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ESTABLISHED 1S39
Volume 174
Number 5036
New
York, N. Y., Thursday, August 9, 1951
Price 40 Cents
Copy
a
EDITORIAL
As
We See It
Perhaps more than some of the other instances
in the
long list of "scandals" coming to light in
recent years, the
shocking breaches of honor now
revealed to have been
taking place in the United
States Military Academy at West Point have
given
deep concern to thoughtful people throughout the
land.
What appears to be a definite
that the practices with which a
very
number of cadets have been
more
widespread
over a
certainly does nothing to
intelligent people.
of
even
and
let
the
matter
rest
often rather sickened
we
at
have resorted to
My effort shall be to examine the
;
the
nation's
moral
crisis
we
far-reaching implications.
the
hands of the clock back is often at
little but an attempt to excuse
In
of
import
nation
.at
connection
.to
for
wrong
places
E.
of
your
acquaintance
participation
in
around
is for
them
the
Others have become
with
wholly
honor, no
men
the
with
in
stocks
Hell
to
mine,
Continued
on
page
by
consider
outbreak of
war
reason
today
beneath their
immersed in the day
Mr.
to
the
in
values
extra
our
which
total
World
Wars
at
only a minor
global rearmament
compare in scope
efforts
I
and
in
made
we
II.
Contradictory Precedents
Having
greatest
„
and
two
current
as
rearmament should be well
understood and their reactions upon
the stock market pretty well indi¬
..
of
cated
the
by
of
However convenient this line
reasoning
shows
dignity.
market
almost
were
'
'
'
V-V
may
that the
•
•
be,
opposed
• -
<
by Mr. FitzGerald
Conference, Graduate
School
of
Palo Alto, Calif., July 25, 1951.
at
the
stock
during the
on
page
28
address
record
'
-
Continued
•
the
actions of the
diametrically
" -t/.v'"
;
the precedents set during
of those two great con¬
course
flicts.
Philip J. FitzGerald
on
for
the
won
in the past generation,
might seem reasonable to expect
that the investment problems of the
.
that
page
fought
wars
it
has
go
Institute
offer
that
incident
to-day duties
on
much longer
over
recession in business, and
objectives,
;
-
spread
.
in Korea that conflict is
points
This
which
Young before the Summer
Social Progress, Wellesley, Mass., July
12, 1951.
28
industries
great
activities
its
some
are
responsibilities,
the
privileges,
our
situation.
Looks for possible cutback in
or
a
the
market
i In considering the
problem -of rearmament it must be
recognized that while the program was sparked by the
♦An
addrets
of
a
Continued
♦An
bring
may
country.
and women, all too many,
political
some
so
in
general observation.
and
not inflated.
rearmament
%%*;
said, * a
issue, I should like to make.one
Many
of
period
maintain their neu--
proceeding
citizenship
Young
'
coun-
.
contrasted
Ben
scope
T<
those who, in
stock
of
<
crisis,
Before
do
are
we may
Dante
and postwar periods, Mr.
war
present
this time.
study'
and
care
ago:
moral
other
concerned upon which our civiliza¬
tion itself has been erected the situation is
,
income, and general level of business, stock
prices
lists
called '»
is
we
answers.'
trality."
;
analyzes
period that
promoting
human
our
hottest
reserved
are
code of
deep
right
this
"The
a
good many things this sort of reasoning
enough, but when fundamental canons of
no
of
to face requires that
long time
are
About
If there is to be
The
reach the
fundamentally unwise policies or practices by
saying that they are in keeping with the times.
different.
hope
hope that
or
behavior
the
prices during
national
.
problem of
grave
stock
FitzGerald
coin-clipping.
them with the utmost
sel together in the
bottom
basically
of
discussion warranted by its
questions
upon
by something fairly akin to
the
with
the serious and worthwhile
this attitude applied to
many current ideas and
practices, some of them involving more than trivi¬
alities. The common retort that we can not turn
is well
modern version of
a
nos et mutamur
Indeed
Members, New York Stock Exchange
Finds, in comparison with increased production, higher
change with them)
that.
1
oration, people should unite for its preservation. Attacks
people generally.
mutantur,
change and
Partner, Dean Witter & Co., San Francisco, Calif.
After pointing out contradictory precedents in behavior
we
shameful
Economy
today, points out its impact on our tradition¬
al way of life. Says U. S. has been forced into world
leadership and, though free enterprise system is threat¬
ened by inroads of
socialism, moral and political deteri¬
There are, of course, those who would
quote the
Latin proverb
"tempora
in illis" (times
of Detroit
Keynesian "Compensatory Economy" and "Managed
Money." Says through issue of unredeemable currency,
though it be in its own right, is seriously dis¬
turbing chiefly because it comes as the latest in
a
long list of symptoms of an apparent degener¬
ation in the moral fibre of the
Vice-President, National Bank
the minds
.
a
By PHILIP J. FITZGERALD *
in the world
much longer
ease
But this matter, unfortunate and
Rearmament
Detroit banker, in discussing the moral and
political crisis
period than is indicated in official action thus far
taken
To Our Way oi Liie
General
have
may
Investing Under
By BENJAMIN E. YOUNG*
possibility
substantial
charged
been much
TheWoild Crisis-Challenge
10th
Business,
Stanford
Stanford
22
Business
University.
GOING TO NSTA
curity
Boston & Maine R. R.
Traders
CONVENTION?—This year's Annual Convention of the National Se¬
be held at Coronado Beach, Calif., from Sept. 30
to Oct. 4.
For further details see "NSTA Notes" on
page 8.
Association, Inc., will
State and
Prior Pfd.
Boston & Maine R. R.
A, B, C, D, Pfds.
R. H. lohnson & Co.
STATE
Established 1927
600 Branches
across
BONDS
B o ught—Sold—Quoted
INVESTMENT
Municipal
MUNICIPAL
AND
.
SECURITIES
Bonds
Members New York
31
&
Boston
Stock Exchs.
MILK STREET, BOSTON 9, MASS.
Tel. HAncock 6-8200
120
Tele. BS 424
BROADWAY, NEW YORK 5, N. Y.
Tel. WOrth 2-0115
Tele. NY 1-315
64 Wall
Street, New York 5
BOSTON
Troy
THE NATIONAL CITY BANK
PHILADELPHIA
Albany
Buffalo
Harrisburg
Providence
of Commerce
Head Oftice: Toronto
Williamsport
Washington, D. C.
Allentown
Bond
Dept. Teletype: NY 1-708
New York
Seattle
me
Husky Oil & Refining
OF
Hawaiian Securities
Direct Private
BOSTON
Great Plains
or
Wires
VANCE, SANDERS & CO.
and,
Chicago
Angeles
Co.
Street, New York, N. Y.
Members of
BOSTON
Los
14 Wall
&
•
Los
•
Angeles
Honolulu
•
OF
THE CITY OF NEW YORK
Agency: 20 Exchange PI.
Portland, Ore. San Francisco Los Angeles
CANADIAN
Central Vermont
BONOS & STOCKS
Public Service Co.
COMMON
Analysis
Goodbody
&
Co.
DoMimoTi Securities
Grporatkki,
MEMBERS NEW YORK STOCK EXCH,
Chicago
115
40 Exchange Place,
BROADWAY
'
Boston
NATIONAL BANK
NEW YORK
upon
request
DEPARTMENT
Principal Commodity
Security Exchanges
San Francisco
THE CHASE
(Western), Ltd.
ESTABLISHED 1891
Ill Devonshire Street
New York
Dean Witter
Development Co.
Dome Exploration
CANADIAN
Prospectus from authorized dealers
Department
Steep Rock Iron Mines
Pacific Coast &
Bond Fund
Bond
The Canadian Bank
OF NEW YORK
Scranton
Wilkes-Barre
*
Monthly Commercial Letter
upon request
duPont, Homsey & Co.
i
Canada
New York 5, N.Y.
105 W. ADAMS ST.
CHICAGO
IRA HAUPT & CO.
Members New York Stock Exchange
and other Principal Exchanges
111 Broadway, N. Y. S
WOrth 4-6000
Teletype NY 1-702-3
WHlteball 4-8161
Boston
Teletype NY l>-270t
Telephone i Enterprise 1820
The Commercial and
Financial Chronicle
.
Thursday, August 9, 1951
..
(502)
2
j
('
'
V
i n
The
TRADING
MARKETS IN
L.
t
f
j '
(
"
,
Hajoca Corporation
1:
York 5
120 Broadway, New
"fur
income bond."
So
far
Income
r
Since 1917
I
as
recall, the
can
or
i
t
n
n
n
gent
interest
hnnH
annprirpd
frflC pONNELL & CO.
'
Members
120
New
York
New
York
Stock Exchange
Curb Exchange
BROADWAY, NEW YORK 5
Tel.
2-7815
REctor
,'
,
Trading Markets
paid
Handley Hardware Co.
First
in
dates
Sltl0n of t e General Mortgage
41/2S which are now selling at the
of bonds bearing
use
low point of the year.
limited
with
interest
\
~
the capital structure of Erie at three important
compare
the recent
past:
Erie
Erie
'f I
Scott, Horner &.
Mason, Inc.
,
LD 33
20,183,000
R.F.C.
Due
bankruptcy it had annual fixed charges
of $14,551,610,
one-half that
Quoted
request
sum
Interest
on
Interest
on
Interest
on
Rentals
of
Interest
on
unfunded debt
Contingent
Telephone BOwling Green 9-5920
Total
discount____
in
the
no
years
reorganization, a saving accomplished through refunding at lower
cost and debt retirement. ;
'
AUDIO DEVICES
The outstanding debt, other than
equipment obligations, matures in
moderate amounts
Participation
riod.
will
growth company
and
npriir
until
General
The
of
about
copy
of
the
remarkable
'
charges
ance
sheet and earnings
With
the
a
Nassau Street,
N. Y.
5
.
Tele.: NY 1-2078
a
of their funds in
security, to
say
:
year
„
refining company
and Refining
for
approximately
are
noncaliable,
greater interest rate than
average
on
He immediately - took
management
of the
Kingwood
company,-becoming its
over
1950, while
Asa Lee, who had been with the
company for over
30 years, as¬
sumed chairmanship of the Board.
.
in
for
this
June 29 at 72.39.
Breiul
Mr.
found
Gersten & Fkenkel
N.
Members
tools to carry out
dollars
two
.
.
,
.
to
■
.
is
terest
,
,
amply
t
.
.
covered
,
and
the
'.
*
are traded on an and mterest" basis. It is one of the group
so-called
Income
Bonds
that
has suffered a sharp decline and is
entitled to
Erie
any
oil
a generous recovery.
may
not be favored with
strike
near
its
line
but
"gold"
will
chaser
of
accrue
its
to
General
Bonds at current levels.
the
its own drilling
lease such facil¬
ities when not employed in com¬
pany operations.
*
This date, March 1, 1950, marks
an important point
in the affairs
and
New York 7
Tel. NY 1-1932
Tel. DIgby 9-1550
•
WASHINGTON & OREGON
SECURITIES
•
General America Corp.
•
Puget Sound Pwr.
•
Wheeler Osgood
& Lt.'
BOUGHT
SOLD
•
QUOTED
•
foster & marshall
Member New York Stock Exchange
SEATTLE
4
Portland, Spokane, Eugene
Mu.
1900
Tele.
SE 482-483
MEMBERS
MIDWEST STOCK
EXCHANGE
Stix & Co.
509 OLIVE
STREET
St. Louis 1,Mo.
,
'
Kingwood.
Operating econ¬
were effected through cen¬
costs of oil
lifting
over
it
management
of
tralization
14%.
was
It
was
to
cheaper
tractors to do the
ing instead of
hundred
reduced
that
found
engage
cpn-
moving tools several
with high trans¬
costs,
were
so
drilling
the
sold, releasing
Quotation Services
for 38 Years
National Quotation Bureai
Incorporated
capital
for other uses.
The company
Over-the-Counter
company's drill¬
miles
portation
tools
were
and
acquired substan-
Continued
on
page
26
'
Established 1913
46 Front Street
pur-
Mortgage
Security Dealers Assn.
Y.
150 Broadway
drilling
production, together with
operations
add
"A"
Series
the company
excellent
able for dividends, the anticipated
will
1946
6s
President on March 1,
dollar added to the amount avail-
there are almost certain signs that
*
occurred
the
$7,000,000.
omics
and by an
Georgia & Florida R.R.
Ashland Oil
.
increase
& Film "A"
in
Company
of
charge ahead
Aniline
General
Kingwood Oil Company, a
financial condition,
pext few weeks and based on past with about $1,000,000 for net work¬
capital
and, approximately
experience it will probably favor ing
,
...
„
600,000 barrels per annum of oil
the Eastern trunk lines- For every
Rights
Cone Mills
portion
of
the
10 points below the 1951 high. In-
protected
exception of Chicago
stock
in the
&
Common
t i ons.
type
of the
is hoped that the I.C.C. will
grant a rise in freight rates
•.
Rochester Gas & Electric
fso-
protection
provid-ed
neroert E. Gree.ie •
against
the
depreciation of the purchasing
power of the dollar, many openend mutual funds have placed the
^rie General Mortgage 414s are
The low point in the Dow Jones
railroad
has risen to above 80 and as.usual
s,ee1m?"e imprfss.lve. Sa2ns
the stocks than in the junior bonds.
of
32/4%.
averaged
BS 259
WOrth 4-5000
Telephone
Y.
Realizing Uhe
selling near this year's low and
underlying bond of the Erie
bears
PETER MORGAN & CO.
fixed and
has
,
Mass.
Teletype
:
growth
u a
4*%
$72,000,000.
bal¬
statement
no
31
si t
current yield
market value of
and Erie 5s which
Tel.: DIgby 9-3430
a
income
a
1950
through
1942
the amount available for interest.
•
while
6.20%
having
history
of this company, its favorable
In
equity in common and preferred
stocks
a
amount
1952.
Mortgage
bonds at 72 afford
of all taxes on
REQUEST
15,
1 Qfid
by ample earnings,
ON
equal
an
March
issue
an
ritips:
.
YOU
pe-
of, $1,375,000 2%
bonds mature and no other matu-
manufacturing products in great demand
AUDIODISCS
15
mature
1953
RECORDING
long
over a
This year $500,000 was paid
March
Earnings of a Well-Managed
SENT
these
of
called
to
-
57,713
In less than a month the average
charges today are about
$2 million less than at the time of
BE
more
$7,263,499'
V
less
year
Total
TO
of
^or
$5,150,409
2,113,090
117,128
v
charges
fixed and contingent
interest
$17,500,000 and in
than $11 % million
TAPE AND
shares
one
progress was
351,907
The amount of net income available for the payment of
-
the
1914, ' no important
made until the con¬
trolling interest of Kingwood was
acquired in the early 1940s by
James F. Breiul. At that time he
also held a 60% interest in the
Frontier Refining Corporation of
Buffalo.
In February,v 1950, Mr.
•
interest
contingent
MAGNETIC
of
7-0425
CA.
N.
Breiul sold the
Teletype NY 1-3018
in the
inclusion
St., Boston 9,
State
148
the
without
ganized
084,758
equipment obligations
leased road and equipment
of debt
THERMO CONTROL
Information on request
Tel.
balanced
well
Although this company was or¬
34,461
collateral notes-
fixed
Total
St,, New York 4
affords the Investor a
is
red
e
acreage.
Incorporated
Broad
sid
c o n
$3,904,442
mortgage bonds
-
V
sum
and at the close of 1950 on an annual basis were:
Amortization
JAMES J. LEFF & CO.
a
Mobile, Ala.
wires to our branch offices
No
i
portfolio
in the period before 1938.
in good years
earn
4% Debentures
50
e s.
which it had been able to' progressive oil producer with es¬
tablished and profitable produc¬
"
Today the total charges for interest and rentals are less than tion and substantial undeveloped
including rentals
Graham Paige
on
$203,743,083
$201,338,925
$286,308,825
NY 1-1557
THERMO KING RY.
been
individuals in the
higher tax brackets who are al¬
most
compelled
to "'pursue
the
same policy.
An outstanding se¬
curity falling into this category,
and
one
which should not be
overlooked, is the capital stock
38,758.333
-
.
New York 4, N. Y.
HAnover 2-0700
invest¬
stocks
nothing of those
1,000,000
21,350,000
i
p a n
major
2,180,125
others
to
25 Broad St.,
Com-
Growth
this
'
21,350,000
Equipments
When the Erie entered
Circular
47,537,750
,14,000,000
Total debt
—
$117,447,000
52,642,425
Notes
<ifilllllllllllllllilIIIIIIIIIIJIIIIIIIIIIIII
Sold
$113,346,500
Contingent interest debt
Due
Prosperous
Dec., 1950
Dec., 1941
Dec., 1937
$242,595,700
Fixed interest debt
Lynchburg, Va.
—
Reorganized
Erie Failed
i
York Stock Exchange
York Curb Exchange
termed.
to examine the po-
,
New
popularly
^ win pay us
...
common
corporations which have
of
gage
amended
towards
certain
in
ments
marked the closing weeks of July/
the
Members
New Orleans, La. - Birmingham, Ala.
trend
definite
a
-
■
foreclosure to mortbond holders, it was not un-
contingent
Bought
regu-
the right of
to adopt
Tele. LY 83
(Page 26)
ferred stock. Dividends were first
nrnvpH
tn
Hp
W
declared on the common stock in
sound
and
July' 1942' and at least $1 per
since ' the
■HflJBHH share has been paid thereon jn
adoption
of
'
/V every year» the PaYments in 1950
Section 77 of
Hubert F. Atwater
totaled $1.75. .
v ^
the
Ban k
With the activity and advancing
ruptcy Act practically precluded market in Erie common that has
cedures under the Act as
Dan River Mills
Moore
Interest has been
natural for the reorganization pro-
American Furniture Co.
President, G. A. Saxton
Co., Inc., New York City.
&
mort-
theory
-
'tisEiiiiiiiiiiiiiiiiiiiiiniiiiiiiiuiiiiiii'
Members New
,|| April 1 since issuance and for that
matter $5 per share has been paid
regularly on the series A *pre-
Sante
i«q<s_Qfi
in
The
Steiner,Rouse&Co.
Industries—Carl
Oil
Stolle,
m larly at .4^%'annually om each
nrpani7atinn
the
&
City. (Page 2)
Kerr-McGee
is
bond with contingent interest
U
■m
KtheTe- i v
of
Coburn
York
Unlike its prototype, the AdDirect
justment 4s of the Santa Fe,
HERBERT E. GREENE
whicll can pay interest only if
^H earned> Erie 4may receive Resident Manager, Coburn & Middle- J
brook, New York City
+tbeir *u£ ^eref a* the d*f?eHIM tion of the board and unpaid mU. S.
';ll terest, if any, may accumulate to Kingwood Oil Company
ML T1 !■ 13'/2% at any one time.
; . ! lip recent years there has been
"art
of
Company—Herbert
Resident Manager,
Middlebrook, New
Greene,
animal"
by the classifica-
bearing
-
tion
Rights & Scrip
Bought—Sold—Quoted
E.
_
^
found in Erie RR. general
unfortu- Sage 42/2S, 2015.
nately damned
Specialists in
&
example of a welljunior lien convertible
secured
Today one's favorite investment
often found in that species of
is
^
notable
A
4'/2s, 2015
Erie R. R. Gen. Mtge.
Teletype NY 1-583
BArclay 7-5660
or none.
Members, New York Stock Exchange
Established 1920
Gammack
Co., New York City, (page 2)
Kingwood Oil
accumulation
stocks with limited
Louisiana Securities
4i/2s of 2015
—Hubert F. Atwater,
accumulations as well as preferred
HUBERT F. ATWATER
Gammack & Co., New York City
Corporation
Erie R. R. Gen. Mtge.
particular security.
are
Hanseatic
New York
a
(The articles contained in this forum are not intended to be, nor
they to be regarded, as an offer to sell the securities discussed.)
^
Ridge Mutual Fund, Inc.
Blue
a
for favoring
participate and give their reasons
Corp.
Thermit
&
Metal
in the investment
Alabama &
Participants and
Their Selections
Forum
different group of experts
and advisory field from all sections of the country
each week,
A continuous forum in which,
Corporation
.V Polaroid
Week's
This
Security I Like Best
CHICAGO
- - -
New York 4, N. Y.
SAN FRANCISCO
Volume 174
"Number 5036
The Commercial and Financial Chronicle
.
(503)
Chemicals- For Growth
INDEX
LlCHTfnSTEIfl
"
Earnings and Net Profits
Articles and News
v
'
3
Page
AMD COMPANY
By IRA U. COBLEIGH
!')
I
i
"How
Current
>
The
word
from
shares.
word
meaning
'"pouring"; and whether
about
you
talk
laboratory research, produc¬
tion
f i
o r
ing" is still
decade, such fantastic growth that
phase,
sales
1950;
word
in
ical
„
I States.
ifor
In,
n a
mic
the
zles
with
illustrate
for
reasons
in
gest
an
us
in
Ira
U.
of
our
of
way
life;
t'orrent of science.
on
dend,
or
after
indicated
of
research,
dustry's number-one customer is
route.
still the fertilizer trade.
ever
expanding world popula¬
and the gnawing needs of
tion,
like
via
tax,
If
/
the
recent
Chemical,
Tennessee
Corporation, and Vir¬
ginia Carolina Chemical. But even
five
farmer
favorites
by research, entered
cal
fields
that
have,
chemi¬
new
importantly
may
augment their earnings from the
soil.
.
,
The
second
buyer is
now
largest
chemical
the fiber producer.
Probably somewhere
the
industry output
near
now
10%
of
goes
to
turn out the threads you may
in
hosiery,
suits
and
find
dresses;
draperies, carpets, upholstery, and
the substratas of style in one form
or
another.. Just
magic
listen
to
ready
a
ment
Musketeers.
out
from
laboratory.
list,
the
they
all
chemical
a
market
a
the
on
chemical
pulp and paper,
needing vast quantities of sulphur;
varnishes and paints and plastics.
Then too with political disturb¬
rife
ances
back
to
come
in
Asia,
we've
production
of
gone
synthetic
rubber
our
placing a new squeeze on
suppliers of alcohol and ben¬
zene.
And of
course
the expanded
chemical needs of iron and steel
are
tion
always with
a
thousand
us,
not to
other
men¬
uses
—L
V
Jessop Steel
12
——_
13
profitable
earning
Then
and
history
that
out
the
opportunity
take
5
By and large the chemical in¬
dustry has Shown in the- last
Prospects—Roger W. Babson
*
Savings Growth Exceeds Rate
25
*
•
of
Spending
of
the
FHLB Notes
*
Market
on
Hear!
Hear!
look
a
18
-
(Boxed)
this.
See
It
(Editorial)——
and
Insurance
'V
•
Business
.■
Canadian
Last
Stocks
'•
-
Man's
Cover
:*'v ";V'-y: -..-"oV
•
Bank
•
maximum ;
for capital.*
at
We
<
most
;
'■
17
•.
r-'./V;
i
;
Securities
on
rific demand for
a
we
for all
acrylontrile
and
by-product of oil
allethrin for
veloped
please
secticides
will
Mutual
The
new
ter-
•
ones
'
paraxylene
Carbide.
down
of
tance
or
with
*
Our
For
Public
in-1
14
and
Bankers—
Wilfred
18
May
Governments
L
interested
20
Salesman's
in
Air Products
27
Corner
Baker-Raulang
20
Registration
1
The
Security I Like Best
The
State of Trade and Industry
Collins Radio
34
2
years
on
•
farmer. Now,
detergents all the
on page
Dictograph
4
—
the
Tomorrow's
Markets
Washington
and
(Walter Whyte
You
Says)
30
Di-Noc
40
J
•
27
-
Published
,
offerings of
Twice Weekly
COMMERCIAL
FINANCIAL
Reg. U.
1 Drapers'
Gardens, London,
land, c/o Edwards & Smith.
and
CHRONICLE
H
Patent Office
S.
,
B.
DANA
Spencer Trask & Co.
Members New
York
WILLIAM
.
*
HAnover 2-4300
"
Hubbard
SEIBERT, Editor & Publisher
DANA
D.
-
Chicago
-
Glens Falls
2-8200
1-5
-
Schenectady
Y.,
I
news and ad¬
Monday" (com¬
issue — market quotation
records,'corporation news, bank clearings,
.state and city news, etc.).
Every
Thursday
issue)
plete statistical
Subscriptions
Worcester
-..'
Other
Offices:
Chicago 3,
111.
135
every
South
La
Salle
the
post
St.,
(Telephone: STate 2-0613);
in
Whitin Machine
office .at New
of March 8,
Act
Dominion
Canada,
of
'<
Bank
and
States,
and
per
$48.00
per
U.
Members
$45.00
Countries, $52.00
Other
,
United
Territories
Union,
(general
and
•
second-class matter Febru¬
at
under? the
Pan-American
Other
Thursday, August 9, 1951
vertising
Stromberg-Carlson
,
Works
Subscription Rates
Possessions,
Business Manager
•
Teletype—NY
Albany
;
SEIBERT, President
RIGGS,
as
1942,
N.
Curb'Exchange
50 Congress Street, Boston 8
u
25,
HovingCorp.
Eng¬
,1879.
"
,
4
ary
York,
f
WILLIAM
Members. New York Stock Exchange
COMPANY, Publishers
New York 7, N. Y.
REctor 2-9570 to 9576
HERBERT D.
C.,
.
25 Park Place,
preferred- stocks
E.
Copyright 1951 by William B. Dana
Company
»'
Reentered
WILLIAM
25 Broad Street, New York
.
37
Securities
Securities Now
impor¬
The
in
Exchange PL N. Y.»
19
Offerings...
,
are
40
39
Securities
Securities
i
We
1
Teletype NY 1-1825 & NY 1-1826
5
Report
on
year;
per
year.
•
S.
of
!
Note—On
the
rate
of
account
of
made
in
York
—
Quoted
,
THEODORE YOUNG & CO.
the
fluctuations
40
funds.
Exchange Place, New York 5, N. Y«
in
exchange, remittances for for¬
New
Sold
Record—Monthly,
eign subscriptions and advertisements must
be
—
year.
.
$30.00 per year. (Foreign postage extra.)
•'
Bought
in
Publications
Quotation
i
Singer, Bean
& MACKIE, Inc.
8
Security
Utility
Railroad
the
Continued
/
Reporter
-Prospective
chemical
depending
swam,
synthetic
>
Banks
4'
'*'•
And "
on
increased
phosphorus.
of
About
Our Reporter's
as
this item in the form of fertilizer
sank
<
HA-2-0270
may
the
Milling
33
—_
-
Observations—A.
item.. They
significant
is
Activity.
...
Notes
News
natural gas)
minor
a
bug
Another
Business
■'
Alfalfa
Dehydrating &
12
•
be little, but
the spray is big business!
advance
of
Funds
NSTA
nearly $100 million in
gross
1951.
21
*
insecticides, de¬
look
as
a
(produced
or
Union
by
don't
have
lot of
a
synthetic fibers
and
Dividends in Britain"
sulphur, soda ash, *
chlorine; and
like
on
'
"•
indications
lot of basic ":
a
Doeskin Products
8
From Washington Ahead of the News—Carlisle
Bargeron
.
this dough for plant expansion is
like
:
Corp.
8
—
National
•
.
chemicals
Dev. Res.
Kinney Coastal Oil
place the chemical •
industry in the rocking chair and .'
adrenalin league just yet.
reason
Associated
~
.
18
-
Coming Events in the Investment Field—j.
to
the main
*
40
Einzig—"Limitation
see
;>v,.
.
Bookshelf
v
spend that much in 1951. So we're
Teletype NY 1-3370
Direct Wires
Regular Features
manufacturing industry will
ready
BO 9-5133
20
Dealer-Broker Investment Recommendations
You
Incorporated
Broadway, New York 6
Philadelphia and Los Angeles
As
in-
new
the
Reilly & Co.
17
:
-
this year it's whirling along at an
annual rate of $1,600 million. No
not
J. F.
16
Bank Loans and Inflationary Trends
the chemical industry spent'
$1,220 million on plant expansion;\
other
Bonds—Stock—Warrants
so
seek
fields,
prosperity
products.
Commercial Banks
on
15
*
v
their in¬
capital gains :
economy,
will
vestment
for
*
>Further down
client
And
Lone Star Steel
dividends,
rights and.
stick. For it's axiomatic, in,
renamed
started
—Joseph J. Spengler————— 11
Crop
tobaccos. Well you'll have
hard time making that argu¬
and
Three
6
—Morris A. Schapiro
or
that we're short
renumbered
WHitehall 4-6551
National Alfalfa
phase, and are all
flatten lout earnings- >
to
nylon, vicara,
or Ion, dacron,
dynel and fortisan.
Why it sounds as though they'd
•
STREET, NEW YORK
10
wise like their elder brethren, the
these
names: rayon,
and
WALL
99
4
5
divi-;
year
'
r
'•
.•
The Impact of Higher Taxation
glamorous, *
however, maybe the party is over.'
Maybe chemicals have completed -
rails
these
Obsolete Securities Dept.
;
pay
chemicals has been
International
Davison
'
;
\
61
their expansion
Agricultural,
to
the
depleted soils clamor for potash,
nitrogen and phosphorous; •< and
create fabulous tonnage sales for
Minerals, American
cash
subscription
would
come
Here the
food to nourish
more
'
,
Financing Business in Partially Mobilized Economy
—Emerson P. Schmidt--
<
market action favorable to those
a
who
demand for
its
valuable
1
years
'
,
/From Scarcity to Abundance in Farm
Products—Edith J. Hirsch
Rohm and Haas yielding
lowly 1%. Well there are reasons;
and powerful entry into hundreds
of new products, the chemical in¬
an
■
3.2%
—and good ones—stock
pouring
a
„
New Economic Controls Act—A
Fairly Good Bill
who just can't under¬
why, today, anybody would.
buy American Cyanamid yielding
a
It's
net.
'
'
>■
,
to those doubting
growth
Even
*
handsomely
in the development of our
engines of destruction, and in the
golden
financial
conversion
of
into
four
stand
expansion
3
Thomases
Cobleigh
leadership
the
sent
Wall St.!
Population Trends and Investment (Concluding Article)
investor
answer
(
Perspective for Investors—Donald G.
Ferguson———.
so-
prefer-..
industry. They sug¬
this
to 99
3
:
.
—Walter J. L. Ray
two,
the
(the middle
'
its
These
obsoletes
It
~
ence
daz- *
1947.
1950.
bottom „of
Six
Monsanto)
•
en-
terprise
The Home
Carbide, Allied Chem¬
American
and
Cyanamid,
ical,
example of
| American
Big
in
Cobleigh.
Israel—What Chance for Solvency?—A. Wilfred
May
for
Union
are
or
in
top; and
called
this
,
4-for-l
the
~
or
war
I p e a c e
;d y
split
United
million
$220
those
Cover
Telephone:
split 4-for-l
stock
about
husbands scurrying
:
Silver Marks Time—Herbert M.-Bratter__
million
million
all
Crisis—Challenge to Our Way of Life
.
Pont
du
$480
$1,300
the
and
against
industry
the
1941
were
almost
-—Ira U.
J
single company
rewarding
most
In
A LETTER TO 3 WIVES
Cover
Chemicals—-For Growth Earnings and Net Profits
almost;
June, 1949. Dow Chemical had
$46
million' net
sales
in
1941,
century chenv,
in
been
Investor.
Joe
against
de¬
or any
would have
almost perfect
to
stock purchase in
common
any
.._i—1—
—Benjamin E. Young
net
an
scribe the mid-
1
/
to
-
."pour¬
nance,
The World
expanding popularity of chemical
•
chemistry is derived
Greek
a
the
on
•
Rearmament Economy.
a
—Philip J. FitzGerald
Killing in Wall Street and Keep It"
a
comment
Investing Under
Author of
j
Make
to
WHitehall 4-2250
Teletype NY 1-3238
'
4
The Commercial and Financial Chronicle
(504)
willing to offer silver in the East
at the 91c
Silver Marks Time
By HERBERT M. BRATTER
claim
bars
them
Noting cessation in attacks of silver users on the Silver Pur¬
Act, Mr. Bratter reviews silver metal situation, and con¬
I
cludes,
chiefly
long
so
vast U. S. silver
as
stock continues to be held
Since
The market
for the metal is too much depen¬
dent on existing silver purchase
statutes, poliissue
in Washington.
of
cies
T
r
Price
the
is
of
the
domestic silver
just a little higher
on
which
floor
the
domestic
by the 1946
ceiling deter¬
price
much
where
silver goes,
^Stabili¬
the
guaranteed
If
mines
regulations of
Office
raised
law.
e-asury,
the
ceiling
were
if
satisfied
be
OPS
silver
industrial inter¬
Some
would
above
the
of
the
new
it indirectly influences
available to industry.
supply
zation, and ac¬
tions
V
governments
of other
such
v
Mexico
out
M.
soft
Bratter
growls
users
of silver would
change in the OPS
a
the
been frozen at 90.41c
0.999 fine—the equiv¬
alent of 90.5c per fine ounce. Since
has
1951,
per
ounce
the visible supply
silver
prospective
their eyes en¬
industrial demand in this country,
tirely, and let
silver
every
users
must bid for domestic
and newly-mined
now
Denver
any- s ur p
or
silver
then, just to warn off intruders.
Treasury
Despite occasional criticism from
silver users, no movement for re¬
peal of the silver laws is in evi¬
dence. The two antagonists—the
available.
tendered
refined
All
in
such
fine
the mints
to
which
Industry
East
the
i
may
u s
be
90.5c
the
1946
it
area
might
York
to
appear
law.
more
Record
Philadelphia. But it is'
Philadelphia
Mint.
Only
York market.
to
Foreseeing
an
imminent short¬
silver, spokesmen
for
users
months
have
other
and
noted elsewhere in this
limited. The Treasury
has established a selling price of
to
the
East
well
as
"Steel," the weekly magazine of metalworking the current
Time is too short to do much, if anything, about Septem¬
over-allotments, especially on an individual company basis,
it adds. So it looks like the mills and their customers holding unber
honored CMP tickets will
involved
costs
simply have to worry their way out of
the current distribution tangle.
Whether
Eastern-
as
\
week.
to enable consumers to absorb the
sending Western-refined silver
'
industry, confusion attending allocation of steel
under the Controlled Materials Plan will not be quickly erased,
the steel
In
says
•
urged the OPS to raise the ceiling
slightly by an amount sufficient
in
23
021,000 tons of steel ingots and castings.
?: r
age of industrial
the
*
the New ?
on
high output of steel entered its sixth month last week.
This week's output is scheduled to increase the above record
successive weeks with the mills pouring out a total of 2,-'
.
fore, is being offered
unemployment
trouble, more than 2 million tons of steel have poured from the
nation's furnaces weekly for 22 consecutive weeks.
- - ;
;
small/
a
for
spite of hot weather, vacations, and other seasonal influences
that normally affect summer production, as well as sporadic labor
costs;
silver, there-
«
In
selling on tin open market still tip the balance in favor of "the \.
amount of domestic
mainly to a step-up in mili¬
dropped to 1,856,000 from 1,980,000 in June.
ment
it in the <
rather than'
market,,
which continued to be slightly in excess of last
Employment hit a new high in mid-July and
offer
to
overall industrial production
fractional rise in
a
dropped to a postwar low for the month, according to the United
States Department of Commerce.
It reported that 62,526,000 per¬
sons had civilian jobs in
the week ended July 14, about 700,000
above a month earlier and 1,300,000 above July, 1950.
Unemploy-*
per
of free Treasury sil¬
as
number
of
for
Failures
moderate drop in new
unemployment insurance as well as the total
of claims outstanding in the latest recorded week. -
applications
normally
brings
under
advantageous
it
Index
employment situation reflects a
The
at
Philadelphia Mint.
silver
ounce
is
was
past week,
tary output since that time.
Since silver is refined in the New
York
Price
Business
year's level, and it can be attributed
Silver
San Francisco.
and
freight
The supply
ver,
the
of
Because
East.
tendered to the
of foreign silver
is insufficient to meet
close
never
Herbert
see
ceiling price, which since Jan. 26,
Capitol
the
watchdogs
over
to
d
n
In
Cuba.
like
as
a
the
stated that certain additional
Industrial
coun-
*
tries
in
is
send
Silver Price
,
West
Commodity Price Index
J
There
freight costs, silver refined in the
New
Industry and Domestic
the
by
and
Normally, only about one-fourth
is
refined
ests
Output
Trade
processors
of the domestic mine production
elsewhere.
politically dead
Silver is never a
Retail
Auto Production
0.999 fine.
ounce
an
Electric
Food
from the Treasury.
Purchase Act.
■
the
Steel Production
State of Trade
account
own
customarily
charge only for fabrication, they
would lose money on silver bought
supply market for domestic silver production at favorable
:
of 90.41c
cess
price, Mexico, the leading producer, is in position to stabilize
world silver market. Sees no sign of move to repeal Silver
;
their
for
anything they pay for silver in ex¬
security for outstanding paper money and the mints
as
absorb
Thursday, August 9, 1951
Carloadings
regulation requires the processors
to
chase
an
.
The
buying Treasury
ounce because the
from
silver at 91c
.
e
price. Moreover, proces¬
that the OPS ceiling
sors
.
any
corrective measures will be taken
uncertain. Government control authori-;
radical
for the fourth quarter is
article,
is
refined
91c per
fine ounce for such silver
market.. Whereas at present
70%
of
all
newly-mined
silver ac¬
ties, it notes, think the "bugs" in CMP will work themselves out
ing to accommodate themselves to
the status quo, with perhaps
and the metal is available at that
much out-of-hand
users
the sellers—seem will¬
and
minor
silver
the
to
New
York
adjustment in OPS regulations.
price in New York. Since most of
quired b,y the Treasury is mone¬
tized and only 30% goes into the
The OPS ceiling is what deter¬
mines today where most of the do¬
the
"free"
mestic
comes
silver
newly-mined
sold: whether to the assured
ket
at
price
the
of
mints
90.5c
at
fine
a
is
mar¬
guaranteed
a
ounce,
domestic newly-mined silver
comes
to
the
Treasury
which
will
entire
there is
gued.
some
the
Philadelphia Mint,
question as to how
will
Treasury
continue
domestic
it
output,
According to New York
American
the
1950.
announce
the withdrawal of
Will arc! T. Grimm
as a
General Partner
as
of
V
July 31st, 1951
KIDDER, PEABODY Sf CO,
-v
founded 1865
pay, they
'unable to
is
rate
ant
a specified period usually falls below
This is especially true of the military. The
anticipated unspecified tonnage along with the new
agencies' actual take in
resulting
PHILADELPHIA
is
continue
users
re¬
idled Studebaker one day and
stated
those
by
who
was a 10,000its previously
announced plan to suspend operations of its Michigan plants for
six working days, "Ward's" stated. Chevrolet's branch assembly
decline
unit
.
want
S. Treasury
Sales
rials
and
.
modifications
of
the
12, 1943. With certain
provisos, the 1946 act authorizes
the Treasury to sell or lease for
manufacturing
held
States
Announces the
231
directed
SOUTH LA SALLE STREET
■■
to
conduct
a
J
.
j"
general securities dmsiness
-1V
sell
to
is
provisos
must
possession
CHICAGO 4, ILLINOIS
than
be
silver.
that
held
in
control to
or
J
-
to
.
specialize in
private
placement loans,
ver
'
mergers,
Steel
August 1,1951
transactions.
0
*'
Phone Financial 6-5265
record pace of capacity, production and sales, according to "The
Iron Age," national metalworking weekly, in its current summary
Continued
;
on
page
INTERNATIONAL ARBITRAGE
Treasury
secure
all
certificates
convert
and
so
Foreign Exchange
.
—
Foreign Securities
Foreign Coupons
and
Scrip
•
Serving hanks, brokers and security dealers *
the
released
into
bullion, which it then could
By selling silver in substan¬
,
amounts
the
Treasury could :
depress the :
price of the metal; and under cer¬
tain circumstances, by refraining
from selling it could contribute
hold
financial
,
One
enough
down
toward
an
or
even
increase
in
the price.
The Treasury's powers to sell sil-
Continued
on
page
16
and
Output Drops Slightly This Week
an
sell.
tial
Bale of companies and similar special
cars
113,-322 trucks built in U. S. plants in July.
outstanding silver certificates. It
is also noteworthy that the Treas¬
ury,
quite apart from the 1946
law, has the power to call in sil¬
standard silver dollars
and
90.5c.
for 430,000
This law provides a floor
the
silver
W.T. Grimm & Co.
less
call
ceiling at all. Note that
Treasury is authorized, but
not
of
not
August
Earnings of steel companies are lagging far off the all-time
silver
United
any
the
by
for
no
the
formation of
at
ounce.
but
uses
owned
or
schedules
122,000 truck completions, it added, compared with 382,407 cars
Act of July
of Kidder, Peahody & Co.
from
shortages, but resumed output Monday, according to "Ward's."
Production
31, 1946, which is an ex¬
with
tension
partner
resulting
Motors
Packard remained down for the second week because of mate¬
of July
general
General
by
plants began their suspension this week, the "Agency" added.
the OPS ceiling raised.
powered to sell silver by the Act
Willarcl T. Gri mm
Hudson all week.
Another factor affecting last week's operations
themselves
find
may
The Treasury is at present em¬
a
be
stated requirements.
of-
compete with world
for the available supply,
U.
formerly
will
Balance between
of
by'
to the price they may
as
demand
CHICAGO
announced,
are
American
it
BOSTON
NEW YORK
just
24,058,520 net tons of finished steel will exceed indicated supply
21,336,000 tons by 1,551,505 tons after allowing for an adjust¬
ment reserve of l,17i;015 tons.
However, experience shows claim¬
sources
Foreign stocks available for
here
stricted
,
allotments,
for the current three months.
supply and demand will not be achieved, but the margin of error
will be smaller than in the current quarter.
Total allotment of
1951
ounce
as
adjustment reserve, it is thought, should provide an adequate
limited, and the
insurance margin against serious unbalance.
Western Hemisphere exclusive of
Further, indicated
the USA produced last year only A supply for fourth quarter is some 500,000 net tons greater than in
third
93 million ounces.
quarter.
Consequently,
over-allotments
are believed un¬
Mexico, hav- T
ing announced a large-scale coin- \ likely to exceed 10% compared with 15% in the current quarter.
age
program,
may
be a buyer.
Automotive output last week was less severely affected by
Also that country has been seek¬
labor trouble than at any time since June, according to "Ward's
ing coinage orders from abroad
Automotive Reports." Labor disputes, which had plagued Chrysler
and
recently
sold
17
million
Corp. repeatedly for a month, subsided, giving the corporation a
ounces of silver to Saudi Arabia.
4,000-unit output gain, the "Agency" said.- However, labor troubles"
sale
If
,
million
120
in
as
had been feared a week or so ago.
rate, states this trade weekly, with sentiment mixed as
much the same
at least equal
or
as
Fourth-quarter
changed.
ar¬
silver
industry
likely to exceed
We
of
consumption
Further, they now feel the situation is not
passes.
regards the efficacy of CMP in solving the distribution problem,
there is little chance the system will be abandoned or radically
Situation
Supply-Demand
the
is
time
At any
account,
the
suggested
in the OPS ceiling price
enable users to acquire the ;
change
tendered to the
long
or
to it in the West and is not
as
Albert
-
;de
37 WALL STREET
Jong
:
Telephone HAnover 2»5590
'
"
&
Co.
NEW YORK 5, N. Y.
"
Teletype NY 1-1401
26
Volume 174
Number 5036
The Commercial and Financial Chronicle
...
Israel
ISRAEL: WhatChancefof Solvency?
thoroughly unique in inter¬
national finance.
1950, the
.
notes
obstacles arising
shortage economy, military expenditure, and huge-scale immigration.
Based
on
analysis of balance-of-payments structure, concludes
"solvency" over short-term depends on American co-reli¬
gionists' subscriptions to National bond drive and philanthropic
funds; and over long-term on adequate returns from present
|
from
capital investments, and
severe
1950
Balance-of-Payment?
OUT-PAYMENTS—
For
shipping
For
travel
Israels
on
and
series of articles
a
fiscal,
political
vant
the
to
economic,
situation;
interests
the
Capital
on
Private
investor of individual and in¬
dustrial foreign capital.)
From
It
is recognized
Israel's
of
as
basic
the keynote
national
From
that the successful
For
"solvency"
long terms,
the economy depends crucially on
the securing of substantial capital
tensive
investment,
ment
her
short
the
over
and
must first recognize
unique
basic
therefrom
obsta¬
second,
analyze
her
balance; third,
b
a
1
production
the
payments
the
internal
ation.
c
basic
A. Wilfred May
lties
c u
ship
eco¬
tering
threefold: shortage
and
materials;
raw
un¬
avoidable expenditure for military
defense;
and
mitments
scale
self-imposed
for
huge-
immigration.
The Huge Impact of Immigration
The
task,
which
would
by
be
country
for
imports
—
seemingly
a
se¬
of
these
rate
of
inflated
corresponding
local
number
currency.
the
long-term,
Israel's
coming-through will depend on
the fruition of capital investment,
the world price level,
To
the
American
on ex¬
enough in the building-up of
new independent economy, is
intensifies
the
squeeze
home economy in
the consumption
($320
was
million
spent
many
of
,
and
bonds,
position
incidentally,
concluded
in
arises
in yhard
for
a
The
from
trade
suredly
ways—in
materials
19532
m'llion
of
dollars)
i
imports
and
credits
of
340
his
that
1951
104
120
132
146
75
'
96
regarding the
through
conclusion
is that
internal situation
RECEIPTS—
■rlfi
60
buyer
of
must
be
it
investment
controls, it
be kept in reasonable check
can
and
immigation
in
"ace in the hole."
as an
event, it is the inter¬
any
national
elements,
payments
nation's "solvency" and
the
ervation
her
of
credit
Internally, the shortage situa¬
understandably brings about
position of the government's
Paul S. Bcwden With
Francis I. du Pont
——
rising prices.
'
The
65
the
private
Bank
90
______
funds
budget
expenditures
23
balance
40
Euclid Avenue.
formerly
60
425
The-sterling balances represent
completely
Mr.
prior thereto was with Otis &
■"'**
Co..
of
With Hamilton
Managem'nt
(Special to The Financial Chronicle)
ordinary
exactly
in
1949
50
(at £43
Colo.
joined
DENVER,
was
—
National
Wall
-
called
"Development
Budget,"
(Special to The Financial Chronicle) '
military
next
,
•
,
balance
position
important.
vitally
is
balance
would
help
as¬
A
in
abroad
and
the
extension
1954-63
$3.5
$2.7
Recent
increases in currency
Effective Sept.
member
the
of
Exchange,
will
derman
with
Rose
4.2
circulation
downward
and
in
demand
form
offices
OF
THE
FORMATION
Association
at
BUSINESS
&
Davies
Alisal
a
Barrett Herrick Adds %
(Special to The Financial Chronicle) „(
I
ST.
LOUIS,
O'Connor
is
Locust
Mo.
now
Herrick
—
Co.,
Street.
Paisley
GOTTRON, RUSSELL & CO.
of
Exchange
CONDUCTED BY ME AS SOLE PROPRIETOR
Cleveland 14, Ohio
Bld-g.
'I
Au-ust, 4,
1951
'
CHerry 1-5050
James
associated
&
OF
1582 Union Commerce
B.
for
Stock
Warren G. Steffen
JOSEPH J. LANN
&
members of the
Exchange, 62
Street, will become
partner in the firm on Aug. 16.
York
West
J. E.
The Midwest Stock
»
Broad
Co.,
New
T. Howard
FORMERLY
41
To Be Davies Partner
L. Warren Foster
Member
Fe-
SALINAS,
Calif. — Cedric
Macauley, resident manager
Florence C. Bland
of Securities Dealers
Stone
Federman
WE ARE PLEASED TO ANNOUNCE THAT
Bolger
Stock
York
Street.
in Barrett
de¬
1, Reuben Rose,
New
Justin
and
4.5
8
11.3
Street, New York 5.
THE
L.
of
in
Oakes
has
the staff
and showed a surplus Hamilton Management Corpora¬
during the first six months of tion, Boston Building.
fiscal
1950-51
(£68.5
versus
£63.5).
Besides there is a soWith Willard T. Grimm
Telephone WHitehall 3-7286
TO CONTINUE
'
Orville
JOSEPH J. LANN SECURITIES, INC.
37
Bowden
municipal
the
department of L. W. Simon & Co.
and
non-recurring credit item, since which, outside the Current Budg¬
terminate
in
million),
70
issue
budgetary situation is that
current
1010
was
ARE NOW ASSOCIATED WITH THIS FIRM
Members
pres¬
stable
the lid of
on
W. J. Busliea
MADE
in
de¬
currencies.
—
IS
of
curtailment
eventual
—with
is
Economy
strong efforts to sit
9
8
credits,
remittances, etc.
S. Gr$nt-in-Aid (?)_.
Charitable
a
''jZi ■,A :V
releases
Export-Import
they
existing loans at their maturity;
permitting
stabilization
of
the
year, which was stretched to cover
currency
at
a
realistically
de¬
1,380,000 individuals at the end of valued
rate,
leading to foreign
the
year);
in accentuating the exchange convertibility, and help¬
secure
desperately
needed
housing emergency (48,000 dwell¬ ing
ing units now being programmed foreign capital investment.
But for short-run solvency, we
for the next four
years); etc.—all must examine the
balance-of-pay¬
accentuated
further by the low ments situation
in the case of
ANNOUNCEMENT
of,
extension
and
policies
present
and peace.
tion
Bond
maximum
Internal
The
40
425
U.
consump¬
of
1,250,000 at the beginning of the
June
essence
tourism45
service
Sterling
the
various ways, such as in providing
the basis for the securing of new
currency
population
1951
truly entrepreneurial
(Special to The Financial Chronicle)
; !•
worthy of equity return; but
with compensation yielding mere¬
CLEVELAND, Ohio — Paul S.
ly that of a high grade investment Bowden has become associated
obligation.
with Francis I"! du Pont & Co.,
1951
(In
Commodity exports
Shipping and tourism-.::..-
a
favorable
raw
Jan.
CHICAGO,
111. — Burnette
A.
et, extends aid for housing, pub¬
Backhaus has joined the staff of
Another
drain
on
the
sparse February.
lic
works, transport and com¬
The
credit
from
the
W. T. Grimm & Co., 231 South
Export- munications, and industry.
foreign exchange supply — un¬
The
La Salle Street.
avoidable and seemingly chronic Import Bank totals $135 million funds
are
provided by Exportof which a, maximum of $100 mil¬
in
the
light of the continuing
Bank
credits
Import
together
lion was authorized in 1949 and
nearby
Arabic
assassinations —
with internal government loans.
Federman & Rose
r
the
on
57
Our
"
Besides these there is the mili¬
needs.
Al¬ $35 million in 1950. Having al¬
though the amount of the military ready received $64 million in 1949 tary budget, whose exact total is
any
budget is kept secret, it probably
and 1950, there is $71 million more undisclosed, but £12 V2 million of
immeasurably accentuated by the
ranges between £30 million and
which is known to be contained
humanitarianly motivated, unani¬ £40
to come; of which the $40 million
million, of which from £3 to
in the Current Budget,
and the
mously endorsed policy of per¬
£4 millions involve the
use
of as specified in our table will come balance, thought to be £20 mil¬
mitting unrestricted and perma¬
the treasured foreign exchange.
in
nent entry of displaced foreigners.
1951, and the remaining $31 lion, is financed by loans.
Certain is it that the two factors
The country's internal
funded
This
million
in 1952.
in-gathering
reached
the
Repayments to
of immigration and the military
debt is only about £25 million;
huge total of 128,000 persons dur¬
have been the major contributors Ex-Impf on account of maturities
the big element of inflation lying
ing the first six months of this
to the nation's 1950 trade deficit of principal and interest, due as
year, and is now proceeding at a
in the floating debt consisting of
of £89.4 million, made up of im¬
follows, do not constitute a serious
steady rate of 25,000 each month.
Treasury Bills, Land Bills (floated
of
£ 102.6 million versus
The cost to the country of re¬ ports
item, being small in proportion to
exports of only £13.2 million (in
against the development of land
the country's total liability obliga¬
settling each individual is esti¬
1949, there was a deficit of £77.4
and used to finance the develop¬
mated to be approximately $2,500, million
from
imports of
£87.9 tions.
ment budget) and in the money
making a total cost of $l1/2 billion million versus £ 10.5 million ex¬
Repayment Obligations to
in circulation
(increased neces¬
ports).
for the 600.000 admitted since the
Export-Import Bank
sarily following the
population
establishment of the State.
Principal
Interest
This Balance of Payments "Solvency"
(million)
(million)
growth).
vere
50
1950
continuation
that
conversion
the
in
Over
follows:
as
1950
June
proceeds
Balance-of-Payments,
Short-term
squeeze.
the
at
Jan.-
picted above, which are crucial to
govern¬
the
Non-currency imports
The Defense Factor
com¬
continuing
the
54
industrialists
indicate
Shipping
austerity
indicated
is
45
Fund
with
approximately
Debt
tion purposes, to one-third of total
underdevelopment of natural
resources
which
discussions
Commodity
practised to further future
productivity
are
to
Bank_
Deposits
But
9
National
Demand
Circulation
$2.80, leaving the Israeli Govern¬
ment free to expend most of the
OUT-PAYMENTS—
trade
curtailment of incoming goods en¬
the zealous steersmen of this
and
the
irresponsible.
as
extent
is now
onfronting
nomic
relegated
The
d i f f i
reduce
decried here—and reliance there¬
on
■
14
*
1951, estimates based
Estimated
currently-publicized pros¬
pect of oil discovery as the even¬
tual saving element is generally
of
•
Currency In.
and
The
economic situ¬
The
will
incl.
61
Export-Import
Jewish
dollars
realized
particularly and addi¬
important in providing
52
credits
officials,
be
by decreasing imports of such
products.
'
po¬
stock
to
bond issue, plus
are
tionally
6
42
remittances
economists,
and
tentialities;
and fourth,
take
overcome
deficit both by increasing exports
nce-of-
a
productivity
on
new
be
must
sources
37
(inv.)
320
of the country's potash potentiali¬
ties and of its overall agricultural
trade
estimate
and
sufficient to
Thus, the successful development
inter¬
current
exports
traveling
releases
building-up of
the present large gap in the trade
deficit within a reasonable time.
cles;
national
It
policy
TEL-AVIV, ISRAEL—In weigh¬
ing
the
prospects
for
Israel's
we
30
Miscellaneous
Investment
the
320
short-term
Concentration
service
Non-currency imports
Other capital imports,
displayed by the displaced person.
The
debt
to
(United Jewish Appeal).
Commodity
Sterling
least temporarily
at
rele¬
of
and
>
*
.
(In millions of £)
will depend squarely on the
generosity of American co-reli¬
gionists, through liberal subscrip¬
maintenance of their liberal dona¬
tions to the philanthropic funds
30
Total
on peace.
productivity
260
!*
shown in the following
are
term
RECEIPTS—
Shipping
(First of
important conclusion from posits
foregoing picture of the bal¬ table.
ance-of-payments position, is that
clearly solvency over the shorter
tions
commodities
For
The
the
For the calendar year
balance-of-payments was struck
as follows,
in millions of dollars:
By A. WILFRED MAY
Observer
t
5
(505)
Inc.,
M.
with
418
6
(506)
The Commercial and Financial Chronicle
j
''""
Business
Partially Mobilized Economy
By
RAY*
WALTER J. L.
Executive of leading home financing association reviews achome mortgage agencies and reveals that
tivities of various
K
j.
despite government participation in the business, private con-
!<
cerns
still furnish bulk of home financing. Says home owner¬
trial nation—we appear assured
ship is flourishing and home financing has become easier and
less expensive.
Looks for
some
ity than
decline in housing construction
needs, but holds this development has curbed
'
y
In
it
would
give
of
be
well
thought
the
are
ing
available
the
subject,
ilies in
first
of these
to
background
of lenders
types
mak¬
for
financing
c a n
f
new
~
existing.
Of
I
these
the
savings
and.
Joan business
with
which
have been
sociated
I
has
grown
and
United
the
the Savings
approximately
taled
petition and
of
start
billion.
$6
for the pur¬
alt the financing
American
of
homes,y new
On new residential
existing.
we
one-fourth of all
been
finance h about
that is built. V
,oan
business is the principal factor in
savings
and
there
finarvm?
h
little
o£
buy
opportunity
ness
or
as
he pleases, can
did
not
exist
in
com-
About 21% of all home
p0nents
financing last year
fhrnil-h %ornmprrial
was
banks
done
al-
commercial banks
tvIp
Because this
home.
a
com¬
free economy. It has
a
of the
one
owners.
^njf tankf
Ire krlelv
whkh
nearly all European countries, it conrerkrated in the
was only natural that out of the
vast immigration waves flowing
into this country in the last half
East"
ransti-
■
is
*/.,■
„
;;;;'v.:;t /
matter of
a
little
no
■
r
the
19th
century, there should
spring up in many localities small
group organizations where neighbors
pooled their savings to provide home financing credit
for
other thrifty
and prudent famr
*An
address
by Mr. Ray at the Stan¬
ford
University
Business
Conference,
Palo Alto, Cal., July 26, 1951.
Established
1856
H. Hentz & Co.
nificance
York
New
Stock
Exchange
Curb
Exchange
Cotton
Exchange
York
York
New
Commodity
Chicago 1
New
Exchange,
Board
Orleans
And
of
Cotton
other
N. Y. Cotton
iT0
of
7%
about
of
comnosed
p° ??e
°
10%
cannot
The
done.
be
-
most
•
dra¬
matic and convincing proof Of this
development
1947
offered
was
statistics
*
the
of
in
the
Bureau
of
Census, which showed that
4-3% of all families with incomes
under
$3,000 owned their homes.
However, although the progress
of
been
home ownership has
impressive in recent years,
it
but
private
is
ahead.
promise of
a
Because
of
my
what lies
faith in a
free and
dynamic American econ¬
I am confident that the next
omy,
several decades will
advances
see
?1!?u l!
1
Our in¬
advanced through
independent mortgage companies
and individuals. It is interesting to
note
that
individuals, on their
own, do about 17%
of all home
lending, although this practice is
credit
ing
far
is
in the smaller
common
more
towns and cities than in the
Savings
*
ing is
the
assets
h
in
invested
Exchange BIdg.
mortgage lend¬
relatively minor phase of
a
investment
savings
and
the end
of
82%
loan
their
of
as
>
the
of
tal
mutual
Oll/L 9f0<J
requirements
of the discriminating
•
Central Location
•
Spacious Rooms
•
Homelike
Atmosphere
•
Delicious Food
•
Intimate Cocktail Lounge
•
Excellent Service
one
Now
have
terms
extended
been
sharply, in many cases up to 20
and even 25 years.
