific Telephone & Telegraph Co. (8/20)
July 26 filed $90,000,000 of 23-year debentures due Aug.

of

A

(Edson B.) Fund, Boston, Mass.
(by amendment) 200,000 additional shares
Price—At market. Proceeds—For

July 30 filed

per

at

class

Y.

N.

1).

unit. Proceeds — For working capital
and other corporate purposes. Underwriter—None.
Price—$260

Philadelphia, Pa.
of

(Aug.

York,

New

Inc.,

Co.,

Plan, Inc., New York

if Smith

Seattle, Wash,
July 22 filed 15,825 shares of class A stock (par $10) and
3,165 shares of common stock (par $10) to be offered in
units of one common share and three class A shares.

units

Mines, Inc., Telluride, Colo.

&

,

,

Old American Life Co.,

in

June 24 filed 400,000 shares

of oil and gas properties.

For development

July 18 filed $4,000,000 of nine-month 8% funding notes.
Price—At par (in denominations oi $100 each;. Proceeds
—For working capital and
other corporate purposes.
Underwriter—Sire Plan Pprtlolios, Inc., New York.

Judge Bldg., Salt Lake City, Utah.

processing and selling of gravel. Office—203 Broadway,
Monticello, N. Y. Underwriter—Walnut Securities Corp.,
Mount Wilson

—

Offering—Expected today

ceeds—For development of oil and gas properties. Office
America

Tulsa, Okla.

(letter of notification) 275,000 shares of com¬
(par five cents). Price—75 cents per share.

Underwriter—Albert

stock.

—725

24

stock

Proceeds

(letter of notification) 2,500,000 shares of com¬
Price—At par (10 cents per share).
Pro¬

May 13
mon

Seminole Oil & Gas Corp.,

mon

Inc.

Ventures,

Miami, Fla. Underwriter—Floyd
Chicago, 111.
:%•*

Ave.,

Cerf, Jr. Co.,

June

Co., Inc. (jointly); Equitable Securities Corp.; Kuhn,
Loeb & Co.; Harnman Ripley & Co. Inc. Bids—Expected
to be received up to 10 a.m. (CDT) on Aug. 13.
&

Utah.

June 10

D.

Pierce, Fennel* and Beane, Kidder, Peabody & Co. and
White, Weld & Co. (jointly); Lehman Brothers and
Riter & Co. (jointly); Tne rir»t Boston Corp. and Blyth

Mid

Underwriter—None.

capital.

Northwest -2nd

Halsey, Stuart & Co. Inc.; Merrill Lynch,

bidders:

able

41

;

:

.

Titanic Oil Co.

May 6 (letter of notification) 6,000,000 shares of common
stock (par one cent). Price—Five cents per share. Pro¬
ceeds—For exploration of oil properties.
Office — 704
First National Bank Bldg., Denver, Colo. Underwriter—
Wayne Jewell Co., Denver, Colo.

Volume 186

Number 5660

...

The Commercial and Fi

Chronicle

(515)

Tripac Engineering Corp.
(letter of notification) 100,000 shares of class A

Feb. 27

common

stock

(par

10

cents).

Price—$l.ou per ciicue.
Proceeds—For working capital; machine
tools; equip¬
ment and
proprietary development.
Office — 4932 St.
Elmo Ave., Bethesda 14, Md.
Underwriter—Whitney &
Co., Inc., Washington, D. C.

Truly Kdlen Products,

Inc.

*

July 19 (letter of notification) 100,000 shares of common
stock (par 50 cents).
Price—$2 per share. Proceeds—
For plant and
laboratory expansion, advertising and
working capital. Office—6721 N. E. 4th Ave., Miami, Fla.
Underwriter—Alfred D. Laurence & Co., Miami, Fla.

Central

April 9 it

Illinois

Underwriter—To be

Stuart

Offering—Expected late in 1957.
Central Louisiana Electric
Co.,

April 8 it

Inc.
company plans to issue and
$6,000,000 of first mortgage bonds.
Together with $4,500,000 of 4%% 12-year

convertible

Uranium Corp. of
America, Portland, Ore.1
1,250,000 shares of common stock (par
cents). Price—To be supplied by amendment

placement of

"

late

this

.

—

year

debentures

bank

repay

announced

was

July 25 filed 200,000 shares of class A common stock (par
10 cents). Price—$9
per share. Proceeds—For expansion
and working
capital.
Underwriter—Bache & Co., New
York.
•
X
■"
-.v.. V-.V
//
-

loans

placed

and

for

about the

middle of

gage bonds.

share).;Proceeds—For exploration purposes.
Underwriter—To be named by amendment. Graham Al¬
bert Griswold of Portland,
Ore., is President;-x ,

Walter

(Jim) Corp., Tampa, Fla. *(8/12)
July 22 filed $1,250,000 of 9% subordinated bonds due
Dec. 31, 2000, and 50,000 shares of common•
^tock(par
50 cents) to be offered in units of
$25 principal-amount

v

of bonds and one

sharp of stock. Price—-$48.50" per unit.
Proceeds—For. working capital. Business—Construction

of "shell" homes.

Underwriters—Carl M, Loeb, Rhoades

& Co., New York;
Cleveland, Ohio.

and

Prescott,

Shepaid

&

Co.,

Inc.,

★ Wycotah Oil & Uranium, Inc., Denver, Colo.
July 29 filed, 375,000 shares of common stock (par $1).
Price—$4 per share. Proceeds—For acquisition of prop¬
erty and for other corporate purposes. .Underwriter —

construction

last year

Y"':Y.,;

Chesapeake
June

it

3

was

and

Un¬

program.

White, Weld &

arranged the private

issue of $5,000,000 series G first mort¬

an

10

(expected

to be $1 per

privately, to be used to

derwriters—Kidder, Peabody & Co.
Co.

.

April 30 filed

Consolidated

by competitive bidding.
Probable bidders:
& Co. Inc.; Salomon Bros. &
Hutzler;
Equitable Securities Corp.; Eastman
Dillon, Union Secu¬
rities & Co.; Blyth & Co., Inc.;
Kidder, Peabody & Co.;
and Merrill
Lynch, Pierce, Fenner & Beane (jointly);
Kuhn, Loeb & Co. and A. C. Allyn & Co., Inc.
(jointly).
Halsey,

Proceeds

-

Co.

determined

sell

..

Service

reported company plans to issue and sell
$10,000,000 of 1st mtge. bonds.Proceeds—To reduce bank
loans and for construction
program.

ic Two Guys From Harrison, Inc.,
Newark, N. J.
(8/19)
■
;
•

Public

was

'

•

/•,

"•

reported

plans early registra¬
tion of $3,500,000 of 51/2% collateral trust
sinking fund
bonds due 1972 and 350,000 shares of common stock.
Each
$10 of bonds will carry a warrant to purchase one share
of

stock.

common

company

Underwriter

Van

—

Alstyne, Noel &

Co., New York.

Chesapeake & Ohio Ry.
July 15 it was reported company plans to issue and sell
in August about
$5,000,000 of equipment trust certifi¬
cates.

★

Probable bidders:

Halsey, Stuart & Co. Inc.; Salo¬

July 30 it
sell

announced

was

plans

company

$30,000,000 of debentures.

to

issue

and

Proceeds—To repay

ad¬

.

Teden &

Co., Inc., New York.

,7;

..

.

Prospective Offerings
Airborne Instruments Laboratory, Inc. * o
May 16 it was announced company plans to issue and sell
$2,000,000 of 15-year 5%% unsecured subordinated con¬
vertible

debentures.. American Research & Develop¬
Corp., owner of 31,500 shares or 15.8%,-of Airborne's stock, propose to purchase
$320,000 of the new
debentures.
Proceeds—Together with $4,000,000 to be
ment

borrowed from institutional investors, for a
building and

expansion-program.
Aircraft,

'..

;

Inc.

Podesta & Co., Chicago, 111.

warrants).

Proceeds—Together wrth funds from

private sale of 425,000 shares of common stock; at $4 per
share to pay part of cost of purchase of an
operating car¬
rier truck.line.

Underwriter—Fulton, Reid & .Co., Inc.,
Cleveland, ^.
Ohio.
Y*,.»Y >
Y
"
Y •Y
*

•.

.

.

*

-

.

*

•.
'

*

Aluminum Specialty Co.
sell

15,000

was

Y

Cincinnati

July

it

15

&

Suburban Telephone Co.

reported

was

company

(9/3)
plans to offer to its

stockholders of record Aug. 27, 1957, the
privilege of
subscribing for additional common stock on a l-for-10
basis; rights to expire on Oct. 3, 1957. Underwriter—
None. American Telephone & Telegraph Co. owns
ap¬
proximately 30% of the outstanding common stock.
Cleveland

Electric

Illuminating Co.

-

Weld

&

Co.

(jointly);

Glore,

Forgan

&

Co.;

White,

& Co.

Coastal

Transmission Corp.
July 1 it was reported the company plans to offer pub¬
licly about 191,000 units of securities for about $20,000,000 (each unit
expected to consist of a $25 debenture or

$35

interim

stock).

note

and

five

shares

of

$1

par

common

Proceeds—Together with other funds, for

con¬

struction program.

announced company plans to issue and
of $1.20, cumulative convertible pre¬

shares

was reported company plans to issue and sell
$25,000,000 of first mortgage bonds in the Summer of
1957. Proceeds—To repay bank loans and for construc¬
tion program. Underwriter—To be determined
by com¬
petitive bidding.
Probable bidders:
Halsey, Stuart &
Co. Inc.; The First Boston
Corp.; Blyth & Co., Inc.; Dil¬
lon, Read & Co. Inc.; Blair & Co. Inc;: and Baxter, Wil¬

liams

Freight, incorporated, Akron, O.

June 21 it was announced company plans to
offpr public¬
ly $2,250,000 of 15-year 6% debentures (with 'common

March 18 -it

American

Nov. 12 it

,

stock

Inc.

.

July 9 it ,-^as reported company plans to issue and sell
up to $12,5.00,000 common stock, following
spin-off by
California Eastern Aviation, Inc. ; of
jts \ subsidiaries,
Land-Air, Inc. and Air Carrier Service Corp.. into Air¬
craft, Inc., a new company.
Underwriter—Uruttenden,
All States

from

vances

Telephone & Telegraph Co., the
parent. Underwriter—To be determined by competitive
bidding. Probable bidders: HaJsey, Stuart & Co. Inc.;
White, Weld & Co.; Morgan Stanley & Co.; Kuhn, Loeb
& Co.; The First Boston
Corp.; Harriman Ripley & Co.

~v-7' Y-.<

Allen &

,

Underwriters—Lehman Brothers and
Co., both of New York.

Columbia Gas System, Inc.

(10/3)
6, company announced that it plans the issuance
sale of $25,000,000 debentures later in 1957.
Pro¬

ferred stock series A
(pap $20). Underwriters—Emch &
Co. and. The" Marshall
Co., both of Miiw'aukpe. Vyis.

