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ESTABLISHED 1S39
1®
AUG 17
business
abmmsiim
LIBRARY
Re*. U. S. Pat. Office
Volume 174
New York, N. Y.,
Number 5038
EDITORIAL
!
-
What Chance for
As We See It
.
■:4
W-:;-
Price 40 Cents
Thursday, August 16, 1951;
Among those who must form a judgment about
business outlook during the next half year,
or, for that matter, the next full year, there is no
question of more significance than the volume of
Federal defense expenditures during the current
fiscal year. Nor is there any current
question of
which the answer is slower in
putting in its ap¬
pearance.. It is now six weeks or more since the
beginning of the fiscal year, and in a degree not
By A. WILFRED MAY
>
Copy
Utilities Favored by
Investment Companies
Investment in Israel?
:
a
By HENRY ANSBACHER LONG
,
the
Observer
factors
notes
Analysis of Funds' second quarter operations also reveals
purchases of non-ferrous metal, radio, electrical equip¬
encouraging sorely-needed for¬
eign capital to enter Israel,
as special concessions, easy
profits, and the country's remarkable long-term growth
potentialities, as well as numerous deterrents, including
government intervention,
currency,
litical
bills are still
bogged down in uncertainty and controversy. And
it is not only the money bills as such that are in
this tangle.
The whole Federal program of ex¬
penditures, including those for defense, is in a
Cites
tension.
opportunities
often matched the so-called money
present over-valuation
decisive
competing
dollar in
factor
for
as
American
the
the
a
series of articles
po¬
attractive
Continuing a trend that
interruptedly in investment
strange and uncertain position. This state of af¬
fairs is, of course, in part the result of recent
vant
to
the
interests
the
of
individual and industrial foreign capital.)
part also to the fact that both political parties
in
capital with its productive results is, as we pointed out
in last week's article, the most
important element neces¬
are
ical
working with their eyes fixed
campaign due next year.
But
:
whatever
the
upon
the polit¬
the time has
cause,
sary for
capital
come,
long past, when the situation
is almost intolerable. We can not without
paying
a
heavy price remain in this indecisive mood and
Embarrassment
months,
American
investment
also
is
which
situation
also
here
The
in
to
switch in over-all
spirit,
funds
have not been
page
Bankers
to
and
investmentwise
and
Continued
23
fact
CONVENTION
COMING
page
March
the
more
food
attitude from
quarter
chemical
than
were
was
the
radio
in
The
ceded
these
issues.
doubled
Purchases of drugs and phar¬
of the previous period.
building! equipment and construction issues
little
quarter
as
from
sales
•
*•
'-
-
unpopular status of the March
approximated those during the first
32
Continued
and
ysar's Annual Convention of the National Se¬
he d at Coronado Beach, Calif., from
Sept. 30
Information at hand indicates th it a record high attendance
may be attained.
will
--
Bonds
Established 1927
Canada
across
and Aden
Zanzibar
INVESTMENT
Paid-up
Monthly Commercial Letter
SECURITIES
£2,000,000
The
Bank
Fund
£2,500,000
conducts every description of
banking and exchange business
.
Trusteeships and Executorships
also
18
State and
R. K. Johnson & Co.
£4,000,000
Reserve
page
be
.
Subscribed Capital
Capital
on
UP—This
Association, Inc.,
Branches In India, Burma, Ceylon, Kenya
Colony, Kericho, Kenya,
re¬
their
Municipal
26, Bishopsgate,
London, E. C.
,
Henry A. j Long
and
those
the Government in
Office:
as
doubled sales.
Kenya Colony and Uganda
Head
evi¬
group
equipment stocks, merchandising, natural gaa
issues.
A notable trend, not in evidence for
maceuticals
immigra-
on
the
were
time in the past, was an increased interest in New
York bank stocks. Affiliated
Fund, alone, invested $4Vfe
that Israel today represents a dynamic growth situation
whose entire population—increasing
through
buying
non-ferrous
some
constructive
the
in
electrical
and
difficul¬
is
the
favored
million
underlying
aspect
Traders
to Oct. 4.
drawbacks
The
A. Wilfred May
NSTA
of INDIA, LIMITED
gov¬
third
Also
ties.
curity
NATIONAL BANK
features; second the
relevant
policies;
the
consider
us
of
denced
the
attractive
this time on several special counts. It is now a
commonplace that defense operations are lagging
sadly. They are lagging, no doubt, in part, and in
substantial part, by reason of sheer incompetence
in administrative
circles; they can scarcely fail
on
first
ernment's
appropriated in
past years. All this is particularly unfortunate at
Continued
let
the
Favored also
Chemicals Bought
A
be
for
which
in
considered
good
additions.
purchases
Congress to make funds
generally
stocks, but profit-taking in these
issues almost equalled the portfolio
available for whatever it wishes to have done and
because of the failure of
shares
oil
business proposition rather than on
sentimental considerations. In this
of things must follow soon
course
not
group.
that
ordinary
the
the
three
these issues,
with
appeared
sufficient,
must
be
healthily based on its merits as a
the
in
during
Along
are
metal
investment of capital in. Is¬
rael,
made
j
inflationary hedge,
an
the
important,
as
a
microcosm
for
studying the current difficulty of
fostering United States' private for-4
eign investment.
'
*
"
indeed the time is
this want of realistic action.
the
additions
Israel's economic survival.
But
for
un¬
through the exercise of rights, ap¬
proximated 14% of total portfolio
TEL-AVIV, ISRAEL—A continuing inflow of foreign
lack of them) in Korea.
almost
excluding stock acquired
group,
It is traceable
events (or
persisted
terly period concentrated their buying
of utility issues.
Purchases in this
of
investor
has
company operations during
the last three years, managements in the last June
quar¬
fiscal, economic and political situation; relei
balances.
cash
investor's
Israel's
on
on
reflecting reversal of
sentiment
from* previous quarter. Building industry
commitments also lightened. Excess of over-all purchases
over sales
stepped up to 35% as half of funds decreased
liquid security markets at home, i
(Second of
stocks; with oils slightly bought
balance.- Rail and steel issues sold,
of the
convertibility difficulty, and international
and chemical
ment
upon request
64 Wall
Street, New York 5
BOSTON
Troy
Albany
Buffalo
Scranton
Williamsport
Washington, D. C.
Allentown
The Canadian Bank
THE CHASE
OF NEW YORK
Harrisburg
Providence
Wilkes-Banc
undertaken
THE NATIONAL CITY BANK
PHILADELPHIA
Bend Department
of Commerce
Head
Bond Dept.
Teletype: NY 1-708
New York
Seattle
Office:
Toronto
NATIONAL BANK
OF
THE CITY OF NEW YORK
Agency: 20 Exchange PL
Portland, Ore. San Francisco Los Angeles
Steep Rock Iron Mines
Massachusetts
Investors
Lrust
Pacific Coast &
Husky Oil & Refining
Hawaiian Securities
Direct Private Wires
Great Plains
Dome
Development Co.
Exploration (Western), Ltd.
CANADIAN
Central Vermont
BONDS & STOCKS
Public Service Co.
COSOION
»
Anmlyata
upon
reqnatt
CANADIAN DEPARTMENT
Prospectus /rem authorised dealers
or
VANCE, SANDERS & CO.
Ill Devonshire Street
z
Chicago
Los
14 Wall
Co.
Principal Commodity
Security
San Francisco
•
Angeles
&
Street, New York, N. Y.
Members of
and
BOSTON
New York
Dean Witter
Boston
Exchanges
Los Angeles
♦
Honolulu
•
Chicago
Goodbody
&
Co.
ESTABLISHED 1891
Dominion Securities
Grporamoti
MEMBERS NEW YORK STOCK EXCH.
40 Exchange Place,
115 BROADWAY
NEW YORK
New York 5, N. Y,
105 W. ADAMS ST.
'
'
CHICAGO
IRA HAUPT&CO.
Mambara Nam
and
othor
fork Stock Exchange
Principal
worth 4-eeoe
Teletype NY 1-702-3
WHitehall 4-8161
Exchangaa
Hi Broadway, N.
Bos toe
Telephone
Y. 6
Teletype NY 1-3708
i
Enterprise 1820
The Commercial and Financial Chronicle
Corporation
Polaroid
I
.
Thursday, August 16, 1951
.
Blue Ridge
they to be regarded,
are
as an
ALEXANDER
Established 1920
Broadway, New
Consolidated
Teletype NY 1-583
BArclay 7-5660
estimated at 250,000 tons of re-
fmed lead and that of refined zinc
Mining & Smelting
Ltd.
of Canada,
Company
and
producers, Consolidated Mining &
Smelting
Specialists in
fore¬
ranks
Dominion
Rights & Scrip
f
Stock Exchange
York Curb Exchange
New
Tel.
REctor
gree
timated
Va.
production
was
Conservatively esare said to
reserves
ore
for
20
than
more
years' production at the current
rate- The ore at Sullivan Mine is
I
cadmium, bismuth, antimony, silver, lead and zinc.
Lynchburg, Va.
TWX LY 77
soUjatedPrfccludeS °t iTe ^ Bluebell
Columbia
British
properties
ta
three
Graham Paige
is expected to become
one
vears
Columbia,
the largest lead
of
past
the
for
out
producers
i®0'1?6 largest lead Producers
Debentures;
'
,
,,
Adjacent to the Giant Yellow-
vastly improved situation
Memorandum on request
.
knife Mine
tory the company operates a gold
as its Con Mine.
50 Broad St., New
York 4
Telephone BOwling Green
Teletype NY 1-3018
9-5920
AUDIO DEVICES
Point
Slave
Earnings of a Well-Managed
GROWTH COMPANY
manufacturing products in great demand
MAGNETIC
RECORDING
TAPE AND
AUDIODISCS
sufficient
the
to
BE
copy
SENT YOU
of
the
ON
REQUEST
remarkable
sheet
and earnings statement
ts°tax
.
1 e, consisting of 3,276,329
shares of $5 par stock. Of these,
Canadian
Pacific
Co.
Railway
levels
such
"
count ig conservativeiy stated at
$33,000,000. This is estimated to
be approximately one-half of the
replacement value of the com-
pany's chemical plants and smelters. Current assets of $106,000,000
current liabilities of $28,-
000 000 b
inciude
Cash items
$78,000,000.
in
$i7,ooo,000
market
for the cost
of
part
of 1951, the
River in British Columbia should
be in
production. These
ore prop-
erties contain gold, silver, copper,
lead and zinc, of which lead and
zinc
predominate.
Two
and
coal
and
important
rock
rials
coke
deposits
near
operations
phos-
of
Garrison, Monmate-
necessary raw
used
in
the
company's
in
the fertilizer plants.
Consolidated's
re-
Georgia & Florida RR*
Also, Simmons Co.
dividends^ (going
paid
1946
6s
series
A
back
to
1937) of $26.50, with an average of
annually for the last five
In
contrast,
Crane Co.
paid $20.35 ($2.44 average, 19461950); Devoe & Raynolds paid
$14.40 (with $2 average for
1946-1950); Flintkote paid $19.45
($2.25 average over 1946-1950 pe¬
riod); Otis Elevator paid $18.75
($1.97 average, 1946-1950), and
Ferro
Corp.
paid $14.56
($1.20
average,
1946-1950,
plus 10%
GEIISTEN & FKENKEL
Members
Security
Y.
N.
Dealers Assn.
Hew York 7
150 Broadway
Tel. NY 1-1932
Tel. DIgby 9-1550
washington & oregon
securities
•
General America Corp.
•
Puget Sound Pwr. & Lt.
•
Wheeler Osgood
BOUGHT
SOLD
•
QUOTED
•
1950,
on an
expansion pro-
development of vast owned hydro-
foster & marshall
Member New York
for
Mu.
MEMBERS
MIDWEST STOCK EXCHANGE
postwar high.
Stix & Co.
The purpose was
could be
503 OLIVE
bought cheaper than NK by about
smelting fa- three points, for the first time in
over a decade, then Ferro was the
cilities and chemical plants, a pebuy
on
the
likelihood
that it
riod of significant
growth lies
would
again rise to its normal
ahead for Consolidated.
This
spread of around 10 points above
growth will, in our opinion, be NK.
Since then, this has hap¬
accomplished without resort to pened, with NK still at 18, Ferro
phere
as
to
STREET
new
favorable atmos-
a
taxes,
and
with
a
stable price structure for nonfer-
rous-metals.
Tele. SE 482-483
1900
when
1949,
to show that since Ferro
borrowing, in
4
Portland, Spokane, Eugene
electric power resources, and the
construction of
Stock Exchange
seattle
highs and lows each
year, except
Ferro's earnings
gram involving the development slipped
back
somewhat,
while
of important new ore bodies, the NK's
earnings
rose
to
a
new
Embarked
solidated.
smelting and
Expreso Aereo
and stock in 1948 and 1950).
cash
All this augurs well
smelting and refining operations for earnings and dividends of Conand
General Aniline & Film "A"
peaks
$56>000,000 in high grade bonds.
In
Cone Mills Common
1929, 1937, and 1946, than
as
of these.
any
years.
dated is very strong' Pr°Perty ac"
bull
all
at
$2.50
exceed
259
4-5000
higher
much
'reached
always
..
WOri.h
^
it will be found that Simmons Co.
ot excess pre *
*
Consolidated s capitalization is
history
of this company, its favorable bal¬
ance
pay
latter
tana, supply
a
'fnrm
nrof
Teletype BS
:
Telrpl")!"1
Y.
JV.
ing $1.60.
Going back all the way to 1929,
^S^OTe^S^apnlr^O^be
"ad'a"
"^excess
7-0425
CA.
Corp., at 311/4; earned $4.81; pay¬
fHo
North-
Big Bull properties on the Taku
phate
TO
the
on
the
in
properties in quantities reportedly
In
affords the Investor a Participation
in the
property
Lake
mining the flux.
INC.
anri
Mtoc
+qv
During the five - year period
Consolidated reported 1946-1950, earnings comparisons
were:
Simmons Co., $6.10 annual
net income of $41 million, equal to
west Territory is expected to de- $12.50
per
share.
Dividends in average; Crane Co., $4.44; Flint¬
velop into one of the world's ma- Canadian funds of $8.50 were paid kote, $4.96; Devoe & Raynolds,
jor lead and zinc properties. Fur- in the calendar year 1950, but in $4.27; Otis Elevator, $2; Ferro
ther development of ore bodies December of that year, an extra Corp., $3.27.
In December, 1949, I compared
and construction of transportation dividend of $4 per share was deFerro Enamel Corp., then at 14¥2,
facilities will be required at Pine
clared, payable in January of 1951.
Point before production will be Thus, with regular payments, 1951 with
Nash-Kelvinator,
at 17 ¥2.
practicable.
dividends have amounted to $10.50 The 10-year record showed that
Ferro
normally- enjoys
greater
The Fairview and Fife mines to date.
Further generous divistability of earnings-and diviproduce fluxing stone required in dend payments are probable and 1
dends
than
NK, through both
the processing of lead ores. Gold it is
reported that a stock split is good and bad periods.
Marketis secondarily produced at these under consideration,
wise, Ferro also sold at higher
Pine
Incorporated
the Northwest Tern-
in
producer known
Great
james j. leff & co.
o
St., Boston 9, Mass.
State
148
Tel.
earned $5.19, paid $2.75; and
vear
a/esMI^ubstantfaUy
.tt
.
request
on
Co.,- at 30; earned $5.83,
paid $3.00; Otis Elevator, at 36V2;
Ferro
taxes
a
extremely complex, yielding gold,, s 1 m p
;S'C„S
ments caSied
A
higher than
20%
some
zinc and silver in
1950
sufficient
be
"
4%
paid $3 dividend), is revealed
a
stand-out value, when
Flintkote
while Canadian corporate
single pro
Information
such
of
v0iume of sales,
This mine is
be the largest
2,680,000 tons.
STRADER.TAYLOR & CO., Inc.
-
are
lead
THERMO KING RT.
denly stand out clearly. Simmons
(earned $7.26 in 1950,
as
world.
U. S. THERMO CONTROL
effectiveness of Co., at 31
and
the
branch offices
j
Simmons Co.
management at Consolidated is its
ducer of
Dan River Mills
LD 39
Birmingham, Ala.
Mobile, Ala.
.
ability to achieve integration and
through research an enviable de¬
said to
Camp Manufacturing
~
A tribute to the
of British Columbia.
Commonwealth Natural Gas
nn
potential
cheap power has been
of 50%.
borhood
cated in the East Kootenay district
Industries
NY 1-1557
HAnover 2-0700
New Orleans, La. -
compared with similarly - priced
profitable utilization of stocks of well-regarded companies
also produced,
waste products.
Out of this re¬ in related fields of business. Such
among other
search
has
been developed
the companies, for example, as Crane
Alex. B. Johnson
chemicals.
company's chemical and fertilizer Co., at 351/21 earned $6.50, paid
Consolidated
business, now ranking third in $2.60, in 1950; Devoe & Raynolds,
owns the great Sullivan Mine, loimp0rtance to lead and zinc in at 25%; earned $4.83, paid $2.50;
American Furniture
An o
This supply and
of
Sul¬
ammonia
Trading Interest In
Life Insurance Co. of
LAWRENCE KLYBERT
Exchange
York 4, N. Y.
opment and
and
2-7815
Bassett Furniture
Vice-President,
Manager, Statistical Dept., Brooklyn
Branch, Josephthal & Co.
Members, New York Stock and
New
York Curb Exchanges
undeveloped potential power
phuric acid
anhydrous
BROADWAY, NEW YORK 5
25 Broad St., New
maintenance of high
Apply a sort of "theory of rela¬
profits ratios relative to sales, tivity" to stocks, and exceptional
which are currently in the neigh¬ values hidden in the mass sud¬
nium
nitrate.
York Curb
New
Direct wires to our
indirectly 5% of the
hydro-electric power capacity of
Northwest Canada, with as much
ammonium
Members
York
Vechten,
York Stock Exchange
Members
Corp. (Class
Higginson Corp., New York
City. (Page 31)
continue to be an asset
of incalculable value in the devel¬
sulphite, am¬
monium phosp h a t*e,
and
ppNNELL & CO.
Steiner, Rouse & Co.
Lee
and should
including
ammo
Van
Consolidated is said to control
reserve
t i 1 izers,
e r
Lawrence
directly or
sources.
of
—
Stock)Schuyler
Common
A
plant at Calgary,
more
as a
producer
Since 1917
120
the
in
most
also
Ltd.,
Canada,
of
Company
Klybert, Mgr. of Statistical De¬
partment
(Brooklyn 'Branch),
Joseph thai & Co. (Page 2)
Hudson Pulp & Paper
fertilizer and chemoperation is located at Trail.
company also has a chemical
-phe
prolific
lowest cost nonferrous metal
I
Bought—Sold—Quoted
Members New
165,000 tons. A major portion of
jcai
One of the world's most
New
v
the company's
York 5
"
City. (Page 2)
ing capacity of these properties is
Partner, Cyrus J. Lawrence & Sons,
New York City
^
Members of New York Stock Exchange
Corporation
Partner, Cyrus J.
& Sons, New York
Johnson,
Lawrence
offer to sell the securities discussed.)
JOHNSON
B.
Louisiana Securities
Co. of Canada,
B.
(The articles contained in this forum are not intended to be, nor
s
5l/g/52
Mining & Smelting
Ltd.—Alexander
Consolidated
Simmons
120
Alabama &
Selections
Their
participate and give their reasons for favoring a particular security.
Hanseatic
New York
and
Participants
Forum
week, a different group of experts
and advisory field from all sections of the country
in the investment
Mutual Fund, Inc.
Central Public Utility
Week's
This
Security I Like Best
A continuous forum in which, each
Thermit Corp.
&
Metal
The
in
trading markets
I
.
(594)
2
Long
regarded
as
a
quality investment, I believe this
■/l///
at 311/4. / •'•
At that time,
at
27
¥2,
so
Simmons Co.
¥2 %
versus
You
say
now
offers decidedly more
I
OVER-THE-COUNTER
100%
over
may
caused
Corp.
N. Q. B.
was
that it has since risen
for
this was
by recent special develop¬
ments,
or
whatever, in Ferro's
case; but in my opinion, Simmons
12
Ferro.
St. Louis 1,Ho.
INDUSTRIAL STOCK INDEX
12-Year Performance of
35 Industrial Stocks
.
r
*
fining
operation
at
Trail,
West
stock
holds
31
Nassau Street,
Kootenay, British Columbia, some
this time.
200
PETER MORGAN & CO.
on
N. Y. 5
van
Tel.:
DIgby 9-3430
Tele.: NY 1-2078
miles
mine,
largest
southwest
i,s
reported
nonferrous
in the world.
of the
to
metal
Sulli-
be
the
smelter
Annual lead smelt-
special
attraction
at
Consolidated is traded
the New York Curb Exchange
(current
price
144)
and
Toronto Stock Exchange
nadian funds).
on
the
(156 Ca¬
Therefore, I think
it is timely to present a similar
price
appeal.
the one made in
December, 1949, between Ferro
Corp. and Nash-Kelvinator), but
this time,
between Ferro Corp.
comparison
(to
Continued
on
page
31
'
BOOKLET
"
ON
REQUEST
M
**
'
National Quotation Bureau
Incorporated
46 Front Street
New York 4, N. Y.
Volume 174
Number 5038
.
.
The Commercial and Financial Chronicle
.
(595)
Recent Developments in
Federal Reserve Policy
By
INDEX
Articles and News
York
banker
reviews
recent
Cover
—-Roy L, Reierson-
bonds, credit restraints and other measures to check
inflationary boom. Says efficacy of credit restraints has been
overrated, since rise in interest rates following "unpegging"
served as check on credit expansion. Sees other forces
oper¬
ating to aid restrictive credit policy, and claims if such credit
policies are applied with sufficient vigor "they can crack
almost any boom," but would lead to damaging deflation and
depression. Looks for renewed resort to economic controls
The
the
few
past
evidenced
economic
outlook.
to
have
environment
A year
forces
months
and
Current Economic Conditions and the
Outlook for Stock Prices
—Nicholas Molodovsky
TV
substantial
Babson
6
WALL
rise
in
of, interest
—-Hon.'Hugh Gaitskell-!
'
unfortunate.
of
a
the
Expreso Aereo
Financing, But No Complacency
—Hon. John W. Snyder
the
Factors in
Sound
II
Flying Tiger
Self-Liquidating College Housing Projects
of
impact
and important part of
comprehensive
anti-inflation
ment is still
fore, it
ahead
look
us,
these
infla¬
tionary
pres¬
pertinent to take
seems
at
a
recent
attempt
developments and
weigh their signifi¬
to
b 1 y.
The
Bonds
prices
have
been
The spring of 1951 was
period for the Federal
Roy L. Reierson
moving down-
System. For it
a
crucial
ward for several
sions
months, the buy¬
ing enthusiasm of
has
consumers
then that deci¬
was
convinced
were
now
eager to
stocks.
The
«
tion
will
inven¬
nomic
historian
to
the
use
tem
broad
made
call
and
compre¬
1950
and
monetary
discount
credit
of
rates,
on
raised
margin
member
requirements,
of
program
securities,
bank
and
voluntary credit
spread
has
years
been
use
such
made
tion
vigorous
some
credit
policy
observers
impact
of
checking
boom.
to
credit
the
of
a
'
1,
from
securities
as
offered
banks
17
or
effectively
degree of un¬
regarding
to
the
Inventory Policies of Over-the-Counter Firm Studied
Income Taxes "Worked to Death"
"Letter"
the
future
to^support
of
a pre¬
prices
the
government
Bank
Canadian
13
Bookshelf
prices
term
marketable
bonds
could
was
not
by
below
par,
the top
the
long-
was
of
government
be
allowed
and
Securities
14
that 2 V2 %
on
page
*
From Washington Ahead of the
News—Carlisle
Mutual
News
Bargeron
Exchange
33
and
Bankers
*
Our Reporter's Report_____
2-8200
on
Governments
Prospective
Exchange PL, N. Y. 8
Security
Offerings
37
23
Railroad Securities
17
Securities Salesman's Corner
Air Products
15
Baker-Raulang
34
Security I Like Best
Tomorrow's Markets
2
Collins Radio
5
(Walter Whyte Says)
Dictograph
29
Washington and You
40
Di-Noc
*See article
by Mr. May
28
COMMERCIAL
S.
on cover page.
and
f
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Gardens, London,
land, c/o Edwards & Smith.
CHRONICLE
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Copyright 1951 by William B. Dana
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HERBERT D.
'
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PREFERRED STOCKS
-
15
Coming Events in the Investment Field
Dev. Res. Corp.
i
to
yield that should be
Continued
Associated
40
The State of Trade and
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■
Cover
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financing
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Incorporated
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scale
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exercised
some
Reeves Soundcraft
10
"
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words, the
interested in offerings of
Members New
v
Rail Freight Rise Lower Than
Requested—
World
before
•
'
12
ob¬
South,
are
-1
.*•
.
Fiscal and Monetary Policies in
Prospect—... 11'
un¬
Reierson
We
.'
Securities Now in Registration
the
School
of
Banking
of
the
Baton Rouge, La., Aug. 16, 1951.
Dr.
cost.
of general credit restraint
be
as
move
by
■.
The
having removed the impediments
address
on
<
Postwar Sanctity of Par—Gne of
the troublesome heritages of our
pegging of government bonds
♦An
Inquiry
\C\..
markets.
in
inflationary
Furthermore,
some
would interpret the
servers
?
"
re¬
these prerequisites of an effective
credit policy were largely absent
the
overrate
measures
recent
„/• \ .V' '
Business Man's
purchases in large amounts if nec¬
essary. Until last March, however,
lead
may
decade.
increase their
Federal Reserve
more
'
ability of-
by commercial
determined
recent change in the economic en¬
vironment has roughly coincided
adoption
to
government
certainty
'
the
its
movements of the prices of gov¬
ernment securities and some ques¬
These developments raise some
crucial questions. The fact that the
with
of
is difficult to achieve
them
cannot
credit
policy.
a
the
upon
Unless there is
wide¬
of
use
depend for their
powers
and
powers
taken when the prices of govern¬
ment bonds were unpegged. Not
many
the
other holders. In other
re¬
"»
New
'I
I
-
general credit restraint
to
a
straint. In March of this year, the
most significant single step was
for
in
of
reserve
sponsored
8
Business Still Holds Steady at
High Level/ Reports LaSalle
Extension University Survey...
re¬
long as the Reserve Banks must
stand ready to buy, at a generally
fixed scale of prices, any amounts
re¬
listed
on
freedom
But this
and
National Alfalfa
International Curjrency_^________^____„___
Sys¬
greater degree of flexibility
a
serves
financing
goods
building,
increased
the
as
eco¬
availability of member bank
selective
durable
use
the Federal Reserve to reduce the
re¬
Sterling's Role
credit
tools of national
effectiveness
the
imposed
controls
quirements
1951,
raised
authorities
consumer
hew
March,
were
policy. These decisions
These
con¬
trols in this period. Between Au¬
gust,
and
than it had enjoyed in
atten¬
credit
of
monetary
as
powers of
the
of
which
stored to the Federal Reserve
and
doubtless
hensive
general
measures
work off excessive
economic
future
that
of
better than cash, are
were
reached
were
fundamental to the continued
waned, bank lending has leveled
off, and businessmen, who last
year
6
Reserve
•
tories
investors
"Unpegging" of Government
Com¬
modity
Higgins, Inc.
N. Y. Curb Ticker Quotes Now
Available to "Coast
Urges Federal Indemnification of War
Damage_____
have
sures
13
World-Wide Developments in Selective
Credit Control
Analyzed by Midland Bank-of London
cance.
abated noticea
credit
program,
there
are; very • real
limitations on their use. There¬
rearma¬
of
For, although
policies are a
—Earl H. Cress____
-
necessary
eco¬
WHitehall 4-6551
9
No Deficit
rates.
most
nomic
prices
STREET, NEW YORK
Telephone:
cacy of credit measures would be
restrictive
the
7
i.
the
Today, a 1though
much
boost
we
Britain's Financial and Economic
Situation
Such overemphasis upon the effi-
economy.
—-
Obsolete Securities Dept.
6
•
-
riding high
throughout
i
Cobleigh
Swiss Trade With Iron Curtain
Countries of Minor Significance
—Max Winkler
progressively more restric¬
policy, and as having
level
Scholarships—Roger W.
us
junk!
4
99
credit
general
Not TV: That's the
Question—Ira U.
or
College
worsen.
possibly
were
Not
3
on
paved the way for a sustained and
inflationary
ago,
a
tive
significant change in
a
PRICE
CUTTING?
Recent Developments in Federal
Reserve Policy
ment
should international crisis
AND COMPANY
Cover
What Chance for Investment in
Israel?—A. Wilfred May
developments in Federal
as "unpegging" of govern¬
Reserve and Treasury policies, such
;
licrasiEin
Page
Utilities Favored by Investment
Companies
—Henry Ansbacher Long
ROY L. REIERSON*
Vice-President, Bankers Trust Company, New York
New
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•
Worcester
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Other
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(Foreign postage extra.)
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»
*4
The Commercial and Financial Chronicle
(596)
times, in the course of these de¬
clines, Dow-Jones industrials held
just above the 240 level.
The
The Outlook for Stock Prices
interpreted, in
lows
This
over
makes
20 years.
a
bullish pic¬
very
Quite possibly it should be
used
for
investment
planning.
Many competent people are confi¬
dently optimistic.
any
many
consumers' durables.
However, as they add up in this
by the The outlook for good crops for
and
foodstuffs
should writer's mind, the probabilities
"A r e
Stock cotton
favor a different chain of devel¬
an Important deepen the recessionary outlook
for
study he com¬
pared the two
important
turning
activity
and
with
1946
lines
and
candidates to them.
recession
important
areas
1937
of
these
of
some
The
in
heightened
is
of
the
economic
of
defla¬
by
nance.
of the market
does
probable that the
coming months will see sharply
rising
defense
activity
accom¬
panied by increased spending on
the
February.
cient
current
flattened
He
year.
suggested
that
look
stock
tic
•'
dras¬
a
Nicholas
Molodovsky
com¬
made in
conditions
eco¬
invalidate
conclusions based
internal
the
the market's
on
structure?.
ground
the
may be
subdivided
current
realities
and
usual,
economic
back¬
into
future
ex¬
To begin with the
realities, they
appear to be dominated by reces¬
sionary and deflationary trends.
The
the
declining trends in
most
basic
some
industries
of
are
clearly marked.
Among them are
construction, textiles
residential
Established
1856
H. Hentz & Co.
Members
■
-
*-
New
York
Stock
Exchange
New
York
Curb
Exchange
York
New
Cotton
Commodity
Chicago
New
true
and
loosening of the credit
some
restriction
some
of the effects of these
meas¬
have
already penetrated into
economy and are producing
'the
their
usual
For
instance,
field
the
However,
measures.
slow-poison action.
in the
important
residential
of
effects
of
construction,
credit
curbs
have
hardly
pectations.
•
is
It
recently
ures
Current Conditions and Outlook
As
that
inflation.
Board
Orleans
And
Exchange
Exchange,
of
Inc.
even begun to show.
It
would take time and effort to off¬
set
the various
chinery into
there
are
PITTSBURGH
SWITZERLAND
«
new
effort is expected to be
seems
to be
substantially
June
•
Homelike
•
Intimate Cocktail
•
discounted
Lounge
tjo
Purchase
With Net Worth Over $1,000,000
East of the Mississippi
Will Cooperate
With Brokers
JOHN J. TURTELTAUB & SON
INC.
Madison Ave. at 54th St.,New York 22
or
begin¬
of
rise
in
a
continued fur¬
stock
prices,
they
would be
buying secondary stocks
with large capital gain possibili¬
ties instead of taking refuge in
overworked highest quality equi¬
ties.
Latest Developments in the
Technical
Condition
of
the
Market
In
the
intervening
two weeks
publication of that ar¬
the
ticle,
real change has occurred
no
the
technical
The
market.
trials did
rise
Index
(or
the
of
condition
Dow-Jones
to
the
indus¬
highs.
new
Effective
Index
of
But
Demand
of
Confidence, as
this writer sometimes calls it) still
remains below even its June level,
not to mention its much higher
levels
of
last
May
March.
and
exists in
this country a It
is
thus
preserving its basic
considerably enlarged productive downward trend.
apparatus whose real possibilities
It may be also noted, in passing,
now
and limitations have not yet been
tested. Furthermore, some plausi¬
ble
estimates
forecast
-
that,
by
early spring of 1952, capital ex¬
penditures of private
industry
should first begin to taper off and
then decline rather rapidly. f De¬
that
composite
tion,
of
some
the
indexes
such
better
market
of
ac¬
for
instance, the
New York "Times" index, have
not registered as yet any new
highs.
They are rather plotting
as,
what may be described as
a
double
Broadway, New York, N. Y.
of
stocks
average,
of
a
quality
as
rating yield
much as bonds,
prevailing
the
stock
.
high
This
prices.
is
level
an
un¬
usual ratio for stock market
tops.
when
And
average stock yields
high, it is more logical to
so
are
expect
correction of the existing
a
disparity through
an upward
justment of stock prices.
It
is
questionable, however,
the
whether
relationships
bond
ad¬
yields
valid.
former
historical
between
continue
to
incidence
The
and
stock
of
remain
the
in¬
tax has altered
considerably
the
previously existing spreads
between gross and net yields. For
instance, an investor in a rela¬
come
tively modest income tax bracket
would
derive
a
substantially
equivalent net return from a 3%
corporate bond as he would from a
non-taxable municipal bond with
a
1 Vz % coupon.
For this reason,
private investors have ceased to
be
factor in the corporate
a
market.
bond
This market is controlled
institutional' investors many
are partially or fully tax
by
of which
The comparison between
exempt.
stock
lost
and
bond
most
To
cance.
the
yields
its
of
borrow
theory
of
has thus
signifi¬
former
from
term
a
of
wages
classical
economics, investors in stocks and
bonds have segregated themselves
into
"non-competing groups."
Stock
Yields
and
Price-Earnings
Ratios
It is true that periods preceding
the
turning points of rising mar¬
are high but
kets, when dividends
an
exuberant confidence lifts the
prices of stocks to peak levels, are
ustially marked by very low stock
yields.
The reverse is true of
top formation. This writer's own
daily index of 50 Value Stocks, periods when ebbing confidence
which is far less heavily weighted places a low valuation on divi¬
dends.
be retreating, finding themselves
Certain conclusions can
by the rails than the New York
be drawn from observations such
under an increasing pressure of "Times"
index, and which in¬
as those made in the well-known
accelerating cyclical regression.
cludes, in addition, a certain num¬
Cowles
Commission
monograph,
ber of utilities, has also failed to
The Coming Peak of Economic
"Common Stock Indexes":
exceed its May highs.
Its best
Activity
"An
examination
of
of
support
the
economy,
while
most of the civilian activities will
the
close this month was on Monday,
This writer believes that
next
spring
the
some
combined
which remained below
several of its previous best 1951
Aug.
6,
Stock
monthly
for
index
All
yield
expectations shows that four times
civilian and military economy will
in the last 68 years the expected
reach
yield
has
These
were
a
should contribute to this
squeeze,
result.
Under the
circumstances,
what is likely to happen to stock
prices?
cycles
bring out that, with few
exceptions, stock prices reach
cyclical peaks before similar turn¬
ing points
These various technical facts
mentioned
record
date the
the
stock
prices
tremely pronounced.
casion, it has been
months.
a
year
On
as
is
one
long
ex¬
oc¬
as
22
A lead of nine months to
is
a
frequent development.
here
for
and
the. lead
of
merely for the
bringing up to
indications
article
important
of
are
Aug.
furnished
whether
in
It is less
2.
not
or
new
highs will be made by any par¬
ticular
index
improvement
than
whether
an
is occurring in the
condition
of
the market.
that the internal condition of the
SHALL OFFICE
FOR RENT
size
11
ft.
x
15
market continues to be dominated
by a wide discrepancy of demand
for leading and secondary stocks.
By
this
a
good Wall Street
address—rent
month
to
—Phone
$100.00
acceptable
WHitehall
he
this existing distortion
find its
nished, at
acceptance
will
not
alienate his right tQ question why
ft.—unfur¬
per
tenant
4-7370
in
3%.
below
February-March-
April, 1899, April, 1901, AugustSeptember, 1929, and July, 1933.
Each of these four periods was a
favorable
for'
one
the
of
sale
stocks, since in each case lower
prices developed in the next year.
There have also been three cases
where
yield
above
expectations
rose
These occurred in
8%.
below 3%, stocks are
clusive.
reached by general
economic activity.
In some cases,
are
dropped
October, 1873, October-NovemberDecember, 1917, and April-MayIn each of these
1946, as well as July 9, 1948. How¬ June-July, 1932.
ever, this type of action had also three instances stock prices aver¬
taken place on other and less aged higher in the subsequent 12
It would thus
appear
dramatic occasions.
It, therefore, months.
when average
yields are
cannot be considered as con¬ that,
should not
readjustment through an
priced too
high, and when average yields are
above 8%,
stock prices are too
low."
(Op. cit., pp. 46-47.)
The practical value of such ob¬
servations
limited.
ceeded
are
selling.
Ad¬
this
the
ex¬
only a few times. Twentyelapsed between the
second and third recurrence of the
lower
limit; and 44 and 15
years
separated
the second from the
first and the third from the second
occurrence
Even if
average
such
of the upper.
we
narrow
;
the range of
yields, the application of
yardsticks would not be fa¬
industrial
stocks
by
were
years
particular, he could point to the
wide spread between stock and
bond yields as well as to the high
common
quite
study,
and lower limits
upper
eight
however,
covered
Commission
Cowles
cilitated
yields, and low average
price-earnings ratios, at which
is,
In the course of the very
period
long
upward, rather than a downward,
movement
of
stock prices.
In
average
1501
despite
Stocks
on
Bonds
known
fense would then become the main
a
Archibald, Manager
PLoza 3-9100
There
the
at
paper
ther
the
even
The
market?
shows the ex¬
treme dispersion of stock prices
behind the impressive facade of
the averages.
It suggests that if
buyers of stocks had a real belief
in
an
improvement of economic-
is
It
bullish.
internal
the
Let the reader accept the thesis
Fabricating
Company
Atmosphere
For reservations
Theodore B.
have
Metal
Excellent Service
recessionary
the
of
looks
mentioned
other sectors of the
of Our Clients
Desires
Delicious Food
•
condition
internal
One
Spacious Rooms
•
may
sufficiently the present recession¬
ary
trends
in
industry.
Four
discerning
Central Location
suffi¬
Scientific studies of business
The recent action of the stock
market appears to be in keeping
the requirements
•
be
ment economists will actually de¬
velop in the defense sector itself.
guaranteed.
and
of the
the
difficult to
estimate to what extent, if at all,
shortages anticipated by govern¬
time
As against these current condi¬
expectations.
Its pronounced de¬
clines in February, March, May
meets
however,
closing levels recorded between
jointly produced peak. If May 3 and May 9.
tions, there exist the expectations
one assumes that
It is possible, of course, that
of a
by that time the
rapidly-rising defense econ¬
forces of the civilian boom will new highs will still be made by
omy activity and a bigger than
be distinctly fading, the net effect these
and
other
indexes.
Yet
ever foreign-aid program.
In his
latest testimony before the Senate should be declining overall activ¬ there fly some straws in the wind
suggesting that they might hold.
Foreign Relations Committee, ity.-'"
The assumption of an overall One of them is the observation
Secretary Acheson estimated that
there would be no important re¬ declining trend is equivalent to that the type of cumulative priceductions in the foreign-aid pro¬ the assumption of a continuation volume interactions, which char¬
gram until the fiscal year 1955. Of the already visibly declining acterized the market during the
The government is practically un¬ trend of corporate profits after week ending Aug. 3, last, had also
A continued shrinkage of marked the week ending, respec¬
derwriting the economy for the taxes.
next three years.
Since much of profit margins, on top of the tax tively, Feb. 2, 1946, and May 31,
t
with this outline of realities and
yiXy/m dfciel
will
stream
offset
to
trends in the
a
Recent Stock Market Action
NEW YORK 4, N. Y.
DETROIT
So far,
indications of such
drastic change of policy.
inflation
GENEVA,
reverse gear.
no
financed through deficit spending,
the continued forward march of
other Exchanges
N. Y. Cotton Exchange Bldg.
CHICAGO
already
taken by throwing the credit ma¬
this
Trade
Cotton Exchange
measures
reliably whether this double
spending
economy.
by the Federal Re¬
authorities in their efforts
combat
the tech¬
objective review of
an
nomic
reversal.
there has taken
place a considerable improvement
the stock market.
in the high-grade bond market
terms of
nical position of
Could
serve;
to
parisons contained in that article
were
a,
not
undertaken
decline.
The
yet like
as
now
As far as money is concerned,
it has become very tight as a re¬
sult
of
th e
various
measures
pricesmay
now again be
facing
The decline has
but this does
out,
action
is,
article
of
and
now
their
What
in
interrupted their long advance.
They have been declining since
be-s
that
since
ginning of the
the
the
On
question
stock
private industry for
equipment.
Unfortu¬
nately, it is not possible to esti¬
mate
since
seem
part
plant
Last winter, commodity prices
;
opments.
It
•
some
branches
add
tionary trends in prices and fi¬
the
condition
to the
possibility
of
an
being formed
prices.
We know that
the averages have acted well and
by
conditions
article
new
And
ning of this
winter.
ture.
pressures
Top?". In that
Comparative Yields
or
come
currently twice
the
The "Chronicle" of Aug. 2, page
captioned
Forming
to
year, or more.
us
not
are
markets.
gesting
the
important top
the
Uncertainties of the Estimates
Prices
months
factors
.
of activity
measure
This returns
keeping
business
these
visited for
will again enter into play,
they will become effective at a later stage, shaping the end of
the expected decline and its eventual reversal.
writer
for-several
a
if
even
high
a
mittedly,
typical for turning points of bull
top at
should
a
rising economic activity
approaching fall and of
In fact, apparently
anticipating this development, the
industrials
have
even
pierced
their previous highs of February
and
May and have entered
a
ground that they have not re¬
technical grounds, Le., that stock prices are
an
be
comparable
of
objective review of economic conditions
invalidate the conclusion previously reached by him
contained
present,
even
stock prices could
forming
basis,
well
whether any indications exist sug¬
next
probably lacing
an
important decline. Asserts current high stock yields and low
price earnings ratios do not necessarily contradict this view.
12,
this
ing
an
inflationary
be
these
from
On
with sound logic, as duly discount¬
Referring to his recent article in the "Chronicle" captioned
"Are Stock Prices Forming an Important Top?", market ana¬
Believes that if
market
could
Members, New York Stock Exchange
does not
the
of
White, Weld & Co.
on
retain
strong support
The powerful recovery
above 70.
By NICHOLAS MOLODOVSKY
lyst contends that
very
rails seemed to find
Current Economic Conditions and
Thursday, August 16, 1951
...
much.
.
For
instance,- at
the time of the 1946 market
stock
about 3.5%.
yields
highs,
averaged
Though they had not
the aboveline of 3%, they
yet declined under
mentioned danger
were
already below the yields of
early 1937, which averaged about
.
Volume 174
Number 5038
.
.
The Commercial and Financial Chronicle
.
(597)
3.8%.
But
dividend
age
at
for
the
least
yields
25%—was
remainder
thermore.
and
rise
of
in
aver¬
expected
1946.
also
in
Fur¬
warning
as
signals.
and
yields
industrial
1940
Retail
State of Trade
Auto
and
stock
Industry
Price
above
unreliable
Index
Inclusion in
manufacturers
Business Failures
J
such
comparisons
Yet this type of
market
thinking led
analysts early
forecast
in
are.
some
1946
to
much
higher stock price
By
projecting,
through
correlation with optimistic esti¬
but
was
year ago.
earnings
erage
production,
for
the
30
av¬
stocks
in the Dow-Jones industrial
aver¬
age at $15 a'share—dividends
ing calculated
earnings—they
level of 250
basis of
dictions
yield.
also
are
of 330 on the
excess
3%
a
predicting a
tjje basis of a 4%
were
on
yield, and in
of
Similar pre¬
being frequently
voiced currently.
Indirectly
price-earnings
ratios, or stock yields, in reality
try to measure financial senti¬
ment.
the
market's
dollar of dividends
a
earnings is
or
as
Frequently,
valuation of
far cry from pres¬
Dividends may be ris¬
ent worth.
a
ing and interest rates falling, yet
stock prices may be declining if
confidence is waning.
When con¬
fidence begins to revive, the pub¬
lic places an
increasingly higher
value
on
earnings,
dollar of dividends
a
or
which gradually brings
down the yields on stocks.
An in¬
dex of demand or confidence, such
as that described in the previously
mentioned article of Aug. 2, should
be of greater
practical
before they
nonsense.
his report,
that his
lot of
a
ar¬
sense—or
Regardless, however, of
the abundance
lack of their ap¬
or
proval, they must be wondering
why the writer has been shying
in his discussion, from the
away,
vital issue of inflation.
The
reason
for his silence resides in his belief
that the
to this question is
answer
concealed
in
6.8%
claims for unemploy¬
ended July 21.
new
in the week
101.1% of capacity from 101.5%
A modest decline
while
loadings of
somewhat.
to
in
noted
have
unknowns:
two
the
effect
on
Sept.
Friday night, last.
12.
Rate boosts
submitting the
described the
report,
current
situation
flation.
Whether this is
fore
storm,
a
or
as
lull
a
I
we
lull be¬
lull which will
a
gradually subside into
calm,
a
in¬
in
complete
a
do not know.
Economic possibilities range all
the
between
way
war
boom
preparedness
fashioned
a
and
peacetime
or war-
old-
a
depression.
They even include — at least in
theory—a true world-wide settle¬
ment
and
a
construction
of
status
prosperous
era.
world
re¬
Under conditions
quo," the mid-year
re¬
port of the President's Council of
Economic
defense
Advisers
forecasts
spending will
not
reach
its peak annual rate until the
ond quarter of
ther
or
1952.
that
flation equation
are
March.
extent
of the potential influence
inflationary pressures on the
process
of stock price information.
Inflation
is.
therefore,
to become effective in
more
.Extension of the
metals
as
as
future
reversal, rather than the
inception, of the expected decline.
is that
authorized
Hogle Branch
Controlled
Materials Plan beginning
classes of
consumers
of
such
influence
for
the
longer term in the
ments
in
thinking in Washington is that controls may last two
this trade publication declares.
This is hard for in¬
dustry to appreciate, in view of the huge expansion of basic pro¬
ductive capacity already well underway.
Washington officials do
point out that controls may be lifted product by product instead
mill
schedules
for
the
;
•
,
.
r
quarter,
*
<
*
The extent of these is uncertain, this magaizihe points out,
adding that the view prevailing is that the new consumer goods
CMP ticket holders will be restricted to supplies within the limits
of the tonnage currently available to them in the so-called "free"
pool.
The general view now held is that it will be first quarter
before
even
semblance of
a
balance
will be
with requests for fourthquarter tonnage which cannot possibly be satisfied, and, the paper
are being turned back to consumers left and right.
up
now
over the
stand, concludes "Steel," the steelmakers are
on all major products.
remainder of the year
The substantial decline in
occasioned by the
open
in what, up to now, has been
last week's
automotive
week-long shutdown of Chevrolet
output
car
was
and truck
assembly plants east of the Mississippi River, "Ward's Automotive
Buick-Oldsmobile-Pontiac East Coast plants also
Reports," stated.
closed
were
plants
were
the agency
last
week
and
General
Motors'
scheduled to be shut down for
California
a
week
on
current week will be
fice
the
Exchange,
in
Idaho
Idaho
a
Falls.
Falls
Addition
office
total number of J. A.
announce
branch
new
raised
'
P
steel
ingots
101.1%,
a
and
castings
2,021,000 tons
or
month ago.
A
for
the
entire
industry,
compared
it stood at 100.1% of the old capacity and
amounted to 1,930,600 tons.
Electric Output Approaches
Set
and
High Level for 1951
February 3
on
The amount of electric energy distributed
by the electric light
power industry for the week ended Aug. 11, 1951, was esti¬
at 7,069,890,000 kwh.,. according to the Edison Electric
mated
Institute.
Output in the latest reporting week came close to the record
level of 7,099,385,000 kwh, on Feb. 3 for the current year.
The current total was 66,681;000 kwh. above that of the pre¬
ceding week, 816,749,000 kwh., or 13.1% above the total output
for the week ended Aug. 12, 1950, and 1,539,800,000 kwh. in
excess;
of the output reported for the corresponding
period two years ago.i
Carloadings Decline for Week and Year
Loading of
totaled 813,366
revenue
freight for the week ended Aug. 4, 1951,;
to the Association of American
according
cars,
Continued
on
page
On Tuesday of this
week it was reported that the work stop¬
at - the Detroit plant of the Hudson Motor Car Co., which
idled 10,000 CIO United Auto Workers for 46 days, ended with an
agreement for a study of disputed assembly line operations. Full
production is scheduled to be resumed next Monday.
We
are
pleased to announce
THE
r
On Wednesday of last week, passenger car producers reached
the halfway point in third quarter operations under NPA restric¬
ESTABLISHMENT OF
tions, "Ward's" reported. The three months' industry quota is
1,200,000 cars, but in the six weeks of production thus far, only
506,748 have been completed, this trade authority revealed.
The big three are
few
thousand
AN
building at rates assuming each of them a
schedule when the halfway point is
as a group are lagging, it added.
units ahead of
r
income
in
June
climbed
to
a
record
annual rate
r
Z
J
of
$251 billion, according to United States Department of Commerce.
vate
$500 million each
on
John
industry and the government.
Floods and hot weather
wheat harvest
ment of
998
last
million
month
tion
the prospective
bushels, the United States Depart¬
was
one
the
H.
'
•
'V;
r*
■
'
Webb/ Manager
Goode, Manager Municipal Bond Dept.
'
^
a
BUILDING
V
' ~l
fV
•
MAIN
'l
£
V
,
0251
'J.. '
.
decrease of 72,000,000 bushels from its July 1 fore¬
time since 1943 that the wheat crop dipped
first
billion bushels.
CriitteiMleii
of
Twenty-fourth Consecutive Week
in
■
1951
Steel Mills Extend Record Output for
of
'
FIRST NATIONAL BANK
cut
of¬
the
~
Agriculture reported.
cast, and
below
to
IN
Alfred R. Seebass, Special Representative
annual basis in payrolls of pri¬
an
'
John T.
This compared with a yearly pace of $217 billion in June, 1950. The
June rate was about $1 billion above that of May, due to increases
of about
OFFICE
DENVER, COLORADO
passed, but the independents
Personal
to
week ago, and 101.9%, or 2,037,000 tons
a
year ago
page
Hogle & Co.
offices to 15.
week
/ This week's operating rate is equivalent to 2,029,000 tons of
to meet all needs.
Stock
opening of
this
93% of the steel-
the twenty-fourth wherein produc¬
tion exceeded 2,000,000 Ions.
>
Monday,
plants of Buick, Oldsmobile and Pontiac in Mich¬
igan, however, returned to production after being idled the pre¬
ceding week and Packard resumed output after a two-week halt
because of parts shortages.
York
the
Institute announced
assembly
added.
main
The
Steel
and
,
The
Allocation
possible.
notes, requests
As matters
Iron
making capacity for the entire industry will1 be 101.5% of capacity
for the week beginning Aug. 13,
1951, or an increase of 0.4 of a
point from a week ago.
authorities right now are being flooded
booked
"
.
American
that the operating rate of steel companies having
this trade
- :
,
once.
The
direction of
fourth
years,
of all at
that the broadening of CMP to include the
goods industries will necessitate some adjust¬
A>
or
by recurring rumors of super priorities for
(Washington denies them). Mills can always ac¬
some directed
tonnage.. But if directives become too
too large they will throw production schedules out
Present
more
are
steel
notes.,
paper
production in
of kilter.
supply-demand balance.
durable
/
intensified
commodate
steel,
constructive
'
-
materials
frequent
copper and aluminum, announced last week, comes
reports "Steel," the weekly magazine of metal
But import of the action is not immediately apparent.
In some trade circles the move is
seen, as at least adding tempo¬
rarily to the existing confusion attending CMP distribution of
steel. On the other hand, some authorities feel it will contribute
a
are
CMP
in the
It would compare with wheat produc¬
1,026 million bushels in 1950. However, the department,
said, the indicated crop, plus reserves, would be more than ample
IDAHO
in this high-priced steel. All
regular mill tonnage at regular
■
fears
critical
FALLS, Idaho — J. A.
Hogle & Co., members of the New
'
be
mills, "The Iron Age" continues,
they have their rolling schedules set up they might
by issuance of too many overriding directives. These
once
be disrupted
surprise,
no
This
New J. A.
allotment
Tentative directives for the fourth quarter have been worked
working.
apt
shaping the
his
allotments to
and producers have been asked to estimate their
the first quarter of 1952.
One thing worrying the
Roads in the South and West will increase their rates by
a 2% interim boost.
fourth quarter to include all
come
of
receive
Thirty-two steel companies representing 94% of industry
capacity have received their production directives for September.
6%, including
likely to be¬
more clearly
defined, thus
clarifying also, at that time, the
to
market prices.
by the Interstate
Commerce Commission on Wednesday of the previous week be¬
cause of greater
operating costs. Eastern railroads will mark up
their rates by 9%, including a 4%
temporary advance allowed last
sec¬
By then, ei¬
both unknowns in the in¬
want
will want their
Higher grain rates will be put into
were
regarded as the "free area."
The President's Council of Eco¬
expected
up,
to
mid-year
will
Rail freight rates on all shipments except grain and its prod¬
ucts will be raised Aug. 28, the Association of American Railroads
Relatively little capacity is still
nomic Advisers, in
is
But, states this trade magazine, ingot sources have been
up during recent weeks, and the big question now is what
happen to conversion under total CMP? Obviously no one
will
Paperboard production in the week ended Aug. 4, was about
4% below the preceding week, but new orders were up 96%, and
reported
steel for
drying
electric kilowatt output,
the previous week.
real
limits of American capacity
produce and world politics.
more
conversion arrangements expect to continue
doing this as long as
freight for the week ended July 28 rose
shortages, labor disputes and suspensions
depressing effect on automotive production
a
mean
consumer
possible.
the week before.
also
was
won't
During the past week there has been a rush by these manufac¬
turers to file fourth quarter applications for controlled materials.
Most firms who have been getting part of their steel
through
revenue
Materials
continued
Indications
saw
readers will find
guments make
declined
consumers now.
CMP
than would result from procurement battles in a
rigidly restricted
"free" market. Big companies will
likely get less, little ones more.
1950.
Steel ingot output the past week held above the 2-millionton-weekly mark.
The national ingot rate, however, eased to
consumer
Depending largely on whether
they shared the writer's conclu¬
the
insurance
of
pointing out to
closed-end
checks still held by other consumers.
to act as a sort of leveler among makers of
autos and appliances.
It should provide each firm a more equit¬
able share—of whatever steel is available for these industries—
the
use.
What of Inflation?
sions
trifle
a
unfilled orders 24%..
unconsciously,
or
yardsticks such
that in
According to latest available data,
ment
be¬
two-thirds
as
receded
past week,
moderately above that of the corresponding period a
However, military output by itself, was steady at a high
level and well above
levels.
mates of industrial
production
are
the
CMP
ored
CMP
industrial
market.
steel
durables, says this trade authority.
They'll probably get less. They are the last to be given checks
on the steel bank.
And they'll be competing with a lot of unhon-
examples show how
Total
oversubscribed
an
of
and administrators
Production
lower than at the two
were
from
that, demand will be just as strong, or stronger, but
the tangles in the Controlled Materials Plan will have
been unsnarled. At least that's the
bright hope harried executives
Trade
Food
turning points of 1937.
The
Iron Age," national metalworking weekly
During that period, it adds, they will reap the
After
many
Commodity Price Index
•
part of every year between
1932
"The
peak of frustration
'
*
Carloadings
In
some
Production
Electric Output
periods
states
the current week/
Steel
they could not possibly be
regarded
officials,
B
paradoxically,
low
were
when
substantial
a
payments—on the
>5
The fourth quarter will probably be the most critical period
the entire mobilization program for steelmakers and controls
Members New York Slock
Co.
.
Associate Member New York Curb Exchange
,
209 S. La Salle Street
Omaha
&
Exchange & Midwest Stock Exchange
..
Chicago 4, Illinois
Denver
DEarborn 2-0500
Lincoln
V'
26
„
Chronicle
The Commercial and Financial
6
..
.
Thursday, August 16, 1951
(598)
and in defiance of my 60 level, and United Paramount
lace my writing with at 20.
RCA, with its extensive manu¬
of statistics, look at the com¬
the record,
TV or Not TV:That's the Qnestion
By IRA U. COBLEIGII
t
|
petitive picture now.
.
,
"How to Make
<
'
for
time and money among television,
motion pictures.
your
homes.
three-way competi¬
Channeling the various arguments in the
tion
television
•
radios
public plenty
m
are
TV, or not TV is a question meter, 50% owned by Paramount ——
definitely on the minds of hun- Pictures, has picked up where the 96,000,000
dreds of thousands of Americans, old quarter gas meter left off. You
Television
and you get
tronics
America
in
Sets
start
the
from
tions have their
has
foward
nance
into appli-
motion by excursions
color
system
is
9
the
either
of
terms
15%
18 months
and
down
J
u
balming credit
budget
~
"
.
wavs
a
black
and
him
video orphan.
white,
against becoming a
Secondly
tion
c1
what
nicture
theater
theater
—~
hniit
television
The
what would
o
indnQtw
at home
hannen
11
to
invest-
a r
ment in playhouses7 Who will nav
for
high-cost
the
video-viewer
free?
Well
proved
nictures
feature
the
movie
them
sees
somewhat
attendanre
if
for
im-
in
overnight,
t~» *
411
t\
r
a i
the
Church and
the things it
stands for
Now I have
been thinking
v\ it
m
a
l. 1
a
j
«
..a, »
...
i'o
av ...
t
4-
n
1
rtv* n
reach vui ?caia
our > ears
4i-v
r\4'-l' 1
v\ f
C
nm
a!
total stations in the offing, and
rising national income suggest a
future ratio of at least one tele^
vision 'receiver for eSch. three
radios. ;■>>
With the above ideas dialed in
for your benefit, I think you are
now ready to answer, in your own
way, the question TV, or not TV. ■
'
_
_
_
'
_
dfat^une their
. _
■ -
In Pacific Northwest
recent attempts to pipe-line fea- price of television shows return-
A •
j 1
better quality films are the prime
TtTJnvl
fa^equate ,f}« divitdends-
assurance
of
stiles.
the
On
nicture
picture
tems,
into
"rewed
there
there
other
nn''
side
the
the
are
aie
presently
action,
indicates
three
three
being
tight onto movie screens suggest Top
turn
sys-
deployed
for box-officing
A
the
iicini*
bring feature films
to
at
n°W*
Then
,,to
$1
you
+
radio
Tryout of this in Chicago
was most
or
exclusive
an
them from their
vidpn iptharvxr
nv
ovo«
hearthside 01 Vlde0 lethaW- even
Phone
V
lines
tei nh
telephone
using
copy.
can rouse
hearthsidp
First is the Zenith idea
a
good picture,
event,
home viewer.
vision
vision,
video entertainment may
that
V
what
be
TV
about
blanketed
be
can
by
Must
the
fact
seen
both
encouraging. Then Tele- heard* I don't think
.
radio?
and
so.
Just
radio
themselves
stations
s
when
a^good suggestion
it
s-hard
to
offices
of
the
buyers
sellers
or
you
*
want.
direct from the trad-
FOrUand'
^ geatuf
Wash
The opening of Curb Exchange
ticker service in the Northwest is
^et'
a
a"tennae ever prob-
from
coast-to-coast
and
dealers
miles
.
-
further step in the program of
forlehwigon
for
the
,
case
be
can
commitments
current
around
sLres, and
help,
we're
happy
.
of
can
.
for
to
"World's
22, Zenith at the
of
Largest
do likewise."
to
Unfair
Present
During
the
Conditions
summer
I
have
ing students have not the money
to go to college. They can
the
private
wire
contact
that
literally
particular
issues
link
100
thousands
or
do
it.
So,
any
time
you
can't swing it. On the other hand,
students who are much less de-;
serving go
to college with
"Call Merrill
which send
uates" would do far better to go
announced thp exnansion
to the
move
announcea me expansion move.
ord
Gallagher, Jr.,
Morton
&
Inc.,
Co.,
and
students
With W. H. Morton
H.
high schools and select their
students by their high
15
then
help
through
school rec¬
finance these
college.
Jr.,
firm.
is
now
-
associated
with
picking four years late!
'
BONDS
CORPORATE BONDS
Defense Orders.
LOCAL STOCKS
Information
on
Request
-
Trading Department
Merrill Lynch, Pierce, Fenner & Beanb
Moreland & Co.
Midwest
Detroit
•
The Robins
on-Humphreg Compan$1nc:
Members:
-
1051
Offices in 97 Cities
.
Importance of Summer W rk
Of one thing I am certain—
namely, that how high school
STATE AND MUNICIPAL
Lynch
STREET, NEW YORK 5, N. Y.
the
EST. 1894
85% Are
Stock
Stock
Exchange
Exchange
Penobscot Builditig *
DETROIT 26, MICH.
Bay City
Muskegon
RHODES-HAVERTY BLDG.
WALNUT 0316
These
corporations are now doing their
Backlog
$6,000,000.
we
55
an
McCormick, Curb President, who
W.
Darling
Order
quotes
think
get,
Partial scholarships, but unless
they can live at home, they just
Street, New York City, announce that Francis P. Gallagher,
L. A.
.
-
bought mine and I want
^"corporations
Manufacturer
Display Equipment"
just—-
70 PINE
,
ment ofaccording to Edward T. their employment the "best to the ^
the nation's investing colleges to hire managers gradpublic,
Approximately
more,
-m*
Lndlrl eVZ thf 1!?" the members of the exchange to automobile and a big spending
.
^
have v50,000
we
ma
.
earned
...
lng floor of the exchange are now
avanable to investors in Portland
F. P.
want.
What's
can
Lynch"
time in unlisted securities—especially
..
customers
you
J. 1a
Broad
Why?
Because
you
r
Ance
been beamed the on radio, imarin investment , , . .
And finally
in radio
any
lind
ivr/-kvthnroot
ild
transmitted
now, all their big earnings have
argued
"Call Merrill
must
decide how deeply to invest in
television facilities when, up to
brightest future
A
quite decent
That
j.^.
i?
.1
the P^ouse pessimists had price itself out of the advertiser's tickers went into operation in two talked with several high school
^etter. g0 back to the,r neuroses, budget and cause extensive rever- leartin„ cities of taat area Curb principals. They tell me that some
Americans are the roving kind, sion to radio plugging. Also the
^hang? market Quotations of their highest and hardest work-
the
of
-
Lincoln, as I have two;
the money with
a
I
which I
ticker service were introduced in-
still lure oeoDle
and
i.1.
_
three times the cost of the car.
Land and labor are the basis of all
wealth, especially in this day of
inflation. Land is more desirable
than money. Land will keep geif
ting more valuable if you give
ft half the attention you would
give a car. If you take care of
y0Ur land, son, it will take care
of you. I cannot object to your
Curb Exchange stock and bond
pictures'will
to the cinema-
nence,
"Hence, ins.eaa oi giving you
ins.ead of giving yuu
the car, I am enclosing a deed to
forty acres *of good land worth
but
that
rior
suggests
/
_
having
NaY. Curb Ticker Quote
m a r q u e e s in the next 2 question posed by this article. Adyears- plctures can improve, and vertisers may find the increasing
past 60 days
grad-
you as a
nation present. ei
Mother wants me
-•
t:
i_ r*
icaui
4 v\
Roger W. Babson
ofwhattogive
plus for TV. • It will bring when our eyes are elsewhere ocreception to new millions, make cupied; while more cables, 2,000
fat
Kouseholder will, by habit, possible improved programs from
8nd for change of scene, still head the diamatic font of Hollywood,
out °* his home for a £°od m°vic. and permit Eastern vision of such
America is gregarious, and will special events as the Rose Bowl
still pack the stands for an Army r game. And if, following the failNavy game, a World Serious or a tastic success of the Kefauver
Joe Louis fight. So, though there Committee on TV, we can view
are nearly 20>000 playhouses plus the Congress in Washington, in
3'200 drive_in movies, it would be process of legislation, then a new
most unwise to follow, sheep-like, legion of set buyers may come
the Pr°Phets of do°m. who say forth.
that 4'50° movies will cobweb
Others, too, must answer the
the
TV0
and if everybody looked
the multi-billion d
▼
premiere oepiexiiuer ouin is a big icjuiu will even
September 30th is a uig radio wiu even
a0e
he
toward
the
to
money.
recently received from a
I have
(.mnnnnnn
mi__
premiere
way.
Let's look at it an<
ige
Customs don * change
mo-
Should
home
or
nutlet*
the
about
oroduction
his
ant
movie
assures
oroducer^
earn
devoted father the copy of a letter
which he wrote his son on gradnation. In it he says:
"Mother and
I are proud of
the record you
have made in
ieciPes' and breakfast clubs on current dividend basis gives you
radio- So don,i write off radl0' some Vresen* reward; and there,
along with the dinosaur and the are reasonable hopes for a new
hoop skirt. Could be Dagmar will and higher earnings horizon.
>
never replace Mary Margaret McSo in deciding TV or not TV,
£rjde or John's Other Wife!
- we are in no
position to sing
There are, however, some TV dirges for theaters or radio, even
fact0rs that are not to be sneezed though recent television7\/T^™ „ +
growth
2„l
_i.
Pe°Ple wdl come out to see it.
another
—
in
J
-
.
,/rN(;x,t
thea!.er °wrier.
Must he sit idly by, while patrons
sta^ away m droves to see the
Plctures ,on home screens, nrnthat
thpv'-v/fi
nfllH him In
(3)
by Christmas
higher
be
-
■
'
.
on
his
for
revenue
nrnrWt
inflation hints that set prices
mav
...
people is
opportunities
Another thing, at breakfast and coverage of ^
, three ^mediums,
school and
shaving, radio programs will al- It has an interest in 958 theaters college, espe' ways, outperform TV; and while (689 wholly owned); and assum-' cially by your
whi In' the Tittle woman is washing the ing
successful merger with continued
while
dighes> ironing your shiirt, making American Broadcasting, five radio faith
in God
to"latch
plans
event he
fo tan^ble
with the crinoline dating
of
his
early
American
7-inch
"knot-hole'-')
or
(2)
the lull in
return
fhpmnvip nrnrfntw
Th.ic
Thus, the movie producer,
up
our
game.:
yard
(maybe too, he's
20-inch model
a
fed
work and
"
young
sporting events, like a Yale-Har-
set.-
however,
help
them
give
to
college. Says
them through
best way to
either exclusive films, or--
grams,
into
new
Probably,
Cofoleigh
U.
Ira
built
his
presumably
the feature attraction,
he
man¬
to high schools and
select best students and help fi¬
13,093,000
13,093,0UU — lotai //i/oi k
.
.
not
buy
a minus
the "selected short sub-<
What can we glean from these ances such as ice boxes or ironers.
television set. jects"—and all without uncrossing items?
First that TV has really Earnings have been expanding,
True
the your knees or leaving your arm-j done a terrific selling job. Second, and the 492,464 shares of commonprices have chair.
TV has not scratched the surface sell today at roughly 4 times indropped
15%
Another nav-and-vou-see system1 in
the "second-set" department dicated 1951 earnings. A good line.
to
50% since js called Subscriber Vision spon-;and wide sections of U. S. A. are of sets, dynamic management, and
last
March. sored by Skiatron Electronics and- still without television. Third, and interesting Phonevision possibihbut
still
the Television Corp. Here, some sort this'is negative, the 19 millionl ties, plus rumors of a stock split.
color problem of specially keyed card is inserted auto radios fill a market that TV give your speculative imagination
is blurred, and in a slot gadget, attached to your will never even enter. You cant Plenty
tree plsy here.
he
may
hold set For a projected $2, this card-drive, watch the road, and look
United Paramount presents itoff
till
some wm provide several hours of proat TV all at the same time.
self as sort of an across-the-board'
should
or
corpora¬
employment
go
agers
and
its
up
are
advocates
Babson
Mr.
and bright prospects.
cluttered
never
*.■<,/*i
1onoonftft
and
responded well
Zenith has been expert at elec¬
1/1/51
Total
scholarships
college
assure :
activity,
trading
of
to good news
of
unfair,
Contending present conditions
The 13,881,
common
have traditionally
places.
Should he, drop in your money
of
shares
BABSON
By ROGER W.
j
of
future
the
on
ether entertainment.
in use.- 016
gives
research,
its
and
call
broad
a
>'
v
auto radios are
,19,100,000
5,000,000
radio, and
,
3Tirst, the householder.
television
and
sets, its colored video system, its
wide networks in both radio and
41,900,000 homes have radio.
30,000,000 ' extra sets are in these
Killing in Wall Street and Keep It"
a
radio
of
facture
>
-
,_
America
in
Sets
•Radio
Author of
I?
lot
a
College
Scholaiships
not to
vow
ATLANTA 1,
GEORGIA
LONG DISTANCE
421
Volume 174
students
great
Number 5038
their
use
.
.
is
summers
importance.
I
have
The Commercial and Financial Chronicle
.
of
LETTER
From
employ only those who have worked
every
earned
at
tuition
and
board
ferred.
The
best
.hire
least
half their
those
are
their entire
who
pre¬
people to
young
Home
A
have
his children
less
a
to love
employed in the yards
"steam fitters" when all
for
much
has
person
learned
work, something is wrong.
have been careless school
It may
During World War II, I had occasion to visit the Kaiser ship¬
yards in Portland, Ore., several times./One heard numerous stories
they had to do
go about a vessel in the
three
daughters,
averaged $600
the oldest
of
much
had
It
is
for
a
with
than
parent
"yes"
say
rather
part of the parent or
grandparent? Sometimes I think
that
families
lacking
fortunate
more
sessing
it.
money
than
this
home
and
are
those
Certainly
educational
walked
pos¬
The
best
the
to
they
work
stick
selves
times
whole
out
think
a
in
job
billions
If
Not
will
person
he
or
family
can't
-
do
hence
and
so."
Let
myself, would like to
•
thinks
What
About
believe
children
and
they should
the
They
making
it
should
useful
for
That
v
is
for
The
love
of
Instead
young
be
on
The
to
the
is
CIO
will
to
see
of
arranging
to
26
better
get
to
him
make
Trustees,
power
lated
up
to
however,
should
income
to
help
of
CLEVELAND,
A.
Herrick
is
Ohio
with
Chronicle)
—
In the past he
Stanford
you
of these
13.2%
in
j
Aug. 7,1951.
1
'
This advertisement is neither
an offer to sell nor a solicitation of offers to buy any of these securities.
The offering is made only by the Prospectus.
•: _
NEW
ISSUE
August 16, 1951
•
I
are
glibly
organized
The
workers
under
$35,000,000
Province of British Columbia
(CANADA)
the
Debentures
can
are
separated in the continual
A p proximal}
Offering
Amount
Rate
Yield To
Price
Maturity
Maturity
3.20%
98.65%
3.25%
prices rather than bring them
$26,000,000
3K%
August 15, 1976
97.55%
3.65%
politician
named
to boost
Mike
DiSalle
whose
to
seems
that
me
it
is
important to keep in mind during
agitation that "inflation"
political term. It was not
a
is
It
noteworthy
is
the
most
time
that in the
sought after
current
agitation the
in the world.
currency
one
would
t
,
Copies of the Prospectus
have
thought such saving
would
may
be obtained from
only in States in which such underwriters
as
you
V
-
r?
very
in
our
and
3.10%
Plus accrued interest from August 15, 1951
as
securities
and
in
which
the
any
are
Prospectus
of the several underwriters
qualified to act
may
legally be
as
dealers
(
)
distributed.
have
But out of
faceci
an
man.
even
greater
menace
than Hitler and the Nazi hordes
the
Great
him,
we
Man, and
would
did
escape
what
he
But if
said
we
to
followed along
do,
particularly
this disaster.