In addition,
it
possible to in¬
steadily the percentage of
have found
we
crease
the loan to
appraised value as our
have
methods
appraisal
become
scientific and accurate.
more
At this
has
point, I want to empha¬
States
United
the
s e e n
.
Archibald, Manager
Madison Ave. at 54th
than the replacement of
the shortterm "straight" loan with its ex¬
pensive and periodic refinancing
charges by the monthly prepay¬
ment loan, amortized over a sub¬
stantial
this
number
8% in life in¬
and
18% in
banks.
This,
loan
and
as¬
organized only to
savings service and to
arrangement, the borrower
if you please, pay off his
may,
mortgage like rent each month. No
device has proved so successful iri
financing, which is now
standard
practice for nearly all
lenders.
So
far
as
the actual
ing made every day towards mak¬
ing a more effective and conven¬
ient instrument for the benefit of
the
home
of operation.
Home
Ownershhp
tions
cure
Flourishing
major
charges,
few
home
owners.
figures, there
To
were
re¬
36% of all urban families.
there
were
institu¬
a
large,
for
constructed
better
far
than
comfort
and
by
are,
ening consideration
is
wise,
institution
an
few
he
wherein
program,
private loans would be
made to returning veterans with
the Veterans Administration em¬
powered to guarantee part of the
and thus encourage lenders
of
those
larger loans to veterans
More than
make
to
non-veterans.
to
2,500,000
GI
loans
have
been
made, and only a fraction of 1%
of these have turned out to be
loans. During the first year
operation, our. institutions
of all the GI loans is¬
poor
its
of
made 80%
sued.;
'
' ..i
.
«'
the wantsTo
sum
up
the government
and -conveniences
of
the home
entry into home financing, we find
buyer.
,
the HOLC was successively fol¬
Our fantastic postwar home lowed
by the FHA and GI pro¬
of
building boom has given us a
larger inventory of "almost new"
houses than we- have ever had
before,
times
three
probably
large
as-
as
before
inventory
to
four
comparable
a
World
War
Recent statistics of the Bureau
the Census show that 14%
population
that
of
every
is
seven
most
consequence
government-
aided
our
of
house or apartment.
?■ The remarkable strides in hous¬
ing production have been made
possible by the introduction of
a
rates
and
be* misled,
governing the
the
rate
interest
mortgage
Lest
anyone
regulations
FHA
VA
and
of
structure
term
loan
and
has been the esr
national pattern
programs
tablishmnt
loan terms.
houses
shade of doubt,
a
important
of this succession of
for
living in
now
the
of
In other words, one person
a new
Beyond
grams.
II.
built between 1945 and
were
1950.
in
in
living
are
production methods of .4%%;
We have seen, in
As a result of the governmentyears, the development of aided
programs
during the last
home building.
"merchant"
"operative" build¬
or
two decades there are
ers—many of them here in Cali¬
fornia—who have huge organiza¬
active
tions, and
GI
able to build hun¬
are
has
Of great significance, also,
the development of a
number
successful
of
house
prefabri¬
manufacturers
turning out houses on an as¬
sembly line basis.
-.
ance
for
situation
the
home
take
and
future
in
financing,
few
a
cause,
(1)
I wish
,
showing
the imme¬
prospects
building and
would
and
and
more
recent years;
the
for
future
taking into account what
roughly 1,150,000 pri¬
non-farm
vate,
started in 1950
GI
a
more,
role
16V2%
or
nanced with
pro¬
an
of the balance
and, (2)
a
pro¬
without
will
were
In 1945
15 million home-own¬
ing families, and by early 1951—
At
a
FHA loan and all
were
financed with
or
required
mortgage financing at all. You
can
see
that
even
in
new
when
nancing have been most popular,
entry into the home financ¬
these
ing business back in 1933 with the
enactment
of
the
Home
government programs have
Continued
Owners
on
/
STRUTHERS WELLS CORPORATION
Stock
Common
rapidly
penalty
Celebrating
Earned
seek out
these
$2.91
103th Anniversary
Six
10 Year Average
Months
May
1951
$3.45 per Share
Available
on
Request
Financing
higher #costs are everyday oc¬
currences, it should be heartening
to
the
home
Hayden, Stone & Co.
higher prices
and
buyer that the cost
con¬
broken for extensive govern¬
ment
or
Memorandum
time
few
total, fi¬
of the
renders
Improvement in Home
a
struction, where FHA and GI fir
think
services.
about
units
financed with
"conventional" loan
no
govern¬
dwelling
were
There
loan.
do. The ground
ment may
was
each of the three
I will begin by
by what type mortgage
cent of the
review
it is impossible to make any
jections
to show the relative
now
financed. Fifteen and one-half per¬
government in both
more
of the
loan the houses built in 1950 were
like to
the government's
has become
nounced in
carries all
importance of
I want to do this be¬
areas.
the
Under
guarantee.
institution
ing
the
minutes
the role of the
these
I
program
which
government assist¬
risk.
Before moving on to
diate
or
(or
the "con¬
loan
form of
no
and
lending programs.
Finance
•
lending
"conventional" program, the lend¬
of Government in Home
Role
program)
ventional"
who
"are
loan
has
been
cated
today three
competitive
programs—the FHA, the VA
dreds and thousands of homes each
year.
and
years
for
the
most
.stringent.
For example, a little
more than
a year
ago, the FHA,
without any advance notice, sud¬
denly reduced the interest rate
on
its
mortgages from 4V£
to
programs are
semi-mass
may se¬
as
without
that
loan
home
GI
than
today
and pay his real estate
taxes month by month.
If a bor¬
rower
of
tion
and
built
Rights in 1944, one sec¬
which provided for the
con¬
advance
his loan
up
Gov¬
of the
the
by
GI Bill of
loan
modernization of his
wishes
Federal
ernment came with passage
strengthen its hold on the title of
"best-housed nation in the world."
Houses
step into home
The third major
financing
variety of
a
mortgage
only
repetition of the treacherous cy¬
cle
of
''peaks and valleys" -in.
home building.
'
just
under 10 million American homeor
pay
he
as
the
additional
an
home,
a
in
the repair or
This division of participation in
the American home finance is a
reason why home owner¬
ship is flourishing in the United
States today as it has never been
before. We have, in fact, become
include
today
in that the borrower
ago,
Is
Many
owner.
tract unheard of
broadly defined
scope
mortgage
itself is concerned, progress is be¬
tions have
nation of
Under
gage
were
more
years.
pioneering for this type of mort¬
savings
a
of
in
owning families in 1900,
St., New York 22
procedures, few have been mod¬
ernized and improved to the same
extent.
None of these improve¬
ments. has been more
important
provisions
cite
PLaza 3-9100
a
Of all types of financing
finance.
give the home building industry an
occasional "lift" and thus avoid a
liberal
size the fact that the past decade
recent
golden key to progress in
ownership has been a strong,
active and resilient system of home
The
finance debt-free home ownership,
while the other types of institu¬
a
For reservations
Theodore B.
in
home
in
Our savings
afford 1
housing.
invested
assets
compared to 5%
reflects the fundamen¬
purposes of each type of insti¬
sociations
meets the
of other
course,
tution.
by
associations at
roughly
companies;
surance
small
meeting the "mass" requirements
for home ownership, and I should
like to point out that the savings
association business did the job of
program
last year had
home loans
PITTSBURGH
SWITZERLAND y
pre¬
mortgage
o m.e
types of lending institutions.' Our
Exchanges
DETROIT
associations
loan
and
their
large
centers.
loans while home
Exchange
of
The rest of the home financ¬
have
Inc.
made 31%
year
all the mortgage loans under $20,000.
housing and home ownership
compelling that all
that has gone before will seem
swift and
than
u
commercial banks;
GENEVA,
long ago, as some of you will
a mortgage usually matured
to five years, with expen-,
sive fees involved in its renewal.
Not
recall,
that "the
also
comparison. Surely no
horizons of our expanding Amer¬
is
ican
economy
appear brighter
insurance
of
all home credit.
of
dominantly
Trade
mortgage^
all
fife
the
u:
stitutions last
.
NEW YORK 4, N. Y.
CHICAGO
,
."ownership has
home
so
crfdit Still another Lment
t£f home finandng stmdure
metropolitan
Members
New
financing
of
sig¬
iLwaif hnS;- in,
of
4
generally
wear
It
a
arp
°th«r important
his money, and open a busi-
save
free
the
the
while
number
please note, I did^not
as
ahead
years
of the American way of
•
"P1**
or
upon
should
II, the resources of
and Loan business to7
War
World
the
before
1940,
construction,
because
1?
homeowners
in- the
ernments
goals of the United
States Savings" and Loan League
to have 75% of our families home
In
and
most
business
fliCri
hard
of
local, state, and national gov¬
our
i
chase
Walter J. L. Ray
as¬
flourished
impact of this
likely
army
govern¬
give heart to all of those
who believe in the utter Tightness
of
bf my business career. Like many
other businesses the savings and
oan
1951
Thursday, August 9,
.
'
yesteryear. There is a far higher
surge of
degree of "livability" in. the new
penetrated
-1951; house,
which means that
to all income classes in America,
homes tare being designed, built
participants in the home financ¬
despite the cynical claims of our and equipped with an ever-broad¬
ing field, doing more, than a third
leftist brothers who contend this
lenders,
the
most
impors in g l6
is
The
of
simple; first, to stimu¬
late thrift and personal savings;
and, second, to finance private
home ownership.
Today they approximate $18 bil¬
lion—nearly a three-fold growth
in just over a decade.. As a result)
our institutions are
the dominant
lanf
group
vast
called "Building and Loan"
associations. Their aims and pur¬
were
any wild,
changes in
and
ment.
,
f
o
their communities.
Most
small community groups
poses were
the
,
i
e r
m
homes,
and
us
total
funds
A
for
the
to
various
who
our
resist
will
extreme
democratic type
our
■■
consideration of
sound and solvent America, home
abrupt
'
.
have heretofore pos¬
we
owners
ing boom. Sees long-term housing outlook promising.
of
political stabil¬
Because of their stake in
sessed.
a
extreme build¬
an
firmer basis for
a
due to credit restrictions and diversion of materials to defense
'
.
his home today is Loan Corporation Act, whose pur¬
lower than it was for pose was to have the government,
assistance,
his father a generation ago. The with direct financial
cost of home financing is the only help revive a nationwide break¬
ing homes or roughly about 54%
cost involved in housing that is down in the home mortgage sys¬
of all our nonfarm families.
less than it was in the past; 25 to tem due to the depression.
As a result, for the first time in
30 years ago, mortgage
The
second
major step
into
interest
our
history, a clear majority of
costs typically ranged from 7 to home financing
by the govern;
our families own their homes. This
ment was taken in 1934 with the
is a fact of far-reaching social and 10%; today they average out at
about 5%, which represents to the establishment
of
the
Federal
political significance. With home
Housing
Administration,
whose
owners
outnumbering tenants — family, with a $10,000, 20-year
mortgage a savings of about $4,200. function, by providing a system
something which has never hap¬
of
Still. another advancement has
government insurance against
pened in any other great indus¬
been
made
in
mortgage terms. losses on home mortgages, was to
thanks mostly to our postwar
housing boom—there were an es¬
timated 20 million families own¬
President, United States Savings and Loan League
}
.
1
■■
The Home Financing
In
''
25
Broad
Street, New York
4, N. Y., Dlgby 4-6700
page
24
Volume 174
Number 5036
kmmmm
■r-x-:-:-
.
.
.
The Commercial and Financial Chronicle
'
(507)
-
w$m
1-
ASSOCIATES
'
'
&
S?
INVESTMENT COMPANY
Associates Discount Corporation
|1
£1
AND
OTHER
SUBSIDIARIES
Commercial and Installment
Financing
p.v.wX
MM
HIGHLIGHTS FOR THE FIRST SIX
CONDENSED
ASSETS
MONTHS
CONSOLIDATED BALANCE SHEETS
.
,
June 30, 1951
Cash
and
Marketable Securities
Receivables:
Motor Lien
•
;
'-V-y'-'Vy...yyy-
...
-y/y^vlll' A :;1'-' -A '■■/■••T''; A
•
i$321,618,509:.
;
...
Commercial Loans
54.431,374A
$
..v.
Small Loans
'..
/..
•!
:
20,951,522
Chattel Lien and Other Receivables...
7'/
Less: Reserve for Losses...'
Total
$242,732,964
21,685,380-
;
Other Assets
6,566,927
7,490,654
$370,822,338
*$276,497,845
7,998,568,
5,665,445
...;
Receivables, Less Reserve
$362,823,770'
I
Your
$270,832,400
3,025,940-
TOTAL..
14,492,575
11,781,652
■V
z
2,474,992
$420,281,084
$321,329,428
You
initial
in cash
or
"trade-in" with your
dealer, and sign
LIABILITIES
pay
a
note
the balance in
regular monthly instalments.
Payable, Short-Term.
•
..
Accounts
the
down payment
a
agreeing to
Notes
make
i
Payable, Accruals
Unearned Finance Discounts
'
and
and
$244,553,000
■
V
-
lr-.—
•
•
Insurance Premiums.
.....
.
"
>>
Preferred Stock
*.
...
to
are
no
arrange
and
for fi¬
insurance.
embarrassing in¬
vestigations—no red tape
or
other inconveniences.
$189,181,800
..:.
19,765,300;
14,396,633
32,160,231
29,879,825
40,000,000
20,000,000
22.500.000
22,500,000
9,800.000
;
Common Stock
10,418,240
10,418,240
Surplus
41,084,313
34,952,930
$420,281,084
$321,329,428
TOTAL
office
nancing
There
the
■
Reserves
1
Long-Term Notes
Subordinated Long-Term Notes/.
3.
dealer calls
local Associates branch
7
CONDENSED CONSOLIDATED INCOME STATEMENTS
Result: You drive home
.
/
Discount, Interest, Premiums and Other Income
Six Monihs
Six Months
.
Ended
June 30,1951
June 30, 1950
$ 30,246,761
$ 22,818,526
Ended;
4.
19,105,365
Net Income before Income Taxes
Provision for Consolidated Federal Taxes
Net Income
Consolidated Net
on
Income
-
'
V
$
South Bend, Indiana, August 2,1951
'
$
3,205,000
$1,045,485
,
•'
$5.04
$4.84
•
expe¬
Associates
sonnel takes
care
per¬
of all
details of
transaction and the "OK"
is flashed
8,250.485
5,461,396
-
your
14,568,041
5,680,000
Earnings Per Share of Common Stock
After Payment of Preferred Dividends
$ 11,141,396
rienced
the important
*
Operating Expenses
Prompt action by
to
the dealer.
5.
in your new car
delay
or
without
fuss—assured
by the Associates-Dealer
relationship of the continued
interest and service of both
organizations.
8
The Commercial and Financial
(508)
Electric Co.—Memorandum—Aetna
Kuhlman
'
Ill
Dealer-Broker Investment
It
:
to Bend
interested parties the
COMING
1
•'
Inc.—Summary
"
Co., Inc., 199
Products, Inc.—Data—Chas. A. Day &
Washington Street, Boston 8, Mass.
;
Farm Equipment Companies—Review- -Dean Witter
Wall Street, New York
&
Co., 14
on
Curb
St.
Stock
and
,
options—Thomas, Haab & Botts, 50
—New York Stock Exchange,
Leaders
lof
vs.
price
Group I. B. A. annual frolic
clay Investment Co., 39 South La Salle Street,
Texas
&
put-and-call
Club.
S.
U.
Pacific
&
Co.,
Company—Bulletin—Smith, Barney
Railway
Athletic Club
Wall Street, New York 5, N. Y.
14
Co.,
Control—Data—Raymond &
Thermo
Boston
(New York City)
Security Traders Association of
New York outing at the New York
Sept. 7, 1951
Chicago 3, 111.
148
Sept. 20, 1951 (Omaha, Neb.)
Nebraska -Iowa
Investment
State St.,
Also available is information on Thermo
9, Mass.
Bankers Annual Frolic at
'
I.
du
Pont
&
Co.,
1
Sept. 24-26,1951 (Cincinnati,Ohio)
Association of Stock Exchange
Wall Street,
Plaza Hotel.
City Bank Stocks—Comparison and analysis of 17
City Bank Stocks—Laird, Bissell & Meeds, 120
Broadway, New York 5, N. Y.
Notes
NSTA
York
Beach, Calif.)
National Security
The
subscription fee is $8.50.
SECURITY
;
TRADERS
Utility Common Stocks—Tabluation—G. A.
Co., 70 Pine Street, New York 5, N. Y.
Saxton
convention at
18th annual
&s
.Located
Calls—Booklet-r-Filer, Schmidt & Co., 30 Pine Street,
-'V/
•.
f
:
ji$e of
>
convention.
are
made for those interested in deep
Reduction—Review—Ira Haupt & Co., Ill Broadway, New
Corporation—Bulletin—Empire Na-
Co.—Memorandum—Charles A. Taggart &
;?i
Development
&
in
"High-*
lights"—Troster, Singer & Co., 74 Trinity Place, New York
6, N. Y. In the same issue will be comments on CrowellCollier, Jacob Ruppert and Talon, Inc.
•
Atlas Plywood—Bulletin—Peter P.
McDermott &
Street, New York 5, N. Y.
;
Street, New York 5, N. Y.
Brad Foote Gear
Works, Inc.—Bulletin—O. B. Motter & Asso¬
Service
Co.—Analysis—Ira Haupt &
Cooper
Tire & Rubber
Company—Analysis—Cohu
Wall Street, New York
5, N. Y.
&
Co.,
1
Products, Inc. — Memorandum
Dempsey-Tegeler &
Co., 209 South La Salle Street, Chicago 4, 111.
—
General
&
Public
Service
a
memorandum
Gra¬
5, N. Y.
Richfield Oil Corp.
on
Graham
Paige—Circular—James J. Leff
Street, New York 4, N. Y.
&
6
'
our
Are you
figure?
if you have?
our
of the bonds will
vide funds for
Brokers
Copy
on
and
Two With Keizer
74
Y.
Dealers
;
HA
2-2400.
Teletype
Private
Cleveland-Denver-Detroit-Los
wires
NY
New
Association
1-376;
377;
378
York
Louis
Stock
Exchange,
an¬
that Robert Morris Snyder
has
been
the
firm's
appointed
manager
of
Pottsville, Pa.,
office,
Schuylkill Trust Building.
John
E.
to
Ange3es-Philadelp|iia-Pittsburgh-St.
—
Cyril
and
William Vj
Wyche, Jr.
affiliated with
Keizer &
Street.
Mr.!::
Barnstone was previously with
J. Arthur Warner & Co., Inc.
Congress
19
White, Weld Adds
(Special to The Financial Chronicle)
(
Mass. —Robert A.
Thom has become associated with
White,
shire
Weld
Street.
&
He
Co.,
was
Ill Devon¬
previously
with Investment Research Corp.
with the firm
become
Waddell
in
its
Philadelphia
office, 1528 Walnut Street.
& Reed,
BOSTON,
Mathews
Mass. —Theodore
with Edward
Co., 53 State Street.
Callichy is
now
R.
E.
Inc., Met. Bank
Building.
Joins Renyx
With State Bond & Mtge.
(Special
associated
(Special to The Financial Chronicle)
(Special to The Financial Chronicle)
MINNEAPOLIS, Minn.—Charles
L. Madden is now affiliated with
to The
Financial Chronicle)
Field
(Special to The Financial Chronicle)
BOSTON, Mass.—Frank J. Tibert
has become associated with Renyx,
A.
Ekberg is with State Bond &
Mortgage Co., 26!/2 North Minne¬
formerly with Edward E. Mathews
sota Street.
Co.
NEW
Pepper has
With E. E. Mathews
With, Waddell & Reed
Reynolds & Co., members of the
Trinity Place, New York 6, N. Y.
Telephone:
now
Co.,
Advertising Committee
Pershing & Co.
120 Broadway, New York 5, N. Y.
■
Changes in Penn.
Dealers
Request
Security
Mass.
BOSTON,
Barnstone
BOSTON,
Reynolds Announces
Troster, Singer & Co.
N.
made
(Special to The Financial Chronicle)
HAROLD B. SMITH, Chairman
nounce
Members:
expenditures
for
treasury
K. I. M.
Jacob Ruppert
Banks,
expansion of facili¬
company's
on
Talon, Inc.
Crowell-Collier
For
comments
from the sale j
be used to pro¬
for this purpose.
adequately credited with advertising in the above
Can you sell an ad if you haven't yet, and more
v
interesting
interest.
The net proceeds
NSTA
Our next "HIGHLIGHTS" will include
prices
accrued
appreciation to those who actively assist, and
\
Associated Dev. & Research
;
ranging from 105% to;
100%, plus accrued interest; also]
through the sinking fund, begin- '
ning Feb. 1, 1955, at prices rang- (
Jng from 101.83% to 100%, plus
at
are
gross
notice
part, on 30 days'
in
gross
greet with enthusiasm the "Chronicle" solicitors, Messrs. Beck,
Murphy, Reilly and Gray, who for many years have been re¬
sponsible for the success we have enjoyed with our Convention
issue of the "Commercial & Financial Chronicle."
Co., Inc., 50 Broad
or
be redeemed, ^
bonds may
These
all
&
Stuart
ties and reimburse the
Let's show
Corp.—Analysis—Spiegelberg, Feuer
Brewing Co.—Memorandum—Hemphill,
Noyes,
ham, Parsons & Co., 15 Broad Street, New York
Also available is
*
treasury?
Co., 30 Broad Street, New York 4, N. Y.
Goebel
,-/•
Committee is proud to report that
advertising was over $11,200. This early
return proves that many of our members have demonstrated their
support to our Committee.
Are YOU among those who are doing their share in this
effort which means so much to the NSTA and which, with the
aid of but a few local members, could swell your own affiliate's
of Aug
Co. Inc., onj
Aug. 8 publicly offered $15,000,000
Michigan
Consolidated Gas Co. ?
first mortgage bonds, 3*2% series,
due
1976, at 102% and accrued
interest, to yield about 3.38%. The"
group was awarded the issue at
competitive sale on Aug. 7.
Coronado,
Your National Advertising
as
Co., Ill Broadway, New York 6, N. Y.
Doeskin
Del
LIBBING
AD
ciates, 500 Fifth Avenue, New York
18, N. Y.
Public
the Hotel
M. A. Cayne,
Audio Devices,
Inc.—Analysis—Peter Morgan & Co., 31 Nassau
Vermont
rates at
Registration and hotel reservation forms should be sent to
Cayne & Co., Cleveland, NSTA Secretary, together
with a covering check for the registration fee. Hotel reservations
cannot be confirmed without the required form and payment.
-.v.
Central
plan
will be informal.
tions
Co., 44 Wall
,
which in¬
cludes breakfast, luncheon and dinner, will be $26 per day for two
in a twin or double bedroom and $18 per day for a single room.
Mild weather may be expected during the day and cool evenings. Spcrt clothes and medium weight apparel are suggested
for day wear and light wraps for evening.
All convention func¬
American
Research—Comments
sessions,
released in late August or early September.;^
Co.,, 1500 Walnut Street, Philadelphia 2, Pa.
Associated
sea
golf tournament and
business
regular
Street, New York 5, N. Y.
American Express
a
headed by
,A banking syndicate
Halsey,
completed, it will
a trip to Mexico.
Aside frdm the
the municipal and corporate forums
will present
outstanding speakers who have been invited to
address our meetings. The complete convention program will be
feature
American Communications
tional Corp., 37 Wall
.
and arrangements can be
fishing. <-v\
While the convention program has not been
York 6, N. Y.
•
Halsey, Stuart Group §
Offers Utility Bonds I
,
has been made for golfers at two courses
•
>
wood Beach Hotel.
salt water pool, championship tennis courts and a putting
among things available on the hotel grounds. Provision
a
tcourse
r
Del Coronado oh-.
Ocean swimming or
the bay from San Diego,.the
across
Holly-
Annual Convention at the
Sunday evening, Sept. 30 and continue until Thursday,
on
fers everything for a successful
New York 5, N. Y.
Air
ASSOCIATION
Association, Inc., will open the
Hotel Del Coronado, Coronado Beach,
Oct. 4.
Public
1951 (Hollywood
Beach, Fla.)
,1
Investment Bankers Association
.
The National Security Traders
Calif,
Day outing.
umbus
Nov. 25-30,
'
1
The
NATIONAL
years 1833,
Inc., 46 Front Street, New York 4, New York.
.
(Dallas, Tex.)
Dallas Bond Club annual Col-:
Sports scheduled for the day are golf, tennis,
Island, New York.
.V
ti
v
.,
Oct. 12, 1951
Security Traders Association of New York will hold their
New York Athletic Club, Travers
horsehoes and softball.
119 years ago, and its stockholders have
dividends regularly with the exception of
1840 and 1858—National Quotation Bureau,
*
NEW YORK
OF
fall outing Friday, Sept. 7, at the
paying dividends
«
ASSOCIATION
"
Twenty-three of the
companies have been paying dividends continuously from
seven to seventy-nine years. Of the other
twelve, one started
Puts &
TRADERS
SECURITY
'
v;
,
Of the 35 companies
represented in the National Quotation
Bureau's Over-the-Counter Industrial Stock
Index, 12 trace
their ancestry to years before the Civil War and another nine
had their beginnings in 1900 or earlier.
the
]
ronado Hotel.
stocks used in the National Quotation Bureau. Averages, both
as to yield and market
performance over a 12V2-year period.
annual
Traders A»-;
sociation Convention opens at Co-
Dow-Jongs Averages and the 35 over-the-counter industrial
received
(Coronado
Sept. 30-Oct. 4, 1951
Over-the-Counter Index—Booklet showing an up-to-date com¬
parison between the listed industrial stocks used in the
„
Meeting at the Terrace-
Firms Fall
New York
-
Sep¬
Hotel,
Blackstone
at
Omaha.
New York 5, N. Y.
New
19
tember
New York 5, N. Y.
Laggards—Market opportunities suggested by study
trends—Francis
Omaha
Country Club. Cocktail party
Dividends
Cash
and
outing at the Park Hill Country ?
Company—Analysis—Bar¬
Texas Illinois Natural Gas Pipeline
Broadway, New York 4,
Stocks and
Bond
Denver
Corporation—Memorandum—Hayden, Stone &
King Ry.
Common
(Denver, Colo.)
Club-Rocky Mt.
Aug. 24, 1951
Co., 25 Broad Street, New York 4, N. Y.
New York.
Investment Facts About
Dealers
Securities
Association "Fling Ding" at the
Mauh-Nah-Tee-See Country Club, j
Company—Analysis—Eastman, Dillon & Co.,
Broad Street, New York 5, N. Y.
15
.
"Information Please!"—Brochure
explaining about
Lerner Be
Paper
Regis
Struthers Wells
virtually every active stock on the
Exchanges—single copy $10.00;
yearly (6 revised issues) $50.00—special offer of three edi¬
tions of Graphic
Stocks, 1924 through 1935; 1936 through 1947
and up-to-date current
edition, all for $25.00—F. W. Stephen!,
15 William
Street, New York 5, N. Y.
York
—
Falls Machine Co.
Graphic Stocks—January issue contains large, clear reproduc¬
tions of 1,001 charts
complete with dividend records for the
full year of
1950, showing monthly highs, lows, earning!,
New
Card memorandum
Co., 10 Post Office Square, Boston 9, Mass. Also available i*
a memorandum on Gear Grinding Machine Co. and on Seneca
5, N. Y.
capitalizations, volume
—
(Rockford, 111.)
Aug. 23, 1951
Rockford
Cement Company
Riverside
Field
Investment
In
& Co.,
#
•
Purolator
following literatures
& Co.,
EVENTS
and analysis—Holton, Hull
210 Seventh Street, Los Angeles 14, Calif.
Milliron's
Thursday, August 9, 1951
.
.
Securities Corp.,
Broadway, New York 5, N. Y.
120
l'
is understood that the firm$ mentioned will be pleaued
.
Broadway, New York 4, N. Y.
Mclntyre Porcupine Mines, Ltd.—Study—Suttro Bros.
Recommendations and Literature
Chronicle
ULM,
Minn.—David
Field
&
Company,
Inc.
He was
Volume 174
Number 5036
.
.
The Commercial and Financial Chronicle
,
(509)
NATIONAL
STEEL
t
'Major divisions of national
steel
WEIRTON STEEL COMPANY. Mills at
Men and mills of Weirton
part
Steel Company are an important
of National Steel's productive might
Weirton,
West Virginia, and Steubenville, Ohio. World's
largest independent manufacturer of tin plate.
Producer of a wide range of other important
steel products.
GREAT
LAKES STEEL CORPORATION, Detroit;
Michigan. The only integrated steel mill in the
Detroit
Weirton Steel
Company,
one
of the
two
major steel-producing divisions of National
Steel, is the world's largest independent manufacturer of tin plate for the billions
of tin
cans
America
uses
each year.
Its record of contributions
Weirton
metals
process
a
proud
Produces
a
wide range of carbon
major supplier of all
of steel for the automotive industry.
types
...
is
a
DIVISION.
Unit of Great Lakes
Steel Corporation. Plants at Ecoirse,
one.
of coating steel with protective
Michigan,
and Terre Haute, Indiana. Exclusive manufac¬
of
turer
world-famed
Quonset
buildings and
Stran-Steel nai I able framing.
today operates the largest and fastest electrolytic lines in the industry.
Weirton installed
many
Weirton is
area.
products
STRAN-STEEL
improved steel-making methods is
helped develop the electrolytic
...
pioneered
hearth
to
steel
an
the world's first
other improvements
fully continuous 4-high hot strip mill
now
.
.
.
standard in modern steel-making practice.
integrated, versatile Steel producer—from blast furnace and
HANNA IRON ORE COMPANY,
Produces
Lakes
ore
region. National Steel is also participat¬
ing in the development of
open
iron
Cleveland, Ohio.
from extensive holdings in Great
ore
new
Labrador-Quebec
fields.
operations through complete rolling and finishing in its mills. Its products
include
a
wide diversity
of finished steels used by practically all of the nation's
THE
HANNA
FURNACE
CORPORATION.
furnace division located in
Blast
Buffalo, New York.
manufacturing industries.
Weirton Steel is
growing
among
one
of the
seven
principal subsidiaries of National Steel, fastest
America's large producers of steel.
NATIONAL STEEL
GRANT BUILDING
fT* CORPORATION
WW
NATIONAL
and
in
NATIONAL STEEL PRODUCTS COMPANY, Houston,
Recently erected
warehouse, built by
the Stran-Steel Division, covers 208,425 square
feet. Provides facilities for
distribution of steel
products throughout Southwest.
SERVING
AMERICA
BY
S E R VI N G
AM E R I C A N
Coal mines
Pennsylvania, West Vir¬
ginia and Kentucky. Supplies high grade metal¬
lurgical coal for National's tremendous needs.
Texas.
PITTSBURGH, PA.
MINES CORPORATION.
properties
INDUSTRY
9
10
The Commercial and Financial Chronicle
(510)
ing claims, such as life insurance
premiums, bills for partial-payment
stock-purchase plans, and
Perspective for Investors
FERGUSON
By DONALD G.
Survey, Cambridge, Mass.
Conservative Investors
problems in preparing
Investment counsellor reviews
ment
Stresses
program.
balance in
an
extra
with
more
it
as
and
be
to
his
of
part
can
usually be ascertained
without difficulty. When the fundis small, the portion held as se-
grows, and they are
part
of
the
fund's
- curities
can
be analyzed with
basic analysis needed to little difficulty and without much
assure the adoption of a properly time-consuming effort. The probintegrated investment pian is the lem becomes more difficult as its
of
the
investor's value becomes greater, because
probable future cir- progressive taxes make necessaryj
earnings the acquisition of a much more
regarding
examination
present
and
cumstances
more
and
family
deter- varied list of holdings,
These
needs.
mine the amount and type of in-
probability of continued
on a generous basis is not
the
returns
value
continue
appraised
than
other
items
of
wealth because its returns are exin dollars, and its sale
The
high-yield issues that can be obtamed on such a basis solely because
will
considered
The temptation here is to
fund
ment
pressed
structure.
-much
as
worry
equity he holds in his home, some
cash value of his insurance policies, and a savings account. These
fund
are
dilute the strength of the invest-
Concludes investor can delegate judgment
but he cannot shift his own
.■v.responsibility.
liquidity.
investors
prices.
investment fund. Discusses
principles of diversifica¬
others in selecting investments,
to
entail
yields that do not provide- adequate incomes as others
do over fluctuations in security
factors in seleciion of securities and
tion and
that
nevertheless
,
low
■over
individual's needs and circumstances, and
of achieving a proper
that
Some
shaping of program to each
describes problems
proper
devices
charges
worthwhile in such cases.
invest¬
an
similar
Thursday, August 9, 1951
Securities
he should have and can
Here is decided the disci-
of
surance
dences
buy.
evidences
defined
are
debt,
evi-
as
bonds, and
of ownership in propor
'
too bright. In these cases, the ininvented
a
way
to
hunt
the vestor may in some cases contain vestor has to strive for an objecaurochs and let his brethren in on speculative issues, but these are tive attitude. It is so easy to bethe secret
he became an expert, included as a calculated risk with lieve what has a pleasant sound
offsetting safeguards not found in and reject the counsel that deBeing human,
the operations of the casual in- mands
sacrifice as the price of
or nearenough
dulger in "flyers."
prudence. The struggle is the inhuman to have
When the first Neanderthal man
vanities,
tion
be
":
with
his
might
better
dustry. They
there
be
carry
on
In
the
fact,
the rest of the
tribe must
Donald
without
investment
practice,
of
are aware
and
money-
This
easier and safer than making pro-
into
the
future.
At
any
rate, experts within the history of
man
have been laying down the
law
their
to
audience
■uously
discouraging
critical
thought by
t
Investment
advancing
the
to
their
be
to
prone
to fall into the
of
They
are
of in-
way
than
no
gospel
as
questioned.
ier
rather
bv
habit
ideas
never
structing
else.
are
suggesting
*
■
This practice is hazardous
0avill~0
L11C
often
information
•economic
auvwcia
have
or
n0(
readers'
their
readers'
look
on
two
factors
life.
none
are
there
cause
is
all-purpose
ideal
no
these latter
any
style
as
,....
Investment
bdviee
is
omy
„,
is
y>
.
—v4yv,,
ompetitive,
^
have
_
be
to
like
result of careful nurture.
Pnn*ktPntlv
onH
yertising. People having small
large
amounts
wide
choice
sale
invest
to
of advice
whaf
in
advice
the fund
to
much of the advice must be
wrong
and therefore must be
carefully
hv
thp
nn
on
and
char-
the
teke
a
widow's
Whpn
special
of
windfall* in
immcw,
be judged
•;
fund
The
judgment
through
through thl
the
'
entirely invested
as
especially harmful to the
conservative investor re¬
quiring a reasonable income from
been
average
been the major factor
reducing interest rates generally on all obligations. The
downward trend of interest rates
has been halted, and a slightly
in
be
can
resort
may
lliaj
loan
as
vaiue
policies., To
insurance
firmer
^
0f
these
be added corporate bonds of
When
an estate is appraised for
inheritance-tax p u r p o s e s. the
The
portion
fund
Infn^'ennsi'derl
of
*-
"
Tation"
This
investments
-
caps
callS
th
mav
may
in
investor
mind
.
yheavv
be
De
made
maae
his
nis
trrnnnr)
servative
.
Doint*
and
one
investor
probable
tn
thp
aq
survivor
in
xigin
,
tha
the
mn*t
process
of natural selection.
The conservn+ivp
quite
vague
so
a
+
eoSeent L
thp rnp^
gentle reader " because
bers
of this class have a eprtain
definite attitude in common
Thev
i.nni
iU..
£
treat their
rather
Thev
than
pursue
their
as
able
in.
a*
as
a
.
in
a
casual
their
whole
to
limitations still
■siderable latitude in
investments
and
should be used in
XL
•
xne
maividuai s
J
•
♦
q
J
,
,
nniip,!
nprmif
investmpnt
in
suit-
objectives
allow
the
LIIC
AA
of
manner
and
its
s
systematic
rnn*i*tpnt
see
a
relation
These
i
circumstances
They try to
program
3
funds
enn-
eeleetien
OCICLti(JH
this
latitude
seenrH.npp
accoraance with
,
requirements. The
ux
me
iiivcstux
s
cige,
etuii-
This
the
investment
an
for
a
has
termed
been
case,
properly
definite
in**p*
pos-
*iiffprpd
when
unsuitable
for( them.
Others
uon
petus of the imaginative appeal; it
oversimplification,
a
'—i'-—"
—
"
the
main
design
is
ui
a
laxge
that
the
past.
sometimes
v
in-
the
take a sentimental attitude toward vestw's responsibility^
r
.-.
tbeir Det investment holdings and
»'.*-•
;
wil1 cling fondly to an issue over
Building a Fund
years of continued disappointment
The task of building a rational
as a
will ^ her profligate investment fund is usually a reson-
I' is not generally realized
i
♦
■«.
•
1
i
modelling job, in actual fact, bexi
i
*
x^
J__
T
markets
as ef-
as
corporations quite
refunded their debt at
means
in
c-T--
v
pan
but
out
like
eagy
stock Prices that holdings of any conceived. The details can be
but stable nreferred stock issues filled in with the help of others,
arb
wiped
scllux
vl
uiu
bee". accuniujated unless the m* people's savings. This is a favorthe addttaonal tm- able development in itself, since
torced-saie
nnv
the substantial
more
persons
are
inherent • in purchases having adopting more adequate life insome sPeculative elements.
surance programs than there were
fund
tuna
prices must be accepted.
of
what
or
tion °f bonds and a compleOnce the investor has a com- mentary^; proportion
of stocks.
stanc^s and still lead a^ faulty ap- prehensive picture in his mind of Balance requires a much more
proach to a program if his attitude what assets' he has to build on, considered judgment than this. In
of mind is ignored^ Here, the in- he is in a position to think about 9
to ,achieYe. 11 "?■;: lA
vestor has to get to work on an the amount and type of assets he-due regard must be paid t° tbe
objective appraisal of himself.
needS) W9nts, and has a reasonable investors resources of_ all,kinds,
Some people worry so much chance of obtaining. The major including all his wo:rldlv poss sover day to-day fluctuations in outline of his plan can then be sions and his mental endowm
*+r»plr
nripp* that
Vinlrlincf*
nf
pnnppi\7Prl
Thp
Hptail*
hp
Weil.
in2s prospect, and other tangible
and readily : discernible circum-
feature
represented
middle class of the bond
1U1IUS, yv^uiu
emergency
on
on
be
might
valuable
a
and
such as annuities, savings ing are available on a 2% to 3%
«* ^
an
Qmust
the
was
list
his
the education of .the lower interest rates obtainfor old-age retire- able. In spite, of the recent fracment is usually accumulated and tional increase-in basic interest
^ ^
^
f
^ fixed obliga- rates, issues of comparable stand-
objective
with the quali-
the
constantly
VjL
-
applied to building
as
of
provide
t°
tlons,
investment fund
F
agance.
niw*S
prescribed is the amount that
sonable
be anticipated m
foreseeable future.
is an invitation to extrav- fectively as if the destruction had
y
..
, .,
been planned, which of course is
cases
ovni„ei,,0
avninoh^
taten
but
—
moderate
A quarter of a century ago, the
conservative investor's list contained a solid section of well-protected,
better-grade
corporate
bonds yielding 5 or 5y2% return!
Checking account deposits in ex-
..
developed,
very
a
can
readily
the
—
than
a
recovery
UU11UU
has
trend
more
no
in reality, as much attention cess 0f those usually needed to
be -given *° acbievl"g praper meet current expenses are eligibalance, "? a^nvestmcnt fund as ble for inclusion in this part of
?«
drastic change during the past
decades.
This
change has
a
•
0[,in*0
that is,
interest
basis has
fund
emergency
last
a
hfe
_
,noi
x^i
bonds,
stated
two
On
insurance
radical
de-
a
rate and maturity, has undergone
held in the form of savings bank
deposits, savings and
loan accounts, Government bonds, and,
?a^ed conservative.^ Midway in
keen
.
Temperament
The
suffers
Bonds
supply of
obligations with
veloped.
railroad common stocks was
ln
misfortune
care
hy individual preference for adventure or security!
'
manifestly to the conclusion that
weighed
test
ease*
cases
a pleasant one and can
leads
list
fund. The pressure exerted
siderations;
for,
without
such by the Federal Government to
provision, the whole plan may keep interest rates low enough to
be wrecked before it has de- service its huge debt on a 2%
^nHces"
ssf
'much
Tj
r
hnilrHna
make'''
Lntin«pnniPc
prom-
ThJ?
"
S
diversity
strable
+u"
ooov,
toeether
'of
Dianned
immutably
common-stock
be given priority over other con- his
rf^children
a
offered for
ranging from implied
scrape
acter
or
have
the
The
n«
make 'demands
Such
Vpars
vears.
claims
cline in quoted value,
in every phase of the proportions held in specific types
investment problem, it is vital to of securities. It does mean an arhave the owner himself give it rangement of assets of kinds dehis attention, to think about it.
signed to fulfill the individual's
requirements under normal cirThe Conservative Investor
cumstances and also to provide
The term "conservative inves- for emergencies. Where possible,
tor" is no longer a monopoly of provision for emergencies must
funds that may set back a Pro" value of all the assets—cash, bank
ofsneh
accumulation
by
several
accounts,
insurance,
securities
tpst
the
rhar-
vxitnto
and clients
through ad-
obtained
tn
<jc
sometimes
eenn
capacity
preferred
remain
of the
portion
investment fund
an
£
IS i? exerted in analysis and selec- the fund, but this form of holding
a savings fund duiing their tion of the component securities, brings no income and in many
„a y
nnv
moderrf
while
as
opposlte directlon-
people to tell about them.
other service in the
Balance in
will
Iixed
.
.
0
perfects"1
or
its
exception of Government is-
sues)
with the character of its the century such a fund is justly sufficiently high grade to guarp0sAs®ss0fm,oc,
termed speculative., The earlier antee a permanent market firm
S
2 iIt aPPJalsal P^ed fo be wrong, but enough to obviate the need to
rhtlxrilr S whPthpr
?GS
follow that today s take more than a mindr loss from
°Plnl(^ is equally at fault in the the purchase price at any time,
recom-
in
with declining earnings,]
though at a more moderate
Therefore, the conservative
eral
Balance
™
to the individual s con-
r
than there
more
investments
scru-
i
»
Prn(rr(ini
the person who buys nothing more
anaping uie nogram
^speculative than triple A bonds,
Tbe. conservative investor can- if the Conservative Investors Club
not pick his Pr°gram ready-made were so limited, few people who
?ff the
.not
7 *Las
dePend on returns from securities
f care^u^^ custom-made, but it for income could afford to belong.
?
mu^ bave frequent altera- The concept of the conservative
f1(JnS} and
?.n- ^^ve Investor changes with the years,
intereSt
all fittings. It should At the beginning of this century,
conform to the current
important, be-vjf
such thing as
investment
mendations
are
general out-
Both of
of
„i
—
•
about
those
does not, and indeed cannot, imply a rigid composition in the
ai
little
their
about
circumstances and
as
existing holdings has to be
investment plan constructed on
program
"for the YYin
advice-takers; first, because it is ^
as
their savings, not the advisers', at
stake; and second, because the! m0I?*ze
advisers
perament can
an
same
only
earning, and the worth of its
"evidences"
employed for building a new one, rate.
but in this case an accumulation investor cannot assume that the
of sentimental attachments for value of his bonds (with the gen-
-
of
sort
anyone
adviser*
immune
means
assid-
and
any
of worry to him,
his ternbe disciplined to fit
are a source
he may consider whether
only partially effective in guiding since,
thinking
tion
jections
they
the
are
ment
of thei.r economic affairs. The cooperation of investors is needed
to consider recommendations in
the nght of their own circumstances and according to their own
judgment.
all
even
is," if
that
tinized critically.
their clients in the management
at
shrinks
tablished
problems,
f0r
in
reconstruc-
it
a
investment
are
is, of course, projection into
the unknown past which is much
about
term
valuable
js
nlnn
The nrineinles
involved
in
plan.
The
principles involved
in
overhauling a fund already es-
tho
the
prac- tested principles or whether the
interpreting the signifi- usual investment
plan
for his
cance
of price trends.
They can economic circumstances must be
assist in framing a sound invest-, modified
to '•suit
the
investor's
—i..
idea
in-
familiar
this rests the main
on
cnr-ir»lncn*t
micht
sociologist
might
normal adjustment to his
iirho*
what
ob-o
make
but
outline of the rational investment
investor
an
and can help to temperament.
Here,
again, his
keep it in operation and still be judgment must be the final one;
G. Ferguson
ac-
his
cept
a
are
conditions
ticed
to
way
hunt.
credit
a
be
to
keep abreast of developin finance, trade, and in-
ments
dangerous
has
advisers
sound
They
might
that
or
tered,
fails
to
Whenever
Qualified
affair.
cooperative
vestment
sugges¬
that
method
advice
Investment
frowning
ian,
Enterprise
Cooperative
authoritar¬
an
-on any
must be a "moving analysis" as a sound stock may be more valu-;
individual circumstances and gen- able to an investor than is a less
eral economic conditions are al- well protected bond. A property
vestor's alone.
he
became
also
pline that he will aim to impose erty, or stocks. The distinction
over his spending habits to allow between
these two investment
the accumulation of the fund categories is important but may,
through the savings margin. This be overemphasized, inasmuch as
security list of a conservative in-
...
Securities
For
practical
purposes,
r —^
,
the
the other
companies
found
hand,
have
difficult
it
to
obtain the mortgage type of seCurity they need in which to in-
vest funds to serve as reserves
to meet their; liabilities.
\
The result of these influences
has deprived the individuai inyesiQT Qf a chance to reinforce his security list with fixed obligations
without making a substantial sacTbn
:„
inxTPctpr tirith
rif ice in income. The investor with
small
a
por-
fund'can advantageously
,
.
tion of an .investor's assets held hold Government savings bonds in
in tbe form of a list of securities his security list, and the wealthy
is composed of his bond and stock
holdings. For many; perhaps the
majority of people, this is the
core
of the
*
investor
can
hold tax-exempt,well-
rrmniriDal
investment program, integrated portfolio,
xv,T:^
Unll^
bonds
in
an
protected municipal bonds in an
_
-
r*
-
but the bond
-
how many individuals are tern- cause the investor already has From this list is derived the bulk section of the average mediumPeramentally incapable of saving some kinds of assets before he of the individual's income aside §ized secUrity
irity list has been mainany
ai
JiJ
in
par|- 0f
their
incomes
except
V/JL
Uiv.ll
lliuuiuv-o
VA.V.V.^V
pail
the form
of
regularly appear-
starts
to
VU
buy
they consist of
securities,
no
more
even
v.* v.**
if
Ai
than the
salary
J
from
his
come.
Its value
or
can
business
in-
•
be more easily
Continued
on
page
30
.Volume 174
Number 5036
.
The Commercial and Financial Chronicle
.
.
(911)
at least not in
pen,
degree.
Population Trends and Investment
Professor
Economics
of
'
University
Duke
'
the significant tendency of increasing
demands.
Analyzes pension systems and says solution of
problem is in keeping-up retirement age.
pair vital
in
the
Changes in Age Composition,
Further
•
population
is
the
taking
changes
the
in
increase
number of older persons
improvements
and de¬
the result, as
pulation.
The change is
males
much
■
"
■;
ageing,
of
to
1900
in
0.2
0.55
may
be
The
causes
better
this
by
change
are
birth rate,
though reversed some¬
the
the
of
course
past
the relative
number of persons in the younger
age bracket.
This is the most im¬
portant factor up to now.
(2)
The
decline in
immigration is
second
in importance.
(3) The
decade, has reduced
a
has fallen
rate
death
crude
in the past
third
since
the
result
of
both
over
four decades.
has
decline
this
But
a
been
great
de¬
in infant and child mortal¬
crease
ity and of sharp decreases in the
age-specific death rates in the
middle and the old-age brackets,
has
and
old
added to
inal
young,
registration
states
rose
from 49.2 years
'in
about 1900 to 67.2
The expectation of life
1948.
at age 45 rose
from 24.8 years in
1900 to 28 in 1948; and the expec¬
tation at age 65 from 11.9 in 1900
to 13.4 in 1948.
It is expected that
will be added
expectation at age 65 and about
in the 1950s
to
two years
4
a
year
to expectation at age 45.
prolongation of
like
denied
factor is
attitude.
employment
will
not
be
the unions
of
three
Life
Officers
Investment
by
1951
Seminar
at
Beloit College, Befoit, Wis., June 18 and
19, 1951. The previous two lectures have
already appeared ii* "The Chronicle" of
July 19 and July 26.
are a
0.5 V
States
0.3
in line with others that have been
0.3
five
14.1 plus
made,
12.8
pressure
for early
retire-,
proposal
a
voluntary retirement, even
able-bodied, at the age of
If, however, there is un¬
that
the
pension
19,000,000
22,000,000
under 55; and much
35.2
How many aged will there be in
proved somewhat too high?
9,000,000
14,000,000
estimates of
since
our
the
not yet
are
born, and
fundamental concern
increase
the
in
is
relative
the
bargaining
question.
or
industrial
evidence in
will
unions
this
Of
the
assume
we
1930s.
that the
as
he has accumulated in
Federal
and
geriatrics,
of
Changes in
We may look
forward
when
to
time
a
as
people
effective in their
earlier in life, since greater
responsibility
many
and experience in
occupations offsets diminu¬
tion in reaction
effort
should
time, etc.
be
made
Every
to
Let
ican, unlike
some
other breeds of
men, is born to work.
His social
standing, his status, depends in
considerable degree upon his oc¬
cupation and its practice. If this
security
social
ac¬
living
mental
removed, and his
physical condition is
is
and
affected accordingly.
It is ex¬
tremely important, therefore, in a
society with the values we have
in this country, that the working
capacity of the older worker be
prolonged and enlarged by geri¬
atrics, and that industry in turn
give this worker the opportunity
to exercise his occupation.
action
of
this
sort
-
taken,
about
one-tenth
would
be if
tire
at
below
it
what
they continued to re¬
about the ages ruling in
the early 1940s.
A
ing.
third
a
,
kept employed as long as possible,
until
se¬
It should.not be
a
the
stances
the
factor is the social
so
age
if circum¬
this is done,
70
of
permit.
If
pension problem will not be
serious.
Let
us
suppose,
however, that
of
This announcement is not
In fact, every effort should
premium upon working.
put
many
workers are dis¬
charged before they have reached
the age of
the
What will be
thing, the
65 or 70.
effects?
For
one
Continued
V
on
page
-changes in age composition
offer to sell or a solicitation of an offer to buy these securities,
offering is made only by the Prospectus.
an
The
on
the economy:
(1)
Per
Upon
Affecting
Conditions
Capita
Output—The move¬
ment of per capita output depends
things,
upon many
one
the
into
those
who
ductive
and
those
who
criteria
under
15
be
pro¬
are
Michigan Consolidated Gas Company
un¬
First Mortgage
the
as
productiveness certain
of
limits,
age
are
uses
one
popu¬
may
divided
productive." If
$15,000,000
of which is
the age composition of
lation.
A
population
classify those
may
we
18
under
or
and
those
Dated
Bonds, V/i% Series Due 1976
Due
August 1, 1951
August 1,1976
aged 65 and over as unproductive.
This is only
a rough classification,
especially for those aged beyond
since
65,
Price 102% and accrued interest
considerable
number
of these still remain in the labor
force.
For example, in 1950, 31%
of those
in
a
aged 14-19
the
labor
reported
were
force
of
23%
and
those aged 65 and over.
The
The cor¬
the male
Prospectus may be obtained in any State in which this announcement is circulatedfrom only
of the undersigned and other dealers as may lawfully offer these securities in such State.
figures for
population were 25% and 42%.
But to get back to the matter of per
responding
that
the
level
ductivity
will
of per
be
capita
lower
pro¬
than
it
otherwise would have been if the
ratio of
ured
age,
productive persons, meas¬
by the number of productive
to the total population de¬
clines.
It
has
cause
a
capita
pen,
been
of
the
asserted
that
population
HIRSCH
&,
output.
This
CO.
GREGORY
R. W. PRESSPRICH & CO.
IRA HAUPT & CO.
& SON
INCORPORATED
WM. E. POLLOCK &,
CO., INC.
ILLINOIS COMPANY
AUCHINCLOSS, PARKER &. REDPATH
GREEN, ELLIS &. ANDERSON
WEEDEN
& CO.
INCORPORATED
BACHE & CO.
HELLER, BRUCE & CO.
the
will
LAIRD, BISSELL & MEEDS
decline in the level of per
given certain
HORNBLOWER & WEEKS
BEAR, STEARNS & CO.
THE
ageing
such
HALSEY, STUART &. CO. INC.
capita productivity. It may be said
could
hap¬
population
movements, but it need not hap¬
August 8, 1951
THE
a
disability upon great
made to have this system
be
examine the effects
now
us
keep
people employed until they are at
least 70 years of age. The Amer¬
Age
Composition
is
just in its infancy.
number of older persons.
Effects
or
is
(2) Upon Provision for the Sup¬
it will serve to reduce port of the Aged, With Especial
appreciably the size of the na¬ Emphasis Upon Public and Pri¬
tional income.
If 15 years from vate Financial Aspects of the Pen¬
now workers retire at the age of
sion Problem—I have already in¬
60, the national income will be dicated that the worker should be
If
count.
those who wish to continue work¬
operate to displace older workers
gerontology
for
improving
curity provision.
the same rela¬ permitted to put
tionship was found among males.
It appears to be true, however,
that
the kind of pension plans
that
are
being introduced will
punitive tax, though this
is denied him, an important reason
making labor scarce and there¬
schemes his
1980
___79.6
a
a
of
benefits
2000.:--.-.
life
would
is
60.)
employment, some of the trade
perhaps are likely to ask
for early retirement with the idea
The
being introduced by industry are"
making employers hesitant to hire
workers near the pension age, or,
more generally, workers who are
40 years of age or older and have
lost or given up a previous job.
This report is partly borne out
by the 1950 census returns, sinceunemployment among those over
55, just over 5%, exceeds by less1
than two points the unemploy¬
ment reported among those aged
expecta¬
of
the general revenue.
A differen¬
tial wage system would help.
So
were
year ago
1.8
re¬
60s, and perhaps their 70s, as they
First, it was displaced older worker can be
industry
in the "United supported, out of his
News," and this report is pension rights and such old-age
a
industry with the
trade
much
position of the crafts
number
0.2
with
ty¬
lectures
There
the
upon
turns earmarked for this purpose.
It should not be a charge against
there
for this.
reasons
reported
those in the younger age groups,
,
last
Spengler delivered before the
of
10.0
,
and
be
borne by a special equalizing tax
as
at present
as
disregard
(I
the
by
be¬
em¬
the
So long
employment
he is beyond a certain age,' groups in
this seems to be happening" had some
0.5
since these
life; for these diseases tend to imthe
is
pensionees is
unions
Diabetes
I shall not attempt
phoid, of course, has contributed
indirectly to the prolongation of
Prof.
50
9.8
1940_____.
improvement in medicine
than of improvement in environ¬
ment and of the elimination of
sources of infection.
The virtual
diseases
0
1960_____.
of
is
he
second
full
of
The argument
must be made
contingent, for it makes no dif¬
ference how productive a man is,
is
should
cost
will be about
upon
'•
skillfully.
increasingly.
ing numbers aged 65 and over:
has been due largely to the
of
■*
We shall have at least the follow¬
reduction
*This
run
of
made by the United Mine Workers
that pensions become applicable
per
subsidy
a
the
inflation.
ment.
capita so long as our business and
labor and political leadership is
intelligent and our economy is
If
then
ployed,
younger
the treatment of older persons,
from
that
Tuberculosis
have
great improvement pro¬
expectation of life up
elimination
—
Age'-
the basis of
mortality estimates which already
improvement has been the result
less
they
number
cause
the United States, on
in the incidence
of death among infants, children,
and those in early adulthood.
The
great
that it is unlikely
will
diminish
output
merely
workers.
always
are
than
depresses
probably
accentuate the forces making for
there
pective changes in the age com¬
position of the population will
increase
output per, capita, but
productive
of
observed
very high.
This factor
French incomes and will
pros¬
Accidents
;
duced in the
now
at
_
,
tion
affects the age structure most.
to
be
.
Resulting
life will become the factor which
The
expectancy
that the
1.7
All
future the
In the
for
1.8
the number of
it has yet greatly
modified the age structure.
The
upshot has been a marked in¬
crease
in the expectation of life
at birth and also at higher ages.
For
example, the expecta¬
tion of life at birth in the orig¬
and
got
tion that older workers
less
based
assump¬
keep in mind is that the science
is
I shall not argue
if
,v
Cancer
and
1960.
(1) the decline in the
in
life
Cardio-vascular-renal
from
1950
in
0.45
or
of
rose
three-fold:
what
the
Co.,
diseases
of death. How
..■
„
course
white
with
now,
Disease—
since the time of
War; it may ' rise to
37-38 by the year 2000.
The ratio,
persons
60 and over, . children
0-14, which is a rough index of
Civil
the
1948, the
Age
50%
by
longer be
In
Joseph J. Spengler
has
1940,
the
so
' Years Added to
v-'vLife Expectancy
j
pared with 29
in
I
being
not-too-sound
relative
be
can
re¬
'
'
risen
and
prolonged?
in
com¬
as
results
sometimes
the
French employments in which the
A
various
would
the
are
union
ceased to be causes
of
30.1
1950
greatly affect the rele¬
portion of the age pyramid.)
output per capita:
Life Insurance
that
suppose
pulation,
po
about
not
These
early
dation
upon
in
tirement
population
107
us
Metropolitan
me¬
age
Let
the
of
106
among
unem¬
It has been proposed that
em-(
ployers who employ older work-*
ers be subsidized, this recommen¬
last resort type of measure.;
The important point we must
1980
life
of
The evils of
job,
2000
65.5 at birth and 22.4 at
was
50.
age
signified
by the fact
dian
movement
the
lon¬
in
a
expectation of
probability
age
on
about because of
such.
as
companies, as well
similarly engaged, is
that
and
the
other
continuing im¬
the
physical en¬
of
•
off
101
no
the
crease
100
infection,
in
vironment
p o
the
dis¬
they were so largely
past,
provement
in the
American
that
the
in
weighty social obligations of
devising of private pension
plans that do not operate to in¬
far
findings, since the changes in
in medicine, surg¬
of
of the
one
insurance
1960
They will thus
on.
of
younger
persons
control
ery,
relative
number
come
so
opinion,
my
of others
1940
improvements
gevity will
the
in
crease
place
relative
off
are
so
to
as
the
(Remember
my
will
the
to
Census.
unem¬
- they
are
ployment among older workers.
composition, If they do not do this, it would be
but not sufficiently off to "impair better for the government to do
vant
resistant
less
the
by the Bu¬
total population of the future is
troubles.
significant
most
the
of
much
ease
Together With Their Effects
*
One
as
slightly
pen¬
of
victim
recovered
the
of
In
most
composition
concerned,
and often make
organs
carry
him.
the basis of
I then applied the indices I
forecast
the
of
far as the plans
permit a worker
his pension rights with
not such
worked out to the changes in age
as
sion
.
on
ranks
accentuated in
productivity of employed
classified
the
ployed; and this tendency will be
employment
to
that these forecasts
effect of increasing marriages on housing and consumer
notes
in which I took account
keep displaced older work¬
in
ers
are
the
reau
numbers of older persons. Contends larger proportion of old
people need not diminish output per capita, if business, labor,
and political leadership is intelligent and our economy is run
skillfully. Sees need of keeping older people employed and
t
and to
in
age.