June

American Telephone & Telegraph Go. (10/29)
July 17 it.was announced that company^ plans to issue

ceeds—To help finance 1957 construction
program, which
is expected to cost
approximately $84,000,000. Under¬

.

and

sell

$250,000,000 of debentures to be dated Nov. 1,
mature, on Noy. 1, 1983.' Proceeds—For im¬

and

bonds

writer—To be determined by competitive
bidding. Prob¬
Halsey, Stuart & Co. Inc.; Morgan Stanley

1957 and4o

and expansion/of system. Underwriter—To
determined by competitive bidding. Probable, bidders:
Morgan Stanley & Co.; The First Boston Corp. and Halsey, Stuart & Co. Inc. (jointly).. Bids—Expected to be

&

be

pay part of the cost of the

company's 1957 construction
which is expected to total about $146,000,000.
Underwriter—To be determined by competitive bidding.
Probable bidders: Halsey, Stuart & Co.
Inc.; Morgan
Stanley & Co.; The First Boston Corp. Bids—Tentatively
program

scheduled to be received up to 11 a.m.
(EDT) on Oct. 22.
•

opened

Oct. 29.

on

/

'

7, V,

.//

•;

Y Atlantic City Electric Co.
April 9, Bayard L. England, President, announced that
later this

year the company will probably issue about
$5,000,000 of convertible debentures. Proceeds—For con¬

struction program. Underwriter—May be determined
by
competitive bidding. Probable bidders: Halsey, Stuart &
Co.. Inc.; Kuhri, Loeb & Co., American Securities
Corp.
and Wood, Struthers & Co.
(jointly); White, Weld & Co.
and Shields & Co.

(jointly); The First Boston Corp. and
(jointly); Eastman Dillon, Union Securi¬
Smith, Barney & Co. (jointly); Lee Higginson Corp.; Blyth & Co., Inc.
■
,
-

Drexel

&

Co.

ties & Co. and

•

.

.

class

& Rubber Co. in 1956.

Underwriter—Dillon, Read & Co.,
Inc., New York, handled previous preferred stock financ¬
ing, while Kidder, Pea body & Co. underwrote General
Tire

&

Rubber Co.

Central

April 22 it
sell

financing.

Hudson Gas
was

&

Electric
company

year, probably in the fall,
500.000 of sinking fund debentures.
program.




■

term

bank

loans.

Under¬

writer—Dillon, Read & Co. Inc., New York.
Commerce Oil Refining Co.
June 10 it was reported this company plans to raise
about $64,000,000 to finance construction on a proposed
refinery and for other corporate purposes. The major

portion will consist of first mortgage bonds which would
be placed privately, and the remainder will include de¬
bentures and

common

stock

(attached

or

in units). Un.

Edison

Co.

(10/8)

June 25 company stated that it plans to offer
$25,000,000
to $50,000,000, of new securities (kind not
yet deter¬

mined). Proceeds

For construction

—

Under¬
be The Firsl

program.,

writer—(1)
Boston

For any preferred stock, may
Corp. and Glore, Forgan & Co. (jointly).

(2)
For any bonds, to be determined by
competitive bididng.
Probably bidders: Halsey, Stuart & Co. Inc.; The First
Boston Corp.; Glore, Forgan & Co. Bids — Expected to
be

received

on

Oct.

8.

Corp.
plans to issue and

than

approximately $7,-

Underwriter—Probably

Peabody & Co.,'New York.

short

Connecticut Light & Power Co.
Feb. 18, it was reported company plans to

Proceeds—To finance

construction

reduce

Co.

(9/17)

plans to issue and sell

the

First

•

Boston

Corp.

to 11:30

up

Consumer Power Co.

(jointly.

a.m.

Bids—Ex¬

(EDT)

on

Sept. 17.

(9/23)

July 9 it was announced company plans to issue and sell
$35,000,000 of first mortgage bonds due 1987. Proceeds
—To

repay bank loans and for construction program.
Underwriter—To be determined by competitive
bidding.

Probable bidders: Halsey, Stuart & Co. Inc.;
White, Weld
Co. and Shields & Co. (jointly); Morgan
Stanley &

&

Co.; The First Boston Corp. and Harriman Ripley & Co.
Bids—Expected to be received up to 11:30
(EDT) on Sept. 23.

Inc. (jointly).
a.m.

Power Co.

(10/16)

announced that the company plans, in addi¬
tion to the bond financing, to offer to its common stock-2*
holders the right to subscribe for $35,156,760 convertible
was

debentures
the

basis

stock

maturing not earlier than Sept. 1, 1972, on
$100 of debentures for each 25 shares of

of

held.

Proceeds—For

derwriter—To

be

construction

Un¬

program.

determined

by competitive bidding.
Probable bidders: Halsey, Stuart & Co. Inc.;
White, Weld
& Co. and Shields & Co (jointly);
Morgan

Stanley &

Co.; The First Boston Corp. and Harriman Ripley & Co.
Inc. (jointly); Ladenburg, Thalman & Co.
Bids—Expect¬
ed to be received up to noon (EDT) on Oct. 16.
Cook Electric Co.

July 15 it was reported that company is planning some
equity financing. Underwriter—Probably Blunt Ellis &
Simmons, Chicago, 111.
*
Detroit

Edison

Co.

June 27 company announced Michigan P. U. Commission
has authorized issue and sale of

$70,000,000 general and

refunding mortgage bonds, series P, due 1987.
—To

bank

repay

Underwriter

loans

If

and

for

construction

Proceeds
program.

determined

by competitive bidding,
probable bidders may be The First Boston Corp. and
Halsey, Stuart & Co. Inc. (jointly); Coffin & Burr, Inc.,
and Spencer Trask & Co. (jointly).
Offering—Expected
in August.
'
—

Duke Power Co. (9/10)
April 22 it was reported company plans to issue and sell'
$50,000,000 of first refunding mortgage bonds. Proceeds
—To repay bank loans and for new construction. Under¬
writer—To be determined

by competitive bidding. Prob¬
Halsey, Stuart & Co. Inc.; The First Bos¬
Morgan Stanley & Co.; Stone & Webster
Securities Corp. Bids—Tentatively scheduled to be re¬
ceived on Sept. 10.
/
\
able bidders:
ton

Corp.;

_

Eastern Gas & Fuel Associates

April 3 it was announced company may need additional
capital of between $25,000,000 and $35,000,000 during th#*
next two years. Underwriter—For any bonds to be de¬
termined
by competitive bidding. Probable bidders:

Halsey, Stuart & Co. Inc.; Blyth & Co., Inc.; White, Weld
Co., and Kidder, Peabody & Co. (jointly).

&

Eastern Utilities Associates

April

it

15

sell

announced

was

$3,750,000
For

of

company

25-year

advances to

proposes

collateral

to

trust

issue

bonds.

Blackstone

Valley Gas &
Co., a subsidiary. Underwriter—To be deters
by competitive bidding. Probable bidders: Hal¬
Stuart & Co. Inc.; Kidder, Peabody & Co.; Blyth
—

mined
sey,

&

Co., Inc.; White, Weld & Co.; Stone & Webster Se¬
Estabrook & Co. (jointly).

curities Corp. and

El Paso Natural Gas Co.
(8/27)
'July 17 directors authorized filing early in August of
a registration statement with the SEC covering the
pro¬
posed issue and sale of $60,000,000 convertible deben¬
tures and $10,000,000 first preferred stock. It is planned
to offer the debentures for subscription by common and
common B stockholders of record Aug. 26, 1957.
Price—
To be determined later. Proceeds—Together with funds
from private sale of $60,000,000 first mortgage pipe line
bonds, for current expansion program. Underwriter-^
White, Weld & Co., New York.

Employers Group Associates
July 1 it
tration

issuance

capital
holders

was

announced company plans to file a regis¬

statement with
and

stock

sale

to

the

on

shares held.

of

the

up

to

SEC

be offered for
basis

of

covering the

88,761

one

additional

proposed

shares of

subscription by stock¬

new

share for

each

four

Price—To be supplied by amendment. Pro¬

ceeds—For

working capital and general corporate pur¬
Underwriter—Morgan Stanley & Co., New York.
Offering—Expected in late August or early September.
poses.

announced

this

July 22 company announced it is planning to sell publicly
in October an issue of
$8,000,000 par amount of cumula¬
tive preferred
stock.
Price—To be determined
later.
Proceeds—To

Gas

Electric

Columbus & Southern Ohio Electric Co.

Commonwealth

of

and

Proceeds

3.

derwriter—Lehman Brothers, New York.

a proposal to authorize a
100,000 shares of cumulative preference
stock
(par $100) and to increase the authorized out¬
standing indebtedness to $15,000,000, in connection with
its proposed recapitalization
plan. There are no specific
objectives involved. Control—Acquired by General Tire
new

Co.

ceived

Oct.

Natural

was announced company

$30,000,000 debentures due 1982. Underwriter—To be de¬
termined by competitive
bidding.
Probable bidders:
Halsey, Stuart & Co. Inc.; White, Weld & Co. and Paine,
Webber, Jackson and Curtis (jointly); Morgan, Stanley

and

.

Byers (A. M.) Co.
May 7 stockholders approved

Consolidated

July 22 it

Co.; Merrill Lynch, Pierce, Fenner & Beane and
White, Weld & Co. (jointly). Bids—Expected to be re¬
on

r

a
30-year maturity).
This may
$60,000,000, depending upon market con¬
Proceeds—From this issue and bank loans, to

ditions.

able bidders:

provement

Inc.

(probably with

July 9 it

of

York,

be increased to

Consumers

Chesapeake & Potomac Telephone Co.
Baltimore City
V

New

that the company has tentatively decided to
issue and sell
$50,000,000 of first and refunding mortgage

Bros. & Hutzler.

mon

of

announced

pected to be received

Industries, Inc.

Co.

(10/22)
Charles B. Delafield, Financial Vice-President, on July 8

&

'

Edison

43

.

Kidder,
£

$20,000,000

Fall, depending
construction

of

first

upon

mortgage

sell not less
bonds, possibly this

market conditions.

Proceeds—Foi

program.
Underwriter — Putnam & Co.,
Hartford, Conn.; Chas. W. Scranton & Co., New Haven,
Conn.; and Estabrook & Co., Boston, Mass.

General

Telephone Co. of California
announced that the company has been
granted authority by the California P. U. Commission to
issue and sell 500,000 shares of 5% cumulative preferred
July

10

it

was

Continued

on

page

44

Financial Chronicle... Thursday, August 1, 1957

The Commercial and
44

(516)

Louisville

43

Continued from page

*

(par $20). Proceeds — For construction program.
Underwriters—Paine, Webber, Jackson & Curtis, Boston,

stock

Templeton, Los Angeles,

Mass.; and Mitchum, Jones &
Calif.
Tire

General

Rubber Co.

&

was

Chicago, III.
announced company plans to issue and

Goodman Manufacturing Co.,
June 21

it

was

150,000 shares of capital stock (par $16.66%), fol¬
lowing approval on Aug. 5 of 3-for-l split up of present
$50 par stock. Proceeds—For general corporate purposes.
sell

Gulf

announced company plans to issue some
additional first mortgage bonds, the amount of which has

May 3 it

was

For construction
program.
Underwriters—Carl M. Loeb, Rhoades & Co.
and Merrill Lynch, Pierce, Fenner & Beane.
not yet

been determined.

of

equipment trust certificates. Probable bidders:
Stuart & Co. Inc.; Salomon Bros. &

sey,

expected

of

bentures

due

Proceeds

—

March

it

4

Utilities Co.

reported

was

plans

company

eell $16,000,000 first mortgage bonds in
ceeds.—To

November. Pro¬

determined by competitive
Halsey, Stuart & Co. Inc.;
Merrill Lynch, Pierce, Fenner and Beane and White,
Weld & Co. (jointly); Salomon Bros. & Hutzler and
Eastman Dillon, Union Securities & Co. (jointly); Kuhn,
Loeb & Co. and A. C. Allyn & Co. Inc. (jointly); Stone
& Webster Securities Corp.; Lee Higginson Corp.
Underwriter—To be
bidding.
Probable bidders:

Gulf States Utilities Co.

April 8 it

be

construction

determined

ders:

bidding. Probable bid¬

competitive

by

Securities

& Webster

Stone

tentatively plans to

company

preferred stock this year. Proceeds
program.
Underwriter—To

some

finance

—To

reported

was

.issue and sell

Corp.; Lehman Bro¬

thers and Equitable Securities Corp.