Truman, pursuing the fe.'.r philosophy, kept
up the
in, along with the scare about the
the "prevention of inflation," kicked
the teeth in the Congressional campaigns of 1946 and he
City.
scare
after he
came
But controls,
"infla¬
the basic disease of government
spending and high taxes.
The First Boston
atomic
A. E. Ames & Co.
Corporation
Incorporated
him in
soured
them. He was soured on them when Korea came
along so the
Republicans, not being very original, took up the inflation" scare
and agitated for controls. Truman
finally came back to the real¬
ization, under the pressure of the CIO, that there are votes in
the buncombe of "warding off
inflation," when housewives are
sensitive to rising prices, and again took
up the "inflation" scare.
Whereupon the Republicans cooled off in their ardor for controls.
Such are the political shenanigans of the
times; none of it goes to
on
•
in 1948 and
j
New York City.
August 15, 1957
Mr.
Street, New York
Building.
6V2%
amounted
imports, comparing
%
bomb.
'
the Colcord
with
countries,
of total
3
tion"
securities business from offices in
Eastern
$1,500,000
mediocre
a
reelect
offices
John P. Crehan is engaging in the
the
MAX WINKLER
a clear
sky, as the decks were be¬
ing cleared for the 1944 Presidential campaign, we were told that
Edward Brender is engaging in
Opens
Bernard, Winkler & Co.,
11 Wall Street,
more
with
OKLAHOMA CITY, Okla.—Col.
trade. In 1949, Swiss imports from
99.08%
contented
Edward Brender Opens
Col. J. P. Crehan
to them financial assistance.
99.63%
we
at 108 East 17th
lowest in years, both in respect of
amounts
and
relation
to
total
August 15, 1955
the
with Otis
business from
appreciable effect upon
of the Western na¬
promoters of controls
and this greater menace was "inflation."
securities
no
economy
tions, especially so long as the
United States continues to extend
million. Last year's figures are the
currently used is something dug up and in¬
language by the brain trusters of Roosevelt the
Great. It was something else that only he could save us from.
He was by way of saving us from Hitler and the Nazi hordes at
& Co.
a
the
August 15, 1956
"Inflation"
Livingston,
was
have
%
troduced into
•
Williams & Co., Inc., Hanna Builds
ing.
ination of trade with the East will
exports aggregated $66 million, or
7.3% of total exports of $904.8
currently used in this country
prevalent in our vocabulary
of the hifalutin' '20s when as I recall it, most of our economists
agreed with Calvin Coolidge and Andrew Mellon that we could
go on the way we were going forever. "Inflation" then was some¬
thing such as occurred in Germany when money became utterly
Joins Livingston, Williams
Financial
fur¬
total elim¬
or even
%
worthless.
The
It is abundantly clear that
ther reductions
amounted to $50.4 million, or 4.8%
of a total of $1,048.8 million, while
training of the CIO—and I specify the CIO because
"education" actually originates—have come to
Only their "take home" pay is in their
American dollar
to
lion.
total trade
3
is
need.
(Speeial
a
$1,953.6 million, or 5.8*%. Im¬
ports from the Eastern countries
3
this
have
case
only $116.4 million of
where the
likely contribution will be
accumu¬
in
Winkler
Max
under
40 years.
to use part of the
million, or 3.3%
total imports of
$23 % billion, imports
Of
$1,500,000
It
years
$1,564.8
total.
than
$6,000,000
trustee with the bank but to move
26
Dr.
to
con¬
down.
the
the
is
co¬
may
billion,
propaganda about price controls and inflation, you will find that
controls essentially mean a bureaucracy of some
60,000 persons
in¬
age—it
of
years
than $48 V\
$832,800,000 or slightly more than
31/2%, while exports totaling $732
million represented less than 3%
of total exports of almost $25 bil¬
So-
of
bet your boots that regardless of how
"siphoned off" in taxes the CIO will see that the ex¬
aggerated level of their "take home" pay is maintained.
much
the
the
the
of
from the Soviet bloc amounted to
be insensible to taxes.
consciousness and
a
work
for
all
the
trade
more
of
bloc
amounted
to 6%
the ground that controls
that.
When the chaff and the grain
person
when
come
prevent inflation.
The
now.
that
blessing.
a
the-
viet
Total
a
benevolent
in
and be
save
as
by taxes.
supposedly free people's earnings should be "siphoned
off," not just to raise revenue for the government but primarily
to "prevent inflation" is a
commentary, in itself, on our current
thinking. But they aren't "siphoned off," they were not "siphoned
off" in World War II and
they are not going to be "siphoned
but
result
unnecessary
citizen.
to
necessary
insurance in
not
beneficiary to work,
being described
are
worse,
best editors and opinion moulders
of sickness, old-age or hard
case
housing bill
well
that
off"
1 luck.
the
way as to
the members of Congress who won't
Political catering of this sort to these organized workers is
spring of the price control movement although I know
it has many ramifications and is
supported by many of our
V
I,
Funds?
Funds
grandchildren;
as
they
explain, of course, that the surplus earnings
workers will be and should be
"siphoned off"
Trust
serve
with
tremendous agitation in Congress
just now to spend
cost housing for the workers at
defense plants.
must they receive the exaggerated
wages which
into line behind
and
one
under review amounted
more
year,
trade
Swiss
million.
totaled
its
sig¬
Last
Dargeron
a
your eyes, and
over
dollars, with the
while trade with the Eastern blo<5
nificance.
Carlisle
dition them for Communism.
me.
Trust
in
for
billion
in 1950 to
Eu¬
than
Grade A beef steaks.
or
well
countries
circles
economic
period of five years, an outright gift to
them, so the agitation
though it is wholly untrue, we consign these patriotifc
workers to intolerable
living conditions and what, is
■
I
$100
and
Western
goes,
three such students who would
or
immediately write
in
United
ropean
price controls now, as it was then,
girl should be permitted to make a
fur coats,
to
Western countries recording a socalled adverse balance of trade of
have
a
as
exports to and
the
Soviet
bloc
from
amounted
for
States
have for $1,200."
we
imports
more
that
reveals
one-half
the
trade.
her,
haught¬
coat and said
analysis of foreign trade fig¬
eight Marshall Plan coun¬
for
tries
a
help two
so
her
embarrass
Nearly
every
day you hear
speeches in
Congress
and
harangues from Leftist radio commentators that while we
permit
"big business" to write off expansion costs in tax deductions over
he
that
add
me
of
An
ures
coun¬
is
may
senseless tools of heartless
capitalistic interests.
good opportunities to work, per¬
haps the best way to help them
is to say to the high school prin¬
cipal:—"I
want
to< help
some
worthy student who is anxious to
go to college but who must help
his
1o
re¬
moral effect it
She
low
on
only
fall
people
young
so
bring tears to
cerned.
giving
helmet
as
dispatches,
whatever
Are paid but they must also be
given subsidized housing to make
their living really worthwhile and
to save them from the Com¬
munists. The plight of these
neglected workers is being depicted
in cartoon and otherwise
propagandized in such a
family help. But
idleness is dangerous to all con¬
to
or
There is
she finds without
Next
and
thinking
much for such
pay so
some¬
which
slacks
girl,
fur coat.
a
young
one—then
young
a
eyes:
week, with overtime, and the economy of the
country should be placed in a straitjacket so she won't have to
them¬
okay. I
own
girl without batting an eyelash asked
might try it on. When it fitted, she
she
hundred
job—or
tries
leading
department
store
miss, about six months off the
The political theory behind
is that this semi-literate
training
money.
be ter
a
come
better
earn
my
press
her commercial policy
the Soviet-domi¬
important
with
saw
decision,
total exports, compared with 8.8%
in 1947 and 10% in 1937.
<
respect to
nated
20
was
-modify
with
1937.
Exports from the Eastern
bloc amounted in 1949 to 8.7% of
.i
Switzerland's
to
calmly neeled off 12 $100 bills and asked:
"Could I now see
something for every day
wear, something about $400."
Worthy
the
to
find
they will
do
and
whom
Chronicle:
'
ported in Geneva
The
if
help young
people is to give them opportuni¬
ties
the
sales
to
way
.young
I
brought out a luxurious
ily: "Here is something
problem is topsy-turvy;;
Helping
a
on
selfish¬
pure
the
on
episode
Portland's
The
refuse; but isn't this
ness
This
Into
-
easier
to
to
week.
a
farm, and asked to be shown
ra.her than too lit¬
was
of construction
course
home training, or giving the
boy or girl too much money. Cer¬
tainly more high school young
people are harmed by having too
money
Editor, Commercial & Financial
as
and place a chalk mark at intervals
designated
on a blue
print. One particular father and his
or
money,
tle money.
reported decision to modify commercial
policy with East has only moral significance.
r
about the inflated wages being
paid to young boys and girls drawn
from the farms as far away as Iowa and
grandchildren. Un¬
or
young
too
Winkler holds
»
*
Important
do
can
Dr.
earned
way
Training
person
EDITOR:
Countries of Minor Significance
By CARLISLE BARGERON
work.
summer
THE
Swiss Trade With Iron Curtain
Ahead of the -News
1
college
be
to
are
through college,
with the help of
scholarships and
.
Washington
summer
during high school
college. Those who have
and
TO
about
to the conclusion that I will
come
7
(599)
Harriman
Ripley & Co.
Incorporated
Smith, Barney & Co.
1
Halsey, Stuart & Co. Inc,>*
■
,
The Dominion Securities
Corporation
Wood, Gundy & Co., Inc
McLcod, Young, Weir, Incorporated
1
Financial Chronicle
The Commercial and
6
Thursday, August 16, 1951
.
..
(600)
Dealer-Broker Investment
the
50 Broad
Paige—Circular—James J. Leff & Co., Inc.,
Graham
passed through two distinct phases,
dividing line between them
being marked by the outbreak of
Hoff¬
Georgia Pacific Plywood Company—Analysis—Walston,
man & Goodwin, 35 Wall
Street, New York 5, N. Y.
mentioned will be pleated
It U understood that the firms
v
.
major increase
was
effected primarily by dollar-
import cuts, initiated by adminis¬
trative restrictions
in the mid¬
Power—Analysis—New York Hanseatic Cor¬
poration, 120 Broadway, New York 5, N.Y.
- ■.
,
Mexican Light &
Outlook—Analysis—Dreyfus & Co., 50 Broadway,
Chain Store
New York 4, N. Y.
Also available is a bulletin on
Lackawanna & Western.
New York
National Oats
Electronics—Bulletin—Dean Witter & Co., 14
clear reproduc¬
tions of 1,001 charts complete with dividend records for the
full year of 1950, showing monthly highs, low§, earnings,
capitalizations, volume on virtually every active stock on the
New York Stock and Curb Exchanges—single copy $10.00;
yearly (6 revised issues) $50.00—special offer of three edi¬
tions of Graphic Stocks, 1924 through 1935; 1936 through 1947
and up-to-date current edition, all for $25.00—F. W. Stephens,
15 William Street, New York 5, N. Y.
"Information Please!"—Brochure explaining about put-and-call
options—Thomas, Haab & Botts, 50 Broadway, New York 4,
Graphic Stocks—January issue contains large,
New Britain Machine
Rails—Bulletin—Francis I.
Laggard
:
du Pont
& Co., 1
Scott
South La Salle Street,
Walnut
G.
Securities—Analysis—Aubrey
Broad Street, New York 5, N. Y.
Municipal
utilities
17
of
showing opportunities
on
45
and
stocks—special
food
introductory
48-page edition
Stocks
.
on
Federal
international
New 1951 Taxes—$5.00—Dept.
N. Y.
scarce
:y
Aluminum
30 Pine
• y-:;
*
Heller
&
Development
in
In the
issue will be comments
same
on
ing the autumn on a possible ap¬
Inc.—Analysis—Peter Morgan & Co., 31 Nassau
Street, New York 5, N. Y.
exchange
should
credits to
The Brit¬
position ac¬
for
held
recent
by
New York, the view
that notwithstanding
developments which
or
the
also
balance
itself
of
but
dollar
Kingdom
net
deficits
Malaya,
of
and
other
ter
India,
Australia,
the
led
Cable
31 Milk
te
Corp.
Data
—
du
Pont, Homsey & Company,
,
Glass Fibers
Durez Plastics
Emhart
Tennessee Products
r'
Mfg.
Korea
sensitivity
economy
to
Situated
.
1
ling
Y.
Security
Dealers
HA
2-2400.
Teletype
Private wires
Cleveland-Denver-Detroit-Los
NY
1-376;
377;
®
were
^on
^
y
Britls.bubalance-of-payments
f.urpl"s Wlth tb? °verseas-Ster-
to
1950
Indeed the recovery
sterling area's dollar posiwas s0 rapid as to permit the
suspension of Marshall aid to the
Kingdom as of the. begin-
United
ning
countries
British
annual rate of
the
six
during
•
18
1951>
of
vance
0f
the
in
m0nths
ad-
termina¬
scheduled
tion date.
This swift erlargement of Bl!lt"
ain's reserves could not be mam~
tained indefinitelY' and for some
time past there have been indlca~
oiiudiea
a
strategic
a si
di
for
serves
the
as
tt
case
through their ster-
•? S
balances
in
London.
of dollar transactions
v-
j
x?
AS
a
overseas
ymenis tnrougn tneir ster
reserve
In the
tions
leg e jmg-Area countries. This pattern
1?uer roie £>riwm seives as a
house
1
u!w recent
more
swlftly, with the result that
+hpir
fraaitinnai
rpr+ain
recession in
raw
the prices of
material
exports
of
certa*n raw maienai expuiis ux
}a,
an
1
the Overseas Sterling Area, coushifted to heavy dollar deficits. nlpH
with
thp
curtailment
of
rpy.cV,;fx
Hollar
Haianoo
p d wim inf curtailment ox
? shift m the dollar balance united States stockpiling and priQf payments 0f ^he Overseas-Stert
invPntorv accumulation mav
£ i
Pnilntrie«5
one
of
inventory accumulation, may
g
a countries was one 01 have exerted an even greater mdollar
cnrnlnses
was
tiansdcuuns, ^
major
causes
of the
British
fllipnrp
Fnrthprmore
the
dollar
thaf (cul,minated, in
ofboth the United King^^ 040°"
' 8P" Area and the 0verseas .St.'irU,?g
dam have risen substantially in
temper, lyty.
oeprUovided ifenxgcdhT„geUnfoerr?ter-S iollf
Association
Tririity Place, New York 6, N. Y.
Telephone:
at
the latter role Britain
uJi
N.
Area
an
October,
from
t^e sterling area was
m0ving toward a more balanced
nnQ;tinn
in
it<?
dollar accounts
crossroad of world trade and fi- ,.f navmpnt*
dicnmtpd hv thp
P°sl?on xlin lts aoilai accounts,
nance
the United Kingdom funcpayments was disrupted by tne uuring the second quarter, the
Iidijce, Uie uiuieu xviuguuui lum.
thereby seriouslv eomnlicattions not onlv as a maior Dro- war thereby seriously complicat- dollar earnings of the Overseasv
not only as a major pro
Britain's efforts to regain dol- otpr-iim? Area countries aooarentducer and trader on its own ac.,iouuie.r
Ai+hn,,^ *hp riniiav
sterling-Aiea countries aypaienv
count but also as the banker for
0
d
e
? L
A*though tb<r dollar ly have fallen off sharply. This
exports of the Overseas-Sterling^
i-..the very large group of countries eAxports °\me uverseas-bternng- decline is partly attributable to
vexy large
01 tummies
Area countries quickly recovered, oPa(snnai factors it is true but the
constituting the sterling area. In th .
Hpllar
^nort/
even
seasonal Iaclors, it is true, put uie
climate
and payments
Troster, Singer & Co.
area
million
March, 1951.
payments under which the
in the in-
members of the sterlins area who
h!
/u ■
•7
x8 1
' - V
settle their international receipts
Primary Markets
Members:
poex-
the
sterling
f^h ^rica and Malaya
nlfWc
TTnitJd
S thf
win
Brit-
economic
of
the
running at
months
usual gold and dollar surpluses of
ternational political and economic
clearing
74
tern of
reflect the
variations
of
unusual
this
$1516
overseas
characterized by a triangular pat-
Overseas-Steiling
sweeping changes in
„
—
of
this
Concerning
international
ain's
sition since
New York 5, N. Y.
Street, Boston 9, Mass.
as
elements
maintenance of
an
international
topic, the article states:
treme
General
in
Currency.
Co., Penobscot Building,
Incorporated—Analysis—Amott, Baker & Co., Inc.,
150 Broadway, New York 38, N. Y. Also available is the cur¬
rent issue of the Amott-Baker Realty Bond Price Averages,
still
are
strength
in
deterioration
to
Favored
that period.
surpius Qf the sterling area as a
whole rose remarkably last win-
the gold and dollar surpluses
sterling
Chas W.
Electrol,
million from the
upon
is
&
Inc.—Brochure—Harriman Ripley
operations, and Brit¬
United
the
counts
Durez Plastics & Chemicals,
& Co., Inc., 63 Wall Street,
Union's
ain received $89
cordingly depends not only upon
Power, New Haven Gas Light, Hartford Electric Light, and
Hartford Gas,
Moreland &
of $635 million equiv¬
the first nine months of
in
combination of
drcumstancesTthe goid'and dollar
dollar
and
Britain's balance of payments,
—
she
the European
EPU during
gold
there
A. Darling — Data
Detroit 26, Mich.
lest
concern
gold to
EPU surplus
alent
currency.
Scranton & Co., 209 Church Street, New Haven 7, Conn. Also
available are bulletins on United Illuminating, Connecticut
L.
lose
Payments Union, the sterling area
as
a
whole actually earned an
members of the sterling area.
Prior to the war, the dollar ac-
—
initial
Britain's
ish
International
have
Descriptive bulletin
Finally, in contrast to
ity prices.
their sterling balances.
Co., Ill Broadway, New York 6, N. Y.
—
who anticipated
in¬
sterling area commod¬
in
creases
Bank of
Audio Devices,
Connecticut Light & Power
probably at¬
speculation dur¬
lished by the Federal Reserve
Croweli-
Service Co.—Analysis—Ira Haupt
have been an in¬
to
seems
preciation of the pound and to
forward
purchases by American
international
in
1950.
of dollar funds
flux
says,
don
Economic
of
of
Position," in the August issue
of the "Monthly Review of
Business, Conditions" pub¬
"High¬
Collier, Jacob Ruppert and Talon, Inc.
Central Vermont Public
article entitled "Brit¬
an
ain's
lights"—-Troster, Singer & Co., 74 Trinity Place, New York
6, N. Y.
expansion
an
factor
in reviewing Britain's
as
half
second
British
dollar exports contributed to this
surplus, an even more important
the
In
Research—Comments
&
the
in
While
Co.,
Street, New York 5, N. Y.
Associated
position,
of $124 mil¬
verted into a surplus
International Currency
has increased usefulness
controls
Inc.—Bulletin—Stanley
Industries,
economic
became con¬
with the dollar area
despite Britain's con¬
adverse balance of payments, sterling remains relatively
in non-sterling world, and recent relaxing of exchange
tinued
CF-5, Value Line Survey, 5 East 44th Street, New York 17,
•
taneously the more or less normal
of
the
United Kingdom
Chicago 3, 111.
of New York,
Bank
Reserve
ex¬
deficit
tributable both to
as
material
raw
result, to record levels during the
winter months of 1950-51. Simul¬
208
Inc.,
importers
four weekly
on
Reitzel,
148 State St.,
available is information on Thermo
>Also
Sterling's Role
supplements, plus
Electrical Equipment, Radio and Utility
a^id Commentary
&
offer
special situations recommendation, supervised account report,
fortnightly letters and
Co., Inc., 105
lion
105 South La Salle Street,
including four weekly editions of ratings and reports with
two
Mass.
value of
the
of the Overse\is-SterlingArea countries, their surplus with
the dollar area increasing, as a
Webster-Chicago Corp.—Memorandum—Carl McGlone & Co.,
15 Electrical Equipment, Radio and Tele¬
Chemical, Drug, Liquor; 37 motion picture and
insurance;
in
King Ry. '
still available in undervalued stocks—also available are new
44
ment has been the
Co.—Memorandum—Blair, Rollins & Co., Inc., 1528
9,
predominant develop¬
spectacular rise
the
phase,
&
Street, Philadelphia 2, Pa.
Boston
dollar-export earn¬
during the
past year to
strengthening its gold and dollar
position.
In this second
U. S. Thermo Control—Data—Raymond & Co.,
y
area
able to devote the huge
reserve
Corp.—Analysis—Jacques Coe & Co., 39 Broadway,
Townsend
sterling
the
Korea,
ings
;6; New York 6, N. Y.
New York 5, N. Y.
vision,
before
has been
increases in its
Co., 621 South Spring Street, Los Angeles 14, Calif.
Tennessee
Calls—Booklet—Filer, Schmidt & Co., 30 Pine Street,
ratings reports
Having thus regained a consid¬
viability
Telecomputing Corp.—Supplemental bulletin—Hill Richards &
1833, 1840 and 1858—National Quotation Bureau,
Inc., 46 Front Street, New York 4, New York.
coun¬
erable measure of dollar
Chicago 3, 111.
Mitchell
Street, Chicago 4, 111.
South La Salle
non-dollar
the
ports
Inc.—Bulletin—Remer,
Talon,
years
analyses
Lerner &
brochure—Smith, Barney
Company—Detailed
Paper
Seabrook Farms Co.—Analysis—Ames, Emerich &
before the Civil War and another nine
in 1900 or earlier. Twenty-three of the
companies have been paying dividends continuously from
seven to seventy-nine years.
Of the other twelve, one started
paying dividends 119 years ago, and its stockholders have
received annual dividends regularly with the exception of
their ancestry to years
Utilities—New
—
and Texas Pacific Land Trust.
had their beginnings
Lanston & Co. Inc., 15
Card memorandum
—
Co., 14 Wall Street, New York 5, N. Y. Also available are
memoranda on Eastern Air Lines, Inc., G. D. Searle & Co.,
yield and market performance over a 12V^-year period.
companies represented in the National Quotation
Bureau's Over-the-Counter Industrial Stock Index, 12 trace
and
Cement Company
dollar
sterling
entire
the
of
the
with
itself
tries.
Company—Analysis—Freehling, Meyerhoff & Co.,
Chicago 3, 111. Also available are
analyses of International Mineral? & Chemical Corp. and
Sylvania Electric Products, Inc.
to
Treasury
with
120 South La Salle Street,
Of the 35
&
and
area
Kingdom
Robert Gair
up-to-date com¬
parison between the listed industrial stocks used in the
Dow-Jones Averages and the 35 over-the-counter industrial
stocks used in the National Quotation Bureau Averages, both
Puts
area
Co., 10 Post Office Square, Boston 9, Mass. Also available i*
memorandum on Gear Grinding Machine Co. and on Seneca
Falls Machine Co.-'*
.y\
Wall
deficits
reduced
a
Over-the-Counter Index—Booklet showing an
the
of 1950 more than offset
Street, New York 5, N. Y.
Riverside
,
first six months
the much
of
the United
which during the
Co.—Memorandum—Cohu & Co., 1 Wall
Oil—Analysis—Van Alstyne, Noel & Co., 52 Wall
Plymouth
Area reverted
dollar surplus,
Sterling
traditional
its
to
The
reappeared.
period
prewar
Overseas
Corp.—Analysis—E. F. Hutton & Co.,
New York 6, N. Y.
61 Broadway,
Street, New York 5, N. Y.
as
that had been
Niagara Mohawk Power
New York.
pattern of settlements
characteristic of the
triangular
Street, New York 5, N. Y.
;
currencies.
area
Company—Data—Chas. A Day & Co.,
Inc., 199 Washington Street, Boston 8, Mass.
Nekoosa Edwards Paper Co.—Memorandum—Loewi & Co., 225
East Mason Street, Milwaukee 2, Wis.
Wall Street, New
by
certed devaluation of
Naumkeag Steam Cotton
5, N. Y.
the con¬
the sterling
As a result, the
strongly
reinforced
Street, St. Louis 2, Mo.
320 North Fourth
Also available is a
on Buda Co.
of 1949, and subsequently
summer
Company—Discussion—Cruttenden & Co., 209
Chicago 4, 111. f If
/
Company—Bulletin—Scherck, Richter Company,
South La Salle Street,
memorandum
a
Chair
Murphy
Street,
list of selected com¬
4, N. Y.
stocks and
York
Delaware,
,
Utilities—Analysis—H. Hentz & Co., 60 Broad
Electric
mon
'
"
without
so
in its dollar
exports. The adjustment, instead,
any
Avenue, New York 18, N.
500 Fifth
did
dollar accounts but
-,y.
•
.
Company—Bulletin—O. B. Motter & Associates,
„Y.
Kropp Forge
the following literaturet
send interested parties
to
Increase.
the first
In
Korea.
phase, from devaluation to Korea,
the sterling area not
only suc¬
ceeded in closing the gap in its
Company—Analysis—Vilas & Hickey, 49 Wall
Street, New York 5, N. Y. Also available is a bulletin on
Southern Railway and on the effects of the Freight Rate
Interstate Power
Recommendations and Literature
in
hostilities
Street, New York 4, N. Y.
378
ling the dollars required by these
oonnWooioH^
t—
countries;
the
latter, for
their
to
Angeles-Philadelphia-Pittsburgh-St. Louis
part, deposit their current acquisitions of gold and
dollars in Lon-
-
sinc<; the'
.
devaluation
of
the
p0Und the dollar balance of payments of the sterling area has
recent
months.
Finally, Britain's
Continued
on
page
39
Volume 174
Number 5038
.
.
.The Commercial and Financial Chronicle
the year,
Britain's Financial and
but I must tell the House
will probably be
a
there
that
deficit in
of corporation
restraint
wages now
Three
and
before
spearate
"the
clearly desirable that
we
the economic
the
and
can,
discuss what
-
I further
ures
meas¬
may
Rt. Hon. H. Gait.skell
be
•required.
In
Budget speech I picked
features of
my
*
the economic situation
—
the im¬
pact of the | defense program itV self; the additional burden im¬
posed upon us by the way in
which the prices of our imports
had risen so much more than the
prices of our exports; and short¬
ages of materials.
should like first of all to say
I
something
though
the
In
some
Monday's debate.
in last
it
Survey
the
that
level
this
duction
production, al¬
extent this was
about
to
covered
of
was
estimated
industrial
pro¬
might be some
4% higher than in 1950. In the
five months up to May, it has ac¬
tually been running about 5%
higher than in the corresponding
months of 1950, so that so far we
have been doing at least as well
as we
expected. But what is the
year
for the
outlook
first
many
rest of the
year?
rather
now
ma¬
brighter. This
is
sulphur,
of tungsten and
molybdenum,
though supplies
of
true
of
raw
would say that prospects
terials I
are
imported
still
will
ments.
be
below
our
require¬
It is true of cotton,
re¬
that,
to
only
2,500,000
the
tons
exports, or at any rate a
large proportion of them go to
Western Europe and occupy a key
position in our trade with those
countries upon
whom we depend
supplies which are ab¬
solutely vital to our industries—
timber, wood pulp^ pyrites, and,
most important of all, the bulk of
the imported iron ore which is
and will be badly needed for pro¬
ducing steel at home.
many
Unless
enough
those essential
supplies and the whole of our in¬
coal
where
export
can
we
risk losing
we
dustrial effort will suffer in
an
insoluble
lies
in
con¬
It is & difficult but not
sequence.
our
problem. The remedy
own
We have
hands.
simply got somehow or another
to produce more coal, and we have
also
got to find means of reduc¬
consumption in ways
which cause the least damage to
ing
home
industries.
our
My
right
■
hon.
Friend is
giving the closest atten¬
this problem, and I do not
tion to
to
propose
anything
say
more
about it now.
Let
ther
This
I
draw
the
for
demand
labor
attention
of credits
until
accumulated, or first.
rules; and,
exhausted, * no
We
have
we
could draw
were
more
gold or dollars would be
paid. Finally, there are certain
special gold and dollar payments
ployment figures
throughout the
the
are
no
more
quar¬
recur.
exports
can
at
see
present,
as
the fourth
lowest
than 1% of the total
employees. This, of course, makes
prospect
primarily
iron
ore
of
a
shortage
of
imported
limit¬
and scrap which is
ing steel output, but despite this
have, I think, a fair chance of
we
reaching
lion
some
a
ingot
production of 16 mil¬
tons this year. With
reduction in stocks and with
the
greatest possible economy in
the use of steel, this should, I
;
some¬
expect
some
further
page
24
Enjoy the
finest-tasting whisky
in the world
consumer
for example, the
rising
result
mate¬
in the
goods. By June,
prices of textile
about 37% above the
were
1950 average.
The prices of metal
goods exports—the process of pro¬
unfavorable, though again I think duction, of course, involves a
it unlikely that they will show a longer period between the work
on the raw material and the turn¬
surplus.
While,
therefore,
we
should not exaggerate this wors¬ ing out of the finished product—
quarter's
results
will
ening of
our
changed
not
be
outlook
some
dollar position,
does
call
so
the
for
corrective action.
for
which, generally, there is a
large unsatisfied demand abroad,
only 12%
were
The government propose, there¬
up.
,
.
It is the
government's policy to
leave it to the judgment of the in¬
fore, to review the dollar import
program, which is, of course, very dividual exporter to decide, in the
much larger
than the program light of his special knowledge,
last year, and reduce expenditure what prices to charge for his ex¬
wherever this can be done with¬ ports.
Quite obviously, no ex¬
out damage to our long-term in¬ porter is likely to raise his prices
terests. At the sqme
clehrly
time
On
press
must
we
^
more
ener¬
getically than ever with dollar ex¬
ports. We look to industry to sus¬
tain and, where possible, increase,
its efforts towards this objective.
I think that the House will agree
that
the
Dollar
Exports Board
rendered
service
great
a
the
to
country by stimulating among
porters an effective interest
ex¬
in
dollar markets. Its successors, the
Dollar Export Advisory Council,
work with
no
carry
on
this vital
less energy and en¬
thusiasm.
in
say
that I have,
kept other governments
the sterling area
currently in¬
formed, and I hope very much
that it will be possible to hold
another meeting of the Common¬
wealth
extent which would endan¬
an
ger his future
not reasonably
Finance
Ministers
at
the
trade, but
we
can¬
expect him to keeb
prices below the international
level; nor would the government
wish him to do this, in view of the
nation's urgent need to increase
export earnings.
;
his
We
however,
cannot,
rely on
if, as
suspect, these will continue in
the export field.
We must also
price increases alone,
even
I
export a -greater volume, and
be¬
the
program, as the Survey
plain, we must look first
of the import impact of
cause
defense
made
Finally, I would
of course,
to
foremost,
and
the
to
industries.
goods
consumer
shall
We
also
need to ensure that the volume of
exports from the metal-using in¬
dustries is at least maintained at
the 1950 level, as the
Survey esti¬
The government is
mated.
already
engaged in discussions with
vidual
industries
on
ways
of
means
in any
increasing
particular
indi¬
and
exports.
M
If
case exports are
A Schenley \
Mark of Merit
held up because too much is going
to the home market, we shall not
hesitate to
trols
that
vert
use
are
Whisky
physical con¬
appropriate to di¬
any
goods to export.
We also have to be
sure
that the
Tbet
by visible exports and re-exports,
THE INTERNATIONAL WHISKY
later, but it is quite clear that we
like this, too,
ever
workers
to
find
more
when it is
urgent to
-
"
Britain's
I
now
External
than
the utmost
secure
Position
turn to the external
say
3,200 million, towards which the
earnings might con¬
tribute
£450
some
million.
cannot
continue con¬
in the first few
when con¬
produc¬ million, compared with actual
sumption is estimated to have
earnings in 1950. It was envisaged
wastage
been
about
5%
higher in real
that a good deal of this increase—
f-.H
terms than in the same period of
a
substantial one —would come
more
practicable increase in
tivity, there must be no
of'labor.
im¬
£
net invisible
posi¬
an
increase
rather
of
over
£500
suming
expect
as
months
from
that
higher
some
export
increase
prices,
in
but
It is too early
outcome
for
the
whole
of
1951,
as
year,
I must now say a
the
yet to predict the
this
1950.
volume
would also be needed.
to
much
of
cause
port
of
prices
the
few words on
increases in
since
the
middle
im¬
of
1950 which have turned the terms
trade
much
against us and
have added so greatly to our bur¬
dens.
These changes are not the
of
so
but the rapid rise in import prices
during the past six months sug¬
gests that, on account of higher
result of devaluation. Nobody dis¬
prices alone, the total cost of im¬
putes, of course, that in the au¬
ports this year will, perhaps, be
tumn of 1949 and the
early months
splendid response made by the able less favorable than that of well over £ 100 million more than
of 1950 there was a rise in the
last year. It is not easy to make the Survey allowed for, even after
sterling prices of some of our im¬
any precise forecast of the trends making allowance for the reduc¬
»A speech by Chancellor Gaitskell in
of the sterling area's gold and tion in import prices to be ex¬ ports greater than, or unaccom¬
the House
of Commons,
London, Eng.,
sterling balance during the rest of pected in the coming months— panied by, a rise in their dollar
July 26, 1951.
miners to the Prime Minister's ap-
on
from higher export prices.
left £2,750 million to be obtained
their
something
Coal Production
about the gold and dollar balance
But it is when we look ahead of the sterling area. The figures
to 1952 that there is ground for for the second quarter which I
serious anxiety, and this brings recently
gave
the House con¬
firmed the forecast made in the
me to the subject of coal. The out¬
put of coal has been increasing, Economic Survey that the situa¬
and the whole nation appreciates tion this year would be consider¬
the
Continued
Prices
portant work elsewhere. At a time
existing labor force fully em¬
ployed ought to release some of
tion, and will first
'
sterling prices, which affected dol¬
and sterling countries alike,
lar
problem of expanding our exports
is not made more difficult by ex¬
cessive monetary demand at home.
I shall have more to say on this
think, support an increase of 4%
in total industrial production dur¬
ing the remainder of the year.
of
compared with the
,
in the current quarter. So far
I
increase
Export prices have been
fairiy steadily, mainly as a
of higher costs of imported
rials, particularly I may say,
field of
good American
end of the year, or, at any rate,
absolute nonsense of any sugges¬
crop this year has eased the situa¬
tion that rearmament would lead shortly afterwards.
tion. On the other hand, shortages,
I come now to the prospects of
to
mass
unemployment in this
of nickel, copper and zinc all re¬
the United Kingdom's balance of
country and that before the mid¬
main acute, though they may be
dle of the year there would be payments, In which, as the House
eased to some small extent, at any
considerable numbers out of work will recall, our objective was to
rate, by substitution.
because of shortages of imported maintain an overall balance apart
In my view, the biggest direct materials.
from imports required for stock¬
check to the expansion of our in¬
It was estimated in the
In fact, there are far more jobs piling.
dustrial production at the moment than men and women to fill them. Economic Survey that the
1951
is
the
shortage
of steel.
It is Firms which cannot keep their import bill would amount to about
the
both dollar and
quarter in the second
year
can
revenue
Too much, therefore, should not
be concluded from what happens
continuing high
since September, 1945, and repre¬
sent
during the third
a
Export
under the
those
substantial increase
a
average
certain, and indeed, I think, thing like
unlikely—we should finance it out half of the
of
whole economy. The latest unem¬
means
—an
means
will, I know,
however, say one fur¬
thing in connection with pro¬
me,
the House to the
concerned
here
ports, again excluding stockpiling.
should the adverse bal¬
with the European Payments
Union continue—which is by no
ter which will not
duction.
For
impact, of course, of
coal exports, and in
on
are
rise in
second half of the year if we art
to pay in full for our current im¬
ance
to be made
for
three outstanding
out
Given
rearmament.
to
these
"
as we
this is directly at¬
against 6,750,000 in the corre¬
sponding months of 1950, Most of
t
far
as
tributable
amounted
'
} ahead
have
we
ceived from the Union. After
first five months of the year these
then,
e c
which
to be
have
p r o s p
dollars
the coal shortage inevitably tends
place
examine
•
not agree that
we
a
million.
£ 1,300 million. It looks as if we
virtually the whole of the rest of shall need £1,600 million in the
the
peal. But home consumption is
rising even faster, though I can¬
The
developments
since
unlikely how to exceed £400
are
well pay out during this quarter
more
the rearmament program.
should review
which
I think that tne invisible earnings
Wnat
with is
—
employment and rising pro¬
ductivity, the industrial use of
coal would probably be just as
high if we had not embarked on
Summer
taken
however,
prices, but this movement had
largely spent itself before Korea.
quarter. Secondly, we shall year—even excluding the stock¬ rise in dollars of 85%; that of
continue, I think, to lose dollars piling, which is excluded from all wool, a rise of 129%; of tin, 138%,
to the European Payments Union the import figures I have given. and of rubber, 162%. These are
again largely on account of In fact, export earnings in the the peak figures. Between June,
seasonal factors. In fact, we may first half year were only just over 1950, and March, 1951, the average
full
we
for
Recess
special
for this.
of course,
have
passed since the Budget and the
publication of the Economic Sur¬
vey, and it is
account,
normal
Concludes granting of higher
would disrupt British economy.
half months
a
little
a
and, therefore, could not possibly
buying
an exceptionally large amount of
Consequently, export earnings have been due to any change in
dollar imports during this quarter, will have to be
considerably above exchange rates. Thus, compared
probably spending at least 100 the survey target to keep the with June, 1950, the price of sugar,
million dollars more than in a overseas accounts in balance this in dollars, showed at its peak a
Britain
dividends, continuation of subsidies, and
which I shall have
to say later on. The invisible
more
one.
First of all, we shall be
credit expansion.
to
are,
about
too, has developed-less
favorably, and in 1951 as a whole
substantial
reasons
In a Parliamentary address, Britain's new Chancellor of the
Exchequer reviews difficult financial and economic situation
and prospects that lie immediately ahead. Advocates conserv¬
ing scarce materials, increasing productivity, and larger meas¬
ure
of price and wage controls.
Outlines Britain's difficult
external trade and exchange situation, and proposes limitation
<
quite
a
There
By the RT. HON. HUGH GAITSKELL, M. P.*
Chancellor of the Exchequer, Great
the third quarter—pos¬
sibly
Economic Situation
9
(601)
World's Choicest Blend
BLENDED WHISKY B6.8
PR.
THE
STRAIGHT
WHISKIES IN THIS PRODUCT ARE 8 YEARS OR
MORE OLD.35% STRAIGHT WHISKY,65% GR.«
NEUTRAL SPI»I5.SCHENIEYDIST., INC., N.Yj*
10
The Commercial and Financial Chronicle
(602)
cembe'r, 1950, were $36,398,522,
against $29,459,873 in the 1950
period.
Missouri Brevities
Stockholders of Spencer Chem-
from investment bankers desirous
Earnings
of acting tor the City of St. Louis
special meeting on Aug. 15 to au125.000
in coordinating a program for financing "off-street parking facili-
second pre-
ties" via the issuance of revenue
after
in
Objective of the city is to
offer revenue bonds which will be
dends
Company
thorize
shares
of cumulative
ferred
stock
and
at
increase
an
debt from the
funded
authorized
of
issue
new
a
asked
were
limit of $13,000,000 to
$17,000,000. According to a regispresent
SEC
of
the
will
stock
the
holders of the
to
in the ratio of one share
common
of
3,
Aug.
on
be offered
first
with
filed
statement
tration
preferred for each eight shares
The preferred will be
common.
convertible
into
bonds.
attractive from an investment standpoint and can be marketed on the lowest possible interest cost.
Validity of the proposed issue of $3,500,000 parking
revenue bonds was upheld by the
Missouri Supreme Court on July
most
13.
shares
common
include
Business Still Holds
two-for-one
1951,
April,
Steady at
610,884 shares, which
on
the
split
in
Trends in total factory output
and
were computed
for accrued divi¬
allowance
Estimated
Federal
Moderate declines in a number of fields. Significant
taking place. Demand for goods remains strong. Agri¬
shits
and
income
cultural
profits taxes for the 1951
period
were
$1,409,446,
com¬
pared with $720,617 a year ago.
*'
*
Moss
University, A Correspondence Institution, Chicago, Illinois)
Hartnett,
St.
Louis, are offering an issue of
40,000 shares of Missouri Research
mulative
period of 10 years and will
a 3% sinking fund. The of-
The large investment demand
that attended re-offering of the
stock
fering, assuming stockholders' approval, will be underwritten by a
group headed by Morgan Stanley
& Co. and Glore, Forgan & Co.
recent issue of $6,650,000 St. Louis
School District, Mo., bonds is attested by the fact that approximately two-thirds of the issue had
of crops.
(From "Business Bulletin," issued by the LaSalle Extension
*
&
(Mo.)
Inc.
favorable, with close to peak production
prospects
excess
Morfeld,
High Level
a
and business volume slightly
upward.
the $4.80 preferred stock.
on
Laboratories,
*
*
*
based
are
Thursday, August 16, 1951
.
.
common
for both tne 1951 and 1950 perioas
a
leal
share of
per
.
convertible
5%
cu¬
preferred
Stability in the total output of
than 15%. Summer slow¬
up more
goods and in business volume, but
ing down has taken place during
widely
the
diverging
trends
among
aspects of economic activity,
many
vacation
period, but the de¬
been less than
cline in output has
purposes
for
a
carry
of the
Proceeds
preferred,
new
$5,100,000 to be obthrough sale of additional
with
along
tained
funded
debt
in-
institutional
to
business on the day of the award,
The bonds, bearing interest rates
1/2%,
and
1 A%
2%,
°f
were
awarded to a syndicate managed
by Halsey, Stuart & Co. Inc., and
chemi- including, among others, Stifel,
cal works to be constructed by the
Vicksburg, Miss.
has received a cer¬
tificate of necessity permitting it
near
company
The company
to
charge off for Federal tax purabout 50% of the cost of the
($5
par
share;.
per
The
proceeds will be used by the
company
for
general
corporate
Nicolaus
&
Co.,
George
and
Inc.
K. Baum &
Co., both of St. Louis.
The
mature
bonds
from
serially
1953 to
district
is
The school
1971 inclusive.
co-extensive
with
V
Missouri Research
loans.
Lab¬
agreement would have
signing,
engineering,
turing and assembling
manufac¬
fense program.
electronic
felt
equipment
for
the
government
and other business under
services
contract.
City
income
Net
of Anheuser-Busch
supported by the same tax base
a® those of the city itself.
$6,619,158, equal to $1.47 per
share of common, compared with
was
share
Tor the quarter ended June 30,
by Monsanto Chemical Company 1951, the net earnings
of the
with six investors covering the McQuay - Norris
Manufacturing
sale at par of 50-year 3%% in- Company, after the usual reserves
on the issue
payable an-
$214,668.48, compared to $191,111.49 earned in the same quarter
25
the
Under
the
ment
to draw
of
terms
the
has
comDanv
agree-
the
down^tt?" monies
ri»ht
at vari-
dates
through April 30, 1953.
Qinirina
f„nH
rtavVnonto '
'
Sinking fund
mencing after 30 years are to be,
ous
requirements
amounted
the
on
ne ^
For the
off
one-half
to' retire
share
^
,
months period ended
six
June 30, 1951, net earnings, after
is made for optional sinking fund the usual reserves and normal tax
payments during the life of the provisions, were $588,438.68. Pre¬
the
issue
Provision
by maturity.
Proceeds
comoanv's
pX
ous
a
will
used
be
for
the
plant at Soda Springs, Idaho,
plastics plant at Cincinnati,
Ohio, and for expansions at Texas
involving
facilities
natural gas
raw
Acrylwitrile is
maieuai
101
material for Acruan, the
Acrilan me
synthetic fiber to be pro¬
duced
by the associated Chemstrand
Corporation.
Funds also
new
are
rj'
required by the
company
of^ per
ihes
investment in this company which
jointly owned with American
Viscose Corporation.
Chemstrand
at present is constructing plants
Were
earnings were
'
$201 031 80
$201,031.80
to $35,481,39. The profits remainlng £or common stock £or that Pe"
Ala., and nylon at Pensacola, Fla.
catur,
*
*
*
Proposals will be received by
City Comptroller Milton Carpenuntil
midnight
Sept.
on
15
insn
1950
riod in
ssn
mora
ai
$165,550.41, the
equivalent of $0.47 per share.
were
*
*
*
For the 28 weeks ended
July 14,
Estimated net profit after taxes
to $1.57 a
share, compared with $1,175,743,
or $1.60 a
share, in the same period last year. Net sales for the
1951 period, including the Buf¬
falo, N. Y., plant acquired in De-
share
a
under
said, and despite government
re¬
de¬
cline
was
in
building
on
a
construction, the outlook
good. |
Directors
of
Gleaner
Harvester
Corporation
declared the regular
dividend of 50 cents a
quarterly
holders of record
*
*
Warren Lee Pierson,
and
Ralph
S.
Chairman,
Damon,
President
share
of
in
1951
$2,603,000 or
the first six
as
compared
to
$1,029,000 and 42 cents a share in
the same period last year.
Federal income taxes
to
amounted
three
or
times
getting
W.
T.
operating
A.
hit
$66,416,000
for
all-time high
which
was
of
in¬
an
of $15,519,000 over 1950.
crease
the
an
revenues
At
time, operating costs ad¬
only $12,817,000. The big¬
gest part of T. W. A.'s increased
same
vanced
from
was
who
carrying pas¬
purchased $14,693,more
than in
revenue
1950.
from
revenue
28,097,000
of this activity
fices
at
to 30,757,-
of¬
226
West Lamar Street,
in the securities busi¬
FAIRMONT, W.
Burt
L. D. 123
&
Watson
Va. —Hazlett,
have
the next few
Actual
above
rise
will
expenditures
al¬
levels,
present
is
subject
tion.
considerable varia¬
most important
to
One
of
the
connection
in
with
the
is that of decid¬
the final
designs of equipment and when
to begin mass production. If the
ing when to settle
upon
decision is made too
soon
far in advance of needs,
and too
later im¬
decision is made too late, not
enough
it
is
will
needed.
be
on
ev^n temporarily,
sions
are
mass
production of much
eased
ment will be
amounts
equip¬
deferred, and smaller
of
materials
less
and
will be taken for mili¬
manpower
tary
when
hand
If international ten¬
Even
purposes.
under
these
conditions, however, expenditures
for
plants, machinery, and
equipment are likely to be main¬
new
and
incomes
power
10%.
sustaining force for business ac¬
tivity and for prices. More people
are at work than ever before, and
the total
ployed
number of workers
em¬
jobs has risen
in civilian
to the all-time record total of 61,-
800,000.
Changes in their buying
are
quite as significantin affecting retail sales as are the
changes
in
their
incomes. Al¬
opened
a
though
not
consumers are
currently
aggressive in their purchas¬
so
ing as they were during the buy¬
ing splurge of last year and early
this year,
they are spending more
than they did a year ago.
money
As
long
will
ness
this
ajid
Up
be
Business Volume
Over
spending
ordinarily
Production
15%
same
the
of
index of the Federal Re¬
at
has
less
fluctuated
far this year. It is 12%
higher than it
was a year ago
and
This index
measures the physical
quantities
of goods being turned out and in¬
cludes military supplies as well
as civilian goods. Business valume
as measured by financial transac¬
tions through banks has also been
stable,
except
for
the
usual
a
peacetime peak.
seasonal
variations.
the
It
is
11%
higher than it
Hazlett.
electricity is
up
last year, and about the
increase has been made in
over
output of petroleum. Produc¬
tion of steel has established
record of
new
a
52,000,000 tons dur¬
ing the first half of the year. That
over
was
the
above
increase
an
of
corresponding period last
is
11%
the
production during
It
significant because demand for
steel is
large
measure
a
number
of
of
year.
activity in
industries,
a
es¬
pecially those making machinery
and equipment. It is also a meas¬
ure
of the amount of construction
which
is being carried on. The
industry has been operating
steel
at
above rated
capacity for
many
months with weekly output in ex¬
cess
of
Even
2,000,000 tons since March.
that
large
meet the current
filled
orders
Controlled
was
output does not
demand, and
remain
Materials
actual
output
in
under
are
the
which
Plan
started last month
than
un¬
large
Allocations
amount.
greater
also
and
now
larger
than
prospective
output
during next month and the fourth
quarter of the year.
The
also
construction
been
ing than
making
a
industry
has
better show¬
generally expected
this year. Although resi¬
building has declined, this
drop has been more than offset by
was
increase
construction.
so
account
for the largest amounts of changes
in general business activity.
?
the
10%
Output of factories and mines as
indicated by the industrial pro¬
Board
level, busi¬
Variations in
good.
dential
•
Production
expenditures
as consumer
remain at the current
earlier
increased.
even
branch office at 313 Adams Street,
under the direction of Arch M.
*
over
amount
months.
than 1%
Hazlett, Burt Branch
Garfield 0225
arranged
miles
has been formed with
engage
many
on
will be felt in more
marked ways during
serve
Son
way
were
time ago, and the full force
tained
ton miles
J. F. Leonard & Son
Exchange
under
which
contracts
the
1
AMERICUS, Ga.—J. F. Leonard
Mo.
is
Production
than
more
in the first six months of 1950.
Total
those of
as
has risen by
Large consumer
constitute
a
powerful
purchasing
well
call
the future
for
increases.
further
for
duction
Building
St. Louis 2,
schedules
and
a* provements may make the equip¬
ment obsolete before it is used. If
$2,434,000, approximately $1
share
ness.
Landreth
rpilitary purposes is steadily
a
earned
SCHERCK, LIGHTER COMPANY
Bell Teletype
SL 456
expanding, and production
$1.07
to
Stock
is still
The defense program
defense program
&
Midwest
ones.
decisions
Argo Oil
Member
are
posite
Inc.,
000.
Quoted
ac-.
stronger than the op¬
higher
lines,
Southern Union Gas
—
business
push production and trade
announced that Trans World Air¬
flown
Rockwell Mfg.
far available
though the rate of this spending
*
its total number of
Texas Eastern Transmission
tend to
much
Aug. 31.
jumped
from 80,011.000 to 110,716,000.
T.
W. A. also substantially increased
Delhi Oil
so
and
tivity shows that the forces which
share, payable Nov. 20 to stock¬
Total
Tennessee Gas Transmission
industrial
to
as
some
the first six months of
Sold
and
declared
000 worth of tickets
Harshaw Chemical
—
year
strictions
sengers,
Spinning
Petroleum Heat & Power
Bought
a
ation, the evidence
for
revenue
Berkshire Fine
was
Regardless of the outlook for
changes in the international situ¬
the company are op-- increasing. This expansion has off¬
crating at full capacity, the report set the declines in other fields,
$1,153,183, equal
was
cents
months
Interstate Bakeries Corporation,
bad an increase in sales, but a
lower estimated net profit, the
interim report revealed,
for manufacture of Acrilan at De-
quarter before taxes
to Provision for preferred
pnor
for
is
fer
'
rec¬
period amounted to
^2, the
\™rQ
of
stock
on
much
as
attitudes
Plants of
stock dividends which amounted
W
from
the
ments for that
require¬
$34>243-56- The earnings remainphosphor- ing £or
stock were $554,-
which includea
Texas
dividend
might result in a
of
government
spending for military supplies and
equipment.
There might also be
less urgency on the part of busi¬
ness firms to push their expansion
programs,
and consumers might
prove less active in their buying.
down
not increased
factory employees* total consumer
,
ago.
exoansion
current
new
Citv
stock
ferred
debentures.
20
or
each °* the 355,939 shares out-
*ymen£ com-
sufficient
per
tensions
slowing
Predominant
up
s£ock TLeJ191'55^
equivalent of $0.56
the
interna¬
of
Clay Manu¬
about $250,000, the per share
earnings after taxes were $1.55,
U0 09- The pro£its remainin2 for
^mmon
share
a
Many businessmen
easing
any
*
Dickey
Company on Aug.
10
third quarter dividend of
a
an
the de¬
Constructive Factors Still
*
S.
W.
cents
for
tional
year ago.
July 31.
The company re¬
ported that while the net income
$17,-
to
tnat
such
on
per
ord
Preferred stock dividend
of 1950.
nually only if earned.
$1.50
or
facturing
paid
and
$6,759,139
¥
and normal tax provisions, were
Interest
a
The
debentures in the amount of
cumulative
of
net
a
Agreements have been executed
effect
the
and
cease
oratories is chiefly engaged in de¬
plant, excluding land, over a
five—year period.
is
-
Factory employment is close to
outstanding. The additional there has also been a certain and to larger overtime payments
to enable the company, amount of hesitation, because of as more hours are being worked
to obtain larger Army
projects, the uncertainty as to whether or, each week. Although incomes for
which will be financed througn not active fighting in Korea would most other groups of workers have
for the six months ended June 30
$66,000,000.
during the
now
of St. Louis and its obligations are
come
business
of
past few weeks. While produc¬ 15% higher than last year, and
and to retire 324 shares tion schedules have been main¬ factory payrolls have increased
of $20 par value preferred stock, tained and in some lines increased,, 25%, due to higher rates of pay
poses
new
acteristics
usual.
been spoken for by the close of capital is
vestors, and other funds, will be
used to meet the approximately
$14,000,000 cost of a new
at
net
have been the predominant char¬
was a year ago. In
this rise is included the change in
price level,
which has
gone
in
other
forms
Industrial
of
building
has
increased 100%, commercial
building 48%, and construction of
military
facilities
over
500%.
Total
the
outlay for the first half of
year
increase
was
of
$14,000,000,000
16%
over
the
an
corres¬
ponding period last
year. Closely
spending are the
expenditures by business for new
plants and equipment These are
related
to
this
being made at the
$24,000,000,000 annually,
now
crease
of
more
than
rate
30%.
of
in¬
an
Most
recent estimates indicate that pos¬
sibly
higher
the
rate
rise
may
regardless
Continued
of
on
even
possible
page
27
Volume 174
Number 5038
■
.
.
The Commercial and Financial Chronicle
.
■
'
*#
(603)
,
both essential to the economic
are
No Deficit
Financing,
But No Complacency
Secretary of the Treasury
"
•
•
■
is essential ingredient of
has continued to
hopes of all the free
habit.
of
all aware, of course, that
have risen greatly
since
prices
'But
have
incomes
moved
after
ahead
taxes
faster.
even
The
truly significant fact
the world.
peoples
of
As
a
Today that strength is cumulated a
being
chal¬ $200
billion
history
be
that
to
been
thrift
which
—
and
attention
little
American
an
lenged by the These savings
c o n
tinuing
has
States
eat
the
average
income in the
United
today, after all taxes, local,
and Federal, will buy al¬
sible,
of
end
the
in
C
to
munijst
o m
nations
The
aggression .in
Korea
was
preceded by
a
chain of other
This
power.
helped
recession
build
standard
40%
in
more
actual
of
1949;
years.
:
-
'
.
Today,
in
;It
American
living to a new allthe past several
•
-
\
•
1\
m
There has been
precedented
postwar
time high during
the
in
incomes
of
i the
growth
This
group.
growth
a
economic
we
spired in the postwar
on
that
by stopping the Korean ag¬
gression we have definitely check¬
Soviet
dictatorship's
ambitions—any of these
extremely
attitudes
costly
to
us
and to the free nations with which
allied.
What
all
the
1
Our
.
No
our
skills, of
rials, of
and of
but
manpower
of
power
also
productive
our
factories and mate¬
our
financial
our
strength,
faith in human liberty
the Soviet
Once they see that power
our
national
of
defense
thrift
takes
mobilization
:
<
to
or
will
program
The
save.
confine
wise
ourselves
course
to
is to
non-infla¬
income
of
the goods available
buy.
ready been made toward that
free
of
nations
our
•
which
and
so
great-
earnestly, and in which so
investment of our eco¬
steadily
terial
and
by day.
courses
so
have
goals
Power-
power for
There Has Been No
•;
Deficit
>
potent indeed
'
when
Financing
At
this
inflation with which T
about
sure
am
of yoii have been conThat is the idea that the
many
frohted.
1,000
or
10,000
as
many
bond
~
thrift influence
as a
closing
are
point, I should like to
briefly upon an idea
comment
rise in the
price level which we
experienced since the end of
been the
flation
sales
volunteers
$25
more
simultaneously. '*■
Small
investors have
stepped
the number of $25 and $50 E
Bonds they have purchased this
up
year
i,
diverted
This
attitude
.
,
-
preparedness
will
dare
to
available
reduced
were
by more than $25
on
which
try to
over¬
us.
nancial
ual
power of our fi¬
,
We
need
home
fall
to
and
,
in
reach
into
every
every
that
I do not want you to
that with regard to the Gov¬
ernment's fiscal affairs I am com¬
Thrift, individ¬ placent about the future.
collective, is a source of
;- ^ ^
,
time to
•
That
relax
is, of
is
defense
body's job, and that
think, how¬
strength.
and
this
numbers, and with an
supply of enthusiasm.
cent causes.
■
I spoke of the
our
every¬
is not the
now
defense efforts.
the message
—the purpose—of the nationwide
defense bond drive which we are
course,
opening in September, and which
you as key men in this great drive
has always been one of the great
Go Basis
' .-l ' will be
sources of our productive
spearheading.
power.
I want to emphasize that our * The symbol of this drive, as you
The cumulative savings of Amer¬
icans have created capital to fi¬ plans for a Defense Bond drive do know, is to be our national em¬
not signify
any
departure from blem—the great American Eagle,
nance over the years a
great sup¬
ply of productive facilities. These the Treasury's stand in favor of standing on guard, ever vigilant,
that
-strength.
*■
American
thrift
No Departure From
facilities have turned the products
paying-as-we-go
of
well
farms,
our
into
our
the
mines and
materials
equipment'which have made
our
and
pos¬
as
for
the
I'ay-As-Yoti-
defense, as and ever strong. Behind this drive
ordinary costs of should be put every ounce of the
for
The
Government.
tions of the
-
recommenda¬
Treasury for pay-as-
a
constantly rising standard we-go taxation, laid before com¬
mittees of the Congress in recent
living.
•
It is an encouraging aspect of weeks, are not modified in any
power
sible
and
•
respect by
*An
ference
address
of
State
by
Sec.
Snyder
Chairmen
of
and
at
Con¬
Directors
U. S. Savings Bonds
Program, Wash¬
ington, D. C., Aug. 3, 1951.
increase
our
the
intended efforts to
sale
of
bonds
stantially during the fall.
program and the bond
sub¬
The tax
program
good citizen
for
Our
the
future
nation
powerful nation
have
a
of
has
as
America
America.
become
it is
a
voluntary
for the defense of
saver
>
of every
volunteer worker and
of
fc
Inquiry
de¬
coming
drive, I should like
bond
determined spirit
are
in
which
they
shouldering responsibility in
this
great
and
you,
defense
effort.
rendering
are
They,
great
a
tional
our
drive
for
peace,
progress
and
prosperity, for ourselves
for
men
of
goodwill
the
and
world
around.
Fiscal and Monetary Policies
on
on
Economic
Report,
i
Rep-
P
v e
a
t
the
have
two
taken
present
general
credit
management.
"Furthermore, there have
the
and
the
the
be
our
developments
•
been
in
the
relationship between the Treasury
in
and
hearings
of
debt
important
elapsed
since
both
and
-
which
years
on
controls
on Aug.
pointed out
that
must
thinking
Texas
9
possibility
into account in all of
of
a n
armed
preparedness
make net Federal borrowing,
necessary
in
the
years
ahead.'
This
Wright
m
continuous
may
resentat i
the
Federal
the
Reserve
relationship
Federal
System
between
Reserve
System and
President since the previous
hearings. ..The most important of
these developments occurred dur-.
ing the first half of this year;
Despite
their great economic
pre-
the
4
vious.i Sub¬
committee
on
Monetary,
C redit
a n
d
Fiscal Policies
have
Wright
Patman
been
V
,
packed
with
important
events
and that the economic background
significance,
no
reference
was
made to them in the Midyear Rep0r(;
Council
Advisers.
of
that the
developCongress.
and; monetary policy has significance
of
these
changed drastically.
i^ients-be assessed by
-"The
Subcommittee consists
new
pf^Sen. Paul - H. Douglas of Illi-
Economic
It is necessary
of fiscal
in this connection the Subcommit-
should review the directives
nois,
Rep.' Richard
Boiling
of
monetary
policy and debt
Missouri, Sen. Ralph E. Flanders management given
by Congress to
of Vermont, Rep. Jesse P. Wolcott
the Executive Branch and the al-
pf
Michigan,
as
Chairman.
and
Patman location
Rep.
the
At
tee
he
time
the
of
responsibility for]
carrying out these directives.
appointed the Subcommittee, Sen. v «The
possibility of the proJoseph C. O'Mahoney of Wyom- longed maintenance of continuous
ing, Chairman of the full Commit- armed preparedness also makes it
inquiry urgent for Congress to
inquire
problems
and
generally into the debt manage-,
relationships of the government ment and
monetary policies necesAgencies responsible for general gary and desirable for
financing-
the
Pn
credit
current
•"
the
because
a
Federal
debt
-
manage-
Reserve
Sys-
tem and the Treasury Department.
Representative* Patman pointed
when
out that in the fall of 1949,
the previous Subcommitte held its
country
hearings,
the
members
whether
economy
of
preparedness
and
for
con-
taining the inflationary pressures
t0 which it naturally
gives rise.
Among the matters to be considjn
erecj
this
connection
are
relationship of general
proper
the.
and
was
was
the
principal
overhanging
the
that of inflation or
recession—although
the
pre-
ponderant view even at that time
that the primary
was
inflation.
inflationary
ceived
to
lie
hazard was
the causes
But
of
this
hazard were
conprincipally an the
a "boom
Subcommittee,
intends to make
0£ these
in. the private sector of the economy.
The
,
..
...
of
announcement
the
new
inquiry stated as follows:
"Today the situation differs in
two respects.
In the first place,
barring a substantial improvement
.
of
an
intensive study
matters and expects also
t0 make
tUre
inquiry into the struc-
an
the
particular
banking system with
reference
to
its
ade-
longer period to
maintain the dynamic character of.
the economy by serving the needs
qUaCy
over
sman
possible development of
«jn
a
business,
order
to
assist
in
its
in-
qUiry, the Subcommittee intends,
jn
the
wiatten
sons
near
future, to address
questions to various per-
jnside
and
government who
outside
of
the
qualified to
gjve ^ thoughtful suggestions and
are
expectg to Hold a series of public
homings shortly after the begin-.
.
international
the
in
situation,
acter' oT'the""pr^cipll
the
solved—that
In
appears
economy
the
when
hazard
second
it
we
nation
then
hazard
ning of the new yea, In order to
to
is
be
inflation,
place, unlike
could
be
dis- assist in the preparation of this
stated
material and in the organization
1949 of the inquiry, the International
with
Monetary
Fund
has
been
good
can
that the Federal Budget
enough to lend to the Subcommit-
could and should be balanced and
tee the services of Dr. Henry C.
assurance
recognized that
and
control
ment—the
■
forests
defense
to ask you to carry to
your local
workers my sincere thanks for the
just selective credit controls and
poscreditable recovering from a mild recession,
gible new types of reserve re—
abundant and there was some doubt on the
quirements and of public debt
part of witnesses and Committee instruments.
The
community
of those facts we must look in
throughout our land and bring to
other directions than Government
every American the personal real¬
fiscal policy to find inflation's re¬
ization
ever,
(;
-
advertising industry is giv¬ tee, asked it to focus its
„
billion.
the
The
sim-.
„
ma¬
from
.
of most of the in¬
cause
evils.
ing " to' the Defense. Bond Drive
support fully comparable to that
For the five fiscal years which
which it provided so generously
ended last June 30, the United
and effectively in years gone by.
States had a net over-all surplus
Preliminary reports to us indi¬
of receipts over expenditures of
cate
that
volunteer
salesmen—
approximately $7.5 billion. Dur¬
those public-spirited: people who
ing the same five years, the debt
through
personal
solicitations
of the United States was reduced
really spell the success of all our
$15 billion, and commercial bank
bond-selling /efforts— will
be
holdings of Government securities
pro¬
power,
wisely embarked, we may
every hope that no hostile
power
come
the
mind ^
this
see
be
of
made,
the
' single sale of a $25 bond becomes
*
spiritual, growing day
That is not deficit financing. It
we but resolutely re¬
is just the contrary. In the face
If
to
in
peace,
tections—we
been
achieving
had
we
power for
fuse
has
resources
which
we
long
so
an
nomic
are
us.
have worked
we
As you go out to
organize your
State and community activities to
assure
the success of the
.
"V
difficulty of curbing inflation.
Other ply disregards the facts.
power.
steadily gaining
The plans for
action by the free nations
common
on
irio-
are
strength with
depends./
Rep. Wright Patman, Chairman of Subcommittee on General
Credit Control and Debt
Management of Joint Committee on
Economic Report, announces that new
developments since
hearings held two years ago made renewed inquiry desirable.
for them
:
.
-/A great deal of progress has al¬
bilization
nation.
our
nation in
mobilizing
the power of thrift behind our na¬
~
finer example of living
New
individuals
-
,
•
mentjDf the Joint Committee
after
the payment of taxes, still have in
their hands large sums to spend
ef¬
,
by better than 11%. City
after city across the country has
rulers.
have
undertaken successfully in recent
completely
organized and
acti¬ World War II has been due in
months to win a Treasury Flag
vated, these rulers may decide large part to methods of Govern¬
for expansion of Payroll Savings
that peace is better for the world ment financing — that deficit fi¬
Plan activity among its employ¬
after all.
;
;
'
•
nancing in the postwar period has
ers.
object lessons for
as
cause.
of
power
is upon this constructive
that the peace of the world
people working together in; service to
common
front defense. A slogan which has
been suggested for the Defense
I Bond Drive is
"Bonds for Power
;By putting our earnings into for Peace.'^ These five words sum
personal savirigs rather than into up the substance and the
spirit of
the commodity markets, we help
the appeal which-we are making
hold down the
prices of scarce with all earnestness and all vigor.
goods and services, arid lessen the It is a slogan with truth in' it. A"
to
<
have to do is mobilize
we
only
its
middle
are
greater importance.
even
and
years.
Complacency, ; relaxation, the
lowering of our guard, the idea
not
con¬
it
power
greatly
>
enlarged the market for the prod¬
;
In
ucts of American agriculture and
announcing the program of offset
inflationary developments
the
industry — and greatly enlarged,
.Subcommittee
on
General in the private
economy, it is now'
also, the possibilities for profitable Credit Control and Debt Manage- possible that' the
exigencies of
-
all-out
our
spendable
i
nation is to
our
power
of
has
"
are
be
seek now—as
they sought in the
past—to destroy the liberty of the
human spirit and the
dignity of
man.
For in the final
analysis,
the power of America is the
un¬
An assumption that such
require a substantial portion of ;
tionary spending and to save reg¬
incidents will end if a cease-fire our available
manpower and ma¬
ularly out of our incomes.
is achieved in Korea would
disre¬ terials.
Consequently, there will
The defense bond program is an
gard the plain, expensive lesson be a considerable
gap between the
essential ingredient of our home
derived from all that has tran¬
we
neces¬
a
powerful bulwark
against dictatorial aggressors who
history
nearing the business operations.^
peak of the tooling-up period in
Individuals, collectively,
as
world.
be
It
same
ducted for the people
by the peo¬
ber.
purchas¬
a
in
the
up
incidents fort, the practice
■which gave warning of the Krem¬
lin's intentions to dominate the
could
democracy.
and services than the average per.
of purchas¬
reserve
helped avert
power
business
the
to
remains.
the
if
to
the opportunity
directly in strengthening
'
tremendous supply
a
shooting ing
the ing
free
mated
now
sary
other forms of liquid
Korea,
threat
t
dynamic
spirit,
this
dynamic force, which is so
savings bonds, bank capita income in 1939.
• J
;
savings
accounts A and
Moreover, people today, can buy
assets.' ,The things which in earlier
years were
Despite the great savings reservoir has pro¬ either not available at
all, or were
signs of a pos¬ vided the American public with available
only to a limited num¬
S.
genera¬ And
the
goods
most
savings.
deposits,
r
Communism,
•John W. Snyder
this
succeeding
built
American
every
to share
spirit that the economic
mocracy can be found than in our
defense bond program.- It is con¬
State,
in the form of
are
that
of
have
ple of the United States and gives
United States
t h
liquid
.
capita
per
result, Americans ac¬
postwar backlog of
in
given—is
tions
tinue
are
one
The strength of this nation has
become
the
inspiration for. the
this
American
*
economic
in
national
same
1939.
Stresses rise in individual incomes despite high taxation.
our
is
is
We
home front'defense.
our
It
force of
the pending tax program is
only necessary, but can be ab¬
taxes, a
good
margin
profits and incentives.
power,
program
freedom.
their
and
Americans
after
progress has been made in mobilization V
Secretary Snyder warns against complacency,
relaxation, and lowering of our guard. Denies Treasury has
resorted since war to deficit financing, but says Defense Bond-
i
J.
liberties
that
'
■
••
Though asserting great
our
sonal
and
expenditure
pros¬
pects, but I do want to point out
revenue
sorbed by our economy and leave,
of
to work together in
cooperative
effort to preserve both their
per¬
not
By HON. JOHN W. SNYDER*
■
welfare of the country.
I do not at this time want to
go
into any detailed analysis of our
11
be strong and free only when its
individual citizens are free—free
a
surplus developed
in order
to Murphy as Economist."
32
The Commercial and Financial Chronicle
(604)
essential
Developments in Selective
Credit Control
mental
Bank, England, reviews policies and results of govern¬
credit controls in Australia, New Zealand,
regulation
Says results thus far
new method of credit
old central banking policies.,;
over
.
article in
the
August issue of the "Midland
tem
Reviewpublished by
the Midland Bank, one of the
five great joint stock banks
dom
is
to
have
on
policy
monetary
veyed,
and,
as
is sur¬
concluding
a
Jcomment, it is noted,
basis of
the
on
the study, thus far it
is still unsettled whether this
method of credit regula-
hew
'Jtion
can
be said to have pri¬
ority over the older method
of general banking credit con¬
trol through central banking
operations.
'According
the
to
the
that
August,
needs
to
be
bring that account up
date, is to be found in a note
to
of the issue of May,
17
page
1951.
sterling area, per¬
haps the most detailed selective
in the rec¬
of
ords
postwar banking in Aus¬
There, moreover, the sys¬
tem has a statutory basis, within
tralia.
the
limits of Com¬
constitutional
legislation.
monwealth
In
prac¬
article:
adopt
plants, lo¬
Conn., have
been sold by J. P. Stevens & Co.
to Shepard Irrigation Equipment
Co. of Ellington. Earlier this year
the Saxony Mills plant was also
cated
sold.
at
Rockville,
«
a
Payments will be
purchase plan.
the
made
at
share
per
of
rate
*
*
1951
for
at
cents
a
will
capital.
*
Light Co. has
Electric
Hartford
called
36
Proceeds
month.
be used for working
*
*
employees at 14 under a stock
to
-
,
said that banks
The Whitney Chain division of
cautious attitude Whitney-Hansen
Industries
has
them,
non-essential
incur
All
rather
overdrafts
reduce
to
advances
than
expenditure.
should
banks
tomers'
review
cus¬
periodically
to
that
they Were not exces¬
sive and that they were being used
ensure
for the
which
for
purposes
originally
been
had
they
the
control is to be found
different
of
score
a
Connecticut Brevities
The Hockanum Mills
payment
Sept.. 1,
on
and interest $105,000
par
1941 series
towards advances for enterprises obtained a certificate of necessity
due Sept. 1, 1971.
