Full text of Commercial and Financial Chronicle : August 14, 1958, Vol. 188, No. 5768

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

RAILROAD

INDUSTRY

FEATURED IN THIS ISSUE

14

^si/vess

1958

VHli

Commercial

*

Reg. V. S. Pet. Office

Volume

Number 5768

138

New York

EDITORIAL

Gold Today
Princeton, N. J.

regular

President

news conference last week the
this to say about the problem of

had

Mr. Leon offers several

lem of

management and govern¬
all be concerned in this problem (of

think,

inflation);

curbing
branches,

no one

and I
could be

more

of

all

these

free

is

that because

to suppose

easy

man

a

"I don't believe this is

ever

true, and'the

its minimum

"this

is

near

market. Avers

serves

rea¬

required by

civilization,

our

Why does

important feature for the future of the laborer
pension plan, Social Security, pension plans
of the companies and his own insurance and
bonds, savings of that kind.

gold is
alone

is the

a

money,

use

it

as

Commerce

Commission,

in his

tional

deficits

their

in

traffic

for

the

railroads.

the final

we

the

With the pruning of costs ne¬
by recent traffic scarcity,
volume should bring sub¬
stantially increased profits

often

year.

cessitated

increased

are

countries

how rich

of

are

of

we?

......

cently enacted legislation. The repeal
of the 3 per cent transportation tax,
the

the. world.
What is the

fining of private carriage, should at
least
help to halt the erosion of
traffic now being transported by the

nicipal debts which, when added to
our
private obligations, far exceed
our national income? And is one rich who earns a dollar
and owes two? The true indice of our financial condition
is the status if our dollar which daily loses value.

Continued

NOW IN

afforded

a

on

page

tightening of the agricultural ex¬
provision, and the rede¬

emption

Rene Leon

going to remain a country without artificial con¬
trol, meaning that we are not going to try to go
into a Federally controlled economy, then labor
Continued on page 28

our

"Securities in Registration" Section,

A third

roads

to

hopeful sign is the determination of the rail¬
and improve their facilities. I had

modernize

Continued

28

Securities

BROKERS

and

STATE and MUNICIPAL

DEALERS

BONDS

RAILROAD

PUBLIC

CHEMICAL

&

CORN EXCHANGE

Inquiries

MEMBERS

NEW YORK 5, N.Y.

•

01 4-1400

Bond Dept.

To

t.l. Watson &Co.
ESTABLISHED 1832

Members

Investment

Securities

New York Stock

Stock

,

STREET

^QtUhtCCdt COMPANY
DALLAS




Markets

Banks

New

York

Stock

Exchange

Member American Stock

Chase Manhattan
BANK

Exchange

New York

Correspondent—Pershing & Co.

Maintained

and

Brokers

Commission Orders
Canadian

CANADIAN

CANADIAN
BONDS & STOCKS

For

Executed On AU

DIRECT

WIRES TO

•

PERTH AMBOY

Municipals

DEPARTMENT

MONTREAL AND TORONTO

NEW YORK

1 NORTH LA SALLE ST.
CHICA80

MUNICIPAL

Poxdhox Securities
Grpokatioti

Goodbody & Co.
115 BROADWAY

California

Exchanges

MEMBERS NEW YORK STOCK EXCHANGE

BRIDGEPORT

DEPARTMENT

THE

Teletype NY 1-2270

NEW YORK 4, N. Y.

-

Teletype: NY 1-708

CANADIAN
SECURITIES

Exchange

25 BROAD

FIRST

Active

Dealers,

Exchange

American

Securities

California

Associate

Net

r

Bonds and Notes

Southern

TELETYPE NY I42C2

COBURNHAM

Distributor

Dealer

E.D.T.

STOCK EXCHANGES

NEW YORK ANO AMERICAN

15 BROAD STREET,

on

Hope Street, Los Angeles 17,

Members

OF NEW YORK

Company

and

Public Housing Agency

BOND

THE FIRST NATIONAL CITY BANK

Burnham

EXCHANGE

Lester, Ryons & Co.

SECURITIES

CABLE:

•

Invited

California

'

FOREIGN

BANK
ST., N.Y

COAST

UTILITY

623 So.

Underwriter

12

Trading Hours
10:00 AM-5:30 PM

INDUSTRIAL

HAnover 2-3700

bond department

PACIFIC

MEMBERS

UNDERWRITERS

Municipal

30 BROAD

page

and

U. S. Government,

telephone:

on

State, Municipal

starting on page 38.

in

State and

Howard Freas

railroads.

REGISTRATION—Underwriters, dealers and investors in corporate
complete picture of issues now registered with the SEC and poten¬

undertakings in

...

Another favorable factor is the re¬

Federal, State and Mu¬

our

point

quarter of 1958 than those
corresponding period
last

the

of

constantly reminded from
Nation"
have the obligation to come to
aid of the "needy" and under¬

We

A

materially higher carloadings for

to

interna¬

payments: positions

railroad

management. These combined factors should assure in¬

abroad that, as "The Richest

sum

are

summer come

dence also of increased initiative on the part of

by their own economic mis¬
management. -

"Therefore, I think that, first of all. if we are

tial

passing of

Commission

encouraging signs
of commercial and industrial improvement. There is evi¬

caused

developed

SECURITIES

the

With

FREAS

Commerce

number of economic indicators

But

securities

Chairman, Interstate

creased

countries'

median of that whole process.

DEALERS

HOWARD

dollar loses value daily.

Only fractionally, for, were
otherwise, we would not be called
to extend foreign loans, credits,
grants-in-aid, etc., to balance other

at the

dollars

the economic outlook

on

for the industry as a whole and specific carriers.
These articles, especially written for the "Chron¬
icle" begin herewith:
' :
-

it

—

paying

suppliers, also of the Chairman of the Interstate

re¬

credit-system; decries International

upon

gardless of his wages, he cannot get back then
out of his pension dollars that are better than at
least the median dollar
he will get back the
dollars'-at the end of his inflationary period;
was

destroyed

balances?

beginning of* let's say, a 30 year period
work, but every year there is inflation, re¬

he

silver

treasury buy gold? Surely not because
for we are forbidden to own gold, let
a medium of exchange.
Do we use gold
as a settler of international payments

the

whereas,

of

gold, and reduced metallic

our

"Now, when he starts to make those savings
of

demonetization

and says our

industrial civiliza¬

tion, today certainly, has come to include as its

at

privileged to present today
opinions of the chief officers of a representa¬
tive cross-section of the nation's railroads and

debts; would control U. S. dollar's circulation abroad;
-

"Our whole

whole.

the

solely in the

Monetary Fund; asserts Treasury obligatory purchases
of gold regardless of origin furnishes foreign aid to
Russia; questions our state of wealth in view of our

that it is not true is this:

as a

The "Chronicle" is

price guarantee for gold and allow

useless commodity" to remain

silver's equivalence with

getting increased wages that he, through his col¬
lective bargaining process, is staying ahead of
the process or the progress of inflation.
son

prospects for individual roads and industry

recommeiicls^we adapt

to the former, advocates that the U. S. Treasury

as

cease

is labor.
"It

leading carriers
suppliers, also ICC Chairman, in articles especially
written for "Chronicle," outline their opinions as to

and

and,

concerned than

Copy

a

Chief executives of many of the nation's

regard to the latter, he favors free to fixed exchange rates

"I believe that labor,
must

angles of approach to the "prob¬

our monetary
and exchange policies to present: day conditions. With

inflation:'

ment

gold" and

Cents

Railroad Leaders View
The Industry's Outlook

LEON

RENE

Bv

'

As: We See It
At his

Price 50

7, N. Y., Thursday, August 14, 1958

40

Exchange Place, New Y ork 5, N.Y.

Teletype NY 1-702-3

WHitehail 4-8161

BOND

DEPARTMENT

Muttk of Atttctrtra
NATIONAL

300

"VS,naC! ASSOCIATION

Montgomery St., San Francisco,

•

Calif.

2

The Commercial and Financial Chronicle

(598)

The Security I Like Best

Brokers, Dealers only

For Banks,

If it's Over-the-Counter

•.

•

Try "HANSEATIC"

reasons

for favoring

(The articles contained in this forum

Because you can
.

This Week's
Forum

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

participate and give their

be sure of

they to be regarded,

are

Ruberoid

to

RICHARD

CLARKE, JR.

W.

Members:

System

Primary Market! in

American S. E.

and (Associate)

'

more

and

<

Vanden

secutive cash dividends each year

a

i*

ed

1,481,071 shares. There is
or
preferred stock out¬
standing or authorized.

Member

American Stock Exchange

CHICAGO

•

Wires

to

ended Dec. 31, 1957,

shows current
assets of $25.16 million, equal to
12

SAN FRANCISCO

•

debt

(3) Company report for the year

York 5

Teletype NY 1*40

BOSTON
PHILADELPHIA

by

no

Established 1920

WOrth 4-2300

represent-

is

Principal Cities

the

times

current

of

amount

liabilities, $2.10 million; cash and
government securities, $9.25 mil¬
lion, are more than four times the
current liabilities of $2.10 million,
company has expended
than $34,500,000 for plant
construction
a n d
rehabilitation

(4) The

during the past 10

RIGHTS

SCRIP

&

poses were

obtained entirely from

retained earnings.

(5)

Since 1917

The

common

Members

.

times

10

BROADWAY, NEW YORK 8

a^ut

gnd

obsolete

of the

past 11

that

with

needed

from

the end

year§.

.

$15.92

New

in

Liquid

Export a—lm porta—Future a

of

tn

company

leading manufacturer of
building
mate¬
rials.
In
addition, it produces
gypsum
wallboard, lath, plaster
and block, insulations, automotive
felts and boards, building papers,
insulating tapes, asphalt paint and
lacquers, waterproofing and fire-

originally in¬

New York

in

of

1886

asphalt

plants, and by

new

reached

their

ac

present

position in the building material
field.
felt

Ruberoid

mills

May

(one

1957),

operates

opened

will be

subject

of

asphalt

roofing

an

asbestos

mine, and

a

gypsum

A

glad to explain the
to

those

who

are

which

Ruberoid

sidered
omy.

In

activity

How

to

Use
was

Stock Options

or

total




nrkYtmn

being

number

STOCKS

in

decline

activity since

I

;

For current information

1948.

Call

write

or

-

,

'

_

Yamaichi

f

Securities Company

Mainte¬

of New York, Ino.

t

'V

greater

the

in

V

•*-

_:

_

.

-

share

per

favorable.

the

of BOSTON

the

MUTUAL.

corn-

SECURITIES ?
1956

81.07

1955

76.36

4.808

;

1954

82.13

4.292

.

3.25

(dollars!

,

FUND OF

76.42

4.511

2.90

3.13

9.25 r

liabilities

2.10

"'Includes

69.0

,

i ;

25.16

;

Prospectus

1.75
-*

65.6

BOSTON1

on

Request r

;

:

53.9

' 35.38

34.48

33.44

25.27

26.12

25.59

•9.54

9.48

2.40

2.40

9.89 i

.

2,27

12.0

cents year-end extra,

50

v

36.52

liabilities

:

'

64.6

sees,
(millions)
(millions):

+2.00

-

;

4.628

3.05

•

b +2.00

<■2.10

Government

Current

Investment Bankers

,

financial growth of

Cash

assets:

■

.

;;The following figures will show,

Current

Current

■

•

field for Ruberoid continues to be

pany:

.Tr

At

111 Broadway, N. Y. 6 COrtiandt T-5S8I

every,, year,

i

of

Tokyo, Japan
Brokers

nation

:

Affiliate

■

Yamaichi Securities Co., LM.

and
must be maintained in both good
times and bad, the outlook in this

earnings paid—
equity (dollars per sh.)
assets - (millions)
1.

&

efficiency.

homes

of

becomes

of

The

market

'V

11.1

io.9

GENERAL DISTRIBUTORS

KELLER BROTHERS

10.6

tlncludes 40 cents year-end

shares

has

high for

been

the

of
these
low-to. 49%

range

26%

CO., INC.

extra.

selling, at

is

out-

;an

.

and

,

'

(Cornor of Washington St.)r
Telephone Richmond 2-2530

,

Purchase.

OPPENHEIMER

In

'•

• -

recent

-

-

the

years,

*

"

~

AUTHORS WANTED

company

developed its Ethical Drug diviBroeck & Co., New York City ;
sion,
(Winthrop
Laboratories)
nil
u
Members: New York Stock
Exchange which has shewn particular sue- ■*/. K Y N
cess
with newer research
and American Stock Exchange
items,
I
Partner,

Oppenheimer, Vanden

-

t*

,

Whlih

Ar?}?n an<? Piaquenil,
"BPOrtant m

t[j.-

-

,

The

security I like best at this
c,
Sterling Drug Inc., a stock
which has appeal both for those
.

!Jt

]

Rheum.toid; Ar-^

thlPls and Malaria.

is

<

;

1

i

llnl I Ml Hi"'
*

•

York, N. Y—One of the nation's
,
st bpok publisher? is seeking bookkngth manuscripts of all types—iit'liort,
^

nnn^fiction

The earnings of the

nilM lOHTf!

f

~

time

?, MASS.

capital gams, and recommend its

■

\V. H.

about" 37,
.

.

March 31, 1958.
I believe that Ruberoid common,

•

ZERO COURT STREET, BOSTON

standing vehicle for income

1954 through
■" C

years

stantial

and

building

at

c a

noetrv

...1?

company

ities

and

repair

non-

work

—

The

Soecial attention to
—/

new

private

lot

nuaUy.

to

about

VlS
$la

bUMon^
billion

The social and

forces which

stimulated the

tion

than

or

more

an-

economic

11,000,000

erec-

that
a

qualities,

the

stock

has

still

/-■;

'

W.

oped profitably

new

Sterling Drug has

an

H.

over

Oppenheimer

the next few
coun-

drug

$1.50 last year against $1 in 1952.
In
recent
years,
the company's

dividend

payout

amounted

to

about two-thirds of its net earnings after taxes. Thus, a rate of

Milk

Powder

and

items

Through

various

have

other

enabled

conduct

over

its

successful

many

eminent

the

position; in

sfnTw bene?tstfrom
reluctance
sion-borne

to

incur high

rather

use

well advertised

of

^ces- .
many

doctor bills

well-known

drugs.

about

ably

and

38.

This

with

the

well-established

years.

proprietary drug business, the

people

'

Dividends paid by the company
have been steadily increased to

Tooth

to

s-

ird'i

uninter¬

as

operations

CU,

,

well-known $1.50 is my minimum expectation
Bayer Aspirin, Phillips' " for this - year, giving a yield of
of
Magnesia,
Dr. ,t Lyons about 4% at the current price of

items

:

rupted dividend ^record-since 1902.

hidden

and

;; rr"

between $2.50 and $2.75. per share.

selec¬

is

besides

the

i

?•

ing for about 70% of this increase.
I
estimate
that
current
year's
earnipgs will rise to a new -record

my

tion

f

Hollywood, Calif.)

up 11.2% from a year ago
earnings gained 9.8% to $0.64
share, domestic sales account¬

and

excellent

for

cago,

million,
per

reason

toiletry

housing has been the biggest facamounts

<

years- Sterling Drug is this
total
proprietary
total try s ,larSest
manufacturer.
Such

approximately $60

market,

fifty-eight first quarter sales
soared to a record
high of $54.9

the

over

Nine¬

teen

apprecia¬
tion
possibil¬

coni-

about 15% of Gross Na¬

this

compared to $1.32 in 1952.

p-

ital

will be devel-

builriW

and

Member.■£ Put & Call Brokers &

BArclay 7-6100

and

Stockholders'

company

198 Broadway, N. Y. 5

second,

'

construction

the

and

new
ew

valued

billion,

In

Dealers Assn., Inc.

nation
roofs

(millions)

econ¬

of

tional Product.

Filer, Schmidts Co.

I

value, in my
opinion, which

industrial

maintenance
on

offices

JAPAN
the

;were

rifip^ir. of I existing
the largest • market for
Ruberoid products in 1957, is of a
growing
importance.
Since
the

earnings (millions
Earnings per share (dollars)

a

con¬

public, private,

—

me c a
mercial

Ask for Booklet

1957

industry,

supplies, is

keystone

a

farm, farm,

interested.

^

branch

our

agen¬

homes,

Net

o

j

are

firm

our

are

NV1-1557

Mobile,Ala.
Direct wires to

the
Fed¬

and '

1957

in

mills, four asbestos-cement plants,

The construction

representative

;

companies

sharpest

production

longer term.

newly

11

seven

plant and mine.

worthy of investigation.

-

has, by expanding facilities

quisition,

Options

'

From that time the

building

Call

directly

government

1957

the

nance

half of the

sales

Percent

■

-

HAnover 2-0700

in 1956.
This improvement
largely the result of an ex¬
panded sales effort and increased

to

equally important
In
normal
times,

Sterling Drug Inc.

manufacturer

a

pany

and

than

Net

r

New Orleans, La.- Birmingham, AI&

share

company's
output goes into repair and main¬
tenance projects. Historically, re¬
pair expenditures tend to increase

en¬

a

paints.

sibilities through the sale of

are

Ruberoid.

man¬

nation's

is

as

pos¬

the
all

Wn hovAi/i

to

more

V

19 Rector St„ New York 6, N.

I

housing

new

be

important

in

Current

Company is one
largest producers
asphalt roofings and shingles

the

corporated in

The additional income

is

of

90%

work

nance

The Ruberoid
of

The company was

INSURANCE COMPANIES

to

'

-

.

DIgby 4-2727

INVESTMENT TRUSTS

to

7

York Stock Exchange

Members New

Net income amounted to $3.25 per
share as compared with $2.90 per

put on today are made of asphalt.
Repair, renovation and: mainte-

1957.

proofing materials.

PENSION FUNDS

building

popularity

85%

share at

per

asbestos-cement

—

is

in

despite

Ruberoid. Asbestos-cement sidings
have become the fastest growing

.

joys an able and aggressive
agement.

and

Refined

standard

'

.

was

Dividends

of

SUGAR

that

\

Steiner, Rouse I Co.

highest in the company's, .history

improved.

on

(8) I believe the

—

if

'•

New

,

industrial

large

•Sales

every

today's standard of shelter
a
greater number will be

and

the end of 1947 to $36.52 per share

STREET

hou^es betfome

demolished

are

state

and

cies,

nearly one million new units
year be built to keep pace

per

(7) Stockholders' equity has in¬

at

WALL

Co.,

consumers

and railroads.

Consequently, it is essential

year

'

creased

NEW YORK 5, N. Y.

300 00

or

serves

eral

year

a

only

.

company

family

dividends paid during 1957.

TEL. REctor 2-7815

LAMB0RN & CO., Inc.

rate of

The

tors.

earnings, as new building declines and this
of 5.6% on market has given Ruberoid a
high

yield

a

Exchange,

current

■

.

Members American Stock Exchange

States

formation is about 700,000

the common
shares have been increased in 10

Exchange

Stock

provide

about

(6) Dividends

Exchange

Stock

York

at

and

IfoPONNELL&fa

shares, listed

the New York Stock

on

sell

American

this is

years;

equivalent to $23.35 per share out¬
standing.
Funds for these pur¬

The

"

Bought—Sold——Quoted

*

today are
50,000,000
home

estimated

an

more

Specialists in

United

the

In

units.

since 1889.

(2) Capitalization

Corporation
120 Broadway, New

&

to be an

company

/ox

Put

■

of cities to suburbs and from one degree of sales stability.; Ruberoid
section of the country to another, products are sold nationally
excellent
investment and present some of All of these forces are still active through 20,000 distributors —
and are likely to remain active,
wholesalers, ^
the reasons for this
this

New York Hanseatic

Raw

•

accelerated slum clearance,*
shift of population from

opinion^

Associate

Broeck

York City. (Page.2)

high level of confer ^income,
government gttarattteed mort-

(1) The company has paid con¬

99

Louisiana Securities

W.

I consider the common stock

than 400 OTC Issues

New

Richard

—

v

heimer, Partner, Oppenheimer,

jndiided rapid Population growth,
gages,

Ruberoid Company

bouses from 1946-1957

non-farm

Richard W. Clarke & Co.. N. Y. City
New York Stock Exchange

Experience
Nationwide Wire

120

Company

Sterling" Drug, Inc.—W. H. Gppen-

Speed

Private

Alabama &

*

Clarke, Jr., Richard W. Clarke.
& Co., New York City. (Page
2)

be, nor '
offer to sell the securities discussed.)

as an

Participants and

Their Selections

.

particular securityr

a

intended

not

are

I'TTThursday, August 14, 1958

To

that
an

favor¬

compares

shares

drug

of

other

companies.

this must be added the
the

company

entirely

new

has

line

fact

N. Q. B.

i

OVER-THE-COUNTER

]

INDUSTRIAL STOCK INDEX
19-Year Performance oi

35 Industrial Stock $
folder on reqhwt

which'promfees ^o" become'Tn-

creasingly profitable in the future,
I

believe

that this possibility has

n°t been discounted in the
Continued

|

developed

of 'business

•

i

j

■

National Quotation Unreal

current

46 Front Street
on

■

-

page

33

New Yerk 4,

ILY.

Volume 188

Number 5768

.

.

The Commercial and Financial Chronicle

.

(599)

INDEX

Southern Industrial Growth
1

I

.

By on. frank j. soday*

;

....

Industry:
*'.■

•

■.

.

v;

•

Golcl Today—Rene

bright future predicted for this area's economic activities.

The Business Outlook—W. Lr. Leavitt and

He

excellent position to

an

markets.

new

"Blimey! The King's English

R.

Jung

6

9
99

Outlook

for Mortgage- Financing1 in Nation's
Economy of
Today—Walter C. Nelson—
__!

Wages, Prices and Productivity—Ewan Clague__

the country

Best-

are

within the next decade providing plentiful favorable-growth factors are used to fullest extent.

clipped

those

as

Obsolete Securities Dept.

"

Believes

as

obsoletes."

7

Investment Problems in Decedent's Estates
—Russell A. Hunter—
l_

capable of supporting an industrial
expansion which could make it the most prosperous region in
resources

is almost

with

v

.

South's

C.

LONDON

3

The Corporation's Relationship With Its
Owner-Stockholders
—O. K. Burrell

look forward to becoming

dynamic growth industry as it is in
expand its operations and develop

AKD COMFAKY ]

—Cover

Southern Industrial Growth and the Textile
Industry
—Frank J. Soday
_!

,

of Southern industrial and agricultural
growth is unfolded and broken down into its principal components by Dr. Soday to show tremendous progress made and

a:

l

Leon—
—

The whole panorama

the textile industry can again

Page

■

Chairman, The Southern Association of Science and Industry

asserts

LicHTfnsTfin

B. So

Articles and News

And the Textile

t

3

WALL

STREET, NEW YORK

Telephone:

10

WHitehall 4-6551'

10

„

"Buys"—Roger W. Babson!—.!___„—13 i

REEVES SOUNDCRAFT

Fannie May's Weoman Service—Hugo Steiner._____ 1—15
v

When the Southern Textile As¬

sociation

formed

was

fifty

of

ago, .37%
of the cotton textile
mills of the country already were
located

period.
and

the

in

the

Due

living

to changes in style I•
conditions, * garments

V., Each jof

.

spindles of the'
are

in

the South.

This

of

of

ment

textile

the

South

at

pro-

vided

enDr. Frank J.

jduring base

Hollowed

jmills,

by

and

tfiber

wool

mills

Irecent

and

rayon

and

have

years.

added

and

in

to

56%

in

1957.

lack

any

By 1939, 35% of the

of

interest

portant .field

in

i

The

southern

country

ity

textile

An

elapses

and

industry

the

At

($26.5

result

•kept

pace

dustry

as

size

■

5Va

has

times

increased

since

1939,

search

in

while

southern

industry
has
in./creased in size seven times in the
same period. For the country as a
I whole,
manufacturing
has
in:

creased

.in

5%

size

times

while

the textile
has increased by 3 Mi.

1939,

This

.

is

a

reflection

an

fact

that the proportion of the consudollar devoted to textiles has
of

in favor

capita

consumption of fibers has
by only 12% since 1939,
equivalent
to
1M>%
per
year,
increased

'while the per capita consumption
!

address

*An

Southern
:

,bv

Textile

Soday

Dr.

before

Association's

Golden

.....

....

Bank of New York "Letter" Cites End to

Decline

the

•

of

basis

is

one

reason

We

See It

1

'•*

"*..*■

»

■ ■■

■

■

<

Business
•

Fortunately,

textile

the

made

bolster

to

the

Conference

From Washington

Funds

!___——

——

Banks

About

and

Reporter's Report————.—

on

May--—".

!

*

-

"

Boston




v

Chicago
..

„

•
.

—_

The State of Trade and

Washington

and

Witco Chemical

Corp.*;

;—

B.

DANA

Park Place,

25

Patent

*

48

•

Copyright 1958 by William B* Dana

•

*

Epsco, Inc.
Prospectus

on

Request

Company
»

Reentered

ary

8.

IT.

Sulphur

5

i

You.

Pan American

2

FINANCIAL CHRONICLE

-

16

Industry

The COMMERCIAL and

Reg.

Office

25,

as

second-class matter Febru¬

at

1942,

the

post

office

at

♦

New

York, N. Y., under the Act of March 8', 1879

COMPANY, Publishers

Subscription

New York 7, N. Y.
to

9576-

HERBERT D. SEIBERT, Editor &

"

-

1

Publisher

WILLIAM DANA SEIBERT, President

Rates

Subscriptions in United States, U.
Possessions, Territories and Members

of

Pan-American

W! V. FRAVKE1 4 Cd

in

Union,

$65.00

per

Dominion

$68.00

Other

per

of
Canada,
Countries, $72.00

year,

per

8.

INCORPORATED

year

39 BROADWAY,

year.

NEW YORK 6

^

Thursday, August 14,. 1958

Glens Falls
-

(general news and ad¬
vertising issue) and every Monday (complete statistical issuemarket quotation
records, corporation news, bank clearings
Every

.

*6tate

-

Thursday

and

Other

city

news,,

Offices:

135

South

3,. 111.

Bank

$45.00
j

La

Salle

St

(Telephone STate

2-0613)

and
per

year.

be

(Foreign

-

Monthly
Postage extra,)

in

of the fluctuations in

New

York

& 4041

—

of
exchange,
remittances for
subscriptions
and
advertisement*
made

3-3960

Teletype NY 1-4040
Record

rate

foreign
must

WHitehall

Publications

Quotation

Note—On account

the

etc.).

'

Chicago

'

42
31

—

and You—By Wallace Streete

;.

.

Security I Like Best.!

The

24;

1

Worcester

Specialty

Ling Electronics

38

-w.

;

Prospective Security Offerings—I

The Market

Dallas

23

Securities Salesman's Cover

TELETYPE NY 1-5

-Schenectady

'

.

:

Nashville

Electronic

33

Securiies Now in Registration—

-

-~Y Albany

Angeles

Radorock Resources

43

Other

';

Los

Chicago

29

Securities

Railroad

„

4

—_

Securities

Utility

Philadelphia

12

Governments.

25 broad ST., NEW york 4, n. y.

;

Direct Wires to
Francisco

San

'16

—

Bankers

Reporter

•

TELEPHONE HAnover 24300

Teletype NY 1-1825 & 1-4844

11

Ahead of the News—Carlisle Bargeron—6

Wilfred

WILLIAM
•

8

inc.

40 Exchange Place, N. Y*

HA 2-9000

Eve of

on

—

Our

V
will assume a more commanding'
position in the research field. The
page

8

44

Public

months lend encouragement to the
view
that
the
textile
industry

mackie,

&

48

Observations—A.

of

Singer, Bean

30

—

46

•

on

:!____

Mutual

Developments during the past few

Continued

Preferred

Reeves Soundcraft

Cover

—

Stocks

Indications of Current Business Activity

the industry in the research field.

Members New York Stock Exchange

-■

Common &

47

Our

Spencer Trask & Co.
:

L-O-F Glass Fibers
Eastern Industries

37

Pressure"

REctor 2-9570

1

37

Man's Bookshelf!-

Autumn

for

•

—

Pacific Uranium

Board

Einzig: "Sterling's Continued Firmness

DfCC D D Clt OTflPlf C
»

Ampex

35

Dealer-Broker Investment. Recommendations

indus-

position

&

City

31

Coming Events in the Investment Field.

try is well aware of this problem
and determined efforts are being

.

i-

Salt Lake

•

v

*

(Editorial)

Bank and Insurance

riLLfC 1111X11 ulUUItO

?

Other

Denver

to

Regular Features
As

News

have
"

Overlooks

City Bank "Letter"!—

initiated

work

HEnderson 4-8504

wires

-

the total research
billion. With re¬

n

j

30

initiation of

marketing

For many years we

»

Direct

-

years ?

expenditures

even

Exchange PL, Jersey City

DIgby 4-4970

15% Below 1957, According to National

Published Twice Weekly

specialized in

29

Council.—

Trade

National Industrial

■

as

Anniversary Convention, Ashevilte, North

.Carolina.

Foreign

.

N ST A Notes

-

•

same period
other items. The per

Lake City Stock Exch.
Spokane Stock Exchange '

1

Corporate Giving Rises With Shift to Education, Reports

prediction made some time'
by one of the authorities in
the
field
that the
proportional
expenditures on soft goods will be
down by 2% by 1965.

,mer

\ decreased during the

Exports to
^

ago
.

the

Members Salt

Optimistic Growth Study of Los Angeles Compiled by
Robert S. Dockspn.-—

the

since

industry

of

J.F.Reilly&Co.,Inc.

on

23

M. Weidberg Says Franz Pick
Important Factors vLetter to Editor)

now
three high, in 1965 we shall
have an even greater competition
in the market place. TheTaet that
the textile industry has not been '
able to compete in this field on '

times

"

all

Slow

Way to Ease U. S. Debt Problem Analyzed in First National

research

1951, when
bill
was
$2Ma

no.t

with the growth of in¬
a whole. The southern

textile'industry has

of

in

it

time,

same

Congress Go

Dr. Joseph

im¬

products resulting from such
The new products on the
market today competing for the
consumer
dollar are largely the

billion) in the nation.
,1

Urges

11

work.

($10 bil¬

the fifth largest

Boston

Security Amendments--

the

The combined tex-

second largest

and

of

—

over-capac¬

seven-

between the

research

Bank

Teletype: JCY 1160

-

of

average;

23

Guaranty Trust Co. "Survey" Hails Study of Full
Employment Act

foreign com¬
industry has had a
in maintaining its '

major industries.

23

Declining Corporate Profits-.;

position, and its profits have not »'
kept pace with those of other;

!tile-apparel industry is the South's
lion)

the
time

FORTUNE PETROLEUM

22

_—■__

Cobleigh Get "Man-of-the-Year" Award

First National City

■

increasing

and

petition,

by

industry
■includes 2,400 mills, 600,000 em¬
ployees, and produces goods valr«|ued at $7
billion.
It is the
South's
fourth
largest industry,
.and ranks eleventh ($1.3 billion)
in the nation.

'

the

on

difficult

the

of

this

16

Securities Column

National

Social

-

average

an

U.

First

•

in

Plagued with

means.

The

South should have 65% of the texr-

industry

Ira

part of the
textile industry, but only lack of

in

was
47%

whole spends

1958—

by Association

,

v

textiles, the research picture
a bright one.
While indus¬

as a

Act of

CORRUGATED PAPER

,

of 2% of sales annually on re¬
search, the textile industry spends
only 0.1%. This does not re'flect

acetate

^country's textile industry
ijthe South, increasing to
4947,

try

were

synthetic

been

'

FT.> WAYNE

4

William T. Faricy to Receive Transportation Award

is not

built

Cotton mills

'

Praises Transportation

American Railroads

Railroad

grow¬

industrial

our

,

hi

southern

since that time.

bers.

Soday

which
industry has been

upon

of

segments

of

development,

1939; the amount spent in this
activity during, .the current year
will exceed $8 billion. The prod¬
ucts of this work are reaching the
market in ever increasing num-'

the

islrong and

and

of the fastest

one

Loomis

Cobleigh—

New Railroad Legislation Summarized

in

the

century

is

Daniel P.

Starting with an annual
expenditure of under $1 billion

the

of

turn

Red and Black Rails—Ira U.

economy.

the

into

research

ing

indus¬

us

new

which

move¬

LITHIUM CORP.

(Articles especially written for the "Chronicle") —_Coverf,

.

is faced with a host
products competing for a
share of our spending money. The
majority of these are the products
of

cotton;

About the Railroad Industry

■\

Railroad Executives Discuss Industry's Outlook

have becbme lighter in weight and
more casual in style.
;

country

EQUITY OIL

important V

Today,

some

itile

other

80*%* of

area.

try

number "of

a

items has doubled during the same

years

funds.

'

"

'

'

"

Direct

Win to

PHILADELPHIA

'

l

4

The Commercial and Financial Chronicle

(600)

Presently the rate is $3.60 regu¬
lar plus a 40c extra paid at the
1957 year-end. It seems probable
that
this $4
total will be paid

Red and Black Rails
By DR. IRA U. COBLEIGII

Some sideline comment

debits and credits in the railroad

on

picture today; plus notes about a few
railway equities.
In the late

got hit so hard and so fast
the rails. The first quarter of

1958 reveaVd

wnacking drop in

a

both gross

that

not

is

best

even

been
a
moderate
improvement
in
railroad carloadings. For instance,
the week ended Aug. 2 carried
has

trafficked and
best

could

al¬

escape;

loadings to 622,204 cars,
up 2.4% over the previous week,
but still down 16% from the cor¬
freight

though some
were

hurt

more

than

others.

To

the

of

February

alone, Class I
carriers

lost
Cobieigb

million as
against a net
:
profit of $48 million for the
$9

month

1957;

months

two
net

in'

of

of these

91%

was

period.

•

.

1958

first

together, the

Class I carriers

same

353,012 for thePennsylvania. (The
ur broken Penn
record of paying

same

for the

and

in each year

dividend

some

1848 is in

below the identical 1957

This is not

were

For

since

apparent jeopardy.)

the

troubled

more

roads,

dip in earn¬ improvement
must
be
found
ings; it's more of a collapse, and through tighter cost controls, more
has been followed, as you know,
aggressive
freight
solicitation,
by a veritable procession of divi¬ further abandonment of high-def¬

dend

by

a

reductions

arid
omissions;
layoffs
and,
in
instances, 10% salary re¬

substantial

many

ductions

At

little

a

Pacific

paid

revenues

the

of

the board for

across

non-

operating personnel.

fairly prophetic

icit

passenger
lines,
local
tax
relief and, quite possibly, mergers.
Not since 1928 have we heard so

these

of

was

gloomy

events since it racked up the lows
for the rail list in December of

mentioned:

mergers

many

Central

York

New

Actually^ the steels market

events

vania;

and

Central

&

Hudson;

Pennsyl¬

Erie

Lackawanna,

Delaware

The
and
and

Frisco

of

Pacific

logic.
of

the

formances

has

very

best rail
in

turned

interest and

demonstrated

that

feel

but

Many in¬
they were to

if

rail

one

Report" significantly titled "What
the Stock Market Is Betting On"

stock, it would

Railway
is
performer in

resolute

For the first six

year.

articles

ous

another
a

rough

months it

vigorously

have

we

urged the principle that the raise
d'etre of the stock market is to

on

provide
not

a

facility for

liquid

a

transfer

Southern

In previ¬

(Emphasis is supplied.

Union Pacific.

be

S. News & World

rent issue of "U.

dividends.

vestors
own

of

forum

placing

the future of business or

Embodied in the article

the

values,

investment
for

bets on
politics.)
inter¬

are

share against $2.57 views with top executives who
present earnings guide investment company port¬
flow appears sufficient to assure folio activities; asking how they
the $2.80 dividend and the terri¬ interpret recent and current mar¬
ket
action, with, of course, in¬
tory served is one of the most
rapidly growing industrial sec-, clusion of some prediction.
earned

$1.99

1957.

for

a

But

Georgia; Missouri Pa¬
&
Pacific, etc.
last year; but since then has been
But, unlike 1928, merger rumors
pegging away at plus signs so are not currently accompanied by tions of the nation. At 47 the in¬
Exemplifying predilection
for
that
sorie
issues
have
already jazzy market run-ups in the sub¬ dicated yield is 6%. Management "market swing-catching in lieu of
scored notable comebacks. For
ject shares. For instance, nobody is eager and cost control excel¬ embracing
a
long-term
valueinstance, B & O has moved from rushes to buy Central because it lent.
based position, is its report of the
a
1958 low of 22% to a
high of .may merge with the Pennsy; or
exchange
with
the
Southern Pacific is another rail following
38%; Seaboard from 21% to 33%; vice versa.
with a lot of extra curricular ac¬ head of a leading fund:—
and New York Central from 13%
There
are,
however, quite a tivities,
"Q.
How do you feel about
including
investments,
to 20.
All of which suggests, to
few lines that should turn in quite
pipeline income from rights of buying opportunities in stocks, in,
investors in the market at
least, creditable results this year. We'll
way and over five million acres say, the next three- to six-month
that wails about the ailing rails
mention a few with a word oq of land
delivering increasing pe¬ period, compared with now?"
may have
been a bit excessive.
cific

and

Texas

two of comment about each.

These

wails, however, did fall
sensitive ears in the Con¬

upon
gress;

so

major

much

revision

Commerce

Act

law.

came

the

of

Transportation

that

so

Smathers-Harris

first

equipment purchase,

beefs

of

all

and

for

and/or

The Act further

abandonment

deci¬

sions; and by tightening ICC con¬
trols over private
carriers, and
the haulage of certain farm
prod¬
ucts.

The

ciple of

Act

introduces

abandonment

a

prin¬

of

heavily
losing passenger service where its
continuance

creates

and undue burden"

carrier.

And

rently.

"an

on

unjust

the subject

with

2,547,000

and

debt.

$477
It

common

million

in

Stock at 52 yields 5.8%

to

save

rare

around

Other

rail

accounting

unincurred

a

share

in

classification

losses!

The

stock

a
—

at

37% is down from
58%.

Chesapeake

&

Ohio,

Denver

&

$2.50

was

a 1.957 high of
paid in cash divi¬

elite status

they enjoyed 30 years
Even with all the dieseliza-

tion,

attractive.

more

that

I

think

lower

That

certain

and

be

they might
means

stocks

a

most

might
attrac¬

tive

purchase at the proper time
kind of stocks
to buy are those connected with
the cyclical industries—steels, ob¬
viously, and other forms of heavy
.

.

the appropriate

.

industry, [sic] I am not yet ready
buy railroad securities."

to

Another
that

"the

fund

manager

market

is

agreed

betting

on

a

in business, and that is
good bet."

recovery
a

and other improvements in
operational and maintenance effi¬

oils,
which had been liberally
bought during the first half as
they were last year, a turnabout
sentiment

in

From

others came tieing of the

market's action to the immediacy

such

on

unex¬

an

pected and significant occasion as
the Iraq revolution would be rea¬
sonable and logical.
But in this
instance, while our survey natur¬
ally shows some reduction in in¬
of

view

long-

situation

the

has

manifested.

singularly

But

the

enthusiasm,

vestment

after market

funds chasing

fluctuations, and the news, does
take place in the case of many
individual industries.
show

the

that

textiles

and

oils,

were

Our studies

rails,

sold

on

metals,
balance

by them during the March quar¬
and then bought on balance,
during the succeeding June quar¬
in market

ter,

ter and its improvement

prices and reported business

pros¬

Utilities
similarly
were
liberally bought oh sizable price
advances,
after
having
been

pects.

liquidated
during
the
previous
quarter.
Some
issues
in
the
cyclical copper industry, which
had been sold without any off¬
setting buying ;during the first
quarter, were liberally purchased
after

Ford

of

onset

the

still

the

motors
Chrysler, which

and

In

recovery.

depressed

area,

had

been

bought during the earlier
period, were liquidated in the
succeeding
interval
of
falling

production,

earnings

divi¬

and

dends.

Comparative

Group

Performance

intra-market

The

action of in¬

dustry groups since the beginning
this

of

year, with the relatively
performance of the cyclical

good
or

vulnerable industries, confirms

the

general short-term marketapproach.
This is so,
though
during
this
re¬

business
even

cession

period

investment

the

community has shown unusual in¬

refraining

in

telligence

from

following the economic news.
Such

the star
the textiles
equipments
(35%), rails (34%), steels (33%),
autos (32%), coppers (27%) and
papers (21%)—against a 20% rise
by the market as a whole.
Per¬
forming
worse
than the whole
market have been the relatively
stable public utilities,, chemicals,
oils and telephone and telegraphs.
among

groups

performers include
(up
37%*),
farm

Autumn, the market will drop in
reflection of resulting disappoint¬
ment, with another definitely ex¬
pecting
better buying
opportu¬

Among the cyclical issues act¬
ing well, and favored by fund
portfolio managers through the
first half of the year, were the

currently.

nities in the Fall.

rails, steels, and coppers.
Inci¬
dentally,
the
rubbers
and the
electrical equipments, sold by the
funds, were groups which showed

Stock

sold

at

50%

in

1935.

bites

of

Norfolk

continuous

and

Western

dividends

has

since

paid
1901.

6%

to

7%%

So

Vilas & Hickey

by

cost

the

Exchange

(with one
respondee asserting that if busi¬
ness
doesn't
improve
in
the

Also among the
cited

of

been

around

here

still

the

MUNICIPAL

and that
more

PUBLIC UTILITY

and

credits,

backbone

of

our

RAILROAD

carry

the

SECURITIES

they

cars

a

to

trans¬

revenue

pipeline has
★

BROADWAY, NEW YORK 4, N. Y.

ized

in

from that

Further,
ever

addendum

truck or
been immortal¬
no

song—there's

don

Choo Choo"

or

you'll

par¬

the expression, "Sweet Soo."

management
the

over

years,

"Chronicle's"

the

views

all

of

Policy

a

whole

as

as shown
quarterly

by
re¬

portfolio operations,

been very sound in desisting from
investing policies bound up with
chasing the market up and down.

always add ten
freight train and Thus,
high percentage of rived
can

nothing to
compete with "The Atchison, Topeka and The Santa Fe," "Down
on
the Lehigh Valley" "Chatta¬
nooga

has

Fund

Long-Term

Fund

a

very

down to net.

Overall

and

portation system; that they have
powerful friends in high places;

Brokers in

esti¬

mates about the degree of defense

a

loss during the period.

net

Performance
In

a
long while, and
stay; that they are

to

profits;

a

Abroad

term.

wind up with an assort¬

debits

are

by
each worker. spending, .and other action
industry $185 government, including the short-

the conclusion that the rails have

are

★

a

annually.

we

ment

first $400

the

on

earned

may

million

INDUSTRIAL

business recovery,

a

featherbedding, escalator
short-term
criteria
contracts, and, now, the
threat of a pension tax boost from prospective rise in
month

York Stock

of

union

This




weathering

this year would include Seaboard,

ago.

be

think

should

I

.

of the international

case

ciencies, the rails have to meet
dends last year.
tough competition from mammoth
If the ..record grain crop lives
truck-trailer
units,
highballing
up to its billing, Rock Island at 28
along
on
new
congestion-free
may prove somewhat underpriced.
superhighways; from a completed
The dividend has been reduced to
St. Lawrence Waterway, and the
$1.60 and should be maintained
inland waterway network; from
there, providing a yield of 5.7%
pipelines; not to mention the cost

addition to this
remedial legislation
strengthening
the
competitive position of the

26

issues

is

$2

"A.

sell

operating in Rio
Grande
and
Kansas
City
black, should earn $5.25 this Southern.
(against
$8.53
for
1957).
In
spite of all the favorable
Moreover, by
discontinuing its items presented in the foregoing,
New York-Washington passenger
the simple fact remains that the
runs, it is in a position annually
rails, as a class, have lost the

in

Members Neio

cur¬

year

up

rate

year.

the

the powers of ICC by
giving that agency the right to
overrule state regulatory boards
on

situated.
leverage

preferred
funded

dividend

$3

revenues.

should be earned nearly twice this

favorably

shares preceded by $60 million in

guaranteed loans

for maintenance.

a

the

railway financial relief per¬
mitting up to $500 million in

new

O

be¬

offers

government

troleum

&

powerful

most

packs

B

wallop,

so-called

Act

appears

It

lines,

1940,
1958,

of

This

first

eastern

Interstate

since

Act

the

the

Of

the

In

con¬

iii the featured article in the cur¬

than enough fo pay all bond

more

this

cept
is
now
strikingly

ivt«*y

market

of the June quarter.

been

in

Wuliea

alone last year were

revenue

periods of the
break of last
Fall, as well as the succeeding
15% market rise through the end

management

this

the

included

100-point

term

For the first six months per

lail

has

fund

by Union

been

echelon

mutual

per¬

far

so

the

even

high

115.
of

The

involvement

sells

common

of

well

as

theoretical

as

oil

TXL

actual

course

in the company treasury.

&

One

year

by

the

1957.

below

shares

105,196

around

in¬

kicker here by virtue of

a

Texas

continued
validation

last

10%

only

There's

places, in the
face of its

®

higher price, Texas
a
sturdy look. It

share

the

econ¬

in the highest

even

has
a

mar¬

on

the

and

year.
Its
for the first five months

$8

were

betting

business

of

persists

omy

Pacific.
share
net was $1.25, down only 18c from
the
same
period
in
1957.
The
dividend is $1.20 regular, plus a
40c
extra
and
it appears
both
should be paid this year. UP has
long been a rich road and its non-

$4,962,496 for
Haven; $25,565,920 for
the New York Central; and $25,deficits

thdf New

'

forum for

a

f\

common

half
U.

ira

concept of the stock

as

rails.

tive

&

ket

course

yields

rate,

.

.

THE SHORT-TERM MARKET APPROACH
The

of the least specula¬

One

roads have been hardest hit. First

be

month

regular

$3.60

5.07%.

responding week in 1957. Coal
and
grain traffic is picking up
but there's nothing in sight in the
way of tonnage to make
1958 a
good railroad year. The eastern

for

specific,

the

recently

week-to-week

managed

lines

railway relief; but legislation
no substitute for traffic. There

lor

Thursday, August 14, 1958

By A. WILFRED MAY

$40 million in net work¬

over

ing capital, and is progressing
rapidly toward complete dieseli-

indeed, been done

So much has,

and

net

has

attractive

more

rails, the 3% excise tax on freight zation which should, within two
transportation was repealed as of years, add around $1 a share to
net earnings. At 71 the stock, on
August 1.

recession, few indus¬

tries
as

of the

.

Observations.

again this year out of ample indi¬
cated earnings of around $6. Nor¬
folk and Western is well managed,

Enterprise Economist

.

.

tions
the

the

composite picture de¬
the periodic tabula¬

from
of

the

relative

holdings

category of cash,
investment grade bonds and pre¬
ferred stocks, and of the "aggres¬
sive"
area
of
common
stocks,
which

stood

at

the

of the trusts, as our previous in¬
quiries have shown, shifting of is¬
sues within portfolios generally is

quite active, with results

conservative

proportion of 80-20% at the mar¬
ket highs of 1956, was preserved
practically intact ever since. This

not too

impressive.

With "gearing," or
leverage from senior securities, in
the trusts' own capitalization ac¬
centuating the swings in their
own

common

shares'"

net

asset

value,
the

their
performance
over
years has fluctuated around

the

course

in

"defensive"

Britain, the traditional home

indexes.

study
the

of

*As

the
is

recent

current

omist"

of

This

leading

share

confirmed

in

performance

issue

of London,

of

'The

Econ¬

with the

compiled by Harold
Hemphill, Noyes & Co.

a

in

con-

Clayton

of

Volume 188

Number 5768

"The

elusion

boom land

slump have been

ficult

the

for

trusts

investors and

much

Steel

"'V'

The

they have not done
if at

better,

The

to

other

Output

Retail

State of Trade

G. Harold Pearson Now

Auto

and

Industry

Price

Pearson

with

has

—

■

;

J,

.

: ..

>

.

,

.

If the current trend continues, August may be as
month as June, when order books were swelled by hedging
against the expected price boost. At worst, August will be second

rise in prices.

Improvement continued the past week to be reflected in the
current statistics of business and industry and while the "metal-

Co.,

&

hurry to move prices up.-

Meanwhile, the steel market continues to improve despite the
good

..

associated

become

Dempsey-Tegeler

any

be in

This market is depressed, and no one seems to

rail prices.

J

Harold

G.

generally will rise,
but for the moment
for steel

Also uncertain is the outlook

the situation is confused.

Business Failures

»

price of stainless steel plate

cut the

raises the question of whether stainless prices
"The Iron Age" stated. Chances are they will,

Index

Production

(Special to The Financial Chronicle)

J

..

U. S. Steel's decision to

Dempsey-Tegeler
Colo.

president of a steel mill
"Business is being placed.

provement."

Trade

Commodity Price Index
Food

DENVER,

say:

Carioadings

investment funds."

With

Production

Electric

all, than other

a

A still further pickup is seen in September,
will really begin to take hold.

when

working industry is not out of the woods yet" as The Iron Age

only to June.

phrases it, this trade weekly continues by stating, "many metal-

automotive orders

working firms are better off today from a new order standpoint*
than they were several months ago."
;

'"Every single product shows an improvement,", says the presi¬
company.
He expects August to-be a better month
thsin June. Another mill says August .will be "a shade under June.

industry set a new all-time high
second consecutive week, while
carloadings in the latest reporting week (Aug. 2) increased 2.4%
above the previous period.
In the automotive industry, notwithstanding widespread closedowns-To permit factory^changeovers
on new models, output in the week ended Aug. 8 advanced somewhat.
Trade volume the past week also expanded and was T%
to 3% higher than a year ago, according to Dun & Bradstreet, Inc.
Last week the electric power

level

of

kilowatt

output for the

:

dent of one

Both

mills

r

;

Midland

and Commerce

.

Building.
Mr.
formerly with Low-

The

Savings

Pearson

was

-

-

On

"Ward's

last,

Friday

Mountain

dent

of

rities

the

in

Corp.

month would

have pushed

v-'7

'■•••:4'

■

drop did not measure up to the expected decline,

unemployment rose from 6.8% to

the seasonally adjusted rate of

Secu¬

States

expected

by about 500,000.

Because the

Executive Vice-Presi¬

was

The rate had dropped below 7% in June for the first time

7.3%.

since the recession began.

Employment

Financing Planned by
Banks for Cooperatives
A

of the

trust debentures

collateral

Cooperatives is being
for next week, accord¬

will

debentures

These

"The

offered

agent

130

of

ance

a

>

reported as
operations.

all other manufacturers prepared

Planned last week were 66,425

for

1959 model

automobiles and 15,138 trucks

trucks the week before.

"Ward's," widespread factory closedowns will,
hold August car production to a programmed 178,000 units, 45%
fewer than July's total of 321,053. However, this month will see
the start of 1959 model outturn as Buick and Imperial plan to
to

According

get under way Aug. 18 and Rambler a week
This
model

agency

runs

are

later.

added that
despite the fact the end of their
approaching, Chevrolet and Lincoln, were on

last week. Chevrolet's Flint,

Mich., Janesville,

car-making units and Lincoln's Wixom,
Mich., factory were scheduled to work last Saturday.
Closing down for changeover • the past week was Plymouth's
'".tContinued

on

page

automobile

industry

continued to report small job
indications of job strength among

with the assist-r
nationwide group of

City,

joint survey revealed.

States Department
unemployment compensation lists
dropped 132,600 to 2,422,800, the largest decline of the year. It
attributed this to resumption of work in some plants that had
closed for summer vacations to seasonal upturns in food and
apparel industries, and to the number of idle workers who ex¬
hausted their jobless pay benefits. These totaled 275,000 in July,
of

William Street,

Knox,
York

-New

machinery industries, reported less than seasonal cut¬

the

For

of debentures
through fiscal

issue

new

some

producers of automobile components," the

13 banks.

be

in various parts of the country
farm and other outdoor work."

rains

some

reductions although there were

$49,500,000 of 5% debentures
maturing Sept. 2, and for lending
operations. These debentures are
the joint and several obligations

will

May-June-July combined.

these industries.

the

This

declared the changes were not significant

of 660,000, some 118,000
August decline that mutches

stocks

Assembly plants of Chevrolet, Plymouth and Ford Motor Co.
continued to turn out 1958 model cars the past week, "Ward's"

backs, the report showed. Employment levels are watched closely
in durable goods because the recession has largely centered in

this issue will be used to redeem

of the

model inventory cleanup outlook

Wis. and Tarry town, N. Y.,

is

sale of

proceeds from the

The

the cutback in

overtime programs

metals and

They will mature in seven
months. The Interest rate will be
announced about Aug. 19.
at par.

"

period last year

same

tistical agency declared the 1958
remains favorable with Aug. 1

changed

sold

be

were

but in the

agencies continued.

banks.

the

"heavy

optimistic developments in mid-July, the
Employment in manufacturing, at 15,165,000,
negligibly from mid-June whereas a moderate decline
usual.
Durable goods industries, particularly the fabricated
There

ing to John T. Knox, fiscal agent
of

that

noted

apparently curtailed

13 Banks for

arranged

was

The two departments

and

expected 13% under June,
the decline was 20%. The sta¬

compared to 62,846 cars and 16,276

by 198,000 to 65,179,000 at mid-July but this
not as large as the ordinary seasonal

rose

too,

change, the agencies pointed out.

$82,500,000

of

issue

public

improvement,

T":

'

below like 1957 and earmarked1 for an

143,000 to 5,294,000, the joint survey noted.

was

change

. that
July 11-20 ;
month to

Automotive; Reports", noted

Average July daily sales were an
;

reported.

decline

usual

idleness down

ell, Murphy & Co., Inc. and prior
thereto

The

largely from miscellaneous

July 21-31 new car sales showed a sharp'12% Mse over
with a daily rate of 14,640 that carried the entire

347,500, or 13,365 daily.

_..G. Harold Pearson

gain "com£s

the

say

with some help from automotive. \ Backlogs of orders are
moving out steadily, concludes "The'Iron"' Age^V 'r,
>

users,

Turning to the nation's employment field: it is noted that
unemployment fell 2.6% in the month to mid-July when a 10%
drop is normally expected, halting a two-month improvement in
the nation's job picture, the United States Departments of Labor
■:.

Labor

week

ended July 26, the United

said, the number on

the agency

said.

'

security dealers.
.T

:

for

banks
income

.

the

in the like week, the number drawing unemploy¬
dropped by 67,000 to 1,230,600. Forty states
shared in this year's decline, led by New York with 25,700 and

them

are

Michigan with 20,500.

;

"Consolidated debentures of the

'

cooperatives
from

derived

'

and

/

-

•

•.

from

Although,

*: shares

in

the

the > Government.
ownership of the

capital stock in these banks with,
cooperatives that use them, their;
debentures are not guaranteed by
the

Government.

...

.

.

New Thomas Branch
LAKELAND, FLA.

.

_

-

—•

Jerry

Thomas & Co., Inc. has opened a
branch office at 122 West Main^

management of
Linton H. Terry, Sr. Also associ¬
ated with the new office are Lin¬
ton
H.
Terry, Jr. and Olgv R.
Street

under the

Tergesen.
-

t

Layoffs, in preparation for changeovers

All were formerly with
Kidder &

the local office of A. M.

Co., of which Mr. Terry was man¬
ager.
/•'

ployment compensation.
•claims

Joins Birkenmayer Co.
(Special to The Financial Chronicle)

DENVER, Colo.

;

has

—

Seventeenth

Street.




the nation,

number drawing

In that week there were 318,600 new
100 below the week before.

-

,

payments under the, temporary unem¬

ployment compensation program rose 15,900 in the week ended
New claims for these payments in the week
ended Aug. 2 rose 500 to 78,400.
-7. :77,
t

metalwprking has seen the
woods
yet, "The Iron Age,": national metalworking weekly, stated on
In

worst

the

of

steel industry -this week

its

recession, but the industry is not out of the

Wednesday last.-

>

-/■ '

;

?7

v.

-.,7. '7/ v/.'.I i..'v;A:;

that

Reporting the results of a coast-to-coast survey, it said
while overall durable goods orders are trending upward,
picture is still cloudy. Automotive
ing are the big question marks.

the

and capital equipment spend¬

pointed out that it may be several months before
knows how its new cars are going over with the buying
It

Detroit
public.

Capital equipment spending is still lagging in relation to last year.
Outlays for new equipment dropped from an annual rate of nearly
$38,000,000,000 last summer to $31,400,000,000 in the second quarter

MOur 70,h Anniversary
Figures are important in our
1888 is

off today from a new
months ago, this trade
weekly added. But the pickup has been slow. In some cases
the improvement has as yet served only to slow rather than halt
Many metalworking firms are better
order standpoint than they were several
•

particularly

offices,

industry, and for us
the year this firm

was

as

investment bankers and

brokers, we serve many

In 1888,

the United States was on the

threshold of the

industrial expansion the world has ever
known. Throughout this eventful period, our firm has acted
as manager or participant in many underwriting syndicates
which have raised billions of new capital for American in¬
dustry as well as state and municipal governments.

greatest era of

good times

or

bad, in war or peace, Hornblower &
faith in American free enterprise.

Weeks has maintained its
On this, our

70th Anniversary, we look forward

dence to the years

with confi¬

ahead.

i

decline in order backlogs.

Still, the trade magazine
of

That

thousands of investors.

,

a

so.

began business. Since that time, continual improvements in
our services have been made. Today, through well equipped

In

of this year.

continues, there is a general feeling
is that the shakedown

optimism in the industry. The consensus

is about over and better
"It's definitely

times lie ahead.

Hornblower & Weeks
40 Well Street, New

starting to pick up," says the sales manager

of

"We've been living from hand-to-mouth
couple of months, but we have some business in the

for the past

Comments

president of

firm: "The machine tool
are

Mtmbert

HEW

PHILADELPHIA

the

a

machine tool and machinery

industry hasn't seen bottom yet.

going up, but backlogs are

still dropping."

Orders
,

PL 1-1900

(17)

"Open Thundoyt until 9 PM

ROSTON

shop now."

01 4-6400

York 5, N. Y.

'Midtown. 400 Madlton Ayr., at 47th St.

large Detroit foundry.

Hugh C. Al-

joined the staff of Bir-

kenmayer & Co., 734

across

The

a

kire

in automobile models

under way, however. For the week ended Aug. 2,
Michigan reported an increase of 11,600 in, new claims for unem¬
in Michigan arc

.

borrowed $350,000,000:
from the banks for cooperatives.
These Federally chartered banks
operate under the supervision of.
the Farm Credit Administration,
an independent Government agen-;
operatives

cy.

compensation

July 26 to 526,300.

30, 1958, farmers' marketing, pur] chasing, and business service co¬
-

'

A year ago

ment

State,
municipal,
and local taxes. Interest on them,
however,
is subject to Federal
income tax. Also gain from sale
or
transfer by gift or inheritanceis subject to Federal and
Statetaxes," Mr. Knox said.
During the year ended June
exempt

5

equipment company had this
Our proposal department is
working overtime. Both domestic and foreign markets show im¬

of

dif¬

as

for

as

(601)

The Commercial and Financial Chronicle

.

.

months

18

last

.

ROCKPORO

Board of Trado

Principal Stock [xihangei and Chicago
TORE

CHICAGO

MOV IOENCE
CHARLOTTE

WMm

OETROIT

PORTLAND
WORCESTER

CLEVELAND

I

PEORIA

[

RANCOR

HEMPHIE

36

6

The Commercial and Financial Chronicle

(602)

will

W.

By
Mr.

Leavitt

Mr. Jung

LEAVITT

L.

C.

Research

Research

Division, Standard Oil Company

doing

utilize economic theory to gain

so

pointing out the extent,

causes,

present recession, they note

and

recovery prospects

After

seems

to be coming out of its third post
World War II recession. The pat¬
tern of this recession

similar

was

to

misled

be

by

■

many

fairly wide profes¬

where the

nomics

discipline of eco¬
some
insight into

offers

economy's
present
and its probable future.
As

troubles
-

and

of the

increases
is

the- "rate

acceleration

changed

of.

J
D e n

important and the rate of change
„
,
consumption may be small for
.

..

capacity"

>

'

a

in

appeared
tt

_

ji

there

tVio

Fd*rlr>rnl

is

But

serious

a

question
to what the Department of Jus-1

cutihgvth^ contehipi e^tges,";will
,

(hoiYi

will

tice, which is charged with proser

accompiishment.

or

HOuse

friend, Gold-

cited for contempt.

~

l

.

_

be

Daigciun

'
purpose -was to. investigate
the independent agencies, six of

in-

many

fine,
then
Carn&ie

as

'

mu

while. This put a strong damper
on business expansion ahd "over;-

investigation and
himself- but the agita¬

over

Undoubtedly *; the

"*

a.

t
as

uphold thecommittee in its request

8250,000 with

•

.

m

the

1.

dismissed Y Moulder

that Sherman Adams

the

t

W;r

to go

,

J,

.

which

was
trying to squelch
investigation has caused him
along with the witch hunters..

the

:

that

entitled

was

care

chairman of the
took

thevf^d ®if Jias
is

—

of demand

—

medical

tion that he

^

as

mU f

not only wanted
salary but by be¬

his payroll she

Harris

that

;jnsofar

ot

Though final;;
goods has been strong,

the

re-

majns

he

do.

'

Pnnimiinira-

r

After, aU*. Sherman.-Adamsi is

still

powerful

a

also

and

man,*,

+

~

first step, for example,. in
appraising the state of the econ¬
a

in .the light of the develop¬

omy

W.

JL.

Leavitt

C.

R.

Jung:

to those of 1949 and 1954. It
pro¬

ceeded

figures
been

rapidly, and final
indicate that it has

more

may

more

than

severe,

its

two

post-World War II predecessors.
A recession is difficult to define

precisely; however, it is generally
held to refer to levels of employ tnent

and

production

which

are

than seasonally reduced but
which do not feed on themselves

tnore

and extend

several years. In

over

this regard, it appears as a minor

cyclical
run

of

^oods

(the

and

levels

cently

total

sum

services

in

held

dollar

revised

all

of

consumed

has

economy)

ago

long-

a

recession has been mainly
inventory reduction. Final

demand

the

about

rising trend.

This
one

variation

at

in

Re¬

of

Commerce figures show that final
demand averaged $436.4 billion in

1957. Inventory cutting took
place
at a rapid rate. Inventory disin¬

ful

to look

at what has

ernment

of

the

in the future.

Y.-vIV

Consumer

or

villian thus far in 1957-58.
has not panicked, but neither

fields

tories

in

been

a

The

production
end there

mark.

was

up

inventory situation

be

may

sta¬

perhaps

background,

end

equipment. As the possibility
therefore, that the recession
might feed on itself, banking and

arose,

government authorities initiated a
"turn-around" in monetary and

fiscal
the

policy

designed

to

bolster

economy.
broad

rather

•

•

-

consumer's

erally regarded
factor

in

Total

his

as

income
the

is

gen¬

determining

spending

personal

holding
tures

up.

were

pared
lion

with
in

behavior.

income

is

above

Consumption expendi¬
at

a

seasonally

ad¬

and,

in

indirect

some

respects,
of

measures

economy's performance if they

a

as

com¬

figure of $281

bil¬

the

comparable
1957
period. These may even grow in
1958 despite the
present recession
because "built-in stabilizers" and
easier

monetary and fiscal policy
discussed later)
are
ex¬
pected to bolster disposable
per¬
(to

be

sonal income.

But in

Economic analysts have to look
at

automobiles,

and in the first half of 1958

the occasion for the

even

inventory recession, was provided
by declining investment in plant

durables
and

the

field

of

recovery may be

employment

may

the

increasing efficiency of
ductive

equipment

slower

lag because

are

new

call

may

otner

professional

company

knowledge
papers

and

and

and

personnel

its

of

affiliates

ideas

discussion

the

pro¬

for

through
of

these




Business Spending

par¬

exchange
prepared
papers.

There

is

no

question

local

able

**-€11113

and, Exchange

worth of checks which have

Commission

Tariff " Commission.

the

what

and

People

was

the

for his

reason

been cashed.

As

a

issuing
dollars

of

never

matter Of curi-

but

Underlying- it ,1955 by the Senate Banking and
feeling on the part of Currency Committee under Senain-?,Democrats in Congress that Sher- tor Homer Capehart did, is just

governments

to

float,

construction

hospitals,
end

so

public
The

on.

by

plus

factor

nomic

of

an

schools,

utilities,, roads

trend

these

in

services

This will be

the

on

side

of

a

eco-

activity..

plant and equipment expenditures

Adams

man

as

high

a

these

the

first

half

of

1958,

con-

expenditures averaged
$287.1 billion (seasonally adjusted
annual rate) down from a third
lion

1957 figure of $288.3

but

from

up

the

bil-

first

half

1957 figure of $281.2 billion. What
termed gross private domestic~

is

investment
the

$48.8

was

mighty

boss

up

over:

pay
that

Thus they think
dirt when they disSherman

had

in-

coming to its full light. The Department of Justice has just announced that as a result of this
investigation 800 persons and
firms

billion- in

have

criminal

Commission

has

and

and

the

Securities

Exchange Commission in beof

his friend

finding

Goldfine.

has

practically

gation.

It

has

made

for

dent

Eisenhower, a lot of headaches but when the-chaff has been
sifted from the wheat there is
little left to this except some polit-

sentenced

The

recovered
cases

the

ior

government

$7Vi

million,

still pend-

are

return

of

$11,-

300,000.
-

juicy

headlines and has caused Sherman
Adams, and presumablely Presi-

been

fraud.

Twenty-five
ing seeking

occupied the committee's investi-

sumer

quarter

and

himself

set

tervened before the Federal Trade

This
In

had

agencies.

they hit

half

Summary of Income Changes

v;

.

Y

jyr

Y

:

■

w,

.
.

.

INew Morrison

R

orancn

v

WINSTON SALEM, N. C.—Morrison & Co. has opened a branch

office in the Popper Building unthe
direction
of
Peter

der

Smitherman.

ical ammunition which is hardly
worth the $250,000 which the tax-

'

.

down from payers have paid.\
Byrd Adds to Staff ■ Yof $66.7 billion, ^mainly
(Special to The Financial Chronicle)
^ fairness to the chairman of '
.inventory cutting but partly this ; oversight, committee, yRepre-^'
ATLANTA, GaY-Lee A.' Cuitls,
from the slide in capital
spending sentative Oren Harris of Arkansas, jl:._ has been added to the staff
for plant and equipment; Govern-, he has npver favored its investiga0f Byrd & Company, Fulton Fed-r
ment spending,
meanwhile*- -rose tion taking the course it has. He" cvai Building.-;-?'
steadily from $86.4 billion in first was interested in a serious study*
quarter 1957 to $91.0 billion in of the agencies to determine. if
second quarter 1958. The net re- they
were
really,
Griffin McCarthy Adds
functioning
suit is that GNP
(at seasonallv Properly. But he originally turned
(Special to The Financii\l Chronicee)
adjusted annual rates)
dropped the job over to;-a subordinate,
MIAMI, Fla. — William ^ AnC.
from $445.6- billion-in the third member iof
the
committee, derson ha's been
added to the staff
quarter of 1957 to a first quarter. Moulder of Missouri. Moulder imof Grififn
a

first

half

of

1958

peak

■

from

.

i¥XirL1¥AA

of

covered

$425.8

billion

slightly

in

and

the

re-

second

quarter of 1958 to $428.0 billion,
with most of the drop accounted
for

by inventory cutting but with
and
equipment
spending

plant

down

mediately, employed

counsel,

period

economic
almost

has

which

highlighted

confounded

profession,

and,

in

paralyzed
•

and

some

the

greatly

cases

those

a

-

has

charged

n

continued

on

page'33,

York

was

newspapermen.

just about the most offensive
..

™a'lI/uer saw' -,1 am before lu.re
if I had been a witness ,q".ite him
T

ia

_

t Second Avenue

eaSl &eCOna Avenue-

'

to

questioning of witnesses he
_

i

McCarthy, 8340 North-'

general

as

New

determined

was

dug up with

•_

This

problem

young

get scandal. When the committee
tried to hold him in check, he
planted the so-called scandal he
In his

Employment and the Price Level

a

lawyer who

had

somewhat.

puzzles
that

purpose;

the

was

governments .covered,

upward in the next

few years at least.

figure

consumer

fewer hands. Even if the
consumer
•This article (by Messrs.
Leavitt and
.returns in the near future
Jung)
is
based on a paper
as
a
originally
more
prepared for presentation at the Sixteenth
vital force in the field of
-Annual Joint Technical
Meeting of Stand¬
consumer
durables, employment
ard Oil
Company (Indiana). The Joint
in these areas
Technical Meeting is an annual
may not improve
occasion
sponsored by Standard Oil
very much.
(Indiana) in
which
the
scientists,
engineers
and
ent

wiiimmcc

hundreds of thousands

in

justed annual rate of $287 billion

ominous

L'*1

.

needed

most

industrial

bilizing.
An

the

comparable 1957 figures
(unad¬
justed for price changes) and total
to 130 in June consumption
expenditures
arc
But

indications that the

are

force

count

namely,
appliances, and

housing.

The Federal Reserve Board Index

million

dynamic

which

been

creased amount of bonds for much

industrial production,

factory output and a correspond¬
ing
increase
in
unemployment.

—

.'

/j,

t.

.

eral/Trade Commission, Jjie Civil
Aeronautics Board, the Securities

avowed

.
,

have

and

will continue
hero

a

a

he

five

glVL

the

on

1959.

State

provided

Spending

The consumer is neither

the

Production dropped
to a low of 126
(seasonally ad¬
justed, 1947-49
100) in April and
unemployment has gone over the

some

operating on these
spending streams are likely to be

has

Industrial

1958 and

gov¬

forces

1658. This disinvestment in inven¬

large drop in

Soending

happened

business,- and
spending and what

consumer,

He

of

Will

,

averaged
$9.5
billion
(annual rate) in the first half of

vestment

a

itpidLLIIICIIl

part of Fed- are interested in \vhat 'Congress osity I would like to know myself,
eral, state and local governments /does, what the President says and BUt there is a serious question as
is known to be up in 1958. This does^ Y-YY^-YY.*YV *i;- ' : ,to whether it is any,of the cominteractions among these
in
itself
had, and will have, aJ
As a matter of fact these six mittee's business.-'In his appearcomponent income flows.
bolstering effect on the economy, agencies, through the delegation ance in Washington* Goldfine did
The Income Stream
However,
defence
expenditures; 0! authority by Congress over the not develop to be the lovable guy
have recently been accompanied passing years, have a tremendous he had been pictured but that
is
Gross ' National
Prod uct
(the
dollar value of goods and services by much confusion. For example, influence over business on which none of the committee's business,
the shift from conventional air- the American economy turns. The
Congressional
investigating
produced in the United ^States)
cralt to missiles has been a major purpose of the investigation avow- committees
are
-good
and
bad,
dropped from a peak of $445.6
dislocating Y factor
in < recent -edly was to determine if these some
billion annual rate
worthwhile,; some
purely
seasonally in
months. Indications now are that agencies
were-carrying- out the political. - It depends mostly upon
the third quarter of 1957 "to a level
the level of defense expenditures spirit and letter of the lb\vs ere- the
of $425.8 billion in the first
personality of the chairman
quar¬
will rise considerably further.
' a ting them or if they had ar- and, to a lesser extent, the memter of 1958 and rose
slightly to
The role of Federal Government rogated too much power to them- bers.
'
$428.0 billion'in the second quar¬
Y'"Y '}"y>
spending is likely to be on the selves.
For example,
ter of this year. It is not
the good work
possible
plus side as far as business activThis would have been a worth- which the investigation into the
to trace out each of the
component
I say this was the housing
parts of GNP here, but it is use¬ ity is concerned for the rest of while study.
windfalls in
1954
and

the first half of 1958 versus
$436.8
billion
during the first Half of

occasioned

<11 Id

above, economists

the

year-

terms.

outlined

National Product) and the
major
components of that stream as well

as

to

Department

UUir

plant and equipment expenditures
a basic foundation for, some. time.
generally look at the total income
Y/ " - Y Y
Y'../Y
stream (which is most accuratelyGovernment Spending ■
measured by what is called Gross
ments

.

-

it

the

that

government gives.

get it but

men-

on

to

sales.

in

demand for

n

expen-}1ni,htpHiv

anticipation

ing

$60000
u

is

her to. have the

aulhor.

wants

Businesses only add
in

Q

j;ized for it and

spending—

consumer

t h

orig-

Q ^ e

interrelationships

plant capacity

it

p t

e

function of the rate

a

tioned above

tor

mech anism

investment

assumes

change in

one

p

$250,000

described by

is

"accelerator"

ditures to be
of

s

..

theory

economic

in

years

which
re¬

tion

de-

a

well. jnaU

known

isolated

the

the status of

Pr®?f*on*
Y-;-■Y-^/;rY£YYYY
The
situation
has
been

,

reference will be made to

paper,

Vle •'House governments over- intrepid fighter for .light and
Slg
committee, or whatever the truth, had his daughter on his
committee tha* has been,-pursuing payroll while she was attending
**^
-^His .bland explanS?
M

•>.

S™tess1orw"M0be7ro»
■

sional agreement. Throughout this
areas

very

on

and approach
-

lay-offs or
hirings,. plans for expansion or
contraction
by
individual com¬
panies and so on. And, contrary to
some
popular opinions, analysts
of the economic picture have' at
their disposal bodies of theory on
which there is

of the News

By CARLISLE BARGERON

factthatthe? turned downward
thJ mdlnok
man? that

for example,

on

Washington itYY-

Ahead

Al-

and

fnrrnrt

the

ports

others.

hig^Xllar?evelstl?he

sUUat

of the

expected.
not

economy

From

<■

a

Introduction

•

American

and

studies

by

as

Thursday, August 14, 1958

.

estab¬

by the De¬

ago

well

as

Board

ference

insight into the

likely to be moderate, and agree the petroleum industry is
recovering from the recession .sluoip and that further growth

The

-time

some

1958

was

the National Industrial Con¬

pany,

;

World War II. The authors believe the near-term recovery is

is

fact

by McGraw-Hill Publishing Com¬

close relationship existing becapacity and demand and crude oil runs since

tween economic

through

This

penditures

(Indiana)

troubles and its probable future.

present

economy's
:

some

down

Exchange Commission survey of
expected plant and equipment ex¬

and

Two mid-west oil economists apprize the business outlook and
in

lished

Supervisor of Economic Research, Commercial

is

1959.

partment of Commerce-Securities

JUNG*

R.

of Commercial

Director

is

and

be

ihto

The Business Outlook

.

.

u

Loomis, Sayles Adds
(Special to The Financial Chronicle)

MILWAUKEE,
r

bpll

T

Wis.

—

v

Leonard
,,

,

*

Ind

InC'' 4" EaSt MaS°" Stre6t

'J.

Herbert Teden

would have cursed him out and
taken the consequences.
■
Herbert E.
Moulder who defended him, it Teden & Co.,
has been brought out, and who is
hailed by some reporters as an

,

Gampbeli' Jr. hab been added 4o
!:
a ~
dll
l?nst
TV/lEicnn

passed away

Teden, President of
Inc., New York City,
suddenly Aug. 10 at

the age of 56.

--»-

Volume 188

Number 5768

.

.

The Commercial and Financial Chronicle

.

(603)

holders for decision. The acceler¬

The Corporation's Relationship
With Its Owner-Stockholders
j;.

.

,

,

..

ated

Professor of Finance

£■/

on

it

depend

uponpublic relations counsel,

communications.

..

with

bow management

behavesaminot

programs

sincere

interest

in

the

development of stockholderThe best
corporation relations.
known are the highly articulate
and literate Lewis D. Gilbert ami

■

:

.

1930's; (2) growing body of law on stockbolder-manneement ; V-* relations sparked by- Gilbert brothers, security analysts and A>

vociferousfringe of investor advocates; (3) circumpractices that induce dissatisfaction, and symptoms
V
of deteriorating relations that foretell contest control rum¬
Managing Stockholder Relations'
blings; and (4) suggestions oh avoiding tontests for control - ;
IdL There is a growing body of law
and keeping owners properly informed. Warns corporate man-"';."'
relating to the relations between
agement must either choose genuine democratic ^corporate conmanagement and stockholders.
Wise management is coming to
trol by stockholders or suffer statismrin-economic affairs. ; /
more

stance and

?

r

J
caiPrtalism .partnershipsole-; proprietors.
,

SSSIrtw than The. corporation

*.

realize
ls

is regarded.as an

?.Ke!Jfate fr??Vlts.

ian

sound

long-term interests of

a

that

the

to

recourse

Jast resort and tKat ^

law
cor.

01.ate decisio'ns ought not to be
ntadfr fey management. Alert man-

wie

ui

itas

iiccca&eiiy

cviis

holders'

ui

perhaps

of

View was contained in a 1933 book

business

enterpris
provide

es

a rea-

'

V

c o ns u m e

men

funds

are

: *

r

De

A
•

most" produc-

tive

not

channels

-

•

'

-

-'°

k. Burreii

by

the edict of a political
agency but by the intelligent self

for

a

decision

as

.

interests

all

of

concerned. £hje increasing number
of proxy CGntests is symptomatic
of two deficiencies in stockholder
relations; One of these is the lack
of

consideration

adequate

.

planning of investor

own-

tions.

become

had

ing' easier,, ana in many ways pro-

the. best

something of a
fiction.
Apathy of Stockholders
-toupled with the difficulty of ac¬
curately ;vmeasuring management
results had, in the opinion of the
•. authors, created a situation calling

t

into

rec'ted

for the benefit of its

run

irs

di-

;

of" this

Jr..; and G? C.
Means.1
This "/significant
work
Anointed out that the traditional
view that the corporation should

In¬

vest

>

v

by A. 'AA Berle,

kon'ably
reli¬
able guide to
wishes.

•

-

'earlV 'nresentatiori

Ari

movement"

Good

and

Communica¬

investor communica¬

tions do not necessarily involve
expensive public relations efforts,
ornate slick paper annual reports
and the

like; indeed seme of these
methods are probably worse than
no

to whether social

.

communications

all.

at

But

has.

of

of

owners

devel¬

Gilbert,
thors, 1957.
-

impracticable and
attempt to restore

that it would be

undesirable to

The

poration and its management and

stockholder

the stockholders who

a

the

efficient

gal pressure should be applied to
the end that corporate decisions be

Published

the

by

a

matter

functioning of the free enterprise rather than management is ideal,
—free market system, as well as but in
practice no case comes to
a fringe of more vociferous inves¬ mind
where
stockholders
have
tor advocates. This movement has

evolved
of

a

sort of platform or code

good management behavior

far

stockholder

as

relations

so

are

Some of the planks in

platform include the following:

(1) All directors elected

anhu-:

ally by cumulative voting.

elected auditors other than those
nominated by management. The
ethics

of

appointment and this has, meant
that

election

of

auditors

own

it is

power.

,

->

i

'

■

-

•.

tion

with

,

occasional

regional

/■,;
•
v
(3) A majority of directors in¬

meetings.

•

thing

dependent of management.
(4) Directors to maintain
sonable

*

;

(5) Election
stockholders.

(6)

a rea¬

ownership interest in the

company.

<

of auditors by
;

;

,,

;

,

,

,

Orderly conduct of share¬

holder

meetings,

free speech—post

holder interest.

no
curbing of
meeting reports

as
Neither

losing side's costs in

the

general

Debentures.

are
corporate manage¬
always competent and de¬
voted solely to the best interests
of the enterprise and its stock¬
holders.
This is to be expectedAfter all political movements may
sometimes be actuated by bad mo¬
tives; but this is not to say that
all political movements should be
suppressed. Who is to distinguish,
good motives from bad? The term
corporate "raider" and "liquida¬
tor" have come, undeservedly th
be bad Words. Some corporations
ought to be liquidated; some quite
large corporations that should be
liquidated continue in operation*
because of the separation of own¬
ership and control and because
stockholder groups do not have
the resources to force liquidation..

Continued

a proxy con-

on

page

sell nor a* solicitation of an offer to
The offer is made only by the Prospectus.

buy any of these

perpetuated

$45,000,000

be modest and could be met from

>

by

stockholder;

dis-

Consolidated Natural Gas

and apathy, the allocation" ''internal" sources thus making it
of resources may reflect the inter-i unnecessary to secure very much
est of management itself rather,* new capital from investors,
than the general interest. In genAbout
a
decade later,
James
eral the stockholders interest may Burnham in a book with a
strong
be

expected

general

approximate, the! flavor of technocracy dealt with
not b e ca u s e the same problem 2 but concluded
are
philanthropists, that the technical managers of

to

interest,

stockholders
but

because

is

-sources

the

wise

profitable.

management,: to
terested

in

be

of

use

re-*

Competent

is

sure,

in¬

corporations,
from

become

'

the

profitable use of class"
resources, but unchecked and in- kindly
competent management may opi But
erate as a drag on the general c h a n
economy. Moreover, it is unreal- turned

in

managers,

the

kind

a

of

world

subtle

but

.

Moreover

expect that even

£o6d judge in his

it Is Unreasonable

compe-

a

,

stockholders

case", and rather suddenly, to be anything

to

that; but apathetic. The financial

expect

press

management which is not coupled
an ownership interest is fully

appears

alihost to serve up a new
major proxy contest with every

Qualified to make

edition.

an unbiased devision involving complete or partial liquidation.
- :
..

* Ma

nn p-priii ii«!m
Managerialism

-

-

-

^

UMjable of view the ^public stockto
holders
corporation as
a

?

simply

Popple

holders of

Congress

ceived

.whom the

appeals for
"protVcf' corporations from "raid-

behind

force

this

change.

The

a

1 The

a

THE FIRST BOSTON CORPORATION

EASTMAN DILLON, UNION

SECURITIES & CO.

GLORE, FORGAN & CO.

substantial influence in

permitting and f&cffiteting the-fair

.

MORGAN STANLEY & CO.

legal

and authority of the SEC

f,een

Modern Corporation and

LADENBURG, THALMANN & CO.

GOLDMAN, SACHS & CO.
4

stock¬

to

WOOD, STRUTHERS & CO.

Private

I

Property, by a. a. Berle, Jr. and G. C.

th« 0f St0Ckh0ldep °f cl°Se M2Th« MSSSi Sution.
or
members of
Burnham, John Day Company,


Corporations,

pliance with the securities lays of such State.

even re¬
measures to

lSr °i de^iJhe StOGk' ;
presentation of issues

publicly held corporations in this- philosophy are thus
assigned a status quite different

Copies of the Prospectus may be obtained in any State from only such of the
undersigned as may legally offer these Debentures in com¬

has

,ers." How the world has Changed.
There-have been many factors

S

.fash.

