Full text of Commercial and Financial Chronicle : August 21, 1947, Vol. 166, No. 4622

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feroorcAL
1

AUG 2 2 1947

*1'

Hoeia

PERIODICAL

|StMtiuL LIBRARY

JUN1V. OF MICH

LIBRAE*

GENERAL

ESTABLISHED 1S39

,(i

ROOM

MICH.

UNIV. OF

cti

Chronicle
Reg. U. S. Pat. Office

Copy

Price 30 Cents a

York, N. Y., Thursday, August 21, 1947

New

^622

Number

166

Volume

Chaos to Allied German
Elbow Room lor Perils ol the Free Market,
Controls and Reparations
National and International
The Railroads
In

capital ex¬

need for new

in-

gress

make

act

into

(3) international commodity controls; and (4) control
Urges education to enlighten public on value of
markets as means of maintaining individual enterprise and

free

avoiding collectivism.
My grandfather grew up as a member of a
i

pos¬
mssmmm

roads to obtain

capital to
dertake at

e r e

Potsdam agreements, the

outlined

General Eisenhower

boyhood
ex¬
periences, full

EDITORIAL

great pro¬

gram

hunter,

of needed

railroad

first

sion and im¬

inflation of
in

crease

our

the in¬

currency,

hunt.

recognize the
animal itself."

F. A. Harper

advice

That

good for hunting wolverines
1847.
And it is equally good

was

supply, and

money

you

wish

the

among

are

the

Then learn

biggest
of materials and the big¬
gest employers of labor. Therefore
they are seriously affected by the
:ountry

Imyers
h

animal

this

roads

the

tracks

rail¬

The

Parkinson

T. I.

And Now It Is the Cost of Living

for hunting the economic fallacies
consequent increase in prices
They are even more and perils to the free market in
1947.
affected than some other indus¬
Most of the world's economic
tries because of the strict regula¬

State and Federal govern¬ aches and pains are merely sur¬
ments of their services and their face symptoms for lack of freedom
rates
for
both
passenger
and in the market. Many people do
freight transportation. In addition not understand the connection be¬
freedom
and
a
they carry a heavier burden than tween market

tion by

healthy economy. " They have
*A statement
released by

by Mr. Parkinson

learned

the Continental Press

recognize

how

19)

page

two

years

elapsed, the
taught

by Mr. Harper be¬
Symposium of the Na¬
tional Association of Commodity

at all will

ciated

thau's
come

beginning of the

1927

State

(Continued on page 28)

Teletype NY

BAnover 2-0600

Geneva

1-210

London

Cleveland

Chicago

(Representative)

SERVING SOUTHERN

Bond Department

THE NATIONAL CITY BANK

Troy

HART SMITH & CO;

PHILADELPHIAf

Albany

Buffalo
Dallas

Baltimore

Scranton

Pittsburgh
Williamsport

Wilk'es-Barre

Springfield Woonsocket

Air Products,

Emery Air

NY 1-708

Inc. Com. &

"A"

Co. Com.

New York

626

SPRING

Distributors of

Georgia

Municipal

Raytheon Manufacturing
$2.40 Conv.

Corporate Securities

ANQiltS

OTIS & CO.

(Incorporated)
Established
ClAREMONT

•

Preferred

*Prospectus on

TRinity 5761
10$

PASADENA

REDIANDS

•

MEMBER LOS ANGELES STOCK

EXCHANGE

TELETYPE: LA 68

1899

CLEVELAND
-

.
Chicago
Denver
Columbus Toledo Buffalo

New York

Cincinnati

THE CITY OF

Reynolds Stock Exchange
& Co.
York

Members New
120

York S, N. Y.
REctor 2-8600

Broadway, New
Telephone:

Bell Teletype:

NY 1-635

England

New

Public Service Co.
PLAIN PREFERREDS

for Banks,

Brokers
Analysis upon request

and Dealers

Co.

request

NEW YORK

Toronto

Common

and

ST.

1-395

Montreal

Service

Freight Corp.

Hardwood Lumber Co.

Teletype NY

2-0980

Bond Brokerage

Common

Underwriters and

HAnover

THE CHASE

NATIONAL BANK

Security Dealers Assn.

WILLIAM ST., N.
Bell

Bond Dept. Teletype:

Detroit Harvester

Securities

Members

New York

OF NEW YORK

Syracuse
Harrisburg

SINCE 1927

Investment

/ ;

CALIFORNIA

WagensellerSDurstJnc.

and

Municipal

BOSTON

York 4, N.Y.

New York 5

64 Wall Street,

Exchange

and other Exchanges

the

transition from

(Continued on page 20)

INVESTMENT SECURITIES

25 Broad St., New

General Clay mark

R. H. Johnson & Co.
Established

Members New York Stock

The instructions

end.

to an

issued to

Hirsch & Co.

Henry Morgen-

with Mr.

Allied
Trades,
Inc., New York City, Aug. 14,1947.

Havana Litho. Co.

in its

pastoralization scheme, has

profits and

"bust" largely by reason of high

which

will always be asso¬

and

Exchanges

Aerovox Corp.

policy,

this

crudest form

so the story ran, and wages so low that there was
possibility of currently generated purchasing power
matching the volume of goods being produced and
offered for sale at these prices.
The "boom" was on the

For the chaos

does not pay.

been

last,

promised the public if business were left to its own de¬
vices in the half measure which had developed with the
demise of .the OPA and the executive actions which put
an end to* a number of other controls.
Profits were so

Bonn

intensified under and
through Allied controls. At long

easily recall that only a few short months ago—we had
almost said a few short weeks ago—dire things were

verge

that

the

Moritz

the

Germans

large,

*An address

have

Allies

has

those with virtually no memory

have

which

peace

save

the

pay.

amusing and edifying.
All

not

does

ness

strange reason to

some

the

(Continued on page 26)

fore

war
wicked¬

and

think of himself as both econ¬
omist and good timber for high office. Recent developments
afford excellent illustrations of all these. The record is both

for

Hit¬

that

ler,

larly, of the politician who thinks of himself as an "econo¬
mist," or, better yet perhaps, the ordinary man who comes

not

Service, Brightwaters, N. Y.
(Continued

.....

Verily, the ways of the political mind are past finding out.
also is the functioning of the mental equipment of many
the "economists" who serve the politician, and, particu¬

the

and in wages.

be¬

chaos

them

♦

recognize

provement.

learn from

the

queathed to

learn

EuThe

Germans were

We See It

must

"you

the

rope.

boy," he said,

expan-

which

guar-

peace

successful
a

<$>was

antee

you

want

instructions to

policy of planned destruction,

—:

advice.

"If

un¬

Scores economic policy in

sting y

of sage

once

and the economic distress caused

separate zones.

Three months before the

pioneer family in the

the Indians. He used to tell me many

wilderness of Michigan, among

for rail¬

sible

many

private enterprise economy; (2) unstable money

of exchange rates.

Con¬

tive urges

by division of Germany
Anglo-American
zones as hampering German economic recovery and as both costly
and profitless. Advocates establishing unified administrative agency
in Germany to control and administer German industries.

perils to free markets: (1) growth of government

on our

drain

Ger¬

Russia's crippling reparation exactions in

Dr. Bonn describes

free market and its benefits,

systems;

and

execu¬

surance

■

BONN

Government on Reparations

Formerly Advisor to German

Education, Inc.

for Economic

economist lists

of the railroads

penditure for improvements
additional equipment, leading

Foundation

After outlining what constitutes

fi¬

commenting on the present

nancial difficulties
and the

The

By MORITZ J.

F. A. HARPER*

THOMAS I. PARKINSON*
President, the Equitable Life
Assurance Society of the U, S.
By

Membert
Members

York Stock
New York Curb

New

30 Broad St.
Tel. DIgby

4-7800

Members

Exchange
Exchange

New York

haupt&co.

ira

Hardy & Co.
4

Tele. NY 1 -733

Broadway,

111
REctor

York Stock Exchange
Principal Exchanges

New

and other

2-3100

Boston

N. Y. 6

Teletype NY 1-2708
Enterprise 1820

Telephone:

km*.

(714)

4WI *<

THE

COMMERCIAL

Investment

Portland General
distributed

By HENRY ANSBACIIER LONG
,

Survey by authority indicates that

Power Co. 6/50

Buying

and

steels.

Cautious

was the predominate note among the trans¬
during the second quarter of 1947. Although
during the. earlier part of this period, security markets were in a declining phase, there

actions

New York Hanseatic

was

Corporation

purchasing of

investment

stocks

common

company

stam¬

assets

preference

where

1-583

they

groups

had

been

of ..the

3/6s, 1956

Portfolio

likewise

Other favorites were agri¬
cultural
and
office
equipments,

Concentrated liquidation was con¬
spicuous in the shares of the rut>

Class "A"

from the first

ber

three

mobile and beverages groups were
also unpopular.

Vapor Car Heating

months

Common

Members New York Curb Exchange

31 Nassau Street, New York 5

exercise

■

of rights

stock dividends be

or ;as

excluded,

pur¬

chases will be found to have

only
slightly topped the number made
during the first.period of the year.
Selling
decreased
considerably

Telephone COrtlandt 7-4070
Bell

Henry A. Long

issues

received

through

System Teletype NY 1-1548

and

Special
to

the

reasons

substantial

scattered

inroads

and

steel

companies.

Auto¬

man

cash positions

made

of the

The

While

•net

the

cash

majority

and

9.7. million to
or

receivables

from

12.2 million dollars

19.3% of assets. Selected Amer¬

tion of managers

quarter which

noted

with'

certain degree of approval in

120

Stock

York

tion which

22.4%

preceding quarter,
buying was concen¬

the

oil

leading electrical "equipment

also

Chemicals

were

outstanding favorites in addi-

REctor

of its

observed

where

portfolio.

that

cash

June 30 constituted

was

It will

instances

most

Tightened,

com¬

period

Members Baltimore Stock
120

published

observe

for

reasons

look, outside of the perfectly ob¬
reason of not
selling when

prices have been radically slaugh¬
tered. Does this indicate that

(Continued

page

Bell

Common

Detroit Int'l

22)

2-7815

Iron1

Finishing com. & pfd.
Virginia Electric Power Co.
Electric
New

Bd.

Eng.

Gen'l
Title

Electric

Aniline

United

England

Dye

Artists

Dumont

Trust

New

Piece

United

Stubs

System

Film "A"

Guaranty

Northern

Wks.

Theatre

Laboratories

Boston & Maine R.R.

Tudor City Units

Chairman of Board,'Johns-Manville Corp.

Frank C. Masterson & Co.
Established

being written'immediately upon my return to
apparent that the reorganization of Germany is, of
necessity, part of the reorganization of Western Europe under the Marshall Plan.
The

key to
lies

action

decision of the

dam Agreements, is predicated on
fallacies and has made impossible
the accomplishment of the very
objectives which we all considered

sum¬

have

mary,

I
to

first

have

indi¬

cate

Int'l Detrola

must

J. P. Stevens

Lea Fabrics

Effect

things
I

tried

Ilaytian Corp.

imperative.

shall

Plan

if approval of
the American

OTeenecmiCompann
Members N. Y.

Security Dealers Assn.

St., N. Y. 5

Hanover 2-4850

Teletypes—NY

1-1126

1127

Lewis H. Brown

Not

even

Congress I is

can

beginning

solution of the problem
Western
Europe
unless
we
a

Americans

recognize

acceptf the present' partition
Germany as an accomplished

and

admit

Arkansas-Missouri Power
Black Hills Power &

Light

^Central Illinois Electric & Gas
^Central & Southwest

summary

report

being
inspec¬

orepared by Mr. Brown on
tion trip to Germany at request of
Gen. Lucius D. Clay.

world.

1923

York

Curb

ST.

Exchange

NEW YORK 6

HAnover 2-9470

Curb and Unlisted

Securities

rest of
*

the

end

MICHAEL HEANEY, Mgr.

five

they must export twice

years

WALTER

meantime,- they must be
primarily from America by

fed

loans advanced
a

not

five-year plan

relief,

but

incentive

get German industry ihto pro¬
duction so that she can export to

buy necessary
the

Members

Germany

are

food

Germany
relief

48,000,000

pro¬

than 50% of their food

requirements.
These
people
in
Western Germany can only pro¬
vide

the

other

requirements

half of

their food

manufacturing

York Curb

Broadway

Exchange

New York 6

Digby 4-3122

Teletype NY 1-1610

her

food

require¬

ments.

merely

provided

Reiter Foster

Western Europe on a
basis—if food is not used
incentive and a means to
or

production—then
it
is
East is now in the hands of Poland merely pouring dollars for relief
and the Russians.
In the Amer¬ down a bottomless rathole with no
ican, British and French zones in hope of eventually getting either
people who cannot possibly

New

Chicago Stock Exchange

materials and

raw

balance of

Joseph McManus & Co.

under which

Oil

partition of Germany means as an
that Germany's breadbasket in the getting

Western

KANE, Asst. Mgru

much per capita as before the war.
the

The

vide
,

Russia,

succeed. We must there¬

never

fact at least for the present.

secured.

•made to

Germany

fore

to succeed and

ArgoOil

in view of the attitude of
can

Mar-'

Time, Inc.

Division

quadripartite division of Germany

what
done

exporting goods to the

the

food will be used

We must also recognize that the

the

and

put

first.

•

Hood Chemical

Bell

the Morgenthau
philosophy,
dictated by President Roosevelt
in the Quebec, the Yalta and Pots¬
as

ain and in the

Moxie Common

37 Wall

that

by Great Brit¬

tried

Foundation Co,

New

success

In this

Swasey

WALL

Teletype NY 1-1140

This brief
summary of my report is
It is written because it is

Congress.

Newmarket Mfg.

Members
64

America.

American

Aetna Standard Eng.
Punta Alegre Sugar
Warner &

Bridge

Reiter Foster Oil

on a two months* inspection of Western Germany's industrial
potential, Mr. Brown points
policy for revival of Germany is required if Marshall Plan is to succeed. Recommends:
(1)
increased Ruhr coal production;
(2) moratorium on coal shipments from Germany; (3) allowing
greater food consumption in Western Germany, and (4) setting
up an organization to deal, with
the problem. Foresees cost of $2 billions to
guarantee food for Western Germany, as well as addi¬
tional American loads to avoid Western
European economic collapse desired by Russia.

Steel

(Va.)

Stock

By LEWIS H. BROWN*

detualTHaTketi Qn
Wharton

1-1227

Central States Elec.

man-

Reporting

2-4230

Teletype NY

the

out new

Taylor

Exchange
Broadway, N. Y. 5

WOrth

issue, it is interest¬

Revived Germany Essential to Marshall Plan

Exchange

BROADWAY, NEW YORK
Tel.

Printing

Virginia-Pittsburgh Coal

vious

two

Exchange

Curb

National Dyeing &
West

present apparent reversal in out¬

Members
York

Interstate Hosiery

May, McEwen & Kaiser Co.

ing

MCDONNELL &C°New

Elk Horn Coal Com. &
Pfds.

our

million, making this item almost
20% of assets, while Bullock Fund
doubled its previous liquid posi¬

the

manufacturers.

New

branch offices

our

during the first

was

trated

Request

NY 1-1557

La.-Birmingham, Ala.

Direct wires to

year ends on June 30 and a
large
capital gains dividend of 6 million
dollars was paid
during the quar¬

companies and in the stocks of the

Prospectus

New Orleans,

European
Securities.
Lehman Corporation's fiscal

survey of that
in the May 22

outstanding

Bought—•Sold—Quoted

Exchange

St., New York 4, N. Y.

HAnover 2-0700

Corporation, Blue Ridge, and

ican Shares upped cash and gov¬
ernments from
1.7 million to 3

Public Service of Indiana
2%s, 1962

25 Btoad

Leh¬

throughout
individual issues.

was

many

Conv.

Memtofft New York stock

May.
assignable

are

ter. Blue Ridge
employed a simi¬
of invest-' lar amount of cash to redeem its
ment
managers
decreased their preferred stock, while American
cash positions slightly, there were European paid off a preferred is¬
a
few outstanding, exceptions, as sue at a cost of 2% million dollars.
may be seen from reference to the
Reasons for Trend Reversal *
accompanying table. State Sti In¬
In view of the marked
vestment
Corporation increased
liquida¬

individual

utility

Vanderhoef & Robinson

and,

if the number
of

Steiner,Rouse&Co.

American

Credit.

decreased

tivity, in fact,

in fairly good
enabling their

were

positions,

Financial and Commercial

ac¬

1947

liquid

managers to take advantage of the
low market prices of last

in the

Savoy Plaza

panies already

the two major can companies, and
the large finance concerns, C. I. T.

year..

companies,
which
two
having
been

towards

year.

during the
first quarter

Savoy Plaza

noticeable in the first part of the

ac-

cumulated

aviation

the

tion

liquid

120 Broadway, New York 5

Bought—Sold—Quoted

managers

pede to invest

Teletype NY

Louisiana Securities

■

BOUGHT—SOLD—QUOTED

7-5660

Sold rubbers

and aviation shares.

Alabama &

used cash accumulated during previous
concentrated in oil, chemical, eleclrical equipment

trust managers

many

making cautious purchases.

periods in

Portland Electric

BArclay

Thursday, August 21, 1947

Companies Bonght in Jnne Quarter

Elec. Co. Common
When

CHRONICLE

FINANCIAL

Germany
off

the

backs

other

Circular

Request
■i

—

countries

the

Corp.
;

★—

American

taxpayer.
On the other

Troster, Currie & Summers

New York Security Dealers Ass'n

hand, food can be
used—if it is used properly—as a
means

Members

getting these countries

(Continued

page

i;l

25)

Corp.

Federal Water & Gas
Indiana Gas & Water

*Michigan Gas & Electric
*New England Gas & Electric
*New

England Elec. System

Puget Sound Power & Light

Republic Natural

Gas

*Prospectus available
dealers and

banks

G. A. Saxton &
70 PINE

ST., N. Y.

Teletype

We Maintain Active Markets in U. S.
FUNDS for
Canadian

SOUTHERN

United Kingdom 4 % '90

Canadian

Banks

Rhodesian

Canadian

Mines

Canadian Utilities
Canadian

Securities
Department

Acme Aluminum Alloys, Inc.
$1.10 Conv. Preferred

Industrials

Selection

Gaumont-British

Securities

Solar Aircraft

COMPANY

90c

Department

BOUGHT

—

SOLD

—

QUOTED

WHltchall 4-4970

1-flW

Goodbody & Co.
Members

Stock

115 BROADWAY
Telephone BArclay 7-OlOQ

NEW YORK 6, N. Y.
Teletype NY

1 -672

INCORPORATED

37 WALL STREET

NEW YORK 5

ESTABLISHED 1890
TeL HAnover 2-9300

Tele. NY 1-1815

I ■'

^Universal Winding Company
90c Conv. Preferred

*Prospectus

J-G-White 6 Company

Exchange and Other Principal Exchanges

Company !

Preferred

$1.25 Conv. Preferred

only

Co., Inc.

Conv.

^*Twin Coach Company

Common

Scophony, Ltd.
British

PRODUCTION

Common

request

Reynolds & Co..
Members New
120

York

Stock

Exchange

Broadway, New York 5, N. Y.
Telephone:
Bell

REctor

Teletype:

•

2-8600
1-635

Number 2622

Volume 166

■il

THE

COMMERCIAL

FINANCIAL

7RONICLE

(715)

■

INDEX

The SEC Is

Articles

and

News

Page

—Moritz J. Bonn

Cover

—

licHifnsitu

Securities Business

Aliie^German Controls and Reparations

Chaos of

Undermining the

AMD COMPANY

By JOHN DUTTON
Perils to the Free Market, National and International

—F.

Harper,

Commenting

Cover

Elbow Room for the Railroads—Thomas I. Parkinson

Cover

.—Henry

Long—

SEC's claim that it is

—Lewis

there

—

Brown-...

fraternity who

SEC Is Undermining the Securities Business

The

—John

Dutton

Interest Rate Possibilities—Siguard R. Wendin
Sugar Future Trading in New York—John C. Gardner

ceeds

say

99 WALL

of those gullible members of the securities
"Amen" every time some spokesman for

to the dollars and cents

Last
6

More About Sun Spots and Economic Cycles—Daniel

Pingree

You"

What of America's Future?—Rep. Joseph W. Martin, Jr.

Aeronca Aircraft Com. & Pfd.

Hoving Corp.
Jack & Heintz

Haile Mines

angle!

U. S.

„

William

The Task of World Peace—John Foster Dulles

Bridgeport and Socialism—Roger W. Babson
<■'

...»

Marshall

Vital:

European Recovery

"Horwath" Reports

1946 Hotel Earnings

Camille Gutt to Confer Abroad

imate

Marshall Plan

Taft-Hartley Act

Here

Rumania Drastically Devalues Currency.

World Bank and Fund Become Agencies of United Nation-w

Gromyko Accuses U. S. of Crudest Interference in Greece—. 18
SEC Preparing to Move to Washington.

Commerce Department Reports IJ. S. Production at New

High 18

International Monetary Fund Reports on Financial Condition

Anglo-India Interim Financial Agreement Signed

Regular Features
'

"■ r;'

Page
As

Bank

See

and

Business

(Editorial).!

Events

Coming

Wilfred

Our

Governments

Prospective

Field

Dealer-Broker Investment

Einzig—Convertibility:
From

the

Bargeron____._—

Activity—

(Walter

■^'See

Bankers..

—

Whyte

article

Other

and

FINANCIAL CHRONICLE
WILLIAM B. DANA COMPANY,
25

Park

Bank

Patent Office

Place, New

$25.00

Publishers

per

$38.00

year.

per

year

year.

Record—Monthly
postage extra.)

(Foreign

—

Monthly

postage extra.)

REctor

2-9570

9576

the

BERBERT D. SEIBERT, Editor & Publisher

WILLIAM

DANA

SEIBERT,

rate of

account of

the fluctutations

made

exchange, remittances for for

New

are

York

Security Dealert

Attn.

Broadway

Bell System Teletype N. Y. 1-716

Haytian Corporation
Punta Alegre Sugar
Lea Fabrics

fllS

KNOW

GAL

ANYONE

WHO

SECURITY

U. S.

DUNNE SCO.
Members New York Security Dealert Attn.

25 Broad

small business,

establishing

industry through

man's changing

There

funds.

St.. New York 4, N. Y.

stimulate

rules upon
to

Sugar

Susquehanna Mills

the

enough

are

eign subscriptions and advertisements must
be

President

YOU

Le Roi
BOUGHT

law

enforcement

agencies in this

QUOTED

—

CORPORATION
New York 5, N. Y.

Tel. HA 2-8080

Tele. NY 1-2421

Established

1858

H. Hentz & Co.
Members,.

New

York

New

invest¬
virile securities indus¬

system which is subject

SOLD

—

52 Wall St.

encourage

whims rather than definitive law.

Company

FIRST COLONY

advertised

wrapped up and
In fact the SEC
should be eliminated anyway as an unsound political
and economic venture which has the power to enforce

(Foreign

Record

REctor 2-4500—120

York

./New

try then the whole outfit should be
abolished before tomorrow morning.

Publications

Earnings

Note—On

ment and assist in

$42.00 per

Quotation

year.

Monthly
$25.00

York 8, N. Y.

and
per

page

Established 1906

Members

WHitehall 3-02T2—Teletyp. NY 1-W«

efforts

Canada,

Countries,
Other

this week.

INTRODUCE

If this is the result of the SEC's often

Says)—

available

Dominion

Weekly

Twice

COMMERCIAL

Industry.^

Washington and You._

Reg.

Registration

Tomorrow's Markets

"^Not

Published

***

Now

The State of Trade and

Notes—

The

—

NSTA

Securities

Estate

and

About

Banks

News

...

Securities

Ahead

Business

Real

Securities!

Securities...

Funds.——..—..——

Mutual

Who

News—Carlisle
Indications

Utility

Offerings—_

Securities Salesman's Corner——

__——

Washington

Public

Security

May—

Recommendations

Blame?

Reporter

Railroad

Investment

the

Page

Bookshelf

Securities

Canadian

Observations—A.

Cover

Stocks

Insurance

Man's

figures in black and white (we mean red)Department Of Commerce no less—$22,000,000 loss in 1946
for the incorporated securities dealers and brokers.
Why
are we in business
anyway? To protect the public? To give
out charity? To finance jobs for the CIO and the Commies
while they tell us Wall Street stinks and the United States
is mighty lucky that a couple of hundred government law¬
yers head up a thing called the SEC. If you listen to some
people who have fallen for SEC propaganda (and they dish
out plenty of it) everybody in the securities business owes
a debt of gratitude to the SEC and the
Maloney Act NASD
which we can never repay. Maybe that is why we are sit¬
ting around sucking our thumbs while everybody else in
the country is busy making money. How many new men
are entering the securities
industry today? If you are in
it you know how few there are. When was the last time
you heard some young fellow say he wanted to go out and
sell securities because there was a good future in it?
I
know of dealers who have been scouting around for months
on end trying to hire salesmen and the only ones they can
get are broken down hacks who are looking for a free lunch.

BUT

reasons.

SALESMAN?

William Green Wants Labor Day Dedicated to Repeal of

J.K.RlCe,Jl*.&CO.

era

WANTS
Reports Britain's Output at New High Despite Crisis

play the 'orses. The whole United States is mak¬
ing dough hand over fist; taxes are being collected to the
tune of about $41 000,000,000.
Mr. Farmer is selling his
wheat and corn at $2.35 a bushel while
every traveling
salesman is trying to meet his
daughter—this time for legit¬

January 1947 Levels

profit liability fell from $147,-

excess

radios and

Sees Building Costs Stabilized at

Ilarry A. Ward

U. S. Trust Co.

appeared the

sumpthin'? Here we are enjoying the
of overall prosperity in the history of the counry with production booming in practically every line of
industry. On street corners men stand in line to buy cars,

New Anti-Trust Suits Opened by Attorney General Clark—.

and

income

greatest

there

Now ain't that

"Chronicle"

in 1946."

the

$7,000,000 loss in 1946, according
to a Commerce Department study.... Profits after taxes
shrank from $105,000,000 in 1929 to a
$22,000,000 loss

Knowland—

0(10,000 in 1929 to

Leading the World in Achievement
—Sen.

rate

Finishing Com. & Pfd.

Thursday Aug. 7th, in the "Washington And

column

following item: "Corporation profits of security brokers,
dealers and exchanges, before Federal and state corpo-

Economic Cooperation vs. War—Philip D. Reed

STREET, NEW YORK

tell you

comes

G. Keesing—

doing-

Telephone: WHitehall 4-6551

Bretton Woods in Retrospect and Prospect (concluding

instalment)—F. A.

he's

the junk he buys.

judged by

and SEC is not needed

that Lichten-

you

what

know

how lucky you are because you have a
SEC, you should ask him a few questions. It isn't the way
it is painted brothers and sisters.
No siree—not when it

cases

will tell

can't

stein

fostering "a virile securities industry." Holds

of your meetings, and after he has
liberally plied himself with scotch and chicken patties pro¬

_____

—and

the SEC gets up at one

Trading in Metal Futures—Julius B. Baer

KNOWS

loss of $22 million in 1946, writer decries

of public.

If you are one

—

enough laws to handle fraud

are

for protection

Essential to Marshall Plan

Revived Germany

and brokers suffered

Investment Companies Bought in June Quarter

ASK ANYONE WHO

Commerce Department's report that, despite gen¬
widespread prosperity, the incorporated securities dealers

eral and

Exchange

Curb

York

Exchange

Cotton Exchange

Commodity
Chicago

Stock

Exchange,

Board

New Orleans Cotton

Inc.
Trade

Exchange

And other Exchanges

N. Y. Cotton Exchange Bldg.
NEW
CHICAGO

country besides the SEC to handle cases of fraud and

YORK 4,
DETROIT

N. Y.
PITTSBURGH

GENEVA, SWITZERLAND

(Continued under "Securities Salesman's Corner" on page 20)

RIGGS, Business Manager

Thursday, Aug. 21, 1947

TITLE COMPANY

Every Thursday (general news and ad¬
vertising issue) and every Monday (com¬

CERTIFICATES

plete

statistical

records,
ctate
;

Corporation

and

Other

city

3,
Drapers'

land,

c/o

—

market

news,

Offices:

Chicago
1

issue

quotation

bank clearings,

135

Salle

St.,

111.
(Telephone: State 0613);
Gardens, London, E. C., Eng¬
Edwards

Coypright
Reentered

<fe

Smith.

by William
Company

1947

25, 1942,
York, N. Y.,
3, 1879.
f

ary

Mtge. Guar. Co.

Dana

post
the

office
Act
?

High Grade Public Utility and Industrial

Spencer Trask & Go.

Prudence Co.

Members

Newburger, Loeb & Co.
New

York

Stock

New

York Stock

S.
of

15 Broad

St., NX 5

Bell

Teletype

Tel.:

HAnover

1-2033

Members

New

York

135 S. La Salle

Curb

Exchangt

St., Chicago 3

Teletype—NY 1-5
Albany

Boston

Glens Falls

Schenectady

C. E.

Worcester

request

Unterberg & Co.

Members N. Y.

Security Dealers Ass'n

61 Broadway,

Tel.: Andover 4690

2-4300

Exchange

WHitehall 4-6330
NY

Exchange

Broad Street, New York 4

Corp.

4% Conv. Preferred
Analyses on

Subscriptions in United States, U.
Possessions. Territories " anq Members
Pan-American Union, $35.00 per year;

& Trust Co.
Rome Cable
K.

New

Members

Textile, Inc.

Public National Bank

PREFERRED STOCKS

Co.

March

Subscription Rates

Stern & Stern

interested in offerings of

Lawyers Title & Guar. Co.
N. Y. Title & Mtge.

•

are

Lawyers Mortgage Co.

second-class matter Febru¬

the
under

at
-

Bond &

etc.).

New York 6, N. Y.
Green 9-3565

Telephone BOwling
Teletype MY

1-1666

THE

(716)

Wviui & €0.
is?

COMMERCIAL

FINANCIAL "CHRONICLE

BUSINESS BUZZ

Trading in Metal Futures

V*4-

By JULIUS B. BAER* ~
General

Counsel, Commodity Exchanges, Inc.

Mr. Baer reviews progress of inaugurating and broadening the fu¬
tures metal market in New
York, and the importance of having
New York replace London

world metal trading center. Explains functions of the futures market and the value of hedging
as

Abitibi Power

belief

Congress will end "Silver Follies of early 1930s."

Aspinook Corp.
Brockway Motors

enough

12>
been

be¬

the tech¬

cause

nique

Buda Co.

fu¬

the

exchange

one

name

Commodity

Exchange, Inc.

trading
developed

was

Diebold*

these

N. Y.

Center

ods

Fairbanks Co.*

the

mch

for

the

marketing and
a

g r

Lanova*
Julius

Liberty Aircraft Prod.
Majestic Radio & Tel.
Michigan Chemical
Minn. & Ontario Paper

which
trial

War I

rest of the

and World

the

were

number

materials

raw

would

never

be¬

strong
natural
advantages en¬
joyed by New York in the metal

were

United

technique of futures
trading was applied in this coun¬
try to a rapidly mounting number
of
other
commodities,
among

Moxie

However, field. *
;
Metal consumption in the United
during
the
period States had long outdistanced the

Baer

between World

War

markets

the world metals

needed.

Lawrence Port. Cement*

early conviction that without

possible to wrest supremacy
trading center
away
from London—despite the

of
ultural

futures

come

financing
crops

metal*

of '

trading in New York is based

modern meth¬

General Machinery
Gt. Amer. Industries

World Metal Trading

Development

when

ago

com¬

modities years

Elk Horn Coal

such

one-third
zinc

Normally, the

accounts
world

consumption,

thirds

indus¬

world

for

about

nearly

tin

and

copper

two-

consumption

and about 25% of world lead

rub¬

world.

States

con¬

sumption.

Similarly, the United
ber,
hides and the four non- States has long been a dominant
ferrous metals: copper,
tin, lead factor in the mining and refining

Nu-Enamel

and zinc.

Philip Carey

time silver also

one

belonged

modities,

Polaroid

this

but

group

its

Purolator Prod.*

short

the

direct

New Deal silver

Rockwell Mfg.
Stand. Fruit & Steamship

Sterling Motors*

Copper

J. P. Stevens

came
was

cut

result

ing

T&ca

the

terminated
Silver

which

Taylor-Wharton*

1928

non-ferrous

metals.

Our

nor¬

ception—as
this

country.

"I hope you don't mind this
inconvenience, Miss
-the chair my clients
usually sit in is being

De Lacey
reupholstered!"

tin is produced in

Moreover,

our

South American neighbors account
for
an
additional

large

part

Interest Rate Possibilities

Metal

silver in

silver

in¬

was

1931.

and zinc followed in 1934.

Stromberg Carlson

the

mal share in world production of
non-ferrous metals ranks from 25
to 33%.
Tin, of course, is an ex¬

Exchange. world metal production and mines
next in 1929.
Next are in much greater proximity to

the National

In line

as
was

policy of the '30s.

Trading in tin futures
augurated in New York
on

com¬

career

American futures market

futures

following
Purchase

destroyed

had

Lead

Despite these advantages, Lon¬

Trad¬

passage of
Act of 1934

the basis for

By SIGURD R. WENDIN *

President, Heber, Fuger, Wendin, Inc.,
Detroit, Mich.

New York than to London.
don
in

was

able to maintain its role

dominating

market for two

established

the

world

futures

metals

its well-

reasons:

markets

for

country copper, silver, tin, lead and zinc,
when a tax was imposed on all and its equally well-established
reputation then as the world's
profits resulting from transactions
greatest center of international
in silver.
Meanwhile, in 1934, the finance.

Time Inc.

Tokheim Oil Tank

National

U. S. Air Conditioning
United Artists*

Met^l.-

Exchange

—

tor

gether with the New York rubber,
hide

.United Drill &Tool"B"

and

.....

those

War II,

days, >1 before,

World

number of other

metal

exchanges—had futures exchanges existed on the
Continent—in France, Holland and
by Mr. Baer at the Germany—but these played only

silk

*An address

by the Asso¬ minor roles.
Commodity Exchanges
When the metals went to
war,
and
Allied
Trades, New York futures trading stopped automatiCity, Aug. 14, 1947.
(Continued on page 28)

Seminar

Vacuum Concrete*

ciation

Warner & Swasey
Wurlitzer

sponsored

Investment Counsellor reviews
background of interest rates since
out factors affecting interest rate
changes. Sees '
present pressure for higher rates in face of
government opposition,
because of increased demands for business and
mortgage credit, '
but asserts it is foolish to hold government is powerful
enough to
dominate money market. Advises
mortgage companies acquire
FHA loans, when available.

1932, and points

free silver market in this

Textron-Pfd. & Wts.

into

merged

under

tures

Cinecolor

■

[

Most of you, probably, are accustomed to thinking of
commodity
futures markets only in connection with
grains and cotton. That is

American Hardware

•

operations to metal buyers. Decries ending of free silver bullion
markets by the Silver Purchase Act of 1934 and the 50% penalty
tax on profits derived from transactions in silver bullion.
Expresses

Alabama Mills
(

Interest rate possibilities are
related to government
fiscaLpolicy
and program, and will be, the
major determinant, of the rate of return
o n
s b u n d

credit

instru¬

ments

wheth-

they

Amer. Gas & Power
Cent. States Elec. Com,
Cumberland Gas

gov

Budft tympany

cial

Circular

upon

debts

tion

Bought

Sold

sound

Members N. Y. Stock
Exchange and Other Principal Exchanges
115 Broadway, New York
105 West Adams St.,
Chicago

Telephone BArclay 7-0100

Teletype NY

are

managers
Sigurd R. Wendia

lend¬

t^jat in

Ward & Co.
EST

Wellman

Analyses

BROADWAY, N.Y.S

1-1286-1287-1288

Direct Wires To t
Philadelphia 6t Los Angeles

ENTERPRISE

HmrtTd 6111.

PHONES"

Buff. 6024

Members New York

41 Broad Street

•

this possibility

accurately

Co.

the

stated,

but

looked.'

the

extent

fore

the

Seminar ' of

f* # *

VfcuMrvV

subject to

managers

hardly

error.

human

are

Money

and

can

completely ' imrriune

from pressure of all kinds which
may be contrary to
sound long

long

point

range

discussing

conditions

; surrounding the demand and

ply of credit, it

gov-

sup¬

appears

appropri¬

ate to mention
that the

declining

interestj jrate trend which started
^with the late; Roosevelt Admin¬
istration, was not entirelv
re-1

the

National
Savings and..Loan
League ^t Mercersburg
Academy,
Mercersburg, Pa., Aug. 12, 1947.

I
tr

Executives

are

Before

over¬

;\*A lecture,by:Mr. Wendin be¬

New York 4, N. Y.

might consider doing obvi¬

ously

Declining Interest Rate
Trend;

Security Dealers Association
;

agers

certainly,
be

the

mortgages cannot be

possibilities cannot

involve rising interest costs which
is directly
contrary to short terip
policies.'
J
;
'
/
ijj

in determining

probabilities for long term inter¬
est rates

request

.INCORPORATED

Bon. 2100

Seligman, LuWtkin

REctor 2-8700
N. Y.

Tennessee Products & Chemical

Members HY. Security Dealers Am,

120

Engineering Co.

represented

of view to have
more of our debt
held by others than
banks, but tp
effectuate such a program would

tion in the last
depression, and
the weight which has to be
given

it would

Corpora¬

Osgood Company "B"

1926

government authorities. Assump¬
tions involving what the man¬

be better from

rowers, possibly along the lines of
the Home Owners Loan

Convertible Debentures due 1956

.logical,, would

range planning.
For example;
is agreed by most that

periods of stress the government
step in to protect such bor¬

would

Graham-Paige Motors Corporation

and

value if it did not
consider the attitude of the
money

necessities of life,
namely* .shelter,
it is
easily conceivable

1-672

request

judging future credit
Now, with a con¬

questionable

ers, the social and political aspects
of the problem
cannot be over¬
looked. When a great
many bor¬
rowers who5 are also
voters, have
at stake one of the
fundamental

Goodbody & Co.

our

and

private

Quoted

economy

operations.

popula¬

Rockwell Mfg. Co.

relatively low.

trolled money
market, any supply
and
demand
analysis
however,

seg¬

ment

rate tend

1932 when

estimate for

largely held by

Standard Gas Elec.
Tide Water Pwr. Com.
or

Mfg.

Philip Carey

El Paso Electric

! Puget S'nd P. & L. Com.
Southwest Natural Gas

•Bulletin

be¬

mort¬

large

risk,

pective demand and supply credit
factors, and come to a satisfactory

credits.

repre¬

the

the mortgage

a reasonably
prevailed, it was
relatively simple to analyze pros¬

free

commer¬

sent

Oxford Paper Com. & Pfd.

Durez Plastics & Chem.

Federal Water & Gas
New Eng. Elec. System

;

Before

gages

General Machinery Corp.

to remain

ment bonds

cushions

turn will

mortgages,

cause

Art Metal Construction

ernment

However,

Thursday, August 21, 1947

(Continuati

'
i

-W

«#•*#

on
I

A'i

21)

page
if

«..K

;
.*•

-f

Number 2622

Volume 166

THE

Steel

■

The

Production

COMMERCIAL

FINANCIAL

President, New York Coffee and Sugar Exchange

Reta,il Trade

Industry

Business

insurance to

has

J
While total industrial production continued to reflect

futures trading inaugurated in December, 1914. Stresses value of sugar
all concerned in sugar transactions, and points out New York Coffee and

ment of sugar

Failures

made sugar

now

exchanges '♦>

•

again in July,

by 2,500,000 over,

a year ago

wih total civilian

the

import

commodities,

em¬

rub¬

such> as

ployment up by 2,225,000.

ber,
cocoa,
silk, pepper,

declined by almost 2%
and scheduled output the current week, according to the American
Iron and Steel Institute, will be at 92.8% of capacity, or a further
decrease of 0.4%. The extreme warm weather adversely affected pro¬
duction and thus increased demand further for sheet steel and steel
Steel ingot production the previous week

•

not

trad¬

facilities

ing

second consecutive month, despite a moderate slump in
agricultural employment. It is further reported that the total civilian

will agree that it is
to study exhaus¬
tively
all the commodity
exChanges in order to get a good
grasp of their functions and meth¬
ods
of
operation.
If a student
masters the workings of one of
them, he will have a good under¬
standing of them all.
.
Therefore, at the risk of incur¬

provide I believe

that

futures

jobs for the

of this meeting will show that I am scheduled to cover the
Import Commodity markets. When I first received the assignment, my impulse was to go
to the public library and delve into the history of the various organized commodity
Reference to the program

the Census reports. For the week ending July 12, there
60,070,000 workers on civilian payrolls, representing 60,000,000

labor force

Introduction

•!

the Bureau of
were

lessened |

markets of world a homogeneous whole. Holds Exchange has materially
aided financing of growing crops and warehouse stocks.

advance

week the increase was a rather minute one owing to limited
supplies of certain raw materials and a dearth of some types of
skilled labor. The condition of employment for the country as a
whole continued at a very high level, but labor disputes showed a
moderate upward swing as unions essayed to test the provisions of
the Taft-Hartley Act.
'
; ; \ j
employment smashed all records

futures as price %
Sugar Exchange I

costs of distribution and has

the past

civilian

develop-;?

York Coffee and Sugar Exchange, Mr. Gardner outlines

After tracing organization of New

Auto Production

Commodity Price Index
Food Price Index

Total

C. GARDNER *

By JOHN

Carloadings

and

Sugai Future Trading in New York

■**

Electric Output

State of Trade

(717)

CHRONICLE

coffee

and

sugar;

and

you

necessary

more
sons

compelling and specific rea¬
leading to the formation of a

Exchange,

definite organization or

but the essentials of the idea were

already

there,

because it is also

recorded that trade pract ces very
similar to a "futures"

market were

The coffee import¬
ers
and merchants of that time
were faced with the same-prob¬

operation.

ring Mr. Higgons' displeasure for lems as our present-day mer¬
Their customers wanted
departing somewhat from my as¬ chants.
parts which were already in short supply.
'
all
briefly. signment, I have chosen sugar as to purchase for future delivery,
A serious handicap in the production of much-needed steel is to
and it was up to the merchant to
Upon
reflec¬ my commodity and the New York
make the sale and then protect
be found in the present scrap metal situation.
Shortages of such
tion, that ap¬ Coffee & Sugar Exchange, Inc. as
himself as best he could against
scrap metal necessary to produce iron and steel have reached a criti¬
proach seemed the futures market for discussion
a
cal position, especially at a time when reserves against fall and winter
rising market. Or, perhaps the
wrong.
I am this afternoon, since my entire
John C. Gardner
merchant and roaster had to accu¬
demands are usually built up. Further, current consumption of pur¬
not
experi¬ business career of 28 years has
chased scrap is 2,200,000 gross tons per month, an all-time high, while
been with firms engaged in the mulate stocks at times in antici¬
enced
in research; I am not a
inventories of consumers and dealers are at an all-time low.
pation of the future demands of
historian, nor do I make any pre¬ importation, sale and distribution
With the rising cost of living pushing prices ever higher into the
customers, and then protect them¬
tenses to being an economist.
I of raw and refined sugar, and selves if
ethereal blue came word last week from Attorney General of the
they could agamst a fall¬
could copy from the various text¬ trading in sugar futures on* the
United States, Tom C. Clark, to the effect that he had given instruc¬
books the enumerated
economic Coffee & Sugar Exchange. I stand ing market. * Sometimes specific
tions to the anti-trust division of the Department of Justice to look
before you, then, not as a theorist shipments suffered loss at sea, or
functions of a futures market and
A merchant,
into the situation and determine whether conspiracies exist to main¬
able to trace out all the economic boats were delayed.
after reading them to you the re¬
effects
of
futures trading,
tain or increase prices in these fields. Previous to this announce¬
but under those conditions, in order
sult would be merely an echo. You
ment, Emil Rieve, Chairman of the CIO's full employment committee, would know but little more than merely as an ordinary practical to make good on his promised de¬
demanded of President Truman that he call a special session of Con¬
mechanic trying to explain some livery, would turn to other local
you
know about our Exchanges
of the common, everyday uses of merchants and acquire the needed
gress to restore price and rationing controls to cope with rising prices,
here in New York. Many of the
goods. For these and many other
but the President has shown no inclination in that direction.
textbooks to which I would refer one of the tools of my profession.
t
reasons, all quite logical and cornLumber production for the week ended Aug. 2 declined slightly
were
written by guests present
History
with output amounting to 198,821,000 board feet. Lumber shipments
continued on page 30)
here today.
,
were almost
7% below production while unfilled orders amounted
Our Coffee & Sugar Exchange
The sensible approach appeared
to 72% of stocks.
A
1
was
organized in 1882, first as
to be to choose the one commodity
Civil engineering construction also showed a falling off and was
the "New York Coffee Exchange,"
AMERICAN MADE
and the one Exchange about which
48% below the level of the previous week as volume totaled $57,401,and trading was confined to the
MARKETS
IN
I- know; the most.
Many of you
000. Private construction amounted to $24,425,000, or 49% below the
one article.
Its formation, accord¬
gentlemen who understand thor¬
level of the week preceding.
'
'
r
1
CANADIAN
l~
ing to one account, was due largely
oughly the theory of futures trad¬
Clothing production was at a high level the previous week but
to the disorganization existing ir
ing may not be familiar with the
^SECURITIES/
was impeded by a lack of experienced labor and several types of
the spot coffee trade as a.result
cloth. Work clothing and hosiery production increased. Shoe output practical everyday business opera
of overproduction, falling prices
tion of a given Exchange; there¬
also rose and order backlogs for medium-priced shoes expanded
and the failure of a syndicate tha^
Abitibi Power & Paper
fore, if I stick to down-to-earth
considerably.
'
•:
'■ <V . ■:
/■;
■ *.
- •••. <•
■
had tried to maintain a monopob
;
Industrial chemical production continued on an accelerated scale cases, without any flights into the
Brown Company
the preceding years.
It
realm of theory, I stand a better during
but paint output remained insufficient to fill the very large demand.
was
an
attempt to bring order
ichance to impart a little informal
Consolidated Paper v
Although the number, of business failures has grown consistently
but of chaos; to stabilize prices
larger, month by month, since V-J Day, it continues to be well below Ition that is new to you, and per¬ by broadening the, market and
1
Electrolux Corp.
prewar levels,; The 299 concerns failing with losses to creditors in
haps contribute a* mite to our offering protective hedge facili¬
:... -I.;*.
> y
July Was'slightly1 above the June figure of 283 and four, times the
ties to growers, roasters, and deal¬
Minnesota & Ontario Paper
^thinking here today.Furthbrmore
July, 1946, total of 74,: reports Dun & Bradstreet, Inc. In the corre¬
ers;'to establish definite grades
:
sponding month of 1938 concerns failing numbered 1,073. "
*An address by Mr. Gardner at and standards; to root out unethi¬
Noranda Mines, Ltd.
then endeavor

to cover them

■

•

„

sharp rise in liabilities since the end
of World War n with the total for July $37,137,000, or double
There has been

•

that of the previous

•

very

month and the highest volume of losses for
The average liability in July was $124,204

•

this month since 1932.

•J

compared with $43,565 in the corresponding

and $13,756 in July, 1938.

month a year ago
V

An increase in the number of large concerns

Commodity Mar¬ cal trade practices and set up
keting and Distribution, under the machinery for the arbitration of
auspices of the National Associa¬ disputes;* and to collect and dis¬
tion of Commodity Exchanges and seminate accurate and useful trade
Allied Trades, Ir^c., New York statistics and market information.
These are perhaps some of the
City, Aug. 14, 1947.

ia Symposium on

failing pushed up

HART SMITH & CO.
HAnover 2-0W0

WILLIAM ST., N. Y. 5

Bell Teletype NY

1-395

Toronto

Montreal

New York

Businesses failing with losses of $100,000 or
41; of these, four involved liabilities in excess of a

the July liability total.
more

rose

million dollars.

Portland Genera! Electric Com. WD

STEEL PRODUCTION DECLINES SLIGHTLY FOR
The

American

Iron'

and

Steel

WEEK

Institute hriftoiinced on

Portland Electric Power 6s,

Monday

operating rate of steel companies having 94% of
the steel capacity of the industry will be 92.8% of capacity for the
week beginning Aug. 18, 1947, as compared with 93.2% one week
ago, 93.1% one mcnth ago and 89.7% one year ago. This represents
of this week

the

decrease of 0.4 point, or

1,629,200 tons one month ago, and 1,580,900 tons one year ago.

The Federal
steel

Trade

Commission laid its heavy

Bought—Sold—Quoted

SUGAR

spiracy and multiple basing points.
(

;

FREDERIC H. HATCH & CO.,
Established

price con¬

The attack was aimed at the
1924, accord-

multiple basing point system used in steel selling since
:•"*

Raw—Refined—Liquid

artillery on the

industry this week and let fly with a mighty salvo on

STREET

NEW YORK 5. N. Y.

'The week's operating

; ago,

WALL

Transmission

Tennessee Gas &

0.4% from the preceding week.

rate is equivalent to 1,623,900 tons of
steel ingots and castings compared to 1,630,900 tons one week

LAMBORN & CO.,Inc.

1950

MEMBERS N.

63 Wall

Exports—Imports—Futures

DEALERS ASSOCIATION

Y. SECURITY

Street, New York 5,

INC.

1888
DIgby 4-2727

Bell Teletype NY 1-897

N. Y.

(Continued on page 24)

Specialists in

York, New Haven &

New
U'

;

t::

h'»

Portland General Electric
(When Delivered)

:it"

Hartford

Letter Available to

Stock Exchange

Philippine Mining

Reorganization Plan
(Newly Adjusted Security

Bulolo Gold

Allocation)

Kerr

Far East

Vilas & Hickey

Stryker & Brown
50 BROAD ST., JtfEW YORK 4, N Y.

Tel.

HAnoyer!2-3970

—7

Teletype NY 1-1582

Dredging, Ltd.
Addison

Big Wedge

Dealers upon Request

Contracts

Members

Neto

New

Stock
Curb

York

Members

York

62 William
-

New York 5, N.

Telephone: HAnover 2-7900
Teletype:

NY 1-S11

Mines
Oil

MAHER & CO.

Exchange
Exchange

49 Wall Street

and
Issues

Domestic, Canadian

Y.
.

Tel.

St., New York,

WHiUhall 4-2422

N. Y.
..A

Branch Office

113 Hudson St.,

Jersey City, N.

THE

(718)

COMMERCIAL

FINANCIAL

Bietton Woods in

European Recovery Vital: Marshall
Secretary of State tells Rio Conference U. S. has assumed heavy
burden in effort to meet minimum economic requirements of Europe,

Americas.

vital to the

rehabilitation

whose

CHRONICLE

Thursday, August 21, 1947

Retrospect and Prospect

By DR. F. A. G. KEESING*
Professor

Monetary

Advisor

Upholds theory

Theory,

to Ministry

prepared scheduled address before the Inter-America De¬
at Quitandinha, Brazil, on Aug. 20, Secretary of

<$>

Marshall
of

rehab¬

ropean

ilitation

tal

Eu¬
vi¬

the

in¬

the

terests

Americas, and

boldly
de¬
nounced' limi¬
tations

upon

-indi vi du

freedom based

the fhe-

upon

that

ory

exists
George C. Marshall

man

for

the

State.
"The

grave

world today are largely due to the

disruptions

"The

Marshall

extent

much

and

social

the

East

sphere.

normal

stated.
this

than

confusion
in

Europe

this

hemi¬

Our

problems are longpeacetime problems requir¬
ing more intensive economic plan¬

range

ning for the
the

tools

efficient

the abundant'

production

odds."

prise,

the

ernment

ican

resources

and

Pan

intelligently

Drug

STEIN BROS. & BOYCE
6

and

other

the

assuming

have not lost sight
economic problems of the
we

matter

Baltimore

Stock

leading exchanges

CALVERT

ST., BALTIMORE
Bell
Teletype BA 393
New York
Telephone EEctor 2-3327

(Continued

32)

page

p r e d ecessor.
Everyt h i n g
a

con¬

the

ruption

Keesing

ern

and

dis¬

since

applicable

weapons, the longer duration
the greater territorial exten-

resources

BOSTON

its

present situation, but raised
to the n-th
degree. As a result of
the greater effectiveness of
mod¬

economic questions with its sister

"The economic problems caused

times
destruc¬

to the

economic

emics,

1918 is equal¬

for practical cooperation. Each o
our countries must do its
part in
the achievement of this goal.

and

military operations,
certainly not lastly as a re¬

sult of the advanced

technique of

intervention, economic
have this time been de¬

stroyed to

unprecedented de¬

gree.

connection

brought

importance

B<m

ions1 in which international pay¬
intercourse is caught is of

that

has, to put it bluntly, to be re¬
as
paupers
who are
a
burden internationally. The num¬

garded

ber -of countries which will

about

the

balance

'are

afflicted

payments

ute

Connolly & Co., Inc.

PHILADELPHIA

activity

liquidated

behalf

the

war

tion

the

world's reconstruc¬

labors."1

Advantages

others do

many

contrib¬

ness

observe

clearly

Fund

live

and

defined

rules

to
their

mutual

possibilities to make the economic

expressly

tion without which

Nations

international

coopera¬

results

can

success.

the means through which they are
will, in the first
of importance for its prepared to contribute to postwar

the world which
prove

solution.

recovery.

problem of Bretton Woods
therefore

must

also

regarded

against this background.
What

now,

connection with

first .place

be observed

can

the

Fund

the

light

in
the

the

This does not mean that various
serious objections cannot be raised

against the Fund.
exchange parities,
the

fixing of-

which has in
taken place, has

meantime

undoubtedly

The

too

come

soon

128

Telephone
RIttenhouse

LOUISVILLE

Teletype

6-3717

SPARTANBURG

American Air Filter

sterdam,
Amsterdam,
Holland
12, 1947,' The first part was

Fund and that fundamental anal-,
yses

comings
in

Textile Securities

Girdler Corporation

Murphy Chair Company

AND

75 Years

Co.

Properties
rat

BANKERS BOND £2i
Incorporated

1st
>

Floor, Kentucky Home Life
Bldg.
LOUISVILLE 2, KENTUCKY

Long Distance 238-9

Bell Tele. LS 186

L. D. 51

Memos

S. C.

SERVICE

Teletype 8PBG 17

N. Y.

1872

194 7

Hagerstown, Md.

New York and

3-7253

Los

Angeles

financial
of

this

the

first

opportunity

themselves

the

sub¬

The text of

sequently parliamentary

other

detailed criticism

Albert Frank

STANDARD SECURITIES
CORPORATION
of

Guenther Law
Incorporated

Exchange

Spokane

was

NBW YORK

Yakima, Wn.

PHILADELPHIA

CHICAGO

Branches at
and

its

advance some coordination in this

which

the

foreign

strictions which

are

must

be abolished

most

certainly

BOSTON

SAN FRANCISCO

the

currency
re-'
stll tolerated !

principle is,
short. In ac¬

too

would

mistaken, the
have

ma¬
a

structure of the Fund which would
have been different in several re¬
agree¬

aim
of

set

the

itself

balance

payments could be in equilib¬
in 1952 as far as Holland is

Apart from

probability

that

the

very,

this

aim

will not be achieved, the circum¬
stance that this partial
equilib^

rium

itself is founded

on the as-]
continued foreign'
control must fee taken •

sumption of
,

items

rium

likely

preferred

the

with

current

concerned.

not

currency

a
compromise into consideration and also the
original
plans of fact that no attention is
paid to
Keynes and White in which, how¬ the
redemption obligations which';

ever,

the

the American element pre¬

vailed

strongly.

England,
suppleness, the broad¬
er
basis and the slighter ties to
gold which the Keynes project
advocated, were appreciated in
the greater

Holland.

Dealers
Underwriters
Peyton Building, Spokane

Kellogg, Idaho

has

use

right to object to a parity declared
by a member; no attempt has
therefore been made to achieve in

prac¬

between

other hours.

•

Fund

made

by the Central Planning Bureau;,

agreement, which could only
accepted or rejected, was al¬
ready laid down at that time. Con¬

constitute

Brokers

the

case

ment"

Exchange from 10:45 to 11:30
A.M., Pac. Std. Time: Sp-82 at

Members Standard Stock

that

single

cordance

The" "articles

and

Private Wire System
between

Philadelphia,

have,

spects.

Immediate Execution of Orders
Quotes call TWX Sp-43 on Floor

Los Angeles

Telephone—WHitehall

and

causes

Request

Exchange
Walnut Street,
Philadelphia 2
Pa.

trade

For

New York,
Philadelphia
Los Angeles Stock
Exchanges
Also Member
of
New York Curb

Pittsburgh,

barely encountered

The

absorb

If I

NORTHWEST MINING
SECURITIES

BUCKLEY BROTHERS

1420

Dutch

Netherlands
to

ADVERTISING

Members

New York

were

ject under discussion.

the

jority

Son, Inc.

Monetary

ticklish question.
It is rightly
omission, if one can call it such,
feared that in future the difficult
are
very clearly reflected in the
ties of over- and underestimated
parliamentary deliberations de¬
currencies will occur as before.
voted to this subject in December
The period of five years within
1945.
After their liberation, the

SPOKANE. WASH

Eastern Corporation

markable

the

(Established 1892)

SPARTANBURG,

of its possibilities and short¬

tical value.

Southern Production Co.
Bird &

merits

place, hardly had

A. M. LAW & COMPANY

PHILADELPHIA

;

the

with

journals.

Consider II. Willett

Varnish

June

Southern

American Turf Ass'n

Reliance

serve
as a
lasting basis for pay¬
foregoing?
It has been noticed
ment Intercourse which will pres¬
that public
opinion in Holland
ently take place freely. It is re¬
has occupied itself but sparingly

published in last week's "Chron¬

Federal Street, Boston 10
Tel. Hubbard 3790
Tele. BS

^Translation of final part of an
address by Dr*
Keesing at an As¬
sembly of the University of Am¬

icle."

Stock Exchange Bldg. Phlla. 2

expected in the present cir¬
Irrespective of which
In the second place
international economic problem is cumstances.
broached today, it is always the the Fund, which enjoys the favor
relations
between
the.
United and protection of the United Na¬
States of America and the rest of tions, must be regarded as one of
a

have been

OFFICE

States

'cooperation of the United

ital claims have become
valueless

Byllesby & Company

"The Economist" sum¬
its point of view as fol¬
lows, somewhat crudely perhapsbut plainly: "If an answer has to
up

worlid recovery in a deci¬
currency relations.
The
manned, there remains but harmony which came about autocountry which possesses both matically with the classical gold
material
and
the
financial standard is hereby replaced by an

The

war

of pol¬

essentially

same.

med

never

sities to many times their
prewar
size. Extensive international

through

and

not possess the means to

the

situation

England/

lack

was

The advantages offered
regain their lost pros¬
by the
In the first
perity by their own strength is Fund are obvious.
legion; the reconstruction of our place, it is of the greatest signifi¬
ravaged world cannot be achieved cance that more than 40 states4
other than by international suc- have, by virtue of an agreement,
jcor and cooperation, Where many given expression to their willing¬

has

cap¬

H. M.

case

be able to

war

the

be given now, and if it
must be
stringency which is sufficiently Yes or No, it surely cannot be
explained by the urgency of the No. The dangers
are certainly \
balance of payments problems.
not great enough to
weigh in the.
In this postwar chaos a large scale with the dangers of repuls-\
part of the former belligerents ing the assistance of the United-

Warner Company

Traded in Round Lots

the

was

ment

Cement

Sterling Motor Truck

Preferred

the

hope.

there

place,

Nazareth

Walter J.

time reduced the
export possibilites and increased
import neces¬

Pittsburgh Rys. Co.

Boston & Maine RR.
Prior

currency is alarming;
network of currency restric-

one

many years, is upset more thor¬
ever. In innumerable
countries the war, by its destruc¬
tion and exhaustion of the
pro¬
duction apparatus, has at the same

Empire Steel Co.

foreign

this

oughly than

Empire Southern Gas

equilibrium, disrupted already for
Botany Mills

sive

What

which

American Box Board

and

reserve

ernment will continue to take

sound basis

was

them through the loss of their
capital incomes. The general lack

war

cerning

siveness

this

possibilities

this agreement.
The
therefore accepted
by
both Chambers with a mixture
t>£'
draft

where

economic

fact, the economic rehabilita¬
tion of Europe is vital to the econ¬
omy of this hemisphere.
My gov¬

republics and seek

status

further

aloof from

escap-

above

and

war

debtor

saw

ex¬

rem

starvation

for

tnanner

which

traditional creditor

pf financing their imports

many

de¬

Common

Exchanges

this burden

Western Hemisphere.

Lighting

with

and economic chaos.

Company

Common

Members New York

threatened

countries

status

first
war,

tive' than

requirements

devastated

areas

now

Class A & B

Vermont

economic

mum

the

The

followed

development
this productive capacity.

termined effort to meet the mini¬

Terminal

effort.

changed their

the efficient and fair

in-

the

was

Amer¬

applied

direct heritage
world

gov¬

Union, the World Bank and
be

which existed in 1939 and which in itself could be
regarded',

(International Monetary Fund,
must

large ex-<>-

tent

international

the

our

unusually heavy burdens in

Jacksonville Coach

"The government of the United
States of America < has assumed

BALTIMORE

Emerson

disorganization

posal with which to raise the gen¬
eral
standard
of living
of this
hemisphere.
The resources and
technical skill of private enter¬

Bayway

The

dis¬

our

Monetary Fund

can be no doubt that the Fund and the
Bank, with their ambitious aim, will;
fight what British Army bulletins, used to describe so
significantly as "terrible

have to

and

resources

There

use

,•

Continuing analysis on the Bretton Woods Agreements, published in last week's
"Chronicle," Prof.
Keesing points out present disorganization of European economy and postwar chaos will
prevent Inter¬
national Monetary Fund from
achieving its objective of establishing lasting international
monetary
equilibrium. Expresses doubt Fund has means to re-establish equilibrium and foresees
continuous
scarcity of dollars for many years even under liberal loan grants by U. S.-

relations,"

marked

agencies such

political problems confronting the

complete

and

Secretary

the

stressed
need

economic

Amsterdam

The Problems and Difficulties Facing the International

Conference

George

Holland
4

"state exists for man."

fense

University

of Finance,

Nevertheless there could

doubt

circumstances

that

the

Holland,
practical

idealistic

and

could

afford

not

given
both for

hold

will continue to
the
balance
of

cause

deficit in

capital.
It
can
therefore be predicted with a fair
degree of certainty that Holland
will

not be

her

currency

the
be

able to dispense with,

restrictions

within

stipulated

time limit; it may
this problem is
(Continued on page 32)

assumed

that

reasons

herself

1 "The

Economist,"

July

21,

1945.

THE

Number 2622

jVolume 166

COMMERCIAL

FINANCIAL

More About Sun

From

Washington
Ahead of the News

(719)

CHRONICLE

Spots and Economic Cycles
By DANIEL PINGREE

Writer, commenting on his previous article in the "Chronicle," explains limitations of the sun-spot
theory of business cycles. Points out other factors in human affairs may disturb accuracy of the
theory. Holds* working out of theory may be disturbed by use of currency rather than gold prices
in price indexes, and concludes mere chance may set off the chain reaction characteristic of cycles.

By CARLISLE BARGERON

C—Vancouver buried its mayor the other
On May 29, 1947, the "Commercial and Financial Chronicle" published a short
apparently a much beloved public servant. The newspapers de¬ article of mine on sun spot cycles and
prices of the common stock of the Erie Railroad.
voted almost as much space as we gave to Roosevelt's death Thou¬
This article has brought a number of letters, including one from a minister in California
sands of people stood on the streets as the cortege passed, the pro¬
JL
1 ; 1 - *
who
wanted
cession ^was a mile long.
It is evident that the Roosevelt
to
use
sun
B.

VANCOUVER,

day,

that the

What impressed the writer, however, was

spot theory in

The
politicians

genuine.

dle Africa. All of it is to be planted
in peanuts and by 1952 the Gov¬

walked
afoot did so
with bowed
who

c e e

Colonies, mostly those of Africa.
Cotton and tobacco plantations are

its limitations,

expected to predominate.

to correct any

■covered

Bargeron

Carlisle

from the funerals
politicians that I have
a reporter.
There is

any

political

On some

of the more

auspicious

which the deceased
rates a special train there is little
disguising of the gayety and hard
occasions on

drinking.
This was particularly
on the train that took Sena¬

'true

majority
leader, to his home back in Arkan¬
sas. Amid the Bourbon and "crik"
;water, as Jack Garner used to call
•it, the politicians schemed about
the

Robinson,

Joe

tor

a r

54-year cycle so far as

age

t i

Daniel Pingree

first

the
c

1 e,

it
to state that even

men.