Spengier, in concluding his population analysis, discusses
social effects of changes in the age com¬
significant
a
study several
a
with age of worker and variations
workers
i
the economic and
position, particularly
made
of both variations in
Business Administration,
and
'
Dr.
years ago
J.IsPENGLER*
By JOSEPH
I
11
ROBINSON-HUMPHREY COMPANY, INC.
20
J2
The Commercial and Financial Chronicle
(512)
New Economic Controls Act—
A
Fairly Good Bill
.
Thursday, August 9, 1951
.
Alfred S. Greighton
From
Washington
Ahead
By EMERSON P. SCHMIDT*
.
Economic Research Director, Chamber of Commerce of U. S.
Joins Prescott & Co.
of the News
By CARLISLE BARGERON
Dr. Schmidt contends
recently enacted Economic Controls Act
defense
There
production.
vides for higher
to foster and
power
ought to
be a more searching analysis of the Eisen¬
movement than it is likely to get.
Already
being showered with smear propaganda for even
raising their voices. Opponents in the Republican ranks are being
channel
Deplores President's statement law pro¬
gives Administration adequate
President
hower for
critics
its
profits to business.
are
depicted
The
economic controls bill
new
respect it is inflationary. This is
undesirable Congressional in¬
31,
fairly
a
good
banks
serve
now
It
quate
gives
power
maximum powers to
artificial
from
levels.
foster
and
listic
de¬
Voluntary Credit Restraint Pro¬
gram will also have to carry a
to
fense
produc¬
cussions
.
months
the
for
which
inflation,
is unfortunate
bill
the
of
does
wi h
reduce
Economic
the
ask
cannot
would
many
not
a
bit of economics which
in the Administration have
yet learned, but it is
damental
economic
individuals
who
truth
really
fun¬
a
and
all
want
to
in
and
it
production.
Joseph J. Lann Sees.
Formed in New York
Announcement is made of the
reason to believe
existing controls have al¬ formation of Joseph J. Lann Se¬
ready reduced production. Prom curities, Inc., with offices at 37
June 1950 to January of this year Wall Street, New York City, to
the
business formerly
the
Federal
Reserve
index
of continue
physical production jumped from conducted by Joseph J. Lann as
There is some
to
221,
since
but
January,
when these controls were put into
effect, the index has remained al¬
most stationary.
v:\
trated
he
by
has
heaping
been
frus¬
sole proprietor.
McGuire, Cornhoff
controls
upon
(Special
Business Position
Unfortunately,
v
releases
news
per,
government
and
some
newspa¬
radio and television comment
have
during
the
hearings
Cornhoff
Guire
Distorted
put
businessman
business
and
control
transaction
every
from
Wash¬
ington,
are made to appear as the
ones to favor lower prices.
olily
This
is
serious
a
motivations,
should
and
be
and
distortion
of
effort
every
made
by businessmen
spokesmen
to
show
their
clearly that opposition to such di¬
rect
controls
price
as
controls
and
have
Donald
become
E.
Mc¬
for¬
were
Janisen
have
added to the staff of Paul
been
C. Ru¬
dolph & Company, 127 Montgom¬
ery
Street.
With First Securities Co.
(Special to The Financial Chronicle)
KANSAS
W.
CITY,
Brown has
Mo. —Robert
become
tened
to
They
hundreds
labored
of
hard
lis¬
witnesses.
and
to
Inevit¬
develop .this legislation.
ably,
it
represents
compromise
-
and
,
no
one
is
wholly. satisfied
with the final result.
be
expected.
-
That
was
4
'
.
■
The
bill
does
credit controls
1
"Reprinted
weekly
merce
from
relax
and
(Special to The Financial Chronicle)
to
W.
Hill
and
True
Hale
are
in
"Business
Joins
!
with
this
one
Action,"
a
from the Chamber of Com¬
of the United
Sia(e«;, Aug.
4, 1951.
whether the
the
Not
added
P.
are
caused
situation
now..
general
a
and
to
se¬
specialize
in private placement'loans, merg¬
ers, sale of companies and similar
special financial transactions.
Gollron, Russell
fact
Adds Six to Staff
CLEVELAND, Ohio
— Gottron,
Union Commerce
Building, members of the Midwest
Russell
Stock
&
Co.,
Exchange,
Florence
C.
that
announce
Bland,
T.
Howard
Bolger, W. J. Bushea, L. Warren
Foster, J. E. Paisley, and Warren
G.
Steffen
are
with their
firm.
associated
now
Mrs.
Bland, Mr.
the
White
House
on
Chas. Lundfelt With
McCormick & Co.
will recognize
nothing
to them if their party
not to retain their places in the scheme
(Special
to
The
CHICAGO,
a
me see
previously with Otis &
were
Co.
Lundfelt
Financial
111.
has
Chronicle)
.
Charles
—
become
E.
associated
with McCormick & Co., 231 South
La Salle Street, members of the
New York and Midwest Stock Ex¬
changes.
Mr. Lundfelt
erly Chicago
th? Democratic State and local lead¬
Pollock
&
thereto
was
manager
Co.,
Inc.
with
C.
was
form¬
for Wm. E.
and
J.
prior
Devine &
(Special
LOS
He
eve
of
was
ter
&
the
further
fact
Eisenhower
Democratic
as,
that
a
Truman
renunciation
would
demoralize
West
Co.
Seventh
Street.
'
-
to The
DETROIT,
lock is
.
.
ing,
&
Financial
Chronicle)
Mich.—Kurt
associated with
now
Hague
.
Co.,
members
Penobscot
of
the
New
'
Whee-
Smith,
Build¬
York
and
Detroit
was
formerly with Watling, Ler-
on
&
Stock
Exchanges. He
Co.
With
that
politicians, Eisenhower,.seemingly has more friends,- more
Democrats,, even among Truman's cronies,
the Republican, professionals.
.
and
the candidate of-both parties
convention
Chronicle)
Smith, Hague Adds
chen
the
Financial
previously with Dean Wit¬
(Special
disaffection among Republican leaders. However,
is
admittedly more ripe for something of this
of
The
215
pany,
•
is
to
ANGELES, Calif.—Francis
J. Mitchell has become* connected
with Samuel B. Franklin & Com¬
Newhard, Cook
(Special to The Financial Chronicle)
.
;
;;V
-
k
ST
:
>
LOUIS, -Mo. — James'S.
McCoutrney,- Jr., Jjas become as¬
"
-
sociated with NewKard, Cook &
Co., Fourth & Olive, members of
the New, York and Midwest Stock
*•
,
-
-
With Samuel B. Franklin
Yet there is this flaw. The propaganda may dress Eisenhower
in holy and untouchable-clothes, but it won't, fall on. the com*Exchanges.
He
was
previously
vention delegates in Chicago; with the same impact as it would
with Merrill Lynch, Pierce, Fenin Philadelphia. "The work >vill have to be done before convenf fvner &
Beane and McCourtneytion time.-—,
~' I
•*.
; r;-%* -v '-r.
Breckenridge: & Co. -
-
Stoetzer, Faulkner & Co.,
Building, members of
-
in
means
.up
Penobscot
the Detroit Stock Exchange.
conduct
to
curities business
intimates, among the
the
to
man
It
they
even
than he does among
Mich.—Matthew
been
leaders.
sort
sional
Stoetzer, Faulkner,
has
Co.,
Grimm & Co., 231 South La Salle
Street,
assemblage and make-most-anything possible. And what makes
the story still more intriguing is the fact that among the profes-
*
DETROIT,
Marcus
staff of
report
is
as
the
the
(Special to The Financial Chronicle)
consumer
&
Foster, Mr. Paisley and Mr. Stef¬
•endorsement
King Merritt & Co., Inc.," of New
York.
Peabody
the formation of W. T.
fen
There
KANSAS CITY, Mo.—Woodrow
-f
•
Credit Curbs Needed
<
Two With King Merritt
long
a
Kidder,
announces
mind, it would be utterly impossible to work out any
strange things hap¬
pen in national politics in the past 20 years. I can't see the politi¬
cal leaders throughout the country, the State leaders, the Big
City leaders, of either party,'going for any such proposition. To
these fellows politics is a business; it is their livelihood.
Their
leaders
committees
nevertheless
of
ner
gamation of the "better elements" of both parties in mind in his
campaign of 1940 but his playing ball with certain Democratic
Bennett & Co.
Congressional
CHICAGO,
111. — Willard
T.
Grimm, formerly a general part¬
on
crats, by being assured that Eisenhower wasn't really a Re¬
publican and they would be recognized as the leaders in their
particular communities, could be weaned over to the proposition
of a joint Eisenhower movement. Wendell Wilikie had an amal¬
associated
does not mean a desire for
higher with
First Securities Co. of Kan¬
prices but rather a desire for giv¬
sas, Inc., Insurance Exchange
ing freedom to enterprises and to
Building. He was previously with
free production from unnecessary
frustrations and diversionary tac¬ McDonald, Evans & Co. and A. H.
tics.
Opens in Chicago;
„
Would, for example, the Democratic leader or leaders of
Oklahoma, graciously bow out of the picture in favor of the Re¬
publican leader or leaders there? ■
However, the story does not end there, as you learn in the
Washington salons over the cocktails and canapes. You are told
that the old crop of political leaders are dying off, or are being
pressed in practically every community by younger men demand¬
ing recognition. These younger men are not so wedded to parti¬
sanship; they have a "broader" and more "liberal" outlook than
their elders. They are not set in their ways. Above all, they are
adventurous and seekers of a new way of doing things. It is not
wholly inconceivable that enough of this type among the Demo¬
FRANCISCO, Calif.—Rob¬
ert L. Arnett, William S. George
F.
the
the
of
too.
(Special to The Financial Chronicle)
Lee
.
ers, coming along after the Republican State and local leaders
have in convention embraced the General, and embracing him,
Rudolph Adds
SAN
and
in
with
Building.
past was
trading depart¬
for Collin,-Norton & Co. J
learn that he would like
we
definitely establish it.
but
I can't for the life of
merly with Otis & Co.
Paul C.
freedoms.
"managers"
high patriotic plane are they going to
do anything to cut their own throats, which is just what they
would be doing in nominating Eisenhower on both tickets.
To
see these leaders stepping around
gingerly at their own party con¬
ventions to keep from being caught with a loser gives you an
understanding of the hazards of their trade. This being true then,
associated
Exchange. Both
one
my
of things.
Hawkins
&
Co.,
Leader
Building, members of the Midwest
Stock
fantastic
nominee wins if
Ohio —William
with
those who oppose price controls in
the position of appearing to want
higher prices, while those who
Want the power to regiment every
to The Financial Chronicle)
CLEVELAND,
General's
tickets would
is
To
them
H.
i
constitutional
our
,
there be any
concern
controls.
associated
Spitzer
General.
.
.
yet
i
Chronicle)
W. T. Grimm & Co.
of destroying the
of, if not the main
danger
such arrangement as this but I have seen some
The businessman is productionminded; he makes his income by
turnover,
the
What is more, it
military.
that one frequently
hears serious discussions in Washington political circles of the pos¬
sibility that after the Republicans have nominated Eisenhower,
should that be the case, the Democrats, meeting in their national
convention, a couple of weeks later, would do the same thing.
This talk even has it that Truman, having been kicked all around
..the lot in public opinion) might make some sort of a grand gesture
in this direction by way of getting a niche in history, or a better
one than he now seems destined for.
Such a gesture would cer¬
tainly be of magnificent proportions. It would not necessarily
be
unselfishness on Truman's part, either, the argument runs,
because he undoubtedly does not relish running against the
that
195
is
strong man.
It
not provide any
the Marxians, will be avoided.
higher profits.
It
the possibilities of
impossible straitjacket
should
encourage
more
Co.,
Creighton
ment
would be established under the rule of the
deepening of the class
struggle!, so dear to the hearts of
an
become
&
manager
both the Republican and Democratic
He would like this in order to have "unity." No longer
both
on
the
and
Mr.
party bickering, just a nation united behind
This sort of thinking should give a key to the
General's mind. At the very least, it shows a lack of understand¬
ing of our political system. It should be unnecessary to. point out
that there was "unity" in Germany under Hitler; that there is
"unity" in Russia today under Stalin. For that matter, with the
tremendous political machine which the New Deal or Fair Deal
has built up in the past 20 years, we have come dangerously
close to "unity" in this country.
The nomination of Eisenhower
Truth
one
That is
occasion
took
government bureaus putting busi¬
ness
of
From the
further inflation.
It
does
act
self..; There
tickets.
of
Profits Not Protected
The
■
party system which has long been
bulwark
■working people of this country to fight inflation should
get on this
reduce their standard
of living
bandwagon.
just to pay for the higher | profits
Then wage and price controls
this act provides for business."
will be seen to be unnecessary
business
-
v
the
that in signing the
"We
*
two
In the first place, there
the attitude of the General him-
tial
results
causes.
has
ton
Prescott
many
is danger in
the
President
said:
mination to maintain the value
Financial
The
stop, look and listen.
Carlisle Bargeron
to have the nomination
again to try to intensify and fos¬
ter the class struggle.
He
If we can balance the
and pay-as-we-go, and if
no
symptoms and
the
not
but
deal
the
th
of the
to
TOLEDO, O.—Alfred S. Creigh-
angles to this Eisenhower for President
movement
the American
people had better
dollar, and thereby encourage
savings, there can be no substan¬
i
w
Dr. E. P. Schmidt
because
Creighton
1
(Special
will
Because of this and
budget
there is
further credit creation, both of
of wage and which res ore the people's, confi¬
price controls dence in the government's deter¬
It does pro¬
continuation
A. S.
'
*
other
.
vide
it
sinister
I
a
few
come.
be, in the propaganda over¬
tones, unpatriotic and un-American to be op¬
posed to the General.
t v
'ho
heavier load.
tion.,
smoke-filled
are
being represented as
plottings is significant of what is to
am
reasonably certain
that within
support at unrea¬
It means that the
channel
closed,
and this is certainly as it should
be.
the fact that such meetings and such dis¬
But
restrain cred¬
the
Adminis¬ it expansion and to continue to
tration
ade¬ free the government bond market
bill.
in
know
their
exercise
meeting
plotting ways and means of ruining
the General's reputation.
That there has been
some
serious getting together of Republican
heads to discuss the situation, I happen to
by the President on July
just in time to prevent the tervention in central banking pol¬
lapse of the 30-day extension of icy. This makes it all the more
the old act, is important that the Federal
Re¬
signed
as
and
rooms
an
....
-
-
Volume 174
4
'
.
.
Number 5036
;
;
;
The Commercial and Financial Chronicle
'
,
(513)
3.2
From
Scarcity to Abundance in
billion
Oct.
in
Mrs.
Hirsch
in current
examines
levels in spite of the expected
houses
next
than
last
support'
Oct.
will
exports
year's.
be
be
larger
Unfortunately,
that fat and oil
large as last
as
oil production
Cottonseed
other
in
will
I
year,
there is little hope
next year and
large supply of hogs, as well as poultry, indicat¬
ing lower prices ahead. Says sugar crops are much larger than
prewar.
Looks for tight wool market, despite increased pro¬
duction.
for
and soybeans. Stocks of
price
fats and oils in factories and ware¬
conditions and prospects of various
Predicts all-time peak of cattle herds
year.
has
countries
increased
too; so has the lard output; Man¬
Calls U. S. "food provider of the world."
churia has. stepped up
Our agricultural
the midst of
situation
changing
rpIoflTFCi
iio-hfunnn
relative
abundance
f
^
tightness
of
again.
is
from
in
the
to
year
Already prices
most
or
would
not
way
were
it
for
the
of
the
prop
Government
Support
ProEven
giram.
the
so,
tion
situa-
of
plen-
titude
i
ahead
expressed
s
in
the
lower
prices of most
J
/-
j
1
ti
we
1
Ar 1
1951,
million bushels.
395
Our
feed
the
on
distant
more
grain
if
crops,
animal
numbers.
in,
cattle
herds
the demand
to
..
country
the
Korean
consumer-hi
to
and
abroad
War
had
After
started
a
large anticipatory demand rushed
into
markets of only normal
nlies
and
for
so
whilp
a
'there
supit
Cattle
of
Most,
important,
if
as
Actually
a^es
numbers
have
animal
been
increasing
-
-
paSedffhe
S.
Farm
All-Time
an
.This
Production
year
J ^or
to
Reach
Peak
the
*
first
time,
our
agricultural
production
rise
beyond
height
tion
rose
spite
of
*
will
carry-over of corn
next Oct.
somewhere
ago,
between
million bushels
probably
750
775
and
Nevertheless,
in view of our large
holdings
animal
year
this
rwtr
narrv
noidings, this carry-over
1S smaller than could be wished,
as " stiI1 mak<*
too dependent
each year's
cron
of* smalier
wartime
increased
demand,
8-10% higher
than last year. Prices are below
possible ceiling but at the year's
low,:, though
—v
as
down
in
£ver
.
-—
~
usual at this time of the
September.)
since
increasing
T,
«v
they undoubtedly will
year;
only about 100
or
.
1948
our
,
our
increase
corn
corn
croPs
have
cattle
beef
been
herds.
t suow
UD
;n
inis, so tar, aia not snow up in
increased beef production. On the
animals
t
are
being
held
contraiy, animals are being heia
back
breeding purposes and
calves that would normally have
acre-
are
labor
due primarily to
is
the
normal tor such a size ot hera.
ahead,
if the
price
incen-
corTstfains
Q
cotton
unhamnered
croD
idle machinery, underutilized
tion will probably not exceed 10
hales and exports 5-5Vz
million bales. Consequently, the
domestic price of cotton, which
un1M a few weeks ago, stayed
c
® *° J; e ceding price, and
could hardly be contained there in
Jauuary and February, is now
way down to near the government
fertilizer
unheardof
fuller
a
and
new
increase
of
use
machinery; to
the decrease of horses and
mules;
the improvement of seeds, and
to
to
in
progress
and
one-third
had
increase
been
be
too
for
<
age
the
further;
the
the
years
fast
and
war
time
a
needed.
was
a
not
prog-
of
In
had
con-
1951,
first
time, we expect a
high prices, the acreunder cultivation has been inDue to
creased
and
is gaining.
favorable
the
came
could
in
made
solidation
rise.
production
Production
increased
been
in
achieved, there
standstill.
ress
animal
breeding
However, after this,
feeding.
the
far
too,
r
in
except
Wheat Belt.
support
year
million
and
will
we
be.
Cotton
have
bushels
to
will
be
Exports
reach
plenty
needed
are
350
bushels, though they cid
not
curtain;
increased
and
year
see
and
their
can
whether
come
Beef
cattle
(all
cattle
except
There
is
This is under
the
pig
crops,
other
things, points topeak of cattle herds next
among
wards
a
of
(from
to
be
course
increased
our
nearly
population
132 million in
156
around
judged in the
million
next
1940
year)
move
thus
the
feedlot
his
out
down
most
beef
Vi al for the production of
beef
is
whether
herds
being
are
stocks
all-time
an
peak
pounds in 1947, the
a
reduction
of
12"billion
of
same year saw
beef
cattle
hand,
beef
in 1943
and
saw
veal
production
small decline while
a
the number of beef cattle
afford
wheat
once
to
Another
very important factor
affecting the output of high-qual-
ity meat
held
is the
for
number
grain
of
feeding
Seen
the
and
will
Canadian
the
*
in
the
light of population
growth and disposable income the
stant
dollars)
capita of the
then we find
per
population,
only 93.3%
herds of
of
were
normal, the large
only 87.2% of
1950 were
normal,
those
normal,
and
of
the
1951, 87.8% of
indicated peak
be only somewhat
better—-88.8%
of
That
normal.
to decline, slaughtering
will be
considerably larger than so far
this year;
much larger if the de-
clinc should start.
Already in the
fall,
October,
probably
cattle will
houses
last
year.
with
connection
of
clamor for
increase of the
an
the
hogs
This
disposable income is important for
beef consumption is evident from
slaughtered in the fall and winter
studies of the Bureau of Agricul-
and poultry indicates lower prices
tural
ahead.
there
ship
Economics, which show that
is
rather
a
the
between
imeat
consumed
stable
retail
and
is
for
this
numbers
scrapping of the second and third
of
disposable
to
rollbacks
cattle,
on
The number
of these animals and beef production does not
move
This
year.
is
parallel,
so
year
if
even
about
though
see
Dairy Products
A decrease in beef
prices would
.than anything else to
stabilize the cost of living and to
do
more
end the fear of inflation.
Our
we
poultry
numbers
are
enough
between
eggs over the next year,
miIk' there is no surplus
the
born
brought
time
the
and
to
the
animal
time
market.
it
is
Incident-
to
guarantee
foreign
for
much
which
cotton,
higher
than
down too.
come
world
cotton
35-36
million
bales
27 % million last
1949-50 oversupply has been taken
last
purchasing power. Milk productian wil1 probably not gain significantly, because ! nearly the
Continued on page 32
shortened
decade.
time
much
Due
lag
over
has
been
the
to
as an
ojjer to buy,
PRICE $102.50 PER SHARE
1'Llo ACCRUED DIVIDENDS FROM JULY I,
1951
The
/
•
,
....
as
against
year.
,
„
..
Fats and O.ls Probably
uverspppiy
•
The
that
we
Copies o f the Prospectus may he obtained only from such oj the undersigned as may
legally ojjer these Securities in compliance with the securities laws oj the respeclwe states. *-
.
in
t
large
cotton crop means
will have ample supplies
°f cottonseed oil. It
was
EASTMAN, DILLON & CO.
the rela-
cottonseed oil, there will be
a near
record supply of soybean oil; the
second largest output of lard
a
large tallow arid
grease
and
will exceed
13
billion
MERRILL LYNCH, PIERCE, TENNER A BEANE
UNION SECURITIES CORPORATION
....V
BLAIR, ROLLINS & CO.
HEMPHILL, NOYES, GRAHAM, PARSONS & CO.
Incorporated
produc-
tion. In the year beginning-Oct: 1
our total fats and oils
production
against 12.3 billion this
..
pounds
year
as
and
.
SHIELDS & COMPANY
August 3, 1951.
to
the
improved feeding
methods'; it now takes only two
years to bring a steer to the decired
slaughter weight, whereas
this
is estimated at
crop
As
as
care of by a larger consumption of
milk in fluid form due to increased
ally,
were
ceiling
our
high
sufficient
(PAR VALUE $100—CONVERT!BLE PRIOR TO AUGUST 31, 1961)
gain too, due to the price
In the meantime, prices
a
we
the quotas
consider the time lag which exists
is
the
for animals stay on a while.
disposable
income per capita is only a crude
measure
of
the
significance of
beef cattle numbers.
that
value
worried
not
are
would have liked to
cattle
reason
we
Nevertheless, the above ratio of
by
It
relation-
income.
beef
and the record number of chickens
sup-
incentive.
in
high
will be
very
that
port price from 90 to 100% of par-'
ity. Cotton production abroad will s
show
more
to the slaughter-
come
than
'numbers
in
33A% cumulative preferred stock. series b
SMITH, BARNEY & CO.
wait
cattle
on
feedlots.
United States Plywood Corporation
LEHMAN BROTHERS
prices
by
rose
3.6 million head,
already
which last year pushed up all
prices of fats and oils. Besides the
last
herds
by 2 million heads. On the other
60,000 shares
tively small production of that oil
over-
in¬
creased or diminished. Thus, while
beef and veal production rose to
-
in the
countries
cattle
the
increase
poundage.
circumstances lo be construed as an oJJerin/j oj these Securities for sale, or
or as a solicitation
oj an ojjer to buy, any oj such Securities. The ojjer
is made only by means oj the Prospectus.
NEW ISSUE
is in, and there is
crop
n<f
million
so
1950/51 crop year. The Canadian
wheat crop promises to be excellent contrary to last year; wheat
will be exported from behind the
iron
than at the high-point
Next Year WiU Pr#bab.,>' Brto«
The Peak in Cattle Numbers
keeP the price at that level,
to
once
The
vdomestically.
expected
price.
prices, have
large excrop will be
somewhere around 1,040 and 1,070
million bushels.
Of this, 700-720
will
more
h"lk of whether it will be possible
of wheat, no matter how
ports
on
to
and
This
years.
'
Sufficient Grains
This
fertilizer
The weather has been
so
southwestern
'
of
use
im-
3-4
fJt
manpower; to the increased use of
age,
to
operator
faster
took
possible for
,
n
3uhe 10 million bales last
y.ear whereas our own consump-
This
due
hon
tive remains strong. Use of fer- of Jan. 1, 1945. Nearly all of the
tilizer can still be increased and increase will be in beef cattle.
acre-
farce.
was
in the rate of increase of
now
fo °.1?rrec?r<!' Ther? ls
talk °f 16-18 million bales against
farm
be
whether farmers expect more inflation and what their profit and
loss decisions are. The slowdown
for 1952 would
-
we
did
come
been slaughtered early, are being
ralsed to maturity. Thus beef, and
much hi§'her than before the war especially veal production has
—about 3.2-3.3 billion bushels in- been smallei all throug last year
stead of 2.4 billion bushels This
so *Ear tl^wyear-than would-be
In spite
ages>
by about one-third—in
smaller
1952
that the record herds of 1945
by°^ t £££ ZZtun"te lieaee
a
in
ally
attained
the
herds
human
seems
U.
shape,
of
agined. Much will also depend
(Hog slaughtering now is season-
vear
a
again be in
could a further
the
beginning Oct. I,
1951; It would, however, not leave
anything to add to the reserve.
crop year
short-
were
after
excellent
increase
light of
our
should
pastures
must
introduction of hyona corn, sec-^ expect the number of-cattle
hadonclly> to the use of more tertil- during this year to gam by more
sticks of neariy all iz?r. Ml machinery, etc. If we than even "last year's arge infarm products except cotton were Wlsh to maintain our livestock at
jrease
vilma
In
nearly as large as last year, which Pfesent levels, we will want still fact, it looks very much as if on
proves that the supply was ample hlSher
average crops.
Further Jan 1, 1952 we will have 90-91
in spite of some stockpiling.
progress in the yield per acre million head of cattle 5-6 millooked
ched
3.3 billion bushels, and only
if
in the
on
,
manufacturer
this
most
"SmiaS
for
"
.
and
Peak
1952. Only if the
should considerably ex-
crop
would be just what will be needed
and "J® third highest on record.
all
corn
if
it
The
million bushels less than last
of
All-Time
An
makes
steadily and are now at a record, and of the rise in disposable in- coming increase of cattle herds
corn crop may turn out near the
The 1951 pig crop, which will come (what is left after paying seems ample, but not too large,
July l government estimate of come to market from the middle taxes).
though it would be burdensome
If we take the 1940 relationship
3,300 million bushels. In view of of September on, is the second
in times of depression.
as
a
basis
and
large oats
and
grain
adjust the beef
Even if cattle numbers remain
sorghum highest, only exceeded in the year
supplies and possible imports of 1943, and at that time pork pro- cattle numbers for changes in dis- at a plateau in 1952 as
they did
frosted wheat from Canada, this duction proved too large even for posable income (valued in con- in 1944 and 1945, and not start
increased
/•Last year's tightness in food and
fibers was due to a small onttnn
*
f
small cotton
crop, to the fast pace of the inof
in
The rise in beef cattle numbers
the
weather stays fair from now on,
will be large enough even for our
43.4
to
year-
Herds Ahead
futures quotations.
crease
its soybean
Philippines
are
i
luu^inta
the
mc
increasing their copra exports.
of
carryover
1933
level of 65.4 for
t*
l,
strongly only a few months
more
so
July
and
anci
exports
cApuna
and 1 will be higher than expected peak,
products
Mrs. Edith J. Hirsch
Thus, on July 1,
will probably have added
1
the
agricultural The
■-
.
is known.
1952,
to
grains
be
down,
,
crop
4.1
last
in
40.8
1950, 59.6 in 1951 and the indicated
cottonseed
crops
from
rose
has brought down
slow demand for fats
very
government
situaiion of plentiiude in agricultural products,
dairy cows) numbers, in millions-formerly
prices to about 60% of their Janu¬
ary
'
J
beginning
year
1940, do 57.8 in 1945, dropping to
53.1 in 1948, then rose to 55.7 in
a
and oils abroad,
By EDITH J. HIRSC1I
a
the
I, 1939. This outlook, coupled
with
Farm Products
Foreseeing
13
1
.
<
DEAN WITTER & CO.
The Commercial and Financial Chronicle
(514)
14
r
total
Donald D. Leeds
;
Donald
Leeds, partner in
Co. of New York
D.
Mutual Funds
Bartow Leeds &
passed away at the age of
injuries received in a traffic
City,
46 of
accident.
Man"
equipment, paper, automobile and
gaining
auto accessory
support in the Pennsylvania State
House as the result of a recent
amendment which would limit un¬
listed investment companies per-
Early in the
Bill
reported
was
be
to
the
those
investment
open-end
Reductions
com¬
capital
without senior
from
investment dealer, or from
your
The
research
&
securities
corporation
120 BROADWAY, NEW YORK
5. N. Y.
much
to
allay the doubts of legislators in
the
National
did
resist
to
who
House
be
what
they feared
might
tual funds industry a
liiiiv
i
wain
BfllBI
WELLINGTON
Ill L I
1 iron 1 lira
PiiiiiMi
imiiRH
CZIMMl
"Prudent Man" bills
your
from
or
in
2, PA.
shares of
mon
number of
a
had
S.
and
62%
of its
19% in in¬
preferreds;
Governments
and
and
com¬
panies in which the fund had no
the
they will be presented
BULLOCK
31,
and
amended,
on
June 30, equal to $14.57 a share on
R.
&
Pas
Field;
Lines;
.
Moore-McCormack
Public Service of
3,000 Standard Oil of
5,000
4,000
The
entire
fund's
of
stocks
of
number
of
companies were eliminated during
the
half
year,
including
2,000
American
Home Products; 2,200
American Natural Gas; 4,500 Cen¬
Illinois Public
tral
Electric
Auto-Lite;
Service; 2,000
2,000 Flint-
Portland
General
4,000
kote;
Cement; 2,000 Mueller Brass; 2,800
National
Cash
Register;
2,000
Fund, the num¬
outstanding having increased
72,868 to 100,799 during the
period.
ber
The
share asset value of
June 30, 1951, was 2.5%
than at the beginning of
the year; adding back the 43 cents
per share paid out to shareholders
from realized profits in December,
1950, the per share asset value
was
12.3% higher than it was a
.
.
The
"deflationary
calendar reading the early
increase in net
Prospectus from your
to
investment dealer or
a
today to
holders
by
assets
1951, according
semi-annual
its
mitted
report
its 68,000
Walter
L.
Commenting
Established 1894
The
\
June
New York
One Wall Street
i l-\ "i
p
h
a s
assets
of
the
Investment
568,684 at the close of June, 1951,
$9,547,144 a year earlier. Net
from
in
e"
30,
a
1950.
The Keystone
Speculative Pre¬
2 reports net
on
June
continued
$19.03
when
last,
at
share
Morgan,
$171,482,853,
the
on
Dec.
on
8,120,162 shares
standing.
on
or
8,971,480
The
(Custodian Funds
Participation in
INVESTMENT
1950,
out¬
;
,
Wellington
Fund realized securities profits of
$3,806,172 to leave an unrealized
appreciation of investments of $8,364,891 on June 30, last. .
the
Certificates of
31,
were
V
During the half
Keystone
FUNDS
report
year
called
"considerable
attention
to
1950
and
concurrent
recorded
on
DIVIDEND
adjustment" in
a
accordance with
ment
fund
its basic
invest¬
objectives, this "balanced"
increased holdings of cash,
due
the
stock
common
As
result,
a
the
risk.
of
fluctua¬
proportion
subject
portfolio
to
tions in common stock prices was
reduced
approximately
to
June 30, 1951; from about
on
at the
5.9%
76%
In¬
beginning of the year.
will ': continue
to
be
made* in' convertible
securities
vestments;
be acquired on a
with
the con¬
.nature
of
Whitehall
when
they
basis
consistent
servative
that date.
SHARES
.
can
.
lessened
announced
to
considerable extent
a
by the favorable record of
convertible
securities,
many
which
benefited
as
of
S.
Governments
and
total
assets
net
between
bonds and cash
$13.78 a share, com¬
$19,502,492, or $12.77 a
31, equal to
pared with
earlier.
share a month
the company added two
Win July
stocks to its
of
holdings, 1,900 shares
and Seaboard Air
CIT
Deo.
31, 1950 and June 30, 1951. In the
same
period
the
stocks
proportion
was
of
reduced from
These included the
June
office
June 30, 1951, and hold¬
U.
$21,125,596 at July
Shares rose to
comprised 18.48 %, compared with each
preferred stocks and lower grade
merchandise,
on
of
valu¬
American
Selected
of
ASSETS
other high-grade
ings in industries with a favorable
long-term outlook were increased.
drug,
ings
more
American Business
48.2% to 44.5% of net assets and
bonds
from
stability
22%
last,
30,
to
18.4%.
On
investments
for
represented
52.23%
Shares, Inc.
of
Prospectus
upon request
BONDS
(Series B1-B2-B5-B4)
Lord, Abbett & Co.
PREFERRED STOCKS
(Series K1-K.2)
f
New York
—
Atlanta
Chicago
Los Angeles
—
COMMON STOCKS
(Series S1-S2-S3-S4)
,
EATON & HOWARD
The Keystone
50 Congress
ten
Ji§L
EATON & HOWARD
STOCK FUND
BALANCED FUND
Company
Street, Boston 9, Mass.
Please send
your
me
prospectuses
describing
Organization and the shares of your
Funds.
....
•••;
~
A
PROSPECTUSES OF THESE TIVO INVESTMENT FUNDS
Diversified Investment Company
Prospectus
may
be obtained from
your
BE
OBTAINED
FROM
YOUR
INVESTMENT
DEALER
MAY
OR
local
eaton
investment dealer
200
Name
or The Parker
Corporation,
Berkeley St;, Boston 16, Mass.
& howard
INCORPORATED
BOSTON
Address
City.
y
FOUNDED
State
D 4
of
..."
investing their capital in
i
the
convert¬
the
became
feature
able.
high-grade bonds from 26% to 33%
common
chemical, con¬
assets
ible
U. S. Government bonds and other
stock investments, made
since the first of the year. Hold¬
common
tainer,
distributed
cash, bonds and
.
share
a
be
to
in
roughly 50%
30,
Although higher taxes ana re¬
that total net assets on June 30,
maining price and credit controls
amounted
to
$92,087,858,
should exert a downward pressure 1951,
equal to $1.76 a share on 52,348,on corporate earnings, defense ex¬
953
outstanding shares.
These
penditures, on the other hand,
compared
with
$77,743,380,
or
"militate against the prospect of a
$1.57 a share on 49,653,714 shares,
serious
economic
slump for a a
year earlier.
considerable period ahead," Mr.
Investments in common stocks
Bullock said. *
vv
./
Against this background and in constituted 81.52% of total net
shares outstanding. This compares
with net assets of $154,486,613, or
■Ma
of
tightening of credit conditions.
share¬
report listed net assets
$19.11
the investment
on
position of this "balanced" openend
investment
company,
Mr.
Randolph states that "net assets
term
months
trans¬
President.
calvin bullock
earlier.
year
.
$17,0C0,000
on
higher
Fund.
During
the
half - year,
per share on bond and preferred stock prices
inflationary trend," 227,597 outstanding shares.
This in general suffered a relatively
Hugh Bullock, President, noted in represents a decline in net assets serious decline as a result of the
the report. The deflation, he said, from
the
$8,322,742 Von. 382,830 changel level of interest rates.
stems from the heavy accumula¬ shares a year ago, but an increase
The impact of this change
tion of inventories in the last six in value per share from the $21.74
on
Whitehall Fund's assets was
longer
part of next week.
in the first half of
per
$18.66
Bond Fund B1 increased to $17,-
through which the nation's econ¬ ferred Stock Fund K
$5,870,134
necessary for the bill to be re¬ omy is currently passing "is likely, assets of
printed for a "fourth"- or final icy prove a temporary tulf in tne 1951, equal to $25.79
recorded
the shares of the
from
holdings
a
growth in total assets for the last
year—to $1,881,020 from $1,238,841.
The increase was largely
due
to new capital
invested in
.
third reading, as
Wednesday, Aug. 1.
WELLINGTON FUND
trade, 6.91%; railroads, 4.77%; and
chemicals, 4.58%.
Whitehall Fund, revealed a 51.8%
on
R.; 3,000 Iowa-Illinois
Electric; 5,000 Marshall
Island
Because of the amendment, it was
passage
of
gas
FRANCIS F. RANDOLPH, Chair¬
man of the Board of Directors of
stock investment
.1,146,521 outstanding shares. These
earlier.
July
and
Dec.
Net
the first six months of
the year.
Net assets totaled $16,708,289 on
-
-
oil
were
31, including 3,000 shares of Bigelow-Sanford Carpet; 4,000 Rock
common
asset yalue per share amounted to
$26.22 on 670,003 shares at the
compared with net assets of $14,- close of the first half of this
year,
507,852,
or $13.98 a share on 1,compared with $26.98 for 353,798
The Snowden Bill passed second037,742 outstanding shares, a year shares on the corresponding date
reading in the House Tuesday,
in mutual fund shares.
holdings
group
stocks
.
signature, to¬
opinion from the iport for
an
largest
NET
assets
of
Nation¬
preferred stocks and 50% in com¬
were
$206,686,300, compared to mon
stocks.
However,
some
Securities Company as of
$198,489,100 a year ago, it is dis¬ convertible bonds and preferred
June 30 were at the highest level
closed by the sqmi-annual reports stocks were eliminated from the
for the end of any fiscal period
of Keystone Fufods B 1 and K 2,
portfolio
as
they advanced in
in the history of
the company, made public today.
price and became subject to un¬
according to the semi-annual re-
-wide
Governor's
gether with
The
TOTAL
slated for
are
Attorney General. The two "Pru¬
dent Man" bills are identical, ex¬
cept that the Snowden Bill spe¬
cifically permits trustees to invest
I"
bonds
U.
the
adjustments
30
2%
in
appreciation
preferreds. On Dec. 31,
61.1%
was
in
commons;
cash;
readings
the House,
for
PHILADELPHIA
June
bonds and
in the House on
Monday or Tuesday of next week,
after which, if they are passed by
investment dealer
shares, comprising 15.94% of total
net assets; utilities, 13.41%; retail
legislators them¬ 1950,
Northern Natural Gas; 2,000 Ohio
selves felt, some of the opposition 16.9% in investment bonds and
Oil 2,500 Parke, Davis; 2,200 Safe¬
to inclusion of open-end invest¬ preferreds, 20.6% in U. S. Govern¬
way Stores.
ment companies in the "Prudent ments and cash, and 1.4% in ap¬
Man" bill disappeared.
preciation bonds and preferreds.
COMBINED NET assets of the ten
W Both the Berger and Snowden
Keystone Funds on June 30, 1951,
final
prospectus
these
on
holders that the
|H!r?
,
respectively,
1950.
common
correspond¬ -17%
ing prudence;
and concern
for the long-term welfare of share¬
in
groups
13.24%,
1950.
common
the report,
appear
to have less
long-term appreciation possibili¬
ties than investments in growth
vestment
caution
s!"sgaa
stable
net assets in commons;
mu¬
made
were
more
and
June 30,
52.68%, respectively, on Dec. 31,
Indiana;
Ohio; 3,000 Studebaker.
Fund
legislators dis¬
covered in the leaders of the
in¬
as
After
"investment trust" of the '30s.
When the House
also
the
industries.
of the old-fashioned
revival
a
determined
were
industries
86.76%
on
tobacco, utility/ and tele¬
phone stocks, which, according to
such
amendment
of
some
or
bank loans.
Prospectus upon request
volatile
more
cluding aviation, nonferrous metal,
railroad, rail equipment and steel.
missable for trustee investment to
panies
year the Fund re¬
investments in some of
its
duced
groups. ;,.n
Thursday, August 9, 1951
.
appreciation represented 47.77%, compared with 47.32% and
During the first six months of
1951 Nation-Wide purchased com¬
By ROBERT R. RICH
"Prudent
SNOWDEN
THE
.
for
>
=
'
investments
and
assets
net
.
1925
m
24 Federal Street
BOSTON
333
Montgomery Street
SAN FRANCISCO
.Volume 174
Line.
Number 5036
.
.
The Commercial and Financial Chronicle
its
increased
It
.
holding of 153,000, net assets per share at
shares $13.14 and in shares outstanding
from 2,500, of American Cyanamid at 544,194, Chester D. Tripp, Pres¬
to 3,800 from 3,500, and of Deere ident of the Fund, disclosed.
►
to 7,200- from 7,000.
It reduced
The
Fund, concluding that a '
holdings of Boeing Airplane to "strong defensive position is ad¬
600 shares from 3,000, of Interna¬ visable" at the
present time held
Illinois
Central
to
The Impact of Higher Taxation
On Commercial Banks
•
tional
Harvester
to
shares
1,000
23.1%
of
total
its
net
oil 15.9% of assets, chem¬
9%, steel 8.5%, retail trade
8.1%, railroad 7%, electric utility
ditions
and
the
were
metal
each.
5.3%
Common
stocks represented 90.1% of assets,
Pointing out, because of low
banks
in certain
portfolio
securities
holdings
not
owned
now
Commercial banks
to
MERRITT
Company,
recently become
has
York,
actively associated in the distrib¬
ution of Founders Mutual Fund in
1
several
of the country, with
areas
Total
&
^present emphasis in Minnesota,
-Pittsburgh area, Alabama, Mississippi and Missouri. *
-
of
assets
the
Fund
third
fiscal
with
quarter,
$5,180,306.92,
share,
a year
or
per
change
holders
opinion," stock¬
told, "that' the de-
>
•
1
&
demand
or
amounted to $15.35 per share
com-
pared to $12.34
1950,
being
on
June 30,
the
for
is
ing
the period, Stock & Bond
Group Shares paid dividend dis¬
tributions from ordinary net inand
-
per
put
'
the
Shares,
$11.37
-
Ltd.
amounted
WALL
to
30,
June
1950, being an inDuring the period,
of 20%.
crease
STREET
of
30,
1951
$2,741,528
dend
-net
distributions
income
and
from
ordinary
security
Investing
the
.
223,128
compared
31,. 1950. Per share net
share.
per
'TELEVISION
five
was
billion,
Fund established
81.4%
record
new
and
highs
$2,-'
mmumm
'•
:'
'V-'
•••
■
m1
t
::
in
an
capital
of
for all
other
with
<
taxation
Federal
.
denies
to
enables
11th
The
a
.
a
investment
net
centive
I
have declared
dividend of 15 cents
from
of
proposals
capital,
«hare,
A
Prospectus describing the Com¬
and
pany
the
ing, is
Tripp
Pj
President
its
shares,
available
upon
ful
ing
to
The
\ New
additional-,
-
for
an
expand-
effect
of
Federal
heaviest
bears
those
in
Newfybrk. City
a
today
on
need
of
greatest
How Much Can
capital,
accept
their
banks
and
the
are
the
which have
broadest contact.
banks
public,
merchandising
absolute
good
to
of
answer,
course.
It depends
$5,000 during the
is
reason
organization itself.
our
primarily in
type
one
on
your
We deal,
on
a
nation¬
of security—Mutual Fund Shares.
specialization enables our salesmen
higher commissions.
to
sell
more
effectively,
work with us. you spend your time productively, in
You're not bogged down with paperwork and details. We
you—and keep you constantly supplied with sound
selling ideas.
,
C
you
handle that for
Like
your
at
placedthem
rnnital
well
to
know
more
territory?
this
about
Just
it
write
.
or
.
.
about
phone
specific opportunities in
King Merritt, President,
office.
.
at
discounts in
th
in
need
s
of
well
as
as
Federal
has
new
man-
government
governmem
bfnkfneauthmttfes
tavatinn'
hlnrks
manv
,■
Icrge and small banks from access
to
ranital
new
and
seriouslv
Nevertheless
andfederal
alert
banldne
the
to
han-
State
authorities
shrinking
capital
ratios resulting from the increased
deposits
and
properly recommending
•mital fnr
lem
manv
hanks
KING MERRITT 6- CO., INC.
22 East 40th
St., New York 16, N. Y.
MUrray
Ili'll
additional
Thp nrob-
centerT^n
the
FROM
to
at ^discounts
sell
book values.
The dominant
for "banks at
a
^om'
reason
TO
at
earnings,
were
stockholders
to
were
take
these
with
statement
not
up
the
connection
Senate
with
Finance
its
Committee
hearings
on
In
the
pending tax bill, H.R. 4473, Aug. 2, 1951,
period
manu-
facturing corporations. Most banks
must therefore use the alternative
"invested capital" method in comex-
asset
ceed certain rates on invested
tal.
capi¬
The basic exemption from ex¬
cess
profits taxes for banks,
like
most
industrial
un¬
corporations
or,
vested capital. Hence bank stocks
continue at their discount from
unable
dividend return or yield for by the tax laws are(
calculated
before taxes. But in the eyes of
investors, and in the market place,
stockholders on their book value meaning is given only to what is
had been less than 4%. This was v left of normal earnings after.taxes,
clearly a Penalty, a general ac- The rates allowed on invested
knowledgment that bank earnings - capital of 12%, 10% and 8% im¬
are too small. - In other bank iir pear adequate but after regular
nancmgs, old stockholders were taxes of 47%, the net of 6%, 5%
Penalized elven further Moreover, - an«T 4% ..s -no longer adequate,
banks they will soon dis- This earning rate of 4% is too low
these new partners was nearly 5%,
whereas the rate received by old
•
.
that Federal tax laws pre- to
^ent th^ new capital from^earn g . n
issued shares.
filed
base
iheir sub-.
fjfey^effect! bl
Schapiro
their
Puting their exemption from
low
offered to
discount" has been,
Mr.
for
did industrial and
scription rights, new partners were; book valuef
taken in through the sale of shares
Second: Normal or non-excesat a discount from book value. • sive bank earnings, which are not
addition to sacrificing part of subject to excess profits taxes, are
their eduity, the old shareholders subject to combined normal and
found their earnings diluted.
. surtaxes of 47%.
Such normal or
To attract new stockholders, the non-excessive earnings as define#
good the dividend
COAST
earnings"
years as
pennies!
of
9-1586
COAST
subscribe
Banks gen¬
erally did not have high "average
P
unquestionedi asset value still con-•covai
tinue
*A
OFFICES
,
Recently, in the case of a na¬
tionally prominent bank where
unwilling
there
bTnk
to
concern
,
with other industries.
values, create this difficulty.
that
place where prime bank shares of
book values, bank shares
quoted
.
larger
as
and their problems
ar^of
fore
others
selling.
new
on
stockholders, the price was set at using "average earnings," is small
70% of book value. To the extent ,*n relation to book value or in-
earn
When
ings
were
Ulll)rofilable
shares, and then the pro-rata
additional shares
individuals and
as
ructomers^ExD^ndinc busine'ss
aeements
month.
same
serve
small businesses
jta,
.
prospective
alike,
banks
of
ability
and efforts—and the company you re with. But just for the record,
one
of our salesmen actually earned S11,00() in commissions dur¬
ing one recent month. Another earned over $8,000 and several
This
First: Because of their low earn¬
to
costs.
banks are compelled to'
less than fair value for'
~to
Coun-
average
city
the
banks," they
wide basis,
is—banks do
answer
prices are
in
if not cess P/°^ *«. Under this
Qu°ted as worthless. Current and fined
method"excessive"
corporate earnings
are ex¬
ocwhen they
generally providing a retail type
operation. "Brown derby
You Earn
Selling Mutual Funds?
than
The
disadvantage in comparison
c
traded
thLi
been greater
try
with
more
on
rising
excess
profits which arerexces¬
sive, and the excess profits taxes
they are compelled to pay keep
them at this discount. This is true,
their
'
financing can only be effected at or below these depressed
quotations. To obtain additional
their services most effectively and
One
passing
the
..
serving
adverse
taxation
developed
others
in
define
are
not have
the extent to which
on
critical impasSe
laws
tax
Banks
counts?
these
When
a
paying taxes
on
their
"excess
profits."
The
questiJn is asked, how can banks
have "excess profits" when their
shares are quoted at heavy dis¬
must
one
now
customers
ap-
economy
they
no
disclose.
industry
as
their
request.
EBERSTADT & 'CQ. INC.
'■} 39 Broadway.
135 S. LaSalle Street, Chicago 3, Illinois
including
price and terms of offer¬
July 16, 1951.
There's
Federal
profits.
Banks have not been as success-,
of increasing impor-
now
tance to banks
income,
record
Chester D.
earnings,
stockholders'
on
for banks,
is
capital
shareholders
for
prove
payable July 28, 1951, to
shareholders
un-
It
assume.
living
capital will then be told.
banks
places
makes proposals for new
capital costly, and often prohibimoney
which allI have experienced Under
ior ,
th
Excess proj:its
is
actually taking place, as evi- these circumstances, taxes force. •£.
f lp-n
p
.
deneed by the increasing number, the d i s c o u n t on stockholders'
riod average earnings and techni¬
of bank mergers throughout the
money,
thereby
penalizing
all cal
inequities place banks at a
country. Tax laws allow little in- stockholders,
basic
Quart»riy^iy^end/A
Directors
will
are known,
banks
are
operate as private enterprises.
The withdrawal of existing
to
Low earrt-
ing power continues "banks at a
discount." This discount which the
market
do to keep in the
But from these low
can
place."
alone
inves¬
commercial
taxation is penalizing.
>
is
The effect of Federal
book value.
of
over-
money
capital,
power on their stockholders*
investment. This they do not now
have.
If they did, their sharps
would not be quoted at less than
deduct the losses which the future
tors fair hire for the very money
which
•
you
and hard-won
difficult
capital
new
had
have
same
to obtain.
— i
%.ihC
stockholders'
on
18.6% in cash and U. S. Gov¬
finding
merely
income
retain
and
have adequate earri-
fairly low despite the expanded tive, and creates
ning
stocks,, return, investors are not attracted
to banking, and banks, therefore,
are
Most
as| the Red Queen remarked
to Alice, of "taking all the run-
Because of this low
taxes is low.
liquidity.
a case,
capital after
on
their
•
also
the added costs.
with the full
banks
as
businesses,
other
the rate of return
risk assets, but
services and risk assets which the
privately owned corporate
In banks, however,
compared
business
steadily in-
more
Banks
attract
ing
•
impact of
Federal taxation, the rate of earnings
v
subject to the
are
To
Now
com.
banks
Federal income tax laws
same
doing
by
year.
..came
.
as-
banks must
the-added
ex-
mercial banks.
ex-
loans, banks have had little to say
over
the price of their services,
reduced
enterprises.
$12.29
ernment securities.
Aug. 6' in total net assets 'at $7,"
invested
was
loans
•
or 102%
changes in
the im-
These
years.
These
banks in 1951
creased their
their total
all
sure its sound and steady growth.
each
1950
Of
costs
pected to be 73% above 1945. .
In competition for deposits and
income
Morris A. Schapiro
•
reached $61.6
portance
'
shares,?
with
of
operating
Since 1945, they maintained their
t
pansion of $31.2 billion
Cor¬
compared with $12.25 at Dec. 31.
ELECTRONICS
-
couragement and safeguard to
in-
'
of $.625
are
j
the banking scene increase
346,167 and 191,506 shares at Dec.
profits
tal keeps commerce free and flow[ing. Bank capital needs every en-
,
1950. "
of'
end
had
reported net assets
with
J Aviation Group Shares paid divi- outstanding
.
an
poration, for the 6 months ended
share compared to $9.47
per
June
on
air will be
in
Aviation Group Shares of Institu¬
tional
the
on
date, net assets of
same
'
assets.
loans
J
insured
benefits
pension costs.
Icommercial
enjoying
important factor in inducing purchase
by many of these families."
security profits of $1.25
share.
On
not
Impasse
capital to keep pace
with expanding business. The im-
of State and Federal income taxes,.
-
television
expanded
but which is within the range of$11.0 billion or
reception. It is our belief that the 1
nearly 22%. At
improved programs which will be /
*
'•come
still
Critical
in
the public interest because it is a
guaranty fund protecting the peopie's deposits against impairment,
By making loans to individuals
and business possible, bank capi-
and"
in
Banks
salaries, wages, and reare higher.
There
The total of interest
paid, rents, supplies and
other expenses are up. Exclusive
are
deposit lia¬
risk
financing to.
to'
portance of this new capital is recognized. Bank capital functions ip
lated
.
growth
Thus,
There *
New
in-
large segment of the popula-.
sured -banks
a
tion
increase of 24.4%. Dur¬
an
of
have
bilities
~
be met.
wait for favorable conditions.
But
come.
unprece¬
■ of
'telesets' has
too distant future.
not
an
dented
to
are
.meet these demands will have
I-V'v
;
must recognize bank
worthy of its hire, if
»
earning
low
as
demands of the banking authori¬
ties for stronger capital structures
-
banks has increased their gross
times,
banks
our
Bond
capital
True, expanded business of the
experienced
Group Shares of beer} largely seasonal and that a
normal upswing will commence in
/Institutional
Shares,
Ltd.
Stock
.
-
earlier.
were
trend
ary
"There appears to be no reason
to
authorities
Taxes Force, the Discount
„
inflation¬
our
their
today,
,
Banks seek
result of
a
the
compared
$10.88
capital, taxing
on
power.
individuals, to business, and to
As
-
$6,970,733, or $12.86 per
share at July 31, the end of the,
is
and
government.
were
1951, net assets of cline
ON JUNE 30,
net
essential
are
our
to
.
New
rate of return
other corporations is making bank
as
dynamic economy. They
give efficient service at low cost
t
preferreds 0.2%, U. S. Government they appear to be attractive for
securities and cash-9.7%:
>
. long-term purchase."
V
KING
basis
same
provisions penalize growth of needed commercial banking.
Criticizes Excess Profits Tax provisions relating to banks.
-
.
of
when
on
tax
now on
and the addition
are being served by this
strengthening of capital. But the
limitations of present Federal in¬
come and excess profits tax laws
on earnings make these proposals
unprofitable. They are only now
becoming alerted to this costly
situation.
Government
taxing
shares unattractive to investors, and therefore banks are un¬
able to obtain needed capital, Mr.
Schapiro contends the new
Tripp told shareholders, "as con¬
appear to warrant an in¬
crease
munity
President, M. A. Schapiro & Co., Inc., New York City
2,500, of Santa Fe Railroad cash and government securities at
to 1,000 shares from 2,000. Entire
July 31, according to its quarterly
commitment in Eastern Air Lines
report. This compared with 10.2%
'(1,900 shares) was eliminated. : at Jan. 31, 1951, and 4.7% at July
Selected
American
Shares
on
31, 1950.
"The holdings ,of cash
July 31 owned stocks of 104 com¬ and government securities will be
panies. Largest holdings by indus¬ used from time to time," Mr.
ical
banks and the needs of the com¬
By MORRIS A. SCIIAPIRO*
in
assets
from
try
believing that the future of their
.
3,700
15
(515)
on
makingI■ pubhc
-
'invpstnrs
.
making
regulated
utilities, know that
public
the newly. service commissions have always
Stockholders who approve pro-
posals for capital increases do so
recognized
5JA% after taxes, and
Continued
on
page
32
The Commercial and Financial Chronicle
(516)
16
Continued
from
ico buy silver from time to time.
outlines of Mexico's silver
4
page
The
policy last year may be traced in
Handy and Harman's 35th annual
Silver Marks Time
review
major demonetized
a
in
and
some
cases
the
which
fluence
of
existence
the silver coins
of
has
ordinary"
million
bullion
"silver
of
amount
Great
sold, less than five
This was silver
was
in
the
from
Saudi Arabia
Total still
"During
War
The
Lend-Lease
and
the world silver market
by the debtor gov¬
I,
with
market,
ernments
on
eye
an
possible Treasury sales, looks first
the so-called free silver in the
at
Treasury.
This silver, the coun¬
terpart of seignorage accruing to
the Treasury under the silver pur¬
chase
laws, is metal not required
backing for outstanding silver
sis
certificates.
At
free silver is
this
rather
a
the
writing
substantial
amount—about 153 million ounces.
Such
subsidiary coinage needs as
arise while the Treasury pos¬
silver
going
to
United
be
out
and
turned
States.
The
over
a
with
larly filling
taken
the
metal
of
metal.
more
the
of
demand
for
the smaller
came
World War II
subsidiary
coins
denominations be¬
very
great, what with so
moving about of the popu¬
much
lation
out
but
cir¬
culation instead,
States.
to
Great
ha
Britain
is
approximately
one-fourth of its
million-ounce obligation. The
88
Netherlands
willing
to
accumulated
it
believed
is
to
prices
the
free
marked
also
is
silver
would
for the
be
lion
ounces
the
Treasury,
ear¬
the mints
longer avail¬
no
be
of free silver
during
sumed
it
is
World
annual
an
million
now
period,
in
noteworthy
War
II
the
con¬
of
average
of
ounces
war
64
silver.
Unlike
when
newly-
mined domestic and
imported sil¬
ver was channeled
through vari¬
ous
government orders away from
the
Treasury and into industry,
today newly-mined silver is in
large part coming to the Treasury
for
reasons
already
discussed.
In
this
3
way
monthly
are
million
ounces
coming to the Treas¬
Lend-lease
ury.
silver
could
be
additional substantial source of
free silver, but this is not
likely
to develop in the hear future.
Under the Act of March
an
11,1941,
as
amended,
of
ounces
nearly
411. million
free
silver were sup¬
plied to eight foreign governments
for
coinage and
war
uses.
The
various lend-lease agreements set
time limits for the return of the
silver
ounce-for-ounce, the limits
being five and in
some cases seven
after the end of the then-
yeat s
existing emergency
as
determined
by
the President. Such determi¬
nation having not yet been
made,
the return of the silver is not in
sight.
Of the
411
million
ounces
thus
lend-leased during the war,
only
the
261,333
ounces
lendlersed to Belgium has been re-
p-
.ced.