Price 101.142% and Accrued Interest

seem,

own

with

V

payable February 1 and August 1 in New York City

Interest

^

cient principle that "no man is

to

Due August 1,1983

1,1958

has

tent managements are qualified to
make some decisions. It is an an-;

;

1

vastly
g e d.
Stockholders
have
out to be important. Corporations have
needed and do
need capital beyond that possible
to generate from internal sources,

lstic

re,

Dated fin gust

"ruling

new

dictatorship,
the

43/8% Debentures
Due 1983

distinguished

financial

the

would

as

}

August If ,1958.

bv James
19**

,

'

■

a

ments

ment needs of corporations would

jjersion

stocky-

There is such

corporate' "raider.'*

0

terest, and where that control is

?

better corporate management andl
the advancement of

.

This annoiincement is neither an offer to

made primarily in' the interest of
. society
as a whole. This analysis
cern
the wise use of resources, was made during the period of
When corporations are controlled; extreme-depression and it was asby those with little ownership in- - sumed that- mew capital invest-

**.•-

Annual meeting of stock¬ ; - Not all stockholder revolts are*
holders held in a convenient loca¬ based upon a genuine interest in

(2)

authors

-

nomi¬

nated by management has become
a matter of form.

au¬

/■:. -'

responsible accountants

do not permit campaigning for the

then concluded that social and le-

matter of increasing public and
private concern. The separation of
ownership and management raises
some
grave problems that
con-

especially

of form than of
Perhaps in theory, au¬
responsible to owners

more

ditors

in

investment

counts of business corporations.
The relation between the cor¬

smaller corporation,

substance.

interested

when possible.
•
•
• <
and legal pressure should be ap¬ poor communications is not funda(7) -Reasonable executive com¬
plied in an effort to insure cor- -mentally . responsible for proxy
pensation geared to performance
funds and by those who advise porate operation in the interests contests and bad stockholder relathem. The essential ingredients of of owner-stockholders, or whether tions. The primary cause lies in and subject to review; by inde¬
private capitalism is the free mar- such pressure should be applied to how management behaves and not pendent directors or'stockholders.
(8) No waiver of pre-emptive
ket ' system in which consumers bring about corporate operation in in how it communicates. True, a
are free to select goods and servthe interest of society as a whole, bad
or
ineffective management rights.
(9) No "side deals" or self deal¬
ices under conditions of competiThe authors believed that, it may perpetuate itself for a time
tiort and where investors are free would be intolerable to continue by means of good communications; ing between the corporation and
management.
to allocate savings to new capital to permit corporate operation in
3 See
Seventeenth
Annual
(10) Full disclosure.
Report of
investment in response to changes the narrow interest of the manStockholder
Activities
at
Corporation
(11) Some partial reimburse¬
in consumer preferences as indi- agement ;group, and' that stock¬
Meeting's, 1956 by Lewis D. Gilbert and
ment from corporate funds of the
cated in the profit and loss ac¬ holders had in fact abdicated and John J.
interest

losing

where stock ownership is concen¬
trated in a single geographic area,
is in some ways less difficult and
in some ways more difficult. Com¬

those

makrpc

rndrely ;t contractual

;

siinniiprc nfvpar»itnl

the

and

substantial- vote.

a

Some of the above points apply
only to the large publicly held
corporation. The problem of the

oped, led by security analysts and

3 ^ockhoidM relations avt.ids many
nnhlin firranr-

,

side polled

and

the

"

people w a n,'t£. '.\
Tho profit and
loss
accounts

own¬

substantial issue has

a

presented

ers, prompt

concerned.

*
"
«■■■■■■
services t h a t>

on

beVn

,

r;

-

accent needs to be

good management behavior, man¬
agement, of the enterprise in the

test where

7

reporting of financial munication between
management
operating statements at fre¬ and stockholders is
easy,- but to
quent intervals, maintenance of a is communication
between a mi¬
dividend policy designed to sup¬
nority or dissident group. • Cer¬
his brother John J. Gilbert who
port a reasonable price for the tainly
not
all
of
the
points
have
appointed •- themselves
as
securities, as well as an organiza¬ enumerated above are of
equal
stockholders representatives and tion structure
not deliberately de¬
importance or equal/validity. On
who attend a great many annual
signed to
prevent
management the basis of common
observation,
meetings of stockholders and ably changes.
In recent years some¬ for example, it would
appear that
present the stockholders case .3
thing on the order of a "stock¬ stockholder election of auditors is

or

Professor Bnrrell
(1) turn about in stockholder relations since

on:

a

sound

In amplifying this thesis,

comments

for

necessary

of a number of quite
newsworthy "corporate gadflys"

and its management

and the stockholders who

own

develop¬
have made

years

emergence

University of Oregon, Eugene, Ore. /

Good relations between the corporation

■

-

of industrial

in recent

later the fact of poor
management must become evident
to informed
sooner or

investors, and when
corporate man¬ that time comes a syrupy com¬
agements
to
be
attentive
to munications program becomes
only
stockholder interests in order to an invitation to a
proxy contest.
facilitate capital expansion. A not
In
planning good stockholder
inconsiderable force has been the
relations the
it

By O. K.BURRELL .,./,

;

pace

ment

but

32?

8

The Commercial and Financial Chronicle

(604)

Hornblower & Weeks Marks 70th Anniversary

to

I

firms mentioned will be

mend interested parties

Thursday, August 14, 1958

.

Hawes Pres. of

Blyth & Co., Inc.

Recommendation's & Literature
It i* understood that the

.

Blyth Named Gh'man,

m

Dealer-Broker, Investment

.

Blyth & Co., Inc.., 14 Wall St.,
York City, announces that
Charles R. Blyth, who has been
President of the firm and its predNew

pleased

the following literature:

wm

40—Including number of radioistope users

Atomic Letter No.

1953; discussion of acceleration of atomic power con¬

since

in

struction

Europe

Co.

Development Securities

Atomic

—

Inc., 1033 30th Street, N. W., Washington 7, D. C.

;

View

Burnham

—

investment letter

Monthly

—

Burnham and
Also avail¬

Company, 15 Broad Street, New York 5, N. Y.
able is current Foreign Letter.
-

1

Clic—Booklet

teletype

on

reporting system—Chesapeake

car

and Ohib Railway, 3807 Terminal Tower,
Fire

•

Cleveland 1, Ohio.

Results—Bulle¬

Casualty Insurance Company Operating

tin—Kidder, Peabody & Co., 17 Wall Street, New York 5,
Y.' ,r" ■,,
v
.
*
Industrial Production in Japan—Discussion-—Nomura Securi¬
N.

-

anniversary of Horn-

the 70th

Weeks, Ralph Hornblower, Sr.* and his sons, Henry II
and Ralph, Jr. (right) meet in front of a portrait of Henry Horn¬
&

blower,

•

Co., Ltd., 61 Broadway, New York 6, N. Y. Also in the
bulletin is a discussion of the Japanese Auto Industry.

ties

Generations—Marking

"Three

blower

,

,

a

Charles R. Blyth

founder of the firm in 1888.

Japanese Stocks

—

Hornblower

Current information —Yamaichi Securities

—

Analysis

^

Street, New York 5, N. Y.

;

•

Oil Industry: A Decade of Gross Margin

of

celebrating its 70th anniversary
of operations under the original
name, according to an announce¬
ment by William R. Rovensky, a
senior partner of the firm.

R. W. Pressprich & Co., 48. Wall

—

members

principal securities exchanges, is

New York.

Meat Packers

invest¬

Weeks,

and

bankers

ment

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

&

Movements—Study—

Boni, Watkins, Jason & Co., Inc., 37 Wall Street, New York 5,
New York.

In addition

to acting as

parison between the listed industrial stocks used in the Dow-

securi¬
ties brokers for many thousands
of investors, Hornblower & Weeks

Jones Averages and the 35 over-the-counter industrial stocks

also

Over-tlie-Counter Index—Folder showing an up-to-date com¬

used in the National Quotation Bureau

yield

market

and

performance

National Quotation

over

Averages, both as to
a
19-year period —

Bureau, Inc., 46 Front Street, New York

4, N. Y.
Public Utility Common Stocks
Saxton &

Put

Comparative figures

G. A.

—

Options

Schmidt &

—

Booklet

how

on

to

them

use

Filer,

—

Rayon Industry

in India—Discussion—Harkisondass Lukhmi-

dass, 5 Humam. Street, Bombay, India.
Review of
way,

New York 5, N. Y.

Valuation
of

Recommendations—Sutro Bros.

of

Going

&

YMYY YYv^YY.

ratio

guide—Ford,
Inc., 39 Broadway, New York 6, N. Y.
'■...

American
11

a

> '•

■

•

as

&

Foreign

•

or

&

of

the

in

16

time

offices

Its

New

in

Davis,

1901.

located in

York

office

Recently

was

50th

the

offices,

the last being the senior

the

Co.,

Inc.,

Also available is

a

Dallas

Inc.

of

Company..-

•••

Brunswick Balke Collender

—

v"

•

'

Y

Federal

Survey — Abraham & Co., 120
Also in the same circular are

surveys of Burroughs Corp. and Mead Johnson.

elected

President.
The following
Vice-Presidents, who together with

Chicago underwriting house Paul

the above constitute the Executive-

H. Davis & Co.,
"Hornblower

Committee,

in 1953.

Guardian

;

to

able

are

provide

complete

C □ M I NG

our

Partners of the firm

are

in

of these

many

EVENTS

offices,

office

which

is located

on

in midtown

Avenue

Aug. 21-22,1958 (Denver, Colo.)

Madi¬

Bond

Manhat¬

nual

a

Credit

Daniel F. Rice &

Also available

are

Kerr

McGee
.

Finance

Well

Oil

Also in the

.

.

press—"

'

/ Y

-

;

Corp.—Memorandum—Albert J.
;

:

~

Cementing

Co.

—

Analysis

—

Alfred

;

Co., 55 Liberty Street, New York 5, N. Y.
circular are brief analyses of Harris Inter-

same

memorandum

a

■

—

-

'45

-

Appliances

Co•

Chi-

Club;

preceded

II at the Uni¬

(Cincinnati,

;

-

Municipal Bond Dealers Group
annual outing —/cocktail and
dinner party Thursday at Queen
City Club; field day- Friday at;
Country Club.
(Cleveland, Ohio)

Club

Cleveland

of

fall

outing at the Cleveland Country
Club.
'

Roekford Securities Dealers As¬
sociation

annual

"Fling

-

Ding*'

at the Mauh-Nah-Tee-See Coun¬

on

try Club.

Sept. 29-Oct. 3, 1958

Detailed study

Lobitos Oil Field Ltd.—Memorandum— Hirsch &

..

an¬

Co¬

Sept. 26, 1958 (Rockford, 111.)
Y

—
•

the Broadmoor.,

Corporation—Analysis—Dean Witter & Co.;
Montgomery Street, San Francisco 6, Calif. Y Y
Y YY Y

..

—

Memorandum

—

A. C.

.

-

.

Y""/.

.

Oct. 2-3,

1958

(Kansas City, Mo.)

.

Southwestern

Allyn and Company,.

;;

-

;

Group of the In-

'

;

Incorporated, 122 South La Salle Street, Chicago 3, 111. Y

(Colorado

Springs, Colo.)

National Security Traders Associatian Annual Convention at

Co., 25 Broad

,

Safety

the

at

Steel.

Iowa Electric Light and Power Company

.

Mackinac Bridge

Mine

hurst .Country

Bond

L.

,

.

frolic

: :

_

Rocky '

annual field day at Elm—

Maketewah

Lockheed Aircraft
„

cago

Sept. 26, 1958

Street, New York 4, N. Y.

Revised 4 Page Study of:

-

Group IBA 24th

summer

Sept. 18-19, 1958
Ohio)

Kidder, Peabody & Co., 17 Wall Street, New York 5, N. Y.

off the

Denver

by dinner Sept.
versity Club.

International Telephone & Telegraph Corp.—Review—H. Hentz
& Co., 72 Wall Street, New York 5, N. Y. Also available is a

analyses of

financial institutions

;

t.ype Corp., Interchcmical Corp., Outboard Marine Corp. and
Westingliouse Electric Corp.

Granite City

Just

Oil Industries,

■">

Mortgage Association—Analysis—New York

study of Fischer & Porter Company and
For

.

Vanden Broeck &

Company—Analysis—Reynolds & Co., 120

Broadway, New York 5, N. Y.

on

;

Corporation,; 120 Broadway, New York 5, N. Y.

Consumer

Halliburton

Company, 141 West Jackson Boulevard, Chicago 4, 111.
Commercial

of

lumbine Country Club.

Corporation—Analysis—Dempsey-Tegeler & Co.,
Houston Club Building, Houston 2, Tex.

Company—Analysis—Schweickart
Co., 29 Broadway, New York 6, N. Y.
—

Club

Mountain

The second Chicago office is
prominent ground floor loca¬
tion on South Michigan Avenue.
tan.

in

Investment field

In

land, Portland, Me., and Philadel¬
phia. New York also has a second

Gulf Sulphur

Cincinnati Milling Machine

Analysis

Senior

having

on

Caplan & Co., 1516 Locust Street, Philadelphia 2, Pa.

Co.—Memorandum—Doyle, O'Connor

—

elected

were

prides Vice-Presidents: J. Lawrence Pafully-equipped gen, Eugene Bashore, A. E. Pontoffices in a limited number of ing, Donald N. McDonnell, Paul
important
cities
rather
than Devlin and James F. Miller.
smaller operations in more cities,"
Mr. Rovensky said. "In this way,
itself

Weeks

&

.

National

as

and the prominent

1942

— Analysis — Bache & Co., 36
Street, New York 5, N. Y. Also available is a 1958
- * ', ]■
Y ''
Yv Y,. '
•• -

Hanseatic

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

Clinton* Engines Corporation

memorandum

a

Forecast.

Broadway,.New York 5, N. Y.
Chicago Mill &■ Lumber

Francisco, will remain

change firm of G. M. P. Murphy
& Co. in

YY:T;"r Yv Y ■ 'Yv "Y";■■ YY':YV

Wall

Dallas 1, Texas.
Mississippi Valley Gas

on

San

staff of the New York Stock Ex¬

Eaton Manufacturing Company

Building,

memorandum

Board, which will be the chief
George Leib, of;

executive office.

Cluett, Peabody & Co., Inc. and Philips Incandescent. Lamp
Works and

in

President

as

Sept. 12, 1958 (Chicago, 111.)
Municipal r Bond Club of

Co.—Memorandum—Rauscher, Pierce

Mercantile

resigned

New York, and Roy L. Shurtleff,

Pont, Homsey & Company, 31

Street, Boston 9; Mass.

Arkansas Louisiana Gas

\

formation

and has been elected Chairman of

including Boston, each of the two
Chicago offices, Detroit, Cleve¬

Chicago/ Providence and Detroit

Power—Report—Thomson & McKinnon,
5, N. Y.
' :

has

its

Vice-Chairmen. Stewart S. Hawes,
of
New
York
City, has
been

located

opened

by

1914,

firm of Detroit. „• ;
growth of the firm has
been generated both by opening
of new offices and absorbing other
organizations. Two important ac¬
quisitions were the partners and

offices."

anniver¬

celebrated

were

broker¬

investment services at each of

cities.

14

and

The

we

its founding

of

banking

age

son

saries

Also in the same circular are
brief studies of Truax Traer Coal, Raybestos Manhattan and
Chicago Pneumatic Tool.

&

number

a

investment

Wall Street, New York

Milk

&

of

directors

are

leading industrial companies.

in
Boston
in
1888, Hornblower &
Weeks had one employee. Today,
it lias more than 750 employees

•

American Fetrofina—Data—Du

&

much of its

over

exempt securities. Partners of the

Merger—Use

Bacon

in¬

70-year history, serving as man¬
or major participant in undenvritings of corporate and tax-

Y- :YXY' :Y>lY;Y:/;:.

Companies for Purchase

price-earnings

Co., 120 Broad¬

well-known

a

ager

At

Co., 120 Broadway, New York 5, N. Y.

been

vestment banker

firm

Co., Inc., 52 Wall Street, New York 5, N. Y.

Call

&

—r

has

since

ecessors

same

■

Bankers

vestment
annual

Association

outing at Gakwood Golf

'

Mine Safety Appliances

World's
the

largest ^producer of safety equipment;

pioneer

boron fuels

high

.

manufacturer: of

and. thermal

temperature ^ liquid

jCo.—Study—Troster, Singer**& Co:,'74

Trinity Place, New York- 6, Nv Y."r

;

.National Cash Register Co.

.

high-energy
batteries;, leader in

:v
"

Y^

'

Y

Y

—
Review
Ira Haupt & Co.; Ill
.'Broadway, New York 6, N. Y. Also available is a review of
Home-Oil-Company Ltd.YY
—

metal Y technology

Rockcote Paint Co.

Report — Milwaukee Company, 207 East
Michigan Street, Milwaukee 2, Wis.;,
v-"Y
'
v
—

,

Temco

Troster, Singer & Co.

.

,

Security Dealers Association'

.

Aircraft

Corporation—Report for first six months of
1958—Temco Aircraft Corporation,-Department CF 2, P. O.
."Box 6191, Dallas 22,,Tex.
: r >4'- "•

Tenuey Engineering Co., Inc.—Study—George, O'Neill & Co.,
Inc., 30 Broad Street, New York 4, N. Y.
•
.

74

Trinity Place, New York 6, N. Y.

Yictoreeu Iinstrument Co.
&

HAnovcr 2-2400




Teletype NY 1-376-377-378

>

;

/
»

v;

Country Club;, cocktails and
lunch; at Eddys; Thursday, arid

dinner/ that evening; golf, btc.,

Friday.■-"YY,

>

•'V..-;'Y7'-

•

*

Members New York

&

YY

-'t H*'; ;

—

Memorandum

—

Co., 1441 Broadway, New York 18, N. Y.

Weyerhaeuser
pany,

Timber

Maltz, Greenwald
;

Co.—Analysis—The Milwaukee
207 East Michigan Street, Milwaukee 2, Wis.

Oct. 6-7, 1958 (Boston, Mass.)

-Association of
Firms^
Y meeting

-

*

Stocfe Exchango
of
Governora
-

at Somerset Hotel.

Oct. 25, 1958

(New-York City)

r

Security Traders Association of
New York annual cocktail party
and dinner dance at the Hotel

Pierre.
Nov.

7-8, 1958 (Chicago* HI.)

National

Com¬

Board

:

Association of Invest¬

ment Clubs 8th annual conven¬

tion at the Hotel Sherman.

j

Volume 183

Number 5768

...

The Commercial and Financial Chronicle

(605)
panics to arrange for

InvestmentProblems
il-

Decedent's Estates
By RUSSELL A. HUNTER*

of their

one

such,

cases

the astute executor will

the Will

stock.

7

-

-.rw+A*

a bank's
investment officer, executor (and
trustee) and co-executor should do, and be aware of, is sum¬
marized^ in Mr. Hunter's paper on investment problems and

Quite

-

discover

:j

*

often
that

M,

executor

an

will

securities

some

nerships, present many problems
and are perhaps the most difficult

are

surviving him.
tors

(the estate); defines valuation method
called: "taking blockage"; and explains why he believes cor¬

.

owner

.

the necessary

Officer,

in the
Department of the bank,
makes a preliminary review of all

ate

as

the

ties

list

a

securi¬

of

a

_agents, such

as:

letters testamentary, certified

prepared. The
word "list" is

copies of the will, affidavits of
domicile, inheritance tax waivers,
signatures of all co-executors
(who may be widely dispersed
geographically), etc. *

here be¬

used

in many
estates and for
cause

a

variety

of

It goes without saying that the
approval of a co-executor is nec-

possible

to take

actual'

possession
the

for

of

securities
some

time.

However, it is
generally pos
...

.

nusseii a. Hunter

...

...

,

sible to obtain

a

-

,,

description of the

securities and it is from this list
that the Investment Officer ascer-

tains whether immediate action is

required

prevent
from suffering a loss.
to

the

name

so do-

physical

:

J.

.

resented

the

usually

real

assets.

In

un-

complex. situations

you
—- wish to obtain assistance i_ ^
-ui.:
i~i.
may
and
advice from one of your large

city
correspondents
having * a
special group of officers, in their
Trust Investments Division, whose
sole function is to expertly ap-

V

>

changes in the portfolio as he
deems necessary. If the Will does
hot provide for retention Or if
he is administering the estate
without benefit of a-will he us—n^.^i—* liquidate the
ually must
portfolio
promptly to provide for a cash
distribution.
In many jurisdictions, a year from the date of
death may be considered a reasonable period in which to accomplish this. However, should

,

cus-

estate

explanation of the advantages of
such an arrangement, he usually
reaiizes that his fears of the estate
inointy

+Ka

+jfi~

groundless.

Having listed the securities, the
praise and supervise such enternext step is to value them as of
prises for their own estates and the residuary legatees wish to
the date of the decedent's death, trusts.
'
take securities as distribution in
This inventory is a very important
kind, many executors will retain
document—the foundation of the
Specific Legacies of Securities
them for this purpose upon reexecutor's administration of the
There are
v

•

.

many

estate.
Obtaining values for 'securitfe«-traded on exrhan^pc and

m n

the

registration

by

law

the

is
of

fetters>

form

more

.

Tf ic

pnnppmpri

does the executor distribute to the

in

Partlcular Jssue concerned. It is in
this area that the executor may legatee when the estate holds both
a

problem in that there

made

bar

many

values placed upon identical

considerable, variance

the preferred and common issues
of that company?

may

in

ceipt

instances where

.

.

.

...

the

Another

secu-

problem

the

Iv

sa

tne

sale

e

ceeds without

of

conversion

or

conver-

approaching- expiration dates or
Of equal impor¬
tance is the prompt closing
of
margin accounts, for obvious rea¬
sons, and the sale of those securi¬
ties which, because of their highly
speculative characteristics, make
other deadlines.

estate

the
risks

of

vulnerable

principal.

to

various

Steps

should be addressed to

bank.
:

As

..

to

are

usually

sufficient

be

con-

for

the

the

.

to defend it should any question
be raised by the heirs or taxing

tor

of

an

Tax Waivers

estate

must

obtain

There is also the type

tion in which a

of

stock

transfer

domestic

th?- sjteps. necessary

tant

estate

securities

are

not

physi-

cally in its possession.

requirement because in

Great Northern

Second

tain

of

one

Immediately upon the receipt
securities, most Trust Compa-

nies

begin the process of transferring the registered issues into the
name

of their nominee.

nominee, for this
pose, is usually a partnership

pur-

waiver

a

State.

stock

of

from

more

mains

of Senior

the

Officers

real

or

the

New

York

Railroad, for which

a

beneficial

order

to

obtain

these

waivers,

arrangement,

usually

decedents

estates

and

trusts, has
many
advantages.
Among
the
most important is the ability to
sell and make- good delivery of
any registered security at a moa

talk

by

Mr.

Hunter

versity, Lewisburjr, Pa.




before

Railway

Equipment Trust Certificates

£87,000 semiannually March 1, 1959 to

September 1, 1973, inclusive

guaranteed unconditionally as to payment of par value and
by Great Northern Railway Company

dividends by endorsement

MATURITIES AND YIELDS

be accomplished.
Many estates hold one or more

(Accrued dividends to be added)
2.25

Mar. 1961

Sept. 1959

2.50

Sept. 1951

Mar. I960

2.75

Mar71962

3.65

Sept. i960

3.00

Sept. 1962

3.75

Mar. 1963

Sept. 1963

3.90%

Mar. 1964 to Mar; 1966

3.25

Mar. 1959

4.00

Sept. 1966 to Sept. 1968
Mar. 1969 to Sept. 1973

4.05

3.85

4.10

Commission,
circulatedfrom only
lawfully offer these securities in such State,

Issuance and sale of these Certificates are subject to authorization by the Interstate Commerce
The Offering Circular may be obtained in any State in which this announcement is
such

payment of the tax due, or a suban

mature

squired from Pennsylvania, Ohio,
Michigan and Indiana before

the

only feasible for those who specialize in the administration of

♦From

To be

Central

waiver is

com-

of

owner.

Such

To

than

An example of this is

Canadian securities. The delay in
obtaining Canadian waivers can
Trust Company whose sole func- be considerable, ranging from sevtion is to hold title to registered eral
weeks to several months.
Securities belonging to the many Normally, two waivers are reestates and trusts for which they quired, one from the Provincial
act in an agency or fiduciary ca- Government and the other from
parity. The estate, however, re- the Dominion Government.
In
prised

jxigfc

(Philadelphia Plan)

transfer may

A bank

the same ca-

Equipment Trust of 1958

4%

some

for the executor to ob¬

necessary

Nominee Registration

m

:

$2,610,000

r,,

situations, such as is the case of a
Pennsylvania decedent, it may be

that the

to save the
despite the fact

dividual served

bond'or preferred Paclty with, identicalcm
Investment
Contttme^

cor-

7-

of the undersigned and other dealers as may

stantial payment on account
'

.ls,usua*}?r required. Muc

intormation, necessary to
compute the Canadian tax, is not
available to the executor in the
early days of administration and
must be developed over a period
of time.
Occasionally,

an

HALSEY, STUART & CO. INC.
DICK &. MERLE-SMITH
■

R. W. PRESSPRICH & CO.

FREEMAN &. COMPANY

McMASTER HUTCHINSON &. CO.

estate will hold

securities of British companies. In
these Instances it is

usually^de-

sirable for the smaller trust com-

August 14, 1958.

a jarger

the case,
«xne^ase, if amanexperiencea ihlr an .inexperienced in-

waiver from the taxing authorities
before
the
transfer
agent will

p0rations from the name of a deceased person. Sometimes, a delay'
in
applying for and receiving
date, the experienced Trust Com- these waivers results in losing a
pany will immediately recognize favorable selling opportunity due
any situation requiring emergency to the fact that the stock was not
action. This ability together with in
good delivery form at the time
the know-how and skill developed it should have been sold.
It is
over
years of experience makes most important that prompt attenit possible for the bank to take tion be
given to this very imporloss

of situa-

perhaps drying up the demand. In stock is specifically bequeathed by

examination of only a list of those
securities to be received at a later

from

the^state wlll benefit to

face degree, than ordinarily would be

$13,325

a

result of this preliminary

a

purchase

dluwum

sola, in

jurisdictions the execu¬

he

amount of bonds for $9,993.75?

•

Inheritance

the temperament of the executor,
If he is an experienced corporate

face amount of bonds for $7,500 or
does

nominee.

In many

is

$10,000 "E" bonds with funds of executor, chances - are that, over
the estate to give her. If the lat- the years, his experience will pay
off to the extent that^. under the
ter' does the executor buy $10,000 conditions which exist at the
time,
f
nmdnnf nf hnnris fnr <R7 ^OO nr conditions wmcn exist at tne time,

by the great majority of authorities,
[f
In most instances,
In some estates it is not una telephone call or a letter from
usual ior the decedent to have
usual
for me aeceaent
nave
your attorney will eliminate any owned a
large block of a particmisgivings they may have and ular stock
which, although listed
transfer will be made, perhaps on an
exchange or traded overreluctantly,
to
your me
counter, could^not be sold in
couia not oe
transfer agents.

pressteg3 the current qurtaHon

It

what is "the grade?". No one can
honestly say. Much depends upon

estate. Does Sally lose her legacy
or
does the executor purchase

pUrpOSe

should

Transfer and

Paying
Agents that all future communica¬
tions

sidered

undue

also be taken at this time to advise
the

than those which

restriction.

executor is put to the test: Some
make the grade, others do not.

+

tible issues prior to their rapidly

executor

when in this area that the mettle of the

arises

,

rignts and

indemnification

full authority and
retain securities and to
sell, invest and reinvest the pro¬

rvl!!f+

tne

proper

power to

States. Despite this, you? will find rities by these specialists. When the will says, "I give Sally Jones,
a few corporations who are prone this happens, as it very often does, $10,000 Savings Bonds, Series 'E'"
~ 1° be a bit stuffy in that they will the executor must determine the and the executor can find no such
J; decisions relative to as^ for papers or affidavits other value he will use and be prepared* security among the assets of the
or exercise ot
.

Th_

ta^t inciilLr S

of

holding the exeeutbr harmless for
any loss which may occur as the
result of a decline, in market values. Should the will provide for
retention, the executor must then
use his own judgment as to which
security, if any, he retains for

my 100 shares X Y Z Company distribution,
s,tock. ,to John Poe;" Which stock
Most newly drawn wills give

of
from two or
dealers who specialize in the

Darticulir fes'iio

have

Nominee

possible

iritis

to the securltles aie

re-

common

to retain, securities owned by the
decedent
and
to- make
such

decedents make specific bequests
traded
over-the-counter
Present
of. securities. Sometimes, there is
essary and is obtained in all cases, j.,.,
- Drobiern
However in
considerable doubt in the execuIn some instances, an uninformed
those instances where it is 'net t°r's mind as to exactly what the
co-executor will resist the idea of
bossibie to obtain valuations from testator meant when the security
transferring securities to the name
commonlv accented nuhlieatinn
is inadequately described.
For
of a
nominee but after patient
js necessarv to obtain them in' example—"I
give and bequeath

reasons it may

not be

the

responsibility for

their

current copies of

be

can

at least five years previous is a
prerequisite. However, these will
not
necessarily show the real
value of the enterprise. Perhaps
the decedent, himself, with his
personality and connections rep-

safekeeping. He also creates,
market situation which otherwise for
himself, the good will of the
would be lost due to the delays survivor by making prompt deinvolved in obtaining the neces- livery,
sary papers required, by transfer
:
Inventory

the bonds and. stocks owned by a
decedent
as
soon

advantage

execu-

exe^htor. is relieved of

ment's notice, thus taking immedi

fav^rahiP
tavorabie

in

the rightful .°wn.e^*
t.

Investment

to the

take
steps to have these

the burden of their

An

of

is

securities reregistered
?

executor and trustee.

lt

advantage to promptly

the

or

An executor or-administrator of
a decedent's estate may or may
not have the authority or power

,

Trust

the

Investment Authority

omtly registered, in the name of to value. A balance sheet as of
decedent and another person the date of death plus those for

the

considerations involved in bonds and stocks owned by a dece¬
dent He distinguishes bank nominee (nominee registration)

serve as

of

.Question—Does

gardless of whether they are in ceive nothing
the form of corporations or part- stock?

Securities

An ABC of what

fiduciary is best suited to

time

Family business enterprises, re--the legatee named-in "the will

Reregistration of Jointly Owned

Philadelphia, Pa.

porate

the

at

branch'in EniS ™n;>iderappraising the security gSrtSfe death na su^uri^
1'or two points below the
rea* ta^e4°"t grants bf representation market Wtatiop7'fhi™method is held by the estate for the Sfel
Ms
*
fornthemSale 0f 11118
°* 88861
SI*}? Justifiableonly-will? conve^"the: security Into
special situations.
common
'

Investment Officer, Girard Trust Corn Exchange Bank

from beneficial

but

9

32

The Commercial and Financial Chronicle

10

Outlook for Mortgage Financing
In Nation's Economy oi Today

.

told they

are

'

facing growing competi-

are

tion in conventional mortgages on-non-residential property
from savings and loan associations and from insurance com-

;
.

are

states in which they

of the

laws

-nr»i

orilir

w»

primarily

mess

everything possible to develop a. ;*

that past

favorable climate for introducing,

„

We are making,
good progress. It means, of course,
that we must continue to work for
the full cooperation of investors,
and
state
officials
to
develop
legislation that will have their
this

legislation:

consider

maust

it always

least

single

from
two

mt

"

long

than non-farm sector.

in the orig¬

MS

portant busimess recognize,
are

vre

Vv ttner

gen¬

v..

public interest in the inter-.urate.per,homr::;OiJ-peB*piece.- But it
of .wages, >: prices, .-could also, mean, the weekly wage
k®®11
aiid the monthly salary, both^of
increased in the last few,
-

to

day

Outlook

day market in our planning. The
conversations we are having with

f}x

produce completed mortgage loans
for our investors in four to six
earliest.

the

at

order

In

that the builder may proceed

with
bis plans he must have some defimite commitments as tc the availability
which

will

loans

Unfortunately,

political

.

in

a

seems

that

economy

him.

to

are

we

control inter-

to be true that control has
to

not

produce

higher prices
than lower, both in purchase price
of homes and in interest rates. For

cxampje, there is plenty of evi-

on

that

the

VA

houses than would have other-

gether.

Today,

there

loans

is plentv

could

eliminated

if

be

of evi-

reduced

interest

not controlled.

For

r

rates

FHA loans still

command

deal

of

great
con-,

in income taxes,
wage,
which is the money wage minus
and

the

from

same

.

? **2 JiS- i?
pew housing sta ts we e
conventional^loa sr

the' "real""

derive

so

the rise in prices and in taxes.

j. y s e s
which ' have
a

n

Ewan

Clague

-

-attempt

been

periods for Commitments. Every
Mortgage Banker has the responsibility to his investor, and to the
industry to participate in the CAP
program, as soon as it becomes
available
in -his
territory.
B
wp

nr

Determining Productivity

If

Nevertheless,

prices

and

wages

cuuuuueu*

are

"j

com-

stand

the

workings

of

hi^naHK;

h.w

wo

are

.

,

,

.

u

•

k

.

amnnt?

pron-

i

.

,

.

the

institutions

position

to

that

~ are

in

these

make

The Federal Intermediate Credit

the

larger

Banks

are

offering

today

not

(Aug.

enough

good

to

do

and

must,

the. lack

,

of

precision in

therefore; seek

new

rates .than home

Sav--

owners.

much

i

—.

_

.

.

„

_..The'new issue.is
through
John * T.

.

.

'

the

we

economy?"?" There

...

are

several
..

,

^ ahd: eaRh

..$?■ SWv
i+^°r exa^P
productivity ^ the economy maR
be increased because each indusTftr

'liiiffhcit'

nVrrmric

AiiTTMif'

^oid losing this part of the conveutlonal loan business to the

Give us a free interest rate, distounts will soon disappear alto-.san?«

.

...

-

which handicap

thinking,, but

,

,

.

,

...

us

•

...

r|™'eit %nsumer"tivity °f the"economy.---:^. -.3

o" wholes^DricIs"^" h

e" ' So Mr I have defined prodnc

'

and services; it reflects the weight--5?22veiih
or ^importances attributedto ;n fl'°.m }^e
McDonald ' Fvan* fri'f itemsRby * the" average; consumer
I

.

jn expressing ourselves'to the gen-"

,17

.i

.

*

....

•

L

Mrs. J. W. Hernck With :^;Mng

order to

Proye our services in

*

««

^

_.

to devise long and precise phrases produCtiVft^riiMustries decline*?
which are useful to us' in our importance and high productive

mribstfies growi - A productivit
-measurement which takes aeconn
era! duBIic*
T of ^bis'latter could-show a higiie
being offered
-4.1,1^' +1^=^^btiex Tor;ihe economy, and
Knox) fiaal ' For,.€xample,,ttake,.the terms is jn jact;a gain in the produe

securities.

6n

will be hard to eliminate."

woula not understand, so we have.

agent, and a nation-wide selling
Sfhup of recognized dealers ' in

hibrfc-Spbstahtlal

paylng them, with the result they

i

lan-

only

geographically,

V?1™?®,?*,

■'

our

shall

not.

or

is

the beginning
productivity problem. Ho
measure
the'output' o

of the

Another difficulty arises .from

types of loans to pay. their. rela- .»?eSvery ^epi
,
».
' 1-1
Proceeds .from
the
finencing
tively high dividend rates. As we
will be used to refund $135,000,000
all know, corporate type borrow41/s% ^debentures, matuhlig Sept.
ers on larger loans have generally
been willing jto pay higher inter- 2, 1958.

a

this

^

guage.
fn many respects, this is
the savings and loan associations maturing June 1, 1959. They are unavoidable. Our economic terms
.priced at par.
are widely
used in the everyday
are growing very rapidly.- As their
It was also announced tha,t
Js-, business world, where they have
deposits increase they must find
sues
already outstanding with a acquired a varied assortment of
more outlets for their funds. Gen¬
rv-l
1 HKO
erally, they lend in a relatively
area,

productivity

job

the

But

which is needed.

.

have gotten into:
new mortgages
nonfee habit of requiring discounts, residential, property. We must
the public has been educated into develop, our techniques and lht''

^nd

eco-...

our

nomic system and thereby help to
make it work more effectively.;..

px-

ran

,

--oping

.•-

wra,Mrf»w-,, iiihffl-r -Vf«irit.r.--Vf

must be made if we are to under-

mn<?pnsn<!

willing to make con-* bigs .and loan associations
loans
carrying ,Jl)rpughout the^country are devel-

rate?

power,

tract the changes

economic
a

purchasing

is, the real .wage. However,
could go even further and sub¬

we

result-'

fusion

ing

resents worker
that

■
have no available figu es
manv
difficulties
P
0vT.
^
Refinancing or financing of exist- Ort/ihpr or j\ovemoei we can ex "lTherj
Nnwmhpf
f
"?any aniicuiues been historically useful becausq
October
whiCh stand in the way of an ac0f
its
close
relationshin' to- the
JI?g homes, but I am sum we wi
pect the
to
7
1 ciose^ reiaiionsnip vo me
ap agree that the perce age of tinnwidp program fhp be on a na- PPntahlp .consensus among econ- standard of living.
Tf
tionwiae ha«i<;
Dasis. it tne exneriment
experiment ceP.tat)le
omlsts as to the facts and their
v,
conventional loans is much higher
on existing construction than it °?.usmf ;h'f P'an ln the fntl;e interpretation,
One basic dlffi-, H
S
state
of
Colorado
proves
to be
^ c„wini0nt cto.
duction are necessaiy to obtaip
is on new housing.
up
A
•'7 culty is the lack of sufficient sta^
successful, we are hopeful that it Mistical data to deal with the prob- °-utpu^ and in5exfs,?f outPu^ per
+Whfre do mortgage bankers fit can be included as a program for lem while it is true that we have man"h°ur reflect the combinamto the conventional loan busi- metropolitan communities in ad- far more statistics than^we-'ihad ...tion of ..factors of land manageai2+-W2
111 clition to those communities of less before World War II we still have men^ and capital as well as labor,
*kat highly competitive field.
than 15,000 population.
Vast gaps in our basic information.,
2,1^c
First of all, let me report that
i. i
Consequently, the statistical tools ^
causes of pioductivit> gams,
on the larger loans, non-residenFIR Railk riaCe I1pI|«
tial, we had'the field fairly well ■ III DanRS Pitt* UeDSi which economists must use to an- lt;i?h lmP°rtaI^.t'latjafcn°f
alyze economie developments are whether we are improving ou
to ourselves because we represent

in- 1.est

same

V Investors, too;

.

a

of

wage

Carried a step fur^
ther, the weekly wage modified
by the Consumer Price Index rep¬

there has

been

the

sqnal income.

jpast: few

always

the -employer

of

the

point

<

are

Ventional
the

or

were

example, why

.discount When the
'vestors

g-

months. How-;:

the

know that for the first
t

-

restricted

dence that 'discounts oh FHA and

tnust

s

.

Ending FHA-VA Discounts

VA

e

n

the

Conventional Loans

ap-

wise been true if selling price and
valuation had not been tied to-

I.

i

s

ever?

mortgages. Currently, however,
A^niss^eo'^appi:oximate}y
jpraisal practice in its initial "stages we have two competitive factors $116^00.0,0.00 of) 2.30% nine-month
established higher selling prices that are becoming stronger. One, .debentures dat?d Sept. 2, 1958 and
show

to

dence

u

From

pay.

rate is a labor cost; from the point
J of view of the worker it is pei'-

downturn of

available
through the FHA offices. This is
our
opportunity
to
show
our
ability to be underwriters of high
percentage, long-term mortgages,
It is an opportunity for our industry to grow more important,
This added responsibility, if propservice

the

b

of

view

arid

" jn

now

we

can

r

legislation rather than
by supply and demand factors. It
tended

of

future

Here

born.

opportunity to
show
do in providing fast

the
we

was

0f

1955.57

Certified Agency Program.
the greatest advance for
industry that has been made
FHA

rate

pansion

pro-,

is

since

hours of work in addition to.

.

est rates by

seems

our

the
ex-

jn

.

made,-and

be

feel it necessary to

>at

terms

such financing to

of

cost

the

funds,

of

for

Do you
.

builders and developers today will

months

the

long-

the

banking business?

'

-

the

of

about

FHA

new

years,*«which reflect the influence of,the

j30tn

jjygjj^ggg

l,buuit

mortgage

erally four to
6ix months ahead

at

look

immediate

the

for

how

problems;
term

to dictate

interest rates.

much

So

the purchasers,
control over the

for
of

without having

mrealistic

im¬

this

of

.

plenty

narket

phase

inating

This

have

"safeguards

a

^

•

•

relationships

gram,

what

.lave

have

now

Both VA

FHA, because of their aporaisal
techniques and built in

of

most

builders

Give

and

outlook.
As

years.

will be fair to everyone.

term

-

a new

We

at par and competition will
evel off the prices on a basis that

the

and

term

in the purhome over the past

increase

cost

several

short-

the

is the biggest

1

•

a

hicftJPCl

flia

io

money

refer

I

view.

to

This

jhase of

of

points

fPhi'p

Uahha

house.

the

few years of heavy capital investment will bring
productivity increases in next business recovery. Observes; agricultural man-hour -output has risen much ;;faster,
about

-

reasonable chance
approval when it is introduced;'.
Vi

of

in past two
years^ the economist seriously doubts this foreshadows a new lower trend in the future when it is
expected

•

domiciled. The MBA is doing

are

x
taken are very seldom in the best of
interests of the borrower. .
(2) Many of us have built a
Improvement. Those who are conA 5% discount on a GI loan of substkhtial patt of our sfefvrce
cerned with the mortgage busi- .$15,000 has added $750 to the cost
portfolios on VA and FHA loans.
annnn

-

-

all predica further

indicate

to

seem

■'

•

*.

blessing, and
Business is good and

>Washington, D. C.■ •'

-

Wages-prices-productivity study of nation's overall perform¬
What are some of the solutions ..."
ance
available to us?
presented by U. S. A/s Commissioner of Labor Statistics
Y ■-/;
; reveals markedly divergent performance since World War II.
(1) We must secure legislation y.
permitting our investors to puri.- Mr* Clague points out wages rose faster than productivity in
chase
conventional loans
on
a
the non-farm segment of the economy, since 1954 whereas
higher ratio of loan to value.
•
wages followed closely behind productivity gains from 1947
This is a state legislative probthrough 1953, and unit labor cost rose above price increases
lem because the insurance comduring 1956 for the first time in the postwar period. Though
panies and mutual savings banks
are
governed by the investment
;
unable to explain comparatively poor showing of
productivity
.

ing the same rate.

tions

Commissioner of Labor Statistics, U. S. Department of Labor
•**-;:

v ■;

»

ting investors to purchase

'

.

*

.

(Speciolto The Financial Chronicle^

'

The Wholesale Price Inof commodities Only
services: Nor* does this

family.
dex

C0nsists

?n°^nI

f

1

per

VY°^dS'

"

hllTl ^Creased pi OdUC

-tivity r-is-.n reduction.) in l^o
asso-'Hex:'reflect changes4 ib" the nrices c°sts*
Hence, it is- equally -vail
gether, and the borrower will not
ciated with McDonald, Evans &
-of i'and or Gf buildings; For piir- to express productivity m a Te
foe paying any more for his borMortgage Bankers must also be Co., 1009 Baltimore Avenue, memp0ses of our discussion, I'shall use
verse way, as rniaii-houi^s per urn
rowed capital than he is willing concerned about the tendency of
bers of the Midwest Stock Ex-

degree as. the conventional
resldential business,

to pay.
We must not give up our efforts
to

free

the

interest

rates

legislative and administrative
'

trols. They always act
and

too

late,'*

and

from
con-

"too little

the

actions

■

♦An

address by

Mr. Nelson

before the

&
4n

M.

Stanford,



some

insurance

companies

make the larger loans
basis,

on a

to

direct

eliminating

the

loan correspondent from
transaction. We must build
service, our contacts,- and

the

therefore

our

ability, prove our value not only
to the borrower, but to the lender.

everywhere that the "COmmunity recognizes the value of
6rs

JCANSASCITY,Mo.-Mrs. Jew-

ell

W.

Herricl^.has

_no

become

both

change. Mrs. Herrick has recently
been with Barret, Fitch, North &

,was an

cer

of Barrett Herrick &

our

b°a. " * important to Mortgage Bank-

with Stanford University,
Calif.. Aug. 3, 1958.

cooperation

i-

i.

,

■

advised to: (1) support legislation permit¬
conventional loans on a higher ratio
of loan to value; (2) participate fully in the new Certified
Agency Program; and (3) impress the public with the value
of local representation for larger institutional investors. The
Minneapolis mortgage banker believes FHA-VA discounts
would be eliminated if these mortgages were freed entirely
from artificial interest rate control and pointedly asks why
these loans now command a 1% discount when the same
investors are willing to make conventional loans at par carry¬
panies. They

r-,

••

Solutions Proposed

Mortgage Bankers Association
Eberftardt Company of Minneapolis

Mortgage bankers

.-f

Thursday, August 14, 1958

.

By EWAN CLAGUE*

A

of it.

Vice-President,
President,

stitutional investors. We are im-" f
portant
in
the financial community of this country. Make cer¬
tain that the public is well aware

;

C. NELSON*

WALTER

By

1

.

representation for large -in-/.-..

local

*

-

.

(606)

business H (wholesale)

consumer

j

and

(retail) prices, although

recognize that these are not all-

inclusive

Co., Inc.: situation

-■

indicators of = the price
in4 the
economyi'; as ^=a

whole.

Thomson McKinnon Adds
(Special to The Financial Chronicle^

CHARLOTTE, N. C.

—

?

Take

;*

Howard
"

G. Hunt, Jr. is now with. Thomson

&t\t/->t/"j>-it
,
McKinnon, Liberty

t -j!
Life

-nu
Bldg.

-

*

for

wages

ample.; This
An address

may
f

r

another ex¬
the wage

mean
•

by Mr. Clague before 4th

Annual Industrial Relations Conference,
Arbor, Mich.

Ann

df product,. which- miden improv
1TRg efficiency would show a de
ciine over^the'years.
- ;
*
In the midst of" all

these vari

meanings it is difficult to presen
economic
analyses
which * ca
fully interpret economic develop
ments in
this, country,^ or eve
analyses
modicum

which can. command*
of -agreement. Never

Continued

on

page

3

Number 5768 ".

Volume 188
$-

1

*"*

■

'

•

1

•

i

.

The Commercial and Financial Chronicle

.

.

•

(607)

lishment

Sterling's Continued Firmness

News About Banks
-

.

CAPITALIZATIONS

Bankers

and

NEW OFFICERS, .ETC.
REVISED
•*

PAUL

By

EINZIG

,

peared
to

Louis,;; A/ Gomez
-

Vice-President

/c h a

in

.-

of The

elected
r g e.J of

France,

77 7!

Charlottesville.

.

branches in Panama of the Chase
Manhattan

New York.

Bank,

succeed " retired

Will

Healy, Jr. 7.LI;'• ••.*V?• 7 7'* -'

}'■

ginia, V Norfolk,Va.

John'" W.'

has been
elected'" Assistant * Vibe-President
Heilshorn

:■

the

the

corporate trust division'of

New •;

Co., / New

Trust

York

Vice-President. V3

C >irf

York.

By

3

Whitney,

Wadsworth

Henry

Trust* Officer

in

the

a

mon

Bank

City

77

j

:

*7*

7
r

•

7„

'7

tional

of

Bank

111.

Lansing;

of autumn pressure

eve

stock dividend, the com¬
capital stock of the First Na¬
a

sterling, and notes official

on

agement to British banks' participation in

J

was

Triist7C».7 New- ? York increased from $100,000 to $200,died Aogv 5. His age was. 51'.
»
000, effective July 28; .(Number

;

their

;

of

/The. New

Savings

York

Bank,

from

the

.Railroad

the

New

York

has .leased

New

York

Central

shares

.

shares,

outstanding

paw

.—

LONDON, Eng. — Sterling re¬
mained
remarkably firm during
the early part of August. By that
time of the year the foreign exi
> change
m a r-

10,000

value $20). 7

„

Worthington "National

The

ket

usually
begins to an-

corner store at 466 Lexing¬
Bank, ^ W e r t h ingto n,. Minn,
Ave.;.at East 46th Street, for changed its title to First; National
ijts;';: .first Grand/ Central V a r e a Bank in Worthington,- effective
branch,i it was announced; Aug. 12/ "July
Sip.7777
I The new branch is scheduled

large
ton

to open January, 1959.
7 Main

office

of

be

negotiations,

7

branch, office

other

of

the

Rockefeller

in

located

title

its

Cashier
visor
of

S.

the

bank

7

11

Highland

Park,

Bank

J., "died

N.

Aug. 6 at the age of 69.

/'It

Montgomery /C

the

that
The

of

Pottstown,

Bank of

National
arid

Directors

of

Pa.

t

ou n

y

Bank and Trust Company, of Nor-

into a
jioint plan for the merger of the
r is tow 11,

Pa., have entered

The announcement by

two banks.

GeFStld M. Anderson,- President of
of Pottstown,

The National Bank

Melvin L.

Carl-, TPresident of
Montgomery
County
Bank
Trust Company, states that

and

the

t

,

and

L.

,

King,

California ! Bank,

Calif,

that

im¬

of

national

political

their" there
re¬

quirements.

this

they

year

done

so

cause

Di; f au!

Linzig

be¬
they

thought that

.'
the firmness
offer whereby
First-'
of sterling was. too good to last.
america Corporation proposes to
As a result,>. commercial demand
acquire 80%, or more of the out¬
for' dollars may be less heavy this
standing stock of California'Bank','
late
summer
and
early autumn
The : understanding
contemplates
than in other years." Even offi¬
that !an offer will be
made by
cially stimulated pessimism about
Firstamerica to the shareholders
,

Bank

First-,

stock for. California Bank

at

stock

of

shares

issued

newly
aril erica

exchange

to

ratio

a

shares .of

3.5

of

Firstamerica for each share of the

approximately 1,550,000 shares of
California Bank stock outstand- ;

7

hig.

the prospects of a
sion

failed

has

business
far

so

should

inter¬

the

sphere,

be

if

and

substantial

no

recession

that case sterling's firmness is
likely to continue.

measures, affected sterling
the time of

The

Bank

chances

Rate

that

are

the

of the autumn pressure,
be a most unusual

eve

raw

that

fear

It would be based
tion

that

the

will

more

lars

au¬

need

not

There is

an

that

so

factor

the

demand

com¬
dol¬

for

necessarily

on

cause

this occasion.

in commodity prices has helped
sterling,
because
the terms
of
trade have changed
in Britain's
favor. But the price for this gain
will have to be paid in the form
of
a
decline in the imports" of

countries and

Commonwealth

other

material

raw

producers.

result

a

Communist Bloc

the

ports to

of

revision

the
.

-

decision

American example by

the
an

Ira U.

Cobleigh Gels

"Man-of-Year" Award
Being

ardent devotee of an¬

an

onymity,

it

was

that

learn

of

one

to

illustrious

our

columnists,

a

Ira U. Cob¬

•

of

be expected

to

that only by chance were we

leigh,

was

given

the

"Man-of-the-

a

award

Year"

taking

his

by

instalment

in

interest

active

credit

as

the

of

■'

expansionary mood
The

evidence.

in

taneously
is
attributable
to
three
main
cisco .'by'Mr.
O/H. Keller,^
causes.
The ..most obvious amongst
President of Firstamerica Corpo-',
State and Federal supervisory au¬
them Is the anticipation of infla¬
thorities. v
7
; ;
I ration, it wasemphasised -that \
tion'in the. United States.
Until
no
offer can legally; be made by
;<The published statements of the
recently practically all prophets
Firstamerica Corp o r a-t i o n to.
two banks' as of June 30, 1958 in¬
predicted an intensification of the
of stockholders of California Bank

of

level

move.

than outweigh the com¬

depreciation

to

Hardening and

low

material prices will affect ex¬

number of British banks to follow

's

.<*

horizon

trade to raw material pro¬
ducing countries. Hitherto the fall

the assump¬

on

the psychological

factor,

71.J Dollar's Softening
;
announcement, simul¬
Sterling's unseasonable strength
released "in' San Fran¬

the

on

port

which

would

autumn

up

the

is

cloud

Lowering

thorities might even feel justified
in lowering the Bank rate on the

mercial

writing.

of

Exports to Communist Bloc
The main

contraband list.
Possible

mercial

sterling to depreciate. Nor has the
of
disinflationary

prospects

the

in

In

cause

relaxation

re¬

the

turn

Britain, a' Hopes are entertained, however,
Conservative victory would come that this loss might be offset to
to be regarded as a near-certainty. some extent by an increase in ex¬
business

reces¬

to

r\

the

In

is subject to
the approval of the stockholders
of the two institutions and "of the
the proposed merger

in

success

earlier,

the.:.

tively agreed to the terms-of ail-

California

change

sufficient

been

should

measure

Possibly

Directors of the bank have tenta¬

of

has

are

have

this

still

inspire confidence in sterling.
as is probable, Mr. Macmillan
succeed in showing some

seasonal

President of
Los ,* Angeles,

announced

has

unlikely,

is

to

and

cover

,,

Al¬

country.

election

If,

,

*. V

.

considered

the

the

exchange

Aug., 8

announced

was

the; Boards

*

early

an

beginning to

of

Company

in

though

sentiment

porters

National

.

Snawnee, effective Aug.. 1. "• 7

Center.

National

First

Trust

Bank- -and

Freeman, Assistant
Bookkeeping Super¬

and

of

American

to

.>7 Frank
William

sure,

of

Bank

*

increase in the government's

popularity

a

in

the favorable

British exporters are now viewed
with more optimism..

remark¬

a

mar¬

politically disastrous. As

sult of

pres¬

autumn

Shawnee/Shawnee, Okla. changed

14th
and; Eighth! Avenue! An¬

Street

National

;American

York

located at

Savings Bank is

is

:
;
New

the

was

important continental

splitting of Western Europe into
would

of

ticipate

.

■t

recent weeks there

this

two hostile economic camps

inspire distrust in sterling. But in
able

between

countries

ment has at last realized that the

/

,

was

discriminatory

The danger has now sub¬
sided, because the French Govern¬

Farmers 3

.v

between

Germany

Western

kets.

encour¬

!

;

;

of

might effect
British exporters who had to en¬
visage the loss of a large pbrt of

endeavor of

new

instalment credit financing.

.

of

group

toward establishment of European Free Trade Area; and (5)
hope that decline in exports to hard-hit raw materials produc¬
ing countries may be offset by increased sales to Communist
Bloc. Offers the thought that Bank Rate may be lowered on

J

Newport News, according to Heyward--T. "Denyes, bank regional

..

in

of

and

arrangement

Italy,

tariff arrangements

situation; (3) growing optimism - about British Conservative
/7Government's election prospects; (4) unexpected" progress

Vir¬
V was!
J named counsel for the bank in
News board of The Bank

participation

real danger that

a

7 simisro about Middle East crisis and general international

He V: Marvin M. Murchisoiv Jr./ was
-elected a member of the Newport

•

Edward

J.

the

ap¬

determined

been

and the Low Countries. There

experts. Br. Einzig attributes hardening of sterling to:
(1) Softening of the dollar due to anticipation of greater price
inflation in the U. S. A. than in the U. K.; (2) decline in pes-

Peoples National Bank of

to

agree

proposed

unexpected, unseasonably continued firmness of British
sterling receives close scrutiny from one of Britain's outstand¬

was

.

have

to

Britain and other countries in the

,

ing

vi

Free

European

a

July the French Government

The

;

of

Trade Area. Until the last days of

On Eve of Autumn Pressures

CONSOLIDATIONS
NEW BRANCHES

II

•

•

,

mates

35th

class¬
at

the

reunion

interesting
symptom. For a long time prac¬
tically all banks kept aloof from

of the class of

that branch of business which was

bia

left to smaller finance houses spe¬

held at Ardeii

cializing in instalment financing.
But during recent weeks one bank

House,

financing is

an

1923,

Colum¬
College,

.

dicate
the

the total

that

will be in ex¬

bank

merged

resources

of $92,000,000, with total de¬

cess

posits of $80,500,000 and total
capital funds of $10,000,000. The
trusts being administered will ex¬
ceed

$69,500,000.

plan adopted, the
merged bank will be known as
Montgomery
County Bank and
to

the

Under

The joint

States

that

ployees

announcement further
all

of

continue

officers

the

em¬

banks

two

will

of

the

staff

the

on

and

merged institution. Mr. Anderson,
President of The National Bank

of'Pottstown,

the

Ex¬

of

the

Vice-President

ecutive'

merged

become

will

bank

his office

with

office

main

of

the

in

company.

Mr. Carl,. President of the

Mont¬
and Trust
Company, will continue in his
present capacity. The Boards of

gomery

County

Directors

of

the

Bank

institutions

two

will continue to direct the activ¬
ities

of

the

they

are now

of

bers

offices,

with

which

identified, as mem¬
Executive

Regional

Boards.
*
*
*
i/
A merger certificate was issued
approving and making effective,

ijirr;

as

25,

.

of

Bank

close

of

business

merger

of

The

the

the
of

Gordonsville,

July

National
Gordons¬

ville, Va. with common stock of

$25,000, into The Peoples. National
Bank
of
Charlottesville,
Char-

confirmation
ture of the

tax

free

na¬

Corporations of the fairness of the
exchange offer, and compliance
with all other legal and contract¬
requirements. Firstamerica's
application to the Board of
Governors of the Federal Reserve
ual

formal

But

autumn.

trend

the

of

has changed

widely

during recent weeks
these anticipations

completely. It is

now

that prices

will

expected

rise

their

resume

in

the

United

States. And, even

though they are
also in Britain,

rise

likely

to

British

inflation is expected to be

inferior
Hence

the

American

to

the

inflation.

stronger confidence in

pound. To some degree hard¬

ening of sterling is caused by the
softening of the dollar.
*

The

other

two

of

causes

ster¬

ling's firmness are of a political

another

after

participation

decided

the'

in

that

they intend
tional credits for
instalment

cently
wards

the

the

from favorable. But
now

a

caused

A

memorandum
into

tered

of

between

Intent en¬

Fivstamerica

<

Corporation and the Directors
the California Bank

of

contemplates

mism

to

a

thority in marine transport; a di¬

attitude

to¬

was

far

evidently the

feel the need for

sidiary, would be merged into or
consolidated with California
Bank.

that

It

upon

is

also

contemplated

completion of the ac¬

quisition and merger, Mr. Frank
L. King would become Chief Ex¬
ecutive
Officer of
both First¬
america

bank
the head offices of both

and

the combined

would

be

in

Los

rector

finance.
with

number of books on

The "Chronicle" records

pride

corded

a

and

corporations;

nine

of

has authored

the

the

signal honor ac¬

Cobleigh

Mr.

gifted

and, although it is quite unneces¬
sary,

the

refers

week's

reader

column by our

about the pros¬ Economist

on

this

4 for typical

page

evidence of his great
the investment

to

Enterprise

popularity in

community.

consider¬

and. it is widely ex¬

LOOKING FOR THE UNUSUAL

pected that the international po¬
litical situation will improve in

as a part of the plan of ac¬
the not too distant future.
quisition, and subject to the ap¬
Much more, important from the
proval of the California Superin¬
tendent of Banks and other regu¬ point of view of sterling's pros¬
latory
agencies,
First Western pects is the growing optimism
Bank and Trust Company, First¬ about the prospects of the Con¬
Government.
Until
a
america's California banking sub¬ servative

that,

finan¬

of
re¬

development which has

optimism

the

by the Middle East

caused

crisis has subsided

able degree,

of

cial scene, Mr. Cobleigh is an au¬

business.
new

Cobleigh

,

addi¬

encouraging demand, and to that
end the banks have been allowed
to embark on this new line of
A

U.

Ira

means

purpose

credits

Harri-

N.Y. Be¬
sides being a
keen
analyst

man,

of

Until

financing.

instalment

authorities

grant

to

official

take

This

finance houses.

these

to

capital

the character. They are a revival of
proposed acquisition under the optimism about the political out¬ pects is the unexpected progress
the
international in the negotiations for the estab¬
Bank
Holding Company Act of look both in
1956 was filed Monday, Aug. 11. sphere and at home. The pessi¬

System for prior approval of

organizations
Angeles.

ef¬

of the

exchange, approval by
Commissioner of

and that

merger was

wide range

a

California

.lottesville, Va., with common stock

fected under the charter and title

on

governmental clear¬
ances, including Federal Reserve
Board approval of Firstamerica's
acquisition
of
additional
bank
stocks, Internal Revenue Service

7>£ $1,718,960. The




receives'

Firstamerica

after

required

of

the

Trust Company.
i;

until

favorable action

American business recession in the

month ago

most people took it for

granted
that the next election
would bring back a Socialist Gov¬
ernment. And even though it was
believed
w.as

not

result

that

general

imminent,

cast

The bare

a

its

its

shadow

possibility of

election
probable

before
an

it.

early

election—which could not be ruled
out

altogether—was sufficient to

Beautifully Bound Set of
Commercial & Financial Chronicles,

1920-1945

"FOR SALE"
Available in New York

Phone REctor 2-9570

!

City—Write

or

Edwin L. Beck

c/o Chronicle, 25

Park PL N. Y. 7

The Commercial and Financial Chronicle

12

.

.

Thursday, August 14, 1958

.

(608)

Railroad Leaders View the Industry's Outlook
Continued from

most railroad labor contracts will become

first page

Nov.

pleasure recently of participating in the dedication
opening of one of the many new "electronic" yards

the
and

being built throughout the country. Equipped with the
ideas in car handling such as electronic car re-

latest

tarders, radio and television

communications, and elec¬

safety devices, these yards are the means of pro¬
viding better service at reduced costs.
Other techno¬
logical improvements designed to improve service and
cut costs are being adopted. This is the way to win
friends and influence people. There are also reassuring
tronic

signs that mergers beneficial to the public will be pro¬
posed, and that the elimination of costly duplicate facili¬
ties will be explored.
It is, however,

unrealistic and fanciful to assume that
of 1958 are favor¬

all of the indications for the remainder

Rising operating costs, due primarily to higher
prices of materials and supplies and increases in wages,
loom as a major railroad problem. Passenger revenues,
down 3.5% in 1957, will almost certainly be even lower

able.

this

The steadily growing passenger-train

year.

deficit

spells continued trouble for many of this country's rail¬
roads. However, even in this depressive area there are
signs of progress. The experimentation of the railroads
in this field, the increased awareness on the part of the

public of the seriousness of the passenger-train prob¬
the recently enacted law giving the Commission
jurisdiction in certain circumstances over elimination of
passenger-train services^ and the Commission's own in¬
vestigation into the cause of the passenger-train deficit
all add to the prospects of a solution of this perplexing
lem,

,

whole the indications are that condi¬
in the railroad industry are taking a turn for the

Although
tions

as

a

individual railroads will continue to be
financially. Under recent legislation gov¬
ernment guaranteed loans may be authorized by the
Commission up to a total of $500 million.
better,

some

hard-pressed

;

From

a.

increases to

on

business conditions gradually improve, the
upgrade their equipment to re¬
duce the bad order car situation. There should be some
noticeable increase in equipment orders, and improve¬
ments to fixed properties will go forward where the

far beyond their present state.

ALBERT

GEORGE

As

start the month of

we

Railroad

New Haven

has

August, 1958, I believe the

encourage

of state statutes

work

the

seen

of

to

the

with

the future

worst of

the effects

ex¬

W.

relief

tax

subsidy

and

for the

RUSSELL

railroads

is

now

on

the

with

results

concrete

ready achieved, the mail

Indiana

is

another

hope will be acted

essential

that

by the ICC
finally

the

on

June

23,

have

the

business.

under the

longer*

We

will

I

enact

months of 1958

.

by

our

carloading promise

and

1958

a

receipts from connections down 10.1%
crease
of 7.8%, as compared with
same period last year.
When compared with national car-

and

the

railroad

figure

which

K.

The

railroad

industry

favorable climate this

might

continue

place in the Southwest in

been

do hope that
legislation. al¬

major

a

Pacific

factor

While

there

JOHN

that

the

most

tion

thus

far

encouraging
in

remedial

ATKINSON

1958

found

faded

a

are

and

the

to

20

to

and the
Arthur

K.

Atkuutoo

This

the

we are now

only
year's

way out

of

the

well

is up.

favorable

legislation
affecting the transportation industry
falls far short of being a cure-all. In fact, if the present
Congress sees fit to enact certain proposed amendments
to the Railroad Retirement and

Unemployment Insurance

Acts which would increase the benefits to railroad

em¬

ployees and raise the taxes applicable to the railroads,
the net result would
leave
the railroads financially
worse

The

off.

third

annual

seven

cents

hourly increase

under

so

transporta¬
Congress of

confidence

was

Congressional
in

that

he

widespread in the

my

of

attention

national

to

the

in¬

transport

are,

opinion, of greater potential

benefit to the country. The hearings
the condition of the transporta¬

on

tion

economy, initiated by Senator
Smathers of Florida, smashed a big

hole

in

the

wall

of

public

apathy

toward the problems of the
A tidal

wave

insistence

on

of public opinion
supporting our
fair and equal treatment

state governments

was

and reflected in the

railways.
industry's

by Federal and
generated by the American press,

record-making flood of requests

on

Senators and Congressmen for
positive action.
That public

government

transportation is costing the

much

more

than

stood by a greater segment of
ago

it

should

our

users

now

and the

is

citizenry than

under¬
a

year

thanks to Senator Smathers and his associates.

The

second

country is

by-product

the

Senate to dig




but

do

firmities

look¬

a

bottom

in

the

Although the legislation awaiting
Presidential approval is helpful and
appreciated,, two
by-products
of

railroad

at

by

industry.

busi¬

30%, there is the feeling that

are

development
passage

prepared,
would

nation-wide

a

After experiencing drastic reductions
in railroad traffic volume of from
we

was

hower had not signed the Transpor¬
tation Act of 1958 as this was being

more

healthy recovery.
industry, the last
half of 1958 may not in itself com¬
pare favorably with the same period
in 1957, but there is a greater degree
of
optimism for the longer term.
For

signs

which

horizon

restore

action in the future. President Eisen¬

new

into

recession,

ing forward

Missouri

well-

a

.

apparently
on

would

-

:

some

business

the

indicate

that

expressed

of

promising

intent

of

and

the

economy

slowly

is

Russell

L.

Dearmont

improvement will be felt to any appreciable extent in
Missouri Pacific territory this year.
Despite reduced gross revenues, increased expenses to

BUDD

legislation, and prospects for additional,

Company

when the prospects for a good
year

M.

Railway management generally will agree, I believe,

as

business

re-,

the bottom of the recession has been

President, Great Northern Railway
»

taken in Congress to repeal the

ness

optimistic
Warren W. Brown

run.

evidenced by the actions
3% tax on freight trans¬
portation and the passage of the Transportation Act of
1958. By comparison with the dismal
experience in the latter part of 1957
year

in

business, makes for

balanced economy.

a day's work for a day's pay,
discontinued and passenger trains

be

to

George Alpert

Railroad

has

de¬

a

working
its
way
up,
I
am
not
sufficiently encouraged at this time to expect that the

some

Wabash

shows

of 20%, it can readily be seen
the
industrialization
that has

reached

trend

would

through automation clearly indicate that when the ex¬
pected upturn in revenues comes, the New Haven Rail¬
road will be in a position to benefit substantially.
ARTHUR

total de¬

this

general.
Large scale consolidations of our
facilities
and
increased
efficiency

President,

or a

,

taken

in

industry

.

...

management to establish

future for both the New Haven Rail¬
road

Pacific territory

years, plus the favorable agri¬
cultural situation, which has always

If the unions would work with

years.

upturn

Missouri

of

fact that for the first seven
carloadings are down only 5.9%
the

cent

cannot

present archaic rules

and

demonstrated

that

right to

lowing all forms of transportation to
be on an equal footing.
Passenger trains will continue to
be
dropped
for
the
next
several

in
much brighter

anticipated

&

crease

on

must

for

Congress

al¬

Portland

Spokane,

DEARMONT

L.

stability

economic

The

is

loading

I

favorably next
by Indiana's legislative body.

much

award

pay

consolida¬
Pacific, Chicago,

proposed

President, Missouri Pacific Railroad Company

.

ments

the

and

Quincy

&

the

on

Northern, Northern

Great

Seattle Railways.

BROWN

upturn, and will continue in an upward trend for
time to come.
I was very disappointed in what
Congress did for the railroads* but the elimination of
the
three
percent tax on freight
..
.
shipments will help to return to the
railroads many shipments now mov¬
ing by private trucks, "v
Repeal of the Full Crew Law in

live

pay¬

the

the

compete

by the passage of the
Transportation Act of 1958, the fa¬
vorable
reception
of
our
3-point
commuter
program
for
increased

of

President, Monon Railroad
business

continues

Consideration
tion

that

sure

Railroads

evidenced

fares,

business set in.

effective

Burlington

year

pectation of improvement.
The change, in the national climate
as

maximum

the

of manpower.

WARREN

its

1958 and

improvements begun after World War II. Much of
system-wide upgrading of track and other facilities
had been
accomplished before the general decline in
of

this

be derived by

and

than those of

of improvements to fixed property and new
equipment. The company's property is in excellent con¬
dition.'We are benefiting from the long range program

fair
other

rules

lower

are

program

allocation of the costs of
highway projects on the
the affected
parties. Third, the railroads must work for better man¬
agement-union relationships leading to the elimination
outdated

earnings

Northern's

1957, consistent, of course, with the decline in revenues.
have been conducting a smaller, though adequate

a

benefits to

real

in¬

We

requiring lull-crew operation and other

laws, and
separations and

of the

net

has stepped up in the past month.

Great

,

territory of the national recession. Although our
losses
have
been
relatively large we face the rest
in

substantial

May

opera¬

and adequate working

crop,

repealed and the enactment of legisla¬
capital improvement and expansion.
Second, they must seek out ways to bring about a
greater degree of competitive opportunity in the transportalion indusff^. This 'WjSbnds on establishing a sys-;
tem of adequate user charges for facilities riOw furnished
at government expense, more realistic and equitable tax,
assessments at state and local goverilfttient levels, repeal i
passenger fares

feel

a

1958

capital. Although the pros¬
pects for the remainder of the year continue to be un¬
certain, I am confident that earlier predictions will be
fulfilled. Harvesting of good grain crops is underway in
Great Northern territory. Movement of last year's grain,
much of which was in storage, and some of the new

continue to strive for im¬

proved conditions in three areas. First, they must follow
through on the effort to have the 10% excise tax on

I

with

concluded

be

advised in

were,

management expected

come

The railroad industry must

some

President. New York, New Haven & Hartford RR.

would

tions

shareowners

company's

the

that

expenses.

use

Northern's

Great

expenditure of available funds will produce the greatest
return in improved operational efficiency and reduced

of

treatment

qualified experts on transportation will
relate to the many facets of the subject, none of which
is more important to the railways than the question of
adequate charges for the use of public-provided facili¬
ties by the commercial highway, water and air industries.
It is within this area of inequity that railways are most
seriously discriminated against, and government policy
on
it must be changed if the health of our industry is
to regain its vigor.

As general

basis

resolution also will be
additional recommenda¬
by the Congress.

the
of

The study by

railroads must work to

grade

developed

corrective

for

tions

supplies, but revenues have never been able to keep
with expenses. Meanwhile, competitors were gain¬
ing strength with the aid of facilities furnished at gov¬
ernment expense and have been grabbing away at the
railroad passenger and freight business.
pace

to

conducted by Senator Smathers'
much important information,

hearings

inquiry authorized by
searching, and productive

and

tion

the

authorizes further exploration

-

the

cover

public

grow

While

subject.

sub-committee

They have asked and waited for
rising costs of labor, materials

uphill light.

an

of

long-range viewpoint, the reestablishment

confidence in railroad securities of all types is
of paramount importance. There are a number of factors
which indicate that this will be accomplished. My per¬
sonal view is that the railroads have an opportunity to

of this vital

a

make-work

problem.

ate resolution 303, which

effective next

require drastic

the part of railroad manage¬
substantial improvement in vol¬
Since the end ol World War II, rail carriers have
there is

unless

ume.

rate

will

burden

added

be taken

to

measures

ment

had

this

and

1,

the

value
United

to

the

States

deeper into the problems of public trans¬

port and government policies affecting it. I refer to Sen¬

washed out sections of the railroad

in June and

July, and the wage increase under existing contracts on
November 1, which on an annual basis will amount to
about $4,500,000, Missouri Pacific expects to end the year
with a balance sufficent to cover all interest charges
and its relatively
large mandatory appropriations for
capital expenditures and sinking funds.
We
are
particularly pleased with the innovations
established to win

passengers

reduced

Pullman

rail

and

meals for coach riders and

T-Sleepers in

our

back to

our

railroad. The

fares, introduction of tray
our experiment with Thrift-

Colorado

Eagle have met with fine

public

response.
While passenger

train revenues are less than 9% of
our gross, I have the strong feeling that a railroad with¬
out passenger service would soon lose public favor, in¬
terest and support. In my opinion, good passenger trains
are

a

showcase that attract the public eye to a railroad.

It has

a

favorable public relations and advertising value
intends to remain in the passenger

and Missouri Pacific

business.

Currently the most encouraging sign in the railroad
is the growing realization on the part of the
public that this vital transportation agency must be
freed from antiquated and unnecessary government regu¬
lation and given an equal chance with its competitors
outlook

to compete for business. The transportation legislation
recently enacted by the Congress is a modest start on
such a program. We can be hopeful that the next Con¬
gress will accomplish even more in this direction. That

Congress realizes the need for further action is recog¬
nized by the adoption of Senate Resolution 303 author¬
izing the appointment of three transportation experts
to study and report with recommendations for further
action

with respect to the important problems
transportation industry not yet resolved.

Continued

on

of the

page

14

Volume 183

Number 5768

.

.

The Commercial and Financial Chronicle

.

has been the

most readers

"Buys

ROGER W. BABSON

By

covery

underwater

Pointers

alternative

on

stocks

ment to

invest¬

it

be

made

where

demand

is

the

supply
Suggests, for example,

cannot.

and

waterfront property.

This

may

or

not

may

be

a

good place to get a quick profit;
T
but
the
best
investment for

the

long

may

be water¬

front

pull

land

your

This

most

a

curiosities

in

or

The

invest
new

the

in

to

mar¬

fish, crabs,
all kinds, in¬

of

wrecks

silver.

of
vessels,
contain pirate

,

to make

way

up

of

of which may

some

gold

a tube
leading
They discover

kinds

new

cluding

people think the best place
to invest money is the stock mar¬

or

surface.

velous

Most

ket.

is

put

their back

and

increase

to

acquainted.

long plastic fins on their
feet, and either a can of oxygen on

Babson who advises investments

bound

are

exploring

fascinating sport which just re¬
cently started. Those engaged in

given by Mr.

are

opment of electricity.

ploring have taken the place of
playing on the beach or in the
"old swimming hole," with which

u

Best

(609)

is

money

corporations

in

to

some

industry of permanent value.

When

I

railroads

was

a

that

later, water

boy,

held

it

the

power and

the

was

glamour;

future

lakes,
far

Recently it

deal

with

the

dis¬

has

and

Thus

oceans.

done

been

by

hap¬

hazard dredging, but in the future
it will be done by underwater

diving.

^

-

if

Therefore,

you

property today,

try

do not sell it.

To make money in

any investment, buy into some¬
thing for which the demand will
increase and where the supply is
more

or

less

limited.

dollars will

our

of less

value

Henry

The

in

printed

The

unlimited

is true of good water¬

reverse

the devel-; front property.,

...

the

has

formed

Distributors

Trdst

change Bank

Coveney is

engaging

15th

in

Street, N. W., under

name

of Andrews

Y. —Robert

Carl
&

ing to engage in

securities business from offices
927

N.

and

Forrest

E.

& Co.

a

Mr. Forrest

ness.

securities busi¬
was

with

which

Mr.

Nagel

stock
am

im¬

railroad

stocks

and

auto mobile

Roger W. Baboon

stocks

out¬

vs.

board motor

stocks. -For

instance,

the first
mortgage 4% $1,000 bonds on the
New York, New Haven, and Hart¬
ford RR.

$450,

General

be

can

at

or

bought for about

discount of

a

Motors

50%.

over

sells

today just
year ago/ while
Chrysler sells near 50 today com¬
pared with 78 a year ago. The Ford
Motor Co. has just reduced
the
under the 45 of

a

dividend

stock/,

its

on

i ;

:

•

While declines have taken place
.in the stocks of companies whose

•product operates

wheels,

on

a

big

advance has taken place in motorboat
stocks.
Outboard:,

Marine,

adjusted
creased

for
to

stock ,splits

has in¬
price of 25 from an

a

equivalent 234. in 1953, a gain of
J,000%., ' This is because people
are tired of using automobiles for
pleasure driving, owing to crowded
.

;highways, lack of parking

space,

and

Fami¬

lies

increasing ^ accidents,
get

more

small

a

and

peace

outboard.

In

quiet in

short,

the
becoming largely a
the glamour of

.automobile is

business accessory;

driving is fading
fundamental

This is

away.

a

for the decline

reason

in automobile sales.

Waterfront Real

There

1

land

will

to

buy.

tended,

As

the

the

as

are

ex¬

constantly

market. "Interior

land is like money;

just

interior

be

roads

land

more

onto

comes

Estate

always

it depreciates

dollar

does

unless

backed

by increased population
industry. But, there is only

and

much waterfront property.

so

There

be,

never

and

never

will

more/This is another

any

rea¬

was,

CLIC

why

waterfront land, where
located, is probably the best
the long pull for
both residences and industry.
Cities and towns bordering oceans,
lakes, or rivers will continue to
son

ever

keeps a -finger on your car

investment for

and

grow

their waterfront

prop¬

erty will continue to increase in
value.
As

an

illustration of the increas¬

ing popularity of water, note the
advertisements

for
backyard
pools which can be
bought at department stores; Chil¬
dren at a very early age are being

swimming

educated to love the

popularity has

has

built

prob¬

ably the best swimming pool in
England, costing over $200,000, to satisfy the demand for

New

water

sports

and

to

make

or

I

was

spbrts

a

boy

journey it will be

tracks. Tell your
you

on

know when he gets

a

on

the phone to tell

you

has

hat."
taken

while

The

the

outboard

place

of

have been

reasons,

CLIC

the

con¬

what

dependable report

on

over

reason

motor

rowing;




satis¬

where

enough for routing

the C&O. But there

too. C&O's

are

other good

smooth track and careful han¬

dling minimize damage. And C&O's fast schedules

made possible by

mean

(Car Location Information Center), C&O's

early, dependable delivery.

Would you

like

a copy

of a booklet describing CLIC? dust write:

only

sfciijpg and underwater

a

day before yesterday.

CLIC alone would be

just where it

ancl when it will be delivered to you or

3807

were

the

to

C&O

freight

necting railroad. Such service is

reporting system—the

is right now—not where it was supposed

your car
on

is, when it will arrive at the next junction point,

rowing a boat
swimming; but today these are

"old

faction it is to get a

report of it.
comes

car

system that really works. Try it! See

C&O freight representative to let

Within minutes of the time it

rails, he'll be

exclusive, all-teletype

that somewhere

Chesapeake and Ohio

Chesapeake and Ohio Railway

Skiing and Other Sports
water

its

sure

that every student who graduates
can swim like a fish.

When

on

This

water.

spread that the

so

Institute

Babson

First time you can, route a car so

ex¬

SHIP

TERMINAL TOWER,

C&O,.

..AND

CLEVELAND 1, OHIO

WATCH

was

associated for many years.

pressed by the
relative action
of

formerly

a

partner in Forrest, Hammill & Co.,

Speaking of
I

W.

have

Company with

■-

greatly

Nagel

offices in the Liberty Bank Build¬

WASHINGTON, D. C. —Henry

at

BUFFALO,
Forrest

o wn

market,

Dakota
with of¬

Company Opens
Buffalo, N. Y.

neighborhood.
the

Co.

In

formed

.

Forms Andrews Co.

a

Forrest &

and

the firm

.

Vandall

Income

Company of
prior thereto was
with
the
Municipal
Bond
De¬
partment of Chemical Corn Ex¬

can

supply.

B.

become

-

Andrew

be

has

;

Dak.—Arthur

fices at 228 Ninth Street, West, to
engage
in a securities business.
Corp., 120 Broadway, New Mr. Vandall was
formerly with
York
City, in
their
municipal Investors Diversified
Services, Inc.
bond department. Mr. Kieper was
formerly with the New York of¬

reason

they

Kieper

f

atic

gradually become

is because

J.

N.

associated with New York Hanse¬

are buying
to get some fice of
waterfront, Georgia

waterfront. If you own

DICKINSON,

New York Hanseatic

of unknown wealth under

rivers,

this

Forms Dakota Income

Henry J. Kieper With

automobile; but the

will

13

IT

GO!

also

rI

/.

The Commercial and Financial Chronicle

14

..^Thursday, August 14, 1958

.

(610)

petitive

carloads of freight totaled 492,152, compared with
658,077
in the corresponding
period of the

from

ating

easing

12

Continued from page

somewhat their intolerable financial and com¬
position. The legislation which has resulted
the Smathers Committee recommendations is a

preceding

Industry's Outlook
DEBUTTS

A.

HARRY

Southern

marily
will

is needed

give

definitely been halted and that bet¬

off from 1957, but

public sentiment favors such a reappraisal. Edi¬
leading newspapers and magazines have called
for action. Members of Congress received an unprece¬
dented amount of mail favoring the Smathers Committee
recommendations. The climate of public opinion seems
to be right for making sense out of the nation's trans¬
portation, system, and it is to be hoped that our law--

end

makers

times

.

are

ahead.

normal.

in

Business

still

is

volume

before this year's
confidently expect a rising
trend in carloadings.
Our confidence is based upon the
same indicators that are being relied
we

nationally

upon

spending; people are
confidence; spending to

the first

For

in

time

fair chance to do

a

:

it

now

a

will

continue

the

has

that

work

good

Oettutts

A.

of the Transportation Act of 1958 (it
President Eisenhower as
this is written) the railroads have been given a greater
measure of freedom to compete for traffic in a business¬
like way. And they have been relieved of a number of
unfair handicaps that limited them in adapting railroad
service, particularly in the passenger field, to the re¬
still awaiting signature by

the

industries

become

can

be done.

a

that

them.

serve

reality, there is

are

the

-

The

higher

that future

Before

W.