There will re¬
of doubtful economic value or in¬ to
build
a
plant in Long view, main
outstanding $3,150,000 of this
volving a high degree of risk. Texas. The new building, which
issue.
Agricultural producers should be will be ready for operation in
strongly influenced by the banks about 18 months, will be a oneFafnir
only
Australia
Within
tice, however, the application of
the policy to individual cases is left
chiefly to the judgment of the
6f
text
since this was
in
All
issue.
1950
credit in various countries that
.
necessary,
described
fully
added,
of
,
operating in the United King¬
of Great Britain, the history
of selective controls of bank
adopted this instrument
should
No account of the sys¬
inclusive.
Bank
than
nouncing
to be all-
article does not pretend
to
licly at the time of issue appeared
in May 1949. The Governor of the
Commonwealth
Bank,
in
an¬
selective
leading
a
likely
be
or
excess,
categories of advances being spe¬
cifically mentioned. The first in¬
structions to be made known pub¬
Sweden, France and the United States.
have not indicated advantages of this
In
to
more
August issue of "Midland Bank Review," publication of the
Midland
would
or
ultimately un¬
economic production. The instruc¬
tions " were
unusually
detailed,
lead
Thursday, August 16, 1951
.
.
.
ap¬
proved. Advances for the finance
of
should
industrial
companies should, wherever pos¬
sible, obtain their capital require¬
ments from non-banking sources.
The broad objectives of further
instructions, issued in November
hire-purchase
be
not
trading
expanded,
and
of its 3V4% debentures,
square
for the location of
plant is to be near the
"growing markets in petroleum,
primary
the
reason
new
mining
tries,"
all
chains
the
of
users
agricultural
of which are
to
meet
to
be
will
Production
there.
used
indus¬
heavy
and
cates
fense
amounting
duction
will be no re¬
present Hartford
operations.
'.v;; «
*
*
VYY: v/..V
'
-t
❖
1%
new
.V'-' b
Y".'.
;
;
which at
time in the future
some
the site of a new home
be
may
are
an¬
West
in
tract
60-acre
purchased a
Hartford
has
Company
ance
office building.
'
Btgelow-Sanford Carpet Co.
for
The Phoenix Mutual Life Insur¬
government needs
military ap¬
the
$7,999,405
of
spent
be
manufacturing facilities.
be
There
in
85%
to
will
which
for aircraft and other
plications.
an¬
receipt of two certifi¬
of necessity from the De¬
Production Administration
nounced
made
also
has
Co.
Bearing
plant with about 250,000
feet of floor space.
The
story
At this time there
to
plans
no
the
from
move
1950, were to reduce the depen¬ nounced that it plans to acquire present location.
dence of industry, agriculture and the assets and business of its sub¬
sidiary, Hartford Rayon Corp. At
commerce on bank finance, by in¬
present
time the company
fluencing borrowers to seek ac¬ the
,
Henry B. Warner Back
At Trading Desk
commercial banks. The system in
Historically, the classical instru¬
commodation outside the banking owns about 51% of the common
of monetary policy i have Australia, while evidently related
stock. The contemplated plan pro¬
to the general regulation of the
system, Finance for capital ex¬
consisted in the regulation by the
vides for redemption of the pre¬
use
of capital resources, has not
penditure and also for permanent
central bank of the quantitative
ferred on Oct. 1, and an exchange
been so closely bound up as in the
non-fluctuating working require¬
capacity of the banking system to
United Kingdom with the control ments should be obtained from of each 6 to 7 shares of common
renew or extend
credit and the
for one share of Bigelow-Sanford.
of capital issues and other forms
non-banking sources, leaving only
bringing about of changes, appro¬
On Aug. 3 when the plan was an¬
of long-term borrowing. For one
fluctuating working requirements
priate to current conditions, in the
rates of interest charged on vari¬ thing, the legislation upon which to be provided by bank overdraft. nounced, the common of Hartford
it rests is separate, and, as an ex¬ This
ous forms of credit. Other instru¬
policy was to apply to exist¬ Rayon was 4 and that of Bigelow
18%.
ments have come into use within ample of divergence, it may be ing as well as to new advances,
rioted that the regulation of bank but would be modified where a
the past two decades, among them
For the first six months of the
advances has been continuous for
deficiency in the output of the
official supervision, of the pur¬
nearly a decade, whereas control enterprise concerned was retard¬ year the net premiums written by
poses for which credit may be
the Aetna (Fire) Insurance Group
of capital issues is exercised under
extended.
''Selective" control of
ing production over a wide range
amounted
to
nearly $63,000,000,
bank credit has been widely re¬ "emergency'powers and was en¬ of industries or* in the field' of
an
increase
of
17.5%
over
the
during almost housing or primary production.
sorted to duriiig and since the tirely suspended
ments
.
second world war, as
older instru¬
policy have been deemed
unsuitable for the unprecedented
ments of.
■■■0/
conditions of the time.
whole of
the
The
1950.
first six months of 1950.
;
The
concerning bank
credit begins in November 1941,
when war-time regulations, under
the
story
National
Act, pro¬
trol tends to be associated with vided that advances made by the
the pursuance by the monetary trading banks should conform to
^
Ordinarily, selective credit
authority
money."
of
con¬
of "cheap
entirely natu¬
policy
a
This is
an
ral^association; for; when the vol¬
ume
of desired investment is out¬
policy laid down by the Com¬
monwealth Bank. In general, bank
accommodation
manufacturers
retailers
to
civilian
of
and
goods
savings, was limited, and advances for new
investment were to be granted
has to be
combated either by allowing or only for purposes essential to the
war effort; advances made to as¬
provoking an all-round rise in in¬
terest rates or by some direct sist primary production were not
stripping
the
inflationary
'
the
Security
of
flow
pressure
banks
left
are
to
interpret
policy by the application of their
judgment of
own
plications,
referred
individual
doubtful
to
the
ap¬
being
cases
Commonwealth
Having
cir¬
differences
of banking structure and methods,
it would not be expected that the
Operation of selective credit con¬
regard
to
varying
cumstances, including
trol would follow exactly the same
lines in all countries. The control
rest on
may
informal agreement
not be made
by banks," it was not authorized
"to make any determination or to
give any directions with respect
to
an
advance
made,
or proposed
particular per¬
to be made, to any
son." It should be borne in mind,
in
noting these arrangements, that
Commonwealth Bank, besides
the
specific legislation, and be
exercised through the application
*of
broadly - stated principles or
being the central institution, also
-close
with the trading banks.
or
on
observance
of
extensive
an
schedule of instructions.
The
consider whether the class of ad¬
is in fact inconsistent with
vance
national policy. In such cases the
name of the applicant need not be
conducts
Not
au¬
large
a
business
banking
all
the
in
commercial
competition
lending
immediately
for the control may
responsible
Amendment
be
a govern¬
of advances have
ment department,
public, but
or
from
the central bank
specially constituted body.
The widespread resort to selec¬
a
tive credit control makes it worth
while to put on record
of the measures
an
outline
adopted in
coun¬
tries differing widely in economic
background,
and
ods.
monetary
banking structure and meth¬
They include—to point the
diversity— the
France,
but
conditions
the
United
Canada
record
and
States,
Australia;
contained in this
the
result
of
windstorm
severe
northeast
in
Henry B. Warner
November,
000
31/2%
1957.
ket
of
debentures due July
B. Warner,
the
of
of
1947
placed mainly
of
the
the
on
the
war
until
emphasis
was
the reconversion
industry to peace-time produc¬
tion and the expansion of the out¬
put of essential goods. At the lat¬
ter
date
new
instructions
were
issued, emphasizing the dangers of
inflation and stating that banks
should
not
provide
finance
for
f<3r new enter¬
prises where production was not
capital purposes,
or
purpose
Act
1950
1,
powers
central
of
credit
bank.
control
Yale & Towne's semi-annual
practice, as
in Australia, the policy is admin¬
istered by the Reserve Bank with
cooperation
the
of
•
Robert D. DeMuth Is
With Ball,
Surge
i;
re¬
has
associated
port reveals an increase in sales
for the period to $46,500,000 from
DeMuth
$29,000,000 a
ings on the
year
land, members of the New York
and Midwest Stock Exchanges. He
of
June
orders
on
$42,000,000.
Now Bay
received by the
were
and
materials
handling
*
its
recent
6,
t'f
%
Company
PROVIDENCE,
divisions in the second quarter.
In
formerly with Otis & Co. and
was
John Nuveen & Co.
about
was
Cleve¬
Several large govern¬
ment orders
hardware
30
become
with Ball, Burge & Kraus,
earlier. Earn¬
common
improved
from $1.93 to $2.90. The backlog
the'
1951,
R. L—On
name
of
informs
the
trading
over
offering Building,
The
sold
remaining 2,207 shares
to
a
Frederick S. Gordon
of security
group
Frederick S. Gordon, partner in
dealers.
*
*
..
Pitney-Bowes,
'•
is
Inc.
Colgate Hoyt & Co., New York
City, passed away at the age of
offering
64
9,370 shares of its common stock
after
a
long illness.
■We maintain primary markets in:
CONNECTICUT
CONNECTICUT
doubtful
cases,
and
all
LIGHT
CONNECTICUT
HARTFORD
fer to the Reserve Bank marginal
or
SECURITIES
on
..
POWER
POWER
LIGHT
memoranda
these -and
other
UNITED
•
NEW
•
ELECTRIC
Descriptive
cases
&
HAVEN
•
desirable
that
individual
available
Connecticut
Bank,
that
bank
the
provided
concerned
in order to
safeguard
Continued,
on
companies.
MEMBERS
NEW
YORK
STOCK
EXCHANGE
pre¬
NEW
pared to grant the advance. Here
again,
GAS
request
CHAS. W. SCRANTON & CO.
always
is
on
LIGHT
con¬
sideration should be given by the
Reserve
ILLUMINATING
GAS
HARTFORD
where special circumstances make
it
page
the
30
W.
was
99% of the 400,000 shares of¬
fered.
were
common
banks of the requirements of cur¬
policy, and the trading banks
voluntarily conform to the$e re¬
quirements. The trading banks re¬
Aug.
Arnold
Jones & Co., Inc., Hospital Trust
changed to Bay
Southern New England Telephone Company.
There are no other
Co.
received
subscriptions
for changes in officers or business.
trading
rent
-
CINCINNATI, Ohio—Robert D.
banks. From time to time the Re¬
Bank
of
illness
an
(Special to The Financial Chronicle)
to
In
after
desk
weeks.
several
stock.
common
of
gives gen¬
con¬
been made
it is understood that
end
November
on
for the
Street, has returned to the
Broad
trading
plans to mar¬
additional $300,000
an
President of Henry B.
&
Co., Inc., 123 South
Warner
The company
publicly
Pa. —Henry
PHILADELPHIA,
Including 40% credit for in¬
*
eral
the
the
instructions
Commonwealth Bank
trol
money
controlling the general policy of
that person or class of persons in
relation to the making, renewal,
and increasing of advances." This
regulation remains the basis of
control, though the Reserve Bank
serve
thority
in
to
a
as
claims from the
1950.
47.4%
affected
advances may or may
*
largely
51.7%,
The loss
from
On the other hand, a dis¬ crease
in
unearned
premiums,
appointed customer has a right of earnings for the first six months
appeal. An applicant whose pro¬ were about $2.65.
posal has been declined as being
inconsistent with current policy
Derby Gas & Electric Corp. has
may ask the banker to submit it
to
the Commonwealth Bank to placed privately an issue of $900,-
,
productive capacity.
increased
Bank.
by the regulation. Con¬ disclosed.
of credit. Consequently the selec¬ trol of bank lending was put into
New Zealand
permanent form in the Banking
tive control of credit tended to
Less formal than the Australian
Act 1945, which gave the Com¬
develop first in countries whose
is the system developed in New
governments sought to maintain monwealth Bank statutory power
Zealand.
It
was
introduced
by
to "determine the policy in rela¬
a definite order of priority in the
13 of the Finance
advances to be followed Regulation
use of capital resources, while it tion to
by banks" and provided also that Emergency Regulations 1940 (No.
was fostered by the desire to mini¬
mize the interest burden of public "each bank shall follow the policy 2), issued In June 1940 and em¬
determined."
Although the powering the Minister of Finance
and
semi-public
debts.
Subse¬ so
to give directions "to any person
quently it has been adopted as an Commonwealth Bank was em¬
or
class of persons for the time
extra defense against inflation in powered to "give directions as to
conditions ot severe pressure upon the classes of purposes for which being carrying on the business of
action to restrain the effective use
ratio
New
York:
REctor
HAVEN
2-9377
Telephone 6-0171
Teletype: NH 194
~
Hartford 7-26G9
Volume 174
Number 5038
.The Commercial and Financial Chronicle
.
.
lending
do not
inclined to the view that
Factors in Sound Self-Liquidating
Bank and Insurance Stocks
E E;
By
institutions
look
College Housing Projects
JOHNSON
This Week—Insurance Stocks
alty and Surety," published by Alfred M. Best Co., 75 Fulton
Street, New York, N. Y., was recently released for distribution.
Recognized as a leading authority in all fields of insurance,
"Best's Insurance Reports" are valuable sources of current infor¬
The 1951-1952 Casualty and Surety Edition, provides a com¬
prehensive review and analysis of the operating results and finan¬
cial condition of all
domestic and foreign
tympanies transacting
casualty and surety business in the United States.
addition
In
a
review of each individual company which
history, management, underwriting and invest¬
ment policies, exhibits on underwriting and investment results,
comparison of operating figures and a summary of stocks and
bonds owned, the publication contains a discussion of the signifi¬
cant developments and changes in the casualty and surety busi¬
ness during the past several years.
While the individual comparisons of companies are very use¬
ful in determining the operating results of a particular company,
the general comments made about the casualty business are par¬
to
includes details
It
1943
1944
the
of
_____
self-
1947
____
1949
tant
place in establishing
credit
It
for
structure
such times
a
financing is needed.
as
would
sound
college at
appear
rate record
that
necessary
have and maintain
you
a
accu¬
an
showing the history of
enrollment in your schools.
Ratio
Ratio
wise there should be
39.1%
91.8%
future
51.1
40.1
91.2
you
53.3
39,0
92.3
enrollment.
have made
forecast of
a
How
of
many
and
women
*58.1
36.3
*94.4
fraternities, sororities,
*56.6
35.6
*92.2
*55.7
36.1
*91.8
tives, private rooms and students
living at home.
*60.0
35.7
*95.7
living
in
To assist in
incurred
expenses
premiums
written.
to
*Case
premiums
you,
men
residence
halls,
years
important
,
sharply reversed in 1950 and the com¬
ratio advanced by more than four points.
this change was the fact that three of
experienced
were
on
trends
unfavorable
in
number of these lines.
a
determining present
according to Best's compilation, the stock casu¬
alty companies wrote nearly $1 billion of automobile liability and
property damage insurance in 1950 on which they reported a
over
While most carriers reported
the first half
$12 million.
favorable experience
a
on
these
the year,
of
which
is
for both
course
The
studies
colleges with whom I have worked
have been of the opinion that some
the information which I
of
asked
with
similar unprof¬
a
Recent- prompt and substantial rate increases,
a better balance into these lines.
however, should bring
Another class of insurance which showed a
ratio
was
workmen's
compensation.
sharp increase in
V/hile the line
re¬
mained in the black for the year,
average expense
The combined
ratio,
ratio
it was only by reason of a low
the loss ratio increased by nine points.
as
was
98.7%.
As with
the automobile
lines, rising costs, in this instance medical and hospital,
of the main
The
reasons
other
unfavorable
insurance
showing
This line
costs.
There-
for the
are
was
liability
were one
unsatisfactory results.
classification
also
which
affected
many
contributed
to
the
by
other details and information about casualty
operations in the current edition of "Best's Insurance Reports."
is
essential
an
source
It
book of information for people interested in
casualty insurance stocks.
compared
as
nities, sororities, cooperatives, pri¬
vate rooms,
and students living
,at
home.
have
I
insurance
found
companies,
the
that
and
banks
investment bankers who have been
interested
in
bonds
residence
hall
rev¬
vitally interested
in knowing the facts which will
determine whether a college is
enue
are
facilities
are
insofar
know,
there will be
the
for
are
the
a
that
demand at all times
facilities
housing
feel
to
and
possible,
as
Hammond Adds Many
To Staff
(Special to The Financial Chronicle)
LONG
BEACH,
Calif.
—
Albert
Baker, Nelson D. Bark, Sidney L.
Fred S. Cutter, Jesse D.
Duke, Oral C. Fillinger, Loyal D.
Cagan,
Gifford, H. A. Homeyer, E. Regi¬
nald Hotopp, Gordon L. Hudson,
Max Jonas, John F. McCaffery,
M.
L.
McGaughy,
John
David
Marshall, Lawrence S. O'Reilly,
Charles L. Robinson, Alfred Sam¬
uels, Woodrow W. Smith, John R.
Stewart, H. Nolan Stout, Edward
E.
Strickler,
berg,
Arthur
Russell
J.
S.
Vanden-
Vonderheide,
Everett L. Walker, Cliff Weingart,
BANK
and
INSURANCE
John
and
H.
Winn
with
associated
that
at
no
which
are
all
now
time
should
housing facilities of the college
ment for
Douglas A. Ham¬
mond, 5327 Lakewood Boulevard.
and 65% to 70% for
men
women.
It is always
helpful in placing
loan to have available
revenue
accurate
a
an
history of the past resi¬
program.
This should
hall
dence
include
record
a
all
of
existing
capacity, original cost,
both total and per student, current
facilities,
appraised
value,
original
debt,
total and per
student, and current
debt, total and per student. Im¬
portant to
a
the
record
well
who is lending funds
one
for
With Highland Securities
Members New York Stock Exchange
Members New York Curb Exchange
120 BROADWAY, NEW YORK 5, N. Y.
Telephone: BArclay 7-3500
Bell
Teletype—NY 1-1248-49
(L. A. Gibbs, Manager Trading Dept.)
Specialists in Bank Stock*
WALNUT
Robert
•
Pittman
with
Foley
J.
CREEK,
Foley
have
and
become
Calif.
George
prqject
is
retirement
as
self-liquidating
as
a
of
debt
forecast of debt retire¬
H.
affiliated
previously with Kaiser
& Co. Mr. Pittman
dell & Reed, Inc.
was
which
with Wad-
will
required
retire the outstanding debt in
years
full.
—-
Highland Securities Co. Mr.
was
of
to
(Special to The Financial Chronicle)
Laird, Bissell & Meeds
have
and
a
new
;/
Statistical
Statistical
shows
the
earnings of
,
be
of
any
or
address
in
revenue
an
to support the
to construct and
residence hall. We
new
a
could reach
point of diminishing
attending
a
return. With all costs of
definite
points which I have raised,
while the completeness of the in¬
formation and the form in which
these
presented will also be deter¬
it is
mining factors in securing a loan.
record
of
all residence
possibility
conservative and avoid difficulties
in
meeting
ning the importance of residence
hall
management.
When
one
realizes that the only security that
a
institution
lending
or
investor
payment of interest and
has for the
principal is the net revenue from
the
operation of the residence
halls, it is not difficult to under¬
stand the importance of efficient
management. You
people here, in your respective
positions, will determine to a very
great extent the terms and condi¬
profitable
and
future
for
tions
institutions.
respective
your
borrowings
for
You
building, year by year, a his¬
mine
part of your governing boards to
undertake
additional
self-liqu|i-
and
projects
dating
second,
the
decision of the lending institution
investor to make you the loans
required. It is important that you
have a complete understanding of
management problems as well
the services which you are re¬
as
quired to furnish in the successful
of
operation
houses.
I
vision
speak of services
When I
room,
of
of just board
not
but also of the super¬
residence hall students,
social arid recrea¬
the educational,
tional
residence
your
thinking
am
and
programs
carried
as
on
a
part of the services of residence
and the cost there¬
of. Successful residence hall re¬
hall operations
are
not
solely
the
furnish¬
ing of board and room to men and
women students of your colleges.
To
re¬
few further ob¬
are a
servations
•
which, in my opinion,
determining.factors of a sound
are
self-liquidating program:
No
self-liquidating project
should be started, or bonds issued,
payable from the
revenue
unless there is definite
thereof
assurance
that adequate funds will be avail¬
complete the project,
in¬
furnishings and equip¬
with some assurance that
project
will
be
completed
ment,
the
within
a
specified time. An un¬
completed self-liquidating project
is poor security for a loan. Funds
must be
provided to meet interest
requirements during construction.
Margin of Earnings Over Charges
The
be
amount
limited
retired,
to
of the debt should
a
that
sum
can
be
with
interest, out of the
conservatively estimated earnings
with
in
adequate margin of safety
an
case
estimated earnings are not
realized.
When
for
service
debt
ahead
suitable
have
reserves
been
pro¬
of
time, the excess
and the re¬
margin of earnings over debt serv¬
you accomplish will deter¬
ice need not be as large as where
first, the decision on the
sults
the
loan
-i\
Following
vided
of management
tory
or
annual
the
quirements.
cluding
in the very begin¬
mentioned
I
will
we
fact, you probably have
already seen instances of this
happen. It is, therefore, important
so far as setting up
estimates to
support new loans, that we be
able to
Importance of Management
that
cation. In
is
sults
information which
by Mr. Cress be¬
fore the Third Annual National College
Housing Conference Michigan State Col¬
lege, East Lansing, Mich., Aug. 3, 1951.
an
net
necessary
required
equip
which
room
afford to pay in order
produce
loan
tional program; what are its plant
facilities other than housing; what
fully
program
♦Part
/and
can
amount
resi¬
.
Information
historical
board
to
what is the educa¬
for the college;
are many
ment which will show the number
STOCKS
for
Nevertheless, from the
dence hall.
are
college owned. There
who
housing
so far as
concerned
exceed 50% of the normal enroll¬
■
unimportant
was
rowing of funds for
centage
owned residence halls
housing because of
rapid
students
various periods of years is always
to
printing your future program for
housing.
No forecast of future
needs, however, would be com¬
plete without adopting a general
policy with respect to the per¬
over-building
the impact of rising
the other liability class of insurance.
was
for additional
closely related to the bor¬
helpful. Terms and conditions 6f
the loan are influenced by all of
referred
with those to be housed in frater¬
loss
for
not too
women.
and
men
have
I
and
the year into losses.
experience.
struction. There has been pressure
refunding or
increase in enroll¬
I know that at times some of ments. This
brings with it the dan¬
the administrative officers of the
ger of over-estimating the rates
of
students,
men
and
women, to be housed in college-
1951
for
construction.
of
unsatisfactory,
sharply rising claim costs re¬
sulting from changing economic conditions and inflation, particularly in the last quarter, changed the profits of the early part of
These same trends continued into
new
the experience, character and
standing of the administrative of¬
existing housing which will ficers and teaching staff? Informa¬
analyze your housing facilities on tion showing the sources of cur¬
the basis of that which is satisfac¬
rent financial support and sched¬
tory, that which is fair and that ules of operational reports for
will, I think, be helpful in blue¬
For example,
statutory underwriting loss of
problems arising during
past several years through
continuing rising costs of opera¬
tion as well as rising costs of con¬
the
of
was
underwriting lines showed
about the
your
coopera¬
future needs it is my judg¬
ment that there should be a chart
written.
basis.
either
funds
of
'
few words
cannot afford the cost of an edu¬
*98.9
adjustment
I should like to say a
What is the administration plan
37.7
to
Problems of Higher Costs
room
have fewer students because they
*61.2
loss
the basis of room rev¬
on
board revenue,
school having risen to their pres¬
ent level we can consider the very
*94.1
the last half of the year with the result that statutory underwrit¬
t the
demands that such a pol¬
icy be followed.
ing to the history and operation of
the college Ire important.
90.8
36.1
Part of the reason for
itable
in your
lege, the following facts pertain¬
37.0
bined loss and expense
in
year. These costs are proper*
charges and I support all of you
sta¬
and
53.8
The favorable underwriting trend which had prevailed in the
previous three
lines
to
point of view of establishing the
highest credit standing for the col¬
men
and
ing losses
buildings must
your
properly maintained from yeaf
of exist¬
and
survey
a
Like¬
*58.0
^Expenses incurred
the
be
yourselves as well as for those
are considering the loaning
for
for
impor¬
an
ing housing facilities for
women which will
give
tistically, the number of
1950
^Losses
that
lender,
tial information to have available
ing this need also have
1,324,890,000
1,613,831,000
2,075,011,000
2,442,237,000
2,-363,540,000
1946
—__
institution, and those who live in
residence halls, as well as
from the point of view of the
the
who
52.7%
$997,395,000
;/•■■•/ 1,110,089,000
1,129,602,000
1,223,283,000
1945
1948
Ratio
management
2,933,019,000
_____
policy of maintenance and re¬
placement
of
furnishings
and
equipment. It goes without saying
that from the point of view of the
-"'.'VA
/
labor
cost, board labor cost, other ex¬
penses and net revenue, is essen¬
needs for housing.
Those factors
which have a bearing on determin¬
Combined
Written
1942
^Expense
enue,
liquidating program should, at all
times, have in front of them a
blueprint of the present and future
following figures taken from the current edition of "Best's
■^Insurance Reports, Casualty and Surety," summarizes the operat¬
ing returns of the stock casualty and surety business lor the past
ten years.
■-v/V
/' / '/
rJLoss
halls,
are
cessful
The
Net Premiums
to me that people
responsible for the suc¬
appears
who
perspective with the experience of previous periods.
1941
:
on
ticularly interesting. They analyze the reasons for the unfavorable
underwriting experience of last year and put this information in
>
a
these funds.
I should like to mention, briefly,
Discussing the financing of college housing projects through
self-liquidating loans, Mr. Cress points out factors which should
be adhered to in planning and promoting such financing.
Among these factors are: (1) an accurate history and forecast
of resident hall operations; (2) statistical information regard¬
ing revenues and costs; (3) administration and educational
program of the college;
(4) sound management; and (5)
definite assurance of adequate funds to complete project.
mation ?md operating records of insurance companies.
the use of a resi¬
place for eating
when they loan you
on
hall as
arid sleeping
the
President, Ann Arbor Trust Co.
-Ann'Arbor,.Mich.
The 38th annual edition of "Best's Insurance Reports, Casu¬
investors
or
solely
dence
By EARL H. CRESS*
;
13
(605)
there
a
residence hall
I
are
no
reserves
they
are
ture
earnings. In
adequate
where
or
to be created out of fu¬
the
absence
of
the
investing
public expects earnings of at least
1 Yz
times the debt service re¬
reserves
quirements. When there
reserves
duced
to
the
margin
around
1*4
such
are
may
be
times
re¬
earn¬
ings.
In
determining the length of
maturity of a proposed self-liqui¬
dating
revenue
bond
issue,
the
the
improvement
applied to college
and university loans. True, when
properly maintained the buildings
should last indefinitely but col¬
leges are not operated for profit
and the incurrence of any debt at
all is a comparatively modern .de¬
theory that it
may
extend
over
estimated life of the
should
not
be
a present day emer¬
that cannot readily be fi¬
vice, to meet
gency
nanced otherwise.
The shorter the
it is my judgment that maturity the sooner the debt will
be a proper balance be reduced. In states where it is
all
of
these
services
Continued on page 31
must
between
which
justify
there
have
mentioned.
I
am
14
The Commercial and Financial Chronicle
(606)
Urges Federal Indemnification of War Damage
George C. Johnson, President of Dime Savings Bank, Brooklyn,
t
in
strides
mous
World
War
vealed
in
since
the
end
II. This has
the
annual
been
of
this
assured
two
future
tungsten
other
possibilities in the Dominion
Canadian
are
being assessed. Up in the famed
Porcupine district of Ontario the
wealthy
Hollinger - Consolidated
Gold Mines has been giving seri¬
ous
consideration
to
resuming
Book,
the
1951
edition
which has appeared recently. The
contained therein shows the
'.already big Canadian mining in¬
production of Scheelite.
Back in World War II, the Hol¬
thriving in
the greatest period of expansion linger interests recovered Schee¬
in their history. Many new rec¬ lite (tungsten) from its gold oper¬
dustry has grown bigger and the
mining companies
of
ords
mineral
are
output,
ations
compris¬
this
and
with
man
'
Prompt: passage of legislation
lines
so
broad
that
all
primarily
along
Dime
homes, commercial structures and
originates
practise
may
ing copper, iron, lead, nickel, oil, once again adopted if special
lilver, sulphur, uranium, zinc and celerated depreciation rates
other
essential
metals,
are
in awarded by Ottawa.
be
ac¬
are
An experienced
mining group
offing.
One important metal, tungsten, has taken On a tungsten property
jlot yet produced in considerable in the Stewart Creek district of
the
quantities in Canada, British Columbia for an extensive
to be offered to the development program. Considera¬
the next few
months tion may be given to conducting
commercial
other
facilities
States
and
p o
in
the
United
V"v.-:-"'-r..
its
World War II by his
mortgagee to take out war dam¬
indem¬
nified
of
case
out
payment
by
C.
Johnson,
The
of
Dime
Savings
'
"Furthermore, there is the para¬
of
dox
World
War
George c. Johnson
Bank
industry and de¬
remain in vital
urging
workers to
production areas and re¬
defense
their
pay prohibitive
for protection of
to
rate
insurance
plants,
lives.
and
homes
Those civilians who are most ex¬
% the War
provide real estate in¬
demnity for losses incurred by
enemy action within the United
States and its possessions.
Basi¬
cally, it was a giant insurance
company. Nominal premiums of
$l-per-$l,000 were paid by prop¬
erty owners who desired to be in¬
sured against loss.
ernment to
premiums, has
President
fields, Mr. Johnson
:
Damage Corporation was formed
as a branch of the Federal
Gov¬
insurance
George
'
'"In
war
been urged
mortgages than any
insurance.
age
quiring them
in
damage, with¬
of
indi¬
more
fense
said:
Gov¬
ernment
home
and insurance
the
by
Federal
holds
and
The
of Brooklyn
stand, following consultation with
numerous
leaders in the banking
automat¬
ically
vidual
because
Bank
mortgage who was re¬
a
in
other savings bank in the country.
In
a
statement
explaining
his
ssessions
are
interested
Savings
free
titled to as
war.
*
these
of
sources
re¬
Mines
data
/
of
end
by
production
month.
Besides
arising out of
.
quired
'
with the paper and
industries, the Canadian
mining industry has taken enor¬
^
individual owning
and clear is en¬
much protection as the
the
property
legislation assuring monetary payment for civilian losses
urges
By WILLIAM J. McKAY i
Along
ticularly since industry has been
decentralized the way it has been.
"Also,
Canadian Securities
power
Thursday, August 16, 1951
•
.
.
posed
of
hazards
to
ac¬
enemy
tion should not be
sume
required to as¬
undue share of the bur¬
an
of protection.
den
This should be
shared
equally
by every person
in the nation just the same as any
other cost of war is shared.
J
"Protection of
our
national
war.
in
purpose
mary
civilians and
our
economy
What do
our
is the pri¬
fighting
a
gain by winning
we
a war on the
battlefield, and yet
"The theory was that the pre¬
lose that war in our civilian es¬
the
miums collected would create a tablishment?
world
in
problem—and it is an immediate
fund sufficient to meet any antici¬
to alleviate the shortage
in the additional work on the Clubine
"Suggestions have been made
problem—is for the United States
Western World, if the results ex¬ tungsten
property in the same
pated losses. During its existence,
Government
to
provide blanket
during Congressional hearings on
the War Damage Corporation col¬
pected from the rate of progress province which at one time was
various war damage bills that the
indemnity for all war damage to
lected a total of $256,000,000 in
of two Canadian tungsten prop¬ under Consolidated Mining &
Federal government assume liabil¬
property here at home, and, after
erties are realized.
Smelting Co. direction.
premiums. As we all know, dam¬
the amount of any loss becomes
ity for war damage and levy, a
Panaminas
Inc., an American
age
by enemy action after the
The
Canadian Government's
known, to equitably distribute the
general tax to defray the actual
by Toronto
corporation
was
formed
was
wartime tungsten producer, closed company controlled
cost
over
the
entire
economy.
cost of any claims arising due to
negligible and very little was paid
is resampling
the old
since January, 1949, located high capital,
Congress should delay no further
enemy action, AFTER such losses
Adamson tungsten mine, adjoining
out
in claims.
The $210,000,0,00
atop
the mountains in
British
in passing a
practical, workable
occur.
United
States
Vanadium
Corp's.
remaining after claim adjustment
Columbia, is scheduled to be back
law and putting it into effect im¬
"Within the insurance industry
and
administrative expense was
tungsten producer in California.
in
production
by
October.
At
mediately," said Mr. Johnson.
turned over to the United States itself, organization already exists
According to the Canadian
present the 250-tori mill is under
The banker praised recent pro¬
Mines Book, the total number of
capable of handling war damage
Treasury.
construction at the Emerald mine,
posals to this effect made by the
claims. If and when losses due to
located at Salmo, about 10 miles producing mines in Canada is now Bureau of the
"There is a tremendous differ¬
Budget before a
enemy
action occur, some pro¬
north of Pend Oreille Mines & 159, up from 149 a year ago. They Senate subcommittee headed
ence, however, between the situa¬
by
cedure could be followed, such as
include 82 slraight gold mines, 45
Metals Co. in Washington.
Senator J. Allen Frear, Jr. (Dem., tion in World War II and now.
base
metal
setting up a valuation commission
producers,
and
32
Because
of
the
development of
The old gold mill of Tungsten
Del.).
'
: '
of
local
insurance
composed
others, not counting coal. More
new weapons
such as the atomic
Corp. of Canada is being revamp¬
"Protection of our civilians and
brokers and agents in each com¬
than 300 other companies are ac¬
bomb and guided missiles, the po¬
ed to start turning out tungsten
the national economy is our pri¬
tive
in exploration or
develop¬
tential war damage to our civil¬ munity to pass upon the claims,
at
Outpost Island, Great Slave ment.
mary purpose in fighting a war,"
ians and civilian economy is so compile necessary information and
Xake district, Northwest Terri¬
New mining incorporations since Mr. Johnson said. "War knows no
handle the required forms for. a
tories. The mill is expected to be
great and so impossible of deter¬
mid-1950 total 175, while 90 com¬ boundaries in this atomic age and
nominal fee. Here
again, the Bu¬
mination today that no plan such
a
civilian and his property are
reau of the Budget wisely recog¬
panies have been revived to start
as followed
by the War Damage
almost as subject to loss as a sol¬
new
nizes there is machinery at hand,
programs of work. In
the
dier in the field. Therefore, mone¬ Corporation in World War II will
previous year there were 218 new
provide sufficient premium
in¬ having told the Frear subcom¬
mittee that existing administra¬
companies and more than 100 re¬ tary payment for civilian losses is come to meet
potential losses.
tive
vivals, the decline in these totals just as much a part of a war's cost
organizations
and
systems
CANADIAN BONDS
as munitions
and maintenance of
;"The Bureau of the Budget •should be
being attributable to the lessened
i^sed to the fullest
the military establishment.
wisely recognizes this fact.
The
interest in prospecting for gold.
extent possible so as
to reduce
Assistant Director of the Bureau
Government
"For this reason," he continued,
Further discoveries of important
costs, preserve flexibility and con¬
has told a Senate subcommittee
mineral
deposits have
recently "in case it is necessary, every per¬
serve manpower.
Provincial
that if insurance premiums were
been announced in Quebec Prov¬ son in the nation should contrib¬
"Conservation of manpower is
held low enough to be attractive,
ince.
Municipal •
Mr. Duplessis, Premier of ute to the cost of protecting civil¬
especially important in the over¬
the Province, in a news con¬ ian life and property should losses they might not cover losses, and
if they were set sufficiently high all aspects of war damage indem¬
Corporation
ference on Aug. 3, stated that the occur the same as they contrib¬
A preliminary estimate
to accumulate a substantial fund nification.
uted to the military cost of the
Labrador
Quebec
Development
indicates
that
the
personnel in
old-fashioned war in its limited they might be prohibitive.
Company Limited has reported a
the insurance department of every
rich
"In World War II, participation
iron
battle zone.
discovery
170
miles
Furthermore, by a
mortgage lending institution .in
northwest of vast iron deposits blanket
damage insurance was
type of indemnity, as¬ in. war
the
country would have to be
blocked
out
in Ungava
by the sumed by the Federal Govern¬ largely voluntary, although mort¬
is
expected
of Brooklyn.
"The
only
real
solution
to
-
.
(
-
CANADIAN STOCKS
Hollinger
tion
North
Shore
Explora¬
Company.
He said H. W. Darling,
President
of the Quebec Labrador Develop¬
ment Company, has plans for im¬
incorporated
Two Wall Street
New York 5,N.¥.
NY
1-1045
Fifty Congress Street
Boston O, Mass.
shafts
CANADIAN
INDUSTRIAL
WESTERN OILS
MINING
SECURITIES
Inquiries Invited
without payment of insur¬
premiums, untold millions of
man-hours
dollars
and
would
to
work
the
610 St. James St., WM Montreal, P. Q.
.
,
Telephone Lancaster 5101
Direct Private Wire to Toronto
in
target
mortgagors
doubled
potentially
dan¬
areas
protect
to
required
properties
and
gold finds.
r
-
with
copper
hearing
a
month
Subcommittee
ago
before
the
age.
Principal
reason
war
dam¬
is that there
Securities In¬ is no actuarial experience what¬
also
announced, surance and Banking of the Sen¬ ever on which rates can be deter¬
giving details, that Bar- ate Committee on Banking and mined.
vue
Mines Limited has signed a Currency, would set up a $20,000,"Despite the low premium rates
contract for electric power sup¬ 000,000 fund and a War
Damage
plies from Quebec Hydro-Elec¬ Administration to pay compensa¬ prevailing in the plan followed
tion for damage to private prop»- during World War II, only 8,700,tricity Commission.
K
,000 policies were issued for war
He called the recent zinc dis¬ erty aftd another $2,000,000,000 for
damage to public property under damage insurance. Vast areas of
covery in Barraute Township, in
the country which believed them¬
Pro¬
Northwestern Quebec, one of the an indemnification system.
selves immune to enemy action
vision is also made in the
The
on
Premier
without
pro¬
posed
Established 1922
Members Investment Dealers Ass'n of Canada
gerous
saved
"richest in the world."
Kippen & Company, Inc.
be
lenders
gage
through avoiding the neces¬ through War Damage Corpora¬
sity of writing individual insur¬ tion insurance.
mediate development of the new ance policies.
Of even more im¬
: "There
was
no
one
to require
deposits at an estimated cost of portance to the national economy the
individual
or
firm
owning
is the fact that by an indemnifica¬
$80,000,000.
property free and clear to take
Premier Duplessis also revealed tion system, every property would
out this protection, and very few
that 1,000,000 tons of copper and be covered.
This could never be
did so. It is a fact well known by
gold ore have been located by achieved by insurance as such,
people experienced in the insur¬
because
Campbell Chibougamau Mines
experience
has
shown ance
field that the average indi¬
Limited on Merrill Island, in Dore that a relatively small proportion
vidual will not buy insurance un¬
of the public will voluntarily buy
Lake, about a half mile from
less persuaded to do so by compe¬
Chibougamau townsite.
insurance, no matter how small tent
brokers or agents or required
He let it be known that E. O. D. the premium."
to
by
mortgagees
having
that
Campbell, President of that com¬
The legislation proposed by El¬
right. In other words, insurance
pany, has informed Quebec mines mer B.
Staats, Assistant Director has to be sold and that is imprac¬
department of plans to sink mine of the Bureau of the
Budget, in a tical in connection
A. E. Ames & Co.
WORTH 4-2400
ment
ance
for
George T. Leach
War
Disaster
payment
of
Act
of
benerits
to
pendents of civilians killed iri
1951
de¬
war
paid
no
attention to the idea.
of
even
one
atomic
concentrated
area
and to civilians who sustain war-
bofnb
in
in Pasadena at the age of 61 after
a heart attack.
Mr. Leach in the
caused
would
produce
past had been
the type of thinking'during recent
months by the banking and allied
industries.
He
explained he is
George T.
Leach
passed
away
partner in A. B.
Leach & Co. and later headed his
own
a
firm, George T. Leach & Co.
injury.
r
*
•
;J
Mr. Johnson said this represents
a
-
staggering losses.
And because of long-range planes,
guided
to protect
ings
missiles and other new
weapons,
this danger confronts
every portion of the country, par¬
size if it became
nec¬
mortgaged properties.
"In the
of The
case
Dime
Sav¬
of Brooklyn with
Bank
ap¬
proximately 65,000 mortgages, this
would mean at least 27,000 more
man-hours
policies,
per
year
card-index
handle the thousands
to
prepare
records,
of endorse¬
ments
covering changes in owner¬
ship and to perform the innumer¬
able other
accounting details
with
essary
For the
sibly
as
a
five
or
whole,
million
hours per year would be
This
is
serious
a
nec¬
war
each property.
on
nation
four
individual
an
damage policy
pos¬
man-
required.
situation
in
an
already short labor market, and it
would be
economy
a
substantial loss to the
whether
damage loss
course
only
were
or
not any war
incurred. And of
the
to
foregoing figures apply
mortgaged
properties
would require to
be insured to protect themselves
against.
There
would still
be
many
millions of properties
which
lenders
owned free and clear which would
have
*"
"Today, that is all changed. The
dropping
in
to write individual policies
essary
no
protection.
"America only weakness, in re¬
lation to her potential enemies, is
lack of manpower.
must
way
conserve
Therefore, we
in every¬
manpower
possible—not waste it.
"Through blanket indemnifica¬
tion
from
the
Federal
govern¬
ment, obviating the necessity for
Number 5038
Volume 174
The Commercial and Financial
.
.
.
individual insurance policies, un¬
millions of man-hours and
dollars would be saved.
Frear
and
his
(607)" 15
Chances oi Sterling Revaluation
told
"Senator
Chronicle
com¬
Securities Salesman's Corner
By PAUL EINZIG
mittee, the Bureau of the Budget
and
all
others who
uted
to
plan
are
they
the
V
contrib¬
have
formulation
this
of
*
deserve
the
would be
,;
.-
of
support
firm
in
individual
every
nation."
the
/
and
v
'
-
============
aid in maintaining Britain's gold
reserve, since
it would lead to lower costs of imports
and, in many cases,
would not affect exports
adversely.
V •
an
Two Letters
In
ties
Denver Office
'
the
nounce
Exchanges,
establishment
a
of
Goode,
man¬
bates.
As
Ministers
Chancellor
of
.
of
"the
guarded
Chronicle)
secret
until
directed
ernment for its denials
&
in
Co., Ford Building, members of
New York
Detroit
and
Joins
•LOS
G.
Morgan & Co.
ANGELES,
Pellow
with
has
Morgan
&
pects of
Calif.—Alfred
become
Co.,
balance
Street, members of the
Los Angeles Stock Exchange. Mr.
Pellow was formerly with Hill,
-
With Waddell & Reed
land
A.
Foote,
E.
Ritsema
■■
with Wad¬
are
revalued
is
argue
that
Einzfg
dell & Reed, Inc.
government
themselves to
"
that
deterioration
of
.In
Inyestment
taining sterling at
Britain, and the
Field
a
live
-
Rockford
Securities
Association
"Fling
Dealer?
the
Mauh-Nah-Tee-See Country Club
Aug. 24, 1951
Denver
Ding"
at
(Denver, Colo.)
Bond
Club-Rocky Mt
Group I. B. A. annual frolic and
outing at the Park Hill Country
the
house
secondary necessities would suffer.
Until
of
Sept. 20, 1951 (Omaha, Neb.)
an
There
Investment
no
;
should continue to
'
Association of Stock Exchange V
Firms Fall Meeting at the Terrace-
now
no
be
longer in
advisable..
the
balance
no means
a leap
payments
of
continue
to
deteriorate,
whether
because
of
it
in
Plaza Hotel.
spite
,
Beach, Calif.)
National
change.
Traders
!
sociaiion Convention opens at Co
ronado Hotel.
»
/
'
Oct. 12, 1951
i
Dallas
umbus
Bond
Club
annual
Col
Day outing.
demands
in
result
New
York
(New York City)
Security Dealers
Association 26th annual dinner at
the Waldorf-Astoria Hotel.
task
(Hollywood
Beach, Fla.)
Investment Bankers Associatio»
Annual Convention at the Holly*
wood Beach Hotel.
the
forward
.
granted there is bound to be
vicious
spiral
the higher value
is
in
very
all of
~
B
^hrch, as you know dc,esnoitpay
However
e®s\
claim
T
^
«j
give
no
in
spite
of
a
revaluation.
of sterling would handicap
As
ex-
I think
the naSD
h0De
continue
will
you
the
matter more publicity, as
your idea is the ohly senr-
Srow-
New York Stock Exch.
Weekly Firm Changes
The New York
Stock Exchange
has announced the following firm
changes:
Interest of the late Michael M.
Beuren,
van
Often
Hall Aug.
limited
"I
don't
read
when
know
have
I
partner in
Paine, ceased
15.
bership
of
Arthur
Gaines
like yours in the
spot
icle,' in your 'Security Salesman's
Corner.'
This is
a
matter that has
With Paine, Webber
been under discussion by a few of
our
local dealers for
"It
seems
down
time.
some
sell
all
been
securities
on
a
to
commis¬
For instance, we
selling
the-counter
los
that the member firms
here instruct their men
sion basis.
(Special to The Financial
pressure
has not been rendered
have
a low-priced, oversecurity for the past
Angeles, caiif.—Josiah
Jenkins has become connected
F.
with
He
Webber, Jackson &
Spring Street.
previously with Schwa-
Paine,
Curtis,
South
626
was
bacher &
Co.
few weeks which has considerable
speculative appeal.
the customer's
•
informed
be
me
allowed
men
I asked one of
of XYZ & Co.
With A- M. Kidder
•
that he would only
to
put
a
small com-
(Special to The Financial
Fla.
sarasota,
Coloney is
now
Chronicle)
—
Paul
& Co., 203 South Palm Avenue.
Prompt Wire Service
LOS ANGELES
revaluation
Government
was
likely
from
to
be
As
accused
Washington
of
the
often accused
American pressure.
Western Markets in
a
of
when
European
of
currencies.
The
abstaining
from
once
more
revaluing
to
pressure
sterling.
DENVER
ESTABLISHED
Membeis
and
having devalued sterling under
yielded
•
SALT LAKE CITY
•
J. A. HOGLE & CO.
British
Tel.:
WHitehall 3-6700
New
other
50 BROADWAY
result of Mr. Snyder's intervention it is
having
SPOKANE
any
the recent intervention of Mr. Snyder in the controversy
a
•
1915
York Stock Exchange
Principal
r.
with a. M. Kidder
FOR BROKERS AND DEALERS
by publicly declaring the opposition of the United States Govern¬
to
,
Chronicle)
■
•
a
Its
to
Meyer Buchman will be considJuly 26 'Chron- ered by the Exchange on Aug. 23.
that hits the
article
an
&
Transfer of the Exchange mem-
(Letter dated July 28, 1951)
exports to a
government is reluctant to revalue.
to
this"
Floyd Augustine retired from1
partnership in Nielsen, Gordon &
sell."
This Happens Too
To
wonder
f
.
is to buy or
further upward move-t
the
is
this
s^e solution if our industry is to
why he did not sell some, and he
substantial
^
them are advertised with the
™side market.
For instance,
Portsmouth Steel is quoted 13-/8wvvr/
"0f cours^ lf /YZ & C°. °r a"Y
other member firm caresi to sell
any stock on a commission basif
Abbott, Proctor
as of July 31.
extent.
resisting revaluation
easier by
ment
Nov. 25-30, 1951
are
considerable
It
Nov. 16, 1951
just put
}?cal stocks, practically
claims.for wages increases, and they are not likely to withdraw
these claims merely because of a revaluation of sterling.
If their
ment
(Dallas, Tex.)
have
we
/
banker, and
price of the next transyour stock on the exThis is a much wiser
in
/
something should be done about
.
firm
a
stock
a
her
technique than giving your broker
or banker a set price at which he
this
there are indications, that wages and prices in
rise during the next few months. Some of the most
powerful Labor Unions
Security
A*-
i
will
or with your
about the
of it,
the government would be blamed for having brought about
additional deterioration through the revaluation.
Britain
with
of
member
a
change
consequence
a
"I arCi enclosing a list of prices
united stocks taken from thi£
mornmg s p a p e r, inserted by
(name®
firms omitted by Edit°r)\ They have been doing this
for some time, and you will notice
W1^ the exception of some
or
action
Moreover,
T
.
sell at the market.
Buy¬
or
selling 'at the market'
means your order will be filled at
of proving that
or
Deal
as
on
recent ar-% this b
a
you place an order to buy
sell, do not set a fixed price;
or
mind, and
lost a sale.
could
the investment fraternity.
when
it would be due to the decision not to revalue. On the other hand,
if sterling should be revalued and the balance of payments should,
,
1;
is
Nine:
No amount of
at 18%.
us
explanation
j
change,
"buy
ing
it from
of.unless,7™®high busivo urae of trading), that is their
restrict
position in which
a
If
deteriorate there is
.
Sept. 30-Oct. 4, 1951 (Coronado
that
commission, and could see no
why she should purchase
a
reason
unfair competition to the rest of
^
excerpt from
The next morning
5%.
informed
by the customer
she could have bought the
stock from XYZ & Co. at 18 plus
commissions with listed
ever been
studied as
"Rule
comfortable export surplus and the influx of gold
In the meantime, however, the situation has
a
lu-
,
few months ago Britain could have afforded the risk
adverse effect of a revaluation on the balance of payments.
was
than
lictori
uritv,
stated:
of estimat¬
means
bit
a
problem
securities'"
securities.
The
a
changed. Britain is
.in the dark would
Country Club. Cocktail party Sep¬
19 at
Blackstone Hotel,
tember
Sept. 24-26,1951 (Cincinnati, Ohio)
There is
the
tide by one columnist which this
dealer referred
to in particular
considerable.
was
Bunkers Annual Frolic at Omaha
'
to
a
con-
on
was
firms
'shi? of
ship ot
ing the extent of gains and losses, and a revaluation would be
therefore a gamble from the point of view of its effect on the bal¬
ance of payments.
Security Traders Association of
New York outing at the New York
Athletic Club
Omaha.
more
and
LrMjon;n
import. The price factor cannot be disregraded. While it is
true that Britain could easily increase her exports of coal or steel
in spite of a devaluation 'of
sterling, her exports of luxuries and
(New York City)
Nebraska -Iowa
once
situation
„
their
Club.
Sept. 7, 1951
inclined
after
me
this business,
in
onmmicoinnc
splitting
no
now
public
over-the-counter
Has
crnntivxnr
Sterling; Area would be able to sell their export¬
are
abysmal
the
astonishes
present
dicrous.
advantage is gained by main¬
too low international value.
They feel that
armament. most countries
of
of
developed
the rush to sell Mutual Funds by
Stock Exchange firms only makes
sterling were to be raised.
Those who put foward the above argument over-simplify
the position. They seem to assume that all categories of export¬
able goods behave in an identical way. In reality there is as
yet
no
indication of any such uniform trend. It, is true, there are
shortages in certain exportable goods. On the other hand, there
is still a buyers' market in a large number of other
categories.
In particular non-essential goods remain highly
competitive, and
tend to become increasingly so, precisely
because, owing to re¬
(Rockford, 111.)
be
way
way
The
the
still
years
some
cooperative
dealers?
market
able surpluses even if the value of.
Aug. 23, 1951
all
a
prominent
a
can
in
public
Is there not
more
concerning
the
consequence.
To this argument the supporters of revaluation
reply that, since the world is rapidly becoming a sellers' market
and the progress of rearmament will in
any event reduce the
EVENTS
by
general
of
the
misunderstanding
an
surpluses,
article
a
by
type
given* to
/doing business
favor, at any rate as far as the countries outside the
Sterling Area are concerned.
Opponents of a revaluation, on the other hand/maintain that
a revaluation might result in a
sharp fall in the volume of British
and Sterling Area exports, and that in spite of a favorable
change
volume of exportable
the
columnist.
*
'
by
recent
in the terms of trade the adverse balance might increase further in
COMING
pro-
you
Dutton, one thing is sure,
b 1 i c relations are not
advice
and
expose
the
questions
p u
-helped
of Ministers
that
of the
"Mr.
Paul
Britain's
:'/■
Mich. —Ro¬
John
and Olin R. Walker
be
salesmen, and
pound in your last article.
Sterling Area gold reserve during the
It is true, those who feel very strongly that
payments
for several
provocative and into
when I
ago
that
in this business I have asked
many
Dr.
bears
times and
1
enjoyed
your
years
valuation.
Richards & Co.
RAPIDS,
of
subject.
survivor of the five difficult
a
as
gov¬
to
have
years
argument for and not against a re¬
They rightly point out that one o£ the main causes of
the adverse change in the trade balance has been the adverse
change in the terms of trade, the prices of imports having risen
much more than the prices of
exports during the last 12 months
They argue that this state of affairs could and should be cor¬
rected by a revaluation which would
change the terms of trade in
Spring
GRAND
minds
the
•structive letters
decline of the
sterling should
South
(Special to The Financial Chronicle)
a
third quarter of 1951.
affiliated
634
"I
sterling devaluation
still fresh in the
are
additional in-
some
on
(Letter dated July 23, 1951)'
;t
Since the turn of the half year the
agitation in "favor of re¬
valuation has abated to a considerable extent. This is due to the
deterioration of the British balance of
payments and the pros¬
(Special to The Financial Chronicle)
v
against the
that
occasioned
was
this prospect sevevil
finally made the sale,
We purchased this stock at 18 and
put % of a point on, which was
called
less
concerned, how¬
officials, and none of them would want
the repetition of that experience. *, r '
Stock
Exchanges,
'
1949
of
problem
with
concerned
A Texas Dealer Writes
be^ kept ' a
closelythe last moment." More¬
Mich. —Sarkis
P.
Bayekian is with Watling, Lerchen
all
official
must
the criticism
over,
DETROIT,
give
formation
the
currency
reproducing two letters which
this
great
Exchequer and his subor¬
dinates displayed tight lips and an
expression¬
less
face.
This
was
quite
understandable.
Any decision regarding a change in the value
Watling, Lerchen Adds
the
other
and
were
in
views were expressed in either sense.
pressed by Members of Parliament, the
When
'
Financial
as
Press
and
should
ever, no
,
(Special to The
far
the
government spokesmen
.Opening
of
the
new
office
Was
previously -reported in The
•
in
appeared
instance
out this article
summated a sale of 100 shares of
stock at 18% to a prospect 20
miles from this office.
I had
am
numbers, and frequent reference was made to
the subject in
Parliamentary questions and de¬
the
"Chronicle" of Aug. 9.
stock
a
it and it wouldn't pay
on
"Another
couple of months
certed
the government, too, a fierce battle
raging between those for and against re¬
valuation. Articles advocating or
opposing re¬
valuation
municipal bond de¬
partment and Alfred R.i Seebass,
special representative.
ager
plus
was
:
Bank Building. John T. Webb will
mission
him.
completely
preferred to keep aloof from the contest.
-
Denver office in the First National
be manager, John H.
wholesale
at
Within
.
an¬
of
sugges-
eliminated by a concooperative effort of
the entire investment fraternity, I
them
;DENVER, Colo.—Cruttenden &
Co., members of the New York
and Midwest Stock
the
exchange commission ought to be
rapidly becoming a matter of acute controversy.
Every econ¬
omist of standing was
expected to take sides, though many of
was
I
with
^practice of selling unlisted securi-
LONDON, Eng.—Until about the middle of this year the con¬
troversy over the question whether sterling should be revalued
Opens
connection
tion made in this column that the
.
Crulfenden
By JOHN DUTTON
higher level
to be congratulated
and
whole-hearted
In revit wing arguments for and against
sterling revaluation at
this time, Dr. Einzig contends a revaluation to a
Exchanges
NEW YORK 4, N. Y.
Teletype NY 1-1850
16
The Commercial and Financial
(608)
Chronicle
.
..
Thursday, August 16, 1951
$35,680,000 Issue
Our
Reporter
NEW BRANCHES
NEW OFFICERS,
the constructive side, be¬
cause of the combination of moderately enlarged buy orders and
no important increase in the supply side of the equation.
Quota¬
tions in some instances nonetheless appear to have gone ahead a
bit too fast and this might result in market indigestion, which
market is still
on
REVISED
be sizable
to
Harry
of
without
friends,
however.
Following
of the importance
■,
agreement
an
Features Market
*
ap¬
the
»
Lake
H.
replacing Robert F. Fountain, who
Mr.
been
elevated
to
Chairman of the Board.
There is no doubt the recent action of the government market
followers of it talking about what has taken place and
$200,000,
President
trying to figure out whether it has been done with mirrors or not.
As previously stated, the market is not broad, volume is not large,
and accordingly many operators are not sharing in the business
"that is being done. This is not a desirable situation but it is the
his
of
branch,
Angeles, Calif., has
Los
that
construction
has
Westwood
Westwood Village.
1088
at
now
in
Boulevard
building is be¬
ing erected at 10925 Kinross Ave.,
The
modern
new
block west of where Citizens
one
presently
He began
with the batik in 1923,
career
ago.
years
Edward J.
Because
dealers' positions have been light or
instances, there has been less of an oppor¬
the available orders. Such a picture should not
until
held
he
post
he
He has been
President.
Mr. Mark is
the
Middlesex
-
maturities
1957
3.10%,
of the
the
applied toward a long-range
of bridge and highway
obligations, the life insurance companies and savings banks,
in
"Procedure
He
expenditure
District
a
Universities
increased
in
817.000
1941
west
mainland
much
bearishness
is
the
for
good
no
market.
Uncertainty
transit
nearly always been around, with the degree of it in many cases
being altered according to the desires of the monetary authorities.
At the present time, the uncertainty that prevails could keep the
market from going too far in the direction that might not be
healthy for it.
v
Federal, it
Fountain
one
far
as
wherewithal to
a
halt
to
in
is its
Board
of
Buying Orders
been
have
recent
con
been
answer
fair
of
majority—are
again,
size
pension
while
others—and
they still
the small side^
purchases for pension funds that they act for
or
are
V y
The election of
as
seem
of
have some
of
the
by
Glenn
K.
Also
,
...
....
The
Joins
ST, P E T E R S B U R G, Fla.
Thomas
E.
Jobin
has
smaller
fices at 762 First Street,
engage
He
in the securities
previously
Heagerty & Co.
was
—
mated
the
capital to
North, to
business.
with
-
W.
H.
is
111.
now
—
Kenneth
affiliated
of
L.
Dempsey &
Company, 135 South
La Salle Street, members of the
$50,000,
increased
was
with
result
a
$450,000,
about
while
of
the
a
ANGELES,
R. Aronson and
have
son
the
$625,000
to
capital
further
was
the
stock.
Midwest Stock Exchange. He was
new
previously with Otis & Co.
became
sale
The
effective
of
Street,
associated
Aug. 3.
con¬
seven¬
doubled.
$380,000,000
in
Of
total
1950, about 72%
exported to the United States
contrasted with 56%
with
the
Co. Inc.; Smith,
Lassor
added
in 1949.
principals
&
Stuart
Barney &
Co.
Securities
II.
Inc.;
Corp.;
and
the
to
staff
Calif.
has
Grosberg
of
He
—
been
Shearson,
Hammill & Co., 9608 Santa
(Special
with
H.
was
Monica
previously
Douglass Staff
Ford
.
.
to The Financial Chronicle)
HILLS, Calif.—Jane
has
joined the staff of
Douglass & Co., 133 North Robert¬
son
621 South
members of the
Stock Exchange. Mr.
was
formerly with Ed-
Aronson
gerton, Wykoff & Co. Mr. Hodson
with Morgan
was
& Co., Buckley
Lynch,
Boulevard.
(Special to The Financial Chronicle)
SAN
FRANCISCO,
Calif.
—
James E. Doyle has been added to
staff
the
Consolidated
of
Invest¬
ments, Inc., Russ Building.
Rejoins Waldron Co.
(Special to The Financial Chronicle)
Calif.
FRANCISCO,
James E. Smith has rejoined
He
—
Wal¬
&
Company, Russ Building.
was
recently with Capital Se¬
dron
curities
to
Co.
of Oakland.
Joins Waddell & Reed
in¬
of
capital
Grimm Opens
L.
A.
Reed,
nue.
CITY, Mo. —Richard
Hirsch
Inc.,
is
with
Waddell
&
1012 Baltimore Ave¬
Branch
JACKSONVILLE, Fla.—Grimm
&
Co., members of the New York
Exchange,
announce
the
opening of an office in Jackson¬
Stock
ville, Fla., under the lhanagement
of Kenneth M. Keefe.
With Cons. Investments
brought
$175,000
enlarged
than
more
BEVERLY
Calif.—Milton
Douglass M. Hod-
become
KANSAS
by
period the value of
BEVERLEYHILLS,
Los Angeles
of
stock
$400,000
esti¬
In
an
1950.
electric power consump¬
and
has
(Special to The Financial Chronicle)
LOS
(Special to The Financial Chronicle)
to
crease
from
to
in
Joins
SAN
as
1939
in
province's
Two With Barbour Smith
of
President.
$400,000
years
forestry,
with J. Barth & Co.
of
the extent of $225,000,
from
of
Baltimore Stock Exchange.
.j.
it
recent
$1,256,000,000
same
a
Springfield, Ohio, has enlarged its
dividend
Dempsey Co.
CHICAGO,
Eaton
Morris,
..4
increasing
(Special to The Financial Chronicle)
opened of¬
Co.
Lagonda National Bank
$625,000;
(Special to The Financial Chronicle)
Trust
and
In
industries
Boulevard.
Caughlin has just been elected
member of
the Philadelphia-
Stanley H. Heist
ing Fund Society of Germantown
and its Vicinity.
companies and charitable organizations.
Thomas E. Jobin Opens
the
posi¬
State
corporations that have sizable holdings of shorts have been nib¬
as
a
Mr. Heist is President of the Sav¬
apparently their favorites.
bling at the higher income issues,
of
1915,
director of National Bank
a
facilities.
Mr.
Philadelphia has been announced
funds have been among the buyers also of selected issues of
taps,
'63-68s and the '65-70s
cashier,
north
Barbour, Smith & Co.,
making
manage.
Finance
Brothers,
and
Merrill
V'*'!;jfe:.'VM.'''.-T'v'"'"r'V Pierce, Fenner & Beane.
'
A good many of the
mercial banks and it is indicated these institutions
insurance
secretary
He is also
Germantovvn
on
Edward J. Caughlin & Co.,
Building,
Philadelphia.
lin,
Flower
since
bank
the
in
(Special to The Financial Chronicle)
August 22, for Edward J. Caugh-
also
Directors
tion he has held since 1946.
Some of these
funds.
buy orders have been coming from trust departments
with the
of
the
elected
board.
the recent trend of the market, where has the buying been coming
are these buyers?
The best informed sources come
to be in the
the
was
Morgan Smith, who has
with
was
from and who
orders
He
trust officer and named Charles A.
Aside from the fact that owners of long Treasuries are still
reluctant sellers of these securities, and this is very important in
same
service
elevated Miss Jessie B. DeHart to
Burton
the
was
Eberwein assistant trust officer.
Source
with
County.
on
lower
Shearson, Hammil! Adds
only living organizer.
The
believe it should be done.
up
He
of the organizers of the bank
Middlsex
increase
major
Edward J, Caughlin
bank's first cashier and officer and
if and when they
developments
he
post
helped it grow to the position
of fourth largest commercial bank
the
call
1935.
Mr.
has
seems,
as
1928 to
and during his 49 years of
is content to assume a passive attitude, at
higher yielding governments are concerned.
This will no doubt continue to be the case as long as the forces
•operating in the market do not get too far out of balance and push
the trend of prices out of line in either direction.
It should be
remembered the Central Banks still have the power and the
least
the
to
returns
held from
the
mining, agriculture, fisheries and
manufacturing
have
increased
their total production value from
Birthday greetings are in order
of the Board,
As Chairman
has
province
and
Wood,
Gundy &
Co,
Inc.
McLeod, Young, Weir, Inc.
and Loan Association.
Too much bullishness or too
the
a
an
unfavorable development.
of
Island
with the imnrovement of overland
ley &
He is also a
Banking.
is
in the offering are: Harriman Rip¬
and
is not
of
Population
but there has been con¬
siderable
director of the Providers Building
School
corner
Vancouver
graduate of the Rutgers Graduate
that
from
estimated
an
1951.
Dominion
is
to
largely concentrated in the south
The
No one
to be how long is this going to go on?
know and
in
1,165,000
population
Is¬
beyond doubt is what keeps not a few
operators in governments on the cautious side, and this probably
seems
to
seems
in
Halsey,
and
most
westerly province of Canada, has
Co.;
Mr. Mark attended Rutgers
York
from
Associated
sue."
New
the
approximately
the fiscal year
through 1956-57.
British
Columbia,
the
New
Bond
pro¬
con¬
provides for
of
export trade
of
is author
Financing
School
Jersey
are
still reluctant and and only minor sellers of these securities. Their
action of not hitting bids as prices move ahead has many operators
in the money markets a bit confounded, to say the least. The big
question
Association.
ers
which
struction
com¬
a
3,65%,
and
gram
as
as
1956,
$26,300,000 v/ill
bills and
$8,700,000 will be
of
balance
the
mittee member of the N. J. Bank¬
The largest liquidators of Treasury
government market.
3.25%
3.20%,
tion
well
as
1955,
debentures
be used to pay Treasury
was
Comptrollers,
position building, ,
the supply of issues for sale is still on the modest side, and this
continues to be one of the most potent forces in the recent trend
15,
The
1976.
respectively.
member of the N. J. Auditors and
Liquidation at Minimum
maturities
priced to yield approximately
are
County Bankers Association and a
To be sure, at the present time despite some
of Aug.
and
fold
past President of
Somerset - Union
a
four
into
struction has increased over
director
of the bank since 1936.
remedied, however, if the recent trend turns but
thing."
4
divided
is
debentures.'
in U. S. dollars,
bearing interest rates of 3%, 3%,
3% and 3V2% for the respective
$333,004,000
Cassghlia
became
a
Canada,
Columbia,
its
located.
Birthday Sreslirags for
teller, cashier
vice-president, a
executive
and
be long in being
to be the real
49
advancing through
some
tunity to get in on
Co. Inc. made
Ames &
E.
The issue, payable
the
of
President of the bank since it was
nevertheless.
jointly
1950-51
begun on a new building to re¬
place the present banking quar¬
ters of the University-Westwood
is
founded
'non-existent in
A.
$91,400,000
*
fourth
the
becomes
*
Ivey,
announced
has held that post of 16 years.
Mark
Brownfield,
of
Bank
D.
Bank
Joseph G. Mark has been elected
of the First National
Mr.
the
Citizens National Trust & Savings
■'
'.
the
to
served to
capital of the First
* •
President
has
stock
new
$100,000 to
effective Aug. 2.
Bank of South River, New Jersey,
Fountain
of
sale
increase
Bank
has many
'case
group
Of the proceeds,
and
amount of $75,000 have.
*
*
;i';1
of
as of Aug. 1, from $600,000
$1,000,000, as a result of a stock
A stock dividend of $25,000
stock.
if
•
dividend of $400,000.
capital from $75,000 to $100,000
by the sale of $25,000 of new
both from investors and
professionals. The acquirers of Treasury obligations, it seems,
have assumed a somewhat bolder attitude and, with the supply
not appreciably larger, this has had a favorable effect upon quota¬
tions of these securities. Dealers and traders have expanded hold¬
ings'in a modest way, and this is generally considered a good sign
because they are usually in a position to get a fairly good feel
of the market. On the other hand, there has not been any all-out
bullishness among them because they appear to believe it is still
too early to get too enthusiastic over the whole situation.
of buy orders which have been appearing
.•
•
Bank
capital
to
N. Y., increased its
Ronkonkoma,
: ■"
v
Texas, from
As of Aug. 1 the National
of
Lake
Ronkonkoma, at
display virility on light
*
National
Union
National
*
1
'•.; it:
•
Springfield, Mo., has enlarged its
Association.
volume, much to the surprise of many operators in the money
markets. Nonetheless, there has been an increase in the amount
)
$100,000.
The
(Aug. 1) to the Rockville-Mineola
Savings and Loan
'\
■
July 17, from $200,000 to
$300,000 by a stock dividend of
ijs
changed
technical position of this issue
appears to have been greatly improved because quite a few of the
par liquidable bonds have now gone into strong hands.
The government market continues to
*
proving the merger of the Mineola
Savings and Loan Association of
Mineola, N. Y., into the Rockville
Centre Savings and Loan Associa¬
tion of Rockville Centre, N. Y.,
the name of the latter has been
made considerable progress and the
Substantial Buying
10
Aug.
on
■
The 1952 eligible taps have not been
The bank 21/2's of September 1967-72
these buyers.
York, retired
years' association with the
He had been the officer in
*
purchasers of long Treasuries have pretty well spread-
to
ton, Ohio, increased its capital, ef¬
fective
charge of personnel since 1932.
eagled the whole restricted list, with the highest yielding issues
of income
The First National Bank of Iron-
Vice-Presi¬
Burgess,
C.
New
bank.
being.
still getting the greater part of the play because
underwriting
An
headed by The First Boston Corp.
and
after 32
securities for the time
of these
sellers
1
'
,
dent of The Bowery Savings Bank
there seems to be a growing feeling that prices of
Treasury obligations are not likely to have muca of a setback,
if any, from current levels.
This would appear to be predicated
upon the assumption that non-bank owners of governments are
likely
/
public offering on Aug. 16 .of
$35,000,000 of Province of British
of the trend,
Recent
'
Bankers
and
ETC.
CAPITALIZATIONS
could be cleared up by churning or backing and filling. Although
certain operators in the money markets still question the validity
not
Debentures Marketed
CONSOLIDATIONS
By JOHN T. CHIPPENDALE, JE.
The government
of British Oelaittbia
News About Banks
Governments
on
Volume 174
Number 5038
.
.
The Commercial and Financial Chronicle
.
(609)
Rail
category from those computed
Freight Rate Rise Lower Than Requested
the
basis
of
17
on
monthly
sales and
inventories, but they
thought to present a more
month-end
Grant by
Interstate Commerce Commission of 9 % increase
6% for West and South falls short of
were
typical picture of the period than
for Eastern lines and
those of any single month.
15% asked by railroads.. Increase to end Feb. 28, 1953 unless
continued in force by ICC.
The Interstate Commerce Commission
-Inventories
the
for capital additions to the
essary
Aug. 8 announced it
had granted railroads operating in
the
and for railroads in the South and
take note of the
of these outlays
West
under
East
freight
wholly from income, but we must
rise
rate
6% rate increase. The rail-
a
in
roads
9%
a
the
petition requested
general rise of 15%. The increases
inninS.
include
ipmnnnrv hnnct nf 4ct.
temporary boost of 4%
o
a
for Eastern roads and 2%
other lines.
The
into effect after
go
and
to
are
unless
expire
not
v...
,
statement
a
by
Sylvania
15^days notice,
decision
the
Walter
different
were
related to
these
securities.
Commission
°£ P°slt>ons t0
sa!est
«»
expected to be somewhat smaller
c
S.
than
for
businesses
have any agency
Railroad, after the ICC
was
announced, disap-
Two
ratios
that
do
not
sales.
have
loading
that
fruits
fresh
The
Office
in-
no
and
proposal of the Eastern railroads,"
vegeta-
increaSe requested.
the rails
request
the
on
.