The
and
of
amount
responsibility
repaying
of
securing
equivalent
an
of
silver rests with the
countries which received the lendlease silver. It is
unofficially
re¬
ported that several of the lendlease governments have been tak¬
ing
steps
meet their
States.
to
assemble
silver
to
obligation to the United
Silver
from
their original form.
in
us
Since replacement of the lendlease silver is not required until
some
time in the indefinite future,
is not expected in Washington
that other countries will follow
coins
have
been
Belgium's example. The history
of inter-governmental war debts
is
bound
to
somehow, if
become
inspire
hope that
just waits, it will
one
unnecessary to pay up.
Busbar
During
leased
the
Silver
the Treasury
bullion to the De¬
war
silver
fense Plant Corp., a U. S. Govern¬
ment agency, and others to a total
of
902,622,278 ounces.
Of this,
nearly 402 million ounces is still
so held.
The greater part of the
last-mentioned silver is in use at
the
Atomic
Oak
Energy Commission's
I^idge plant.
ury's
books
On the Treas¬
about
350
million
ounces of the silver at Oak
is entered
as
standing
51
some
Ridge
against out¬
certificates
and
reserve
silver
million
ounces
free
as
silver.
It would take only a book¬
keeping entry, however, to classify
the
million
51
ounces
as
certifi¬
cate-reserve silver and simultane¬
ously to release an equal amount
of silver now held in certificate
reserve.
fore
the
of
The busbar silver there¬
does
not
affect
Treasury
as
the
a
position
potential
seller of silver.
ings on that day at 73c. were
wholly inadequate, and eventually
buyers found it necessary to pay
in
78c.
order
to
satisfy their
The next day a
Bank
of
re¬
more
carried
the
ounce."
per
November
Las
the
to
the
With
on
Control
the U. S.
of Market
Treasury sitting
the largest hoard of silver
ever
accumulated by any nation, Mex¬
ico, the world's chief silver mining
country, with the collaboration of
Cuba in regulating its sale of de¬
monetized
Cuban
pesos,
has
lat¬
terly been able to control the mar¬
ket price of foreign silver in New
York.
The
Mexican authorities
bring about
silver
not
the
desired
price
dustry
Mexico
Mexico
of
announced
sus¬
rest of
1951, the New York price,
had
recently sagged to
87.75c., promptly climbed back to
90.16c., an instance of market in¬
fluence, at least.
has
Users
than
more
Association
publicly
once
com¬
plained of Mexico's control of the
silver
as
market, citing that control
a
the
reason
this
does
American
in
her
own
interest
as
largest silver-mining
country and thus, on net balance,
a
seller
of
silver.
issue
is
whether
at
The
question
such
stabil¬
izing activities
are in the inter¬
ests of the United States as well.
Here
there is
division of inter¬
a
est between American silver
American
less
conspicuous.
of
only by regulating the
users
raw
:
'V-:
According to
despite
the
Life Insurance,
growth
that has occurred
the
bulletin
recent
a
of the Institute of
spending
in
in recent years,
American
that "it
other
and
forms
of
long-term savings.
This
and
evidence
of
the
strength
persistence of the thrift habit
the people at large, the In¬
stitute notes, is of particular im¬
portance at this time in view of
the need for a greater personal
savings effort to help meet the
among
in
increase
the
second
quarter of this year, according to
preliminary
estimates,
in
con¬
trast with what: happened during:
the
buying after Korea.
scare
Extent
Growth
of
ings
has
from
far
as
in
personal sav¬
growing steadily
been
available,
riod
of
volume
back
as
records
are
for a brief pe¬
early 30s. Two out¬
except
the
standing results of this trend areAccumulated
long-term savings
of
individuals, which exceeded
the end of 1950,
equivalent of ap¬
proximately $4,000 per family as
the average of the nation's 44 mil¬
lion families.
This amount is
billion
$176
are
to
at
the
now
and
two
one-half "times
is
than four times the
more
5,
1951,
Mexico
than
more
ever
38%
for
the
last
decade
alone.
Furthermore, these accumulated
individual savings of a long-term
the
as
distinct from ready
guarantee a fixed price to the nature,
producers of silver in this coun¬ cash or its equivalent, are now
try
This annual production is equal to nearly a full year's per¬
not needed by the Treasury, nor is sonal
consumption expenditures
it necessary for monetary use.
At the end of
It of all the people.
is needed by the industrial users
1950, for example, the people as
...
and would go a
long way toward
breaking the strangle hold en¬
joyed
by
foreign
governments
and producers on
ket."
the silver
press
mar¬
release
the
Admiral
quoted/from a Nevada
a statement made by
the general manager of the Sun¬
shine Mining Co. which suggests
that the U. S. mining industry is
not disturbed by Mexico's silver
activities.
That
the
"Mexico,
statement
number
reads:
one
silver
producer, is doing a very good
job in stabilizing the market for
its
the
product.
country's
domestic
A
variable
part
of
production
goes
to
coinage,
more
when the
market
is
strong.
The Mexican Govern¬
weak,
less when it
is
ment
through having the Bank of
York which buys up excess silver
maintains
re¬
certificate
as
by
re¬
serve.
an
office
in New
long-term
riod.
As
against this, total con¬
expenditures in 1950, even
with all the rise in prices and the
buying stampede that occurred
sumer
after
Korea,
only
were
about
greater than 1920.
Accumulated
long-term savings
individuals
consist
of
U.
S.
Savings
Bonds, savings deposits,
Savings, savings and loan
accounts, and net funds accumu¬
lated
life
behind
insurance
icies.
They
rency,
checking accounts,
assets.
1940576
do
Net
behind
pol¬
include
not
funds
or
cur¬
other
accumulated
life insurance
policies
are
distinct from the face value of all
life
the
An
insurance
the individual
comprising the
long-term series shows that U. S.
Savings Bonds have enjoyed the
most
spectacular growth of all.
At the end of last year the people
a
whole had
more
than 90 cents in
analysis
types
of
savings
of
owned
whole
a
as
The
;
is
earlier
laws
protection
underlying inflationary pressures
owned by the people which cur¬
arising from the size of the re¬
armament program.
It is signifi¬ rently amounts to $243 billion in
the aggregate.
cant to note, in this connection,
that individual savings showed a
Showing of Savings Bonds
to seek the repeal of
silver purchase laws which
an
effort,
Postal
necessary
In
feeble
a
books; much less, to
Treasury
of
and others failed to offer any sil¬
ver on the market and the
price,
stated
the
ily to their basic "nest egg" in life
and
Jan.
on
even
any
the supply of silver held
duce
200%
an
corresponding figure of approxi¬
mately $950 in 1920. The growth
in savings per family has run far
ahead of the rise in prices in the
as
in October, 1950, had to be
last three decades, the "real" in¬
raised, Admiral Ramsey, the legis¬
crease amounting to nearly 250%
lative counsel of the Silver Users
for the. period as a whole and
Association, in a press release
When
from the
people have con¬
outstanding job on
the thrift front by adding stead¬
tinued to do
mining interests
operating at home as well as the comparable per family figure
abroad. A high world price makes of about $1,700 a decade ago, at
this subsidy to American miners the beginning of World War II,
exportation of the metal, but also
Mex¬
its
not
of
personal savings to consumer expenditures has shown almost
uninterrupted increase in last three decades.
close
and
for
effort,
sign
no
Institute of Life Insurance study reveals ratio of
.
silver
world's
the
upon
is
there
to strike the silver purchase
in¬
which
silver
'
But
Savings Growth Exceeds Rate of Spending
marked
Agitation for Repeal
Silver
The
favorable
a
material.
disclaimed
pension of silver exports for the
Revived
at
mined
as
the
draws
insurance
director
charges that Mexico had driven
the price up.
Mexico, he ex¬
plained, was merely seeking sta¬
bility in silver. Yet this summer,
when
for
market
developed
Cuban silver
and
newspaper,
Mexican
ers.
silver
the largest sil¬
ver producer and as a large user
of silver coins at home, will con¬
tinue to be in a position to sta¬
bilize
and
regulate
the
world
It
it
with the 153 mil¬
minting of subsidiary coins
the
in
industry.
As compared
that
of
use
and thus become
able to
reflected
domestic
make
purchase laws should be repealed.
There
is
little
question
about
gerater need for subsidiary coins. was found that, when' the coins Mexico's policy of "keeping the
If we get into an all-out war with were paid out,
market orderly," at as high a level
they were hoarded.
Russia, it is conceivable that all Therefore> issuance was stopped. as possible.
Obviously, Mexico
of
long as the vast U. S. silver
chiefly
security for outstanding paper
money, while the mints supply an
assured market for newly-mined
OPS
.
as
also
quirements.
domestic industrial market
be eased by
may
stock continues to be held
further
Spanish
The
Thursday, August 9, 1951
.
a change in the
ceiling on domestic newlysilver, as fabricators point
out.
During World War II steps
were taken by the production and
price control authorities to ease
the supply problem of silver us¬
stocks,
temporarily unavailable,
were presented with an
unusually heavy demand. Offer¬
believed
consequent need holding the greater part of the
on hand.
Inflation lend-lease silver coins it received
cash
from
when
was
similarly accumulated
v e
longer
no
is
demand
.
Therefore, when
which
the
and
have
to
In
regu¬
the
So
producers
effect
wide scale,
out
were
large portion of the
a
needs.
80.25c.
India, where since time
immemorial silver has constituted
the principal money metal. Lend-
have
stocks
advance
India reportedly has withdrawn
may
from circulation much more than
sesses free silver are met out of
that silver, rather than by the enough silver to repay its lendTreasury's entering the markets lease obligation to the United
for
available
market
lease countries have not gone
into the market to buy silver,
current
seldom
were
moderate
the
in
even
from
to
has been to encourage the demon¬
etization of silver on
an
when
price, Mexico,
metal
buying
actual
cents
enough
satisfy buyers, and other sellers
to
that
would benefit
Silver
in New York
80.25
to
October
demand
point where daily of¬
a
ferings
of
production
and
When
an ounce.
Under the 1943 act
the
repayment
proviso
through 1945 the Treasury sold, at was inserted in the silver lend71.11c an ounce, more than
167 lease agreements at the instance
million
ounces.
Since
1945, the of silver Senators, presumably it
Treasury has sold 1,621,000 oz. of was believed that, as in the case of
silver, almost all of it during the Pittman Act silver after World
Free
cents
last October.
reached
45c
past few weeks.
73
ounce
was
outstdg. 410,553,011
It
of silver
price
from
sales
melting and
was sold at
regular
coining processes.
56,737,341
22,347,431
---
for
read, for example,
sells
Conclusion
it
was
announced
on
Monday
morning, Oct. 23, that at Mexico
225,999,904
Netherlands
shipments, re¬
covered from mutilated coin, and
gold
the
market's
88,073,878
India
ounces.
contained
Britain...
market
silver
we
low¬
been
these powers may have on the ered. Apart from Belgium, which
has repaid, lend-lease silver obli¬
policies of Mexican authorities.
From
October,
1942
through gations are as follows (in ounces):
1945, Treasury silver was sold to
Australia
11,773,093
help industry. Prior to the Act of
Ethiopia
5,425,000
July 12, 1943, only a relatively
Fiji Islands
196,364
small
the
explanation of the increase in
an
constitute
therefore
ver
potential influence on the market base-metal coins have been sub¬
In others the fineness
both directly and through the in¬ stituted.
of
There
1950.
and
heavy."
.
an
estimated
$50 billion of these bonds as com¬
with
relatively
nominal
outstanding before the
pared
amounts
the
of
outbreak
last
The
war.
government is planning to
run
the
threat
inflation.
of
New funds accumulated
behind
life insurance
a
policies have shown
10-fold growth in the last three
decades, increasing from $5 ¥2 bil¬
billion at the
end of 1950.
Savings in savings
lion in 1920 to $54
loan
and
amounting
accounts,
to
$14 billion at the end of last
over
approximately eight
than the 1920 total.
were
year,
times greater
Combined savings deposits in mu¬
tual
banks
the
savings
and
commercial
aggregated $55.1 billion at
of 1950 as against $15.4
end
billion
in
1920,
rise
a
of
some
250% in the period.
The
table,
following
compiled
by the Institute of Life Insurance,
shows how accumulated long-term
savings of individuals have grown
faster than
personal consumption
expenditures (in billions of dol¬
lars), and the relationship be¬
tween the two, for selected years
from 1920 to the present:
Accum.
-
Consumer
Expend.
</c Rates
long-term
savings
alone,
not
counting other assets, for every
dollar that was spent for goods
Year
Savings
1920_____
$23.5
$64.3
1925
36.6
70.1
and
1930
48.3
70.8
68
1935
45.6
56.2
81
services
during
the
year.
Comparable ratios this high or
higher are found only during the
World War II period and since,
and
the
extent
of
war-caused
shortages must be taken into
ac¬
count in the
saving-spending patrelationships
in
the
erns
and
years
from
1943
through
Comparison With
Of
also,
fact
that
the
Spending
usual
long
savings have been showing
a
1948_
far
72.1
82
123.1
110
147.1
146.9
100
155.7
165.6
94
162.7
177.9
91V
169.7
180.2
94
176.1
193.6
Bank
Board; U. S. Dept. of Commerce;
Institute
of
Lite
Insurance.
Two With Cons. Inv.
(Special to The Financial Chronicle)
approximately 650%
Russ Building.
pe¬
91
Loan
Home
Agatha
for the
52
59.1
rapid rate of growth than
consumer
expenditures.
Taking
the 30-year span from 1920 to the
present as a whole, accumulated
long-term savings show a gain of
more
"> 37%
136.0
1940
Sources:
interest,
view, is the
accumulated long-term
more
over
than
1947.
a
Savings Bond campaign next
month as part of its program to
stimulate savings and to help fight
new
SAN
Starolis
Goldschmidt
dated
Calif.
FRANCISCO,
H.
are
Investments
and
with
—
Jacob
Consoli¬
Incorporated,
if. r
•
■
Yolume 174
Number 5036
.
.
.
The Commercial and Financial Chronicle
17
(517)
Bank Loans and
Preston Delano in
expansion growing out of arid
aiding inflated ecohomic activities.
Inflationary Trends
Certain
1950 Annual
Report says there is much
misunderstanding regarding causes, of recent inflation. Points
out it is not due entirely to $8% billion expansion of bank
*
of
tration
tion
the
ward pressure on the
ture ,even
nation
the
which
the
in bank
"In
latter
half
of
the
year.
In
this
•
nnection,
the
Comp¬
"In
.
mestic
o m
"
econ-
"
the
United
States,
undoubtedly
the
most
nificant
Preston Delano
sig¬
fact
of the year
1950—particularly the
inflationary
trend at an accelerating tempo.
The
subject of
inflation — its
half—was the
second
;
causes,
ing,
prevention,
course,
effects—has
and
curb¬
been
dis¬
cussed in millions of words with¬
in the last year. Every aspect* of
the problem has been extensively
studied, and the results of that
study have been presented to all
levels of political and economic
activity. Nevertheless, our reali¬
zation of the basic importance of
this matter
dulled,
tion.
should
despite
It
is
become
never
frequent
not
reitera¬
much
too
to
say
that, in addition to being grossly
and
arbitrarily unfair to large
segments of the population, infla¬
tion weakens the spirit of energy
and initiative which is
for
our
nence.
and
responsible
nation's economic preemi¬
It
discourages planning
saving
by individuals and
Despite its temporary
hectic stimulation, it introduces
an element of uncertainty which
businesses.
efficiency
future.
and
an
appears to
have been
misunderstanding regarding
of
causes
the
tionary rise, and
the
relative
a
failure to grasp
force of
and
various fac¬
and
services
interrelationship.
When effective demand for goods
almost
increases,
certain
to
be
is
there
increase
an
in
price levels unless the supply
of
goods and services
creased at
be
can
in¬
rate sufficiently rapid
a
to
satisfy the expanded demand.
Iri 1950, this was not the case. We
have relatively little idle produc¬
tive equipment; we were already
using some raw materials as fast
they
the
could
pool
of
manpower
be
produced;
and
available additional
was
comparatively
small.
In
these
circumstances,
prices were certain to rise as peo¬
ple had more money to spend and
"What
which
the
were
the
increased
tendency
means
by
demand
was
oversimplify
to
a
this
problem by attributing the infla¬
tionary movement largely
billion
loans
year.
in
expansion
the
to
bank
during the latter half of the
For
it has been
some reason,
customary
that
to
effective
overlook
dollar
the
fact
demand
is
made up of two factors—not only
the
absolute
volume
of
money
(credit as well as currency) avail¬
able, but also the velocity of the
turnover of that
"The
outbreak
money.
of
conflict, and various
that
How¬
despite the relatively severe
character of Regulation "X," a
high volume of new mortgage ac¬
tivity con inued through the late
ever,
<
months
of the
fear of
higher prices and the pos¬
sibility that restrictions on civilian
production
of
ages
ished
might
materials
raw
products.
denced,
the
in
create
and
This
field
short¬
fin¬
evi¬
was
of
banking,
counts
/ .This question can. be answered, in part, in terms of the out¬
for general business.
In other Words banking operatiohs
reflect and depend for their Stimulus Upon business.
If business
maintains a high level of activity, bank operations should continue
look
to
show favorable
banks.
The
.
debtedness ~of
total
of
national
such
the end-of the year was less
at
than
-
by the abnormal volume of loans $80 million.
to
retailers for the purpose of build¬
rious
ing
six
inventories
up
terial and
finished
of
raw
goods.:
ma¬
.:
-
things the
va¬
steps taken during the last
months
expansion
At the moment there appears to be a contradictory situation
a recession in the midst of a business boom.
•
wherein there is
;
In
of
to the need
due
was
of regular
for abnormal credit
to
of
1950
of
normal inventories. It would
carry
be unreasonable to expect a bank
to place a 1949 ceiling on its cus¬
tomer's
are
ingly
television
as
the
;
a
check
to
for this
the
foregoing discussion is in¬
tended to present bank credit ex¬
hand, activity in the field of capital goods, such
is being
pansion in its correct perspective
as one factor
although by no
—
Korean
crises
since
hoped
lost
scare
equipment expenditures of industry are scheduled at a record
through the remaining months of the year.
At the same
time, outlays for defense will be increasing at a rapid rate and
influencing business activity to an increasing extent.
Barring
some major reversal of trend, business activity should remain at
high level through the remaining months of 1951 and in 1952.
Under these conditions bank loans should remain high.
In
a
seasonal
fact
the
over
f
that
sight
basis.
influences
several
next
fewer
of
bankers
basic
this
are
likely to be an important influence
and some expansion in loans to
months
supply the normal business needs is expected. With bank loans
now near the peak it is probable that a new record in loans will
be
*
'
established.
The expansion
of
last
this fall, however, should be considerably less
A large part of the huge expansion in
December, 1950, was the result of
than
that
bank
loans between July and
prices
rising
year.
the
and
accumulation
of
months inventories have declined from
It is to be
some
have
cases,
inventories.
In
recent
previous record levels.
In
however, they still appear to be in excess of actual
needs, especially at the retail level. While some further adjust¬
in stocks is likely, it is believed that a decline here will
principle
ments
the sole or even chief fac¬ during the past year than have
done so in our earlier inflationary
tor—contributing to the rise in
Nevertheless, when
price levels during 1950. By pro¬ experiences.
the
international
situation
be¬
viding a part of the means for
comes
more
settled, more than a
premature
and
excessive
pur¬
few borrowers, and their banks,
chases, in an economy already
be
means
largely offset by rising inventories for defense purposes.
Thus while the period of rapid expansion of inventories
is
stocks should still be maintained at a high level necessitating
a large volume of bank credit.
V
?
As the defense program accelerates over the next few months,
the current price weakness in some products is likely to disappear.
Price controls, material allocations and higher taxes, however,
pressing against its productive- may be confronted with definite
loan repayment problems.
should help to keep prices down, so that the sharp price advances
capacity ceiling, some lending by
which occurred last year is not likely to take place again.
banks was adding to the pressure
"Despite such hazards, whichThus increasing prices which was one of the main factors
are perhaps unavoidable in a freein the inflationary engine.
tending to increase bank loans last year will not be so important
"It
is
noteworthy
that
the enterprise system, it is believed
growth
among
but
in
loan
volume
occurred
national banks of all sizes,
somewhat
was
more
pro¬
nounced among the very largest
city banks, probably, because the
greatest credit demands during
which
dealt
the
national
United
primarily
adequately equipped—in its sense
in
public responsibility as well as
numbers, personnel, organiza-
tion, and resources—to discharge
creditably its vital functions in
the our dynamic economy."
larger banks, capable of furnish¬
of
the 4,965 banks in the
national banking system, the 126
banks
with
deposits in
excess
the
loan
increase
during 1950
($3.8 billion out of $5.4 billion to¬
tal).
4,535
posits
which
were
the
and
Cook,
Building, have
ver
Fla.—Sha¬
Florida Theater
announced that
PETERSBURG,
other
national
responsible for only 14% of
"Without
doubt,
1950.
Mr.
Grobert
securities
banks
20
has
business
been
for
in
the
the
past
and was formerly asso¬
spontaneously exercised restrictive ciated with such firms as Halsey,
many
lending policies in
a
over
considerably below that of 1950.
*
continuing high level of loans and improved interest
those
of
last
year,
income
operating
show further gains.
of
the
banks
*
will be determined to a large extent
able to carry through to net income,
pated many banks will be
ST.
extreme* the Carl W. Grobert became a gen¬
banks with
de¬ eral partner as of Aug. 1, 1951,
of less than $25,000,000, and the firm name will now be
hold 23%
of total loans, Shaver, Cook & Grobert.
At
With
rates
by the nature of the Federal income tax bill. Current indications <•
are
however, that unless the tax is more severe than now antici¬
of
$100,000,000 held 63% of the total
loan volume, but originated 70%
of
should be relatively modest and
Final results for the year
Shaver Cock Grobert
for
expansion of bank loans last year—inventory accumulation and ;
rising prices—are not present today to the same degree as they
were a year ago.
While some further increases in loans to finance
increased production resulting from the acceleration of the de¬
fense program and normal seasonal business gains, the expansion
should
ing credit in the required volume.
Thus,
/
months.
all, the factors which were primarily responsible
in
All
point of the twentieth century, is
of
next six
in the
banking system
concerns,
with
over,
States, at the mid¬
from major indus¬
commercial
and
.
that the
of
some
gain in earnings.
1
■■■'
..
.
BANK
NATIONAL BANK
and
oi INDIA, LIMITED
INSURANCE
Bankers to the Government in
Kenya Colony and Uganda
Head
STOCKS
Office:
26, Bishopsgate,
London, E. C.
years,
effort to do Stuart & Co. Inc., A. C. Allyn,
their share toward maintaining a J. Arthur Warner & Co., and his
stable economy, regardless of the last connection before coming to
excesses of others.
The situation, Florida wds with Edelmann &
however, called for a more con¬ Capper. He has been a resident of
sired materials and products.
Florida for the past, two years,
As certed and cooperative effort.
a result,
money which had been
"Starting in July, steps were making his home in St. Peters¬
idle became active, and money taken to stem the tide of credit burg.
high
probably lies in a number of factors.
buying of last summer and fall was unusually
high and probably was borrowed from current business. A large
part of current income is likely committed to repay instalment and
mortgage debt. The threatened shortages of last year have failed
to develop and the current high prices have resulted in people
spending less freely. Also, higher income taxes have reduced the
spendable income of many people.. •
;
Most of these factors are of a temporary nature. The plant
are
short-term
a
A
rate
credit appears to be good, at least
on
con¬
and
Bis legitimate riods of expanding activity and
needs.
rising prices, almost everyone's
uninflated
in various
as
condition
The
have
credit .could
of Credit for
"The
ago.
year
A similar situation exists in textiles and
of capital investment such as is taking place currently is
usually accompanied by strength in retail sales. The explanation,
1950
the loan increase in
stimulated waves of
buying in excess of immediate
nfeeds,
because individuals and
business concerns anticipated both
higher prices and shortages of de¬
event,
and
sets, automobiles and refrigerators
considerably from'recent rates and in some
down
below
goods, price reductions and cut backs in operations
have been made to bring a better balance to inventories.
becoming increas¬
effective as this report is
written,
such
slowed
groundwork for further efforis in
1951, which
items
cases
sumer durable
"However, it should be em¬
fect.
Joined with that of other
phasized that, as a result of higher
essential anti-inflationary
meas¬
price levels, a large part of the
increase in commercial bank cred¬ ures, however, they provided the
customers
important consumer goods markets, supplies for the
over a yeah have caught up with sales.
In fact, sales
have
T
comparatively little immediate ef¬
it
the
first time in
-
"In the nature of
manufacturers, distributors, and
business activity turns down, this
banking operations.
in
rate
in¬
banks
If
results.
reflected
On the other
Reserve
ent
be
steel, copper, aluminum, chemicals and machine tools,
maintained at a very high level.
'•
•
This paradoxical situation is unusual for business.
were
borrowing
moderately from the Federal"
System and correspond¬
very
also
would
as
banks
—
question arises—what
5
year.
the widespread impulse, already Governors of the Federal Reserve
increased
the
discount
mentioned, to increase business System
rate from 1M> to 1 % %. However,
inventories
beyond normal vol¬
the direct effect of this step was
ume and to buy consumers' goods
in advance of actual need.
The necessarily limi ed, because — de¬
origin of this impulse was the spite greately increased loan ac¬
trial
There has been
made effective?
$8.5
With a good six months now past the
about the prospects for the second half?
credit for
upon
.
the year came
willing to spend it.
were
was
bank
was
during the second half of
<Tn August t£ie Federal and
and some portion of this
undoubtedly made its contribution state bank supervisory authorities'
issued
a
'Defense Loan Policy'
to the inflationary advance.
statement
and
requested
banks
"A
relatively
small
part • of
and other financial institutions to
bank
credit
expansion
during decline to
make loans that might
1950
reflected
the financing
of
be used for speculative purposes
defense-engendered conversion or
or
otherwise, interfere with derconstruction of plants and equip¬
fense requirements.
ment. A certain portion of the ex¬
"Also in August the Board of
pansion undeniably was due to
infla¬
recent
their
tors
as
in
"X,"
first half of the
generally favorable.
Despite increased operat¬
ing expenses and the necessity of providing a larger portion oif
operating income for Federal income taxes, most banks were able
to show earnings equal to or above those of a
year ago.
t
.
'"There
the
there
increase
curb,
residential real estate.
new
accounts, tills and pockets.
substantial
a
Regulation
money
increased.
additional
an
current year were
applied, through Federal Reserve
any
fact, however, the volume
source
much
This Week—Bank Stocks
Operating results of commercial banks for the
"In any economy undergoing a
borrowings, thereby substantial degree of inflation and
foundations
forcing him either to curtail nor¬ loan expansion, credit hazards are
expanding
mal operations or to seek another definitely increased.
During pe¬
undermines the sound
of
By H. E. JOHNSON
1950,
do¬
of
y
quantity of
of
credit
stated;
the
placed into effect, in
in order to conserve
October
price struc¬
absence
of available money also
As indicated previously,
co
troller
the
in
increase in the
manifest
particularly
ip
Veterans'- Administra¬
generally passed from hand to building materials needed for na¬
tional defense. In
^September Fed¬
from account to account,
eral
Reserve
Regulation
"W"
more rapidly.
This utilization of
again
became
effective,
thereby
idle funds and more rapid turn¬
In
over would
have exerted an up¬ restricting - instalment credit.
trend
was *
or
were
that month,
inflationary
in
Bankand Insurance Stocks
or
hand,
ton Delano gives his views of the
causes
mortgage
insured
on
guaranteed
by the Federal Housing Adminis¬
loans in last half of 1950.
In his recently released Annual
Report covering the year 1950,
Comptroller of the Currency Pres¬
restrictions
financing
Ceylon, Kenya
Branches in India, Burma,
Colony,
Kericho, Kenya, and Aden
and
an
Zanzibar
Subscribed Capital
Paid-up
Reserve
_£4,000,000
Capital———£2,000,000
Fund
£2,500,000
The Bank conducts every description
banking and exchange business
Trusteeships and Executorships
also undertaken
of
Laird, Bissell & Meeds
Members New
Members
York Stock Exchange>
Exchange
New York Curb
120 BROADWAY,
NEW YORK 5, N. Y.
Telephone: BArclay 7-3500
Bell
Teletype—NY 1-1248-49
Trading Dept.)
Specialists in Bank Stocks
(L. A. Gibbs, Manager
The Commercial and Financial Chronicle
(518)
18
have
delicate
the restrictive
between
excise
sales
and
further check
taxes
as
inflation.
on
All
these moves indicated
an
its
the integrated economic program with
the United States.
The success of
past six months have seen funda¬
cate the
Western
authorities
States
United
the
from
of cheap and abun¬
to one of relatively
era
an
credit
dant
and dearer credit has been
scarce
is contend¬
ed, have not yet been felt by
sections of the community.
result
the
of
It
is
series of comple¬
a
rediscount
The
moves.
Bank of Canada
of the
rate
large
was
of
has
Due
behind
demand
ing
the
of
and
bond market.
regulations, together with
control of building supplies, were
be
during
employed
of
months
1950.
of last year,
the
closing
Toward the end
the Bank of Canada
began to allow the market to ex¬
ercise
an
increasing
influence
the
bond
Investors appear to
a
money.
generally
dearer
the
total
elected
capital
change
and
and
of
the
United States,
in
is
balance
attracting
the
in
time,
same
regulations
credit.
credit
consumer
were made more
The
orous.
bank
contained
new
rig¬
Canadian budget
in-
of
announcements
count
merchandise
on
ac¬
was
merchandise trade
<
stability."
conclusion
drawn
unrealistic
be
to
by
more
that
be¬
rather than less sensi¬
tive to international events."
did not contain any
r\s.;
••
;
.
I
v 1
taxes
the
Thomas
King to Join
Provincial
f
the
pay-as-you-go
rents
In
Two Wall Street
NY
consumer
and
view
the
Bank
of
the
Flanigan, Chairman
of
Directors
a
of
Mr.
Senior
Vice-
Kilpatrick,
the
bank,
Di-
a
well
as
as
member of its General Adminis-
trative
with
is
the
1933.
made
was
Vice-President
Trustee
ings
old
Bank,
of
the
in
an
1937
1938.
Harlem
business
Canadian
of
Public
offering
Market
o.f
$73,000,000
Federal Home Loan
Banks
2.20%
the
by
Northeast
in
or
being
of-
National
Bank
dation
Cor-
to
in
Board,
be-
the
trust
the
Cha-
1932 when
merged with
was
the
He
Seaboard
Insurance
is
Di-
a
Fire
Ma-
Co.; Taylor-WharCo.
National
Hooper
with the
career
Bank
York
Mr,.
and
of
Commerce
became
He
1929.
is
a
associ-
of
native
^
mi_
The
merce
i
r>
~
Belgian Chamber of Comthe
and
Tounst Bureau
Official
are
Belgian
the joint spont
•
pr«
dows °f the Colonial Trust
Rockefeller
Avenue
Fortv-Fi^hth
Center
the
of
office
Americas
Street
at
York
New
Philadel-
Co., both of Phila-
of
the
two
banks, subject
by the Comp-
confirmation
effective
come
business
the
at
the
Sept.
on
consolidated
for business
21,
bank
close
of
that
and
will
open
Monday, Sept. 24.
on
The consolidated
bank
will
ate under the charter and
oper-
name
of
The
Philadelphia National Bank,
originally announced June 19.
as
„
T.
.
_
A
ep1fr.lc,^
...
_
_
..
,
A
President of
.
The Philadelphia National Bank,
that J. Wilson SteinBresident of The Ninth Bank
Trust Co., will be elected a
Vice-President of The Philadelpbia National in charge of branch
offices in the Northeast section of
the city, and that the officers and
announces
staff of the Ninth Bank will
con-
tinue in the employ of the consolidated bank. Mr. Potts also stated
s that present directors of the
Belgium and the Belgian Congo
currently on display m the winpany's
The
troller of Currency. It is expected
that
the
consolidation
will
be-
Iron & Steel Co. and the Her-
Creamery
Trust
2, formally approved the consoli-
New
with
of
delphia, .Pa., in meetings on Aug.
the
Company
in
&
Forma
associated
ol
Stockholders
phia National Bank and The Ninth
He
Dallas, Texas.
on
presently
Bank.
of
the
S?ri3 ? -an ex^tl(£
on
fered
Co.;
°f
FHLB Notes
the services
Director
Dock
Administrative
Co.
will be dissolved.
an
both
National
Sav-
ated with the Manufacturers Trust
IIP.—Thomas E.
King will join Dempsey-Tegeler
& Co., 209 South La Salle Street,
about Sept. 1, it is reported, and
the firm of Thomas E. King & Co.
of
Northeast
Bank Presently has three offices
Manufacturers
He
Vice-President in
a
a
of New
CHICAGO,
stockholders
The
Board, began his banking
in
begartfhis hanking
Thomas e. King
banks.
templated in the personnel
office
of
rector
ton
Commerce, revenues at
the rate of the elapsed part of the
1-1045
.
.
created
President.
rector
policy
The budget thus is
a
Manufacturers Trust.
integral pprt of anti-inflationary
policy.
.
'
New York 5, N. Y.
4-2400
to
spending.
INCORPORATED
WORTH
a
Board
company
all,
Ihe
been announced,
but it will probably be completed
in the early fall. No change is con-
Trust
formulated in 1939 and to add the
feature of flexible financial deter¬
A. E. Ames & Co.
#
P™val of the supervisory agencies
tham & Phenix National Bank and
the budget may be considered to
restate
.
merger has not
came
preciation allowances were sus-;.
pended for a period of four years
on
all assets created after April
CANADIAN STOCKS
former
Harry C. Kilpatrick, Charles
Corporation
in
*
that
shey
All
j?a„
Jor^BankmgTa?d
Philadelphia and C. John
Hill Jones and Eugene S. Hooper,
have been advanced to the newly
goods containing essential mate¬
rials than raising revenue.
De¬
industries.
cnwn/iwfr
located in the Holmesburg, May-
Municipal
basic
Kurtz, President of The Pennsyl-
_r„M!_
Trusts of
f?ir and Tacony-Torresdale secHons. The effective date of the
rine
1951, with certain exceptions
r'. '•*•
Fulton
of
increased, but more with a
view
to checking purchases of
10,
i;T.:: \'
William
1
Manufacturers Trust Company, of
New York, announced on Aug. 6
eral
by
surcharge,
for
Aug.
Birkmann, President of the North-
Avenue.
the
in ithe. Upper sPark
were
/ V.-fc;
fi
o
poration; Bing and Bing, Inc., etc.
Mr. Jones, a member of the Gen-
about
Government
A^P
Auh.
Madison
replaces
C.
the
York
corporation taxes were raised to
the 50%
level, and the
existing sales tax of 8% was raised
to 10%.
In addition, excise taxes
,
1
;
On
and
Horace
of
and
structure.
20%
$1,500,000.
.
...
nn
on
capital
principal
Branch, located for
at 96th Street and Park
Assistant
Dempsey-Tegeler Go.
federal
increased
,
new
and
post
Trust
fundamental
tax
were
the addition of a
CANADIAN BONDS
; V' \ .'
in
Income
amount of
3Vz%
aggregate
Park
career
•
new
■' '■ !
„
its
-■
assume
budget, like that of United States,
changes
of
branch
same
during the first
Canadian
issue
the
in
*
.
Street
91st
Branch.
decline in the amount of those
The
of
to
company
notes
91st Street
Branch at the northeast corner of
ings will assist in the achievement
come
six months of 1951 has resulted in
reserves.
Company,
tif
tf
annmmfSd
announced
York6
York,
opening
of economic
every indication, moreover,
the Canadian economy will
foreign
a
Trust
«...
Upper
that, because the international
political tension has eased, the
$300 million.
While
exchange
reserves
in¬
creased sharply in 1950, the con¬
unfavorable balance of
About tinuing
February the Bank of Canada an¬
nounced a program of credit cur¬
tailment designed to restrict the
increase
deficit
the
.™
purchasing power, but does
yield rates. These increasing attention in Canada. In
however, proved to be in¬ 1950, Canada had a current ac¬ Western nations can relax and
by themselves to check count deficit amounting to $316 neglect the implications of the
the large inflationary forces grow¬ million, the first since 1933. Dur¬ defense
economy
in which we
ing out of the Korean situation, ing the first five months of 1951 have elected to live. There seems
in
Bank
*
with
sufficient
as
director of the Corn Ex-
a
25) the New York State Banking
Department authorized the trust
New York,
government
investment in
moves,
and,
Nichols, Jr., PresiEngineering &
Corporation, has been
of
This
would
bond
upon
W,
Research
consumer
the
bank is that "at the mid-year, it
.
trade
stable or
a
Charles
dent of the Nichols
only be financed by expand¬
ing
the
money
supply,
which
action
provides
the community
The
The reversal of the nation's for¬
eign
armaments
%
'
increasing
*
and
taxes
divert
to
^
take account of increased corpora¬
tion
compli¬
1
.
relationship between
stock prices which will
and
Bankers
and
OFFICERS, ETC.
CAPITALIZATIONS
^
0
:Phia» announcedthat the board of
not result in an increase in the 21 years
directors of each institution has
supply of consumer goods. In this Avenue. The new branch, in its agreed to a merger of the Northown modernly equipped
building,- ,,ea^ National Bank into The Pennsituation, economy of expenditure
by .all levels-of government, will be in charge of ^Manager ^ SYivania/^ Company.-The .merger
Clarence
V.
credit restraint, taxation and sav-,
Horan, who held the agreement as subject to the ap-
narrow¬
attract funds from the stock to the
seeking
NEW BRANCHES
NEW
REVISED
can
spread between bond
yields has r served to
stock
CONSOLIDATIONS
capital goods exceeds the total of
taxes and saving, the deficiency
Canada.
and
to
If
spending
policy, the supply of funds for in¬
vestment
in Canada has lagged
increased last year and consumer
credit
in
goods
cies.
the restrictive monetary
to
News About Banks
of
and
goods will upset stabilization poli¬
the
easier
made
undertaken
',
world.
purchasing power from
declining
volume
of
of
Bank
Canadian
the
Commerce,
task
rapidly but the ef¬
accomplished
fects of this change, it
mentary
view
effects
policy
economic progress of the
failure
"A
in
in the Canadian
financial world. In the view of checking the ijate of increase in
this leading institution, the major their domestic price level and in
development has been the check¬ exercising a mitigating influence
ing of the monetary expansion of upon the prices of internationally
goods, according to the
the past five years. The transition traded
changes
mental
fiscal
and
America will continue to
in
contained
very
a
"Monthly Commercial Letter,"
Commerce,
a
achieved,
inflationary forces arising out
protracted defense program,
inflatipnary pressures in North
of
a
con¬
the
By WILLIAM J. McKAY
creased
be
can
Thursday, August 9, 1951
.
on
of
Unless
balance
monetary
According to the mid-year re¬
view of the Canadian
Bank of
impact
stockpile
goods.
sumer
Canadian Securities
unfavorable
an
domestic
the
..
Bank
will
serve
as
Ninth
local
a
Ad-
visory Committee. The consolidatiori will mark the entry by PhilaHolnh-
,c
nl<q
.
,
„
,
'f.
?n7n
,
,
"
irdo neighboihood banking with
expanded facilities to do a trust»
SLvmgs
and safe deposit business.
The
be a Series C-1952 Consolidated Notes,
as a
to the ecobudg¬ non-callable, dated Aug. 15, 1951
nomic progress
progress and
and develonment
development
eted expenditures, and while the and maturing Feb. 15, 1952 was
consoijdated bank wm have
achieved by Belgium in the postcombined ca ita,
greater part of defense production made on Aug. 7, through Everett
Ius
d
war
period,
the
display
will
recommitments, budgeted at some Smith, fiscal
diyided
{
agent.
The notes
$67i0oo,o00
;mam on view until early August
$1.3 billion for the current fiscal were priced at par.
and total resources
of
Arthur S. Kleeman, President of
year, may well be contracted for,
The purpose of; the issue is to
$830i00o,000. In addition to .Us
the banking house, announces that
there is a iikehood that this amount
thi-ee centrally iocated
refund in part $116,000,000 Series
The
m
conjunction with the exhibit,
will
not
actually be translated C-1951 Consolidated Notes ma¬
Philadelphia National Bank will
Colonial Trust Company will.disinto production.
Actual expendi¬ turing Aug. 15, 1951. Of the $116,operate the fiye Njnth Bank
tures, therefore, seem likely to be 000,000 notes maturing, $43,000,-
indicate
year
considerable
Fifty Congress Street
Boston 9, Mass.
there
margin
will
Arran^d
over
tribute
in^^ess
office^
Qf»
ROOM FOR GROWTH—
IN CANADA!
such
Canada's thriving
economy and
sound
financial
policies lend
themselves favourably to invest¬
Our
ment.
Canadian
benefit
able
to
long experience with
industry will be of
you in selecting suit¬
investments
in
this
fast
Correspondence invited
%
The Toronto Stock Exchange
The Investment Dealers' Association
of Canada
Brant ford
in
rent
Windtaa
Brampton
a
000 will be redeemed
pressures
in the
Canadian financial
ing, oustanding consolidated ob¬
ligations of the Federal Home
cur¬
Loan
situation.
ahead;
a
may
be
wage
scales provided in
concomitant
a
increase
have
been
re¬
departure
in
the
with the current
issue, Mr. Smith
said. In the past, he stated, deliv¬
new wage
ery
steadily increas¬
inflationary signifi¬
Furthermore,: shortages of
raw
materials, which seem
•
of
likely to become more acute as
defense production expands, will
exhibition
graphs
the
and
mono-
the
outgrowth
of
several visits to Belgium by Mr.
Kleeman and by Mario Dies Vicei: are
International
DiVisfnn
Interrj,ational Division.
*
The
Rochester,
was
made
only
at
$2,200,000,
shares
York, but delivery of the current
par
madk at
the Federal
Reserve Bank of Chicago, as well
the
as
at
of
New
Federal
York.
-
Reserve -Bank
N.
8>
share
f
each
Bank
^
&
j
u
stock
NPtional
Philadelphia
h
Trust
of
The
Bank
for
0f The
Co
held
themn
b
stockholders of The Philadelphia
S National Ba"k will continue
tain
1
*
Ninth
the
presently
share
hold.
to re-
certificates
An
item
they
bearing
on the proposed consolidation approved in these columns June 28,
a certificate of
Pa§e 2685.
capital stock from-'
'
*
**
*
Trust
Y.
on
Company
June
25
of
re-
ceived approval to
,the Federal Reserve Bank of New
issue will be
Central
reduction
notes
cance.
all
one
the
de¬
livery of the notes is being made
in
ing labor, income resulting there¬
and from full employment,
an
new
ex¬
from
have
A
tightening labor situation
the
will
teSaiS^1^:
^^fco °wmer ^
Recovery Through Imports." Both
to
$504,500,000: from the
$547,500,000 currently outstanding.
in the months
with
Banks
duced
Thus, it is stated: "The scheduled
increase in defense spending, the
increase
with cash.
Upon completion of the financ¬
the budget.
recognition is given to the
inflationary
all
Bay St. Toronto, Canada
SudburT
Full
agreements and
Members:
Hamilton
lion anticipated in
pected to
jMLilner, R^oss & Co!
830
result
momentum of which
growing neighbour.
.
to
year-end
surplus greater than the $30 mil¬
as
consisting
preferred
of
stock
50,000
of
the
value of $20 each and 60,000"
shares
par
of
of
of
common
stock
of
the
value of $20 each, and 60,000
000, consisting of 72,000 shares of
common
stock of the par
$20 each. At the
same
value of
time (.June
-As of July 31 the First National
Bank of Akron, Ohio, increased its
capital from $1,000,000 to $3,500,000 — the increase having been
brought about by a stock dividend
of $1,500,000 and the sale of $1,000,000 of new stock. Details of
Hue plan whereby the capital is
Volume 174
Number 5036
The Commercial and Financial Chronicle
...
19
(519)
enlarged
embodied
were
bank to McDonald &
in¬
Chairman, National Public Educa¬
the
tion
in
formation submitted July 5 by
Company of
Cleveland,
representative of
underwriters,
from
which
Committee
Institute
of
the
activities
we
the
include
National
Commission
quote:
"On
July
1951,
5,
holders of the
increase
in
bank
the
presently
shares
of
the
share¬
approved
value
par
an
of
the
outstanding 200,000
stock
common
Bankers
the
past
Public
Education
the
American
of
the
Executive
National
De¬
posit Association.
Walter
E.
Assistant
of
was
of the bank's
common
said
shares
200,000
value
of $10
a
par
share to 350,000
per
shares
common
stock from
with
with
a
value
par
Los
standing 200,000 shares of the
par
fornia
value of $5
ex¬
when he
share will be
per
shares of
new
stock with
a
value of $10
par
share and 50,000
per
of the
shares will be distributed
possible
as
as
shareholders
four
new
as
of record
July 5,
share for
one
then
shares
held,
and
the balance of 100,000 of the new
shares
of
being offered to holders
are
stock
common
of
record
on
July 5, 1951, for subscription at
$20 per share and at the rate of
share for
one
shares
two
of
stock held at that time. It
common
should
each
be
noted
dividend of
that
the
stock
50,000 shares will be
payable
only to holders of the
200,000 shares outstanding prior to
July 5, 1951. Upon the completion
of
the
exchange (which is con¬
by the Comptroller of the
Currency to be a stock dividend
strued
as
to the increased par represented
thereby)
stock
the
and
of the
50,000
and
the
dividend
additional
bank
will
500,000
100,000
show
and
of
sale
of
shares the
Bank's
bank
has
been
National
a
Banking Association since April 1,
1947. Prior to that it was incorpo¬
rated under the laws of Ohio and
known
was
The
as
First
Central
Trust Company. Under that
it
began
1934,
name
operation on Jan. 15,
the reorganization of a
as
bank of the
same
incorporated
laws of Ohio
originally
name
in
1890
under
the
The Peoples Sav¬
as
ings Bank Company.
%
V
£
of
Nashville, ' Tenn.,
increased
its
effective
July 20 from
$300,000 to $500,000 by a stock
Farmers
&
Bank
Los
of
been
First
Directors
National
tion
of
Bank
announce
Marshall
for
Mary
A.
of
The
of
Fort
the
elec¬
Fuller
as
Chairman.
The
in
become
the
effective
of
August
anniversaries
marks
of
four
members of the staff of California
Angeles.
complete 30
Gardner
Kruse,
and
Assistant
of
service,
Assistant
Richard
J.
Cashier.
A. Elder, Assistant
Washington
Two
years'
Turrill,
Vice-President,
George
Manager of the
Vermont
and
year.
meeting
was
of
held
Room
of
preparing the new educational
program for the fall semester of
the
Los
Angeles
American
which
of
the
Chapier
Institute
is
the
of
American
the
of
Banking,
educational
section
Bankers
Asso¬
Victor H.
The
Rossetti, President of
Farmers
tional
Bank
&
of
Merchants
Los
with
the
bank.
with
California
Office,
Bank
as
Co.
in
Cal.
year
Rossetti
Fargo
San
3,
Farmers
Bank
Mr.
Wells
July
on
the Cashier's Department. In
June,
1943,
he
elected
was
1944,
moved
Bankers
is
and
&
and
the
joined
Merchants
Cashier.
as
Francisco
1911,
&
Bank
He
National
was
elected
elected
was
President.
of the bank
sources
Total
re¬
of June
as
Department.
Chapter
He
Secretary,
Bankers
of
has
Group
30,
on
fornia Bankers
man
't
of
the
running
as
1966/71s, the 1952
was
active and not too
broad government market con¬
tinues to push prices through or against the tops of the established
trading
Demand is spotty and not too sizable for
area.
issues that
being bought, but
are
Mr.
Nebraska Undertakes
of
Securities
to
sure
time to come.
some
liquidate these issues
Nevertheless, there is
of
the
State
bureau and to promote
licensed
on
of
As
public
dealers
a
time
in
the
market.
action of the
to
This
opportunity to
seems
the
be
market.
soften, liquidation also
an
to
seems
government
to
dry
is
re¬
result of this
being drafted
now
heavy emphasis
investors.
Included
reau's schedule
are
educating
on
in
an
the
advertising
direct
mail
advertising
program aimed at specific groups,
a
new
brochure
explaining the
services
of
the
Bureau
and
of the Los An¬
the
American
also
5,
served
in either
direction, although there is still
of bearishness around.
a
to
is
rectify the situation. The
newspapers.
Waddell & Reed Add
mainly due to the lack of size and volume in the market.
111.—George
E.
as
ford is with Waddell & Reed, Inc.
Kansas City.
a
Joins Eaton & Howard
(Special
to The Financial
Board,
"Southern California Banker," and
getting too far.
The
''*• '
has been
from pension funds.
Although there
from
as
these sources,
small ones,
to have
are
a
on
the
New
York
Exchanges.
and Detroit Stock
"
and
'
•"
still is coming
whole these purchases
Robert
1967/72s
get the
and for the present it seems as
issue,
among
are
done by pension funds, with profits
up
at
2333
Mt.
Foley, President, and
George H, Pittman
N
Vice-President.
(Special
-
of
to The
Company]
Financial Chronicle)
gaging
in
a
securities
from offices at
536
business
West Wiscon¬
sin Avenue.
the June and
Nonetheless, the
not without appeal to them,
U. S. TREASURY
Some switching is also being
being taken
on
STATE
certain obliga¬
and
supervision of trust companies, have been
companies. To be
sure,
as
have certain
MUNICIPAL
these purchases have not
been large, but nonetheless they do help to keep the market within
SECURITIES
trading limits.
Long Partial Exempts in Favor
As
for
continue to
the
be
bank
the
issues,
in demand
from
longer-term
are
the leaders at this
have
no
As
a
partially-exempts
commercial banks
both
in
and
The 1960/65s and the 1958/63s
time, with the 1956/59s and the 2yss not
matter of
fact, these four obligations
difficulty in finding homes,
might be in preference at the time.
irrespective
of
seem to
which
one
The out-of-town commercial
Aubrey G. Lanston
banks, which have savings deposits, continue to bite off not too
the
supply helps
to
keep the market
security.
v
In this
case
& Co.
also
:
limited
balanced
Despite tight money conditions, the short market has
tone, with the deposit banks,
corporations and
investors active in this end of the list.
cates
seem
to
be getting
certain
a
good
nonbank
Treasury bills and certifi¬
most of this demand.
INCORPORATED
in this
Z\'/ V.''
»■;
MILWAUKEE, Wis. — Oscar
Brachman Company is now en-1
buy the 1963/68s.
Trust funds, under
recent
offices
-
though the 1963/68 is the favored
the 1952 eligible issues.
tions in order to
,
The issues that
means
of the funds.
bulk
eligible restricted obligations
near
under
S.
Harrison
the whole restricted list, but the income
cover
angle is still most important to them and that
December
J.
Treasurer;
mainly
made
are
constructive influence upon the market.
a
Building
of
Co..
with
formed
but when taken altogether, they are important enough
being bought
Oil
name
Oscar Brachman
occasionally sizable orders
are
Utah
firm
Diablo Boulevard to engage in the
securities business.
Officers are
in Treasuries, especially
sizable amounts of the 2V2S due Sept. 15, 1907/72.
(Special to The Financial Chronicle)
also
CREEK,
Calif. —
Highland Securities Co. has been;
It is
side, the sell¬
up
from the old1 tops.
away
higher income obligations,
too far behind.
With Watling, Lerchen
Mr.
were
(Special to The Financial Chronicle)
greater participation by those that
buying that has been going
Chronicle)
BOSTON, Mass. — Sherwood E.
Bain has joined the staff of Eaton
& Howard,
Inc., 24 Federal St.
firm
WALNUT
funds, the market is going to be vulnerable to set¬
outside of the large money centers.
Chairman,
DETROIT, Mich. — Robert A.
Education, Cali¬ Benedict is with Watling, Lerchen
&
Assoication; Chair¬
Co., Ford Building, members of
Editorial
from
Glass-
of
which
Highland Securities Go. ij
ing byihohBank'owners of Treasury bonds should prevent prices
(Special to The Financial Chronicle)
PEKIN,
T.
-
Brothers &
for the feeling of uncertainty
reason
nibbling here and there at the earlier eligible taps
and
with
and Mr. Seebass
the
the
It is believed there will continue to be less
fire and casualty
radio
John
are:
SALT LAKE CITY, Utah—Har¬
rison S. Brothers is engaging in
selling if quotations should turn reactionary. and this should help
an
infor¬
Associated
office
not unimportant amount
dramatic
and
Building.
new
Harrison Brothers Firm
•
in
designed to give
California
Goode
This negative kind of market, which is the
way some operators,
characterize the present one, is not likely, however, to go too far
newsworthy
to
York
New
the securities business from offices
editorial program
mation
the
associated.
its composure.
recover
Bank
the
Denver,
Bearish Attitude Persists
Bu¬
program using general circulation
a
tendency
a
of
office in the First Na¬
Seebass, Jr. Mr. Webb was for¬
merly President of Otis & Co. of
and the market is given
up,
an
R.
more
the-current
to
answer
When prices show
•
Webb, John H. Goode and Alfred
pres¬
a
members
with
orderly and stable market for government obligations. A piece¬
letting out of the securities that must be eliminated could be
taken care of by the purchasers that are
appearing from time to
and
public relations program for
media,
no
and this should result in
now
"
Midwest Stock Exchanges} is
tional
Pension Funds Active
Signed to probe into the field of
advertising the services of the
a
Co.,
and
opening
same owners of
government securities. The nonbank holders
long-term Treasuries, particularly the life insurance companies
and savings banks, are going to continue to be sellers of these
securities for
-
•
of
Bureau
Nebraska has recently undertaken
a
test
advertising program de-
test
•
DENVER, Colo.—Cruttenden &
limited, so that the tone of the market remains satisfac¬
The decrease in offerings by holders of Treasury obligations
tory.
Advertising Program
Neb. —The
Cruttendei) to Open 1
Office in Denver
are
is probably the
have available
and
Turrill
of the
any
the other hand, offerings
on
•
likewise
earlier, Mr. Rossetti reported,
Association;
Committee
too
pointed out that until there is
January,
Banks
Institute of Banking and the Cali¬
fornia State Safe Deposit Asso¬
ciation.
not
last, amounted to $305,381,707, as
compared with $294,413,568 a year
Assistant
in
the
to
past President
geles
The 1965/70s, the
the
Market in Narrow Area
A
en¬
Vice-President in 1917 and in 1931
a
messenger in 1921 and by 1924 had
been elected Assistant Cashier in
Vice-President,
in
were
III
Murphy
Charles, O'Brien Murphy III,
Merrill Lynch, Pierce, Fenner &
Beane, New York City, is cele*
brating his birthday August 16th
and congratulations are in order.
the longest bank
bond, with the shortest issues not without attraction.
banking business in 1893
the
Trust
Na¬
Angeles,
recently celebrated his 40th
begin
staff of
would get a not too sure nod.
eligible taps also
O'B.
C.
meal
ciation.
Coombs, Head Of¬
their 26th year this
month. Mr. Gardner Turrill joined
the
Tf there were market
leaders, they were not too readily dis¬
cernible, because of the selective type, of the purchases and the
thinness of the market. However, it seems as though the last two
partially exempts, the 1959/62s, and the longest maturing taps
these
Garden
and Gordon C.
fice,
price trend of government obligations.
is
with
viz:
of
■■
not unfavorable effect upon the
a
the Bel Air Hotel. The Committee
the bureau
.
Los
first
the
will
of
This should have
outstanding feature in a market which is attempt¬
ing to gain its equilibrium after a period of sizable liquidation by
7,
elections
them
coming
the Women's Committee
liance
Bank,
Institute
whole
a
likely to be less pressing and
orderly.
more
the
of
Patakas,
Bank
of
& S.A., is Vice-
their salesmen.
President;
as;
month
has
N.T.
Jr.
The
The
Cal.
Chairman
the
Chairman of the Board and J. Lee
service
of
National
Angeles,
Johnson,
Sept. 1.
#
American
America,
July
1931.
Merchants
LINCOLN,
w:';'y'-V/'
Worth, Texas
1928,
Committee, Los Angeles
Chapter,
Banking,
Miss
in
Reed
appointed
Women's
dividend of $200,000.
of
since
as
their lows appears to have passed. To be sure, there is
selling that
must still be done, but it is quite
backs, which could test the old lows. As for the
capital
Board
Cali¬
of
the market
of
#
The Broadway National Bank
The
*
Wanda
tered the
The
staff
*
Mrs.
a
000."
member
a
sistant Vice-President
share
capital of $3,surplus of $3,500,-
a
been
soon
on
be
was appointed Assistant
Manager of the Public Relations
Department. He was. elected As¬
stock dividend to
a
1951, in the ratio of
each
com¬
had
move towards, and
through, the upper reaches of the trading range, and
important period for the investment of funds, and it would not
surprising if some of these gains should be given up. Nonethe¬
less, the pressure which had kept prices from getting away from
an
with
career
some cases
on the constructive side.
Volume and activity are not too
large and demand has been spotty but this is not dissimilar to what
has been going on of late in government securities.
Quotations
showed a good recovery during the month of July, which is always
educated
was
Murphy
remains
began his busi¬
Hathaway
&
Company, San Francisco, in 1915.
ness
He
mon
He
Born in Chi¬
age.
California and
of $10 per share. The present out¬
changed for
of
Mr. Allander
cago,
in
died July 30.
Angeles
54 years
Congratulations
To Charles
Prices of Treasury obligations continued to
in
despite lapses here and there the tone
Allander,
share and approved an increase in
shares
Governments
on
By JOHN T. CHIPPENDALE, JR.
Com¬
Safe
the
authorized
Reporter
Association, and member
Vice-President of California Bank,
of
Our
in
bank from $5 per share to $10 per
number
Send
American
Other
membership
of
National
mittee
the
of
the
of
of
Banking.
15 Broad Street
NEW YORK 5
WHitehall 3-1200
45 Milk Street
BOSTON 9
HAncock
6-6463
20
The Commercial and Financial Chronicle
(520)
..
Thursday, August 9, 1951
.
ahead of him, and it will be
practicable for him to derive sup¬
years
Hear! Hear!
port
Boyle is guilty or not guilty. ... If Mr.
Boyle, as chairman, or while he was No. 2 man in
the Democratic National Committee, received com¬
pensation directly or indirectly for influencing the
R. F. C.- to make a $565,000 loan
Atchison, Topeka & Santa Fe Ry
Atchison,
started
Topeka
&
out the year with
favorable
showing. Net
income for the five months through
earnings
in
share
the
interim
a
the
pay
year
profits tax and without
the
,
phenomenal
last
reported
$31.29
term
vestment
mittedly
a
the
in
Last
year.
from the
of the strongest roads
not only on the
demonstrated
earning
the highest in the company's his¬
tory, appreciably higher even than
conservative debt structure and its
the best
unusually
power,
tating at least
'the
some
earlier
has
necessi¬
The
stock
moderation of
continued
earlier
levels
but
above
year
month stood
at $3,962,592 against
$5,651,597 realized in June, 1950.