(jointly); Lee Hig¬
ginson Corp. and Carl M. Loeb, Rhoades & Co. (jointly);
Kuhn, Loeb & Co.; Glore, Forgan & Co. and W. C. Langley & Co. (jointly).
Hathaway
June 24 it
to

its

announced

common

stock.

Co., Waterville, Me.
company plans soon to offer

(C. F.)

was

stockholders

additional

some

common

Underwriter—Probably H. M. Payson & Co., Port¬

land, Me.
Houston
Feb.

13

it

Lighting & Power Co.

offer late this
Fall approximately $25,000,000 first mortgage bonds, but
exact amount, timing, etc. has not yet been determined.
Underwriter—To be determined by competitive bidding.
Probable

reported

was

bidders:

^Securities

may

company

Lehman

Brothers,

Eastman

Dillon,

Utilities, Inc.

16 it

was

196,851 additional shares of common stock (par $1), plus
purchase an additional 196,581 shares, on the
of one new common share and one warrant for

Co.

Salomon

and

Bros.

&

Hutzler

Power

determined

by

Co.

each

seven

will

the fifth

May

day following the effective date

bidding, probable bidders;
(1) For bonds—Halsey, Stuart & Co. Inc.; Salomon Bros.

& Hutzler and Eastman

Dillon, Union Securities & Co.

(jointly); Blyth & Co. Inc., Lazard Freres & Co. and
First Boston Corp. (jointly); Kidder, Peabody &
Co. and White, Weld & Co. (jointly); Equitable Securities Corp. (2) For stock—Kidder, Peabody & Co.; Blyth
& Co., Inc., and Lazard Freres & Co. (jointly).
The

was

of

bank

loans

and

for

announced company plans sale of $40,000,additional bonds to mature in 1987. Proceeds—For

000

construction

—Expected to be received on Sept. 12.
•

Public Service Co. of Indiana,

construction.

Loeb

$30,000,000 first mortgage bonds will be issued
Proceeds—To repay bank loans
(amounting to $25,000,000 at Dec. 31, 1956) and for new

received
•

was

Bell Telephone Co.

(9/11)

announced company plans to issue and

struction.

sell

tive

bidders:

Jan. 14 it

Southern

July 23 it
sell

ders:

(jointly); Kidder, Peabodv &
Goldman, Sachs & Co. (jointly); Harriman Rip¬
ley & Co. Inc.; Lehman Brothers and Blyth & Co., Inc.
(jointly); The First Boston Corp.; Eastman Dillon, Union
Securities & Co. and White, Weld & Co. (jointly). Bids
Co. and




•

■

i

on

For

t '

'

.

i

,

'I

,

Stuart & Co. Inc.; The First;

(jointly); Blyth 8c
Bids—Expected to be re¬

plans to issue and sell

of debentures this summer. Proceeds—

Underwriter—May be Blair
Incorporated, New York.
program.

Southwestern Bell Telephone Co.

Underwriter—To

(10/1)

be

determined

by

competitive

bid¬

Probable bidders: Halsey, Stuart & Co. Inc.;
Morgan Stanley & Co. Bids — Tentatively expected to
ding.

(11/19)

,

Halsey,

May 24 directors approved the issuance of $100,000,000
new
debentures.
Proceeds — For expansion program.

be

and

f

bonds,

and Dean Witter & Co.

construction

& Co.

Under¬

.

f

►

.

-

t

-L

I

received

on

Oct.

1.

Die Co.
announced company plans to issue and
sell
150,000 shares of 70-cent cumulative convertible
preferred stock (par $10). Price—Expected to be be¬
tween $11.12V2 and $11.50 per share, depending upon mar¬
ket conditions. Proceeds—To discharge a note of $1,160,500 held by City Industrial Co. in connection with ac¬
quisition of Bethlehem Foundry & Machine Co. common
it Superior Tool &

July 26

(1) For bonds—Halsey, Stuart & Co. Inc.; The First Bos¬
Corp.; Blyth & Co., Inc.; Eastman Dillon, Union Se¬
& Co. and Salomon Bros. & Hutzler (jointly).
(2) For preferred stock—Eastman Dillon, Union Securi¬
ties & Co. and Salomon Bros. & Hutzler (jointly); Harri-

"

bidders:

about $10,000,000

ton

'

;

(8/27)

Southern Union Gas Co.

curities

Sept. 4.

Co.

announced company plans to issue and

May 16 it was reported company

70,000

American Securities Corp.

—Tentatively scheduled to bp received

announced that it is planning to

was reported that this company now plans to
sell $28,000,000 of first mortgage bonds and
shares of $100 par value preferred stock. Pro¬
ceeds—To repay bank loans.
Underwriter—To be de¬
termined
by competitive bidding.
Probable bidders:

issue

Edison

Co., Inc.; Kuhn, Loeb & Co.
ceived on Aug. 27.

May 15 it

Underwriter—

was

Boston Corp.

determined by competitive
bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
The First Boston Corp.; Glore, Forgan & Co.; Blyth &
Co., Inc. Bids—Expected to be received on Sept." 25.

competitive bidding. Probable bid¬
Halsey, Stuart & Co. Inc.; Kuhn, Loeb & Co. and

California

$40,000,000 of first and refunding mortgage

Probable

writer—For any bonds, to be

Co.

;

v

series J, due 1982. Proceeds—For construction program.
Underwriter—To be determined by competitive bidding.

posed financing, but no consideration is being given to
sale of common stock or securities convertible into com¬

Power

;

reported company plans to issue and sell

pected to be received until next Fall.

$8,000,000 and $10,000,000 early this fall.
No decision has been made as to the form of the pro¬

Ohio

was

•

Co.

Halsey, Stuart & Co. Inc.; The First Boston Corp. and
Lehman Brothers
(jointly); Kidder, Peabody & Co.;
Eastman Dillon, Union Securities & Co. Bids—Not ex¬

(9/25)

Proceeds—For construction program.

stock. Underwriter

Angeles, Calif.

$10,000,000 of first mortgage bonds. Underwriter—To be
determined by competitive bidding. Probable bidders:

between

stock.

October of this year a maximum of

South Carolina Electric & Gas

$4,260,000 equipment trust certificates. Probable bid¬
ders: Halsey, Stuart & Co. Inc.; Salomon Bros. & Hutzler.
company

Aug. 28.

200,000 additional shares of common

Ry. (9/18)
Bids are expected to be received by the company up to
noon
(EDT) on Sept. 18 for the purchase from it of

this

& Co.

Halsey,..Stuart

Diego Gas & Electric Co.

—William R. Staats & Co., Los

Norfolk & Western

1

on

sell in September or

bidders: Halsey, Stuart & Co. Inc.; The First
Corp.; Morgan Stanley & Co.; Kuhn, Loeb & Co.
and Eastman Dillon, Union Securities & Co. (jointly).

Illinois Gas Co.

bidders:

Co., Inc., San Francisco, Calif.

Boston

Northern

Probable

.

Probable

July

bank loans and for construction program.

reported company plans to issue and sell
and refunding mortgage/bonds due
repay bank loans and for new con¬
Underwriter—To be determined-by competi¬

Siegler Corp.
June 25 it was announced company plans to issue and

Niagara Mohawk Power Corp.
April 22 it was reported company tentatively plans to
issue and sell this fall about $40,000,000 of bonds.
Un¬
derwriter—To be determined by competitive bidding.

To be determined by

-

April 23, E. D. Shcrwin, President, announced that com¬
pany will probably raise about $7,500,000 late this fall
through the sale of preferred stock. Underwriter—Blyth

Dillon, Union Securities & Co. and White, Weld
& Co. (jointly); Equitable Securities Corp.; The First
Boston Corp.; Merrill Lynch. Pierce. Fenner & Beane.

(9/4)

•

(8/28)

First

The

San

&

Long Island Lighting Co.
April 16 it was announced company plans to sell later
this year $40,000,000 of rist mortgage bonds, series J.
Proceeds—To refund $12,000,000 of series C bonds due
Jan. 1, 1958 and for construction program. Underwriter
—To be determined by competitive bidding. Probable

Co.

/ '.:"V1

& Gas Co/

was

bidding.

ceived

Eastman

May 14 it was reported company plans to issue and sell
$15,000,000 of first mortgage bonds. Proceeds—To repay

;/

Electric

Boston Corp.;, Kuhn, Loeb. & Co. and
Lehman Brothers (jointly).
Bids—Expected to be re¬
Inc.;

Light Co.
Sept. 12, 1956, it was announced company plans to issue,
and sell $5,000,000 of first mortgage bonds. Underwriter—
To be determined by competitive bidding.
Probable
bidders: Halsey, Stuart & Co.; Kuhn, Loeb & Co., Leh¬
man Brothers and Salomon Bros. & Hutzler
(jointly);.

mon

Oct. 9.

Service

Proceeds—To

1987.

New Jersey Power &

Stuart & Co. Inc.; The First Boston
Corp. and Blyth & Co. Inc. (jointly); W. C. Langley &
Co. and Smith, Barney & Co. (jointly).

com¬

$60,000,000 of first

May 1 it

Halsey,

on

Public

July 19 it

$30,000,000 of debentures.

raise

by

Probable bidders: Halsey, Stuart & Co.

Inc.; Blyth & Co., Inc.; The First Boston Corp.: Harri¬
man Ripley & Co. Inc.; Glore, Forgan & Co.; Kuhn, Loeb
& Co., Salomon Bros. & Hutzler and Eastman Dillon,
Union Securities 8c Co. (jointly)/Bids—Expected to be

&

New Jersey

•

be determined

Underwriter—To

petitive bidding.

1957.

construction

was

series of

company.

Company; Salomon Bros. & Hutzler; Eastman
Dillon, Union Securities & Co., and Wood, Struthers &
Co. (jointly); Lehman Brothers; The First Boston Corp.;
Equitable Securities Corp.; Merrill Lynch, Pierce, Fen¬
ner & Beane; Kidder, Peabody & Co., and White, Weld
& Co.
(jointly). Offering—Expected in first half oi

Proceeds—For expansion program.

Electric

(10/9)

Inc.

announced that it is expected that a new

to be known as Marrimack-Essex Electric Co.
Underwriter—May be determined by competitive bid¬
ding. Probable bidders: Halsey, Stuart & Co. Inc.; Kuhn.

one

pany,

Lake Sulphur Co.
27, 3956, Eugene H. Walte, Jr., announced company
plans in the near future to sell an issue of convertible

&

Underwriter—To be. determined

and sold by the company.

Jefferson

Gas

program.

by competitive bidding. Probable bidders: Halsey, Stuart
& Co. Inc.; White, Weld & Co.; The First Boston Corp.;
Morgan Stanley & Co. and Drexel & Co. (jointly). Bids

This would be followed by a $20,000,000 first mortgage bond issue by the resultant com¬

into

.Dec.

Louisville

was

July 29 it

15.

-debentures.

(9/12)

Philadelphia Electric Co.

July 22 it

bidders:

Co.; Lowell Electric Light Corp.; Lawrence Electric Co.;
Haverhill Electric Co. and Amesbury Electric Light Co.,

Underwriter—To be determined by competi¬
tive bidding.
Probable bidders: Halsey, Stuart & Co.
Inc.; Harriman Ripley & Co. Inc.; The First Boston
Corp.; Eastman Dillon, Union Securities & Co. Bids—
Tentatively expected to be received up to 11 a.m. (EST)
Oct.

$9,300,000 from parent, and the remaining $16,000,000
new construction.
Underwriter — Glore, Forgan &

Co., New York.