.
they would be reflected in
higher prices. The ICC, however,
maintained
have
that
been
outbreak
the
of
Korean
essential
was
volume
railioads
to
a
ke
that
reports
recurr^
to
the
effect
in
ever
this
merely
arrea?s^
arrears was in
t
near-term
nothing
eomplished,
of
one
Mav
a
railroad
in
the
PrP(:„maw„
most
recent
temSorJv nn^
analvsts
i™,
looking
are
iZ
trend
fm-
month^
fall
A®L£ ™,u,
from the less favorable
some plan of stock recapital-
jzation designed to eliminate these
Texas
-
down
...
.
.
traffic trend, the road has been
prospect. hit
by outside influences that nave
hPPn'
u-y
uuiuences mat have
majo'r SLtSi
the
be
granted
war,
trans-
defense, that
additional
difficult
rev-
enues.
xp ;?
mgoff
the
eacb
nn^
f
major
right."
should be emphasized.
-
,
-
-
,
to
,
this
In view of
of over-the-counter securities.
J
iThe small size of inventory
holdings of investment banking
ventory-to-sales ratios, is the
treme
.
suggests that the inventory
policies
these
of
firms
have
policies vary widely among industries, among firms within indus-
in
V
the
,
reduce
being
ex-
firm-to-firm
inventory
given
stock
if
-
heterogeneity
policies.
Part, but
certainly not all, of this result is
tries, and in a single firm over a
period of time.
Serious mistakes
not
homogeneous
of the most interesting findings,
evolving from this analysis of in-
policies have not been important factor
th»
J
flood,
J
nnn
S
"f Ismnnn
?™peof
„„
traffic.1 Under the circumISS
«If I^ZorTtrnovef
be^recognized TatjSly
thus
was
-
.
amount
able
.
of
unfavorably
umavoiduiy
probably
with
wnn
a
compare
vear
a
>ear
ago.
arrears
amount
now
Bellamy, Marsh
Named Directors
stated that active consideration is
ferent groups are usually not significant. - As a matter of fact, one
sity of Pennsylvania holds small commitments by dealers in¬
the
high
as
?ti the
in other respects, moderate variations in these ratios for the dif-
Willis J. Winn, made under auspices of the
movement
firms
even,: among
Securities Research Unit of the Wharton School of the Univer¬
or
eh
of
qualification appli- long delayed. In a recent
mid-year
entire discussion report
to
stockholders
it
was
cable
Inventory Policies of OverGottnier Firms
level
a practice °f Pay"
and
«
hPPn
substantial variability of
inventory -to- sales ratios .found
in
h
ratin g m^rplv th^rPoVn'
to $1>355>586- However, no pay/fulTif
recip- ment was made on August 1 and
aal°*
™
road
one semi-annual coupon earnings will
month
-
to
the very
dicates their inventory
time the
some
substantially—they
J®®
the
'
:
^
the
w
m
revenue
For
the
unaame ta ly
should have been given the same
convinced," the Comstated, "that money nec-
are
Research study of
up.
A_.
One
"We
mission
cleared
relationship:
same relations ip. a hign P°S1"
a high nnsi-
will
continue
to
terest. Obviously nothing could
be done, or can be done, for the
preferred stock until the Adjustment bond accruals have been
management recently stated
expenditures needed to meet the !?Tsales ratl0Suhav
beean used in, that liquidation of the balance
demands of the defense program.
+b^s
would depend on the amount
«Qtber industries have been alLt available from current earnings,
lowed to increase their prices to
nH„pn L.clJI nf thp HiPtniw
Z APParer|tly the management has
meet tbe cogt of wage increases
tw^d
ta led re- confidence that elimination of
and materiai costs. The railroads lationships analyzed.
thig obligation will not be
too
pprtation system adequate to meet
the needs of national
it
decision
the
^lso,
fundamentallv
exDress
same
produce reasona time when the
business is on a high
of
leveb
to
ties
restricts
seriously
ability to
earnings at
able
higher
particularly since
operating costs
and it
the
subjected
which
JK.
their
ground
-
,
that
firms
and
rumors
B6tT£ been f°ll0wing
dustry wil1 sutfer from this decl"
the rails' remiest
increases
rate
I
On and off for
many
news.
years there have been
ft the end of the period. The lat-
,?
"Unfortunately, the railroad in-
Stabilize
Price
of
tll had InL
tion Li opposed
.
Kansas
-
dividend
tbe
Commission.
ruled
b
i
in the
widely
Ic<5 practically cut in half the sis expresses positions as a percent
of rales. The other expresses sales
tain charges, such as those for
Mr. Franklin said. "Certainly, the as a percent of positions and indiprotective services for loading or figures presented in the evidence rates the multiple that sales for
unloading livestock and for un- clearly showed the need for the the period were of the positions
they
of
arrears on Missouri-Kansas-Texas
preferred stock has again been
tj
been
question
on
will be authorized on cer-
creases
the
The
extended
state Commerce
for
Missouri
To
theg cotporate stock alone), the relation-
Franklin, President of the Penn-
to
are
if
encouragement,
~
In
for the
rates
new
the
of
sales figures (estimated to constitute approximately one-third of
fact that many
are being made
the insistence, of the government
and the shipping public."
a
sales
j^e extent that agency transacj;ions werei inciluded in the total
railway systems should be derived
on
in
types of securities
attributable to the short tim<* period covered. Though the aggre-
further
dependent
a
of
a
been
develop
certain
data
and
be
in devising
use
equitable
plan which
by the I. C. C.
be approved
may
and
in-
have
management's
fair
that
stated
engineers
to
engaged
for
formulation
to
readjustment plan,
was
to the stockholders. In this connection it may
be recalled that
to
put
plan
F. Wilder
Bellamy William P. Marsh, Jr.
acceptable
through
for
arrears
the
earlier attempt
an
special meeting
a
of direc¬
tors
tors of National Distillers Prodof National Distillers Prod-
ucts Corp., F. Wilder Bellamy, senior partner of Dominick & Domby the inick> and William P. Marsh, Jr.
readjustment
a
Adjustment
turned
was
Commission.
At
.:
down
bo'id
considered were elected directors. Mr. Marsh
are of some likely
that
an
equitable stock is President of U. S. Industrial
building up excessive inventories. ;interest in
themselves, the discus- readjustment proposal would be Chemicals Co. Division of Na~
ol
of security prices or even signifi- Individual
sigmti- individual.; experiences
;
provide sion highlights
.
..
—
only those differ- similarly rejected by the govern- tional Distillers.
cant movements about this level, the chief guide to policy, but these
ences am0ng groups of companies
ment agency. In its mid-year reThis conclusion is presented in a have not always provem adequate,
;whiCh Seem to be associated with port the management went on to
monograph entitled "Positioning One possible supplement to expe- the characteristics
of the entire say that it is
anticipated that a
of Securities on Over-the-Counter rience as a guide to policy is the
group> that is, which characterize stock plan will be ready for conMarkets," written by Willis J. knowledge of the practice of the ;most of the firms irl the
grouP) sideration about the
time that
Winn and released by the Securi- group as a whole and of. differrather than only a few firms which
Adjustment bond interest is on a
ties Research Unit of the Wharton ences within the group.
•
receive large weight in the aggre- current basis
.■>
:
<
'(8pecial t0 THE PlNANCI*L Chr°nicle)
been
important
an
factor
in de-
been
have
made; in the past in gate resujts presented
termining either the overall level
It
is not
Four Join Staff of
Prescolt &
School of Finance and Commerce
This
study
the second
is
nationwide survey
i/
period
of over-the-
68 ^ nSw
was made possible
nf f
undertaking
h
by
Mr:
'
a grant
tp_ the Univemty of Pennsylvania by the Merrill Founda
..
.
tion
for
.
A
the
o
.
Advancement
o
Knowledge,
ine grant
is
usect
unit
by
to
tne
obtain
quanu-
tative miormation about over-tneCOU'nter
markets
the
of data available on
mass
to
supplement
ex¬
change markets and thereby pro¬
vide a better picture of the over¬
all
security and capital markets.
The
me
^
\
size
of
study points out that the
stuay points out tnat tne
security positions held by
investment
banking firms,
gether with the reported
on
gate results.
to-
analysis
s
relationship
im
in
or
standing,
Reference iS often made in the
the "overhanging'» new-issue inventories or to
the
A speed-
of trading or
sharp movements in market prices
may lead to substantial alterations
jn p0sitions in outstanding securitjes
b
d
inventorv
while
the
outstanding stocks.
The
study
notes, however, that in spite of
the nrpHnmiranhp nf hnnrls in the
the predominance of bonds in the
total holdings of investment banking firms, some position in stocks
4bp clearance from dealer shelves
the plpnranrc from dealer shelves
in
th
positions in
stocks represented less than one
tenth of 1% of the value of all
financial press to
up
volume
held by a greater number of
firms than held bonds and, also,
was
in
while firms in the securities
tinnc
s
hr
ran
,a^
rondncted
.
T
large inventory.
the
nrimnrv
,
_
,
of
one
of
creating markets
more
taneniisiv
t
shnnKr
PP y
,
an/
d
f
of
inventory
effort
to
variations
tLnf1rflrv
ments out of
alysis
le«?s simul-
or
little
a
in
demand
uerna
a
h,r
oy
adinct-
aaju
i
the
Dpriods
of
Inventory
is
uvailable
cha"^es
dustries
of
be
not
a
greater number of instances,
P.08',"0"5'
time
the
has
as
dG^rg6
nf
nnlv
would not support any additional
amount of
preferred so that it
with
likely
will
that the
have
common
The
road
to
related
to
and
and
Novemher
November
monthly
sales in the same period.
These
three-month
average
ratios did
not differ materially in any major
average
puv
tt
Prpcrntt
Rank
^
n#»w York and
H1e ,New
Co
Building
0
National
member*
of
Midwp«?t. stock-
d Mldw®st st0^fc
.
•
entire
ar-
be; satisfied
pretty well. Like
so
off
the
Security Dealers '
The New York Security Dealers
will hold their 26th
Association
annual
dinner
o
on
annual_dinner o.
Friday Nov. 16
at the Waldorf Astoria Hotel, 'i
year
other
many
10H% -°tf S6 carriers, and in the general terparticularly carrioperating
Specialists in
ers
ritorv
N. Y.
stock.
started
covered
ThG
srnsll
firms
wgfg
of
some
vgst
^ r o ss
:
To measure the relationship of
security positions to sales for investment banking firms, average
month-end inventories for SepOctoher
October
j
nf
ahnnt
^
millinri
Tbic
only about $6.5 million. This
equivalent to $9.75 a share
on
the present $7.00 preferred
stock.
Obviously earning power
of
was
Securities and Exchange Commis-
.
wdiI
«r
v,n
bv
Katv
the
road
vear-to-vear
:
?kCn RScaddin^CJr"0^^ Jo^a
readiust.ment
Arrears
readjustment. Arrears on
Mr. O'Connor will be in charge
Katy preferred now amount
of the firm's new office in the
to $138.25 a share, a total of $92,213,000. In comparison, the com- Huntington Bank Building, Columbus.
pany in its best year of the past
decade, 1948, reported net income
/
stability.
CLEVELAND, Ohio—James N.
nos-
the
broker-dealers registered with the
long
iust
Company
neebt
the
the' Boston &
wcre f°rmeriy'
rears
infor-
feasible
course
seems
inior
over
will
&.ecu"lie® ai?a ^xenange tommis ritory covered oy Katy, tne road
y.
sion held about three-fourths of has more recently been having
m the ratio for many in- all the inventories of stock.
its troubles. For the first half
mdicstc 3. marked
of
p^noas V1 "J116' V?
tember,
"
.
mation
were
relationship
sales.
th^latter "area"'^where6^this
tfle..iattep areas wnere tnis
it
Maine
Maine
ventory of securities.
business may be more sensitive to
tPrnbf,r
inventory.
S,
to
appears
bringing buyer and
seller together
nff
invent-
.
today, the study reveals,
be
a
,
In other words,
fnnrtion
ment bankmrs in
to
opera-
without
,T
other
stocks represented their entire in-
yolu"Je these factors and may adjust their
Tbe report further reveals that
tZlel hidings more quickly, such de- les\ ^ 10% of all Investmeni
hav^developecTto^po^nrwhere vy}opryen.ts are aj!°
in banking firms held 90% of all seextensive' merchandising
Presnmahlv
IpproStety
or m
both,
of new-issue holdings.
,
1% of ^bp value 0f ap bonds outthe vajUG of all bonds
.
positions
m
,
as a re-
,
.
sales
Th
independent fluctua-
,
.
observed
change
may
suit of either
-
aggregate security positions sible to formulate any plan with0f investment bankers Were pre- out
giving the present preferred
dominantly bonds, the study shos. stockholders a large share of
Only 11% in dollar value of the common Stock equity. The arrears
positions of all firms was in stock, are just too large to make any
Consequently,
is limited to
The
survey.
-
The
behavior pattern at the time
this
0f
securities
being
available
is
time.
of
Winn
tions
Financial
Kesearcn
information
the magnitude of security P°S1"
tions and sales over any extended
a
m
summarizing the resul s o
senes
a
No
rgvonugs
but
equities,. Mr. Winn found in
the
off by
study,
the
age.
and
these
firms
held
largest segment of unlisted industrial equities positioned by investment
ment hankers
hoth
bankers, both ahsolntplv and
absolutely and
relative to their net capital.
The
the
new
study is published by
University of Pennsylvania
Press, Philadelphia, Pa.
a
was
SECURITIES
was
roughly similar percent-
Net
period
incrG3.SGd
netfneome^^
RAILROAD
Selected Situations at all
Times
of
$1,825,598 for the
equivalent to $2.74 per
preferred share, compared
$3 01 a sham ma1i7PH in
$3.01 a share realized in thp
the
with
j * c O 1/
nnpn-
open-
New York 4, N. Y.
ing half of 1950. The management
stated that car loadings continued
25 Broad Street
to increase during the first quarter
but leveled off in April and started
Members Nat'l Assn. Securities
Telephone BOwIing Green
9-6400
Dealers, Inc.
18
(610)
The Commercial and Financial Chronicle
'
'I
'
Thursday, August 16, 1951
.
..
■
'
:
•
■
.
Continued from
first
page
Utilities Continue
three months of the year. Of spe¬
cial note was the switch in senti¬
the
toward
ment
stocks which
Prospectus
your
investment deuler,
NATIONAL
RESEARCH
from
request
upon
from
or
SECURITIES
the
among
rail
steel
and
previously had been
prospect
Korea
and
ments
in
of
Mutual Funds7 Favorites
truce
a
threatening
Iran
cast
over
confusion
Also in pronounced disfavor were
the auto and auto parts companies
and the amusements.
&
the
ter,
as
the
in
develop¬
shadows
outlook
of
for
issues. business and the stock market.-
popular
most
"Admittedly,
uncertainties
there
in
are
many
the
present eco¬
nomic and international situation.
This is in marked
ernments.
trast to the previous
only 13,
drew
con¬
period when
21%, of the companies
on
their liquid
re¬
or
down
But
serves.
cash
such
was
necessarily employed
to
purchases of
stocks.
example,
common
increase
and
sizable
senior
your
from
-
investment dealer
or
PHILADELPHIA
2, PA.
Tri-Continental,
of
amounts
issues
added
better-grade
their
to
portfolios.
Lehman Corporation, as also noted
in
our
down
survey
its
on
ago, draws
realized from
year
a
cash
capital gains at this
time
to
the
of
economy
the
country
Oils,
steel
issues
and
prospect
for
continued
for
a
over-all
the
balance
business
of
high
activity
rearmament
1951
level
pay
A
of
the
as
-gains
program
;
similar theme appears in
the
manner:
In
like
manner
President
Funds
of
March
June
as
that
servative
up
year,
is
a
the
two
first
a
the
over
West
Virginia
Coal
and Coke by Nation-Wide Securi¬
ties; Diamond Alkali added by
Wellington Fund; Calvan Consoli¬
months
recent
two
Investment;
policy
possible: "The management
of your Fund has
pursued a cau¬
policy
.n
Axe-Houghton
funds;
Company by Axe-Hough¬
ton
Fund
"B"; Todd Shipyards
Corporation
by
Commonwealth
now
tious
62.6%" 1
f
1951
29, 1951.___.__- 56.4%
Kendall
built
of
venturesome
more
the
to
con¬
been
half
,
following
less
familiar
issues;
Buckeye Pipe Line acquired by
Axe-
explains
while
position had
during
Axe,
,
Investors
the
*
68.3%Mil
Newcomers to portfolios
during
the current period included
the
1
Emerson
30, 1950__
31,
the
New Portfolio Additions
operating pub¬
Republic
well
as
since
in the following"
vV;:Vv,;v1
December
Chrysler
.
reduced
and
sold during the current quar¬
ter and the proceeds
partly rein¬
utilities.
steadily
first of the year
were
nature,
is
been
into
when such action appears to be in
the best interest of shareholders."
fundamentally inflationary in
Houghton
Funds,
so
that the most likely
stockholders
are
no¬
American Business Shares,
Fund, Capital Administra¬
tably
tion
in
For, strength."
companies,
several
not
Boston
prospectus
securities
readily
holdings if
stock
,
their balances of net cash and gov¬
.
conservative
converted
vested in Southern
further time for
Approximately half of the funds business irregularities to be ad¬
in this survey decreased justed, the basic forces at, work
itML
be
common
lic
some
covered
%ELUNGT0N
more
can
It is believed, however, that while
Cash Decreased
120 BROADWAY, NEW YORK 5. N. Y.
■■■■■■pilllBMfl
The
it will take
CORPORATION
/
''"i
Oil and
dated
Gas, Ltd., and Na¬
report made by because of the cross-currents that
tional Tea by the
Bowling Green
Brown, Jr., Present of have developed. In particular it
Fund; Guantanamo Sugar by Re¬
Fundamental Investors: "There is
has believed that a change in the
public Investors Fund; and Buf¬
every indication that the govern¬ international situation
might mod¬ falo Electro-Chemical
purchased
ment
is
committed
to
a
long- ify substantially the outlook for
by Lehman Corporation through
term defense program and heavy different
industries and securities
the Alien Property Office.
'
spending, regardless of the nego¬ The
current
periodic
Edmund
management
tiations in the Far East.
gests
This sug¬
high rate of production in
a
its fiscal year-end dividend.
Thus, heavy industry and high personal
despite the number of companies incomes for the foreseeable future.
lessening
their
cash,
the
total Expenditures for armament feed
that
ever
now
the
these
believes
how¬
The
uncertainties
two
next
funds
quarters
be
can
of
invested
favorite
are
utility issue with
trust managements
diminishing and that during
riod
1951
during the pe¬
premier blue chip,
the
was
the -American Telephone and Tele¬
advan¬
graph
Company.
Seven
funds
tageously."
The
percentage
of
into the economy without Republic's
acquired a total of 30,000 shares,
assets
in
common
common
stocks on
balance
was
creating an equivalent supply of stocks and the more volatile
four making initial commitments.
pre¬
slightly less than during the previ¬ civilian
goods.
Thus
military ferred equities and bonds had
Liquidation of
400
shares
ous quarter.
Those companies that
apspending tends to be inflationary
did purchase the junior equities on
by
generating competition and
balance, however, generally bought hence
higher prices for the avail"
in
heavier volume
than
during able civilian goods." .
funds
the
using
March
cash
to
buy
period.
Over-all
pur¬
transactions
chase
by
this
exceeded
sales
35%,
contrasted
with
15%
earlier in the year.
eral
FUND, INC.
belief
on
request
a
war
FRANK L. VALENTA &
CO., INC.
52 Wall Street, New York 5, N. Y.
Telephone
T eletvpe
N Y
1-3125
in
economy
economic
of
its
scene
the
during
current
the
year,
first
Francis
Randolph, Chairman of the Boards
of Broad Street Investing
Corp.,
National Investors, and Whitehall
Fund, ends
on
of the Delaware
of
the
effects
a
Fund, reported to
"In anticipation
note
of inflation
in his board's semi-annual
report
to stockholders: "In the
report to
shareholders for the .first quarter
of
rearmament
business, employment, and
ings, and ultimate prices,
management
of the
decided
onslaught
a
now
gradually
anticipated strength.
Thus, with a brief survey of the
half
WHitehall 4-6120
reports of
continuing infla¬
tionary trend fed by the fuel of
reaching
Prospectus
several
investment company management
serve to
reiterate the quite gen¬
NATURAL
RESOURCES
to
And on July 16 from Philadel¬
phia, W. Linton Nelson, President
his shareholders:
Inflation Taken Into Account
Reference
cash
earn¬
ment
change the Fund's invest¬
policy to one of full invest¬
ment
in
vertible
lieved
then
would
and
common
stocks and
prior securities.
earn
give
that
the
best
future capital profits.
has been adhered to
It will
be continued
evidence
more
that
date
rearm
be¬
chance
ever
than
since.
we
see
have
to
will
we
national
our
to
has been changed."
excessive inventories
and
sizable
Custodian Fund;
Certificates of
price cutting have become increas¬
ingly apparent.
Late in the quar¬
many
for
defensive
Trustees'
your
an
current
added
.
Soccud quarter reports noweffects
being
reveal the highly variant
controls and volume
having
dividend-paying ability
future
within the
program.' During the of the Fund's assets has been in¬
second quarter adjustments in the vested in cash and the more stable
form of unsettlement in
This fairly
retail type of securities.
.
45 Food Stocks
New Analyses Throw Into
Sharp Perspective the Op¬
portunities Still Available in Undervalued Stocks De¬
spite the Fact that Most Stocks Are Adequately Valued
This policy
until
Equipment,
Radio and Television
of
armament
trade,
44 Chemical, Drug,
Liquor
37 Motion Picture and Insurance
:
15 Electric)!
policy
a
Others took a more conserva¬
1951, it was pointed out that
For example,
the
'adjustments may take place in tive attitude.
certain lines, but underlying the trustees of the New England Fund
nation's economy at present is the reported to their shareholders on
dominant
force
of
the
capital July 30: "During the first half of
goods boom generated by the re¬ 1951 a considerably larger portion
eystone
17 Utilities
the greatest income
us
us
con¬
We
such
same
are
industrial
the effects
group,
That is why every investor should
editions of Value Line
position reflects
judgment
uncertainties
that
call
degree of stability.
mal
ity,
see
cal,
Drug,
Food
Liquor,
Industries.
Motion
You
Picture
would
and
would
see
already
from the
too
Value Line
high and which still
next
four weeks
Ratings which stocks
•
covered
in
Abbott Labs.
in
Cudahy
Bristol-Myers
General Foods
General Mills
Mead Johnson
National
Parke, Davis
Standard Brands
Rcxall
Drugs
Sterling Drug
American Cyanamid
Swift & Co.
Dow Chemical
Coca-Cola
Cleveland El.
General El.
Maytag
Philco
Radio
United Fruit
Pepsi-Cola
Eastman Kodak
Cclumbia
Monsanto Chem.
Singer
Sylvania El.
Westinghouse
Diversified Investment Fund
Loew's
Schenley
.7,
Paramount
Hiram
Technicolor
Walker
Armour
Warner Bros.
Borden
Zenith Radio
Time, Inc.
(Series S1-S2-S5-S4)
.00 INTRODUCTORY OFFER
Diversified Preferred Stock Fund
(New subscribers only) includes 4
weekly editions of
Ratings and Reports—covering 177 stocks in 14 indus¬
tries.
It includes also a
Special Situations Recommenda¬
tion, Supervised Account Report, 2
Fortnightly Letters
Keystone Company
Congress Street, Boston 9, Mass.
Diversified Common Stock Fund
describing
Dairy
Canada Dry
du Pont
Corp.
Servel
COMMON STOCKS
ten
issues
Lchn & Fink
Western Union
(Series K1-K2)
prospectuses
these
are:
Detroit Edison
Fundamental Investors, Inc.
PREFERRED STOCKS
me
are
offer good value.
Commonwealth Edison
Manhattan Bond Fund, Inc.
your
and
inflation,
control, war orders and higher taxes on
earnings,
dividends and probable future
prices of each stock.
You
American Tel. & Tel.
(Series B1-B2-B.V-B4)
Please send
widely.
Insurance
the effects of
see
price
Cutler-Hammer
50
vary
the 48-56 page
price expectancies of some 170 stocks in the Util¬
Electrical Equipment, Radio and
Television, Chemi¬
American G. & E.
FUNDS
price
Ratings and Reports that will be
during the next four weeks. They will bring you
specific estimates of earnings, dividends, and 1951 nor¬
the
BONDS
The
taxes,;
issued
Among the major stocks
investing tlieir capital in
released vividly
that
the earnings, and the
of your stocks.
Even
on
.
Participation in
INVESTMENT
Survey
on
to
rea
of
t
Ratinys Reports
time
southern Ko¬
on
The Value Line investment
New
your
the
at
on
and 4
Organization and the shares of your
Weekly Supplements.
Plus the 48-page edition
Funds.
on
(Annual subscription $95.)
Electrical Equipment, Radio and
on New 195 J
Taxes
Utility Stocks and the Commentary
PROSPECTUSES
AVAILABLE
ON
THESE
Name
FUNDS
Send
$5 to
VALUE LINE
Address...-.
48 Wall Street
.New-York
City
MUTUAL
Hugh W. Long
5
and
Company
Incorporated
State.
Chicago
Los Angeles
investment
Survey
Survey Building, 5 East 44th St., N. Y. 17, A. Y.
ARNOLD
O 5
New York
Value Line
Dept. CF-5
BERNHARD
&
CO.,
INC.
Volume 174
Number 5038
The Commercial and Financial Chronicle
19
(611)
Another issue to be well which completely eliminated the review, four trusts
a single portfolio. Tele¬ sales.
adding 12,300
phone had been one of the fa¬ bought, while at the same time issue from their portfolios. Four shares.
One portfolio elimina¬
vorite issues in the first quarter aided
through
distribution
of additions to holdings amounted to tion equalled 1,100 shares.
An¬
of the year, but only four trusts rights,
was
Public Service of 28,000 shares. Iowa-Illinois Gas other popular issue was Pitts¬
made purchases. Ohio Edison was Colorado, 12,790 shares of which and Electric was the
only other burgh Consolidation Coal, four
also one of the best liked utilities were added to five portfolios; one power company in which sellers
companies making purchases to¬
during the period -under review, sale totaled 16,700 shares. Seven predominated. Three trusts solcb taling 8,900 shares, two of which
additions of the stock' of Florida 8,300 shares, two
although acquisition of some of
completely re¬ represented initial commitments.
this stock was stimulated by the Power and Light were in part the moving the stock from their in¬ One block of
3,800 shares was sold.
exercise of rights. Additions were result of a distribution made by vestment k lists.
One
purchase American Smelting was a fourth
made to eight portfolios, one rep¬ Electric Bond and Share. Acqui¬ equaled 3,000 shares.
Opinion was non-ferrous metal issue to be
resenting a new holding. There sitions amounting to 10,576 shares divided on Middle South Utilities, bought by four managements dur¬
were
no, j sales.
General Public had no offsetting sales. A number Which was the top favorite during ing the
period; there were two
Utilities was also given top bill¬ of power and light issues were the first three months of the year.
offsetting sales.
AIT three pur¬
ing, although in this instance also each added to three portfolios. Currently there were two trans¬ chases of Cerro de Pasco were
many, of the purchases were made These were Atlantic City Electric, actions on each side of the mar¬ newcomers
to
their
respective
States
by present stockholders through Gulf
Sentiment was also mixed portfolios.
Utilities,
Kansas ket.
Additions
equalled
the
exercise
of
rights.
Seven Power and Light, Long Island on North American, although in 10,700 against a
single sale of an
trusts acquired a total of 11,134 Lighting, Minnesota
Power and total volume, sales were four times inconsequential block of 50 shares.
shares. Four funds bought 65,400 Light, New England Electric Sys¬ purchases.
Also
finding favor with three
shares of Public Service of In¬ tem, New England Telephone and
.Aluminium, Ltd., was one of the managements each were Consoli¬
diana.
A block of 1,200 shares Telegraph
and
South
Carolina top favorites in the non-ferrous dated- Mining and
Smelting of
constituted the only sale.
metal group as during the
Vir¬ Electric and Gas.
pre¬ Canada and St. Joseph Lead.
5,700
vious quarter. The four purchases shares of the
ginia Electric and Power was an¬
former and 4,175 of
Utility Transactions
other
issue
the
of -3,400 shares
popularity
of
made currently, the latter were added to
port¬
Southern Company was the most
which was stimulated by distri¬
however, did not match the six folios.
Two small purchases of
bution of rights.
Seven of the heavily sold utility stock during additions totaling almost 22,000 American
Metal totaled
800
nine purchases of this issue were the second quarter of the year. shares
of the earlier period. shares.
•,
peared in
-
DELAWARE FUND
i
DISTRIBUTORS, INC. I
52 Wall Street* New York 5 j
,
;
made
of
Seven managements disposed of a
these
rights;
there
no
were
Kennecott
total
in entirety by the exercise
during
of
88,400
shares,
five
of
also
was
the
three
well
months
Quarterly Periods, March
and
June,
Net Cash & Gov'ts
Thous. of Dollars
End of
Open-End Balanced Funds:
American Business Shares
7.8
23.3
49.5
12.5
72.3
58.4
1,567
8.4
5.1
20.2
23.7
71.4
71.2
9,039
5.648
14.1
8.4
25.2
33.1
60.7
58.5
4,017
3,047
13.2
9.2
16.0
18.3
70.8
72.5
121
4,978
2,371
159
19.1
23.1
24.8
15.1
56.1
61.8
4,766
2,918
7.4
6.9
27.2
29.4
65.4
63.7
41.5
50.5
10.2
9.8
48.3
442
460
18.7
20.4
4.4
2.6
76.9
77.0
6,689
222
5,898
2.6
2.2
31.7
30.3
65.7
67.5
258
22.3
22.2
14.9
13.6
62.8
109
100
6.3
5.5
33.3
37.0
60.4
709
468
3.2
2.2
16.5
19.9
80.3
77.9
3,312
5,554
7,501
17.4
19.8
29.6
29.7
53.0-
50.5
; 13.6
>11.9
18.0
20.5
68.4
402
406
6.8
6.9
71.2
72.2
35,625
28,998
21.5
16.9
17.5
20.3
61.0
62.8
188
98
10.9
5.2
43.3
46.6
45.8
48.2
583
555
16.3
14.9
5.4
5.4
78.3
79.7
—
3,830
4,486
3.2
,3.7
0.2
0.2
96.6
96.1
_______
200
202
26.9
27.3
4.8
6.8
68.3
65.9
1—,——
11,829
2,127
1,710
1,557
11.1
7.7
1,920
15.4
17.6
•
-
—
Fully Administered Fund—Group Secur.
General Investors Trust
Mutual
.
—
Johnston Mutual Fund
^Mutual Fund of Boston
—
National Securities—Income
:
JNation Wide Securities
George Putnam Fund
.
2,902
6,319
—
f
Clark—
Scudder-Stevens &
Shareholders Trust of Boston.
Wellington Fund
—
Whitehall Fund
Wisconsin
-
Investment Co._______—___
21.6
f
t
23.4
22.0
20.9
{
Fund
——
Bowling Green Fund-...Blue Ridge Mutual
Fund
Broad Street Investing——
Bullock
■
____—,
Funtr
67.6
t
Dividend
Shares
;
-
,
Eaton & Howard Stock
55.0
First Mutual Trust Fund-:
Fundamental Investors
Group Securities—Common Stock Fund
Incorporated Investors
—___
0.5
0.5
84.1
1.3
4.1
1.6
93.2
I.8
None
85.4
81.5
88.0
97.1
:
11.3
>12.0
0.7
None
88.0
8,498
7.3
16.4
2.5
2.4
90.2
81.2
47
2.0
1.5
62.7
61.2
35.3
3,081
3.3
1.4
1.6
94.4
95.1
1,707
21.5
13.2
None
None
78.5
86.8
111
5.4
6.2
None
None
94.6
93.8
6,530
7.1
6.6
None
None
92.9
v
37.3
4.2
93.4
122
837
5.3
37.5
None
None
94.7
17.1
18.5
None
1.0
82.9
Management Fund,—349
4,607
2.8
2.6
0.2
1.2
97.0
Putnam Fund Distributors. Inc.
50 State
Street, Boston
80.5
327
Prospectus upon request,
62.5
2,573
Investment Co. of America——
Investors
FUND
81.9
2,257
Shs.-Stock & Bond Group
Institutional
:
PUTNAM
80.5
18.5
3,111
77
7,140
--
SYie t§e
86.5
2.7
'
General Capital Corp
■-
85.0
12.8
69
3,829
—
-.:yx:
_
f>.8
: 112
3,544
Fidelity Fund
;
None
New York,
57.5
*3.9
-
Established 1804
One Wall Street
64.2
i
17,019
1,093
238
11,982
930
Delaware 'Fund
19.5
CALVIN BULLOCK
39.7
Open-End Stock Funds:
Affiliated
your
investment dealer or
46.8
6.4
974
Eaton & Howard Balanced Fund
Investors
June
29.1
ffDreyfus Fund
•
UA—
March
29.9
Commonwealth Investment
(.'•
Pro&pcctut from
—
-EiUU
June
21.3
Axe-Houghton "B"
Boston Fund
■
March
42.7
3,308
Axe-Hough ton Fund "A"_———
•v
June
10,589
4,712
_____
■
;;
21
Percent
-End of-
March
page
Com, Stks. Plus Lower
Grade Bonds & Pfds.
Per Cent*
-End of-
June
March
15,486
.
on
ap-
Companies
Preferred Stocks
Per Cent
—
was
1951
Invest. Bonds &
Net Cash & Gov'ts.
selling
Continued
under
Balance Between Cash and Investments of 61 Investment
End of
1
.■■■.;
Concentrated
liked
Knickerbocker Fund
t
f
Fund———-
Mutual
Loomis-Sayles
5,301
30.5
35.2
12.2
3,595
—
35.0
37.6
12.1
96.2
11.4
57.3
53.4
11.0
'
52.9
51.4
4,076
33.9
36.2
11.0
9.5
55.1
54.3
Massachusetts Investors Trust-_____—
10,716
7,764
2.8
2.0
None
None
97.2
98.0
Fund——
475
849
1.8
3.0
None
None
98.2
97.0
—
144
235
16.5
24.1
31.8
28.9
51.7
47.0
None
96.8
97.3
9.0
65.1
60.3
Loomis-Sayles Second Fund
Massachusetts
Investors
2nd
Mutual Investment Fund-
Investors
National
701
——
New England Fund
Republic Investors
■
Wall Street
0.2
30.7
11.4
,
1,183
20.6
24.0
16.8
19.6
62.6
56.4
2,017
10.3
10.4
None
None
89.7
89.6
14
0.9
3.4
6.8
6.0
92.3
19,337
22.9
21.2
None
0.2
77.1
522
509
21.5
18.6
2.2
0.8
76.3
3,340
1,240
2,804
6.9
5.8
i.8T
1.7
91.3
92.5
1,019
11.4
9.3
8.3
9.1
80.3
81.6
1,658
1,260
7.5
5.6
2.6
2.5
89.9
91.9
76.1
a#
16.4
82.1
81.0
4
___
State Street Investment
2.7
23.5
2,045
Shares
Sovereign Investors
3.0
1,265
21,037
:
American
Selected
670
935
897
Corp.—
Investing Corp
'
■
90.-3
78.6
"
80.6
Closed-End Companies:
Adams Express
American
,
American
International
Blue Ridge
>
—
____
Securities-—-
European
Corp
Capital Administration
--.
——
General American Investors.
General
Service-——
Public
♦#
—
Corporation
National Shares Corp.—
Lehman
Tri-Continental Corp.—
§U. S. and Foreign Securities.
U. S. and International Securities
23.9
**
None
838
—
—
.
245
8.9
2.6
9.0
7,630
1,167
*14,060
1,430
6,866
7,016
16.4
14.9
5.4
5.2
78.2
79.9
1,352
9.6
11.5
None
None
90.4
88.5
8,999
3,231
11.9
7.7
2.3
2.3
85.8
90.0
12.3
27.3
8.4
7.6
79.3
65.1
2,372
2,418
5,724
5.0
1.7
II.9
14.8
83.1
83.5
5.9
4.8
None
0.8
94.1
94.4
10.7
10.5
0.4
0.8
88.9
88.7
7,353
2,889
5,607
Prospectus on request from
your
investment dealer or
TELEVISION SHARES
__
♦Investment
Ba
for
lents
this
in
Bonds;
date.
tMarch
Fund.
and
FitcK's
for preferreds.
subsidiary
Berg
Bonds
or
preferred
AAA
stocks:
through
BE and approximate equiva¬
tNo interim reports issued to stockholders on
figures revised.
IPortfolio exclusive of securities
associated companies. UName changed from Russell
♦♦See
Blue
Ridge
Mutual
Include those of Blue Ridge Corp..and
ttName changed
Moody's Aaa through
from
Nesbett Fund.
Fund
the assets
of which
Change
SUMMARY
in Cash Positions of
Open-End Companies:
Balanced Funds
Stock Funds
—————
Closed-End Companies
60
Investment
Plus
Minus
5
12
15
2
22
MANAGEMENT CO.
Companies
Unchanged
Totals
3
7
5
27
9
2
13
28
10
60
Central States Electric Corp.
Totals—All
Companies-,
135 S. La Salle Street
20
Chicago 3, Illinois
20
The Commercial and Financial Chronicle
(612)
Thursday, August 16, 1951
.
..
W>«, 0>~
Changes in Common Stock Holdings of 43 Investment Management Groups
(March 31-June
Transactions
in which
29,
1951)
buyers exceed sellers—or sellers exceed buyers—by two or more management groups. Issues which
managements sold than bought are in italics. Numerals in parentheses indicate number of managements making entirely
more
purchases
new
eliminating the stock from their portfolio.
completely
or
Corrected Notice
11th
dividend of 15
from
cents
a
Shares
share,
;
investment income,
payable August 28, 1951, to
4(1)
shareholders
7(2)
28,200
1(1)
6,000
Trusts
4
Tripp
8,800'
None
4(1)
Deere and Co
5(3)
2
800
3(2)
4
1,000
10,700
3
11,900
5,700
Climax Molybdenum
Consolidated Mining & Smelting
3
4
12,300
Kennecott
4(1)
4(2)
14,200
™
Aluminium, Ltd.
American Metal, Ltd
American Smelting & Refining
Cerro de Pasco Copper
5,900
-
9(5)
None
2,700
1,000
Caterpillar Tractor
Auto and Auto Parts:
5(1)
4(2)
Borg
Warner
Chrysler
31,200
...
—
__
__
...
-
None
<?■:
Doehler-Jarvis Corp.
4,900
None
__
___
Thompson Products
6'00
2
2
Studebaker Corp.
►3,000
12,200
General Motors
__
None
None
None
Libby-Owens-Ford Glass
1,900
2(1)
3
Chicago 3, Illinois
3
1,500
2
-
3(2)
2(1)
2,500
Grumman Aircraft
0ND«nd PREFERRED STOCK FUND
1
geg=
c€omfiem€cn PiTmids
2
1,500
2,900
Douglas Aircraft1
1
800
American
Airlines
8,200
3(1)
4,900
__
4
Lockheed
Aircraft
—
_
3
Beverages:
2(1)
* M.N D
J-
4(2)
None
National
None
Corp.-Seagrams
Distillers
Your Investment Dealer
or
From
800
3(2)
10,800
2(1)
2(1)
None
None
MWRPHIYFAVRfclNC.
INVESTMENT BONDS «STOCKS
Sherwin
—
None
—
None
Flintkote
23,700
Pittsburgh Plate Glass
26,000
100
United States Gypsum
5,500
6,000
Steel
United States Pipe & Foundry
Weyerhaeuser Timber Co.
2
Allied Chemical and Dye
9,700
600
Columbian Carbon
Dow
12,205
Chemical
2,100
Monsanto
8,900
.
Union Carbide
300
_
1—.
...
and its
12,500
Koppers Company
2,200
Chemical
office,
or
SHARES,
INC.
Dept. C
I
<
I
\
,
I
Exchange Place, New York 5, N.Y.
Send me, without obligat
ion, Prospectus
for Knickerbocker Fund.
I
I
i
;
I
2(2)
4,600
Emhart Manufacturing
3
10,400
1
13,000
/
•
—;
Sterling Drug
.
Merck
Co
and
9,100
3(1)
4(2)
2,700
Texas Company 1
1
None
9(2)
700
r
;
500
1
None
:
Electric
4(1)
4,500
Food
Products—
-
Chemical
or
Bank
Fidelity-Phenix
American
Gas 8c
Electric 5
Telephone & TelegaAtlantic City Electric
Brooklyn Union Gas
Cleveland
Electric
Chicago 3, Illinois
Broadway
New York 6» N. Y.
&
Trust
None
None
None
None
10,576
None
None
'6
:
11,134
General
None
None
3(2)
27,700
Gulf
None
None
3
14,800
Kansas Power and Light
3(1)
35,600
-
Gas
&
Fuel
Public
States
Utilities 9
Utilities
_
2,500
Kl)
Long Island Lighting..
None
None
3,500
Minnesota Power & Light
None
None
6,200
Montana
None
None
7,400
New England Electric
System..
None
None
4,400
New England Gas & Elec. Assoc.
None
None
5,450
New
None
None
3,000'
Niagara Mohawk Power Corp.
None
None
Ohio Edison 7
None
None
None
None
3(3)
>'
8(1)
14,750
4,000
General Mills
2,500
Swift
Fire
Insurance
3,700
United
7,000
Wilson and
England Tel. and Tel.
Oklahoma
Gas
and
Electric.
Public Service of Indiana
None '
None
I 3(1)
48,000
South Carolina Electric & Gas..
None
None
10,750
Texas Utilities Co
None
None
None
None
"None
None
None
1
None
2
•
"
2(1)
1,000
Co
Financial 6-3223
REctor 2-8356
Teletype: CG 1141
TTYpe:NYl-3347
W&
Utah Power and Light
None
None
4(2)
5,350
Wisconsin
27,345
3(3)
KD
3,000
Iowa-Illinois Gas & Electric
None
None
2
8,400
Paramount Pictures Corp
None
None
1
1,000
Twentieth Century-Fox Film
44,100
3(2)
United
36,400
4(2)
23,600
None
Electric Power
National
2,800
1
None
v
1
8,300
88,400
Southern Company
3(2)
7(5)
Radio and Amusement:
None
None
"
None
Paramount Theatres
None
None
Railroads:
4,300
Chesapeake and Ohio
2(1)
Equipment:
—
6,000
Louisville
and
500
Nashville
1
None
None
None
None
None
——
Machine
Halliburton Oil Well
4(3)
26,500
2(1)
1,700
Atchison, Topeka & Santa Fe„_
3,800
4
1
2,800
Canadian Pacific
7,500
4
None
None
None
None
None
-V——
11,300
5(1)
2
7,600
3(1)
None
Dresser Industries
-
None
None
Tool......
Supply
Sundstrand
Allis Chalmers
300
None
10,800
None
None
28,000
Virginia Electric & Power 11
None'
600
4,100
1
9
None
1,400
2
...
1
1,200
None
<<>
None
Co.__—_
and Industrial
7,100
2
16,700
None
—
Fruit
Belt
Co.
None
Dairy Products
and
Co
Public Service of Colorado19...
4
National
Power
12,790
3,000 ;;
General Foods _L—z
3,600
2
pi
m4.
None
Eastern
Florida Power Corp
Florida Power & Light 8
3(1)
115
None
6,000
2
Inc.
135 S. La Salle St.
None
3,600
2
Products:
Link
None
None
,
65,400
National City Bank of N. Y. 8__
4(2)
None
:
Illuminating
4(1)
Commercial Nat. Bank & Trust4
3(1)
1
None
None
None
3(1)
Principal Underwriter
None
None
■2(2)
1
67,887
Machinery
400
Commonwealth Edison (a
4
None
3,000
HUDSON DISTRIBUTORS
2(1)
None
American
1,500
1
1,400
Irving Trust
2(1)
$
6,100
5-
Commercial Credit __l
3(2)
authorized dealer
1
2(2)
None
None
Chase National Bank
2(2)
Prospectus may be obtainedJrom
1,000
5,500
.
3,800
3(1)
1,400
24,700
2
None
3
14,600
Electric
3(2)
Open-End Investment
Company
Corp. 7__
2(1)
Financial, Banking and Insurance:
3(7)
Gas
; ,2(i)
3(1)
10,000
Zenith Radio
40,800
United
Transmission
None
None
2
-
Westinghouse
3(1)
Eastern
2(2)
None
3
19,810
1,500
26,000
None
Sylvania
2(1)
21,800
Gas
'
None
29,400
4,100
None
None
Radio Corp. of America
10,000
None
None
Natural
8,000
:i
None
Motorola
3(1)
None
Texas
Oklahoma
2
56,100
2(1)
Panhandle Eastern Pipe Line
Shamrock Oil and Gas
■k3(l)-:
Dumont
3,300
American Natural Gas 6J-_
37,106
30,600
,3(3)
V 2(1)-
None
1,900
10,400
2(1)
;
-7(4)
V
6
36,589
1,400
3(1)
c
f
26,700
44,300
Gas:
Mississippi River Fuel Corp
Electrical Equipment:
10(4)
your
4(1)
34,500
Oil
None
;
None
—
6(3)
An
27,000
Oil
Shell
Public Utilities:
4(1)
'
5(1)
5(5)
Pure
None
v
:
None
12,350
i 7(2)
10(5)
u
25,500
1
None
1,100
1,000
Lone Star Gas—.
5
4(2)
State
None
...
Exploration
Development Co.______
Mission
KD
4(1).
1,400
Producing
Land and
None
Address
City
Texas Gulf
Louisiana
None
30,400 ;
...
14,600
None V
■:[£xr" I
McKesson and Robbins 2.
1,000
2(1)
_
Standard Oil of California
6
;
None
3
I
I
Socony Vacuum
1
None
2,000
—
10,000
500
Bristol-Meyers
3,450
3(2)
-
2(1)
None
Continental Can
Drug Products:
I
I
1
Corning Glass Works
I
Name
I
3,800
3(3)
__
2(1),;
our
THE COUPON TODAY I--—)
KNICKERBOCKER
I
13,000
send the attached coupon.
_
11,100
2,000
Glass:
3(1)
call at
or
2,000
None
None
_
3,500
i
;
2,700
Mathieson
2(1)
shares, phone
(Del.).
\
1
3
;
None
900
10,500
Containers and
For Prospectus,describingthe Fund
Republics Corp.
Seaboard Oil
Ohio Oil
Natural
il
None
Supervision
Safe-keeping of
None
None
3(1)
.<"■
Investments
American
2
v
200
L—P
Chemical
2(2)
and
-
None
5,300
1
for the Diversification,
i
-
None
_
_—
duPont,--.
2,900
3(1)
Fund
4(1)
3
20
500
1
f
4(1)
None
-
14(1)
Knickerbocker
f^MAIL
.
2(1)
■
Chemicals:
2
—
11,100
11,000
4(1)
None
4(3)
1
3(1)
None
3(2)
11,100
None
<
6(3)
'None
Corp
Skelly Oil
1(1)
2(1)
2(1)
5(3)
None
rZESTS*
Zellerbach
McGraw Hill Publishing Co
Signal Oil and Gas "A"
2(1)
.
None
None
None
?J1
Crown
8,000
8(1)
."
1
None
SPOKANE
WASH
8,200
3,700
8,900
-
4
2
1,200
1
tot
Williams
1,000
1,100
...
Lead
Detroit
800
2
None
Products
SPOKANE ANO EASTERN BUILDING
e*TA»utut»
None
Minneapolis-Honeywell
None
29,100
2
3(1)
'
National
1,000
None
1-3,000
National Cash Register
.18,200
4(2)
2(2)
7,100
Glidden
7,966
4(2)
,
1(1),
None
3,200
_.
—
Canada Dry
None
*
2
,
Petroleum:
Distillers
1,200
17,200
Building Construction and Equipment:
Prospectuses May Be Obtained Prom
1
k
Remington Rand
3,700
3(3)
111 COMPOSITE
7,000
2
v
3(1)
6,000
.
-
1
12,500
None
Paper and Printing:
r
...
...
KD-
3,800
International Nickel
5,000
■:
None
1,100
Pittsburgh Consolidation Coal..
St. Joseph Lead
28,000
-1(1)
None
None
..
None
Office Equipment
Aviation:
BH
None
50
Copper
3,700
,
4
None
None
2,000
—
—
8,900
4,175
3
/
y
None
None
of Canada
7(2)
20,400
__
6,400
None
-3,400
Trusts
•
2(1)
J. I. Case
No. of
Shares
Shares
Metals and Mining:
President
135 S. laSolle Street,
Trusts
No. of
No. of
3(3)
record
August 16, 1951.
Chester D.
No. of
Agricultural Equipment:
net
of
No. of
Shares
No. of
Trusts
The Directors have declared
a
No. of
No. of
-Sold-
—Bought—
Sold-
—Bought—
Quarterly Dividend
Cementing
5,200
2(1)
"
Pacific
—
None
Chicago, Milw,. St. Paul &
1,500
;
2(1)
Northern
Great Northern
None
-
8,400
Norfolk and
Southern
Pac.
Western
Railway
.___
400
: 2(1)
11,100
Preferred
■5(2)
8,800
2(1)
6,200
4(3)
Volume 174
Number 5038
.
.
The Commercial and Financial Chronicle
.
(613)
—Bought—
~
No. of
Trusts
*
Shares
-
V
,
Sold
No. of
Continued jrom page 19
No. of
.
/<.
No. of
Shares
None
parent
2(1)
non-ferrous
Railroad Equipment:
4
4,600
General
tion
None
None
American
;
General
Railway
_
Signal
1,500
in
only
Retail Trade:
of
8,400
Allied
2
3,500
Bond
4(2)
18,500
3(2)
7,100
2
Gimbel
4(1)
800
(H.
L.)
Macy
9,200
None
Safeway
Stores....
2(1)
Woolworth
15,000
Federated
Opinion
None
Inland
28,500
1
Jones
19,000
None
pur¬
1(1)
of
shares.
issue
the
in
the
three
year;
of
2,100
shares
two
sales
totaling
well
4
contrasted
2,600
Sentiment
was also
fairly
Phelps
Dodge,
offsetting two pur¬
mixed
three
on
sales
&
4
8,300
525
1,150
~
4
Steel
Industrial
Pacific
17,200
3,400
;
were
Sinclair
'
-•
Rayon
None
Cone
'
t
'
;None
2,750
—
Mills
holdings,
'-'r*
1,100
-4
1
.
-
/
•'/."{ V
^
•.
'[l
'
of
the
year,
was
added
one
8,900
making
Half
initial
many
as
an
trusts
Liggett
and
Reynolds
22,900
Myers
9,700
both
None
News
None
—
and
from
3,700
making
one
of
com¬
initial
an
Another trust
eliminated
its
shares
bought by three
were
pletely
None
company
portfolios. A single
sale was registered in
commitment.
Shipbuilding &
Dry dock
former
issues.
panies,
Newport
the
added to
Skelly
12,100
funds
11,100
of
offsetting
Miscellaneous:
2(1)
four
shares of the latter oil
1
Tobacco—None
issues,
29,100
were
3,000
3
popular
shares
J;
v"v
com¬
the
added
were
to
mitments.
10,000 shares.
of
was
ing
was
11
Balanced Funds
Stock Funds
—
Totals—All
*
2
2
Companies..
7
20
7
12
13
26
Texas
60
After
2-for-l
2
After
10%
split-up.
stock dividend.'
3
Part
4
Surrendered
5
15,940
6
26,197
7
Purchased
through
rights.
shares
shares
8
1,276
9
Purchased
1
share
with
through
purchased
for
Bankers
in
part
through
rights.
received
Florida
in
dividend
as
Power
rights.
for
Bond
12
Excludes shares received
13
Part
as
2%
as
20%
Bond
and
Share.
exercise
of
Basis
year
rights.
stock dividend.
'
;v;
stock dividend.
'
as
five
You
MORE
now
secure
.
Our service
.
save
now
most
.
.
today
Dealer's
of top
program
designed
to
turn
into interest and
prospects into customers ...
it's
a
salesmaker
.
de¬
inquiries
.
signed
to
SERVICE
.
four
same
Selling by
agement of
a
block
negligible.
was
which
one man¬
of 200 shares
Union
Carbide,
the least popular issue
was
of the group
in the first quarterly
period, currently found favor with
three managements.
Purchases of
8,900
offset
shares
were
funds also
the
num¬
ber of trusts took stock into their
portfolios.
single sale of 900 shares.
in
liqui¬
were
shares
added
a
total of 2,900
Monsanto
of
by a
Three
Chemical
being
totaling
single
block
sold.
Four
of
29,400
1,400
manage¬
purchased
Motorola
Radio, 10,400 shares of
added
4,500 of the latter
to
trust
holdings.
holdings.
There
was
no;
liquidation in this issue. The only
26,700 shares of Dumont
were
ume
was
comparatively
,
were
sold
2,700 shares of Koppers Com¬
Opinion was mixed on
pany.
Eastman
Kodak,Vtl|ree»
purchases
sales.
This con¬
trasted with the previous period,
offsetting
two
Continued
HOWE PLAN
on
page
FUND, INC.
Prospectus and Latest
Quarterly Report
Your
Investment
from.
Dealer
or
George D. B. Bonbright and Co.
Members New
York
Stock
Exchange
Rochester, N. Y.
General Distributor
by
25,500
no
off¬
Mutual Investment Funds
on request
jrom
your
INVESTMENT DEALER
Profits
THE
service
.
.
and
or
FUNDS
AXE SECURITIES CORPORATION
attempts to create what
your
.
Avenue, New York 19, N. Y.
salesmen valuable
your
we
use.
.
to
your
spe*
SOVEREIGN INVESTORS, INC.
.
Direct
mail
letters for
Mutual
on
individual
your
Funds.
A MUTUAL INVESTMENT FUND
use.
Monthly Letter and other special studies
to keep you on
top of all fund developments.
Prospectus
on
request
—
5.
The necessary sales tools and
—
to
help
you
exploit the
aids
opportunities
involved.
ARTHUR WIESENBERCER b COMPANY
Members:
N.
61
Y.
Stock
Exchange
BROADWAY
light.
Four companies disposed of a total
of 2,200 shares.
Three funds also
bought by two funds, one of which
Mis¬
liquidated
•
:
NEW
N.
Y.
YORK
Curb
Exchange
6, N. Y.
to
their
was
730 Fifth
.
.
Continuous research and information
4.
5,300 shares
volume, although the
eight
from
totaled
there
Unique sales promotional campaigns geared
CLINCH sales.
Sales
comprehensive
3.
promotional ideas devised to
bring new prospects to your
.
also
was
Greater
spent in
OFFERS YOU
300
of
the
Sell¬
Another management
purchase of 500
Louisiana Land and Ex¬
trusts.
2.
door
A
completely elimi¬
nating the latter issue and one the
you
already perfected for
cific needs.
special
Of
Four manage¬
ments each disposed of Ohio and
Shell Oil, two
the
THIS
ACT NOW!
block
dated in two portfolios.
The buy¬
ing of du Pont was in lighter
quarter
.
will
time and money
1.
small
sold.
initial
shares while
—
have
FUNDS
One
was
were
eliminated
trusts
making initial purchases for port¬
paral¬
by
to promote public interest in the
investment
idea
planned to help you develop new pros¬
and convert their interest into profitable sales.
pects
MUIUAL
three
devised
company
information
there
AXE-HOUGHTON
can
total
a
Allied,
setting purchases.
SAVES YOU TIME AND MONEY
our
commitments
Opportunities For
Greater Sales
ever
full
the
Prospectus
SELL
about
sold
distribution
a
an
ploration
■
,
HOW TO
Service—the
preceding
also
Five
shares.
NOTE-—This -table covers 61 investment companies, but purchases or sales
of trusts sponsored by one management group
are
treated as a unit. For
example, the several trusts sponsored by Calvin Bullock are considered as
having the weight of one manager. Individual portfolio changes of the two
Loomis-Sayles
funds are not surveyed, but
those of Overseas Securities
(which does not appear in the companion table) are included.
Get
was
of
Corp.
made
for 10 original shares*
I
of
ment Co. which had been received
in the first three months of the
held.
10
shares
9,700
12,350 shares of Mission Develop¬
held.
10
sion
22,540 shares bought through rights. Basis:
received
for
the
was
funds.
held.
Share.
and
11
through
15
share
new
Electric
from
9,490
acquired
1
for
new
rights.
10
shares
1
for
1
in
it
held.
4
Basis:
Basis:
each. 100
large part through
leled
when
each
Corp. Sold
performance of Texas
t
Trust.
purchased through rights. Basis:
shares
2.2
Basis:
merger
upon
-
tial
and Zenith
giving effect to the 2-for-l
split in
its outstanding shares,
Texas
Corp. proved to be the
least popular among the oil issues.
Six funds disposed of a total of
44,300 of the new shares.
Three
offsetting purchases were made in
comparatively light volume. This
made
Products
the former and
After
FOOTNOTES
1
much.
as
27
4
22
Totals
12
9.6
—
Companies
Closed-End
Matched
Four funds added
of
also pronounced
selling
among
the
three portfolio addi¬ chemical stocks was in the shares
tions and an equal number of ini¬ of Mathieson Chemical
and vol--
each
Sold
number
same
pronounced
Electric
ments
Bought
less
liked,
was
Companies:
Open-End
were
more
shares
Companies
the
issue, however, four trusts
disposing of 14,600 shares.
Sylvania
each
in
latter
well
Seaboard
com¬
only four original additions.
shares
also
initial
lighter and
shares.
Investment
the
Chemical, Dow Chemical and
mitment.
Westinghouse stock, but total vol¬
ume
Signal
and
The
purchases
of
Securities 60
lied
shares
portfolios, half
Liquidation
liked by two managements.
Pur¬
chases of the former totaled 8,000
Portfolio
from
du Pont.
folios.
holdings of three trusts equalled
list.
were
10
of which represented
Sales
and
chemicals
Oil
56,100 shares of the former issue
shares and of the latter one-tenth
Purchases
Balance
Switching to the buying side of
the
the
quarterly period,
both Radio
Corp. and Westinghouse Electric were well
bought.
Oil
Delaware
trans¬
in
preceding
Nummary
"A"
favorite
Equipments Popular
and
Gas
Oil,
top
Continuing their popularity of
2,000
investment
Gulf
Oil
;
during the first three
quarter), Creole Petroleum additions
to
holdings of Dow,
Phillips Petroleum.
which totaled 12,205
shares, only
one represented an
original com¬
Electrical
shares
making purchases of each.
2
J
i
.
next
2
as
months of the year.
Transactions
in Philco were also mixed.
and
months
American Republics and Standard
Oil of California were the two
None
None
Mills....^..-.-.1—.—^
Electric
March
purchase.
Tobaccos:
3(1)
stock
was
to
3
on
giving effect
dividend, three
offsetting four sales.
100%
in
Socony, although volume of
stock
liquidated
was
sizable.
J. P. Stevens & Co
None
'';
to the
selling
apparent in this group. Opin¬
on General
ion continued divided
the
early months of the year,
investment companies favored Al¬
divided
Continental Oil after
purchases
purchase of this
concentrated
Senti¬
balanced.
likewise
No
friendly attitude displayed during
(which
managements
5(3)
;'-V-
2
"
evenly
was
initial
an
issue.
was
actions
currently the best bought stock in
the petroleum group.
Eight
10(2)
40,800
Steel
Wheeling
,2
•
volume
three
None
38,400
Laughlin
Textiles:
6(3)
Total
either side of the market
ment
made
was
by five addi¬
holdings.
Similarly indecisive
sold
None
offset
were
to
Socony Vacuum, one of the less
popular
issues during the first
None
None
Steel
National
None
None
Steel
Bethlehem
500
2(1)
creases
almost
with
Crucible Steel )3
2,100
6(1)
One complete
portfolio elimination and five de¬
chases.
1,836.4
2
Oil of New Jersey.
tions
quarter
Steels:
2
Reynolds
Sales of Shell equalled
9,100 shares and of Ohio Oil, 27,000 shares.
After giving effect to
the stock split-up, opinion was
fairly well divided on Standard
on
chases
3,340
on
former.
first
2(2)
Stores 12
divided
was
popular
None
6,000
a
Mutual Funds' Favorites
as
most
None
__i__
Department
^
-
Metals which had been the second
53,900
.
Western Auto Supply..—_____
51,300
3(2)
1
' 1(1)
500
18,900
"
None
1,000
...
Co
the
trusts
which completely eliminated this
stock from their portfolios.
Two
purchases equalled 3,700 shares.
2
None
_—
Brothers....
Green
2,000
2
Stores.
Stores
Six
total of 7,000 shares
International Nickel, three of
.
5(1)
issue of
one
group.
disposed of
V<
'
Utilities Continue
Transporta¬
________
'
'
Trusts
None
.
21
George A. Bailey & Co.
NATIONAL DISTRIBUTOR
845 Land Title
Bid*.
«
Philadelphia 10, Pa.
22
The Commercial and Financial Chronicle
22 '
stock dividend,
effect to the 10%
Continued jrom page
21
3,750 shares of McKesson & Robbins were added to the holdings
Merck
issue in
sellers predominated was
& Co. as three funds dis¬
Utilities Continue as
posed
of
which
Mntual Funds' Favorites
however, when Kodak was one
the less popular issues.
Portfolio
commitments.
of initial
aided by the exer¬
cise of rights.
There were no
sales of this issue nor of any of
the other bank stocks in which
additions were
The Merchandising Issues
sitions.
3,200 shares were elimi¬
from holdings of two other
nated
trusts acquiring
1,200 shares. Light activity among
the tobaccos was featured by pur¬
two
Stores was
duplicated
also
Brothers
Gimbel
trusts during the
first
quarterly
period.
Initial
commitments by two funds and
its acceptance by
additions to holdings made by two
shares.
18,500
totaled
others
block of 1,000 shares was
Four companies
of.
total
of
A
disposed
purchased a
shares of Safeway
9,200
Stores, although volume of shares
/sold was much heavier, as two
Among
Three
Woolworth.
manage¬
companies,
preference was shown
Commercial Credit as three
for
companies added a total of 4.100
shares.
One block of 3,000 shares
was sold.
Opinion was mixed on
Financial, two funds buy¬
C.I.T.
ing
1,300 shares and
another
eliminating a round lot of 100
shares.
Among insurance shares,
managements acquired
two
completely elimi¬
shares
nated
53,900 shares from their
Other
portfolios.
For the first time
sented
since the March quarter of 1950,
single
marked buying interest appeared
managements
the finance
moderate
Tobacco.
Popularity in the stock of both
and
Three
Opinion
Corp.
Buyers showed a decided pref¬
erence for the food stocks, which
Fuel
River
Mississippi
and
Gas
divided
was
on
Outstanding favorite among the
as during the pre¬
Three
like
J. P. Stevens
was
purchases and a
number
new
of portfolio addi¬
17,200 shares.
Two
disposed
of 2,750
shares.
totaled
funds
Also liked by two funds each, but
acquired a total of 51,300
comparatively light volume,
was
a
change from the lack of in
shares, two of these making initial
were Pacific Mills and
Industrial
commitments.
One offsetting sale enthusiasm displayed during the
Three Rayon. Cone Mills was lightened
•equaled 6,000 shares. H. L. Green early part of the year.
in two portfolios.
Co. was also purchased by three funds purchased 24,700 shares of
Crown Zellerbach was the only
funds and two of these also repre¬ General Foods, two making initial
ments
There were no
portfolio acquisitions. commitments.
Macy and Western sales of this stock nor of National
Auto Supply were each added to Dairy Products, another popular
Three
purchases of the
the holdings of two companies. issue.
After giving effect to the 20% latter stock totaled 3,600 shares
stock dividend, Federated Depart¬ and two of these represented new
ment Store was the only issue in portfolio holdings.
7,000 shares of
which
there
was
pronounced Wilson & Co, were acquired by
sented
Bond
new
Stores,
managements
while
two
paper
for
company
Opinion was mixed on National
issue among the
Sears
Roebuck
and
Montgomery
Opinion was also divided
which had been
Marshall Field,
the most popular
issue during the
Biscuit.
previous quarter.
Drug
Renewed Interest in
Awakened
York
heavy,
Seven
Bank
three
interest in New
issues
were
featured
by
initial commitments in Bris¬
tol-Myers
totaling
10,400
shares.
while
not One block of 700 shares was sold.
noteworthy. Sterling Drug was also well liked,
acquired a three funds buying 13,000 shares,
bank
is
Stocks
stocks,
certainly
managements
totaled
: Purchases
Belt
was
the
liked
best
acquired by three companies
and Sundstrand
National
the
to
Acme
National
commitments.
Machine Tool and
Supply were each added
holdings of two trusts.
Selling was concentrated on AllisNational two of these making original
Chalmers, five managements dis¬
City Bank, three of these making portfolio purchases. After giving
posing of 11,300 shares. Also sold
total of 67,887 shares of
balance
on
were
Dresser
tries and Halliburton
menting
and
Manufacturing
Food Machinery and Chem¬
in
Joy
Liquors
and Tobaccos Bought
Preference was shown for Na¬
Prospectus arid other information
obtainable from
ucts
of
Teletype SF
which
total of
new
manage¬
Chrysler, five completely elimi¬
the
issue
from
their
Total volume of four
portfolios.
purchases, however, equalled 31,General
Lead,
the liquor
portfolio acqui¬
by
Motors
funds,
seven
was
two
com¬
pletely disposing of their holdings.
Studebaker
met
with
limited
Among equip¬
buyer acceptance.
Formula Plan Inv.
Minneapolis-
in Johns-Manville and
shares.
Management Corp.
l!
(Special
Chronicle)
to The Financial
Armstrong
BOSTON, Mass.—Formula Plan
Cork.
Investment
in the recent atti¬
The reversal
the
toward
rail
issues
featured
by sales of Great North¬
disposed
Five managements
ern.
was
of 14,100
shares, two making com¬
Santa
tion, four trusts disposing of each
of these
issues."
3,800 shares of
of Canadian
Corp.
Management
with
formed
offices
Officers
53 State Street.
at
War¬
are
F.
ren
Burlingame,
President;
W. Roraback, Treasurer;
Grafton L. Wilson, clerk. Mr.
George
and
Burlingame
was
investment
business
formerly
The Burlingame
the
in
of
head
Corp.
Plan
Formula
with
Associated
as
is Ralph A; Alexander.
:\
Pa¬
Santa
Fe,
and
sold.
-
6,200 of Southern were
Three of the saks of the
7,500
been
has
Arthur Peek Governor
last-named issue represented com¬
Chicago
Six
and
purchases
of
sales
seven
North Western.
contrasted
with
most popular
which had been the
issue
was
Opinion
evenly divided also on Rock
early in the year.
Island
which
favorite
been
had
second
the first quarter.
Pacific was still liked
during
Northern
management,
purchasing
by
Pacific,
Southern
trusts
discoveries
to
Of
Chairman
Crooks,
New
York
Stock
the
announced
a
as
has
election of Arthur
the
K. Peck
Exchange,
Governor of the Ex¬
change for the term of one year.
He
the
fill
will
created
Board
the
in
vacancy
election of
by the
as
Chairman last May.
Mr. Peck, a
course,
recent
oil
member of the Ex¬
Mr. Crooks
given a special
rail.
Also liked
on
a
a
specialist
the floor of the Exchange
and
partner of Walters, Peck & Co.
have
this
by purchasers were Chesapeake &
Ohio and Louisville
and Nash¬
ville.
Bethlehem
popular
M.
the Board of Governors of
of
however, four
change since 1930, is
a total of 26,500
shares, three making initial com¬
mitments.
Of N. Y. Stock Exch.
Richard
issue
Robert S. Morton Now
With
among
the other group to
find
the
a
steels,
marked
Dempsey-Tegeler
(Special to The Financial Chronicle)
Steel was the least
LOS
Calif.—Robert
ANGELES,
become
associated
with Dempsey-Tegeler
& Co., 210
S.
Morton
has
Seventh
West
formerly
was
769
Sansome Street, San
Nine
disposed of 14,200 shares of
nating
same
Honeywell, Glidden and SherwinWilliams were each liked by two
funds.
Transactions were divided
funds purchasing a
17,200 shares, two of which
represented
still lacking for
was
issues.
auto
ments
in
part of the year.
Enthusiasm
the
bought
well
been
had
the earlier
lightened in the holdings
number of trusts.
was
the
National
four
stocks,
both of
States Steel and Republic,
ments, Borg-Warner and DoehlerJarvis were sold
-
DISTRIBUTORS
TECHNICAL FUND
Steel, but purchases were not in
heavy volume.
Opinion was
fairly
well
divided
on
jUnited
fairly heavy volume by two com¬
panies while Detroit Steel Prod¬
flavor
tional Distillers among
155
were
ical Corp.
TECHNICAL FUND
f:"
Indus¬
Oil Well Ce¬
Transactions
Co.
indecisive
The
lightened 3,400 shares of Wheeling
Steel.
Two buyers liked Inland
machinery stocks,
plete portfolio eliminations. Also
four funds purchasing 7,100
to find disfavor were Milwaukee,
shares, two of which made intial
and
was
totaled
sold
cific
shares and there were no
Link
their
fromi
purchases
200
Fe, Canadian Pacific and Southern
vied for second place in liquida¬
18,200
stock
the
Six
were
of which
U. S. Pipe and Foun¬
eliminated
from two
other portfolios and decreased in
another.
Sales t o t a 1 e d 6,000
shares.
Flintkote
was
sold in
was
plete portfolio eliminations.
Graw-Hill.
eliminated
issue
two
purchases.
Paper and
International
Among
the
publishing
companies, initial commitments of
three trusts were made in Mc¬
sales.
Ward.
four manage¬
no offsetting
Paper.
2,500 shares of Swift.
One
portfolio commitment was
made of 5,000 shares of Armour.
General Mills and United Fruit
were
each bought by two trusts.
on
were
and
Two purchases totaled
15,000 shares.
Transactions were
mixed and not numerous in both
new
by
There
tude
selling although volume was very
added
sold
also
were
Timber
Weyerhaeuser
of
ments.
there
which
shown preference,
three
light.
this
of
trusts,
holdings.
United States Gypsum, five trusts
three man¬
agements adding 3,700 shares to
portfolios.
Opinion was evenly
divided on Rayonier, Union Bag
was
10
dry
Peoples Gas Light and Coke.
Co.
shares
by
man¬
disposing of 5,500 shares, three of
which completely eliminated the
issue from their holdings.
11,100
of which were pur¬
chased by two funds.
The same
shares
number of trusts sold Lone Star
tions
company.
Oil
Shamrock
and Gas, each
1,500 textile issues
Fire. ceding period
of
Fidelity-Phenix
acquisitions were repre¬
by purchases made by a
Eastern
Texas
were
Transmission
selling side of the market.
38,400
Liggett and Myers and
Reynolds
American Natural Gas and United
issues
the buying
from
28,500 shares. Half as many funds
sold 8,300 shares of National Steel,
agements bought 3,000 shares of three completely disposing of their
40,800 shares of Jones &
the former and a like number of holdings.
companies purchased 22,900 shares Laughlin were liquidated by four
of the latter stock.
Continental companies while three , trusts
chases of
Pfizer
Charles
and
(after giving effect to the stock
split-up in the latter issue).
gas
Invest¬
sentiment"7 among
managers
the
sold
Can was liked by three fuqds, but
Gas Corp. was stimulated through
the favorite
purchases
were
made.
Irving the issuance to shareholders of activity was negligible and evenly
among the merchandising issues,
divided in American Can.
EmTrust was acquired by three funds,
Fourteen trusts acquired hart Manufacturing and Corning
holding well to its popularity of additions totaling 40,800 shares. rights.
stock in the former company and
the earlier part of the year.
Five
Glass were each bought by two
Two
trusts also each purchased
six in the latter.
Three manage¬
managements
added a total of
3,300 shares of Chase National ments added shares of Panhandle companies.
