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op'Ye
ESTABLISHED IS39
",C^L
Aii'
/
the Commercial
an
Financial
Reg. U. S. Pat. Office
Volume 188
Number 5770
EDITORIAL
New York 7, N.
\
Y., Thursday, August 21, 1958
Sources of
also
troubled
a
period
a
of
dreams
which
to
of
vain
different
live.
in which
era
and
if
we
By
Practicing what he preaches, bankers group's economist
demonstrates his informed familiarity with what he be¬
lieves
"<
they are
They are sometimes foolish because thevv
are
wholly inconsistent with the realities of life.
This ferment exists not only in far-off places
where people still live in ignorance, poverty and
disease—as so many are so fond of saying about
the millions, even the hundreds of millions, of
people whose unrest and rebelliousness are caus¬
ing international complications and even threat¬
ening international disaster. They are found also
in the sophisticated populations of Europe where
not infrequently the disease of communistic no¬
tions has taken hold, and they are found in one
istic
another in
our
own
are
economic
our
to prevent
ur.es
teachers
and conditions tinder which
areas
bility
—in
fumble
American
countries
—
which
of
all
are
of
Continue
on
page
24
about
worry
our
huge deficit in times
chiefs face dilemmatic problem of ending
nomic
reasonably stable
unemployment and preventing
eco¬
dollar.
growth, but questions whether
we are well enough
achieve these objectives.
informed to support measures to
Millions
less
central banks
and monetary
may
well
of
including most teachers,
Americans,
off
today
ration for
they
five
and
half
million
men
on
the
slowing glow outflow down to
a
trickle, but
when price inflation
resumes.
1929, gross national product (so-called) amounted to
$104.4 billion. In the first quarter of this year, it ran
at an annual rate of $426 billion.
Of course, the dollar is not what
gggg
it used to be. In purchasing power,
were
a
in
run
Treasury head's recent gold-price decla¬
In
record peak,
a
incipient
an
fiscal
our
are
a year ago.
Over
living costs have risen
whereas industrial
production
and employment have
declined.
By latest count
almost
than
Praises
fears outflow may resume
the past year
to
Z
rumm
ri
'
it
and
is
worth less than
cents.
50
And.
the
population has grown in 30 years
by about 52 million souls, or 40%.
this country are now out
work.
problem of economic in¬
very much with us today,
as
it has been for generations past
and will be for generations to come
That
—provided, that is, that we do not
fumble it so badly that the com¬
biggest boom up to that time.
Take any other dollar signpost of
activity, such as increases in the
money supply, liquid savings, debts,
adjust them to the rate
of the
money's depreciation and of popula¬
tion growth — you will find that
currently we are* "progressing" as
So
the
missars
This
tastic.
Dr. E. S. Adams
take
over
and handle
it for
proviso is by
A
no
means
fan¬
strong economy is today
our national security. If
Dr. Melchior
essential to
our
economic strength were to be sapped
flation
or
by
*An
well
depression, the safety of the
Continued on page 28
severe
a
as we
did in the
A similar
address
by Dr. Adams before Joint Council on Economic
National Science Teachers Assn., and the National
Council for Social Studies at Sarah Lawrence College, Bronxville,
N. Y., Aug. 7,
1958.
:
,
V
Education,
Palyi
either by in¬
picturej
a
same
in
us
this
"reces¬
capita
per
dollars,
in
than
leaves
with
stable
Russian-style.
us,
still
sion"
stability is
trouble
spots—have been much in the headlines
late. No inconsiderable part of the discontent
confidence was
invite the "commissars" to take over
Russian style. The author does not doubt that we
then
we
avoid inflation and achieve
can
cliques which claim to be able to right the situa¬
tion more effectively and more promptly than
could the individuals of these nations operating
Latin
onoe
peaceful conditions; and (4)
women
of free enterprise. The Middle
Africa as well as some of the
rising costs"; (2) almost at
of reasonable
Russia have surrendered themselves to groups or
under any system
East and parts of
short of capital to
ran
of industrial .aggrandize¬
pace
badly the problem of economic insta¬
we
China and
as
our
He points
recovery..
pean
that if
a
such
ment *t
(I) We
"reckless
our
eco¬
relates economic
of
the fermentation. Vast
and inconsistencies in
shaken in 4be future valueaf the U. S. dollar; (3) Euro¬
ferment—and
apparently not accomplishing a great deal to im¬
prove the conditions which are supposed to cause
is well known, is in
as
maintain
all-out crusade &>
Dr. Adams
literacy to economic stability, and warns
have also infected many
India,
out, for example, that:
meas-
embark upon a continuing,
such—
as
of and
causes
are
cyclical growth and prospects for
undue economic instability in suggesting
midst where social¬
precepts—usually not recognized
men's minds.
objectives,
economy
probed by Dr. Palyi in reviewing
policies
improve public's knowledge of economics.
manded.
or
Distortions in the
in
conditions
j
Chicago, 111.
ADAMS*
often vain be¬
are
they demand the impossible, or at all events,
they ask for things which caninot.fce had-on the\*
form
SHERMAN
E.
nomic
cause
terms
DR.
Copy
a
By DR. MELCHIOR PALYI
Deputy Manager, American Bankers Association
foolish
sometimes
better
not
These dreams
live. It is
Cents
Recession in Perspective
Instability
In Our Economy
As 'We^See
This is
Price 50
almost
1929—the
year
output, in
60% higher
of history's
period of 1929, if not better.
more or
less, obtains by comparing
physical quantities. When the steel industry operates at an
The
|
«
Continued
23
on page
SECURITIES NOW IN REGISTRATION—Underwriters, dealers and investors in corporate
securities
dealers
are
afforded
a
complete picture of issues now registered with the SEC and poten¬
in Registration" Section, starting on page 34.
tial undertakings in our "Securities
State, Municipal
in
U. S.
and
Government,
MEMBERS
State and
Municipal
STATE
Securities
and
HAnover 2-3700
BONDS
.
MONTHLY
BOND
LETTER
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15 BROAD
CA.LC:
Underwriter
■
!
•
623 So.
AND AMERICAN STOCK
on
Southern
■
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California
New
York
Stock
Exchange
Member American Stock
Associate
Bond Dept.
Teletype: NY 1-708
New York
Exchange
Net
Distributor
To
T. L.WATSON &.CO.
,
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,
Active
Dealers,
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and
Brokers
CANADIAN
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ges
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NEW YORK 4, N. Y.
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WIRES TO MONTREAL AND
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PERTH AMBOY
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NEW YORK
t NORTH LA SALLE ST
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Poxraotx Securities
<depokati07t
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MEMBERS NEW YORK STOCK EXCHANGE
DALLAS
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/IEN
DEPARTMENT
Teletype NY 1-2270
-
COMPANY
|
THE
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,
Correspondent—Pershing & Co.
CANADIAN
New York Stock Exchange
'
s
DEPARTMENT
ESTABLISHED 1832
—•
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,
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Dealer
<■*
-
Securities
EXCHANGES
STREET, NEW YORK 5, N.Y.
•
Dl 4-1400
TELCTYPK NY l-22«2
Bonds and Notes
Hope Street, Los Angeles 17,
Members
OF NEW YORK
Burnham and Company
MEMBERS NEW YORK
Housing Agency
BOND
THE FIRST NATIONAL CITY IANK
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30 BROAD
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Lester, Ryons & Co.
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bank
Incited
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view
burnham
EXCHANGE
10:00 AM-5.-30 PM E.D.T.
Inquiries
THE
chemical
COAST
Trading Hoars
,
telethons:
PACIFIC
MUNICIPAL
40
Exchange Place, New York 5, N. Y.
Teletype NY 1-702-3
WHitehall 4-8161
.
DEPARTMENT
Hmtk of Atttmctt
national
"vyngj association
300 Montgomery
St., Sao Francisco,
Calif.
2
The Commercial and Financial Chronicle
(702)
Brokers, Dealers only
For Banks,
The
*
which, each week, a different group of experts
In the inYestment and advisory field from all sections of the country
participate and give their reasons for favoring a particular security.
pride in the abil¬
take
We
to
(The articles contained in this fornm
.
of
range
Members: New York Stock Exchange
Assoc. Member: American Stock Exch.
f
Member: Midwest Stock
problems.
Mohawk Rubber
Perhaps
New York Hanseatic
of this
readers
things
Established 1920
American
WOrth
Exchange
Private
lor
.
.
There is every
the
Specialists in
tire
business
RIGHTS
SCRIP
&
Morton A.
stock
market
120
Exchange
Exchange
the
for
is
stock
mid 30s.
^
the
in
v
.
the
common
Rubber
the
half
first
this
of
year
was
against
$187,000 last
year or $2.71 vs $1.19, the $1.19
being adjusted to 157,129 shares
Trading interest'In
-
4<,!
.
American Furniture
.
*.
'
.
i
Bassett Furniture Industrie*
now
May
obtained
of;this year, Mohawk
ITMNR-and COMPANY, Inc.
You
have asked
presentation
cultural
con¬
-5-2527—
Private [Wfre
all
other
long-term
debt.
'
Tarming
For current information
y
Call
'
or
Securities
of
'
New
our
Company
/
^
'
Yamaichi Securities Con
1958 appears I
Ltd.
-
Tokyo, Japan
will
farmers
■[
York, I no.
Affiliate of
that
•
write
Yamakhi
.
appraisal of the agri¬
outlook for
indicate
to
continue to receive supports, and
that the demand for steel storage,
"
Brokers
&
Investment
'
Bankers
111 Broadway,Y, 6 GOrtlandt 1-5680
'
Automobile and Appliance Sales
While automobile and appliance
City
sales
below
will > bulk
large when compared with the
average of the past few years, and
the
company's management ex-
of
the
for
me
a
brief
"the
Chronicle.
the
year
I aril
so,
Promising and More Certain
or
con-
j
reasons
outlined
as
the
first
Investment/Securities
bUlion barrels *
33
last year,
time
•
;
.
Canadian and Domestic
rise 50%
during the next decade.
.-■< untapped
reserves -of /
Canada and Venezuela, and prom- '
isirig new developments in other I
The
follows:
The indus-
tries*served*by
vast
export4 markets -indicate
a
eon—
tinuing growth pattern for Black, %
Sivalls. & /Bryson sales. ^ v
> ;
/
t
Charles T. Greene
Emphasis»
cost
on
These industries - are should; serve ;to
growth industries and their mand ^ fori the :
economy.
also
'Dealers
-
,1
.
v/:.
Street, Hew Yo^k 5, N. T.
Underwriters-^Distrilutors
/
and
gas reserves expanded to 248 tril- /
lion cubic feet.' Consumption of ;
.foil in ithe world is 'expected *to
& Bryson is a
are
States (topped
for
Black, Sivalls
•M-y'
V INC.
37 Wall
Crude oil reserves in the United;*
that
vinced
-
Longer Range Prospect More
market for the
past
expected to fall
are
1957 " level, > they
.
gfcts a; fairly satisfactory year in
these departments.
Having ob-
a
pay
the
:
;
,:
A realistic
security I
like best" for publication in the
I
LYNCHBURG, VA.
LD 39
to
in
expected to have a good
Research Director
15 year insurance loan. Black
siyalls
$2% million of which approxi- & Bryson are
mately $1 million was added rio
basic and esworking capital and the balance sential to * our
used
down
''
of
Commonwealth Natural ■ Gas
STOCKS
Capital spending I
be
-
/
:
branch efflcee.
JAPANESE
industry, but not less
present productive ca-
its
our
of
industry
power
SOme
Security I Like
logical choice.
outstanding.
For the full year ending Dec. 31,
1957, Mohawk earned $3.90 on the
then outstanding 144,533 shares.
In
Life'Insurance Co. of Va.
as
the
the chemical and'
stock of The
Amos Treat & Co., Inc., New York
in
$426,000
Mobile, Ala.
Direct wires to
Industry
the -President
to
NY 1-1557
a
havior
had
HAnover 2-0700
New Orleans, La.- Birmingham, Ala.
pro¬
19%.
will be favorable.
sales of
$10,830,000 this year compared to
$9,485,000 in 1957. Net profit for
Mohawk
of
to
•
expected
than
its be¬
30,
Venezuela
growth pattern.
CHARLES T. GREENE
served
June
TEL. RF.ctor 2-7815
19 Rector St., New York 6, N. Y,
n rf
slated to continue its rapid
very
Company
The
period ending
In the six-month
BROADWAY, NEW YORK 8
decline
company,
seems
is
j
1958, down 7%
years.
Financial
;
.
-i nrn
„
The Power
Blaok, Sivalls & Bryson
The Security I Like Best."
My opinion and views have not
changed
although
the
current
Members
Stock
many
since
and
come
tive value (over-the-counter mar¬
IfcpONNEII&fO.
York
is
Members New York Stock Exchange
Members American Stock Exchange.
expected to drill 1,500,
are
a
According
ket around 18% to: 19%) I view it
as
American
with
Best.
time to
11
1957 -and
ducers
today
continue to flourish
win
some
Mohawk
of
<*..
Steiner, Rouse & Co!
New
r
should continue to grow
tinues to be
Cayne
nr\r\
o
and* "the busings oVThYs
this stock presents such an attrac¬
Since 1917
New
future
Mohawk
replacement
for
use
r
.
2,700 wells in
from
major auto company's
within the very near
Yes, the
indication that
■
in
(•
„
of
With 1958 sales
projected to aiound $24 million
and probable earnings very close
to $6.00 per share, the price/earn¬
ings ratio today is about 5%.
man¬
& Co., Inc.,
(Page 2.)
nadian outlook is for the drilling
.
..
..
''
,
B ought—S old—Quoted
==s
refining
The
excep¬
Treat
City.
:
future.
in
.
.
'
.
(Page 2.)
-—■
a
on
products
company
agement.
Amos
York
equipped with tires produced
by only 11 manufacturers. In this
vast
market, Mohawk concerns
itself with only replacement busi¬
ness, however the company fully
anticipates having original equip¬
ment
fast growing
tional
51% million passenger
10 million trucks
vehicles
million
61
bright
having
.
Louisiana Securities
A.
Black, Sivalls & *Bryson—Charles
T.
Greene, Research Director,
are
company
a
Principal Cities
/
Co.—Morton
Cleveland, Ohio.
considering
the new cars sold this year, less
'.
the number dispatched to the junk
heap, yet all of the approximate
participate
SAN FRANCISCO
to
Wires
Rubber
has little change when
presents an
opportunity to
CHICAGO
•
•
nor
registered in the U. S. as of July,
1957.
This
number
undoubtedly
.
Rubber
5
Teletype NY 1-40
4-2300
BOSTON
.
Mohawk
120 Broadway, New York
•PHILADELPHIA
I
".
stated,
Member
Stock
Ohio.
other
Akron,
Among
'
I
Rubber
Mohawk
be,
to
reported that there
.
stock
of The
Company
of
the
presented
Corporation
Associate
Alabama &
Syndicate and Buying
Dept., J. N. Russell & Co., Inc.,
'
Company
few
a
Exchange
column will recall that last fall
;
Mohawk
about
and
cars
'Cleveland, Ohio
been
about
were
J. N. Russell & Co., Inc.
Over-the-Counter
not'intended
are
It has
Syndicate and Buying Dept.
pay
advantage
your
Participants and
Their Selections
offer to sell the securities discussed.)
as an
MORTON A. CAYNE *
you
to take
of our nation¬
wide
private wire service
and
prompt service in
will
It
they to be regarded,
are
extremely f
contacts, -I
an
cover
broad
Thursday, August 21, 1958
Cayne,
!
of our large and experienced trading department
.
This Week's
Forum
A continuous forum in
Try "HANSEATIC"
ity
Security 1 like Best
.
.
reduction
further the de-^
cohipaiiy's new
IN JAPAN
Write for
our Monthly Stock
Digest, and our other reports
that give you a pretty clear
picture oLtheJapanese
'
whole.
economy as a
TWX LY 77
City |
to New
company
i
$1.00
share
per
dividend
at
with
end.
year
«paid
Two -25
cent dividends have been
far in 1958 and it is very
PENSION FUNDS
INVESTMENT TRUSTS
Other industries
Petroleum and Natural Gas
stock
2%
paid thus
likely that
Demand
for
natural gas -seems
almost insatiable with a-doubling
served—polwer,
chemical, automotive, appliance, |
aircraft, agricultural, L-P gas — j
,
id I
are
industries
basic
dhe.
to
of the nation: The ^com- I
this dividend will either be in¬ 1958 forecasts indicate
drilling of pany's. new line -of ?pre-.fabrieated'
creased and/or supplemented with
52,134 oil wells in the United meial buddings is,expected to
stock at the close of this' year.
I
States, only 3% under the 1957 open up new markets for Ihe
Two Mohawk plants located in figure.
>company in general industry and
Akron, Ohio and West Helena,
The oil and gas industries con- commerce.
Ark., produce both tires and tread stitute the largest markets "for
The years ahead, in the opinion
rubber
while the
newest
plant Black, Sivalls & Bryson products, of the president, should be rein demand during 1958 since 1954:
economy
61 Broadway, New York 6, N. I.
Telephone : BGvrIio© Green 9-0187
Tills is not
an
offer or
solicitation if or
orders for any;particular securities
-i.
,
INSURANCE COMPANIES
.
The additional income pos¬
located
duces
sibilities through the sale of
Put
and
Call
Options
are
at
Calif,
Stockton,
pro¬
tread
rubber,
the
product used
in retreading
or
recapping tires. About 40%
of
,
only
.
....
total
worthy of investigation.
►
1
.
'
A
representative of our firm
will be glad to explain the
'
^subject
to
those
who
are
during
Interested.
•
income is from this product,
generally used where low budgets
prohibit the more expensive replacement tire. Snow and mud
recaps have become increasingly
popular for passenger
vehicles
winter
and
months
the
recapping of truck tires has been
successful for many years, reduc-
'
Ask for Booklet on Flow to Use
Stock Options
Filer, Schmidt & Co.
Members "Put & Call Brokers &
'Dealers Assn.,t Inc.
198 Broad way, N. Y. &
'BArclay 7-6100
replacement
operators.
costs
mg
for
despite the prospect of a redrilling program, the level
of activity is expected to remain
high when compared with activity
levels prior to 1954. Thanks to1 a
vigorous research policy, the company is now able to blanket -the
entire
oilfield
system
with
a
packaged
(automation),
a
far
J
nv^Q4fi(
the
Intend
interest and
interest and ronnpratinn nrnvidpH
cooperation provided
/themiatfthe
•through 4he
.departments.
Mohawk -plants
sales
or
.
t
.
.
Sales volume last year reached
new high level at $47,441,871,
topping the previous year's total
by 3.6%. 411 but 2%nof. this record /volume,
-which 'constituted
a
was
*«ori--.
signed to the company's varied
and aicito- commercial and industrial outlets,
matically to operate oil and /gas Of the 1956 total volume,'9% rep-,
producing fields through remote resented government contracts.
f
control.
Information
on
daily V T
production runs and other
per.ti-r$3
machines for analysis.
Dealers
-
distant0 location,
reputation
trade.
,
„
producer to sit in his office in
nent data can be automatically
transmitted to his office wherfe it
the
-
,
Record Sales Reported in 19»7
,
allowing/government^contracts,,
a
Field men work very closely
with tire recapping customers and
Mohawk
has
built
a
national
in
warding!
and
duced
is
fed
into
standard
63c? 7?1
versus
Atter
1056
???
'
ot
$4 960 979
Dreferred
in
.dividend
J~
^
0ver-'ffie*Counter
lor 48 Years
computingstn%?iR*
versU?^4 53 in J95V The
nosyrB&
enjoy? 527% decrease itt net^teco^e fori
/
^
v^r
?, su?.sta"tlal^^ovCrseas markettior,. 1957 ls Attributed pritfiarily toithe '
1 f country products, and our- introduction, - paradoxical ^ as it'
rent restrictions on crude oil immav
seem
of
hayefo^ced^aTOemlnt" to.
or
.ports into.this country
research curtailed producing rates in bothi
Canada .and
Venezuela.*'
technological
®- ^
r
mstamih*&~19l3
ad-
fe
s
TheJCa-Continued onjpage 33,1
46 Front Street
CHICAGO
NewYeAMLL
SAN FRAJNUHOO
Number 5770
Volume 188
.
.
The Commercial and Financial Chronicle
.
(703)
INDEX
Breaching Ail-Time High in |
Dow-Jones Industrial Average
By
LESTER
WYETZNER
J.;'
in
Wyetzner
Investment
average.
■
-
r-"-'-::'
'•':••• »'-*
y rent
levels.
warning signals have
been given by the technical action of the stock market during
the past, three weeks, foreshadowwhat
ing
may
develop into
V...
time
to
the
in
*
Industrial
Federal
Average.
On
July 31st a f"
the
,•
sharp-
:
and
then
all
lost
previous
on
gains,
,jon
of
age,
which
zone
a
band
area
low the all-time
all,
exists at that level.
The failure of the
to
considerable
of
both
This
to
has
caution
investors- and
a
dipped
volume
below
of
sessions.- Not
only
same
meree
and
ket-enthusiasm dampened, but the
almost
.immediately.
clearly illustrated by
son
the
of
average
a
This
is
of the fen most active stocks each
for
day
the
-
\4th.
On
figure
was
four
week
Friday, Aug.
Aug.
8th,
this
30.16. .During the next
trading days this index flue-
,
x
ending
,
.
tuated
as
.
,
„
__
market
cannot
be
expected
launch another drive
overhead
qverneaa
better
to
resistance
resistance
gradelequities
to
against" the
force
force
again
unless
unless
come
the Torefront.
specialized in
These
Against
Loss
of
._
New Transportation
on
10
J.F.ReilIy&Co.,In€.
Members Salt Lake City Stock Exch.
Business.
a
'
'
.*
•
V/
made.!,
33
;
»
-
has
Bank
'
in
Guaranteed
of New
Bank
Loans
to
Students
Noted
General Gas
*
Pacific Uranium
43
Repayment Record
J*.
American Express
44,
>.
Mass.
Regular Features
:
As We
Bank
See It
(Editorial).
and Insurance
;____
Stocks.
25
Dealer-Broker
Investment
Singer, Bean
44
^
Coming Events in the Investment Field..
8
,
Recommendations..-
&
8
Kinzig: "Effect of British Bank Rate Upon Sterling and the
Economy"
State.
.
r
NSTA Notes
dent, Isaac B. Grainger, the.Cham- j
ber
warned ..that
not
kept
New
York
has
of
this
Public
trend,"/.
it cautioned, "could have unfor-'
lunate consequences for all -our'
The
a
-
,„tt;r
to*:a
sponse
Was
^
;
.
;
Securities
^Securities Now
in
lhe
38'
By Wallace Streefe
Worcester
16
*
1
♦
»
•
•"
Pan American
44
*
Published Twice Weekly
"
The COMMERCIAL and
/
i
{
Copyright 1958 by Wffliara ft.- Dana
Company
......
-
.'s
.
.
*
Q
'
"
REctor
Patent Office
.
•
on
i»
Request
4
r -s
^
25,
1942,
at
~
New Yoric 7, N. Y.
2-9570
to
9576
I
j
"f
Subscription Rates
,
•
WILLIAM DANA SEIBERT, President
Subscriptions in United States, XT.
Possessions, Territories
and
Members
8.
Pan-American
HERBERT D. SEIBERT, Editor A Publisher
in
Dominion
Union,
$65.00
of ..Canada,
Countries,
per
$68.00
$72.00 per
year,
per
of
WH. FRAHKEl & CD
J.
INCORPORATED
year.-
39 BROADWAY, NCW
year.
YORK 6
?
Thursday, August 21, 1958
Thursday '(general news and ad¬
vertising issue) and every Monday (com¬
plete statistical issue — market quotation
records,
corporation
and
Other
city
Chicago 3,
111.
news,
news,
Offices:
135
bank
clearings
etc.).
(Telephone
Bank
$45.00
STate
Salle
St
2-0613)
and
per
Note—On
the
South' La
WHitehall
Other Publications
,
Every
state
1
♦
COMPANY, Publishers
Other
*
•
1
./
the
post office at New
York, N. Y., under the Act of March 8,1870.
ary
*
)
,
j
!
.
j
Reentered as secona-class matter Febru¬
-
DANA
Prospectus
y
.
-
It.
*
Epsco, Inc.
,
FINANCIAL CHRONICLE
Reg. tJ. S.
<
Corp.*
Sulphur
J ' . • i
\
.
'
r
*
4
-
^Column not available this week.
,
'
Witco Chemical
*
TELETYPE NY 1-5
Glens Falls
Specialty
Ling Electronics
________2~
■
25 BROAD ST., NEW YORK 4, N. Y.
-
Electronic
i
Washinfftoil and'You
Commerce
Members New York Stock Cxchuife
Schenectady
10
34
The State of Trade and Industry,.-..
'
"
r<-
Committee,.
of
•
Chicago
___________
—
........
Market,
and You
The Security I Like
PREFERRED$TOCKS
TELEPHONE HAnover 2-4300
I____
L__.;
_______
Dr^ared irrTe-Pr#s^th'«
from Judge,
^Salesman'*-
Republican
Dallas
Radorock Resources
.
request
to^Chambers
Chicago
29
Registration,
Daniel Gutpmh* Chairman of jthe^ -.-The
and
i
.
Angeles
'
v
—-—
Securities-
v
Democratic State Platform Com-,:
A similar letter was sent,
to
Philadelphia
to
Los
27
Report
s
Utility
Railroad
Direct Wires
San Francisco
^
4)ur-Reporter
continuation
"A
N. Y.
5
Qur Reportert on Governments-
r
in manufacturing..
,
inc.
40 Exchange Place,
18
r.
MayJlill.JlZ—--—
Observations—A.' Wilfred
\vifh other States
growth, particularly.
pacq
economic
*
Teletype NY 1-1825 & 1-4844
5
Ne\ys Ahout Banks and Bankers
_
in
Mack ie,
HA 2-9000
—
le^er signed-by itfi'Presi-,
a
upon request
Cover
.___
-----
Business Man's Bookkshelf.
Bonding & Ins. Co.
' Prospectus
^
*1
A
Witco Chemical*
v
by
York
Excellent GI Loan
'
1
Denver
City
Food Fair
Supplying Real Growth to the Economy Enumerated
by Federal Reserve Bank of DaHas_________
39
Uptrend
the Democratic
Platform'
urged
(Boxed)
Forces
'
!
.
"
•
to
33
•
current
;
'
*
wires
Salt Lake
.
Hear! Hear!
r
HEnderson 4-8504
Teletype: JCY 1160
Direct
,
base of accumula-
below.
Exchange PI., Jersey City
DIgby 4-4970
Mutual Savings Banks Membership in ABA to Be Voted Upon
in September
-____
:
two
high of 521.05
1956,'the list: will
in
1
(Boxed) 22
Joseph Holzka Reports July Home Loans by Savings and Loan
Associations at Record High Level__32
.m
.
Spencer Trask & Co.
Smathers' Views
Rican
25 Park Place,
Nashville
Warns
FORTUNE PETROLEUM
Sharp Construction Rebound Reported by F. W. Dodge Corp. 27
and
J-
Boston
Commerce
17
Spokane Stock Exchange
WILLIAM
Albany
of
Wanted: An Agonizing Reappraisal of Foreign
Policy
;
have
Chamber
16
Montague___.
Study
Puerto
throughout the State.
For many years we
y__
CORRUGATED PAPER
Tliree-Way Partnership Formed to Help Finance
.
upsurge,
decline.£*;.
follows; Monday, 25.31; :,.;ti7Pna»
Thursday, 15:50. Certainly the
FT. WAYNE
15
18
today to incorporate'"
in their platforms
recommenda- v Front Washington Ahead of the News—Carlisle Bargeron__^._ 17
tions designed to help
maintain'
Indications of Current Business Activity...;
42
New York's position of leadership
Mutual Funds
*»_■
40
in business activity,'
Tuesday,.27.12; Wednesday, 19.42;.
and
Unique
strong base
and < 490.
Republican
compari-
closing price
York
Policy
•
Committees•
mar¬
quality, of leadership deteriorated
LITHIUM CORP.
14
and What—Roger. !W. Babson
Senator George
;
The New York Chamber of Com-
million
was
a
In New York State
closing
level for the first time in twentyone
V
Trade in State of New York___
Warns Against Loss
Of Business Activity
transactions
three
the
EQUITY OIL
:
_f__.
The Rule of Reason Is Inescapable—Gilbert H.
New
prepara-
between 480
'
part
high of 512.42 while at the
the
"
levels
traders.
1958
new
In
recent
somewhat '
over-
clearly evident on Aug.
11th, when the Dow-Jones Indus¬
time
V
,
test the all-time
^ion
created
the
on
485
established
was
trial index hit
When to Buy
In
j,ave to build
;
list
resistance
the
.
13
y
Bank's Trust Department
a
REEVES SOUNDCRAFT
;
12
Management of Bank Funds Under Current Economic
Conditions—John T. Masten__l
■
j,
San
of
Before another attemot is
to
penetrate this supply barrier and
was turned
back, indicating
that a good deal of selling pres-
come
consolidation
corrective
a
each
sure
;
;,
be¬
made
were
/ :
The
decline at
a
area. •
the most
between
the
just
in
—May A. Naylor—.—
.
strong
technical ; points- should
provide enough resistance to halt
high of 521.05. In
efforts
four
contains
resistance
of
Basic -Investment Policy
addition, the rise of the
past five months has formed an
upward trend line which now lies
of the Dow-Jones Industrial Aver¬
final
480-490
)0l.
485.
this signal, the
market made its first attempt to
512-520
!
.
,he market had built
Several days after
the
the
in
a
through
..
,
/;
point, indications suggest that r
anywhere as severe '
as that witnessed just a year ago. ';
jn fact
support is likely to form
change in the intermediate trend.
break
*
.
it will not be
late tape, just betore
trading ended. In .the past, such
pertormance provided a clue to a
again
Solid Foundation
Anti-Trust and Insurance—Victor R. Hansen__
this
,
11
_-___
a
—Richard L- Cheney-^-^j—_l-_—_J_
;.y
Reserve,
Bank
As to the extent of
Lester >W y etiner
higher^. on
a
late
tape
during the middle of the session
STREET, NEW YORK
Telephone: WHitehall 4-6551
the discount rate Of the
Reserve
WALL
—9
—President: Eisenhower
y
to stem inflation-
and consolidation.
ly
—James R. Clarke
•
sharp
upward
drive
of
stock
prices which began on July 15th,
but it is more than likely to usher
in a period of market correction
one-
market
moved
:
<•-
Francisco has not only halted the
d a y reversal
pattern
was
witnessed,
as
•„
in
crease
Obsolete Securities Dept.
6
±
99
this
at
progress
Federal
moves
obsolete."
4
Glass Container Business Has
tendencies. The influence exerted by a combination of higher
margin 'requirements and an in-
BHfL*
per
Dow- Jones
"classic"
the
are
Cobleigh
Participation in Canada's Growth Through Canadian Securities
;
ary
four
cent
upward
K9ipj|p|J||^H|: Board's
three
of
further
•
considered
Garages Called
Promoting Peace and Progress in the Middle East
Factors
v
we're
U.
Boats—And
—Daniel Parson
Dampening
Tjie primary non-technical-developments which are preventing
a.-
corrective decline
*
3
Pleasure
on
Long-Term Outlook for Energy: Including Natural Gas
•
Non-Technical
"Love that Left Bank... but
—
,
'Several
Notes
Marinas—Ira
~
y
PARIS
Breaching Ail-Time High in Dow-Jones Industrial
Average
forthcoming 480-400
Study employs
such criteria as changes in D-J index, volume of transactions, ^
quality of leadership and average closing price of most active
V
; stocks.
Reviews non-technical dampening factors, and con-r, ? ?: f
; eludes another attempt to breach 521.05 all-time high of 1956 jV:
-'
vequires rebuilding base of accumulation somewhat below curD-J industrial
Cover
Sources of Instability in Our Economy—E. Sherman
Adams-Cover
Bache & Co. analyst explores possible
corrective decline in
Page
Perspective—Melchior Palyi
'
>
—Lester
-
Articles and News
'
Recession
Stock Market Analyst
Bache & Co., New York City
V
3
Record
(Foreign
account
of
the
—
Monthly
Postage
be
extra.)
fluctuations
rate
foreign
must
Quotation
year.
in
New
York
funds.
Teletype NY 1-4040 & 4041
Direct
Wire
to
Id
of
exchange,
remittances
fox
subscriptions
and
advertisements
made
3-3960
PHILADELPHIA
,
The Commercial and Financial Chronicle
(704)
4
members
of
Builders
Investment Notes on Pleasnie Boats
American
the
r
Repairers Associa¬
the U. S. Navy Bureau
tion, and
Ships, in Boston, Aug. 11, 1958.
Admiral
Garages Called Marinas
i'elt
the
was
on
day of the
the
other
He
about boats 50 feet and
Containing quite seasonable comment, buoyed up by a few
statistics, on a rapidly growing industry stemming from the
leisure and opulence of our "affluent society," pleasure boating.
afternoon when
ent, in
on
your
SWRppCd a SWivel chair behind
di sshoveled„
delivered
a
volume
X^linnp
Marine
astounding
iclminHintf
Outboard
an
in
business
of
to
..
d
own
the
on
■
;
i
foot
Outboard
.C
55-
a
yacht
breezing east] erly on Long
| Island Sound.
It
was
a
:
per¬
afternoon
fect
for
playing:;
glasses
S sun
j and highball
*■
,
glasses
to
Outboard
Marine
Corp.
Corp.
-
back
is,
J
be
to
market
large
a
for
biggest
tiiff«oct
period is running counter to the customary slow demand, by small
but steady gains week after week.
This development in steel
construction and in some small measure from
the auto industry, which is a month earlier in placing steel orders
for its new-model output. Automakers are buying steel cautiously,
stems mainly from
Owens-Corning Fibern«rone_f,ni'nin(( TTihoi'Basic product is glass
wool which can be adapted for all
kinds of insulation, for filters, for
textiles, and for reinforcement of
is
ic
glas Corp.
a
and
Johnson
out-
Stock
Exchange
around
where
with
4812
an
it
a
quondam
nort
ni
it
suddenly
landlubbers
must
snhsfintHi
a
vprv
It
Well
by,
sup-
of
.
rontinenhd
continental
million
(35
in
□art
.,
Over
for
out
persons)
the
$1.9
new
some
boating
used
boats, and
storage,
fuel, maintenance, insurance,
Plies
and
club
lated to the
re-
million pleasure
craft
afloat
in
1957.
is
a
Ope person in every 25
boat owner.
Now this is
(with'some
awash!)
really big business; it's getting
bigger all the time and growing
at
a
nprfpptlv -fnntactip
reational boats in
than,
since
doubled
which explains
i consumption of
i
use
1950
the
t?pp
rntp
have
more
a
fact
small, craft
million gal-
in
its
re-
sales,
million
Tor
i
\
ends 9-30), rockft
million
over
J
r
in
1Q^7*
reach a new high this
Net earnings, whoch were
million
as
recently as 1953,
$13 million in ]957.
u
f
ju
/' >
common
-ku
Libbey
u
•
Stockhplders
m
siock ownea
Owens
-
owned
-
Ford
Glass
ln4
n
traded
growing
current
No dividends have
i«.
Th
t
companies
i
L
1
oy
Co.
In power
boating, however, the
big booming upsurge has been in
At
outboards.
there
of
3
were
in
motors
1957
use;
this
the end of 1951
million outboard
but
total
the end
by
has
soared
to
5,190,000, including some
600,000 units sold in that year.
Noteworthy, too, is the "horseabout
power
race." Time
could tote
an
when
you
outboard under your
this
3
HP
restore the value of the lollar.
study of past and current movements of food and
a
Board's
Reserve
rise
since
the
recession
low
levels.
year,
board declared.
rec^e^»
processing and fabricating glass
June figures and retail sales
December
hung onto the sterns of
rowboats
were
any
that ..happened
to
old
be
1956, at
...
clubs,
"Recovery in
further.
rose
While
economists
*10,n 0 Engine and Boat Manutacmodern boat, basin
available, but now the trend is for w
facilities for berthing and
boats specially designed for out- sec"nn^ a
types
recreational
board propulsion.
About 320,000 cratt as W€V as providing, ade-
145, the
The index reached its high for any year in
146.
...
^
The board's summary of economic conditions in
industrial production
Construction activity
Employment
and
continued
July sketched
of the spring
in July,"
income
were
from
up
up.
prices of industrial materials went up some, rated by'
as
one
of the signs of improving business, costs of
increased again over June.
corporate
bonds
went
Yields
on
Government securities and
meaning that prices went down, but
prices reached new highs for the year.
Commenting on other economic developments, the board com¬
common
up,
stock
mented:
;
"Incre.as.es in
durable
industrial production were
widespread
among-
goods industries in July."
This, segment of industry has;
felt the brunt of the -business -downturn. / •/
-
■
:
*
--
-
LOOKING FOR THE UNUSUAL
suPPbes,^ provisions and
j?ua.e
lueim& services.
This marina business has been
going great guns. There are approximately 2,100 marinas in the
United States today and there's
a crying need for at least 1,000
more. Existing ones accommodate
anywhere from 15 to 1,500 boats
and there are
Fort
some
fabulous ones"
Lauderdale
and Bay
Biscayne, Fla.; and a brand new
million dollar beauty, Terra Mar,
at Saybrook, at the mouth of the
—
lines
ment
.Tolv
was
activity in producers equip¬
still sharply below the 1957 peaks, it went up in
for the second month.
This includes such items
/'
tools.
as
./•/
-
machine
?
Beautifully Bound Set of
Commercial & Financial Chronicles, 1920-1945
at
The
average
boats
ff
The
Available in New York City—Write or
pt
c/o Chronicle, 25 Park PI. N. Y. 7
$2
up
the
smallest
rate
for
day
a
$15
to
marina
for
reports
on
employment
show
that
the
2,342,100, the lowest since late December.
The decline, continuing the downward trend that began
in
attributed by the United States Department of Labor
chiefly to the recalling of workers in plants reopening after vaca-,
April,
tion
was
shutdowns and to
new
hiring in such seasonal industries
processing and apparel. In addition, some claimants exhausted ■
their benefit rights.
/
" •*/•*...
;
: s
.;...
/
However, the number of workers filing new claims for unem¬
ployment insurance edged up during the week ending Aug. 9 by
6,400 to 324,900, the agency stated, compared with 213,800 a year
Continued
on
page
STATE AND MUNICIPAL BONDS
CORPORATE BONDS
bigger
marinas.
marinas
are
LOCAL STOCKS
little
than
a
far wider and
more
The
ideal
a
safe
marina
and
•
The
Robinson-Humphreij Company,Inc
RHODES-HAVERTY BLDG.
should
well
Continued
4
luxu¬
rious list of services.
vide
ESTABLISHED 1894 C
for
"cushier"
on
pro¬
sheltered
page
10
as
food
small
tie-ups
where
the
pleasure boatman can "gas" up,
and take on a supply of water and;
a
chunk of ice. The bigger ones
offer
Edwin L. Beck
is
and
boats
more
*'
number of
Federalstate programs dropped by 80,700 in the week ended Aug. 2 to
Latest
River, replete with a
130-room hotel,
bar, restaurant,
swimming pools, and tennis courts.
dockage
Phone REctor 2-9570
*!Vf
workers collecting unemployment insurance checks under
Connecticut
FOR SALE
,
While the report pointed out that
^
'
U
the
and private housing starts
personal
held"
out
farm products declined. Even though loans to business went down
in July, the board noted, over-all bank loans ancl investments
it ls denned by National Associa-
lurers^as^ a
In May, the index
picture oi business heading firmly upward
trough*-of the recession.
"et Z ab,OU,nf„lfi0 seTS probable wbich Prided the earliest pri*01" ,1'scal /58//ampl?
7"/- a|ich°rages and docks, are
*°r the curren(t 89 cept. fvl9gn
bulgmg at the"'. sea™- aa/
J!1® c0™f ?,n 1stofck' which sold as have long waiting lists The big
h;8,h as ,37% last ycar' has a/ook newcomer on the boat mooring
°f long-termfattractiveness at cur- horizon, however, is the marina.
rent price of around 25%
In case that's a new word to you,
In earlier days, outboards
April.
a
smaller^ companies whose
wo™, by the stock extras above business should prosper through
yacht
in
industrial production stood at
many
The
of
index
officials reported,
however, considerable im¬
is needed before business will be back to peak-1957^
In July last
highest point for 1P57.
"sually .lo(wer ong>nai cost and
storage.
seasonally-adjusted
/. =•>
provement
less maintenance because they
don t need yearly scraping and
and
126
of
128.
^fleeting the rapid rise in net
Per share
>
Government
future, whose advantages lie in
lar greater structural strength
demon
astern of a rowboat and .sputter
off across the lake at a dazzling of such were sold in 1957—over
3 miles per hour. As recently as double 1951 sales. Most boats, in
1947, .87% of all outboards de- times gone by, were of wood but
veloped less than 7 HP. Today, today there's a strong trend to
only 22% are in that rating. The other materials—some aluminum
average
engine now; delivers but especially plastics, the princiabove 16 HP, and there are big pal one being fiberglas. Further
70 HP beauties that zoom lithe support of this trend was given by
water skiers along abaft
at 35 Admiral Mumma at a meeting of
arm;
clamp
was
bond markets has emphasized
Washington is endeavoring to allay the
renewed efiort toward balancing the budget
have been paid since 1936 and the
common stock was sp it 2-lor-1 in
J9f5 T1/"1?1.'1 ln,
w'ih a
st°ck. dividend in March pi
1953'. follcy. bas been to retain
vertising expenditures.
their hawsers in 1958.
a
Federal
The
paid
emerge
alu¬
and
industrial production rose to 133% of the 1947-49 average in July
from
131 the month before. This is the third straight monthly
should
painting. There will also
steel
for
indexes, it is reported, government officials are of
opinion that price trends of consumers goods will play a major
curbing fears of inflation.
,
earnings,
advances
role in
Jared splendidly. Cash dividends terial tor liber glass boats of the
about two-thirds of net
price
non-food price
the
hv
Outboard has slackened in earn- "ber plastics and the building and
Ions of gas, and 20^ million gal- mgs this year due to production sales of the boats themselves.
Ions of diesel fuel, in 1957.
And start-up
costs
in turning
out
Another interesting facet of all
all of these statistics are breaking larger motors, and to higher ad- this pleasure boating is dockage
380
and
for concern.
official
and
Following
have share in turning out the base: ma.
OMM
increases
causes
other steps to
was
;.p
the horizon/. Our 'bver-
over
deficit, along with the Near East problem and
public's fears by
and
around
been
■
behavior of the stock and
threat
far
so
are
The
this
u
common
Federal
wage
minum
p
shares are
ooo
over-the-counter
that orders have topped output l'orj
improvement in Homebuilding will step
This
As the nation's economic picture brightens, the threat of in-*
Here again growth has been ranid
mu
the
Association,''
months.
Ration casts its unwelcome shadow
sells
is
stork
common
with
demand lor other types of building materials and consumers
durable goods as well./ ' ? * /
"!VM ' /•'• •" :r
L. O. F.
Glass Fibers Company with 50.3%
0f
negotiations
up
second largest compaii^ ui
million 111 19.)7, The 2,707,033
vviji
crossed
..
"627
g
y
•,?
year.
$3
onlv
(fiscal year
to
%
Net
progress.
were
sup-
membership,
seven
1950
rfPfj
in an(j
laid
was
haulage,/dockage,
which
in
Doating
billion
and
btates
took
recreational
markable
Utiles in*!//*-,
Tlnited
united
14 rec^canonai
1957.
note
mdustiy. the outboard picture is
■
Twenty percent of the popuia1 ion
to
solid
two
indicated 80
important ining to note in liber glass manufacture
contract
pickup in housing starts has stimulated the lumber
industry, which reports through a spokesman, "The West Coast
some
Th»k imnortant thinp
inHn«frv
does'
1L.aucb-
'
through
their
of
backlog ol honiebuilding work which will extend well into the '
Lumbermen's
boards are distributed in the U. S,
swiftly
outcome
autumn/ This
cent dividend. It appeals more to
7,500 retail dealers buyers in search of long term cap¬
ital gain than to investors for indawned
on
me
we
that
were
who
are
very
proud, indeed, of
viewing,
or
passing,
a
dozen their franchises. The other prod- come.
pleasure boats a minute; and that ucts are distributed, for the most
i„ o. F. Glass Fibers Co.
this leisurely aquatic pastime of
part, through hardware jobbers.
Thp'QPrond
mmnanv
in
as
raced
the
/Housing starts too, have also contributed their share to the
upturin in business by rising to a yearly rate of 1,160,000. the larg¬
est' gain covering a period of more than two years and creating
-
-
Evinrude
ers.
Whiting
United Automobile Workers Union.
by
large scale maker of motor scoot¬
v
back and,
the shore
Failures
Indications the current week point to continued improvement
in the country's economy. In the steel industry, production at this
far, the largest producer of out- as
j
:
Marine
Business
7
plastics in such diverse products
fishing rods, awnings,/house
boards, and its model lines include partitions, motor car bodies—and
the Evinrude, Johnson and Gale pleasure boats. :;,y:;"//
Buccaneer
brand names, with
Growth of Owens-Corning has
units running from one cylinder/be®n remarkable with net sales
"three hp. jobs to four cylinder 50 rising from $481/2 million in 1949
li'p. engines.
There is also the 1° $163 million for 1957.. In .the
Lawn Boy division, making power same period, net income advanced
mowers,
and
Cushman
Motor lrom
$2,280,000 to $9 million.
Works division (acquired 6-0-57),-Stock is listed on the. New York
after- ;
of
deck
particular.
Corp. in
town
idesk, for a
/ steamer chair
Industry
Owens-Corning Fiberglas
fiberglas manufacturers, a swift
look at the two largest in that
board makers in general, and has business may not be amiss. The
a
mood of sheer indolence,
a
and
m.p.h. All of this has, of course,
been a wonderful thing for out-
July
correspond-
began
Index
Price
Auto Production
under.
Since this pleasure demand may
prove
article
Trade
Commodity Price Index
Food
talking
was
Retail
State of Trade
wane;
materials.
Output
Carloadings
boat
wooden
Production
Electric
he
Navy preference
Enterprise Economist
This
that
stated
Steel
The
and indicated
lor plastics and
U. COBLEIGII
DR. IRA
By
Mumma
Thursday, August 21, 1958
.
Boat
and
of
—And
.
.
WALNUT 0316
ATLANTA
1, GEORGIA
LONG DISTANCE 421
31
Volume 188
Number 5770 ...The Commercial and
Financial Chronicle
ings at
decline
a
last year,
Observations
.
.
of
161//2%
coal and iron
from
ship¬
ments more than cut
in half, re¬
duction of the price of lead to the
lowest
level
since
1950,
April,
.
5
(705)
ore
Under
almost
Notes
NSTA
etc., etc.
By A. WILFRED MAY
definition of
any
"inflation"
The New Dollar Diplomacy
UNITED NATIONS. N. Y.—At
high is economics
new
as
unwillingness
"have"
the-wealth
domi
rent
tio
the
to
not"
region. The
Government
indicates
zeal
with
to share its
West's
encouraging, with
convoca-
business
new
relevant.
subsidization,
Assembly
tries, will wreak
of
of
to
Secretary
separate
marskjold and
day at the time of Iran's national¬
e n
t
amelio-
rating
And
the
tion
Middle
East
crisis.
The
P
Wiitred
A.
must
proposal, the lone word from the
Summit, envisaging a sizable con¬
tribution
to
collective
a
set-up,
aid
the
pressure
of
is
departure from
policy of extending
constructive
a
effort.
,
divorce
tributors
the
of
control
from
con¬
The
expenditure of their largesse.
This
relinquishing
control
expenditures will limit any
affiliation with the World ^Bank
of
advisory
the Bank
of
no
doubt
gesture to capitalize on Eugene
Black's
good
"public
relations"
with the Arabs). Surely the Bank
have
will
moving
its
in
come
the
irL
just
Monroney
soft-lending, which
for definitive action
of
up
session
next
full
the
to
over
Plan-type
will
hands
of
Con¬
the
gress.:
'
•
'
Although
-
President'^
the
pro¬
sponsorship of
idea (irrespective of whether
the
it
our
filched
was
from
:
Mr.
Ham-
marskjold or from Secretary Trygve Lie's U. N. staff in the 1940's)
will
presumably entail a Moscow,
if not an Arab, "veto." But there
are a
number of fundamental sub¬
stantive
justify
to
the
represents
stock
a
been some
FED's re¬
against
move
But
market.
must
we
remember
its
prescribed
duty.
Primarily it is to curb the amount
of credit directly going into the
market.
Specifically, the Secu¬
rities Exchange Act
(Section 7)
,
of
directs the Board of Governors to
and
to
non-Communist nations.
As
a
obstacles.
nation's
the
of
re¬
credit
have
been
out
of
other
of
desirable
more
commerce
prevent
arid
industry
a, recurrence
—
to
of the pre-
where
situation.*
Crash'
uses
funds
which would otherwise have been
available at normal interest rates
for
consist¬
New
In
of
uses
local
"Com-;
Financial,Chrbri■
the
York
to;
man'
in tfie- Year
contact for space
John
is
Book
Lee
In
other
of
will direct you
S.
Higginson
the
affiliate
of
.^
J
t/ij.
I
November
rate
commerce,
in¬
dustry,
and agriculture, were
nullified by tlicir general
drained by far higher rates into
unreliability,
deliveries
unsatis¬
security loans and the New York
factory as to both time and qual¬
call market."
Also the Congress
ity, price juggling, non-competing
had in mind the prevention by
credit restrictions, attachment of
the margin requirements of un¬
political and commercial strings,
due market fluctuations.
Ap¬
and the pervasive difficulties en¬
praisal of the market price level
countered by free enterprisers in'
is not the concern of the author¬
doing business with a state-con¬
ently
reduced
not
aid & Company
until
by a
in the
charged by New York Stock
slowly
followed
only
of merely 22%,
drop
rate
firms.
likewise,
and
the
public.
Conclusion
Exchange
And
over
the
affecting
4V2.%, had
clusion
to manage
how
in
stock
market
Significantly, imponderables
similarly confronting the
are
British
have just
direct response
business
or
touched
or
like
market
rate
on
currently
as
by the London Econ¬
omist thus: "If a Chancellor could
at
depression on
discount
The
business.
1929
October
the
so
who
order demand within the economy
July 1928 preceded by 18 months
crash and the break
money-managers,
again reduced the bank
4^2%,
to
rate,
re¬
Conversely, the discount
rises of February, May and
covery.
rate
the economy, no matter
and • conscientious,
expert
must in time be self-defeating.
to Nov. 4, 1921,
no
present
re-emphasizes the con¬
that non-essential moves
situation
net decline from (P/2
a
to
the
observer
this
To
long-
term, has there been a lack of
ready correlation between credit
controls oil the one hand and the
stock market or the state of busi¬
ness on the other.
The five suc¬
cessive reductions in the discount
rate from May 5
change denotes pol¬
exceeding
a
mere
money
market realignment, as with the
short-term bill rate, there should
be an authoritative explanation to
icy
January 1958; and the halving of
the discount rate by April was
net
0 ■': -;
New York 5, N. Y.
rate
current
call
the
yet
1957,
was
Tlsch
wALFREDlJTlSCH, Chairman
Nationaltft'rwtiai
(jvertising nnmmiH
Committee/ *a ,:'"r
-'•. '"c/o Fitz?
loan
F.
Alfred
NSTA
the
to the local chairmen.
f
in
of
Parker
Corporation.
cities, the President
Herbert Singer
resources
which can be directed by specu¬
on-the-spot survey in West¬
lation into the stock market and
Europe and the Middle East
Russians
Conventionandv
40 Wall Street,
inability to pay, it passage of the Act: "The main
[of the margin provi¬
realize that this purpose
is to give a Government
has constituted only one of sev¬ sions]
eral reasons for the low level of credit agency an effective method
business between Communist and of reducing the aggregate amount
important
the
of
enough
'
con¬
enlarge¬
supply. This
Again, there has
conjecture that the
the
posals were of course advanced
ern
with complete sincerity, a host of
this
writer
disclosed
(as
practical difficulties will no doubt by
confine their practical/.effective¬ reported in detail in an article,
"They Tried to Do Business With
ness to the propaganda area (per¬
the
Soviets,"
in the "Reader's
haps - even
successfully" substi¬
tuting economic for ballistic black¬ Digest"), earnest efforts to do busi¬
ness
in non-strategic goods with
mail). '
fact
and
money
Russians'
the
cent
The
deficit
the
subsequently main¬
on any registered security.
which has prevented a high level The statute also speaks in terms
of East-West trade.
of "preventing the excessive use of
While many have realized that credit for the purchase or carry¬
permissible trade has been, and ing of securities," substantiated by
will continue to be, hindered by the House report at the time of
is
again
"
;
half page ad in;
a
mcicial and
capital financing.
ganda line that it has been the tended
embargo
on
strategic materials tained"
(with the President's in¬
volvement
a
informal
completely7
services
for
NSTA
^accompanying: hindrance•>to
new
announcement
the
the government's fis¬
easing of the Western restrictions prescribe rules from time to time
on exports to the Soviet bloc will
"with respect to the amount of
put to the test the Soviet propa¬ credit that may be initially ex¬
over
to
current
a
essentially is perhaps a cou¬
—
and
discommoding—
against the Treasury, deemed
the
To the Test
the
over
.
as
has
who
tracted
ensuing threat to the already un¬
settled general bond market, with
a bilateral basis.
Moreover,
propaganda arena.
definitely understood that the
President's
plan
contemplates
East-West Trade Promises
complete
of
important
citizenry must not delude itself
the
concerning results — outside the
on
in
billion
versal
it is
effective—even
be
firm
rise in the discount
a
rageous
well
But
"adminis¬
operations, with its impending
tion
our
as
the
move
Israel,
on
of
implies the question whether the
FED's apparent reversal of direc¬
ques¬
overall
multiplication
managers'
iele."
ment
Truly the President's program,
clearly and succinctly presented,
distinct
previous
our
the
problems, there-rrQconomic
as political.
institution,
development
a
of their
with
U. S. support to an inter-American
marks
doek
it
as
firm of Sing- !
er> Bean & Mackie, Inc. have
successfully subscribed to this;
■program
and this week we
salute
Herb
Singer of that |
Tnc
Year Book issue of the
cal
ultimately lead to intensifi¬
cation
coming the day- after Under Secre¬
tary
Dillon's
announcement
of
regional
overhanging this aid
too,
facets
can
$12
political phases, is Israel. Major
strengthening of the Arab bloc
May
sident's
r e
indi¬
ization move, would be lost.
E i senhower
for
with
advertising.
intelligent and continuous
is
pays
centered
vidual countries, which saved the
Pre sid
negotiations
ir¬
that
psychological gesture. Actually
expansion and any inflation are
our
General Ham-
only publicity
a
how
see
rate
severe hardship
European friends. For the
bargaining power derived through
on
seem
The
ASSOCIATION
SECURITY TRADERS
NATIONAL
anti-
tered" price process, it is difficult
bargaining by all the
oil-producing Middle East coun¬
the programs
is
otner
or
of
General
an
price rise stemming
prospective wage increases,
from
viewooint, the
federative
of the
n
as
tne money
jli
concern
Syria.
or
borrowers
inflationary step would
no
oil-wealth
Egypt, Lebanon,
From the
cur¬
relatively lesser
amount
of
goods"), a present move against
a
share-
"hm^e
great
nance
the
countries
with
(as, for example, "an
supply of money chasing
excess
oil-rich
Iraq
diplomacy. This is clearly demon¬
strated by the
over
the
members of the
instrument of international
an
Arab
a
placed
now
of
-
housewife orders supplies
a
the
■
grocers,
therefore,
Amory might well choose that
re¬
Mr.
the
1» 1929 pre¬ demands laid upon British indus¬
ceded by three years the ensuing try towards the end of ~this year
business
and
market recovery, should be a little higher than
ductions begun Nov.
larly
was
there
and market
a
he
long business
hikes
In
or
mand
doomed
There
is
1950;
in
any
1948
or
event,
insofar
as
significant
further
aiv
they will be? : Or
from the rate
April and August 1955.
January
of
rises
August
no
towards
easier money
thrit
isinternal de¬
policy, is there any chance
27, 1937; and no
business-market effects from, the
rate
makes
moves
lag after the rate re¬
duction of Aug.
being laid upon it now. If
those
late 1932. Simi¬
started in
which
versy
ets of
the
more
fall
to
room
further?
for contro¬
about this than some proph¬
depression seem to grant."
ities.
trolled
Specific Difficulties
Even-if
devote
economy.
Thus
*
we
are
now
willing to
aid, via money and
technicians, through the United
Nations, will our co-contributors
be willing to go along thus in¬
directly?
our
Not even the wizardry of Mr.
Hammarskjold will overcome the
course
with
the
record
of
the
of attempts to do
the
Soviet
bloc
actual
business
is
one
frustration, constant irritation and
mutual
distrust, with exceptions
occurring only when prompted by
political strategy.
Sfc
$
FED
Again
"controversial
having incited
EQUIPMENT
on
character."
a
After
successive charges
through fast enough, iri re¬
versing themselves out of the 1954
ing
BOUGHT
—
SOLD
♦
f.
MORELAND & GO.
Detroit
1051
Stock
Stock
Exchange
Exchange
Penobscot Building
DETROIT 26, MICH.
DE 75
WOodward 2-3855
Branch
Office—Bay
City, Mich.
two
an
relevant
elements,
market
and
ty by sanctioning a rate rise midst
a
presumed recession period.
Though real recovery may be on
the way, random news items still
show unemployment at the nasty
five million
down at
level, steel operations
60% of capacity, carload-
Small-Milburn Company, Incorporated
; The
excessive amount - ,of
credit
fluc¬
announces
the change of its name to
tuations, which are possibly pres¬
ent now,
have been fully treated
by the Fed's margin requirement
boost
of a fortnight ago, which
antidote and not a rediscount rate
Interest Rate and the State of the
Market
Even if
MILBURN, COCHRAN & COMPANY, INC.
Interests of Amos C*
and Wes L.
of
use
and
Business
of the discount rate
for limiting the
amount of stock market credit in¬
be deemed proper
flow or fluctuations, or for lower¬
depression; of too slowly reacting
to the 1955 boom; of acting too ing the market price level, it could
be made effective
only via in¬
drastically in curbing the 1957-58
juring business generally. Surely
boom; and of negligent tardiness
it would be senseless to engineer
in easing the rate at the onset of
a
reduction in business activity
our
current
(recent?) recession;
and earnings for the end of knock¬
the FED authorities now surprise
ing down stock prices.
and befuddle the entire communi¬
Members
Midwest
market
fective.
the Spot
of being too late or of not follow¬
Com. & Pfd.
' These
namely,
rise, is in order and possibly ef¬
Again the Federal Reserve is
MONROE AUTO
of
.
our
firm.
Milburn, Cochran & Company
rate
does
not
directly
which the predecessor
active, and will operate its present four
following personnel:
company was
with the
offices
Glenn L. Milburn, David F. Bradley, Albert
L. Brokes,
David E. Davidson, Warren B,
WICHITA
L.
R. Zittel
Gillespie, Theodore A. Hartenstein, Duane
Krug, David E. Wire, and Walter
OKLAHOMA
William
CITY
*
Cochran,
B.
W. Davis, H.
Schmoldt
KANSAS CITY
Mason H.
John T. Barry, Phillip
Hugh Mclntire, and J. Herman
'
Feese, John B. Markey, arid
Archie
L. Drake
HUTCHINSON
George
H.
Ewald,
John
J.
Knightly,
and
Lewis C. Taylor
affect the charge for stock market
credit, or at least without a good
time lag.
Typical is the record
during the past year. The discount
rate was lowered from 3V2 to 3%
will continue to engage in all
phases of the securities business in
We should also realize that the
discount
Smith
officers
Small, Don M. Small, Duano T»
Keating have been purchased by other
No
changes will be made in office addresses or
and teletype numbers. •
telephone
6
The Commercial and Financial Chronicle
(706)
production
general and natural gas in particular are contained in Mr.
Parson's paper which sees "at least four decades of expanding
competitive energy requirements
52% in 1955 to 74% in year 2000 and only
will there be some supplementation of synthetic
centage of gas in increasing
doubts
gas
atomic
no foreseeable factors to lessen competitive
compared to oil and coal in next 40 years and
energy is a serious hazard to gas industry.
developing
demands for energy
mates of the
in
general
esti¬
long-range
and
pa r
is
in
gas
attributable
been
I would hope
both willing
and able to develop
At the
revised realistic estimates.
present time, with the facts as
they currently exist, I think the
following analysis
is
the most
reasonable one possible.
tic ular,
one
natural
imme¬
diately
im¬
pressed by the
multitude and
economic
of the basic stepping
forecasts, one
stones
is
estimates
In
necessary.
sort
the
crystal
ball
old
is
population in the year 2,000
from
such
organizations as the
ing
longer
requires
Census
one
Daniel
Parson
appropriate
the
rapidly changing current
technology.
world of
The
.
,
first
question
that
one
.inevitably faces is how far in the,
.
iuture
look.
to
reasonable
I
have
thus
and
1975
least
at
a
of still being
assurance
in
around
might
have to defend my estimates, and
little chance that I will survive to
the
obvious
latter
it
2000;
year
that
year
thus
should
I
word
select
about
c
<
•
the
the
date
of
this analysis. Many prophets of
doom and gloom have been stating
for years that natural gas supplies
tvere in imminent danger of ex¬
haustion, and some have recom¬
mended that available supplies-be
reserved for so-called -"superior
use,"
purposes. for
which
the
chemical composition and form of
gas are peculiarly suited rather
than representing merely a source
purposes
of
Btu's.
One principal purpose
of studies of the sort which I will
The
the
Security Administration.
Attempts
other
Re¬
Board,
Future, and
the
organizations
pound
utilized. In the first, attempt
proportion of total demands
by
non-competitive
was
reviewed
and
extra-
represented
uses
examjna-
after separate
polated,
trends
in
each
such
such,
but
total
of
rates
consistent
with
of
which
ing
nearly
more
rate
1975;
a
long-term
aver¬
un¬
the resultant estimates of ultimate
crude oil reserves is
multiplied an
assumed gas-oil ratio to yield ul,
Ratios
/
.
" Committees
A.G.A. mid "A.P.I.
smaller than that dur-
preceding or. succeeding.; all intervening five-year periods
would be applicable in show a consistent and .virtually
Using this rate of uninterrupted upward trend. In
the
future.
growth, the proportion of total .1957 alone the ratio- was- 7,10()
competitive energy requirements cubic feet of gas per barrel of
which
will be supplied
by„ gas;^ oil";added to reserves./For, purwill increase from 52% in 1955 to>, poses
of
this /analysis:-;I~/have
,
considerable
research
field; to obtain such
ment is
inconsiderable
no
plishment in such
an
accom¬
where
the demand for natural gas. V,
in
agree¬
area
to
conclude that
a figure of 200 bilremaining, is realistic.
Of this amount
are
billion
30
,
/,
barrels
/attributable to currently
-
proved recoverable reserves, leav¬
ing 170 billion barrels still to be*
After
thus
determining'
demand
lure
natural
for
■
utilized by Bruce Netsehert of -Re-
For The Future in his
gas/en- recent excellent publication called
the fu-
serve
For
these figures.
crease
conservatism
In the interests of
also
have
I
ignored the ultimate
and
Canada
of
reserves
,
Mexico.
considered, that'
will total!
substantially, more than 100 tril¬
It
is
generally
Canadian
reserves
gas
cubic
feet,
large
a
which will ..probably be
after
various : Canadian
Govern-'
completed
deliberations, for export to!
mental
their
have
groups
also
It
States.
United
the
of
part
available,'
.
{
seems
that substantial reserves!
in
Mexico, / although
no
likely
axist
estimates: have
'
quantitative
Let
this
how
see
us
yet
;
attention.
to my
come
estimate
cubic feet com-"
with estimates prepared by
rived. ! In the, five years; ending
1951. this average was 4,000 cubic
feet of gas per barrel of oil; for
the five years ending
1957 the
year 2000. Let me em4
adopted the conservative assumpwhich,we phasize that this represents a con- tion./ that' the; gas-oil ratio will
concurred in by sistently
conservative
approach / remain at its present level-ofs7,000.
reputable organizations which toward historical rates jpf .growth, This same assumption, has-been
done
«
.
which
me
others.: About one year ago Lyon
research. The estimates
have
estimates
upon
prepared, leads
were
of
have adopted- are
in this
various
the
assumptions
gas7oil ratio... for- recent
exploratory activity can be., de-
serves,-,a-
during 1930-1950/ ratio was, 6^720 cubic feet of gas
per barrel,, apd. the averages for
growth
was
decades,
the
of
as opposed
to postwar ex¬
perience; and some improvement,
in life expectancy to reflect the
continuing
advance
of
medical 74% in the
ages,
two
they
lion
.
.
to analyze are t analyzed, by dividing/gross
the percentage, additions to natural gas: reserves
competitive energy sup-/,by gross additions to crude oil re¬
total
of
on
current
of
levels
to
in
based
are
slackening
gradual
birth
million
230
estimates
appropriate
was
people study we adopted the conservative
the United States by the year alternative and assumed that the
These
have
to
derlying /geological ' formations
suitable for the accumulation of
crude oil and/or natural gas. To
competitive energy requirements^ Historically the trend of gas-oil
for purposes for which gas can be-. ratios has been
increasing signifused, increase from 19.5 quadril- icalltly ,;in recent years.
If the
lion Btu in 1955 to 47 quadrillion,
annual, reports
of tne* Reserves
million
2,000. Implicit in this estimate is
a
of
the
of 1,435 trillion cubic feet.. 1
this!/paper/ I have adopted!
proveh reserves. ^
V v
1,400 trillion cubic feet. It should
' The generally accepted proce- be emphasized that these relate,
diire for estimating total ultimate only to recoverable reserves based
on
current
production methods,
reserves of natural gas is to es~
timate ultimate reserves of crude rather than to total reserves, and; '•*
oil by determining-.the .amounts any subsequent/ technological im-; r
provement in the proportion ; of
Gf crude oil so far found per acre
explored,
and
multiplying
this gas in place which can be re¬
covered economically would in¬
figure' by the number-: of acres
,
were unavailing.
Aflerj plied by gas. This has been; in-,
inspection ol' the various forecasts,, creasing substantially since 1920.,
we have concluded that the
most' and the growth has accelerated,
realistic
projections
specify
a substantially since 1950.
For this
of 330
Nat-
on
procedures yielded results which
differed by less than 15%, and we timate gas reserves.
*
used the average of both results' '
*
<
■ ;
,
' • ■
for our
final figures.- Thus the Upward Trend in Gas-Oil
attempts
population
Committee
The
known
In
area.
to obtain in the year 2,000.
variety of
Our next step
as to com-, historic trends in
so
non-
the second
approach we examined historical
information on competitive uses of
energy and developed projections
of these for the. future. The two
a
confusion,
our
procedures
Two
future.
the
were
made
were
similar forecasts from
in
became
the terminal
as
for these analyses..
A
Conference
For
sources
Social
National In¬
the
Bureau,
dustrial
a new
version
for
We
both formal and informal, regard¬
no
adequate;
future
of
have been ex¬
variety of forecasts,
population.
posed to a
study of this
style
in
competitive
As with most types of
which become
a
/
at-
have
and
areas
tempted to determine the proportion which will be non-competitive
tion of
Population Estimates
variety of
assumptions
Natural' Gas "/
.f
demands in the past have awaits our discovery, and utilizato ...these non-, tion substantially < exceeds these
energy
to warrant re-examination,
that A.G.A. will be
pears
,
Supply
ination
and
are
competitive
When faced with the assignment
of
considerable
a
certain types of uses ural Gas Reserves recently issued- discovered. -If this 170 billion bar¬
gas its estimate of 246.6.trillion cubic rels is multiplied by the gas-oil *'
cannot
compete
because of its feet of. proved recoverable re-, ratio of 7,000 cubic feet per barrel;
physical characteristics. These in-, serves at the beginning of 1958. we find thaL there are still 1,190/
elude such uses as motor vehicle These estimates include only gas - trillion cubic-feet, pf. gas to be
Adding to this the*""'
fuel, fuel for railroads,;, and all proved by adequate drilling and c discovered.
purposes
in which the energy^; various reliable geological* hn<i current proved recoverable re¬
consuming
unit is " mobile.
We engineering tests. ;~ The sLo t a-1 serves of 246 trillion cubic feet
have analyzed the extent to whicli '.amount
of 'natural "gas;.which yields a total remaining U. S. re¬
There
.
will rise from
position of
that
exists among the estimates*
of tnese specialists. Careful exam- -
for energy for which natural
industry operations with the industry becoming even more
dominant as a supplier of energy to the nation." Notes per¬
1990
It is apparent
lion barrels
Competitive Energy Requirements
.
gas
Perceives
feeling
my
range
The
in
gas.
It is
consideration. The gain is from
American Gas Association
figures to explain long-range estimates for energy
after
is rather limited.
40 previously for estimating future
quadrillion Btu in 1955 to V112- energy demands of the country.
quadrillion in the year 2,000.
By DANIEL PARSON*
Facts and
trend in only one
Thursday, August 21, 1958
.
.
|that the use of Putnam's proceMultiplying the population esti- dures,while they may theoretically
mates by
the estimated demand be more valid, is severely limited
for energy per capita provides us by the absence of reliable stdliswith total energy requirements of tics. This accounts for my decision
the nation
for the years under to utilize the procedures described
Long-Tei m Outlook for Energy
—Including Natural Gas
Director, Bureau of Statistics,
can
direction—up.
.
sources
pares
,
Terry and John Winger estimated
proved recoverable reserves"
ultimately
aggregate
at
that
would
trillion" cubic
feet/* >
in his / recent *1
publication, has agreed withsub/ux
stantially this level. A represen- <
least
1,200
Bruce
tative
Netsehert,
of
States Geo- .<<
United
the
logicai:'?Suir.vey > indicated - in - a :
speech before a group of NARUC; .:,
engineers that ■ ultimate reserves ■-/
would aggregate
between
1,150; ~
and 1,700 trillion cubic feet.
It is
my
inclusion that .the estimate o
of 1,400 trillion eubjc-feet is real-!,
istic,- and may ultimately .prove ,
,
conservative because of the influof higher;
ence
Growth
?
<"•
Additions to Proved
of
.
;
gas-oil ratios and
improved recoverability.
of Oil and
throughout the economy, an; ^The Future Supply
multitudes
of
economists
and
soon describe is to analyze
adjustment was made to add nee- Gas."/,
;
•
objec¬
demographers
will
argue
the essary extra amounts represent-! v.; There
are
good • reasons
for
tively the merits of any such
merits of their own estimates at
ing some minimum unavoidable; assuming that this "ratio is- very
.arguments. Another obvious aim
the drop of a hat.
is to explore the magnitude of
production
waste,
gas
lost
in conservative. In the jiirst place
transmission, and similar amounts the trend today is deeper drilling
available future natural gas sup-,
Projects Per Capita Energy
necessary
to get gas to market, and future technology "will
unplies and the economic conditions
Growth
but not consumed by the econdoubtedly facilitate and accelerate
'upon
which such supplies will
After this correction, net this
trend.
As
depths become
depend, as a guide to far-sighted
The next step was to analyze omy.
gas-oil
ratios
increase
managements regarding long-term for a period of past years the production of natural gas must in- greater,
planning
of
gas
systems
and trends in per capita use of energy crease from 11.2 trillion cubic feet markedly; and the proportion of
in 1955 to 36.6 trillion cubic feet wells which discover gas or disr,
needed major-expansion's, ■ and to within the'
.country* These show
evaluate
the
relative
reliance a reasonably consistent trend since in the year 2000, if it is tot supply tillate as opposed to crude oil also
the previously postulated demands
which must be placed by the na¬ 1940 and for the
increases.. Furthermore, with the
years prior, to
for natural gas.
tion on "unconventional" energy 1930
/
'
burgeoning demand, for natural
(although the intervening
ergy
trillion
1|400
Reserves
;
,
...
.
.
.
.
such
isources,
as
atomic and solar
^
No studies of this type
sible
without
tions
and
possible
numerous
estimates.
such
-attempt
feasible,
which
to
assump¬
Wherever
assumption
be
and
will
are pos¬
to
be
as
should
realistic
utilize
as
concepts
conservative
in
their impact upon gas demand and
supply
wherever both conserva¬
tion and radical alternatives seem
^equally reasonable. This approach
has been adopted
uniformly in
this paper.
One
is
so
constant
as
change.
The
pnerits of periodic re-examination
of long-term energy demand and
supply
estimates
thus
become
evident. Whenever any revision of
current trends or economics ap¬
*From
talk
by Mr. Parson before
Spring Conference of A. G. A. General
(Management Section, Washington, u. c.
a
If this trend is
of
extrapolated,
242
million of Btu
million
in
1975
in
1955
to
to-340
and
285
mil¬
lion in the year 2000.
There
sume
are
that
growth
good
such
reasons
to
extrapolation
as¬
of
in
energy per capita is
realistic. Assuming the absence of
a
destructive atomic war, I am
sure no
one
will
doubts that
continue
our
its
turn
we
supply
to
econ¬
long-term
to
discussion
a
ascertain whether
can be met, and to
a
review
of
the
relative
forecasts which has been used
Palmer Putnam in his
by
book, "En-
in the Future." Mr. Putnam
former
are
the
amounts
of
fuel
ization
ful
over
the
energy
derived by the users;
long-term; these, inevitably, will Because of improving efficiency
higher levels of energy rates and the changing proporrequirements per unit of produc¬ tions of different types of use,
tion.
Additionally, demands for each with its own characteristic
require
shorter
leisure
work
will
velopment
weeks
and
necessitate
of
higher
the
more
de¬
industrial
search for gas .will be created by
gas price increases in the field,
making the development of new
has differentiated between energy- gas
production
facilities more
inputs and energy outputs.
The! profitable.1
.
v
ergy
trend toward increased industrial¬
automation
substantial number of oil com-
proved reserves and ultimate
of continued growth in;
reserves,
of
production
a
gas, up to
trillion cubic feet '
natural
36.6
of
level
It is also neces¬
simultaneously, to explore
prospects for additional dis¬
in the year
2,000.
sary,
the
coveries of
natural gas.
Analysis
of the
indi¬
additions
to proved reserves have been in-creasing at the rate of one trillion
of
the
,
cates
annual
reports
Reserves. Committee
A.G.A.
annual
that
gross
cost
produced and consumed, while the
latter concept represents the use-
and
is little doubt that a
there
gas,
on
step
panies will more vigorously exAssuming
plore for gas per se rather than cubic feet per year.
structures of the various fuels to finding it as a corrolary of oil that adequate economic incentives
exist in the future, and that the
determine whether such consump-' exploration.' One major oil comcost of natural gas remains com¬
tion will be economically feasible, pany has already recognized this
let me mention one different approbability in its managerial phi* petitive so that the consumption
proach
toward
energy
demand losophy. Further impetus for this and production projections previ¬
these demands
we
find that per capita use of energy
in this country will increase from
omy
further
thought — we all
realize that nothing in this world
'
depression decade does not agree
with this trend).'
•energy.
Before
is to develop a/
schedule showing the impact, both
next
The
-
combustion
in
efficiency, the trends
input and output
are
Unfortunately available
different,
informa-
productivity, and here, once again, tion
regarding
historical
effienergy requirements per unit of ciency rates for fuel consumption
*
,
„
,
,
_
Postulates Gas Reserves
A
-
number. of
people -have
de-
veloped estimates of ultimate oil
reserves.
Some of these, adjusted
to
omit - cumulative
production
.
through
such
of
as
1956,
specify
246 billion
amounts
barrels
(Dept.
the
Interior), 195 billion barrels (Messrs. Hill, Hammar, and
Winger of the Chase Bank), and
145
of
billion
barrels
Degolyer
and
(John
Murrell
MacNaughton).
-
ously set forth will remain real¬
istic, there seems to be no reason
why
future gross
additions to
proved reserves could not increase
at the same rate as in the past. In
spite of dire predictions regarding
the impact on new gas discoveries
which would result from failure
to
free
producers
regulation,
proved
to new
in
gross
Federal
additions to
from
gas reserves attributable
discoveries reached a peak
1957.
Surely
some
generally
acceptable formula to eliminate
the possibility of producer regula¬
tion under a public utility concept
will
be evolved, with a
conse^
miont
oppolorotinn
in
pvnlni-ntinil
,
Volume 138
Number 5770
The Commercial and Financial Chronicle
...
efforts
assuming, as I said before, proved reserves equal 50% of to¬
adequate incentive and reason-, tal reserves, and because of the
competitive price. And the 6% limitation on net production
(707)
cant
is
gas
there,
waiting
to
dis¬
be
covered.
I
as
a,
supplementation-by synthetic
natural gas.
able
Some
of the
people have
uiilized
proportion
serves.
of proved re¬ called "decline curves" to
The schedule indicates that/
mate the maximum annual
have
so-
esti¬
pro¬
in the year 2000 total reserves will
still be 462 trillion cubic feet, of
eries and withdrawals
;
that in developing
these schedules of annual discov¬
which 366 trillion will be proved^'
occur.;' This procedure has certain
recognize
avoidably dependent
of assumptions.
to-evaluate
are
we
on
un¬
variety
a
Any criterion used
these
estimates
must
subjective
judgments regarding their reasonability, and a review of their ef¬
fect upon remaining gas in the
ground. I have assumed (a)-that
the rate of new gross additions to
proved reserves will continue up¬
necessarily
depend
with
ward
on
increments
annual
of
trillion cubic feet per year
1
until
such
time as remaining proved
reserves are equal to one-half of
total remaining reserves; (b) for
subsequent years (and 1977 is the
in which this event occurs)
year
the
ratio
of
remaining total
cline
in
the
fashion
date;
in
to
wishing to
adopt different basic assumptions
could develop a schedule which
would differ to
mine,, and
the
ture
be
defects
merits
of
this
of
na¬
which
appear
to
me
to
•
them
more
facilitate
natural
for
individual
sub¬
vary
other
in
evaluated
Sources
*
"
Costs of Alternative Energy.
I
some
permeable,
-
greater
and
gas,
and
.
recovery
I
am
sure
amine
to
T
of in term of consumer economics?
that and interfuel competition.