Some

security

analysts, like the originators and
users
of the Dow-Jones theory,

black market in

gold comes nearer

arbitrary

than the

value

true

$35 an ounce figure at which the
physical and economic phe¬
sugar from Trinidad and Mauri¬
nomena,
let alone psychological, base themselves firmly on this government buys, but does not
tius, cotton from Uganda, and more
there
are
other cycles
besides generalization; and keeping them¬ sell, gold, then gold prices of
cocoa from West Africa which al¬
commodities now are actually less
those occasioned or accompanied selves studiously aloof from all
ready produces more than half
than they were at the bottom of
by sun spots, and many fluctua¬ questions of cause or exact dura¬
the world's supply.
the 1929-32 depression.
For gold
tions remain which cannot be ex¬ tion, merely say that once a trend
in the black market in certain for¬
Bacon and cheese factories have
plained by any cyclical theory is established, as evidenced by a
already been built since the war whatsoever.
certain event, then that trend is eign countries now sells for as
in Nigeria on the West African
This the¬
For instance, let us divide time likely to continue until a certain much as $100 an ounce.
Coast.
Meat packing plants have
other event occurs.
This type of
from 1863 on into 18-year periods,
oretical justification of the 54gone up in Tanganyika, Jamaica's
periods which have" nothing to do prediction1 is usually quite safe, year cycle provides cold comfort
production of sugar has doubled with sun
spot cycles.
It just so since once the pendulum starts to
to a speculator who has been com¬
and her tobacco crop has increased
happens that in each of these pe¬ move in one direction, it gener¬
so much that at present all of the
pelled by law to trade only in the
riods there are two depressions,
ally moves quite a way before its
cigars used in Britain come from
dollar value of commodities and
except for the last, which is not
there. Tanganyika has tripled its
course
is reversed.
To borrow
yet ended:
not in the gold value, and may
tea output and Kenya and NyasaPeriod—
Depressions terminology from the atomic not even own gold, except what
land have made smaller percent¬
1863-1880
1873,1878 bomb, a chain reaction is set up,
he can carry in his teeth and as
age gains. Harvest of timber from
1881-1898
1885,1894 one economic misfortune or suc¬
British Guinea in South America
ornaments on his person.
1899-1916
—1908,1914
and the Gold Coast and Nigeria
cess generating another, until the
Mere chance may set off the
1917-1934
1921,1929
in Africa has almost doubled.
whole world is affected.

mourning; little was said

gathered

would be well

—

•

—1937,

1935-1952—

are
hunting
bauxite.
Notwith¬
what was to be done with the Su¬ standing what we hear about ship¬
preme Court packing bill.
There ping shortages, the Colonies that
was

o n s

concealment of the
shenanigans before the
body is cold.
Congress gives an
escort to the home States of its
deceased members and it is in¬
variably selected of, members who
want to make the trip home for
a particular
purpose and in this
way their expenses are paid.

scarcely

been

Africa, manila hemp

Borneo, bananas from the
Cameroons, palm oil from" Malaya,

American

from

much different
Of

order

s s

that may have

from

was

and# in
impre

from Central

d,
though, to be.
It

have

does

mation, hopes to draw rice from
Sierra Leone and Borneo, tobacco

recent

between them, have provided
non-cyclical events, unless war
itself is cyclical, invalidating the

was

genuine.

are

Britain, according to this infor¬

knowing
whether the

Sadness

the

and

Administration
war,

the aver¬
speculator is concerned. Any¬
body selling commodities short
during the past few years would
found.
However,
it is not necessary Obviously .have taken a tremen¬
always to know cause to make a dous licking.
rough prediction of certain future
Gold Prices
events.
A
common,
and quite
And yet it is possible to show
true, generalization is that what
that if the 54-year cycle measures
goes up must come down, or as
Shakespeare more poetically put gold prices of commodities rather
than currency prices, and if the
it, "There is a tide in the affairs

spot

suggestive, but

way

Sun

told, is vot¬

genu¬

sad.

inely

jiave

parishioners.

theory is in¬
teresting
and

Parliament,

to sucd
him

seemed

v/ork with his

quarter pounds of peanut oil..

spots.

sun

tion, ozone,

ychological

ing $400,000,000 for industrial and
commercial development of the

Even
man who

hopes

p s

ernment hopes to get a billion and

heads.
the

Ultra-violet radia¬
atmospheric electric¬
ity, and certain other weather
phenomena
are
defnitely asso¬
ciated with sun spots; while with
18-year
cyclp,
or
with
many
others, there is no such associa¬
tion, or there has none as yet been

the

sorrow seemed

British

engineers

remained

out

characteristic

reaction

chain

May Be Misleading
implication is, of course,
cycles, but intellectually we are
from these series of figures that
As an example of how mislead¬ left unsatisfied by such a facile
there is going to be a depression
ing cyclical theories can be to an explanation.
Cycles are so com¬
sometime between now and 1952.
hands
average
speculator or investor, mon in all phases of our expe¬
Well, there may easily be such a

and

oil

coal,

enemy

The

had were said to be doing 50% more depression, but it cannot be proved unless
the
causes
behind
the rience,'and so readily interpreted
-rendered.
Several weeks later, a trade at the end of the war than from the series of figures given.
the
physical
and chemical
theory are thoroughly understood, :in
before, imports growing from $463
woman of a town through which
If, in walking down the street, and allowance is made for other fields in terms of certain funda^millions in 1938 to $718 millions
the train had passed, wrote Wash¬
it so happens that
every other
in 1945; exports jumped from $465
mental and simple principles, that
ington newspapermen asking if
man met is a red head,
and that cycles and for non-cyclical events,
millions to $678 millions. Colonies
she could be given the name of
the last man had black hair, there take the 54-year Kondratieff cycle it seems logical to expect that they
lost to the enemy have bounded
*the Congressman in the red bath¬
is no assurance whatsoever that of economic behavior, and specifi¬ can also be so interpreted in the
back into world trade.
robe who waved at her.
the next one's hair will be red.
cally
of
wholesale commodity economic and biological fields.
of

services the deceased

the

Western Canada, at

seem

dollar

she

give

American

This

apt

lot to Ameri¬

tobaccoy

cockeyed picture,
shortages, al¬

To add to the

which

has

it has

just removed the

days

behest of American

must be

Canada

part

week, at the
tourists, is ap¬

prehensive lest Britain's new aus¬
terity policy, will reduce British
trail is
purchases in this country. Canada,

out of

at every place you en¬
counter people trying to get hotel
or rail accommodations.
Insofar
crowded;

means

two meatless

ask for it.

a pretty penny
American tourists.
The

not

Canada

making

the change in
She certainly though

you

money.

Will if you
v

and

restaurant
will

this

All

about any cans who have cotton,
give your peanuts, etc., for export.
bill to the waitress at
You

shortage.

American
"the

least, doesn't

worrying

the Canadian dollar being some
tVz% cheaper than the American

; as

dollar is concerned, it means

noth¬

the

United

gives

States,

conclusion
statistics of
past experience is valid, unless
causation can be shown.
If there
is
a
plausible cause for a red
head following a black, that is a
different
matter, depending
on
just how plausible the cause is;
but if there is no such cause, then
the supporting statistics, no mat¬
ter
how
impressive,
must be
words,

other

based

purely on the

charged to coincidence.

The only advantage of sun spot
money to Britain to make
purchases in the first place; is cycles over others, so far as bio¬
and * economic data are
worried the merry-go-round may logical
concerned, is that plausible causes
end, or be sharply curtailed.
can be shown in connection with

lends

ment has been inferred
we

It is announced here also that
you buy your Canadian
in the United States.
In the United States has renewed re¬
Canada,- the dollars are looked strictions against Canadian lum¬
There had been no relief in
upon as interchangeable at face ber.
value.* Except when you go to the U. S. housing shortage when

centuries,

have covering many

well established em¬

pirically

any

guess

than

Recent

peaks

occurred

1925;

the years
the

some

an answer

proves

to the problem, or

definitely

that it is in-

solvable.

only
54 years With McMaster

1817,4 1871

in
If
continues, the next

and recent troughs

CHICAGO,
Schultz,

laney,

Chronicle)

H.
Mul-

ILL. —John

previously

with

Ross & Co., is now with
Hutchinson & Co., 105

McMaster
La

Salle, Street,

the Chicago

trough is due in 1952.

Hutchinson

(Special to The Financial

have

of; the cycle

1790, 1844 and 1898.

rhythm

finds

other number.

the years,

line,

can

at why it should be

rather

and

economic cycle

although

known,

this

along

continues

Work

from data and will continue until somebody

and seems as

the

ing unless

This 54-year wave move¬

prices.

members of

Stock Exchange.

money

'exchange Canadian currency, for I left a couple of weeks ago. Cana¬
complain,
too,
that the
American money.
Then there is dians
a charge of Vz of 1%.
Government Americans are underselling them

Artkraft

the law of supply and demand.

The newspapers here,

theme of "Don't sell Britain's fu,

ture. short," give some mighty in-

feresting

news

Government's

Socialist

the

plans for develop¬

ing her Colonies.

If true it doesn't

fit in with the bleak picture
"we

get of Britain at all.

told

that

movers

working

are

Tanganyika,
;
*

which

We are
earth

and

bulldozers

the

northern

soil

Rhodesia

and Kenya for planting purposes;

that

the

plowing

program
up

calls

3,100,000

for

acres

in lumber exports.

COMMON STOCK

under the

their

of Mid¬

allen r.

Limaf Ohio

j decree seems to have frustrated

touche, niven &

Manufacturing Corp.

smart & co.

& company

george bailey

of
Maytag
Home
Commercial
Beverage
&

co.

/Manufacturers

Bowser, Inc., Com. and Pfd.
Central Soya Co.
Curtiss

Companies,

Lincoln

National

Paper
^

Food

■

Life Ins. Co.

sales

establishing

new

and
earnings
records.

DAVID A. NOYES & COMPANY

Descriptive

to dealers

Tele. CG 730

ILLINOIS
Tel.: State 0400

only

231 S. La

Salle St.

Dearborn 1501

Teletype CG 955
_________—

PUBLIC

September 1, 1947

Touche, Niven,
NEW YORK

CLEVELAND

CHICAGO 4

SOUTH LA SALLE STREET

—CERTIFIED

partnership to

their practices as

ACCOUNTANTS—

under the name of

illustrated brochure

and

COMSTOCK & CO.

York Stock Exchange

CHICAGO

are

the formation
merge

Approximate price 2%

available

208

announce

;

'Current

Whiting Corporation Com.

Members New

Refrigerators, Liquid Vending
and
Outdoor Advertising

Signs.

Inc., Com.

Freezers,

Machines

Com.

Ft. Wayne Corrugated
Co. Com.

•

AUGUST

20,

•

CHICAGO

•

Bailey & Smart

MINNEAPOLIS • LOS

1947

ST. LOUIS • PITTSBURGH
ANGELES • SEATTLE • DAYTON

DETROIT •

(720)

THE

COMMERCIAL & FINANCIAL CHRONICLE
trie

units .are

around

currently

selling

over-the-counter

presumably

the

and

Potomac

new

Dealer-Broker Investment

Electric (when issued) would sell
around

the

appears

the

Potomac Electric Power

simplification
have

devised

been

subholding company. A final
plan received the approval of the
SEC on May 15, and of the Fed¬

why

Court

June

16.

the

then

retire

preferred stock will
be retired (when the
plan is de¬
clared operative,
probably in a
few weeks) by
exchanging each
share

for

one

new

reduce earning power.
The allowable rates of return on
the fair value of the
property was
from 6% to 5%%,
The
rate base was reduced

changed

for

common

each.

y/ould

take

Potomac
over

one

Electric

Potomac

Electric

about

common

amount

;

has

stock.

changes were
original order

assume

remaining liabilities.

any

was

the

new

drastic

appealed,

but

the

sustained

was

and

effective.

refunding
funds to customers covering
stocks,

its 6% and 5V2% preferred

issuing two shares

of the

new

$50

earnings

>vho wish to make the exchange.
were

Railway, the

will

Company

have

outstanding
debt, $11,250,preferred stock and 2,961,250

about
000

$44,000,000

shares of

common

Earnings
ments

been

and

pro

stock.

dividend

pay¬

forma basis have

follows:
Divs.

1946

Earnings

$0.97
1.05"*'

1944

$1.04

0.97 :

1945

1.09

1.06

1.27

1942

1.05

1.19

1941

1.20

1940

1.20

1.32

1.30

Potomac Electric Power

perhaps

two

three

new

stated

above

are

basis.

While it is difficult to make
any
exact
estimate, present earnings

eral

Clark
18

t i

Artkraft

La Salle

Also

and

available

Steel;
Products; Upson Corp.;

Fleetwood

Corp.;

available

illustrated

are

Air

Concrete;

Flow;
Lanova
Portland
Ce¬
Motors; Diebold;

Lawrence

ment;

Sterling

Sessions Co.

Graham-Paige

Motors

Corp.—
Lubetkin &
Co., 41 Broad Street, New York 4.

Analysis—Seligman,

bro¬

Street, Chicago 4, 111.

Eastern

had

York

are

United Artists; Vacuum

Lamson &

Bird & Son Co.—Memorandum
—Buckley
Bros.,
1420
Walnut
Street, Philadelphia 2, Pa.
Also

Co.—Circular—Ward

Broadway, New

memoranda
Taylor Wharton Iron &

New York.

Also

memoranda

Corporation

and

Southern Production Co.

available

are
analyses of
Company "B," Wellmau
Engineering Co., Tennessee Prod¬

Osgood

ucts

Aug.

& Chemical.

Marshall-Wells Company — de¬
memorandum—J, M. Dam
& Company, Rand
Tower, Min¬
neapolis 2, Minn.
tailed

crim¬

Brunner

suit

against

pany

eight

Tom

tires, the Tire Man¬
Association
and
ten

ufacturers

Federal

The suit

District

Southern

Court

District

filed

was

for

New

defendants listed

National Terminal Corp.—Mem¬

Manufacturing

memorandum

—

Com¬

Bond

Wall

ton

Company,

—Analysis—Ira Haupt & Co., Ill
Broadway, New York 6, Y. Y.
New York, New Haven & Hart¬

the

ford—reorganization

Canadian Pacific Railway Com¬
pany—memorandum—A. M. Kid¬

York.

are:

Street,

Chicago 3, 111.

Broadway,

New York 6, N.Y.

orandum for dealers
only—Adama
& Co., 105 West Adams

New England Public Service
Co.

C. I. T. Financial
Corporationdiscussion" and opinion—E. F. Hut-

individuals charging they were in
agreement to fix prices of tires
tubes.

—

Goodwin, Incorporated, 63
Street, New York 5, N. Y.

Clark

of automobile

The

chure—Comstock & Co., 231 South

manufacturers

and

"Per¬

Manufacturing Corp.—

Descriptive

informa-

ing, Detroit 26, Mich.

announced,

inal

& Co., 120
5, N. Y.

Company.

plan—letter

newly adjusted security alloca¬
tion—Vilas
&
Hickey, 49 Wall
Street, New York 5, N. Y.

appear

somewhat

der

below

the

5V2%
now
allowed.
The
Securities and Exchange Commis¬

—

tion

would

and current

running

have

been

earnings

only

appear to

slightly lower.

the SEC

95c

1947-

Britain to Suspend

Possibly

V \
•
Washington Railway and Elec-

Convertibility
to

ease

had

permission"
—

dom

QUOTED

West Virginia Water Service

Federal Water & Gas

Puget Sound Power & Light

^Indiana Gas & Water

Public Service of Indiana

Southwestern Public Service

*Prospectus

fort

all

The

Britain's

economic

granted
"emergency
to the United

King¬

suspend dollar payments
nations except the U.
S.

available

are
analyses on
Textile, Inc., and

Salle

mouth

Steel

Corp.

same

on
interesting spec¬
ulation—Troster, Currie & Sum¬
mers, 74 Trinity Place, New York

and

issue

Ports¬

6, N. Y.

Leland

Electric Company.
Trane
El

Electric Company and
Electric & Power Com¬

Co.,

135

South

Stearns

Salle

Chicago 3, 111.
Also available is

&
,

Street,

detailed dis-

Request

Co.—analysis—Loewi

Co., 225 East Mason .Street, Mil¬
waukee 2, Wis.

Paso

fective July 15.

memorandum

Street, Chicago 3, 111.

Also contained in the
are
brief
discussions

Cable Corp.

Stern

Reiter Foster Oil Corporation-

nett, Spanier & Co., 105 South La

suspension of the sterling con¬ Virginia
vertibility clause which, pursuant pany—analysis-^—Bear,

agreement, became ef¬

Rome

Commentator"—Ben¬

United Air Lin6s, Inc.—analysis
—Hayden, Stone & Co., 25 Broad
Street, New York 4, N. Y.
Utica & Mohawk

Inc.

—

Circular

Cotton Mill*

Mohawk Val¬

—

ley Investing Co., Inc., 238 Gw-

Paine,Webbek, Jackson & Cntns
Established

Also

Disticraft, Inc.—memorandum in

"Wall Street

concession, in effect, amounts

to the loan

N. Y.

Stern

was
officially announced in
Washington yesterday (Aug. 20)
that the United
States, in an ef¬

crisis,

SOLD

—Kalb, Voorhis & Co., 15 Broad
Street, New York 5, N. Y.

envisaged an upward re¬
adjustment of rates at the end of

one

—

Tom
on

issue

Allied Paper Mills—late data—
Moreland & Co., Penobscot Build¬

com¬

that he
filed

in current

the

& Co., 1 Wall
Rubber
Manufacturers
Corp.,
Street, New
Inc., New York City; the Dayton York 5, N. Y.
Rubber Co., Dayton,
Ohio; Fire¬
Pacific American Investors, Inc.
stone Tire & Rubber
Celanese Corporation of Amer¬
Co., Akron,
sion, in passing upon the Wash¬
—memorandum—Maxwell, Mar¬
Ohio; General Tire & Rubber Co., ica
analytical memorandum
shall
&
ington Railway plan, concluded
Co., 647 South Spring
Akron; B. F. Goodrich Co., Akron; Laird, Bissell & Meeds, 120 Broad¬
after a study of PEPCO that
Street, Los Angeles 14, Calif.
earn¬
Goodyear Tire & Rubber Co., Ak¬ way, New York 5, N. Y.
ings on the new common stock
ron; Lee Rubber & Tire
would range between
Corp.,
Prentiss-Wabers Products Co.—
$1.00 and
Central Vermont Public
Pa.;
$1.15 per share on the new com¬ Conshohocken,
Seiberling
&
Service Analysis—Adams
Co.,
231
Corp.—brief analysis in the cur¬ South La Salle
mon and that
dividends of 85c to
(Continued on page 39)
Street, Chicago 4,
rent
issue
of
90c might be
"Preferred Stock Illinois.
paid. However, this
Guide"—G. A. Saxton &
earnings estimate would seem to
Co., Inc.,
70 Pine
be a little on the
Public National Bank & Trust
Street, New York 5, N. Y.
optimistic side
since 1946 share profits after al¬
Co.—Analysis—C. E. Unterberg &
Cities Service
lowance for increased deprecia
Company—review Co., 61 Broadway, New York 6,

would

utility

BOUCHT

U. S. Authorizes

1.24

1943

1939

the

recently

Received to underwrite the unex¬
changed stock, Dillon Read & Co.
being the successful group. Under
|ts recapitalization plan and mer¬
ger with Washington

the

three

period have been made from
reserves
(or will be made). The

3.60% preferred for each
§hare of the,old, to those holders
bids

the

Re¬

year

par

^Competitive

for

amounts

necessary

in¬

equivalent

These

become

now

some

or more and the annual

provision for depreciation
creased

remaining

any

assets of Washington and
■*"

$5,600,000

new-

cipating units would receive

gjbare

stock; the parti¬

cussion

spective"—Calvin Bullock, 1 Wall
Street, New York 5, N. Y.

petition, At¬
torney Gen¬

reduced

Each share of Washing¬
common
stock will be ex¬

common.

Potomac

restrain

Light & Traction

Rubber Industry—Detailed dis¬

conspiracy to
fix prices and

cussion

Purolator

been

guilty of

tended

pre¬

United Light
&
Railways Company and
American

Fairbanks

New York 4, N. Y.

price

and

ferred stock of Potomac ($50 par)
and 4y4 shares of new Potomac
ton's

have

accounting
adjustments
changes in the plan which

values

U. S. Steel Cor¬

marketing

certain

Circu¬

St.,

producing pompanies through the
basing point
•
method

—

Public Utility Integration Trends
—H. Hentz &
Co., 60 Beaver

picture

Stocks

depressed

Broadway, New York 5, N. Y.

Following the announcement of
charges by the Federal
Trade
Commission that the
major steel

the company's
earnings in re¬
lation to the formula set
up under
the plan. About three
years ago
the District Commission ordered

ground

Insurance

discussing
a

rapidly expanding industry
—Laird, Bissell & Meeds, 120

poration denies charge.

fixing. Olds of

the cash thus obtained to
small bank loan. The non-

callable

producers

tically" reduced from time to time
in accordance with the
plan, based

use

against tire manufac¬

turers and colored
motion

during the war. The com¬
pany's rates have been "automa¬

plan, washington will dispose of its interest in
Capital Transit by offering rights
to its own" stockholders.
It will

Fire

lar

prices, Justice Department

enters suit

tion

new

Recommendations and Literature

effect

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

one-half, resulting from the large
increase in Washington popula¬

SEC July 30.
Under

into

that

Oct. 1.

the earnings have shown a
declining trend despite a gain in
revenues during
1939-46 of over

facilitate

the plan, it is also necessary to
recapitalize Potomac Electric and
this plan was approved by the

to fix

companies whose residential rates
are regulated
by a "sliding scale
plan." This may tend to explain

eral

will

since

assumed

Following close upon Federal
Trade Commission's
charges of
collusion among steel
companies

eliminate^

the

price,

New Anti-Trust Moves

for the North American system several
plans

program

plan

around

Washington Railway & Electric is a subholding company in the
North American Company system, controlled
by ownership of about
80% of the common stock. Washington's
principal subsidiaries are
Potomac Electric Power Company and Capital Transit
Company, the
equity interest in the latter being only 50 %. In connection with the

same

generally

Thursday, August 21, 1947

psee

1879

Street. Utice

COMING

$2.50 Cumulative Preferred Stock

EVENTS
In

(Par Value $50.00)

Chicago Railway First 5s, 1927
Chicago City Rails 5s, 1927

Investment

Aug. 22, 1947

BOUGHT

Calumet & South
Chicago 5s, 1927

—

SOLD

—

Bond

ment

the

■

BROADWAY.

NEW YORK 6, N. Y.

Direct Wire to
Chicago

Co.

cago

A.CALLYN«®COMEANY
Y

Chicago

•

Incorporated
New.York

Boston

Milwaukee

Park

Hill

Country

Club.

Prospectus Available

Municipal

(Denver, Colo.)

Club

of Denver Annual
Summer Frolic and Golf Tourna¬

QUOTED

Sept. 19, 1947

Gilbert j. Postley

Field

Minneapolis

Omaha

(Chicago, Ml.)
Bond

Club, of

Chi*

Outing at Knollwood Coun¬

try Club.
Nov.

">-Dec. 5, 1947

Fla.)
Investment Bankers

(Hollywood,
1
Association

Annual Convention at the
Holly¬
wood

Beach,.Hotel.

Number 2622

Volume 166

THE

COMMERCIAL

CHRONICLE

FINANCIAL

(721)

Convertibility: Who Is to Blame? Sees Building Costs Stabilized at January 1947 Level
By PAUL EINZIG

Harry A. Wafrd, Vice-President, Turner Construction Co., looks for no price decline in building but
X
expects greater efficiency in operation.

Asserting majority ot expert opinion in Britain now realizes making

convertible

unmitigated mistake, similar to returif
Dr. Einzig maintains convertibility will
lead to greater British export deficit. Says average Britain puts
blame on U. S., but real blame lies on Mr. Dalton and his colleagues
sterling again

the

was

-1

resulted

most

seems

half

among

its

professional economists and which

ted themselves

evitable

power

for

effects

va¬

convertibility

the trade balance.

balance

crisis

the

consequences

of experts attached to

Even

now

they treat convertibility as a minor
factor and regard the adverse trade

worrying
about

the combined brain¬

government
departments
should have overlooked the in¬

view

reason

dozen

rious

that there was
no

draw

can

some

Dr.

Paul

Einziff

the main

What

of the

cause

they refuse to

see is

that the direct effect of converti¬

of convertibil¬

bility is the substantial widening

ity are still trying hard to defend of the already excessive gap be¬
their position, the overwhelming tween British exports and im¬
majority of expert opinion and ports.
even of public opinion has come
Nevertheless, in view of the ris¬
to realize that the decision Was
ing tide of anger, the government
an
unmitigated mistake, and a considers it a political necessity

is com¬
return¬
to the gold standard in 1925 at
old parity, but it is pointed

costly one at that. It
pared with the mistake of

ing

very

the

find

put

for

an4 excuse

the whole

United States.

its

ill-

blame

the

In his speech dur¬

government ing the debate on the economic
.'has not the same excuse as it had situation in the House of Com¬
22 years ago. There is now even mons on
Aug. 7, Mr. Dalton pre¬
less justification than there was sented the return to convertibility
then to assume that a return to a as an
inescapable obligation aris¬
out that this time the

currency system could in
itself restore prewar normal con¬

prewar

subtracted

the

may run

criticizing

ket

has

been

re¬

but

Mr.

"optimis¬
p r e d i c -

tic

tions'"

cost of

"harmful

tion

such

ex¬

There

has,

items

hogs, wheat
April 1939 and

corn,

Harry

A. Ward

the
backlog of construction work is
released, it will place a burden on
builders and producers of mate¬
and
as

will

costs

tion

costs

over
as

that

fluctuation

might

there

Mr. Ward bases this prediction
on

study

cost

were

the

price

at
not

was

producer

supply the needs of the indus¬

war

1929

level.

188.

gone up and another round of in¬

Tur¬

building

the

for

average
years,

1937-1939,

applying the
increase

same

improbable that building

material prices will be reduced to

that

oc¬

curred after World

War I to

188,

Mr. Ward

has begun.

"It is

after
From

above the pre¬

The

percentage

index.

inclusive,

post-depression
was

trends

revealed in

cost

89.2%

try. Since then factory wages have

creases

a
that

level."

1920

because

always
costs

in either direction

run

from such

such

ure

obtained

356,

index fig¬

figure close to the

Turner index of Jan. 1,1947.

today's construc¬

those

great

1939

everyday life,

has

the increase

in the cost of many items

into

abnor¬

rise

they did in 1920.

The increase in

not been

when

thought

costs

obtain

high enough to induce

Then,

about
been
reached.
We
should expect to stabilize costs as
of Jan. 1, 1947, with the further

which they could be sold

production.

"The peak in building cost has

ago many materials were difficult

a year

have

just

building

too

to reduce their staff and their rate

tain fields where there may

been overstocking," he stated.

ner's

ing

construction is curtailed for
long a period, contractors and
material producers will be forced

any great extent except for brief
periods of distress selling in cer¬

World War I

Mr. Ward explained that

construction. He said that if build¬

mally

April 1947.

rials

stated,

smaller increase in the cost

and cattle between

predic¬

postponing

as great a propor¬
general run of com¬

of construction materials than

that

lead

tions

the

been

whole," Mr.

plained

recently,
predicted that the
building materials will not

modities.

the country as
Ward

indicated

be reduced in

de¬

clining costs as

mar¬

Ward

many

anywhere from 3 to 5%."

'A softening of the material

cent

The line taken is

advised action.

must

contractor's office overhead which

perturbing that

which includes
Ministers

which

major decline
in construction

the

ke smen
and tame fi¬
ll a
n c i a 1
writers
who
have commit¬
the

conver¬

government

into dollars.

sion

spo

foresees

costs.

surplus for the purpose of

growing
vojume of
criticism. Al¬
though the
a

Record."

LONDON, ENG.—Tlie mismanagement of the dollar situation by
government through prematurely adopting sterling convertibility

has
in

Stabilization of

construction costs at about the Jan. 1,
1947, level is predicted by
Harry A. Ward, Vice-President of the Turner Construction Company of New York, Boston
and Philadelphia, in a statement
prepared for a recent issue of the "Engineering News-

Gold Standard in 1925,

nor

entering

have on-

site

building wages increased in
great, a proportion as factory
wages, he stated.

Reports

1946 Hotel Earnings

The "Horwath Hotel Accountant" for June indicates
earnings in
relation to fair value of property were about same as in
1945, but

noticeably less than in 1944.

Loan Agreement
Mr. Ward, who heads the divi¬
The "Horwath Hotel Accountant" for June
government had
reports on hotel oper¬
sion that prepares the Turner Con¬
ditions.
ations in 1946, the fifteenth annual report on the nationwide financial
fought to the last during the Loan
struction Co.'s cost estimates and
What is considered amazing is negotiations against the insertion
results
and
operating ratios of<s>
the
that even now official circles do of
Convertibility
Clause compiles its building cost index, the industry. As in the past, the erty were just about the same in
analyzed the various factors de¬
not seem to have realized the full
report is based on the records of 1946 as in 1945, that, is noticeably
(which is true) and that Lord
termining the cost index.
100 hotels: 50 transients of less less than in 1944.
gravity of the mistake. The ef¬ Keynes wore himself out in an
He explained that wage rates than 500
forts made in favor of diverting effort to resist the American de¬
rooms, 25 transients of
Earnings last year were kept
are not expected to come
down. more than 500 rooms, and 25 resi¬ on an even
British purchases from the United mand (which is quite untrue, as
keel with 1945 only
States to soft currency countries Lord Keynes is known to have Work taken over by craftsmen at dential, which, together, give a
because the upward movement of
indicate the degree of their ignor¬ been in favor of convertibility). higher wages cannot be restored representative coast-to-coast pic¬
sales continued. The end of gov¬
ance
in this respect. Surely it He declared that, having accepted to lower paid branches of labor, ture.
ernment
control
of
restaurants
should be obvious to any first- the
provision,
Britain
had
to nor can the additional cost of paid
As in former years, there is ex¬ made
possible the increases in
honor its pledge
in accordance holidays be eliminated. The con¬ cluded from our report all infor¬
year student of economics that,
selling prices of food and bever¬
struction worker, said Mr. Ward,
since sterling is now convertible, with "the British way of life."
mation that would be of interest ages necessary to meet rising pay¬
has ceased to be a floater and pre¬
it does not make the slightest dif¬
This attitude is in sharp conflict
only to the economist. The sole roll and merchandise costs. But
ference whether Britain spends in with the stream of press reports fers to remain in a fixed position.
purpose in making these studies hotels did not take full advantage
hard currency countries or soft received from Washington during
"We do, however, expect greater is to
develop operating ratios that of this new freedom which is in¬
currency countries, for the latter, the last few days stating emphati¬ efficiency in operation of the job will serve as a guide to the hotel
dicated by the fact that food cost
too, are now entitled to spend in cally that the United States Gov¬ which may help to offset the in¬ operator in meeting his everyday ratios, and in transient hotels also
the United States the proceeds of ernment would have been fully crease in cost that is being brought
the food payroll ratios, advanced
problems.
their exports to Britain. In spite
prepared to agree to the postpone¬ about today because wages are
over
the
1945
figures.
New in the study this year is a sharply
of this, while the government has ment
of
There was a marked increase, too,
convertibility.
Indeed, still being increased," he con¬
recording of balance sheet ratios,
been doing its utmost during the some of the messages claim that tinued.
in the payroll ratios of other de¬
for the first time in the history of
last few months to obtain the sus¬ Mr. Clayton and others in official
Offering no prospect of reduc¬ the hotel industry.
These data partments.
pension of the Non-discrimination positions were fully aware of the tion in contractor's fees, Mr. Ward
The study brings
each year will be included, so that
out clearly
Clause Of the Loan Agreement, it
grave
consequences that would said, "fees received by contractors hotel
operators
can
see
the that hotels, especially the large
has done nothing to obtain the result
from
convertibility
and are exceedingly low, averaging amounts of house banks and ac¬ transients, spent much more for
suspension of the Convertibility were astonished to see how opti¬ less than 6% of the cost of the counts
receivable carried by other upkeep in 1946 than in the war
Clause, without which the suspen¬ mistic Mr. Dalton was concerning work on large contracts from hotels in
proportion to their vol¬ years, despite continued restric¬
sion of Article 9 would be practi¬ his ability to face the additional
tions and scarcity of most mate¬
umes of business, to what extent
cally useless.
burden.
Mr. Marshall is quoted
accounts receivable and food and rials. In 1945 the 25 large tran¬
States
that
the British
people
The government appears to be here as having stated at a press
sient hotels spent $193 a room for
should be left under the impres¬ beverage
inventories
increased
equally ignorant about the inev¬ conference on Aug. 6 that it was sion that their food rations are to
repairs and maintenance and $46
during the year, what inventory for
itable effect of convertibility on not until a week or 10 days prior
replacements and improve¬
be cut because the United States
Britain's
trade
balance.
For to that date that London ap¬ forced the British Government to turnovers other hotels had, and ments, or a total of $239; in 1946
months Mr. Dalton and his col¬ proached Washington about con¬
hand over British dollars to for¬ the current assets they had at the the expenditures for repairs and
maintenance were $249 a room
leagues have been talking about vertibility.
eigners. Yet, in the absence of a end of the year for every dollar
the imperative necessity of reduc¬
These Washington reports have clear-cut official statement by the
and
for
replacements and im¬
of current liabilities.
ing the import surplus through not been given adequate publicity,
United States Government, giving
As for the 1946 general results provements $85, or a total of $334.
an increase of exports. They were
however, and as things are the
This is an increase of $95 a room
and still are blissfully ignorant of average Briton blames the United the full facts about its willingness revealed by the study, they con¬
the elementary fact that converti- States
for
the
adverse
conse¬ to
suspend
the
Convertibility firm the statement made two in the amount expended on the
bility itself has materially reduced quences of the convertibility crisis. Clause, the mistaken impression
property.
It seems, indeed, that
years ago: that hotels reached the
and will continue to reduce Brit¬ Since the United States Govern¬
the
postwar rehabilitation pro¬
encouraged by Mr. Dalton is bound peak
of
their war-engendered
ish exports.
The basic facts of ment has here a well-established
the situation are that most coun¬ reputation for driving hard bar¬ to prevail, to the grave detriment profits in 1944. Earnings in rela¬ gram got off to a good start in
1946.
tries are in urgent need of pri¬ gains, Mr. Dalton's efforts to put of Anglo-American goodwill.
tion to the fair value of the proping

from

the

He stated that the

■.

■

mary
can

necessities and that

only export

sities

Britain

secondary neces¬

luxuries.

long

sterling was not convertible this
did not)matter very much. Swe¬
den

was

British

only too pleased to accept
textiles in payment for

the

blame

were

bound

the

United

meet

with

States
a

fair

pulp.

British

receive

or
.

they naturally make ful
their rights. They have no

wheat

use

manufac¬
tures, because they now want to
frave the largest possible sterling

1 further

use

for British

Amott, Baker & Co.

of view of

Anglo-American rela¬
tions, it is of great importance
that the willingness of the Wash¬
ington
State
Department
and
Treasury to postpone the appli¬
cation of the Convertibility Clause

Denmark was glad to
automobiles in
payment for butter and cheese during the negotiations that pre¬
.The moment, however, they are ceded July 15 should be placed
given the option of using the on record as officially and as cir
.sterling proceeds of their exports cumstantially as possible. During
for purchases of American coa1 the next few months the British
wood

ACTIVE MARKETS

degree of success. From the point

people will have to undergo con¬
siderable hardships through the
cuts in food imports necessitated
by the dollar crisis.
It would not
be to the interests of the United

50
Bonds

INCORPORATED

BROADWAY
and

New Common

Wholesaler and Retailer

80 JOHN ST.
4-5s

Investment Securities

REAL ESTATE

SECURITIES

1950
Our

Trading:

Department

★

specializes in real estate bonds

Bought—-Sold—Quoted

and

stocks,

title company and

bank participation

SIEGEL & CO.
89 Broadway, N.

Y. 6

DIffby 4-2370

Teletype NY 1-1948

certificates.

SHASKAN & CO.
Member t New York
Member t New York

150 BROADWAY

Boston

NEW YORK 7,

N.Y.

Philadelphia

4S EXCHANGE PL.,

Stork Exchange
Curb Exchange

N.Y.

Bali Teletype

0l9by 4-4950

NY 1-953

Connecticut Brevities
The

consisting ofF- S. Moseley & Co.,
Estabrook & Co. and Putnam & Co. at 100.3197 for bonds carrying
a
rounon rate of 1.40%.
There were two issues both dated Aug. 1,
1947- $224 000 Street and Bridge bonds of the City of Waterbury
due $14,000 annually "1949 to 1964 inclusive; and
$100,000 Storm
Water Drainage bonds of the city^>
~~
maturing $6,000 annually 1949 to company's New Haven division
1963, inclusive, and $10,000 in reported sales of 23,268,522 kilo¬
to

bonds

watt hours last month against

1964,
bonds

The

reoffered

were

scale ranging from
.80% basis to 1.40%.

the public
an

Rail¬
way and Lighting showed
$1,069,448
available
for
fixed
charges of $56,107, or coverage
19.06

This

times.

fixed

total

sales

against

$7,871,811

$5,173,297 for the corresponding
period a year ago. Net income for
the six months' period ended May
1947, was $411,589, or $3.12
share. Corresponding figures
for last year were not reported.
31,

"•

Electric

issuance of $12,-,
2%% debentures to be
dated July 1, 1917, and to ma¬
ture in
35
years.
The funds

693,

000,000

used,

finance

turbo

kilowatt
other

generator

station

located

establishment of

tract

the

40-acre

market

produce
on

south meadow section of Hartford;
'

For

month

the

Connecticut

Light

the

July,

Power

Company reported sales of 77,105,000 kilowatt hours compared !
with
,

75,182,000

for July

hours

for

revenue

sand

misery and
.chaos? every¬

been

hours for the month of July com¬

pared with 29,068,986 for the cor¬
a year ago.

The

the

Twice

In the practice of dentistry, you
know what high taxes do to prices

.two

world

emerged into clear perspective:
The
first. is that Old
World

leadership is bankrupt; and

gone.

and to fees. You know
every

additional

facturing unit of
60,000 square feet
The

because the costs of produc¬

tion

have

was

into

the

liberty's world leader.
part of this world-wide

process,

been

important change has
We have had

taking place.

manu¬

located

the Bristol plant.

pected that this
in

move

It is ex^
will result

considerable

company

saving
to
the
through elimination of
expenses

and

trunk

personnel,

lines,

transportation

and

role

of fundamental

people

our

trucking

materials

duplicate cafeterias.

Consoli-

idation of similar departments and

assembly lines should also prove
substantial saving.

all want to

help other peoples to help them¬
selves.

But

cannot

afford

perpetual gigantic world W. P. A

work1

Members

New

York

and

Boston

must

Exchanges

BOSTON,

Associate Members New York Curb

Reducing Over-Grown

staff

Primary Markets in

Edward E.

the

Mathews Co.,

State Street.

,? ?

Hartford and

The

American

vember issued

people last No¬
clear mandate to

the 80th Congress to reduce over¬
grown; government.

ordered

and

wasteful

The

people

eliminate

useless

bureaus

and

com¬

GRAND

New York:

BOwling Green 9-2211
Bell System Teletype:

IIF 365

Green

with

RAPIDS, MICH—John
has

Paine,

Curtis,

become

connected

Webber, Jackson

Peoples

National

Bank

Building.

rapidly
govern¬

structure.-

reduction
taxes.

were

regular

the

ended,
stayed. The

The

but
voters

emergen

the

agencies

demanded

the

They declared they wanted

London

2-430!

Hartford 7-2689

New York Canal 6-3662

Teletype NH

194

possible.

that

not

duce disaster in

Practical

our

own

common

balance

seen

some
strange
Administration

the

that any Communists

versionists

the* govern*

were ;

other sub-

ment service at all.

When

a
Republican Congress
elected, the Administration
promptly saw the handwriting on
the wall. It
suddenly discovered
.

Second

study- of
to

the

report

Session.

clean

them

thousand of them
their:

out. About

were

identities

ousted,

were

very

carefully concealed from the

Con¬

gress and the country. We intend
to clean them out and
nobody is

going
to
stop
patriotic duty.
The

from

that

80th

Congress was con¬
by the necessity to do
three things:
.

fronted

first

was

determine

appropriations

should

cut.

The

second

how

was

much

people's money

determine

the

American

safely af¬

can

ford to send to other countries of

failed to meet the emergency. We
now
have a committee making

special

dollars to
a

The

housing
as
a
major necessity. After spending
billions of dollars, the New Deal

many Communists in the govr
ernment the President
thought it
would
take twenty-five million
so

where

recognize

problem

v*as

must

policies in these mat¬
ters;.?;. /.7-7'7' -7 '
We have a committee
studying
the whole problem of high costs

back

housing
at the

Meanwhile

the world.

to determine how

was

reduce

can

;

The third

the

load

tax

so>

the low income people
may have
more of their hard-earned
money
to

spend

for

themselves

the

for

things they need and desire.
We

had

taken

which

governmental

would

expen¬

boys
extravagance:

spend-and-spend

end to their

has

three

people

will

not

become

concurrent

see

receive

and

action

determine

how

tax

reductions

for

all

the

The

government

people will remember such

bill

not

once,

tax

re¬

but twice,

overwhelming majority of

both Houses. The bill would have

before

the

by Speaker Martin

American

Dental

As¬

sociation, Boston, Mass., Aug.
1947t ' ■ •
J* * !

5,
.

■

that

the

task,, of course,

new

labor bill which

was

passing

fairness

assure

both

and

reason

collective bargain¬

ing.
The

80th
Congress
began
a
along three lines of policy
which I am going to detail to
you,
-

move

all

certain you
them.

will agree with

usurped

Survey of Governmental
Functions

functions

convinced the only
properly belong in State; way we can really cut the over¬
local, and private areas of action: grown government back to proper,
were

which

The

til

Federal governihent set
bureaus and commissions

them.

out

ran

even

up
un¬

the

designate

to
repeat.
individual in this

can

bureaus
have

letters

had

betical

which

Then

gathering who

begin to

half, of
and

been

the

name

alpha¬

commissions

created,

to say
nothing of describing their func¬
tions.
The

Federal
endless

government
maze

intent

be¬

over-lap¬

ping, contradictory, feuding,

niving

Congress passed

any¬

policies

has

innumerable

came an

attitude.

assure

three

all—-or

people.

all

once.

There'is not

vent

incentives to venture

capital to engage in expansion of

Over the past 14 years the Fed¬
eral

alphabet

savings in governmental
and extravagance and
pre¬

clear

perfectly

actions must

are

determine

Democrats that they were able to
obstruct greater savings and econ¬

becomes any

restore

can

sides—which would restore order

happy future for the

kindly — nor should they — the
gloating taunts of the New Deal

ill

off

United States of America we, must
follow out three lines of inquiry

new

The

shackles

Three Lines of Inquiry

itself

policy is working.

the

would

have saved several billions of

dollars

*An address

Waterbury 3-3160
Danbury 5600

have

country.

sense

govern our

con¬

scheming bureaus, each
on
entrenching itself so

deeply in the Executive branch of
the government

pregnable

all

to become im¬

efforts

the

Congress to dislodge it.

New Haven 6-0171
New

best

careful

thing like

The

CO.

government.

but

ourselves of goods to the
point where sky-high prices pro¬

taken.

duction

continuing

drain

burdensome

obstruct

Members New York Stock
Exchange

50c

and new jobs a
bring, down prices and
improve quality, k
'
' 7" '
Through cuts in appropriations,
recisions, and the adoption of an
economy policy by the Congress,

CHAS. W. SCRANTON

was

change

mental

but

war

administra¬
tion to feel joyful because it can

Markets—Statistical Information

this

people get houses instead of blue¬
prints and newspaper headlines.

into

cies

waste

Primary

production, so we may have better
quality, at lower prices. Back of

emergencies,
frozen

Connecticut Securities

deal

private industry so we can hope
houses may be built. We believe
private enterprise will help the

under

created

omies.

Fifty-sixth Year of Dealing in

great

have

were

The

(Special to The Financial Chronicle)

Hartford 7-3191

the device of
mislead the Con¬

agencies

The economy

With Paine, Webber Co.

gress.

missions, and departments. Those

ditures.

Connecticut Securities

be: the
be

Government

MASS.—Kenneth

McCarthy has been added

Exchange

60c

readjustment of prices. The costs
of the things people
need must
be as low as possible. The
quality

chance to

Special to The Financial Chronicle

Stock

taxes
risen.

of consumer goods.

industrial

With E. E. Mathews Co.

for
,

There

give production

Tifvt Brothers

and : the
prices have

dollars.

importance to the

American nation.

property on Homestead AvenUei
in Hartford, adjacent to the pres¬
ent plant and will house opera¬
tions which are presently carried
on

assume

authorized.

risen,

begin

forced*

has

You know also that after you get
to a certain: point of income
you

;

approximately

unit will

new

item

have to purchase in the'prac¬
tice of your profession costs you
you

deeply involved in world
problems
and
world
distress.
very

have

conceal,
half-truths,

acrobatics

concealed

struction

the

cooperation

departments

have

would

fair

due to deliberate efforts to
our real form of

entirely of taxes.
Congress passed that

continue to bear their burden.

and much human misery
suffering,
two
facts
have

wars,

meeting of the directors
Veeder-Root,
Inc., the con¬

less

and

ceased. Over the past 14
years the
practice has become the rule for
the bureaus and the

concerning the expulsion of Com¬
bill, and twice the President by; munists from high places in the
J his veto said the people could not Federal government. There were
have a tax reduction. They must
a
repeated
and
emphatic
denials

not want—of having to exert vast
phones in service at the end of ? and
controlling influences upon
June
this
year
were
619,374 1 the various countries
and peoples
against 555,610 a year ago;
,
of the globe. That change is one
i-.

re¬

sion of events,

Hon. J. W. Martin, Jr.

Total tele¬

have

would

10% reduction. Tne aged
with incomes of a thou¬

relieved

must

the

long proces¬

first

have had

facts,

the

Out

incomes
a

dollars

must

telephone

Illuminating Com¬
pany's Bridgeport
division
re¬
ported sales of 29,966,694 kilowatt

where

•planet?

position of being the world's chief

$19,256,476,

was

The United

responding month

-boiling., of

government

People

would

reduction. Those with the

citizens

lender and

traveling

kilowatt

of 1946.
$

1946.

up-;

reduction

Events

]

compared

;■

McConaughy has
signed the bill authorizing a $l,-j
200,000 self-liquidating bond issue
regional

500,000

this

them.

brackets

20%

did

o v e r n o r

to finance the

ing period in 1946;

erty.
*

ceived

the

7- The second is that we have been

6.6% ahead of the correspond¬

im¬

first half

Total"

provements and extensive sub-,
stations and distribution prop¬
.-is

outstanding,

half of 1947

and

generating

New I

Company,

45,000

Telephone

$2.07

the

threes-year

addition

the

ended i

$1,693;103, or $4.23 a share
400,000 shares outstanding in

on.

construction program which in¬
cludes

months

with

from this issue will be

derived

six

showed net earnings of $1,033,-

approved the
*

highest

out

.of

Inc., and

1947,/ Southern

30,

England

have

Company

Light

the

For

of Hartford

The stockholders

and

.progress

and

June

from

30%

money

bring
sanity,:

Cana-

$994,033 for the first six months
of this year, after charges, Federal
taxes, and a reserve for contin¬
gencies in the amount of $200,000.
This compares with $1,327,000 for
the first half of 1946. Earnings per
share for these periods were $1.65
and $2.21, respectively; net sales
$10,091,842 against $9,372,058.
j

the

middle

help

per

-•

takes

can

peace,

May

brackets

come

How

Powdrell & Alexander,

Manufacturing
Company of Middletown showed

given the people in the lowest in¬

going to end?

its subsidiaries" reported net profit

Russell

1947,

chaos,*$>-

.fear, hatred
.and
suffering!

June

order
*

For the six months ended

31,

probably is not a thoughtful citizen in this country who has not asked him¬
times: What .of the future of America?
Whither is my nation headed? What
commitments are being made of which we know little-or
nothing?
How is all this

the sales of its

subsidiary,

98%-owned

;

There

world

ended

self many

dair, Ltd.

of 9.48 times for the 12
months ended June 30, 1946.
X

Speaker Martin, in outlining work of Congress, holds problems ahead are: (1) to determine where
(2) how much of the American people's money can be sent to other
countries, and (3) how can the tax burden be reduced. Says we must revise "over-grown govern¬
ment," determine a scientific taxing system and inform ourselves cf the real facts about European
conditions.
Asserts we have job of saving world, while keeping America free, sound and
solvent.
appropriations should be cut;

quarter

includes

figure

compares

coverage

"Speaker of the House of Representatives

30, 1947, the Electric Boat Com¬
pany reported gross sales, less
discounts, of
$7,032,296,
This

$1,391,551
available
for
charges of
$146,807, or

with
'

the

For

June 30, 1947, Connecticut

do not include sales to Con¬

necticut Light & Power Company.

ended

months

20,-

These fig¬

117,717 for July, 1946.
ures

the

For

By HON. JOSEPH W. MARTIN, Jr.*

;
*

group

Thursday, August 21, 1947

What of America's Future?

awarded $324,000 principal

recently

Waterbury

City
of

amount

CHRONICLE

& FINANCIAL

COMMERCIAL

THE

(722)

The

old, traditional practice of
giving the Congress

the

bureaus

and

its

various

Committees hon¬

est, trustworthy information, real

efficient, economic peacetime size
a
genuinely non-parti¬
san, constructive, objective survey
of
governmental
functions. ;.We*
is to have

must

determine

returned

state, local and
where they belong,

private areas,
and

which

the

Federal

continue

functions:

useful

are

should be:

which

the

should

government

perform.

That

Com¬

mission will be composed of some
of the ablest men in this nation.
None

less

Herbert

than

former

Hoover,

head

that

acter

President

hope,'; will

Commission.

Its

char¬

membership's such as
to be a guarantee of integrity and
impartiality in its operations and
findings.
At the same time we set up a
special committee operating to aid
the Ways and Means Committee

determine

system. For 14

(Continued

scientific taxing
the tax sys-

years
on

page

27)

COMMERCIAL

THE

Number 2622

yolume 166

FINANCIAL

CHRONICLE

(723)

Michigan Brevities
The

;

of investment bankers headed by Smith, Barney &

group

including, among others, First of Michigan Corporation,
JWatling, Lerchen & Co. and M. A. Manley & Co., all of Detroit, and
E. H. Schneider and Company of Kalamazoo, on July 24 offered to
the public 400,000 shares of no par value $3.25 dividend second pre¬
ferred stock of the Dow Chemical Company at $102.50 per share and
dividends.
This issue, which L<$>
General Manager, announced that
Convertible into common stock
and

Co.,

- —
forior to July 15, 1957, was over,

L
iubscribed.

r
'
"
""
The net proceeds will
_

Knn

—j

v,onir

nnn

continues in

good

cash position, with working

cap-

company

ital

approximately $30,000,000.
fce used $7,500,000 to repay bank
*
*
*
loans, and the balance for general
James Gerity, President of GerCorporate expansion purposes.
'
Die
Casting
Co.,
The consolidated net income for ity-Michigan
Adrian, announces that sales for
$he year ended May 31, 1947 was
the three months ended June 30,
equivalent to $9.22 per share on
the old no par common stock, as 1947, amounted to $3,944,904, and
for the full fiscal year ended on
compared with $4.40 in the pre¬
that date to $13,941,400. The lat¬
ceding year, and $7.85 in the year
ter figure compares with sales of
Cnded May 31, 1945. As of July
,j 1947, there were 8,249 common $4,414,959 for the preceding fiscal
vear.
For the six months ended
Stockholders and 4,366 preferred
June 30, 1947, net profits'were es¬
Stockholders. Sales and other rev¬
timated at $1 per share, of which
enue
for the
1947 fiscal year
55 cents was reported earned in
Amounted
to
$132,787,648,
as
the last quarter.
This compares
against $104,579,729 in the precedwith

year'
i

*»*

*
v

Dec.

months

six

the

Included in

31, 1946.

Inc., which offered

647,395

Newhard, Cook & Co. was among the lists of underwriters which
July 17 offered 60,000 shares of e>
—;

and

ended

headed by The First Boston Cor¬
poration and Shields & Co. of New

and

current

The

liabilities,

:i:

Western

Auto Supply Co.,
City, reports that net earn¬

ings for the

months

three

York

City, and the Florida Power
syndicate by Halsey, Stuart & Co.
Inc. of

Chicago.
*

Reinholdt

the list

among

Gardner

derwriters

New

of principal

(headed

Aug.

York

Louis,

City)

offered

underwriters

Blair

Co.,

year.

Lester

Missouri

$10,000,000

Co.

Board,
who

nor.

ident

sented

repre¬

80% of the 100,000 out¬

standing

stock

the

utility

common

company.

July

offered

•

$750,000

tive

sinking fund deben¬
tures
(with common stock pur¬
chase warrants attached) of Clary
15-year 5%

managements
of

their

342,201

totaled

1947,

1 y,

$180,443, or
94 cents per share, after deduct¬
ing provision for Federal taxes
of $120,443.
Current assets as

market value of

shares having a

This compares with
volume of 230,023
shares valued at $2,853,381 and
is the highest monthly volume
rand market value to
date in
1947.
Previous high this year
Avas in February when
301,467
shares were traded, with a mar$4,366,823.

1947

June

Jket value

of $3,794,852.

The $1 par common

stock and

cumulative con¬
of Mc-

the $10 par 5%

vertible preferred stocks

Co. were
admitted to trading on this Ex¬
Manufacturing

Aleer

July 30 and the $1
common stock of Ryerson

change
par

admitted on

Haynes, Inc. was

Aug. 13.
Hs

The Packard Motor Car
a

$1,148,173
months brought
the total loss for the first half of
1947 to $1,872,634. This compares
with a profit of $749,517 in the
:first six months of last year. Re¬
flected in the 1946 figures, not
■found
in
the
1947
accounting,
were
$2,214,000
tax
carryback
credits and $1,769,911 in fees ap¬
added

the

deficit of

for the first three

plicable to

war

production con-

Tracts terminated in 1945.

Christopher,

George

President

and

of that period were

end

current lia¬

$624,066, as against
'

:|i

;

underwriting

headed

Lehman

•

syndicate,

Brothers

New

A. G. Edwards & Sons of St. Louis.

agreement.

have

demption

Louis,

July 31

consolidated
net
profit
of
$401,113,
after
charges and income taxes, and re¬
serve
for
decline in inventory
values of $24,000. This was equa

offered

sinking

of Florida

ment

$2.41 per share (calculated on
166,225 shares of common
stock outstanding at the end of

period). Net for the corre¬
sponding six months of last year
was
$252,192, or $1.52 per share
on
the same number of shares
this

six

the

For

months

ended

30, 1947, the Detroit Alu¬
minum & Brass Corp; reports a
June

profit

net

cents

per

provision

67
common share, after
of $230,000 for Fed¬
of $302,893,

by Van Alstyne
Noel Corporation of New York,
headed

monies,

fund

made

and

Y„

$102.50
an

Dow

and

Co.,

per

share and dividends,
400,000 shares of

issue

Co.

Chemical

dend preferred

$3.25

stock of

divi¬

Plywood
This of¬
fering was oversubscribed. The
net proceeds will be used to in¬
crease working capital, etc.
value

directors

The

Chemical Co. on
call

par

Sept.

City and

County at next Novem¬

ber's election will decide on a bond

tax and contingen¬
dividends paid were
$113,401.
The
company
has
453,600
common
shares out¬

L J.

Street,

Broad

share.

cents per

stock

of'

common

stock

two

before Sept. 11.
The

•

consolidated

net

(excluding British and

sales

Austral¬

for
the six months ended June 30,
1947
amounted to $71,085,736,
subsidiary

ian

companies)

Marquis & Go. to

Admit Milton Mensch
Milton Mensch, member of the
York Stock Exchange, be¬

New

came a partner in L. J. Marquis &
Co., 1 Wall Street, New York City,

members of the New York

broker

Stock

Mr. Mensch has been

Exchange.

individual

for many

floor

years.

Victor M.

at
plus accrued

share,

Each, share of preference
called
is
convertible
into

Cortes, a member of
Exchange, and a partner in
firm, died on Aug. 10,

Marcus Co. to Admit
Wayne A.
the

New

and

Joseph

mitted to

member of

Marcus,

York

Stock

Mindell

Exchange,

will

ad¬

partnership in Marcus &

Co., 61 Broadway, New York City,
members of the New York Stock

Exchange,

of Sept. 2.

compared with $50,249,553 in

the

period

same

income

taled

Kansas

Chase

City of New

York, N. Y.

active

Monsanto
Aug. 11 voted to
of

redemption

for

mated

Jackson

scribed.
,v

Atlas

$1)

Corp. at $32 per share.

July 25, publicly offered 72,882
shares of common
stock
(par

(convertible into common
stock prior to July 15, 1957).
This
offering
was
oversub¬

value

The voters of

Day

Company, Inc., of St. Louis, on

per
dividends of

Taussig,

stock, series A, of the company

including,
among
others, Newhard, Cook
& Co., Reinholdt & Gardner and
Stix & Co., offered publicly at
Barney

included,

which

others,

among

$104.50

syndicate

the

24, an underwriting
headed
by
Smith,

trustee,

The

the

102.60 and interest.

On July

York,
New

1977, next, 120,000 shares of the $3.25
Light Co. at cumulative convertible preference

Power

re¬

Western Auto Supply

12,

ended June 30, 1947 a

the

of investment hank¬

group

series due

bonds,

gage

Electric Steel Co., De
troit, reports for the six months
Rotary

A
ers,

York, N. Y., and which in¬

St.

for

been called

Sept. 1, 1947, out of

National Bank of the

cluded, among others, Stix & Co.

the

eventual

$275,000 of
Co. 15-year
Multiplier
Corp.,
Los
Angeles, sinking fund debentures, due Sept.
Calif., at 100 and interest, was 1, 1955, at 100% and interest, pay¬

publicly $10,000,000 of first mort¬

$226,647.

bilities of

Co. re¬

loss of $724,461 for the
.second quarter of this year, which
ported

the

amounted

1947

respec¬

towards

have been discontinued

mutual

There

which had

discussions

been conducted by

t-C

Pres¬

Gamble-Skog-

and of

informal

merger,

Among the underwriters which
on

Manager.

Inc., jointly announced that

possibility

:i:

:!<

Paul E. Con¬

General

and

Vice-President,

was

company
mo,

80,000

succeed

On July 17, executives of this

(the

stockholder).

These

President,

Chairman

replaces Mr. Hutchings

$8.87Vk

Rodgers of Dallas, Tex.

elected

Gamble, resigned.

share for the account of L.

selling

3% sinking

Edison

been

the

stock

common

Hutchings,

has

New

July

$1,751,350, as against $3,in the first half of last

was

497,078

headed

Inc.,

Y., which

value

par

per

which

both

Co.,

included

were

group

Securities

publicly offered 80,000 shares of

un¬

Merrill

Lerner Stores Corp.

St.

Bond

White

York, N.

was

Lynch, Pierce, Fenner & Beane
of

and

•;!

ended

June

net
Bankers

Co.

reports that trading volume

3,963,163

$12,770,876.

Kansas

value

par

shares of $5 par value common
stock. Current assets were $65,-

30, 1947, amounted to $1,California Electric Power Co. $2.50 program
totaling approximately 310,261, after provision for con¬
tribution
to
cumulative preferred stock
Employees' Profit(par $47,000,000, of which the city pro
$50) at $52 per share and divi¬ poses to issue $34,911,000 of gen¬ Sharing and Retirement Trusts,
dends and on July 31 offered $10,- eral improvement bonds and $6,- depreciation and amortization, and
In the
000,000 Florida Power & Light Co. 000,000 of new airport revenue estimated income taxes.
314% sinking fund debentures due obligations, and the County plans corresponding period of 1946, net
1972 at 101 and interest. The Cali¬ an issue of
earnings amounted to $1,992,127.
$6,119,500 of bonds.
For the first six months of 1947,
fornia
Electric
syndicate
was
*
tit
*

Corporation
*
*
fund debentures at 100 and in¬
lists of in¬
terest. This issue was oversub¬
J.
Oliver Black, President of
vestment bankers which on July
scribed.
31 offered $10,000,000 first mort¬ Peninsular Metal Products Corp.,
#
reports that sales for
gage bonds, 3% series due 1977, of Ferndale,
On July 31, a group of under¬
the first half of 1947 were 300%
Florida Power & Light Co. at
102.60 and interest, and 200,000 over the comparable 1946 period writers, headed by Morgan Stan¬
ley & Co. and Harriman Ripley &
shares of capital stock (par value and represented the highest vol¬
Co., Incorporated, of New York,
$15) of J. P. Stevens & Co., Inc. ume in the company's peacetime
N. Y., and'which also included
at
$34 per share.
The Florida history.
Stern Brothers & Co., offered pub¬
Power syndicate was headed by
On Aug. 5, the directors de¬
licly an issue of 200,000 shares of
Lehman Brothers and the Stevens
clared a dividend of five cents
J< P. Stevens & Co., Inc. capital
syndicate by Morgan Stanley &
per
share, payable Aug. 28 to
stock (par $15) at $34 per share.
Co. and Harriman Ripley & Co.,
stockholders of record Aug. 18,
*
*
\sR
Incorporated, all of New York,
1947.
$
%
N. Y.
Watling, Lerchen & Co.,
Stem
Brothers
&
Co.
and
Detroit, also participated in the
Tecumseh Products Co. of TecSmith, Moore & Co. (the latter
Stevens offering, as well as the umseh, for the six months ended
of
St. Louis)
participated on
offering on July 16 of an issue of June 30 reported net sales of $15,July 30, together with other un¬
300,000 shares of no par common 579,000 and a net profit of $1,102,derwriters headed by The First
stock of Kimberly-Clark Corp.,
Boston, Corporation, in an offer¬
231, or $7.34 per share, after pro¬
Neenah,
Wis.
at $24.87 %
per vision for taxes of $734,820.
ing. of 160,000 shares of 4l4%
share by a syndicate headed by
*
*
*
Cumulative preferred stock
of
Blyth & Co., Inc. of New York.
Public Service Co. of Colorado
;
Kysor Heater Co. of Cadillac
sje
si:
*
»
at par
($100 per share) and
reports that net profit for the
dividends.
The Detroit Stock Exchange
seven
months ended June 30,
First of Michigan
Was also among the

;

out

underwriting syndicate headed by Halsey, Stuart
on July 23 an issue of $11,000,000 first mort¬
gage bonds, 2%% series due 1977, of Arkansas Power & Light Co.
at 101% and interest, were Newhard, Cook & Co. and Reinholdt &
Gardner, both of St. Louis, and Stern Brothers & Co. of Kansas City.

& Co.

of 58 cents per

profits

for

<diare

■

net

dividend preference stock with¬

Missouri Brevities

Net

1946.

charges and

$9,275,133, as against $6,-

185,234 in the
June

esti¬
Federal income taxes to¬
after

30,

1947

there

were

chemical

1946 period.

standing 237,019 shares of

michigan

out¬
$3.25

eral income

cies.

Cash

at the
end of the period amounted to
$2,236,581, as against total cur¬
rent liabilities of $732,478.
current

Total

Peltasonjenenbaum Co.

MARKETS

LANDRETH

standing.

assets

Berkshire Fine Spinning

BUILDING

ST. LOUIS 2, MO.

Chicago & Southern Air Lines
Cleveland Cliffs Iron NEW

Teletype—SL 486

L. D. 240

Ely & Walker Dry Goods Co,
El Paso Electric

Gulf States Utilities

Charles A. Parcells & Co.
Established

ALLIED PAPER

Hearst Publications
Kansas

1&19

MILLS

Members Detroit Stock Exchange

Pfd.

City Pub. Serv. Com. &

Pfd.

Rockwell Mfg.
Latest

Michigan Markets
639 Penobscot

DETROIT 26,

Building

MICH.

Telephone

Detroit

Stock

1051 Penobscot

Bell

Teletype

SL 456
Bay

City

—

Lansing

—

Muskegon

RICHTEH COMPANY

509 OLIVE

STREET

St. Louis J,Mo,

Landreth Building

Building

DE 206

INVESTMENT SECURITIES

Southwestern Public Service

Exchange

DETROIT 26, MICH.

Teletype

Randolph 5625

Information

Moreland & Co.
Member

Stix & Co.

LaPlant-Choate Mfg.

Garfield 0225
St.

Louis 2;

Mo.

L. D. 123

Members St.

Louis Stock Exchange

COMMERCIAL

THE

(724)

Bank and Insurance Stocks

earnings in other directions and
to decrease expenses in both.
author

The

instructive book has just come from The
Bankers Publishing Co., Cambridge, Mass., which should be wel¬
comed by all serious students of banking, including bank stock
investors and dealers.
It is entitled "Meeting The Challenge of
Changing Banking
Conditions," and the author is Nelson M.
McKeman, an Assistant Vice-President of Manufacturers Trust
Company. New York.
<v
v
——

(b)

preface the author states:
"This discussion of the changing
conditions affecting banking, de¬
veloped from work done in con¬
School

ate

Banking, subse¬
quently broadened and brought
up to date,"
.

This

not

worthwhile

first

the

Number

banking

1901

1907—
1915—

ago

two

divided

divisions.

main

831

Such

37,721

1,265

55,289

18,390
14,535

41,643
142,310

2,245
2,264
9,791

the

back

the

1920

Part

the

turn

the

comes

short

out

kets.

The

American

"whipping
pression
in

boy"

years

lic

Attitude."

31,

the

this

was

1920
.28

It is pointed

of loans to

declined

and

from

.26

second

with

problem

ad¬

justing to these changing condi¬
tions.

de¬

The general problem is for¬

mulated,

points

and

ment

(2)

the

following four
presented: (1) banks

are

have become

"atti¬

than

more largely invest¬
lending institutions;

efforts must be made

build the loan position;
the situation

main

topic
of Chapter VI., ■
Subsequent chap¬

proper

(3)

re¬

until

changes substantially

there must be

"Types of

Functions."

makes

claim

clearly presents the

problems

steps that are being taken, and
yet be taken, to find a solu-

may

on.

for
the

emphasis on

evaluation of bond values

and bond

market, economic trends

etc.; (4) with the decline in yields,

"Banking

efforts must be made to

which

his

accomplished.

method

Just

from

differs

concept

voluntary agreement,

achievement

world"

bonded

was

force rather than

ing.

by understand¬

•

decades,

that

see

until

recent

has been one of the
methods of economic ex¬

major

war

pansion and, in

many

successful

Until the turn of

one.

instances,

century, economics itself

issue

Jahn & Oilier

102,000

Engraving Co.

com¬

(par $1) is being of¬
fered today at $6 per share
by a
syndicate headed by Sills, Minton

Co.,

Inc.,

of Chicago,

in¬

and

cluding Buckley Brothers; Straus
&

Blosser; Butcher & Sherrerd;
Belden, In%; Link, Gor¬

Frank &
&

man

Co.,

Inc.;

Engart,

Van

Camp & Co., Inc.; Bradbury-Ames
Co.;

Kirstein

Co.,

was

extension

and

Reed,

history provides too few
xamples demonstrating that eco¬

nomic
aot

and

political

conquest

permanent improvement of

the

thought
The

tion.

although
seeking formula¬

was

first

world

was

war

to forward-looking

proof enough

of all nations that

men

living

the victor,

war

is dis¬

astrous to

victor and vanquished
ilike, and that international eco-

nomic

cooperatiorywould be

nec¬

essary to prevent its recurrence.
They grappled with the compara¬
tively new science of peaceful
world economic growth

Lear & Co.

are

satisfactory methods for the

standards

and found

NEW JERSEY

another

behind

war

their conclusions
a

are accepted by
of .the world's popu¬

majority

lace.

SECURITIES

Those

principles

accord
find expression in the United

now

Nations Charter and

are

increas¬

evident in'mliliofthl *p61icy
the world over.