Even at that the half-year's share
earnings of $9.71 were still above
date
of
July
President
23,
of
the
will
be established
split stock.
Also,
it
is
on
quite
power
of the
from
U, S, Plywood
Offering
did
to
discuss
in
some
detail
encountered
and the disastrous floods of
June
It
income
will
be
much
lower (5-10% ) than it would have
been,
the
and
demand
for
labor
various commodities will
much
as
to
"will amount to
some
millions of
dollars."
-
and
consumer
a
"The money loss, of course, is se¬
of
Each share of the
our
traffic
in'1951
preferred
common
stock
prior to Aug. 31,
1956.
the
From
this
will
age
and
States
its
Plywood
subsidiaries
j it
Corp.
primarily
collective
is
of
point
of
be
to
expected.
If
retired early they
are
organized
get
that
much
into
groups seeking oldpensions from the government
and out of the general revenue, for
the ratio of their retirement years
to their
United
year
given.
earlier
stock is convertible into 2.4 shares
rious, yet I feel warranted in as¬
suring you that in the light of the
of
new
to
can
retirement and life expectancy are
view
prices declining
after July 1, 1981.
from
means
handbook, if the
surance
workers
at
What it
be rather
quickly calculated from one's in¬
per
$102.50
mize the
volume
high
working
them
for
years
to
will be too
$8,951,272, compared with sales of
Murray Randolph Opens
(Special
SECURITIES
LOS
to
The
Financial
Chronicle)
ANGELES, Calif.—Murray
Randolph is engaging in
ities
Selected Situations at all Times
J
H C
O
(Special
Y.
Telephone BOwIing Green 9-6400
,j
Members Nat'l Assn. Securities
Dealers, Inc.
846
Broadway.
live
15
years-after
retirement.
the end of 10 years, during which
time your income will be standing
still, the income of everybody else
will have increased on an average
about
-
to
The
Financial
relatively
This
course,
Chronicle)
; LOS ANGELES, Calif. — Walter
J. Hesnault, Jr., is with E. F. Hutton &
16%..
feel poorer,
You
for
will
you
therefore
will be
poorer
speakipg, and so you
do something about
will want to
With E. F. Hutton & Co.
Mil
Street.
*
the
riot
fruits
distributed
form
of
the
WW**
if
Would
were
Company, 623 South Spring allow
*
of
to attach much
this
to
observation,
industry is
long
elas.ic and flexible. So
it
as
be measured.
can
American
this
remains
count upon
way
can
we
it to adjust its output
otherwise.
age or
of
distribution for¬
Other
Changes
before the days
upon
Marital and
in
Family Com¬
position.—Between
the
number
increased
of
1940 and
married
considerably,
labor
the
and
em¬
ployers
1950
persons
with
the
benefits
of
of
industry
largely
lowered
everyone
happen,-> of
prices
in
the
which
to- participate
invention..
in
This
each 100 males and 66 out of each
hundred
females
married.
as
being reported
The number of
mar¬
ried couples increased much more
improvements take place in their
rapidly than the population in
particular industries, even though
1940-1950, rising by 24% whilst
many of these improvements had
the population Avas.increasing only
their origin in technical progress*
made
about
outside
the industry.
It
14.5%.
is
This
tendency for the number
of
married
couples to increase
beginning to bring ill-repute
faster than the population is due
upon themselves, and that the de¬
fenses formerly and proper 1 y in part to the decline in the size
For, as I have
made of the price economy are of the family.
being undermined to the detri¬ pointed out, the size of the family
ment of free enterprise and the has long been declining and gives
every promise
of continuing to
welfare of most of us.
little wonder, therefore, that
both
are
But to get back to the collective
point of view.
If the pensionees
feel themselves getting poor, they
will take political steps to correct
their
poverty.
able
eifective
take
to
decline.
steps, as
the Town-
with
send-movement
has
shown.
Al¬
in
3.8
was
is
It
forecast
that
the
size of the family, which
average
1940, will have fallen
to 3.1 by 1980.
/
Families will
And they will be
experience
our
as
not be
%
formed in
large number in the next dec¬
ade
as
past
in the past one.
decade
the
During the
annual
average
ready, in 1960, when the
persons
increase in the .number of married
65 will number
14 mil¬
couples
over
over
was
68(!),000;
lions, the pensionees will probably
holds, 1 757,000.
be able to muster twice that many
votes
since they will
have the
families
support of others for
So
reasons.
a
powerful
variety of
political
a
movement, if well organized as it
most likely would be, could take
periodical steps to elevate pen¬
sions.
it."
'&>.
New York 4, N.
secur¬
business from offices at
South
25 Broad Street
a
.
oligopoly.
much
$69,235,468 and profit of $4,458,699 } Suppose also that per capita in¬
come is rising 1.5% per year.. At
for 1950.
RAILROAD
merly relied
tially their retirement pay will be
low .because of early retirement,
_
Specialists in
the type of
was
Ini-r
support.
manufacture, purchase and sell
Douglas fir (softwood) plywood, and ; even this amount will be
hardwood plywood, pine plywood,
an
shrunk by the inflationary ten¬
accurate
distinction between
and
dencies
'serious loss' and 'not too serious doors, and other laminated
so
characteristic of the
related
products.
The
company
loss.'" Mr. Gurley then went on
contemporary welfare and milir
and
subsidiaries own 26 plants
to outline what steps had been
tary state, with its diverse hand¬
strategically located with respect outs
taken or were contemplated to
for every type of organized
to raw materials throughout the
pressure group.
The value of the
% prevent a recurrence of the dam- United
States, in Canada and the
i age. These
pensioner's income will shrink
steps are in line with
Belgian
Congo.
For
the
year
evenif
there
is
no
inflation.
For
'""long established practice when ended
April 30, 1951 the company
similar experiences in other places
suppose you retire with a pension
reported consolidated gross sales
of $200 a month, and suppose you
of $108,450,530 and net
profit of
will not be 'too serious—I appre¬
ciate that it is difficult to make
If
still
their hands the fruits of whatever
pany
attempting to mini¬
difficulties, encountered,
Mr. Gurley in his letter was cer¬
tainly not pessimistic. He wrote:
not
observation
not inclined
am
importance
production, with the result that
point of view
option at a price of $105.25
share up to July 1, 1952 and
persons
relatively and
This
however.
other outlays as there is added to
his
thereafter
While
I
now give the appearance
at times of connivipg to retain in
the
.
for
demand
older
monoply and industrial result that in 1950 the
percentage
But today it happens;
of persons married had reached
be reduced in like measure.
In much less frequently, since com¬
the highest level in history, at
general, if the older workers are petition is
being stifled.
The least for
many decades, 68 out of
kept busy, there will be added trade union
for
and
annuity.
was a double-edged sword, caus¬
facilities and timber. It expects to
ing important revenue losses and continue to expand
its
timber
at
the same time bringing in¬ reserves and
productive capacity.
creased
The stock is callable at com¬
costs, which, to quote,
the
by
both
ture of demand
(1)
national
the
company
whilst
favored
increase
Population Composition
month period ended June 30, 1951,
has spent approxi¬
mately $8,500,000 on" new plants,
July.
tively,
Effects
higher level of employment and
production will be achieved and a
water
younger
will decline, at least rela¬
changes in
road,
in
by
persons
come
11
page
stockholders
difficulties
favored
goods
the
of
The demand
goods and services to changes
in the pattern of demand, whether
these changes have their origin in
level of pressure upon"
A group of investment bankers reduced
outlining
the Federal and the local govern¬
headed by Eastman, Dillon & Co.
the difficulties that had been en¬
mental budgets.
on Aug.
2 publicly offered an is¬
countered in June and July. This
If the worker is thrown out of
sue
of
60,000 shares of United
is a far cry, and' most commend¬
States Plywood Corp. 3%% cumu¬ work earlier, there is a collective
able, from the days, not too far
ual effect and there is a collective
lative preferred stock, series
B
back, when railroad management
effect.
As an individual he must
(par $100) at $102.50 per share
generally considered it imperti¬
and
accrued dividends. The
of¬ accumulate enough money to pro¬
nent if security holders felt them¬
fering was quickly oversubscribed vide him an annuity until he dies:
selves entitled to some explana¬
If he retires five years
and the books closed.
earlier,
tion of what their company was
Proceeds of the sale will be add¬ that is five more years the annu¬
doing. Although pointing out that ed to
must support him and five
company funds for use as ity
it was impossible to estimate the
working capital and other corpor¬ years less time in which to build
possible ultimate costs, Mr. Gurley ate
purposes.
During the
14- up a fund wherewith to purchase
wrote
written
of
leaders
company.
G.
F.
Continued
about
year.
Under
divi¬
already
regular $2
1951,
with the current prospective earn¬
ing
At the present time
it appears almost certain that July
results also compared unfavorably
Gurley,
1,
the
at
likely that a year-end extra will
paid again this year. Certainly
such hopes are not out of line
the road's troubles did not
last
Sept.
been
is
valid, and the effects of changes
compostion upon the struck
course.
the old stock had
declared
be
year ago. The overall showing
was
still quite gratifying.
How¬
with
1.
on
the
a
in June.
The
Aug.
annually)
the $8.50 reported for the first half
end
Of
of
in age
creeping moral deterioration at Washing¬
stop and those guilty of such acts must be
exposed and punished."—Sen. Harry F. Byrd.
split of the
has recently been approved
for goods.
absolutely.
ton must
posi¬
Composition
has
will
peddling
The time has
the
demand
goods
Committee for
under criticism for
of children.
Upon
—Much
for
.
quarterly rate. It is generally ex¬
pected, however, that a more lib¬
eral comparative rate (perhaps $5
dipped fairly sharply. Net for the
ever,
come
another
the Demand for Consumer Goods.
when this
two-for-one
dend
been
income
net
(3)
by the ICC and became effective
extreme
optimism.
During the month of June gross
revenues
financial
does support
member of the Demo¬
his influence.
;
tion.
More recently the company
been having its troubles,
Harry F. Byrd
but also because of its very
strong
.
make
possible, for the diminu¬
tional compensation in America as
Committee,
the committee
and Mr. Boyle
.
Nor will
less, and the support
aged does not offer emo¬
the
of
National
a
is
no
tions will be
cratic National Committee has
one
of
was
support
solution
twelve years and, so far as I know,
no
other chairman of the Demo¬
country,
basis
dren's
rejected,
then
he
Chairman of the
cratic National
Santa Fe is ad¬
year's earnings, incidentally, were
war year.
"I
which
There is
the diminution of the cost of chil¬
as
should be dismissed.
appeal of these in¬
shares.
resign
should be assembled
and inter¬
near
times
should
and, failing to do so,
Fe picture
Santa
three
annuity
an
generous.
other solution than this.
St. Louis firm which had been
a
Democratic
The
strong to be
mediate
the road might well duplicate this
share
too
detract
non-recurring retroactive mail
increase received late in 1950,
year
are
is
seriously or
permanently affected by tempo¬
rary considerations of this nature.
Nor are the recent developments
of sufficient magnitude even to
overall
basic
far
Some people had begun
to think that perhaps even with
excess
Mr.
situation is not "too serious."
earlier.
the
with
accord
more
like
to
were
in full
Gurley that the
generally
Analysts
•
than 25% and
common share earnings amounted
to $8.29
compared with $6.39 a
May increased
changes
necessary.
very
a
that
demonstrated
Fe
Santa
from
relatively
"Either
the
that of house¬
The
must
have
neighborhood
number
of
increased
in
of
700,000 per
year, therefore; in fact the census
bureau puts the increase at about
660,000
per
year.
During
the
1950's, it has been estimated by
Glick, families will be formed at
But
this
would; not
do a rate of only about 400,000 per
good. For suppose the pen¬ year; for there no longer exists a
sions are increased, government backlog of potential but unformed
expenditures are so high already families in the form of unmarried
that
the
income
fraction
of
national
the
persons,
and
the
low
birth
rate
of the
depression years is begin¬
ernment
each
year
cannot
be ning to make itself felt. Presumr
further stepped up as a long-time ably, the number of households
proposition.
This means that if will increase somewhat more rap¬
budgetary outlays are increased idly, for in 1950 there were 2,265,taken
the
by
over
gov-,
they will have to be financed with 000 married couples without their
inflationary money. And this wilt own household. Suppose that half
of
these
form
reduce the value of the pension
households, and
and once again put upon the pen¬ that 400,000 families are formed
sionees and upon other victims of per year; then the number of
inflation the necessity of forcing households will
increase
about
the government to increase their 500,000 per year, or at a rate only
Under these conditions,
support.
given
the
all
producing devices in
could well have
we
inflation.
if
free
a
solution
problem
continuing
And it is very doubtful
enterprise
The
is
the
about
would
•
the
for
same
as
survive
two-thirds
The
as
of
the
number
households
is important as I
previously, because the
indicated
rate
of
increase
housing,
pension
and
various
for
ditioned
by
in
the
house
other
the
demand
furnishings,
items
rate
of
is
problem of the older worker, ami
in the number of households.
as
simple solution.
worker
should
be
kept
The older
at
work
until he is about 70.
Then he will
not
unproductive
have
too
many
-«w.
we
will
have
not
But,
indicated, households
form
next
decade
past,
and
as
as
this
accentuated by
"jmuw v ;y#4
con¬
increase
it is
a
in
»
of
movement
for
the
high
as
1940-50.
our economy,
continuing inflation.
•
inflation-
other
rapidly
in
the
tendency
in
may
the military
the
just
one
be
serv-
Volume 174
Number 5036
.
.
.
The Commercial and Financial Chronicle
(521)
ice requirements in effect." It follows that there will be a relaxation of the pressure of demand
for
housing
and
in the age groups 14-17 and 18-24.
The
educational
country
composition of
region
or
is
of
(4) Income Composition:
The
income composition of localities
is
important because of its signif-
a
signif-
house, furnish- icance with respect to the suit- icance for consumer
oriented in^
ability of these areas for the lo- dustries. The median
family in-
ings.
data
that have been published
up
now.
Between 1940 and 1950,
to
million dwelling units were
added, though a part of the addi- is
tion
come
not
yet
carried
far
as
Even
exclud-
so
the
crease
nation's
units
of
"
no
is
use
l.o
some
linitc
units
whirh
wmcn
even
by
all
,
82%
standards.
dwpllina
of
all
urban
be
^raHp
grade
respect
to
bile;
cold
or
hp
be
from
d
quite
are
month
one
the
units
number of
i:iurl
f
In
nnnnrtnni
opportune
JnT,. .?
«
employed,
ty for needed housing improvement, the demand for new housing should hold up.,
It may be worth noticing that
the continued decline in
mortality
five
every
a
one-seventh
labo? force,
the
ending - April,
....
'?.' Decon}"Js un
finding
or
proximate
&
v.
A
1948,
job—ap-
the
one
had moved to
persons
different home, with one out of
increasing the stability and every 15 changing his
county of
well-being of
the
family
and residence.
Between
April
1949
thereby making it a better finan- and April
1950,
17.3%
moved
cial risk and a more stable
pur- from one house to another, with
chasing unit. In 1948 667,000 mar- 6.2% changing counties.
It apriages were broken by the death pears, therefore, that
something
of husband or
wife; but if 1900 like six out of 100 persons change
mortality
had
prevailed,
half counties
each
year.
Evidently,
again as many would have been therefore, the American
populabroken, or about a million. In tion is very mobile both with rea
371,000 children became
phaned; this number
been
would
spect to change of residence and
with respect to change of occupa-
or-
have
double if the death rates of
had prevailed in the year
1900
1948.
As
the
incidence
tional
status, and this is all to the
good so far as productivity and
death flexibility are concerned.
of
below 55 is reduced the incidence
of orphanhood will be reduced as
From
the
ab0r
It
orphan's
of
I
shall
data
census
have
the
as
we
labor being
to
1950
data
First
Med. Age Median Age
of Husband
of Wife
marriage
Birth
of
Birth
child—
1st
last childL
of
Marriage of
Marr'ge
of
Death
21.6
25.3
22.6
39.9
27.2
1st
child
48.3
45.6
child
52.8
51.1
63.6
of
husband,
last
industry.
is
engaged
60.9
the labor
in
agriculture
in
e-t
o
methods
d of t
1
73.5
This
merce.
JmUrf
wflthnrf
improved
se
labor force for
wife, if last
There 21
is
t(?u^
r^"
icu tura
ag
industry and
would
mean
com¬
some-
family dur- thing like 1.2 million
males; and
ing middle age, 35-54, is 5, chil- Jf
into the
dren and relatives
being included city there would be a considerin
this
figure; this number is able additional
"theseVere^brought ^
gain of by-product
somewhat lower when the
family
head is under 35. When the fam-
women.
Realization
will take
a
ily head
the
size
of
the
fifties
the
the
family drops rapidly
by the time he is 65 and over
husband and wife
in
that
««
result
a
of
?•
redistribution
feet Of this
be
to reduce
I ~reuute
some
of
L
should
the
disad-
some 01 uie aisaa
7^fvepS Under whlch nonwhltes
,
Intelligence Composition:
Wllile J10 detailed study has been
j.[e' a
Pac\®,i years ago
pleated that the differential rate
natural increase was reducing
the average level of intelligence
M?.
United btates. buch ai deir\e was predicted also in Englo years ago, but the
^ce.n*< daia, while not clear, seem
J
e
<^lanSd m the
,
,
.
s°
.p
ca^e
case
lf
J:
ifr!™ irf+oiiilLnno
.
American
in the
Llvtval
JL deDend
inn Lr
tailfment
t£an uppn
*1
^
again living
are
x
environment
scene
erelt
irf
the
It
of
men
not
lprtlirps
of
this
ai>wi
take
place only after the older
agriculturists leave and the
subjects in
*
Tj
three
my
/
jnt
k
American social svstem
tnOVfhf^nts
Thpse
ih7u*^re-
act uPon the American social systern. The effects of population
manifest
themselves
slowly, the only partial exception
eing the volatile behavior of the
\
birt1
Most Population move1?ents. have implications for the
^menca-?i ?c0?0m^'+an?
will be found to be of
sig-
n+lf^cance for those whose business
ft# tT°
Judiciously. I hope
indicated
of
some
^
1 ™ unp^is.
displaced
younger
ones
have
[EDITOR'S NOTE:
Foregoing
into nonrural occupations, is last
of three lectures by Propprtunity, therefore, for the fam- There is also a second
matter to fessor Spengler on the subject of
ily head to accumulate some savconsider, the prospective rate of "Population Trends and Investings in the last 15 or so years of growth of the labor
supply. An ment."
The previous ones ap¬
his productive life; and this
op- index of this is furnished
by the peared in the "Chronicle" of July
portunity extends back earlier in number of
persons aged say 15-19
19 and July 26.]
alone in half the cases.There is
op-
proportion
the
other
as
members
family besides the head
tribute to
(2)
of
con-
the family income.
moved
as
compared
aged 20-64.
as
,
the
number
In the United
whole
a
with
this
ratio
is
With Waddell & Reed
0.156
(Special to The Financial Chronicle)
Educational
Composition: while in the South it is 0.19; these
PALM BEACH, Fla. —George
School enrollment still falls short figures
suggest,
therefore, that Vt9et1ae.
.
w^o1i <>r
of the optimum level. The enroll- new workers are
fed
into
the Eggleston is with Waddell & Reed,
ment figures for 1940 and 1950 labor force 190/156 as fast in the inc*
South
are:
Percent
of
Persons
F.nrolled
Total
Age Group
s
81.4
14-17.,
^
data
m.
indicate
each
school
is
South
whole,
that
68.2
.
13.3
the
of
the
.
9.1
regional
proportion
group
enrolled
in
somewhat lower in the.
in
the
especially
nation
the
as
or
a
at
a
country as a
rate 22% higher.
therefore,
appears,
With King Merritt
the
labor supply is
to be found in the South.
Against
this conclusion must be set the
so
fbe
south
is
not
quite
well equipped with professional
(Special to The Financial Chronicle)
JEFFERSON
„
,
.
-s
(Special
this
as
type
of
required.
per-
LOS
F.
the
become
actual
The
extent
to
been small, and that the
proposed
been decided
upon for the sake
tlian
rather
economic
•
con¬
•
principle and details of
the
has been subject to much criticism
of
re¬
diffi¬
has
psychological
measure
the part
on
Conservatives and of business interests.
Be¬
yond doubt much of this criticism is well
founded.
Since the limit to dividends
during
the next three years is based on
dividends de¬
clared
during the last two
years
Dr. Paul Einzig
the arrange¬
advantage of firms which, disregarding the
Government's frequently repeated
appeals, have raised their divi¬
dends during the last two years. It will
penalize those firms which
loyally observed the unofficial ban on dividends. From a
practical
point of view the bill will make it more difficult for firms to
raise
new
capital through the issue of equities,
their dependence on bank credits.
crease
A very
strong
dend limitation.
case can
and this will in¬
undoubtedly be made against the divi¬
Yet it must be
accepted as a necessary evil. In
was inevitable for the Government
to adopt some kind of measure
against profits. Otherwise the evi-r
dence of growing profits and dividends
would have given rise to
numerous
substantial wages claims.
the
prevailing circumstances it
Moreover, the Government
under strong political
pressure by Left-wing Socialists,
position of its Left-wing critics would have strengthened
considerably in the absence of some measures against profits.
has been
The alternatives to dividend
limitations
of the tax
on
are
a
further increase
distributed
profits, a restoration of the war-time Ex¬
cess Profits Tax,
the adoption of a tax on capital gains or the
adoption of a Capital Levy. Critics of the dividend
limitations,
when cornered, admit that the choice of
any of these alternatives
would have been much
The tax
to 50%.
on
unfavorable.
more
distributed
profits was raised in this year's Budget
Any further increase .would have discouraged
enterprise
more
than
the
limitation
of
dividends.
The
same
is
true
to be fixed at its war-time level of
80% with the remain¬
ing 20% blocked. The tax on capital gains is
actually included in
the program of the Labor
Party, but it may take some time before
a practical scheme could
be worked out. As for the
capital levy,
in the prevailing
scarcity of financial resources it would paralyze
business.
were
Moreover, there is much
to The Financial Chronicle)
ANGELES, Calif.—George
Gerard is with First California
Company, 647 South Spring Street.
to
be said
in favor of the device of
result of the rise in prices
many
dividend limitations.
Since
firms find
liquid financial
that their
increased
cover
relieved
as
a
requirements, to
resources
some
if
are inadequate to
extent the situation will be
they are compelled to retain in the form of reserves
increase of profits.
In the absence of
statutory limitation of
dividends the boards of directors would be
under pressure
by
shareholders to distribute higher
dividends in view of the rise in
profits and the higher cost of living which affects
investors as well
as workers.
In many instances the
limitation of dividends will
doubtless be welcomed by boards and
managements who realize
the need for ploughing back into the
business the additional profit
but who would have found it difficult to
obtain their shareholders'
approval for doing this.
any
It will take
be
ascertained.
some
It
time before the success of the
measure
depends
can
the
extent to which it
helps the
Government and employers in the task of
resisting wages claims.
Possibly the response of the workers will be in
on
accordance with
the Government's
however.
anticipations.
Conceivably, the
This cannot be taken for
granted,
evidence of growing reserves
might
produce the opposite effect, in that it
might induce the workers
to press for higher
wages.
Should this be the case the measure
would result in
same
an accentuation of the
inflationary pressure. For
amount in the hands of the
workers would produce much
stronger inflationary effects than in the hands of
investors, because
the former are more
likely to spend the additional
money
necessities than the latter.
In any event the measure must
be accepted as
Even if it had
no
a
political
on
neces¬
economic justification the
Government had
to decide to adopt it as a means of
counteracting Left-wing
prop¬
aganda.
The rise in the cost of living has
naturally strengthened
the hands of the Government's
Left-wing critics, and even com¬
paratively moderate Trade Unionists had
that
some
easi^y remedied through
of
Mo.—Rus-
First California Adds
.
importation
CITY,
sell a Trimbie is with King Merritt & Co ? InCj of New York>
and skinecj Personnel. but this de-
proportion sonnet when and
that
has
siderations.
sity.
the
greatest potential
fac£ ^ba^
age
than
■
1950
79
79.3
,
18.6
Examination
It
34.1
84.4
18-24--,--
whole,
School
Nonwhite
1940
1950
i
5-13
;
in
7 Total
in
as
that
has
higher dividends have contributed
inflationary expansion of purchasing
measure
the
States
demands
admitted
increases, and
atmosphere in which
an
wages
the
power
The population movements
themseives reflfect the working of
movements
He
the
of
it
are
these.
gain
number of years, since
consolidation
of
farms
can
f
cult.
which
to
to
concerning the restoration of the Excess Profits Tax,
especially if
attempt any sumj have covered a
for
uPj
sistance
much
natural ability.
shall
been many substantial dividend
that this created
and the
a
more
"J
Conclusion
mjng
Mr. Gait-
ment works out to the
„.
.
equities during the three years' period of
rearmament.
skell sought to
justify this measure on the
ground that during recent months there have
the
migration
The lnncr-rnn efj. "I -u
i
pO^ulattoh
nf
of
The typical size of
and
fast
3
diverse lot
e
into
about
lectures'
mdmpopulation
pomts to keep
in
mind The
about
force
69.7
gets
nonulation
grew
unemployment in agriculture and
available for
out of each 100 males
if
—
Death of
a«?
*s m the South. First, the South
has a large amount of concealed
"""" ~
husband
(wifet
Death
24.3
last
of
as
one of the most lm-
mdustiial location. This place
are
yet at hand:
Stage of Family
Cycle:
South
?ort?n} °/.^e elements govern-
1940
use
-
not
South
oi times as last as; that in the
nf
interest also, while
the subject of families, to
indicate the course of the family
on
cycle.
standpoint of invest-
in
£on?ynite population
the
timee?
the^American
£ where the greatest po\Z^ ivai^hi^vPP ^high
} ,e availability of satisfactoiy
f0rce*
is
are
States;
anything else'
perhaps the most significant
her moral character
aspect of the present occupational
and Sciencf c^? t a i nl v and
orphanhood composition of
pop- mQral character probably nourish
enuring the nation
ment
will the length of the interval between the advent of
and
nonwhitp
A?
be^
is
distributed
aisiriDutea
r,m
the
in
from the South
of
out
thp
-P
year
is
1948
1940.50
I
outside
and
more
or
in
.
population
evenly
more
throughout the United
cnanging ineir
is, leaving or entering the labor force becoming un-
racial
signifi¬
differences
J? more evemy
changing their
persons
status—that
coming
mo-
the
ni "u
u
of
of
LONDON, England.—On July 26 the Chancellor of the Exche-*
quer announced in the House of Commons
the Government's deci¬
sion to introduce a Bill
preventing the increase of dividends on
»
The
remains
nonwfite
the
to
since
to
water.
running
new
and next, it has been estimated,
and
dwelling
short
as
thprp will
will
snort,
as
there
for
workers
The
Lrammsi
.nese
aiIiereut:es
are
training.
These
differences
are
Jr •"£*• t u
cunqrences are
diminishing, however. Moreover,
ueiei
a
.
important with
location.
because
cance
deter-
,
exaggerated
L,i
a
havp nrivatp tnilPt and hath
nave
with
pnvate toilet and bath, with
hot
somewhat
American
Only
unites
aweuing units
„
,
locate
piant> but its importance tends
dwelling
Inw
low
vprv
very
present
74nf
noi
million.
arp
are
*
to
-.
_
.
composition
.
where
seBrvice
and
on
holds there is much in favor of
dividend limitation.
of
f?*®1®1}..I1.6.
longer
decade 800,009 ad- mand for capital,
dwelling' units per year
(3) Occupational Composition:
are
added
whilst households are
Occupational
composition
is
of
formed at a ra.e of only about
significance when one
•
b|
determining the
retail
.
lation is
the present
mming
j„
of
Britain's Chancellor of the Exchequer's
pro¬
posal to prohibit increase of dividends on
equities for three
years, Dr. Einzig says such move would
give advantage to
those companies
which, despite government appeals, increased
their dividends in last two
years.
Foresees in proposition
greater difficulty in raising new
capital by stock issues, but
among
nthprc
Foreign and Racial:
,
ditional
'inn nnn ner vear
thprp chnniri Hp
500,000
per year, there
should develop pressure to remove out of
same'sort,
with
iocati0ns
being offered for rent or like to add that education stimuAccordingly, if in the course lates invention and hence the de-
sale.
alrw
suitability
only
the
ing
wider range is found
states
These data
Prrmiovpd
dilapidated dwell- This question calls for much more
735,000, or 1.6% careful and detailed analysis than
reported 45,875,000 dwell- is possible on the basis of the
units, were vacant dwelling available census data.
I
should
units,
Central
the
productivity. the
ing seasonal and
ing
No.
A
by increasing the economically justifiable in view
dwelling units in exist- of the capacity of education to in-
ing structures
East
South
made
was
number of
No.
Commenting
$3,068
3,435
3,362
3,257
2,248
West
is
as
By PAITL EINZIG
by region follows:.
U. S.
Other studies suggest, however,
that invea ment in advanced education, or its equivalent, probably
8.5
of
LimitatioasonDiTidendsinBiitaia
:
Precisely how the demand for cation of certain kinds of indushousing ' will be affected is not try. The available data are not
yet
evident
from
the
housing very
revealing
on
this
score,
21
they would join those critics unless
measures
against profits.
warned the Government
the Government
adopted
At the trial of strength between
moderates and extremists during the annual
Party Conference in
October the latter would undoubtedly gain the upper hand in the
absence of dividend limitation
profits
or
capital.
or
some
form of additional tax on
This is the basic fact of the situation.
t'. J».l^ JtuXiUlil'* ImL*-,
22
r
'AWW^C^V...
~4t<U**XU*a«»„M»L*W IUSlw^my»(!»r,^rfrrU--nVaVJ"/V I i*» (»'MtuiH<J
The Commercial and Financial Chronicle
(522)
Continued
from first
securities
page
what
of
a
Both
the
of
confined
to
for
Europe
Upon
were
over
a
two-year period, during which we
built up our armament potential
actual
entry
into
I, the stock market
our
World
War
started
its downward
continued
until the ul¬
and
decline
to
considerable range.
The
extreme
ranges
in the 1935-39
period were nearly 100 points,
very
ture
existing
stock
market
by the level
prices Jaken
in rela¬
expected course of fu¬
earning power.
This is a
that
Wars
World
extremes
the
the
relatively stilted
War
Hostilities
Prior
their
as
tion to the
of
course
will be determined
France and made very little recovery from then on.
1935-39 and
.measured by
they moved over
years
1946-49,
both the inflationary
worries and general optimism in
the spring of 1937 and the shock
at the deflationary pressures of
the
Economy
for the
since
erages
a
The Lesson
of
riods (Chart I).
his¬
American
in
From the record it is clear that
Rearmament
phases of both war pe-
start
greatest
tory.
ing Under
different
at
the
been
boofn
business
the
overboard
has
way of saying
deflated stock market will
a
be
prove to
resistant to poor
very
that would find
business
news
inflated
stock
market
an
vul¬
very
reflecting
which
recession
the
in
business
The
World
of
start
caused
that
panic
a
War
the
of
summer
until
felt
the
closed
stock markets of the world
It
1914.
I
during
was
not
January of 1915 that it was
safe to reopen the N.Y.S.E.
Then to the surprise of many, the
market
stock
started
advance
mendous
upon
that
tre¬
a
lasted
for
nearly two years, interrupted only
by
reaction
the
caused
sinking of the Lusitania in May,
1915.
During
this period
the
by the
the
Averages,
reopening
from
rose
of
level
54.72
to
110.15.
war
in
wave
accelerated
more
in
curred
the
declaration
actual
than
one
War
World
in
umphs
the
balance
of
stock
quietly throughout
war period.
the
of the
have
been entirely different from the
investor's point of view.
In both
the
cases
prices of
into
followed
the
stock
hostilities
of
inflationary
an
violent
end
sort
every
stock
by
carried
This
sharp
in
was
break
in
prices in the fall of 1919 that
ushered
in
the morning
1920-21
and
hostilities, to a high of 155.92 dur¬
ing the course of the same month.
After hovering below the initial
high for about seven months the
market collapsed with the fall of
sion
the
the
banking crisis of
postwar depres¬
which it entailed.
stock
boom
that
market.
a
market
broke
When
in
the
Septem¬
ber, 1946, many investors felt that
investment history was going to
be
of
repeated and they threw their
CHART I
business
good
conclusions
dicate
that
vestor
must
the
be
place
in¬
the
not
or
have
to
day
present
mind
as
prices
of
learned
at
market
the
time
some
level
130
and
is that in¬
wars
consider
be
to
war
tem¬
in nature, and, therefore,
relatively low value upon
a
the profits won on
mament basis.
strictly
a
ar¬
sold
Before U. S.
After U.S.
Entry
Entry
AVERAGE-HIGH a LOW
J
1013
7
Vl
I
r
JL
inflation, three factors
peculiar to the present
)
f+fj
j
H
i
:
v
«
M.
'.
>
1917
the
of
WORLD WAR JL
Before US Entry
After U. S. Entry
180
160
*
■
|*t Mlj
140
/Hv%
120
100
NOTE' VERTICAL SCALE CONDENSED
TO SHOW PROPORTIONAL CHANCE
1
CHART II
the
other
wars,
past
1
80
two
wars.
market
period the stock
emerging from the
was
of the great depression
banking crisis. Govern¬
ravages
the
and
postwar period.
influences
ment
re¬
below:
that
Product
Except for
a
few
partment
by the dangers of defla¬
tion,
it is of interest to note
were
about 66%
were
carried
This
price
above the
properties
their
which
their
cn
Gross
the
and
in¬
in In¬
the
rise
place in the value
listed
stocks
the
on
The value of the Gross National
left
investors
taken
the
with
Production
if
1937
comparing
has occurred
has taken
lower
that at 140 the Dow-Jones Aver¬
at
dustrial
of
current
have
of
value
Product
which
crease
at
by
which
the
of the
worried
sold
in
place
National
problem
stocks
inflated
are
advances
S. E.
in
value
the
Y.
months
so
levels
all
work
Approach
the
not
or
of
themselves.
to
angle
whether
N.
were
;
Industrial
to
would
feared
directed
■
the commodity price
which most investors
dollar
prepared
as
the
by
Commerce
of
value
the
upon
De¬
places
a
industrial
production, the agricultural pro¬
duction, the services rendered by
the utilities, rails, banks, etc., the
medical and personal
dered
the
and
services
rents
ren¬
received
on
books.
own
was
of years.
the
In
value of the Gross National Prod¬
postwar period of 1946-
to measure the ele¬
inflation in the stock
of
it
is
not
the
of
the
book
market
compared
to
price
over
is
values
66%
only 32% as
in the prewar
is
uct
sufficient
and ready, but
method of presenting
the
inflation
the
general
The
which
price
value
the N.
on
of
has
entered
structure
Y. S.
and
stocks
over
listed
E., like the Index
Production, has just
doubled
period
the
of
Industrial
the
since
stands
now
1935-39
just
over
$100 billion.
On
Averages 'at 180 sold for
only 9.1; times their average earn¬
ing power between
1946-49, a
ratio that is only 55% of the 16.3
rough
a
graphic
the past 12 years.
period.
Jones
the Market
and
mium
In the postwar years, the Dow-
trying
ments
1918
earning
in¬
This
ferent
about
FOR COMPARISON OF CURVES.
1916
as
or
their
Chart II approaches from a dif¬
barriers.
Thus,
the
forces
of
Democracy must plan to cope with
a great deal more
sabotage in the
future than they experienced in
market
1915
In
Inflation
NOTE: HORIZONTAL SCALE EXPANDED FOR
fast
built up
as
have
that
dividends have
relationship is
and
The
150
a
In
vs:
risen
not
values
extent
•
possible direct attack by the 49, at 180 the Dow-Jones Aver¬
enemy was limited to the scale of ages sold about 30% above their
book values of $139, which had
a nuisance raid; and
(3) We and our Allies are faced been built up by reinvestment, and
with very dangerous Fifth Col¬ at
the
present 250
Dow-Jones
umn movements, since the present
level, when everyone has been so
concerned over inflation, the pre¬
ideological
conflict
knows
no
either
/
book
the
,.
V
/
70
I
.
^
have
stocks
the
above
below the
any
WORLD WAR I
a technical an¬
it would seem very clear
that the prices of the Dow-Jones
Therefore, from
income-producing real estate. The
about 16.3 times average value of the Gross Na¬
the
that are
average
earnings of $8.60 tional Product was placed at about
which those 30 leading industrial
situation
should ibe
considered:
$84 billion during the 1935-39
companies were able to report for period and presently stands at
(1)
The
present
cold
war
the five years under review. The
$314 billion, a rise that is nearly
against Communism has already
average of $6.30 which they paid
four-fold.
prevailed for six years and there
out in dividends provided a 4.5 %
The industrial production data
is no prospect of it subsiding as
dividend yield, which exceeded is the
Federal Reserve Board's ex¬
far ahead as we are able to gauge
the
31/8%
yields
available
on
cellent Index of Industrial Pro¬
the future;
>
Triple A bonds during this period duction. The index has
approxi¬
(2) For the first time in our
by about the normal spread which mately doubled so that the dis¬
history, the United States is vul¬
had prevailed over a long period
nerable to direct attack by enemy
persion between the index and the
of view of
disastrous.
DOW-JONES INDUSTRIAL STOCKS
i3
it will get in
as
alysis,
powers
1935-39
the
ages
Before considering the level of
the stock market from the point
inter¬
bonds
the foreseeable future.
an average
the
for
one
structures
ex¬
weapons on a scale that could be
STOCK MARKET RECORD
ate
that-
so
A second les¬
the
small
as
the
on
the
A
'
bolstering
from
probably
yield
and
Triple
viewed in the table
during
inflated
been
the postwar boom*
son
in¬
make up his
whether
to
stocks
clearly
stocks
on
months
news.
These
rates
creased.
inflated level,
an
est
of
1938.
dividend
Dow-Jones
However,
In
porary
the postwar periods
buying
from a low of 121.44,
after the outbreak of
impetus
vestors
Even
Conversely,
perience of both
Postwar
a
the Dow-Jones
the
oc¬
How¬
I.
Pacific,
the
advanced
a
Averages
was
market reversed its direction, and
turned into
that carried
Harbor
with the victory at Midway,
which checked the Japanese tri¬
September, 1939,
wave
four
ever,
started
With
selling
a
the
the
by
stock market, as measured
Dow-Jones
after* Pearl
months
in
decline
market's
the
nerable.
the
tween
engulfed
spring
during 48 of the 60
in this period the stock
Thursday, August 9, 1951
.
to
price of
by supplying our future Allies timate victory was clearly in sight market needs excellent business 140 is a very descriptive one for
late in the summer of 1918.
Our
with
material
and
made
some
news to maintain itself, whereas the purpose of investment analy¬
headway toward building up our entry into World War II was a far a deflated market can be expected sis. A similar review makes an
greater shock to investors, so that to advance in due course under average price of 180 an appropri¬
own
armed forces.
course
.
.
that
this
the
basis
it
since
its advance
with
the
added
would
is
market
is
appear
inflated
not
in
about
physical
line
volume
thatj has come into being rather
than in line with the inflated dol¬
to
lar
volume
As
characteristic
of
the
value of the
ratio of the prewar period.
Be¬
Gross National Product data.
merely consider the fact that at cause of the panic caused
by the
250-plus the
stock
market,
as outbreak
However, in pursuing the rea¬
of war in
Korea, the
measured by the Dow-Jones Av¬
1950 level of 220 failed to reflect soning developed from these fun¬
erages, has risen about 70 points the
damental relationships, it should
jump which carried the earn¬
in the past two years and that
ings to a $30.70 level so that the be borne in mind that the volume
the rise; compared to the prewar
of our industrial production itself
price-times-earnings ratio fell to
period, is about 110 points. If the only 7.1 times. The
subsequent may very well be inflated as com¬
fact that it has risen were alone
improvement in the market has pared to normal years in the fu¬
the answer, an investor would ob¬
only carried the market's evalua¬ ture. The postwar years were in¬
viously be disturbed by the fact tion of the estimated
earnings itially benefited by the "pentup
that on a historic basis the Dowthat
built
for 1951 back to the postwar re¬ demands"
up
during
Jones Averages are at a level only
the war and by 1950 may have
lationship.
'
\
/ '
• * 1
reached in the later months of the
been borrowing
against the de¬
Because it is expected that the
wild speculation that culminated
mands of the future—a
circum¬
pressure of Excess Profits Taxes
in the panic of 1929.
stance
familiar
to
every
boom.
cut down the year-end divi¬
may
However, this is not the proper
method of approach, since the ad¬
vances in the price of stocks that
have
been
in
scored
the postwar
period must be measured against
the
increased
properties,
values
their
of
their
larger
earning
powers and the greater dividend
payments they are now able to
make.
If the advance in the price
of stocks has been commensurate
with these other
market itself
be inflated.
cult
to
when
the
scored
ahead
ing
in
in
stock
the
advances
late
and
dividend
table
measure
were
so
pay¬
below
the
is
designed
lationships
that
periods.
prewar
To
do
were
and
this
re¬
established
the
it
postwar
has
been
necessary to arrive at a proper av¬
erage
the
divi¬
1951
a
combination
of
new
of
(1)
inflation
acts
factors
trols
have
combined
to
raise
value of the Dow-Jones Av¬
of
ance
and
(2)
con¬
tempo¬
in
the opinion of such
major bond buyers as the insur¬
ance
companies. The spread be¬
Dow-Jones
Book
Value
industrial
_____
Price-Earnings Ratio
Dividend Payments
Dividend Yield
—______
Triple A Bond Yields
Brit¬
the
Marshall
Plan.
plants
were
mately
summer
on
that
$50
of
plant
totaled
billion.
1949
rose
the
approxi¬
Starting
the
expenditures
again,
but
these
Summer
Year
Average
Average
1951
J 950
1940-49
1935-39
250
220
180
140
189
182
139
85
$27.00
$30.70
$19.76
$8.*30
9.3
7.1
9.1
16.3
$14.00
$16.13
$10.25
$6.30
7.3%
2%%;
5.7%
4.5%
2%%
3 Vs %
-
Stocks
—_
Earning Power
the
primarily
rather
expanded between 1946-48
through
expenditures
for
new
facilities
a
was
rehabilitated
the
rate is considered to
be
like
Our industrial
than
one
business
generosity
yield of Triple A bonds to about
3V8 % — their prewar level — this
rary
export
ish Loan in 1946, our relief assist¬
authorization
by monetary
Our
tremendously stimulated, first by
the rest of the world spending
the dollar balances they built up
during the war, and then by our
facilities and the desire to
curb
inflation
note:
the 4.5% yield that was available
in the prewar period.
While
the
postwar industrial production we
as
compared to the $16.13 total
paid in 1950. On this basis they
would
provide a 5.6%
yield,
equivalent to the yield paid in the
postwar period and well above
stemming from the
of
which may prove to be part of the
to
present level of the
Averages with the
the
payments,;
dends have been estimated at $14
reality.
Dow-Jones
in
far
earn¬
to have carried them out
of the range of investment
The
1920's
which
prices ran
of the gains in their
as
to
prices
stock
powers
ments
not be taken
that
prove
inflated
were
factors, the stock
can
It is not at all diffi¬
dend
5.6%
3Vs%
,
Volume 174
Number 5036
.
.
.
The Commercial and Financial Chronicle
(523)
later
expenditures represent pri¬
marily expansion rather than re¬
They have totaled
habilitation.
over
and
billion
riods
will
in
of
1951.
such
pansions
have
when
facilities failed to
new
depreciation
companies.
This
-
economists
concern
accrued
match
by
causes
many
investors
and
the
is
hump.
economist, who is
this audience,
Sumner Slichter, feels technologi¬
cal developments are coming so
One
eminent
well
known
pected
to
cause
expenditures
can
the
be
ex¬
with¬
or
of
continued
be
that
our
have
to
support
'
services
over
us
arma¬
heavily
upon
sources
that
may
sumption of
flationary
an
over
the
next
For
Between
the
summers
eral
of
after
years
which
was
to
pro¬
1945 and 1951, the number of cars
hoped
on
vide both "guns and butter" with
ease.
'■ .'v>::
VvL'
our
highways increased
from
under 30 million to about 45 mil¬
lion and many a disturbed driver
is pretty well convinced that we
presently
have
highways.
»
more
penditures
so
The recent accident
of the casualty com¬
experience
correct
it
fall
from
million
to
a
1950
level
much
of
smaller
great
.
to
Korea
the
re¬
on
■
June 30
our
have
risen
to
a
expenditures
$25 billion level.
appliances at a degree never
dreamed of before the war.
This
has reduced the housing pressures
except for the West Coast, Texas'
certain defense
Therefore,
to
conclude
of
stocks
flated
rent
it
that
compared
as
of
the
is
to
business,
level
not
the
the
in¬
inflated
and
that
a
contraction
armament
The
off
Scope of Our Rearmament
Ever since Korea, investors have
been barraged by figures upon the
cost
of our
that
have
rearmament
program
been
nothing short of
Therefore, it is nec¬
orient ourselves as to
astronomical.
essary
to
the Administration's goals and to
consider whether
apt to be
or
not
carriecj out
as
they
are
planned.
combination
of
Korea
and
touched
terrific buying spree which
indulged in by every one from
the housewife to the business
crease
which
has
taken
place
in
rearmament outlays over the
year
has not
in
itself
been
sufficient to offset the slowing
up
in general business caused, in
part,
by
out¬
understood
the
distinction
out
other
of
the
Supply
is
.In
general
into
three
the
way
program
that
elements
ment
of
for
make
.
to
portrayed upon the accompanying
diagram Chart III:;,
up
unit
must
have
to
be
manner:
consider
t h
e
the
Armed
table
a
table
official,
of
the
their
of
or¬
equip¬
method
needs
has
■
-•
•
■
-
Initial needs of Troops
activated June 1
Initial needs of
Troops to be activated"
course
how it will affect the outlook for
International Air needs
the
Miscellaneous needs
Air
leading
companies
in
the
industries.
Regardless of
Force
I
of
.
.
needs
.
.......
.
"
whether
his
him
political
an
isolationist,
lands
or
him
investor
to
consider
which
course
last
winter,
,
during
the
black days of the Korean retreat,
it was taken for granted that our
rearmament
efforts
would
be
With stability reestab¬
Air
started
the
to
as
of
.
.
.
.
.
.
extent
of
our
ground
troops to
the Atlantic Pact Army we are
helping to organize in Europe. By
this debate American opinion was
computations made by the
Forces,
the
Navy
International Aid
.
.
turing facilities which
for
and
are high in
they require.
nages of metal which
also divided
between the initial needs of their
These direct expenditures for fa¬
cilities by
the Defense
troops and the replacement needs
ment
will
in
about
one-fourth
order
5 If
we
to
up
as our
them
Depart¬
supplied
apparently
penditures that
bear the
other
total
well
to
are
equipping
may
as
are
keep
equipment.
.with
lished in Korea, a great debate was
commitment
.
Required Production
The
the
country may be expected to adopt.
of
Requirements
on hand
some¬
it
is his sole function
Supplies
an
an
probable
Total
conscience
interventionist,
where in between—as
As
in
a
materiel.
war
—Requirements
Navy needs
the
various items
our
and
serve
Supply Program in the following
likely to happen and to consider
makes
Army
been worked out under the
Army
are
Replacement for Troops in the- Z
Replacement for Troops in the T. O.
major
II
document
military develop
the
determining
divided
War
This
every
Forces
end.
which
the
initial
declassified and will
Since
rearma¬
be
may
World
their needs
Nature of Rearmament
a
ment
between
Program.
now
ganization
The
of
and
facilities is pretty
by investors, but
to show how the
majority after its fate had weighed
on
well
adopted by this country to be ei¬
ther statesmanship of
politics; it
is his job to • anticipate what is
that the postwar boom, was head¬
commitments
ing towards
However,
a
conclusion.
Since the $12% billion increase
in
rearmament
expenditures only
amounts to about 4%
billion
value
placed
of the $314
on
the
com¬
that
on
Continent.
who
anyone
followed
the letters to the editors all
over
the country could not help being
struck by the overwhelming ma¬
jority which backed Mr. Hoover's
pleas that our efforts be limited
to
the
as
Russia
convincing
in the balance for months
start;
needs
equipment and replacement equip¬
ment is not
nearly so well com¬
prehended. To develop this
point
the following table has been taken
slovakia led Congress to
adopt the
Marshall Plan
by a
the
in Korea sparked
war
inves¬
some
initial
will
obviously
the
equipment;
The need for
internal
with
at
(3) The replacement of the in¬
equipment after it has been
issued.
would, of course, restore the
rearmament budget in full force
just as the occupation of Czecho¬
It is not the problem of the in¬
vestor
Hemispheric
Defense.
In
any
the debate ended in a final
in April that only four di¬
case,
COSTS
area
rests
aggression in
important
is
itial
However, the ulti¬
decision
materiel
this
—
facilities
new
war
brunt
.armies,
facilities
new
of
of
ance
which
will
this
which
amount to
the total ex¬
of
be
made
the
year,
will
be
for
bal¬
made
by
private business.
to 5,000,000 troops,
own military estab¬
Expenditures for original equip¬
lishment of 3,500,000 men, we will
be
engaged in supplying them
ment
needs
for
our
world-wide
rearmament program have also to¬
dislocations, but, ^hown to be divided between a with initial equipment until well taled about $6 billion, which is at
to ^ far greater extent, due to last desire not to
lose Europe to Com¬ towards the end of 1953., Once we a rate of about $500 million a
fall's over-buying and
the fact munism and to avoid any further have equipped our own
troops, month. These are the items that
100
REARMAMENT
re¬
rearma¬
they
anything
an
fabricated
(2) The
troops for
ob¬
if
our
be
the
23
rearmament
CHART III
100
just
program
maximum.
However, the $12% billion in¬
and any
cur¬
in
drift of
which
its inauguration.
ex¬
ecutive.
past
The
conver¬
a
our
program.
a
the rearmament program
was
would be expected if it were not
for the implications of our re¬
have reached
sational total of about $90 billion
which may or
may not be realistic.
cur¬
post¬
volume of business has been
war
next year
fair
seem
while
themselves
level
1
areas.
would
expenditure of $60 billion and
the informal discussions for the
an
revolt against the
a
ment
was run¬
_
included
were
break of the
in
ning at a level of $12% billion.
During the past fiscal year which
6.7
mate
we
necessary
being
wonder
developments,
longer period.
possibilities of the
program
such
might very well conclude that
the scope of the rearmament
will
be cut back or spread over a
much
budget for hostilities in Ko- 1
in Korea may very well
spark
be
(4) We have built about 6 mil¬ The
budget presented for this fis¬
lion new homes and filled them
cal year to June
30, 1952 calls for
with
and
1952
budget of
Defense Department
our
is
to
to
casual
a
appropriate
the
re¬
rea, peace
ca¬
was
it
Bill
even
tor
compelling in7
very
reason
provisions
general Vbusiness
program
From
na¬
a
led
to
political
Although Assistant Secre¬
tary Lovett has testified that no
ex¬
apparently
our
that
in
most
like the totals called for
under the
present budget.
tailed.
r
Prior
ended
placement total.
that
of
productive
next spring
by
a
rearmament
force.
appears
their
^
would
pacity while the
obvious,
before too long the production of
new passenger cars
will have to
as
able
would have to operate at full
panies bears out this view. If it is
as
be
To do this our rearmament
than
cars
would
we
Gross
our
to consider the
sev¬
it
intend
one-
the
is
server
pressure.
this
•
(3)
of
well experience
very
as
economy
value
one-quarter
ment over the years
our
equal to about
the
of
writing, Con¬
Controls
extent
an
(1) The need for
cutting down the Admin¬
istration's
an
tional production.
Any such ex¬
pansion will, of course, draw so
as
be increased
tremendous
a
to
of
point which would allow
gress is
fense Department's take will rise
was
materials
De¬
Product and in the $90
billion total contemplated for the
fiscal year to June, 1953, the De¬
years
output
own
fundamental
would
for
Therefore, it
As of the present
National
ahead as well
ever-increasing level in our
living standards. These goals were
supposed to place a strain upon
tremendous
well into the future with
out rearmament.
to
a
to
attitude
that preparedness would
and
such
to
the
preparedness was the
only
assurance
against
world's
steel
plant to continue
on
complete
decided
to
fast that obsolescence
fifth
that
mately prove to have been drunks
instead of Communists.
If,
budget of $60 billion
actuality over the next
months, it will consume goods
12
the
up
yet compelling.
partment's
becomes
and
felt
was
into the future.
the
over
designed to build
not
are
however, the current Defense
It
have
to the period after our
as
rearmament
fects
mere
military strength of the free world.
war
some
bined goods and services produced
by the country, its inflationary ef¬
recog¬
program
periods
the
was
pe¬
for
the
it
ex¬
$24
followed by
expenditures
been
Korea
past,
the
In
feverish
in
pjant
about
to
run
gression
nized that the
weight of the
world moral opinion would not
serve
to stop the aggression of
Communism, so we launched a
$18 billion in both 1949 and
1950
With the outbreak of armed ag¬
vote
visions
should
be
sent
and
a
re¬
that
quest
no
additional troops
without Congressional
approval. Such a vote would have
should
go
been unthinkable in
1950
the
and
much
hower's
task
of
ropeans,
who
are
to
December of
whole
vitiate
to
that
debate
General
did
Eisen¬
rallying the Eu¬
realistic enough
without
unstinted
help from America they
can never
know
stop the Russians.
Then
has
the
since
MacArthur
added
their confusion
tion will
eign
do
and
in the matter of for¬
Europe's
effort
Atlantic
Pact
On
episode
our
to what the na¬
policy—with
creasingly
both
to
as
the
in
is
result
behalf
said
to
that
of
the
be
in¬
disappointing.
their
part, our Allies have
cooperation more difficult
made
by:
other
consume
(1)
The
failure
of
the
Dutch
to put any effort into the
maneuver
organized
for
General
Eisenhower;
(2)
The failure
Italian
of
the
French
electorates to register
further swing away from Com¬
munism in their respective spring
a
elections
from
stored
the
although the aid received
Marshall
both
Plan
countries
to
has
re¬
relative
the metals.
•
J.
The
Defense
also
Department's
wish to include, then our defense budget for the fiscal
year to June
production requirements will be 30, 1952, contemplates expendi¬
dictated by the i r replacement tures that will total about $60 bil¬
needs. If we are not engaged in lion. Even if the expenditures for
actual combat, the experience of facilities should double to a $12
the last war shows that the re¬ billion total, the funds to be
spent
placement factors for items out¬ on the initial equipment needs
side
that
troops
of
the
we
may
Quartermasters
Sub¬ of the troops will rise six-fold
from the $6 billion
spent in the
sistence and Equipage groups were
very
1951
fiscal
total
in
itMo,
it
low for the troops that were
year
to
a
$36
billion
the fiscal year 1952.
2%%-aEven without
month replacement factor would
getting involved
in
the
have been high for the troops in
telephone book totals un«
de'r
discussion
for
the fiscal
the zone of the interior. In con¬
in
training—as
guess a
a
year
trast,
the
factor
replacement
needed
ahead
is
with
clear
our
that
11
we
go
world-wide
re¬
by the troops in the active
theaters of operations was very armament plans we are going to
find that
our
deliveries to
the
high, averaging, say, 10%. Thus,
when the original equipment pro¬ military will place a drain upon
all
of
our
industrial
materials
gram has been completed, say by
that will be so great
as# to make
1953, we must expect a drop of
about
two-thirds
needs of the
in
troops
the
we
materiel
will have
renewed
inflationary
pressures
inevitable.
Then, once the initial
equipment needs have been met,
equipped, 'if they are to remain the
rearmament demand will fall
in a training status. Of course,
off abruptly as can be seen
by
even these huge
plans would have the indicated
level
of
replace-;
to be expanded if we are to be
ments, which are far below the
engaged in actual combat, but the
peak expenditure scheduled over
drop that is inevitable when we the months
to the
move
ahead.
replacement level is
great that it is pretty certain
that investors will not place a
so
troops
and
the Atlantic Pact Forces and any
high value
from
upon
business
profits
Investment Conclusions
.
As
we
enter the summer of
arising investors
that is strictly
re¬
1951,
are faced with the fact
that business
may very well con¬
tract unless a rearmament
armament
in
nature, with
the
pro¬
possible exception of both the avi¬ gram of unusual
vigor is actually
ation and
electronics industries, implemented that will
carry ahead
which will be discussed separately.
'
From
can
be
study
a
seen
of
Chart
III
it
that while the budget
expenditures of the Defense De¬
partment
have
doubled
for the next two years. The
scope
of the rearmament
program will
be:
..
..
(1) More than sufficient to
sure
an
as¬
excellent level of general
during business if;; the Administration's
the past year, about half of this plans are implemented;: ..
i.
(3) The weird flight of the two
(2) Cut to levels that will be
British diplomats who certainly gain, or a $6 billion total, repre¬
to maintain
sents expenditures for manufac- entirely insufficient
never should have been entrusted
with top secrets even if
Continued on
they ulti¬ labor costs, but low in the tonpage 2.i
prosperity;, and
24
The Commercial and Financial Chronicle
(524)
their
create
Continued from page 23
expense
Investing Under
a
Rearmament
,
.
,
,
at
general business
of
level
the
provided.
capacity,
...
^
strong isolationists
can rally sufficient
(a) The
sentiments
\
that
well
maintained
tax
.,.
,,
,
t*
.
_
T-r
T\
_
^
_
would
if
even
be
rearma-
be
to
were
schedules.
the
Utilities:
£
sacrifice
v*
r\
*r
ni Avil nlltr
wi
1
^1 i
v>/r/\v,
*
/-I
1
t
M
/"l
n
.
*-
to
were
reduce
rates.
Their
for
records
_____—
"■■ *
1
the
inflationary
with them interest
and
pressures
The
yields on utilities are
favorable and they should
themselves marketwise if
very
assert
the pressures
to lessen.
conditions of
inflation
of
were
critically crowded
highways assure
our
that roads will
continue
have to
fense
(b)
abroad can sell our
Allies that their
sentiments
Pact
Atlantic
of
material,
war
replace-
their
high rate of technical obsolescence
rather than use. Even the Hearst
Press — the mouthpiece of isolationism—is demanding a larger
Cut less drastically by the
Administration call for, so that
politically there is no disposition
(3)
present
Congress
of the
temper
by
our
sake of economy, so that
for the
of rearming the
be maintained
the tempo will be slackened so as
ot avoid the peak of the inflationthe policy
while
ary
the
so
will
World
Free
and the need for
proposed controls which are
unpopular with the Congress;
to economize in either the funds
spent on our Air Force or electronic equipment which is essentially needed for airplanes and
radar protection,
pressures
and
•_
_
^ree
industries
Russia
launcnes
new
a
aggression.
inflated
is
itself
market
the
Since
not
though the business
even
investor who
might wish to avoid the problem
of deciding on the course of our
rearmament program by getting
into a cash position is assuming an
unduly speculative position since:
level
be,
may
measure
the
current
the
he
which
with
accuracy
anticipates the American purposes
and those of our Allies;
(2) The actual supply .U*1UV
of invest~
*
anti-inflation
hedge
characteristics—both
advantages
that
investors
stocks
grade
in^efatiorTto
short
created
to
This
which
group,
nimto'onfetd!-
fJ
those
,.
see)dng
nmtPrHnn
®
,
since
^
they
,
^
pninve
anH
.