/
underground
by the
story regarding the
atomic explosion in
Nevada* and
the
news
possibility
atomic energy might be
of
means
increasing
oil recovery.
and
ties
the prospects for relative
prices to determine whether
these demands for gas are realistic
fuel
of you were excited
recent
have
touched
means
are
being developed
fracturing formations to make
ous
lor
outweigh the disadvantages of the
developed.
curves
..,
attempted to.* show that
briefly on the reserves and net production will
possibility of improved recovery * be adequate
to support vastly
of
natural gas because of new
greater demands for natural gas,
technological developments. Vari-' at least to 1990. Now let us ex¬
schedule which I have
gas-producing fields
stantially
from
each
for development.,
schedule which I
^presented.
have
I
The decline
•
only sub¬ shape, - immediacy with which the
jectively.*"' My
schedule,
which peak year is reached, and rate of
looks
realistic
to
me,
indicates decline in production after the
that there will be enough natural
peak year. There is no one gen¬
type
of decline
curve
gas for the expanded' demands of; eralized
which can be effectively defended
the economy
through 1990; and
that in the year 2000 substantial against
numerous
alternatives,
and the problem of developing a
amounts of natural gas will still
composite decline curve for the
remain in the ground, although
entire
national
supply presents
the rate of withdrawal will have
problems
substantially
greater
declined so as to require signifi¬ than those implicit in the assump¬
can
future
characterized
future; this is an exercise
prognosticating in which even I
quantita¬
are
We
familiar
all
are
1
e»
-
This is not
.
.
of
prices of natural gas. This average
discoveries,
withdrawals, and
trends
-
in
average
Continue
reserves.
offer to buyy
an
any
of such securities*
.
exceed, in any
individual year, 6% of the proved
recoverable
If
all
ported
FP.C.
reserves.
production
by / pipelines
Houston Corporation
trans¬
subject
to
regulations, the ratio based
current
on
■
were
regulatory
thinking
could presumably not exceed 5%.
H:°
wever, not
to market
all production
through. inter¬
moves
state pipeline
5% Subordinated Debentures due
the gas industry becomes
more mature and its reserve posi¬
tion starts to diminish, some mod¬
ification
F.
P.
liberalism
and
of
20-year supply require¬
ments'will presumably become
likely. Under these circumstances
a
that
6%
a
ratio
t.
4 «*■
."
■
•
v\/•:
*
■'
on
...
•
•
1
production.
■
>'
■
•
.
,
:V
/'
..
Offered only in Units each consisting of $100 principal amount of Debentures
not be separately transferable prior to August 15, 1959 or such earlier
'
nual
'
'
t
an¬
//
;/-"//
(Par Value $1 per share)
i
represents
conservative limitation
1,809,400 Slrares
Common Stock "
/;/
the
C.
I feel
August 1,. 1968
companies; further¬
more, as
;
/
and 5 shares of Common Stock, which will
date as the Company may elect. The
Company has agreed with Bly th & Goi, Inc. and Lehman Brothers that it will not make the Debentures :
and Common Stock separately transferable prior to March 15, 1959 without their consent.
N
i'
•*
Enough Natural Gas Thru 1990
.,The
resultant
indicates
Price $150 Per Unit
schedule
annual
clearly
that there will
be no problems in producing the
amount of gas required by
the
economy through
1990, although
proved
recoverable
plus accrued interest
underwriters
start to diminish in 1984 when net
production
gross
will
begin
'
to
additions to proved
r Starting
in
mentation
1991
exceed
reserves,
some
product
V.'^'VV
must be
provided by synthetic gas
from coal* oil shale,, or
some other source, if the demands
of. the/economy for natural gas
derived
are
Lehman Brothers
Blvth & Co., Inc.
supple¬
natural
of the
the Debentures from August 1, 195fr
Copies of the prospectus may be obtainedfrom any of the several underwriters only in states in which such
are
qualified to "act as dealers in securities and in which the prospectus may legally be distributed.
will
reserves
on
Scharff & Jones
Allen & Company
/
,
Incorporated
The First Boston
Eastman Dillon, Union Securities & Co.
""".J..'*'
■
to be met (and if the 6% .lim¬
'
Ilarriman Ripley &
■
,
Although such
synthetic production will initially
be very minor/ it will .increase
rapidly,/, and by the' year 2,000
mpre
than 42%V of total supply
*
.1
Merrill
...
.
1
*
•
J* White, Weld & Co, -.7 Bear, Stearns & Co.
*
...
Stone & Webster Securities Corporation
Smith, Barney & Go.
Lynch* Pierce, Fenner & Smith
Lazard Freres & Co.
Kidder, Peabody & Co.
Co.
Incorporated'
"
■
itation continues)'.
-
Glore, Forgan & Co.
Corporation
rr
'
.
Goldman, Sachs &'Co,'
Hemphill, Noyes & Co.
Equitable Securities Corporation.
,
will
gas
be: derived
production.
from
I
f
tinued research
duction
the cost' of
the
gas
..
.
?■ = •
J
.
' ■
v
to
\The
above
not be
,
on
■
Synthetic
statements
construed
research
...
•
,
Research
as
,
Incorporated
"j.
E. F. Ilutton &
..
<
Bache & Co.
Reynolds & Co.
Company
A. G. Becker & Co.
Hayden, Stone & Co.
Ilallgarten & Co.
r
Clark, Dodge & Co.
Incorporated
''
Francis I. duPont & Co.
Dominick & Dominick
will be
fully com¬
petitive with the natural product.
Need
.
t-
Paine, Webber, Jackson & Curtis
F. S. Moseley & Co.
1
Z-fA, C. Allyn and Company
Wertheim & Co.
V •"
•,.
synthetic
Lee Higginson Corporation
Ladenburg, Thalmann & Co.
* W. E. Hutton & Co.
Carl M. Loeh, Rhoades & Co.
synthetic pro¬
on
process,'
IJornblower & Weeks
synthetic
personally
confident that by then, given con¬
am
Shields & Company
L. F. Rothschild & Co.
Gas
F. S. Smithers & Co.
should
meaning that
synthetic natural gas
i
Tucker, Anthony & R. L. Day
Spencer Trask & Co.
G. H. Walker & Co.
August 20, 1958.
should
be
postponed for some
because it may not be need¬
ed until 1991.
The hesitation of
This advertisement appears
years
the
financial community -to
ognize estimates of ultimate
ural
gas
in
reserves
because
upon
necessitates
the
Houston Texas Gas and Oil
im¬
of
First
means
:
on
such
processes
the day when
$39,200,000
Coastal Transmission
First
r
This financing
of synthetic natural
gas will
effectively place a ceiling on the
natural product at
the
I feel that the postulated sched¬
ule of annual gross additions and
realistic, because
of;my assumption that
tions
will
start
to
gross addi¬
decline
when
has been arranged privately through the undersigned.
T
Blvth & Co., Inc.
wellhead.
net production is
Corporation
Mortgage Pipeline Bonds, 5V2% Series due 1979
may
the reduced
cost
cost of the
,
of '
producing synthetic natural gas as
soon as possible.
Furthermore, it
seems
feasible that vigorous re¬
hasten
Corporation
Mortgage Pipeline Bonds, 5'A% Series due 1979
presumed
wasting asset,
development of
a
effective and economical
search
of record.*
$68,200,000
fi¬
nancing terms upon gas company
dependence
as a matter
investment
decisions, and the resultant
position of unduly rigorous
securities
only
rec¬
nat¬
Allen & Company
1
i
'
>
Lehman Brothers
Scharff & Jones
Incorporated
August 20, 1958.
.
the
recent
offering of these securities for sale, or an offer to buy, or a solicitation of
The offering is made only by the prospectus.
an
ural gas can never
with
tive value in deriving the schedule
its
,
years
relative
fuel
attempted .to
participate. Nevertheless
many factors which can
offer a qualitative approach to¬
ward this problem.
gas
promise,: but
any
not
refuse to
there
given
have
I
for the
in
feasible
a
discussing
develop specific price predictions
that
These possibili-.
definite
offer
have not been
/In
prices,
symmetrical
prior to. that
net production of nat¬
(c)
extent from
some
relative
alternative schedules
natural
gas, and the
in which this maximum will
year
-anyone
of
type of
will de¬
reserves
same
which
increase
additions
gross
Obviously
duction
tions .necessary,
7
.
on
field
page
24
8
The Commercial and Financial Chronicle
(708)
American & Foreign Power
& Co., 25 Broad
send interested parties the
to
will be pleased
following literature:
Barnes
120
tional
Blocks,
J
1958—Discussion of plastics industry—Na¬
& Research Corporation,
120 Broadway,
Air
investment letter
Chemical & Pharmaceutical
an
—
Burnham and
Also avail¬
"v
Indices—Circular—Smith, Barney
Outlook for Japan
—
Analysis in current issue of
Co., Ltd.,
111
Loeb, Rhoades &
120
York
Lone
—
&
Northern Trust Company,
50 South
—
Discussion
with
particular
reference
Chemical, American Bosch Arma and Packard Bell—Bache
&
;
&
Over-the-Counter Index—Folder showing an up-to-date com¬
parison between the listed industrial stocks used in the Dow-
cisco -6, Calif, -v.'...f
*
■t
Call!
Options
—
Schmidt. & Co.,? 128
"
Booklet
how to
on
-;
use
•
...
them
—
Green, Ellis
Mr.
R. W.
Oil—Analysis—Halle
N. Y.
■ ■ ■,,
.
:
Peoria.
Mr. Keith
will work on special analyses, cor¬
porate
financing,
acquisitions,
mergers and divestments.
\
;
Chicago
j
v
events
'
,
&
Co.,
j /;:
.
In
,
Aug. 21-22,1958 (Denver, Colo.)
—
Bulletin
..
America—Analysis—Reynolds & Co.,
Broadway, New York 5, N. Y. Also available is a list of
analysis of Neptune Meter
Co., and
a
memorandum
on
Radio Corporation of America.
Current trading favorites
are
Co.—Data—Herbert
Street, New York 5, N. Y.
data
on
E.
Stern
Also in the
74
Security Dealers Association
Trinity Place, New York 6, N. Y.
Company Building, has been
changed to S. D. Lunt & Co., fol¬
lowing the death of Thomas W.
Mitchell.
ships
The firm
has member¬
the New York Stock Ex¬
change and the American Stock
Exchange.
Branches are niaintained in New York City, Norwich
Teletype NY 1-376-377-378
Maketewah Country Club.
on
Reynolds & Co. Sept. 26, 1958 (Rockford, ill.)
Rockford Securities'Dealers As¬
sociation
SAN
FRANCISCO, Calif. —
David C. Elder, Miriam M. Moore,
Edwin I. Sampson and George H.
annual "Fling
Reynolds & Co., 425 Montgomery
Street.
Mr. Elder was formerly
with
F.
E.
Mr. Roe
Hutton
was
&
Company;
Lynch,
AVAILABLE
with Merrill
Pierce, Fenner & Smith.
Experienced
Syndicate
Institutional Man.
Years with Wa 11-S4
White, Weld
member
FRANCISCO, Calif.
Rudolf J. Domenie
ated with
is
now
SAN
Sansome
affili¬
Street, members of
Stock Exchanges.
Pacific
—
to
...
20
r ee
t
well-
institutional
buyers in U. S.
—
Irving Lundborg & Co.,
the New York and
FRANCISCO, Calif.
firms
known
(Special to The Financial Chronicle)
(Special to The Financial Chronicle)
SAN
Ding"
try Club.
and
Irving Lundborg Adds
-
at the Mauh-Nah-Tee-See Coun¬
Roe have become associated with
and Rochester.
310
HAnover 2-2400
U:
Sept. 26, 1958 (Cleveland, Ohio)
Bond
Club of Cleveland fall
Co., 52
circular
(Special to The Financial Chronicle)
Now With
Members New York
&
same
Uni¬
outing at the Cleveland Country
Four With
Y. —The firm
of Lunt & Mitchell, Marine
N.
Trust
Troster, Singer & Co.
*
Twentieth Century-Fox.
Now S. D. Lunt & Co.
name
Sold
V.
dub.
BUFFALO,
—
Co., Union
Building, Cleveland 14, Ohio.
&
;
Municipal Bond Dealers Group
annual outing
cocktail and
dinner party Thursday at Queen
City Club; field day: Friday at
Corp.—Memorandum—Bosworth, Sullivan &
Woolworth
W.
,
(Cincinnati,
Sept. 18-19, 1958
Ohio)
\
Productions—Analysis—T. L. Watson & Co., 25
Broad Street, New York 4, N. Y.
Commerce
Club.,
bj' dinner Sept. 11 at the
versity Club.
Walt Disney
Wall
Bought
Denver-Rocky
24th an¬
nt/the Co¬
Municipal Bond Club of Chi¬
cago annual field day at Elmhurst Country^ Club; preceded
Laird, Bissell &
—
Wolf & Dessauer Co.—Memorandum—Fulton Reid &
Gustin-Bacon Mfg.
of
Sept. 12, 1958 (Chicago, 111.)
Convertible Preferred Stocks, an
m'
Arden Farms Co.
Club
lumbine Country
Vanadium Corporation of
F.
|
investment Field"
Mountain Group IBA
Street, New York 5, N. Y. ;
Meeds, 120 Broadway, New York 5, N. Y.
For financial institutions
G. D. Searle
and
COM ING
Co., 660 Seventeenth Street, Denver 2, Colo.
Ling Electronics
He maintained offices, in
Stieglitz, 52 Wall Street,
&
,.
Western Nuclear
Lithium Corporation
financial
institutions,
production in-
railroads,
dustries.
,
.
Corp.—Memorandum—Sutro Bros.
Title Guarantee & Trust- Co.
,
his appoint¬
consulting firm to
Broadway, New York 5, N. Y.
Broad
Corporation—Report—Thomson & McKinnon, 11 Wall Street, New York 5, N. Y. Also available is
report on Western Union Telegraph Co. and on ABC Vend¬
:
Keith prior to
and consumer and
Also
Missouri Public Service Co.
Spencer Chemical Co.—Analysis—Newburger, Loeb & Co., 15
a
; -.v
—
special
a
lesby.
ment headed a
Memorandum
was
nual summer frolic
120
:
Holtman
Frank
Co.—Study—Troster, Singer & Co., 74
—
Coast
Richard F. De Graca is
White,
Weld
Street.
He
&
was
Co.,
now
Ill
formerly
with
Sutter
with
Irving Lundborg & Co. and Blyth
& Co., Inc.
>
agent of the Federal Bureau of
Investigation prior to joining Byl¬
Bond
•
*
Memorandum
"
American Bosch Arma
was
to head.
Otis Elevator Co. and H. L Thompson Fiber Glass Co.
Broadway, New York 5, N. Y.
analysis of 82 corporations fof Western Pennsylvania—Singer, Deane & Scribner, Union Trust Building, Pittsburgh 19, Pa.
;
appointment
ager of the Washington office of
Byllesby which he v/ill continue
Oklahoma Mississippi River
Company—Report—The Milwaukee
on
His
preparatory to expansion of
Department.
Company—Analysis—Shearson, Hammill & Co., 14
Wall Street, New York 5, N. Y. Also available are reports on
Co., Dept.; X, Box 899, Salt Lake City 10, Utah.
ing.
—
-
Dudley Haltman has been Man¬
Ruber old
—Filer,
Western Pennsylvania Corporations—1958
.
The First Cleveland
Company—Memorandum—Doyle, O'Connor
New York 5,
Light
^
on
Quotation Committee of the
Dealers.
made
Accident Insurance Company—Analysis—
Co., Inc., 1 Wall Street, New York 5, N. Y.
Chemical
Plymouth
■
Treasure Chest in the Growing West—Booklet describing in¬
dustrial! opportunities of area service—Utah Power &
;
—
Minnesota Mining & Manufacturing Co.
120
:
National Association of Securities
Corporation—Report—Ira Haupt & Co., Ill Broad¬
New York 6, N. Y. Also available is a review of
Pcnnsalt
a-g€r.of the
Company—Analysis—Schweickhardt & Co., 29
Paper
;
present Chairman of the '
Quotation Com¬
mittee and a member of the Na¬
Pennroad
Positive Investment Policy—Study of leading western compa¬
nies—Dean Witter & Co., 45 Montgomery Street, San Fran¬
&
memoranda
Broadway, New York 6, N. Y.
way,
Darfler../,
Mid west,Regional
tional
Co., 135 South La Salle Street, Chicago 3, 111.
Oxford
used in the National Quotation Bureau Averages, both as to
yield and market performance over a 19-year period —
National Quotation Bureau, Inc., 46 Front Street, New York
4, N. Y.
Put
,
and
Natural Resources
Company, 61 Broadway, New York 6, N. Y.
Jones Averages and the 35 over-the-counter industrial stocks
;
Memorandum
memorandum
A. M. Kidder &
Oil Industry and Middle East Problems—Survey—E. F. Hut ton
&
Life
National
Co., 36 Wall Street, New York 5, N. Y.
a
-.
Darfler
Byllesby Trading Department. He '
former President of the Se¬
curities Traders Club of Chicago, -
Anderson, 61 Broadway, New York 6, N. Y.
available is
A.
Mr.
the Trading
Pressprich & Co., 48 Wall Street, New York 5, N. Y.
to
Douglas Aircraft, Lockheed Aircraft, American Potash and
"
Aetna Securities Corporation,
—
Minneapolis & St* Louis Railway Co.
,
—
;
,
was a
Trinity Place, New York 6, N. Y.
Company!of New York, Inc., Ill Broadway, New York 7,
Makers
—
Mine Safety Appliances
Yamaichi Securities
;
Sch m i ck
has been Man-
;
Glen
Company, 207 East Michigan Street, Milwaukee 2, Wis.
Current information
New York.
.
Report
Madison Gas and Electric
Street, Chicago 90, 111.
;
i,)
Product Lines and Mississippi Valley Gas Co.
Discussion in August
;
and is at
—
Louisville & Nashville Railroad
—
;
was
it
President.
Corporation—Analysis—Laird, Bissell & Meeds,
are
-
Eastern In-',
Co. and
Broadway, New York 5, N. Y.
Also available
better
.
/
announced by
[
Corp., National City East Sixth Building, Cleveland 14, Ohio.
whose
'
.
Franklin "B.
Y.
Star Steel Co.
G.
dent,
:7
Purcell & Co., 50 Broadway,
—
•
Assistant
as
;x' V-
Analysis
.
Yiee-Presi-
Broadway, New York 6, N. Y.
Johns Manville
less.
"BusinessiComment"
Missile
—
Frank
Washington,
Hess, Moyer
Co., 123 South Broad Street, Philadelphia 9, Pa.
*r
&
Discussion in "Current Comments for In¬
Growth of the Ethical Drug Industry
—
and
Company—Analysis—G. A. Saxton & Co., Inc., 52
City Steel
Vice-
as
Holtma n,
International Salt Co.—Memorandum—Woodcock,
is a tabulation of 21 companies whose profits were
than expected for the first six months of 1958 and 21
Japanese Stocks
*
Chica-
.
,
Presi dents
Street, New York 5, N. Y.
Hydra Power Corp.
5, N. Y. In the same issue is an analysis of Kohr Aircraft
Corp. and a list of selected stocks in the 20's. Also available
La Salle
<
Co.—Memorandum:—Bear, Stearns & J
—
New York 4, N.
/
•
vestors"—Francis I. du Pont & Co., 1 Wall Street, New
were
Keith,
Com-
7^77^'*',/I?"-"
Gamble Robinson
Pacific
on
dustries.
Granite
Co., 42 Wall Street, New York 5, N. Y.
profits
&
Co., 1 Wall Street, New York 5, N. Y.
Wall
Electric Utility Companies—Review—Carl M.
—
Interstate Gas
L.
go,
Homsey
Company—Analysis—Loewi & Co. Incorporated,
East Mason Street, Milwaukee 2, Wis. Also available is
Gas Service
Broadway, New York 6, N. Y. Also in the same issue is
analysis of Japanese Food Industries and Chemical Fillers
Estate Planning
Pont,
David
and
Beit
bulletins
Co., 20 Broad Street, New York 5, N. Y.
and Non Ferrous Metals.
-
-
analysis of Gas Service Company.
an
Holtman,
F.
Washington,
Incorporated — Bulletin — De Witt Conklin Organiza¬
tion, 120 Broadway, New York 5, N. Y. Also available are
Nomura's "Investors Beacon"—Nomura Securities
61
;
Dudley
Chicago,
Lapham & Co., 40
Diebold
Company,. 15 Broad Street, New York 5, N. Y.
able is current Foreign Letter.
Economic
—
Lines
Corporation—Analysis—Du
Colorado
-:
5, N. Y.
Burnham, View —Monthly
&
225
V;
Securities
New York
Memorandum
;
Inc.—Analysis—William R. Staats & Co.,
Sutter Street, San Francisco 4, Calif.
Chain
Hanseatic Corporation,
New York
—
—
135 South La Salle
Street, has named Glen A. Darfler,
and Company,
^
C.
Broadway, New York 5, N. Y.
Building
;
Analysis
CHICAGO, 111.—H. M. Byllesby
Development Inc.—Analysis—National
Oil
&
pany,
cular
1953; discussion of acceleration of atomic power con¬
struction in Europe — Atomic Development Securities Co.
—
Also available is a memorandum
31 Milk Street, Boston 9, Mass. Also in the same cir¬
are analyses of Container Corporation, Hoffman Elec¬
tronics and International Minerals & Chemical.
^
1
since
Market
Byllesby
Appoints Officials :
H. Hentz & Co., 72 Wall
Exchange Place, New York 5, N. Y.
Atomic Letter No. 40—Including number of radioistope users
Bond
Gas
Engineering Co.
Bonanza
*
Ill
Inc., 1033 30th Street, N. W., Washington 7, D.
—
Securities Corporation, Skinner Building, Seattle 1, Wash.
Celanese
%
Memorandum
Penn Dixie Cement.
Anchorage
It is understood that the firms mentioned
•
—
Street, New York 5, N. Y.
on
Recommendation's & Literature
H. M.
Street, New York 4, N. Y.
American Viscose
Dealer-Broker, Investment
Co.—Memorandum—Oppenheimer
Thursday, August 21, 1958
..
.
Write
mercial
C
Box
and
723
Com¬
Financial
Chronicle, 25 Park Place,
N.Y.7, N.Y.
,
.
Number 5770
Volume 188
.
(709)
The Commercial and Financial Chronicle
..
terest paid on these bonds, or on
Trend of Interest Rates
Participation in Canada's Growth
Through Canadian Securities
R. CLARKE*
JAMES
By
,
In
faceted description
a
of the Canadian bond and stock
mar¬
ket, foreign owned Canadian investment companies, and direct
investment in Canadian companies and branches of foreign
firms, Mr. Clarke explains attractiveness of these investment
In view of Canada's ability to generate
media to Americans.
more
93% of its capital requirement, he believes it is but a matter
of time before Canadian investors will seek and obtain a por¬
others country
dence of
and submits
A
A
be
cal point of
of
this
view. It is the purpose
however
of
pension
^unc^s anc' banks. Institutions also
to
status
prep°nderant portion of
railway and corporate bonds.
bonds and net
-Post-War Placement of Canadian
ex o
'the
la in'
current
(b)
own
at
tory except
the
fact which
Canadian
into
received
less
the
than
U.
the
dollars
at
a
the
two
same
dollars
Canadian
which
dollars
S.
he
When interest rates in
borrowed.
countries
approach
a
taxes
premium the ad¬
borrowing
of
in
important.
bearing upon.
the present.
an
195204
^■
funded debt of
million. In order to show where
these bonds were placed, Table II
has been prepared.
Canadian gov-
The table clearly shows that in
The
total
of
amount
James r. Clarke
and'
ernments
^rst fjve years
corporations
there
31, 1956 was $26,164 milThe total per capita
funded debt of all Canadian gov-
period
0f
Canadian
Dec.
on
lion (Table J).'
ernments and
31,
1956,
corporations on Dec.
1.604, as compared
was
of
bonds both
in the
u. S. A. and in London and heavy
net
issues
new
Canada.
In
within
placed
last
the
seven
with $4,034 per
the net
lie
years,
25%
approximately
however,
capita for all pubcorporation debts in the
retirements
net
were
of
;
are
There
States.
United
the
certain differences
are
which will be
held
tax
is
withheld
and
are
are
United
general
are
No
basis of the figures which, support
ratios do not include : in¬
these
.
vestment in
bonds
the
first
by
non-resident
a
no
total long term and short
foreign capital, bonds and
equity invested in Canada at the
are
at
Some
bonds
tax is
withheld if payable in U. S. dol¬
15% tax is withheld if
a
to
taxes
lion
U.
Bonds
Free
withheld at the source against in¬
1956
In
has
75%
or
S.
Of
A.
investment,
were
been
estimated
is
billion
$7.4
direct
in
owned
or
60%
in
investments
con¬
trolled Canadian subsidiaries and
businesses.
U. S. A.
_
total
.
..
eliminated
are
A. holdings,
S.
investments
1956
in
-
^
Ot
j.
debt
of
v
j.
x-
j-
i-.
total
the
Debt
Funded
j
j
funded
Canadian
$26,164 million. $22,035
million, or 84.2%, was held in
Canada; $3,294r million, or 12.6%,
in the U. S. A., and $835 million,
or
3.2%
and
United Kingdom
in the
countries.
other
In
new
contrast
less
ipal
bonds
States
municipal
and
are
United
71%.
bonds
the
in
Importance of U. S. Direct
Investment
not tax free.
Although figures
Direct
B.
Investments
records
each
of
standing,
able to
in Canada
the
Unlike
definite
year
Canadian
there
eign
show the total
are
bonds
no
not avail¬
long
term
investment
Canada at the end of 1957
an
out¬
statistics
are
give the details of the for¬
to
analysis for 1955
the
show
or
on
than 35%
abroad
honds
*from
a
talk
by
Summer,
1958
Capital
City.
class
Mr.
Clarke
the
to
"Economics
in
held
Formation
vast
New
in
of
in
U.
dollars.
S.
bonds
more
in
rower
Public Service Electric and Gas
the
Company
attractive to the borthis
than
country
;
in
York
TABLE I
Sub-total
governments
_
Railway
Other Corporations—
$19,489,000,000
.
Total:
August 1, 1988
5
Price 102.046% and accrued interest
100%
of
Canadian
Bonds
Where Placed
Copies off the Prospectus may be obtained ffrom any off the several underwriters,
including the undersigned, only in States in which such underwriters are qualified
to act as dealers in securities and in which the Prospectus may legally be distributed.
\
Canada
U.S.a.
Other
$909
,
Due
1, 1958
II
Retirement
/
1951-57
Dated August
75%
20
Total
1946-50
Refunding Mortgage Bonds,
10
(Millions)
period-
As at end
16
1,371.000,000
TABLE
or
'
49%
$26,164,000,000
New Issues
i
.
4/15% Series due 1988
Per Cent
5,304,000,000
Total
.
,'4
2,498,000,000
—
'
.
First and
Amount
Stearn
Net
in
sold
are
are
When
U. S. A. it is because interest rates
are
$60,000,000
majority of Canadian
Federal, direct and guaranteed._ $12,886,000,000
Provincial, direct and guaranteed
4,105,000,000
'
high
a
Canada.
Municipal
August 21,1958
per-
placed in the U. S. A.
payable
offer to sell nor a solicitation off offers to buy any off these securities.
offering is made only by the Prospectus.
NEW ISSUE
$1,563
—$474
—$180
6,605
4,968
1,645
$6,531
$7,514
$1,171'
—
8
—$188
The First Boston
Corporation
TABLE III
Interest Rates
,
of December:
1953
canada
2.92%
u.s.a.
2.45%
,
.47
3.48
-
-
2.70
.78
3.60
2.77
3.63
2.78
.85
2.95
2.57
Merrill Lynch, Pierce, Fenner & Smith
.38
3.39
2.89
.50
3.98
3.44
.54
1957
3.66
3.07
.59
3.55
3.10
.45
July 17, 1958
Carl M. Loeb, Rhoades & Co.
.83
1956
Eastman Dillon, Union Securities & Co.
Dick & Merle-Smith
spread
0
R. W.
Pressprich & Co.
F. S. Moseley & Co.
Salomon Bros. & Hutzler
Dean Witter 8c Co.
of
page
issues placed
again is running at
Canadian
3%rnYo7k ptanctr cJSSK
The
.
outside of
held abroad in 1936.
new
an
The
A.)
S.
rate
funded, debt held
was
of the total.
centage of net
total
about 34%
U.
in
1956,-
be used
may
importance
Continued
available at this time which may
This advertisement is neither
TT
amounted to $574 million or more
<phe
*956,
f
(almost entirely in
approximately 15.3% of the
in
'
..
.
issues,
'
abroad
\
placed
retirements,
with
Canada
corporate
and
.
were
Canada:—Unlike state and munic¬
In 1957 the
Canadian
provincial,
municipal,
r
of
Ownership
Canadian issues were
and
government
total U.
the
direct
If
bonds
placed in the U. S. A.
and
new
the
the« total American
branches of U. S. corporations and
from
Tax
No
the which
are
of
$16.7 billion of which. $12.4 bil¬
municipal
payable in Canadian dollars.
(e)
exclu¬
The
end
corporation
almost
term
mortgage and others de¬
On
owned
are
sively by Canadians.
corporation
to
farms, real estate and
unincorporated businesses
other
which
Canada
similar
States.
if
similar
very
obligations of the Government of amount
the
r
bonds in the United States.
obligations of the Government of
Canada
..
manufacturing,
32% of total ownership. This
compared with 38% in 1939. The
Corporation Bonds:—These
(d)
in Canada
Bonds:—These bonds
.
current
to
payable in Canada only.
provincial
of
pro¬
in
a
graphs.
Government
'
applies to
ownership in
mining
(including smelting and petro¬
leum
exploration and develop¬
ment) steam railways, utilities and
merchandising amounted in 1954
non-resident no tax is
withheld by Canada if bonds are
payable in U. S. dollars but a 15%
by
brought out in the following para¬
(a)
Statis¬
Non-resident
payable in Canadian
\
it
that
Canadian
Municipal Bonds:—Munici¬
are very similar to mu¬
nicipal bonds in the U. S. A. When
similar to comparable bonds
very
economy.
has
conditions.
(c)
lars, but
Canadian bonds of all kinds
lieved
U. S.
tax is withheld
5%
a
however,
estimate is for 1954 but it is be¬
pal bonds
bentures.
Some Characteristics of Canadian
in
but
payable
funds only.
the
United States disappear.
withheld from
are
bonds
from interest
are
vantages
the
of
Dominion Bureau- of
The
The
small extent real estate taxes.
a
the
level but the Canadian dol¬
lar remains at
to
No
dollars
enabled
Bonds
In tne ten years ended Dec. 31,
1955, the total net new issues of
all classes of Canadian bonds, that
is Federal, provincial, municipal,
and corporate, amounted to $4,693
has
past
Bonds
.
as
—
precise-guide to the
the - in¬
a
sector
made certain
bonds of each of the
estimates of the importance of
are
also
general obligations of
the province which issues them. foreign ownership of selected
Canadian
industries
relative to
Principal
source
of
provincial
total ownership. The most recent
revenue are: gasoline taxes, motor
dis¬
substantial
a
as
equity invested in
dustrial
provinces tics,
held
their past his-
the Govern¬
Provincial Bonds:
vincial
meant that the Canadian borrower
portion
companies,
insurance
paper
total
Canadian
the
profitable premium.
Since
February, 1952, the Canadian dol¬
lar has been at a premium which
and municipal government bonds
heldintheU.S. A. are owned by
institutional investors inclosing
very
a
a
lars
the Canadian Federal, provincial
Canadian
bonds
comprehensive
subject if treated from an histoidof
study
could
substantial
very
time
but
1951
very'
selected list of Canadian stock.
a
Bonds
A. Canadian
was;
and
1950
same
count,
increasing interest in Canada; dwells on tax advan¬
tage topic;
became
borrower to convert his U. S. dol¬
evi¬
as
the
in
dollar
concerns
U. S. A. and Canadian firms in each
Canada
at
in Canada. Refers to Toronto Stock
Exchange volume and opening up of brokerage branches by
wholly owned
Canada
favorable in the U. S. A. than
in
ownership and profits of foreign corporations with
tion of the
in
rates
be used
bonds guaranteed by
ment of Canada.
close to those in the United
States. After July, 1955, the spread vehicle licenses and fees, the Fed¬
again widened and has remained eral subsidies in lieu of income
that way up to the present. Table and
corporation taxes,
taxes
III uses Canada 2 % of June 15, against natural resources includ¬
1967-63 and United States
of ing stumpage fees
and oil and
Dec. 15, 1967-72.
mineral royalties, profits of rev¬
enterprises, and
Not
only were interest rates enue-producing
very
New York City
-
ended Dec.
31, 1953, interest rates in Canada
were
materially higher than in
the U. S. A. During the first seven
months
of
1955,
however,
the
spread began to narrow until in¬
terest
Vice-President, The Dominion Securities Corporation
-
the four years
For
9
Wertheim & Co.»
Wood, Struthers & Co. !
the
30
The Commercial and Financial Chronicle
10
Views
Senator Smatheis'
New
on
various forms of transportation.
The
out
Transportation Policy Study
measure
was
or
President, Alco Products,
SMATHERS
of that unfortunate
Principally because of
this
locomotive
its
finds
mid-year
All
period.
in our issue
picture of the
repeated here
quarter of 1959.
good backlog of orders for export,
excellent condition at
indications are that the company's
a
tions
the
from
contains, among other things, specific legis¬
recommendations by the Commission.
lative
Ths. Subcommittee will study and work
whatever ICC suggestions we feel are in
on
public interest, looking toward eventual
legislative
enactment of those
suggestions
approved by the Committee.
During the 85th Congress we enacted
the
mm
important measures which should prove
to the transportation industry.
We
watch the operation of these measures
and
with
great
such
amendments
>y,
i
having in mind making
interest,
additions
and
Sen.
appear
as
wM,
m,
WS/M
Smathers
Geo.
necessary.
In
whether
months I
several
next
the
will
also
not representatives of all the
or
interested
be
to
see
a
year-round, ^nd nojt five .months'-,
revenue should have a layout, for,
of boats and engines.
We
are
sure
profitability of marinas is
increasingly V attracting
persons
The
Vr."w
with
of the nation, and are
their requirements.
them, and some
institutional lending on land and
structures has been arranged, al¬
tle
big
oil
companies, particularly
Gulf, Texaco, Socony and Esso,
have been aggressive in develop¬
important
standing by to meet
:-'t
ing marina gallonage and can of¬
some help in financing the fuel
fer
This
cover
<S. Res. 303)
Critical answers to specific proposals for
required to settle the constant agitation for
change and the resulting confusion in the public mind concerning
extent.
regulation
are
the need and propriety of Government regulation of transportation
under prevailing
conditions:
The area of Federal policy dealing with Government
provided the various forms of transportation and the
desirability of a system of users' charges to be assessed against
those using such facilities;
(2)
,
assistance
either
one
form of transportation
Such ownership, except in unusual
forbidden
made
or
extremely
cases,
difficult
is generally
under
existing
much
Seaboard Air Line
on
the subject of large-
scale consolidations and mergers in the railroad industry:
Air Line continues to
Seaboard
have
ties
long-term
growth possibiliof the
of the nature
because
Of
course,
outbound
traffic
has
been increased by larger phosphate. rock and lumber shipments.
Seaboard is faced with a high
lation, increased building activity degree oi competition.from trucks.
and location oi new manufacture To meet this, Seaboard has remg companies has continued
to duced rates on citrus fruit volume
add to traffic potential. -*'■
A
as well as'for canned goods and
Traffic in June was 2.3% above frozen citrus concentrates. It also
the comparable 1957 i:period; and is hoped that the removal of exindications * are
that
the worst-cise taxes on freight shipments
The
have been will bring back additional traffic
declines
year-to-year
road
has
been' as? to the road.
not
It will be interesting
adversely affected by the business to note if the new legislation rerecession as a- number of other,-Jcently enacted and --signed into
carriers in different territory since
law to tighten agricultural exemp-
tions will further • improve ; its
weather' competitive position.
;
"
conditions last winter kept traffic j? The financial condition of the
down in the first quarter.; of the-road remains satisfactory despite
highly dependent upon
heavy industry. However,
.
the
of
of motor
i
(5) Policy considerations for the kind and amount of railroad
sleek
mod-
bv
to
necessary
the public and provide for
serve
hosp'itabie marinas as snug
£ mooring at the-end of
d
h
day,
a
or
voyage.
Goughtry V.-P. of :
Lehman Corporation
-
,
Carloadings
in
\r\no
Addressing Service
.
houses which will mean
A»
publishers oi "Security Dealers of North Amer¬
ica,"
we
bank
listed
a
have
position
than
you
There
to
are
States
a
metal
this
stencil
for
publication,
offer you
can
States and
by
in
obtain
a
every
firm
and
which
put» us In
up-to-the-minute list
more
approximately 9,000 names In the United
in Canada, all arranged alphabetically
900
and
Cities.
v
Addressing charge $7.00 per thousand.
Special N A. 8 D list (main offices only) arranged
Just as they appeared in "Security Dealers."
Cost
lor
addressing N
We can
at
a
small
also
A
S. D
List. $8 00 per thousand.
supply the list
charge
on
gummed roll labels
additional
25
Park Place
—
'Secnrtty Dealers of North America"
REctor
2-9570
—
With
New
the
expansion
service district, revenues
York
City
revenue
llam st-> New Yo
y
of
faifly fast, pace-in flowing through to net income.
recent
yeatfs, with noted
gains ;The transportation ratio has consince
1950.
The gain in freight stantly been increasing in recent
revenues
has been made in the years.-This has taken place in the
face of declining passenger busi- face
of
complete ' dieselization,
riess and with some :drop in 1952
new yards and other modernizaas a result of a change in the divi-' tion of the property:41
"
sion
of through rates with* the'
%
at
nf
Wil-
1
,
announced by
Robert«L e h-
-man,V< President; an d
Monroe
C.
G
u
t
m
a
the
n,
of
Chairman
Executive
Committee, of
the invest¬
ment
com¬
pany.
C
Mr.
oughtry,
heretofore As¬
sistant
Lloyd S. Coughtry
executive
staff
Vice-
President,, has
been a senior
.
of
analyst on the
The Lehman
gains-have been
;the 'larger,than for most roads, rising
have-in- costs have kept .the increase from
i
eiatwl with.dhe company
alters tqe^lpse a
,
a
.
Northeastern States.'
Herbert D. Seibert & Co., Inc.
Publishers of
/-While
traffic in the future.
creased
elsewhere
additional- about $1,500,000.
"Pr»sid»nt
Corp
£he
,
Dealer-Broker
Lloyd i S.
of
election
The
vongnti3^|S rnmnr'ntinn
' v, ;;
weeks
have begun to show improvement,
This is particularly true of shipments
of
paper
products and
phosphate rock.
The flatter; has
contributed substantially' to the
year.
motors
Dowered
; r
recent
large expenditures for new equipment. As of May, 31, cash items
amounted to $17,852,000 and curthe national defense;
rent liabilities were $21,720,000.
(6) The problems arising from action by the Interstate Com¬
Net working capital was $20,522,merce Commission in permitting the charge of more for a short
)
000 down from $28,452,000 a year
than a long transportation haul over the same line in the same
earlier.
Capital expenditures
growth in revenues of the Sea- through May were larger than in
direction; and
board.
Housing starts also have the comparable 1957 period. It is
(7) Additional matters of Federal regulation (and exemption
turned upward and it is expected expected that these outlays will
lumber
and
building
materials >be. curtailed in" coming -months
traffic will expand.
In addition, which should ease the drain on
other industries are growing. Two cash;resources.
Depreciation
cement plants are expected to be ^charges this year will exceed macompleted shortly and other plants , turing equipment obligations and
are
expanding as well as ware-, sinking
fund requirements by
service
un-
'made
■
passenger
travel mode
uncrowded
high
craft
taken put
relaxing—and
nleawmt
fh
a
highways,
a new
cafm
'
boating.
and
power
.
romance
trips,
f
h.irHprl
territory served. Expanding popu- :
it is not as
statutes;
(4) Examination of Federal policy
the magnitude and the
pleasure
With : congested
seen.
(3) The subject of the ownership of
by another.
of
lure
(1) The need for regulation of transportation under presentday conditions and, if there is need for regulation, the type and
character of that regulation. The hearings on the railroad situation
show one thing above all else: the existence of substantial doubt
concerning the efficacy of present Transportation regulation. To
ascertain the public interest in regulation, the burden should be
placed on the public and the carriers to show why it is needed
to
piece couldn't begin to
the subject.
It does- serve
to outline
The authorization included the following:
less
V'?
station.
During the last session of this Congress we provided for a
"study of the transportation policies in the United States."
what
as yet there has been lit¬
public financing. Some of the
though
sound national transportation system.
and
been
Groups have
"capital:
formed to finance
.
that the railroads will continue as an
factor in the lifeblood
j
^
'"
vv. a. iv«jrr»6
completed the most modern locomotive-manu¬
$4,000,000, at our
_
,
hauling, /painting, winter storatge
(preferably- covered) and engine
overhaul; and perhaps for the s&le
facturing plant in the world, costing more than
Schenectady plant.
various transportation
media—railroads, water carriers, the airlines, pipelines and motor
carriers—have any specific legislative suggestions or recommenda¬
tions which would be in the public interest and in the interest
of
Finally,:jpoatinas, with, an eye to
.
In 1955, we introduced a completely new diesel
engine to the industry, and we followed up a . year later with an
all-new line of locomotives: v^isf aotiori^was climaxed last spnirig
when the company
-
aboard. Hence, marinas
offering bar, restaurant and hotel
service are eagerly sought out.
times ,over
many
fre-
mariners
quarters
in recent years.
valuable
will
this
of weekend
quently get fed up with the grub
detail and with cramped sleeping
.
have demonstrated
and
wives
■
many
store
a
facilities
Further
boats,
the railroads will need
existing power and expand their
pools of locomotives with both new and rebuilt
units. At that time, they will find a locomotive
industry completely ready to fill their needs.This is because the principal manufacturers L,j
have
managed
to maintain full: operations
through the recession- by their success in com¬
peting with builders in all parts of the world
for fleet-locomotive orders.
i*V
"
We at ALCO have faith in * the. railroads,
replace
boatside,
at
stations,
repair, washing down
garbage disposal. The
engine
or
basically sound opera¬
tion of volume traffic,
to
water
fuel
It
power
should include personnel for' hull
•
but accrue to the benefit of
when
they rebound
current recession.
With a resump¬
the Subcommittee will receive
later this year the annual report of the Inter¬
state
Commerce
Commission.
This report
First of all,
electric
sale of ship supplies, gro¬
and. ice.
ceries
railroads
continuing interest to us.
running
for the
maintained for 'the
for. transients.
shore
have
convenient
operations in
can't help
domestic
the
or
space
should
.
We feel that these
cove
surplus
error.—EDITOR.]
present satisfactory level of shipments will be
remainder of this year and into the first
Florida
impossible now to anticipate the specific legislative
fields in which the Surface Transportation Subcommittee will
be most active in the future, but I do appreciate the opportunity
to
mention the lollowing broad, general areas which are of
is
bay,
a
tributary stream. "
It should have slips or moorings
for the home fleet and adequate
and
'
■'
U. S. Senator from
Garages
berth, preferably located in
[The statement of Mr. Morris as published
ALCO
It
And Marina
inlet,
because
i
On Pleasure Boats
Incorporated
of August 14 inadvertently contained the
wrong "William S. Morris" and is being
4
page
Investment Notes
:>
-
from
By W. S. MORRIS
industry.—EDITOR.
By HON. GEORGE
Continued
national transportation system and is it in the
it gOGd-fOf a sound
^iclev of August 14 which contained commentaries
from ICC Chairman Howard Freas and heads of
numerous railroads on the future prospects of the
railroad
the
•
Transportation-Subcommittee has its work cut
to weigh each possible legislative
recommendation in the light of this standard—". . . is
Florida, who was one of
the
to
will continue
We
public interest."
following cotnmentary by Senator Smathers of
the principal arrkitetfs of
recently-enacted Transg&rtgddn Act of 1958,
received too lute for publication in the "Chron-
The
regard
^^.jvy
Surface
it.
for
in
promotional .policy
Federal
and
therefrom)
/
Thursday, August 21, 1958
.
I
,
r
.
.
(710)
Although at one time Florida,.
traffic mainly was outbound; con-
'
.
lu:Jwe<st
pvrL
Mpmher
J™dwest txcn- IViemDer
CHICAGO, 111.—The Executive
Committee of the Midwest Stock
E x c h a n g e has elected Jerry
ing. This reflects increased ship- Thomas, Jerry Thomas & Co., Inc.
ments of
consumer
products as of Palm Beach, Florida, to memwell as building material supplies, bership in the Exchange.
sisting of fruits and vegetables,
an improving balance is develop-
United btates .irusx ^
New
;
TWrt
•
.'
' ■
-.-F
"
(special to the
BOSTON: Mass.
and
become
--
chro^o-e) .;
Edward Her-
Charles F. Nason have
with Hooper-
associated
Kimball. Inc., 50
Mr.
y. m
-
Hooner-Kimball
WilK
"
lihy
p
;
-
.
Heiiihy
was
Congress Street.
formerly^, with
.
Chace, Whiteside^ ^ Whislow. ana
Draper, Sears & C<x^ Mr. Naspn
was with Coffin & Burr, Inc., in
Portland, Me.
Number 5770
Volume 183
.
.
The Commercial and Financial Chronicle
.
(711)
not been that two
Promoting Peace and Progress
resolutions,
destiny
of the Lebanese people
will continue to lie in their own
one
proposed by the United States, the
other proposed by the Government
of
The
Ja^aji, failed to pass- because of
negative vote—a veto'.'
But nothing that I have said is
to be construed as
By HON. D.WIGHT D: EISENHOWER*
tions prompt and
effective action
help safeguard their independ¬
ence.
This requires that adequate
to
hands.
one
United
States
Delegation
machinery
will support measures to this end.
available to make
be
the United Nations presence
fest in the
HI
indicating that
11
mani¬
of trouble.
area
Therefore I believe, this Assem¬
bly should take action looking to¬
the creation of a standby.
>■
-President of the United. States
''
/•
The economic kew in a six-point
proposed by
our
single
plan for Mideast,
peace
Chiet Executive, in making, his second
appear¬
on
a
The other five
.
>
:
ward
United Nations Peace Eorce. The
need for such a Force in being is
clearly
demonstrated by recent
involving imminent danger
the integrity of two of our
events
to
members.
;
.
' j
-
I understand that this general
subject is to be discussed at the
ISth
General Assembly and that
distinguished Secretary-Gen¬
eral has taken an initiative in, this
tions places on all of us certain United Nations has a particular matter. Recent events
clearly dem¬
solemn, obligations.
Without re- responsibility in this matter> since onstrate that this is
a matter for
spect for each other's sovereignty it sponsored the Palestine Armis¬
urgent and positive action.
>
;
and the .exercise of
■
.' / the
J
//
is
also recognize that the end of
peace
in J or dan could have
consequences
of
a
far-reaching nature. The.
: "
or near.
'j In. the Same context, we believe
that the Charter of the United Na¬
.
steps to avoid arms race spiral ip thia area/ Opines regional
institution can be realized on a basis?: which: would attract.
international capital, both public and private,
far
any. source,
i
of action, submitted for Ik -Hi considera¬
tion, deal with Lebanon, Jordan/ subversive fomentation of
civil strife from without, a standby U. N.^peace force, and
/;
problem
1
regional basis/9
areas
urgent
.
;
The President suggests the
Arab States must provide the leaderships and govern this re¬
gional institution themselves and,, as a condition for U. S. A.
assistance, furnish self-aid support witb their own resources; :
institution
Another
Jordan.
If we do- not act
of; life and progress. But when
promptly in
change reflects the will of the peo- Jordan a further dangerous crisis
pie, then change can and should may result, for the method of in¬
be brought about in peaceful ways; direct
aggression discernible in
In this context the United States Jordan
may lead to conflicts en-'
respects the right of every Arab dangering the peace.
'
nation of the Near East to live in I We must recognize that peace
freedom Without domination from in this area is fragile, and'We must
,v
before, the U. N. Assembly, is an "Arab development-,
ance
I regard the status quo as sacro¬
sanct, Change is indeed the law
...
.
great
by which
means
new
our
tice Agreements upon which
peace
in the area rests and since it also
care in
patterns
'
vi-
1 have proposed four ar.eas of
of international life are achieved, sponsors the care of the Palestine
.'It has been almost five years defense.
We will have let loose the projection of the peaceful vi* refugees.
action for the consideration of the
since I had the honor of address- .forces
that could
generate -dis- sion of the Charter would become
I hope this Assembly will be Assembly—in respect, to
Lebanon,
ing this Assembly. I then spoke asters.
;
,/•*
a mockery;
- v
f
able to give expression to the in¬ Jordan, subversive propaganda and
terest of the United Nations in a standby United Nations "force.
of, atomic ppw.er and urged that 7 ^&,^^(^;;:|fetiQnk.v-KhC&i
„
..
.
-
,
shouldfind
we
way by.,
which the mi¬
I
m'a
responsibility
:
4
a
['peace '
raculous in-'
ventiveness of"
primary
to maintain not only international
course,
the
but .also
+
turn
'
I?
But we must 1
1f
.dedi-;
;
?
e
.
^
tions has sometimes been blocked
death butcon-
in,its attempt to fulfill that tunc-
secrated to His
.
lron:
Since
e.
great
strides
been
b^en taken in
the
the
liberty
Elsenhower
States.
principle
This
and
of
the
ance
to Lebanon has but
one
sin-
'u
b
r p
-
of atomic
use
nuclear-power lor
weapons
United
respect
That
w
United
danger, in turn
will
gives; rise
horror of
man s
seek
war
between
,5/
by confront-
the
supine surrender, or war.
reappeared dming
recent
.
it
%
:
.
r
Taiwan. '
A.
:
since
nrevcnt
'
'
%
.
It^havSI
u
.The
-■
■
.
no
broadcasts
or, whenever, through action by
the United Nations or otherwise,
v
Lebanon is
.
no
/
,
.
It
as
these.
will,
1^ . successfully practiced
n?Ver
this
was
app^ci
principle
that
nssnm
small
countries
—
reason , is
Lebanon
and
The
-
is
cause
concern.
,
one
of
universal
"
any
-The lawful
freely
and
help. We responded to that
that
a
an
call,
the
"upside down"
portrayal.- If it* is made an inter"This-is* truly; an
To be
spirit ' of
.
assistance for Leb- ^
cojteetive:
13,1&58.
that
which
under
area,
they
across
national
fox
examining
frontiers
and
area
complaints
from
security
jeopardized
their
borders.
area
able
to
should
pressure
g, across
When such inter¬
ference. threatens
To
help the Arab countries ful¬
aspirations, here is what
they should be
propose:
.First—that consultations be. im¬
mediately undertaken by the Sec¬
retary-General with the Arab na¬
tions of the Near East ta ascertain
whether
an
,agreement
Continued
get from the United Na¬
on
;
Equipment Trust Certificates
'
$285,000 annually September 1, 1959 to 1973,
as to payment of par value and
Missouri Pacific Raftroad Company
,
'
inclusive
dividends by endorsement bf~
3.0Q5
196Z
4.153
1964-66-
4,30f5
1S69
3*50
1963
4.25
1967-69
4.3-5'
1961
4.00
197W3
4.40i
United
■
by the Interstate Commercer Commission*]
The'Offering Circular muy.be obtained in any- State in- which this announcement is circulatedfrom only 1
such of the undersigned and other dealers as may lawfully offer these securities in such State.
Issuance and-sale-of these,Certificates are subject to authornation
1
HALSEY, STUART &, CO. INC.
Nations
action
WOUld
;
forces already withdrawn^ had" it-
-
(-
.BAXTER-&. COMPANY
McMASTER HUTCHINSQH & CO.
WW; E. POLLOCK & CO., INC.
August 15,.1958
to the
fill these
I
The,countries of this
real challenge
a
Arab people and to us all.
by
external propaganda.
1
This is
.
these nations which consider their
national
economies can truly
independent
governments sustain "themselves. ;-
MATURITIES AND YIELDS
.
programs
may
wfrei, the United '
ber ta„ken' ®®United^f
York City, Aug.
opportunity to share
1959
action could take the place, of
in- United Nations
by-Pres.-Eisenhower*be-
mature
the '
States, responded to the urgent plea- '
Conquest are. unlimited* We will of Lebanon, we went: at_°hce to
have nuUfied the provision of our the Security; Council and .sought
•An 'address
of.
w
guaranteed unconditionally
the- possibilities, of
Charter which recognizes the.
an
areas
desire, to make
further progress toward the goals
of* human welfare they have set.
icy and should consider means for
monitoring the radio broadcasts Only on the basis of progressing
"
the United Nations felt- that^-its -
""Similarly:
^
* \
this
(Philadelphia Plan)
To
'
.
impression
'Thus when president' Truman;
created that, if responded in 194T to .the urgent
srhail nations are*assisted-in their plea of Greece,.the United States *
desire to? survive, that- endangers s t i P u.la t ed. that our assistance
the peace. - ' * '
"•
' would be withdrawn wheneyer ■
i
'
that
Assembly
should reaffirm its enunciated pol¬
;
rhysteria^
he
'h^rsghfot
'
have
in other
in-a great international task. That
is the task of assisting the peoples
the United States, have
fault we stand ready to
believe
I
4*A% Serial
single free gov-
is; sought:; to^
then ,ii>deed;
we
as
the United States seeks always to
the basis- of
war
a
However, here
.
that-response keep within
effort has been made .to create Charter.,
'
On
at
,
.
many
Equipment Trust,] Series K
the
doubt
in
Missouri Pacific Railroad
.
elected ernment in, ail the world .would T
government- of Lebanon, feeling willingly forego the right to ask ■
it?elf. endangered. by civil strife ^ help if its sovereignty were ,
fomented^ from- without, sent the imperiled.
n
%
United States a desperate call for
,Rut I must again emphasize that
j
been
tions.
I
expression is found in ways com¬
patible with international peace
and security.
$4,275,000
legitimate appeal of
nation, particularly small na-
answer
.
violated
clearly possess the right
determining and' expressing
of
was
two spirit of the Charter, the right to
Jordan.
been
we,
again when; the
appeals of the govern-*
f.{ The immediate
If
once
against-America, but they do ere- ments of Lebanon and Jordan
stc
dnngcrs which could, effect
unswGr6d» ^
1
i
each and every one of us. That '
be less
^ woul^
than candid
•is why I have asked for the p.rivi;
j did
not tell you; that the
lege of again addressing you.
United States reserves, within the
preserve
their own destiny. Other nations
should not interfere so long as this
that these resolutions have
It is my earnest hope that this also be freed from armed
Assembly, free of the veto, will and infiltration c o m i n
States on
That prin-
thing; to
Near East
nation
longer exposed to
the original danger.
Ban
,
one
into the homes of citizens of other
directed
> cry
o«ffrocciAn
it
to, cry fire in a crowded assein- ciple was that aggression, direct rnnsiHpr hnw it can. assure thfl'fnnconsiderJhow
the Con¬
bl^.. Should it not be considered or' indirect, must be checked be- tinued independence and integrity
serious international misconduct
lore
itr gathered suffieibrit mo- of Lebanon, so that the political
to; manufacture a general war men|um to destroy us all—aggres?carein_ gn e«ort to achieve local aod defender alike.
political aims?
.Pressures such
from
will in the troubled Near East
be, totally -withdrawn whenever
principle guided the
of the United
have
,
Aggression
position
crime
f™what
whatsoever.
ot^r-purpose what: troops
United States
the
Checking Direct and Indirectr
an Qf these occasions.
that
sti-aits th«s ^ reguested by the duly con'
•
sqtuted gpvernment of Lebanon
Korea,, the
•
.
^ common
communities it is illegal
want to
We
Greece and Turkey, the: Ber-
V
^ ,
ballistic
blackmail.
}n
;v
one
Let me state the position of
my
country unmistakably.
The peo¬
ples of the Arab nations of the
on
1950—passed Resolutions designed
stop the projecting of irrespon¬
sible
hi-theinterest of
Second.'World War-
'biockade-'
Un
Near East crisis.,
call t
have faced
we
Iran.
intelnatUll
an
^lfL'&'fWnte» ~^°r at least Prev<
to'. exploit.
end-of the
•jThis. tactic
Assembly has
to
crime, the fomenting of civil strife
be' corrected.
a foreign power.
we
i
"fof"clear
apparent choice
an
Sometimes
nf
rirxhf
mg.the nations,particularly small
nations, with
by .the
called for
Nations.
have done sb pursuant tp .what
u- the Charter cays :"the inherent
to- another danger
the- danger
that nations under aggressive
leadership
Nations
directions in the Near East.
giZionZdS
^moristration in terms of collective, measures
IP;.,
•
another, matter
three occasions^—in 1947, 1949 and
recently
endmadfS
pur-
danger.
a
is
demonstrated
s'f 0^ dlrecTot^e^
f"f
poses.
That is
.
which, ple to determine their own des¬
this Assembly should face in seek¬ tiny, consistent with the obligation
ing to promote stability in the to respect the rights of, others.
Near East.
This clearly applies to the great
That is the question
of-inflammatory propaganda. The surge of Arab nationalism,
know
s e s.
Tragically littte has been done to
Eliminate the
IV
;
There
.
p
These measures, basically, are de¬
the right of a nation and its; peo¬
has gie purpose—that is the purpose
nations, thereby "fomenting civil
of the Charter and of such historic strife and
subverting the will of
by. our unswerving adherence to resolutions of the United Nations
the people in any State."' We all
the > principles i of
the Charter, as. the "Essentials for Peace" Res-
consistently
been
,
Pm<
guiding
a
United
of
use
atomic energy
for peaceful
iv.
,
.
freedom of all nations, has always
have
Lebanon
situation was such
Ho
f
that, only prompt action would
suffice, j, .-:/
•
: .
I .repeat to you the solemn
pledge I then made: Our assist-
.
;;
Respect. for
v
then
^ military
•
in Jordan.
:
peace
signed to do
V--;'v
world since 1945,the United
his
to
preserving the
r+
a
,
be
Cdted
V-/
,,
sl)ePlflca^y t°
second' fact,;, namely;-;n, TTg int° ^eb~
[ that in..the circumstances of the.
i
A™llcan
'.not,evade,
hsiiould''
not
Iff
A-
+
^
''security." /That
ah important fact.
is
T
tl
SHEARSON, HAMWILL & CQ.
'
-
.
can
page
be
22
The Commercial and Financial Chronicle
12
tests
market
currently under
are
way
,
Has
Solid Foundation
a
is, that we are only
utilizing today in glass containers
The
fact
Executive Director,. Glass Container Manufacturers
New York City
Institute, Inc.
well
1%
glowing account of past three
straight
years
of record high
more
that
strength of
from the present 1%
for the cost factor,
possible to increase
utilization by five
all
drink
time
-
of
ments
not all) of the in¬
shipments of soft
bottles—returnable bottles
increased
high. And last
year, too,ship¬
in
ables increased
reached
tainers
new
and
81%
non-return-
14.3%. Food con¬
1.8 billion units,
contain¬
passed the
twenty-billion
about 1% over the first quarter
of
1957.
So, in summary, our
business1 continues to do well—
the
running contrary at the moment
to general business trends.
up
glass
ers
mark
for
time.
first
1957
These
shipments
%%
ac¬
for
counted
of$784,000,000.
When you add
this
an
ditional
.tudies of
ad¬
Richard L. Cheney
000,000 for the
for these
closures
glass
containers, the
business entered
container
the
for
first
time
in
1957
the
ranks of those doing over a billion
dollars
a
consumer
attitudes. We
only know what people prefer
now in packaging, but what they
liked a year ago, and we hope
we know what they will like next
not
$274,-
year.
Accounting for approximately
8% (or 10% if you include clo¬
sures) of a total packaging indus¬
try volume of more than $10,000,-
000,000, glass containers rank be¬
hind paper and fiber and steel
containers, but well ahead
of
wooden, plastic, and aluminum
packaging.
'
Let me cite an example to
indicate the importance of this.
Our research showed, as early as
1954, that there was a large un¬
satisfied
preference
for
glass
year.
intermittent use
products such as spices, ice cream
toppings, ripe olives, instant prod¬
packaging
ucts
for
and salad oils.
With the de¬
sign of the proper sizes and styles
of
glass containers, salad oil and
coffee are virtually all
instant
glass-packed, and now the pack¬
of
spices are also moving
ers
Glass Container Uses
Just where do all these billions
rapidly into glass.
And
constantly working
on our manufacturing processes to
be sure that we keep glass con¬
tainers competitive economically.
about 9%
I
for
househpld and in¬
Incidentally,
chemicals.
dustrial
we
told you
But I
can
are
that life begins at 40.
you that 99%;
also tell
of the
glass products made in the
port which accounted last year for United States today are made by
an additional half-billion contain¬
processes that were unknown at
ers—or slightly more than 2% of
(he turn of the century.
total output.
Bottles
are
whirled
off
our
none
Of
of these figures include ex¬
these
industry endfigures are really very broad
categories.
Each
one
of them
course
use
covers
number
of
large
and important industries.
Foods,
for example,
run
through such
major classifications
as
spices,
jams and jellies, salad dressings,
vegetable oil, syrups, fruits and
vegetables (including baby foods),
a
soluble i coffee
and
very
many,
many
others.
Having "super industries"
of this type as customers assures
our business, we believe, of a cer¬
tain
stability.
No
matter
how
tough things are, people must eat.
From the standpoint of
growth,
machinery at the rate of some 250
minute. Some 25 years ago
per
similar machines could only pro¬
duce 30 to 40 a minute. Changes
like this
these
industries
represent
lished
a
3.6%
new
some
above
*From
the
talk
Improvements
like
of the others I
these
Puerto
than
the
derdeveloped
of
a
is
carbon
alu¬
than
lighter
steel,
strong as'bronze,
constitutes a scientific
certainly
as
break-through in our knowledge
of the strength-secrets of glass. It
our
of
this
confidence
the
in
amazing packaging
to
last-growing small business in
the Commonwealth and to smooth
theI way
for
industrial
expanded
production there.
At
the
time, its
establishes
same
said the plan
that
be
can
sponsors
a
pattern
in
followed
You ;just don't find this
ada and Venezuela in the Western
other
"This
rapid
Coatings and other surface treat¬
ments applied to glass are receiv¬
ing intensive research attention
from companies in the glass con¬
tainer field.
They are designed
to conserve, protect and renew the
tremendous strength that lies in
the surface of glass. They facili¬
tate faster handling in the filling
lines and play an important part
in increasing the effective strength
enlarge manufacturing
ness activity.
program
at
a
has
a
partnership was announced
joint press conference held by
the Puerto Rican Economic Devel¬
opment Administration and James
Talcott, one of the
and largest com¬
Talcott,
Inc.
nation's
Glass
'
oldest
mercial
financing and factoring
organizations, has agreed to pro¬
management know-how,
vide
and technical assistance
newly formed National
the
Credit
years
solid foundation.
We
first
Corporation,
commercial
the
and
our
in
industrial
financing firm.
National Credit, organized with
capital supplied by private Puerto
an
greatest accomplishments lie
the
W. J.
Wm.
National Credit will
supply
re¬
volving working funds to manu¬
facturers, dealers and distributors
through the financing of accounts
future.
McGregor With
H. Tegtmeyer Co.
(Special to The Financial Chronicle)
CHICAGO, 111. — W i 11 i
McGregor has bemme
a m
receivable, inventory and machin¬
and equipment.
Previously,
ery
this type of financing was avail¬
able only in limited amounts from
local
J.
asso-
banks
or
branches of
Bootstrap'
chain re¬
a
rocketing sales of
of
S.
ail
kinds.
consumer
goods
For
example, since
manufacturing
has almost tripled to $125,000,000.
As a result, Puerto Rico's average
income per family has doubled to
$2,500 which, in turn, has set off
income
1948
80%;
an
and
rise
50%
a
from
in
retail
increase
spending
in
wholesale
volume."
Talcott, founded in 1854, is
one
of the few
companies in the coun¬
try engaged in all phases of indus¬
trial finance—accounts
receivable
financing, factoring, inventory fi¬
nancing, mortgage and equipment
loans, rediscounting and commer¬
cial instalment
financing. In 1957,
processed nearly
$750,000,000 in receivables.
"Operation Bootstrap" was
launched approximately ten years
ago.
This is a program designed
the
to
company
the
make
island
an
industrial
center, and features full exemp¬
tion from
all corporate
income
taxes, for a 10-year period, to
companies in new or expanding
industries approved under the
Commonwealth's
development
Other advantages of the
program have attracted more than
program.
500 manufacturers to the island in
National
Credit's
original
recent years and its gross national
product—the total amount of goods
by Messrs. Martinez and Morales and services produced—has almost
contributed $400,000 with the doubled in the past ten years.
capital of $650,000,
■feW
U.
banks.
Of
'Operation
has triggered
consisting of growing pur¬
chasing power, and resultant sky¬
island's
Rican investors, will be headed by
important segment of
Luis Martinez and Julio O. Mo¬
dynamic packaging industry.
rales. The Puerto Rican Govern¬
But we are not resting on any
ment, through EDA's financial
past reputation. We are working
arm, the Puerto
Rico Industrial
constantly to extend the assets
and limit the liabilities of glass Development Co. (PRIDCO), will
also supply funds.
containers. We are convinced that
occupy
industrialization
the
action
The
to
in
experience
as
an
art
and
craft, and with
about 40 years in mass production,
we feel
the glass container busi¬
ness
busi¬
manpower
Foundation
Solid
and
longer in an un¬
stage of economic
no
Hemisphere.
under
So, with 4,000
of
velopment has accelerated at a
tTIMieliddus pace, with its capital
formation rate trailing only Can¬
countries seeking to encourage and
containers.
ex¬
in. recent years Puerto Rico's de¬
material—glass.
of
better
type of supplemental financing in
a
nondeveloping land.
"The truth of the matter is that
Rafael Durand
Hirbtrt R. Silverman
said
minum," and
future
growth.
new
ceram,"
which
that
product,
"Pyroglass-derived substance
to be harder than
amazing
a
establishment
industrial finance company as ad¬
ditional evidence that the Com¬
monwealth is
announcement
Di¬
Economic
Puerto Rico's first commercial and
to
recent
Executive
Rico's
"I couldn't think of
ample
come
Puerto Rican
a group
headed
Government invest¬
ing $250,000.
Talcott's role in the partnership
be to train and guide Na¬
Stockton Broome Jr.
With First Fidelity
will
tional's
personnel in
the day-to¬
(Special to The Financial Chronicle)
day operations of a credit organi¬
zation, and to assist the company
ATLANTA, Ga. — Stockton
Broome Jr. and Robert A. Hamby
finding opportunities for the have become associated with First
profitable employment of its capi¬
Fidelity Securities Corp., 11 Pryor
tal. Talcott will have the option
Street, S. W.
Mr. Broome was
of rediscountsg National's receiv¬
formerly an officer of Stockton
and
the last 10 years.
were
Durand,
of
Development Administration, said:
perhaps
the research scientists, but the
am
today.
20%
Rafael
in
announced
a
ables.
William J. McGregor
ciated with Wm. H. Tegtmeyer
&
year or so
ago, and I can tell you know, that
Broome & Co.
Herbert
R.
Silverman,
President, said:
Talcott
With Daniel Reeves
Co., 39 South La Salle Street. Mr.
"Puerto
Rico's
gross
national
McGregor was formerly in the in¬
dustrial stock department of product has risen at a faster rate
States
With Lloyd
Arnold
(Special to The Financial Chronicle)
BEVERLY HILLS,
liam
Davenport
Arnold & Co.,
is
364 North Camden
Joins Fabian Staff
(Special to The Financial Chronicle)
BEVERLY HILLS, Calif.—Paul
now
over
the past decade, with¬
BEVERLY
funds
available to manufacturers
seph
Stock
F.
Exchanges. He
was
Calif.—Wil¬ there, future growth possibilities ly with H. Carroll & Co.
will be even more Impressive. This
with Lloyd
Drive.
Wilder is
(Special to The Financial Chronicle)
HILLS, Calif. —Jo¬
Black is now affiliated
with Daniel Reeves & Co., 398
out any commercial finance com¬
South Beverly Drive, members of
pany participation. With additional
the New York and Pacific Coast
than that of the continental United
Swift, Henke & Co.
And
quarterly today's product is much stronger.
units—
As you probably know, advance¬
billion units
ments making possible the further
lightening of wide-mouth jars by
by Mr. Cheney before
toe New York Society of
Security Ana¬
lyst8, New York City.
a
will
increase in floor space within
billion
4.1
advances
10 years.
all-time
4.3
these
nation has specific indus¬
commercial goals," he
said.
the number of containers without
The business is working stead¬
Right now American business is
ily, and with great progress, to¬
undergoing some recession. But, ward
achieving greater strength
perhaps because of the factors just with
less weight. The typical pre¬
mentioned, we in the glass con¬ war
quart bottle weighed some 22
tainer business have not yet begun
to 24 ounces; the same bottle to¬
to feel its effects'.
We have just
day weighs 15 to 17 ounces. Quart
completed totaling shipment fig¬
jars that weighed 18 or 20 ounces
ures from our member
companies 25 years ago today weigh 11 to
(representing about 92% of all 13 ounces. In
general, the glass
U.
S.
shipments) for the first containers of 25
years ago w6ighed
quarter of 1958. They show that
one-and-a-half times as much as
glass container shipments estab¬
the same containers
high of
or
a
and
rector
this
activity still goes on
throughout our business. Many of
our people see the day approach¬
ing. when these machines will
make as many as 700 or more
units per minute, and some
of
them have set a goal of doubling
over
lation.
trial
strength
six times
and
some
where
might be
it
is important
only to the people of Puerto
Ilico, but to the people of many
countries throughout Latin Amer¬
ica, for it suggests a pattern which
may be applied in similar cases
our
are
going to
discuss did not come easily.
As
a
cross
section of the broadest
a
matter of fact, the glass con¬
kind of mass market—the kind of
tainer industry has spent an es¬
market
that
stands
to
benefit
timated $100,000,000 on research
greatly from an expanding popu¬
then,
How
accomplished only by
continuing hard work and study,
any
Aug. 19 to provide credit
material
to 10%. But
our
a
glass containers go? Some
41% are used to package food;
about 25% for beverages; another
25% for drugs and cosmetics; and
new
American
"The arrangement
not
about is unknown, except
confirms
might say that our business
•teeps a close watch on the mar¬
kets
for
glass
containers.
We
:arry on intensive and continuing
volume
dollar
Continuing Research
1
a
large
a
Cer¬
tainly this can be done within 10
years on a practical basis.
This
obviously means lighter and much
stronger glass containers.
(but
was
crease
formed
and
within the next three years.
in 1957.
Most
shipments of new;glass con¬
tainers in the United States reached
an
riod
investors
herent
the comparable pe¬
reported for
300,000
pounds
per
inch.
They
are
far
than steel. Our goal is
raise our utilization of the in¬
commercial finance company, was
to
competitive.
The1 year just past — 1957—•
marked
the third
straight year
of
A unique three-way partnership
involving the Government of
Puerto Rico, private Puerto Rican
square
opines expanding population and
year;
glass
strengths in
ordinary
stronger
new
need for food
help make the industry's future look most attractive; and
emphasizes continuing research progress in making glass
last
that
tensile
show
excess
glass containers and prospects that 1958 may
be the fourth straight year is given by Mr. Cheney in pointing
out that so far the industry is running contrary to the general
business trends. Notes the industry entered billion dollar ranks
shipment of
public and private capital, and guidance from James
v.;/"
Talcott, Inc.
the
of
known
fibers
A
Involves
measurable
laboratory strength of glass. It is
about
By RICIIARD L. CIIEXEY*
of
Thursday, August 21, 1958
.
Unique Three -Way Partnership Formed
To Help Finance Puerto Rican Business
covering no - deposit beer
bottles weighing
14% less than
the present ones.
*
*
1
Glass Container Business
to
.
.
(712)
with Fabian & Co.,
9500 Santa Monica Boulevard.
former¬
partnership is another practical
Guerdon Smith Opens
example of free enterprise in op¬
(Special to The Financial Chronicle)
eration, with a Government stim¬
ulating business expansion, not
PASADENA, Calif. —Guerdon
controlling or hampering it. Tal¬ D. Smith is engaging in a secu¬
cott is proud to have been chosen rities business from offices at 595
to assist National Credit in
ture
that will fill
a ven¬
East
Colorado1 Boulevard
&
opment picture.
with J. Barth & Co.
the firm
Co.
name
Mr.
under
of-Guerdon Smith
crucial gap
in Puerto Rico's industrial devel¬
a
Smith
was
"formerly
Volume 183
Numbei 5770
..
.
1
•»
either
were
unwilling or unable
with. In fact, tne Attorney
General of Missouri requested the
Department of Justice to inter¬
Anti-Trast and Insurance
to cope
By IION. VICTOR R. HANSEN*
General of the United States in Charge of
deal with
Anti-Trust Division
had
Department of Justice, Washington, D. C.
exemptions
industry.
ance
bureaus
Mr.
Hansen
and other practices
deals
with
legality
of
of
some
his
rating
Diversified
Services
in
We
are
the
Anti-trust
of
aware
insurance
in
believe
the
importance of
enter¬
Importance, and we
private
our
prise system.
Division
that
there
should
not
be
un¬
interference
with the busi¬
insur¬
of
ance.
On
the
mother
hand,
that
the
to
due
of
public's
interest
and
safety.
In addition to under¬
standing the special problems of
those persons respon¬
regulation should be
anti¬
sible for its
of the part played by
in
trust
tree
our
enterprise
sys¬
tem.
Let
hits
Sherman Act
separate
at
persons
actions
or
cept underlying our primary anti-
or
firms
or
The form of the
straint of trade.
concerted
and
action
Congress
was
used
immaterial
the
broadest
words it could to strike down any
action
which
restrained
Although at the time the
joint
trade.
passed the so-called trust
was
favorite
was
review briefly the con¬
me
Section
corporations which resulted in re¬
Act
The
the
of coercion,
from
the
op¬
cott
Federal
the
that
so
the
At
measures.
staies
draft
to
Anti-trust
termination
anti-trust
the
"to
acts
became
law."7
of
size
has
ap¬
recognizing
which
the
for
achieving
Association
from
Association
terms.
members
business
joint
device
action,
the
Sherman Act forbids combination
sales
continued to
ciation
and
were
usually
if
a
both
state
authorizes
-members
or
subscribers
devi¬
to
ate from the established rates and
effectively supervises them.
to the insuring public
to pass on
Responding to the invitation in
Act, almost -all the
states
enacted
new
provisions
on
the results of economies in opera¬
tion^ If carried, too far,' siicH con¬
duct may be regarded as coercive,
and thus interdicted by the anti¬
the McCarran
regulating the business of insur¬
ance.
Tnese
laws,
in
general,
permit cooperative rate making
through licensed rating bureaus,
but incorporate certain provisions
designed to preserve competition
and to correct the abuses which
who
punished
a
trust
right
brought
Court's
about
the
decision
in
The
Soutli-
general pattern of the state
legislation
Inspection and rating bureaus
and
local
groups
of
insurance
moratorium
age.
enacted
during
establishes
the
(1)
the
The
conspirators defended on
that they were not
required to conform to the stand¬
ards of business conduct estab¬
Reasonable
an
insurer to
unrea¬
with
the
act inde¬
available
to
other
in¬
surers.
With
respect
to
these
bureaus and their advisory
competition in
it should
insurance industry is neither
be noted
out-of-state
prohibited nor discouraged.
ground
of
generally
the
fol¬
lowing principles:
agents policed these conspiracies.
Examples of
interference
pendently in the matter of rates
and rating practices might include
harassing
litigation,
collective
pressure upon lenders not to ac¬
cept
the
policies
of deviating
companies,
and
collective
at¬
tempts to deny the insurer access
to statistical and rating services
Supreme
the
laws.
sonable
Eastern Underwriters case.
and with withdrawal of all patron¬
the
Act,
Rating Bureaus
represent non-Asso¬
companies
are
lawful
withdrawal of the right to
represent
Association members.
Persons purchasing insurance
from
non-Association companies
were
t hreatened
with
boycotts
by
Division
encroaching
of
forbidden to
A recent writer 8 has described
such as rating bu¬
-the. antagonism of some rating
reaus, may be essential to sound
bureaus toward attempts of their
insurance, declares such practices
Non-member
agencies
Anti-trust
intention
those matters which are
properly state regulatory prob¬
lems; instead, it is our intention
to be helpful to the insurance in¬
dustry by pointing out pitfalls
and areas of possible violation.
practices
some
the
that
no
businessmen,
companies were.cut off from the
opportunity to reinsure their
risks, and their services and facil¬
ities were disparaged. Those in¬
dependent
that
McCarran
advis¬
upon
such
that
extent
the
Thus
their associated
and
bodies. Before discussing this,
however, I should like to empha¬
plicable to the business of insur¬
other
ac¬
insurance
ory
this moratorium, the Sherman and
charged in the indictment that the
member companies of the Asso-
and
intimidation and boy¬
activity of rating bu¬
tne
in
reaus
wouia
regulatory
was
the coercive
boards, which I will discuss later,
we
are
also concerned with acts
three
a
to
lenders
of
for
the
time
have
or
engaged in by at least
two people.
The evil that Con¬
gress was seeking to prevent by
this Section was the joint action
be taken
aware
contract,
activities
insurance,
Laws
for
business is not regulated by state
pub¬
the
tions
moratorium
ousmebs
of
eration
been indicted for
violate Sections 1
provided
ance
This
Victor R. Hansen
Act
partial
insurance
to monopolize" jciation controlled 90% of the fire
guilty of a insurance and "allied lines" sold
misdemeanor.*
Basically t h e r e by stock fire insurance companies
in
six
states.
The conspirators
are
two types of conduct which
not only fixed premium rates and
are outlawed by the Sherman Act
concerted
action
by
two - or agents' commissions, but employ¬
ed boycotts, together with other
more people to restrain trade, and
monopolizing by one or a group types of coercion and intimida¬
tion, to force non-member in¬
of people. : ;
V
<
surance
companies/ into the con¬
Assuming that interstate com¬
spiracies and to compel persons
merce is affected,
then Section 1
who needed insurance to buy only
of
the
Sherman
Act
condemns
combination in
otherwise, or
conspiracy which restrains trade.
involved,
safeg u a r d s
must
The
addition
In
of state and Fed¬
system
trade shall be deemed
the form of trust
interest
for
other
any
operation,
of the McCarran Act—which
and protect healthy
in the insurance in¬
dustry—becomes undermined.
eral control.
year
It
of
pose
designed to evolve a coor¬
dinated
person or persons
very
definite
lic
conspire with
or
every
however, I do
feel
bine
terms
Under¬
and 2 of the Sherman Act.
methods
competition
membership of the Asso¬
ciation, 198 private stock fire in¬
surance
companies and 27 indi¬
discouraged "tie-in"
and
is to preserve
Association. 4
viduals, had
conspiring to
instead, Congress
the McCarran Act.
as¬
that state regulation would
continue unimpaired, but on
The
other complaints.
some
Southeastern
v.
rates
to that extent the underlying pur¬
passed
—
necessary
ness
has
case
otner
and
the
for
suring
as
ac¬
States
department's investigations related to
practices and reports receiving
anti-iru»c laws,
area
per¬
suade Congress to overrule it
to
exempt
insurance from
to
complaints
writers
under the 1945 McCarran Act,
possible violations of anti-trust laws. Notes widely publicized
Investors
with
made to
were
or greatly restricts the
independent actionem
eliminates
decision, deter¬
Following this
mined efforts
tivities in the southeastern states,
resulted in the test case of United
probes the state of health of competition in the industry, and
reviews
attempts
own
boycotts and other coercive
to
the competitiveness of the insur¬
on
his
rate-fixing conspiracies
This complaint, to¬
failed.3
gether
Federal anti-trust chief analyzes the interdictive effect of anti¬
trust laws and
after
vene
Assistant Attorney
13
(713)
The Commercial and Financial Chronicle
rating
bodies,
that when
insurance
an
organiza¬
tion recommends the adoption of
rates or standardized provisions in
(2)
Uniformity in rates and
"in the form of trusts or other¬
Sherman
Act.
rating systems is permitted but
wise,"
together
with
contracts
insurance underwriting in a state
beginning,
this
lished
by
the
Sherman
Act not required.
and conspiracies.
in which it has not filed as a
country accepted the basic phi¬
because the busines of fire insur¬
(3) No insurance company is
The second Section hits at
a
losophy that the public interest
ance
was
not
commerce.