Request

J. S.

Laird, Bissell & Meeds
Members New York Stock
Exchange
120

Bell

Teletype—NY

Eliminating Economic Causes

Rippel & Co.
Established

BROADWAY, NEW YORK 5, N. Y.
Telephone: BArclay 7-3500

MArket

1-1248-49

N. Y.

have

given this brief back¬
ground to emphasize that in the
all important problem of eliminat¬

3-3430

Phone—REctor 2-4383

ing

the economic causes of war,
should not succumb to a fear

complex
torical

WHOLESALE MARKETS IN
BANK

and

oiINDIA, LIMITED

INCORPORATED
NEW YORK Bt

WHiTXHAU. &-O702

Bankers

the

Head

Office:

26,

There

pen

Offia S4mri

WStooMlo

CHICAGO 4

iii S

CaSaUt Stmt

LOS ANGELES 14
«0

Vtrf Sixth

munklim Tsao

CGwoj

Sir*

hit

Branches

SAN FRANCISCO 4

Colony and

wjmm o«a

M-S7J

Aden

and

Kenya

Zanzibar

■

Detroit. Enterprise 6066

The

Bank

conducts

every

description

banking and exchange, business

historical prec¬

our

the

Nations, much
earlier

League
The present task is to

mechanism

it well

into

oiled,- to

use,

retool

to
it,

modernize it. when necessary
and assist it where possible.

International

Chamber

Commerce sought the consultative

status

itnow '*• enjoys -with

the

Trusteeships and Executorships
also undertaken

understanding

and

The

Paid-Up- Capital—.-*.--£2.000,000
Fund-,^.—£2,300,000

..'Portland, Enterprise 7006-

owes

this

keep

Reserve

Enterprise 6011

Enterprise 7008

of Nations.

Subscribed Capital-—£4,000,000

NEW YORE, BOSTON.
CHICAGO.
CLEVELAND. PHILADELPHIA, LOS ANGELES, SAN
P1ANOSCO

TeleJ*h0»es TO' Hartford,

Burma, Ceylon,

Xjus BuOdrnf

FRIVATE WIRE SYSTEM CONNECTING:

in India,

are no

for

in the United

now

put

Bishopsgate,

our

position today.
is no historical parallel to
the peace mechanism which exists
as

London, E. C.
•OTTON t

We have made tremen¬

There

Government in

Kenya Colony and Uganda

Wall Strut
NY 1-2070

belief in his¬
and historical

practical solutions to this prob¬

edents

NATIONAL BANK

repetition

dous strides in

INSURANCE STOCKS

lem.

-r

based

oarallels.

GEYER & CO.

in the province of the Eco¬
nomic and Social Council is evi¬
at

anyone who has looked
organizational
chart of

the

either

ity,

body. Due to this complex¬
often forget our enduring

aims

under

the

with

which

welter

detail

immediately
concerned. Lest we lose sight of
them entirely, it is well for us to
are

review these aims and state them

simply and clearly.
Desire for Peace

The deepest desire and highest
aim of all people is peace; peace

nations and peace among
individuals.
I believe that is a

among
full

statement

which

all

world

would

desires

our

the

peoples

the

But

subscribe.

the

word, peace, carries with it many
implications. First, it must not be

static; peace lies in improvement
and progress, not in the status
quo
which;,; sufficient for

"a day, -will
be; enough tomorrows• It lies

not
in

freedom

and

worship

action, expression
insofar as these do

not interfere with the freedom of

others.

lies

government

*An address by Mr. Reed broad¬
over
United Nations Radio,

cast

Aug. 14, 1947.

est

productive

'-••••

opportunity

and

the greatest assurance of stability.
Peace
in

the

city,

can no

hermit's

the

longer be achieved
the

cave,

walled

isolated

nation, but
must be the product of a world in
or

economic
cord.

well

political

ac¬

We have accepted this; and
on
this principle that the

it' is

United Nations, with its
many
sub-organizations, was establish¬
ed.

of War

1891

18 Clinton St., Newark 2, N. J.

(L. A. Gibbs, Manager Trading Dept.)

that

us,

ingly

complexity of the work
by the International
Chamber, and the complexity of

increasingly large number of and economic system of our own
adherents, but their time was un¬ choosing which give us the great¬

increase

rapidly expanding industry.

Circular

conclu¬

economic

sons

The

home.

dragged

Earlier

stock

mon

than

war

tage

and

undertaken

dent

We need not look far back into

history

studies

international

countries assured of the
impor¬
tance of their work and resolved
to redouble their efforts.

the

modern

"one

met

Chamber's

pursued for two and a half years.
This done, they returned to their

Philip D. Reed

thought

major

matters which they had
earnestly

in¬
b y

believably short for such a large
undertaking. Today, with the les¬

Stocks
in

only

International

Council

sions

was

strument

could

cial

war,

war

the

as¬

leading

the

present to the Economic and So¬

was

course

effective,
from

Montreux, Switzer¬
land, in June to consolidate and

put

practice

Congress

into

captured

Stock Offered at $6

Fire Insurance

Depressed values

idea

this

To make this

trading nations of the world
at

Alexander

the

Jahn & Oilier Common

half of the volume

the

which

"Banking

author

occasioned by changing conditions,
and plainly indicates some of the

thesis.

method

chose

the

businessmen

.thesis; economic advan¬
among nations was seized,

The

Banking and Number of Banks,"
"Banking Assets and Liabilities,"

1945.

The

sistance

"one

world"

as¬

long experience in

economic field.

the

great deal of competition from
governmental
lending
agencies,

ters in Part I treat of:

31,

the

Council be¬

offer the valuable

can

sistance of

other

deals

the

31,

deposits declined from 82%
in 1920 to 17% in
1944, while that
of investments to
deposits rose
from 29% to 66%.

led, subsequently, to

constitutes

2.84

Dec.

in¬

Christ,

orig¬
exponent'*

cause

through

the "business develop¬

exhaustive treatment, nevertheless
his volume is a thoughtful treatise,
it

Economic and Social

be-

the

was

his
The

three

o r e

little

conditions,

commented

reviewed.

is devoted to the general need of
up

lived

Chapter IV, "Political and Pub¬

tude" which

and the decline in interest
are

1944

money mar¬

during

sharp de¬

pertaining to investment
programs are presented and dis¬
cussed, "consumer credit" receives
a good deal of attention in Chap¬
ter XVII and the closing chapter

harmony.

Similarly, the percentage of loans

cen¬

financing.

that the ratio

Dec.

banking.

banker

War

vestments

discussion of

changing
financial
monetary policies and

expense,

ment effort."

rates,

since

been

since

stepping

years,

study.

tury, and their effect'

has

that

rific amount of "deficit financing"
undertaken
during the past 15

the development of
banking system from
early days to the present banking
structure is concisely traced. This
is followed by a synoptic presen¬
tation of changing business condi¬
tions

there

observed

The changing character of bank¬
ing assets, occasioned by the ter¬

book

the American

World

dis¬

essential for all books intended

salary

operations, job
analysis, needless operations, overstaffing, and other personnel and
orocedure problems are surveyed.

ating, accompanied by an increase
in the average amount of deposits
per
bank, even before
Second

Bibliography, and in front, a
Table of Contents.
Unfortunately,
the book lacks an index, which is
for serious

will

cline in the number of banks oper¬

matters

mechanization

on expense

Problems

"Changing Conditions Af¬
fecting Banking," and Part II,
"Adjustments to Changed Condi¬
tions."

succeeding

15,358
22,032

29,829

1944

cusses

the

reduction is especially interesting.

24,630

1932

into

Part

discussed'

are

detail

some

(

inal

items

788

1929

Viewpoint of the Investor."
("Chronicle," 3-22-45.)
book

program
These

chapters. The chapter

1920

the

new

development

9,876

the Position of Bank Stocks From

The

an aggres¬

866

26,505

School

Graduate

business

sive

bar to international economic

centuries

Establishment of

(h)

friend of mine in the International Chamber of
Com¬
merce reminded me
that the famous Greek
warrior, Alexander of
Macedon, who
<$>-

($000)

19,746

Banking. A little over two years
this column reviewed a book
by Warren C. Heidel, developed
from work done at the school, en¬
titled "The Banking Industry and

the

of income

of loans

Per Bank

Deposits

11,406

—

Recently

($000,000

problems and procedure have come
out

sources

now

Council, along with International Monetary Fund, as steps toward
economic cooperation, and holds
varying economic ideologies need

pres¬

(g) Development of new sources

Deposits;

of Banks

Year—

books

from

peace,

Cites work of the International
Chamber of Commerce and United Nations Economic
and Social

(f) Development of other new

regard to the number of

that

time

income

creased

Commerce

of eliminating

strongly desired throughout world.

ent loans

operating in the
United States, the author presents
some
interesting o#|ures
from
which the accompanying table has
been developed:

S. industrialist points out
necessity
economic causes of war as means of
obtaining

ment program

commercial banks

nection with studies at the Gradu¬

Prominent U.

(d) Expansion of deposit base
(e) More efficient computation
of service charges and in¬

visory Attitudes."
With

Chairman, U. S. Associates, International Chamber of

Reduction of expenses
Development of an invest¬

(c)

Structure and Laws," and "Super-

In the

By PHILIP D. REED*

agement

and

Cooperation Versus War

Chairman, General Electric Company

the problem from the

Efficiency in operating man¬

This Week—Bank Stocks
interesting

Economic

would

solution

Thursday, August 21, 1947

that

proposes

following points of view":

(a)

then

reasonable

to approach

By E. A. VAN DEUSEN

CHRONICLE

FINANCIAL

The

Council

Economic

Social

and

seeking to trans¬
late this principle into terms ap¬
now

plicable to the specific needs and
conditions of all nations and all
economies.
Need

for

;
Increased

Productivity

One

principal need is increased
productivity throughout the world.
That means the increased moving
of goods, services and investments
across
national boundaries, for a
cramped area of trade and in¬
vestment
invariably leads to a
cramped economy.
To

realize its full

promise, the
International Trade Organization
Charter,
now
being« drawn at
Geneva, must serve to encourage
this trade increase.
lish

rules

which

It must estab¬
will

allow

the

nations of the world the most ef¬
ficient

use

the

services

and

goods made available by other
nations without economic injury
to any

individual country.

member

government must

by those Yules, keeping

Every

abide

constantly

Volume 166

Number 2622

THE

COMMERCIAL

FINANCIAL

CHRONICLE

(725)

in mind the

long-term advantage
accruing to such a system. This

L\vill

minimize

the

violate the rules
to strained

temptation

the

long

disastrous

subject them

the

other nations.

ITO,

would

run

Specie \
.

interpretations,

With First California

Edwin

which

prove

initiators

NSTA Notes

gomery

depend

the

upon

great

restraint

participation

Financial

With King Merritt

Chronicle

Stengel

Company,

Special to
—

300

& Co.

The Financial Chronicle

First

LOS ANGELES,

ber of Commerce Building.

willing

The

na-

and

golf

statement of the princi.pies and the aims of wqrld eco¬
a

Bond

Club

tournament
F.

Committee.

Brown,

Denver

the

Park

Boettcher

Coppes
holding its annual summer frolic
Hill Country Club on, Aug. 22.

Co.,. is

Chairman

the

Frolic

COLO.

has

with Peters,
sen,

Inc.,

With Butterfield & Co.

The Financial Chronicle

DENVER

BOND CLUB OF DENVER

measure

and

the member

Peters, Writer Adds

Donald

Ward

—

become

Special

National

The Finvncial Chronicle

Butterfield has joined the

Writer and Christen-

JACKSON, MICH. —Jack Van

connected

staff of

Butterfield & Co., Jackson

H. H.

Bank

City Bank & Trust Co. Building.

Building.

nomic cooperation
serve, however,
as
a
dangerous over-simplifica¬

tion, for

they

are

widely

ac¬

cepted
that they may
become
catchwords without
meaning. One
; might well ask why this economic
cooperation
is
not
arrived
at
.

straightaway, since human desires
not

vary

over, and

greatly

the world
nation cannot long

one

"maintain

prosperity

"expense.

The

world

another's

truth

that

economic

the

hodge¬

podge, representing all degrees oi
economic development from sim¬
ple handicrafts to whirring fac¬
tories. In such a world, the sim¬
plest and fairest trade rules wilj
function

not

the

greatest

im¬

mediate advantage of all people at
all times, even though

they

may

good for everyone in the long
run.
It is inconceivable that a
'

completely uniform rate of eco¬
nomic progress can be maintained
in all localities at all times. For
these
reasons,
adequate
rules
which
are

cult

can

Few would listen to him...YET—

universally accepted

—far too many

difficult to arrive at and diffi¬
to maintain.
But we must

on sources

keep in mind the alternatives;
adequate international trade rules
freely adhered to, or national
of

-rules
•

thumb

which

set

would

co¬

realistic

un-

it considered

tries

have

the several

determined

They act

future

framework

public

policy

promise

bank, utilities, transportation
tems

and

dustries

the

;

hands;

all-tout

and

state

the

system.

Each

On what,
a

opportunity

;

however,

observe

„

.will

make

difficult

; tainly

economic accord

;

readily

and

the

its operating ability, its competi¬

position, its prospects... and to arrive
reasoned investment decision,

for many years,
to make more

through the Economic and
Council, the International
Organization

company,

The New York Stock Exchange

cer-

led

..,,tm

has,

successful movement

information available about

its listed securities. The facts are

seen,
then,
cooperation

achieve, though

obstacles

good judgment, based upon facts.

tive

less necessary.

can

the

then, should the person who seeks !

Given sufficient factual information, it is

Task Difficult

that

1 ;'"•••

possible to appraise the financial condition

their

The very existence,
these three systems

riches—something

legitimate investment depend? On facts.

and
accomplishments
carefully and determine which isr
after all, best suited to
supply

man's needs.

easy

these

operation

quick,

and

systems cannot be best and it may
prove fortunate
that they exist
side by side, for it will give us all

.an

of securities. Such tipsters may

you

circumstances.

any

in-

third

producing

willing to predict the

sysr

basic

state-controlled, with

are

trading
.

other industries remaining in

(private
.

one

are

of. almost every thing-including

responsible adviser would do under

one;
another
is
the
so-called
mixed economy where the central

course

the prices

cations: free enterprise within the

•

"tip sheet" lures of self-

styled "experts" who

gain
man's economic wants and aspira¬
tions. At present they can be di¬
vided roughly into three classifi.

upon

na¬

coun-

•

■

worthless tips

friends-even from

strangers who may not be so well-meaning.

;

economic

tional systems by which the
v

the people who accept

—from well-meaning

discussion

operation
less

are

reliable than the fortune-teller!

way

war.

Varying Economic Ideologies
^

These

people depend

of financial information which

are no more

nation

against nation and mark the
toward

to be found in

Social
Trade

the reports of listed

companies, in data filed with the

Bretton

Woods Institutions

are

nearly

New York Stock Exchange and

the

great

as the goal to be achieved.
Success will require the best ef¬
forts of each nation and of each

individual;

U. S. Securities and

endeavor,

said

earlier

that

our

not

parallel.

must make great efforts to

1920's. It is my sincere hope that
the International Chamber can as-

We urge you to

make use

of this information.

New York Stock Exchange

sist
the
Economic
and
Social
^.Council tin
demonstrating • that

t 'r-

sound and wise economic
policy all j nations can move rap¬
idly forward to a better world.

Firms

of this Exchange.

ensure

that the next decade does not follow the unhappy pattern of the

^through

newspapers,

present

position is parallel to no period
1 of past history. I should have said
that it need

of the

and in the offices of Member

lip service might well be termed
disservice.

Exchange Commission,

in the financial pages

to offer less is to offer

little indeed. In such

CALIF.—Allan
H. Seaman has joined the staff
Mont¬
of King Merritt & Co., Inc., Cham¬
..

with

Street.

Special

lions.
Such

The

California

will

FRANCISCO, CALIF

The success of the

that of any organization
whose
members
join
together
freely for their mutual advantage,

JSAN

-.i.

THE

(726)

COMMERCIAL

FINANCIAL

CHRONICLE

Thursday, August 21, 1947

Leading the World in Achievement
By HON. WILLIAM F. KN OWL AND*
U. S. Senator from California

Senator Knowland accuses Russia of seeking European collapse and warns only hope of free men
everywhere is continued prosperity in U. S., the one stabilizing force capable of saving world from
economic and political chaos.
Reviews legislation of 80th Congress and upholds Taft-Hartley Act
as measure insuring continuous operation of our
economy, Decries veto of tax bill and wants housing
problem solved by localities and not Federal Government.

attracting considerable
attention in recent months and there are a number of rail analysts
who consider it about the most attractive lower priced issue for
Illinois Central

stock has been

common

It is conceded that there is probably
this
relation to the vast improve¬

speculative trading purposes.

little hope of any dividend income for some time to come, but
as a minor consideration in
there has been in the fun-S>

appears

ment

damental status of the shares and
further

the
for

the

over

looked

improvement
near

and intermediate

ably higher.

terms.

Illinois

did

Central

the

ihost

not,

former

so-called

"marginal" roads, even resume
dividend payments on its shares
during the height of the war
boom in earnings. These earnings
were utilized, rather, for financial
rehabilitation, property improve¬
ments, and reduction of debt. The
latter, at least, continues as an
important factor in management
policies. During the years 19411946, inclusive, the road retired
more
than $97 million of nonequipment debt. By the end of
last year this non-equipment debt
had

been

reduced

million.

below

Moreover,

nounced

$218

was

time

ago

months

some

the first five

an¬

that
the

some

the management has been concen¬

trating on reducing shorter term
obligations.
At the end of last
year more than half of the re¬
maining non-equipment debt was
maturing in 10 years. One diffi¬
culty has been that the major por¬
tion' of

this

debt

was

out¬

standing $50,319,000 of non-call¬
underlying liens maturing in

able

years

another

1950-1952.

There

was

$33,475,000 due in 1953,
$31,550,000 of re¬

and in

1955 the

funding 4s and 5s mature. A large
part of the early 1947 bond pur¬
chases

was

concentrated

the

refunding mortgage bonds. Many
analysts are of the opinion that
these
particular bonds may be
eliminated entirely over the rela¬

tively
vastly

near

future.

improve

six

17.8%

earlier.

year

This

the

for

revenues

months

above

the

operating
from

ratio

tern of Constitutional Government

and

the

81.9%

the other

50%.

74.9%.

hand, jumped

The net result

Taxes, on

earnings

than

was

common

$5.70

the

for

period compared with only $1.29
in the first half of 1946:

Normally Illinois Central
in

the

opening six months.
for the

average

1932-1941

earns

than in

half

second

On the

10 prewar years

just about 60%

operating income

of net

would

whole

accrued in

was

July-December period.

not

1947

earnings

share.

look

top

$15

The road gets quite a vol¬

ume

would

If it did,

traffic

corn

that

for

uncertain.

this

crop

Also,

the out¬

and

there

year

little

with

respect

the

Over

period of

has

had

least part
year

until

the

considerations, rail
look

the

year

Even allowing for these

for

1947

averaged
low of

$6.81,

$0.08

generally

men

earnings

the

least

share. The stock recently has been

selling

just

three

about

ranging

high of $17.68 in 1943.
for

the

present

from

in 1938 to

indicated

fixed

Fund Head So Consult

„

our

and

economy

abroad

solvent

un¬

sound national

Federal

Camille

Gutt

Paris to

goes

European nations
program

recov¬

That

why

there

concerted movement

exists

by the

the

com¬

munists and their fellow travelers
undermine

confidence

McCloy, head of
World Bank, pledges cooperation.
It

announced

was

that

on
Aug. 15
Gutt, General Man¬

Camille

ager

the

International

Mone¬

assistants, was
leaving
for
Paris

gress and our constitutional proc¬
and to encourage disruptions

national

our

economy.
The
Kremlin knows that an American
economic

collapse

would lead

sult

with

this

chaos

the

are

time

be increased to
$9.76 and the 1938

European

results

nation

stabilizing force

one

the

rehabilitate
nation

one

moral,

itself

with

economic

torn

war

and

potential

military resources to enable the
loving nations everywhere

peace

maintain hope that a system of
international law and order may

yet be established.
I wish I could

mittee

bring you a more
picture.
In candor I

one

Yet
of

do not

believe

peace

by any

know
no

that

the

hopeless

We must

means.

seek

economic

con¬

conquest,
political domina¬

with what happens elsewhere. On

July 29, Russia exercised her veto
for the eleventh time in the Secu

rity

Council.

This

not

con¬

ducive to mutual confidence

that

desperately

$4.20.

38% tax rate
interest

Even

were

savings,

earnings

for

1938

would

$2.60

work

the full

applied to the
the

the

pro-forma

recession
out

year

above

was

for

covery

needs

now.

and without the benefit of
any net

Federal income tax credit
Illinois

readjustment

year

1946,

Guaranteed Stocks

end

Camille Gutt

part

drawn

the

Fund,

g^netal plan

Nothing was
regarding the
International Monetary
up.

stated

which

makes

/temporary

loans to member nations to
equal¬
ize exchange
rates, will play in
the

forthcoming

proposals, but
inasmuch
as
John
J.
McCloy,
President of the World
Bank, has
CUARAWTEED RAILROAD STOCKS-BONDS
25 Broad Street

New

York 4, N. Y.

Telephone BOwling Green
9-6400
Teletype NY 1-1063

These

ground

which

definitely

Special Securities

the

already pledged the

Bank's assist¬

ance, it is expected that the
part
to be played
by the

the

under

are

resentatives

ing

the

mained

International Fund in the

covery
in

the

program

will

discussions.

re¬

outlined

that

faced

back¬

your

when

rep¬

they

as¬

months

they

re-

session.

the

adjournment

"va¬

Most members will be

busy in

their home states and
districts

they

were

will

have

Washington.

important

Many

committee

*An address

San

the

by Sen. Knowland
Commonwealth Club

Our state has not yet
celebrated
its centennial as a member of the
is

not

A hundred

years

nation

bad
ate

Republican1 who

was no

been Chairman of

ever

Sen¬

House Committee.

There

are

complain

who

legislate

takes

time.

Of course it does.
The sys¬
tem of representative government

meant

amount

take

reasonable

for

time

views

the

■

into

action

For

the

years

under

was

houses

and for final congres5on the bill.
,

agreement
sional

the

month

the

government

domination

strong executive branch. So-called
"must legislation" was rushed up
to Capitol Hill and
many times
passed without adequate considerr
ation or debate. Tnen the critics

the

quote:

first

amount

public

debt

due

rubber

stamp and

as believers in the
stitutional balance of powers

der

our

republic

all

con¬

un¬

Americans

In the first

two

life

year

made

months of its

seven

the

80th

Congress

constructive

addition

record.

reorganizing,

the

How far

have

come!

fighting World'War II,
debt

$258

now

modern

billion.

entire

public

rier

Succession

President

large aircraft car¬
Midway class costs

the

total

our

debt

$100 million

almost three times

1847

eral Public

public debt!

The interest alone

Debt

the Fed¬

amounts to

now

approximately $5 billion which is
larger than
of

the

total

Federal

time

peace

Government
1933.

certainly time for the
American people to stop, look and
listen.

relatively good

make

must

is good enough

and

years we

reductions.

record

Our

enough to

poor

past

encour¬

cause

us concern.
During the 154 years
since 1792 through 1946 we have

had

a
net surplus
Budget* and 62

Federal

with

net

deficiency.
budget creates debt when

The
we

with

years

our

taxes.

Presidential

One

battleship costs $80 mil-*

Polk's time.

Unification of the Armed
new

After

public

our

lion, which is almost double the

following legislative measures of
major importance were adopted:
Labor-Management Relations Act,
a

4th

$27,870,859.78."

years

Services,

the

age

should take pride in this fact.

public

consequently the addition made to
the public debt since that time is

in any year prior to

was

the

March, 1845, including Treas¬
ury Notes, was $17,788,799.62, and

cost

Congress

present

tion,
80th

the

actually incurred, including
Treasury Notes, was $45,659,659.40.

were

complaining, with justifica¬
about the "rubber stamp"
action by their law makers. The

were all

expanding

debt

committee

two

about

"On

The

critics

some

that

President,

Congress and the nation,
national debt!

engaged
The

concerned

the

Sixteen

had passed since the Repub¬
last
controlled
Congress

and there

then

was

the Mexican War.

both

Senate.

spend

more than we raise in
This has been the situation

during each t>f the past 16

years.

Act, Greek-Turkish Aid, Termina¬

tion of

in 1940 it had grown to
$42 billion
and in 1947 it amounts to

vast number of

war con

trols, Portal to Portal Pay Act,
National Science Foundation, pay¬
ment of Terminal Leave
Bonds,
and

two

of which

ident.

tax

reduction

were

This

vetoed

session

bills

also

ratified

Bulgarian, Hungarian, Italian

and Rumanian Peace Treaties and

submitted to the states
tutional

Amendment

President to

two

addition
of

Consti¬

limiting

terms.
the

Congress

1930

above, both

administration

spokesmen claimed was
bottom figure of $37 y2

Subsequently,
mental

budget

billion.

sent

figures

rock

supple¬
to

Con¬
ad¬

ditions to his original figure.
The Fiscal

12 major appropriation

1948,

stantial

the

this

year, the
had its first

that

there will

surplus.

There

Junb

sub¬

one

en¬

expanding tax receipts' ovetf
above
Treasury ^estimates.

Part of it
of

high

war

the

for

time

reduc-*

the

from

the

very

and

levels

part

Congressional

additional

cut

gress

from

comes

expenses

from

the

demands
economies.
Con J

"roc#

President's

bottom"

budget of $37 xk billion
by approximately $3Y2 billion. - ■
The peacetime cost of govern¬

ment

believe
20%

Policy

The 80th Congress acted

indication

every

tion

The President submit¬
some

budget surplus since 1930.
is

time and consideration to the bud¬
get and the necessary appropria¬
what

Budget Surplus

June

Federal Government

and

ted

$16 billion,

was

$253

First

much

bills.

debt

titled to all of the credit for this*
condition. Part of it grows out of

gave

the

billion.

both

by the Pres¬

gress which made substantial

cation" in any sense of the word

before

years

the

time to this subject.

some

change in

the

and

Houses

operations of

the

membership

House

obliga¬

Washington and dur¬

seven

Nor is

the

substantial

tion

some

our

Federal Union.

Congress

complicate the matter there
been

Nations

our

United

folly.

problems

sembled

our own

To do less in this period

would be
'

adequate Air Force,

Charter.

time the outline of
will

Bonds

tions

will ex¬
tend
two

weeks, at

requires that

security and to fulfill

stay

the

*-j

obligations at
home and abroad, I wish to devote

our

lad

the
sense

Army and Navy both for

economy. It is
expected that
Mr.
G u tt's

our pow¬

dry.

maintain

the

and work

pray

shall keep

Common

re¬

but like the American

peace

der

European

share.

continue

Pioneers,

engaged

preparing

plan

shall

80th

•—

out

carry

long time in the history
of civilization. How much we
have
January 3, it was ' immediately
grown as a nation can best be
faced with carrying out the sounderstood
by reading a para¬
called
LaFollette-Monroney
rer
graph from the third annual mes¬
organization bill. In the Senate,
sage
to Congress by President
for
example,
this reduced
the
James K. Polk. It was on Dec.
7,
number
of
standing committees, 1847
(not quite a century ago) and
from 33 to 15.

has

cannot be unconcerned

~—

When the 80th Congress met on

tion of other nations.

But

Problems

sufficient

and

com¬

Con¬

hearings in the House and the
and Senate, for debate on the floor,
for conference action to
bring the

Europe

dapable of helping the

the

that the

both economic and

the type of co-operation the world

con¬

and

when that body next assembles.'

in Con¬

esses

John J.

ery.

individuals

gress will have more information

licans

Government.

stantly strive toward that goal in
the hope that people everywhere
will
someday, somehow get to

but without

re¬

maintain

cause

tary Fund, together with several

allowing for the

catas¬
far

cannot carry our

obligations at home
less

cannot.

charges of just under $11 million,
sulting heavier tax accruals, the
10-year average earnings would

America. Yet

optimistic

mmm

Adjusted

that

The hope of free men every¬
where is still the United States of

times

prospective results.

committee

should

and

trophe
occur
would
have
reaching repercussions upon
own way of life.

neighborhood

meet with

share earnings

educated and in-

world

Europe,

world

late

earliest.

rate relief looked for

highly erratic

common

the

which,
if
suc¬
cessful, will mean the economic
and political collapse of western

of the last half of the

with

For the 10 years

earnings record.
1927-1946

Illinois

system

upon

Asia.

maturity

years

the

saddled with heavier wages for at

problems of the road.

Central

rest

Tremendous forces are^at work

political

debt

apprehensions there may still

enterprise

necessity

assignments to carry out so that
they will be better prepared as

erested electorate.

doubt but that all carriers will be

picture and pretty well eliminate
any

free

foundation of

lively that this seasonal pat¬

tern will hold this year.

the

must

points,

seven

The contin-^

of the American sys-

success

addition,

some

holders alone.

office
ued

are

year

level

the

people who question the ability of representative constitutional gov¬
ernment to meet the problems confronting us.
I believe our system can better meet the
challenges we face than any other system yet devised by man. But it cannot be done by

management was able to cut the

non-callable.

As of Dec. 31, 1946, there

the

first

ran

the

debt retirement, program

its

the

Gross

cur¬

rent year a further cut of
$6 million had been made.
In

Central
reported
net
income
equivalent to $4.67 a share. This
year's results should be consider-^

There

still
we

too

can

our

high.

continue

national

do 'not
take

income

Federal taxes without1 serious re¬
on

the

bills, three

percussions
tem.

our

economic sys¬

supplemental bills, and the earlier

deficiency and recission bills.
Since I strongly believe that
sound fiscal

Francisco, Cal., Aug. 8, 1947'. Government

policy by the Federal
is essential if

are

the last full

war

year,

fiscal

1945, government spending passed
the $100 billion mark. Down to a
figure of $34 billion is a substan¬
tial

reduction

(Continued

in
on

two

years.

page

36)

A
,

Number 2622

jVolume 166

THE

COMMERCIAL

The Task of World Peace

opposition to it

By ROGER W. BABSON

holding war is noW intolerable, points
be successful only as new institutions for

can

with international problems develop.

ports," but

Stresses place of

United Nations as a moral force to drive nations into following
policies of justice, righteousness and concord, and urges improving
international procedures within United Nations framework. Holds
world government not yet feasible and scores Russia's policy.

wanted

warns

visit

people

are

perhaps

feeling.

suffered

ponderant human wills.

also

pious hope.

thou-

sands

perfect

each

considerations

make

Admiral Mahan who said that

President

nothing new in such dualism.
It has existed since, in the begin¬
ning, man ate of the tree of
knowledge of good and evil.
But
never has it seemed
so impera¬
tive

that

and

that

should dominate
of peace should

good
ways

supplant 4he ways of war.

consolidate

and marshal world

They did that through great
statements of aims, such as the
Points and

which

conscience

things which had to be

some

again,

say

great

idents.

Pres¬

war

The world demands lead¬

the way of interna¬

done.

tional

change

was

ership which will frame issues and
there was no organize moral power, not to win
other way.
By war great empires war, but to win peace.
rose and fell and the map of the
It may be said that in time of
World underwent constant change.
war. the moral issues seem clearer
That was not a good way.
But, than
they really are, that ,there is
On
balance, men created more
an
exaggerated
sense
of
selfthan they destroyed.
A new civi¬
righteousness, that the need of
lization did develop on the ruins
discipline and sacrifice then pro¬
of
Greece
and
Rome, and the
vides a spectacular occasion for
world's population did multiply
displaying the weight of moral
and enjoy greatly increased wellpower and that war provides more
being.
exciting possibilities of
change
It seems, however, that war and
than does peace;
All of that may
Civilization can no longer go on be true.
Even so, it does not dis¬
together.
Under modern condi¬ prove our estimate of the power
tions, war destroys more than of moral force.
It only proves
peace can create.
Efforts are be¬ that, in war, there is an alert and
ing made to outlaw some of the effective use, perhaps misuse, of
new weapons.
But science makes moral power, By contrast, during
possible destruction so vast 1 by peace, the moral issues usually
means so varied that it is unlikely
seem
blurred and moral forces
that war will again be a socially are
quiescent or so confused and
tolerable institution.
That prob¬ divided as to " be impotent.
It
ably is

to War
.

That

conclusion.

But that,

first

alone, is not

enough.
If an institution plays,
though badly, an inevitable
r-ole, you cannot simply abolish it.

even

You

put, something in its
Even those who hate war

must

place.
the

most

that

little

the

must be

that

law.

Pact

abolish

war.

•

The

Work.

but

Kellogg-

The

sought

merely

will

That

never

task

positive.

not

negative,

calls

action.

velop peaceful

Men

ways

irtternational position

sacrifice

the

Nations
Pot

The

prior
as

for
must

con¬
,

de¬

whereby the
can

be kept

address

Mr.

was

Dulles'
to

Delegate

Assembly of the United
and

munism

England

else¬

and

savings bank. He asked
how much money

What About Business?
truth

the

that

usually carried in her

women

entire

United States—as President Tru-

four

five

pocket-

II? These

"About

replied:

usually

dollars."

offer to sell nor a

of these securities. The offering is

then

them to count how

asked

This advertisement is neither an
any

The' United Nations

very

much

Special to The Financial Chronicle

CHICAGO,

Coutts has become associated

Graham,
La

Salle

Parsons

Street.

Co.,
was

solicitation of an offer to buy

Engraving Company
(A Delaware

Corporation)

Common Stock
(Pa^ Value $1.00 Per Share)

Moral

Men

Price: $6.00 per

represents

official, views.

personal,

are

Copies of the Prospectus may
as are

be obtained from such of

the undersigned

registered dealers in this State.

effort.
;

President

(When

Prime

the

Summer

Roosevelt

Churchill

Minister

their peace aims they failed to, in¬
clude
world
organization as
peace

goal.

Charter

was

ject.
It
churches

was

So
silent

the-

•

which

this ^sub¬

C h r i

then

t i a

struck, the

zation.

United

States

Then

ofherTre^

Link, Gorman &

the Foreign Min¬
Three announced
cn

Co.

enyart, vancamp &

page

co., inc.

incorporated

kirstein & co.

Bradbury-Ames Company

up^entiment

isters of the Big

(Continued

Straus & Blosser

Frank & belden, Inc.

Butcher & Sherrerd

to make good this grave omission
It took a little more than two
years.

Buckley Brothers

blow for world organi¬
Working in uttiscrfr,\in the
and

Company

INCORPORATED

Atlantic

the
on

Sills, Minton &

define

1941

anc

met

reed, Lear and
August 21, 1947

37)

\
*

with

135 S.
previ¬

ously with C. F. Childs & Co.-*

made only by Prospectus,

Company

ILL. —Ronald

Jahn & Oilier
•

from

different

102,000 Shares

Mechanism

sud¬

With Graham, Parsons

woman

book before Wbrld War

where.

The

she

namic faith.

countries, they built

designation

New

leav¬ Socialism.

righteous and dy¬

and a

Aug.

prepared

come

as men

first strong

1947.

each

for war, the finest human
qualities.
Peace, no less than
war.
requires idealism and self-

*An address by Mr. Dulles be¬
fore the World Convention of the
Churches of Christ, Buffalo, N.Y.,

ing his

should

Gallup

ters

will

The world will

changed.

structive

apply to most manufacturing cen¬

take

Poll of the next 100 women

that

beginning to find the
way to make normal power work
years ago or even 50 years ago.
during peace to preserve peace.
( There must be either a peaceful The present United Nations or¬
Way of change or a violent way of ganization is designed for that,
change. In a living world that is largely as a result of Christian
Briand

Bridgeport,

enough to

banker

reserve,

political changes wrought by past
Wars and restore the international
position of 500 years ago or 100

inexorable

un¬

Certainly if this

wherewith To

remains
peace.

have peace so long

never

it
cancel out all of the

panic

The

think

impossible

how

see

Would be

applies

unless

people and get out of debt.

in circulation had tripled denly "like a bolt from the blue."
from $8/000,000,000 in 1940 to over Although our domestic situation
$24,000,000,000 today, asked a lo¬ is good, the foreign situation is
cal banker: "Why am I not three
very bad. There are no prosper¬
times as rich now as I was seven
ous "Bridgeports" in Europe. Com¬
years
ago?" This interested the

forecasted for
and 1947, but this has not
about. Bridgeport continues

to be prosperous.

all

money

was

though war had a near
monopoly of moral fervor and
mold

is intolerable is

war

1946
come

who
States

United

the

that

for

many

other

socialist,

-Bridgeport

knew

to be optimistic

"Bridgeports" in the
United States, although sometime
there will be a day of reckoning
the

for

peace

difficult and much

disappointed bears.

Bridgeport Story

Ahead

Looking
continue

seems

Peaceful Change the Alternative

was

employment

and

final verdict.

ucts

even

now

munition

war

want

thing are

times.
Hence, it was and is a war city.
The conversion to peacetime prod¬

have

now

profits did a safe thing; but
the "smart ones" who sold every¬
their

this a large center for
small machinery and tools of all

only

said

But,

why do

is because

highest point of the year.
Investors who cashed in half of

kinds, but it makes guns and am¬

Presidents.

elsewhere and

these people vote
The answer
Bridgeport has an hon¬
est Mayor Jasper
McLevy, who
leads the Socialist Party but who
But

the socialistic ticket?

the

world.

the

formerly carried.

The stock market is now

timism.

the

aging 12 to • 15 dollars in their
pockets—or three times what they

people

the Atlantic

appealed

Thereby they became great
long time war has been

accepted
institution.
Crude
and unchristian though it was, it

During the recent war these
prospered
greatly.
Not

feat.

moral

II,

government.

sentiment to insure Germany's de¬

Charter,

Institution

and one suit of clothes and change

of Bridgeport were aver¬

women

neither

World

Fourteen

War Now an Intolerable

"iFor

tions.

later

Wilson, after the be¬ and has had the vote of many
World War I, and conservative people. At one time
President Roosevelt after the be¬
Bridgeport' was the only city in
ginning of World War II, did much New England with a socialistic
ginning

deposit.

root."

Dulles

John

There

did

mere

physical force was useful only "to
give moral ideas time to take

ways

mass.

three-fourths of the game."

was

destroy
other in

That is not

It is the judgment of

moral

war,

are

working

feverishly

tion—

people seem
economizing during vaca¬
They take only a $20 bill

after

truly loves the people. He looks
at every boy and girl as if it were
his own boy or girl.
He has a
heart, generous with the poor, en¬
forcing the laws and especially
protecting youth. He is more than
When- the stock market was at Mayor of the city; he truly is the
Bridgeport
a
low ebb—some months ago- loving father of the city and all
is
a
city of
its people. Let us not think only
Roger Babson
about 150,000 many readers criticized me for
of money when people talk So¬
people. These being optimistic during the early
months of 1947.
They felt that cialism. There are many things
people have had a reputation as
being radical and for many years my forecasts for a "good 1947" much more important than money
would
be wrong.
Each month, by which cities and people should
have
elected a ^socialist mayor.
He, however, tried hard to be fair however, has confirmed my op¬ be judged.
^

every realist throughout history.
It was Napoleon who said that "in

many

lands

Too many

now

bank

during the trip!
This,
however, is not a bad sign. These
are
saving
money
for
writing
from people
something which will last longer
that place.
and
perhaps give them a little
A Typical City vacation each day of the year.
War

be the most powerful force

can

in the world.

do
not forget that
here,

e a c

during

assuming control of the situation.

meet

<we

Action and

most

Moral power is quite capable of

But,

brothers.

occurred.

prospered

all men
made

are

Newton's Law

had as they left the
making their weekly
He found that all the

they

high. We have more
employment
and
greater
sales
today than ever before in our
history.
The only disappointed
people seem to be those of some
summer resorts who had planned
on
a
record year which has not

then—ac-

cording

Moral Power Adequate for Peace

of other people and get

at an all-time

of the Thirties

think

has recently pointed out—is

man

the depression

and

England
Bridgeout of debt.

typical^

As Bridgeport
most through

whose Father¬

hood

day of reckoning unless

some

New England City to learn how its

This is an inspiring occasion.
Here a great company, of many
thousands, representing many lands, has been drawn together by a
common
be¬
in reasonable accord with
lief in a God
pre-

through

(727)

Mr. Babson describes prosperity of Bridgeport, Conn., as typical manufacturing center in New
and elsewhere. Praises Socialist Mayor of Bridgeport, and expresses optimism "for many

Prominent peace advocate,
out

CHRONICLE

Bridgeport and Socialism

By JOHN FOSTER DULLES*
U. S. Delegate to United Nations General
Assembly

coping

FINANCIAL

(728)

THE

COMMERCIAL

FINANCIAL

while Income

Series has been

the market since

CHRONICLE

policy is to keep all three funds
fully invested, although the per¬
centage invested in equities will
vary from time to time. A great
investors

many

scious

By HENKY HUNT

the

becoming con¬

are

of bal¬

advantages

anced funds.

Diversify Thru Mutual Funds
The investor with only five or ten thousand
dollars of surplus
proper diversification of risk but seldom obtains it.

Abe

Far too often he pours his entire
Even if he tries to select sound

savings down

individual securities, his judgment

the advice of friends

unsound.

proves

tive advice

can

frequently

Even

conserva¬

costly.

prove

For

example, if an investor decided
to buy an automobile stock
early
in 1942, his banker

BUILDING

properly

have

his money into General Motors. The

result—General

Motors

advanced

automobile stocks from
lows to the end of 1946.

Similarly, if
ing for

Alone."

preferred

stock

that

6%, he might pick

yields 5
good

Wife Like

one—

from

your Investment

request

dealer

business offers such

Distributors Group, Incorporated

choice

with

that

but

few

obtain

can

not

wide

the

even

thousand dollars

only

the

type

of
securities he wants but also
diver¬
sification running into
hundreds

63 Wall Street, New York
5, N, Y,

of different issues

ting

his

merely by split¬

capital

among

half

songs.

song

caption, "Key¬

1934, the trustee re¬
sponsible for $100,000 of capital in¬
obtained

high-grade bonds and
yield of 5%—or $5,000

income for the trust.

based
with

in the cost of

does

not

guarantee

same

itself

satisfactory

investment results, diversification
on expert selection
together
continuous professional su¬

Manhattan

pervision of the portfolio

should
afford better results than the
in¬
vestor

Bond Fund

to his
of

expect to obtain left
devices. As an executive

leading mutual fund puts

$100,000

income
about

fore,

invested

living each of these

dollars

has

shrunk

$0.66.

"In

can

own

one

purchasing
the

$5,000

there¬

power,

income

has been reduced to

1934

$1,600 by these combined factors.

the investor's objective."

trustee, who is responsible for pro¬
ducing satisfactory income for in¬

National Has Three "Balanced"

stitutional

dependability to

Funds

HUGH W. LONG & CO.
)N<OR*O«AU0

48 WAll

anced

funds,

each

STREET, MEW YORK 5, N Y.
CHICAGO

with

its

'nvestment characteristics,

lows:

Approximate

Funds—

tOV ANGtUi

Securities & Research

Corporation now has the distinc¬
tion of being the
only mutual fund
sponsor with three different bal¬
%

Balanced

4'to

series

series...,

Institutional
ries

were

conditions

■

upper

declining

higher costs.

"An

tees

increasing number

has

placing
funds

solved

part,

this

other

return

Good

of trus¬

problem

not

all

classes

preferred
stocks,
and
stocks which produce

Medium

out

the

individual benefici¬

and nether millstones of
dollar income and

High

Balanced

brought

fol¬

Quality

of Portfolio

and

own

Ave.

Return

Institutional series
Income

these

aries, is caught between the

National

Prospectus from your Investment Deoleror

"Under

by
the

bonds,

rate

larger than that obtainable

highest-grade bonds.

recently

of the risk factor
be achieved
by wide diversi¬

can

fication, careful

out

public favor at this

Shares and Petroleum
also

rose

selection and in-

are

duction

industrial

since

production

1938

will

bear

tons.

This

1938 rate and 120%
the end of the

Car

the

production

of the

1938

June

Truck
Merchant

171%.

was

figure.

shipping under construction
238%

of the

Coal
still

1938

figure.

production

below
for

year

was

86%

this
of

is, of course,
output.
Pro¬

prewar

duction

the

was

first

six

the

months
average

1938

162%

The

yarn

transfer

your

investment dealer,

NATIONAL
RESEARCH
120

york 5. n. y.

Prmprcfus from
or

COMMONWEALTH

of which is managed independently of the
others,
may he obtained from the undersigned

INVESTMENT

Xke

Keystone Company

VANGE, SANDERS

ot Boston
50

111

COMPANY

YORK

Broadway

South

LaSalle Street

;

•

'•

Request

LOS
zio

ANGELES

West Seventh Street

GENERAL DISTRIBUTORS

NORTH AMERICAN SECURITIES CO.
2500 Run

Building

Son Francisco
4, California

in¬

How¬

gradual increase
of

workers

ard

The output

meanwhile

significance

al¬

if the

Britain's

in¬

creased

productiveness is to be
appreciated. As stated, the "Economst" estimates that the

the
10

British
to

But

number

women

output of

community
higher than

20%
the

from

1938.

and
civilian employment is
men

only 1 to 2% higher than in 1938.
These
much

workers

include

higher percentage of
older

than

men

still

under

has

very

women

1938.

some

1,300,000
arms, as* against 480,war

and

the ranks

civilian

employment are kept
only because of the willing¬
of women and of
many older
to respond to the govern¬

Unem¬

disap¬

understand why Britain should be
in the middle of a first-class eco¬
nomic crisis if her production is
in such

healthy,-condition.

is that the

and

foreign as¬
debts.

enormous

the

The

left Britain

war

owing huge

war

could
actual
amounting
to
only one-half of her actual physi¬
cal imports.
The other half was
made good by "invisible" exports
—in other words, by the income
from foreign investments and by
payment for services such as shipping and insurance.
Now, if Britain is to import as
war,

comfortably
get
physical
exports

much

★

CHICAGO
lio

Fund

with Redeemable Shares

Prospectus

BOSTON
NEW

Diversified Investment
*

DEVONSHIRE STREET

Congress Street

Boston 9, Massachusetts

COMPANY

•

A
1

war

power need to be examined

full

Before

of any of these investment funds,

the

ready 122% higher than in 1937.
The figures of Britain's man¬

sets

(Series SF-S2-S3-S4)

war.

rising.

yarn

stripped of

^Modton &und

COMMON STOCKS

local investment dealer

Many people find it difficult to

CORPORATION

broadway, new

the

number

rayon

answer

your

production

from

SECURITIES

i:i

due to the

ment's appeals for labor.
ployment
has
virtually
peared.

from

level.

drop

55%

was

textiles

during

there

the

only

This

from

dustries
ever

men

(Series B1-B2-B3-B4)

to the shares

still

was

prewar rate.

ness

request

actu¬

was

prewar

important

000 before the

Investors Second Fund

relating

the

for electricity.

most

Britain

Massachusetts

each

electricity
of

production is in the cotton mills.
May the production of cotton

men

upon

Supplies.

gas generated

of the rate at

war.

production

103%

127%

was

and

239%

and

trial
production, those of steel
output are probably the most sig¬
nificant.
A
record
annual
rate
lion

coal

made

summer
months,
always down, is still 127% higher
the prewar average for
gas

comparison

mil¬

has

Production in the

Britain

reached in June of 13.2

generation

than

with any country in the world.
Of the latest figures of indus¬

was

1938

ally

increased

possible

161% of the monthly average

was

aggregate out¬

the

The

electricity

put of-The British community to¬
day is from 10 to 20% higher in
volume than it was in 1938.
that

exports.
and

heavy demands on
January this year

does
not
publish an
production
index,
as
many countries do, but a
wellknown
financial
weekly,
the
London
"Economist," last week

prewar

been

the

coal

Britain

means

curtailment of

through

gas

over-all

This

almost

only

the shipping under construction
throughout the entire world.

estimated that the

—

there-

was>

continued at
levels.
This
has

than half

——

has

and

prospectus

in¬

fore, not greatly reduced.
Consumption of coal in Britain

is much higher and
shipping under construc¬

tion in Britain is

9U^U^ Per manshift

record

production
merchant

Prospectus

purchases

Mining, and Hooker Electric.

Pro-<£——

outout.

steel reached

annual
rate.
Car
production is
higher than before the war. Truck

INVESTMENT FUNDS

(Series KI-K2)

stock

British Information Services says increased industrial
production in
Britain since 1938 compares
favorably with that of any
other country.

^sHassachu setts Investors Trust

PREFERRED STOCKS

$20,860,000 to $21,730,000.

Great

BONDS

Changes

Reports Britain's Output Hits New High
Despite Crisis

OF BOSTON

from

stake

Bond Fund

investing their capital

wag

holdings
Solvents, Decca
Records, Douglas Aircraft, Home-

full

Certificates of Participation in

Dow-

Average

cluded additions to their
of
Commercial

highly favored."

figure.
The number of workers was
715,000 as against
782,000 in 1938; the

Ulje

Funds

in¬

money.

Common

time,

being

During the month of July, net
assets of
George Putnam Fund

bargain levels for
long-term investment. Automobile

rate

c ustooian

Industrial

Putnam Portfolio

appear to us at

eystone

May,

165, Affiliated Fund bor¬
rowed $1,000,000 and
bought equi¬

Aviation Shares and Rail¬
road Stock Shares, both
decidedly

common

"Reduction

Se¬

around

valued.

approximately

it: "Diversification adds the
price¬
less ingredient of

INC.

tinue

now

stocks.
when the

Newly published figures of British production in
June, says the
Information Services, highlight the
remarkable upsurge in

"In

vested it in

Late

Jones

groups are fa¬
classes representing

Equipment, Steel, con¬
be substantially under¬

Britain's

Under the above

and is

common

British

Dilemma

notes," published by the Keystone
Company of Boston, comments as
follows:

vested in

"heavy" industries—Electrical
ties with the
Equipment, Industrial Machinery,

Mink."

Trustee's

Thig
is being borrowed at
2%

money

per annum

Group's Choice

industry

Railroad

Hole in the Head."

The

analysis."

"The

Inc.,

Abbett's funds,

the

Gal in Calico—All She

Today that
in highgrade bonds would produce only
2Vz%, or approximately $2,500.
"Worse still, because of the rise

dozen different funds.
While diversification

lowing
vored:

Fujid,

one
of
took down
additional $1,000,000
under the
terms of its Loan
Agreement.

Lord,

are

Only Girl in

variety

investor

popular

Wants Is

However, today the mutual fund
of

network

"I Got

might
yellow leaf.

Affiliated

organization

who

men

Distributors

sings:
"Oh, How We Danced on the
Night We Were Wed—I Needed a

and then again his
selection
fall upon the sere and
a prospectus on

vestment

research

Million

a pro¬

special¬
ists in the various phases of in¬

He also

investor is look¬

staffed

the World and I Were the Only
Boy—But Right Now Just Let Me

1942

second-grade bond

following Burrows'

"If You Were the

barely half as much as one of the
leading mutual funds specializing

Group Securities, inc.

CBS

titles
jive you some idea of his style:
"I Was Wandering Down Mem¬
ory Lane Without a Damned Thing
on My Mind."

might quite
suggested he put

fessional

efficiently by

port" of Group Securities, the fol¬
15-minute

new

the

parodies

own

The

formed most

•

(Saturdays 10:30 p.m.). Abe is a
Hollywood script writer for such
shows as Duffy's Tavern, Dinah
Shore, and Joan Davis but is much
more amusing on his own program
on which he
plays and sings his

bottomless rat hole.

<$>■

Listening

Burrows'

program

Lord, Abbett Borrows Another

ties.

In the current "Investment Re¬

Recommended

capital needs

tensive supervision of the securi¬
These functions can be per¬

National's

1940.

Thursday, August 21,
194^

actual

Britain

she did she must

goods,

75%

export,

than

her prewar figure. Thus her crisis
is due not to any lack of effort

sacrifice, tired though the Brit¬
people are,. but to the enor¬
mously bigger production needed.

ish

Number 2622

Volume 166

THE

COMMERCIAL

FINANCIAL

CHRONICLE

(729)

Waits Labor

Day Dedicated to Repeat of
Taft-Hartley Act
:

William

Green, President of AFL, calls

members

upon

unrelenting campaign to defeat Congressmen

Sees present prosperity based

U. S. Television Stock

Placed

Public

to carry on

cumulative

convertible

preferred

Service

—

This

year

Labor

Day

finds

t h

the slave labor law in the courts:
But even such measures are not
enough. In the coming year, labor

ex¬

under

isting

ominous

the
most

exert

must

shadow of the

oppres¬

sive

stock

advantage of every oppor¬
tunity to challenge the legality of

nation's
workers

Hicks & Co. at $4
per share.
proceeds are to be used for

Net

take

zation:
v

cer

fullest extent to protect the
rights
of our members ill contract
nego¬
tiations with
employers,. We .will-

anti-

its

unite

must

tion

political

before

never

defeat

for

reelec¬

Congress

working

capital.

is convertible

into

The

common

stock

on
a
share-for-share basis
until June 30,
1948, and at slightly
ower rates for four
years there¬

after,

when
sxpires.

history.; We

member

every

strength

eneral corporate
purposes as ad¬

ditional

United

conversion

by Congress. /
{ There c a n
be

national. and

bodies
William

real

hope of future

;

Green

wage-earners

Taft-Hartley

the

mains

the

Act

the statute books.

representative

the will
not

truly

are

of Hhe

succumb

80th

Congress.
Only in this

about

the

bring

can we

repeal

the

ment

provisions will strifle the growth
of< organized labor, weaken the

which is

trade union movement in

surance, an

Taft-Hartley

land

increasingly difficult
Americam working men and
The

American Federation

social

Only

this

justice legislation

acutely needed by the
like health in¬
adequate housing pro¬

gram and a minimum wage meas¬

uring-up-to

to keep their heads above

water.

Act.

American people,

and make it

for

standards

the

sets

member of our organization
join in an unrelenting cam¬
paign for the repeal of the TaftHartley Act.
•
•.

perity is based

temporary

huge

true

Americans, the

mem¬

bers of the American Federation
Labor will rally

challenge, We
to

let

are

to meet this
determined not

freedoms be throttled.

our

legitimate

the

pros¬

number of

upon a

such as" the
demand and con¬

shortages

resulting

from

Now is the time to build

war.

for

surface

prosperity
i n
prosperity shared by

permanent

America,

all of our people,' a prosperity
which will eliminate poverty and
needless human

tions for ourselves and

Government

workers.

our

com¬

right to im¬
our

fellow

We will not willingly or

supinely permit the forces of

re¬

action

our

capture control

country.
Let

make

clear.

this

just begun to fight.
economic

our

The

Rumania
On

We will

strength

use

the

for

congre¬

vision

also

recently

and

sell

began

"direct-view"

regular home

set

use.

including

phonograph

and

short-wave

radio,

The

automatic

FM,

sells

for

and

$895,

tax included.

Annual

dividend

the

are

$15,000

for

the

grasp.

intervention

which

homes,

cent

decent

sets

entire

requirements

issue

preferred

per

Net profit

year.

first four months

$107,937.

1947

Sales of television

have

increased almost every

since

commenced

post-war
in

September,

May, 150 sets

gross

sales

deliveries

were

receipts

sold

were not
subject to
the provisions of the
United Na¬
tions
Charter, and the United
Nations had no control over
their

the UN

was

Chronicle

set-up under Article 4 of
Russia, although hav¬

attended the Bretton
Conference and signed the

ments, has not yet become

Woods

Agree¬
a mem¬

ber of either the World
Bank
the International Fund.
v

The

Norwegian delegate, Finn
Moe, supported the Russian dele¬
gate's contention that the admit¬
tance of the Bank and the
Fund
would violate the UN
Charter and
would lead to a lack of
coordina¬
tion within the Economic
and So¬
cial Council. He
objected to the

independent

status of the Bank
Fund and expressed the
belief that, to admit
them, would

and

the

that

would
mands

the

United

John

Jr.

James,

458 South

Nations

Spring Street, members
be faced with similar de¬ of
the aLos,' Angeles
Stock Ex¬
for recognition
by other change. Mr. James was formerly

with

lard

agencies.

Mr.

Los

Wil-

Throp, the United States

delegate, who defended the

Angeles

Manager

for

This announcement Is not an
'.-

/■'

■.:;/■

./•

••

ner

;v """■ "■•//■ '•/.

New Issue

limited

& Beane.

will

August 15, 1947

de¬

assure

140,000 Shares

decent wage floors
health conditions for

the American people.
In fighting for the repeal of the
Taft-Hartley Act, labor is striving
for the attainment of these goals.

Potomac Electric Power

Company

3.60% Preferred Stock
\r

announced from Bucharest, that the commu¬

nist-controlled Rumanian Government has devalued the unit of

rency, the leu 20,000 times. A contemplated new currency issue is
to-be accompanied by new regulations governing wages, salaries and

prices that is expected to cause the population misery unless addi¬
tional exchanges of old money for new are authorized quickly or
manufacturers are required to ad¬ terms of the old money the basic
vance
wage
payments within a wage rate thus is fixed at from
few days. V'
./
50,500,000 to 280,700,000 a month.
\
On the Rumanian private in¬
Under the wage law that was in
dustrialist,
already
threatened effect until yesterday, wages, in
with bankruptcy, the new regula¬ terms of the old currency ranged

■

Par Value $50 per

cur¬

'•

;■■■;

(Entitled to Cumulative Dividends)

This Stock is being offered by the Company in exchange

stocks,

for its outstanding preferred

set forth in the prospectus.

tions

will

inflict

hardships since he

still

greater

must repay his

debts in the new currency, not
from his current assets but from
future production.
Under the new stabilization de¬
cree, the monthly wages of indus¬
trial workers are to range from

2,525 lei to 14,035 lei

month.

G. V. Grace Opening
George

Grace

from

1,331,000

7,051,000

The

new
order paralyzes Ru
industrially and thus, it is
regarded as a move due to Rus¬

mania

sian

influence,

bring

about

—iWW—

complete revolution from capital¬

W. P. McDermott & Go.

Austin

now

WASH. —Levi
sole

j
F.

Building.

Mr.

Austin

had

been associated with the firm for
some

undersigned {who

art

legally ojjer
applicable securities laws.

Dillon, Read & Co. Inc.

York

William
ence

Partners

Whitaker.

McDermott

under the
mott

City.

McDermott and

name

Co., Inc.

In
in

was

of W.

' *

Alex. Brown & Sons

Auchincloss, Parker & Redpath

are

Clar¬

the

past

business

Folger, Nolan Incorporated

Johnston, Lemon & Co.

P. McDer¬
>

•

Ferris & Company,

Inc.

Goodwyn & Olds

Robert C. Jones & Co.

proprietor of

Edwin Lavigne & Co., Radio Cen¬
tral

New

Mr-.

Now Proprietorship
SPOKANE,

these securities under

ism to communism in the country.

securities business.
Mr. Grace recently has been asso¬
ciated with Mallory, Adee & Co.
*

may be obtained Jrom such oj the
the underwriters named in the prospectus) as may

Copies oj the prospectus

engage in the

plus accrued dividends from July 1, 1947

W. P. McDermott & Co. is en¬
forming
V,1 Grace Co., with offices at gaging in the investment business
Broadway, New York City, to from offices at 19 Rector Street,

Price $51.75 per

month.

years.

Bowles in Rochester
ROCHESTER, N. V.—George O,
Bowles is engaging in a securities
business from

Street.

offices at 31

Gibbs

Mackall & Coe

was

Lynch, Pierce, Fen-

ojjer oj securitiesjor sale orasohcitation ojan ojjerto buy securities,

•

Geyer

Co., Inc. and prior thereto

with Merrill

mo¬

tion, argued that the two financial

•

Aug. 15 it

to The Financial

ANGELES, CALIF.—John

the Charter.

international

against 81 sets in April.

Special

LOS

R. James, Jr. has become associ¬
budgets or veto on their
actions, ated with Marache, Sims & Speer,
they could not be made a part of

1946.

$212,192,

John R. James, Jr.
With Marache, Sims

two

organizations

mean

month

maintaining that because the

of minimum

the. establishment

standards

was

delegate

Union, led the

ing

Drastically Devalues Currency

'«

our

and

American Federation of Labor has

clubs,

Aug. 16, by

with¬

prove working and living condi¬

weapon

to protect our

receptive

suffering.

This kind of prosperity is

requires the
fullest cooperation between free
labor and free management, with

mand

for

factors,

export

sumer

ready to fight with every

are

this

But

every

homes,

reached.

On this Labor Day, I call upon

larger

10-inch "direct-view" console tele¬

console

grills and other places where

produce

health and decency.

Today full employment has be¬
of Labor does not propose to sub-' come a reality in America." The
mit to such oppressive and repres¬ goal of sixty million jobs has been
sive conditions.

are

models and which find
market

gate.
way

prompt

way can we succeed in the enact¬

women

table

aars,

As yet, the full impact of this
reactionary law has not been felt

our

smaller

large numbers of people

by the selfish, big-busi¬
interests now dominating the

by labor, but as time goes on its

ness

re¬
,.

our

law-making

who

will

and

pressure

the
country

our

State'

candidates

people

progress and the enjoyment of
free, American way of life for
While

in electing

and Social Council,

fight in opposition to the
proposal,

adapted to larger audiences than

join

Morosov,

pro¬

jection television sets which

must

J^ations Economic

"big picture"

who voted for this obnoxious law.

votes

included in

has

Council

appr1°Xed a moti°n which had been recommended
the General
Assembly<*>
—
of the United
Nations that the
institutions were in a special cate¬
Bretton Woods Agreements be
ac¬
gory,
were
self-supporting and
cepted and the two international
needed
an
Independent
status.
organizations — the International
"The World Bank and the
Fund,"
Monetary Fund and the Interna¬ he
said, "must conduct themselves
tional Bank for
Reconstruction in such a
way as to get from the
and Development —
be brought
money markets of the world, and
into relationship with the
United not from the
UN, funds for re¬
Nations as specialized
agencies, construction."
Alexander P.
last fall

Television

ever

Social

Norway also objects. *

to the Economic and
Social Coun¬
cil from the Soviet

States

oncentrated

privilege

tabor

law
enacted

set-up.

wffiiK
by

and

two '"^Pendent organizations be

value 5%

par

William Green, President of the American Federation issued the stock, was made Aug. 19
by Willis
following Labor Day message, through the medium of the
Weekly E: Burnside & Co., Inc., and Mer¬
of the organi¬

»?Mt0 **
UN

States Television Man¬

ufacturing Corp., $4

;

News

Despite Russian opposition, Economic

offering of 75,000 shares

of United

who voted for law.

temporary factors.

World Bank and Fund Become
Agencies of UN

Market at $4

Robinson, Rohrbaugh & Lukens

THE

(730)

COMMERCIAL

FINANCIAL

CHRONICLE

Thursday, August 21, 1947

Gromyko Accuses U. S. of Crudest Interference

Canadian Securities
In debate before UN

juncture in the history of the British Common¬
wealth it would appear that undue emphasis is placed on
plans to
rehabilitate the war-ravaged economy of the British Isles.
Without detracting from the importance of maintaining the un¬
interrupted functioning of this essential world-cog it is now urgently
necessary to aim beyond a patching-up program. Although the cur¬
rent U. S.-British financial par-<$>
ieys are of vital direct concern would be complementary to the
to the other members of the Brit¬
ish Commonwealth,
their inde¬

Marshall Plan and its implemen¬
tation would not run counter to

pendent

various

been

views

far

have

not

officially stated. However,

recent
Australian indication of
outlook appears to contain the ele¬
ments of a constructive solution

directed toward
monwealth
to

as a

concentrate

:;he proposed

plans to restore Ger¬
industry.

In formulating such a scheme it
rebuilding of would be necessary for Britain

the

the structure of

foreign
interests
and
aspirations such as in the case of
man

the British Com¬

all

and

the

Dominions

act

whole rather than
alone

concert with this country, and it
Un-: could
logically be considered as

the

derpinning of the economic fabric
of

the

long

Mother

been

natural

Country.

self-evident
of

resources

ah
important extension of the
has Marshall Plan.
Moreover, it would

It
that

the

British

isles

are
inadequate to support
existing population.
On the
other hand, the British
Dominions,

the

with

their

tremendous

unexploited

fully

wealth

resources,

are

constitute
tion

Very

portant

prove

milestone

im¬

the

evolu¬

tion of the British Commonwealth.
There have been spasmodic ef¬

forts in the

direction in the

same

past, but concerted
far

been

action

has

entirely lacking in the
impelling economic

absence

necessity.
Faced now-with

precedented

principle

of self-help

total

be added to thd

negotiating
British-European
be

un¬

would

group

enormously strengthened
exchange for American

financial aid there would be
vastly
ncreased scope for
tual compensation.
any

Canada's

Dominion

adequate

even¬

set

the

could

country.

would

country

this

British

Canadian

still

senior

minion in the British
of.

Do¬

Dominion

discussions

also

community likely that
many
burning tariff
a position issues would also be
happily set¬

nations, Canada is in

,to

take

the

lead

proposing

tled.

Canada

far-reaching plan for the absorp¬

therefore

has

now

tion by the various Dominions of

com-

i ssio

institution

maintain
Greece

and

rebuttal

statement

Herschel

Andrei

1 a s t
weeks "Chronicle," p. 2), of direct
mterference with the internal af¬

Greece

British

Isles.

Such

the

scheme

the

tension

British

Commonwealth

country

Greece,

the

and

relations

During

CANADIAN BONDS

arrive

which has
tion

mission

,\ '

:X,'i

GOVERNMENT

'/i

were

lowing
Cunds

week

and

market

small scale.

Fol¬

flight

declhtt£ in Jr.ee
internals
wereajsp

the

marked

PROVINCIAL

was

down, .but the turnover
negligible. The strong rumor

from London of
in

MUNICIPAL

the

gold

continued
a

tive

stocks.

Its

subsequent
as

caused

ounce

CORPORATION

price

imminent rise

gold to $50
sharp flurry
denial

reaction,
to

result

well

led

continued specula¬

support.

>■*<*»

;;

•)<}-'

-1

SEC
To
A. E. AMES & CO.
INCORPORATED

Preparing Return
Washington in Nov.

PHILADELPHIA, PA. —Trans¬
fer

the

Securities

and

change Commission back

Ex¬

to Wash¬

TWO WALL STREET

ington will begin November

NEW YORK 5, N. Y.

December 1, according to the best
estimates

RECTOR 2-7231

NY-1-1045

the

Public

1 and

Buildings

Administration in Washington
make

this

time

and

can

postponement.
moved

&
64 Wall

COMPANY

for

the

WHitehall 3-1874

The

room

numerous

Agency

was

in the capita
wartime

committee

SECURITIES.
Govtrnment,
Provincial

Municipal

Corporate

the proposal of the Soviet

was

Government—and

delegation. Therefore, we
a simple,
efficient, legally
justified and called-for means to
ensure

tition

the prevention of the
repe¬
of incidents in the
future,

which would be in the interests of

undertake

new

the United Nations

cannot

well

the

whole

gov¬

assis

modest
the

personal

consumption
Personal

anhual rate of

$13.1 billion in the

fourth

quarter

billion

the

1946

first

$12.6

quarter

and

$11.0 billion in the second quarter
of

1947.