8,400 shares to portfolios while
Bank and
10,000 shares of the
Selling in the building stocks
Eastern Pipe Line and Oklahoma
two sales were in light volume.
was
featured
Chemical Bank and Trust Co.
by liquidation in
Natural
Gas.
Other well-liked
Allied
ment
companies. Also liked during the
period was Distillers CorporationSeagrams,
in
shift
to
Parke Davis, Sharp
on
Dohme,
Opinion
shares.
1,900
mixed
was
&
Only
trusts.
three
of
in
Thursday, August 16, 1951
.
(614)
Street.
Mr.
Morfon
Vice-President
American Funds Distributors,
Francisco 4
of
Inc.
Howard L. Goodhart
srwvwww
VAAAAAAAAA
Lehman
Howard
Goodhart
passed away at the age of 67 after
a
brief illness. Mr. Goodhart had
been
a
Stock
MUTUil; INVESTMENT FU\DS
INVESTORS MUTUAL
Goodhart
RESOURCES OF CANADA
INVESTORS STOCK FUND
member of the New York
&
Co.
and
his
P.
of
until
Exchange,
J.
retire¬
INVESTMENT FUND
INVESTORS
SELECTIVE FUND
ment in
1925.
LTD.
•
F^CE-AtiouNT ('inline nr: company
A
INVESTORS SYNDICATE OF AMERICA
participation in the
A Balanced
Mutual Fund
growth of Canada's natural wealth.
COMMONWEALTH
INVESTMENT
Prospectnses of these companies available at offices
in 148
principal cities of the United States
or
from
.
Prospectus
on
pr
INVESTORS DIVERSIFIED SERVICES, INC.
1932
request
the national distributor.
MINNEAPOLIS
(Established in 1894
COMPANY
ESTABLISHED
>
111
1
as
2, MINN.
Investors Syndicate)
Prospectus from Investment
or 2500 Russ Building
RECAN SECURITIES DISTRIBUTORS
LIMITED
275 ST. JAMES STREET WEST
MONTREAL
Dealers
I
IP
San Francisco 4,
California
| |
Volume 174
Number 5038
The Commercial and Financial Chronicle
.
.
.
i
l
(615)
Continued from first page
World Bank Reports
Increase in Income
As
The International Bank for Re¬
a
cal
ended
year
§15,156,947.
Net
preceding fiscal
§13,698,398.
Gross
year,
for
vided.
of
exclusive
$28,202 542
$13,-
cial expenses.
June 30, 1951, this reserve
was
and
commissions for
credited
for
serve
ligations
cles
to
to
Total
1951.
were
$20,125 748
reserves
loans
bringing
ments
Bank
to
and
commitments
loan
to
others
than
the
Bank
in
June
30,
in
the
last
(68.6%)
States
Of disbursements
$53.3
year,
million
spent in the United
$24.3 million (31.4%)
were
and
in other countries.
At June
49
000.
capital
The
duced
Bank's
by
$125
withdrawal
and
of
capital
to
which
Poland
by
the
1,250 shares
million
with
had
subscribed.
the
admission
of
Ceylon and Pakistan.
All mem¬
ber countries which had received
deferments until June
25, 1951, of
of 1% on capital stock
subscribed, payable in
ox;
on
full
gold,
or
U.
balance
this time.
further
its
$2,970,000
unpaid
Bank
of
Agreement,
balance
has
not
under
of
tures
on
on
principal
were
amount.
These
made to purchasers
in
earlier.
These
3%
consisted
of
25-year bonds in the
States
and
£5,000,000
•equivalent $14,000,000)
it
United
3V2%
S.
25-
year
sterling stock in England.
Also, early in July, 1951, the Bank
sold an
issue of 3^%
12-year
Swiss franc bonds in Switzerland
in the principal amount
of Sw. fr.
50,000,000 (U. S. equivalent about
$11,600,000).
con¬
budget
indeed to
public interest
But then the popular com¬
upon
as
I
defense
to
expenditures
types of outlay. There is altogether too
tendency to regard defense outlays (as defined
by
the politician for his own
purposes) as sacrosanct. Quit©
without regard to what needs to
be done in the name of
defense, it is safe
to say that we
regularly waste more
consequently labor and materials) in obtaining
money (and
unit of defense than---we had almost said than
many
That, too, must cease.
any
other nations
spend.
Public
Utility Securities
By OWEN ELY
Holding Company Securities—Part
Standard Gas &
immediately and at will like a spigot.
is far from the truth. Outlays scheduled
are
only do
we
have continuing appropriations,
been
possible to call
expended.
a
halt without losing what has
Congress is now doing or seems to be in the
of doing is to place itself in a position where two,
or more
near
be made.
years hence it will be unable to effect any¬
the reduction in
public
spending that should
It is
making commitments of one sort or another
inevitably tie its hands for years to come.
This it is doing with
hardly a thought about the conse¬
quences, while public attention is largely fixed on matters
which
must
which have to do with defense
outlays and with the im¬
industry and trade. One can scarcely
expect more of the politicians. They are rarely moved to
action except in an endeavor to
placate or to please the
mediate outlook for
electorate.
But is this not
a
matter
III
division
of
common
settle
remaining assets between the second preferred and
Recently a separate plan was announced to
stocks.
all
Gas and
however,
of
inter-company claims and problems between Standard
its inactive
parent, Standard Power & Light. The
latter,
has not announced any plan of its own for
allocation
be deferred until the Standard Gas
plan
further. Standard Power &
Light holds both
assets, and this
has
a
progressed
may
1st preferred and common
stocks of Standard Gas in
together
with
miscellaneous
its
portfolio,
holdings.
The trustee of International
Hydro-Electric filed a plan with
the SEC about two years
ago proposing the issuance of
liquidating
certificates in the ratio of
eight to each share of
;
and
to each share of the Class A.
This
one
well
preferred stock,
plan
now
pretty
seems
out-dated, and various other proposals have been
suggested
informally which have not yet crystallized into a new
plan. Im¬
portant holders of
alive,
company
now
the
so
as
Class
A
stock
seem
anxious
to
keep
take advantage of substantial tax
to
manner
They must therefore devise
stock, and presumably to convert the Class A into
(the original common stock has been
cancelled).
was
American &
the first
same
Corp. hope to do.
to retire the bank loan and the
ways
stock
This situation
Bond &
the
losses
the books and pay future tax-free
dividends, in the
as Electric Bond and
Share and United
on
described in this column in the April 26th issue.
Foreign Power and its parent company, Electric
Share, have recently agreed with committees representing
preferred
and
second preferred stockholders on certain
reorganization plan filed with the SEC on
January 16. The first preferred stock will receive 3% shares of
amendments
to
the
new
common
stock instead of 3.6
shares, and the $6 preferred
will get 3 shares instead of 2.9 shares. The
$7 preferred will also
receive $90 new debentures
per share
(with an interest rate of
4.8% instead of 4.5%), and the $6
preferred $80; these amounts
remain
unchanged.
Each
stock
receive
of
share of
a
receives
instead
•
publicly held share
receive .85 of
1/50
55.7%
new
share
■
preferred stock will
instead of .65. The common
(unchanged).
the
of
.
the second
of
common
entire
Electric
issue
new
of
Bond
&
common
Share
shares,
56.5%.
The effect of the agreement will
probably be to save several
time of SEC
procedure, and it seems
months'
SEC
by
possible
decision
a
Federal
New
■
location
the
to
be
may
England
of
forthcoming in the Fall, with
following within a few weeks.
court
25%
Public
of
net
in
June
to
the
story
(See
common.
Service
assets
in
this
filed
preferred
column
a
that
proposed
stocks
June
an
approval,
and
28.)
al¬
25%
This
it is
plan seems somewhat generous to the common stock, and
possible that there might be some revision in favor of the senior
stock, which factor has been taken into account in the estimates
of break-up values made last week.
Northern
owning
about
New
common
1.4
England is
stock
shares of
of
NEPSCO
small "paper" holding company
England Public Service. It holds
a
New
Central
for
common
outstanding, together with about 20tf
a
each
share
in
share of its
own
cash.
Public
Utility has a complex portfolio of domestic
foreign stocks, most of which are "special situations" in them¬
and
require special analysis in order to estimate their
potential market value. Eventually the debentures will be con-'
and
What
where
Electric filed
plan with the SEC early in
February, which is going through the usual routine of
hearings,
filing of briefs, etc. It makes
provision only for allocations to
the prior preference
stocks, leaving open the issue as to the
will
It is not
is not
process
(U.
course,
Not
three
$50,000,000 of
None of them failed to reach the
have many projects vunder
way at all times which
take years to complete. Once
they are well under way
sales
In the past fiscal year the Bank
sold two issues of its own bonds.
are
we
Can¬
ada, Europe and the United States.
fundamentals
any legitimate interest, and
At the time, considerable
fiscal year
one
from
borrowers pursuant to loan
agreements which increased the
total of such sales to
$33,017,496
certain
and off
,
but
During the past year the Bank
sold $5,017,496 of bonds received
that
often the result, and not infre¬
quently the inevitable result, of action taken several years
$625,000.
yet passed
attention
injuring
on
Such, of
for
the
Defense, Too
this applies
to other
as
a
common
at
this claim.
day-to-day business transactions.
usually fully
possible in the nature of things
to give effect to any
satisfactory program of budget man¬
agement in any such way as this. The popular impression
is that the powers that be can turn the stream of
expendi¬
Czechoslovakia claimed
postponement,
Bank's Articles
The
of
of
understood is this:
China made a payment of
$30,000
and advised that it was unable to
the
Cer¬
One of the aspects of all this that is not
S. dol¬
payment in
the due date,
except China and Czechoslovakia.
pay
to be
Not Possible
made
before
well
as
great
all
course,
preferred
one-half
lars
are
rising prices, and "deflationary"
reducing public outlays, were able to
attract attention. That situation seems to have
passed, at
least for the present, since there has arisen in
many minds,
warrantably or not, the question as to whether we have
entered a period of possibly not so
good business when
"a little inflation" might not be so bad.
increased by $115
was
And
Of
receiving in official circles, and, be it said with deep re¬
gret, what appears to be the relatively slight interest
shown in business circles. Six months or so
ago, a number
of influential organizations and individuals were active in
analyzing the possibilities of reduction in Federal outlays.
Some of them passed
by military expenditures, including
defense, for one reason or another, but others went over
plaint centered
procedures, such
re¬
the
Poland
Bank's repurchase of
However, it
was
after
handle
in the matter seemed to exist.
$8,338,500,-
million
of
who
the benefit of all.
total
a
those
without
30, 1951, the Bank had
member countries
subscribed
we
five years hence?
clusion that billions could be eliminated from the
'
r
.
should
energy and initiative?
the whole situation.
loans amount¬
1951, to $691,727,129.
$351,735,295.
or
be
may
some one
spread lack
The undisbursed balance of
effec¬
tive loans at that date
amounted
to
analysis
brought to
by the wide¬
the
we
more thought to what
Washington
all to get for ourselves
through our own
present state of affairs.
It is when this aspect of the situation is
the forefront of discussion that one is struck
$77,564,969 in the year,
bringing total loan disbursements
at
to be dissatisfied with the
had better be thinking about the answer
that question—even if it does not fall within the duties
of
to
ed
small part to the
professional prognosticator, or even the business¬
man who must make his
plans for the months to come,
what the outlook is, and the
probability is that he will
say that much if not all depends upon whether the Federal
to
con¬
by
on
which
when
Washington and give
will permit us
not only the
mind, but the longer term welfare;
of his country at heart, has other and even more
important
tainly,
$5,549,135,
1
Disbursements
defi¬
a
upon
come
we as a member of
this, that or the
other element in the
population may be able to "get" out
of
thoughtful observer who has
faced two, three, or even four
nection with bonds of its borrow¬
ers which
had been sold
Bank.v-
no
valid, but what of the situation by which
the
bringing
total
repayments
to
$6,101,271. In addition, $3,000,000
principal amount had been repaid
to
reasonably reliable
the immediate outlook is concerned this
at
sched¬
on
to
~
Repay¬
principal
all received
amounted
is able to find
consumer
as much
spending this fiscal year as it
saying it will, the thought being that the more
Uncle Sam spends the better business will be. So far as
the Bank
year
$1,113,525,000.
of
were
for several months past.
has been
totaling $297,080,000,
total
30
eye
Government does
$62,280,965.
During the fiscal
June
■
that
on
to
Has the time not
to think of what
Ask the
ob¬
June
on
certain
and
the
But
reasons
year
as
amounted
made
the
public
the
nor
all harm?
us
immediate situation in
Special Re¬
required by the Arti¬
Agreement. This reserve
of
date
the
meeting the Bank's
30,
ule
Guarantees, V
$42,155,217.
Loan
were
less
uncertainty in Washington. All elements
in the population are
badly in need of a clarified situation
with respect to national
expenditures, and particularly
concerning defense outlays, and they need it now.
come
Loans
or
do
an
plans for the future—due in
confusion
for the entire period of the
Bank's operations has been
placed
in
a
General
Reserve
Against
on
more
is true of
same
nite basis which appears
to build
In accordance with the
decision
of the Executive Directors and
the
Board of Governois, all net in¬
on
The
believed
have responded in
to
Neither business
•148 bond interest and other finan- *
and
heretofore
has been much in the
045,595, including $4,843,447 ad¬
ministrative expenses and
$8,202,-
Losses
quite generally has been adjusting itself to
consumers.
Both, indeed,
exaggerated manner to what
they thought would be done in Washington. One result
is the hesitation in the general business situation which
seem
with
totaled
situation
a
develop.
the Special
to
compared
as
/
of
in
'•
with the good of their
country at heart,
we afford
conveniently to
thinking about? Can
forget that the central government is
spending, not mil¬
lions, but billions of our
money in ways which can not
be of benefit to
us, but on the
contrary, must in the end
cease
Over-Adjusting
Business
Expenses
year.
\
the
$25,464,065 for the preceding fis¬
cal
■
amounted to
year
income,
the
1951,
income
$6,388,543 set aside
ReserVe, amounted
for
30,
It
unsatisfactory unless national policy is
definitely set for the future and appropriate funds pro¬
net income for the fis¬
June
We See
to grow even more
construction and Development has
reported
thoughtful citizens
should be
23
which
business, which all
selves
verted
the
into
common
company
are
in
stock.
no
Presumably,
great haste
to
however,
carry
out this
officials
of
plan since
at
present the Company enjoys very substantial tax benefits.
The Treasury Department permits the interest on the debentures
to be used as a tax loss in the consolidated
system tax statement,
although interest had
vantage is at present
not
been
paid
to
reduce
for
many years. This ad¬
income tax payments of
subsidiaries, Central Indiana Gas Company being an im¬
portant beneficiary. In the twelve months ended March 31, this
subsidiary was able to save its entire estimated Federal taxes
used
certain
which
would
normally
have amounted to $1,123,944, including
profits taxes. This saving accounted for over
one-half of the $5.33 share earnings. The Central Public Utility
.debentures have enjoyed an advance from last year's low of
$187,000
21
and
excess
this
year's low of 30 to the
current price around
40.
,
24
The Commercial and Financial Chronicle
(616)
ascending scale of price increases.
Continued from page 9
the
In
months from June
11
last
to May this year, retail prices
rose by 5%; in the
year
in Switzerland
Britain's Financial and
United
Kingdom
9%;
of at least
in
£1,000 million
year
a
subsidies.
I
think
V
the
that
that that is
agree
House
will
pretty
a
stag¬
the gering figure, but it is not really
United States by 9%; in Italy by
surprising when one reflects it
10%; in Denmark and Canada by costs
roughly £40 million a year:
11%; in Belgium by 13%; and in in subsidies to prevent an in¬
France, or more strictly in Paris, crease of one
point in the index.
countries do not share our views, by 21%.
If, therefore, we had sought to
either on the desirability of sta¬
Figures for Australia and New prevent any rise in the cost of
bility of prices or upon procedure Zealand are not available until
living by subsidies and taxation,
through the International Mate¬ such recent
dates, but from June on the lines I am discussing, it
rials Conference Commodity Com¬
to December last year—that is, for would have meant, for example,
mittees.
'
about half the period only—the an increase in the standard rate of
In recent months, as the House rise in New Zealand prices was Income Tax from 9s 6d to 12s 6d
will be aware, there have been 6% and in Australia 9%.
These in the pound, and of the
two
by
price of imports into the United
States of America rose by 30%,
exactly the same as the
almost
or
figure for the United Kingdom.
that in the face of these
hard facts and figures, the Right
Hon. Gentleman, the Leader of
the
Opposition, will now stop
some considerable
falls from the
drooling at weekends about de¬
valuation
and
world prices,
of highest levels of raw material
which he knows little, and I hope prices. In February, for example,
tin was selling at
£1,500 a ton.
that he will put into the wasteI hope
-
'
basket his out-of-date and
Conservative Central
paper
inaccurate
Office
evi¬
which
with
leaflets,
dently he was briefed on that oc¬
casion.
;
,
...
however,
the result of
not
If
rearmament.
our own
we were
to reduce our defense program
say,
£200
even
if this
not offset by ad¬
were
civilian
ditional
million, and
£300
or
by,
it
expenditure,
would still have very little influ¬
ence on the world
prices of the
vast
majority
£875
about
at
a
rubber was
It has since
lb. Marino
wool, which reached 295d per lb.,
In
about
February,
6s
lb.
per
United
March,
have
in
tions
have
futures,
lb. in
per
been
other
some
180d.
fallen
now
There
cents.
cents
42
were
about
cotton
States
which
per
to
down
now
to
35
reduc¬
commodity
prices also. On the other hand, a
few prices, including non-ferrous
metals, are still rising.
now
like to turn to do¬
mestic matters,
I do not propose
following on Korea and rearma¬
to
anything
say
public
on
ex¬
countries, particu¬ penditure generally, because this
larly, of course, in the United subject has been very thoroughly
States, the scale of whose pur¬ discussed in our earlier debates.
chases is inevitably huge in rela¬ The crucial fact, of course, is that
ment in many
about half
tion to other countries.
While
have suffered
we
excep¬
tionally in recent months, because
depend so much on these im¬
we
ports and because the cost of im¬
is
public expenditure
our
defense
on
the
and
National
Debt, and of' the rest over threequarters is on the social services.
In the small remaining section, as
I
explained in
Budget speech,
my
ports here is particularly high as
we have made considerable econ¬
a
proportion of our national in¬
omies, and we shall continue to
come,
the producing countries
do all that we can to keep ex¬
have, of course, enjoyed some
penditure down.
benefits from this change. These
In the field of social services,
countries include some in South
and Southeast Asia who are our however, and with the full ap¬
partners in the Colombo plan, proval of the House, we are al¬
whose economic conditions we are ready committed to an increase in
glad to see improved and who are expenditure next year of over
£ 70 million above this. That ex¬
now in a much stronger financial
position than a
tra money
ago.
year
is for the most part re¬
for pensioners and for
quired
The Question of Raw
those
Materials
and Prices
Even
so, in the longer run I
doubt if such changes are for the
benefit of either producers or con¬
products set up inflationary
mary
forces in the countries which
National
Assistance.
I
hope that nobody grudges it. We
should accept it just as willingly
as we do the requirements of na¬
tional security.
^
■
,
I have
Very high prices for pri¬
sumers.
on
spoken of the rise in in¬
ternational commodity prices and
its effects on our total imports
bill, and therefore on our balance
of
payments position.
But, of
price increases are nearly always course, to the majority of people
followed by
equally rapid de¬ its consequence is apparent in a
clines.
It is therefore of the ut¬ far more^ obvious and immediately
most importance, not only for the painful direction:
that is, in its
United Kingdom but, I believe,
effects on the cost of living.
All
for the whole free word, to secure of
us
are,
naturally,
worried
a greater measure
of stability in about rising prices at home, and
these world commodity prices. If it is to this subject that most of
this
cannot
be
done, if prices the rest of my speech will there¬
either start rising again or fall fore be devoted.
very sharply, then the economic
First, I should like to try to
and political consequences cannot remove some
prevalent misunder¬
but be very serious.
standings. One of these is that
ex¬
them, and past experience
shows only too plainly that such
port
In
view, this problem can
be dealt with by interna¬
tional agreement.
His Majesty's
our
the
price increases from which
all
we
only
are
Government took
peculiar to this country or are the
special product of actions that the
leading part,
a
suffering
somehow
are
following upon the visit of my
right hon. Friend the Prime Min¬
ister, in setting up in Washington
government
the
ment to the Motion which
International
Materials
Con¬
ference for the purpose of sharing
out fairly the available supplies of
materials.
scarce
glad
am
to
that there have already been
say
good results.
suitable
should
We
also
well
as
We
views
to
try
to
Conference
agree
price,
a
to
on
or
ar¬
range
consumers- as
producers,
have
on
believe that in
the
cases
rangements for
of prices, fair
v.
I
made
our
this matter known to the
and France and to the Council of
O.
E.
E.
C.
We
are
also, of
to
have
taken
have
or
take.
Indeed, there is
the Order Paper an Amend¬
on
that.
The
how
best
idea
of
way
completely
this
the
implies
showing
unrelated
facts
is
taken
place in retail prices
countries.
I
particularly
September.
I
be¬
Members oppo¬
Opposition, whose contin¬
references
outbursts
to
in
the
of
wickedness
are,
of
he will
no
the
hon.
Member
for
Scar¬
some
of
hon. Friends who do not agree
my
with
me
the
this matter.
on
we
time
same
government,
an
I shall
are
but
awareness
taken
from
tions Bulletin of
the
United
Na¬
Statistics, in
an
It
be said, of course, that
need to contemplate
may
there
is
such
not
no
extreme
an
raise,
sidies
for
by, say,
a
ceiling
of
for
reason
£100
of
If by
this
re-arming at
are
as
pose
to
million
million?
My
is
as
follows.
The
the
be done.
can
As such, they
They
introduced
were
this
for
in those years did not
After the war,
however, the average cost of im¬
ports began to rise, and with it
den caused
by higher defense ex¬
penditure is not offset by taxa¬
will well recall that between
tion, or that this taxation is not
firmly placed on the shoulders of
must
despite
those
rose
this is
able
to
bear
it,
then
charge which I emphati¬
a
cally repudiate.
The burden of re-armament it¬
self falls
the
the
on
extent
only to
Budget in¬
consumer
that
the
creased certain taxes.
on
company profits, on petrol, on
Purchase Tax on motor cars and
other less essential goods, and
I do not think
on
on
the Income Tax.
myself,
dence
nor
was
there
evi¬
any
produced during
our long
Budget or the Fi¬
Bill, that these taxes were
unfair, or that they fell on those
debates
the
on
nance
least
able
to
outstanding
bear
fact
had to buy
the
them.
The
is
surely this.
The rise in retail prices in the
United Kingdom in the past year
has, as I have said, been mainly
due to the rise in import prices.
extent
of
the
subsidies.
My
right hon. Friend the Minister of
Local
and
Government
and
Planning
1945
1948
they nearly doubled.
I
point out to the House that,
this, wages and salaries
Finally, the then Chan¬
cellor of the Exchequer had to
impose a ceiling in order to pre¬
also.
ought
overseas.
to this.
comes
should make
in
subsidies
either
pared
to
effects
of
that
or
that
the
to
prove
they
are
pre¬
face
the inflationary
increasing taxation
propose heavy in¬
they
taxation and
this
of
show
can
the
is socially better than any
I do not myself believe
money
other.
way
without
that
Those who say
larger increase
a
that
not
in
creases
have
to
>
-
must
House
spending
the
of
assurance
greater
stability it would have
been any wiser this year to in¬
crease subsidies than to adopt the
policy of cutting them which the
Opposition, with its usual spasms
of indecision and vacillation, peri¬
odically advocates.
will
I
should
therefore
it
that
add
just
become
slight increase
possible,
by
a
the amount of
in
subsidies—and from the figures I
have
given it would have to be
so as not to impose
fiscal burden—to se¬
very slight,
too heavy a
general
cure
of
measure
then
agreement
internal
must
I
have
that
say
for
.case
on
,
should
we
attitude.
our
subsidies
the
a
stabilization,
reconsider
to
is
es¬
sentially that they should help us
to stabilize the position internally.
If there
solid
were
that
evidence
this could really be achieved
achieved
at
no
great cost,
and
we
should, I agree, be foolish to reject
the possibility.
rise substantially.
Outlook for Prices
So
much,
to
for
something
cannot do
deal
what
then,
in my view we
which
with
the
problem.
But
and should we do?
can
Be¬
fore I deal with that I should
to
give
the
House
views
like
idea
some
of
prices,
as
this
the outlook for
is clearly funda¬
mental
to
any
assessment of the
my
on
problem with which
deal¬
are
we
ing.
vent the Budget from
getting out
becoming the vic¬
must
tim of movements in world prices.
some
of control
This
The main
additional taxes of the Budget fell
It
certainly
sent
we
The
question that.
have already given some of the
justification for it, and I shall
give some later in this speech.
But if by this charge is meant
that the government are delib¬
erately pursuing an inflationary
budgetary policy so that the bur¬
best
been
pur¬
be very valuable and I do
think
that
anyone
would
may
not
infla¬
world
a
which
sub¬
million
£510
£410
Why
the
rejecting that proposal,:
of course,
of
proposal.
example,
is occurring, and that the puropse during the war when,
high prices caused by this infla¬ partly because of Lease-Lend and
tion and by consequential wage partly because of a series of longincreases are not being offset by term
purchase agreements, the
increased subsidies, this is true. I import prices of the food that we
and
year—and
this—if
£100
million
face
must
we
had
we
spent
another
in
subsidies,
it
certainly not have pre¬
steep rise in the cost of
living index. The difference that
would
vented
it
a
have
would
made
would
have
been
only about 2% points.
anyone really
suppose
that
would have made
in
ence
to
6d
in
such
If
on
have
I
have
yet
men¬
work
retail
to
the
their way through to
price level and be reflected in
weekly bills.
meat
our
In food, the rise in
prices
resulting
from
the
Argentine Agreement, which the
time ago, has just begun to oper¬
ate, v This
and certain
other
all
at
the other hand,
increase in
an
which
which
Minister of Food announced
further increase
Tax
tioned
this
crucial differ¬
Income
the
three levels.
a
increases in the cost of basic
commodities
Can
achieving stability?
But
for it, of course, would
pay
have involved
of
a
Some further rise in retail prices
occur.
There
have
been
subsidies,
as
I
some
changes in food prices which have
occurred
or
be
foreseen, some
likely by the
August to have raised
can
of them
seasonal,
middle
of
are
by two points the June retail
price index of 125.
Most of that
claim, could not be relied upon increase has in fact
already taken
to achieve greater stability, then
It has not been due to our in¬
place.
surely they must be compared as
ternal
re-armament
In the last quarter of the year
program.
a
matter of social policy with
Those who attribute it to re-arma¬
there may be some small seasonal
the Ex¬
ment are, therefore, either simply many other claims on
increases in the price of a few
chequer, especially in the field of
misunderstandin g
or
misrepre¬
foodstuffs and of fuel and light.
social services, such
as
higher
senting the facts.
In addition, increases must be ex¬
pensions and an increase in family
Secondly, of course, the burden allowances, both of which are pected in the prices of some items
of
of clothing and household goods.
higher import prices, as I
fairly closely related to need and
pointed out in my Budget speech, are at least
If this forecast proves to be right
subject to taxation.
-
.
is one that the nation
must
to
bear, if
we are
balancing
counts;
whole
and
alteration
our
this
cannot
be
to
as
a
whole
come
near
overseas
burden
avoided
ac¬
as
by
a
any
It might have been said that
we
should not have attempted to off¬
set increased expenditure on Sub¬
sidies
and
by
that
higher taxation
should
we
at
have
all,
aban¬
in
taxes, subsidies or doned altogether the
budgetary
policy.
What principles adopted in the last few
achieved by internal pol¬
years and instead have accepted
icy is, within limits, to redistrib¬ an
openly inflationary budget.
I
internal
can
the
financial
be
burden
the
between
individ¬
United Kingdom.
Those who
argue that we should
have done this by increasing both
pay
do
not, I believe,
figures which
the
for
appreci¬
are <
in¬
doubt whether
Subsidies
of
living
index
hon. Member
it
that, with the increase in
prices behind us, the in¬
means
meat
creases
steeply
the
that is not
price
of
everything
subsidized.
—
that
is
word, because it is
important than that—at the
wrong
more
,
.
the
question, what is the outlook
future world prices?
What
for
by
we
far
the
turbing
can
but
expect from the interna¬
factors
our
make
I
largely into
our
facturing costs.
have had
prices shows
ments
lion
of
end
to
subsidies
present
1951
an
—
would
by
then
additional £600 mil¬
£700
million
over
and
a
year
above
£410 million—or
a
in
the
total
particularly disastrous
balance
dis¬
No
economy?
the price of commodities
the
A>ur
played
in
one
predictions,
already drawn atten¬
have
of
a
have
clear-cut
present time such a course would
on
which
greatest part
steady
from
September,
1950, when it began to go up after
a
longish period of stability, to
effect
the
tion to certain substantial falls in
1
perhaps
in
recently occurred.
That, of course, at once raises
tional
check, and tend to raise
face
to
good deal
less steep than those which have
must
cerned to
have
we
next half-year will be a
irresponsible course, which would
clearly stoke up more vigorously
the very inflation we are all con¬
the
To have held the cost
any
—and it is the best I can make—
would seriously advocate such an
Incidentally
have cost
give these figures, which
I
think, speak for themselves.
tion
ate
doubt confirm, not
6d
if that
the
volved.
chasing power of our money as
something
due
to
the
special
8s
to
increases,
man), for instance, and
site,
the
pur¬
6d
borough and Whitby (Mr. Spear¬
weekend
his
fall
5s
These
subsidies, we can
surely agree, is primarily to main¬
tain stability of income and prices,
some
them
the
of the facts.
to think that other
hon.
alliance
of
to the
the matter.
no reason
tween
curious
a
right hon. Gentleman the Leader
information
incomplete
Washington in
occasion
the level of subsidies and the level
of taxation still higher to
commend this
misrepresentation
to
ment
from
6s.
to
instead
other to pay for re-arma¬
in this way.
There is on
or
uals within
in other
that
rates
3s
how
that
have
said
and
make
give
merely
have
sometimes
lower
the government have deliberately
allowed prices to rise so as some¬
ute
is
deliberate
I hope myself to pur¬
the matter further when I go
also
to
to
course, in touch with the govern¬
ments of the Commonwealth on
sue
is
figures of the increases
the
ual
already
governments of the United States
the
failed
It
is meant that
Domestic Affairs
price increases are plainly the re¬
sult of a
larger world demand
I should
figures issued by
the various countries.
They are
not in every respect comparable,
but I have no doubt that by and
large the comparison is accurate.
It speaks for itself.
•
about 4s
fallen to
The
materials.
of
stands
it
ton.
is
higher import prices are
Those
also,
v
Now
the official
are
ated a more powerful force at¬
tracting to the home market goods
in
Economic Situation
Thursday, August 16, 1951
...
of
pay¬
Trade
index
in the past
a
entering
import and
The
of
new
basic
fall
of
manu¬
Board
material
over
three months.
which, as I have already
indicated, is by no means in a
secure
position.
By * leaving in
the hands of the public more pur¬
at present no sign of any
chasing
to
12%
There is
power,
it would have
cre¬
contrary
tendency elsewhere big enough to
offset
these
which
we
achieve
falls.
ourselves
a
measure
The
are
efforts
making
of interna-
Volume 174
Number 5033
.
.
.
The Commercial and Financial Chronicle
(617)
tional
price
which
will
I
we
of
currence
affect
achieved,
rises
what
increase
which
cost
concern.
-
stationery,
chiefs, and so on.
Discussions
form
place
us so
much
all
practicable
to
raise
their
without
not
agreed
the
to
meanwhile
essential
war.
how far
we should now return to
more
precise forms of control,
For many goods in the Board of
Trade field the present control is,
price control, and after 10
years'experience of it there is no
is
the
as
House
is
probably
aware,
doubt in my mind about the valuby
able part it has played in check-.'My
ing inflation.
France
in
which
I
mentioned
where
ago,
other
little
a
incidentally
time
and the
in
that
has
been,
impression
control
that
ished
the
in
certain
last
that
forms
is, of
control
during the
But, on the
during
war
the
in
of
tor
our
to
the
meet
method
objection
penalizes
efi'i-
price-controlled
The
most
important
index
the level of bank advances.
been
lower
of
which
cost-
think
These
that
as
compared
year.
with the previous
the
of
,
I do not
is
highly
subject
have
are
included
to
tuations
some
commodities,
marked
seasonal
flue-
has
I consider that
now
tighter
The
posed.
check
to
fact
increased
.
There
all
is
a
particularly
the same,
effective where
more
spending out of credit should be
effectively discouraged.
every
tightening of credit
control requires an increase in the
the government pay
to the bank-
the
and
system
money
I do not agree
mar-
with this.
A
¥2% in the charge on
even
for the increased tax revenue, the
increase would still be £16 mil-i
"on,
I could only agree to
a
step
It
is
by no means clear that a
rise
in
Treasurv
for
arrangement
improving
bill
of
volume
credit,
it
that
clear
is
and
the
on
still
less
to
The
necessary
reduce distribution charges and so
I understand it,
that unless the Treasury bill rate
Without standardization and close
keep prices at a reasonable level,
is
control of
ficult
of
to
specifications, it
the
ensure
quality,
and
form
a
dif-
is
Although it would be wrong to
maintenance
that
think
the
measures
I
have
of price-
just enumerated
are
likely to
bring about any significant reducis one ot the
great arguments for tion jn the retail price index, they
the utility schemes.
will, I hope, ensure that over a
Where
the
costs
of
different
very wide range of commodities
firms diverge, there is bound to be the
prices charged do not rise by
a problem of
settling what maxi- m0re than the increases in matemum prices are appropriate.
On rjaiSj wages and other costs make
the one hand, adequate production
inevitable.
The
matters
I
have
control evasion can develop.
distribution
and
be
must
That
main-
described
will
also
be
supple-
achieve
the
argument
allowed
result.
desired
is,
as
rise,
to
the
banking
low-cost
entirely
their
on.
and
national
own
without
regard to the
interest there might be something
in this argument, but the clearing
banks
have
for
cepted
that,
in
years
many
ac-
check,
five practices.
from
up
may
make
nf Wider
of Wid^r
to
the conclusion that, in
of tne present economic situ-
ation, further steps must
the
Board
now
of
field, all utility goods and
others
troiled.
lation
are
already
completed
a
goods which
S>rnHo!!ed+haond
the
mended
control,
be
Trade
many
price
con-
The Central Price ReguCommittee
either
voluntary
has
recently
special review of
have become dere
-
by
imposition
It
the
of
success
depend.
is
they
without
derogating in any
their accepted standexercise
to
from
which
circumstances
Should
ance
they
our
present
clearly demand.
further
need
from the government, which
^
ot
subject
n
Budget
.g
ri0us
use
inflation
character.
our
of the
It
is
most
se-
indeed
no
withdrawing purchasing
draconic high taxation
by
p0wer
if> by the back door,
so to speak,
iarge additional quantities of
credit
are
system.
the
being pumped into the
it is generally agreed in
United
States
that,
in
the
period after Korea, credit
expansion there increased demand
early
and
w
contributed
quite
M
j sh0uld add that my
to
a
rise
in
materially
.
for
rates
^ernmen? ZolllX
imposition
on
.
Profits and Dividends
1 .P°w turn to the question of
profits and dividends. The House
wil1 recall that in my Budget
speech I drew attention to the
fact that profits had risen by
nearly 14% in 1950 and were certain to rise further in 1951.
I
asserted that this was a movement
°t
fairly general kind, not so
much associated with any particular improvement in efficiency
or managerial skill as the consewence ot much wider world
events. I said that was one very
good reason for imposing heavier
cial
for
wbich
tbat
that it
Budget
to cofnmeradva'nees, the rates
billg and
slightly.
the
short-term
recently
have
The
without
risen
important thing is
the bur-
increasing
pnnp;
den on the Exchequer unneces.
sarily,
should
at
a
imn
level
the
of
not be allowed
rate
which
advances
to
expand
produces
lnar. c0"ences
tl0nary consequences
infla-
ticularly
careful
that
ensure
.
the
in
purpose
.
of
to
the
Tho
or
1
sit
pnn+rri1
ni
!
7
,T
control will !PP Y \° J!
orfni
^ fn private* Af
i
i! rearmament
v^r«=
^
g ^
rtrih,,S S ni
^? 0l£er ™anal:
+£1 i^Tt' will \SS
'ii
,
fn
n
it
«
u
w
r
let
" Lt
a
average oj.
thl ia^
nf
r
Tn 1v
97
^pn ,eha/
^ ^
d
w
loii /fin.
'tin nrZinrpTnr
p
nnrm-S? 1^°
d^y ^ (iiviaena, tnere wlu
"e an aiternative stianc arctequi /
alb t to o/c oi the leievant cap
.ia*> wmc% means, oroaaiy speaK"J!*, ™e pa:m-up snare capital,
* 0
° 1
* ?P L'J
c ™paaLes' "i!le^
«*e
°*
to raise more capitel toe standard
There will also be provision
cjn.umstan(l,s
decide
to
that the
eimimstances,. to decide that the
increased
wiTto
I
rpnnrtpd
to
reported
to
thp
Ronw
tne
tho
iiouse
tne
make
of
nJ*nu^y
I
rate
if
oyf Lrease
Trie
in„
nf
,
.
^ut '"
rose
to
? T*
p
1P km
r
•
V
'
:
unrro
it
hppail5,p
.nr,+
lirnif
wi]1
^
...
.,
obarp
.
.
pherk'inflation
,
following
valnps
Hividpnd«s
Rut
I
on
must
make it plain that 1 also regard "it
essential prerequisite if increases
^
^
through
higher wages and salaries,
be effectively checked,
are
to
Question of Wages
That brings
tant
me
to the impor-
difficult
and
question
of
During the period 1945 to
1948 the wage rates in this coun-
wages.
and'
"i try
rose
by 18% and average
earnings by more than 20%. Dur-
°'
Moreover, the averages conceal
many individual increases on a
much bigger scale. In tact, it is
exaggeration to say that practically every morning there is
^ws of a company increasing its
money incomes which has recently
been taking place.
This kind of
.in6yitably acts as a con-
tinual irritant on the great major^u^ly snarenoiuers.
18 happening against
will reduce the
fhmres
,l"e
S ?oS
¥
income
ibp inf.ronqpe for Aoril
+hpR
we propose
y^
allows for the increase
f®x:. " ""e
M
with
1U%
a
,
,
^ ttentept
pn
.
which
dividends, and I p
have ma^de it. plain that I was
disturbed by the continuing inf^easf
lagt year. It is true
the months of April and
movements
v
on
Since then I have from time to
fbrip
llme
jn
this
period—the three
years
after dle war—despite an increase
«n £00(j subsidies 0f £200
£bere
was
aiso
a
million,
jn
rise
retail
pr]ces 0£ ab0ut 18%.
From 1943
£0
£bese movements all
sjowed
The
down.
increase
in
rafes in fbat period was 5%,
increase in average earnings
wage
£be
ab0U£ 9%
tad
and the increase in re¬
prjces between
aithough there
d
j
subsidies.
tb
and -3%,
increase at
5%
was no
Since
last
AfteraV 11 more rapid increase been 3 m"ch
U autumn there has
au,
in wage rates,
the back-
which have gone up by 8%. The
tQtal increase in wage- rates during the last nine months has been
as great as the increase during
the preceding three years,
We have often said that inance of payments.
The psycho- creases in wage rates and earnings
logical consequences of sharp which dQ nQ more than parallel
increases in dividends are far an increase
productivity have
greater than their direct monetary
harmful effects on costs, be-
ground of a heavy defense program' a „rise ln, .prlC€!8 larSely
"Jduced
outside> but none~
fheless unpleasant for that, and
a growing anxiety about our bal-
effe,Ct Jhey- ^ ^ b°d/
in claims for
lending
vote umce when
H0u"e the^fXwtoe Outline™
.
internally, moderation
and that the banks should be par-
f'
—
be avalJabJ^
taxationon profits; m doing this
V
however' that this power
m the Budget I made it plain
clear; howeve: ttat this power
that I wished to discourage eom.
,
,r
great maiorpames from increasing their dm- fpf"al casefh„ ^ ' Ifufnrnvided
dend distribution so that they ^^BiVmut"
should put the maximum to re,
£e™e'
AA
Th
bmjtatinn
d i
id
cI
objections
™Qlt^ aDpiy
obvioug
enough that, in theory, unlimited
expansion of credit can create a
demand
knowing the rate
discount Treasury
^
announcea.
for existing companies which
provide it.
dividend in a pretty substantial
fashion and on a scale far greater
at than the
general increase in
not
i-
guid-
must be of a fairly general kind,
I shall, of course, be willing to
.
"
essential principles or
-!r^yr
personal
incomes
salary earners.
than
one
higher
by wage and
I have on
more
occasion given warning
.
.
j
^ause, of course, the rise in wages
should be offset by the increase
in productivity, so that prices do
not" go up at all.
Recently, the
increases in
far
to fhe rise in raw material prices, loan coincides with the national that if this movement continued 13
consider- This policy in the United States interest, for example, because it we should have to consider taking
statutory
means, over a
my
n0w llke to say something more
reyiew the present scope and machinery of price control and have
In
of
Controls
Controls
Pripp
Price
Qn
taken.
course
statement, I referred very generally to credit policy
f should
The governmnet have had under
come
the
jn
spared
if they were
even
which they can
bills
Credit Policy
.
sub-
stantial profits.
view
unique
the uncertainty which these commentators suggest would
result
firms
Prnsnert
Prospect
must
of credit
matters
efficiency of our methods of dealing witb monopolies and restric-
efficient or maybe more
fortunate
their
of the needs of their
If the clearing banks were act-
ing
Proposals designed to improve the
for the lost
production. If, on the other hand,
prices are fixed at higher levels,
more
and
iU"e the
cannot, for one
another, expand corre-
spondingly to make
the
policy
the banking
officials
°t
the
the Bank of England without loss,
thus continuing to expand advances at will.
"
position where the
a
firms
or
by
Qn
was: 8 k% 9% Jgropawd
nearly 14% in March and
can always replenish its.s
unds by selling Treasury bills to
mented by action on resale price policy, it is their duty to cooperate
the firms with lower costs, the
maintenance, on the lines recently with the government. I have no
danger has to be faced that other mentioned
by the President of the reason to suppose that they would
firms may be unable to carry on.
B0ard 0f Trade.
He, I may say, is not be prepared at our request to
That may not in itself matter un- a}s0
considering certain further keep the level of advances
in
reason
is
assurance
,
I3
^
i tnV
\n tne
•
system
^me£' If prices are fixed to suit
less there is
knowledge
would
rates
effect
the product is more or less standard, with no great divergencies in
the costs of the various producers,
marketing and distribution in this
field which in time should help to
cooperation
systemi
It
each bank
It has been suggested sometimes
of itself have much
an
of
■
this renewed
value
even more
retail
control, but the government are actively considering
purposes.
I
but essential
any
,
.
are+necesfary if we are not to be
™ Z ^ustr?1tefd m 0UJ .1
?
check inflation and the
^ease in the cost of living. We
^ave therefore decided to mtro-
to
crimination
of
price
utmost
day to day the selection and dis-
Minister of Food, considers that it
would be undesirable to reimoose
limitations,
in price control.
It
their
ha
T
plI:b3V<Ln.°w reached the con£at ^ further 8tep*
carry
the
facilities
wouia De unaesiraoie w leimpose rise in ireasury oin J^tes
..
..
,
inherent
are
obviously
,
that the banks will
do
im-
be
that
very
for
pressure
for
come
exneSre
rp.
to
way from
ards, will have
time
rather
of this kind, which has to be met
no doubt been increases in profits
and
by taxation and which will conin these industries, but I can as- control
as
regards
quality-for flict sharply with the efforts we
sure the House, after the examinaexample/ fresh fruit and vege- have been making to keep down
tion that we have made of the potables
which account for 11%% public expenditure in the country,
sition, that that has largely been „f all' the
on
food, if it were the only way to check
because of greater exports than
My right honorable Friend, the an increase in bank credit.
because of any leniency in admin-
me
endeavor
but, nevertheless,
suooly and demand,
difficult by ..their nature to
istration.
House that the Governor has since
informed
who,
food, two-thirds
perishable
credit
on
glad to tell the
materials and other cost increases,
the money spent for the home
one-third
banks
am
customers that the
the floating debt would involve a
gross additional
charge to the
goes on items already subject to Exchequer of not less than
£30
price control.
In the remaining million a year. After allowing
case
I
surprising, in view
of the higher prices of imported
rise of
•
emphasis the request
predecessors and I have
m
restriction.
is
rising during the past
by about 10%,
year
ket.
of
sec-
There
the
repeat with
bank credit for
ing
i„
existed
dropped,
there is no
economy.
this
Bank of England and asked him to
on
Dividends
on
advances not offset by equivalent
savings is clearly inflationary.
ceiling they will use.
doubt that the increase in profits
which has taken place has been
least
order
uation
out the policy I have indicated to restrict any extension of
plus woud not operate, manufac-
were
whole,
consumers,
views
my
but not things which they can buy,
investment financed through bank
turers being free to choose which
its
It is also
which
for
we
below
the meticulous
of
some
of
income
short-term rates of interest which
where
end.
an
Since
money spent on investments
generates
further stens tn deal with the sit-
this matter to the Governor of the
addressed to the
to provide for two price ceilings,
abol-
was
years
here.
explained
which
course,
price
instances
three
value seemed at
true
It
was.
investment
or
Proposed Limitations
have
than
influence the
can
defense
or
vital home invest-
some
ye
a
that
that
strictly
price control
to
the
en-
some
less
been
con-
are
I
ciency—it was always the difficulty about it—and encourages
inflation of costs, he has in mind
know,
recently
has
forced than it
true
I
with the trades
or
likely
for
buyer
for essential purposes,
of this and other controls,
There
we
important
America, but it
of
production
ment.
should now supplement rearmament and exports, is likely
this by the cost-plus method, as to expand, makes it necessary for
was done during the war.
us to ensure that other types
of
import prices have far less effect
on
the
internal
economy
than
success
that
reaS0n
Jess
for
an
on
have
we
materials,
the
higher cerned,
here, show the importance
simple
prices
raw
consultation
countries,
said
p
as
cash maximum prices only,
right honorable and learned
Friend has come to the conclusion
that in appropriate cases, and in
The price increases
and
the
f0r
is
export or
occasion, the expansion
affect
pay
have
We have also been considering
external factors to drive up prices,
One of these steps which can be
to
now
been dropped since the
possible
as
The Com-
extending its review
be over a11 cases where control has
should
far
so
mittee is
that
with
contraction of credit is not
level
say,
have
earlier
more
the
some
modified
this count
con-
cases
prices
every internal cause which might
operate
independently of these
taken
in
and
In
taking
now
industries
manufacturers, I am glad to
,
steps
limit
are
the
been
now
marked effect.
much
Committee's approval.
nevertheless
taken
with
handker-
the most suitable
on
has
hoi-
forks cutlery
utensils,
toilet
paper
control
cerned,
tinct possibility.
is
of
living
.;A,A¥
and
kitchen
paper,
Of course, this is not a certainty,
but I think on balance it is a dis-
It
spoons
of
all of
causing
out-aluminum
it
general
the
see
of
mops
be
unquestionably
cause of the rapid
the
in
is
after
has
been the major
a
lowware, washing machines, carpet sweepers, brooms and brushes,
I hope it will be, we
as
The list is
and I will not read the
one
re-
to
were
of goods.
range
whole
began
as
markets
this
able
long
the
any
reasonably hope to
to
end
avoid
can
such
If
and those
countries
strengthen
world
Korea.
could
other
sure
make,
hope that
to
stability,
am
also
25
wages
nut-distanced
have clearly
anv
J
mcrease
10
Continued on page db
Financial Chronicle
The Commercial and
25
.
.
.
Thursday, August 16, 1951
(618)
jrom
25
page
upon
^
contributed
The
the
costs
continuation of
retail
of
were,
the
to
resulting
prices
It
is
that
well
as
the
development.
section
of
should
we
implications
only
When
a
far
position as against that of the rest
of the community, including other
those
from
whose
income
incomes
fixed in money terms
so
factors
external
as
are
are
a
that
much
do—
can
we
productivity,
espe¬
have announced
intended to support this pro¬
are
which
I
to attack the obstacles
its achievement, especially the
and
gram
to
greater economic
stability.
I have explained our
reasons
for adopting certain
measures and our reasons for not
con¬
of
achievement
stop.
adopting some others, tempting
though they may be.
The situa¬
have
tion
we
one
more
to
face
represents
ever-changing
the
in
with which
develop¬
ments
have
presented us.
We
have made our forecasts as best
series
problems
of
international
continue of its own momen¬
now
to the wage
is
increase
policy
be coming
It is of the most vital
importance that in these circum¬
stances, and especially when there
is a danger of a check to the rate
of
increase
in
production, the
wage-price spiral which was, so
to
speak, set in motion by ex¬
ternal forces last year, should not
in different occupations have
increases, these are all cancelled
out by price increases and nobody
is any better off.
That is not
strictly true.
The rising wages
transfer of real
accepted
be
in any
cially where it matters most.
The
measures
of
government
that this
long as
slowed down and may
to
ers
a
be said
will
there
to
cerned, the upward movement has
It is sometimes
supposed that when all wage earn¬
earners.
involve
other
the
prices are rising, but I have al¬
ready indicated to the House that
there is reason to hope that, so
wage increase, obviously that for
the time being must improve their
wage
and
labor is retained
no
Finally, as
always, we must do what we can
—despite raw material shortages
which I have announced
it
know
cannot
one
obtain
workers
the
I
this
of
when
time
quarter unnecessarily.
today will help to ensure the ac¬
ceptance of a policy of reasonable
restraint in the field of wages.
the
increase in import prices.
consider
much that the con¬
dividends
of
trol
measures
higher
from
best
that
I hope very
still
course,
reaction
the
the rate of wage
economy.
of
and
more
postwar
take
tum.
we
as
what I am
afraid has inevitably been a rather
another turn, we must be ready to
fer to those who receive them.
long review of the complex
difficult situation in which
if
and
earners,
in
consequence,
This then completes
undoubtedly frequently hap¬
pens, profits rise, too, also a trans¬
The
danger,
great
think, of
a wage or cost
inflation of this
kind is that if it proceeds at too
violent
it
rate
a
I
threatens
stability of the whole
adapt
matters
Should
can.
but
for
the
the
basis
accordingly;
policies
our
and
this
phase,
next
of
and
on
balanced
most
the
country finds itself, of the pros¬ estimate I can make, I believe our
pect before us and of the policies policies are essentially right and
the country should adopt.
I would I commend them accordingly to
sum up those policies in this way:
the House and the country.
the
I beg to move,
Despite all obstacles, we must
That this House, recognizing the
strive to go on paying our way as
are going to continue to rise.
This
a
nation, particularly by pushing dangers of uncontrolled inflation
leads
to
less
saving and more
to the defense program, the bal¬
spending and so to higher prices, up the volume of our exports and
ance of payments and the stability
and at the same time again we economizing in imports where we
Because of the urgent needs of the economy, urges that every
have the phenomenon of the pull can.
home
version
market
the
to
home
to divert resources to
the di¬
and
for imports*
Nor
can
dangers*
ther
First, there
serious
other
ignore two
we
effort
defense and
be
made,
both
action and
exports, we must keep down ex¬
international
penditure at home, and from this
I certainly do not exclude those
parts of government expenditure
of
market
goods we ought to be exporting to
pay
in
at
it difficult
level
which
measures,
Continued jrom page
and
to check the rise in costs
prices and limit the pressure
of excessive demand.
compete abroad.
This
was
to
us
in fact
the major danger when my prede¬
originally introduced and
sought the collaboration of the
TUC
on
the
policy generally
cessor
known
as wage
restraint.
I do
think that until recently that
not
danger has been anything like
serious
was
be right for the prices of our ex¬
ports to rise.
I must, however,
give this warning, that the time
when this
danger will again become a seri¬
may not be far distant
particularly in the light
one,
of certain forecasts I made
time
tain
little
a
and particularly in cer¬
ago
industries.
^Secondly, the arbitrary re¬
distribution
involved
ments
income
of
in
which
inflationary
this
of
Railroads, representing
kind
which
.
is
move¬
It
is
always
fight
to
duty
our
against this, and it is certainly the
last thing we want at a time when
all
energies
our
should
de¬
be
cars,
Auto
decrease of 6,509 cars, or 0.8%
below the
but an increase of
13.3% above the comparable period of 1949.
or
Week
Output Reaches New Low for Year in Past
week, according to "Ward's Automotive Reports,"
with the previous week's total of
117,010 (revised) units, and 182,965 units in the like week of 1950.
Canada the past
totaled
97,842 units, compared
output declined to 95,493
units from
115,267 units, a new low
for the year.
In the like week of last year output totaled 180.284
units. Canadian output in the week totaled 2,249 units compared
with 1,743 units a week ago and 2,681 units in the corresponding
the United
For
States alone, total
last week's revised total of
1950 week.
Total output for the current
made up of 74,607 cars
and 20,886 trucks built in the United States and a total of 1,667
cars and 682 trucks built in Canada.
In the previous week, Cana¬
dian output totaled 1,358 cars and 385 trucks against 1,906 cars
week
was
What, then, is the conclusion of
analysis?
The trade union
policy of restraint
agree
our
contributed
national
efforts in dif¬
continue
to
pursue
which
very
recovery;
made it plain
we
all
greatly to
but
they
restraint which followed devalua¬
tion,
would
nor
do
have
reasonable.
I
think
been
On
the
of
flour market
domestic
forward
buying
featured by
a
continued lack
other large users held to
weakening in wheat values.
;advances
moderate
with
finished
Cocoa
was
the
bakers and
as
sidelines in anticipation of a
over
a
week
ago
reaction at the weekend. Manufacturer demand was
rather quiet but the market was sustained b,y the firm holding
policy in the Brazilian market and small olferings from other
primary sources. Lard and vegetable oils were firm, influenced
by the announcement of the government's plan to support the price
of cotton seed. Chicago livestock markets were generally steady to
slightly firmer.
A further moderate rise in hogs brought current
quotations to the highest levels since last February.
despite
some
Activity in both the futures and spot cotton markets was rela¬
tively the past week as traders awaited publication of the first,
official 1951 crop estimate, scheduled to be released on Aug. 8.
Prices worked irregularly lower during the week, reflecting sell¬
ing prompted by the expectation of a high yield and continued
slowness in the cotton gray goods market. Mill demand and buy¬
ing for export continued slow.
Sales in the ten spot markets last
week were reported at 46,800 bales, comparing with 39,900 in the
previous week, and 360,900 bales in the corresponding week a
year
ago.
The
mid-July
points to 33.85
parity
cents
per
price
for
cotton
showed
drop
of
13
marking the first decline
pound,
in
22
a
months.
that
possible
other
The
than
the
continued favorable, with better
the result of scattered showers
the belt which partially relieved drought conditions.
most of
over
of
condition
average
crop
noted
progress
as
Trade Volume Edged Higher for Week But Compares
Unfavorably With Like Period
While
there
period ended
on
was
slight increase in
Commercial
week ended
street,
and
industrial
failures
declined
to
149
in
volume
this
or
hand,
sportwear.
discloses.
Inc.,
1950 and
were
off
While
casualties
1949 when 194 and
sharply, 41%, from the
176
were
occurred
prewar
down moderately
respectively, they
level of 252 in the similar
last
week
was,
however, well above that in the
All of the decrease centered in failures involving
more,
and 155 in the
comparable week of last
wholesale
food
Aug. 7.
The
attributed
with $6.53
index
31 foods in
the
to
demand
volume
start
of
prices for canned
buying considerably in
as
for food
the
home
citrus
and
steady at a high level.
vegetables was partly
canning season. Somewhat
juices stimulated consumer
fruit
Coffee continued to sell well,
some areas.
did frozen foods and
was
fruits
fresh
in
dry groceries.
Resistance to the high prices of some fresh meats became even
noticeable than in previous weeks.
more
There
was
also
a
slight decline in the demand for smoked and
canned meats.
Retail volume in furniture
slightly the past week.
for
and electrical
Although there was
a
appliances declined
lag in the demand
refrigerators, washing machines, television sets, and the more
radios, there was a favorable demand for portable
expensive
radios and decorative household goods.
Total retail volume in the period ended on Wednesday of
week was estimated to be from 5 to 9% below a year ago.
gional estimates varied from the levels of
lowing percentages:
a
year ago
price index, compiled by Dun &
a
high at $7.31.
year ago,
represents the
or
rose
Brad-
6 cents
The current level of $6.95
an
sum
last
Re¬
by the fol¬
,
Middle West, and Northwest—6 to —10; East
to —5; South —5 to —9; Southwest and Pacific Coast —8 to
The. increased
the Fall
season
some
other
week
and
was
sponding week
ordering of apparel and home specialties for
than offset slight declines in the demand for
Wholesale dollar volume rose slightly in the
more
goods.
at
a
approximately the
year
same
level as in the corre¬
While buyer attendance at the major
about 9% above last week's level, it was'
ago.
wholesale
centers
below that in the comparable 1950 week.
to
com¬
increase of 6.4%.
total of the
was
Department store sales on a country-wide basis, as taken from
Federal Reserve Board's index for the week ended Aug. 4,
the
of
This marked the third successive weekly rise and the
establish the year's
The
consumer,
increased
lower
apparel. There was a noticeable increase
buying of children's back-to-school apparel needs.
1951, dcreased 15% from the like period of last year. A decline
21% was recorded in the previous week from that of a year
year.
sharpest gain since the week of Feb. 20 when it
pares
Clearance sales and intensified advertising campaigns
in the consumer
price
per
pound
of
general use, and its chief function is to show the gen¬
eral trend of food prices at the wholesale level.
and
ago,
decrease of 17% is shown for the four weeks ended
to date department store sales regis¬
a
Aug. 4, 1951.
tered
street, Inc., advanced another 4 cents last week to stand at $6.95
on
Bradstreet,
dresses and vacation
mer
liabilities of
which fell to 115 from 137 in the previous week
Wholesale Food Price Moves Higher for 3rd Straight Week
The
1948, states Dun &
summary
about 9%
week of 1939.
or
consumer
generally successful in encouraging consumers to buy Sum¬
were
the
Aug. 9 from 171 in the preceding week, Dun & Brad-
from
of 1950
buying in the
Wednesday of last week, retail sales volume con¬
a
tinued to compare unfavorably with that in the similar 1950 week
when scarebuying was prevalent and retail trade unusually active.
—1
a
that they could not
policy of extreme
the
The
—12.
the
circumstances
40,000,000 bushels in the like week a year ago.
vious week, and
New England,
Business Failures Decrease Further in Latest Week
$5,000,
world trade.
ficult
in oats was more
slightly firmer as the market recovered from the
lows of late July. Rye closed lower but showed strength at times;
on
the prospect of increased export business in the near future.Sales of grain futures on the Chicago Board of Trade last week
totaled 146,585,000 bushels, or a daily average of about 29,000,000
bushels.
The latter compared with 37,800,000 bushels in the pre¬
and 7-75 trucks in the like 1950 week.
making ourselves secure
maintaining our position in
leaders made great
anxiety over the
active with prices
in the United States and
voted to
and
article, a decline in market receipts and
stalemate in Korean truce negotiations. Trading
cash
The
decrease of 24,064 cars, or
a
Combined motor vehicle production
seriously
consequences.
a
Industry
below the corresponding week in 1950,
96,503
necessarily
be
can
disruptive in their
trended
of trade.
A slight rise in apparel volume
partially reflected the favor¬
able response to promotional
sales of Fall dresses, suits, and
total represented
week's
The
2.9%
creates strains and stresses within
society
the Chicago Board of Trade
on
Germany and disappointingly small country offerings of soft Win¬
ter wheat.
Corn prices moved upward, aided by firmness in the
preceding week.
so
present circumstances it would
ous
prices
Inc., in its current
5
The State of Trade and
earlier.
Indeed,
frequently been argued that
it has
in
it
as
Grain futures
irregularly higher last week in relatively light trading. Strength
in wheat was largely influenced by heavy export sales to western
Retail
puts
makes
impossible for
or
1950.
corresponding weeks of 1949 and
the
to
trades
export
a
compiled by Dun
trend downward the past week,
Aug. 6, the lowest since the 299.29 of Nov. 8,
It finished at 300.80 on Aug. 7, as against S02.09 a week
on
earlier, and 284.17 a year ago.
through
be fur¬
may
consequences
the
costs
our
wholesale commodity price index,
Bradstreet, Inc., continued to
internal
balance of payments if the rise in
wages
The daily
&
economy.
People begin to believe that prices
of the
Since November 8 of Last Year
eco¬
and to the
as possible
effect. And at a
place during the demand for manpower will
last
winter might do
serious intensify, we must ensure—I make
damage to the stability of our this special appeal to employers—
extreme wage re¬
straint ushered in after devalua¬
tion
the
increases which took
increases
reaction against
the
of
period
in
rise
wage
think, were partly
themselves, I
the result
we
the
to
prices.
and
have
mate¬
scarce
our
use
that a nomically
cannot escape the fact
therefore
must
rials—particularly steel and
others I have mentioned—as
Price Level Drops to Lowest Point
Wholesale Commodity
falling to 300.60
us.
We
Economic Situation
and
reason¬
can
be sought.
We must take
every possiDie step to avoid add¬
ing to the rise in costs and prices
wnich world inflation has imposed
ably
Britain's Financial and
productivity
economies
which
in
Continued
an
For, the year
advance of 5%.
Retail
trade
«m
New
York
last
week
closely
approximated
the unusually high levels that prevailed a year ago.
teethe Federal Reserve Board's index, department
Neyy York City for the weekly period ended Aug. 4,
1951, declined 13,% from the like period of last year. In the pre¬
ceding week a decrease of 18% was registered under the similar
According
store sales in
week of 1950.
For the four weeks
11%
to
date, volume advanced 9%
was
recorded
ended
below that of
tof
a
Aug. 4, 1951, a decrease
year
ago,
and for the year
from thejike period of last year.
Volume 174
Number 5038
.
.
The Commercial and Financial Chronicle
.
r
'
Continued from page 10
V /
*
■
f?mMll
WW
1J
M1S1HASS ullll AAViMH
HflldC
vMWMiviiif
villi
.
vulnerable to
v
■
their products. Profits so far this largely to finance inventories,
year bave been &ood> however, these are continuing to rise.
and
*
■
in
m
the
ine
gram, or in
consumer
Scheduled
'
Current
armament
armament
spendmg.
Programs
levels
of
sur-
economic
ernment
is, of
most
impor-
the gov-
course,
spending for the defense
Total
program.
the
The
ones.
Federal
expenditures
Government
by
for
all
goods and services during the last
12
months
were
$45,000,000,000,
$3,500,000,000 less than the
about
amount
received
at
are
from
taxpayers,
expenditures,
Current
however,
the
annual
rate
of
$62,000,000,000, which is
ably
about
consider-
than tax receipts. This
spending is scheduled to increase
'to at least $75,000,000,000
more
early
next year, unless the reduction in
the expenditures for
military sup-
plies and equipment is much
than is
now
much
Qf
the
time
in
tained
to
as
being
are
nut
production
of
military
sup-
plies and equipment.
•
effects
will
be
of
military
ma-
demand,
higher cost
living
of
time. Several of them
some
the lowest levej in
are
at
extent of the
months,
many
place. Yields of high grade
corporation bonds have risen to
over
3% which is the highest in
The index of commodities in the
wholesale markets which is
inflation which will
take
pre-
pared by the United States Bureau
Yields
many years.
of Labor Statistics reached a high
point of 184 in March, a gain of
bonds
ernment
2
on
have
some
gone
year,
amount and
Most
financial
favorable.
arg
-337,
decline bf 16%.
a
It
is
still firms
Residential
1"? ».this index
Prices in
is
the
August, 1939.
evel of gain
has
The cur- weeks.
up
indicators
Business
become
Totals
the current
are
$4,000,000,000
to
by
monthly
rise
the
middle of next year. New orders
are
being
close
to
placed
the
at
$4,000,000,000
■Unfilled orders
total
now
rate
of
monthly,
$21,000,-
■000,000 and will continue to rise
■until the rate of deliveries
the
rate
■these
of
orders.
new
figures
one
in
should
are
■five,
•they
to
equals
To keep
proper
perspecremember that
be
compared
with
total current manufacturers'
out-
put which is around $24,000,000,.000 monthly. Production of military goods even at the high point
.will
of
be
only
total
small
a
output.
For
very
high prices for
industrial
and farm products. ^
Food prices, and the
.
materials
raw
facreas? ha? been^ due^o
ratio
of
inventories
current
times
many
in the
past.
to
Among
failures
retail
field
inventories
>
are
equal to one and one-half months'
sales as compared with one and
one-third months in the fairly
stable period of two years ago.
Consideration must be given to
the
fact
current
that
large
a
unfilled
portion
orders
held
of
by
manufacturers does not represent
normal business demand. Allowmust
ance
be
made
recent
at
peak levels,
further increases
and
also
for
expected.
A
substantial
the
of
part
,
in-
credit and also by the increase in
consumer
strict the
Efforts
credit.
use
produc-
to
re-
of credit have been
only moderately successful, as the
trends in both fields are still up-
economic
ac-
types of goods reflect these
conditions of large inventories in
many
those fields.
One of the
auction
of
places in
large is in
very
consumers. Pro-
these
goods
rapidiy
several
many
it have fallen slightly.
™"®u"?etvs ™ore
wl." "?e even, larger, and much
changes
.
will
it
in
be
of
rioth"-6' comparsion
.
Another
significant
is
that
major
,
that
is
and
become
than
present
stronger
costs
rise
further,
no
sig-
mfjeant changes in the cost of
living
expected
the next few months.
between
at
are
during
the
and
includes
is
fairly
a
all
expenditures
good
.y,
activity,
measure
to
Trends
in
security
prices
a'sothe,y
reduced their hold-
'T'1 f^
past year.has not yet
of
^wever «
son with the
k
R
Bank
The.total amount
credit
consumer
credit
credit
dustrial,
are
determined by quite different facueteixmiieu uy quue uiiieiexu jae
outstanding,
hi|h
current iricompari
volume of
used
used
bv
business
by
business
.
made
and
agricultural
by member
banks
loans
the
of
Federal Reserve System in
lead-
is
.
Some Soft Spots Have Appeared
commodity
cudties
prtoes
rose
Prices
of
se-
to the highest levels
Favorable indicators in producition and trade as well as in the
in
20
of
March.
•.scheduled
during the last 12 months
down, and the mills
ing less cotton than
year
anticipated
shortages in raw materials and
greater
restrictions
of
civilian
was
are
now
they
us-
did
a
Exports of cotton have
ago.
also dropped.
-
Outnut of coal
steadilv
has
hcon
Hcclin
but
even
outnutkla'reer^
the reduced
than
current
mand
and
of
stocks
He
hand
on
are
Sto MhTteS
because of hiJher S
iarce
verv
fuel
has reduced
the
demand
for
coal
reduced tne demand lor coal.
Agricultural Prospects Very Good
Outlook for larae m-oductinn
the
farms
the
has
crops
improved
and the
summer
most
in
manuhave been declining for
the [ast twQ months and nQW are
of loans have also increased by
least 15%. Large expansion
than they were
a year ago, hbwthey are alsQ larger
than current production. As a reand
^
sult unfilled orders have risen to
a
the
was
olanted
acres
largest
in18
and in onlv four vdars have
years
the
fol
thanliver
outlook
is far better
The number of
crops
on
durine
harvested
acres
principal
crops
of
the
52
been
SStraSr
•
The wheat cron
vested
will
total
being har.
than
more
1
-
The decline i'n
winter wheat has been more than
000,000,000 bushels.
offset
thg
exceptionall
large
output of spring wheat. The total
supplies
of
wheat
will
not
only
be adequate but also larger than
anticii
domestic consumption and
pated exports.
times
The
corn
crop
is expected to
to 3,300,000,000 bushels,
although much will depend upon
those
0f
a
year
aS°- I" the durable goods field
j
t
b
f
weather conditions this month. In
only
two
previous
vears
has
Otto
crop
the
feM^
{fen in machinery and transport^ grains,- inql^to^
^ ^yn^ordurable1 goods
other
d"rable g00ds
Unfilled
consumers.
h,
H
orders
hnvp
lor close^rec^d^amounts' The hay
close-to-record amounts. The hav
for
for
appiin^
crop
iroJa
is
the
largest
e,mniiflo
,xm-ii
ever
ho
"°nd^uraible goods have deduied Feed supplies willi be
witt ttoe largest drops fa those for prodimmg the
?i»niPficMt\?thl decltoe
raised.
amplei for
maMnrnm^quantaj,
nets
"cls-Ajso signmcant_is me aeenne ucts.
hvestock and P°uItry Prod"
■
,
changes
in
this
the past changes in this field have been most
field
at have often forecast trends in the only many more
0f capital goods industries, although ais0 indicated
declined and also recovered
now
eak at more than two and total close
„
one_half
months'Lfe Most of the rise has
in
measure io
nr_
n
' nvpr <nc nnn
currently tors than
those
in
commodity mg cities are now over ij>o,uuu,around
$315,000,000,000.
Here, prices, but they are also impor- 000,000 larger than they were a
too,
the
economic
activity of tant indicators of current condi- year ago. For the banking system
individuals
is
far
greater
in tions as well as prospects for the as a whole the increase has been
•amount than the activity of gov- future.
They have often forecast larger in amount, with about the
eminent, even though that spend- business conditions even further same 40% gam over last year.
'ing is very large.
in advance than have changes in Real estate loans and other types
ing
rge.
overall
ton
age
as
New orders received by
co^su^^eU^c/mZctal
Security Prices Wavering
.which
of
greater than during the preceding
year, the trend has recently been
ago
months
facturers
Unless been paid[for.
pressures
Stocks
high in all
very
J3ds
recent weeks the index has been ^rylarge volume of
inflationary
are
has been holding barely
steady,
Although the consumption of cot-
spurted
businessmen
The cost of living or consumer
price index, which includes a ered, and the total is now very suit is that production trends in
representative selection of goods close to the peak. Not only are these fields are downward.
in
appliances.
hand
on
larger than
ward. Consumer credit has in- production than have
yet been they will be this vear
Prospects
creased $2,000,000,000 during the made.
.
for
MrTcre are
last year and is now over $19,000,At the game time the demand
£jdered
excellent
and
most
of
000,000. Most of the decline of a for these
types of goods has them will be much higher than
few months ago has been recov- become less intense, and the reeven the good crons of last vear
311 goods be quite stable'.although.someitems
,be large, but other
goods
the
tions efforts by many retailers and
substantial
price
reductions
on
crease in business during the past which stocks are
cost of liv- year has been financed by bank durable goods for
have ' risen- by
somewhat
smaller
percentages,
but
they
have declined very,-little. The
D"n & Bradstreet index of the
wholesale prices: of 31 foods has
held very close to the high point
of $7.20 which was reached in
February.-'It is over 20% higher
than it was a year ago.
ing
in
less
are
television, refrigerators, and
,
^e effect of the mihtary program.year and is considerably higher 'JgfnffOf|°Fer™ientob^dSfandcoming in at the lowest rate since
£pUm
£e we^s unated nor than it has ever been before rn
should the changes m the
A^rtem of tte last December. They are larger
%
been
hieher
orders is lower than it has been at household
r
and services that make up the
percentage normal family expenditures, has
that reason risen about 10% during the past
ignored. The defense program will
has
n
promo-
many
scheduled
building
retail and wholesale establish- these lines, however, and no seriments the ratio of inventories to ous shortages are likely,
to sales has risen only moderately. In■■■;
Output in the textile industry
facing in meeting added
are
however,
are
years.
period.
among falling .°tf thr°ughout most of the
manu^acturers' r e ^a 1 J.e r s' and year> although there was a mod^
y lndicate that erate increase in June. The numJ1.
aJ^ °f the past large ^produc- ber of dwelling units started dur-
the
other
rent position of the index reflects
and
and possibly for the last quarter
of the year as well. Even after
these reductions output will be
high as compared with previous
gov-
%'%.■■
.
month
■
$16,-
year established a new record,
feeing
many
terials and Equipment are now at
a
rate of about
$1,500,000,000 a
■to
of
half
but declines of at least 30% are
scheduled for the third quarter
,
industrial out-
on
Deliveries
Pro-
1950.
first
The
business
30% above the low point of last materials and labor cost as well
unbalanced conditions
in
many
While this spending will ulti- year, howevej. and the rate of as
the difficulties in getting sup-' lines
where stocks of goods are
mately affect all aspects of eco- decline has recently been slow- plies. Bank deposits are
steadily excessive in comparison with curnomic activity, the most direct ing downThe base period or increasing, although the rate of rent sales.