The required to become a member or rating bureau or as an advisory
body, it may be engaged in illegal
is best served by the existence of different type of offense—monop¬ United States District Court in
subscriber of any rating bureau.
This can be done by one
; competitive
activities, and the acceptance of
conditions
in
our olizing.
Georgia upheld this defense on
(4) Independent rate filings and : these, recommendations
person and does not require the
by the
r economy. This philosophy is "based
the authority of the Paul case. The
rate deviations are permitted.
local rating bureau may result in
joint activity of independent en¬
.'upon the premise that the unre¬
Supreme Court reversed this de¬
tities the way the first Section
Recently there have been; at¬ illegal price-fixing or other un¬
strained interaction of competicision, however, and held:
does. There may be lawful monop¬
tempts in several states, either by reasonable restraints of trade. :
tive forces will yield the lowest
"No
commercial enterprise of
olies, such as those growing out
proposed legislation or by state
prices, the best allocation of our
Finally, state regulation means
any kind which conducts its ac¬
of valid patents, and there may be
regulation to require complete
economic
resources,
the - highest
1 constitutionally valid regulation.
tivities across state lines has been
other monopolies which are not
uniformity in rates and policy
quality and the greatest material
With respect to some states, the
unlawful.
But
it
violates
the held to be wholly beyond the forms. I do not wish to express
progress, while at the same time
^question may be raised as to
Sherman Act when someone ac¬ regulatory power of Congress un¬
any opinion as to the merits or
providing an environment conwhether the grant of what can be
der the
Commerce Clause.
We
validity of any specific state ac¬
ducive to the pcrservation of our quires or maintains a monopoly
considered1 governmental power
cannot make an exception, of the
over
a
tion.
I would like to say, how¬
part of interstate com¬
democratic, social and political
to the private rating bureaus is so
business of insurance." 5
merce.
ever, that to the extent that the
r
institutions. Your special interest
great as to be invalid on constitustate
imposes strict conformity
The
constitutional
provision
3 Joint Hearings before Subcommittees
^in one of these products of com¬
j
Continued on page 20
giving the Federal Government of Committees on the Judiciary on S. upon the insurance industry and ;
petition,
"low
prices,"
is
evi¬
1362, H. R. 3269 .and H. R. 3270, 7«th
denced by the following quotation the power to regulate interstate
6 59
Stat. 33
(1945). 15 U. S. C.
-a Ely,
Cong., 1st and 2d Sess. 25 (1943-1944).
Government Regulation mt Inand foreign commerce provided
from this Conference program:
§§1011-1015 (1952).
?
surance
Marketing Practices, 1954 Ins.
4 322 U. S. 533 (1944).
trust
law,
From
:
its
the
very
1
/
■
.
•
'
.
-
.
••
„
.
.
.
*
.
.
the basis for the enactment of the
Throughout the two and onehalf day meeting heavy emphasis will be on cutting costs
on
helping you. make your insurance
buying pay off as an expense re¬
.
.
...
duction item for your company.
Thus all of you are
work
your
of
the
by
affected in
effectiveness
the
procedures
policies
used by the Anti-trust Division in
and
ensuring that free and open com¬
petition rules the marts of trade.
It
in
was
accordance
with
this
-philosophy that Federal legisla¬
tion was sought to meet the threat
to "free enterprise" which devel¬
oped during the period of indus¬
trial
expansion
following
the
Civil
War.
This
traditional
faith
in
the free enterprise system was
given Federal legislative expres¬
sion by the passage of the Sher¬
man
60
Act in 1890.
For
more
than
this statute, with minor
changes and supplementation, has
years
continued
to
reflect
the
national
Act
states
unequivocally
conspiracy in restraint of
is illegal and that "every
trade"
who shall
person
attempt
♦From
fore
7 15
553.
U. S. C.
§1012 (b)
(1195).
L. J.
Court's
preme
interpretation
constitutes
has
merce
interstate
the
to
an
monopolize, or
monopolize, or com¬
address
American
New
York
by Mr. Hansen beManagement
AssoCity.
192.
changed
of
com¬
considerably,
The
undersigned have placed the Notes, described below, with institutions.
This announcement appears as a matter of record only.
'
just as commerce itself
changed over the years.
has
Prior to 1944 the business of in¬
surance
was
not considered to be
to the authority which
Congress derives from the Com¬
merce Clause of the Constitution.
subject
$5,000,000
This
exemption stemmed mainly
the ruling in Paul v. Vir¬
ginia 2 in 1869. An out-of-state
insurance company had chal¬
from
Virginia's
lenged
right
to
The Eimco Corporation
make
it post a bond before issuing poli¬
cies to Virginia citizens. The Su¬
Promissory Notes due August 1, 1973
Court held that insurance
policies were not articles of com¬
preme
and, therefore, state regu¬
merce
lation
did
Federal
not interfere with any
authority.
In the 70 years
This
that "every contract, combination
in the form of trust or otherwise,
ciation,
at
can
what
policy.
or
5 Id.
and means that the
only be applied where in¬
terstate or foreign commerce is
involved.
As you know, the Su¬
Sherman Act,
Act
the
which followed
decision, the states ex¬
varying degrees of regu¬
and
supervision.
Despite
Paul
ercised
lation
qAllen
this, by 1942 the national insur¬
ance
scene was
characterized by
concerted activities and restraints
on
competition which the states
126
Stat.
TT
2 79 U. S.
209 (1890), as amended, 15
T"
seq. (Supp. IV, 1957).
(8 Wall.) 168 (1869).
August 18, 1958
&
Company
14
The Commercial and Financial Chronicle
(714)
On
■
Basic Investment
Policy
A Bank's Tins! Department
Property Tax.
Miss
Naylor opines both small
.
As
•
trustees,
.management
d et
property.
this
If
skillful
which
ir m i n e
e
what tools
need and "what
the
the
ite).
of
bonds
lation
two
tools
a n
stment
e
indicate
policy.
What
in
v
is
an
ity
estment
;
cussions
or
A. Naylor
May
and
overall
have said it is
Need for
What
a
trust,
there
are
policy?
a
policy.
It
needs
the
of
it
or
may
that
be
may
Pfds.
41'i
Districts
*
interests
40
Richmond
37
44
47
6
''
47
„
—_
Chicago
■}{'
13
40
48
9* •
39
3
2
41
__
47
2
—
5
43
38
10
50
San Fran.__
39
5
54
''Reporting
through Dec
',
dates
31,
\
: 14
:
from
range
the
ferreds
Cleveland
Districts
Oct.
accounts
10
adopt
and :
Pittsburgh) '
Philadelphia
(includes
with
compared
other
pre-
cities
some
you
Take
able at 120 and has
of
it.
In
..
the
.
It is call-
.
Bu
as
cud
nu&t
damental
the larger one.
One of the major advantages
"that it represents group
tho
■
some
challenge
a
stimulation for
a
littie
and
Let
£?roun
us
is
fundamental group, lust.
the
ments.
This
the
individual
of
more anal-
the
means
of
a
f
the
easiest
selection
securities.
One
to decide
ways
quality is to have what
we
on
call
d.itv
means
to
onr
l«TLv
..
a
£
it lis .-.net ;a
the
nurchase
life
|Pmnk
is to stick
inv^lves
whtoh
^
other
the
ac-
wjii
is
advantages
and
inter¬
the
best
re of investmentsList This is a list
*? Approved
the
which because of
thoughts
of
group; a keener
the investment
understanding of
objectives; a will-
<ingness to follow an
policy in which the
sman
has
had
judgment
can
.everyone" is
their views.
investment
investment
some
part.
Group
be achieved only if
willing to
express
:
A
second
advantage
is
uniformity.
A
formal
investment
policy means the uniform application
of
group judgment to all
If several
individuals
accounts.
earnings record, type of business,
good management, and favorable
outlook have sufficient quality to
be purchased in tiusts. What ; I
am speaking of now is a quality
list, not one which represents a
are
reviewing accounts, several
patterns
of
investments
would
"best buv" at anv narticular time,
buy" at any particular time.
-.
The mechanics
this.
are
If you
going to initiate this, then you
begin by gradually adding to the
list
each
company
you
review
are
which
there
form
to
seems
and
enough
are
a
qualify.
difficult
not
are
modest
list
Bonds
certainly
commons
in
to
w:ii
the
to
litth
involve
11ndntiW-eHi.ir he
SL
trinle
-isk
On
sound
on
stock.-
,own
specifically
V
to
clear
the
states
;
that
we
not
in
portfolio
refers to timing
management.
It
only and
selection.
plans,
Wc
first.
It is
too
wlth
cIosc
problem.
0|,r
to
We
Formula
Plan
device8to
the
act in accordance with some predetermined plan to exploit the
rise and fall of security prices. It
may be that stocks are bought or
•vidual were conservative,
perhaps some utilities, bank stocks. Hav- s°ld when the averages are in
:reluctant to take any risks, you
ing compiled a list, it Should be certain areas. Another formula is
imight find a preponderant amount reviewed
regularly.
Jhe Ap- the maintenance of a 'constant
of triple A bonds.
Another indiproved List concept has many ratio of bonds and stocks. In a
vidual,! in the same institution,
advantages: (1) new investments rising common market appreciaimight be more forward looking, are in securities where
all are in tion may1 carry your common perprobably result which could be at
least embarrassing to the bank
•or
perhaps worse. If one indi-
of
aware
the
rewards
of
good
beginning — General Motors, General
Electric, du Pont, Eastman Kodak,
Standard
of
New
Jersey,
agreement
on
aualitv
—
eronn
centage to
65%
say
common
the
put
operations
inadvisable.
v
to
Whatever
so
that if
your
which
t
*
n
Approved
substantial
the
manage¬
consequently,
should
Proxy fights pres¬
the only policy
of
the
in the best
seems
stockholder.
(5) Rights — If you
Approved List, a policy
i-
is simple.
proved
If
stock is
a
List
an
rights
on
the Ap¬
on
exercise
you
».
.
have
' the
rights, if it is not, you sell. Sub¬
ject to
the
restrictions
of
the
trusts,
it
becomes
almost
auto-
•
ma-tic.
•
v
•
,'*
J«,
'•
>
1
,
*
7;
Investment Policy
."**"•
'
.
Trust
vs.
by
.
There
times when any in¬
policy must be ignored.
are
vestment
The
provisions of
restrictive
so
almost
some
that
impossible.
Pennsylvania is
trust
The
are
First
old trust
an
are
changes
com¬
commons.
191.65.
pany and, consequently, has some
old accounts.
In one we are di¬
In-
By
July 1957 when the Dow-Jones
was above 500, the common permore than
rected
.
hold
to
the
and
Elmira
Williamsport Income 5's until
turity
after
be
to
are
which
ma¬
the
invested
proceeds
legal secu¬
in
50%.-
rities.
In the latter part of 1957 we saw
the interest rates, which had been
port Income 5's mature in 2862.
in
rising
a
new
trend,
culminate
bonds with laree
v
Provisions
one
ferreds, and 29%
During 1946 the Dow-Jones
centage had climbed to
Approved^. List
like
we
here is do what
this diversification on June 30,
1946: 40% in bonds, 31% in pre-
was
The
and
interest
a
group of funds. One fund
which I have knowledge had
dustrial Average
the
ent problems and
or
in
/
opinion
our
are
on,
vote for them.
To repeat — the direct cause
variations would be economic
fund
are
that
ment
ing.
of
It is
—
where there
or
holdings.
on this subject,
n
which
trustee should send proxies
those companies, the securities
means
may decide it should set
•
serviced
determinant.
a
List
are
exercise objective opinions. The
conservative P°lic>r would be to
seW except where specific right of
retentlon 1S given;or where other
^dividual aspects of a trust would
1Tiakc it
of
automatic
an
a
to
,
.
the
take
fre¬
wrong place.
It
the dollar value,
be
the
(4) Proxies
of
v'v wt,
changes.
This is -exemplified
the-changes in diversification of
shall
we
call the Flexible Plan.
us
trustee.
most
for
the
be
that
shall
called
one
Formula Plan, the other
Let
the
economy
the
seems
could
can
nolicv" ; ; ^ariab,e Investment Policy
- Variably Policies -refers
to diversification. We have touched on
cleai
investments
not
for
asked
much
so
which
this when vve discussed the fiexi-
two
for
value-
known—
greater
convenience
should
instrument
) Investment Timing —.This Jbility necessary in any investment
refers to the -method used to policy, also under investment tim-
,
its
to
well
diversification
question
there
company
as
are
account,
emphasis in
compensa¬
Your Own Stock_
If
s/i,
faee
xxmiW.med iw
A
a
cover
country.
but rather the number of accounts
vi«& -".w5risk
more
e
fh if ^nect of
if!v mus? he formnl-tod
change
this
quently is "What is the minimum
many accounts we jreceive our
the
on
trust
question
some
greater
,
renting
in
is
h,.t
trustee, but ;utrustee
it: can be
consjdered good'management and a
ior
by only about 17% of the
companies
smaller
Its
.
a
and
adopted with advantage
needed
have
adequate
time
policy which
a
Statistics indicate that this
used
Tl is
should
:
both
is
fund?"
of
The
buvin^
hand
POnmnnr
it
all
on
relations
(7) Policy
?^Cebut weTlso°have
One of the most important
general quality of invest-
(l)
is
direct
only the bank but the
amount
vff-
geneiali" means me puicnasc or
common stocks. We as trustees
first
his
usually senior officers' time and
banks
com¬
(3) Common Trust Fund—With
or maintenance, of ,r>ur- ^Uinue to hold this stock
generallv
Fundamental Investment Policy
judgment.
Any policy should be formulated
only after a thorough discussion,
As we all know, a discussion of
this kind brings forth different
ideas,
variable.
fundamental
***
is
and
be
to all.
These problems take time,
policy
We
must
we
cannot
we
saves
and
money
-to
^
company as well
It
The
business
in
man
small
with
when
benefits not
none"
t
rela¬
our
co-fiduciaries.
co-fiduciaries.^ '
trust.
wlthhiw..
.-
(2) Nominee Registration—This
eliminating
.
these
^
.
.We must
—
policy in
some
times
with
cannot
time
considerations:;
responsibility but
ment
which would be too
same
invest¬
an
cover
such a policy
is developed and
fostered, it will help the invest¬
situation
"take
should
tion for this additional work.
either. conservationor
,
be
flt to the trust and the tiustee'
ests.
«> Maintenance of
~ca?e
a
.
fol¬
promise and must remain firm. If
connected
has great merit.
KSt nvS principal
is
between
*
always remember that there will
(b) Compensation — We have
just
mentioned
the
problems
debt ahead
no
it.
always
trustees
' hflitvT.f Jrvi™
opinion, this stock
my
This
costly and at the
writing) the du Pont preferreds
—the $4.50 is selling about 110
to yield 4.1% free of Pennsylvania
be because
particular
that a co-
not
cases
more
a
-be
Considerations
with
trust
-those
(at the time of this''
Personal Property Tax.
tions
promise
tp
straining tor
are
develop
could
theTr'place "in" trusts,""esperially
where
is
policy of
per¬
money,
.
Co-Fiduciaries
share
Perhaps the best
they can do is to have a policy
of being selective. This is a com¬
SyiVania Personal Property Tax.
j happen to think preferreds have
come.
a
new
\
policy
(1)
"take all."
or
of
seems
which
Sometimes
which
.most
capital
somewhat
could
program
important
responsibilities, but
advisable.
of
With
/
ment
the alternative is to refuse such
refiect the influence of the Penh- '*
to the
these
to
a
Operating features in
fre¬
are
sume
1957.
percentage
the
in
trusts
2
-
that
—-
1
'
where
Note
simply
We have arbitrarily divided
to
cautious
possible sale, and always valua¬
tions for tax purposes. Trustees
are not always prepared to as¬
'■
ty
51
38
p
toll*
account
so
period of high prices,
a
lowed.
involves management of a busi¬
ness, somethimes valuations for
•
54
Minneapolis
in
-
quently difficult.
•
-
(i
14
Kansas City
Dallus
|he
not
I'/#.
ac¬
The
higher percentage would be
in
diversity of opinion. There
probably some who have
had this problem. Business
are
etc. .,?■
47
•
™wei
discussions or tnis.
.
this
taxes
mitted in these.
mort-
is an area where just
'*• "
23
rity, but the end result is that an
exception will have to be made,
What ad-
and
some
•
58
'44
30 " i
St. Louis
:
:
Cleveland.—
1946.
Loans;
43'i
4
Atlanta
the
-
•
Com.
5
menffohraSs^eei^!rclratsecu:
in.
gains
there is great interest and
now
;*-■
Wo
38
50
Philadelphia
co-trustee.
a
subject
—
into detailed dis-
real "estate
on
p[ (a) This
Reserve
guide.
advantages
having such
of
Investment Policy
an
is
trusts which
'''
Bonds
Boston
trustee
cannot be made to conform
actions in the management cf in¬
vestments.
Remember here that
we
are some
not go
invested
considered.
at
.
Qualifications
older,
be
may have been purchased
low prices so that the current
high
percentage
would
be
ap¬
preciation."
Any cutback would
is
the -short¬
as
(6) Business Interests
Funds
1957* ■>
New York
trusts,
sole
is
IIofdingK
Cash
climbed
individual
bank
whether there
there
dis-
in
the
well
as
Mortgage
cussions
ReafEst?
All
l'or ilexibil-
reason
(5)
We shall
trust
Federal
-
-
.
change in overall policy.
in the
lies
Whether
policy? It is a
guide to be
used
a
"
-
attractive and would
Tho second
Trust
District
r.
Certainly this change makes
more
<
.
*
4.17%, with only .58% difference between the bond yield
and
that 011 commons (S. & P. compos-
formu¬
firmness
the
must
Other
to
Irn-
more
.jportant
this had
1957
November
to
is
common
also
keeping in mind the
as
Common
in
since
the
long-term
of
This
13.8%.
of
of
true
Tn vestment
corporates then had
yield of 2.51%, hut. by
ari average
follow. One of
.
com¬
changes
occurred
has
High-grade
we
procedures
Broad
a
here
term outlopk.
en-
low
a
but
necessary in
of
count
compiled by the Federal gages other thaivto
say that.it is
Reserve and published in the May.
a
subject
about;, which
there
1958 issue of the Federal Reserve
should be a policy on
terms, qualBulletin.
ity and types.
indicate
changes
not
only in individual securities but
in our overall investment policy.
Take the change in interest rates
care,
college
high
to
also
economy
we
the
funds—from
funds
large trust
as
economic.
and
care
first
must
we
of
exercise
to
are
investment
our
skillful
of
some
pects
common
example of. tions,
an
.6%
an
.'Junction is the
is
well
as
As
dowment
approved basic investment policy to guide their
investment procedures. She holds such an investment policy
should stipulate certain fundamentals (ench as: 'quality 'list
of investments, place of preferreds in portfolios, policy on
maintaining purchasing power, formula and flexible investment
timing plans, and management of a business) and should
also allow agreed upon flexibility in diversification to fit chang¬
ing economic conditions. The author, further, deals with
operating policy covering: co-fidduciaries, nominee registration, common trust fund, proxies, -rights, and when should
policy be ignored.
panies need
in
ages
Trust Co., Philadelphia, Pa.
The First Pennsylvania Ranking and
The flexible plan also has advantages in that changes are made in
accordance
with current condi-
the difference of opinion, look at
the spread in preferred percent-
Officer
Investment
other
hand they provide
of income and freedom
the Pennsylvania Personal
from
By MAY A. NAYLOR*
Trust
the
stability
m
Thursday, August 21, 1958
.
.
.
counons
The
Elmira
and
Williams-
in
Two With Old
—
Colony
-
(Special to The Financial Chronicle)
EAST READING,
•would tend to
;man s
the best of each
use
thinking
and
apply
it
to
accounts.
Policy
Flexibility is
policy
vestment
cannot
be
so
a
must.
should
sacrosanct
changed
or
3iot
applicable.
What
we
foresee
which
♦from
a
a
change?
taiw
through having higher quality
se-
hv
by restricting the list of securities
Flexible
can
Plicate
ultimately benefit the trust
curities and it benefits the trustee
Should Be
considered
will
No
in¬
be
ever
that
it
considered
the
regular
reviews
must be spread.
wonder
you
included
as
Perhaps
why this should be
subject for policy,
—
a
It is because there is
ference of opinion as to the
place
of preferreds in
in-
first
v,
is
f
The
shall
a
great dif-
portfolios. They
may be adopted,
other
call
S.
not
bonds issued at this time
had non-callable features for specific periods or were non-refund-
some predeRather, all invest-
able with lower coupons. A situation like this, with high bond
method
flexible.
is
It
i
porate
•
one
does
moves
are
made
after
come
but no maturity and
after the tax collector,
yields
and
some
of
our
growth
Here stocks yielding 3% or less, cerd is important to distinguish be- tainly calls for a reappraisal of
tween conditions
indicating
a our ratios.
The fund to which we
trend and those which may be referred had increased its bonds
only a minor flurry.
>
and
decreased
common
to
less
An
advantage
of
the
formula
stocks
u
bonds,
re-
Albert
row
are
and
now
Mass —Gladys
Sumner
affiliated
H.
Wood-
Old
with
Colony Investment Company, 213
Main
Street.
ously
with
Both
Palmer,
were
previ¬
Pollacchi
&
Co., Inc.
viewing current conditions.
c?nside.re(^ to be hybrids with plan is that at least some
^
income and call price are sold at high prices in a
they
we
operate according to
termined plan.
ment
(2) Preferred Stocks
conditions
Pennsylvania
Bankers
Associations
Trust Training School, Buckneli University,
Lewisburg, Pa.
which
would
The
mi«
over
which
market,
but
formula
plan
adheience
requires
to
than 50%.
In
rising
this
any
an
and
firmness,
not
(2)
a
we
can
(1)
accounts
new
accounts.
dual
(Special to The Financial Chronicle)
BOSTON, Mass.
has
outline
into
Now With Lerner & Co.
separate
ner
become
&
invested
This
policy but certain
is
as¬
He
Jerome Coe
with
Ler¬
Co., 10 Post Office Square.
was
blower
—
connected
&
previously
Weeks.
with
Horh-
Volume 188
Number 5770
.
.
The Commercial and Financial Chronicle
.
(715)
'
4
for
capital
gains, iL also has the
reducing bank income;
effect of
rather
':
Possible
Future
%
-J-r
t
*
If
'
Trend*
speculation regarding the
-"
Economics
Professor of
uardin^
the' probable
mercial
After
summarizing the current economic situation, Kentucky
professor advises bankers on the many factors affecting the
employment of bank funds.
tion
tailored
*
;
fit
to
individual
/H.
>
distribution of bank assets.
•Rente
utzxnft
u
•
i
af^tid'hvJprtSS
con-
the
fho
the
g
—
-
wi t-
nessed
cline
increasingly
Adriitirmnl-nit*'hfTVP
curitieiwere
still
to
v
r
a
y
widely;1 For
a
John T. Masten
•,
..
This has been
agricultural areas.
the recession
has. been rather deep and severe
many
communities
communities.
been particularly true
denending
aepenomg
late
e
inis
iius»
.
nus
nas
of commu-
heavilv
neavny
upon
upun
etc.
textiles, coal,
bank
funds,
managing
the
banker must take into considera¬
local
aa^i
time
same
trends
and
conditions
the
a^
begin
to
buv
Gov-
u-'u~
+u
A
an^
iH
Whether this is merely to
u. S. Government issues
is
or
from
20%
*
to
shift
• j
for
and
in
«
■
p10vided'commercial
additional,
keep
m
0f
member
.
credit.
mnnp(ar.,
S7
a
situation,
nolirv
some
banks hold
term loans-
would
as
a
mainly
result
shoit—
ghoVv
bllYw
thev hive
vigorously in an at-
more
the
+n
a
the
Rank
deeline
larger flow of funds coming into
bank
to
meet
denosif
was
a
a
loans,r such
as real estate loans.
Average maturities in the investment account are different from
Banks would seek
,ban^ reserves.
and.additional
-
investments in-the open
market, driving prices still higher
,
...
_
_
a
with-
The
pniiop
.
,
,
fiscal
™d
J®™?,.!?;,??™
1f.Ltu JVZT
'
'°ans w0"ld conti"ua *>*11. Mon- drawals or new credit demands.
billion
P°bcy wouM iurther add to Other banks will hold longer-term
banks.
.
an
jn theKentucky
ances
survey,
of variation from
low of 38.30% to 5.74%.
range
stability but
greater
-
is
this
staointy out mis is
™oneiaiy and iiscai policy wouia term loans, as a resuw, tnej nave not aiways true..
•til 5
deposits
bank
-
.
In such
ward trend.
...
banks with
additional
aaaitioiidi
an
an
expansion, in
Individual Bank
.a-
different ratios of capital to assets, a usual occurrence will need to
Soihe have stable deposit variation maintain a .more liquid position
experience while deposits in other than if its deposit accounts are
banks may show considerable in- quite stable.
biterlude in a long-term down- stability. Loan portfolios vary; r Time deposit accounts usually
nolicv
i
,
oncv
nag provided
in policy has m-oviciea
for
101
base
base
event, the size and stability
however, of deposit accounts will affect the
T
,
additional-reserves oi the reserve be used
aoout .>i.a
blulOT1 anc| ]las easeci
change
In any
The second assumption, is
a pessimistic view.
It
assumes that thb slight recovery
of tbe past two months is but an
eomitrv
of ^nbout
reserves
may show large or •
variation during the year,
small
: based on
11%
monetary
j
or
^2)
to
18 %
The
to
deter-
have large
balances. Total de-
average
posit balances
a
combination
a
mav
do-
for Reserve TUv banks from
to
or
These accounts
v^r^iiiade *
•
ifi i T %
hnlrt
mav
*2 ,5 wa^h ori^St SST,da\sho™n«year were not "
absolute
SOIt of way. Such principles must and lows for the
ban-king would be prof- be tailored to fit individual situa- available,: these figures may un- '
T^ese^^s 1 ^ a the;competition for tions. Banks may differ from one derstate the range. A bank that
for Central savmgs w
d be keen'
■
another in many ways. They have has-a high percentage variation as
domand
AiDril
from! 12^
bank*
of confining its purchases to time accounts
wtofaonary
There are principles relating to show a
l»'e8Sl»'e?' b?nk «ost® would also the management of bank funds high to
Feb-
18%
hanks
Individual
in the market, in- mainly demand deposit accounts,
^uironSnkonions"
«mzaxion
oanKing operations.
cuts
Ci?v hank?
Reserve
suc^i. depressed, industries as_automobiles, steel,
tion
%
,
protection
and while the size of the capital
maintain an orderly market for small
als°
70%
from
4nrrm4
In
Federal
cause interest rates to rise, bills.
'u
the
greater
lntIationary in lts implications.
reduced reauirements
the other hand,
many
Be.nmi
Marrfi
s
more
manv
hrmiPM
deduced
^dd^tioli^
prosperous
than 1956 or 1957.
nities'
mties
50% '
pasi%
h
y
on
ruary, bank reservo
were
Piif.bv
on
commu-,
nities, the
in
the
that it would
aCtlV® Remand for credit stead
m
afford
and safety for depositors than
would banks with low ratios. Obviously, other things are not equal
account must influence managemeiit policy, it is not a factor of
Only last July 18,s°te consideration.
Liquidity is
Reserve announced Provided by assets, not by capital,
assumptions.
restrictive,
SsTfurcbas"^!- %'"A ance 2"?h pariadt.wonld
the?local level
in
by
w
would
to begin all over with
entirely new
discount rate down to
but
ments
On
Unless
fIonetar>'tl:cst"int accompanied eminent bonds
hi
^economy without inflation, by.would
conditions at
true, in
credit.
national policy should dictate oth-
4
infl»tr,n
the
compe-
be
economic
seemed
,
of
return
level
ye a r
13.28%.A If all other factors were
equal, the familiar ceteris paribus,
tent analysts, including most stock banks with high percentage ratios
the
activity
some
bank
A study,
range of variation from 4.66% to
repre-
best
will end
for
one
trnnLvwfthnnt
the
de¬
a
in
general
of
,1
mercial banks had capital accounts
level somewhat be- would be jeopardized.
analysis
situation. However, many
m^eraUngfte pressures on bank b?nks>liquidity to liquidate longerBank
would decline and
....T.V.., ®"a'e
s.h.1..
seeking
past year, we
have
.
a
probably
sented
steps to shift its become monetary policy would
erwise,
cf
restraining
from
thaTmaySbeVdescrSibed as°local°in "folderin^
chartcter
..
_
demand
-4.-
i
policy
com-
assump¬
find
recession
,
At the end of 1957, insured com-
,
is that traders,
apparently seem to feel
shortly and that more inflation is in the offing,
wilf.be followed by a vigorous re- Now, I am not so sure myself. It
cdvery that would carry income is too
early to evaluate the proband production to new highs. Such, able
impact of the events of the
a situation would witness a
strong" week of July 14. We
may have
situations.
affected by general economic
upon
Each
•
,
,
'OW lul1 emPloyment. Until the for example, of 100 Kentucky
* hat week, I felt that the bante, for; thesame date, shows a
third assumption
analvze
(1) Our first assumption
the
and then
they may be
Stresses, among' other
things, the importance of liquidity and significance of the
■
impact
banking.
could
and
supporters,
at
least until last week.'
Projects three possible future
trends to indicate how banks may fare under
each,
deals with general banking principles and how
-
future
tte
'
count also protects the stockholder,
assumption,
,!IS' stability at
"
University of Kentucky, Lexington, Ky.
i
<
jr
•
strong dates' equal to 7.7% of assets. This means
can, ;be ma^e for an inflationary that asset values could decline
revival and also for a
period of by this amount before depositors
ending July
1
19 make
T. MASTEN*
"
inflationary
upon
we are willing to write off the
second
i
-
By BR. JOHN
than
windfall gains.
15
The year 1957
of unusual growth for
vear
•
01.unusuaA grqwtn ior
7
i.
m™7 banks» insofar as tlme de~
posits were' concerned. A large- •
volume of time accounts is usually
re«hrded
commit
enabling
bank
a
to-
larger portion of its as-
a
sets to zviihwiivim
longer-term
uviw
loans and in-
.economic activity,and and yieldslower. While,, Capital one bank to another. Banks may vestments. However, actual variatno.shift in monetary policy h3VC 'possibilities would, develop lisve l-sr§e or sm&ll ieservres tion in deposit sccounts is rnor^
) The Federal' Reserve Index of
tb
investment against ^which - to charge^ losses, important than classification in
terest
rates
in the
general level of eco-'
the
eyer on
nomic sctivitv
Industrial Production held steady
=
100) level
of
decline,
It
reaching
at the 144-145 (1947-49
through
then
1957.
September
started
to
for
of 1958
a
low of 126 in April
a
decline of 13% in seven months.
Since
April,
slight upturn.
1
been
has
there
-
a
$445.6 niiiion ror the third
^>1^0.0 billion for xne imrci
quarter of 1957 to $425.8 billion
for the first quarter of 1958, a
also
,u
Personal lncunic
eisonai income-
4 5%
declined
a
but
by
a
smallerj
Hsing from alow reached in February, 1958.
With declining production and > income, vmemployhas
and
risen
recession high
has
reached
5,400,000
This means
that
there
are
about- 2,000,000
more
unemployed this year as
compared with 1957. The recessioii, so far, has been marked by
reductions in inventory and in the
rate■ of business expendituies for
capital equipment..
a
in Tune of this
of
over
year.
of
3958,
tration
loan
five
months
the Veterans' Adminis¬
reported' a 22% rise in
defaults
insured
on
houses,
total for the five
months' period to 41,087. For the
year ending June 30, 1958, bankruptcies were 23% above the prebringing
,
portfolio
together with the freeing of reserve
balances, caused, banks to
turrr to the. investment market,
the
and
up
prices
Af
io^«
T,inP
viX ^11 S o
l,. .,/!.'' ™te reoTesented
this, i ate repies^nieq
-j
sjderable;<Limprovement,
K
theof
end
;Ss
term
con-
ever
ibp
prevailine
n
have
S'
d -ection
of
fowe/vields ^althou^h^he^movenot
Obviously,
The
%
eveh*
JSLJJSS
S^tobe?^of ^1957
for
long-term
op
^
3 W% to
the' fend
Bv
/
,,
uociwro ,uuuw
of
rates
i-cductions in
We
.
with
,
f
of
,,
• tions. •Governmental .'fiscal, policy
—"
"
;
V
:
"t-i-Z.Z
r
*
of over $10,000
rm
in
•
of priority
follows:
as
on
-
■
The
the asset
as
follows:
-
<:
(1) Adequate primary
reserves.
serves.
^
insured banks).
„A
;
,
Continued
on page
at alevel equal to nearly 21%
of our Gross National Product,
to 8% in 1929 and 14%
in-1933. In the short-run, this
This advertisement is neither
an
aA*e
(3)
It
a
„
i John T. Masten,, Casesm Comment*
Banking: Loans and the Management of
Kentucky Bankers As-
:
is
any one
made
offer to sell
nor
a
solicitation of
of these securities. The offering
only by the Offering Circular.
strong undergirding
NEW ISSUE
Assumption three might be
the sideways' assumption.
assumes
offers to buy
neither
an
inflationary
movement nor a deep,
prolonged depression. It assumes
that the level of unemployment
-
a
there
of
state
is
some
decline,
evidence
although
of
a
bot-
\e '* sa",e ev,dence 01 a bot
,
tommg out.
would continue within the 4 to 6
199,900 Shares
million range, that prices would
stabilize and that the growth of
income would be more gradual. It
assumes
(2) The slowdown in economic
activity has reduced bank lending
that this is the post post-
war era,
loans
outstanding, accentuating the risks
in
any
loan transaction.
Federal Reserve
net
until
the
Shift
Federal
of
Reserve
address
by Dr. Masten at Ken¬
tucky School of Banking sponsored by
Kentucky Bankers Association and Dept.
of
Banking of the University of Ken¬
tucky, Lexington, Ky.
of
easy
reduced
.
November
(3) The Federal Reserve policy
money,
together with the
demand
has forced
a
for
bank
competitive up-bid¬
ding in security prices.
may
provide
Note:
*Ed.
raised
from
Reserve
credit,
some
While this
opportunities
Margin requirements were
50 to 70%
by the Federal
effective
Tuesday, Aug. 5,
1958.
OH COMPANY,
COMMON STOCK
inc.
.
that the pent-up demands
these
on
.
.
and
(Par Value
5$ Per Share)
of the depression and war years
thorities
losses
1 ^
THE HARATiNE GAS
been
weI1 °" the way to having
satisfied.
If
the
monetary and fiscal au¬
willing to live with
were
conditions; prices, including
rates, would stabilize.
interest
Price: $1.50 Per Share
Copies of the Offering Circular may be
obtained
from the undersigned.
While there would be some, unem¬
ployment,
critical.
firms
it would
would
find
stability but not
its.
Successful
such
based
be
less
than
Banks and other business
it
one
a
enterprise,
circumstances,
on
period
of
of lush prof¬
managerial
under
would
be
capacities
S3 ■'
__
deaP and'protracted deProssion—-at least short of national
called
the situa-
(1) Economic activity has been
in
listed
.
a
Local governmental expepdituies
or¬
side*
(2) Adequate secondary re-
currently too willmg rto mcui The suiplus, undivided proiits and ganjf punds, The
large money creatinS deficits to reserve portion of the capital ac- 8„ciati<m, lass.
attendant
prices
summarize
may
od^.h^mva..
,
of the balance sheet may be
data sheds much
PeiWihaliy, I feel that- it is the principal cushion protecting deleast Hkely «t»Wf.three assump- positors against loss (for accounts
June> A^a», tne yieia naa lanen constitutes
to 3.19%. But July has seen a force,
firming
der
Americans light on the policies followed by
most
;
,
liquidity is determined by
the nature of bank assets.
as
neak. vield
cnpntacular
current
Balance sheet
*'
.
icl
Bank
.
^
nf
pnri
fhp
yields
;
lending activity.
bank
that
T,
Ti ^AugusT would be unhappy in the situation funds. in^ the manage me n t the
banks The capital account is of
described under this assumption,
biUs" avemged
1Q=7
date...
increases
*An
,,
but always within the framework
Alme, increased the risk that is
necessarily associated
with
all
1957,
.
of sound managerial principles,
opportunities and has, at the same are
bankruptcy,
was
determining management nolicv
"differences found from community
ment market. This could have un-
four-fifths being individuals. Declining activity
It
Add to these items, the individual
income
iaVorable repercussions at a later
filed
c
bank
■
on0,fnnygar-'ThiS'5eKnt-that?b0Ut
.90,000 persons and business firms
inherent
holdings,
WOuld fall and credit losses would
.
.
«<>». - of this writing, somewhat
first
the
For
and
.
,
.
.
upward
haStfS
area.
inKO
montbs ot 1958. bank loans be greater, As banks become more to community. It is obvious that
declined by over $2 billion. This liquid^ they would be more easily bank management must be taidecline in the demand for loans, tempted into the long-term invest- lored to the individual situation,
percentage and has, in fact, been.'
ment
.
slx
driving
trom
from
of
OI
.
v
Gross National Product, another
measure of economic welfare, fell
decline
aeenne
money
capital markets.' During the first
Herbert Perry & Co., inc.
70 Wall Street, New
York 5, New York
16
The Commercial and Financial Chronicle
(716)
.
.
.
Thursday, August 21, 1958
for
the half year despite a
.light,, overall sales decline.
i'he
THE MARKET... AND YOU
By WALLACE
June
When to
the
bright one. Net income nearly
i o u b 1 e d from $625,000 to
>1,114,000 for the three
STREETE
quarter
was
sisted
in
this
week's
per¬
stock
market for the
quality issues,
while the low-priced issues
featured on high volume and
fair gains at times. Volume
contracted to around
month1 low,
neither
a
three-
sinking
spells nor rally attempts
achieving any great signifi¬
interest.
"
V
..
*
With the
end
was
utilities and
only
a
easiness
m
tne
ods of market pressure.
v,: Stores stocks
tive at
because of the lack of
cance
■
galvanized the nor¬
mally pedestrian stock which,
preferred stocks, largely due to a pared divi¬
the latter dominating the new dend rate this
year, had been
lows list rather completely.
holding well under its 1954
The rail picture was one of and 1955
highs.
much backing and filling with
Stores and Textiles Awaken
the section contributing an
Interest
occasional weakening to peri¬
sistmg
a
were
bit
ac¬
times, the general ex¬
planation being that the fall
to be the one where high upturn climaxing in the year1
end sales deluge was height¬
yields were still available but
Labor Day week¬
ening interest in soft goods
skepticism was still the order.
items while the debate raged
bit more than a A
quality line like Southern over whether the hard
The rail section; continued
week away, most
of the Street Pacific has been available at
had given up on hopes for a
a
yield of around 6% despite
renewed bull swing to any
the fact that it is the diversi¬
new peak as part of the sum¬
fied volume king of the west¬
mer
rally picture. The sum¬ ern
roads, operates in one of
mer
rally, however,/ was a the best
growth areas in the
robust one even without the
country, was first of, the car¬
concrete support of basic ele¬
riers to set up' a profitable
ments as dividend news, earn¬
pipeline operation, can show
ings reports and such. The a financial situation that
Aug. 11 peak for the indus¬ needs no
defending and
trial average of 512 was less
covered its dividend ade¬
than nine points under the
quately in the first half of the
all-time high of 1956, which
year. On the same indicated
was excellent behavior in the
dividend payout it sold higher
absence of any indication that
in 1954, 1955 and 1956 than
the economy was going to
it has recently.
snap strongly out of its reces¬
❖
:]«
sion rut.
goods
lines
were
still
in
dol¬
the
drums. These issues have not
people must want whether employed or unemployed, and to
refer to passages in the "Good Book" for timeless advice.
Retired people are counseled to buy a well located lot in a
warm climate—for protection, not for
profit.
PJease do not ask me if, after
buying land in Florida, California,
elsewhere
or
in
Southwest, you
profit if you
sell
it
or
at
a
to
build
use
Let
on
reducing taxes, or trying
other artificial gimmicks will
restore
prosperity.
But, as
soon as demand again equals sup¬
pump,
not
it
it.
me
ply, we will once more have full
employment. Hie same applies to
selling land or lots for a profit.
first
that at
time,
Our
this
whatever
buy
—
stocks,
or a
Stores
offers
even
more.
*
*
*
Like the stores, the
have
textiles
few friends
had
in
re¬
cent years
vate
er
and their own pri¬
depression has run long¬
than those in other lines.
and
bonds,
Prices and Wages
small bUs-
I
hope I
am
wrong.
On the other hand, for those
people who will be retiring on
pensions in the North, I believe
it is good protection to
own a
well-located
»•:
picking
up
impor¬
But be
lot
in
sure
a
warm
cli¬
only effect of the
tighter money moves still per-
Bounding Food Issue
Pet Milk
half aimed at commercial con¬
Among the brighter spots
tracts, is one that is expected
earnings parade is Otis
to improve results comfort¬
Elevator which
reported a
ably, despite some large start¬
thoroughly satisfactory i n up costs That were absorbed
crease in net for the first half,
last year. It also could indi¬
in part because of the re¬
cate a continuation of the im¬
bound in building construc¬
provement at perhaps an ac¬
tion and also a result of the
something of
gain
circle, bounding ahead easily
when the company reported
thoroughly satisfactory i n creases in
earnings both for company's
a
was
newcomer
the June
to the wide
quarter and for the
The company has
half year.
Advertising
is
on#
of
the most useful tools in
securing
So
it's
your
new
smart
customers.
to
place
advertisement in
THE COMMERCIAL. AND
FINANCIAL CHRONICLE
15 Park Plaee, New Yerk
7
an
method for bringing
for
increase in demand
gopds is to lower prices. Accord¬
ing to the newspaper advertise¬
ments of today, it appears that
retailers are now really cutting
prices and that there are true bar¬
gains.
These, however, vary in
different localities. Customers
should "shop" and see for them¬
selves. President Eisenhower ad¬
vises everyone to buy more;
he
does
not
say
"where"
or
He leaves that for you to
"when."
find
but
out.
thing. Therefore, we should rec¬
ognize the reality of the business
cycle and time our moves accord¬
ingly. We must now bring busi¬
ness
and employment into bal¬
This, of course, means that
prices decline, labor should be
willing to accept lower wages.
Restoring prosperity is no "one¬
way" street.
ance.
as
Stocks to
Best
The law of
Own
supply and demand
applies equally to land, commod¬
ities, and labor. The wageworker
must be, w i 11 i 11 g "to -take less
money
for a few
builder and the
home
the
and
months
retailer
must be
equally ready to reduce
prices.
If wageworkers do not
freely accept lower wages,
they must suffer from partial un¬
employment.
There is no half¬
way solution.
Neither the Pres¬
now
ident of the United States nor the
powerful labor
long run, upset
supply and de¬
mand. I urge readers to turn again
to Ecclesiastes, the third chapter.
president of any
union can, in the
the basic law of
celerated rate in the current
"How can the wageworker buy
success in selling
fiscal year that began this
its maintenance services and
goods if he is unemployed?" you
month. Rohr's dividend policy
ask, I reply that he can do so
end the dependence on new
i s
cash-plus-stock which with his unemployment insurance
installations. Earnings projec¬
makes
it
something of an and, if necessary* by withdrawing
tions for this year give the
some of the savings which he has
an odd
leverage factor in its
practice of taking all the milk
supplies offered despite its company a chance at covering
the $2 current dividend per¬
production needs. While this
provides a stable source of haps twice over, which auto¬
supplies, at times the com¬ matically makes the company
a dividend increase candidate
pany has to dispose of the
to lard the present return that
excess even if it entails a loss.
comes close to 334%.
By curtailing these losses
sharply so far ,this year
through a better balance be¬
tween receipts and needs, as
well as through better
profit
margins and improved sales
volume for some of its prod¬
ucts, the company was able
to show a boost from $1.79 to
$2.52 in its per share earnings
about
to buy
in the
"About the
The usual
this as
Forgive me for so often re¬
you
would buy life insurance— ferring to the "Good Book"—but
for protection, not for profit. And
remember
that
the
Bible
has
make sure you see the land before
gradually been built up on the ex¬
you buy it.
periences of the ages—some 3,500
years.
If you will turn to the
Supply and Demand
third chapter of Ecclesiastes in
My reason for not now "buying your Bible, you will find it says
for profit" is because we have no that there is a time for every¬
mate.
j<;
signs of
tantly.
~
»*:
property ultimately de-/
is, upon what he wants.
land,
Sopac's diversity is rather A
firming of mill prices above
outstanding, ranging from the the
April lows has heightened
Steels had a bit of help refrigerated produce car fleet
interest in textile issues, al¬
from the operating rate in the of Pacific Fruit Express, larg¬
though there was still plenty
industry which was put at its est such collection of cars of caution around because control over the market when we
wish to sell. When we buy any¬
best level since last December under one
wing, which is half
cyclical rebounds have been thing, today we are "sitting in the
and made it seven weeks in a owned
driver's seat,"—but this is not so
by Southern Pacific, to
anticipated in this field before
row of increasing operations. its
trucking subsidiaries that to no avail. Nevertheless, when we sell. The price which
we get when we sell will depend
The shares in this group were
operate regular service. It is
Burlington and Lowenstein not upon the real value of the
logically among the better- also surveying its some 4,000,among the low priced items property, but upon how many
adting items around. The oils 000 acres of land for mineral
other people want to sell similar
available are in the 5 % return
Were definitely laggard and
potentials. Because its income bracket on current dividend property at the same time. This
we cannot control.
aircrafts neglected. Chemicals from outside interests is run¬
rates. Their prices are also
This explains a basic trouble'
had an erratic time of it,
ning close to what is required well deflated from historic with business
today. The supply
showings hit,more ability to for the fixed interest require¬
peaks, with Lowenstein off
sag in unison when the going ments,
Southern Pacific is around
50% from its 1955
was rough : than to snap back also
something of a candidate
able
production stages are
high and Burlington almost as
together in periods when for dividend liberality as soon
still
ahead.
Rohr Aircraft,
harshly handled.
prices were generally working as railroad traffic shows any
with its backlog more than
•
own
pends upon the other fellow—that
you
—
Better-Acting Steels
higher.
of both goods and labor, at the
present time, exceeds-the demand.
This especially applies to the au¬
tomobile industry.
Priming the
any
don't want
or
say
can
South
decide
later
you
the
participated to any great ex¬ i n e ss
you
tent in previous market run¬ should
buy for
cash. This, in
ups
and consequently offer
the more generous yields, my humble
Roger W. Babson
opinion, is not
running from 5 to above yet the time to
6 V2 %. The famous-name borrow
order to buy
money in
Macy and Gimbel issues are anything for a "quick turn" or
in the 5% to 6% area while profit. However, I may be wrong
Allied
BABSON
In giving the advice to buy for cash at this time land, stocks,
bonds, or a small business, Mr. Babson is able to explain the
workings of the free market, expound on the desirability of
owning stocks in those companies that supply goods which
months. It
Reactionary tendencies
Bay and What
ROGER W.
By
oddity in that it has 514%
convertible
debentures
out¬
standing that give a better
yield than that available on
the common stock currently
at
around
the
conversion
level. Other aircrafts,
because
been
"storing
for
up
a
rainy day."
This gives a hint to investors as
to the best type of stocks to own,
"Own stocks of companies
viz.
that
supply
goods which
people
must buy, whether they are
ployed
or
em¬
unemployed;"
largely
they have been well
Aircraft Items
depressed, offer satisfactory
Aircrafts
are
among
the yields well into the 4%
largely neglected items bracket, including Lockheed
and Martin which showed a
around.
They were chilled
first by the plane stretchouts, return of above 412% at re¬
then by the switch in empha¬ cent levels.
sis to rocketry and the fact
[The views expressed in this
that this is still mostly fixed- article do not necessarily at any
time coincide with those of the
fee development work at the
"Chronicle" They are presented
moment and the more profit- as those
of the author only.]
With Schirmer, Atherton
(Special to The Financial Chronicle)
PORTLAND,
Boynton
is
Atherton &
Me. —Stanley
now
C.
with .Schirmer,
Co., 634 Congress St.
J. F. Jordan & Co. Adds
(Special to The Financial Chronicle)
BOSTON, Mass.
—
Edward A.
Shaw has been added to the
of
J. F. Jordan &
Street.
staff
Co., 131 State
Volume 188
Number 5770
...
The Commercial and Financial Chronicle
(717)
that
and
of
17
Governor Harriman.
Rockefeller served underTrumah
v
From
Mr. Montague's paper? on antitrust law have appeared in the
Chronicle for about 30 years. Here, of interest to economists,
notwithstanding the
illegality" doctrine, "the generality
of the language of the Sherman Act makes it impossible for
us to
interpret or enforce the Sherman Act unless we apply
and use the Rule of Reason, or reasoning that is in the style
lip-service paid to "per
,
In
Standard
Tobacco1
Court
se
of the Rule of Reason."
,
Oil
and
1911
in
the
that
showed
Reason
is
really
using
sound judg-
American
.
the
only
Supreme
Rule
applying
and
ment
M
applying
antitrust
.
This
the
the
of
used
generality
language in
Act
Sherman
makes
Sherman
without
was
it
in
ap¬
Court
applied
and
Oil
of
of.
Reason
period
of
beginning
that has
technical
life-with
always sounded
uncontested
and
a
chap¬
new
in
Standard
that
Oil2
in
Milbam, Cochran Co.
New Firm Nam
successful
other officers of the firftiv
National Com¬
mittee in 1956,
he was ex¬
ministration and had gotten con¬
siderable business under it. Un¬
some
one
as
director of the
Rep ublicaii
pected to be
b ernatorial
nomination
Carlisle
of
Jbargeron
his home state
this yeat. He
deserved it. He went
with the plaudits
ringing in his ears as the best Na¬
tional Chairman the Republicans
ever had.
He undoubtedly would
be given a Cabinet post, the dopeof
out
office
said, by
no
dered
nor
matter
few
a
grateful President.
a
Cabinet post was ever ten¬
As
was
weeks
conviction
of the
defendants
was
active and will operate * its
present four offices with the fol¬
lowing personnel: Wichita-^-Glenn
doubtedly Mr. Hall figured that
L. Milburn, David F. Bradleyy Al¬
was bad enough to give them a
bert L. Brokes, David E. David¬
juicy plum;' at least they could
cough up with a campaign con¬ son, Warren B. Gillespie, Theo¬
dore A.
Hartenstein, Duane L.
tribution.
Krug, David & Wire ant* Walter
The thing was so ordinary in
R. Zittel;. Oklahoma* City
Wil¬
politics that the Democrats didn't liam
B. Cochran, John T. Harry,
even give it a fumble.
But Mr.
Phillip W. Davis, H.- Hugh McEisenhower is said to have been
Intire and J. Herman Schmoldt;
very much displeased. Which goes
Kansas City — Mason. H. Feese,
to show that he ought to try rais¬
John B. Markey, and Archie; L.
ing campaign money himself, par¬
Drake; Hutchinson—George H.
ticularly this year when Republi¬
Ewald, John
J. Knightly and
can prospects aren't easily being
Lewis C.
it
given the gu-
other honor.
fact, Within a sold.
any
of
Mr.
Hall's
had
name
Taylor.
Thus it
came
about that instead
dropped from public view.
In¬ of
getting any help from the Ad¬
with Trenton Potteries26
quiries to what had happened to ministration in his New York as¬
the "per se illegality"
the former Chairman were met by
doctrine made its earliest chal¬
pirations, unusual steps were taken
a
shush, shush, that man's name to head him off. If no one with
lenge in the Supreme Court to
isn't brought up around here anythe Rule of Reason.
responsibility had put the bug
more.
^
in Nelson Rockefeller's ear it is
On the questions that came to
the
:
trouble.
They testified for
Milburn, Cochran & Company
thing that Mr. Hall wanted a
will continue
to engage in
all
campaign contribution as a pre¬
phases of the securities business in
requisite to their getting it. They
had been close to the Truman Ad¬ which the predecessor company
campaign
ter began
in which
legalistic, the Rule
of Reason might have fared better
if it had begun with a name which
emphasized that it was as simple,
and necessary, and routine, in the the
Supreme Court in 1927 in
business of interpreting and ap¬ Trenton Potteries there were two
plying the antitrust law as breath¬ grounds on which the Supreme
ing is in the business of living. Court could have reversed the Cir¬
Indeed the Supreme Court re¬ cuit
Court of Appeals and affirmed
marked
responsible
positions.
^
his
But
of ascendancy of the Rule of Reason
Rule
Harrimaivdid the
more
Hall, former Republican pressed any doubt about it. It had
a reassuring effect which counted
WICHITA, K a n s.—Announce¬
heavily in the effort to raise funds. ment is made ' of the change of
York gubernatorial race, is an ex¬ What was it that came between name of The Small-Milburn Com¬
pany,
them?
Incorporatedy 121
North
ample of the
There was the incident of a Market Street, to Milburn, Coch¬
ingratitude of
m
nickel project in Cuba. It came ran & Company, Inc. Interests of
politics. He
wanted to be
out in a Congressional investiga¬ Amos C. Small, Don M. Small,
governor very
tion that the firm which got the Duane T. Smith and? Wesley L.
contract to build the plant had Keating have -been purchased by
badly.
After
sters
Challenged
in 1927
The
the
using
of
a«
Standard
in
closed in 1927 when
name
and
the Rule of Reason
Gilbert H. Montague
Reason.2
Instead
law 28
so
1911
heard
Rule
Act
a
antitrust
is
Supreme
ever
enforce the
and
exempting
and American Tobacco, years be¬
fore the term "per se illegal" was
it
impossible to
interpret and
plying
the
practice
for
unlawfulness.
law, and that
the
ground
egregious and
unconscionable and "per se ille¬
gal" that the Rule of Reason can be
dispensed with in adjudicating its
interpreting
the
from
no
in
practice is "reason¬
a
able" by. some non-legal or busi¬
ness
standard is never in itself
it
and
and
Because
sufficient
common sense
reasoning
"nature of the parties,"22 and the
"character of the parties."24
of
in
National Chairman, who withdrew
earlier in the week from the New
He concludes that
cases.
but
Leonard
and later fell into disfavor, but How is proving inescap¬
able in antitrust
same
By CARLISLE BARGERON
business heads and lawyers, he traces how the Rule of Reason
arose,
and Roosevelt.
Washington
Ahead of the News
GILBERT H. MONTAGUE
By
Counselor at Law, New York City
Clark, Dodge & Co. to
Admit E. M. Geddes
Clark, Dodge & Co., 61 Wall
Street, New York City,, members
of the New York Stock Exchange
Every now and then somebody doubtful he would have thought of
on Sept. 1 will admit
Eugene M.
would seek to explain that Mr. running. This someone didn't like
Geddes, Jr. to partnership.
Eisenhower didn't have any Cabi¬ the idea it would be Mr. Hall.
net positions open.
This is true,
Oh, by the way there was one
but
there
are
hundreds
of
little
time Mr.
Eisenhower
could have
Syndications Clearance
be done something to help Mr. Hall.
Syndications Clearance, Inc. has
Associa- without going outside the Rule of appointed to do to give him a He
appointed a delegation to go been formed with offices at 40 Ex¬
lion4 in 1897 and in Joint Traffic
Reason, if the Supreme Court had buildup. But about Len Hall there to Israel. As a New York politi¬
Association5 in 1898 the Court had
change Place, New York City, to
applied and used the Rule as it was a conspiracy of silence.
cian, this would have been excel¬
engage in a securities business.
applied and used the Rule of Rea¬ did in Standard Oil and American
lent for Mr. Hall. Around Wash¬
What went wrong between Mr.
son in the very decisions in which
Tobacco in 1911.
Eisenhower and Mr. Hall to break ington at the time there was con¬
the Court wa& denying the Rule's
But instead of deciding the case
Sidney Tager Opens
siderable eyebrow lifting that Mr.
existence!
on
these grounds, the Supreme up a beautiful friendship? It was Hall was not named.
Sidney Tager is engaging in a
Mr. Hall who, when Mr. Eisen¬
As applied and used in Standard Court's
opinion written by Justice
As to whether Mr. Rockefeller securities business from offices at
hower was stricken with a heart
Oil
and American Tobacco
the Stone took
quite a different
60 East 42 Street, New York City,
Rule of Reason was "universal in
attack, immediately calmed the will make a better candidate, I do
course,2? so that after the Supreme
under the firm nam# of Tager &
its application" to all Sherman Court decided Trenton Potteries panicky politicians with word that not know. There is little differ¬
he would run again. He never ex¬ ence between his political thinking Company.
Act cases 6
in 1927 in a 5 to 3 decision, it was
Every act, agreement, transac¬ promptly and widely stated and
tion, or practice had to be tested believed that the Supreme Court
by the Rule of Reason before it in Trenton Potteries had decided
could be adjudged to be in viola¬ that all
price-fixing agreements
tion of the Sherman Act?
This announcement is neither an offer to sell nor a solicitation of an offer to buy any of
are "per se illegal" because pricethese Shares. The offer is made only by the Prospectus.
fixing agreements eliminate price
Trans-Missouri
Presidential
errands
one
can
Freight
Rule of Reason Test
This
test'comprised First, ana¬
lyzing by the Rule cf Reason the
text and the historical background
of the Sherman
Act and the Su¬
competition, and that the Rule of
Reason as applied and used by
the
Supreme
Oil
and
Court
American
in Standard
Tobacco
EXCHANGE OFFER
is
inapplicable to price-fixing agree¬
ments.
Court decisions containing
currently authoritative inter¬
This is the present day doctrine
pretation of the Act, so as to of "per se illegality," as the Su¬
ascertain what the Act forbids,
preme Court finally accepted and
and
what it permits.8
Second, expounded it when the Court first
weighing by the Rule of Reason used the term "illegal per se" and
preme
to
the
all the available facts relevant to
established
the conduct that is being
the holders
of Capital Stock of
HUMBLE OIL & REFINING COMPANY
cony-Vacuum 28 in 1940.
so as
to ascertain
reviewed,
the over-all pur¬
and effect of that conduct,9
Third, combining the results
and Second, so as
to
adjudge thereby whether the
Sherman Act forbids or permits
pose
and
First
of
that conduct.1^
that
doctrine
in
So-
Trenton Potteries illustrates how
great
may
when
one
Justice Brandeis did not partici¬
Court in Standard Oil and Ameri¬
pate in considering and deciding
treated
as
relevant
the
following evidence regarding
the
practices comprised in the
conduct charged to be a violation
of the Sherman Act, viz. their
"nature,"11 their "character,"12
their "intent*?12 their "purpose,"14
their
"conception,"18 their "ob¬
ject,"16 their "terms,"1? their "cir¬
cumstances,"18 their "operation,"18
their
"effect,"20
quence,"21 their
*From
before
of
be
the
American
Antitrust
ington,
D.
fetind
address
an
"conse¬
the
by
Mr. Montague
Bar Assn. Section
Law
C.
in
their
"result,"22
Spring Session, Wash¬
The complete paper may
the
A.
B.
A.
Section
ceeding a.
(Incorporated in New Jersey)
Standard Oil Company is offering shares of its
case.
Subject, to all these standards
limitations* the Supreme
Tobacco
Trenton Potteries
because
daughter Susan had been
cial
by
-
STANDARD OIL COMPANY
the consequences
the Justices of the
be
of
Supreme Court is prevented from
participating in the consideration
and decision of a Supreme Court
and
can
■
Assistant
torney in the
Potteries
was
United
case
a
States
his
Spe¬
At¬
when Trenton
in the Circuit Court
of Appeals.
With
Justice
Brandeis'
strong
views in Chicago Board of Trade
regarding the Rule of Reason, and
emphatic
of
the
approval
his
of. the Prospectus and the
Exchange Form may be obtained from THE CORPORATION TRUST COMPANY,
15 Exchange Place, Jersey City 2, New Jersey; FIRST CITY NATIONAL BANK
OF HOUSTON, 921 Main Street, Houston 1, Texas; MORGAN STANLEY & CO.,
2 Wall Street, New York 5, New York; ROT AN, MOSLE & CO., Bank of the South¬
west Buildjng, Houston 2, Texas; ROWLES, WINSTON & CO., Bank of the Southwest
Building, Houston 2, Texas and UNDERWOOD, NEUHAUS & CO., INCORPO¬
RATED, Houston Club Building, Houston 2, Texas.
STANDARD OIL COMPANY,
(Incorporated in New Jersey)
conditions could be considered to
the extent that they were relevant
the
the
violations charged and to
antitrust law as then inter-
Pro¬
Continued
on
page
26
OCTOBER 14, 1958, are
Company. The terms of the exchange offer, which expires
set forth in a Prospectus dated August 19, 1958.
Copies
Rule's insistence that in all anti¬
trust cases all circumstances and
to
Capital Stock in exchange for shares of
Capital Stock of Humble Oil & Refining Company in the ratio of 1% shares of Capital
Stock of Standard Oil Company for each share of Capital Stock of Humble Oil & Refining
Eugene Holman,
New
York, N. Y., August 20,1958.
,
Chairman of the Board.
18
The Commercial and Financial Chronicle
(718)
Effect of Britisli Bank Rate
Upon
Steeling and the Economy
By PAUL EINZIG
/
.
on
to
of the
Bank
rate
re¬
in
was
accordance with general anticipa¬
three previous
Oh the
tions.
casions
the
of
oc¬
Eng¬
Bank
the
sterling artificially by attract¬
arbitrage funds to London.
funds is
always
dubious device,
a
ductions when
yet century-old practice has made
this
is
use- highly
respectable.
Evi¬
dently the British authorities now
not
was
expected,
i
n
the
the
Di.
Paul
Cin2ig
increase
Bank rate in September
the
present
occasion,
of
the
1957. On
however,
the authorities must have arrived
at
conclusion that they are
justified in managing the
country's monetary policy from
the point of view of preventing a
Hew
speculators
from
making
profit. So it is to be assumed that
in future Bank rate changes will
the
not
be
made whenever
the
Treasury
end the Bank of. England think
they ought to be made, regardless
as
to
whether the changes
are
widely anticipated or not.
-
of
Rate
Reduction's
>
.
Unusualness
The
lowering of the Bank rate
towards the middle of August is
,
unusual.
most
of
Living Decline
the
of
causes
the
production is running at 5% be¬
low its last year's level it is indeed
difficult to justify an increased
distribution of
the
That
markets
ing
purchas¬
of wage in¬
by means
power
Although such consider¬
not likely to moderate
wage demands, they are liable to
influence the awards by arbitra¬
creases.
ations
tion
are
tribunals.
Of
course,
Bank
other
•
Although
reduction
or
4*/2%
decided
it, shows the degree of con¬
in sterling.
Apart from
fidence
considerations
of
seasonal
sure, evidence of
of interest
rates
in
the
normal
stances be sufficient to
a
reduction
Britain at
of
the
this
pres¬
rising trend
a
in
United
circum¬
discourage
Bank
of
time
in
rate
the
at
>
the
fur¬
a
end
to
transfers
of
in September would be
it is not
the Government's inten¬
tion
revert
to
to
cheap
money
take
invested
advantage
rates.
tion
Such
funds
to
high
riod
to
to
interest
commercial
de¬
dollars, tend to weaken
sterling. Yet the British authori¬
ties, so far from trying to coun¬
the
actually ac¬
by lowering the Bank
pressure,
centuated it
level
tends
is
serious
to
spite of this, the first
reac¬
tion
was a
strengthening of ster¬
ling in relation to both the dollar
and
is
fall.
to
The
to
continental
true,
lived.
currencies.
the firmness
Even
so.
on
was
It
short¬
balance
ster¬
ling remained higher than it
was
before the reduction of the Bank
rate, which is
an
unusual experi¬
con¬
slight
a
a
recession, and is prepared
relax, credit, even
of
avoid
revival
at
of
the
risk
inflation.
Business Upturn Sentiment
Stock
Exchange,
investors
and
speculators do not share the Gove r n m e n
t's
about
business outlook in the
the
declared
pessimism
does
show
how important
the psychological factor is on the
foreign exchange market. Because
the; unseasonal reduction of the
Bank rate is interpreted as an in¬
dication that the British authori¬
ties' have full confidence in
inherent strength of sterling,
the
the
psychological effect of the change
lias entirely offset its material
Vice-President
N.
in
made in
rate
to
7%.
on
article
corrected
market
assumes
reflationary
that
that
measu r.e s
would not only prevent a further
fall
in
industrial
activity
but
banks
bring about
even
revival.
a
Moreover, inflationary expecta¬
tions
in
the
United
States
affect
British
ably.
business prospects favor¬
The slight relapse in com¬
modities is viewed
as
a
temporary
phenomenon
in
the
an
increased Amer¬
ican
industrial
materials.
In
light
demand
Britain,
of
for
too,
the
Connolly,
fol¬
Trust
to decline, which
election
as
of
Richard
the
Directors
of payments.
trial
of
the
A revival of indus¬
expansion
is
bound
to
be
the
on
of
Federal
Paul
Stillman,
Allied
of
Mr.
Perkins
Chemical
will
It
first
working
a
be
its
of
cash
a
type
the
merger,
in
New
Jersey,
with stockholders of Federal Trust
paid $51
Vice-Chairman
is
represent
share.
a
Federal
There
162^
are
standing.
underwriting syndi¬
took place at
the offices of the Signature Co.,
25
South
William
Street,
New
York City.
;
The ceremony
trustee
also
for
had
the
to
two
bond
his
sign
Anderson
most
'
declared
elected
the
issues
financing
Anchorage
put
were
tral
Trust
Sullivan,
Edward
elected
New
the
A.
York
and
the Eastern
New
Seaboard, it
by Mr. Goldsmith,
northwestern
interest
states
might
pected
as
New
Mr.
headquarters
office
where
naturally
because
William
elected
Horace
Dock
territory.
New York
Street
present, however, it has only
pier, operated by the Army. '
;f
%
office at
of
and
Leonard
First
Aug. 25. %
National
bonds,
E.
North
derson
in
were
$6,200,000
.
America,
the
Stockholders
North
'
!
the
of
'
America
and
By
"
■
of
Commercial
gusta
'
from
effective
approval
on
July
the institutions.
The
as
banks would
be
known
000,000 and
the
par
taneous
Terminal
and
value $10.)
Obligation
Port
if
if
Trust
s
of
elected
from
stock
capital
was
San
$600,000
to
a
National
have
merger
Bank
of
and
Torrington,
Conn., into the Hartford National
and
ford,
Revenue
Trust
Conn.
Company,
The proposal
Hart¬
is sub¬
ject to the approval of the stock¬
General
dent
New
D.
W.
R.
and
Cashier.
The
if
by the
N.
nounces
^
Ji,
State
Board
that
monthly
reached
-
of
in
meeting
-
to
if
Newark.
Directors
the
regular
agreement
recommend
an¬
to
was
the
Grants,
to
open
Dunaway
M.
is
has
a
a
Presi¬
Gunderson
bank
if
Colo.,
Bank,
the
of
is
capital
surplus of $300,-
000.
The
National
Bank
Mexico,
of $200,000 and a
Currency.
issued
if
granted by the
the Currency to
of
National
Grants,
bank.
%
was
Comptroller
First
holders and the Controller of the
Improvement
value $10).
Approval
banks
for
Company,
Bank
par
if
s
both
plans
Torrington
of
City of Anchorage carry
rates ranging from 4 to
5.40%, depending on maturity, of
tax-exempt interest.
the
Angelo National Bank of San An-
Co., Boston, Mass.
*
M.I An¬
of bonds
if
shares,
Trust
i
types
if
dividend,
stock
a
$700,000, effective July 25; (Num¬
ber of shares outstanding—70,000
land
Bonds.
two
By
bury, Jr., Treasurer of New Eng¬
$6,200,000 of Port
Facilities
of
(Number
Vice-President and John W. Pills-
Directors
$2,000,000'
Na¬
in¬
gelo, Texas increased its common
if
Norman C. Hoffman
and
issues:
offices throughout
12
6.
Aug.
if
$150,-
the city,
trustee
amounts
over
Southern
$200,000 to $400,000
shares outstanding—40,000 shares,
the Commercial Bank of North
America, with assets of
*
capital stock of The Au¬
New York voted
to merge
the
.
new
Citizens and
creased
22
-
.
tional Bank, Augusta, Ga., was
State Bank and Trust Company of
as
stock,
if
sale of
the
the
July 31.
if
if
at
effective
Company,
common
Bank
*
Trust
under the title Old Kent Bank and
New
institution's
conditioned.
A. Brown,
given
Com¬
and
,
$2,000,000, repre¬
senting the proceeds of two simul¬
The
Michigan
\yas
Kent
Old
the charter of the latter bank and
re¬
■
air
approved
checks
$1,050,000,
Grand Rapids, Mieh., under
close of business
Baker, Vice-President.
two
-•
Bank
if
where
Hanauer,
Bank,
were
1
and into
of
assistant trust officer, and Morton
The
with
merged
quarters have been expanded and
Haupt's revenue bond de¬
partment. Representing the Seat¬
the
en¬
if
of
stock
common
100 Church
Trust
Ira
tle
the
Rapids, Grand Rapids, Mich., with
••
Attorney;
in
Peoples National Bank of Grand
Commerce,
the opening
announces
combined
-A
:!s
York,
25%.
as
comparable positions
larged bank. r
J
Bank
freight for Anchorage
brought in by rail from
southerly.ports or lightered
by
barge.
Development' of
the
city into a seaport is expected to
much
,
Dry
•
^
of
Trust's
will
join the
and that
present officers and the staff of
Federal
Trust
will
continue
in
furbishing program has been com¬
pleted at the main office of the
now'
by
Federal
of
Directors
of
repre¬
pany,
more
costs
of
#
Bank
new
on
post.
new
a
some
Board of National State,
if
#
if
one
transportation
Board
v
■
An extensive alteration and
At
populated
Board of Direc¬
contemplated
sentatives
elected
was
Trustees
port facilities in
the
been
Savings Bank, during their
of their
into
has
:J:
>,
of
Industrial
ex¬
of
cut
£
Sawyer,
Board
great
business
heart
Alaska's
V,.
*
A.
❖
Anchorage. The city is located on
protected deep-water inlet that
well
Grange
is
Aug. 19 meeting.
a
thrusts
the
to
on
Proceeds of the bond issues will
used to build
It
J.
; >
'
\
.
of the
if
Director of the Federa¬
a
of
:
%
Connolly, President of
Trust, will become Vice-
Chairman
tion Bank and Trust Co., N. Y.%
ties with Alaska.
be
New
tors of National State
if
from
be
close
of
in
close
the
at
Friday, Oct. 10.
Federal
the
at
,
David J.
will
McQuade
the .bank
of
effective
business
York.
noted
as
effective
York,
of
become
the
his
from
was
well
of
Vice-President
head
showed
England
it will be the largest
banking interests in
New Jersey history. The plan will
be
submitted
for
approval
at
stockholders'
meetings
of
both
banks
Oct.
7, and would then
Currency,
been
President.
two
bonds
has
McQuade
make
new
interest
strong
the
of
Sept. 2, it was announced Aug. 15
by Joseph Pulvermacher, Sterling
Alaska, by a nationwide
syndicate of 28 underwriters ted
by Ira Haupt & Co.
for
When effected, subject to
the
approval of the Comptroller of the
according to John
Chairman
Sterling National Bank and Trust
hood for
Orders
state,
and
among
the
top
eighty banks in size in the nation.
Cen¬
merger
weeks after Congress voted state¬
especially
the
Board.
bonds.
July,
in
market
of
out¬
size, the largest national bank in
the
Marine
Company
shares
sorbed into National State, putting
National State near $400,000,000 in
been
on
of the
Trust
Federal
Trust's
$80,000,000 in
deposits, and earnings, will be ab¬
Bank
has
Scott
New York,
T.
he
the
on
City
membership
Directors
Midland
pleased by the enthusi¬
up
and
*
-
B.
to
Board of
8,200
that
York,
of
*
*
,
Frederick
y
with which mainland investors
bought
The
Officer
Company,
Mr.
asm
*
.
times.
was
New
of
Farmers Trust Company, N. Y.
issues
name
Bank
Executive
of the
agers
Bonds
balance
t
in both
control.
was announced today
by Kerby H. Fisk, Chairman.
coupon
improvement
is
said Mr.
merger,
W.
stockholders
S.
member of the Board
a
City
and
largely accounts
it
favorably
meeting
agreement
a
President
and
Chairman of the Board and Chief
raw
for the low figure of imports and
and
President of National State. These
by Bertram M. Goldsmith,
partner of Ira Haupt & Co., man¬
raw-
material stocks have been allowed
in
are
250
for
would
been
,
advantages of
Corporation
Treasurer; James Fitzgerald, City
This shows
Bank
that
had
Aug. 20.
of the Board of The First National
the
the
Trust Stated
indicated that it will be
reference
page
The
The
Participating in the ceremonies
closing the financing were also
Ben
Boeke,
Anchorage
Clerk-
of
Federal
Mayor Anton An¬
to
over
the Govern¬
time of the increase
Newark,
Presir
Connolly,
acted upon at their Board
'
autumn../Equities have risen to
the level where they stood at the
of
J.
Fed¬
with
merger
Company,
David
proposed merger
informally considered
the Aug.
509 in
was
on
Perkins
of
J:
the
will be used
money
Anchorage, Alaska's
fastest-growing city,
a
Trust
dent
lows:
$8,200,000, which was raised
by
selling
bonds
to
investors
throughout the United States, was
is
Judging by the firmness of the
eral
The major stockholders
error
York.
bank¬
Civilian
,
stockholders
ap¬
First National City Bank, New
to
major seaport.
a
Bank
the
Division.
issue
7
The
pe¬
possibility of
ence.
This
3%%,
Govern¬
anxious to
very
ment's
rate.
In
at
even
sterling is not subject
attack and when the price
mand for
teract
or
when
an
ment
tem-
transactions, in addi¬
seasonal
4%,
year.
in - -London
of
at
sidered unduly low during a
,,
poiarily
of
extremely unusual, it could not be
ruled out altogether. Even though
Higher rates in New York tend to
lead
the
abnormally high, if
with
Bank
rates
in
countries.
August
at
even
.
is
rate
compared
-\
•
the Bank rate would not be
the 'authorities
would
into
consumer
policy,
States
ap-
Since industrial
claimed to have.
and
that
develop
largest and
City
announced
Assistant
An
partner
a
National
York
formerly had been
associated with the bank in Japan.
.
expected the authorities to do it,
to do
to
by
investment
First
New
as
two
ther
Bank
Alaska,
Bankers
and
the Far East Ijistrict of its Over¬
of
mayor
•
pointment of James Reed Hummer
$8,200,000
the
<
'A
Mr. Hummer
regarding sterling is that
months running the cost
Mayor Anderson and other
of living index showed a decline. Anchorage officials spent the en¬
Last month it was only 2% above tire morning affixing their signa¬
its figure of 12 months ago. This tures to some 8,200 separate bond
should go some way towards de¬ certificates
to
be
given in ex¬
priving wage demands of such change for the money. An official
moral
justification as they are of the bank! that is acting as
for
the
about
.
,
timism
profit. This was a reaction to the
judicial inquiry that followed the
allegations of leakage of informa¬
tion.
*
Cost
quick
a
leave
would
One
tunities to
totaling
to
York
ing firm. The
cate.
oppor-
make
of
OFFICERS, ETC.
The
of
derson
Withdrawal
a
pressure.
an¬
ticipation of
the change
provideds p eculators
with
New
a
sterling suffi¬
ciently strong to face the autumn
ground
that
Anchorage,
in
turned
that
funds
o n
checks
handed
were
such
feel
order to avoid
criticisms
Two
reduction
rate
a
as
BRANCHES
CAPITALIZATIONS
Complete Financing i
The attraction of such short-term
re¬
NEW
REVISED
seas
gesture to show
that
the
authorities
no
longer
consider it necessary to bolster
ing
land sought to
make
Bank
The
regarded
up
CONSOLIDATIONS
NEW
For Alaska Port
effect.
is
News About Banks
pro¬
ducers, and their recovery would,
in turn, help British exports.
pessimism.
LONDON, Eng.—The latest
duction
Commonwealth
help, the
countries and other primary
of op¬
timism the ups and downs of the
international
political
situation
have only a secondary effect on
sterling and on the Stock Ex¬
change. The foundations of this
optimism are not very firm, how¬
ever. A major strike
or a major
wage increase might easily result
in a new wave of pessimism.
-
sterling's firmness despite the recent, and
widely anticipated, unseasonable Bank rate reduction, Dr.
Einzig sees in this an expression of official confidence in ster¬
ling's inherent strength and recognition that sterling need not
be bolstered up artificially to attract arbitrage funds to London.
The writer does not rule out possible further Bank rate reduc¬
tion at end of August or in September and believes Government
is prepared to avoid recession by willingly relaxing credit at
risk of slight revival of inflation. Contends major strike or
wage increase may reduce current wave of business optimism
Commenting
Thursday, August 21, 1958
.
.
accompanied by an increased de¬
mand for imported materials. This
woulds
Amidst this" atmosphere
,
.
of
if
National
with
$50,000,
if
Bank
common
went
of
YVray,
capital stock
into
voluntary
liquidation, effective Aug. 2.
Liquidating agents or committee:
Messrs. W. T. Diss and David M.
Grigsby,
care
of
the
liquidating
Volume 188
Number 5770
.
.
The Commercial and Financial Chronicle
.
bank.
Absorbed by: The First Na¬
tional
Bank
ji
of
*
*
Aapm
jv The 'First National
Bank
IWray,
its
Colo,
Ranlrarc Affor llnnctnn shares Of common stock and 575,- markets of approximately 282,000
0ailli6l9
Wray, Colo.