ARTHUR

What does

one

could,

of

has

railroad

equipment.

mould cleaners.

in steel

consider

we

rate

hits

business has declined in sympathy with
production. We do not attain what

our

satisfactory results until the steel

80%

and

above

and

we

have

making

serious

doubts

thai

this rate will be reached this year.
However, we
would not be surprised if the Spring of 1959 sees us and
the whole country bowling along at a merry pace.
■

In

the

narrow
a

respect

meantime we are keeping in the black by a
margin and do expect to wind up the year with

of

and

markets

spect

all

to

American Steel

409,

American

Grotz

ful

competition,- with I
and

liket

with

even

lower

cers

and

men

Shoe

Company

Any discussion of the effect of the rail supply portion
of Brake Shoe's business on the
company's outlook must
be tempered by consideration of the fact that 62% of
its sales

are

to

non-railroad customers in

such

fields

as

And, finally,

we

demonstration

necessity
within

Such

be

thankful

earnings,

Brake Shoe depends on the perform¬
ance
of
the
entire
economy,
al¬

though rail supply is still the largest
single source of the company's sales.
38%

business

of sales

in

accounted

for

1957, and this ratio

has remained unchanged during the
first half of 1958. All of the com¬

pany's

product

lines

have

been

affected

by the recession, to ap¬
proximately the same extent.
The major portion of Brake Shoe's
railroad
Kempton Dunn

and

railroads

wheels,
limited

can

is

maintenance

which
The

business

defer

take

wear

the purchase

in

replacement
products,
parts
and
punishment.
of

these

items—

bearings, brake shoes and trackwork—for a
period. They have been doing this, and even

"cannibalizing"

some freight cars to keep others running.
eventually the roads reach a point at which they
order replacement and maintenance
material.
I
believe this point has been
reached, and I believe the

But

must

railroads will

soon

order

increased

quantities

of

these

products. Of course, Brake Shoe will benefit.

Fortunately,
point

at

a

the

time

railroads

when




reach

this

Congress has passed

attention

of

the

cars

eastern

section

of

the

country,

other

modes

spend"

legislation

more

there

than

the

been

will

economy

country's

90,000

were

.7

•

continue

transportation

needs.

M

to

expand, as
The railroads

does

not

contain

the

all

on

a

relief

necessary

sound economic

a

of

programs

modernization

should benefit

our

and

mechanization,

company.

J

The public has a better understanding of their problems now, and it is hoped that continued interest in

7

reversing the deteriorating trend in this important in?
dustry will result in an atmosphere that will permit the

-

was

railroads

to' better

portation.

compete

Felix S. Hales

with other forms of transr

"

Our diversification

have provided a degree of
stability that did not exist when the company was so.
dependent upon the volume of purchases by the rail^

-

moves

.

......

a

measure

carriers.

-

Today

about

60%

of

our

business

is

with

the

railroads, as compared with 90% about 10 years ago,
with no de-emphasis on railroad business but expansion
into

M

other fields.

^

;

The demand for precision roller chains and

undertake a broad
study of transportation
policies, with particular attention to the railroads.

1958, Nickel Plate

roads.

of

important step in the right direction. In recognition of
the need for further action, the Senate
passed a resolu¬
tion
authorizing its Interstate and Foreign Commerce

of

national

which in turn,

the Congress
equality of treatment and
opportunity that the railroads need, it does provide an

six months

year

the most,efficient carrier of many commodities and
will continue to- play a prominent role in our transporta¬
tion system. They must be able to compete with other

their

inequality long-existing in favor of private

the first

these has

later

necessary

only
building of a very large pro¬
indefnitely deferred because

one

the

totaled

be

needed
basis, but it
big step in the right direction. We believe this legis¬
lation will make it possible for the railroads to increase
their purchases of needed equipment and to continue

While the legislative program enacted
by
does not provide for all of the

In

undelivered

but

order and

of

operations will

They must have relief from the
restraining regulatory controls that have no regard fof
today's competitive and other conditions.
M
The legislation.that has recently been passed by Con¬

of

common

and

1957,

of

forms of transportation.

of

compared with

rate

by them to get back

competitive equality to the railroads, and the repeal of
the 3 per cent Federal Excise Tax on
freight charges
an

*

are

is

-

as

1,

on

gress

,

carriers

the

general economic conditions.

will

"

transportation
under existing laws, rules and
regulations,-' both federal and state. The
Transportation Act of 1958 will restore

removes

in

order

on

27,757

intensified for the railroads by their
inability to meet fairly competition
with

■

,

July

Our

Congress and the public generally.
The present
recession, which has
been particularly severe in the north-

and

during the last fiscal quarter and earnings will be lower
than in the quarter just ended. 7
'77
For the entire railroad industry the backlog of
freight

newspapers,

members

wages ;

compared with $28,000,000 at March 31, 1958. Further

as

shareholders, employees,
shippers, suppliers and other friends
of
the
industry were helpful in
bringing the plight of the railroads
the

in

constructive

the

Committee to

"must

.v¥v';.

,

reductions

Railroad

to

attributable to the

been better.

HALES

7

was

Backlog continued to drop, as ex¬
pected, and amounted to $22,000,000 at June 30, 1958,

-

bound to be helpful.

.;

reduc¬

equipment

of

fringe benefit costs.
,

support of the members of Congress
nation's

drastic

a

purchase

continued-V increases

Charles C. Jarchow

industry. Especially gratifying is the fact that these
measures received the
overwhelming
the

of

drop

decline in sales volume coupled with

road

as

result

the

ings decrease

Passage by the Congress of the Transportation Act of
1958 and repeal of the wartime 3
per cent tax on trans¬
portation of property have been heartening to the rail¬

well

in

was

substantial

"a

by the railroads and the general de¬
cline
in
manufacturing
activity
throughout the country. The earn¬

of

radio and television.

the

tion

portion

S.

approxi¬

down and
in the
quarter: The decrease in sales
was

was

perts in transportation

F.

were

in the first quar¬
1957 fiscal year; however

second ; quarter

third

con-

year

same as

of the

the

there

may

are

$3,910,of $76,055,976 in the

fiscal

1958

ter

re¬

on

as

the

mately the

Devotion to duty
never

for

i

of

in the same period last
Earnings in the first quarter of

year.

by this Congress of deep interest in the
improving
the competitive
atmosphere
the regulated railroad industry operates.

of

which

relief

can

on

income

$92,191,279

be granted in this session together
with the establishment of a Senate study
group of ex¬

as

machinery, construction and mining,
steel, automotive, and airborne de¬
fense
products.
The
outlook
for

Railroad

sales

^

alike, despite the layoffs which unhappily

have been necessitated by conditions.
and interest in better railroading has

■:

ended

with

Naturally, in the case of our particular com¬
pany, low operating costs and a sound financial structure
are
very reassuring.
From a broader standpoint, our
industry can indeed be thankful for the morale of offi-

JARCHOW

share,

per

months

sorts, with respect to

ideas in transportation

for,

increases.

good show of

June 30, 1958. This compares with
net income of $6,133,273, or $4.76 per
share, on sales of

.

DUNN

Brake

$3.03

or

nine

of

standardization

C.

had .net

tainerization, special device;car*s, etc.
But, there is so much tp
thank¬
Arthur

price
a

77," -.-V. ,%V ;7'"M

M

Foundries

respect to coordination, 7-1 could dis¬
cuss plans and blueprints which are
being prepared for future use and
new

heavy wage and
difficult to make

7'7 v'?7 .MM

'

D. B. Jenks

we

President, American SteeL Foundries

7

President, Nickel Plate Road

President,

more

CHARLES

^

rebuilding
and of completing the yard ex-,

studies

Of course,

with

and

more

pansion at Port Covington. I could
in a positive vein mention.; the in- '
creased emphasis upon research and

small profit.

KEMPTON

confronted

is

net

Western- Maryland

the

in

picture.

our

direction.

put has gone to the steel industry, to whom we furnish
custom made open hearth furnace burners and ingot

Naturally

compare

general levels of
the balance of the
much for the revenue

that I shall point my remarks in that

For the past fifteen years or so practically all our out¬

the decline

as

done

cars

'

President, The Crowe Engineering Company

!

currently

that

gross revenues

course, talk negatively about tightening
belts
and
deferring major capital

projects,

W.

DeSALVO

when his company's

say

study which Congress has authorized into these
areas requiring
legislative action is certain to
highlight some still-critical needs of our basic common
carrier, the American railroad network.

little

.

.

the

net income.

for the first six months of 1958 are off 22.35% and
income off 51.34% from a record
breaking/.1957?_,

The

exceedingly

.

been

has

in

So

of

are

GROTZ

It

I

than

carloadings

great deal of work to

a

President, Western Maryland Railway Company

further

sell

carloadings

side

answer

now

prosperous.

consequence

country.

But no one should consider the Act
legislatively to railroad needs. Much
remains to be done before the country can be assured
of a future in which railroads can be relied upon with¬
out question to
meet all peacetime and any possible
emergency wartime requirements for mass movements.

We

are

Island is

been

,

very good.Farm prices
satisfactory. The result is that
territory i served
by the Rock

crops

,

industry.

JOS.

;>

•

.

territory served by the Rock
Island, and the prospects .for, other

•

,

JENKS

the railroads' problems have been

quirements of users.
It is expected that the Transportation Act of 1958 will
do much toward reestablishing strength in the American
total

business.

The wheat crop has been good
"M

the

our

"

B.

the rest of the year.

in

and
Harry

With the passage

a

available

to
conditions
in the
territory served by j the
Island, I feel rather optimistic about our condition

Rock

seems

'

us

the

of

-

to
satisfy its share of these desires.
...
/
During the time of recession, Southern Railway has
continued to go ahead with improvements to its plant
and in its operating methods. No foreseeable call for
railroad service will find it unable to meet demands.

railroad

share

.

backlog of desires is beginning.
And the South is in position

was

.

favorably with 7 the carloadings of*
solved,'their
last year, although our receipts from
suppliers can continue to expect the fluctuations in sales
that characterize the business. It appears that an upswing
connecting railroads are consider¬
is due soon. If public, opinion and the force, of logic lead
ably below the levels of last year.
to a prompt solution "of our transportation problems, the V
However, the level of railroad re¬
ceipts from
connections Ms
much
upswing will lead to a promising future for the railroads

regaining
satisfy

an

Due

V

,

history,

recent

for

Until

indicating an end
Money is available

tor

each branch of the industry
part of the job it does best.

that

started.

as

the recession.

to

.

optimistic about the future
upturn in business in the

are

be

President, Chicago, Rock Island & Pacific Railroad Co.

torials in

yet be said that things are restored
to

needs

that

'

carloadings on the
Southern Railway System, it cannot
As reflected

will

D.

tion

ter

the Nickel Plate

on

believe there

fair

showing a reac¬
tion to the general rise in national confidence that the
economic slowdown of the past year and a half has

on

Business and

was

ahead.v Nickel Plate's house is in
order, both
physically and financially, and it expects to secure its

transportation on an equal footing. What
is an impartial reappraisal of the transporta¬
of the country, leading to legislation that will

the march again.

The South is

Oper¬

year.

income

months

with

long-range opportunity to compete

the

have

and

the railroads

stopgap, and does not insure that

a

industrial prospects are

-

net

other forms of

System

Railway

and

..

We

equipment in decent operating condition. It gives a
temporary boost to the railroads and their suppliers, '.7.-7
But the legislation does not go far enough. It is pri¬

and

President,

$66,724,000,

were

step in the right direction; it gives the roads some.relief,- .$3,157,000, or 77 cents per share compared with $1.72 for
the same period in 1957.
/
and it will make it possible for .them to keep their: plant
>
'
* • '

Railroad Leaders View
The

revenues

revenue

sprocket?
great as in 1957 and our backlog for springs,
forgings and machined products is not good; but there
seems
to
be
an
indication
of
improvement in these
areas.
The hydraulic machinery, boring mill and pipecoating product lines have maintained a fair backlog
is

not

and

steel

as

we

expect

wheel

this

business

business
for

the

to

improve steadily. The
industry is good

railroad

Continued

on

page

17

Volume 138

Number 5768

.

.

The Commercial and Financial Chronicle

.

awarded to the

Consolidated Natural

Fannie May's
Yeoman Service

(611)

tive

sale

Gas 43/8% Debentures

the

Sold at 101.142%

V v By HUGO STEINER

;

An underwriting group headed
jointly'by Morgan Stanley & Co.
and The First Boston
Corp. and

1//••'

composed of 69 investment

Specialist in FHA-VA mortgage
loans recapitulates Fannie May's
successful

c.

sale

is

offering for public sale today
(Aug. 14) a new issue of $45,000,-

ofc, mortgages

>

000 .Consolidated Natural Gas Go.

operating

companies engaged in
gas
business.
The
to

proposes

the net

in

principal

calculated

to

1963

amount,

retire

80%

of

$1,is

and
of

the

prior to maturity. The sink¬
ing fund redemption' prices range
issue

from 101% to the

during

the

principal amount

last

year.
Optional
prices
range
from
part of its 105.52% prior to Aug. 1, 1959, and
consolidated system construction decreasing annually to the prin¬
program for 1958 which calls for cipal amount on or after Aug. 1,
use

proceeds from the sale of the de¬

bentures to finance

redemption

a

a

1958' construction program will be

constitute

an

supplied

tural

system

debentures

yield
The

of

due

at

1983

4.30%

to

debentures

ma¬

were

expenditures

the

of

from

treasury

funds

of

system.

The

company's six

gas

subsidiaries

inter-connected

engaged

na¬

in

all

phases of the natural gas business.

June

when

5,

4,894

utilities

•

For

the

tal

months

12

30, 1958 the

company

operating

ended

revenues

and

income

deductions

gross

ing

revenues

and gross

were

income $34,430,000.

'

t

AGE

The ;

v

July 17 shows 1
Were

loans

paid for,
Hugo Steiner

.total

of $5,-*
305,000, pointa

pig ur

v:

v;,»> ;

greatly reduced activity

a

in Fannie May at the moment.
<

-

Stabilizing Influence

,

The cumulative number of loans

acquired

by Fannie May in its
secondary market operations, ac¬
cording
to
the
latest
release,

tqtaled 164,641.
dollars

The high point in

reached early

was

in 1958

when the money invested attained
a
peak figure of $1,860,974,000.:
This agency absorbed its greatest

volume

of

mortgages

of

quarter

1957.

in the first

that

At

time

33,845 loans, totaling $387,760,000,
were
presented
by
originators.
This highlighted the agency's sta¬

bilizing influence in the national
mortgage
market
over
an
ex¬
tended period when institutional
funds

less

were

ernment

receptive to

guaranteed

gov¬

mortgages.

Its

^activity,: during this period,
lent strong support to the build¬
ing industry* - at times being
only pocket book available

the
for
government underwritten; mort¬
gages :i:in certain : areas ; of S the
country." However, since the be¬
ginning of 1958, 23% of its huge
portfolio has moved into private
institutions. ;<'A
very
substantial
..portion^ of this high percentage,
in
turn, was absorbed' by" New

City3.av.ings-banks.

York

'^Fannie

May, in acquiring these
(FHA Insured
VA Guaranteed) in a period

first rilprtgage loans
and

tight; money and, conversely,
disposing of : them during a time

of

credit ease,

of

service

nian

has rendered yeothe
residential

to

segment' of -the,, building industry
and
adequately
performed- its

function

a

as

hassupplied

'balance wheel. It
liquidity and sta¬

bility in the United States mort¬

when other sources
inadequate. It
continues to provide an invaluable
gage

market

were

assist to the country's economy at
no

cost to the taxpayer.

•The

in

writer

recent

himself

going?

Where is this train

;

temporarily

-

;

What is it carrying? Chemicals,

To an atomic development laboratory.

and many of the
laboratory going. How does it get

metals, delicate instruments,

-

has

it takes to keep this important

'other things

placed
'

weeks

t

$5,000,000

Fannie May mortgages,

of

'J*

there? Qn the Santa Fe,, America's

originated

longest railroad. Now more

important than

in the Southwest and Far West.
r

ever

Yarnall, Biddle to

the

Admit Valentine
.

-

PHILADELPHIA, Pa.—Yarnall,

Biddle

&

members

Co.,
of

1528

the

Walnut

New

York

new

scientific

on

and

Sept. 1 will admit H.

Stuart

Valentine,

ship;

-

Jr.-to

partner¬

*




age, as

well

as

essential for

the basic things like steel,

needs every day.

machinery, and foodstuffs that America

St.,
•

..V.

-

Philadelphia-Baltimore Stock Ex¬
changes,

and finished materials

because it's moving raw

x.

.

:
•

"' " Let

'

|;

V

V'

.

f

us

'

*

' '

be

a

partner in handling your

SANTA FE SYSTEM

.

* " ? '

1 New York

'

Eastern

<

Freight Office

,

•

'

/

'

..

freight, too

LINES

'

233 Broadway, Phone Dlgby

9-1100

operat¬

$280,484,00$

$55,347,090,
changed !:

that 449

$296,before

$36,424,000.

For the 1957 calendar year

gages, totaling

latest weekly
release for

of

income
of

June

reported! to¬

mort¬

ha nd s'.

New

ginia.

NEW SCIENTIFIC

' •

in

York, Pennsylvania and West Vir¬

PARTNER IN AMERICA'S

,

recorded

was

non-affiliated

g|||gg|jg

vol-;';

week

u m e

principal cities served at re¬
are
Cleveland,
Akron
and
Youngstown.
They also servo
other cities in Ohio, Pennsylvania
and West Virginia.
Natural gas.
is
also supplied in wholesale to
tail

of

$426,979,000;":
The high

The

245,000

1982.

turity.

In 1958, as of the week ended
July 17, Fannie May has sold out
of its portfolio 36,590 mortgages
to private institutions and received

payment

owns

natural

company

beginning

800,000

...

terest—a

Agency's stabilizing influence
the national mortgage market.

in

the

provides for annual retire¬

ments

price of 101.142% and accrued in-*

this

'

••

-

sinking fund for the deben¬

tures

$65,000,000.
The
balance of funds required for the

from its portfolio and commends ; 4%%

;

firms

on

all of the outstanding stock of six

,

President, Hugo Steiner, Inc.,
City

13)

which named

'Consolidated Natural Gas

'

New York

(Aug.

interest rate..

A

at competi¬

group

yesterday

its bid of 100.1599%

15

16

The Commercial and Financial Chronicle

(612)

which is

even

doubled

THE MARKET... AND YOU
By WALLACE

lines;

stock

che

better than the

has

lower half of its

STREETE

Thursday, August 14, 1958

.,

prevalent
nevertheless

revenues

other

for

.

for the last

held

the

in

NSTA

trading range

more

Notes

than three

years.

Stocks

had

their

hardest

if

possible

rebound.

More

;

if

"

if

>'■'

.

im¬
The

depressed item in the
one-day correction in nearly portant for the stock market,
month this week, as meas¬ however, is the fact that the oils is Atlantic Refining, for
ured by the industrial aver¬ mutual
funds
are
on
their one. For the first half of the'
age, but all it served to illus¬ way toward compiling an un¬ year it was able to report a
trate was the accepted fact interrupted string of monthly profit less than a third of that
that between 510 and 520 in sales running $100 million or a year ago, a good part of the
the index is an area where better and this money still pinch resulting from the de¬
supplies of stocks are plenti¬ finds its way in important crease in allowable produc¬
ful and overhead sizable.
quantities to the stock market tion. But there are signs that
as the
generally cautious an upturn is possible and
Texas
allowable
production
Since the
senior
average managements concentrate on

NATIONAL SECURITY TRADERS ASSOCIATION
We

a

*>•

v

■

again

521

in

in July

was

year.
turned

without

succeeding
penetrating the line.

in

Depressed Issues
There

were

issues

pressed

around,

always considera b 1 e
discrepancy between
what the "average" shows and
what

the

nents

are

individual

compo¬

doing at the same
instance, while the
approach to the peak a year
ago was technically a failure,
time. For

nevertheless

Bethlehem

and

U. S.

starting to indicate
change in their for¬
tunes has arrived. Sulphur's
were one such
group, Texas
Gulf
Sulphur sliding to a
third of the price it posted in
1955 but lately hovering
around its best price this year.
The big competition here was
the growing
importance of
Mexican producers both do¬
mestically and in foreign

relief have led
many to
the conclusion that their
prof¬

more

Tempering
some

of

some

stock enthusiasm
that

if

was

the it

the fact

tabulations

"average" yield showed

a

of

dis¬

pinch

them

is

largely

in favor of high- yield on the cash
payment of
grade bonds which is sup¬ nearly 3%, in addition to
posed to be among the which the
company lards its
traditional danger
signs for declarations with stock pay¬
crepancy

ments,

possibility that the bond

valued for

kets

could

bottom

out

mar¬

and

draw away from stocks a bit
of speculative interest in a




dipping
history.
revenue

is

considered
a

under¬

line noted for not

into red ink in its
It has tripled its
picture in a decade

Convention

Sup¬

z/o

sup¬

TISCH, Chairman
Advertising
Com¬
v;

Fitzgerald

&

Company

40 Wall St., New York 5, N. Y.

Alfred F. Tisch

SECURITY TRADERS ASSOCIATION OF NEW YORK
The

Security Traders Association of New York will hold their
Sat¬
25, beginning at 7 p.m. Frank J. Orlando,
Good body & Co., is chairman of the arrangements committee.
annual cocktail party and dinner dance at the Hotel Pierre,

urday evening, Oct.

Motor shares
be

continued

to

big question mark, no
indications available yet of
a

how the

with

new

the

Rail Association Head

Favorably Views
Passage of Transportation Act of 1958

models will fare,

reports up to now

definitely bleak. A good bit of
discussion

centered

on

Gratified and heartened by recent Congressional passage of
Transportation Act of 1958, Mr. Loomis points out, neverthe¬
less, remaining major problems still to be successfully iresolved.

their

ability to rebound, but other

partisans looked to the heavy
duty truck lines to make the
better profit showing in the

as

those of the author

only.]

Daniel

ership of
tion

ment

staff

of

Carolina

Securities

Corp., Insurance Building.

Act

of

1958:

road
is

Nero

has become

Continental

connected

"Clearly,

industry

these are matters of
far-reaching
signifi¬
especially to railroads. For
and

great

gratified

cance,

and heartened

the

pass¬

entirely self-supporting, taxpaying railroads still must com¬
pete with forms of transportation
by highway, air and water whose

ing the Trans¬

costly fixed facilities continue to

the

by

final

action of Congress

in

portation

Act

be

provided, maintained and

of 1958 and

erated

the

op¬

funds

by
repeal of

by

Government

out

of

supplied largely by tax¬
payers. And compounding this in¬
excise tax of
justice, railroads still are forced
Damel P. Loomis
3% on freight
to contribute in taxes to help sup¬
charges. It
port these facilities, while being
is especially gratified that these denied the right to use them on
measures
received overwhelming an equal basis with their competi¬
support, not only in the Senate tors.
the

Federal

and

House

of

Representatives,

but also in the Nation's press and
on the air and
by the public gen¬

erally.
1958
to

Transportation

Act

of

makes positive contributions

sound

national

policy and

to

roads

some

from

tive

serious

relief

of

the

of

the

are

of their present

of

health.

rail¬

competi¬

which

cause

state

financial

transportation

the

handicaps

fundamental

those

public

solved

important problems
policy still to be re¬

physical
These

and

of

also

must

10%

on

be

railroads
at

last

$725

service by
year operated
million deficit;

and

inadequate and unrealistic
depreciation allowances for rail¬

road

plant and equipment.

"Until

the

problems

last

is

of

major
railroads

will

continue their efforts
of

as

rection.

step in the right di¬
same
time, how¬

a

At

the

ever, they
are
not—and should
not be regarded—as the solution
of all, or even the most serious,

the

problems confronting
common carriers.

tation

sound

policy and

transpor¬
fair and equal

Kirchner, Ormsbee Adds

our

(Special to The Financml Chronicle)

DENVER, Colo.
Kreidle

Further Action Needed

"The

need

for

recognized

in

adopted

303,

on

companion
Senate Reso¬

as

the

is

authorized

to

for

future

ac¬

important

problems of
transportation policy not yet re¬
solved. These subjects of inquiry
in

need

the

resolution

include

been

—

James D.

added

to

the

Kirchner,

Ormsbee

Inc.,

Seventeenth

818

&

■,

Three With Shaiman
(Special to Thr Financial Chronicle)

DENVER, Colo.—Mohn O. Carl¬
son,

Polito Martinez, Jr. and M. C.

Pressel

have

become

affiliated

with Shaiman and Company, Bos¬
ton

Building.

Joins Walston Staff

for

ditions; the

question

ment

assistance

forms

of

to

of
the

transportation,

desirability of
the

has

Street.

to

transportation ex¬
study and report, with

of

Wiesner,

Senate

three

on

staff

Interstate and For¬

recommendations

tion,

action

a

by which

Commerce

appoint

further

in be¬

national

opportunity for all forms of trans¬
portation."

essential

for

these

resolved,

half

perts

con¬

passenger

that

record

a

measures

dustry

is

added

welcomed by the railroad in¬

are

of

"To

of

tinuance of the Federal excise tax

"The

Govern¬
various

with

Securities Corp., 611
Broadway. He was former¬
ly with Thill Securities Corp.
North

additional
regulatory and
policy in regard to
the various forms of transporta¬
and

tion.

regulation of trans¬
portation under present-day con¬
A.

another;

by

matters of Federal

rail¬

"The

own¬

form of transporta¬

one

promotional

Transportation

the

(Special to The Financial Chronicle)

MILWAUKEE, Wis.—Alfred

passage

the

of

defined

Joins Continental Sees.

following state¬
by Con¬

regarding

gress

eign

RALEIGH, N. C. — Louis M.
Davis, Charles C. Elder, Jr. and
Joseph R. Latham, Jr. have joined

the

made

Committee

(Special to The Financial Chronicle)

Loomis, President of facilities; the subject of the

roads

measure

Three With Carolina

the

P.

the Association of American Rail¬

lution

behind

holding at a level of less than
eight-times-earnings, with a

the stock market. There is the

ALFRED

yield approaching 5%.

Eastern Airlines,

now.

Book

appreciative of this fine
port.
;■

produces showed

,

if

Inc., New

of
the
"Financial
Chronicle." We are all most

Harry L. Zeeman, Jr.

Steel, Chrysler and Gen¬
second half of this year re¬
eral Motors, Texas Co. and
markets. The answer for
Standard Oil of Jersey sold
gardless of how the Big Three
Texas Gulf was to meet the
fare. Construction work has
higher on the unsuccessful at¬
competition
pricewise,
i n - been
tempt than they had when the
picking up, which is al¬
crease
efficiency to cut costs
peak was posted.
ways an important prop for
and even, as Texas did, open
the heavy duty trucks, plus
Bclow-Pcak Laggards
up a Mexican sulphur deposit
the added boost if a general
of its own.
The chemicals, which were
upturn in the economy proves
*
'
;■,£>:
among the first major groups
valid.
The big problem still ahead
to start their
if
#
if
earnings slide,
were
far under their prices of Texas Gulf Sulphur is to
Mack
Trucks, which has
its
former
earning been
posted in early 1956 in last restore
making outstanding
year's bid for a new peak and power. The financial position
progress under a new man¬
are
still lagging. And cur¬ was maintained in part at the
agement, did show a halving
rently while a new bid for an expense of a halved dividend of
profit per share for the
all-time peak is considered in late last year. For the future,
first six months but the divi¬
the making only seven of the the company's capital outlays
dend was covered and projec¬
30 components in the indus¬ are due to drop from last
tions are for a better showing
trial average are above their year's record level and a large
in the final half. Its yield ap¬
highs of either last July or write-off of offshore leases
that affected last year's re¬ proaches 6%.
April 1956 and for a couple
*
if
*
the margin is a close one.
sults won't be a factor this
White Motor, the other im¬
*
c.
if
year. Any upturn in demand
for the mineral would lead to portant maker of heavy units,
As was the lease in
previous
hopes that the price trim to has been busily adding to its
changes in the margin re¬
meet competition last year, lines in recent years includ¬
quirement, the effects of last
first in nearly a score
of ing, earlier this year, Dia¬
week's boost from 50 to 70%
years, would be at least par¬ mond T. Motor Car, as well as
were
shrugged off rather
general engine work. Its divi¬
quickly. New highs were tially restored with all the
benefits that would add to the dend is covered by even con¬
posted both before the action
servative earnings projections
and again to start off this results for Texas Gulf.
for the year, as it was for the
week and the
Interest in the Airlines
pattern con¬
first hah, and has had a yield
tinued to be one of
ascending
There was considerable in¬ of slightly above 6 % at re¬
highs, 510 on the first surge
terest in the airlines which, cent market levels.
and 512 on the second.
This, so far in the
boom, are the
at least, held
[The views expressed in this
hopes high that
ones
noted
for
"profitless article do not necessarily at any
inroads can be made farther
time coincide with those of the
into the overhead resistance prosperity." But a recent rate
increase and possibilities of "ChronicleThey are presented
before the run is over.
<■

ifear

Doubts About the Motors

some

already

is

one.

Co.

plement

plenty of de¬

that the

There

ment

indicated dividend for Atlan¬

a

&

half page advertise¬
for
his
firm
for
our

mittee

for this

report

a

The

as

to

City, has again favored

National

well

as

Marks

with

increased for last month

was

tic at recent

of last

Each time the list

back

us

pleased

are

Harry L. Zeeman, Jr. of

York

.

April, 1956, issues of individual merit and
the area has been approached watch the actions of the aver¬
twice, once later in 1956 and ages more or less as an aside.
reached

that
Carl

use

of

a

and

the

system of charges

publicly

provided

(Special to The Financial Chronicle)
—
Lois L.
the staff of
Walston & Co., Inc., Mile High
Center. Mrs. Hughes was formerly
with
Walter
&
Company
and

DENVER, Colo.

Hughes

Amos

has

joined

Sudler &

Co.

Volume 188

Number 5768

Continued

from

The Commercial and Financial Chronicle

...

(613)

The

14

page

'

Raiboad Leaders
in

Industry's Outlook

both "the United

panding

our

Canada and

States and

facilities.

we

are

ex¬

;

Expenditures for property additions will exceed $12,000,000- in the fiscal year ending September 30, 1958.
The principal items are two new steel wheel plants
being built in the Kansas City area and in the Winni¬

area.""■'

peg

The/.company's financial position remains strong,
which is important in the presently depressed economy.
;We bglievethe: current business recession has now
„

"bottomed out" and expect our sales volume to be bet¬
ter in the quarter ending December
31, 1958, than in

.

the quarter ending September 30,

GEN.

E.

C.

With F. E. Siemens

Co.,

-

(Special to The Financial Chronicle)

Corp.,

all of New

York; Bank of Amer¬
ica-National Trust and Savings
dation of certain short term ex-,'
ternal obligations, the Kingdom Association, San Francisco; The
First National Bank of
Chicago,
of Belgium is arranging with a
Continental Illinois National Bank
group of American banks a three&
Trust
Co.
of
Chicago, The
year interim credit for $60,000,000.
Northern Trust Co., Chicago; The
Guaranty Trust / Company of
Philadelphia National Bank, The
New York and J. P. Morgan & Co.,
First - Pennsylvania * Banking
&
Incorporated, are managers of the Trust
Co., Philadelphia; Girard
credit, in which thn following in¬
Trust Corn Exchange Bank, Phila¬
stitutions are also participating:
delphia; -Provident Tradesmens
First
National
City Bank of
Bank & Trust Co., Philadelphia;
New York, The Chase Manhattan
Bank,
Manufacturers Trust Co., The National Shawmut Bank of
Chemical Corn Exchange Bank, Boston..;
'';
In

The

Hanover Bank,

Irving Trust
Belgian-American
Banking
Grace National Bank,
Brown Brothers Harriman &
Co.,

Belgium Arranges
$60,000,000 Credit
connection with the consoli¬

•

PORTLAND, Ore. — C. Bruce
Campbell, Charles Cumutt, WilP. Fuller, Glenn. H. Harris
and Frank V. Siemens have joined
lard

the staff of F. E. Siemens & As¬

sociates, 584 Pittock Block.
'

•;

,

..

.

•

Sept.

1

Car

a

partner in B.

W. Pizzini & Co., 25 Broad Street,
New

York

New

York Stock

City, members of the
Exchange.

Corporation

The general recession during the first half of the
year
did not have serious impact on the leased car industry
in

general

or

on

our

own

in particular. That

company

segment "of U. S. industry which comprises our steadiest

customers, while not prosperous, did
manage to pretty well hold its own.
As

result,

a

leasers
to maintain operations at
tory
level -during
the
car

.

able
satisfac-

were
a

first

six

months and from this built-in spring¬

-

-board

should

to

move

better

even

;

results in the closing months of 1958.
.1-' Economists generally are forecast¬

-

ing an upturn in business,; which
should
be felt:-throughout the car
leasing market. Movement of cattle

'

is

expected to increase substantially
and,
with
it,
the
movement
of

packing house products, which
sents

considerable

volume

repre¬

to

car

leasers.

Gen. E. C. R. Lasher

Likewise, the

„

for

long-range

outlook

leasing is, in my opinion, encouraging. With in¬
dustry expanding and introducing new products, there
car

will be

an

growing need for

ever

and better ways

new

of

protecting these products in shipment. Furthermore,
shippers generally have begun demanding increasingly
specialized service. This, I feel, points to a continuing,
healthy growth for car leasing, which has shown itself
consistently ready and able to tailor its services to the
shifting needs of industry.
W.

A.

JOHNSTON

*

President, Illinois Central Railroad

-

The

Illinois

Central

Railroad, although adversely af¬
most other industry by a low
volume of business and increases in costs, expects to
realize a net income for 1958 of about $14 million. It is
anticipated that gross revenues in

fected

in

with

common

will be

1958

approximately $24 mil¬

lion less than in
revenues

and

is

it

1957.

amounted

In 1957 gross

to

estimated

$290

that

total $266 million for 1958.

ization

of

the

for

strict

will

has

it

enforce.

will

The real¬

$14 million net income

a

year

economies

which

million

they

be
of

the

of

result

every

been

nature
to

necessary

•

Net income for the Illinois Central

in

the first

estimated

|

compared

seven

to
to

be

months of

1958

enues

Johnston

A.

in the net of only
mies
effected
in

charges.
The

during

is

about

$7%
corresponding period of 1957.
Wayne

this

Rev¬

period decreased

nearly $21 million and the decrease
$l1/2 million was the result of econo¬
operating and other expenses and

;

results

in

income

net

for

the

The

same

five

anticipated

but at

a

lesser rate of decline.

rigid economies will be continued in effect,

there

unless
-

is

volume and

should

be

revenues.

a

substantial

increase

in

Some immediate benefits

it is believed these benefits will

5

f <"

t

;.J(

,.k

Chances are,
we

you'll

never see

TV "show." But

put it on many times every day in our modern

yards where we use closed-circuit television to "pick"
numbers from inbound trains. Even though you

don't

see

it, this is

it helps to

a

"good show" for

you,

because

speed the movement of your freight.

traffic
are

ex¬

pected from the repeal of the freight transportation tax
and

>

car

remaining

months of the year are expected to hold about even with
the same period of last year.
Some further decrease in
revenues

WE WANT YOUR FREIGHT IN '58!

$6 million,
million in the

greatly expand in

time not

only to the railroads but to the entire economy.
of the unfair and burdensome passenger trans¬
portation tax of 10% is also urgently needed.

Repeal

We say,"We want your
that

freight in '58!"—but we know

just wanting isn't enough. So, we back up our

words

by trying harder than ever

—

using modem

legislation which has just been enacted when fully

equipment and the latest methods—to give you the

effective will be helpful, but much more is needed to
place the railroads in a truly competitive position from
which the public and the
economy of the country has

swift, economical and dependable service you want.

The

so

much to gain.
The

caps

railroads

still

This year,

ship via Southern and see!

experience the tremendous handi¬

of public subsidies to their competitors

as

well

as

those of unequal and oppressive
regulations.

'has; at last, become

very

much

aware

The public
of these situations

evidenced by the nationwide support given to
changes
regulations adversely affecting the railroads. We on
the Illinois Central believe that
public self-interest as

as

in

well

as

or r own

best interests lie in corrective




Continued

on

SOUTHERN RAILWAY SYSTEM
WASHINGTON, D. C.

measures

page

18

•

Russell. Hartranft.

Jr., will become

LASHER

R.

.

Will Admit to Finn
On

1958.

American

North

,

B. W. Pizzini & Co.

1

President,

17

THE SOUTHERN SERVES THE SOUTH

f

16

The Commercial and Financial Chronicle

chases of farm supplies,

It

ed.

Industry's Ootloek
and others that should be adopt¬

hoped that at some future

is

date the fixing of

oil, real estate rentals and timber, will show a healthy increase for the year, but will be partially offset by a

charges for use of public property for
commercial transportation purposes will be adopted.
Railroads need still greater freedom to price their serv¬
ices, and we hope Congress will see fit to take the fur¬
ther necessary action to bring this about.
adequate

user

Such

whether

enues

ularly

or
competitive

j-

will

net

1958

our

dian

equalled $4.25 per share, we should attain a very satis¬
factory earnings figure for the year.
PATRICK

Boston

President, The Atchison, Topeka and Santa Fe
Railway Company
«

,

revenues for the Santa Fe in the
first six months of 1958 were about 9% below the cor¬

Gross

operating

of last year largely

months

at

because

eastern

acute.

territory

Fe

Santa

throughout

good. As
conditions

are

favorable

of

On

taxes.

a

outlook

livestock

is

further

no

bright. In¬

ginning to notice

some

of

within

bright spots
the last
picture

control

the

of

legislation recently enacted by Congress, known
Transportation Act of 1958, should prove bene¬
ficial. It is the first recognition by Congress that the
railroad industry is not a monopoly and that it must have
equal opportunity to compete for business in a highly
competitive field. While this legislation falls short of
the full measure of relief required, it is a most en¬
couraging step in the right direction.

to do—we

the

President,
Close

s.

control

of

operating

Railway

So

ing

Specifically,

revenues.

in

crease

second

quarter

the

on

tenance of

the

of 1957.

income

As

written

the

If

the

correct in their
we

economists

predictions

should experience

a

on

around

4%

of

above the last half of

Since. Northern Pacific, is

tremely favorable
to

a

crop

a

to

our

on

our

products

should

rise

slump.

1957.

that

railroad, the ex¬
in NP territory points
traffic during the re¬

did

The

of

•'

••

interested

that

,

•

:

fill

was

left

suffered

a

we

their

This

needs.

I

pro¬

war

were
away

percent.
carried

ALCO

at

in

the 1 honor

with

1942

thd

depression

on

the

or

record

accordingly.

up 9% last year in
with the ball.

demonstrated

1955,
the

in

the

introduced

we

last
ern
<

ing

line

railroads,

and have
years. In

this many times over in recent

industry, and

all-new

of

we

a

completely
followed up

locomotives.

This

diesel engine to

new

later with

year

a

action

an

climaxed

was

spring when the company completed the most mod¬
locomotive-manufacturing plant in the world, cost?than $4,000,000, at our Schenectady plant.

more

We

.

are

that

sure

the

railroads

will'

continue

as

important factor in the lifeblood of the nation, and
standing by to meet their requirements.

robert

late

of

being

an

are

ton

1943.

Commissioner Eastman in
Yrcu

ginning

business

to

came

recession, and
sales

of

Office

at

indications

the
are

be¬

that

this

•

for

this

are

several

" l,
and

basic.

First, the railroad business,
and, therefore, our sales to the in¬
dustry, is tied closely to the general
economy.
With
carload
shipments
down, the railroads have locomotives
standing idle and will not consider
any expansion or replacement pro¬
until

there

is

a

definite

and

sustained

the

called

railroad

upturn. Second,
dieselization of the

industry
v
OCy

miles.

Gentlemen, I saw it happen
lost every intercity truck and

standstill

a

all

of the year.

a

the

?

Company

commodity will be
spotty, at the best, for the remainder

They

during

&

through the sale of diesel locomotives. This

our

of the

motives.

the

morse, jr.

The major dollar volume of our business in the rail¬

portion of

is

were up about two-tenths

in Washington

h.

President, Fairbanks, Morse

*# I* .

a-

.

is

xiifc some

50,000 steam

an

accomplished

18 years ago,

,

more

locomotives have

so-

fact,

than
been

replaced by about 30,000 diesel loco¬
exceptions, the railroads have com¬
program and our business will consist of

With

few

pleted this
replacing or the major overhauling of existing equipment.

more

Transportation.

and

because the

faith

have

not

Defense

of Defense
.

t

.

We

A A*

trucks, through October,

had

is

gram
are

Department is apparently operating on
theory that we arq going to have a'two-hour war;
that the hydrogen bomb will trigger the cobalt bomb.
Suppose we don't. Suppose we have another Korea.
Suppose we have another ground war./

:

,

principal manufacturers have man- aged
to
maintain ; full operations
William S. Morris^
through the Recession by their sue/
■
cess in competing with builders in all parts of the world
for fleet-locomotive orders.
''
V,
f {

Reasons

the

tially above a year ago. Cattle and sheep have been on
the increase for several years.
While this year's sugar beet tonnage will be 6% to
8%
below "1957, an increase of 20% to 25% in

.|

.

;

.

The

condition, with

feed plentiful and market prices for all
classes substan¬

;

cur-;

.

time, they will find a locomoindustry ^ completely ready to

tive

in

people than in. any year of
their history. They are in a little bit of a iump now, but
they carried more people^-The" airlines have problems,
but not because of lack of
business, at least up to this
point.- Ty

was an above average crop year.
Fruits and vegetables, fresh and
processed, will nearly
equal the heavy 1957 production despite a somewhat
lower estimate at present on apples.
—v .....
The livestock industry is in excellent

Farm' machinery sales have increased and Northwest
farmers and farm communities are enjoying a moderate

that

services

waterways
running

one

the

and rebuilt units. At"

new

road field is

declining situation,

The airlines

1957, which




ever

observations made that

The implication

are

The

potato

some

other

to

accrue

from

rebound

than he does in industrial bankruptcy.

the

but

sound"

the benefit of the domestic railroads

not.

They

always an important tonnage
railroad, will equal and probably exceed

duction is indicated.

parties is
;

the only ones in a

mainder- of the year.
The cereal grain crop,
factor

interested

none

more

level of ship¬

-

the,;,

U

operations can't help

fact-finding board,

we

I have heard

into

and

.

quarter, of 1959.

You cannot have

any

good backlog of orders for

a

We feel .that these basically,

did in the New Haven case, which I know all about. And
he is not goihg to pay attention to a lot of other
things

granger

outlook

substantial addition

year

credit.

business trends generally,

forest

states,

first

this

of

good domestic economy without good
railroads, and by good railroads I mean railroads with
A railroad in bankruptcy obviously holds down
labor and services. A Federal judge is not going to
pay
any attention to local commissions any more than he

Robert S. Macfarlane

are

moderate upturn in manufactures

movement

those

Presidential

a

ther increases in rates."
'

ington, Oregon, Idaho, Montana, North Dakota and Min¬
nesota—are even more encouraging.
With construction
generally and home building in particular on the in¬
our

before

are

of

because

are

go before the local commissions in the;
of those people—the Post Office, Agri¬
culture or Defense or the various shipper's associations—
are ever there to say, "Cut out those services.
We are a
friend of- the' railroads and we are going to oppose fur¬

48

and miscellaneous traffic in the fourth quarter. Prospects
for increased traffic originating in our territory—Wash¬

crease,

attempt to determine

■And when

Pacific

last half of

optimism.

1, I
prospects
the year justify

have

costs.

our

quarter

we

of

none

Aug.

on

stifled, and when the responsibility
is holding the bag, because
been
made by three'., government

management

shippers

our

when

1957.

is

we

mainder.

with both

Therefore,

our prices, we go be¬
Generally speak¬
opposed to it and so is the Post
Office Department, the Department of Defense, the De¬
partment of Agriculture and almost everyone else. Yet,

equal to $1.13 per share
with $1.48 for the first

this

are

morris

v

services and create the pricing.

our

decisions

ing

was

feel that Northern
for

second

comes

fore the ICC and present an argument.

In the first half of 1958, net

compared
half of

the

'

*
t

,

of

managers

down,

When

the period was equal to 86 cents per
share of stock compared with 75

in

Then the decision

■

rent. recession. With a resumption '
volume traffic, the railroads will
need to replace existing power and
expand their pools of locomotives

-

agencies.

$4,800,000" in
operating
expenses".
Largely as a result, net income for

earned

managers,'

v"..-,

managers we

the

operat¬

de¬

operating

revenues, down $3,500,000 compared
with the like period in 1957, was
more than offset by
a reduction of

cents

not

are

have the authority, subject to these
three bodies, and the responsibility. But those three bod¬
ies create our costs to the extent of 55 %, create the main¬
we as

comes

despite

They

;

.

ments will be maintained for the re-

when * they

deficit business, the passenger business.
That
enough. But, the cardinal violation o£ business
principles is that neither the ICC nor the fact-finding.
board nor the local commissions have any responsibility

as

position

control:

not

are

heaviest

expenses

relatively favorable

a

money

is bad

of

in

us

of costs, and by the local commissions in the case of our

in the second
■quarter enabled Northern Pacific to finish the first half
1958

offing.

that the company's present satisfactory

are

if ..we

us

by the ICC in the case of prices; and by the labor
board or the Presidential fact-finding board in the case.

Company

adverse effect of the lower level of business

the

export, ALCO finds its locomotive operations in excel¬
lent condition at this mid-year period: All indications

down

macfarlane

Northern Pacific

that cost
our

our

for the results.

robert

foirgive

And God

only recommend.

can

-

s.

"v Principally

throughout the United States. *
£'
We, as managers, have to price our product and our,
costs and our services not by what we managers want

The

as

is

.

God-awful;

They-are Within
48 different public service commissions
of

control

the

within

'

than did the first half.:

services

the

traffic pattern and have expectations that
1958 will present a more encouraging

our

balf

in

problem

the

.

Patrick B. McGinnis

overall economic activity. We are be¬

Ernest S. Marsh

in

decline

consider¬

indicate

Canada,

President, Alco Products, Incorporated 'i-;**u

the

in

where the.
average railroad, took 12 years to get
out of bankruptcy, ancj the MissouriPacific 24 years.
ItV only, came out
two years ago. But in-any event, the *-

tively good pace, and there appears
to be a general feeling that there
be

territory

railroads

get into Section 77,

ever

dustrial activity continues at a rela¬

will

seven

That is where this

and 1933.

bumper winter wheat crop has just
been harvested and the agricultural
and

those

spectre of bankruptcy is endangering
the whole industry as it did in 1932

a

Miller

G.

William

deficit, with all the freight busi-;
and all the passenger business.

a

ness

terials and

result

in

tries

able business in

Jersey, Lackawanna, and
Lehigh Valley, have Operated

the

higher expenses occasioned by in¬
creased
wage
rates, costs of ma¬

conditions

the other

on

tral of New

of

Basically,

There has ex¬

year.

ple, the steel and petroleum indus¬

of those railroads, the Pennsylvania, New York Central,
New Haven, Boston and Maine, Cen¬

responding period in 1957—a decline which reflected
the depressed conditions in the general economy of the
:V: country. Net income for the System
was
16% below that of the first six

levels

hand, current activities in, for exam¬

problems of the railroads, in my opinion
today, lies with the passenger-carrying commuting rail¬
roads in the East. That problem is acute because seven
acute

The

will

and

been,'

chinery and equipment;

Maine Railroad

&

V

slackening in industrial ma¬

a

McCINNIS*

B.

MARSH
President,

has

substantial

at

throughout the
isted

S.

miller

railways

continue,

transportation companies.
E.

Smathers

^

Our locomotive business for Cana-

which

1957,

match

not

before the
problems.

President, Montreal Locomotive Works, Limited

projects that will effect operating savings.

on

While'

,

:

improvement program, partic¬

its capital

accelerate

to

rail, truck, air

by

would result in truly

move

a

william g.

•

prospects of a slight upturn in operating rev- /
in the last half of the year, Northern Pacific plans <

With

any

service

transportation
water.

and

*

Extracts
from
Mr. McGinnis'
testimony
Sub-Committee hearings on railroad industry

decline

sharp drop in iron ore royalties, because of the
in steel production.
'

other form of transportation,
should be given the right to diversify or integrate their
services in order that they may provide a well rounded
The railroads,

But, the real forgotten veteran of

World War II is the railroad. Every other veteran that I
Basin, the fabulous irrigation project
in eastern Washington, 40% of which is served by NP; " know of is well taken care of, and should be. The real
casualty of World War II, the forgotten man, the for¬
is becoming an increasingly important traffic producer
gotten veteran of World War II, is the United States rail¬
as some 30,000
additional acres go into production an¬
road; forgotten by Defense, by Air, by Navy and the
nually and the newly established Basin farmers become
rest of them. But, give us another Korea and they will
better equipped to obtain maximum production.
be right at our door.
Northern Pacific's non-rail income, principally from

Columbia

The

Railroad Leaden View
The

needed carrying.

you

other consumer goods.

and

that have been enacted

tanker, but the railroads were there. We delivered
all the gasoline and all the goods and all the troops that
every

This augurs well for increased pur¬
home appliances and furnishings

degree of prosperity.

17

Continued from page

-

Thursday, August 14, 1958

.

•

•

•

.

.

(614)

The large scale sale of locomotives in the future will

depend to

great extent

a

with

mover

higher

on

the development of

thermal

a

prime

efficiency

and a broader
tolerance in fuel snecifications. Fairbanks-Morse has such

an

engine in development,

which will
of

use

work.

When
one

engine

of the necessary

sider

a

For

;been

and,

this

a super charged 2-cycle diesel
appreciably less fuel for the same amount
\\

& made available

it

will

provide

incentives for the railroads to
major replacement program.

more

con¬

than one-hundred years Fairbanks-Morse has

supplier to the railroad industry of track scales
more recently, a
supplier of electric motors and
a

>

Volume 188

Number 5768

:

k.

•

.

.

The Commercial and Financial Chronicle

.

"

'

'

.

/

■

' :

.

•

(615)

of; pumps for every purpose. This will continue to be 7
a good market for us.
:
>

J Another appreciable market which is opening
the

sale

power

cars/''"1"
)

of

the

Of

small

diesel

engines in the

7.

'

•

■

,

is v

By

horse¬

the

end

to

appear

120,000

than

10 to 30

H.

C. MURPHY

»

\

of

first half

the

this

refrigerated

be

the

for

the

:

greater portion of refrigerated rail traffic, the improved

this

mechanized refrigeration service already is evident and

7.7 7'
*;7 7
''.'7"
that - the , railroads, by c replacing
7 ■' /;' ■"!

appreciated. ;•

f This

means

loss

damage

claims,

and

increase

close

to

last

K

reach

President, New York Central System

The

*

public now realizes that without the basic, low cost
mass transportation of the railroads,
;

can

-

as we now

Bill

ers-Harris'

stride forward

,

policy. The Smathis

indeed

.

Uhe road

on

long

Alfred Perlman

•

;

77

transportation policy of the United States remains basi¬
cally obsolete and loaded with inequities. The railroads'
are still far from being on equal terms with other forms
of; transportation—either as to government regulation or
government assistance. " * >
7
;
;
a

strong common carrier transportation

is

industry

to

toward

contribute

as

on

the

a

true

.

7

than
move¬

in

all

while

the.

there

commodities:!

a

MilwaukeeRoad
of
only 7.4%
operating revenues
first 7 half of ■ 1958 as

railway
the

with

compared

1957, while the de-

creases

in other Districts and in the

United

States

as

whole'/were

a

follows for the five months:
District

Eastern

Southern District

Western

r

William

as

(incl.; Pocohontas Region)
(excl. Pocohontas Region)

District—-

J.

realistic regulation of

adjustments, and the revision of
requirements in the interests of efficiency.

19.8%
11.6%

9.4%

——:

States

14.4%

•.

behind

and

us

of the current recession seems to
leveling-off process now is under

a

Indications -point to a pick-up ahead—not sharp
Crop conditions in the area served by your
are
excellent.
Wheat is being harvested in
Washington and Northern Idaho earlier-^ than is usual
and the winter wheat crop in Montana has just started.
Harvesting is well along in South Dakota with better

but gradual.

than

,

;

..

,

crops of corn' and Soy
onions /and other vege¬
good. iSo, having the declining phase of

expected.

crops are

the. recession

Potatoes,

behind us, with products of agriculture
moving to primary markets in volume,* and with a grad¬
ual improvement in industrial activity in prospect/taking
up

;

has

yields.Bumper

average

beans 'are

table
J

,

some

-

of the slack encountered in the first half, we

hopeful that the full

are

off the

year

1957, insofar

1958 will not be too far
net income is concerned.

year
as

As evidence that The Milwaukee Road has faith in its
own

future

nation,

and

in

the

our company

which, cost

activity

$11,700,000

was

still

future

of

in

March

declining.

economy

1958,

These

addition to equipment purchases in
ment

the

;

.

Because of this recognition by Congress of the need
a strong common carrier system, the Central is re¬

while

purchases

improve¬
view
year's
budget. There are a few signs that we have reached the
pdint of upturn in the recession. However, we believe
that although the volume of freight traffic for the second
half of 1958 will continue to be substantially less than
that for the same period of 1957, it will be somewhat
this

examining

business

exempt commodities provision of the Interstate

Budget for the year, amounting to $6,800,000.

7

Continued

*

on

page

FAITH

.

IN THE

year's

$150,000,000

physical

FUTURE

it was forced to cancel, with a
tdward reinstating a large portion of it for next

better than for the first half of 1958.
jCars handled by the New York Central during the
"'first six months of 1958 were 22.2% under the corre-7

^ponding 1957 period. A decrease of approximately 16.4%
jsj anticipated for the last half of the year.
travel, the continuation of the

-7 In railroad passenger
downtrend is expected,

particularly as the result of the

continued impact of the
and

construction of new thruways

highways. Although mail

"io? increase

-

'

"

V

*

'

'

.

•'

.

N's
of $33.2 million,
and expenditure of additional millions for Central Traffic Control, and other ..
improvements. Looking beyond the temporary recession in our national economy,

The Dixie Line's faith in the
recent

continued growth of the South is shown by the L &

purchase of 3,543 new freight cars at a capital investment

L & N continues to keep

its facilities up-to-date, ready to handle every

transportation requirement.
Ask your nearest

L & N Representative about the modern

of

are

operation that

equipment and methods

continually put into use by the L & N to move your

faster, and more safely, than ever before.

•

;

freight;
'

,

*

volume is not expected

appreciably, revenues should show an in-;

granted
Commission. The trend in
express traffic is expected to level out, and if the rate
case which has been pending before the ICC for several
months is decided, this might result in an improvement

crease as a

result of the recent mail pay increases

by the Interstate Commerce

in revenues..

_

.

,

improved efficiency in railroad opera¬
tions/ resulting from our improvement program- of
1955-57, its better performance with much less rolling
stock, and its tight control over expenses should enable
Digitized to capitalize significantly on any increase in carit for FRASER
^

The Central's

http://fraser.stlouisfed.org/
loadings.
Federal Reserve Bank of St. Louis

LOUISVILLE

in

the regular Improve¬
In

by reason

substantial rate-making advantage

program

our

cars

were

for

ment

of

placed orders for 1,150 freight

fare, rate and service
railroad labor

Quinn

77

,

now.

petitive forms of transportation,

;.

during

more,.than

1957,

."railroad

an

that Congress has. acted on the prob- .
lems.of the transportation industry in so praiseworthy
a fashion, it is essential that similar attention
be given
to the problem by state legislatures and local communi¬
ties. Some of the most important areas in which such "
action might be taken are: tax equalization with com¬
Finally,

industry

and

;4:

way.
7

a

place the railroads

enjoys

expanding

.

,

railroad

'

•

The declining phase

equal basis with their com¬
petitors has been especially heartening. However, the
industry remains over-regulated, over-taxed and over¬
burdened
with
competition
from
other
modes
of
to

of

national economy..

entire

its

during

be
-

transportation that enjoy a subsidy. Additionally, and
very important, is the fact that our truck competitors

positive nature
.vigorous trans¬
an

,

of

decrease"

a

..United

.

result of legislation passed in the cur¬
• rent session of
Congress, particularly the elimination of
the 3% excise tax on freight. Public support for efforts
brightened

reaching reforms which will result from the broad study
into the health of the transportation industry and its
relations to the. nation's economy and defense which has

port

the

for

expenses,"

decrease

'

T956,;/Continue to attract a high level of

-The//outlook

an

will

The

patronage
between / Chicago,.' Denver
and
Colorado
Springs. The Slumbercoaches have proved exception¬
ally popular, recording an occupancy rate of more than
75% since their inauguration.
/
; "

system becomes more and more pressing in view of the
present critical situation in the Middle East. Therefore,
the nation is looking forward to the fundamental, far- 7

been ordered by the Senate. Much of a
remains to be done if a prosperous and

in

1.0%

was

suffered

•

and

duced late

1958

other than products of agriculture
of, 12.2% in the same periods. Con-

in.

since picked up during the summer travel
is-likely, to end the year only slightly lower
than in71957./ The- Vista-Dome Denver Zephyrs, intro¬

f7 Jt7must%^
however, that: even witb the
reforms embodied3'lir/the.^'legislation
just.?;passed, the

our

of

grain and other agricultural

sequently,

fPasseriger' traffic,: down 9% in the first five months

season

been

:

the Burlington
extra-large covered hoppers to

this year, has

such aX revision of our system of transport regulation.

^ The heed for

was

-

/

of specialized equipment,

.

^

toward

a

group/more

has

1

efforts, to improve its freight service the
Burlington has reduced westbound schedules from Chi¬
cago to
California points by one day to offer fifthmorning delivery, and has completed its new automatic
classification, yard at Cicero, 111., and an adjacent modern
freight house for more efficient handling of less-thancarload merchandise,"
7.7 7 ."7 77
7
7

;

This

period

same

,

;vInv other

to the critical need for such a
policy
and
steps/that it/has* taken to im¬

commodity

another.

'products
Harry C. Murphy

..

modern; transportation

hopeful that

are

months

is
fairly well diversified. Special conditions
however, which " may affect
••• •••7

ment of

likely to

freight;, car supply generally; has been ample to
requirements.' To satisfy the need for
types

we

six

large addition to

the first half of 1958 when the

purchased 100
malt and grain products, and 50 Airslide cars for 7*
bulk shipments of flour and sugar. Also,*400 more 40-foot
steeT'boxcars, .nearly all having damage-free loading :
devices, have been scheduled for acquisition early next /
year. These; 250 cars are in addition to 2,165 previously
ordered for 1958 delivery, including 1,500 boxcars on
which deliveries, were completed in July.
: 77 :
;

will not be satis¬
fied until the. whole job of giving
this country an up-to-date,7rational 7
transportation policy — on 7federal,'
state and local levels—is finished/// ,,
V Congress should be; congratulated
for the recognition it has given this

new

7

1957

June

in

know it. The. public

plement this

one

carry

exist, and certainly that if there
were
no
railroads, there would be
not

the

are

last

For the most part, the volume of traffic
on The Milwaukee Road follows along with the trend of the
general
business picture throughout the
country inasmuch as its

arise,

•

meet, shippers'
certain

present standard of living could

year

the

the

Pacific Railroad Company.;

traffic

-

Shipments of
7 v
f
-—lumber,
sand, stone and gravel—are running ahead of last year.
Traiier-ron-flatcar yolume is recording substantial gairi^.'

ALFRED E. PERLMAN

ho. United States industry

'77.'*,7

level. >;
construction materials

; This year, I believe that we have seen a rediscovery
of the essentiality of our railroad system—on the part
of both the public generally and by Congress. The Ameri-

our

/

year's

^purchase heavy carload traf¬

fic.; Livestock loadings
■

However,

in

WILLIAM J. QUINN

7: :

;

crop of
winter wheat is well under way, and

ed 'to

traffic

offset this

President, Chicago, Milwaukee, St..Paul

crops of corn, sugar beets., po¬
tatoes and soybeans also are . expect¬

7/7-7/V-fj

in

to

777;7

/

good

their

profit. We predict that this market will amount to from
50,000 to 60,000 cars in the next 15 years.

results

/ 777;'/.i 777 .
Harvesting of the bumper

/

their

present refrigerated rolling stock, can' attract new/cus- 7 I
tomers, /reduce

increase
tend

fall, the railroad could end 1958

with

figures.

,

union contracts.

year,
•

ing on the strength of the antici¬
pated upturn in the general economy

service available to shipper and consignee alike through

increase becomes effective Nov. 1 under the three-

pay
'

remainder

.

■

*

1

,

cars

ation. In the field of fresh produce, which is by far the

*

Another problem .is the continued rise in labor costs
-despite reductions in,the labor force. A 7-cent hourly

Chicago,

of 1958.
in the
Net "income for the second
United States only 3,500 are cooled mechanically. With
' quarter
was
more
than
$400,000
the rapid increase in the frozen food industry there is 7
h^her than in the comparable period
arv increasing demand for the constant low temperature
of 1957. Crop prospects in Burlington
which can be achieved only through mechanical refriger¬
territory are excellent, and depend¬
more

but slightly" amended by the

was

recent action of Congress.

\

year

reasonably favorable

Commerce Act which

?

President, Burlington Lines

Burlington & Quincy Railroad's business showed marked
mechanically refrigerated box
improvement/,over, the earlier months,; and prospects
7 7'.
7' ' :
777 ;;;'7VV/

lor use in

range
* '"•••'•-

up

19

1 '

..

&

NASHVILLE R.R.

20

20

The Commercial and Financial Chronicle

(616)

Continued from page

second- six months should not be much unlike
' ;; /*.
'
those who know the Bangor and Aroostook, it goes

see, our

19

the last half of 1957. •
To

without

.

*

The Ifidnstiy's

Outlook

doing this, substantial reductions in prices were realized
because the manufacturing plants had caught up with

Milwaukee

The

Road,

well

as

to

worst.

I

are many

will not be met by this
est
to

the

of

outlook for the railroad industry

as a

whole,
de¬

think it brighter than it has been for some years

spite currently depressed earnings.
I have in mind, of course, the recent enactment of
legislation designed to give the nation's railroads a more
equitable status in relation to their competitors.
While I believe it falls substantially short of what is

problems confronting the railroads which
legislation, the awakened inter¬
public generally in our problems will tend
aid in their solution. For this, we are grateful.

there

.

,

As to the

by the final action of Congress in passing
the Transportation Act of 1958 and by the repeal of the
Federal excise tax of 3% on freight charges.
While
is heartened

to maintain a sound transportation system in
this Country; it does at last recognize the fact that the
necessary

RICE

THOMAS

W.

industry is no longer a monopoly even though it has been
operating under monopoly regulation.
This is most encouraging. And, in my opinion, the

President, Atlantic Coast Line Railroad Company
Toward the end of the second quarter of

1958, a more
optimistic outlook prevailed in the railroad industry in
the Southeast that freight traffic and passe ger travel
would reach levels at least equal to comparative 1957
:V
'
levels.
Bearing on the matter, hovv,v>everv • is the., same v, indeterminate
K't

Senate's employment of a group of experts to study the
nation's entire transportation system is even more so.

As matters

stand, our transportation system oper¬
which was enacted piecemeal to
meet situations created by new forms of transportation
as they developed. As the Senate's Subcommittee on Surface
Transportation has itself said, "the efficacy ol
present iransporcation regulation 'is open to' substantial
ates

Kitb$tidit|\vhicih ^s.'present through-

out

•

.the

of

most

United

the

traificwise

ventions

in

effect

States, for
the inter¬

of

Lebanon

and

Jordan

no

assurance

that

a

quick

in the economy can be exalthough, aside from the
Lebanon and Jordan interventions,
upourge

to

accrue

in it

Included
tions
and

and

are

reference to systems of adequate user charges for gov¬

ernment-provided facilities; closer scrutiny of the need
and character of regulation and exemptions from reg¬
ulation; possible policy changes on mergers and consoli¬
dations, and determining methods of easing the burden
of

unnecessary

We

'

a

wide

Harris

legislation, will help us, in the coming months, to
up
these studies with concrete and effective

follow

action.

STUART

The Norfolk and Western expects its traffic and earn¬
ings in the seccnd half of 1958 to be better than for the
first half.

An upturn in business occurred in June, and

the prospects are that 1958 will be
-

'the

there
trend.

in

ment

signs indicating

are

June

noted

construction

residential

and

some

improve¬

demand

for

con¬

goods, and comparative levels of carloadings and
travel do not indicate the wide differences

sumer

passenger

which prevailed

during the first quarter and the greater

part of the second quarter.
Although during the first half of the year, Coast Line,
well

as

other

as

passenger and
in

Southeastern

freight losses, they

parts of the nation,

some

railroads,

ant

greatly reduced
Some

of

states we serve, and in our ability to
improve and expand our services to
keep pace.
-

experienced

were not as severe as

Evidence

Unusual weather conditions

freight

the

of

this

sites

The

trial

standpoint, although here again the
international situation may rapidly change the picture.
If the slightly increased sales trend
recently evidenced
by a number of national firms is sustained, it is con¬
fidently expected that deferred and scaled down capital
expenditure programs involving new industrial develop¬
ments

in the

area

served

by Coast Line will be reacti¬

industrial

has

growth

Southern

Pacific

has

built

Transporta¬
or

new

attention

has

been

acquired
a

cost of
Particu¬

paid

to

are

also

"

continuing

investments

our

as

As to

our

Centralized

in

such

im¬

midyear finds the

we

-

of

most

of

our

sister

in

roads

month has witnessed

and there has been

no

maintenance or curtail
capital expenditures.
any

We

do

not

usual talent
nor

should

that the

in

this

to

case

un¬

in

our case

the second declined

While
paper

we

do

not

W.

G.

Robertson

materially in the first six months.
expect

great

improvement

This

cents per
The

represents

fewer

than

was

general, business

decline

would

have

year.

caused

a

greater drop in earnings, however, if Southern Pacific's
(large capital investment programs in recent years had

gradual

upturn

our

in general business levels

August of last year.
Thus it is possible to say that insofar as

we

can

now

in

than

1958

in

the

it was

in the first,
coal consump¬

1957.

industry will
Moreover, it

likely that the steel industry will operate at a
higher rate of production the last six months of this

With the heavy inroads which have already been
coal stockpiles, coal purchases of the steel in¬
should be considerably greater during the last
half of this year than they were in the first half.
year.

made in

dustry

Norfolk and Western
erated

the

'

is also

hopeful that, with accel¬
spending, particularly for the de¬
highway programs, with depleted inventories,
of new automobile models, and the Govern¬

Government

spur

ment's

easier money

provement

in

increase in

our

Increased

policy,

will

we

general

our

im¬
resulting

see a gradual

and

economy

a

merchandise traffic.

efficiency and

the effect of lower
Western is continuing its
gree

plant

economy

of

operation

trans¬

have

that

problems.

it is

a

cure-all

Similarly,

of the 3% excise tax

Norfolk

de¬

ancl

tinue at the rate of 16 per month. This
acquisition will
enable the company completely to dieselize its

tions at present traffic levels and to increase further its

operating efficiency.
JOHN

Preliminary
not been

W.

as

to

legislation will not be felt
would be

for

a

indications

affected

degree

as

proves

SMITH

true

other

some

are

mistake to be¬

the

freight transportation should not
be overemphasized because of the
spotlight of national
publicity.
Carriers have merely been collecting that

that

the

Southeast

by the current recession in
sections

as

has

severe

the

of

country. If this
final figures are in, we shall have
repetition of the condi¬
tions existing in the 1954 recession
when

witnessed

a

when

Southeast

the

appears

railroads' regulatory
the value to the carriers of repeal

on

levels.

some

a cost of about $50 million.
Delivery
locomotives will begin in October and will con¬

of these

of that

given to the railroad industry's campaign to
place our
transportation laws on a fair and equal basis.
The
Smathers-Harris transportation legislation re¬
cently passed by Congress takes some definite steps in
the right
direction, and its provisions should help the
railroads—in fact, all common
carriers—compete more
fairly for business.

lieve

traffic

offset to

program
for improving its
equipment.
The company's Board recently
the acquisition
of 268 new diesel-electrie

and

authorized

was

better

to withstand the economic

specific predictions

no

immediately, however, and it

year goes on. The reason is the start of this decline in

<•

in

seems

in

$25,803,136, or $2.85
of $1,356,548, oi¬

share, from the first half results last

and pulpwood during the remainder of the year,




9.9%

decrease

a

Some of the effects of this

the comparative rate of decline should
grow less as the

;

less

President, Seaboard Air Line Railroad Company

in

any

were

Our long-term outlook has been bolstered so far in
1958, however, by the strong and vocal public support

than

of many railroads.

Traditionally,
one-third
of
our
freight revenue comes from carrying
potatoes, one-third from paper and
pulpwood and one-third from all
other categories. Of the three, only

1958

established we can make
how the year will end.

operating a railroad
It just so happens

severe

keep

to be the outlook for the remainder of this
year, accord¬
on
which we base our forecasts.
Just how gradual that upturn will
be, of, course, is the
unanswered question, and until, the trends are better

normal

is that

domestic
electric power

the

coal

more

the de-

coal wall be about

brighter for

are

Undoubtedly,

consume

period than

were

able

buffetings

some

other

areas.

.This

ing to the indicators

impact of declining business

has been less
in the

attribute

we.

deficit

a

ls

A

need to defer

un¬

year,

opera¬

not created greater
diversity and efficiency of
portation operations.

the

East.
No

share.

per

running 27% behind
this is no cause for celebration. On the other
have the good fortune to find ourselves in a
much more happy situation than that

tainly
hand,

prospects

tion.

period of 1957.

Net income for the first half

Railroad Company

of the Bangor and
that of last year. Cer¬

to

has naturally been reflected in our traffic and
earnings.
Freight carloads handled by the Southern Pacific System
the similar

net income

Aroostook

Traffic ; Control,

present business, the national economic decline

during the first half of

The

last

locomotive units at

We

operating efficiency.

^President, Bangor and Aroostook

the

cific and Union Pacific.

boosting

GORDON ROBERTSON

of

somewhat

or

enabled the Norfolk and Western to

provements,

W.

same

second half than

a

Russell

J.

ment is

clusion within the last half of the
year.

the

Stuart T. Saunders

outlook

for export

variety of cars built for specialized
freight hauling. This total includes
the first 500 mechanical refrigerator
cars
of a 1,000-car, $21 million order, being built for
Pacific Fruit Express, jointly owned by Southern Pa¬
L>unaid

vated before

the end of the year. A marked
improve¬
already in evidence at this time in the number
of active industrial projects which have reached the
survey stage and are expected to be progressed to con¬

period

principally because domestic consu¬
mers delayed placing new orders and
relied, when possible, on existing
stockpiles. Foreign purchasers like¬
wise pared their orders.

fense and

freight cars, at
about $35 million, in 1958.
lar

development

future

System

2,849

Florida's smallest in six years.

note of optimism is present from an indus¬

for

tion

carried over into the next citrus season,
for it is estimated that the coming citrus
crop may be
same

confidence

our

along SP lines.

and passenger
weather are ex¬

pected to be

,The

of

been a heavy 1958 program of add¬
ing to and upgrading our freight car
fleet, as w£ll as one to protect choice

movements

results

continued

than

traffic

'coal

same

the

mand

growth and diversified development has not been altered
by 1958's national business downturn.' We still have the
deepest confidence in the continued expansion of the
eight
western
and
southwestern

in Florida had much to do with these losses, and prob¬
ably to as great an extent as conditions generally.
Ex¬
tremely cold weather and excessive rainfall considerably
damaged Florida citrus and vegetable crops, with result¬
travel.

for

N&W's

current

more

30.9% in the first half

While the

outlook

even

der

RUSSELL

long-term

of.' the

effects

perhaps

declined

President, Southern Pacific Company
Pacific's

the

business.

most

for additional needed legislation in the days to come.

Southern

felt

recession

be thus kept before Congress for pos¬

J.

which provides
mainstay of the N&W*s traffic,

has

policies which the railroads have long sought
were not
included in this latest legislation.

D.

for
record

year

the

The coal industry,

sible luture consideration is, to me, a good reason to hope

a recovery

although

the

peeled,

W. Thomas Rice

fairly good

a

company,

levels set in 1957 will not be reached.

of the modifications in regula¬

many

SAUNDERS

T.

President, Norfolk & Western Railway Co.

for study.

area

services.

passenger

hopeful that the great public interest in the
changing needs of our transportation systems, as shown
in the past few months as a result of the Smathersare

which

That they should
-

„

this, in passing Senate Resolution 303, which carls for
detailed investigations into other sections of transpor¬
tation laws which require new legislation. Specifically,
the resolution outlines, for study, such, important sub¬
jects as removal of restrictions which keep transporta- ■+
tion companies from diversifying into other forms of
transportation; establishing a uniform Federal policy on

now

legislation

The Subcommittee has outlined

States, is certain.
There is

the government;

direct benefits from its repeal
freight shippers and their customers.
Helpful as all this 1958 legislation may become, it is
just a start. .The United States Senate has recognized
will

doubt."

cannot be evaluated pending devel¬
opments in the situation.
That such
developments could have a profound
effect
upon
the economy
of the
Southeast,
as
well as the United

-

under

Thursday, August 14, 1958

.

government assistance to transportation, with particular

this assumption—we feel free
say that 1958, while far from the best year in the
history of the Company,1 will certainly be well above the
short—and granted

In

all other railroads,

as

1

casts.

upturn in our carloadings.
Two hundred
seven box cars have been delivered already and are or
soon will be in service.
fall

usual

only assume past averages in our own tonnage fore¬

can

equipment will be available for the

their orders, and the

saying that~this :is predicated on an averagepotato movement in; the Fall. Right now the outlook for
the potato crop is excellent. However, it does not necessarily follow that a high yield crop of first class quality
means Fall loadings comparable with recent years. Load¬
ings depend almost wholly on the market.
Since we have no way of forecasting the market, we

tax for

.

.

those

resiliency
of

dynamic
in

the

no

have

growth

that

Southeast

two decades.

opment

is

who

us

surprise
watched

has

during

to
the

.

occurred

the

last

The widespread devel¬

of

industry throughout the
coupled with advances in its
agricultural - activities, has greatly
area,

broadened the economic base of this

region.
1

As

eral

:

was

to

be

downturn

expected,

in

business

the
had

-

gen-

,

: John w. Smith

the

effect

of. slowing somewhat the expansion of industrial
productive facilities and, as a consequence, some projects
which

ferred.

were

scheduled for the Southeast have been de¬

This deferment,

however, is expected, to be only
temporary and when the economic weather torn s more

favorable

there is sound reason to believe
postponed projects will be reactivated."

that

these

My" optimism for the future of the Southeast stems
only from the gains already made in this section, but
also from the underlying factors which have been
so
not

;

Number 5768

Volume 188

:

..

The Commercial and Financial Chronicle

.

important in bringing this area to the forefront of the
nation's economy.
The combination of an ample and

(617)

Exchange
Operations Course

willing- labor force, excellent transportation, abundant
water supply, varied
raw materials and a
favorable
business climate will continue in the future, as in the

-

past, to make the Southeast an exceptionally attractive
area for the establishment of new industrial and com¬
mercial

is that of

personal income.
Continuing a trend of some years'
standing, personal income in the Southeast is rising at
faster rate

.

than

the nation

for

as

whole.

a

This

in-

creased purchasing power, along with a growing popula¬

tion, further enhances the region's standing
and serves

as a

ments, he must serve an appren¬
ticeship of six months before he is
authorized
to the

At Northwestern

to

his firm

represent

investment public.

The

12-week

at

course

western will be sponsored by Ex¬
special course in "Stock Ex¬
change Member Firms and ad¬
Operations" will be in¬
ministered by the Central States
augurated in Chicago this Fall by
the School of Business of North¬ Group, Investment Bankers Asso¬

as a

market

stimulant to business generally.

Although the end of the recession cannot be predicted
certainty, I am confident that once the overall
economy begins an upward turn, the Southeast will move
forward again on a broad front to register new gains in
all phases of its economy. As an integral part of the
with

Southeast, the Seaboard will share in that growth and
our plans are being shaped to that end.
H.

E.

change

western

it

has

been

announced by

the New York Stock
and
the
Investment

Exchange

Bankers Association of America.
The

Exchange

develop

similar
tp

is

planning to
at other

courses

universities

meet educational

A

ciation.

By successfully complet¬
ing the course and another called
"Investment Bankirig," which has
been offered by Northwestern and
IBA

for

a

applicant
registered

number

of

years,

an

for
the
position
of
representative will be

help applicants
permited to waive the customary
requirements to

become registered representatives.

written

examination

in

course

"Stock

Exchange

Thursdays from 3 to 5 p.m..
Loop location not yet selected.
Developed by Professor Harold
W. Torgerson, the course will be
taught- by Professor Loring C;

in

a

Farwell.
ment

The

in

course

Banking"

Professor Bion

is
B.

Arrangements

"Invest¬

conducted

by

Howard.

the

under

are

supervision of the Education Com¬
mittee of the Central States

Investment

Chairman

Bankers
of

the

Group,

Association.

committee

is

required by Robert
Mason, Chicago underwrit¬

the Exchange.

ing representative of Merrill
an
In New York, similar studies —
Member Firm of both classrom and correspondence Lynch, Pierce, Fenner & Smith,

registered representative is

employee of
the

SIMPSON

University,

The

Operations" will begin on Oct. 30
and
extend
through • Jan.
15*
Classes will be held on Tuesdays
and

North¬

A

enterprises.

Another bright spot in the regional picture

a

sides meeting educational require¬

Stock

21

New

who

a

York

serve

President, The Baltimore & Ohio Railroad Co.

Stock

Exchange

public customers.

Be¬

offered

—are

by

the New York Board of Trade Building, Chicago
"
4, Illinois. %' '

Institute of Finance.

Considering the disturbances now
existing in the traffic situation of the

\V

it

railroads,
realistic

is

believed

outlook

of

the

the

most

Baltimore

and Ohio for the year 1958 would be
that furnished the Interstate Com¬
merce

Commission in Ex

which

was

Parte

212,
■

Our

about

earnings

gross

six

months

our

net

the

$187,378,295,
period

were

income

for

-

■#V

and

-EV'f'

was

Challenging

$6,371,617.
The

forecasted

earnings for
$413,000,000, with
$16,000,000.

gross

year

net

We
ML E. Slapioa
j

favorable

I'.;''

JAMES

are

sure

are

'difficulties

;

the New

income of roundly

1958

of

V

Space Age

appreciate the
providing any more
you

comment

M.

a

first

for that

the

I»isi ii
.

follows:

as

at this time.

SYMES

President, The Pennsylvania Railroad Company '
inevitable

that a sharp recession in business
near-disaster to a railroad industry finan¬
cially undernourished by years of stifling restrictions.
That is just what has happened in the first half of 1958.
It
now
appears
that the shocking
facts may have helped bring about -.i
a change in attitude that may prove
a long-term gain.
,::T
On the Pennsylvania,' freight vol-:
It

was

would bring

Faith in

On July 2,

first six months of the

ume

for the

year

fell 22% below the same period

of

1957.

This

drastic

reduction

ji

up

deficit

a

of

Improved models of the rocket-propelled XKDT target

of the

the

a

legislation indicates an awareness
condition of the railroad industry

danger to the whole economy and

tional defense.

to na¬

This recognition and understanding can

favorable factor

indeed, especially if it leads to
practical plan of government financing
for new equipment, to public support for commutation
services, and to more equitable state and local taxation
of railroad properties. ;
'
Repeal of the 3% excise tax on freight transportation
should prevent further erosion of the railroads' freight
business by removing the artificial advantage of using
such results*

as a

„,

V:

a

series of trial flights

planes have been delivered to the Naval Air Train¬

ing Command at Pensacola, Florida. Temco's

.

to operate. The new
that the deteriorating

'

"Pinto," the Navy's TT-1 primary jet

successfully completed

at the Patuxent River Naval Air Test Center and several

program

increases have been received in the IRAN and modification

Greenville. Work

programs at

on

the aft fuselage of the

McDonnell F-101 Voodoo and wings for Lockheed's F-104

Starfighter continue to
But

even

more

progress.

significantly, Temco's combined research

and development programs of engineering and

ing have produced
cation of

maufactur-

techniques and skills in the fabri¬

new

heat-resisting materials in the Mach 3 family of

aircraft and missiles. Temco's newly

developed methods

and capabilities in the brazing of stainless steel honey¬
comb sections

Write for your
copy

in double curvatui'e

are'capturing the

interest of the industry.

of Temco's

''

P

Report. Also
available,

The vitality of Temco's growth

«.

on

request..

experience and facilities.. is making Temco
-

Temco's 1957

an>

integral

,

-

part of the

new spade age.

• -

:

Annual Report.
Write

■' |

Department

Six Months Endsd June 30

CF-2

Temco Mid-Year

1957

1958

Highlights

Net Sates and Other Income

*

61,519,718

♦

61,640,181

tse.l 4-6,208

♦

66,611,091

Deduct:

Research and development costs

1,732,383

1,690,986

session of Congress.

Provision for Federal taxes

1,264-,100

1,133,508

832,924

725,471

367,666

461,367

in June, 1956.
Cost-of-living adjustments and increases granted un¬
der the labor contract signed two years ago will add
about $26,000,000 to our wage costs on an annual basis.
In addition, maintenance should be increased.
If there
should be a rapid increase in traffic volume caused by
economic or defense needs, this country would experi¬
ence
the greatest
freight car shortage that has yet

on

Income

General and administrative expenses

Interest

•

,

TOTAL

•

...

♦60,34-2,280 *60,622,423

NET INCOME

for

,

.

%

•




Continued

on page

22

^

its depth of capabilities,

..

Cost of sales

mail, scheduled to go in effect Sept. 1, and retroactive
mail pay for the period since the increase was applied

,

1958 Six Month's

private trucks to avoid the tax. Removal of the 10%
tax on passenger fares should be effected at the next
More immediately helpful to the Pennsylvania will be
the 30% increase in payments for handling the U. S.

for

the Air Force in electronic modification continues and

important legislation in many years economically
helpful to the railroads—will assist in the long pull. Its
various provisions, however, do not automatically give
the railroads anything tangible; they simply provide a
fairer set of ground rules and a better climate in which

.

under consideration by the Navy, Army and Air

trainer has

first

i

are

Force. Temco's

Pennsylvania will end the year in the red for the second
time in its 112-year history.
While the rate of business activity is the key factor,
there are others.
The Transportation Act of 1958—the

a

faith in Temco represents their faith in the future.. for

drone

light of these hard facts, it would be foolish
to attempt to forecast results for the last six months
other than to say they will depend on the timing and
extent of a business upturn.
It is probable that the

be

1958, Temco paid its 38th consecutive cash

quarterly dividend to its stockholders. Our stockholders'

approximately 124 million dollars.

situation, our company has reduced
Junes M. Symes
employment, deferred maintenance,
and made all possible economies to
achieve a reduction in operating expenses of more than

constitutes

-

intent and contracts under negotiation amounting to

more

$25,000,000 for the first half,
compared with net earnings of more
than $12,000,000 in the correspond¬
ing period of last year.
To meet the

In

li*

>

Temco is pioneering in the design, tooling and production
for tomorrow's spacecraft industry. Temco has letters of

than

14%.

mm
*

in

business, together with inflationary
increases in costs—particularly wage

costs—piled

Tembo Means Faith in the Future

P. 0. Box

6191

•

Dallas

%

1,17-7,438

22,

*

Texas

1,017,758

The Commercial and Financial Chronicle
22

program

21

Continued from paye

marketing

Railroad Leaders View

Industry's Outlook

It could

very

existed.

well be the roadblock to

The

These

ominous

are

tee
that

On the

the picture.

aspects of

Thursday, August 14* 1958

.