Drotection
allowed to charge
are
0/the
oil
pro-
value 0f their crude
production
depletion.
against
Several of the majors have added
to their investment stature by as-
suming
leadership
in
the
fast
purchase
the year
insured
66%
19%
surprise
clear
of
some
home
lenders
were
GI
FHA
loans
"conventional"
dominance
conventional
the
by
—
new
as
the
were
were
The
loans.
all
1950, 15%
and
made
well
as
Of
loans made
mortgage
and
]oans
mortgage
construction.
Dicture
t th
program
national Congress en¬
a piece of legisla¬
tion called the Housing Act of
1949.
It provided for
the con¬
struction
of
810,000
subsidized
public housing units, which would
be built, owned and operated by
the Federal Government through
local housing authorities in huncities
of
in
the
country,
Standing alone, 310,000 units are,
true, only a small fraction of the
total housing inventory in this
country. But when scattered and
placed in specific communities or
cities, these units become an important political influence,
and
even
the
balance
of
political
power in some areas.
To cite an
example, in the 1948 elections, Mr.
Truman won 58% of the votes in
publicized and hence many peopie are apt to believe that home
financing is much more dependent than it is upon the governinsurance
programs. The loans made by our
savings and loan associations were
guarantee
dreds
of
and GI programs are much more
ment
the
day,
may
for the FHA
you
by savings going into:
a
real investment following.
Mining:
Metal
and
predominantly conventional loans the
—84%. Our business relies less
upon the government guarantee
Programs than do the other lend«*• 0£ the home loans made by
commerotal banks only 59% were.
city
Chicago
of
while
Mr
Dewey had 42%. However, in the
precincts where public housing
projects were located, the Truman percentage was 78; .for
Dewey it was 22.
conventional loans, of those by
Despite all this there are signs
insurance companies 46% were that
perhaps the public housing
program is not going to make the
.
leading
The
time been
hobeS^Voters'in
a
one
a^hXave
—^sT^S^
rejected the public housing proIn 1950 slone, 18 cities
mortgage
rejected the program by a public
ground reserve
dominance
of
the
conventional vote
while only six cities apthe
oils,
they
are
allowed
to program
be
continued.
If,
by proved it. The California voters
charge 16% of the value of the chance,
the
FHA
program likewise expressed themselves on
(b) Investment trusts, rather metal they produce to depletion, should'ever become the sole and this question last fall. Apparently
.
(ci) Pension funds whose im-*
will
accelerate, particularly if a moderate decline
should provide a more suitable
buying opportunity;
portance
than
savings banks or govern-
ment
demand
bonds, since the
investment
for
trusts
be
may
influenced
by
the
maturity of "E" bonds
favorably
heavy
the next 3 years;
over
and
metsl c0mp3ni.es like the invest-
oils
ment
Paper
Timber
and
Again these leaders
to tell a home buyer where he
possessed
should buy his house, what kind
of h°"se it should be, and how
much he should pay for it. In
effect> you would have a government monopoly on mortgage
credlt and complete control of all
companies
take
into
the
to
*>een acuteiy uncomfortable at the vice to aid the poor, when in fact
to fall back
were
1946-49
great
investment-and
The fp'pf
tact that
that +hp
the rvihiir
public
m
ThP
(3)
very
sensitive to
inflationary
therefore
to
the long
to
rprnrHc
records
mmp
come
and
prefer
bonds—particularly
as
tho
over
stocks
their in99
22
the
nvpr
is
range
implications
tends
i«
remarkably favorable
so
of
such
catastrophes
Therefore,
can
feel that
we
best
in
the
as
the
dustries which offer extra
this
time.
These
an
in¬
in¬
values
industries
(1) The Aviation and Electronic
the
—
which
armament
continued
American
in
would
to
appear
if
even
following four
values
offer
at
with
...
larly
to
advantaged
ment efforts
are
levels
world
7
.
and
if
in-
good
current
ahead
we
groups
be
our
u
u
particu¬
rearma¬
durable
mortgage, sidized projects. We also deplore
should we run into anything re- the wily proaganda which paints
sembling the Great Depression of the program as a slum clearance
the 1930's.
a
real
We have recognized as
danger that in
a
period of
high
curtailed:
^
u
government-aided
1 non>„
Department
store sales have been penalized
over
the past two years by the
unprecedented
consumers'
expenditures
for
.•
thought of what might happen to the most needy of our population
tho8e houses purchased with a are ineligible to live in the sub-
foreclosure, many of these
properties might be turned back
to
the government through
the
FHA
and
could
become
VA,
and
through which
conceivably
substantial
a
a
pool
tremendous ad-
alone
order
among
to
protection
Basic
pected to rise, making Christmas,
Ownership and Housing
1951,
provide
ence.
against
themselves,
a
memorable retail experi-
Since any relaxing in rearmament will be matched by a
relaxing in controls and taxes, the
Threats
to
Home
Of the Public
^
I
make
savings and
business, through its national organization — the United
loan
years
be
been
and Loan League
on
record
in favor of
a
many
workable slum
program,
administered
for
which would
apart
from
the
public housing program. We have
urged
that government aid be
Progress
~
clearance
May
point clear; the
one
i
the department store sales are ex-
slum
rehabilitation.
clearance
repay
of
opponents
and
stalment
be
must
groups
as
goods dition coulpl be made to the Fed- States Savings
z.
iu:
i.
when it is not anything
of the sort, and which describes
the opponents of public housing
—has
loans
u
...i
program,
whlc+h
^ As
T b+?ughtv°n
mstP1_ eral Government's public housing
ment credit.
these heavy inprogram.
would include:
Zndustries
The
vestment
by
beginning
Merchandising:
fortify himself by
owning the stocks in chosen
at
(3)
enjoyed
now
investment attention
rearmament
Depression and World War II.
vestor
commancj
vparc
from 1929 through 1951 have been
face
that
as
chemicals, is
Our reasons for opposing pub-
the
capital
a
gain upon the profits made on the
range
which timber which they harvest.
In
has now become generally rec- the case of paper, the industrial
ognized as a favorable one for growth, which has been nearly as
panies if they
§r3m.
lie housing are many and varied.
First of all, we maintain it is a
vital part of a program for National Socialism for the government to own and operate a substantial number of our homes,
residential real estate.
We resent bitterly the hypocritiFyer since the inception of the cal attempts of the proponents of
FHA Program, some of us have theprogramtopresentitasa.de-
These
com-
maintain
Companies:
are
banks
insurance
we
of
competing
programs and that the
The producers of the new growth exclusive avenue through which the people are becoming aware
metals like aluminum, magnesium mortgage credit was available, we
radical social experiments
and titanium seem to be particu- would be at the point in the game should be taken only in small
larly attractive investment hedges, where Uncle Sam would be able doses, if at all.
of huge natural resources which
are now on a self-sustaining basis,
life
that
systems
strong
underpositions and, like
(c) Probable purchases of investment stocks by both savings
and
business
ioan
seversl
have
Housing Program
given
to
clear
and
assemble
slum land foi* redevelopment, in
is th4 same no
„ it
hen the full realization that such a
Iarf eJ, u™*8 W1U aJ?am be a^le *° the program was first started back process is far less costly and far
cies switch from world to Hemisadd to their profits by demon- jn 2935
We 0pp0se(^ n then and more desirable than the establishpheric Defense. These industries stratmg the efficiencies of their we 0ppose it now.
It has long ment of public housing projects in
will not be cutback by controls buymg organizations.
t>een oUr belief that should—God the slum areas,
and will fsce no price ceiling
Research
Stocks:
While
the forbid—the government ever asdevastation
the air regardless of whether our over-all polifrom
itself
the position of
our
business
this
S
From the investment point of view
pames
PrS^r^rclT
com- sumeownership "and opeVationof":a subjLt jX"
the chemical and susbtantial percentage of the
ish in
are
na-
in
Tk
K?r drug fields, the earnings of all of
problems since they will
be able the great research organizations
to include any labor costs ap- have been
seriously cut by Excess
proved by the governmental con- Profits Taxes.
Since their new
filiation
agencies
in
their
own
products
are
of such merit
as
to
tion's housing, then surely .and
inevitably a huge hole will have
been driven in the dike-wall of
our
free
Almost
economy.
two
years
to
this
you
in'pafus
Of
in part, is
part it is not
We want
nessmen
on
in
ranks
common
self-
course
the assistance of all busimeeting
the other hand
ciose
ago
are
T
so
To
Present
Situation
»
get on to the present situa- '
a few figures :
idea of just what >
happened in home building in '
recent
years,
and also a back- •
ground for the developments that ♦
give
you an
has
is
types of investment demand
new
afford
cannot
disregard:
Oils:
borne
j0Qk
.
businessmen
tion, the recital of
' '
acted into law
notrft nhLiooi
inrine+rvconventional, etc.
inherently growing petro-chem^cal industry/^
the continuing whose rapid growth has developed
It has for some
.
.
ment
of emergency
are
possessed of
iong_range
the Russian intentions, regardless
of
period
an<j
taxes
an
(1) He cannot possibly be sure of
enjoy
a
real
0f tax protection during
all'
for
in
^2) The leaders in the following
(4) ^Viii be radically expanded
provided
The
Defense Program,
'
fjei^
®
N
believe
that they won't and can't v
Work together in facing a com- :
mon
problem.
be taken
6
dominated the home
means
•
stupid
lie ahead.
To
tically
this
if
together
danger
this
we
threat*
don't all
against the
of
Socialism
at
begin,
:
rounding '
we are prac-
moment
the
peak of the greatest sustained '
building boom in our national '
history. From the time World War '
II
by
financjng
appears—in housing,
y
actually
tion that will
The Home Financing Business
In Partially Mobilized Economy
ments will be dictated by a very
safety lies in
adopting a policy of strict neutrality rather than in building
up their own military strength
with help from us;
of
hope
best
page
it
utilities, medicine, education—surely we leave ourselves *
exposed for the "divide and con-:
quer"
tactics
of
the
Socialist <
planners high in our government, *
then
will
from
Thursday, August 9, 1951
.
wherever
to be built regardless of the direc-
the concept
Continued
.
the
who
The
Cement:
of earnjngS stability during the 1930s
P1"0^- Since their present output wouj^ restore this group to injs subject to strictest renegotia- vestment favor provided a relaxtion, they should be able to re- aj-jon 0f our rearmament effort
without
costs
port materially larger profits and
pay materially larger dividends
in this country; or
upon the expanded business which
The strong appeasement is ahead. Unlike most other forms
viewpoint to enforce
of Hemispheric De~
popular
sales
reduced, and
their profits could be expected to
soar
with any relaxation of the
Economy
...
.
their
felt
ment
the
at
markets
own
of existing products, it is
.
ended, there
irregular
was
an
volume
the
in
advance
of
home!
construction until last year, nearly
1,400,000
ments
This
houses
new
started.
were
not
was
and
-
.
only
»
apart-:
for
:
tremen-
:
improvement of 36% over
the previous peak annual volume
*
all time but it
record
a
also
was
a
dous
of
1,025,000 which
in
1949.
established ;
And atop this residential;
boom there
also
was
of
amount
was
substantial .r
a
commercial
and
dustrial
in-
;
building.
:
This was, then, the situation;
existing at the start of the Korean ;
.
-
War last
ployed
More
summer:
men
em¬
2,400,000 — in the conindustry than ever be(the highest total, inciden-
fore
*
—
struction
)
tally, for any industry); mjore
materials being consumed for construction work than ever before;
,
:
■
finally,
more
mortgage '
being extended to finance ^
new
construction
than
and,
money
private
before.
ever
Shortly
broke
after the Korean War
it was announced by
out,
the Administration in
'
that^
;
Washington
government's
home
the
building "target" in 1951 was to
be 850,000 new dwellings.
The
curtailment from the 1950 output '
of 1,400,000 new houses was to be
.
affected, principally, by
Federal
to
tighten home credit, '
and thus cut down
ive
buying"
houses.
At
recourse
restrictions
mortgage
which would
the "effec-
on
demand
for
■
new;
present, there is
some
'
evidence to indicate that this pro-
'
is working out pretty close
For example, in April,
i
gram
to
plan.
normally a month in which home
building 7 volume 'climbs sharply
upward, housing starts totaled 38,000, some 5,000 below March and
compared with 133,000 for April
of
1950.
- May
housing starts to¬
97,000 and June, 90,000 (es¬
timated), for a total of 535,000
taled
for
first
the
six
compared
months
this
of
to
705,700 in the
first six months of 1950, or 25%
less than in the same period last
year
year.
I
wish
to
emphasize, however,
that this does not
mean
construction
1951
down
to
in
850,000
that home
will
units.
drop
Such
a
decline is
unlikely in view of the
extremely heavy volume of starts
in the first half of this year, al¬
though these in part were the re¬
sult
of
financing
commitments
made
before
the
imposition of
Federal credit controls.
What the recent decline in
building
does
that
procedure
the
materials
and
men
fense
mean,
new
however, is
for diverting
into
the
de¬
from home build¬
ing into the mobilization program
is already well under way.
It is
of
the
utmost
significance that
this
program
transition
of
resources
ceeding
by
in
an
and
the
large,
the
of
use
industry
is
pro¬
smoothly
and with unexpectedly little con¬
fusion and
hardship. To
my
mind,
it serves to underline the suprem¬
acy
of indirect controls—such
"credit controls"
trols"
such
as
over
"direct
freezes
on
as
con¬
home
prices, construction limitation or¬
ders, and an intricate and in¬
volved
patch quilt of priorities and
allocations.
I
want also to point
savings association
business has been heartily in acout
that
the
,
yolurr.e 174
Number 5036
.
.
The Commercial and Financial
Chronicle
.
(525)
cord
with
the
procedure
of
"in-
When the government bonds
could
direct controls" to curb inflation-
buying
ary
market.
be
in
the
If there
is
learned from
lt
that
is
with
controls, plus
the
defense
loss,
experience,
indirect
on
as-you-go' basis, we have one of
l
the best ways to beat inflation.
'
iv\ +
ori An
My subscription to credit
trols
the
as
and
men
home
best
materials
building
is not,
program
the
point where home construction
practically100% casualty of
esty,
and
whatever
all
should
be
m
A
1
ha
made
bo tar
savings
and
that
Attr
'
low
must
be
a so
said
their
on
VA
lending
is my firm
mistitu-
created
was
who
men
riding the
Within a short time after the
action taken by the
Treasury and
the Federal Reserve
not
Board,
buoyantly
housing out-
a
million and
On
the
be
As the
hand,
nitely, without serious instances of
overbuilding beyond market de-
have
not
The
been far
tightening
coun-
credit to effect
off,
of
and
not per-
large investmortgage with-
drawing from the
to
such
see
Let
tion
franklv
tJc
that
credit
meet
is
the
the
sitna-
one
thine
pr0gram,
well
as
building, has not been, as
might suspect, entirely welDuring
the
past
two
months,
there
have
been
loud
W'lat
kind
homes
homes
of
be
restrictions
"]«
the
on
on
defense
like
label
to
this
tortion
of
take
statement
fact.
0utout
homes
of
J
similar
It
could
adjustments
building
is
essential
higher
loans
on
If
of
to
The
to
aw
long been
there
will
believe
show
has
pected
new
that
been
no
interest
further
any
get any tighter.
This has been the
procedure chosen by our
government
to seaire an
and. at the
inflationary bidding
an
rise
In fact,
it is
that somewhat easier
excon-
ditions will prevail in the mortgage market within
prices
up
institutions
our
the
time
same
few months
a
has revived after
^"scare buymg'^apree of last
and
winter;
(2)
of
The
insurance
the new homes that companies that
invested more than
For these reasons, and
$9 V2 billion last year, have a trethe conditions of Tnortmendous investment prob 1 em
built.
because
areas where
defense
for
new
building
should
be tighter this year than last.
will
concede,
g°?d of
there have been
housing industry. First, there was
slight tightening of down-pay-
a
ment
requirements for FHA loans
July, immediately after the
*
-
outbreak
—
~
in Korea
Roonioiion
and
Second
there
The
of
loans
for
the
on
all
tvoes
construction
homes, finally, there
the
was
of
ac-
tion of the Treasury to allow
in.'L
terest rates on
long-term United
x
x
x__
States
Board to
own
i-
Bonds
to 23/4%
and
let
level
to
x
rise
tt
from
the Federal
the
for
States Bonds.
market
'j
i
2J/2%
Reserve
seek
long-term
its
United
Prior to this action,
the market had been
regulated so
that government bonds were
convertible into cash at par or bet-
Many mortgage commitments
made by loaning
institutions,
particularly insurance companies,
the
sale
were
of
Term
in
follows:
Outlook
short,
is
Continued
to be made from
government
bonds,
about
stiff
as
down
payments for FHA and VA loans,
although
the
be
for
eased
drawal
requirements
may
veterans; the withlarge
institutional in-B
of
or
-
vp<?tor<; from thp markpf will
tu..7
nrovp
.5Ii
nothing
resurgence
of
resettlement, means
literally scores-of busi-
finally,
opportunities
building
in
a
builders
maze
;To look
zons
far
large
metropolitan
the
future
of
The
1.1
is
season
advanced
far
now
to make
a
enough
As
to
fair estimate
looks
as
of the U. S.
crops
I have been
for 1951. Hence,
busy this past week
thus
getting
make
to
freezing process, however, should'
ultimately help peas, beans and
tomatoes.
•
■
Statistics
mo
public
dowiT navments
maturities'will
flxed bv
maturities
will be fixed
by
law
fnr
turn
1
c
to
the
nevt
the
same
nre-Korean
has
""""
near
several
indicated
outlook
earlier,
for
home
building is down—to about % of
the volume in
record
Korea, and
1950, which
If
year.
a
peace
new
war
was
comes
a
years, it is likely
provements
and
crops
that further imeven
greater
Roger W. Babson
ample
funds
in
that
to
u
elsewhere, it is possible
building
rise
to
will
about
„
Gov-
however
Cer-
be
million
one
„
permitted
bornes annually. Because
new
a
„
-t
of mill-
tary mobilization commitments
ready made, it is difficult
to
alsee
national
several
made
To
years;
i/would
way,
the
Korean
situation
given
the
all
green
lenders
say
the
of
use
cherries,
the
tilizers
another
seeds
that
private
in
of
we
emergency
of
will
_
the
carefully
*eed
—
corniis
of
case
VMr
Sfh
Thf hX. fn?
these^^stanle fn.iN resK
nf
g
selected'
122nnnnrw>
vear
rLninf the
wUh
3
What About Prices?
revolu-
.
a
per
that
lemons
with
face
close.
eventualities
arn,lnd
nf^ail
ahead
especially
a
and
As to prices, wheat now is about
tionary step. (Modem methods of $229
per bushel, same as a year
selecting layi"g hens are la^ely
ago; corn is $177 compared
responsible for the surplus of
$1.56 a year ago; beef sides are
eggs.)
59c
new buUd"
draws to
and
Selected
apricots
be expected. The apple crop
3^0^
continue
good, about as
may
.
increased
-
with 31,000,000 last
while about the same amount
year;
private
well prepared to cope
are
hold
000 compared
light with
,
Owing to
past
and
S'Soonnn last'
.
it
nut
production-
ba a(,l, ul,u last vear-n'SarsfaMO
VGar- nears
t6
farmers
restrictions
~
there
the
over
of the
juices,
quick-frozen
The
as
loans
advertising
is
the
prices up.
farm
with
machinery
w.u.
modern
the consequences not methods of
furrowing and drainonly of an adequate flow of pering, farmers are raising
more
SOnal
savings, but also coming crops per acre. This is
especially
from the high rate of repayments true where farmers are
using fer-
fr0m
citrus
peach crop is estimated at
would tave
TV ia
,000,000 bushels compared with
demanded
reduced
acreage
for
65,500,000
last
most products
year; pears 32,000,Due
no
be
Federal
r
tition to provoke and extend such
Certainly
the
and
concentrated
in
storage,
for
increasing due to
Recent cr0p failures in California
and Texas should
keep down total
ernment
were
improvements.
quality
fu"
now
demand
-constantly
nrrifia£e
+
The
ram.
.
/i
•1
tainly there will be strong compe-
will
this
•
business,
flexibility will be introduced.
Present
indications
are
that
c^rus fruits in Florida will have
a
good season due to plenty of
ny, aue to tne
a
What Statistics Indicate
As
able
develop,
possible, though un may
a
result
of
all
these
factors, I forecast
a
pond
favor¬
corn
crop
is 8.8c
sugar
a
compared
with
53c
pork is 53c compared
year ago; granulated
year ago;
66c a
with
compared with
8.1c
coffee is 53c
year ago;
compared
of
about
including a
3,300,000,000
bushels, w(th 56c~a year
ago; cotton Is 38c
likely, severe depression in real which would be the third largest
compared
with
39c
a
year ago;
estate and throughout the entire in U. S.
history. The wheat crop WOol
tops are $2.57
compared
economy.
It is comforting to me I estimate will be about
1,100,000,- with
President of the National Trade
as
Artf,n{,a4iftn
000
co„,,inrt
bushels, which should
iar?f^t
Org3™?"0" serving the savings largest
association
our
Sg
business, to
to know
know that
that
business,
rapid growth
legson oi
of
lesson
bad
oaa
loans
luans
was
was
bitter
uuiei
ever
iast
as
$2.15
be
harvested
ab0ut
more
,m0re
year—namely,
the
last
last
year;
rye
little
should
snouia
a
our
should
um.iiri
Ko
would be
business today is far stronger and
safer
dark
than
days
it
was
in
set
when
more
than
20
the
short
term
outlook
(he current emergency, somewhat
dismal, there
is
good
reason
for
optimism in the long-range pros-
pects.
a
i
i
+
^
Peak employment and
ing personal incomes
during
;
'
for home building is, by reason of
x
iast
the
next
are
few
•
ris-
probable
years
year
115,000,000 tons, which
« nno oon innc
flion
8,000,000 tons more than
year.
and
Fewer Potatoes Expected
The
government
has
discour-
aged potato growing with the resuit that the forecast is for only
350,000,000 bushels compared with
439,500,000 bushels last year. This
^eans tbat
the
27c
something
City flood.
I
City, being part
me say
Kansas
Kansas
of
owner
40
there.
mere,
stores
stores
If
while K. C.
compared with
closing let
about
know
this
high-grade
But
cut
flood
years ago
had
little damage
as
said
this
tins
and. real
fact:
iact.
happened
Kansas had
Kansas
had
long
a
drug
20
very
the land had not
Hppa hnilt nnnn
been
built upon.
years
note
note
it would have done
perienced
the
years ago.
While
be
more
year ago;
a
37c
are
year ago.
In
same
1,400,000,-
265,000,000 bushels,
than
tnan
hides
a
000 bushels; barley should harvest
savngs associations,
Vmf T vpntnrp thp nninion
but
I venture the opinion that
that our
our
far
the
harvests
f should
ever harvested,
be about
about
«
in recent
a
a
PVpr
Oats
years- our Ioss reserves against
bad mortgages has kept pace. The
in
is avoided
...
Iran
been
,,
fully
some
neriod '
^CU
been
term
vears
acreage
unlikely to re-' one for many financial institutions harvest 26,000,000 bushels or
level as during durlngLthe dePr.essl0n- '"eluding than last year. Hay cut this
are
p
As
"
the
vear-
probabfy
and
the
this
e
planted
'Y-'.-'V.
Good Fruit Year
has
down
flax-
would be less, but the rice
should be larger. Beans, hops,
peas, tomatoes and cabbage should
yield about the same. The quick-
telligent forecast.
it
crops,
and
seed
in-
an
miscellaneous
if sugar beets
crop
neces-
data
vsary
The
expect
that progress will
continue to be made. Through the
nome
you and relate
thpm to
tnem
to vonr
fnfurp
your own
own husinp^
business future.
billion of
home
our
01
constantly before
a
crop of 3.3 billion bushels of corn and
wheat, largest in U. S. history. Looks for
smaller potato crop, but a
slightly larger tobacco yield. Sees
prices still higher than last year.
'
of
of
0f official confusion and
the leaders of
And for those
and will be the
range prospects
.
i<m
to
as
as man can see.
^firp?ospectsofhome buildinl
building
irom con
areas will cause m turn the
establishment of a vsist 'number of
a vasI "umber Of
esIaD"snmem 01
,
As
hori!
the
of tomorrow, it
will be advisable to keep thp Ion?
centers
Jested
red tape,
nance
b^ildingi
unlimited, almost
appear
of Post emergency home building of you who are
wil1 be in the outlyinS arcas of business leaders
our
real
ahead, to take the long
view o( home
tralization of industry, it appears
likely that a substantial majority,
a11 men
to both
to
and
and
but in
decen_
ThL
moveml^
*
movement away
not
only in
estate*
merchandising, transportation, finance and other lines
home
industry,
For
various
reasons, / including
overcrowding in cities and a naQf
areas,
national
_
ness
and
policy
in
be
^
undeveloped
now
accessibility to a skilled
labor supply. This
period of new
settlement and
building,
when it develops after the emergency, will have broad economic
significance for many segments of
„
and more
easier
with it occurring again.
This
more
plants will
By ROGER W. BABSON
Unfortunately the
a practical nature.
see
also
Mr. Babson forecasts
been
housers—but this has bogged
with all
late?
ter.
were
which loans
Near
financing,
regulations which
increased down-payment require- and
1.
,a?vv", Payment require and
substantially
_
I
and
are
residential communj-
again partly because
1
of
defense policy, and also because of
.
World War II,
They are well prepared, I might
add, for virtually all sorts of
The near term outlook for home
L
y
VA
-it
_
what
0__.
at the moment that will interfere
gage market.
number of swift
a
ttt
—
retail
Crop Prospects
once a
has
tended to do a11 thin§s for
~~with favors thrown in
they will when
be much more active in the mort¬
of course, that
developments in mortgage lend¬
ing that may be somewhat confusing
to
persons
outside
the
influx
an
area"
gap. credltf largely. Hlectu the f°^ing ^Utr 0f thfr.Kin/l0W+,0f with the fl00d tide
_n .^51? in.^ demand that
buying market, it is obvious that not too 2?d
far distant future
credit
„
in critical
credit restrictions entirely
orderly reductKHi in for the
principal rea- hands,
building m order to divert sons: (1)^following
The flow of
sayings into
program,
means
industrial
The Long Term Outlook
that the mortgage market will
or
houses.
avoid
It
areap would
"firming" of mort-
While
to
reason
rates
pay-
and materials to the
defense
ties.
new
small
building is permitted. This is precisely what happened right after
^Si^Se
its
this healthy firming, there is
this
build
recent
overdue.
a
in
to do it is
down
houses when the emergency draws
to a close and an upswing in home
stimulate building in these
be by throwing off
way
_
§aSe interest rates has
still
third
a
way
mortgage market.
dis-
a
is
requirements
the best
requiring
ments
as
available.
than
volume
the
ments
ner-
relaxatl0n procedure adopted
also
if
InmSiS
occasion
There
mortgage credit
cutback of more
program,
this
new
defense workers may occur. We
"ave advocated that the quickest
Dut c edit and home building are
nf pfrablKe- .^ence' tb£.great in7
f
* builders in this current
FHA
and
snare
encourage building
building volume from last year.
They have charged that mortgage
credit has
"virtually vanished." I
"
eovern-
credit
of
amount
be
be
institutions and
shops — which will
service
wil1 be discouraged. Where the
new housing will be built depends,
aSam, largely upon the governJ11611*- Obviously it makes sense
lnh*® Arna af aiff™?private
would
-
will
will
determined lareelv bv
up
much of these savings can be the
basis for down payments on new
American business
other purposes.
cries of protest from builders
who
have been required to slash their
last
re-
quirements for home building and
new
shopping centers—containing
opportunity to1 everything from huge department
their savings.
In turn, stores to financial
anv
come.
I
civilian
as
build
materials
wjjj ke possible to meet
expanded needs of our defense
■
this will afford millions of
Aiherican
families the
adiS itself to^en^M)^ cuUn Administration is still toying with
tTVorAy of critical materia^'-1116 s°-called "Defense, Housing
^hout
r^uJ ion inThe total Pr°gra™" which is aPParently in¬
new
you
are
critical
of
s0 designated.
JwrThas ^how^how'u'muld
mortgage
home
of
v„
vast increase in the
a
production
"critical
market.
any-
reduction in
a
FHA
on
fixed and
was
in ths type of
ors
try. In short, the day of reckoning for the extreme building boom
men
to
year
^—
^
18 months, even if the
semi-war
conditions persist, I would
expect
y2%.
mitted to rise, the market for such
loans has dried
up due to the action of many of the
indefi-
mand in many areas of the
about
rose
interest rate
VA loans
the
Grade AAA
on new
corporate bonds
volume
a
sustained
yield
average
half
a
other
it is also true that such
could
for
were
a
houses.
demand
a
crest of
put of nearly
new
a
„
_
that
associations are also cut-
Within
...
the
as
suspension.
_
.
construction,
there
by
to
•
vantageous.
For, with the outbreak of the Korean War and the
cutback
in
home
meet
like
tions that they keep a good per- ,mitted in a new house. It anoears
centage of their mortgage funds
^ly that a determined effort
invested
If vou par- W1U be made by the
*
" in GI loans
government
cor^i r~?Iro "
non 3. persons! reference, my own to see that nearlv all new build^,
institution has % of its mortgage ™g consists of small single family
portfolio in VA loans. We believe homes in the lower and medium
them to be excellent loans.
priced brackets. Luxury housing
abol-
it
wnnlH
backward,
it
would
seem thst, in one
respect Ht legist,
the
towering volume of home
building in 1950 has proved disad-
to
jn
we
a complete abandon-
our
haokwarH
cooking
may
would
x
Tonkin?
new
I
j0an business do not believe
of
n n It
has
^rnties
However, it
re:comrnendation to
ished.
the
be permitted to
can
point,
say
are concerned, fbere^has
ting down
credit
other controls of
kind
it
®fv'
pos-
controls
a
cus-
other mortgage lenders including
the defense eifort.
Certainly I do
believe that at the earliest
moment
at
ment of this program by large intrance companies and in all hon-
is
feasible
a r«
bonds
VA loans
been
un-
a
and
been
mortgage investors,
conditional surrender to this
plan.
Certainly I do not believe that
these curbs should be carried to
sible
sold
had
At-this
mortgages and especially
th* 4% loans to World yvar II
veterans
unattractive
to
many
new
an
being
building
much farther beyond this.
go
y*eld
defense
however,
how
with-
four point
or
a
V\/-vv%
ernment
con-
from
to
of
which
+
nvn w* An
divert
to
way
into cash
long time, it brought. even
during an indefinite period
to an abrupt halt the
making of 0f national
emergency our housnew mortgage commitments.
The
higher yield now possible on gov- ing production will stay in a state
"pay-
a
instead
tomary for
willingness to put
a
converted
premium
adequate
program
be
out accepting a three
lesson to
any
our
not
housing
new
25
period
estate
of
exex-
dry
promoters
"'Tain't
going to rain no
Thereupon a great building boom developed on this low
more."
land.
But
they
were
wrong.
Moral: Man has not yet controlled
the weather.
After
a
long series
s° many will be °f dry crop
have
destroyed.
Tobacco, however, is suie to follow, ana alter we nave
Up^
forecast being 2,300,000,000 good rams, as has been the case
poupds compared with 2,000,000,- since 1933, dry years are sure to
000 pounds last year.
follow.
yea^» ^fie/we
26
Chronicle
The Commercial and Financial
(526)
Continued
from
2
page
the
Some
of
erties
are
Continued
producing prop¬
oil
fro mpage 4
Thursday, August 9, 1951
;.
.
'
<
located in tne Oklahoma
field, the Texas Panhandle,
Texas, a recent discovery
Nebraska, and
a
new field in
Stephens County,
Oklahoma. The principal gas pro¬
City
The State of Trade and
West
The
Security I Like Best
tial lease interests in undeveloped
and locations:
Location
Acres
//
securities
long-term
I
capital
CARL STOLLE
5,000_—.
—Mississippi
—-Kentucky
6,000—.
.--.Illinois
continues
Wyoming
tion
investor
acres
of
light
Nebraska
so
company
the
continued
and
expectant
de¬
for
the
o f
industry.
products
this
program
An interesting
that at the pres¬
participation
ent time the company
is really an
In 1950 the
participated in the drill¬
exploration
and
of
mand
under
are
negotiation in Montana.
An extensive drilling
instituted
over
under lease and
are
block of 30,000 acres
atten¬
fancy,
it would seem, in the
so,
Indiana
State
field
oil
and
gas
attract public
to
and
rightly
No. Dakota
Industries
Oil
natural
The
.—Colorado
6,000—
the
Kerr-McGee
—Oklahoma
20,000—.
was
finest
for
President, G. A. Saxton & Co. Inc.,
New York City
Kansas
20,000—.
15,000—.
6,000—.
a
the
seen
Texas
10,000
500,000
of
one
appreciation.
50,000
25,000
In
as
in the following amounts have
acreage
in Banner County,
be found
may
company.
the
in
ing of 66 wells with the following
com¬
mon
stock
Kerr
-
results:
of
McGee
Oil Industries,
Inc.
oil producers
43
2
Carl
Stolle
O f
drilling at year-end.
utmost
importance in
discussion of any enterprise
28%, from 603,000 to 774,000 bar¬ is the matter of
management. A
rels in 1950.
study of Kerr-McGee starts out
The
exploratory program for with the success story of a young
1951
has
also
been
successful, Oklahoma lawyer, who, in the
some 48 wells having been drilled
course of his work, drew
As
in
result production increased
a
the
first
six
with
months
24
completions.
The program calls
for participation in the drilling
of
85
for
wells
in
first
the
1951.
six
Production
months
totalled
450,000 barrels.. The management
that
states
exceed
for
runs
million
one
increase
66%
old
of
30%
will
barrels,
1950
over
1949.? This
over
1951
will
an
and
mean
the
oil
leases.
the
from
to
interested
Becoming
business other than purely
the legal aspect, he began
establish himself
This
erator.
Kerr,
who
man
as
oil op¬
an
Robert
was
S.
later to become
the State of Okla¬
was
abandonments
as
and
intangible
drilling expenses. It is interesting
to note that the quality of the
production is improving—by that
I
that in the past few years
the reserves of oil of the company
mean
being developed in sand rather
are
than in lime.
his
to
political
In
propen¬
worth
its
company
the value
as
is
of
of oil in the ground.
reserves
The company now admits a mini¬
mum of 12 million barrels of oil
which has
cents per
a
a
reserve
barrel,
of
the
value of
80
$9,600,000, and
$31,800,000. The
or
market value of
shares
company
are
cur¬
rently selling for $5,300,000 with¬
out the working capital of
$1,000,.000, or just a little over one-half
of the value of its reserves
com¬
puted at only 80 cents per barrel.
Putting it another way, you are
buying
oil
at
40 cents per
An
the
equivalent
of
barrel.
inspection
of
account shows cash
income
the
earnings after
operating and general expenses of
$1,389,146 in 1950 as compared to
$1,104,238 in 1949. Charge-offs for
surrendered
leases, abandonments,
dry holes, depreciation and de¬
pletion, taxes, etc., resulted in net
income of $649,119, or $0.72 per
.
share
in
$352,264,
1949.
1950,
or
as
$0.39
compared
to
share,
in
per
These results
were
obtained
from gross revenues of $2,300,000.
With probable gross revenue of
$2,700,000 for 1951, cash earnings
should exceed $1,600,000, or
nearly
$1.80 per share, most of which can
be utilized for further expansion.
The capitalization
is simple:
and
$161,774
com¬
of
5%
sinking fund debentures due July
1, 1955.
the
and
rate.
rate
are
were
of
10
.dustry.
cash return
Mr.
tract
which
with
Phillips
the
is extremely
000 in
fund
a
from this issue. I regard this stock
enjoys
which is
for
used
exploration and wildcatting.
Net
results of these operations are di¬
vided 50-50,
The company has been a prof¬
itable enterprise starting from the
beginning.
Dividends have been
paid at conservative rates for the
past 15 years with the exception
of
1939
1940.
and
For
th^ first
one
was
in the know-how of
leader
company
receiving
from
Output in
of
totaled
for
entire
week and
a
industry,
month
tons of>
compared
A year
ago.
to'
ago;
Mildly from Previous High Level )
electric
the
latest
reporting
declined
week
slightly from'
'7,005,261,000 kwh. in the previous week.
total
was
2,052,000 kwh. below that of the pre-*'
Point Higher in Latest Week
;
819,875
cars/caccorffl^ttd/'the/Association of American"
Railroads, representing;an rnecease of 15,305 cars, or 1.9% above*
the preceding week.v
* !
The wdek^^otaT represented a decrease of 25,136 cars, or;
.
3%
the
below
corresponding week
in
1950, but
an
increase of"
95,831 cars, or 13.2% above the comparable period of 1949.
*
now stand at just
trillion feet of gas and
used
the
current
Auto
Output Continues to Decline Due to Shortages and i
which
is
-
Loading of revenue freigbtTo:pthe'Week ended July 28, 1951,;
"
income
a
Carloadings Continue
proper¬
Labor Troubles
"
^//Combined motor vehicle production in the United States and ;
Gdh$raa1;he past week, according to "Ward's Automotive Reports,",
totaled 116,924 units, compared with the previous week's total of '
132,378 (revised) units, and 175,062 units in the like week of 1950.:
oil,
dividends are meager, amounting
to only 25 cents per share. Most
the
for
'■/■' ; /
/■
is equivalent to 2,021,000
ceding week, 755,745,000 kwh,, or 12.1% above the total output forweek ended Aug. 5, 1950, and 1,537,205,000 kwh. in excess of/
the output reported for the corresponding period two years ago.1
around 12 V2 million barrels of
of
':>/■;•/
the
of the company's con¬
stant search for more oil and gas
a
this week
level of
Tne
Because
under
castings
and
amount
its high
ties, including equipment and pipe
and, what may be more impor¬
tant, certain leaseholds which the
company feels have definite pos¬
reserves,
announced
Institute.
In addition to this, the
sibilities.
(
energy distributed by the electric J
light and power industry for the week ended Aug. 4, 1951, was
estimated at 7,003,209,000 kwh., according to the Edison Electric'
of some 2 Vz million bar¬
other
.
operating rate
2,029,000 tons
or
The
very large acreage in South Da¬
kota which the company has had
received
week's
Electric Output Tapers
a
company
Steel Institute
and
week ago.
101.5%,
recent
reserve
When they do grow to.
on the alert for a
it stood at 99.9% of the old capacity and amounted to 1,926,800 tons..
in the Near East.
rels of oil.
a
...steel-ingots
which borders
highly interesting dis¬
coveries, is a leasehold interest in
a
and
American Iron
This
con¬
a
Another venture,
on
yet an established trend.
The cancellations are.
they do not involve large tonnages.
They are,
not
having 93% of the steel-:
making capacity for the entire industry will be 101.1% of capacity
for the week beginning Aug. 6, 1951, or a decrease of 0.4 of a point/
con¬
tract,
area
by the inventory he has accu-/
exception, rather than the rule..
the
The
This ex¬
perience and knowledge resulted
the
r
that the operating rate of steel companies
ducting such operations.
in
/
proportions steel people will be
/changing market, concludes "The Iron Age."
addi¬
the United
For
tional
exploratory and drilling
purposes with the consequent re¬
year which ended on June 30, net
sult of building up common stock
earnings,
before
provision
for
Federal and State income taxes, equity. Capitalization consists of
bank loans, oil payments oh the
were
$854,000 or 76 cents per
recent
Crosby Oil purchase, a
share.
Income taxes are held to
small issue of
preferred
a
minimum by the fact that the very
stock and 1,052,624 shares of com¬
company is so widely engaged in
mon stock.
drilling
operations
and
thus
If you are searching for a stock
charges off for income tax pur¬
with which you may have to be
poses a large amount for intang¬
nine months of the present fiscal
States
114,519 /
units, due to labor,
alone, total output declined to
units from last week's revised total of 124,138
disputes, suspensions and material shortages.
In the like week of
.
ible drilling
ing
costs.
revenues
for
Total operat¬
the first nine
patient
which
but
ultimate
handsome
months of the present fiscal year
would
just under $14,000,000.
An important phase of the com¬
pany's business is its Contract
further into
were
Drilling Division. Some 29 drill¬
ing rigs are owned and operated
this
is
number
of
considered
rigs
for
let out
on
of
work
are
some
a
Harold
as
well
the
as
southwest
and
on
La
Mr. Sem¬
Salle Street
Despite this decrease, casualties were more numer-:
ago when 168 occurred and even with tne 1949,
year
Casualties
'
when
involving liabilities of $o,000 or more ut^mcd to •
week, being slightly less numerous than in 1950 :
149 last
137 from
141
concerns
succumbed in this size group.
Food Price Index Records Further
Mild Rise
>
(Special to The Financial Chronicle)'
CLEVELAND, Ohio
O.
in the Gulf of Mexico.
a
Continuing below the prewar Wei
re* *-11
low;
the 277 which were recorded in the comparable week of 1939.
Remer, Mitchell & Reit¬
Keel
is
now
—
>
Stanley
affiliated
with
sec¬
west
than
in the week;
184 in the preceding week, Dun & Bradstreet,;
total.
of'Reiner,
July 25.
Slightly
Commercial and industrial failures dipped to 171
ended Aug. 2 from
Gottron, Russell Adds
Gottron,
of
Business Failures Ease
;
.
prices
were
mixed last week.
The wholesale
price index, compiled by Dun & Bradstreet, Inc., again edged
higher to stand fat $6.91 on July 31 as against $6.90 a week earlier.
The current number compares with $6.53 at this time last year, or
food
numerous
leasehold interests in various
tions
Sembach
totaled 5,741 cars and 2,499 trucks against 1,668
735 trucks in the like 1950 week.
and
cars
Trends in food
account, the
acquired
Canadian output
looking
Reitzel, Inc., Chicago,
zel for 20 years.
doing work for others and
own
J.
&
bach had been in
and with
doing the
drilling
period of time, in the
its
cars
ous
passed away
and
28,677 trucks built in the United States and a total of 1,715;
and 690
trucks built in Canada.
In the previous week, J
and
Inc., reports.
inden-
contract to other firms,
Kerr-McGee
Over
own
2,403 units in the corresponding 1950 week.
for the current week was made up of 85,842 cars:
Total output
Harold J. Sembach
an
for
year
and
this situation.
Mitchell
operator. Some of these
output totaled 173,169 units.
Canadian output in theweek totaled 2,405 units compared with 8,440 units a week ago,
last
should show
returns,
it
worthwhile
sizable
used
its
be
a
dent
has
should stay far away
company
Petroleum, under
which each year Phillips provides
$750,000 and Kerr-McGee $250,-
company
in
apparatus.
is
numerous
still
was joined for some time. Some preliminary
McGee, Vice- work has been done with Phillips
Senior Operating Petroleum on these properties.
McGee
on
interested
originators
This
not
he
thought of by the Phillips
people, as evidenced by one con¬
course
investor
of the
of off-shore drilling
It
is a recognized
company
.
mulated.
significant
lands to the states.
The
its customers that he is embarrassed
Government
ownership of the Tidelands or as
soon as and if the Congress votes
favorably on a return of the Tide-
\
And
when;,
Actually, states this paper, the first glimmering of inventory ;
is already showing up in the steel market.
Several ',
orders have been cancelled by consumers seeking to adjust their ,
inventories.
In another case, a steel mill has been told by one of.
was chief geologist of
Several months ago Kerr-Mc¬
Phillips Petroleum and who is Gee purchased the Crosby Oil
generally considered one of the
Company,
which
they
expect
top notch executives in the in- will
result, after oil payments, in
exploring
share
they find their inventories growing too large.
here as soon as the In¬
Department
reaches
an
agreement on operations under
States
the
correction
terior
United
that many others will cancel steel tonnage
is assuming
Man, who
cents
per
it
agement that very substantial re¬
serves
of
natural
gas
will be
the
much steel as they are allotted.
customers will not order as
the
in
blocks
production—by
match
later.
It is quite, a paradox that NPA is. counting"
heavily on natural, free-market forces to make its controls over,
steel distribution work effectively.
It is assuming that many;
first quarter, or
A.
and
initiated in 1949
likely to continue at that
An
Dean
President
job.
Dividends
at
Mr.
and
of Kingwood
896,000 shares of
stock
mon
by
scope,
well
oil
much
as
the early 30s grew
in size and
.
A /producing
three
Island
addition
revenues of approximately
sities, he is an able oil man who
$2,700,000 with net income of
knows the industry thoroughly.
somewhere between 75 .cents and In
1937, as the company which he
$1 per share, depending on such
had founded in
surrender of leases and
in
will
tickets
steel
realistically—that
Ship Shoals and in the Vermillion
areas.
It is thought by the man¬
States Senator from that state.
gross
write-offs
important phase
company's operations and
future
possibilities
lies in the.
Tidelands area off the Louisiana
coast.
Here the company has an
interest
Materials Plan is not'
seeking to bring about with its Controlled
possible of attainment before the first quarter of 1952.
But so far there is no guarantee that CMP will be operating/
the
homa and is at present a United
of
is
products.
recently completed, to su¬
pervise drilling in the Kuwait
Governor
brought into balance this year, this trade authority declares. Even;
the "artificial" balance which the National Production Authority ,
development
the
in
'
they are based on a terrific volume of business. Production and
shipments during the first half of this year topped last year's'
11%. At the same time Federal income'
taxes are more than 100% higher, states "The Iron Age."
*
There is no chance that steel supply and demand will be'
One extremely
of
up many
in
these
with any other period except the record-
all-time records by about
Owens-Corning-Fibreglas
Corporation
Steel
shattering second auarter of last year, this trade paper notes/
i
Second-quarter earnings of the nation's 10 top steel producers
(rated on capacity) rose 8.6% above first-quarter profits.
But
their earnings for the first half of 1951 are 30% less than they
were during the first half of last year, it points out.
Dollar-wise, these financial results are still excellent.
Yet
production from each field. In a
refinery located at Wynnewood,
Oklahoma, one phase of its opera¬
tion consists of the production of
asphalt for which new uses are
being found, such as the impreg¬
nating of fibre glass with asphalt
for the wrapping of gas pipe lines.
The company has been working
of
Industry;
Higher costs, largely taxes, are to blame, it
earnings during the second quarter of this year,
steel trade.
look very good compared
Spider fields in Louisiana. Space
will not permit full discussion in
detail of the number of wells and
with
the
asserts.
ducing areas are the Texas Pan¬
handle
and
the
Carthage
and
proven
171/2.
dry holes
5
sell¬
ing at around
wells
gas
16
now
of
Russell
Commerce
&
Building,
Co., Union
members of
the Midwest Stock Exchange.
a
gain of 5.8%, and represents a rise of 15.9% over the pre-Korea/
$5.£-3.
The index represents the sum total of the price per pound of 31;
level of
foods in
.
general use and its chief function is to show
trend of food prices at the
wholesale level,
the general:
Volume 174
Number 5036
.
.
The Commercial and Financial Chronicle
.
(527)
Wholesale Commodity Price Index Edged Lower in
-
Continued
from
3
page
a
Latest Week
A
further
&
Bradstreet, Inc., to
The index closed at 302.09
July 24,
and with 280.71
Grain markets
low since
new
a
on
on
Chemicals—Foi Growth
July 31, comparing with 302.76 on
the corresponding date a year ago.
for Spring wheat.
'
'
■
■
•
.
■■
f
'
1
i
•
'
/:}
1
''
j
•'
'
■
■
''
■
Although current export business remained slow, the market
strengthened in the late dealings on the announcement of heavy
v
wheat export allocations for September and
ing strength at times,
market
receipts resulted
in
considerable
ticularly in the September delivery.
much
October)
prices moved irregularly
corn
for the crop remained
good, although
in some areas.
Oats were quite
Larger
hedging .'pressure,
Weather
improved throughout most of the
While show¬
lower.
conditions
belt'and
corn
Domestic
!
flour
rather
firm, but latfge stocks and
sharply
as
offerings of
business
generally
was
new
slow
the
crop
past week
lcf$£$r for the week.
reportedj|| 3,137,981 bags,
period las$y|ar. Warehouse
prices
declined
livestock
in
best
today's
Monsanto would
or
It
is
quite
not
judgment
of
lower priced
to mull
capital
items,
of
streamlined,
however,
market,
hogs and steers
holding steady.
Trade
ago,
when <sales amounted
Public
Fractional
a
As very warm weather
prevailed in many parts of the nation
last week, consumer
buying dipped fractionally;*. The dollar vol¬
of
ume
retail
trade
declined
slightly
in
the
period
ended
on
Wednesday of last week; it remained moderately below the high
level of the comparable week in
1950, according to Dun & Bradstreet, Inc., in its current review of trade.
Many shoppers con¬
tinued to spurn high-priced merchandise.
•
;■;
The usual seasonal lull in consumer demand for
apparel was
in evidence in many localities the
past
Summer
There
i
to
one
still
are
old-fashioned
Housewives reduced their purchases of
tent, but aggregate volume
year ago.
The
was
grocerffs to
a
moderate
few
a
slated
type
—
for
probable
break-up
the
over
to
so
that they
can
*'
Standard
Power
Standard
Power &
.
Department store sales
on a
the Federal Reserve Board's index
as
taken from
for
the week ended
July 28,
1951, decreased 21% from the like period of last year. A decline
23% (revised) was recorded in the
previous week from that
of
of
a
year ago,
ended
and a decrease of 15%
July 28, 1951.
[registered
an
Retail
For the
advance of 6%.
trade
in
New
year
is shown for the four weeks
to date department store sales
^
York
last
week
closer to the high level of the like week
.a
return to
more
normal sales
a
year ago,,
following the buying
in
American & Foreign Power $6 pfd._„_.
American & Foreign Power $7 2nd pfd.
American & Foreign Power common
f
According to the Federal Reserve
Board's
decrease of 5%
year
to date,
For the four weeks ended July 28,
1951,
was recorded below that of a
year ago, and for
volume advanced
•.last year.
9%
from
the
like
period of
to
buy
mutual
through
effective
invest¬
supervision, and representa¬
in
all
the
lines
that
have
chemicals fabulous.
if
growth
whether
is
of
one
from, the
your
soil
by
fertilizers, from the oil with the
makings of plastic and fiber, or
from the dome with sulphur, then
you may want to start pouring a
**
little
of
your
into
money
the
classy chemicals.
Highest Merit Award to
Nestle-Le Mur Go.
Nestle-Le
Mur
Company
just received a citation for
the "Highest Merit Award" made
by the "Financial World" in recog¬
11-15
10
nition of the excellence of its 1950
-
annual
This
in
163
—
—
6
20
102
89
y4
New England Public Service $7 pfd.__.
New England Public Service $6 pfd
Plohn,
a
Stock
Exchange, is
2
175
148
160
132
6
8V2
40-50
Charles
member of the New York
a
director of
Company and
With Fulton, Reid
14
11
—
shareholders.
also in charge of their public and
stockholders' relations.
141/2
100
to
the Nestle-Le Mur
90
119
report
qualifies them to be judged
"Best Industry" award to
the
be announced in October.
61/2
—.
(Special to The Financial Chronicle)
.
,
/
CLEVELAND, Ohio—George S.
Kendrick is with Fulton, Reid &
Co., Union Commerce Building,
71/2
81/2
members
40
of
the
Midwest
Stock
Exchange.
tN/Y. Stock Exchange.
$N. Y. Curb Exchange.
§Over-the-Counter market.
The
above
list is not
intended to
T. H. Jones Adds
(Special to The Financial Chronicle)
be comprehensive.
CLEVELAND,
There
Ohio
S.
—
W,
Plesco is with T. H. Jones & Com¬
several smaller
holding company situations, such as Wash¬
ington Gas & Electric.
There is the important North American
Co., which will probably eventually merge with its remaining
utility subsidiary, Union Electric of Missouri, although the SEC
are
pany, Union Commerce Building,
members
of
the
Midwest
Stock
Exchange.
has not yet in *
icated its position in the matter. There are various
holding company preferred stock "stubs" representing claims for
redemption premiums, which claims are now slowly being ad¬
judicated by the SEC and the Federal Court (the cases of Electric
Bond and Share preferred stubs and New England Public Service
prior lien preferred stubs have now been settled).
Federal
endless
Water
litigation
&
of
Gas
the
will eventually
Chenery
group
land
Utilities
Company and Midland Realization Company, is
slowly dragging along.
Thus there are still a large number of
"special situations" although a majority of the big holding com¬
panies have
In
now
the next
been cleared up.
issue
the holding companies
we
will
comment
With Butler, Wick Co.
(Special to The Financial Chronicle)
YOUNGSTOWN, Ohio —James
M. Chrystal has become associated;,
with
be dissolved, but the
has long delayed the
be paid to stockholders of Middle West Corp. around the end of
this year.
Final liquidation of two other Insull companies, Mid¬
28,
the similar week of 1950.
the
70
index, department
york City for the weekly period ended July
11951, declined 18% from the like period of last year. In the pre¬
ceding week a decrease of 14% (revised) was registered under
-a
100
final proceedings.
There are also some remnants of the old Insull
empire to be disposed of; a final liquidating dividend will probably
spree
r:
thousands of
preferred
*See comment in text.
coming
which marked
X44
incident
to the Korean outbreak.
•store sales in New
'
succeeded
164
165
•
International Hydro-Electric class A (com.)
American & Foreign Power $7 pfd
t
t
many
country-wide basis j
Mkt. Price
187
100
England, South, and Northwest —4 to —8; East —1 to
-—5; West —8 to —12; Southwest and Pacific Coast —3 to —7.
,
Value
Light 7% pfd
Light common
Standard Power & Light B common..—__
Internat'l Hydro-Electric
$3.50 pfd. ($50
New
Buyers attending major wholesale centers were
than in the corresponding week of 1950.
complex is this
has
Approx.
&
Central Public Utility debentures
numerous
is
tion
goals,
'
§
moderately less
field
Glidden
ment
So
Recent
Break-Up
Standard Gas & Electric $7 prior pfd
Standard Gas & Electric $6 prior pfd...^
Standard Gas & Electric $4 2nd
pfd
Standard Gas & Electric common
New England Public Service common
Northern New England common.
defense goods.
have
chemicals
made
better judge the worth of the esti¬
Traded
a
merchants
placed an increased volume of orders in the week.
The dollar
•volume of wholesale orders continued to be
slightly above that of
a year ago, although the
year-to-year rise was largely confined to
and
many
diversification,
The break-up estimates are of course de¬
assumptions and calculations, as well as being
general market fluctuations, and hence may prove
§
§
§
§
season
fertilizer
frits;
The
'
preparation for the Fall selling
entering
by Diversified
Fund
Inc.,
and
Group Securities; and Chemical
Fund, Inc. Here you get wide
next
many
Total retail volume in the period ended on
Wednesday of the
past week was estimated to be from 4% to 8% below a year
ago.
.Regional estimates varied from the levels of A- year ago by the
In
is
about the chemical shares offered
*Est.
following percentages;
;
on
t
bakery products.
earning
funds. If that idea appeals to you
then by all means inform yourself
Part II
remaining holding companies of the
dip in buying
of
glass
investors
with the methods by which the break-up estimates
prepared by Wall Street analysts who specialize in the various
f
was
of
i
commercial
their
Where
dipped slightly, although poultry and
cold cuts remained popular..„
Dairy foods and bottled beverages
were
in large demand.
Purchases of coffee' and tea slightly
There
for
mates;
meat
exceeded last year's levels.
net
live company
Corporation
So diverse and
four years—depending on the tempo
situations,
^V™'""]''?■*■
demand for
Montana
and
gross
32. A
expansion
industry that
themselves
are
some ex¬
approximately equal to that of
Butte,
currently inaccurate or eventually "wide of the mark."
Pros¬
pective purchasers of these stocks should therefore familiarize
,
,
in
solid
the
Utility Securities
accompanying table gives -estimated break-up values and
however, continued to draw :a* rather large
response.
Housedresses, beach wear and men's shirts remained
among the most popular items. Displays of
EalLapparel became
more numerous
during the week, although shopper interest was
negligible.
in
a
elec¬
Chemical, Dewey and
Spencer have
also
aggressive managements,
Ferro
recent market prices.
week.;»Clearance sales of
apparel,
has
power.
Virginia-Carolina Chemical has
Holding Company Securities
subject
Decline
Works
phosphorus
and
shown
and
By OWEN ELY
pendent
Reflects
stock
sprightly
more
loaded with soy bean derivatives,
and new "fine chemicals."
\
.
Volume
fi¬
doubt be
Heyden
.
year
been
this
factor in making for
a
Around
Almy,
Cur¬
of SEC and Federal
Easiness in spot markets reflected
selling influenced by slow
Court activity. In all of these cases there are contests of interest
demand and reports that,: some mills
were
selling surplus^rw/between representatives of various stockholder
groups.
In the
stocks of the staple.
V
past, these contests have sometimes prolonged the legal proceed¬
Demand for cotton gray goods remained auiet and. further
ings for many years.
However, as all of these holding companies
curtailment :was reported in mill
have already been through many years of negotiations with the
activity in the South. /Some
improvement was noted in export demand for .cotton, but sales
V SEC and have already been partially streamlined, it is not un¬
volume continued small.
Reported sales in the, 10 spot markets
reasonable to
expect that they will finally "go through the
last week were somewhat larger,
totaling 39,900 bales, as com¬
wringer" within the next two or three years.
pared with 27,100^. bales the previous week, t buLicontinued well
The
a
to
ex¬
with fine management.
mill
below the corresponding week
be
highs
1951.
moderate
Although futures cotton prices were relatively steady last
week, values in spot markets declined steadily to reach the lowest
level in more than a year.
to 192,500 bales.
furnace
with
In the Chi-
registered
now,
no
common
a
Chemical
can
new
earnings could
expand to possibility $4.50 a share
annually and justify something
more than $1.60 current dividend.
Also, impressive potash and phos¬
phate reserves here could afford
rently around 36.
possible,
to
up
and
$5,000,000
tric
that
company,
hedge.
share
sometime
be in
Victor
new
$10,000,000 phosphate plant now being
built, and the recent acquisition
of Innis Speiden
& Co., a fine
inflation
by
position.
new
a
but
then may
1950 sales of $58,402,000 and cur¬
sales
nearer
a
$70,000,000
valuable
vicara,
Attempts
amount
nancial structure will
rent
With
dividends.
this
successful
Corp. is the largest in the
agricultural chemical group with
a
protein,
change have not,
following
International Minerals & Chem¬
potash
natural
back
settle
might like
you
of the
over some
rate.
fascinating
a wool-re-
Products. The preferred has $73.50
larger
from
a
gain
suggestions.
annual
the
and
placing
steadily
government support program for cottonseed oil.
cago
prove
onto
investment
into question.