Fuller
details
on
the second
quarter estimates will, be found in
the August issue of the
Survey of

Current

Business, officialpublica-

ion of the

Department.

interests

Syndicate Offers
'otomac Electric Pffd.
Dillon, Head & Co. Inc. which
won

the

directly concerned Balkan States."

issue of

preferred

August

140,000 shares of

stock

otomac

($50 par)

Electric

Power

the

of
Co.

bid of $51.75 a
3.60% dividend, head
investment
banking
group

share and

which are offering the shares in
exchange for the 5J/2 and 6% pre¬

ferred stocks of the company, out¬

standing in the

amount of

70,000

shares.
The
wo

exchange

offer,

preferred

new

each

with cash

the

which

old

is
for

preferred

adjustment, will expire

Aug. 26.

Proceeds
the

aken

the

from

sale

the

any

preferred

new

not

exchange

be
to pay off any unexchanged
shares of the
old stock, which
have been called for

will

redemption

equipment

sec¬

by5 the Department of

day

gross

which

basis,

the market value

of the output of

goods and services
by the nation, reached

produced
annual

rate

ing

$226 billion in

The

net

result

senting

the

of these

he second quarter of
over

1947, repre¬ changes in business
inventories,
increase of $3.8 billion producers'
durables, and construc¬

the first quarter of 1947 and

tion

decline in gross private
investment in both quarters.

of $7.4 billion over the last quar¬
ter
of
1946.
While
production

was a

This decline

was

the

stock,

new

cumulative dividend

the

and

share.

retirement

the

preferred issues, is part of a
refinancing plan to simplify the
capital structure of the company.
As part of this plan, the outstand¬

ing 90,000

common

which

owned

shares, all of
by Washington
Ry. & Electric Co., have been' 're¬
classified and converted ihto 85,Domestic in¬

1947

during

$10.3 billion rate in the first

quarter.

old

tory accumulation.
vestment in new construction fell
to an annual rate of
$9.5 billion
in the second
quarter after reach¬

national product,

measures

issue

which is

con¬

but not enough
Com-! to take up the slack in the inven¬

■'

The

increased

Sept. 1 at $107

The

says

dollars, the rate of production in the United
high, exceeding by $4 billion the wartime
peak

merce.

than off¬

are

000 shaies of new

and 2,961,250
mon

preferred stock

shares of

new

com¬

stock.

After completion of the financ¬
ing the company's authorized cap¬

italization will

consist of 400,000
preferred shares and 5,500,000
new
common
shares, of which
225,000 preferred and 2.961,250

new

shares will be outstand¬

common

set by increases of
net
sales to ing.
terly rate of growth has slackened foreigners. In the first
Upon liquidation and dissolution
quarter of
compared with 1946.r * M
1 ' •
1947 these sales abroad
of Washington
were at an
Ry., stockholders
To a considerable extent, higher annual
rate of $9.2 billion and of that
company will receive in
postwar prices account for the rose to
$10.6 in the second quar¬ exchange for their
security hold¬
new high dollar values. The physter which was more than
twice the ings the 85,000 new
preferred and

icalical
mains

volume

below

though

production

the

wartime

far

above

value of the last
quarter of 1946.

re¬

peak

the

Government purchases of goods
and

prewar

services

the

first

half

non-durables

sharing

income

and

the

This

services

rise

expansion

sion

was

due to continued

State

and

local

second

quarter

1947

expan¬

tion.

com¬

pared with $156.8 billion in the
first quarter and $154.9 billion in
the last quarter of 1946.

contrasted

with

common

Electric Power.

Walston, Hoffman to
Admit Wm. Driscoll
SAN

expendi¬

being spent tures as a result of
higher costs
the rate of $159 billion in the and
some
increases in construc¬
was

2,961,250

Potomac

o::

levels, the Department said.
1947 were below the
levels of 1946
In both quarters of 1947, per¬
although a slight rise was regis¬
sonal
consumption expenditures tered in the second
quarter over
j-ose
moderately
with
durable the first quarter of
1947.

the

do have

com¬

quarter of 1945, according to

Personal

departments.

housing

Greek

ond quarter estimates released to-, first half

all

employees in obtaining accommo¬
dations in the capital and declared

CANADIAN

recommendation

In terms of current

States is

goods,

The SEC said it had organized
a.

make

of $222 billion reached in the firsts

Philadelphia in March

1942 to make

ernment

Street, New York 5

should

Department estimates output at $226 billions, but
higher prices account for large part of increased value. Sees
tinuation of increase in corporate
profits.

may

subject to either advancement

TAYLOR, DEALE

Council

levels continued to rise, the quar¬

was

pace with

saving
accordingly reduced from an

was

Commerce

CANADIAN STOCKS
J

Greek

Holds U. S. Production Rate At New
High

but prices
maintained

used

external

although offer¬

ease

the

Union

justified in any case, neither
by the situation on the northern

the

would

failed to keep

expenditures.

in¬

this

securities

which

tasks and functions which

border

present

causes

these

from

comes

Security
strict

decision

real

provocation

future, the

between

relation to the ques¬

removing the

the

side. In order to avoid the repeti¬
tion of incidents in the

of the present situation in Greece?

group

British

the

continued to

ings
"v-

the

cidents

the

for

with relation to

its

and

means

nations is better fitted to
interpret
here the British viewpoint.
section

Yugoslavia,

of the grave internal

nothing to do on the terri¬
of Albania, Bulgaria
and

tory

time"

causes

connectingcountry and the

the

"These border observers would
have

said Gromyko.
"Should one be astonished, there¬
fore, that instead of removing the

real

inde¬

would only create new and addi¬
tional complications in the rela¬
tions between these states.

comes

States

United

the

from

affairs

income
The increase

the institution of border observers

fairs of Greece.

present

the

of its Members. One cannot doubt
for a moment that the creation of

Gromyko

e e

internal

guarding

pendence and the sovereign rights

ac¬

cused the U. S.

( S

observers

disposal of

purpose

Johnson, U.S.

Delegate,

the

proposal, for such a
proposal is incompatible with the
sovereignty of the states and with
the principles of the United Na¬
tions, which were set up for the

States, and as
the

.with such

Balkan

the

border

the

„__i

growth

personal

disposable'income

the commission? One cannot
agree

between

peace

who would

to.,

proposal for setting

disposable

continued to go up.

Nations."

with

her reputation as the
link between this

redundant population -of

the United

the

unique opportunity to live

the

nor

oorder

history, further
stimulated, but arising out Such attempts were aimed,
nothing short of heroic measures of the
necessarily detailed U. S.- known, at the creation of a
will suffice.
As
the

Greece,

permanent

neighbors,
the
industries in representative
of
the
United
not be suc- States has endeavored through all

new

this

Charter of

income

that
of

borders

Continuing his attack, Mr.
Gromyko said: "Can one agree

Greece

and

trade

with

Personal tax and non-tax
pay¬
slightly in each quar¬
ter, but the rise was less than
the
increase in personal
ments rose

<$>-

the

States

United

situation

essfully undertaken without the
assistance

wealth

natural

establishment of
the

a reso-

lution

Furthermore,
development of

program

posing

re¬

tary.

a debate on the Balkan situation on
Aug. 14, Andrei Gromyko,
delegate to the Security Council of the United Nations, in op-r

"The crudest interference in the

the

power

result, not only

situation

resources

In
Soviet

European pool.

The

underpopulated.
Thus the
thus
immigration
scheme
and
put forward by Australia can
well

the

;he British Commonwealth

ambitious
now

tremendous contribu¬

the immense

woe¬

Security Council,

Border Commission is

At this critical

mained stable in the
second quarData on corporate
profits in
period are as yet
fragmen¬

says setting up a Balkan
incompatible with sovereignty of states and
principles of United Nations.

By WILLIA1JI J. McKAY

compared with the last
quarts
1H/K3
n
1946.
Proprietors' and
rental
income as well as net

interest

In Greece

FRANCISCO,

William
the

New

CALIF.

Driscoll,

York

will be admitted to

—

of
Exchange,

member

Stock

partnership, in

The flow of income
has been Walston, Hoffman & Goodwip, 265
maintained at high levels thus far Montgomery Street, members of
in

1947.

Wages and salaries

the New York and San

Frapcisco

Stock
rapid creased
Exchanges.
Mr.: ;Driscoll,
moderately in each quar
who has
inventory accumulation in 1946, a ter with
recently been doing:bus¬
private payrolls more
noticeable slackening took place than
iness as an individual floor
broker
compensating reduction in
in the first quarter of 1947.
and prior thereto was a
This government
partner
employment.
In

was

further

second

the

accentuated

quarter.

the

Measured in

cur¬

creases

average

hourly

Edward

earn

Field

Co.,'will

ings contributed to the increase in make his headquarters in; New
York City.
prices, the net increase in the payrolls, of which a
large part
second quarter amounted to $1.5 was
concentrated in durable
goods
billion as compared with the
Mother government agencies1 those
$2.7 manufacturing.
Michael Cosgrove Opens
in the first quarter;and with the
With the rise in volume
employees who are not willing or
and
peak rate of about $5.4 billion in
JAMAICA, N. Y.—Micliael Cosvalue of
able to transfer with the
business, first.--quarter grove is
commis¬ the last quarter of 1946.
engaging in an investment
profits of both
that every effort will be made
by
the personnel office to •place in

rent

....

sion.

•

Purchases of producers'durable
incorporated

corporate! and

business from offices at 8230 187th

enterprises increased Street.

,*■~

Number 2622

Volume 166

THE

COMMERCIAL

FINANCIAL

CHRONICLE

INTERNATIONAL
•

SUMMARY

Camille Gutt, Managmg Director issues first quarterly report show¬
ing assets of over $6% billions as of May 31. Gold held reported

slightly

than $1 1/3 billions, the remainder held

March
-

FUND

railroad

These

TRANSACTIONS

ments

1, 1947, to May 31, 1947
Amount in

U.S. Dollar

Currency

May 31, in values expressed in
U. S. dollars on the basis of the

Sterling

Equivalent. tended

French

transportation."
that

cannot

The

Interstate

in view of devalua¬
made in a number of
members' currencies. The detailed
cases,

some

INTERNATIONAL

March 1.

No currency was bought

2,977,675,000.00
31,953,601.94

Guilders

Currency Sold Against Gold

(Nil)
Currency Bought Against Gold (Nil)

BALANCE SHEET,

U.S. Dollars

creases

LIABILITIES—

Excess

Less

have

Inception to May 31, 1947

Net

Capital-

Miscellaneous

$7,721,500,000.00

1,415,120.26

-------

$7,720,084,879.74 have

-----

Over Income From

Expenditures

89,595.31

been

found that the railroads are

in reasonably good
tion
for
current

--------

$7,720,174,475.05

financial posi¬

of the rail¬

if not all,

many,

roads the increase in wages some

t NOTE—For details see Holdings of Currencies.

months ago sent

HOLDINGS

(Including

As at

Non-interest

May 31, 1947

(In Millions of Units)
Net Change

Amount

U. S. Dollar

225.00

—

1,274.49

41.11

(pesos)

65.62

(pesos)

Costa

Rica

Cuba

(pesos)

(colones)

•I

4.67
r

Czechoslovakia

(koruny)

—

(kroner)___Republic
Ecuador (sucres)
Egypt (pounds)

>!«

—

Salvador

50.62

3.75

9.55

39.47

4.69

1.87

14.87

5.99

56,030.43

470.42

(colones)-

Ethiopia (E. dollars)
France (francs)

—

Honduras

4.87

0.75

1,232.34

372.47

Iceland
Iran

(kronur)
(rupees)
(rials)

Iraq (dinars)
Italy

604.56

18.75'
8.00

1.98

—

Lebanon

423.99

Norway (kroner)

218.29

7.50

1.50

(pesos)

—1-

+12.05

3L95

74.99

268.84

1,083.44

1.50

actual financial position

for

each

with

its

including

dertake at

once

expansion

the great program

and

improvement

which they need.

property values, income, expendi¬
tures

and

This

means

resulting

making is

that

railroad

rate

difficult because

reasonable rate for the

carrier

average

earnings.

may

produce

excessive net income for the

an
ex¬

We had the

problem after
World War I. For many years the
Interstate

same

Commerce

Commission

the

courageously
dered the

time

and

had

been

definitely

make

railroad

reasonable for the carriers

railroad
on

managers

from day

day bearing heavy burdens of

state and Federal taxation, heavier
burdens for wages and pensions
constant

disputes with labor

leaders seeking higher wages and
with rate making bodies reluctant,
for political reasons, to

permit in-

,creased rates. Unquestionably, the
railroads
need
financial elbowroom.

soon,

deed

when

or¬

problem

the

with
way

public welfare, or
very

2,030.28

31.58

exceptions

of Bolivia and

6.05

—31.58

threatened

members be

par

values

Honduras, certain legal points are out
.

country

rates

may

inability to meet future

emergencies.

well

That, if it happens,

the

new

time

MANUFACTURING CORPORATION

for the

come

5% Cumulative Convertible Preferred

which

are

not

avail¬

in use?
to get

yet

all

the

Price $4.00 per

needed^ funds from cur¬

rent income.

As in the

case

Stock

(Par value $4.00)

equipment and the in¬

of the

Company , and
the
Telephone
power
companies, the railroads
would get much
of the capital
needed for a great program of

1.50

(Bolivia and Honduras)

in¬

existence, of this

5.02

this

and
again see the day

practical

may

the

deal

not
a

railroad

Commission from that
to

the

compelled to go

are

that

and

ceptional road.

It would not be necessary
—

fixed

accordance

capital are well under¬ gress in that same Act provided mer E. White has become affili¬
way.
American Telephone and that where
any railroad
earned ated with Holton, Hull & Co.,
Telegraph,
for
example,
will
210 West Seventh Street, members
more than 6% on the value of its
spend during the current two
of the Los
Angeles Stock Ex¬
years in excess of $2 billions for property the ,e3fcps{> shp.uld
fteW
improvement * of
its plant and in a special fund to be used for change.
services. Electric light and power
companies estimate that during
the next three years they will
NEW ISSUE
need for a like purpose upwards
of $41/» billions. These large sums
75,000 Shares
will be expended not for main¬
tenance and repairs but for real
expansion and improvement.

able
18.61

them

ing plans involving reconstruction
in the interest of efficiency and

.yej; been agreed, either because of postponement at a member'
or because admission to membership has been too recent

standing..-

therefore

can

The

necessary

22.50

request,

cases

and

shippers. That Act declared will be due to our failure to pro¬
the Commission's railroad
the future the services which our that
vide the railroads of today with
engineers can provide,,}they and rates shotild be stich as to permit
the
financial
means
of
fitting
other technical men must be sup¬ the carriers to "earn an aggregate
themselves for their problems of
plied
with
the
capital
which annual net railway operating in¬
makes possible the development come equal, as nearly as may be, tomorrow.
which our future public welfare to a fair return upon the aggre¬
demands.
This necessity for re¬ gate value of the railway prop¬
With Holton, Hull & Co.
building has been recognized in erty."
Special to The Financial Chuonicl*
many industries, and plans for its
To
avoid
the
windfall
that
LOS ANGELES, CALIF. — El¬
realization and for obtaining the would result to a few roads, Con¬

Hasn't

♦Subscriptions have not been received from these
two

lowest

railroads to make similar sweep¬

5,185.09

with

did

1.50

Total

In the

11.25

Africa

•

not

problem of recon¬
industrial and trans¬

ventions science has made

have

our

are

21.85

cause

4.63

—

(£)United1 States (dollars)
Uriiguay
Venezuela (bolivares)
Yugoslavia '
n

advancement,

142.01

•

i >' t'

safety and

must be maintained.

safety,
South

the

UNITED STATES TELEVISION

J—
Turkey ;
of

world, and their serv¬

available

The people of this country
their business demand ade¬

quate transportation, and they are
prepared to pay for such trans¬
Telephone Company
and the power companies are in portation an adequate rate. Con¬
Detter position than the railroads gress should again declare a pub¬
lic policy with respect to railroads
however, because to a very great
that
will make it possible
for
extent they are monopolies in the
them to obtain the capital to un¬
area in which they
serve.
Rates
bodies.

(pounds)
United !Kingdom

are

Needed Plans of Reconstruction

0.04

Syria

Uriion

proval of their rates from public
and
rate
regulating
making

37.50

186.10
-

Paraguay * (guaranies)Peru, (soles)
Philippines

67.50

579.10

——

Panama (balboas)

9.68

327.71

Luxembourg (francs)Mexico (pesos)
Netherlands
(guilders)
Nicaragua (cordobas)-

Poland

3.75

(quetzales)

ap¬

within

■

+25.00

+2,977.68

Greece

Guatemala

India

62.47

299.82

Denmark

Dominican

123.55'

6,177.58

secure

ices

prosperity

nation

rates.

bring down railroad rates to what
was regarded as reasonable in the
interest of shippers.
Congress in
the Transportation Act of 1920

during'the War in other
countries, but if we are to have in

37.50
•. if

37.50

must

ests

curred

37.50

26.23

—

of gross
in

increase

not suffer the destruction that oc¬

China
Colombia

55%

recent

structing our
portation plants. It is true

225.00

(dollars)

They

without

Brazil

The

We in the United States

Canada

Equivalent

168.75

Bolivia

Chile

Currency

Equivalent

7,395.86

(francs)

permit.

competition

percentage at least, in the inter¬

—Since March 1,1947

Country & Currency—

and

the

goods move about
We have the b.est rail¬

quickly.

freight rates has brought the per¬ had been setting aside unreason¬
centage back again toward the able railroad rates and
fixing
long term -normal of 45%. This reasonable rates.
The approach

Belgium

wages

income.

Bearing Notes)

U. S. Dollar

the percentage of

total

OF CURRENCIES

Non-negotiable

ade¬

and

men

roads in the

consumers

if what is

operation

exceed 45% of gross.

wages do not

Total Liabilities

and
balancing in¬
wage,s,

in railroad rates for both

creases

Members' Authorized Subscriptions

make rates

After all, the railroads are not
asking for public funds out of our
freight and passengers. Investors the case of the railroads there is already over-burdened Treasury.
If permitted, they are prepared to
have for a long time watched the competition among
several car¬
finance themselves from private
relation between gross income of riers in the same general area and
investment sources.
They cannot
railroads and total labor cost and like rates must be fixed for all.
there

Capital:

railroad

the

assured

which

(Continued from first page)

other industries in the legal re¬
Gold—38,096,326.875 Fine Oz. (U. S. $35.00 per oz.)_ $1,333,371,440.63 quirements
imposed upon them
Balances with Depositories f812,847,556.03 ::or retirement and pensions for
Members' Non-Negotiable Non-Interest Bearing Se¬
their employees.
curities Payable at Face Value on Demand t
4,372,245,998.06
Our railroads did a magnificent
Unpaid Balance of Subscriptions of Members Whose
job
of
transportation
during
Par Values Have Been Established
22,714,252.18
World War II. That performance
Unpaid Balance of Subscriptions of Members Whose
involved wear and tear
which
Par Values Have Not Been Established
1,178,882,100.00
leaves them in severe problem of
Miscellaneous
113,128.15
improving
right
of
way
and
equipment. There have been since
Total Assets
$7,720,174,475.05 the close, of the War some in¬
--

not

Congress Should Act

Elbow Room ior the Railroads

MAY 31, 1947

Com¬

FUND

did

here.

explained
Commerce

It has been said that

(Values expressed in U. S. Dollars on basis of established parities)
ASSETS—

quate, and the recapture of excess
earnings was abandoned.

The complete statement follows:
MONETARY

This program failed for reasons

mission

37,045,000.00
Gold Transactions:

sold against gold..

Francs

Netherlands

are

tions to be

to be the foundation upon

private management could
enlarge railroad "facilities in order
to
provide the people of
the
United
States
with
adequate

25,000,000.00
12,045,000.00

1,500,000-0-0

Currency Bought:

not regarded as permanent the holdings of U. S. dollars were
likely to be altered in reduced over $31 millions since

ties are

and

These pari-

strengthen
railroad management in the
hantjs
of private owners. They were hit-

31,000,000.00
6,045,000.00

31,000,000.00

and $12 millions to Holland while

parities.

enact¬

which

Dollars

Pounds

rencies indicates that $25 millions
were
made available to France

established

statesmenlike

intended

37,045,000.00

On Aug. 13, Camille Gutt, Managing Director of the International
Monetary Fund, and C. M. Powell, its Comptroller, jointly released a
statement - showing the
balance s>—
—
sheet of the organization as of holdings of member nations' cur¬

improvements generally.

were

Currency Sold:

France and Netherlands granted advances.

bers' currencies.

MONETARY

Exchange Transactions—

mem¬

(731)

— -

Offering made only by prospectus,
your

expansion and improvement from
investors, if railroad income now
jus¬
tifies

such

power

investment.

Company

companies,

Like
*

the

the
railroads

30 Pine Street, New York

■

are

not

free as - are other indus¬

tries to fix rates or

prices

high

INC.
5, N. Y. j'j

WILLIS E. BURNSIDE & CO,

the

and

obtainable from
undersigned.

UNDERWRITERS

and for the future reasonably

Telephone,

investment dealer or the

Telephone: WHitehall 3-0852

I. |

MERCER HICKS & CO.
150 Broadway, New

York 7, N. Y.

Telephone: COrtlandt

7-9160

(732)

•

THE

COMMERCIAL

FINANCIAL

CHRONICLE

Securities Salesman's Corner

(Continued from first page)
,
to constructive plan¬
ning.

By JOHN DIJTTON

SEC

and

the Securities Acts

But broad
inherent in

are

indifferent, with the

power

Congress,

Executive and

to men,

good, bad

That is why

Moscow.
The

practice

they will eventually break
they will break the economic life of the

ruling and another while they blandly
threats such as "full disclosure
rules, etc.," may have

toss out

one

to look for other jobs
time
age

they

are

making

broker, dealer

them for

can't blame

you

up.
some

hundred shares of stock

of the

week—you

part I'll be

(2)

German

rapid

poten¬
of

war

handing

over

equipment

and

quick recovery of the vic¬
tims of Nazi looting.

secure

(3)
in

Payments

kind,

capital goods
money derived

not

from sales of current
-production,
to avoid the intensification of eco¬
nomic

competition, which had

re¬

sulted from the former
reparation

con¬

the assump¬

that Germany's overwhelm¬
war potential
had been the

mama

structure

due

was

German government. In

absence, the Allies had

ting

For

Germany. As four powers,
divergent aims could
a
condominium, zonal

partition

inevitable. The Brit¬
ish, foreseeing its dangers, had
managed to insert a clause in the
was

This

will

available

any

currency.
India to make

purchases

food,
imports in
the United States.
In
addition,
another £30,000,000,000 is made

temporary shortages arising from
making payments abroad.
This
like the other £35,000,000

sum,

■

John C. Roberts Joins

Waller & Go, Staff
Special

other

available to the Indian Domin¬
ions as a working balance to meet

could

i-1—

£35,000,000 would

and

The Financial

DENVER, COLO.—John
erts

has

become

with

Walter & Co., First National
Bank
Building. Mr. Roberts was for¬
merly Denver representative for
the Broad Street
Sales Corp.

exchanged into dollars,

M. A.

sterling
such

used

outside

payments

other

transfers

India for

abroad
as

may

and

agreed between Great Britain and
two Dominions
recently set

the

up in

India.

Special

The

Financial

with

its

and

zone.

tamper
political

At the very

moment,

moreover,
when
the
preservation of German economic

Eastern and a Western
repa¬
ration zone. The two zones
were
an

not separated by customs
barriers,
the occupying powers
merely helc

the regular flow of goods and

men

the

across

boundary

line.

They planned a kind of bulk trad¬
ing: The Western zone was to send
its

removable

industria

needed

not

peace

Soviets, who

for

were

Ger¬

economy,

to repay

the

%ths

it in goods.

of the Detroit Stock

Mr. Dorst

free

economic

structure of

many's

Dorst has become associated with
M. A.
Manley & Co., Buhl Build¬

Exchange.

left

was

the

was

Stoetzer, Faulkner

formerly
&

Co.

Poland

was

11
provisionally

nearly y5th of Germany's

territory
losses

pre-war

compensation for her
Russia.
She was per¬

mitted to expel within
two years
the remnant German

Over-the-Counter Quotation Services
For 34 Years

doctrine,

and

ably

in
zone

West

Lack

tlement

NATIONAL QUOTATION
BUREAU, Inc.
Established 1913

Street, New York 4, N.

San Francisco

Germany
of

and

million

the

Poles

set¬

their place, cannot be
undone by
legal reservations.
The Russian zone and
the re
gions provisionally ceded to Po
land

had

been

Germany's

gran

they contained nearly all the
large,* intensely farmed
estates

ary;

which

yielded

surplus

the

imports
and

from

the

from New Po-

scarcity,

lave

aggravated the situation
{n
Western zones; but
they are
not the fundamental causes
of its
plight. The chaos prevailing in
hem is due:
the

new, frequently un¬
farms, resulted inevit¬

a, severe fall in output.
has not been able to send

(1) To the dumping of
million
evacuees
and

from their lost lands

refugees
(about % of

Germany)

the

and

from

Russian

May zone.
•
"
',
1947, have been about 120,000 tons
(2) To war destruction. Thought
of grain
(Germany's yearly pre¬ airraids -have
by no means de¬
war
consumption

was

stroyed the. so-called

million

tons); about 120,000 tons
potatoes (pre-war consumption

tial,

missed the plants—for ex¬
ample those of the dyestuff con¬
cern—but* have made a shamble
of the neighboring cities.
(3) .To the hold-up of produc¬

monthly grain import needs
Anglo-Saxon zones are
300,000 to 400,000 tons,
nearly three times the total conof the two

Detween

The

zone.

(4)

distrust propertysuccessful peasant pro¬

prietors;

they would not
collapse of these

the

over

tion by getting
ready for removal
of 740 of the
large plants.

Soviets

minded

It would furnish

owners.

due

prisoners of

alone, and perhaps 2 tb 3
millions by Russia.
(5) To interference with pro¬
duction by
de-Nazification—espe¬
cially in the United States zone—

which,

absence

necessary

in
equip¬

ment, especially for lack of trac¬
tors (Russia has removed
60,000

until

tractors)

would, lamentably fail
the present time. The Bolshe¬
viks have not minded
the loss of
of

human

lives,

(6) To.
plotted by

when

they, collectivised their own agri¬
culture; they cannot be expected
to

squeamish

who

mans

fear.

they

both

conflicting

hate

Clay

his

tives

are

planned

ulation

and

tral

...

The

economy,

destructive; the limita¬

output and manip¬

German

ture

inde-,
agencies

pendent

Poland and from their

decentralized
produce a mix-up in com¬
parison to which even the can-ma¬
must

zone.

They have realized the appaling
waste involved in these
operations
and have left about
two

exports

the
to

tries, whose

zone

can

spare,

(

for

hard

time, they have

resumed

re¬

only

lately they have
asked for the
delivery of two mil¬
lion tons of
scrap, the. collection
of

Berlin's

alone

involves

cur¬

rent-production. A recent German
estimate
claims, that 6.. billion
marks

out of zone's total
ipcome
8,000,000,000 marks has gone to
Russia. At their
instigation the

local

communist

ments

colored

govern¬

Anhalt-Saxony

and

enterprises.

Thuringia it

of all

The

is to all purposes be¬

zone

a
semi-communist
intimately interwoven with

sia's planned
economy.

state
Rus¬

The struc¬

tural economic

external German assets.

Zonal reunion would not make
available to the Western zones the

resources

Eastern

of New Poland

and the

It would not assimi¬
late the latter's social structure to
Western patterns, for it is
zone.

by now

closely adjusted to Russian
economic and political needs, that
it will contribute little to
the West

during the critical

years.

Reunion

could not remove the
major causes
of the
paralysis of the Western
~ '

•zones.
1

For

.,v

■

-i

the

last two years,1 IRussia
usually supported by France; i has
opposed
German
reunion. \ She
needed

tijne for the sovietization

of her zone.

She has

now

turned

round

completely, clamors for

union

and

was

done" without,
compensation.

capitalism"

(8) Destruction of foreign credit
by an indiscriminate confiscation

currency are not made available
to the Western-zones.
From time

movals;

"anarcist

(7) Currency anarchy caused in
part by the war, and in
part by
the Allied printing press.

hundred

currency coun¬
payments in goods or

drawn by. Socialists looks
like di¬

vine order.

plants, originally scheduled for
removal, -to work for Russia's
account. They are
using such sur¬
plus

Cen¬

export.

planning entrusted

Russians
have
removed
everything worth while removing
both the-regions
ceded to

from

own

planning staffs with
views, whose objec¬

tion oi German

Ger¬

over

General

responsibility stopped the trial of
800,000 unimportant Nazis.

millions

by the Western

war

powers

ap¬

propriate argument for introduc¬
ing collective farming
the

the lack of man-power

its

waste in dismantling
scheduling operations, and to
withholding of one million

the

small

and

worry

poten¬

have

The

ribution of the Russian

war.

they

have greatly damaged
industries; in many,,cases, they

between 35

coming

of
zone

and, together with world

propaganda,

disregard to technical

fraction of it3 former
contribution. Its actual deliveries
out of the 1946 harvest
up to

dumping

Germans

that

port needs.
Eastern

even a

Eastern

of this
arrangement. The
of 8 * to
9 million

fraction

£ 200 million
spent on

agreement,

financial means available for

The

Great

production must be used
in the first
place for German im¬

equipping the

West Prussia and of the
two Si
lesias. There is
jio sense in harp
ing on the provisional character

Western

obedience

and

current

Brandenburg, three-quar¬ Thuringia have nationalized alto¬
Pommerania, the whole of gether 185 mining and processing

ters of

Chicago

reforms, rushed through

States'

duction responsible for
these poor
results. They appeal to
the clause
in the Potsdam

have
gained the good will of the local
proletariat and they have laid the
foundation of a communist
hese

pur¬

the Eastern zones' current
pro¬

eradi¬

cally drawn reparations frorp

given

population
from half of East
Prussia, nearly
half of

46 Front

acre

the labor of about 7,000 men and
140 lorries.
They have systemati¬

Chronicle

DETROIT, MICH.—Clarence
ing, members

power

with

equipment,

Manley & Go.

which
identical lines

occupying power.
But
meaning of economic unity
left vague. " Each
occupying

25%

Clarence Dorst With

piocked sterling owned by India

branches,

run

each

was

C.Rob¬

associated

to be

unity was agreed upon, the coun¬
try was split by the establishment

Chronicle

but must be replaced
by sterling
before the end of the year. The

can

administrative

the

£1,160,000,000, witiv^

permit

needed

machinery

agreement, which af¬
firmed the economic
unity, of Ger¬
many. It enumerated the several
were

On Aug. 14, the British
Government and India signed an interim
agreement, to run to Dec. 31, 1947, under which India's
sterling assets
were fixed at

much

Czechoslovakia; they have
the
Junker;
they

ad¬

with utterly
not exercise

purchases by India in U. S.

for expenditure in

has

independent

keeping the Germans alive.
Their
governments hold Russia's
drain

cated

minister the
country. This led of
necessity to his proposal for cut¬

at the end

"Thank God for the SEC."

actual

tion of

its

extra quarter so that
you

couple of bucks to
can

tion

surrender,
which
had made impossible the
formar

heretic!

made

and

less

from it

United

of the over

ex¬

been able to settle farmers out of
he
3y4 million deportees from

unconditional

Sterling assets at £1,160,000,000, of Which
£35,000,000 becomes available to India at once. Portends
larger

immediately

farmers,

The Russians have thus

economic

■

tools

war

another

prevent

Potsdam

qf them

Britain's receipts from the
con¬
fiscation of German
shipping and
German assets in
neutral couptries cover but a
small

equipment, have been

and

President Roosevelt's insistance

Anglo-India Interim Financial Agreement Signed
Establishes Indian

provision that

utter

Its

apologist

fog of depression; if you don't mind kicking the
plaster off the wall at night because you marked
up
a

perience

reparation

decisiye factor in Nazi aggression.

stant

small

of them without much

exigencies

ing

Sure if you enjoy doing business in

could take home

numerous

many

the

The plan rested

security salesman and

wanting to keep it

SEC."

arge
and

The

the

and 40 million
tons)
No doubt at the present settlements, and had contributed
30,000
tons
of
sugar
(pre-war
largely to the Great Depression.
much softer livelihood than the aver¬
consumption
1.5
million
tons).

Think twice the next time
you hear

the

someday.

for the securities business tell
you "Thank God we've

got

In the Russian
zone,
estates have been cut

each

But, unlike Russia,
they
have not profited much

will take years
before the former
-output can be
reached.

policy.

with

aggression.

Those SEC Lawyers who today sneak back and

country.

forth between

was

pledged;
sued

zones.

society has to

new

and

moval of the German

discarded anyway because

down in

nor

contribute

Western

political rather than
financial. Its objectives were:
(1) First and foremost the re¬

tial,

Poland

can

society.

basis

scheme

imported by Roosevelt will all have

were

had prevailed
Russia had

sum

Whilst

protested then, she had re¬
sumed these superseded claims at

Someday these reactionary, alien ideas of bureaucratic
statism that

commission

not

have

fixed

Potsdam.

system of courts.

reparation

failed, the British arguments

against

TO MAKE LAW, JUDGE

LAW, AND ENFORCE IT.

the

loldings.

specially

New

zone

established

Great Britain

objected, and after

had

...

over

was

appointed

by chance
Henry Wallace headed up the SEC. It could happen
you know
he almost made the presidency. That is
the .real danger in these things. Our
government was
intended to be handed

policy, hitherto
connected with, but

basis for discussion.
had

never

built,

the

by Russia's reparation
At Yalta, Russia had
claimed $10 billion, a figure which
the United States had accepted as

would have if

demands.

are

fine kettle of fish

much

not caused

subject to abuses that are poten¬
tially inimical to freedom and our traditional American
system of free enterprise. Just imagine for example,
what

Paris

pursued,

emphatically enforced.

bureaucratic grants of POWER such

Neither

Russian

New Poland

(Continued from page 3)

laws should be

The final breakdown at Moscow

UNDERMINING

THE SECURITIES BUSINESS

the

towns.

destructive
.

THE

Thursday, August 21, 1947

Chaos of Allied German Controls and
Reparations

poses

re~

champion; of

German unity. For she wants.-a
;vote in the administration of:the
Ruhr and reparations
from;its out¬

put.
A few days ago, she ^de¬
manded the removel of six
major
steel plants. She fears the Ruhr's

unity on which the
insist,' has been .integration into a Western Eu¬
ropean economic bloc, as a
split for the time being at least
poten¬
tial arsenal of Western democracybeyond repair.
Western

Allies

She

III.
Like Soviet

Allies have
nomic

Russia, the Western

unity to which they

nst

interested

eco¬
were

the

Germany.

naturally favors unification
as

disregarded the

covery of Western

would

propaganda

facilitate
in

the

re¬

Stye
nowv

communist

West," create
internal difficulties for the WesJ-*

Number 2622

Volume 166

THE

Powers, and enable Russia to

ern

chaos

all decisions in the West.
if she were to grant admin¬
istrative reciprocity in the Eastern
'zone in return for a vote in the
West, the Western powers would
be dished. She could always over¬
come their veto in Eastern affairs

which

resulted

COMMERCIAL

from

the

block

First

Even

math—inflation. The chaos
pre¬
vailing today in Germany is far

been organizing. A re¬
united Germany would be a house
divided against itself, as long as
the people of the Western zones
remain anti-communist, and those
has

she

become

East

the

communist.

has been the aim of
French policy since the days of
Richelieu. It has not paid in the

Division

—communist
will

sweep

barrier,
the

not

communist—

the

away

ideological

it has swept

away

past equally

and

strong religious
dynastic barriers,
IV.

It is quite understandable, that
proud
of her military

past, prefers to explain her three
^defeats
by
Germany's superior
natural

and

resources

mechanical

who

for

which

can

provide
Nazi

realistic policy.

yet

turned

ceilings

it. At a time, when the
steel
output is about 2% million
tons,

quarrels
12

over

million

ceiling of 5.8

tons

need

the

Allies

tatorially,

limit

tels;

their controls

far

are

car¬

drastic and efficient than the

strictions and regulations

re¬

which

States

who

the

realized

United

the

over-

whelming

production, - could be "won
temporarily to this view. It

fitted in

beautifully with the doc¬

dear

Liberalism

monopolist

those, who

and

blend

Leninism,

capitalism

that

its

last

the

that

and

iwars*

main

cause

its

all

destruction

would mean the end of all wars.
In reality,
Germany's war potential was

extremely vulnerable,

Hitler

knew

well

very

when

he clamoured for additional living
space. He got it by his treaty with
Russia and the triumphal march
of the
of

German

armies

over

most

Europe. The highly developed

German processing
which had turned to

war

potential

Nationaliza¬

urgerit problem
on output are un¬
Nationalization of going

by businesslike bour¬
geois, governments has frequently
excellent results; under a
Socialist government it might end
in

the nationalization

the

expense

efficient

of losses at

of the taxpayer.

nationalization

oughly disrupted

German

tries is

indus¬

moreover

pacity

thor¬

beyond the ca¬
fake-democracies

the

which the Allies

Germany;

are

setting

governments

without

practical experience, in business
or politics and without
credit, are
not

equal to it.

In any case, it is
illogical first to weaken

rather

these governments by

insisting

Federalization, and then to
strengthen them by
economic powers
who

vesting

in them.

vast

Those

advocate nationalization be¬

always depended for its success¬
ful workings on
foreign imports;
apart from coal, potash and ni¬
trate,

The

Germany

had few of the
essential key materials for mak¬

cause

need

last

stopped German re¬
without the slightest

armament
risk
at
any

time before
1936.
Driveling pacifism was as much
responsible for the outbreak of
the war

ranting Nazism.
large part of the Ger¬
potential has been lop¬
by the Polish-Russian

stitutions.

man

war

ped

off

cessions.

An overpopulated West¬
ern
Germany can not feed herr
self. Her cities are in shambles;
both capacity and

which

constitution

future

has

been

free

will

Germany,

underwritten

Allied

bayonets, at a time when
political parties had to go in for
"protective coloration."
In

Today,

order

raise

output

and

make the Germans work for their
own

salvation and for the benefit

of the

Allies,

forms

essential.

are

must

few immediate

The

stabilized.

re¬

Mark

Without

stable mark German peasants will
not deliver adequate quotas for
the feeding of
the towns.
But

efficiency of
her surviving plants
is greatly
diminished.
Without large scale stabilization—plans that have been
foreign
loans,
Germany
could prepared by United States experts
never
restore the war potential —will have to avoid the complete
of
debtor's
remaining
within
her
wealth
borders, destruction
even

if the

were

is;

armies

withdrawn

dependent

ports. that

mere

occupation

tomorrow.. She

foreign im¬
exchange control
on

would suffice to prevent re-arma¬
ment.
The
acceptance
of
the

American four power pact (leav¬
ing the UN out of account)
seems to provide all essentials for
security. In these circumstances,
it is about time to
scrap the eco¬
of fear, stop destructive

nomics

which

caused

was

stabilization.

resulting

by the 1924
pauperization

The

from

contributed

greatly to the spread

of Nazism.

A central budget will have to be

framed and with the help of for¬

eign loans, balanced materially
not merely formally by ignoring
past and future obligations. It will
have

tion

include

for the

man

ships,

some

compensa¬

confiscation

scheduled

Der-Nazification has not done it.
One; cannot
spiritually ' delouse
masses
of active Nazis by
im¬

property of-Nazi criminals-;
shares

prisoning..- fining

scattered

them.'!

will

4 democrats

sturdy

demoting

not become
when
they

prises

were

and

holders
ence.

Ger¬

foreign
assets
and
plants.
These enter¬

planning and face realities.

They

not
bonds

the

were

their

widely

amongst thousands of
without
political influ¬

The hundred

thousands'.of 'Incurables" amongst
them* should have been put into

must be made a burden of the
State and distributed by it on the

labor

community.

batallions

and

deported.
They, not the hapless prisoners of
war, should have ended in
Si¬
berian concentration camps. It is
.

much

the

Nazis, than
old

important to prevent

spawning

one.

numerous

punish

every

new

single

Nazism originated in the

and repara¬
be combined in an inter¬

can

allied holding
company, in which
the shares of all German enter¬

prises

which

watch,

the

Allies

pooled.

are

•

;

The Western group, and particu¬

larly its smaller members, have
far received next to

nothing from

man

Western

pro¬

will

issues,

and

on doctrinal
which both

Germans

have

Germany

once

divided,

are

deferred

until

going

concern.

The

Allies

will

have

cease

of Russia

not

going to be converted

she calls "Fascism."
tion

to what

It is most

fortunate, that the line

un¬

of separa¬

through the heart of
instead of coinciding

runs

Germany,

with the ethnographic frontier of
Russia.
It
has been
drawn
at
Teheran and Yalta by planners

who
not

looked

backward

forward

with

hope.

fear,

has

been sanctioned at Potsdam and
hardened in the last two years by
the
intelligent use, which the

Soviets have made of the oppor¬
tunity offered to them for turn¬

ing

Eastward their zone's econ¬
omy. It can only be pushed back,
if

the

Western Allies

making the

regions

attractive

beyond

the

succeed

they contftjl
people

shadow

living
of

the

Kremlin.

Touche,

Bailey
&
partnership effec¬
Sept. 1, with a general ac¬
countancy practice formed from
the merger of Touche, Niven &
Co., Allen R. Smart & Co., and
George Bailey & Company.
Of
nation-wide

importance and sig¬
new firm will ad¬

nificance, this
minister

its

business

coast-to-coast

from

offices

New

York, Chicago, Detroit, St. Louis,
Pittsburgh, Cleveland, Minneap¬
olis, Los Angeles, Seattle, and
Dayton.'
!

firm, with its greatly
personnel,
takes
its
of the largest serv¬

new

expanded

place

one

gold

supply

unsettled

was

be-

able

conditions

736,000,000.

reached

loans

become

justed of banks had dropped
$8 billion.
1

the

in interest rates,
demand for

the

security

between

been

developed

the

for

bonds it

Present clients of each of

every

fect

partnership,

under

new

principals.

the
The

same

oldest

Touche,

the

direction

three

Niven,-was

firms,

founded

1900; Allen R. Smart in 1922; and

George

Bailey

and

Company

formed recently in Detroit by Mr,

Bailey after

than 30 years

with Ernst and Ernst.

present
mittee

Chairman
on

Accounting

of the American

that

Com¬

conceivably,
could

new

for

firm

than 60 accounts

the national stock

exchanges.

rate-.

money market

adjusted

resumption

might

interest

to
Ion*

the

culminated last year, we do not
believe, practically speaking, that
the government authorities woul1

assump¬

built

business

in interest rates, but rather would

unit

prefer continued stability. How¬
ever, it cannot be overlooked that

the

1939

levels, and to

carry

unit

the

same

inventory and maintain the
unit volume of production,

same

mortgage loans.
Another point to be emphasized

the

will

sellers

Most

are

fully invested position, and
demand

for

credit

Keeping

sions

continues

to grow then banks will be sellers

policies to be determined by the

near

Congress, and what proportion of,

funds

agencies will absorb

and
a

mind

the

conclu¬
interest

government

rates, and turning to mortgage in¬
terest rates,
it logically follow i
that prospects are not for any

of government securities.
Much
will
depend
upon
the
budget

trust

the othe^

ment is powerful enough to dom¬
inate the money market.

govern¬

banks

hand, it would be foolish for any¬
one not to recognize the
govern¬

industrial corporations and
securities.

policy of lower interest
now changed and ap¬
working against ex¬

tremely low rates.

in considering probabilities is that
banks

further down-trend

rates, have
pear to be

and

many

see

ernment

reasoning applies to housing

ment

the forces, which in the earlier
period were favorable to the gov -

dollars would be needed because
of the change in price levels. The

term increase

Furthermore,

other

substantial

in such

very

loans

rates.

substantial

such

the

mortgage loans and the F.

H. A. loans carry

limitations.

becomes

available at satisfactory yields
life insurance companies
may also

liquidate

definite interest

Your

one

the

problem

then,

attempting

lowest

yielding

buy.

Also, not to be overlooked, earning assets and to replace them
absorption power of Sav¬ with higher yielding
assets, as for
ings Bonds sales. For example,
example, liquidate G. I. per cent
during the period April 30, 1946
to April 30, 1947, there was a net loans and to acquire F. H. A. Title
increase of about $2.7 billion in II loans when available, on which
Savings Bonds. During the same you do your own servicing, so
period special issues increased
that you may get a return of
about $4 billion.
On this basis
the combination of the two would 41/2%.
is

the

provide about $6.7 billion of ab¬
sorption power annually.

Joins Buckley Bros. Staff

Pressure for Higher Rates

of Ac¬

Institute

con¬

tion that inventories needed to be

Procedure

nominee for

Individuals of the

serving

the

Institute

countants and is the

Bailey is at

forces which

higher

conditions

are

the

balance the govern¬

down trend in interest rates which

have

ship will be served through the
of

conclusion
government

for

While

amount of the net sales of corpo¬
rations and banks. If long bonds

facilities

the

long term

those

make

force

needed

are

purposes.

fiscal
policy will
make
effort to hold back the ef¬

ment

in¬

the firms of the merged partner¬

augmented

long

mortgage portfolio

seems reasonable

clude that

proportion

States.

determine

sell your

United

not

Because

reached

ment

the

then

You have had the op¬
for
tremendous
in¬

mortgage

lic

Victory Loan at the tni;

ice organizations of certified pub¬
accountants

time

some

this time unless funds

and

estimates

term

support

It is assumed that your lor^

1946.

loans, have ranged
$12 to $18 billion

These

events

are carried at par.
It would
be unwise to disturb par bonds at

flotations

long

2Y2s

twelve to eighteen months for in¬
stitutional loans of all types, new

capital,

of 1945, and so did not need to
buy a large volume of long term
governments at high premiums in

Estimates

credit

since the

supply for that is cur¬
rently adequate to take care of
all legitimate credit
demands, but
rather, in relation to the supply
the demand is becoming
greater
and
therefore, on a demand sup¬
ply
relationship
basis,
there
crease

for

in the

creases

not one of

pros¬

at par

and

portunity

substantially increas¬
supply remaining
relatively constant. The point is

for

time

term 2%s.

the

pressure

the

decline,

basis

whether

time when the demand

term

change

cient time to review conditions

over

for credit is

should

decline, al¬

pressure

come

strictive

deflation of commercial bank de¬

and

the

tremendous

that all of you should have suffi¬

posits. Now the reverse has been
taking place and there has been

ing

seem

war

levels and
probably be maintained on a re¬

During the period of declining
rates
deficit
financing
through the banks was causing an
almost constant generation of de¬

decline.

not

near

great

would

interest

posits at

the
so

bonds

during the
deposits ad¬

total

year

are

Should

By
had

billion, and at the year end
the figure had jumped to over
$35
and a half
billion, yet
1946

consequence.

half

full

the
for

over

pects

level of about $31 and a

rates

est rates rather than

though

in the United States as an
indication
of
the
for
demand
credit we find at the end of 1938

billion.

for

present condition would seem to
favor pressure for a rise in inter¬

banks

about $21
of
1946

this post-war period appears to be
no
exception. This fundamental

slight increase in the monetary
gold supply, and as of April 30
the figure was $20,744 billion.
If we use loans in all
of the

were

debt

demand for goods and
credit, and.

slightly in excess of $20 billion.
In recent months there has
been a

middle

increase

market

open

past there has been

decline to

was a

retire

would

From that time until

May of 1946 there

not

However, this
does
likely. After every

high of $22,-

should

through transfer to non-market¬
able
debt,
then
the
tendency

June

reached

loans

if any—surplus will be earmarked
for debt reduction.
The govern¬

are

Niven,

Smart forms

tive

have to be re-started and worked

they

1942 had

dollars.

The

the

international

Touche, Niven, Bailey &
Smart, Accountants

chance,

bank

faster than the reduction in bankheld debt and the Treasury were

30, 1937, the
monetary gold supply was a little
over $12 billion and
by the end of

from

1948.

recalled

the

President

As long

loans

existed in the economic, po¬
or
cultural sphere.
Parts

the

increasing during the thirties

Unity of Europe." It is a purely
geographical
concept
and
has
litical

Theoretically,

monetary gold supply is the ulti¬
base for credit, and it is to

chasing the phantom called "the

never

For the time being at
least,
the gold supply is of
only theore¬
tical concern. If by some
sues.

fundamental

mate

Federation

Decisions

economic

Allies

reflected

abroad.

duction outruns demand. In
time,
the company might become the

Industries.

also

output whenever world

core

but

policy and direction,

conditions.

cause

can
supervise management
production. This control can
later be used for contracting Ger¬

are to get

top sped.

(Continued from page 4)
suit of fiscal

direct,

can

ana

the great removal scheme. If they

reparations, plants will

(733)

Interest Rate Possibilities

want

and

exclusive

reparation is not to be
degraded into mere looting, it

emerge from prison.

Control, production
tion

administrative

rule

could

Allies

agencies, through which they can
Germany, not political con¬

ing war in adequate quantities. An
intelligent policy of the Allies
have

today which will not
have to be modified tomorrow.

shown

rely.
an

they see in highly monopo¬
list capitalism the main cause of
war, have yet to prove, that mo¬
nopolist states are peace-loving.

re-armament,

Germany

ceptance of communist principles,
for Russia and her satellites are

used to

stage

they will be obsolescent
anyhow. Nothing can be done in
years

concerns

certain.

that

control, the fear that
they might be converted to war
production is senseless. In a few

and Turkey and of the
regions they dominated, have been
in Europe, but never
of Europe.
Today the unity of Europe is ob¬
tainable only by the West's ac¬

when its effects

trine,

•

who

today about

worry

understandable^

-over

The

output and determine prices dic-

tion too is not

war

futile.

are

Germans should be made to
work,
not to be given cause to
whine.

rather than by her
military shortcomings and
political mistakes.
It is equally

support - their
own
-armies got from their stupendous

But it has not

cartels

•

Na¬

CHRONICLE

under Allied

ma¬

from de¬
structive to constructive
planning
and set targets to
German produc¬
tion, instead of imposing

appliances,

•

ideal

resolutely

own

•

"up¬

tional Communism.
The merger of the two
AngloSaxon zones and
the new deci¬
sions about
ceilings, forshadowed
in
the
instructions
to
General
Clay, are the first steps towards

•

'•

after-

resurrection,

be camouflaged

its

rooted,"

Nor

France,

and

It has increased under
and
through the Allied occupation. It
is
producing millions

past and will not pay in the fu¬
ture, for sooner or later, an up¬
surge of enthusiastic nationalism-

War

worse.

terial

releasing the communist forces

World

& FINANCIAL

attempting

probabilities

one

increase

bank

crease

should watch the

loans,

in government

Savings

creases

(Special to Ths Financial CHnomcx*)

judge future

Bonds,

the

de¬

LOS

ANGELES, CALIF.—C. R.

Klingensmith has become associ¬
ated

with Buckley Brothers,

530

debt, sales West Sixth Street. In the past he
in¬

was

in amounts of special is¬

Inc.

and

the

with

Franklin

Wulff &

Co.,

(734)

THE

Investment
(Continued from page 2)
agerswho sold securities during the
first

quarter

incorrect

were

procedure

the

holders:

course

Fundamental Investors in its re¬
view of economic trends
published
in
the
semi-annual

has

that

the

are

holiday
contributing fac¬

moment.

porarily, at least,
tionary forces are

defla¬

work, with

the

government
withdrawing
funds from the
economy and the
removal
of
rigid
for
support
short-term government securities.
But the

underlying

forces,

the

•available

porate
of

huge

for

individual and

countries,

are

still

very

much

alive."

among the die-hard optimists dur¬

supply

money
at high

Thursday, August 21,
1947

following
warnings

In support
servative

of these

con¬

in¬

foreign

propaganda

powers

proponents of

offices of
and the domestic

nature

porary

and

must

and

incomes

forces

following

masterly

restraint:
been

piece

stock position shown

mon

seem

well

than
to

we are

that

aware

present
boom
conditions cannot last
indefinitely
and that the
longer correction of

excesses

optimistic

and

delayed, the
to

the

maladjustments

more severe is

process

functioning in the
under

the

control

management continues

that the uncertainties
in the bus¬

the

wise

has

still

one

maintained

irust

fully

iness

which

invested

outlook

not

to believe

warrant

heavily invested position in
mon

the

Quarterly Periods

com¬

stocks."

Fund,

Net Cash & Govts.

Thousands

and

End of

Funds:

March

Axe-Houghton Fund
Axe-Houghton "B"
Commonwealth Investment

162

23.3

was

339

151

purchased by three
trusts.
Contrasted with this was
the sale
62,800 shares of
Colgate-Palmolive-Peet by five

managements.

Airlines Popular
While in the previous
period, a
was shown in
the

slight interest
stocks

5-3.1

68.4

7.0

69.5

68.3

69.4

72.6

72.3

22.7

127

43.0

37.0

17.9

15.6

38.6

11,425

12,303
438

■

543

63.2

27.2

23.9

**'

19.0

20.7

22.0

9.3

51.9

10.9

93.0

6.7

7.0

1,207

None

11.4

None

22.4

None

93.3

253

24.2

1.2

24.1

10.9

2.3

76.4

6,294

2.6

88.6

11.2

None

73.2

73.6

167

6.2

11.0

1,948

2.9

567

4.0

558

None

10.5

None

97.1

96.0

ored

None

89.5

and

1,770

0.9

9.7

89.1

87.9

2.3

2.1

8.7

None

91.5

88.2

36.2

None

27.9

None

89.0

91.3

20.6

None

16.0

None

63.8

preceding quarter, General Elec¬
tric was a poor
second, only three

None

72.1

10.9

1.9

8.8

1,303

18.0

162

642

10.5

None

82.0

None

86.4

4.5

97.9

99.:

3.5

85.0

81.5

11.0

12.0

8,763

4.1

4.5

9.1

722

5.6

39.3

—

440

340

1,690

2,980

—

102

Investment Corp

9,739

American European
Securities

National Bond & Share
Selected Industries
—ii—

$$U. S. & Foreign
Securities—.

International Securities.—

$7.5

10.6

16.4

15.7

6,322

1.1
0.2

13.4»

0.6

$8.2

5.5

30.4

17.8

824

830*

$5.2
$20.9

1,862

$19.4

1,273

$4.5

1,239 '

-1,014
*

95.8

vester

88.2

79.5

pany of this group
ored

$4.2
!

2.1

17.4
'

72.3

0.2

93.7

89.2

83.4

83.7

5.9

86.2

87.0

85.9

0.5

None
None

None

5.8

6.3

None

65.5

69.

82.2

82.

76.0

9.5

82.

71.1

9.3

71..

85.9

85.

88.3

None
700
2.1
97.9
♦Investment bonds and
97.
.2.0
None
preferred stocks:
:
None
97.9
Moody's. Aaa through Ba for
**No interim
'98.0
bonds; Fitch's AAA
reports
to
^Portfolio exclusive of
through BB and approximate
stockholders on this date;
securities in
equivalents
^Percent gross cash and
subsidiary; and associated companies.
governments as reported
*
by company
-

for preferreds.

Was

given

two

half

these

mitments.

making lieW''

There

wereno

com¬

de¬

creases

holdings. .In:!cont;rast
this, while five managements

with

purchased
of

3.4

7.0

com¬

large finance com¬
Four
trusts, purchased
4,500 shares of Commercial
Credit,

sold

9.5

None

the

82.6

9.6

2.9

only

88.

$19.1
$4.9

7.5

the

Conspicuous attention

85.8

3.1

was

distinctly fav¬
during the preceding' thr^ee
month interval.
:J.-v :
s

89.0

$5.0
$14.2

$4.4

which

panies.

0.4

0.8

17.2

14.2

846

0.8

trusts, however, fav¬
outstanding manufacturer

Company, and three out of
these six included
the stock of
this
company as a new addition to
their portfolios.
Case was also
liked, * but scarcerly any interest
was shown in
International Har¬

5.5

agricultural equipment, Deere

61.5

64.3

33.7

709''

managements displaying an inter¬
in its securities.
Twice this
number of
est

80.7

26.6

•

54.8

2,654

701

0.7

In contrast with the

94.4

85.0

360

989

0.7

19.8

portfolios.

55.6

;

17.5

4,460

88.0

6.5

None

691

•

None

5.1

None

349

12,499

None

19.3

542

19,650
2,000
1,024

95.5

90.9

25.8

840

None

18.2

6,423

Lehman Corporation

80.5

None

95.8

15.0

12,212

3,224
6,640

82.0

19.4

610

General American
Investors
General Public
Service—.
General Shareholders

7.5

None

4.2

11.1

3,525

—

■„

0.1

32.0

7.0
'

12.0

Companies:

Tri-Continental Corp.

None

952

9*35

87.2

None

T—

89.3

•

15.0

7,882

Republic Investors
Selected American Shares
Sovereign Investors

84.0

0.9
'

914

Mass. Investors Trust
Mutual Investment Fund
National Investors

79.4
1

13.6

2.1

462

Loomis-Sayles Mutual Fund
Loomis-Sayles Second Fund—

$:j:American General
Corp
Blue Ridge
Corp
Capital Administration
$$First York Corp

28,400 shares. Five of these
purchases were new contributions

1,187
1,238
3,596
1,158
2,603

971

of America

eliminated by two others.

comparatively heavily bought, ten
trusts making total
commitments

1,467
1,706
4,516

Management Fund—
Knickerbocker Fund

holdings of two man¬
Among equipment

102

Investors

Pan

increased

ing manufacturers of electrical
equipment.
Westinghouse was

6,157

General Capital Corp.
Incorporated Investors

these.

also carried
over
from 'thd
preceding three
months in shares of
the two lead¬

67.1

611
-

also

Continuing interest

50.1

67.8

249

Fund

was

67.6

29.2

22.9

dis¬

manufacturers, United Aircraft
Douglas were purchased
by
four and three
companies respec¬
tively, but Consolidated Vultee

29.2

;

manu¬

and

66.9

38.5

22.9
'

three
was

agements.

53.5

17.5

among the

39.0

24.0

18.9

8.5

578

57.1

57.0

None
'

43.6

29.1

490

Fundamental Investors

U. S. &

17.5

6.8

First Mutual Trust
Fund

:•

55.5

18.2

\ 1,924

Eaton & Howard Stock
Fidelity Fund

Closed-End

13.0

34.4

addition

American

23.6

Funds:

Dividend Shares

State St.

68.9

13.4

519

com¬

for both the

were
each bought
by four
companies, the latter being a new

68.3

20.6

3,246

73.8

21.2

373

airline

ern
June

23.3

3,678

certain

popular among this
group, six
companies adding
27,400 shares to
their portfolios. United
and East¬

-End ofMarch

18.3

23.9

most

15.8

28.9

sub¬

was

17.1

5.0

American

played during the second
quarter.
American Airlines was the

10.5

12.1

also

While
15,400 shares
Cyanamid common

Among drug and
pharmaceutical
companies, Johnson and Johnson

90.2

3.5

Commercial

Industries

bought by two trusts.

transportation and selected
facturers of
equipment

86.4

14.0

Her¬

was

bought Con-

3.0

483

purchased

stituted in their
portfolios shares
of the new
convertible preferred.

Per Cent

1,179

1,270.

their

number

stock, two of these companies

Com. Stks. plus Lower
Grade Bonds & Pfds.

June

2.4

a new com¬

five companies sold

grade

24.9

3,675
1,148

1,321

Broad Street
Investing
Bullock Fund

Investment Co.

12.8

6.8

14.6

459

3,568

Wisconsin Investment Co

Delaware

11.0

438

482

Fund

Stock

15.7

George Putnam Fund—
Russell Berg Fund
Scudder Stevens & Clark

Open-End

111

490

Investors Trust
Howard Balanced
Fully Administered Shares
National Securities-Income
Nation-Wide Securities
Nesbett Fund
&

Wellington

11.2

also

panies, marked favor

-End of-

484

March

same

Powder and
Solvents. Newport

total of 57,000 shares of
Louisiana
Land and
Exploration and a like

Per Cent*

June

836

General

Eaton

March

balance, three

making

The

companies

Investment Favorites

InVest. Bonds &

-End ofJune

one

cules

Standard Oil of New
Jersey was
easily the favorite among the
petroleum stocks, eight
companies
making additions to their
port¬
folios.
Four trusts
purchased a

Preferred Stocks

Per Cent

Although

recently added it

mitment.

similarly defensive posi¬

tions.

sold

was

trusts

bonds and preferreds.
Wellington
Fund and General
Investors Trust
were

managers.

portfolios,

new¬

lower

additions

was

during
;he preceding
period, Union Car-

June 30th, these three
trusts had
less than of their assets in
stocks

pur¬

popularity finding favor
with
our
ride

60%

common

although

relatively small lots,
companies made
purchases
of which were
new

f| portfolios. Monsanto

business

June, 1947

Net Cash & Govts.

of Dollars

ive

comer to
the ranks of the bal¬
anced portfolio
companies. As of

number of
companies

March and

chased

during the pe¬
Nation-Wide Securities

Nesbett

Investors

Du Pont was the
favorite
among
;he chemical stocks

stocks

did

11,100 shares
Consolidated Natural
Gas.

likely

United

Soviet regime in Moscow."
Like¬

addition

preferred
and

the

Skelly, Shell Union
and
Standard of California
were also
well liked.
In the
natural gas
field, two trusts exercised
rights
purchase a total of

Russell
Berg Fund built up its
backlog of investment bonds and
riod

pur(,

Indiana
commitment

Trust.

upon

correction."

during the period ascribes earlier Similarly Russell, Berg and Com¬
forecasts of an incipient
depres¬ pany, in a letter to stockholders
sion to an "organized
dated July
3, 1947 state: "the
propaganda

effort

structure.

com¬

in this

entire

our

was

Oil

93,450 shares of Standard
Oil
Ohio by
Massachusetts

corrected, will eventually filter
through the direct consumer
to

Standard

individual

for the period

back

outlets

and

Largest

which America has been
built has

self

"Your management has

willing to maintain the

Nevertheless,

rather

forces

Balanced

Oil

eventu¬

ally end; that the
prosperity

regimented econ¬
omy." Regardless of such submis¬
a

Balance Between Cash and
Investments of 50 Investment
Companies
End
Open-End

tinental, Gulf Oil, Ohio

managements, attention

tem¬

tion—the

that

outlook supported
by above-aver¬
age aggregate purchases of stocks

States

"Fully Invested"
Incorporated Investors has been

fully

believe

Another fund with

cor¬

coupled with the need
additional
loans
to
foreign

stock¬

dominant."

supply

use

remain

because

inflationary
deflationary

inflationary

money

the
dire

not developed and does
not seem report in the face of
pessimistic
likely to; that labor-management sentiment and talk of a
recession
and labor
productivity are much during the last 12 months (67.6%
better than
they were; and that of portfolio).

Tem¬

certain

levels; that the ex¬
pected slump in consumer buying
of durables and non-durables
has

the volume of

expenditures
tors

are

The vast export move¬

and

"The

reason:

In his semi-annualseem high
report to
brought about stockholders, James N. White of
by genuine demand rather than the Scudder, Stevens and Clark
by speculation; that inventories Fund concludes his "Investment
are not
large with respect to sales; Review and Outlook" with the

employment

high..

includes

the level has been

been reinvested:
"Business is still
at boom levels and
ment

pand; that while prices

report
to
stockholders explains
why a con¬
siderable part of liquid funds ac¬
levels

CHRONICLE

cautious policies of business
not depended on
aggregate pur¬
respect to inventories and sion to current post-war
hysteria, chasing power alone, but the dis¬
expansion have prevented over- there are several rather
respect¬ tribution of that
purchasing power
accumulation
and
a
disorderly able investment managers who see so as to make it
effective on a
price rise; that the foreign and signs of weakness in the
current broad
base; that current high
domestic demand for goods is
gen¬ picture.
prices have weakened this
base;
erally strong; that both industrial
and
that this
and home construction will ex¬
Caution the Watchword
weakness, unless

look.

higher

with

unanimity among the
heads of investment trusts on the
future economic and financial out¬

portfolio

the

lack of

cumulated

report

"We

vested

investment

managers? Needless to say, as in
investment circles
generally, there
is

FINANCIAL

Companies Bought in June

ing the preceding 12 months and
increased cash slightly
for the
first time during this
quarter. It

semi-annual

tempered optimism

during June determine the
of

impending business reces¬ is called to a theme that has been
is therefore
particularly interest¬ sion can usually be traced to repeated
constantly in these quar¬
ing to observe what its President, those who
apparently have some¬ terly surveys—that post-war in¬
William A. Parker, says in his
thing to gain from such a condi¬ flationary booms are of a

their appraisal of the outlook over
the next year? Does stock market
sentiment
which
shifted
from

pessimism

COMMERCIAL

C. I.
an

Interest
stocks.

folios

total of

5,900 shares

Financial, t^vo others
aggregate of 1(1,500 shares.
continued
A newcomer

in
to

insurance

the port¬

two

companies was the
American Insurance
Company of
Newark, N. J. A like ntimber Of

investment companies bought se¬
curities of Continental Insurance.
Single purchases were also made
of

American

Reinsurance, Conti-

Number 2622

Volume 166

THE

COMMERCIAL

nental

ber.

Fire

nated the stock of this
latter

Casualty, Fidelity-Phenix
and Great American Insur¬

Two

trusts

entirely

elimi¬

large

two

The

companies

can

both added to the portfolios

were

The steel stocks

portfolios. Three
investment companies sold Good¬

rich and

popular."
weeded

similar number light¬
holdings of Firestone, two

ened

States

managements. Continen¬
the favorite completely cleaning out this lat¬
ter issue.
since three additional trusts in¬
creased the stock of this indus¬
trial which was already included
among
their security holdings.
Three food stocks were each pur¬
of three

sold

tal Can, however, was

Five
out

public

and

actions

two

resulted

portfolios.

—Bought—

Among the shares of office
equipment companies, Remington
year.