.

provement in business will restore

CHARLES
Chairman,

.

Not

that

the balance.

WHITE

M.

Republic Steel

recent trough and is on its way to considerably im¬
proved levels of operation in the latter part of 1958,
but we also have sound reasons for
than

more

railroads

being maintained at reasonable
levels. Now we are nearing the end

inventory liquida¬
factors which
promise continued good steel opera¬
tions are (1) this shift in inventory
policy could result in as much as a
million tons per month increase in
cteel shipments simply because in¬
ventories are not being liquidated.
wmte
(2) The declines in some of the steel
consuming industries appear to have
,
been arrested, one of them being the very important
construction business which is. showing new signs of
Strength.
(3) The seasonal pattern of the automotive
industry should prove to be very stimulating in the
fourth quarter.
In addition, it is anticipated that 1959
will see a higher level of automotive production than
of that period of

ward trend which has been evident for

favorable factor during 1959.

a

time in the

some

On this basis

we

as

much

In spite of this improvement in the
we

as

prove

a

industry's position

exerting constant

are

company

effort

railroads

in

1947

workers in

im¬

to

climaxed

lation,

two

weeks

ago

by passage of the "Transportation
Act of 1958," forms one of the out¬
standing achievements of the 85th

Congress, according to the Associ¬
ation of American Railroads. The
significance

to

|>ublic,

Association

lies

as

the

much in

carriers

and

the

reports,

Congress' prepara¬

tions for future action

as

in that

already taken.
The

railroad

^responding
■trouble
in

states that,

group

to

clear

and

Specially among the nation's rail¬
roads, Congressional leaders have
topped off seven months of grind¬
ing work with this three-part
legislative package:
Three-Part Legislation

'

"(1) Repeal of the wartime 3%
freight excise tax, saving shippers
half-billion dollars annually and

wiping out

a

major

inducement

for businesses to turn from
using
for-hire carriers to
their

own

fleets.

financial

dis¬

starting public policies

toward

for all forms of

and

House

after

lengthy hearings and conference
work, providing some immediate




the

other

treatment

equal

'

side.

"(3)

transportation.

Adoptiori of Senate Reso¬
303, setting up a compre¬
study of transportation

lution

hensive

problems

and

contemplating

recommendations during the next

from

public

the

the

in

interest

moves

first

was

which

and

of

these

obvious

announcement

of

hearings
on
the
subject.
transportation service by

before

relieved

the

have just completed the best second quarter in
31-year history and look forward to a continuing
high level of sales for the balance of the year..
.
j

of

.

railways.

pioneer maker of mechanized railroad track main¬

A

■

tenance

equipment, we now have 11 types of machines
production, with additional units under development.

in

Ait hough

most

subcommittees

due

,

We expect this factor will keep results at a good level

.

at

lea?t

through this

becoming
be

use

of

more

These

machinery.

factors

are

on

work

interstate

com¬

'

;v

the Interstate Commerce Act. ;

Limits

the scope and

clause

by

sas.

"Testimony developed in hear

policy

to

yet

be

re-

V/-•'"'>?■/

ap¬

Senate Resolution 303

com¬

under

which

motor

vehicle

certain

commodities is exempt
economic regulation under

"The
out

resolution,

that

a

'sound

which
national

points

trans-y

portation system is essential to the
continued

economic

development

policies

Summary of Transportation Act

(1) Directs the Interstate Com¬

vices of
burden

heavily losing trains that
interstate

commerce.

authority to the
I.C.C. to guarantee private loans
greater freedom in making rates to railroads up to a ceiling of $500
to meet their competition.
This million for capital improvements,
provision stipulates that the I.C.C., equipment purchases and mainte¬
in deciding whether a rate is lower nance purposes.
Commission to permit the
various modes of transportation

merce

than

a

reasonable

the

the

minimum, ^hall

facts

attending

and

the

circum¬

movement

traffic

by the carrier
carriers to which the rate is

Arkan¬

portation
solved... ^

eral

or

clared

in this Act.'

"(2)

Provides

that

the

I.C.C.

petitions involving intrastate rates,

of

types

the advantage of the railroads.

"(4) - Brings- under regulation
"With this knowledge to guide motor haulers which in
the past
them, members of the two con¬ have
escaped regulation by posing
gressional subcommittees designed as
private carriers while 'actually
measures
to give immediate re¬
selling for-hire transportation ser¬
lief in acute areas and to begin
vices.
;,"V^,
;V/-'yv.'" 1
<- ■"
long-range studies in others. The
"(5) Gives the I.C.C. jurisdic¬
resulting Transportation Act of1958 covers these specific areas: tion, in certain cases, over discon¬
tinuance of the operations or ser¬

Interstate and Foreign Commerce
Committee, headed up by Repre¬
Harris

many new
new

that

expedite its handling of railroad

Oren

to

to the

importance

defense of the United States'

Subcommittee of the House

sentative

of

and

of

to

be

and

ap¬
'strengthen and
improve the national transporta¬ plicable,' and shall not hold rates
up to a particular level 'to pro¬
tion system' was highlighted
by
the Surface Transportation Sub¬ tect the traffic of any other rhode
of transportation, giving due con¬
committee of the Senate Inter¬
sideration to the objectives of the
state
aq,d
Foreign
Commerce
national transportation policy de¬
Committee, under Senator George

need

to

;

dispensable

activity

*

,

certain

railway supply industry generally. In addition,
machines are under development for doing

of

consider

and to national defense.

*

■

-

.

increasingly

of the dramatic cost savings which can
through mechanized track maintenance. Use

gained
"gangs" of machines has increased remarkably in the
past two years, and their use is likely to continue
tq!
grow. There
also^seems to be a trend toward extending
the length of maintenance sections, which also requires"

burden'

from

;
are

aware

transportation

in par¬

and in 1959.

of

It

modities

year

Managements of American railroads

merce.;"'

"(3)

expenditures

new equipment, our firfn has, been /fortunate' in - re^ 'v
ceritly introducing a: series of^ nevv inachihes Jor whicl^
railroad; have specific-'needs,4 and on which capital
expenditures 'dan be; amortized, vety quickly.'
{

of maintenance

the business reces¬

have .reduced

railroads

for

plication of the agricultural

stances

"The

• -

We

British, including railroad

both

that

railroads and other carriers is in¬

economic

have,

our

our

Britain, do not like. We either stem the tide

on

Sound

to

and in

J. B. WILLIAMS

*

•

-

,

■

"

Congress for legislative action
the
big
underlying
causes
transportation trouble.
"The

There %

we

President, Railway Maintenance Corporation

*

tions

Senate

be

general and railroads
ticular found themselves.

establishing A. Smathers of
Florida, and by tbe
private truck and barge
Transportation and Communica¬

*(2) Approval of the six-point
Transportation Act of 1958 by
both

and

moving

of Washington

signs

transportation,

tress

in

that

sources

thinking we
do not feel that it will be too long before we start up

in

policies.
carriers

saucer

tation, had darkened the economic
plight in which common carriers,

further action to right existing imbalances caused
by clashing

for

ad¬

a more

we

many

tion of various forms of transpor¬

brief statement by Association of
American Railroads. Speaking for the
industry, the trade group
is certain Congress is more aware than ever of the need for

aid

indication from

every

sion, coupled with long-standing
inequities in
the
government's
regulation, taxation and subsidiza¬

and commented upon in a

transportation legis¬

,

to passenger service because

revealed

Recently passed "Transportation Act of 1958" is summarized

on

must

ings

New Rail Legislation Summarized

Action

while

Western Pacific

reached the bottom of the

v

.

in this country or we go the way of British
isn't too late, but it is getting awfully late.

Republic's^position.' Our Orders' Makers Institute

government transportation

.

it will result

as

less in the last half than in the first six months.
is

What we are observing in this country now is what
happened to the British railways which became national¬

ized

F. B. Whitman

:

ex-

a

On the

of constantly increasing retirement and unem^ployment benefits for railroad workers that are now far
in excess of those enjoyed by workers in other indus¬
tries, including our competitors in transportation.

20%.

as

We

;

- y "
anticipate that our
gross sales will be less than last year, our estimates in¬
dicate that the decrease as compared with 1957 will be; !

wmte

burden

are

£

the

saving to many shippers and give them
vantageous opportunity to adjust prices.

paying taxes on
like, the
commuter operation it is a public service performed at
a loss.
The many areas in which relief iftiist be afforded
at federal, state and municipal level are too numerous to
detail, but the above are the fundamental^
Railroad labor organizations must take a new look at
working rules which impose unnecessary. cost upon the'
users
of railroad transportation or see their, working
membership continue to recede while oui'f ebbopetitdrs
take our business.
The leaders of organized labor must
sit down with management and make a statesmanlike
effort to modernize working rules,
'V*. V
.Congress must cease imposing on the railroads the

inclined to anticipate that total steel production in 1959

might exceed that of 1958 by

wiuiam

provide public service at a loss.
The

capital goods field. ♦ This is not easily nor quickly re¬
versed but we believe that it will begin to be evident

the

been

on

West Coast business inasmuch

lift to

a

•

over

facilities devoted

We are also beginning to see the first signs that the
inflationary pressures generated by monetary and fiscal
policy will take hold sufficiently to reverse the down¬

has

here

pect that this in itself will give quite

be

taken

1958.

bills

severe

more

freight bills of long-haul shippers
as compared with those moving their

repealed.
The commuter operation must be
by some sort of public authority because the
railroads' shareowners cannot be expected any longer
must

m.

freight

on

"Make work" legislation where it exists

tax. collectors.

to

,

The railroads must cease to be fair game for the

level.

strong

•

levy

somewhat

traffic for Shorter distances.

competi¬

-

.

was

as

3%

in

of

>■

shippers in Washington, Oregon and
California because the impact of

break.

an even

Far West .during

in the

appears

,

government owner¬

is

now

expectations,
we
are
confidently
looking for improved traffic during
August and for the balance of the
year.
*
/.
*
The action of Congress in abolishing the 3% tax on freight transportation should be of help to industry
as
a
whole and particularly to our

a

opportunity by imposing ade...
quate user charges on our highway;; .waterway and .air¬
way competitors for the use of facilities provided with
public moneys; the alternative is SUBSIDY FOR THE
RAILROADS.
•
v :
' ' ' \
;
Also regulatory laws and procedures must be modern¬
ized and kept modernized at both the federal and state

months we have watched
6teel consumers reduce their inven¬
tories even when their own activity

Three

into,

which

recession

sults have been somewhat below our

tive

For many

tion.

gotten

industry, has

the

artificial restraints to equal

flash in the pan.

a

industry, were pretty
Subcommit¬
and well set forth in the report of

The latter includes the removal

is

this development

that

&TIudson'Company

before the Smathers

early this year
committee.
That

suffered

has

to be drawing to a
close, apparently the effects of the recession have not>;
been felt as severely on the West Coast as in other parts
of the country.
While our July re¬

'

WHITE

business

While
the

ship; with all that it portends ahd
which everyone
will regret if- it
.happens—the other is to give -the

steel

believing

'

"

'

,

the railroad

of

at hearings

choices—one

Corporation

does our changing order position indicate
industry has passed the bottom of the

only

the

'

inadequate earnings, outmoded reg¬
ulation and subsidy to our eqmpeti-v
tors in the transportation field, all-;
over A long'period of year?, show up. ;
quickly when business recedes.
The
American people have two *;

im¬

pull—for the rest of 1958—only an

For the short

;

warning for a long time, but.it fell
on
deaf ears.
Now the ravages of"r*.

good for the long pull.

to the

;

WHITMAN

B.

President, The Western Pacific Railroad Company

precarious condition should surprise no one.
We have been sounding the :£

start has been made—only a start, but at
the right direction—toward correcting
fundamental ills that afflicted the railroads long before
ihe diirrent business recession came along. That is all
in

start

a

problems

well aired

maxi¬

other hand, a
least

/

;

President, The Delaware.

industrial output. >

mum

program.

WM.

The

F.

is one example oj. this type of effort. At the
we
are
striving to improve our customer
and our quality, both essential to a successful

time

same

service

a

.

(618)

recognizing,
rates

on

not be

in

addition,

that

traffic within states must

so

low

as

to prove an 'un¬

"(6)

Extends

"Passage of the Transportation
Act

of

1958, according to Daniel
president of the Asso¬
American
Railroads,

P. Loomis,
ciation
of
'makes

positive contributions to
transportation pol¬
icy and to relieving railroads of
sound national

of the competitive handi¬
which are the fundamental
cause of their present serious state
of physical and financial health.'
somq
caps

"However, he added- the ur¬
for further congressional
emphasized by the adop¬
tion
of
Senate
Resolution
303,

gency

action is

which

authorizes

terstate

and

the

Foreign

Senate

In¬

Commerce

Committee to study and report on
other irw|)Ortant phases of trans¬

'fair

such

sure

a

and

are

equitable fed¬

necessary' to as¬

system, calls for the*

study of the following points:

;

^«

"(1) The need for regulation of
transportation under present-day
conditions

and, if there is need
regulation, the type ahd char¬
acter of that regulation;
■
V
"(2) The area of federal policy
dealing with government assist¬

for

provided the various forms
transportation and the desira¬
bility of a system of user charges

ance

of

to be assessed

against those using
facilities;
"(3) The subject of ownership
of one form of transportation by
another;
f
"(4) Federal policy on the sub¬
ject of consolidations and mergers
in the transportation industry;
<
such

"(5)
the

Policy

kind

and

considerations
amount

passenger
service
necessary
serve the public and provide
the

for

of railroad

to
for

^

national defense;

"(6) The problems arising from
action
by the
Interstate
Com*
merce
Commission in permitting
the charge of more for a short
than a long transportation haul
over

the

same

direction; and

line

in

the

same

>>

"(7) Additional matters of fed^
eral
regulation (and exemption

Volume 188

Number 5768

therefrom)

and

tional policy
forms

of

federal

.

.

road situation and its effect

promo¬

national transportation

in regard to various

transportation."

Mr. Loomis

said

.//

the

that

Financial Chronicle

The Commercial and

.

"The Senate

-

January

areas

to" be studied under the resolution

13

0

the

though

.

weeks.

than 20 hours of work at the pre¬

clearly .matters of great and time 103 witnesses were heard, in—
representatives of \ rail¬
far-reaching " significance,
espe¬ eluding
cially to railroads. As entirely self- roads, motor, air and water car¬
supporting, tax-paying carriers, he riers, state regulatory agencies,
continued, the railroads still must the Interstate Commerce Commis¬
compete
with
other
forms
of sion, the Department of Defense,
transportation whose costly fixed Commerce and Agriculture, ship¬

vailing average wage, in 1957 the
requirement would
have
been
nearly 46 hours. To be sure, larger

.

provided,

to

hearings

be

toungeTwSker^te
dt*r

the
-

ta

®

sion of Congress in obtaining
remedial

+1

and

'equipment,'
pointed out.

stems -from the announce¬

Commerce

that r the
Subcom¬
mittee • would hold /hearings to
look info the 'deteriorating rail¬
Committee,
Transportation

Transportation ,Act

v

the

of

What

held

hearings will
carrying
out
the

in.

the

that

extent

mated actuarial

Social

reasons

sional efforts

,be

to

.

,

insurance-

Security Benefits

,

amount;

com¬

ther

well

war,

fortunate

of Social

Survivors Insurance, to

be accom¬

follows the pattern of

tinkering to
coverage
and liberalize
which has occurred in

broaden
benefits

each election
1950.' •' ; y

/"The
risen

starting with

year

/'/

•

price index has
month
except three

consumer

each

since

March, 1956.
It has more
than doubled since the Social Se¬

our

program

'full

seem

at

employment' commitment
variance

with

/•'' //.

"

gram.

was

";y /

this

pro-

y.v y.

.

group

benefits.

"No

be

doubt

million

/

these

look

the

meet

more

than

5

million

whose payroll
taxes
the growing burden?

Already, benefits have far out¬
stripped early plans, and trust
fund

reserves

decreased

in calen¬

dar 1957 and in fiscal 1958 for the

more

increase

—an

the

over

"The

as

65

which have

over

—

con-

Ju,

in

the

eULve

rise

the

1975

■* "

is

1957.

years
as

on

the
in

/

:

quite

!

anci

month.

show

a

deficit

of

for the first half

jujy wiii aiso be deficit rid-

S

Furthermore, the latest



of

ness

typical employee
average
production
.

.

a

price

may

nominal

ranging from $1 to $2 per
Now it has risen to nearly

14

$74 qqq-

*

'

®

-

the

j

Edition

New

itis^"eportTd

Formal

Transportation
Dinner

nual

The

of

wfu
wel

teriorated considerably. The Bos^

|Qn

/to

of

a

operated

at

a

$3,453,000 and is faced
maturity amounting

bond

$17,000,000 in 15 months. •
In

-

also

Maine

to the

contrast

riers,

those

in

Eastern

other

car-

sections of

country are faring much bet-

{er>

jn iarge part to the heavy
Also, many of

movement of grain.

roads have costs under bet-

these

ter control and have the physical
registered representative of the property in good condition. One
banking firm's Dallas. proposal now under consideration
office, Fidelity Union Life Build- which has all of the rails worried
ing.
.> /
is the bill which would increase
: Mr. Casper has been associated
their share of railroad retirement
in the investment banking indusan(i
pension
payments.
This

investment

1953.

would

that, Mr, Casper was the
of Atlas Manufacturing Co.

some

1958/

'

irran'TTninn^rnmmprhelp. tax
Burge & Kraus, Union Comme ce exctseAlso,
on

Sept.

1

will

admit

the elimination of the
on

freight shipments is

ing by private truckers.

P.

Gawley to limited partnership.

.

'

t-i
I
,
,
-Trank J.

Frank

J.

I,.

L/OUgnlin

Coughlin,

:

/•////-,

•

Defense

Trans¬

established in the interest of pro—;

member of

prepared-'
reali— ■»
transportation

transportation

moting

and fostering a keener

military

of

Trans¬

Joint

The

requirements.

'This year's Award winner, Mr.

ing his career he has served asi
chief
executive
officer
of
the
Association of American Railroads,

1947-1957;

first and organizing
the Civilian Com¬

as

Chairman

of

ponents Policy Board of the De¬
partment of Defense, 1949-1950;
as President of the Defense
Ori¬
entation - Conference Associati on*
1955-1956; and as Chairman of the
in the
Pan American Railway Congress
U. S. National Commission

Association, 1950 to date.

]

/,

/

Major Contribution 4 /

/
'

Mr.

to the

Fancy's major contribution,
strengthening of transpor¬

tation for defense has been in

in

leadership

the

American Railroads, the
and

his

Association o:f
unifying

standardizing operating

of the railroad industry.
capacity, he was influen¬
tial in ensuring the procurement
of essential equipment to enable
the railroads to meet both ordi¬

have

received

tax

commercial

nary

demands

of the

needs and the
national defense

program.
His

.

relief

from municipalities, but not those
serving
New
Jersey.
This has

and through assignment of
officials, with tne defense

ally

with

authorities,
Commerce

the

Interstate

Commission and with.

Administra¬
the development of their

Federal Civil Defense
in

tion

plans

for

transportation

him

for

tions.

/

many

in

the

has mer¬
Defense cita¬

event of enemy activity,
ited

|

cooperation, both individu¬

A.A.R.

Some of the rails in New York

State

?

and retroactive
should be of some

pay

Mldwest

•

c

heavy

lna^dmMidweSst° Stock Ex^ hoped rails which hadtraffic mov¬
btocK:
to bring some been back
to the
and

St.

In this

Higher mail

p

changes,

the

in

agency

a

mail payments

Ohio

William H. Evans and Edward

V

^

National'

The

burden on

place

in the past year.

Ball, Burge Partners

York

An¬

at

held

Hotel

Louis, Missouri on November 12,

of the roads whose cash po-

sition has declined rather sharply

/

*

be

Faricy, or many years has been
recognized as a leader in the field
New of transportation, with special ref¬
erence
to national defense. Dur¬

a-

\

Association's

to

Sheraton-Jefferson

be

Defense

National

the

at

made

Faricy

will

Award

Annual

Ninth

T.

,/:/■' ///■- /•"
presentation
of
the*
-

the

to report a deficit of $1'00(|'000 for
July/ Its cash P°sitlon has de~

Turner, Inc., members of the New
York Stock Exchange, announced
the association of Harry Casper as

:

Vv imam

/■'";•■/'//"

ty."

the

$7BOOODO
fbwed a loss of $4 ^00

I"

/DALLAS, Tex.—John W. Turner,
President
of
Eppler, Guerin &

t

na¬

securi¬

tional

it

largest since

maintenance

,erred

deficit

try in the Dallas area since

in,

industry
support of

than

bankruntcv in iq4q

g™ -hciwed^aToss

level

$8 per

month. From 1937 to 1943,
the factory worker with three de-/
pendents would have paid no Fed¬
eral income
tax.
Now the levy

of

Railroad

smaller

much

4

oro-

Harry Casper Joins
Eppler, Guerin, Turner

.

World War II,

was

the

security

the

transportation

the portation Committee of the Joint
other tw0' but an imP°rtant com- Chiefs of Staff selects the annual
mutCT road, reported a deficit of winner of the Award. ;•••"*• / v

Jersey,
4^

>

will-o'-the-wisp."

a

owner

manufacturing

In

and

to

effective¬

the

ness

lifted some burden from the comestimates prepared by the fund's would be nearly $300, assuming a the Chicago Board of Trade and muter lines.
a partner in Rodman & Renshaw,
trustees foresee further shrinkage standard
With
respect to
government
deduction.
And Social
ahead. At a time
guaranteed loans, one rail official
 of serious budget Security tax payments must be Chicago, passed away July 24.
first time.

most

be_

<-ien

Prior to

crossed

a

cost

contrib¬

uted

portation Association is a military$4,000,000 and $5,000,000.
civilian group
of .transportation
Central, second to
leaders whose annual Award was
the Pennsylvania, also lost more

_

■

■

1937 through

annual

have

tween

with

been the effect over

"What has

achievements

The New York

and

inflation

nersistent

goal- of

prove

payments

two lines

combat

nrevent'

Increasing Contributions

amount

wiu

carefully^ at the latest than $25,000,000

action 'to

6 million
the future

record

benefit

the

calendar

the

the

a deficit of more
$25,000,000 during this period
and it is officially estimated that

>istent and successful government

of nearly

and

that

From

m

than

/-The. Central

charted trend of tax

The

receipts

such

Railroad, the largest

industry,, showed

growth ficiaries, particularly prospective,
should realize that, without conThe expansion

or

present

financial

one.

shows

Twenty

systems went

months ended June 30. Pennsylivama

de¬

revealing.. The growth of the trust
fund from which benefits are paid

to

East.

rapid

is clear.

course
•

be

will

10

earnings statement

year

whose

person

commuter

lines, • mainly in
of the 37 big
more ■ than
$86,000,000 into the red in the six

proposals -in the light of the past
record. They will find compelling

-

worker

and

of the

'

...

.

financial policies

payment status at the
close / of each-? year has doubled
since 1952.
Since one American
current

But what of the 74 million work¬

must

first half

number of persons report¬

the

employers

some carriers, particularly in view of the

"the

as

the

the dangers confronting

i

»

Aids Inflation
,.

ing taxable wages.
in the number of beneficiaries in

in

Award

easier for

zation

beginnings

and

steady

a

in the

who were receiv¬
ing monthly benefits in May, 1958.
ers

<1

will

larger checks would

persons

7

.mortgages and .real es-

pression legislation in 1935, which the program now under wav will
way
aimed to provide a minimum floor be available earlv-in 1959
Priof basic protection, constant pro¬ wate research erouM are also at
vat~ research groups are a so at
gram change has 'complicated the work to learn more about private
complex.'1" Now there
are
few ,and public pensions and their inworkers not covered.
There has fluence on our economy. Bene.been

it

discontinue

While encouraged to some extent, many rail men cannot forget

Eastern

'•

good news to upwards of 11.8

of-business

the

enjoying

now

to

•

"From modest

•

in

r

bUlihtfwas.i

thani $34

securities

fiscal '/•/ To S°.ntlnue to liberalize benefits and increase taxes will help to
would do .perpetuate the loose fiscal and
in

also makes

carriers

ment and production in the tradition of a free economy.

Trust Funds Decline

/

Act

rnent through-stimulating- invest-

instituted,
giving the 1935-1939 dollar a pur¬ to $23 billion in mid-1957 is im¬
chasing power of around 48 cents. pressive until one realizes that it
While that may seem a prime ar¬ is substantially below the forecast
gument for increasing benefits, it of 1935, both in total and relative
would only add fuel to the upward to
projected
benefits.- Further¬
spiral. There can be no satisfac¬ more, it is less than three times
tory security unless the dollar has present annual benefit payments,
stable
purchasing power.
Thus, lowest on record, and compares
the
inflationary implications
in with a recommended ratio of four
curity

in-

iuls P'aln which procedure

«e"

as serious an emergency 'as
and less with the relatively

tion,

that further liberalizing

panied by a higher wage base and
accelerated tax increases.
T his

life

closing hours of Congress, but to tabuted to our inflationary trend,
concern themselves more with the
-Now is the -time for -the* millions
basic problem of controlling infla¬ of beneficiaries and taxpayers to

question, how secure is Social Se¬
curity. The "Letter" states;

Security benefits may be
voted despite reported Adminis¬
tration opposition and of another
new
high in June for the con¬
sumer
price index recently ap¬
peared on the same day.
The
House Ways and Means Commit¬
tee has agreed upon a 7% increase
in
benefits
under
Old-Age and

States

which

United

offers the most promise of repay-

into

hastily

act

of

companies

in

jeir
toillion in

fund

Legislators

to

not

*

Federal

complicates

operations.

National

advises Congress
not to
act hastily in increasing
CX A. S. I, benefits in raising the
Bank of Boston,

/'News

'

American Railroads.

ease

.

.

more

invested

deficits and rising debt/ this- fur¬

August issue of the "New
England Letter," a monthly pub¬
First

to

unusually
creased >ordinaryn and
industrial costly trains
and
services
and
policies in force-by over $180 bil- fgenerally recognizes that the raillion frbifi 1937-1956.' They added roads no longer have a transpor$7-0 billioh to. their, assets. Of this: ■ tation monopoly

need to tackle problem of controlling infla¬

The

The

tended

*

in

.

perpetuity of 0.57% of payroll"; and calls attention to re¬
search studies that will not be available until fearly 1959.

of

have

his

upon

,

tion; cites official findings that the shrinking O. A. S. I.
has "an
estimated actuarial insufficiency, computed

lication

conditions

defense

leadership in the Association of

.

determined.

favoring caution and delay in current Congres¬
to further liberalize Social Security benefits.

Refers to greater

com-

emphasis

?

one

First National Bank of Boston offers wliat .it considers

pelling

Faricy to Receive
Transportation Award

puted into perpetuity of 0.57% of somewhat
the
misgivings exWilliam T. Faricy, former Pres- '
payroll.' ',
.
pressed in some quarters earlier
ident and Chairman of I the Board'
thing is certain. The Con¬ // ''The Old - Age and Survivors in the year. However, the situa- of
Directors of the Association of ;
gress is more aware than ever of Insurance trust fund is by law in- tion has not been fully cured at
American Railroads, has been se- !
•
.
the
effect, clashing
government vested only in United States Gov- the present time.
lected - to re- /
The new. rail legislation authortransportation policies have on the eminent securities. The more than
ceive the 1957
various carriers
and
billion
accumulated • since 'izes government guarantees of 15recognizes' $22
National
De¬
the
need;,for further action.to! 1937, when needed, Will have to year commercial loans of up to fense Trans¬
right the *grave imbalances still he / provided - by the Treasury, ' $500,000,000 to the industry for
portation Aswhich has. only two sources—taxes 'new capital
existing."
/... /
*'
investments, equip- sbci a tion
or borrowing. ' Contrast this with
ment and maintenance. The new
remains

303

But

Bosfon Bank Advises Congress to Go
on

The slight improvement in traflie and improved general business

esti-

insufficiency

.

studies to be made under S. Res.

'the-'record

Slow

'an

has

fund

,

;

1 h!S factor had much to do in ob- /Recognized leader in transportat^lninS th(F recently enacted
tion field is to be cited for his
Transportation Act of 1958. '

not funded, and
of Health, Educa-

trust

that

judgment of the Interstate Commerce Commission.

The possibility of bankruptcy
sjj*1 facfs |*on?e of, *be carriers,

are

Secretary

doubted

be up to the

some

However

^

.

he

"

count?v

of th

lion, and Welfare recently stated/

V

"To
be

ment last November 22 by Senator
Warren G.Magiiuson, Chairman of
the Senate Interstate and Foreign

Surface

1958.

obligations

Act, and these led to

final

the

Loomis

/Mr;

[ 7'The transportation legislation
passed by this session of the/Con^
gress

Commerce

legislation.

stated

of the roads needing the funds,
could qualify.
However, this will
any

those serving the Eastern section

.

largely by taxpayers.
•
1 > held in the House.
,.•/.! We should stop calling this
.Vv "'To these important problems \ "As a -result of \ the hearings, program 'insurance,' as ^this term
of public policy still to be resolved omnibus bills were, introduced, in is generally understood. There is
must also be added continuance both Houses
containing a series no contract to which a beneficiary
of the 10% federal excise tax on of amendments to the interstate may look for 'performance.'
Its
railroad passenger service, mid in¬
adequate and unrealistic depreci¬
ation allowances for railroad plant

recently

ses-

slh]mia
v/065 n0t
their'
troubles are over, particularly for

-

'

„

some degree

pf, success during the present

expected

t

..

.

benefits, but the proof of

andfclouidv f/ture

were

mK.

.

purchase somewhat greater po-

tential

agriculturalgroups and labor
organizations, economists, analysts
and others. Similar

would

contributions

pers,

maintained and operated by gov¬
ernment out
of funds .supplied

income.5 Al¬

weekly
wages
steadily, so has the

average

;

risen

hearings opened on
continued
for burden. ; Whereas the 1937 tax
During that* would have required slightly more

and

are

facilities continue do be

taxable

in

included

have

11

tnan

more

on

picture.'

2a

(619)

24

The Commercial and Financial Chronicle

(620)

Continued

study of soil reclamation proce¬
dures, with the result that millions

from page 3

acres

been

Southern Industrial Growth

new

Industry

the

high,

are

authorities
return

have

The textile

competent
that

industrial

the

on

search dollar

as

computed

re¬

is 1,200%.

industry,

as a

whole,

is in the strongest position in its
entire history.
The productivity
per

man-hour of the industry has

risen at the rate-of 3.6% per year
since World War II, which com¬

favorably with the average
industry. Today's equip¬
ment is vastly more productive

pares

all

for

than in the past, so that while we
have
been
discarding
930,000

and account for

nation

in

1925.

With its
and its

fat trimmed off

excess

productive muscles in the

best condition -ever,

the industry
fighting trim and
forward to again be¬
dynamic growth indus¬

is in excellent
can

look

coming
try in

a

the

Golden

Sixties.

By

1965,

out

worn

land

land forever.

The

has

South
of

the

been'un¬

fact

that

one-third

grass

Governors'

Southern

Conference

which

and

by the Southern Association
of Science and Industry;' It is
obvious
that
a
tremendous in¬

The

scale

to

growth of population
accomplished without a

be

leads

to

the

pro¬

of

basis

impetus for the
livestock
in

the

on

South

a

world's

substantial reduction in the pres¬
ent standard of living.

pro¬

that

was

sources

has

rests

on

a

firm and

produce

of

to

The

try

.

a

the: fact

that

the

basis.

of

the birthplace of American indus¬

bale of

1900? completely mech¬
it

pos¬

to produce a

bale of cotton
only 38 man-hours of work
today.
And
improved
growing
practices, such as the use of better
seed and fertilizer, have doubled
the yield per acre over the
past

lead¬

South

was

cross

they

section

of

comprise

third of the total land

area




the effect of minor elements
upon soil
productivity. Hand in hand with
of the this work has been an intensive
one-

New

England

same

period.

area
during the
On an average, a
plant was com¬
pleted each working day for 10

per¬

was

a

dollar

million

built

Soto

de

seven

years.

the

floating

crude

the

on

their vessels.

oil

,

.

a

proportion of the nation's manu¬
facilities has increased
in 1900 to 22% today.
Of the $26 billion expended by
the government and private in¬
dustry for wartime -construction,
$412
billion was spent in the

facturing
from 9%

scum

to

caulk

water

This is the first

.

result of this phenomenal
construction program, the South's
As

Sabine Pass in Texas

near

collect

orded

use

of

rec¬

a

*

nation.

ence

and

prosper,

by

1810

the

3,000 years ago, and in South
America the Peruvian Indians of
the time of Christ were weaving

Cleat, Ala., in 1955

be realized from

section

ever,
which

land

the

the

endowed

of

the

majority of the people, and
industry declined. In 1850, the fac¬

ern

other

:

~

Chemicals

.v

v

t

...

An outstanding example is the
synthetic fiber- industry, which
started from scratch -less than 20
years ago with the^development
of nylon and is a billion dollar
industry today. The production
of synthetic fibers is a southern
industry, all of the manufacturing
plants now in operation being lo¬

the War for South¬

came

any

large number of highly technical

were

products in the United States.
Then

than

more

the

of

produc¬ industries.
ing only 14% of the manufactured ;
■
tories of the South

for

-resources

country. Of even
greater importance-is the fact that
it is making rapid progress in de¬
veloping a leading position in a

magnet

attention

of

industry, the South is

richly

agriculture, how¬

became

attracted

field

the

new

Independence, and when the

sound and fury of this great con¬
flict had passed away, much of the
South lay in ruins. While prop¬

erty of all types had been de¬
stroyed by the invading armies,
industry, had been particularly
singled out for destruction. This cated in a Tather narrow- belt' excoupled with a lack of capital for tending- from Delaware to Ala¬
new
enterprises,
reduced
the bama. In addition, all new plants
'

South's

proportion of the nation's

manufacturing facilities to 9% in
1900.

But the

under construction'are in the

now
same

turning point was

area.

'

location

The

:

of this

important
industry, industry wholly in. the South is
long entrenched in the New Eng¬ a direct result of file; region's
land area, started to move South commanding position as a cottonto provide the broad and enduring producing area. While the textile
base upon which southern indus¬
industry was initially established
at

hand

as

the

textile

try could build.

in

New

the

started to
The
The

Industrial

most

Revolution

significant factor in

the
to

be

England

states,

it

move

into-the South at

of the

turn

century in order

closer to its

raw

material

As a result,. 52% of the
country's textile industry is lo¬

the economy of the nation today
is the industrial revolution sweep¬

supply.

ing through the South with

cated in the southern states at the

un¬

diminished vigor. Starting at the present time. Since-the textile in¬
turn of the
represents
the
largest
century, gathering dustry
.

.

that "the Indians

some

In

South

had 30% of the industry of the na¬
tion. Due to the large returns to

When Columbus discovered
on Oct; 12,1492, he stated strength
during the depression
swam out to our
years, and expanding with almost
vessels bearing bales of cotton
explosive violence during the war
yarn which they exchanged with years, it has come to full bloom
us," the - first recorded commer¬ during the last decade. One of the
cial transaction in the New World.
mightiest forces in the nation, it
Among the treasures which he continues to enlarge the basis of,
took back to Queen Isabella were the
economy of the South and to
skeins of these same cotton yarns.
provide a higher standard of liv¬
But even at this early date, the
ing for its people. To dramatize
industry was an ancient one. Cot¬ its impact upon the region, the
ton fabrics of good quality were First National Bank of Atlanta re¬
produced
in
quantity
by
the cently asked "What goes on in
try.-

at Point

preparation of pitch from that the South would have 3i0%
the
country's ; manufacturing
southern pine by Don Teodoro in of
1527 was the beginning of the facilities by 1965, and that in or¬
der to do so it would be necessary
great naval stores industry. The
first plant for the production of to build three large plants each
rosin and turpentine on a per¬ day during this period, or a total
manent basis was constructed by of 10,000 plants in 10 years. This
Captain John Smith of the James¬ rate of growth, considered to be
town Colony in 1609. By 1619, the fantastic at the time, was exceed¬
colony had three iron works, as ed in 1956 when 1^059 new plants
well
as
sawing mills and salt were added to the southern manu¬
facturing potential.
Over
1,300
plants.
J
Manufacturing
continued
t o plants were built in 1957.
The

America

Virginia, Kentucky, Ten¬ er in the development of new and
nessee, Arkansas, and Oklahoma, improved types of
fertilizers, and
may be considered to be a repre¬ has pioneered in the
study of the Pueblo Indians of the Southwest
as

The first white

Fernando

chored

work

secure

20 years, with
a
corresponding
stretching' from Delaware to increase in
quality.
Texas, and the five interior states
The South also has been a

country

TexaSj Louisi¬
Mississippi, Alabama and the
northwest corner of Florida, ac¬

petroleum product South to double the area's indus¬
increase in population, but to do
in America, 64 years before the trial plant capacity.
Today, the
so with a concurrent improvement
first
English
colonists
stepped South has 33,706 manufacturing
Beef yields of 500 to 600 pounds
in the standard of living. Its pro¬
ashore at Jamestown.
establishments, of which 15,000
per1 acre
annually on improved
duction of foodstuffs has increased
Although many years were to employ 50 or more workers. Some
pasture are common, and yields as
five-fold during the past 50 years
high as 1,200 pounds per acre of pass before these pioneering uses 22,000 new industrial plants have
with the same farm labor force.
located in the area -since 1939, and
irrigated pasture have been re¬ could be exploited fully, each laid
And it has only begun to apply
its industrial output has increased
ported. And milk production now the basis for a large and expand¬
the available technology. Agricul¬
from $11 billion to $65 billion dur¬
ranks fourth as a source of farm ing industry in the South. Today,
tural leaders have stated that the
income in the South. Grass which the South has 52% of the textile ing the same period.
systematic application of known
In view of these considerations,
once covered the earth in an end¬ industry, 39% of the chemical in¬
farming procedures would enable less blanket is
coming back into dustry, and 38% of the petroleum the writer was led to predict at
the state of Texas alone to feed
its own.
manufacturing facilities of
the the Southern Governors' Confer¬

vestigate -"the impact of the ex¬
sible
pected population growth of 16
with

sentative^

cludes the states of

the

increasing proportion of the
is being converted to per¬
manent pasture, with the result
that the South today is the fastest
growing cattle raising section of
the country.

ample re¬
to not only support this
South

the

cotton in

of West

captive.

to set foot in Alabama

land

detailed consideration of the

therefore, to in¬ anized' operations make

million persons in the 16 southern
states during the present
quarter
of a century upon-the
economy of
the region.
These states, which
include 'the 11 tidewater states

rapidity with

South has been build¬

the

ana,

chemist.

an

A

factors involved indicates clearly

States, with 6% While -283 man-hours
people, produces was required to

50% of the-world's goods.
It is
desirable,

dian

large

.

aggravate this condi¬

the

3527. They were tarred with pitch,
which a Greek chemist, known as

son

,

the United

the

illustrate

its manufacturing potential,
Gulf South area, which in¬

ing

brigs in the Spanish settlement on
availability of forage during the Tampa Bay in 1540 for his expe¬
winter months
from
the
cover dition leading to the discovery of
crops used to prevent erosion on the Mississippi river. Three years
row crop fields.
This winter graz¬ later, ships carrying the survivors
ing proved to be so profitable that of this expedition to Mexico an¬

South if this
is

turn

first

duction

production of food¬
stuffs
and
manufactured goods
must be achieved throughout the
in the

crease

in

duction of cattle.

growth of the South's poul¬
industry has been equally
spectacular, increasing 800% in
3 5
years.
Farm
income
from
chickens
and
eggs
amounts to
nearly $1 billion per year, a sum
25%. Given means to provide the South will come into her own
greater than the total income from
new
products required by this when her fields are green in win¬
cotton and
cottonseed
15 years
rapidly expanding, economy, and ter" has finally become a reality.
ago. Georgia is the largest broiler
This statement was based
on
making full use of the new fibers
producing state in the Union.
available, the textile industry can sound logic. Cotton and tobacco,
To feed its constantly increasing
indeed look forward to a more the two great cash crops of the
livestock and poultry population,
region, are now crops and their
rewarding future. ?
the South is largely increasing its
cultivation takes a staggering toll
As the southern textile industry
of the soil resources of the South. grain production. Improved grow¬
is one of the -most important
seg¬
The sales value of the cotton crop ing methods have made it possible
ments of southern
economy, it will
to double corn yields in many sec¬
in the southern states, approxi¬
be well to iook at the
growth pos¬
tions of the South, and in 1952 the
mately $21,£ billion per year, must
sibilities iOf the region.
be balanced against the fact that top corn yield in tlie country—
One of the greatest
problems
241.1 bushels per acre—Was ob¬
land in continuous cotton produc¬
confrontingus today is the un¬
tained by a 13-year old 4-H Club
tion loses 32 tons of soil per acre
precedented *g ro w t h in world
annually. In tobacco fields, the boy in Prentiss County, Miss.
population. ^Estimated at 500 mil¬
As less land is required for cotloss of topsoil is 15 tons per acre
lion in 1650/it is 2 % billion1
today, each
ion production due to improved
year.
and is expected to reach 7 billion
Fortunately, this loss of soil farming methods, a new agricul¬
within the next 100
years. This
can be
greatly reduced by the use ture is invading the Southland,
has "been accompanied by a sub¬
of proper cultivation procedures. one based on grasslands and grain
stantial reduction in arable land
Terracing and contour plowing, production' and producing meat,
due -to erosion,,
overcultivation,
and non-agricultural-use, with the particularly when the terraces are milk, and poultry. In addition to
alternatively planted with row largely increasing the income of
result that over half of the
people and drilled
crops, will largely re¬ the
region, it is improving the
in the world go to bed
hungry duce soil erosion. And when once health and
well-being of the peo¬
each night.
the land lay open to the sky in ple through the provision of a
In the United -States, the
popu¬
winter, the widespread use. of more adequate diet.
lation is increasing at the rate of
cover crops of small
grains, le¬
Equally important is the fact
1.6% each,year, which will result
gumes, or grasses, keeps the land that this, green revolution is pro¬
in 200 inillion people by
1970, and green the
year around. In addi¬ tecting the basic resource of the
will double the present
.population tion to
preventing erosion, these South, its land. Sound and. pro¬
in 50 years. It is
generally ac¬ cover
crops add large quantities gressive
management has
con¬
cepted-that 2% acres of land are
of organic matter to the soil, thus verted millions of acres of eroded
required for each person in this
improving its tilth and moisture hillsides that' once grew broomscountry in order to maintain the
retaining properties.
edge, brush, and briars into lush
present standard of living. On this
This development in agricultu¬ green pastures filled with sleek
basis, the country's declining land
ral
practices is revolutionizing herds of cattle. Stock farming is
reservesand its increasing popu¬
the growing of row crops and sav¬ balancing crop farming and con¬
lation wiir-be in balance
by 1970. ing the soil, so that generations
tinually .diversifying agriculture
Further demands for agricultural
yet unborn may enjoy the fruits holds the promise of our even
products must then be met by in¬
of the good earth.
greater return from the land.
creasing the yield per acre, as
With these advances, the future
Living in the. midst of one of
additional land will no longer be
of row crops is assured. The pro¬ the greatest agricultural areas in
available. Industry's demands
duction of cotton, in particular, the world, we sometimes lose sight
will further
as

South

growing on the surface of the Don Teodoro, made from pine counted for one-sixth of all of the
population. While differing earth
construction
in
this
for
uncounted
centuries rosin, the first chemical operations industrial
among themselves in several im¬ made the soil which is our com¬ in the country.
The small fleet country during the ld-year period
portant respects, they are bound mon heritage today. The greatest then sailed into Mobile Bay, where following World War II. The value
together by strong social, political, opportunity
for
increasing
the Don Teodoro volunteered to go of such construction was $3 li bil¬
and economic ties. They are rec¬ total
productivity of the soil lies ashore to obtain water and disap¬ lion, which was six times the
ognized as southern states by the in the improvement of grasslands, peared into the interior as an In¬ value of all industry built in the

population will have in¬
creased by 17 million, and per
capita fiber consumption will be
up by about 20%, reflecting the
the world.
penetration of fabrics into new
This green revolution also is a
markets, such as reinforced plas¬
tics.
The amount of disposable * hallmark of the new South. The
income will increase, with an es¬ statement made by Hugh McRae,
timated 25% increase for clothing. the famous North Carolina farm
Home construction will be up by leader of yesteryear,
that "the

tion

To
which

Florida, by Panfilo de Narvaez in
not

plants located in the

since 1939."

their

to

Thursday, August 14, 1958

.

of its

.

spindles a year and replacing only
370,000 for the past 30 years, the
capacity of the industry is vir¬
tually in balance with normal de¬
mand. In cotton spinning, we are
producing 50% more goods with
50% less equipment than we did

of

restored

mindful
rewards

fineness which cannot be

have duplicated by any known process
original today.
productive state. Agricultural re¬
The
first
ships in the New
search holds forth the promise of World were built at
Apalachicola,
of

And the Textile

a

.

trial

luxurious cotton and woolen fab¬
rics of

.

the Land of Cotton," and answered
it by saying that "Old times here
are

all forgotten in the hustle and
of over 22,000 new indus¬

hum

for chemicals, the
to {produce these
to .supply
this
growing market. Today,; 39%4 of
the chemical industry* of the coun¬
try is, located in the southern
states. As chemicals ir provide, the
single

outlet

South

started

basic* materials

basic

raw

duction
since

materials for. the pro¬

of

the

synthetic fibers,

and

established - textile

in¬

convert the.
libers to fabrics and garments, the
South was the only logical loca¬
dustry

can

readily

tion for the chemical fiber indus¬

try.
Starting with the
of nylon by

introduction

Du Pont in 1939, the

Volume 188

Number 5768

.

.

The Commercial and Financial Chronicle

.

(621)

industry has enjoyed

phenome¬

a

nal rate of growth, expanding 50fold in 15 years. Present sales are
at the rate of 500 million pounds

will

this

increase

to

50%

within

the next decade.

The

petrochemical industry was
only a quarter of a
ago, and has seen its most

established

annually, which, with the auxiln century
chemicals

iary

version

in

used

fibers

the

of

the

con¬

to

fabrics,
makes it a billion dollar industry.
And
its
future
looks
equally
bright. The President's Materials
Policy Commission has estimated
that the production of synthetic
fibers will be at

a

rate of 4 billion

pounds annually by 1975, a quan¬
tity eqiuvalent to 8 million bales
of cotton.

It is destined to be one

of the South's most important in¬
dustrial enterprises.

Du

Pont's

nylon

plants

Sea-

at

ford,

Dela.;
Martinsville,
Va.;
Richmond, Va.; and Chattanooga,
Tenn.; Du Pont's Dacron plant at
Kinston, N. C.; Du Pont's Orion
plant at Camden, S. C.; Chenistrand's Acrilan plant at Decatur,
Ala.; Chemstrand'S nylon plant at
Pensacola, Fla.; Allied Chemical's
Caprolan plant at Hopewell, Va.;
American Enka's Nylenka plant
at Enka, N. C.; Carbide and Car¬
bon's >'jDynel
plant
at
South

Charleston,
W.
Va.;
Industrial
Rayon's plant at Covington, Va.;
and

Eastman's

Verel

plant

at

Kingsport, Tenn.
Synthetic

fiber

construction

rapid expansion since the last

plants

include

under

American

is

based

mental

the

cotton

textile

indus-

entirely

funda¬

upon

relating
to
the
hydrocarbons
to
chemical products. Petrochemical
production in thq South has a
More

than

of

the

are

used

of

manufacture
a

which

has

plastics.

continuation of the trend
been

time

to

under

replace

way

steel

for
with

plastics and the lighter metals.
fruitful

A

field

for
development
provision of addi¬
tional plants in the South for con¬
verting the intermediate petro¬

would

be

the

chemicals
for

the

articles
In

to

plastics,

as

manufacture

the

for

of

well as
plastic

consumer

trade.

this

connection, it is interest¬
ing to note that 75% of the new

plastic, polyethylene, is now be¬
ing produced in Texas and Loui¬
siana.
Monsanto's

of

House

the

Fu¬

this proportion even further. This
is a logical location lor the in¬

dustry,

as

the basic

material

raw

is cellulose in the form of

linters
which

wood

or

are

pulp,

cotton

both

available in almost

of
un¬

limited quantities in the South.
The South is in the happy po¬
sition
corner

the

of

of

being

in

the

winner's

regardless of the outcome

competition between

syn¬

thetic and natural fibers for vari¬
ous

segments of the textile trade.

Her broad cotton fields and mod¬
ern

synthetic

continue to

take

will

plants

fiber
care

of the

reassuring

South

to

Sulphur
age,

that

note

it

at

rooms

Disneyland,

is

than $3

billion, and

are

atomic

South

had

its

industry
start

in

at Oak

center
the

and

the

nation's

source

half

of

nation's

the

new

a

home

can

use

start with two
as

the

on

a

new

car,

a

televi¬

or perhaps a trip to Mars.
Ammonia is an important petro¬

set,

chemical,

particularly from the
standpoint of southern agriculture.
The synthesis of ammonia ranks
with the greatest discoveries of all

the

of

River

South

plant

is

the

located

Savannah

Aiken,
South Carolina. This plant, which
was built by Du Pont, and is op¬
erated by the same company, is
one
of the greatest engineering
projects

ever

undertaken.

The plant represents an invest¬
ment of

$l3/4 billion and produces

fissionable
nuclear

materials

for

use

in

including HRecently,
arrangements
times. Since the dawn of civiliza¬ have been completed for the pro¬
tion, man had been living on the duction of radioactive cobalt, used
accumulated

stores of nitrogen in

weapons,

bombs.

in the

treatment of

cancer.

and this capital was run¬
Important leaders in industrial
ning out in the closing days of applications of atomic energy in
the last century. In 1887, Huxley, the South include the Newport
the great English economist, pre¬ News Shipbuilding and Dry Dock
dicted

that

western

civilization

would disappear in 50 years as a
result

of

available

the

exhaustion

of

all

supplies of fixed nitro¬

gen.

which is investigating

Company,
the

of

use

atomic

power

in ship

propulsion; the Davison Chemical
Company, which is active in the
rare earth field; the General Dy¬

It is sometimes darkest

fore the dawn, however, and

not shown the way

to convert the

the

the

South will

nation's

have half

chemical

industry

within the next decade.
:

Petrochemicals

are

of

the

readily available in
south¬
agriculture would be in a
rapidly declining state of produc¬
tivity today.
•. Another important field of con¬

back¬

region

into ammonia,

sumption of the southern chemical
industry has been in the manu¬
of synthetic rubber. Ap¬

facture

proximately 70% of the country's
production facilities are located
iri

,

the

South.

Present

installed

capacity is 1*4 million tons, and
bone
of the
southern chemical this is expected
to increase to
industry, and over 80% of all of 21/2 million tons by 1975. Without
the petrochemical plants
in the the
rapid
development of the
country are located in the South, synthetic rubber industry during
particularly along the Texas- the last war, using petroleum and
Louisiana Gulf Coast. Petrochem¬ natural gas as basic raw materials,
icals are derived from petroleum the country would have been un¬
and natural gas, the South's most able to prosecute the war to a
important mineral products. They successful conclusion. Today, the
account
for
over
25%
of
the synthetic rubber industry in the
chemicals produced in this coun¬ South contributes substantially to
try today, and it is expected that the area's prosperity.




plants

field
200

vare

in

located

now

2000 will be equivalent
explosion of 10 million

year

the

to

atom bombs annually.

Southern

The

Governors'

Con¬

direct¬
series of conferences on the

ference has sponsored and
ed

a

of atomic energy

in the fields
agriculture, atomic power, in¬
dustry, and medicine. The South¬

use

Association of Science and In¬

dustry

was

Atomic

Industrial

lanta in

April, 1956.

ence

so-sponsor

attracted

southern1

Forum

group

the

ever

an

in

At¬

This confer¬

more

business

largest
discuss

of

than

400

leaders,
the
assembled to

South's atomic indus¬

The

Southern

the Chairman¬
ship of Governor Collins of Flor¬

ida, held a series of meetings at
Oak Ridge, Aiken, Raleigh, and
St. Petersburg.
From these meet¬

satellite

waf

southern

a

base,
in¬

as

even

importance is tha
South, in recent

more

that

the

has obtained several of the
nation's key aeronautical research,

years,

With! this as a base, plus zt,
variety of favorable plant location
factors, the South is well on the
way to become the nation's toj»
region for aircraft development.

to be

grow,

in

the

Texas

than

ranks

the

as

aircraft-producing

are

number

state

one

th®

in

area, with heavy concentrations a#
Fort Worth and Dallas. Employ¬

in

ment

aircraft

the

these two cities totals

economy of the area as electronic

industry in
42,000, with

annual payroll of $200 million.
This is second only to tlie Lo®
an

Angeles

in aircraft manufac¬

area

ture in the country.
(i

Practically every major aircraft
producing company in
the country has one or more plant®
and missile

in the South.

Plants in the Texa®

include Bell, Chance Vought,
Convair, Fairchild, and Temco.
area

Fairchild,
Aircraft

ing major industry.

Hughes,

and

located

are

United
Florida*

in

Lockheed has two major plants in

Highlighting the part played by
Georgia, and is building

the South in the electronics
Texas Instruments

a third,
Douglas and Fairchild have plant®
in Oklahoma, and Douglas also*

field,

of Dallas

now

supplies

more than one-third of
nation's transistors, with an¬

the

has

a
plant in North Carolina,
Fairchild, Glenn L. Martin, and
Flight Refueling are located it*
Maryland. Fairchild has a plant*
in Tennessee, and Hayes has zt
plant in Alabama." ~

$28 million. A

some

host of home-grown industries in
the area are manufacturing such

products

as radio and television
sets, geophysical prospecting
One of the most significant de¬
equipment, magnetic recording
velopments in the South has beer*
tape, radar navigation equipment,
the location of a number of key
and a great variety of electronic

aeronautical

the

The larger companies, of course,
account for
the
largest invest¬
ments

and

the

in

The

the guided

Patrick

mis¬

Air Forccf

Melbourne, Fla., is the»
long
guided missile range which ex¬
tends through the Bahama Island®
past Puerto Rico and across th®
Base,

near

plants in North Carolina South Atlantic to Ascension Island,

alone.

The first horizontal

addition, there is
volume

impres¬

an

electronics

search throughout the South.
of
the
leading groups
is

a

re¬

One

sive

in

ad¬

most

main base for the 5,000 mile

workers, in the South during the
past decade. And Western Electric

In

centers

nation's

the

work

sile field.

tric, for example, has constructed
19 major plants, employing 30,000

has five

for

vanced

employ¬
General Elec¬

research

region/which include several

bases

greatest

ment in the region.

of

V-2

missile

base,
and
launehings

the
are

launching o3t
made

was

at

thi®

earth
satellite*
madp from th»

.

the same area.
Georgia Tech Research Institute
A major research and develop¬
in Atlanta, which has an elec¬ ment center is the Rocket and
tronic computation laboratory, as Guided Missile
Agency (formerly
well as a complete electronic fac¬ the Redstone
Arsenal) near Hunts—
simile system. The Industrial Re¬
ville, Ala. It was staffed by a
search Institute of Chattanooga nucleus of German rocket scien¬
,

has pioneered
an

the development of

tists

brought in after World Wair
leadership of Wero—
her von Braun, who is probably
the foremost missile authority in

automatic electronic control for

II under the

machine tools, in which informa¬
tion
from
a
tape controls the

shaping of

a

piece of material in

the world

today. Total investment
is $150 mihion, ancf
the personnel includes some 7,00®

three dimensions. And Bell Tele¬

at the Agency

phone Laboratories is testing its
new
solar battery at Americus,
Georgia.
As

indication

an

wide¬

of t the

with

civilians
of $40

annual

an

million.

/

payroll

/

.

,

The Agency, under the leader¬
spread nature of the rapidly grow¬ ship of Major General M. D. Meing electronics industry in the daris, is the nerve center for th®
South, more than 100 manufac¬ Army Ordnance's missile researc]®
turers
of electronics equipment and
development activities, and
worth of

equipment at

Institute

the

of

million

several

exhibited

of

dollars

meeting
Engi¬

a

Radio

»

is

increasingly impor¬
national
superior and up to date.

playing

an

tant role in keeping our
defenses

in Atlanta recently.

r

Its

Aircraft and Missiles

neers

tially enlarged, as well as thos®
of related industries and technical

Another

in

rapidly

South

the

is

growing field

the development

manufacture

and

of

all

types

of

aircraft and guided missiles. A re¬
cent
survey
indicated that- the
has

area

missile
seme

some

110

plants,

half

The

Regional Educa¬

tion Board, under

from

aero¬

country'®

installations.

aircraft

compared

end

of

significant aspect

of

dozen

at

the

the

most

South's

aeronautical

expan¬

sion has been its wide distribution,
as

well

as

its

relative

security

enemy attack. Bombers or
missiles directed across the North

against

facilities

activities

being

are

the

substan¬

such a®
the Thiokd
Corporation and Rohm and Haas.
those

at

operated

base,

by

In addition to work in

the missile*

Guided Missil®
Agency scientists are working on
with the
problem
of
interplanetary
and

World War II.

trial future.

artificial

fact

90,000 South¬
working in electronics,
with an annual payroll of
nearly
$500 million. This growth is hav¬
ing a significant effect upon the

of

ern

The

programs.

energy.

Of

V

to

of the

some

tercontinental guided missiles ancl
aircraft powered atomic

an

insure leader¬

which

of

busy with such projects

are

of

is

important electronics

More

erners

-

ern

that the

future
area

components.

the soil,

the

Chemical em¬
ployment is increasing faster in
the South than in any other area,
and over 20,000 professional.chem¬
ists and chemical engineers are
now
employed in the southern
chemical industry. Jit is expected

the

the

to

while various development
group®

that it will be directed

nual sales of

natural gas so

located

have

in

in

way as to

over

region.

near

the?

serve

advanced

<

,

the last few years.

plants

first

,

of

south of the Mason-Dixon line in

.

a

fertile

a

of

by atomic powered electrical gen¬
erating units in this country by

chemical

'•

••

most

nautical

Island,

industry has found the South

radioactive

~

than

Sea

Electronics

ducing U-235. The Oak Ridge Na¬
tional Laboratory is a nuclear re¬
of

at

The rapidly growing electronics

and

reaching

the center

now

nation's

ship for the South in this impor¬
tant development.

process plants
the world, a four-story plant
covering an area of 60 acres, pro¬

just be¬ namics Corporation, which is in¬
this terested in nuclear reactors and
grim prediction did not material¬ nuclear-powered
airplanes;
and
mation of interests is well illus¬ ize.
In 1910, after ten years of the Southern Company, which is
trated at Chemstrand's
Acrilan
research, Fritz Haber achieved the investigating the production of
plant at Decatur, where a sub¬ direct synthesis of anhydrous am¬ electric power from atomic en¬
stantial portion of the company's monia from hydrogen and nitro¬
ergy.
employees continue to grow cot¬ gen. At long last, man had dis¬
The magnitude of the civilian
ton on their farms.
Produced in covered a way to renew his capi¬ atomic
energy
field
may
be
southern plants by southern labor tal of this life-giving element in¬
gauged by the expectation that
from southern raw materials, the
the production of components for
definitely.
chemical fibers are as much at
Over half of the country's syn¬ reactor plants will be a $700 mil¬
home in the South as cotton. To¬ thetic ammonia production capac¬ lion a
year business by 1963.
By
gether with this fine natural fiber, ity of 3 million tons is in the
1965, it is estimated that $7^2 bil¬
they are making a determined bid South, and the major portion is lion will be invested in atomic
for supremacy in the textile field. made from natural gas. Due to the reactors in this
country, and that
The production of synthetic fi¬ rapidly declining reserves of ni¬ from
30,000 to 40,000 scientists and
bers represents only one segment trogen in southern soils, approxi¬
engineers will be required for this
of the large and important chem¬
mately 80%
of all agricultural enterprise. Looking into the more
ical industry, which is rapidly be¬ ammonia is consumed in this area. distant
future, it has been pre¬
coming a southern industry. More If technological development had dicted that the energy produced

portion
-of
the
country's
textile requirements. This amalga¬

in such

continuous

search

is

Virginia,

launched

energy

assurance

Ridge

before
area.

Recent announcements

on

representatives

the

United*

the

highlight the fact that the South*

September,

'

atomic

in

most

tercepted

the part of lead¬
government
and
industrial

ing

during World War II. The oper¬
ating facilities include one of the
largest

Conference

This interest

sponsible for a variety of mush¬
rooming enterprises important to
all of the states in the region.
Over 100 firms in the South today
are
participating in nuclear de¬
velopment programs.
The

West

Ga.

re¬

Calif., illus¬

and add to the home

traded in
sion

ma¬

jor

1957,

playing a major role in
developments. Nu¬
installations in the region
already involve an investment of

more

Springs,

and expanded at their

the

in

targets

southern

September, 1956, meeting at White

atomic

to

was

isotopes, while the Oak Ridge In- components
are
finding : wide¬
stitute ;of Nuclear. Studies assists',
spread-'use in practically every
universities, in. developing strong phase of manufacturing, commu¬
plastic materials for construction
graduate and 'research programs nication, and transportation.
purposes.
The central portion of
in the nuclear industry. The total
the house is
a
ten-foot
On a national scale, sales and
square
investment at Oak Ridge is in ex¬
structure
revenues this year will amount to
containing all of the
cess
of $l1/4 billion, employment
utility
lines.
The
rooms
are
$11 billion. It is expected that this
is about 22,000, and the annual
will increase
U-shaped plastic sections which
to $16 billion by
payroll is around $170 million.
can
be
clamped to the center
1960, and to $22 billion by 1965.
Another AEC facility having a These estimates
column some five feet from the
indicate that elec¬
ground.
A young couple estab¬ profound effect upon the economy tronics is the world's fastest grow¬
ture

trates the trend toward the

dry, the production of rayon is family grows in size. When the
predominantly a southern indus¬ children grow up and leave home,
try.
Approximately 70% of the the spare rooms then can be
nation's rayon production capac¬
ity is in the South, 19 plants in
eight southern states, and new
plant installations will increase

is

■

clear

one-third

This is

Pole

States could be identified and in¬

adopted by the Southern
Governors' Conference at
their

Energy

enter the

we

plan

atomic energy

petrochemicals produced
the

As

of

value of nearly $4 billion today.

in

Atomic

studies

conversion

Cyanamid's Creslan plant at Pen¬
sacola, Fla.; Dow's Zefran plant
near
Jamestown, Va.; and Du
Pont's Dacron plant at Old Hick¬
ory, Tenn.
lishing
Like

war.

petroleum and natural gas through
the medium of petrochemicals.
o

It

some

Among the important new syn¬
thetic fiber plants in the South are

Synthetic fibers, plastics, syn¬ ings came a comprehensive
plan
rubber, and ammonia are for the development of atomic
only a few of the more than 5,000 energy for civilian uses on a re¬
different
products derived from gional basis in the South.
This
thetic

29

field, Rocket aod

fight.
Another key
Force

facility is the Air
Development

Engineering

Center at Tullahoma, Tenn.

Many

experts believe that this labora¬
tory will eventually supplant

Continued

on page

26

26

The Commercial and Financial Chronicle

(623,

Continued

from

page

th^n doubling the nation's annual growth has promoted further conaluminum production struction, and the region is now
since 1950. Production is now at involved in a cycle of industrial
expansion that feeds on itself with
the rate of five billion pounds.
' : ^
V
Announced expansion plans of growing vigor.
The
South's share of the expresent and prospective producers
will add
a
total of lVz
billion pected population growth during

25

primary

Southern Industrial Growth
And the Textile

Industry

pounds of
few

Wright

Field, historic center of ($7 billion, 35%
Air Force development work, in and textiles ($7
many fields of activity.
the nation).

of the

nation),

billion, 52%

of

The first major aeronautical research

Food processing industries in
the area have progressed so rapidly in recent years as to Become
a major factor in the agricultural
there and industrial economy of the re-

facility in the country was
the laboratory of the National Advisory Committee for Aeronautics
at

Langiey Field, Va. It

was

that John Stack and his associates

gion. With the average American
using 1,600 pounds of food a year,
abled American aircraft to crack production must be steadily inmade
thfe

the

sound

discoveries

which

en-

barrier.

to

creased

take

care

of

the

1955

years,

the

capacity Within a
46% increase over

new
a

of

capacity.

The

industry

aluminum

the

coming

each

person

Thursday, August 14, 1958

.

expansion

of

the

large

power-

consuming industries, such as the
manufacture

of

the

non-ferrous

-

metals^Ms been in-the South. The ;
production of aluminum, magne-'\:

sium,

and

in the

titanium

area

undoubtedly will:: increase at an
accelerated rate,
The prominent place given to
the production of power from

each

uses

>

J

ap-

.

is very

years

large.* V*

prominent role

accelerated pace. Many economists believe that within the next
decade

Allegheny

southern

states

,will

in per

to the national, average
capita income. This Would

mean

an

come

near

,

the

up

increase

annual income

in

in

^

this, develop-

jment/also. This could have

an

ex-

,.

for

There is every reason tp.believe
that the construction of plants for
consumer
items will continue at

kansas, Louisiana, and Texas. And
these six states have practically
all of the country's alumina-pro¬
ducing plants. The main reason
for this concentration of the in¬

,

As

century

a

or an average

persons

,

producing
plants
in
Alabama,
North
Carolina, Tennessee, Ar¬

,

people,

.

atomic
energy • by
the
private
proximately 18 tons of material power companies and government *
each year, the markets/available 'groups in the area is a clear indi- ;
for industry in the SoutB in the cation that the South will play a

is

largely concentrated in the South.
There are a total of nine primary

.

quarter of

million

one

state.

dustry in the South are the ac¬
Ballistics panding economy of the country. cessibility of the three essential
Cumberland, Md., The southern food processing m- elements required in the produc¬
wbidhis operated by Hercules for dustry consists of 11,800 plants tion of aluminum, namely, low
the Navy, booster rockets for the and 464,000
employees, with a cost fuel and power, skilled labor,
Nike and Terrier guided aircraft payroll of $2 billion,
and bauxite, the basic raw mate¬
missiles have been developed, as
Reflecting the relatively large rial from which aluminum is
well as tor the Honest John free- size
of
individual
installations, made.
:. ■
'
fight iground-to-ground artillery and the extent to which automatic
In addition to possessing do¬
rocket. This base also is involved processing and control procedures mestic supplies of bauxite, the
At

Laboratory

present

is 16 million

.

a very

j

profound effect upon the further
growth of industry in the area,
(7) Finances:'. The
South
is
making rapid strides in strength-

-

ening* its f i n a n c ia 1 structure.
Southern banks now have 20% of

:
»

the banking assets of the country,

jper. capita and southern life and insurance

of $400.

,

companies have 26% of the total ;

(3) Materials: Materials 'comprise the third item in the triumj

virate of

value, of all outstanding policies J
in the country. A recent survey important factors dictat- listed 18 southern banks among ,

ing the location of industry.;
; the nation's top 100 institutions.
As the South provides 35% of
This marked growth in the fi- *.
the-oil and coal aluminum industry depends for the agricultural products of the naneial resources of the
region is
satellite program.
industry comprises 400 plants em- a major portion of its require¬ nation, it is significant that-one- both a cause, and a .result, of the •
An important missile develop- ploying 90,000
persons, with a ments on imported ore from the half of all new plants located in
expanding economy of the region. ;
metttTerfter is operated by Sperry payroll of $1% billion.
islands of Jamaica and Haiti and the South last
year were related ;"
(8) Miscellaneous: The South *
Farragut
Company
at
Bristol,
northern
coast
of
South in some
The pine tree is the source of the
way to agricultural- ac- ~js an outstanding region in which ~
Tennessee.
The
Navy has
an the basic raw materials for one America, particularly British and tivities. The Souths most
amporin

project

Vanguard,

the

earth

employed,

are

,

WW-acre rocket station at Camden, Arkansas, while at McGregor
Texas. Phiilips Petroleum is said
to he developing the most power-

,o£
the

the

oldest, as well

most

as

southern

recent

one of
indus-

Dutch

Guiana.

Ore, movements

from these countries travel

rela¬

a

to live

tant

manufacturing

operatjon is
food processing,
andf^25%^ ,toLrthe.
plants operahng in
thisv4^W^are^
in this area. The
South,;l^s^2,% af
J5% of its tobacco
^ ^ textile mills, gnd
88%
^

and

do business.

The cli-

mate, recreational facilities, living 1
conditions, and the desire of the '
people to improve their economic ~
well-being'; have been powerful
influences in the location of in-

tively short water distance to the
Gulf ports of Mobile, New Or¬
fal£°h£ rocket fueTever made.
materials for the naval stores in- leans, and Corpus Christi. Thus, in
3e
Pc}h}7 f?.r the study dUstry> while cellulose derived terms of its raw material require¬
manufacturing dustry |n the area.
•
of the effect of climatic conditions
from pine is used in making rayon ments from domestic and foreign operations.
;
The solid support given by the
on turn-aft is located at Eglin Air
puip Krait paper and neWsprint. sources, the aluminum industry
The South has 33% nf>the:forForce Base near Pensacola, Florpress to
industrial development,
The South-s pioneering scientist, has its roots deep in the South.
ests .of the country, 32
while -the Kelley Air Force
The rapidly expanding use of
^ oif the the activities of more than 1,500 [
Dr ,charles Herty, made revolulumber industry, and 25%. of the
Base in Texas and the Navy's air
local, state and regional organizationary contributions to both in- aluminum in many important in¬
base at Pensacola, are the centers
PJper industry. ■
tions devoted to the economic ad- :
dustries.
The Herty cup which dustries has been responsible for pUi?. a
of pioneering aero-medical mvesii
5
accounts - for *56;/o of vanceme'nt of the area, and the v.
he deVeloped for collecting gum its phenomenal growth. Thus, in
tigatums. Scientists at these loca- TOsin
™,nfa^s *
m progress of industrial science in '
stopped the wasteful prac- the automotive industry where the the °tt
United States, and approxitiong are hard at work studying
the area have been major factors
£jce of cutting boxes in the tree average use of aluminum 10 years
mately three-fourths of all petro- in the
the problem of transporting hurapid economic gains scored
to deceive this product.
As the ago was less than 10 pounds per leum and natural
gas production.
man
beings through piterplane- latter practice ufually killed the car, one of the latest models uses
by the
south
during the past :
It produces 25% of the nation's
tary apace.
c{ecade
^^
197 f pounds
tree in a short period of time, the
per
car,
including coal.
The importance of petro'
Supplementing the work of Fed- almost universai adoption of the gold-anodized aluminum grilles.
leum, natural gas, and coal as raw > The Future of Industry in the
era! research groups and private
H<?rty cu
placed the naval stores And certain authorities are pre¬
industry are a number of alert
South
%n a sustained yield dicting that within the next 10 materials for the chemical, indusand
aggressive
educational -and basis. His
lnnic^e^^^
These resources are sufficient*"
pioneering research to years the average use of alumi¬ over
5,000 chemical products are to
support an industrial expansionJ^^^ch^tnrtitutions throughout determine the type of pine suit- num per car will be 1,000 pounds, obtained from them. ;
the South. The Applied Physics
which could make the South the
abje £or the production of news- which would amount to approxi¬
Laboratory at Johns Hopkins UmMany agricultural products are m0st prosperous region in the
t led to the disCovery that mately eight billion pounds per
important raw materials
veraty developed the pioneering £he use of
year. If this should come to pass,
-for^ in- country within the next decade. !
young trees
dustrial operations, and
Aerobee rocket, as well as workexpanding But wishful thinking will not '
produce newsprint of excellent it would have an enormous effect demands
for this purpose have
mg closely with the military serymahe this come to pass. To make upon the economy of the South.
He completed his epoehchanged the pattern of production these dreams come
And the well established indus¬
true, even to
making discovery by developing
of many southern crops. - As an
missile and studying conditions
a modest degree, it will be neces- '
_in .satisfactory methods for bleaching tries also are doing very well. In
the upper
example,
the
development - of
In addi- the pulp. The southern newsprint the past 10 years, steelmaking edible fats from cottonseed oil sary t0 use to the fullest possible
extent the talents of the scientist ;
1
the new industry rests firmly and securely capacity in the South has been
Taios-surface-to-a lr guided misincreased by 70%, which is twice
on j,js work, and the great stands
SjC?an^e
status of cotton- an(j the engineer, as well as )~
seed from an
the national average. Dixie's in¬
unwanted^by>prod- the organizational and managerial
^ v. ri™.
.•
of pine dotting the southern landuct to that of an important
agr1-; :ahilities of the manufacturer and
1
j
A l
a
scape are his enduring monument. dustry is in an expansion mood cultural
in Alexandria, Virginia, -has-been
the production of forestry prod- all along the line.
comrrmdity.^. In; >certain entrepreneur. The mere possessections of the South today; cotton
pm-ticularly
sion of abundant raw materials,
active^ in ^udying uctSj
those based on
solid pt-o peill ant.rockets,-the the utilization of
Factors Responsible for Industrial is raised primarily for-the pro¬ a good climate, and good soil is
pine, is increasduction of seed instead of fiber.
Georgia Institute -of Technology
Expansion
no guarantee of future prosperity.
ing at a rapid rate. There are 80
Fisheries also provide raw. mahas Song -operated an aeronautical
The three major factors respon¬
The
capabilities, ambitions, and
pulp and paper mills in the South
ton
I
nrJn
2
terials for many industries.
department _with wind tunnel resible for the rapid industrializa¬
industfiousness of the people oc¬
today, and this number is growing
search
facilities, and at North
tion of the South are the Three
(4) Water: The nation's great- cupying the area are the deciding
rapidiy. Many economists are of
Carolina State College studies are
the opinion that the discovery of M's—Men, Markets, and Materials. est undeveloped water resources factors."
being made -of
rocket
control the sulfate
(1) Men: The most important ar?
process
for making
South. The ^average
An interesting parallel is often
problems.
Kraft and newsprint from slash single factor in the industrial de¬
-1S u
GOm?are
drawn between Panama, which is :
The impact -of these develop¬
pine triggered the industrializa¬ velopment of the South has been
inS
s
e cauntry a® heavily endowed with excellent
ments upon small business enter¬
In addition
tion of the region. These 80 mills the character and ability of the a whole.
the+South
but has one of the low- I
is using only 4%
prises in the South has been treof its "water re- egt standards of
supply 40% of all the paper sold people in the area. Due to the
living in the,
mendous.
Lockheed's
Marietta
in this country, and the South is rapid mechanization of its agri¬ sources, while the average for the
world> and SwitzerlandTwhich is
cultural operations, the South is nation is ib/o.
Plf^'TihlTt
mS well on its way to become the
very poorly supplied with natural t
(5) Transportation: The South resources, yet enjoys one of the
Sfc paper-making center of the world. still a labor exporting area. This
Ron worth of bus iness with
Southern newsprint production large reservoir of willing work¬ has over one-half of the country's
highest standards of living of any »
Georgia firms, and a total for the has now reached
500,000 tons per ers, who can be readily trained to salt water coastline and 60% of country.
Southeastern states of $77 million.
year, and it is expected that this handle a wide variety of complex the nation's navigable inland waThe .fundamental reason
why
R made purchases from 7,500 ^dif¬
will increase to 1% million tons manufacturing
operations, is a terways. In addition, it has-36% petroleum,
natural
gas,
brine,ferent firms in a recent three-year
by 1975. The South now produces prime attraction for industry. of the combined road, railroad, minerals, and other natural reperiod.
more than half of the wood pulp
Equally important is the fact that and airway mileage of'flie country, sources, of the South, which have;
With-a favorable climate, ample
have
manufactured in the country and Southerners
demonstrated
Ten southern ports Vank among been available since the earliest;
space for plant "dispersion, a
is the largest producer of chemical their ability to design, build, and the top 25 in the nation im annual
times, have suddenly become the :
wood pulp in the world. Approxi- operate a wide variety of indus¬ tonnage. Houston is the tmfd port
basis for a great industrial empire, >
trial plants in an eminently satis¬ in the nation, while New Oflfeans
SArfS, ^
•
mately nine million tons of wood
expanding employment, and a ris- "
factory manner.
:
Many surveys ranks fourth.
/ing economy is
due, in large:
Wrtot
of
pUlp' valued at nearly $2 billion, have shown that southern
are Produced each year. The total
plants
(6) Utilities: The South is a measure, to the vision and skill
in many industries operate at bet¬
land of low energy costs'fdue to of the scientist and engineer. Until
-missile industry.
ucts exceeds the total value of the ter
efficiencies, and at higher h
y d"T o e 1 e c t r i c power and an the vision of the scientist can see'
Which was born in the South,
cotton and cottonseed crop. Pine quality and profit levels,
than abundant
supply of coal, oil/ and in them an answer to a human ,
promises to find its most fertile tree farms
will
produce
2,000 comparable installations in other gas.
During the' period^'ifrpm 194.6. need, and the engineer supplies
soil for "development and expan¬
pounds of cellulose per acre annu- sections of the country.
to 1954, the private electric utili- the technological skill which en- >
sion in the area.
ally, equivalent to four bales of
(2) Markets:
The
sharp
in¬ ties in the South led the nation ables them to be used, they really
tries.

Rosin

and

turpentine obthe starting

talned from pine are

....

.

o

.

^

.

.

indu£try

_

Jwould

^uality.

.tfarfififchfo

22?'

atmosphere.
yas *<i®vnit>ped

Research Corporation

,

-

particularly

"

,

.

,

IJr

.

G

c?

tAY*

m nnxr

i

crn An

.

_

.

.

_

_

,.

resourJes?

teeeJearLr°f
«

„

„

„

^

.

—-

.

.

Se

Sd

thi yexnnected

Aviation! value of

Other Industries

The fbod manufacturing

indus-1
tJqy is the most important ($11[
hHlion, "24% -of the nation) indus¬
try in the South today, followed!
by Chemicals l$8 billion, 39% of I
the nation), oil and coal products.!




southem £orestry Prod*

cotton.

crease

in

per

capita

income

in

Among the rapidly growing in- the South in recent years—250%
iustries in the area are the light since
1939, 64% above the na¬
netals industries, of which the tional
average—-has stimulated the
production

of

aluminum

is

the

expansion

construction of plants for the pro¬
duction of consumer items to sup¬

•program begun during the Korean
War was completed in
1955, more

ply the expanding needs of the
people of the area. This economic

lost

important.

The

in the expansion of

facilities, the do not exist at all as far as ecoexpansion in Texas alone being; nomic value is concerned. Man'sgreater than in all of "the New knowledge and understanding of England states. Today, "electrical scientific and engineering princi-power resources

resent

more

tion's total.

in the South rep-

than 30%

of;the"

na-

TV".

It is significant that the

greatest

pies, coupled with vision, leader-,
ship, and the availability of in-»
vestment capital, has resulted in
the industrial development which

Volume 188

Number 5768

.

The Commercial and Financial Chronicle

.

.

is

so

of

the

rapidly

changing

face" supplying the most indispensable

the

South.

While there

are

factors

limiting

by several southern states, and

mary

the

comprises
of

resource

the

the

measures^ are being taken to
increase the-output of technical

An

as

undertaking^^/.'./=/.'.>

application of technology1 has

indqstry, and

will be solved, and that the

mechanized,, and

80% of all of
plants in the
country are located in this area.
Over, $4 billion worth of petro¬

within the next few years, will be

the

."I

has ^permitted

people to work less and

certain

am

that

this

The average output
per man-hour
the economy as a whole is

to permit-the

six

times

that

of

century

a

Technology is opening

ago.

the

center

region to expand to-

i

of

-

n

dust

r

in the

y

in

complished,
will

for

be

has

been

continuing

new,

at

energy

re¬

sources

an

satisfy the world's

quirements

of

at

the

are

southern

manufactured

are

from

them.

In

addition, petroleum and natural
gas supplies 55%
of the energy
;

Childs Securities

ac¬

end, for the ocean
enough heavy hydrogen

contains
to

this

our

energy re¬
least a billion

Corp. Is Formed
An important new investmentbanking firm has been formed un¬

the

der

an¬

by its parent
corporation, C.