-*
,
increased
(719)
VII6I
Rftk*
.
2. QIaaL
UOipi llClISi
of
HUMOIMH
mcf, designed for expansion with
bcr
of
shares
shares,
.j
,
com-
m
v
outstanding—1.250
value
oar
*
.
r
^orp^and
o
o
-
t-
,
,
f
,
Assistant
Vice-President
of
underwriting group headed
jointly by Blyth & Co., Inc., Leh¬
The
Brothers,
man
Bank of California* N. A., accord¬
ing to
an
Scharff
announcement by Chair¬
man
be
Each
Elliott McAllister. Mr. Schutt
will
attached to-the
loan
consists
and
five
^
appointment, he had
Commerce
of
of
of
$100
of
de-
com-
price
per
unit is
$150.
The
been associated with the National
Bank
and
\
shares
$10
Seattle,
Wash., since 1986.
its
x
is also selling at
company
per
share,
present
through
rights
shareholders,
.
^^
^
ar0und $41,000,000.
pipeline system is in operation.
The Houston Corporation, which
was incorporated in March 1957,
°wh"s all of the stock of Coastal
Transmission
Corporation
a n d
Gulf
Houston Texas Gas
a
Coast
producing
areas
of
Texas and Louisiana to markets poration.
Coastal
Peninsular
and
and
Oil
Cor-
Houston
to
818,333
Florida, the last
population area in the
Texas have, been authorized by
the Federal Power Commission to
service.
construct and operate the pipeline
major
The initial pipeline
tern will have
livery
a
daily
capacity
average
sys-
de-
the ' Florida
to
u-
facilities.
The
.
Houston
,
,
Corpora-
tion has contracted to acquire at
With Old Colony
CSpecial to The Financial Chronicle)
NORTH
READING, Mass.—
Benard, John A. Gregoria,
Edward L. Hare, Lewis H. Millett,
Lloyd
D.
Nelson and
Kendall
Denis
Stearns
staff
of
have
been
added
Old
Poliacchi & Co.
In
ant-
Manager
Office.
He
ager of the
fice in
of
was
the Vancouver;
serving as Man¬
Longview, Wash., Of-_
1954 when he became As-,
sistant
Vice-President,
advanced
to
Manager the next
'''
'
'
The
*
•
>
and
was?
Vice-President
First
and;
year.
*
:
:
;
:
«
National
of
Bank
Portland, Portland, Ore, changed
its
title
Bank
to
of
First
The
Oregon,
fective Aug.
National
Portland;
ef-
_
1.
.?
f
....
'
..
•
:
-
The First National Bank of An¬
chorage,
creased
from
Territory
its
$50,000
stock
of Alaska
common
in¬
capital stock
$100,000
to
by
a
dividend, effective July 29;?
(Number of shares outstanding
1,000 shares, par value $100).
—
Thomas D. Walsh With
Swift, Henke & Co.
(Special to The Financial Chronicle)
•'CHICAGO,
III.
Thomas
—
D.
Walsh has become associated with
Thomas D. Walsh
Swift Henke & Co., 135 South La
Salle Street, members of the Mid¬
Stock Exchange.
Mr. Walsh
formerly with Doyle, O'Con¬
west
was
& Co.-
nor
^
Banks for
Cooperatives
Offer Debentures
An issue of
r
month
$82,500,000 of
consolidated
seven-
collateral
trust
debentures
Aug.
19 by the 13 Banks for Co¬
offered
was
on
operatives
through
their
fiscal
agent John T. Knox, with the as¬
sistance of
security
1958
the
and
a
nationwide group of
dealers.
Dated
maturing April
debentures
are
Sept.
1,
.per
annum.
2,
1959,
being offered
at par and bear interest at
Interest
is
2.85%
All the comforts of home
payable
with the principal at maturity.
Proceeds of the sale of this issue
ot
debentures
will
be
used
A little bit of home flies with you
to
on
of
one
redeem the $49,500,000 of 5% de¬
bentures coming due Sept.
to
2, and
provide for lending operations.
These
the
secured
debentures
joint and several
are
obligations
forts
and
are
Federally
chartered
banks
pperate under the supervision
.
take
a
trip
the small but
important needs
...
so
are
graciously
many
people
and
the
task—for
during the last 23
years more
America's airliners carried
more
than 42,000.000
total of 25 billion miles. Providing the fuels
lubricants to make this possible has been a big job for
petroleum industry. Texaco is proud of its part in this
scheduled
revenue
airline miles in the United States have been flown with
Texaco Aircraft
Engine Oil than with all other brands
combined.
flying.
passengers a
of
4he Farm Credit Administration.
.
you
today's modern airliners. The friendly com¬
thoughtfully provided. No wonder
Last year.
,of the 13 Banks for Cooperatives.
These
.
when
TEXACO
PROGRESS AT YOUR
THE
TEXAS
to
the
Colony Investment'
Company
213 Main Street
All
were
formerly with Palmer
1945 he was appointed As¬
sistant Cashier and later Assist-,
;.
Gas
.
financing program designed
provide capital funds for the
construction of a 1,500-mile natural gas pipeline system from the
in
to
in
The
Francisco.
Prior to his
Co.
&
Jacksonville
of
thf. exl3ti,1®_
heated cost-of the Initial'facilities distributing systems serving
js approximately $161,166,000 Miami, Lakeland, Orlando and
United States without natural gas
stock.
mon
Allen
Jones, Inc.
unit
bentures
sec-
tion of the bank's Head Office in
San
&
stock
based on present costs, and the Winter Park. Houston will conamount of first mortgage pipeline expansion to 411,000 mcf daily vert these distribution systems to
S bonds, 5%% series due 1979.
capacity is expected to cost serve natural gas as soon, as the
by
an
John M. Schutt has been elected
:
—
choLt
(Aug. 20)t S i of units
in the form
S100).
mon
The company's pipeline sub- additional compressor facilities to Corp., which distributes manufacsidiaries,: Coastal Transmission a daily average delivery of ap-,-tured* gas in Jacksonville and is
Public offering of $36,188,000 of
Houston Texas Gas &
capital stock from $100,000 nor euKnivifnaf»f
ri1wa
Oil Corp., are selling at par to
to $125,000 by the sale of
new
in t
tftnoam!
institutional investors an aggrestock/ effective Aug. 2;; (Num-Itgate
of
$107,400,000
principal
mon
V#JL
least 80% of the outstanding com-,
*
OIUvIV
u
869 shares of class A stock.
19
SERVICE
COMPANY
20
(720)
The Commercial and Financial Chronicle
Continued from page
stitution
13
funneled
was
surance
to
in¬
an
Anti-Trust and
tional grounds. This question em¬
phasizes the importance of super¬
vision
by
the
state
insurance
department over the activities of
the private rating bureaus. A good
example of effective supervision
kind
this
of
is
decision
recent
a
by the New York Insurance De¬
partment, recognizing the right of
insurer
an
withdraw
to
file
and
to
which
rating bureau
pendent rates
from
of
made
Insurance
force
of
the
Absent
an
threat
a
to its solvency, a company has a
right to compete in the market not
only as to rates but also as to
methods
of
merchandising,
re¬
gardless
of
whether
they
are
novel or merely modifications or
extensions of existing patterns."9
State
which
Act
laws
Regulation
section
The
McCarran
the
of
anti-trust
the
makes
applicable to the business of
insurance "to the extent that such
is
business
not
is
law"
state
basis
the
for
desist
series
Federal
and
cease
by the
Commission
Trade
the
of
issued
orders
eral
regulated
by
jurisdictional
the
Fed¬
under
Commission
Trade
certain health and
companies for
alleged false and misleading ad¬
vertising. The law in this area is
Act,
against
insurance
accident
not clear since two Circuit Courts
of
Appeal
have
Commission
the
remain
must
interstate
there
that
irreducible
an
Commission
of
the
with
disagreed
claim
area
jurisdiction
activities
over
insur¬
of
companies which cannot be
ance
reached
by state law.19 The Su¬
Court heard oral argu¬
preme
ment
appeals from
on
cisions
these
de¬
April 10.
Thus, a final
answer on this problem should be
forthcoming in the near future.
on
Price-fixing
coercive
and
restraints
rating bureaus
Sherman
Fuch
are
Act
other
non¬
imposed
by
subject to the
the
to
business is not
law.
state
I
do
that
extent
regulated by
believe
not
The
question
whether
ac¬
tivities merely because a state has
legislated, if it
quately enforce
The
debates
Senate
intent
its
the
on
reflect
does
the
ade¬
not
regulations.
floor
the
of
Congressional
with
respect to the mean¬
ing to be attached to "regulation
by state law." For example, Sen¬
ator
Barkley stated:
"I
have
turbed
been
by
the
somewhat
provision
section (b) of Section 2.
ever,
I
...
approval.
.
.
.
intend
But I
to
dis¬
in
.
.
sub¬
How¬
.
vote
wish
for
be
to
understood that in
voting for ap¬
proval.
I am accepting the
interpretation placed upon it by
the conferees, namely, that if
any
State, through its legislature un¬
dertakes to go through the form
of regulation merely in order to
put insurance companies within
...
that
State
from
on
an
island
of safety
regulation,
Congressional
that effort will be futile.
A
similar
reached
by
.
11
.
conclusion
the
President
was
in
a
statement which he issued the
day
after he signed the bill:"After
the
moratorium
period,
the anti-trust laws and certain
lated
9
statutes
Opinion
tendent
York,
of
in
will
and
Insurance
the
be
Matter
of
of
re¬
applicable
Decision
of
Superin¬
State
of
New
the
Independent
Rate Filing for
Dwelling Classes by The
North America
Companies 5-6. Sept. 4.
1957.
10 American
Hospital
FTC, 243 F. 2d
V.
National
2d
883
1191
Casualty
(6th
Cir.
Cong.
719
Co.
& Life Ins. Co.
(5th Cir. 1957);
v.
FTC,
1957).
Rec.
1488
245
(1945).
they
F.
the FBI need not
tion.
administrative
should
whether
taken.
be
Some
and
these
of
bodies, such as the Veterans' Ad¬
ministration, the Federal Housing
Administration, the Federal Na¬
tional Mortgage Association, and
the Federal Reserve Board, have
cooperated in our program
di¬
rected against mortgage-insurance
tie-in practices.
complaints may
of prelimi¬
nary inquiries, full investigations
by the FBI, or by Federal Grand
these
Second,
the
become
subject
Since the Anti-trust Divi¬
Juries.
sion
lacks
fully
investigate
sufficient
funds
to
all
complaints,
selection becomes necessary. Upon
receipt of an insurance complaint,
it is quickly checked to see:
(1)
on its face, there is in¬
possible violation of the
If,
volved
a
Sherman Act.
For
example, is the
challenged conduct exempted
from
the
Sherman
Act
by the
McCarran Act?
(2)
Does
have the
tion
Is interstate
com¬
involved?
merce
the
Division
matter
already
under
investiga¬
investigated or liti¬
has it
or
gated the matter in the past?
(3) Is the matter freighted with
public import to war¬
sufficient
further
rant
the
If
tions
answers
the
rights,
the
to
study
interviews or
files,
ence
with
cluding
of
refusal to
the
tecum
tain
persons,
government
in¬
agen¬
justified. Since the South-Eastern
Underwriters case, about 30 pre¬
liminary inquiries have been con¬
ducted
by the Division in the in¬
surance
field.
Nearly
half
of
these have resulted in further full
investigations, usually by the FBI
and occasionally by Federal
grand
juries.
The scope of these prelim¬
inary and full investigations has
included almost every phase of
the
insurance field.
subjects
hazard
included
Some
are:
of
the
mortgage
insurance, automobile cas¬
insurance,
medical
mal¬
ualty
practice insurance, workmen's
compensation insurance, and .the
activities of rating bureaus and
insurance boards.
A
recent
was
'
grand jury investiga¬
tion, involving
mortgage
*
or
based
a large residential
trust deed lender,
upon
complaints made
the
Division
by responsible
representatives of insurance or¬
ganizations as well as by com¬
to
plaints received from individuals
and insurance agents.
The com¬
plaints alleged that a preponder¬
ant portion of hazard insurance
paid for by borrowers of the in12'White
478
House
1945;
15
(1950).
Law
Press
&
the
by
the
Release, Mar.
Contempt. Prob.
resulted
subpoenas
desired
in
duces
not
service
to
the
particular
investigation
institution, its af¬
insurance
and
agency
Sherman
Act is
being violated,
will
we
proceed against the offender. Be¬
reviewing
the
successful
cases filed by the Division, let me
say that of course, very few com¬
plaints reach the litigation slate.
Not only may the complained of
activity fail to constitute an of¬
fense
against
the
Sherman
Act
be incapable of proof, the il¬
legal practices may be voluntarily
or
abandoned
by the offender when
he learns of
interest.
our
cases
which have
the
by
Govern¬
insurance field
of the
passage
since
McCarran Act
been under Section 3
(b) of
the Act which provides that:
"Nothing
shall
Act
the
said
inapplicable
ment to
idate,
boycott,
act
or
to
Sherman
agree¬
any
intim¬
coerce, or
of boycott, coercion
intimidation."
or
This
rived
wording
from
conclusion
the
in
is
case
1
directly
Supreme
the
Underwriters'
authorize
>
de¬
Court's
South-Eastern
that "no states
combinations
of
insur¬
companies to coerce, intimi¬
date and boycott competitors and
ance
in
consumers
the
here
manner
alleged." is
and
tions
in
ance
and
Act
Sherman
irrespective of
state regula¬
supervision.
While the
language of Section 3 (b) requires
no
and
clarification,
a
in
Investors
Di¬
which
was
judgment
1954, is one of our most widely
publicized cases.
The complaint
charged that I.D.S., one of the
largest residential mortgage com¬
the United
had
States,
with
agreements
mortgage
loan
bor¬
illegally required
to
agree
that all
which
maintained
insurance
hazard
statement
on
the floor of the Senate by one of
the legislative managers
of the
Act is helpful. Senator
O'Mahoney
on
-
"Moreover, this proposed act
wholly undisturbed,- in¬
deed, it fortifies the decision of
the
Supreme Court that insur¬
secured by the mort¬
gage would be written, placed and
sold by the mortgagee.
tie-in
coercive
These
results:
had
four
owner
of the residential property
ard
was
placing his
haz¬
insurance
with
insurance
agents and companies of his own
insurance agents and
normally would
(2)
choice;
who
brokers
compete with the mortgagee were
prevented from competing for the
sale of hazard insurance on
prop¬
erty mortgaged to the lender: (3)
insurance companies, other than
those selected
by the lender, were
from
foreclosed
free
to
access
a
substantial market for hazard in¬
(4)
and
surance;
borrowers were
consent
place hazard insurance. It pro¬
hibits similar agreements in the
future.
Further, it requires the
mortgagees to inform loan appli¬
cants and existing mortgagors of
insurance of
their own choice.
This judgment
recognizes that mortgage lenders
have a right to insurance from a
reputable and reliable insurance
company.
To protect the legiti¬
right to select
interest
mate
this
of
defendants
the
the judgment per¬
mits them to require that hazard
score,
insurance
be
written
by
a
acceptable to them,
com¬
so
long
their standards of acceptability
as
not
unreasonable, arbitrary, or
discriminatory.
It likewise
en¬
defendants
ables
the
write
hazard
to
insurance
place
on
or
prop¬
mortgaged to them if the
improperly fails to
erty
borrower
tender
the
within
reasonable
a
time
type of policy judged accept¬
under
the
foregoing
stand¬
ards.
the
case
Liberty
Co. is
13 322
14 91
United
States
The
1954.
that
S. 533, 562
No.
7719-S,
they
be
(1944).
D.
C.
Ala.,
prima, facie
illegal
are
unreasonable
That is to say,
restraints of trade.
the
Cong. Rec. 1486 (1945).
15 Civil
29,
U.
of
National Life Insur¬
Our complaint in this
the
premium as a dividend or al-.<
against mutual compa¬
nies and against companies selling,
insurance directly to the public
through
branch
offices.; Upon
cross motions for summary judg-;
lowance,
ment, the court said, with respect;
"The
unless
listed
above:
Writer
Rule
rule
last
the
to
Direct
;
•
is
a:
refusal to deal which relies
coercion to effectuate its
purpose and, under the authori-,
ties
it must be held to im-,
pose an unreasonable restraint of.
competition
in
interstate
comgroup
upon
.
.,
merce."19
they
can
contended that;
of the Board
The Government
each
these
of
constitutes
cott and
rules
agreement to boy7
an
such is illegal per se,
as
that it falls
practices
which
have been
found by the
courts to be so inherently unrea¬
sonable and so destructive in their
other
in
Or
within
words,
class
that
effect upon
•
of
competition that they;
forbidden
are
as
Price-fixing is
ample of such
matter of law.
a
well-known ex-,
a
per se illegality..
defendant Board conceded in
The
effect
the
that
rules
were
con¬
argued
certed refusals to deal, but
that
they must be proven to be
unreasonable before they could be
to
be
"rule
the
that
The
court
defendants and
illegal.
the
with
of
reason"
applied to test the legal¬
must be
Board's rules.
ity of the
No decision was reached by
the
restrictive
rules of the Board, either because
Court
certain
other
the
to
as!
ones
were
discontinued
after the case was filed or because
there
disputes of fact as to
were
>
the effects of other of these rules
competition,
on
after
be
decided
complaint in United States;
Orleans
New
v.
to
trial.
a
Our
Ex¬
Insurance
that,
against the Cleveland Board. The
Exchange, a private association of'
130
insurance
agencies,
which
controlled
approximately three-J
fourths of the fire, casualty and
surety insurance business in the New Orleans area, was charged
change 20
with
2
of
similar,
was
violations
the
to
1
and
In
the
Sections
of
Sherman
Act.
.
words of the court:
; "The group boycott is effected,
through a series of by-laws of the
Exchange by which members;
thereof agree to boycott any
stock
which plants through'
except Exchange agents in'
.
company
any
Justice,
boy¬
non-member
held
through the'mortgagee.
judgment termi¬
nated the agreements which gave
the defendants an exclusive right
on
rules
illegal
nies, against deviating companies'*
or
those
returning any part of
agreed
their
certain
constituted
have been lower than those avail¬
The
area
Of
operation
which
held
Supreme Court has said
tying agreements "serve
hardly any purpose beyond the
ance
is commerce.
suppression - of
competition." 17
It leaves the
Because of their inherently anti¬
anti-trust laws in full force and
competitive nature, insiirance tieeffect, even during the morator¬
in
contracts
ium against boycotts and
falling within the
agree¬
ments to boycott." 14
purview of the Sherman Act are,
in the view of the Department of
In 1954, a consent decree term¬
v.
the
writing fire:
through;
and
that
in
Insurance
prevented from obtaining hazard
insurance at premium rates which
able
selling
of
hess
The
mortgage loan
a
from
prevented
(I)
,
inated
The
agree¬
ments
leaves
ance
in the Cleveland, Ohio, area.'
complaint alleged that the.
Board
conspired with its mem-,
bers to restrain and monopolize
interstate commerce in the busi-i
age
.
the property
able
said:
ance
85%
its
borrower
the
are
the
insur¬
merchandise
in
remain
to
burial
of
Services16
into
Insurance
v.
a
boycotts were used against»
agents and compa-'
sale
terminated by a consent
panies in
States
The Board,,
membership of 452 insur-I
agents, accounted for about;
of all fire insurance cover-:
with
Acording to the complaint,r
Statesv.
United
United
of
Board of Cleveland.18
these
funeral
versified
August, 1956, a district court-
cotts.
Alabama.
pany
tion
the
end
In
opinion was rendered in the case
competitive condi¬
to restore
Thus, it is clear that
coercion, intimidation and boycott
subject
has
arrangements
to
contained in this Act
render
with
designed to
are
who obtained
Act.
Third, when one of these investi¬
gations indicates that the Sher¬
agreed
contract
not
restrictive
and
information
company and important officers
have in fact acted in violation of
fore
decree
sent
these
residential
unearthed by the investiga¬
should
determine
whether
man
would
rowers
filiated
the
it
com¬
other undertaker to service
Liberty National burial insurance
policies in such exclusive territor¬
ies.
The provisions of the con¬
entered
currently being reviewed. The
tion
that
undertakers-and
ob¬
jury to
grand
The results of this
qre
facts
cies and the collection of relevant
data, all in order to de¬
whether further action is
al¬
Because of
access
of
instituted
own
two
records.
economic
termine
rant
issuance
in the
correspond¬
informed
other
or
grand jury.
a
these
the in¬
to present the mat¬
been
our
has
indi¬
or
the importance which attached to
this matter, I chose the latter al¬
ternative.
As is customary, this
the
a
Division
vestigation,
ter
have
to
and
policy holders of
any-
either to drop
ternatives:
ment
Chief, I will
preliminary inquiry.
Such inquiries are not full-scale
investigations
but
are
usually
indi¬
an
exercise
to
ques¬
Section
files.
as
corporation
a
desires
dation
confined
If
records.
complaint
a
pgrmit
their
well
as
in¬
agency
to
examine
to
The anti-trust
these
to
that
FBI
contract
;
•
refused
corporation,
is important, upon the recommen¬
a
cor¬
viola¬
the
case
its affiliated
vidual
inquiry?
indicate
of
a
a
•
particular
company
the
any
can
National
erty
po¬
vidual may refuse to give inform¬
ation
or
refuse
access
to - its
ways.
measures
this
and
be handled in
determine
to
-
-
In
A
First, we
procedures
with other interested government
bodies whereby we consult with
them
that
mean
is suspected of
stitution and
liaison
up
his
peting burial insurance companies;
In
return, Liberty National
granted exclusive franchise rights
within a specific territory to its
poration
are.
may
into
funerals for
insurance indus¬
several
set
of
entered
tors, customers, or any others who
possibly have knowledge of the
alleged violation. Thus contact by
." 12
insurance complaints are
of
one
have
searches
had
tential defendants, their competi¬
to possible viola¬
They
certainly
received
file
This
case.
themselves.
defendants
director agreed to purchase all of
funeral supplies through Lib¬
Such an
includes in¬
often
individual
each
been
contracts under which the funeral
investigation.
current
our
When
the
insurance company.
terviews and
been asked
investiga¬
has
field
in
tention
The
chan¬
a
investigation
tions of the anti-trust laws.
10,
full
.
most
the
com¬
repeatedly called to the at¬
of the public, and those
monopolize, attempting to mo¬ lenders who persist in unreason¬
nopolize
and
actually monopo¬ ably denying their borrowers ac¬
lizing commerce in funeral mer¬ cess to the competitive insurance
chandise
and
burial
insurance." market will invite litigation upon
result of these complaints
I requested the FBI to conduct a
Procedure
authorize
that
exemption exists lor these
an
.
.
affiliated
the
:,v As
Antitrust Division Investigative
try are related
.
as¬
(Emphasis supplied)
quote. Referring to the state laws
permitting cooperative rate mak¬
ing, he noted that "in permitting
this combination through rating
bureaus, it was not intended to
destroy competition and to make
.
the
business may be involved.
tions within the
.
to
have
except
states
responsibility, and are
effectively performing
that
re¬
sponsibility for the regulation of
whatever aspect of the insurance
observation which I should like to
rates uniform.
affect the busi¬
and
insurance
that
sumed that
than the bureau rates. The Super¬
intendent
full
ness
extent
that
constituted
insurance
pany
majority of insurance written by
a
inde¬
lower
are
in
and
business
neled
the
and two subsidiaries with
conspiring to r e s t r a in and to
company
institutions
charged
case
which was con¬
trolled by officers of the lending
Thursday, August 21, 1958
.
.
.
the New
any
Orleans area, to boycott
stock
company
which
>
sells,
directly to the public, to boycott
mutual
companies irrespective of
how
by whom the insurance is
or
sold, and to boycott non-member-
agencies
so
companies
that
the facilities
planting
of
exclusively
through Exchange outlets are de-.
nied such agents." 21
'
•
•
''/
„
shown to be reasonable under
18 144
peculiar and particular facts
19 Id.
F. Supp. 684
(1956).
~
.
702.
at
'
»
June
16 Civil
No.
3713,
D.
C.
Minn.,
20 148
22
30,. 1954.
17 337
June
U.
S.
293, 305
(1949).
F.
Supp.
(1957).
21 Id.
at
915,
aff'd,
.....
917.
355
S..
U.
■
-
1
Volume 188
Number 5770
.
The Commercial and Financial Chronicle
.
.
affiliated
The
Exchange argued among
things, that its restrictive
by-laws were intended to protect
the American agency system. The
court, however, said that these
assertions
of
good intent were
also subject to considerable ques¬
other
The
tion.
mutual
use
the
suit
system.
there was
agency
until
Moreover,
1950
concluded that the
regulations.
local
of
parts
Intelli¬
concerned.
and
'-"Most
have
in
other
country
their
see
calling
already
by-laws to
agents
reportedly
sale
mutual agencies to
what their attitude is.
Some
on
planting in mutual agencies
come
•
boards
the
amended
are
may
a State where
mixed agen¬
cies have been
strictly taboo, but
recent
changed the picture." 23
held
violate
consequently they
practices
cease
to
the
the
I.D.S.
This result followed
decree
it
and
is
New
by
Orleans
"New
the
case
the following
is
as
Orleans
have
been
comply
with
the
of
case
is
indi¬
also
ap¬
a
manner
not
re¬
quired by the Judgment itself:
New
decisions
have
24 148
closing, I believe it
quote the
Orleans
case
Supp. 915,920
(1957).
court
in
the
Now Midland Canadian
concerning the
of free competition
the insurance field:
economic
F.
appro¬
necessity
"Our
submitted
faith
is
WILMINGTON,
in
firm
*
predi¬
cated on free competition unin¬
hibited by group boycotts or other
name
of
Del.
Midland
ana
of
m a
if reports
give
to
the
agencies
y;
in
be
Louisi¬
the
offing
from the Pelican State
indication.
any
in
.22 87 Ins. Field 13-14
Stock
com¬
predatory
must
test
practices.
merchandise
of
Not
stand
the
performed in connection with the
(Jan. 17, 1958).
23 87
Ins.
Field
20
(Feb.
28,
With Smith, La Hue
cold
competition, -but services
1958).
tion
of
duction
in
In
insurance
of
cost
the public. ".
decision rendered
a
1957,
ruary,
the
in
•
Feb¬
that
held
court
this illegal group boycott .must be
destroyed.
firmed
the
L
This decision
by the Supreme Court of
United
A
States
situation
New
af¬
was
last
October.;
Orleans
exists
do not mean low rates
to" that* in
similar
in
another
When the insurance agents
realized that they were being in¬
vestigated by the FBI in our be¬
half, they requested us, and we
agreed, to withhold the filing of
the action until the litigation in
city.
the
New
Orleans
cluded.
A
case
judgment
that in the latter
case
is
earnings do not mean hi]
con¬
was
similar
to
be¬
now
ing prepared and will be adopted
by consent of the parties in this
second, city.
Effectiveness
of
Division
the
;
Program
The
volume
insurance
of
com¬
plaints^ received by the Division
reached a peak shortly after the
I.D.S. decree.
The publicity re¬
ceived by the decree in the mort¬
gage and insurance fields, how¬
'has
ever,
factor
'
in
avoid
the
been
an
important
educating
lenders
to
tie-in practices.
number
ceived.
An
nation's
tions
in
of
letter
recent
a
com¬
in
series
a
pledgeditself to'provide .the best
which
of
re¬
possible service at the lowest
direct
absence
coercion
campaign
attempts
most
at
these
of
sued
tice
informative
the
and
in the
decree
consent
publicize
to
by
I.D.S.
other
the
;
is¬
We
it
are
are
also
been
agents
of Jus¬
at the lowest cost
f
we
mean
!
Today,
r.r'
j
i
in the. long run
r
than
more
*„
ever,
it is evi¬
on
good earnings
dent that the best service-at the low¬
est cost in the
long
earnings.
run
depends
'
•
on-
/
advised
that
by
conditions
competitive, that doors
open to them which for¬
were
closed.
This
is
en¬
couraging as it confirms our opin¬
that responsible lenders will
voluntarily seek to eliminate ob¬
jectionable -practices.
We
con¬
tinue, however, to receive corre¬
spondence from insurance agents
ahd mortgagors complaining that
their selected policies have been
rejected or that various obstacles
ion
have been raised by lenders.
To
a
considerable extent the pub-
Without
more,
do
not
indicate
scheme to channel insurance to
affiliated
be
afraid
think that low
rates and
rates.
the
earnings
good earnings
lowest
who
come
mean
mean
to
Or the lowest earning meat
makes the best and cheapest hams.
high
Or that the lowest
people have the idea that
earning
soap
packer
It doesn't
low
!
.
Yet few
many
have
company
in
anv
earning company
line makes the best and
——
■
cheapest products and renders the
makes the best and cheapest soap.
best service.
There
of
the
-
of
do
to channel insurance to
an
BELL
TELEPHONE
are
telephone
cost and
apply to the telephone
either.'
company
*
many ways
users
in which
benefit in both the
quality of service through
good earnings for the telephone
company.
a
the complaints, how¬
indicate strongly that
the lender is not protecting a legi¬
timate interest at all,' but is em¬
ploying
indirect
and
coercive
means
are
an
but,
instead,
readily interpreted
safeguards
mortgagee's interest.
•
Some
we
should know.better,
agency,
more
legitimate
ever,
lie, and
The
major portion of this correspond¬
ence
deals
with
requirements
adopted
by
mortgagees
which,
as
._
more
now
merly
chn
-r
now.
good
have
: ::
We meant it then and
government agen¬
cies."
insurance
-
-
case
material
the Department
and
r< i.:
r rj't
..■>
letters indicates fine results from
the
possi-
—.—j—.—p
of
in
v. v
,,
ble price.
straints reported by the associa¬
tion's member companies:
T'The
The best service
associa¬
following
summarized
the Bell System
ago
re¬
of the
one
insurance
the
Many years
reduction
a
complaints
official of
large
made
ment
he
!■'
insurance
This in turn has led to
in
<..
SYSTEM
...
"ST. PAUL, Minn. — Harry B.
Gough is now affilated with Smith*
La Hue & Co., Pioneer Building.
to
:-1^.
.'v
-
.
(Special to The Financial Chronicle)
system, but the preven¬
a
possible reduction in
commissions caused by re¬
agency
The
Midland Canadian Corporation.
only
boycott of mutual, as well as par¬
ticipating stock companies, is not
the protection of the American
agency
—
Securities
Corporation, Industrial Trust
Building, has been changed to
k
Ex¬
amended
ruling
in
"Mixed
Insurance
change
Louisiana
indicated
Orleans—The by-laws
New
this
quotation
parently aiding in establishing a
more
competitive
climate
in
fol¬
item:
news
that
In
court
priate to
<
.
following
cates
courts
anti-trust
laws."22
The
which
be
same
test, so that in the
analysis,
the
public
may
have a free choice in spending its
money,
and businesses,
willing
and
able
to
compete for
that
money, may have a free oppor¬
tunity to do so." 24
been
rules
must
21
last
months, ob¬
report. Louisiana long has
eliminate the 'in and out' rule and
themselves,
upon
thereof
the
to
in the next few
servers
similar
litigation
lowing in the aftermath of the lit¬
igated
judgment in the recent
for the
reason
Sherman anti-trust laws under its
rules
successful
any
special
pany
invite
the
,
Court, affirmed
Court, that the
violating
the
Supreme
Exchange
w a s
gent businessmen do not wish to
sent decrees.
by-law which ap¬
plied the boycott against partici¬
pating stock companies using the
American
agency
system,
irre¬
spective of their willingness to
submit to Exchange control.
Al¬
though the by-law was repealed
in 1950, the evidence showed that
the boycott continued.
The court
Exchange
an
of
District
by the
re¬
by the courts or that have been
voluntarily relinquished in con¬
government's witnesses were
agents who are a part of
American
to
which have been held to be illegal
mutual
the
Federal
some
company.
continue
attention.
effect
directly
are
are not
the Ameri¬
affiliated
will
by the government extends
beyond the defendants who
far
In fact, all of
agency system.
can
our
The
in
and
agency
an
abuses
ceive
who
companies
direct writers also
Such
that
showed
evidence
to
cases,
(721)
22
The Commercial and Financial Chronicle
(722)
Continued
from
Sums Up
11
page
ments of this program
Promoting Peace and Progress
v
whole.
a
They
are:
(1) United Nations
-
4
.
,
Agonizing
Reappraisal of Foreign Policy
concern
■
for
"This country
emerged from World War II at an
unprecedented pinnacle of world power and in¬
United Nations measures to
in Jordan.
(2)
preserve peace
reached
to establish
cannot
regional
on a
forget from the past.
remember
basis.
tic
Second—that these consultations
and
that
Western
algebra
We
and
the
much
owe
to
education.
ligions
born
were
But
organizations which might be pre¬
pared to support this institution
can
should
in
Near
the
Arab
true
renaissance
human
also' be
consulted
at
an
appropriate time.
First Requires Arab
a
only develop in a
setting. Material
healthy
progress
should not be an overriding ob¬
jective in itself; but it is an im¬
portant
condition for achieving
Self-Aid
Should the Arab States agree on
the usefulness of such a soundly
higher human, cultural and spir¬
itual objectives.
But I repeat, if this vision of
organized regional institution, and
should they be prepared to sup¬ the modern Arab community is
port it with their own resources, to come to life, the goals must
the
United
States
would
also
be
be Arab
goals.
' t
The institution would be set up
to
VII
provide loans to the Arab States
well
the technical assistance
as
With
the
United
,
assistance
Nations,
the
,
of
the
to
United
A
fomenting
Nations
fluence. Most of the world
looked upon
as the
great
Peace
Force.
(5) A regional economic devel¬
Even
opment plan to assist and acceler¬
ate
improvement
standards
in
living
the people in these
of
(6)
race
have
To
new
acted
arms
the
the
should be considered and
no
together, as integral ele¬
ments of a single concerted effort.
Therefore, I hope that this As¬
in
in
the
Near
East
ard of
the
framework for
living of the Arab jmoples.
IX
for
proposal
regional
a
Arab development institution can,
I
for peace of the kind I
proposing can be carried for¬
ward, in a few short years we
believe, be realized
on
basis
a
am
be able to look back
may
on
as
beginning of
Arab history.
era
I also believe that the best and
quickest
way
desirable
to achieve the most
result would
Secretary-General
sult
with
Near
the
East
to
Arab
has
vast
two
First to
of the
an
area
Then to invite the
Bank
for
is
new
con¬
must
mind
in the future.
today
there
If
and
is
end
an
remain
to
in
external
interference in the internal affairs
of
the
Arab
States
of
the
Near
East:—
Recon¬
Development, which
experience in this field,
If
adequate United
an
Peace Force
for
Nations
is in existence ready
call
by countries fearful for
the planning of the organizational their security:—
If a regional development insti¬
and operating techniques needed
to make available its facilities for
to
establish- the
progressive
-
institution
on
a
tution
the
course.
exists
basic
is
and
projects
at
and
work
on
programs
designed to lift the living stand¬
ards of the
area,
supported by
friendly aid from abroad and gov¬
Requires Arab Leadership
I hope it is .clear that I am not
suggesting a ^position of leader¬ erned by the Arab States them¬
ship for vmy own country in the selves:—
work of creating such an insti¬
Then with this good
prospect,
tution. Tf this institution is to be
a
success, the function of leader¬
ship
must belong
States themselves.
to
the
and indeed
as
a
condi¬
necessary
remind
had
which
we
must
ask
believe
that
the
nations
of
ex¬
though their peoples with valid
have
been
their
modernizing
societies.
Other Regional
The
been
if
enlarging its allo¬
deep roots in their
liam
of
more than
those quoted—may well have a
good deal to support them, hut we suspect our most
urgent task is an "agonizing reappraisal" of the
American
role
States, we are consulting with our
sister republics of this hemisphere
to strengthen its role in economic
development.
And the Govern¬
ment of the United States has not
been alone in
supporting develop¬
efforts.
ment
The
British
Com¬
peoples."—Senator J. Wil¬
much
are
working on methods to
strengthen these regional arrange¬
ments. For example, in the case of
Organization
own
Fulbright.
We should indeed ask ourselves
why we "have
slipped." The Senator's strictures—which include
Plan; and
we
the
same time it shows
aid, reluctantly given,
all, to governments which refuse to parrot
at
anti-Communist lines but which, nevertheless, have
opment in response to these world¬
wide hopes.
We have joined in
partnership with such groupings
as the Organization of American
States and the Colombo
want
we
in which
era
to
we
undertake in
this strange world
live.
possibilities
hopes
the
are
arms
are shadowed, all our cern, our
responsibility
dimmed, by the fact of strength.
in nuclear weapons
which drains off our
race
monwealth, the countries of West¬ —a contest
ern
Europe, and Japan have all best talents and vast resources,
made significant contributions.
straining the nerves of all our
But in many
might
governments.
At the
Developments
American Government has
steadily
reason
disenchanted with those
As I look out
so
on
the desire for a regional
approach is clearly manifested and
where the advantage of regional
many of you representing
nations,
world
of
As
after another of these
one
nations
many.
our
enough work and enough reward
to satisfy the energies and ambi¬
tions
of
all
leaders, everywhere.
this Assembly,
-
where
and
In this memorable task there lies
parts of the world peoples.
both geography and wise economic
area,
one of the major
spiralling military buildups which
challenges of the Near East, the lead not
only to economic im¬
great common shortage—water.
potence but to war.
is, why have
governments which profess their anti-communism
for
the
be action toimeet
ourselves
even
possibilities
one thought above all
grams. The United States will, of impresses me.
intellectually and emotion¬
I would hope that high on the
The world that is being remade
course,^ continue its firm support
ally, will no longer feel the need* of
such national programs.
Only on our planet is going to be a
agenda of this institution would to seek national
security through-
Arab
the
decade later this
indiscriminately to governments which serve
the needs of their
peoples and alike to those which
do not. It shows aid
eagerly and lavishly given to
planning favor national rather with
fulfillment, 1 hope and than
regional development pro¬ new
tion for its
a
tended
cations to foreign economic devel¬
important
an
of
sideration which
con¬
States
determine
of agreement.
International
struction and
make
to
parallel approaches.
for the
be
But there
great
a
hardly
the
the
Lebanon and Jordan crises
capital, both public and private.
almost
-
whole world has become alive to
the
which would attract international
of
"It (the record of the past decade) shows aid
countries
plan
a
This
wave
slipped?
we
of
But the peoples of the Near East
required in the formulation of de¬ the Near East now have a unique
are not alone in their ambition for
velopment projects. opportunity to advance, in free¬
independence and
The institution should be gov¬
development.
dom, their security and their po¬
erned by the Arab States them¬ litical and economic interests. If We are living in a time when the
selves.
the
areas
tion
a
effort to raise the stand¬
the
was
Sen. J. W.-Fulbright
disappeared in
of the world, and in
many others it was gravely shaken. The first ques¬
principles of the United Na¬
tions Charter, and at the same
create
leadership of
shake that
to
need
large
the
time
able
conviction
with
consonant
and
progress,
future, not communism, and
power of Soviet propaganda
"I
climate of security
a
peace,
Senate that
that
measures
were
enemies
universal conviction.
simultaneously
seek
motion
would create
for
international
was
-
will
set
to
We
hope of mankind.
freedom. This
solidity, the different
on
sembly
us.
ostensibly not unfriendly.
deed as well as in word, we
In
elements of this plan for peace and
progress
with
was
end of the earth to the other
one
erstwhile
our
stood
Steps to avoid a
spiral in the area.
from
were
the
Arab nations.
common
prepared to support it.
as
(4)
-
Third—other nations and private East.
end
An
from without of civil strife.
arithme¬
composition and the Arabic mathematicians and that
possible functions of a regional much of the foundation of the
Arab > d e v e 1 o p m e n t institution, world's medicial science and as¬
whose task would be to accelerate tronomy was laid to Arab schol¬
progress in such fields as industry, ars. Above all, we remember that
agriculture, water supply, health three of the world's greatest re¬
consider
(3)
contributions surpassing those we
de¬
Arab
an
velopment institution
Thursday, August 21, 1958
Wanted: Ait
be viewed
„.
Lebanon.
In the Middle East
.
Six Proposals
It is important that the six ele¬
as
..
mature
nations.
new
Halsey, Stuart Group
Offers MOP Equipments
.Halsey, Stuart & Co. Inc..and
associates
275,000
Aug. 15 offered S4,Missouri Pacific RR.
on
of
through the diffi¬ 4Vi% serial equipment trust cer¬
over national is evident will the
cult transition to modernization
and engineer¬
tificates, series K, maturing Sept.
Perhaps the nations involved in United States change to
regional and learns the methods of growth,
already under way the 1948
1, 1959 to 1973, inclusive. The cer¬
hostilities may, as a first methods.
in the field of water
J from this travail, new levels of
development.
tificates are priced to yield from
For instance atomic isotopes now step, wish to call for a United
The United States is
proud of prosperity and productivity will 3% to 4.40% and were offered
Nations study of the flow of
heavy the scope and variety of its devel¬ emerge.
permit us to chart the course of
subject to approval of the Inter¬
armaments to those nations.
My opment activities
the great underground rivers. And
throughout the
This world of individual nations state Commerce Commission. The
country would be glad to support world.
new horizons are
Those who know our his¬ is not
opening in the the
going to be controlled by group won award of the certifi¬
establishment of an appro¬
desalting of water. The ancient
tory will realize that this is no any one power or
group of powers. cates at competitive sale Aug. 14
priate
United
Nations
body to sudden, new
problem
of
water
is
on
the
policy of my govern¬ This world is not going to be com¬ on a bid of 98.57%.
examine this problem. This
body ment.
threshold
of
Ever since its birth, the mitted to
solution.
Energy,
any one ideology.
The certificates are secured by
would discuss it individually with
United States has gladly shared its
determination and" science Will
Please believe me when I say new standard-gauge railroad
these countries arid see what arms
wealth with others.
carry it over that threshold.
*
This it has
that the dream of world domina¬ equipment estimated to cost
control
arrangements
could
be done without
$5,Another great challenge facing
thought of conquest tion
worked out under
by one power or of world
Much
ing
moves
scientific
work
is
.
.
the
area
is
which
disease.
Already there is substantial ef-: curity
fort among the peoples and
gov¬
ernments
of
the
Near
East
to
conquer
But
disease
much
more
and
disability.
remains
to
be
maintained
than
under
dangerous
ments.
The
continued
a
arrangements
must
United States is prepared
with other governments
the World
tion in
an
Health
preventable
East.
disease
in
the
on
Near
to
Past
Arab
Contribution
But
to
see
I
have
the
desert
in
the
Near
a
blossom
century
arma¬
such
any
reflect
these
people
gional
East
to you
plan for
East
wars
After
and the
expenditure of vast treasure there
is
or
no
world map,
economic,
find
arms
that
or
on
the
either geographic
which anyone
force
of
which
peace
freedom,
can
American
the power of the Ameri¬
can
Treasury has absorbed
foreign land or political or
present
a
the
each
arms
the
to
domination.
nomic system.
to
to
in
permit
economic
or
victory in two world
we
As
we
believe
cherish
in
any
eco¬
our
freedom
for others.
rights
of
nation;
which
race;
devote
wholeheartedly
of
their
to
the
development and human
in the widest sense.
the
.which
the dangers of
peoples
508,000.
conformity is
The
the
a
re¬
would
Near
energies
tasks
of
progress
good sense, restraint, and wisdom
make, with time and patience,
a framework of
political order and
to
of peace in that
region.
But we also know that all these
impossible dream.
nature
tions, and the widening circle of
new nations make it plain that we
must, in the end, be a world com¬
munity of open societies.
And the concept of the open so¬
ciety is the ultimate key to a sys¬
tem
of
arms
control
we
can
all
trust.
vigor,
a
must, then, seek with
new
peace
trol
of
of all
new
initiative, the path to
based On the effective
armaments,
advancement
and
on
on
con¬
economic
peoples to be ruled by gov¬
of
their choice.
Only
can
we
members of
are:
Baxter
the
&
offering
Co.; Mc-
Master Hutchinson & Co.; Wm. E.
Pollock & Co. Inc.; and Shearson,
Hammill
&
Co.
Two With Paine Webber
(Special to Toe Financial Chronicle)
LOS
ANGELES, Cal. —Thomas
Cunningham and John A. Cle-
land have joined the staff of
Paine,
Jackson & Curtis, 626
Spring Street. Both were
formerly with Salik & Co.
Webber,
South
the freedom
ernments
thus
Other
group
M.
We
The things I have talked about
today are real and await our grasp.
Within the Near East and
within
this Assembly are the forces of
an
of today's weapons,
the nature of modern communica¬
would
setting of political order
responsive
would avoid
again
and
preventable
disease
conquered is only a first step. As
I look into the future I see the
emergence .of -modern Arab states
that would bring to this
tried
the framework of
provide
World's Debt
in
VIII
Organiza¬
all-out, joint attack
wasteful,
views.
own
join
and
se¬
effectively
competition
countries'
to
more
I recognize that
be
done.
the
of all these nations could
exercise the full
Matthew F.
Matthew F.
Reilly
Reilly, partner in C.
pacity God has given us to enrich J, Devine & Co., New York City,
the lives of the individual human passed away suddenly on
Aug. 12
beings who are our ultimate con¬ at the age of 56.
ca¬
Volume 188
Number 5770
Continued
from first
.
,
The Commercial and Financial Chronicle
.
banks followed the lead.
page
Feb.
19
and
Aug.
Between
Expansion
America's
13,
American
gold reserve shrank by $1.64 bil¬
Recession in
60% capacity, its output
average
is
almost
1929.
30
First
sales
of
million
quarter
($21.15 bul¬
lion) in many years. But the total
into
stepped
serve
market
open
the
act .with
operations
factory
serve
requirement
motorized
order
to
1958
million
2.2
above
tons
authorities
lion to the lowest level
of
provide
and
re¬
reductions
in
foreign short-term holdings
mained
stationary:
our
of
payments having
favorable^—"thanks"
horns of
balance
turned un¬
to
Foreign.
Aid—private dollar reserves held
appreciably ahead loanable funds and to restore the abroad could increase as the offi¬
of the same quarter of 1929; and liquidity of the banks (an objec¬ cial qnes
decreased.
The debts
the cars are now much bigger, tive that was not difficult to attain stay, but the gold to cover them
in
the face of a declining
stronger and better equipped. At
de¬ seeps out.
/
A
'
,
that, one should bear in mind the mand).
So far, Washington authorities
currently vastly greater output—
disclaim any worry about this de¬
Inflation with Inhibitions
'always per capita of population
velopment.
In reality, there is
—of homes, farm products, elec¬
The
results
are
disappointing ample reason to worry. While we
tronics, household appliances, and for optimists and pessimists alike. lost gold to the tune of $1.6 billion,
so
on, to say nothing of military There was general agreement that the
money supply
(cash in cir¬
equipment.
A
the
recession
has
reached,
or
culation
and
net
adjusted de¬
In
fact, the Federal ' Reserve passed, the bottom, with a fresh posits) has
risen, with seasonal
Board's index of manufacturing
upturn around the corner, very fluctuations, by four billion dol¬
production (average physical vol¬ near or somewhat remote as it
lars, is not more. The latter keeps
ume
per working day)
stood at may be. The inflationary expecta¬
going up, the former down. The
128 last May, which was better tions were mirrored in
rising stock status of the Federal Reserve Sys¬
than 220% of the 1929 volume.
market quotations. ("Thanks" for tem itself is worsening progres¬
What is much smaller now, is the.
reduction, last January, of sively. Pari passu with the gold
the number of—failures and fore¬
margin requirements on security losses,
its
bond
portfolio
has
closures.
Unemployment?
On a loans!)
But inflationists of
all grown to the tune of $2.25 billion.
per capita basis, it is practically
denominations
are
not satisfied With some $25.6 billion it is now,
the same as at the peak of the gay with a" Federal deficit of
$10-to- after 13 years of unprecedented
'Twenties.
A
V,.$12 billion in the offing for the prosperity, at an all-time peak!
In
terms
of
any
reasonable fiscal year 1958-59. Labor spokes¬
What
worries,. the
European
historical reference, we are still
men, especially, and other protag¬ central banks—and incites their
in the midst of the Great Boom onists of a
3% or 4% annual rise wishful imagination—is the pros¬
that got underway in 1942. Which of
prices, are anxious to light pect of a huge and "permanent"
is what the consumer price index
again the inflationary fuses. They deficit in the U. S. budget. Most
shows, so far, by inching upward want "quick and effective" action, of that deficit has to be "coined
vehicles
ther.
after
month
that
would
in the
bling
be
throes
behavior
a
most
unorthodox
of
anything
Serious Recession.
a
Evidently,
constitutes
a
cycle
ness
month,
resem¬
concepts of what
change in the busi¬
have
changed.
The
of the "cycle"—the
overriding objective of monetary
management
and
fiscal
out"
preferably also tax reductions.
portion.
since
not fail
realize that
to
liquidation
cards.
as
abruptly
neither
it
will
distinct.
It
de¬
pends, to be exact, on the wishful
thinking of the public.
Built-in Inflation
that
the cycle did turn, or started to do
so.
But the boom's slow-down—
much
at stake—was countered by
more
a
probably
was
either
to
comprehend
deficit financing cannot end
it had started; that
as
sumably;
that its inflationary
or
the banking system, of
government's obligations. The
debt
ceiling that had
been raised earlier this year from
not
billion
that will not be the end
But
be
ing power was nearing exhaus¬
tion; it was operating on the "last
legs" of its liquidity. Rising in¬
terest rates
served
as
signposts
social security
and deterrents—the automatic de¬
the.
price \mechanism.
That mechanism became operative
in more than one way, each en¬
hancing the effect of the other.
The
inflation
has
pacities
,
commodities
hard
sumer
stimulated
an
productive ca¬
numerous
lines,
of
along
basic
from
to
con¬
machine
market
and
goods
tools. There simply was no
sure.
which
close to
A
/
for one thing, an
unprecedented inventory accumu¬
quence
lation.
was,
confusion
The
founded
was
con¬
elimination of overindebted consumers as buyers; the
unavoidable process of inventory
by
does
that
is
dollar
the
the outside.
is
not
Federal
50%
works were increased by
over
what they were two
Administration
and
Congress were competing in boost¬
years
ago.
ing military and "social" spend¬
ing, Federal payrolls, all sorts of
open
or
hidden
subsidies
and
guarantees. All ideas about
econ¬
omy
were
basket.
States
followed
and
heading for the waste
suit
other
and
municipalities
with
road
building
projects.
Federal Re¬
construction
Simultaneously,
the
margin
security loans,
writing the discount
upped from 1%%
and
with
the
printing, and
so
ing
left hand
measures.
A
So
far, the interferences with
the course of the "cycle" have one
tangible result: the necessary ad¬
justments in the wake of -the
money
on.1
if at all,
reduced
crisis
occur—if, for example, the
really boil
1 According to reliable reports, a new
buyer appeared on the London gold mar¬
accounts."
Lately, thanks to the strong declaration
of the Secretary of the Treasury against
devaluing
the dollar, the gold outflow
American
again
down
to
when
"private
a
price
trickle.^ It may restart
inflation gets under
way.
New
Haven & Hartford
The
member
1933. He
Railroad,
Massachusetts
cock, Mr. Stack was associated for
several years with the Seaboard
Air Line Railway, and later with
a
member firm of the
Stock
New York
Exchange. He attended
Trinity College, now
versity.
Duke
Charles
been
Alan
formed
East 56th
to engage
&
Co.,
with
>:A
>A''
ternational
supposed
sance."
hearts'
to
We
payments,
we
W. H. Biesel Opens
business
William
from
under
H.
offices
the firm
Biesel
at
19
&
name
in
domestic
Benwood
Avenue.
By all indications of the longeroutlook, we are heading for
inflation, if not for devaluation.
run
Form Boro
Investing
BROOKLYN, N. Y. —Boro In¬
Yet, it is hard to believe that the vesting Corporation has been
world's
richest
country
should formed with offices at 1008 Gates
proceed recklessly to ruin its cur¬ Avenue to engage in a securities
rency,
to defraud its savers, to up¬
business.
.
X-'' ''"••••• •'
■■
'
would
held
remain
in
this
country
convertible
into
gold at the rate of $35 per ounce.
Almost
was
of
47% longer life
infla¬
on
the chin; it remained the
leading currency, the global unit
of account, and the repository of
foreign central reserves. Thic was
predicated on the outer-world's
confidence
that
foreign-owned
balances
health" in Puerto Rico
at
once,
shaken.
The
the confidence
cautious
Just since 1940, life expectancy in Puerto Rico
has risen from 46 to 68 years—or over 47%!
The death rate has
dropped from 18.2 to 7.1
1,000 people. To a considerable extent, these
swift, amazing advances in human welfare
per
reflect the successful efforts of Puerto Rico's
Aqueduct and Sewer Authority to supply pure
water and modern sanitation throughout the
service is around $2.50 a month!
of the Aqueduct and
Authority have nearly quadrupled since
1945, rising from less than $2 millions to nearly
$8 millions. Moreover, the coverage by which
Annual gross revenues
Sewer
net
revenues
have exceeded
principal, interest,
and reserve requirements has more than doubled.
Commonwealth.
The Bonds of the Puerto Rico Aqueduct
Every town and city in Puerto Rico today
has a constant, abundant supply of safe drink¬
ing water at low cost. The average charge to
residential customers for both water and sewer
and
and are well
represent at¬
tractive investments which provide an adequate
Sewer Authority are tax-exempt
secured. At current prices, they
return to
individuals and institutions.
Bank
England started with convert¬
ing dollar balances — interestbearing Treasury securities!—into
ear-marked gold.
Other central
GOVERNMENT DEVELOPMENT
FISCAL AGENT FOR THE PUERTO RICO
P. O. Box
of
Company
could
desire
150
BUFFALO, N. Y. — William H.
Biesel is engaging in a securities
means
were
be free of such "nui¬
indulge to our
at
Street, New York City,
in a securities business.
to your
by a chronically fa¬
(current) balance of in¬
reserves, and
has
Inc.
offices
A|A
the
Uni¬
Charles Alan Co. Formed
recession
case,
the
of
Business Development Corp.
Before coming with John Han¬
have been prolonged.
•—debt monetization.
over?
slowed
reluc¬
adjusted to the
demand.
In any
the coming upturn is bound
to be accompanied by a cumula¬
tion of mal-adjustments.
It will
have to be supported by a massive
outpour of Federal Reserve funds
may
What would hap¬
Middle East pot should
ket:
In the retail trade,
manufactured products are
international
assistant treasurer in
economies, such as director of the National Shawmut
of
Boston/ Long* Island
they are. In the same chapter of Bank
"sobering up" belong the Presi¬ Lighting Company, Northern In¬
dential vetoes to stop some spend¬ surance Company and is an active
veloped under reasonably peace¬
an
as
institute
tantly,
if
:
.
freely Stack is chairman of the execu¬
it were, tive committee of the New York,
as
but announced that the
Note that this situation has de¬
ful conditions.
;
Mr. Stack joined John Hancock
subsequently
promoted
to
requirements was
and at this Vice-President and since 1954 has
also been a director. In addition torate is being
to 2%.
The his post at John Hancock, Mr.
right hand,
will
more
more
Stock
Defense Department spends
(at
problems, actual or potential, to
contend with. Not so, the United
States.
Backed by two-thirds of
the Free World's
(visible) gold
in the governmental house¬
hold
the
for
coast investment firm.
Iron Curtain has foreign exchange
it
on
public
raised
ecutive
invulnerable
stricken. Expenditures
panic.
than
sporadi¬
cally, letting interest rates climb
all along
the line. It has also
more
York
Every country
locked up behind
But the politicians became panic-
a
market
re¬
long-term
New
Sept. 1, it was an¬
by Lloyd W. Mason, ex¬
partner of .the coast-toon
postwar era under the assumption
Foreign Aid; the latter
cost us
some
$70 billion in 12
years' time. The dollar could take
of
bond
the
support
of the
By
implication, if not con¬
sciously, the American monetary
authorities operated through the
tion and in
sign
nounced
to
members
trouble.
markets.
no
(until
a
general partner of Paine,
Webber,
Jackson •&
Curtis, 25
Street,
New York
City,
Exchange,
fused
motion.
generates
John
Company, has been invited to be¬
by an immediate threat to its sta¬
bility. It comes from a side which
was
least
expected
to
cause
vorable
was
in
the
Insurance
trillion dollars!
one
liquidation; the growing inclina¬
tion
of
speculators to clear-up
commitments; and by the fact that
large segments of the population
were
being "priced out" of the
There
wrhile
a
price declines.
tations
Dollar's "Achilles Heel"
The
-
of
Life
Mutual
Misgivings about the future of
the dollar are greatly enhanced
from
conse¬
is,
life insurance and
claims — totalling
bond holdings,
that
The
America
what
is
savers,
acquiesce lightly to the dete¬
rioration
of
its
liquid savings,
actual
potential.
nation of
a
not
for the fantastic volume of output,
or
$280 billion, had
to
upped to $288 billion. And
of it, to
be
to
Hancock
Broad
monetization
set
Stack, formerly Finan¬
come
home
as
well
as
abroad), in turn causing gold out¬
flow
that
calls
for
more
debt
been
P.
Vice-President
time, the Federal Reserve has
A self-inflaming vicious
deficit
More
pen
$275
Lee
cial
have inflation for
money; the prospect of more in¬
flation sparks devaluation expec¬
should
national
the world's
richest country ran short of capital
to maintain a reckless pace of in¬
dustrial aggrandizement at rising
costs. The banking system's lend¬
overexpansion
pre¬
Paine, Webber Partner
one
the November elections?) and de¬
flation thereafter. >* In the mean¬
way
has
circle
the
By last November,
of
years,
impact is bound to be greatly en¬
hanced
by
the
nionetization,
flood of money outpour.
vices
for
continue
Lee P. Stack to Be
long boom had been held up. Pri¬
vate debts are mounting; inven¬
tory liquidation is slowing down.
Labor is scoring currently "sur¬
prising bargaining table gains,"
heralding a fresh turn of the
wage-price spiral. Raw material
output
fails to
contract as
it
should in view of the commodity
through
The truth of the matter is
there
not take financial
does
It
experts
—
nor
with massive
debts, was in the
of
that
clear
snow¬
no
depression,
balling
is up against
the paradox of managing by a
gauge the meaning of which is
policy
People could
emerged.
thoughts
second
mid-April,
The
practical purposes, one may
on rapid changes from: one
policy line to the other. We may
of bank credit, the
central bank monetizing a major
by
.
count
•
,
.
speedier contract allocations, more
deficit spending faster disbursed,
But
our
.
.
set its
economic system. Let lis
monetary hope that the public will awaken
are
caught on the to the threat of impending catas¬
nightmarish dilemma;-- trophe before it is too late.
For
.
,.
Contraction
and
objective requires
expansion; the other, contraction.
Both are mandatory.
were
.
a
Plus
fiscal
They must not permit uhemploy-i
ment to spread, or even to stay;
and they must not permit the in¬
cipient run on the dollar—on the
gold reserve—to grow much fur¬
re¬
plentitude of
a
23
(723)
4591, San Juan, Puerto Rico
BANK FOR PUERTO RICO
AQUEDUCT AND SEWER AUTHORITY
37 Wall Street, New York 5,
N. Y.
1
24
(724)
The Commercial and Financial
Chronicle
beneficiaries of foreign generosity without the
active, in¬
telligent and vigorous cooperation of the masses of the
nations to which the funds are given. Even the vast riches
of this country could not
possibly supply enough of the
good things of life to make a very great and lasting con¬
Continued from jirst page
As
We It
See
and unrest in all these
parts of the globe is traceable to
the deliberate incitation and
-successful
for
the
that
reason
the
waters
are
other way of
lies in their
already
Real
2000
such
In the presence of
imperialistic Russia such conditions
danger of international conflicts, even
catastrophic world war. They call for remedial or curative
action if and when
any such action is available. Any real
help will, of course, have to come from the anti-communist
these,
as
realizing
a
provide
Communists do not want conditions to improve
they take over, and are not likely to do very much
in the way of
helping them to get better. Their cure for
everything is surrender to the Kremlin. Western powers,
so-called, are now coming forward with programs which
is currently
This compares with an increase in
the average depth of wells of
of 11 cents
excess
Mcf. and has been increasing
per
must 'have very
in
candid study and analysis lest misunder¬
standing and false hopes arise which in the end will leave
rent contracts
matters
30%.
the range of 20 to 25 cents. How¬
substantially in recent
instead of better.
last week, and the other
comes
from
result of -the recent visit of the
Brazil, apparently
area.
He would draw
as a
market
will
We
gen¬
and the others
other regions.
are
now
making for the Middle
East and
Programs Have Limitations
basic
nature of these
and other
are
consumers
goods—moving from
one
nation to another in
any such way as this is a matter
wholly different from the natural international flow of
private funds in years gone by—such flows of
funds as
contributed so
States
largely to the development of the
United
during the 19th century, for example. Here is a
or schemes
which are
essentially state controlled
and state
managed. They more nearly resemble the
opera¬
tion of ifhe five
year plans of the Soviets than
they do the
older
scheme
international investment of
private funds. Decisions
to place funds into
this or that
type of endeavor are not
made by businessmen on
business principles, but
politicians on the basis of considerations which
or
nothing fo do with the economic success of
tion,
oreven its continued
existence
is at
once
by
have little
the opera¬
the flow of funds
an end. It is doubtful
if the world realizes
how social¬
istic the world bas become in
this as well as in various
other particulars.
In the second
'such schemes
as
place it is in
these
can
order to remark that no
at best do
very much for the
head.
high level of
a
the
hand,
one
ex¬
a
and
alternative
problem in which
term
reduce
industry have
major stake, and
a
relatively little
conflict
of
interest is
apparent. Under these
circumstances I am confident that
solutions
will
more
a
natural
gas
is
the
objective, as opposed to crude oil,
will increase. This raises the
pos¬
sibility that in the future a major
of
exploratory costs will
assigned
to
natural
gas,
as
will
cost
of
'
energy.
in
in
the
of natural gas.
in my
crude
oil
rary.
wellhead
There is
Pressure
tion
prices
of the
will
for
price
doubt
no
be
tempo¬
industrializa¬
so-called
countries of
"backward"
the world is increas¬
ing rapidly. Palmer Putnam has
developed a number of interesting
suppositions regarding the future
rate of growth in the demand for
tries, which I
vide
of
these
backward
am
coun¬
will
sure
who wish
a
ticular
Theoretically
gas.
have
those
instances
borne
to investigate this
par¬
subject further.
Most of
these countries may approach our
own level of industrialism within
the
the next four
except
cost
some
adopting
the
niques which
decades
ago where no market for natural
over
or
five
decades, by
production
we
have
tech¬
evolved
need
industry, to recognize the validity
of assigning some portion of cur¬
alleys before locating the avenue
of profits. It is also fairly apparent
exploration
and
production
costs to natural gas, and
with oil companies in
to work
developing
equitable procedure for such
gas
cost allocations, so that in
coming decades the same tech¬
niques can be utilized to assign
an
portion of costs to crude oil,
rather
than
treating
all
ex¬
ploratory costs as a charge against
some
out
Some
publicity
has
been
ac¬
was $22,000, and last
year it was
approaching $58,000. However, if
constant
effect of
these costs
in
terms
of
dollars, to eliminate the
inflation, the cost is up
only from $22,000
increase
of
,
automobiles
numerous
blind
of world energy
the major energy source for
that
such
backward countries will be
oil. This will surely be influential
in
creating
continuing
pressures
future.
amount
upward
oil prices during the
will
also
reduce the
on
It
of
oil available for
com¬
petitive purposes in this country.
in
to
$28,000,
the
17
an
years.
the
United
States
time, compared to 52 mil¬
lion
in
use
lons
used
in
1955.
per
car
Even if gal¬
should not in¬
crease, possibly because of more
widespread use of smaller auto¬
with
mobiles
'gines,-' this
efficient
more
would
-
-
en-
represent
a
300% increase in the consumptionof gasoline (or some alternative
fuel) for automotive use. In pass¬
ing
it might
of
rate
be
noted
increase
company
is
-
in the East is .examining
the economic advantages of with¬
drawing
completely
from
the
heating market, and using
refinery
capacity for other
home
its
.
»
of
All
declines,
the
are
you
with
familiar
production
in, coal
during the past , decade. In", the
heating market coal is vir¬
home
restricted to older homes
tually
have
which
not
been
yet
,
con¬
liquid
of home
verted to either gaseous or
preference
The
fuels.
:
purchasers for gas heating is il¬
most recent sur--
lustrated by the
of the U. S. Bureau of Labor
Statistics,
which indicated that
of all new homes used gas
vey
74%
heating, with the remainder over¬
whelmingly using oil. The dieselization of the railroads has been
coal-hauling
'
;
dieselization I has
savings
brought.
.
field of vessel propulsion, :
the
maintains
coal
and
the cost
accepting
fully
In
even
railroads are grate-
completed,
virtually
;
-
a
position of im- :
portance, but over the
long-term ,
vehicu-, •
future this is one area of
lar
utilization in which
atomic
make some inroads.
Accordingly, for fuel purposes, it
appears that the future of coal is
energy
may
exclusively to electric
tied almost
prices have shown the :
general long-term upward '
trend as oil and gas.
The coal \
unions have, under the leadership ;
of John L. Lewis, been unusually
same
perceptive in their timing of wage •
increase requests, All is peaceful *
and
when
serene
the market
for.
•
falling, but when ;
rising the frequency I
coal is static or
demand
and
is
magnitude of wage requests
correspondingly.
Further¬
rise
more,
employment in the coal in-
*
dustry has declined drastically in
as many
older
men
~
Furthermore, the agitation in have left the mines and the work :
foreign
oil-producing
countries has not become
sufficiently at- '
for increased
royalties will in¬ tractive to' stimulate young re- '.
crease, as these
greater
gradual
ural
the
countries demand
compensation
.
exhaustion
resources
pressure
of
for
the
their
nat¬
being used to foster
industrialization
countries.
of
fuel-poor
This additional upward
on world oil
costs will
be reflected
in
the
prices of do¬
mestic oil.
.Let me review briefly our pro¬
jections
of
the
amount
of
oil
^
26%
in
at that
recent years,
The average cost per well in 1941
state
pursue
Increased Royalties Abroad
to the fact that
explora¬
tory drilling is becoming substan¬
tially more expensive than it was
only a few years ago. At first
glance this is undoubtedly true.
we
Multiplying these projections of
per capita by estimated pop¬
ulation in the year 2000 indicates
that
there
will
be
200" million
Coal
to
to most students
natural gas.
corded
automobile
cars
long period of years, with¬
generation.
being handicapped by the
a
gas existed. It may be a wise step
for the long-term future of the
gas
rent
or
transportation, increases.
-
which
pro¬
interesting reading for those
natural gas as a by-product. Such
never
upon
and
suburban
Coal Hazard
mind that the demand for
energy
should
toward
necessary worker
demand
throughout the world is going
to increase at an extremely
steep
rate, so that any weakness in
opposed to the historical account¬
price of natural
and
,
oil
current
ing technique of assigning ex¬
ploratory costs to oil and treating
procedure would have signifi¬
cant implications in terms of the
trend
products which are either more
technological
.profitable or in which the comundoubtedly
deep drilling petition is less severe.
new
oil
As natural gas becomes
be
gas
any
higher posted prices for
oil, which is comparable to
crude
to
important source of revenue for
large
oil
companies,
it
seems
likely that the proportion of wells
portion
mark¬
toward
be
increases
where
a
and prices may have obscured
it,
there has been a
long-term trend
Gas
drilled
the
Although
evolved.
Assigning Exploration Costs
of
source
in the future.
the long-
over
seem-likely
impact upon
coal, oil, or
developments
hand. This is
of
per
upon
Furthermore
all segments of the
as
offset
quantities"
that inflation should have
the other
on
is
discovered
But it does not
than
on
complete exploration
similar procedures
location
prices at, the well¬
different
in
about the
definitely in order. In the first place,
they all take a leaf
from the notebook of
communism. Capital—to
say nothing
of outfcight
gifts of
inadequate drilling
costs
oil
Meanwhile, however, certain observations
of
re¬
competitively priced
"
increase
are
edly
encourage
,
furthermore,
larger
gas
will still permit natural gas to be
inspired by our Secretary of State, we have no
way of
knowing, but the President has let it be known that "we
areconsiilting now with our sister republics of this hemis¬
erosity, history only will reveal. Only
history can decide
what may be
accomplished by such plans as the President
the
as
that this
substantially
higher than the rate of growth in
net production of natural gas dur¬
ing the same period of time. To
yield
natural
gas
rather
than
briefly the favorable
crude oil. Inflation is undoubted¬ illustrate
ly the major influence creating position of gas within the com¬
increased drilling costs and high¬ petitive areas of the economy, I
understand
that
a
principal ,oil
er natural
gas
the
be
this
to
was
phere to strengthen its (organization of American
States)
role in economic
development." There is, of course, nothing
new in
principle in all this. We have been pouring out
our substance without
stint in
many directions since the
close of World War II—and for
supposed purposes rather
similar to what is now
being proposed. Whenever we have
been inclined to reduce the
volume of our gifts, we have
usually been labeled "Uncle Shylock"
by many who
shouldbave
been-eternally grateful for what he had done
for them. The ultimate
result of our efforts and our
limit
source
in¬
foot af formation at deeper
depths
due to higher pressures at the
bottom of the
hole, and because
higher proportions of the wells
pricing
also
of
natural
faced with the problem of
are
workable
not it
should
the
substantial
as
thought;
because
result
ploration
out of Brazil
or
will
major
a
that
seen
not
.
straddling a fine line on natural
gas prices which will be adequate
acceptable and are willing to put their own funds into
it, the United States would also contribute.
comes
much
in higher natural gas
because of the resultant
imbalance of supply and demand.
development institution"
now
It
is
generally
prices
proposal
A'broadly similar proposal
adopt-
which
for
membered that
Whose function it would be to "accelerate
progress in such
fields as
industry, agriculture, water supply, health and
education." Such an
institution, he thinks, should be
governed by the Arab states themselves, and he
gives as¬
surance that should the Arab
states find such a
and has to do with Latin
America. Whether
that _wells
more
a
the long-term these
will
revenues.
a
Arab
over
procedures
"regional economic develop¬
plan to assist and accelerate improvement in the
living standards of the people in these Arab nations." His
an
that
me
companies
ment
idea is *'to establish
inevitable
become
be
crease
in
exploratory costs at¬
tributable to the need for
deeper
important part of the operations
of major
oil companies in the
future, and it seems unlikely to
United States Secretary of
State to Rio de Janeiro. The
President, in addition to cer¬
tain (proposals of a
political or military nature, set forth a
plan *for the economic rehabilitation of the Middle
East,
supposedly the sine qua non of any quieting of the nations
of that
are
ever,
it
seems
natural gas will
Ttvo concrete proposals have come before the world
within the past week. One of them is that which the
Presi¬
dent-of^the United States
placed before the United Nations
It will thus
Cur¬
being written in
years.
automo¬
decentralization
rural areas,
Long-Term Outlook for Energy
—Including Natural Gas
1
nations.
605
higher living standards
opportunities for
and
factory
7
page
be
dependence
until
worse
will
industrial
jrom
cap¬
more
leisure
tend to increase the
Continued
per
seem far-fetched to
some, 1 think
it may be realistic as shorter work
basis will have been laid for real progress.-
a
cars
thousand people com¬
pared to 310 per thousand in 1955.
Although
this
possibility
may
of facts
sense
of
per
weeks and
to
one
trend of historical
a
of passenger
there
biles
saying that the salvation of all these peoples
hands. At best we can but
give them
comes
required in
ita, and extrapolate this into the
future, we find that by the year
own
When all the world
Help Only From the West
develop
we
ratios
measurable assistance.
troubled.
be
the principal noncompetitive areas
in this country—vehicular fuel. If
regions in question. Capital contributions would be of
great value only if effectively employed. This is but an¬
proselyting of the Kremlin
hopes to profit by the trouble it causes other nations
and other types of social and economic
organization, and
ultimately to rule the world, but these machinations are
Thursday, August 21, 1958
.
which will
tribution to the hundreds of millions of destitute in the
which
.
.
placements.
there
were
As receiitly
over
as
415 thousand
1950 :
em-
ployees of bituminous coal mines,
and in 1955 the total was only 210
thousand.
Since
coal
production
declined
only 10%
during the
same period, it is obvious that the
bituminous coal
'
•
»
•
industry has been
successful in achieving
at least .*
some gains in productivity.
However, the slow pace of de- >
Volume 188
Number 5770
velopment
of
.
.
The Commercial and Financial Chronicle
.
automatic
equip¬
mining
is
wellknown, and the huge machinery
required for efficient, operation
for
ment
achieves
coal
maximum
its
justification
coal
which
father
thick
in
than
deposits
becoming
are
those
thickness.
lesser
economic
of
In
of
scarcer,
average or
view of the
plants
would
eliminate
almost
Much
higher wage rates dur¬
ing periods of increasing coal out¬
put. ,it
seems ; reasonable
to
head
been
de¬
and
'
Even
plant
Bank and Insurance Stocks
cost
financing costs
may
from the
energy
*
r
By ARTHUR B. WALLACE
This Week
through the
lem
Washington releases, that the
of
be
dependability
assuming that an atomic
the same money per
that
weather
energy is a
also
seems
It
long period
proportion of cloudy
the country
time the
of
costs
of
drawback.
possible
We
over
a
throughout
are
beginning
—
a
hit
shortest
bottom
there
on
from
recovery
described
hear,
newspapers and from
has
cession
from here
to
and
what
re-
that
well be
may
had
been
the most severe,
as
business
yet
since
recession
KW of capacitj' as a fuel-powered may increase, as high levels of the war. Certainly, if we are on
Incidentally, some indication ofplant, and could achieve a zero industrialization and gasoline con¬ the way out of it, the set-back
importance of labor costs can
cost
on; fuel,
we
must keep in sumption by automobiles create may well be catalogued as a short
be realized by noting that minors
mind the relatively small propor¬ air pollution. One of our A. G. A. onepay
the
represented 50% of the
minehead
age
value
of
Many
•
people
thinkingly
coal
have
various
•
;
quoted
un¬
estimates
in
reserves
in
coal
77-
1953.
aver-,
of
this
country,
which stress their huge magnitude
compared to reserves of gas and
oil.
For those
tailed
interested in
de¬
a
analysis of why most coal
estimates
reserve,
overstated,.let
section
of
Palmer
beginning
cludes
are
on
that
to the
you
Putnam's
124.
page
of
seriously
refer
me
the
book
He
total
con¬
United
States coal reserves, only 10% are
recoverable
by
present
mining
methods
at
costs.
Electric
•
:
1
t
Let
that
substantially
^ v.
us
the
*
possibility
will
offer
price competition to nat¬
in the future. Such elec¬
serious
ural gas
tricity
Energy
examine
electric
present
.
•■■..-■V-
energy
power,
be generated by hydro
conventional fuels,
or
atomic
energy.
can
At
the
present
time
virtually all of the most
economically desirable sites for
hydro-electric development, par¬
ticularly when considered in con¬
junction with population density,
being utilized.
are
Accordingly it
does not seem
likely that elec¬
tricity generated by hydro-electric
tion which fuel represents of total
costs.
Furthermore,
research
people feels that various
types of plastics offer good prom¬
capital
costs of atomic energy
generating
stations
will
be
subject to the
same
tional
energy
speculating
concentrators
Analyses
future capital
sources.
upon
solar
a
construction
costly commodity.
storage problem is further
complicated by the possibility that
the
of
many
chemicals
might be used have
energy
accustomed to combating pressure
for
public ownership of energy
paper,
distributors,
but
solar
which
pressures
some
atomic generation
extent
which
exist
have
I
may
not
of
is feasible.
few concluding sentences
summarize
what I have at¬
to
tempted to review.
for
mand
in
gas
trillion
10.1
1955 to
The total
de¬
will increase from
cubic
34.8
feet
annually
trillion cubic
feet
Total remaining
in
rose
the
the
cumulative
de-
these
1957
New
the'same
June
loan volume of
York
banks
was
$12,081,000,000. This was an QVi%
shrinkage in volume, not a big
decline
when
set
alongside the
the
present
during
important fac¬
an
time.
1956
Furthermore,
production
costs
ag¬
gregated only 33% of total electric
operating
deductions,
revenue
while fuel costs amounted
20%,
tial
that
so
if
even
reduction of
some
fuel
to
only
substan¬
costs
could
be
accomplished, the competitive
impact would be minimized.
During recent
tric
utilities
absorb
would
the
the
haye
forces
they
years many
have
rate
been
elec¬
able
increases
to
which
or
by
because
inflation,
able to achieve signifi¬
cant cost savings in electric gen¬
were
eration
by
larger
and
using
plants.
in the electric
ulated
that
efficient
Many
people
industry have spec¬
fuel
ficiency factors
ing
more
conversion
are now
ef¬
approach¬
optimum
level,
beyond
which further improvement would
an
be extraordinarily difficult
future
will be
in
the
electric
joining the
gas
companies
regulatory
commissions
in
search of higher rates.
Atomic
it
would
more
complicated,
servicing problems
magnified substantially. I sus¬
pect
that
the
householder
would
demand
extremely prompt and
precise servicing on a unit with
the potential hazards inherent in
radioactive waste materials. Even
if
adequate servicing
avail¬
were
rate
of
foreseeable
no
make
about
factors
believe that the
me
tive
position of
coal
require ex¬
controls to
the controls become
as
are
re¬
sub¬
self-contained
complicated
the
at
one
trillion cubic feet per year. There
are
its output satisfactorily to
widely differing demands.
vary
meet
ing
occur.
household
'energy
any
unit
tremely
of
for
and
power
And
unlikely to
diversity
stantial
utilities,'
electric
place the hourly and
quirements
and
oil
preciably
will
to
compared
gas
during
which
competi¬
deteriorate
the
next
ap¬
four
decades.
I
seem
Atomic energy does not
to be a serious hazard to the
industry in view of its costs
gas
the
and
burgeoning
demands of
of all types.
13
the
volume
loan
compared
earlier.
of
only 8/10 of 1%
June 30 a year
with
Not
to
be
overlooked, of
course, is the factor of loan rates;
these
anoiner
another
while
lower
are
than, for
lacei,
facet,
loan
mai
that
anci
and
volume
an
But there is
a year ago.
is
inai
that
showing
was
only modest declines, U. S. Government obligation holdings have
increased sharply. Here the pertiains
centase
torn
over
vear
a
ago
June
30, 1958, run as high
for
Bankers, 82* for
foresee at least four decades of
segments
tions, with the industry becoming
the
population
from
As
of
some
us
expanding
know, the
very,
gas
industry
opera¬
dominant
as 'a
supplier
to the nation.
of energy
remote
possibility of hazard cre¬
by the use of gas already
ated
of
a
some
concern
small minority of our popu¬
Some idea of the furore
which
might
the
accompany
in¬
stallation of atomic equipment in
the basements of homes may be
DALTON, Ga.—Norris & Hirsh¬
a branch of¬
berg, Inc. has opened
fice
at
under
D.