2(1)

pany is apparent since in the. pre¬
vious period it was sold by, three

-Sold-

the

ments

"B"

nolds
two

this

also

incentive.

managements.

metal

stocks

6(1)

27,400
2,200
18,600
1,800
14,100
23,400

3(1)

4(3)
2

Rey¬

favor

with

4(2)

Non-ferrous

4(3)
None

lightly pur¬
Aluminium, Ltd., Homestake,
Hudson
Bay
Mining
&
Smelting, and Phelps Dodge were
were

of stock dividends.

issues

the

thus

Gas

west

5(2)

3(2)

3(1)

the

North

for

the

This

Electrical

Cleve¬

Financial

dend
ana;

conversion

Public

while

the

Edison resulted from
dividend.

of
a

divi¬
Indi¬

.for

Columbia,

Container

Colgate-Palmolive-Peet

ter,shades
were

by two trusts.

the

evi

3,000

Continental Insurance-

rubber ; com

holdings

and United States Rub

None

Amer. Insurance Co. (Newark)C. I. T. Financial Corp.
Commercial Credit

10,500

None

and

None

Middlewest Corporation

6,500

None

Public Service Co. of New Jersey
United Light & Railways..
West Virginia Water Service9

Gulf States Utilities^
Illinois Power

None

—

None

...

None

5,200

Kl)

None

12,100

400

Peoples Gas Light & Coke______

2(1)
2(1)

1,773

18,800

2(2)
2

2,600

Chesapeake & Ohio.

None

Union Pacific

600

None

Equipment:
500

None

Nat'l Malleable & Steel

None
Trade

and

2,200

None

3,600

Chain

3(2)

Stores:

F. W. Woolworth Co.

300

None

Castings

American Locomotive

None

Montgomery Ward

None

5(2)

None

2(1)

None

11,300

Rubber and Tires:

.*>

None

Firestone Tire & Rubber______

1,300

None

Goodrich

United States

Rubber..——

6,100

Goodyear Tire & Rubber

500

4,000
5.200

3(1)

8,000

Company

4(2)

5(2)

None
None

None

General Refractories

None

Republic Steel

None

United States Steel

None

4,200

3(2)

2,900

...........

Textiles:

None

4(4)

■

*6,700

■

None

1
-

■

Celanese Corp. of America
Industrial Rayon

None

1(1)
1(1)

13(8)

2(1)

•

V •

5(5)

r'.-t.

'■*

4,250

3(3)

3,300

•

2,300

None

United Fruit

None

Industrial

1(1)

None

3(1)

None

——

.4,500

—

_______

Industries

2,600
3,800
14,000
1,300

.....

Joy Mfg. Company

.—

United

Tobacco "B"_—
Philip Morris & Co...........

iTwo

common,
ferred.

3(2)

None

3(1)

1,900 shares

Received,

Engineering & Foundry

2,200

Received

Purchased

2(2)

Mining:

American

of Worthington received
dividend

dividend

on
on

10% stock dividend.

American Gas & Electric.
Middlewest Corporation.

great part through

rights received from

North

Co.

None
None

Stock dividend of 10%.

None

Received

in exchange for Mass. Utilities Assoc. pfd. and Mass.

100

—

5,700

—

2(1)

Pwr. •& Lt.
9

None
.

None

2,500

dividend

Purchased

5,000
5,000
1.700

2(2)

Public Service of

Indiana.

partial liquidating dividend

North American Co.

}n whole or in part thru exercise of rights.

NOTE—This survey

1(1)

pfd.

Received

trusts

Rayonier
—-r—
■Kimberly-Clark Corporation

3(1)

,8;500

None

—_—-

Hudson Bay Mining & Smelting
Phelps Dodge

National Cash Register
Remington Rand —:

None

———

______

13.500

•

managements sold 6,900 shares of American Cyanamid
but substituted 4,167 shares of the new convertible pre¬

McCall Corporation

11,300

400

Homestake Mining

None
-

Greyhound (new)
Newport News Shipbuilding..—

—•—

Belt
_____

R. J. Reynolds

Miscellaneous:

Equipment:

Allis-Chalmers

American Tobacco "B"10

36,200
2,700

1,010
3,000

—

Newmont Mining

6,300
xNone

American Rolling Mill

1,100
1,200

None

—

Standard Brands

Aluminium, Ltd.

None

New England Electric System8__
New England Gas & Elec. Assn.
Public Service Co. of Colorado._

Retail

None

National Dairy Products-i

and

8,100
8,950

None

Tobaccos:

Paper and Printing:
v

None

Indiana Gas & Water Co.L

Railroad

None

_—

None

4,000
4,500
3,600
3,200

2(1)

quar

None

Cleveland Electric Illuminating^
Columbia Gas and Electric—__
Commonwealth Edison Co

Engineers Public Service

Office Equipment:

liquidated. Four man

decreased

None

Westinghouse Electric

None

—

Banking:

None

2(2)

General Electric

Dresser

272

None

None :

62,800

None

3(3)

Electric3-—

None

1(1)

5,300
1,400

None

Johnson and Johnson——

National Acme

trend

City

8,730

None

the

—

Corp. of America....

None

Continuing

Goodrich

Continental Can

Gas and Electric, Com-

sold

.None

American Can

Atlantic

Central & Southwest Utilities.^
Central &' Southwest Corp.4

5(3)
■

None

3(1)

None

1(1)

1,500
15,400

Co.1...

None

Metals

None

Railroads:

None

Glass:

Link

dence during the preceding

agements

Cyanamid

500

United Light and
Railways. Peoples Gas Light and

panies

American

None

JerS^y !ahd
was

None

Union Carbide

National Supply
—
Worthington Pump & Mach.2__
American Machine & Foundry._

Corporation, Public Service of
Colorado;1, Public Service of New

Coke

Newport Industries

None

Common¬

None

2(1)
4(1)

wealth and Southern, Middlewest

2(1)

None

1,600
2,500
2,450

„

None

4,100

Standard Oil of New Jersey.—
Standard Oil of Ohio..

700
200

liked

Edison,

500

_____—

Hercules Powder

None

Wealth

13(13)

3(1)
3(3)
3(1)

Monsanto Chemical

and

Machinery

individual

any

those

Corp...

Solvents-—

were

Among

________

Equipment:

11,900

3(1)

portfolios,, not resulting from
SDecial circumstances, buying wap

None

Steels

5,500
7,500

4(2)

10% stock

None

_________

Standard Oil of California——
Standard Oil of Indiana—.

None

2(1)

Products:

Among the other utilities added

issue.

: |

Detroit

preference

(new)

4,500-

Food

diffused,,. n<y more than three or
four
trusts,1 at the most, showing

3(2)

and

Service

additions

5(3)
4(2)
2(1) '

pre¬

Gas

distributed

was

Indiana

du Pont

110,900
5,900

2(2)

Commonwealth & Southern—.

Cement

Commercial

4,700
28,400

10(5)

0,800 out of a total of 9,800 shares
of Illinois Power
were
acquired
issue:

Star

100

........

1,000

tfope

'500
None

—

15,233 V2

2(2)

None

Co.

National Gypsum
United States Plywood

19,500

Electric
Illuminating
Co,
Gulf States Utilities
was
pur¬
chased through exercise of rights:

ferred
Water

None

1(1)

None

,'L

—.

3,000
17,400

3(3)

2(1)

3(2)

None

1,000
"

Shell Union Oil

Skelly Oil

None

Detroit Edison^

land

through

None

Drug Products

were

purchase

4,000

Lone

None

Pure Oil

None

1,375
39,800
33,186
16,000
5,300

■

Reynolds "A"

Johns-Manville

2,500

None

also
distributed
in large part

comnany

rights which
used

American.

and

3(3)

13,300

None
—

9,130
81,500
9,800

3(2)

1,500
8,200
7,100
5,000

6(3)

plan of the New England
Power System; and
West
Vir¬
ginia Water Service
stock
was
given out as a liquidating divi¬
by

7,500

10,600

Glidden

and

No. of

Trusts

Ohio Oil Co.

5,200
85,000

5(5)

None

3(3)

cation

latter

None

Containers

Utilities:

2(2)
v

Sold

No. of

■

•

Corp.
Louisiana Land & Exploration..

25,000

None

2,200
4,900
12,300

Nqw England Electric System .was
.delivered .as part oL the simplifi¬

dend

_____

None

41,100
1,400
1,100
6,100

or completely

—

133,500

2(2)

3(1)

Chemicals:

3(2)

and South¬

7,700
15,800

__i_
Sherwin-Williams

None

stock

14(12)
3(2)
2(1)

National Lead

None

heavily

issue,

Gulf Oil

2,152
10,000
295,100

9(9)

Minneapolis-Honeywell

500

Corporation;

Devoe

None

Corporation, except 1,500,
distributed by the Middle-

were

11,400

American

shares of the Central

6(6)

None

Electric; all the 295,100

and

Public

1(1)
2(1)
2(2)

1,000
52,500

Corporation
Schenley Distillers

500

Issues

groups.

purchases of

new

Consolidated Natural Gas10
Continental Oil

95,336

1(1)

2,000
7,900
1,050

None

stock

24)

page

None

Consolidated Vultee Aircraft

400

shows

the result of

4(1)

None

United Airlines

None

Subtraction of

declared

2(1)

2(2)

None

Distillers-Corp.-Seagrams

"buy" side against 41 on the "sell."
Thus, additions of Atlantic City
were

2(2)
5(4)'

Airlines—

Pan

Nehi

None

worksheet that there were
43 transactions
remaining on the

Electric

2(1)

American Airways—
United Aircraft

Eastern

None

2(1)
2(1)
4(1)

our

dividend

Canada Dry Ginger Ale

result

received,

None

Building Construction and Equipment:

rights and that several
were

4(1)

5(1)

None

Nonq

„.

additions

None

3(1)

that many of
the purchases were made
through
the

57,000,
7,300
6,000
2,500
2,600
4,300
5,500
9,350

77,700

Douglas Aircraft

None

indicate

exercise of

Natural Gas:

3,900

2,000

American Airlines

None

Even

notes will

4(3)

4,300
1,600
14,300

Co.

None

While
the
utilities,
on
first
glance, appear to be outstanding
favorites, closer inspection of the
accompanying tables
and foot¬

the

Motor

None

Newmont Mining was
About

4(1)

Beverages:

sold.
Utilities

None

____

None

best liked.

management

entirely

11,100
22,300

chased.

Glass—__

Chrysler Corp.

White

Aviation:

commit¬
without the

found

Libbey-Owens-Ford

1,100

None

Studebaker

new

added

were

Borg Warner

Fruehauf Trailer

these acquisitions were
through the
exercise
of

stimulus

None

3(2)

None

number of

(Continued

•>,

None

port¬

No. of

Trusts

Parts:,

None

made

No. of

1,500

under

made in the shares of

rights,

as a few managements made
commitments in Borg Warner and
Libbey-Owens-Ford Glass. Little

•

No. of
Trusts

——_

None

American Tobacco "B." Althorugh
many

from

Petroleum and

J. I. Case Co.__.
Deere and Co._

pur¬

period

panies

elimi¬

4,900
4,700
2,500

during

—Bought—

No. of

Auto and Auto

trusts.

was

two

Motors

3,500
12,400

6(3)

review

favorable attitude was en¬
tertained towards the parts com¬

Stude-

sold by five man¬

was

while

White

liked.

chases

baker also
nated

well

too

agements

Agricultural Equipment:

Cash

outstanding

complete

not

was

Fruehauf Trailer was dis¬
by two companies.
A

the

trans¬

No. of

Trusts

these
in

*No. of

One

United

companies
total of 4,200 shares of Re¬

posed

Five
decreased their

holdings of Chrysler which, along
with several other motor
stocks,

(March 31-June 30, 1947)

portfolios and decreased in none

and

Three

folios,

managements

Transactions in which
buyers exceed sellers—or sellers exceed buyers—by two or
sola are in italics.
Numerals (1) (2) (3)
(4) indicate number of managements making
eliminating the stock from their

during the first three months of the

Rand

un¬

completely

holdings

Steel.

(735)

elimination from portfolios.

also

were

trusts

nies.

Brands

CHRONICLE

Qhanges in Common Stock Holdings of 36 Investment Management Groups

chased by four investment compa¬

While, of these, Standard
and United Fruit were
shown
marked preference only
during the June quarter, National
Dairy had been increased in two

FINANCIAL

Steels in Disfavor

com¬

pany from their

ance.

covers

51 trusts but purchases or sales of

sponsored by one management group are

treated

unit.

example, the six trusts sponsored by J. & W. Seligman are
as having the weight of one manager.
Overseas Securities
included in addition to companies listed in companion tables. *
For

considered

(736)

THE

COMMERCIAL

FINANCIAL

CHRONICLE

Investment Companies

The State of Trade and
Industry
Bought in June Quarter
(Continued from page 5)

(Continued from

ing to "The Iron Age," national
metalworking weekly in its current

23)

page

interest was displayed in General
Motors, only one transaction oc¬
curring on the "buy" side and
none

review of the steel trade.
The issue

conspiracy

the "sell."

Among

the

non-alcoholic

bev¬

Canada

Dry.

the unwanted sister

was

price

will probably emerge
bloody but unbowed.

the alcoholics, three man¬
Those who have
carefully watched the Federal Trade Commis¬
agements disposing of their hold¬
sion's pot shots in this
10-year old skirmish give at least three
ings, two of which completely I reasons
why the multiple basing point system is expected to survive
eliminated the stock from their
the paper points out:
(1) No one has conclusively proved 4lir«+ H-iaro io
that there is
portfolios. Distillers
among

Corporation-1

with two trusts.

While the accompanying tables
would seem to indicate that sell¬

ing

predominant in the ma¬
chinery and industrial equipment
shares, sales were actually bal¬
anced by additions scattered over
several individual
issues.
Com¬
panies in which single purchases
was

occurred were

better

-i

ivr

(2)

The

smoke

screen

charges that the

extra charges

remain

American Iron

and
involved in fixing prices and
be proved.
What evidence can be un¬

Steel Institute and its members

are

covered in the face of the
Institute's

mitments.

their

new

com¬

Liquidation

had

also

practically stopped in the issues
of

merchandising companies.

fact,

two

companies

additions

their

made

In
new

portfolios

result

RAILROAD FREIGHT LOADINGS
UNDER LAST WEEK
BUT ABOVE YEAR AGO

the

block

of last year.

8,000 shares

was

amount

already held in its port¬

folio.

During the period reviewed, the

stock

market declined to
May 19
a
recovery phase
over a period of
approximately two months
be¬
yond the end of the half
year on
June 30. There followed the

and then entered
which extended

—

recent decline

averages,
third

which,

was

the

movement.

equal

about

preceding

recovery
time of this

the

writing, markets
mate

measured

are

stale

and

there is the usual con¬
fusion in opinion. While
there are
many factors

vidual

trust

decisions,
portfolio

nificant,

determining

indi¬
investment

group's
composite

picture of

changes which are sig¬
does, when considerec

along with statements
agements, give

some

of the

man¬

indication

outlook

during a previous period
As
indicated, there was a diversity
of opinion
during the second quar¬
ter of the
year.

Although modes
purchasing among the
majority o:
groups, following upon the
firs
quarter's
this was

liquidation,
countered

bearishness in certain
ters.

was

noted

distinct

other quar¬

New Phila. Exch.
Members
PHILADELPHIA,. PA.
The
—

Philadelphia
announced

Stock

the

Exchange has

election

bership of Robert

mem

A. Maes, John P
Hart and Howard A.
Foster. New
ton J. Aspden
has been
postec
for
membership it was also an
nounced.

corn.

Oats

touched

established

new

seasonal

markets

selling by packing interests. Domestic
demand
continued on a liberal scale.
;
irregular last week.
Checking the down¬
the preceding
fortnight, prices moved

movement

in the

were

forepart of the

following

week but declined

upward

sharply in closing sessions

announcement of the government's
first crop

report, issued last Friday, indicated
was larger than
the trade has

yield of 11,844,000 bales.

anticipated, and

actual outturn of

estimate. The

compared

This

with

8,640,000 bales in the preceding
crop year. The New
York spot quotation
showed a net drop of 63
points for the week.
Trading in leading cotton textiles
was
less, active.
While

prices held firm, sales of both
printcloths
spotty and limited in volume. Interest in

and

sheetings

were

heavier drills and twills

showed improvement and
ings was noted.
:

some

export business
V

heavy sheet-

There was increased
interest in the raw wool
market last
with volume estimated at
week,
between 4,000,000 and
7,000,000 pounds. In
Texas and throughout the
West,

buying

was

active, influenced
reinaugurate
and revise its
selling prices. Spot foreign

its wool purchase
program
remained very scarce.

wools

during

Contracting for the new wool clip in
advancing prices. Imports of apparel
Aug. I totaled 2,625,600
pounds, com¬

pared with 2,750,800 in the
preceding week.

RETAIL AND
WHOLESALE TRADE SHOWS SLIGHT
CHANGE
FROM YEAR AGO
A summer heat
wave which covered
many parts of the

discouraged retail buying the past week.
Total volume
ately below that_of the previous week
and about
the

even

corresponding week

year ago,

in its current review
of trade.

Consumer? generally
goods, particularly

reports Dun &

manifested

was

country
moder¬

with that of

Bradstreet, Inc.,

preference

for

seasonal

reduced-priced items, although in some
areas
Instalment buying
increased,

fall merchandise was
well received.
but collections were
less prompt.
Food

AUTO OUTPUT FALLS
BELOW

Excessive

heat

combined

EXPECTATIONS

with

the

strike

the Murray
Corp
according to Ward's Automotive
Reports, was responsible
or the
industry's failure to achieve an
expected output of well over
100,000 units the previous week.
However, the industry sooner or
later hopes to find a solution
for most of its

plant,

labor problems and

of its materials

some

shortages such as steel which
interferes greatly in the
completion of body work and final
assembly line activities.
Last

week

car

and

truck

83,648 units compared with
and 88,990 units a
year ago.

production was
revised figure of

placed

Ward's

79,017 units last

week

Car production totaled
58,943 in the U. S. and
3,720 in Canada
Commercial vehicles amounted
to 19,120 for the
U. S. and 1,865 for
Canada.
'

forced* volume

down.

Fresh

fruits

and
vegetables, along with dairy products and
cereals were
popular, while
cold cuts, seafood and
poultry sold well. The demand for soft
fruit juices, beers and
drinks,
ales continued to be
large. The shortage of
gelatine products

continued unabated.
The response to
clearance sales of summer apparel was
generally
good with women's cotton
dresses and sportswear in
fair demand. Re¬
tail buying of
cotton and other
piece goods for women's
dresses re¬
mained at a high
level, while interest in fall clothing and dark sheer
hosiery increased in some areas,
Despite extensive
coat volume was
advertising fur
slight. The demand for men's
lightweight suits and
fall suits was
substantial with men's work and
dress shirts selling
well.

;

Hot
week

summer

was

weather in
many sections of the United States
las

accompanied by

desultory consumer buying which resulted
falling moderately below that of the
previous week
slightly lower than that of the
corresponding
generally, centered on seasonal merchandise
price-consciousness remained keen. Clearance

in retail volume

consequence it was
week of 1946.
Interest
and consumer

motional sales increased
in

and pro¬

effort by retailers to
stimulate
in wholesale volume in the week
were

Changes
purchasing remaining at
moderately above that of

buying

negligible with
high level of the previous week
anc
the
corresponding week a year ago. Re

the

tailer caution continued
to be evident but
somewhat abated.
the supply of some"
items, they continued to be limited.

As for

Following a two-week decline, commercial and
industrial failures
turned up in the week
ending Aug. 14, rising to the
highest number
in six weeks at 78 as
compared with 60 in the
preceding week and
17 in the
corresponding week of 1946, Dun &
Bradstreet, Inc., reports
Ever since October last
year, failures have been
consistently higher
than in the previous
year's comparable
weeks, though far below
prewar level.
Failures involving liabilities of
$5,000
49 to 61, or five times as
many as

or more

were

from

year

ago when 12
concerns
group.
Small failures under
$5,000, although
continuing at a low level, rose from 11
last week to 17 in
the
week just
ended^ The uptrend from 1946 was not as
sharp in this
size group.

this size

The week's increase
occurred in
retailing*
service.
In these trade and

mercial

50%
from

or
a

more.

The

number of

construction, and
industry groups, failures
manufacturers failing fell off
a

week ago and
wholesale

Retail volume for the
country in the week ended on
of the previous
Wednesday
week was estimated to be
from 3% below to
a
1% above
year ago.
Regional estimates changed from
those of a year ago

by the following
percentages: New England and East
declined 0 to
4%, Middle West 1 to 5%, and Pacific
Coast 2 to 6%.
Increases were:
South 5 to
9%, Northwest 0 to 4% and
Southwest 3 to 7%.

Wholesale volume for the
week
the previous week
and
week

BUSINESS FAILURES INCREASE

failed in

Known makes of
major appliances and some
types of hard¬
continued to be in very
large demand with some
improve¬
ment noted in the
supply of electric motors.
The volume of
household and garden
furniture, garden implements and
paints
was
substantial. Automobile
supplies and accessories were in
steady call, and buying of both
low-end and expensive aluminumware decreased.
ware

SUMMARY OF TRADE

failures held
steady.

com
rose

little

year

ago.

was
steady at the high level of
moderately above that of the
corresponding
hesitation in

Retailer

stocks continued to
diminish.

deliveries of

some

replenishing merchandise
Shortages persisted in some lines with

products slow.

Department store sales on a
country-wide basis, as taken from
the Federal Reserve
Board's index for the week
ended Aug. 9, 1947*'
decreased 3% below the
same period
of last year.
This compared
with an increase of 1
% the
preceding week. For the four weeks ended
Aug. 9, 1947, sales increased
by 3% and for the year to date
by 9%.
Warm and humid
weather here in New York
last week served
to_take the edge off of shopping and cut into
department store sales
with estimates
placed at even to 4% under that
of a year
ago.
In the wholesale
garment field
buying was reported strong as
retailers placed
reorders, many of which were at
increased, prices.
Food prices in the
week continued to
climb with meat in the van¬
guard of the advance.

According to the Federal Reserve
store sales in New York
City for the

.Aug. 9, 1947, sales

rose

Board's

index,

department

weekly period to Aug. 9, 1947,
period last year. This
compared with
preceding week. For the four weeks
ended
3% and for the
year to date 8%.

decreased 4% below the
a decrease of
3% in the

same

;

would,

active at firm to
the week ending

was

very

argely by the expectation that the
government,

volume was
large with consumer resistance to
high food
prices on the increase. Some
grocers reported that
discrimination
against high-priced meats

new

commitment, Lehman's pur¬
chase of 3,000 shares
increased an

(

slow and production

wools

Montgomery Ward
Loadings of revenue freight for the week
ended Aug.
only stock in distinct dis¬
9, 1947,
otaled 905,244 cars, the Association
of American Railroads
favor. What
announced.
percentage of sales This was a decrease of
16,347 cars, or 1.8% below the
was
caused by
preceding
profit-taking on week. This represented an increase
of 6,158
holdings purchased over the pre¬
cars, or 0.7% above the
corresponding week in 1946, and an increase of
vious few years
35,242 cars, or 4.1%
preceding distri¬ above the same week in
1945.
*
bution of the additional
stock, is
not ascertainable. It is
LECTRIC OUTPUT 11.3% AHEAD OF
interesting
A YEAR AGO
to note,
$■'however, that sales of this
The amount of electric
energy distributed by the electric
issue by Lehman Corporation and
light
and power
industry for the week ended Aug.
the State
16, 1947 was 4,923,000,Street Investment Corp. 000 kwh,
according to the Edison Electric Institute.
paralleled
This compares
purchases
by
these with 4,874,172,000 kwh in the
same trusts in the
preceding week and was 11.3% in ex¬
shares of Sears cess of the
4,422,242,000 kwh produced in the
Roebuck. State Street's addition
corresponding period
was

belt

;

rose in
sympathy with
high prices and most wheat futures

Montevideo

Woolworth.

The government estimate
on the wheat
crop indicated a
record
yield of 1,427,727,000 bushels. With
users well supplied for
the next
::ew
months, both domestic and export demand for
flour was
: imited.- Lard
very
prices continued to lose ground as the
result of
tion and
liquida¬
heavy hedge

ward

even higher prices/
"The Iron Age"
heavy melting steel scrap composite
price this week dropped $2.50 to a
figure of $3^.92 per gross ton.
his index is composed of
average heavy melting steel
scrap prices
delivered at
Pittsburgh, Chicago and Philadelphia, where the
average
declines were $3.50, $1.50 and
$2.50 respectively

from

made

areas.

companies

PRTrp

the

peaks.

Cotton

yet to be heard, "The Iron Age" states.

Other grains
new

was

During the past week Republic Steel
Corp., the country's third
largest steel producer, tied its pig iron prices to
and
"The Iron Age" No.
1 heavy
were
several smaller
melting steel scrap quotations at Cleveland and
individual
Buffalo re¬
spectively. Since scrap has been selling for more than
commitments.
the pig iron
it replaced. Republic officials
felt they could either
stop selling pig
Other Changes
iron or .add to its
price the additional cost of the metal it
replaced.
Selling which was outstanding
The soaring scrap market
which had steel producers worried
in the shares of motion
during the past month reversed its trend and
picture
fell even more this
week than it did last week
companies, - and particularly in
wiping out all the increases made
Paramount, during the preceding
during the past month and
materially increasing the flow of
quarter, had subsided in the June
scrap which was held in hopes of

portfolios, three

COMMODITY

Chicago Board of Trade was
featured by a
in corn as both the bash
article and futures
sold at
the highest prices on
record.
v '

"hands-off-prices" policy is

Tool, Van Norman Co.,
Wellman Engineering. There

four

rise of 24.3%.

sharp ris

the

buying by favoring fabricators
located near the
steelmaking centers; (3) the latest Federal Court
ruling (the cement industry case, Sept.
20, 1946) was directed against
the Federal Trade Commission
and upheld the
multiple basing point
method of selling cement.

Bliss, Food Machinery,
s-Bement-Pond, Sundstrand

stock

Trading

method from the steel consumer's
viewpoint,
at its best when steel demand is
abnormal;

Machine

While
eliminated this

spring wheat

f.o.b. mill basis which the Federal
Trade Commission would substitute would seriously dislocate steel

Babcock and Wil¬

;he previous
peak of 269.25 touched on March 18. earlier, and with
A year
index registered 225.75.
ago the
Grain prices continued to soar
during the past week Under
influence of extended heat
the
waves and lack of rain
in the corn
and

distribution

though it is not

cox, E. W.
Nile

period.

corresponding 1946 date,

Seagrams likewise found disfavor

% ABOVE 1946 WEEK

Food prices last week
again moved upward and the
Dun &
street wholesale food
Bradprice index registered a further
mild
;o $6.59 on
advance
Aug. 12, from $6.57 a week ago. This
compares with
for the
$530

Largely due to advancing grain
prices, the Dun &
daily wholesale commodity price index rose
Bradstreet
steadily last week
reach a new high level for
to
the postwar period.
The index
271.91 on Aug. 12. This
closed at
compared with 269.03 a week

advantage of recent price increases and wide publicity on
steel shortages.
Some observers believe arbitrary
basing points
and "phantom freight"
(charges for theoretical, though unused,
haulage) may not withstand the attack, the magazine states. But
the bulwark of steel
marketing, the multiple basing point system,

erages two trusts decreased hold¬

posed

trifle beclouded by charges of
combination,
fixing as the Federal Trade Commission

FOOD PRICE INDEX 24.3

GRAIN PRICES LIFT DAILY
WHOLESALE
INDEX TO NEW POSTWAR
HIGH

took

ings of Nehi Corp. and three dis¬

Schenley

was

and

Thursday, August 21,
1947

Volume 166

Number 2622

THE

COMMERCIAL

FINANCIAL

CHRONICLE

coal

Revived

other members of the United Na¬

production, eventually able'
to stand on their own feet and
fully
capable of repaying the

into

tions.

America providing Amer¬
will
accept
repayment
in

loans to

ica

goods

physical

the years to

the

ganization

deal

control

many

under

place

upon

;

hand,

General

use his great
prestige in Europe to help bring
togetner an integrated and co¬
ordinated civilian economic or¬

nomic

Cancer in Body-Politic
Western Europe

other

with

the

Western

the

for

themselves

stop

will have
the first effective step to
the spread of Communism
done,

west of the "iron curtain."

Improve

Germans the

re¬

Given

German

vicious

are

This contributes to

cycle.

The fundamental fact is that in

the years before the war coal was

supplied by boat from Great Brit¬
ain to the large ports of Europe.
Around these ports had grown up
the industrial areas of these vari-

eco¬

Ger¬

in bad repair.
the

Once that is

been

and sends back cars that

cars

family of nations of Western

made

policy that would

place

have

Europe.

Eisenhower shoulid

come.

build

from

Germany in cars that
repaired by the mili¬
tary governments keeps the good

Geimany Essential to Marshall Plan

(Continued from page 5)

(737)

Diet

policy, new organi¬
and new hope in Western
Germany, it is possible to begin to
a new

zation

countries.

our

used

in the

Coal that

immediate

was,

areas

not
was

25
want

Great Britain do not like or
that if they can help it.

Offering the miner added incen¬
tives to go to the 6-day

week and

produce extra coal during the
week would, of course, be con¬
to

Socialistic conception
But if the Socialists
continue to insist on an equality
of misery they are going to have
an increasing amount of misery.
Thirty million tons of coal ex¬
ported from Great Britain at cur¬
rent obtainable prices would al¬
trary to the
of

equality.

sent by short rail hauls to other most
cure the gap that now exists
opinion nothing can be
tion
industrial centers or was trans¬
of
use food not as a means of relief
between Britain's imports and ex¬
accomplished in either Germany
economic destiny.
by coal barges through ports. It would go a long way
but as an instrument and an in¬ ported
or
Western1 Europe
under the
rivers and canals.
At the same time, this coordi¬ centive to
toward curing the dollar shortage
get production going
Marshall Plan unless we in Amer¬
Not only was Great Britain in
nated pattern of organization is
that is now the crux of the crisis
again.
ica
announce
with the utmost
being developed in Western GerOn
an
average,
the German prewar days the largest supplier in Great Britain. With coal, Brit¬
clarity an entirely new policy for
of coal in Western Europe, but
many, its civilian economic coun¬ people' are
ain could buy a large portion of
living on a diet of
the revival of Germany which is
terpart should be in the process of 1,200 calories a day. That is one- coal was the basis of her diplo¬ her food and raw material re¬
at present the cancer in the bodydevelopment for Western Europe half of the diet of the people of matic power.
quirements.
politic of Western Europe.
as
The fact that Great Britain is
a
means of making sure that
Britain and one-third of the diet
Great Britain has the coal. She
That new policy must deal with
no longer exporting coal to West¬
the objectives under the Marshall of the
has the barges with which to haul
people in America.
It is
four aspects of the problem:
ern

sponsibility

for the administra¬
their own political and

Plan will be attained and that any

(1) Organization.

We must set appropriations made
by the Amer¬
up an organization to deal with
ican Congress to implement the
this problem just as we set up an Marshall Plan will not be
dissi¬
organization under General Eisen¬ pated or frittered
away in side¬
the

problem

the

SHAEF

and

hower

deal

with

invasion

line activities that have

(2) We must give new hope to
Germanv and Western Europe.

out
the

necessary objectives.,
In building this broader

organi¬

one

can

In
this report I have recom¬
mended that dietary experts work

bear¬

primary

heavy work and produce
diet of 1,200 calories.

vitally

the

diet and

and

of ing

Europe.

starvation

five-year plan
people

German

gradually from

Europe is one of the biggest
contributing factors to the dollar
shortage with which she is now
struggling—attempting
to
over¬
come
this problem by resorting

diet for

proceeding

1,300 calory diet

to 2,600 calories,

but with special

zation
for
Western
Europe he supplementary food incentive diets
specialized
(3) We must use food in order: should act in a civilian capacity for
groups
starting
to force the production of coal in for whatever time is required be¬ with the underground miners in
fore taking over his new duties the Ruhr.
I have recommended
both Great Britain and Germany
that under the Marshall Plan this
and use coal as a dynamic means as head of Columbia University.
Given such an organization, our basic five-year diet be guaranteed
to get industry going so that with
exports they can buy raw mate¬ new policy and directive from by the other nations, mainly the
rials and food.
Congress should require that we United States, on a declining basis
first
attack
the
psychological —100% the first year, 80% the
(4) Repayment.. We must pro¬
second year, 60%, 40% and 20%.
vide
in
advance
for
practical problem of Germany.
This can be done by the fol¬
By making it possible for the
means of repayment if we expect
lowing program,
each
part of Germans to
export,
they must
to be repaid.
which
presents
many
problems then rebuild their productive ca¬

Under

such

policy our
objective should be to pre¬
the restoration of military

first
vent

power

new

in Germany.

and difficulties but none of which

Philosophy

The

(1)

the

philos¬

Morgenthau

a plan that from
standpoint can
be

ophy in favor of
practical

general staff and
munitions plants and war mate¬
rials industries have already been
destroyed. Germany should never
army

be permitted

to have an army of

any kind.
Instead, there should
be a coordinated army of occu¬

pation for Western Germany pat¬
terned after the SHAEF organi¬
zation

built

General

hower for the invasion.

this

Eisen¬

After five

they wish to have more than 2,400
calories diet, they must produce

giving

Declare

an end

capital goods.

and

early end denazification except for
the 80,000 top Nazis in category
one.

(3) Permit the Germans to ex¬
port

hands

untying

quickly

shackles

that

and

now

feet

the
their

bind

the

form

regulations prohibiting barter and
the making of contracts

with for¬
eign firms; the provision by the
International

foreign
man

Bank

for

loans

with which Ger¬
industrial firms may buy raw
currency

materials
and

and

out

send

engineers

salesmen

secure

export

occupation business and by the wholesale
should be paid for by Germany.
elimination of the regulations re¬
Ultimately it should come under maining from Nazi autarchy and
years

army

the control of the United Nations

Organization

and

maintained

for 50 years.

part

army
be

the

basic

necessary for
able

the

materials
that would en¬

strategic
war.

Allies

times that the

raw

finished products
for

duties

peacetime

know

all

materials and

were

being used

purposes

and

ex¬

the

red

tape

and

bureaucracy of the German Landraths

the

of occupation there.should
inspection system covering

"Schachtism"
and

American

the
and

regulations of the
British
military

governments that prevent exports.
(4) Invite the Germans to take
part in the Marshall

sions

Plan discus¬

the needs of Germany.

(5) Proceed with the establishmenpof a central government for
Western Germany

building it out

of the Economic Councils

ports and not stockpiled for war.

organization designed to see that
the objectives of policy are ob¬

terned after the

that are

now

representative of the Ger¬
Once it is determined that we man states, providing for its ap¬
rnust have an entirely new policy proval at a later date by popular
for Western
Germany and West¬ election.
ern Europe, it will be necessary
(6) Abandon the Morgenthau
immediately to- visualize a new concept of a banking system pat¬

tained.

We should begin with Germany
as

the

System in

place

organization.

start

that

new

We should ask Gen¬

eral Eisenhower before

terminat¬

central

many
banks

Federal Reserve

America and institute
bank for Western Ger¬

patterned after the central
of the other countries of

Europe.
(7) Provide

for
a
central
balanced

new currency

Germany as soon as
as Chief of Staff to
government
with
a
Germany for a couple
budget is in effect, a central bank
of months to reinstate in Germany
functioning and sufficient con¬
the pattern of
integrated and co¬
sumer
goods available to give a
ordinated organization which was
new currency purchasing power.
so
successfully built under his
Once a policy along these lines
command* for
the
invasion
of
is announced, even though it may
Western Europe.
take months to carry out the pol¬
A Coordinated Occupation Policy icy, a revolutionary change in the
ing his office

return

export more.
a five-year period this de¬

For

(2) Bring to an immediate and

maintained for 50 years or more.

Germany's

for
hope is:

program

rations of

To do this, we must completely

abandon

to the repa¬

impossible of attainment.

are

many new

Abandon Morganthau

Ger¬

exports fast
enough to make up the difference
in this declining guarantee.
If
their

and

pacity

clining guarantee for food would
cost about $2 billions.
The first step in using food as

production
would be to bring over meats and
other special energy foods and put
them in the 75 colliery stores in
means

getting

austerity, Nationalism and So¬

cialism.
In

meantime

been' made

progress

Western

Ger¬

in the past year in the res¬
toration of the industrial produc¬

many

tion.

Municipal

power

plants that

supply thousands of small plants
have been operating at a small
percentage of capacity
shortage of coal.
A Moratorium

The fundamental
a

moratorium

due

dig the coal. The miners them¬

I am assured, would dig
the coal if they were given incen¬

selves,
tives.

one

Coal Exports
fact is that if

could

They

centives.

the

can

The

be given such in¬
real obstacle
theory of the

only

ideological

present
labor government that
places dependence upon Socializa¬
tion and nationalization,
rather
than the incentives that have al¬

induced men to work.

ways

The

productivity of the indus¬

tries of Great Britain is definitely

being held back,

in my .opinion,

by the fear and uncertainty of the

declared

to 15 months on the
shipment of these 10,000,000 tons

for

She has the miners with which

the

has

it.

year

nationalization

program.

Coal,

the manufacture of electric power,
and

transportation have now been
Sir Stafford Cripps

nationalized.

speech before Parliament on

said that more
is necessary rather
lutionary dynamic would be in¬
than less and that the government
serted into the whole picture of
would not give up its long-term
Western
Germany and Western
objectives because of the current
Europe.
If these 10,000,000 tons
crisis.
of coal now exported from Ger¬
of coal out of

Germany,

revo¬

could be used for a year or
within Germany, the
restoration of not only Germany
but of Western Europe could be

many

months

assured.

however, that
this moratorium on the export of
coal from Germany can take place
is for the countries of Western
The

only

way,

the British crisis,
socialization

An Added Loan to Great Britain

The fact remains, however, that
if America must supply an added
loan

Great

Britain

help

through the Marshall Plan in the
way of food and raw materials to
alleviate
Great
Britain's crisis,
then Britain's contribution to the

Marshall Plan and recovery of
Europe to be again supplied by
Western Europe should be to dig
give to the 170,000 under¬
coal from Great Britain.
and export coal and to postpone
ground miners of the Ruhr cou¬
The leaders of all factions in
further nationalization of industry
pons that would enable them to
Great Britain recognize that coal
until she can nationalize at her
get a 75% increase in the rations
is the very crux of their recovery
own expense
for themselves and their families
and not at the ex¬
problem.
in exchange for a 50% increase
pense of the American taxpayer.
Yet because the coal industry
When I went into Germany to
in coal production.
and
the coal miners have pre¬
The Ruhr miners are now pro¬
study the problem of German re¬
sented such a critical problem for
ducing 220,000 tons of coal a day.
covery, I expected that the answer
so
many
years, the leaders of would be found in Germany. But
Under
this
plan it is possible
Great
Britain are reluctant to
within 12 months to get them up
as my studies
developed, it be¬
face this issue. They are trying
to 330,000 tons per day.
came
amazingly clear that the
everything except offering direct crux of the recovery problem of
The annual production of the
incentives to get the miners to
Ruhr is going at the rate of 06,Germany and Western Europe lay
again dig the coal at the rate of in the digging and exporting of
000,000 tons. The new plan would
and in the quantities that they
coal by Great Britain.
provide an annual production by
It is also perfectly clear that
the end of 1948 of 99,000,000 tons. produced in the years before the
war.
But
America
cannot
continue • its
immediately such an in¬
This very reluctance of every¬
crease in production is promised,
UNRRA or relief loans to Europe.
one
to tell the miners and the
Yet we must
take prompt and
it is apparent that the transpor¬
tation system of Germany cannot country the real truth is at the vigorous
action to prevent the
bottom of Great Britain's diffi¬
haul it away from the mines. This
spread of Communism west of the
culties—not the whole problem of
is 'due
basically to the severe
"iron curtain." The only way to
course, but the basic problem.
do this is to help Western Europe
bombmg of the transportation sys¬
Under
normal
circumstances,
tem during the war.
and Great Britain to get industrial
the desire of the labor govern¬
production going and the standard
ment
to
make everyone share
Transportation Difficulties
of living rising.
equally in the austerity program
A
Without question in Germany
special report was written
is understandable and might even and in Great Britain perhaps, it
suggesting what might be done to
be laudable under certain condi¬
make greater use of the transpor¬
will be necessary to make addi¬
tation system of Germany to meet tions. But for two years the labor tional supplies of food necessary
the crisis that is bound to develop government of Great Britain has on a declining basis. But this food
in
Germany
this winter unless been avoiding the main issue of supply should be made available
something
drastic is done to the necessity of digging and ex¬

the Ruhr area.
Then

,.V

avoid it.
But

even

all these measures

threat is still there
transportation crisis
that may affect the economic sta¬
bility of Western Europe and the
are

taken, the

drastic

rest of the world.

Intensive study of
indicates
is that

that

are

this problem

real difficulty
attempting to ex¬

the

port 10,000,000 tons of coal from
Germany to Russia, France, Switz¬

only on condition that it be used
porting coal while using the pro¬ as an incentive to get production
ceeds of the American loan to buy
going and not merely for relief.
food supplies that could have been
It is my definite recommenda¬
bought in part, at least, with coal tion that the American Congress
had they gone to work to dig coal
stipulate some such plan as out¬
for export.
» lined in this report as a condition
for the appropriation of funds for
British Austerity vs. Production
the Marshall Plan.
The simple fact is that more and
France and the Program
more
austerity, while necessary,
now
only tends to push Great
The question has been raised as
Britain further down in a depres¬ to whether France will go along

psychology of the Germans will
sion cycle. Austerity cannot take with this
take
program. From my in¬
place and much of their erland, Holland, Italy, Belgium
in France covering
nated military organization of oc¬ hopelessness will disappear. The and other countries of Western the place of production. As long vestigation
cupation for the three Western German people will go to work Europe by an unnaturally long as Great Britain does not dig and both the leaders of labor, bank¬
again.
rail haul.
This ties up railway
ing and government, I believe
zones
bringing together the mili¬
export coal more loans are simply
Even though they know they equipment that is already griev¬
that France will cooperate protary
forces
0f
America, Great
.continuing Great Britain on the
-Britain and France to be supple¬ will be poor for two generations, ously short.
(Continued on page 26) ;
I American dole and the people of
Moreover, each country securing
mented later by additions from they will : go to work to try to
On

ouild

the

one

hand,

integrated

and

should

coordi¬

THE

(738)

COMMERCIAL

Revived Geimany Essential
To Maishall Plan
|

What

the

are

after

requirements of

France?

Western

First,

France

sured

that

aimed

Western

wants

the

Marshall

the

market

Plan

is
of

part, and not

a necessary

merely at the reconstruction of
Germany alone to the detriment
of France.
to

and

Hrcat

py an

economic

briefly.

rule

for

and the

you

Government activities

agreeable to

buyer, to

ly monopolies.

[either

that

the

loans
I;

and a half ago, when the
national
government took less than a
cent
from each dollar of income
("na¬
tional income"), most of the
ac¬
tivities which now make
up the

range of

choice,

freedom

the

market

taliation";you cannot scatter
y°ur

|an,be £epald of the loans "
£ S"6 "
Some

Bank.
made

?ther of his

tive.

satisfy

France

transfer of physical goods
oth®r countries to. America.

she

has

an
equal part with America
and Great Britain in its adminis-

tration.

The

Fourth, France wants to

industry and to
do this she must have long
range
assurance of a
supply of coke from
Ruhr

raine

iron

grated

exchange

the

veto

inte-

organization

Germany, this could be

topic.

these

violations

are

but

orderly, volunThey should
be

society.

quota of
10%

control

the

would,

while permitting
German operation of the
Ruhr,
prevent her from
strangling the

of France hold the
key
to the French situation.
My inves-

who

nf
of

civ
six

voted

generalized

imports, duty free,

having

now

million

grandsonsI

grandsons otJ o

.s'

different

from

If the free market

what

bave you se^ ^ ^or'

concept is to

comprehended, it must be

,iaf0
,
af"1
I viewed from both directions.
prohibitive tariff. Over a pe-1
The one side, previously menrid of years, such a moderate imservices nf nur complex
J
'
of
tioned> is the riSht of a Person to
portation would not 1
be destructive 'services ot our complex present-1.,
present
the product of his own
of
day economy.
either American
labor, with

pLnlpfSrpJnl

industry

repayment of these loans advanced
^
for reconstruction,

complex

the associated
right of its disposal
in whatever proper and
lawful

econ-

°^l?ArfUwi^r
people

exchange

produce

JfJ
sold

manner

The

choose

may

corollary of this is that

traded

this

fact.

transformation

takes

addition to

its

monopolistic,^

non-competitive

feature,

mental

usually

activity

free market

utner

"publicly

alter

offering us many inter¬
esting illustrations these days of

regulate

your

would bke

tt e s worK

not

Britain is

clear dis-

is a

monopoly

govern¬
.

violates

spect.

American

does

neighbor's flowerbed and selling it in a market
where he also sells wheat, at a

those

if,
ffi JZ, pJJ?

the

owned"

one

There

activity

by government, it

monopoly.

Having

Price

of!

?^de5
rpl^gs ™nich tney p eter

up to

protective

Frnn^mnnLL
Frenchmen now

ill inn

gov¬

probably move from the free
market into the controlled
market
of a non-competitive

how

such abuses.

that when any
over

will

place.

the;

early
sel1 m0,st

labor and over a long
I period of years, would permit the I

tigations show that this is not true,
Ont
Out

Today,

of the physical quantities of
production of any American

industry

industry of France.
1
Everyone has said that the Com¬

munists

plan to permit

new

steel

deal.

great

taken

be curbed in order to

H1
A second family of settlers finally arrived in that Michigan

monopoly of

scope of this
For present purposes, let it

be noted

outside the

one

convince you
that freedom of the market should

vest of betterment which it makes

walls

certain activ¬

interesting question,

therefore, let

possible for people.

Our Congress might consider

assured

the

power

complished

Lor-

Under

ore.

control

which

for

tariff

from

not

would go a long way to make postinction, from the standpoint of
sible the repayment of these loans, wilderness, then a
third
and,
So far, the program has not ac- finally, a large number of others, rights, between dumping your
wheat

build up her steel

the

reduction

part of

ity should be

plTn Outlined

will

report

competi¬
a

such

was 150 miles away
wilderness trails,
-

expendi¬

and

then

were

ernment is

order

and

•

private

They

Whether

crops; you cannot use

tary

investment'™

private

governmental

the free market.

outlawpd for mat reason
™
|ouuawea ior that reason, and not
ana not
What
they produced was their as abuses
bankers and repaid through the
of freedom of the marEurope would, I believe, meet the
own, to do with as they wished,
normal channels of
ket—which they are not, because
foreign trade
requirements of France.
Third, over future
They had to guard it, however, none 0f
years.
them arises as a part of
France must be assured that Gerfrom raids by wild and predatory
the exchange
process.
man
They
militarism will not be re- I
tbe bulk
.^e^e loans will men and beasts who knew not the not problems of the market are
vived
and,
The
in this have,to
b,e lepaid thro"gb the Golden Rule and the golden har"

der the Marshall Plan for Western

were

14 }° ?ir°W- at l°ur neighborA ?
t0 injure his person.
Acts

JiT

ox_cart

total

s field m order to
by contaminating an-

him

other rules of

century

tures

neighbor

ket, Detroit,

h
be

can

harm

wh=,f?£ev
self-sufficient.
What they
Produced was largely consumed
by them, because the nearest marcallY

™ori0

activities, how
any competition
from
enterprise?
A

allow

private

or-

in kind or in other forms

onn

required

most¬

separate

many

Does

that are its
My grandfathers family could
nob eaSily have beeime c,aMused

is and

are

Of all the

governmental

give

away, or to dump in the ocean.
Your rights of ownership give you

human

which

price

this

I firmly believe

basic

conduct, without
derly, voluntary

International Ban

un-1

simple rule.

one

n e

organization

II.

A,-

problem

But there
difference.

Some

Britain

in World War I and

War

can

Western Eurooe which I have outlined to bp followed bv an inteimea
De toiiowea

grated

I shall discuss them

any

to sell for

corn,

some

money

both

World

Second, France wants

Ampripa

destroyed.

The free market is founded

„

self-supporting

transfer

same

confronted

be taken into full partnership

wilh

these
the

Thursday, August"21, 1947

mean that you can
dispose of your
society cannot wheat as you wish, without
any
possibly continue to exist.
The limits whatsoever? No. You canproblem of repayment of rule is this: A person has a right not
dump it on your neighbor's
loans to America presents to the product of his own labor, flowerbed
as
a
nuisance of
re~

The

Ger-1

which

Europe

?ade for

[

by which freedom of the

processes

during which
would have a

years

chance to get on
basis.

as¬

reconstruction

Europe,

many

five

CHRONICLE

Perils to Fiee Market, National and International

^be^rep^id^^Repay___

FINANCIAL

(Continued from first page)

(Continued from page 25)
I as an incentive to get production,
we
understand her basic
^JL.
that they can
ment should not be expected until
requirements.

viding

other

the

free

market

another

re¬

Note the contrast between
governmental
activity and the

store.

You

found in

walk

into

a
grocery
the store,

observe the prices of the items
on
the shelves, go across the street
to
another store and observe what

they

have

and

what

prices,

and

appraise the contents of your
pocketbook; • them you
decide
which items to
buy from each

store;

you

pick

up your

purchases

and

pay your bill for what you
have bought.
This is the process
of the free market.

for a varietv of other things
11 person sha11 be allowed to violate
repayment
once
guesstlmated
Now go into the "store of gov¬
guesstimated ' thatind
that mdivid
that should be considered
this right- °ne shall not be alby the
|lowed to deprive another of the ernmental activities." The
uals in the United
American Congress is to make.
States, as an
opera.vprn{jp
Prm<.,irnP
nn1,r
product of his labor against his
in<y
nr
ion is quite different.
some of these loans for the recon- L
The store
? ' h f th
as a protest against current
will, in part or in whole, by any manager and his clerks allocate to
post- struction of Europe
through our
war economic conditions.
device whatsoever.
To allow one the
or more
is
people the items from its
Export-Import Bank and then
The Communist
lr, '
.
j
,
to do so would raucci out the
fnr
nthpr thim*<3 ILU
cancel
uu
so
wuuia
uui
me
Party in France accept payment in the
shelves, including cash, on the
years to Threcognizes that it has not the
mpancJ
tbat
mnrirpt
w
basic riSht of ownership, because uasis of their "needs," or
come
in the kind of
"rights,";
goods that
power to overthrow the
in
npnr
two conflicting rights cannot exist or special privilege, or friendly
govern- can be used
in our own relief
ment and is
qoo/
w
al the same time any more than acquaintance and political
following the Moscow programs thus
loyalty,
minimizing the
line of
erations
" two objects can occupy the same or whatnot.
waiting two or three years taxes levied
Their shelves are
internally to meet
for an economic
rpi.:^
puan«p
rp^uUpd
space
the same time.
One is stocked by
depression that relief requirements. In
sending bills to people,
effect this L
will play into their
mncvT mntpHni Lttprmpnt w a basic law of economics and the but not on
hands.
the basis of what each
would mean paying out American
it uas annarpntiv cnawnPfl
France therefore is not the main
',,„u other a basic law of physics. Both person gets off the shelves of the
credit now to bring relief to Westobstacle to the
PPnnnrnjr Wmfnsinn
Th*
r»f
are outside the-rights of man to store.
recovery of West- ern Europe and Great Britain and
Other bases are used.
ern
mi„Pfbjf,ati
h
' h
Europe. The main obstacle is later
ltH
violate, even legislative or bureau
In
accepting goods manufacthe
main, each person is
the ideological stand of a
in th
soil
f econornjP iinteracv
cratic man.
portion tured in Europe that could be
billed for the costs of government
of the labor
w
u
b p
i
,
+
thinir that
- This, quite briefly, describes the
government of Great used for relief work in
on the basis of how
the United
successful he
Britain that
rhanup fmm
«jplf <5nffipipnt
prevents the offer of States.
reason for the economic and social is in

Communist, there

Another

are

less than
750,000 real Communists,
The balance are Frenchmen
first,
who voted the Communist ticket

method

fvid

thpm«pivp?nrn

L ^of

othe^90%

Lnnrtanrp^Tnm

«!n

SLprio

wherl nlxchanae

economy to

nfwo,akVfiCHantlVeS t° and get full
6-day week thH mj"fen

to work a

production

that

will

qutte

exports of
economic tide.

enable

coal to

Another Five Years 01 American
Anotner i^ive Jtears of Amencan

dominates the

the

stop the forward march of
Th
Communism beyond the "iron cur- L

r^nort1 if ?eat B,r,itai!l dLgS a"d tain" rrnay reqpire another
outlined, she will years of

exports coal as
still need some

intelligent and

additional loans to

tive help from America.

buy supplementary food and raw
materials. In my
opinion, the peo-

help

in-

means

hus+

ex-

are

ain under the Marshall
Plan.
It is not in the basic

America

the world that
Great Britain should be
permitted
to fall or, under
excessive auster-

ity, to delay her

er?,'

economic

recov-

five-year

npil

Congress

the

opinion,
would

not

derelict in its

Kf»P

the

coal or that
other countries

Europe will fail

upon

interfering with this mechanism
Pf free and voluntary exchange;

no matter what his title may be;
matter whether a crown is on

airnlane

the

market

way of

m-conon

it.

Even if the
lion

dollars

cost

vear

s'pvoral

fo^thp

person

tLse

telligently made,
sonny made

not as relief but
not as relief but

to feed to

your

for later

this method

thing
the

amounts to the same

sending tax bills direct to
people, but it avoids the em¬
as

bal-

barrassment
these

he claims the

V1?1^a u1.n the exchange, the
fUl.nS h.'s ownership and the

chickens, to

buying

^—

———

did

The coat ot such

•

action
•

wUl|

recession

opinion, be greater in the

cist.of

preventingIt;
have

I do not know
whether we

our

endthanthe

I
^

the
.11

collective
x

intelligence

it,

or,

such

of
sending
people
objectionable
bills.
The
point is, briefly, that in the "store
of government" individuals do not

their

one

one
properly

This explanation has been more'
detailed than would be necessary

if I thought it was
generally un-'
der stood how the
growth of a gov¬

•

1*7that.we ill have a failure
eif ^ Weste.^,n R^r°Pe and
fail"re wlU. brin§

about

own

'Vt PporUDrotmse
it, nor propose

themselvcs-

n °r C
Perils to

I .shall

But

the

free

market.

Market

four
Two

them

national in character and the
other two are international.

(1) The Growth of Government,
as

Drain

Our Private Enter-

prise Economy—The most imnortant peril to the free

market, by

all odds, is the
overgrowth of our
government.

basic

func¬

preventing ' fraud,
predatory practices

lence,

monopolistic

abuses,

vio¬
and

involves

abandonment of the free market

Only i by

can

perils
of

its

process.

Free

mention

any rights

are

and the committees of Congress to
act with the utmost promptness
in developing a plan that can be
submitted to a special session of
Congress this fall.

tions

enough

recession.

btaamoditl'0
commodity,

the

will^ to act promptly
minimize

depression of severe
| nrnnn!ffr,miC not
proportions
only in Western

money

exactly like

that which the
people have earned
for use in their personal spending;

how

—

the scheme by which

manager

some

the

for the. invasion of I believe
that our only
hope of
western Europe, it is my opinion avoiding those
consequences
is
iltn
S hop®suwl11 hf rea- for the leaders of our government

live years in the
form ofMnans
believe that if
k>ans ore i'n

decorations

—■

...

billing; then the

Western

integrate

Cost to V

a row of

is.

expressing

is yours—to eat,' to store

France .and

to get together

see
clearly the essence a nlon of action,
plan
andIt*—TnT""i
n s problem and to act intel-|
If we fail to

ligently

right

use,

will tail
that England will

dig

of this nrnhlAm"
thk
problem
^

ernment, "beyond
t0 take actlon

American

'"y.,110.tbe American taxpayer
]t tailed to
it failed to
#>lpnrltr

and

gravity when

the

ods

mutually agreeable to them.
It
simply manufactures
prohibits another individual from for his use which is

his chest, or a majority of the
lots in his band; no matter,

wait hoping that America

any

terms

At times the people
object to
large bills under these meth¬

the

his head,

the

tive'of rMovervmP'l5h ** obieeecovery.
In.

sound

any two parties

contract

have to pay
directly for what they
"Sbt to dictate either the price or get off
the shelves; it is a proced¬
products of his own labor.
If you the terms of the exchange.
ure
quite distinct from the free
have that right, it means that the±Freedom of the market means market
process.
*
:
bushel of wheat
you have grown Ur®edom of action to the two indi

pro-

The

nrr *bat unless
is willing to dig and
s

did the law of
^pvplnnpri

Freedom

gram of this kind.

changed

merely another

inevitable question arises
to what Russia will do in the
face 0f sucb a constructive
plan
fer,„CC":trlbui10n to pf action for the reconstruction of
the recovery of
Western Europe
western Europe.
It is my conx.

r..Q,

not

between

market

process9

inevitably

under

has

It allows for voluntary

rhanfypd

the

what

ha«

performing

efficiently and in large
The billing is, in part,

volume.

etc.

1usj.

are

what

importance

bi„

What is freedom in the
market
And what is its importance?

followed and the desired reIt should have suf-

develop

+ndav

«nimH

wcrp

f Ed

making goods

services

Goltien Rule m universal applica- on the
basis of ownership of
prop¬
tion- It describes a voluntary coerty, or the exchange of property,
operaRve society which is the or
certain habits of consumption,
highest order of social attainment.

rnipc

ficient authority as to details so
that they can meet
changing requirements that will

Garden

ha«ip

R.,t

that

'ustice o{ the free market- 14 is
.the concept of the

kou"ded

neees-

What Constitutes Free Marketing

suits obtained.

interests

man

competent, capable of
that the basic
principles

seeing

help forthcoming for Great Brit-

organization,

but

+hp

-lrl

desijL

^ uei' B,rit?in about the yet0f,helpi.1g pe1ple t0 bdp.them-than
tav? H0t
been told the truth
selves—through an
small

rnlp«;

Karnp

five L th
construe-Lnnnfl
But this L,
th

should be made as
centive to production—as a

tent of the
austerity program renuired if there is no
additional

i.-.

U1.1;afd„nJ^gsoHPtv

has

scene,

rhancfpc;

"e|P

ade-

turn

one

ness

of our present

this

realizing

understand

the

serious¬

plight.

In 1946, the expenses of governmen in this
country took an aver¬
age

of 31

cents of each

individual
amount and

both

two
were

incomes.

alarming.
decades
taken

dollar of

The

large

the upward trend are

ago

out

recently

only
the

cents

dollar for

the expenses of government.

Number 2622

Volume 166

THE

COMMERCIAL

FINANCIAL

(739)

CHRONICLE

by this reasoning 1939.
Money in circulation, for Does that sound like the descrip¬ of reality, and if it is enforced, raising unbelievable havoc with
that the market in this coun¬ instance, has been diluted four tion of a free or of a controlled ;rade will stop and force produc¬ world trade and recovery. They
are a serious threat to the reestry is about one-third not free. times since then.
market?
Such a council, like the tion for sale to stop too.
The continuance of a free mar¬ administrative
But this is only a rough measure
The effects of exchange control tablishment of free world markets.
body of OPA, is
*
*
*
ket
is
and doubtless an understatement.
seriously endangered by not designed to spend all its time are exactly the same. By merely
an
unstable
We know that in a country with such
I have listed what seem to me
money.
The playing chess.
Their function is substituting a foreign currency for
complete Communism, where the danger comes in part from the re¬ intended to be the control of either the money or the wheat, to be the four principal perils to
It would seem

then,

luctance of people to engage in something.
;he rest of the story will remain
and grants them, in re¬ exchange if there is a threat that
So we study it further.
No na¬ the same. What happened in the
value
of
the
turn, whatever they see fit, there the
tion is to be allowed to engage in wheat illustration was that the
money
will
is no
market freedom, legally, change rapidly one way or the "exporting its unemployment" to money lost worth because of its
whatsoever.
That is the ultimate other.
other nations. Through this world counterfeit dilution.
Suppose in
More serious as a threat to free
of loss of market freedom which
organization, it shall be compelled this exchange question that the
o retard its production and carry
this country and Britain are ap¬ markets, however, is the damage
currency of one or two nations

government takes all of people's
incomes

proaching at an alarming rate. In
a
country where control is less
precise

complete,

than

measure¬

ment is difficult.
A
the

country where one-third of
people's income is taken by

done

the

the
then-existing
exchange process its share of
when misguided
individuals at¬ world unemployment, as an obli¬
tempt to control the effects of an gation under the Charter.
Think
unstable
oYie
over.
What
does
it
money.
That is how ;his
price control and other similar mean?
It amounts to someone

schemes

into being and de¬

come

government—is taken away from stroy the legality of the free
spending in the free market—may ket.

mar¬

with

conceal

the

idea of control

The

its

same

1.
as

reason.

worth

true

its

with

line

of control sitting in
on matters of produc¬

market

Drain

our

value.

International

Commodity

Controls.

Exchange Rates.

4. Control of

nature of these

If the

result, legitimate trade will

they are:

Government,
Private Enter¬

Growth of

The

and inter¬

summary,

prise Economy.
2. An Unstable Money System.

is to attempt

reduced

national.

fixing its exchange value out of

power

judgment

worth for

.oses

markets, national

free

perils do

become known
through education, so that sound
action will follow, future histori-

not

be shut off between the two coun¬

promptly

ians

economic

write of the

may

that was
We are now under the spell of once America, just as they have
prices continue to rise, with :ng nations.
have lost more than one-third of
It is like a factory
further rises in wage rates and as that is working full time while worldwide attempts to conceal the written of the past glories of other
its market freedom.
This is be¬
tion and

price for the participat-

marvels

tries.

and

progress

cause

people

try

for

dollars

"saved"

inefficient competitor, work¬ true degree of worthlessness of
ing only half-time, suffers partial many national currencies.
The
method
of meeting
and de¬ unemployment; the more efficient control
the
mands for all sorts of government producer would not be allowed to situation might be called an "in¬
for instance, pass comprehensive
controls may be expected to in¬ continue
to
"export his unem¬ ternational currency OPA."
Just
price-control laws, thus making
crease.
There will then be an ployment" to the market; he would as
under our OPA the results
every marketable item in the na¬
tion unfree and do so at only a important test of whether even be compelled to reduce his opera¬ were called a "meat shortage,"
nominal expense for passing the the essence of the free market is tions to that of his less able com¬ etc., under the exchange control
to be preserved.
The only effec¬ petitor. Does that describe a free schemes the results are called
law.
It
is
generally believed that tive way to meet the issue is to or a controlled market? Is it de¬ "dollar shortage," etc.
These currency controls are
•practically all controls have been first have a correct diagnosis of scriptive of our traditional system

government
expenditures
control may not parallel the
degree of control. A country may,

end

this

abandoned
the

the

country

since

But

war.

they

not.
Direct and indirect
still operate over many

have
'

the

cries

the sterile
during the war,

spend

what causes

the trouble in order

to be able to avoid suffering from
the wrong treatment.
*

controls

■

Note,

government

for

figure

of the many illus¬
creation, under

one

the

trations,

expense.

governmental encouragement and
support,
of
monopoly
controls
/over
the laboring man by much
of "organized labor."
Note also
the present controls over trans¬
portation
rates
and
operating
costs, in an industry nominally in
private hands. Many others could
•

mar¬

Time

ket

which

mentioned

been

have

further

be listed.

allow

not

"national"

Most other nations suffer

perils.

plan;

without

it.

world.

Market

Then there are two important
types of "international" perils.

notions

that

strange

nation,

this

perhaps the world leader in
economy, however much
battered, should take leadership

still
a

free

ized.

records
with.

Their

were

private

exchange

the

are

-The

goods

money,

want, just
rather

not

the

people
really
it is the electricity

the

electric

wires

they want.

works

If the
of

well

conveyor

electricity

fered

with

it will
In

the

faulty conveyors.
is faulty, the flow

free markets

appears

nations,"

should say almost completely.

component

relief

the poorer
international

"orderly

trade," "allocation of limited sup¬

plies,"
dollar

one

for
"international
war¬
time relief," "reconstruction aids,"

stop the flow completely.
exchange,

the international

plans

tween

level marches under many labels.

of goods, is inter¬

case

mistake after iJ

into long pants.
The program for elimination ol

and, if faulty enough,

is still

has grown

"permanent

Neither transmittal process

mistake

money.

what
as

than

which

belt

exchange,

re-

The

is conducted

process

transmittal

many

similar.

"settlement of debts be¬
nations," "meeting the
shortage," and

many

others.

The entering wedge for contm
in

world

markets

appears

harm¬

less

people lose all confidence in the
money, they can exchange goods
only by the awkward device of

enough to those not discern¬
ing in such matters.
In a blue¬
country,

But

once

forced

international planning is

to,

agreed

controls

thereby

are

all participating nations

in the same manner as OPA was

imposed

every

person

down

the road.

the free
traditional system
voluntary, competitive econ¬

Where would that leave

market and our
of

will

never

the

(4) Control of Exchange Rates—
Lastly, I wish to mention briefly
the control of exchange rates be¬
tween currencies.
It operates ;n
international

trade,

both of national
ternational

result

policy and of in¬

agreements.

The idea of controlling

exchange

many

papers

corresponding

committee

the

taxing

power

in its

channels, and to the per¬
of its proper functions.
It was clear we would have to
know for ourselves the real facts
about conditions in Europe. The
information the people and the
proper

formance

Congress have been given piece¬
meal has been murkey, contradic¬
tory, incomplete.