Technology thus points

the way
continuation of the expansion
of industry in the South
by insur¬
a

the

production

of

variety

products.

long as pine and sea water
available, southern industry

F.

and

"The

.

oldest

in

house

can

of

an

Childs

Compart y,

So

endless

almost

America spec¬

are

;

ializing in
Government
Securities."

look to the future with confidence.

requirements of the nation.

an

nouncement

years.

for

Securities

Childs

name

Corporation, according to

ing a virtually inexhaustible sup¬
ply of energy and raw materials

in

its full capabilities. I predict "fur¬
ther that the South will become

gates

new

When

energy.

to

produced annually
states, and some
5,000 / different
consumer
items

pro¬

for

over

used
by the sun to
never-ending flood of

one

chemicals

South,

graduating, a sufficient number of
the- young people trained in all of the
living. requirements of modern industry

.

the

the?: petrochemical

problem

more,
thus
creating
world's highest standard of
.

material for

engineering graduates. The
of industry in the South leum.
* Petrochemicals
are
the
depends upon the success of this / backbone of the southern chemical

permitted the country to become
highly industrialized and highly

duce:

raw

production of a host of items
required by our economy is petro¬

future

to

generate its

search

important

the

and

pri¬

nation

castor bean.

ac¬

tive

foreseeable limitation of tech¬

This

of this situation i3 recognized

ness

cilities, and manpower—there, is
nology.

required for their op¬
Fortunately, the serious¬

eration.

the four other
major resources of
the nation—natural
resources, ag¬
ricultural capacity, industrial fa¬
no

one group
to the other at will in
making a given product. Thus,
nylon
may
be
produced
from
petroleum, coal, pine lignin, or the

personnel

27

(623)

/

The main of¬

Finally, I would like to empha¬

fice

of

Childs

.

uncovering sources of raw ma-f country within the next 25 years. > ?;cfWhen the last oil well runs
size again that the greatest re¬
dry,
S e cur it i es
terials,* so that -today'sJ nitrogen /1 While ttfre*
majority of this in- : we. can turn to the pine tree, the' source of the South is her people.:
Corporation
for explosives, and fertilizers is
South's most important renewable Pleasant,
courteous, industrious,
dustry :will be-: highly technical in
will be located
obtained from the air, and mag¬
F. Newell Childs
nature, there'will be a corre¬ resource, for the basic raw mate¬ and intelligent, they have made
at -One
Wall
nesium, the new industrial light
sponding" expansion in the pro¬ rials required for the production industry welcome, and by their
Street,
New
metal, comes from sea water.
ductionof *~sub-assemblies
ability they have made southern York, and the home office will be
and of petrochemicals. When an aver¬
The United States has the
high¬ consumer goods. Much of south¬ age tree is converted to lumber industry the best managed, the at 141 West Jackson Boulevard,
est economic growth rate
ern industry
among
today is composed of by present processes, only 65% of best operated, and the most profit¬ Chicago.
Other offices will be
the highly industrialized countries very
large manufacturing units, the tree is obtained as iisefujl able in the nation.
ready to open soon in Boston,
of the world, and it devotes the
which require a constant flow of products. The sawdust, bark, and
Pittsburgh, Cleveland, St. Louis
highest percentage of its national intermediate products for their waste lumber resulting from
and Denver.
income to research and develop¬ successful-operation.
these operations can be
Due to the
readily
Principal officers of the new
ment. "J From this, one may con¬
rapid growth, of this
industry, converted by known processes to
firm
include F.
Newell
Childs,
clude that research may be the much of: the required
parts and a hydrocarbon liquid which can
President (also President of C. F.
most important
single? factor in sub-assemblies must be obtained be used in place of gasoline in in¬
Childs and Company and son of
J.
the economic growth of the counStewart
ternal combustion
from
sources : outside
Baker, Jr., Vice-" its
the
area.
engines, or it
founder), Elwood D. Boynton>
Many thousands of small found¬ can be readily converted into any President of the Chase Manhattan and Donald E.
:try...;-.:cBarnes, Vice-Pres¬
one
of the many industrial and Bank, has been appointed special
Probably no other section illus¬ ries, machine shops, and sub¬
idents.
■>
trates so well the value of re¬
assembly manufacturing units consumer products now obtained gifts chairman of the 1959 finance
A general business in
corporate
search in improving the economic must
from oil and gas. As a ton of wood
campaign
o f
be
built throughout
the
finance, including underwriting of
Greater
well-being; of, a? region'as, the South during the next few years residues can be processed to yield the
corporate stock and bond issues,
York
'South.C. The ^majority of its indus¬ to satisjCy thq-requirements of the 110 gallons of liquid fuel, the pine New
loans to corporations, negotiation try is (ne^^iid'is^ based upoh/re^ automobile,: aircraft, and missile tree may be regarded as an upside Councils, Boy
of mergers and related undertak¬
Scouts
of
cent .technological advances.
down oil well. The great stands
At industries. v;V
.•
;
ings has been mapped for Childs
least 50%, and possibly as much
of pine dotting the southern land¬
America,
In a disconcertingly large num¬
Securities Corporation.
All such
it was an¬
as
75%, of/the 250% increase in ber of cases the South is still
scape are the mainstay of much
pay¬
affairs heretofore handled by C.
of southern
the per capita income in the South
industry today, and nounced by F.
ing two freight bills for consumer
F. Childs and Company are being
the guarantee of its future indus¬
■since 1939 may be directly attrib¬
Raymond
items,, involving the movement of
transferred to the new firm.
f
uted to the application of research
Johnson, gen¬
raw
or
intermediate products to try when our petroleum reserves
"In the business history of this
eral campaign
are exhausted.
to convert southern resources into
the

Boy Scouts Appoints

J. Stewart Baker, Jr.

^

.

■

.

North

products required by our economy.
In.the field of research,-, it is

disconcerting
to. ' find
that
the
South accounts for only 5% of the
industrial research under way in
this

country.

"South

Fortunately,

is well

its

isfy

of

return

the

consumer

requirements. Some

75% of the chemicals required for
the
production of
plastics
are

manufactured

only

needs

the

"of research establishments to sup¬

are

aware

of

the

and the

a

very

,

in

;

the

South, but
proportion of
molding facilities

small

country's
located-:, in

the

same

area.

port its rapidly growing technical
industries, and has been provid¬

Probably no* other manufactur¬
ing enterprise, • offers such out¬

ing such facilities at a rapid rate.
The writer has predicted that at
•least 1,000 new industrial research

will

constructed

be

^in the South in the decade from
1955

to

15,000 sci¬
engineers will be re-

1965, and that

entists

and

•

quired

to

operate

these

This

fa¬

new

'

cilities.'

brings

us

face to face with

the most important problem

fronting the South today

con¬

the

—

scarcity of technical and engineer¬

ing
'of

personnel.
With some 25%
the
country's
industry,
the

South
its

is

graduating only 17%

of

scientists and engineers at the

Bachelor's

.Master's

level,

level,

and

17%
at
14% at

the
the

Ph. D. level.

v

v*

The magnitude of this problem
may be realized by a considera¬
tion of the $3 billion loss incurred

•

'

into liquid fuel, other by-product
processes

placed
tion

undoubtedly
will
be
operation. The utiliza¬
only two-thirds of the

in

of

by the South each year due to its

inability to properly educate its
young
people. A recent survey
shows

that

less

than

half

of

the

high school graduates in the

sufficient
three

molasses

pounds per

give
provide

to

day

for

every

head of cattle in the United States.

area

the

South

sufficient to support

is

water. The

ocean

makeit possible for the area important
locational advantages
have new land forever. And due to its long coastline.
recent
I,
In
advances
the
in
production of energy,
technology
hold forth the promise of a never

I.Q.

of

132

or

finances.

or

have shown that

As

studies

the average col¬

population several times

Avenue.

The
gifts

v

special

almost

impor¬

J. Stewart

Baker, Jr

cent

commit¬

explosion — of
in the last decade,
an

the

and
we look for this
expansion, despite
temporary setbacks such as the re¬
economy

recessiori,

to

continue

even

campaigning for at an expanding rate," stated F.
"Our experience
substantial gifts on Oct. 1.
The Newell Childs.
general campaign will open with representing thousands of institu¬
tee

will

begin

will

ending

supply

lege graduate earns $100,000 more

for

in

of

raw

materials

services."-:

lifetime

a

not had the

than

one

who

has

advantage of such

an

education, the annual loss to the
South

from

this

source

is

$8

billion.

the

production

While it

of goods

and

The basic

was

not to be

southern

care

expected

could

take

Industries will not continue

to expand

in

an

area

incapable of




to

100

years,

the

next

200

the

field

of

into

namely,

(1) agricultural and for¬

two

main

groups,

and (2) minerals.
technologi¬ In the first group are such items
cal needs of industry in the area, Tis
cotton, ^cottonseed, grains, naval
due to its rapid rate of growth,
stores, and wood puip. In the sec¬
they I must be prepared to do so ond group are such items as petro¬
within
a
reasonable
period
of leum, natural gas, coal, bauxite,
time.

be exhausted—oil in the next

materials for the

of the immediate

schools

soon

production of goods of every de¬
scription
may
be
conveniently

raw

estry products,

and Iron

makes

it

ore.

Modern technology

possible

to

move

from

curities business.

and coal within

years.

atomic

And

even

in

there
is only sufficient uranium in sight
to
satisfy the world's
require¬
ments for some 200 years.
But
resent

advances

nuclear field

in

energy,

the

for

present

unlocking
the
energy
in heavy hydrogen by

thermonuclear
solved.

This

Hirshon, Roth & Co., 30 Broad
Street, New York City, members
of the New York Stock Exchange,
on

Sept.

reactions

reaction

is

may

be

similar

1

will admit Marion L.
Wendy J. Hirshon to

Benson

and

limited

partnership.

Riter Co. to Admit
Riter & Co.. 40 Wall Street, New

remaining
proc¬

United

York

City,

members

of the New

York Stock Exchange, on

will
ir\

admit

UrnitoH

Margaret

A.

nortnprshin

States

of

founder

The

Government.
the

late C. F. Childs, was
of

Investment

the

firm,

j

the

co-organizer

Bankers Asso¬

ciation of America, on whose Gov¬
ernmental
Securities
Committee

Childs junior has represented the
firm

thermo¬

problem associated with the

Richard R. Fel-

principal of the firm.

a

Hirshon Roth Partners

indicate that within

the next decade the last

ess

is

ker

technology also is showing the
way.
The conventional fuels will
50

divided

that

the

as

to

•

■

Fifth

is the last unde¬

facilities

•

Saks

ATLANTA, Ga. — Consolidated
large veloped source of a large number
as the present
of important minerals, and in the Investors, Incorporated, has been
one, and the devel¬
formed with offices at 2265 Riada
opment of improved agricultural exploitation of this virtually in¬
Drive, N. W., to engage in a se¬
procedures during the past decade exhaustible supply, the South has

girl of equivalent
ability was unable to
attend college due to inadequate

'

—

-

a

an

intellectual

'

of

of the most

one

tant events is the amazing growth

The production of one ton of wood
investors
in the delicate
the
traditional
Dawn
Patrol tional
pulp results ixi the simultaneous
Breakfast on Jan. 8, 1959.
The Government securities markets,"
production of a ton of lignin, the
Childs continued,
finance campaign of the Greater Mr.
"may be
cementing agent in the tree. This
molded: consumer items.
New
York
Boy Scout Councils useful in helping to provide the
is almost entirely wasted in pres¬
To pick another example, a re¬
will raise the funds to continue capital and credit which Ameri¬
cent .survey has shown that over ent commercial operations, despite
the Scout program for New York can business will need in the years
half of the bolts and nuts used in the fact that it can be converted
.
City's 120,000 Scouts, and bring ahead."
the South are manufactured else¬ readily into chemicals for the pro¬
Formation of Childs Securities
duction of nylon and other im¬ Scouting to more boys.
where. And finally, it is surpris¬
Mr. Baker announced that his Corporation,
according
to
Mr.
ing to note! that while food manu¬ portant consumer items.
co-chairmen on the special gifts Childs, "was made a necessity by
When the last iron ore pit has
facturing, is the South's largest
committee will be James H. Evans, the rapid expansion of the parent
industry, it still falls short of been exhausted and our other Vice-President of
the Reuben H. firm's corporate
securities busi¬
meeting southern requirements mineral resources have been com¬
Donnelley Corporation; J. Emer¬ ness. In corporate bond syndicates
for. prepared foods.
pletely utilized, the production of son
Thors, partner of Kuhn, Loeb alone," he said, "we are now bid¬
/For the.next 25 years, the pres¬ metals and chemicals from sea
and
Company;
and
Keith
M. ding on or negotiating an issue
ent resources of the South, sup¬ water will continue to be a fertile
Urmy,
Vice-President
of
the just about every other day on the
plemented with certain raw mate¬ field for development. The first
Chemical Corn Exchange Bank.
average."
rials from adjacent areas, such as plant for the production of chemi¬
Mr. Baker, a supervisory officer
Known
as
One
of the largest
bauxite from the West Indies and cals from sea water was operated
in the Chase Manhattan metropol¬
privately-owned businesses in the
South America, will be sufficient by the Dow Chemical Company at
itan department, is a member of
world
in
dollars-volume
trans¬
to take care of the needs of indus¬ Kure Beach, N. C., before the war.
the executive board of the Greater
acted, C. F. Childs and Company
is
try. Developments in agriculture Dow
presently
operating
a New York
Councils, Boy Scouts handles
multi-billion
dollar
will provide' all of the foodstuffs large plant for the production of
of America, and a trustee of St.
amounts
each
month
in
sales
required fOr the expected increase magnesium and bromine from sea
Luke's Hospital and the Groilev
through its own account.
The
in population.
water at Freeport, Tex., and these
Foundation.
company is noted also for having
Looking into the more distant are only two of the two dozen
devised and opened much of the
future, the picture is still bright. metals and chemicals which occur
modern market for securities of
The food producing potential of in commercial quantities in sea
Form Cons. Investors

another boy

'

century,

and

E xecutive

available mill residues would

(the Ph. D.
level), finish college. This means
that for each of the 80,000 college
graduates in the South last year,
with

,

chairman

Vice-President

standing opportunities to southern
businessmen as the production of

; laboratories

•

Before wood waste is converted

finished goods to the South to sat¬

for

neered

He pio¬
trading in
securities by main*

many

years.

coast-to-coast

Government

trans-continental
direct
then lend¬
ing use of the wires to major
Western brokerage houses.
An¬
other colorful practice early in
the century enabled the firm to
accommodate
banks
throughout
the nation in establishing circula¬
tairiing

wires for this purpose;

tion accounts,

whereby their own

was

printed and circu¬

currency

lated, secured by a deposit of Gov¬
ernment
bonds
in
Washington.

Aug. 21
Many old-time bank officials will
C. Riter remember the firm in this con-

.

Financial Chronicle

The Commercial and

28

long-term borrowing the fact
borrowings will also rise, and

with
term

We See It

As

and business must

"If

be very, very careful about this whole

the

matter of inflation. In this
space last week we asserted—and now repeat—that gov¬
ernment anti-recession programs generally "are the very
programs which all through the years, and even the cen¬
turies preceding World War II have been regarded—and
justly so—as being precisely those which are best calcu¬
lated to produce long continued stubborn price rises and
all the accompanying evils of what is known as inflation."
/
The President has a greater responsibility in this
sibility of government in this

increasing deficits.

prospects are for this next one, which

goodness knows, horrible as it is, must be highest one,
and we must go back from there."
■
r

The President is not noted for the

,

of his impromptu

makes it

doubly clear that he does not believe
that there is any health in a long series of almost astro¬
nomical deficits, although the best he can say at the
moment is that the supposedly $12 billion deficit
facing
us must be the
largest and from then on we must work
back toward at least an approach to fiscal
sobriety.
now

Is It

But is this

Enough?

enough? Possibly it is

as

much

as

could be

expected of a Chief Executive who, along with all too
of us, has been living in an atmosphere of New

many

Dealism. until the solid precepts
no

to

of sound economics

are

longer given much thought or respect. But is it enough
protect the wage earners and the rest of us from the

evils the President himself describes—and from others he
does not mention?

The fact is that when
words to the

we

turn from the

recent record of either the

President's

Administration

of

Congress, the conclusion is that any and all efforts
being made or proposed for the prevention of in¬
flation are lame and impotent. The cold truth is there is
no sound reason for the
$12 billion deficit either now or
at
any other moment in peacetime. The expenditures
which are in part responsible for such a
deficiency are far

or

now

greater than there is any sound

reason

for.

It may

may not be true that we must spend the sums now
on defense in this troubled world—on that score

or

planned
we

pass

no

judgment at this time—but the billions spent to get
country are just
so
much money down the drain so far as
economically
sound management of our affairs is concerned.
to hold the votes of the farmers of the

Nor

is

,there any sound reason why the taxpayers
required to put up the billions of Federal money
that are now going into
housing. We have played fast and
loose with Veterans' benefits, and with a half-dozen other
involving huge

sums.

It should

done—and if the President is in

no

never

have been

position to tell the

country the facts in these matters, then it is because either
he or we (or both) have lost our heads.
The

borrowings of the Treasury as a result of this
deficit will be
inflationary enough. In a recently issued
analysis of the situation, the well-known government bond
specialists, Aubrey G. Langston & Co., New York City,
had this to say.* "The bulk of the
Treasury's deficit financ¬
ing will have to be lodged with commercial banks and
such debt-lengthening efforts as the
Treasury can under¬
take successfully, over the indefinite
future, will be con¬
fined to those that
banks

unless

a

can

new

accomplished with commercial
approach to debt funding and debt

lengthening is used.
"Incidentally, we
First National

be

Gold Today
Why do we buy gold at all? Is
because some still believe the

were

interested to note that The




together, are responsible
overwhelming proportion
of total world production. Rating
which,

for

an

South Africa's
utor

the

to

role

as

cause

is

throughout history has been but
the hoard of the very few rich.

al¬

For instance: The
Pound sterling was one pound of
silver .925 fine. The French word
for money always was, and still is,
Argent - Silver.
The
Spaniards
have two words for money, in
ways-silver.

Spain it is Dincro, a word unre¬
lated
to
gold, while in LatinAmerica it is Plata, Spanish for

and

the free world,

sums

free world Russia is

a

later.

year

The

conse¬

quent demonetization of silver, by

destroying

equivalence

gold

the

bimetallism

which

had

created,

reduced the metallic reserves re¬

quired

the

by

which is

phenomenal

credit

of

system

universal and whose

now

growth

continues to

be speeded by the development of
communications
and
transport.
As

result, gold today constitutes

a

but

the

pin-point of
pyramid of currency
its

and

inverted
and credit

an

usefulness has
dissolved despite all attempts to
monetary

payer's

unsuspected by our

item appears

authorities,
whatsoever

no
sign sof it
be traced to our

for
can

That item is the "For¬

Treasury.

Aid"

to Russia:

extend

we

the

of the

terms

Interna¬

Harry
the
country he betrayed, the Treasury
is obligated to buy gold at $35
per
fine
ounce
regardless
of
origin. Russia is far too intelli¬
gently managed to look upon gold
as anything but a commodity. She
publishes no figures of her gold
production or consumption. She
is known to be the second, if not
the first, largest gold producing
nation, while through slave labor,
she certainly is the lowest cost
producer. We know the extent of
her gold exports to free nations
tional

White's

Dexter

but

she

amounts
and

Fund,

Monetary

is

disastrous

as

senseless.

we've gone

to the Gold Exchange
Standard, then the Gold Bullion
Standard,
finally
the
Interna¬
tional Monetary Fund, an utter
failure recently turned into an¬
other lending agency—as though
we
needed still another lending
One has but to glance in

agency!

what the In¬
ternational Monetary Fund face¬
tiously calls the "Official" rates
of
exchange
followed
by
the
"Free
Currency
Rates"
which,
though often called "Black Mar¬
any

newspaper

actually represents a
picture of real exchange

truer

values.

Not

pegged

rates

vent

Fund,
army

who

so

the

"Official"

which

can.

all

The

or

circum¬

sooner

we

the International Monetary
and

of

rid

ourselves

bureaucrats

enforce its
we

at

Rates"

ket

of

needed

regulations, the

cordingly.

.

.

.

.

the
to

sooner

shall face realities and act
,

„.

is

Wants Gold in Free Market

in the free market. In¬
worrying about our re?
losses of gold "reserves" we

belongs
stead
cent

of

should

this

encourage

and let any

movement

nation willing to pay

commodity.
then buy

ac¬

Our Trfea'Ssell gold only
it suits our in¬
or

to

goes

hoarders

every¬

problematical. Suffice to
say
that, without Uncle Sam's
minimum price guarantee, hoard¬
ing will assume a different ■ out¬
look.
Today, it is expensive/in
that it entails the paralysation of
the capital involved plus the cost
of storage;- if to these is added
the
speculative risk, heretofore
unexisting, of a lack of minimum
price guarantee, we may well see
gold selling below its cost of pro¬
duction.
'
1
.

throws
she

legacy

no

uses

to

light on the
economic

for

political penetration in many
Her success in penetration
suggest that gold in no

Rates

is

It

time

monetary

day conditions, decid¬
ing whether balance
or
fixity
bring about true stability. We do
welcome
the
balance
resulting
from

supply and demand in our
commodity and security markets;

why, then, not extend this sound
principle to
which

is

to

open

that

States; she ships it to Eng¬

land, to Switzerland, and to other
countries
which, in turn, affix
their own seals on the yellow bars
which then become acceptable to
our

Treasury.

That

is

how

we

gold
regardless of origin.
That
is
how, through our $35
buy

price guarantee, we give "Foreign
Aid" to Russia and then bewail
the

disastrous

economy

impact

on

our

of Russia's growing in¬

The scantiness of the stocks

of

gold in monetary use has been the
basis for loud and repeated de¬
mands for

an

anteed fixed
States.

The

advance in its guar¬

price by the United
favored
argument,

emanating principally from the
gold producers, is that the price
of gold should be "adjusted" to
the price level of other commod¬
ities. Disregarded is the fact that
the prices of commodities are de¬
termined

countries

other

of

by supply and demand
while the price of gold is arbi¬
trarily and uneconomically fixed.

disre¬

in

subsidies and controls of
kind.

quotas,
every

Another

which

problem

re¬

quires solution is that of our lack
of control
S.

to

over

the circulation of

For

serve as

these

created

were

media of exchange for

people of the United

States,

the tools of alien hoarders

as

and tax evaders
as

outside our

notes

currency

nor,

least of all,
promotion

instruments for the

of the trade of the enemies of our

Neither Russia's

country.
nor

have

the
in addi¬
Russia's gold, they make

any

Communist

tion
use

to

of

Ruble

China's ""People's Yuan"

Red

our

Zurich

and

market -outside

orbit hence,
notes.

In

other

the

free

Paris,

markets

the greatest demand for our

originates

notes

Russian

from

Chinese agents,

ternational trade.

our

bring
balance
in
international
payments positions permitting us
in time to do away with tariffs,

the

United

of

we

gard of wage and cost differen¬
tials?
Free exchanges alone can

not

them open. Russia
ship gold directly to the

commerce

fraction

a

Or shall

continue,
through pegged exchange rates,
to readjust our own price level to

U.

used

foreign

our

but

total trade.

borders.

is

.adapted
our
exchange policies

we

and

to present

would

volume

,

Prefers Free to Fixed Exchange

does not

Standard

Coin

Gold

it

as

'

Like all other commodities gold

doors and keep

Deplores I. M. F.
the

threat to its

Hence to
promote her inroads inta the free
nations

lands.

mean

restore it.

From

a

and well-being.

peace

,

item, invisible to the tax¬
naked eye, which adds
heavily to his burden. Despite its
obviousness the existence of this

unlisted

eign

1872, the Latin Union and the
United States joined the move¬

upon

penditures listed in the Federal
Budget
constitute
the
largest
item of all.
But there exists an

Under

in

taxpayers are

we

to contribute; vast
for armament. Defense ex¬

called

gold standard has had but
a
very
short life.
England re¬
nounced
B i-M e t a 11 i s m
and

adopted the Single Gold Standard
in 1816.
Germany followed suit

to

most

a

silver.
The

U.S.S.R.

angle of ap¬

the problem of gold,
important one.
Be¬
of the Communist threat to

not supported by
the facts for, with the exception
of less
than one century, gold

ment

econ¬

omy,
we
find that this small
country's chief exports, gold and
diamonds, are strictly non-essen¬
tials. The case of Russia is totally
different.
Sworn enemy of the

balance

another

is

There

proach

The money of the massps was

contrib¬

a

general world

where is

Provides Foreign Aid to

myth that ''Gold has been money
time
immemorial?"
This,

from

course,

Au¬

when, if and as
terests, not otherwise; Only 30%
of world gold production goes to
industry; what proportion of the

Continued from first page

of

Peru,

But the real gains would

to Russia and to South Africa

go

useless

scrap

City Bank seems to have come to about
the same conclusion, based on the
July edition of its
Monthly Letter. After pointing out that the Federal deficit
was 'swelling beyond $10 billion a year,' it added 'what¬

Mexico,

Canada,

stralia.

ury can

it

were

we

for it have our share of this near

realizes.

matter than he

shduld be

programs

of

this country blossoms into a sort

business activity in

prosperity that would fully utilize available manpower as
early as the end of the calendar year 1959."
But Federal finances are but a part of the respon¬

"Now, government's principal reason here is to keep
try to keep, so far as we can,
fiscal responsibility, and I do not admit, and I do n6t for
a moment believe, that we are going to have constantly

He

fiscal

for

one

down expenses so we can

facility and clarity
analyses, but it is clear enough from
these somewhat awkward sentences, that he is aware of
the awful effects of a constantly risingJeveLof prices, and
in particular of the cruel consequences of them to those
who are depending upon pensions and the like to carry
them through their aging years. He recalls at one point
that months ago when many were screaming about the
alleged need for all sorts of foolish measure to end the
recession, he was even then warning about the dangers
and
the harmfulness
of inflation and insisting upon
avoidance of at least some of the more dangerous of the
anti-depression programs then being proposed.

for a series of large deficits, not just
1959. This statement holds true even if

continues—we are in

one

"I believe the

postscript to The First National

this: The probabilities favor
spending for a number of
years and, if the rise that has been going on in nondefense spending since the end of the fiscal year 1954

day the American consumer is going to
rebel, he is going to rebel in a big way, and there will be
real trouble, and we will get something that we don't want.
high,

remains that shorteralmost certainly to a

as

to add a

were

that

enough to yield to this
propaganda, who would profit by
our action?
To a very small ex¬
tent the marginal producers such

City Bank Letter it would be
a
continuing rise in defense

public. Because if they do, just as sure as you are a

foot

we

assuming

senseless

larger extent.'

much

problem of pushing wages each year above those rates
that imply or show the increases in productivity, and busi¬
ness must make its profits of such a scale that where they
can still continue to invest money they
are not robbing

or

Thursday, August 14, 1958

.

But,

is able to cover

fraction of this amount the Treasury

ever

Continued from first page

'

.

.

(624)

and

and this demand

is far greater than generally real¬
ized.
Self - protection
demands
that

we

our

dollar

recognize the power of
and so- regulate its

movements
interests

of

as

to

our

serve

best

the

country.

An absurd belief is

gaining

cur¬

namely, that
Russia's large and growing gold
production may result
in her
establishing
a
gold
convertible
Ruble thus threatening the West's
preponderence as the world's fi¬
rency

among many,

nancial

exists

centers.' In

no

Russia

there

banking system outside

Number 5768

Volume 188

State's

the

Moscow is very far from

Her

institution.

own

ing

Ruble

the

manipulation of

past

The Commercial and Financial Chronicle

...

—isVnot

likely

in

dence

instill

to

Ruble

the

in

Bill

Ruble

a

inter¬

of

likely to be accepted by any but

End to

bondage.

Russian

in

held

those

has

gold

Most

nothing

at

with the value

do

That value is deter¬

dollar.

our

a year

finance

to

steel

much

New

York

reports

rates

from

as

the

last

1957

as

"The

of

effect

of

changes for all the

facturing

companies

28%

second

from the

which
in

last year ex¬
increases by, two to

the

ceeded

^
&
Treasury bills by the Central Banks to offset the
purchases of the refunding obligations has increased the
yield on
the most liquid Government obligation. The
uptrend in the return
on short-term Governments
brought with it an increase in bankers

these
manu¬

acceptance and commercial

Fixed Income

In

other

came

from

drives,

four.

still

sales

first

half

year,

com¬

in

bined net income of $4,465 million

30% under

was

the

year,
with
decreases
dominating two to one.

"In

592

income

of

second

quarter

from

a

year

same

as

companies

pre¬

that

in the

the first quarter of

Industry

show

totals

such

rise

demand

not

off

drop

for

quarter,

able to better their net

were

ings—as

a

result of

in

the

income

retained

to

companies
have
con¬
pay
regular dividends
even though not
earned, or earned
by only small margins, in hopes

the

to

business

pickup will war¬
maintaining the same rates.
If this recovery should not occur,
a

rant

earn¬

plant and

new

from

"Some

companies

some

corporate

finance growth.

quarter
over

With

substantially

tinued
second

'56, and 8% in

over

'55.

that

further

dividend

cuts

would

be

equipment bringing about a low¬
expected. The leveling off in the
ering of production costs, or else
earnings decline in the second
through programs by management
quarter, together with the upturn
to reduce operating and overhead
in key business indicators, should
expenses. A minority of companies
tend to encourage concerns which
were
able, through bigger sales
can afford to do so to avoid dis¬
or lower costs, to
achieve second
turbing regular rates pending fur¬
quarter earnings exceeding even
ther clarification of the outlook."
those of a year ago—in contrast

in

both comparisons.

"Exceptions to the general pat¬
tern of gains over the first quar¬

with

ter include the

trend.

which

first

the

last year, the maintenance of the
flow of dividends indicates a sharp

building mate¬

increase

did

lirs^t

im¬

gains

the
as

where

"Even

cement-glass-stone, steel, electri¬
cal
equipment,
and machinery.
For food
products and tobacco
group

in

occurs

sales

provement this year in the second
quarter over the first, although
running well below 1957 levels,
include
tires, paper,
chemicals,

the

seasonal

usual

during

1957

over

earnings

and

tion machinery.

1958.

registering

groups

the

1956

attrib¬

be

divi¬

payments

the year

increase

first

the

quarters could

products

34%
about the

but

the

reported, cash

by the U. S. Department of Com¬
merce,
against a rise of 2% in

selling

the introduction
products.
In

instances

between

to

dend

rials and equipment and construc¬

down

was

ago,

sales

special

petroleum refiners,
experienced, price weak¬

the

generally
second

quarter

WILLIAMSVILLE, N. Y.

H.
Bernard Hammill, Jr. and Daniel

earn¬

and some of the major auto¬
mobile producers, which curtailed

ings were lower, as compared with
either the preceding quarter or

production sharply to match lower
demand. Excluding those two im¬

with

slower

reporting" rose 16%.

the

ago,

year

quently

portant industry groups, quarter¬
ly net income this year of the
other
manufacturing
companies

E.

fre¬

most

Bosworth

have

—

formed

Ham¬

mill, Bosworth & Co., with offices
at 15 Rock Street, to engage in a

mentioned causes were
and high, inflexible
some cases earnings de¬

sales.

costs.

sales
In

clined

the

in

face

of

securities
was

increased

OF

LEADING

CORPORATIONS

FOR

THE

thousands

(In

Cos.
47
-11

23
•"' 8

29
-32

27
S5

52

1957

products and beverages-^
products
Textiles and apparel
:

allied

Paper and

Petroleum

glass, and
and
steel

Cement,

27

Electrical equipment,

44

; 32

47,289

55,751

5,346

10.440

12,529

37,231

39,152

111,418

123,310

65,887

56,308

697,903

522,035

101,760

45,951

SQUARE,

Kornfeld

is

engaging

in

Automobiles

of

name

Mutual

Funds

Co.

of

and

FIRST HALF TEAR

Other

favorable force when it

market

or

for

comes

24

130,654

+

+ 23

--

1957

1958

+ 12

1

$157,302

$159,474

+18

81,058

103,040

■

' %

Change

?3

Trade

20

t

.

and

+

1

—45

—1')

35,769

18,912

matter, all of the markets for fixed income
bearing obligations.
The money which has been
going into the common stock mar¬

ket is in

no

small

at

the expense of fixed income
bearing
obligations, because the feelings and opinions around are very
strong that inflation is again in the ascendancy and one does not
hedge against the loss in purchasing power of the
monetary unit
by making commitments in long-term Government bonds.
measure

Is This
The

an

"Orderly" Market?

(retail

Service

; 53

34
3

and

+ 23

41,900

27,899

Government securities

there

is

nothing

has been very much on the defensive and
tangible yet in the way of help from the

very

Central Banks.
It

was

indicated that the Government bond market would

5

96,726

76,385

—30

+ 11

347,494

234,729

4

—15

116,654

122,197

443,666

—36

—15

1,456,216

965,704

—34

83,315

-—13

+ 81

178,098

129,273

—27

173,881

—44

in certain issues does

seem to have at least a minor
tinge of being
(if not a panic). Most money market special¬
looking for a sharp upturn in the quotations of
Government obligations with the advent of protection by the Cen¬
tral Banks. On the other hand, it was not expected that new lows
would be continually registered in these issues following the aban¬
donment (if only temporarily) of the "bills only" policy.

out of the ordinary

ists had not been

Easy Money Policy Coming to

Electric

+ 33

633,256

304,533

8

209,804

<

+

the Treasury

and

.

—32

5

88,304

—13

+

170,294

—19

55,664

70,376

—20

+ 26

168,143

126,038

—25

130,907

—32

+

8

388,604

252,147

gas,

214,021

146,107

—60

—32

814,851

360,129

—56

45,276

37,317

—38

—18

112,686

82,593

—27

47,871

62,534

—15

+ 31

133,531

110,406

—17

1,624,559

1,619,186

—34

4,972,092

3,243,753

—35

25,642

22.355

—45

—13

81,473

47,997

4

+ 10

28,076

30,882

13,395

14,571

36,644

90,681

+

—13

9

199,518

279,889

212.008

+

6

223,024

243,580

+

9

$2,231,229

$2,233,263

58,526

58,956

+

Emphasis

Total
'Increases

or

decxeaaea

oX

under




17o

or

on

Liquidity

Dealer-Broker Addressing Service
As

publishers of "Security Dealers of North Amorwe
have a metal stencil for every firm and
listed In this publication,
which puts us In
position to offer you a more up-to-the-mlnut# list

lea,"

bank
a

than

you

can

obtain

elsewhere

There are
States

approximately 9,000 names in. the United
and 900 in Canada, all arranged alphabetically

by

States

over

100ft

not

computed.

—28

and

Cities.

Addressing charge $7.00 per thousand.

Special N. A. S D. list (main offices only) arranged
Just as they appeared in "Security Dealers."
Goat
for addressing N A S. D. List, $8.00 per thousand.
at

can

a

small

also supply

the list on gummed roll labels

additional charge

1

31,132

27,985

—10

224,150

+

—46

127,325

—61

—24

459,814

491,896

+

446,817

466,604

+

4

$6,374,004

$4,464,516

Herbert D. Seibert &

7

9

+

\
809

money

—41

223,473

etc

new

spite of the weakness in long-term and intermediate-term
Governments, funds are being transferred from these obligations
into the short-term more liquid issues because of the belief that

—35

81,988

16,815

telegraph

End

would have to raise.

—21

•+

121,245

$3,116,191

power,

Telephone

an

Accordingly, it seems as though not a few money market fol¬
lowers are putting two and two together now and are coming up
with the answer that, because of the pressures of inflation or the
coming boom in business, the policy of easy money is on its way to
limbo. Even though the Treasury is caught in the middle with a
growing deficit that must be financed, it will have to be done in a
higher money market with the bulk if not all of it being raised
through the sale of short-term obligations, which may keep down
somewhat the cost of raising this new money. To be sure, a strong
and rapid business recovery could mean a smaller deficit for the

—52

29,632

wholesale)

:

be

kept orderly by the Federal Reserve Banks, and that may be the
case now, but consistent declines of half a point to a
point or more

—33

+

167,242

and

amusement—

Railroads

-

large Government deficit, along with the higher
wage and higher price spiral, is creating a psychology that does not
build an atmosphere which is making it easy to sell Government
bonds in order to get the funds that are needed to meet the ordi¬
nary expenses of the Treasury.
Even though there will be no
financing by the Treasury before early October, -the market for
very

—47

—22

—19

8,472

15,373

-

40,919

quarrying

been

+ 27

73,555

manufacturing

Mining

has'not

to the action of Government bond

that

We

592- Total
-

in the market for equities.
in the

Net Income

First Half Year

Qr.
1958t

60,238

*-

Miscellaneous

excesses

policy which has been in effect

Reported

First

2,438,592

parts

transportation equipment
manufacturing

28
49

the

greater protection is available in the near-term securities. This
kind of switching proved profitable to those that carried it out
when interest rates started to rise in not distant past.

Long Island.

369,223

products—

of

January. This tight¬
ening of credit as far as the equity market is
concerned, is evi¬
dently part of the program'which will mean higher margin
require¬
ments with advancing common stock
prices and lower margin
requirements with lower stock prices.
^
This attempt to slow down the inflation
psychology, as ex¬
pressed in the strong uptrend in the equity

a

87,562

meral

reversal

stock market since the middle of last

Government and this would cut down the amount of

N. Y.—

193.807

101,882

radio and TV_

Machinery
Other

1958

3)1,526

a

In

Second

$84,413

53,1933

I—

atone

Hammill

600 Hewlett Street under the firm

1957

1958

174,991

.

cosmetics—
products and refining—

soap,

is

common

securities business from offices at

Qr.

19,717

products

Chemical
Drugs,

Fred

% Change from

s

$75,060

)

products

Mr.

partner in Forrest,

Mutual Funds of L. I.

Qr.

48,116

products

rubber

Tires,

a

FRANKLIN

QUARTER AND

Second
,

45,213

.—

Tobacco

Iron

109

Qr.

$83,820

Groups

34
-

First

Qr.

Food

This

of Dollars)

Reported Net Income

,

Second

Industry

No. of

SECOND

business.

formerly

Hammill & Co.

Many companies cited such
"The table gives the changes by factors
as
higher
depreciation
industry groups.
In lines other charges,
research
expenditures,
than
manufacturing
there
was unseasonably cool or wet weather,
continued year-to-year growth in forced reductions in selling prices,
both operating revenues and net intensified
competition,
foreign
earnings of electric, gas, and tele¬ imports,
obsolescence
of
older
phone utilities, whereas declines products, strike interruptions, and
were
experienced by most rail¬ cutbacks of government contracts.
"The
automobile
roads.
companies'
NET INCOME

attempt to prevent speculative

downward

ness,

a

-

The Federal Reserve Board last week raised
margin require¬
on
purchases of common stocks from 50% to 70% in an

Hammill, Bosworth Formed

"Where

\

market,

Conservative

half year were down less than 1%
from a year earlier, as reported

re¬

better

and

other

uted

manufacturing, the total net

from

or

new

second

period

same

last

"Publicly

increased

cases

■

,

rates.

ments

a

growth

business

paper

Obligations Under Pressure

.

nondur¬

long-term

general

cession.

but as compared with the
preceding quarter the gains out¬
numbered the declines by five to
the

their

of

/

reporting

5.2%,

Dividends More

goods producers—a continu¬

the

of

7.0 to

sales
billed,
particularly

—

consumer

despite

one,

"For

of

case

ation

with

compared

dollar

represented

the

able

reporting second quarter decreases
as

in

pansion

quarter of 1957 but practically
unchanged from the first quarter
of 1958. The number of companies

are
very much more concerned with
developments which
have taken place outside of the
money market than they are with
those which are going on.in the
market for fixed income bearing

The sale of

year corporate

decrease of

powers

that be

sales figures for the half year was
a combined sales total 13% under

this month that

for

^he Government bond market

obligations.

worked lower.

are

over-all

.

which has

well

drift

downward

Governments

which indicates that the
easy money
ities is being shelved for one

brought,

closing,

on

is putting on a performance
policy of the monetary author¬
as its objective the
slowing
down of the inflation and boom
psychology. It is evident from the
action which has been taken
to limit the uptrend of the
equity
market (margins were raised from
50% to 70%), that the
,

half- reporting
manufacturing
com¬
reports indicate the panies were able this year to in¬ that for the first half of 1957. The
decline in profits was checked in crease their
earnings from the much sharper drop in net income
the second quarter.
first to second quarters reflects a already noted, amounting to 35%
the
usual
The "Bank Letter" goes on to wide variety of favorable factors was
consequence
of
stale: "reports issued to date by revealed by the figures or com¬ shrinking
volume and squeezed
809 corporations
show combined mented
upon
in the corporate profit margins. For the group as a
net income after taxes in the sec¬ reports.
In some cases the im¬ whole, the average net profit per $
dollar of sales was narrowed from
ond quarter of $2,233 million, a provement was based upon an ex¬
Letter"

Reporter

By JOHN T. CHIPPENDALE, JR.
•

prices,

inventories

cess

half of the

over

Our

operating
than

although
such
prices recently have firmed as
heavy demand continues and ex¬

Changes in Sales and Costs
"The fact that

the

product

earlier, that corporate retained earnings
growth suffered a sharp drop.

City Bank ol
in its "Bank

of

about by the Suez

mixed
The First National

companies,

lower

the first half

in

Declining Corporate Profits Reported

1% from

by

year,
mand

Compared to previous quarter, First National City Bank finds
decline in corporate profits was checked in the second quarter.
Also concludes from cash dividend rate, which is down less
than

affected

were

enjoyed some pickup in de¬
during the second quarter,
mined solely by the Fiscal and
but during July had tapayawage
Credit Policy of our government
increase without having any com¬
and by the international payments
pensating advance in selling
prices. Petroleum company earn¬
position of our country.
ings suffered this year by com¬
parison with the temporary boom

Exchange

of

that

whatsoever to

national piedium of exchange, nor
is

mind

confi¬

an

as

suppliers

curtailment in both passenger car
and truck production this year.

In conclusion it should be borne

for ten on the last occasion

—one

becom¬

leading discount center.

a

29

(625)

—30

Publishers of "Security Dealert of

25 Park Place

—

REctor 2-9570

Co., Inc.

North America"
—

New York City

30

The Commercial and Financial Chronicle

(626)

Meet the

Bateman, Eichler Co.
Celebrates 25 Yrs.
Eichler

man,

Calif.—Bale-

ANGELES,

LOS

&

Street,

Spring

Bank and Insurance Stocks

.

.

Thursday, August 14, 1958

.

Winner-Henry J. Simonson, Jr.

mLS' /p-<■*'

By ARTHUR B. WALLACE

Co., 453 South
members of the

This Week

Pacific Coast Stock Exchange, are

Insurance Stocks

—

Several years ago this space
of

contained

Herewith is a similar schedule

year-end dates of 1946 and 1955.

showing

of assets of these companies for

similar distribution

a

break-down of assets

a

leading fire-casualty insurance companies for the

number of

a

1948 and 1957.
.

Of

in that period

course,

emphasis

there

was

from cash and United States Government bonds.

away

Bonds exclusive of U. S. Governments showed,
even

T

/

.

pronounced shift,of

a

in most cases, an

greater proportionate shift.

In

great majority of

a

and

state

meant

"bonds exclusive of governments"

cases

municipals.

In

numerous

instances holdings of"

preferred stocks were shortened up proportionately; and the 1957:

figures show in most cases
Rudolph Eichler

celebrating

25th anniversary

the

of the firm's founding.

Rudolph

Eichler, Chairman of the Board;
Henry
M.
Bateman, President;
Willard G. De Groot, Executive
J.

'

John L.
Henry F. Mills, Harold H.
worth,
Earl
W.
Fisher,
Osthaus,
Clarence
A.
Richard M. Allen, Charles
Vice-President;

Devlin,
ButterFranz
Walter,

D. Mc¬
Landor, Vice-

Walter

and

Lean

probable that
bond

>

Officers of the firm are

-

At the earlier date

M. Bateman

M^nrv

Presidents; Harry Stemper, Sec¬
retary and Treasurer, and Vera
Assistant Secretary and

McKee,

Assistant Treasurer.

been

had

On

vestment officials'

"growth" stocks.

investment departments
cacious judges of

Exchange, will admit Jacques Ap-

Robert L.
Genillard of Caracas, Harold Mandelson,
Philip
M.
Neagle and
Frank J. Ritger to partnership.
pelmans

stocks that,

being among

investments,

the

On

Hauck

Jansen Hunt,

E.

gen¬

in the firm will be¬

eral partners
come limited

SEASIDE

states

a

se¬

offices

from

at

318 Hamilton Avenue.

that

TRENTON,
is

N.

J.—Wex.ucii

conducting

a

was

out-and-out
trend

cross

over

into the fire lines/ This could

influence

some

pure

fire-ocean

of

increases—proportionate—in state and municipals
into the picture here to a greater or. lesser degree.
Another item Is

that

of income.

The

came
<

But while the

in

was

shifting from high grade bonds to

progress,

so

the

was

betterment

in

the

on

One

Hooked

purpose

served

was

companies

1

-

in

the

long

do

wholesale

term

by

Gov'ts

6.5%
2.9

50.5%
8.5

17.8%

1.2%

58.1

0.4

10.0
4.6

16.4

31.9

19.5

24.9

15.2

4.6

15.2

29.5

1948

8.8

37.4

1.5

1957

3.9

18.1

24.9

1948—

American

Bankers
:1

8.6%

14.0%

5.0

4.5

20.6

47.9

6.3

2.1

19.2

1.0

&

4.9

/

17.3

0.2

24.7

14.0

10.0

7.0

19.4

6.8

10.0

5.7

28.2

4.3

9.1

18.1

2.2

18.3

7.4

45.8

5.3

13.1

10.5

38.7

21.8

10.7

6.1

25.2

1.2

12.0

3.7'

12.9

18.2

59.1

0.6

2.9

29.2

4.6

50.2

6.6

4.1

34.5

9.3

20.0

20.9

11.7

5.7

1957

Continental

9.4

6.0

33.0

40.0

6.1

9.5

20.1

29.8

1.1

15.0

20.3

3.9

5.5

Gas

'

1957

7.4

16.1

37.5

3.9

14.1

1.6

3.7

21.5

15.8

0.1

23.0

6.4

29.5

1957

2.1

21.4

37.5

3.9

14.1

1.6

19.4

6.7

19.3

4.1

2.2

22.5

13.0

27.2

4.0

13.2

8.1

1.2

26.3

6.5

40.7.

0.5

25.7

9.6

27.6

Continental

NORTHERN AND SOUTHERN RHODESIA,

Realistic

interpretation and adof

the

Act

now

un-

der

Congressional inquiry involve
due regard for other responsibilities
the

\

Six Cardinal points

-

of
"maxi-

the objective of "full" or
mum" employment with that
stable

is

money

a

problem.

the

Government

must

fulfill,

That the Employment Act is not

'

intended

in the August issue
business and economic re-

its

view,

''The

of

Guaranty Survey".
these, it pointed out, is to

maintain

sound and stable

a

cur-

to

guarantee

tives

or

that

to

mum"

"full"

of

Fin.

9.3

25.6

1.7

3 3

15.3

18.7

10.0

39.1

18.2

5.1

16.2

38.9

1.3

9.9

7.5

31.4

13.6

0.7

14.3

3.5

14.0

1948

1957

Bought—Sold—Quoted

«■

23.0

39.7

?*kuyers, an/* if1 an economy of

mdividual
cannot

That

high levels of production
employment depend primarily
upon natural market adjustments

ancj

8.6

12.7

9.0

28.6

1957

2.8

18.8

30.0

.

7.0
3.7

.

to
19.9

20.2

3.8

0.9

13.5

6.7

35.0

11.0

"

1957

10.1

23.5

2.5

11.2

8.9

32.8

North River
i

Laird, Bissell & Meeds
Members New York Stock Exchange
Members American

120 BROAPWAY,

Stock

Telephone: BArclay 7-3500
Bell

Teletype—NY 1-1248-49

Specialists
 in Bank Stocks


10.6

:

1957

-

53.4

2.9

6.3

27.9

19.0

0.1

6.1

26.9

4.7

42.1

10.9

2.4

26.1-

13.4

2.6

38.7

'*

Pacific
1948

Exchange-

NEW YORK 5, N. Y.

1948-

„

8.1

51.8

0.7

3.6

_

1957

37.2

4.5

am

— —

—

—

_

Fhoenix
1948-

6.6

19.4

10.1

0.8

38.3

8.6

16.2

1957_

-

3.0

12.1

16.8

2.9

34.1

0.9

30.2

9.9

11.3

17.6

9.8

15.2

Prov. Washington
1948

1957

-

of

who

buy

the

industry," the "Sur-

a

-.r

..

33.7

11.2

5.1

5.1

26.8

36.9

6.2

,

_

currency de•
L,
:

tends to defeat rather

than promote the long-term
jectives

beget recessions,

recessions

-hence

ob-

Employment i Act.

of the

Thatbaoms
and

can

.

progressive

be

can

affect demand

major extent only by manip¬

ulating the money supply; that
is, by inflating or deflating the
currency, the bank noted.
In
practice, it said, this almost in¬
variably means inflation.

avoided
booms

only

to

the

that

extent

avoided..

are

That the

practical danger in the

Employment Act arises from (a)
the

demand

for

perpetual

boom

.

Guaranty
the

"full

expressed

hope

that

inflationary, potential of the
employment
commitment"
-

"by fiscal monetary manipulation
and

may

be

minimized

if

not

com-

pletely eliminated by recognition

"built-in'*, market

(b)

the

rigidities

and

-

11.2
—

investors

Government

27.2

Ins.

1948

and

products

25.5

That
.

vey" said.

.

.

choice, governmentdirectly regulate the be- Preciatl0n

havlor of the millions of eonsumers

2.4

Hampshire

Northern

"maxi-

^

1948

1948

or

employment,

.
•
and cannot be permanently main"Production, ahd hence employ- tained by fiscal or monetary.mament, depends upon the demands jnipulations. '
V
/. 1
;

National Union

New

fixed

authorize the Government to subordinate other objecrequire

,

1957

BANK STOCKS

any

level of employment and does not

_

•

of
still unsolved

rency.

Ins.

Ins. Co. N. Amer.

Merchants

>

„

That practical reconciliation

bank said

19.4

1948

1957

TANGANYIKA, ZANZIBAR, UOANDA,
ADEN, SOMALILAND PROTECTORATE,

by

ministration

One

1948

'

cardinal points..

Company of New York as reducing the inflationary threat of fullemployment policies.

of
2.0

responsibilities.

in authoritative quarters of these

guaranties,
Guaranty Trust

16.0

14.7

•_

Employment Act V

Governmental

governmental

hailed

was

20.8,. 1

1948

MHA, PAKISTAN, CEYLON, BURMA, KENYA,

.

'

5

Ship.

1948

■

,

the first

on

Growing official recognition
that the
objectives of the Employment Act are ideals, rather
than

Boston Insurance

Branches in:

week when relatively few broadbijls were in evidence in

Hails Study of Full

13.5

6.1

_

1957-

Bankers to the Government in: ADEN, KENYA,

<..

to other
Others

1.4%
.

12.1

1948

13 ST. JAMES'S SQUARE, S.W.1

■'- x

^

Pl'ds.

Surety

1957

•6 BISHOPSGATE, LONDON, E.CJ

a

-

—Stocks-

Ins.

Insurance

1948

•BANDA, ZANZIBAR A SOMALILAND PROTECTORATE

;
r

Agricultural

Head Office:

§4 PARLIAMENT STREET, S.W.I

Loans

Insurance

1957

AJ/mlgamating National Bank of India Ltd,
j
end Grindlays Bank Ltd.

Mtgs. &

Gov'ts

Casualty

1948—

Amcr.

-

Guaranty Trust suggests six "cardinal points" to-reduce the
inflationary potential of the Employment Act of 1946. Hails
current Congressional inquiry of the Act for giving due regard

more-or-less

Really

Exclus.

Cash

1957

London Branches

seldom

-V;.■;«

Bonds

H.

BANK LIMITED

•»

strike, it was landed 50 minutes later after a
furious battle which split Mr. Simonson's harness and required
him to be held down in his chair by a companion.
It was taken
on
board
The Hunter,
skippered by George Grathwhol.
Mr.
Simonson is President of National Securities & Research Corpora^
tion, New York City.

standing pat.

AND

- -

insurance executive, when

1957—.

OVERSEAS

-

waters, Henry J. Simonson, Jr. landed this 173-lb. beauty,
Wednesday, Aug. 6 about 60 miles off Montauk Point, Long Island.

asked by the writer how he
could ever hope to sell off the huge blocks of common stocks
held, replied that his company had no thought of wholesale selling
during a panic or depression. He said that as the successive major
highs were always higher, and the successive major lows higher,

North

v

■

local

com¬
..

Insurance

i

/

During

stocks

common

yields

panies'funds.

portfolios.

*

tendency to shift from

bonds to equities brought the companies somewhat better
income,
although just now the yields of the two groups are nudging closer.

1948

'

;r
v

result fire companies

portfolios of the

Aetna

.,

insurance company/:

separation of lire writing companies from

a

a

securities

a

offices at 63

GRESDLAYS

abler and more perspi-

many

Neither group was

casualty companies

Hamilton Avenue.

NATIONAL

our

look at

•

>

Now, however, most

Aetna

business from

to-

—J-'

as

their

Wendell Norris Opens
Norris

media

income

jettisoning of their holdings.

J.—

N.

engaging in

business

fixed

of multiple

there

insurance

insurance

Opens

HEIGHTS,

Peter Madia is

us,

But, growth stocks being favorites of so many investors, it is
probable that they will continue to represent sizable positions in

partners.

Peter Madia

curities

M.

Roland

date

same

and

well behind

pricewise, have justified their inclusion in JhevlistsrH-

Another factor
many

Zurich,

of

war

portfolios will reveal excellent lists of the better bhie/chipsland

exert

Sept. 1, White, Weld & Co.,
York City,
Stock

the

was

minds had turned from

and

members of the New York

and it is v

war,

still government -

And here it is well to observe tha-jt^Jnsurance

and

Broad Street, New

20

the

up

were

through the bull market of the 1950's and in¬

other.

Te Admit Partners

just wound

institutional investors

many

Then, by 1957, not only

war*

we

casualties.

While, Weld & Co,

had

conscious, for they had had to share heavily in 1he financing

of the

but

greater holding of equities.

a

we

sures

under

inflationary

which

the

pres-

Act

has

been and is being administered.

Volume 188

Number 5768

Commercial and Financial Chronicle
The

...

(627)
the remnants of the confused
Deal socialists, who under

are

LETTER TO THE EDITOR:

New

D.

F.

Securities Salesman's Corner

situation

ary

By JOHN DUTTON
t

facing

// Whether

Daniel!"

that

will

that

was

a

their individual clients.

boy back in Ohio

The pre¬

of

/the farmers used to drive into ponderance of buying orders from•j town on a Saturday and the maim; the.lay public was 20 to 30 to one.

is

will

leadership in
forthcoming

be

able

to

suf¬

exert

Florida Reader Says Franz Pick
Overlooks Other Important Factors
Replying to Dr. Franz Pick's provocative paper
("Chronicle,"
July 24, p. 9), wherein it was asserted that bonds are "certifi¬

the great mass

on

stand the true

of

causes

dilemma)

is

our

cates of guaranteed

pres¬

for

doubtful.

very

be, One

street of our village would
very reliable broker friend It is certainly long past the time
packed with horses tied to hitch- • of mine told me that a customer- when articulate people in the pro¬
ing rails and their buggies and called him and excitedly asked* fessions, business, and certainly in
wagons were strung out behind: him to buy her 100 shares of a finance, can afford to offer
opti¬
them.
Every once in a while one leading motor stock because one mistic platitudes about our great

;

;

model of her friends told her that she
early
"Flivvers" would rush by at the- had just ..received a long distance

of

Henry

Ford's

miles 'an: telephone call from

gosh awful speed of 20
hour and

of the

one

ish and nervous

~

up
•'

mares

would

her

rear

moorings.When

would

turn

and

this

some

farmer

the

scared

grab

r

this

near/the bit, and he would
croon and; half command with

not

<•'•••.

healthy.

;

.

Yet-, all this unsound stock

mar¬

ket -speculation' is rooted in the
Daniel/!
whether that basically, inflationary policies of
the ..-Federal
Government.
Such
emale// old *.

a;Whba / I^hp^el,' Whoa
.

and" sure.

;eh^>igh,

horgef/was

"Daniel"- would calm down, shud-/ legislation^, /
der

»

the

*

Wagner

Act

bit, wheeze a little, and go1 opened wide the door to labor
back'/toJfte(^
{dozing on/the monopolies, closed shops, check¬
a

offs

hitchin^^^^'^-'V •
Time, to

of

union

to

dues

controlled

Grab

the

Bit

Possibly by the time this "piece
,

unions.

used: their

-Vv

gangster

uncontrolled

in

They

turn

power

to

drive wages constantly upward

-

by

reaches the: pages of the. "Chroni¬ threats of industry-wide and in¬
cle" old '"Daniel"
stockr market« dividual company strikes that has
may have quieted down a bit but had management powerless to re¬
sist.-;. Even

thing is certain, it is going to
take, more than wordsjV cajoling,
one

the

or

recent

President

utterances

this country.

Since 1932

sufficient
-

production to

sate tif or-the

have/ rise

we

greatly improved
has / notresulted

chinery

the

.of

inflation /in*

control

to

;

.

sharply

ma¬

in

accelerated

in man-hour wages

through-

manufacturing
more/and/ out- industry.. What could we ex¬
more bank
Who is
money by selling bil¬ pect; tout-higher prices?
lions of government bonds to the •surprised:? about
gangsterism
in
labor —...except the Congressmen
banking system. Everytime there
has been another deficit

to

our

supply. The
of this

money

underlying upward

who. created, the climate

have

we

into

grow

.

for it to

national cancer?

a

v

,

t

The

surge

"drop v in automobile con¬
sumption-, steel tonnage, and gen¬
erally" shrinking profit margins,
pluS: unemployment, are the end
tors that money is losing its value results of
high prices, high taxes,
at
an
ever
increasing rate and unsound labor legislation as well
they believe it will continue to do as too much: chrome, fins, and
so.
The
words
of a President horsepower that 1958 cars offered
mean little when the facts of a $12
to the public.
billion deficit stare you in the face
Inflation Can Also Be
and a wildly profligate Congress
Deflationary
adds hundreds of millions to an
stock market is

direct reflection

a

of (a) A

widespread conviction on
the part of investors and specula¬

.

.

,.

.

During every period of rapidly
bloated defense appro¬
priation bill., (b).The capital gains- rising costs the profit margins of

already,
tax

frozen billions of

has

worth

of

stocks

common

dollars
in

boxes that under conditions

industry/:

variously affected.
Some companies will show lower

bank

which

come

mendous

of

idle

waste,

extravagance)

now

stock

the

into

are

the

market

stock

straight

line

Neither

go

of

.

disillusionment

falling

prices.

and

Only

sharply
most

the

astute and nimble of stock traders

the

will emerge from such a situation
with a ?partly whole hide when

price of available stocks
upward.
•"
'

up¬

y

inflationary
Bull

Markets

Generate

More

earnest.

Participation

Public

raising of margin require¬
ments in such a situation is at best

services
this

add

in a „bull market
upward, tipster

fuel

the

to

fire.

In

of rapid com¬
munication,, with radio broadcasts
given over several times during
the day to stock quotations; and
day

and

age

magazines, newspapers, and even
the
TV
giving more and more
space

and time to the gyrations of
market, an ever increas¬

the stock

ing psychological urge to "get on
the
bandwagon"
is
generated.
True it is that the thinking of the

public
what

is
the

the

best

indication

market

stock

will

of
do

day to day, rather than the
statistics that indicate real values.

from

During the past week I made a
check

with

several

representatives
Every

one

on

told

a

me

take

that

hold

the

depreciated seriously for
to

tors

will

stocks

those
.

come

rush

—

into

again at

once

who

had

overvalued
a

time when

the

foresight to
buy/ last. February and March
will be glad to take their long
term, - over six months, capital
gains.-,,This has happened before,
and

though I am far from
market
diagnostician,

even

expert

,

wouldn't

want

to

bet

swings in this market
duplicating past performances in

practically no selling orders from

which

is

the

mental

result

.

of

unsound,

labor, policies,

govern¬

Last

week

for

the

Controls

and

price

President

western Senator

just such
represents

a

again
Yet

quick to rush
forward and he

same

Stevenson s,

and

the Mrs. Eleanor
all

the

Analysts,

rest)

who

as

"Commercial
C h

onicle,"
only
i guing
and challeng¬
ing but defi¬
nitely
stimu¬
lating.
t

n

lands

r

We cannot

not

was-

i

real

estate values of many rural
and most
growing cities
reported in the- have> increased
over
threefold
and
Financial since 1929).
/
«,

-

r

is

most

initiated

were

and

respects, and magnified
in others, by this. Administration.
: •

This

be

column

expert

an

do

feel

we

to all these

with

the

does

have

we

to

the

answer

weighty problems, but
indulgence of the
the "Chronicle," it is

hope: that

our

claim

kind

editor; of

here

pressed

not

the. market, nor

on

agreement

financial

the
■

opinions

may

among

ex¬

find
some
those in the

community

who

have

influence in Washington and other

places

where

policies
it,

public

opinion and

motivated.

are

must

As

we

see

to

grips with
such problems as deficit spending,
monetizing the debt through the
we

come

than

been

the

achieving

a thoroughly objective
of our taxing system and

study
a

complete set of reforms in this

highly important
tional

area of our na¬
Otherwise, inflation

life.

of

freedom

concentrating his studies and an-*
alysis so definitely on one of the
important phases of world econ¬
omy
and
specifically our own
economy, it may have become an
idee

tention and very

definitely to the

attention of the readers who may
have become panicky as a result
of the

hearing and reading of his

address.

point to recall, and
that is certainly elemental, is that

other

100

William

City.

Street, New York
Saks was previously

Mr.

Form Sec.
WICHITA

or

is

currency

merely

buy shovels, one compares the
price of shovels in the terms of
currency and the price of wheat
in terms
of currency
and thus
gains a comparative relationship
of

values

for the

purpose

of

ex¬

is
right, and very
indeed, when he calls to

Pick
so

the

attention

our

definite

con¬

tinued plight of those

with fixed
incomes, whether in the form of
pensions or secured by bonds or
Of

course

there is the

constant, namely, the definite, un¬
changeable income in terms of

Enterprises

FALLS.

a

In

words, if one wants to know
bushels of wheat will

mortgages.

with Bache & Co.

Tex. —Se¬

dollars, and the variable, the

con¬

stant decrease in the value of the

curity Enterprises, Inc. has been

dollar

exactly the

pur¬

formed with offices at 2000 Harri¬

chasing power of the dollar.

One
Pick

son

Street to engage in a securities

business.

Officers

Truman

are

K.

Pennell, President; Kenneth John¬

Vice-President; and Alva D.

son,

must

or

more

fully

that

with

agree

certificate

a

of

mortgage is merely

economy

alternative,

neither

yon

bond

a

or

at 121

thoritarian

8435

SPRING, Md.—Rudd &

opened

guaranteed
to

or

a

minus

controlled,; economy-—
absurdum, the com¬

munistic controlled economy. Our
capitalistic laissez-faire economy
does every so often restore

the

decade before.,

All you have

to think of is the

price of eggs in
1900 and the price of a
pound of
butter; in. 1900, which means the
may
value

power of the

increase

by

its

few

a

dollar. It

purchasing

cents

or

a,

few

percentages, but never regains the
purchasing power of 10 years be¬
fore.

Dr.

^

Pick, while expressing

re¬

gret at the fall of the purchasing
power of the dollar and
so

saying in
something
be done about,
it, does not
words

many

must

offer

that

remedy

any

or

of

course

action, because actually there can
be no forcing back the value of
the

dollar, except, in

strangled'

a

and authoritarian controlled

econ¬

omy.

.

Depressions of course are re¬
grettable and unfortunate* but. it
is part of the make-up, or rather
the machinery of operation of our
free
economy.
When a person
overeats

and

done after

a

the

overeating

is

continued plentitude

of food

consumption, then one is
temporarily sick and regurgitates,
and then

his

ultimately

health

additional

and

his

recovers both

appetite

for

food.

,

at

Another

Side

covered

singles out

who

ones

as

understand

the
the

of
a

currency have dis¬
cure
for stock reces¬

sions, depressions or the constant
depreciation of the dollar.

DR. JOSEPH M. WEIDBERG
ventories, particularly those of
goods, one sees another 3511 Flamingo Drive,
picture. Accepting Dr. Pick's per¬ Miami Beach, Fla.
centage of yearly decrease in the August 1, 1958.
purchasing power of 3.1%, one

a

branch office at

observes

increase in value

an

ex¬

pressed in dollars of at least that

Avenue

under

of

Baruch
"r*~:

witz.

•.

Rabino-

*

go

increase
dollars

in
has

&

Co.,

away on

New

York

Aug. 6.

City,

3%

sibly

Henry W. Bull

even

of 6%.

more

value
been

and

than

1930, the
expressed
in

at

is

as

the

rate

continuing

of

pos¬

at more than the rate

So what

purchasing
the

far back

as

over

Henry W. Bull, partrjer in Bull,

Paine, Webber in Gary
GARY,

the
To

management

passed

that

even

reductum ad

only

much.

Georgia

Holden

nor

durable

Street.

Co. has

I

nor

whom Dr. Pick

zero

Opens

South Church

something

to

time

a

However, when one looks at
SEBREE, Ky.—Rollan C. Smith other phases of capital
values,
is conducting a securities business namely stocks, real estate, and in¬
offices

capi¬

our

laissez-faire.

Dr.
Pick would like to
see,, is an au¬

sickness

from

our

It may be a vicious
cycle, but
thus far not even, the 12 men

Looks

R. C. Smith

to

depreciation, reducing it

constant

in

Dr.

value.

Luffman, Secretary-Treasurer.

of

hew many

much

Howard J. Saks\is conducting a
securities business from offices at

under

talistic

purchasing

first

The

Dr.

Saks Opens Office

"return

to

fixe and make him overlook
important factors. Like the
part
proverbial saying that one some-, of the value of the dollar by a
times cannot see the trees for the prolonged
depression, but notice
forest, Dr. Pick's oversight may the emphasis on part.' The doll&r
be called respectfully to his at¬ never gets back. to the value of

other

change.

itself.

course,,

The

short-term

to

purchasing

not be stabilized
Dr. J. M. Weidberg

money

governments

the

sheep," it is definitely regrettable
that our dollar
buying value can¬

unit for comparison of values.

system, unsound labor
legislation and the long delay in

in

Deplores Alternatives
Of

sale of billions of dollars worth of

banking

dividends,

even

decreased

world

has

he

capital invest¬

form of

power of the dollar.

President
Roosevelt's
New
currency
is
Deal, and has been kept alive by? unchallenged
the Administration of Mr. Tru¬ and respected,
but
man, and only slightly modified
possibly
some

the

amount of income while the
cap-,
ital is being increased more

by

in

disregard the return
these

interest, which
though subject to the confiscating
taxes, still does leave a certain

prob¬
of

on

of

in

rents

one

ities

of

ments

Dr."

That'

come

Deal, Fair Deal "Americans

Roosevelts

without totalitarianism.

the
greatest
living author¬

left-wing,

(the

cure

The address of Dr. Pick before
the New York Society of
Security

tax,
inheritance
taxes,
capital
gains taxes and 52% corporate in¬

taxes) which

;

value expressed in dollars

m

Editor, Commercial and Financials vested
dollar, invested in stocks,
Chronicle:
real,
estate,
etc.
(incidentally,

ably

a

was

bill
the

controls.

a

the steeply progressive income

in

confiscation," Dr. Weidberg finds there is,
oversight in neglecting the corollary to^ price

an

stocks, real estate, inventories, etc. States Dr. Pick
offers
remedy to price inflation and doubts
anyone can achieve

no

Pick

SILVER

warned against the use of Federal
wage

of

extravagance, and iniqui¬
(existing here today

tous taxation

Rudd & Co. Branch

As

And

New




are

of

Socialistic

this respect.

for Democratic Action" group

had

I

short-term

customers'

they

an

against the

busy

day.

in

dollar

surely not
before Christmas, 1958, at any rate.
Yet, many amateur stock specula¬

ineffective as a deterrent to
stock speculation. As the surge of
uneducated wide-spread public
stocks

forces
doubt

time

some

very

carries

I

*

will be

The

participation

making the
exploiting it. Capitalism
must eventually
destroy itself
through c u r r e n c y depreciation
most

in
The

large supply of dollars is shoving
ward and

are

example,

inflation which is the increase

up

to

infinity.
waves of public enthusiasm to buy
stocks will be tempered by periods

the

and

as

very
much
nation's
Achillesare

loss

a

deficits,
and
are
rushing

market

neurotic

will not be controlled without the

does

dollars

(created by years of government

profligacy,

and

be faced with extinction.

into the market.- Tre¬

sums

immature

earnings,-others losses, and those
in a-weak financial position may

existed prior to this unsound and
unfair
tax
upon, capital
would
have

the rate of three percent a
year
being
something
we
can
well
digest. Certainly the Russians (as

compen¬

been

added

wealth, productive capacity, and
such things as gradual inflation at

unfortunately, happen and they their
leaders)
are symptomatic of an increasing
aware
of
this
feverifofi speculative activity that; heel and they
is

horse
half

cus¬

that

stock should advance 30 points in
the next 60 days. -These things,

and nearly rip the tether, rein

from

other

an

tomer's^ representative

skitter-

more

happened, invariably

?

nation

people (who do not under¬

our

ent

this

actuality.

not

or

be

ficient influence

When I

foundation for

as an

Washington

WHOA

the

the chaotic and difficult inflation¬

now

i

laid

R.

31

one

loses in

the

of the dollar is
compensated for by

power

increased

value

of

the

in¬

Jackson

&

Ind.

—

Paine,

Curtis has

Webber,

opened

an

office in the Gary National Bank

Building with Le Roy B. Murdock
in charge.

Thomas W. Mitchell
Thomas W.

Lunt

&

Mitchell, partner in
Mitchell, Buffalo, N. Y.,

passed away on Aug. 4.

The Commercial and Financial Chronicle

.

.

Thursday, August i4, 1958

.

(628)

Z2

modest

Continued from page

9

Problems

Investment

The Alternatives

Relationships

(about 90%), there

today

Someone once said, "Everybody
time, not many months ago,
when this type of investment pro¬ has public relations—success de¬
vided a yield in excess of 3%. The pends
upon
whether they
are
important thing to remember is good or bad." The Investment Di¬
that your reserve should produce vision of a corporate fiduciary is
a dollar for every dollar invested
in a very sensitive spot in this
when the funds are required.
area
because securities comprise

was a

In Decedent's Estates
is especially true m
in which the resid¬
estate remains in trust. Most

flowers. This
those estates

for

Agent

(3) The ultimate distribution of
estate. If the estate is to be

Executor

a

corporate

Frequently,

the

the major asset of most of today's
estates. It will, in some instances,

fidu¬

The Burnham conception of

corporations

of

agers

the

of the technical man¬

emergence

as

new

a

class now seems utterly
fantastic. Perhaps it seemed more
ruling

rational in the economic

of

ment

1941.
have

mand in

recent

environ¬
and

Engineers

been

scientists

in great

de¬

of business

years

be

deluged with advice from many expansion and improvements in
distributed to the heirs as soon ciary is requested to act as agent sources, some of which will be, technology,
and
doubtless
will
uary
as
it is settled, the investment for an individual executor. It is helpful.
However, the Trust In¬ continue to be in demand. But
^^experienced individual execu¬
most important that the Bank re¬ vestments Committee of a corpor¬
they are not sought as benevolent
tors are loathe to make invest- program of the executors may be
member that it is serving only in ate fiduciary has an aggregate of and
kindly dictators.
* »*»ent decisions until such time as quite different than it would be
an
agency capacity and that its basic investment knowledge which
developments generate them into if, after the executorship, a longCorporate managers beset with
It also has troubled stockholder relations
range
trust is to be established function is ministerial. It should justifies confidence.
etction. As a result, the same ad¬
be careful to avoid the acceptance experienced
for support of a family.
and
understanding
vantageous investment opportu¬
may find appealing at least a por¬
of a delegation of discretionary personnel to carry out its deci¬
A living person sometimes has
tion of the managerialism of Berle
nity may not again be available to
only his principal sions and policies. These, together
such a large capital gain in the power which

the*

indirectly, to the

trustee and,

contain investment
restrict the execu¬

wills

Some

clauses which

certain types
of securities. In these estates, the
wise fiduciary will confine him¬
self to the areas of investment
specified and any departure there¬
(and trustee) to

tor

risk.
Not
infrequently, a corporate
executor will be administrating
mn
estate wherein the will pro¬
from will be

security that he con¬
it merely for that
reason.
He is likely to feel that
"I can't afford to sell it."

at his own

has the

vides that another person

and authority to direct the
investment policy and actions of
Che corporate executor. This in-

ftower

should

Such an arrangement

by the

for granted

taken

be

not

a

to hold

tinues

estate, however, this sit¬
uation is corrected.
When the
executors sell a security, the own¬
In

an

not matter.
figure used in computing cap¬
gains (or losses) is the cur¬

er's original cost does
The
ital

value

rent

finally

as

settled for

Thus the es¬
advantageously

death tax purposes.
tate

often

can

market

original

owner

which

investments

the,

obliged

felt

had

retain for tax

to

tage of the estate, he is duty bound
to resist complying with the di¬

is

to be sold and the

which

upon

public relationships are
They are also some of the
why more people are be¬
coming aware of the fact that the

good

agent, it will not be placed in the

reasons

position of doing something which
the

corporate fiduciary is best quali¬

principal, himself, had

thority

no au¬

to do.

or power

fied

to

serve

as

their

executor

their

about

go

may

managers

business.

proper

would not
relish the rest of the philosophy.
The end result would be inevita¬
such

But

bly

and trustee.

Such

profoundly wish that stockholders
would hurry up and- abdicate and
thus allow corporate officials to
managers

corporate state with major
concerning product de¬

a

,

decisions

expansion, wage
dividend policy and the
by government. Indeed
corporate managements to whom

velopment,

Continued

The

policy,

from page 7

like made

the idea of stockholder abdication

Corporation's Relationship

would probably
they realized
the extent to which the philosophy
appealing

seems

if

disconcerted

be

With Its Owner-Stockholders

managerialism
follows
the
concept of economic

of

Marxian

poration

that

interests

ought

not
of

to

found

cor¬

liqui¬

that

really

Some

of

control

a

these

con¬

include

the

evolution.
The

peculiar genius of the free

market

(1) An increase in the number

not

are

point to

may

test?

following:

manage¬

careers

in

a

be

corporate

Satisfying

be

to

be in the real

even

ment.

timetable to be

foundations

formed.

dated may

the best interests of

followed for

that,

so

The continued existence of

stocks

duty to select the bonds or

acting

uncompromising good faith,
the

are

Means.

and

with

as

for an estate that is being
settled, it should not be regarded

It behooves

there is any reason to believe such
action would be to the disadvan¬

principal

program

this power as the role of tne executo
him to gamble upon short-term upward
investigate each specific direction or downward turns of the securi¬
It is the executors'
the individual exercises and, if ties market.
direction.

of

It must also be

diligent with respect to the pow¬
ers and authority under which its

reasons.

sharing

not

executor

should exercise.

preparing the security sales

In

dividual may also be a co-execu¬
tor.

of

value

beneficiaries.

trust

of complaint letters
decadent holders.

from

stock¬

on

that

resources
liberal basis

the

of the continuous collective
ment

in

the

of

room

enterprises.

is

system

allocated

are

"

people. There

judg¬
is no
for

free market system

a

Then the program
(2) Persistent rumors regarding a "ruling class" whether that class
Some of the corporate circum¬
will be carried out— stances or management practices the company which appear to be made up of technical managers,
without holding back or speeding that tend to stimulate or
have
no
foundation
of
fact
or
Doses a serious problem and neces¬
induce
corporate officials, or bureaucrats
sitates a diplomatic but firm ap¬ up transactions in an effort to an¬ stockholder
source.
•
\
' and commissars.
dissatisfaction are:
proach which, again, only a pro¬ ticipate day-to-day turns of the
(3) An apparent increase in the
(1) A relatively poor record of
This does not mean that.cor¬
fessional executor can be relied market.
earnings and dividends especially volume of trading in the stock.
porate managements ought to be
The comparatively short period
■upon to have by reason
of his
during a period of generally good
(4) In the case of publicly held interested only in short run prof¬
previous exposures to similar ex¬ in which funds must be raised is business. When the
management companies,
an
increase
in
the its for stockholders or stock spec¬
an
important element.
Diligent is
periences.
not doing as well as the man¬ number of shares held in brokers ulators. The
long run. interests of
and experienced trust investment
agements
of comparable
enter¬ names.
Sale of Securities
stockholders require that the cor¬
officers can arrive at competent
prises stockholders are perhaps
What are some of the steps that poration be administered in such
One of the many "first".invest¬ conclusions as to the worth and
justified in believing that a change
management can take in order to a way as to advance the general
ment, considerations will be the merit of certain securities from a in control is
warranted.
either avoid contests for control interest;
but there need be no
estate's need for cash.
Thus not long term investment viewpoint,
(2) Management or controlling or
at
least
to
have
advance pious
pretense that corporations
but very few would be so daring
only are the immediate require¬
interests that include those who knowledge of such contests?
are essentially charitable
institu¬
In
ments of the beneficiaries to be as to use a decedent's estate in an
have business relationships with the first
place it should be said tions. Indeed it ought to be quite
considered but also the need for attempt to "mastermind" the mar¬
the
enterprise, which may be that by far the best method is clear that deficit producing cor¬
cash to pay all taxes and other ket in assuming an ability to fore¬
expenses.-Usually the executors cast market prices over a short basically in conflict with the in¬ simply to do a good job of man¬ porations cannot advance the gen¬
terests of the main body of stock¬
term of months.
aging the enterprise in the sound eral economic interest.
are required to produce more cash

This

rection.

type

estate.

the

situation agreed

of

upon

■

.

.

,

,

,

:

thai

i

the

owner

At

Usually,

Securities

of

Purchase

;

: )

adminstra-

the

of

start

the

holders.

of the estate would

•normally have had on hand.

executor

an

does

not

other costs of settlement.

A plan

purchase securities in a decedent's
estate,
other
than
short-term
U. S. A. Goverment obligations,

ahould be worked

the

if the residue is distributable out¬

tion the
a

should

executor

careful

estimate

of

prepare

and

taxes

out ,so

re¬

quired cash will be available when

reeded, and the first investment
review

of the

estate

should

con¬

tain recommendations for sale

of

right.
However, in some juris¬
dictions, where the residue is to
be retained in trust, and the pro¬
visions
to

authorize him

will

of the

the executor may wish
to
take
advantage
of
existing
purpose.
favorable investment opportuni¬
Investment officers cannot fol¬
ties and make several changes in
low any cut-and-dried routine in
the estate's security portfolio by
preparing the investment program
lor an estate.
Each situation is selling securities and purchasing
others. By so doing, at this early
different, and the recommenda¬
date, he may be in a better posi¬
tions which are made for retain¬
tion than he would be as trustee,
ing or selling the estate's securi¬
at a later date, to provide security
ties will have to be based

cecurities to provide funds for this

upon

the individual tacts for each

case.

Among the factors to be consid¬
ered

are:

Cash

Estate.

requirements

When

sufficient

of

the

cash

is

not available, some securities may

have to be sold,
:■

even

though they

might otherwise be desirable in¬
vestments.

In

which stocks

or

balance for

of

the payment

should

holdings which

securities.

to

Some

dispose

of

the

are more specula¬

tive and will seek to retain bonds
and stocks which
to

and

likely
provide dependability of in¬
and safety of principal.
are

more

come




a

ation of the value of other assets.

(4)

A

that

corporate

includes

seems

ment

organization
device

some

that

tion, such

management voting

as

of

stock held in

company
sion fund.

pen¬

a

necessitates

(5)

small

A

owns

assets,

etc.,

or

rials

or

uable

has

enterprise
to

access

which
patents,

processes,

raw

mate¬

markets that may be val¬

to

larger

a

In

company.

instances the "valuable"

some

sets may

be

a

large

as¬

tax

carryover

loss.
From

the

incumbent
sential

to

point

of view

have

ample

an

is

it

management

of

es¬

notice

of

control in order to avoid surprise
and to have ample time to plan

Other Reserves '

and

which

Funds

have

been

and

raised

for the payment of taxes and other

in connection with sett¬
estate may be temporarily

purposes

ling

an

invested

in

short-term

Government

obligations

Bills

risk"

to

S.

A.

pro¬

pending disbursement

and distribution.

"no

U.

is

U. S. A. Govern¬

one

example

short-term

of

a

investment.

These may be "rolled over" from
time to time and several maturi¬
ties

are

available to coincide with

the need for funds.
rate

of

return

,or

Although the
yield is most

nize

it.

generally able to
They

do

not

trade secrets

want

or

tricks

elaborate

or

relations"

or

carry

impending contests for

out

appeal. In the

vigorous

a

case

of

a

proxy

publicly

held company subject to the juris¬
diction of the SEC and its proxy

rules,
come

the

this

notice

will

in the form of

stockholder

list.

a

ordinarily
request for

But

by

this

time the dissidents campaign
may
be well advanced. In the case of a

smaller
the

company

not

subject

to

SEC

regulation, and where
there is no plan to formally solicit
proxies, the first notice
at

recog¬

expect
other

or

stra¬

the

stockholders

may come

"stockholder

programs.

have
ire

slick

annual

paper

Many

cor¬

already aroused
by over-elaborate

stockholder

possible

Tax

are

porations

to

may

and

likely to create an instru¬ tegic matters to be revealed. The
for management perpetua¬ problem cannot be solved by slick

eficiaries.

be

be made, the execu¬

try

which

over

consultation with the income ben¬

ment

to

Relevant

of income is an in¬

problems

create

sales

are

flow of income

element

tax

come

vide income

will

portfolio and in¬

beneficiaries.

the

securities purchased for personal
investment are not equally good
investments for the estate.* When
tors

the

the prompt

itiate

investment

and

recommending
bonds

liquidated, investment men will
naturally pick out for sale those
which they think add least to the
strength of the portfolio.
(2) Types

so,

diversification

to

(1)

do

interests of owners and to supply
signifi¬ essential details of the progress of
cant period of time at a level be¬ the business currently to the pub¬
low
what
would
seem
to
be lic
including
the
stockholders.
are
realizable liquidation value, espe¬ Stockholders
discriminating
cially when the price of the stock ,and sophisticated and do not ex¬
is
below
the
net
current
asset pect
the
impossible;
moreover
value per share without consider¬ they are allergic to propaganda

(3) Share prices

reports

filled

are

the

must

advisers

continue

not

to

tolerate

a

class made up of corporate
tors

officials

and

who

will

ruling

direc¬

maintain

their control of large aggregations

essentially

of capital by means of

machinery

election

undemocratic
and

practices. They must seek to
genuine
democratic
cor¬

build

porate control by stockholders by
abandoning opposition to such re¬
forms as cumulative voting, and
to

cease

cratic

support

devices
inside

the

such undemo¬
voting trusts,

election^

staggered
and

as

directors,

of

board.

The

un¬

with pictures of company
products and personnel. Primarily

pleasant alternative is a continua¬
tion of the dreary drift to statism

the

job

in

and

not

largely

A

few

is

for management
relations counsel.
suggestions are indicated
one

economic

affairs.

public

Bruns, Nordeman Branch

below:

(1) In the

of publicly held
stock, check the number of shares
bought and sold against transfers,

branch

in order to trace the drift of stock

Sarah

into

sentative.

case

brokers

(2)

or

"dummy"

names.

quate detail.

Frequent discussion of the
company and its plans and pros¬
pects by management before such
groups as security analysts, bank¬
(3)

ers,

trade

eon

clubs.

(4)
curate

WASHINGTON,
&

Nordeman

Co.

office

C.—Bruns.

N.
has

here

opened a
Mrs.

with

Campbell Elliott

as

repre¬

Prompt publication of fre¬

quent financial statements in ade¬

groups,

or

even

lunch¬

although ac¬
estimate of the company's

public
statement.
Nothing is quite so productive of
stockholder ire as a glowing pub¬
prospects

J. K. Baronett Opens
(Special to The Financial Chronicle)

CHICAGO, 111.—John. K. Baron¬
ett is conducting a securities busi¬
ness
from
offices at 112 South
Michigan Boulevard.
/

Conservative
in

meeting:
lic report of the prospects of the
signs of poor or company followed
by
poor
or
deteriorating stockholder relations mediocre performance.
What

their

and

in

managements

Corporation
control

choose. The American people

Forms Elliott

Bradley & Co.

(Special to The Financial Chronicle)

SPRINGFIELD,

111.

—

Elliott

Bradley has formed Elliott Brad¬
ley &
Co. with offices in the
Ridgely Building to engage in a
securities business.

.Volume 188

Number 5768

The Commercial and Financial Chronicle

...