106
the
South
Pentz
Street
management of Byron
Harris.
Mr.
Harris
was
for¬
Rankin, Inc.
construction
of
large
on
either
basis
loans if
enables
thus
reinvest
a
in
the
rapid
banks
roll-over
securities
has
in
or
demand for loan
the
commodation
Hanover; $7,677,000 for Chemical
Corn
Exchange,
remains
the
question
of
central atomic
within
shifting
stocks
ac-
good offsets to any
securities losses arising from the
A
standard
bulk in the future.
metropolitan
Many electric
companies, either individually
in
combination,
are
or
constructing
plants of various types and sizes
to
generate
fission.
As
electricity by atomic
an
optimum,
such
such
stations
areas,
excess
economically
hold
even
of
though
undoubtedly afford
safety precautions of
far in
distances
a
magnitude
of those which could
be
equipment.
used
on
house¬
&
Poor's
release
Commerce stated
flat the
btanaara & Poor s release
discusses inventories. ThQ,.flepart-
ȣ ^
rtTuartS?wasV5
quarter was $9.5
billion; and the President's Coun¬
cil of Economic Advisors said that
this rate
was
maintained through
the second quarter.
If bne of the
there cQ]^ .f motof Car
production increased, be a rush
to build up inventories.
In the
have
past several weeks there
indications
been
firming in rates.
have
we
seen
in bankers'
x
of
some
the
more
higher
average
increase in
an
\
com¬
These
rates.
paper
—
slight
acceptances, and there
also has been
mercial
of
Twice recently
announced increases
i
w
imi
i.
Pavements have been small, toRe
sure but it is possible that they
P°'.n' the way, and several bank
indicated to this
writer that they expect a firming
generally by about the
°f
2
be from
a
higher rate level than
at the start of the last
major
move
in interest rates.
This is
no
'
time to be bearish
on
the banks.
Vadman, Taylor Named
By Wm. P. Harper Soil
SEATTLE,
Wash.
-
—
Wm.
HarPer &: Sori & Corripariy, Incorporated, 1503 Third_Awenue,Uhnounce
that Willard B. Vauman
has been appointed Vice - President
charge of the municipal
department, and C. Arnold Taylo
improved.
substantial
from
in
the
,
trading de-
partment.
bank
volatile
equi¬
positions
of
to
ties that
Bradford Sees. Formed
are
than a year ago, and on
pay-out, when related to
Bernard
B.
DeiI'd\a.,D'
is
Brown
a
^
fices at 220 Fifth
engaging
JwSwSS
Avenu& N. t,
under the firm name of Bradford
Securities Company.
Combined Investing Co.
John J. Collins
is conducting k
operating earnings, continues low
at about 54%. There is thus room
for dividend increases, although
securities business from Offices at
under the firm
higher rates except the ex-
NATIONAL
150
Broadway,
Amalgamating National
TITLE GUARANTEE
& TRUST
Rothschild
&
Co., 120
Broadway, New York City, mem¬
bers
of the New York
Stock
NEW YORK
Head Office:
Bulletin
on
:
Request
13 ST. JAMES'S SQUARE, S.W.1
54 PARLIAMENT STREET, S.W.
1
Bankers to the Government In: ADEN, KENYA,
0OANDA, ZANZIBAR * SOMALILAND PROTECTORATE
Ex¬
change, announced that Leonard
M. Heine, Jr., has joined the firm
as
assistant manager of the spe¬
cial sales department.
CO.,
,
X BISHOPSGATE, LONDON, E.CJ
With L. F. Rothschild
F.
City,
of Combined
Investment Company.
bank of India Ltd.
and Grindlays Bank Ltd.
London Branches
L.
York
New
name
OVERSEAS AND
GRINDLAYS BANK LIMITED
generating stations
reasonable
of
.
well
turn out to be
-
There
how important atomic
energy will
others
and
lesser degree) that they could
Vice-President
the face
In
merly local manager for McNeel-
cities
to
($20,938,000 for
Manhattan; $9,178,000 for
Hirshberg Branch
realized by the opposition of many
Energy
and
date
to
any
Norris
in the minds
lation.
TheSe
of such size
were
chase
this department does not look for
even more
using such equipment.
par
advancing, the New
York City bank stocks are giving
possibility that solar energy a steady performance. Of course
may make some inroads on gas the principal reason is that wheredemands is a more distinct possi¬ as industrial earnings are off to a
bility, but one which cannot be considerable degree, and dividend
quantitatively evaluated at the cuts have been numerous, bank
present stage of the art. In short earnings are in a majority of cases
the nation for energy
I
of
at
another thing, matures
at a comparatively early
for
and,
The
able, the potential dangers would
undoubtedly discourage major
causes
industry
frequent trips to state and Fed¬
eral
first
daily
•
major research breakthroughs.
It seems likely that in the nearterm
the
In
with¬
out
and
think
profits for the six months.
gteel>
the
leading banks
city as of June 30, 1958,
reported an average contraction of
of
public
I
reported
securities
pusiness.
Indeed,
arguments
vs.
gas
but
are
been 'occasioned
of
private
banks
realized'
fhms'o/Sess" ma"y MWSM* pif," a " co^ldeSMe^VoTume3^
lines
regarding' reserves of natural gas are cur¬ as 80%.
responsibility rently 1,400 trillion cubic feet. Chase
tor in future incremental electric
Manhattan, 73% for Han¬
for such facilities may delay sub¬ These reserves will be
adequate to over, etc., for an average of about
production. With regard to elec¬
stantially the d e v e 1 o p m e n t of supply the increase demands of 48%.
tricity generated from
conven¬
atomic electric power.
the
economy
for
natural
gas
tional fuels, we have
already seen
It may be said that the weak¬
Some
people have speculated through the year 1990, at which
that the prices of coal and oil
ness in the government bond mar¬
time
some
supplementation
by
will continue to increase in the upon the possibility that the home
ket hits the banks whose holdings
future in a manner roughly com¬ of the future may contain an in¬ synthetic natural gas will be nec¬
have increased so much; but the
tegrated power source in the base¬ essary. In the year 2000 we will
parable with those incurred by
banks are committed in their buy¬
ment, utilizing radioactive wastes still have 462 trillion cubic feet
natural gas.
Accordingly, it does
of recoverable gas reserves in the ing of governments to relatively
to meet the complete
energy needs
not seem likely that such
plants,
short-term paper which, for one
of the house. Such an eventuality ground, although annual produc¬
will
achieve
any
significantly
would have major repercussions tion of natural gas from under¬ thing, has not suffered marketbetter competitive position than at
wise
as
have long-term bonds;
orn
the
ground formations will be declin¬
facilities will be
the
of
substantial
m?nt
in
example,
a
over-' in the year 2000.
occur
collectors
Summary
Just
of energy. While
confidence that men
of
and
reducing
and
sources
this
power,
energy
•
good judgment will prevail, and
they will recognize the advantages
of private developments of atomic
night
economical
for
substantially greater than for al¬
ternative
an
the development of effec¬
tive and
to
of electricity is
loans
total
residential
At the June 30 statement date a
number
stated
$268,000,000 to $11,053,000,-
As of
.
1957
increased
business
000
inadequate
were
extremely bright, and if life expectancy, thus greatly in¬
some significant cost
savings could creasing operating costs. Dusting
be effected, we still have political off our crystal ball
again, it does
problems.
The utility industries seem
possible
that
within
the
through the years have become period of time covered by this
the
that
far
re¬
paid for the
were
year-end.
that bad bond market at this juncture.
$82,000,- And, unquestionably the? banks
preceding week; and it are still carrying bonds that we're
was
only as recently as June 30* acquired at even lower levels than
when the same source reported those now
ruling.
week
considered
Friday, Aug. 8, of
Reserve
loans
date
future
Bank Stocks
tras that
000 in the
storage is that all
so
costs, space is
electricity
atomic
Federal
$741,000,000,
The
regarding inflation is used.
Even if the future of
to ef¬
The release of
of
realistic assumption
from
and
quire large amounts of area, and
under any reasonable
assumption
to determine whether they
discussing cost in constant
dollars
(as they usually do) or
are
generated
of
energy
procedures
fully
some
collectors
One additional drawback
ficient
costs,of atomic generating stations
should always be scrutinized care¬
whether
efficient
factors
those
as
business
for
radiation,
during but he is less optimistic regarding
using conven-' the prospects for storage.
inflationary
the future
the
ise
the
*
~—1
sun
energy
is most serious since absence
major
'
.
===
and storage
for use during
cloudy periods. The storage prob¬
such
of
eliminated.
as¬
has
op¬ voted to the
possibility of utilizing
savings.
However, solar energy as a source of heat
the
excess
capital
cost
of
an for all household
purposes. As yet,
atomic
generating station com¬ however, no reasonable economic
pared to one fueled by conven¬ procedures have been
developed
tional
materials,
will
probably to permit effective collection of
tion
that upward trends in mine-"
costs of coal will continue.
sume
discussion
effecting relatively important
erating
?5
Solar Energy
completely the cost of fuel, thus
more than overcome the
operating
inadequacy of labor supplies, the cost savings at least within the
relatively slow development or near-term future. For more dis¬
automatic mining equipment, and tant
years the picture may change
the probable continuation of de¬ and some of
the excess construc¬
mands for
(725)
Branches In:
TCHA, FAR 1STAN, CEYLON, BURMA,
Members New York Stock Exchange
Members American
Stock
Exchange^
120 BROADWAY, NEW YORK 5,
KENYA,
TANGANYIKA, ZANZIBAR, UGANDA.
•
Laird, Bisseil & Meeds
Telephone: BArclay 7-8300
Bell
Teletype—NY
1-1248-49
ADEN, SOMALILAND PROTECTORATE,
NORTHERN AND SOUTHERN RHODESIA.
Specialists in Bank Stocks
N. Y.
26
The Commercial and Financial Chronicle
(726)
of Reason in the
17
Continued from page
ing
Inescapable
The Rule of Reason Is
Two
passages
the
in
Supreme
preted, it is not unlikely that in
Court's opinion
in Socony-Vacthe conference stage of Trenton
uum raise serious questions of in¬
Potteries Justice Brandeis might
have been able to suggest, and a terpretation:34
The first passage may be inter¬
majority of the participating Jus¬
tices might have been willing to preted as saying that "the Amer¬
in
course
the
whether
review
those
of decid¬
conduct under
did
cases
or
not violate the antitrust laws.
applied
Court
that the Rule of Reason as
se/'
whether the antitrust act forbade
permitted
or
review the
not
so
the
under
conduct
determining factor was
illegal¬
much these "per se
in Standard Oil and American To¬
If
the Supreme Court means bacco.
American that these two passages must be
In Columbia Steel and TimesTobacco is inapplicable to price- interpreted literally, how can the
Picayune, reasoning in the style
Court explain the 45 pages early
fixing.29
:• ; *
of the Rule of Reason, when used
in its opinion,33 and the 18 pages
and applied on charges of "per se
"Per Se Illegality" Approved
later in its opinion,33 which the
illegality," disproved the charge
In May 1940 the Supreme Court Court devoted to copious discus¬
of "per se illegality," and also dis¬
in SowKU-VasiLum30 reviewed sion of the facts and the law in
proved the charge that the law
buying programs in which a num¬ Socony-Vacuum, in exactly the haci been violated.
ber of oil companies selling about style of the Rule of Reason as the
Emboldened by Columbia Steel
*13% of all gasoline sold in the Court
applied
and. used it in
and Times-Picayune, several lower
.Mid-Western area were charged Standard Oil and American To¬
•
'
court
Judges after 1953 began to
maintaining bacco?
voice dissatisfaction with the "per
Blind Alley
prices by buying up "distress gaso¬
se illegality" doctrine as stated in
line" on the "spot" market51
If the Court is prohibited from
Socony-Vacuum in 1940, and to
Early in the Supreme Court's applying and using the Rule of
express their preference for
opinion in Socony-Vacuum the Reason, or reasoning in the style
Court
devoted 45
pages
to an of the Rule of Reason, how else weighing by the Rule of Reason
the available facts relevant to the
analysis of the facts in the style can
the
Court
ever
determine
with raising and
of the Rule of Reason.32
;
whether the conduct under review
,
These pages
would have been a
background for a Su¬
suitable
Court decision that would
buying program, in So¬
preme
is
is not
or
ment
or
a
some
price-fixing agree¬
other "per se ille¬
gal" conduct?
the
hold
plain violation of
as
interpreted
by the Rule of Reason according
as the Supreme Court applied and
cony-Vacuum
a
the
Act
Sherman
used the Rule in Standard Oil and
American Tobacco in 1911.
But
instead
following
of
this
course the Supreme Court decided
Socony-Vacuum
squarely
upon
the doctrine of "per se illegality."
Socony-Vacuum thus illustrates
two
truisms
which
the
conduct
Court emphasized in Standard Oil
review,
as
so
to
adjudge
thereby whether the
Sherman Act forbade or permitted
that purpose and effect.
In
in
1957
National
Screen
Service41 the Supreme Court took
a
First, it is utterly impossible
to interpret and apply the Sher¬
man
Act without using the Rule
of Reason and applying it to the
under
ascertain the over-all purpose and
effect
of
that
conduct, and to
Supreme
and American Tobacco in 1911:
step in the direction of warning
court
Judges to proceed
lower
judgments based on the "per se
illegality" doctrine, and in the
facts and
circumstances of each direction
of
encouraging
lower
case,37 and
court
Judges to exercise their
Second, as the Supreme Court sound discretion to weigh with
remarked in Standard Oil with reasoning in the style of the Rule
Reason
the ^available
facts
respect; to Trans-Missouri Freight of
Court's opinion in Socony-
preme
Vacuum, the Supreme Court re-'
ierred obviously to Trans-Missouri Association in 1897 and Joint Traf¬
Freight Association in 1897 and fic. Association in. 1898, the. Su¬
Joint Traffic Association in 1898 preme Court sometimes has
ap¬
in this remark:33
'
.
"Thus
for
Court has
*
out
-
p r
deviation
i
n c
i
c
40
years this
consistently and with-.
over
1
p
e
agreements
adhered
to
the
rthat price-fixing
unlawful per se
are
under the Sherman Act and that
*
relevant to the conduct under
view, So
all
as
to ascertain the
and
purpose
effect
re¬
over¬
of
that
plied and used the Rule of Reason
conduct, and to adjudge
in the very
Court
was
whether the Sherman Act forbids
decisions in which the
denying
the
Rule's
existence.39
,.
Clearly
opinion
in
overruled
considerable
permits that
or
-
the
Supreme
Court's
Socony-Vacuum
has
In
1957
in
purpose
New
Exchange42
ance
was
a
private
thereby
and effect.
Orleans
the
Insur¬
defendant
association of
130
insurance
agencies which con¬
no
trol 1 e d
showing of so-called com- the pre-existing law.,
approximately three*
petitive abuses or evils which
This raises the very pertinent fourths of the fire, casualty and
; those agreements were designed'
surety insurance business iti the
question:
•
New Orleans area.43
f
to eliminate or alleviate may be
How much territory has really
1 interposed as a defense "
The
Government
been lost to the Rule of
charged the
Reason,
; Here by an out-of-hand gen¬
and how much territory has really defendant with a "per se violation
eralization the Supreme Court in
been gained by the "per se ille¬ of the Sherman Act" by maintain¬
Socony-Vacuum
reinterpreted gality"
doctrine, because of the ing a group boycott against all
over 40
years of its decisions in
Supreme Court's opinion in So¬ nonmember insurance agencies as
price-fixing cases as deciding that cony-Vacuum?
well as against all insurance com¬
all
price-fixing agreements are
panies which do not plant ex¬
"unlawful per se."
Doctrine Fosters Lip-Service
clusively through Exchange out¬
a
part of
•
Two members of the
not
Court did
of
Socony-Vaeuwn, Justice Murphy because he
was Attorney
General while the
case
was
pending, and Chief Juslice Hughes because some of the
Socony-Vacuum defendants had
been his clients while Chief Jus¬
tice Hughes was in private
practive in New York from 1916
to
1930.
Justice
McReynolds and Justice
Roberts who dissented from the
Court's opinion in
Socony-Vacuum
Expressed
no dissent
regarding the
Court's discussion of
"per se ille¬
gality."
Justice
from
the
Brandeis
active service
year
came
before
had
in
retired
the
Court
If
Chief Justice Hughes
and
Justice Brandeis had been able to
participate
and
in
decision
the
of
consideration
Socony-Vacuum,
they undoubtedly would have vigorousty contested numerous pas¬
sages in the Supreme Court's
opinion in Socony-Vacuum.
If
.
....
-
After
cided
u.
.
Socony-Vacuum was de¬
in 1940, a number of Su¬
Court decisions discussing
charges of price-fixing agreements
and
other
"per se illegalities"
demonstrated in a variety of ways
that
notwithstanding the Supreme
Court's use of "per se illegal" and
other "per se
illegality" cliches,
the Court placed great reliance on
weighing by reasoning in the style
preme
members.44
District
that
Act, but refused to base its deci¬
sion
the Government's conten¬
on
tion that the bylaws "constitute a
per
se
violation
of
the
Sherman
Act," stating that "it is not neces¬
sary to decide this case on a per
basis.
se
Tl)e rule of
tates that this
must be
reason
dic¬
destroyed."43
trict
judge thereby whether the Sher¬
Exchange 49
man
Act forbade
or
Between 1940 and 1953 the Su¬
Court used the term
preme
se
"per
illegal,"
"unreasonable per
"per se ille¬
gality" cliche in at least a dozen
se"
or
antitrust
in
or
some
other
cases,
but
nevertheless
the
Court's opinions in those
the Supreme Court devoted
total of at least 236
cases
a
pages
to
New
Orleans
Insurance
Exchange the Supreme Court in
1957 affirmed Per Curiam the Dis¬
permitted that
purpose and effect39
the
Court judgment against
the
Thus in New Orleans Insurance
using
the
reasoning
Rule
decision
"per
a
in
the
Reason
of
style
in
in which the
the
of
same
Court
uses
Northern
Pacific arose out of
grants which Congress made
in 1864 and 1870 to the. defendant
of
the
Dis¬
Court
for
expressing
its
with the "per se
illegality" doctrine, and its pref¬
erence for
weighing by the Rule
dissatisfaction
of Reason the available facts rele¬
vant to the conduct under
as
pose
and
review,
to ascertain the overall
pur¬
and effect of that conduct,
to
adjudge
thereby whether
,v\:_
Nothing in Northern Pacific,
therefore, indicates that the Su¬
Court is likely to discon¬
slacken its practice - of
preme
tinue
or
supplementing its use of "per se
illegality" cliches by applying and
using reasoning in the style of the
"per
a
illegality"
se
Thus
where
started, and to what
(!) hereinabove in this
of
a
what
the
we
stated in
was
to
construction
deciding
case.
return-to
we
facilitate
the
Started
We
to Where
Railway's preeedessor in order to
paper,
and
Supreme Court said;
railroad line from Lake Superior
in 1911 in Standard Oil and Amer¬
to
ican Tobacco.
Puget Sound.49
The Rule of Reason is really
comprised approx¬
only applying and using sound
imately 40 million acres of land,
in several States and Territories, judgment and common sense rea¬
most of
which thereafter were soning in interpreting and apply¬
sold or leased under "preferential ing the Sherman Act to conform
to the currently authoritative in¬
routing" agreements requiring the;
terpretation of: the Act, so as to
grantee or lessee to ship over the
ascertain what the - Act forbids,>
defendant Railway's lines all com¬
and what it permits; and
modities
produced
These grants
manufac¬
or
No matter how many "per se
land, provided the
defendant Railway's rates (and in illegality" cliches we use, and no
matter what we say or think we
some instances its
service) \vere
equal to those of competing car¬ are doing, the generality of lan¬
riers.49
guage in the Sherman Act makes
it impossible for us to interpret
The District Court and also
tured
the
on
the
Supreme
cific
Court
that
held
routing"
in
Northern
the
"preferential
agreements
reasonable
"un¬
were
se,"
per
Pa¬
but
both
enforce the Sherman Act unless
or
apply and use the Rule of Rea¬
or reasoning that is in the
style of the Rule of Reason.
we
son,
Courts supplemented their "per se
illegality" cliches with reasoning
in the style of the Rule of
Reason,
in
which
they reviewed many
Supreme Court decisions regard¬
ing
"tying
arrangements,"
and
also
reviewed
the
terms
of
the
"preferential routing" agreements
in, Northern Pacific, and their
number and extent, and their ap¬
plication and effect, so that their
overall
and
purpose
effect
were
amply discussed 30
Northern
:
Pacific
Court said:31
.
there
.
ments
the
.
.
practices which because
pernicious effect on com¬
petition and lack of any redeem¬
ing virtue are conclusively pre¬
or
sumed/to
be
unreasonable
and
therefore illegal without elaborate
inquiry
to
as
the, precise
tliey have caused
ciple of
per
only
straints
benefit
This
prin¬
unreasonableness
se
which
the business
use.
makes
the Sherman
the
or
for their
excuse
harm
the
are
Act
type of re¬
proscribed by
more
of
certain
everyone
to
con¬
Co.
U. S.
U.
V.
S., 221
Tobacco
American
v.
U. S.
U. S. 106 (1911 >.
2 Standard
Oil, 221
U. S.
Tobacco, 221 U. S.
American
131.
3 Standard
1,
59-68;
106,
'
'
.
,
178-
said:
"It
opinion
from
of
in
the
use
that
It
resorted
be
not
of
decided
was
determining
for the
to
the
within
the
also
character
that
whether
were
however,
of
the
purpose 7
acts
com¬
It
statute.
that
true
the
contract
nature
or
agree¬
case
was
fully referred to
as
to
their unreason¬
pointed out in order to indicate
that they were within
the prohibitions f
of the statute.
As the cases cannot by
ahy
possible
conception
be' treated as
and
suggestions
ableness
authoritative :without
reason
of
of
that
course
by
the
light
clusion
that
agreements
the
of
matter
held
con¬
otherwise
contracts
the
or
general
that
and
statute,
brought about
effect
which
trade
purpose
a
been
the
since
assailed
within
the;
operation and
restraint
as
been
have
the
of
the
have
must
were
enumeration
their
it
not
that
certitude
for
to
follows
of "reason,
could
reached,
the
resorted
was
deciding them, it
the
statute
prohibited." <64-65) Continuing the Su¬
preme Court referred to "the many cases
cerned, but also avoids the neces¬ decided" before Standard Oil and said:
sity for
an
incredibly compli¬ "every one of these cases applied the
and
prolonged
economic rule of reason for the purpose of deter¬
mining whether the subject before the
investigation into the entire his¬ court was within the statute
as
we
tory of the industry involved, as have already pointed out, unaided by
.
related
as
effort
to
whether
industries, in
determine
large
particular restraint has
a
been unreasonable—an
often
at
an
wholly
fruitless
inquiry
when
so
the
un¬
light
of
understand
future
how
Referring
stated
Court
in
in
thus
the
that
fact
sometimes
the District Court
some
legality"
uses
cliches, viz.
able per se" (three
Pacific
"per se il¬
"unreason¬
times), "illegal
se" (once), "violations per se"
(once), "illegality per se" (once),
"unreasonable
and
restraint
(once), and six times in the
Supreme Court's opinion in North¬
ern
Pacific
uses
"per
se
se
the Supreme Court
illegality" cliches, viz.
unreasonableness"
times), and "unreasonable
(twice).32
But apart
the
two
(four
per
se"
and
this
U. S.
the doctrine
with
and
the
Supreme
Supreme
Court,
Court
applied
and used in these two opinions, in
the
course
of
deciding that the de¬
was
attributed
was
U.
171
a
S.
mistaken
505).
one
was
to
That
fully
..
(179).
4 U.
U. S.
290
5 U.
171
S.
U.
v.
v.
S. 505
"the
which
is
Association,
166
(1897).
S.
6 American
180
Freight
Traffic
Joint
Association,
(1898).
Tobacco,
standard
of
universal
U.
221
the
in
rule
S.
of
106,
reason
its
application".
This phrase occurs in the context of the
following sentences: "The soundness of
a
that
rule
reasonable
the
statute
should
construction,
deliberation,
we
see
after
no
quoted doubt.
Indeed,
the
necessity
opinion departing in this case from the
in Northern Pacif ic, practically the of the rule of reason which is
in its
application is so plainly
entire two opinions in the District
in order to
the
the
despite
contrary^ view
from the Supreme Court's
and
all
court,
used in two prior
Trans-Missouri
Freight
Joint Traffic cases, 166
and
290,
view
mature
above
of
Reason
Supreme
221
pointed out in the Standard Oil Case
the
from these cliches and
sentences
say
accord
erroneously
(the
U.
per
se"
"We
in
the
Association
S.
of
the
Oil,
Tobacco,
the expressions
of
decisions
such
to
may
in the
public policy
Rule
the
American
was
the
be made efficacious".
to
decisions
previous
statute
Standard
stated
impossible
is
and
106, 179 remarked:
This is pretty fervent language,
and seven times in the District
per
the
it establishes
(68)
it
reason
enforced
be
which
as
dertaken."
,
reason
each
in
ment
that
each*
case
general
language
of, which, when separated
context, would justify the con¬
its
and
221
undoubted
is
in
made
was
Oil,
cated
well
■
■
U. S. 1, 64-68. "
Referring to "the Freight Association and
Joint
Traffic cases", the Supreme Court
plained
agree¬
Oil
and
<1911 )
is,
certain
are
Su¬
."
of their
not
1
Co., 221
could
In
preme
'
FOOTNOTES
1 Standard
clusion
comprising approximately five
double-column pages in the Dis¬
trict Court opinion, and approxi¬
mately ten pages in the Supreme
Court, opinion, are devoted to rea¬
soning in the style of the Rule of
Reason, which the District Court
so
Return
the
Court
approval
"preferential
violated the
Rule of Reason when it is
illegality" cliche?
se
dicated
trict
contracts
Backwards Seen
Exchange the Supreme Court in¬
its
Railway's
routing"
practice of applying and
"per
illegal combination
On appeal to the Supreme Court
by
fendant
Court's opinion in Northern
held
Court
this boycott violated the Sherman
the Rule of Reason "the avail¬
able facts relevant to the conduct
that was under
review, so as to
ascertain the oter-all
purpose and
effect of that
conduct, and to ad¬
reasoning in the style of the Rule
•
or
The
of
Socony-Vacuum
to the Supreme Court.
lets
Cliches
participate in the considera¬
tion and decision
Court's
with caution in ordering summary
•
j't Closing this branch of the Su¬
per¬
Thursday, August 21, 1958
.
Sherman Act.33
No Step
;
and
Oil
or
and effect.
Does Northern Pacific47 which
Notwithstanding the use of "per
se
illegality" cliches throughout the Supreme Court decided on
the Supreme Court opinions, it is March
10, 1958 indicate a dis¬
impressive that in determining continuance or slackening of the
used by the Supreme
Standard
in
Act forbade
did
accept, some sentences and para¬ ican Tobacco and Standard Oil ity" cliches a3 it was the over-all
cases"—that is, the Rule of Rea¬ purpose and effect of the conduct
graphs that might have changed
Justice Stone's draft opinion lor son—can "have no application to that was being reviewed.40
combinations operating directly on
The search for this over-all pur¬
the Court, and might have pre¬
price structures" e.g. pose and effect dominated
cluded the possibility that anyone prices or
thereafter
reading
the
Court's price-fixing agreements.
throughout these decisions, and
The
second
passage
may
be copious pages were do voted to dis¬
opinion could derive the impres¬
sion that in Trenton Potteries in interpreted as saying that "illegal cussing the facts and the law, with
1927 the Supreme Court had de¬ per se" means that the Rule of reasoning in the style of the Rule
cided that all price-fixing agree¬ Reason can never be applied to of Reason, just as the Supreme
ments are "per se illegal," and any conduct that is "illegal per Court applied and used the Rule
and
the Sherman
mitted that purpose
.
.
purposes
receive
further
reason
to
for
not
standard
universal
required
give effect to the remedial
which the act under consid¬
eration contemplates, and to prevent that
act
from destroying all liberty of con¬
tract and all
substantial right to trade,
and
thus
causing the act to be at war
by annihilating the funda¬
of freedom to trade which,
on
the very face of the act, it was en¬
acted
to
preserve,
is illustrated by the
with
itself
mental
right
record
before
us".
7 Standard
American
Oil, 221 U. S.
Tobacco, 221 U. S.
1,
59-70;
106,
175-
184.
8 Standard
Oil,
221
U.
S.
1,
49-70;
Number 5770
Volume 138
American
Tobacco,
U. S.
221
106,
The words "and the Supreme
181.
The Commercial and Financial Chronicle
...
whether a particular price is reasonable or unreasonable as fixed and without placing on the government in enforcing the Sherman Lalw the burden of
ascertaining from day to day whether*.
it has become unreasonable through the
mere variation
of economic conditions,
Moreover, in the absence of. express legislation requiring it, we should hesitate
175Court
the currently authoritative interpretation of the Act" are
important. Over the years the Supreme
Court's interpretation of- the Act changes,
and these changes are binding and must
be, heeded in every application and use
decisions
the
of
containing:
of Reason.
Rule
9 Standard
Oil, 221 U. S.
Tobacco, 221 U. S.
American
175,
upon
so
uncertain- a test
prices are reasonable—a
j..
10 For
limiting powers of the monetary authorities are at
again, because they believe that now is the time to start a
program to slow down, if not stop, the forces of inflation which
appear to be gaining some momentum.
The increase in margin
requirements, and the more recent increase in the discount rate,
madeoX
purpose
.
effect
the conduct under review the
determining factor is not
per se illegality" cliches, but is the over-all purpose
permits
and
effect
reviewed.
;
that
conduct
the
of
decisions
cases,
does
que8tion
cided
11 Standard
Oil, 221 IT. S. 1, 58, 64,
65; American Tcbacco, 221 U. S. 106,179.
13 Standard
.
Oil,
S.
U.
221
58,
1,
65;American Tobacco, 221 U. S. 108,
-
14 Standard
76,
77
lofi
106,
179
179,
181,
Tobacco,
ing
76.
U.
221
178
S.
«
c.
.
j
17 Standard
'IffStandard
en
i
U. S. 1, 67..v
Oil,
WILLIAM
25 Standard
Oil
U. S. 1, 67.
and
S.
U.
221
65,
1,
in
14;
74,
15,
HOWARD
order
in
allow
4o
the
statute
true,
the
rulings
that,
(1939).
prohibited. This
in the cases re-
203, 204, 210, 212,
straint
in
considering the contracts or agreements,
their necessary effect
and 4he
character of the parties by whom they
were
made, they were clearly restraints
of
the wisdom
sta*ftte
decided
the
of
or
of wisdom of
want
that
the
contracts,
conclusive
them withm
and
nature
_
40 See
the
law
it
as
of
26 Trenton
in
v.
,
fix
or
maintain
prices
are
not
concept
a
definite
of
and
unchanging content. Its meaning necessarily varies in the different fields of
the law, because it is used
as
a
con
venient
summary
of the dominant con
siderations which control in the applicaof
tion
what
is
merce
reasonable
a
controlled
is
Our
doctrines.
legal
view
restraint
the
by
of
•
.u
■
-
there
to
the
of
an
for
Service
C*urt
thc
■
v.
915
Insurance
.
gupp.
915.
Exchange,
ExchanSe>
Exchange
91&-919.
'
,
_
*'
■
M
...
,
Exchange,
V*
*
*
Pacific, 356
.
v
_
U.
S.
...
1.
_
2-3.
.,
50 U' S'
Northern Pacific Railway
Supp. 679, 681-685.
|J>* 1W. _P* Washington, N.
1956),
Northern_Pacj/icR. Co. v. U. S., 356
1.
'
,
..,
1
119581.
51 Northern
Pacific, 356
52 Northern
Pacific, 142 F. Supp. 679,
...........
.......
682-684, 356 U.~S.
2-684,
U. S.
..
c
U. S.
1,
in this
...
the
above
1%
earlier level.
On
(3)
entire
year-
,
ownership basis, the
an
gain in contracts for future
construction
far this year has
so
resulted from high levels
of pub¬
year
/
Trends established by mid¬
indicate that the a.hhu.al
totals for
1958
welh exceed
may
much
more
for
continue to sell Treasury bills and
the excess reserves of the member banks would be
This could, however, have a retarding effect on the
.
Releasing details of; Dodge con¬
ordinarily
made
view stated
crease
the re¬
that the greatest In¬
single building type
in any
occurred1 in
figures hot
public,
public buildings, with
contracts in this class 71%
ahead
of last year.
i
Notable increases were also re¬
corded
in
public
works*, apart¬
business recovery which is still not too vigorous in spite of the
ments, hospitals* electric light1 and
improvement which is in evidence in the various economic ba¬
power,
and recreational buildings.
rometers.
Equity Market Unaffected
The
tightening of the money market by the powers that be, is
reportedly a move to check the forces of inflation, and certain of
the indicators that are supposed to be a measure of the flight from
the monetary unit, such as the stock market. The recent increase
in margin requirements from 50% to 70% was aimed directly
at the equity market but, so far, it has had practically no effect
142 F. Supp. 679,
.
Specialists in
U. S. GOVERNMENT
its upward trend.
On the other hand, the market for Govern¬
ments and all other fixed income bearing obligations have been
adversely affected
powers that be.
very
the
inflation restraining
moves
and
of the
FEDERAL AGENCY
681*685» 356 U. b. 1, 2-12
u
^
be
may
among
economists
as
SECURITIES
Ellison Sees. Opens
Form Leo Hershman Co.
desirability
competitive system,
economic
Ellison Securities Company, Inc.
,
j
*£•
Hershman &
Leo
Co., Inc. has
MIAMI, Fla.—George Coury is
engaging in a securities business
Broadway, New York City, to en¬
from offices at 96 Northeast Sec¬
been
gage
formed
Federal In v. & Trading
Morris Giloni has formed Fed-
George Coury Opens
42
x
H3S been form6d with 0ffiC6S 3t
37 Wall Street, New York City, to
en®»ge in a securities business.
and
social
unrestrained
tion.
in
a
with
offices
at
securities business.
ond Avenue.
are:
the
...
"The
aim
and
result
of
every
price-
eraj
Investing
&
Trading
SS3LJSTT°£i L?S*,pany, Inc. with offices
The
power
to
fix
sonably exercised
to
way
wiped out.
on
5.
57*8-11.
5, 8-11.
1,
63 Northern Pacific,
___
was
psychological purposes, rather than to stop the discounting of
eligible paper at the Federal Reserve Banks since the volume of
member banks borrowings from the Central Banks is and has
been small. Also the fact, that the member banks of the system
have free reserves, means that there will not be a pick-up in their
borrowings from the Federal Reserve Banks.
To be sure, the
"• ' (19581.
....
_
building
apartment
pushed residential
struction contract
'
48 Northern Pacific, 356 U. S. 1, 2-3.
49 Northern
demand for
tinued
_
-
38®
t
Renewed activity in single-
(2)
(4)
psychology that is generated.
This recent rise in the Central Bank rate
U. S., 355
Insurance
gineering category.
of inflation
based upon the assumption
public interest is best protected
from the
evils
of monopoly and
price
control
by the maintenance of competi¬
it
that
system are still in the neighborhood
Federal Reserve Banks could
£1*
increase
public works and the heavy en¬
the record levels? of 1957.
of
916
Orleans
in
is over and one of restraint is to be expected in the
money markets.
The extent of this restraint will depend in no
small measure upon the future course of business and the amount
'
,
Insurance
com-
L.wX"d.£
ing
of the
$500,000,000.
the
to
cases
the greatest boost to the
gram of ease
trial,
Orleans
*T
Sherman
Law itself.
Whether this type of restraint is rea¬
sonable or not must be judged in part
at least in the light of its effect on com¬
petition, for whatever difference of opinion
re¬
Late
the
of
purpose
and
Supp. 915, 916*918.
p
353
of
recognized
recession.
Policy bf Monetary Restraint Indicated
(1957).
s
45 New
rea-
by the statute, merely because the prices
themselves
are
reasonable.
Reasonableis
22
F
148
sonable restraints and thereiore permuted
ness
Court
iA3ea
F.
prohibited by the Sherman Law was the
rule la<d d«wn by the oninions of this
Court in the Standard Oil and Tobacco
cases.
But it dees no* follow that atrreeto
Court
_
148
273 U. S 392
Cuurt said:
That
only
those
restraints
upon
interstate
commerce
which
bre
unreasonable ' are
ments
DUtrict
43 New
14g
.
ooa7J^Qr,if'rfcn
the Supreme
the
U. S.
300
»
396-398
business
/
lic construction.
42 U. S. v. New Orleans Insurance Ex<han8e'™8 f' SuPP- 91^ (D. C. E. D.
^a., 1957), affirmed Per Curiam in New
Orleans Insurance
C. A. 20, 1924), reversed
Trenton Potteries, 273 Us S.
(1927).
the
The upping of the discount rate gives confirmation to the
recently initiated policy of the monetary authorities that the pro¬
Screen
Exchange
U. S.
178-
hereinabove.
National
v.
._
(C.
S.v.
U.
392
Co.
9
note
District
Oil, 221 U. S. 1, 60-62,
U. S. 106,
Potteries
change in credit policy from
'
The highway program gave
buildings,
U. S. 1, 64-68.
'
Appeals, and remanded the
68-70; American Tobacco, 221
179-183.
Fed. 550
a
combat
WV
the- following
notes
family houses, combined with con¬
of
Per Curiam granted the petition
for certiorari and vacated the
judgments
made."
was
106,
to
(1)
first reduced from
January the Central Bank rate w\as again reduced to 2%%;
a 2]A% rate approved in
March; and the 1%% rate was made
on April 18.
Along with the successive lowerings of the
of the member banks
61-68;
a. Court
a judicial
appreciation of what the Jaw
ought to. be for the plain judicial duty
enforcing
•
-
1,
order
was
Edwin
economist,
highlights:
short period of time, since it
However, with the trend of business showing signs of im¬
provement, the Federal Reserve Banks have recently been sellers
of Treasury bills, although these sales of Government obligations
has not tightened the money market too much since free reserves
Corporation, 238 F. 2d (C. A. 3C., 1956).
,n 3S2 U. S. 992 (1957)
the Supreme
character
presumption
which brought
the statute, such result Vas
See also Standard"
Oil, 221
_
41 Lawlor
of
of,
v
U. S.
U. S.
in
ease
wide gyration of rate
was only in
i
The review, written by (jDodge
Magee, * Jr.,
economy.
39 bee note 10 hereinabove,
be disregarded by the substitution
n?t
<
38 Standard
the
they did
creating as
-. • i
181.
^Wch prohibitedthetheir bmng'
.
That is to say,
cases
but
made.
218.
Socony-Vacuum, 310 U. S. 150, 21037 Standard Oil, 221
American Tobacco, 221
purview
of
the
statute, they could not be taken out of
that
category
by indulging irt general
reasoning
as
to» the expediency or nonexpediency of having, made the-contracts
or
1% below the"record level >of the
banking system. This was the method used
by the monetary authorities in its efforts to bolster the sagging
_
228.
the
within
trade
1958
only
months
six
funds available to the
34 Socony-Vacuum, 310 U.S. 150,214,
"
to
a
con¬
discount rate came several cuts in reserve
requirements, and
stepped-up purchases of Government securities in order to make.
217.
as
through
of
comparable 1957 period.
effective
m»e'? ThS 2lfSocny.Vacuun„ 3,0 U. S. ,50. ,66-
Sr
very
total
construction, in
of
first
with
...
33 Socony-Vacuum, 310 U. S. 150,
a
3V2 to 3%, and this signalled
17, 18, 19, 31-33, 54, 56. 65-67.
78, 79, 83, 154, 155, 157; i62;
0
in
November of 1957 when the discount rate
Vol.
II,
See also BICKEL supra
76,
be
to
cumulative
for future
amounted, to $16,788*625,000,
the
was being initiated. Not only
advancing, but the return on the
maturities has also been in the
The money market has been
movements
strictures
which
The
tracts
Wide Gyrations in Money Market
f Socony-Vacuum, 310 U. S. 150, 166-
being
been
ax now
1958* ac¬
cording to the mid-year reviewof
construction
contracts published
Aug. 20, in Building Business,
monthly bulletin of F. W. Dodge
Corporation.
increase in
and long-term
Thus, in this instance, the Federal Reserve Board haS-v
followed the hardening in rates in the money market instead of;
initiating the rise as has been the case many: times in the past. j, 0
TAFT,
~
done
short-term rate
the
industry, to
record in the first half of
ascendancy.
,
missible
an
.
22nl2ll
67.
Tobacco
American
Board, by authorizing
intermediate-
against exempting
"
»
^»'
from
the
prohibitions of the Sherman
30 Socony-Vacuum, 310 U. S. 150.
Act
practices, transactions, agreements
31 Socony-Vacuum, 310 U. S. 150, 166and acts simply because they seem argu200.
ably "reasonable": Thus in .Standard Oil,
■
c—1/
.»
221
U. S.
1,
65,
the Supreme Court2,
states "...resort to reason was hot per'
•
abound
construction
major change in monetary policy
has
the deciding vote for Justice Stone's
for Justice Brandeis' views car-
969-970
Oil, 221
24 Standard
a
>ied great weight with Justice Holmes.
THE LIFE AND TIMES OF
183.
23 Standard
Supreme
draft,
Oil, 221 U. S. 1, 71, 75;
Tobacco, 221 U. S. 106, 182,
Reserve
\
Sharp gains in heavy engineer¬
ing and residential building in; the
second quarter almost carried: the
associate
71.
1,
22 Standard
American
of
ss;
U. S.
Oit, 221
very potent dur-
stages
record levels of 1957%
power
the discount rate of the Federal Reserve Bank of San
Francisco,
added substance to the recent upward trend in interest rates that
Justice Brandeis could have participated
the Supreme Court conference on
65;
cast
21 Standard
conference
Federal
Anticipates-biglMf
construction totals in, 1958 than *
Reserve Board Followed the Market
The
Preface I-IX, and FREUND Introduction XV-XXI in BICKEL supra. If
179,
0il- m u, s.
.
the
frequently
construction*
evidence, particularly in the longer-term Government obligations.
The move toward greater credit restraint will mean higher rates
in future Treasury financing.
C„„
control
the
prices, whether reanot, involves power
and to fix arbi¬
or
and
Street,
engage
in
a
New
R. E. Sees.
Com-
at 156 West
York
City,
to
securities business,
business,
investment business from
at
233
Broadway, New
City, under the firm name of
an
York
changes
Mark Greif Opens
become
unreasonable
price
of
tomorrow.
established, it may be maintained
Onchanged- because of the absence of
competition secured
by the agreement
well be held to be in themselves
unreasonable
or
unlawful
restraints,
without the necessity of minute inquiry
Aubrey G. Lanston
Sc Co.
Arthur E. Smith.
11« CORPORATE*
the
ing
offices
Marache Co. Branch
PASADENA, Calif. —Marache,
Qofflemyre & Co. has opened a
branch office at 940 East Colorado
Street under the management of
The rea
through
Mark
Once,
may
Trading
Sheldon L. Breitbart is conduct¬
Real Estate Securities Tradine Co.
market
trary and unreasonable prices.
sonable
price fixed today may
economic
44th
...
L.
,
Greif
,
is
conducting
Forms Retirement
a
Mrs. Margie
Program
Sperling is engag¬
20
Opens Branch
MINEOLA, Nf Y. —Prudential
Securities Corporation has opened
the Hotel Governor Clinton, 31st
York City, under the firm name a branch office at 80 East Old
Street and Seventh Avenue, New
of Retirement Programming As¬ Country Road, under the direction
p.,
n/
TAkn P
(*liv\ee *
S6CU1
__
„
...
itlGS follsillGSS fTOITI OfflCGS 3t
ing in
securities business from
offices at 509 Fifth Avenue* New
a
,
xOrK
.
quarter dramatic reversal, in comstructiontrendis pacedby public
far in the battle to
The uptrend in short-term rates brought with it a
higher
discount rate, all of which added to the chaos which has been in
BICKEL
U. S. 1, 58, 67, 73.
221
U. S.
1,
221 U. S. 106,
Oil,
Tobacco,
American
c
ir
«•»
Oil, 221
Oi,
so
of monetary unit. The upping
the Federal Reserve Bank of San
1%% to 2% last week signalled the end of the
policy of the powers that be.......
easy money
,tri?nL?xL®lCK„EL' THE UN"
PUBLISHED OPINIONS OF MR. JUSTICE BRANDEIS, 1-262 (1957), also
106,
>
18 Standard Oil, 221
to
29 Justice Brandeis great talents and
hl® extraordinary zeal and
were
diligence
U. S. 1,
Oil, 221
16 American
S^ony-Vocuun,
v
purchasing
been used
Central Bank rate by
the
S* 15°' 212'2^f (1940).
'
j"f.rgy and
182-183
182 l»3.
181
15 Standard
s
10
221
American
;
177
177,
those
open
Sherman Law, despite the reasonabIen?,ss of the particular prices agreed
upon.
64,
l8l.
U. S. 1, 58, 75,
Tobacco, 221 U. S.
Oil,
after
fairly
the
have
Francisco from
it has since often been deailways assumed that uniform
and
Oil, 221 U. S. 1. 58, 75,
7
and
seem
of
which
measures
maintain
its
price-fixing by those controlling in any
substantial manner a trade or business
in interstate commerce is prohibited by
;
:
before
not
of
...
being
is
both
the
are
.
Dodge Corp.
Economist. Magee reports second
work
a
recent sample of_ adjudging
determinating
legality ofconduct by itsover-allwhich can be satisfactori,
and effect see Judge Sylvester after a complete
survey of
economic
J. Ryan s decision in U. S. v. Imperial
organization and a choice between rival
Chemical Industries,. ,100 F• Supp. 504,
philosophies.
"
557 (D C. S. D. N
Y , 1951) in which
"That such was the view of this
Court
Judge Ryan indicated that in adjudging in deciding the Standard Oil and Tobacco
whether
the
Sherman
Act
forbids
or
cases, and that such is the
the
F. W.
By JOHN T, CHIPPENDALE, JE.
whether
as
Reporter oh-Governments
The credit
the field of business relations depend
/
181-184.
27
Sharp Construction
Out
to adopt a construction making the difference between legal and illegal conduct
1, 70-77;
106, 155-
,nv~
(727)
sociates.
BROAP, STREET
NEW YORK
☆
CHICAGO
☆
☆
BOSTON
28
The Commercial and Financial Chronicle
(728)
Sources ol
Free
States,
world,
anti-cyclical plus
anti-
inflation policy.
Instability
Let
these
of the entire
would
be
gravely
and
Economy
both the peaks and the
valleys of
business cycle.
the
examine briefly some of
us
inflationary biases.
First, there is the crucial mat¬
ter of industrial wage and price
policies.
I
use
this
inclusive
phrase because while some peo¬
munists, this problem of economic
instability would remain a matter
value of the dollar over the years.
Even if the business cycle were to
ple are willing to talk about in¬
flationary
wage
increases
and
others readily talk about infla¬
tionary pricing policies of busi¬
ness,
it is essential to recognize
that these phenomena are inex¬
tricably interrelated. Interacting
together, they have produced the
ominous wage-price spiral which
importance to all Ameri¬
disappear, we would still be faced
constitutes
The commissars stand
ready to inherit the earth.
Imperiled.
This Concerns All of Us
But
if
even
Graham
Billy
all
should manage to convert
of vital
com¬
This
of
problem
age-old
the
business cycle is still with us to¬
day, obviously, but in recent years
something new has been added;
namely, the problem of prevent¬
ing a continuing erosion of the
both as individuals and as a with this threat of inflation. In
nation. Every one of us is deeply addition to cycle control, thereconcerned with what we can buy lore, we must now be concerned
cans,
with
incomes. We are equally
our
with erosion control
well.
as
determinants
chief
the
of
the
only
not
potential and of
standard of living, but of our
our
entire social environment.
economy?
our
defense
our
Let
ask
warn you,
me
please, not to
economist that question—
an
unless, that is,
you
prepared
long,
are
this
problem has peculiar significance.
to sit back and listen for a
Economic education is essential to
vast
For teachers and educators,
economic
than
\stability.
Today, more
before, it is the voter—
ever
Average Joe and Josephine—
and
is
who
decision¬
ultimate
the
maker in the realm of
public
eco¬
nomic
policy. Sound measures to
strengthen our economy and to
combat instability cannot be
and adhered to without
understanding and the sus¬
adopted
the
tained
citizenry.
the
of
support
time. There is, of course, a
on
the subject of
business cycles. Indeed, there are
long
literature
few
subjects
Some
of
which
on
written
have
many
so
much for
so
these
writings
so
few.
there
and
too, in our
understanding of business cycles.
On
are
the
much
gaps,
other
that
hand,
do
we
there
is
Our
know.
Here, clearly, is a major responsi¬ knowledge of the dynamics of the
bility for teachers and educators cycle has been greatly enlarged
everywhere to contribute to the in recent decades and there is now
atabilty of the American economy a substantial area of agreement
by improving the economic liter¬ with respect to the basic causes of
acy of the American people.
cyclical swings and the factors
that
Interrelated Problems
Two
Let
kind
What
this
analyze
us
of
do
we
want? What obstacles confront us?
How
they be dealt with effec¬
can
point in
my
is
this
not
area
an
There
of
total
is widespread agreement
that
maintain
to
should
we
in
any good economics
though not in some
—
textbooks
on
is
matter
social
studies.
This
really
debate, of
course, as to just how high a level
of business activity is sustainable
and just what constitutes satisfac¬
about.
ability of prices. Neverthe¬
less, the main points are clear:
aspect of this problem of economic
is
high
for
room
tory
First,
want
we
to
avoid
big
6wings in production and employ¬
ment. This needs no spelling out,
A severe depression would
ob¬
viously be a calamity for all of
Prolonged
would
be
threaten
mass
unemployment
evil
an
that
ture.
would
social
whole
our
struc¬
Second,
want
we
Inflation
steals
part
savings and
be
robbed.
is
of
avoid
to
a
in¬
sneak-thief
the
value
of
do not want
Inflation benefits
we
chiefly the speculators and some
others who happen to be advan¬
tageously situated. The few who
profit do
rest
of
so
us.
at the expense of the
Inflation is an unfair
tax upon the
ing
thrifty and those liv¬
fixed incomes.
on
It
reduces
the living standards of millions of
families. And at this critical
junc¬
ture
of
history, serious
inflation
in the United States would
impair
our
ability
World's
to
lead
resistance
to
the
Free
Communist
tyranny.
We
with
are
a
therefore
two-fold
taught,
And
that
not
it
is
should
be
simply talked
a
subject on
which every citizen should be in¬
formed.
the
result
is
who
studied
has
however,
an
important
instability which you will not find
discussed very thoroughly in most
textbooks, namely, the problem of
continuing inflation. The reason
is
that
this
threat
has
emerged,
at least has become apparent,
only quite recently. Until recent
times, periods of price inflation in
or
the United States
were
invariably
by periods of deflation.
Throughout our history, major
wars always caused inflation but
prices
self-evident
turned
to
Peacetime
problem:
one
of
booms
were
usually
accompanied
by
rising
prices but prices usually receded
during the ensuing recessions.
But today things are different.
For
the
the first time
in
our
inflation generated
history,
by World
War II has not been deflated but
has become permanently inbedded
in
our
economy.
And
so
has
the
inflation of the Korean War, and,
for that
inflation
matter, most of the price
of
1954-57.
What has happened is that
inflationary biases
veloping
confronted
subsequently re¬
approximately pre-war
equally
in
have been de¬
our
economy. These
biases contribute to
pushing prices
during good times and to pre¬
preventing depressions, the other venting prices from ever
readjust¬
of preventing inflation. These two
ing
downward.
Price
increases
problems are closely interrelated, have tended to become
irrever¬
to be sure, because depressions
sible.
are almost always the
inevitable
This has
aftermaths
of
up
fundamentally altered
inflationary booms. the whole problem of
trying to
Indeed, most of us have long been maintain economic
stability. We
to
thinking of the cannot any longer afford to think
problem of economic instability as in terms of
anti-cyclical policy
consisting of trying to level off alone; we must now think in
accustomed
cism
of
to
held
ing
United
States have
constantly
outrunning pro¬
ductivity and this has inevitably
been
reflected
in
higher living
costs. Indeed, we have practically
enshrined
the wage-price
spiral
as
national
a
this
Just
witnessed
institution.
past
week,
another
have
we
in
boost
the
price of steel. Here is the spec¬
tacle of the wage-price spiral op¬
erating even during recession. A
rise in the price of steel has be¬
the
on
established annual event
an
enough that these
price increases are related to wage
increases.
Over the past 10 years,
put
per
hour in the
man
have
risen
more
three times faster than out¬
hour. The net result
policies followed by labor
and management in this industry
of
levels,
always
dur¬
even
The
is that monetary policy
not
effectively
without
combat
inflation
be
done
unless
interest
dates—the prices of various kinds
credit—are
of
times permitted
at
to rise.
There is always room for de¬
bate, of course, as to whether a
policy
of
credit
restriction
is
being overdone or underdone at
tiine,
particular
any
whether
should
and as to
techniques
different
be
employed.
However,
competent economist would
every
that
agree
during
imperative
to
boom,
a
prevent
it
is
unbridled
credit expansion.
has
been
75%
increase
an
of
about
in the price of steel.
One is almost tempted to regard
this as a conspiracy of Big Busi¬
and
Big Labor at the expense
the public;
This, of course,
would be too cynical a view that
the facts do not justify.
Never¬
theless, the wage-price spiral is
obviously real and it plainly con¬
of
stitutes
serious
a
public interest.
threat
This
the
to
threat
will
Here
is
learning.
lesson
a
that
needs
it
Is
being learned
the schools today?
third
inflationary
present-day
our
This
of this situation. Are they
learning these facts in the schools
factor
in
is
bias
is
even
employment and production
makes
mention
no
of
the
maintaining price stabil¬
Indeed, the biased emphasis
ity.
of this statement is
the
that
act
so
itself
well known
is
frequently,
though erroneously, referred to as
the "Full" Employment Act.
Fortunately, most public pol¬
icy-makers have interpreted this
policy statement as including con¬
cern
for
price stability.
Their
position is that this is implicit in
the goal of maximum production
and employment. They believedo most economists—that
as
the
Another
our
long
inflationary
today
economy
is
factor
the
in
wide¬
spread bias in favor of cheap and
over-abundant credit.
Actual^,
of course,
nomenon
this is not
at
all.
a
new
Indeed,
phe¬
one of
the oldest and
in
I
Act
were
believe
the
correct
How¬
it
be
to
should
inflationary
its
Full
tinue
to
our
wording, the Doctrine
Employment would con¬
be an inflationary force
As
economy.
"full
words
a
slogan, the
employment"
have
powerful appeal. The danger is
that they may be used to mobil¬
ize public support for policies that
are actually contrary to the broad
interest.
public
certainly one of the
injurious fallacies in the his¬
tory of man is the delusion that
prosperity for all can somehow
be conjured up and perpetuated
simply by creating more money.
Today
this
fallacy lives on.
higher level of
expense
of
prices, or policies
which might produce a somewhat
often
lower
Whenever
most
in
more
seductive
of
schemes
money
guaranteeing
guises.
All
spending
for
and for creating
more
credit,
popular appeal under
riety
has
of
banners.
a
Our
or
have
great
va¬
economy
become so complex that
people do not readily see the re¬
lationship between these schemes
and
now
the
threat
of
inflation.
One dangerous manifestation of
the
more-money
fallacy
is
the
widespread opposition to restrict¬
ing the expansion of credit during
boom.
You have all heard in
recent years a great deal of criti¬
a
cism
of
so-called
"tight
money."
made
choice
a
between
must
government
icies which favor
be
pol¬
a
employment
the
rise
some
at
in
level
of
employment but
stable prices, the political pres¬
sure usually favors the first alter¬
native.
Over time the cumulative
effect of
be
policies of this kind
can
serious.
Economists
that in
a
a
time would be
Brimful
these
are
needed
un¬
corrective
and
why
important.
are
One
ple
trouble
is
that many
peo¬
not really very much
are
con¬
about
cerned
inflation.
the
Some
danger
think
even
of
that
gradual inflation might be a good
that it might keep the
economy
pepped up.
Some as¬
sume that they may be able them¬
thing,
selves
to
keep
with
And
of
an
come
out
up
inflationary spiral and
all right personally.
during
a boom, the effectsseem
quite pleasant
people. Large wage in¬
and rising profits create
inflation
to
many
creases
illusion
an
of
improved wellThose who urge restraint
being.
such
time
a
spoil sports,
are
obviously
of little faith.
men
Too many people fail to realize
economy and that sooner or
later there must be a day of reck¬
oning.
They
do
that
repeated
over
a
period of
to
up
not
doses
appreciate
of
substantial
a
inflation
would add
years
in
cut
the
value of their savings.
They ig¬
nore the fact that
creeping infla¬
tion
degenerate into galloping
can
inflation.
I wonder how well these points
are
understood
by high school
seniors
today.
Structural Stability
So much for the causes of eco¬
nomic instability. What about thei
cures?
What can and should be
done
to
prevent
destructive
swings in production and employ¬
ment and to safeguard the value
of our money?
The stability achieved by any
economy
depends upon two
things:
its
intrinsic*
structural
stability, and the effectiveness of
measures
time
to
adopted
combat
cessions.
One
from
time
to
inflation and
re¬
matter
the
is
a
of
institutional framework; the other
a matter of short-run
anti-cyclical
anti-inflation policies.
or
Much
could
be
said
about
de¬
inherent stability of the American
economy
plus
are
in
agreement
such
permitting
as
of
no
whatever at any
highly inflationary.
employment
and
eco¬
nomic stability are not compat¬
ible.
Yet
many
people in this
country
do not appreciate this
fact.
What
are
they
learning
about it today in the schools?
built-in
stabilizers
in
the
Federal budget, and various other
factors. But there are entries on
the other side of the ledger too,
notably the inflationary biases we
have already mentioned.
On
balance, our economy is
probably much less vulnerable to
violent
it
cyclical
was,
a
than
There
little
of
disruptions
30 years ago.
say
is
possibility, for example
catastrophic depression like
that
of
the
'30's.
On
the
other
hand, we are still susceptible to
cyclical swings of serious magni¬
tude
and, in addition, we are
probably much more vulnerable
than
now
formerly to the
menace
of inflation.
Can
our
economy be made struc¬
turally more stable? Probably it
can
be,
and
varous
proposals
have
been
in
end
put forward with this
view.
It
would
certainly
be desirable if the American
peo¬
ple
better
were
some
market economy
policy
unemployment
ours,
why
measures
they
called
the
amended—as
in
enough informed to
derstand
in recent times. On the
side, you could cite the
strengthening of the banking sys¬
tem, the development of the so-
a
avoid inflation.
if
be—to
not well
sustainable basis
on
itself.
Even
unpop¬
velopments that have affected the
ever, you will find no mention of
this premise in the Employment
Act
are
maximum levels of
and employment can
be achieved
we
them
is
simply a shorthand
way of saying that the public is
over
run,
production
only if
This
official statement
our
need for
of
The More-Money Fallacy
Most of the things that should be
ular.
an inflationary boom permits
maladjustments to accumulate in
of
public economic policy,
the
preamble of the Employment Act
of 1946, which talks about maxi¬
bias
today?
will be very difficult to deal with.
the
economy
inflationary
to a
up
that
the
Doctrine of Full Employment.
In
extreme form, the adherents
of
this dogma proclaim that the chief
goal of economic policy should be
to
maintain
maximum
employ¬
ment at all times, regardless of
what this may involve in the way
of inflation and other heavy ex¬
actions on the American people.
reflected in
Complacency
biases plus others add
ary
in
Brimful Employment
probably continue until more peo¬
ple learn more about the basic
facts
Danger of
combination, these inflation¬
formidable threat to the stability
of our economy and one which
at
per man
the
Thursday, August 21, 1958
.
The
In
can¬
restricting credit and this
cannot
but
clear
should
inflationary boom.
an
mum
American calendar.
is
It
low
at
fact
any¬
Since the end of World War II,
so-called
interest rates
that
be
have heard criti¬
you
"high" interest
Many people seem to think
rates.
A
been
that
.
done to combat
Similarly,
them.
in the
mention
to
case.
else who stops to think about
manner
new-
and
one
always
levels.
economics
are
wages
fail
only alternative to a policy of
restricting
credit
expansion
would be a policy of not restrict¬
ing it, and that during a boom,
such a policy would be highly in¬
flationary. Yet this is clearly the
formidable wage-
a
price spiral. These facts are re¬
garded as axiomatic by everyone
ness
There is,
followed
i
flation.
subject
follow
concerns
pricing policies designed to pass
along to the public most or all of
their added production costs, then
than
There
to
business
tion. Solid information about it is
levels of
production and employment and
also reasonably stable prices.
that
when
costs
textbook
our
including fringe benefits,
rise more rapidly than productiv¬
ity, the result is bound to be
higher
production
costs.
And
industry
available
generally
wage
rates,
labor
both among economists and among
When
enough.
steel
people
us.
simple
mystery, conjecture, and disputa¬
tively?
.seek
be little
trying to summarize
this body of knowledge for you
here. But I do wish to emphasize
that
The basic facts of this situation
come
There would obviously
problem.
stability
aggravate them.
in¬
present-day
our
economy.
ad¬
are
mittedly controversial. As in any
field, there are plenty of points
on
which
the
experts disagree,
virulent
most
flationary bias in
are
purchasing
Sources of Instability
power of our savings accounts, our
savings bonds, our life insurance,
Why do these problems exist?
our pensions. And as a nation, the
What are the reasons for these
stability of our economy is one of tendencies toward instability in
with
concerned
the
critics
The
the
Wage-Price Spiral at Work
The
In Our
United
of
terms
Continued from first page
.
ever
upon
of
these
there is
acquainted
proposals.
no
agenda
with
How¬
generally agreed
of
institutional
changes that should be made in
order to make
our
economy more
depression-proof.
There is.
nevertheless,
point in this connection
agreement
does
exist
one
on
vital
which
the
great majority of economists and
students
This point
of
among
political
economy.
has to do with an in-
Volume 188
Number 5770
.
.
The Commercial and Financial Chronicle
.
stitutional change that should not
be
made, though it is frequentlysuggested; namely, the proposal
that
be
the
Federal
Reserve
System
made
completely subservient
to the political administration in
Washington.
Some
years
professor of
I
ago
money
heard of a
and banking
who started his course each year
by
tracing
the progress of
man¬
kind from its lowly origins in the
primeval slime until civilization
finally attained its zenith with
the
establishment
Reserve
do
not
this
of
whatever with
Specifically,
encounter
urge
of
the
of
have
purposes'and
the
Federal
func¬
Reserve
System
we
should fail to adopt appropriate financial policies, we may
of credit. They do not understand
suspicious and
it in actual operation,
result, demagogues and spe-
controls, price controls, and rationing.
These
should
not
be
thought of as being alternatives
to monetary and fiscal policy because they simply cannot accomp-
interest
lish
inclined to
are
critical
As
a
cial
it.
been
and
works
be
of
trouble
to
restraint
credit
how
in stirring
In
recent
there
noxious; they
years
has
tendency
in
workable in
policies
can
not just obinherently un-
are
are
kind of economy.
our
mi
-_.ji.i-
x-
How
do
much
stability of
When
turn to the matter
we
that
measures
from time to
flationary
dencies,
should
time to
be
of
taken
combat
in¬
recessionary ten¬
find a broad and very
or
we
important
area
of
agreement
among the great majority of econ¬
omists. Here again is solid infor¬
mation
that
Fiscal
It
Fiscal Policy?
rather obvious
seems
eral
Is
operations
Government
that
enormous
that
the
of
are
nomic
they
the
instability, and they
Fed-
now
begin with, there is general
that financial meas¬
ures—notably monetary and fiscal
policies—should be regarded as
our
most
important
means
of
dealing with economic instability.
some
circumstances,
financial
measures
in
fact,
be
all
may
that is required to keep the econ¬
on
an
even
keel.
circumstances, they
In
other
not suf¬
may
fice to do the job alone but they
always constitute
in
an
essential ele¬
stabilization
policy.
To
it the other way around:
at
unwise
financial
untold harm to
policies
our
can
do
economy.
get wanted rather
The
on
so
To
omy.
they
eco-
we
be
public
ing.
subject
econ-
however
understand-
How much
this
sensible
find considerable
effective
require
in
■5
ay*
.
A Contilluing Crusade
In. dosing I should like to
.
respect
fiscal
the
to
policy
should
There is virtual unanimity on the
broad proposition that the gov-
insoluble.
Our economy
has demonstrated a remarkable
ernment's policies with respect to sturdiness and resiliency and we
expenditures and taxation ought have at hand good weapons with
to be designed to mitigate the ups which to combat instability.
I
and downs in business activity,
think that a man from Mars, judgUnfortunately
unioriunaieiy,
however
there
noweyer
™ere
far less unanimity that fiscal
policy actually can be used eitectivelv
tiveiy
this
xnis
for
lor
reason
purpose.
that the
is
nle" cannot*
be
American
denended
unpleasant
suuport
peo-
uiDon
fiscal
to
policies
-fnweases in^taxes
cuts hi ex!
nindfturef When thev
needed 1" r 6 S ~ when they 316
or
are
'
Dvom„i„
+.
Take, foi example, the
of cutting taxes during a
T
,
inS the performance of the Amer.
in
economy
repent
nrnsneetive
in
vears
mieht rnnriudP
pr°ad prospective, might conclude
that,
'
all
things
°
.
which
basis
In February 1957 the
year*
19a0> rural
Pany
the
initiated
residential
rale
into
went
staggered
a
last
com-
and
.
In theory, this may at times
be justified to stimulate the econ-
permit
no
auestion
American
J e
to whether
as
people
p
a
for
complacency
as
remote
being something
mysterious like
very
and
Actually, of
or yoga.
consists
of
definite
sun-
course,
actions
the
ground that a
to inflation
lead
the
avoid
can
P
.
„
,
achieve these objectives
cut
tax
you
con
that
fact
be
examine
hardly
say
some
American
counted
on
to
the record, you
that this fear is
groundless.
•'
the
at
What
needed
is
nothing less
is
>
According
to
a
carefully
con¬
ducted survey, one-half of all the
supply
not
cost
of
credit
and
people
the
in
even
the
United
know what
States
do
is meant by
term
"balancing the Federal
budget." This being the case, how
can
we
expect fiscal policy to
money.
They thereby influence
production,
employment
and make its full potential contribution to economic stability?
prices.
Changes in spending with bor¬
Advantages of Financial Measures
rowed money have always
played
In addition to knowing somea
strategic role in the business
cycle.
By influencing this key thing about the principles of monfactor, the Federal Reserve can etary and fiscal policy, Americans
exert
a
stabilizing influence on should have some understanding
of the enormous advantages that
the whole economy.
This has been clearly apparent these financial measures possess
in recent years. The Federal Re¬ over most other types of controls.
serve authorities are not
infallible, One of the great virtues of mone¬
of course,
but in general, they tary and fiscal policies is that they
have
exhibited
great
skill
and do not push people around. They
courage in administering mone¬ are
conditioning factors, rather
tary
policy.
There
is
general than coercive. They do not sub¬
agreement among informed ob¬ ject us to bureaucratic red tape
and harassment.
servers that, on balance, Federal
They infringe
Reserve policy has
definitely hardy at all upon our freedom of
made a useful contribution to the choice, our freedom of action.
stability of the economy over re¬
By the same token, financial
the
is
amount
done
of
with
spending
borrowed
the
do
measures
years.
not
interfere
with.
other
hand, the record the proper functioning of our free
also shows that monetary policy economy.
They do not suspend
should not be regarded as a cure-¬ the interplay of supply and deall for economic instability.
mand
in
competitive
markets,
We
cannot follow destabilizing poli¬ They
permit the
self-adjusting
other
areas
with
the
ex¬
pectation that the Federal Reserve
somehow
offset
them
by
means of monetary magic. Mone¬
tary policy is potent but not omni¬
potent. It would be dangerous to
depend upon it to do more than
it actually can accomplish.
If monetary policy is to be
fective, it must have public
tendencies
erate
as
un¬
of
the
market
to
op-
they should.
Indeed, these measures can protect us from being subjected to
far more objectionable types of
a
_
continuing, all-out crusade
&cst that we dedicate ourselves to
that crusade here and
now.
«
.<■*
j"™
i
'
DqDGr'"and
contribute
i<?
tbo
,
p
Was also,
snread
industrfes
,
,
P
factor, and farm elec-
a
trification is
major field of sales'
a
pr°TtIon 1,1 19,58'
Tlle company s annual report,
•
'fTa «r,at
0l" .^??rch'
-f
st£^edv Respite the possibility of
nuln hnsine^ whinh
'1
abouf il% of indii<5trin 1 u.ri.n®
non ore mming activity
early part ofthe 19o8<
mdustrial sales
min!ng i.899??11'
i3re
oased on addinto some 23,000 kwv
Pji}?'™'nWi
a poP"
^
9* Electrification ol
°^er 105,000, has a sub- manufacturing processes, better
number of
a
*
nnn
'
,
<be
,
1nrh,«trv
thehalano/heincr
rGvenuec.
,over
e«
]ar«eqf
t
,
ll. a i.?n1
stantial trade in iron-ore, gram lighting, and industrial electric
and dairy products. Other indus- heating will be among the specific
.
.
.
.
cement
wood
directed
urograms
toward
arldiru*
in tne city aie cement, wood progiams directed towaid adding,
products, foundries, machine
shops, blast furnaces, meat packwiups,
this
load."
new
Capital set-up at the end of
uia^mrimces, mm pacK-
?.oc? P1 ocessmg and canning, 1957 0n a consolidated basis, was:
oil refining, telephone equipment, long-term debt- 56%, preferred
„
While the Mesabi lion oie ic- sidiary, the equity ratio was 35%.
being gradually de- Except for a 2-for-l split-up in.
reserves of low- 1953 there has been no increase
sei;ves are
P
ed, ^le
grade taconite
ore are now
being
Haratine Gas & Oil
Stock at $1.50 a Share
Herbert
Perry
&
Co.,
of
Inc.,
in the number of
common
shares*
.
.
is
also
amount
of
selling
a
to
the new communities created by
these giant projects.
Eventually
it is thought that U. S. Steel may
also build a large plant although
there
sion
has
been
no
average
definite
deci¬
around
15.5.
Two With Kidder,
Peabody
(Special to The Financial Chronicle)
power
BOSTON, Mass.
—
connected
now
are
'
*
William F.
Crowley and Richard Harte,
with
Jr.,
Kidder,
Peabody & Co., 75 Federal Streets
this.
on
■>
.
.
-
processing, dealing in, storing and Lawrence Seaway is expected to
selling petroleum, oil, natural gas be a favorable factor in the fuand the by-products or denva- tlll.e development of Duluth and
rives thereof for its own account superior. It is estimated that the
solely or as a participant with combined Duluth-Superior port
i!
or
AM
i-L
A
for the
eluded
yj.®
A
in
such
a41-»
1X1-
is
the
business
acquisition and disposition of oil
and
gas
leases
and
interests
therein
and
and
to
whether
oil
of
other
and
.
interests
gas
productive
or
m
properties
otherwise.
^Iie company bolds oil and gas
facilities
area
~
"
'
'
dominate
a
tributary
Gentilotti
certain of its property located in Jefferson Township, Ashtabula County, Ohio, and
in Madison Township, Perry
County, Ohio.
011
Giving
mentioned
"
joined the staff of
has
-
„
R01^311014 &
1
-
i—
T*¥
1
rh-r.h__
r
4:0 unainDer-
..
lain Parkway.
0f 540,000 square miles. Du-
undertaking a $40 million
commercial development, includ$10 million terminal,
recreation industry in
northern Minnesota is estimated
ing
a
AREA RESOURCES BOOK
rp}le
bring $50 million a year into
^
The company intends to use the
net proceeds of this offering to
commence an oil and gas drilling
\
WORCESTER, Mass.—Salvatora
]uth is
leases in eastern Ohio on 3b pararea.
Thousands
of
new
cel® ,°1? J-aad covering approxi- f0uris|s Were expected this year
mately 2,020 acres m Ashtabula £or
1958
Centennial Year
County, 1,853 acres in Fortage celebration, with the opening of
County and 21b acres 111 Feny |be Mackinac Bridge (connecting
County.
the upper and lower peninsulas
program
(special to the financial chronicle)
AMrt
of others.
account
000 shares.
multiplicity of govregulating our
it
and
renpn?Pnvnfn^
compares with an industry-
^
ernmental controls
a
pGwer>
ab^
wmch
With H. L. Robbins & Co.
New York City, is now offering
The City of Duluth has bene(Special to The Financial Chronicle)
an issue of 199,900 shares of com- fited bjT the expansion of the Air
mon stock (par five cents) of The j,^orce Base> and the building of a
WORCESTER, Mass.—Irwin H.
Haratine Gas & Oil Co Inc., at large branch of the University of silver is now affiliated with H.
$1.50 per share on a best efforts Minnesota. Expansion is continu- T
Rohhin<?
Rr
Co
inc
37 Mebasis.
ing in the two oil refineries which,
*
"
The Haratine company intends together with pipelines, have c>hanic Street.
engage in the business of pios- added
sizable
new
power
de*
.
c
D
CC jp
peering for, drilling, producing, mandg.
Completion
of the St.
Joins b. Komanorr & Co.
lives.
are
effectively they
used, the less pressure there
more
Great Lakes.
While these large
nlanta havft thpir nwn nnwpr S1I^
plants have their own power suppjy. Minnesota P. & L. has interconnections for exchange of
substantial
effect to the abovefinancing, there will
be outstanding a total of 424,900
shares of common stock, out of a
total authorized issue of 1,750,-
control. The
will ,be for
ef¬
.
X1
that taxes should be raised.
comes
If
„
taken by the Federal Reserve au¬
thorities.
These actions affect the
and
■
contributing -nearly half of
inflation and achieve reasonable fapidly developed.
Steel
comme m'mpei or common snaresomy. This proposal will neverthe- stable economic growth. The only
pan|es have expended nearly half
A+ «
+
less be opposed by many intelli- question is whether they will be
a jC)jmon dollars on plants to mine
+
f ? recent price of 32V2 tho
price 01
mo
gent and public-minded people— well enough informed to support |jie taconite ore and reduce it to sc^
4-®^° based on tha
as was the case earlier this year—
the measures that will be required pelleT'fnrm for shipment"oi/bie
the tax cut when the time
that most people regard monetary
^
etc. Dairying and resort business stock 11% and common stock
arUT,!w
vrTdv
W' however> excludi»g the sub-
cause
Too much is at
to
cannot
fear
was.
attitude, but plenty of
serious concern.
reverse
I
tracts expired.
Mmn" and 1h^n0}hf favojabie factor
ll?f'
people
monetary policy.
Wis
Looking to the future, I see no
excuse, certainly, for a defeatist
i^attei
reces-
sion.
we
inn
^X<nb9V* not been doing to°
badly at all.
stake
m
,
considered,
Hnino-
the
ine
And
Ana
purpose
means
perform.
can
on
^
_
than
in
into
em-
that
against economic illiteracy. I sug-
cies
Ameri-
increase
rate
effect
,1,
P
'
*
v ' ! " v '
.substantia1 growth m the area
The company has annual
Wood prod-*
enue.s °£ about $30 million, in-/:nets.concerns like Northwest Paeluding the subsidiary. The busi-y; per .^Company, Blandin Paper
"
— ^
Phasize that this ■ problem of
achieving treasonable stability for
d
perform, the American economy is by no;;TIe
role
general
from
First,
nearbv^UDeiior1
agreement among economists with
later date. This fear arises largely
On
by
revenues, due to the importance
sist of and the roles they should
cent
controlled
was
SfJp„Co*
wnen
tne
stock
came
siae,
•
might
that
years,
schools"todav'^v
y
-
briefly at what
monetary and fiscal policies con¬
us
hence
a
do
secondary
our
unwanted
again
also help
can
to preserve our free market
than unwanted
^
effects
on
look
effects
combating'economic
medicine for
bound to
are
conditions.
is
To
agreement
it.
Minnesota Power & Light Company
Minnesota Power &
Light, with
business dating back over 50
D0licies^are"'no'te^ahv'1 nnhSd ^ estimated at 363,000. Principal
policy is less mysterious,
financial
citizen should
every
know.
spots
By OWEN ELY
our
Useful
How
Here
How Useful Is Monetary Policy?
policy
Utility Securities
have serious
thing to do, therefore, is to try to
domination.
Let
financial
accomplish.( They
cal
the graduates of your high school
know about this subject?
look
what
opposition
up
alarming
an
little
have
groups
have far-reaching
ment
Public
find ourselves" saddled with wage
and some understanding
why most economists think it
is important to continue to protect
that system from complete politi¬
omy
day
respect to the use
knowl¬
some
of
In
we could some
situation in which, if
a
in 1914. Now I
the dissemination of
should
tions
and support. Many
people today have little or no
comprehension of the need for
ever exercising
any restraint
System
monetary inter¬
pretation of history.
But I do
strongly
believe
that
everyone
who graduates from high school
edge
derstanding
29
Federal
the
particular
today
(729)
of Michigan)
a
contributing fac-
New book
explains why
the
area
serve
so
we
offers
much
opportunity
to
industry.
tor.
has reported a
uptrend in earnings in
the past decade, share earnings
having increased from $1.56 in
1943 to $2.47 for the 12 months
ended June 30, 1958. The latest
The
company
general
report
was
surprisingly good
($2.47 vs. $2.26 in the previous
period) considering the fact that
the iron and steel industry suffered a very severe setback. A
possible offsetting factor was tjie
UTAH
POWER
& LIGHT
GO.
Write for FREE COPY
Bo* 899,
Salt lake
Dept. K
City 10, Utah
Serving in
Utah-Idaho
Colorado-Wyoming
1'
BO
(730)
The Commercial and Financial Chronicle
Women Bankers Hold
36Hi Convention in
Atlanta, Ga., Oct. 6-9
Leading bank
all
from
women
parts of the country will address
the National Association of Bank
its
Women
at
vention
in
Annual Con¬
36th
Atlanta
6-9.
Oct.
on
This announcement has been made
Miller,
Iweta
by Miss
and
Association
of *the
Vice-President
President
the
of
Assistant
First
City
National Bank of Houston, Texas.
members
500
Some
expected
are
to attend the four-day meeting to
be "held
at
the
Atlanta
Biltmore
Hotel.
,
Miss Miller will preside at the
opening session and the entire
first day is being devoted to busi¬
of the Association.
ness
Madeline
Miss
Continued
from
U.