Special sales
put.
to
the
m<rreas® has been due to higher 2oVWe/than rfnrW the cor20% lower than during
prices, but physical quantities are responding period last year. If
consumers
have
less
to
spend justments which, are
likely to be
° mu
larger.
present trends continue the reafter paying for necessities than needed in the future after the deInventories are not yet exces- auction in home building from
they had a ygar ago.
fense'program is completed.
sive> although the trends of the the record high of last year will
Commodity/price changes reBond prices have declined and last year cannot be continued in- be less than was expected, and
fleet these conditions in a very are about
3%
below
the
high definitely. In manufacturing, for close to 1,000,000 dwelling units
striking wayv Although all the point of last
year. This downward
example, stocks of goods on hand Wl11 be started.
;
major priceMin£exes are higher movement reflects not
only the are $9,000,000,000 larger than they
Trends have been downward in
than they were a year ago, most higher interest rates on
money
were a year ago, but unfilled most of the consumer durable
of them have been declining for hut
also the uncertainty as to the orders are up $32,000,000,000. The goods lines,
especially in radios,
curtail
the
could offset some of this increase, the index is now at 180. The inremain at a
low level as comThey have changed that much in dex °f 28 basic commodities which
pared with normal and so far this
the past, although they are not fluctuates quickly in response to
year
have been- less than they
likely to do so now. In fact con- changed conditions of supply and were a
year ago. In recent weeks
sumers are
likely to spend more demand rose; to 390 in February, there have been some
increases,
•as their incomes increase as
a rean
increase or 57%
in
a
year, however, which reflect some of
suit of the amounts
pafd out for Since that time it has dropped to the
difficulties
which
business
the
during
th<P mcrfasld have fbe*en takmg. p*ace
meet
High prices have tended to back into the business in
capital
and because of expenditures
Larger reserves are
year.
Pany pre®ious
previous
year
the
in nercentase has been larger than
in
any
duction
27
and
peak of $70,-
new
they normally
earnings
earnings
20% in a year,. Since that time
spending the trend has been downward, and
business
a
as many com- The increase both in
paying out as much
re-
expected. Changes in
and
consumer
more
all
smallerare not
Percentage,
pames
weeks, but the physical WOrking capital reauirements
at
activity will be modi- quantities of goods sold have ofthe higher orice level
Also more
during the coming months ten been less than they were last
0f
the
tantof these
for
000,000,000, an increase of
000,000,000 during the past
cent
by forces other than the normal
inventories
have reached
by somewhat
industrial
fied
total
of their
during
and
are
passing even the record earnings
increased, although
able.
Large
business
companies
Commercial bank credit is used
?f last year- ,Dividends have also
is becoming,
is becoming increasingly unfavorincreasingly uniavor
nro^
prOi
or
for many
.
_
www*
changes
cnanges
Inventories Are Still Increasing
volume
WW" J-L, W
□IGfl(lV wmm A Ilia It LfiVfil
«tf
1
any declines in sales
in selling prices of
>■'
'
.
'-•'1%
(619)
•
■
striking with not
planted, but
yields
per
acre
acres
•
-have
been
program
offset
for expansion
to
Some
extent
years
during the first part hank credit has. often been a charthen they have acteristic of conditions in business
some
Just before a period of decline,
Since
of the loss.
\ndipftor^es^reliabto
??ake ithLhlpn^t
J
thai^ jit hais^been^ it olther times,
^ £
of more mod ate
s
nth
ah°ve average. If weather
C°
nonS1!! favorable a
crop of 18,000,000 bales is possible,
It represents an above-normal
as compared with 10,000 000 bales
rate of expansion in industrial
n^t
last year. That amount will be
activity and also purchasing by future than some o
r
igur s more than domestic consumption
-strong enough to reduce total in- direction around a point about business in advance of needs. If might seem to indicate.
and exports.
;dustrial production nor business 5% below the
peak. The averages It is continued too long, a period
n
..
.
Pri<%es..of. fa^m Products have
.volume, but they do tend to pre- are close to 20% higher than they °f
readjustment is needed in
Some Declining
dus
been declining in recent weeks as
-vent or hold down any upward were a
year ago,
but there are order to bring it more nearly in
Among
the
industries whose crop
prospects
have
improved.
; rise which would otherwise result
many wide variations among the tine with normal growth.
When output is declining, the most strik- They are still higher than they
iby
downward
-lines.
These
trends
have
in
not
many
yet
been
During the past month
they have been fluctuating without any definite trend in either
u
.from the large spending programs,
.Retail sales to consumers have
Jleld tbarely steady, and in
different individual
securities.
>
Security prices reflect not only
some business activity but also the out-1
that
how
change
long
will
it
take
will
be
place and
ing
continued
Weekly output of
cannot be determined in advance,
lines they have dropped consider•
look
ably.
Many companies are being stead- h°wever> and ho signs have
ily squeezed by higher operating, appeared of any reversal in
costs which Jeave them extremely upward trend.
*
In
comparison
,
with
sharp upward spurt in sales
•
ago
the
current
volume
a
of
the
year
sales
for
profits
and
dividends,
onrl
v,n„a
vot
yet
the
is
the
automobile
cars
industry,
and trucks
were
a
year
ago,
however,
has dropped from close to 20M00
earlier in the year to less than
150 000
very
now.
The decline is from
a
high level, however, and the
current rate is still above that of
and
farm income is holding up quite
fromUoth
indicated in the income trom ootn
crops
and livestock. Monthly farm
income is currently running well
above $2,000,000,000.
The Commercial and Financial Chronicle
28
Continued from page
Recent
Treasury
3
Developments in
order
to
sellers
this concept
of the sacredness of par was de¬
fended on the grounds that a de¬
cline in prices below par would
be unfair to the buyers of govern¬
sirable
repercussions upon finan¬
institutions, upon the opera¬
tions of the Treasury, and upon
It
in general. As late
1948, public statements of re¬
sponsible people in the Treasury
and in the Federal Reserve Sys¬
tem revealed close agreement con¬
cerning the sanctity of par.
merits
the
of view, the necessity of
protecting par and of safeguard¬
ing the 2$% rate severely handicaped the Federal Reserve in the
use of its general powers of credit
control during the postwar years.
Because of the closely interrelated
character of the government secu¬
under longterm government obligations car¬
ried with it the collateral neces¬
sity to maintain a fairly easily
rities markets,
discernible
the
peg
prices and
pattern of
of
folios
for a final
too early
is still
post¬
years against an unpegging
government bonds h ave not
by the actual
been substantiated
of events.
course
of debt management.
Perhaps
approached
it
an
this
and
caution.
The
task
jections to a restrictive general
credit policy, with its corollary of
higher interest rates, were based
(1)
carrying
Federal debt and
to
would
thus
already
an
on
be
the
most
in
importance and it must
—
be held within reasonable bounds.
simply
policy, it should not be re¬
garded as a decisive factor, out¬
weighing
other considerations
which
have
far
1
1
1
cance.
signifi¬
greater
.
(2) Another Treasury objection
Early in March of this year, it
recalled, the Treasury of¬
holders
the
of
$20
nearly
imparted an extremely high de* billion 2V2% bank-ineligible bonds
gree of liquidity to all types of of 1967-72 the opportunity to ex¬
government
obligations.
Under change their securities for a 'new
such conditions, the stated matu¬ very
long term nonmarketable
rity of a government obligation bond bearing 2%% interest. This
had little significance to many in¬ offer was accepted by holders of
vestors. There was a strong temp¬ more than $13 V2 billion of the mar¬
tation to reach out for longer ma¬ ketable bonds, including Federal
turities in order to obtain a higher Reserve and government invest¬
return, and what were essentially ment accounts comprising about
short-term funds were frequently $51/2 billior^ No doubt, this con¬
invested in long-term securities. version offer importantly reduced
This
temptation
was
especially the volume of liquidation that oth¬
strong in the immediate postwar
years when the low wartime rates
short-term
erwise
unpegging.
governments were
The
still in force; later, this tendency
was moderated by the increase in
bonds
<m
short-term rates after the middle
of
1947.
Credit Restraint and Unpegging
—The monetary authorities were
insensitive
not
to
the
inhibitions
which the pegging of government
bonds laid upon the exercise of
might have followed the
' •/-
;
unpegging
March
on
cipitate
government
of
12
did
not
pre¬
downturn of
prices. During the period of the
exchange offer, the Federal Re¬
severe
a
serve
made large
port
of
purchases in sup¬
support
continued.
operations
were
and
certain
classes
of
investors,
notably the commercial banks, re¬
mained wary about unduly length¬
ening
ernment bonds
were
Gov-
permitted to
remained
at
conse¬
99
or
Federal Reserve
was
able to with¬
completely from the long-
below par, and the
maintaining
would
cessful in
a
good many years.
a decline in government bond
prices below par would encourage
the redemption of savings bonds
and would thus increase the cash
drain
the
on
Treasury. The record
reached
quarter
tions
E
occurred
bonds
pronounced
attract
bond
in
almost
entirely in
of
$100 or more face
value. In part it reflected the use
of
savings for the purchase of
durable
sumer
housing,
funds
as
and
into
goods,
in part
con¬
including
a
shift of
investments
suited to
more
:
sures.
The
!
regarded
inflationary
an
funds.
market,
a
The
which
mu¬
had
big rise for several
preciable
since
off.
of
government
has had
became
latter
half
1950.
funds.
for
The
since
record
seems
and G
not
as
views.
general,
In
become
able
ferings,
attractive
as
on
It
cent
in
declines
bond
emplified
bond
declines
bond
prices,
coupled
real
and
been
million
have
have
been
adoption
A
a
is
policy.
The real estate
market has also been
affected. For a variety of reasons,
mortgage
including large outstanding
mitments
failure
the
and
com¬
the
of
on
a
extent
of
of
competition
investment
Consequently,
have
in
curtailed
and
outlets.
institutions
some
others
have
lenders to provide
interim financ¬
ing for new real setate ventures.
The volume of
corporate financ¬
continue
at
relatively low levels.
However,
make
these
the
investors will
Treasury
savings
bonds
could
more
have
policies
been
able
and
to
sell
the
policy
abate¬
has
that
been
much of 1951.
factors
many
the
to
inflationary
credit
policies
recent
have
easing
in
that
this
niade
some
pressures;
operated
direction and doubtless
•
contribution; but that the underlying causes are to be found else¬
in
where
The
the
economy.
Subsidence
The
of Inflation —
inflationary boom of a year
ago
originated
the
fear
in
the
shock
to
and business psychology
consumer
the
from
outbreak
of
Korea, coupled with
the
that
war
might
de¬
world-wide con¬
flagration. A great wave of scare
buying swept the economy; the
government stepped up its stock¬
piling
operations;
businessmen
sought to increase their inventor¬
into
velop
ies
and
to
a
accelerate
plant
ex¬
pansion programs; and consumers
scrambled for
goods of all kinds.
With the passage
nancing
on
larger
that
is
contributed
resulting
have not risen sufficiently to keep
develop¬
Perhaps the most realistic conclu¬
sion
E bonds and of F and G issues
of
inflation
hostilities in
loans
mortgage
for
evident throughout
terest
on
which
to
responsible
The
part
more
government-guaranteed loans, in¬
rates
generally vindi¬
ment
the
credit
re¬
policy
fundamental, and in a
important question,
more
the
more
:0'W'S: ^
,
.
a
Reserve
were
as
restrictive
more
Federal
ments in the field of credit
issues
since
postponed
of
institutions.
of view advanced
far been
so
sense
op¬
much
as
financing. There have
for financial
or
strictive
credit
municipal
of
of
this
decline
subsequent
by the proponents of
the
that
estimated
$500
earlier
Thus the points
program,
curtailed
unpegging
the
re¬
the
the
bonds
troublesome results either
no
tions
large
voluntary
ex¬
for the conduct of Treasury opera¬
municipal
with
de¬
new
policy
prices has contributed to
estate
been
have signifi¬
volume of
municipal financing. It has
cantly
new
the
r
with
fects
prices has
in
and
tightening of lending poli¬
the most obvious ef¬
apparent in municipal and
some
cies,
municipal and real estate financ¬
The
Policy
credit
by
and
year
in
been most evident in the fields of
ing.
in
government
substantial flexibility in their fi¬
the
bor¬
expansion
is apparent that the
purchases of larger denomination
is
would-be
further
a
Credit
velopment
that
outlook
in¬
un¬
effective¬
the
marginal
when
underwent
lag
of time, how¬
environment
economic
the
ever,
The
of
the
Inflation
ing has been well maintained in
recent months; corporations have
issues.
increase
to
a
cated
The restrictive effect of the
mortgages. In turn, this has helped
to
reduce
the
willingness
of
are
that
of the other policies of credit
General
credit
private
stopped their acquisitions of new
market¬
clear
seems
of loans would necessitate the sale
less readily available
the
bonds, where the yields
it
down
the
recent
months, the decline in sales has
been especially pronounced for F
evidence
restraint, it is much easier to turn
to support their
unpegging
other
in
finds
one
widespread
ness
institutions,
lending
of
policies
with
In
Here
creasing reluctance to make loans,
rather than upon the requirements
attractive
decline
the
significant
of
are
the thinking, poli¬
general
changes in interest rates upon the
them
how¬
important than;
lending
moderately
of
proponents
leveled
have
less
are
officers.
higher rates, on the other hand,
emphasize the' effects of small
savings
year
have continued
which
ap¬
redemptions;
on
tljis
redemptions
no
Sales of savings bonds,
ever,
expectation of
higher tax rates and reduced of¬
hit with particular
With the better tone in
in
par
effect
March
bond
the
was
decline
below
v
;bank
on
'
authorities to increase the rates
The
nicipal
of
1951, before the un¬
pegging. The increase in redemp¬
bonds
more
to
in the
peak
a
of
cies and points of view of
loss.
that
statistics
the
the changes in
significant
(3) Finally, the Treasury feared
effect
upon
the market for corporate
and municipal obligations.
Cor¬
porate bonds declined consider¬
much
loans
bond prices undoubtedly have re¬
difficulties duced the eagerness of some fi¬
for Treasury debt management. In
nancial institutions
to
increase
fact, the latest exchange offering their lending power through the
of the Treasury was the most suc¬
sale of government securities at a
policy had
The change in credit
a
Perhaps
in recent months. The declines in
no
marketing
,
tively deal with inflationary pres¬
both
posed
seasonal
the
of government securities at a loss.
avoided
rigid
control and of chaos, and has im¬
ac¬
recently,
more
spending by governmental bodies,
and consequently could not effec¬
has
of
con¬
rower
by the Federal Reserve
past
months
has
evils
defense
spending on plant and equipment
or inventories, would not restrain
the
the
finance
defense-supporting
commodities.
business
decrease
not
during
era.
term market.
policy of severity.
pegged price levels governments, however, this seg¬
ment of the market recently made
was superseded by the more flex¬
ible policy of maintaining an or¬ an especially strong recovery.
•'
derly market. With the Federal
Effect on Treasury Operations—
Reserve enjoying more discretion Doubtless,
objections
by
the
move
road
they
served
restraint
months
credit restraint.
traveled
middle
than
Where business
ago.
pegging of government bonds has
1950
powers
general
The
one.
and inflation. A
argued,
was
first
experienced
of
chaotic
portfolios
and,
normal
record
at
increased, it has been
to
tivities
re¬
would not signi¬
ficantly reduce personal consump¬
tion and increase personal saving,
it
and
greater
its
be¬
made
rigidly controlled, metic¬
ulously regulated market, and a
a
chiefly
credit
modest increase in interest rates,
cantly in the latter half of
bonds
Reserve
of
choice must be
a
tween
some
has taken effect,
already
year
tracts and
credit expansion
able
order
use
that
a
And
inventories
With the unpegging of the gov¬
ernment bond market, the Federal
the
mar¬
were
loans have
ly small increases in interest rates
could not
effectively cope with
of
and
portfolios. However, ably, the differential between the
investors doubtless con¬ yields of corporate and govern¬
ducted their operations on the as¬ ment bonds widened substantially,
sumption that the support policies and new offerings had to be re¬
would be continued indefinitely.
priced at sharply higher yields in
latitude in
securities
government
It does not follow, however,
ket.
and
less inclined to add to
loan
and
eration
market
their
gained
ized
demoral¬
a
re¬
commercial banks, with
are
their
and that relative¬
dealers'
the
j m a n y
System
greatly complicated by
voluntary
loans
levels,
inappropriate
was
in our economy,
shows that redemptions of savings
bonds began to increase signifi¬
this pol¬ draw
In retrospect,
icy probably was moderately ef¬
fective; there was no wholesale
liquidation of shorter-term issues,
refunding operations would be
ury
credit restraint
a
quently the longest term market¬
higher. In April, after the conver¬
credit restraint.
In the course of sion offer expired,
the Federal
the postwar years, they developed Reserve substantially reduced the
of
the so-called "open mouth" policy volume
support buying and
by means of which they attempted long-term issues slipped to levels
to maintain enough uncertainty as below 97. Late in June, however,
to the future course of interest with the appearance of truce pros¬
rates to prevent investors from ig¬ pects in Korea, government secu¬
noring maturity features even rities evidenced strength and the
while
of investors. It is true that Treas¬
that
was
the
in
the high levels
over
program
their
higher interest
drastic use of
involving
rates,
loans
inventories
the
and many
Effects on New Financing—An
important
argument
against
a
more
restrictive
general credit
policy,
concern
time,
insurance companies.
and
moderating
business
business
straint
levels
credit
period of
for commodity prices. At the same
change in general inter¬
do not jeopardize
a
rate
est
of
quarter
a
uncertainty regarding the outlook
the ultimate solvency of our banks
will be
fered
ing
of
reflect
which
prices
early
boom.
war
cent months have been the mount¬
based
However, in the determination of
the Bond Market —
was that an unpegging of govern¬
unpegging, there was
ment bonds might complicate the
some
opinion that a decline in
task of refunding maturing Treas¬
government bonds below par
ury
obligations.
The record to
would have drastic consequences
un¬
date, however, shows that
throughout the bond market and
pegging has not interfered with
might elicit large-scale liquidation
the subsequent refunding opera¬
of government securities and other
tions of the Treasury. The success
fixed obligations.
Actually, un¬
or
failure of such refundings is
pegging was accomplished without
influenced less by the level of in¬
any
signs of panic and with a
terest
rates
prevailing
at
any
minimum of unsettlement. Aeon-*
Liquidity of Government Secu¬
This > situation
inevitably
rities
of
cases,
market
sizable
the
second
factors
the securities can be
maturity, so that declines
held to
ter of real
the
the
of
is normally
year
growth
enough to raise any question
minds of the public with
Admittedly, the carrying
cost of the public debt is a mat¬
like
typical
Other
regard to the safety or solvency
of the
financial institutions.
In
add
is difficult to
seasonal decline in business loans.
the
in
budget.
Effect on
Prior to the
government securities market.
insurance policy¬
fear, likewise^, has
a
tial
Treasury securities of
maturities, which would
supported, if required, through
given time than by the willing¬
purchases by the Federal Reserve tributing factor was the action of
ness
of the Treasury to offer se¬
System.
Consequently, for most the Treasury, which undertook to
curities which, on the basis of in¬
of the postwar period, the element remove a large part of the longest
terest
rate
and
maturity,
are
of price uncertainty was mini¬ term government debt from the
adapted to the rteeds and desires
mized throughout all sectors of market.
yields
various
This
bank
among
anything
However,
the
comparison of market prices
and cost or other carrying value,
the losses have not been substan¬
on
Treasury
huge
or
folios doubtless show losses
the
of
cost
shown
not materialized. While some port¬
such
the
uneasiness
to
holders.
fundamental contention
a policy would in¬
A
that
since the unpegging
appraise. Recently they have not
impair the position
might
depositors
three major grounds.
on
increase of interest rates
depreciation on bond port¬
lead
ob¬
Treasury's
postwar years against an un¬
of financial institutions and might
overabundance of timidity
with
crease
war
point
Treasury with a delicate and ex¬
acting task
was
this guments advanced during the
of
months of the Korean
securities.
appraisal of the new Federal Re¬
serve policy and its consequences
upon the credit situation* and the
economy.
However, the experi¬
ence of recent months has already
demonstrated that many of the ar¬
economy
and
"Unpegging"
of
Effects
The
as
Whatever
market.
reduced, and price
has become a more
market for Treasury
cial
increases
consideration in the
important
.
business loans
behavior of
The
—Another argument
sulting
would-
bonds has been
unde¬
Financial Institutions
advanced in
on
issues around
new
midyear is lower than might have
been expected. •. r
-
freezing of the government bond
market was the fear that the re¬
reliance
of government
Thus, the liquidity
uncertainty
Effects
the volume of
greatest single factor in the money
and
capital
markets,
left
the
to absorb
the investment
to
market conditions.
new
the
the willingness
Reserve
extent
In the postwar years,
the
to the
unprecedented wartime increase
public debt, whereby gov¬
ernment
securities
became
the
of the Fed¬
their of¬
ferings, and must look to a greater
eral
government issues.
ment bonds and would have
its
upon
investors
encourage
to subscribe to
'
Thursday, August 16, 1951
.
.
in the
support operations,
can place less
in
be
The
earlier in the postwar years.
adapting their yields
attractive by
potent
most
Fed¬
eral Reserve to change its policies
permitted on marketable Treasury
obligations. This notion originated
at the time of the war-loan drives
in
the
were
the failure of the
in
factor
Federal Reserve Policy
•
.
(620)
an
important
change.
defense program
tremendous productive ca¬
in
the
generally
and the
their
pacity of American industry en¬
abled the industrial machine to
curities provided they were
se¬
will¬
the
ing to make the coupon rates suf¬
meet
ficiently attractive. However, even
here there is some evidence that
mands
same
of
time
greatly
increased
de¬
and
the
consumers
build
up
at
record busi-
Volume 174
Number 5038
.
.
.
The Commercial and Financial Chronicle
(621)
inventories.
ness
calmer appraisal of in¬
ternational prospects, and the war
fever
gradually
subsided.
and
Good
be
can
adapted
crop prospects resulted in an eas¬
conditions with
ing bf prices of
lay
agricultural
many
and
also
Of
vance
restrained
prices.
some
the
ad¬
Gradually
it' betame evident that the defense
presently
program
would
1 still
contemplated
leave
substantial
amounts of goods available for the
civilian market. All these circum¬
stances1 have
contributed
change in business and
to
to
changing
minimum of de¬
a
difficulty.
Changes
need
credit conditions,
in
for
a
and
costly
enforcement
a
elaborate
macninery.
iness prospects.
The Role
is tne latest in
which
of General Credit Pol¬
took
our
policy
during
have been
II
relaxed.
firm stand against the
a
un¬
pegging
even of short-term inter¬
rates, and documented its point
of view with a formidable
presen¬
prices in 1951. General credit pol¬
icy has' been merely one of a num¬
in
War
In 1945, the Federal Reserve Board
icy is not the major factor respon¬
sible for the change in commodity
factors
"the
credit
on
World
series of steps by
shackles im¬
a
Of
some
posed
rec¬
ognized that restrictive credit pol¬
of
Over
*
governments
\
.
period of time, however,
a
the financial
doubtedly
institutions will
adjust
un¬
themselves
to
est
economy
tation of the dangers inherent
the current level of interest rates.
credit
likely
policy of spaced maturities, for
example, would gradually enable
financial
institutions
to
ties if other investments
at
of
Thus
re¬
another rate increase
modest
proportions in an al¬
ready unpegged market might be
less
effective
in
the
future
than
the increase that
accompanied the
rather
spectacular
ging. If the
act
of
unpeg¬
monetary authorities
should desire to keep lending in¬
stitutions
under
pressure,
they
eventually have to acquiesce
may
to
further and substantial tight¬
a
ening of interest rates.
Limitations
Credit
on
and certificate rates were unfrozen
greater flexibility of action avail¬
in interest rates
and thereafter allowed to rise.
able
to the
tle
the latter
tem
will
of
when the
spending sagged and personal sav¬
ings rose sharply in the second
quarter of the year, but the change
probably had lit¬
nothing to do with it. If any
or
credit
contributed
measure
nificantly to this end, it
ably
the
credit.
not
regulation
While
caused
turn
in
credit
important down¬
any
the
amount
of
consumer
normal
the
reaction
earlier
were
consumers
overbuying
sures.
The
recent
past
demonstrate that the
Federal
Reserve
there
a
Federal Re¬
of
prices
were
low¬
in
uses
in the
not
volume
par
until
this
case
year
that the
authorities, after
plant and equipment is at record
careful study of the prob¬
lem, believed that conditions war¬
levels.;) There
ranted
for
firm
a
in
stand
favor
may be a few in¬
stances, in > which business man¬
allowing
agements
lack of available financing on sat¬
stantial
isfactory terms
since
of
bonds to decline below par.
are deferring expansion
plans, but whether this is due to
moot
building,
to other
or
point.
In
It
causes
in
residential
the
lack of financing has unquestion¬
situation
prevail in the
end
case
eral
economic
reliance upon
tion between
public improvement programs,
In each of the two latter cases, the
lower
of
in
ure
the
mands for
a
growing
future;
labor
as
War
II
Reserve
policy places strong
the subtle distinc¬
rigidly
a
pegged
government bonds and
a flexible policy of occasional sup¬
port.
In
a
market
determined
meas¬
yet the de¬
and materials
World
place
market for
levels, of building and construc¬
tion will be felt in
of
taken
sub¬
the willingness of the Federal
authorities to employ a
of
consequences
has
a
largely by the portfolio policies of
large institutional investors, this
as
result of projects
already under
distinction is certainly important.
way are still relatively strong.
In assaying these developments, A basic question which cannot be
it is apparent that many other ancwered as yet is whether a polforces have been operating in the icy of general credit restraint in¬
'
general
same
direction
the
as
credit
volving moderate increases in in¬
terest rates
be kept effective
policy of the Federal Re¬
System, and have increased unless rates are increased repeat¬
of that policy. edly.
Conversely, it may well be that
Effectiveness of Moderate Rate
the restrictive credit policies of
Increases—So far, the new Federal
the past months have strengthened
Reserve
can
has
been
possible
decade. However, it
kept in mind that the
o^ restrictive ^redit policies
kinds
draught
are
difficulties
and
flation
to
available
tant
There
is
little
doubt
deflation
credit
bearing
restraint in
credit policies are applied with
sufficient vigor they can crack al¬
most any
boom. However, past
scarce
the
on
politically-minded
our
\
of
course
are
will
be
called
the
Russia
our
attitude and
Hence,
the
do not know
we
current
spiraling prices is
phenomenon which
relief
from
temporary
a
will
be
suc¬
ceeded by a reappearance of infla¬
tionary
with the antici¬
pressures
is
ures
*
inevitable
of such stern
economic
an
meas¬
reaction
which brings about deflation, de¬
pression, business failures and un¬
employment. This is strong medi¬
indeed, and there are many
who question whether the cure is
cine
not
bad
as
the
as
malady. Severely
policies
are
doubly questionable in a defense
restrictive
credit
economy, where
attain maximum
a
the
is
goal
to
production with
minimum of economic disloca¬
of
the
permit the support
defense
without
program
too much interference with the ci¬
vilian economy.
Should
inflationary
symptoms
continue to subside, the monetary
authorities may be expected to
refrain from any further tighten¬
ing of credit controls.
If
have
we
another international crisis of
enhanced, while the place of
without the sobering ac¬
companiment of a critical inter¬
pressures
will reveal whether the monetary
authorities would then be able to
continue their postwar program in
the direction of
of
use
sons
a
general
there
are
more
aggressive
credit
many
why credit control
policies.
good
.
.
was
glad to get rid
oh, yes—the market.
.
Dow Industrials
got to
That
means
a
new
265.21.
is
beginning to look a
top-heavy right about
noW.;;':;v';y
it's
and the chatter of customers
measures
should be used when inflationary
lective
efficacy in coping with
of
deep-seated inflationary boom.
it
air-conditioning leaves
me
disinterested.
lot
are
of
would
be
col¬
prob¬
a
There's
a
talk about how
high they
going. There are all kinds
more
enthusiastic
desk.
my
refunding operations, the prospect
talk
I
forecasts
just can't get
interest.
cooler
on
But despite all the
A
up
any
couple of days of
weather
I
and
will
probably look at things with
a different
eye. Right now, I
am
going out and see if I can
make my irons behave.
lems and
newal
of
rea¬
or
serious
chicken
Only the future coming in to try out the new
national situation.
their individual
more
the green was all
burnt up. The ball I was
play¬
ing must have been an egg the
Maybe it's the heat. 'Maybe
something else. But what¬
posed by a reappearance of the ever it
is, my enthusiasm for
chronic and persistent inflationary
the Trans-Lux, the broad tape
The most difficult problems for
the monetary authorities would be
on
might create
Anyway
little
tations
the
in four.
on
ket
expec¬
serve
the fourth
on
the monetary authorities; the role
pressures, resort
would in all probability be had to
comprehensive economic controls
reappear,
protracted and indefinite rise
that tree hadn't been there in
of direct economic controls would
consequent revival of viru¬
inflationary
pin exaggerated
a
some sort and
sitting
edge of a pool with my
feet dangling in the water.
Golf! Who cares about
golf—
an old man's
game. Besides if
the
rather than to a general credit
policy of drastic proportions. This
might well ease the problems of
a
pressures
Treasury's
drink of
on
high. The rails got to 82.60 on
the same day the industrials
made their high^ That should
mean
something, but for the
life of me, I can't figure out
what and even if I did, it prob¬
ably wouldn't mean anything.
As a matter of fact, the mar¬
ma¬
jor proportions, a further big ex¬
pansion in our military program,
unwise to
has not complicated the
sitting here without a
in perspira¬
tion, wishing for a tall cool
drenched
<
hole, I'd have been
is sufficient to
golf
more
am
productive capacity of the country
„
Even a credit policy involving
merely moderate rate increases, if
continued, is likely to meet in¬
creasing opposition. Although the
recent adjustment of interest rates
I
that second shot
While
tion.
some
pated growth in the defense pro¬
gram, or whether the tremendous
credit policy would be reduced.
almost
an
and
scores,
scores.
,
strated
that
the buzz of customers discus¬
control, taxes
spending; the pol¬ shirt,
icy of the Administration on
prices, wages and a host of other
whether
through;
of
price
and government
matters.
the
room
drone of voices-comes
program; the future action of
on
click-clacking
another
specu¬
action
public to Russian moves;
the size and character of our mili¬
Congress
In
away.
on.
room
face,
the
tary
going
sing their golf scores, the
market, their golf scores, the
Admin i. st ration, the
golf
future; the reaction
in the
of
to
upon
largely in the realm of
lation:
market
a
hear it in the next
can
with the ticker
economy, and hence the problems
which the Federal Reserve author¬
ities
There's
I
the future
By WALTER WHYTE=
=
credit
of
use
Whyte
Says —
credit;
impor¬
an
be
consequence
Walter
readily
The salient factors that will de¬
termine
and
if
to
and
Conclusions
lent
that
resentment
economy.
the
general credit policy would very
likely meet formidable obstacles.
Markets
business, it is
these predilections have
with
that
progressively tighter
a
to
political
experience has repeatedly demon¬
general credit policy
higher interest rates.
However, the recent change in
credit policy has not been a radi¬
cal one; the present phase of Fed¬
being at least, of a
projects, and a similar
may
apparent that
change
the
government
involving
time
number of
is thus
term
-
restrictive
ably resulted in the postponement,
the
long
Reserve
the other hand,
an
eco¬
past
pursuit of
years of
Federal Reserve
than
be
all
of
been visibly affected by the
higher levels of interest rates. The
not
for
the
many
of some
of the shorter term issues. But it
outlays likewise have
spending
our
of general credit
powers
should
was
a
their
restraint
sanctvty of
business
in
conditions, they would very
likely attempt to make greater use
ress
months.
of
real place
feel
such
the
ered. Between 1948 and 1951 prog¬
was made in
eliminating the
lower consumer spending and
higher personal savings in recent
is
is
authorities
nomic system for the use of
gen¬
eral credit policy; confronted with
1947,
the time support
probably
the main factors responsible
Business
a
of
inflationary pres¬
developments of the
untoward results, embarked upon
an aggressive
support program at
to
for
:
the
was not then
willing to see
prices drop even as low as
parr and,
in order to safeguard
against the development of any
news, the
buying, and a
of
of
experiences
economy
resurgence
bond
war
scare
adoption
Federal Reserve Sys¬
become apparent only
serve
it may have
helped to prevent the increase that
might otherwise have occurred.
subsidence of
the
December,
outstanding,
The change in the
since
price support policy during World
War II.
While support prices on
long-term bonds were reduced in
has
W
In
part of 1947, the support
long-term government bonds
a
problem for the first
time
consumer
Regulation
Sentiment
became
prob¬
was
of
sig¬
step.
a
that
Tomorrow's
would become
equally vehement.
Apparently the public prefers in¬
avail¬
are
sufficiently attractive
changed
with the passage of time, however,
and in 1947 both the Treasury bill
such
in
available
government securi¬
Policy—
Consequently, the true signifi¬
cance of the
unpegging of govern¬
ment bond prices and the
resulting
tending to tighten lending and to
curb credit expansion.
Consumer
specific regulation of the monetary
authorities in turning down a loan.
But should general credit
policies
be so
drastically applied as to re¬
duce substantially the amount of
A
turns.
The Outlook for Credit Policy
off of
a good
icy—Consequently, it must be
when
unpegged.
able
Viewed in perspective, the un¬
uncertainty regarding bus¬ pegging of government bond prices
deal of
keenly
very
were
interest
consumer
psychology, to a leveling
commodity prices, and to
ber
many
lighten
their government portfolios with¬
rates
and
government
security out loss
by allowing their matur¬
prices
have
widespread
effects
ing obligations to run off. "Also,
throughout the economy. In con¬
portfolios managers, directors and
trast to direct or selective controls,
trustees will eventually lose their
general credit restraints cannot be aversion to
taking a capital loss
avoided or evaded; there is no
on the sale of
products.. The imposition of price general
controls
are
advantages in the
general credit policy.
It
enjoys great flexibility; it can be
applied rapidly, and without the
drafting of complex regulations,
of
use
further aggressive action, contrib¬
a
there
administrative
progress in Korea, -coupled
witn the failure of Russia to take
uted, to
Furthermore,
the mili¬
Also,
tary
29
effectiveness
and
assisted
the
economy
ened
the
other
which
inflation.
have
Such
cies contribute to
a
forces
damp¬
credit
more
in
poli¬
careful
and cautious appraisal of the eco¬
nomic outlook, and thereby facili¬
tate
the
task
of
dealing with
inflationary pressures.
Conse¬
quently, although credit policies
may have only marginal effects
in
helping to shape the course of
economic
events,
this does not
mean
that
negligible.
omy,
ate
a
In
a
contribution
free market
most economic forces
through
sions, and
of
their
is
well
greatly
restrictions
be
of the
by the
novel situation. It may
that the salutary results
a
change in Federal Reserve
policy
based
are
upon
a
unique
constellation of circumstances not
likely to be repeated. For years,
many
financial institutions had
important barrier to
the development even of moder¬
ately effective credit restraint is
provided
by political opposition.
past decade of full employ¬
The
has
ment
willingness
fect
ness
lective
would continue without
signficant
reduced
public
credit
controls,
similar
oper¬
stantially assured for an indefinite
period ahead. As a result, they had
effect
adequately covered their
sub¬
securities, and thus felt the
sure
of
Con¬
power
move
is
in
modify the controls
financing.
credit, and
General
progress
on
a
to
pres¬
declining security prices
credit
restraint
vulnerable
cause
are
•
U.
CALL
of
perhaps less
OPTIONS
Per 100 Shares Plus Tax
Phillips Petr..@48%
Amer. Woolen @40
Sperry
.@29%
U.S. & For.Sec.@50»/2
111. Central...@61
Schenley
..@33%
Pure Oil
@56
Oct.
6
5
lenders
cannot
point
to
a
Securities
300.00
Nov.
250.00
Jan. 29
400.00
Oct.
Orders
437.50
Nov. 17
Executed
on
237.50
5
Jan. 22
Pacific Coast Exchanges
325.00
Sep. 28
Mission
@27% Oct. 8
Chrysler .....@70% Nov. 13
United Aircraft@29% Dec. 24
225.00
..
Penn RR...
West.
275.00
387.50
@19% Dec. 21 187.50
Maryl'nd@21
Oct. 29 250.00
.
.
Subject to prior
sale
or
Explanatory pamphlet
price change
on
request
THOMAS, HAAB & BOTTS
Members Put & Calls Brokers & Dealers
50
Schwabather & Co.
"
.
287.59
Association, Inc.
politically, partly be¬
Pacific Coast
•
S.
Steel... @41% Oct. 13 $237.50
So. Pacific .,.@64
Nov. 16 362.50
real estate
measures
com¬
mitments by cash and short-term
SPECIAL
.....
ac¬
of the Federal Reserve authorities
government
was
the
recently limited the
econ¬
securities
the
to
employment and busi¬
activity. In the case of se¬
gress
policies
the
upon
been operating on the general as¬
support
of
cept any credit policy that might
have a measurably restrictive ef¬
sumption
that
probably
change and that the liquidity of
large number of marginal de¬
cisions may be impressive.
has been
exercising
lending institutions
upon
shock of
not
cumulative
in
policies.
Another
to restrict consumer
these marginal deci¬
the
policy
aided
such
might well prompt a re¬
of Treasury resistance to
Broadway, N. Y. 4, Tel. BO 9-8470
Members
New
New
York
Stock
York
Curb
Exchange
San
Francisco
Exchange
Stock
Chicago Board, of
14 Wall Street
COrtlandt
7-4J 50
Private Wires to
San
(Associate)
Exchange
Trade
New York 5, N. Y.
Teletype NY 1-923
Principal Offices
Francisco—Santa
Barbara
Monterey—Oakland—Sacramento
Fresno—Santa Rosa
30
*"
(622)
Continued J
from
.. .
Thursday, August 16, 1951
citated in September 1950. Control day-to-day needs of the country; terms of years up to about ten.
This request was withdrawn early
12
vaae
^ y
The Commercial and Financial Chronicle
"
exchange margins, origi- and to augment working capital
nating in the Securities Exchange where made necessary by higher
of stock
Act of
Developments in Selective
ular
1934, has been kept in reg-
wages
and prices
of materials in
operation, although the mar- essential industries. Further, apbeen varied according proval was given to loans to deal-
gins have
to circumstances.
Credit Control
an
addition
In October 1950
made to existing
was
ers
securities
in
conduct
of
their
in
the
normal
business
or
as
in 1949 in view of altered circumstances. Next came a step which;;
though concerned with regulation
of the use of credit, had a firm
and specific statutory basis. Wartime legislation had imposed re-
the intro- required in connection with the strictions on consumer - credit
on residen- provision of capital for any of the which lapsed in 1947; but by Act
to make
recommendations on tial real estate construction cred- foregoing purposes. On the other of Parliament these were revived
credit policy and to prepare bank- its.
'v..•
r
'
v7/;^
hand, loans should not be made towards the end of last year and
controls by
of National Economy as president, duction of restrictions
statutory
confidential
relationship
between
the
Reserve
bank
and
Bank
does not ask that the name
customer,
of any applicant
for
Finance
'stock
in
shall be divulged,
materials
raw
trade
current
for
and
working expenses
does not come
within the scope of control
at
as
and
policy
present defined. Broadly, it
restricts advances for speculative
investment
purely
or
ranital
purposes,
exnenditure
reoavment
of
mortgages, hire purchase and
other credit sales "luxury" spending and building or purchase or
refinancing of dwellings except
for
short
periods pending
the
raising of finance from non-banking sources. Banks are asked to
refrain from making any advances
for speculative purposes S but adlisted
made
case
the
For
Bank.
ex-
ample, under the heading of capexpenditure the procedure is
ital
to consider first whether the pur-
for which the accommodation
required is necessary to promote or maintain useful producpose
is
tion
services, ' and
secondly
whether it is reasonably practicable to obtain the needed finance
or
from non-banking sources, having
Regard
conditions
local
and
the
individual applicant. The Reserve
to
circumstances affecting
other
purpose
of retiring
or ac-
Control
set
Commission,
up
1941» which
entrusted with appeal was made to banks to exfunctions of enforcement.
ercise "extreme caution" in their
In January
1947 instructions lending policies. It was pointed
were
issued that banks, when out that the volume of bank credit
granting new credits, should ver- had been greatly enlarged during
ify the economic justification of the war; that domestic and foreign
the credit, making sure, in par- demands for goods and services
ticular, that it was not being used were exerting a strong upward
to finance unduly large accumu- pressure on prices, and that these
lations of stocks of commodities,
banks were also required to
The
committee. Thus lending institutions have been asked to refrain
from
financing
inventory
increases above normal levels relatjVe to sales, or "reasonable requirements by other conservative
yardsticks," and have been asked
to encourage the reduction of exCess inventories.
Loans for the
demands in themselves would be following purposes "might be
inflationary without any further postponed to a more propitious
increase in the use of bank credit, time":-—construction of facilities
The banks were asked to curtail to improve the competitive posiloans for speculation in real es- tion of an individual producer of
tate, commodities or securities, to non-essential goods; expansion
guard against over-extension of and modernization of undertak-
in the ordinary course to the
Bank of France. Permission has
to be obtained from the Bank of
France prior to the granting of consumer
credit exceeding a given
amount—orginally 30 million
francs, but subsequently varied
and now standing at 100 million
francs. The banks were also instructed to examine existing
credits and to make all possible
reductions where this could be
done without impairing industrial
any
output. In this re-examination, as
credit, and not to relax
the terms of hire-purchase financing. Bank credit "should be confined to financing that will help
production rather than merely in-
ings in distribution or service not
directly supporting the defense
program; expansion and modernization of plant for the manufac-
ture of consumer goods not recrease consumer demand."
lated to the defense effort.
In
In January 1948 the American addition, guidance has been given
Bankers Association announced a on the financing of state and local
voluntary anti-inflation pro- government projects.
four items, to be carThe system thus outlined is in
ried out by commercial banks a formative stage and it is too
throughout the country. First, in early
to
judge 'the
results
the - months immediately ahead, achieved,
especially
since
the
banks should avoid giving com- course of events has been strongly
modity and inventory loans de- colored
by other developments
gramme, of
statement on credit in granting new credits, the banks
said that "neither were required to discriminate in
hard and fast rigidity nor 'rule of favour of those which were calthumb' methods govern the gen- culated to promote healthy busieral administration of the policy." ness expansion. Towards the end signed to finance the holding back within the realm of
monetary polof 1947 the principles of discrim- of essential goods from the market
iCy including a trend towards a
Sweden and France
ination were more closely defined: in anticipation of price rises. Next,
tightening of the credit basis and
in
Bank,
a
has
control,
-
In
Sweden
ihrmcrh
He
t
selective credit
too
intrnHnofinn
Wwith
y
measures
nnitp
th
w
in
infioti/naw
^ur.1r
^
minimum
Tash
ments
the
on
effort
an
required
banks
bank
and
the
Riks-
commercial
banks
with regard to credit policy. The
banks agreed to exercise restraint
in
their
lending
activities; but
be given to
essential home-
preference was
exporting
and
market
was
to
industries,
while
credit
to be made available for the
needs
of
building operations approved under the official permits
system. On the other hand, the
undertook
offered
for
refuse
to
^
liquidating
"J,
fn
y recourse to
surplus
assets,
or
loans.
prior
chase
securities or property
During 1949 the
Prohibited.
the monetary system
During 1948 selective controls
were strengthened and new
quantitative controls introduced,
Subsequently both selective and
quantitative controls have been
varied in detail to meet changing
economic conditions. Thus theselective controls were made particularly severe in 1949 with the
The
banks
consultation
with
laxed.
Across the Atlantic, the system
of selective credit control is the
orderly market. The
commercial
banks.
organizations, to
operations. To some
these methods have been
extent
applied
secure
a
system
for
which
the
During the war years, selective
control of credit was limited to
introduced control over other statutory regulation of instalment
banking institutions. At the same credit and stock exchange mara
restraint is not
a
country with
commercial
of
easv
to ooerate
more
bankc
Ob-
cn-nnerative
than
in
14 000
miifp
nnnrt
commercial
Danks quite apart
all the other lending institu-
the
*£
rectness of
a
proposed borrowing
consult
its
regional
com-
doing so^L
or
a
sen-
•
Canada
the
fined goods. Again resorting to/
informal arrangementSj in February, last, the banks undertook to?
exercise restraint in their lending
policies, as a means of counteract-*
mg inflationary pressure, by ob-
serving a set of broad principles;
N° further "capital" loans—that
Is to say loans for a term of more
than one y ear-were to be
granted; limits were placed.on the.
financing of transactions in new;
corporate securities; and no further credit was to be extended for
hire purchase, while margins for
existing instalment finance loans
were to be increased. In addition,?
applications for advances for or-'
dinary business purposes—espe-;
cially where additional amounts
were involved, as for example to
finance enlargement of stocks—
would be subjected to careful
scrutiny, the general objective be-'
ing to hold the total for advances
at about the level then existing
apd, in particular, to avoid the
financing of any transactions of
a speculative nature. Here again
is to° early to jud£e the results
of the arrangement, especially as
other measures of monetary restraint have been at work; but on
the wherfe it is thought that the
general effect has been to hold m
cbeck the financing of unduly exPanded inventories and capital extensions.
One
,
Sten
in
Reverse
Reverse
Lest ^ should be thought that
the tr®nd is ab in the dir®cti°n °*
'
selective credit controls, it should
.
.
..
.
.
' PnnfHHAc
noted that in many- countries
methods appear to have
n0 sucb
heen adopted. Indeed, recent records of the development of mone-
tary policy: seem to give greater
emPbaslf to the former mstru-
ments of Quantitative control and
.further, of one
intefst
country at least it can be recorde(J
*^at. .self.SfandnhS
Tt
hfrt httn
Proval
before they could be
imnose
Qualitative
controls
Re¬
Across the border, in Canada, " .
.
'
the structural background for extnereiore, tne course oi
periments is different in that the events in a wide range of counbanking system comprises a rela- tries, the issue of priority as be-,
tively small number of commer- tween old and new methods of
cial banks, most of them with
H
,
.
,
widespread branch organizations,
f
8 auon cannox yet oe
so that informal association with said to have been settled,
the central bank in the pursuit of
a concerted credit policy is prima
Edfferton Wvkoff Adds ■
.
facie easier to secure. On the other ;
^nd, in contrast to conditions in
the United Kingdom, there is no
(S5.lal
taq
to
T'm FlJNCUL
ANrFTFS
Chronicle)
r^nia*
ralif
LDS ANGELES, Calif.—Cecilia
basis of control of new capital isBieb has been add ed to the
sues upon which selective credit |.a0
®dSedon> .Woff & Co.,
control can be built. The first in- 618 South Spring Street, members
formal understanding was entered °£ tbe L°s Angeles Stock Exinto early in 1948, when the Bank change.
.
' . .
.
supplying
of instalment payments for de-
vide for the retention of power to
•
direct or iudi- of Canada asked the commercial
the Minister expire, but was once more resus- services
few months ago. They;
tence from a report by the Na- granted- As Part ot me general
tional City Bank of New York, return towards a freer market
issued at the beginning of June, economy, these arrangements were
"people connected with the pro- ?n 8en<rraI superseded, as from the
gram" were already "impressed by beginning of this year, by^an elODthe widespread response it was °rate system of quantitative congenerating among lending insti- trol,- though an enabling bill now
tutions of all kinds."
under consideration would pro-
pow,er .and banks to curtail the provision of
he production, credit for capital expenditure, esL_
rly d]^stribu- pecially by way of new term
National Credit Council gins. Control of instalment credit
8
a
other loans —that is to say, loans of
up, with either the Min- has twice since been allowed to S*aPle products, and of goods and fixed, but sometimes regularly di-
aster of Finance
a
cision whether the- borrowing is pracucauy aoanaonea. ii naa oeen
to take place or not remains with
"Jf w S!ii
the institution itself. In order to arrangements py wmcn an appntest the efficacy of the arrange- catl?ns lor ban* f edlt feeding
ment, special statistics are being a -liven+ a™ount had totbe sut)J
collected and examined by the mitted to-the central bank tor ap-
way
had been more clearly opened by
provisions in the Defense Production Act 1950. The Committee,
appointed by the Federal Reserve
Board, consists of representatives
oi commercial banks, insurance
companies, investment houses,
mutual savings banks and savings
and loan associations. SubseQuently, regional committees were
up to "offer opinions and advice to lenders as to the desir-
ization of the Bank of France and
the four largest deposit banks also
set
of interest rates.
svstem
generally committees, and, to quote
informality to the broad purposes of credit
control, but the latest experiments ablUty of specific loans.
In a
example of a comprehensive are closer to the informal, costatement of principles the genstructure of bank credit control
operative arrangements between eral policy was set out, and to this
on a statutory basis
is provided monetary authorities and com- statement all lending institutions
by the system operating in France mercial banks that have been were asked to conform. The folThe law of
December 2
1945 developed in countries less wed- l9wln*» tyPes
loans were classiwhich provided for the national- ded. to the legislative method.
fied as "proper";—loans for deIn contrast with the
time
a
mittee In
under no
in obligation to disclosb the borrowrelaxed, er's identity, and the* ultimate de-
observed restraint on the extension of credit for less desirable
purposes, such as speculation and
excessive business expansion or
building up of stocks. More decisively, in March 1951 a national
Voluntary Credit Restraint Committee was set up in furtherance
of the Swedish system, a European
was
viouslv
pressure
was
but with the outbreak of war in
Korea the case for restraint in
bank lending was powerfully reinfbfced. From July 1950 onwards
various exhortations were issued,
from official sources and banking
of
United States
visions being left to the judgment ing
the
o n
abundance, should be discouraged-
was
carrying out of the credit agree-
of
11
to customers not directly engaged tion advocated an intensified camin the Paction of goods. The paign to persuade the public to
subject of quite recent experiments. The United States is the
country
in which,
beyond all
ment between the Riksbank and others, reliance has been placed
the commercial banks appears to on detailed legislation and adbe almost entirely informal, de- ministrative fiat to regulate bankan
r u c
nrar.
the Riksbank, the object being to
maintain
t
c o n s
the owners per- Thirdly, priority should be given from
ap-
Agreed also not to take part in the
arrangement of new bond issues
without
for
essential business and could not which could be postponed until
be obtained by increased sales, supplies and labor were in greater
object of establishing healthier
conditions in specified trades and
plications for loans for speculative promoting expansion of exports,
or
non-productive purposes. In 1950> however, more especially
Stricter scrutiny than in the past towards the end of the year, the
was
to be given to the security restrictions were considerably rebanks
or
ductive Ptoses such as the pur- invest in Government bonds.
between
the
for building,
wa<^ Provision of credit for non-pro- save more and, in particular, to it will
by
into
entered
be ,gr?n'ed mortgage l°a«s lor non-essential hardening
required
££st S wS hJentoaln^f
reserve
commercial
JuppfeTented
cr?dit? might
funds were
r>n<*
fluantitativp^^Xicfion
This
where
sonal resources or to the capital to loans to finance essential sup- tions it encomDaw«s
ThP
imrJpr' ctaf" market. The banks were also told plies and services at home and tical arrangement is'that'for
npl" to reduce the facilities granted abroad. And finally, the Associa-
+™r,rie
iqciipJ
r
u/prp
te
qu
In October last year
+«
oineJ'
wsc
formal
fo m
of quantitative control.
ciated
ass
ntw
tightened
quiring corporate equities in the take the usual form of prescribing
hands of the public, nor for fi- minimum proportionate initial
nancing speculative investments payments and maximum periods
troller of the Currency, the Fed- or purchases.
- ■
eral Deposit Insurance CorporaThis hroad statement of princition and the National Association pies has been translated into more
0f Supervisors of State Banks is- detailed terms by bulletins issued
in sued a joint statement in which an from time to time by the major
keep records of requests for credit,
given and these particulars are reported
policy
on
Reserve
on
for the
of the National Credit Council
and d™* records orbank credits
are centralized in the Bank of
France. There is also a Banking
in the light of
information
by
the
are
above
merits of each
the
'purposes
other
the
for
vances
ing
regulations. The Bank of
The story of the less formal
France participates closely in the control begins in November 1947,
entire process, since the Governor when the Governors of the Fedof the Bank is also vice-chairman erai Reserve System, the Comp-
essential* minishing,
amounts
for
agreed
-
.
.
.
With Kmg Merntt
v
(Special to The Financial Chronicle)
:
LOS
ANGELES
B - Evans
with
has
Calif —Harrv
become
affiliated
King Merritt & Co
Inc
Chamber of Commerce Building!
Volume 174
Number 5038
.
.
.
The Commercial and Financial Chronicle
(623)
stock
\ Continued from
2
page
and
owned
all
by
of
the
the
B
stock
are
management
and
their families.
On
The
and
Security I Like Best
Simmons
Co.,
the
covering
pei;iod 1940 through 1950.
Of course, Simmons Co.
$42%
over
Corp.'),
may
times
be
(vs.
$18
affected
somewhat
current
in
securing
liabilities.
The
of
jnaterials for normal peacetime that 20 trusts have invested in its
but defense business will stock vs. three in Ferro.
largely offset this.
At the same
Thus, while Simmons has been
time, one should bear in mind held back marketwise over the
lines,
;
tha^
Simmons
is not
only
past
; largest; manufacturer of quality
bejis/bedding, and space-saving
year,
sail
of
ahead
for
the
Company, the business conducted
by it in Pennsylvania exempts its
shares
under
from
prop¬
numerous
proceeds
an
adequate
replacement
equipment
of
and
buildings. As
be
if
used
major
of
to
sound
should not
reserve
surplus
and
repairs
matter
a
protection this
for
reserve
furnishings
earnings
available and should be
iri government bonds
•
■
from
being
13
page
also
Factors in Sound
Self-Liquidating
College Housing Projects
the record
far
out
of
opinion
are
invested
needed.
Provision
should
be
made, under certain cir¬
cumstances, for the use of this
and pros¬
pects indicate it will likely again
our
tne
counsel
pending its
Continued
higher regard in which Simmons
is held is indicated by the fact
by difficulty
adequate supply
an
per
$1.26
in
31/2
assets
'
'
an¬
of
rate
marxei.
existing law
share, the A stock yields about the Pennsylvania
personal
6.90% at 18y4, the offered side of
Ferro
erty tax.
for
current
and
the basis of the present
dividend
nual
uie
Pennsylvania
31
legally
possible
reserve, if necessary, to meet debt
service requirements.
Where legally
possible provide
an
independent corporate trustee
for the revenue bond
issue which
will also act as
paying agent for
the principal and
interest; as cus¬
todian of the
reserves, with cer¬
tain powers of
investment;
to
pledge
the of earlier retirement. These pat-'
existing project to terns were usually chosen be¬
names, but its Simtex Mills Divi- currently on business and market help secure a loan for a new proj¬ cause
they fitted in with certain
sion produces a
I regard it as a ect, there is
line of textile considerations.
ap¬
justification for fol-. preferences of prospective investprove the adequacy of
insurance
•products including tablecloths, buy for earnings-dividend stabil¬
owing
this policy to accelerate
0Fx
were sometimes worked coverage; collect and disburse in¬
bedspreads, nightwear flannel, ity, comparative value, financial retirement of the debt. The crea¬ out ?
by negotiation with commer¬
surance in case of loss
1 mattress
for benefit
tickings and furniture strength, and as a stock of sub¬ tion of a substantial equity in cial and investment bankers who
of bondholders and
to see
; fabrics,
that
and is also the largest stantial price-gain potential vs. your residence halls will be help¬ purchased the revenue bonds.
furniture
famous
under
trade-
other
stocks
comparable
it
to
revenues
of
an
•
•
•
'
maker
of
America,
•
cotton
Financially,
;
far the
1 tory,
flannel
shirts
in
best
Simmons
condition
in b,y
is
in
with book equity
latter factor is
its
share
per
Funded debt
high
Common stock
(shares)
Avg. annual
Earnings
(1949
^
Low
Paid
High
14%
$0.91
211/2
111/2
71/4
0.68
17
11%
0.45
•
1
131/4
___
1943
—J—
—
17%
____
1944
Div.
Low
71/2
High
1941
$4.50 and $7.26
—Price Range—
Div.
'
1942
$4.31 per share
$2.12 and $4.81
251/2
151/2
34%
19%
1945
____
1948
■
—
17%
*
been
32%
1.25
57
33
41
271/2
25
2.50
11%
1.27
(to date)
I61/2
31%
Current
Yield
v :
I'.:'
1
_
10%,..
♦Plus
4'
....
18
At 311/4
. ____
_
_
22
r-
not
other
funds
to
bond
is¬
revenue
30 years although
over
cases revenue
issued
over
bonds have
longer period.
a
+1 +S the longer the to remember
*j3S0 imP°rtant
that
maturity the
higher the interest rate.
*1.36
35
241/2
fl.60
35
291/4
At 31_
(i•5.1%)
—-
3.00
In
addition
>*
;
SCHUYLER
!
•' vY'v- Y/'; 'iV'-V Y
•.
V.
'
Term
to
should
a
rial
to
the
length
between
and term maturities is
important.
turities
fixed
a
In
be
of
se¬
some¬
serial
ma¬
amount of
princi¬
pal is due each year and must be
made
callable
within
reasonable time after the antici¬
pated
This
mit
completion
the
of
project.
desirable not only to per¬
the acceleration of debt re¬
is
tirement
out
of
other terms of the trust
indenture
complied with. Such a trustee
are
be of
can
other assistance
operating
officials
and
but
also
to
to
the
investors
generally recognize that it pro¬
vides added security to a loan. *
The
borrowing
should
agree
institution
to
adopt, if neces¬
sary, reasonable rules,
regulations,
and requirements relative
surplus earnings
residence
of
students
other available funds
the college to
the
to
attending
assure
that the resi¬
permit the refunding of out¬
dence halls, the revenues of which
standing bonds under certain cir¬ are
pledged as security for a loan,
cumstances.
The latter may in¬
will be as
fully occupied as is rea¬
clude an opportunity to reduce
sonably possible.
interest costs through a new issue
It is my firm conclusion
at a lower rate; to consolidate the
that a
security with
constructed,
turities
make
the terms
deemed
new project to be
to extend the ma¬
a
or
and
other
of the
advisable
of
credit
v
VECHTEN
VAN
Serial and
the choice
maturity
times
>»••'. •V', ■'
Between
Maturities
3.00
(9.6%)
maturity schedule is the right
call the revenue bonds
prior
maturity. All revenue bonds
to
in
Choice
2.50
changes
original loan
to
protect the
institution.
Care
the
residence
halls
project, set
conditions
up
self-liquidation
under
which
sideration
the
into
various
which
I
sound
investment
have
terms
take
factors
referred
to,
for
and
con¬
is
your
a
col¬
lege or university and, at the same
should
be taken
in setting
the
call provisions to avoid unneces¬ time, is a sound investment for
the individual investor or
sarily jeopardizing the market¬
lending
ability of the loan
the financing costs.
necessary
or
It
desirable
or
increasing
is usually
to
institution.
With Richard J. Buck
agree
premium for. the privi¬
(Special to The Financial Chronicle)
lege of calling the bonds before
BOSTON, Mass. — Owen Grant
maturity, with the revenue bonds
maturity, perhaps on a sliding has become associated with Rich¬
Hudson Pulp & Paper Corp, Class A Common Stock
to be retired through
sinking fund scale
downward, predicated on ard J. Buck & Co., 8
and/or call, only the interest has
Newbury
The Class A Common Stock of $15,000,000 annually to sales vol¬
the number of years the bonds Street.
He was
to
be
previously with
paid regularly and more
the Hudson Pulp & Paper Corp. ume and increase earnings by at
have been outstanding. A larger Gordon B.
Hanlon & Co.
latitude is given in case of "off"
offers the investor a liberal re¬ least
$1.00 to $1.25 per share,
premium is usually stipulated to
years, when earnings do not meas¬
turn and possibilities for sub¬ based
on
the
present tax law,
call bonds for its purpose of re¬
ure up to expectations.
Long term
Draper, Sears Adds
stantial
longThus, common share earnings in
bonds are subject to the objection funding than to retire them out
(Special to The Financial Chronicle)
term
the relatively near future could
capital
of
earnings •: but
the
premium
of a higher interest rate,
limiting
;
be at a rate in excess of $4.00 an¬
appreciation.
BOSTON, Mass. — William B.
the marketability to a certain type should not be made so large as
Betts has become affiliated with
The Company,
nually.
to take away
the advantage of
of investor and
usually requiring
which
is
the
Draper, Sears & Co., 53 State St
It is &n important producer of
1
the payment of a premium for re¬ refunding.
Vice-President, Lee, Higginson Corporation, New York City
I
>
271/2
vindicated.
*" •• *
1
building costs and the
2.50
36
a
This is usually considered
permit.
1.25
231/2
1951
to
161/4
1.18
by placing
or
the older security.
riod as the investment market will
24%
*1.27
finance
exists, the maturity may have
be extended for as long a pe¬
some
181/2
1949
: '1950
sue
in
15%
also
Another feature that fits in with
the
or
1.00
I6V4
-
on
inadequacy
of
supplement the
be
211/4
-1
lien
to
2.00
will
project
new
1.25
/
that
issue
12
241/4
1947
: 1948
new
46%
0.91
are
this financing can be
refunding the partially
outstanding bonds with a
$2.00
'
'
of
There
by
351/2
0.91
34
Paid
financing
when
done
28
0.91
future
Where high
$120'
—Price Range—
times
second
1,158,236
$2.37 per share
1950)
the
in
the
$6,900,000
$72
and
ful
other needed facilities.
retired
459,296
—
,v:cyy V*
....
so
125,000—4 %.%
1941-50
earns.
time
level.
a
—
1 Sales per share, 1950
*
This
a
Corp. (FOE)—vs, —SIMMONS CO.(SIM)—
$5,000,000 (loan)
] Preferred stock (shares)
"
.
important at
when the general market is at
hi&-
—Ferro
.
slight risk of decline.
very
v
earned
that
year/' With
term
a
tQrPay
^
4
.
..
,
outgrowth
a
of
members
both kraft and tissue which rank
business
tirement
maturities
originally
the most rapidly growing
segments of the paper industry.
established
in
It
1896, is
of
ducers and best merchandisers in
a
the
paper
are
growing enter¬
sold
as
prises
into
gummed sealing tape, paper
the
one
among
fastest
in
the
indus¬
paper
Since
August,
1945,
Schuyler Van Vechten
its total assets
hoyp
$4,700,000 to about $35,000,-
000,
its
and
$7,700,000
to
a
in
in
excess
as
its
of
of
reported
Commerce
rose
fiscal
1946
from
year
of
well
rate
$30,000,000. Between
1946
31,
sales
sales
annual
current
Dec.
the
net
and
all
Dec. 31, 1950,
companies
paper
by the Department of
increased
while
52%,
those of the Hudson Pulp & Paper
Corp. between Aug. 31, 1946 and
Aug.
31,
1950
increased
195%.
Earnings,
marked-
expected
are
per
have exhibited a
degree of growth, and
too,
to
approximate
share in the fiscal
31,
Aug.
year
$3
to end
1951.
of the lowest
one
industry.
cost. pro¬
kraft
Its
is
such and is also converted
shipping
which
maturity.
Serial
usually include
short term bonds command
mtei est
er
wider
rate,
group
are
of
a
investors
always retired without
mium
unless
low¬
of interest to
called
before
a
and
pre¬
their
due date.
other
Revenue bonds to finance selfend products, while its tissue is
liquidating projects are frequently
con verted into towels, napkins and
used with a combination of serial
toilet tissue. Hudson is the largest
and term maturities, which give
manufacturer of kraft gummed
L.lsifue some
the advantages
sealing tape and supplies about
40% of all the paper napkins sold °l Pi?
types. The simplest form
for household consumption. The °i
combined type is an issue
of, straight serial bonds with a
Company sells the bulk of its substantial
amount due on the last
products in the area East of the
maturity customarily called the
Mississippi and, up to the present
balloon.
This permits a reduc¬
time, has made no attempt to tion in the fixed amounts due
develop the large Western mar¬ each year except the
last, with ex¬
kets.
cess earnings over and above the
The Company has outstanding annual fixed
requirements used
500,000 shares of Class A Common to retire the last maturity by call.
Stock and 500,000 shares of Class Here in
Michigan we have used,
B Common Stock which are alike on a number of
occasions, a com¬
in all respects except that, prior bination of serial and two dif¬
to Jan. 1, 1958, the directors have ferent term maturities, the latter
the option of paying cash divi¬ identified as Series "A" and Se¬
bags,
try.
from
is
before
sacks,
and
*
dends
the A stock
on
in
amounts
ries
"B."
The
Series
"A"
Bonds
The
Company is currenty en¬ greater than on the B stock, or would be due perhaps in 10 years
gaged in doubling the capacity of exclusively on the A stock in an and the Series "B" Bonds in 20
its
Palatka, Florida, kraft mill aggregate amount not to exceed years. The term bonds were is¬
through the addition of another by more than $1.50 per share the
paper machine which should be in amount,
if any, paid on the B
production by early fall. It was stock. Since the directors have no
recently announced that the Com¬ present intention of paying any
pany
has been granted
cate
of
Necessity,
$9,000,000
a
Certifi¬
covering
expansion,
this
dividends
on
payments
are
which
will
enable it to amortize for tax
pur¬
plowed
over
thereby
poses
a
60%
period
portant
of
this
of five
step
program
years.
should
This
add
im¬
about
the
for
bulk
both
passu.
of
back
the B stock, dividend
relatively light and
earnings
into
building
classes
About
the
up
of
one-half
being
are
properties,
the
equity
stock
of
pari
the
A
sued in such amounts that the
es¬
timated surplus earnings over and
above the interest and the serial
bond
requirements
would
retire
the series "A" bonds within eight
and the Series "B" bonds in
years
9
to
17 years.
not measure
If the earnings do
up to estimates there
margin of safety of two to
The term bonds would
command a higher price than the
corresponding maturity of serial
is
a
three years.
bonds
because
of
the
possibility
?j\.set.^n£. UP the terms of
self-liquidating loan
a
of
Boston Stock
should
care
the
New
York
an
1
Exchanges.
be taken to
provide as many safe¬
Witjh Salomon Bros, Hutzl
guards as possible to insure the
(Special to The Financial Chronicle)
prompt payment of principal and
BOSTON, Mass.—Russell Whit'"
interest, but not to include con¬
ditions that might become unduly Jr. has become connected 'wi :
burdensome to the borrower.. A Salomon Bros. & Hutzler, 75 Fed ¬
.
default would not only do serious
eral
Street.
harm to the credit of the institu¬
with
Harris, Upham & Co.
He
previous y.
was
tion and impair its ability to ob¬
loans
tain
the
in
Townsend, Dabney Adds
but
future,
would
probably reflect unfavor¬
ably on the general reputation of
the
The
college.
following
are
(Special to The Financial
Chronicle)
BOSTON, Mass.—Henry B. Fen
ton is
now
-
affiliated with Towns-
of the
safeguards that may end, Dabney & Tyson, 30 State
help to prevent difficulties
in Street, members of the New York
meeting obligations.
and Boston Stock Exchanges.
some
All net
revenues
of the
project
should be pledged for the security
of the loan and not just enough
meet the
to
acceleration
ment
during periods of good earn¬
will reduce the fixed re¬
of
quirements when
so good.
debt
retire¬
earnings
may
not be
Capitalize
of the
vice
out
revenue
of the
bonds
a
proceeds
debt
ser¬
Clark
be
be
used
it should
Street.
He
formerly
was
with Harris, Hall &
Co.
V. B. Allison Joins
Du
equal to at least one
year's average principal and in¬
terest requirements. If any of the
should
'
CHICAGO, 111.—James W. Ewing has become connected wit
Kidder, Peabody & Co., 33 South
reserve
reserve
Kidder, Peabody
(Special to The Financial Chronicle)
regular debt service.
The
ings
Joins
Pont, Homsey Co.
(Special to The Financial Chronicle)
-
SPRINGFIELD, Mass.—V. BlakAllison
has
become
associate."
replaced out of the first avail¬
with du Pont, Homsey & Co., 9
after meeting future State Street.
Mr.
Allison
wr
requirements and
before
previously with Walston, Hoffmr
able earnings
fixed
further
acceleration
of
debt
re¬
&
even¬
tirement. This reserve can
&
Goodwin
and
F.
L.
Putna:.
Co.
be used to retire the last
revenue
bonds outstanding
and,
tually
until
required,
provision
reserve
fund
in
Joins Waddell & Reed
should
be made for the investment of
(Special to The Financial Chronicle)
this
PEORIA, 111.—Helen R.
government
ter
bonds.
Capitalize out of revenue
bond
of
is with Waddell
Kansas
City.
&
KallisReed, Inc.
The Commercial and Financial Chronicle
S2
^
Thursday, August 16, 1951
.
.
of 25% an¬
nually— is unanimously devoted
building up a future im¬
agricultural
Those getting in now on
equity basis have the oppor¬
.
tunity to share in the growth that
eventually come through. Or
outcome might conceivably,
"the
as
for, be another Swit¬
is hoped
Meanwhile, the extreme short¬
profitability
assures
age-economy
•-nat least in domestic currency.
irrespective of its
ideological
predilections,
has been energetically devoting
itself to facilitating such invest¬
The
regime,
inner
ment
the
pre-
availability
of
of
common
of
successful
.
hundreds
corporations
yielding
the most sensible American
foreign capitalist from 6 to 8%, with net working
would be to come in on the real¬ capital in excess of market price,
istic investment rate of $1 to the with read;/ salability on the New
pound, on the chance that de¬ York Stock Exchange, radically
Meanwhile,
for
course
the
.
But,
facts in the
.
.
recognizing its im¬
inflow,
at
easy
stocks
acquired
,
1
zerland.
asset
devalued rate.
back in the Mandate days.
fected
,
power.
may
the
in the
irrespective of the true
valuation at that rate can be held impairs the zest for sending capi¬
situation, it is evident
and will lead to subsequent full tal way
over
here to the Midthat in practice the fear of the
convertibility and the privilege of East, to be semi-frozen and at¬
ten off at 25% per year; there is
regime leaders' predilection for
tended
by
so
many
attending
exemption from property taxes; "socialism" as their basic ideology, taking home his money.
complexities and imponderables.
and in some cases there is com¬ will remain a deterrent to Amer¬
Bond Buyers' Status
Of course, there are foreign in¬
pensation to offset taxes paid at ican investors.
The American subscribers to the vestors of capital whose motiva¬
home.