New England Electric System
May 23 it was announced SEC has approved the merger
of the five following subsidiaries: Essex County Electric

program.

on

new

for

Halsey, Stuart & Co. Inc.; Eastman
Dillon, Union Securities & Co.; White, Weld & Co.; Kid¬
der, Peabody & Co.; Smith, Barney & Co., and Blyth &
Co., Inc. (jointly); Merrill Lynch, Pierce, Fenner &
Beane and Stone & Webster Securities Corp. (jointly).

Michigan Electric Co. (10/15)
May 20 it was reported company plans to issue and sell
.$20,000,000 of first mortgage bonds due 1987. Proceeds
reduction

Gas

of

Power Co.

reported company may issue and sell in
$20,000,000 of debt securities. Proceeds—
For construction program and to reduce bank loans.
Underwriter—To be determined by competitive bidding.

Indiana &

—For

company, a subsidiary of
Co., may issue about $25,300,000

announced

securities, in the following form: $15,000,000 of
mortgage bonds, $3,700,000 of preferred stock and $6,600,000 of common stock. Proceeds—To repay advances

the fall about

Probable

was

of

program.
writer—None.

Montana

it

Northern Natural

with the SEC. Proceeds—For expansion
Office—Grant Bldg., Pittsburgh, Pa. Under¬

May 20 it

20

Pipe Line Co.

Basin

Permian

The holders of record

shares presently held.

be

of registration

Underwriter—To be

1.

competitive

Harriman Ripley &

ties Corp.; The First Boston Corp.;
Co. Inc.; Kuhn, Loeb & Co.

warrants to

basis

to be received on Sept. 11.

&

13.

Electric Co.
Sept. 12, 1956 it was announced company plans to issue
and sell $6,000,000 of first mortgage bonds. Underwriter
—To be determined by competitive bidding.
Probable
bidders: Halsey, Stuart & Co. inc.; Merrill Lynch, Pierce,
Fenner & Beane, Eastman Dillon, Union Securities &
Co. and White, Weld & Co. (jointly); Equitable Securi¬
Pennsylvania

announced company plans to offer its
the right to subscribe for about

first mortgage bonds after Nov.

Idaho

i

be received on Sept.

stockholders

May 16 it was reported company plans to issue and sell
around 200,000 to 225,000 shares of common stock in the
Fall in addition to between $10,000,000 to $15,000,000

Securities

(jointly); Lazard Freres & Co. and Blyth & Co., inc.
(jointly); Kidder, Peabody & Co.

H

Underwriter—To be determined by competitive
Probable bidders: Halsey, Stuart & Co. Inc.;
Eastman Dillon, Union Securities & Co. and Kidder, Pea¬
body & Co.
(jointly); Lehman Brothers and Bear,
Stearns & Co. (jointly); Blyth & Co., Inc. .and White,
Weld
& Co. (jointly).
Bids—Tentatively expected to

Proceeds—Together with pro¬
ceeds from sale of 900,000 shares of common stock (par
$100) to parent, American Telephone & Telegraph' Co;;
will be used to pay for expansion program. Underwriter
—To be determined by competitive bidding. Probable
bidders: Halsey, Stuart & Co. Inc.; Kuhn, Loeb & Co.;
Morgan Stanley & Co.; Shields & Co.; White, Weld &
Co.; The First Boston Corp. Bids—Tentatively expected

Union

(9/18)

Light Co.

bidding.

Molybdenum Corp. of America
common

&

Power

gram.

1972.

underwriting, with oversubscription privileges.

Halsey, Stuart & Co. Inc.; Equitable

Corp.;

statement is

issue of $3,000,000 of convertible de¬
Underwriter—Lee Higginson Corp.,

an

Middle South

gram.

*

Pacific

July 19 it was reported that company plans to issue and
sell $20,000,000 of first mortgage bonds due 1987. Pro¬
ceeds—To repay bank loans and for construction pro¬

for construction pro¬

bank loans and

repay

issue and

to

Hal¬

Hutzler.

May 8 it was announced company may consider an offer¬
ing of new common stock within the next year or so.
Proceeds—About $19,000,000, for investment in common
stocks of the System operating companies during the
three-year period 1957, 1958 and 1959.
Underwriter—
Previous stock offering was to stockholders, without

date

Gulf States

Corp.

York.

New

July

Co.

Gas

Interstate

Ripley & Co. Inc. and Stone & Webster Securities
(jointly); The First Boston Corp.; Blyth & Co.,
Inc.; Kuhn, Loeb & Co.; Lehman Brothers. Bids—Ex¬
pected to be received up to 11 a.m. (EST) on Nov. 19.

man

RR.

are

Mangel Stores Corp.
June 19 it was reported early registration

announced that this company is consider¬
ing an issue of $15,000,000 to $20,000,000 convertible sub¬
ordinated debentures (with stock purchase warrants at¬
tached ) which may first be offered for subscription by
common
stockholders.
Proceeds—For working capital.
Underwriter—Kidder, Peabody & Co., New York. Offer¬
ing-—Expected in the next few months.

May 10 it

Nashville

&

expected to be received by the company some
time in the Fall for the purchase from it of $14,400,000

Bids

.

it

was

Number 5660

Volume 186

The Commercial and Financial Chronicle

...

r

(517)
stock and for

working" capital and general corporate pur¬
Underwriter—Van Alstyne, Noel & Co., New York.

poses.

Transocean

May 21 it

ly); Lehman Brothers; Blyth & Co., Inc. Bids—Tenta¬
tively scheduled to be received on Sept. 24.

Corp. of California

April

Light Co.

(9/24)

announced company

was

plans to issue and

—

Underwriter—To be determined by competi¬
bidding. Probable bidders: Halsey, Stuart & Cc
Inc.; The First Boston Corp. and Blyth & Co., Inc
(jointly); Salomon Bros. & Hutzler; Eastman Dillon,
Union Securities & Co. and Smith, Barney & Co. (joint¬
ly); Lehman Brothers and Bear, Stearns & Co. (jointly);
White, Weld & Co. and Stone & Webster Securities Corp
(jointly); Kidder, Peabody & Co. Bids — Tentatively

Offering—Expected

securities

new

tive

April 15 it

scheduled to be received

Sept. 24.

on

mentioned in

Associates
the

its

latter

Gas

Co.,

parent)

the

it

this

to

to

Blackstone properties.

Power

&

Light Co.

Valley

payment

part

of

March

the

public 400,000 shares of common stock. Under¬
writer—To be determined by competitive bidding. Prob¬
able bidders: Kidder, Peabody & Co. and Merrill Lynch,
Pierce, Fenner & Beane
(jointly); Eastman Dillon,
Union Securities & Co. and Smith, Barney & Co. (joint¬

manding

S

bonds

Loeb

certaiL

Dealer-Manager—May be Kidder

&

Salomon

rities

&

Weld

&

was

on

of

preferred

hope of profiting

by

outside

New

reportedly
With

only two or three corofferings in prospect next
week, the largest piece of business
in
sight
is
the
projected
offering by J. Ray McDermott &

the

to

bottom

trough
uougn

the

of

which
wnicn

about

vertible

to have moved just about

appears

this

devolalone
develops
along

time

every

are

due

th^t

hliain<SQ„

on

current

week
brought
only
a
smattering of offerings and the
period ahead promises little more,
if as much.
< "

Tuesday

the close

Rioht«

h-w

will

La fhp oSrinTk

?rnf/ld

being underwritten.
The following day will bring
public offering, via the negotiated
i'C

investment

But
their
will

be

not

°f an issue of $6 million

route»

and

bankers

distributing
keenly

for

at

the

is.

lines

along

that

the

to

seems

that

present

term

se-

curities market as an unusual opportunity. This is the view of a
bond man just back from a swing
around the eastern half of the
country.

"e f<""ul real interest in the
the

current

these

trend

Securities

of

cor-

..

,

Meanwhile, it was reporlted that
pre-oifering inquiry for the Associates Investment Co. s new deKontnuoe

Kl'iclr

unnoot'Ofl

issues

included

in

the

overall

comparable to total costs
of registered issues because cor¬

of

median

fee

compensation

at

electric,

and

gas

other

D.

found" to!

se¬

(f

curities which appears to be ahead

helped by heavier composition of small issues and

com-

expenses

lowwere

water

to
m

lower
the

rates

utilities

into

the market for funds,

the

higher.

higher

those

which

are

regu-

djwgy
cunty,

Pending the Fall revival

sues>

how

underwriters will enjoy the
opportunity of clearing away such
bits and pieces as remain around
ever,

from

recent offerings? And in the
tax-exempt, field,.the backlog ap-

as

considerable.

pears

Stepping

Up

Prpsmnnhlv

with

at the

view

a

avoiding anv probable
avoiding any probable

to

congestion
congestion

time, Consumers Power Co.

issues.

debt

issues,

Date

compared with common

compared with preferred stock

and

the

as

For

compensation

registered

absorbs,

on

the cost of flotation

Compensation

ferred> and 55% for debt issueg>

firct

mortgage

J.

.

.'

Oct. 21
of

as

bids

now

to

^

tu
month

Sept.

the
...

poiate

spell

decided
market

t

a

ahead

of

something

recent

/

and

mining

company

more

small

issues and small

th^ manufacturing

and mining company category,
average cost of common stock

financing

was

considerably higher

than for debt and preferred stock
financing.

11.5%

for smallest-size

Costs

were

the

communication companies and for
Except for small issues which
electric> §as and water companies had higher expenses, costs of reg-

almost
a

full

a

*

date,

or

on

and

of

behnvior

a

switch
of

ror-

behgywr -a short
of corOnly

borrowers.

back, with the investor de-




Joins Jesse Wood
(special to the financial
chronicle)'

WARRINGTON. Fla.—B. A. M.
McConnell has joined the staff of
jesse

Costs

hi§hest

lowest

^r

averaged
1.5%

for

for

flotations,
issues

mining

of

firms,

considerably less
companies with

assets over $100 million in confrast to 10% for companies with
assets under $5 miUion.
'
regiSfered

common

stock

issues offered to the general pub-

Wood>

Htv

.

542

gouth

Joins Hornblower & Weeks
'

was

averaged

CHICAGO, 111.
has become
blower
Salle

industry of the
uuauy
.

i£
/r,

Weeks,

134

South

But

istered issues sold through investment bankers to the general public did not change significantly as

between the years 1945-1949

(the

last period studied) and 1951, 1953
and 1955. Higher costs for small
common

buted

to

stock

the

issues

larger

were

attri-

number

of

a

CHICAGO, 111.—Robert

T. Bolin

hn_ Wftm_

_

has become connected with Leason
& Co., Inc., 39 South La Salle

With

Eidredge, Tallman

CHICAGO, 111.—Harold Feffer-

has

become;

Eidredge,
e

t

af
affiliated

Tallman
c?

&
fk

Co.,
On.

™

good teacher is being short-changed as to his
an
education. Yet we have allowed

to

teachers' salaries to

play tag with the average wage
paid workers in general during the past 10 years.

is
no
teacher
shortage today which an
adequate level of teacher compensation would not

There

few years.
have plenty\ of economic
finance schools
adequately is
"That

a

we

capacity to
generally recognized

by economists."—Prof.

John K. Norton, Teachers

College, Columbia University.
We

are

there is

prepared to

no

state

go

St.

(Special to The Financial Chronicle)

Why Go Begging
To Washington?

correct in

La

Street.

With Leason Co.

man

f

&

Hugh R. Beath

connected with Horn-

(Special to The Financial Chronicle)

shows that

„,.„y

"/special to The Financial Chronicle)

^bis leason, although South La Salle Street.

or

BJ_

Avenue.

right

common stock issues were more
important in number. As there

T.
+v~-

.

have

has

than

is

total

^

stock flotations, manu-

a

common

it

But

to

that

issues

costs ranged from 1.2% of gross
proceeds for largest-size issues to

,.

substantial dollar amount

of

bring

bonds.