S.
direct
IV presents
vestment
investment.
the
Research
Table
total foreign
divided
into
in-
various
categories and
the percentage of
category owned in the
each
U. S. A.
In
with
two interesting aspects:—
are
(a)
The
long and
investments
short term
foreign
in Canada
have increased from $7.6 billion
in 1945 to $16.7 billion at the end
of 1956. Of the $16.7 billion $15.4
billion represented long term in¬
and
Foundation
short
investment
Canadian
term
abroad
of
$7.2 billion at the end of 1956 was
total United
of
Canada
in
at
Bank.
Hiram
endeavors
than
more
capital
of
93%
requirements,
investors
time
will
it
before
Corp.,
Ltd.;'" Building
Limited; Canada Ce¬
ment, Ltd.; Dominion Tar &
Chemical, Ltd.; "MacMillarri&
Bloedel,
Ltd.
'B";! SherwinWilliams Co. of Canada, Ltd.
V
but a
Canadian
obtain
Canadians
Chemicals /
Canadian
of Technology;
Investment
Frederick, United
During the eleven years ended
Nations correspondent of the Na¬ Dec.
31, 1956 the total U. S. long
tional Broadcasting Corporation, term investment in Canada in¬
and tGerard JE. Hayes, Assistant creased
from
$4,990 million to
-
folowing
in
Canada
for
Vice-President
the
of
National
Shawmut Bank of Boston, Massa¬
chusetts .and
President
of
the
Institute
American
of
Banking,
will 'be the principal
speakers.
Outstanding -women hankers will
moderate and 'be members of the
panels
Mrs. Marion
Anderton,
Assistant Cashier -of
the Bank of America, Sani Fran¬
and
loans.
cisco, Calif., and Mrs. Ruth SherriLU Vice-President of the First
National Bank of Memphis, Ten¬
nessee,
133%. Of the
total increase of $6,661 million,
$5,121 million or 77% represented
the gain in the direct investment
and $1,540
million or 23% the
gain in portfolio bonds and stocks
will also address the Con¬
vention.
.
m.
The gain
of $5,121 million inch-
rect investments
inflow
net
the result of
was
of
capital of $2,782
million, and the balance from re¬
invested earnings of the subsidi¬
a
aries
branches
or
nadian
in
their
The
properties.
Ca¬
increase
in direct investments in 1957
substantial.
i Mr.
or
and all other forms of investment.
operations, trust, bank
on
selMng
million
$11,6*51
The
was
in
increase
Hayes, President of the
American Institute of Banking,
the
will 'present the Jean Arnot Reid
Award to the outstanding woman
net capital inflow of $741 million
from the sale of bonds and stocks.
graduate receiving her
Standard
value
of
of
$1,540
The
portfolio
million
balance
of
securities
represents
$799 million
may
accounted for in part by the
acquisition of additional outstand¬
ing Canadian securities and- in
Officer of the National Savings
part by increased market valua¬
and Trust Company of Washing¬ tions.
Miss Charlotte
A.
En gel,
Trust
ton, D. C„ .and Vice-President of
The largest inflow of
direct investment
capital for
was
$1,312 mil¬
lion for the petroleum industry
ident of the Association and will
followed by $474 million for minaddress the Convention on Oct. 9. ing.
N. A. B. WM will advance to Pres¬
Comments
on
the U. S. Direct
Investments
A
direct investment in Canada
be
may
defined
as
Canadian
a
company
whose
than 50%
owned abroad
.stock
is
or
more
as
Flittltfctorp
will
tarn
horn
tht mearch laboratory. Bit
IImm
Many
art
victorias today.
cancers can
bt sua#
whan
detected tarty and
treated promptly. Vigttane*
Is the key to this victor*
There
are
seven
algnaTa
of
such
Canadian
branches
at
of
4,957
the
which
companies and
end
of
3,707
1955
were
was
con¬
trolled from the U. S. A., 947 from
the United Kingdom and 303 from
other foreign countries.
At the
present time less than 24% of the
concerns
having
direct
ments
Canada
have
in
Canadians
invest¬
taken
in
part owners. Those
which have, such as
Ford, Stand¬
as
which might mean eaneer*
ard
Vigilance In heeding them
inghouse, Celanese, Sherwin-Wil¬
eeold
liams
victory ever can*
mean
air for you.
Imperial
Chemical
Industries, to mention but
have found that it is
f.Untisual
t. A
Oil, Goodyear, Dupont, Westand
sound
bleedingordischaraet
lump or thickening In the
or
bladder
8. Hoarseness
faction
or
or
Ing. 7. Change In
CANCER
60CIETY
n
j
divi¬
(b)
Canadians
facturing
and
manu-
It is
Cana-
resources
industries.
large degree responsible for
a
the
of the U.
success
S.
eign controlled
concerns
da.
human
is
It
few
pub-
but
for¬
and
vestor
in Cana¬
nature
desire that
a portion of this
ership should be Canadian.
Canadian
Portfolio
16%
Portfolio
stocks
of the
Stocks
accounted
total foreign
at
the
portfolios
amounted
billion.
to
This
The
for
tal
which
The
1945,
increase
Established
or
to¬
While
and
for
large
are
individual
interested
.
/t
years
the
a
.
•
the
;
-
6,964
$705
5,812
in-
$1,878
$1,649
84
530
53
2,225
1,226
55
J>
$5,112
$3,405
$641
$367
67%
56
$10,289
76%
-
2
;
have
opened branches in New'
York and other U, S. cities in the
pub-
they have
t
past SP.veral years.
More U. S. brokerage firms are
,
^
.
Stock
on
American
;the
Exchange and the number
is steadily increasing.
...
gamble
least 90 Canadian
listed-
stocks
f
-■;
:
"•
-
Foreigh Owned Investment,
by 2 "^D.
willing Ta.:; L..'t: - Companies...
,
investment in^^:- ^A Toreign - owned investment
-are
which
is
nov better
f j*- -
investors
company'is
a
Canadian
corpora-,
;-
from
advantages to the U, S. investors
salesmen
the selection of Canadian in-
are
SCHEDULE B
Stock Exchange
'.
y
''
-
-
December
^
'
!
"
230.37' "
6.02%
8.61
207.36
-ULil-
Yield
Ratio
^
5.56 /
9.36
8.34
11.08
"
""
'
5.44
-5.30
-
-
2/^12.27 '
/
V
Average
Avg. Price:Earnings
20 Industrials
162.08;
■
Index of 20 Industrials
T. S. E. Index of
December—^ J41.68-
5.07
.
-'
December
''
322.44
—
.
i
4.69
/12.79
«
-
319.75
,/10.91
.10,75
■
5.05
.
T
-
.
December/_u_
312.36
-
"
5.38
'^9.80
"
5.52
4.93
342.73
11.00
December—i 383.92
13.23
4.22
410.92
16.25
3.44
.13.57
3.63
14.43
4.07
December
December
438.21
—
465.83
463.94
"
,
'V
-
4.40
13>69
'
.
.
4.97
9.93
303.10
'
December
$13,468
'
'
'
1,009
Government and municipal bonds
Canadian
other major stock
on
exchanges.
1951—June_____315.51-
83
85%
1$
/v
M
Toronto
*
94%
$6,517
na-
opening branches in "Canada each
^year.-or establishing connections
all/ <of -Cam■
fchnadian brokers.
•
-"
unscrupulous
Of
Per Cent
$7,715
Portfolio Investments:
activity;
2
:
greater than
December___L 290:65
Amount
.
Average Price: Earnings Ratio and Average Yield of Components
—Held in U. S. A.—
$751
who
uninformed
certain
,
Total
'
<
tion .whose stock is held to the
(c) Measures are being taken
extent, of at least 95% by' nonand should be taken to 'protect '-residents of Canada. The* principal'
com¬
S.
Do-
Volume on the Toronto Stock
Exchange usually is considerably
.
received
_
100-to-l shot,
a
several
the formation of these
panies has offered the U.
/
,
natuia
?
6
entire
situation
than
who
growth of
past
j.
nat
.
their
lose
Canada.
Companies:—In
_
2
Uraniuiii
stocks:
prospect for
years,
out-and-out
an
individuals
years,
(2) Foreign Owned Investment
,
.who misrepresent the true
ture of ";p«nny stocks:"
as
'
,.v
....
(b) They should be purchased
as
of
the
_
have
stocks
"Jw 5s,
investors,
in
these
(a) Practically
Compa¬
are the stocks which are held for
the most part by institutional and
to
•sources.
and
profitable
expanding operations. These
many
records
.r,
menf"ofe Canada s
Canada's
,of
lumbering, manufacturing, bank¬
ing and other industries.
Most
of these companies have been es¬
long
,
V
.
par-
substantial capi-
formed
are
licity in recent
panies engaged in the railway,
public utility, mining, petroleum,
have
-
Canadian stocks ''.'.creasing'
shown
great deal of unfavorable
a
nies:—This category includes com¬
tablished
T
Ltd.;
base
divided into three broad classes:—
Well
'/'
.
Co.,
metals, oil and< gas,
* The -Toronto. Stock
Exchange
and more recently uranium, that industrial average is down only
are the principal vehicles of
spec-2^6.2% from the high level of a year,
ulators.
They are the so-called ago. See Schedule B.
;
'•penny stocks" or "cats a ltd dogs.".-"
'Many Canadian stock brokers
gold,
increased from
of
rate
~J'"'
_
Bridge
•/.- ^0B Foundries & Steel; The
Speculative New .Venture
Companies:—It is these companies
on
Dec. 31, 1955
approximately $1.2
had
.
_
t^x: advantage.
(4) Evidences of Increasing Insince t^ieir for- terest in Canada:—The following,
important, pur-Aare a Tew comments .on the in-
appreciation.
(3)
day, however, is far greater than
in the early postwar years, be¬
cause of the growing interest
by
American investors and specula¬
tors in Canada's expanding econ¬
omy.
Canadian equities may be
(1)
.
.
Steel
"2- - .V '.' Steel Co. of CanadayXtd.///
growth
Canada's
companies
and have
invest¬
date.
same
$.6 billion at the end of
100%.
.
medium/for;
in
definite
a
mation have been
total Canadian stocks held in U. S.
Direct Investments:
Estate, Mortgages, Etc.-.
sound
a
as
These
own-
only 12% of the U. S. A. in¬
vestment
,
-
Simpson s,
Moun- '
of
ticipating
ment in Canada at the end of 1955
and
i
„
Trans
Power:
Pipe Line Co.; Union Gas"
Co. of Canada.
A. \://-*
.;//
Dominion
,
chasers of sound
C.
(Millions)
Real
-•
well
to
.
I
1199455327680——JJuunnee./,
.
&
tain
*\/'V
; -
J
,,v
.of
Canada; Falcoribridfee Algom Uranium Mines, Ltd.; ConNickel
Mines, T.trl •1
Mines, Ltd.; 'Holliriger1' solidated* Denison Mi^ps ■ Ltd.;
Gunnar .Mines, Ltd.; Northspan
Cons. Gold Mines,' Ltd.; Inter¬
Uranium
Mines, Ltd.;
national Nickel; Mining
Pronto
Cqrp.
Uranium Mines, Ltd.; Stanroch
of Canada, Ltd.; Noranda Mines,.
Uranium Mines, Ltd.
Ltd.; Quemont Mining
~'
dian iabor an(j |n many instances
Canadian management which are
to
Water
'
Ltd.^A".*
Metals and Mimng :
S.
&
have a justifi¬
pride in the corare
developing
which
their natural
.
^
;
Tel., Co.
Bell
Canada;.
British * Columbia Power Corp.;;
Consumers Gas Co., Ltd.; Gat-,
ineau Power Co.; Interprovincial
Pipe • Line
Co.; Shawinigan
xj
t
'
public Utilities
Aluminum, Ltd.; Consolidated M/ '
able interest and
porations
'/"• V*1/-*/;
d*
corporations.
a wart or mol*
AMERICAN
Canadian
rr
Powell
>r
The
Equipment
Hudson's Bay Co., Ltd.?
dends today is being paid to U. S.
difficulty in swaUoto
If your Signal lasts longer than
(wo weeks, go to your doctor to
If It means cancer.
6
all
of
J.
&
Merchandising
subsidiary
advantage.
More
Foreign Investment In Canada, Dec.
31, 1955
habits.
cough, t. fncfc
40%
Ltd.;
Corpl,'Ltd.;
the
TABLE IV
hieest or elsewhere. 3. A sore
thai dees not heat. 4. Change IP
bowel
a
while
Co., Ltd.;
Corp., Ltd.;
Paper Co.,
River Co., Ltd.;
Lakes
St." Lawrence Pulp.
'
^
Great
\
:
A
an
unincorporated branch of a for¬
eign concern. The total number
•sneer
than
^
Finance
credit,
this
have
i
,: •„
Industrial Acceptance
Traders Finance Corp.,
a
be
Certificate.
tax
&
Consolidated Paper
The
Cable; Canadian
-Westinghouse Co., Ltd.
the
stocks of the Canadian
do
Wire
reasons:—
20%
-
Paper and Pulp
duPont "of
Sec., Ltd.
Electrical
Canada
(a) Dividends paid on stocks of
U. S. corporations do not receive
the
Industries;
Canada
in¬
not
are
/■■'•
,
Abitibi Power & Paper
•
a
portion of the ownership and
profits of the foreign corporations
with wholly owned concerns in
Canada.
.
f*
Products,
is
and
;
m
Oil & Gas, Ltd.;
Oil Co.; The
Edmonton
Corp.;
Canadian Oil Companies; Central
Del
Rio
Oils. Ltd.;', Imperial Oil, Ltd.: McColl-Frontenac Oil; Royalite Oil Co., Ltd.;
Triad Oil Co., Ltd.
^
Construction
&
-
British-American
Calgary
_
J
-
Bailey Selburn
.
'
seek
-'A
Milling: and Grainy;e.Z\
.
Asbestos
its
of
Mines,-;
Iron >Mines,(,
Oil and Gas
Corp.-Seagram^, Ltd.1:
Walker-G. &
Wv Ltd.
Building
new
...
vators, Ltd.
•
inflow
Pauline
Miss
rt:Z
Beverages
was only
capital in¬
vestment
during the period. In
any country which is able to gen¬
erate from its own Resources and
subsidiaries
Institute
Illinois
capital
of the total
Gordon
Rock
Maple Leaf Milling: Toronto Eler
of
Distillers
♦
.
-v.
Montreal; The Bank of
Nova Scotia; The Canadian
Bank
of
Commerce; Imperial
Bank of Canada; Royal Bank of
Canada; The Toronto-Dominion
terested in investing in the stock
of U. S. corporations which have
Increase in U. S. Direct
!
Bank
Dec. 31, 1956, less
represented an inflow
of capital.
As previously stated,
net
Ltd.,' Steep
;^Ltd.
Canada Ltd.;
T.;l & ;r. Co.,
Banks
half
6.7%
Stocks
Ltd.;;, Sherritt
of
Goodyear
ended
than
Co.
{./%:V,•..
;
Canada.
Although foreign long term
capital invested in Canada increased $8.3 billion in the eleven
the
Motor
The
Canadian.
have
to
matter
long
The
(b)
relations
Ford
shareholders,
years
connection
the foreign
investments in Canada the follow¬
ing
lie
Automotive
I/;;;
Participation in Canada's Growth
Through Canadian Securities
Federal Re¬ greater than the
serve Bank of New York; Virgil
States investments
H. Disney, Manager of the Elec¬ the end of 1950.
trical
Engineering
Division
of
the
SCHEDULE. A?*»'
:•;.
vestments.
Statistics Division of the Research
Armour
9
Thursday, August 21, 1958
.
Selected List of Canadian
McWhinney,
Chief of the Financial and Trade
Department <of
page
.
.
4.35
479.67
14.26
397.52
11.35
5.27
449.60
13.64
4.27
.
Volume 188
Number 5770
.
.
The Commercial and Financial Chronicle
.
vestments
by experts, and limit¬
ing of taxes to U. S. capital gains.
Continued
jrorn
If the walkout comes,
4
page
October at
(1) Tax Advantage: — T h e-s e
funds operate so as not to be sub¬
ject to any I'. S. income
against 'General
free.
Since
invested
are
almost
stocks
common
not
pay
has
no
earnings
dividends;
*
tax
until
_
decides
to
At that time the fund
liquidate.
withholds for
'ernment
he
tje Canadian Gov-
15% on his share of the
accumulated
income
net
now
dropped by
than 4,000,000.
more
The
Y
.
..
The
metalworking magazine pointed Out that this reversal of
-inventory policy, coupled with continued improvement in the
and
nothing
on
any
capital
gains..
Thus, the shareholder would haVe
"only a U. S. capital gains tax to
pay on his total profit on liquidatioii, against which the amount
paid by the fund to Canada would
•be available as a credit against
.
-overall
The overall
-his
U.- S.
The
which
all
funds
but
in
formed
were
million
$302
invested
!
in¬
of
one
have
1954
almost- entirely
in. Canadian
Canada
General
securities:
Fund
.
(1954)
.Limited.
Keystone Fund of Canada Ltd.
Investors Group Canadian Fund
Ltd.
International
Canadian
Growth
Fund Ltd.
New
:
.
York
Capital
k
Canada Ltd.
Scudder
.
Fund
of
Fund
;Y-Y :f
..
of
suppliers to come into the market for
The lag in auto labor negotiations is now begin¬
.
combined assets at the end of 1956
'of
steel
Canada
Ltd.
line
In
with
improvemertt, one large mill expects
August shipments to run about 20% better than July's, and Sep¬
tember will show a further improvement of about 5%. The gain
has come mostly from flat-rolled sheets and products used in con¬
struction.-'
-Y:.'
Y'
YY;
Another producer has already booked for September as much
tonnage as it shipped in June, which was the best month so far
this year due to hedging against the expected price boost.
The construction outlook is especially good, according to "The
Iron Age."
It reported that a steady rise in structural awards
•during the last several months will be reflected in a still better
plate and structural shapes market this fall.
Other bright spots in the steel market outlook include bigger
crops, which have put more money in the farmer's bank account
and he is buying more fencing and wire products and more ma¬
Funds:—
following foreign-owned
vestment
in
ning to effect the steel market and is delaying complete recovery,
this trade journal observed.
Y
.
Y
,
.
capital gains tax.
List of Available
pickup
parts
October tonnage.
-
.
(2)
steady
gains in the market offset.continued reluctance by
automakers* and
'
responsible for the
is
economy,
demand.-"
>
terials
general
handling equipment and implements. Demand for oil
Axe-Templeton
Canada, Ltd.
Growth
Fund
! Y"* f
.
United Funds Canada Ltd.*
is. well
/ ':
its way to recovery, "The Iron Age," further reported.
on
It predicts a steady improvement in the
remaining months of 1958.
"And
First Boston
Group
after,.that, steel users will begin worrying about the mid1959 steel labor negotiations. Uncertainty over how these labor
talks will turn out will give a boost to steel ordering in the second
quarter of 1959 as a hedge against a possible strike. Steel opera¬
tions coqld hit 90% of capacity during this period," it concluded.
f
Offers Public Service
The
At
First Boston Corp.
sociates
and
$354,500,000 in July, the seasonally adjusted annual rate
of personal income was at a record level, according to the United
^States Department of Commerce. It rose fractionally from June
and was 2% higher than the recession low of February. Although
the total of wage and salary disbursements was higher than the
prior, month, it was well! below the similar 1957 level.
as¬
offering publicly to¬
are
day (Aug. 21) an issue of $60,000,000 Public Service Electric &
Co.
first
'bonds,
and refunding
4%%
series
Gas
,
mortgage"
due
1988,
at
102.046% to yield 4.50%. to matur¬
ity.
The group
Net
the
sale
on a,
bid,
;Y;
'
This
'
proceeds from the sale of
bonds will be added to
new;
veiitory
applied to the payment before
maturity of: $10,000,000 of unse¬
cured
of
ment
its
portion of
a
Which
is
'000,000.
the cost of
construction
current
program,,
to total $290,-
expected
Of this amount, the
com-
'
estimates
pany
000,000
has
that
beep
$96,-
will
or
*
expended in the last
about
seven
be
"Ward's"
The
bonds
new
redeemable
are
option of the company at
regular redemption prices ranging
from 106.55% for those redeemed
prior to Aug. 1, 1959, to 100% for
those redeemed
and
prices
those
on or
1959, to 100% for those redeemed
or after Aug.
1, 1987.
is
Service
Electric
Gas
&
operating public utility
company engaged in the electric
and gas business in New Jersey.
•In addition, it owns all the out¬
an
standing
capital
Service
Coordinated
of
stock
serves
arid extends
areas
in
New
-
the
12
months
ended
May 31, 1958, total operating
enues
rev¬
of the company amounted tc
$332,866,588
$34,565,993,
and
net
income
compared
with
to
total
operating revenues of $322,488,939
and
they will be followed by Rambler
further reported.
operations,
that
is,
Ford,
a
week later, this trade journal
*
"Ward's"
week
estimated
a
last
week's
truck
13,148
units
20,001 in the
same
output at
in the week previous and
15,441
ago.
year
To
date, 2,701,598 cars and 544,745 trucks have been turned
out in the United States in 1958, according to "Ward's," compared
to.totals of 4,149,505 and 719,593 at the same period in 1957. The
-declines are 35% for cars ancl 24% for trucks.
net income of $34,384,882 for
the calendar year 1957.
New business
from
be
incorporations in July totaled 12,454, up 3.9%
,the 11.991 of the previous month, for the third consecutive
This was the highest level since January of this year.
July total exceeded the 11,686 of the similar 1957 month by
a
Automakers
caution.
They
Reuther's
in the
are
not
on
contract.
a
risk
If the UAW calls
more than steel, they reason.
If the automakers are shut down in the
quarter, the
of a year-end rally in steel will be dimmer.
Despite the slowness in automotive buying, the trend toward
a
stronger market is unmistakable, this trade weekly stated.
Steelmakers have boosted their output for six consecutive weeks.
Last week, they pushed the Operating rate 1.5 points higher to 60.5%
of capacity. Production was about 1,634,000 net tons of steel for
ingot and castings. District rates were as follows: St. Louis at
74.5%
of capacity, down 15.5 points -from the previous week;
Wheeling at 74, up 0.5 points; Cincinnati at 73, up 30.5 points;
Detroit at 70, up 1.5 points; Western district at 70,
up 2 points;
Chicago at 69.5, up 2.5 points; Eastern district at 60, no change;
Cleveland at 55, up 1.5
points; Birmingham at 53.5, down 1 point;
1 point; Pittsburgh at 53, up 3 points and ;
Buffalo at 51.5% without change.
'
Youngstown at 53,
up
.
More
than
other industry, construction accounts for the:,
in steelmaking. It replaced the automotive business as
upturn
any
steel's best customer
markets
total
included:
domestic
the
seven
The 1958 level
ago and 5.5%
total of 87,770.
period.
1957
83,714
month
of
year
a
82,933, down 0.9%
below the record 1956
was
-
Steel
Shipments? to the ihajor
(warehouses), 18.6% ♦ofvjfc'
(biggest buyers* but not ultimate con- 1
service
shipments
centers
sumers); construction (including maintenance), 16.3; automotive,
15 and containers, 12.2%,
Last year, service centers took 18.2%
of
finished
steel
shipments;
automotive,
construction,
and
•
>
•
Scrap prices last week moved slightly lower.
the recovery of
threat
of
a
a
strike
in
the
auto
The
American
Iron
and
Steel
Institute
operating rate of steel companies will
^capacity for the week
beginning
announced
of
capacity, and 1,632,000 tons
Aug.
18,
a
week
ago.
f
chances for
hate to
the
a
automakers
the
union
settlement look less hopeful.
want
a
walkout,
but
General Motors would
(they extend
repudiate agreements with 12 other unions
their contracts)
by offering something better to the United Auto¬
mobile Workers union.
lose face1 by
mented.
nor
-
settling
The union has stalled
on
company
so
long that it would
terms, this trade weekly com¬
.
}
140,742,570 net tons compared With actual production of 60.5% the
week
before.
a
month ago the rate was
*Index
■v;
*96.2% and
pro-Y
A year ago,, the actual weekly production
placed at 2,101,000 tons,
was
Y
»
For the like week
or
130.8%.
of production is based
oil
'•
average
weekly production
-
for 1947-1949.
Electric Output Recorded a New Ail-Time High Level
For Third Consecutive Week
{
The amount of electric energy
distributed by the electric light
industry for the week ended Saturday, Aug. 16, 1958,
at 12,851,000,000 kwh., according to the Edison
•
Electric Institute.
Output in the past week established a new'
all-time high level.
The previous record high was set in the )'
week ended Aug. 9, 1958 when output reached 12,707,000,000 kwh.
f
For the week ended Aug. 16, 1958 output increased by 144,000.000 kwh. above that-of the previous week, and 442,000,000
kwh. over that of the comparable 1957 week and an increase Of
and power
,
estimated
was
-
1,057,000,000 kwh. above that of the week ended Aug.
Car
18, 1956.
Loadings in Week Ended Aug. 9, Declined 0.6% Under
Previous Period and 16.5% Below Like 1957 Week
freight for the week ended Aug. 9, 1958
were 3,624 cars or 0.6% below the preceding week.
Loadings for the week ended Aug.; 9, 1953 totaled 618,580
cars, a decrease of 121,891 cars, or 16.5% below the corresponding
1957 week, and a decrease of 96,627 cars, or 13.5% below the
corresponding week in 1956.
Loadings of
revenue
Automotive Production Lower the Past Week
Manufacturers Ended 1958 Model Output
For 1959 Cars
Automotive
as
Most
and Geared
production for the week ended
16,
Aug.
1958,
according to "Ward's Automotive Reports," turned downward as
manufacturers
ended
1958
model
output
and
geared Tor
i
-
With
65,614 (revised) in the previous week. The past week's production
cars and trucks amounted to 73*528 units, or a decrease of
total of
units
7,527
under
that
of
the
previous
week's
output,
states
"Ward's."
car
output declined below that of the previous
by 5,234 units, while truck output dropped by 2,293 vehicles
In the corresponding week last
Last week the agency reported
in the
United States.
week and
year
117,598 cats
trucks were assembled.
20,001
there
13,148 trucks made
15,441 in the previous
were
This compared with
a year ago.
cautiously, it added.
Neither
.
Output for the week beginning Aug. 18, 1958 is equal to about
62.2% of the utilization of the Jan. 1, 1958 annual capacity Of
and 20,001
business, "Steel" magazine stated on Monday last.
strike is already making automakers buy steel
the
that
*104.5% of steel
1958, equivalent to
average
1,678,000 tons Of ingot and steel castings (based on average weekly
production for 1947-49) as compared with an actual rate of 101.6%
during the week.
industry which could block
...
Lack of buying
interest is due chiefly to consumers' resistance to recent advances.
"Steel's" composite slipped 67 cents to $42 a gross ton.
week
of Ingot
Capacity This Week
Odds favor
The
17.8
15.7%.
Last week's
Output Scheduled to Reach 62.2%
.
during the first half.
steel
Last week's car output totaled 60,380 units and compared
Despite the increase in July, new business charters for the
first'seven months of this year w ere down fractionally from the
;
fourth
chances
1959 cars..
6.6%.
strike, the cash
a
vyill be worth
The
comparable
.
com¬
market, but they are exercising great
big orders until they get Walter
will
name
most
from
The fourth quarter wash- .*
big blow to auto suppliers, including steel
panies, "Steel" pointed out.
increase.
Jersey
into New York
City,
Philadelphia and Wilmington.
During
such
in
Public
Transport;
which operates a comprehensive
mass
bus
transportation system
that
involved
manufacturers
Edsel, Mercury, Lincoln and Plymouth.
Y " Btiiok, Dodge, De Soto, Chrysler and Imperial were looking
-forward to the start of new model assembly on Monday last and
redemption
from 102.05% for
redeemed prior to* Aug/1,
on
Co.
.'five
after Aug. 1,
special
at
ranging
Public
corresponding week last year.
Chevrolet ended 1958 model output on Friday to leave only
-
contrasted" to
the
1987;
add 117,598 in the
months
of -1958.
at
as sales nearly double fading factory output.
noted that car production the past week totaled an
estimated*60,380 units compared to 65,614 in the preceding week
loans and to the pay¬
bank
•
sharply this month
the general funds of the. company
and
13.365 rate for entire July,
Reports" revealed on Friday last.
agency reported good progress with the 1958 model incleanup and stated that stocks are expected to drop
"Ward's Automotive
-
of 101.1699%.
averaged
13,375r units' daily, paralleling the
awarded the
was
issue at competitive
the automotive industry last week new car sales
In
out would
eduction 1,546,000 tons.
■<v\V
El. & Gas 4%%
,
could be built in the first nine months.
coun¬
try prill pipe and casing also will improve, partly because of the
Mideast, crisis.
v
.Y.
Regardless of what happens in automotive, the steel market
,
of
'
Motors would be far more expensive than -it
Ford, but the Big Three are still showing astonishing
solidarity, so look for operations at the other two, to end, if-the,
Ford walkout comes, it declared.
If there is a strike, it could be a
long one. That does not alarm
the Big Three too much. The
5,000,000 annual car market forecast
would be at
.
industry,>inveiltory cutting by steel users is over,
"The Tfoh Age," national metalwoiking weekly, declared on Wed¬
nesday last.
It stated this week that metalworking firms are beginning to
see the light on inventories.
They consider further cuts too risky
in view of unsettled conditions in the Mideast.
.Y. "
-•
shareholder
a
mid-April high of 3,363,000, the number of workers
a
-In the steel
do
and
Since
8.1% to 5.6%.
panies, their tax liability is.minor.
their
"
portion of workers covered by unemployment insurance programs
who "actually collect benefits has dropped during that span from
com¬
Y As these funds accumulate and
reinvest
due in part, according to the department, to model
collecting benefits has
in
entirely
of Canadian
was
change-over layoffs in the auto industry. The report on new claims
always runs a week ahead of the one on continuing claims.
*
funds-
these
This
ago.
taxes,; these funds are not
subject to any capital gains tax,
And practically all of their divi¬
dends from Canadian companies
tax
The union fears that a strike against Chrysler
necessarily influence General Motors and Ford. Action
would not
or
nadian
are
it will be in late September or in early
A auto walkout would probably be'
model time.
new
aimed first at Ford.
capital
With respect to Ca¬
gains taxes.
31
(731)
Lumber
Shipments Rose 7.1% Above Production in the
Week Ended Aug. 9,1958
Lumber shipments of
Aug.
9,
"National
474 reporting mills in the week ended
were
7.1% above production,
Lumber Trade Barometer."
In the
1958,
according to the
same
Continued
period new
on
page
32
)
32
The Commercial and Financial Chronicle
(732)
31
Continued from page
of the week, it turned lower at the close. Flour prices were down
substantially from a week earlier. Supplies of rice were limited
,
The State of Trade and
Industry
14.5%
were
above
weeks.
'•
Business Failures Registered a Marked
Decline the Past Week
Commercial
week
ended
failures
industrial
and
Aug.
from
14
in
290
declined
to
in
262
the
the
preceding week, Dun &
Bradstreet. Inc., reports.
However, casualties remained higher
than the 222 in the comparable week of last year but were lower
than the 239 reported in 1956. Failures were 4% more numerous
than in the comparable week of prewar 1939 when 253 occurred.
Failures involving
•
:
.
to 35
from
in
rise
■
•
cocoa
1957.
League President Joseph Holzka
ever.
Purchases
steady.
was
of
lambs
sustained
were
close
sociations set record
home
198
50, but exceeded
Twenty-nine businesses succumbed with liabilities in
$100,000 as against 28 in the preceding week.
excess
Retailing casualties were down to 125 from 141 in the prior
week, wholesaling fell to 21 from 24, construction to 32 from 47
lending for month of July.
biggest lending month in the As¬
to
sociation's
history
those of the
cotton
of
for the
ended
week
Aug.
5,
were
and
Reflecting the revival in home
building and
buying, the July
home lending volume of the naition's savings and loan associations
estimated
set
This compared with 77,000 bales in the previous week and 70,000
bales in the comparable 1957 period.
For the current season
through Aug. 5, the
average
47,000 bales
was
casualties edged up to 59
Level of
regions.
Year-to-year gains.in
a
Savings and,
League
reported.-
Year Ago
J o s e p h
Holzka,
sales of major appliances, linens and
The toll in Middle Atlantic States dipped to 93 from 95,
New England to .14 from 17, West North Central to 5 from
11,
South Atlantic to 10 from 29, Mountain to 2 from 4 and Pacific
States to 73 from 80. In contrast, casualties increased in the East
housewares offset declines in apparel and furniture last week and
over-all i*etail trade equaled that of the similar period last year.
Interest in new passenger cars slipped slightly during the week
North Central States to 39 from 36 and in the East South Central
to 12 from 4.
The West South Central States held even with the
show.
preceding week.
areas
showing
an
The trend from a year ago
increase and three showing
was
mixed with six
decrease.
a
and
on
In Dollar Volume
were
again noticeably below
a
year
spot
ago,
League Presi¬
dent, said that
.savings
and
loan
checks
institu¬
tions made
The
a
July Business Failures Dipped in Number but Increased
sales
the
States
Loan
Trade Volume in Latest Week Held Close to the
Geographically, the week's decline occurred in six of the nine
any
July,
bales last year.
from 45.
year ago in all industry and trade groups.
new rec¬
for
United
nnd commercial service to 25 from 33.
Meanwhile, manufacturing
More businesses failed than a
a
ord
against 23,000
as
reflects
housing revival trend.
creased
exports
as¬
high in
new
The Staten Island savings official
states
this also was the third
at 105,000 bales at the New York Cotton Exchange Service Bureau.
declined to 227
savings and loan
announces
A moderate decline in trading in steers occurred, causing
prices to fall moderately. Cattle receipts in Chicago fell noticeably
below the prior
week.
Hog receipts expanded substantially,
sending prices below those of a week earlier. Hog buying, how¬
Small failures under $5,000 de¬
the 24 of the similar 1957
or more
week.
of
a
in
liabilities of $5,000
comparable week of
creased
fractional
prices a week ago, as
transactions improved.
Following the reduction in retail coffee
prices, roasters cut their prices during the week. A slight rise in
coffee trading at wholesale occurred at the end of the period. Sugar
buying picked up appreciably and wholesalers reported a slight
rise in spot prices.
was
prior week, but prices declined fractionally on in¬
receipts.
The larger than expected official crop forecast of 11,583,000
bales discouraged cotton trading last week. As a result, prices on
the New York Cotton Exchange slipped somewhat. United States
from 240 in the previous week, but were higher than the
the
There
Thursday, August 21, 1958
.
July Heme Loans by
Saving & Loan Assns.
At Record High Level
again the past week and buying held steady, leaving prices close
to those of the prior week. Reports of favorable harvesting condi¬
tions indicated that rice stocks would expand in the next few
.
production., Unfilled orders amounted
to 43% of stocks.
Production was 0.2% below; shipments 0.7%
above and new orders were 2.1% below the previous week and
15.1% above the like week in 1957.
orders
.
.
dollar
total
volume
of
retail
trade in
the period
$1,153,000,000 in
Wednesday of last week
year ago,
an
estimated
ended
was from 2% below to 2% higher than
according to Dun & Bradstreet, Inc. Regional estimates
Joseph Holzka
home
loans
during
varied from the comparable '57 levels by the following percentages:
July,
the
biggest lending total for any
July
in
history.
The previous
biggest July lending month was
New
England States -f-4 to 4-8%; South Atlantic -j-2 to -{-6; West
South Central 0 to +4: Mountain —1 to +3; West North Central
Although the number of business failures dipped in July to
1,253, their dollar liabilities moved in the contrary direction,
—2 to
climbing to $65,000,000.
buying of women's summer sportswear and cotton dresses <
fell during the week holding over-all volume in women's
apparel
slightly below a year ago. There was a moderate rise in purchases
The July, 1958, home loan total
was also the third biggest lending
of
month
Despite the seasonal dip from the June
number, casualties exceeded by 18% their comparable 1957
level;
liabilities bulked 48% larger, lifted
primarily by nine failures
above the million mark.
Businesses
succumbed
at
an
apparent annual rate of 58 per
up from 57 in June and 48 per
10,000 listed concerns, edging
10,000 in July a year ago. However, the current rate
compares
favorably with the more severe prewar rate of 71 in 1939.
Retailers
and
between June
1958.
On
the
wholesalers
and July.
other
accounted
Their tolls
hand,
more
for
all
the
were
general
building
increases;
contractors
the
decline
so
far
in
manufacturing and construction
casualties occurred than in the
previous month.
-
of
smallest
contributed
Lumber mills and
largely
to
these
July
~
-f-2; Middle Atlantic and Pacific Coast —3 to -fl; East North
Central and East South Central States —5 to —1%.
Failures in manufacturing and wholesaling ranged 40% above
last year's* level.
Twice
as
many
concerns
succumbed
as
previous
in
fall
terest
last
dresses, coats, suits and some accessories. Although the
suits and furnishings expanded somewhat, in¬
in summer clothing slackened and total sales slipped below
There
year.
school
r
./r>,\
„
Geographically, trends
ment
month
and
a
year
ago.
in the East North Central
States, 40%
well
as
in the Middle Atlantic
as
rising moderately in the New England and South
Atlantic
States. In contrast, fewer businesses
failed in the South
Central,
Mountain and Pacific States.
Mortality held even with last year
in the West
North Central Region where
cultural states were balanced
by
*^n*ge cities reported
than
a
non-metropolitan
sharper
areas.
declining tolls in agri¬
considerable rise in Missouri.
upturn from the previous July
a
Detroit,
Milwaukee, Seattle, New
York and Chicago suffered
appreciably heavier casualties.
Wholesale Food Price Index
Edged
Lower Last Week
The wholesale
and
Fractionally
price index, compiled
by Dun & Bradstreet, Inc., fell slightly the past week. It stood
at $6.57 on Aug.
12,
thm^tho ^ w°n?+h»e -$6'i59 ?+the Pd0r Week' but
than the $6.36 of the similar date
.
"
Li
rye,
year ago.
3'3% hi^her
last week were flour, wheat, corn,
oats, hams, lard, cottenseed oil and
steers. Lower in whole-
hogs176 bailCy' bcef' bellies> cheese,
sugar, coffee, cocoa,
The index represents the sum
total of the price
foodstuffs and meats in
of 31 raw
Ievel1S
general
use
per pound
and its chief func-
w t e &enei«l trend of food prices
at the wholesale
Wholesale Commodity Price Index
Turned Slightly
Downward Last Week
Lower prices
on
most
grains, flour, coffee
and
cotton
offset
52S2?~ «!n
he
S,Crap' som? livestock and lard the past week,
general commodity price level
somewhat below that
of a week earlier.
The daily wholesale
commodity price index,
compiled by Dun &
Bradstreet, Inc., stood at 278.69 on Aug.
11,
down somewhat from
the 279.96 of the
prior week. On the com¬
parable date a year ago the index
was 293.66.
Despite a moderate rise in
export buying, wheat prices fell
appi eciably
the past week.
Although commercial supplies of
wheat expanded during the
week, not enough was of the quality
desired by flour mills.
Favorable weather reports in
growing
areas and expectations that harvests
would be larger than
pre¬
viously estimated discouraged the buying of
corn, oats and rye.
As a consequence,
prices slipped below the prior week.
Trading
in soybeans declined
noticeably with prices down somewhat.
Although flour trading climbed noticeably at the
holding
,
,
...
beginning
savings
dishwashers
back-to-
Mr.
buying of automatic laundry equip¬
President
Holzka,
sociation
boosted
Staten
of
■loan
lending
-was
the biggest
last
over
bedding,
loan
and
his¬
of
the
Northfield Savings and Loan As¬
in the
there
was
Island, N. Y.,
upturn in
sharp
home lending in July represented
19%
a
fractional
a
Interest in
that, the
said
year.
year-to-year dip in total
linens, floor coverings and draperies
month
-1958
in
increase
savings
and
July, 1957. This
increase for any
over
over
1957.
equalled that of the similar 1957 week.
Food sales remained close to
a
week earlier.
Housewives
Heartened By Upswing
were
primarily interested in fresh produce, canned fish, cold cuts, some
dairy products and fresh meat. The call for poultry, baked goods
and
frozen
foods
was
unchanged from the prior
retailers reported limited stocks of canned
goods.
A
substantial
curred last
week
rise
and
in
week.
total
volume
The
League
statistics
-July
official called the
"heartening evi¬
dence" of the way American sav-
Some
l ings
bookings in women's Fall apparel
oc¬
moderately exceeded that of
a
year ago. Best-sellers were coats, suits and better dresses. At¬
tendance at the showing of the Retailers Jewelers of
America,
Inc. in New York was heavy and exceeded
expectations. A
and loan associations stepped
their home lending in response
: to the challenge of the recession.
up
'
>
"In each month of 1958,
includ¬
ing those early months of the year
slight
when the economic news was most
rise occurred in the buying of men's Fall merchandise and volume
held close to that of a year ago. Wholesalers
reported slight
grim, American savings and loan
to-year gains in the call for children's back-to-sehool clothing.
for
year-
Purchases of furniture at southern markets
expanded notice¬
ably in the week and sales matched those
was
of a year ago. Volume in
sustained at the level of the
prior week. The
call for linens
improved but interest in draperies and floor cover¬
ing remained unchanged. There was a slight rise in orders for
refrigerators and automatic dishwashers, while the buying of
Over-all textile
in
woolens
and
were
Transactions
down
noticeably from the prior
the sales oi' carpet wool in
and light offerings limited
Philadelphia and Boston. Although volume in print cloths and
broadcloths picked-up somewhat, sales of other cotton
gray goods
lagged. New England dyers and finishers reported a slight rise in
incoming orders.
buying last week.
buying of canned fish and citrus juices offset declines in
canned fruit and vegetables. Volume in fresh meat,
and poultry expanded somewhat, while interest in
stitutions
breaking
thus
have
fresh produce
rice, flour and
•
disclosed
months
Federal
on
a
country-wide basis
as
taken from
Reserve
Board's index for the week ended Aug.
9,
1958, rose 1% above the like period last year. In the preceding
week, Aug. 2, 1958, an increase of 3% was reported. For the four
weeks ended Aug. 9, 1958, a gain of 2% was also recorded. For
the period Jan. 1, 1958 to
Aug. 9, 1958, a decrease of 2% was
reported below that of 1957.
Retail trade sales volume in
unchanged to between 2
and
New York
City last week
that
in
1958
index, department
New York City for the
weekly period ended Aug. 9,
declined 1%
below that of the like period last year.
In the
1958, a gain of 4% was reported. For
the four weeks ended
Aug. 9, 1958, an increase of 3% was reported.
For the period Jan.
1, 1958 to Aug. 9, 1958 an increase of 1% wasregistered above that of the corresponding
period4n 1957.
preceding week Aug. 2,
seven
of
that
said
on
the
present trends, it looks
of
if the
as
1958 home
loan volume
savings associations will exceed
figure which would
billion,
substantially
a
ahead
year's loan volume
of
last
of $10.4 bil¬
lion, and second only to the peak
lending figure of $11.4 billion in
the
record building year
With
of 1955.
Dempsey-Tegeler
(Special to The Financial Chronicle)
week of 1957, estimates disclose.
store sales in
Holzka
first
of 1958, January
Holzka
Mr.
basis
was
Reserve Board's
the
through
July, the home loan volume of
savings associations amounted to
nearly $6.5 billion, or a gain of
8% over the same seven months
of 1957.
;
4% above the volume for the similar
According to the Federal
an
toward
of the reces¬
the back
sion." ' ~
$11
dairy products dipped frattionally.
Department store sales
the
made
contribution
be
some
money
building mnd
enormous
Little change was noted in wholesale food
Increased
more
buying
comparable month of
1957," he commented. "These in¬
home
than in the
Statistics released by Mr.
trading slackened in the week.
worsteds
loaned
associations
air conditioners and fans lagged.
week
Commodities quoted higher
eggs and
?
a
children's
in
in
and
tcly
other markets
food
appeciable rise
an
$1,054,000,000.
sales of major appliances modRetailers reported a slight increase in
volume in air conditioners and trading matched that of a
year ago.
Despite slight increases from the prior week in upholstered chairs
era
were
mixed, both from the preceding
Failures climbed 50% above
July, 1957
was
when the home loan vol¬
was
tory, exceeded only by June and
August of 1955.
apparel.
A noticeable rise
the
July in the printing, publishing and steel industries. The
least change from a year
ago took place in retail trade where there
were marked
upturns in only three lines—automotive, drugs and
food.
ume
call for men's fall
furniture sales.
_
in 1955,
The
ST.
is
LOUIS
now
with
Mo.—Paul R. Estep
Dempsey-Tegeler &
Co., 1000 Locust Street, members
of
the
New
York
and
Midwest
Estep
in
the past was Wichita Manager
for
Stock
Exchanges.
Mr.
v
Volume 388
Number 5770
.
.
.
The Commercial and Financial Chronicle
Continued
Mutual Banks
Membership in ABA to Be
Voted Upon in September
Enlivenment of American Bankers' Assn.'s
held in
be expected
a result of proposed
banks from membership.
The Association's head, Joseph C. Welman, sees no need to
September,
can
as
amendment to exclude mutual savings
and procedures involved in bring¬
Welman
Mr.
each
member
pointed
bank
is
convention
American
the
of
than
more
bank is to
should
it
which
one
1
loans.
that
entitled
to
attend
be
to
in
advance
the
be
a
convention,
decided
is
one
the
from
official
"While
have
we
problems
in¬
volving the issues raised by Mr.
Roth," said Mr. Welman, "I feel
that these problems can be solved
the
without
ABA
denying
membership privileges to mutual
savings banks. I have previously
said
that
I
do
not favor
the pro¬
Howevei4, this
by
the
Executive
Council
and
for
action by the official delegates in
posed amendment.
is
matter
a
for
consideration
,
Joseph
C.
Welman
Bankers
viewed
Arthur
were
letter to
a
ABA
ber banks from Joseph C.
Association President.
The convention
will
re¬
mem¬
Welman,
dated
in
their
and
Aug.
the
in
Roth,
have
I
banks
total
cash
bank's
11,
convention.
a
1958,
heretofore
be regarded as a
primary
reserve
or
would
reserves
Net
exclude
items in the process rf col-
casli
position
reserve
for
informed
the number of trained engineers,
may
Indeed,
for product
expenses
re-
search and development increased
substantially during the year, but
h line with experience, the initial
to her dnnovatmhs designed to
offered
expense of setting up any program
°f improvement is usually the
greatest. As the program becomes
established, thei percentage of cost
allocated to it diminishes, and
collateral.
as
reduce S
may expose, a
(
bank to greater risk and at the
.'™ reduce liquidity. Banks
insured
all
Gains
if interest rates fall.
Longer-term loans
SK
commercial
equal
to
£™es a^suallyusedmsinL
the
balance
are
sheets
of banks
that
^romlhSTdali/an™£age *1^, ™°st beneficial long range
monthly payment and payoff fig- result?.,
a
J'™ was determined. This was in
About:^'ullVl
' as a Percentage, to
generally available do not show
breakdown of the items.
represented
were
coin
bv
and currency.
over
Primary
Secondary
and
method
Primary
an
the
little
carrv
eondSons
hanks
of
average
monthly
would be S1/^.
reserves
S
on
year,
Reserves
Mr.
;
The Company's Strong Financial
/
_
i«. .•
^
^ t."
*otal loans shown on the balr»lnpl_
ance sheet,, as of the end of the
Black,
' period. If the loan portfolio turned a strong
of assets in the primary re-
1.5%
that
stated
others that this
and
of
Terns,
prlmai'y reserved
served, particularly the increased
interest in complete oilfield "automation" at the wellhead, requirin&
services of an increase in
fcurity
of
form
bank
lection, which, in 1957, were equal
to 6.2% of assets. The net primary
«crve
circular letter
21.8%
the
from
mav
gross
primary
had
in
assets
due
These items
the voting will be by secret ballot.
Roth
be held
at
attendance
Roth
"Mr.
Association
in
T.
commercial
I Like Best
Credit risks are associated with
tile possibility that the borrower
will be unable to pay. All loans
involve some degree of credit risk
as do mos^ investments.
Loan
risks are difficult to predetermine
but are related • to the financial
capacity of the borrower and the
all insured
1957
obligations.
eminent
accrue
As of Dec. 31
simply its
delegate.
within
(5) Building, furniture, fixtures
and other assets.
..
The Security
market rates of interest. As interest rates rise, market values
decline.
This
risk
cannot
be
avoided, even on long-term gov-
quality loans.
(4) Long-term investments and
out
officer
Continued from page 2
.
(3) A good distribution of short-
ing a constitutional amendment one official delegate with voting
proposal to the floor of the gen¬ privileges, and he noted that, if
eral
15
page
term
deny membership to mutuals as proposed by Long Island
banker, Arthur T. Roth.
Information for voting delegates
from
The Management oi Bank Funds
UnderCuirentEconomicConditions
convention, to be
33
(733)
were
once
a.
percentage
About half of the
able
to
this
supply
ci«Qn0
s
n™*™
Sivalls & Bryson enjoys
financial position. Cur-
rent ratio at the midyear of 195&
]Yas a.$?.era*, ^
1, reflecting1
^be additional $2,500,000 raised
through the private placement ot
information. The lowest percent- 25>000 shares of a new preferred
Chicago, Sept. 21-24.
Delegates
serve
to provide the indWiiS'al »S«
of monthly payments and stock. If all goes well, this stock
will vote on a proposed amend¬
bank with liquidity.
The amount payoffs was 3.7% for a bank hold,In?, ? n
(ouy Je£!!s
.J
ment to the Association's consti¬
of primary reserves required of inS 33.5%
of its assets in real Probably be supplanted, through
tution that, if passed, would have
vention.
•
any bank will be governed by the
estate loans. The highest percent- retirements and the exercise of
the
effect
of
excluding mutual
"As
required by
Article XI, required reserves need for clear! age was 34.4 which means that attached warrants. These entitle
sayings banks from membership. Section 1, of the ABA constitu¬ ing and other correspondent serv- the average loan was paid off in t le holder to subscribe to two
nig aiii. uiiitH
With Mr. Welman's letter he in¬
^ P
"
,eiv
about three months
Most nf the
shares per. warrant to common
ices
and the amount ol cash on
,»oul ltnce months. Most oi the
Jf
cluded
a
copy
of
the
proposed
amendment, submitted by Arthur
T. Roth, President of The Frank¬
lin National Bank of Long
Island,
Square, New York.
This membership exclusion pro¬
Franklin
posal is expected to
convention's formal
enliven
of voting
will be recommended to
the general convention, but that
this, nevertheless, is a matter for
determination by the general con¬
tion,
will
submitted
to
the
Execu¬
tive Council at its meeting in
Chi¬
hand.
These, in turn, will be
lated
to
T
on
approval
then
be
the
and
bank
oaxiK,
int.
the
re-
the loca-
as
demands
a una jus
or
disapproval and will
submitted to the
general
ses¬
amount and mature
&
of
reserves die
are
producing,
which
against excessive hold-
the
on
two years.
can
say
how big
a
deficit the President
will forecast for fiscal 1960 in his
next
lem
budget message
January. But closer at hand there is the prob¬
of finding buyers for $10 or $12 billion U. S.
Government
securities
deficit in the face of
to
finance
the
fiscal
improving business
news
1959
and
prospect of strengthening private credit demands.
In addition to raising new money, and retaining a
market for $22 billion 91-day bills, the Treasury will
have to refinance $46.1 billion of marketable cer¬
a
tificates, notes and bonds maturing in the next 12
months.
an
emergency
by
way
stopgap, which gains some time.
*
#
*
/
most essential is getting Federal Govern¬
expenditures and financial commitments of
every type under control. It is not fair to ask any¬
one to buy bonds of a government which seems to
be embarked on deficits as a way of life.
"But
ment
"As President Grover Cleveland
wisely stated in
his last annual message to
way
turn
Congress, in 1896: 'The
to perplexing extravagance is easy but a re¬
to frugality is difficult.'
"Yet the
tional
task, in the end, cannot be escaped. Na¬
strength and solvency—the preservation of
free institutions and trust in
upon
ures
government—depend
facing fiscal facts."—First National City Bank.
We shall not
gild the lily!
for
single date
a
can
scarcely
regarded
but
the extremes, as of that date, refleet an inadequate primary rebe
serve
on
liquidity
one
on
hand
excessive
and
loms
As
items
reserve
(<>\
ire
pri
kif/h
(2)
mgn-grade,
(I)
-mri
ana
marketable.
Money
are
typically sec¬
ondary reserves. For most small
banks, this will mean short-term
government issues. Where to draw
the line in defining "short-term"
is debatable. If we draw it at five
easily
(3)
market
years,
term loans it needs to balance its
position with a higher percentage
nrimarv
and
items
it should be with
an
j
,
two
or
years,
,
?
/,
,
T
Outstanding debt through June,
*
'
_
.
d.41nnnftn
®
.
thp
inLjL
>> (he J°vabIe
jn
recent-top.yableto
UUU among current liabilities.
The net worth of the common'
the
em-
000 amone current liabilities
many stock at midyear, 1958, is $30.10
instances, the distribution of bank per share.
assets cannot be explained in
The first half of 1958 felt the
terms of any set of principles but brunt of the presently expiring
ploymcnt ot hank funds. In
is dependent upon individual be- recession, and the second quarter
an extension of satis-
*1
,
This kind of banking
Outstanding common shares at
not maximize profits but it present number 510,250. A decade
facilitate
does
«nnf\
n
mVM's
night's
sleep.
ago
™ur
snn non
the number was only 300,000
the net worth was
only
when
per share. Working capital
during the past decade more than
doubled—$17,311,331 as of Dec. 31,
$20.13
W
I
Pifcxx*-
Drtonc
ril8er
^Pens
(Special to Tiif Financial Chronicle)
RALEIGH, N. C.
xu
Harold L.
-—
Wtfices at
c?
fu
S
4.
r-
from
j ^57
$8 054 039
The pregent rate of dividend on
^For! the COmmOIJ sto^ Jf
^ T
num, 'a rate established at the
S® f£teeet under the firm name
of Pitser & Co.
represented
assets in sec-
factorily profitable operationsDividends Continuous Since 1939
ojfc assetsma>"
beginning of 1954;
rate
Lichtman, Mong Adds
The average
during the past decade was
$1.33
which is
37%
only
of the
annual average
for
balance available
dividends.
common
(Special to The Financial Chronicle)
that all insured commercial banks
of their
^
J,iese are just some of
mm]y factors that affect the
by bills, certificates and near ma¬
turity bonds and notes. Applying
the five-year definition, we find
19.9%
^
unjgto absorb money and
llsIvS«
under-
turUles will be concentrated withone
share.
CfteftWSO ° Wammt
vn
or , primary ana secondary reserves. The ratio of capital accounts is also sigmficaiat in mens-
standing that the bulk of the ma-
in
per
°!df
ondary reserves of well over 60%
ihnrf term
shoit-term,
market
eonnter
over-the-counter market
Slvl?£ ,a" cc)UIV£'lent
Befs and preferences. Many banks witnessed
the other.
oHil
ondarv
the
over
value to the stock of $26
tank
,
had
"What the Federal Reserve has done is
of
the
Kentucky study, the range of pnreserves was from 8.85% to
45.07% as of Dec. 31 1957. Fig-
Congress and Administration have chosen
provide stimulus to business in the recession by
increased Federal expenditures of almost all types.
This approach, more attractive politically than pro¬
viding stimulus to enterprise by tax reforms, has
been pursued with such enthusiasm that the Presi¬
dent had to confess on July 2 that there was no
prospect of regaining a balanced budget for at least
one
banks in
100
mary
"The
"No
individual
of
part
the
For
banks.
to
.
.
,
a
the second-
Primary
ruindiy
arv leseive.
,uy reserve
were
single payment loans in ^
a large Eround
to
non-income
Hear! Hear!
as
.
rommeveial
so^'and
militates
sion, Tuesday, Sept. 23."
considerably.
classified
*<> individuals. It also held
ings
ceedings
loans made by this bank
for
jui
Monday, Sept. 22, for its
convention at its first peneral
business pro¬
factors
such
oi
of
uoii
cago
present
amendment
proposed
this
be
risk
MFNT n
MENLO
^
c
0
•
PAT?K
PARK,
Talif
Ppfor
Calif. —Peter
^
The Present total of both PTGT
ferred
and
common
dividends ^
is
Dec. 31, P-o. Baird, Raymond E.Giorgi and onjy abGut half the net earnings
1957.
Total primary and second,an, 7"
J"^ve been of
past decade—$862,791 verary reserves were equal to 41.7%. ??
^
SUs $1,641,484.
These figures may be used as a M°nS & Co., 1139 Chestnut Street.
On
its
historical record,
the
guide for individual banks if it is
common stock, in my opinion, is
remembered that special circum¬
Joins First Sotithern
attractive—especially so for an
stances may require a higher per¬
(Special to The Financial Chronicle)
centage or facilitate a lower per¬
equity with the assured growth
centage.
Some shifting between
potential inherent in the. comthe
primary and secondary re- has become associated with The
First Southern Corp., 652 Peach- pany's area of productive activity.
serves is also permissible.
Most of the remaining assets tree Street, N. E.
ondary
reserves
as
of
«
may be regarded as "risk assets,"
although non-marketable govern¬
ment securities
can
usually be
With Hooker & Fay
classification.
(Special to The Financial Chronicle)
excluded from
this
The risks involved may be
money or
credit variety or even a
Money risks are usually associ-
items
and
are
due
SAN
of the
combination of both.
ated with longer-term
Joins York & Co. Staff
Calif,
FRANCISCO,
Calif.
Paul R. Ferwerda is now
—
affiliated
Laurence H. Easterling, Jr. has with York & Co., 235 Montgomery
joined the staff of Hooker & Fay, Street, members of the Pacific
221 Montgomery Street, members Coast Stock
investment of
to
FRANCISCO,
(Special to The Financial Chronicle)
SAN
the
New
York
and
changing Coast Stock Exchanges.
Exchange.
Pacific previously with First
Company.
He was
California
34
The Commercial and Financial
Chronicle
<734)
Securities
Now
Co., Atlanta, Ga.
of common stock (par $1)
to be offered for subscription by common stockholders
at the rate of three
shares for each two shares held
new
of record June 30,
holders,
Price—$6.25 per share to share¬
any unsubscribed shares.
Pro¬
working capital and general corporate pur¬
and
ceeds—For
poses.
1
1958.
$7.50 for
Underwriter—None.
Aircraft
Armaments, Inc., Cockeysvilie, Mid.
July 16 (letter of notification) 70,000 shares of common
stock (par $1) being offered for subscription by minor¬
ity stockholders of record July 10, 1958 at rate of
seven new shares for each eight shares held
(with an
oversubscription privilege); rights to expire on Sept. 5.
An additional 280,000 shares will be subscribed for by
parent, United Industrial Corp., at the same price. Price
—$2.50 per share. Proceeds—To reduce its present short
term
indebtedness
equipment.
and
to
procure
production
and
test
Underwriter—None.
American-Caribbean
Oil
Co.
(N.
v
named
(par 200).
Proceeds — To
Un¬
by amendment.
American Mutual Investment Co., Inc.
Dec. 1? filed 490,000 shares of capital stock. Price—$10.20
share. Proceeds—For investment in first trust notes,
second trust notes and construction loans. Company may
develop shopping centers and build or purchase office
buildings. Office — 900 Woodward Bldg., Washington,
per
D.
C.
Underwriter
None*. Sheldon Magazine,
Highland Drive, Silver Spring, Md., is President,
1201
—
in cash or in State of Israel
Independence Issue or De¬
velopment Issue bonds. Proceeds—For development and
expansion of agricultural, industrial and commercial en¬
terprises in Israel. Underwriter—None.
offered
be
For
—
to
members
working
of
capital.
the
Under¬
'
Bankers Fidelity Life Insurance Co.
Feb. 28 filed 258,740 shares of common stock
(par $1),
of which 125,000 shares are to be offered
publicly and
133,740 shares to employees pursuant to stock purchase
options. Price—To public, $6 per share. Proceeds—For
expansion and other corporate purposes. Office — At¬
lanta, Ga.
Underwriter—None.
V'/-'-'
Bankers Management Corp.
Feb. 10 filed 400,000 shares of
(8/27)
v
common stock
(par 25
Price—$1 per share.
Proceeds—To reduce out¬
standing indebtedness and for working capital. Office—
Houston, Texas. Underwriter
McDonald, Holman 8/
Co., Inc., New York.
v
!
Southern, Inc.
\
April 14 filed 8,934 shares of common stock. Price—At
par ($100 per share).
Proceeds—For general corporate
purposes.
Underwriter
Bankers
Bond Co.* Louis—
14,700 shares of class B
stock (par $1).
Price—$12 per share. Proceeds
—To go to selling stockholders.
Office —700 N. 44tb
Street, Birmingham, Ala. Underwriters — Cruttenden,
Podesta & Co., Chicago, 111.; and
Odess, Martin & Herzberg, Inc., Birmingham, Ala.
Anita Cobre U. S. A., Inc.,
Phoenix, Ariz.
Sept. 30 filed 85,000 shares of common stook. Price—At
par ($3.75 per share). Proceeds—For investment in sub¬
Underwriter—Selected Se¬
Budget Finance Plan, Los Angeles, Calif. '(9/26)
June 10 filed 132,000 shares of 6% serial
preferred stock
($10 par). Price—To be supplied by amendment. Pro¬
ceeds—To be used in conjunction with
proposed
of company
and Signature Loan Co., Inc.
& Co., New York.
Underwriter—
Cador Production
Corp., Far Hills, N. J.
'
/
1,003,794 shares of class A stock (par $1).
and 150,569 shares of class B stock
(par 60 cents), the
class A shares to be issued in
exchange for oil and/or
gas properties and the class B shares to be issued as com¬
Aug. 7 filed
missions.
Underwriter—Cador, Inc., Far Hills, N. J.
Aug. 12 (letter of notification) 42,800 shares of common
stock
(par $1). Price —$7 per share.. Proceeds
For
working capital. Office—239 North Howard St, Glendale, Calif. Underwriter—J. A. Hogle & Co., Salt Lake
—
City, Utah.
"
v;
.
.
4
filed
230,875 shares of
r
...•
stock
common
(par $1)
These
shares are issuable upon conversion of an
gregate principal amount of $923,500 of 10-year 3%
vertible subordinated income notes of the
a
ag¬
con¬
limited partnership, which notes were assumed
by the
Dec.; 31, 1,957.
The notes are convertible al
company
time aftqr July 1„ 1958, until the
maturity or prior
redemption of the notes at a conversion price of $4
per
share. Underwriter—None.'
77
■.
::-/7
/
any
.
.,
Minn.
Canada Dry Corp.
(8/27).
,
stock (par $'1.66%)
subscription by common stockholders
of record Aug.
26, 1958 on the basis of one new share for
each five shares
held; rights to expire on Sept. 11. Price
—To be supplied by amendment. Proceeds—For
repay¬
ment of bank loans, to purchase and irtfetall
machinery,
and for -working
^capital./; Underwriters—Eastman Dil¬
lon, Union Securities & Co^ -. Horn blo wer-; & Weeks, and
Winslow, Cohu & Stetson, oil of New York
v.
"
be
offered
Carrtone
;
for
Laboratories,
.< New Orleans)
"
.V
•.
.
•
(
'jL'i
li'fv
i
filed
2
Inc., Metairie
La.!C*.
••'"/'ft'''
,j*'
.'
-
,«>,
'
W
'»
4
'
-s
June 4. filed
August
25
working capital
and
V;.' "■'i
Oils
cpmmont stock
(par 10
Proceeds—For expansion,
share.
per
writer—None.
other .corporate. purposes- Under¬
7.,'//
;
Inc.,
.';".X7yr- r
Seattle,
r
Wash.
July 30 filed 1,000,000 shares of common stock. Price—
At par (10 cents per share).'' Proceeds
—For; drilling
costs.,
Underwriter.—None, Offering'to be
made through
Evans, President and Vice-Presi-
A. R. Morris and H. C.
dent, respectively,
Arcade
on
best-efforts basis.
a
Building, Seattle, Wash.
Cinemark II
Office—4112
"7 ' 7 '7 '
-
7;" | 7'
•
Bids
9
a.m.; PDT)
August 26
Electric
Power
Co.,
/:/;••'
Columbia & Rensselaer Telephone
Corp*
Aug. 4
(letter of notification)
7
2,800 shares of
;
common
(no par) to be offered for
subscription by stock¬
holders at the rate of one, new share for each 2.572
shares
held.'/; Price—$60 per share. Proceeds—For
construction
of. new telephone plant.
Office—-19 Railroad
Avenue,
Chatham/N...Y; Underwriter—None',
77 7
t
Commerce Oil Refining Corp.
Dec.
18
filed $25,000,000 of first
mortgage bonds du«
Sept. 1, 1968,. $20,000,00 of subordinated, debentures due
Oct. 1, 1968 and 3,000.000 shares, f common stock to be
offered inomits as follows: $l,00o of bonds
and,48 sharei
7'
7
$50,000,000
September It
..
(W.
J
(Tuesday)
(Cruig-Iiallum,
C.
Langl.ey
&
*
;
Co.t„$3,500,000
September 15
Gulf
L——Common
Inc.)' $190,000
7
(Thursday)
.Western. Development ,Co.-_*_i_--Debentures
'
;
r
..
.
(Monday)
/,.
/
-
;
C
States Utilities Co.—_.___^Bonds
7;
(Bids to be invited)".,$17,000.000
•
'
Arizona
Color
Film
Processing
July 14 filed 500,000 shares
A recission
offer
is
of
Laboratories
common
being made with
(par $1).
respect to stock
land,
building and equipment, and working capital. Office—
SgQttsdale, Ariz. Underwriter
None.
Statement ef¬
fective Aug. 4,
—
cumulative con¬
Price—To be supplied
by amendment. Proceeds—$1,150,000 is to be used for
repayment; of funds borrowed from James
Talcott, Inc.,
oq. assignment of accounts receivable
and; warehouse re¬
ceipts; $40,000 for the purchase of additional
-r-Miami. Fla.
Chicago, 111. •'
Underwriter—Cruttenden,
$20,000,000
„
(Cruttenden,
Bankers
Podesta
Management
^McDonald,
&
Rassco
Preferred
i
Co.)
Co
Winslow,
Holman & Co., Inc.)
(R.
$400,000
»
&
Stetson)
392.611
shares.
Co.,
11. a.m.
Inc.)
102,566.shares
&
Brothers)
$24,0f00;000
/
September 4
7
%
-
-
Co.; Wiiite, Weld
Co;) $9,000,000 «
&
Stevens
Markets
(R,
S.
(Tuesday)
'
-
Finance
Common
& Co. >r 100,000 sharps,
w' ■"
"
'1
'.
*
.
(Wednesday )c
'\,Y;
Indiana, Inc.-—Preferred
$24,282,600
/
(Tuesdgy )'
.
a.mrEDTi
$35,000,000
Preferred
—
-
-
.
_
_
.
(Friday)
___
Hammill •&
-
7-
_
-
(Offering
»-r- —
to
^^
stockholders-=.no
Southwestern
Bell
v
.
1
<Bids 11:30
60WI 1)10n
$70)096.100 "
$110,od0;000
s
ami;
—
]
Debentures
(Wednesday) ;
National FueLGas Co
.
-
"r-r*.—
underwriting)
Telephone Co_—
(Bids'to be Invited)
•
Preferred
September 30 (Tuesday)
October
Bonds
_
Co.). $1,320,000-
Mountain States Telephone & Telegraph
Cq«;
'
—Bonds
plan
-
-
:—Debentures
EDT). $25,000,000'
*
,
Preferred
Co..
Inc.): $J466,050)
Washington Natural Gas Co.——
Witter
11
(Shearson,
-
Com.
$10,000,000
Inc
Dickson: &
(Dean
.
September 26
(Wednesday)
EDT)
>
(Morgan Stan-ley & Co.) $15,ft00,000
(Bids noon EOT}
$20,000,000r
a.m.-
$1,000,000
(Tuesday)
,
Utah Power & Ugbt
Co.—^——
11
*
Power- Co.—™„>^_JBonds
(Bids
&
*
shares'
Inc
Pea body
•.„.
—
(Bids
Service
Consumers Power Co
-
•
September 16
"Corp.»
16
September 2^
Consumers
(Kidder, Peabody & Co.); $8,580,000
.
Israel
(Blyth & Co., Inc.'
(Thursday)
September 9
125 000
*
North Carolina- Natural: Gas
Corp.—Debs. &
your
Co.)
Corp7_____Debentures
Public Service Co. of
(Tuesday)
Curtis; Smith, Barney
andi F; Eberstadt &
&
September 17
$8,000,000
South Carolina Electric & Gas Co.^
Gas
(Kidder,
.
-
Tribune representative?
widely circulated market table pages
.'a
.
7
-
Bondjt
EDT)
September 2
any
most
Bonds
^
Lehman
September
^
Other newspaper.in the midwest. Why.not talk about it
today-
Mid America's
,
.
-
Pennsylvania Power Co.—
(Bids
v
Budget
securities in the. Chicago Tribune. In the Tribune,
your messaap rwU have
greater circulation and influence than in
and
Staats
ORassco
Suburban
..
.
Inc.—.-^Common
S. Dickson &
WORTH BIDDING FOB!
GMATIU. KIWIfAMt
7/
.....Common
Cohu
One-Hour Valet,
R.
Financial
"
-
..Common
(Offering to stockholders—to be underwritten by Eastman
Dillon, Union Securities & Co.;. Hornblower: & Weeks; and
Co.
worth bidding for, That's how
many
stockowners live in Chicago and Mid
America. Their
holdings
iq stocks alone exceed $20 billion. You can make a
strong
bjdffcf; th§*r; future: investment plans by
Co.
$1,200,000
Office
arc.
&
(William
(Wednesday)
Arnold Altex Aluminum Co._^
Podesta & Co.,
advertising
Loeb
.
Grace Line Inc.„—Santa, Rosa
Bonds
/'Merrill Lynch, Pierce, Fenner
Smithy Paine, Webber,
iayestoj^
/Kuhn.
*
August 27
Jackson
with your
EDT)
noon
-
Pacific Autpmation Products Inc.—^——Common
equipment;
for general corporate
purposes.
Moore-McCormack Lines, Inc.
Bonds
Canada Dry Corp
Arnold Altex Aluminum Co.
(g/27)
July 28 filed 300,000 shares of 35 cents
and' the balance
Co
(Bids
stock
offered beginning April 8, 1958 to residents of the
State
of Arizona. Price—$2 per share. Proceeds—For
vertible preferred stock
(par $4).
Montana Power
&
Co.)
100,000
shares
•
Common
:
Acequia Madre Rd.,
Underwriter—Watson & Co., Santa Fe,
;'V/;7";•
.
777; > 7: : 77 7 ,7-7
Santa Fe, N. M.
N. M.
Bonds
Inc.-
;
Productions, Inc.
June 30 (letter of notification) 300,000 shares of
common
stock (par 10
cents). Price—$1 per share.-Proceeds—
For working capital. Office — 937
(Monday)
Southern California Edison Co
'
.
600,000 shares .br
cents).. Price—$5
Central
common
NEW ISSUE CALENDAR
,
$8,450,000.
Underwriter-r-None. Statement effective July 7.
(pollings Henderson on the American and To¬
Stock Exchanges.
Price—At market. Proceeds—
selling stockholders. • Off ice—Toronto, Canada. Un¬
derwriter—None.
■/'■;'/'•//'/7-7'.^'7To
stock
Calidyne Co., Inc., Winchester, Mass.
June
'
;
.
.
Arden Farms Co., Los Angeles,
Calif.,
172,162 shares of common stock (par $1)
being offered for subscription by holders of outstand¬
ing oommon stock at the rate of one new share for each
five shares held on July 7, 1958;, rights to
expire about
Sept, 22, 1958. Price—$14 per share. Proceeds—To
pay
off an equivalent portion of the
company's current bank
loans which, at May 15, 1958, amounted to
of A. M.
ronto
merger
Calidyne Co.,
Apache Oil Corp., Minneapolis, Minn.
July 28 filed 94,766 shares of common stock (par
$2.50)
to be offered for
subscription by stockholders at the rate
o$ one new share for each four shares held about
Aug.
18, 1958. Rights to expire on Sept. 2. Price—To be sup¬
plied by^ amendment.
Proceeds—For working capital.
Underwriter—Piper, Jaffray & Hopwood, Minneapolis,
(latter proposes to distribute said shares
ratably to its
of record Dec. 16, 1957).
The remaining
100,000 shares are to be sold for the account of the Estate
stockholders
July
vine, Ky.
•
ISSUE
March 10 filed
606,667 shares of capital stock (par $1),
of which
506,667 were issued in connection with the ac¬
quisition of all the assets of Yorcan Exploration Ltd.
to
cents.)
Bankers
REVISED
Aug. 6 filed 392,611 shares of
..
★ Cal Ray Bakeries Inc.
Anderson Electric Corp.
Dec. 23 (letter of notification)
sidiary and working capital.
curities, Inc., Phoenix,, Ariz
To
Proceeds
Shearson, Hammill
Ampal-American Israel/ Corp., New York
Aug. 8 filed $3,289,100 of 10-year discount debentures,
series E.
Price—61.027% of principal amount, payable
common
debentures.
writer—None.
ITEMS
•
PREVIOUS
Campbell Chibougamau Mines Ltd.
(par
$50) and $1,500,000 of 5% subordinated registered deben^
ture notes, second series, and $606,000 of 5%
coupon
association.
ADDITIONS
SINCE
Inc., Seattle, Wash.
.
stock
discharge current liabilities and to drill ten wells.
derwriters—To be
Associated Grocers,
—
Y.)
Feb. 28 filed 500,000 shares of common
Price—To be supplied by amendment.
Registration
June 30 filed 4,788 shares of common capital stock
bearer
Thursday, August 21, 1953
.
★ INDICATES
in
Acme United Life Insurance
June 30 filed 315,000 shares
.
.
October 21
(Tuesday)
.
_
Cincinnati & Suburban Bell Telephone Co.—.Bebs,
(Bids to be received) $25,000,000
Volume 188
Number 5770
.
The Commercial and Financial Chronicle
..
of stock and $100 of debentures JMld nine shares of stock
Price—To be supplied by ameuvunentv Proceeds — Tc
Inc. (8/26)
(letter, of notification) 30,000 shares of class A
stock (par $5). Price—$6.60 per share. Proceeds
—For general corporate purposes.
Office — 2127 East
refinery. Underwriter—Lehman Brothers, New
Offering—Indefinite. -
Consolidated Cuban
Petroleum
common
Lake
Corp.
v
filed
20
$400,000 of 4%
subordinated debentures,
cumulative preferred stock (par
10,000 shares of 4%
$100) and 200,000 shares of common stock (par
Price—At par. Proceeds—To be added to working
ital. Office—Ithaca, N. Y, Underwriter—None.
•
Underwriter
Louis.
Counselors
—
Researchv Sales
Robert H. Green is President.*
Cuban-Venezuelan Oil
Corp.,
stock.
Price—
Ore.
St
Voting Trusts,
Underwriter—None.
Exploration Service Co., Ltd., Far Hills, N. J.
Aug. 11 this company and Amkirk Petroleum Corp.
(latter of Fort Worth, Texas) filed $400,000 of working
interests (non-producing in Sinu Valley Project), to be
offered for sale in $12,500 units (of which $8,000 is pay¬
able in
March 31 filed 767,838 units of voting trust certificates
each certificate representing the ownership of one share
cash and $4,500 is to be represented by
Price—To
be supplied by amendment.
Proceeds—For
working capital and other corporate purposes. Under¬
writers—Joseph Mandell Co. and Louis L. Rogers Cb.,
promis¬
notes). Proceeds—Exploration Service Co. to ac¬
quire 80% interest in a certain concession from Amkirk
sory
both of New
holders at the rate of
fife
held
12,
22.
of
record
Price—$20
Aug.
new shares for each 17 shares
1958; rights to expire on Aug.
share to stockholders; to public $21
share.;; Proceeds — To finance, additional building,
per
per
machinery, equipment, anclTor working capital. Office
Sandy Hook, Conn. Underwriter—Smith; Ramsey & Co.,
Inc., Bridgeport. Conn. ••/*vvv
• t':„ -
Daybreak Uranium, Inc., Opportunity, Wash.
29 filed 1,156,774 shares of common stock (par 11
Jan.
of company
holders.
and 526,774 shares for selling stock¬
Price—At
Proceeds—For
market.
exploration
and drilling costs and other corporate purposes. Under¬
writer—Herrin Co., Seattle, Wash.
of bonds and
class A
stock of the Houston
Corp., to be offered for subscription
by the holders of common stock of Delhi-Taylor of rec¬
ord May 23, 1958 on a l-for-10 basis (with an oversub¬
scription privilege). Each depositary unit will represent
the beneficial ownership of
one
share of class A
stock of the Houston Corp. and* (b) an irrevocable option
to
8,945/10^000ths of one additional share of
during a two-year period com¬
mencing on Aug. 15, 1959, or such earlier date as may
be determined. .Price—To be supplied by amendment.
Underwriters—Lehman Brothers and Allen & Co., both
rOf New York.
purchase
class A stock of Houston
Dersott Mines Ltd.
June 5 filed 350,000 shares of common stock.
Price—$1
share. Proceeds—For new equipment, repayment of
loan, acquisition of properties under option, and other
corporate purposes. Office—Toronto, Canada, and Em¬
porium, Pa. Underwriter—None.
per
June
stock
of
June
on-
the
ceeds—For
20, 1958.
Price—$1.10
per
April
maximum
of
one-half
his
of
•
be
Dixon Chemical
*
-
& Research,
,
be
offered
the
for subscription
of
rate
one
Price—To
be
expansion
and
N.
Clifton.
New York.
J
.
by
share
new
York;
supplied
each
amendment.
by
to be
•
ceed
.shares
an
offered
efforts
stock
an
undetermined
not
Plan.
Stock
will
book
be
value.
and
purchased
on
:
Office—136 East 38th
Underwriter—Capital
num¬
open
Avenue, Washington 6. B. C.
in¬
•
Dance
Studios
(Metropolitan New
Valley
Inn
operate an activities building, comprising a restau¬
Office—3938 WilUnderwriter—Oscar G.
Calif.
Calif.
General Aniline A Fvtm Corp., New
York
14, 1957 filed 426,988 shares of common A stock (no
and 1,537,500 shares of common B stock (par $1)
Proceeds—To the Attorney General of the United States
Underwriter—To be determined by competitive bidding
Probable bidders: Blyth & Co., Inc., and The First Bos¬
ton
Corp.
(jointly): Kuhn, Loeb
& Co.; Lehman
Brothers, and Glore, Forgan & Co. (jointly). Bids—Had
been scheduled to be received up to 3:45 p.m. (EDT) or
General
March 31
stock
—None.