(629)
into the system — which
in fact be "multiplied"
by the commercial banking sys¬
tem. It was argued that this cut
money

Continued from page 2

money can

The Security I Like Best
price. The

company

has developed

the so-called "Zimmermann Proc¬

could
the

a
stream

stimulate

so

government

business

would

processed by the

new plants.
Be¬
cities and industries
throughout the world have similar
cause

many

_

.

the erection of two Zimmermann

shares

Process sewage disposal plants of

listed

the

on

New

York

Exchange, to have dramatic
capital appreciation possibilities,

thus offering a combination found

city. The company will
engineer the plants and will re¬ only too rarely in
■
ceive
royalties on the tonnage stock.

does

about is likely to be
However, there will be
a
sharp rise in family formation
in the early 1960's" as a result of
the upsurge in births as the nation
come

moderate.

moved out of the

depressed 1930's
the war period
and the prosperity that followed.
This will provide the background
against which another period of
economic
expansion could,
and
into

boom of

the

good quality

a

periencing
bles

of its

6

page

properly controlling the

credit system

and

money

of

the

United States.

While

.

Federal

the

Reserve

Board Index of Industrial Produc¬

tion

down

was

in

126

to

(1947-49=100) from
unemployment
five million—prices
and

a

April

peak of

rose
were

14^7

to over
still in

a
gently, but nevertheless defi¬
nitely, upward trend.
This reflected the problem of
attaining a full employment econ¬
omy without generating inflation.

And it has caused the Federal Re¬
Board

serve

to

be very

cautious

(perhaps overly so) in its moves
to

■

credit and

make

been

ex¬

recession,
having trou¬

been

sluggish for
some time. The long-term increase
in demand 1935-37) was at a com¬
rate

of

about

5%%

per

But domestic demand has

shown hardly any growth for the
last two years.

money

more

readily available and less costly.
Despite some long-term wage
contracts
calling for wage in¬
•.

In

view

of

the

fact

that

plant

expansion depends upon expected
increases in product demand, (ac¬

no big -change in prices November 1957 and has lowered have felt the imbalance of demand
probable this year.
the percentage of reserves mem¬ and supply and declined steadily
1958 but have
ber banks are required to keep during 1957 and
The Inventory Picture
against deposits. More recently recently strengthened.
The economy has experienced the "Fed" has
The petroleum industry is re¬
reluctantly adopted
an
inventory recession. Whether the policy of supporting long-term covering from the recession slump
the recession will be something TJ. S.
Treasury securities as well and further growth, of course, is
more
serious depends upon the as short-term
governments.
expected.
efficacy of monetary and fiscal
Conclusion
Its action in the buying of U. S.
measures to be mentioned below.
securities
(which creates easier
In
conclusion,
the
American
But the nature of the present in¬
money because the "Fed" pays for economy
has passed through a
ventory situation is worth de¬ these securities with its checks)
business
recession
which
pro¬
scribing now. Inventory changes has been less than vigorous. This
ceeded
somewhat
more
rapidly
are
among the most volatile of action would show up in "Reserve
than, but in the manner of, those
all components of economic activ¬ Bank Credit"
extended, which by of 1949 and 1954. The recession
ity. The net change in business in¬ March this year had expanded less took the form
of an
inventory
ventories in 1957-58 has been very than in
periods of "tight money," drop in which businesses lived off
similar to that of 1948-49 and
partly due of course to a drop in inventories and production was
1953-54. In only two years since rediscounts but
partly due to a reduced.
World War II has the inventory cautious
policy on the part of the
One important distinction be¬
component of the GNP accounts
creases,

seems

Federal Reserve.

been

significantly negative—1949
And 1958 is virtually
certain to record the largest such
and

1954.

It is clear that the Federal Re-,

is moving in the
right direction; it is not clear
figure since the war. It remains whether they are moving fast
to be seen whether this will be
enough.
the

effect

main

the

of

1 All that

this

can

be said

component

behaved

as

of

now

the

is that

economy

in previous post World

War II recessions, and that in and
of itself it probably has turned
around this year.

System

serve

1957-58

recession.

the

In

The

Fiscal

and

critical

Policy

element

in

realm

ment)
the
"turn-around"
was
clearly called for in the fall of
1957 and the winter of 1958. How¬

the

ever,

the

severe

retrenchment

on

part of the Federal Govern¬

the

which

second

began in earnest in

half

of calendar

1957

the

and

of regulation of the money supply

In

and appropriate taxing, spending,

note

and

borrowing activities on the
part of the government. Economic
growth without inflation-distorted
wages
such

and

prices

is the

goal

of

policy.

The most

the money

for

this area, it is interesting to

why
a

important element in

Digitized for


tax

some

cut

Recognizing
effect

on

spending
these

supply today is bank
FRASER

recession and those of

1949 and 1954

was

that it occurred

background of declining
investment in plant and equip¬
against

one-third of the

over

New

York

•

in the Adirondacks and

Catskills.

Among the large cities served

Share

are

;

,

earnings showed little
during 1946-51 but have

change
Binghamton, Corning, Geneva, increased
from $2.18 in 1951 to
Elmira,
Lockport
and
Ithaca.
$3.45 for the 12 months ended
However, about 70% of the 1,400,- June
30, 1958 (which compares
000
population
large cities.

of

About

and

dential

of

outside

with

$3.01 in the same period,
1956-57) i Several favorable
factors account for the large cur¬

gas.

rural

47%

for

revenues

19%

and
for

is

"

80%

electric
counts

served

are

The

resi¬

business

of

electric

rent increase in

ac¬

earnings: (1) The

interest credit

on construction for
the 12 months ended June 30 was

reve¬

commercial 20% and indus¬
The residential load is

larger than usual—26c
double

the

amount

share

a

for

the

or

pre¬

considerably above average and vious 12
months—reflecting the
with the majority of industries in
large construction program.
(2)
the
lighter categories, earnings
While the New York Public Serv¬

show

considerable

stability.

In ice Commission has not
yet for¬
mally approved it, a $4.2. million

contrast with its neighbor Niagara
Mohawk Power, New York State's

earings

have

increased

rate increase went into effect Feb.*

steadily

1, boosting earnings (after taxcs>
5c
per
month; this ac¬

since 1951.

about

Sources
from
well

of

electric

industrial

customers

diversified.

industrial

In

revenues

from

fabricated

10%

from

revenues

1957

were

counted

are

23%

for about 25c of the

in¬

(3) Cold weather in early
probably aided both gas and"

crease.

of

1958

obtained

electric sales.

metal

ment.

deficit
is

economists argued
at an early date.

that

the

consumer

might

economists
which

equivalent

be

and

business

very

noted

would

to

immediate

be

small,

that

the

incurred

injecting

new

glass

about $26 million

average

may

This makes recovery more

difficult.

C. A. Benson Co. Opens
PITTSBURGH, Pa.—C. A. Ben¬

The

company

sold ,$25 million

bonds in May 1957, and the same
amount in February 1958. It still
needs about
to take
and

$7.5 million new funds

care

of the 1958 program,

this will

probably be raised
through sale of preferred and/or

Co.,

-

This rela¬

tively low yield seems to indicate
expectations of a dividend in¬
crease (the next meeting is early
in October). The present payout
ratio is only about 58% versus a
general average of 72%, and the
dividend

rate

has

not

been

in¬

creased since 1954.

stock around the end of

common

this

early next year.
financing
include
it is conjectured
that the amount might be in a
range of l-for-10 to l-for-15.
CHICAGO, 111.—The Municipal
Capitalization as of Dec. 31, Bond Club of Chicago will hold ita
1957, pro jorma for the $25 mil¬ annual field day at the Elmliurst
lion bond issue of February 1958,
Country Club on Sept. 12. A din¬
year

stock

common

was

as

Chicago Municipal Bd.
Club Outing Sept. 12

or

this

Should

follows:

Millions

Debt

Mortgage

$J61
13

Debentures
Prelerred

<

Stock

Common Stock

Percentage

50 #
4

33

Equity™

]2

109*

34*

$321

Total

100#

million representing
amortization of emer¬
gency facilities, and $2 million reflecting
tax savings due to accelerated depreciation.
If
these were excluded, the equity ratio
would approximate 31#.
•Includes

tax

savings

about

$6

ner

will

precede

the

event

on

Sept. 11 at the University Club.
Carl H. Oilman, Dean Witter &
Co., is general chairman of the
outing; chairman of the committee
on
arrangements
is
Oliver H.

Heighway, Hornblower & Weeks-

from

year's peak load was 756,capability of generat¬
ing plants approximated 766,000
ing, to engage in a securities busi¬ kw, providing only a small re¬
ness.
Officers are Carl A. Benson, serve.
However,
completion of
President; Peter A. Lagi, Vice- the 150,000 kw unit this fall will
President.
Both were formerly
improve the reserve.
The com¬
with Anglo-American Securities.
pany expects to obtain an alloca¬
Inc.
tion of power from the Niagara
River
Project now being con¬
structed by the New York State
Three With Inv. Service
Power
Authority, which is ex¬
(Special to The Financial Chronicle)
pected to begin deliveries around
In the interim, until
DENVER, Colo. — Hubert R. mid-1961.
Miller, Josephine E. Miller and Niagara River power is available,
Gerald
H.
Williams
have
been the company has reasonable as¬
added to the staff of Investment surance
that any deficiency in
Service Co., First National Bank reserve capacity in 1960-61 will
be taken care of by power avail¬
Building.
&

Inc. has been formed
with offices in the Empire Build¬
son

for 24 electric utilities.

a

year.

a

policy,
(spending, taxing, and borrowing

was only reversed with great ef¬
promotion of fort and only this spring began to
growth in free economies is that show up.

establishment

tween this

fiscal

of

activities of the Federal Govern¬

ment

Monetary

of

products,
Allowing for 30c more of they
products,
8%
rate increase (six months at 5c
from
office equipment,
and
share earnings for
deposits. The agency most directly celerator mechanism) one would smaller percentages from foot¬ per month)
the calendar year might approx¬
and importantly concerned with expect that expansion in refinery wear, mining, food, drugs and a
imate $3.80. At the recent price PC
the regulation of the money sup¬ capacity would slow down and be large number of smaller indus¬
48, the stock would be selling at
ply of the United States is the in some degree a byproduct of tries.
only 12.6 times such earnings;
Construction
Federal Reserve System. The Fed¬ modernization. In fact this is what
expenditures for
eral Reserve System controls the is happening. A close relationship 1957 approximated $37 million, a However, the earnings include an
estimated
41c
for
income
tax
supply, cost and availability of has existed between capacity and record high (while gross additions
demand
and
crude
runs
since to plant were slightly larger in savings resulting from accelerated
bank credit:
depreciation.
A majority of the
World War II. Currently, refining 1953, this included certain prop¬
(a) Through the amount it re¬
electric utilities "normalize" these
capacity is being utilized at about erty acquisitions).
Expenditures
quires member banks (banks you
80%, as compared with an average by the electric department in¬ earnings—i.e. exclude them from
ordinarily deal with) to have on
share earnings,
With such nor¬
of
88%
in
non-recession years creased 53% and gas 42%
over
deposit with the System,
the
1958
estimate
1956.
since World War II.
These increases were due malization,
(b) Through the interest rate on
would be reduced to about $3.40,
Oil demand is affected by the largely to construction of a new
loans
to
these
member
banks
and the price-earnings ratio
on
recession although each product is 150,000 kw. steam generating unit
(called the rediscount rate),
this basis would be 14.1—still ore
affected differently. Gasoline, e.g., at the Milliken Station, expansion
(c) Through buying and selling
the low side as compared with,
of gas facilities to serve additional
fairly impervious to income
U. S. Government securities in the is
current ratios of 15 or 16 for nonchanges while residual fuel is communities, etc. Expenditures in
open market.
1958 will be a little lower, being growth electric utilities.
very sensitive to changes in in¬
The
Federal Reserve has re¬
-Based on the dividend rate of
estimated at $35 million; those for
dustrial activity.
duced its rediscount rate on sev¬
1959-60, with no new generating $2 the yield is 4.2% compared'
Prices
of
petroleum products units scheduled for
eral occasions beginning in midconstruction, with a recent average of 4.4%

The Business Outlook
with

was

able from the big northeastern
area
power pool,
which includes ten
State, including large utilities. It is estimated thai
large fann and dairying sections the
"Niagara allocation will take
(mainly in the south central por¬ care of
increasing requirements
tion) and important resort areas until 1963-64.
:
serves

nues,

business

has

New York State Electric & Gas
Corporation
New York State Electric & Gas

trial 21%.

own.

Demand

annum.

from

nation has

a

the oil business

pound

Continued

By OWEN ELY

a

While the

Stock

the

Utility Securities

re¬

any lost revenues by hav¬
higher tax base.
Of course, the argument against
this proposal and for a "steady as
we go" policy is
that this would
be unduly
inflationary and the
price level would run up more
rapidly.
Any near-term recovery which

ing

by other industries and especial¬ would be needed,) the company's
ly by municipalities for their present earnings could easily be
sewage
disposal. • Apilot plant doubled.
^
,r
successfully ; operated for more
The shares, without the Zim¬
probably will, occur.
J
than one-half year in Chicago mermann
Process, are attractively
and the company is now negotiat¬
priced for a sheltered security.
The Oil Picture
ing a contract with the city for With this process, I consider the

50 tons daily capacity each, which
could result in substantial savings

Public

that

later

trieve

system which eliminates
pollution caused by or¬ problems, the application of this
ganic waste, which for four years process has excellent prospects
has been in successful operation and since the company desires to
at
the
Hammermill
Paper Co. run this on a royalty basis, it may
This process is being installed at add very substantially to the com¬
Norway's largest paper company, pany's earnings in the long run.
enabling this concern to eliminate The company has received thou¬
purchases of fuel which is very sands of requests from interested
expensive in Norway. Its annual parties. If only part of this would
savings should amount to about materialize at the rate of the
45% of the total cost of the plant small Chicago plant, (to cover the
using the Zimmermann Process. £ total needs of Chicago, 10 times
The same process can be used the planned installation's capacity

ess,"

for

33

Rockford Sec Dealers

Annual Fling-Ding

Last

000 kw and

ROCKFORD, 111.—The Rockford
Securities Dealers Association will
hold their annual fling-ding on
Friday, Sept. 26 at the Mauh-NahTee-See Country Club.
Tab for

Reserva-*

golf and dinner is $15.
tions may be

made with James E.

Pence, Stone & Webster

Securities

Corporation.

With Filor,
Richard
come

P.

Van

Billiard
Horn

has he-

associated with Filor,

Bill¬

Smith, 26 Broadway, NewYork City,* members of the New
York Stock Exchange, as portiard &

The Commercial and Financial Chronicle

34

from page 10

nearly 5%.
did not recede like

Wages, Prices and Productivity

'

ment Association in New

at this

again
the

York, I
material along

I shall draw

these lines.

Bureau

has

that

on

addition,

In

time.

developed

existed in
a free market. They were obtained
by rigorous allocation and ration¬
ing and by the diversion of con¬
sumer purchasing power into war
bonds.
The wage and salary in¬
comes of the people were not per¬
mitted to express themselves in
prices. However, they were not
permanently neutralized. They
were set aside in war bonds which
were
cashable after 60 days of
couldn't possibly have

ference of the American Manage¬

some

These price levels

30%.

only

attempt to throw a little more
light on these problems.
Last September, before a con¬

some

productivity measurements,
were
briefly outlined in
the Economic Report of the Pres¬ holding. Thus there was created
ident, and which were presented a vast reservoir of consumer pur¬
more recently
to the Joint Eco¬ chasing power which had explo¬
newer

which

also draw

shall

on

war

r

manufacturing leveled
off at about $1.40 per hour and
weekly earnings at around $55
per week. There were practically
no cuts in wage rates during
the
1949 recession, although in some
sectors of the economy reduced
hours of work caused reductions
in weekly earnings. For the econ¬
omy as a
whole consumer pur¬
chasing power was well sustained
during the recession, aided by a

Business

spring of 1950 "when - the
outbreak in
Korea occurred in
the

based

sion

erated

1945-49

f began at the end of the
1945. Thus, 1 began in the

year,

problem had
bottled up during World
II by wage and price con¬
plus the selling of war bonds

war in

been

middle pf the wage-price story. To

War

get the whole picture, it is useful

trols

to go

to

back to the

It would

be

prewar period.
more desirable

even

wage-price

The

power. The government made an
effort to maintain some control

to go back to the 1920's, when we
in a period of prosperity,

over

but sufficient reliable data

conversion

were

are

not

available.

;

The Wartime Experience, 1939-45
A fully documented

history of

this period was published in Bu¬
reau of Labor Statistics' Bullentin
No. 1009

"Problems and Poli¬

on

purchasing

excess

up

mop

cies

of Dispute Settlement and
Wage Stabilization During World

the situation during the re¬

cessful.

this

but

unsuc¬

was

controls

Wage

were

active

load of wartime savings was con¬

Labor
ter

in the Bureau

of

Statistices; and to the chap¬
"An

on

Appraisal

Wage

of

Stabilization Policies" by Profes¬
John T. Dunlop of Harvard

University.

I

marize in

few

a

shall merely

sum¬

paragraphs what

they have fully set forth.

[ To begin with, 1939

sharp business downturn in 1937-

Consequently, when the

pre¬

business expansion began in
1940, there was both idle labor

war

^aad idle capital available for in¬
creased

production.

Therefore,
hotb wage rates and the price in¬
dexes remained relatively stable
for

a considerable
period of time.
Between August 1939 and Decem¬
ber
1940, Douty estimated that

wage rates in

manufacturing had

ri&m by only 3.4%.

period,
about

consumer

2%

and

demand.

verted

to

The

overhanging
into

extent

some

cur¬

purchasing power; business
obtain credit to expand their

rent
men

facilities;

productive

with

and,

deductions from wages

bond

war

longer needed, the current pay

no

price controls,
4 /%•..
: During this period a combina¬
-

tion

In that

same

prices had risen

wholesale

prices

nearly 7%.

Gross average hourly
earnings, however, had risen over
8%. If we take further into ac¬

In the same period the

17%.

rose

Consumer Price Index rose some¬

what

the

employment (4,700,000) was
reached
in February, the
Con¬
Price

sumer

unions

the

result

The

was

sharp

a

and

spectacular rise in prices, both in
the business world and at retail
to

controls

When

consumers.

taken off in the summer of

were

1946

prices literally jumped up.
Starting from May, 1946 whole¬
sale prices rose over 30% in one
year, and 44%
in two years to
May, 1948. Farm prices rose to
new

heights,

helping

thus

to

raise the consumer's cost of living
in

its

family's
food
years the
Con¬

earning

wage

budget.

In

two

Price

sumer

sector—the

sensitive

most

Index

about

rose

earnings

did

dent

that

whole

swollen

sumer

U. S. entered the
war, the pattern
of wartime economics became evi¬

dent—rising
power

consumer

purchasing

without

equivalent con¬
sumer goods to buy.
Without going through the de¬
tailed history of the war
years, I

shall merely summarize the situa¬
tion at the end of the war in 1945

(that is, the average for the whole
year). By that time average hourly
earnings jn manufacturing indus¬
tries as a whole had risen 61.6%
over

the average for 1939. Hourly

Earnings

further

behind.

elimination

overtime

of

war

February,

1946.

This

flation

clearly

by the reservoir
purchasing power and
by active business and

fed

demand.

consumer

prices

continued
on

the

44.5%.

lar

loss
on

in

the

balance, which
fied

versal.

Average weekly earnings




one

value

rise

in

increased
hand

of

the

and

dol¬

other brought about

manufacturing industries to show

by

The

until

the

that the wage movement

in manufacturing had risen
nearly

demand in¬

a

sparked

the

uni-

two

of wartime

then

a

readjustment.

The economy operated un-,

conditions, which

war

under

controls.

until; the-next, business recovery
begins
and
we
can
view
the
whole cycle.
VT
T' '

means-

.

-•

Business Recovery and Prosperity,

1954-57

J' :'

The
the

business

end

lasted

of

the

about

summer

of

A

a

of

1954.

in

war.

year

1953

the

-after

became

turned

down

busi¬

boom--of .-major
in 11957 and
autumn.

though

•

prices \

they

were .*

rough correspondencein their movements—
when prices rise
(as in 1946-48
or -1950-51)
wages-follow them
up, and when wages lead the way
(as in 1955-56) prices eventually
respond. However, it is evident
that the correspondence of wages
and
prices is T not
very;.; close,
either
in timing or
in rate - of
change. One major reason is that

off

last

as

•

is

there

course,

.-summer

private

a

wages

'

■■': ...'

directly related to each other. Of .;

the

business recovery was

leveled

■

Thus far we J-ave treated
and

by the .autumnof
During 1955 and :1956!the

It

,ivity

jPro*

,i,
.

Korea

-

irom

—

to

investment

size.

•

way

recovery
ness

;

downturn

We shall not be
appraise this period fully

able to

great

der

a

,

*

|
i
.*

I
"
f

;
During the four-?year period;
■
.3954-57, both hourly earnings and
weekly earnings moved upward, there is a third factor which in- ;
ahead of and well above, prices. tervenes, namely, productivity."
We
mentioned
earlier
of the ;
There was very little" change in
wages in the first eight months of wage rate (largely represented by '
1954, but when the business up¬ hourly earnings) as a measure of
turn began in the autumn, both labor cost to the employer and •
hourly and weekly earnings be¬ therefore an influence on prices. "
gan
to respond. 'Unemployment But the wage rate is not the only
in
an
had not been exceptionally high factor
employer's .labor !
the
preceding winter (peak Tin cost; it is modified by the number •]
March, 3,700,000) and by October, of manhours required to produce '
1954, -it was down to 2,700,000. a unit of product. The latter is.
Thereafter, hourly earnings rose one way -of expressing produc¬
steadily to the summer of 1957, tivity —I man-hours per unit oi)
when
they reached theirpeak, product. Higher wages per hour
approximately 15%<? above Janu¬ might be balanced by fewer manary,
1954.
Weekly earnings hours of work,; so that the labor
cost might remain the same and
reached their peak in 'the clos¬
If
ing months of 1956. During 1957 prices would be unchanged.
they declined sldwly/ due to the labor saving exceeds wage in-'
gradually shortening workweek.- creases, prices could be reduced.By the end of the year, weekly Therefore, in analyzing the wage—'
earnings
were- well
below
the price problem it is necessary to.
productivity - into account. '
corresponding month of 1956, and take
their purchasing power was down The great difficulty at this point <'
nearly 5% because of the1 rise in is that productivity data are not'
consumer
prices.
*
" " * *
.r nearly as complete nor as well '•
'understood as are wage and price In
contrast
to
wages, \ both
data. - Efforts are being made to;
wholesale
and
retail
prices re¬
> '
*
mained stable for the first 'two remedy this situation. ;
The BLS has recently released
years, 1954-55.
Wholesale prices
estimates
of
productivity which •
began to respond to the boom
1

-

-

.

in

fall within the framework of Gross

the

rose

autumn of 1955, and they
steadily during 1956 and the

first

half

risen

prices

sumer
move

1957.

of

they had

National

This

Product.

estimate, which

By that time

may

.

about' 7%.

did

not

ferred

Con¬

start

to

1956,1

until the spring of

up

when the CPI

had

it

to

net

as

type

♦

of.

also be re- ;
or real1

output

product per man-hour, reflects a r
number of things: changes in plant »"

was

been

higher than

no

nearly

four 'years
earlier, in the summer of 1952V'J

employment
had

the

re¬

several^ million
Wage
and
price

of

unemployed.
controls

the

by

been

introduced

in order to
problem of rising

deal

1951

in

incomes

the

in

con¬

fact

of

shortages of consumer goods.
During the last two years of
the Korean war prices were well
under
control. Farm prices
fell
back sharply from the peaks of
early 1951, and
the Wholesale
Price Index began a slow decline.
Consumer prices advanced slowly
to the
were

of 1952 when they

summer

stabilized

and

remained

at

certain

the

Farm prices

was

a

further forti¬

recession

of

1949.

fell nearly 20%?, the

Wholesale Price Index about

10%,

that level for the next four years.

Wages,

however, continued to
slowly until the

rather

advance

home
ownership costs—
persistently .. during
those

rose

Conversely,

years.

food items and

generally

declined

both

1956
an

end.

ward,
bottom

their

in

mainder

of

of

two

the index up
of

index

the

...

last

period of wage-price

relationships

(1954-57) is of

fluences

Since Korea the

were

up

-

three-year period,
tinued
1953.

to

Both

creep

23 %

but

over

and

adjustment,

a

and

the. Korean-pe¬

reflected wartime

all

directly

or

less

economy.

All controls

con¬

ished
years

after

indirectly.

influence

exercised

retail

in¬

Government has

the

during

they

upward

wholesale

of

The previous periods—r
War II, the postwar
re¬

1952,

December,

about

workings

spe¬

^represents
peacetime

economy.

—

We

have

prepared

indexes

of '

product per man-hour for the

years

total

.

1947-57 covering
(1) the
private economy, (2) agri- v

culture, (3) total nonagriculture,
(4) manufacturing. The data

and
for

1957

soon

subject

available.

The

1

are

as

1957 information be- '

more

as

comes

preliminary, and
to revision

are

therefore

index

'

,

"

the total private

for

and the addition economy is based on estimates of.
increases .sent ..Private Gross National Product.
(in constant prices) published by .
over 6%> by the end

cial interest because it

riod

•

real

new

all

Hourly

of

continued

1957.

This

,

-re¬

using in this presentation.

rise,

steady
these

discounting

durables. -'The

consumer

its

to

came

prices turned. up¬
retailers had reached

then fluctuated at about that level

1953.

Tor.

Farm

and

World

year

(except

factors

these

By December, (1952, weekly
earnings reached a peak nearly
30%<?
above
January, 1950, and

during the
earnings,
by

durables

fluctuations during each
However, in the spring of

year).

the

year.

of

prices

consumer

of 1952 and then quite
sharply in the second half of that

summer

the

seasonal

'

was

production

was

the

In

from May, 1946 to May, 1948
weekly earnings increased only
24.3%.

years

earnings in building construction

non-

pay

industries, the average
weekly earnings in manufactur¬
ing fell from $47.50 per week in
January, 1945, to $46.58 per week

wage

had risen 48% and in retail trade,

I mention these two

the

Due-to

and
the shift of workers out of high

in

picture changed.
The
wage contracts in
the

boom, and now

—

30%.

with

purchasing power was
under way. Thus, even before the

a

factor.

its own motion, created
is experienchiug

on

a

.

still

consumer

to

omy,

government

initiating factor and also
extent the dominating

the

was

the Korean period

which

in

one

productivity arising out of tech¬
nological change, and gains in*
worker and managerial efficiency; »
May, 1950, but there
was
little interest
in such con¬
shifts between plants; changes in i
The behavior of the Consumer labor requirements resulting from
tracts on the part of either man¬ v
Price
Index
during This, period
agement or labor in other indus¬
changes in material used for unit
is interesting, because it '.demon¬
tries. But after June there was a
of output; and shifts in the re¬
strates
the extent to whichits
rush into escalation and several
lative
importance o f industries
movements are governed .by fac¬
million workers were brought un¬
with
higher or i lower levels of >
tors not closely or directly
re¬
der it. By March, 1951-the. aver¬
productivity. This measure might:
lated to current • business condi¬
"show an iricrease~rn productivity..!,
age hourly earnings in manufac¬
tions.
The
stability which;-the for a sector
turing had gone up about 8%0, just
(or for. the total econ- ;
index
showed for several years
slightly less than consumer prices
omy) even if there were no change !
prior to the spring of 19o6 was in
had risen.
But weekly earnings
productivity of the component •
caused by the close, balancing of
had gone up about 11%, due as
industries. The Bureau has previ- t
two
opposing price movements.
usual to longer hours of work and
ously released other types of :
Certain groups of items in the
measures known as physical out-r
premium pay.
The volume of
index
the services, rents and
consumer
purchasing power was
put per man-hour Which I am not

a

in

little better

in

February,

expansion

a

automobile industry had been re¬

newed

hour in May, 1948—an increase of
about 23%.
Weekly earnings fell

rapid

only

But with the outbreak in Korea

unemploy¬

ment and the
of persons

by

Aver¬

(2.2%).

further

in

cautious.

was

de¬

age hourly earnings in manufac¬
turing rose only slightly (1.7%)
January to May, and weekly

escalator

once.

been

bargaining

from

the

of

for

had

Index

collective

clining,

lagged on this rise.
The average hourly earnings in
manufacturing rose
from
$1.07
per hour in May, 1946 to $1.32 per

decline

8%—only about

than

more

increasing numbers
drawing pay, it is evi¬

count

demand cou¬

world-wide

of

pled
with some
hoarding and
speculation send the prices of raw
materials
skyward.
In
the
10
months from May, 1950 to March,
1951 the Wholesale Price Index

the workers were
spending.
There
simply were not enough goods
available to satisfy all these de¬
envelopes

available

was a year

of depression, the aftermath of the

of wage and

familiar phenomena

mands at

sor

top of the pri¬
For the

recovery.

soon

chapter on "The Development of
Wage-Price Policies" toy Harry
Douty, who is now the Chief of
the Division of Wages and Indus¬
Relations

-on

in wholesale
after
the
war half the increase
ended
and
price controls were prices. This is another example
largely eliminated by the late of the time lag and sluggishness
spring of 1946.
Some few con¬ ordinarily shown - by the CPI,
trols
(rents, for example) were which does not respond rapidly
retained, but there was no longer to changes in business conditions.
anything to prevent purchasing
Wages were rising slowly in
power from expressing itself in spring of 1950. The peak of un¬

dropped

War W I refer particularly to the

trial

on

the economy op¬
under
war
conditions.
was
a
resumption of the

There

Recession—

conversion, Inflation,

When f presented the wageprfee discussion in New York last

government expan¬
war
needs was

A new

June.

In summary,

<

was

1954.

private

by

next three years

First Postwar Period—Re¬

The

Wages and Prices

Period—1950-53

recovery

industry began about the middle
of 1949 and was picking up speed
in

neutral factor.

1950.

under

Korean

The

in consumer

increase

$2 billion
credit.

when released. superimposed
post¬ vate business

a big factor in the
inflation.

This was

infor¬

that

possibilities

sive

nomic Committee of the Congress.

mation.

38.

Thursday, August 14, 1953

.

other, so that Government spend¬
ing, although high, has been a
The private econ¬

prices in 1953 remained stablq at
a level about 15% above January,

prices. Hourly

earnings in

theiess, these economic problems 86%, or almost half again as fast
are still
with us; we still have as the earnings per hour.
In the meantime, the Wholesale
worries
about inflation on the
one
hand and recession on the Price Index had risen only 37%
other; we must at , least try to and the Consumer Price Index
understand the workings of these
economic forces. This paper is an

however,

salaries,

and

Wages

presented

Index

Price

Consumer

the

and

Continued

I

.

.

(630)

Korea

Government

expenditures have

and

on

were

in

the

abol¬

recent

receipts and
balanced each

the

Office

of

Business

Economics

of the

Department of Commerce. ;■
agriculture is ob- '
tained from the same source. The
The estimate for

e s

t i mate

■based

Bureau

for

manufacturing is

previous

on

of

work

Labor

Statistics

the

of

with

preliminary extensions for recent
(See BLS Report No. 100) '

years.

The

man-hour

estimate for

the '

major;
subdivisions includes the time of;
all
persons,
including the self-,
employed, unpaid family workers,
as
well as all wage and salary'
private

workers.

economy

The

and

the

estimates

cover

Volume 188

Number 5768

v.

The Commercial and Financial Chronicle

.

hours

paid (plus hours of unpaid
workers), including paid
holidays, vacations and sick leave.

What

family

this

shows

is

that

1950

unit

hind

unit-nonlabor costs.

labor

costs

up

lagged

This is

not

Trends

in

Output Per

surprising because produc¬
tivity increased
sharply during
that first postwar period and ac¬
tual current prices in the econ¬

Man-Hour

1947-57-

.,

During the period 1947-57, total
private real product per man-hour
increased by 37% over the 10-year
period. This is somewhat less than

had-risen faster than wages.
During the next few years, 195153, employee compensation rose

3.4%

faster; than

cumulative.
agricultural^ sector of

per

The

year

omy

~

sult that

the

prices,

with

nonlabor

the

To

to
be¬

re¬

payments lev¬

be

be

concrete,

industry agement. They too

one

prosperous and

expanding;
another, stable but static; still an¬
other,
declining.
The ; manage¬
may

ments in these different industries

in entirely different situations.

are

Each firm must

its

costs

and

study its markets,

the

efficiency of its

operations, not in terms of aggre¬
representing

gates

economy,

whole

the

but specifically in terms

of the prospects in its own indus¬

are subject to
competitive forces and must gauge

the
imagination of most of us,
Although no one can foresee all

the prospects of the firms and the

the different types of
nological advances and

industry.
So

able

decisions

of

relatively

firms

novations

reached

industries
and

in

hundreds

by thousands

millions

of

of workers.

The

Excluding agriculture, the

ward

1957, because
preliminary.
'

too

gen¬

to

data

ucts

stage

The

fruits

lars

that,

research

of this multitude of

over

are

adjusted itself to peacetime opera¬
tions; then a slowing down during
the Korean war, 1951-53;
next, a
further sharpening

of the rise

What

I

have

discussed

just

relationship

and

1957

While

,

only 17%.

was

productivity

represented

long-run

an

than

trend

year-to-

same

nevertheless,

fluctuatmns,

year

the

as

,

is
better nonfarm
underlying- compared
omy;

as

postwar pattern makes
There

sense.

not

was

some

much

gain

in productivity during World. War

II, for obvious

This

reasons.

the

Bank's

to

come
into
general use,, neitf
businesses will have to be devel¬

oped

and

is

the highlights of

among

mistic

forecast

for

(1951-53) slowed
of

year

business

1955)

as

the trend, A

up

(such

recovery

is nearly always

good

a

productivity

year,
but the rise
slackens at the peak of the boom'

(1956-57).

There

is

yet

as

no

good explanation of the compara¬
tively poor showing ; of the last

and

in

1956

divergence.

there

other

In

tional dollars will go for
products
and services currently unkown to

R.

that

Dockson,
"

-

The

differences

tion

of

and

An¬

Los

metro¬

of

the

in

employment

have

little

minor
signifi¬

are

economic

and therefore tend to dis¬

cance,

credit the statement that the Los
economy

ance

compared

with non-agricultural

The study
which
was

found in other metropolitan areas,

prepared

the

Dr.

b

Robert

y

R.

as

a

as

whole.

a

Los

try

many

school of

the

i t y
of
Southern

v e r s

bal¬

employment
comparison,

if

not

better,

than

of the other centers.
If and when the day arrives
international

that

tensions

have

been eased to the extent that de¬

I seriously doubt that

years.

this

foreshadows

trend

for

future.-

the

capital. investment

lower

new

a

The

by

heavy

American

industry during the last few years
should express itself eventually,
probably in the next business re¬
covery.

■

-

.

'

sufpassed the productiv¬

now

The

next

the years

lgbor

of labor costs and

this

for

a

costs

orices.

of

in the analysis
comparison
over

step

of

The

price index used,
purpose is neither
the

Consumer

Price

Index

Wholesale

Price

Index

It

is

to

have

the

price

change
in

occurred

nonfarm

sector

It shows

non-

of

the

such.

estimated
private

the

the

rise of 28%

a

nor
as

economy.1
since 1947.

change in price, per unit
reflects the change in labor and
.

The

nonlabor costs per unit.

The unit

labor cost is average hourly com¬

pensation per dollar of real prod-

divided by real product per
man-hour, that is, by produc¬
tivity. It includes direct and in¬
direct wage payments to all per¬
sons
engaged in the production
of nonfarm product.
Note that agriculture is entirely
excluded
production, compen¬
sation and prices. Unfortunately,
pet

•

because

of the

ures,

it

here

the

is

employed

nature

necessary

of the fig¬

to

include

earnings of the selfand
the
independent

businessman.

We have

no way of
compensation
for their labor from the profits
of their enterprises.

separating

out

the

Nonlabor payments are lumped

'expenditures can be dras¬
tically reduced, the problem of

'♦

Union

maintaining

Bank

fact

that

this1

analysis
total

the

of

if

'different

a

the

to

has been
postwar

started

we

year,

1950

or

1940, for example, the lines might
appear in a different relationship
to

each

other.

geles Area will have

purchased

final

by

demand

producers

products. It
price
of
goods
and consumers.




kinds of business opportunities to
those who are alert to take ad¬

vantage of change and those who
are
sufficiently bold, to develop
and market new ways of doing
.

things

as

well

as

new

im¬

and

proved products and services for
consumers

and

'}

businesses.

Los

In the author's opinion, the
Angeles Area is well on its

way

to becoming the number

(3)

,

one

Concluding

(1)

The

presented

data

the outcome of

record
tion

Observations

of

economic

They

past.

the

forces

show

how

in

the

wages,

slowly than G.N.P. when the

prices, and productivity interacted
to produce the broad general re¬
sult for the economy as a whole
or for its major sectors. The out¬
come

was

not

achieved

by

pur¬

activity
by
labor
and
management in pursuit of objec¬
tives designed to bring about these
results. On the contrary, the data
show the consequences of imper¬
sonal forces operating in our econ¬
omy. These figures were not even
available for most of the period,
so they could not have served as
guides to action.
poseful

(2) -These broad historical ag¬
gregates may not be closely re¬
lated, or even applicable, to in¬
dividual

firms

or

industries.

The

the
average of rising prices and fall¬
ing prices. The earnings figures
reflect both high wages and low
wages, rising wages and lagging
wages.
Our productivity studies
general

price

indexes

are

increase in

an

births.

(4)

here

opera¬

continue

large
will

be

in

bracket

of the

the

The sections

(5)

in-migrants

child-bearing

between 20

and

35

age

years.

the

Area

with

in-migrants.

new

Employment

(1)

Those

challenge
of

the

Area

Los

area's

endeavor

economic

Angeles

to

stability

Metropolitan

favorably with the distribution of
such
employment in the entire
United States.

is

Area

Angeles

approximately 120% to 148% over
the next 17 years.

actually declining. Amidst such
diversity there is no simple cofh-

has

a

smaller

share

of

mon

rule which

where.

can

apply every¬

On the other hand,
larger share of the nonagricultural employment in the
manufacturing and service indus¬
as

it

a

and

are

to

The certificates will be secured

by new standard-gauge railroad
equipment estimated to cost mot
less than $3,262,500.

Other members of
group

include:

Dick

-

•

the offering

&

Merle7

Hutchinson & Co.

ing and, thus, increased sales of
durables, fion-durables and serv¬
ices
in
the
Metropolitan Area.

John B. Glover, III, Forms

personal income in the
Los Angeles Area can be expected
Average

Smith;

R. W. Pressprich & Co.;
&
Co.; and McMaster

Freeman

Own Investment Co.
POMPANO

BEACH,
Ma. —
Glover & Co., Limited has been
approximately $2,500 before formed with offices at 7 Southeast
taxes to a range of $3,300 to $3,800
24th Avenue to engage in a securi¬
by 1975.
ties business.
Partners are John
(6) Homes, appliances, swim¬ B. Glover, III, general partner,
ming pools, recreational facilities and Howard O. Haines,* limited
the

1957

automobiles

will

from

increase

and

new

even more

In

income
to sell

of the

mass

a

level

enjoy partner. Mr. Glover was formerly
a partner in J. C. Wheat & Co. of

market by

this

addition,
will

on

mean

increased Richmond.
opportunities
new prod¬

large scale

are

still in the research

stage.

New Businesses

whole.

has

Commission

priced to yield from 225%
4.10%., according to maturity.

(5) A rise in income of the
magnitude projected will mean
more money available for spend¬

1975.

The Los Angeles Metropoli¬

Area

personal income in
Metropolitan
likely to increase from

Total
Los

Commerce

of

The distribution of the Los

(3)

(4)

alleged imbalance in the

Angeles Metropolitan Area's nonagricultural employment compares

tan

downturn.

the

to

economy.

(2)

a

base their contentions

often

upon an

who

the

national economy is experiencing

in the Metro¬

the greatest
amount of undeveloped land (such
as East San Gabriel Valley, North
Los
Angeles County, West San
Fernando Valley and Orange
County) will absorb a large part
politan

of

Equip. Trust Gits.

more

(3) For the most part, (approx.
85%) the population explosion in
the
Los
Angeles
Metropolitan
Area has been due to in-migra-

development

irtclodcs

un¬

duly optimistic but yet they are,
when compared to past perform¬
ance,
deliberately conservative.
(2) The future of the Los An¬
geles Metropolitan Area offers all

number

by 1975.

that

farm

presented

appear

In-migration is expected to
in large numbers and a

approximating 7,700,000 by 1965,
8,700,000 by 1970, and 10,300,000

and

costs.

projections

report might

Halsey,* Stuart & Co. Inc. .and
1935 through 1957, personal in¬ associates
are
offering
today
come in the Los Angeles Area in¬
(Aug.
14)
$2,610,000
of Great
creased, on the average, 1.6% for Northern Ry. 4% equipment trust
every 1% change in the national certificates
maturing, semif n«
output.
nually from March 1, 19,59 to
(3) It can be
expected that Sept. 1, 1973, inclusive. The group
business activity in the metropoli¬ won award of the certificates at
tan area will be accelerated at a competitive sale yesterday (Aug.
faster
rate
than
G.N.P.
during 13) on its bid of 99.08%, The cer¬
periods of an upturn in the na¬ tificates are being offered sub¬
tional economy and it will decline ject to approval of the Interstate

ucts

direct

this

For the entire period from

show that some industries may be it wage and salary workers em¬
as the remaining factor
price determination. They achieving spectacular technologi¬ ployed by all levels of govern¬
include rent, interest, profits and' cal improvements while others are ment than does the United States

excludes

:Sd

(2)

tion rather than to
Some

population

a

the

It

,

Halsey, Stuart Group

in

1

cars

full

together

other nonlabor

of 71%.

(1) The
in

4%

attention

call

should

I

determination

the

in

of

Offers Great Northern

with
consists

estimated

number

.

period.v Obviously,

Prices

and

is

metropolis of the world. Whether
employment in this is
accomplished in this cen¬
ity of "that; sector. We are not .as
consulting economist, looks ahead the absence of such expenditures
tury or the next will depend upon
yet' able to 1 carry these figures
will be a problem of the nation
through 1975.
the accumulated contributions of
forward to 1957. .>
0,..
Following are excerpts from the as a whole, not of the Los Angeles
each generation.
:.a
■
When we compare nonfarm study:
Metropolitan Area alone.
compensation with the productiv¬
Population Trends
Personal Income
ity of the- total private economy,
(1) One of the major reasons
which
includes
agriculture,
we
(1) Since 1950, personal income
why markets have mushroomed in
find that productivity was ahead
in the Los Angeles Area expanded
the Los Angeles Area has been the
for the entire period, and in 1956
at the rate of approximately 2%
rapid increase in population.
the two lines were coming much
fof each 1% change in Gross Na¬
(2) It is expected the Los An¬ tional Product.
closer to each other.
tor

in -terms

Costs

it

General Observations

fense

California" and

Dockson

R.

Robert

of

the nation,
compared

Angeles Area appears to

well,

as

(4)

com¬

at Uni-

merce

out

to

fit the pattern of the entire coun¬

fessor

in

is

When

meaningful

more

Dockson, pro¬

a

sec¬

Angeles

Bank.

up

total

u>

distribu¬

July
9, by Union

area

released

increase,

the

using the streets by 1975 will be
around 4,800,000 compared to an
estimated 2,800,000 in 1957, an in¬

:

two

jobs filled.

new

spending to keep pace with
the higher levels of
income, it can
be expected that billions of addi¬

tries than does the entire country.

opti¬

an

politan

econ¬

compensation in the nonfarm

through 1975.

future

geles

sharp
words, real

was

the
the

repre¬

that

area

population increases
incomes are

by the dislocations, of
through 1953 real compensation in
reconversion; so 1947 was not a
the
private nonfarm sector fol¬
good year.
But industry imme¬
lowed closely but remained below
diately
began
a
"catching-uo":
the- productivity
of that sector.
period, just as it did in the early
1920's after World War I.
Then However, in 1954 the lines crossed
the shifts and dislocations brought
about by the- Korean
hostilities

many

For

.

Robert

economist,,

higher personal

earnings of these

shows

in

development work
past 10 years will take
the shape of new producer and
consumer products.
If these are

crease

and

Index.

What' this

consulting

•/;

Continued

deflated by the Consumer

persons

invested

and

the

greatly

projects dynamic growth pattern for Los Angeles metropolitan

in that

compensation

the. actual

Union

economy

to- productivity

Real

sents

followed

of

the private

sector and in the total

Price

was

sector

billions of dol¬

been

it is not expected that
the per capita use of automobiles
in the Los Angeles Area will

Of Los Angeles

productivity

in

employed

persons

is
in¬

Use of Automobiles

of output. 'Another way of looking
in! at these two items is
.in a way

1954-55; and finally, a pronounced, which frequently referred to as
slackening in 1956-57. Thus,, for "sharing the gains" of productiv¬
total nonfarm, nearly half the en¬
ity. For this purpose we want to
tire rise occurred by
1950; in compare real compensation with
manufacturing the gain by 1950
productivity
to
show
the
real
was
13%, but the additional rise compensation per man-hour of the
to

the

it

many

While

wages-to labor costs per unit

of

of

1975,

forthcoming.

the average consumer.

is

the
»

to

that

be

have

tech¬

prod¬

V:;'

.

Compensation'and Productivity
•

prior
will

new
new

the market¬

reach

certain

na¬

eral picture of productivity in the

postwar period is as follows—first,
a sharp rise,
1947-50, as industry!

will

tional aggregates are only the sta¬
tistical summation of the results

,

*

that

prices, wages, and produc¬
tivity are determined first in the

decisions.,
private economy showed a much eled off. Tn 1953 the two were
In my judgment these historical
try. The state of general business
higher gain than the remainder; i about in balance. The labor costs conditions
may be a factor in a data can serve as a useful tool for
output per man-hour in agricul¬ leveled off again, due primarily firm's
decisions, but the success or general economic analysis. They
ture rose to a level nearly 84% ; to the
high productivity of 1954 failure of an enterprise will be provide information which may
above 1947, an average oi over 6%
and 1955j but the situation was
determined by its own competi¬ enable us to interpret recent eco¬
a-.year, cumulative.
By contrast, reversed once more in 1956 when tive
position and that of the in¬ nomic developments, appraise eco¬
the
nonfarm
sector gained
only ehip 1 oyee compensation
rose
dustry to which it belongs. In this nomic policies, and judge the per¬
28.6% over the period;- Manufac¬
above the price line for the first
respect the workers in an indus¬ formance of the economy as a
turing output per man-hour rose time in the postwar period. "We
>•
•;//
try are in the same boat as man¬ whole.
somewhat more, (32.4%) than the- have not carried this analysis for¬
remainder of the nonfarm sector.

35*

(631)

Two With Columbine
(Special to The Financial Chronicle)

DENVER, Colo. — W. R. Hen¬
dricks and James H. Sneed have

type of growth described become affiliated with the Colum¬
.this
report
is
filled
with bine Securities Corp., 621 Seven¬

The

a

in

promise

and

opportunity beyond teenth Street.

t

36

The Commercial and Financial Chronicle

(632)

Continued

Mays Acting Director

retiring

since

Commission
the

Aug.

Steel

"National

for

The main, reason

Commercial

(Special to thk Financial Chronicle)

was

Last

merly with Kirchner, Ormsbee &
"Wiesner, Inc.

1939 when

-

There

watched-

up

-;

gains

a

&

child di©

-

Competition has been so keen that many
their prices in the face of steadily rising costs. ♦

have had
' '

to

They

season.

not revised in 1957.

were

American

The

operating
capacity

rate

the

for

Iron

steel

of

Steel

and

companies

announced

average

week

;

see

for

doctor who

a

{ enough

in

mak•

''Index of

again, Doctor?"

...

.

lor

\

ago.

n

victim of

cancer.

We had succeeded

in pro¬

longing her life by many months
i —-thanks to

recent

time

*

day

is

a

advances in

as

disease that ranks

can

•.

Loadings of
were

ended

1958,

output increased

.

and

Trends from
year

1957 continued

four

in

in

even

52

in

regions,

one.

>

to

the

be mixed.

declined

previous

Casualties

slightly in

four

The most noticeable rise from

appeared in the Middle Atlantic States.

wholesale

a

"

"r'

*

Weej^Befo£e

food

general trend of food prices at the wholesale level.

Wednesday of last

South

Central —3

—1%.

•

.

week

to

\

Purchases

was

from

1%

below to

3%

higher

and East North Central

+3

./

.

\r.

.

..

States —5 to

•

women's summer sportswear and dresses was
high level and interest in fall coats, dresses and
suits improved.
Over-ail sales of women's apparel slightly ex¬
ceeded those of last year. While volume in men's sports coats and

sustained

by 88,-

at

of

a

climbed

appreciably,

beaehwear slackened.

in

There
ture

the

the call for lightweight suits and
was a substantial gain from a week
children's back-to-schcol merchandise,

There

buying of

revenue

help
Automotive

duce

Output in August Expected to Decline by
45% Under July's Volume Due to Widespread
production

for

the

week

62,846

(AMERICAN

Aug.

8,

1958,

crease

of

There

new

at

models.

and trucks

units above

Last

week's

amounted to 81,563 units, or an in¬
of the nrevious week's output,

that

ened

output advanced above that of the previous
3,579 units, while truck output dropped by 1,138 vehicles
during the week. In the corresponding week last year 118,864 cars
and

V*

v

>

w

'

in

car

18,279 trucks

were

18.279

a

bedroom sets, uphol¬
Appliance dealers re¬
ago in volume in air con¬

were

sets.

year

Volume

in canned

previous

a

year ago.

goods, frozen

foods,

Some retailers reported limited
juice concentrates.

in

furniture buying last week
City, Denver and Minneapolis. Bookings
year ago. Best-sellers were bedding, occasional

upsurge in wholesale

Kansas
a

during the week.

women's fail sports¬

skirts and better dresses. Over-all volume slightly exceeded
that of last year. Chicago wholesalers reported moderate year-toyear gains in the call for fall millinery.
Orders for, children's
back-to-school clothing expanded and equalled those of a year

wear,

assembled.

Last week the agency reported there were
15,138 trucks made
States. This compared with 16,276 in the

the United

week and

dinette

An appreciable rise occurred in orders for

week by

SOCIETY X

goods.

was an

markets

states "Ward's."

CANCER

and

tables and juvenile merchandise. Although attendance was below
expectations, orders taken at the New England Curtain and
Drapery Show were close to those of the similar event last year.
Purchases of air conditioners and other major appliances slack¬

output totaled 66,425 units and compared with
in the previous week. The past week's produc¬

cars

2,441

baked

matched those of

car

(revised)

tion total of

and

stocks of frozen

ended

tions and headed into factory changeovers on
Last week's

Best-sellers

the similar period last year.

and

according to "Ward's Automotive Reports," advanced somewhat,
despite the fact that manufacturers proceeded to wind up opera¬

CANCER*

local post office.

chairs

fresh meat and poultry was close to that of both the prior week

Factory Closedowns
Automotive

week.

tables and

ditioners, fans, lamps and television sets. Numerous "white sales"
helped boost volume in linens slightly over last year. While inter¬
est in floor coverings rose noticeably from the prior week, the
buying of draperies and slipcovers lagged.
Total food sales remained moderately higher than a year ago
again the past week. Grocers reported appreciable increases in
the call for most dairy products, cold cuts, ice cream, fresh pro¬

for the week ended Aug. 2, 1958, totaled 622,204
decrease of 118,504 cars, or 16% below the corresponding'
decrease of 38,083 cars, or 5.8% below the cor¬
responding week in 1956.

■of

appreciable year-to-year gains in sales of furni¬

the

ported moderate declines from

freight for the week ended Aug. 2, 1S58,

14,503 cars or 2.4% above the preceding week.

Americans thit

were

during

stered

Loadings

enemy




from

East South Central, Mountain and Pacific Coast —2 to 4-2; West

1957 week, and a

year alone.
Send your gift to

Aug. 9,

concentrated in the Pacific
80

ing percentages: South Atlantic States +4 to -f-8%; New England
and Middle Atlantic -1-1 to +5; West North Central —1 to -f3;

cars, a

»which will take the lives of mort

your

week

to

than a year ago, according to Dun & Bradstfeet.Tnc.
Regional
estimates varied from the comparable 1957 levels by the follow¬

Period in 1957

j erously to the American Cancel

9/9

on

Preceding Week But Were 16% Below Like

Let's give... boldly, gen-

250,000

the

it

mortal

.

was

clilfibVd

particularly girls' dresses and skirts.

ttriving towards that goal.

than

weekly production
• ;;, ■
.v
- ..%;■■■

>■.

■

increase

casualties

fractionally exceeded tliat of a year- ago;' There was
another slight decline in sales of new passenger cars. Volume re¬
mained noticeably below a year ago. spot estimates show;: :: .':i«
'The total dollar volume of retail trade in:the::period ended

Car Loadings in Latest Week Rose 2.4% Above the

Research, supported by tht
American Cancer
Society, it

,

average

47

retail trade

I'•:

earlier

•

over

..

on

-

000,000 kwh. above that of the week ended Aug. 11, 1956.

to-

It, and win

Society Crusade

128.4%.

production is based

pro¬

the actual weekly production

slacks

find ways to battlft

eliminate this

*92.2% and

to

In

Trade Volume Showed Expansion the Past Week

high level. The previous record high was set in the week
1958 when output reached 12,619,000,000 kwh. -

For

we must...

,

or

was

construction

15.

Attracted by extensive sales promotions, shoppers;stepped up
their buying of apparel, furniture and linens last week and total

000,000 kwh. above that of the previous week, and 637,000,000 kwh.
over that of the comparable 1957 week and an increase of
1,177,-

the Number 1 diseaso-

killer of children. We

from

'

ended Aug. 2,

But that's not
enough! Can-

cer

ago,

1947-1949.

the treatment of leukemia.

;

year

the week's

last

show the

to

The amount of electric energy distributed by the electric
light and power industry for the week ended Saturday, Aug. 9,
1958, was estimated at 12,707,000,000 kwh., according to the Edison
Electric Institute. Output in the past week established a new all-

fade from the sunlight of life——
1

33

Higher in wholesale price the pastweek were-lard;; butter; and
Lower were flour, wheat, corn, rye,- - oats,: barley, hams,
coffee, cottonseed oil, eggs, potatoes ^steers • an&fidgs. ^4^4 £'<-&%)
The index represents the
sum)dtaEof-tlie'pwce
raw foodstuffs and meats in generaLuse.ancl its chief: function is

Electric Output Registered New All-Time High Level
For Second Straight Week

child

a

to

cocoa.

even

.

tragedy

sees

to watch

month ago the rate

a

placed at 2,062,000 tons,

was

.

service

from 124,

price index, compiled vbyr. Dun f& Bradstreet, Inc., slipped somewhat last week;VOn- Aiig:. y5-It declined
'0.6% to $6.59 from $6.63 a week earlier, but was 3yl.%^hi'gher than
the $6.39 of the similar date a
yeaiSagd^
'•;%i'* *•

.V 4

duction 1,481,000 tons. A

of

It's terribly hard

141

Following Fractional Gains the

of steel j

before.

For the like week

this child
She was too weak to speak
eight. But

It.

to

Wholesale Food Price Index Last Week Eased Somewhat

1958 annual capacity of
140,742,570 net tons compared with actual production of 58.8% the
week

well

.>.-.4: * ;

-

-

rose

dipping to 95 from 110 and the East North Central total to
above

utilization of the Jan. 1,

of the

of

year ago

Output for the week beginning Aug. 11, 1958 is equal to about

me

-

commercial

regions and held

week

a

-

More businesses succumbed than last year among manu¬

The

the

:

and 36 in

ago

held

from 43.

ran

ago.
was

•

*
}

;

un-

Mild upturns occurred in four other

36

beginning Aug. 11, 1958, equivalent to
1,656,000 tons of ingot and steel castings (based on average week¬
ly production for 1947-49) as compared with an actual Vatc of

61.4%

plain to

week

a

where

total

cut

that

*103.1%

with liabilities

-

-

her eyes: "Can't you

rise among small casualties

a

regions including the
South Atlantic States, up to 29 from. 23. However, week-to-week
declines were reported in lour regions,;with the Middle Atlantic
'

>

Fifteen-per cent
comparable week of pre-war

week.

—4-

Institute

will

1*98.7% of capacity, and 1,586,000 tons

were

also

and

Most

Scrap prices continued their bullish trend last week. "Steel's"
on the prime grade jumped to $42 a gross ton, up $2.

the words

the

States

'

-

week

contractors and service enterprises, but wholesaling
steady with their 1957 level and retailing fell off
slightly from a year ago.
:
V
"

composite

■

40

failures

price hike may be on the way, the mazagine added. !
prices may be increased at the end of the 1958 shipping

ore

the

facturers,

Another
Iron

in

of last year.: Twenty-eight of the failing con¬
had liabilities in excess of $100,000 as compared with 26 in >

from 35.

.

•..

in

$5,000, which climbed to 50 from 38

While

Users are not applauding higher prices, but they are accept¬
ing them. While they regard the $4.50-a-ton hike as moderate,
they will have a hard time absorbing it. Their profits have been
steadily eroded since the recession began.
;

290

contrast, the
manufacturing toll dipped to 45 from 57 and wholesaling to 24

the end of the month, steel users no longer will be living
pantry, but will be ordering as much steel as they con¬
sume, continues this trade weekly.

mm

;

similar week

from

out of the

of cancer

and

and the 229 in? 1956.

ago

year

Retailing casualties

By

8

1.2%

week

252 occurred.

was

cerns

small, they are indicative of the market's latent strength.

are

previous

to

rose

,

demand is picking up in spite of higher prices.

Steel

jn

a

the preceding week.

.

.

,

industrial failures

the

week, steelmaking operations held at 59%

3.5 points.

amounted

Moderately to Highest

der

points; Birmingham at 54.5, up 2.5 points; Cleveland at 53.5, down
0.5 points; Youngstown at 52, no change; Pittsburgh at 51.5, up
1.5 points; Buffalo at 51.5, up 1.5 points; and Cincinnati at 44.5,

^I

the

Failures involving liabilities
of $5,000 or more increased
slightly to 240 from 233 in the previous week and 229 in 1957,

of capacity.
Production was about 1,593,000 net tons of steel for ingots and
castings. District rates were as follows: St. Louis at 83% of capac¬
ity, down 7 points from the previous week; Wheeling at 73.5,
no change;
Detroit at 68, up 1 point; Western district at 68, up
1 point; Chicago at 67, up 2 points; Eastern district at 60, up 2

for¬

and

businesses failed than

more

steel operations.

unlikely that capacity operations will be achieved, but fourth
quarter operations will be in the 60 to 70% range*

jr. K. Mullen Investment Cor, 621

the 265

ceeded

It is

ter has become associated with the

orders

below; shipments

below

4.6%

were

Aug. 7 from 271 in the preceding week, Dun & Bradstreet,
Inc., reports. At the highest level in five weeks, casualties ex¬

outlook is spurring the recovery underway
The uptrend will continue at a modest rate
through the remainder of the third quarter and into the fourth.

DENVER, Colo.—Dale H. Win¬

the
new

ended

in 1959, as against 4,400,000 this
for the increase is that fewer cars are in

The improved auto

in

to

period

same

Unfilled

2.3%

was

according

the

Level in Five Weeks

dealer hands at the start of the year.

With J. K. Mullen

orders

new

Business Failures Rose

will make and sell 5,500,000 cars
year.

He

production.

Production

In

above the like week in 1957.

put by 25%, "Steel" magazine stated on Monday of this week.
The metalworking weekly further declared that the industry

sistant Director.

Seventeenth Street.

above

16.6%

28.8%

61.4% of Ingot Capacity

the

and

production,

Barometer."

and

Production of automobiles in 1.959 will exceed this year's out¬

1955,

;

reporting mills in the week ended

above

Trade

stocks.

of

5.3%

were

Lumber

were

42%

to

Operations Expected to Increase This Week to

from

with

1958,

above

past 19 months has been As¬

.':£v..

2,

orders

and

Aug. 1, 1958, succeeding C. Wilson
Stale employment.
Mr. Mays has been

Thursday, August 14, 1958

.

Shipments Were 5.3% Above Production in the

Lumber shipments of 472

Industry

Newark, Del., assembly line, leaving only this division's Detroit
Evansville, Ind., plants active.
1

pointment of Dannitte H. Mays as
Acting Director of the Florida Se¬
curities
Commission,
effective

is

Lumber

5

The State of Trade and

TALLAHASSEE,
Fla. — An¬
nouncement is made of the ap¬

who

page

.

Week Ended Aug. 2, 1958

Of Fla. Sees. Comm.

Cogswell

jrom

.

Volume in men's apparel slipped from

a

week earlier and

fractionally below that of the similar 1957 week.

V Textile activity in most major wholesale centers lagged dur-

Volume 188

Number 5768

..

The Commercial and Financial Chronicle

.

(633)
ing the week. There

was

moderate decline in

a

trading in woolens

and worsteds in Boston and volume in
carpet wool fell
in Philadelphia.
Although some wholesalers

•

cloths, over-all volume

in

studying the trend of contribu¬
tions, analyzing the scope of giv¬
ing, forecasting cash needs of the

noticeably

reported

orders for sateens and print

scattered

in cotton gray

the

Federal

1958,

Reserve

Board's

a

country-wide basis

index

for

the

as

Among the companies cooperat¬
ing in the NICB study, requests
for

taken from

ended Aug. 2,
In the preceding

sponsored
smaller

was reported. For
Aug. 2, 1958, a gain of 3% was also recorded.
1958 to Aug. 2, 1958, a decrease of 2% was

the four weeks ended

to vest

For the period Jan. 1,

scored

sales

more

volume

in

New

York

.

'v

"•<•.

Best-sellers for the
sories and men's

week

piece

were

foundation.

the tendency is
an individual.

company

employees)
one

Regardless

typically

of

the_type of

directors, the NICB

Not

-

f

Asked

....

,

should

be

not

assumed

all corporate

companies

have

ma-

terially expanded their contributions

over

come

to

the

and

years

regard donations

of the costs of

have

as

one

new

which

of the costs of

This

;

_

attitude has led many
to
conduct
searching

new

companies

investigations of the basic
of

society

which

and

meet

the

of

these

needs

agencies

needs.

have resulted in

These

a

dollar

and

shifting in the

pattern of company contributions,

example,

Direct

often fail to measure

of

Joins

Story
dollars

other

analvcis

of

com-

the

totals.

is

In

not

reflected

in

(Special to The Financial Chronicle)

gift

with

co-

NICB

finds

that

assets

of

and

convinced

are

slake in the

that

success-

*

unmcflV a, Cr>
nomsey oc

au
(special to the

'nCOm° Company!

ful solution of the financial
prob-

for employee giving, use of
company facilities and equipment,
and sponsorship of selected organizations.

members

now

confronting colleges and
universities, particularly those
whose

is

support

private

derived

from

sources.

Exchanges.

IMr.

Baird formerly conducted his
business
buslness

own

South

m

Yarmouth.

Benefit

to

Social Welfare Gets Largest Share

Company

Expected

other endeavors which American business

The 180 companies
cooperating
in the NICB study gave $38.3 million in 1955. This was spread over
a
wide variety of agencies. Of

helps support — are not based
solely on altruism, The Conference

donations dollar, 40.1 cents
went to social welfare, 31.3 cents

Board

to

Company tumiiuuuuua-tucontributions—to
ucation

or

the

finds.

Policy
require that

usually
large

both

needs

and

provisions

companies,
small,
support

and

that have

causes

the

of

any

ed-

some

relation to

interests

the

of

business. Immediate benefit to the
company is not always demanded,
but
it
must
be
present,
even

though it is "long
acter"

or

range

in char¬

"broadly based."

Gave Away

0.7% of Income

study

with

ings,
1955

furnished

information

which

the

NICB

their

on

revealed

earn-

that

163

their

contributions averaged

of net income before taxes.

companies had

come

away

of

$5.1

a

0.7%
These

total net in-

billion

and

gave

$37.9 million.

However,

among

the

ratio

of

—

individual

contributions

several companies to 9.1%

machinery

to

net

ranging from 0.1%
firm.

in

Company

in

one

con-

tributions relative to income tend




and

cultural

2.1 cents to groups devoted
to "The American Way," 0.5 cents
to religious causes, and 0.3 cents
causes,

to

international

gifts.

A

(Special to The Financial Chronicle)

mond

has

Road.

category accounted for
4.6 cents, while unidentified funds
made up the balance of 7.3 cents,

He

With

become

It

was

affiliated

ff

With

few

exceptions,

the

co-

Square.

Mr.

La

previous contributions,

company,

received

and

recom-

within

earnings

foreseen, and intensified

Detition from fnrpiun

to fixing a limit
the

budget

they
In

use

a

addition

on contributions,
reportedly is helpful

mn„

S?iLf>e,expenditures on internaaugmented by United
?.tates
'!;a"SP0rtati0n'
s

BOSTON,

Wilson

Mass.

has

joined

Hutton

street,

as

Jar^er

tative.

Mr.

&

George

—

the

staff

net

during the first six months

of

and the estimate for the

year

1958,

Wilson

was

F.

a

record for net private

in

formerly

'
Passec* away Aug. 9 at the
64 while abroad.
A

n

foreign trade trends acted

Potter

A.

5

and

(2)

continuation

other

Government

under way.

now

of

defense

programs

In this

connec-

tion, however, the Group took
note

Middle

of

the

East,

but

was

T

,

,.

„

,

Jr.

at

age

&

1958 is projected in terms

mer-

exports of $16.4 billion;
foreign expenditures on American

services

and miscel-

$3.8

of

United

on

billion,

States for-

eign investments, including direct
and nortfolio investments and
eminent

loans

eov-

billion

q

SettiP°ssib*e er/?rs and omis-

.

iTthl
to

?n°° 7?°"

amount left for allocation

'

increases

dollar

in

foreign

gold ^andl
additions to

and

reserves

private

investments

and

the

on

of payments

_

(In Billions

17.8

of

economists

manufacturers, exporters, im-

sorters

bankers

fransnoutntioTt

p01lers\ Danl*erf' transportation

comPames, and other
rectly

engaged

in

concerns di-

international

trade and business.

of

•

.

,

of the United States

—

1958

Dollars)
Provis. Results

July 1958 Revised

1st Half 1958t

Estim. for 1958*

17.8

8.4

3.8

8.4

1.9

2.9

Total services

Total

erally in the role
with

Jan. 1958 Estlm.
for 1958*

investments

on

NFTC p0inted °Ut that ltS Bal"
anCe_
GrouP.1S com~
P°sed °f individuals serving gen-

..

International Transactions

Income

States is placed at $2.8 billion.

16.4

16.4

3.8

1.2

2.9

6.7

3.1

3.1

6.7

6.7

24.5

24.5

11.5

11.5

23.1

23.1

12.6

exports—goods & services?

6.7

merchandise

(adj.)

12.6

6.4

6.4

12.5

12.5

3.5

Military expenditures
Income on investments
Total

Total
Balance
Means

1.7

3.1

0.7

0.3

7.2

goods and

services

7.2

19.8

Imports—goods & services

on

of

3.5

3.0

services

1.7

19.8

transfers

3.7

7.2

7.2

10.1

10.1

19.7

19.7

+ 4.7

-

0.6

3.7

►

+ 1.4

financing balance:

Unilateral

+ 2A

(net, to foreign

[—] ):
(net)
(economic

—0.5
aid

and

Total

Unilateral

—0.2 +

—0.5

—0.8 +

—1.8

other
—1.8

Transfers

—2.3

—2.3

—1.1

age

of

Capital (net, outflow [—]):
Private capital (net)—

—1.9

Govt,

'I

—0.4

—2.5
loans and short-term assets——1.0

Total capital—

Total

passed
of

—1.1

—2.3

—2.3

U. S.

means

of

—3.5

financing

—3.5

69

—2.3

—5.8

—3.5
—0.7

—2.3

—4.2

—3.4

—4.2

—6.5

Foreign capital (net, outflow [—]) and
gold sales (purchases [—])
+ 0.7

+ 1.2

+ 2.8

Errors

+ 0.1

+ 0.3

—

the

of

chandise

Co.

and

omissions

+ 0.4

with

the securities
™as
™l, the securUies
urm of Biddle & Henry of Philadelphia.
was

in

concluded

far too fluid

impact

„

spe-

tensions

new

United States balance

Govt,

_

Potter,

billion^,
and changes

Utilization of dollars
currently
available to nations abroad
during

foreign

the

on

transfers)?

Charles A. rotter, Jr.
Aug

$3.5

countries

.

D

sbrocid,

^

Fahy

Marache

™

short-term assets
amounting to

capital

outflow from the United States.

represen-

Charles Harold Fahy, associated

Granbery

II

as

whole was raised from
$2.5 billion to $3.5 billion for net
new private capital investment.
If this
level is
reached, it will establish

Private

M

investments

and income

of

Co., 75 Federal

registered

a

Sl«

and government loans

laneous

capital
outflow
from the United States took place

new

to

to $1.8 billion, unilat-

travel, transportation

Canital Outflow Keonrd
Capital Outflow *e<>ord

Transportation, travel, misc. services

with Kidder, Peabody &
Co., and

away

cal-

lar United States
services.

....

ne

??,d a" °utfl°w °f $70° miUion'

lion, according to the Group
c
ations, while a somewhat

beavy

afd

ecraomk

amouS
amounting

t

lUGrchsndiSG trflde volume

-

the

y eral Private transfers of $500 milfactor.... lion; United States private capital

a significant

Tf

,f

from

come Paid to foreigners on investin this country; >$600 mi\r

com-

amirr>oe

? i

Commercial

Charles

report that
contribution budget.

^rfei

irx

This curtaiiment has been
sharper

than

shipments

lted ^ajesl of#3-1 billion; in¬

Imports of goods and services:

With W. E. Hutton

before

I

amount

A" am0unt of $26.2 billion 19
of «26'2 Million is

ofXver SfdS" ments

quence

was

the

More than half of the 180 firms
studied

imnnrtQ^hrn^H

ment of

(adj.)J

nrcvi0uslv with Gibbs & Co.

taxes.

of

.

laneous services;
military expenditures abroad (as distinct from

moderate curtail

a

Transportation, travel, misc. services

Fosse

Charles H.

of

ex

mean a drop of about military

Hayden, Stone & Co., 10 Post Of-

with

nature

"r

An

•
in Pvnm-tc

Exports of goods and services:
Commercial merchandise

Hayden, otone Co.

determining how much they will
give, the NICB reports. While no
single factor determines the
three most important determinants are the amounts

Group had esti-

^°Peai1 harYest

wouid aiso be

Schirmer, Atherton & Co.

the

.

Type of Transaction

operating companies have developed
their
own
yardsticks for

amount,

tZTLb ■

Suez crisis and the rela-

,

ii hiiiinn
v?-ir

<ci

with

BOSTON, Mass.
Aime P. La
p0sse has become associated with

E.

special

c

Company, 10 Pines
formerly with Ed-

(Special to The Financial Chronicle)

W.

are

computation^

inJanuarvofthSs vearGStl"
cou.ntries> composed of
d anticinXd that fhp piim $ 2V5 billl0nT .in commercial im¬
5
:,.the dim- ports; $3.5 billion expended for
such.special influences transportation, travel and miscel-

ward E. Mathews Co.

nce

the

the

Summarized

The decrease in
somewhat

that the situation
for its ultimate

REVERE, Mass.—Gene S. Ray-

miscel-

laneous

mendations

companies wide variation exists in
income

civic

to

Yardsticks of Giving Developed

One hundred and sixty-three of
the 180 companies cooperating in
this

cents to
3.2 cents

institutions, 10.6
medicine and health,

Security Program

of

Comprehensive Picture

1957.

gggj than"the

the

With Melvin Gordon Co.

every

educational

view

mated

cial

Melvin Gordon

Some

in

exports"is*1

and

®°.SA P

ministration of payroll deduction

lems

in

timated, should reach a value of
$12.5 billion, or about $800 million

Milk^treeu'Boston, jTttewSrld ^omtca^taaUo?
New York and

31
of the

■

public service advertising, technical and
clerical
assistance, ad-

financial chronicle)

SOUTH YARMOUTH, Mass.Harold R. Baird has become asso-

on

level of $16.4

a

H. R. Baird Now With

$100

causes is worth

Reed

,

million or more estimate that the
time their personnel spend in

Philanthropic

&

Illinois,

ganizations. Twenty-three of these
having

formerly
Inc., and
Company in Springfield,

Waddell

White &

operating companies contribute the
time of their executives and other
to assist nonprofit or-

the Mutual

run about excluded from

amount, $3.8 billion, should be
spent by foreign countries on simi-

Aim, Kane Firm

a

addition, 138 of the

at this time.
Exports of military end items under

Natl0nal foreign picture of
1958 American interna■LXeiae council.
tional transactions is
as
follows*
Commercial imports, it was es"ons
as 10110ws-

persoTat

company's
CHICAGO, 111.—Corey J. Mount
philanthropic effort, the has ioined the staff of
Aim, Kane,
NiCB notes. For example, the cost Rogers & Co., 39 South Lk Salle
of administering the contribution Street. Mr. Mount
was

program

a

to be assessed

.

total

Cooperating
companies
Other types of services conthey are deeply
con- tributed
by
companies
include
about the plight of higher donations of company
products,
a

among

records!

contributions

r,.,wd*

own

a lower percentage pany's own
and,
earnings than the small e* contact with ether companies and
soliciting agencies.

indicate

they have

their

practice

giving

^"17 educa«on,yin C?heSedpis! ^for^axes
cerned

develop

111

companies,

companies

contributions

education

engage

firms

of

decade.

to

philanthropy

inversely, with the large*

Dollars Don't Tell Whole

merchandise

pillion, according to the mid-year these transactions.
)
"
'<
J'aview of international transacAs seen at the year>s
mid-noint
t
^ of Payments by the Group, the comprehensive

Research techniques
freauentlv
emDloved
&re#

surveys of
companies

personnel

For

of

to vary
of their

States

rv.T? pelow 1957, at

program.

most

continuing studies are aimed at
developing optimum employment
the

A

number

research

they

notes.

attempting through

creative

more

response

NICB

growing
are

that

doing business, the

National
Industrial
Conference
Board reported Aug. 4 in
releasing
its latest study in company
giving
which took several
years
to

complete.

but

contributions
in

doing business.
American

the

companies

Several years study recently completed
by Conference Board

.

giving is in

requests,

small

Corporate Giving Rises With Shift to Education

United
,

re-

Companies Wait to Be

to

cne

lb? re^ yf *!? foreign trade for
Hje+
tbe year indicate
*

will

record for this
country.

new

u

All

It

a

+T

ports.

•

^

or

which, if realized,

establish

less than
a com-

with the chief executive

board of

above that of the like period last
year. In the
preceding week, July 26, 1958, a gain of 3% (revised) was re¬
ported. For the four weeks ended Aug. 2, 1958, an increase of
5%
was
reported.
For the period Jan. 1, 1958 to Aug.
2, 1958 an
increase of 1% was registered above that of
the corresponding
/ period in 1957.
:

as

01-

pan/s ''largest gifts" ordinarily
rests

1958 advanced 4%

attitude which regards such donations

or

have

concerned

person

contrftut?ons,"author?ty for

According to the Federal Reserve Board's index, department
store sales in New York City for the
weekly period ended Aug. 2,

expanded and reflect

the

acces¬

wear.

reveals company contributions have

In

with contributions.

a

•'

goods, women's

normally

authority in

than

more

City the past week

"2% to 4% gain above the volume for the like period

a

year ago.

are

Larger companies (with 10,000

reported below that of 1957.
Retail trade

contributions

handled by an
individual, a committee or either of the two in
combination
with
a
company-

week

3% above the like period last year.
week, July 26, 1958, an increase of like amount
rose

National Foreign Trade Council's
mid-year balance of pay¬
points up sharper drop in estimated U. S.
exports
for 1958 than
previously anticipated, and higher estimated net
capital outflow from United States
ments review

Organization for Company Gifts

Retailers stepped up their
buying of canned fruit, vegetables
fish last week.
Some wholesalers reported limited
stocks.
Interest in fresh produce, cold cuts and baked
goods was sustained
at a high level.
and

on

Exports to Decline 15% Below 1957 Level

program, and comparing contribu¬
tion
costs
with
other
company
costs.

goods slipped somewhat from the prior week. Automobile man¬
ufacturers stepped up their buying of
light weight coating fabrics
during the week. Incoming orders at Mid-Atlantic
dyeing and
finishing plants were unchanged from a week earlier.

Department store sales

37

Total

-

+1.1

+ 1.1

+ 1.3

+ 1.3

♦Estimated by the NFTC Balance of Payments Group.
tPartially
official statistics.
^Excluding military aid shipments or transfers.

+ 3.1

+ 3.1

estimated from

The Commercial and Financial Chronicle

38

.

.

Thursday, August 14, 1958-

.

(634)

ADDITIONS

* INDICATES

Acme United Life Insurance Co.,

1958. Price—$6.25 per share to share¬

holders, and $7.50 for any unsubscribed shares. Pro¬
ceeds—For working capital and general corporate pur¬

Underwriter—None.

poses.
•

Aircraft

Armaments,

Inc.,

Cockeysvflle,

Md.

July 16 (letter of notification) 70,000 shares of common
stock (par $1) being offered for subscription by minor¬
ity stockholders of record July 10, 1958 at rate of
seven new shares for each eight shares held
(with an
oversubscription privilege); rights to expire on Sept. 5.
An additional 280,000 shares will be subscribed for by
parent, United Industrial Corp., at the same price. Price
—$2.50 per share. Proceeds—To reduce its present short
term indebtedness and to procure production and test

notes,

a

debentures.

bearer

//.;,//>'/ ' /,

writer—None.

Dec.; 31, 1957.
The notes arse convertible at
time after July 1, 1958, until the maturity or prior
redemption of the notes at a conversion price of $4 per

Insurance Co.
258,740 shares of common stock (par $1),
of which 125,000 shares are to be offered publicly and
133,740 shares to employees pursuant to stock purchase
options. Price—To public, $6 per share. Proceeds—For
expansion and other corporate purposes. Office — At¬
lanta, Ga
Underwriter—None.

Bankers Southern,: Inc.

*

To

ville, Ky

derwriters—To be named by amendment.

July 16 (letter of notification) 18,461 shares of common
stock (par $10) being offered for subscription by stock¬
holders of record July 29, 1958 on the basis of one new
share for each 6.5 shares held (with an oversubscription

(N. Y.)

(par 200).
Proceeds — To
discharge current liabilities and to drill ten wells. Un¬

Mutual Investment Co., Inc.
Dec. 17 filed 490,000 shares of capital stock. Price—$10.20
per share. Proceeds—For investment in first trust notes,
American

second trust notes and construction loans. Company may
develop shopping centers and build or purchase office
buildings. Office — 900 Woodward Bldg., Washington,
D. C.
Underwriter — None.
Sheldon Magazine, 1201
Highland Drive, Silver Spring, Md., is President
American

Petrofina,, Inc., New York (8/20)
July 29 filed $6,950,000 of 5y2% subordinated convertible
debentures due Jan. 1, 1973, of which $5,000,000 prin¬
cipal amount are to be offered for account of Atlas Corp.,
and $1,950,000 principal amount are to be offered in
exchange for a like amount of 5 V2 % subordinated con¬
vertible notes issued June 30, 1958. Price—To be sup¬
plied by amendment. Underwriters—White, Weld & Co.,
Blyth & Co., Inc. and Hemphill, Noyes & Co., all of New
York.

in cash

or in State of Israel Independence Issue or De¬
velopment Issue bonds. Proceeds—For development and
expansion of agricultural, industrial and commercial en¬
terprises in Israel. Underwriter—None.

.

Apache Oil Corp., Minneapolis, Minn. (8/18)
July 28 filed 94,766 shares of common stock (par $2.50)
to be offered for subscription by stockholders at the rate
one

new

share for each four shares held about Aug.

18, 1958. Rights to expire on Sept. 2. Price—To be sup¬
plied, by amendment. Proceeds—For working capital.
Underwriter—Piper, Jaffray & Hopwood, Minneapolis,
Minn.

Arizona

Color

Film

Processing Laboratories
July 14 filed 500,000 shares of common stock (par $1).
A recission offer is being made with respect to stock
offered beginning April 8, 1958 to residents of the State
of Arizona.
Price—$2 per share. Proceeds—For land,
building and equipment, and working capital. Office—
Scottsdale,. Ariz. Underwriter -r- None. Statement ef¬
fective Aug. 4.

August
K/

$4,275,000

'

'

'

Oil

Apache




t
..

Merrill

Mortgages, Inc.

Co.-and

& Co.)

$296,750

'

"

Pillsbury Mills, Inc.-.
•Goldman,

and Piper,

100,000

Jaffray &

i

(To
Co.

*

; '

(Kidder, Peabody

Chemical

Thiokol

Hopwood)

Co.—_________—/.—Common

(Offering to stockholders—underwritten, by "Kidder,

•

-

Markets, Inc

*

S.

(R.

(Bids

„

r

'•

.
^

—Bonds

EDT) $60,000,000

'

<

(Tuesday)

Co.,

&

Inc.)

Preferred
$1,250,060

Co.___—Bonds

noon

EDT) $20,000,000

September 10

,

^

(Bids to be invited)

September 15

'

Gulf States Utilities

Bonds

$10,000,000

(Monday);

-

__Bonds

Co.__—_______

'

(Bids to-be invited) $17,000,000
Lines, Inc

I

Moore-McCormsick
Lofcb &

•Kuhii,

Co.

and

i

/

(Wednesday)

South Carolina Electric & Gas Co.^___

Equip. Trust Ctfs.

August 21 (Thursday)'

Lehman

Brothers)

»

^

;

Bonds
$24,pGQ.,000

..Common

Valet, Inc.

August

25

Bonds

PDT), $50,000,000

September 23

.

Consumers

August 26 (Tuesday )
Co.
noon

EDT)

..

September 30 (Tuesday)

—//Debentures
-

(Wednesday).

Aluminqm Co.—_
Podesta

&

Co.)

_

^Preferred
Common
"

(Offering to stockholders—ta be underwritten, by Eastman
Dillon, Union Securities, & Co.; Hornblower & Weeks; and
Winslow, Cohu & Stetson) 302,611? shares
.

Pennsylvania-Power Co.««———._w_,. —Bonds
$8,000,POO

;

stockholders—no

underwriting)

Southwestern Bell Telephone Co

Common

$70,09*4^60

Debeatures

(Bids, to be invited) $110,000,000'

——Common

EDT)

to

$1,200,000

Management Co.A.^

a.m.