It has been filled

based on the same eco¬
with vacuums which are too ob¬
fallacy
that argues for
viously created by deliberate con¬
-barter.
Barter is a free market
provide that the nations agreeing price control of commodities with¬ cealments for us to ignore them.
operation, but it could not sus- to the plan shall solve their eco¬ in a nation.
It is precisely the
Therefore, we have two commit¬
tain a very large portion of the
nomic
problems by neighborly same basic idea, though this one tees of the House going to Eu¬
exchange of goods and services in collaboration.
It
provides thai; is a little more obscure to our
rope to determine the facts for us.
: an
advanced economy.
For this fences hindering greater welfare view.
Those committees will find out
We are familiar with the way
reason, one may say that loss of through exchange are to be re¬
the
real conditions. They
will
the money aid to exchange would duced, trade is to be set free, and commodity price control works,
talk first-hand with the responsi¬
eliminate most free market tradSuppose
discriminatory practices of favor and its tragic effects.
ble spokesmen of other nations
big in our economy.
that the price of wheat in a free
between nations are to be abhorec
and will determine what we can
That
We all know that our money has and later forbidden. As fruits of market is $1 a bushel.
count on in the way of efforts
become highly unstable.
I men¬ the plan in action, there is prom¬ means that the consensus of opin¬
by those nations to help them¬
tion i it here merely to list its in- ised
great increases in welfare, ion reports (1) $1 and (2) 60 selves. Every American wants his
stability as one of the greatest full employment and peace.
pounds of wheat, to be of equal
nation to do its part to help re¬
perils to the free market, with
Suppose that the
These are the stated objectives. worth in trade.
store peace and sanity throughout
only brief evidence of its degree
currency
becomes
diluted
by the
They sound enticing and remind
world, but we must not bank¬
of instability.
pouring into the exchange system
one of some of the internal rules
rupt ourselves, wreck our own
If you had sold commodities at
of economic conduct by means of counterfeit or worthless dollars,
economy.
wholesale in 1939 and put the dol¬ which this nation acquired
its until the consensus of opinion
No
man
ever
saved another
lar received therefrom into
fixes $1 as worth only 30 pounds
your greatness.
It is only when look¬
from
drowning by going down
sock, and if you were to take the
If the government, "to
ing behind the mask of these gen¬ of wheat.
with him.
dollar out now and buy back the eral
objectives, into the stated or stop inflation," steps in with a law
So these three vitally important
same
tynes of commodities, you implied aspects of the plan, that that prohibits wheat prices from
lines of inquiry are going for¬
would find that you had been one can
rising above the former level of
fairly appraise it.
ward concurrently. We are sure
short-changed in the process by
It is proposed that an interna¬ $1,
legitimate trade will be
the
second session of the 80th
nearly half.
Even that does not tional council table be set up to stopped, as was so well illustrated
Congress will have first-hand in¬
fully reflect the dilution of our solve such
problems as the allo¬ by meat and other products under
formation upon which we can
money that has occurred since cation of surpluses and deficits. OPA. If law thus flies in the face
'

•

plan, drawn
up
in this
the "general , purposes"

rates

nomic

passing I want for a moment
to
something. A few

advert

when

ago
committee

years

it
it

congressional

secret" inspection
when hard worked,
members of the Congress

Today

tired

continue
their
in session

willing

are

labors and sit

arduous

"top

was

tour.

points where vital informatio i
most easily to be gotten, our

opponents and those who woul I
destroy the faith of the America i
people in their Congress call these
trips junkets. Let me say to you
if anybody believes a five- or six •
weeks' inspection trip to any part
of Europe or the Far East with
the bad water, worse food, rubble,
desolation and desperate peop "es
constitute

joyful

junket

ought to try it once.

job of saving the world an \
same
time
of keeping

This
at

the

America
is

sound and solvei t
for the fullest co¬

free,

calling

one

operation
and

creeds

between
parties.

all
If

races,

America

down we all lose. If our free
Constitutional system of govern ¬

goes

economy and society
wrecked and ruined, we all

ment,

are

lose.
If our liberties are destroyed, if
our freedoms are abolished, if ou •
American way of life is warpe l
out of form, we all lose. If our

working condi¬
traditions are
lose. The onlv
people who believe they might
gain something by such a catas¬

living levels, our

tions, our social
destroyed, we all

the subversionists —
overthrow our
form
of
government, our free
economy and our free society in
order to loot us. I care not by

trophe
those

are

who

would

call them, whether
just plain
they menace our wa~'

President went on

journey at the public expense
was "an inspection tour." Als )

the

lay down proper, just,
scientific rules and regulations to
Senate

confine

omy?

be told because

and records have
been impounded.
So a special committee is work¬
ing with the Ways and Means
Committee of the House and the
of

capacity to pay.

needs and the

were

businesses

Their

pounded.
ihterfered

penal¬
im¬

themselves

found

Their

current.

be aban¬

not

proper

•

specks the two

will

intelligent

base

„

even

doned.

rights were invaded and flaunted
opinion, the essence of a
(3)
International
Commodity
in a plan having as its essentia1 by Federal agents, and they were
voluntary society, of private en¬ Controls—Most people think that
without recourse. We were under
terprise and free markets, cannot the idea of controlled prices, with features various forms of contro
a
government by administrative
long be preserved if the economy which we had such vivid wartime of the markets of its participating
It is easy to see why regulations numbering more than
of the
nation does not rapidly experience, has been effectively members.
thousand. Many of
other nations, with opposite ide¬ seventy-six
abandon a sizable part of its pres- buried—with
a
few
exceptions
denied
the
citizens
the
ologies from ours, should favor it. them
ent burden of government.
like rents and sugar.
More accu¬
But why the United States?
right of judicial review or redress.
rately, I believe, the idea still
National planning, it should be We do not want regimentation of
(2) An Unstable Money System
strongly persists although it seems
people or professions.
—A thoroughly free market, as wc to have moved into prominence in noted, does not force international
Social theories were promoted
planning on other nations. While
know it, is not likely to be pre- the
international sphere.
Some
one
nation chooses to go
com¬
by the taxing power, and favorit¬
served if money is highly unstable. might say that the idea of controls
ism was rampant. It is probable
Money is as essential to an ex- has merely "grown up," which I pletely totalitarian, another may
the whole story of that dreadful
change economy as is the conduct¬ would accept as a description o:: pursue economic liberalism as this
nation did during the last century. chapter in our American history
ing wire for the transmittal of the situation, remembering that a

; electric

understood

•

understanding
confident that if it is

ket

the free mar¬

Let's not abandon

(Continued from page 10)

the

you can

International Perils to Free

In my

social justice.

and

analysis of this
do it for yourself— tern has been growing as a jerryalways having in mind as your built structure erected to serve
test of its wisdom the character¬ political expediencies. The taxing
into

understanding

foreign policies;
extraction from the gov¬
ernmental anatomy of useless, ex ¬
the same perils in even greater
degree than we do.
But these are istics of a free market, as I have power was prostituted time and pensive, wasteful, tax-absorbing
bureaus and commissions; and se t
national perils in the sense that attempted to set them forth.
You again in the most flagrant and in¬
defensible
manner
to
punitive up a taxing system which wi 1
each
nation can,
if it chooses, will then see why I list such
schemes
as
an
avoid them.
important peril uses. Men and businesses who did scientifically and equitably assess
the New Deal taxes on the basis of real Federal
to free markets throughout the not agree with
considered

may

does

functioning of the free
market and its result in economic
the

What of America's Future?

economies of other nations?

•

,'The two perils to the free

At the

re-education

brought

which

country,

such phenomenal progress, or is it
reminiscent
of
the
controlled

parts of the economy which are
not-fully reflected in this 31%

this

civilizations.
heart of the problem of

famous

"inflation"

yv-hat name you

Communists, Fascists or

agitators —
of life and they must be

defeated

cast out. The Constitutio i
must stand. The Bill of Right?
and

must endure.
of

Our American way

life must be

perpetuated. Thn

youth of this land, the young
veterans—all must have their fai *
chance for a full, happy and con¬
structive life as did their fathei >

cooperation we
division, we
fail. We must not fail. We
not fail. America will stand.

before
can
can

will

them.

assure

that. By

(740)

THE

COMMERCIAL

at any rate,

due to the selfishness of
business (except labor, of course, and for the most
part
except the farmer, also) another 1920 or perhaps another
1929

or,

not

can

that nowhere in

assert

aaiiy
daily at some point ux
puxnt or

need to cite

The point we

public to have forgotten.

•

President.

But this particular

phase of the situation

stubbornly refused

•

gree

which he

usually
The

able to

fairly good

President and

will doubtless

"cause."

impress

measure of his

his

advisers

their

serve

adept in finding

simply

ability

the

cally,

need of
any

more and more—indeed

have gotten to the
point where at least
threatened

with

the

the tradesmen have
not been
are

of the

necessity of returning

fairly closely approaching their
prices

some

everywhere,

going higher.

ceilings,
ject to

priorities

tbere
kets

room

because

What

carefully
about the

something

living! And

laggard in warning her that

Excellent Issue

issue for the politician who
for the 1948 general election!

in the butcher

main

the

It is

never

building
Everyone knows

difficult

prices
really high^-regardless of the
cause—and
moving
ward, as they are doing now. It
appears

metal

Jha.ng.e

without
?

some

course

that which

reference

never

war

up¬

living is high,

will
om

prices

metals

mean

nies

and for banks.
these advantages will

But

all

in-

fu-

York and

the leading
It has re¬

the

what

all

from

After

this
to

commodities
side
be

series of quick
moves
late in

New

Commodity Exchange,

York

Trading
resumed

in
on

few

lead
this

Advantages
There

weeks

futures
same

ago.
will be

Exchange

whether it will be ef¬

gullability of the general

the

metals

made effective
by resumption
futures trading in
copper and

zinc

re-con¬

climaxed

and
of

deep-

1946,

to free
trading in
in the United States
was

pass

the

free markets.

return

may

of New York

the

will

futures

can

buy

realize

market

his

rises, he

makes

be¬

exchange

lower

mar-

pays for protection

against other¬
The importance of futures
trad¬ wise
uninsured inventory loss.
ing in the metals field can
hardly
In
that

This

metal

well

due

effect, a dealer who uses such
hedge protection declares that he

tfc

smelting and

many

will

be satisfied with his normal
legitimate profit and that he fore*

pro¬

cessing operations, usually require
relatively long periods of time

Many of
this

involve

goes

since

the

start

fact

Already

trade

and

tection

markets

of
are

them.
be

basic difference

time

eager to take
the market. That is

nature,

but

represent

course

genuine

true

port

hedging

policy

in the metals field is best
the

1946 annual re¬

American

of New York.

report

that

Metal

Co.

summarizing the
1946 billings of the
company, the
statesl

the

total

in¬

cluded:

(1)

refined
a

metals handled on
commission basis,
,
'r ' ,

(2) refined
for

(3)

metals

resale, and

purchased
•>

•

metals
raw

Then

purchased
in;' the
material for treatment.

the

report

continues

'(and

prices arrived at
by free and open
.

against
they may

even

illustrated in the

bids and offers from
every part of
the world.

in¬
pro¬

fearful

are

will

the

not

How

continuous mar¬
ket where
positions can be taker

Thus there is

change

tra¬

immediately,

hedge

they

trade

use

market

Half

works

These two functions
are: to pro¬
vide facilities for
price protection
and to provide a

liquidated

temptation

hedging policy.

ditional importance.

and

only

willing

does

the

regaining their

The

numerous

the

human

industry

that the two
major
metals futures

means

functions

that

are

opportunity of specula¬

dustry members

the

will not last forever.

profits.;.

seek,,larger profits is, of course,
strong and that accounts for the

may have forgotter
of the acute metal

because

the

tive

considerable

quote): "With respect to the last
category—the
purchase
of
raw

materials

general

only

for

smelting
i0

the

policy to rely iforrprofit
the- treatment' chafges and

between futures
trading today in to resell the metals 'for future
agricultural crops and in nondelivery, when feasible,r. immediferrous metals.
They all serve ately
upon
intakev such
sales
the major
purpose of bridging the USUALLY
RESULTING IN NO
time gap that
usually exists be- MARKET PROFIT."
^

tween

the

production

and

con-

be no doubt that
That is no textbook sfat'efrient,
tre¬ sumption
course, but the current
of
basic
mendous economic
commodities but the
analysis of the situation which
brings these high re¬ result from New advantages will and by eliminating the price haz- 0f our considered policy of one
tail prices into
York's role as ards
leading metal companies,
existence is as
faulty as the reasoning which the leading international metals such inherent in the marketing of
Jed so many of the
materials.
That, of course, is
Situations for Use of Hedges
trading center. Npt only does this
wiseacres to say and to
reiterate almost mean
hedging. The principal of
without end that the
broader markets and
hedging
All
through the metals field
im¬ is the same in all
"bust"-which must follow the
markets.
It is there are1
"boom" proved marketing conditions for the
situations' which lend
was/ upon us.
proper use of futures markets
our own metal
themselves to the use of hedge
producing and.con-? in order
amongi the wage earners
t6Teliminate, or at least
suming industries, but it will atprotection-, "against " unforeseen
reduce, price risks existing in
cash'price changes.

official

can

Monopoly—-except

They

n r

can

price

lasting only if we succeed
building up and maintaining
higher price than he sold them.
and smoothly
functioning
This surrender of extra inven¬
metals futures markets in
New
tory gains is the price the dealer
York.

exaggerated.

broad

ap¬

after-

profit on
his
inventory, but this is offset
by a loss in the futures market
because he is compelled to
buy
back his exchange contracts at a

and

come

problem

time

On the other hand, if the

shortages

him.

receive a lower price
had anticipated. But at

he
same

ket

compa

accrue

course

back at
than he sold them.

cus-

refiners; it will
business for steamship

companies, for insurance

happen

contracts

smelters and

Ex¬

price

cause

This

outstanding

drop before he
sell his physical
zinc, he will

the

trade.

stock,

equivalent

normally spot and futures
in
harmony, here is

will

than

larger share of the

his

move

added business for

mean

members

soon.

upon the

ccls^

tract to

interests

appears
rooted distrust of

the plan

day

and,

trading

with

Supplementing
lets

Since
—

the

shift

proached

country where such abundance
exists side by side with
such
"outrageous" prices
or

As soon

Government

are

to the sad state
of affairs in

The effectiveness of
all this,
fective at all, will
depend

"NT*

probably,

dispose

give
the

amount

exploring the possi¬
about be¬ bilities for protection against fu¬
cause of
many changed conditions ture unforeseen price
fluctuations
in the postwar
world, but largely and are stressing again the need
because no time was
for
a
lost, here in
continuance
and
reliable
NeW YPrk, in
returning to free barometer that makes possible the
trading in the metals as soon as evaluation of future
price trends
the war
emergency was over.
In
Functions of Futures Market
England, on the other hand, the
British
Labor
This

version

this tactic is of

and

resold

market!

The change has

has been directed

of violation of the
anti-trust laws.

contracts.

war which made
price a secondary
possibly may be
international political consideration—but we all know
that the sellers' market
in metals
strategic significance.
Cer¬

goes,

secon<ia^y aiiimiriiAm.
New York
today is

business
United States.

excellent bit

culprit who

ahead

profit

international

Commodity
Ex- the fact
is now redoubling-its ef- refining,

Atlantic

most

commodity before
maturity of the futures

page

is also studying the
feasibility of and hence
inaugurating futures trading 1 in
price; risks.

strategy to make political
capital out of the
And the
campaign for that purpose has
been launched. The

charged with something,

re-

hands

trading also,

the

state of affairs.

enough

time

physical

prove

imports

Meanwhile,

and

Attorney General
"investigate"—that is to find some

mar-

function

can

tainly, it is of vital importance

convince him that
"there is something rotten in
the State of Denmark"
as
to all this. Either
the
manufacturer, the processor, the
wholesaler, or the retailer must be
"gouging" him—or
at least he
usually is quite ready to listen to such
a
story.
He is the more
ready to listen to it when

of political

for futures

these

sxchLg^wnrreesteblisTto
tu.res

matter

prices in the local grocery store and

very

allocations,

government

white

This

shop. Most of them are aware of what is
asked for the
things they must have from time to
time in
other stores. Those
prices always look high to the con¬

sumer.

long

placed London in that role!

course ot

and

futurese|oToPng0as°an

world metals

fixed under government
and distribution is sub¬

people;are fuluresmarke? "Z

prewar scale of

delivery in

far

what

are

duty of dustry at a fixed pric^

of meat, and of a great
many other of the
necessaries, have for a good while past

burdening the family budget

spectacular

(Continued from

price index" has

sort of index to tell her
that the prices

been

are

politician, only under free market conditions.
theirs, which That is the reason why there can

rising. Of course, the housewife, who has
keeping the family larder filled, has not had the

month

Trading in Metal Futures

being at all
living. What has

been

insure

himself

can

purpose for the time

events.
It is our old
friend, the cost of
of late been
rechristened the "consumers'

suits

as a

have found

there

can

the public with it

anti-trust

affords him
himself sub¬

change contracts.

But

might

against this risk.
As
he buys the 300
tons of
zinc, he offsets his price risk
by
selling 10 contracts on the
Ex¬
change.
He sells these
contracts
on the
Exchange for
soon

other.

maybe, better politics.

the

heavy losses

stantially

about

and the de-1

one,

with

the

must have

He is

him

assume

As he sells the zinc
from his
he
buys
back

prides

politician

stock,

price decline that

facilities

be found in the

are

his

immediately

burden

circumstances

hedging

that

he buys 300
tons
these

the market goes
against him.
The futures market

to the

money

vocalists—and what

not do without one.

causes

would

course

if he
feels

too high.

in the hands of the rank and
file—but it was not.
Here
are
the real explanations.
The latter is amenable to
gradual correction. Nothing much can be done

they have said has made but little
impression. Perhaps,
the best course of action now
is to forget it all as
"just
one of those
things."
But the

brief, the

are

under

risk of

strongly fortified by the methods
financing that war. No such war could be fought
successfully without reduction in the production of many
types of things the consumer wants, and, in conse¬
quence, accumulation of "wants" and "needs." It
might
have been fought with less of an
accumulation of

honor the predictions of
the pundits and the
soothsayers in and around Washing¬
ton that it has become
very difficult to maintain
any
such position as had been
taken by them. For some
time we have heard little from
these

the

to the

even

say

Without

politi¬
surrounding the

politicians

zinc

of course, have been

or at the very least to be in the
process of
passing. The volume of business
activity, the amount of
employment, the rate of wages being paid, and all the

rest

the

prices, or
pries

Let

used in

appears to

have passed,

example

operates^ in

mmvt

current

almost inevitable consequences of
large scale war, and,

the current trends of busi¬

particularly profitable

cian—particularly to

ness have
got too much under the influence of some of the
persuasive present day heretics and the devotees of
planned

•

p0Si.

A metals

may be uncertain

are

would not be

causes

dishearteningly large proportion of those

who observe and comment
upon

typical

(how ^hedging
metals field.

correspondingly little real reason why it
should be widely indulged in now. The real reasons are
to be sought elsewhere, and a careful
ferretting of these

number of months lent
considerable support to those of the
political policy makers—even if the
reasoning by which they
reached their conclusions was less naive.
We suspect that
the

economy.

The

inventories

backlogs,

Here

time—and

employ of government were unduly impressed
by the economist-politician, br not, but their edicts for a

chronic state.

orfjer

making here is that it is not in the
least necessary to posit any such restraint of trade to
explain the high and rising tendency of prices at this

would be difficult to know whether the
professional econo¬
mists in the

thinking of

It ~
is

other.

c°™™toents

urcbases> existing

proof of such statements,

the short-memoried

even

has

economy

•

make invidious mention of names in
connection therewith.
No one will need
any evidence. It all happened too recently

for

Naturally, IcommodUy

causes.
vast

The Real Causes

No Proof Needed
no

the

our

terpretations placed by the courts upon these statutes change
dealer r*
quires
an
avaiiable
so
stock
*
constantly that, if the truth be told, not even the pro- prompt
deliveries in order
to con
verbial Philadelphia lawyer can be sure what is and what duct
his business.
He is
I nnmr\ol 1 orl fn Kuv
therefor,
is not a violation.
compelled to buy, even
though he

less the politicians
the situation.

There is

Thursday, August 21,
1947

definitely in the cards for the near future un¬
stepped in without any delay to cure

was

CHRONICLE

there been any breach of the statutes
loosely known as the
anti-trust laws. The probability is that such violations occur

(Continued from first page)
wages,

FINANCIAL

of the nation, of course—is not among

As We See It
low

be clas

THE

Number 2622

166

Volume

the following five
of metal hedges:
The smelter's hedge

types

■The refiner's

mechanism

The

producer's hedge

either

briefly outline these to

production well ahead
It then has the choice

buying back

Smelting

operations usually re¬
60 to 90 days. Where

hedge.

the

proc¬

maturity.

fronted

time

from

must

the
machinery
change market.

their

reasonably broad.

trading

means

volume

That

the

and

Our

Reporter

By JOHN T. CHIPPENDALE, JR.

ex-

a short-term low-coupon issue, and that was exactly what was received. ... In offering a 10 months %% certificate in place of the
Sept. 1 maturity and a 12V2 months 1% note to refund the 1 V\ %
and 1%% notes due Sept. 15, the monetary authorities have defi| nitely broken the wartime pattern of interest rates.
The rise in
.

sb°rt-term rates is now an actuality with the unoegging of the
cer}]1
rate. , , . A 10 months 7/q% obligation is just a shade
under
on a year*y basis. . . .
.
;

futures on
Commodity Exchange, Inc. was
resumed July 15. Since that time
copper transactions have totaled
only about 250 contracts, and the
open
interest at the moment is
Trading

Governments

Thetierms of the September refunding operation by the Treasury
was no surprise to the financial district, which had been expecting

changed conditions.
It is then
usually found that the machinery
of
producer
price
adjustments
does not function as rapidly
as

hedging funclons adequately, futures markets

protect himself against

time

does

fulfill

vary

stable is bound to find itself con¬

Volume of Futures Trading

custom

(741)

day

to day, whereas pro¬
prices often do not change
over a rather long period of time.
Producers aim at price stability.
However, the efforts to hold prices

outstanding futures contracts

quire from

quotations

CHRONICLE

ducers'

its production against

from

at time of their

smelters bring in foreign
ores, the time between ore pur¬
chases and metal sales is even
longer.
During this period the

from

FINANCIAL

futures

Metal

the

use

delivering actual metal

essed

the

smelter can

may

these fu¬
tures contracts as its production
is sold through trade channels or

y°First,

smelter's

its

delivery.

dealer's hedge

The

miners,

of the futures market

in the form of contracts for future

hedge

processor's hedge

Let me

sell

The

of its

ment

major

sified in

COMMERCIAL

copper

PREMATURE
The issue of non-marketable restricted 2%% bonds that will be
tracts must be large enough so
offered to non-bank investors and commercial banks with savings
that
a
hedge can be "lifted"—
still only about 100 contracts. The
deposits late next month was not expected at such an early date.
.
.
without causing undue price fluctrue significance of the copper re- It is still too soon to indicate to what extent commercial banks with
uations in the futures marketopening can not be measured in savings deposits will go for such an issue. . . . Until the terms of
when the corresponding cash com¬
terms of these figures alone.
Re- the offering and maturity dates are known these institutions will
be obtained in the futures market modity position has been closed
sumption of futures trading re- | express no opinion on the new offering. ...
1 '
when
the contracts,
previously out.
••
There has been, nevertheless, a definite distaste for a nonstored a sensitive price barometer
That is why the Commodity Ex¬
sold short, are bought back.
marketable obligation, but this
for

by the immediate
sale of futures contracts on the
Exchange. Then should the sale
of blister copper,
for instance,
bring a lower price than antici¬
pated, an offsetting profit would
a

drop

price

amount of

total outstanding con¬

The change is directing its efforts to¬
much the ward the broadening of its metals
same as that of the custom smel¬
futures markets. The first objecter.
He can use the sale of fu¬
ive to shoot at is the Exchange's
tures as p hedge against a spot prewar volume of metals trading
but I firmly believe that this
price decline.
In his case, however, a reverse will be only a beginning.
Next is the refiner's hedge.

refiner's

case

very

A re¬
finer might
commit himself to
deliver refined metal at a speci¬
could also arise.

situation

fied price, before his raw material
needs are covered for such a con¬
due

was

its

fulfill
It

will,

time

purposes.

before

course, take some
the metals futures

his stocks.
futures

ventories

protected by

can

sale of future contracts;

In¬

periods of uncertain busi¬
prospects, the protection of
against sudden price
declines is, of course, most valu¬
In

ness

inventories

would

inventories

Where
a

sudden

price

are

drop

at least be partially offse

profit

action—when

the futures trans¬
short
sale is

the

liquidated below the selling price
The dealer's hedge has already
been * described.
The
need
for

dealer's

protection is particularly
acute when the dealer also is an
importer.
In normal times this
applies principally to tin, because
all our tin requirements must be
imported. Where a dealer or im¬
porter does not immediately

offse

purchase abroad with a sale at
home which nets him his cus¬

tomary profit, he can operate safe¬
ly? only if he is able to protec'
himself by, ,a short hedge on
,

futures, exchange.
:;That is why. futures markets are
as essential fbr the trading in im¬
ported

commodities,, such

and rubber,

warrant

those in the agri

premiums

for

spot

price reversal does
completely the use

ket

times the dealer's and importer'

because the rise will be slow and gradual.

year,

111.,

meet

increased operating expenses, and

deposit

this

they

have

be done by

can

the higher yielding, longer-term obligations.

institutions feel

income

alternative

The

to
buy the outstanding issues, since the Treasury has not seen fit
to offer a security with a high enough coupon to keep them from
going into the longer maturities in order to get needed income.
110

now

but

changes
for hedging purposes,
though it may make hedg¬
mal

why the, tin futures market on

re¬
as soon as the government
returns tin imports to the private
trade.
1
The fifth type of hedging oper¬

Such

inaugurated

Metel^

Ler

taken

mar-

193?

Exchange and

19^3

Com

fohn^W | obllgatlons with gains of
since the announcement

effectual than under nor¬

conditions.

modity Exchange, Inc., reached a
total

over

1,000,000,000 ounces,
1933, to Aug.

And from December

volume was over 850,-

?aa nnt'

vj00,000 ounces. On Aug. 9, 1934 a
bomb exploded under this market
States

when

the United

ment

nationalized

Govern-,

Com-

silver.

individual field until

supply and demand once more is
in better balance. Until such time,
the value of futures markets as
hedging medium will
Futures Market as

However,

this

be limited

Price Barometer
does

not make

the

barometer.
The

such a price ba¬
is particularly urgent in
of metals, because prices

need for

rometer
the case

quoted on Commodity Exchange
frequently reflect more accurately
ations in the metals, field. is the the psychology of the ^respective
"producer's hedge. A mining com
trades, than the published, prices
panv
at which, producers offer to sell
believing, that prices, »wil
»decline, .yet anxious to maintain their products to. consumers di¬
continued operation and employ
rectly.
•

silunpredecented
However, the initial impact

ment

scale.
of

this

tax

was

to trade

blow

rather than to speculators

sources

the

because

largest

part

the

113,000,000 ounces of silver which
delivered to the Government

were

nationalization

under

speculatively
acquired for

was

not

held but had been

normal commercial

purposes

There

effects

were

this

other

long-range

silver

tax.

Since

applied not only to U. S.
citizens but to foreigners as well,

was

but for

fell

This

move

partially exempt issues.
have

concentrated

the

the strength

are

these

securities

...

There

seems

to be

mixed feeling

far

the restricted

bonds are concerned, with some holding the opinion that the out¬
standing marketable obligations should do better, especially those
issues that become bank eligible in 1952.
Others contend
.

that the mopping up

large part of the existing demand by
the non-marketable issue next month will take the edge off the
of

market for the outstanding obligation.

•

...

The 2y4S due 1959/62 and

the 2V2S due 1962/67 and 1963/68 have
a firm tone with indications of a good institutional demand for these
issues.
There has been some good buying by out-pf-town insti¬
.

tutions'in; the longest 2VfcS.

since World War I

in the devel-

commercial silver market was at
full parity with London. It was a
market in which domestic and
foreign producers,, smelters, refiners, manufacturers, banks,
dealers and brokers participated
and in which transactions were
predominantly n o n-speculative.
The final step in its broadening
occurred when the inauguration of
silver futures trading opened the
field to speculative participation
as well, and through the mechanism of a hedging market permitted the diffusion of trade risks.
There was nothing insidious about
such a development, as the spreading of price risks among outsiders
is one of the very cornerstones on

which futures trading rests,
All attempts thus far, to have
the silver transfer tax repealed
have failed. That means that we
are

missing

opment of an independent silver
market in the United States,
Early m the '30s the American

valuable opportun-

commercial and futures market in
in New York. As
things
stand, the law not only dis¬
courages
foreigners' from doing

silver
now

business here but it deprives com¬
mercial silver users

completely nullified
t

in this

coun¬

benefits of a hedging
enjoyed by other metal

of the

try

market,

industries.

How considerable

are

the

price risks of commercial sil¬

ver

users

fact

is best illustrated by the

this

that

silver

price

fluctuated

Restoration of

ket

tute

date, the
York has
high
of
low of 59% cents.

year,

New

between

86Y2 cents and

free silver mar¬

York

would

consti¬

valuable contribution to the

national

income

the

form

additional smelting, refining, mar¬

keting, manufacturing, insurance,
trucking and similar earnings. On
the other hand, the silver transfer
tax has no longer even a nuisance
value. We expect at its next ses¬
sion, Congress will repeal this ob¬
tax, and thus write finis

noxious
to a

economic his¬
which we have little
to be ■•'proud—the Silver
of the early '30s.

chapter in our

ity now—while England is out of

London.

had been made

in the bank obligations.
The powers that be
letting out some of the restricted bonds, but the activity in
has not been nearly as great as in the eligible
obligations.

still

its normal open

the progress that

com¬

The ineligible issues have also done better, probably ^sympathy

wjth

well, and, with
stroke, drove the silver

market back to

seemed

market in silver as
one

•

in demand from the larger

RESTRICTEDS A DILEMMA

spelled the death-knell not only
the New York silver futures

market

Monday....

were

the last four

institutions

for

•

about to enter the

was

market

ver

were

still very substantial.
.
Dealers, according to reports, have been
adding to their positions in the bank issues.

futures.

apparent that the Govern-

smaller

Zl/iS due 1956/59; and the
2Hs, due 9/15/67/72
Despite the sharp rise in prices of the eligibles the demand is

added handicap lies

vail in each

The

1/4 of a point being registered in many issues

2% taxables

longer term obligations such

modity Exchange had no recourse
but to suspend trading in silver |

become

the

mercial banks

through November of 1933,
futures
trading on Corn-

in the
What actually spelled the end
fact that distant hedges cannot be
of the New York silver futures
Dlaced at prevailing prices, plus
market was not so much the na¬
normal carrying charges, but only
tionalization of silver decreed by
at substantial discounts under spot
the Government late in 1934 nor
prices. • Since most hedges are even the extraordinary monetary
hedge sales rather than purchases
policies adopted at that time—but
this means that even should spot
rather( the iniposition of a 50%
prices develop, moderate :Mweakr
penalty tax oh all profits derived
ness,
the gap between spot and
from transactions in silver bullion,
futures
quotations still may be
The expressed purpose of this
closed, at least partially, by. a
relative firming in the distant po¬ measure at that time was to tax
sitions
as
their maturity comes away the profits of speculators
who had bought silver in anticinearer.
pation of a price rise once it had
This is a condition that will pre¬
The

All

During the seven months from
silver

^nanc*n& was. a
g eat dlsPlay of strength in the eligible obligations. ... . The rise
^aS VGry general with a11 issues sharing in the upswing, the neartei^ and mte™ediate maturities, as well as the longer-terU oblig?v°nS: * * / New hlghs were made in some of the more distant

commodity exchanges dealing

May

REACTION

in
metals, rubber, hides and raw silk.

hedge is the most widely usee vides, chief among which is the
role of a highly sensitive price
hedge in all futures markets. That

taking

mnd i tv Fvehanee
Tnc
modity Exchange, Inc., following
the merger of the four New York

not rule -out
of the ex¬

'-[As a.matter of fact, in norma

opened

an clement
markets, but the full effects of higher

In. the interim the commercial banks must maintain

financial I

and

metal

was

portant. There are other vital ser¬
vices which a futures market pro¬

Commodity Exchange will be

as a

MARKET

market

futures

theNational

early reopening of the metal
futures markets any the less im¬

is.

money

T„

hedging mar¬

circles in New York

even

ing less

silver

stranger

relationship is
in virtually all

cof

cultural? field, such as sugar,
fee or cocoa.:
<

The unpegging of the certificate rate has injected

uncertainty into the

i0ng

development.

rying charges that arise when a
commodity is stored in a ware¬
house for a period of time.
At

tin

as*

ures, .™rket for silver, short-term rates is not likely to be felt for some time, probably as
slim that the Lon-

chances

such

...

tremely urgent and no time should
be lost in clearing away the legal
obstacles which lie in the path of

outstandr, just the .reverse
"futuresmarkets. Nevertheless this

ing and uncovered commitments
a purchase of futures*

hedged,

much heat put

ket in New York has become ex¬

reestablished and

present this price

able.

UNCERTAINTY

the+leamtg.^?ildrestora- |
m,etals
is the

the need for such

regain their prewar status. They
are not likely to regain this place
completely as long as spot metal
shortages still are acute enough

of¬

protection.

is known

expected

markets are all

In both

market

for

restored in the foreseeable future,

This applies to com¬ orices or
nearby deliveries over
panies making semi-manufactured
he more distant delivery months.
metal products as well as to ulti¬
Normally distant deliveries in
mate consumers
of metals who
manufacture
finished
goods.
A .he futures markets sell at pre¬
miums over the nearby positions,
fabricator may find himself with
aecause
the quotations for the
a large
inventory on hand while
at other times his commitments distant deliveries include the car¬
the

are

than go along in an important way.
.There is no doubt about the
success of the forthcoming non-marketable obligation.

ading center. That

with
With

Trust accounts

I°r a new restricted issue at 100 that they cannot afford to do other

don silver futures market will be

advantage.

chance

order

futures at the end of 1939
amounted to roughly l,-000 conracts.
These figures show that
he market was broad enough to

fabricator of metals can
the futures markets to equal

exceed

taken

bond with insurance companies and

standing marketable securities, there has been
.

firmly establish New York's posi-

copper

relatively short time basis.

fers a

new

Although many non-bank investors would prefer a marketable
obligation or would rather ride the yield curve and trade the out¬

One further important step remains

coining offering.

savings banks also coming in for sizable amounts

Market
,

„

the

be heavy buyers of the

Hopes for Restoration of Silver

The

instances

the

change when

may

about

had
United

3,994 contracts, tin 981 contracts,
743 contracts, and zinc 490
contracts.
The open interest in

materials, this could be at least
partially offset by a profit on his
long futures transaction. Actually,
however, most of the business in
refined metals is at present done

may

reality

ead

price he has to pay for his raw

use

16,208 contracts. The total
divided as follows: copper

circumstances

also

that

States.

trading in metals
in New York reached a grand to-

buy futures
contracts when he enters
such
commitment.
Then should there
be an unforeseen advance in the

become

In 1939 futures

under

could

risk,

price

such

the

world

and

metal

red

notice

In«order not to run an un¬

tract.

the

served

free metals trading once more

tory

the picture—to Jay the foundation
for the development of a strong

follies

reason

(742)

THE

COMMERCIAL

CONSOLIDATIONS

mon

REVISED

the

Thursday, August 21,
ig47

Administrative Organization

merchandising

distributing

Bankers

and

ETC.

CHRONICLE

(Continued from page 5)

NEW BRANCHES

OFFICERS,

FINANCIAL

Sugar Future Trading in New York

News About Banks
NEW

trades,

merchants of New York

coffee

the

and

the

pass

briefly

very

administrative

were con¬

of other
or

York

by the New
Banking Department

State

Robert

that the United Industrial Bank of

Brooklyn,

has

approved

certificate of reduction of
stock from

capital
$300,000, consisting of

3,000 shares of the par value of
$100 each, to $200,000, consisting
of 2,000 shares of the
par value
of $100 each. The
change became
effective Aug. 6.
i

The

O'Dea

and

Philip

The

National

Bank

new

will

men

take

duties Nov.

their

over

Through

stock

dividend

$100,000, the First National Bank
of

down

receiver

membership

actual

the

board

vestigation

further

and

approval

Holdenville,

creased

•

Cashier

Metal Trades

Association, and the
Foundrymen's Association, and is ident.
former director of the Chamber
of Commerce of the
Oranges and

Maplewood.
*

increase

capital
Bank

the

Assistant

orate

his

25th

the bank

motion

Vice-Pres¬

Herzicoff

will

$50,000

Calumet

the

anniversary with

Assistant

activities

oan

National

cele-

Sept. 1 with his

the

department.

pro¬

Vice-Pres¬

ident; he will continue

>i!

Mr.

direct

installment

past

was

involved. This
improvement over the

vast

system

the

physical

laborious

tive

of August 7.

ident

Changes made in the top personnell of the
Chicago Title &
Trust Co. of
Chicago, have re¬
sulted in the appointment
of five
as
Senior
Vice-Presidents
and six
younger men to head the

men

operating divisions
was
indicated
in
"Journal

the firm it

the

Commerce"

15, which in part said:
"Holman

Chicago
of Aug.

25th

Presi¬
dent, said the reorganization was
unique because it was accom¬
plished without firing or

with

President
nounced

will

present
watch

Meyer

the

has

also

inauguration,

plan

allow

ployee of the bank
off

Mr.
the

anniversary date.

each

one

an¬

Aug.
em¬

Saturday

during each calendar month.
announcing the plan Mr. Meyer

pointed
other

Pettibone,

Meyer

Terzikoff

out

that

States

New

have

now

closing for banks

York

and

Saturday

and that he be¬

lieves it will be
only a matter of
time until California
follows their

"In inter-bank discus¬
hiring example.
sions of this
any
officials.
He
said
subject," Mr. Meyer
Chicago
Title & Trust
said, "we have
'simply changed the
consistently voted
responsibilities of the older men for
Saturday closing.
Pending
and opened the
common action
by banks in Cali¬
way for new re¬
sponsibilities
for
fornia, however, we are
many
of
the
acting
now to give each
younger executives.'-^
of our
employ¬
s

"The

five

Senior

Vice

ees

Presi¬

dents, he said, will devote their
attention

general

policies and
company-wide problems.
They in¬
clude Kenneth E. Rice
and Arthur
C. Marriott from the
title
division,
Chester R. Davis of the

the

off each

benefit

month.

one

Saturday

This is in addi¬

tion, of course, to regular
annual
vacations and other
legal holidays

throughout the year."
*

There was another
very impor¬
tant consideration in
this type of
trading.
That was the factor of

One

sure,

could

never

especially in periods of draschange, of the solvency

any

one

the

parties

chain of transactions
which might
form the so-called
"ring."
This
credit
risk, of course, applied to a
lesser degree on
simple transac¬
tions for
extended delivery be¬
tween two firms
alone.
To elimi¬
nate this credit
risk, the inter¬
ested merchants
agreed for their

self-protection

establish

Exchange
meeting place

where certain
approved individu¬
als or firms
may
execute their
orders in

modern futures markets and

iliary clearing houses.

aux¬

I think

is of interest to state to
you gen¬
tlemen the fact that never
in the

history of our country has any
commodity exchange clearing
house defaulted in its
obligations
to any buyer

Sugar

seller.

futures

augurated

trading was in¬
December,
1914

Prior to that time the
sugar trade
had looked to the

Hamburg

mar¬

and

of the floor committee.
It might be noted in
that the Coffee &

Sugar Exchange
under the jurisdiction of
Commodities and Exchange
Administration and this is true, I
is:, not

all

the

import

com¬

modity exchanges.
Contracts

Prior to 1936, the
vided

only

contract
raw

Exchange pro¬
principal sugar

one

which

warehouses

mate

raw

New

quotations reflected
Cuban

based

was

delivered

sugar

York.
the

Our

approxi¬

delivered

value

and

sugar

upon

licensed

was

matter, by deducting current

easy

ocean

freight
to

ance,

and

marine

compute

insur¬

Cubar

equivalent at which price

sugars

were

offered

buyers

indifferently

whether

the

all

Unitec

States,

United Kingdom, Europe
or
elsewhere.
In
other
words,
there was a one-price market in
Cuba for the

ers

and

entire

sellers

world

and

throughout

the

world.

During the middle '30s, our do¬
mestic sugar legislation
establish¬
ing sugar quotas for the areas sup¬
plying the United States changed

Goodrich, title division; William
Wiseman, trust division; Alber
Y.
Bingham, investment
division,
Joseph J. Snyder,
administrative
division; Joseph D. Shelly,
public
relations
division, and Charles F
Grimes, law division. Mr.

bone

also anounced
ments of John D.

Petti

the

appoint

Binkley, Victor

^0n

D' McKendry, Ken
neth W. Moore
and Harry G.
Aim
mermann as Vice
"Willis

Treasurer;

stated in the Portland
"Oregonian"
of

Aug.

from

which

also

"Russell F.

Watson, Vice-Pres¬

ident of the United
States National
Bank and President of
the Clear¬

House,

Greenwood,
manager

presided.

Frederick

Vice-President
the

local

branch

showing the con¬
world's opinion with
prices;
and
to
re¬

hedging facilities

sugar, the Coffee
sugar to its
the name

'New

Exchange addec
trading list. In 1916.
was
changed to the

York

Coffee &

change, Inc."

Sugar Ex¬

States
was

the entry of the
United
into World War
I, trading

suspended

resumed
real

until

beginning

producers whe
quota in this market soor
found that they could still
hedge
that part of their
production or
had

our

Exchange; but not that par'
which must be sold
outside of the
United
States.Our-

sugar and not
late in 1919.
The

sugar

futures

trading in this country, therefore
dates from about
1920.

Exchange

quotations,
quota
reflect

Upon
and

Presidents.
the Bank of
California, gave the
Monfort will
become address 'of welcome which
was
George L. Emerich
responded to by Mr.
Belgrano.

respect

establish

quote:

ing

recorded sales

sensus of the

result

legislation, had

begun

this

internal domestic
prices, which, in turn, fluctuated
inversely with changes in quotar

and

our

were

world

overnight
useless

Cuban

often

wholly unrelated

values.

had
a

Our

become

hedge

Exchange

The

contract

virtually

medium

"world""sugars,

for

for the

worked
six years

trading was suspended
shortly after our entry into the
extensively by

war, and was used

Cuban

and

other

producers

throughout the world for the
for which it

pose

Thus,

tracts,

one

which

other,

fied

was

have devised two con¬
a
domestic contract

call

the No.

"world"
No.

pur¬

designed.

and the

contract

Each

identi¬

calls for the

delivery of 50 long tons in licensed
warehouse either, in New York or
specified
Cuban
ports.
The

trading range in both is 18 months,
including the current month. In
other words,

for deliveries

trading

are

far ahead

now

Jan¬

1949.

We have recently re¬
sumed trading in contract No. 5
after a wartime
suspension of more
uary

than 5 years.
Trading in the world
contract No. 4 has not been re¬
sumed for reasons which I shall
not

enter into

that

but

now,

trading will

hope

soon

way.

under

Hedging Examples
I should like to

used

was

ments of
free

war

sugar market:
a

Raw

Cuba

active
is

part

onos"

Sugar Pro¬

there

mills

that

farmers known

and

part

from

cane

and is

paid for it
New

average

price for sugar.
ments

May,

the

to the mill

the basis of

York

These

market

cane

settle¬

fortnightly.
At
time, the mill is grinding

own

From

season,

first

made

are

same

its

"col-

mills

the

end

colono delivers his

the

company-owned

extends

January to the

the

cane

sugar. The

During the grinding

which

about

are

grind

raw

planted and cultivated in

themselves
land.

few

our
Exchange
daily by various seg¬
the industry in the
pre¬

ducer—In
160

give you

how

Hedging by

company-owned

this

you

can

mill becomes the

owner

cane.

that

see

the

each fort¬

night of two batches
one

cane

single contract was sufficient tc
give hedge protection for all
buy¬

old

Government
Exchange in

satisfactorily for

cane

London for
trust divi¬
Belgrano, Jr., new Pres¬
sion, Harold A. More of the ad¬ ident of the First
hedging facilities.
When
these
National Bank
markets were closed
ministrative division and
of Portland,
upon the out¬
treas
Ore., was welcomed
all this
and
break of World War
established a twourer's office, and
Harold L. Reeve by the bankers
I, leadership price
of the city at a din¬
market: One price for con¬
passed to New York.
from the law
To over¬
department.
sumers in the
ner in his honor
come the
United States; an¬
on
Aug. 7 under
inconvenience resulting
"The
operating Vice Presidents
other price for
to
the
buyers in other
and the general
producers, dealers and con¬
sponsorship of the, Portland
counsel who wil
parts of the world.
sumers of sugar from the
Cuban pro¬
head the six
absence
divisions are Paul W Clearing House Association, it was
ducers and other
of
B.

trading.
very
until'

and process it into

Sugar Futures

sugar de¬

devising the new contract and
by
Presidential Decree
conferred cer¬
tain preferential
rights and ex¬
emptions upon
sugars
entering
into the channels of

the

believe,

The Cuban
with the

cooperated

examples

passing

raw

our

contract.

ing rules prescribed by the Ex¬
change under the watchful eyes

mar¬

gins prior to
delivery.
Here, then, in the "ring" settle¬
ments and
margin requirements,
we
have the forerunners of
our

kets of

Frank

tice price

terminal

The

very rigid exact con¬
checking and duplicate checking
of
tract, in accordance with the trad¬
invoice, weights and grades.

Hammond, Ind., raising member of the Board of Gov¬
it from
$400,000 to $450,000 is ernors of the American Institute financial risk.
Several
months
made known
by the Office of the of Banking, Los Angeles chapter, might elapse
between the time
Comptroller of the Currency. The and is a holder of the Institute's goods were
contracted for and
enlarged capital was made effec¬ standard certificate.
delivered.

Following
established bank
policy, Pres¬

speculators.

merely provides

delivery

of the documents in
each instance
as
it
eliminated

the

and

upon

produc¬
throughout the world the
same
protective hedge
facilities for
"world" market
sugars that
they
had theretofore
enjoyed in

the

its

eased

ers

in¬

livered in licensed
warehouse in
Cuba, which would give

after

candidate

chain.

ber

some

election

managers

Unites
iULt;0

entirely new
designated Num¬

contract in 1936,

"seat,"

contains

inthe"

as
or

remedy this defect, the
Exchange devised an

names.

roster

Membership

same

coming back to him

another

the

one

the
308

endorsements had been
Sometimes an intermedi¬

lot of coffee

from

than

times that all available

many

space for

by
the
Okla.,
has
in¬
membership
committee.
A member-elect must
The brighter members
capital from $100,000
of the
Hubert F. O'Brien, President of to
$200,000 as of Aug. 5, it is trade finally got together and buy a membership or "seat" from
the A. P. Smith
the
Manufacturing Co. learned from the Aug. 11 Bulletin said, in effect, "Look
Exchange or from another
here, • we member and
of East Orange, was
recently ap¬ of the Office of the Comptroller should have
pay an initiation fee
enough intelligence
pointed a member of the Advisory of the
of $1,000 to the
to do this
Currency.
Exchange. Prices
thing more efficiently
Board of the Essex
of memberships have
Courlty Trust
*
*
>n
*
more
ranged from
safeiv.
We should set
Branches of the Fidelity Union
Announcement is made by the up machinery whereby all of this $31,000 in 1929 down to $350 in
Trust Company of
Newark, N. J. : 3oard of
burdensome physical handling and 1942, during the wartime suspen¬
Governors of the Federal
The Essex County Trust Branches
sion of trading.
At the present
Reserve System that the Wachovia transferring
are
eliminated
as
are
located at Main Street and
time, they are about $6,000.
much as
Bank
&
Trust
possible."
This led to
Company,
of
South Arlington
I never tire of
Avenue, and at
the procedure known as
N.
emphasizing the
C.,
a
State
Central Avenue and South Clin¬ Winston-Salem,
"ringing fact that
commodity exchanges
member, has established, effective out." Under this system, as it was
ton
Street,
East
Orange.
An¬
themselves do not buy or sell the
Aug.
16, a branch at Raleigh, established that prior to delivery
nouncement
ofMr.
O'Brien's
the same lot of
commodities
dealt
in
on
N. C., to be known as the
their
merchandise had
West
appointment was made by Horace
floors.
Neither do they make or
been sold and resold
Raleigh Office.
K. Corbin,
among the
in any
Fidelity Union Presi¬
way influence the prices
"ring" group, the original seller
*
*
dent.
registered
on
their
presented documents direct to
quotation
the
Mr. O'Brien is a director of the
boards.
The
actual
ultimate buyer and all others
trading is
in¬
Ben R. Meyer, President of the
National Association of Manufac¬
done by brokers
volved in the
who, in many
series of transac¬
Union Bank & Trust Co. of
turers. He is active in the
Los tions paid
pro¬
each other off by set¬ cases, are acting for clients such as
grams of the American Water¬ Angeles, announces advancement tlement
of the respective differ¬ producers, dealers, refiners, proc¬
of H. N. Herzikoff from
works Association,
Assistant ences in the
the National
essors, importers, industrial users
prices
*

vvi ^

this

used up.
ate receiver would find

N. Y. has increased

its

capital effective Aug. 4 from
$75,000 to $100,000 by the sale of
$25,000 of new stock.

retaries."
*

Crestwood

In Tuckahoe,

areas
ui^s

organized under our State laws.
type of trading grew There are the usual elective
offi¬
with the expansion of the entire
cers,
a
board of managers and
Paulson, Trust Officers; Logan D.
.market, it frequently became quite various committees.
The day-to¬
Fitch, Gifford N. Holden, Gordon
burdensome just to pass the es¬
day work of the Exchange is car¬
Marcovitz, John Y. Meloy and sential
documents of title down ried on
by an executive secretary
Glenn M. Trumbo, Assistant Vicethe chain of buyers and sellers and a
staff of paid assistants.
Presidents; Roy A. Holmes, man¬ and make
settlement on a spe¬
The
ager of the real estate and mort¬
by-laws
proviae
for
e
cific lot. Sometimes in an active
gage department, and Gustave C.
Of this num¬
market it was found that a bill membership of 350.
ber, 344 are outstanding, but be¬
Buchholz, Henry N. Buehler and of
lading, a dock receipt or ware¬
Fillmore W. Galaty, Assistant Sec¬
cause some individuals
hold more
house receipt had
changed hands

announced

Ct<5too
4States market.

commod¬

corporations

selves.

organization
of the
Exchange, since it is very

stantly buying and selling "spot" similar to that
and "to arrive" lots among them¬
ity
exchanges

CAPITALIZATIONS

Production of other
—*

sucn
such
over" Santo Dommgo,
Peru, Java
Europe that had no
quota or
insignificant qr~A- '
"
m
quota,
o

shall

the
or

of raw sugar;
batch produced from its own
and the other produced from

cane

bought from its farmers

colonos.

is sold

Since the Cuban crop

over

period of 12 months,

the mill assumes
tial market risk

a very substan¬
during the grind¬

ing season. It is the almost uni¬
versal practice of the modern en¬
lightened
our

millowners

Exchange all

sell

substantial

part of the colono sugar which
they are required to take over
during the grinding season. They
may likewise hedge part of the
sugar that has been

their

own

produced from
Many mills,; of

cane.

course, make sales of actual sugar
to
American
seaboard
refiners

during

the

grinding

since there

storage

season

but,

limit to refiners*

capacity,

necessary

that

the

some

other sales outlet if
they are

Cuban

producers

have

to protect themselves
against mar¬
ket
declines

during

half of the
year.

Hedging
cane
our

farmer

the

second

•

the

Colonos—The

colono also utilizes

Exchange. Sugar

cane

requires

12 to 15 months to mature.
During
this period the colono incurs cer-

COMMERCIAL

THE

Number 2622

166

Volume

cultivation expenses.
Sugar
and labor costs may be very
high
during the year of cane
growth, but the colono is not able
to cash in on these high market
prices since he is not paid for the
rane by the mill until it is actually

industrial user will over-estimate
the demand for his product. He
buys too much sugar and then
finds that his goods are moving
too slowly on a declining sugar
market. In this case, he would
protect himself against inventory
rut and delivered. Therefore, if he loss
by selling -futures in an
anticipates a substantial decline in amount equal to his processed

CHRONICLE

FINANCIAL

other price arrived at by guess.
The point is, in a controlled market, buyers and sellers have no
way of exprecsing their individual
judgment. In a free market, each
producer has a good idea of how
much he will produce, what it will
cost him and at what price he is
willing to sell it. The buyer

tain

orices

(743)

reading. They'll serve to keep
he political pot boiling, or at
east
simmering, while the

Tomorrow's
Markets
Walter

makers

either off

are

expensive junkets to make
personal* investigations, o r
Dack home explaining to vot¬
ers
why things are what they

Whyte

Says—
knows his requirements because
are.
he makes it his business to esti55 By WALTER WHYTE=
mate the Probable demand from
During all this fol-de-rol
his customers. Governments that News effect on prices com¬ ;he market is
placidly chew¬
attempt to estimate the demand
for a commodity must guess at the paratively nil. See no nearby ing on its cud, and the onfinancial ability of the probable change in market trend. Sug¬ ookers are getting impatient.
buyers. In a free market, each of gest continued caution.
Last
week
the
averages
his futures sale.
When the cane
Services of the Futures Market ?ese buyers knows m advance his
Whatever
has
happened were hugging that 178 level
is delivered to the mill, he natur- t
ProduCer
and
Consumer
I financlal resources and can estiand looked like they would
ally repurchases his outstanding should like to call to vour ItT"ate within a very narrow range during the past week has all
at
how
much
he
futures unless he is still bearish ™
1iust how "Juch he can very L been grist for the headlines. break it on the slightest
buy
various price levels.
Therefore,

market during the crop year sugar.
which his cane will be harThese are by no means all of
vested, he sells sugar futures for tbe hedge possibilities of the sugar
delivery 6 to 12 months in ad- futures market. I have cited pervance.
If his forecast has been haps the most outstanding examcorrect, he will receive less money pies and most of them have been
for the cane, but this will be offset taken from the records of the firm
in a general way by the profit on with which I am connected.

the
In

market and wishes to re- i

the

that ease, hi. podfrom that of hedge
seller to outright speculator on the

main short. In

Cuban fact

Hedging by

Seaboard Cane Re-

refining was virtually a
monopoly. There were only two
0r three buyers of
any conse-

during the grinding season.
result of this situation^ a<

on a
4"A

he has resort to our

factories

beet

The

yoa

I minds of
xcw i

some

people there seems
-

j?. bJ
the

futures mar

our

?I??~

floors

La™ 0 There

nothine

™a"£es' mysterious
.

n105

Ex
new

nothine

and

fnj^are ^nera«ons

numberofiirms

States is not

date for the first straw man.

ones

who don't benefit from

that

kind

do^ne

investigations will un
doubtedly make interesting

that

producer's sugar at the New Ines5^ur,ia£
.
York quotation and in some cases some
the ^ganized import
sugar mill. The farmer grows the
beets and delivers them to the fac¬ they will pay a few points pre- commodity exchanges, there was
mium, depending upon the tem- 8°m® °PP°sit10n from the firms
tory. The beets are processed by
fluctuations on the Ex- deahng m the spot article. These
the factory and the resulting re¬ porary
Interest rates have also firms, were usually rn an enfined sugar sold over a period of change.
since the producer by
po8 ?? a
com~
12 months. After deducting taxes, dropped,
and
discount, freight and selling ex¬ hedging some part of his production on the Exchange can get very that would come from the forma,

hrei?.cbed
Petition

the net proceeds of

penses,

an even

the

favorable

approximately

divided

are

year

because the market risk has been

basis between the fac¬

whole

fixed

insurance

the Exchange,

duties

adjust
freight,

the

buvers

London, Havana
Peru know the world mar-

sellers

Java

ket value of sugar as

well

the

brokers in New York.

sugar

firm

™

repurchas¬

e^beruser, be Producer>willingly
b who would distribor

utor

lessened

ticipates
able
:
use

that

decline but it is prob¬
our

[ng^crops
less for this pur-|

American

the Exchange
"

pose

larmers
farmers

than do the cane farmers in

and

^ has linked

tinuousr ready

Cuba.

Hedging by Industrial Users of
.Sugar—Many of our large indus¬
trial users of sugar, such as the
bottlers, candy manufacturers,
bakers and others, use the Ex¬
change as a matter of ordinary
business routine.

candy

user

For example,

manufacturer

orders for

may

the,Christmas or

book
Easter

price

information,

signal to advise repurchasing,
Aids

for

Suggestions

and

Im¬

Operations — Bank
Management Commission, Ameri¬
proving Bank
Bankers

can

36th Street,

12 East

Association,

New York 16, N. Y.—

tated

the

are

part of our free

integral

merely

purchases

buy the

refiner, he

equivalent

with

his

out

work

own

utile

length the importhe
price-registration
the Exchanges.
Dur-

minimum of regimentation.

With Social

German Experience

ing the war when sugar was under government control, no one
had any jdea aS to the true value
of sUgar.
When decontrol was
being debated during the early
part 0f this year, we heard re¬
sponsible officials of the Department of Agriculture prophesy that
a price
0f 30c. to 40e. per pound
might result if sugar were sud-

S. Arnold—Bu¬

Smart and

Research,

Business

reau

Col¬

Commerce and Adminis¬
tration, The Ohio University, Co¬

lege of

lumbus,

Ohio—Fabrikoid—$2.

the market has declined, he would

Exchange for raw
naturally sustain a loss on his fu¬ sugar for 1948 delivery.
This
tures but then he would be pay¬ would translate itself into a price
ing less for his refined sugar,
of about 8c. wholesale for refined
"■j It frequently happens that an sugar and not 40c. or 30c. or some

quoted on our

look

And* unless

down.

the

Buenos Aires Bonds

Called for
Hallgarten

March

ince

which
able

from

litical

believe to

be insepar¬

economic freedom, po¬

individual

and

freedom

freedom.

threat¬

last

but

never

broken.

You have it at 83 and

it's

about 88.

now

& Co.

—Walter
More next

and Kidder,

dollar bonds of 1935,
1, 1977, of the Prov¬

Buenos

(Argentine

Aires

So long as

stays at 87 or better hold

[The
article

views
do

expressed

this

not necessarily

coincide

time

Chronicle.

Whyte

Thursday.
at any
those of the

with

They

are

those of the author

presented as
only.]

Republic) that all of these bonds
outstanding will be called for re¬
demption on Sept. 1, 1947. Re¬
demption will be made at the
New York offices of the paying

Pacific Coast

accrued interest.

Securities

to The Financial Chronicle

Special

BOSTON,

MASS.

has

Flanagan

—

become

John

With Hope &

associated

BOSTON, MASS.—Theodore A.

Co.

Orders Executed on

Special to The Financial Chronicle

SAN

DIEGO, CALIF.

H. Harley has

staff
Trust

Hope

—Wilbur

been added to

has

been
*

added

the

staff of Goldman,

Sachs & Co., 75

Federal Street.

Coast Exchanges

the

& Co., San Diego

Savings Building.

Pacific

Schwabacher & Co<
Members

New York

Joins Elworthy
Special

Staff

to The Financial Chronicle
14

OAKLAND,
Bullen

has

CALIF.

joined

the

Elworthy
Street.

First

Co.,
was

David
staff of

—

1710 Franklin
previously with

California Company.

Stock Exchange

York Curb Exchange (Associate)
San Francisco Stock Exchange
Chicago Board 0/ Trade

New

New York 5. N. Y.

Wall Street

COrtlandt 7-4150
Private Wires
'

Waldron

week

Redemption

agents at par and

With Frederick Adams

The 87 stop was

ened

on.

Peabody & Co., as paying agents,
are
notifying holders of 4V8%4%% external readjustment sink¬
fund

Steel.

due

with Frederick C. Adams & Co.,
futures on the
Exchange. Then later, as the sugar
30 Federal Street.
Mr. Flanagan
is
needed for processing in his
was
previously with J. H. Godplant, % he goes to a refiner and
dard & Co., W. F. Rutter & Co.
purchases for prompt delivery and
closes out his Exchange hedge. If
and Elwell & Co.
the price of sugar has advanced,
he
pays
the refiner more but|deniy decontrolled.
Today, some
With Goldman, Sachs
makes an approximately offsetting seven months later, we see prices
profit on his futures purchase. If of
Special to The Financial Chronicle
slightly over 5c. per pound
amount' of 'sugar

way or
stocks look

one

few

another.

itself

Conference

Industrial

ing

definitely lined
the side of free markets

greater
of

nothing

saying

can't

At least I

market

the

because

Insurance—Walter Sulzbach—Na¬

The Exchanges are

should like to emphasize at a

function of

that time to

future

telligently plan ahead.

tance

supply and demand and
enabled businessmen to more in¬

If he finds it inconvenient or im-

necessaryrsugar from a

facili¬

trends in

trade several months in advance.

possible

forecasting

has

can't.

but I

capable of going up but these
are cancelled
by others that

Association

We of the National

believe that commodity exchanges

best

has

preponderence of market ac¬
suppress or destroy the Sugar Ex¬
tion points up
I shall con¬
change.
They ail look uoon it as Board, ' 247 Park Avenue, New
tinue advising the side lines.
York 17, N. Y.—Paper—$1.00.
a usefu1' necessary Part of the
The only stock left in our
™™P«cated marketPractical Rules for Graphic Pre¬
ln^ mechanism.
theoretical list is Bethlehem
sentation of Business Statistics—

Warehouse Stocks; I j^ntlvdlrec^^
all the markets of I
X X™ believes
market* for both'that the individual himself can
destiny

buyers and sellers at all times; by
supplying accurate statistical and

I wish I could inter¬

pret the present action into a

tional

the beet and cane ducer and
consumer,
and that
refiner and industrial
they are vested with a public insugar.
It has materially terest.
Today, the world is di¬
the costs of distribution;
vided into two camps: one be-

against his growing crop if he an

reaction

averted.

processors,

ing later

been

nearby

ZX £'

for the farmer,

the sugar is sold. The
beet farmer can also sell futures

timistic to the extent that the

individual,

Ex^chanse'provides^idce insurance I| en*erPrise advantage ofthey opersystem; that both pro¬
Exchange provides price insurance
atg to tbe

part of its expected produc¬
on

differences
and

and

harvesting season, it is not at all
Uncommon for the best factory to

quota¬

the

picture of
last
week
has
slightly
changed the outlook tends to
become a little optimistic; op¬

Paper.

I know of

homogeneous

appropriate

for

ments

factory and the farmer receive a
'lower average net price.
If the
market is attractive during
the

tion

result of the quotations

as a

change.

harvesting period. Nevertheless, if
the market is declining, both the

sell

markets of the world

become

constantly going DUt from our Ex¬

for his beets at a
market
price during the
pay

disseminated

widely

tions.

The sugar
have

the Cuban mill because he

not

does

'and

eliminated.

and farmers. In this case,
-you will note that the beet proces¬
sor does not take the same market
tory

risk

organized exchange
W1*b its continuous ready market
an

banks

the

from

loans

that

Now

the enlightenment

the

are

ket.

our

any

of market

There just isn't any
business in that kind of mar¬

brokers.

~urse.r thd conduct of
busi
*ty *or^theconduct of ou, busi

here and m Havana that will buy

greatly different from
confronting the Cuban raw

about

of the suSa^trade accept the
°f

from

C»

and I undergone a very radical change
25 years. There

writing, it has man¬
lift itself slightly
the
danger point by
two points.

aged

These

Thev

naturally charged high interest technical methods of
busirates on their loans and bought
erew
riirecU
the producers' sugar at substantial L
f
a
tf ™ , the snot mar
/Iir<nAim +
*
*
discounts. With the coming of 'fVih L
the
^
futures market, this situation has

situation of the during the past
in our Western' are now a large

this

This kind of action is grati¬
dollar-shy problem. The next fying even if it doesn't settle
important event is the highly anything. It serves to make
publicized
Justice
Depart the bears a little more nerv¬
ment probe of prices, with the ous and it acts as a bromoseltzer for the bulls. The only
steel industry as the candi

snecialized

hiahW

n^ th1t

TT153 T* —

Hedging by Beet Processors

Growers-The

producers.
Since these Havana
buyers had to take the market risk
for a long period of time, they

protection.

temporary

for

ket

just yawned and hitched up its pants, spit on
gaped barely moving in either its hands and held on. So by
direction for hours at a time. the end of the week, and up

'
,

L ~®'08,

fished themselves in Havana and
acted as buyer and banker for the

declining market,
A11Y*

*.!

■**

powerful commercial firms estab-

inventories become un-

when his

comfortable

VGar

next monto

today

process

sugar,

however, has provocation. Before the week
stock market. was over the market sort of

it,
the

The market

Plaae

fo^dehverv

bothered

biggest news is of
present today are
course
the British financial
quence. The Cuban producer was n° doubt familiar with these valumore or less at the mercy of the ?
ec()nomic services performed situation with everybody
'by our' Commodity Exchanges
American buyers. They could not ?y,
commodity kxcnanges, taking a pot shot at guessing
out-wait the buyer,: but had to ^
aF®.not.Sa wel1
the public at large and by
how it will come out of its
turn part of their sugar into
'
the uubhe of
and ;he
hv

it into refined and carry it in his warehouses until.the trade is ready to
take it off his hands. Many times

ityv

cognsumer. £ur_

sugar

big volume - business
requiring
large
plants and ample capital. Despite
the fact that sugar is used daily 1
by every citizen in more or less
equal quantities, its distribution
from the refiner level is extremely
uneven.
The distributing trade
buysmn what are calledr"moves";
taking on at one time 30 to 45
days'supply. This means that the
refiner must buy large quantities
raw

and

are

come together in a free

hptwp^n

ing the early part of this centu*.

finers—Cane refining is a

Little

sejWs

when buyers a„d
i

side.

bear

changes

tion

San

Francisco —

Monterey

—-

Teletype NY 1-928
Offices
SantaSacramento
Barbara

to Principal

Oakland

Fresno

(744)

THE

Bretton Woods in
(Continued from page 6)
no

Theoretically

the
objections
important, but it

are

pear

practice,
'near future.
to

avoid

tional

policy,

they will ap¬
importance
rate in the

any

the

failure

period"

the

its

connection with

well

4Vi/-»

the

make

tion

Woods

Bretton

balance

will

deducted

that

with

Bretton

^
plain sailing?

from

portant

lition of the foreign
currency

ity, which

Woods

influence

for

American

im-

reestablished

inlori£~ I

coming turbulent years it may b

addition,

«lTJm?.?^anundaubtedS
thvlhpro
-•n

^!wi'

most keenly conscious of the
tremely
vulnerable
position

Piir
Oh

JJdd

perhaps

ties

have

already been known

arise

dollar
ftf

various

^ appeared

countries

anew to the whims

unlimited

development

juncture.

which a large part of the world
finds itself today. Acute difficul-

gained that those who aim their
shafts at the Fund are at the mo-

to submit

ex-

The

wartime

controls

dropped

been

liquidation

of the

foreign currency
On the other hand it
able to contribute little

this

will

considered

the existing balance of
payment deficits. If it is the aim
the

Fund

fulfill

the task allotted to it

doubt in this respect
the Fund will not be
one

the

into

is a

room

for

few

soon

The

in the

corpses

cur-

the

sound

dollar

iess

wiJ1

until a more advanced
development has been

vfe rArAnelled tA
quests

for

the

purchase

bringing

about

rency.