The refined sugar market was quiet with some easiness noted
in the South.
Lard and vegetable oils trended higher on
reports
advances with lambs
might
latch
to
your
-
a
al¬
the
which
most ;pf the week hut
developed a slightly firmer tone at the close as
$he result of trade
buying and short covering.
of
not
ing
bring
contrasted with 3,208,133 in the same
stocks totaled 179,480 bags, compared with
279,90S a year ago.
sugar
we're
wonder¬
Chemical
remained quiet and spot values moved
arrivals so far this year were
Raw
(if
and
ready aboard this ship)
market. The Big Six have been
consistently good and command
a
legion
of
market
followers.
Surely a line of du Pont, Allied
except for some activity in hard Winter wheat flours, attributed
a
large southwestern chain baker.
Manufacturer demand for
Cocoa
find ourselves favor¬
we now
shares
5
:
icals
industry,
to
cocoa
business,
produced in association with Corn
search is for
your
acid, and may do so it new pro¬
ductive capacity can bring costs
ably disposed toward the chemical
prospects
that, if
percentage
So
further arrivals of Canadian oats tended to hold demand in check.
■j
Rye prices declined
grain increased.
a
down.
par¬
were
running one-to two weeks
late
phosphate demand has hit
newvpeak, and 1951 plant expan¬
sion "in this segment of the indus¬
try alone will exceed $25 million.
Actually phosphoric acid can, in
many uses, replace scarce sulfuric
have
may
growth possibilities of
were
rage,
Both
position of the fertilizer end of the
And Net Proiits
irregular last week with, prices moving
in a fairly narrow
range.
Wheat closed higher after striking new
lows for the season early in the
period, influenced by increased
marketings of new crop grain and generally favorable prospects
\
Earnings
late last November.
127.
future dictated by the favorable
a
in the general commodity price level
brought the daily wholesale commodity price index, compiled by
Dun
around 14 and 6% pre¬
common
ferred about
slight sag
27
of
the
Stock
listed in the table.
on
the status of
Co.,
Union
New
York
and
Midwest
Exchanges.
Joins Woolfolk Shober
-
/;
(Special to The Financial Chronicle)
NEW ORLEANS,
ga
Harris
D.
with
briefly
Butler, Wick &
National Bank Building, members
Woolfolk
Gravier
New
Street,
is
La.—Mrs. 01-
now associated
&
Shober,
839
members
of
Orleans Stock Exchange.
the
20
The Commercial and Financial Chronicle
(528)
Continued from first page :
neglect, among the rank and file. That is cer¬
Perhaps—and we fervently hope not—the teachings
of "Mein Kampf" or of the Kremlin have left their mark.
Whatever the origin or the causes, the indications are
distressingly clear at times. Take this whole myth of col¬
lective bargaining or the almost universal contempt with
which labor unions treat their "contracts" with employers,
tain.
It
We See
As
not to say
;
basic rule of conduct which man
will observe in his dealing
then the very foundation of human association
We have, of course, not reached such a stage as
yet—and heaven forbid we shall ever reach it—but it
appears distressingly evident at times that termites are
attacking the underpinning of society.
i
with man,
is gone.
Recent
brief
A
of
review
and the utter lack of
generally.
daily indi¬
cations that "honor" is in danger of becoming the forgotten
word of this day and time.
It is this background that
lends to the West Point scandal a meaning and an aspect
which is very disturbing.
concern
among the people
One indeed needs but to look about him to see
History
recent
history should provide a
sort
Continued
opposition party)
Then
decade
came
a
ing
us
other
as
on
than
bad faith.
And
so
the
New
of
inclined to embrace
to
to
good
came
our
There
a
-
Deal
great many, if not
of
this
some
a
country, and
to
scorned the basic elements of fair and honest
one's associates in
dealing with
day-to-day life.
A
to
good deal, but by no means all, of this had begun
come
to life
prior to the 1948 elections. Candidate
Truman
dubbed
the
disclosures
"a
red
herring" — and
proceeded to get himself re-elected by a large
majority.
Disclosures have continued and indeed
greatly multiplied
in number and
importance since 1948. The President has
shown little
concern
about
them, his inclination
appar¬
ently being to stand by his political "buddies" regardless.
So far as one
may judge, his political standing has been
up and down since 1948, as indeed it has
always appeared
to do in the
past. The important question is this: Have
the great rank and file become
is going on? Have
really aroused about what
they reached the point where they are
ready to start the long, arduous task of cleaning house?
discussions.
today in
another. There are dis¬
day-to-day dealing with one
turbing indications that the moral slovenliness
characterized
so
which has
much of government for so
long a time
•lias
seeped into the behavior of mankind generally, Pos¬
sibly It seeped frdm the public into government. It could
not have established
itself
so
thoroughly and
in government had it not been for
a
avoid
in
such
are
the
priour
our
that
we
what
we
say or
advocate on these subjects
which
bear
so
heavily upon the
happiness of our fellow citizens and conceivably upon
welfare and
the future of mankind.
;
the
hearts of men all
at the
the
Great waves
world.
Perhaps it
to maintain
maps
if
a
proper
with
prayer
a
in
keen
we
for
times in
sand
hundreds of Amer¬
communities
that
spread.
V
in
Leadership
ask
ourselves, at this
why have our men been
fighting in foreign lands?
The
answer is plain—tne United States
Let
of
America
herself
finds
cast
not
come
in
This
about through deep
and consummate
design. No group
in this country sought such a role,
We have had no intent of inter-
fering with the peaceful progress
of other peoples.We havewanted to
help—not dominate. This has been
our national policy; it is the desire
of our-.people.
But history has
cast us in this role, quite suddenly,
It is possible that we have not
prepared ourselves fully for the
obligations which are inherent in
such a position.
We, in private
life, have no way of accurately
judging the pros and cons of our
world policy as it develops step
by step.
We can only hope and
trust
from
that
our
among
will
us
leaders,
to
find
courageous
It is
elected
handle these
and
and
pursue
a
honorable
enduringly_
callousness,
no
in
this
comforting to realize
way:
"It is all
a
.
L
antuliw
under which people may actually
govern tnemseives.
,
.
can be an all-powerful Parliament
or Assembly or a Politburo.
In
any of these forms it is thought
that he can get things done and
Mr.ny even
think you can have this and personal freedom, too.
V*
But I submit to you that all
that this is desirable.
are
Is
Our
Governmental
System
Inefficient?
the
ignores
the very
problem.
People
free only while they remain
masters and their government
such
thinking
essence
remains
of
the
the
servant.
The
inge-
nuity and individual enterprise of
people can come into play only so
inefficient system of government long as they remain free. And a
ever conceived by
the mind of nation can remain strong only so
man.
They divided the Federal long as inventiveness and daring
responsibility up into three phases are nurtured in the hearts and
—legislative, executive and judi- minds of its people.
*
It is true
they deliberately chose
what in some respects is the most
cial.
Not content with this, they
This is the lesson we have
learned and it is one of which we
need to remind ourselves over and
All else was reserved to the States, .over again, else we will find our
which, in turn, were subjected to downfall through seeking'<*after,
the
same
three - way
division, strange gods which may readily
They then provided for a system be found in any direction in which
of elections to improve upon the we care to look.
:V^/v":Ky
old democratic process; that is, to
i!Wo»«-8«o
it i«
make it possible for the people to
Free Enterprise^System
It is
elect the more intelligent and rerari OI
sponsible of their members to act
We often are asked—how do you
as their servants in originating defend the Free Enterprise Syslaws and administering justice.
tern? It should need no defense,
Inefficient? In some ways, yes. particularly to those whose lives
But this was the most efficient are enriched by its bountiful
form of government ever devised fruits.
It is part of us; it is as
in one most compelling respect, much a part of our lives as the
It guaranteed and in action has air we breathe,, the water we
said that the Federal Government
may do thus and so, and no more,
preserved the liberties of men and
women.
It is responsible for the
strength, for the character, for the
attainments of this nation.
.
civil
divisions
of
government—
At this point I want to quote a
whose aid and counsel are of in- paragraph, from the writings of a
estimable value as we face the great American of our day, who
world problems now before us.
describes so well the process upon
At this point we may wejl ask which X have
tried ..briefly to
ohrselveS-another series of ques- touch—a paragraph from the little
tions.
How did our country hap- book entitled "The Key to Peace,"
of great
ability and high character—professiohals of both the military and
men
by
found
°L the God-given right of every
™an,
*}.
.? f ith
.h
freedom. It places its
t in t
People an<* P OJn'ts
way * * J:
anchor."
their
many
inspired
.
upon
enterprise inherent in every
being.
It takes cognizance
Macaulay gave
that these elected officials have at
sides
people,
formula
human
us
the role of world leadership.
did
it
to
sail and
point,
-
welP011^
of the world. Lord
World
a
the
freedom,
built the
powerful nation in the world
today.
It is a formula which
takes account of the individual
our
voice
S.
is
this
most
their
of the world.
U.
of
surged toward the
new and rapidly expanding United
States.
The sharp diversities, of
the American Revolutionary pop¬
ulation were multiplied ten thou¬
immigration
compared
.
so
certain
tugged
over
cal death—was unknown to the
group'of men who sat down to
safety, the few who have been determine how our country was
selected from among us — the to be run.
On the face of things,
many—to fight our country's bat- in their day, they must have apties
in
foreign lands which to peared as hopeless idealists to all
many of us are only names on our of the sophisticated political minds
minds,
course.
their
in
as
consider carefully
sane,
is
and
we
Nevertheless,
responsibilities
must
affairs,
Day-to-Day Dealings
Possibly some clue to the answer to such questions
to be found in the behavior of men and
women
holy
citizens should
vate
as
trustees dur-
as
lifetime.
is nothing
perspective
large majority of the in¬
those of many other
countries. But personal
corruption was creeping into pub¬
lic affairs. A
queer sort of disloyalty had, we now know,
seeped into many segments of the "people's govern¬
ment" in this
country. This disloyalty appears not to have
been bought with dollars and cents but with a
type of
intellectual appeal, one of whose canons denied and even
dividuals
causes
without
follow
to
are
act
we
American Scene which
respects has
proved more bare-faced in its plans to redistribute wealth
and income by fiat. When Roosevelt died in 1945 he (and
most of his lieutenants) were still heroes—savers of man¬
kind—to
be
effects, not
generation, but as
to our
as
ing
Deal
the Fair Deal, which in
On
it quickly developed .ay-«
namic
qualities
and
magnetic
influences that spread abroaa and
Strangely enough, no other
the world?
Whence comes the people ever copied these methods
push, the inventiveness, the viril- of government in their entirety,
ity, as applied to the whole na- although many have been struck
tion? Do we have a monopoly on with the great achievements made
the world's natural resources? possible by such a government
Are our people of a different Some, indeed, enjoy the economic
breed from all others?
fruits of free institutions without
While our land was blessed with even troubling to ask why a naa wealth of natural resources, we tion so young can carry so many
are not the richest in the world nations on its back without slackin this respect. Were this the sole ening its stride,
criterion of greatness, then RusNevertheless, people in, other
sia would have been the greatest lands must consider our system of
long ago.
Our people are de- government too clumsy and too
scended in the main from Euro- inefficient to be worthy of emuPean
stock.
The answer lies lation.
Certainly many in our
elsewhere. The genius of America own country think that we have
is the result of individual freedom grown too big and that our probunder a form of government un- lems have become too complex for
like any other in the world. For this historic system to continue to
this we are indebted to the serve us. There appears to be an
Founding Fathers of our Republic, element inherent in human nature
The science of government is which calls for a "boss man" in
not new. It has been tried in all time of trouble or in the face of
of its phases over the ages. No danger.
We look to someone to
chapter in the long, weary history tell us what to do. Of course, this
of mankind—a history punctuated "boss man" can be found in many
by oppression, misery and politi- forms. He can be a dictator, or he
power
bad
or
those which
for whom
will help us
(Then
ideas
advocate
their
only
troubling to inquire into or even to
rights and wrongs of what was going on.
Fair
could
course,
as
pies?
as
well-thought-out conviction
to
hath not—all without
the
well
as
ing them through and arriving at
a
its way,
Then
off
first, soberly and seriously, think-
covering its shortcomings by boast¬
ing of taking from him who hath and giving unto him who
consider the
this
contrary,
people incomparably
with other peoWhy
is
the
productive
of America the wonder of
are our
high
the sciences
dangerous to the long-term
are
and
utmost
observer
find
health and safety of our Republic,
On the opposite side, many of
soon
saying that a "new moral climate" was
developing in this country—and so saying, proceeded to
discard with not so much as an apology or explanation,
one after the
other, all the sacred promises made by him
and his party in the platform upon which he had been
elected and to which he had again and again and again
continued
What has made
America
strong?
What
is the
secret of this young nation: why
workers.
more
allegiance. It was at that time, too, that the
"dishonor" of repudiating the gold clause in Government
contracts was converted into
a
"smart" move by the
Rooseveltian radio voice. President Roosevelt's scuttling
of the London Economic Conference early in his first Ad- *
ministration can hardly be regarded by the dispassionate
of
to be selected for this role of
pen
world leadership?
chaftsmen, businessmen and other
became fond of
sworn
will
women
professions
Nothing,
President Roosevelt
You
attainment in
the
and
of the New Deal and a half
of the Fair Deal.
or more
and
men
mental
people of the country.
dozen years
Crisis-Challenge
To Onr Way oi Life
this to be true among people in all
walks of life, frequently embrac-
scapegoats and fasten upon them not only their own
sins, but the transgressions and the neglect of the great
.
affairs.
mundane
out
rank and file of the
makeshift.
temporary
So,
that
tendency to search
a
,
evident that
soon
was
unique American formula was no
page
pleasures they have undertaken
they have no time for such
or
in political circles (that is, chiefly, in
what had been the
from first
The World
New Era and the abuses which thrived under it came to
arose
"It
M a n i o n of
University:
Dame
Notre
which
disturbing aspect of the matter was the apparent lack of
general public interest in the matter. There followed a
decade or so of governmental rectitude, but a period dur¬
ing which a good many things happened in the business
world of which there is little disposition to boast. When,
after the crash in 1929, some of the unsoundness of the
light, there
Clarence
Dean
by
new
was at the time often excused as a
from World War I.
To us the more
of back-wash
Thursday, August 9, 1951
.
steadily from coast to coast.''
It
Harding.
.
ican
clarifying setting for what we have in mind. The older
generation will clearly recall what happened in the Fed¬
eral Government under the "back-to-normalcy" regime of
President
<
drink, the food we eat, the God
we
worship.
The so-called Free
Enterprise System is distinctly an
American institution, like baseball or hot dogs, or freedom guaranteed by a constitution.
It is
America in every walk of life—*
the right to change jobs, the right
to pwn property-, the right tp^go
into business, "the right to go out
of business; even the right to be
Volume 174
Number 5036
.
.
The Commercial and Financial
.
Chronicle
(529)
foolish
harm
to
if
j.
any
it
doesn't
else.
one
Enterprise System is
Our
bring
The
restrict the
Free
between
This
difference, of
privilege
They knew
is
why
pure and
have
we
If
governments.
holy
all
tions
laws
the Ten Commandments to
guide
prise
the
Individual
or
detriment
of
we
These
Enter¬
have
brought
the
to
us
leadership,
'
But
have
we
point
not
completely
V
simply
their
unscathed,
there
freedoms
was
people
pean
that
real division of our
no
into
new¬
such
was
classes, in the Euro¬
for many a year.
In
sense,
this situation undoubtedly
lay one
of our
greatest strengths.
But
finally the land
pied and it
look
of
for
occu¬
became
necessary to
frontiers on behalf
new
small
a
lation
largely
was
element
which,
in
must be forever
on
frontiers
there,
were
our
find
to
popu¬
happiness,
the
The
move.
of
course,
but it
was hard to
recognize them.
Also, some of us became quite
lazy
and
inattentive
over
the
years;
not always tried
his best contribu¬
make
to
each
have
we
tion.'
Hardship—even of
rary
nature—has become
tempo¬
a
thing
a
cannot abide.
we
terioration
has
our
right
to
action that
of
dom
as
us.
we
of
being where
such
live in
free¬
We
if
Withdrawn
it
suddenly
were
would
precious it is.
know
we
If it
how
possible
were
gradually the amount of
in the air
oxygen
first know what
might not at
we
was
wrong—only
that we would begin to feel lazy,
perhaps enervated, without know¬
ing the cause.
So with freedom.
In
hour of trial
our
find
we
it
easy to turn to the Federal Gov¬
ernment with our personal prob¬
lems.
To make
effective"
-
voices
our
have
we
grouped
more
our¬
should
if
way,
one
or
and
pressure
a
adopted
the
on
there would be
Under one
no
guise
intimate
citizens,
such
or
safeguard.
another, under
one
giving
us
what
we
In
the
face
reinforcing
of
this
method
of
demands, it is not
our
at all
Government; the dole
used
to
attract
votes;
the "in" party would remain
"in";
the resulting havoc would become
tience
they
of
are
strong, able
often
a
not
themselves
party to such outrageous
conduct.
will
Such
fiber that
men.
such
submit
cannot
and be
of
Men of this type simply
the arena of idle
enter
and
high offices.
this happens
very
.To
we
keystone
the
extent
gain
that
hack away at the
of
our
republican
form of government
which has for
its ideal the selection of the
ablest
and most responsible
among us for
these all-important
posts.:
'
■;
;
We have-, been prying at the
other side of the
.
keystone
as
well,
safety
had
the
oc¬
seek
heroes'
advocating
the
direct
lives'
mantles
controls
fortunes
and
by
over
of
the
people for the purpose of meeting
the emergency.
One
of
the
people held
which
been
predi¬
pened and
side
prying at the other
keystone.
We have
are
the
of
actually hap¬
turned away from the basic prin¬
ciples our forefathers adopted for
our
just led
early
of
control.
they
could
this
up
of
causes
bring
right;
our
difficulty. Through
in
Congress
the
lawful
to hold the
Then
dollar
steps
recommended
leaders and it became un¬
for the individual citizen
our
coveted metal.
the
gold
content
reduced
was
to
of
lay
guaranteed that eventu¬
to
generate rising prices. It
to be of
manageable propor¬
tions—called reflation. The
people
was
needs;
the
Federal
Govern¬
Ways
found to
were
feed
need for
was
not bold
take
But
more.
through taxes all that
spent.
We
resorted
financing and created
by
Congress
enough in that day to
placing
the
to
deficit
new
money
substantial
a
resulting
a
strong, solid Federal Government.
They envisioned an overall rate of
as
part
Government
maximum.
a
and
the
Federal
Reserve
was
in
our
experience, it
became possible, legally, for gov¬
to
take away
the
place
—
this
of
citizens
income
in
Robin
of
sort
a
at varying
income
other
Hood
operation.
Clipping the People's Money
Of
eral
course
the
ability of a Fed¬
bureaucracy to feed upon the
people and eventually to control
their
actions
depends
first
on
some
to
way
the
get
money.
be
given away.
At least
we
can
al¬
thought this to be true. But
actually this is not true in the
that money must be earned
collected in taxes.
Coin-clip¬
sense
or
ping is
we
old
as
proceeded
new-found
as
upon
taxes
cient to maintain
at
which
more
we
civilization.
our
desired
a
pened:
"; There '
trouble in
modern
So
version
we
of
Here is what hap¬
> /"
time of
deep
country—economic
came ; a
our
trouble—a local touch of
wide
travel—
to
money must be had.
to
the
suffi¬
the speed
at
us
way
not
were
As
malady
stalks 'in' the
such
wake
a
world¬
slow
increase the price of wheat when
we have more than we
need; it is
higher level
Browder
to raise the price of auto¬
mobiles when most
people already
have one. This is what our Gov¬
ernmental
o
f f i
c
i
a
1
s
were
against in administering the
in
pro¬
in
actions
our
zens
which v has
state
of
affairs
as
citi-
this
to
There
are
many
have
There
in
their
efforts
We
all
to
the
know
is
of
how
*
bad for
table
when
people; in
virtues
best for
and
our
are
our
luxuries
are
afford
such
of
courage. ;
in a time
met
Again we
decisions.
great
be
prudent
this
aus¬
otherwise,
the
status, with recommendations
,actiqn?
I
advocate
■'
world needs
J
,,
less
to
.
leadership
has rarely
price-
Probably the
could bring into
we
this troubled situation is
selves
have
We
more
money.
greatest thing
united
a
our
give that is
than
such
,
now, ? as
leadership
been ' needed
before.
much
.
at
governmental
again to as-great minds among
countrymen for a study of
i- The
friends
land
our
can
fact,
passed.
with
not
under
move.
a
and
it
or
for
it
people,
strong,
them-
a
governing
basis of sound, proven
principles. With all well at home,
largely justified, because
We
faced
our
neighbors. In this desire
people
have
semble
under¬
our
the
a blue¬
future. Almost two
our
pices
are a
families,
In
and
yes,
centuries
time,
very
our
mistake.
print for
are
land of plenty,
can
reach their
greatest flower. We want the
such
judgment. We
bureaucracy,
forefathers
Would
living is
chari¬
easy
Americans
us.
a
which he
upon
pass
disgrace in acknowl¬
no
a
Our
ourselves, not to
friends, that there
times
is
integrity,
to persuade
mention our
are
in¬
representatives
of great trouble and drew
us.
difficult
point
govern¬
most
acknowledgment has certain
merits—the merit of humility, of
ineffective
bring
rest
our
legislation
edging
understood
singularly
of
of
the
even
permitting
these
conditions
to
arise, let us acknowledge them.
sition to socialism and we
have
devoted far too little time
to their
anaylsis. .And
those
wise
ones
among us who
have been
centralization
,
complex
this tran¬
in
reas¬
func¬
management of which is too great
a
task for any human mind.
If we have made
mistakes in
develop, only
involved
years.
a
governmental
have reached a
is required to
have created
weakness and lack of understand¬
questions
is
now
of
where
of
ume
'
permitted
need
to
have
Congress find it physically
impossible even to read the vol¬
intended vi-
no
our
ex¬
throughout
history. I venture
we
dustrious
to think that he
his mission well.
has^ been
mankind
in the
its nationali¬
course
ciousness
principles
collective
-these
We
ment
America
we
never
intended
accomplish anything like this.
to
There
in
up
were
end.
About this time we had a visitor
from
England. His
name
was
Keynes and he met the heads of
our
government.
they
were
too
He
told
them
modest—they did
enough and they
not create
money
did not spend
enough. He intro¬
duced
them
to
a
and
so
we
many
on
a
better
can
face
foreign
a
large
a
themselves, to betray
It must
us.
Today
faced
of
in
not
relation
goods produced
to
the
but
needed,
amount
of
according to
the needs of the occasion. In other
words,
we
the
upon
wouldn't need
vast
and
to
wait
complicated
machinery of modern production
—-
we
would
wand and
need
perhaps
two.
or
;
*
a
a
magic
forces abroad in the world—
Keynes theories.
But
still
it
hard to find ways to spend the
generally money. Then came World War
II,
of a world, with all of its
was
disrupting influ¬
ences.
tic
From
this
point
on
we
threw away the book of rules and
now the
Federal Government is
first
the
and
are dependent upon our
strength
to save them from a life of
the
In
own
slavery.
we
the
face
these
ill-afford
can
which
course
and
of
weakness.
In
conditions
follow
to
leads
Africa
with
trial
a
I
needs
and
cannot
their
well.
as
look
after
provide
resources
The
can
be
As
a
lux¬
service
devoted
ample,
I
a
political
should deal in
principles. For ex¬
think we have over¬
come
from
If
abroad.
de¬
must our¬
we
nation of freemen
through
all
time,
we
or
must
die
by
Joins Hunter, Prugh
DAYTON, Ohio—Robert M.Pool
is
with
Hunter,
Davidson,
Inc.,
Building.
Ball
Prugh,
&
Winters Bank
-
.
,
>
With A. C. Allyn & Co.
fundamental principle in
economy
years.
(Special to The Financial Chronicle)
care
looked
thousand
to
agency
we
or
their
some
same
Ohio
selves be its author and finisher,
;
uries
and
to
to
We have
a
the
the Blue Ridge
on
struction be our lot
unfortunates
us.
in mixing two
(Special to The • Financial Chronicle)
;
ingredients that cannot safely be
MILWAUKEE/Wisl — Earl J.
mixed—the guardianship of our
Beck
is. with A. C. Allyn and
money
and the guardianship of
our people. The one is the
Inc., .First Wisconsin
proper Company,
~
function
of
the
Federal
'
if it ever, reach us it
spring up amongst us; it
suicide."
among
all
(our
their
answer,
must
live
means
in
Asia,
with
earth
"At what point then is the ap¬
proach of danger to be expected?
need
to be oblivious to the needs of
the
the
of
Europe,
the
from
track
a
ocean
Never!
military
a
Bonaparte for a
could not by force
drink
a
make
in
of
of
excepted)
take
judgment
my
blow?
a
.combined,
confusion commander,
to
at
us
armies
treasure
chest,
any
expect some transatlan¬
we
crush
All
people
weary
'
,
military giant to step the
and
shores, mil¬
fundamental
We adopted
some, if not all, of
the
Shall
—
downfall. Beyond our
lions of good but
'
"At what point shall we expect
specifically, Communism
that
are
striving to bring about our
national trends
Socialism Is Here*
the
,
ica, historical and potential. There
are
regardless of the
through which the help
printing press is channeled. In
reconsidering our
only
of
the approach of danger? By what
means shall we
fortify against it?
new
as
crisis
by
people
our
magnitude:
a
money must be created
another
said
As
overcome.
find
ourselves
in
need of the full
strength of Amer¬
we
concept— the time has come
for us to re¬
"Compensatory Econ¬ consider our course and to
strive
omy."
Under
this
concept
we
mightily
to
reawaken
and
would forget all of our old ideas
strengthen that indomitable will
about checks and balances, power
which,
coupled
with
national
of the people over
government,
and such outmoded beliefs. Gov¬ character, must be characteristic
of a nation that intends to remain
ernment must be
all-powerful; the great.
intimate welfare of the
people
Contrary to what many say,
must no longer be
ignored; the this does not mean that we
that
be
Lincoln, in whose day
What We Must Do
new
as
cataclysm like World War I. As
usual, following that-war there
was
a
period of great optimism
tions.
industries, which
out
of
that
down
the
recorded
What
1939-1949.
in the U. S. A."
laid
upon
signment
seems
carried
Of
hard
at their wits'
time
.
concentration of the
guiding
reins of national
economy in gov¬
ernmental hands is
probably on a
has
they
degree of enemy. And to whatever extent
we may have
in taking hold. America is a
developed weakness
most folly as well. But perhaps we are
productive country. It is hard to permitting these traits, admirable at home, this yet can be Overcomes
Even so, the price rise
first
hands
tial
procedures in keep¬
changing environment.
principles
changed little, if any, in 176
America; the actual, substan¬
productive.
„
"Managed Economy." They
and
of
bonds
They
made a strong case and secured
approval over the objection of
much wise counsel.
So, for the
rates
could
in
our
a
perience
all
stage not yet reached
money
into the hands of citizens.
People
took the money and soon there
But
based
Browder,
aspects, has
farther
stepped in to fill these needs. standing to
ment
ing with
capitalism, in substance,
in formal
zation of certain
is a formal
our
Advocates said this change was
ernment
basis
a
details of
than
Great Britain under the
Labor.
in
Actually ing.
reflation.
day. They
not pretend to.
They left us
ample opportunity to change the
leaped for¬
high point in
new
Government, despite
banks
of
necessary to the maintenance of
tax
the
ally the housewife's dollar would
buy less. Our government under¬
took
a
not
did
thinks about
Earl
Founding Fathers could
the changes which ^ have
taken place in our
country and in
the world since their
say
to
gressed
of the
one
The
foresee
of
capitalism
State
.
in
a
that gold-re¬
.
Bank,
One
Amendment to .the Constitu-r
tion—the Sixteenth Amendment.
2%
quickly
.
representatives
took
by
one man
named
leader
"State
the
another.
man
if not
people
this
last year:
had to do with methods
an
or
The
in
the proper function of the
respec¬
tive states.
the Communist
Party in America. Browder wrote
we
taxation.It took the form of
1
it—a
in the portfolios of the
commercial
to
ones
those whom they
office was a
Federal
deemable currency was
be
they were quite mild.
All had
apparently worthy purposes. One
our
halt to any governmental
schemes
of which
they did not approve. We
were told that it was
necessary to
We lost faith in ourselves.
There
controls
soundness of the
currency. In this
was
steps involved in our
turning away.
At first
here is what
ward
exchange currency for gold
they had reason to doubt the
protection.
How
did
this
happen?
We became frightened.
many
great
over
to
monetary
give
label
29
ment; the other, to the extent that
guardianship may be necessary, is
nation
Many people deny this: some
high up in government circles. But
our
could
had
These things have
fashionable
America in the decade
so-called
would
a
former
of the
some
upon
always
move
coin-clipping.
men
soon
cated.
this
the cry that Individ¬
ual Initiative has failed
and men
opponents
*
violate
principles
for
raise
resorted
small
past and
very
would
irresponsible promises in
order to become elected to
public
office.
Thus, strong men are often
defeated in favor of their weaker
and
what
was
Today
semi-socialistic
country. Even the most ardent
socialists in action
appear to have
a
reluctance to adopt the
label.
But socialism is
here, to a greater
degree than many of us realize.
They de¬
governmental help to
supply; currency depreciation
would
result;
trouble
makers
ways
men
the
mixed up with the nation's
money
well.
limit to the pa*
men
teachings of
we
be
Money must be had before it
a
us
the Federal
surprising that deterioration
is taking place in government as
There is
govern¬
mind at that time. This led
to throw away the
our
into
organized
interests
petition and cajole and even
attempt to intimidate our elected
into
and
a
same
good name or another, the
citizen would get his dole from
would
not
minds.
individual
way
other
selves
officials
real
their
are
although we avoid that name like
the plague. As
yet, "socialist" is
efficiency.
required. I think the ma¬
jority of our people were of this
if
fight
Government
step into this
relationship w i t h the
who
want.'
strict
and
casion
suc¬
policies, they would
we
will recall, the trouble
that
elected
governments
to
were
breathe the air around
Only
to reduce
liberty of
lost all conception
exist.
not
among
accustomed to
so
personal
we
state
a
does
that de¬
I,
occurred
We became
us.
do
as
the
that
activities
go broke and have to
process of
Among Us
realize,
changed
way back to sanity—and this
were
Deterioration Has Occurred
You
to
«
happened.- If,
hand, the Federal
for
very
deter¬
people
has
this,
have not always met our
prob¬
lems fairly and
squarely and on a
basis of principle.
The electric effect of these
this
unwise fiscal
of
we
found
In
State
cumbed
'1;
reached
as you
cided
of
economy
But,
history
was
ordinary
.
,f
•
it
So,
the
their
dozen
the problems such a situation in¬
volves.
that
platform
a
was
Government must, of
States.
States.
They
all
of
the godfather of
everyone.
eco¬
campaigned on the issues of the
day and the Democratic Party won
welfare through the medium
of the governments of the
various
situation
with
the
control
concepts,
world
observation
the
day came to
political parties
Both
up.
in
The
and
bors in the world, have guided our
/
they had in mind also
sober
tne
They knew
from
sense:
ag¬
bureaucracy at
and
mined
American
nation from the beginning.
to
over-expansion
nomic
mental
emer¬
this
in
to
our
elementary in
thinking, but for¬
eign to the thinking of our neigh¬
of
some
fancied,
and
on
would
necessity, be given the sovereign
authority over the nation's money
—an
authority which does not rest
neighbors.
Only in this way may men ever
hope to govern themselves.
our
(liter¬
means
if'granted,
or
the
the Federal
use
Initiative
to
means
concentra¬
of the people.
expense
we, unfortunately, were
not
make
that way.
So there
must be some enforceable rules
which may be invoked if
our instincts toward
Free
real
grandize
But
us.
and
power
gency,
and
were
would need only
we
such
inevitably be used in
license.
men
of
that
ally—money),
course,
and
and the
Government to in¬
vade the daily lives of the
people.
buttressed by the Bill of Rights.
a
careful
were
power
of tne Federal
an American
privilege, retained by the people
through the Constitution, further
There is
forefathers
gover-
National
Bank
Building.
•
Chronicle
The Commercial and Financial
Thursday, August 9, 1951
.
..
(530)
30
aware
anything about
United Paramount—I haven't
watched it). Close on its heels
is Loews, then comes Warner
and 20th Fox. I'm not going
can't
I
Markets
Whyte
Says—
tained
If
you
early part of last week, the
took another breath,
market
puffed—and went
huffed and
right up again, thereby con¬
founding most of its critics
who still don't like how the
points up arguments.
only with mar¬
that
is
*
❖
a
and New¬
in
for common stocks,
have
been
looked
by speculators, that their market
value,
although advancing, has
failed to express the substantial
that has occurred since
earnings. This
recovery
in
corporate
revealed
by
situation
for the
comparative-yield
has
stocks.
been fortunate
conservative investor, be¬
he can obtain
an income return on his security
list that approaches adequacy is
to hold a
substantial proportion
of his list in common stocks of
cause
between
dustries
and
dustries.
In
in
is
list
of
especially
common-
I
diversification
for inclusion
a
economic fac¬
gold mining and
respectively, are
divergent as to require separa¬
in
tentative list of
a
securities
those
stocks
can
obtained by the selection
best be
turn,
mining,
copper
and
the
Requisite
distinct differ¬
the extractive in¬
the processing in¬
affecting
tors
so
with such suspicion, at least
upon
The
Thompson Products
issues
studies between bonds and
*
couple of other
market's parting its hair, or stocks that are looking quite
perky.
Among them are
something.
*
V
1929-1932 collapse
market prices
these
ket action.
are
advisable,
stock holdings.
of the very
cause
ence
Since the
1932
ijs
considerable
a
Stocks
is
*
at
only
sacrifice.
I'm concerned
There
also
Perspective for Investors
want that sort of infor¬
mation, take a look at their
minor tumble the
balance sheets, or whatever it
a
fication within these categories is
from page 10
needed
time telling you
wonderful they are.
how
Continued
say
to waste your
By WALTER WHYTE:
After
I like best
one
Pictures (sorry,
is Paramount
Tomorrow's
Walter
The
of.
that
show
favorable trend of earnings.
will
list
much
be
hensive than the
accepted.
more
one
This
|
compre¬
to be finally
The list can be screened
stocks of companies
eliminate
to
The whose earnings are threatened by
to ascertainable economic or other
to developments. In cases where the
analyzing stocks to be included yield of a stock is substantially
in a balanced investment list. The
higher than that of others in the
approach can be made by major same field, it is wise to examine
group followed by subgroup, then its
prospects with special care.
by industry, and finally by the Bargains are suspect because the
analysis.
general
for
tion
foregoing example is presented
illustrate a
logical approach
individual
company
its
and
se¬
the
sents
vestors
Attitude Toward Stocks
The
conservative investor buys
that is,
stocks with his eyes open;
of the market repre¬
opinion of many in¬
judgment
curities.
the only way
issues
The
then
can
is
and
on
be
not
to be
ignored.
list
tentative
the
examined
elimi¬
to
nate the least favorably situated
not wavering. He
that are in the same industry Or
the nation's leading corporations.
watches his step, but yet he takes
type of business. In the case of
Although the speculative in¬ it once he has made up his mind
railroad or public utility holdings,
Some
terest in the stock market that led that the ground is firm.
diversification
by
..geographical
Sic
Sic
sis
I
who
have
suffered
to the unhealthy pyramiding of individuals
hope I could come up with
location is desirable. This process
margin accounts in the late 1920's losses from ill-advised stock pur¬ can well be
some
ideas of either bull or
If you're still looking for
applied to an invest¬
has not occurred again, there has chases ever after select issues to
or's list at regular intervals. The
bear market, and pass on my
an
increasing
interest in buy but always wait for the price
averages, here's an off-the- been
scrutiny may reveal other weak¬
conclusions to a readership
cuff opinion. Industrials are common stocks by investors since to be "right." In consequence, the nesses that had not
previously
that was undoubtedly waiting
about 265 now. I think they'll 1932. This has brought abouV a years come and go, and the pur¬ come to the investor's attention.
chases are never made.
These*
wider
distribution
of
commonfor it with bated breath. Now,
go up to about
stock holdings purchased in small potential
investors become im¬
Liquidity
having finished what I laugh¬ they call it a day. You can lots and, to a growing extent, by mobilized like Browning's pro¬
The common-stock section of an
ingly call my researches, I can take it from here.
investors
outside
the
financial: tagonist in "The Statue and The
investor's holdings
may
be re¬
centers. The gradual accumula¬ Bust." At the other extreme are
advise you not to hold your
[The views expressed in this tion has been accomplished with¬ those who constantly jump in and garded as a living entity in which
breath any longer.
change is a normal condition/ It
article do not necessarily at any
out driving prices up to absurd out of the market. Zc
must have the flexibility that can
According to the classic in¬ time coincide with those of the
heights because its motivation
be assured only when individual
Two
in
One
terpretation if the industrials Chronicle. They are presented as has largely arisen from the desire
isues have a ready market. Stocks
those of the author only.]
Most investors are.mildly schiz¬
to acquire
profitable property
pass their May 3 high of
actively traded in on the New
rather than in the fond hope of oid. They each have two personal¬
and the rails exceed their 90
York
Stock
Exchange have the
making a quick profit. If this ities that might be called hope and
best rating for marketability, and,
fear but are labeled bull and bear
figure, then everything's rosy
process continues, it should con¬
Both look
Having some extra time on port Industries.
like about five points more
my hands last weekend I went
over the Dow averages in the from present levels.
he is wary, but
272-273 ^efore
263
God's in His heaven
right with the world.
again.
and all's
*
*
*
:■
Dewey Wright Joins
Lentz, Newton Co.
SAN ANTONIO,
Texas—Dewey
associated with
Lentz, Newton & Co., Alamo Na¬
jnove up then everything will tional Building. He was formerly
be confused. Because, under Assistant Trust Officer of the
the theory, the recent decline Alamo National Bank of San
only the industrials
Should
unim¬
considered
be
would
Wright is now
E.
Antonio.
the same
could be Neb.-!owa
further rise.
portant, though at
(nv. Bankers
time, no significance
given any
*
To Hold Annual
v
like
sound
this
all
Does
*
*
jabberwocky? If it does you're
after going
over
all the theories I've
learned and have had ham¬
not
For
alone.
still find that
of averages
that increase
(or decrease)
one's bankroll—it's issues.
mered into me, I
it isn't the action
So
now
(Special to The Financial
LONG BEACH,
back to the bread
and butter stuff—issues.
Some
I wrote here I
thought highly of the amuse¬
ment shares. Up to date they
haven't done anything to
cheer about.
But here and
there there's a little rumbling
of life that keen traders are
weeks
Chairman of the frolic.
ago
Kinds of Stocks
Douglas Hammond Opens
Calif.—Douglas
opened offices
Lakewood Boulevard to
A.
Hammond
at
5327
engage
Chronicle)
has
in the securities business.
has
joined
Merritt & Com¬
others.
the
lon and Alice Laskelle have
the staff of King
pany,
Pacific Coast
•
Atl.
on
Schwabacher & Co.
Members
New
Stock
Exchange
New
York
York
Curb Exchange (Associate)
Stock Exchange
San
Francisco
Chicago Board of Trade
14 Wall Street
COrtlandt 7-4150
New York 5, N. Y.
Inc.
San
Francisco—Santa
Offices
Barbara
Monterey—Oakland—Sacramento
Fresno—Santa Rosa
would
be
the investor to
"satisfactory adjust¬
to reality" ihaf£ is needed in
ment
his
undertaking,
bedause
CALL
OPTIONS
Line.@67
Nickel...
•
@35% Nov.
275.00
So. Pacific ...@63
Sep. 21 425.00
Studebaker \ .@25% Nov. 2 275.00
111. Central ...@58% Oct.
5 387.50
U. S. Steel.. .@41% 6 mos.
400.00
Republic Steel @39%
Mo.Kan.Tex.pf.@54
J. I. Case... .@66%
Sperry Corp.. .@29%
Int'l Tel & Tel @15%
20th Cent.-Fox @19%
Hall Printing
@17%
Philco Corp.. .@23%
.
5
Oct. 11
Oct. 1
5
mos.
5 mos.
Dec. 17
Oct. 16
Nov. 14
Sep. 17
375.00
587.50
687.50
412.50
237.50
225.00
200.00
250.00
Subject to prior sale or price change
Explanatory pamphlet on
request
THOMAS, HAAB & BOTTS
Members Put & Calls Brokers & Dealers
Association, Inc.
50
Broadway, N. Y. 4, Tel. BO 9-8470
the practice
tion stocks of the
and
are
some
dollars).
ent
Sep. 27$550.00
Yet,
companies (not to men¬
American Tele¬
surance
phone
Per 100 Shares Plus Tax
Cst
Int'l
Teletype NY 1-928
Private Wires to Principal
validity,
they each posess special charac¬
teristics that set them apart from
at
Orders Executed
classes, in¬
railroads, and utilities,
certain
a
random,
at
help
will
volved
stocks into three major
dustrials,
results
1
-
,
funds that have
the
test
of
turns and
capital position over an
extended
period of years.
On Margin
Diversification
extrem^variations in-
Such
stock
prices as
satisfactorily met
income re¬
favorable
throne .that
oc¬
Portia
became
famous
because
of
Venice
had
Merchant
the
his
is
up
in
curred during tlf# 1921-1932 pe¬ margin account all tied
an
example of oversimplification
riod are unlikelVStq; be encoun¬ shipping.
Spreading the risk
and excludes such important
With King Merritt
tered more thadfonce within an among several argosies was not
groups of corporate stock issues
investor's
BENECIA, Calif.—Glen I. Dil¬ as those made
lifetime^; .The lessons enough, since they came in after
by banks and in¬
SPECIAL
Pacific Coast Exchanges
the securities
invest¬ such as some of the railroad and
satisfac-" other companies that are selling
tory if liquidation were not forced at depressed prices because of
during the relatively few months doubt as to the continuation of
when prices werfe in; their lowest present
dividend disbursements.
ranges. An understanding of the In fact, unlisted issues are in¬
reasonable probability here in¬ cluded in many trustee-managed
chosen
riod,
ment
of achieve the
division
conventional
The
which
Securities
include
these
the stock market and to
OMAHA, Neb.—The NebraskaIowa
Investment Bankers
will tion of issues for purchase or re¬
hold their annual frolic at the tention out of the great number
Omaha
Country
Club, Omaha, available, the wide variety of
Neb. A cocktail will precede the types of enterprises, and the read¬
event on Sept. 19 at the Black- ily
observable
fluctuations
in
stone Hotel. Harry H. Greenway, market prices all present prob¬
Central
Republic
Company, is lems for consideration;
t*
*
*
Outing
since
the stability of by the financial fraternity. The
of
companies that have shown
the sane conservative investor endeavors to
superior ability to grow and op¬
appraisal of market values. Ulti¬ discipline such characteristics by erate
successfully,
a
selection
mately, it may even constitute a cultivating a poise that does not from these will
probably comprise
barrier against the poltical on- rejoice overmuch when his pet
the most important portion of the
slaught constantly aimed at se¬ stock rises five points in a day's
common-stock list.
trading,
nor
become
panicky,
curity holders.
A higher average yield may be
when it falls five points in a re¬
The
attention
that must be
actionary market. (Such a drop obtained from unlisted stocks that
given to the quality of stocks and
when other issues, are advancing possess strong financial position,
their market behavior comprises
earnings record, and
must be looked into without de¬ consistent
a large share of the time given to
These
He realizes that intermedi¬ reasonable marketability.
the study of an investment pro¬ lay.)
ate movements in the stock mar-, may be included in a well-diversi¬
gram. In many instances, common
fied
list
in
preference to attempt¬
ket may be reflected in variations
stocks constitute the most impor¬
of as much as 20% or more in the ing to increase average portfolio
tant segment of an investor's hold¬
Dow-Jones Industrial Average in yield
through the purchase of
ings; and, in any case, the selec¬
one year.
Yet in a* ten-year pe¬ more speculative listed stocks,
tribute greatly to
four
and
in
a
Although
stocks
Company,
Telegraph
valued
in
these
the market
half
the
billion
learned
that
groups
vary
radically in present and prospec¬
tive worth, the market pattern of
the three differs enough to make
so
.viyid in
have 'to
be
memory
generally
forgotten
befor^lzidulgence in
speculative excessesTas extensive
as those of the late 1920's can ob¬
tain
compon¬
are
they
Yet
time
level
necessary
popular
circumstances; may
support.
at
any
thegeneral market
subject to drastic decline,
make
his loans had
a
in
been called.
Many
modern Bassanio was wiped out
Wall
Street
in
1929
when
no
quality of mercy dropped from
heaven, and no legal quibble came
to his aid.
Since then, investors
have
not
been
tempted
to
stray
speculative byways to any
great extent, and loans on secu¬
into
and the investor must arrange his rities have not risen to a danger¬
program with this possibility in ous level. The reason for this has
general distinction useful as
mind.
Aside from a knowledge sometimes been attributed to the
a starting point in stock analysis.
of t the
imminence
of disaster, action of the Board of Governors
However, it should be kept in
which many more people subse¬ of the Federal Reserve System in
mind that, while there are enough
claimed than actually imposing restrictions on such
characteristics in common within quently
loans at the behest of the United
the railroad
and
public utility possessed in 1929, .the two safe¬
guards that were most effective States Treasury, but it is doubt¬
groups to give them homogeneity,
in
preserving investment funds ful that the restrictions were an
the individual stocks in the indus¬
through
the period of decline important factor: If people want
trial group
vary
so
greatly in
were
diversification and avoid¬ to gamble, they can usually find
character as to make the grouping
the credit for it in spite of any
ance of debt.
of only the most general value.
Diversification applied to the restrictions that officialdom can
To remedy this, security analysts
conservative
investor's
general impose. The distinction is impor¬
arrange the industrial issues into
tant, because the position of the
subgroups having enough charac¬ program is provided by balance
stock market is probably health¬
types,
teristics in common that general among major investment
ier if the volume of borrowing on
economic factors will affect the such as life insurance, annuities,
stocks has been kept down by a
bonds,
real
estate,
and
stocks,
inindividual
companies
similarly.
accordance with the individual's high coefficient of caution on the
Thus, the mining stocks may be
part of the stock-buying pubiic
taken as a major subgroup be¬ objectives and resources. Diversi¬
the
Volume 174
Number 5036
.*.
The Commercial and Financial Chronicle
.
(#31)
ralher than by Government-inspired mandatory restraint. However, brokers' loans are of concern
to
only
as
the
conservative
laid
is
.
by the government's proindividual income tax.
Within a single generation, it has
such
towered
ness
gressive
investor
from
up
tax to
a
a
con-
they may affect the mar- tiscation as far as the well-to-do
ket level, since he is too well in- are
concerned.
The concept of
formed of the hazards involved regarding returns on substantial
to
maintain
a
margin account savings, that is, capital accumulahimself.
tions, as "unearned income" and
Your
Dollar's
Much
has
writterr
Talked
been
about
therefore reprehensible, has taken
Worth
•
inflation
and
century
short
period, the
world war,
a
depression, another world
can
usually find time
ments,
the
is
process
ing, and such persons' funds
either
way
managed
in
are
managed under professional direction. In the case of
or
are
dea
y
g
The only way left open through
which wealth can be accumulated
war,
all
that
war
investment
™^t?«pWc
s.
it would in others.
as
concerned
is
Dur-
(some
states
make
further inroads on this). Consequently,
conservative
investors
having considerable capital are
into being forced to purchase issues of
ing this period, the conservative
investor did not fare too badly.
In 1918, he probably wished that
he
had
put
all
his
Submarine Boat
money
its
equivalent^
of his
strong-mindedness in keeping his
but
n
I,,*
1921
or
he
millionaires.
felt
a
they
are
conscientious
as
in the
as
in
from
his securi-
increased
not
S lw"'
much
so
his
as
exposes is not gieat.
but the gap from.sis
level,
The
conservative
investor
theL
se bsLer?emiires
ss
s requi
Hon
of
to
of
more
es^more
^ha?t Iss SS
Quired
oSr
othe
to
Of
has
professional
wander
that
off
the
someone
what
is
path
r
to
believe
him
The
just
chances
investment
man-
how
have
enabled
low,
but
sell
It
easy
is
investors
high
to
past
in
to
failed tor some
distress
by
foreknowledge,
fore-
he
on
the
basis
and
leckus^reports
oetdube
show
markets
•
these
figures do not
which
to
thef" accounts
to
measure
oeoole
will
in
a
similar
manner
as
and that
economic
for
power
the
securities
financial
sections
War
1
'
jviost
people
retire into
h
an
a.
the
fact
that
afford
1 ,
to
{
disastrous effect
on
Perspective
tion
of
or
disastrous
a
The
perspective
actuarial
basis,
the
individual's
chance of survival has improved,
ai*b°ngh there is no guarantee
that it will continue to do so On
right, and the reader is left to the whole, it would seem that
the
choice
his
make
prognosis.
sides
appear
•is safer
will
If
to
be
•than
the
on
^hidmg
the POssibUity of another war, is to maintain a con-
that
assume
raise
prices
the
have
along
gone
are
labor,
be to do
in
so
cases
popular
are
'
Here Is What Happens
v
with;
Fund
u
Management
strong '
N? matter how well conceived
general an investment program may be,
'level of common-stock prices over l}
cann?t be abandoned to fend
the longer term.
>
Jtself. Someone must give it
..f;
informed attention. This task can
force
for
a
the
-
has
And I say
to you.
(who
men
minds
of
run
must
and
pro-
Why is it that
who should?
extremely brief
lem
clearly
y
requisite
for
might
be
summary,
and
to
that
on
as
in
So
date.
done by
was
confidence
him.
to
In
do
as
a
trades
at
he
5% wasnt
list
retail
income
of
'
Struthers
m0nths ended May 31,
jngs 0f $2.91
ggc
of
djvidends
annum
7%
'the
last
at
furnish
The
earn-
a
of
m-
.
kneadjng
machines
hv-
cement,
pulp
and
paper,
,
r r
total
I
yvnen
LOS
of
amount
0.
A
ANGELES,
has
been
staff of Marache
South
deto
_.
Cal.—Earl
added
Sims &
F.
tic
to
Co., 63
Spring Street,
With Harri* ITnham &
W'SLSLP
.,Tri?T
rc
r
,
LOS ANGELES, Cal.- Jared
£lke" has become afflliated w
that
sfx7h S^eVt
'
~
C
forrr^r'-
He w°as
sixth Street.
He was forme...
wlth Dempsey-Tegeler & Co. a...
asked
1
,
Spencer
askea
M
and
white
markup
just
I^ai! Z S busS
trvine
for
onG
to
fret
an
in
answer
to
the
that
'
.
geles stock Exchange.
He was
formerly with Cantor, Fitzgerald
& Co. and Daniel Reeves & Co.
.
Whv thp Mvsterv9
■
wny ine luysiery.
Do you believe that
ness
that is
as
can
tbe
as
'LOS ANGELES, Cal. —Jath
Newman bas joined the staff (
Morgan & Co., 634 South Sprim
Street, members of the Los An-
has been
vearsV'
busi-
any
Wickenden With Morffar
essentially creative
(special to the financial chronicle)
securities
become healthy if it
is
ch,on.cl'e)
,speci.i to x„.
6t
timP-'PVervhndv
wa<.tp
With Morgan & Co
could
he
industry must
mix- be, if it is to grow and prosper,)
makes
heayp dity
boilerSj
of
the
Marache Sims Adds
just an
"Whv
$1.40
return
1951
(Special to the financial chronicle)
5%
over
was
When
black
much
Quarterly
company
forging
and
equivocal
how
corresponding
rate
*
an
amounted to
two
were
at
rule; it
Wells
1951,
year
the
1951
h.m why he didnH insistfta^he Morgan & Co.
share compared
per
in
1
con'solidatpr
happened
informed,
was
a
mierpreiauon.
^
Nov
bentures outstanding amounted
$790 235 000
When he requested to know
if the NASD had a rule that for-
internretation "
aimost
2 35%
l
dealer
enough to tell
what
his
you
one
sales.
the in- bid
it
see
,
iod
due
$56 495 000
are
now
requested,
as debentures due May 1, 1952. Both
members, to fill in a list of issues were dated Aug.
1, 1951,
last
100 trades at
retail, and were placed at
par.
They are to be reported in conOf
the > proceeds,
$93,395,000
secutive order. You are supposed was used to retire a like amoun
to state
the date of acquisition, of debentures
maturing Aug
1
the cost, the date you obtained
1951, and $7,620000 was new
the order, the date you filled it
money
and
the price in
the wholesale
As of the close of business Aug
to
rid the mind, but he was asked to defend these
that
Corp.
Reports Higher Earnings
Net
debentures
you
trend
business.
those
cases
after all these years of such regulation there are an estimated
6,000,000 people who own stocks
™ this country while there are at
when
even
con-
draulic Presses and heavy fabri- stantly suspended
in an atmosrather-constructed to
cated vessels for such diversified Phere of uncertainty, buck passationary;;«ure ag^nst it^ t^an is encountered industries as steel oil
chemical, ing and bureaucratic craftiness?
maintain or; m the normal course of events.
food
products, tqxtile, smelting, Why is it hat the people who do
and
are
the
are
what was not to be a rule has
become in effect a rul*. Make a
triP around th« country. Go out
and see for yourself how many Jgjjt 30,000,000
dealers step over the 5% line— WHY?
no matter how justifiable, it might
Inf
This influence constitutes
supporting
years
SAN LUIS OPISPO
Gal
Wr
r
"*ea^ G. wickenaen nas becoi
inflation
deflation.
Government,
on
fair, where
are the customers?
the
investment
an
per
both
to be convincing, it
arguments
policies that tend to
to
of
provide against future vicissitudes,
forth-in
set
toward
to
basis
each
evidence
There
enforcement
say,
better today?
be acquired in most in-
can
an
infrequently,
examples
of
.each may be found on the same
page.
Obviously, both cannot be
putting it
persecution, isn't the business
manage-'trades that figured over 5%. One
was 5%%, the other 5%%.
His
stances by first questioning the average on those submitted was
soundness
of
acquired attitudes 37/g%.
Believe it or not, he was
toward the subject. It is not only called
to
account
on
the
two
necessary to cultivate the habit transactions
where
the
markup
0f thinking about investments, but exceeded 5%.
True enough, he
also to put an end to nonintegrated was not given a formal
reprimand,
ment
survived and somehow managed to accumulate savings under
deflation,
As
me
their finan-
Not
maneuver
been
strong?
will
blessing of the Se- "If confining
Exchange Commis- have creative
who has been kind
^
nearly always
newspapers
The
rule.
a
this,
termed "compartmentality." In an
cannot
the
curities and
judg- market
,
Struthers Wells
the
in-
almost constant pelting^ from Corp. in the year ended Nov. 30,
carry
advertisements* predicting rocks, arrows bullets, guided mis- 1950) was equal to $3.48 per share
the imminence of a severe infla-Vsl^®s» -and atom
bombs. On an 0f COmmon, and
for
the
six
leading
received
investment subcellar vestor must strive to see his prob- markup,
th
un-
securities.
too
who
between
fhfis
wide y0Ur
delegate
can
because anotner world war is pos
slble> even though it would have whole.
the
use
of
investor
t
«+
factor of cor.-
The
emphasize again
[<;PresentinS its corporate struc" of
thinkingattitude
that is,
ture.
Pbuy stocks anl
fidence
listed
on
between
th^fmiD
the NASD
of
the
the delegation of
in
successful
therefore subject to what may
are
namely,
companspn,
im-,
operating will affect
now
earning
public at any
any time,
extent
may
be the safer
probable satisfactory
in the future. The
a
tion sufficiently well as to provide
aie
andacb^cck^
UmT Nevertheless
rsieverineiess,
cS It
to
management
corporation having
earnings trend will con- ,-:
securities
oe-
^1
«
date
guide
ment but not responsibility.
mediate future; that economic in-
dvd
*arge
specific
lowing tentative assumptions
fiuences
idutc that
fiidt
available
cue
1
currency
userui,
deflation
are^
icpui ih
how
be
can
members
allowed
demarcation
dealers know just where they was made on
July 17 by M G
stand on markups. Why? Why is Newcomb New York
fiscal agenf
it that they cannot obtain an un- f0r the banks.
The
financing
the most consistent performance equivocal yes or no to this
impor- totaling $101015 000 conskfpH n*
rather than the best as of any tant question?
•
* * $44 520 000 205% consolidate
the
good
on the retailing of
markups
line of
the fair and
there are
year-to-year results
during the period, suggesting that
of available information. The folmay
to
on
its
tive
in
to
useful
prove
can
mechanism will continue to func-
trends
purposes placed a ceiling of 5%
Furthermore,
buy a judgment
nor
tinue to do well in at least the
mysterious reason
inflation
ciation
should
-
credit
Dealers
A succqssful offering of two
issues of debentures of the Federal Intermediate Credit Bank
vestment' management.
In
this
connection, it seems appropriate
r^°ik acc°rd^in,g t<a.tne
■
they have in the past;
The
?ppraif?i ?! ?;the nation's intricate
prospects on tne oasis 01 moneycause
National
Securities
shows a wide range of results> siderably higher than is usually
varying from considerable capital the case. Go out and ask some
depletion to large capital appre- questions. Find out how many
attempt to make projections that
a
buy
practice sucn tormuias nave
in
gain wealth from the
be made; that
would
formulas
some
to
accruate
important, he is better off
for few, if any, of the claims of
stock-market
advisers to special
insight or devices are supported
records
look into the
clarity is de-
to
much
Vestor can neither possess
Most
show
the
ago
of
C|fl Ranfcc Pfora flohc
Nil DcflUlS rldCG UGDSn
knowl?dg<;: °f unescapable iUs m variation m performance, shows
St0\e
them . Although the in- that the investor .must exercise
has
ones
escap^
the wwnesoLthe ones
Who have followed siren voices,
actual
years
con-
°J prophecy
™ould outweigh most significant feature
occasioned
fl
has
hf^nvestment^recthude and
Penned thoworriesof the
with
plored by investors, among others,
on
the assumption that the
™oney
He
Future
inability
future
happen in the
what to do about
no
fnvp^mpnts
by
The
:
to
going
tbat
and
to
.tell
can
future and just
it
tempted
been
times
many
Some
,
Association
the period 1937-1950. The record expenses and difficulties
variations
,
..
one
rianage'nXt
envied
_
other, and therefore
Trusts,
1951
presents
comparisons of
performance of investment trusts for
he probably
being
was
income
has
ties
Please1
'
,
wise without prior approval of its and regulation is what you
want,
members, the 5% spread philos- then you have it. If all of this is
performance records of
invest- ophy
enunciated by the NASD so good for the
investor, for the
ment
trusts may give a general was merely an
interpretation of retail securities business of this
indication of the accomplishment its fair practice code rather than country,
then, gentlemen, where
task
mtjre speculative character than of
by his disillusioned friends. Today, his
/r.