23.

This
on

the date for the opening

for the

been

issue

,

set

Lewis

—

hppn

ed for

Re«istere(1 Debt and Equity Issues companies in
For registered debt

bondq

8 g

„
,
The company originally .
had

-

yp sizeSand
iU
suer-

Mass.

hns5

"We need a program that would
put a prepared
teacher in every classroom.
Any child who does not

the average, 85% of the total cost facturing

for common stock> 75% for Pre-

f

Staff

to

though utility issues also account-

were

jecte^offering o'f'VmiUioS'rf

the debt and preferred stock

cause

stock financing, continued in the financing was comprised to a
Penod °f the survey Higher total large extent of utility company iscosts for common stock primarily sues, and large issues of large
re»e,c,t higher compensation rates companies which generally have
usually Pa,d f°r common stocks, lower distribution expenses. At-

.

<:

•

of

case

as well as past studies
toward

common stock issues was
ana compaiative liguits costs for regardless of industry or
eviderit
lated and, unlike some of their for earlier years are presented.
size of issuer or size of the flotacounterparts, cannot raise the
According to the report, the tion. In comparing costs in aggrebulk of such needs internally, that traditional pattern of lower costs gate, however, the extent of the
is from earnings,
t
for debt and preferred stock is- difference was emphasized be-

especially

BOSTON,
10rnbur

.

data are classified according To lion in size.
size of issue, size of company, mThe
tendency

45 cents.

roornourn nas been added to the
staff of Keizer & Co., Inc., 19
Congress Street. Mr. Thornburn
was formerly with Preston, Moss
& Co- and Chace, Whiteside, West
& Window.
!'

rancas

lie by investment bankers, costs 1% and other expenses 0.35%.
The calendar has been building
for mining company issues ranged
As compared With the years
up and indications are
that profrom 15.6% for the largest-size 1947-1949-1950, the previous pespective new offerings will congroup to 33.4% for the smallest- 11(?
*01 which figuies on costs of
tinue to go into registration in the leased by the Securities and sized issues.
Costs for manufac- selling private
placements, are
weeks ahead. Industry
does not Exchange
Commission. The turing companies were about half available, there was no significant
show
any
signs of tapering off study covers registered issues of- as much, and for electric, gas and change in compensation rates but
sharply in its contemplated ex- fered through investment bankers water companies, about one-third other
expenses
were
slightly
penditures
for
new
plant
and during the period, as well as pri- as much.
Over three-fourths of higher.
equipment, though there has been vately-placed
issues,
and. other the common stock issues included
The report also points out that
some levelling out.
1
exempt corporate offerings. Cost in the survey were under $5 mil- the present analysis of cost data,

come

1955," Is
Superintendent

companies.

A survey of the cost

And while this-expansion holds
its current pace, corporations must

and

the

(Special to Tin: Financial
Chronicle)

weie

contrast

in

sues, and

of flotation
has just been released of securities offered during the years 1951,
1953 and 1955 has just been re-

report, entitled
Corporate Se¬

Keizer Adds

■

panies in the manufacturing and mining category.

u

C.—price

averaged

compensation

tIn

of

1953

from

Documents,
U.
S.
Government
Printing
Office,
Washington
25,

gloup*
,

in

,,

than

expenses

l.ii ms,

of

1951,

of

0.8%.

were

]arge companies and

jower for

nresenfpH

parillg costs of

Flotation

were
in
frequently

more

the

for

are

Tab/efac-

available

lor such services ranged from
°-2% oJ; £10ss Proceeds lor largest
issues to L9% for smallest issues,
er

up to
stockholders.

Milwaukee, Wis.

««/-Footn?tl:. Th? '"I!
Cost
of

debt-issu?s' Agents'services

piates

Plans to offer

averages

curities,

tain services and costs are not
present. The services of investment bankers were used in only
half of all private placements of

with

.

consudt&d^r'should .be

not

are

..

.

specific issues

is not

are

Kidder

Ca and William

the

placements,
agents
were
used
more frequently than
in debt is-

Costs

(1)

bidding.

Inc.-

stock to its

0.4%;
higher for
utility issues than issues of other

registered, privately placed, and

security issues.

exempt corporate

Co.

Inc.

The Milwaukee
Co.,

As explained in the report, total
costs of issuing private placements

companies

differential pattern of lower costs for debt and
preferred stocks as against higher common stock costs. Latter,

satisfactory backdrop for the large

for the post-Labor Day period.

Underwriter

continue past

secondary

developing
should* < bet as a
debt

of

costs

«nnnnniLWaV;®POr,ted comPany
common

$300,000 of additional

.

bentures appeared brisk,

Exchange Commission study permits compari¬

flotation

&

Wisconsin Southern Gas
Co.,

J.argef than in small, issues and

norations

'

Stuart

,

-

employed

equities, at least for the moment,

*

issue and

and about

construction

competitive

+?°xberi W-' Baird &

with

and toward debt securities of

For

—

(jointly). Registration—Of bonds in
Sep¬
tember; and of stock in August.
:

equity issues
placed privately, which comprised
approximately 3.5% of all direct

other

be

outpouring of corporate

and

R?^re*r^n
& Co.

from

areas,

away

Underwriting Costs Analyzed by SEC

if

forward

major consideration at the

market

fixed

are

such

sons

moment

mining

Other

calendar.

The

the

upon

Halsey,

Private Placements

York

York

Underwriters

by

^ SUrVey"

disappointed

considerable time

a

glanced

one

Indi-

organizations

since the current lull has been in¬
dicated

in

bond market in

to open

record"at

for holders of

The

year.

°£ C°n"

debentures.

Books

midsummer

looking

conditions

porate

the

Away From New York
People

Big Convertible Due

of

^ & ^ C°'

change in

a

the market picture.

stock

repay bank loans.
be determined

to

bidders:

Blair

first

seT back offerine/in "the

to

New

Co.

Co
(2>
(first to stockholders on a
1-forBoston Corp., Merrill
Lynch, Pierce,

announced company plans to sell
$20,mortgage bonds. Probable bidders for
include: Halsey, Stuart & Co. Inc.; Kuhn
Co. and American Securities
Corp. (jointly);
Bros. & Hutzler; Eastman
Dillon, Union Secu¬
Co.; Stone & Webster Securities Corp.; White
Co.
Bids—Expected to be received on Dec. 3

of

Service

For any common stock
10 basis): The First

(12/3)

may

mounting yields

ever

it

8

000,000

Underwriter

Co.,

Peabody & Co.; The First Boston
Corp.; Merrill LynchJ
Pierce, Fenner & Beane; Salomon Bros.
& Hutzler and
Eastman Dillon, Union
Securities & Co.
(jointly); Dean
Witter & Co.; Lehman
Brothers; White, Weld &

ol

of

Public

and to

bonds

Probable

<

(9/24)

The corporate new issue market

For

Peabody & Co., New York.

also announced company plans to offer

was

stockholders

&

Proceeds

program

stock

common

as

program.

Securities

late in August.

nnn nnn

paragraph.

common

of

receive

Union

M?,y u9
was announced company plans to
II
?7>000>°00 ot first mortgage bonds
$5,000,000 common stock.

(other than Eastern Utilities

and

$2,500,000

is

Dillon,

Wisconsin

also announced Blackstone plans to offei

was

to its common stockholders

Virginia Electric & Power Co.

to

construction

Eastman

program.

Utah

For

—

Blackstone

sell about $15,000,000 of first mortgage bonds due 1987.
Proceeds
To repay bank loans and for construction

March 12 it

was announced company plans to issue and
$2o,000,000 of convertible subordinated debentures

Proceeds

announced

was

within

Power &

March 12 it

it

15

company, a subsidiary oi
Valley Gas & Electric Co., plans to issue,
one year, $4,000,000 of
bonds, $1,100,000 of notes
and $900,000 of preferred stock to its
parent in ex¬
change for $6,000,000 of notes to be issued in
exchange
for certain assets of Blackstone.
The latter, in turn,
proposes to dispose by negotiated sale the first three

ing of
working capital.
Utah

★ Westcoast Transmission
Co., Ltd.

J"1/J5 it
sell

Valley Gas Co.

announced company plans a public offer¬
securities to provide about $6,700,000 of new
was

45

further and to

in the union which

say

that

is not finan¬

cially able to provide ample educational facilities
for its children.

Why then bring the Federal Government into
situation far better left to local direction?

a

with

231
sat

Financial Chronicle

The Commercial and
46

the

Investment

Opportunities in Latin America

at

The Council

all-time high.

an

non

only

constitute

of the total force em¬

America

Latin

to

all-time high—in
excess of $7 billion—according to
a
study released by the United
States
Inter - American
Council
today

at

an

with

concurrent
VIII

Plenary Meeting of its par¬

ent

today,
of

duction

held

American

Inter-American

the

Council

in

Aires,

Buenos

is

amount

double

the

credits

received

total of

all

foreign

billion.

intergovern¬
mental credit institutions, accord¬
ing to the Council, and points up
X*a

in

crease

value

ments
about

$3

billion

witnessed in¬
of these invest¬

in

1946

to

an

production

when

age

ex¬

cases

of foreign

amount

over

can

panies in

that this trend of investment and

America

reinvestment

lion, and it is fair to assume that
at
least
some
portion
of these
goods, would have had to be im¬
ported, using precious foreign ex¬
change, were it not for the activ¬

is

continuing

at

a

record pace.

in¬
the
Council says countless opportuni¬
ties for productive investment are
still to be found throughout Latin
America and await only the en¬
couragement of friendly govern¬
this

Despite

initiative

the

and

ments

tremendous

investment activity,

in

crease

Local
billion

United

Commerce

a

American

in

Latin

the

Economy."

This

for

Living

inevitable

sion

of

supplies,

dends,
able

vealed

is

to

Latin

from

and

for

of

a

United States
covering nearly 1,000

parent

about

This

85%

ployed

of

by

total

United

investors in Latin

management
and diver¬

share

in

to

management

for

to

record

promptly, and the penalty
directly by the enter¬

'25cents

of

the

"Private

Council

the

ness

em¬

with

carries

capital

INC

.

of

close

the

at

arid
<

der

busi¬

Stocks

until; such
been
exchanged

have

vi

hteh

entitled

tin¬

securities

of

the Plan

of the

to

Reorgani?ation

Company, which became

elTective

August 9, 1957.

Common

holder*;are

those

the old

ompany

for the'ueu

shareholder? of

the

the

he dis¬

not

1952.

February 29.

stock

•

are

i .a

r

urged to communicate with the Con., rainy.

v

11.
Executive.

July

BAT.CObYnV.

\V".

I i<*e

I'ret ideal

Secretary

aew

26, 1957.

it

divi¬

pay¬
consider¬

the incomes in
according to the

demands—and receives
attention

detail

to

'

-

in

marketing by men

—

-V
o

these conditions

under

conducted

w

K
.

devoted

v~

ALLIED PRODUCTS

e

AiWh

%

CORPORATION

o

CORPORATION

m

production
who stand

managers

the livihg standards of

to

gain

Detroit 23,

DIVIDEND

COMMON

NO.

78

basis of centralized planning often
tends to be operated routinely by

On

with only
terest in efficiency."

a

passive in¬

a

on

taking

July 24,

1957, the board of directors of Allied

Michigan corporation,
the

Common

shareholders

shares
of

Products Corporation,

declared a quarterly dividend of 40c per share
of

record

the Corporation,
at

the

close

of

payable September 30,
business September

lb,

1957
1957;

competition before under¬

for the

Economic Problems of Next 20 Years

Michigan

high

by

to

Most Important

NOTICE

DIVIDEND

lenging forces imposed by the
free competitive system. Business

in terms of its impact on the econ¬

GEO Competition On

,

holders oi

to

shares

10,

low-through in management func¬
tions because it
must meet the
continuous
and
merciless
chal¬

and

and

dividend will

Preferred
of

per

September

Holders of the old

states,

em¬

omy

N.( Y,

borne

private

America.