Two

Operations of the Bank

stage

of
reached,

points

are

Hs'w&hiinAd par1from

thp

not

that

the

Bank

should

much be regarded as

international

serYo^

organ

cooperation,

but

and

the

Bank? -I

number

countries

not

com-

the

trade

help to the

struggling

with
difficulties.

reconstruction

current

their
B

payment
between

intercourse

countries which

and

the

short of for

are

eign currency mutually threatens
to stagnate
through lack of a gen
erally
accepted
internationa

C^^eL5^!h+WL1!Gh

Ster

Fund to call to order

crec^ts

of
of

does

unlimited
not

contribute

wards

the realization of
librium of the balance

ments.

The

cumstances

received

reaching

equi¬

used

Keynes

fjnal Act"
the
pards

between the nature of the investments
made and
the duration of the
credit proin

that it

not

was

mind

transfer

compound

caused

interest

much

the

economic

the

loans,

that

the

strength,

nevertheless

inclination
of
the
investor to cooperate.

lem

settled,
solved?

will
I

are

rehabilitated.

Fund
w^re> nevertheless,
a^c<ercise a wholesome influence
e

I abo^fbv Cviidue
|

mischief I

this

acute

There is for the time

b^ing

prob¬
believe

|
also 1

po-

moral

and

moment

there

temporary

problem

problem of

ture.

the

Once the

demands of
behind
this

hidden

permanent
^

recovery

process

has

na-

temporary lack

has been corrected,

ican

the

republics

the

name

problems
in
East which can
We of the Amer¬

won

have fought for
with
that

certain
cannot

our

any law
vidual whose

inalienable
taken

decree,

him
indi¬

standards of moral

conduct
are
the
essence
of
a
peaceful world.
But what is more

important,

we are devoted to the
principle that States and nations
should be
bound

standards

the

of moral
conduct

for the

same

set

individual. Good faith and
dealing, honesty and friend¬
ly cooperation, mutual
respect and
fair

freedom of

intercourse—these

expect of each other

als,

these

each

other

in turn is

bound

employ¬

remarked, it

not

my intention to
give a
opinion
on
Bretton
Woods. It was
merely my inten¬
tion to point to
several problems;

which will

faced.

ference
two

inevitably have
view of

sides

the
of

the

mentality

the

great

dif¬

the

Atlantic it

can¬

not be doubted that
profound dif¬
ferences
will
still
have to be
overcome.
The Allied

initiative
that led to Bretton
Woods is both,
important and
encouraging. One

should, however,

not allow one¬
lulled to sleep by the
illusion that the universal
self

remedy

for all postwar
currency perils has.
once and for all.

been found

individuals,

"We

demand

moral

conduct

individual
"With

fun¬

principles of

demand of the

citizen.

foundation

assurance

that

must

termination

that

reject
the

upon

any

funda¬

rights of the State. I am
confident that we all
agree that
the State exists
for man, not man
for the
State—and that we abhor
men

world.

cern

with

mutual

For

only

shall go

strengthen
system

to reorganize and

our

and

inter-American
make

more*

for

respect

one

another

the objectives will
And the world will
a

both

attained-

learn, I hoper

great lesson."

Herrick, Waddell Adds
to

The

Financial

Chronicle

KANSAS
Waddell &
more

CITY, MO.—Herrick,.
Co., Inc., 1012 Balti¬
Avenue, have added G. H.
staff.

Buy U.S. Savings Bonds
REGULARLY

when

can

connivance,
develop

common

interest while
time
respecting sep¬
national traditions.

words because

been

stem.

v^__

*%! 1

pledgee

know the forces

opinion Jrom which they

We stand to all the
world

example of States striving

to live in

)

same

of public

effective agency of
cooperation in.
pursuit of our common in¬
terest. With good will and mutual
the

throughout

"We of the
Americas, I think,
have achieved this
goal—we have
no
secrets from each
other—we
have confidence in

defence and'

security; tomorrow, at Bogota, we

have access to the
thoughts of
men, to the forces of
public opin¬
ion free of coercion
or

the

problems that may present them¬
selves in the years to
come.
To¬
day, at Rio de Janeiro, our con¬

any limitations
upon the freedom
of expression of

arate

these-

solve

can

the

encroachment

have faith and

can

McCullough to their

mental

the

same

principles

Special
our

reject encroachment
fundamental rights of
the individual with
the same de¬
upon

by the

equality of
equality of

the

States.

page

abide

individu¬

should
States.

"This is the basis of
damental belief in the

once

completed, the possibility that the
more
profound structural read-

rights

from

our

freedom

democracy.
We
the dignity of the

b,y

only
then
wholesome

shortage of dollars every-

^f^he^itenm- I balance

tional authority which it will have
to acquire.

the
not

satis¬

Question of Dollar
Shortage

are

so.

solution, be it only because there- where, caused
by the
^ be..a^bhoiied foreign curiency
reconstruction; but
„

the

factorily

partici-

scarce

with

to whether this

Even if all these points

cu^e cy

here

necessary assist
not, if it does not ex¬

will

American

adopted in the

difeCl
of

I restrictions

well

deal

help
will
be
timely
and
adequate
whether no political criteria wl1
be applied which run
contrary to
the economic
yardstick, whether

exceed

Js denb^d
~

borne,,,

enough to what extent
the balance of
payments position
of the debtor
country made P°s"
s.bie the regular

was not

questions

ceed

far_

mQre

not

ance

envisaged in the plan

management

ex-

tremely unwisely, that insufficient

and

White, but

harmony existed

vided,

great deal

to¬

shall

give

the extent of the

ihl

easily

often

distobs

war

of pay¬
combination of cirthat loans too

were

debtor

which

tbe international regulations, are
not very convincing, at least not
private | on Paper- The authority in question wag

tlm first world

erantine
granting

^dedcount^
oerience

nowpr<,

and

developed

individual—an individual endowed

also

the Question arises whether there
is adanger of the inter-currency I

the

not be ignored.

outset

have

war

Europe

able to offer
adequate

piace

that

relation to the

international trade

definite

(Continued from

litical

secon(j

far few

by the

plications which it would be wise
not to take too
lightly. The present problem is above all
a dollar
problem. Only the dollar area is

.„

are

indicating

isolated problem

European Recovery Vital: Marshall

seen

attention

approximate

significant

the

even

able to provide a definite
answer
to this
question, but I can draw

Significant Points
.

place, there

symptoms

danger that

light,

During tbp difficult transitional rbis conn?ctlon. In the first place means of
the difficult
,c
| thp mipstinn ariRfiS as to
payment, in which ca
i the
question arises as to whotw I
years, therefore,
whether
stress^ will have I the means to reestablish a dis- pacity the dollar alone can ulti
mately serve. For the time
the
nS oninkln2 turbed equilibrium,
being
Bank. °p
by
Generally speaking, ^ Fund, will prove possessed for everything is centered around the
fewer ob]echons have been 1
adequate
alsed
help America is prepared to
Ljlejr
jn
,

World

Fund

evident

Dnrincf

New

the difficulties of the
transitional
period, or is there a possibility
that these problems will
prove to
be beyond the
strength of the

balance of payments
equilibrium,

cur¬

second

Bretton Woods will at least
solve

v»

ExecSive
n^ouhtprilv

the

a
considerable degree
products which
compete directly
with American
production. In the

achieved.

ncp

^elatfvelv
SnuS

cannot be solved
ul¬

policy can
improvement

become

exports
comprise to

not

reversely,

lacking
American

difficult to

with all questions of
conjunc¬
control and
"full

was

t fend

does

use

counter¬

be reached

never

this

whilst,

the

As I have
already

place, Eu¬

foodstuffs

ment."

permanent need to im¬

American

the

lasting

ture

as can be as¬

In the first

doubts just mentioned are
futile,
because they are related to a
situation of which it still
remains to

judgment

the actual diffi-

not

real

stage will

Seen

sensible
an

has

only

relations, which

the

materials which
produce itself,

Reached

crop

however,

both sides.

rope

countries

regulation

sumed, encounter difficulties from

port

but

will

necessity,

This

area.

raw

once
a
reasonable
equilibrium
had been
brought about. There is.

this

Considerably more reservations
thi rirnSXfhfllanPA Wfmust' however, be made in connection with the
functioning in
Svrnlri wUi hP cn^
f
the more distant future- !t ls at
^
lllf vi nf present still an open question how
short riiwation "
(First Button
Woods would behave,
report
to^
?
ld
Bank succeed m findTW?Pn/nr^
LiS lng a solutlon to the most urSent
teAon the FitnH will
problems °* reconstruction and in
Ic

timately

the

rium, will, however,

calamity,

So far I have
spoken of the bad
which
would

de¬

time

manner be¬

own

tary question

consid¬

surplus

Woods will be
able to maintain
itself. The mone¬

The

qua non for a dur¬
able balance of
payments equilib

Equilibrium Stage

export

the

loans,

export surplus, it
see
how Bretton

condition sine

whether

seen

also in

crux

insisting

.the means to
finance

the loans granted
them if they succeed in
build¬

ing

will

chances

hands."

future be such that

near

international situation will

Lulties

^ 1Y

its

Woods

realize

signs of
health before offering
itself with

^ V«Paj f' but contribute to
Sa framework of theilat- Lf the situation;
quota, but will most
ceitainly

should

0f the

Boardof

foreign

remains

increased

foreign

he interests

the rapid
increase and, in

against such

or-1

executive bodies, to which
a|so tbe debtor countries can explain their point of view.

establishing

The Fund

trust

our

wLi
tend to sell unlimited

urge

too

("The Economist" March 8,
1947.)
jn this connection we must
place

equilibrium has been
achieved; it is not called upon to
contribute
towards

wc
ters

[

severa|

The

comes

certain

necessary
to
be

^ may soon

extensive

years.

Bretton

Will

reasonable

the task of
an

that it is dealing with
some very
members and that if it waits
unm each patient shows

di-

typical organ that

action

degree

first

also

"Economist"

not

fmanc-

It is

thodox'

correctly

ing institution—and the
rectors report leaves no

Fund

evidence.
that the

the.

to bridge

spirit,

have

homl

conjuncture difficul¬
ties, of foreign countries

European countries con¬
will only be able to
honor

cerned

America,

the

regulations.

means

intention to make

act her

disposal

hand,

enormous

currency arrangement is
not out
of the question.
However, if it is
America's

been

creditor

repayment of his

Dollar require¬
other

the

The

activities more
slowly than was economic policy
aiming at the wrong target.
aiming at stabilinitially expected; as far as our
one
ity, conjure up the fear again that
hand, the Fund will
country is concerned, the recent an orthodox
not be able to
oppose necessary
depression cannot be
exchange revisions and will not foreign currency memorandum of avoided, if not immediately then
the Minister of Finance
be able to
provides certainly within a few
bring about forcibly the
years'time,
conclusive
On

the

United States

fitting

erably.

clination to carry on a
long-term

ment

Europe will therefore

prove

American price
general, the lack of American in-

when

that the Bank began

resources

prepared,
when
comes, to behave in a

Asia-

permanently.

drive

are

their

surplus
All indica
fact that ihl

true.

that country. This
is the
the matter. If the

which

now

counter a
depression on the
market, which is expected

long time to come,

even

ments,

which

have

export

trilateral

prewar

will, in the
import

point to the
United States regard

cisively reduced.

con-

speed with

the

destroyed for

international

on
the manner in which I discomfiture
in
Europe,
where
j30^ organizations
carry out their there is in general no
inclination

tasks', whfeby th?y haYe..to be

prove
nf

from

territories

States

tions

partly

raderelations—Europe-East

understanda

rery

depend

transfers

America—have already

Dility. On this poi
up here. On tne contrary

Asian

unDleasant-1

into

covery
period, however, Europe
will not be the
creditor of Amer¬
ica, but the other way round. In

that.

taken

hemselves registered an
export
surplus in their relations with
America. At the end of the re¬

good will most certainly fail if the parre-i^
expected in the near fu-I ticipations
strict.ons; a proper use of the
have
"to
struggle
—v,
iv*
TPnr»ri 1rd-.
+V10
ture, whilst, as far as the Fund
com
numerous
intp
escape clauses
| through the same internal dis¬
will, i .g
it appears to
concerned, it need not be par- I culties as
me, most certainly |
previously for the sake
t|ril^aPiv
fPared

the

East

gold

the

«^n

investments,

from

location.
The position was ex¬
actly the reverse in respect of the
floating standard. Bretton Woods

tUl
an

com-

however, achieved

was,

United

run, tolerate
The opposite

European countries had in their
trade relations with
America also
before
the
war
was
financed
partly
from
the
income
from

international stabil-

was

deficit, will most

consideration.
The import surplus which
most

at the cost of radical internal dis¬

con¬

I believe that spe-

pjaiiv ag regards the DdlliV
ciaily as xegdius Uie Bank

oKrv
desired abo¬

the

everything

standard

dollar

have

definitely have

only

if it

purpose

The great merit of the

ard.

pay-

its

meet

nected

in I

the

foregoing

observe the necessary supple¬
ness both as
regards the currency
at

able

result
caused

are

will

war,

chronic

bines the advantages of the Gold
Standard and the Floating Stand-

May

Statutes, it will inevitably have

,.,HU

ments

stability aimed

the

then

librium

"transi¬

recognized

Retrospect and Prospect

it will

Thursday, August
21, 1947

justments, which

extremely important contributions

Fund, wishes

CHRONICLE

to economic reconstruction and to
the recovery of the general equi-

equal

FINANCIAL

If the Bank proves i no cause for
optimism regarding
to
be an organ that can make
the intensity of the shocks to
available sufficient loans with suf- which an eventual
balance of payficient guarantees with
regard to ments equilibrium would be exthe aforesaid aspects of the loan
posed.
The
currency
organizar

favorable in respect of
other countries hit by the war.

is doubtful whether

in the thirties.

mentioned

COMMERCIAL

harmony determined

Ask where
you

WORK

Ask where you BANK

J
I

THE

Number 2622

Volume 166

COMMERCIAL

Securities
•

Electric

Acme

Corp.,

Cuba,

N. Y.

(9/3)

123,246 shares ($1 par) common stock.
Underwriters—Herrick, Waddell & Co., Inc., and First
Colony Corp.
Offering:—To be offered publicly at $5
a share.
Proceeds—Company will receive proceeds from
the sale of 58,880 shares and four selling stockholders
the proceeds from the sale of 64,366 shares.
Company
also will receive proceeds from the sale of 20,000 war¬
rants for common stock to underwriters at an aggregate
price of $2,000. Net proceeds will be used to pay current
bank loans and for working capital.
26 filed

June

Alliance

•

Acceptance Corp.,

Alliance, Ohio

15 (letter of notification) 3,000 shares ($100 par)
41/2%. cumulative preferred, of which 1,000 shares was
exchanged share for share for outstanding 6% preferred
Aug.

and 2,000

shares will be sold at $100 a share. No under¬
For working capital.

writing.

New York
2,800,000 shares ($100 par) capital stock.
Underwriting—No underwriting. Offering—Shares will
be offered to employees of A. T. & T. and those of 38
subsidiaries, with the exception of officers, at approxi¬
mately $20 below the market price. Payments are to be
made in instalments at rate of $5 per share per month,
beginning December, 1947. Proceeds—To finance con¬
American Telephone & Telegraph Co.,

•

Aug." 15 filed

struction programs.
American

Vending Machine

New York

Corp.,

shares ($1 par) common. Under¬
writer—Reynolds & Co., New York.
Price by amend¬
ment., Proceeds—Of the total, 120,000 shares are being
sold by stockholders and the balance by "the company.
The company will use proceeds for organizational pur¬
poses, which includes the merger of Berlo Vending Co.,
Philadelphia, and Sanitary Automatic Candy Corp.. New
York. Name of company will be A. B. C. Vending Corp.

June 30 filed 145,000

American Water Works Co.,

$5)
additional number determinable only after the

Underwriters
—To be filed by amendment. Probable bidders include
Dillon, Read & Co. Inc., White, Weld & Co., and Shields
& Co.
(jointly), and W. C. Langley & Co. and The
First Boston Corp. (jointly).
Offering—Price to public

results of competitive bidding are known.

by amendment.

Now

dividends

ISSUE

American's

stock.

common

poned.

purchase of the stock submitted July
22 were rejected. A joint bid by The First Boston Corp.;
Shields & Co.; Drexel & Co., and White, Weld & Co. of
$17.68 per share and a joint bid by Dillon, Read & Co.
Inc., and Smith, Barney & Co. of $16.30 per share were
submitted.
Steel

June 17 filed $3,000,000 15-year sinking fund debentures,
due 1962, with non-detachable subscription warrants for

purchase of

common

stock.

—
Name by
Proceeds—For pay¬

Underwriter

Price by amendment.

amendment.

of loans and for other corporate purposes.

ment

•
Blank, (R. H.) & Son, Inc., Walcott, la.
Aug. 12 (letter of notification) 1,000 shares 5% preferred
($50 par) and 1,400 shares (no par) common. Price—

$50

underwriting.
®

Bob's

Aug.

share.
For equipment and machinery.

preferred

Cola

Co.,

and

$35

common

Price—$3

common.

Inc., Atlanta, Ga.
88,750 shares ($1 par)
share. No underwriting. For ex¬

pansion of business.
Brayton Flying Service, Inc., Robertson, Mo.(
(letter of notification) 50,000 shares ($1 par)
27% cent cumulative, convertible preferred and 50,000
shares (10c par) common.
Price—$5 per unit, consisting
of one share of each.
Underwriter—White and Co., St.

March 24

Louis, Mo. For expansion of operating facilities and
working capital.
*

for

Co., New York. George Eastwood, President, in letter
stockholders, Dec. 22, said: "We have come to the con¬
clusion it will not be necessary to issue any additional
shares of common stock" as part of company's refinanc¬

Underwriters—To be filed by amendment.
Rejected—Company July 23, 1946, rejected two
bids received for the stock. Blyth & Co., Inc., and F. S.
Moseley & Co. and associates submitted a bid of 100.06
for a 4.30% dividend. Harriman Ripley & Co. bid 100.779
for a 4.40% dividend. Indefinitely postponed.
($100 par).

Bids

20 and postponed to June 18 further delayed.
reported company has abandoned sale of preferred
for a construction credit and term loan of $9,000,000
for May
It is

which the company has

Capital Transit Co., Washington

being offered by Washington Railway & Electric Co.
its common stockholders at $20 a share in the ratio

outstanding
65,000 shares of common, will receive warrants to pur¬
chase 90,394 shares of the offering. It also will purchase
any shares not acquired by other stockholders. Proceeds
—Washington Railway,, will use proceeds to redeem $2,of

holder

50,197

of Washington Railway's

800,000 of bank loan notes.
Carscor Porcuplna

Gold Minos, Ltd., af Toronto,

Ontario
June

24, 1946, filed 400,000 shares of common. Under¬
underwriters.
Offering — To the public at

share in Canadian funds.
Proceeds—For a variety
purposes in connection with exploration, sinking of
shafts, diamond drilling and working capital.

•

Porcupine Gold Mines,

Carshaw

Ltd., Windsor,

Corp., Chicago (10/1)
July 25 filed $800,000 10-year first mortgage 4%27o sink¬
ing fund bonds.
Underwriters — Illinois Securities Co.,
Joliet, 111., and Mullaney, Ross & Co., Chicago.
Price—•
Par.

Proceeds—To pay usual

Aug. 18 filed 700,000 shares ($1 par) common. Under¬
writer—Davis, Hunter, Scott & Co., Detroit.
Price— $1
a share.
Proceeds—To purchase mining equipment and

Electric Co.

March 19 filed 522,416 shares ($10 par) common, being
offered by American Gas & Electric Co. Underwriters—

for

working capital.

by competitive bidding. Proceeds—
of American's plan to dispose of its

determined

Continental Casualty

Co., Chicago
Aug. 15 filed 100,000 shares ($10 par) capital stock.
Underwriters—Glore, Forgan & Co., and William Blair
& Co., both of Chicago. Offering—Shares initially will
be offered for subscription to company's stockholders on
basis of one new share for each five shares held. Un¬
subscribed shares will be offered to the public. Price by
amendment. Proceeds—For its capital stock and surplus
Business—Insurance business.

accounts.
o

Cordrey

Aug. 15
common.

Mfg.

Co.,

Chula Vista,

capital.

Crawford Clothes. Inc., L I.

Aug.

Calif.

(letter of notification) 20,000 shares ($1 par)
Price—$1 a share. No underwriting. For gen¬

300,000

filed

1946,

City, N. Y.

($5 par) common.

Underwriters—First Boston Corp., New

stockholders.

Detroit

York.

Proceeds—Go to Joseph Levy,

amendment.

Edison

Price «f

President,

Offering date Indefinite.
Co., Detroit

(9/9)

of general refunding mortgage
bonds, series "I," due 1982. Underwriting—To be deter¬
mined by competitive bidding.
Probable bidders: The
First Boston Corp.; Halsey, Stuart & Co. Inc.; Coffin &
Burr; Spencer Trask & Co.; Dillon, Read & Co. Inc.
Proceeds—To redeem outstanding mortgage bonds, series

June 27 filed $60,000,000

1965, to repay bank loans, and for property
Bids—It is expected that bids will be adver¬
to be opened Sept. 9.

additions.

tized Aug. 29

Divco

Corp., Detroit

April 30 filed 34,963 shares ($1 par) common. Under¬
writers—Reynolds & Co. and Laurence M. Marks & Co*
both of New York. Price—By amendment. ProceedsShares are being sold by a stockholder. Twin Coach Co^

Kent, O., which will receive all

proceeds.

Cincinnati
April 28 filed 14,300 ($1 par) common shares. Under¬
writer—Van Alstyne, Noel & Co. Proceeds—Stock is
being sold by Harry R. Drackett, President (6,929 shares)
and Charles M. Drackett, 7,371 shares). Price — By
Drackett Co.,

amendment.

Pittsburgh, Pa. (9/9)
mortgage bonds.
competitive bictding.
Probable bidders include: Kuhn, Loeb & Co. and
Smith, Barney & Co. (jointly); Halsey, Stuart & Co. Inc.;
The First Boston Corp.
Proceeds—To redeem $70,000,000 of first mortgage 3%% bonds at 103V*.
The balance
will be added to general funds to pay part of the cost
of new construction. Bids—It is expected that bids will
Duquesne Light Co.,

Aug. 1 filed $75,000,000 30-year first
Underwriting—To be determined by

opened Sept. 9.
Duraloy Co.,

Scottdale, Pa.

(letter of notification) 25,000 shares ($1 par)
on behalf of the issuer, 12,500 shares ($1 par)
for the account of Thomas R. Heyward, Jr^

March 12
common
common

and

12,500 shares ($1 par) common for the account of
Thomas R. Hay ward, Jr.
Price—At market (ap¬

$3.25 per share).
Underwriter—Johnson
Pittsburgh, Pa., and The First Cleveland
Corp., Cleveland.
The company will use its proceedi
for working capital.
r
proximately
&

Johson,

Business—Mining.

Central Soya Co.. Inc.,

off indebtedness and to finance

Proceeds—To pay

expansion of business.

Mrs.

Ont.

For working capital.

Conlon-Moore

writer—No

Baby Service, Inc., New York
Aug. 18 (letter of notification) 17,419 shares of common
stock (no par).
Price—$7 per share. Underwriting*—
None.
Stockholders of record Aug. 15 given rights to
subscribe in ratio of one new share for each 10 shares

Offering is part

held. The North American Co.,

two shares for each share

Associated

To be

negotiated with a group of banks.

Aug. 11 filed 120,000 shares ($100 par) common. Under¬
writing — No underwriting. Offering — The shares are

Arnold, Hoffman & Co., Inc. (8/26)
July 22 (letter of notification) 10,000 shares ($20 par)
common.
Price—$23.25 a share. Underwriting—Cohu &
Torrey, New York. For capital improvements and for
working capital.

(N. J.)

competitive

Probable bidders include: First Boston Corp.
and Blyth & Co. Inc. (jointly); Merrill Lynch, Pierce,
Fenner & Beane and Harriman, Ripley & Co. (jointly).
Bids—Bids for the purchase of the securities scheduled

refinancing plan which the directors and manage¬
contemplated nearly a year ago when the share¬
holders at a special meeting authorized the issuance of
two new classes of preferred stock.
These new stocks
were
designed to carry a lower rate of dividend than
the present preferred stocks and the consequent reduc¬
tion in annual dividend requirements was and still is
regarded as a major objective in the best interests of
the company and its shareholders.
We look forward to
the accomplishment of this objective in the near future."

Atlantic City

underwriting.

bidding.

ment

Rights expire Sept. 30.
business expenses.

par) cumulative pre¬

Underwriters—To be determined by

ferred.

the

held.

"F," due

Oregon Power Co.

California

March 26 filed 60,000 shares ($100

ing plan. In connection with the sale privately of $35,000,000 3%%
debentures
announced July 17, 1947,
George A. Eastwood stated: "The debenture sale permits
immediate accomplishment of some of the objective of

•

Community Loan Corp., DeKalb, III.
11 (letter of notification) 4,984 shares ($10 par)
common.
To be offered to stockholders at $13 a share.

Aug.

May 3, 1946 filed 70,000 shares of cumu. preferred stock

Armour and Co., Chicago

July 12, 1946, filed 350,000 shares (no par) cumul. first
preference stock, Series A; 300,000 shares of convertible
second preference stock, Series A, and 1,355,240 shares
common stock
(par $5).
Underwriting—Kuhn, Loeb &

Francisco, is the general distributor. Price—Based on
market price. Proceeds—For investment.

selling

Union Gas Co.

(N. Y.)

eral working

Brockway (Pa.) Glass Co., Inc.
Aug. 11 (letter of notification) 5,000 shares of 5% cumu¬
lative preferred (par $50).
Price—$50. Underwriters—
None.
Proceeds—For additional working capital.
Brooklyn

San Francisco

Investment Co.,

unspecified amount of"common capital
stock. Underwriter—North American Securities Co., San

•

(letter of notification)

Commonwealth

Aug. 11 filed

•

New York

Corp.,

York, and represent 88.8% of the total outstanding
of the company.
Offering indefinitely post¬

New

Bids—Bids for the

Barium

Registration

holdings-of 1,150,000 outstanding shares of Atlantic City.
The shares remaining after the public offering will be
distributed

(745)

CHRONICLE

INDICATES ADDITIONS SINCE PREVIOUS

1946 filed 2,343,105 shs. of common (par

March 30,

plus an

Inc., N. Y.

FINANCIAL

(Continued on page 34)

Fort Wayno. Ind.

filed 90,000 shares (no par) common.
Underwriter—None. Offering—Shares initially will be

Aug.

21,

1946,

to common stockholders at
each IVz shares held. Unsubscribed
shares will be sold to underwriters.
Price by amend¬
ment.
Proceeds—Working capital, etc. Offering indefin¬

offered

subscription

for

rate of one share for

Corporate and Public Financing

Inc., New York
March 28 filed 226,454 shares ($1 par) common.
Claude

FIRST BOSTON
"

Neon,

leases.

New York

Pittsburgh

182,520 shares ($5 par) common.

writers—Harriman Ripley &
Co., both of New

Chicago and other cities
„

—The

Louisville, Ky.

York.

shares are being

Co., and Lazard

Under¬
Freres &

Price by amendment. Proceeds
sold by Corning Glass Works,

CO
dcA

ft#*:*:*#:-#

bers

BROKERS

-•/

UNDERWRITERS

B°iW"

•yo**-

DEALERS

Cohart Refractories Co.,

CORPORATION

Mar. 28 filed

Boston

Under¬
writing—None.
Offering—Shares will be offered for
•subscription to common stockholders on basis of one
share for each 10 shares held.
Price by amendment.
Proceeds—Towards cost of additional interests in oil

The

1V)D«S

itely postponed.

,to#

BOS

\S65

Sto ck

York
o
fYtU-*

c*c,°

THE

COMMERCIAL

Thursday, August 21, 1947

CHRONICLE

& FINANCIAL

of stock which was
A negotiated sale is now

Bids—No bids submitted for purchase

advertized for sale on July 29.

NEW ISSUE CALENDAR
(Showing probable date of offering)
August 25, 1947
Hajoca Corp
11

of Indiana

Co.

(CDT)

a.m.

Common

—7

Service

Public

Debentiures

Arnold, Hoffman & Co., Inc.

Common

Libby, McNeill & Libby___
Plywood Inc.

Debentures
Debentures

August 27, 1947
Potomac

Electric
Ar.

Baltimore

Power

to add to
•

August 26, 1947

Preferred

Ohio RR.

(EDT)
San Francisco Bank

Equip. Trust Ctfs.
Stock

Chicago, Pt. Paul, Minn. & Omaha

Equip. Trust Ctfs.
Common

Illinois-Rockford Corp.

Common

Preferred and Com.

September 9, 1947
Detroit

Edison

Duauesne

Co.__

Bonds

Florida Rami Products Inc.—
September

Revere Racing

Common

15,

Association, Inc

September 19,

Monongahela Power Co

1947
Bonds

1947
—Bonds

Continued from page 33)
East Coast Electric Co.
Mar. ,28 filed 60,000 shares of
$10 par common. Under¬
writers—To be determined by

competitive biding. Prob¬

Stainless

Steel

Corp., Baltimore, Md.

Aug. 5

(letter of notification) 4,300 shares of common.
through facilities of the New York
Exchange. The shares are being sold on behalf

of John

M. Curley, Board Chairman
Company.

the

stock. Underwriters—Riter & Co. and

and

President of

Edelbrew Brewery,
Inc., Brooklyn, N. Y,
31,1946, filed 5,000 shares ($100 par) 5% non-cumul.
preferred. Underwriters—None.
Offering—To be ottered
at par to
customers, officers and employees of the com¬
pany. Proceeds — For corporated
purposes including
modernization and improvement of the
Dec.

manufacturing

machinery and eauinment

•

Engineers Waterworks Corp.,
Harrisburg, Pa.
Aug. 14 (letter of. notification) $125,000 4% debentures
clue

1971. Price—$1,000 per unit.
Underwriters—C. C.
Collings & Co.; E. H. Rollins & Sons, Inc., and Stroud
and Co., Inc., of
Philadelphia. For working capital and

purchase of additional securities of other water

utility companies.
Federal

Electric Products Co.,
150,000 shares ($1 par)
Underwriter—E. F. Gillespie 8c Co..
?eb. 26, filed

Price—$7.25

share.

The

public

Newark, N. J.
common

Inc.,

registration

class A.

New

states

York.

princi¬
option

pal stockholder has granted the
underwriters an
'o purchase 45,000 shares of
class B ($1 par) common
tt $7.25 a
share, exercisable for a period of
three year*.

Proceeds—Proceeds of approximately
$870,000, together
vith $755,000 of other
bonds, will be used to repay the
Dalance of $34,000 of a
property mortgage, to pay off
loans in the amount of
$1,295,000 to Bankers Commer¬
cial Corp., New
York, and for additional working
capital.
r

stores> Inc.,

Cincinnati

July 31 filed 584,554 shares (no
par) common.
Under¬
writing—No underwriting.
Offering—Of the total 102,380

stocks

will

Wm.

offered

Filene's

Sons

exchange

for

common

Co.; Abraham & Straus,

Inc.; Bloomingdale Bros., Inc., and the F.
and
Co., all subsidiaries of Federated.
In

and

registration covered 482,174 shares
of

R. Lazarus

addition, the

common

for

tative public

ten¬

offering by 18 stockholders. These
may be
sold from time to time
at the market on the
New York
Stock Exchange.
•

Finch

Telecommunications, Inc., New York
Aug. 14 (letter of
notification) 550 shares ($1 par) com¬
mon

behalf

Wm.

G. H.
Finch, President of the
company, of which 400 shares will be
sold at $4.25 each
and 150 shares at
$5.50 each. No

underwriting..

Florida Power &
Light Co., Miami, Fla.
June 24 filed
150,000 shares of $100 par
cumulative pre¬
ferred.
Underwriters—Names to be filed by
amendment.

current
•

common

converted

date.

The

into

balance

common

will

Company has asked the SEC

prior

added

redemption
treasury funds.
on

July

Manufacturing

($1 par)
share. To be offered to stock¬
holders.
Unsubscribed shares to be offered
publicly
through Bennett & Co., Hollywood. To purchase
equip¬
ment,

liquidate indebtedness, and for
working capital.
near

future.

Iowa Public Service Co.
Aug. 6 filed $3,500,000 of 1st mtge.

—

bonds. Probable bidders:
Halsey, Stuart & Co. Inc.; Kid¬
der, Peabocly & Co. and Blyth &
Co., Inc.

First Boston

(letter
To

notification)

sold

Co., New York.

Little Falls,

Inc.,

5,000

market.

($2 par)

Underwriter—Birn-

Shares being sold on behalf

Libby, McNeill & Libby

(jointly); The
Corp.; A. C. Allyn & Co.; Harriman Ripley

(8/26)

Aug.

fund

debentures.

(by

amendment)

20-year sinking
Underwriter—Glore, Forgan & Co.
Proceeds will be used to retire $6,450,000 of outstanding
debentures, construction of additional storage space, pur¬
chase of machinery and equipment and to increase work¬
ing capital.
$15,000,000

Manhattan Coil Corp., Atlanta, Ga.
May 20 filed $500,000 5% serial debentures, due 19491957; 12,000 shares ($25 par) 5% % cumulative converti¬
ble preferred and 85,000 shares ($1 par) common.
Un¬
derwriter—Kirchofer & Arnold, Inc., Raleigh, N. C.

Price

i—The debentures at
will

each.

offered

102.507, while the preferred shares
at par and the common shares at ,$4

Proceeds—To

retire

bank

and

indebtedness

machinery and other plant equip¬
,,

Manontqueb

Explorations, Ltd., Toronto, Can*
April 10 filed 300,000 shares ($1 par) common.
Under¬
writer—F.

Winter

Co.

Price—40

cents

share.

Proceeds—For
claims.

exploration and development of mining
Business—Mining.

Mays

bonds, due 1977, and
($15 par) common. Underwriters
To be
determined by competitive
bidding for the sale of the
109,866 shs.

Manufacturing Co.,

finance purchase of
ment.

Inglewood Gasoline Co., Beverly Hills
July 7 (letter of notification) 100,414.8 shares

An amended application
may be filed in

baum &

its fi¬

Stickley Brothers, Inc., both Illinois
corpo¬
rations, and the Luce Corp. and Stickley Bros. Institu¬
tional Furniture
Co., both Michigan corporations.

Price—$1

company

two stockholders.

the sellers will receive in
exchange for their holdings
of four furniture companies to be
merged with the regis¬
trant. The merging companies are Toccoa

capital stock.

publicly will be offered to

common.

Illinois-Rockford Corp., Chicago
(9/8-12)
July 24 filed 120,000 shares ($1 par) common. Under¬
writers—Brailsford & Co., and Straus &
Blosser, Chicago.
Price—$9.25 a share.
Proceeds—The shares are
being
sold by four stockholders and
represent part of the stock

and

Falco
N.

nancing program because of present market conditions.

Co.

not sold

re¬

the

defer action

For

racing track.

develop! mining

demption of 5% cumulative convertible preferred stock
not

in payment of

underwriting.

properties. Business—Mining.

Net pro¬

applied for

Legend Gold Mines, Ltd., Toronto, Canada

Underwriters—By competitive bidding. Probable bid¬
ders include Blyth & Co.,
Inc.; The First Boston Corp.;
W. E. Hutton & Co.
Proceeds—Net proceeds from the
sale of preferred will be used to reimburse
the com¬
will be

property.

June 27 filed 300,000 shares ($1 par) common treasury
stock.
Underwriting — To be supplied by amendment.
Price—50 cents a share. Proceeds—To

Illinois Powar Co., Decatur, III.
June 17, 1946 filed 200,000 shares
($50 par) cumu. pre¬
ferred stock and 966,870 shares (no
par) common stock.

common

Offering indefinitely postponed.

to stockholders in lieu

pany's treasury for construction expenditures.

rental

officers and employees at $5 each.
Proceeds—For con¬
struction of new plants at Atlanta and
Memphis, Tenn.

financing.

ceeds from the sale of

debentures $10,000 will be issued

year's

convertible preferred

Electrochemical Co.

shares for subscription

loans.

Lay (H. W.) & Co., Inc., Atlanta
April 18 filed 16,000 shares ($50 par) 5% cumulative
and 15,000 shares ($1 par) com¬
mon.
Underwriter—Clement A. Evans & Co., Inc.,
Atlanta.
Offering—All but 3,000 shares of the common
will be sold publicly at $6.50 a share. The
preferred will
be offered to the public at $50 a share.
The 3,000 shares

Proceeds—Net

110,000 shares (no par) cumulative pre¬
ferred, series A. Underwriting—Smith, Barney & Co.,
New York.
Price—By amendment.
Proceeds—To re¬
deem outstanding shares of
$4.25 cumulative no par pre¬
ferred at $104 a share and for construction expenditures.
Reported Aug. 15 that company plans to offer 134,000
common

Manufacturing Co., Inc.,-

(Md.)

erection of harness

26 filed

of the preferred

new

Of the
first

proceeds will be used to pay obligations, purchase heli¬
copters and equipment and for
working capital.
Hooker

Harness Racing Assoc., Inc.
(letter of notification) 299 debentures in units
of $1,000, 6% cumulative, and
94,900 shares of common.
Price—$1,000 per debenture and one cent per common.

March 14 filed 270,000 shares of
capital stock. Under¬
writer—Strauss Bros., Inc., New York. Underwriters
may

June

one

Rapids, Iowa

bank

Laurel

Aug.

Helicopter Air Transport, Inc., Camden, N. J.

share.

preferred and

April 30 filed 60,000 shares ($25 par) 5% cumul. con¬
vertible preferred. Underwriter—Paul H. Davis & Co.,
Chicago. Price—$25 per share. Proceeds—To be added
to working capital and will be used in
part to reduce

Rights expire Oct. 1,

Plant-Choate

Cedar

Proceeds for construction program.

Price—$3.50

par

Hemphill,

None. Holders of common stock of record Aug. 18 will
be given the right to subscribe for the stock in the ratio
of one new for each 10 shares held.

such.

share of

Co., Winona, Minn.
(letter of notification) 60,000 shares ($1 par)
common.
Price—$5 a share. Underwriter—H. P. Carver
Corp., Boston.
To retire debt and for working capital.

Hajoca Corp., Philadelphia (8/25)
Aug. 4 (letter of notification) 6,987 shares of common
stock (par $1).
Price—$35 per share. Underwriting—

Corp.,

Koch Chemical

loans.

1947.

Boston

July 22

Noyes & Co. Offering—Underwriters will purchase from
the company 70,000 shares and from Fred P. Murphy
and J. C. Graham, Jr., 100,000 shares of issued and out¬
standing common.
Proceeds—For reduction of bank

withdraw

^lant and

share.

expansion and to reduce

Grolier Society, Inc., New York
April 2, 1947 (by amendment) 170,000 shares of $1

First

new preferred will be used to redeem
unexchanged
shares of old preferred. Bids—Bids for
purchase of stock
advertised for July 14 postponed.

short term indebtedness.

To be sold at market

Stock

The

held. Un¬

publicily at $2

with

preferred for each two shares of junior preferred. Shares
of new preferred not issued in
exchange will be sold at
competitive bidding.
Proceeds—Proceeds from the sale

commission of 25 cents

share. Proceeds—For business

conversations

each

for

Harris, Hall & Co.

(Inc.); Otis &
Co.; Kidder, Peabody & Co. The stock is being offered
by East Coast Public Service Co., parent. Bids for
pur¬
chase of the stock scheduled for
May 19 has been post¬
poned indefinitely.
Eastern

now

The underwriters will receive

common

•

share for each two

($100 par)

(jointly) toward
underwriting the stock. Offering—Preferred stock ini¬
tially will be offered in exchange for outstanding ($100
par) 6% preferred and ($50 par) junior preferred. The
basis of exchange will be one share of new
preferred

Co., Los Angeles
Aug. 11 filed 249,972 shares ($1 par) capital stock.
Underwriter
Fewel & Co., Los Angeles. Offering —
Shares will be offered to stockholders at $2 a share in

Corp

able bidders include

instituted

Biscuit

new

Working capital.

Lehman Brothers and Lazard Freres Co.

1949, common stock of the company at $11 a share. Pries
by amendment. Offering temporarily postponed.

one

Co.

cumulative pre¬
by competitive
It was announced July 25 that the company has

bidding.

stock purchase warrants to the selling stockholders at
10 cents a share entitling them to purchase up to Aug. 1,

the ratio of

for

Underwriters—To be determined

ferred.

Company has also issued 55,000

subscribed shares will be offered

October 1,

Conlon-Moore

1947

Bonds and Preferred

September 20,
Consumers Power

Common

Glass

May 9 filed 130,000 shares

—

1947

Bids—Bids

Kentucky Utilities Co., Lexington, Ky.

Offering—The 300,000 shares are
issued and outstanding and being sold for the account

Great Western

(Pa.)

Laughlin, MacAfee & Co., Pittsburgh.

Bonds

Light Co

Unsub

Proceeds—F0r

Aug. 4 (letter of notification) 420 shares of 7% cumula¬
tive preferred stock.
Price—$105.
Underwriter—Mc¬

Aug. 28, 1946, filed 355,000 shs. ($1 par) common, of
which 55,000 shs. are reserved for issuance upon the
exercise of stock purchase warrants. Underwriter—Van

of certain stockholders.

September 8, 1947

stockholder-?

Goldman

Jeannette

of its 30-

Aiatyne, Noel & Co.

September 4, 1947
Pacific Finance Corp. of Calif

McPhail Candy Corp

programs

telephone companies

Glansdar Toxtllo Corp., Now York

Common

(CDT)

Price by amendment.

construction

finance

company's

&
Co. and The First Boston
Corp. (jointly)*'
Halsey, Stuart & Co. Inc. (bond only); Harriman
Ripley
& Co., and Dillon, Read & Co. Inc. (stock
only). pr0.
ceeds—For debt retirement, finance new
construction
and for working capital.

operating in 17 states.
Business—Telephone communications.
subsidiary

the

Sachs

registered for conversion privilege of preferred. Under¬
writers—Paine, Webber, Jackson & Curtis, and Stone &
Webster Securities Corp., both of New York, and Mitchum, Tully & Co., San Francisco.

share for each five held.

Interstate Power Co., Dubuque, Iowa
May 13 filed $19,400,000 of first mortgage bonds
due
1977, and 3,000,000 shares ($3.50 par) capital
stock.
Underwriters—To be determined by competitive
bid¬
ding.
Probable bidders:
Lehman Brothers,

New York

Telephone Corp.,

new

purchase of securities expected about Sept. 16.

Aug. 19 filed 200,000 shares ($50 par) cumulative pre¬
ferred.
An unspecified amount of common also was

September 3, 1947

Acm§ Electric Corp

Inc., N. Y.

Products,

working capital.

General

Proceeds—To

Noon

Rami

offered

scribed to Sioux City Gas & Electric Co.
construction and expansion of system.

(9/9-12)
Aug. 1 (letter of notification) 100,000 shares ($1 par)
class A common.
Price—$3 a share. Underwriter—-Batkin, Jacobs & Co., New York. To purchase new machines
and equipment, to pay off some current liabilities and
Florida

will be

common

at the rate of one

possible.

Feb. 28

(J. W.)

filed

writer—Burr

Inc., Brooklyn, N. Y.

150,000 shares
&

($1 par)

cdmmon.

Under¬

Price by amend¬
ment. Proceeds—Of the total, 100,000 shares are being
gold by seven stockholders. The remaining 5O,OO0 shares
are being sold by the
company, which will use its pro¬
ceeds for general corporate purposes.
'

Co., Inc., New York.

District Court of Maine issues an order

McCormick & Co., Inc., Baltimore, Md.

(letter of notification) 1,400 shares ($100 par)
3% cumulative preferred. Price—$100 a share. No un¬
derwriting. For additional working capital.
McPhail Candy Corp., Chicago
(9/8-12)
July 25 filed 100,000 shares ($10 par) 5%% cumulative
convertible preferred and 200,000 shares <$1 par) com¬
13

^ug.

FINANCIAL

COMMERCIAL

THE

Number 2622

166

Volume

Underwriters—Brailsford & Co., and Shillinglaw,
& Co., Chicago. Price — $10 a preferred share
and $6 a common share.
Proceeds — Company will re¬
ceive proceeds from the sale of preferred only and will
use it to pay off bank loans, buy new equipment and for
working capital.
The common stock is being sold by
mon.

CHRONICLE

enforcing its

cor¬

porate simplification plan approved by the SEC last June.
The sale of stock is in connection with the plan. Aug. 15
New England Public Service Co. filed application with
SEC to change its plan to sell stock competitively and

New England has employed
Blyth & Co., Inc., and Kidder, Peabody & Co. to solicit
exchanges of prior lien stock of New Hampshire under
alternative plan.

use

alternative plan

1946, filed 100,000 shs. (500 par) capital stock.
B.
Soden, Montreal, director of
company.
Price—50£ a share.
Proceeds—For explora¬
Underwriter—Robert

(letter of notification) $200,000 3V2% serial
debentures,
due 1948-1961.
Underwriters—The First
Trust Co., Lincoln, Neb.; Cruttenden & Co., Chicago.
Proceeds—For additions and improvements, purchase of
machinery and equipment.
N. Y.

Morris Plan Corp. of America,

property.

filed $3,000,000 debentures. Underwriter—East¬
Dillon & Co., New York. Price by amendment.
Proceeds—To retire outstanding bank loans.

Mar. 31

Selected Risks Indemnity Co.,

ness.

Service Caster & Truck Corp., Albion, Mich.
April 10 filed 32,000 shares ($25 par) $1.40 convertible
preferred and 53,962 shares ($1 par) common.
Under¬
writer—Smith, Burris & Co., Chicago. Price—$25 a pre¬
ferred share and $10 a common share.
Proceeds—Pro¬
ceeds, together with funds to be provided by a term bank
loan, will be used to discharge indebtedness to Domestic
Credit Corp.
,

Mines, Ltd., Toronto, Can.
June 9 filed 460,000 shares of stock.
Underwriter—Mark
Daniels & Co., Toronto.
Price—25 cents a share. Pro¬
ceeds—To finance diamond drilling and land surveys.
•
Red Rock Bottling Co. of Pittsburgh
Aug. 15 (letter of notification) 125,000 shares (50c
common.
Price—$1.50 a share. No underwriting.
general corporate purposes.

par)
For

Silver

Musicraft Records,

Aug. 15

Inc., New York

filed 317,259 shares ($1 par) capital stock.

Un¬

derwriter—To be sold through brokers and other agents.
Offering—100,000 of the total will be offered publicly
$2.50 per share; 165,259 shares are reserved for issu¬
when, as and if stock purchase warrants issued and
to be issued are exercised, and 52,000 shares are re¬
served for issuance if certain loans having conversion
at

ance

(features shall be converted into shares of capital stock.

will not be underwritten. Proceeds
general corporate purposes. Business—Recording

I The reserved shares
-For

| phonograph records.

fund

convertible

'■

Pittsburgh,

"Pa.

Aug. 5 filed 180,000 shares ($5 par) capital stock.
Un¬
derwriter—The First Boston Corp., New York.
Offer¬

ing—Shares initially will be offered to stockholders at-,
rate of nine shares for each 11 shares held of record as

Unsubscribed shares will be offered public¬
ly through the underwriters.
Price by amendment.
Proceeds—To be added to cash funds for investment in

of Aug.

Republic Pictures Corp., New York
Registration originally filed July 31, 1946, covered 184,823
shares of $1 cumulative convertible preferred ($10 par)
and 277,231 shares (50c par) common stock, with Sterling,

25.

5, 1946, to the extent of one share for each

Reserve Insurance

Aug.

tible.

Yantis

Underwriters—F.

Inc.,

Co.,

and

Chicago.

Byllesby & Co., both of Chicago. Price—At par. Proceeds
capital.
Offering indefinitely
postponed.

Haas,
augment existing capital and surplus of

Pacific

Finance

(9/4)

California

Corp.

Association,

Racing

Inc.

(9/15)

July 29 filed 140,000 shares (no par) common.
Under¬
writer—Bonner & Bonner, Inc., New York.
Price—$5.75
a share.
Proceeds—The shares are being sold by stock¬
holders who will receive all net proceeds.
Rochester

Gas &

Y.)

(N.

Electric Corp.

May 26 filed $16,677,000 first mortgage bonds, Series L,
1977, and 50,000 shares ($100 par) preferred stock.
Underwriters—To be determined by competitive bidding.

Stuart & Co. Inc.; Blyth &

Co.,

Aug. 11 filed 150,000 shares ($10 par) common. Under¬
writer—The First Boston Corp., New York. Price—By
amendment. Proceeds—For working capital.

Inc.; Glore, Forgan & Co.; Merrill Lynch, Pierce, Fenner
& Beane; Harriman Ripley; Lehman Brothers; The First
Boston Corp. and Smith, Barney & Co. (jointly).
Pro¬
ceeds—To redeem all of its outstanding $7,675,000 bonds

•

and

Export Corp., Newark, N. J.
Aug. 14 (letter of notification) 3,000 shares ($1 par) Class
A

Pan-American

common

common.

and

23,250 warrants for purchase of Class A
Price—$2,625 per common share and warrants

to be sold

are

rant.

the underwriter at one

cent per war¬

Underwriter—Henry P. Rosenfeld Co., New York.

$3,500,000 bank loan and to finance new
construction.
Corporation has temporarily abandoned
the proposed financing, it was announced June 17, due
to "unacceptable" conditions of New York P. S. Commis¬
sion. Instead company June 18 asked SEC permission
to

repay

to issue unsecured notes.

;

Rochester

Pasco

Mining
" Canada

Montreal,

Ltd.,

Corp.

Quebec,

.*
' * •
Aug. 8 filed 333,333 shares of common, nominal value of

$1.

Underwriter—Mercer

Price—30

cents

writer receives

funds.

Canadian

share,

Co.,

Hicks

funds.

New

York.

The under¬

Canadian
exploration of mining property.

discount of 7V2 cents a share,

Proceeds—For

Plywood Inc., Detroit

(8/26
July 18 filed $500,000 5% sinking fund debentures, due
1967.. Underwriter—P. W. Brooks & Co., Inc., New York.
Price—Par with a 9% discount to underwriter. Proceeds
—To purchase all the outstanding stock of Kalpine Ply¬
wood Co., Klamath Falls, Ore., and to retire bank in¬
i

debtedness and for working capital.
Potomac

Electric

Power

Co.

(8-27)

July 10 filed 140,000 shares ($50 par) preferred, entitled
Read &

to cumulative dividends.. Underwriter—Dillon,
Co. Inc.
Offering—Stock is. offered in exchange

for out¬
standing 6% preferred series of 1925 and 5*4% preferred
series of 1927, in the ratio of two shares Of new pre¬
ferred for each old preferred share, plus cash adjust¬
ments. Exchange privilege expires Aug. 26. Shares of
new
preferred not issued in the exchange -will be sold
to
Underwriters.
Proceeds—Refinancing ths, old pre¬
~

ferred at

lower dividend rate.

Public
March

Service

Co.

•'

Indiana

(8/25)-

-filed

aebentures.

$11,077,800 15-year 2%% convertible
Offering—Common stockholders of record

were

given right to

subscribe in

the ratio of

jMU prjncipal amount of debentures for each share of
common
held.

18.
Price—Par.
*Toce6ds—For repayment of $11,500,000 of bank loan
notes., Stockholders subscribed for $9,697,800 of the deCompany is requesting bids for $1,138,000
ot the
debentures.
Bids will be received up to 11 a.m.
tCDT), Aug. 25, at company's office, 110 North Illinois
Rights

expired

Aug.

street, Indianapolis.
j

hxr

Service Co. of New Hampshire

,
at
'
New

^65,553

eommon shares (par $10), now owned
Public Service Co., filed with SEC.

England

.number of shares and terms of offering

determined by New England as soon as the U. S.

Telephone Corp.

(N. Y.)

67,500 shares ($100 par) cumulative pre¬
ferred. Underwriting—By competitive bidding. Probable
June

filed

bidders—Merrill

Lynch, Pierce, Fenner

& Beane and

Kidder, Peabody & Co. (jointly); Blyth & Co., Inc.;
Glore, Forgan & Co.; Shields & Co. Proceeds—To redeem
4^% series A first cumulative preferred, pay off de¬
and for property expansion and conversion
system from manual to automatic dial oper¬
ation in Rochester.
Bids—No bids submitted for pur¬
chase of the stock when advertised Aug. 5.

mand notes,

of telephone

•

Russell

(F.

Co.,

C.)

underwriting.
Slocan

Charleston

Under¬

ings, windows.
Salant & Salant,

Inc.. New

York

($2 par) capital
Underwriter—Eastman, Dillon & Co., New York.
by amendment.
Proceeds—Shares are being sold
stockholders who will receive proceeds.
28

filed

240,000

stock.
Frlje
by la

Canada
Aug. 4 filed 250,000 shares ($1 par) capital stock.
Un¬
derwriter—Mark Daniel, Toronto.
Price—50 cents a
share (Canadian funds).
Proceeds—For corporate pur¬
Santa

poses.

Maria Mines,

Ltd., Toronto,

Business—Mining.

Seaboard Finance Co.,

•

Los Angeles

amount

common

be issued upon

exercise of the
It also will sell

privilege of new preferred.
$1,250,000 of 4% subordinated notes, due 1951, to Mutual
Life Insurance Co., New York,
Underwriter—The First
Boston Corp., New York.
Offering—New preferred will
be issued in exchange for outstanding class A and B
conversion

preferred stocks.
Shares of new preferred not issued
exchange will be offered publicly.
Price—For pub¬

lic

offering to be

supplied by amendment.

preferred and for
ness—Personal finance business.
To redeem old

Seattle, Wash.
500 shares ($100 par)

•
Sno-King Theatres, Inc.,
Aug. 11 (letter of notification)
common.
Price—$100 a share.

underwriting. To
for purchase
real estate contract, ani
No

complete construction of Drive-in Theatre,
of

equipment, pay balance on
to retire present obligations.

Development Corp.,

Southeastern

Jacksonville,

Fla.

July 29 (letter of notification) 8,000 units consisting of
one share
($10 par) 6% cumulative preferred and- one
share ($1 par) common.
Price—$12.50 per unit. Under¬
writer—Southeastern Securities Corp., Jacksonville. For

•

Southwest

Inc., McNary,

Lumber Mills,

Ariz.

(letter of notification) 40,000 shares ($1 par)
capital stock. Price—$7.50 a share. To be offered to
stockholders. Any shares not purchased by stockholder3

Aug.

To restore working

Can.

Strauss

Montreal,

Imperial Trust Co., Ltd., of

will be bought by

Fasteners

capital.
Inc.,

New York

cumulative con
Underwriter—Floyd D. Cerf Co. Inc.
Chicago. Offering—The shares initially will be offered
for subscription to common stockholders of Segal Lock
& Hardware Co. Inc., parent, at $9 a share in the ratic
of one share of preferred for each 30 shares of Seea
common held.
Unsubscribed shares of preferred will bt

March 25 filed 25,000

shares of 60 cents

offered publicly at

$10

share. Proceeds—For

additional

working capital.

Taylorcraft, Inc., Alliance, Ohio
(letter of notification) 30,000 shares ($10
common.
Price—$1.0 a share.
No underwriting.
manufacture of light aircraft.
•

Aug. 15

•

Tennessee

Drugs,

Inc.,

Fur

Chattanooga, Tenn.

notification) 25,000 shares of

Aug. 13 (letter of

pa')

preferred
preferred

10,000 shares of common. Price—$11 a
share and $1 a common share. One share of common wi
be furnished for each 10 shares of preferred subscribe]

paid for. No underwriting, the stock possibly
through a brokerage firm. Working capital

and

be sold

manufacture of drugs
•

wi 1

for

and lotions.

Gas Transmission Co., Chicago
$40,000,000 of first mortgage pipe lin*
due 1967, and 100,000 shares ($100 par) cumula¬

Tennessee

Aug.

bonds,

filed

preferred. Underwriters—Stone &
and White, Weld & Co., New

tive

ities Corp.,

Webster Secui
York. Price b'

Proceeds—To finance new construction ar-u
$7,500,000 of outstandnig notes. Business—Oper¬
of natural gas pipe line from Texas to West Vir¬

amendment.

ginia.
•

Texas

Co., New

York

unspecified number of common (par
$25) shares (maximum number, 2,248,932 shares). Un¬
derwriters—No underwriting. Offering
Shares will boffered at below the market price for subscription U
stockholders.
Price by Amendment. Proceeds—To ta
added to general funds for corporate purposes. Business
14 filed an

Aug.

—Oil refining.

Textron Inc.,
Feb. 28

Providence, R. I.

filed 300,000 shares

convertible
York
Los Angeles. Price by

($25 par) 5%

preferred. Underwriters—Blair
and Maxwell, Marshall & Co.,

& Co., Inc., New

Proceeds—For payment of $3,950,000 oi
purchase of two notes issued by a_sub¬
sidiary, Textron Southern Inc. in the amount of $h
000,000 each, and for working capital. Offering date

amendment.

bank loan notes;

indefinite.

shares ($50 stated value) convert¬
preferred. Company also registered an unspecified

Aug. 20 filed 100,000
ible

Kaslo,

Ltd.,

Co.,

Mining

Columbia

tle, Wash.
Price — 50 cents a share.
Proceeds — For
mining equipment, development work and for working
capita. Business—Mining.

ation

common.

amendment. Pro¬
ceeds—Shares are being sold by stockholders who will
receive proceeds. Business—Manufacture of metal awn¬

March

not more than $100.

For additional working capital.

Aug. 13 filed 200,000 shares ($1 par) common.
Under¬
writers—Elmer J. Edwards and Van Tine, both of Seat¬

repay

Cleveland

Aug. 20 filed 113,678 shares ($1 par)
writer—McDonald & Co.
Price—By

5% sinking

maximum of 66,666

and

For expansion.
•

vertible preferred.

due

Probable bidders: Halsey,

debentures and

working capital.

par)

company.

—To be added to working

Co., Chicago

(letter of notification) 30,000 shares ($5
Price—$10 a share. Underwriting—Ray T.

common.

Revere

Louisville, Ky.
Mar. 31 filed 50,000 shares ($20 par) 5% convertible
cumulative preferred and an unspecified number of ($1
par) common shares into which the preferred is conver¬
Poindexter Distillery,

five held.

Issue not to be underwritten.

securities.

Old

to be
Sept.

Corp.

$300,000 of

will be offered to the public at

Company decided to issue

underwriters.

454,465 shares of common stock only, which were
offered for subscription to stockholders of record

Precision

cents par common for conversion of de¬
Price—$95 per debenture to be offered to
stockholders. It is contemplated that after Sept. 2 they
of

British

business.

Y.)

(N.

bentures.

•

Refrigerated Cargoes, Inc., New York
Feb. 3 filed 25,000 shares ($100 par) 6% cumulative pre¬
ferred and 25,000 shares (no par) common. Underwriter
—John Martin Rolph, Vice-President and director of
company.
Price—The stocks will be sold at $105 per
unit consisting of one share of preferred and one share
of common. Proceeds—To be used in organization of

Grace & Co.

•

National Union Fire Insurance Co. of

Creek

Aug. 13 (letter of notification)

man,

•

Branchville, N. J.

(letter of notification) 7,500 shares of capital
stock (par $110). Price—$35 per share.
Underwriting—
None.
Establish reserves as result of increasing busi¬

Aug.

•

Raleigh Red Lake

Aug.

Quebec Gold Rocks Exploration Ltd., Montreal
Nov. 13,

tion and development of mining

Corp., Auburn, I nd.

Messenger

•

instead.

Bolger

Russell McPhail, President.

(747)

Proceeds—

working capital. Busi¬

Thomascolor Inc., Los

Angeles

class A common.

July 9 filed 1,000,000 shares ($5 par)
Underwriter—No underwriting.
Pnce—$10
Proceeds—To purchase production facilities

share.
and

working capital.

Specialty Corp.,
filed 75,000 shares ($10 par) 5%

United

July

convertible
& Co.,

Utilities &

preferred.

cumulative

Underwc'ty_¥?"lcSLyfnder.
IVice—SlOashare.Theun

Inc., New York.
receive a commission

writers will

Boston

of $1.50 per snaie. xu

(Continued on*page

36)

THE

(748)

COMMERCIAL

•

(Continued from page 35)

American

Dutch and German interests in American Bemberg
and
of

Utah Chemical & Carbon Co.

Co., Inc., Boston.
share.

per

•

Price—Debentures 98; common $3.75

for

and

working

Registration

capital.

American

statement became effective June 28.

Mines, Ltd., Toronto, Canada
500,000 shares ($1 par) common.
Under¬
writer—Name to be filed by amendment. Price—50 cents,
a share.
Proceeds—For general operating expenses.

rangements for

Inc.

Debentures

will

not

Dec.

Proceeds—To retire preferred stock
and to reduce bank loans.
Reported July 16 that the
present plans will be entirely changed.
•

Westvaco Chlorine Products Corp., New York
Aug. 18 filed 30,000 shares of $3.75 cumulative preferred
and 30,000 shares of
common, both without par value.

than

15, 1967.

share.

dated

earlier

date

subscription rights.

will

•

issue of

stockholders

the year is out to

The

Wire Industries of
California, Inc., San Fran.
Aug. 13 (letter of notification) 1,500 shares ($100 par),
cumulative 6% preferred. Price—$100 a share.-No un¬

derwriting.
stalation

•

coupon

filed

May 21,

1946

covered

550,000

RR.

capital expenditures made.
Probable bidders include
Halsey, Stuart & Co. Inc.; The First Boston Corp.; Drexel.
& Co.
•'
•"

York,

•

common

Minnesota

Mining &

Manufacturing Co,

office, 2 Wall Street,

■/

i.'

.v'-

(9/19)

Aug. 11 company asked the SEC for authority to issue
competitively $7,000,000 30-year first mortgage
bonds and 40,000 shares ($100 par) cumulative
preferred
and sell

(9/3)

stock.

$1,560,000 equipment trust

Monongahela Power Co.

certificates, Series V, to be

Chicago, St. Paul, Minn. & Omaha

•

Aug. 10 reported company has under discussion financ¬
ing which may involve $20,000,000.
Probable under-writers: Goldman, Sachs & Co.-;
Kidder, Peabody & Co.;
Piper, Jaffray & Hopwood. "
'

1, 1947, due $560,000 each Sept. 1, 1948-57.

Bids for the purchase of

shares.

•

to noon (EDT) Aug. 27 for the purchase

dated Sept.

•

owns

(8/27)

of $5,600,000 equipment trust

Wisconsin Power & Light
Co., Madison, Wis.
July 30 (by amendment) 10,000 shares of common stock
(par $10) to be sold by Middle West Corp. The original
statement

Baltimore & Ohio

New

which

•

Proceeds would be used for
construction purposes and to reimburse the
treasury for

offer the stock publicly.

Bids will be received at company's

For acquisition of small dry winery and inequipment for bottling wines.

Philadelphia,

Corp.

bidding

bonds,. series due 1977. The
rate and the offering price would be determined,

by the successful bidder.

Corporation

Investment

Metropolitan Edison Co.

$4,500,000 first mortgage

capital expenditures.

•

Amra

stock, with

underwriters.

Aug. 19 company filed an application with SEC
request¬
ing permission to issue and sell at competitive

25,000 shares of Amra Corp, stock, contemplates before

•

Liberty Loan Co.

•

Underwriter—F. Eberstadt & Co., Inc., New York. Price
by amendment.
Proceeds—Complete soda ash mining
facilites in Wyoming and construction of a soda ash
plant. Business—Production of industrial chemicals.

r\r*

No details of amounts or purposes fur
rumors are that company will raise between

Sills, Minton & Co.

six shares held.

debentures for each

$100 of

Proceeds—For

offered

Corp.

nmnnnfo

Aug. 16 reported company contemplates issuance
of
100,000 shares of 5% convertible preferred

15, 1957 and not later than

Laughlin Steel

$80,000,000 and $120,000,000 mainly for plant improve"
ment and additions. Sale of any new securities probably
will be effected privately through The First Boston Corp

1947 with maturity ;

15,

new financing.

Convertible at not exceeding $150 per

Debentures

ratio

Dec.

Jones

nished but

approximately $354,000,000 convertible debentures, with
interest rate of not less than 2%% nor more than 3%.-

stockholders. Certain shareholders have waived

common

ims

Aug. 15 company confirmed reports that it is
considering
nPW
finanrincf
ISJn Hernia rxf

Oct. 15 stockholders will vote on authorizing an

($5 par) common.
Under-,
writers—Blair & Co., Inc. and Wm. R. Staats Co. Offer¬
ing—Shares will be offered for subscription to Weber's

thS

■

Co.

Shoe

Telephone & Telegraph Co

American

Weber Showcase & Fixture Co.,
Mar. 31 filed 108,763 shares

financing.

at a later date. Arunderwriting of a part of the proposed issue have been made with a group managed by
The First Boston Corp. and Harris, Hall & Co. (Inc.),

Dufault

Mar. 31 filed

offering of $11,000,000 of preferred
stock

finance expansion but decided not to
proceed with

offering will be determined

such

Vauze

Brake

planned

and

Aug. 15 William B. Given, Jr., President stated that the
company contemplates the offering to common stockholders early in October of new convertible preferred
stock
(oar $100) authorized last April.
The terms of

Proceeds—For plant construction, purchase

equipment

•

Underwriter—Carver &

the debentures.

transferred

interest

Co.

common

Reported the value
S. Government is about

Rutin, Loeb & Co., Lehman Brothers
Glore, Forgan & Co. reported to have account.

convertible debentures
due 1962, and 225,000 shares ($1 par) common. The state¬
ment also covers 112,000 shares of common reserved for
of

Alien

North American Rayon Corp.

$15,000,000,

Dec. 20 filed $700,000 5% 15-year

conversion

Office

Electrochemical

Aug. 15 reported company is planning to offer 134 Onn
shares for subscription by stockholders in rati!
of one neware for each live owned. Smith, Barney &
Co. pr
e: under OTiters
Thecompany recently

Property has taken over the
Corp.

addition, they will be granted warrants to purchase 50,000 shares of the issuer's common at $5 a share.
Pro¬

Hooker

•

Corp.

Bemberg

ceeds—For additional working capital.

Aug.

Thursday, August 21,
1947

CHRONICLE

FINANCIAL

cer¬

Probable

bidders include

and The First Boston

W. C. Langley & Co.
Corp. (jointly); Lehman Brothers;

tificates to be dated Oct. 1, 1947 and due $15,600 annually

Oct. 1, 1948-57 will be received up to noon (CDT)

Prospective Offerings

Harriman Ripley & Co. and Lazard Freres & Co.
(jointly)

(bonds only); Glore, Forgan & Co. (bonds only); Halsey
(bonds only). Blyth & Co. and Gold¬
man, Sachs & Co. (jointly); Merrill Lynch, Pierce, Fen-

Bros.