•
.
-*-:t
•
Underwriter—None.
Houston Corp.
July 3 filed 818,333 shares of common stock (par $1) and
575,869 shares of class A stock (par $1) being offered to
of outstanding common, on the basis of 1.51
times for each share of common stock held and approxi¬
381,273 class A
subscribe With
respect to 133.850 outstanding class A shares has been
waived. The offer to common stockholders will expire
on
Aug. 26, and to class A stockholders on Sept; 2.
Price
$10 per share. Proceeds — For expansion and
working capital. Underwriter—None.
mately 1.5 shares of class A stock for each
share held as of Aug. 19.
(The right to
—
^
Refrigerator Co., St. Louts, Mo.
'
June 27 filed 21,584 shares of common stock, (par $5 be¬
ing offered in exchange for the issued and outstanding
shares of common stock (par $5) of Duro-Consolidated,
Hussmann
Duro common which may be
conversion of Duro's $200,000 subordinated
debentures, series of 1956. Offer expires
Inc., and for the shares of
issued upon
convertible
on
Aug. 25.
40,606 shares of com¬
(par $1)* to be offered
Washington, D. C.
Industrial Minerals Corp.,
July 24 filed 600,000 shares of common stock (par
cent). Price—$1 per share. Proceeds—To develop
operate graphite and mica properties in Alabama.
derwriters—Dearborn & Co. and Carr-Rigdom &
both of Washington,
D. C., on a best efforts
on©
and
Un¬
Co.,
basis.
(N. Y.)
Industro Translator Corp.
stock (par 10
the market price. Pre»eeds—For working capital and to enlarge research and
tevelopment department. Underwriter — S. D. Fuller &
Co., New York. Offering—Being held in abeyance.
28
filed
150,000 shares of common
^ents). Price—To be related to
Insured
Accounts Fund,
Inc., Boston, Mass.
•
May 12 filed 5,000 shares of common stock. Price—$5,060
per share. Proceeds—For investment. Business—To in¬
vest primarily in share accounts insured by the Federal
Savings and Loan Insurance Corp., in savings and loan
issociations throughout the country. Underwriter—None.
Ben H. Hazen is President.
Device*, Inc., Princeton, N. J.
(letter of notification)
for subscription by
stockholders at the rate of approximately 18.5 shares
tor each 160 shares held about April 15; unsubscribed
shares to public. Price—$3 50 per share. Proceeds—For
expansion, equipment and working capital. Underwriter
mon
Ariz.
Feb.
May 13 at Room 654, 161 Indiana Ave., N. W., Washing¬
ton 25. D. CM but bidding has been postponed.
Bldg.,
Street, New York 16, N. Y.
Corp., 1346 Connecticut
been
best
Jan.
•
Reserve
have
a
par)
•
Drinks, Inc.
July 28 (letter of notification) 200,000 shares of common
stock, (par five cents). Price—$1.50 per share. Proceeds
—For working- capital and* reducing current indebted¬
ness.
SEC.
Astaire
proceedings
order
.shire Blvd., Los Angeles,
Werner & Co., Pasaderia,
to ex¬
the
Office—Masonic
Stop
Beach, Fla.. on
rant, cocktail lounge and coffee shop.
held
>
P. O. Box 2518. Tulsa, Okla.
Inc.. of Miami
Aug. 6 (letter of notification) 300,000 shares of common
stock. Price—At par ($1 per share). Proceeds—To erect
aggregate value of $50,COO in any year to be
employees pursuant to an Employee Stock
Price—At
Co.
York), Inc.
Aug. 7 (letter of notification) 299,940 shares of common
stock (par 10 cents). Price—$1 per share. Proceeds—For
constructing and furnishing new dance studios. Office—
487 Park Ave., New York, N. Y.
Underwriter—Willis
E. Burnside & Co., Inc., New York, N. Y.
Proceeds—Foi
(par $100)
basis.
Fred
I
common
Co..
stituted by
to
Purchase
market.
of
Port & Terminal
Pierce
&
v..-.
Hoagland & Dodge Drilling Co., Inc.
June 12 filed 27,000 shares of capital stock. Price—$10
per share.
Proceeds—To be used in part for the ex¬
ploration of mines and development and operation of
mines and in payment of indebtedness. Office—Tucson,
holders
amended.
Fort
—Atwill
corporate' purposes.
Office —
Underwriter—P. W. Brooks & Co.. Inc
(letter of notification)
12
of
filed
26
^
15-
L. I.,
stock (par $1).
Proceeds—To
pay some $174,000 of outstanding indebtedness and to
complete phase one of the port development plan, at a
cost of $1,425,248, and the balance will be added to
working capital. Office—Fort Pierce, Fla. Underwriter
ir Dresser Engineering Co.
ber
Co., Great Neck,
May 23 filed 2,138,500 shares of common
Price—To be supplied by amendment.
-?will he withdrawn.
Aug.
Stone &
•
general
.
Development Corp.
Laboratories, Inc.
150,000 shares of capital stock (par 10
cents). Price—$2.50 per share. Proceed*—For sales pro¬
motion of company's products, working capital, addi¬
tional inventory and accounts receivable, for research
and development and for other general corporate pur
poses. Office—Brooklyn, N. Y. Underwriters—Statement
u
Offering—Indefinitely postponed. Statement
Other financing may be arranged.
on
Forest
Fremont
shares
payment for improvements
other liens upon the
Underwriter—None.
Schwerin,
and
March
stockholders af
four
in
N. Y.
Inc.
common
for
issued
to
directors.
it Gulf States Utilities Co. (9/15)
Aug. 14 filed $17,000,000 of first mortgage bonds, series
A, due 1988. Proceeds—Together with cash on hand, to
redeem and retire $17,000,000 principal amount of 4%%
first mortgage bonds due 1987. Underwriter—To be de¬
termined by competitive
bidding.
Probable bidders:
Halsey, Stuart & Co. Inc.; Lehman Brothers; Merrill
Lynch, Pierce, Fenner & Smith and White, Weld & Co.
(jointly); Stone & Webster Securities Corp.; and Salo¬
mon
Bros. & Hutzler and Eastman Dillon, Union Se¬
curities & Co. Bids—Expected to be received on Sept.
(par one cent). Price—$1 per share. Proceeds—
development of land, promotion and sale of existing
properties, payment of mortgage and working capital.
Office—438 Mercantile Bank Bldg., Miami,. Beach,. Fla.
Underwriters — James Anthony Securities Corp., New
-
Dec. 24 filed 165,625 shares of common stock (par $1)
Md.
writer—None.
For
to a
the de¬
:
nine
in mul¬
stock
for
in addition to the
initial price of the Partnership Interest. Underwriter—
■.
or
Price—100% of principal amount. Pro¬
solely for purchase of notes and other
National
Florida
velopment fund of the Partnership,
None,
payable
notes,
in units of $100
Aug. 7 (letter of notification) 300,000 shares of common
up
subscription
12%
of
issue
improved properties.
share. Pro¬
Office—
assessed
Inve^t^
organizers,
incorporators,
management,
Price—$10 per share. Proceeds—For
working capital and general corporate purposes. Under¬
homes and secured by mortgages or
Ltd., Wichita Falls, Texas'
Price,
per unit.
Proceeds—For the exploration, develoment and operation of oil and gas properties in any
state or territory of the United States.. The prospectus
may
per unit. Pro¬
purchase the Belle-
Inc., Clifton, N. J.
filed* $1,000,000
after date of
tiples thereof.
14 filed 300 Limited Partnership Interests.
subscriber
Guardian Insurane* Corp., Baltimore,
ceeds—To be used
—810.000
each
held; war*
Aug. 16, 1957, filed 300,000 shares of common stock,, of
which 200,000 shares are to be publicly offered and the
remaining 100,000 shares reserved for issuance upon ex¬
for equipment; and
Underwriter—None.
Backers Co.,
7
months
Dillard Associates
that
shares
Wayne, Ind. Underwriter—Northwestern
Inc., 502 Gettle Bldg., Fort Wayne, Ind.
and/or
W. Adams Blvd., Culver City, Calif. Underwriter
—Lloyd Arnold & Co., Beverly Hills, Calif.
states
seven
warrant
First
5837
Aug.
ment
Price—$7,500
to
share for each
ercise of warrants which are to be sold at 25 cents per
of the company.
general fund
Baton Rouge, La.
contract
a
new
working capital.
10 shares held until the close of
share for each
one
business
over
one
mont Motor Hotel in Baton Rouge;
Diketan
Laboratories, Inc.
10 (letter of notification) 43,336 shares of common
(par $1) to be offered to stockholders on the basis
$500 of notes.
take
ceeds—To
best efforts basis.
expire Sept. 20, 1958. Unsubscribed shares to* be
offered to stockholders until Oct. 20, 1958; then tip pub¬
lic.
Price—$3 per share. Proceeds—Fof general: funds
to be used for expansion. Office—119 W. RudisilT Blvd.,
July 31 filed 400 shares of common stock (no par) $500,000 of 6%: debenture bonds and $50,000 of promissory
notes to be offered in units of four shares of stock. $5,000
indebtedness
Delhi-Taytor Oil Corp., Dallas, Texas
July 15 filed 575,869 depositary units for the
(a)
Louisiana Corp.,
on a
rants to
Fort
cents), of which 630,000 shares are to be offered for ac¬
count
basis of
York, N. Y.
Fields'
York,
★ Great Northern Life Insurance Co.
Aug. 12 (letter of notification) 31,011 shares of com*
mon stock (par $1) to be offered to stockholders on the
stock
common
*
option to be offered for the account of the underwriters.
and for exploration program. Underwriter—Cador, Inc.,
(par one-half cent) in each of 24
Far Hills, N. J.
-Cuban companies.
Price — To be supplied by amend¬
ment.. Proceeds—For capital expenditures, exploration
Federal Commercial Corp.
costs and other corporate purposes,. Underwriter—None ./ May 21
(letter of notification) 300,000 shares of common
stock (par 10 cents).
Price—50 cents per share. Pro¬
".'Curtis (S.) & San Inc/
ceeds—To make loans, etc. Office — 80 Wall St., New
July 18 (letter of notification) 5,000 shares of common
York, N. Y. Underwriter—Dumont Securities Corp., New
stock (par $10) being offered for subscription by stock¬
of
Underwriter—None.
★ Great American Realty Corp., N. Y.
Aug. 18 filed 484,000 shares of class A stock (par 10
cents). Of this stock, the company proposes to offer
400,000 shares and certain selling stockholders 40,600
shares, the remaining 44,000 shares being subject to
'
Havana, Cuba
-
filed 300,000 shares of common
tion.
•
:
~
★ Golden Hills Motor Hotel, Inc.
*
Aug. 11 (letter of notification) 1,600 shares of common
stock.
Price—At par ($50 per share).
Proceeds—Fdr
working capital. Address—P. O. Box 775, Pendleton,
($5 per share). Proceeds—To cover operating
during the development period of the corpora¬
par
expense
Research Fund, Inc., St, Louis, Mo.
100,000 shares of capital stock, (par one
Price—At market.
Proceeds—For investment.
cent).
general corporate purposes.
Office—1 B.
Street, New York 16, N. Y. Underwriter—Jamea
Anthony Securities Corp., 37 Wall St., New York 5, N. t,
85th
Ethodont Laboratories, Berkeley, Calif.
Feb. 20
cap¬
Corp.
ceeds—For
(letter of notification) not in excess of $300,000
aggregate value of common stock (par 50 cents). Pro¬
ceeds—To selling stockholders.
Underwriter—Bateman,
Eichler & Co., Los Angeles, Calif.
At
filed
5
^ Electronic Specialty Co., Los Angeles, Calif.
V
$5).
Counselors
Feb.
Glassheat
-
Feb. 12 (letter of notification) 150,000 shares of eta* A
common stock (par 10 cents). Price—$2 per share. Pri-
Aug. 3
Cooperative Grange League Federation
Exchange, Inc.
June
Underwriter—Craig-Hal-
(8/25)
-r-.-r.i.
Underwriter—None.
St., Minneapolis, Minn.
35
Georgia Casualty A Surety Co., Atlanta, Oa.
May 6 filed 450,000 shares of common stock (pat $1).
Price—$6 per share. Proceeds — For general corporal*
purposes. Underwriter—Buckley Enterprises, Inc.
lum, Inc., also of Minneapolis.
July 1 filed 419,000 outstanding shares of common stock
(par 20 cents). Price—Related to the current1 market
price on the American Stock Exchanger- Proceeds—To
selling stockholders.-
Electric Power Door Co.,
•
Aug. 8
construct
York.
(735)
International Opportunity
June 2 filed 5,000,000
Price—$5 per share.
Life Insurance Co.
shares of common
stock (par $1).
and
Under¬
Proceeds—For working capital
other corporate purposes. Office—Denver, Colo.
writer—Columbine Securities Corp., Denver, Colo.
Continued oil pttge 36
,
The Commercial and Financial Chronicle
(736)
56
jplice—$24
Continued from page-o5
Realty Mortgage &
Investors
$250,000
filed
24
Juh*
Financial Corp.
of investors income certificates
10~vear maturities) and 125,000 shares of class A
common stock. Price—The certificates will be offered in
various denominations at 100% per certificate, and the
class A common stock at $2 per share. Proceeds—For
<6%
owning, buying and selling, and other¬
wise dealing in real estate, or matters pertaining to real
estate and the improvement thereof, in the areas in
Which the company will operate. Office—Aiken, S. C.
the purpose of
^Underwriter—None.
Jacksonville Capri Associates Ltd.,
Fla.
Jacksonville,
filed
Julv 23
$325,000 of limited
partnership interests.
|?rice—$5,000 per unit. Proceeds—For the purpose of
acquiring and operating the Capri Motel in Jacksonville,
Underwriter—None.
jria.
New Orleans, La.
Julv 28 (letter of notification) 15,000 shares of common
ctock (par two cents) to be offered for subscription by
common
stockholders of record Aug. 15, 1958 on the
Kalvar Corp.,
4basis of
new
one
share for each five shares held; rights
Aug. 25, 1958. Price—$20 per share. Pro¬
invest in fixed assets and
working capital. Office—909 South Broad St., New
Orleans 25, La. Underwriter—Howard, Weil, Labouisse,
^riedrichs & Co., New Orleans, La.
ital.
Keystone Custodian Funds, Inc.
(by amendment)
1,250,000 shares of Key-
Stone tax Exempt Bond Fund. Price — $20 per share,
proceeds — For investment.
Underwriter — Lehman
Offering—Temporarily postponed.
legislation.
necessary
filed
18
of first mortgage bonds due
2.988.
Proceeds—To refund 4%% first mortgage bonds
«lue 1982. Underwriter—To be determined by competi¬
tive
$10,000,000
bidding.
Probable bidders: Halsey, Stuart & Co.
Inc.: The First Boston Corp.; Blyth & Co., Inc.; Lehman
Brothers, Merrill Lynch, Pierce, Fenner & Smith and
Reinholdi & Gardner (jointly); Eastman Dillon, Union
Becurities & Co.; Stone & Webster Securities Corp. Bids
—Had been expected to be received up to 11 a.m. (EDT)
on July 8, but offering has been postponed indefinitely
Leader-Cleveland Realty Associates, N. Y.
July 16 filed $1,280,000 of participations in partnership
Interests.
Price—$10,000 per participation. Proceeds—
•Po purchase the Leader Building in Cleveland, Ohio.
TUnderwriter—None.
Life
Securities Corp.
Insurance
River Fuel Corp.
Aug. .15 filed 337,052 shares of common stock (par $10)
pursuant to the company's Restricted Stock
Option Plan to certain officers and key employees of
the company and its subsidiaries.
Power
Montana
Co.
(8/26)
July 1 filed $20,000,000 of first mortgage bonds due 1988.
Proceeds — Together with other funds, to be used to
repay $15,500,000 in bank loans and to carry on the
company's construction program through 1959. Under¬
writer—To be determined by competitive bidding. Prob¬
able bidders: Halsey, Stuart & Co. Inc.; Lehman Bros.;
Merrill Lynch, Pierce, Fenner & Smith, and Stone &
Webster Securities Corp. (jointly); White, Weld & Co.;
Eastman Dillon, Union Securities & Co.; Kidder Peabody & Co., Smith, Barney & Co. and Blyth & Co., Inc.
(jointly). Bids—To be received up to noon (EDT) on
Aug. 26 at Room 2033, Two Rector St., New York, N. Y.
will
stock
offered
be
common
only
to
stock
bona
fide
(no
par).
residents
Price—To be related to the current market
on the New York Stock Exchange.
Proceeds—To¬
gether with other funds, to carry on the company's con¬
struction
program
through 1959.
Manager-Dealers —
Smith, Barney & Co., Kidder, Peabody & Co# and Blyth
price
&
Co., Inc.
Mortgages, Inc.
July 28 (letter of notification)- 296,750 shares of
mon
stock (par 25 cents).
Price—$1 per share.
ceeds—To
invested
be
in
notes
secured
by
com¬
Pro¬
first
and
properties to be selected by the man¬
of the company. Office;—223A Independence
Building, Colorado Springs, Colo. Underwriter—Copley
agement
& Co., Colorado
Springs, Colo.
For purchase of land, construction and'working capital.
Underwriter—Southeastern Securities Corp., New York.
Picture
Investors
Inc.
July 11 filed 200,000 shares of common stock (par $1).
Price—$10.75 per share. Proceeds—For investment. Of¬
fice—1000 Power & Light Bldg., Kansas City, Mo. Un¬
derwriter—None.
Municipal
Investment Trust Fund,
Inc. (N. Y.)
May 9, 1957 filed 5,000 units of undivided interests in
Municipal Investment Trust Fund, Series A. Price—At
market. Proceeds—For investment.
& Co., New York.
chase hotel.
common
Underwriter—Tenney Associates, Inc., New
York.
Magna Investment & Development Corp.
May 26 filed 56,000 shares of common stock and $500,000
of 6% convertible debentures. Price—For debentures, at
t>ar (in $1,000 units); and for common stock, $4.50 per
dhare.
Proceeds—For contractual obligations, for work¬
ing capital, and other general corporate purposes. Busi¬
ness — To engage primarily in the
development and
stock (par one cent).
Price—10 cents
share. Proceeds—For mining expenses. Underwriter
—Birkenmayer & Co., Denver, Colo.
per
National Educators Finance
June 4
(letter of notification)
50,000 shares of
common
Price—At par (50 cents per share).: Proceeds—
and procure persons to implement and carry
the projected plan of development and operation.
train
out
Western
National
June
Pearl
Securities
25
St.,
298,000
shares
offered in exchange for
outstanding shares of
caustic
Boulder,
Colo.
Underwriter—
Co., Boulder, Colo.
Gypsum Co.
filed
of
common
stock
to
be
^11 but not less than 90% of the
common
stock
of
American
En¬
Tiling
Co. Inc., in the ratio of one share of
National Gypsum common for each 2-4/10ths of Amer¬
ican
Encaustic
common.
National
Gypsum shall have
the right, at its election, to accept less than 90% but in
event less than 81%
no
mon.
of the American Encaustic
com¬
Statement effective July 17.
operation of various properties, including shopping cen¬
ters. Office—Salt Lake City, Utah. Underwriter—J. A.
★ National Steel Corp.
Aug. 15 filed 93,000 shares of capital stock (par $10) to
Hogle & Co.. Salt Lake City. Utah. Offering—Expected
in. latter part of August or early in September.
be offered pursuant to the
Plan for Salaried
Mairs & Power Fund,
Aug
Inc., St. Paul, Minn.
40,000 shares of common stock. Price—At
6 filed
market.
Proceeds—For investment.
Office—1002
National Bank Bldg., St. Paul, Minn.
Martin
Co., Baltimore,
First
July 1, 1978.
Proceeds
Md.
debentures, due
Working capital and general
—
Price—To
be
supplied by amend¬
ment.
Underwriter—Smith, Barney & Co., N. Y. Offer¬
ing, which was expected on July 2, has been
postponed.
Issue to remain in registration.
Mayfair Markets
March
24
(letter
cumulative
of
5,000
shares
Mid-West Durex Co., Kansas
City, Mo.
July 14 filed 725,000 shares of common stock
per
of
6%
(par $1).
share. Proceeds—For construction of plant
Sales
Milgo Electronic Corp.
Aug. 6 (letter of notification) 10.000 shares of common
stock (par $1) to be offered for subscription
by present
owned
of
on
the basis of
record
of record
Underwriter—T. J. Campbell Investment Co., Inc.,
intended to be redeemed on Nov.
1, 1958. Under¬
writer—To be determined
by competitive bidding. Prob¬
able bidders:
Halsey, Stuart & Co. Inc.: The First Boston
date.
one
share for each 8.8 share-?
Rights
expire
in
Corp.; Morgan Stanley & Co.
September.
Bids—Were to have been
received at Room
20
to 11
a.m.
decided to
2315, 195 Broadway, New York, N. Y..
(EDT) on Aug. 26, but company on Aug.
postpone refunding program.
Carolina
Md.
'
•
March 24,
Calvert
& Co.,
1958 at the rate of IV4 new shares
Employees may purchase 50,-
000 shares of unsubscribed stock. Priee—To
$1.75
stockholders,
share; and to public, $2 per share. Proceeds—
For mining, development and exploration costs, and for
working capital and other corporate purposes. Under¬
per
both of Salt Lake
Co., and Whitney & Co.,
City, Utah.
Oil & Mineral Operations, Inc., Tulsa, Okla.
April 14 filed 200,000 shares of common stock. Price—
$2.50 per share. Proceeds—For payment of loans, various
—To acquire and operate mining claims and oil and gas
equipment, and a reserve for future operations. Business
properties. Underwriter—Universal Securities Co., En¬
terprise Building, Tulsa, Okla.
• One-Hour
Valet, Inc., Miami, Fla* (8 27)
July 29 filed 102,566 shares of common stock (par $1).
Price
To be supplied by amendment.
Proceeds—To
selling stockholders. Underwriter—R. S. Dickson & Co.,
—
Inc., Charlotte, N. C.
jr Pacific
/
;
Automation
Calif.
\
-
Products
Inc.,
Glendale,
(9/15)
19 filed
125,000
shares of capital stock
(par $1).
Price—To be supplied by amendment. Proceeds—To re¬
tire bank loans and for working capital. Underwriter-
William R. Staats & Co., Los
Paradox
Angeles, Calif.
Production
Corp., Salt Lake City, Utah
April 18 filed 767,818 shares of common stock (par $1),
of which 100,000 shares are to be offered by the
company
in exchange for oil and gas properties and 3,000 for serv¬
ices; the remaining 664,818 shares are to be offered to
public. Price—To be supplied by amendment. Pro¬
the
ceeds—To selling stockholders.
Underwriter—Market
Securities, Inc., Salt Lake City, Utah. Statement effec¬
tive Ji,r>e 5.
-
Peckman Plan Fund,
Inc., Pasadena, Calif.
May 19 filed 20,000 shares of common stock (par $1).
market.
Proceeds—For
investment.
writer—Investors Investments Corp.,
Under¬
Pasadena, Calif.
Peerless
Weighing; & Vending Machine Corp.
of notification) a maximum of 25,000
shares of common stock (par $1) to be offered to minor¬
June
27
(letter
ity stockholders
on
the basis of
one
new
share for each
Any unsubscribed shares will be pur¬
by Rock-Ola Mfg. Corp. Warrants expire 20 days
from date of issuance. Price—$4.25 per share. Proceeds
—For working capital. Office—800 N. Kedzie Ave., Chi¬
cago 51, 111. Underwriter—None.
chased
Pennsylvania Power Co. (8/27)
Aug. 1 filed $8,000,000 of first mortgage bonds due 1988.
Proceeds—To redeem a like amount of 5% first mort¬
bonds
gage
Natural Gas Corp. (9/4)
July 31 filed $5,200,000 of subordinated income deben¬
tures due Aug.
15, 1983, and 520,000 shares of common
stock (par $2.50) to be offered
in units of $20 of deben¬
tures and two shares of stock.
Price—To be supplied by
amendment (a maximum of
$33 per unit).
Proceeds —
Together with funds from private placement of
$13,750,000 of 5%% first mortgage pipeline bonds due June
1, 1979, to be used for construction
program and working
capital. Office—Fayetteville, N. C. Underwriter—Kid¬
der, Peabody & Co., New York.
due
1987.
Underwriter—To
be determined
by competitive bidding. Probable bidders: Halsey, Stuart
& Co. Inc.; Kidder, Peabody & Co.; White Weld & Co.;
Equitable Securities Corp., and Shields & Co. (jointly);
Lehman
Brothers, Eastman Dillon, Union Securities &
Co., Salomon Bros. & Hutzler and Ladenburg, Thalmarin
& Co.
(jointly); Merrill Lynch, Pierce, Fenner & Smith
Witter & Co. (jointly).
Bids — Tentatively
expected to be received up to 11 a.m. (EDT) on Aug. 27.
and
Dean
Phoenix Carousel Theatre
Aug.
11
(letter of notification)
debentures
(in
stock
debenture
and
Proceeds
Broadway
*
multiples
(par
one
—
musical
Phoenix, Ariz.
$190,000 of 10-year 6%
si00)
plus 950 shares of
to be offered in units of one
share
of
To
of
build
shows.
$200)
Price—$300
common.
a
theatre
and
Address—P.
O.
per
to
produce
Box 10245,
Underwriter—None.
Policy Advancing Corp.
(letter of notification) 30,250 shares of com¬
stock (par $5) to be offered for subscription by
March 25
mon
common
each
New
England Telephone & Telegraph Co.
July 31 tiled $40,000,000 of 34-year debentures due Sept.
1, 1992. Proceeds — To refund a like amount of 4^2 %
first mortgage
bonds, series B, due May 1, 1961, which
up
Office—2502 N.
Underwriter—Burnett
expenses.
18,
for each share then held.
unit.
Houston, Tex.
North
and for working capital.
Underwriter—Investment
Inc., 532 E. Alameda Ave., Denver 9, Colo.
stockholders
of
May 5 (letter of notification) 150,000 shares of common
Price—$2 per share. Proceeds—To
pay loan; to acquire fishing tools for leasing; and for
working capital. Office—931 San Jacinto Bldg., Houston,
•
operating
Inc., Salt Lake City, Utah
April 4 filed 597,640 shares of common stock (par $1)
to be offered for subscription by common stockholders
common
employees
Nedow Oil Tool Co.
Tex.
and
Oil
stockholders at the rate of
new
one
share for
share
held; unsubscribed shares to be offered to
and to others.
Price—$8 per share.
Proceeds—For working capital.
Office—27 Chenango
St., Binghamton, N. Y. Underwriter—None.
debenture
Ponce
are
notification)
preferred stock
(par $50) and 5,000 shares
Of common stock (par $1) to be
offered in units of one
chare of preferred and one share of common
stock. Price
—$60 per unit. Proceeds—For
working capital. Office—
1383 Bandini Blvd., Los
Angeles, Calif. Underwriter—
None.
Price—$2
to eligible
and' its subsidiaries.
stock (par one cent).
June 11 filed $25,000,000 of sinking fund
corporate purposes.
company's Stock Investment
Employees
the coir-aany
tion
four shares held.
Corp.
stock.
To
23,200 shares of com¬
stock (par $1). Price—$5 per share. Pro¬
completion of plant plans; land; construc¬
St., Baltimore
Sparks, Md.
Price—At
Beryl & Mining Corp., Estes Park, Colo.
May 16 (letter of notification) 2,916,000 shares of non¬
Office—1406
Corp., N. Y. C.
July 29 filed $1,655,000 limited partnership interests in
this company. Price—$5,000 per unit. Proceeds—To pur¬
Sponsor—Ira Haupt
National
assessable
Enterprises Inc.
(letter of notification)
6
class B
mon
Aug.
Motel Co. of Roanoke, Inc., Roanoke, Va.
Nov. 18,1957 (letter of notification) 60,000 shares of com¬
mon stock (par 40 cents). Price—$5
per share. Proceeds—
Motion
O. T. C.
March
writers—Harrison S. Brothers &
Montana Power Co.
July 1 filed 100,000 shares of
Brice—$5 per share. Proceeds—To acquire stock control
of "young, aggressive and expanding life and other in¬
surance companies and related
companies and then to
operate such companies as subsidiaries." UnderwriterFirst Maine Corp., Portland. Me.
Lord Elgin Hotel
share for each six shares held. Price—At par ($1
share).- Proceeds—To pay off obligations and fear
telephone plant construction. Underwriter—None.
one
ceeds—For
March 28 filed 1,000,000 shares of capital stock (par $1).
Longren Aircraft Co., Inc.
June 18 (letter of notification) 34,000 shares of common
stock (par $1). Price—From 80 cents to $1.40 per share.
Proceeds—To go to selling stockholders.
Office—24751
Crenshaw Blvd., Torrance, Calif.
Underwriter—Daniel
Reeves & Co., Beverly Hills, Calif.
North Carolina Telephone Co.
June 19 (letter of notification) 207,143 shares of common
stock to be offered to common stockholders at the ratio
to be offered
second liens upon
Laclede Gas Co.
June
general
per
The
Brothers, New York.
to
of
of Montana.
•C*ending passing of
$26
* Mississippi
ceeds—To retire bank loans, to
#or
•
stockholders;
to
derwriter—None.
Co expire on
Aug. ,7 filed
share
per
Proceeds—For test equipment and working cap¬
Office—7601 N. W. 37th Avenue, Miami, Fla. Un¬
public.
Thursday, August 21, 1958
..
.
Aug.
holders
de Leon
Trotting Association, Inc.
7 filed 400,000 shares of
common
stock
(par one
cent).
Price—$1.50 per share, Proceeds—To pay current
liabilities, for new construction and working capital.
Office—Bayard, Fla.
Underwriter—Robert L. Ferman
Co., Inc., Miami, Fla.
Potomac Plastic Co.
March 31
(letter of notification) $57,500 of 6% subordi¬
nated convertible debentures and 57,500 shares of class A
common stock
(par one cent) to be offered in units of
500 shares of stock and $500 of debentures.
per
ital
unit.
Proceeds
—
Price—$1,000
For equipment and working cap¬
Office—1550 Rockville
Pike, Rockville, Md. Under¬
writer—Whitney & Co., Inc.. Washington, D. C.
•
Prairie Fibreboard Ltd.
Aug. 18 filed 209,993 shares of
common
stock (par $1.50)
be offered for sale to residents of Canada in the Provw
inces of Manitoba. Saskatchewan and Alberta and to
to
Volume 188
Number 5770
.
.
Securities
residents of the United States "only in the State of North
Union
Dakota."
Lehman
share. Proceeds — For con¬
purpose.
Office—Saskatoon, Saskatchewan,
Canada. Underwriter—Allied Securities Ltd., and United
Priced—$3
per
struction
Securities, Ltd., both of Saskatoon, Canada.
Private Enterprise, Inc., Wichita, Kansas
May 5 filed 125,000 shares of common stock. Price—$10
per share.
Proceeds — To be used to organize, or re¬
organize and then operate companies in foreign nations,
principally, but not exclusively, in the Far East, Near
East and Africa.
Underwriter—None.
-
.
*
^ Provident Security Life Insurance Co.,
Phoenix, Ariz.
Aug. 12 (letter of notification) 93,259 shares of common
capital stock (par $1); Price—$2 per share. Proceeds—
For expenses incidental to operation of an insurance
company.. Underwriter—None.
•
,
,
.
.
..
Rapid-American Corp., New York
June 19 filed $1,504,000 of 7% sinking fund debentures,
due Nov. 15, 1967, together with 105,000' shares of com¬
mon stock (par $1);' Proceeds—The debentures are al¬
ready outstanding having been issued in payment of
47,000 shares of common stock of Butler Brothers which
were acquired by Rapid American from 19 persons, in¬
cluding three directors of the corporation. The deben¬
tures are being registered against the possibility that
they may be sold by present owners. Of the 105,000
common shares, 75,000 are issuable under the company's
Restricted Stock Option Plan for officers and key em¬
ployees, and 30,060 under the Employees' Stock Pur¬
chase Plan.
Underwriter—None.
Rassco Financial Corp.
•
(737)
The Commercial and Financial Chronicle
.
(9/15-19)
June 26 filed $1,000,000
of 15-year 6% series A sinking
be offered in denominations
of $500 and $1,000. Price—At par. Proceeds—For work¬
ing capital and general corporate purposes. Underwriter
—Rassco Israel Corp., New York, on a "best efforts"
fund debentures due 1973, to
&
Brothers
ceived up to
Co.;
$60 per unit.
First Boston Corp., and
Bids—Expected to be re¬
The
(jointly).
Richwell
Petroleum
Alberta,
Ltd.,
Canada
June 26 filed 1,998,716 Shares of common stock (par $1).
Of this stock, 1,174,716 shares are to be sold on behalf of
the company and 824,000 shares for the account of cer¬
11 a.m. (EDT) on Sept. 10.
March 25 (letter
Proceeds
couver,
Canada.
;
Riddle Airlines, Inc., Miami, Fla.
"best efforts" basis.
Robosonic
National
/
-
Industries
Corp.,
N. Y.
class B.
Price—$3 per share. Proceeds—To manufacture on a
contract basis an automatic telephone answering instru¬
ment; the enlargement of the research and development
facilities of the company; patent and patent applications;
public relations, and for working capital. Underwriter—
June 12 filed 500,000 shares of common stock,
"
None.
.
V
•,.t
/
.
share.
(8/25)
series K, due 1983., Proceeds
bonds,
construction
for
and
loans
determined
be
—
program.
Probable
Corp., and Dean Witter & Co.
Boston
(jointly); Blyth
Trans-Eastern'Petroleum Inc.;' 77:/ -.7 )■ : •> t(letter of notification) 7,500 shares of comment,
stock (par $1) to be offered pro-rata to stockholders o».
Oil Co. of California
Feb. 27
of sinking fund debentures diw
the basis of
—$4
provide additional capital for the company*!
overall program.
Underwriters—Blyth & Co., Inc., and
Dean Witter & Co., both of San Francisco, Calif., and
New York, N. Y. - Offering—Postponed from June 25 by
the company "due to market conditions."
Issue to re-T
this year to
jersey)
other
capital stock at rate of five Standard Oil shares for
Oil shares. The offer is expected to
until Oct. 14, 1958. Exchange Agent—Mor¬
Stanley & Co., New York.
July 9
ment
(letter of notification) 50,000 shares of common
(par $1). Price—$5 per share. Proceeds—To be
and bonds and to acquire other life
Address—P. O. Box 678, Gulfport,
Miss. Underwriter—Gates, Carter & Co., Gulfport, Miss.
Imperial Corp., San Diego, Calif.
June 2 filed 70,000 shares of 5J/2% cumulative convert¬
ible preferred stock.
Price — At par ($10 per share)
Proceeds—To retire $550,000 of promissory notes. Under¬
writer—J. A. Hogle & Co., Salt Lake City, Utah. Offer¬
ing—Postponed indefinitely.
of sinking fund
debentures
Proceeds—To add $50,000,000 to the capital of
Dunn
Strategic Minerals Corp. of America, Dallas, Tex
March 31 filed $2,000,000 of first lien mortgage 6% bondi
975,000 shares of common stock (par 10 cents). Prlc#
95% of princmal amount; and for stock $2
per share. Proceeds—To erect and operate one or mow
chemical processing plants using the Bruce - William!
—For bonds,
Process
to
Underwriter-
beneficiate manganese ores.
Southwest Shares,
Inc.. Austin, Texas.
Expected in September.
(9/10)
12 filed $10,000,000 first and refunding mortgage
bonds due 1988.
Proceeds—To repay bank loans and for
construction program.
Underwriter—To be determined
Probable bidders: Halsey, Stuart
Peabody & Co.; Eastman Dillon,
by competitive bidding.
&
Gas Co.
Co.
Inc.:
Kidder,
77
President.
V Y:
.
.
/ I
,
'
operate recreation area.
Statement effective Aug. 8.
None.
Tax
: ':
-
' '*
i
■■
Under-
City, Mo.
June 20 filed $10,000,000 of plans
,
of shares of
market.
Stowers
Plan, Kansas City,
Underwriter
for the accumulation
Twentieth Century Investors, Inc. Price—At
—
For investment.
Underwriter—
Proceeds
& Co., Kansas
City, Mo.
'
Montreal, Canada
July 29 filed 225,000 shares of capital stock (par $1) to
be issued upon exercise of options exercisable at $4 per
share.
Proceeds—To pay outstanding liabilities, to in¬
crease working capital and for general
corporate pur¬
poses. Underwriter—None.
United Asbestos Corp., Ltd.,
United Employees Insurance Co.
.
April 16 filed 2,000,000 shares of common stock (par $5>.
Price — $10 per share. Proceeds — For acquisition oft
operating properties, real and/or personal, including*
office furniture, fixtures, equipment and office space, by
lease or purchase. Office — Wilmington, Del. Under¬
writer—None.
Myrl L. McKee of Portland, Ore., Is
President.
—
it U. S. Land Development Corp., Fort
Lauderdale,
Fla.
Aug. 15 filed 1,200,000 shares of common stock (par $1).
Price—To be supplied by amendment. Proceeds—To ber
added to the company's general funds and used to de¬
Pineda Island near Mobile, Ala.
Palm Beach Investment Co., Inc., Palm
velop
Corp., Nashville, Tenn. Offering—Held
pending passing of necessary legislation by Congress.
Securities
Co., Abilene, Texas
April 30 filed 2,000,000 shares of capital stock (par 25
cents). Price—To be supplied by amendment. Proceeds
—To selling stockholder.
Underwriter—Thomson Kernaghan & Co., Ltd., Toronto, Canada. To be offered in
Canada only.
UnderwriterBeach, Fla.
United States Sulphur Corp. F
shares of common stock (par one
cent). Price—$1 per share. Proceeds—For plant rental
etc.; to retire corporate notes; for core drilling; fc*
working capital; and for other exploration and develop
ment work
Office — Houston. Texas.
Underwriter —
None.
Statement effective June 23.
Oct. 8 filed 1,500,000
Texas Calgary
1
United States Telemail Service, Inc.
Thomas Paint Products Co.
May 26 (letter of notification) 1,250 shares of common
stock (par $10) and $37,500 of 6% serial subordinated
debentures series 1958, to be offered in units of one
share of stock and $50 principal amount of debenture!
to be offered to stockholders on the basis of one unit for
stock owned
.
Mo.
Exempt Bond Fund, Inc., Washington, D. C.
two shares of
'•»<-/
investment.
Twentieth Century Investors
20, 1957 filed 40,000 shares of common stock (public
offering of 500,000 shares now planned). Price—$25 per
share. Proceeds—For investment.
Underwriter—Equit¬
each
market.. Proceeds—For
writer—Stowers & Co., Kansas
•<
June
up
v
shares of common stock (par $1)..
June 20 filed 2 000,000
Sugarbush Valley Corp., Warren, Vt.
June 25 filed $392,800 of 20-year 6% subordinate income
debentures due May 1, 1978, and 12,766 shares of com¬
mon stock
(par $1) to be offered in units consisting of
$800 principal amount of debentures and 26 shares
of stock.
Price—$1,200 per unit. Proceeds—For pay¬
ment of short-term bank
loan and working capital.
To
Inc., Kansas City,,
Investors,
MO.
—
Price—At
•
—
/
Prattr-
'
purchase of fixed assets of Redi-Gas Co.; the bal¬
if any, will be added to working capital to be
available for general corporate purposes.
Underwriter
Business
-
■
Underwriter—H. A. Riecke & Co., Inc.,
.
7,
'
/ ties Bid g., Seattle 1, Wash.
Underwriter—H. P.
& Co., 807 Hoge Bldg., Seattle 4, Wash.
„*
-•
Philadelphia, Pa.
7
,
'
Twentieth Century
Strouse, Inc.
July 29 (letter of notification) 26,850 shares of common
stock (par 10 cents) to be issued upon exercise of war¬
rants.
Price—$1 per share. Office—Main & Astor Sts.,
able
it Simplicity Pattern Co. Inc., N. Y.
Aug. 15 filed 42,500 shares of common stock (par $1).
Price—At the market or at a price within a range not
less than the bid price and not higher than the asking
price quoted on the New York Stock Exchange at the
time of offering. The shares will also be offered from
time to time on such Exchange at a price within the
foregoing range. Proceeds—To go to Joseph M. Shapiro,
the selling stockholder. Underwriter—None.
is
Tungsten Mountain Mining Co.
Aug. 11 (letter of notification) 100,000 shares of corn¬
s' mon stock (par $1). Price—$1.50 per share. Proceeds—
To extinguish present indebtedness, increase reserve for
contingencies and working capital. Office—511 Securi—
and
its subsidiary;
to retire bank
loans or for working capital for expansion.
Under¬
writers—Goldman, Sachs & Co., Halsey, Stuart & Co.
Inc. and Lehman Brothers, all of New York. Offering—
Aug.
,
Newark, N. J.
Aug. 1 filed $1,600,000 of 5% debentures due 1973, 4,000
shares of 6% preferred stock
(par $100) and 48,00®
shares of common stock (par $1) to be offered in unit*
—Kidder, Peabody & Co., New York.
San Diego
Electric &
instalment purchase contract for land and im¬
• Stevens Markets Inc., Miami, Fla. (9/10-11)
Aug. 14 filed 46,642 shares of cumulative preferred
of $8,000 of debentures, 20 shares of preferred stock and
stock (par $25). Price—To be supplied by amendment.
240 shares of common stock.
Price—$10,240 per unit,
Business—Operates three large supermarkets.. Proceeds
—For expansion, working capital and other corporate ; Proceeds—To acquire, own and operate interests in pro¬
ducing oil and gas properties. Underwriter—None. Of¬
purposes. Underwriter—R. S. Dickson & Co., Charlotte,
fice—11 Commerce Street, Newark, N. J.
Timothy H.
n. c.
' '
*
derwriter—None.
Carolina
on
Triton Corp.,
ance,
South
.
Price—$1 per share. Proceeds—For research pro¬
exploration, and it is hoped, recovery of buried
exploitation of lost mines and
mineral deposits.
Underwriter—None.
Co., New York, N. Y.
invested in stocks
the
Co.,
D. C.
provements; for construction of plant, tools and equip¬
ment; advertising and working capital.
Office — 54®'
Steamboat Rd., Greenwich, Conn. Underwriter—Sano &
Life, Health & Accident Insurance Co.
Corp., Salinas, Calif., on
St. Regis share for 18 shares of stock of
Growers Container. The offer expires on Aug. 30. Un¬
one
Insurance
•
it Tricon, Inc.
Aug. 8 (letter of notification) 150,000 shares of common,
stock (par $1). Price—$2 per share. Proceeds—To payr
expenses and cost of plant option; for first year's pay¬
remain open
State
Prie*
and sunken treasure and
being offered in exchange for Humble Oil & Refining
gan
share for 10 shares owned.
Proceeds—For drilling for oil and gasu
Street, Coudersport, Pa. Under¬
''
! / r-* C* *' / .
Main
Aug. 14 filed 1,946,499 shares of common stock (par one
July 31 filed 11,406,078 shares of capital stock (par $7)
Co.
N.
* Treasure Hunters, Inc., Washington,
cent).
(New
new
one
share.
writer—None.
gram,
Co.
tal stock of Growers Container
State
per
Office—203
main in registration/
Standard Oil
1
Uranium Mining, Corp.
one
July 1, 1983. Price—To be supplied by amendment. Proceeds—To refinance a bank obligation of $50,000,000 due
•
to be publicly offered. Price—$5 pep
new wells and for general
shares of common stock (par
mill). Price—25 cents per share. Proceeds—For lanft
acquisition, exploratory work, working capital, reserve^
and other corporate purposes. Underwriter^-Norie. Al¬
fred E. Owens!df/Waterloo. Ia„.tis President,
77V7
bid¬
Co., Inc. - Bids—Expected to be received up to 9 a.m.
(PDT) bri Aug.'25 at .company office. \
Standard
are
.
&
June 4 filed $150,000,000
.
Nov. 6, 1957 filed 3,000,000;
Halsey, Stuart & Co. Inc.; Kuhn, Loeb & Co.; First
ders:
the basis of
due 1983.
E. Main
111
Proceeds—To drill two
Trans-America
Underwriter—To
competitive bidding.
by
To retire bank
Regis Paper Co., New York
l
July 8 filed 118,746 shares of common stock (par $5)
being offered in exchange for outstanding shares of capi¬
St.
All
—
corporate purposes. v;Underwriler — AndersehrRahdolpl*
& Co., Inc., Salt/Uke!City,
UtalL::;777 77/ ;
<
Aug. 4 filed $50,000,000 of first and refunding mortgage
.
outstanding indebtedness. Office—Littleton,
Colo.
Underwriter—R. B. Ford Co., Windover Road,
Memphis, TEim.
repay
^ Sears Roebuck & Co.
Aug. 20 filed $350,000,000
Office
200,000 shares
Southern California Edison Co.
it Suburban Gas Service Inc., Upland, Calif.
(9/16)
r"'
Aug. 18 filed 100,000 shares of common stock (par $1),
of which 50,000 shares are to be offered by the company
and 50,000 shares by selling stockholders. Price—To be
supplied by amendment. Proceeds—Together with other
funds, for retirement of bank loan and of obligations
incurred in connection with minor acquisitions and for
—To
capital.
U nder writer—N one.
Norristown, Pa.
Rocky Mountain Quarter Racing Association
/
Oct. 31, 1957 (letter of notification) 300,000 shares of
common stock.
Price—At par ($1 per share). Proceeds
}
For working
■
May 15 filed 750,000 shares of common stock (par 10
cents). Price—To be supplied by amendment. Proceeds
—For working capital/ Underwriter—James H. Price &
Co., Inc., of Coral Gables, Fla., for 250,000 shares; balance
on
—
Tip Top Oil & Gas Co., Salt Lake City, Utah
April 15 filed 220,000 shares of common stock, of whids
insurance companies.
(with an oversubscription privilege). The subscription
period will be for 30 days following issuance of sub¬
scription rights. Price—To be supplied by amendment.
Proceeds—To pay off demand note, to pay other indebt¬
edness, and the balance if any will be added to working
capital. Underwriter —Pacific Securities Ltd., Van¬
.
St., Morristown, Tenn. Underwriter—Valley Securitiee
Corp., Morristown, Tenn.
per
at the rate of
share for each three shares held
7
' 7j
of notification) 27,272 shares of 70-centi"
cumulative preferred stock (par $5) and 27,272 share*,
of common stock (par 10 cents) to be offered in unit*
of one share to each class of stock. Price—$11 per unit.
share. Proceeds—To expand the operations of
the company and to meet the statutory requirements to
enter other States and eventually to add other lines of
insurance. Office—197 Auburn Ave., N. E., Atlanta, Ga.
$26
stock
new
'
Timeplan Finance Corp.
it Southeastern Fidelity Fire. Insurance Co.
Aug. 12 (letter of notification) 8,981 shares of common
stock (par $10), of which 2,000 shares are to be offered
to stockholders (rights to expire on Sept. 1), and 6,981
shares to the public
(plus any unsubscribed shares).
Price—To stockholders, $20 per share; to the public,
tain selling stockholders. The company proposes to offer
the 1,174,716 shares for subscription by its shareholders
one
Proceeds—For working capital. Offic
St., S. W., Atlanta, Ga. Underwriter—
None.
each four Humble
basis.
Whitehall
543
37
(500 of the shares are
being offered to the President of the company).
Price—
$1).
purchase equipment
and supplies and for working capital and other corporal*
purposes.
Office—Salt Lake City, Utah. Underwrite*—
Feb.
17 filed 375,000 shares
of common stock (par
Price—$4 per share. Proceeds—To
Amos Treat &
Co., Inc., of New York.
1
Continued
on
page
33
38
v
(738)
The Commercial and Financial Chronicle
Continued
from
page
to
37
be offered holders of
outstanding 5% subordinated
debentures of record March 24 at rate of five shares foi
each $1,000 of debentures then held.
Price
$60 pei
share.
Proceeds—For working capital.
Underwriter—
,
•
Universal-Cyclops Steel Corp.
Aug. 5 filed $22,500,000 of sinking fund debentures due
Sept. 1, 1978.
Price—To be supplied by amendment.
Proceeds—To repay $10,300,000 of bank loans and for
construction program. Underwriter—A. G. Becker & Co.,
Inc., Chicago, 111., and New York, N. Y. Offering —
Ore.,
is
Yonkers, N. Y. Underwriter
Broadway, New York 6, N. Y.
•
•
'
•,
,
•
■
•
i
,*.
•
i
>
••
,
<r.
•
April 11
(letter of notification) 900,000 shares of com¬
Price—At par (10 cents per share). Proceeds
—JFor mining expenses. Office—305 Main St., Park
City,
Utah.
Underwriter—Walter Sondrup & Co.,
Ave., Rochester 11, N. Y. Underwriter—Frank
8t GO., Jhc., Rochester, N. Y.
Acme
e
con¬
».■
it Western Associated Mining News Inc.
Aug; 11 (detter of notification) 18,354 shares of
com¬
Proceeds—
Tqj repay loan, for business
expansion, working capital,
etc;. Office—2230 Commercial
St., N. E.,
Salem,
outstanding
of¬
com¬
share for each three
shares held. The record date is to be
supplied by amend¬
ment.
Price—At. par ($5 per
share). Proceeds—To be
applied to the payment of $700,000 of short-term bank
leans incurred in carrying forward the
one
new
struction and conversion program.
company's
con¬
Underwriter—None
it Western Development Co. of Delaware
(9/11)
Aug. 15 filed $3,500,000 of convertible debentures due
1970. Price—To be
supplied by amendment. Proceeds—
To refund all
existing term and current debt of the
company,, and the balance will be added to the
general
funds of the company and will be
made available for
the* development of its
present properties and the ac¬
quisition and development of additional oil
and
properties.
Underwriter—W.
C.
York.
Langley
&
Co.,
gas
New
^Western Heritage Life Insurance Co.
Aug; 8> (letter of notification) 150,000 shares of
common
capital stock (par 50 pents). Price—$2 per share. Pro¬
ceeds—For expense incidental to
operating an insurance
company.
Office—533 East McDowell
Rd., Phoenix,
Ariz.
Underwriter—First American Investment
Corp.
J
Western Industrial Shares, Inc., Denver, Colo.
July 16 filed 1,000,000 shares
of
common stock
(par 25
Proceeds—For investment
Randolph & Co., Inc., 65 So
cents). Price—$5 per share.
Underwriter
Andersen,
—
Main St., Salt Lake
City, Utah.
Western Pacific Mining
Co., Inc.
May 26 filed 564,000 shares of common
Austria
par
($1
per
share).
Price—At
Proceeds—For capital expenditures
Office—Santa Paula, Calif.
Un-
vote
<
one new
of
share
the
share for each four shares held and
for the balance of such
number of
new
one
holdings to "
shares divisible by
four; also
of
4J/2%
bonds,
improvements
new
pany
will follow.
notes
7
repay
held
ficate
of
shares
March 28 it
/
authorizing
,
stockholder^ approved a plan
connecilqn with an offering of
common
'
,
*
.
the
stock f
: •' "V
'
" ;;'• :-v"
"/;;/•.
Y'y
X
[
Ji
.•
SIS,000,000 of
first preferred
ipsured bonds secured by
mortgages on the new "Santa Rosa"*
and
/
)
"Santa
The
financing will comprise two issues of $9,- I
Underwriters—Merrill Lynch, Pierce, Fen- *
Smith; Paine,'Webber, Jackson>& Curtis; Smith, -Barney & Co.; White, Weld & Co.; and F. Eberstadt & >
Co., all of New York. Offerings—"Santa Rosa" offering '»
expected early in September and "Santa Paula"" offering later in year.
*
on
-
Great Atlantic & Pacific Tea Co.
Feb. 19 it was reported a secondary
Aug. ,28 will
Gulf
June 5
Gulf
New York, handled last
of
Power Co.
loans.,
j
*
early
/
^
announced company
Interstate
OiL
$2,000,000 and
a
common
*
f
ic Indiana & Michigan Electric Co. (11/6)
Aug. 18 it.was>reported that the company plans early
registration of-$20,000.000 first mortgage bonds due 1988.
'
;
loans
for- construction
used
bidding.
be received
to
nip to'11 a.m.r(EST)
Aug. 20 it
and
was
stated that
$50,000,000 of
an
projects.
New
Nov/v6. \
;
/''t-
'
issue of between $30,000,000
bonds/may
the. American. market.-
on
/on
'r-
it Japan, (Empire of)
soon
be publicly offered'
Proceeds—For
public
Underwriter—Probably The First Boston Corp.,.J
V
/'
* " ' "
'
York.
.
•
Kansas Gas & Electric Co.
was
r
works
..
,
Co., Inc.
announced that the company's
financinj
program for the year 1958
anticipates the sale of botfc
debt and equity securities
>
Underwriter—-To< be: determined
by competi-~ '
Probable bidder.- Halsey, Stuart & Co. Inc.; 4
Eastman-Dillon, Union Securities & Co.; The First Bos- ->
ton Corp.; Harriman Ripley & Co. Inc. *
Bids—Expected
tive
*
to
stockholders in
Proceeds—*To jretire,/.bank
v
stock
September. -Proceeds—For working capital,
or
program.*
September.
(formerly known as-/
Go.) intends to obtain a minimum /
maximum of $5,000,000 via an offer- J
shares of
new
August
;
Interstate Co.
it was
.
Electric
'J
offering of common; J
voting stock is expected in near future. Underwriters—
May include: Blyth & Co.,; Inc.; Carl Ml Loeb, Rhoadee
& Co.; Hemphill; Noyes &
Co.; Smith; Barney & Co.; '
and Merrill Lynch.
Pierce, Fenner & Smith,
>
(par $10). Convertible
$2.86 per share. Proceeds—To retire
outstanding notes
a
subsidiary in the amount of $768,000.
Louisiana
*
»
and
ner
of
Central
>
.
government
cumulative
of
;
Utilities Corp.
Smith, New York.
ship
an issue of 200,000
convertible preferred stock
into common stock at the rate
5%
I
program^
Line> Inc., (9/2-5)',,./* p'"VCompany plans to < issue approximately
incorporation authorizing
of
of short-
Grace
company at a special meeting
June 25, approved an
amendment to the certi¬
on
repayment
construction
000,000 each.
& Co.,
bank
for
stockholders; also to offer certain shares on- the same
Omplbyees, including officers, of System comClearing "Agent—Merrfll Lynch, Pierce, Fenner \
&
money with which
Central Hadley Corp.
The shareholders of the
and
determined
terms to
the nature of the securities to
be offered has been
determined. Decision on these two
points will probably
not be reached until
mid-August or
Proceeds—To
Proceeds—For
loans
If
panies.
ing of
Electric
and
by competitive bidding,
bidders may be Halsey, Stuart & Co.
Inc.;,
Lynch) (Pierce,, Fenner & Smith, and White,.
Weld & Co.-(joiptly) ; Blyth &
Co., Inc.; The First BostonCorp.; Lehman Brothers.^
>
r:
April
,
preferred stock financing.
California
i
■
Merrill
to
under
Underwriter—Hallgarten
.
C
directors in
stock, to provide
to complete
way since early this year,
retire bank loans that had
been, made to finance the
improvements, and provide, additional working capital.
plant
,
was
General Public
issues of preferred
$3,325,000 of
:
March 31; G. W.
1
pany
*
Evans, Chairman, announced that complans to sell some bonds originally scheduled for
mid-year, but which sale may now be deferred until
late 1958 or early 1959. Proceeds—About
$8,000,000 for
(probably preferred stock)
aggregating approximately $5,000,000. Both issues
may
be placed
privately.
construction
■
Cincinnati & Suburban Bell
Telephone
Co.
July 7 it
ized
the
program.
Underwriter—To be determined
competitive
bidding:
Probable
bidders:
Halsey,
& Co. Inc.; Kidder, Peabody &
Co., and Merrill
Lynch, Fierce, Fenner & Smith
(jointly); Lehman
was
sale
-
by
'
(10/21)
Stuart
announced that the directors have author¬
of not
exceeding
$25,000,000
debentures
having a maturity of not more than 35
years.
Proceeds
—To repay advances received from
American Telephone
& Telegraph Co. which
owns
29% of the outstanding
common stock of the
company.
Underwriter
To be
determined by competitive
bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; Morgan Stanley &
Co.; Glore,
Forgan & Co. and Eastman Dillon Union
Securities &
Co. (jointly).
Bids—Expected to b«r«*^ived on or about
_
Brothers; Eastman Dillon, Union Securities & Co. and
Stone & Webster Securities
Corp. (jointly); Glore, Forgan & Co., and Goldman Sachs & Co, (jointly).
Kansas
Power
&
\
■
Z
Light Co.
—
•
21.
Consumers
sue
excess
approximately $5,000,000
secure
.,
refinancing program intended to replace
present mortgage debt and preferred stock with a new
derwriter—None.
rate of
Ltd.
a
note and two
*
probable
;
announced that the
about
it
Underwriter-—
granted company permission
(Republic of)
was
upon
Aug. 19 it
Wfestland Oil Co., Minot, N. Dak.
April 17 filed 7,799 shares of capital stock to be offered
tor subscription by stockholders of
record March 24 at
24
term
v
as an
Basic, Inc., Cleveland, O.
Aug. 2 it was announced stockholders
and exploration costs.
additional
SEC
Investment Co.
t
ri
•>
expects later
reported that company plans to issue ;
$11,000,000 of first mortgage bonds later this y«ar. No de¬
cision as yet has been made as to the
procedure the com- i
country contemplates
the issuance and sale of
$30,000,000 bonds. Proceeds—Foi
electric power projects and other
improvements. Under¬
writer—May be Kuhn, Loeb & Co., New York. Offer¬
ing—Expected in October or early November.
Oct.
stock.
March
July 14 it was announced company
contemplates mar¬
keting between $5,000,000 and
$7,000,000 securities to
October, 1958.
Neither the exact date Of the
offering
nor
N. Car.
June16 filed1 89,391 shares of common stock to be
fend for subscription by holders of
the
July 15 it
Ore.
.WAstern Carolina Telephone Co.. Weaverville.
.'.o.
...
company
to repay short-term
loans and for construction program. Underwriter*
Paula."
^Washington Natural
duce bank loans incurred for construction
purposes.
Underwriter—Dean Witter & Co., San Francisco and
New York.
-
13
registered
African
and
was
sell
Power Co.
(9/23)
announced that the
company
$35,000,000
of
first
—
Shields & Co. (jointly); The
Harriman Ripley & Co. Inc.
First
Boston
(jointly).
on
Sept. 23.
Feb.
sell
14
it
was
announced
company plans to issue and
$10,000,000 of first mortgage bonds due 1988. Pro- /
ceeds—For
construction
program.
,
Underwriter—To
be
determined
by competitive bidding. Probable bidders;
Halsey, Stuart & Co. Inc.; The First Boston Corp.; Glore,
Forgan & Co.; Harriman Ripley & Co. Inc.; White, Weld
& Co.; Blyth & Co., Inc.; Equitable Securities
Corp.
.
plans to is¬
mortgage bonds due
1988.
Proceeds
For expansion and
improvement of
service facilities.
Underwriter—To be determined by
competitive bidding. Probable bidders:
Halsey, Stuart &
Co. Inc.; Morgan
Stanley & Co.; White, Weld & Co. and
ceived
.
Proceeds—Together with $7,000,000 :
Gas Service Co.
Co.
American-South
-
—May be The First Boston Corp.; Kidder, Peabody &
Co.; MerrilLLynch, Pierce, Fenner & Smith: and White,,
Weld & Co., all of New York.
//; ;
;.»v./ •./••_. / ,
Co.,
York.
—
Gas Co. (9/10)
\
Aug. 18 filed 100,000 shares of common stock (par $10).
Price—To be supplied by amendment. Proceeds—To re¬
private sale
bank
of companies engaged in business in
South Africa, with
particular emphasis on those engaged in
mining gold.
The trust may also invest -to a certain
extent in gold
bullion.
Underwriter—Dillon, Read & Co. Inc., New
Aug. 15 (letter of notification) 3,000 shares of common
(par $5). Price — $10 per share. Proceeds
For
working capital and general corporate purposes. Office
—111 John St., New York
38, N. Y. Underwriter—None.
at the rate of
&
to
are
the year to issue and sell additional- securities, prob*-A
from
to be¬
investment company of the closedend type, under the Investment;
Company Act and to
make a public offering of at least
$30,000,000 of stock
in the U. S.
Business—The trust, incorporated under
the laws of the Union of
Africa, has been organized to
provide a medium for investment iri the common shares
^-Washington General Insurance Corp.
stoek
Steel
Aug.
Smithy Barney & Co. (jointly)-. Bids—Expected to be re¬
ceived in Room 2033, 2 Rector Street, New
York, N. Y.,
ug tor noon (ZEDT); on Sept. 9.
mon; stock
overhead,
&
come
White, Weld & Co. and Stone & Webster Securities Corp.
(jointly); Salomon Brothers & Hutzler; Kidder, Peabody
•Set Co.; Eastman
Dillon, Union Securities & Co., and
Underwriter—None.
note,
ing capital and inventories^ Underwriters—Blyth & Co.,
Inc. and Merrill
Lynch. Pierce, Fenner & Smith,
struction program of the company and its subsidiaries
amounting to approximately $43,000,000 for the period
1968-1960; Underwriter—To be determined
by competi¬
tive bidding.
Probable bidders: Halsey,, Stuart & Co.
Ino;^First Boston Corp. and Blyth & Co. Inc. (jointly);
share.
in
preferred stock, or a combination of the
two, including
bank loans.
Proceeds—For expansion program, work¬
borrowings, and the balance together with further
borrowings under a bank agreement and cash generated
per
open
f 1
stockholders
a
-
March 21 it was announced that the
company plans addi¬
tional financing this year, in the form of
common stock,
bank
Price—$1
repay
the-
approving
on
Equitable Gas Co.
- >
July 18 it was announced that the
Prospective Offerings
Utah Power & Light Co. (9/9)
June 26 filed $20,000,000 of first mortgage bonds due
"1988.
Proceeds—To redeem $15,000,000 of first mort¬
gage bonds, 5*4% series due 1987, to repay
$4,000,000 of
(no par).
to
\/.
that
reported
was
>
P. Hunt
to carry forward the
it
proposed offering of
$10,000,000 2d-year convertible subordinated debentures.'
Underwriter—Dillon, Read & Co., Inc., New. York.
Salt Lak*
—
stock
subsidiary,
Kirkpatrick, Inc. and W. N. Estes
Inc., both of Nashville, Tenn.
Utah Oil Co. of New York, Inc.
May 6 (letter of notification); 300,000 shares of capital
stock. Price
At par ($1 per share). Proceeds — For
development of oil and gas lands. Office—574 Jefferson
mon
Sept.-15
ably preferred stock, to
City, Utah.
din the business will be used
18
vote
3t
of additional funds.
of
Landstreet
stock.
mon
Jefferson,
ir Cosden Petroleum Co.
Aug.
research, salaries, purchase of raw materials and sup¬
plies and for working capital, etc. Underwriters—Clark,
Utah Minerals Co.
\
Edwin
—
opment
Pres¬
■
.
share of stock and one-half warrant due
Aug. 31, 1962.
Price—$2 per unit. Proceeds—For research and devel¬
•
■,
bidding." Probable bidders; Morgan Stanley & Co.; The
Ripley & Co. (jointly); >
White, Weld & Co. and Shields & Co. (jointly). Bids—
Expected to be received on Sept. 23.
/'/ *
ic Wizard Boats of Tennessee, Inc., Dickson, Tenn.
Aug. 11 (letter of notification) 150,000 shares of com¬
mon stock
(par one cent) and 75,000 shares of common
stock purchase warrants to be offered in units of
one
ident.
■
:
First Boston Corp. and Harriman
publicly offered at $3 each. Proceeds — Foi
general corporate purposes. Office—151 Adell Avenue,
properties, and the balance for other corporate
purposes. Underwriter—None,
i
Uranium Corp. of America,
Portland, Ore.
April 30,1957 filed 1,250,000 shares of common stock (pai
cents). Price—To be supplied by amendment (ex¬
pected to be $1 per share). Proceeds—For exploration
purposes.
Underwriter—To be named by amendment.
Portland,
(9 23)
•
System, Inc.
be
to
are
ment of
of
Co.
^
Wilier Color Television
April 2 (letter of notification) 72,035 shares of commoi
stock (par $1) of which 10,000 are to be offered to stock¬
holders at $2 per share and the
remaining 62,035 share*
Recovery Corp., Chicago, III.
June 4 filed 37,500 shares of class A common stock. Price
—$4 per 6hare. Proceeds—For exploration and develop¬
Griswold
Power
announced that the company plans to issue
was
preferred stock (no par). Pro¬
ceeds—For expansion and improvement of service facili- )
ties.
Underwriter—May be determined by competitive
None.
Universal Oil
Albert
Consumers
Thursday, August 21, 1958'
.
and sell 150,000 shares of
—
Temporarily deferred due to present market conditions.
Graham
•
Aug 19 it
.
.
Corp.
Bids—To be
and
re¬
/
•
Kentucky Utilities Co.
June
16 company stated it will sell bonds and/or com¬
stocky to Jthe dast quarter of 1958.
Underwriters—
Blyth & Co., Inc. and J. J. B. Hilliard & Son.
mon
Laboratory for Electronics, Inc.
July 3,
Henry W. Harding, President, announced that ;
are currently
considering refinancing $790,outstanding notes ($658,750 held by a principal
the directors
000
of
Volume 188
Number 5770
.
.
The Commercial and Financial Chronicle
.
(739)
stockholder and $131,250 by a bank) on a more perma¬
nent basis.
This may be done through equity or con-N
determined
yertible debenture financing.
Forgan &. Co.; Blyth & Co., Inc.
ton, Mass.
r
Office—r-75 Pitts St., Bos¬
:V.
..
•
-
ment
Proceeds—For investment,
v.;
:
...
JI t*
in
of
an
undetermined amount. of first mortgage
(about $10,000,000). in the latter part of this year
early
Proceeds
1959.
—
To
repay
bank
about
•
stock
loans.
later
stockholders
to
this
Underwriter—To be determined by competitive bidding.
Probable bidders: Halsey, Stuart & Co. Inc.; Blyth & Co.,
Inc.; Merrill Lynch, Pierce, Fenner & Smith and Kidder,
Peabody & Co., Inc., (jointly); and Blair & Co,, Inc.
July 30
company applied
sion for
•
.
series
"4
.
v
Moore-McCormack
,
Lines,
Inc.
(9/15-19)
.^
will
may
July 29 it
was
Tele.
Co.
*
^
"this
bidders:
Halsey,Stuart- &
Probable
Eastman -Dillon,
intended
Jackson
New Yerfc State Electric and Gas
"r
JVlarch 7 it
was announced
that
Stone
$7^500,000
10
it
Illinois
the
)
Federal Reserve'Bank of: Dallas.
in
the
reduction and
future.
credit liquidation
Inc.;
of strength and notes rise in
government
new
fail.
was
Co.
(Indiana)
announced company has under considera¬
Offering—Expected in the early Fall.
the favorable
Cites
of
both
favorable
inventory
cial
Government Spending
"Another factor which has ele¬
favorable
effects
is
and
the
as
this factor
- points
supplied by
the Federal Reserve System during the past six months is a con-
out
"credit
ditioning
promote
ease,
factor
an
as
d
e s
i g ned ' to
environment
covery."
I: The» monthly
of
re.
publication
•
finds
in
its summary and prospects for
the future that "the trough of the
recession may have been reached
during April
or
early May, since
recovery.
factors exerted both favorable and
unfavorable influences. Continued
inventory liquidation still
tutes
consti-
depressing force on industrial production, but with a numbei* of industries completing their
adjustments, such liquidation may
a
"Consumer credit developments
have
the
been
decisions
result
restrict
to
of
buyers'
their
.
,
.
,.
,
of
durable
goods.
distinctly favorable factor to
the
moderate
recent
dnd
in terms of its impact on general
ment credit. This reduction in in¬
lar
business
stalment
slightly upward direction
during late May, June, and early
conditions,
siderabie- potential
the
the future trend
course
of
the
clearly,
the current Mideast crisis has
July. By midsummer, the key. to
near-future
but,
prospect,
cash
increased
has
and farmers are buying
equipment.. The strength
of
the
been
situation has
agricultural
one
of the brightest spots in
the economy thus far in
1958."
dustrial
industries
ment
for
showed
the
real
second
month. While part of
improve¬
Wm. R. Staats & Co. Adds
(Special to The Financial Chronicle)
SAN
FRANCISCO,, Calif.
—
Robert S. Viele has been added to
of William R.
the staff
Staats &
Co., Ill Sutter Street.
consecutive
this advance
may
Dean Witter & Co. Adds
(Special to The Financial Chronicle)
SAN
Jorry M.
the staff
Co., 34 North
JOSE, Calif.
—
Miller has been added to
of
Dean
Witter
&
First Street.
,.
..
the economy moved in an
irregubut
in
rather broad
pur¬
Since
year
'
—
more new
the near-term economic future has
been
■
■
income
sharply,
Industrial Production
"A
have been based on tem¬
porary factors, such as increased
early 1958, consumers have been
steel production to meet t'he de¬
reducing
their
outstanding
in¬
mand
generated by prospective
debtedness. Consumer credit de¬
mean-, more
orders and renewed
price increases, other improve¬
clined $2.1 billion from December
ments in output have been solidly
production in the near future. The
1957 to April 1958, as repayments
r~
based upon rising orders and the
wor^nlng international situation steadily exceeded extensions,
cannot be accurately appraised yet especially in automobile instal¬ completion of inventory adjust¬
chases
duction
farm
in
stimulate the economy, the pro¬
spective deficit resulting from the
rise in spending will be a potent
spending, industrial
position insofar
concerned."
un¬
rise
government defense spending.
While initially this will serve to
source
is
■
..
improvement in in¬
production. Every major
inflationary force.
Increases
in industry showed some increase in
r
In painting a portrait of the
economy seemed to be the balance
output from May to June, led by
wages in many industries—partic¬
postwar recession of the past 12 of
several
currently
divergent
substantial gains in mining and
ularly the boost in government
months, The F e d e r a 1- Reserve trends." ;
durable goods production. Steel,
pay scales—provide a significant
Bank
of
Dallas, Texas,
in- its"Some ;of the most important
fabricated metals, and machinery
upward thrust to personal income.
August Business Review,
production and agricultural
Corp.
announced company plans to sell about
York.
potential
as
until
public offering of ap¬
proximately $200,000,000 of debentures. Proceeds—Prob¬
ably for expansion, working capital and other corporate
purposes.
Underwriter — Morgan Stanley & Co., New
Oil
ments
enumerates
economic
near-term
consumer
*
& Co.
was
expected
securities in the last half of the cur*
yet been
by com¬
petitive bidding. Probable bidders: (1) For any bonds—
Halsey, Stuart & Co. Inc.; White Weld & Co,; The First
Boston Corp.; Kidder, Peabody & Co.; Merrill Lync%
Pierce, Fenner & Smith; Eastman Dillon, Union Secu¬
rities & Co. and Salomon Bros. & Hutzler (jointly!;
Kuhn, Loeb & Co., and American Securities Corp*
(jointly). (2) For any preferred stock—Merrill Lynch;
Pierce, Fenner & Smith; Salomon Bros. & Hutzler and
Eastman Dillon, Union Securities & Co., (jointly); Leh¬
man Brothers; Kuhn, Loeb & Co. and A. C. Allyn & Co.
Inc. (jointly); The First Boston Corp.; White, Weld St
Co.; Kidder, Peabody & Co
To refund outstanding
Stuart
Corp. Offering—Not
early in 1959.
or
tion long-term financing through a
July 30 it
Supplying Real Growth to the Economy
factors
;
(9/30)
Boston
year.
The type of securities has not
decided on.
Underwriter—To be determined
!
Halsey,
Light Co.
^ Worcester Gas Light Co.
Aug. 18 it was reported that the company plans the sale
of $5,000,000 first mortgage bonds, Underwriter-—To he
determined by competitive bidding.
Probable bidders:
Halsey, Stuart & Co. Inc.; Estabrook & Co. and Coffin
&
Burr, Inc. (jointly); Kidder, Peabody & Co. a ad
White, Weld & Co. (jointly). Offering—Expected this
Standard
company
calls for $90,000,01)0
Forces
Probable bidders:
&
announced that company
rent
Morgan Stanley & Co.
Company's 5-year construction pro¬
outlay. Underwriter—To be
year.
;.v..rp'Tj.
First
$12,500,000 of
an
additional 100,000
preferred jst6<3k>/'(par $50).
Underwriters& Webster Securities Corp. and Paine, Webber
bidding.
Power
was
Wisconsin Public Service
Offering—Expected in
—
The Chase Manhattan Bank will
$10,000,000 of first mortgage bonds.
March 4 it
of
Proceeds
Kingdom.
this syndicate
the fiscal
late in 1958
shares in exchange for out¬
- Underwriter—Paine,
Webber,
Telephone Co.
United
to head
are
City
York, and Bank of America National Trust
Savings Association.
The
Power Co.
Bell
the
and
—
program
by competi¬
Underwriter— To be determined by competitive
issue.
Federal Power Commission. .In event this
project, has to
be deferred,.company will likely issue $10,000,000 bonds
in
construction
be determined
&
35-year debentures.
will sell this Sep¬
$20,000,000 mortgage ,bonds providing ; new gas
supply from Northern Natural Gas Co.. is- approved by
gram
offer
Southwestern
tember
later
to
Canada
plans to issue
Proceeds—
To retire bank loans and for construction program. Ue*
derwriter
To be determined by competitive bidding*
Probable bidders:
Halsey, Stuart & Co* Inc.; Smith,
Barney & Co. and Robert W. Baird & Co., Inct (jointly);
Equitable Securities Corp. and Eastman Dillon, Union
Securities & Co. (jointly); White, Weld & Co., Kidder*
Peabody & Co. and Salomon Bros. & Hutzler (jointly);
July 10 it was announced Missouri Public Service Com¬
mission authorized the company to issue $110,000,000 of
Gas Co.
announced
was
to
Jackson & Curtis.;'. />'V
this year or in early 1959, depending upcm prevailing
market conditions. Underwriter—For any common stock
The First Boston Corp., New York.
Northern
for
and
American
The Chase Manhattan Bank, The First National
and sell
stockholdersauthorized
9
shares
financing will be required for "construc¬
tion, expenditures for the balance of this year.;;The man¬
agement intends to negotiate a neyv line ofcreditvyith a
group ojf banks and expects to sell equity securities later
June
loans
Southern Colorado
May
:
;
approximately
from additional
bank
Curtis, Boston, Mass.
October, 1958. ''p.1 yY-'V ;
r
Corp. (jointly);'White, Weld & Co.;" Harrlman Ripley &
po. Inc. Bids—Expected" to be received up to T 1:30 a.m.
^>:yy/V":*•'^'
States,
March 17 it
an
17,000
standing preferred stock.
.
Union Securities & Co. and Stone & Webster Securities
(EDTf"on Oct/1;
United
Wisconsin
The stockholders on May 21 voted on
increase in bonded indebtedness of $6,-
an
State Su¬
Proceeds—
the
agent for the credit. The amount of the
financing involved is in the neighborhood of $259,000,000. The purpose is to restore government balances
which have been reduced by the repayment of excessive
short term obligations previously incurred.
;
compauj
plant to
preferred stock "sometime
or
York
of
new
Sanborn Scientific Instrument Co. (Mass.)
Aug. 4 it was reported company plans to issue and sell
100,000 additional shares of common stock, of which it is
bidding.
Co. -Inc.;
.
be
Underwriter
& Co. Inc.
(10/1)': .:
by competitive
&
tive bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
Smith, Barney & Co.,' Glore, Forgan & Co. and Blair
(jointly); White; Weld & Co.; Equitable Secu¬
rities Corp. Last preferred financing was done privately
Underwriter—None.
refund
determined
summer."
Underwriter—For bonds
$15,000,000 outstanding 5J/2% sinking
fund debentures and to repay bank loans. Underwriters
be
$6,500,000 in bonds
short-term
Aug.- 4 it was reported company plans to issue and sell
$25,000,000 of 25-year sinking fund debentures. Pro¬
r-To
the
increase in preferred stock from 25,000
shares to 50,000 shares.' Proceeds — For repayment of
Proceeds—To repay temporary loans made to finance the
ceeds—To
loans.
New
Fund
The three institutioxia* which
Joseph Light & Power Co.
it was announced that the
500,000, and
American.Telephone & Tele¬
graph .Co., the parent, owns over 80% of-the 3,504,809
outstanding" shares. v Price —At par ($100 per share).
Co.
bank
15
authorizing
for each five shares held.
Gas
st.
market
Sept. 26, 1958 the rigths to sub-r
scribe on or before Oct. 24, 1958 for 700,961 additional
shares: of capital stock on the basis of one new share
Fuel
(9/17)
4b-the Indiana P. S. Commis¬
reduce
the
Research
Venezuela (Government of)
July 1 the Government announced that Kuhn„ Loeb St
Co. and Kidder, Peabody & Co., both of New
York;, have
been selected as financial advisors to develop a financial
program for the country.
As a first step in the pro¬
gram a short-term credit is being negotiated between the
government in cooperation with the two investment
banking firms and a syndicate of commercial banks, in
Bank of New
April
stockholders of record
National
Petroleum
Society. Underwriters—Expected to be Leh?-'
Brothers, Smith,-Barney & Co. and Merrill Lynch,,
Pierce, Fenner & Smith, alL of New York. Offering— •
Expected in mid-autumn, probably late in October..
one
Proceeds—To
and $60,000,000. Approval
with
Court (expected within two months).
the
are
6.
rests
Chemical
—Blyth & Co.«, Inc., New York and San Francisco.
(9/30)
announced company plans to offer to its
company's expansion program.
Indiana, Inc.
between $50,000,000
transaction
man
subscription by common stockholders on the
new. preferred share for each
20 common
held as .of Sept. 16, 1958; rights to expire on
of
Oct.
•
&
the
To
of
shares
Argentina. Underwriters—Kuhn, Ldeb & Co.
Lehmair Brothers, both of New York.', :
;
State Tele.
run
of
basis
and S., S.
Mountain
was reported that an issue of common stock
be offered to the public, the proceeds of which,
soon
offered for
March 24 it was announced company plans to issue and
sell $24,000,000 of government insured bonds secured by
a first preferred ship mortgage on the liners S. S. Brasil
and
of
,
^
Universal Oil Products Co.
Aug. 13 it
authority to issue and sell 242,826 shares of new
convertible preferred stock (par $100) to be
f
•
•
••
Service Co.
Public
plans to market)
company
stock in the latter part of
quarter of 1959. Proceeds—For
common
construction program.
Underwriter—
year.
None,
.v.-.-
.
■
Co., St. Louis, Mo.
announced
was
$30,000,000 of
this year or in the first
.