6.

a paper.

of

Members

Board

visory

Research

the

of

the

CED's

Ad¬

Re¬

search and Policy Committee, who

Committee

The

Development
nounced

Economic

(CED)

best

Free World

Edward

by focusing the atten¬

judge

the

S.

competition,' are:
Dean of the

Mason,

an¬

to

find

tion and energies of the American

Harvard Graduate School of Pub¬

opinion

people upon likely trouble spots
beyond the immediate horizon."

lic

informed

of the Free World

growth and stability of the whole

will

has

competition

a

the

what

for

regards

as

"the

Administration,

Chairman;
Schultz, Economics

W.

Theodore

that Professor, University of Chicago,
limited Vice-Chairman; Richard M. Bisto Americans, but 'Wlls as well sell, Jr., Washington, D. C., econo¬
in
Assisted by a grant from The upon the best minds of our friends mist; Howard R. Bowen, President
and allies overseas."
of Grinnell College; Douglass V.
Ford Foundation, the CED invited
"Because the economy of our Brown,
Professor
of
Industrial
papers on the question as part of
the observance of its 15th Anni¬ country plays such an important Management, Massachusetts Insti- ;
role in maintaining and strength¬ tute of Technology; Robert D.^B;;.,
versary.
..

most

important economic problem
faced by the United States
the next 20 years."

to

be

He

the

was

pleased,

\competition

he

was

said,

not

r

.

Fifty

ening
freedom
throughout
the
will be
world," he added, "its functioning
authors of papers sub¬

prizes

awarded to
mitted in

of

$500

and

competition and judged

by
CED's
Research
Advisory
Board, a body comprising some of
the

country's

distinguished

most

social scientists. "
Additional
be

awards

of $500

will

its

future
of

concern

have

become

the

thoughtful
citizens
Free World."

throughout the

"Out of their

thinking," Chair¬

of

pressed

David, Chairman

Board

the

of

hope

petition would

Trustees,
the

that

"contribute to




of

ment,
York

ex¬
com¬

the

search, Inc.; R.
nrtmipd

^:

Gordon,; Ecd- ':. {

A.

Prnf oco'rtF^' 'T7i'V'iiiTiircH!fr

:"

^

President

to

avert

them

economy.

CED's

National Bureau of Economic

tion; Arthur Smithies, Department

means

50

K.

FabriT Va¬

and' find

leaders

Donald

;

David

competition to while the situation is manage¬
outstanding scholars able."
in public affairs for
Papers submitted in the com¬
papers on the same question.
petition must not exceed 2,000
CED is composed of 150 leading words in
length, must be type¬
businessmen
and
scholars
who, written in
the English language
working
together,
conduct
re¬
on one side of the paper only, and
search and formulate policy rec¬
ommendations on major economic mailed before Nov. 1 to Problems
issues, and promote education on of U. S. Economic Development,
the
operation of the American Committee for Economic
Develop¬
and

Institution;,; Solomon

cant, Director of Research of the

asserted, "CED hopes
to anticipate economic difficulties

man

without

made

each

Calkins, President of The sBrook- <«>;

ings

444 Madison Avenue, New

ants

to

write

for

a

copy

of rules

The

Ford

Founda¬

of Economics of Harvard Univer¬

sity;

GeorgeJ,i;;StigIer,;:|5plitical

Science

Faculty,

Columbia

Uni-r

-

versity; and Henry Wallibh - df theAU;
Yale Economics Department.
-

,

Associate
search

members

Advisory

of

Board

the
are

208 TH COMMON DIVIDEND

Re¬

Roy

A

regular dividend of One Dollar

Blough of the Columbia Graduate

been declared

School

Tobacco Company,

of

Business;

Calvin

B..

Hoover, Chairman of the Duke
University Economics Department;
Jacob

to

upon

($1.00)

per

share:has

the Common Stock of The American
payable in cash

on

stockholders of record at the close of business August
•

Viner, Economics Professor

Princeton; and Ralph A. Young,

Director, Division of Research and
Statistics, Board of

Governors

the Federal Reserve System.

of

;

.

September 3, 1957,.

1957. Checks will be mailed.
»

at

22, New York.

CED urged prospective contest¬

of

July 30, 1957

E.

South La Salle

Co., 231

YORK

NEW

tributed

Stock

Commori

payment

1957

re¬

are

on

efficiency.
In
contrast, capital employed on the

assets

States

Herbert

Hemphill,

/

a meeting held
declared a quarterly

dividend

$1 billion in salaries
and wages paid to 600,000 Latin
American
employees in 1955 is
one
of the most important items

represents

group

—

with

conscientious and industrious fol¬

Almost

subsidiaries and branches in Latin
America.

this day,

lack

Under government plan¬
ning and operation, however, the
people as a whole would bear the
penalty."

study.

300

companies

America,

STREET.

Company, at

of

their

prise.

miscellaneous

and

portion

alysis, based on the year 1955, re¬
capitulates information obtained

interest

accounted

ments

an¬

salaries

and

is

Street.

of the

The Board of Directors

waste

funds

mistakes

by these companies in 1955

wages

Noyes &

This

non-productive
Under private management,

uses.

$4

over

III

Tucker

.important:
I:

DIVIDEND

adminis¬

and

is

business

efficient

Further,
of

expenditure

(Special to The Financial Chronicle)

CHICAGO, 111.

COMMON STOCK

how¬

views,

financed

programs

with

ployees, taxes and other payments
to
local
government,
materials
and

"The Role of United

on

Investments

States

in

recent analysis by
States Department of

on

com¬

these

the Council asserts: "One of
frequent weaknesses of gov¬

tered

Standards

■

Council's study is based

The

large part
the

development.

Expenditures Raise

Local

alert

of

States

United

panies.

private business management for
their speedy

the

of

ities

United States com¬
markets of Latin
another $2.5 bil¬

local

totaled

RECTOR

TWO

ever,

the

ernment

economy.

Sales by the

Hemphill, Noyes Adds

FOREIGN POWER COMPANY

AMERICAN &

activity.

business

of

Countering

Co.

Co.

Link, Gorman &

that

government for financing and ad¬
ministration

a

$7 billion at the end of 1956. Late
indications, the Council adds, are

enter¬

methods, often linked with
advocacy of greater reliance on

was

&

DIVIDEND NOTICES

prise

ex¬

most significant
contribution to the Latin Ameri¬
change used is

of free

criticisms

founded

He

Kneeland

with

circumstance has in
given rise to un¬

This

many

a

and

Street.

Salle

La

South

formerly

Co., .209

Tegeler &

-

with

affiliated

now

incom¬

and

scattered

been

plete.

exchange

foreign

of

the

twice

the past decade from

over

In

to

is

Dempsey

realize that they, in
turn, must be prepared to accept
their full obligations in this busi¬
ness
partnership.
They ask no
unfair advantage and1 seek only

Council, these and other per¬
partici¬

have

importance to Latin America, this

which has

trend

Foreign

billion.

according

years,

many

111. —Thomas J.

CHICAGO,

possible

best

Dempsey-Tegeler

Gartland

such investments
will be made. The private United
States investors represented in the
United
States
Inter - American

guarantee

pation of foreign capital in vari¬
ous parts of the world's economy,
and particularly in Latin America,

favor¬
able trade balance is of such vital

and

governmental

$2.3

the

is

treatment

tinent facts relating to the

States

It

Council fully

For

the

America.

of the governments of the
host countries.
A record of such

cited.

change used for all purposes by
the companies totaled
only $1.3

and

loans

all

from

totaled

than

more

United

the

from

flow

Argentina, July 15 through 19.
This

foreign

and

exports;

exchange inflow to Latin Ameri¬
ca from these exports plus capital

Pro¬

and

Commerce

$4.9

were

mu¬

their sharehold¬

for

(Special to The Financial Chronicle)

the part

panies to develop the human re¬
along with the natural re¬
sources of Latin America could be

represented 10% of Latin Ameri¬
ca's gross domestic product.
Ex¬
ports
by
these
companies ac¬
counted
for
30%
of
all
Latin

the

of

opening

1955

for

companies
billion, and

these

of

conduct

so.

-

With

on
fair and
treatment on

non-discriminatory

sources

sales

Total

to

to produce

as

and for the people of the coun¬

ers

investment

direct

future

operations in Latin
will
be predicated

citi¬

talents of local

by United States com¬

efforts

of

Benefits

utilize

to

and heavy concentration on
training programs to help local
workers assume greater responsi¬
bilities. Countless other examples

discriminatory treatment.
United

efforts

direct

services and

people of the host country. Warns that an attractive,
conducive economic atmosphere is predicated on fair and non¬

of

benefits

tual

concludes:

the Council

atmosphere which is conducive to
efficient and profitable business

This fact

by these firms.

ployed

the

Latin America

business

guests."

"The

zens,

investment

opportunity

terprise will be in direct relation
to the existence of an economic

that

noted

be

Americans

about 112 %

tunity to produce mutual benefit for its shareholders and for

business in

the

their

in¬

try which has received them as its

reflects

Direct

direct

of

future

activity of United States free en¬

prise is superior to government planning and operation, and
that it asks for no unfair advantage but seeks only the oppor¬

States

Direct Investment

of

the

to

vestment,

Latin

private enter¬

avers

Future

As

country.
It
should

for American investors according to a recent study by
the United States Inter-American Council which reports invest¬
ments

to this group was

1957

1955, with variations from indus¬
try to industry and country to

found to be still

Many opportunities in Latin America are

The

Average salary pay¬
$1,600 in

people.

ment

open

is

Thursday, August 1,

...

(518)

Harry L. Htlyard

Vice President and 7

reasuter

'*,

Volume 186

Number 5660

The Commercial and Financial Chronicle

...

(519)

from

The

the
Dansville
and
Mountaintop
plants has placed Foster Wheeler

2

page

Security

engineered

and

in

constructed

energy

France.

About

orders

one-third

generated

are

subsidiaries and
a

s

higher

foreign
with them

margin

profit

of

than

U.

S.

The
1.957

totalled

March

S364,436,723,

up from $198,379,477 a year
before. The present backlog is im¬

the

when

592,484

against

measured

shares

common

out¬

standing. This works out to better
than $615 of backlog per share, a

Co., and the

stellation,

On

share,

year

Directors declared

seventy-five
the

on

cents

common

a

with

fered

the

flow

even

of

escalation

including

per

costs which

Thin

just became effective.

margin

late

steel

bid

contracts

1954 and

1955

in

on

affording little

close of business

at

the

increase

in

it

to protect

is

earn¬

ings in the neighborhood of $7-$8
in 1958. based

snare

ent

the pres¬

on

Capitalization. With' produc¬
starting to rise against in¬

tion-

creasing

backlogs,

has found

it

$6,000,000

from

term

notes

the

company

to

necessary

banks

borrow

R. G. HENGST,

arranged

loan

of

ance

company

$2,000,000

facilities.

business

July 24.

equity

regard,

1957

of

likelihood.

strong

MIAMI
61

stock

continue

vorable

to

reflect

longer-range

rights

offering

of

record

the

at

...

/

-

JOHN

...

13,

a

year.

This

riet(/y

$130,000,000

on a

jection of first

DIVIDEND

15

to

stock,

share

per

its

on

payable September 20 fb

The Board of Directors has

H.

ALEXANDER

shareholders of record August 8.

declared

of

raises the annual dividend rote 10 per cent

regular quarterly

a

dividend of
Fifty cents
share

on

to

($0.50)

of

6,

N.

to

cent

pre¬
on

shore, and th*
the 5'/i

on

per

Cumulative Convertible Second Pre¬

ferred Stock, Series of 1955, ot 41 V4»h cents

FOX, Jr.