Mountain States Telephone & Telegraph
Co
Coffering

'McDonald, Holman & Co., mc.) $400,000

Canada Dry Corp-._____

.Preferred

(Bids to be invited>$20,000,000

Debens.

Co., Inc..) $22,500,000

August 27

Bonds

(Bids to be invited) $40,000*000

Consumers Power Co.

$20;000,000"

Universal-Cyclops Steel Corp;

(Tuesday)

Power Co..

..

EDT) $40,000,000

a.m.

(A. G. Becker

.Bonds

-

...

'

Public Service Cq. of Indiana, Inc.—-Preferred
(Blyth & Co., Inc.) $24,282,600

(Monday^

Southern California Edison Co.
a.m.

(Wednesday^

September 17

102,566 shares

(R. S. Dickson. & Co.,, Ine.)

(Bids 11

r

_______

Dickson

Utah Power & Light

(Bids noon EST) $2,310,000-

Bankers

105,438 shares

Co.)

September 9
Stevens

Debentures

Ry

(Cruttenden,

/

(Tuesday)

Public Service Electric & Gas Co.

Arnold Altex

:

Com.

f

•

(Friday)

September 5

-

(Bids

r

$8,580,000

v

(White, Weld & Co., Blyth & Co., Inc. and Hemphill,
Noyes & Co.) $6,950,000,

(Bids 9

Co.)

&

.

V:

Petrofina, Inc.

One-Hour

,

North Carolina Natural Gas Corp.__Debs. &

August 20 (Wednesday)

(Bids 11 a.m.

-

-

„

(New Jersey)——....Common

Norfolk & Western

k V/

September4 (Thursday)

be offered in exchange for Humble Oil & Refining
stock—Morgan Stanley & Co. will act as exchange
agent) 11,406,078 shares

American

,

' ^

Co. )V $9,000,000

&

"

shares

19

!v
-

'

Peabody «fe

August

Paine, Webber,
White, "'Weld &

(Wednesday)

3

September

-Common

Sachs «fe Co.

F., Eber.stecit

/•••

ILL Santa Rosa Bonds

Rassco Financial. Corp.
—JDebenfures
(Rassco Israel Corp.) $l,00f),000

Common
lCopley

i

_

Pierce. Fenner & Smith;
Curtis; Smith, Barney & Co.;

Lynch,

.

on

$9$? and $1,500,000 of 5% subordinated: registered deben¬

\.-Vf c-.i5.-•''>%'

Grace Line

/;.

__Debs. & Common

—

Price—To be supplied

Associated Grocers, Inc., Seattle* Wash*
June 30 filed 4,788 shares of common capital stock (par

,

(Blyth Ss Co., Inc.; Lchnian Brothers; Allen & Co. and
Scharff & Jones, Inc.) 361,880 units

by amendment

Chicago, HI.

'•.■■■'

i

__Common

Corp

Houston Corp.

•

assignment of accounts receivable and warehouse re¬
ceipts; $40,000 for the purchase of additional equipment;
and the balance for general corporate, purposes; Office
—Miami, Fla. Underwriter—Cruttenden^ Podesta &. Co.,

'

x\ September ,2/'(Tuesday.)
v

(Offering to stockholders—to be underwritten by Piper,
Jaffray & Hopwood) 94,766 shares
:<"•

(BidS^ 11

Proceeds—$1,150,000? is, to be used: for
repayment of funds borrowed from James Talcott, Ine.,

■

■

New England Telephone A Telegraoh Co

vertible preferred stock (par $4).

\

(Monday)

—30

con¬

;////:;•';

caimdarWM^
Jackson'&

18

Montana Power

Arnold Altex Aluminum Co. (8/27)
Jtdy 28 filed 308,090 shares of 35 cents' cumulative

■;/>;£'./*"$;/;:;/.//

——Equip. Trust Ctfs.

iBids noon CDT)

Aug. 7 (letter of notification) 16,600 shares of common
stock (par $1). Price—$5 per share. Proceeds
For
working capital and general corporate purposes^ Office

Arlington St., Cambridge, Mass. Underwriter—None.

N.-M.

(Thursday),,. v.'/-!

14

Missouri Pacific RR

*k< Arlington Books, Inc., Cambridge* Mass.
—

(letter of notification) 300,000 shares of commonPrice—$1 per share. Proceeds—3
For working capital. Office —*937 Acequia Madre Rd.,
Santa Fe, N. M. Underwriter—Watson & Co., Santa Fe*
(par 10 cents).

'>•' '

Standard Oil Co.

Arden Farms Co., Los Angeles, Calif.
•
June 4 filed 172,162 shares* of common stock (par $1)
being offered for subscription by holders of outstand¬
ing' common stock at the rate of one new share for each
five shares held on July 7,
1958; rights to expire about
Sept. 22, 1958. Price—$14 per share. Proceeds—To pay
off an equivalent portion of the company's current bank
loans which, at May 15, 1958, amounted to $8,450,000.
Underwriter—None. Statement effective July 7.

.

Productions, Inc.

stock

'■'

August

i

II

June 30

NEW ISSUE

Anita Cobre U. S. A., inc., Phoenix, Ariz.

curities, Inc., Phoenix, Ariz.

'

common

—

go

Sept. 30 filed 85,000 shares of common stoek. Price—At
par ($3.75 per share), Proceeds—For investment in sub¬
sidiary and working capital. Underwriter—Selected Se¬

Seattle, Wash.

Inc.,

Jo rfijed; 1,000,000 'shares-of

Cinemark

Calidyne Co., Inc., Winchester, Mass.
•
June 4 filed 230,875 shares of common stock (par $1)
These share? are issuable upon conversion of an ag¬
gregate principal amount of $923,500 of 10-year 3% con-

14,700 shares of class B
Price—$12 per share. Proceeds

to selling stockholders. Office — 700 N. 44tb
Street, Birmingham, Ala; Underwriters — Cruttenden,
Podesta & Co., Chicago, 111.; and Odess, Martin & Herzberg, Inc., Birmingham, Ala.

of

>

exchange for oil and/or

Anderson Electric Corp.
stock (par $1).

V.-V

stock - Price—
At par. (10 cents per share)., Proceeds—For drilling
costs; Underwriter—None. Offering to /be made throughA. R. Morris and H, C. Evans, President and ; Vice-Presi-?
dent, respectively, on a best-efforts basis. Office—4112'
A rcade/ Building, Seattle, Wash.
/ - ;;:'
' /; ■ >: ; ;
July

properties and the class B shares to be issued as com¬
missions. Underwriter—Cador, Inc., Far Hills, N. J. :

Dec. 23 (letter of notification)
common

j/La/.;A.f..

~

Oils

Central

(par $1)
150,569 shares of. class B„ stock/.(par 60 cents), -the.
issued in

Inc., Metairie

Laboratories,

writer—None,

,

^ Cador Production Corp., Far Hills, N. J.
Aug. 7 filed 1,003,794 shares of class A stock

>

/J

July 2 filed 600,P00 shares of common Stock (par 10
cents), Price-$-$5 per share, /Proceeds—For/expansion,
working capital and other corporate purposes. Under¬

Underwriter—
Offering—Ex¬

pected late in September.

loans, to purchase and install machinery,
working capUaLt/Uhderwriters-^Eastman Dil¬

for

(NewOrleans)

ceeds—To be used in conjunction with proposed merger

shares to be

Aug. 26, 1958 on the basis of one

Carrtoiie

Budget Finance Plan, LosAngeles, Calif. ^
shares of -6%. serial preferred stpck
($10 par). Price—To be supplied by amendment. Pro¬

class A

(8/27).

Winslow, Cohu* & ;Stetson, all of New York. ^ t«Ki.

June 10 filed 132,000

and

Office—Toronto, Canada. Un>.
; V:: •» *
"y--" /; ,,

•;* %

lon, Union, Securities & Co,; Hornblower & Weeks, and.

privilege); rights to expire Aug. 21, 1958. Price—$14.75
per share. Proceeds—To repay short-term notes.
Office
St., Pittsfield, Mass. Underwriter—None. :-

Shearson,

The remaining

-

of bank

rnent

and

—20 Elm

Signature Loan Co., Inc.
Hammill & Co., New York.

1957).

new/share for '
rig^ht:< to expire on Sept.*11. Price
supplied by amendment. Proceeds—For repay- ;

—To be

Berkshire Gas Co.

of company and

16,

each JiveslVares held;

gas

• Ampal-American Israel Corp., New York
Aug. 8 filed $3,289,100 of 10-year discount debentures,
series E.
Price—61.027% of principal amount, payable

—To

of record

-V///;/-.

-■

Canada DryCorp.

e

v,

Feb. 28 filed 500,000 shares of common stock

American-Caribbean Oil Co.

selling stockholders.

derwriter—None.h - /•..r

r

Price—To be supplied by amendment.

Underwriter—None.

Dec/

100,000* shares* are to-be sold for the account ;of,4he Estate'?
of A. M. Collings Henderson on the American and To¬
ronto Stock; Exchanges.
Price^At. market. Proceeds— v

April 14 filed 8,934 shares of common stock. Price—At
par ($100 per share).
Proceeds—For general corporate
purposes.
Underwriter — Bankers Bond Co., Louis '

equipment.

,

v

'

quisition of all the assets of Yorcan Exploration Ltd.'
(latter proposes; te distribute said shares ratably to its
stockholders of record

Corp. (8/27)
400,000 shares of common stock (par 25
cents.) Price—$1 per share.
Proceeds—To reduce out¬
standing indebtedness and for working capital. OfficeHouston, Texas. Underwriter — McDonald, Holman &
;

;J

./*';

-

Campbell Chibougamau Mines Ltd. /
March lO filed 606,667 shares of capital stock (par $1),
of which. 506,667 were issued in connection with the ac¬

filed

/

Underwriter—None.

share.

Bankers Management

Co., Inc., New York.

Calidyne Co.,

limited partnership, which notes were assumed by the

any

Bankers Fidelity Life

10

ISSUE

REVISED

company

„•

Feb. 28 filed

Feb.

ITEMS

vertible subordinated income notes of the

second series, and $606,000 of 5% coupon
To be offered to members of the
association.
Proceeds —For working capital.
Under¬
ture

Atlanta, Ga.

315,000 shares of common stock (par $1)
to be offered for subscription by common stockholders
at the rate of three new shares for each two shares held
June 30 filed

of record June 30,

Registration

Now in

Securities

SINCE, PREVIOUS
e

...

October

1

(Wednesday)
—Debentures

National Fuel Gas Co
•

Bids 11:30

a.m.

October 21

EDT> $25,000,006

(Tuesday)

Cincinnati & Suburban Bell Telephone Co.. Debs.
.

(Bids to be received) $25,pOO,OOQ

■

Volume 188

Number 5768

The Commercial and Financial Chronicle

.

..

Columbia & Rensselaer Telephone

Corp..,
(letter of notification) ,.2,800 shares "of common
(no par) to be offered for subscription by stock¬

Aug. 4
stock

holders at the rate of
held.
of

Price—$60

*"*'•

''

"""

■

share for each 2.572 shares

'

r

4.

it

«■

"4

M-.T

•

7S,\

i>k

*

'r

is«

..*;•••

-

Commeree Ofl Refining Corp.— ^
16 filed $25,000,000 of first mortgage

'

■

j

'

Dec.

bonds due
Sept. 1, 1368, $20,000,00 of subordinated debentures due
Oct. 1, 1968 and 3,000,000 shares of common stock to be
offered in units as follows: $1,000 of bonds and 48 shares
'

of stock and

York.

;
*

Offering—Indefinite:

Consolidated Cuban

■

★ Cooper

& Co.,

Rochelle,

III.

Aug.;6 (letter of notification)) $100,000 of interim
ceipts, in denominations

of $2,000

each.

re¬

Proceeds—For

Ethodont Laboratories, Berkeley, Calif.
Feb, 20 filed 300,000 shares of common stock. - Price—
At par ($5 per share)/ Proceeds—To cover operating
expense during the development period of the corpora¬

program.

Far

>",(■

/

—None.

exploration
Hills, N, J.
,•/

;

-

Price—At par.: Proceeds—To be added to working cap¬
ital. Office—Ithaca, N. Y» .Underwriter—None.

.

Counselors

Feb.

5

cent).

♦

Underwriter

-

Louis.

convertible

Research

Price—At

market.

: Proceeds—For

Counselors

—

Research

f

•

Cuban-Venezuelan Oil Voting Trusts,

Havana, Cuba

.

■

Corp.,
.

St

y

—1820
■

to

N.

■

Fields'

Louisiana

July 31 filed 400 shares of
000

costs; and other corporate purposes.

*■

Curtis

1

■

(S»)

&

.

Underwriter—None

Son Inc.

*•"&»;;* « yj*

ceeds—To

.

holders at the rate of five
held
"•*22.
<

per

of

new

working
First

and/or

over

capital.

a

to

shares-for each 17 shares

Aug. 12, 1958/ rights to expire on Aug.
Price—$20 per share: to stockholders;*to public $21
share.-' Proceeds — To finance additional building,

Hoagland & Dodge Drilling Co., Inc.
27,000 shares of capital stock.

June 12 filed

Under¬

per

purchase the Belle-

Baton Rouge;

payment

for

improvements

in

part for

the ex¬

Price—To be sup¬
Together with other
funds, will be used to purchase the notes and common

plied by amendment.

Proceeds

stock of Coastal Transmission
mon

—

Corp., the notes and com¬
Corp., and 80%

stock of Houston Texas Gas & Oil

of Jacksonville

Gas Corp. common stock, and the bal¬
ance will be added to working
capital and used for gen¬
eral corporate purposes.
Underwriters
Blyth & Co.,

on

homes and secured by

mortgages or other liens upon the
Underwriter—None.

improved properties.

be used

debentures and five shares of stock.

Price—100% of principal amount. Pro¬
ceeds—To be used solely for purchase of notes and other
in

Proceeds—To

• Houston
Corp. (8/18-21)
July 3 filed $36,188,000 of subordinated debentures due
Aug. 1, 1968, and 1,809,400 shares of common stock (per
$1) to be offered in units of $100 principal amount hi

for equipment; and
Underwriter—None.

issued

share.

j

Price—$10

ploration of mines and development and operation1 ti
mines and in payment of indebtedness.
Office—1Tucson,
Ariz. Underwriter—None.
;;

Backers Co.v

indebtedness

cents per

management,
Proceeds—For

ceeds—For working capital. Underwriter—None.

tiples thereof.
-

to be sold at 25

incorporators,

ic Hathaway (C. F.) Co., Waterville, Me.
.j-,
July 30 (letter of notification) 22,404 shares of common
stock (par $1) to be issued
upon exercise of common
stock purchase warrants. Price —
$10.59 per share; Pro¬

12-year 6%

denominations

common

contract

are

organizers,

Price—$10 per share.
working capital and general corporate purposes. Under¬

bonds and

in

to

directors.

writer—None.

Inc., Clifton, N. J.
April 7 filed $1,000,000 of 12% notes, payable nine
months after date of issue in units of $100 or in mul¬

record

machinery, equipment, and'for workings-capital: Office
Sandy Hook, Conn. Underwriter—Smith; Ramsey & Co?,
Inc., Bridgeport, Conn.
' '? "

,

take

mont Motor Hotel

Price—At par ($10 per share).
purchase of outstanding stock of Roch¬

ercise of warrants which

Corp., Baton Rouge, La.

debenture

6%

.

July 18 (letter- of notification) 5,060'Shares of common
stock (par $10) being Offered for subscription by stock-

'

of

non¬

stock.

Cooperative, Inc. and for working capital.. Office
Centerway Road, Greenbelt, Md. Underwriter—

warrant

stock (no par) $500,$50,000 of promissory
notes to be offered in units of four shares of
stock, $2,000
of bonds and $500 of notes. Price—$7,500 per unit. Pro-

stocks (par

one-half cent) in each of 24
Cuban companies/Price— To be supplied, by amend¬
ment.
Proceeds—rFor capital expenditures,. exploration
t-

of

Street, North Miami, Fla.
writer—Dayton Co., South Miami,, Fla.

of

common

in

146th

E.

March 31 filed 767,838 units of voting trust Certificates
each certificate representing the ownership of one share

/

$165,000
offered

be

stock and 25,000 shares of class B

Guardian Insurance Corp..
Baltimore, Md.
Aug. 16, 1957, filed 300,000 shares of common
stock, of
which 200,000 shares are to be
publicly offered and the
remaining 100,000 shares reserved for issuance upon ex¬

$500 and $1,000 and 80,000 shares of common stock
(par 10 cents). Price—Of debentures, at par; of stock,
$1.25 per share. Proceeds—To reduce outstanding debts,
to purchase equipment and for working capital.
Office

a:

■'*.•■n-vv. viwuvJ*#/

debentures

common

None.

of

-

investment

Sales

Robert H. Green is President*;-

dale

—121

Corp.

★ Fibercraft, Inc.
(letter of notification)

common

Proceeds—For

Underwriter—Cador, Inc.,

Aug. 4

Fund/ Inc.,; St. Louis, Mo
100,000 shares of capital1 stock, (par one

filed

•

voting
voting

May 21 (letter of notification) 300,000 shares of common
stock (par 10 cents).
Price—50 cents per share. Proceeds—To make loans, etc. Office — 80 Wall St., New
York, N. Y. Underwriter—Dumont Securities Corp., New
York, N. Y.

•.'ti*y

'

• Greenbelt Consumer Services, Inc.
July 30 (letter of notification) 5,000 shares* of class A

:

Federal Commercial

Cooperative Grange League Federation
Exchange, Inc. ••••-/ >"■' ::Siva
.:,
June 20 filed $400,000 of 4% subordinated debentures,
10,000 shares of 4% cumulative preferred stock (par
$100) ,and 200,000 shares of common stock (par $5).

*

5, N*1T,

Underwriter—None.

and for

capital Underwriter

organization, expenses and.-working-

Glassheat Corp.
(letter of notification) 150,000 shares of
a
common stock
(par 10 cents). Price—$2 per share. Pf*.
eeeds—For general corporate
purposes.
Office—1 B.
35th Street, New York
16, N. Y. Underwriter—Jamfla
Anthony Securities Corp., 37 Wall St., New York

II this company and Amkirk Petroleum Corp.
(latter of Fort Worth, Texas) filed $400,000 of working
interests (non-producing in Sinu Valley Project), to be
offered for sale in $12,500 units (of which $8,000 is pay¬
able in cash and $4,500 is to be represented by promis¬
sory notes).
Proceeds—Exploration 1 Service Co. to ac¬
quire 80% interest in a certain concession from Amkirk

Underwriter—Noh^^.^/^.!<.

(Iff. E.)

Feb. 12

,.

'Aug.

July 1 filed 419,000 outstanding shares oL common stock
(par 20 cents). Price—Related to the current market
price on the American Stock Exchangee ^proceeds—To

selling stockholders.

—None.

^Exploration Service Co., Ltd., Far Hills, N. J.

y

Corp.

100 shares held about April 15; unsubscribed
Price—$3.50 per share. Proceeds—Few
expansion, equipment and working capital. Underwriter

Georgia Casualty A Surety Co., Atlanta, Oa.
May 6 filed 450,000 shares of common stock (par $1).
Price—$6 per share. Proceeds — For general corporate
purposes. Underwriter—Buckley Enterprises,. Inc.

tion.

Petroleum

each

shares to public.

Underwriter—None./

*'

$100 of debentures ^nd nine shares of stock
Price—To be supplied by amendment.-Prbeeeds — Tc
construct refinery. Underwriter—Lehman Brothers, New

for

33

★ Electronic Industries Inc.
July 29 (letter of notification) 100,000 shares of com¬
mon stock (par $1). ' Price—$2
per share. Proceeds—To
exercise option to acquire assets of Photo Chemical
Products of California,
Inc., reserve to acquire raw
materials and for working capital.
Office — c/o Wade
Church, 707 Arizona Savings Building, Phoenix, Ariz.

share. Proceedsr—For construction
plant.
Office—19,^Kailroad Avenue,

Underwriter—None.

Chatham. N. Y.
■

new

—For general corporate purposes.
Office — 2127 East
Lake St.y Minneapolis, Minn. Underwriter—Craig-Hallum, Inc.; also of Minneapolis.
«

;

per

telephone

new

one

(63$)

Inc., Lehman Brothers and Allen & Co., all of New
York, and Scharff & Jones, Inc., of New Orleans, La.,

*

Daybreak Uranium, Inc., Opportunity, Wash.'
1,156,774 shares of common* stock (par 10
cents), of which 630,000 shares are to he offered for ac¬
count of company and 526,774 shares fof: selling stock¬
holders.
Price—At market.
Proceeds—For exploration
and drilling costs and other corporate purposes. Underi- writer—Herrin Co., Seattle, Wash.
■ Vi;;

^ Florida National Development Corp.
Aug. 7 (letter of notification) 300,000 shares of

Jan. 29 filed

the

York;

Derson

-

.

«

^

the

ceeds-^EoF

■

June

of

share

for

each

four

shares

be

-

»

held

be

Offering—Indefinitely postponed: Statement
Other financing may be arranged.

withdrawn.

Drinks, Inc.
July 28 (letter of notification) 200,000 shares of common
(par five cents). Price—$1.50 per share. Proceeds
—For working capital and reducing current indebted¬
ness.
Office—136 East 38th Street, New York 16, N. Y.
Underwriter
Capital Reserve Corp.; 1346 Connecticut

..stock,

—

30,000

j
Digitized common stock (par $5). Price—$6.60
for FRASER


shares of class A

per

share. Proceeds

Hussman Refrigerator

Co.r St. Louis, Mo.
^
21,584 shares of common stock (par $5 be¬
ing offered in exchange for the issued and outstanding

June 27 filed

Statement to be withdrawn.

26

shares of

Laboratories, Inc.
filed

150,000 shares of capital stock

(par

10

on

debentures,

series

of

1956.

Offer

expires

1

Aug. 25.

Industrial Minerals Corp., Washington, D. C.
July 24 filed 600,000 shares of common stock (par one
cent). Price—$1 per share. Proceeds—To develop and
operate graphite and mica properties in Alabama. Un¬
derwriters—Dearborn & Co. and Carr-Rigdom & Co.,

Office—Brooklyn, N. Y. Underwriters—Statement
Co.

both of Washington, D.

C.,

on a

best efforts basis.

-.r

Corp. (N. Y.)
Feb. 28 filed 150,000 shares of common stock (par 10
<ents). Price—To be related to the market price. P»oieed»—For

^ Fred -Astaire Dance Studios (Metropolitan New
York), "Inc.
Aug. 7 (letter of notification) 299,940 shares of common
stock (par 10 cents); Price—$1 per share. Proceeds—For
constructing and furnishing new dance studios- Office—
487 Park Ave., New York, N. Y.
Underwriter—Willis
E. Burnside & Co., Inc., New York, N. Y.
General Aniline

A Film Corn.,

New York

filed 426388 shares of common A stock (no
♦par) and 1,537,500 shares of common B stock (par $1)
Proceeds—To the Attorney General of the United States
Underwriter—To be determined by competitive bidding
Probable bidders: Blyth & <Co„ Inc., and The First Bos¬
ton
Corp.
(jointly); Kuhn, Loeb & Co.; Lehman
Brothers, and Glore, Forgan & Co. (jointly). Bids—Had
been scheduled to be received up to 3:45 p.m.

(EDT) on
May 13 at Room 654, 101 Indiana Ave., N. W., Washing¬
ton 25. D. C., but bidding has been postponed.
31

stock

Inc., Princeton, N. J.
(letter of notification) 40.000 shares of

working capital and to enlarge research and
levelopment department. Underwriter — S. D. Fuller A

Co., New York.
Insured

'

Offering—Being held in abeyance.

Accounts

„

Fund, Inc.,

Boston, Mass*
May 12 filed 5,000 shares of common stock. Price—$5*000
per share. Proceeds—For investment. Business—To In¬
vest primarily in share accounts insured by the Federal
Savings and Loan Insurance Corp., in savings and lean
issociations throughout the country. Underwriter—None.
Ben H. Hazen is President.

International Opportunity

Jan. 14, 1957

com¬

(par $1) to be offered for subscription by
stockholders at the rate of approximately 18.5 shares
mon

Industro Transistor

some

March

Inc.

•

Gold¬

General Devices,

Avenue, Washington 6, D. C. '
^ Electric Power Door Co.,
Aug. 8 (letter of notification)

Sol

working capital. Office—Fort Pierce, Fla. Underwriter
—Atwill & Co., hie., of Miami Beach,, Fla., on a best
efforts-'basis.■5~. '""•
•

-

'

New York.,
may

«mendment

$174*000 of outstanding indebtedness and to
complete phase one of the port development plan, at a
cost of $1,425,248, and the balance will be added to

supplied by amendment. Proceeds—Foi
expansion and general corporate-purposes.
Office —
Clifton, N. J
Underwriter—P W Brooks & Co.. Tnc
-

MB

convertible

pay

20,-1958; Price—$1.10 per; share. Profund of the company-; Office—

new

bv

Fort Pierce Port & Terminal

general

one

(par

May 23 filed 2,138,500 shares of common stock (par $1).
Price—To be ^supplied by amendment.
Proceeds—To

'

rate

stock

to be amended.

Price—$1

,

Price—To

common

Proceeds—For exploration
Office — Portland, Ore

Price—$2.50 per share. Proceeds—For sales pro¬
of company's products, working capital, addi¬
tional inventory and accounts receivable, for research
and development and for other general corporate our

5837 W. Adams Blvd., Culver City,'. Calif. Underwriter
—Lloyd-Arnold & Co., Beverly Hills, Calif.
:,

the

named

be

ul

motion

poses.

Dixorr Chemical & Research, Inc.
vv.
Dec. 24 filed 1-65,625 shares of common stock (par $1) tt
be offered for subscription by common stockholders al

thares

stock held and

cents).

share. - Proceeds—For new equipment, repayment of
loan- acquisition of properties under option, and other
corporate purposes. Office—Toronto; Canada, and Emporium, Pa.-Underwriter—None// vv './V- ,r;:*'

on

470,000

common

common stock (par $5) of Duro-Consolidated,
Inc., and for the shares of Duro common which may be
issued upon conversion of Duro's $200,000 subordinated

Forest
March

per

business

/

filed

Price—$3 per share.
working capital.

and

berg is President.

Dikotan Laboratories, Inc.
y:
;
v:; •
June 10 ftetter Qf notification) "43,336 shares, of common
stock (par $1) to be offered to stockholders on the basis
of one share for each 10 shares held until thes close of

;

Securities Corp., NewCo., Great Neck, L. I.,

*

Underwriter—To

'

:

26

Dec.

cents).

Mines Ltd.

June 5 filed 350,000 shares of common stock.
i>

James Anthony

■::

Fluorspar Corp. of America

work

*

r...s

■;

.

;

★

beneficial

of New York.

.

—

Schwerin, Stone &

and

N. Y.

.

;

times for each
approximately 1.5 shares
(The
right to subscribe with respect to 133,850 outstanding
class A shares has been waived.) Furthermore,, $511,500
of debentures and an unspecified amount of common
shares (to be supplied by amendment) will be issued in
connection with the acquisition of outstanding common
stock of Jacksonville Gas Corp.
of class A stock for each 381,273 class A share held.

Underwriters

.

'

the basis of 1.51

share of

Office—438

ownership of one share of class A
stock of the Houston Corp. and (b) an irrevocable option
r»r to
purchase 8,945/10,OOOths of one additional share of
class A stock of Houston during a two-year period com,<
mencing on Aug. 15, 1959, or sueh earlier date as may
be determined.
Price—To be supplied by amendment.
,v
Underwriters—Lehman Brothers and Allen & Co., both
(a)

standing common, on

of mortgage and working capital.
Mercantile Bank Bldg., Miami Beach, Fla.

properties, payment
*

'

•

July 3 filed 818,333 shares of common stock and 575,869
shares of class A stock to be offered to holders of out¬

(par one cent). Price—$1 per share. Proceeds—
For development of land, promotion and sale of existing

"

Delhi-Taylor Oil Corp., Dallas, Texas
July 15 filed 575,869 depositary units for the class A
stock Of the Houston Corp., to be offered for subscription
by the holders of common stock of Delhi-Taylor of record May 23, 1958 on a l-for-10 basis (with an oversubscription privilege). Each depositary unit will represent

Houston Corp,
common

stock

Ufa Insurance Co.
shares of common stock (par $1).
Price—$5 per share. Proceeds—For working capital and
other corporate purposes. Office—Denver, Colo. Under¬
writer—Columbine Securities Corp., Denver, Colo.

June 2 filed 5,000,000

^Investors Loan Corp.
July 31 (letter of notification) 3,190 shares of 6% cumu¬
lative

preferred stock (par $50) and 1,978 shares-of
stock (par $1) to be offered in units consisting
share of each at $56 per unit. Preferred stock
can
be purchased alone at par.
Proceeds—To repay
bank loans and other short term loans. Office—12 Smith

common

of

one

Market Street,

Frederick, Md. Underwriter—None.

Continued

on

page

;

.

40

Financial Chronicle

The Commercial and

from page 39

: /

,

Realty Mortgage &

Investors

$250,000 of

filed

>

,

Financial Corp.

investors income certificates

Ju]v

24

(6%

10-vear maturities) and

125,000 shares of class A

stock. Price—The certificates will be offered in
various denominations at 100% per certificate, and the

common

class A

common

stock at $2 per share.

Proceeds—For

#

of owning, buying and selling, and other¬
wise dealing in real estate, or matters pertaining to real
estate and the improvement thereof, in the areas in
Which the company will operate. Office—Aiken, S. C.
the purpose

Underwriter—None.
Plastics Manufacturing Corp.

J. E.

July 28 (letter of notification) 39,852 shares of common
stock (par 10 cents) of which 38,750 shares will be sold

Price—$2.12 *2 per share. Proceeds—To selling
stockholder. Underwriter—John R. Boland & Co., Inc.,
SO Broad St., New York, N. Y.
publicly.

Jacksonville Capri Associates

Ltd.,

Jacksonville, Fla.
July 23 filed $325,000 of limited partnership interests.
Price—$5,000 per unit. Proceeds—For the purpose of
acquiring and operating the Capri Motel in Jacksonville,
Underwriter—None.

Fla

preferred stock. Proceeds—To purchase machinery and
equipment; to reduce bank loans; and the balance used
for working capital.
Office—1497-1499 Third Avenue,

Underwriter—None.

Freedom, Pa.

July 28 (letter of notification) 15,000 shares of common
ctock (par two cents) to be offered for subscription by
common
stockholders of record Aug. 15, 1958 on the
basis of one new share for each five shares held; rights
to expire on Aug. 25, 1958.
Price—$20 per share. Pro¬
ceeds—To retire bank loans, to invest in fixed assets and

working capital. Office—909 South Broad St., New
Orleans 25, La. Underwriter—Howard, Weil, Labouisse,
Friedric-hs & Co., New Orleans, La.
for

+ Keystone Custodian Funds, Inc.
(by amendment) 1,250,000 shares of Key¬
stone tax Exempt Bond Fund.
Price — $20 per share.
Aug. 7 filed
Proceeds

—

For

investment.

Underwriter

—

Lehman

"Brothers. New York.
Laclede Gas Co.

filed

June

18

1983.

-

Proceeds—To

due
"

1982.

$10,000,000

of first mortgage bonds due
47s% first mortgage bonds
Underwriter—To be determined by competirefund

Probable bidders; Halsey, Stuart & Co.
Inc.: The First Boston Corp.; Blyth & Co., Inc.; Lehman
tive

•

.

Thursday, August 14, 1958

bidding.

Brothers, Merrill Lynch, Pierce, Fenner & Smith and
& Gardner (jointly); Eastman Dillon, Union
Securities Corp. Bids
—Had been expected to be received up to 11 a.m. (EDT)
on July 8, but offering has been postponed indefinitely.
Reinholdt

Securities & Co.; Stone & Webster

Leader-Cleveland Realty Assootates, N. Y.
July 16 filed $1,280,000 of participations in partnership
Interests,
Price—$10,000 per participation. Proceeds—
To purchase the Leader Building in Cleveland, Ohio.
Underwriter—None.

Life

Insurance Securities

Corp.

capital stock (par $1).
trice—$5 per share. Proceeds—To acquire stoek control
of "young, aggressive and expanding life and other in¬
surance companies and related companies and then to
•operate such companies as subsidiaries." Underwriter—

None.

Inc.

shares of common
ntock (par $1). Price—From 80 cents to $1.40 per share.
Proceeds—To go to selling stockholders.
Office—24751
Crenshaw Blvd., Torrance, Calif.
Underwriter—Daniel
Reeves & Co., Beverly Hills, Calif.
Lord Elgin Hotel Corp., N. Y. C.
July 29 filed $1,655,000 limited partnership interests in
this company.

Price—$5,000 per unit. Proceeds—To pur¬
Underwriter—Tenney Associates, Inc., New

York,

Inc., 532 E. Alameda Ave., Denver 9,

Ludlow Typograph Co., Chicago, HI.
July 11 filed 106,156 shares of common stock (par $10)
being offered for subscription by common stockholders
of record July 31, 1958. on the basis of one new share
two

shares

held; rights to expire on Aug. 20.
Proceeds—For working cap¬
ital. Business—Composing room equipment and print¬
ing machinery and equipment. Underwriter—Shearson.

share to stockholders; $26 to general
public. Proceeds—For test equipment and working cap¬
ital. Office—7601 N. W. 37th Avenue, Miami, Fla.
Un¬
Price—$24

•

Magna Investment & Development Corp.
May 26 filed 56,000 shares of common stock and $500,000
of 6% convertible debentures.

(in $1,000 units); and for

diare.

Price—For debentures, at
common

stock, $4.50 per

Proceeds—For contractual

obligations, for work¬
ing capital, and other general corporate purposes. Busi¬
ness
To engage primarily in the development and
operation of various properties, including shopping cen¬
—

ters.

per

corporate

Montana

State¬

5.

(8/26)

repay $15,500,000 in bank loans and to carry on the
company's construction program through 1959. Under¬
writer—To be determined by competitive bidding. Prob¬

Stuart & Co. Inc.; Lehman Bros.;
Pierce, Fenner & Smith, and Stone &
Webster Securities Corp. (jointly); White, Weld & Co.;

able bidders: Halsey,

Merrill

Lynch,

Securities & Co.; Kidder PeaBlyth & Co., Inc.
(jointly). Bids—To be received up to noon (EDT) on
Aug, 26 at Room 2033, Two Rector St., New York, N. Y.
Dillon, Union

Eastman

body & Co., Smith, Barney & Co. and

•

price on the New York Stock Exchange. Proceeds—To¬
gether with other funds, to carry on the company's con¬
struction
program
through 1959.
Manager-Dealers —
Smith, Barney & Co., Kidder, Peabody & Co. and Blyth
& Co., Inc.
rV;
.

•

(8/18)

Mortgages, Inc.

(letter of notification) 296,750 shares of com¬
mon
stock
(par 25 cents).
Price—$1 per share. Pro¬
ceeds—To
be invested in notes secured by first and
July 28

second liens upon

of the

agement

properties to be selected by the man¬

company.

Underwriter—Copley

Roanoke, Va.

Motel Co. of Roanoke, Inc.,
Nov. 18,1957

(letter of notification) 60,000 shares of com¬
Price—$5 per share. Proceeds—
For purchase of land, construction and working capital.
Underwriter—Southeastern Securities Corp., New York.

mon

stock (par 40 cents).

Picture

Motion

on

be received at
N. Y., up to

Aug. 26.

Carolina Natural

Gas Corp.

(9/4)

$2.50) to be offered in units of $20 of deben¬
stock. Price—To be supplied by
amendment (a maximum of $33 per unit).
Proceeds —stock (par

tures and two shares of

Together with funds from private placement of $13,750,000 of 5.%% first mortgage pipeline bonds due June
1, 1979, to be used for construction program and working
capital. Office—Fayetteville, N. C. Underwriter—Kid¬
der, Feabody & Co., New York.
»■'

Co.

North Carolina Telephone

(letter of notification) 207,143

June 19

shares of common

stockholders at the ratio
share for each six shares held. Price—At par ($1

stock to be offered to common
of one

for

Enterprises Inc.

O. T. C.

(letter of notification) 23,200 shares of com¬
class B stock (par $1). Price—$5 per share. Pro¬

March
mon

6

completion of plant plans;, land; construc¬
operating expenses.
Office—2502 1ST. Calvert

ceeds—For
and

Baltimore

St.,

18,

Underwriter—Burnett & Co.,

Md.

Sparks, Md.

common

stock. Price—At

Investors

$1.75 per share; and to public, $2 per share. Proceeds—
For mining, development and exploration costs, and for
working capital and other corporate purposes. Under¬
writers—Harrison S. Brothers & Co., and Whitney & Co.,

City, Utah.

Inc., Tulsa, Okla.

Oil & Mineral Operations,

April 14 filed 200,000 shares of common stock. Price—
$2.50 per share. Proceeds—For payment of loans, various
—To acquire and operate mining claims and oil and gas
equipment, and a reserve for future operations. Business
properties. Underwriter—Universal Securities Co., En¬
terprise Building, Tulsa, Okla.
•

One-Hour Valet,

Inc., Miami, Fla.

(8/21)

102,566 shares of common stock (par $1).
by amendment. Proceeds—To
selling stockholders. Underwriter—R. S. Dickson & Co.,
Inc., Charlotte, N. C.
•

July 29 filed
Price

—

To

Paradox

be supplied

Production Corp.,

Salt Lake City, Utah

April 18 filed 767,818 shares of common stock (par $1),
of which 100,000 shares are to be offered by the company
in exchange for oil and gas properties and 3,000 for serv¬
ices; the remaining €64,818 shares are to be offered to
the public. Price—To be supplied by amendment. Pro¬
ceeds—To selling stockholders.
Underwriter—Market
Securities, Inc., Salt Lake City, Utah. Statement effec¬
tive Ji*ne 5.
Peckman

Plan Fund, Inc.,

Pasadena* Calif.

derwriter—None.

writer—Investors Investments Corp.,

Inc.

(N. Y.)

May 9, 1957 filed 5,000 units of undivided interests in
Municipal Investment Trust Fund, Series A. Price—At
market. Proceeds—For investment. Sponsor—Ira Haupt
&

.1

Co., New York.

19 filed 20,000 shares of common stock (par $1).
Price—At market.
Proceeds—For investment.
Under¬

ity stockholders on the basis of one new share for each
Any unsubscribed shares will be pur¬

four shares held.

Mining Corp., Estes Park, Colo.
(letter of notification) 2,916,000 shares of non¬
assessable common stock (par one cent). Price—10 cents

chased by

share. Proceeds—For mining expenses. Underwriter
—Birkenmayer & Co., Denver, Colo.

cago

National Beryl &

May 16
per

National Educators Finance

(letter of notification)
Price—At par

stock.

train

To

and

Corp.

50,000 shares of common

(50 cents per share).

Proceeds—

to implement and carry
projected plan of development and operation.
Office—1406 Pearl St., Boulder, Colo.
Underwriter—
Western Securities Co., Boulder, Colo.
procure

persons

the

out

National Gypsum Co.
25
filed 298,000 shares

June

common

stock

to

be

offered in

exchange for all but not less than 90% of the
outstanding shares of common stock of American En¬
caustic

Tiling Co. Inc., in the ratio of one share of
National Gypsum common for each 2-4/10ths of Amer¬
ican Encaustic common.
National Gypsum shall have
the right, at its election, to accept less than 90% but in
no

event less than 81%

mon.

of the American Encaustic

Statement effective July

17.

4r National Steel Corp.
Aug. 11 filed 281,068 shares of capital stock
to certain

officers

its subsidiaries,
Price—$50 per share.

and

com¬

(par $10),

and

employees of com¬
pursuant to a stock option

Nedow Oil Tool Co.

July 1, 1978.

Tex.

Underwriter—T. J. Campbell Investment Co., Inc.,

Houston. Tex.

Rock-Ola Mfg. Corp. Warrants expire 20 days
Price—$4.25 per share. Proceeds
capital. Office—800 N. Kedzie Ave., Chi¬

from date of issuance.
—For working

51, 111.

Underwriter—None,

Pennsylvania Power Co. (8/27)
Aug. 1 filed $8,000,000 of first mortgage bonds due 1988.
Proceeds—To redeem a like amount of 5% first mort¬
gage

bonds due 1987.

Underwriter—To be determined

by competitive bidding. Probable bidders: Halsey, Stuart
& Co. Inc.; Kidder, Peabody & Co.; Equitable Securities

Shields & Co. (jointly); Lehman Brothers;
Pierce, Fenner & Smith and Dean Witter
(jointly). Bids—Tentatively expected to be re¬
ceived up to 11 a.m. (EDT) on Aug. 27,

Corp.,

and

Merrill Lynch,
&

of

Pasadena, Calif.

Weighing & Vending Machine Corp.
June 27 (letter of notification) a maximum of 25,000
shares of common stock (par $1) to be offered to minor¬
Peerless

Martin Co., Baltimore, Md.
June 11 filed $25,000,000 of sinking fund debentures, due

Proceeds — Working capital and general
Price—To be supplied by amend¬

Utah

Inc.

May 5 (letter of notification) 150.000 shares of common
stock (par one cent). Price—$2 per share. Proceeds—To
pay loan; to acquire fishing tools for leasing; and for
working capital. Office—931 San Jacinto Bldg., Houston,

Proceeds—For investment.

Salt Lake City,

Inc.,

May

plan.

ir Mairs & Power Fund, Inc., St. Paul, Minn.

Oil

April 4 filed 597,640 shares of common stock (par $1)
to be offered for subscription by common stockholders
of record March 24, 1958 at the rate of IV4 new shares
for each share then held. Employees may purchase 50,000 shares of unsubscribed stock. Price—To stockholders,

July 11 filed 200,000 shares of common stock (par $1).
Price—$10.75 per share. Proceeds—For investment. Of¬
fice—1000 Power & Light Bldg., Kansas City, Mo.
Un¬

pany




(EDT)

a.m.

North

Office—223A Independence

Building, Colorado Springs, Colo.
& Co., Colorado Springs, Colo. •

Offering—Expected

of August.

corporate purposes.

•

both of Salt Lake

Power Co.

Montana

July 1 filed 100,000 shares of common stock (no par).
The stock will be offered only to bona fide residents
of Montana. Price—To be related to the current market

Hogle & Co., Salt Lake City, Utah.

market.

11

tion

Co.

fuly 1 filed $20,000,000 of first mortgage bonds clue 1988.
Proceeds
Together with other funds, to be used to

to be offered

6 filed 40,000 shares of

Underwriter—None,

purposes.

Power

Underwriter—J. A.

Aug

shares of common stock. Price—
Proceeds—For working capital and gen¬

ment effective Aug.
•

& Co. Inc.; The First Boston

Corp.; Morgan Stanley & Co. Bids—To
Room 2315,
195 Broadway, New York,

share). Proceeds—To pay off obligations and
telephone plant construction. Underwriter—None.

May 27 filed 15,000
$100 per share.

Office—Salt Lake City, Utah.

in latter part

able bidders: Halsey, Stuart

Princeton, N. J.

eral

to

per

Developers, Inc.,

Modern Community

Price—$10 per share.

Harnmill & Co.. New York.

par

Colo.

ir Milgo Electronic Corp.
Aug. 6 (letter o± notification) 10,000 shares of common
stock (par $15 to be offered for subscription by present
stockholders on the basis of one share for each 8.8 shares
owned of
record date.
Rights expire in September.

June 4

1958.

Proceeds

intended

are

July 31 filed $5,200,000 of subordinated income deben¬
tures due Aug. 15, 1983, and 520,000 shares of common

Kansas City, Mo.

Mid-West Durex Co.,

Municipal Investment Trust Fund,

June 18 (letter of notification) 34,000

for each

— To refund a like amount of 4Y2%
bonds, series B, due May 1, 1961, which
be redeemed on Nov. 1, 1958. Under¬
writer—To be determined by competitive bidding. Prob¬

1, 1992.

.

July 14 filed 725,000 shares of common stock (par $1).
Price—$2 per share. Proceeds—For construction of plant
and for working capital. Underwriter—Investment Sales,

ITrst Maine Corp., Portland. Me.

chase hotel.

(8/26)]

debentures due Sept.;

first mortgage

May fair Markets
March 24
(letter of notification) 5,000 shares of 6%
cumulative preferred stock (par $50) and 5,000 shares
of common stock (par $1) to be offered in units of one
share of preferred and one share of common stock. Price
—$60 per unit. Proceeds—For working capital. Office—
4383 Bandini Blvd., Los Angeles, Calif.
Underwriter—

March 28 filed 1,000,000 shares of

Longren Aircraft Co.,

July 31 filed $40,000,000 of 34-year

—

Corp., New Orleans, La.

Kalvar

2, has been postponed.

ing, which was expected on July
Issue to remain in registration.

derwriter—None.

* Jiffy Steak Co.
Aug. 4 (letter of notification) 3,000 shares of 7% pre¬
ferred stock
(par $50) and 6,000 shares of common
stock (par $5).
Price—At par. There will be offered
one
share of common stock at par with each share of
-

.

England Telephone & Telegraph Co.

New

Underwriter—Smith, Barney & Co., N. Y. Offer¬

ment.

Continued

-

.

(636)

40

Co.

Peruvian Oils & Minerals Ltd., Toronto,

Canada

,

filed 200,000 shares of capital stack (par $1).
Price—To be supplied by amendment.
Proceeds—For
working capital. Underwriter—Doolittle & Co., Buffalo,
N. Y., and Davidson Securities Ltd., Toronto, Canada.,

July

11

.

Inc. (8/18)
July 29 filed 100,000 shares of common stock (par $25).
Price—To be supplied by amendment.
Proceeds—For
Pillsbury Mills,

capital expenditures. Underwriters—Goldman, Sachs &
Co., New York, and Piper, Jaffray & Hopwood, Minne¬
apolis, Minn.
Policv

March 25
mon

stock

common

Advancing Corp.
(letter of notification) 30,250 shares of com¬
(par $5) to be offered for subscription by

stockholders at the rate of

one

new

share

share for

held; unsubscribed shares to be offered to
debenture holders and to others.
Price—$8 per share.
Proceeds—For working eapital.
Office—27 Chenango
each

St., Binghamton, N. Y.

Underwriter—None.

Volume 138

Number 5768

.

.

.

The Commercial and Financial
Chronicle

• Ponce de Leon Trotting Association, Inc.
Aug. 7 filed 400,000 shares of common stock (par one
cent). Price—$1.50 per share. Proceeds—To pay current

Growers Container.
derwriter—None.
San

liabilities, for new construction and working capital.
Office—Bayard, Fla. ; Underwriter—Robert L. Ferman
Co., Inc., Miami, Fla.

57,500 shares of class A
to be offered in units of

stock (par one cent)
500 shares of stock and $500 of debentures.

cap¬

class

Pike, Rockville, Md. Under¬
writer—Whitney & Co., Inc., Washington, D. C.

Price—-$2.50

share.

per

Proceeds

—

For

ployee

j

Public

Service Electric & Gas Co.
(8/20)
July 24 filed $60,000,000 of first and refunding mortgage
1, 1988. Proceeds—To be added to the

general funds of the company, and will be used
by it
for its general corporate
purposes, including payment
before maturity of $10,000,000
principal amount of un¬

*

\

at 80

bidders:

Rapid-American Corp., New York

Stock

—

Trans«America

Uranium Mining Corp.
?■'.%.,■
.Nov. 6, 1957 filed 3,000,000 shares of common stock
(par
one mill). Price—25 cents per share. Proceeds—For land

acquisition, exploratory work, working capital, reserve**
and other

corporate purposes. Underwriter—None.
fred E. Owens of Waterloo, la., is President.

be

for

construction

program.

.

,

(Calif.)

until Oct. 14, 1958.
gan Stanley & Co., New York.

Pur¬

open

invested in stocks

and

bonds

.

(par $7)

fice—11

share for each three shares held

to

Twentieth

mon

cents).

June 20 filed $10,000,000 of plans for the accumulation
of shares of Twentieth Century Investors, Inc. Price—At
market.
Proceeds — For investment.
Underwriter—
Stowers &

July'29 filed 225,000 shares of capital stock (par $1) toshare.
crease

poses.

United Employees Insurance Co.
April 16 filed 2,000,000 shares of common stock (par $5).
Price — $10 per share. Proceeds — For acquisition of
operating properties, real and/or personal, including
office furniture, fixtures, equipment and office space, toy
lease or purchase. Office — Wilmington, Del. Under¬
writer—None.
Myrl L. McKee of Portland, Ore., 1*

Underwriter—H. A. Riecke & Co., Inc.,

President.

•

,,

Rocky, Mountain ^Quarter Rpcing
Oct. 31* 1957 "(letter of notification)
common stock.
Priee-^At.;pair ($1 per
—To r repayMJutstan&mg indebtedness.

:>}

::

'

Office—Littleton,
Co., Wlndover Road,
V-v- V ' v- - • =
: >
-

; ;

*

common.

The

exchange

offer

is

assured

as

over

of

Texas Calgary .Co., Abilene, Texas
April 30 filed 2,000,000 shares of capital stock (par 25
cents). Price—To be. supplied by amendment. Proceeds
—To selling stockholder. Underwriter—Thomson Kernaghan & Co., Ltd., Toronto, Canada. To be offered in
Canada only.

accounts

of the company;

Price — $8 per share. Proceeds — For
working capital. Office—31 Fulton Street, Newark, N. J.
Underwriter—None.
• St.

Regis Paper Co., New York
July 8 filed 118,746 shares of common stock (par $5)
being offered in exchange for outstanding shares of capi¬
tal stock of Growers Container
Corp., Salinas, Calif., on
the basis of one St. Regis share for 18 shares of stock of




Universal-Cyclops Steel Corp.
(8/2S) ,
Aug. 5 filed $22,500,000 of sinking fund debentures due
Sept. 1, 1978. Price—To be supplied by amendment.
Proceeds—To repay $10,300,000 of bank loans and for
-

offer expires Aug. 8.
Co., Inc., New York.

direct retail

.

80%

Aug. 1 (letter of notification) 25,000 shares of common
stock (par $1) to be offered to the wholesale district
and

-

,

306,000 shares of
share); Proceeds

Ford

Shavers

stock (par am

f.

"

Association

of Middle States common stock has been deposited.

Electric

United States Sulphur Corp.
Oct 8 filed 1,500,000 shares of common

cent). Price—$1 per share. Proceeds—For plant rental
etc^ to jretire corporate notes; for core drilling; foe
working capital; and for ether exploration and developable Securities Corp., Nashville, Tenn.
Offering—Held, y ment work
Office — Houston. .Texas.
Underwrite* —r,
up pending passing of necessary legislation by Congress,
./None. Statement effective June 23.
which is expected early next week.
United States Tetemail Service, Inc.
Tennessee Gas Transmission Co.
,r
-.
Feb. 17 filed 375,000 shares of common stock (par $1),
June 2 filed 1,084,054 shares of common stock (par $5)
;
Priee—$4 per share. Proceeds—To purchase equipment
being offered in exchange for common stock of Middle
and supplies and for working capital and other corporate
States Petroleum Corp. at the rate of 45 shares of Ten/ purposes. Off ice—Salt Lake City, Utah.; Underwrite*—
nessee Gas common for each 100 shares of Middle States
Amos Treat & Co., Inc., of New York.;
;

it Ronson Corp.

Ronson

Underwriter—None.

June 20, 1957

ment; the enlargement of the research and development
facilities of the company; patent and
patent applications;
public relations, and for working capital. Underwriter—
None.

Memphis;^nn. ;;;

it United Life & Accident Insurance Co.
Aug. 8 (letter of notification) 410 shares of capital stock
(par $20). Price—$375 per share. Proceeds—For capital
and surplus accounts. Office—2 White St., Concord, N. H.

Tax

Exempt Bond Fund, Inc., Washington, D. C.
filed 40,000 shares of common stock (public
offering of 500,000 shares now planned). Price—$25 per.
share." Proceeds—For investment.
Underwriter—Equit¬

stock, class B.

per

'.UndCTwxiter—R. B.

stock

None.

N. Y.

share.' Proceeds—To manufacture on a
contract basis-an automatic telephone
answering instru¬

Colo.

exercise of options exercisable at $4 per
Proceeds—To pay outstanding liabilities, to in¬
working capital and for general corporate pur¬
Underwriter—None.

—

Robosonic National Industries
Corp.,
June 12 filed 500,000 shares of common

Price—$3

y

be issued upon

(par $1) to be offered in units consisting of
principal amount of debentures and 26 shares
of stock.
Price—$1,200 per unit. Proceeds—For pay¬
ment of
short-term bank loan and working capital.
Business
To operate recreation area.
Underwriter —

"best efforts" basis.

Co., Kansas City, Mo.

United Asbestos Corp., Ltd., Montreal, Canada

$800

of common stock (par 10
Price—To be supplied by amendment. Proceeds
—For working capital. Underwriter—James H.
Price &
Co,, Inc., of Coral Gables, Ftp., for 250,000 shares; balance

City, Mo.

Century Investors Plan, Kansas City.

V,

Sugarbush Valley Corp., Warren, Vt.

May 15 filed Y50,000 shares

Century Investors, Inc., Kansas City,

writer— Stowers & Co., Kansas

acquire other life

June 25 filed $392,800 of 20-year 6% subordinate income
debentures due May 1, 1978, and 12,766 shares of com¬

Airlines, Inc., Miami, Fla.

Timothy H.

~

Mo.

Philadelphia, Pa.

—

Street, Newark, N. J.

June 20 filed 2 000,000 shares of common stock (par $1).
Price—At maiiiet.
Proceeds—For investment. Under¬

July 29 (letter of notification) 26,850 shares of common
stock (par 10 cents) to be issued upon exercise of war¬
rants.
Price—$1 per share. Office—Main & Astor Sts.,

couver, Canada.

President.

Twentieth

it Strouse, Inc.

Norristown, Pa.

Commerce

Dunn is

Strategic Minerals Corp. of America, Dallas, Tea
$2*000,000 of first lien mortgage 6% bond#
and 975,000 shares of common stock (par 10 cents). Prie#
—For bonds, 95% of princmal amount; and for stock $S
per share. Proceeds—To erect and operate one or moi«
chemical processing plants using the Bruce - William#
Process to beneficiate manganese ores.
UnderwriterSouthwest Shares, Inc.. Austin, Texas.

oversubscription privilege). The subscription
period will be for 30 days following issuance of sub¬
scription rights. Price—To be supplied by amendment.
Proceeds—To pay off demand note, to pay other indebt¬
edness, and the balance if any will be added to working
capital. Underwriter
Pacific Securities Ltd., Van¬

Priee

1

March 31 filed

an

share for 10 shares owned.

Triton Corp., Newark, N. J.
Aug. 1 filed $1,600,000 of 5% debentures due 1973, 4,000
shares of 6% preferred stock (par $100)
and 48,00®
shares of common stock (par $1) to be offered in units
of $8,000 of debentures, 20 shares of preferred stock an
240 shares of common stock.
Price—$10,240 per unit.
Proceeds—To acquire, own and operate interests in pro¬
ducing oil and gas properties. Underwriter—None. Of¬

insurance companies. Address—P. O. Box 678, Gulfport,
Miss. Underwriter—Gates, Carter & Co., Gulfport, Miss.

Ltd., Alberta, Canada

new

writer—None.

Exchange Agent—Mor¬

and

one

—$4 per share. Proceeds—For drilling for oil and ga*..
Office—203 N. Main Street, Coudersport, Pa. Under¬

Life, Health & Accident Insurance Co.
July 9 (letter of notification) 50,000 shares of common
stock (par $1).
Price—$5 per share. Proceeds—To be

(9/3)

Trans-Eastern Petroleum Inc.
Feb. 27 (letter of notification) 7,500 shares of common
stock (par $1) to be offered pro-rata to stockholders on
the basis of

State

the 1,174,716 shares for subscription by its shareholders

on

held or represented by bearer shares of record
May
28, 1958; rights to expire on Aug. 1, 1958. Price — 50c
per share.
Proceeds—For general corporate purposes
including exploration and drilling expenses and capital
expenditures. Underwriter—None.

determined

.

,

so

Underwriter—To

by competitive bidding. Probable bid¬
Halsey, Stuart & Co. Inc.; Kuhn, Loeb & Co.; First
Corp,, and Dean Witter & Co. (jointly); Blyth
& Co., Inc. Bids—Expected to be received
up to 9 a.m.
(PDT) on Aug. 25 at company office.
V\. ;

Al¬

Trans-Cuba Oil Co., Havana, Cuba
March 28 filed 6,000,000 shares of common stock
(par 50
cents) being offered for subscription by holders of out¬
standing shares of capital stock and holders of bearer
shares, in the ratio of one additional share for each share

Southern California Edison Co. (8/25)
Aug. 4 filed $50,000,000 of first and refunding mortgage
bonds, series K, due 1983. .Proceeds — To retire bank '
and

The

Dealer-Manager—Dillon, Read &

Thomas Paint Products Co.

May 26 (letter of notification) 1,250 shares of common
stock (par $10) and $37,500 of 6% serial subordinated

,

•

struct! on program. Underwriter—To be determined by
competitive bidding. Probable bidders: Halsey, Stuart &
Co. Inc.; Kidder, Peabody & Co.; Eastman
Dillon, Union
Securities & Co.; The First Boston
Corp., and Lehman
Brothers (jointly).
Bids—Expected to be received on
Sept. 10.

remain

the company and 824,000 shares for the account of cer¬
tain selling stockholders. The
company proposes to offer

Riddle

>

corporate purposes. Underwriter
Andersen-Randolph.
y& Co.,.Inc., Salt Lake City, Utah. "V ' :Z7CIy
V

''

be offered in exchange for Humble Oil & Refining
Co. capital stock at rate of five Standard Oil shares for
each four Humble Oil shares. The offer is expected to

June 26 filed 1,998,716 shares of common stock
(par $1),
Of this stock, 1,174,716 shares are to be sold on behalf of

new

-V'

to

;

one

em¬

purchase

';

ing capital and general corporate purposes. Underwriter
Israel Corp., New
York, on a "best efforts"

(with

To

—

Underwriter—None.

(New Jersey)
(8/19)
July 31 filed 11,406,078 shares of capital stock

—Rassco

at the rate of

Proceeds

to

Standard Oil Co.

June 26 filed $1,000*000 of 15-year 6% series A
sinking
fund debentures due 1973, to be offered in denominations
of $500 and $1,000. Price—At par. Proceeds—For work¬

Petroleum

plan.

pursuant

New York, N. Y. Offering—Postponed from June 25
by
the company "due to market conditions."
Issue to re¬
main in registration.

chase Plan.

Rich we 11

market.

issued

,

,

Inc., and
Calif., and

shares, 75,000 are issuable under the company's
Restricted Stock Option Plan for officers and
key em¬

•

*

this year to provide additional capital for the company'i

common

basis.

open

be

;

Tip Top Oil & Gas Co., Salt Lake City, Utah, %
April 15 filed 220,000 shares of common stock, of which
200,000 shares are to be publicly offered. Price—$5 per
;Share. Proceeds—To drill two new wells and for general

overall program. Underwriters—Blyth &
Co.,
Dean Witter & Co., both of San
Francisco,

ready outstanding having been issued in payment of
47,000 shares of common stock of Butler Brothers which
were acquired by Rapid American from 19
persons, in¬
cluding three directors of the corporation. The deben¬
tures are being registered against the possibility that
they may be sold by present owners. Of the 105,000

Corp.

on

to

Underwriter—

—

June 4 filed $150,000,000 of sinking fund debentures due
July 1, 1983. Price—To be supplied by amendment. Pro¬
ceeds—To refinance a bank obligation of
$50,000,000 due

June 19 filed $1,504,000 of 7%
sinking fund debentures,
due Nov. 15, 1967, together with
105,000 shares of com¬
mon stock (par
$1). Proceeds—The debentures are al¬

Rassco Financial

yc-ar

Standard Oil Co.

(jointly). Bids—Ex¬
(EDT) on Aug. 20
Park Place, Newark, N.
J., /•;
a.m.

ployees, and 30,000 under the Employees'
Underwriter—None.

in units

Boston

Loeb & Co. and Lehman Brothers

to 11

be offered

Price—$101 per unit.
acquisition of

ders:

Halsey, Stuart & Co. Inc.; The First Boston Corp.; Kuhn,
up

to

operation,

Electric & Gas Co.. (9/10)
Aug. 12 filed $10,000,000 first refunding mortgage bonds
due 1988.
Proceeds—To repay bank loans and for cori-

loans

secured short-term bank loans made to the
company on
June 30, 1958, and payment of a
portion of the cost of
its current construction program. Underwriter —
To be

pected to be received

of

St., S. W., Atlanta, Ga.

.

,

bonds due Aug.

Probable

each.

;

Timeplan Finance Corp.
March 25 (letter of notification) 27,272 shares of 70-cent
cumulative preferred stock (par $5) and 27,272 share*
of common stock (par 10
cents) to be offered in unit*
of one share to each class of stock. Priee—$11
per unit
.Proceeds
For working capital.
Office —111 E. Main
St., Morristown, Tenn. Underwriter—Valley Securitie*
Corp., Morristown, Tenn.
>
,y-

* South Carolina

"'

—

bidding.

par)

ol

costs

stock purchase

shares

share. Proceeds
To be used to
organize, or re¬
organize and then operate companies in foreign nations,
principally, but not exclusively, in the Far East, Near
East and Africa. Underwriter—None.

competitive

per

con¬

Enterprise, Inc., Wichita, Kansas
May 5 filed 125,000 shares of common stock. Price—$10

by

(no

share

initial

stock

common

*

determined

one

Whitehall

None.

it Sorg Paper Co., Middletown, Ohio
V *. ' V
Aug. 6 (letter of notification) not in excess of $100,000

Private

per

543

equipment and working capital. Office—22275 Parneli
Road, Shaker Heights 22, Ohio. Underwriter—None. ■ /,

purpose.
Office — Saskatoon, Saskatchewan,
Canada. Underwriter—Allied Securities
Ltd., Saskatoon,
.L

stock

common

Proceeds—For

struction

Canada.;-■ >

B

consisting of

Prairie Fibreboard Ltd.
Feb. 28 filed 210,000 shares of common stock
*(par $1.50)
to be offered for sale to residents of Canada in
the Prov¬
inces of Manitoba, Saskatchewan and
Alberta and to
residents of the United States
"only in the State of North

Dakota."

owned (500 of the shares ars
being offered to the President of the company). Price—*
$60 per unit. Proceeds—For working capital. Office—

★ Servair, Inc.
Aug. 1 (letter of notification) 2,800 shares of 8% cumu¬
lative preferred stock (par $100)
and 2,800 shares of

Price—$1,000
working

each two shares of stock

cumulative convert¬
par

ing—Postponed indefinitely.

nated convertible debentures and

per unit.
Proceeds — For equipment and
ital. Office—1550 Rockville

debentures series 1958, to be offered in units of one
share of stock and $50 principal amount of debentures
to be offered to stockholders on the basis of one unit for

Un¬

($10 per share)
Proceeds—To retire $550,000 of promissory notes. Under¬
writer—J. A. Hogle & Co., Salt Lake
City, Utah. Offer¬

(letter of notification) $57,500 of 6% subordi¬

common

Aug. 30.

on

Diego Imperial Corp., San Diego, Calif.

June 2 filed 70,000 shares of,
5^%
ible preferred stock.
Price — At

Potomac Plastic Co.

March 31

The offer expires

construction program.

Underwriter—A. G. Becker & Cck„

Inc., Chicago, 111., and New York, N. Y.

Chicago, III.
of class A common stock, rrfce
—$4 per share. Proceeds—For exploration and develop¬
ment of propei*ties, and the balance for other corporate
purposes.
Underwriter—None.
Continued on vaae 42
Universal Oil Recovery Corp.,

June 4 filed 37,500 shares

_

42

I

Continued from page

.

.

I.,!"' #■'

'

>'

•

.

' '

■ I

•

',

41

Uranium Corp. of America,

Proceeds—For exploration
Underwriter—To be named by amendment.

pected to be $1 per share).
purposes.
Graham Albert

Ore.,

Portland,

of

Griswold

is

Pres¬

ident.
Utah Minerals Co.

April 11 (letter of notification) 900,000 shares of com¬
mon stock. Price—At par (10 cents per share).
Proceeds
—For mining expenses. Office—305 Main St., Park City,
Utah. Underwriter—Walter Sondrup & Co., Salt Laki

Utah Power & Light Co.
26

filed

$20,000,000

Proceeds—To

(9/9)

of first mortgage bonds due
$15,000,000 of first mort¬

redeem

$4,000,000 of
with further
bank agreement and cash generated

gage bonds, 5V\% series due 1987, to repay
bank borrowings, and the balance together

borrowings tinder
in

a

the business will be used to carry forward the con¬

struction

program

tive bidding. Probable bidders: Halsey, Stuart & Co.
Inc^ First Boston Corp. and Blyth & Co. Inc. (jointly);
White, SWeld & Co. and Stone & Webster Securities Corp.
(jointly); Salomon Brothers & Hutzler; Kidder, Peabody
& Qoj Eastman Dillon, Union Securities & Co., and
Smith, Barney & Co. (jointly). Bids—Expected to be re¬
ceived in Room 2033, 2 Rector Street, New York, N. Y.,
up to noon (EDT) on Sept. 9.

Western Carolina Telephone Co., Weaverville,
N. 'Car.

June « tfiled
fered for
mon

89,391 shares of

stock to be of¬

common

subscription by holders of outstanding com¬
one

new

share for each three

shares held. The record date is to be supplied by amend¬
Price—At par

($5 per share). Proceeds—To be
applied to the payment of $700,000 of short-term bank
loans incurred in carrying forward the company's con¬
struction and conversion program. Underwriter—None.

4'We stern Industrial Shares, Inc., Denver, Colo.
July 16 filed 1,000,000 shares of common stock (par 25
cents). Price—$5 per share. Proceeds—For investment.
Underwriter — Andersen, Randolph & Co., Inc., 65' So.
Main St., Salt Lake City, Utah.
,

Western Pacific Mining Co., Inc.
May 26 filed 564,000 shares of common stock. Price—At
par ($1 Per share). Proceeds—For capital expenditures
and exploration costs. Office—Santa Paula, Calif.
Un¬

Probable

these two points will probably
mid-August or early September.

Decision

Proceeds—To

on

until

be reached

not

Hadley Corp.
The shareholders of the company at
held

a

special meeting

June 25, approved an amendment to

on

the certi¬

incorporation authorizing an issue of 200,000
of 5%
cumulative convertible preferred stock

of

ficate
shares

Convertible into common stock at the rate

(par $10).

$2.86 per share. Proceeds—To retire outstanding notes
of a subsidiary in the amount of $768,000.
of

Electric Co.,

Louisiana

Central
March 28 it

Inc.

announced that the company's financinj

was

the year 1958 anticipates the sale of both
debt and equity securities (probably preferred stock)
aggregating approximately $5,000,000. Both issues may
be placed privately.
program for

Cincinnati & Suburban Bell
Co.

(10/21)

Telephone

"

.

announced that the directors have author¬
of not exceeding $25,000,000 debentures
having a maturity of not more than 35 years. Proceeds
—To repay advances received from American Telephone
& Telegraph Co. which owns 29% of the outstanding
common stock
of the company.
Underwriter — To be
determined by competitive bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; Morgan Stanley & Co.; Glore,
Forgan & Co. and Eastman Dillon Jnion Securities &
Co. (jointly). Bids—Expected to bar^^eived on or about
July 7 it
ized

was

the

21.

Consumers

to

be

one new

share for each four shares held and

share

for

the

balance

the number of shares

offered

holders

of

of

such

one

holdings

in

divisible by four; also

outstanding 5%

subordinated

debentures of record March 24 at rate of five shares for
each $1,000 of debentures then held. Price — $60 per
share.

Proceeds—-For

working

capital.

Underwriter—

None.
'

Wilier Color Television System, Inc.
April 2 (letter of notification) 72,035 shares of common
stock (par $1) of which 10,000 are to be offered to stock¬
holders at $2 per share and the remaining 62,035 shares
are

to be

publicly offered at $3 each.

general corporate purposes.

Proceeds — For
Office—151 Adell Avenue,

Yorkers, N. Y. Underwriter
Broadway, New York 6, N. Y.

—

Edwin

Jefferson,

39

Underwriter—To be determined \
bidding. 'Probable bidders: /Halsey,,
Stuart & to. Inc.; Kidder, Peabody & Co., and Merrill >
Lynch, - Pierce, /Fenner & Smith
(jointly).; Lehman
Brothers; Eastman Dillon, Union Securities & Co. and
Stone & Webster Securities Corp. (jointly); Glore, For¬
gan & Co., .and Goldman Sachs & Co. (jointly),
/ /'ff
construction .program.;

Power Co.

(9/23)

Kansas Rower. &

<

tional

financing this year, in the form of common stock,
preferred stock, or a combination of the two, including
loans.

Proceeds—For expansion

program,

work¬

ing capital and inventories. Underwriters—Blyth & Co..
Inc. and Merrill Lynch, Pierce, Fenner & Smith.
American-South African Investment Co.
June 13 filed for permission to become
registered as an
Investment company of the closed-end
type under the
Investment Company Act of 1940. Business—The trust
.

incorporated under the laws of the Union of Africa, has
been organized to provide a medium for
investment in
the tomemon shares of companies
engaged in business in
South Africa, with particular
emphasis on those engaged
in

mining gold.

The trust may also invest to

extent in gold bullion.

a

certain

Underwriter—Dillon, Read & Co.

Kentucky 'Utilities Co.
June

was announced that the

Blyth & Co.,^ IriC. hnd 3: 3. B. Hilliard & Son.

the issuance and sale of $30,000,000 bonds. Proceeds—For
elerirfc power projects and other improvements. Under¬

writer—May be Kuhn, Loeb & Co., New York.
tog—Expected in October or early November.

Offer-

ceived

July 3,

July 17 it

(9/23)

announced that the company plans to issue
and sell not more than 200,000 shares of pfd. stock. Pro¬
ceeds—For expansion and improvement of service facili¬
ties.
Underwriter—May be determined by competitive

Gas

on

it

rJans to offer to bona fide-residents of
10,Ot) shares of capital stock (par $1). Price
-i_$10 per shar-.-, less an underwriting discount of 8(6%.
Proceeds—For^ investment.
" ■

notes

Midwestern Gas Transmission Co.

Stanley & Co.; The
Ripley & Co. (jointly);

Sept. 23.

March

bidders

construction

for

and

be

may

7

Power;,,-Commission for permission to issue first
bonds, unsecured notes and common stock.
Proceeds—To build pipe line system to cost about $111,000,000.
Underwriters — Stone & Webster Securities
Corp. and White Weld. & Co., both of New York.
.
•




an

a

plan

Line

Company

Inc.

and

•

was reported a secondary offering of common
voting stock is expected in near future. UnderwritersMay include: Blyth & Co., Inc.;'Carl M. Loeb, Rhoades
& Co.; Hemphill, Noyes & Co.; Smith,
Barney & Co.:
and Merrill Lynch. Pierce, Fenner & Smith.

of

$2,000,000 and

AUgust

new
or

a

maximum of $5,000,000 via

shares of

September.

in

common

stock to

Proceeds

—

known

as

minimum
an

offer¬

stockholders

in

For working capital.

company

-;plans to issue

amount ;of,; first

mortgage

$10,€00/000) in the -latter part of this

early 'T1859.K Proceeds

Moore-McCormack

S. Argentina.

-

To

repay

year

-

Lines,

Inc.

Underwriters—Kuhn, Loeb & Co.

and Lehman Brothers,

Mountain

both of: New York.;:

State Tele.

& Tele. Co.

.

:

/

(9/30)

July 29 it was, announced company plans to offer to its
stockholders of record Sept.: 26,; 1958 the rigths to sub¬
scribe on or before Oct. 24, 1958 for 700,961 additional

stock on the basis of one new share
five'shares held. American Telephone & Tele-:

of capital

shares

for each

graph Co.," the paDfeftt; owns/ over 80% of the 3,504,809
outstanding'shares." Price —At 'par ($100 per share).
Proceeds—^To rebay"temporary-loans made to finance the

Underwriter—None, Y ;;CoY'(:iO/i1 V;*4;?.- *'
C;\ - '
Aug. 4 iOy^s ie^rted company plans to issue and-sell
825.000,000 /of 25-year 'sinking;fund -debentures.
Pro¬
ceeds—'To reftipd" $15,000,000 outstanding 5Vz'% sinking
?fund debenlures^nd to repay bank loans. Underwriters
company's expansion'"program.
NationaJFuel

—To
,

Union

Gar

vdetermined" by competitive bidding.

Probable
Eastman Dillon,
Securities -& Co^Kahd- Stone & Webster Securities

be

bidders:

iialSeyr-Stuart'^^; Co; Inc.;

Harriman Ripley-&
BidS-^Expected to be received up. to 11:30 a.m.

Corp. (joihtlyJV Whiter>Veld & Co.;
Co. Inc.

J (EDT)

announced company (formerly
Interstate Oil Co.) intends to obtain a
was

undetermined

(about.

and S.

bonds

offer¬

an

(9/15-19)
/to' issue and
sell $24,000,000 of government insured bonds secured by
a first preferred ship /mortgage on the liners S. S. Brasil

authorizing the
common stock

"Santa Paula"

Utilities Co.v

March 24 it Was Announced company plans

offering of

expected early in September and
ing later in year.

Gulf

ion

bank loans.
UnderwriterMr-To be determined by .competitive bidding.
Probabld biddelrs: Halsey; Stuart & Co. Inc.; Blyth & Co.,
Inc.; Merrill Lynch, Pierce, Fenner & Smith and Kidder,
Peabody & Co., Inc., (jointly); and Blair & Co., Inc.

or

(9/2-5)

insured

government

(CDT)

sell

bonds

issue

to

be received

expected to

March 24 it Was announced the

program

approximately $18,000,000 of
secured ;by first preferred
ship mortgages on the new "Santa Rosa" and "Santa
Paula." The financing will comprise two issues of $9,000,000 each. Underwriters—Merrill Lynch, Pierce, Fen¬
ner and Smith; Paine, Webber, Jackson & Curtis; Smith,
Barney & Co.; White, Weld & Co.; and F. Eberstadt &
Co., all of New York. Offerings—"Santa Rosa" offering
plans

are

noon

ler.

stockholders, also to offer certain shares on the same
terms to employees, including officers, of System com¬
panies. Clearing Agent—Merrill Lynch, Pierce, Fenner
& Smith, New York.
Grace

(8/14)

by this company up
Aug. 14 for the purchase from it of
$4,275,000 equipment trust-certificates.
Probable bid¬
ders: Halsey, Stuart & Co. Inc.; Salomon Bros. & Hutz¬

to

to

•

Pacific RR.

Missouri

Bids

by competitive bidding,
Halsey, Stuart & Co. Inc.;

approved

directors in connection with

this subsidiary of;
applied to the Fed-'

mortgage

Utilities Corp.

stockholders

that

announced

eral

c

determined

If

—

it.-was-

24

Tennessee Gas Transmission Co. has

Bids—

Montana-Dakota

loans

and

Enterprises, Inc.

28, -company announced it plans to issue on or '
1958 $3,200,000 of first preferred mort¬
gage bonds.*. May be placed privately.
Proceeds — To
repay bank loans and for working capital.

was

Underwriter

company

before Dec. 31,

reported that company plans to issue
$11,000,000 of first mortgage bonds later this year. No de¬
cision as yet has been made as to the procedure the com¬
pany will follow.
Proceeds—For repayment of shortterm

^V-'".' ';Y-

•

Fund, Ine*,. Fairfield, Calif.
Jan. 27 it was announced this newly organized invest-/

Service Co.

March 24

iV-

Master

Equitable Gas Co.
July 18 it was announced that the company expects later
in the year to issue and sell additional securities, prob¬
ably preferred stock, to secure approximately $5,000,000
of additional funds. Proceeds—Together with $7,000,000
from private sale of 4V2% bonds, to repay short-term
bank loans and for construction program. Underwritem
—May be The First Boston Corp.; Kidder, Peabody &
Co.; Merrill Lynch, Pierce, Fenner & Smith; and White
Weld & Co., all of New York.

ing of

stock, to provide

Office—75 Pitts St., Bos¬

debenture; financing.

ton, Mass.

Probable bidders: Morgan

bidding.

First Boston Corp. and Harriman

present mortgage debt and preferred stock with

new

of

000

March

Gulf Interstate Co.

a

'Harding, President, announced that;
currently considering refinancing $790,-outstanding notes ($658,750 held by a principal
Henry

Midland

Power Co.

was

June 5 it

mfte and -two new issues of preferred

r

the directors .are

Sept. 23.

on

Consumers

Basic, inc., Cleveland, O.
Aug. 2 ft was announced stockholders on Aug. 28 will
yoW upon a refinancing program intended to replace
<

,

,

Laboratory for Electronics, Inc. -•>

Feb. 19 it

country contemplates

16 company stated it;Will sell bonds and/or com-,
in thO^last quarter of 1958. Underwriters—

stock

mon

California

Great Atlantic & Pacific Tea Co.

Austria (Republic of)

-

by competitive bidding; • Probable bidders;
Halsey, Stuart &, Co. Inc.; The First Boston Corp.; Glore,
Forgan & Co.; Harriman Ripley & Co. Inez, White, Weld
& Co.; Blyth,& Co.;vIn&; -Equitable. Securities Corp.
- "

ment

Inc.; Morgan Stanley & Co.; White, Weld & Co. and
& Co. (jointly); The First Boston Corp. and
Harriman Ripley & Co. Inc. (jointly). Bids—To be re¬
Shields

Inc., New York.
July 155 it

and

Pro-

Underwriter—To be

construction .program.

determined

Co.

General Public

that the company plans addi¬

$10,000,000 of Jiirst mortgage bonds due 1988.

sell

competitive bidding. Probable bidders: Halsey, Stuart &

April

was announced

Light Co.
announced company plans to issue

was

ceeds—For

Lynch, Pierce, Fenner & Smith, and White.
(jointly); Blyth & Co., Inc.; The First Boston
Corp.; Lehman Brothers.

Steel Co.

March 21 it

14 it

Feb.

vertible

was

probable

Prospective Offerings

competitive,

by

Weld & Co.

bank

%*•'

G/Wv Evans, Chairman, announced that com--'
plans to1 sell some bonds originally scheduled for
mid-year, ^ut^^hich sale may now be deferred until
late 1958 or early 1959. Proceeds—About $8,000,000 for

Merrill

Acme

■r.//',..•/■'

Kansas 'Gas & ■ Electric Co.

announced that the company plans to issue
and sell not more than $40,000,000 of first mtge. bonds
due 1988. Proceeds—For expansion and improvement of
service facilities.
Underwriter—To be determined by
July 17 it

Expected to be received

of

15,..^/' • r-/.?d "i*; T/ 0 / *•

Sept.

on
'

stockholder arid ,$131,250 by a bank) on a mote perma¬
nent basis. ,This> may be done through equity or con¬

Westland Oil Co., Minot, N. Dak.
April 17 filed 7,799 shares of capital stock to be offered
for "subscription by stockholders of record March 24 at

excess

White Weld & Co.

sale

White, Weld & Co. and Shields & Co. (jointly).

additional

bidders:^ Halsey,

March 31,

bank loans.

repay

-

Stuart & Co. Inc.; Lehman
Merrill Lynch, Pierce, Fenner & -Smith and
(jointly); Stone & Webster Securities5,
Corp.; and Saljqmon Brps. & Hutzler and Eastman Dillon,
Union Securities, & Co., Bids—Expected to be received

July 14 it was announced company contemplates mar¬
keting between $5,000,000 and $7,000,000 securities in
October, 1958.
Neither the exact date of the offering
nor the nature of the securities to be offered has been
determined.

(9/15)

was

Brothers;

derwriter—None.

rate of

it

28

outstanding $17;000,000 issue of 4%%- bonds due 1987. *
Underwriter—To be determined by competitive bidding.

\

Electric Power Co.

California

Oct.

stock at the rate of

ment.

preferred stock financing.

of the company and its subsidiaries

amcwntmg to approximately $43,000,000 for the period
1958-4960. Underwriter—To be determined by competi¬

.

improvements, and provide additional working capital.
Underwriter—Hallgarten & Co., New York, handled last

Central

Utah Oil Co. of New York, Inc.
May 6 (letter of notification) 300,000 shares of capital
stodfc. Price — At par ($1 per share). Proceeds — For
development of oil and gas lands. Office—574 Jefferson
Ave., Rochester 11, N. Y. Underwriter—Frank P. Hunt
& Co^ Inc., Rochester, N. Y.

1988.

loans

Thursday, August 14, 1958

.

pany

City, Utah.

•

bank

.

announced that the company plans to
issue and sell $17,000,000 of first mortgage bonds due
1988.
Proceeds* -.-Will be used to retire its presently
July

under way since early this year,
that had been made to finance the

improvements

retire

Portland, Ore.

.

Gulf States Utilities Co.

with which to complete,1

about $3,325,000 of new money

plant

April 30,1957 filed 1,250,000 shares of common stock(par
16 cents). Price—To be supplied by amendment (ex¬

June

Chronicle

The Commercial and Financial

(638)

New

~

on

York

'

-

.

5tate Electric and Gas Co.

v V

approximately $7,500,000
from additional Hnancing will be required for construe*
tion expenditures for the balance of this year. The man¬
agement intends to negotiate a new line of credit with a

March 7 it

was

announced that

Volume 188

Number 5768

.

The Commercial and Financial Chronicle

.

.

group of banks and expects to sell

equity securities later
early 1959, depending upon, prevailing
market conditions. Underwriter-—For any common stock:
this

year

The First Boston

Corp., New .York.-' •<{•, • '

A Norfolk & Western Ry.
Bids

summer."
The stockholders on May 21 voted on
authorizing an increase in bonded indebtedness of $6,500,000, and an increase in preferred stock from 25,000
shares to 50,000 shares. Proceeds — For
repayment of
this

in

or

"■ Api-2 A

'

short-term

(8/20)';A^AA-*:NA''

& Hutzler,

;June

Illinois Gas Co.

:

.

Sanborn

:

10

it was announced company will sell this
Sep¬
$20,000,000 mortgage: bonds providing new gas
supply from Northern Natural Gas Co. is approved by

Aug. 4 it

tember

$90,000,000 outlay. Underwj"iteivATo be
competitive bidding. Probable bidders:
Halsey, Stuart ;& Co. Inc.;-1 First Boston, Corp.pGlore,
;Forgan & Co.; Blyth & Co., Inc.^ :A;':AAaA;'A
Pacific

A. Pacific

Gas & Electric Co.
it

«

accounts

common

.

stock, of which it is

a

j;).:--?

larger portion of the company's

Underwriters—Goldman, Sachs &

Southern Colorado Rower Co.