Government,

State, Municipal

••

•

include

Halsey,

(Inc.); Salomon

Co., Jackson, Mich.

filed with the SEC

rate not to exceed 2%%.

through

construction

1949

improvements

steam-electric

Tom

spend

to
and

may

generating

Lake Erie in the southeast

ST. LOUI8

corner

plant

of Michigan.

Com¬

expects to advertize for bids Sept. 12, to be opened

•
Young Radiator Co., Racine, Wis.
Aug. 16 reported company contemplates issuance of com¬
mon
and preferred stocks involving about
$1,700,000,$
with Sifl?, Minton & Co. as underwriters.
>

CLEVELAND

SAN

•

FRANCISCO

Probable bidders include:

Morgan Stanley &

Co.; Halsey, Stuart & Co. Inc.; Ljehman Brothers; Whitet
Weld & Co.; W. C.

Langley &

V'.'

•

')■

'•

-.M '

ment

Leading the World in Achievement
(Continued from

14)

page

herculean

effort will have to be
made by the people, the
Congress
and the Executive Branch to
bring
the expenditures down to a

figure

of between $25 and
$20 billion
which appears to be a
likely ob¬
jective for our post-war peace¬
time budget level.,
,.

This

I President exercised his veto. Only
once before in the nation's
history
had a President used his veto on
a

tax

bill.

filled with clashes
the purse strings.

structure

may

with

its

1944 and

makes

gress has

collect

Our

clear

the power

taxes

and

control of

over

own

con¬

Branch.

cal

policy required

definite pro¬
gram of debt reduction. For
this
I

reason

such

fight
where

year

was

belief
tion

then

and

providing
we

could

duction,
The

It
is

for

was

now

debt
some

that

reduc¬
tax

low

housing

can¬

that.

problem,

maintain

will yield

and

revenue

the

our

provide for

will

passed

tax

twice

the

collec¬

course,

yet
a

huge

leave

system

necessary

room

for

budget and

same
a

produce

satisfac¬

tory solution.
This nation is too
economic

large and its

re¬

time it

dynamic

flourishing

free enterprise system
under which the
debt burden

may

Government

private

are

too

capital

interest

present

belief

concerning
will only be

funds

rates

cost

that

at
not

are

construction

can

ex¬

ident's

For

The Labor Relations

It should be apparent to every¬
that our national well being

one

and
a

our

national

large extent

functioning of

security rests to

upon

the continual

our economy.

munici¬

tween management and labor the

Federal

and

the

tions Act of 1947.

destroys

ing to take moderate profits and

rights

through able management develop
ways of producing more at lower

apparent. At this session de¬
spite the pleas of many of their
friends in Congress they refused
to

tolerable
of

the

wanted

any

sense

of the fundamental

of labor.

was

supported

passed by

equal share of responsibility with

both

are not

priced out of employ-

The

veto

than

was

the

an over¬

overridden

two-thirds

houses...More

government,

than

vot$
a

drivers
be

our

economic

i^ignjvay,

they management, oi; labor.

The

conspiracy to, circumvent
labor legislation on, the

new

part of labor organizations find
some
business
organizations

was

public

enacted

and

members

one

those

the

out

rights

teaming

the

union
abuses

Wagner

right

Act.

barter

away.

If it
appears

certain

the

protect the

individual

from

has

The

against sound public policy;

ma¬

jority of the members of the Pres¬

in labor

the industrial warfare hit and run

law

The bill

management

they

They
their

upon

growing

seeing to it that

restraints

organizations
responsibility must always be a
corollary to power.
The people
have a right to establish traffic
signals in our economy so that the
oublic W'1! "ot
riwv ^7
by

business at

century.

power.

ident.

jurisdictional

of big

of. the

Congress and vetoed by the Pres¬

have

the

leaders

turn

whelming vote of both Houses of

they

the in¬

growing out

secondary boycott.
Their position was not unlike that

unit costs. Labor must increase its

that

solve

conditions

use

construe-'

any

strike and the

productivity in the building trades
realize

forth with

come

tive amendments to

the

It in

bill.

and

; *

were

Congress passed the Labor Rela¬

states
Government.

ganized labor and their allies in
Congress
refused * to - permit
amendments to the Wagner Act
even
though obvious inequities

business

Act

private

palities,

party

leaders of or¬

In order to protect the
public
interest and bring a balance be¬

labor,

12 years the

Whether
.

housing is that it
solved by the cooperative action of

industry,

Democratic

own

voted to override the veto.

pedited.
.

dency to "pass the buck" to Wash¬
ington.

available, sufficient public funds

com¬

plex to be effectively or efficient¬
ly operated out of the nation's
capital. There is too often the ten¬

see

can

problems

Private industry must be will¬
to

that

sums

substantial debt

duction while at the

bills

The

tions will be larger than that.
Our

able

re¬

Reduction Veto

Twice the
Congress
reduction

along
with
municipalities
in
Congress passed no major hous¬ working out incentive taxation for
ing legislation at this first session. low cost housing, while the Fed¬

ready

cover

give
,,

Tax

carried

vote.

give assistance

get were $37 billion.

the

could

provided

reduce

overwhelming
after

States

Senate

floor

carried

this

tion.

been

the subject. Only
Congress, the same 80th Congress,

can

materials used in home construc¬

Housing Problems

reasonable

the

there

When

nnS £?bt by not less than $2,600,000,000

legislate

modern
existing

for

ample

tax relief by the veto but he
not

substitutes

socialist government of Britain or
the
communist
government
of
Russia with all their power have

funds

still deny

can

and ; discourage

cost

that short supplies are not drained
out of
the country and that if

amendment to

program.

the

President

low

levy and

that

nopoly

tion to this problem can be found
on the Federal level.
Neither the

1939, when taxes were al¬
high, the -collections
amounted to $5,200,000,000.
The
early estimates for the 1948 bud¬

the

joint
the legislative
budg¬

defeated

was

proposed

committee
et

so.

time they

same

Con¬

that

ary, the
that sound fis¬

soundly do

can

codes while at the

discard codes that encourage mo¬

eral

1,039 principal
appropriated except as
parts.
The
whole provided
by
law.
While
the
mechanism cries for
President's constitutional right to
streamlining
and the 80th
Congress recognized use the veto is not questioned,
the necessity for such
action by strong
American precedent has
the passage of the
Lodge-Brown supported the supremacy of the
Resolution setting up a
bi-partisan Congress in the field of taxation.
commission on organization of
the
When Congress meets in Janu¬
It seemed to

by high costs. Municipalities
can contribute^ greatly by enforc¬
ing their health and sanitation

I have grave doubts that the solu¬

component

Executive

are

rapidly

long struggle for Parlia¬
mentary Government has been

only be brought about
major revamping of our
overgrown complex governmental

was

easily. Excessive
perhaps the greatest
handicap to our country's dynamic
growth and must. be reduced as
taxes

The

stitution

can

This

Congress had overridden it.

be carried

(8/27)

Clark, Attorney General of the United States,
invites bids for the purchase, as a
whole, of 20 shares
of common stock (par $1,000) «
(five-sixths paid).
The
shares constitute approximately 1.666% of the outstand¬
ing capital stock of The San Francisco Bank, 526 Cali¬
fornia Street, San Francisco, Calif.
Bids for the shares
must be presented at office of Alien
Property Depart¬
ment of Justice, 120 Broadway, New York
5, N. Y., on
or before noon
(EDT) on Aug. 27.

Bonds will be

Company plans

San Francisco Bank

(9/22)

series bear^

(bonds only); Kidder. Peabody & Co.; and
Weld & Co.
(jointly).
Bids expected about

White,
Sept. 19.

statement covering

& Beane

ner

•

CHICAGO

PITTSBURGH

bidders

competitive bidding.

Sept. 22.
•

Power

company

start

YORK

BUFFALO

PHILADELPHIA

Stuart & Co Inc.

Hutzler.

$100,000,000

pany

BOSTON

Probable

Inc.; Harris, Hall & Co.

ing interest at

NEW

Co.

$25,000,000 30-year first mortgage bonds of

*> Co.

INC.

Aug. 1

and

sold

Consumers

Corporate Securities

Blair

Chicago.

St.,

son

Stuart

United States

Sept.

3, at office of R. L. Williams, President, 400 West Madi¬

that "big
with

business"

"big

labor"

THE

Number 2622

166

'Volume

COMMERCIAL

They work hard but are well
prices and working condi¬
cared for.
It is in no sense, as
that small business, the
some
articles have tried to indi¬
! public and individual employees
are at
the mercy of such com¬ cate, a "panty-waist" outfit. There
is discipline but it is the type that
binations, then the full power of
comes from
good leadership and
the Federal Government should
not from driving,
swearing ser¬
be used under the existing anti¬

fix

trust

be necessary.

stated

such modifications

laws or

may

occa¬

numerous

during my campaign last
fall and since then on the floor
of the United States Senate that
no one has the right to strangle
the economic life of one hundred
and forty million Americans.
During the time the labor rela¬
tions bill was before the Senate I
voted against and helped defeat
a
number of amendments that I
believed
were
too restrictive.
During the 79th Congress I voted
against the President's proposal to
draft strikers into the Army.
Despite the threats of political
annihilation by some top bracket
labor leaders, regardless of almost
daily villification by the com¬
munist spokesmen, the "Peoples
World" and the "Daily Worker,"
the members of Congress voted for
a
bill they believed was in the
best
interests of the American
people and of the rank and file of
organized labor itself.
It is my firm belief that repre¬
sentative
government functions
best when the legislators get the
facts, vote their convictions and
let the chips fall where they may.
This I have endeavored to do as
sions

and
United States Senator.
Legislator

State

the

Army.
me they had
joined the outfit in a skeptical
frame of .mind.- They, too, had
served during the war at home
and overseas.

the

I have

will

creation

now

and delin¬

Oaks

make

of the men were high

proud to have

my son

in such

outfit, associated with other
Americans

other.

cooperation and coordination that
was lacking at Pearl Harbor.
Both to assure our national se¬

age

from

the

Summer

Dumbarton
of

1944

first draft of the Charter.

are

equal

If world opinion can

evolution.
United

Nations

Influence

Concrete National Policies
The United Nations
in

this

much

way

be used

can

than

our

It ought to be
normal that major international
policies which create fear or re¬
sentment anywhere should be sub¬

church

the

control

form

Neither the Baruch
any other satisfactory

international control

accomplished
exists

in the security

can

long as

long

no peace

can

the

coun¬

of mind

potential violator of

atomic

regulations can use the
action by the sup¬
porters of international law and

veto to prevent

order

ican secret in the
ments

and

blue

is not
sense

Amer¬

that docu¬

prints

can

dictatorship

the

Assembly as a place where the
representatives of all States, big
and little, would meet and discuss

problems of international re¬
lations. and where even the great¬
est nations could be required to

anv

submit their conduct to the judg¬

The

ment of world opinion.

con¬

ception of justice was introduced
and the Assembly was authorized
to

against the aggressor.

Atomic power

military

ence

atomic energy.

proposal

Turkey,

was

The recent Soviet action

establish

human

agencies to

welfare.

The

promote

San

Fran¬

cisco Conference saw peace, not as
condition of enforced stagnation,

gary

not

was

in Hun¬

characterized
Most

consider

the

comparable.

Americans
two

policies

the
as

We believe that

locked in

physically fit
have military
to be able to

man
shall
training in order
help defend his country

young

the need

There

ever

should

arise.

opponents to
the proposals who think this will
interfere with the "rights" of our
are

some

young citizens. I think we should
also consider the "obligations" of

citizenship.
Having served in the Army for
three years as an enlisted man
and an
officer, and as the father
of a 17 year old son, I would be
less than frank if I did not admit

that I did have
reservations

some

few

mental

the

regarding

pro¬

Fort

gram.

Ten

days ago

went

Knox, Kentucky, where the
perimental
I

was

UMT

little

that I >wa's

the

unit

ex¬

located.

surprised to find
first member of

cither House of Congress who had
haade'a personal inspection.

t ate' dinner and breakfast with
the

young men in their mess with¬
officers being present. I
talked''to them in their barracks
out any

under the

same

reveille 'with

their elkss

conditions. I stood

them

rooms

and

attended

and field work.

I talked
ito their officers and

their

I spent
some considerable time with the
Catholic and Protestant Chaplains

hon-commjssioned cadre.

and with the information and edu¬

cation officer.
The morale of the young
mentis
excellent. I. have. seen few emits
with more pride in their outfits
J

than have these UMT hneh.

•"

earth.
I

have

the public verdict of right

war,

discussed

wide

range

and

wrong

public questions with you with
complete frankness. I realize that
on many of these questions there
is an honest difference of opinion.
But it seems to me that the times

effect.

require candor on the part of
men holding positions of responsi¬

The

exercises
United

three

begun

show how,

powerful

Nations has

in time of

public opinion can exercise
powerful effect,
At the San
Francisco Conference and at the

peace,
a

subsequent Assemblies of
the United Nations political lead¬
ers
from many lands have pre¬

Those

foundations

not yet world-wide,

there

are

con¬

many inadequacies,

tably as
practiced.
people

arp

On the

About
the

no¬

discrimination

race

80%

is
the

have

world

tested institutions of self-govern¬

Some, like

judgment ought not.

national judgment, but an
international
judgment.
From

to be

the standpoint of the United Na¬

tions,
both

the significant fact is that
policies
increased
tension

between

As such,
of merely
national concern—it became im_pressed with an international in¬

great nations.

each policy ceased to be

upon

the tested foundations of
political

ters the final

every

world

President Wilson

States, are only now moving from
dependency to full independence.

foundation.

which *

available

oolicy destroyed a small nation's
independence.
But in such mat¬

and

structure

the

ment.

world

outweighs

government's policy was de¬
signed to preserve small nations'
independence
and
that
Soviet

our

but
as
a
condition of healthy
terest.
safe, and this in itself
The United Nations Charter pro¬
will assure protection to our peo¬ growth.
How the United Nations Works
vides that the Assembly may dis¬
ple. We must face the cold real!
The
United Nations has now cuss any situation, regardless of
adequate Air Force, Army and ity that within five years it is not
been functioning for over a year origin, which it deems likely to
Navy. It will be costly but not j unlikely that other nations will
! have made such a bomb. Our and a half and the Assembly is impair friendly relations among
nearly so costly as not having the
nations.
The situations referred
insurance. I have seen the terri¬ only alternative, as unpleasant as shortly to hold its fourth meeting.
it may seem to some, is for-the It has revealed great possibilities. to surely qualify under this pro¬
tory of three defeated and occu¬
The United States should
United States to keep no less than Of course, it has not settled every¬ vision.
pied powers. As long as I have
five jumps ahead.
Indeed, the international welcome, not resent, any move to
When others thing.
a
voice and a vote I will not
have a "model T" we will have situation is gravely troubled.
But out its action in Greece and Tur¬
knowingly contribute to the re¬
much later types far more potent the United Nations has shown that key on the agenda of the Assem¬
mote possibility of such a thing
for discussion.
The same
than the Hiroshima or Nagasaki it need not be a mere spectator. bly
happening to our nation.
It can do something.
It can call should be true of the Soviet Urn on
models.
There is still pending before^ a
These
.Until" adequate guarantees can every natioh's international acts in relation to Hungary.
Senate
committee
and
on; tne
be established I am unalterably to the bar of public opinion, with matters are being discussed else¬
House calendar. the
Universal
wherever men talk of
Opposed"to the" surrender of any confidence that that will have where,
Military Training Bill. This bill of our atomic "know how" to
peace.
Why should they not be
any healthy practical consequences.
provides that between the ages of
discussed at the "town meeting of
We have seen how. in time of
other nation on the face of the

to fulfill our obliga¬
tions under the "United Nations
Charter
we
must
maintain an
and

curity

create

trary, free societies represent only
about 20% of the population of
the world, and even within them

has been made

international

words.

looked upon by the
Soviet Union as unfriendly to it.

legislation at the next session.
progress

fine

liberty.''

bring about early passage of such
Little

said, "peace must be planted

outrageous.

merely

ample,
the
so-called
"Truman
Policy," in relation to Greece and

So, the San Francisco Confer¬
radically changed the plan
of Dumbarton Oaks.
It empha¬
sized the United Nations General

can

created

They depend on human founda¬
tions, and it is not practicable to

It did largely prevail at
the San Francisco Conference of

prevail.

President of the United States

Nations

physical force. So they. worked, the compatibility of such policies
hard to make their point of view with peace and justice.
For ex¬

arise.

what

United

were
politically stupid or reac¬
tionary.
It is because they knew
that political institutions are not

the

The

Charter did not attempt to repro¬
duce those processes.
That is not
because the authors of the Charter

yet the practice.

three big powers.

shall

Feasible

each

the Republic should the need ever
I

World Government Not Yet

the

equal

people did not jected to the scrutiny of the
think
much
of
an
organization Assembly.
The Assembly might
which would be primarily military even,
by a vote of confidence or oi
and which would depend chiefly
non-confidence, pass judgment on
But

nation, prepar¬ 1945, thanks in great part to the
ing
to
fulfill
their
obligations small nations which did not want
as
citizen-soldiers in defense of to be' placed permanently under

the Unifica¬
of the Armed Services Bill. It
do much to bring about the

same

young

met

they

all sections of the

veto

already mentioned that

the

things

en¬

quencies were but a small frac¬
tion of what one might find among
a
like group of 600 young men
of 18 years of age.
I came away with no mental
reservations whatever. I would be

The

process.

that

thing

same

program.

when

the Congress passed
tion

were

the

over

(749)

Of course the United .Nations
bring
That was a first great decision. the
foreign policies of the differ¬ processes of which I speak are
It
remained
to
be
decided ent nations toward
harmony with elementary and inadequate. Some
what kind of an organization it the world's moral judgment, then societies
have much more elab¬
would be.
those policies will automatically orate
procedures for enabling the
Many
thought that the new move toward harmony with each moral force of the community to
world organization should be pri¬ other.'
keep order and assure peaceful

morals

now

Services

Armed

Both

that they would seek the
of a world organization.

axiom

15)

(Continued from page

marily a military organization to
perpetuate the existing war alli¬
Chapel attendance has increased ance.
That was the conception
in both the first group that com¬ which dominated the representa¬
pleted their six months training tives of the Soviet Union, Great
and in the second group which is Britain
and
the
United States

thusiastic

cil. There
The

old

Both Chaplains told

your

geants

CHRONICLE

The Task of World Peace

tions so

FINANCIAL

which was especially
designed to make discussion pro¬
the world,"
ductive

peace?

is afraid to have its

If any nation
international

policies discussed, that is good
proof that thev ought to be dis¬
cussed.
In
the
Assembly
the
sponsors
of
questioned
policies
would explain them and welcome

Some

colonial

the

are

dependent

peoples.

Some, like the
peoples of India and certain Arab

the

Indonesia

and

strife.

peoples of China
in

are

chaos

and

Some live under constitu¬

tions

which, in words, vest sover¬
eignty in the people, but in fact
they are ruled by a small group
which

perpetuate

themselves

subject to change bv

power

lution.

Some

rule

victors.

the

under

are

Some,

revo¬
war

the

Russian people and others within
the orbit of Soviet influence, are

governed by dictatorships which
call themselves
"dictatorship oi

the proletariat."
To

develop free

long, hard
perfected.

societies

It is nowhere
But with all their de-i

process.

fects, the free societies represent

something precious in the world,
They

best

reflect

the

Christian

concept of the nature of
his

relationship

fellow

man,,

man

Thev

anc

and

God

besj;

assure
progressive
peaceful
change toi
what may,
from time
time,
seem
the greatest good* of the
greatest number.
They best as¬
t

that government will be re¬
sponsive
to
enlightened
moral
judgment.
It would not advance
sure

if
a

subjected

free

societies

world government which to¬

day could not be other than des¬
potic. That would sacrifice a liv¬

ing hope to the lure of

mirage.

Development of International
Processes

an expression of the confidence of
This is no time for gener¬
I do not concludd that present
matters. the Assembly. The verdict would
alities or pleasant platitudes.. „;,' sented. views on, many
be accented
not have any legal consequences. inadequacies should
Always' the speakers were ob¬
There are many in our nation
as
permanent.
On -the contrary,
But
an
unfavorable
judgment
who doubt our capacity to carry viously conscious of the fact that
would doubtless influence the fu¬ they should be remedied and they
on
in the face of the problems they were talking to representa¬
can
be. remedied, though not ail
tives of some two thousand mil¬ ture of the condemned policy and
ahead. I have no such doubts. It
at once.
In the United Nations
lion people, of whom many mil¬ make more likely its modification
is my strong belief that the mas¬
Security Council the veto power
lions personally followed, by press or abandonment. No nation, how¬
ters of the Kremlin are making
should
be
curtailed.
The
veto
and
radio, what was said and ever strong, will lightly defy a
a mistake when they "sell Amer¬
ought not to apnly to administra¬
done.
Every speaker presented verdict which seems to reflect the tive matters.
ica short" and look forward to
Also, no single na¬
his case with regard to what he informed and aroused moral judg¬
our
collapse so they may with
tion should be free to block an
ment of mankind.
leisure gather other peoples be¬ thought was world opinion and he
We have had this week a strik¬ investigation of the facts or the
tried to get its backing. - Almost
hind the iron curtain.
The Dutch carrying out of particular inter¬
always the different governments ing demonstration.
national policies which have been
No, America will not fail. No
presented their positions other¬ stayed their military hand in In¬
longer an adolescent among na¬
The biggest task, how¬
donesia in response to the call of agreed to.
tions we have come of age.
We wise than they would have done
ever, is to improve the founda¬
had they been meeting in secret the United Nations Security Coun¬
tion.
The western democracies,
recognize our possibilities and our
That was not because the
and if world opinion were not sit¬ cil.
obligations, at home and abroad.
largely through ■, the »inflence of
United Nations could have com¬
Twice
in
my
generation Old ting in judgment. That is a fact
Christianity, have developed for
pelled them, for it has, as yet, no
of
great moment.
It does not
themselves free political institu¬
World dictators have pictured us
make future war impossible.
It military contingents and no police tions. But
as a decadent democracy, unable
they have not built
force.
Indeed,* it is not certain
can make war less likely.
to mobilize our resources or our
broadly enough. It is that deficit
You may recall the school book that the Security Council resolu¬
which is the most serious limiting
manpower.
Perhaps if they had
tion was legally in order.
But
factor.
It is that deficit which, as
not so miscalculated there would
that
resolution
registered
the
have been no World War I or II. and distributing more rather than
rapidly as possible, must be made
moral judgment of a large portion
good.
Let no such mistake be made following the socialistic system of
of mankind.
That was the essen¬
dividing what already exists. The
again,
tial fact and it was that fact which
Summary of Task
Within our hands we have the years ahead are as great a chal¬
the Dutch Government respected.
Let us now seek to summarize
power to lead the world to new lenge to the young men of Amer¬ The Indonesian
situation is far
the
task
and
the opportunity
paths of achievement. Under our ica as was the frontier to our from being settled.
But at least
constitutional government and our forefathers. All we need to do is we have one more illustration of which lie before us.
to pull together instead of pull¬
First, we must see, as most do
capitalistic free enterprise system,
how wnrld opinion can influence
In this Atomic Age,
I '
we^will increase the standard of ing aoart.
(Continued on page. 39). >

bility.
»

lining of

...

our

people by producing

dare

not fail.

national conduct.

THE

(750)

COMMERCIAL

CHRONICLE

FINANCIAL

Thursday, August

Indications of Current Business
The following statistical tabulations cover production and
shown in first column are either for the week or month ended
Latest

AMERICAN

IRON

Indicated

AND

steel

STEEL

operations

INSTITUTE:

(percent

Week

capacity).

Aug. 24

Week

92.8

93.2

that date,

or,

Latest

93.1

89.7

BANKERS

ingots

DOLLAR

ACCEPTANCES

ING—FEDERAL

castings produced

and

(net

tons)—.

.Aug. 24

1,623,900

1,630,900

1,629,200

NEW

1,580,900

RESERVE

YORK—As

Imports
AMERICAN PETROLEUM
Crude

oil

Crude

runs

INSTITUTE:

output—daily average

of 42

gallons each)__.

Aug.
Aug.

5,104,500

5,045,350

Gas oil

5,184,000

5,229,000

5,784,000

output

(bbls.)

Aug.

16,163,000

16,197,000

(bbls.)

16,517,000

output

Gasoline

Kerosine

Aug.

1,964,000

2,043,000

2,194,000

15,156,000
1,899,000

and

Residual

stills—aaily

distillate

fuel

oil

(bbls.)

average

fuel

oil output
(bbls.)

output

(bbls.)

Aug.

Gas

(bbls.)

Residual

oil

and

fuel

oil

(bbls.)

6,004,000

5,909,000

8,582,000

8,679,000

(bbls.)

84,898,000

85,645,000

88,791,000

87,186,000

18,562,000

16,057,000

17,111,000

49,545,000

17,665,000
*48,574,000

49,057,000

53,531,000

53,107,000

45,261,000
50,529,000

51,925,000

freight loaded (number of cars)
Revenue freight rec'd from connections (number of cars)
ENGINEERING

CONSTRUCTION,

Aug.
Aug.

ENGINEERING

Total

905,244

921,591

806,961

692,757

694,195

531,398

Private

Manufacturing

Public construction
State and municipal.
Federal

—

$57,401,000

24,425,000

$109,768,000
47,943,000

$104,350,000

$129,096,000
101,189,000
27,907,000
24,817,000
3,090,000

51,195,000

32,976,000

61,825,000

53,155,000

27,030,000

45,245,000

39,084,000

OUTPUT

CO.

BUREAU

5,946,000

16,580,000

14,071,000

coke

service

—

DEPARTMENT

STORE

SYSTEM—1935-39

Aug.

SALES—FEDERAL

11,750,000

—Aug.

Not avail.

Aug.

♦11,700,000
1,126,000

Not avail.

131,300

*6,100,000
1,008,000

Electric output

1,255,000

51,200

222

*220

Total

liabilities

228

CROP

•t.!

4,923,000

4,874,172

4,732,434

4,422,242

(COMMERCIAL

STREET,

AND

INDUSTRIAL)—DUN

INC

IRON AGE

COMPOSITE

PRICES:

Finished

steel (per lb.)—
(per gross ton)
Scrap steel (per gross ton)*

Aug. 12
Aug. 12
—Aug. 12

3.19141c

$40.42

2.70711c

$36.38

$36.52

2.88239c
$33.43

$28.13

(bu.)
Buckwheat

$19.17

$131,000,000

2,659,949
1,427,747

3,287,927

1,435,551
1,092,122
343,429

1,155,715

48,018

281,822
35,836

295,411

245,986

1,223,624

2,612,809

286,365

S.—U.

17,991,000
8,640,000

45,734

21,389,000

332,099

1,247,454
284,867
25,219

1,509,867

DEPT.

of Aug. 1:

—

_____

___;

1,095,648
*

(bu.)

$37.75

Rye

_______

25,405

(bu.)

•

„

(bu.)
i
(bu.) __1
Sorghums for grain (bu.)
Hay, all (ton)
Hay, wild (ton)
Hay, alfalfa (ton)
Hay, clover and timothy (ton)
Hay, lespedeza (ton)

Electrolytic
I

'71

(E.

M. J.

QUOTATIONS):

copper—

Domestic

refinery
at
Export refinery at
Straits tin (New York; at
Lead

(New

Lead

(St.

Zinc

York)

21.225C

21.225c

21.425c

21.250c

80.000c

80.000C

14.150c

21.175C

16.025c

52.000c

15.000c

15.000C

8.250c

Aug. 13

80.000C

Aug. 13

Louis)

(East St. Louis)

Aug. 13
Aug. 13
Aug. 13

14.800c

14.800C

8.100c

10.500c

10.500C

8.250c

Aug. 13

10.500c

1!^

:i k

Govt.

Average

;

Bonds

122.55

122.05

121.70

123.39

117.20

117.00

118.40

.Aug. 19

121.88

122.09

122.92

120.22

■

A_—I—III———————"Aug.

V
\nti

Baa

Railroad

r;1

Public

Group

Utilities

120.22

120.63

116.80

117.00

116.61

118.20

Aug. 19
*

110.15

109.97

112.56

Aug. 19

—

Group

112.56

112.00

115.24

Aug. 19

118.60

•118.60

119.00

120.43

120.63

120.84

121.46

Aug. 19

1.51

1.54

1.57

1.52

Aug. 19

118.60

Aug. 19

Industrials Group

i'l;

Sweet

-Aug. 19
-Aug. 19

corporate

Aaa

2.79

MOODY'S BOND YIELD DAILY AVERAGES:
U.

Aaa

ft 1'

Aug. 19

—

______

Aug. 19

Hops

2.55

2.64

2.80

2.73

2.55

2.51

2.64

2.62

Group
Industrials Group

34,330

6,990

100,860

11,530

6,870

16,145
6,239

7,182
15,797

•

6,926

•

187,906

—L__.

196,725
-

2,036,430

361,793

351,674

475,969

60,238
&

sugar

seed

61,897

66,807

2,126,477

2,101,154

2,312,080

6,420

6,702

(ton)

12,086

'___

5,997

11,888

10,562

•

49,520
PUBLICATIONS

•

53,282

53,171

RETAIL

PRICE
INDEX JAN. 2, 1931=100
(COPYRIGHTED
AS OF AUG. 1)—
index

124.1

goods

Home

2.80

2.82

2.74

Piece

3.16

3.17

3.03

3.06

2.89

2.72

2.70

Cotton

117.4

79.5

85.1

113.2

109.9

168.1

Woolens

108.2

130.7

167.5

145.0

115.7

Silk

3.03

;

121.7

131.2

114.1

furnishings

113.3

120.4

122.0

wear

106.6

120.6

______

children's

121.4

79.1

2.81

115.1

120.1

121.7

apparel
Women's
apparel
Infants'

123.7

120.4

Men's

Aug. 19

—

31,817

33,198

6,544
'

(ton)

FAIRCHILD

Aug. 19

Group

Utilities

33,434

16,366
:

(lb.)

Aug. 19

—

Public

2.56

103,182
13,428

33,149

(ton)

Broomcorn

Aug. 19

Baa
Railroad

Su^ar beets

106,737

13,406

(bu.)

(lb.)
Sugarcane for

7,105

33,710

v—

potatoes

Tobacco

Piece

93,190

2,136,895

(bu.)

18,685
22,962
71,520

75,485

103,232

(lb.)

Composite

Bonds——^

Govt.

Average corporate

74,885

•

dry edible (100 lb. bag)
Peas, dry field (100 lb. bag)
Soybeans1 for beans (bu.)
Potatoes

263,350
.

38,374..
.

Beans,

Peanuts

MOODY'S BOND PRICES DAILY AVERAGES:

873,893

8,931

Rice

METAL PRICES

1*1

$243,000,000 *$234,000,000

Flaxseed

*$41.67

i*■«,

$3,434,000

■

20,989,000
11,844,000

v—

Spring
Oats (bu.)
Barley
(bu.)

Pig iron

$18,982,000

YORK—^

(bu.)
(bu.)

Durum

162,000

413,000

$37,137,000

NEW

—_—_

(bu.)

Spring

76,000
835,000

610,000

bales

Other

if,

AGRICULTURE—Estimate

All

Aug. 14

31.

Corn, all
(bu.)
Wheat, all (bu.)

BRAD-

$1,948,000

OUTSTANDING—FED¬

PRODUCTION—U. S.
AGRICULTURE—As of Aug. 1.

Winter

FAILURES

July

PRODUCTION

.Aug, 16

1,874,000
1,614,000
664,000

_____________

PAPER

$14,220,000

2,280,000
384,000
19,863,000

ACREAGE AND

DEPT.

283

2,144,000

RESERVE BANK

COTTON

112,300

228

299

$12,466,000

liabilities

Production,
Aug.

(in 000 kwh.)

Construction liabilities
Commercial service liabilities

EDISON ELECTRIC INSTITUTE:

I''

12,312,000

RESERVE

AVERAGE=100

number__.

liabilities

—

36
___;

number

ERAL

(tons)—:

-$205^381^

Total

MINES):

Bituminous coal and lignite (tons)
Pennsylvania anthracite (tons)-

Beehive

$182,517,000

number

Wholesale number
Retail number

COMMERCIAL
COAL

40,000

9.276,000

Retail

6,061,000

11,422,000
14,217,000

BRADSTREET,

Manufacturing liabilities

Aug.
-Aug.
Aug.
Aug.
Aug.

construction

6,664,000

nnn

23KS

between

$187,344,000

BUSINESS FAILURES—DUN &
INC.—Month of July:

899,086
700,227

NEWS

construction

shipped

Wholesale

1,000

ll',286^000

and

$146 452

45,722,000
10,622,000
9,347,000
1,000

Total

Commercial

RECORD:

stored

foreign countries

Construction

Revenue

4"""-

—_

goods

r_^

Aug.

ASSOCIATION OF AMERICAN RAILROADS:

CIVIL

$110,764,000

45,056,000
9,439,000

credits

exchange

Based

7,995,000

Aug.

oil

Dollar

Ago

$114,898,000
_

warehouse

Year

July 31:

shipments

Domestic

5,517,000

8,757,000

Aug.

fuel

5,932,000

Aug.

distillate

Aug.

Stocks at refineries, at bulk terminals, in transit and in
pipe lines—
Finished and unfinished gasoline
(bbls.) at
Kerosine

BANK

—

Domestic

4,821,450

5,087,600
5,271,000

Month

OUT¬

Exports

(bbls.

Month

Ago

Equivalent toSteel

month available (dates
are as of that
date) :

of quotations,

cases

Year

Month

1941

Activity

other figures for the latest week
on

Aug. 19

2.63

2.62

2.61

2.58

goods—

wash

goods

Domestics—

Sheets

MOODY'S

NATIONAL

ITY

fr!
I

INDEX.

FERTILIZER

INDEX

.Aug. 19

ASSOCIATION—WHOLESALE

Fats
Farm

and

—*

Aug. 16

Livestock

222.0

222.5

185.1

180.0

187.8

200.1

223.8

259.0

257.1

219.0

329.4

344.4

365.0

341.0

Miscellaneous

—*

Building

materials

■

Fertilizers

249.9

244.5

182.4

180.1

178.6

154.2

164.8

165.8

162.1

146.0

.Aug. 16

—

218.0

220.5

222.5

158.8

149.0

221.3

187.0

177.4

149.8

151.2

127.5

Aug. 16
____

„

PAPERBOARD

f •'

Production

•ft

135.4

129.8

129.5

121.4

135.0

121.4

127.1

126.6

115.1

206.8

206.4

202.3

174.7

Percentage of activity
(tons)

IIII

;

WHOLESALE PRICES—U. S.
DEPT.
All commodities

i ;i
!

!
I

Fuel and lighting materials.
Metal

;
products

Building materials
Chemlcals

and

Housefurnishing

133,950

163,034

505,183

610,459

.Aug.
.Aug.
.Aug.
-Aug.
-Aug.
.Aug.
.Aug.
.Aug.
.Aug.
.Aug.
.Aug.

33T333T
products!- "~

156,766

173,527

allied

products

goods

Miscellaneous commodities

.Aug. 14

metal

139,288

174,180

488,283

494,554

140.4

141.3

142.7

136.4

Underwear
Hats

152.2

151.3

148.3

180.8

178.2

171.1

165.8

176.5

174.5

173.3

139.5

138.3

114.6

109.7

105.8

96.6

146.7

146.1

141.6

178.0

113.5

176.6

175.4

116.9

117.5

131.4

131.0

Furniture

116.8

114.6

.Aug.
.Aug.

—

clSSi!!68 °^er ^an farm"Frod~ucts333333Z33333I!
3 .T
farm oroducts and foods

▼laed

figure.

}No

market previous

quotation

21.225c.

166.4

165.6

162.0

147.1

145.7

147.2

142.2

110.4

.Aug.

147.2

146.0

143.7

.Aug.

145.9

121.3

144.8

141.8

.Aug.

135.2

119.3

134.7

132.1

110.8

131.3

'149.2;

72.9

DEBT

GOVT.—As

face

95.7

94.3

107.3

94.5

LIMITATION
of

amount

outstanding
Outstanding-

July

may

one

time

$275,000,000,000 $275,000,000,000 $275,000,000,000
259,447,739,778

258,286,383,109

79,971,276

89,520,185

268,270,022,261

gross

public

guaranteed

debt

•

Total

110.8

119.8

31:

that

any

67.7

96.0
108.3

appliances

120.6

STATUTORY

333,227,821
'

and

obligations

___

$259,527,711,054 $258,375,903,294 $268,603,250,082;

Deduct—Other

outstanding public
obligations not subject to

debt
debt

limitation

879,611,568

^84,487,234

■»

960,589,345

$258,648,099,486 $257,491,416,060 $267,642,660,737
Balance

materials

Manufactured products

140.4
164.1

73.3

zz
household

China

101.7

106.8

141.0
;

103.3

164.6

coverings

Radios

114.6

110-7

128.6

113.4

116.0

110.9

111.6

98.2

131.8

146.5
125.9

128.9

Shoes

132.4

116.9

107.5

125.6

;

138.3

139.0

110.7

94.4

114.4

wear—

face

amount

issuable

under

obli¬
above

authority

...

•w*

children's

Socks

118.1
100.4

105.3

114.6

Underwear

144.0

130.3
112.6

147.2

Infants' &

162.3

168.0

131.1

Shoes

127.1

181.2

108.3

105.0

Clothing including overalls

Floor

S5.0

119.5

112.4

neckwear
caps

gations

Semi-manufactured unities
.avvuicu articles"
All

i__—,

102.5

Hosiery
Shirts

154.6

110.5

119.7

apparel—

143.2

111.5

110.9

Men's

113.4

111.8

_!___

90.0

138.9

122.6

143.4

—

82.7
151.8

122.5

Shoes

Bpecial groupsRaw

Total gross
public debt
Guaranteed obligations not owned
by the Treasury

LABOR—1926=100:

____

Hides and leather
Textile products
and

206,732

135.5

152.3

Underwear

Total

Farm products
Foods

169,653

3—" .Aug.

31131111—-.! .Aug.
3_3IIII333333"'
.Aug.

133.1

143.2

82.4

Electrical
9

167.2

143.3

Luggage
Aug.

DIL, FAINT AND DRUG REPORTER
PRICE
INDEX—1926-36 AtERAGE=l06

;}

124.4

ASSOCIATION:

(tons)
(tons)

Unfilled orders

h -

205.4
-

Orders leceived

i: i

149.7
129.7

311 .Aug.
!
3" .Aug.
3311— .Aug.

machinery

NATIONAL

221.9

.Aug. 16
.Aug. 16

»_

All groups combined

!■
:*>

Farm

204.2

249.7

159.1

*—

drugs

Fertilizer materials

210.6

Chemical and
■

251.9

■

Metals

257.2

Aug. 16

commodities

Textiles

% A-

260.8

.Aug. 16

Fuels

223.9
257.4

.Aug. 16

167.3

apparel—

& house dresses
Corsets & brassieres
Furs

Aug. 16
.Aug. 16

Women's

comfortables

Aprons

.___

349.7

Hosiery

■

t ^
1

418.5

.Aug. 16

oils

products

Grains

425.1

COMMOD-

r •;

f ;L

421.8

Blankets

GROUP—1935-39=100:
■

'■

COMMODITY

UNITED

STATES

RECT

July

General

Net

AND

$16,351,900,514
GROSS

DEBT

$7,357,339,263

GUARANTEED—As

Fund

$17,508,583,940

DI¬

Balance"

Debt

Computed Annual Interest

Rate

$259,527,711,055 $258,375,903,294 $268,603,250,082
->
3,068,793,567
3,308,136.929
12.028,942.105
256,458,917,488
255,067,766,365
256,574,307.977
2.116%

2.107%

2.008%.

THE

Number 2622

Volume 166

COMMERCIAL

dividuals who

Half of Foreign Dollar Bonds

qualities 1 of

in full

$2,255,399,950

50.04% of the total of $4,507,084,749 of publicly offered foreign
dollar
bonds
The slight decrease in propor¬
outstanding
tion of bonds serviced in full from
on
JDec.
31,
50.77% in 1945, despite resump¬
1946, accord¬
on

bul¬
entitled

"Statistical

due

tion

to a

ing

letin

interest

number

Analysis
of
Publicly
Of¬
fered Foreign
Dollar Bonds"
issued
by
Dean John T.
Madden,
Di¬
rector of the
Institute
o f
International
Finance of
New
York

bonds
Data

fully

the

re¬

partial default.

status of all pub¬

the

December 31,1946

December 31, 1945

qualifies
tasks of

(000,000)

$2,469.0

" 50.77

2,277.8

'46.84

$2,255.4'
2,145.1

So it is

need,

100.00"

$4,863.1

——

2,36

faulted

and

$4,507.1

100.00

bonds,

accounted

19.8%,

end of

at the

of total defaulted

ter

bonds.

respectively, while German is¬
sues
represent
57.9%
of ■ total
European defaulted bonds. At the
end of 1946 Latin America ac¬

foreign dollar bonds in default as
to interest on
Dec. 31,
1946, is

32.7%

total

geographical distribution of

The

shown in the following

de¬

East

Bonds

(000,000)

701.8
1,148.9

515.5

288.8
5.5

been created

the

churches

Churches

raising large
restoration funds to help churches
elsewhere.
Missionary activity is
reviving. Two great international
church convocations are planned
—one

0.2

are

for 1948, one for 1949.
The Urgency

good enough.

The present rate of

will

movement

not

quickly pro¬
duce a powerful impact on world
affairs.
The need is urgent. We
are dealing with
the typical war
cycle. The first phase is war. The
phase

vAt
the

end

the

Eastern

moral

tice and

righteousness.

North

American

defaulted bonds

of to¬

amounted to less than Vz%
tal outstanding

were

while

of slip back into the

An analy¬

bonds.

and
depart¬
7.3%; and municipal¬

provinces
for

ments

durable peace.
are

war

Second, we must also see, as
m£ny do not see, that it is ineffec¬
tual merely to oppose war. Oppo¬
sition

war

successful

can

only as it also develops new in¬
stitutions for coping with inter¬
national problems.
!,

Third,

Nations

must see the United
a
place where the

we
as

frioral conscience of the world can

drive

policies
and

into

nations

the
of

following

righteousness

justice,

concord.

Fourth,

bility

of
be

done

the possi¬

see

international

improving

procedures.
can

must

extent this

some

within

now,

the

framework of the United Nations.

Major .improvement requires, in
the World, more societies of free¬
dom.!

Fifth and

finally,

must act

in the light of what we see.
i

Special Christian Responsibility
This great audience meets as a
Christian audience.
I appeal to
you

ters "the
world

In all of these mat¬

fcuch.

Christian

carry a

of the

people

special load of re¬

sponsibility.
What is the need?
for

men

what

The need is

and women who

now

and

what

can

see

be.

Christ put particular emphasis on
vision and light. He taught men
to see
w*v

tred,

truly and to avoid the hahypocrisy
and
selfishness
vjl

cixxvjl

irv#

vj.ac

aXc-l

men

warp

tion.

expect but that mankind

their

use

rigidities

and

new war.

be just and

At the moment

time for moral

the

Rubber

Association,

Flint,

the

effective
The moral

is for more

moral power.

law, happily, is a universal law.
it is reflected by many great reli¬

Even without religion there
is general agreement on "right"
and "wrong" in their crude and
obvious aspects.
That fact is of
immense value.
It is why, even

gions.

disillusioned.

has filed

The need is to
a

founda¬
adequate world

build the

organization. That
world

of free

foundation is a

societies, and free
(

society depends,

those hear¬

collusive

arrangement, but
is

method

illegal

the contrary

marketing steel

products which has evolved

over

the

past 50

years

natural consequence of the funda¬
mental economic and

competitive

George

DIVIDEND NOTICES

Assistant

KENNECOTT COPPER CORPORATION
120

the colored film producers and the
Eastman Kodak

Company.

cash

se\enty-five

the

Federal

record

called

been

that

statement

re¬

previous attacks had

made

system "without

the

basing

k^ |

business

August

Corporation

<#£!

DIVIDEND

The Board of Directors declared
of 35<i

per

dividend

the Common Stock

able September II,

pay¬

1947, to holders of record

August 29, 1947,

HACKNEY

ROGER

Treasurer

The Garlock

in law."

Packing Company

opinion," Mr. Olds said,

our

now

August 19, 1947

against the subsidiaries of

COMMON1 DIVIDEND No. 285

basing

made

point

charges

United States Steel by the Federal
have

Commission

Trade

basis

Johns-Manville
I

point

basis in fact

the

Trade

Olds, Chairman of the U. S. Steel
a

1947

15,

A. S. CHEROUNY, Secretary

Institute, Irving S.

N. Y.

1947,

steel companies and the American

Corporation,

cents

Commission's charges against the

Iron and Steel

York

(75c)
a
share have today
been declared by Kennecott Copper Corporation,
payable on September 30, 1947 to stockholders
of

Regarding

New

distribution of twenty-five cents (25c)
and
a
special cash distribution of

29,

Olds Answers Charges

Broadway,

August

anti-trust suit against

fact

in law than the

meeting of the Board of Directors,
this day, a quarterly dividend of

held

25(£

per

stock

mon

was

declared

the

com-

Company, payable

the

September V0, 1947, to stockholders of

NOTICES

DIVIDEND

record at the close of business

Septem¬

ber 20, 1947.
R. M. Waples, Secretary

The Board of Directors of

&>)

MFG. CO.-

PITTSBURGH

PREFERRED DIVIDEND NO. 4

quarterly dividend of eighty-one and
(S.81 H ) per share on
8%% Cumulative Convertible Pre¬
ferred
Stock, $100 par value, of this
Company,
has been declared, payable
September 5, 1947, to stockholders of
record at the close of business August
21, 1947. Transfer books will not be
closed. Checks will be mailed,

CONSOLIDATION

one-quarter cents

COAL

•

m^turn, on in-

COMPANY

the

meeting held today, declared a quarterly
dividend of 35 cents per share on the Com¬
mon
Stock
of
the
Company, payable on
September 12, 1947, to shareholders of rec¬
ord at the close of business on August 29,
at

1947. Checks will be mailed.

HAWKINSON,
Secretary-Treasurer.

August 11, 1947'

Charles E. Beachley,

Secretary-Treasurer
August 19, 1947

ALUS-CHALMERS
MM

MFG. CO.
DIVIDEND NO.

COMMON

regular quarterly dividend of forty
cents ($0.40) per share upon the issued
and outstanding Common Stock, without
A

eyes were

opened to

them.

before

If many

today

lie
are

value, of this company, has been depayable September 30, 1947, to
of record at the close of
business September 11, 1947. Transfer
books will not be closed. Checks will he

par

elared,

REEVES BROTHERS, me.

stockholders

lethargic, it is only because they
do

not

see

what,

if seen, would

surely stir them to eager action.

May God give us the vision to
see

DIVIDEND
A

HAWKINSON,
Secretary-Treasurer,

been declared,

the

ability

August 11, 1947.

the close of business

September 3,

1947.

books

The

transfer

Box

M 814,

"Commercial & Financial

N. Y.

the

Company will not be closed.

plan wisely

Chronicle," 25 Park Place, New York

share has

payable October 1,

1947, to stockholders of record at

clearly. Out of that vision will

come

NOTICE

of 25c per

dividend

and the will to act

moral

for

and

association's

would quickly pass if

that mood

world-wide influence.

tion

dustry is not

The Department of Justice also

But

strongly. Thus
concepts can have
But Chris¬ may we become a living part of
tians believe that, through Christ,
that Tree
of Life
whereof the
the moral law has been revealed
leaves serve the healing of the
with
unique clarity.
Christians
nations.
ought, therefore, to be especially
qualified to form moral judgments
which are discerning and to focus
situation wanted
them at the time and place where
they can be effective.
The need is for full use of the
present great possibilities of the
WANTED!
United Nations. It was Christians
most of all who wanted a world
A Job—ANYTHING, but prefer trad¬
organization which would depend
ing, syndicate department, or statis¬
primarily on moral, rather than
tical work—but mainly a job.
Ma¬
physical power.
They have it.
ture;
registered representative New
Now it is up to them to generate
York
Stock
Exchange;
member
the moral power required to make
STANY; disabled veteran; wishes a
the organization work.
JOB—ANYTHING! ! ! !

today,

vaca¬

the immense possibilities that

need

Manufac¬

Secretary.

people feel tired and to

extent

some

will only men's

stumble?
The

testified

Further effort is imperative.

vision, what can

duce the needed

was

be broken.

This is

If Christians do not pro¬

visions.

"It

ings that the basing point practice
prices in the steel in¬

of delivered

try."

turers

the

and

cycle where, most readily, it

Of course,

blind

which

Committee in 1939 and 1940.

ident

in the particular phase of the

war

(Continued from page 37)
that under modern conditions
is an intolerable institution.

basing point hearings before
the Temporary National Economic

conditions existing in that indus¬

ities for 9.1%.

The Task of World Peace
£.

itself

cycle which must be

broken if there

can

see,

accusations

commission

corporate bonds for 40.6%;

43.0% ;

the

Wilson, Goodyear
Vice-President; A. L. Viles, Pres¬

phase is moral relaxation,

victory

letting the international situation

sis of interest defaults by types

states,

The third

Latin obligors shows- that bonds of na¬ stagnation which breed
of the Far tional governments account for That is
the

interest,

as.

unfounded

advanced
our

fervor,

phase

100.00

$2,145Jf

similar

mounting to win victory for jus¬

53.6

56.0%
outstanding

and

bonds

default

82.5%

1946,

60.1%

European,

American
in

$4,507,0

—-

dent;

"the

fourth

.Total

page

Rubber

"In

All of that is good, but it is not

second

13.5

1,432.4

„

$orth America

(Continued from

there has

32.7

$1,167.1
1,392.0

America

Europe
Far

Defaulted

Default

(000,000)

table:

Per Cent of Total

Amount in

Amount
Outstanding

Latin

play their clearly in¬

organization,

1946 for

13.5%

for

to have
If Chris¬

International Affairs. The Ameri¬

counted

ought

consequences.

are

Council

practically
un¬
Latin
American obligors ac¬ changed from Dec. 31, 1945. Eu¬
counted for 86.3% of defaulted rope's percentage increased from
bonds. Of the total Latin-Amerr 51.2% at the end of 1945 to 53.6%
The Far East
ican bonds in default, Mexico and on Dec. 31, 1946.
Chile account for 34.0 and

analyze the
responsibility
inescapable fact.

as we

dicated part, they must have bet¬

can

On Dec. 31, 1946 European

discharge

interrupted by war. Al¬
ready under its auspices and those
of the
International
Missionary

50.04
47.60

106.6

2.39 :

116.3:

principal

: Total

that,

emerges as an
It is a fact. that

tians

Christian

Commission
'

Christians

world-wide import.

ization,

Percent

Per Cent

New Anti-Trust Moves

So,

good.

common

Churches is completing its organ¬

(000,000)

Debt service paid in full-In default as to interest
In default as to sinking fund

the

of practical

table:

University.

payment

for

unity of
and
more
licly offered foreign dollar bonds action
emphasis on
as of
Dec. 31, 1945 and 1946 are Christianity as a world religion.
To some extent, these things are
summarized
in
the
following
happening. The World Council of

Madden

total

was

cancellations

and

purchases

Dean

and

exceeded

bonds

serviced

during the

maturity

before

and

issues,

that

fact

amortization

year

defaulted

the

payments

and

(751)

Co., Akron; U. S. Rubber
Co., New York City.
Also, J. L. Cochrum, Seiberling
again, Christians have the great
Vice-President; I. Eisbrouch, Day¬
responsibility.
ton Rubber
Vice-President; A. A.
The need
is for effort on a
Garthwaite, Sr., Lee President; H.
world-wide scale.
The Christian
H. Hawkes, U. S. Rubber Assistant
church is a world-wide institution.
General Manager; Lee R.
Jackson,
Christianity is not a national or Firestone Executive Vice-Presi¬
regional religion, nor a class re¬
dent; L. A. McQueen, General
ligion nor a race religion.
It Tire
Vice-President; J. J. New¬
transcends every known human
man, Goodrich Vice-President; R.
difference.
That fact peculiarly S.
Wilson, Goodyear Vice-Presi¬
tion

analysis of publicly offered foreign dollar bonds in U. S.
1946 debt service has been paid

exemplify Christian
self-control

brotherhood, and who treat
freedom
not as
license, but as
occasion for voluntary coopera¬

John T. Madden of New York University issues statistical

CHRONICLE

human

Paying Full Interest
Dean

FINANCIAL

J. M.

REEVES, Treasurer

August 20, 1947

American Cyanamid
Company
PREFERRED DIVIDEND
The Board of Directors
can

of Ameri¬

Cyanamid Company on August

1947, declared a quarterly divi¬
dend of eighty-seven and one-half
19,

cents

($.875) per share on the out¬
shares of the Company's

standing

3Va%
Series

Cumulative Preferred Stock,
A. payable October 1, 1947,

to the holders of such

close
tember 4, 1947.

ord

the

BRICCS & STRATTON

stock of rec¬

CORPORATION

of business Sep¬

COMMON DIVIDEND
The Board of Directors of
can

82nd DIVIDEND

Ameri¬

Cyanamid Company on August

19, 1947, declared a

quarterly divi¬

dend of twenty-five cents ($.25) per
share on the outstanding shares of
the Common Stock of the Company,

payable
holders
the

October

1947,

the

of such stock of record at

close of

business September 4,

1947.
W. P. STURTEVANT,

Secretary

The
a

Directors has declared
twenty-five cents (25£)

Board of

dividend

share and an extra dividend of
twenty-five cents (25£) per share, less
2.75 per cent Wisconsin privilege divi¬
dend tax, on the capital stock (without

per

par value) of the Corporation, payable
September 15, 1947 to stockholders of
record August 29, 1947.
L.

August 19, 1947

Regner, Secretary

COMMERCIAL

THE

CHRONICLE

& FINANCIAL

Thursday, August 21, 1947

Investment Firm of

Oh! For Such a Prophet to Lead Us!
always listened to my warnings.
good attention to this now. I offer you no
easy passage. An intense struggle for life will have
to be made by all. Many will be wounded and faint

•

Please pay

\/ykf u

JL C9U

jOLffLlA/

from the Nation's Capital

•

Beliind-the-Scene Interpretations

Lloyd E, Ganady & Go.

"You have not

Washington

fall

our

RALEIGH,

with

our

hope—or fear—on Attorney General Tom Clark's
boast he aims to throw into jail those parties conspiring to hike food,
clothing and housing prices. Neither the Attorney General—nor his
White House boss—expects to frighten prices lower with the jailer's
keys. They know, as most of us do, that current high prices aren't
of conspiracy origin.

t":
I

waste

•

will

—and

get—is

And

i"''

long.

That's why he took

I' 1

the

•'

the

tention

publicity

White

the

chore
The

House.

The

simply

you're

Messrs. Truman and

Clark, here's a practical word on
xprices from Charles A. Burmeister, Agriculture Department econ¬
[T

odd years, who has

charted

supply and demand with
than political mo¬
tives. Says Mr. Burmeister
"If the corn crop continues to be
damaged by droughts, consumers
who think they are paying high
prices for meat now really have
a surprise
coming next summer
when meat prices will probably
jump as much as 25% over pres¬
honest

V'i

two

actually be

taxation

Ways

}ll)
I

maintained

Bureau

,'■<

by the
Agricultural
Eco-

been

months
small

1865

definitely prove
serious spoilage of

has

t"M

since

nomics
each

followed
later

meat

normally
means

corn

about

and

ab-

prices.

consumers

beef
►

until

just

and

retail

This

can

stores

grocery

before

April,

1948,

gradual price hikes there¬

after to

peak between August
and October. That's how Econ¬

omist

Burmeister

historical

often and

projects

formula

into

this

1948.

Two

committeemen

the probe

Clark

even

ob¬

servers.
*

claims

can

grow

with jailers and news head¬

corn

Also,

*,
&

the

value

Attorney

General

has learned he can't build

#«<

freight cars by political trustbusting. His charge of monopoly
law
violations
against car
builders

has

backfired,

em¬

barrassing the Justice Depart¬
ment, probably can't be sucessfully

pushed
by
the
AG's
lawyers. More important, it has

Synder

The

under

cially. They claim
suggested

stop

such

there,

won't
<«

American

The

London

facturers.

75%

tax

cise

Right
trivance

goods. In the "Keep Out" signs
already posted on our Mexican
and British frontiers

they fore¬
(I) crippling of the recipro¬
cal trade program, (2) and an
untimely curb on U. S. foreign

see

pect

They view neither
with

tranquillity,

pros¬

profes

political.

some

$2.25

pester

along pending
legislation permitting utilities to
such

grids

confident—the

construction.

.*■

State

are
'

Clark

price

would

fixers.

Justice

Federal

and

Trade

jail

Department
Commission

both

gunning for the Millergiving validity to
these state
statutes, want the act
Tydings

Act

repealed,

won't

get what they
trust-busters can't do

want.

The

than

practices

scowl

condoned

those

the

price
state

codes.
*

♦

Don't forget—three joint Con¬
gressional
subcommittees will
take the field in
mid-September
and

compete

General

attention.

without

interstate

$1.75
brands netting not
$2.25.

predicted

Clark
The

with

for

three

Attorney
consumers'

will

hold

public hearings on high
prices,
will bid the little
folks to come

not

sion

the

lowering
than

quarter

FPC

its

out this week

you

newest

—

the

86%

declined

cheaper
the

prices

conditions

big

buy

use

three

and

tration
The

and

produced

market

rose

insured

lower

excise

encourage

only

again

would

face

value

soared

938,000

you

wish

more.

order

copy,

and

municipal

Lloyd E. Canady
previously re¬

was

Chron¬

argues

10-centers

bring out new economy
brands. FTC holds the graduated

loans

above

approved

loans

face

value,

with

service

and

One Park

Avenue, New York City.

Clifford Hawley Dead
Clifford

ap¬

Hawley,

Sheridan,

|Bogan

billion. j

active

Army Air Forces, has resumed

his association with the
company
is now at the
uptown office,

despite pre¬
dry up after

Co., Philadelphia, died
Aug. 13 at the age of 58.

Old

Reorganization
Rails

respec¬

Domestic & Foreign
Securities
New Issues

Ridgway & Co., members of the
New
be

York

formed

offices

the

Stock
on

Exchange, will

September
Broad

with

Street,

M. S.WlEN & Co

New

Partners will be Wil¬

ESTABLISHED
Members
40

Ridgway, Jr., member

Exchange,

and

Richard

1919

Security Dealers

Exchange PL, N. Y.

Ast'n

HA. 2-8780

Teletype N. Y. 1-1397

Balsam, general partners, and J.
Lester

Parsons, Jr., limited part¬

ner.

residential and commercial elec¬
tric
power
costs
in
cities
of

50,006 population and

well

and

stocks

Purcell, A. U. S., recently

Formed in N. Y. City

liam C.

small manufac¬

turers to

bonds

Ridgway & Co. to Be
I

York City.

issues

from

the

loans

tively, of $4.7 billion, $127, mil¬
lion, and $232 million.

the

1939

83.9% in 1946.
*

securities

over-the-counter

retired

unabated
it

approximate

eco¬

tobacco
prices
largely
squeezing
out
the
economy
brands, the big three's share
the

John L.
Thomas, President of
First Investors Shares Corporation
has announced that Colonel Wil¬

basing point sys

sharply

67.6% of the nation's total. With

about ten years. He
time a director of

one

First Investors Shares

proved by the Veterans' Adminis¬

big

rising

would

report

flow

and the

of all

favored

cigarette,

for

Cot. Purcell With

under

and 73,500 business
ventures, with

brands,

tobacco

instru¬

was

club to

after the onset of the depression

when

Canady

Company

passed the million mark in July

Agriculture Department

the trend of

Iron

Congress
outlawed
the
RFC's
secondary market for such mort¬
gages. Applications for such loans

cigarettes sold in the U. S. The

nomic

now

Presi¬

was

liam L.

continues

1929, before the advent of

percentage

and

Joint

Raleigh,

ported in the "Financial
icle" of August 14.

com

elude 831,000 homes, 33,500 farm,

three manufactured

Atlantic

McLean

Formation
&

It's

so-called

The

lower Federal'revenue. That's im¬

short¬

can

from

props

Treasury is expected to report the
change would boost rather than

10-cent

and

tern.

dictions

prior

Secretary

the

Government, state

really
just
of FTC's protests—al¬

cheaper

ready numerous—against

and

the

prices.

another

Agriculture Department
have
written eloquent indorse¬
ments—not yet made public—and
Commerce, Justice and Treasury
Departments are to do likewise.

For

ex¬

strong Republican
backing. Federal Trade Commis¬

materialize.
,

from

knock

The bill has

ac¬

com¬

hopeful—but

trade

are

ages won't

practice laws
apt to immunize some people

Mr.

fair

in¬
from

domination makes for
inequitable
distribution, faulty flow of elec¬
tric energy. A little
concrete evi¬
dence might nudge

FPC

companies

regional grids without
their plants to FPC

subjecting

merce.

car

this

warning

prohibiting

power

expedite

power

public

been

that

builders pool their resources to
F

regional

the

They've

Congress

establish

and

American

high

portant.

utility executives

won't be too sad if

setting

than

At least

trastate

has

boosting the

$3.25 per thousand
cigarettes to $3.50

rate

practices

against

the Administration

now

are

trade.

and

netting manufacturers

the

unlawful

was

and Steel Institute. FTC doesn't.

our
dollar diplo¬
suspicious of any con¬
walling out American

sion's

North Carolina

bonds.

plaint

deal

Actually, the case can be liti¬
gated for years, can't be used by

those

grim about the film excise.
*

also at

writers

competition

econ¬

now

bill

C.,

the Virginia-Carolina Joint
Stock
Land Bank of Elizabeth
City, N.C.
The firm will act as under¬

limitations."

Mr.

with

encourage

Ways

Committee

present

films looks likely.
delegation here this

House

its calendar

Britain's

entering

efforts to have

mean more

■

was

Don't expect early settlement
of the Federal Trade Commis¬

the smaller independent manu¬

the

week
on
British loan revisions
found American spokesmen
pretty

mats

brand smokes to

Means

Revision
on

lower the excise

may

omy

They

foretell

companies

better every day—that Congress

nation has

move.

cigarette

good chance—and it's getting

discussion,

big

Commission,

dent.

not know it yet, but there's

may

been talked of offi¬

even

tually

nullified O.D.T.

For
Vice-

mental in the organization
of this
bank in 1932 and was
connected

reasonable price

had

liquidated, of which former Gov¬

for the big three, influence them
to
keep
their
brands
"within

Secretary

isn't

hasn't

winter.

tax would

which

ernor

were more

Treasury

shortages

lines!

nonetheless wish it

same

Raleigh,

Stock Land Bank of

amount without any requirement
of government insurance or guar¬

and assistants sound convincing
when they insist a higher gold

sional

Attorney General

pointedly offered!

and

Treasurer

apparently

finance.
he was

Oscar

examiner for the
State Banking

no more

this than the British

junior lien loans to the

And not

in this country would

Greensboro

antee..

sitting in

are

nine

abnormally

supplies

high

that

expect
normal quantities of pork and

wil'

November.

Means

and

»;s

months,

prelude to Ways and

be that

intend to do—but

future.

Burmeister invites skeptics to
look
at
the
record.
Figures

v'f

It may

years

serving as JVRfnager of their Ra¬
leigh office until recently.
Before
entering the securities business in
1934, Mr. Canady was a special

WINSTON CHURCHILL1

heed such advice

has

Burnett and
Company, investment bankers of

shall
do, we will make this
Winston Churchill
ancient, glorious land
honored
again among nations, and a free and decent home
for all its peoples who love it so well." •

co-ops,

and

years,

experience
past

firm

resident of Raleigh
for

President

as we

House Small Busi¬

long

Means Committee hearings on co¬

levels."

ent

weeks

rather

past

the

surely

exempt privileges of such groups
It gets' going here August 22 wil
progress to other major cities for

the

six

for

interested

the

win salva¬

can

tion, and when we win,

Company
Commercial

the

Mr. Canady who heads
the

has been

Committee inquiry into tax-

ness

whole story.

omist

dom that Britain

voters

foreign

issue next election.

better follow

Department press release
promising prison for the price

►And now,

channels

into

convince

Administration's

tice

That's

boys

figured it might be jazzed up
.with threats. Hence — the Jus¬

scoundrels.

announce

policy is promoting scarcity and
costly living at home. That's to

price

idea

testimony

calculated

over

Truman's

Mr.

propaganda.

steer

before

out

They won't

it, and they may be coy about
it, but GOP committeemen will

wasn't paying enough at¬

press

'I !■

peter

may

political

from

and talk.

newspaper

And that's about all.

attention.

'I' ;
i

<♦>

•

Actually, what the AG wants

i'
*

announced.-

together.

Don't

offices

Building, Raleigh, N. C., has
been

national body and soul
These we will succor
from our growing and victorious
strength. The strong will have to
help the weak. Instead of attack¬
ing capital, we will attack monop¬
oly. Instead of imposing restric¬
tions and controls, we will attack
restrictive practices of all kinds.
It is only along the path of free¬
keep

the

effort. to

supreme

N.
C.-Formation
investment securities
firm
Lloyd E. Canady &

Seaboard Fruit Co., Inc.
HAnover 2-0050

Teletype—NY 1-971

FPC

General Products Corp.

R-33.
*

Home

Firm Trading Markets

improvement and repair

FOREIGN SECURITIES

loan

liberalizations have become
effective with President Truman's
signature of a bill passed just
before adjournment.
Under this
Act Federal
saving and loan

CARL MARKS & P.O. INC.

asso¬

may
(1) make unsecured
improvement and repair loans
are

insured

guaranteed by the Veterans' Ad¬

ministration, (2)

FOREIGN SECURITIES

up
in¬
or

make unsecured

Empire Steel Corp.

All Issues

ciates

to $1,500 when such
loans
sured by the FHA or

Susquehanna Mills

Hill, Thompson & Co., Inc.

SPECIALISTS

50 Broad Street
—

New York 4, N. Y.

AFFILIATE: CARL MARKS & CO. Inc. CHICAGO

====

Markets and Situations for Dealers

120

Broadway, New York

Tel. REctor 2-2020

Tele. NY 1-2660

Full text of Commercial and Financial Chronicle : August 21, 1947, Vol. 166, No. 4622

FRASER