'.
lie
outside -such
"hardnational bond issue receive their tions
External Threats
The Investment Center is help¬
interest and principal in dollars; boiled" considerations: such as in¬
ful in lending its good offices for
An even greater threat, inclined
concerns
"defensively"
but at a rate of return (3
%) dustrial
the securing of a local partner, to
be
weighted
insufficiently wholly incommensurate with the and competitively seeking a stake
which in some cases may be an when one is concerned over eco¬
enterpreneurial nature of the in¬ in the nation's future develop¬
investment trust.
"
nomic details here, is presented vestment.
If, in the face of the ment, and individuals prompted in
There are six of such invest¬ by the truly dangerous interna¬
many surrounding risks and im¬ whole or in part by sentimental
This arises not
ment companies of a major char¬ tional situation.
(the latter high¬
ponderables, money is still put in, considerations
acter, functioning along the lines only from the possibility of a gen¬ it at least is entitled to the return lighted by the fact that Israel's
eral
world
of British tradition, namely:
war,
but more im¬
appropriate to an equity rather bond sales to American individ¬
mediately
from
Israel's tinder- than to a riskless fixed-interest uals have already exceeded their
Palestine Economic Corp.
box situation vis-a-vis the neigh¬
obligation.
$50 million total of foreign in¬
African
Palestine
Investment
boring Arabic States. The genu¬
;::«6s;
vestments in all countries during
Co.
(with
subscriptions
from ine fear over future
aggression
Competition at Home
1950).
But
these sources are
South Africans).
'
toward
Tan
changes
explains the
absence of any nationalization be¬
yond that of the railroads, ports,
and communications which was ef¬
investment in Israel?
portant industrial and
to
This
government.
What Chance lor
tion at the huge rate
vulnerable
be
Continued from first page
.
which the Israelis have created in
Prevailing over these detailed insufficient to fill the critical
coupled
with their
Ways must be de¬
considerations
which
we
have capital gap.
seemingly cantankerous behavior
vised to make investment attrac¬
.and the balance of trade.
Corp. (handling money for Orien¬ toward the United Nations, have cited—and justiiiedly controlling
tive to the world's capitalists —
—is the very real competitive at¬
By way of specifically and con¬ tal and Mediterranean Jews).
created a situation which truly is
tractions offered to the American irrespective of their race or creed
American Palestine Trading "hot."
structively wooing the foreign en¬
investor at home.
Assuredly the —on a businesslike basis of return.
trepreneur, Parliament in March, Corp. (known as "Ampal," chiefly
The Overhanging Fiscal
1950 enacted The Law for the En¬ investing the funds of 17,000 indi¬
Difficulties
couragement of Capital Invest¬ vidual American investors with
portance to its struggle
•crisis in
*
.
(624)
production, raw
Israel-Argentine Investment Co.
Israel Investment and Finance
with the
materials,
the
Arabs,
.
Sees income Taxes "Worked to Death"
through the labor federation,
These various potential threats
as Israeli partner).
to the foreign capitalist must be
motive and aim of the Law, as
Palestine Corp. Ltd. (with Brit¬ viewed
The August "Monthly Bank
against a background of the
■explained in its preamble, are to ish clientele, with operations now country's critical general, economic Letter," published by the National
induce voluminous and productive limited because of Britain's ex¬
position, reflected in the large City Bank of New York, contains
capital imports, and to get them change restrictions).
trade deficit and balance-of-pay- a strong condemnation of piling
invested as enhancers of produc¬
These investment companies, or ments squeeze. Although, as was
up
additional increments to in¬
"investment trusts," also act and, indicated in last week's article,
tivity—filling the void in the na¬
come
tax levies, and points out
tional income and available funds usually as their major function, in solvency
may
be
preserved that in no other nation does this
ments, functioning
Investment
through
a
so-
and
The
Center.
called
Histadrut,
im¬ taking entire charge of handling through the help of charity funds class of tax returns represent so
the funds of the individual foreign and bond sales in America; never¬
large
a
proportion of national
investor who is unwilling or un¬ theless the
convertibility of the revenue.
uctivity of goods which are now able to function in a managerial currency in any satisfactorily siz¬
"The fact is," states the "Bank
imported, and the increase of ex¬ role. Because of their expertness able proportions, pertaining to the Letter," "that in this country in¬
midst the complexities, they would foreign capital invested, must come
ports.
taxes, both personal
and
appear to constitute the best med¬
necessarily be barred.
As a corporate, have been worked to
An Investors' Clearing-House
ium for the placement of his cap¬
This is shown in the high
result, the "privilege" of with¬ death.
urged
The functions of the Investment
ital.
include fur¬
information on investing
problems; examining capital in¬
vestment proposals for their con¬
formity with tfie Law's purposes
as
we
have stated them above;
ministering the law,
nishing
of
drawal
Center which is charged with ad¬
There
which
are
have
the foreign
a
been
host
of
factors
discouraging
the
to
Drawbacks and Disadvantages
to
investors, whose jus¬
tification should be examined. Of
hard
given
enterprises" is
have
generally limited to a maximum
10% of capital and/or profits.
ceiling (subsequently redownward)
is a great
handicap rather than a privilege,
they
revenues, and reaching the
amount of personal income
for
.
other country in
Probably in no
a
visable
the world is the revenue so
ily
dependent upon
heav¬
this type of
•
designated
Since its establishment to June
enterprises have been
Z0 last, 519
approved,
totaling
30
million
pounds, of which one-third has
come from the United States; sub¬
Zionist
General
("Free
Enter¬
tlesome vicious circle.
foreign
Shortage of
entails
currency
incon¬
prise") Party — that it will be
vertibility which in turn prevents
even further extended during the
the influx of the investors' capital
long-term future.
required to produce the needed
A seriously deterring factor to
foreign currency.
the prospective investor of indus¬
trial capital is the possibility of
Devaluation Threat
symptoms of revolt on
the
taxpayer.
the part of
One manifestation
of the pro¬
•
tion
of the
Board
projects
in
at the discre¬
the Invest¬
of
ment Center,
have the privilege of
drawing out, in the same currency
which
.
mum
ment
had
been
of 10%
put
of the
in,
a
maxi-
total invest¬
annually, for the repayment
of capital, amortization of the en¬
terprise, dividends and profits.
If they settle
t>e
in Israel, they
permitted to keep foreign
rency.
■
.
'
may
cur¬
•
hotels,
entering enterprises.
The
Nationalization
Alleged possibility of national¬
industries, and the per¬
sistent refusal to introduce legis¬
expressly
another
matter
forbidding
about
it,
which
while
a
hard-and-fast
anti-nationalization
guarantee
undoubtedly
be
psycho¬
are
offered to
other
these, "approved" enterprises not¬
would
ably in tax phases. Their tax rate
tmrden is halved, from 50 to 25%
bor's
of
earnings; accelerated deprecia¬
tion
at
twice
approved
the
rates
enterprises,
is
ted; research expense can
to
non-
permitr
be writ¬
rate"
taking
more
individual's
investment
of
funds with the provision that
be, wholly
$1
foreign
they
permanently
and
a
25%
The
timing of devaluation is not
simple problem, for many rea¬
sons
including the needed assur¬
ance
that
the
rate
new
can
ybe
but its ultimate eventuality
Although it is not nec¬
is certain.
bring capital in at the
official $2.80 rate (as is the case
to
essary
own
self-interest.
Labor's
continuing domination over
dustry is preserved through
network of
in¬
the
cooperative ownership.
Under nationalization such
nation and control by
domi¬
labor would
with
deals
are
made
by
government, it nevertheless
unquestionable
when
effect
excises, the committee would do
away with it entirely, except for
taxes on liquors and tobaccos and
levy instead a general,
board
consumer
Or
of
sentials
across-the-
sales, tax cn all
products save the es¬
excise,
between
and
tax
and
clothing
food,
As
retail
a
manufacturers'
a
tax, the committee weighs;
excise
the pros
and
and comes out
cons
an
in favor of the latter levied at the
in¬
point of final manufacture.
The
manufacturers' tax was chosen
people seek the sanctuary of
investment.
Others
desperation and resent¬
legitimate devices
income
concealment.
Some
in
turn
mainly
and
because
greater
of
ease
lower cost of administration,
avoidance
sales
retail
with
conflict
of
the
and
taxes
State
long
experience record with this tax as
applied
to
;■■r
committee
"The
the
individual
numerous
commodities.
■
that
estimates
manufacturers' tax
of all other
proposed
replacement
(after
excises
now
levied
of
liquor
the
with
ception
and
ex¬
tobacco
taxes) at lVz% would yield addi¬
tional
10%
of
revenues
$3.0 billion, at
$7.4
$5.4 billion and at 12%
billion.
it
comes
some
that
will
loss to
the
seems
devaluation
necessarily
the
owner
of
Arc
Taxes Hard
Sales
ment to the less
of
defy
even
housewives
and
hold
taxes
on
Thus
non
Treasury—as the
who refuse to with¬
the
remit social security
their
domestic- help.
- compliance
becomes
charity,
special
revenue.
of
pressing itself in various forms of
tax avoidance.
As the tax bears
down
more
and
more
heavily,
more
national
the
of
tax-exempt
blocked.
a
25%
Instead, however, of extending the
present 'illogical, inequitable and
discriminatory' system of selective
company's
than
or
etc.;
at
serving the incentive to earn and
save, but discouraging spending,
the principal cause of inflation.
sales
more
general and the revenue
government
and
system is weakened.
Our tax
bond funds from America), and
the rate is avoided through the system has been administered suc¬
cessfully because it has had the
countries,
nationalization import of machinery in partial
voluntary support of the public.
actually work against la¬ place of currency, and although
This
becomes
impossible
when
Import duties may be waived
logically
effective, actually the
on
machinery and plant for Ap¬ fear is
groundless. This is so be¬
proved Undertakings.
cause here, in direct
contrast to
Other concessions
the
held,
complaining.
would
"investment
is
Is¬
rael-eying
American
industrial
capitalists have been vehemently
But,
the
for
Fear
ization of
lation
preferential food,
and
taxing income as it is spent,
rather than as earned, thus pre¬
posal for a Constitutional amend¬
ment prohibiting the Federal Gov¬
ernment (save in wartime) from
a
Foreign i investors
time it
At the same
tax.
large
that
another escapes,
or
means
medicines.
in view of the concessions offered
thus classified may,
income
has been the progress
disappointing result growing direct competition, be¬
Of foremost interest to the for¬ come, with a similar limit on gift
yond
that
a 1 ready
existing
While the
eign investor in these phases is and inheritance taxes.
•and the far greater need! v
from business owned and man¬
the threat of future devaluation proposal,
now
approved by 21
The
projects defined as Ap¬ aged
by
Histadrut,
the
labor
arising from the present fictitious State legislatures, may not be the
proved Undertakings are so clas¬ federation.
While the effective¬
soundest way of dealing with this
gross overvaluation of the Israeli
sified by the Investment Center on ness
its competitive activi¬
of
Whereas the pound's problem, it appeals to the harried
the basis of their likelihood to in¬ ties is controversial, it already is currency.
true value as quoted on foreign taxpayer as holding some promise
crease
productive
capacity
on "Big Business" owning or man¬
of a curb on the unlimited au¬
essential
supplies,
improve
the aging 14% of the country's indus¬ exchanges and on the black mar¬
ket at home is about $1, there are thority of the Federal Government
nation's balance of payments, de¬ try, monopolizing such things as
three rates set by the government: to pick his pocket.
velop natural resources, and help agriculture, cement production and
"Far more important than such
The "official rate" for conversion
in the absorption of new immi¬ the bus services, and showing a
of $2.80; the "tourist rate" at a 25% organized
movements has been
grants. They have been granted strong proclivity to force itself
discount for tourist expenditures the spontaneous resistance of
the following special privileges:
in as a 50-50 partner in newly
countless individual taxpayers, ex¬
on
stantial, but
reason
one
"The Committee on Federal Tax
possibly the greatest fundamental
freezing the investor's recovery of tax. In Great Britain and Canada
between in¬ importance, which it is difficult his assets over a long term, and only about half the total revenue
vestors and government offices; to disregard, is the pervasiveness meanwhile
partially transforming is in the form of such taxes.
.and, of the greatest importance, of government intervention his invested assets to a mere
"Still other indications that the
classifying projects as "approved throughout -the economy, and the
income tax has been getting too
bookkeeping item.
undertakings"; and making rec¬ everpresent possibility — despite
growing
This situation represents a net- greedy have been the
ommendations for special reliefs last week's electoral gains by the
and allowances to such
the
Policy, in its study . * ., recom¬
mends stepping up the contribu¬
tion of excise taxes to at least
maintaining contact
projects.
with
accords
been
to
rates
of
Such
which
This
principle of broadening the tax
base, giving added stability to the
pushed, and in the top-heavy pro¬
portion they now represent of the
total Federal revenue—over 80%.
currency
"approved
many
tax
more
excises.
and
experts have
emphasis upon the
independent
occasioned by the large-scale
migration. The emphasis through¬
out is heavily on increased prod¬
business
of
sentatives
people feel they are being robbed
of their substance.
An Alternative
Program
"Realizing the lengths to which
income taxation has
gone,
repre¬
the
on
Poor?
"There
and
tax
on
of
is,
great hue
course,
against the general sales
cry
the
ground that it is "re¬
gressive"—that is, takes
proportion
of
large income.
supposed
to
larger
a
than of
small
a
a
For this reason it is
political
be
poison
despite its widespread acceptance
in the States.
As
much
of
opposition .to
sales
taxes
appears
based
upon
the
parrot-like
prejudices
matter of fact,
a
to
be
repetition
rather
formed opinion.
.
of
than
.
popular
upon
in¬
.Volume 174
Number 5038
.
.
Commercial and Financial Chronicle
The
.
Indications
(625)
The following statistical tabulations
of Current
latest week
Business Activity
week
or
month available.
or
month ended
Latest
Indicated
steel
Equivalent
operations
(percent of capacity).
Month
Week
AMERICAN IRON AND STEEL INSTITUTE:
Previous
Week
Ago
-Aug. 19
101.5
101.1
on
(net tons),
Aug. 19
2,029,000
2,021,000
Crude
oil
condensate
and
output
—
daily
(bbls.
average
101.9
Previous
Yea*
Month
Ago
100.1
2,037,000
1,930,600
42
of
AMERICAN
Crude
to
runs
Aug.
stills—daily average
(bbls.)
.
4
6,200,750
Aug.
4
116,488,000
Gasoline output (bbls.)
Aug.
4
21.446,000
Kerosene
Aug.
4
2,425,000
output
(bbls.)
Distillate fuel oil output (bbls.)
Residual fuel oil output (bbls.)
6,024,600
§6,396,000
21,539,000
2,540,000
8,174,000
6.168,800
6,601,000
5,944,000
21,837,000
Stocks at refineries, at bulk terminals, in transit and in pipe lines—
Finished and unfinished gasoline (bbls.) at
Aug.
8,858,000
9,308,000
8,079,000
4
119,616,000
121,156,000
126,758,000
108,895,000
at
Aug.
4
27,677,000
Distillate fuel oil
26,859,000
25,446,000
(bbls.)
at
4
79,185,000
76,938,000
69,608,000
(bbls.)
at
4
45,200,000
44,957,000
42,857,000
41,791.000
Aug.
4
813.366
819,875
588,246
837,430
Aug.
4
672,010
673,492
589,241
702,521
CONSTRUCTION
—
NEWS-
ENGINEERING
/
IN
9
$216,941,000
$267,571,000
$361,028,000
construction
Aug.
9
78,299,000
158,404,000
65,535,000
87.469.00C
Aug.
9
Public
construction
State
f
.
and municipal-
—.....—————Aug.
...
Aug.
Federal
S. BUREAU
(U.
and
coal
138,642,000
109,167,000
295,493,000
76,549,001
9;
89,860,000
83,085,000
145,532,000
67,061,006
9
48,782,000
26,082,000
149,961,000
9,488,000
Aug.
10,005,000
1,480,000
10,563,000
4
4
737,000
861,000
99,000
62,412
73,304
67,463
$802,455
$777,318
456.736
694,287
233,205
234,024
263,308
105,857
86,558
101,026
6,869
7,544
8,861
"$37,800
$29,700
of
pericd
(tons)
PERMIT
AREAS
OF
VALUA¬
THE
U.
S.
LABOR —Month
OF
of
construction
,
residential
nonresidential
Additions,
.
alterations,
etc
INCORPORATIONS
STATES—DUN
UNITED
BUSINESS
of
(NEW)
STORE
0150,200
56,700
142,500
4
253
->232
218
296
>10,270,000
MERCE
NEW
(million
of
IN THE
u
—
100
=
output
nrrrm
INSTITUTE:
(in
Aug. 11
kwh.)
000
INDUSTRIAL)—DUN
AND
i
7,069,890
7,003,209
6,738,873
II.
May
S.
Aug.
149
9
171
173
194
July
COMPOSITE
S.
Aug.
Pig
iron (per gross ton)
Scrap steel (per gross ton)
Aug.
Aug.
4.131c
4.131c
3.837c
$52 69
$52.69
.$52.69
$46.61
$43.00
$43.00
$43.00
$39.17
4.131C
7
7
7
PRICES
Electrolytic
(E.
& M.
J.
Lead
refinery at
refinery at
Lead
(St.
Zinc
(East St.
\
Louis
'"
.
MOODY'S
U.
S.
)
Aug.
8
24.200c
24.200c
24.200c
22.200c
"I.-Ill—III——"IIAug.
8
27.425c
27.425c
27.425c
22.425c
I_I__ II I_I I Aug.
8
103.000c
103.0( 0C
103.000c
99.250c
Aug.
8
17.000c
17.000c
17.000c
12.000c
IIAug.
8
16.800c
16.800c
16.800c
and
;/
8
17.500c
17.500c
17.500c
Id.OOOi
~
at
;
' •
fllVi
(
s
v
,
—
.
PRICES DAILY AVERAGES:
Government Bonds
98.59
98.19
97.67
102.0."
110.88
110.52
109.97
116.01
115.63
115.04
114.27
coal
and lignite (net tons)
anthracite (net. tons)
(net
coke
tons)
—
.
113.89
113.31
119.61
109.97
Baa
109.60
108.88
115.63
104.14
103.80
103.64
108.8t
107.62
107.09
106.56
111.62
110.70
110.15
109.42
117.00
_Aug. 14
(BUREAU
114.66
114.46
113.70
110.82
—Aug. 14
2.59
2.62
2.65
2.35
Aug. 14
YIELD
DAILY
3.12
3.14
3.17
2.8t
2.90
AVERAGES:
Production
Oven
(net
coke
corporate
Aaa
COTTON
632,020
(DEPT.
(net tons)
U.
AGRICULTURE—Estimates
DEPT.
S.
as
Production
500-lb.
—
SALES
Adjusted
seasonal
lor
seasonal
Without
200
Aug.
2.61
Industrial
2.99
2.67
Railroad
Aug. 14
Aug. 14
Aug. 14
,3.17
3.23
2.87
3.50
3.52
3.53
3.23
RE¬
Averagc=100)
308
3.30
3.33
3.36
3.08
3.20
2.80
Average
2.93
2.97
19,000
YIELD
STOCKS—Month
of
$27,273,000
$27,090,000
-
OF
July:
PAINT
5.90
4.86
4.50
3.35
3.48
3.7*
464.5
467.0
478.3
447.6
6.20
6.55
6.17
6.38
6.79
6.36
249.5
*249.0
164.1
*164.8
167.8
"168.2
74.4
*75.0
*61.3
45.0
*45.3
"40.*
20.2
•20.1
28.2
*27.8
(10)
(200)
(DEPARTMENT
354,939
181,072
267,786
4
223,232
231,788
157,089
total
employer disbursements.—
Commodity producing industries
219,000
Aug.
4
94
97
62
98
Aug.
4
664,707
537,591
657,277
income
personal
and salary
receipts,
—
Total
334,123
Aug.
,
4
COMMERCE)—Month
OF
(in billions):
May
Wage
Aug.
637,177
iJiuuanies
■UiowiL-uuve
—
industries
Service
AVERAGE
=
Less
DRUG
REPORTER
PRICE
INDEX
—
1926-36
employee
contributions
insurance
100
Aug. 10
148.0
148.2
149.4
128.1
TRANSACTIONS
LOT
DEALERS
FC/R
AND
THE
SPECIALISTS
EXCHANGE—SECURITIES
Odd-lot
sales
Number
ON
EXCHANGE
dealers (customers'
by
of
ODD-LOT ACCOUNT
THE
N.
OF
Y.
ODD-
STOCK
Odd-lot
orders
July 28
|
34,654
35,956
769,249
989.523
1,096,323
$34,542,353
$41,495,139
$44,778,927
purchases by
dealers (customers'
of orders—Customers'
July 28
V 28,232
22,682
26,332
31,685
571
256
25,761
31,429
short sales
July 28
other
July 28
sales
664
27,568
604
J
22,678
20,521
22,106
Customers'
other
sales
July 28
774,155
603,560
740,903
$34,535,137
$26,161,621
$30,934,737
July 28
202.270
174,960
201,880
242,830
202,270
174,960
201,880
242 830
Number
1926
—
»
|
DEPT.
OF
384.530
318,500
417,780
Ol
—
275
223
247
230
222
INDEX
AGRICUL¬
1914~10<)—As
grain
grain
and
hay
Aug.
.
7
177.8
">177.6
179.7
7
192.0
139.9
156.3
177.6
7
177.2
178.3
179.5
■168.6
tNot
266.6
264.0
7
188.7
"185.9
186.2
allied
387
246
195
209
225
178
380
Meat
385
248
335
340
269
418
428
342
270
273
230
221
215
15*
$1,351,000
1,017,700
Aug.
7
278.6
275.3
275.6
255.3
7
166 4
"166.9
158.2
169.8
"172.6
177.1
149.3
7
137.7
137.7
137.7
134.4
7
188.1
188.2
188.2
"$1,374,000
1,024,385
_
.'
Aug.
——
7
223.6
224.2
224.2
Aug.
7
348.1
350.2
249.8
Aug.
—
^Includes
547,000
barrels
of
—
STATES
(000's
OF
EXPORTS
AND
IMPORTS-
CENSUS —Month
of
May
omitted);
Exports
Imports
UNITED
STATES
GROSS
DEBT
7
140.0
139.3
140.5
foreign
crude
runs.
§Ccr rected figure.
212.3
t
121.4
GUARANTEED—(000's
As
of
July 31
General fund
Net
debt
Computed
"Revised
.
„
-
omitted):
0*1
—-
balances
—1
annual
——
—
JNot including stocks
$829,000
659,090
^
,
of Amer. Tel. & Tel.
om
c'c^q'qvI $257^fi??8
$257,556,877
5,619,924
1,306,518
4,500.477,
$250,065,023
$247,894,625
$253,056,400
2.267#
rate
figures.
...
DIRECT AND
174.0
products
products
Poultry and eggs
155.5
7
Aug.
focds
1
available.
and
animals
174.4
Aug.
and
Fuel and lighting materials
and
7
Aug.
farm
pioducts
Metals and metal products
Building materials
Lumber
438
363 "
239
crops
241.6
265.6
Aug.
;;
•
than
J.90
428
Livestock
186.3
Aug.
other
24T
357
•
—
Oil-bearing crops
BUREAU
commodities
"Revised,
309
223
DEPT.
J 909-July,
Cotton
UNITED
Aug.
Aug.
Aug.
Chemicals
•199.9
Tobacco
424,110
100:
Meats
•14.3
*227.8
15:
Truck
LABOR—
products
Textile
3
S.
Foods
■•I
l
SERIES—U.
Livestock
All
12.1
228.1
244
FARMERS
BY
S.
Dairy products
July 28
PRICES, NEW
Grains
'
22,307
July 28
July 28
commodities
Farm
763,210
by dealers—
of shares
pmOLESALE
"18.4
194
sales
sales
purchases
*20.2
305
—
by dealers—
sales
Other
"S.5
"42.*
12.7
income
Crops
$34,540,019
Round-lot
All
May
532,884
July 28
value
Short
•
*2.9
*3.3
*48.1
20.2
Unadjusted—
All farm products
10,001
July 28
Number of shares—Total
*3.4p
3.8
271
RECEIVED
NUMBER —U.
Feed
625,726
sales
Round-lot sales
18.5
21.0
48.7
payments
TURE—August,
Food
794,676
short
Dollar
3.7
'.
transfer
942,?85
July 28
Customers'
v
"141.2
~
rental
nonagrlcultural
PRICES
of
sales)—
total sales
Customers'
Number of shares—Total sales
)
I
26,927
942,476
$43,139,534
Customers'
;
31,587
Julv 28
July 28
„
value
Number
s
•138.3
purchases)—
Number of shares
Dollar
Total
Total
"216.9
•»'
'
income
interest income and dividends—
Personal
COMMISSION:
social
for
income
labor
Other
Proprietors' and
STOCK
5.99
,
PERSONAL INCOME IN THE UNITED STATES
—
AND
5.89
5.72
4.79
Government
OIL.
7.03
6.46
—
2.66
ASSOCIATION:
Percentage of activity
Unfilled orders (tons) at end of period
AVERAGE
(125)
Insurance
3.16
2.92
Aug. 14
INDEX
(tons)
(tons)
283
(15)
3.13
of
Production
362
"284
(24)
futilities
Banks
"301
240
variations
(25)
Aug. 14
II
PAPERBOARD
283,243
10,012,000
17,266,000
(000's omitted)
31
COMMON
2.94
Total
received
■.
1
adjustment
WEIGHTED
2.96
i,
Orders
May
of
MOODY'S
Aug. 14
Public Utilities Group
Industrials Group
223,886
July:
of
3.19
Railroad Group *
NATIONAL
723,671
OF
:
(FEDERAL
SERVE SYSTEM)—(1935-39
Month
of
bales
gross
DEPARTMENT STORE
2.87
—
COMMODITY
5,657,49*
580,573
1,444,663
.
COMMERCE):
OF
(exclusive of linters) to Aug. 1
PRODUCTION
2.92
.
MOODY'S
6,122,225
"624,938
1,395,394
tons)
at end of month
GINNING
Aug. 14
A
>;<
6,238,067
5,942,955
tons)
(net
Oven coke stocks
—Aug. 14
Aa
Baa
•6,747,163
6,574,975
tons)
(net
ooke
Beehive
—As
Government Bonds
Average
506,600
OF MINES)—Month of June:
MONEY IN CIRCULATION—TREASURY DErT.
BOND
2,855,000
632,000
120.84
114.66
S.
"35,109,000
"3,743,000
July:
COTTON
Aaa
U.
44,014,000
(BUREAU OF MINES)—Month
Running bales
:
■,
BOND
MOODY'S
115,655
538,900
municipal
11.800c
—Aug.
I
at.
at
Louis)
368.21*
180,864
34,462,000
construction
Bituminous
COKE
tin (New York)
(New York) at
475,869
402,522
of
QUOTATIONS):
Domestic
Export
,699,260
583,386
of
NEWS-RECORD— Month
Pennsylvania
copper—
Btraits
$1,175,138
443,701
DE¬
CONSTRUCTION—EN¬
Beehive
'
$1,027,087
2,790,000
S.
Month
construction
COAL OUTPUT
of
U.
—
construction
Public
State
PRICES:
'$210,500
533,494
—
COMMERCE
(000's omitted):
U.
Federal.
Finished steel (per lb.)
$516,400
REPORTED
(000's omitted)
ENGINEERING
$53,600
448,143
OF
"$68,500
981,637
CORPORATIONS
9.500
14,400
397,003
PUBLICLY
—
11,700
$1,378,640
—
"19,000
$209,500
—
12,000
$69,900
DIVIDENDS
GINEERING
6,253.141
BRAD-
&
STREET, INC.
AGE
May
19,100
—
Private
(COMMERCIAL
of
——
Total
FAILURES
Month
—
—
Total
CASH
CIVIL
ELECTRIC
SERIES
COM¬
OF
DEPT.
dollars):
PARTMENT
SYS¬
RESERVE
INDEX—FEDERAL
SALES
TEM— 1935-39 AVERAGE
METAL
$1,058,621
BRADSTREET,
&
June—:
INVENTORIES,
Manufacturing
BY
DEPARTMENT
IRON
84,116
20,417
928,000
144,100
Aug.
!
(tons)
coke
4
Aug.
Aug.
r
anthracite
Beehive
Electric
15,791
MINES):
OF
lignite (tens)
(tons)
Pennsylvania
■DISON
79,299
11,400
omitted):
building
Retail
OUTPUT
Bituminous
'
77,86ft
83,346
$38,800
end
at
DEPT.
Wholesale
COAL
77,679
lbs.)
(tons)
2,000
period
$164,018,00(
Private
■
of
INC.—Month
Aug.
6,192,43#
463,393
of
URBAN
S.
New
,
S. construction
U.
8,082,9»1
6,938,708
78,955
end
BUSINESS
ENGINEERING
"8,656,960
6,645,897
output, all grades (tons of
(tons
(000's
New
RECORD:
8,696,000
including alloy
tons)—Month of June-
CONSTRUCTION
U.
May
All
freight loaded (number of cars)—
Revenue freight received from connections (number of cars)
}
INSTITUTE, INC.—Month of
orders
TION
—
ASSOCIATION OF AMERICAN RAILROADS:
Revenue
castings produced
July
products,
(net
smelter
at
Unfilled
62.235,000
Aug.
f
\i
lbs.)
BUILDING
23,560,000
Aug.
Residual
'
zinc
2,000
Stocks
9,020,000
9,014,000
Slab
7,419,000
8,762,000
Total
of
INSTITUTE:
July:
Shipments
4
CIVIL
steel
stainless
2,055,000
1
4
fuel oil
of
STEEL
steel for
tons)—Month
(net
19,783,000
2,276,000
Aug.
(bbls.)
AND
ingots and
Shipments
5,640,350
-Aug.
Kerosene
IRON
AMERICAN ZINC
gallons each)———
date:*j
Latest
INSTITUTE:
PETROLEUM
of that
Month
and
AMERICAN
are as
either for the !
Ago
Steel
and castings
of quotations,
cases
are
Year
to—
Bteel ingots
in
or,
!
production and other figures for the
cover
Dates shown in first column
that date,
33
2.270#
2.200#
34
Chronicle
The Commercial and Financial
(626)
.
.
1951
Thursday, August 16,
•
* REVISIONS
Securities
Now in
Alabama Power Co.
Aug.
filed
10
1981.
$15,000,000 of
Underwriters—To be
first
mortgage bonds due
determined by competitive
bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
Morgan Stanley & Co.; Blyth & Co., Inc.; Harriman Rip¬
ley & Co., Inc.; Shields & Co. and Salomon Bros. &
(jointly); Drexel & Co.; Union Securities Corp.
and Equitable Securities Corp. (jointly); Kidder, Peabody & Co.; The First Boston Corp.; Lehman Brothers.
Proceeds—For expansion program.
Bids—Expected to
11
a.m.
(EDT)
on
Sept. 11.
Telephone Corp., Juneau, Alaska
July 18 (letter of notification) $300,000 of b% 20-year
convertible debentures and
75,000 shares of common
stock (par $1 per share) to be reserved for conversion of
debentures. Price—To be supplied by amendment. Un¬
derwriter—Tellier &
Co.; New York. Proceeds—For ex¬
and modernization needs and working capital.
Offering—Expected sometime in September.
pansion
Axe-Houghton Fund A, Inc.
Aug. 14 filed 1,000,000 shares of capital stock
„
Price—At
(par $1).
General Distributor—Axe Securities^
market.
Proceeds—For investment.
Corp., New York.
Botany Mills, Inc.
Aug. 10 (letter of notification) 500 shares of 5% cumula¬
tive preferred stock (par $25). Price—At market (esti¬
mated at $14 per share). Underwriter—None, but Goodbody & Co., John P. White & Co. and P. F. Fox & Co.
of New York, will act as brokers.
Proceeds—To Otto E.
Kuhn, Vice-President, who is the selling stockholder.
Central Eureka Mining Co. (8/24)
Aug. 7 filed 300,000 shares of capital stock to be offered
to stockholders of record Aug. 24 on basis of one share
for each two shares held, with an oversubscription priv¬
ilege; rights expire on Sept. 28. Price—At par ($1 per
share.)
Underwriter — None. Proceeds — For develop¬
r,
Superior Refining Co., Superior, Wis.
of notification) 700 shares of common
stock, to be offered to present stockholders.
Price—At
par ($100 per share).
Underwriter—None. Proceeds—
(letter
6
lease, refining and working capital.
For
paper; rights expire
aforementioned holders
Underwriters — Louis
Rogers Co. and Graham, Ross & Co., Inc., New York.
Proceeds—For
working capital.
Corp., Seattle, Wash.
Aug. 10 (letter of notification) 23,600 shares of class A
common stock (par $3).
Price—$10 per share.
Under¬
writer—None.
Proceeds—To purchase additional sites
and to construct and equip
service stations thereon.
Office—2124^ Third Ave., Seattle, Wash.
Mullan Metals, Inc., Wallace, Idaho
"
Aug. 6 (letter of notification) 300,000 shares of assess¬
able capital stock (par 10 cents).
Price—15 cents per
share. Underwriters—Pennaluna & Co., Wallace, Idaho,
and R, L. Emacio & Co., Inc., Spokane, Wash. Proceeds
—For development of mining property.
Mutual
Products: Co.,
Minneapolis, Minn.
Aug. 8 (letter of notification) $200,000 of five-year 8%
registered debentures. Price—At par (in denominations
of $100 and multiples thereof).
Underwriter— None.
additions
Proceeds—For
to
property
and
for working
Office—509 N. Fourth Street, Minneapolis, Minn.
capital.
Wv."-
'.v!\
'.YrV
-V
'•
:/
*
.Vv
V\',
■ -■
'''*
:
Central Pharmacal Co., Seymour, Ind.
Aug. 7 (letter of notification) 8,020 shares of 5% cumu¬
lative preferred stock.
Price—At par ($20 per share).
Underwriter
None.
Proceeds —For working capital.
Office—120-128* East Third Street, Seymour,
Colonial Acceptance Corp.,
Ind.
Chicago, III.
10,000 shares of class A
stock, first series (par $1). Price—At market
(estimated at about $4.50 per share). Underwriter—,.
Straus & Blosser;'and probably others. Proceeds —To:
(letter of notification)
common
David J. Gradman, President, who is the selling stock¬
holder.
Concord
Fund, Inc., Boston, Mass.
filed 117,810 shares of capital stock
Price—At market.
Underwriter—A.
E.
(par $1).
Weltner
Inc., Kansas City, Mo., and New York, N. Y.
&
Co.,
Proceeds
—For investment.
Dumont Electric Corp. (8/17)
Aug. 10 (letter of notification) 40,000 shares of cumula¬
tive convertible preferred stock (par $1) to be offered
to common stockholders of record Aug. 17 at rate of
one preferred
share for each 10 common shares held;
rights to expire Sept. 5.
Price—$4.75 to stockholders
and $5 per share to public.
Underwriter—Aetna Securi¬
ties Corp., New York. Proceeds—For expansion and for
development of new products.
Lynch,
Proceeds—To
Price
—
Y.
Shuttle-Wyze Carpets, Inc., Morgantown, W. Va.
Aug. 8 (letter of notification) 30,000 shares of common
stock (par $5).
Price—$5.50 per share.
Underwriter—
Joe McAlister Co., Greenville, S. C.
Proceeds—For gen¬
eral corporate purposes, including pip-chase of machinery
and Equipment and raw materials and for working
capital. '
»Slick Airways, Inc., Burbank, Calif.
Aug. 14 filed 147,301 shares of common stock to be of¬
fered for sale to holders of presently outstanding Em¬
ployee Option Warrants and Stockholders Option War¬
rants.
Price—At
None.
Proceeds—To
par
($10 per
purchase
other corporate purposes.
share).
Underwriter—
equipment and for
new
c
,
.
Snyder Chemical Corp., Bethel, Conn.
Aug. 8 (letter of notification) 7,625 shares of common
stock (par one cent).
Price—$4.50 per share. Under¬
writer—Coburn & Middlebrook, Hartford, Conn.
Pro¬
ceeds—To
Francis
H.
Snyder,; President,
who
is
the
Equipment Finance Corp., Charlotte, N. C.
Aug. 6 /letter of notification) 2,774 shares of common
stock.
Price—At par ($100 per share). Underwriter—
None,
Proceeds—For operating capital.
Office—1026
Charlotte, N.
C.
1
-
selling stockholder.
Tennessee Gas
Aug.
10
filed
Transmission
$45,000,000
of
first
Co.
Kingsburg Cotton Oil Co., Kingsburg, Calif.
(letter of notification) 5,000 shares of common
(par $1).
Price—At market "between $4.12% and
share." Underwriter—The Broy Co., San Fran¬
cisco, Calif.
Proceeds—To Leonard A. Gregory and
Willie R. Gregory, two
selling stockholders.
per
Kootenai
Aug. 3
stock.
Edward
Dike
Mines,
Inc.,
Coeur d'Alene,
due
mortgage
competitive
notes
and
Underwriters —To
1971.
bidding.
for
Probable
expansion
be
pipe
line
bidders:
program.
determined
Halsey,
by
Stuart
Offering—Expected
198,000 shares, or 15.1 % of
July 3.
Ida.
(letter of notification) 1,200,000 shares of capital
Price—25 cents per share.
Underwriters—Ray
Currie, President, and Richard William Benof-
American
Brake Shoe Co.
shares of common stock (no par) to
and key employees through
June 29 filed 50,000
be offered to certain officers
a
stock
Price—To be not greater than
purchase plan.
the date of the offering, or no less
85% of such price. Underwriter—None. Proceeds
be added to general funds.
'
;
the market price on
than
—To
,
American
Mucinum,
,
Inc.,
>
July 17 (letter of notification) 1,000,000 shares
A stock.
Price—At par (15 cents per share).
writer—To
be
American
of class
Under¬
Proceeds—For
Office—27 West 72nd Street, New
supplied by amendment.
operating expenses.
York 23, N. Y.
Trailer Co.,
Inc., Washington,
D. C.
(letter of notification) $120,000 of 5V2% first
mortgage bonds, due Aug. 1, 1961. Price—At 1001/2%
and accrued interest (in units of $1,000 each).
Under¬
writer—Mackall & Co., Washington, D. C.
Proceeds—
July 26
Transgulf Corp., Houston, Texas
Aug. 6 (letter of notification) 10,000 shares of capital
stock (par 10 cents).
Price—$1 per share. Underwriter
—S. B. Cantor
Co., New York. Proceeds—To Dudley P.
South, Sr., the selling stockholder.
Light Co. (9/19)
Aug. 9 filed 175,000 shares of common stock (no par).
Underwriters—To be determined by competitive bid¬
ding. Probable bidders: Blyth & Co. Inc.; W. C. Langley
& Co. and Glore, Forgan & Co. (jointly); Union Secu¬
rities Corp., and Smith, Barney & Co. (jointly); Lehman
Bros, and Bear, Stearns & Co. (jointly); Kidder, Peabody &.Co., and Merrill Lynch, Pierce Fenner & Beane
(jointly). Proceeds—To repay bank loans and to pro¬
vide additional construction funds. Bids—To be opened
at 11 a.m. (EDT) on Sept. 19.
ney
(jointly); Union Securities Corp., and Smith, Bar¬
& Co. (jointly).
construction
noon
(EST)
on
Proceeds—To repay bank loans and
program.
Oct.
Bids—To be received
Philadelphia
San Francisco
Private Wires
Pittsburgh
to
all offices
Chicago
Cleveland
up
to
29.
Wellington Fund, Inc.
Aug. 10 filed $5,400,000 -DW
Boston
^
.
of $3 cumulative and partici¬
pating preferred stock (no par)/ of which 54,444 shares
are first being offered to preferred stockholders of rec¬
ord July 6 at rate of one share for each 4V2 shares held
with rights to expire on Sept. 24; unsubscribed shares
to be offered publicly. Price—$45 per share. Underwriter
—None. Proceeds—To repay bank loans. Statement ef-,
fective July 6. *
;
,
1
?»,
Basin Oil
Corp., Evansville, Indiana
,
,
July 16 (letter of notification) $250,000 of 6% convert¬
ible sinking fund notes dated July 1, 1951 and July 1,
1956, and 25,000 shares of common stock (par 10 cents)
to be offered in units of $5,000 of notes and 500 shares
of stock (20 units to be offered in exchange for $100,000 of short-term notes).
Price—$5,000 per unit. Un¬
derwriters—Mason, Moran & Co., and Cruttenden & Co.,
both of
419
Chicago, 111. Proceeds—To drill wells. Office—
Bldg., Second and Sycamore Streets, Evans¬
Grein
ville, Ind.
Bigelow-Sanford Carpet Co., Inc.
May id, filed 100,000 shares of 4%% cumulative pre¬
1951 (par $100), of which 39,604*4
shares are issuable to holders of 26,403 shares of •6%
preferred stock
on
the basis oi.lVz shares for each pre¬
ferred share held.
Public offering of the additional 60,-
000 shares of new
preferred stock has been deferred due
to
Underwriters—Harriman
Peabody & Co., and F. S.
Proceeds—For general corporate pur¬
market conditions.
present
Ripley & Co., Inc.; Kidder,
Moseley
Blair
& Co.
^
Plans
-
(periodic
payment
plans with insurance protection); $9,000,000 DWN Plans
(periodic payment without insurance protection); and
$2,400,000 DWP Plans (single payment). Underwriter—
First Investors Corp., New York. Custodian—The Penn¬
sylvania Company for Banking and Trusts, Philadelphia,
Pennsylvania.
-
,
(Neb.)
,
"
Telephone Co.
18 (letter of notification) $175,000 of first mort¬
4% bonds, series A, due 1971. Price—101 and ac¬
crued interest.
Underwriter — Wachob-Bender Corp.,
July
gage
Omaha, Neb. Proceeds—To retire first mortgage (closed)
3% % bonds and to convert to dial operation.
,
...
Brass
& Copper
Sales Co., St. Louis, Mo.
July 9 (letter of notification) 2,807 shares of common
stock (par $10) to be offered to common stockholders of
record July 9 at rate of one share for each five shares
held, and 1,500 shares of 5% cumulative preferred stock
to be offered to residents of Missouri only first to com¬
mon
stockholders and then to public.
Price—Of com¬
$50 per share; and of preferred, at par ($20 per
share).
Underwriter — None.
Proceeds — For work¬
mon,
Office—2817 Laclede Avenue, St. Louis 3,
./../V'V
:v.v./. >0,-;,.:'V;'
ing capital.
Missouri.
Light Co. (10/29)
Aug. 9 filed $9,000,000 first mortgage bonds, due Oct. 1,
1981.
Underwriters—To be determined by competitive
bidding. Probable bidders: Halsey, "Stuart & Co. Inc.;
Kidder, Peabody & Co.; Lehman Brothers, and Bear,
Stearns & Co. (jointly); White, Weld & Co.; Salomon
Bros. & Hutzler; First Boston Corp., and Blyth & Co.,
for
,
June 11 filed 55,000 snares
.
Inc.
-
Co., Los Angeles, Calif.
Arden Farms
Utah Power &
NewYork
outstanding shares). State¬
ment effective
poses.
in September.
Utah Power &
'
Aug. 8
$4.25
Underwriter—None.
ferred stock, series of
& Co. Inc.; Stone & Webster Securities Corp. and White,
Weld & Co. (jointly). Proceeds—To retire short-term
stock
stock (par $2).
(approximately $15 per share).
Proceeds—To Allen & Co. (owner
market
the
Price—At
Pierce,
Grace
(no par). Price—At market, but not less than $37.37 per
share. Underwriter—None, but will be sold in over-thecounter market through brokerage houses to be selected
by company. Proceeds—To reimburse treasury for cost
of acquisition of such shares.
,
Springfield, Mass.
Washington, D. C.
$24.75 per share. Distributor —
Fenner & Beane, Chicago, 111.
Roper, the selling stockholder.
Office—340 Blackhawk Park, Rockford, 111.
(par $5).
Merrill
bonds
Boulevard,
Bosch Corp.,
filed 98,000 shares of common
To pay off present
indebtedness; and for additional
working capital. Office—4030 Wisconsin Avenue, N. W.,
El Paso Electric Coi, El Paso, Texas
Aug. 8 (letter of notification) 907 shares of common stock
So.
17
Roper (Geo. D.) Corp., Rockford, III.
Aug. 8 (letter of notification) 4,000 shares of common
—
Aug. 14
American
May
stock
ment program.
Aug. 10
IIIL *
July 26 filed 1,000,000 shares of common stock (par $1).
Price—$3 per share. Underwriter—May be M. A. Kern,
President. Proceeds—To increase capital and surplus.
of
McKales
Casualty Co., Chicago,
American
Ail
Aug. 31.
Priyee—$2 per share to
and $2.37 V2 per share to public.
L.
Ala.
Office—420
Proceeds—For plant expansion.
Birmingham. Ala.
Ala.
ham,
short-term
company's
..'•J
Graphite Co., Birmingham,
Flake
July 12 (letter of notification) $100,000 of 7% 20-year
sinking fund bonds dated Jan. 15, 1949 and due Jan.<15,
1969 (in denominations of $1,000 each). Price—At par.
Underwriter—Odess, Martin & Herzberg, Inc., Birming¬
Lowell Adams Factors Corp.
of
Registrations and Filings
Previous
:
Alabama
Comer Bldg.,
Aug. 9 (letter of notification) 126,300 shares of common
stock (par 10 cents) to be offered to common and pre¬
ferred stockholders of record Aug. 15 and to certain
holders
Alaska
Idaho.
Lake
Aug.
Hutler
be opened at
320, Powell Building, Coeur d'Alene,
—Room
(9/11)
ADDITIONS
Registration
sky,4 Secretary, both of Oakland, Calif. Proceeds—For
exploration and development of mining property. Ofiice
New Registrations and Filings
THIS WEEK
INDICATES
•
Burlington Mills Corp.
^
5 filed 300,000 shares of convertible preference
March
(par $100). Price—To be supplied by amendment.
Underwriter—Kidder,
Peabody
&
Co.,
New York.
Proceeds—For additions and improvements to plant and
stock
equipment. Offering date postponed.
,A
Canada
April 20 filed 200,000 shares of capital stock. Price—At
par ($1 per share). Underwriter—Harry M. Forst. Pro¬
ceeds—For exploration and development work.
1
Canam
Copper Co., Ltd., Vancouver,
-Carolina
North
Mountain
Telephone
Co.,
Weaverville,
Carolina
July 13 (letter of notification) 100,000 shares of capital
stock (par $1) being offered to stockholders on basis of
one
share for each two shares held on July 23; with
rights expiring
on
Aug. 24.
derwriter—Interstate
and four others.
Price—$2.15 per share. Un¬
Charlotte, .N. C.,
Securities Corp.,
Proceeds—To retire loans.
Volume 174
Number 5038
.
.
The Commercial and Financial Chronicle
.
Central Chemical Corp., Hagerstown, Md.
July 31 (letter of notification) 24,000 shares of 6%
(627)
Helio Aircraft Corp., Norwood,
non-
July 31
cumulative preferred stock
NEW ISSUE CALENDAR
(par $10) and 6,000 Shares
of pon-voting common B stock
(no par). Price—$10 per
share.
Underwriter — None.
Proceeds — For working
August 17,
capital.
Central
Dumont
Fibre
Quincy, III.
June 11 (letter of notification)
3,000 shares of non-voting
common stock (par $5).
Price—At the market. Under¬
writer—Bosworth, Sullivan & Co., Denver, Colo, Pro¬
ceeds—To two selling stockholders. Office—-901 S. Front
St', Quincy, 111.!
★ Columbus & Southern
Aug.
filed
8
$12,000,000
Ohio
Electric
of first
Co.
Missouri-Kansas-Texas
Underwriter—To
Bids—To
poses.
be
be
at
(9/5)
State Loan & Finance Corp.—
11:30
a.m.
(EDT)
11
1951
(CDT)
a.m.
Montana-Canadian
■
__-Common
Oil
Foods, Inc., Kansas City, Mo.
Aug. 1 (letter of notification) 89 shares of 6% cumula¬
tive preferred stock (par $100) and 424 shares of com¬
mon stock (no par).
Price—For preferred, at par; and
Central Eureka
common, at $20 per
& Land, Inc.,
share. Underwriter — Prugh,
Kansas City, Mo., will act as
dealer. Proceeds—For plant improvements and general
corporate purposes. Office—412 W. 39th St., Kansas City,
Mo.
1951
Corp
Common
August 24, 1951
on
v
Hilton Hotels
Corp., Chicago, III.
March 30 filed 153,252 shares of common stock (par $5)
offered to holders of
now
Common
Mining Co
dorf-Astoria
August 27, 1951
soft drink dispensing machines.
Peak Avenue, Colorado
Spencer Chemical Co
t
:
I
8:30
-
mon
(voting) stock (par $1). Price—$2 per share. Under¬
writers—Sills, Fairman & Harris, Inc., Chicago, and
Gearhart, Kinnard & Otis, Inc., New York. Proceeds—
Fpr working capital and general corporate purposes.
Temporarily deferred.
_
•
Columbus
11:30
Southern Ohio Electric
&
(EDT)__
a.m.
Alabama
American
Box
11:30
Bonds
—
18,
1951
September
19,
1951
(EDT)-.Common
Utah Power & Light Co., 11 a.m.
•
September 20,
Deardorf Oil Corp., Oklahoma City, Okla.
May 18 (letter of notification) 200,000 shares of edmmon
stock (par 10 cents). Price—70 cents per share. Under¬
1951
—Preferred
Harshaw Chemical Co
October 9,
-
Office-*- ;
Arkansas
Power
219
Fidelity Bldg., Oklahoma City, Okla. Offering—Tem- •
porarily postponed "because of market conditions;"
>
& Light
Co., Phila, Pa.
June 26 (letter of notification) 1,500 shares of common
stock (par 10 cents).
Price—At the market (approxi¬
$6.37 V2
to $6.62% per share).
UnderwriterBoyce, Phila., Pa.
Proceeds—To Harry
A. Ehle, Vice-President, who is the selling stockholder.
&
Feb. 21 filed $1,500,000 first mortgage bonds due in 1981.
Proceeds—For expansion program. Bids—Only one bid
was received by company on March 27, from Halsey,
Stuart & Co. Inc., which was returned unopened.
ing—Postponed
March
indefinitely.
Statement
Offer¬
effective
14.
Jersey Central Power & Light Co.
preferred stock
(par $100). Proceeds—From sale of preferred, together
with proceeds to be received from the sale of 350,000
additional common shares to General Public Utilities
Corp., the parent, will be used for new construction.
Bids—Only one bid, from Union Securities Corp. and
Salomon Bros. & Hutzler (jointly), was received March
27, which was returned unopened.
1951
Bonds
Co._L.
V
October
Utah Power & Light
Proceeds—For development of Liv¬
Office—Scott Bldg., Wallace, Idaho.
Feb. 21 filed 40,000 shares of cumulative
Bonds
(EDT)„_
a.m.
Bank Bldg., Spokane, Wash.
obligations.
Co
ingston mine.
Jersey Central Power & Light Co.
Bonds
September
Oct. 1. Price—30 cents per share. Underwriter—None.
pay
Bonds
New England Gas & Electric Association
-
Proceeds—For working capital. Office—824 Old National
Proceeds—To
Board
Wash., and others.
1951
September 12, 1951
Chesapeake & Ohio Ry.
Noon (EDT)
Equip. Trust Ctfs.
•
Offering—Postponed indefinitely. !
writer—None.
11,
/
!
(letter of notification) 800,000 shares of non¬
common stock (par 10 cents).
Price—25 cents
per share.
Underwriter—H. M. Herrin & Co., Seattle,
Stein Bros.
Co._
Power
8
assessable
mately
Co.
——
September
of, $100, $500 and $1,000 each). Price—91% of principal
amount. Underwriter—Boettcher
& - Co., Chicago, 111.
j
International Resistance
——Common
September 5, 1951
r
Continental Electric Co., Geneva, III.
March 2 (letter of notification) $300,000 of 6% sinking
fund debentures due Dec. 1, 1975
(to be issued in units
•
Mines, Inc., Wallace, Idaho
-
August 29, 1951
Jetter & Scheerer Products, Inc.
1.1 a.m. (EDT)
*
,
Cornucopia Gold Mines
May 14 (letter of notification) 229,800 shares of common
stock (par five cents) being offered for subscription by
stockholders of record June 30, 1951, on a one-fof-five
basis, with an oversubscription privilege; rights to expire
Bonds
—
Southern Counties Gas Co. of California-—-Bonds
Wilson Brothers
Debentures
Continental Car-Nar-Var Corp., Brazil, Ihd.
(letter of notification) 150,000 shares Of com¬
March 5
Proceeds—To retire indebtedness and for working capi-
(PDT)
a.m.
Aug. 27.
Co., New York.
June
Southern California Edison Co.
*
stock of Hotel Wal¬
in exchange for their holdings of
share-for-share basis; offer expires on
Dealer-Manager-—Carl M. Loeb, Rhoades &
a
Idaho Custer
August 28, 1951
Office—105 Vz East Pike
Springs, Colo.
Preferred
—
common
Corp.
such stock on
10
I
Hex
Combest
,
August 23,
(letter of notification) 300,000 shares of 6%
cumulative preferred stock. - Price — At par
($1 per
share). Underwriter—None. Proceeds—For purchase^of
on
Airport, Norwood, Mass.
for
August 22,
Foote Bros. Gear & Machine Corp. '
-Consolidated Equipment Corp.
tal.
—.——Common
mortgage
Sept. 5.
July
(CDT)
Equip. Trust Ctfs.
noon
National Distillers Products Corp.
Preferred
Seaboard Air Line RR
___Bonds and Stocks
determined
opened
Preferred
1951
RR.
Mass.
of notification) 7,750 shares of nonpreferred stock (par $1) and 7,750 shares
of common stock (par $1) tp be offered in units of one
share of preferred and one share of common stock.
Price—$25 per unit ($20 for preferred and $5 for com¬
mon). Underwriter—None. Proceeds—For development
and promotion expenses.
Office—Boston Metropolitan
(letter
cumulative
1951
Corp.__
August 21,
bonds, -.due
by competitive
bidding. Probable bidders: Halsey, Stuart & CpV lhc.;
Dillon, Read & Co. Inc.; Salomon Bros. & Hutzler; Leh¬
man
Brothers; White, Weld & Co.; Lee Higginson Corp.
and Carl M. Loeb, Rhoades & Co.
(jointly); Union Se¬
curities Corp. and Glore, Forgan & Co. (jointly).
Pro¬
ceeds—To repay bank loans and for construction pur¬
1981.
Electric
Products Co.,
35
29, 1951
Co., noon (EST)
Bonds
Drayson-Hanson, Inc., Los Angeles, Calif^^* \
(letter of notification) 50,000 shares of common
stock (par 40 cents).
Price—$1.20 per share. Under- f Thomson & McKinnon, Chicago, 111. Proceeds—To Frank
G. Fox, the selling stockholder. Office—2626 W. Monroe
writer—Edgerton, Wykoff & Co., Los AngeleSpCalif.
Proceeds—To purchase real property and plant.
St., Chicago, 111.
March 14.
Statement effective
Amendment—On May 8 SEC granted an ex¬
emption from competitive bidding. Preferred may beprivately
placed,
but reported,
temporarily aban¬
doned.
.
June 4
Fruehauf Trailer Co., Detroit, Mich.
Eastern Caramba Bottling Corp.
•
June 15 filed 115,000 shares of common stock (par $1), to
Aug. .7 (letter of notification) 250,000 shares of cqipmon
stock, of which 75,000 shares are to be issued to three % be "offered to certain employees pursuant to stock op¬
tion plans." Price—At 85% or 95% of the highest sale
officers (25,000 shares each) and an initial public, ojffprprice of the stock on the New York Stock Exchange on
ing will be made of 15,000 shares. Price—$1 per ! sfiare.
the day on which the option is delivered to the employee.
Underwriter—None.
Proceeds—For
general corjaorlite
Underwriter—None. Proceeds — For working capital.
^purposes. Office—615 Adams St., Hoboken, N/J. 1."
Statement effective July 17.
Financial Credit Corp., New York
'^r
Fuller (D. B.) & Co., Inc., N. Y.
July 27 (letter Of notification) $250,000 of Financfafin.
,
vestment
bonds.
Price—At par
$500 and $1,000 each).
To
Ray
(in units of $50, $250,
Underwriter—None.
Proceeds—
obligations, for expansion and working capital.
17, N. Y.
Office—60 East 42nd Street, New York
Fleming Co., Inc., Topeka, Kansas
July 27 filed 5,000 shares of 5% cumulative preferred
stock (par $100) and 15,000 shares of common-stock
(par $25), of which 3,000 shares of common stock are
to be offered for a period of 10 days to common stock¬
July 26 filed 120,000 shares of 6% cumulative convertible
preferred stock (par $15) and 73,598 shares of common
stock (par $1). Latter to be reserved for conversion of
6% cumulative convertible first preferred stock
redemption, with unconverted common
$5
par
to
be called for
shares to be sold to underwriters,
by amendment.
New York.
Price—To be supplied
Underwriter—F. Eberstadt & Co.. Inc.,
Proceeds—From
sale of preferred stock to¬
gether with other funds, will be used to repay $2,000,outstanding 4% notes due March 16, 1954, and to
holders, officers and employees and 2,000 sharesxrf pre¬
redeem 36,799 shares of outstanding preferred stock at
ferred and 6,000 shares are to be offered publicly to- £
$5.50 per share. Meeting—Stockholders will vote at an
gether with any of the unsubscribed 3,000 common
adjourned meeting Sept. 7 on the proposed financing
shares.
The underwriters have an option to
purchase
000
Offering—Not expected until after Labor Day.
the preferred at $100 per share and the common dtf $36
program.
Price—On exercise of rights, $36 per sjiare
common, and to public at not exceeding $103 per
share for the preferred and $37.50 per share fpr the
common stock. Underwriters—Beecroft, Cole & Centric.;
TThe Columbian Securities Corp.; Seltsam-Hanni & Co.,
Inc. and Estes & Co., all of Topeka, Kan. Proceeds—
For working capital.
v ;v:y'';
General Finance Corp., Chicago, III.
July 3 (letter of notification) 46,153 shares of common
stock (par $1), to be offered to employees, officers and
directors of company. Price—$6.50 per share.
Under¬
writer—None. Proceeds—To The First National Bank of
per
share.
for
.Food Machinery & Chemical Corp.
»
June 13 filed 100,000 shares of common stock (pai* $10)
tp be offered to employees. Price—To be based on mar¬
ket on New York Stock Exchange (about $34.50 per
share). Underwriter—None. Proceeds—For general cor¬
porate purposes. Statement effective June 29.
-
Fosgate Citrus Concentrate Cooperative
June 29 filed 453 shares of class A
common
(Fla.)
stock (par
$100); 5,706 shares of 5% class B preferred stock (par
$100), cumulative beginning three years from July 10,
1950; 8,000 shares of 4% revolving fund class C stock
(par $100); 2,000 shares of 4% revolving fund class C
stock (par $50); and 4,000 shares of 4% revolving fund
class C stock (par $25). Price—At par. Underwriters
—None.
Proceeds—To construct and equip frozen con¬
centrate plant
f
Fox
at Forest City, Fla.
(Peter)
Brewing Co., Chicago, III. July 24 (letter of notification) 5,000 shares of comn^on
stock (par $1.25). Price—$7.75 per share. Underwriter—
*
Chicago
as
Trustee for the Estate of Owen L. Copn. Of¬
fice—184 West Lake St, Chicago 1,
Goiconda
111.
Mines Ltd.,
Montreal, Canada
April 9 filed 750,000 shares of common stock.
Price—
At par ($1 per share).
Underwriter—George F. Breen,
New York.
Proceeds—For drilling expenses, repayment
of advances and working capital. Offering—Date not set.
Grand
Union Co., New York
Aug. 7 filed 64,000 shares of common stock (par $10)
to be issued pursuant to an "employees' restricted stock
option plan." Price —To be supplied by amendment.
Underwriter—None.
Proceeds—For general corporate
purposes.
Office—50 Church St., New York.
Hartford Special Machinery Corp.
July 24 (letter of notification) 5,000 shares of common
stock being offered for subscription by stockholders of
record July 23, on the basis of one new share for each
five shares held; right to expire on Aug. 28. Price—At
par ($20 per share). Underwriter—None. Proceeds—For
additional working capital. Office—287 Homsetead Av¬
enue, Hartford, Conn.
^
Kaman Aircraft Corp.,
Windsor Locks, Conn.
July 26 (letter of notification) 17,021 shares of class A
(non-voting common stock (no par), of which 171 shares
are to be offered
at $6 per share to four stockholders
who failed to receive notice of their right to subscribe
to
an
offering made in February, 1951; 15,742 shares to
to certain employees at $1 per share as part
be offered
of
an
employees'
bonus plan;
offered to certain employees at
and 1,108 shares to be
$7 per share in exchange
contingent money obligation to such employees
based upon past sources. Proceeds—For working capital.
for
a
Office—Bradley Field, Windsor Locks, Conn.
Linnton
Plywood Association, Portland, Ore.
filed 188 shares of non-voting
Price
—At par ($5,000 per share). Underwriter — None, but
John J. Oxley and J. A. Williams will solicit subscrip¬
tions. Proceeds—To improve plant site and acquire facil¬
ities and machinery.
(by amendment)
Aug. 1
common
stock to be offered to employee members.
Keever Starch Co.,
Columbus, Ohio
stock.
(letter of notification) 50,400 shares of common
Price — At par ($5 per share). Underwriter—
None.
Proceeds—To finance inventories and to purchase
Aug. 1
capital equipment.
Office—538 E. Town St., Columbus,
Ohio.
Los Angeles Drug Co. (Calif.)
July 23 filed $500,000 of 15-year 5% sinking fund debenutres dated Oct. 1, 1951 and due Oct. 1, 1966, and 40,000 shares of capital stock (no par), to be offered first
to present stockholders (debentures to be offered are
to be subject to prior issuance to shareholders in pay¬
ment of a dividend in aggregate amount of $300,000).
Price—Of debentures, at par (in denominations of $100
each) and of the stock, $10 per share. Underwriter—
None. Proceeds — To increase working capital and to
finance expanded merchandise inventory.
Loven Chemical of California
June 15
(letter of notification) 86,250 shares of capital
par
($1 per share).
UnderwriterFloyd A. Allen & Co., Los Angeles, Calif. Proceeds—For
working capital. Office—244 So. Pine St., Newhall, Calif.
stock.
Price—At
Lytton's, Henry C. Lytton & Co., Chicago, III.
July 24 (letter of notification) 3,000 shares of common
stock (par $1). Price—$6.87 per share.
Underwriter—
Straus & Blosser, Chicago, 111. Proceeds—To Martin S.
Goldring, a director, who is the selling stockholder.
Office—235 So. State St.. Chicago. 111.
McBee Co.,
Athens, Ohio
Aug. 3 (letter of notification) 2,500 shares of 5% first
preferred stock. Price—At par ($100 per share). Under¬
writer—Roy E. Hawk & Co., Athens, O. Proceeds—For
working capital.
Continued
on
page
36
36
The Commercial and Financial Chronicle
(628)
•
J
Continued from page
35
each $100
j
par)
preferred
stock (no
to be offered in units of one share of preferred
one share of common stock.
Price—$60 per unit.
Underwriter
—
working capital.
Proceeds —For
None.
Office—4383 Bandini Boulevard, Los
Angeles 23, Calif.
Corp. of California
May 18 (letter of notification) 4,881 shares of first pre¬
ferred stock.
Price—At par ($20 per share).
Under¬
writer—Guardian Securities Corp.
Proceeds—For gen¬
Mercantile Acceptance
eral corporate purposes.
^ Midwest Packaging Materials Co., St. Louis, Mo.
July 17 filed 10,880 shares of common stock (par $1)
issued to Edward D. Jones & Co. upon exercise of war¬
purchase stock at $5 per share, and then to be
publicly offered. Price—$6.50 per share. UnderwriterEdward D. Jones & Co., St. Louis, Mo. Proceeds—$50,000
rants to
proceeds from sale of warrants will be used to pur¬
chase 500 additional shares of The Midwest Wax Paper
of
Co.,
a
wholly-owned subsidiary, at $100 per share
corporate purposes.
and
the balance used for general
Miles
(8/23)
it Montana-Canadian Oil Corp.
(letter of notification) 82,900 shares of com¬
(par 10 cents). Price—$3 per share. Under¬
writer—S. B. Cantor Co., New York. Proceeds—To drill
and complete wells and for working capital. Office—811
Maritime Bldg., New Orleans, La.
Multnomah
Plywood Corp.,
Portland,
Ore.
(letter of notification) 76 shares of common
stock (par $2,500), of which 60 shares will be offered
in 20 units of three shares each to 20 individuals who
are
14
not stockholders, and 16
shares
are
to be offered to
present stockholders on basis of one share for each two
ahares owned. Price—Per unit, $12,500: and per share,
$2,500 to present stockholders. Underwriter—None. Pro¬
ceeds—To acquire timber and a peeler plant operation.
Office—1500 S. W. Harbor Drive, Portland 1, Ore.
Mutual Telephone
Co., Honolulu, Hawaii
July 27 filed 150,000 shares of common stock (no par)
to be offered for subscription pro rata by common stock¬
holders. Price—To be supplied by amendment. Under¬
writer—Kidder, Peabody & Co., New York. Proceeds—
To pay outstanding bills and for construction program.
Offering—Expected late September.
National Distillers Products Corp.
(8/21)
July 31 filed 500,000 shares of cumulative preferred
Stock, series of 1951 (par $100—convertible prior to
Sept. 1, 1961). Price—To be supplied by amendment.
Underwriters—Glore, Forgan & Co. and Harriman Rip¬
ley & Co., Inc., both of New York. Proceeds—To repay
bank loans and for general corporate purposes.
•fc New England Gas & Electric Ass'n (9/18)
Aug. 6 filed $6,115,000 of 20-year sinking fund collateral
trust bonds, series C, due 1971.
Underwriter—To be
determined
by
competitive bidding.
Probable bidders:
Halsey, Stuart & Co. Inc.; The First Boston Corp.; White,
Proceeds—To purchase additional common
Weld & Co.
stocks of five subsidiaries.
11:30
a.m.
(EDT)
on
Sept.
Bids—To be
18
at
10
received up to
Temple St., Cam¬
bridge, Mass.
Newman Associates, Inc. (name to be changed
to Sheeld, Inc.), Dallas, Tex.
July 30 (letter of notification) 10,000 shares of preferred
stock (no par) and 50,000 shares of common stock (par
two cents) to be offered in units of one
preferred and
,
live
common
shares.
This includes 33,000 common shares
lor account
of Hal C. Newman, President of the com¬
Price—$10.10 per unit. Underwriter—Southwest¬
ern Securities Co.,
Dallas, Tex. Proceeds—To purchase
assets of Sterling Industries, Inc., to retire bank loans
and
pay
accounts payable, and for working capital.
Office—1400 Marilla St., Dallas, Tex.
pany.
North American Acceptance Corp.
£farch 20 (letter of notification) 15,000 shares of 60-cent
cumulative convertible preferred stock
(par $5). Price
-—$10 per share. Underwriter—Michael Investment Co.,
V
2ac., Providence, R. I. Proceeds—For working capital.
'Offering—Postponed temporarily.
.
Northwest Pldstics, Inca, St. Paul, Minn.
Aug. 3
(letter of notification) $100,000 of 6% 15-year
convertible sinking fund debentures and
12,000 shares
of common stock (par $2.50). Price—Of
debentures, at
par; and of stock, $8.75 per share. Underwriters—M. H.
Bishop & Co., Minneapolis, Minn., and Irving J. Rice &
Co., St. Paul, Minn. Proceeds—To retire bank loans and
mortgage debt and for working capital. Office—65 Plato
Ave., St. Paul, Minn.
(par $100).
by competitive bidding
bidders:^Morgan Stanley & Co.;
Lehman Bro¬
kers and Bear, Stearns & Co. (jointly); W. C. Langley
A:ft 9°J vGlore, Forgan & Co. and White, Weld & Co.
Uointly);TJie. First Boston Corp. Proceeds -- For con¬
struction program.
Bids—Indefinitely postponed. Were
to have been submitted up to 11:30 a.m.
(EDT)
Old Colony Finance
Corp., Mt. Rainier,
June 1
(letter of notification) $250,000 of
ordinated
debentures
with
stock
purchase
attached,
chase
one
on
May 2.
Md.
capital.
Offering—Abandoned
6%
..v
on
Pan American
Milling Co., Las Vegas, Nev.
200,000 shares of common stock. Price—At
Par ($1 per share).
Underwriter—None. Proceeds—To
purchase machinery and equipment, to construct a mill
Jan. 24 filed
in
Mexico
and
for
Aug. 28.
sub¬
warrants
:
:-m,
;
Southwestern Associated Telephone Co.
general
corporate purposes. State¬
ment effective June 26 through lapse of time; amend¬
'
r
17,500 shares of $5.50 cumulative pre¬
par). Price—To be supplied by Amend¬
ment.
Underwriters—Paine, Webber, Jackson & Curtis
and Stone & Webster
Securities Corp., both of New
June
filed
15,
ferred stock (no
ment necessary.
Peabody Coal Co.
.
March
26
filed
160,000 shares of 5%%
prior preferred
Price—To be supplied by amendment.
Underwriter—A. C. Allyn & Co., Inc. Chicago, 111. Pro¬
ceeds—For construction program. Offering—Indefinitely
stock
York, and Rauscher, Pierce & Co., Inc., Dallas, Texas.
Proceeds—To retire $1,500,000 of bank loans and the
(par $25).
11
(letter of notification)
$300,000 of 4V2% con¬
(each $100 principal amount
into three shares of common stock).
Price
—At par.
Underwriter—None.
Proceeds—For working
capital.
Office—69th Street Terminal, Upper Darby,
Pennsylvania.
Terminal Annex, Los
Pittsburgh Plate Glass Co.
Office—2807 Central Avenue, Birmingham, Ala.
capital.
Spencer Chemical Co., Kansas City, Mo. (8/27)]
Aug. 3 filed 125,000 shares of cumulative convertible
second preferred stock (par $50) to be offered to com¬
^
the New York Stock Ex¬
change at time options are granted.
Proceeds—For working capital.
f
Angeles.
Specialized Products Corp., Birmingham, Ala.
Aug. 2 (letter of notification) 5,000 shares of capital
stock. Price—$10 per share. Underwriter—None. If issue
is to be underwritten later, names will be supplied by
amendment.
Proceeds—For
expansion and operating
June 27 filed 450,000 shares of common stock (par $10)
to be offered to certain employees of the
company and
its subsidiaries under a stock option plan.
Price—At
on
J
Spartan Grocers, Inc., Los Angeles, Calif.
Aug. 3 (letter of notification) 15,000 shares of common
stock. Price—$10 per share. Underwriter—None. Pro¬
ceeds—For addition to warehouse. Address—Box 3549,
vertible debentures of 1967
of the market price
—
Postponed.
convertible
85%
general corporate funds. Offering
added to
balance
Philadelphia Suburban Transportation Co.
June
Underwriter—None.
in
stockholders
mon
ratio
of
one
share
of
preferred
for each eight common shares held about Aug. 27, with
Polymer Industries, Inc., Astoria, N. Y.
July 30 (letter of notification) 10,000 shares of 6% cu¬
rights expiring about Sept. 11.
Price—To be supplied
mulative preferred stock (par $5) and 20,000 shares of / by amendment.
Underwriters — Morgan Stanley & Co.
common stock (par one cent)
and Glore, Forgan & Co., New York.
to be offered in units of
Proceeds—From
one
share of preferred and two shares of common to
sale of stock, together with $5,100,000 from institutional
preferred stockholders of record July 27 on the basis
investors, will be used to pay part of cost of construc¬
of two units for each five shares held; rights will expire
tion of new chemical works.