1957

Bloomfield, N. J.
July 23,1957.

to

share, each will be paid

September 1

on

shareholders of record August 8.

Vice President
and Treasurer

W. D. FORSTER,

Secretary

July 18. 1957

SUNRAY MID-CONTINENT

business

of

compared to $1.20

Cumulative Preferred Slock,

quarterly dividend (No. 9)

record

M. J.

24,

os

Series A, ot 28'/eth cents per

per

Y.

share

per

the 4'/j per cent

COMPANY

York

$1.32

This action

viously. The quarterly dividend (No. 9)

stock

common

August 9, 1957.

Oil
SUNRAY BLDG.

TULSA, OKLAHOMA

GREENBURGII,

Mobil
NATIONAL SHIRT SHOPS

m

The

s'vtcatoslt

share
Payable August 30,1957
Record Date August 15,1957

61

declared

OIL

a

of 10c par share in
the regular quarterly
divi¬
per shave on
the common
payable' August 30, 1957 to
stockholders of record August 20, 1957.
Transfer books will not be closed.

MOBIL

COMPANY
TIIE TEXAS COMPANY

INC.

to

both

SYLVAN

H

Cash: 15< per

SOCONY

INC.

NO.

Directors

2Cc

of

stock,

july 74, .957

of

dividend

addition

dend

_

Declared

Eoard

end

year

_

common stock

DELAWARE,

DIVIDEND

m

•w:

Chairman

of

Board

220th

Dividend No. 186
The

Board of

COLE
the

23, 1957 declared

a

July

on

quarterly divi¬
the out-

on

standing capital stock of

Payable December IS, 1957
Record Date November 15, 1957

this

Company, payable September 10,
1957, to stockholders of record at the

|f|

close of business August 2, 1957.

National

A. M.

-

Consecutive Dividend

Directors

dend of 5()£ per share

Stock: 4%

Sherwood, Secretary

■

*

V

A

regular quarterly dividend of
fifty cents (50$) per share on
the Capital Stock of the Company
has been declared this day, pay¬
able on September 10, 1957, to
stockholders of record

of business

at

the close

August 9, 1957.

on

The stock transfer hooks will
WAWAVAWAV.V.».V,V,V

Distillers

re¬

?,WA%W.V.W.V.V.V.VAa

main open.

S. T. Crossland

and

Vice President & Treasurer

July 26. 1957

PHELPS

Chemical

American
Bank Note

DODGE

CORPORATION

Corporation

<♦>

Company
206

The

Common

196

clared

Dividend No,

quarterly dividend of 75<f per share
(l'/j'/n) on the Preferred Stock for the
quarter ending September 30, 1957 and a
dividend of 30c," per share on the Com¬
Stock

mon

holders of

straight line

pro¬

stock

1957

vol¬

dividends

have

are

declared.

Board
a

Common Stock,

Both

de¬

quarterly dividend of

25c per share on the

tember

has

Directors

of

The

3,

1957, to

of' record

stockholders
9,

August

on

Sep¬

on

1957.

The transfer books will not close.

E". F.

books will

remain

C.

PAUL

open.

Page, Secretary and Treasurer

July 25, 1957.

JAMESON

Board

declared
dend

outstanding

payable

record

transfer

July 24,

been

payable October 1, 1957 to
September 6. 1957. The

NOTICE

DIVIDEND

Preferred Dividend No.

than

of

Directors

third

has

divi¬

quarter

of Seventy-five Cents (75(f)

share

per

of

a

this

the

on

capital stock

Corporation,

September

10,

holders

record

of

1957

payable
to

stock¬

August

16,

<

90c) per

Treasurer
M. W.

share

of

on

been declared,
to

cents

payable Seplemher

stockholders of record

at

the close of business August 2.1957.

URQUHAKT,
BIRNY

MASON. JR.

I ice-President and

NOTICE

Ninety

the outstanding

capital stock of this Corporation has
3. 1957

1957.

1957

cash dividend

A

Treasurer.
FINANCIAL

July 18, increased the Com¬

thirty-three (33) cents

Wall and Floor Tile

with

Obviously, the expansion at

ume.

No.

common

to

close

Tiling Company, Inc.

sales

quarter

on

pany's regular quarterly dividend (No. 71)

a

Manufacturers of Ceramic

A

less

71st REGULAR DIVIDEND
The directors,

Treasurer.

compares

of

rate

July 31, 1957

Secretary

I NiON CARBIDE CORPORATION

Austrian Government

YALE &.TOWNE

Guaranteed Loan 1923-1943
The Trustees of the
ment Guaranteed Loan

the announcement

the

21st

stated

legal

November

thev

that

Austrian

Pullman

Govern¬

1923-1943 refer to

were

which

in

aware

of

they

DIVIDEND

ment of Bonds of the American issue con¬

Quarterly dividend No.

taining a gold clause. They further stated
that they desired it to be known that
they would remain in office until further
and were retaining the securities
provided under the General Bond and a

mon

portion of the Reserve Fund.
In

of the

view

earlier notice
of

the

fact

was

that

the Obligor or the
payment of the Bonds on
have failed

instituted,

or

for
basis

Trustees
a

Trustees

gold

desire

it

to

be

known that they intend to return to the
Austrian
Government, as soon as the

arrangements
can
be
com¬
the balance of the Reserve Fund

necessary

pleted,
now

tees'

held

by them, whereupon the Trus¬

term of service will have been com¬

pleted.

Delta Air

declared

Lines, Inc. has

quarterly divi¬

Corporation

It

payable September 10,

dend of 30c per

1957, to

the

stockholders

of

a

Wi

-li-

ness

August

16,

1957.

Richard F. Hansen

Secretary

PIERRE

MEYNIAL, Secretary,

14, Place Vendome, Paris, France.
31st of

July, 1957.




ti

payable

company,
tember 3

to

Sep¬

%

-P

it'
mk

14, 1957, to stockholders of
ord

August 23, 1957.

at

the

Continuous Cash Dividends

DELTA AIR LINES, INC.

August 15.

General Offices:

of Directors out

earnings,

payable

«

on

Oct. 1, 1957, to

CHAMP CARRY

stockholders of record

President

the close of business

Sept. 10, 1957.

KELLOGG!
Wm. H.MATHERS

tW/

Vice-President

and

Secretary

Atlanta, Go.

Organization in 1920

TRAILM0BILE

%

was

the Board

of past

rec¬

close of

business

share

declared by

at

of record

thirty-seven

per

dividend of
(750) per
paid on September
cents

stockholders

July 30, 1957

Have Been Paid Since

July 25,1957,
of

A regular quarterly

seventy-five

Share

and one-half cents

Quarterly Cash Dividends

share will be

on

capital stock of the

record at the close of busi¬

I
I

share

.

For the Trustees of the Austrian
Government Guaranteed Loan 1923-1943,

Dated:

Stock of

a

dividend No. 278

91st Cohsecutive Year of

The Board of Directors of

W
m

been discontinued wherever

the

the Com¬

Allied Chemical & Dye

lapse of time since the
published, and. in view
all legal proceedings

against

on

On

360th Dividend and

CASH DIVIDEND No. 40

146 of $.75 per share has

been declared

notice,

37Vii

Incorporated

various

proceedings which had been insti¬
by certain bondholders in Austria
elsewhere with regard to the pay¬

tuted
and

Declares 278th Dividend

published bythem on
1935

&

-A0

*

.

per

1957

the

close

G.

Rensis

DIVIDEND NOTICES

earnings,

September 11, 1957.

American Encaustic

a

$200,000,000 in bill¬

over

annual

an

New

de

immediate

CORPORATION

quarterly dividend of fifty (50c)
per share was declared, payable
September 26, 1957, to stockholders

shareholders

to

1957

cents

the. fa¬

outlook,

Foster Wheeler has the capacity
to handle

ings

cents

July

the

be in the offing.

may

declared

has

at

COPPER

Broadway,

P.

about

importance.

A

a

present
volume

Should

selling

for

stockholders

.

with

now

DIVIDEND NOTICES

A

financing at the
early 1958 seems

or

attractive

is of secondary

1957.

9,

is

capital appreciation where income

1957.

insur¬

an

to expand

The

currently

payable August 19, 1957,

long-term

with

August

BOSTON, Mass.—Dante Bailerini

compo¬

fifty-five

record

re¬

successful

September

on

of

a

'

of

working capital and, in this

more

a

on

of

as

With P. de Rensis
(Special to The Financial ChIionicle)

the

Co., 126 State Street.

NOTICES

Directors

and

shares of Foster

common

times indicated

appear

Secretary

expanding'

a

built

D.

five states and Ontario

increasing
obviously underlines the need for

end

payable

stockholders

inventories and, just recently, the
company

12

business

swings in profits

Wheeler,

Secretary

Manufacturing plants
in 15 cities, located in

short-

on

finance-

to

of

dividend

OF

margins,

a

volatile

sult, the

August 5, 1957.

^

a

Board

largely completed.

unreasonable

not

share

shares of the

shareholders of record

to

Assuming Foster Wheeler's vol¬
ume
reaches
the
$200
million
plateau and allowing for only a
small

the

carrier

highly

Company, payable August 23,1957,

protection against rising costs have
been

The

share

ma¬

higher

for

company's

Singer Manufacturing
Company

quarterly

dividend of

(75c)

up

terials. Virtually all contracts now
in
force
are
protected
by full

has

the

DIVIDEND

The

sharply
$1.81 a share in the previous
when the steel strike inter¬

from

The

the

COMPANY

July 26, 1957, the Board of

earnings for the remainder of
the
current year and
1958». For
1957,
earnings are expected to
a

po¬

condensers for

aircraft

and

for

DIVIDEND No. 148

leverage factor which
possible a sizable increase

$5.00

Navy

since.

contract

a

submarine, the Nautilus.
Conceding the cyclical nature of

'

in

better

second

MANUFACTURING

EATON

tremendous

makes

has

main boiler and

nents

31,

which

merchant
sales

construction

accelerated

company

com¬

CLEVELAND 10, OHIO

of

as

was

pressive

The

DIVIDEND NOTICES

contracts.

backlog

tanker

atomic

the Forrestal class, The USS Con¬

!

the

the

,

by

carry

for

equipment,

excellent

New

greatly

the

of

boilers
show

in

foot

Besides

began to increase in 1956 and has

manu¬

currently
selling such
to Consolidated Edi¬

son, Duquesne Light

plant

power

tential.

its

door.

energy

marine

components

with foreign subsid¬
Canada, England and

in

plants.

power

is

pany

keeping

atomic

marine

Combustion

and

facture of components for nuclear

conjunction
iaries

Wilcox

&

have-be'en installed for the

designed,

are

the

Engineering. At the Mountaintop
plant a_ number of new machines

Many of the corporation's
contracts

an

cock

towers, and nuclear energy power
plant equipment and research re¬

foreign

nuclear

excellent

competitive posi¬
tion with such companies as Bab-

I Like Best
actors.

government,

in

Continued

47

J

the

YALE & TOWNE mfg.co.

Cash dividends paid in every year

since 1839

The Commercial

48

Financial Chronicle... Thursday,

and

(520)

other

WASHINGTON, D. C.
diction
merce

will

economi¬

the best year

Thus

cally in the history of the United
States came as no surprise to
economists in the Nation's Cap¬
'

ital.
Plant

and expen¬

expansion

ditures lor tools and equipment
have been

running ahead of the

burdens.

great

With forecasts of another

;

been

:

in 1954.