,

reported company plans sale;of aD
amount- of .bonds and/or preferred stock

May

stockholders

9

shares-of

in the latter part of this year or
early 1959. Underwriter
—(1) For bonds to be determined by competitive bid-

Stone

&

authorized an additional 100,000
stock
(par $50).
Underwriters—
Securities Corp. and Paine, Webber^

preferred
Webster

Jackson & Curtis.

ding. Probable bidlers: The First Boston;'Corp.;-Halsey,
;Stuart & Co. lire':; Blvth & Co., Inc.; (2) Tor preferred
stock: Blyth Sc. Co.; ln&
v-' -f-

Southwestern

July 10 it

Pacific Telephone •& Telegraph Co.
000

./AAAAA.' A
reported company plans abopt $250,000,financing late this year- (part in bonds ,and bal¬
in common stock). Proceeds—for construction
pro¬
was

issue.

of

ance

Panama

July. 14 it
•of

approximately $26,OOOjOOO external bonds.

To

redeem

Proceeds—

None.;

stockholders

later' this

.AAA?-'-.. AT"?-A-A..-A

•

:

:

sion for authority to issue add sell 242,826 'shares of
of convertible preferred stock

i

$100)

(par

Inc.,

Miami, Fla.

(9/9-10)

reported that company plans early regis¬
"50,000 shares of $25 par value convert¬

was

preferred stock. Underwriter—R. S. Dickson & Co.,
Inc., Charlotte, N. C.
•

Thiokol Chemical Co.

I

(9/5)

Aug. 4, J, W. Crosby, President, announced company is
planning to offer to its common stockholders some addi¬
tional common stock (approximately 105,488 shares) at

new

to

Markets,

—

ible

A~'A*- AaA'/

series

the rate of

be

one

offered for subscription by common stockholders on the
basis of one new preferred share for each 20 common
shares

share for each 12 shares

new

ably this fall.

held, prob¬
is also being con¬
Peabody & Co., New

York.

held

as

of

Sept, .16,

sidered.

1958;

rights to expire on
loans.
Underwriter
—Blyth & Co*, Inc., New York and San Frandiscb.
Oct.

6.

Proceeds—To

reduce

bank

occasion.

two

about

construction program.

This

of

week, for

the

firms

four

ings

of

debt

new

to

securities

withdraw

the

de¬

projected

offerings.
naturally concluded that
propitious market conditions

would

develop later which would

allow

The

itself

confusion
week

ket

capital

corporate

found

as

in

the* early

new

part

the Treasury

extended, its

low7

of

utter

bOiid

long

If the

I

mar¬

decline

to

levels/forAthe^year A A:
Y~.v.

A/-.-'" •
'1
behavior of' the) govern¬

ment bond market

to

this

of

-

arises,,

Both other

routing of

to

been
of

the;

these

debt

something
about the situation; A A
'

•

"

-

;VAA

the 10 percenters, should be made
to face up
to the same margin

requirements
There

the

is

as

other traders.

little

especially
new

3

quent
riders"
creates

(4s

has proved

on

the

and

occasion

2As,
unloading
of
or

the

the

the

tit

the

subse¬

the

"free-

speculative

fringe,

such- disturbance

as

it

had

last

week

Utah Power

until

Sept.

Montana

9.

And

Power

with¬

vorable
ment

naturally
behavior

markets,

by
of

the
the

corporate

was

unfa¬
invest¬

as

well

government.

Cons.

has

Corporate borrowers have been
penalized along with the Treasury

Natural

Consolidated
the

4(2%

a

price

101.142

of

opening

4.30%. This

the

of

books,

Fund

week's

in

October.

mid-Autumn,

less

you

for the

program

country.

gram a short-term credit is

in

government

be the fiscal agent for

new

the

financing involved

credit.

is in the

000,000.

The

Petrofina

950,000

Inc.

Wisconsin
March 17 it

Power

was

&

—

Probable

bidders:

share

Mills

offering

common

the

start

while

Halsey,

by competitive bidding.
Stuart & Co. Inc.; Smith,

Barney & Co. and Robert W. Baird & Co., Inc. (jointly);
Equitable Securities Corp. and Eastman Dillon, Union
Securities & Co. (jointly); White, Weld &
Co., Kidder,
Peabody & Co. and Salomon Bros. & Hutzler
First

(jointly);

Boston

late in 1958

or

Corp. Offering—Not expected
early in 1959.
A

Wisconsin Public Service Corp.
March 4 it

$12,500,000
rent

on.

The

type of securities has not yet
Underwriter—To be determined by

week

Natural

the

Tuesday

on

on

rities

8c Co. and Salomon Bros. 8c Hutzler
{jointly);
Kuhn, Loeb 8c Co., and American Securities Corp.
(jointly). (2) For any preferred stock—Merrill Lynch,
Pierce, Fenner 8c Smith; Salomon Bros. 8c Hutzler and
Eastman Dillon, Union Securities 8c
Co., (jointly); Leh¬
man Brothers; Kuhn, Loeb 8c Co. and A. C.
Allyn & Co.
Inc. (jointly); The First Boston Corp.;
White, Weld St
Co.; Kidder, Peabody & Co.
;

Wizard Boats of

Tennessee, Inc.

July 28 it was reported that the company plans an offer¬
ing of 150,000 shares of common stock and 75,000 war¬
rants, which are expected in units of one common share
and one-half warrant. Price—$2 per unit. Underwriters
—Clark, Landstreet 8c Kirkpatrick, Inc. and W. N. Estes
8c Co., both of Nashville, Tenn.
'A -A 1

■z
«
to

£>

Standard

(N. J.) will be seeking to
exchange 11,406,078 shares of its
on

a

Oil & Refining

basis of five SONJ for

four Humble..

^

~

Gas

scheduled

Two With

(Special to The Financial Chronicle)

an issue, $45 million of
debentures, stuck to its
schedule, presumably encouraged

by

the

on

Tuesday.

rally in governments late

The debentures

drew

a

bids, the best fixing

100.1599

for

a

4%%

total
a

of

price

coupon.

Plymouth

MIAMI, Fla.—Jack Grover and
Robert A.
to

the

Hand

staff

have

been

added

of Plymouth Bond &

Share Corporation, Ainsley Build¬

ing-

—

\

is slated
Monday

;

been
com¬

petitive bidding. Probable bidders: (1) For any bonds—
Halsey, Stuart & Co. Inc.; White Weld & Co.; The First
Boston Corp.; Kidder, Peabody 8c
Co.; Merrill Lynch,
Pierce, Fenner 8c Smith; Eastman Dillon, Union Secu¬

"

100,000

-~~

announced company plans to sell about
of new securities in the last half of the cur¬

year.

decided

until

was

re¬

Oil Co.

stock
Debentures

Inc.'s

Un¬

To be determined

an

$6,-

Proceeds—

program.

derwriter

mov¬

sell

the

Light Co.

po¬

of debentures.

Pill^bury
to

to

due

of

announced that company plans to issue

expansion.
is

amount

neighborhood of $250,-

The purpose is to restore government
balances
which have been reduced
by the repayment of excessive
short term obligations
previously incurred.

"

American

in

a

of schedule and pro¬

too,

later;

late

cooperation

new

Wednesday,

probably

with the two investment
syndicate of commercial banks In
States, Canada and the United Kingdom.
The three institutions which are to
head this syndicate
are The Chase Manhattan
Bank, The First National City
Bank of New
York, and Bank of America National Trust
& Savings Association. The Chase
Manhattan Bank will

Corp.'s $60 million
bonds, due up for bids on
Wednesday. If this issue goes to
market on schedule it will permit
retirement
of
$10,000,000
bank

On

American

named

United

rather

funds for

Su¬

As a first step in the pro¬
being negotiated between the

of

vide

the

be

State

Proceeds—-

(Government of)
July 1 the Government announced that
Kuhn, Loeb Sc
Co. and
Kidder, Peabody & Co., both of New
York, have
been selected as
financial advisors to develop a financial

Electric & Gas

loans ahead

stock

•(

debt offering
negligible un¬
included Public Service

is

calender

York

of

Underwriters—To

Expected

Looking Ahead
Next

stock for Humble
Gas

was

25-year

of

Society.

—

the New

Research

ing well.

Co.,
only other- utility which had

three

Chemical

Offering

with

(expected within two months).

Petroleum

are-

for

ported brisk with the issue

Tuesday and

In both instances the action

dictated

the

Triple A rated issue attractive, for
preliminary inquiry, prior to the

on

rescheduled the issue for Aug. 26.

currently.




had
Each

drew its call for bids which would

new-

case,

of

which
week.

for

appear,

heavy oversubscription of its
as

this

(p set back its proposed

Monday

as

consolation

Treasury, it would

issues, if

volume

utilities

late

decided

for

were

indicated yield of

Power

Light Co.,
offerings just

have been opened on

•

Recurring misettlement in the
Treasury market, certainly .sug¬
gests that the "shoe-string" boys,

a

securities.

But

has

do

on

planned to
take bids for $20 million of new

time

to

funds

Montana

new

halved

tive

come-

by

scheduled

burdensome specula-;
offering
interest,
then', perhaps
the
a,

obtain

Utah Power &

postpone

about

bids

The successful group fixed

offering:

the

Co. and

as seems,

be generally believed, from

to

Decisions

market

state

a

them

satisfactory basis than might
case currently.

more

be

To

tential return apparently made the

They
more

transaction rests

rate.

which had scheduled public offer¬
cided

Co., St. Louis, Mo.

was announced
company plans to market
$30,000,000 of common stock in the latter part of
this year or in the first quarter of 1959. Proceeds—For

Joseph Light & Power Go. •
AAA !•
15 it was announced that the compauj plana to
market $6,509,000 in bonds, or preferred stock "sometime

this

Underwriter—Kidder,

March 28 it

St.

April

example,

Long-term financing

Union Electric

.

on

the

preme Court

The

(Indiana)

tration of about

• Public Service Co. of Indiana, 1nc.<H9/17) A
July 30 company applied to the Indiana P.- S. Commis¬

.

Stevens

July 31 it

year. AUnderwriter—
:

Halsey, Stuart & Co. Inc.;

Morgan Stanley & Co., New
Offering—Expected in the early Fall.

York.

•

to

Oil Co.

Underwriter

purposes.

certain

Peoples Gas Light & Coke Co. A A'A i:
Aug. 1 the directors approved a program: for. the offer¬
ing of approximately, $17;000,000 of additional /capital
stock

To be determined by competitive

—

bidders:

July 30 it was announced company has under considera¬
tion long-term financing through a
public offering of ap¬
proximately $200,000,000 of debentures. Proceeds—Prob¬
ably for expansion, working capital and other corporate

outstanding debt and for Panama's
feeder road program.,
Underwriter—Lehman, Brothers,
New York.' f.
AAA-'-; f. ■

•

Probable

Standard

.'-a ..A, -A
public-offering,is, expected

a

run

of

common

public, the proceeds of which
between $50,000,000 and
$60,000,000. Approval

$10,000,000 of first mortgage bonds.
To retire bank loans and for construction

(Sf/30)

Morgan Stanley & Co.

by com¬
Halsey,; Stuart &

(Republic, of"

was announced

Telephone Co.

was

Underwriter

bidding.

gram. Underwriter—For bonds to be determined

petitive'bidding.) Probable bidders:
Co. Inc.;, Morgan Stanley & Co.

Bell

announced Missouri Public Service Com¬
mission authorized the company to issue $110,000,000 of
35-year debentures. Proceeds — To refund outstanding

,

July 31 it

may

of

be offered to the

and sell

•

•

soon

the

Halsey,' Stuart & Co. Inc. and Lehman Brothers,
of New York. Offering—Expected in
September.

all

will

banking firms and

Proceeds—To expand retail and mail order

receivable.

^ Universal Oil Products Co.
Aug. 13 it was reported that an issue

43

Venezuela

Co.,

was

undetermined

-

(Mass.)

reported company plans to issue and sell

was

activities and to retain

William

—

•March

20

program

Aug. 5, Charles H. Kellstadt, President, announced that
the .company will issue and sell
$350,000,000 long-term

H.fStaats & Gof^ Los1 Angeles,
(>ffering--^Expected aroui"Ki Sept: 15. UTt^v':- * A A '■

-

Scientific instrument Co.

debentures/

Products,j Inc A* 'A ;*< VAA; /
♦July 28 it was reported that?the company)plans early
•registration, of about 125,000 share's of - comirjpri stock,
-Calif.

construction

determined

Sears, Roebuck & CoAA

.

AutomationJ

'Underwriter

for

be

to

.

calls for

determined' by

•

and

intended to offer 17,000 shares in exchange for out¬
standing preferred stock. Underwriter—Paine, Webber,
Jackson & Curtis, Boston, 'Mass.
Offering—Expected in
October,'-1958.
•
'"--AA:A';. ' ", .VA'
"•

pro¬

.

loans

1OU.0Q0 addi tional shares of

-Federal Power Commission. In event this1
project has to
;be deferred, company will likelyissue
$10,000,000 bonds
later in the year.
Company's 5-fyear construction-

gram

bank

by competi¬
tive bidding. Probable bidders:
Halsey, Stuart & Co. Inc.;
Smith, Barney & Co., Glore, Forgan & Co. and Blair
& Co. Inc. (jointly); White, Weld &
Co.; Equitable Secu¬
rities Corp. Last preferred financing was done
privately

able bidders: Halsey, Stuart & Co.' Inc.;* Salomon Bros.
Northern

i

Underwriter—For bonds

are

expected to be received by the company up to
noon
(EST) on Aug) 20 for the purchase* from it of
$2,310,000 of series D equipment- trust certificates; Prob.

(639)

KH

JfJH

rn

CO

:

The Commercial and
44

Financial Chronicle

.

.

Thursday, August 14, 1958

.

(640)

Inter¬

troduction of tranquilizers.

Adds

H. M. Frumkes
with

sociated

Mutual Funds

M. Frumkes &

H.

New York
New York
registered

120 Broadway,
City, members of the
Stock
Exchange,
as
representative.
Co.,

700 series of

FUND

Polaroid, Smith, Kline &

High
Readied By I. CI. A.
assets

Total

new

of

French,

during the period were

stock was

whose

Companies

eliminated entirely from the port¬

and

Railway

Co.,

pre¬

Keystone Tax
Exempt
Bond
(Series B-l) has filed with

Fund

the SEC

ing in "growth" stocks

value

the years.

over

Bond for

a

free book¬

let-prospectus by
mailing this advertise¬
ment to

CALVIN BULLOCK,

LTD.

Established 1894
ONE WALL ST.,

NEW YORK 5

by President Jonathan
in

Lovelace

B.

his

semi-annual

the shareholders.' Net
assets per share increased to, $8.54
for each of the 12,372,764 shares
to

report

Incorporated Holds
Insurance Stocks

outstanding June 30, compared to
$7.58 a share on the 11,708,464
shares outstanding Dec. 31, 1957.
Net assets of Incorporated In¬
This represents an increase during vestors increased from $217,000,the
six-months period of 14%,
000
to
$238,000,000 during the
after adjusting for the capital gain
quarter ended June 30, 1958 ac¬
to
distribution of 10 cents.
cording to the Fund's 130th Quar¬
Net income for the six months
The Johnston Mutual Fund Inc.
terly Report to Stockholders. Net
ended June 30, 1958, excluding asset value
per
share increased reports net assets June 30, 1958, of
realized gain on sales of securities,
$6,405,342.97, equivalent to $20.25
from $6.94 to $7.55.
was $1,483,479, equivalent to 12.3
In the message from Chairman per share on 316,340 shares out¬
cents per share on the 12,067,449
This compares with
William A. Parker and President standing.
average
number of shares out¬ Charles Devens stockholders were $5,733,739.45, or $18.73 per share,
standing during the period. This advised of the reasons why im¬ on Dec. 31, 1957; and with $6,148,net income compares with $1,374,portant additional commitments 259.40, or $21.56 per share, on
9.99 for the six months ended June
were
made
in insurance stocks June 30, 1957, on shares outstand¬
30, 1957, equivalent to 13.1 cents
during the period. These commit¬ ing at these respective dates. A
per share on the lesser number of ments were
largely in life insur¬ capital gains distribution of $0.46
shares outstanding during that pe¬
ance
companies, but also in the per share was made on Dec. 20,

In

riod.

,

June

On

High Favor

Johnston Mntual

Addi

30,

Investment

The

fire and casualty segments

ess_

confidence

the

reflects

of

the

industry

$20.25

EITHER PROSPECTUS

are

l

FREE ON REQUEST

the

and

"We

l

|' Incorporat ctl

of the opinion," he
the
business
decline

of

ued

said,

|

A mutual fund invested in a

|

list of securities selected for

|

-

recession

level

capital and income.

added

and

quarter

the

the

the

Fund

following securities to

its

portfolio: Commonwealth Edi¬
Co. 3%%, March 1, 1988; Ten¬
nessee Gas Transmission Co. 514%,
son

are an

increasing

pop¬

concern

Prefei-red; South Carolina Electric
and

higher incomes plus

value of the dollar:

to

offset

Gas Co.; U.

S. Foil Co. "B";

Kodak

Eastman

legislation is presently pend¬

ing before Congress and it is an¬
ticipated will be enacted prior to
the adjournment of the present
session.

•

Brothers

Lehman

will

manage

the

underwriting and will form a
nation-wide underwriting group.
is

fund

The

covered

shares

statement

tion

open-end and the
by the registra¬
will be offered at

fixed price of $20 a share,
subject to adjustment for quan¬
tity discounts, during the period
of the underwriting. The fund is
a
continuation of Keystone Cus¬
the

todian Fund,

since

tion

Series B-l, in opera¬
as
an
open-end

1935

investment

diversified

company.

of Keystone

Cus¬
(Series B-l) in an¬
ticipation of the new legislation
have approved amendments to the
Trust Agreement to make it pos¬
sible for the fund to operate as
a
tax exempt fund.
Prior to the
closing the fund will distribute
to its present stockholders such of
its
portfolio of non-tax exempt
bonds so as to permit its opera¬
tions as a tax-exempt fund.
It will be the policy of the fund
todian

Fund

Co.; American
Cyanamid Co.; General Electric to confine its investments to tax
Co. and Youngstown Sheet and exempt obligations, except that,

greater security and
about the future of the

necessary

Gas Transmission Co. 5.16%

nessee

the desire for

people feel it
the declining

from the pending investment in tax-exempt
Commonwealth securities, assets may be held in
Co. 4*4%, March 1, 1987; cash or temporarily in obligations

Eliminations

Co.

Tube

portfolio

buying power of the policies they
now own by increasing the amount
even
of their existing policies. Longer

longer before growth is resumed.
Because of the uncertainties in the

possible long-term growth of

|

pre

growth

ulation with

has

a snow¬

however, it may be a year or more
before the business returns to the

1025

During

our

Factors contributing to its contin¬

values.

balling recession averted, and that
irregular improvement has begun;

Investors

I

stocks

many

been halted, the danger

I

ESTABLISHED

that

fundamental

to

are

"that

I

belief

Co.

Such

Stockholders

judgment life insurance July 1, 1977; Texas Co. 3%%, May
1983; Eastern Industries, Inc.
is a true growth situation," the 1,
Chairman and President report. $0.70 Convertible Preferred; Ten¬
"In

selling at attractive prices in

relation

1957.

follows:

as

Insurance

management in the longterm future of American industry

Fund's

•

of the

Aetna Life
Company of America was 77% in¬
Insurance, National Life and Ac¬
vested
in common
stocks.
Mr.
cident Insurance, Travelers Insur¬
Lovelace stated that this position
ance
Co., and Fireman's
Fund

Name.—

a

of America reached a
& Light, Ex-Cell-O, Lone Star Ce¬
new high of $105,668,971 on June
ment, National Theatres, Republic
30, 1958, compared to $88,737,452
at the beginning of the year, it was Steel, and Westinghouse Electric.
Company

—$18.73

selected for their pos¬
sibilities for gain in

covering

statement

proposed public offering of 1,250,000 shares of capital stock of the

Share Value Rises

A mutual fund invest¬

amendment to its reg¬

an

istration

during the quarter included ferred, Merck and Co., Signal Oil fund at $20 per share. The financ¬
& Gas Co. and White Eagle Oil Co.
ing is contingent upon passage of
Sales were made in Hancock Oil
legislation which permits an in¬
Co. while Bridgeport Brass, B. F.
vestment
company
whose assets
Goodrich, Hudson's Bay Oil and are almost exclusively in tax ex¬
Gas Co., Ltd., Koppers Co., Magma
empt securities (more than 95% of
Copper, National Lead, New Jer¬ its
gross income must be derived
sey Zinc and the debentures of from such securities) to distribute
J. Ray McDermott and Co. were
tax free to shareholders, its net
entirely sold out of the portfolio. income from tax free securities.

folio

The Investment

Northwestern

made

were

Chicago

in

commitments

to

Michigan

and

Co.

Additions

Chemical.

United Fruit.

and

Tax-Exempt Fund

giant computers.
commitments to the

Union

Grand

Issue to Finance

Bethlehem Steel, Delaware Power

announced

BULLOCK
A

Other

By ROBERT R. RICH

Record

Keystone Registers

earnings

portfolio

Form Southern Securities
JACKSON,, Tenn. — Southern
Securities has been formed with
offices at 105 South Market Street
to engage in a securities business.
Carroll H. Little, Jr. is a principal.

per

increased from
$2.78 to $7.54 in the five years
following the introduction of its
share

become as¬

Donald F. Du.be has

Machines'

Business

national

Edison

were:

Tennessee

Transmission

Gas

Co.

of the U.

S. Government.

gives insurance 314%, Feb. 1,1975; General Motors
Acceptance Corp. 312%, March 1,
international situation and the be¬ companies additional years to re¬
ceive premiums over and above 1979; Buckeye Pipe Line Co.;
lief that
the increasing rate of
which they expected since a great Chrysler
Corp.
and Stone and
business activity will not of itself
;
amount of life insurance presently Webster, Inc. Major increases were
fully relieve the profit squeeze
in force was written on the basis made in the holdings of Merck and
which many companies are expe¬
of mortality rates now obsolete.
Co., Schering Corp., Royal Dutch
riencing, we have considered it
The report also throws an in¬ Petroleum Co. and Polaroid Corp.;
Future Planning Corp., now in
prudent and potentially profitable
teresting light on the importance a major reduction was made in its 34th month-of operation, has
to hold a substantial proportion of
of research as a key to many long the holding of Kaiser Aluminum
filed three new investment plans
the
company's assets in highly
and Chemical Corp.; and holdings
range investment opportunities.
with the Securities and Exchange
liquid form."
The significant rise a company's of other securities were increased
Commission
New names added to the port¬
earnings may have as a result of or decreased slightly during the for the accu¬
folio during the quarter just ended
discoveries
and
developments period.
mulation
of
include
Abbott Laboratories,
shares of PioAmerican Airlines, Borden, Bruns¬ through research is illustrated by
Smith, Kline and French whose
neer Fund,wick - Balke - Collender, Celotex,
I F Shares
earnings rose from $1.01 per share
Inc., o n e o f
Coca-Cola, Colgate-Palmolive, The to $4.24 per share in about four
the
oldest
43
Grolier
Society, Martin, Pfizer, years largely as a result of the inmutual
funds
life

expectancy

Future

Planning

Announces New

'

I

Incorporated
I ncome Fund

^

A mutual fund

I

list

I

income.

investing in

....

^
I
I
*

a

of securities for current

I

1

Investment Plans

A prospectus oil

each

fund is available from
your

J

C

investment dealer.

H

200

|

Show

Cain of

The Parker Corporation

In First Ten Weeks

Boston, Mass.

Shares

Get the facts
You

can own

Cents

~

Berkeley Street

on

ment

of

Fund,

Consumers
a

new

Invest¬

mutual

fund

headed

by Dan A. Kimball, for¬
merly Secretary of the Navy and
now
President
of
the
Aerojet-

YOUR share

FRANKLIN

of American business

through

General
available

CUSTODIAN

FUHDAMENTAL

Corporation,
are
now
through registered

South Carolina

securities

dealers.

The

INVESTORS

FUNDS

mutual fund investing
in common stocks. For copy
...

of

objective of the*Fund is to
promote the interests of the con¬

a

sumer
new

as

investments

prospectus-booklet of
Fund, mail
this coupon today.
a

Find out

now

about this series of Mutual Funds

to the

possible growth and income through investment in Amer¬
ican

came

FRANKLIN CUSTODIAN FUNDS, INC.
64 Wall Street, New York 5, N. Y.

when

the

shares

first

available to the public.

be¬
-,

With Carroll Sees.

Please send me, without obligation, the Prospectus

INC.

dollar.

public offering price of CIF
on
Aug. 7 was $5.99, an
increase of 43 cents in the past 10
weeks

AND COMPANY,

their contribution

consumer

shares

Name—

mation

in various industries

The

industry.

Address-

I

investor. The Fund's

in proportion to

seeking

facts about the

HUGH W. LONG

an

investment approach calls for

and other infor-

(Special to The Financial Chronicle)

concerning the Franklin Custodian Funds.

BROOKLINE, Mass.—Roland A.

I

Pettinati

is

now

affiliated

with

NAME-

Elizabeth 3, N. J.




Carroll

|
27

ADDRESS-

I

crrv_

Securities

Beacon

I

Street.

with Investors
-ZONE-

tion of New

-state•

Company, 1731
was formerly

He

in

United

the

States, Karl
D. Pettit, Jr.,
of

President

Plan-?

Future
n

i

g,

n

n-

a

nonnced.

'

The purpose
of

the

.

;

service
thoroughly the varied needs
the investing public, Mr. Pettit
to

more

of

He stressed that F.

stated.
would
ment

of

to

continue

offer

P. C.

invest¬

plans for the accumulation
of The Knickerbocker

shares

Fund
was

and

that

organization

his

adding plans for the purchase

of Pioneer Fund shares in answer
to

a

strongly

felt

need

among

large segments of investors.
Incorporated as ap investment
company in 1928, Pioneer Fund,
Inc. currently has assets in excess
of

$24 million which represent an

interest

in

a

broad

American industry. Mr.

section

Pettit

of
ex¬

plained that one of the principal
reasons for Future Planning's* se¬
lection of Pioneer Fund, shares as

Planning Corpora¬
England* and Palmer,- theunderlying

Pollacchi & Co.

Pettit, Jr.

K*1"*

new

filing is to enFuture Planning

able

firms' three

new

security

for j the

investment plans

Volume 188

Number 5768

.

.

.

The Commercial and Financial Chronicle

(641)
the outstanding job done over

was

the years by Pioneer management
in maintaining its objectives of

growth

of

principal

and

reason¬

30% Sales Gain for

Dividend Shares

Broad St.

Reports 13.3%

able income.
He

good

situations.

of

Gross sales of

Pioneer's

man¬

has
constantly
sought
values in special types

agement
out

that

noted

Securities

lesser

of

known

companies, where some¬
thing special was or is about to
happen which would enhance the
financial well being of those

com¬

panies, have been the objective of
Pioneer's
Mr.

Pettit

sults

for

management

said,

date

to

adding

indicate

years,

that
that

re¬

this

policy has been quite successful.
The

Chemical

Bank will act

Corn

Exchange

the custodian. To

as

further meet the needs

tors,

Future1

ranged

with

has

Life

the

inves¬

of

Planning

ar¬

Insurance

Co. of North America to offer in¬
which

surance

would

guarantee

completion
of
investment
pro¬
grams in the event of the Planholder's
of

death

to

up

a

maximum

$30,000.
Future

Planning Corp. will of¬
fer the new plans on a national
basis through its own retail oper¬
ation

there

and

tribution

will

also

be

dis¬

through selected broker-

dealers.
Future Planning Corp., with of¬
fices in the Empire State Build¬

ing, 350 Fifth Avenue, New York
City, is a member of the Asso¬
ciation

of

Mutual

Fund

Plan

Sponsors, Inc.

Wellington Sales

Broad

Street

nor

Group
shares of the

new

Group

of

sales

$2,615,000 in July to
gain of 30% over June

a

of

$2,001,000, according to
Milton Fox-Martin, President of
Broad
Street
Sales
Corporation,
national

distributor

the

of

shares

of
Broad
Street Investing
Cor¬
poration, National Investors Cor¬

55%

the

three

greater

than

Funds

those

fact

that

month

sales

for

included

dends

of

the

the

earlier

$316,000 of divi¬

Broad

Street

funds

Street funds and

came

within $19,000 of the record set in
January 1957. As compared with

July 1957, this year's total repre¬
sented a gain of about 53%.
"This
the

part

ment

of

independent

dealers

established

strong

interest

of

up-surge

and

on

' funds

This represented an

million

$4

over

is

tors have confidence in the future

earnings

prospects

American

of

with

parable

July figures

July

1957

The

$12,225,000

record

volume

con¬

of selected

corpora¬

professionally man¬
mutual funds," the Broad
specialists

of

The

turning

in

and

investing
greater

an

profes¬

public

numbers

is
to

mutual funds for the

professional
management of their invested dol¬
lars

just as they look to
lawyers for the handling of legal
.

.

months of

1958.

July totals, comparable sales

matters—doctors for medical

—accountants for tax

care

finan¬

and

cial services."

months of 1958

First seven months of

$65,758,001

1957——

Increase

The
of

1957

55,011,907

$10,746,154

increase

over

19%

a gain,
with the

represents

compared

seven-month

period.

Chemical Fund's

Service

investment

on

was

Corp.,
mar¬

March 28, 1958 was $5.20

equal to $4.92 per share.
report also compares

The

the

current asset value of $5.61 per
share with that of $5.42 per share
on

June 30

of

the

were

a

year ago,

standard

at

when

market

higher level.

a

out that such

a

of

14

It points

comparison should

cents

per

share

from

realized net gain on investments.
At June 30, 1958, holdings of

utility

common

its

stocks represented

asset

with

share

of

ended

13.3%
June

in

the

30,

1958,
Mr. Bullock said. On June
30, the
company owned common stocks of
103 corporations and
eight U. S.

Government

bond

issues.

The

principal equity holdings were in
the petroleum (16.15% of
assets),
public utility (15.59%,), and..chemr
ical and

drug ,(7.40%) groups.

"The

economic

home,

which

trends

during

first

half

ol

stabilizing
segments,"

situation

showed

allwith

20

only ^100,000

in

time,

same

it

was

also

in

June.

late

1957

1958,

the

dustrial

instruments,

Rorer, Inc.,
drug maker.

in

several

Mr.

to

be

important

Bullock

said.

tion.

Under

while

pates

these

circumstances,

management

your

antici¬

favorable long-term pros¬
pect for business and earnings, it
a

prudent

seems

cise

in

care

the

investments,
assets

some

not only

exer¬

diversification of

but
in

to

also

to

retain

government bonds

and cash

as

a

to take ad¬

reserve

vantage of more favorable buying
opportunities for good stocks as
they

occur.

Approximately 16.86%

company's

your

such

assets

reserves

on

repre¬

June

30,

common

stock additions to

the portfolio included New Eng¬
Electric System and Phillips
Petroleum Co. Added additions to
land

portfolio were made in Allied
Chemical; Atlantic Refining; Bendix Aviation; Central Illinois
Public

C. I. T. Financial;
Cities
Columbus &
Southern Ohio Electric; Goodrich;
Hercules Power; Kansas City
Power & Light; L.
I. Lighting;
May Department Stores; Northern
Indiana Public Service; Pure Oil;
Service;
Service;

stock

holdings were Ford
Motor; Goodyear Tire & Rubber;
and Phelps Dodge.

investment
past six

Emerson W.

Axe, President of Axe-Houghton
Stock Fund, in a letter accom¬
panying the fund's semiannual re¬
port to

fairly rapid re¬
started in early May, fol¬
lowing a contraction from the 1956
high point to the low of last April
which "in leading industries was

lesser

output

power

extent

and

automobile

engineering

contracts.

industries

moderately,
acteristic

have

a

beginning
general business upswing."
Mr.

of

Axe hails the marked

assets
to

$3.62

increased from

$6,725,212
share

a

now

Reports 14.5% Gain
In Asset Value

Mr.

half-year

the

that

Higlis

-

Counter

outstanding

as

£und
$26,788,366,

July 28, 1958 were
an increase of 45.7%
over the total assets of $18,388,957
reported on July 29, 1957.
The
net

assets

on

outstanding

28,

July 28,

1958 were

increase of 41.0%
the net assets reported on
corresponding date a year
Shares outstanding on July

$23,008,051,
over

on

1958
of

an

3,139,213,

were

54.2%
on

over

the

an

in¬

shares

July 29, 1957.

months

six

assets

net

rose

Joins First Fidelity

ment

full-year gain reported by the
from

Since

Dec.

same period net assets
31, 1957, additions
by 22%—from $130,994 to the fund's holdings included
new
investments in Eastern In¬
31, 1957 to $160,295 on
June 30, 1958.
The latter figure dustries, Inc. and Texas Natural
represents an all-time high for Gasoline Corporation. Investments
OCSF, the only mutual fund de¬ in Emhart Manufacturing Co. and

in

exclusively

over

-

Since the

the

-

to

investments

counter

securities.

founding of the Fund in

June of 1956 total assets have ad¬
vanced

by

more

asset value per

than

50%

and

share has advanced

by almost 10%.
From June 30, 1957 to June 30,
1958, a period during which the

G.

Fund

$3.63

a

Over

-

14.9%

Securities

Fund, Inc. currently has

84%

of

its assets in 36 unlisted stocks and

the balance in cash and U. S. Gov¬

Co.

were

sold.

oil

and

by

a

16%

low

Iraq

of

of

total

ll1/2%

rebellion,

Barringer

reports

resources

just before

D. Moreau
his latest

in

semi-monthly Directors' Letter.
Mr. Barringer, a partner of Del¬
aware Company, investment man¬
ager of both Delaware Fund and
Delaware Income Fund, said that
5

in the past two weeks the

lion

Delaware

$58 mil¬

Fund

substantially
added to its holdings of domestic
oils.
a

These

new

Oil

tional

investments

included

major position in Standard

of

Indiana,
shares

as

of

well

other

as

addi¬

companies

already represented in the Fund's
portfolio. The reasoning, Mr. Bar¬
ringer told directors,
vious

one

even

prices

was

the ob¬

that domestic output and

might have

raised if Middle East

to be

supplies

are

Also

reporting on recent shifts
in Delaware Income Fund's port¬

folio, Mr. Barringer said some se¬
curities, whose prices have risen
enough to render their current
account yield inadequate for that Fund's

stocks,

which

purposes,

of assets.

eliminated. These
included Gimbel,

were

liquidations

B. C.

Christopher Adds

ern

CITY,

George

has

staff

B.

of

Board

of

George

was

K.

Baum

been

C.

to

J.
the

Christopher & Co.,

Trade
&

Mo.—John
added

Building.

Mr.

formerly with George
Co.

Union.

ments

(Special to The Financial Chronicle)

KANSAS

Counter

prompted

South Porto Rico Sugar and West¬

net asset value of
by 2.8% from $3.53 to

The

&

in

are

mentation
for

share.
-

Fund,

gas stocks,
which make up 18.7% of the June
30
total net assets,
and instru¬

decline,
rose

Domestic

to

restricted.

Largest current industry hold¬
ings, of Diversified Growth Stock

market suffered its sharpest post¬
war

Searle

D.

over

Holdings
to

from

a

Dec.

voted

increase

East, has increased its oil invest¬

re¬

to

shares

1957. In the

on

10%

a

Delaware

by

semi-annual

latest

total

covered

increased

OCSF

ATLANTA,
Ga. — Robert
S.
Allen has joined the staff of First
Fidelity
Securities
Corporation,
11 Pryor St., S. W.

share reported for Dec. 31,

a

and

Oil

of June

$23,636,764, compared with
$17,824,141 at the end of 1957. This
half-year increase in total net as¬
sets was greater than any previ-

rose

man¬

previous mark established in

the

the

fund's

ous

and

sponsors

of

Hare also reported that in¬

shareholders

1957.

port,

by

Research

of the funds.

Adds

date, net asset value
was
$6.27
or
16.3%
$5.39 figure on Dec. 31,

above the

In

&

recent developments in the Middle

share

per

Securities

Delaware Fund

30, 1958.
On

ac¬

Vice-President

July, 1957.

Diversified Growth Stock Fund,
Inc. reports new highs in total net

of

record month-end

vestors' purchases totaled
$7,314,017
in
July, a record for the

Growth Fund

number

Hare,

Corporation,
agers

$3.17

The

-

Wain

National

total

Fund Total & Net

of the

E.

Diversified

and shares

a

high of $348,527,466 on July 31
cording to figures released

month

assets,

21.1%

compared with a
for the Dow-Jones

Combined net assets of the Na¬

period.

At Record

Common

gained

as

funds reached

$6,281,-

the

Group's

has

1

tional Securities Series of mutual

from $3.28 to

or

in

Fund
Jan.

re¬

per

New Records

the first six months of the year.
The
report shows
that
Axe-

159

pres¬

And Sales Set

a

ing in credit that has taken place
as the outstanding
development in
the
investment
situation
during

net

a

the

National's Assets

eas¬

Houghton
Stock
Fund
is
using leverage and that its

of

rise of $15.4%

improved

the

for

of

Industrial Average.

of

10,281 to 11,866 and
outstanding from 3,309,300
to 3,772,451. Both June 30 figures
represent new highs for the fund.

Inc.

Stock

development char¬

a

of

gain

a

Fund

$16,002,055 to
$43,260,873.

value

since

materials used in the durable

goods

Stock

commenting on the latter
sult, Mr. Ahbe noted that the
share

produc¬

Prices

$124,importantly

was

In

tion have recovered and there has
been
an
impressive increase in

raw

Common

company of

the

to

one

total of

a

results

ent value of

the January level.
production, freight traffic,

"Steel

electric

these

The

business

Boston Income

Boston,
reports that the total assets

to

anything since

brought

to

193,694. Contributing

'

midyear, he continues,

year's

from

sales and market apprecia¬

new

month period

1937-38."

By

current

the

Resulting both from the volume

Mr. Axe says a

recovery
had
back to about

of

tion, net assets of Group Securi¬
ties rose $31,986,791 in the seven

covery

than

the

conversions

another

of

shareholders.

severe

in

were

Group fund3
aggregating $586,707 for July $5,074,675 for the year to date. The
fund
provides
a ' reduced
sales
charge on these exchanges, v.

change in the
during the

says

fund. The number of shareholders

of

to

situation

months,

Securities

Fund

total

activity

important

Group, Inc.*

$1,409,$8,024,689, respectively.

and

Included

record

first

Up Sharply

958

The reversal of the unfavorable
trend in general business
an

$23,667,7

the sponsor
company, These com¬
pare with 1957 figures of

Reports Share Gain
was

month total to

seven

Sales of Distributors

Stock Fund

the

Over-Cou nter Fund

Over

Income

.

710, according to John L. Ahbe*
Vice-President
and
Director of

Inc., reported a net asset
value of $3.63 a share, a 14.5%
gain over the net asset value of

The

July sales of Group Securities,
Inc., totaled $4,186,275, bringing

-

Axe-Houghton

Sinclair Oil. Eliminated from

common

Fund,

Assets

21.1% Since Jan. 1

and William

growing ethical

a

the

the

and

appears

unpredictable international situa¬

last year.

crease

2,000 shares of U. S. Steel.
Sales include 3,000 shares of Alu¬
minium Ltd.

for

$9,625,000 compared with $8,911,000 for the comparable period of

assets 8%.

Principal portfolio transactions
for the quarter include the pur¬
chase of 12,000 additional shares
of Transcontinental Gas Pipe Line

Sales

months of 1958 increased to

pressure

H.

more

at

declining

"There

and

the

12%;
miscellaneous
industrial
17%; and cash and other current




new

business

commenced

ago

seven

ago.

production

and

The

compares

in

Fund

000

oils

gas

high

total

shares to the investing
increased 48% over the
month
before. July sales totaled
$1,693,000 compared with $1,142,-

the

natural

highest

$153,886,575 of assets at the June
30,
1958
quarter-end.
Chemical

50% of total net assets; natural gas
transmission and distribution 13%;
and

the

20-year history.

time

many

averages

also include the year-end distribu¬

tion

$166,834,285,

cal

share and at the close of 1957

per

pro¬

public

ket value on June 30, 1958 were
$27,822,665, equivalent to $5.61 per
share on 4,956,528 shares of com¬
mon stock outstanding.
The asset

value

Chemical Fund, Inc. announced
its
net
assets
had
reached

reported that July sales of Chemi¬

company,

reports that its net assets at

1957, but have

the

that

At

Public

closed-end

Record

assets.

Reports

in

to

increase in the net asset

per

New

years

Net Asset Gain
General

an

year

1958."

Assets Hit Ail-Time

Fund

General Public

Service

than

duced

of

were

follows:

as

First seven

date

the

for

.

tinued the trend shown by

earlier
Including the

;

dividends

larger

7,993,000

—

July

payment

The company's investments
not only enabled it to
pay

sented

were:

1958

31, 1957,
President of the

are,'however, areas where
industry, as well as a growing
further earnings and profits ad¬
awareness of the benefits and con¬
justments appear likely. In addi¬
venience of participating in this
tion, there are now the uncer¬
growth as part owners of a diver¬
tainties arising from a tense and
sified

age

July 1957, according to A. J. Wilkins, Vice-President.
The com¬
July

a

indication that a growing
of large and small inves¬

number

sionals.

increase of

compared

in

30, 1958

Dec.

on

have

invest¬

their clients

mutual

or

Group's Common
Stock Fund Shs.
Up

foremost

104th consecutive quarterly

six months

Fox-Martin, July sales were the
largest in the history of

June

accompanying

value

second

Dividend

world's

automatic

of

liquid level controls, Foxboro
largest manufacturer of in¬

Co.,

Bullock,
fund, told shareholders in

report

a

additional shares. According to Mr.

Street president stated. "This is

Wellington Fund sales for the
July 1958, in the amount
of $12,225,000, were the highest
for any month in the history of
the $730 million mutual fund.

Hugh
mutual

plowed back by shareholders into

the Broad

and

$229,768,663,

on

$2.40 per share

in

June, if allowance is made for the

of

the

compared with $199,479,202, or

as

dividend.

of

assets
were

share

per

of its

sales

aged

month of

$2.72

July
were

group

Monthly Record

net

poration and Whitehall Fund, Inc.

tions through

Set All-Time

Total

Shares, Inc.

Co.,

producer

Net Assets Gain

mutual

funds totaled

register

ernments.
Recent portfolio addi¬
tions have included Fisher Gover¬

45

&

was

Sons

Among
a

the

replace¬

block of James Lees

common.

The company's

$2 dividend, Mr. Barringer noted,
gives the stock a 7% yield, and is
buttressed by a good cash position
and earnings averaging $4 a share

Continued

on

page

46

The Commercial and Financial Chronicle

46

...

Thursday, August 14, 1953

.

(642)

latest week

week

Business Activity
Latest

AMERICAN PETROLEUM INSTITUTE:
Crude oil and condensate output—daily

U.

Public
State

DEPARTMENT STORE SALES

Electric

Finished

66,487,000

64,772,000

49,140,000

INDEX—FEDERAL
==

$388,032,000

212,555,000

165,460,000
222,572,000
169,785,000
52,787,000

$558,996,000
100,845,000
458,151,000

$298,259,000
147,396,000
150,863,000

New

260.924.000

127,719,000

Additions

197,227,000

23,144,000

301,405,000
242,168,000

59,237,000

fn
.

2

7,775,000
428,000

114

Aug.

INDUSTRIAL)

AND

—

DUN &

290

iug-

Export refinery at
Louis)

(St.

5.967c

5.967C

—

————~—•
—

$36.50

11.000c

11.000c

10.800c

10.000c

10.000c
24.000c

94.250c

95.375c

Hospital

-Aug. 12

93.46

86.71

Highways

96.23

90.77

Sewer and water systems

100.32

101.80

98.09

99.04

94.41

95.92

87 86

88 67

90.91

91.91

89.69

93.97

9o.(7

9 i.o2

'ji.

97.31

Aug. 12
Aug. 12

Public

—

Industrials Group
MOODY'S

98.41

99.36

::/ 91.77

91.05

Average corporate

""""Aug

—i—Aug!

a* JT~zz
Railroad
Public

Group
Group

•

Public

NATIONAL PAPERBOARD

service

(tons)

3.64

3.87

3.81

4.21

4.51
4.28

CORPORATIONS—U.

S.

CONSUMER
Month

4.02

All

f.

Short

sales

4

3.79
396.6

266,943

229,248

Other

289,506

193,815

of

V

v..

93

93

427,875

/

61

465,523

391,454

506,493

109.81

104.95

479,370

392,720

375,540

1,773,920

1,248,510

1,367,950

1,641,230

1,743,490

July 19

408,420

326,380

409,710

44.800

42,650

334.610

332,100

374,750

470,228

573,030

I

Total

626,610
154,420

157,760

129,990

purchases-

609,199

667,046

831,461

797,036

Other

3,213,720

2,387,998

'

595,280

548,180

1,993,277

3,529,301

2,787,599

2,367,096
2,915,276

July 19

2,372,487

Utilities
Banks

EXCHANGE

—

SECURITIES

EXCHANGE

Odd-lot sales by dealers (customers'

....

Number

Dollar

of

ON

N.

Y.

STOCK

—July 19

short

other sales

Dollar

•

1,203,989

$57,387,366

$55,272,322

1,366,950
15,196

1,132,737

1,177,664

13,154

1,351.794

1,119,583

1,107,154

$49,493,774

$51,551,872

$58",9tJ0,325

492,770

362,100

396,590

286,930

COMMISSION—

-July 19

YIELD

STOCKS—Month

7

of

Tel.

Amer.

eommodltU*
Farm products

—

U. S. DEPT.

492,770

862~100

of

STOCK

&.Tel.), (24i

413,290

437,260

net
to

.

of

S.__:

on
on

744,580

442,030

June

12,344,570

13,516,790

11,425,920

Service

16.334,950

13,158,480

14,261,370

11,867,950

Government

Other

OF

"
,

industries

•

t

119.3

119.4

119.X

Proprietors
Total

118.1
'

93.1

94.8

95.7

112.7

113.0

-Aug.

112.1

114.5

115.9

98.7

All commodities other than farm and foods.

.Aug.

126.L

126.0

125.D

;*

125.6

,

•

one-half
cent pound.

a

120.310

2.273.994''

.

.

/

transfer

i

Total

ZINC

payments.—1

(BUREAU

*240.1
*103.4

-

' - 33.6

*41.5

/

-8.9

/

-

56.6

>-

1

•

-Z- ?26.4.

-

6.7-•
334.4

*9.0

•

-

-

,

*31.6,
*2 i

3

-'

*6.7

-

:

.8/^ -

6.6,/

.

•330.6

*332.4

.

>

*54.9-

.

*31.7

26.6

'
■'

-

/ *56.5

.

3T.8
>

•

.

*40.2
■"

'-*8.9

.

-*32.6

,

<

*63.9

■

-

*33.4

42.3

/

•'

'
—

figure.

*62.6

•

■

^
:

rA ■

.

tons)_i

(short tons):
Stocks at end of month (short tons)./—
'Revised

*$350.8,,-

*

•

MINES)—Month

OF
.

(short

"

*233. L

special in-

for

income.——

May:

Production

Shipments

*$349.9

.

*95.6

63.Q

and dividends/—'

contribution

*,
<

96.4

1-'
1——_*

income

nonagricultural

OXIDE

235.3
"

rental income.^—

and

interest

•

!/>

-

$351.8.'
1
-

income—X—_——_—__—

employees'

Less

of

Monthly Iovestme"*

98,482.499

541,930

1,972,785

-•

106.8

d Includes 1,018,000 barrels of foreign crude runs.
§Based on new annual capacity of 140,742.570, tons
against Jan. 1, 1957 basis of 133,459,150 tons.
tNumber of orders not reported since introduction of
I
Tan,
iPrime Western Zinc sold, on delivered basis at centers where freight from East St. Louis exceeds

as

116,026,980

956,950

——'—'—.*

-

1, 1958,

321,144
.820.376

,

STATES

...

/

labor

Persortal

-Aug.

■

(

227.927.859-

218.773,150

2,122,015

■

-

!.

COMMERCE)—Month,

OF

(in billions):..

15,398,340

93.8

Re vised figure,

979,013

»

.

118.287,158

v

:

311,919-

-1,047.470

U. S. Govt, issues.
other collateral—^

;

f

31.244

224,903.638

bonds___J_r_l

■■

141,032

323,700

»

...

-

j

$2,917,878

239,760

balances

>

$2,997,689

"

'

813,910

■

r

^

credit

free

listed

borrowings

(DEPARTMENT
of

>

4.01"
•;

-

'

debit balanced—'

customers

petsonal. income-—
Wage and salary receipts, total—
Commodity
producing^ industries—
^ Distributing . industries

j
,

"3:05

*'T

.

-.

100):

foods

.4.68/

4.15

$3,163,445-

listed shares—

Member borrowings

r

936,610

4.88

,

4.53
2.99

/

-

Total

112.0

*

6.10

4.33

2.94/

and'in banks in U*.

customers'

Market, value

542,260

389,510

.Aug.

of J&n.

3.75

5.91

'4.54

___:

EXCHANGE—

of

Member

1

-

3.98

5.44

2.97

Market value

28~b\930

3~96~590.

Meats

as

;
3.79

4.31

„

Cash on hand

'

-Aug.

Processed

76.6

63.1

July:,

.

___:

,

*

OF.

;

July 19

NEW SERIES

All

;■?

of

1

extenried

*

t

-124.6

12T.2

'

I

,

incl.

July 19

=

-127.2

:

124.2
111.8

-

middle

PERSONAL INCOME IN THE UNITED

r

PRICES,

128.5

116.6

63.4

AVERAGE

,

customers'

Total

•

by dealers—

July 19

LABOR — (1947-49
Commodity Group—

137.9

1_

'

,

/ 143.7

116.7

'

Short sales.

WHOLESALE

125.4

100)

Credit

1,190,491

$63,089,444

-July 19

Other sales
Total sajgftr

128.0

'

TOTAL ROUND-LOT STOCK SALE8 ON THE N. Y. STOCK
BXCHANGE AND ROUND-LOT STOCK TRANSACTIONS
FOR ACCOUNT OF MEMBERS (SHARES):
Total round-lot sales—
.

128.0

-

___,

Employment.at

Total,

5 2"4

v

176.8 /

■

—July 19

of shares

135:3

,,

186.1

Member

1,195,715

I0.5J0

..July 19

Other sales

Round-lot purchases

91.9

-138:7

.

of June-30- (000's omitted):
■
firms
carrying margin accounts—r

As

;
•

—July 19

Round-lot sales by dealers—
Number of shares—Total sales.
Short sales

NEW YORK

1,469.140

$76,557,055

—July 19
—July 19

value

Number

1,208,686

$62,830,596

—July 19

sales

Customers'
Customers'

•

1,298,033

July 19

Odd-lot purchases by dealers (customers' sales)
Number of orders—Customers' total sales

98.5

127.8

92.1

187.7

1_

services

and

(200)

109.1

.

.

purchases)—t

shares

value

98.4
129.7

128.6

(10)

Average

COMMISSION:

-

108.9

129.8

,

(125)

(not

104.6

127.6:
106.6

.

143.9

(15)

Insurance

-

SPECIALISTS

135.3

f *;

106.7

../.

98.5

;__

•

(25)

112.3
r

130,9

_

....

108.8
..

recreation

WEIGHTED

Railroads

'135.6

104.0

138.9

Railway

Industrials

BTOCK TRANSACTIONS FOR ODD-LOT ACCOUNT OF ODDAND

,

125.5

13-7.5

131.6

care

and

COMMON

100

379,210

2,192,319

L_

i_LJ.

/

116.5

91.9

(1947-49

June

2,295,552

2,681,240

690,990

2,838,311

DEALERS

126.8
109.5
;

/

-106.7

girls'

./

goods

MOODY'S

July 19

LOT

110.0
.

/": 127 .8 "

'

131,7

,

care

of

Index
•

..July 19

sales

137.4

131.1

boys'

and

114.7

■

111.5

104.1

INTERSTATE COMMERCE

585,657

sales

Total

106.9

116.9

_1_'

116.2

-

111.8

134.3

,,

Personal

.

508,207

766,959

July 19

1

130.6

.

-

.

110.9

oil

fuel

and

'

Reading

77,450

677,041

Other sales

Short
/.

-

116.6

•

•

•

.

111.7

apparel

Medical

transactions for account of members—

round-lot

Total

,

444,550

July 19

-July 19

132.8

1)8.3

.

.

home___"-__________l__>

at

/Private

.

July 19

sales

:

'

486,402

Total

fish

electricity

and

Public

261,110

Other sales

120.2

-

Transportatiion

:

242,410

379,410

July 19

123.6

121.6

'■'/Z 120.5

-132.9-

products_/_;__i___

bakery

vegetables—l_Z_-l_Z_______'

fuels

Other

18,700

57,200

387,350

•—

$1,679,000

120.4

"

286,330

July 19

38

$302,800

123.7

Footwear

.

July 19

sales

and

Women's

1,525,720

purchases

12

Z

/

Housefurnishings
Household
operation
Apparel

1,242,660

2,253,290

transactions initiated off the floor-

89

12

137.7

283,"060

-July 19

Short

82

-

'•

poultry and
products Z

and

Gas

/

1,522,820

sales

Total

37

1947-49=^100—•

—

V.

foods

Men's

1,698.500

sales

Other

54

"127.8

r

1,591,390

2,178,690

July 19

—

(000's

;

and

Other

110.32

110.07

Other

sales

66

49

OF

DEPT.

June

95
f-

July 19

purchases

69

*

120

*

"'"

Short
Total

S.
of

July:

Cereals
Meats,

Other transactions initiated on the floor—
Total

INDEX

-

Dairy

ruly 19

sales

ug

12

282,952

4.29
427.0

July 19

sales

Total

"

548

500

167,000
PRICE

items

359,226

/"'/'

FOR

:

/;•
"

121.6

4.31

3.90

3.85

406.5

299,148

Aug.

L

Total purchases.

Month

—

Food-at home

ACCOUNT OF MEM¬
BERS, EXCEPT ODD-LOT DEALERS AND SPECIALISTS:
Transactions of specialists in stocks In which registered—
TRANSACTIONS

39
37

112

88'

:/

89

—/.

4.48

339,845

INDEX—

32 ■>,

39

enterprises
development__^_______^'

COMMERCE

Solid

ROUND-LOT

//'■■//>.

/

38

"

and

public

,

"omitted)

4.81

4.35

3.92

Aug.

OIL, PAINT AND DRUG REPORTER PRICE
1949 AVERAGE = 100

42

CASH DIVIDENDS—PI BLICI.Y REPORTED BY

4.34

4.01

4.11

t.57

4.14

Aug.
at end of period

••■»:'/ 29

•■/

/

4.08

402.3

Aug.
Aug.

of activity

Unfilled orders

other

Fruits

(tons >.

Percentage

3.73

ASSOCIATION:

(tons)

Orders received

Production

All

3.65

4.17

—Aug. 12

MOODY'S COMMODITY INDEX

254

49

Conservation

/.

4.36

4.40

Aug. 12

Group

3.07
3.99

4.65

Aug. 12
Aug. 12

;

Utilities

Industrials

i'i

3.20
4.07

3.83

12

Aug. 12

:

Baa

3.26

4.15

Aug. 12

—

44

239

■—

3.97

Government Bonds

U. S.

406

33

580

'

Water

U.

DAILY AVERAGES:

YIELD

BOND

-Au g. 12

_—

/■/i-/?

381

.120

—i

-

Group
Utilities Group

40

.

71

84 a"

90.20

21

1,365

1,281
:/-/ Z63

.

'

92.93

86.78

Railroad

90

17

39

94.86

96.54

12

Z>.

44// /
"

;

33

W 388

394

95

95.01

93.52

Aug

29
81

'

30
______

facilities

92.15

98.73

Aaa

417

255

'./Z Other nonresidential buildings

93.82

22

511

34 /',

institutional

91.46

/•;/■

'

402/__

___£

26

18

504

65

_

service

'44

159

19

——/•

and

43

■

147

1,402

Administrative

//,.-

32

/■/■•

"•

23

./■

73

65

;

■// 51

81

/

and

./

-

208

/:/•:."■ 43

,

■

153

209 /

:

30

:

buildings
_/_!

/-/'• i;///l55"

.

528

•

buildings

308

*

162

—_____________

Educational/

26.000c

95.625c

-

utilities

Industrial

10.000c

24.000c

95.750c

'

~/

:

308

165

37

-

:——:—

—

'

Nonresidential

10.500c

10.500c

10.000c

-—Aug. 12

46

construction

Military

corporate

—-

:

private

Residential

13.800c

10.500c

•

.

__

other

Public

14.000c

10.800c

:/>'/

51

Railroad

26.200c

24.700c

AVERAGES:

227

~._

824

120

70

———.—________

___.

40

.

/

■285
•'

146

.

,

204

-

169.:

buildings—

40O
.

698

315

,*

7

Public utilities

28.075c

10.500c

Aug.

MOODY'S BOND PRICES DAILY
U. 8. Government Bonds

25.925c
23.300c

11.000c

Ulg-

at

26.100c

25.275c

10.800c

*ug-

at

at
(primary pig. 99%)
Straits tin (New York) at

—1 j_

/':

•

f193 *

Telephone and telegraph

25.475c

;'

'

$53.83

26.100c

tkug-

735

1,105

/■■•". "51

'

•/

_

construction

Farm

.

$66.40

$40.83

356

52

garages—;l!_Z

1.545

1,000

—

and

3,060

rZ

1,407

1,100

/<

$4,425

•

2,773

/

1,530

Hospital and institutional
Social and recreational

All

Aug*
—- vug*
-ug-

2,974

—

Educational

5.967c

$66.49

$4,054

i4,376

378

-

and warehouses

nonresidential

91,810

•

.

'

$66.49

30,386

-;

.

'

265

275

;

____—1

restaurants,

Other public

—

Aluminum

Average

271

v.,

.

Stores,

i,_

,

___

buildings

8,377
i
_

27,757

••>/'•

4,918

1.372

3,534
„

1

|
alterations

and

V'.

:.

r.

/-•

Commercial

...

12,070,000

11,851,000

i"

dwelling units;

Other

$42.17

(East St. Louis)

Zinc

111

$66.49

——iUg*

at

(delivered)

tZinc

12,619,000

>/v

(nonfarm)

buildings

Industrial

QUOTATIONS):

Lead (New York) at——~
Lead

102

317

2,407

u;

Office buildings

6.138c

at—-—

refinery

111

'

S. DEPT. OF f

Nonhousekeeping

,

151,600

.

•'

_

construction

Residential

548,000

16.300

229,600

*

undelivered

and

construction

new

Miscellaneous

Electrolytic copperDomestic

65,000

152,800

5.568,300

21,100

:

„.

> " •;

'

Private

9,638,000

16,800

Zi/———:—

1'.;

Religious
12,707,000

PRICES:

M. J.

&

*7,855,000
458,000

1,330,000

order

on

Nonresidential

ten mmmmmwt:-

i

BUILDING CONSTRUCTION—U.
LABOR — Month of June:
Total

*

1—_

cars_____—_

'-(end of month)

$513,960,000

RESERVE

100—

lb.)
Pig iron (per gross ton)
Scrap steel (per gross ton)
(E.

cars

600,064

.

5.736.200

6,876,200

•

V

.

/•

delivered

cars

of

Backlog

■%

:

therms)

(M

freight

new

740,708

(per

METAL PRICES

for

freight

New

7,126.900

5,653,200

therms)

(M

of June:

Month

Orders

.

sales

RAILWAY CAR INSTITUTE—

AMERICAN

457,661

2

__

COMPOSITE
steel

175,994,000
31,454,000
138,230,000

456,463

aug*

(COMMERCIAL

AGE

115,557.000

183,280,000
24,454,000
106,571,000

————

AVERAGE

BRAD,STREET, INC.

25,338,000

160.501

5,822.800

—/.i

therms)

(M

gas

Mixed gas sales

607,701

•

output (in 000

FAILURES

IRON

178,808,000

66,887,000

ELECTRIC INSTITUTE:

EDISON

6,723,000

•Manufactured

135.706

*182,091

month of

therms)__

sales

gas

121,980

195,207

./.,•

"

,

sales (M

gas

'Natural

494,143

v

Pennsylvania anthracite (tons)
SYSTEM—1947-49

11,128,000

6,919,000

25,914,000
120,417,000

^g.

S.

(U.

11,760.000

May:
Total

2,045,000
11,819,000
7,561,000

178,715,000

-ug*

BUREAU OF MINES):
Bituminous coal and lignite (tons)

COAL OUTPUT

1,831,000

Ago

134.019

(short tons) end of Mar,--r-

AMERICAN GAS ASSOCIATION—For

505,622

municipal

and

of aluminum

622,204

construction—
construction

Private

1,614,000

Year

Month

-

(in short tons)—Month of March—/.

-ug.

construction

S.

7,461,000

27,282,000

MINES):

OF

of that date*

Previous

primary aluminum in the U. S.

lug.

NEWS-RECORD:
Total

6,843,465
7,919,000
27,417,000

6,423,685

7,517,000

of cars)—lug.>
ENGINEERING

CONSTRUCTION —

ENGINEERING

(BUREAU

ALUMINUM

2,062,000

1,481,000

28,464,000

-—Aug.

freight loaded

Revenue

CIVIL

80.6

7,101,000

-Aug.

AMERICAN RAILROADS:
(number of cars)
freight received from connections (no.

1

either for thf

are

are as

Month

Ago

Ago
54.9

11,754,000

;

ASSOCIATION OF
Revenue

Month

Stocks

6,535,835

of quotations,

cases

Latest

Production of

*1,586,000

in

or,

Year

1,708,000

Aug.
f'

that date,

on

production and other figures for thi

cover

Dates shown in first column

month available.

or

month ended

H,727,000

.

(bbls.) at
fuel oil (bbls.) at

Residual

6,544,735

'58.8

or

28,693,000

pipeluies~

at

(bbls.)

Distillate fuel oil
•>

§1,650,000

——Aug.
-Aug.
Aug.

bulk terminals, ^ transit, in
unfinished gasoline (bbls.) at

and

Kerosene

-Aug. 17

.

Stocks at refineries,
Finished

g'61.4

average

stills—daily average
Gasoline output (bbls.)——
Kerosene output (bbls.
—
Distillate fuel oil output (bbls.)
Residual fuel oil output (bbls.)
to

runs

Week

Aug. 17

(bbls. of
——-----——-Aug.
(bbls.)
Aug.
—-——Aug.

gallons each)_

42

Crude

Previous

Week

AMERICAN IROI-? AND STfcEL INSTITUTE:
Indicated Steel operations (per cent capacity)
Equivalent to—
Steel ingots and castings (net tons)
——~—

statistical tabulations

The following

Indications of Current

,

10,185

-

-

15,011

11,632
•13;782

13,381
27.233

»

30,429-

»

15,016

;

29,205

•

Volume 188:

Number 5768

.

.

Commercial and Financial The
Chronicle

.

(643)

First National
>

Continued from page 45

City Bank Suggests Way

^ To Ease U. S. Bond Market Problem
To avoid!, in effect, circumstances in which
government bonds
can be made salable
only if tied to cost of living indexes or

.

the

price of gold,

plan

plishes at

fell

one

what

swoop

work out slowly,

....

After

over

an

recapitulating "whatr2,re-: tive 2 investors

in

even

plishes" at

support, of ihe

"The

of

the New York First National
City.
Bank examines and

suggests

we

industry,

an

age

,f

Canadian

plan

fell

one

of

_

accom¬

vide

to

by

businessv in

increased

approach,

types.

attractive

more

politically than providing stimu¬
lus

to

has

enterprise

by tax reforms,
pursued with such en¬

been

thusiasm
to

that

confess*

was

no

the

President

July

on

balanced

that

2

of

prospect

had

there

regaining

a

"But

most

essential

financial

is

commitments

of

every type under control.
It is
not; fair to ask anyone to buy

bonds

of

as

a

government

be embarked

to

seems

a

on

which
deficits

"As President Grover Cleveland

"No

one

the

can.

big

say now

President

will

def¬

a

forecast

wisely "stated

in

his

last

annual

message'-to

Congress,
in
1896:
to perplexing extrava¬

for fiscal I960 in his budget mes¬
sage next January!. But closer at

'The- way

hand there is the problem of find¬

frugality is difficult.'

ing

buyers for $10/

is

gance,

but

easy

'

-

a

for

return

to

posed

subsidies

imistic

tion

In

addi-

cal

facing fis¬

facts."

raising new money, and
retaining at market for $22 billion
91-day bills, the Treasury will
have to refinance

With Francis I. du Pont
(Special to The Financial Chronicle)

marketable

OMAHA, Neb.—Fred J. Borgcertificates^ notes; and*
maturing in the next 12 hoff is now with Francis I. du

bonds

months.

•

-

'

""

•

-

;■* ~

Pont

"What the Federal Reserve has
done [so far} is by way of an
emergency
some

stopgap, which gains
financing govern¬
through banks of
hazardous business.
It

&

Co.,

Building.

He

Grain

The

business

back about

issue

deficits

pany has been declared, payable October J.

to

is

raises

a

the spectre

The

inflation.

As

we

can

circumstances
ment

in

bonds can

which
be

gained

now

Common Dividend No. 155

|;

A dividend of 62Vi ^

||

share on the common
stock of this Corporation
has been declared payable

The

improvement for
many of the industries and com¬
panies included in your. fund,"

says Mrs. Ruth H.'

|
||

Axe, President

of Axe Science & Electronics
Cor¬

|

to shareholders.

|j

close of business

|

report

of

shows

that

the

corporation

net

assets

of

H

this atomic age mutual fund rose
from $9.06 to $9.93 a share in the
first half of 1958; and that total
net assets increased from
$8,194,218 to $8,461,414.
,
r
<

teryention Js

that

it

gives
couragement to inflationary
chology.•-

Axe

that

says

-.-The Canadian Plan
"A sounder and

solution
young

to the

.en¬

has

and

been

more

actual

ENDED JUNE

found

by our
neighbor

north,, Canada.

wholehearted, support

of

the

banking

community, on July 14
launched a huge refunding in¬
volving about 45% of the $14
billion

Canadian national debt.
"Holders
of
$6.4
billion
3%

Victory bonds issued during World
War II and due from 1959 to 1966
offered four noncallable

curities ranging in term from
to 25 years with no investor
mitted to

exchange for

a

se¬

3 V\
per¬

maturity

'shorter than he already held. The
bonds offered in exchange (with
cash bonuses

ranging

to $19.90
per $1,000 as additional bait) are
,4f_»s due September 1983, 41//4S due
September 1972, 3%s due Sep¬
tember

1965

and

cember 1961. The

attracted

a

up

3s

due

new

in

De¬

issues have

tractive rate offered

on

ohe

that

looks

good

to

the

chines

nearly

Dominion

conserva¬

THE DAYTON POWER
DAYTON. OHIO

year

generally available to its se-.

with the

to

reach

more

$3V2

the

than offsetting

quarterly

dividend

of

twenty-five

the

close

ORDINARY

AND

TO

11 (a) Of the Securities Act of

declared, payable September 5,
shareholders of record at the

of

ment

earnings for

period July I, 1957, through
June 30, 1958, being a
of twelve months

period

PREFERENCE

interim

dividend

on

beginning

after May 21, 1957, the effec¬

tive date of the Corporation's

Registration Statement, No.
2-13305, for
of its

1,050,223 shares

Capital Stock, filed with

the Securities and Exchange
Commission under the Secur¬

year

business

August

deposit Coupon No. 234
Guaranty Trust Company of

(excluding Saturday) before

usual

half-yearly

dividend

of

ending 30tb September next will
payable on the 30th September,

also be
1958.

Coupon No. 110

must

be deposited with

the

National Provincial Bank Limited,
Savoy Court, Strand, London, W.C.2., for
examination
five
clear business days

(excluding Saturday) before

payment is

made.

DATED 13th August, 1958.
By Order

ities Act of 1933, as amended.

A. D.

McCORMICK,

Secretary.

Upon request to the Secretary

Corporation at the ad¬

dress shown below, copies will
be mailed to

of the

security holders

Corporation.

590 Madison Avenue
New York 22. N.Y.

July 31,1958

At

BUSINESS MACHINES

COSPOBATIQN

decided to pay
on September 30, 1958 Intfrim Dividend
of Six Pence for each Ten Shillings of
Ordinary Stock for the year ending Sep*
tember 30, 1958 on the issued Ordinary
Stock

the

of

Company free of United

Kingdom Income Tax.
Also decided tq pay

110

used for dividend

he

must

States and the United

under

Kingdom, to

Section 901

Internal

of

the

United
a

tax

United

Revenue

York

obtain

certificates

giving

particulars of rates of United Kipgdom
Income Ta*

decided

Also

s

di^Mtend ol 8ev«»ty>year-end extra divi¬

August 16. 1958» to- **><&-

declared payable
ol

-ecord

at

the etase

hipWPesa

August b. 196&
Cheat*, will be mailed by the Old Cqtany
Trust

Company

of Boston* Dividend1 Dm*

boning Agent

I

Frederick D. StrQXQ. Secretary

on

to

pay

oa

October 31^

half-yearly dividend of 3% (less
United Kingdom income tax) qn the 6%
Preference Stock. All transfers received
iu London on or before October 9, 1958
1958

will be in time for payment
to

CHARLESTON,

ef dividends

WEST VIRGINIA

transferees.

tax

who

Treaty

and

credit

the

he entitled by
(1) of the Double

may

the United
Kingdom* to a

Section

Internal

901

of

Revenue

the

Code

can
by application to Guaranty Trust
Company of New York obtain certifi¬

cates

United

giving

particulars

of

rates

of

Kingdom income Tax appropri¬
the above mentioned dividends.

ate to all

BRITISH-AMERICAN TOBACCO
COMPANY LIMITED

August 12, 1958

piVtPtMP NOTICE

between
United

under

States

appropriate to all the above

dividends.

and

dividends to transferees.

United

the

flv* Cegta

dend oi Fifty Cento <60*1 per share baa been

Stock- All transfers
on or More August
25, 1958 will be in time fqr payment of

States

between

DIVIDEND. NOTICE
A regular quarterly

the 5% Preference
received in Loudon

Taxation

Treaty

Boston. jK(9,fSt19Bt

balder,

the same day
of Zy2%
(less

on

half-yearly dividend
United Kingdom income tax) on issued
5% Preference Stock.
Coupon No. 234 must be used for divi¬
dend on the Ordinary Stock and Couponi
No.

COMPANY

was

Stockholders who may be entitled by
virtue of Article XHI (1) of the Double

mentioned

Treasurer.

meeting of Pirectora held August

a

12,1958 in London it

London, S.W. 1.

Code cap by
application to Guaranty Trust Company
INTERNATIONAL

IBM

GBEENBURGH,

PEPPERELL

virtue of Article XIII

New

G.

MANUFACTURING

Stockholders

of

JOHN

BRITISH-AMERICAN

Westminster House,

States

1958

quarterly dividend of.' twenty-five
(25c) cents per share, was declared,
payable September 25, 1958, to stock¬
holders of record at the dps®. of
business September, If, 1958,

TOBACCO COMPANY, LIMITED

7, Millbank,

credit

1958.

.

A

Secretary

Taxation

of the

22,

R. Y.

July 9,

A. D. Dennis,

the

ending 30th

year

on the 5% Preference Stock (less
United Kingdom* Income Tax) for the

,

61 Broadway, New York 6,

August 6, 1958

2V?%

the

of

Transfer books will not be closed.

HOLDERS

must

days

The

Secretary

WARRANTS TO BEARER.

second

the

August 1A

MIAMI COPPER COMPANY

regular quarterly dividend of one
dollar and two. cents ($1.02) per share

BRITISH-AMERICAN

DIVIDENDS

on,

September 2, 1958.

been

OF

Septembe*

August 8, 1958

4.08% PREFERRED DIVIDEND No. 17

lag in earnings

on

GEORGE SELLERS,.

payable September 30, 1958 to share¬
holders of record at the close of business

A

a

business

1958.

(25,c) per share on the common
stock of this Company has been declared

an

Company, payable

2, 1958 to stockholder* of record a*
the close of

A

billion,

regular quarterly, dividend oL 60c
share on the Common. Stock of

per

COMMON DIVIDEND No. 137

ending

payment is made.

1933, as amended, a state¬

a

MFG. CO.

4.08% Cumulative Convertible
Preferred Stock of this Company has

ness

provisions of Section

The Board of Directors hoe declared

ALUS-CHALMERS

a

New York, 32, Lombard Street, London,
E.C.3., for examination five clear busi¬

curity holders, in accordance

Secretary

1449$ Common. Dividend

on

with

Corporation has made,

McORSW

AND LIGHT COMPANY

cents

She anticipates

dividend

at¬

Government bonds since 1932 and




was

September 1958 of six pence for each
Ten Shillings of Ordinary Stock, free of
United Kingdom Income Tax will be
payable on 30th September, 1958.

Business Ma-,

broad public interest,

especially the 41/sS, the most

in

Ordinary Stock fqr the

30. 1958

C;

.

August

Vice President and Secretary
August 7, 1958

"Expenditures

expenditures."

STOCK

MONTHS

FOR THE TWELVE

•;

de¬

Holders of Bearer Stock to obtain this

entire commercial and investment

were

possibly

A
EARNINGS STATEMENT

1958.
D:

expected decline in military plane

IBM
•

quarter

30,

.

C. Allan Fee,

|
H

1959," she continues, "are

expected

OF

International

.1

enduring

imaginative

record.

missiles

NOTICE

psy¬

Facing the
problem of u. deficit, a heavy con¬
centration
of
early
maturities,
and
a
weakening bond market,
the Canadian
Government, with
the

the June total

statement

'

•

that

of

of
gold.- The unfortunate aspect of
the Federal Reserve's massive in*

Directors omitted the quarterly
the common stock for- thai

29, 1958.

The letter accompanies the sixmonth

TOBACCO COMPANY LIMITED

salable

if they are tied to cost
living indexes or the price

only

1958

q£ business

T;. NEWMAH, Secretary,

of

on

ending September

1958 to

govern¬

close

1958.

September 15, 1958, to
stockholders of record at

II

Board

dividend

per

poration, in her semi-annual letter

create

made

record: at. the

of Directors of The Colorado Fuel
Corporation
today
declared,
the
quarterly dividend of 021/2> cents per
share on the series A $50 par value
preferred
stock and 68% cents per share on the series
B $50 par value preferred stock.
These- divi¬
dends are payable September 30 to stockholders
of record at the close of
business August 18.

which

recovery

third of the

a

DIVIDEND NOTICE:

from

see

can

of-

12,

Board
Iron

and

|!

Exchange

of uncontrolled

foreign experiences, it

holders

THE COLORADO FUEL AND
IRON CORPORATION

Harris, Upham & Co.
earnings

U„ 1968,

$1.75 per share* oik. the* 1%i
Preferred stock and 11.375 cents
per share on
the 6V>% Second Preferred stock of
this Com¬

decline

time.. But

mental

August

regular

formerly with

was

Wis.,

dividend' oft

Dividend Notice

June 30,

$46.1 billion of

A

Economic Outlook

for

to-

Company

(Incorporated i,

Racine,

DIVIDEND NOTICES

on

postwar

private credit demands.

J. I. Case

,

"Yet the

<,

DIVIDEND NOTICED

stimulate

overproduction."

Axe Science Head

Mrs.

riot be"

upon

Boulevard;

b.

ernment—depend

a; prospect, of strengthening

again

to the staff of James- H. Prices &

Company, Inc., 148 East Las Ofes

September

apd

,

industry
generally improved, "unless pro¬

widely during the six months, but

$12. billion
securities to.

out¬

;

.

finance, the fiscal '59 deficit in
thg
face of improving business news, free institutions and trust in gov¬

or

Government

the

look for the metal
mining

fense expenditures fluctuated

S.

reasonably

finds

FT*. LAUDERDALE,, Fla. —
Phyllis B. Beach has been, added

a

task, in the end, canescaped. National strength
and solvency—the preservation of

U.

as

household

'<

.;

which

of life.

way

of

She

been,

and "the remainder of 1958
should
be a period of

getting
Federal Government expenditures
and

outlook

could

as

expected.

residential build¬

began this spring has
we

The Core Problem

-

budget for at least two

years.

icit

one

'

Federal

expenditures of almost all
This

the

dividend.

problems=

/'.This; sort of step is
should be considering.

the

increase
and

the

be

have

ing point to, higher earnings and,
at the least, stability of the
present

period of time. The beauty of it
is tiiaf the Bank of Canada is re¬

our

stimulus

recession

and

company's
carpet

in

what

swoop

Secretary of Treasury Robert B.
has been attempting to
work; out- slowly, over an extended

neighbors to-the lieved from
.-pressure to help the
north recently accomplished^".; .'... Government'
with
its- financing
The Monthly Bank Letter
points
out that, "the
Congress and; Ad¬
ministration, have chosen, to pro¬

position

continued

[Treasury]; AriderSon-

refunding,the August Letter

adopt what

powerful

formations

tracing Federal Reserve mitigat¬
ing efforts- "beyond the hurculean

-

accom¬

creeping inflation.

direct

tion of all production in new lowcost Southern mills, the

have been attempting to
extended period of time.
1

beset the Treasury" in-; the
government bond •!. market/
ancT

operations

With James E Price
(Special ta The Financial Chronicle)

results from uranium

satisfactory
years. While this
earnings haven't been as
good, he went on, the concentra¬

we

cently

says

mining

Mutual Funds
for the past five

Bank of New York
proposes a. remedy based upon the recent
Canadian refunding plan.
Claims Canadian
~

try and

year's

practiced abroad, First National City

as

in the television and radio
branches of the electronics indus¬

47

A

quarterly dividend of Fifty
share has been, de¬
on the Common. Stqck

Cents per

clared
of

this

Company,

payable

September 10, 1958, to slackholders of record at dose °*
husine68 on August 20, 1958.
C. EL

McHENSY

Secretary

The Commercial and Financial

Chronicle

(644)

48

BUSINESS BUZZ

Behind-tbe-Scene Interpretation!
from the Nation's

WASHINGTON. D. C.

The

problems such

major

some

—

beset with

long

industry,

coal

Capital

as

competing natural gas and fuel
oil, rising wages and transpor¬

favorable

tation costs, has some
'

things on its side.

authorities

all

Practically

that electric power pro¬

agree

expand in

for

do

to

tinue

to

according

so,

a

will con¬

degree and it

marked

to

expansion

the

in

ing

been shar¬

long time has

a

industry

coal

The

future.

the

States is

the United

in

duction

going to expand and

qualified people in the Nation's

?

Capital.

industry's trade asso¬

the

tion,

Associa¬

Coal

National

The

ciation,

next

the

for

production

bituminous

the

says

12

total 463
increase of 30

months is expected to

tons,

million

an

million tons over the
electric utilities are

growing

of coal. With the

users

electric power, coal ap¬

of

use

production
30. The
the biggest

June

ending

period

pears
crease

likely to share in the in¬
for a long time. Atomic
holds no threat of being
to coal for a

energy

Business

East Oil

Middle

real competitor

a

Pickett, executive Vice-

Tom

V-*.';- '$!

long time.

President

Study

Nuclear Energy

on

for

States

United

oil

other

believe, as well as some of
specialists in and out of
government, that there will be
less natural gas and less fuel oil
for the steam generating boilers
20 or 25 years from now. As a
matter
of
fact,
some
of the

mental

may

of coal.

use

Natural

fields

do

Congress,

depletion

•for

various

Today

more

natural

fuel.

and

are

wood

natural

was

the

was

the

is coming

oil for home
heating to electrical heating, the
cleanest heating of them all. To
help supply the electricity, coal
will

have

a

and

substantial role in

Federal

sion estimates
United
than

States

three

Power Commis¬

that by 1980 the

will

times

need

the

more

present

capacity. Most of the capacity
will havp to be supplied by the
steam generating plants


substantial degree by


Residual oil im¬

domestic

of

in

production

1954

estimated

7.6% in 1958.
Dr. C. J. Potter, President of the
Rochester and Pittsburgh Coal

to

an

of Indiana, Pa., says

Company
the

increase

import

the

is

to 13 million tons of

coal.

Coal's Advantages

Both natural

and

oil are

benefit from

to

the in¬

gas

demand

creased

fed to
coal.

a

for

energy

in

the price
of both, particularly natural gas.
has been rising. Of course it is
costing the oil and gas

industry

and more to find and keep

more

The

reserves.

oil

higher

and

becomes, it helps
economic advantage.

coal's

gas

Meanwhile,

every

one

knows

natural gas sales to indus¬

that
trial

users

have

taken

away

traditional coal markets.
How

ever,

in the long run coal

advantage

has

the

two

supplying the current.
The

apartments

heating

buildings.

ports have increased from 5.6%

natural

cycle will switch from

gas

for

board
and

industrial

many

along the Atlantic sea¬

boilers

this country. However,

followed by oil,

time probably

The

w7hen the

under

coal

heated
other

natural gas.

now

creasing imports have displaced

certain

any

coal

source,

re¬

and

products have

of the
earth.

heating in this

Then

primary

why

provides
the

than

of home

country.*

of

homes

Originally,

source

is

That

allowance

gas

fluid

produc¬

course,

minerals

oil

and

continue

of

Residual

;

black

gasoline

petroleum

equivalent

fields

gas

not

indefinitely.

tion

by

down in the gas
of Louisiana and

the years ahead

thinking of possible supple¬

be

thick

after

been refined from the crude. In¬

the coal busi¬

ness

in

fuel oil have
industry
by re-

production.

the

maining

the

power plants
field country

is

doubt that the im¬

no

the

strieting

Uas-Oil Depletion

Texas

24% of the United

residual

of

pinehed

—

Authorities in

East

crude oil imports.

There is

require¬

energy

of Western Europe's needs

ports

expanding

ments.

supplies

oil

Middle

States

Furthermore, nu¬
cannot be con¬
providing by itself a

long run solution to

oil

crude

East

90%

energy
as

crude

East

cut or should there

of Middle

and comprise

source

sidered

are

loss

a

oil.

energy.

clear

Middle

the

be

will be able to
satisfy all of the projected needs
energy

if

pipelines

consumption

will be
by 1980.
The report
to say that no single

nuclear
went

.

States

United

the

in

Man's

that coal can be depended upon

re¬

report estimating that

a

of the energy

10%

has

Washington

in

ciation
leased

Administration

Eisenhower

the

National Planning Asso¬

The

Coal

National

the

of

Association, recently advised

rivals, for

son

as

the

the

over

simple

these
rea¬

National Coal Asso¬

coal
dented its
tremendous reserves of 1.9 tril¬
lion tons of coal—enough to last

ciation

points

industry

the
even

has

nation
at

out:

"The

hardly

hundreds

of

years

expanded rates of pro¬

duction."

Bookshelf

.

.

.

Thursday, August 14, 1958