-
Peoples Gas Light & Coke Co.
Aug. 1 the directors approved a program for the offer¬
ing oi approximately,.$17,000,000 of additional capital
pl^.ns to issue
Long-term
Union Electric
March 28 it
was
New York.
Utilities Co.
new
York.
preme
sell
and
early 1959. Underwriter
(Republic of)
July 14 it was announced a public offering is expected
of approximately $26,000,000 external bonds. Proceeds—
To redeem certain outstanding debt and for Panama's
feeder road program.;; Underwriter—Lehman Brothers,
Underwriters — Stone & .Webster Securities
Corp. and White Weld & Co., both of New York.
bonds
sidered.
Panama
-
one
ably this falL
IInderwriter—Fok bonds to be determined by com¬
petitive bidding; ' Probablebidders: Halsey, Stuart &
Co. Inc.; Morgan Stanley & Co.
008,000.
the company
or
share for each 12 shares
held, proton
financing is also* being- conUnderwriter—Kidder, Peabody & Co., New
an
stock
gram.
bonds, unsecured notes and common, stock.
Proceeds—To build pipe line system to cost about $111,-
announced
of this year
the rate of
of
Telephone & Telegraph Co.
reported company plans about $250,000,000 of financing-late this year (part in bonds and bal¬
ance in common.stock).
Proceeds—for construction pro¬
mortgage
was
sale
Pacific
July 31 it
/
March -24--it., was
announced
that this subsidiary
ol
Tennessee Gas Transmission Co. has applied.to the Fed¬
eral
Power Commission for permission to issue-first
Montana-Dakota
plans
of; bonds and/or preferred
amount
bid¬
Probable bidlers: The First Boston Corp.; Halsey,
Stuart & Co. Inc.; Blyth & Co., Inc.; (2) For preferred
stock: Blyth & Co.,ylne.;:,:^v,f-^
it plans to issue on oj
1958 $3,200,000 of first preferred mortgage bonds.
May be placed privately. Proceeds ~ Tc
repay bank loans and for working capital.
.<►;
March 24 it
-
company
ding.
before Dec. 31,
Midwestern Sas Transmission Co. V
reported
was
Thiokol Chemical Co.
Aug. 4, J. W. Crosby, President, announced company is
planning to offer to its common stockholders some additionai common stock (approximately 105,488 shares) at
bonds to be determined by competitive
For
—(1)
Midland Enterprises, Inc.'
March 28, company announced
J
it
in the latter part
10,0r > shares of capital stock (par $1). Price
jsharV less an underwriting discount of 8 Va%,
r—510 per
20
undetermined
*"lans to offer to bona fide residents of
company
bidding. Probable bidders:
Co. Inc.; First Boston Corp.; Glore,
&
Pacific Gas & Electric Co.
March
Master Fund, Inc., Fairfield, Calif. ;
Jan. 27 it was announced this newly Organized Invest¬
California
competitive
by
Halsey, Stuart
39
con-
influence
of business."
on
ments.
Now With McGhee Co.
(Special to The Financial Chronicle)
credit
probably
c o n-
tributed to the. decline in sales of
consumer
durables but placed
consumer
in
a
much
the
better finan¬
"Another
support
force
toward
supplying
recovery
is
real
the
agricultural industry. With favor¬
able prices and a
near-record pro¬
with
— John C.
McGhee &
2587
East Fifty^
CLEVELAND, Ohio
Davis
is
Company,
now
Inc.,
40
The Commercial and Financial Chronicle
(740)
Pays
Capital
Dividend &
Corp.
Analyzed by
Ira
Iiaupt & Co.
Mutual Funds
Cains Distribution
By ROBERT R. RICH
directors
The
Nation-Wide
of
A
special report by
f
Securities
Company, Inc., a bal¬
fund under Calvin Bullock
anced
management, has declared
year-end
dividend
vestment
income
share and
from
of
in¬
cents
per
year-end distribution
a
securities
net
25
fiscal
a
net
from
profits
of
60
Mutual Fund
Purchases
by
investors of open-end investment company
(mutual fund) shares reached a record monthly figure of $160,-
rable
members.
share. Both are payable
Sept. 27, 1958 to shareholders of
record Sept. 5, 1958.
markets.
Monthly purchases by investors have exceeded $100 million,
with
to 73 cents per
amount
year
chare from investment income and
4>0 cents per share
from net securi¬
ties profits.
$30,211,261
on
July 31, 1958 as aganst $25,619,347 on Dec. 31, 1957. Net asset
value per share on July 31, 1958
was
$19.6Q as against $17.32 on
'
*
Slis. Increase J 3.7%
T.' Rowe
Price
Inc.,
Growth
reported
Stock
today
to $11,909,30, 1958 from $9,436,114 on Dec. 31, 1957.
During the
first six months of 1958, net asset
226
June
on
value
share
per
increased
13.7%
from $27.67 to $31.45.
During
this
stockholders
shares.
chare
period
subscribed
515
new
Fund
to
A dividend of 32 cents per
from
paid
ordinary
June
net
income
1958 to
^stockholders
of record
May 29,
1958.
This represented the same
amount as was paid in the cor¬
responding period a year ago.
was
on
in for redemption during July were valued at
number
The
of
accumulation plans opened
new
26,
1.9,544.
and
funds
and
in
period
declining
Yet its shares
asset
net
value
of
of
According
Plastic Sales of
Colton
Yearly
May Be Achieved
ing
of plastics
use
National
old
could be hoisted
foundation,
in sections to its
sembled
on
ready for
in the build¬
the next decade
nual sales volume of over $2
its
from
could quadruple in
providing an an¬
industry
of
locality," Robert
writes, "the
new
a
all plastic house
Billion
The
to
bil¬
of
new
new
a
occupancy
trucked
site and
as¬
the
to
report,
Railroad.
Additionally, in recent
Pennroad
sellng
pressure
tax
who
has
value
asset
net
all
eight
of
assuming
companies
from
showed
rises
basis
same
low
as
84%
as
sharp stock market break
the last quarter
Pennroad's
against
asset
an
of
1957,
fell
value
3.5%
decline
average
of
ahead
terials and
only steel, lumber
now
moisture
barriers, piping, lighting
structural
panels
and
fixtures,
wiring
devices
among
Nylon,
INVESTMENT
are
FUND
Ukatmat
WRITE FOR
FREE INFORMATION
FOLDER AND PROSPECTUS TO
YOUR INVESTMENT DEALER OR
NATIONAL SECURITIES &
materials
familiar
struction
RESEARCH CORPORATION
Etfablishtd J930
durable, easier to clean and
stronger,
colorful and
lighter,
terials.
cant
contributions to most of the
more
major
more
many
"If necessity
also
ma¬
demanded
a
of
chemical
companies and
firms in the rubber, petro¬
become
important producers
plastic materials.
23.86%
reach
all-time
high
the
fund's
semi-annual
Common
88.10%
stocks
of
bonds
securities
10
into
a
On
recent
seeking
holders
of
were
1957
com¬
market
proceeds
The
we
much
up
had antici¬
the
the
obligation, the Prospectus and other infor-
were
and
reflected
stocks
J
in
American
$75,000,000, for
since inception
1933,
assets
of
of
to
'?•'
$75,314,398
and'8,640,561 shares outstandinging on Aug. 8, compare with $59,805,980 assets and 8,001,847 shares
outstanding as of Dec. 31, 1957.
This growth in total assets came
froin: expanded sale of the Fund's
as
uary.l
well
as
the rise in value
holdings.
tax
L.
American MutiiaPs
the
■Net Assets at
All-Time Plateau
fund's
Total
Mutual
high of
1958, it
net
Fund
together
sale
shares,
of
was
31%
Oct.
an
was
in
what
issues
returns
and
offering
justifica¬
our
portfolio
the
depressed
affected
on
Dec. 31
prices
of
by year-end tax
selling, these issues," the re¬
Lovelace
B.
increase of
over
in
his
re¬
$19,599,941,
$7.15
to
share
July 31,
months earlier.
$7.98
nine
represented a
adjusting for
after
or
the $63,768,099 total on
31, 1957. Net assets
This
per
on
gain
of
capital
14%
gains
distributions of 16 cents per share.
Total shares outstanding rose to
10,442,187 from
period.
with
new
July 31,
stated by President
to
increased
the
record
a
on
the shareholders for the
third quarter of fiscal 1958. This
Delaware's
course, share¬
to
American
of
reached
$83,368,040
Jonathan
port
of
decided
assets
Fund
from
quality
"While
I
time
Fund
''Total net
other
tion for investment at the time.
ADDRESS
first
the fund
from
reasonable
KAMI?
exceeded
according
Edward P. Rubin, President.
ac¬
considered attractively-
priced
I
8, 1958, the total net
Selected
of
Shares
told that toward the
earlier,
Delaware
mation concerning the Franklin Custodian Funds.
L»H<
way
30.
ahead with its buying program.
anticipation of a rally some¬
FRANKLIN CUSTODIAN FUNDS, INC.
Street, New York 5t N. Y.
Aug.
assets
shares,
industry
date
13.17%
for
64 Wall
-STATE.
our
Up Sharply
time this year, it continued to in¬
vest
cash
withdrawn
from
the
-ZONE.
of
few weeks ago,"
a
of the portfolio
June
largest
summary
investment
go
CITY
its
on
rapidly than
for
equipment, 6.72%; building,
6.42%; steel, 6.21%; machinery,
5.64%; chemicals, 4.11%; drug,
4.07%; natural gas utility, 3.87%;
and container, 3.51%.
industry.
|
time
Total Net Assets
spread
were
on
that
on
resources.
close of
I
the
net
total
convertible
147
I
HOWARD, Incorporated
24 Federal St., Boston, Mass.
that
Selected American
report
accounted
Delaware's
are
I
A
noted
-
year,
major
industry investments included: oil,
In
EATON
also
stock.
ican
|
oppor¬
at
the close of the first
The per share net asset value
half; 2.08% was invested in pre- was $8.71 on Aug. 8, contrasted
with $7.47 at the year-end.
ferreds; 5.28% in industrial bonds;
In
1.98% in short-term Governments; addition to this increase in asset
and 2.56% was held in cash. Most value, a capital gain distribution
of the preferreds and industrial of 26c per share was paid in Jan-
possible growth and income through investment in Amer¬
or
fund's
assets
In
Investment Dealer
the
enterprise.
report
compress
pated
$55,last, against
shows.
total
FUNDS
Prospectuses available from
of
excellent
an
of American
of
991,357 on June 30,
$45,205,410 at the start of the
holdings
CUSTODIAN
Please send me, without
bulk
tunity to participate in the future
economy
rose
12.07%; electronics and electrical
I
the
and
power
in the first half of 1958 to
an
Delaware's
on
FRANKLIN
your
comprise
more
Net assets of Delaware Fund
counted
I
price paid
they shall continue to
them,
may
Electric utilities headed the list of
about this series of Mutual Funds
productive
"developments in the Middle East
Value Gains 18%
Assets of the fund
now
are
as
common
recuperation period and start the
over
Find out
long
as
find
can
which
The
mon
Get the facts
continued,
holdings, since they seem to offer
the best available protection
against declining purchasing
of
perhaps cheaper than leum and related industries have
homes made of conventional
stocks
to
advantages. Such homes
be
it
workers well worth the
for
•
Thousands
be
many
has already built an experimental, radios, TV lenses and appliance
all plastic "House of the Future"- panels and handles.
to demonstrate its inherent con¬
Sales of plastics make signifi¬
could
Broadway, New York 5, N. Y.
others.
polyethylene and vinyl
now
securities,
5.5%.
Asset value per share at mid¬
year amounted to $10.14 as com¬
applications of
pared
with
$8.68
six
months
plastics are being made in appli¬
housewives who see them every
previously — an 18% gain after
ances,
containers, furniture and
adding back capital gains distribu¬
day in furnishings and appliances other household
goods. Furniture
tions of 101/2 cents a share.
throughout their homes. "Atomic drawers made of
phenolics never
Activities" points out that acryl¬
The number of shareholders and
warp or stick and can be cleaned
ics, polyesters and many more of under tap water. Polyethylene is shares outstanding also rose to.
the
record levels in the period. On
prolific plastics family are popular
for
containers,
bowls,
also achieving widespread ac¬ buckets
30th,
5,519,626
Delaware
and garbage cans. Poly¬ June
ceptance for' household use and
styrene with freedom from taste, Fund shares were owned by 19,730
conceivably some houses of the odor and toxicity makes it ideal individuals
and
institutions
as
future may be macle entirely of
for food utensils and containers. compared with 5,210,563 outstand¬
plastic.
;
••' -v
• ■ '
In a special heat-resistant form, it ing shares and 18,717 shareholders
Monsanto
Chemical
Company is used for cases or clocks and on Dec. 31, 1957.
A MUTUAL
The effect their
has
Delaware Fund
and
Delaware's Share
lion, according to National Securi¬ and glass enjoy greater utilization
ties & Research Corporation. The in the
building trades industry.
investment company, which spon¬ "Built-in" uses include
paints and
sors
and
manages
the National surface coatings, floor coverings,
Securities Series of mutual funds
In the
during
of
But,
Pennroad's
reinvestment
the
on
enthusiasm,
especially
on
stock
prices
carefully weighed
in
evaluating future investment op¬
portunities, the report cautioned.'
dividends, rose 111%; the
other leading
closed-end
.
ob¬
was
and their demand for all
commons,
must
Plasties
already have pushed
the many traditional ma¬
types
formerly held it for
era
whose
the market.
presence
1952 to Septmber 1957,
Haupt study reports, the
Ira
holdings,
of
ened
from wealthy in¬
During the bull market
investors
of
reasons.
January
it
confidence and seemingly limitless
investment dollars have strength¬
under
come
investing,
a
inflationary implications—a feel¬
ing shared by a growing number'
the
investors still mistakenly associate
Pennroad with the Pennsylvania
years
situ¬
report, still seems to
large
proportion
of
equities in view of present inter¬
national developments and their
because
foundation,
in a matter
hours."
Prudent
portfolio
undervalued
are
favorably
more
served in the
warrant
investments.
shares
replaced them with stocks of
companies
ated.
stock
selling
are
earnings and divi¬
dend prospects seemed to warrant
and
compa¬
averaging 95%.
issue of "Atomic Activities."
120
pe¬
Cash, U. S. Government securities and short-term corporate
obligations held by the 146 open-end member companies of the
Association totaled $715,165,000 at the end of July^ This compares
with $767,443,000 at the close of the previous month and $553,943,000 at the end of July, 1957.
[1 ■[*.%/
move
than near-term
relatively high discount below-
a
the
the
makes the estimate in the August
,
at
rising
vestors
for the
purchase of mutual fund shares rose to 19,618 in July. New
plans started in June'totaled 19.489; in July a year ago, the figure
with assets exceeding $350 million
;
In July a
mutual
both
riodic
that
total assets increased
high of $11,121,627,000 at
$41,493,000. In June, redemptions totaled $39,981,000.
year ago, they
came to $37,298,000.
was
Price Crowlli Fund
new
July, according to the Association. At the close of the
previous month, they came to $10,609,839,000 and, as of July 31,
1957, they were $9,816,489,000.
"
v
were
1957.
a
the end of
Shares turned
Total net assets
Fund,
exception—February, 1958, when they came to $96 mil¬
the last 32 months, the Association said.
Total net assets also reached
"
Dec. 31,
one
lion—for
Total payments in the 1958 fis¬
cal
companies
liquidated or reduced
in
companies
whose
prices had risen faster
market
Ira Haupt
outperformed other closed-end in^vestment
675,000 in July, the National Association of Investment Companies
announced in reporting lor its 146 open-end investment company
cents per
The fund
positions
& Co., investment bankers, points
out that Pennroad Corporation has
July Sales Break All Records
Thursday, August 21, 1958
.
port noted, "gained ground shortly
after the first of the year and our
total net assets figure showing a
corresponding rise."
Peimroad
Nation-Wide
.
.
8,921,330
during
the
-
Net
gain
income, 'excluding realized
sales of securities, for the
on
nine-months period ended July 31
$1,734,203, equal to approxi¬
mately 18 cents per share on the
was
number of shares (9,608,outstanding
during
the
period. This compares with net in¬
vestment income, similarly
comaverage
585)
Number 5770
Volume 188
.
.
The Commercial and Financial Chronicle
.
puted of $1,500,032 or approxi¬
mately 19.4 cents per share on the
Fund Stresses
lesser number of shares outstand¬
ing in the corresponding period
year
earlier.
Investments in the electronics,
period just ending was $2,576,419,
compared with $4,061,571 in the
like period ended July 31, 1957..
!
.
New
of
names
stocks
common
the
to
radioandteiemnon field represe"ted 12.6% of July 15th total
net assets of General Industries
.
silareSj largest of Managed Funds,
jnc >s jq mutual fund classes, it
port 1 olio during
the third quarter
included Borden,
the
eliminated
entirely
issues
q j shares' contribution to the
fund group's total net assets of
million
559 5
from
amounted
$21.6
to
ciass's second largest hold-
include Bethlehem Steel,
Telephone,
K r
jng was |n
securities of the
Lily-Tulip;
jidjng and construction industry
o g e r,
Cup, Republic Steel^and Westing-
—about
house.
10%
-chemicals
net
of
field
The
assets.
the
represented 9.8%
the
in
3^%
in
activity
creasino
aid
P.
the
of
who
Viggiano,
cently
was
$12,380,423
(3), and Socony Mobil Oil (2.9).
Gift Tax Division
Revenue
Mr. Viggiano, a
University
School, is
tan
Otis Elevator (3.5), American Can
Internal
50,000th Fund Plan
Investors
sylvama and Fedeial Bars.
He
assisting Lew Kearns in the
prep-
Pianning corporation
50,000th
sale of its exclusive mutual fund
reports, servicing dealer
inquiries,
working
,,
«
with
1
attorneys,
ana
interviews
of
•
clients
Gf America completed the
gin*er. f°TrreTst R* Dayton' 32' of
clients'
•
1
•
■
-
•
participating
v#JtJaiuwin, jj, jit
an
^ plan was
brought
to
ton
at I.
the Wellington home office by se-
main
curities dealers.
of
Stires
ranged the sale.
:
Group
11.1%; public utilities,
drugs, 6.2%; oil and gas,
foods and
beverages,
Stocks
held
in
Wisconsin
companies include Wisconsin
Bankshares, Bucyrus-Erie, Kim¬
berly-Clark, Wisconsin Electric
k
and
respectively,
man,
mittee
of
S. L.
rw
of the
Sholley,
-
Keystone Fund of Canada,
Ltd.; Armand G. Erpf, New York/
President
New
York
Capital
^gnada, Ltd.; and Chaun-
^President
Waddell,
L.
cey
of
P> c.-Axe
L
troduced
in
October,
elected Vice-Chairmen;
1953,
of
jnvestors Planning
^on
In addition to the 50,000
Axe
four
the Com-
services
The Committee
serves
as
a
cen-
source
tered
investment
com-
of the mutual fund
type,
Canadian
are
for regis-
10,000
over
other
mutual fund accounts of all types.
'
" -
...
IllVestUlClll Stlldv
1 TilCCS
JuLlStOry
o.
Ol
Al¬
StrflllgC vrllt
bequest in the last will and
qualified for sale testament of a New Jersey physiA
As of June 30/
tian is the subject of a 33-year
the eight registered Canadian in-
investment study by the sponsor
to U. S.-investors.
of Group Securities, Inc.,
vestment companies had total net
$125,000,000 mutual fund. assets of $340,074,709 managed for
The doctor's gift was to be an
,
,
,
.
„
/
.
,
,
long-term investment in behalf of
more
than
127,681
reflecting
Canada's
economic
growth,
company
annual ice
cream
treat for all the
who save toward their chfl-
long-range
dren's college tuition or a fruitful
Canadian and
happy retirement face a simtcompanies also invest in securities jar problem, the study suggests
w
..
of
..
the
companies operatingrin 25 Free
World
countries.
The
registered
1
..
„
invGstiTient
vdnduidn
.
continuously
.
compsnics
a
re-invest
au
•
•
their
in-
in
ways
which
these
with the trend to higher costs,
.
_
..
.
'to
ital gains at
63 Wall Street, New
-
Distributors Group,
Inc.,
York 5, N. Y.
jt
-
$2,021,134 *
aggregate
an
14.4c-a
or
ot
26.4c
per
is
planned
told
that
stockholders
Under such
tax
losses
iiL his
the
distribution
ENYP
stitute
report.
and not be
Gas
Co.; Royal Dutch Petroleum
he added.
Co.
and
Light
Wisconsin
nadian
PQwer and
in holdings
Increases
Co.
included
Baldwin
Piano
International
Oil
Oil
Abacus
Co.
came a
under
(Indiana);
(Ohio); and
con-
a
dividend,
f
InternaSystem,
Fund in June, 1957 be¬
closed-end, non-diversified
investment
Co.
Co.
as
Formerly known as
Hydro-Electric
Ltd.; Goodyear Tire & Rubber
Co.; Signal Oil and Gas Co., class
Standard
taxable
tional
Co.; Ca¬
Power
will
reduction-of-tax-basis
a
.1958 included shares of Providence
A;
,
circumstances, in the
opinion of the company's counsel,
New additions to the investment
portfolio in the first six months of
the
company
Investment
registered
Company
Act of 1940. Abacus common stock
was
Company.
eliminated
in
Assets Rise 47%;
all
listed
Exchange
its
of
the
Shs. Increase 54%
g£
ended
July 31,
total
share, with dividends and dis-
tributions reinvested, gained 13%
in the first seven months of 1958.
The number of Fund shares out¬
standing at July 31 was 26%
greater than at the close of 1957
and 54% greater than at July 31,
1957, Mr. Fagan reported.
Mr. Fagan noted that the Fund
portfolio at July 31 last contained
an
unrealized
appreciation
of
$588,978. This appreciation was
$316,500 greater than the unreal¬
ized appreciation at the close of
1957.
During 1958's first half the
Fund
Trustees
reduced
stock holdings from 70%
At the
same
holdings
tO
Manu^cturin°
Eaton
to 64%.
time, corporate bond
raised from 20%
<3
National city Bank
ro
"auo dl t'fJ PanK and Chemical
01.wcw i:olk»
Distillers
Corp.; New Amsterdam Casualty
Co.;Niagara Mohawk Power Corp.;
Ohio Oil
Co.; Public Service Elec¬
Co.; Union Bag-Camp
Paper Corp.; United States Steel
Corp.; West Penn Electric Co., and
Youngstown Sheet and Tube Co.
tric and Gas
Also,
all
nadian
of
the
remaining
International
stock
ferred
•
•
-
|\1S0 111 ASSCIS 111
, -
TT
— _
JrlcllI-x6<ir
The
"
•
~
^ -
semi-annual
report, to
shareholders
Corp.
Reports Substantial
Gain in Net Assets
pre¬
Reports
a
.
Ca-.
Power
sold.
were
Abacus Ftl.
-•••
United
l?h st
-
New York-
National
common
were
30%.-
p„S
net
leaped 47%. Net asset value
^
?
of
showed
net" asset
the
pany
six
that
closed-end
increased
months
Abacus
June
on
30,
per
the
were
semi-annual report of The
Corp.
shows
that
net
asset value of the closed-end in-
United
from investments amounted
to $434,143, or 50 cents per share
-come
June 30.
011 the 855,716 shares of stock outstanding on June 30. At that date,
Mr. Jacobs added, unrealized ap-
preciation of $2,762,496 was contrasted with unrealized deprecia-
$96,- tion of $1,304,173 at Dec. 31, 1957,
697,299 or $6.87 per share on June an improvement of $4,066,669, or
30, 1957. The June 30, 1958 total $4.75 per share. Losses realized
does not include the capital gains on sales of investments during the
higher
than
dividend
of ;
net
assets
$1,407,214
December, 1957. '
of
paid
in six months period (based on average book cost), were $20,983, or
The increase in net asset value
in the first six months, amounting
two cents per
.
share.1;
compared with $27,920,188, or
$32.63 per share on Dec. 31, 1957.
William K. Jacobs, Jr., Abacus
vestment company rose sharply President, told stockholders that
during
the
six
months
ended in the first half of 1958, net inThe
,
1958.
June 30
$37.86
of
com¬
during
16%
ended
or
value
investment
Total net assets
$32,397,960,
Fund
share,
.
Copies of the study are availaWe
interested investors who
write
-
"future
keep pace
promises" may
vestment income and realized cap-
low tax cost.
ae-
on
the New York Stock
June 25, 1957 ini
place of the class A stock of In¬
following com¬ ternational
Hydro-Electric System.
panies: Allegheny Ludlum Steel
Corp.; Amerada Petroleum Corp.;
Bethlehem Steel Corp.; Iowa-Il¬
linois Gas and Electric Co.; North¬
Charles A. Fagan, Jr., Treasurer
ern Illinois Gas
Co.; Texas Eastern
of Income Foundation Fund, an¬
Transmission
Corp.
6.70%
pre¬
nounced that total net assets in¬
ferred stock; and United States
creased
to $6,845,575 during the
Rubber Co.
Reductions in holdseven months ended July 31, 1958,
.
j.
j .
r,
a
rise
of
39%. During the
12
r
S.
U.
share. In
a
securities
holdings
school children of his community.
Net assets on June 30 totaled
The study traces the effects of two
shareholders.
$99,946,374 or $7.10 per share comfactors, inflation and increasing pared with $84,723,938 or $6.02
assets
consisted
While
these
population, on the fulfillment of per share on Dec. 31, 1957, an
principally of investments in se- this "old promise" over the pass- increase of 18%.
curities of Canadian corporations ing years. Pointing out that peoThe June 30, 1958 total also was
their
f|iar,e' a total ^ of 27c
^
United
C
TT*
m
tral information
Corp.
I. P. C.-
plans currently in force, the
firm
mittee announced.
whose shares
in-
was
company was established, for exclusive distribu-
United Funds Canada, Ltd.; were
panies
plan
Boston! President" months after the
Ur
Fund, of
an
The
'
,
of
Axe-Houghton,
open-end mutual fund.
shares
pund
Investment
record
of
the half year amounted to stock distribution Abacus Fund is
$1,637,912 or 11.6c a share while completely
divesting
itself
of
profit realized 011 sales of securi- ownership of Eastern New York
ties was $2,166,093 or 15.4c a Power Corporation.
Texas
I. F. F. Total
per
orp.
His net investment will be used to accumulate
Companies, it was announced,.:
ronics
payments of $50.00.
re-
stockholders
in
Standard
assets
He made a one-year down payon
a $6,000
Systematic Investment Plan calling for monthly
the Com-
Canadian
of
Service
months
merd
_
outstanding. The divipayable July 31, 1958 to
book value per share was $3.74 on
*
Dayton, who lives with his par¬
e
co-Chair.,
,
Company and Wisconsin
Corporation.
Public
ents at 6 Ambrose Court in Bald-
n
Ltd.; have been
Power
win, is associated with the Hazel-
Boston, Vice-President of Canada
...
was
by Mitchel Sesskin of 71
Ave., Massapequa, L. I.,
the I. P. C. representative who ar¬
of New York,
-r.
Chairman
delivery of the plan
made
ada Ltd.; and William F. Shelley,
General Fund,
the office
president of
firm.
President of Scudder Fund of Can-
elected
in
Benedick,
St.
42nd
Merritt
Re-elected Head
Hardwick
East
60
headquarters
Final
Of Canada
presented to Dayr
C.'s
P.
Walter
the
Stires, Sliellev
of
Net investment income of United June 30, 1958, and that by this
.
share.
contractual plan to electronics en-
aration of
is
dend is
security prices dur- Abacus
shaie,
and
5.9%.
Law
share
including
30,
ine
laigest stocK
noicungs o>
mdustnes included: banks and ti-
5.9%
graduate of the
,
obligations.
9.9%;
I. P. C. Sells
member of the Penn-
a
June
.
and
m
nance,
Service.
Pennsylvania
of
on
,
7.9% of its total net assets in cor-
(3.9%), AmeriTelephone & Telegraph (3.8),
re-
and
Estate
the
securities
'
managed
jnghouse Electric
until
each
shares in 1956.
compared
1
review attorney in
a
of the total outstanding.
for
stock of Abacus Fund is-
and
distributed fund held 80 different
Other portfolio leaders were West-
The latest staff addition is Don-
sued
end.
June
on
^LshaS
The
Milwaukee
slightly.-, under 4% of net assets.;
Plan-
Estate
S5 JS Lnhi ^ipc
nnig and Institutional Sales.:
common
P01'tunity to sell certain portfolio tion, Mr. Jacobs announced that
sc?uritl^: .As a result of such Eastern New York Power Corsales sumcient cash was raised to poration had not been engaged in
Pay
the entire $8,000,000 bank the utility business for about five
jean which' had been incurred to years; that the subsidiary's assets
iinance in part the original in- consisted entirely of cash and
vestment in International Power marketable securities; that its net
of
Jl£
'^er^e^c^eadting
Corporation
pur-
Dec. 31, 1957. Net
asset value per share was $5.14,
equal to $5.23 after including the
nine cents capital gains distribution paid Jan. 31, 1958. This compares with $4.53
at 1957's year
end
the
ot General Motors Corp.—totaling
has
was
ing the period covered by the July 22.
rePpr^ "presented a favorabie opAt the time of the dividend
of the total, followed by the steel
During the six months period,
metals industry with 9.3%,
the mutual fund added $350,000
and the paper and container in¬
worth of U. S. treasury notes due
dustry with 9%. Cash amounted to
Feb. 15, 1965,: while reducing its
about 1.2% of net assets.
ownership of drug stocks by 4,-
Company
Wellington
International
stock
common
The rise in
semi-annual
at
with
Canadian
chased in the half year, increasing
such holdings to 766,370 shares or
;
The
$42,579, equal to five cents per
share, Mr. Jacobs reported. Directors of Abacus Fund, on July
Canadian
of
stock of Eastern New York Power
al
0 n
Power
-and
Wellington Adds
Tax Expert
stock
common
in
10 this year, declared an extra-*
ordinary dividend of one share of
^
were
investment
t i
report.
assets
iary at June 30, earned during the
first half of the year, a net income
of
its
to
Wm.
M.
Hickey,
President of United. He said addi-
Fund, Inc.
climbed
$1,624,196 between the
end of 1957 and June 30, 1958, it
revealed
appreciation of
public utility
according
a
net assets of Wisconsin
Net
41
of
domestic
and
International Power Co. Limited,"
general stock mar¬
ket recovery and also an increase
in total shares outstanding, total
$10,756,227
mjnion>
portfolio in the third quarter
General
Reflecting
is
rep0rted.
was
Brunswick-Balke-Collender^Cocaia'Tr Golgate-Palmolwe, Pfizer,
and United Fruit. Common stock
stocks
To $10.7 Million
Building Equities
on
sales of
nine-months
gain
the
in
market
United's
Assets Gain
,
realized
Net
securities
the
Wisconsin Fund
■>
Electronics and
a
(741)
In addition to the net investto $15,222,436 or $1.08 a share on ment
income of Abacus Fund,
United's
14,072,150
outstanding Eastern New York Power Corshares, "was due in large part to poration, a wholly-owned subs id-
011
„
42
(742)
The Commercial and Financial Chronicle
The following statistical tabulations
Indications of Current
latest week
Business Activity
week
Latest
AMERICAN IRON AND STfcEL INSTITUTE:
Indicated Steel operations (per cent capacity)
month ended
or
Previous
Week
Aug. 24
Month
Week
Ingots and castings
(net tons)
Aug. 24
(bbls.
average
gallons each)
Crude runs to stills—daily average (bbls.)
7
82.1
AMERICAN
ZINC INSTITUTE
July:
• '•
Slab zinc smelter output all
2,000 pounds)
8
Aug.
2,101,000
8
Aug.
6,544,735
27,589.000
8
6,439,435
6,797,515
7,727,000
6,836,185
1!7,597.000
7,607,000
8,008,000
28,693,000
Aug.
8
1,545,000
1,708,000
27,808,000
1,508,000
.Aug.
8
11,730,000
11,754,000
11,807,000
—
(bbls.)
(bbls.)
oil output
1,546,000
Shipments
Aug.
Gasoline
fuel
*1,632,000
Stocks
727,797,000
7,101,000
6,641,000
8
Kerosene
U.
-
fuel
Residual
oil
26,306,000
25,914,000
Aug.
—
178,715,000
124,838,000
Aug.
(bbls.) at
(bbls.) at
67,251,OUO
120,417,000
66,887,000
618,580
622,204
491.142'
ENGINEERING CONSTRUCTION
NEWS-RECORD:
CIVIL
Total
construction
S.
U.
505,622
404,208
172,973.000
32,554,000
141,999,000
■
66,155,000
State
and
9
9
$336,876,000
$513,960,000
$733,043,000
152,018,000
212,555,000
301,405,000
419,293,000
313,750,000
Aug. 14
148,749,000
242,168,000
183,379,000
154,732,000
59,237,000
lignite
DEPARTMENT
STORE
SALES
SYSTEM—1947-49
9
9
7,890,000
<7,695,000
428,000
76.000
119
••■
Aug.
100
=
•
■
•*'
v-
■
114
116
118
In
Aug. 16
*
INDUSTRIAL)
AND
—
COMPOSITE
AGE
262
„
steel (per lb.)
Pig iron (per gross ton)
Scrap steel (per gross ton).
METAL PRICES
Electrolytic
(E.
M.
&
J.
—
——
'
.....
6.138c
5.967c
$66.49
$66.49
$41.83
$42.17
$37.50
Aug. 13
26.100c
26.100c
25.175C
25.475c
11.000c
11.000c
11.000c
Aug. 13
10.800c
10.800c
10.800c
Aug. 13
10.500c
10.000c
24.700c
24.700c
94.750c
95.750c
93.875c
90.92
Aug. 19
?
91.46
93.08
98.73
96.07
96.54
93.23
93.52
Aug. 19
85.98
86.78
10.000c
Month
26.000c
/V.
Aug. IS
89.64
90.20
Aug. 19
.
Group
93.23
'90.63
v
98.57
84.55
.
91.34-V
V:
91.34
96.69
metal
4.20
Aug. 19
Aug. 19
3.88
3.83
3.69
4.10
((Three
4.00
3.97
3.84
4.20
1
Utilities
Public
Industrials
———i——
Production
4.19
4.17
4.54-:
'A: 4.40
4.19
Aug. 19
INDEX
—-—Aug,
3.96
3.92
402.3
400.2
(tons)
339.845
Unfilled orders
288.874
Aug.
9
Aug.
9
92
93
Aug.
activity—
(tons) at end of period
9
471.682
465.523
OIL, PAINT AND DRUG REPORTER PRICE INDEX—
1949 AVERAGE = 109
ROUND-LOT
■\Ca:
TRANSACTIONS
ACCOUNT
FOR
4.28
Zinc,
§§Zinc,
421.9
299,148
133,774
'
48
279,462
109.30
109.81
110.25
504,138
110.36
2,425,130
628,350
Total
1,773,920
1.296,400
1,696,920
408,420
481,540
68,700
57,200
221,320
11,400
-July 26
526,810
387,350
414,510
July 26
595,510
444,550
459,010,
.July 26
818,340
626,610
586,250
-July 26
146,760
154,420
123,970
54,470
July 26
757,269
677.041
567,660
383,896
904,029
Total purchases
account
of
Other sales
831,461
691,630
•(
1
44,500
.
—
.Tuly 26
3.897,210
t
224,630
236,030
690,990
2,838,311
2,278,570
3,966,489
3,529,301
2,847,560
Customers'
other sales.
i-t
Short
LABOR
shares..,
$62,830,596
1,078,923
i-
$49,733,718
•
.
.IV
•
-
19,974
1,501,114
15,196
1,351,754
SG6,151,566
$63,089,444
1,074,959
$45,238,603
506,670
492,770
345,950
228,670
506~670
492,770
1,082,638 I"
>
943.451
•
7.679
345,950
"
'
-
4.355
(per ounce)
489,470
413,290
32.590c
$62,385
■
( per pound)
Aluminum, V9%- grade primary: pigi_____L
$1.5500Q
vehicle
factory
1n-.u.
$1.55000
sales
$1.70000
$2.00000
$2.00000
26.100c.
27.100c
26.100c
"
V 24.060c
1
378.400
„
388,572
.' ■'.*•. "
406.857
.591.039
•337,664
495,918
,69,183
"
360
- "
1,203,580
936,610
15,398,340
789,380
13,169,780
'
-
'
"
.
,
'.
-.
•
19,731,390
16,334,950
13,959,160
9,614,590
333,210
;
.
)"-■
J
-".•••
•'
;
*•
'
$758,937,768
$369,282,162
621,3G5,01£(
^86,774.117
69,384,212
*74,110,423
24,000,000
•
-86,977,138
43,992,R11
57,000,000
—
"
>:
8,117,358
(Number .of >—
1
17,322,301
1,113,247
987,543
3,455,4iG7-
(Number
of)—
*
;!•
€.161.561
"•7.461,763
18,262,601
-
,c—
7,523,454
6,715,002
17,464,550
,
—
"
7,305,754
:■
Inventory
979,646
937;813
-
-
1,148.356
1,027.094
3,671y441
3,460,995
•
>-•-
334,286
(Number
Truck and
Bus
305,171
267,586
657,058
—
309.532
294,512
—
Inventory
Passenger Motorcycle,
Tubes
,318
■
-•
•
78,583;Q7G'- *
67,198,978 1
;
Tires
iSrt,
J'
.
ASSOCIATION,
'
—_•—
—
94.803
.J10
; '
Net railway'operating income before charges
Net income after
charges (estimated50,000,000
Production
9.281,380
:
■'-i'w.-A
J*
•
Tractor-Implement
18,527,810
...
62oi359J71
Shipments
$2.25
321,245
$791,614,723
Production
.
~66,967
.
Passenger Tires (Number of)—'
Shipments
Production
:
,
,'$2.25
-
operating revenues.:
461,950
"74.000c
manu¬
operating expenses..
Inventory
35.250c
74.000c
74.000c
from:
Number of motor trucks___
Number of motor coaches-______'-_l____^
228,370
25.000C
35.250c
$2.25
cars
'
24.000c
'*
assn.—Month of July:
vehicles___
'
2
35.250c
of
'
$1.70000
$1.55000
$2.00000
*
s.—automobile
INC.'—Mdnth of June:
:
33.500c
$1.70000
$1.55000
pound)__________"__2r__.
number
33.000c
$90,154
$1.55000
(per pound)_"2_,__r22l22_2_
^
(per
36.590c
$67,000'
$1.55000
;_i
t
(per pound
97%' grade, (per pound—ounce—ton)'
Aluminum. 99% grade ingot weighted average
RUBBER MANUFACTURERS
939,096
OF
692,742
€95,514
278.717
Inner
of)—
Shipments
:
119.0
*
*119.2
119.3
and
foods
118.1
93.1
*93.6
95.4
111.1
*111.9
112.7
106.8
97.9
109.9
115.1
113.8
Aug. 12
126.0
126.1
125.7
Ulncludes 1,021,000 barrels of foreign crude runs.
3,529,984
3,025.157
8,156,429
8,189,272
U,946,069
Tread Rubber
93.0
Aug. 12
3,034,751
3.476,034
Inventory
Aug. 12
_
3,601,590
Production
——
(Camelback)—
Shipments
(pounds)
Inventory (pounds)
'-Revised figure.
producers'
§Based
on
new
annual
capacity of 140,742,570 tons
(Based
'
39,445,000
37,884.000
41,547,000
_____
on
3,471,514
40.612.00C
30,214,000
29,549,000
the producers' quotation.
(Based
on
35,953.000
*
33,441.000
29.159,000
the average of the
and platers' quotations.
SAverage of quotation on special shares to plater.
or more but less than carload lot boxed.
{(Delivered w^re freight
from East St. Louis exceeds 0.5c.
**F.o.b. Fort Uolburne U. S. duty includecL
"ttAverage
of daily mean and bid and ask
quotation at morning session of London Metal Exchange.
^Domestic five tons
<
"
(pounds)
Production
125.6
1958, as against Jan. 1, 1957 basis of 133.459,150 tons.
tNumber of orders not reported since introduction of
if
Tn"ostrr>°"* plan.
J Prime Western Zinc sold on delivered basis at centers where freight from East St. Louis
exceeds
cne-iuui cent a pound.
96.538c
'
(Cadmium, refined (per pound)
JCadmium (per pound
$46,955,483
Aug. 12
1,
..
.
1,366.950
Aug. 12
*Revised figure.
94.665c
32.590c
Laredo___2___-
;
—
commodities
of Jan.
94.957c
____z2i
29.000c
Taxes
f
July 26
Meats
as
?
of
"Total
$00324,132
-
July 26
AD commodities other than farm
90.280c
78.125d
$2.78783
29.500C
,
1,204.429
v
July 26
S. DEPT.
88.625c
75.274c
$2.81111
29.500c
Shipments
PRICES, NEW SERIES—U.
(1947-49 = 100):
£73.745
75.000d
Total
1,298,033
1,521.088
.July 26
_
•
$2.80398
„■
price)2^_2.
S.
flask
(per
Npmber of passenger
sales—
Farm products
Processed foods
U.
10.005c
29.000c
Total
Commodity Group—
AD
icheck
Truck and Bus Tires
sales
WHOLESALE
ounce,
88.625c
ourice)i:2i-_j:i___2___.
(per
Straits:
York
(per
;
' ; ' ' :
(per ounce)l2_i:i.'r_2_2_2J
York
Exchange
of June:
1,478.058
$68,517,401
July 26
Other sales
sales
£64.652
plants
TOTAL ROUND-LOT STOCK SALES ON THE N. Y. STOCK
EXCHANGE AND ROUND-LOT STOCK TRANSACTIONS
FOR ACCOUNT OF MEMBERS
(SHARES):
Total
£64.274
New
Motor
1,905,156
July 26
.July 26
__
Round-lot purchases by dealers—
Total round-lot
10.505 c
£75.152
10.000c
$35,000
261,350
_july 16
.
sales
of
10.500c
£64.176
$254,308
1,643,800
July 26
July 26
juiy 26
Other sales
Number
10.500c
10.000c
(per long ton)_____three months (per long ton)'
13.800c
£90.614
£91.247'
,
$35,000
*
...
Dollar value
"14.000c
11.224c
£63.598
prompt
EARNINGS -CLASS I ROADS' "(ASSOCLATION OF AMERICAN RRs.)—Month.
Juiy 26
Round-lot sales by dealers—
Number of shares—Total sales.
Short
11.000c
pound)_____
long ;toif)i2i__2_il_
(per
RAILROAD
__July 26
Odd-lot purchases by dealers (customers' sales)—
Number of orders—Customers' total sales.
Customers' short sales
£219.587
$228,120
SECURITIES
;
£196.185
$35,000
.
;
26.727c
£200.582
__
£217.549
£74.153'
Bismuth
1,748,840
568,990
3,122,679
-July 26
of shares
28.690c
"
23.670c
£194.613
$230,038
438,366
,
2,815,800
843,810
-July 26
Dollar Value
24.689c.
24.397c
£199.815
76 pounds)____!_
EXCHANGE COMMISSION:
Odd-lot sales by dealers (customers'
purchases)—t
Number
ton)_
25.674c
r'
(per pound)
f*Nickel
366,560
BTOCK TRANSACTIONS FOR ODD-LOT ACCOUNT OF ODDLOT DEALERS AND SPECIALISTS ON N. Y„ STOCK
—
•}
-
£72.959
facturers'
3,213,720
-July 26
—
EXCHANGE
-.Ska -
-
Cobalt,
>
...
-
members-
—.
sales
■• *
11.024c
Magnesium ingot
sales
Short
Total
for
:
(perJong
Louis
(per
Platinum, refined
1,230,760
653,740
-July 26
transactions
384.724
54,428,374
construc¬
•'
Antimony (per pound), boxed
1,035,280
2,253,290
sales
round-lot
247.152
328.160
.
£73.277
Sterling
195.480
1,838,600
Other sales
Total
400.520
the floor-
sales
224.308
329,240
55,432,513
-
2,466,950
:
purchases
Short
286.798
31__.
SCadmium
—
sales
45,353,450
$746,672,000
London (pel* long tori)2___
(per pound)—East St. Louis______u_i
prime Western, delivered (per pound)
London
Gold
1,160,960
479,370
the floor—
Other transactions initiated off
Total
1.748,010
-July 26
on
sales
Other sales
Total
2,178,690
July 26
Total purchases
45,263,167
$776,596,000
'v 55.345,655
•
(ameri¬
months,
New
Tin,
V';
—July 26
sales
Short
44,707,315
of*!
iiAntimony,. New York boxed
Antimony (per pound), bulk Laredo__2_____
of specialists in stocks in which registered—
purchases
-July 26
—July 26
Other sales
111
■w^;*,'
_
10.800c
Quicksilver
Short sales
Other transactions initiated
"
customers—■
£71.484
prompt
Silver,
••
■
York
Silver,
'.V'J'"/. '.;92
447,215''
"
Aug. 15
7 38
126
Silver and Sterling
Exchange—" •;
MEM¬
OF
'133
v...
New
((Zinc, London,
272,100
Transactions
Total
140
London,
t(Three
BERS, EXCEPT ODD-LOT DEALERS AND SPECIALISTS:
Total
'
quotations)—
;
((London,
4.32
A;
19l';439 ''
'
Percentage of
10,963,680
113
"
London
Common, East St.
4.50
3.81
298.376
9
J.
■"
months,
((Zinc,
—
m.
■
..
Common,
ASSOCIATION:
(tons)
'■
>•
Domestic refinery (per pound)______2_
Export refinery (per pound:>____i______:.-(•(London, prompt (per long 4on)___i.z_i_2t
■
4.82
-va
,
3.96
395.8
.
•*
11.583.000
,
r
•
customers—month
"
4.35
4.32'
4.14
,
4.37
4.04
4.65
4.44
-Aug. 19
Group
Orders received
:
.Aug. 19
Aug. 19
—
Group
PAPERBOARD
4.03
-."4.71
;
MOODY'S COMMODITY
NATIONAL
>•
"230,756
RE¬
^
3.65
Aug. 19
-
-
"IIIIIIIII
91.91
.
3.10
Aug. 19
A
Group.
99.04
3.26
4.15
.
> •'
OF;
(tonnage )—«estimated______v
&
101,993
165.549
■■.■iC'
*.
1(H)—
===
variation.---1
,
'
_
Baa
97.31
,
253,463
'•>.
212,569
<000's omitjed
<e.
134.270
*';
,
~
adjustment
(tonnage)—estimated
Lead—
—
."78,631
'"'244^421
j:,'-;
bales-'ili-l'-22-22Vv'-'f
structural steel
July:
Copper—
Aug. 19
Railroad
100,296
Aug.
ultimate customers at
May
prices
3.31
...
DAILY AVERAGES:
YIELD
Aft
-
of
Shipments
,
88.81
Aaa
••
Dfel'T.
of
S A EES—FEDERAL
ultimate
Contracts closed
90.91
88.27
Average corporate
'
'u^S.
crop, as
institute of steel
tion)—Month of June:
•>.*.
96.69
Group
BOND
Government Bonds
8.
104.685
ns,978
period (tons'
COMMERCE):
can
93.08
95.47
93.97
*91,lie¬
82,076
'.'-, 107.474
bales:2'£■**• klj<
—
180.436
2,259,714
-
:_
OF
6,451,371
3,721,329,
$763,006,000
fabricated
94.56
Aug. 1.)
U.
3.886,162
pounds•
of
6,631.807
~: *35.025
•
A,—'.
)22Jriiri2_'_;__
S.
gross
May
from
86.73
'
>. .V
Aug. 19
MOODY'S
35,850
J
3,802.015
•
2,000
seasonal
of
Revenue
94.000c
95.62'
100.98
•
*3.837,040
"
month fnet tons)
EDISON ELECTRIC INSTITUTE—
Kilowatt-hour sales to ultimate
10.500c
-
93.13
93.82
97.94
Aug. 19
Group
for
1,639,000
pounds
of
STORE
seasonal
Number
Aug. 19
Industrials
500-lb.
'
3.898,240 "
'
May
Aug. 19
3.9";319,000
2,564,000
1,998,000
13.800c
24.000c
Aug. 13
Adjusted
PRICES DAILY AVERAGES:
Utilities
of
(DEPT.
(running
Without
30.480,000
410
•
—.*v>;
SYSTEM—1947-49 Average
Month of July:
14.000c
10.000c
Aug. 19
Public
2.000
(tons
A.
Production
28.075c
10.500c
10.000c
Aug. 13
-
10.500c
Aug. 13
at
corporate
Railroad
tons)
tons)
end
PRODUCTION
25.900c
,
2,620
9.774
•
t 3,862,390
AGRICULTURE—1958
$53.50
•
24.125c
Aug. 13
Government Bonds
Average
-
;v: 2,846
MIXES)—Month of May:
at
GINNING
1
179.618
8,925
*
tons
(net
of
tons
COTTON
5,967c
$66.40
-
25.025c
Aug. 13
...
Louis) at
Aluminum (primary pig. 99%) at
Straits tin (New York) at
MOODY'S BOND
(net'
tons)_"___'___l2l__2
(net
coke
S.
August
128.148
*53,355
tons)_i_^_^': -34,320,000
lignite :(net
SERVE
(East St.
U. S.
6.168c
COTTON
'222
279
/
$66.49
-Aug. 12
*——Aug. 12
Aug. 12
at
refinery
(delivered)
Zinc
-
290
copper—
Domestic
OF
(net
DEPARTMENT
Export refinery at
(New York) at
Lead (St. Louis) at
2'"
1
INSTITUTE—For month of June:
U.
310.386
60,789
'60,215
!'
copper stocks at end
of- 2,000' pounds)
12,409,000
,,
QUOTATIONS):
Lead
tZinc
12,257,000,
y&iV'X:,
PRICES:
Finished
12,707,000
DUN *
BRADSTREET, INC.
IRON
1,851,000
AuS 14
(in 000 kwh.)
FAILURES (COMMERCIAL
tons)-i--rj
Refined
EDISON ELECTRIC INSTITUTE:
Electric output
(net
(tons of 2,000 poUnds.)J2_L"^:_2^i:
Deliveries to fabricators— '•"! bjr"'7.;Mi
-'V 1
■
116,990
■
v
anthracite
coke stock
Crude
189.750
•■110.426
•
tons)i._i_J^l_^___^_^L^_'y,V
Copper production in U.
9,-588,000
509,000
-
73.055
146,179
r
tons)
\Refi11ed
INDEX—FEDERAL RESERVE
AVERAGE
anthracite
(net
27,387,000
1,370,000
411,000
9
Aug.
—-—Aug.
(tons)
85.779
252.979
.V.fvv-.*:1?■-*
'Beehive
■
and
Pennsylvania anthracite (tons)
t 54,658
(BUREAU OF MINES)—Month" '
coke
COPPER
66,967
60,187
"
"__I
(BUREAU
Oven
Ago
65.119
257,911
tons).;
'
130,371,000
'
•
America
Year
■
'
a
grades,(tons of
America
June:
Oven
■■
pounds-
Pennsylvania
(net
(net
Production
182,119,000
(U. S. BUREAU OF MINES):
coal
South
of
229,798,000
184,858,000
36,109,000
Bituminous
Asia
-Month
of
-v-;,
;
Central
i- Bituminous coal and
$411,917,000
Aug. 14
.Aug. 14
of
and
Pennsylvania
—Aug. 14
municipal
COAL OUTPUT
Europe
COKE
—
2.000
•-/•
Previous
period (tons)___jr—___
tons)
North
Undesignated
50,138,000
ENGINEERING
—
construction
Public
exports
(net
To
603,181
182,169,000
25,040,000
109,507,000
of
COAL OUTPUT
construction
Private
'■
(BUREAU OF MINES)—
of May:
■. )
To
740,471
521,832
freight loaded (number of cars)
Aug.
freight received from connections (no. of cars)—Aug.
Revenue
end
To
ASSOCIATION OF AMERICAN RAILROADS:
Revenue
S.
•
7,548,000
177,297,000
of
(tons
To
transit, in pipe linesand unfinished gasoline (bbls.) at
Aug.
(bbls.) at-—————
„
Aug.
Distillate fuel oil
at
Month
?
2,068,000
12,077.000
6,944,000
Stocks at refineries, bulk terminals, in
Finished
INC.—Month
COAL EXPORTS
'
Aug.
of that elates
are as
Month
Ago
57.3
ol
42
Residual
§1,678,000
of quotations,
cases
.
AMERICAN PETROLEUM INSTITUTE:
Crude oil and condensate output—dally
qutput (bbls.)
Kerosene output (bbls.)
Distillate fuel oil output
in
or,
either for th^
are
Latest
Equivalent to—
Steel
Dates shown in first column
that date,
on
production and other figures for th*
cover
Year
Ago
*60.5
$62.2
month available.
or
Thursday, August 21, 1958
...
J t(Increase all stocks:
Number 5770
Volume 188
The Commercial and Financial Chronicle
...
v
(743)
With S. G. Nielsen
New York islhe third state to
adopt
program
for 114
ited
R. S. Dickson Adds
(Special to The Financial Chronicle)
(Special to The Financial cnednible)
BURBANK,
guaran¬
Co.,
is be-
credit
Kutner With
ginning to play a more important choice for guarantee,
role in the financing of higher.
New York is the third state to
education.
: ^
adopt la 5student loan guaranty
low-cost
will have obtained
loans
under
self
new
a
-
!A Massachusetts Higher
program.
By the time college classes comthis Fall, hundreds of
students
from
New
York
State
Education
Assistance
Fund
has
been in operation since the fall of
bank 1956. On June 30 of this year, it
help announced it has guaranteed 2,000
initiated by bank loans for students, aggregatthe New York Higher Education teg $900,000.
In Maine a Higher
Assistance Corporation.
Education Assistance Foundation
student loan program
This
is
independent,
an
^ ^ °5Sating, f'Tv
non-
■Its
is
purpose
ed
atiail
uc
i« i
Massachusetts and Maine
promising
among
•
in
higher
foster
to
-
Th
Massachu„etts
financial
otherwise
might
reasons,
credited
:
college^
State ot
•
taking
act i
an
student
•_
; ;
.
State" banks
this
ih
nart
v e
loai?program ts The Bank
"We believe this is
of New York.
and
InlwerVttieprobtorTof
bold
a
harnes-
sing the talents of our young peo-
the New. York:
mid
Bank's
town
-
;
Robert
Scott 1 is
B.
•
Shearson,
Hammill
Via Lido.
He
Merrill
i
.
.
•J±^bXvieadInl cltizens and
°Perated llke any business under
a Program leading eventually to
o;-(^owjng, ...self-supporting loan
fund.
is
is
first bank
NewT
York
s
~
this
student
can
borrow up to $500
for his
freshman year, up to $750 in-both
Under
program
a
Pierce,
Lynch,
"
* fi
cf
f
graduation, and may normally; be
extended over a six-year period.
The interest is 4%
now
for
few months, the New York
only a
Higher
Assistance/Corporation
Education
reports that as of the-end of July,
a -total
of 126 commercial 'banks
in
communities
207
the State
throughout
student loan plan. The organization has thus far guaranteed 260
outstanding loans, totaling $141,A pickup in applications is
expected between mow .and the
456.
start of the fall semester.
Kennedy, IVlanager of
James A.
the
at
Credit
the
Fifth Avenue
two-to-one.
is
no
restriction
choice
the
on
of
college or his
field of study," Mr.-Kennedy ex¬
plained. "In our group of students
the
fields
from
of
major study
"
ferred
able
CONSOLIDATION
engineering and pure science
medicine."
New
York
State ^Requirements
rp
ofl
Q
must .be
LJS ',?
„f
M„„.
legal resident of New
York State. He must'be already in
a
attendance
tance
in
or
ers
on
must
and
-
Pacific
Stock Exchanges.
and
proof sof financial
abilty.
The
student obtains a loan application
■blank
and
scholastic
from
the
college registrar
the appropriate
submits-it to
college., official 'for
to
the
close
October
at
Stock
September 13,
25,
PAUL B. JESSUP,
as
business
on
$1.50-a share
the third quar¬
to stockholders of
business on August
1958,
P. S. du PONT, 3rd,
NNUSII
Secretary
TENNESSEE
July 22,1958
September.12, 1958, to sharehold¬
at the close of business on
Checks will be mailed.
A
^Vice-President
(55c)
Secretary
NAT I 0 K A L
August 18,1958. *£;
R A
T T f- P I F ^
cents
record
BRICCS & STRATTON
Manufacturers of
a
complete line
ness
at
61
storage batteries.
A
fBRIGCS&STRATTON).
on
?
i£
DIVIDEND
-nJ
Common Stock,
declared
by the
^lkeJlQWf
^ins'
^ach
Board
with
Directors
of
declared
has
a
September 3, 1958.
"
A.
-declared
Co. pMr. White
19,■1958
per
.
Co.
DIVIDEND
"Grant, Fontaine
A quarterly
CYAN AMID
COMPANY
ber
the Common Stodc
Company„payable Octo¬
1, 4958 to stockholders 4>f
record at the dose of business
September 2, 1958.
D.W.JACK
Secretary
dividend of38c per share
has'been declared
on
the'Common
Stock of the Company
...
K
August 15, 1958
payable
September 23, to stockholders of
•record at the close of business on
August 29, 1958.
'IrH.KTE
/ PREFERRED DIVIDEND
UNITED FRUIT
President
'.' The Board of Directors of Amer¬
ican Cyanamid 'Company today
-.declared <& quarterly dividend of
COMPANY
;,eighty*eeven -and one-half cents
(87^) per share on the outstand¬
ing shares of the ^Company's
3 V2■% Cumulative Preferred Stock,
Series D, payable October 1, 1958,
.
•
Grant,
to
the
►record
Fontaine &Co., 360 Twenty-First
holders
at
the
of such
close of
stock of
bttsiness
237th
September 2, 1958.
Street.
He was formerly, with
Stephenson, Leydecker & Co.
.COMMON DIVIDEND
ican
/With 1.1. Brooks
F'-RA N CI SCO, Calif,
C. Miller
is now
con-
nected with 1.1. Brooks Securities
Co.,
~
235
members
Montgomery
<of
the
Pacific
Cyanamid -Company
Quarterly Dividend
today
'Common
.
a
Stock
of the Company,
holders of
.Boston,
®. S. KYLE, Secretary
Industrial
New -York, August 19,11958.
record Sept.
continues
expansion
setting records, too!
12,1958.
LEONARD
Secretary and Treasurer
Mass., August 18,1958
,
EMERY IN.
2,1958.
"•
cents
share on the capital
has been
this Company
payable September 26,1958, to the
iholders - of ►such stock of-record
at the close of business September
Coast
of seventy-five
stock of
declared
payable October 15,1958, ^to shake-
per
A
Street,
Exchange. 'He was previously with Revnolds & Co.
A dividend
quarterly dividend of
>forty cents (40<> per share on
the
outstanding shares of 'the
declared
(Special' to The Financial Chronicle)
SAN
Consecutive
_
The Board of Directors of Amer¬
Charles
dividend of 40 cents
on
"MIAMI, FLORIDA
AMERICAN
Calif.—Lawrence
with
NOTKB
of - Directors today
COMPANY
(Special to The Financial Chronicle)
now
NOTICE
FLORIDA ^OWIR It LIGHT
CrAlVAMI®
Cross was Manager,
is
a
share
of the
with the Hemit office of Evans,
MacCormack & Co., of which Mr.
Cappelli
The Board
L. G. BEONER, Secretary-Treasurer.
,
(special to the financial chronicle)
OAKLAND,
•IVIDIND
H. DAGGETT
PRESIDENT
narDacn
G.
COMPANY
stockholders of record
On
Milwaukee, "Wis.
TTonlcins "Harharli
Joins
UTILITIES
August 5,1958 payable
quarterly dividend of thirty-five cents (35c)
per share and an extra dividend of twenty
c nts
Love) per snare on tne caoita!
ct
($3 par value) of the Corporation, payable
September .15, 1058 to stockliolders of rec¬
ord August 29, 1958.
August
with .Morgan
a
on
September 15,1958 to
The
Street. _Mr.
^
John G. Greenburgh
Treasurer.
New York 6, N.Y. "
REGULAR
was
.
-55
Broadway
of 50c per share
; Coast
Calif.—Allen
associated
the close -of busi'
QUARTERLY DIVIDEND
Walker .and Meade . F. White
^aYe
per
September 11,1958.
i
of automotive-and industrial
CORPORATION
of
dividend
fifty'five
-share was
declared payable September
24, 1958, to stockholders -df
John Corcoran,
.
.
ANGELES,
COftPOMMlOW
CORPORATION
'
(Special to The Financial Chronicle)
LOS
Secretary
1958.
,
'
.
on
terly interim dividend for 1958, payable
record at the close of
COAL
business
on
of
also
10, i958;
the Common
on
of
of record
Two With Paine, Webber
certification,-stock
afteiv-.which- he submits dt
25,
the
share
S7V?t a
Stock—$3.50
record
close
August 29, 1958.
the Pre¬
Series, both pay¬
1958, to stockholders
and
Board of Directors
accepted for admit¬
furnish
need
has declared this
Directors
August 28, 1956.
(Special to The Financial Chronicle)
New - York
Copper Cor¬
payable on September
the
ord >at
meeting held today, declared a quar¬
terly dividend of 30 cents per share on
the Common Stock of the Company, pay¬
With Mitchum, Jones
accredited college and
an
Directors of Kennecott
•t-a
able
of the Board Of
meeting
"
range
to home economics and
the
day regular quarterly dividends of $1.1 2Vj
a
share on the Preferred Stock—$4.50
'-V1'
The Board of Directors of
HEMET, Cal.—-Phillip B. Cross,
$9,200
have been
approved to J.-vGlen -Brubaker and James H.
date. The majority-of these loans,
Welch have become associated
'he said, are for first year students, with Hopkins, Harbach & .Co., of
with-boys outnumbering girls Los Angeles. All were previously
"'"There
August d 5, 1938
Wilmington, Del., August 18, 1958
The Board of
October
^of
Bank office,
student's
161 East 42d Street, New York, N.Y.
22, 1958, to stockholders of rec¬
of
reports that 27 loans aggregating
about
CORPORATION
declared,
Bal¬
COMPANY
COPPER
KENNECOTT
New York Stock
of the
poration held today, a cash dis¬
tribution of $1.00 per share was
OlVIDEND NOTICES
bers'
the Pacific Coast Stock
Exchange. Mr. Mann was for-;
merly with Morgan & Co.
Department
Personal
McCarley &1
Page Avenue,
35
DIVIDEND NOTICE*
joined the staff of Mid¬
Cross With
.;
FAYETTEVILLE, N. C. — Wil¬
D.. B. Riley has joined the
and Co. Inc., 120
.
participating in. the
are
with
now
Exchange.
Series
Wiley is now with Mitchum,
Jones & Templeton, 650 South
Spring Street, members of the
operation
is
Floy A.
—
land Securities Co. Inc., 1016
:
Joins Powell & Co.
(Special to The Financial Chronicle)
At
.KANSAS CITY, Mo.
.
(Special to The Financial Chronicle)
CHARLOTTE, N. C. — Melvin
Shapiro has been added to the
staff of Morrison & Co., Liberty
ife Building.
DIVIDEND NOTICCr
E.I.DU PONT DE NEMOURS & COMPANY
timore.
Morrison Adds to Staff
W.I
Joins Midland Securities
Rowe has
Company
~nc., Wachovia Bank Building.
(Special to The Financial Chronicle)
Smith,
&
tile
staff of R. S. Dickson &
Anderson Street.
With McCarley & Co.
Merrill
with
Fenner
pmimvl'v^nia Jersey' Indiana
and up
Monthly repayment of
capital begins three months after
J in
Boatmen's
1003 Walnut Street.
1S r?~
^ consideration in
v
$1,000 in his fourth and grad-
uate years.
.
.
WilliWm
staff of Powell
members
LOS ANGELES, Cal.—J. George
his second and third years,
to
now
—
added -to
been
liam
Company, Inc.,
CITY, Mo.—Robert A.
KANSAS
has
Coxe
D.
James
—
Bank Building.
Moran
Kroenert
Mo.
ASHVILLE, N. C.—Edward
•
J**"** legislation for similar
' "An
Voffices.
lIT^ewWmk
1784
& Co., 3363
formerly with
,
LOUIS,
with
now
Lynch, Pierce, Fenner &
weIt SeveX'street
hi
was
—
CHARLOTTE, N. C.
.
'
'
(Special to The Financial Chronicle)
of Dean Witter & Co.,
Calif.
With Merrill Lynch
Higher Education
.
foundeil
BEACH,
of
number
Joins Dean Witter & Co.
Veron has been added to the staff
(Special to The Financial Chronicle)
NEWPORT
ofs
associated
IWith Shearson, Hammill
students in
Pennsylvania.
the upper half of their high school.;:-.
i: L
:
graduating classes do not go - to.' VJoins Holton, 'Hull
college.
This program offers an
(special to The financial chronicle)
opportunity for
the ambitious
LOS ANGELES, Calif. —Kenstudent to develop his best talent
n
..
D
Mann h ' hL0'
assoin the approved college and.pro-;
cja^e(j' with Holton
Hull & Co
gram he judges best, and to pay 210
memalarming
afifliated with
now
men's Bank Building, members
ST.
theseveral states, including Connect-
of
charee
In
lim
Assistance Corporation is admin-
pie,'1 stales Joseph A. Hannan, Jr.,
Vire-President
are
(Special to The Financial Chronicle)
542o,uuy.
Among New1 York
become
Hill, Richards & Co., 621
South Spring Street, members of
the Pacific Coast Stock Exchange.
is,limited to 80% of the
York Is First Bank
Bank of New
College
^la|ear.In both plans
hlited to 80% of the
guaranty loan plan, the organizaby. the
has
with
Smith.
,
operate the
To
of
Wolfe
the New York and Midwest Stock
Majnp
,
E.
Mo.—John W. "Car¬
William A. Gerst and Harold-
man,
Calif.—Henry Exchanges.
ANGELES,
Kutner
I guarantee
fourth years
..
.
Hill, Richards
(Special to The Financial Chronicle)
and
guaranty to a bank loan for
student
accepted
by an
ac-
100%
aos
fPn"
1^
ing beyond the high school level.
accomplishes this by giving- a
It
a
anri
h
,™te
school-
their
continue
not
ST. LOUIS,
W.
Nielsen
G.
V (Special to The Financial Chronicle)
)
5"s a™ Meil?.e
students of New York State who,
for
°J
3S °f
guaranteed 16 loans totaling $7,067.
profit organization: created by the
1957 New York State Legislature,
Glen
—
Fusz-Schmelzle & Co., Inc., Boat-i
NYHEAC through the bank of his
mence
Calif.
with W.
now
362 East Olive Street.
He
formerly with J. Logan & Co.
was
-
Commercial bank
is
Duke
Bank of New York is New York's first bank
to participate.
"
colleges.
Three With Fusz-Schmelzle
(Special to The Financial Chronicle)
teeing commercial bank loans to students accepted by accred¬
143
*
«
The Commercial and Financial Chronicle
Thursday, August 21,1958
.
(744)
44
BUSINESS BUZZ
on...
BeTund-the-Scene Interpretation!
/f fl/f
.from the Nation's Capital
WASHINGTON. D. C.—There
of
Public Roads that shows that
road construction is one of the
is
Bureau
the
at
chart
a
bargains of the day. The price
highway con¬
struction decreased 2% the first
index shows that
1958
of
quarter
compared
as
quarter of 1957,
and that the cost of the second
quarter of this year rose only
B/lOths of 1% above the first
However, the increase
prices is expected to be
the forerunner of higher prices
in various materials that go into
quarter.
in steel
Regardless of the costs, how¬
ever,
the highway building pro¬
gram
in the United States is
accelerated.
Practically
lieing
increase its
during the
More than a dozen
will
state
every
work
-construction
coming year.
double
dollar
their
will
ex¬
will
penditures,
and
several
triple their dollar outlay,
Officials
highway, has
been going on at a stepped up
pace for the past two years, and
things- have
begun to hum
the price
•of
a
Nation.
the
across
of
in
barrels
3,267 miles of the multi-laned
Interstate Highway System in
this country
at an estimated
cost of SI.8 billion.
Construc¬
tion contracts have been com¬
y
when
pleted since July 1, 1956.
the
vast
was
program
inaugu¬
1.771 miles at a cost
About $1.5 bil¬
rated, on
of $439 million.
been spent
preliminary
lion additionally has
authorized
or
engineering
acquisition.
is
rights-of-way
that
important
highly
tthe Federal aid highway funds
allocated
be
far in advance
as
possible in order to help the
Stales properly plan their work
schedules. For that reason the
as
.
nounced
few weeks
a
"I960 fiscal year
$3.4
•million
($2.5
funds
Interstate and
for
for
the
totaling
funds,
The
billion.
billion
an¬
ago
apportionments
Federal
all
of
Roads
Public
of
Bureau
ABC
continued
has
to
$900
roads)
it
is apparent
that the
tremendous
program
the re¬
mainder of this fiscal year and
next year will have a favor¬
able impact
on
the highway
materials industries.
;
\ : ■
000
T h
dent
e
Vice-Presi¬
Executive
the
of
American
Road
Building Association. Louis W.
Prentiss, declares that the high¬
way
industry,
branches
as
including
the
and by
1960 or
capacity of the indus¬
ment
either a ce¬
way1 construction program
world has ever known.
On
other
there
hand,
the
cement
the
of
costs
pro-
ducers of materials and services.
*
and contractors ha ve expanded
their facilities to meet the re¬
quirements
Program.
of
the
Interstate
He declares that the
industry
places
program
of construction
its
trust
in
a
activ¬
ity that will continue, without
interruption, at
a
big level for
another 10 years.
terms
of
'i.
obligated
days.
incidents.
they
do
not
more
money
engineering
research
Underway today in¬
volving cement, concrete, clay
is
more
ing materials
history. As a
says
ments
There is also
fit to many
to
about
Practically all of the states
some type of highly tech¬
nical research projects under¬
way to determine the strength
of the concretes. Other projects
materials
road
concrete
highway
stance,
funds,
governments.
who
Means
and
Ways
something
do
to
charges
providing for what they
MBA
concerned
home
who
have
for
in¬
the
ments continue to make
financed
an
excel¬
lent record of keeping their mort¬
gage
the
"skid resistance" surfaces.
loans
current, according to
mortgage delin¬
national
quency
Heavy Use of Lime
survey conducted by
GI repayment record.
Shipping
compiled
survey
Mortgage
by
the
Bankers Association of
survey.
necticut
TJ.
America. For the first six months
those
ended June 30, 1958, GI home loan
sured
lime
major
such
users
as
other
the
steel, pulp
chemicals,
paper.,
plaster
highway
officials
say
quencies
that the
Therefore, officials say there
evidence there will be in¬
creased utilization of lime as an
rrenus.
greatest future use
1%
higher
.
General
of
and
just beginning to be recognized
and appreciated.
.
additive.
.42
2.06%for
The
value of lime for stabilization is
the
;
glass, but increased use of
lime is already under way.
Bureau
of Public
Roads
is
r.
<
for
one
• are
months
two
only
the
declining
the
fractionally
time a
year ago, and can be considered
an excellent
showing in view of
than, at
of
the three months
or
.27
1.43%
business period
for
one
For
delinquency report covered
.25
of
or
1%
more
for
Relations:
m o r
t-
three
of
totaled .16 of 1%,
two
months
The
Years—Edited
—
by Dr.
Michigan State
of
Currency of Account in
a
International
Collin
—
Loans
—
International
Fernand
Institute
for
.
Banking Studies, Secretariat
General, 119 Coolsingel, Rot¬
terdam,
The
Netherlands
(paper).
You and Your Bank
delinquencies
gages,
months
2,497,554 loans and total nation-
month.
conventional-type
is
(Your Bank
Financial Department Store)
Channing L. Bete Co., Inc.,
Greenfield, Mass. (paper); 250*.
a
—
and
only .99 of 1% for one month.
TRADING MARKETS
sajs
American Cement
of lime
lies in
in the highway program
the
Use
more,
for two months and
1%
Stieber
^
same
which they cover.
The
for
20
Mich.
the
Housing Administration
and mortgage field totaled .13 of 1%
month. These delin¬
Industrial
Jack
guaranteed nor in¬
by a Federal agency.
Delinquencies reported in
Washington
University Press, East Lansing,
delinquencies of three months or
more only amounted to .34 of 1%,
Federal
of
any
neither
S.
Next
loans,
conventional-type
Avenue,
6, D. C.
this year, 45 % were GI loans, 35%
were
FHA mortgages
and 20%
were
Discussing
—
shipping—Committee of Amer¬
ican Steamship Lines, 1000 Con¬
54,798, or 2.19%* A year ago
delinquencies were 49,580, or
2.02%,
based
upon
a
total
of
total
loans reporting in the
Of the total on June 30
Outlook
economic role of American Flag
as
2,446,931
6669—Superintend¬
Documents, U. S. Gov¬
ernment Printing Office, Wash¬
ington 25, D. C. (paper); 250.
■wide delinquencies were reported
Highway construction still
provides a smaller market • for
than;
Department of State
—
of
ent
delinquency
purchases over the years
relatively small down-pay¬
over
of pavement slipperiand are making progress
ness,
Veterans
Expense RatiosInsurance
Paid Vacation Provisions in Major
Repayment Record
bankers to praise excellent
cause
with
departments,
are
,,
Some
highways.
and
York
Depart¬
ment, 324 State Street, Albany
10, N. Y. (paper).
their,
from
Loss
New
on
[This column is intended to re¬
Union Contracts, 1957 — U. S.
flect the "behind the scene" inter¬
Department of Labor, Bureau of
pretation from the nation's Capital
Labor Statistics, 341 Ninth Ave¬
and may or may not coincide with
nue, New York 1, N. Y.—300.
the "Chronicle's" owns views.]
Role of the United States in World
appealed
Results of national mortgage
treated
Botany Mills
secondary road system.
Of
the
3,400,000
miles of
roads,
streets
and
highways
in
the
Wurlitzer Co. Com.
United States 750,000 miles are
Indian Head Mills
in
Federal
the
two-thirds
of
aid
this
system
up
the
sec¬
of
thousands
called
so
not
in
of
Carl Marks & Co. Inc.
Federal
aid
FOREIGN SECURITIES SPECIALISTS
20 BROAD STREET
TEL: HANOVER 2-0050
Leasing Equipment
-
highway
leasing their
more
retired
tractors
are
the mil¬
chinery
in their road
National Co.
Corp.
•
NEW YORK 5, N. Y,
TELETYPE NY 1-971
LERNER & GO.
Investment Securities
con¬
10 Post Office
Square, Boston 9, Mass.
Telephone
TT
Mbre and
•
Morgan Engineering
Cormac Photocopy
miles
farm-to-market
the
Park
United States Envelope
or
ondary system. In addition most
have
Fashion
and
mileage,
system.
to the plateau is
reflected in the annual step-up
4in fund obligations by the Fed¬
Prentiss,
House
leasing
1957
deduct
to
7, N. Y.—Details
from publisher.
request
equipment dealers.
num¬
Excellent Gl Loan
problem
The approach
several years ago from
all
derwriters Corp., 253 Broadway,
New York
How¬
government
contractors
(7th postwar Edition) —
Foreign Credit Un¬
American
scheduled
unfair.
Federal
the
ever,
permits
Area
the
that
for
roads
State
is outmoded and
1958 Market Guide for the Pacific
-
Publication
applying resinous
materials for surfacing cement
niques
S. De-
of
(in two parts)—New York
University, 6 Washington
Square, North, New York 3,
N. Y. (paper).
Affairs
with lime, development of tech¬
be maintained for several years.
and
the
Committee
insist
depreciation
present
certain tax bene¬
a
contractors. A
of equipment.
Contractors
have to borrow
from their bank¬
ber of contractors have
underway.
states
eral
In this manner
machinery and equip¬
ment before making a purchase.
various highway depart¬
have continuing projects
include
Winter 1957-58—U.
Israel
depre¬
equitable
more
a
ciation
try out
substantially
of Roads
be
call
sizable proj¬
Many contractors also like to
Bureau
The
better.
no
than anytime in
result roads of the
should
future
a
Leasing requires little or
downpayment.
ers.
build¬
and lime and other road
the program is rising right now
toward the plateau that should
General
undertake
tal to
ect these
There
Pension
New York University Program in
to
It takes substantial capi¬
work.
may
evoke some headaches in some
500,000 miles make
In
a
the
where high transporta¬
cidents
letter
MacRag Paper Company—'Roses
red, Violets are blue, Your paper is lousy, We're
going to sue'!"
"Take
are
be in¬
may
,
Selected
Labor, Bureau of
Labor Statistics, 341 Ninth Ave¬
nue, New York 1, N. Y.—450.
in the greatest high¬
problem
100
of
partment
procurement
steel
or
nomic
Plans Under Collective Bargain¬
in the
is nothing
a Growing
Committee for Eco-
.
Therefore, as far as the Bu¬
reau
of Public Roads
is con¬
there
Inflation: Policies
—
ing,
picture indicating
Avenue,
500.
Stability in
Digest
approximately 400,-
try will be
Fifth
—
De¬
Development, 711 Fifth
Avenue, New York 22, N. Y,
"(paper)); $1.
\
•
.
000,000 barrels.
such
manufacturers,
Houser
711
Economy
-
barrels,
1961
and
V.
Economic
for Price
it had climbed to
and
T.
for
Defense Against
"
Thus
—
New York 22, N. Y. (paper);
of ce¬
climb.
were
largest ever advocated in
the history of road building in
the World.
: '
the
.
Committee
barrels.
By
380,000,-
311,000,000
1957
in
in two volumes _•—
Century
Fund,
41
Street, New York 21,
70th
Cruelest Tax
to
by
By the end of 1955 the annual
capacity of the industry was
about
-•■
N.
N. Y.—$10.
1961.
Meantime, the capacity
■*;
Simon
—
velopment,
110.000.000
about
and
—
Twentieth
have
Fund Allocation
Advance
It
for
and
will rise
barrels
1955,
,j:V;CV.
Policies
Trust
East
Statistics, 341
New York 1,
Avenue,
Y.—300.
Whitney
Commerce
the
Department believe that cement
requirements
for
highways,
which
were
about
60,000.000
tion
Construction Is under way on
Ninth
Requirements
at
Labor
of
Labor,
of
Department
Bureau
Anti
Huge Cement
S.
—U.
N.
cerned.
Engineering and obtaining of
rights-of-way by the various
states, which
cost about 25%
<
Analysis of Work Stoppages, 1957
decade.
ment
the road building program.
JL
W\A/
m
itary service, maintains that if
the program is to be completed
on schedule, it will be necessary
that the stepped-up tempo be
maintained for at least the next
the last
with
V
jlJL
Teletype
HUbbard 2-1990
BS 69
....
ma¬
building
,
@FedFRASER