The last tax cut was

;

|
!

economically, there was re¬
newed apprehension in Congress
about
the inflationary trends.
Both Secretary Weeks and Con¬
gress warned that the new rise
in living costs was bad for the

he

when

him

holed

home, asking him to vote for tax

high

as

on

>

each

rates
they were

Federal

the

almost

now

tax

as

World War II, there ii
growing talk of overhauling the
Internal Revenue Code.

Representative Wright Pot¬
Chairman of the Joint
Economic Committee, said his
colleagues on the committee are
greatly concerned at the con¬
tinued price rise.
As a result
the Joint Economic Committee
staff has been directed to blue¬
print

affecting

factors

the

of

prices

tax is

Commit¬

form

economic prob¬

fall.
There is

insisted

that

in

private

the

'

maintain

ing factors to current inflation¬
ary

squarely to the problem of in¬
flation," said the Joint Economic
Committee.
Restraining infla¬
tion

has been and

never

will be

easy

an

never

contend with the
problems which may become in¬
creasingly complex. Tbe current
offer

debt

Demands for

pressive example.
immediate

substantial

and

and

credit

are

economic

Steady

o

achieved

e r s

unless

will not
are

ings of objective and dispassion¬

inquiries."

Soft

Mills

(Arkansas) of the Subcommittee
Fiscal

Policy for the Joint
Committee, reported that the
on

outlook

economic
mainder

of

for

the

re¬

1957 ancl early 1958

indicated continued increases in

output and income. At the same
time the subcommittee findings
said

"a

number of soft spots

in
emphasize the need
or continuing alertness to possi¬
ble changes in overall levels of
the economy

economic

activity

which

may

require revisions in current pub¬
lic policies."
The

Joint

Committee

tains that in order to

reductions

steady

The

(

margin by which
the House killed the bill author¬
narrow

izing

construction

school

did

states

under

economic

not

main¬

justify tax

conditions

growth,

of

more

remains to be done by Congress




the

on

a

the actual

the

Had

direct

a

Supplements

—

Company, Book

Tower, Detroit 26, Mich.— $15.

Construction

the

for

outlays

first half of the year were at an

about

of

rate

bil¬

actual

$46.1

of

for

Despite the decline in private
housing, the Commerce Depart¬
ment says reports show

ing

that pri¬

construction accounted

for

six months

it
by

Indications
the

In

are

Interstate

growing

that

will grant an increase
freight rates to the railroads,
probably before Thanksgiving.
mission
in

Last December

earlier this

and

the Eastern, Southern and
carriers were given an
interim increase. Any future in¬

year

crease

would

sources

"over

be

above" the interim
fied

and

raise, quali¬

equipment. The lines
to

have

Capital
give a re¬
port to the Interstate Commerce
Commission on what they have

several weeks ago to

done to improve service and at¬

tempt to win back many former

railway

passengers

who

have

taken to the airways.
ICC

records

railroads

new

in

-

commercial e; and;,

investments

the

in

made

losses

new

would

National* Security

Policy

Peering into the
future, spokesmen say that the
vast
new
interstate
highway
greater.

plus the expanded air¬
more new airports, the
railway passenger business is
not bright despite the tremen¬
dous population growth.

show

chalked

up

that while
the

they

tions— Association

construction
like

the

would

West
N.

a

the

book¬

method

by

did

not

which

it

dumped. Perhaps the pro¬
posal will be revived in 1958.
Prior to the strike in the
ment

industry,

United

construction

States

another

was

ce¬

While

and

Nuclear-Atomic Economic Sur¬

abandoned passenger
the stations,

service? The tracks,

vey,

York 17,

have

to

employees would still
be kept for the normal

Pick
Subsidize

Passenger

Service?

question has been raised
Capitol Hill whether or not

that the passenger

subsidized

be

trains should

from

private construction like
half of

taking

place at

a

1957, other
have

record

N. Y.—$5.

$35.

airplanes

lines.

Ernest

C.

ancl

steamship:

Nickerson, the

V "V-

.•

Typists

Syracuse,

like

6,

»'»v- '

Smith-Corona,

1, N. Y.

On
Your

Buying

—

(Paper)

—

request.

New York Central's Vice-Presi¬

Funds

and

panies—Leo

and

Research

service, pointed out to

—

Inc., 701 East Washington Street,

funds

tax

1

>'

to

Tips

Corporation,
N.-Y.—(Cloth)—

Publishing

York

New

The
on

New

Avenue,

Park

101

Pick's Currency Yearbook—Franz

freight train operation.

the

N,

ICC that the public has "learned

ernment

to

Guide

Mutual

Investment

Com¬

Barnes—American

Council,

Larchmont,

Y.—(Paper)—$3.95.

on

rec¬

accept subsidy from the gov¬
in

the

case

of

TRADING MARKETS

seme

Botany Mills
A. S.

Campbell Co. Com.,
Fashion Park

c*C^V

,0Y.V.^;

Indian Head Mills

^ -FOREIGN

been,

level,

according to the Department of

20 BROAD

TEL:

Morgan Engineering
National Co.

&

Co. Inc.

Riverside Cement

Flagg Utica

SECURITIES SPECIALISTS
STREET

HANOVER 2-0050

,

United States Envelope

Carl Marks

pace.

houses, stores and churches, was
first

high-energy "exotic fuels
high-temperature metals—

—On

in

at

off the

44th

Y.—(Cloth),

the railroads be better or worse

to

moving

record

ahead

lines of construction

Bar

of

off if they

1956, the second highest

opposed to

they

the

of

New York, 42
Street, New York,

City

Nuclear-Atomic Economic Survey

question remains: Would

keeping loss of $696.9 million in

administration

bill,

Na¬

sub-

a

was

the

the

of

lines and

to

Laws

Foreign

With

dent in charge of passenger sales

that

¬

and
Foreign
Application ©1'

Antitrust

Commerce

members said

were

Eisenhower

the

in

American

program,

The

or

sible

not

equipment,
have been

business

bodies;, service clubs, fraternal
organizations and other respon¬
groups—New York State
Department of. Commerce, 112
State Street, Albany 7, N. Y.

cars

passenger

Nevertheless, spokesmen said
had

of

ganizations; > schools,
women's
clubs;
church : societies,
labor

locomotives in the last 25 years.

that

-

.

Library' Catalogue—List

available
16-mm.,; sound films
for
free r showing
industrial,

$800 million

passenger

million

$600

and

Avenue,

N/Y;—40c.,M: ;•.%>

1,
Film

carriers

the

said

spent nearly
8.894

for

were sum¬

Nation's

the

before

now

of Labor,
New York

Department

and many

say.

Meantime,
qualified
people
say the railroads have made a
strong case for themselves rela¬
tive to; improved
passenger
moned

industry

even

Com¬

Commerce

testimony

the

their

Expect Freight R*;te Increase

profit during gasoline
rationing during World

a

stantially greater vote than the
narrow
208 to 203 margin.
A
number of House

S.

Ninth

341

last

the ICC, spokesmen for the rail¬

been

of this year.

lines

The

War II.

than 70% of all new build¬

during the first

$704.5 mil¬

was

1953.

and tire

road

all of 1956.

vate

showed

ex¬

billion

with

lion, compared

penditures

$46.7

highest

in

lion

partment.

annual

ord. The

issue

motion to strike

clause,

defeated

been

to

money

reveal

on

enacting

have

Federal

opposition.

of

been

the

in

billion

$1.5

instead cf

D.

$5487

postal workers.

margin

Wilbur

a

than 500,-

more

School Bill Killed

vote

Spots Cited

Chairman

would grant

annual raise to
000

and

we

it

but

in January, The House-

passed bill
"

.

guided by appraisal of the find¬
ate

convenes

tax

growth

stable prices, however,
be

t h

Senate,

of

will be alive when Congress re¬

more; freely

for

reduction

available

the

by

passage

iim¬

an

re¬

chance

favorable

less

'

of

management

in

Federal

roll call vote

a

on

cently, the measure appears to
have

De¬

Labor

the

and

Western

379 to 38

to

difficulties
the

a

Despite the fact that the pos¬
tal
pay-raise bill passed the
House by the lopsided vote of

snaking hard decisions in public

policies

ve¬

year ago.

It requires

job.

he

similar bill

somewhat

a

when

them

from under
toed

President

that

pulled the legislative rug

hower

conditions.

"Public policies must face up

who
still
Eisen¬

House

and

Senate

channels are contribut¬

economy

from

ulatory powers in the hands of
the states, at this session. There
are
numerous members
of the

on

investment

to remove con¬
the Federal Power

Commission and thus leave reg¬

the heels of
sharp increases in consumption
and

chance of passage

no

"gas bill"

a

trols

expansion of the Fed¬
Government
spending in
years,

cracking up—I

is

—U.

more

of

the rapid
recent

is

planning others during the Con¬
gressional recess during the late

Warn of Inflation Threat

eral

House

currently having hearings on
some phases of tax cuts, and is

Failure to deal with it
forthrigbtly will result in in¬
creasing hardships for millions
of people in this country.

committee

The

another.

or

Ways and Means Committee

omy.

The

boss

With

Federal Labor Laws and Agencies

this session

at

exemptions in one

tax

vide for

is

the

cut

Commerce

that would reduce taxe$ or pro¬

facing the American econ¬

grave

52%.
introduced

bills

lem

asked him for
in the profits and he told me to do this!"

think

77%. The corporation

as

There have been hundreds of

tion

a.

high

as

that infla¬

tee declared recently

"I

—

Research

Gale

The Federal estate tax now runs

the early fall.

The Joint Economic

ciations

American Asso¬

of

Encyclopedia

begin

incomes
of $2,000 and under.
However,
the taxes run as high as 91%.

commit¬

will be considered at a
tee. meeting in

Press,

Hopkins

Baltimore 18, Md.—
(Cloth)—$7.50.

of 20% on

rate

a

for^ Re¬

Development

Home wood,

some

taxes

income

Current

with

The factors

price-making.

and

time,

long

a

—The «Johns

members feel,

broad committee study

a

for

i

Bank

construction 'and

sity for tax relief has been ap¬
parent

V;'

'

-—International

Neces¬

country.

'

Economic Development of Jordan

during

man,

Y.—(Paper)—Single copies
request, additional copies 50e

N.

With

Street, New York 17,

East 42nd

cuts.

year

Seek Tax Analysis /'

A

—

Graphic Facts Book on the Iron
and Steel Industry — American
Iron- and -Steel. Institute,
150

back

was

Progress

;Steel's

Charting

j Many people have written their
j Congressmen and have button-.

is picking up

each month.

Congress has

tar,

will be taxes and the tax

uary

The vast highway con¬

struction program

of the

disappointing to many people in
reducing
spending.
Notwith¬
standing the lack of reductions,
members of Congress apparently
believe that a dominant issue
When Congress convenes in Jan-

•

corresponding period in 1950.
While
private housing is off,
construction in this field is still
heavy.

and may or may not

government regarding spending
during the 1958 fiscal year.

by Secretary of Com¬
Sinclair Weeks that 1957

be

pretation jrom the nation's Capital
coincide with
the "Chronicle's" own views.]

IM/

and the executive branch

Pre¬

—

»'

•

[This column is intended to re¬
flect the "behind the scene" inter¬

■

JL

i/U

JljL I

*

railroad investor.

v#

Capital

forms

added that

He

Washington...
(rem tbe Nation'*

of

transportation."
railroad^passehger service is
subsidized now
from the freight shipper or the

BUSINESS BUZZ

Behind-tha-Seen® Interpretation*

August 1, 1957

_

•

NEW YORK 5. N. Y.
TELETYPE NY

LERNER & GO.
1-971
•

*

•

•

'

-

Investment

10 Post Office

Securities

Square, Boston 9, Mass.

Telephone
FUbbard 2-1990

-

Teletype
BS 69