,•/.■•:
a■;>'
on Sept. 1.
Price—$5.02 per unit. Underwriter—None.
Spiegel, Inc., Chicago, III.
Proceeds—For expansion program and working capital.
June 21 filed 73,250 shares of common stock (par $2)
•
Pratt-Hewitt Oil Corp., Corpus Christi, Tex.
July 23 (letter of notification) 13,600 shares of common
stock (par $1).
Price—62 cents per share. Underwriter
—Merrill
Lynch, Pierce, Fenner & Beane, Corpus
Christi, Tex.
Proceeds—To John D. Hawn, a director,
who is the selling stockholder.
Office—520 Lawrence
Street, Corpus Christi, Tex.
'
*
.
to be issuable upon
exercise of stock options granted to
key executives of the company under plan
adopted by stockholders on April 18. Price—$11.70 per
officers and
;
Underwriter—None.
share.
Proceeds—To reduce bank
borrowings and for working capital.
Statement effective
July 23. ;
State Loan & Finance Corp. (8/21)
filed 73,250 shares of common stock (par $2),
to be issuable upon exercise of stock options granted to
officers and key executives of the company under plan
adopted by stockholders on April 18. Price—$11.70 per
it
June 21
Reading Tube Corp., Long Island City
June 5 filed $1,859,256 of 20-year 6% sinking fund de¬
bentures due July 1, 1971, and 66,402 shares of class B
stock (par 10 cents) being offered in exchange for 265,608
shares of outstanding class A cumulative and participat¬
ing stock (par $6.25) on the basis of $7 principal amount
of debentures and one-fourth of
a
share of class B stock
for each class A share held; offer extended to
Sept. 5.
York.
expire on
Dealer-Manager—Aetna Securities Corp., New
Statement effective June 29.
Underwriter—None.
share.
Realty Co., Denver, Colo.
7 (letter-of notification)
2,000 shares of capital
Price—$6 per share. Underwriters
—Ralph S. Young, Colorado Springs, Colo; J. A. Hogle
& Co., Salt Lake City, Utah; and Garrett-Bromfield &
Co., Denver, Colo. Proceeds—For working capital. Office
—937 U. S. National Bank Bldg., Denver, Colo.
June
stock (par 25 cents).
Riverside
Stadium, Inc., Riverside, Mo.
(letter of notification) $250,000 of 15-year 5%
notes and 25,000 shares of common stock
(par $1) to be offered in units of one $100 note and 10
July 12
debenture
shares of
stock.
Price—$100
unit.
per
Underwriter—
Proceeds—To
Proceeds—To
borrowings and for working capital.
July 23.
bank
reduce
Statement effective!
State Loan & Finance Corp., Washington, D. C.
July 23 filed 160,000 shares of 6% convertible preferred
stock, series A
Price — To be supplied by,
Johnston, Lemon & Co.,
Proceeds—For general corporate pur¬
(par $25).
Underwriter
amendment.
Washington, D. C.
—
poses.
Texas
Southeastern
Gas
Co., Bellville, Tex.
19,434 shares of common
stock to be offered to
common
stockholders through
transferable warrants.
Price
At par ($5 per share).
Underwriter—None. Proceeds—For working capital.
May 16 (letter of notification)
—
Trad Television Corp.
Aug. 7 (letter of notification) 2,000,000 shares of common
stock
being offered for subscription by common stock¬
ratio of eight shares for each
holders of record Aug. 9 in
shares
nine
Temporarily
oversubscription privilege;
Price —10 cents per share.
Underwriter
None.
Proceeds
For working
capital,
etc.
Office—1001 First Avenue, Asbury Park, N. J.
Associates, Inc., Waltham, Mass.
(letter of notification) 60,000 shares of class A
common stock. Price—$5,per share. Underwriter—None.
Proceeds—For purchase and/or rental of operating facil¬
July 31 filed 1,000,000 shares of common stock (par 10
cents). Price—$1 per share. Underwriter—None. Pro¬
Wahler, White & Co., Kansas City. Mo.
outstanding obligations.
Offering
retire
postponed.
>
—
i
.
rights
ities such
★
Sears, Roebuck & Co., Chicago, III.
July 16 filed 500,000 shares of capital stock (no par) to
be offered to employees under terms of an Employees
Stock Purchase Plan. Price—To be equal to 85% of the
price first quoted on the New York Stock Exchange on
July 16 filed 25,000 new memberships in the Savings and
Profit Sharing Pension Fund of Sears, Roebuck & Co.
Employees and not more than 750,000 shares of capital
stock (no par) to be purchased by the Fund for mem¬
bers during the years. None of these shares will be pur¬
chased from the company. Statement effective Aug. 4.
Skeeld, Inc., Dallas, Tex.
Associates, Inc. above.
See Newman
with
Aug.
an
27.
—
United Canadian Oil Corp.,
ceeds—For
electronic test
equipment, machine tools, and
working capital to enable the
taking and completing of prime government and sub-con¬
tracts pertaining to guided missiles, electronics, and re¬
lated fields. Office—135 Bacon St., Waltham, Mass.
as
office equipment and for
held,
expire
—
Sanders
Aug. 2
Washington, D. C.
exploration and drilling activities.
United States Gasket Co.
(letter of notification) $100,000 to
convertible preferred stock, or
July 25
4%
loan
To
6%
or
of
that
erect
—602
Van
June
new
North
Underwriter—None.
amount.
filed
mortgage
Proceeds—
plants, and purchase equipment.
Street, Camden, N. J.
Office
10th
Lake Uranium
7
$200,000 of
a
100,000
Mining Co., Van Dyke, Mich.
shares of common stock. Price
($1 per share). Underwriter—Titus Miller &
Co., Detroit, Mich.
Proceeds —For exploration and
drilling of mining claims.
Office—23660 Van Dyke
—At par
Avenue, Van Dyke, Mich. Offering—Expected soon.
Viking Plywood & Lumber Corp., Seattle, Wash.
July 9 (letter of notification) 37,500 shares of common
stock (no par), to be sold in minimum units of 125 shares
to present officers, directors and stockholders.
Price—
$20 per share. Underwriter—None. Proceeds—To per¬
acquisition of 50% of capital stock of Snellstrom
Lumber Co., Eugene, Ore/ Office—14il Fourth Avenue
mit
Building, Seattle, Wash.
Snoose
The latter will entitle holders thereof to
pur¬
share of common stock at $4 per share* for
working
working capital.
^ Southern California Edison Co. (8/28)
July 30 filed $30,000,000 first and refunding mortgage
bonds, series D, due 1976. Underwriters-^To be deter¬
mined by competitive bidding. Probable bidders :f Halsey,
Stuart & Co. Inc.; Blyth & Co., Inc.; The First Boston
Corp. and Harris, Hall & Co., Inc. (jointly) i Kuhn,
Loeb & Co.
Proceeds—For construction program. Bids
—Expected to be received up to 8:30 a.m.} (PDT) on
Aug. 7.
the date the contract for the sale is issued. Underwriter
—None.
Proceeds—For general corporate purposes.
Ohio Edison Co.
March 30 filed 150,000 shares of
pfd. stock
Underwriters—To be determined
Probable
and
common
offered to common stockholders
of record Sept. 21 at rate of one share for each 12 shares
held. Price—$14.50 per share. Underwriter—None. Pro¬
ceeds—For
,
Optionee—Robert Irwin Martin of Toronto; Proceeds—
For commissions, exploration and development expenses,
stock (par $12.50) to be
31
stock
June
Avenue, Mt. Rainier, Md.
^ Oneida, Ltd., Oneida, N. Y.
Aug. 2 (letter of notification) 20,587% shares of
Management, Inc., Wallace, Idaho
—
July
Rhode Island
)
■
.
South State Uranium Minos Ltd. < Canada),
par (in de- |
Underwriter
April 9 filed by amendment 384,000 shares of capital
Office—3219
stock.
Price —At par ($1 per share).
Underwriter-
postponed.
July 24 (letter of notification) 58,000 shares of common
capital stock.
Price—60 cents per share.
Underwriter
Louis Payne, Spokane, Wash.
Proceeds —To meet
property payments, purchase contracts and other mining
expenses.
Offices—507 Bank Street, Wallace, Idaho,
and 612 Chronicle Building, Spokane, Wdsh.
mon
Price—At
of debentures owned.
nominations of $100> $500 and $1,000 each).
Proceeds—For working capital.
—None.
May fair Markets, Los Angeles, Calif.
May 24 (letter of notification) 5,000 shares of
Stock (par $50) and 5,000 shares of common
and
Thursday, August 16, 1951
.
Mining Co., Hailey, Idaho
July 19 (letter of notification) 1,000,000 shares of com¬
mon stock.
Price-r-At par (25 cents per share). Under¬
writer—E. W. McRoberts & Co., Twin Falls, Ida. Proceeds
—Fordevelopment of mine,
.
Weisfield's, Inc., Seattle, Wash.
May 21 (letter of notification) 5,244 shares of capital
stock. Price—$53 per share. Underwriter—None. Pro¬
ceeds—For
working capital,
Office—Ranke Bldg., 1511
Fifth Avenue, Seattle 1, Wash.
■■
.
.
■
•
•
-
'
■
Volume 174
Number 5038
.
.
The Commercial and Financial Chronicle
.
(629)
Welex Jet Services, Inc., Fort Worth, Texas
(letter of notification) 9,573 shares of common
stock (no par) being offered to stockholders of record
July 10 at rate of 6V2 shares for each 100 shares held,
Central Telephone Co.,
Chicago, III.
Aug. 14 company announced it'plans to offer early in
September to holders of its common stock (other than
with
of
July 16
oversubscription privilege. Price—$16
an
share.
per
Underwriter—None. Proceeds — To reduce bank
Office—3909r Hemphill St., Fort Worth, Tex.
jWestates
loan.
Inc., Las Vegas, Nev.
July 24 (letter of notification) 300,000 shares of common
stock; Price—At par ($1 per share). Underwriter—None.
Proceeds—Fo;r development of tungsten mineral property
in Arizona.
•
Office—504 So. 3rd
St., Las Vegas, Nev.
July
Telephone Co., Franklin, N. C.
notification) 2,109 shares of capital
6
(letter of
(par $50^ being
rate of
one
new
first offered to stockholders at
share for each two shares held
on
16, with rights expiring on Aug. 16; unsubscribed shares
be publicly offered. Price—$50 per share to stock¬
holders and $60 per share to public. Underwriter—None.
Proceeds—For working capital.
Price—$20 per share.
Underwriter—None.
Proceeds—
financing expansion program.
Office—1108 Lavaca
Street, Austin, Tex.
For
Wilson Brothers, Chicago, III.
(8/28)
Aug. 3 filed $2,200,000 of 5% sinking fund debentures
due Aug. 1, 1966, with non-detachable common share
purchase warrants for the purchase of 154,000 shares of
stock.
common
Price—To
be
supplied
by amendment.
Underwriter—Blair, Rollins & Co., Inc., New York.
Proceeds—To pay off outstanding indebtedness and for
other corporate purposes.
'
\ V
^
:
ic Workers Finance Co. of North Bergen, N. J.
July 26 (letter of notification) $150,000 of 6% cumula¬
tive deferred debentures due in
5, 10 or 20 years.
—At par in units of $100
Price
Underwriter—None.
each).
Proceeds—To make loans.
North
•
Bergen, N'. J.
Office—770 Bergenline Ave.,
To be sold privately.
Prospective Offerings
(9/11-12)
reported that early registration of about
10-year first mortgage bonds is expected.
Aug. 7 it
Probable
was
debentures.-
Proceeds—To redeem outstanding 4*A%
.
May 27, Charles Sawyer, Secretary of Commerce, pro¬
posed the public sale to the highest bidder of the stock
of this company now held
by the Department of Com¬
The proceeds would be placed in escrow until
Courts decide whether the stock
rightfully belongs
to the Government or to the Dollar interests.
'
merce.
the
July 16 it
and
sale
was
(10/9)
that company plans
announced
issuance
of
$8,000,000 additional first mortgage bonds.
Underwriters—To be determined by competitive bidding.
Probable bidders: Halsey, Stuart & Co. Inc.;* Lehman
Brothers and Stone & Webster Securities
Corp. (jointly);
Equitable Securities Corp. and Central Republic Co.
(jointly); Union Securities Corp.; The First Boston Corp.;
White, Weld & Co. Proceeds—For construction program,
estimated to cost about $20,000,000 in 1951.
ed to be opened about Oct. 9.
Bids—Expect¬
,
.
Arkansas Western Gas Co.
10 stockholders approved issuance of $1,350,000
first mortgage bonds and increased authorized common
from 300,000
to
500,000 shares (of which 289,706
shares are outstanding). Bonds will
probably be sold
privately, and proceeds used to redeem $420,000 of 3%%
debentures and retire $197,500 bank loans, with the bal¬
for construction program.
ance
No
common
stock financ¬
ing is contemplated at present.
Associated Telephone Co., Ltd.
July 3 it
sale
was
later
gage bonds.
petitive
(Calif.)
announced that tentative
plans call for the
of $8,000,000 additional first mort¬
Underwriter
To be determined by com¬
this
year
—
bidding.
Probable
bidders
for
bonds:
Stuart & Co.
Halsey,
Inc.; Paine, Webber, Jackson & Curtis and
Stone & Webster Securities
Corp. (jointly); Kuhn, Loeb
& Co. and Salomon Bros. &
Hutzler (jointly); White,
Weld & Co., Kidder,
Peabody & Co. and Shuman, Agnew
Co.
(jointly); Harris, Hall & Co., Inc. and Equitable
Securities Corp. (jointly). Proceeds — For
construction
&
program.
•
Atlantic Oil Co., Ltd.
Aug. 7 it
was
(Canada)
reported company expects, to file
a
regis¬
able
Underwriter—Reynolds & Co., New York.
Beaunit Mills, Inc.
June 26 stockholders approved issuance
and sale of 100,000 shares of $5 cumulative
preferred stock (no par).
Underwriters—Probably White, Weld & Co. and Kidder,
Peabody & Co. Proceeds—From sale of stock, together
with $15,000,000 from bank loans
and $3,000,000 from
sources,
to be used
to
finance
construction
of
a
rayon tire yarn plant at Coosa
ing capital.
Pines, Ala., and for work¬
Offering—May be made privately.
Carolina Natural Gas
Corp., Charlotte, N. C.
a fourth amended
application was filed with the
SEC for authority to build a natural
Feb. 20
gas pipeline system
to serve certain areas in North and
South Carolina. Esti¬
mated cost of the
proposed facilities is $3,595,295, to be
financed
by the sale of first mortgage bonds and the
issuance of junior securities. Underwriters
may include
R. S. Dickson & Co.,
Charlotte, N. C.
Vermont
___
Public
announced that
was
before
the
end
of
1
Secur Now in
Service
the
1952
Corp.
company
additional
expects
to
equity financing.
It' is estimated
that about $3,400,000 will be
required to take care of
additional construction expenditures to the end of next
.
will
be
East Tennessee Natural Gas
Co.
an amended application in
con¬
proposal to extend its natural gas trans¬
mission system to several Tennessee
communities and
industrise at an estimated cost of
nection with
received
to
up
(9/12)
noon
for the purchase by the
company of
ment trust certificates to mature
15 years. Probable bidders:
&
000 to be financed
gage
•
Hutzler.
Chicago District Pipeline Co.
May 22 it was announced that this company (a sub¬
sidiary of Peoples Gas Light & Coke Co.) may find it
necessary to construct a 30-inch pipeline from
Volo,
111., to near Mt. Prospect, 111., at a cost estimated at
approximately $1,650,000.
The amount and character
of the financing are not now known.
Bond financing in
March, 1950, was placed privately.
—
;
.
2
it
from
;
as an
$70,000,000 of first mortgage bonds,
due 1981, of which about
$65,000,000 will be sold ini¬
tially. Price—Not less than par. Underwriter—To be
of
by competitive bidding.
Probable bidders:
Halsey, Stuart & Co. Inc.; Morgan Stanley & Co.; Lee
Higginsom Corp.; Harris, Hall & Co. (Inc.); Drexel &
Co.; Kuhn, Loeb & Co. and Salomon Bros. & Hutzler
(jointly); Harriman Ripley & Co., Inc.; First Boston
Corp.; Lehman Brothers; Paine, Webber, Jackson &
Curtis; Kidder, Peabody & Co.
Proceeds—To refund
$49,988,000 of 4% non-callable consolidated first mort¬
and
May 22 Charles Y. Freeman, Chairman, announced that
company's scheduled construction program for the
the
1951-54
period calls for the expenditure of about $450,000,000, of which it is estimated that $200,000,000 will
the
end
of
company's properties.
Sept. 1.
:■
that additional capital of about
or
debentures:
Corp., Greensboro, N. C.
reported that preparations are going for¬
marketing of from 400,000 to 500,000 shares
of outstanding common stock.
Underwriter — May be
Morgan Stanley & Co., New York. Proceeds—To go to
selling stockholders.
was
by competitive bidding. Probable bidders: Halsey, Stu¬
Inc.; Morgan Stanley & Co.; The First Boston
Corp.; Merrill Lynch, Pierce, Fenner & Beane and White,
Weld
&
Co. (jointly).
Proceeds — To redeem a like
amount of Westchester
gage bonds due 1967.
Lighting Co. 3^% general mort¬
Offering—Postponed.
•
Continental Can Co., Inc.
Aug. 7 it was reported that the company may offer a
combination of securities later this year. Probable Un¬
derwriter—Goldman, Sachs & Co., New York.
Delaware River Development Corp. (N. J.)
20 FPC decided to issue a
one-year preliminary
permit to the corporation for investigation of the pro¬
posed development of a hydroelectric project on the
Delaware River in New Jersey, Pennsylvania and New
York, estimated to cost $47,000,000. Early last year, it was
announced that the proposed project would be financed
through the issuance of $28,200,000 of bonds, $14,100,000
of preferred
stock, $4,700,000 of convertible common
stock and 100,000 shares of no par value common stock.
Denver
&
Rio
Grande Western
RR.
April
12, Wilson McCarthy, President, stated that due
to prevailing market
conditions, the company has post¬
poned to an undetermined date the taking of bids for
the purchase of $40,000,000 first
mortgage bonds to be
dated May 1, 1951, and to mature on
May 1, 1981.
derwriters—To be determined by competitive
Un¬
bidding.
Probable bidders: Halsey, Stuart & Co.
Inc.; Morgan
Stanley & Co.; Kuhn, Loeb & Co. and Bear, Stearns
& Co.
(jointly).
Proceeds — Together with treasury
funds, to redeem on June 1, 1951, $35,062,200 oustanding
first mortgage 3% -4% bonds, series
A, and $8,666,900 of
Denver & Salt Lake income
mortgage 3%-4% bonds,
both due Jan. 1, 1993. vr
and
on
after
•
27
W.
V.
before the end of the
year, of 682,454 addi¬
tional shares of capital stock to
its stockholders. Under¬
writer—None. Proceeds—To
repay short-term loans and
for new construction.
Cone Mills
art & Co.
,
company
Hal¬
(in addition to $40,000,000 series G bonds filed with
the SEC on March 30). Underwriters—To be determined
Offering—Expected
Telephone Co.
Kahler, President, announced that this
(approximately 99.31% owned by American
Telephone & Telegraph Co.) plans issuance and
sale,
sometime
June
Stuart & Co. Inc.; The First Boston Corp.; Glore,
Forgan & Co.; Morgan Stanley & Co.
1981
;
Illinois Bell
sey,
Consolidated Edison Co. of New York, Inc.
March 23 company applied to New York P. S. Commis¬
sion for authority to issue and sell $25,000,000 of first
and refunding mortgage bonds, series H, due
May 1,
>
Power Co.
ceeds will be used for additions and
improvements to the
1950.
$250,000,000
will be required through 1954.
Neither the timing nor
the nature of this new financing have yet been deter¬
Aug. 7 it
yv'-V
.
was
July 23 company applied to FPC for authority to issue
$15,000,000 of additional first mortgage bonds, due 1981.
Will probably be
placed privately. If competitive, prob¬
able bidders
may include -Halsey-, Stuart & Co.
Inc.;
Blyth & Co., Inc., Lazard Freres and The First Boston
Corp. (jointly); Equitable Securities
Corp.; Kidder, Pea¬
body & Co.; Salomon Bros. & Hutzler and Union Securi¬
ties Corp.
(jointly); Harriman Ripley & Co., Inc. Pro¬
.
Probable bidders for bonds
-
reported that the company plans to issue
$4,000,000 of cumulative convertible preferred
Underwriter—McDonald & Co., Cleveland," O.
Idaho
at
it,
$2)
■>.
Offering—Expected about Sept. 20.
Commonwealth Edison Co.
mined.
stock (par
sell
stock.
18 it was
means
Aug. 22.
July 27 it
reported that the holdings of the Union
Corp. group of stock of Colorado Interstate
(531,250 shares) will probably be sold publicly in August
or September.
/
V-""*'■ "J"~
This
common
Proceeds—To finance expansion
program.
Harshaw Chemical Co. (9/20)
Colorado Interstate Gas Co.
resources
entirety, of 28,927 shares of
this
Batteries, Inc., St. Paul, Minn.
Aug. 7 Albert H. Daggett, President, reported the com¬
pany is considering sale of 65,000 shares of convertible
preferred s.tock (par $50), with an interest rate of
around
4%%.
Price—Expected at $52.50 per share.
Underwriter—Probably Glore, Forgan & Co., New York.
improvements, etc.
cash
& Co., New York.
Gould-National
July 1, 1952, and to redeem $13,747,000
first and refunding mortgage ^Ya%
bonds, series D, due
Sept. 1, 1962.
The remainder will go towards property
provided out of
Underwriter—White, Weld
company.
Bids will be received by the RFC at
208 So. La Salle
St., Chicago 4, 111., up to 11 a.m. (CDT)
on
determined
be
tional
Foote Bros. Gear & Machine
Corp. (8/22)
Aug. 8 the RFC invited bids for the purchase from
approximately
June
200,000 to 300,000 shares and the common stock
3,800,000 to 5,000,00 shares; also to authorize an in¬
in the aggregate
principal amount of bonds issu¬
able under the company's indenture of
mortgage, dated
June 1, 1946, from $157,00,000 to
$300,000,000. Tradi¬
crease
company expects to be in the
market late this year or early in 1952 with a new issue
of
Paso Natural Gas Co.
from
reported
was
El
Aug. 10, it was announced that stockholders will vote
Sept. 18 on increasing the first preferred stock from
100,000 to 300,000 shares, the second preferred stock
Chicago & Western Indiana RR.
June
a
approximately $5,200,by the issuance and sale of first mort¬
pipe line bonds. Latter may be placed
privately.
Traditional underwriter:
White, Weld & Co., New York.
(EDT) on Sept. 12
$6,300,000 of equip¬
semi-annually over
Halsey, Stuart & Co. Inc.;
Bros.
Proceeds—To be applied toward!
July 17 company filed
.
Chesapeake & Ohio Ry.
Bids
(jointly).
1951 construction
program.
including
year.
& Curtis
son
permanent
June
tration statement with the SEC late this month
covering
approximately 1,150,000 shares of common stock. Prob¬
other
compensated.
ward for the
.
July
stock
be
Registration
Securities
American President Lines, Ltd.
-Arkansas Power & Light Co.
1 it
obtain
Underwriter—Paine, Webber, Jackson & Cur¬
tis, New York.
additional 26,000 shares
$10.25 or $10.50 per
an
Price—About
gage bonds due
American Box Board Co.
$5,000,000
...
common
share for each two shares held.
one
will
Central
Salomon
by present
stockholders at rate of
★ Derby Gas & Electric Corp.
July 16 corporation received SEC authority to issue and
sell $900,000 of debentures to
mature July 1, 1957 (to
be placed privately with an
institution) but reserved
jurisdiction over the proposed issuance of
approximate¬
ly 12,500 additional shares of common stock
(latter to be
offered to public pursuant to a
negotiated transaction).
To be selected
through competitive negotiation. Prob¬
able bidders: Allen &
Co.; Union Securities Corp.; Smith
Ramsay & Co.; Hincks Bros, and Paine,
Webber, Jack¬
Underwriter—None, but participating dealers in
Secur Now in
Aug.
Gas Co.)
stock.
common
share.
July
may
Western Reserve Life Insurance Co.
June 12 (letter of notification) 10,000 shares of
stock (par $10) to be offered for subscription
Central Electric &
financing,
Western Carolina
stock
•
securities
Explorations,
37
•
International Refineries, Inc.,
Minneapolis, Minn.
Aug. 14, it was announced company will finance the
con¬
struction of
$7,000,000 oil refinery near the cities of
and Superior, Wis., by the public 'sale
of securities.
Underwriters
Eastman, Dillon & Co.,
New York, and First Southwest
Co., Dallas, Texas.
a
Duluth,Minn.,
v
—
Jetter & Scheerer
Products, Inc., N. Y.
will be received at the Office
of Alien
(8/29)1
Property,
Bids
Department of Commerce, 120 Broadway, New York
5,
N. Y., up to 11 a.m.
(EDT) on Aug. 29 for the purchase
from The Attorney General of the
United States of 200
shares of common stock
(par $100), which constitutes
100%
of the issued and
outstanding capital stock.
Kansas City Power &
Light Co.
June 12, Harry B.
Munsell, President, announced
pany hopes to issue and sell within the next two
com¬
years
$12,000,000 of bonds, $10,000,000 of additional preferred
stock
nance
and
its
$8,COO,000 of additional
construction
program
common
for
stock
1951-1952.
to
fi¬
Stock¬
holders
voted July
11 to increase the authorized
preferred stock from 200,000 to 350,000 shares and the
indebtedness by $12,000,000.
Probable bid¬
ders for preferred stock:
Glore, Forgan & Co. and W.
authorized
X. Langley & Co.
(jointly); Smith, Barney &
First Boston Corp.; White Weld &
and Central Republic Co.
Co.; The
Co., Shields & Co.
(jointly); Harriman Ripley &
Co., Inc.; Salomon Bros. :& Hutzler and Merrill Lynch,
Pierce, Fenner & Beane (jointly); Union Securities
Corp. and Stern Bros. & Co. (jointly). Probable bidders
ior common stock; Lehman
Brothers; Glore, Forgan &
"Co.; Harriman Ripley
Co., Inc.
Probable bidders for
♦bonds:
Halsey, Stuart & Co. Inc.; Blyth & Co., Inc.;
White, Weld & Co.; Shields & Co. and Central Republic
Co. (jointly); Glore, Forgan & Co.;
Smith, Barney & Co.;
Kuhn, Loeb & Co.; Union Securities Corp. and Salomon
Bros. & Hutzler (jointly); Lehman Brothers and
Bear,
Stearns & Co. (jointly); The First Boston Corp.; Equit¬
able Securities Corp.; Harriman Ripley & Co., Inc. *
Kansas
Gas & Electric Co.
May 24
Murray
nounced
that
gram
the
F. Gill, Chairman of the board,
company's present construction
an¬
pro¬
calls for expenditures of more than $8,000,000 in
Continued
on
page
38
38
The Commercial and Financial Chronicle
(63CT)
Continued, from page
1951.
Co.;
37
To finance part of the
expansion program, com¬
sell $5,000,000 of first mortgage bonds. Under¬
writers—To
be
determined
by competitive bidding.
Probable bidders:
Halsey, Stuart & Co. Inc.; Union
Securities Corp.; Merrill Lynch, Pierce, Fenner & Beane
and Kidder, Peabody & Co. (jointly). There is a pos¬
sibility that company may also decide to refund its
outstanding $16,000,000 first mortgage 3%% bonds due
1970
(held by a group of insurance companies) and
$5,000,000 first mortgage 3y8% bonds due 1978.
pany may
Dallas, Texas
July 18, Barton R. McClendon, Chairman, announced
company expects in a few weeks to raise about $3,000,000,
probably through the sale of additional common stock.
Liberty
done
System,
Broadcasting
It has not been decided
privately
or
whether the financing will be
publicly.
Long Island Lighting Co.
was reported that the company's next
June 25 it
^
May 24 it was announced stockholders wiH vote Oct. 23
on a proposal to increase authorized common stock by
500,000 shares to 2,500,000 shares in order to provide for
a probable offering of additional stock to common stock¬
holders. Probable underwriter: Goldman, Sachs & Co.,
New York. Proceeds will be added to working capital.
Merck & Co., Inc.
July 26, George W. Merck, Chairman, announced
stock¬
holders on Sept. 10 will vote on approving issuance and
sale through rights to common stockholders of an issue
of approximately $25,000,000 of new convertible second
preferred stock. Price—To be supplied later. Under¬
Goldman, Sachs & Co. and Lehman Brothers,
both of New York. Proceeds — For capital investments
Pierce,
Fenner
&
Beane;
Seaboard Air Line RR.
Union
and
due Jan.
1, 2016; 9,543 shares of 5% preferred stock/se¬
(par $100); and 102,273 shares of common stock
(no par). Bids will be received by the RFC on Aug, 21
ries A
at 143 Liberty St., New York 6, N.
Y.? or 811 Vernjont
Ave., N. W., Washington, D. C. Probable bidders may. in¬
clude: Hornblower & Weeks,
White, Weld & Co., Merrill
Lynchr, Pierce, Fenner & Beane and Stein Bros. &
Boyce (jointly); Bear, Stearns & Co.
,V<
.■■■/';,V.
•
Pennsylvania Water & Power Co.
July 25, stockholders approved issuance of 78,507 shares
of cumulative preferred stock (par $100). Proceeds will
be used for expansion program.
,
.
.
;
South Georgia Natural Gas Co., Atlanta, Ga#
May 24 the FPC dismissed the application of company
to construct 527 miles of natural gas pipe line to
supply
markets in Georgia and Florida, the estimated cost of
>
Aug. 7, it was reported company may issue and sell
$8,000,000 to $10,000,000 of first mortgage bonds. Prob¬
able bidders may include: Halsey, Stuart & Co. Inc.;
Lehman Brothers; White, Weld & Co. Proceeds will be
used for expansion program.
Financing not considered
which
capital.
Missouri-Kansas-Texas RR.
(8/21)
Bids will be received by the company at
St. Louis, Mo.,
up to noon (CDST) on Aug. 21 for the purchase from it
of $1,500,000 of equipment trust certificates, second series
1951, to be dated Sept. 1, 1951 and to mature in 30
equal semi-annual instalments. , Probable bidders: Hal¬
sey, Stuart & Co. Inc.; Salomon Bros. & Hutzler.
was reported that company may do some per¬
financing "when market conditions permit."
Earlier this year arrangements were made with eight
banks for borrowing up to $40,000,000 on promissory
notes bearing interest at 2%%. Of this total, it is planned
to use $13,000,000 in 1951, $14,000,000 in 1952 and $13,000,000 in 1953. Underwriters—May be determined by
competitive bidding. Probable bidders for bonds: Hal¬
sey, Stuart & Co. Inc.; Kuhn, Loeb & Co.; Union Securi¬
ties Corp. and Salomon Bros. & Hutzler (jointly); Blyth
& Co., Inc.; The First Boston Corp.; Glore, Forgan &
Co.; Merrill Lynch, Pierce, Fenner & Beane; Kidder,
Peabody & Co. and White, Weld & Co. (jointly); Harri¬
man Ripley & Co. Inc.
Probable Bidders for preferred
stock: Blyth & Co., Inc.; Glore, Forgan & Co.; Harriman
Ripley & Co. Inc. Proceeds—To retire bank loans in¬
manent
bank notes which
June 15, SEC announced approval of a plan
United Corp., which, in part, provides for
filed by The
the sale by
the latter of its entire interest, amounting to 28.3%,
or 154,231.8 shares of South
Jersey common stock (par
$5). These holdings will probably be disposed oi to a
small group of investors.
April 4, the
program.
•
new
construction program scheduled for 1951, 1952 and 1953.
bidders:
Merrill Lynch, Pierce, Fenner &
Probable
Beane; Kidder, Peabody & Co. and White, Weld & Co.
(jointly); Morgan Stanley & Co.
or some combination thereof, in connection
with its construction program. The method of obtaining ;
additional cash requirement has not been deter¬
000, plus depreciation accruals and retained earnings, are
expected to finance construction requirements in 1951.
Of the $35,000,000, $15,750,000 had been borrowed up to
June 30, 1951.
Construction expenditures of $165,000,000 are anticipated for 1951, 1952 and 1953.
Probable
bidders for bond financing: Halsey, Stuart & Co. Inc.;
Morgan Stanley & Co.; Kuhn, Loeb & Co.; The First
Boston Corp.
Ohio Power Co.
was stated that this company, a subsidiary of
American Gas & Electric Co., will need $36,000,000, per¬
haps more, which it expects to raise some months hence
through the sale of new securities. Probable bidders for
bonds: Halsey, Stuart & Co. Inc.; Morgan Stanley & Co.;
The First Boston Corp.; Glore, Forgan & Co., White,
Weld & Co. and Union Securities Corp. (jointly). Pro¬
July
file
Telephone
reported
for the next two years.
ceeds will be used for construction program.
Pacific Power & Light Co.
June 29 it
was
announced company
plans issuance and
sale of $15,000,000 of mortgage bonds in the early part
of 1952. Underwriters — To be determined by competi¬
tive
bidding.
Probable
bidders:
Halsey,
Stuart
&
Co. Inc.; Blair, Rollins & Co. Inc. and Carl M. Loeb,
Rhoades & Co. (jointly); Lehman Brothers; W. C. Langley & Co. and The First Boston Corp. (jointly); Union
Securities Corp.; Kidder, Peabody & Co.; Blyth and Co.,
Inc., White, Weld & Co. and Harris, Hall & Co., Inc.
(jointly). (For registration of 541,464 shares of common
stock, see a preceding column).
• Parkersburg Rig & Reel Co.
Aug, 1 A. Sidney Knowles, Chairman and President, an¬
nounced that the directors have approved in principle a
plan to offer a modest amount (not exceeding $300,000)
of common stock for^ subscription by common stockhold¬
ers.
The proceeds would be used for working capital.
Formal announcement of the offer of rights is expected
In the near future*.
.
;
1
'
Pennsylvania Electric Co.
Aug. 3 filed with Pennsylvania P. S. Commission a pro¬
posal to issue and sell $5,000,000 of first mortgage bonds,
30,000 shares, of $100 par preferred stock and about
$3,000,000 of common stock (latter to General Public
Utilities Corp., parent).
Underwriters—To be deter¬
mined by competitive bidding.
Probable bidders for
bonds: Halsey, Stuart & Co. Inc.; Kidder, Peabody &
San
it
announced
was
Diego Gas & Electric Co.
company
30,970
the basis of " one
(8/28)
expects
Gas Co.
Union
soon
-
•
-
Gas Co.
construction.
-
»
-
Superior Water, Light & Power Co.
July 7 it was reported that company expects to sell $1,000,000 additional bonds this month or next and another
bonefeissue for a like amount in January. May be placed
privately.
announced company plans to increase
capital stock (par $1) from 500,000 to
July 19, L. M. Klauber, Chairman, announced that the
company plans to sell $10,000,000 of bonds early in 1952.
additional
was
Southern
Ryan Aeronautical Co., San Diego, Calif.
1,000,000 shares in order to place it in a position to
do appropriate financing of some form of its own securi¬
ties if and when advantageous to the company. The new
financing may take the form of a general offering for
sale to the public or granting of rights to stockholders;
or the
reservation for conversion of long-term indebt¬
edness which could be issued with provision for con¬
vertibility into common stock. The company presently
has outstanding 439,193 shares of capital stock, of which
45,350 shares are held by the wholly owned subsidiary,
Ryan School of Aeronautics.
on
May 23 C. H. Zachry, President, announced that com¬
pany plans the issuance of $5,000,000 new first mortgage
bonds within the next 60 to 90 days. Traditional Under¬
writer—Blair, Rollins & Co., Inc. Proceeds—For new
Boston Corp.; Merrill Lynch, Pierce, Fenner &
Beane; Blyth & Co., Inc.; Kidder, Peabody & Co.; Union
Securities Corp. and White, Weld & Co. (jointly); Leh¬
man Brothers and A. C. Allyrt & Co.
(jointly); Stone &
Webster Securities Co^x; Carl M. Loeb, Rhoades & Co.
and Equitable Securities Corp. (jointly). Proceeds—For
expansion program.
was
an
proximately. $9,187,000 is expected to be spent in 1951,
First
it
(no par)
shares
announced company has filed an applica¬
tion with FPC for permission to construct additional
facilities to cost an estimated $13,641,000, of which •ap¬
,
4
2
Southern Natural
Rockland Light & Power Co.
authorized
22
16
Aug.
stock
a
July 31 it
July 19, Rockwell C. Tenney, President, announced that
the company is planning the issue and sale this Fall of
approximately $6,000,000 of first mortgage bonds, series
D. Underwriters—To be determined by competitive bidr
ding. Probable bidders: Halsey, Stuart & Co. Inc.; The
its
record
each
to
registration statement with the SEC cover¬
ing approximately $12,000,000 of first mortgage bonds,
due 1981 (probably as 3y4S).
Underwriters — The last
bond financing was handled by Blyth & Co., Harriman
Ripley & Co. Inc. and Dean Witter & Co. in April, 1948.
Proceeds—To be used for expansion of gas transmission
and distribution system. Bids—Expected Aug. 28.
'
v
Corp.
that the company expects to
money through the sale of some preferred stock
later this year. Underwriter—Probably The First Boston
Corp., New York. Proceeds—To finance, in part, a $10,000,000 construction program the company has budgeted
Aug.
share for
.
raise
May 15 it
of
common
Southern Counties Gas Co. of California
•
Niagara Mohawk Power Corp.
Aug. 6, it was announced that it is anticipated that per¬
manent financing will be undertaken early in 1952, but
that definite plans for such financing have not been for¬
mulated
Short-term bank loans amounting to $35,000,-
of
held, with an over-sub¬
scription privilege; rights to expire on Aug. 30. Price
—$9 per share. Proceeds—To retire bank loans or re¬
imburse the treasury for expenditures for plant addi¬
tions and improvements.
>
such
was
be in
announced company plans to offer to its
was
stockholders
Aug. 1 it ipvas announced that company expects to issue
$5,000,000 additional first mortgage bonds and additional
debt securities or preferred or common stocks, bank
Rochester
year
Southern Colorado Power Co.
Aug. 9 it
Rochester Gas & Electric Corp.
July 18, it
indicated it would this
Inc.; White, Weld & Co.; Lehman Brothers; Merrill
Lynch, Pierce, Fenner & Beane and Harris, Hall &;Co.
(Inc.) (jointly).
Offering—Expected in the Fall.
shares
financing was done privately,
company
the market with $18,000,000 of senior securities. Prob¬
able bidders:
Halsey, Stuart & Co. Inc.; Blyth & Co.,
Carolina, Inc.
July 12 it was announced company plans to issue and
sell several million dollars of first mortgage bonds in
the Fall.
In July last year, $1,200,000 of bonds were
placed privately with two institutional investors.
Previous bond
■
Southern California Gas Co.
•
Public Service Co. of North
mined.
due before the end of the year/
are
South Jersey Gas Co.
borrowings,
Niagara Mohawk Power Corp.
applied to FPC for a license for a pro¬
posed new.j3rpjeck estimated to cost $22,611,000. On Jan.
26, company had announced that it probably would sell
late this year or early 1952 about $15,000,000 of addi¬
tional common stock to finance part of its $150,000,000
June 8, company
r:
Jersey Gas Co.
April 24 Earl Smith, President, announced company
plans a bond issue of more than $8,000,000 by fall of
this year. Underwriters—May be determined by com¬
petitive bidding. Probable bidders: Halsey, Stuart &
Co. Inc.; Lehman Brothers; Blyth & Co., Inc. Proceeds—
To refund the presently outstanding $4,000,000 of 4%%
first mortgage bonds and repay outstanding short-tferm
Public Service Co. of Indiana, Inc.
in connection with construction
between $10,500,000 and $12,080,000.
was
South
June 25 it
curred
(8/21)
Aug. 7 the RFC invited bids for the purchase from it of
the following securities of this railroad company: $5,785,872 general mortgage 4J/2% income bonds, series A,
—
and working
•
Corp.
imminent.
its financing program may include the sale of ap¬
proximately $15,000,000 of preferred stock. Probable
bidders may include Blyth & Co., Inc.
McKesson & Bobbins, Inc.
Lynch,
White, Weld & Co. (jointly);
Equitable Securities Corp.; The First Boston Corp.;
Kuhn, Loeb & Co.; Lehman Brothers and Drexel & Co.
(jointly); Harriman Ripley & Co., Inc. Probable bidders
for preferred stock:
W. C. Langley & Co. and Glore,
Forgan & Co. (jointly); Kuhn, Loeb & Co.; Smith,
Barney & Co.; Kidder, Peabody & Co.; Harriman, Rip¬
ley & Co., Inc. Proceeds—For 1951 construction pro¬
gram.
Expected late summer or early fall.
~
step
in
writers
Merrill
Securities
Thursday, August 16, 1951
...
•
Ultrasonic Corp.,; Cambridge; Mass.
Aug."vl5, -stockholders
,
were scheduled to vote on in¬
creasing authorized common stock from 200,000 to 400,000 shares. Early registration is expected with offering
likely next month.
Probable Underwriter—Emanuel,
Deetjen & Co., New York. Proceeds will be used in
connection with acquisition of S. A. Woods Machine Co.,
Boston, Mass.
* 1 * /
1
United
Gas
Improvement Co.
June 18, the SEC directed the company to dispose
of its
non-subsidiary companies, viz: Central
Illinois Light Co., 35,340 shares; Consumers Power Co.,
52,586 shares; Delaware Power & Light Co., 37;355
shares; Niagara Mohawk Power Corp., 145,000 shares;
Public Service Electric & Gas Co., .36,801 preference
common shares and 4,861 common shares; arid Delaware
Coach Co., a $1,000,000 note.
/
interest
in
six
■
Underwriters—To be determined by competitive bid¬
Virginia Electric & Power Co.
ding. Probable bidders: Halsey, Stuart & Co. Inc.; Blyth
May 1 the company announced that it is contemplated
& Co., Inc.; Merrill Lynch, Pierce, Fenner & Beane; The
First Boston Corp.; White, Weld & Co. and Shields & " that there will be additional financing to an amount Ap¬
proximating $20,000,000, incident to the 1951 construction
Co. (jointly); Lehman Brothers.
Proceeds—For expan¬
program, and that further financing will be required in
sion program.
1
;
>
1952.
Probable bidders for bonds: Halsey, Stuart & Co.
Schering Corp.
July 26 it
reported that the company's entire com¬
mon stock issue
(440,000 shares) was expected to be
registered with the SEC this month and offered for sale
was
probably late in* September or early in October to the
highest bidder by the Office of Alien Property. Prob¬
able bidders: A. G. Becker & Co. (Inc.), Union Secur¬
ities Corp. and Ladenburg, Thalmann & Co. (jointly);
Merrill Lynch, Pierce, Fenner & Beane;
Kidder, Peabody
& Co.; F. Eberstadt & Co.; Allen & Co.; new company
formed by United
States & International Securities
Corp., Dillon, Read & Co.; F. S. Moseley & Co.; Riter
& Co.
Inc.; Salomon Bros. & Hutzler; Stone & Webster Securi¬
White, Weld & Co.
ties Corp.; Union Securities Corp.;
West Texas Utilities Co.
July 26 Jt
was
~
announced company plans to sell $7,000,-
000 o£ first mortgage bonds late
—To
be
bidders:
this Fall.
Underwriters
determined
Halsey,
by competitive bidding. Probable
Stuart & Co. Inc.; Hemphill, Noyes,
Graham, Parsons & Co. and Drexel & Co. (jointly); The
Kidder, Peabody & Co.; W. C. Langley & Co.; Union Securities Corp.; Equitable Securities
Corp.; Harriman Ripley & Co.; Lehman Brothers; Glore,
Forgan & Co.; Merrill Lynch, Pierce, Fenner & Beane.
First Boston Corp.;
Proceeds—For
new
construction.
Number 5038
Volume 174
Continued
from
page
The Commercial and Financial Chronicle
.
8
Sterling's Roie
dollar
.
.
receipts from the EPU in
of the sterling area's
payments surplus with the OEEC
only $17 million in
countries were
compared with $76
previous quarter.
April-June,
As
the
in
result Of these and other un¬
a
favorable
surplus of the; sterling area as a
whole fell off abruptly during the
second quarter of this year, as
shown in the accompanying table.
Sterling Area Net Gold and Dollar
(—) *
,Surplus (+) or Deficit
—
31
+
,1949-December
40
1950-March
+398
December
+360
-1951-March
June
54
+
'Excludes ERP
.
other dollar assis¬
and
r
1949 to 229 million last year.
Although
'
deterioration
in
Britain's balance-of-payments
a
rearmament
is
being cushioned by continuing
on
Kingdom and Ireland,
source::
United
Kingdom
Balance
of
Payments
1946
to
1950 (Cmd, 8201),
page 25, and The Times (London), dated
July 5, 1951.
tance' to the United
Although the strength of ster¬
ling as an international currency
has been greatly reinforced by the
$1,445 million addition to Britain's
reserves since hostilities began in
the
whether
will
forecast
reserves
Defense
Mutual
Assistance
Pro¬
Britain's reserves
marily attributable
ERP
(apart from
to the gold and
assistance)
dollar
of
surplus
has been pri¬
the
Overseas-
Sterling-Area
countries,
which
have accepted, in exchange for
this surplus, credits to their ster¬
ling balances in London. In addi¬
tion, the Overseas Sterling Area's
sterling balances
were
augmented
during ,1950 by
net payments of
£179 million from countries out¬
all the
a
million
100
over
the
over,
pounds.
More¬
nationalization
Anglo-Iranian
Oil
the
of
Company
by
has
Iran
injected an element of
uncertainty into the government's
of
ings and
ers
at
running
at
the
than
creased
last year by almost £ 400
original target figure, though their
volume, during January-May ; at~
least, was about 4% higher than
million
in
the
yyith
It
balance
Britain's
of
her
seems
sterling
probable,
there has been
tial
of
payments
partners.
area
moreover,
that
further substan¬
a
growth in the Overseas Ster¬
ling
Area's
the first half of
ing
balances
sterling
in
growth
1951.
sterling
liabilities may well lead to heav¬
ier
demands
upon
the
United
Kingdom's
al¬
ready seriously strained, or alter¬
natively to heavier conversion of
balances
export
for
capacity,
purchases
dollar
in
markets.
Even
of
with
achieved
in
an
to
seems
strong
exist,
1951.
of Britain's
had
moved
imports, which already
sharply upward after
devaluation, increased another
24% during 1950, most of the rise
being attributable to a 46% in¬
in
crease
though
level
raw
material prices. Al¬
Britain's
has
been
internal
sheltered
price
against
much of this external pressure by
it
Whether
target
can
is
for
true,
the
export
new
be achieved would seem
of British
on the ability
industry to expand out¬
put, and of the Government to
cur¬
tail domestic expenditure through
and
its
as
policies
monetary
direct
dustrial
production
government's
material
raw
cently become
the other
tion
reached
wage
in
rates, which had
more
plentiful. On
hand, private
expenditures
seem
ning somewhat above the
a
fraction
of
the
rise
in
import
impact of the expanded
program
fense
enced
rearma¬
has yet to be felt
production
gets
into
full
ume
even
to
export
an
increasing vol¬
of goods in order to pay for
the existing volume
of im¬
ports. Between 1949 and 1950 the
index of the physical volume
British
at
114
of
imports remained steady
(1947=100), but their cost
difficulty in expanding
ex¬
ports to the required level.
prices, and Britain therefore has
had
found
week
report
with
but
around
rush
no
sell.
to
when
one
ance
firm
large
few
a
Potential
that
the
close
in
the
of
500,000 shares
THE
UNITED STATES
LEATHEB
CO.
The
to
buyers
conversion
enough
to
confident
are
will
the
be
set
market
to
the
The
holders
break
make
the
privilege
attractive.
Funds raised will be used to pay
Canadian
took
down
in
insur¬
sizable
a
JOHIIBHAHVH.lt
the
on
a
was
smaller
bonds,
which
were
3.38% yield basis.
the
signal
insurance
other
for
firms, particu¬
corporate pension funds to
the
for
out
working capital.
New
popular
it
Corporation
KOOUCT i
rrooWf f
DIVIDEND
The Board of Directors declared
a
dividend
75jl per ahare on the Common Stock pay¬
able September 11,1951, to holders of rec¬
ord August 27,1951.
ROGER HACKNEY, Treasurer
CITY INVESTING COMPANY
Line
Pipe
line
25 BROAD STREET,
Issue
increasingly
issues
looms
which
Commission.
to
mature
would
nicely
in
20
the
years,
issue
fit
portfolios,
the
bonds will be put up for competi¬
tive
bids
in
due
August
Proceeds
will
course.
off
outstanding
the
company
be
financing
notes
for the
expansion
natural gas
reach
to
used
pay
holders
of
record
September 17,
its
the
at
1951.
close
of
business
,
EDWARD
on
,,
FRAHER, Secretary.
CARLISLE
.
.CORPORATION
The
of
Board
declared
a
has
Directors
dividend of 10
cents
share on the outstanding
capital stock of the Corpora¬
tion, payable September 5, 1951
per
stockholders
of
record
August 20, 1951*
*
MARSHALL,
by
President
of
purpose
of
on
1951, declared the regular quarterly
dividend of $1,375
per share on the outstanding
51/2% Series Cumulative Preferred Stock of the
company, payable. October
1, 1951, to stock¬
FURBER
floated
company
15,
-
in
make
many
NEW YORK 4, N, Y.
.The.Board of Directors of this
those
of
pipe
Slated
vast
transportation system.
Seaboard
Air
Line
bonds.
It
So
Johns-Manville
m
to
of
1951.
1951.
Treasurer,
August 14. 1951.
existing loans and for additional
Exchange
came
O. CAMERON,
of
bonds
developed
that
an
issue
into
a
The
deterioration
terms of
of
her
of
Britain's
trade, the transformation
over-all
ments from
a
balance
surplus to
and the large rise in
of
a
pay¬
deficit,
her external
sterling debt, however, should not
obscure
in
the
the
decidedly satisfactory
will
what
be
bids
interesting
the
to
see
Reconstruction
elements of strength
FINANCIAL NOTICE
DIVIDEND
The United States Leather
ation.
A
Company t
$35,000,000 of serial
placed
on
the market today
To the Holders
NOTICE
You
are
per
declared, payable
of record at the close of busi¬
ness
August 14, 1951
August 27, 1951. The transfer
books of the
of
Class A Convertible
FINANCIAL
ers
Spruce Street, New York
deben¬
NOTICE
quarterly dividend of 30c
September 13, 1951, to stockhold¬
Colum¬
27
tures
A
share has been
Really "Hot" One
The Province of British
bia's
REEVES BROTHERS, inc.
oper¬
Company will not be
closed.
Preferred Stock:
J. E. REEVES, Treasurer
hereby notified that the Company
will redeem all of its Class A Convertible Pre¬
ferred Stock outstanding on the books
columbia
gas
System
THE COLUMBIA
GAS
SYSTEM, INC.
corres¬
ponding 1950 levels, and the full
surprising if the country experi¬
port prices have increased by only
last
of
the start of this week.
run¬
tion, also
Ex¬
stock
Preferred Stock payable September
1,
to stockholders of record
August 24,
Another
consump¬
to be
swing, it would, therefore, not be
significantly.
the
DIVIDEND NOTICES
up
the
been' almost steady since devalua¬
rose
block
a
prepared
demand
figure, and
supplies have re¬
by the domestic economy. As de¬
began
catch
a
target
upward
warfare
close
at
During January-May, indeed, in¬
ment
after
The
create
and
issue.
the
controls.
government subsidies, the cost-ofliving indicators began to move
Korea, and
for
the theory
on
would
market
the
ultimately
a
depend primarily
well
in Britain's terms of trade. Prices
market
buyers'
acquired
open market
Board of Directors at a
meeting held
August 14, 1951, declared a dividend of 75
cents per share on the Class A Convertible
which was expected quite widely
range of British ex¬
to
be
hanging around dealers'
ports, despite the rise in their
prices during the early months of shelves for several weeks turned
as
deterioration
achieving such
have
considerable
in
rapid
that
larly those in New England, and
January-June.
A
fiscal
a
million
1,300
increase in exports remain ob¬
scure.
its
train
the
The prospects for
serious, the great
expansion in world, and particu¬
larly United States, demand for
primary commodities has brought
its
ing for "inventory"
block
pared
bit
price and other details.
of
are
Gaitskell
the second half of this year, com¬
its
on
preferred stock and underwriters
therefore, called upon Britains' exporters to raise their sales offered
target to 1,600 million pounds in
This
to
more
Mr.
average.
has,
in
This strik¬
Britain's
1950
common
bids
of $100 par convertible cumulative
annual
an
lower
the
for
do little better than guess
can
the
sale
Dealers
was
in the current account
though potential buy¬
The company has projected the
pounds. In addition, the value of out
exports in the first half of this
somewhat
spite of the £225 mil¬
Interest is wide¬
success.
even
net
rate
lion surplus
a
in
year
the
Distillers
"invisible" earn¬ only a bare minimum of the bonds ahead in the form of
$45,000,000
his recent statement spoken for and the syndicate was
of new first mortgage bonds filed
to Parliament the Chancellor esti¬ prepared to carry it for a spell. But
mated
that
1951
net
earnings suddenly the picture changed and by the Tennessee Gas Transmis¬
might reach
only
400
million virtually the entire issue moved sion Co., with the Securities and
forecast
in
call
block, and bankers naturally are
bring the issue
port prices. At the same time, ex¬
Things change quickly in the to market next Tuesday provided
port prices have continued to rise financial world, as witness the
nothing happens to make for a
with the consequence that in June
complete turnabout in the case of
change in plans.
there were signs that the deter¬
last week's offering of $15,000,000
Mainly
actions,
result of these trans¬
the sterling balances of
Overseas Sterling Area
in¬
quick
spread
prove
ioration of Britain's terms of trade
RFC's
anxious over the possibility
u c t s
of finding themselves
holding an
forthcoming offering has
"umbrella" over speculators who
preliminary indications of
Corp.'s
the rise in Britain's im¬
side the dollar and sterling areas.
as a
since
National Distillers Pro d
Michigan Consolidated Gas
might at
least
temporarily be Corp.'s
25-year
first
mortgage
halted. On the other hand, Mr.
bonds.
;
■'
Gaitskell estimated late in July
Korea, it should be noted that the
At the time the books were
United Kingdom has incurred in that, despite the fall in primary
opened things were slow, and the
the process a very substantial in¬ commodity prices, British imports
Street looked upon the successful
exceed the government's
crease
in its sterling liabilities. might
group's bid as equivalent to buy¬
AsJLndicated above, the increase original estimate for 1951 by well
in
National
gram.
over-Optimistic. Imports, it is true,
were running fairly close to the
government's forecast d u r i n g
January-June. Commodity prices,
moreover, have recently shown a
downward tendency,
which has
retarded
activity
toward financing of its road and
bridge construction program.
United States assistance under the
govern¬
not
bills, with the balance going
market
ury
these
of
pounds between 1950 and 1951 has
thus been allowed for, it is still a
ment's
:+187
——
t
question
+180
June——--
September
"invisible" items that the
y's balance-of-payments
surplus on current account in¬
creased from 30 million pounds in
on
c o u n
position of more than 300 million
Millions of dollars
Quarter ended
international currency. Over much was tagged for
quick delivery to Finance Corp. receives for ' its
of the non-sterling world, sterling investors
lucky enough to get block of 102,273 shares of common
remains relatively scarce, and the down for a few bonds.
stock of Seaboard Air Line Rail¬
British
Government has
conse¬
According to reports in dealer road next Tuesday.
quently found it expedient to re¬ circles bankers
This block of stock is among
handling the big
increased by 400 million pounds to lax further its exchange controls, offering were literally
swamped other securities,
including $5,785,2,374 million. Despite a 16% rise thus increasing sterling's useful¬ with orders. And it was said that
872 of general
mortgage
in the quantity of Britain's ex¬ ness as an international currency. indications
4%%
pointed to little better
bonds, and 9,543 shares of series
ports, the merchandise trade bal¬ Moreover, the gold and dollar re¬ than "token" allotments.
serves are now about 60% higher
ance remained unchanged between
Part of the proceeds will be A $100 par 5% preferred stock,
the two years, and it was Only than a year ago and almost three
used by the Provincial govern¬ which will be
up for bids.
times as high as at the time of
because of a doubling of net earn¬
ment to. pay off
outstanding treas¬
There has been
devaluation. Finally, the pressure'
considerable
dollar ings
the
influences,
39
International Currency
as
settlement
million
(631)
Earning Statements
por
the
Twelve
Months Ended June 30, 1951
The Columbia
Gas
System, Inc. has made
generally available to its security holders
corporate and
consolidated earning state
ments for the period July 1, 1950 through
June 30, 1951, such period beginning after
the effective date of the Corporation's Regis'
tration
Statement for $110,000,000 princi'
pal amount of 3% Debentures, Series A Due
1975, filed with the Securities and Ex'
change Commission pursuant to the Securi'
ties 'Act of 1933, as amended. Upon re
quest addressed to the Corporation at 120
East 41st Street, New York 17, N. Y.,
earning statements Will be
mailed to the Corporation's security hold'
ers
and to other interested parties. Such
copies of such
earning statements are made generally avail'
able to security holders in accordance with
the
provisions
of
Section
Securities Act of 1933,
as
of the
amended.
11 (a)
THE COLUMBIA CAS SYSTEM,
INC.
by F. H. Crissman,
August IS, 1951.
Treasurer
August 13,1951.
of the
Company on October 2, 1951 (redemption
date), by the payment in cash for each share
of such stock to be so redeemed of an amount
consisting of Fifty Dollars ($50.00). All
rights of the holders of such stock as stock¬
holders of the Company, except the right to
receive the redemption price upon surrender
of the certificates for the stock so redeemed,
shall cease and terminate from and after the
Manufacturers of
■ftt
■■■RRHRRRir
■■■■■■■■■■Si
AMERICAN
5S
55 COMPANY, INC.
■
«
ENCAUSTIC TILING
the
jjf
TILE
If
WALL &
FLOOR
redemption date, or prior thereto, if and when
the Company shall deposit the redemption
price for all such stock to be redeemed with
Bankers Trust Company pursuant to the pro¬
visions of the Certificate of Incorporation of'
Company.
The right of holders of the Class A Stock
called for redemption to convert their shares
Stock shall not cease and ter¬
minate until the close of business on September
into Common
1951 which is the fifteenth day prior to
the redemption date. The transfer books will
not be closed with respect to the transfer of
Class
A
Stock
from
August
14,
SS
■■
The Board of Direc'
.
tors
17, 1951, inclusive. The
transfer books with respect to the transfer of
Class, A Stock will be finally closed at the
close of business on September 17, 1951.
You may present your stock for redemption
at
Bankers
Trust
Company, 46 Wall
Street, New York, N. Y., on October 2,
1951, and thereafter, subject to the provisions
of the Company's Certificate of Incorporation
-and New Jersey law.
By order of the Board of Directors,
I.
M.
$toclj
Dividend
■
m
,
Bi
UT
quarterly dividend of
Bi
■
,
■■
has
,
today de-
■ r
Bi
SS clared
■■
1951
through September
E
K
17,
the
Common
MM
a
12% cents
a
share
on
the Com-
m-
msB*
BK
SS mon Stock, payable August 31,
■5 1951, to stockholders of record
■■
Bi
B<
B*
BI
B(
on
August 24, 1951.
91
a I.
**
G. W. THORP, JR.
■r
■K
SS
Treasurer
BB
■■
August 10, 1951.
BB
■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■Ml
STICKLER, Clerk
position of sterling as an
/
.
The Commercial and Financial
40
Chronicle
Thursday, August 16, 1951
...
(632)
BUSINESS BUZZ
Business Man's
Bookshelf
on...
Activity
A
Behind-the-Scene Interpretation*
from the Nation's
Over-the-Counter
on
Friend—Univer¬
Markets—Irwin
JL 1/ iM/
l/H/
xJL f
Capital
%/ gfkWt
gJ
y*
sity of Pennsylvania Press, 34-36
Walnut
Street,
Philadelphia 4,
Pa.—paper—85c.
paper.
independent and should be taken
how
understand
To
mittee
ment
orderly
less
or
more
govern¬
freak things happen.
some
H.
Frank
C." Farwell—Richard D.
Inc., Chicago, 111.—fabri-
Loring
Irwin,
koid—$7.35.
;
war
origin
goes
the
between
tension
was
and
Treasury
When the
highest, both
at
its
managed to enroll some
violent
partisans
on
the
Hill.
fSenator Paul H. Douglas (D., 111.)
was head of the Federal Reserve
parties
Senator Joseph C.
forces, and
O'Mahoney (D., Wyo.) actual head
but not front man for the Treas¬
ury
forces.
Sentaor Joe
*sick Patman
was
on
threatening to
the Reserve Board.
Re made plans for it and pretty
well committed himself to Pat¬
man
the
when the Reserve Board and
who really belong
Treasury,
financial
secret
the
Even if conditions
Twentieth
lodge
in
flpite of their differences, met in
the chapel
of the lodge, so to
Century
42nd
West
Y.—cloth—$2.00.
N.
21st
D.
in the money
©Xyflft
im
needs
a
hard
and
behind
stand
no
reason
open
Federal
legislation.
by
System
Reserve
There is
an
the
down
cut
to
drive
"I
never
realized Ben
so
was
C.—paper—50c.
.■;;
.
Winn—University of Pennsyl-
Press, 34-36 Walnut Street,.
Philadelphia 4, Pa.—paper—85c.
interested in
Obsolete Securities!"
Waters
der
this
In
the
new
last
column
the
law,
of
light
ditures
reported in
week.
'
as
,
the
new
drain
.
,
are
on
justified as a necessary
the American economy.
huge organization
with thousands of officials, mili¬
standing up to
a
prohibitions against OPS setting
ceilings or proclaiming price rollhacks which do not reflect costs, tary and civilian, devoting their
full time to the presentation of
Eric Johnston's wonderful "profits
standard" is for a long time to self-serving statements and doc¬
as
dead as a
dodo. The uments, inundating the subcom¬
It is expected that there will be come
mittee with a plethora of testi¬
no
announcement of new mem¬ Economic Stabilizer some months
mony
and charts and
statistics
bers
of
the
System's Board of ago conjured the formula that be¬
which the subcommittee was un¬
Governors
until
two
vacancies fore an industry could get relief
able to digest, to say nothing of
are filled simultaneously.
There is from an oppressive price ceiling
it would have to prove that its being able to challenge.
one pending vacancy, that left by
"Under such circumstnaces the
were
less than 85% of
the resignation of M. S. Eccles. profits
M. S. Szymczak is expected what amc unted to an excess Congress is at the mercy of the
old, seductions of the
Reserve System, in a real pinch,
need have the benefit of clergy.
like
base.
This
was
—
University
Kansas
Kans—Cloth-—
Lawrence,
Press,
Fe—L. L»
of
$4.00.
"These seven members were
legal
to believe that
Apeak, gave the secret handclasp, shortly to leave, having obtained profits- tax
sidered too
mid made up.
permission to accept a post with
Santa
Trails to
Steel
Administration
the
80O
vania
Treasury
having
time getting, it is not ex¬
that
Association,
Planning
Street, N. W., Washington 6r
Positioning of Securities on the
Over-the-Counter Markets—Wil¬
lis
lot of money it is
pected
would
the
Theodore
and
tional
of
malfe it tough for Treas¬
contractors
Beardsley
Geiger—Na¬
Five Percent, The —■i
Ruml
fun
financing come next January
Fedruary and the dough is
new,
Brown—The
Fund,
330
Street, New York 18,.
G. Hart and E. Cary
tired
chair¬
having
is
he
when
market
a
Expenditure Policies—Albert
and
the really rolling out to pay defense
to
Reserve.
Federal
the
back
,
Financing Defense—Federal Tax
half hour or so, or too
developing his particular line
ury
Erwin
—
Roland I.
Gane, and
editor;
Boehmler,
Robinson,
political merchandise.
and
This is one of those freaks.
The
a
bother to challenge the
man
the processes
lo understand that in
of
fellow
a
to head a subcom¬
subject one has
that
on
for
to
Administration.
the
by
like that gets
to
Institutions
Financial
W.
Congress
•over
Pro¬
Urbana, 111.—
of Illinois,
versity
the new session pan for raising prices, it is the
meets in January, chairman who calls the bigwigs
■came
pretty close to telling the of the industry into open hearings
calls
them
bad
things in
whole world what he thinks the and
snonetary
subcommittee "court" polite language for their conduct.
be heads should rule.
The committee is so unimportant
It should rule that the Federal that other members are usually
Reserve System is too gosh darned too bored to hang around except
of
—
ceedings of the Consumer Credit
Conference—College of Commerce
and Business Administration, Uni¬
after
time
/some
Credit Today
Consumer
will allow the
WASHINGTON, D. C.—Just in
monetary hearings to be turned
case anybody is afraid of the big
into a drumhead court organized
bad wolf, Patman, forget it, turn
for the purpose of promoting the
over children, and go to sleep.
legal rape of the Reserve System.
Rep. Wright Patman (D., Tex.)
Because of the unimportance of
is chairman of a Joint Economic
.subcommittee which is supposed the JEC, it is customary for the
to make a monetary study. Mr. chairman of the full committee
Patman, the other day, announc¬ or of a subcommittee, to have a
field
day with hearings. If for
ing this, his* course of monetary
Jbearings would be postponed until instance, some industry is on the
whom
of
neither
Executive
con¬
branch
of the
govern¬
Utilities
—
available
in
stocks.
undervalued
available
—also
analyses of IT
opportunities still
New
utilities showing
ratings
new
are
reports on 15 Electric Equipment,.
Radio and Television; 44 Chemi¬
cal, Drug, Liquor; 37 Motion Pic¬
ture and Insurance; and 45 Foodh
Stocks—special introductory offer
including four weekly editions
ratings
and
of
special
with
reports
situations recommendation, super¬
vised
account
nightly
letters
report,
and
two
four
fort¬
weekly
complicated and ment, particularly on such a vital
supplements, plus 48-page edition*
special dreamy to work out in practice. activity as national defense in a
on
Electrical
Equipment, RadioHowever, the new DPA law for time of crisis. What if the Defense
legislation.
as though he were frothing at the
asked
for $80 and Utility Stocks and Commen¬
ail
practical purposes makes it department had
When men have been found to
mouth whenever the Reserve
instead
of
$56
billion?
obsolete, strictly one of a building billion
tary on New 1951 Taxes — $5.00System comes up for discussion, fill both vacancies, they probably
full of bureaucratic freaks, even Would the committee have been
bad got his promise to preside will be filled at the same time.
—Dept. CF-5, Value Line Survey,.
though the final DPA act did not able to challenge and resist the
over a series of "get the Reserve
East
44th
5
Street, New York.
expressly repeal the- profits request?" Rep. Meader asked.
■System" hearings—a
procedure;
The
fundamental problem ' of standard as the House proposed.
"The Congress needs fact-find¬
17, N. Y.
incidentally, NOT aided or abetted how to reconcile "a pretty good"
ing investigators to squeeze the
$
#
by the Treasury.
tax bill with a lousy one may be
water
out
of
these
appropria¬
The fact that Mr. Patman sounds
Rep. George Meader (R., Mich.) tions."
For
one of the
big problems of Sept.
has stated perhaps as clearly as
its though he would like to spon1951. There
is every reason to
*
*
Large Appreciation Potential
•«or legislation to turn the Reserve
believe that the Senate Finance any one the case for the joint
WE SUGGEST
Note:
When war with Russia
System over to the Administra¬ committee will come up with a budget staff to investigate Ad¬
ministration requests for expen¬ is
almost
a
certainty—that is
tion, and heads a subcommittee to
fairly respectable bill.
It will
ditures. This is the proposal of when the military needs to justify
•"Inquire" into monetary problems
probably increase excises some.
Senator
John L. McCellan
(D., appropriations for the domestic
and come up mysteriously with
It is probable
that the Com¬
CLASS B (common) STOCK
an answer in favor of subordina¬
Ark.), chairman of the Senate military establishment and, on the
mittee will not go beyond 50% on
A leading producer of cement
other hand,-when a Congress
tion of the Reserve System, is a
Expenditures committee.
*•«
the corporation income tax rate,
In fast-growing Southern
scatter regarded as of little prac¬
skeptical of Europe's contribution
"A David without a sling stood
versus
the House approved 52%,
California.
,/';7v ;
is approached to appropriate $8.5
tical significance.
and the Senate committee, if it helpless before a $56 billion
Analysis of this Company and
billion therefore, that is the time
In the first place, even if the
week,"
said Rep.
a review of the Cement Indusdigs the excess profits tax scalpel Goliath last
when'we were never doing better
flubcommittee
could
be
handled
in
at
try available on request.
all, will cut shallow. In Meader.
and have got the Reds licked al¬
by Mr. Patman, which is not |he place of the "soak the rick" 12^2%
"Seven
members of a House
Selling about $14.00
ready.
V;''
case, the Joint Economic commit¬
surtax, the
betting is that the Appropriations subcommittee
tee is in itself a freak without the
Senate
committee will favor a shouldered the terrific burden of
(This column is intended to re¬
LERNER & CO.
added benefit of any
one
with straight increase percentage wise
assuring 428 other members of flect the "behind the scene" inter¬
Investment Securities
curious ideas heading it. The JEC
in the personal income tax, some¬ the House and 150 million Ameri¬
pretation from the nation's Capital
is not legislative committee. It
10 Post Office Square, Boston 9, Mass*
and may or may not coincide with
thing like 3%- in all brackets.
can people that $56 billion of pro¬
Meanwhile Patman, who sounds
a
member
under
bank
,
RIVERSIDE CEMENT CO.
,,
cannot
originate and pilot legisla¬
either House.
If it
tion through
Between
such
a
bill,
if
it
de¬
posed Defense department expen¬
velops, and the House bill, there
is little room for compromise and
fiets an idea, it has to persuade a
legislative
committee
(like
the
trading. It may be that the House,
Banking or Finance committees)
which tacitly recognized that it
to adopt the legislation and pilot
evaded the job of raising taxes
it through Congress.
by a 75%
"soak the rich and
There is no record of any
corporations" bill, will tacitly ex¬
»oticeable legislation having been
tend the recognition by accepting
inspired as such, directly or in¬ the Senate bill.
directly, by the Joint Economic
-committee, which"*hag remained
nothing
form
from
curious,
snore
But
Ills
Mich.)
or
less than
which
ideas,
a
plat¬
mostly
and
propaganda,
even
unusual, can be howled.
Mr.
own
cludes
more
Patman
cannot
handle
subcommittee, which in¬
Rep. Jesse P.
and
Wolcott
Senator
(R.,
Douglas,
the
Senate
and
Finance
Means
*
*
and
Allied Electric Products
FIRM TRADING MARKETS
FOREIGN
W. L. Maxson
House
FOREIGN SECURITIES
the
old
SPECIALISTS
50 BROAD STREET...NEW YORK 4,
*
DPA
proclaimed
law, which
would not have been possible un-
Kingwood Oil
Carlmarks & C2li^
N. Y.
TEL. HANOVER 2*0050...TELETYPE: NY 1-971
Note that the OPS recanted the
under
Beneficial Corporation
SECURITIES
committees.
several price rollbacks
Tel. HUbbard 2-1990
m
WmMmi
If not, there will be some hot
doings in the conferences between
Ways
the "Chronicle's" own views.)
.
Hill, Thompson & Co., Inc.
Trading
Department
70 WALL STREET,
k
lixi.
>
t
i>A
Tel. WHitehall
%
V<K. Ai, 1
N. Y. S
4-4540
@FedFRASER