(Concluding Article)
glad
was
In 1932
but
poor
'
sion which held that, while the gressive attitudes in order to sueNASD could not promulgate any cessfully operate their business)
Presumably, rule governing spreads or other- in a strait-jacket of uncertainty
would have been considered ac- agement.
ceptable a decade and a half ago.
If
foregoing supposition is
fund balanced.
In
1929, he felt Of course these must be chosen
t
appraisai can readily
prosperous but secretly envied his with special care. They have come
be ma^e
M^d >s Manual of
free-spending friends whose mar- to be known as
growth stocks
Banks, Insurance, Real Estate, Ingin accounts were making them or issues having a low yield or
vestment
in
Answer
gross
to agitate the price level to
much
By JOHN BUTTON
haphazard
a
under present tax laws is through
.Delegating Judgment
a violent
degree. Looked at some- "long-term"
(property held for
Investment trusts are often manWhat differently, the value of the more
than six months) capital ag^d by the same individuals who
dollar
went
down
and. up
and gums. The individual is allowed function as trustees of other funds
down, so that in some years it t° keep j;bre^~(luar*;ers °* these and as investment advisers for
would buy two to three times as as iar as the Federal government
wealthy individuals.
acted
Securities Salesman's Corner
tempera-
uninterest-
firm hold 011 the government's small funds, the latter is usually
P°utical Philosophy. Under these accomplished through the purcondlU°ns the question of survival chase of investment-trust issues,
speculative boom,
peninsular
a
affairs
to devote to it. To other
seen
a
and
game, and, in
those occupied
or busi-
a
even
fht Sivlly ^^r^Tt^be^an^d "sfd
of its HufeS
country has
answered supervised TluoLTTr^t
by attorneys, t r u s t SV"
of Fair ^terpre'atxon
Practice, to all intents and
WUhin
a
might
cases,
closely with professional
a
and
flation during the Dast third of
they
as
31
Angeles
He
wasformerly(
representative of Conrad
representa^
^ and P»or thereto•
Brucf
'
was W!,.,
the regulating and who have the Walston, Hoffman & Goodwin.
etc.
power
to
put
you,
or
any
other
;
.
•
'
^
*
,,
Earnings accruing to common securities dealer out of business
McAndrew Co. Adds
stock during the past 10 fiscal fQr infractions of rules, and so(special to the financial chronicle)
years amounted to more than called codes of fair practice, re-1 SAN FRANCISCO, Cal.—Wi
$32.50 a sbaje, of which approx- fuse t0 tell you explicitly what
ijam p# McAndrew is now w:'
imately
$5.60
was
paid
out
m
you
can
call
a
conscionable
and
McAndrew & Co
Inc
Russ Bid '
•
* ibe performed by the conservative dividends and the balance used an unconscionable profit?
Why is
*'
investor himself through study of to retire debt, increase working it they want you to leave such
T
U/:*k
Federal, state, 'information available in invest- capital, and to
expand plant facil- things to them?
Why
is
it
that
1WO
Wltll
rTOtected
inv
and
local taxation falls heavily
ment departments of the metro- ities. The
expanded and moder- you have to send them a list of
(Special to the financial chronicle)
.on anyone with means above the
politan newspapers, national busi- nized production plant places the
your
transactions
periodically,
SAN FRANCISCO, Cal.—John
subsistence
level, and. it almost ness and financial
publications, company in an excellent position and
they
are
privileged
to A. Mapes and John J. Zimmer arc
always lengthens with the years, and published financial services, to
share in the increased indus- sit in judgment over
you after the now with Protected Investors of
The deepest part of this shadow
Many investors enjoy this pursuit trial activity in prospect.
act, but have given you no posi- America, Russ Building.
The
The
,
Long
T
shadow
Shadow
^
of
Volume 174
Number 5036
The Commercial and Financial Chronicle
(131)
rather
than by Government-in¬
spired mandatory restraint. How¬
brokers'
ever,
the
to
cern
loans
of
are
conservative
laid
is
by the government's pro¬
individual income tax.
Within a single generation, it has
towered up from a tax to a con¬
gressive
con¬
investor
only as they may affect the mar¬
ket level, since he is too well in¬
fiscation
formed
regarding
of
hazards
the
maintain
to
involved
margin
a
account
-
has
Much
been
about
written
talked
inflation
flation during the past
and
third of
returns
concept
of
substantial
on
as
philosophy. Under these
conditions the question of survival
for those
depending on income
political
de¬
and
well-to-do
The
"unearned income" and
therefore reprehensible, has taken
a
firm hold on the government's
tions,
*;■. Your Dollar's Worth
,
the
as
that is, capital accumula¬
savings,
himself.
far
as
concerned.
are
a
they
as
such
might
cases,
a
and,
game,
those
even
affairs
can
ing,
the
and
either
way
such
Securities Salesman's Corner
persons'
in
tempera¬
uninterest¬
is
process
managed
or
busi¬
or
usually find time
to devote to it. To other
ments,
in
occupied
closely with professional
ness
a
funds
are
By JOHN DUTTON
haphazard
managed under pro¬
direction. In the case of
are
fessional
31
Answer, Please!
(Concluding Article)
small
funds, the latter is usually
accomplished through the pur¬
.
Some
years
the
ago
National
tive
line of demarcation
chase
Association
and
via an
the fair and the foul?
Do you think this is
wise without prior approval of its
and
members, the 5% spread philos¬
ophy enunciated by the NASD
was
merely an interpretation of
its fair practice code rather than
then you have it.
of investment-trust issues,
large funds are customarily
supervised by attorneys, trust
companies, and investment
of
Securities
Dealers
between
interpretation of its Rules
Within this
relatively
putting it
from securities can be answered
of Fair
Practice, to all intents and on too strong?
period, the country has seen
There are those
only by ingenuity.
purposes
placed
a
a world war, a speculative boom,'
ceiling of 5% on who will say, enforcement has
The only way left open through counselors.
gross
a depression,
markups
allowed
to
its been fair, where are the
another world war,
cases of
which wealth can be accumulated
members on the retailing of un¬
and
a
peninsular war that all
persecution, isn't the business run
Delegating Judgment
listed securities.
The maneuver better today?
acted to agitate the price level to under present tax laws is through
And I say to you,
(property held for
a violent degree.
Investment trusts are often man¬ received the blessing of the Se¬ "If
Looked at some¬ "long-term"
confining
men
(who
must
than
six
months)
capital aged by the same individuals who curities and Exchange Commis¬ have
what differently, the value of the more
creative
minds
and
pro¬
dollar
went
down
and. up
and gains. The individual is allowed function as trustees of other funds sion which held that, while the gressive attitudes in order to suc¬
to keep
three-quarters of these and as investment advisers for NASD could not promulgate
down, so that in some years it
cessfully operate their business)
any
rule governing spreads or other¬ in a strait-jacket of
would buy two to three times as as far as the Federal government wealthy individuals.
Presumably,
uncertainty
century.
short
much
it would in others.
as
is
Dur¬
concerned
further
the conservative
investor did not fare too badly.
In 1918, he probably wished that
he had
put- all his money into
Submarine Boat or its equivalent,
but in 1921 he was glad of his
ing this
period,
quently,
fund balanced.
In 1929, he felt
prosperous but secretly envied his
Of
his
ac¬
as
securities.
The
The
Future
look into the
inability to
future
with much clarity is de¬
plored by investors, among others,
on
the assumption that the
chances
to gain wealth from
the
gift of prophecy would outweigh
the distress occasioned by fore¬
knowledge of unescapable ills in
store for them. * Although the in¬
vestor can neither possess nor buy
who have followed siren voices. accruate
foreknowledge, he can
Most important, he is better; off,
attempt to make projections that
for few, if any, of the claims of should
prove, useful on the basis
stock-market advisers to special of available information. The fol¬
Insight or devices are supported lowing tentative assumptions may
by actual records. It is easy to be made: that a corporation having
show
how
have
enabled
would
formulas
some
investors
good
a
"buy
to
earnings
will
trend
high" in past markets, mediate future; that economic in¬
such formulas have fluences now operating will affect
failed for some mysterious reason securities in a similar manner as
The
\
according to theory.
to work
they have in
stock-market
of
appraisal
the
past;
that
and
intricate
nation's
the
economic
prospects on the basis of money- mechanism will continue to func¬
credit trends can be useful, be¬ tion
sufficiently well as to provide
inflation
cause
and
deflation
are
earning power for the securities
representing its corporate struc¬
important market influences and
because reports are available that
show
how
large a volume of
ture.
War
and
checking-account
Most
people cannot afford to
deposits is in the possession of the
retire into an investment subcellar
public at any time. Nevertheless,
because another world war is pos¬
these figures do not measure the
extent to which people will use sible, even though it would have
currency
a
.their accounts to buy stocks and
'are therefore subject to what may
be the dominating factor of con¬
sections
advertisements
•
predicting
the imminence of a severe infla¬
or
of a disastrous deflation.
evidence
the
in
forth
set
of
each
other
•than
inflation
to
deflation.
in
the
•
investment
guarantee
so. On
No
it
more
I course
normal
pres¬
matter
cannot
itself.
events.
of
Management
how
investment
an
con¬
a
program
to sustain
Fund
for
■
improved,
no
against it than is encountered
sure
Inflationary
the longer term.
is
is to maintain
constructed
rather
policies that tend to maintain or
to raise prices are popular with
Government, labor, and business.
This influence constitutes a strong
^supporting force for the general
level of common-stock prices over
there
war,
servative
that the trend
assume
toward
be
constant
whole, it would seem that
the best way for an investor to
provide against future vicissitudes,
including the possibility of an¬
left to
basis
the
appear
•is safer to
will
on
man¬
the
If arguments on both
to be convincing, it
prognosis.
sides
reader is
the
choice
his
make
mankind
that it will continue to do
Obviously, both cannot be
right,, and
that
somehow
of survival has
although
may
page.
almost
chance
infrequently,
examples
of
be found on the same
Not
fact
and
pelting from
rocks, arrows, bullets, guided mis¬
siles, -and atom bombs. On an
actuarial basis,
the individual's
tion
.each
the
survived
an
leading newspapers nearly always
carry
their finan¬
on
aged to accumulate savings under
the
of
in
taken
has
financial
The
disastrous effect
cial affairs. Some comfort may be
fidence.
;
be
well
conceived
program
Someone
The
and
.on
Long
shadow
local
must
to
anyone
of
with
Federal,
falls
means
state, 'information -available
heavily
above the
subsistence
level, and it almost
'always lengthens with the years.
The deepest part of this shadow
fend
give
it
can
>be performed by the conservative
investor himself through study of
Shadow
taxation
be,
may
abandoned
informed attention. This task
The
indication
in
invest¬
ment
departments of the metro¬
politan newspapers, national busi¬
ness
and
and
financial
published
publications,
financial
services.
Many investors enjoy this pursuit
the
of
professional
agement.
If
the
of
invest¬
investment
man¬
made.
a
rule.:
As
foregoing supposition is
an appraisal can readily
correct,
be
one
give a general
accomplishment
may
of
in
other, and therefore
records
trusts
Moody's
Manual
of
become
have
years
not
was
to
effect
in
regulation is what you want,
good for the
retail
gone
be
rule.
a
along
rule
a
has
Make
trip around the country.
a
Go out
securities
country,
be to
do
in
expenses and difficulties are con¬
shows
siderably higher than
wide
a
of results,
varying from considerable capital
depletion to large capital appre¬
range
the
so
Go
case.
cases
out
even
when
ask
some
of
this
after all these years of such
regu¬
there are an estimated
6,000,000
people who own stocks
country while there are at
30,000,000 who should?
in this
FIG Banks Place Debs.
is usually
and
business
gentlemen, where
Why is it that
lation
least
formance of investment trusts for
the period 1937-1950. The record
then,
If all of this is
investor, for the
the customers?
are
/v
the
what
so
Banks, Insurance, Real Estate, In¬ and see for yourself how many
dealers step over the 5% line— WHY?
vestment
Trusts, 1951, presents
comparisons of management per¬ no matter how justifiable, it might
A
successful
offering
issues of debentures
of
of
two
the
Fed¬
questions.
Find out how many eral Intermediate Credit Bank
know
ciation. Furthermore, there
just where they was made on July 17 by M. G.
are dealers
variations in year-toryear results stand on markups. Why? Why is
Newcomb, New York fiscal agent
it
that they cannot obtain an un¬ for
during the period, suggesting that
the
banks.
The
financing
the most consistent performance equivocal yes or no to this impor¬
totaling $101,015,000, consisted o~
rather than the best as of any tant question?
$44,520,000 2.05% consolidated
specific date may be the safer
debentures due Nov.
1, 1951 an "'
Here Is What Happens
guide to probable satisfactory
$56,495,000 2.35% consolidated
management in the future. The
You
are
n o w
requested, as debentures due May 1, 1952. Both
most
significant feature of the NASD members, to fill in a list of issues were dated
Aug. 1, 1951,
comparison,
namely,
the
wide your last
100 trades at retail. and were placed at par.
variation in performance, shows
Of
They are to be reported in con¬
the
proceeds,
$93,395,000
that
the
investor
exercise secutive order:
must
judgment in the delegation of in¬
to
vestment
state
the
cost,
the
order,
to
and
emphasize
investor
the
again
ment but not
the
fact
delegate
can
that
responsibility.
this,
perspective
successful
stances
for
first
by
soundness
questioning the
acquired attitudes
of
toward the
necessary
date
the date
price
in
filled it
you
the
that date.
on
subject. It is not only
to cultivate the habit
as
in
me
requisite
investment
manage¬
be acquired in most in¬
ment can
the
supposed
acquisition,
you
obtained
are
of
wholesale
So you do
done by one dealer
who has been kind enough to tell
Perspective
The
the
judg¬ market
You
date
the
management.
In
this
connection, it seems appropriate
con¬
but in practice
conscientious
as
in the
performance
tinue to do well in at least the im¬
sell
low,
are
as
ment
half ago.
a
"growth stocks,"
having a low yield or
all, but possessing out¬
standingly favorable prospects for
future earnings that would en¬
hance their sale price. The selec¬
tion of these issues requires more
exacting investigation and analy¬
sis
than
is
required for other
from
expenses
considered
at
none
the 1939
level, but the gap is not great. '
The conservative investor pas
many
times
been
tempted to
wander off the path, to believe
that someone can tell him just
what is going to happen in the
future and just what to do about
it and that no one makes money
out of a balanced program of di¬
versified
investments.
He
has
been only mildly unhappy about
pis investment rectitude and has
escaped the worries of the ones
as
been
decade and
a
issues
or
much
so
states
course, these must be chosen
with special care. They have come
free-spending friends whose mar¬
increased
task
to bb known
gin accounts were making them
millionaires. In 1932, he probably
felt poor but was being envied
by his disillusioned friends. To¬
day, his income from his securi¬
not
they
have
would
ceptable
has
make
this). Conse¬
conservative
investors
on
having considerable capital are
being forced to purchase issues of
a. more speculative character than
strong-mindedness in keeping his
ties
(some
inroads
was
confidence
him.
to
list
of
to retire
a
like
1951,
maturing Aug. 1.
$7,620,000 was
new
and
money.
As of the close of business
bentures outstanding amounted to
$790,235,000.
happened
two
were
Marache Sims Adds
figured over 5%.
One
5%%, the other 5%%.
His
average on those submitted was
37/8%.
Believe it or not, he was
Spencer
called
staff of Marache Sims &
account
transactions
exceeded
also to put an end to
was
not
but he
on
where
5%.
given
the
the
two
(Special to The Financial Chronicle)
markup
LOS
South
a
enough, he
formal reprimand,
trades
at
has
been
Cal.—Earl
added
to
F.
ti
c
Co., 6C
Spring Street.
With Harris
retail
at
over
5%
Upham & Cr.
(Special to The Financial Chronicle)
When he requested to know
if the NASD had a rule that for¬
sales.
bid
ANGELES,
True
asked to defend these
was
Aug.
1, 1951, the total amount of de¬
was
to
amoun
debentures
trades that
of
thinking about investments, but
nonintegrated
thinking, that is, to rid the mind
of
an
attitude
that
might
be
termed "compartmentality." In an
extremely brief summary, the in¬
vestor must strive to see his prob¬
lem
clearly and to see it as a
what
his
In
used
was
LOS ANGELES, Cal.—Jared C
has become affiliated w
Aiken
informed, that Harris, Upham & Co., 523 W r
Sixth Street.
He was former./
rule; it was just an
with Dempsey-Tegeler & Co. a...
whole.
interpretation."
When
I asked
him. why he didn't insist that he Morgan & Co.
be
told
in
straight
and
un¬
Struthers Wells Corp.
equivocal black and white just
With Morgan & Co.
how
much
markup
he
could
(Special to The Financial Chronicle)
Reports Higher Earnings
charge, he looked at me in amuse¬
Net income of Struthers Wells
LOS
ANGELES,
Cal. — Jac k
ment
and
said, "Why should I
Newman has joined the staff (
Corp. in the year ended Nov. 30, waste
my time; everybody in the
1950, was equal to $3.48 per share retail securities business has been Morgan & Co., 634 South Sprin;
of
Street, members of the Los An¬
common,
and
for
the
six
trying to get an answer to that
months ended May 31, 1951, earn¬
geles Stock Exchange.
He was
one for years?"
formerly with Cantor, Fitzgerald
ings of $2.91 per share compared
markup,
he
"5% wasn't
was
a
.
with ' 86c" in
period
dividends
almost
7%.
corresponding
Quarterly
& Co. and Daniel Reeves & Co.
Why the Mystery?
year.
the
at
rate
furnish
annum
per
the
last
of
The
a
company
Do
$1.40
of
return
of
makes
ness
as
you
believe that any busi¬
as essentially creative
that is
the
securities
industry
and
the
balance
used an unconscionable
profit? Why is
working it they want you to leave such
capital, and to expand plant facil¬ things to them? Why is it that
ities. The expanded and moder¬
you have to send them a list of
nized production plant places the
your
transactions
periodically,
to
retire
debt,
company
in
to
in
share
trial
increase
excellent position and
they
are
privileged
to
the increased indus¬ sit in judgment over you after the
an
activity
in
prospect.
(Special to The Financial' Chronicle)
SAN LUIS OPISPO, Cal.—Wi
prosper,\
fred C. Wickenden has becoi
forgings, boilers, heavy duty mix¬ be, if it is to grow and
can become healthy if it is con¬
ing and kneading machines, hy¬
draulic presses and heavy fabri¬ stantly suspended in an atmos¬
cated vessels for such diversified phere of uncertainty, buck pass¬
and bureaucratic craftiness?
industries as steel, oil, chemical, ing
Why is it that the people who do
food
products, textile, smelting,
the regulating and who have the
cement, pulp and paper, etc.
power to put you, or any other
Earnings accruing1* to common securities dealer out of business
stock
during the past 10 fiscal for infractions of
rules, and soyears 1 amounted
to
more
than called codes of fair
practice, re¬
$32.50 a share, of which approx¬ fuse to tell
you explicitly what
imately $5.60 was paid out in you can call a conscionable and
dividends
Wickenden With Morgar
must
act, but have given you no posi¬
associated
with Morgan &
-
Co. ek
Los
Angeles. He was formerly
representative of Conrad, Bruce •'
Co. and prior thereto was witV
Walston, Hoffman & Goodwin.
McAndrew Co. Adds
(Special to The Financial Chronicle)
SAN
liam
P.
FRANCISCO,
McAndrew
is
Cal.—Wi
now w;
McAndrew & Co., Inc., Russ
Bid
Two With Protected
Inv
-
(Special to The Financial Chronicle)
SAN
FRANCISCO,
Cal.—John
Mapes and John J. Zimmer arc
now with Protected Investors of
A.
America, Russ Building.
The Commercial and Financial Chronicle
-
32
(532)
r"'
.
Continued
from
talized banks
15
page
profits
cess
are
paying exwhile heavily
now
taxes
Continued
banks are not. Thus,
profits taxes deny under¬
from
Thursday,-August 9, 1951
.
/-'■;" '
/■
13: '
page
...
*
"
'"\V
:
•:
j
/
.
;
capitalized
The
excess
Impact oi Higher Taxation
cash dividends, or
and
6%
return
fair
a
as
more,
capital.
on
Third: In the case of large
banks,
of $10 mil¬
lion, this 4% rate means that the
law establishes in principle a nor¬
with capital in excess
mal
not more than $4 of.
earnings
recurring
value.
book
Federal
under
fixed
return
enactment of
This
$100
per -
of
for
return
low
rate
taxes,
47%, normal
at
now
non-excessive earnings should
or
V
12% of all invested
be defined at
quired to relieve the critical im¬
passe now facing banks.
;
;
bank hold-
?Provisions affecting
partially-
and
wholly
of
ings
exempt investment securities, described/by existing tax law as
"inadmissible" assets, are basically
necessary. However, the present
ket at 25 times to support quota-:, limitations should be reconsidered
tions equal to book value, a valu- and changed to correct obvious ination admittedly out of line and equities. To relate such holdings
banking capital would have to be
appraised in the investment ipar-
equities.. to amounts held
unreal in the market for
additional shares
Jan.
on
1950,
1,
to both
table
The
of
earning before exce^ Drofits
^n
invested capital
S in
fn ex.,
on invested,
taxes
taxes,
ex-
of $10 million would be less
cess
effect taxed at
total
47%
and
30%.
a
normal
of
rate of 77%;: the
of
surtaxes
and
profits taxes of
serious question, in¬
which
capital
It is
a
ject.to this,77%, rate.
encourage
be
The ability of commercial banks
with the expanding needs
of industry and to furnish the es¬
sential services demanded by a
defense economy is therefore re¬
I
sets, high .in relation to existing
capital. Except for the few who
.,
,
would
1V
want
an
_
credit
functionsj
difficult
situation
are serious and demand
realistic approach to bank earn¬
a
ings;;
/:;,/'••'••// V//:;//::'/*/
./
Small
-
Investor
Suffers
•
'
?
;
The present exemption allowed
12% on the first $5 million,
of
10%
is
penalty
a
But
w
additional invested capital
on
these
i d
e
the larger banks.
on
are
the .banks ..with
.
1V distributed
ownership.
Therefore, these penalty rates on
large banks hurt the small in¬
vestor. •
v
' \> ; .
■
The
.
question has been asked, to
what extent does the 8%
invested
capital
apply?
rate
The
rate applies to banks with invest¬
ed
capital in
of $10 million.
excess
These
are
the banks which hold
half of the $11.3 billion capital and
half of the $153.5 billion
deposits
of the 13,446 insured commercial
banks. Including banks with in¬
vested capital of between $5 mil¬
lion to $10 million, the
penalty
rates of 10% and 8%, before
reg¬
ular income taxes, affect the
major
part of the banking assets through¬
out the country, and hurt the
great
majority
of
bank
shareholders
everywhere.
"inadmissibles"
in
equal to their invested
Only holdings in excess
penalty
capital.
The
proposal
to
increase
the
regular corporate tax rate from
47% to 52% would cut investment
returns
a
even
realistic
profits"
rates
8%
further.
This makes
definition
more
of
"excess
invested capital lose
on
mean-
ing with each
taxes,
or
increase in regular
realistic, a definition
profits
must allow in-
lo be
excess
vestors
incentive
to
continue
as
shareholders and to approve
pro-
Earning
cash
0£ 0perating income, less operating
of
new
funds
will dry up.
If fair hire for bank
taken to mean cash
profits
mean
principal,
,,
or
book value, then the
recurring
earning power of banks after taxes
should
be
protected
at
than 6% of book value.
SL
net
of 6%
aft^r
atter
not
less
ies
on
or
other
losses
or
sale of
on
or recover-
loans, transfers to reserves,
transactions,
capital
the tax credits
or
or
tax liabilities to
which these sometimes give rtse.
Banks must .retain a portion
To secure
ord
their banks with
see
totals
rec-
lo&ns, and deposits.
of
interest rates
ties.
loans and securi-
on
Stockholders
unable
are
to
reconcile these evidences of pros¬
perity with their banks at
As
count.
"For
18
one
years
investor observed:
banks
ai discc
discount.
these
dis¬
a
have
During most
there
years;
years
been
not
-was
enough business to make banking
profitable. Now banks.have plenty
of business, but Federal taxes
eel out this prosperity."
If independent banks
-
*.
can-
.v /
sumption is losing and
all-time
an
pounds
are to con-
ments
throughout the country have
the obligation to state their share-
holders'
ities.
case
to
Present
our
taxing author-
conditions
no
are
recommendation to private capital
for investment in banks.
If
^-0
blocked,
One crop
capital
funds—necessary
in their
.
remains
access
should
is
taxes
of
6%
At the year-end,
public utilities.
results for
electric
an
fpes
pome
are
JntnnSi
unknown.
are
banks, the returns do not come
together. It is basic to banking
in
bank
be
Exchange
announced the following firm
changes.
_
''9
*m
_
on
Co.,
^
n
M
pjjj{en«
Russ
was
changed to Helen N.
^ffective Juf
rent
demand. Other countries, even if
El worthy CcC
SAN
^
anticipated for this year.
the past: years we had
During
been
living partly
the
for
first
cushion for losses.
serves
time, it seems as if
is to be larger
Government
is
th
to
the
keep
up
other
decrease in retail coffee
a
prices. Cocoa production too
A~*be
-
Avv';
e £aiPlnS' v*:-rV;
*
„
in
will not be
For the first time last week
had
gaining*
Sugar
crops
than before
world
much
are
the
V-V'-
larger
The
war.
production
seems
v.-:
1950-51
estimated
is
6%
at
power
banks in good
factor
is not enough for
times when the risk
the
of the five
average
oc
1
non
1QQQ
4
/in
.n
went up
went ud
years
-
.
D
because
of
stockpiling
in
present the
due
to
demand
previous
is
little
is
small
hoarding,
doubt
will
nearly
war scare,
be
year.
and
that
sugar
ample
is in the ascendance.
Taxes
Penalize
Growth
There
next
there is
One
a
in India
is
for
demand
generally. It is
though,
could
tive unless the
whether
become
price
effec¬
to
were
(Special to The Financial Chronicle)
come
support additional capital. But the
is
which
vested
to
effect
of
heaviest
are
in
the
Growing
profits
excess
^
Cal.—John
x
UU1U1
on
those
neatest
Ss
banks
need
of
of
the wheat
which
we
are
other
i
1
capital problems.
v
'AA
Two With Faroll & Co.
r
CHICAGO,
';
(special to the financial chronicle)
-
..
111.—Edward
Flan-^'
a
;
'
.
.
^
<...
w
-
^
mgan and Raymond Resnick have
become connected with :xiFaroll &
Co> 209" South
members
La
the
of
Midwest Stock
,/
Arthur V.-
Salle
Street;
and
York
New
Exchanges.'
'
-
King Joins
(Special to The Financial Chronicle)
■;
BOSTON, Mass.—Arthur V. King
has become associated with
mon
Bros,
Street.
&
Mr.
Salo¬
75 Federal
Hutzler,
King was formerly
with A. C. Allyn & Co. and E. H.
Rollins &
Sons, Inc.
Daniel Rice Co.
,
.
Stock
Ex-
and
Company, 141 West
Boulevard, members of
at
Exchanges.
of
the
second
World
production of
a little higher
production
cannot
world
wool
be
the New York and Midwest Stock
With Shearson, Hammill
(Special to The Financial Chronicle)
CHICAGO, 111.—Frederic Cimerblatt is with Shearson, Hammill &
Co., 208 South La Salle Street.
With Richard J. Buck
population.1 Also, wool
strategic material and most
a
countries,
including
would
glad
be
our
own,
to
stockpile it.
Therefore, in order to relieve the
permanent
tightness
which
-
(Special to The Financial Chronicle)
BOSTON,
Mass. —Lyman
R.
Dodge has become affiliated with
Richard
J.
Buck
&
Co., 8
New¬
bury Street.
-
.
Nankln is now aifiliated would otherwise exist, substitutes
Francisco
added to the staff of Daniel
Rice
isted
end
<;
CHICAGO, 111.—Jack P. Leo has
been
wool.
the
Adds
(Special to The Financial Chronicle)
Jackson
1 Montgomery Street, members of growing
are
With J. W. Goldsbury
ever
amounts. /Attempts
that direction
fused
anything
as-
(Special to The Financial Chronicle)
in
MINNEAPOLIS, Minn.—Orville
being made all
are
.
Undercapi-
100%
but
wool,
Marquette Avenue.
William S. Beeken Adds
(3pecial to The Financial Chronicle)
earnings —12 %,
than banks where there
i
? ;
in: change. He was formerly with over the world. Our own army,
which until a few months ago re- with J. W. Goldsbury & Co., 811
Hutton & Co.
10% and 8% of invested capital—
-x
135
of
Mri
Shares, Inc., and prior thereto was
with Farwell, Chapman & Co.
^
F.
wlt^ Lawson, Levy & Williams, for wool have to be used in
San
witA
Inc.,
A. Erickson has become associated
where
deposit liabilities and risk
"non-excessive"
no
FRANQISCO, Cal.—Shel-
capital is small in relation
sets exceed the statutory limits of
sooner
Lawson, Levy Co.
.
the
Co.,
&
was
formerly Chicago
representative for Knickerbocker
in
(Special to The Financial Chronicle)
.n
:;
Sommers
spot of tightness is
The large stocks which ex¬
is
SAN
Byllesby
the Midwest Stock Exchange.
very much. Our own rice
is the highest; ever and we
shall have to rely heavily on ex¬
ports. Rice may take the place of
increased
B.
Dottarar
is
now
with
First sh^ificantly while the demand is
California
Co., 300 Montgomery
J
sfea(hly
rising in view of the mcrease
FRANCISCO,
Joins
1
.
.
South La Salle Street, members
crop
wool last year was
than previously, but
Joins First California
This is
higher rate of earnings is essential, first to provide adequately for
losses; and second, to justify and
become associated
has
M.
of
which
large potential demand
and Asia
doubtful,
very
rice
RitTUck^
Salomon Bros.-Hutzler
remain two real spots
tightness.
Street.
particularly applicable to
undercapitalized banks where a
H.
J.
■
'"'A
'
,
(special to the financial chsonicle)
mers
..
in the past
nast months
all countries due to the
re-?
CHICAGO/111.—Ralph M. Sorir4
;.
compared with 34 million tons
as
The
.
FRANCISCO, Cal.—Robert
SAN
.
at
.41 million short tons (raw value)
mod
1Qo-
our
needs as
our
bommers With Byllesby
c
countries, this
easy.
we
production
grains^
last-vear
were
/
of. coffee.
price
increased
With
if
even
ample for
are
UfiA
Brazilian
trying frantically
for 1
ttiey werc last year-
J*1®11 /°/^ consumptforu In -the
completely.
Hence, earning
their warehouse in
as
emergency
world/situation,
world production
face of this.-situation
of
ing threatened by changes ,in the
the stocks
on
of coffee from former years. Now,
•
added
Because the world
level is always in danger of be-
of 10% is
of
the
•
_
,
possible for banks to set aside out
earnings
because
which hag done and
CQUnt
,
Hutchins has been added to the World War and which threatened
staff of Elworthy & Co., Ill Sut- to have a depressing effect on the
price, have been worked down
te*' Street,
recurring
oversup'ply
stockPiIe the
nnf
fats and oils, and fibers, our price
Adds
(Special to The Financial Chronicle)
Therefore, in defin-
th^vS nppd°^^nI?
+han
giving to India.
earnings, not out of existing
capital funds.
of
In
They are now starting to bear and
some
that
provision for losses be made
out of sufficiently adequate cur¬
/
down
_
The name ot Helen N- Biddison,
limited partner m N. D. Biddison
.
^
?
times
this
?a£fmopt
Gammack & Co.
It.
the lesson
that the United States is the only
country to be called upon by the
whole world in years,of increased
right after the war
plantings of coffee trees,
there
,
For
us
creased
At
capital
The New York Stock
the
in-
prnenses
The losses
known.
In
and
re¬
Paying
taught
year
high prices for coffee
production
power
company are known, but in
case of a
bank, only interest
eventual
can
Exchange
Weekly Firm Changes
provi-
Banks differ from
how
public funds to take the
New York Stock
after
net
before
calculated
sion for losses.
the
avoided?
that
remembered
be
power
to
place of private
...
earning
—And
Last
1935-36 to 1939-40. Prices never-
„
continues,
deposit liabilities and risk
./..<"
'•
;
f!
assets.
It
growth
as
can do so.
made for in- looks to us
coffee. The
course
their
year
which is doing much
was
hoped
for
is
than
better
\
-The Provider of the World
U. S.
& EGA/,;
-
to end this scarcity. '
means
10
'seeds^machlnery" an/The
kge
on
capital
new
time until the substi-
some
before the war
was
constructive heip of
their present capital
from erosion; and, second, to add
because of the tremendous
than
this
the
be at
may
less
capita
per
higher than it
theless
and withdrawal Of existmg capital theless
to
of
low
Europe food production is already
-;
tinue, they must be profitable to
shareholders. All bank" manage-
of
protecting
take
government-supported
cient progress, there is no doubt /
inSs (made of vegetable oils) our that in view of the impossibility-.
supplies of milk and dairy prod- of increasing world wool product .
ucts wiU be ample. / Butter con- tion, the industrial .sector will be
recurring earnings, first, to
create reserves for losses, thereby
their
romilov
ret>ular corpo-
It does not
securities, charge-offs
capital
capital is
dividends at
_e,
less applicable State and
Federal income taxes.
taxes
source
of
source
day-to-day bread and butter items
low
figure; the
the
power,
Operating earnings-^-the result of
adverse
a
these
of great prosperity and high
level of financial activity, share-
quoted at
dividends, means net current
high
asking for blends of wool;
now
price of butter and the decreasing tutes for wool have made suffix'/
years
of
The
too
the
Reserves Must Be Earned
investor will
accept
cause
appropriate reduction of
invested capital credit. .
posals for capital increases.
not
be
for
pressing, since the
of 12%, 10%
and
allowed
should
amount
this
of
ing normal earnings not subject to
excess profits taxes,
it should be
Minimum Wage for Capital
Dur ing
They note "the progressively higher
permitted to hold with-
should be
on
8%
which
number of bank mergers throughout the country.
••
;
understandable.
-
and sythetic fibers/ While it will ;
increasing
excessive earnings. Further, banks
the second $5 million and
on
8%
the
holders
1?^®?expenses,
the
implications of this
in
seen
ducing .the invested capital credit
used to determine normal or non-
tarded.
Already, State and Fedoral banking authorities are con¬
cerned with the level of risk as¬
the tlow of new
tax-exempt securities without re-
amount
to grow
development
—a
be
commercial
To
Shareholders find merger procapital, posals irresistible. This is quite
only fair that these new funds
made free for investment in
it is
put
-4
.
from
radically changed conditions.
excess
deed, whether shareholders, un¬
derstanding this impact of Federal
taxes, would want their banks to
■assume banking risks while sub-,
under
operating
now
are
In view of
.
banking
banks—the amount over and above
the
is
numbers
in cattle
beef cattle.
acts to depress bank shares even against 17.3 pounds in 1939. further and to widen the discount
World Crops
at which they have been quofed.
Federal taxation r is
a \ factor / Abroad the last* remnants
prompting the withdrawal of pri- world shortages have ended.
can
these low normal earnings—are in
This
than 4% after regular taxes.
vate
:
prices of margarine and shorten-
that the effective rate
means
great many of the 13,446 insured
commercial banks, all ,of
The so-called "excess profits" of
*
.
rntP^frnnT
52%
imposes an unjustifiable hardship
a
r
.
increase
will be in
stock¬
new
viw_
on
•
<
whole
basis equi¬
a
„
Hence, the discount on stockhold*
e
on
proposal to raise the regular
€.rs' money.
•'
Farm Products
through sale of
old and
holders.
This is the minimum re¬
capital.
Scarcity to Abundance in
power
On Commercial Banks
often
From
'banks
the: earning
required to build up their
capital", through retention of re¬
curring earnings after payment of
capitalized
1 How
herds
WEST
David
arirjpri
^
L.
to
PALM
BEACH, Fla.Swank, Jr., has been
01
the
staff
of
llcus
UCC11
William
,a
UI William »-»•
Beeken Co., Harvey Building.
//
^
1951
difficult
can
lamb
be
it
seen
crop
is
is
from
only
to
increase
the
1%
fact
our
last year's in spite Of last year's high
w°o1 and lamb Prices- This» hv thfi
was
the first increase after
crease
since 1937.
Joins John G. Kinnard
sheep
that
(Special to The Financial Chronicle)
higher than
a
steady de-
MINNEAPOLIS,
Minn.—Frank
F. Dick is with John
&
G. Kinnard
Co., 71 Baker Arcade.
{Volume
174
Number 5036
.
.
The Commercial and Financial Chronicle
.
(533)
33
-
^
'
**
t
*.
V
The following statistical tabulations
Indications of Current
Business Activity
Indicated steel
Equivalent
Bteel
STEEL
operations
INSTITUTE:
(percent
of
Week
capacity)
—Aug. 12
to—
ingots and
week
Latest
AMERICAN IRON AND
or
or
month ended
Previous
Month
Week
Ago
101.1
101.5
month available.
on
that
Dates shown in first column
date,
Aug. 12
■
2,021,000
2,029,000
Ago
101.5
2,029,000
in
or,
BUILDING
CONSTRUCTION—U.
LABOR
99.9
—
new
Private
1,926,800
Month
of July
construction
Crude
PETROLEUM
oil
and
gallons
Crude
each)
daily
—
(bbls.
average
stills—daily
(bbls.)
average
Gasoline output (bbls.)
Kerosene output
(bbls.)
!
Distillate fuel oil output (bbls.)
Residual fuel oil output (bbls.):
Stocks at
^
refineries, at bulk terminals, in transit
Finished
and
Kerosene
unfinished
(bbls.)
Distillate fuel oil
Residual fuel oil
gasoline
(bbls.)
«
and in
July
July
.-July
July
July
28
6,024,600
28
116-296,000
28
21,539,000
5,521,550
Nonresidential
6,406,000
6,595,000
5,870,000
Industrial
2,540,000
21,363,000
2,477,000
21,828,000
28
2,080,000
19,981,000
2,293,000
8,174,000
8,721,000
8,732,000
July 28
8i858,000
7,266,000
8,963,000
9,036,000
7,870,000
122,104,000
127,006,000
24,142,000
65,700,000
109,206,000
23,352,000
61,437,000
41,097,000
42,253,000
pipe lines—
at
6,180,550
28
at
July 28
July 28
(bbls.) at
(bbls.) at
July 28
76,938,000
July 28
44,957,000
ENGINEERING
—
121,156,000
26,959,000
26,402,000
*75,001,000
*44,045,000
Bituminous
(U.
coal
S.
BUREAU
and
lignite
STORE
Social
EDISON ELECTRIC
Electric
output
804,570
821,615
845,011
673,492
652,067
688,042
686,304
I
RESERVE
—
$209,262,000
88,093,000
116,094,000
93,168,000
Educational
26,082,000
31,656,000
150,953,000
72,646,000
20,522,000
Hospital
Aug. 2
Nonresidential
10,517,000
10,714,000
986,000
958,000
145,600
163,600
Other
July 28
*234
258
7,003.209
4
7,005,261
6,077,077
(COMMERCIAL
STREET, INC.
AND
INDUSTRIAL)—DUN
;:v''->:.^i7i
2
184
6,247,464
129
4.131c
4.131c
4.131c
3.837c
Scrap steel
(per gross ton)
„
—July 31
July 31
$52.69
$52.69
$52.69
$46.38
$43.00
$43.00
$43.00
$39.17
:
PRICES
(E.
M.
&
J.
QUOTATIONS):
Straits
Lead
tin
(New York)
(New York)
Louis )
Lead
Zinc
(East St.
at—:
1
27.425c
Aug.
1
103.000c
Aug.
1
17.000c
17.000c
I_Aug.
l
16.800c
16.800c
1
17.500c
17.500c
I—_I
-
at
(St.
Aug.
—
.
at
I
,i;
Louis)
at
.-iL-i--!
—
uAug.
24.200c
S.
Government
Bonds
-
Aa
■
—
Railroad Group
;•'> Public Utilities Group-,
—
-
—
22.425c
97.500c
Produced
12.000c
Shipped
16.800c
11.800c
15.000c
U.
BOND
s. Government
Average
Baa
DAILY
Bonds
—
—
115 04
114.66
113.89
120.84
114.08
112.56
119.41
•
—
-
.
.
—
-
,
313
24
202
J
"
83
18
130
98
52
39
48
47
102
87
10
250
573
68
66
59
21
21
17
85
83
86
7
8
9
69,890
;
*15,139
47,229
*J07,426
*141,761
333,993
208,265
June
30
22,329,000
34,127,000
*30,018,000
39,221,000
58,752,000
87,477,000
194,120,000
35,473,000
64,121,000
226,997,000
54,149,000
225,034,000
63,388,000
80,792,000
114,983,000
89,767
*94,725
163,360
43,989
*48,437
93,264
49,017
*59,591
109,016
50,748,000
68,051,000
*38,305,000
June
30
June
30—_•
Stocks
(tons)
Linters
June
30
!
:
(tons)
(tons)
29,324
34,413
23,990
27,301
29,079
33,047
81,712
;
50,714
48,318
(running bales)—
K.
Stocks June 30
—
-
38,980
'
,
.
—
Fiber
Stocks
(1,000-lb
June
*43,824
'
>?■
73,799
31,271
*36,009
57,596
36,115
*45,142
82,301
bales)—
30
166
Produced
38
121
224
t
250
96
144
349
4,520
4,997
Shipped
Mote, Grabbots, etc. (1,000 pounds)—
109.42
108.52
115.43
103.97
103.30
108.52
Produced
106.92
514
106.39
111.44
620
1,252
Shipped
110.15
991
110.34
108.70
116.80
3S7
2,400
114.46
114.27
113.31
119.61
2.62
2.65
2.35
2.67
3.14
3.15
3.20
Aug. 7
2.90
2.92
2.96
2.61
2.96
2.95
3.03
2.68
v
2.85
.Aug. 7
3.19
3.20
3.25
2.88
.Aug. 7
3.52
3.51
3.55
3.25
Aug. 7
3.33
3.34
3.37
Aug. 7
3.16
3.15
3.24
2.93
2.94
2.99
-i.-—. .Aug.
'
'
109.60
■Aug. 7
——
11
680
50
107.09
.Aug. 7
—
878
39
220
103.80
Aug. 7
„
■
Railroad Group
Public Utilities Group
Industrials Group
115.82
113.89
-
;
.
102.05
Aug. ^
932
Hulls-
Stocks
7
3.09
30—.
PUBLICATION
INDEX
—
AS
JULY
OF
Composite
Piece
1935-39
—
RETAIL
1(M)
PRICE
(COPYRIGHTED
■
—
goods
Men's
-
apparel
apparel
Infants'
Home
and
3,326
f
1):
Index
Women's
children's
wear
furnishings
—
148.7
148.7
V
137.6
140.0
140.0
127.6
146.5
146.3
138.9
137.5
137.6
130.1
136.8
136.8
129.3
163.6
163.6
147.0
116.7
Piece
goods—
Rayon and
2.81
;
June
FAIRCHILD
AVERAGES:
corporate
Aaa
97.39
109.42
Aug. 7
:
*
YIELD
97.71
'
5
28
-
'
110.34
Aug. 7
5
23,755
95,626
___*
30
(tons)
17.000c
98.19
7
42
245
.
(tons)
27.425c
110.52
.
31
43
255
Meal—
106.000c
—Aug. 7
-
Industrials Group
MOODY'S
—;
June
(tons)
27.425c
Aug. 7
IIIII—IIII-IZIIAuf
I
12
of
V
.
(tons)
(pounds)
and
Hull
—
31
Oil-
106.000c
Aug. 7
r
__—
—
.
(pounds)
Produced
U.
' ■..
Shipped
Average corporate
32
PROD¬
(pounds)
22.200c
MOODY'S BOND PRICES DAILY AVERAGES:
Aaa
23
30
270
enterprises
SEED
24
15
38
45
COMMERCE—Month
mills
(pounds)
24.200c
17.500c
29
14
38
Oil—
Shipped
24.200c
service
.
(tons)
Produced
1
30
52
Produced (pounds)
Consumption (pounds)
,
Aug.
35
95
,
COTTON
OF
(tons)
Stocks
>
•
——
I.
facilities
public
AND
Crushed
Stocks
Electrolytic copper—j-,; Domestic refinery at—
Export refinery at
41
324
.—
water
at
Cake
METAL
42
31
125
institutional
naval
Received
Refined
July 31
.
124
Seed—
Stocks
168
'
>
and
SEED
Produced
COMPOSITE PRICES:
Finished steel (per lb.)
Pig iron (per gross ton)—
154
55 •;.
nonresidential
and
Shipped
IRON AGE
85
156
33
■
UCTS—DEPT.
June.
Crude
Aug.
;
-
83
287
Conservation and development
other public ;
295
BRAD-
&
116
47
72
126
...
building
Miscellaneous
Cotton
Aug.
130
47
All
COTTON
233
119
.
318
„
Industrial
Sewer
149,700
84
——
building
316,562,000
165,609,000
812,000
177
.___
construction
$404,655,000
861,000
15
324
134
—
136,880,000
105,224,000
149,500
16
461
331
———
114,995,000
10,275,000
,
and telegraph
public utilities
other
private
109,167,000
83,085,000
10,225,000
——
Railroad
Aug. 2
-
*
93
17
466
191
—
utilities
Other
Stocks
FAILURES
88
—
Telephone
Public
SYS¬
1(H)
kwh.)_
000
1,161
90
!
recreational
construction
$251,875,000
July 28
-July 28
July 28
INDEX—FEDERAL
=
810
Miscellaneous
$267,571,000
158,404,000
INSTITUTE:
(in
and
Military and
Highways
(tens)
SALES
TEM—11)35-81) AVERAGE
1,269
815
i
.
Hospital and institutional
MINES):
OF
(tons)
DEPARTMENT
819,875
Aug. 2
;
Pennsylvania anthracite (tons)
Beehive coke
July 28
Aug. 2
—
.
OUTPUT
2,016
914
building
Educational
NEWS-
.—
municipal
Federal
COAL
1,824
922
'
Residential
construction
and
$2,696
1,858
(nonfarm)
Religious
July 28
Aug. 2
construction
State
$2,702
Warehouses, office & loft buildings.
Stores, restaurants, and garages
All
CONSTRUCTION
RECORD:
Total U. S. construction
Private
Ago
$2,790
(nonfarm)
Other nonresidential
Public
Revenue freight received from connections (number of cars)
Public
Month
Commercial
Farm
OF AMERICAN RAILROADS:
Revenue freight loaded (number of cars).
ENGINEERING
Year
Month
(in millions):
Nonhousekeeping
building
6,165,700
ASSOCIATION
CIVIL
OF
date:*
Previous
dwelling units
Additions and alterations
42
of
__
to
runs
output
DEPT.
of that
are as
New
INSTITUTE:
condensate
S.
either for the
are
Latest
construction
Residential building
AMERICAN
of quotations,
cases
Year
Total
castings (net tons)
production and other figures for the
cover
%
latest week
2.67
Cotton
silks
wash
goods
——*
—
116.7
113.0
157.1
156.0
138.3
161.9
162.5
146.6
197.0
197.1
167.3
Domestics—
.Aug. 7
467.0
465.0
481.9
Sheets
461.3
—
Blankets
NATIONAL
PAPERBOARD
Women's
ASSOCIATION:
and
comfortables
(tons) —j.—July 28:
Production (tons)
July 28
Percentage of activity
—.—July 28
Unfilled orders (tons) at end of period
—July 28
181,072
176,346
221,045
248,508
Aprons
and
231,788
225,732
244,242
and
94
103
21a,yU9
96
Corsets
97
537,591
589,330
547,963
524,391
Underwear
—
—
houscdresses
AND
AVERAGE
=
DRUG
REPORTER
100
PRICE
Men's
INDEX —1926-30
148.2
3
———————2—..Aug.
148.4
150.0
——
—
—
—
—
—
Underwear
Shirts and
STOCK TRANSACTIONS
LOT
DEALERS
FO(R THE
AND
Odd-lot
'
sales
by dealers
ON
EXCHANGE
(customers'
Number of orders
Number of
:
ODD-LOT ACCOUNT
SPECIALISTS
EXCHANGE—SECURITIES
THE
N.
OF
Y.
*i.—........
of
by dealers
(customers'
orders—Customers'
short
sales
Customers'
other
sales.—
of
Number
'
26,927
25,428
27,026
40,021
769,249
710,236
750,440
1,182,756
$34,542,153
$32,380,715
$34,973,167
$49,920,752
total
July 21
22,682
21,044
22,709
29,716
July 21
604
404
176
321
sales)—
short
sales
Customers'
other
sales
...
July 21
July 21
22,078
21,448
22,533
29,395
625,726
572,416
606,741
890,064
22,166
14,706
6,654
12,116
.——July 21
603,560
557,710
600,087
877,948
value
July 21
$26,161,921
$23,080,128
$26,320,496
$33,474,526
——
...
...
—
—
—....
Short
sales
Other
sales
Round-lot
of
...
—
purchases
Number
July 21
...
by
shares
174,960
137,030
176,020
.
PRICES, NEW SERIES
—
U.
S.
DEPT.
OF
Floor
Grains
*■
...
174,960
—:
—;
Luggage
:—
commodities
July 31
other
...
...
than
farm
and
lighting materials—*
Metals and
Building
foods
—
...
metal products
materials
....
...
Lumber
Chemicals
>
"Revised,
household
appliances
——
FACTORY
and
fNot
allied
products
available.
filncludesl
.
595,000
barreis
of
137,030
176,020
320,660
291,140
209,540
All
ESTIMATE —U.
of
134.0
V
141.9
137.8
137.9
133.2
150.8
150.8
140.8
148.0
148.0
140.9
166.7
166.2
152.2
134.7
134.4
129.5
127.9
127.9
135.3
135.2
131.3
185.5
186.0
167.7
127.2
132.8
132.8
130.4
123.0
123.0
118.9
160.3
160.3
143.5
158.1
147.1
193.3
193.5
162.7
126.2
126.3
117.9
135.0
135.3
128.3
148.8
148.7
138.4
136.3
136.3
132.9
S.
DEPT.
OF
June:
485,725
$65.44
manufacturing
goods
Nondurable
—*—
goods
—
—
177.3
178.0
189.9
"189.0
180.2
197.6
165.8
179.3
goods
goods
62.86
53.93
*40.7
41.9
41.7
39.4
*39.3
$1,604
*$1,586
40.5
41.3
39.5
.
Hourly earnings—
All
manufacturing
goods
177.0
176.5
169.5
Durable
260.8
265.0
246.4
Nondurable
186.0
"185.0
187.2
174.7
257.9
July 31
275.3
274.4
275.6
167.4
167.7
168.5
154.3
OF
175.7
175.5
177.4
148.8
(000's
..July 31
July 31
137.7
137.7
138.6
134.1
Ordinary
188.2
188.2
188.2
173.5
Industrial
July 31
July 31
224.2
224.2
224.4
211.2
Group
350.2
350.2
349.8
%
July 31
139.0
138.2
137.7
121.7
runs.
$58.85
69.39
*58.01
40.8
manufacturing
177.2
-
*$64.55
70.60
58.63
Hours—
July 31
crude
130.8
146.7
209,540
July 31
foreign
144.9
142.9
EARNINGS AND HOURS—WEEKLY
'.'" 264.0
...
....
pioducts
Fuel and
(
Electrical
Durable
....^.July 31./'
.July 31
...
—.
Meats
Textile
—
Durable
318,500
July 31
July 31
—;
Livestock'——
Foods
All
coverings
China
LABOR—
_
■
—
Nondurable
Farm products
'
;
—
Radios
1926=100:
All commodities
144.9
148.4
wear—
;
Shoes
''v.;
July 21
...
143.1
102.1
Earnings—
July 21
1
children's
Socks
Underwear
All
WHOLESALE
and
LABOR—Month
..July 21
.....
——
dealers—
—
-
-
AVERAGE
Round-lot sales by dealers—
Number of shares—Total sales.
174.7
107.7
143.0
158.1
..July 21
...
Li.—.
caps
including overalls
'
/
sales
shares—Total sales
Customers'
Dollar
July 21
.July 21
—July 21
„_
Customers'
and
neckwear
Shoes
Infants'
shares
purchases
Number
Hats
Clothing
purchases)—
Dollar value
Odd-lot
ODD-
STOCK
COMMISSION:
f
apparel—
Hosiery
126.7
-
brassieres
Shoes
PAINT
174.9
—
apparel—
106.6
Orders received
OIL.
.—
LIFE
INSURANCE
1.664
1.522
"1.476
1.365
———$l,48o,OCO
$1,522,000
$1,426,000
-3225
505,000
454,000
33o,000
401,000
423,000
$2,295,000
$2,428,000
$2,303,000
——
PURCHASES
—
INSTITUTE
INSURANCE —Mcnth
LIFE
$1,453
1.635
1.488
—
goods
of
|
June
omitted):
^„-nrrt
—
———
|_.
-—~~— >——————
Total
*Revised
figures.
tNot shown to
,
avoid disclosure
of individual operations.
A
Chronicle
The Commercial and Financial
34
.
.
Thursday, August 9, 1951
.
(534)
* REVISIONS THIS WEEK
Securities Now in Registration
common
New
Registrations and Filings
(letter of notification) 108,856 shares of 6/4%
cumulative preferred stock (par $2.40) and 108,856 shares
of common (voting) stock (par five cents) to be offered
in units of one share of preferred and one share of
common
stock.
Price—$2.50 per unit.
Underwriter1
National Corp., New York.
Proceeds
working capital and general corporate purposes.
—306 Broadway, New York, N. Y.
—For
Office
Empire
American Trailer Co.,
Inc., Washington, D.
C.
(letter of notification) $120,000 of 5Vz% first
mortgage bonds, due Aug. 1, 1961. Price—At 100%%
and accrued interest (in units of $1,000 each).
Under-*
writer—Mackall & Co., Washington, D. C.
Proceeds—
Street,
Eastern
To pay
off present indebtedness and for additional
working capital. Office—4030 Wisconsin Avenue, N. W.,
Washington, D. C.
Colo.
July 27 (letter of notification) 25,000 shares of common
stock
(par $1).
Price—$2 per share.
Underwriter—
None.
Proceeds—For drilling oil wells, repayment of
loan to driller and for current obligations.
Office—
Petroleum
Co.,
Denver,
.
Denham
Country Club, Inc., Bethesda, Md.
(letter of notification) $75,000 of certificates of
third mortgage bonds. Under¬
writer—None. Proceeds—To finance purchase, at a dis¬
Bethesda
July 31
beneficial interest in 5%
count, of $115,000 third trust bonds outstanding.
Central Chemical Corp.,
Hagerstown, Md.
July 31 (letter of notification) 24,000 shares of 6% noncumulative preferred stock (par $10) and 6,000 shares
of non-voting common B stock (no par). Price—$10 per
share.
Underwriter
None.
Proceeds — For working
—
capital.
Chicago Magazine Corp., Chicago,
III.
Aug. 3 (letter of notification) 600 shares of class A stock
(par $25) and 5,950 shares of commton stock (par 50
cents), of which it is intended to offer to 25 or less
individuals 550 class A shares and 2,200 common shares
the
class A and four
shares will
common
of
one
be
shares; 3,500
Maurice English, one
common
issued to
incorporators
proposed
of
the
corporation,
in
exchange for property and services; and .50 class A
shares
and
250
individuals
cents
in
common
shares
will
be
issued
to
two
advanced by them.
A, $100 per share; and of common, 50
share.
Underwriter — None.
Proceeds — 'To
Price—Of
payment
for
funds
class
per
incident to operation, development and
promotion of magazine. Office—231 So. La Salle Street,
Chicago, 111.
pay
expenses
Coca-Cola
Bottling Co. of St. Louis
July 27 (letter of notification) 1,192 shares of capital
stock (par $1) to be offered for subscription by em¬
ployees.
Price —$24 per share.
Underwriter — None.
Proceeds—For general corporate purposes. Office—2930
N. Market
Street, St. Louis, Mo.
Colo-Kan
Aug. 2
common
None.
Fuel
Corp., Denver, Colo.
Proceeds—For
purchase of oil and gas lease,
wells, and general working capital.
Office—711 E. & C. Bldg., Denver, Colo.
of
new
Columbus
& Southern Ohio Electric Co.
(9/5)
8 filed $12,000,000 of first mortgage bonds, due
1981.
Underwriter—To be determined by competitive
bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
Dillon, Read & Co. Inc.; The First Boston Corp.; Mer¬
Aug.
rill
Lynch, Pierce, Fenner & Beane; Lehman Brothers;
White, Weld & Co. Proceeds—To repay bank loans and
for construction purposes.
Bids—Expected to be re¬
ceived
Sept. 5.
on
Consolidated Gas
Aug. 3
stock
(letter of
(par $1).
—None.
change
Norman
Utilities Corp.
notification) 1,000 shares of
Price—$11.50
Stock to be sold
or
on
over-the-counter
per
share.
market.
common
Underwriter
the New York
Curb
Proceeds
Ex¬
—
To
Hirschfield, President, the selling stockholders.
Office—Braniff Bldg., Oklahoma City, Okla.
Dehydration, Inc., Gloucester, Mass.
July 26 (letter of notification) $11,826 of 4Vz% promis¬
sory notes (in multiples of $3), dated Sept. 1, 1951 and
due Sept. 1, 1954, with transferable stock
purchase war¬
rants for purchase of common stock,
(no par) to be is¬
sued to all subscribers of notes
entitling holder to pur¬
chase at any time up to Sept.
1,
made
Bottling Corp.
Aug.
to
be
Union
Co.,
plan."
Proceeds—For
general
Shares,
Industry
price*—At
Sheeld, Inc., Dallas, Tex.
Associates, Inc. above.
Spartan Grocers, Inc., Los Angeles, Calif.
(letter of notification) 15,000 shares of common
Price—$10 per share. Underwriter—Nohe. Pro-'
Aug. 3
stock.
(par $1).
Allen
ceeds—For
Asso¬
1954,
one
share
of
Pittsburgh
San Francisco
Private Wires
to
all
offices
Chicago
Cleveland
/
3549,
...
expansion
and
operating
Spencer Chemical Co., Kansas City, Mo. (8/27)
Aug. 3 filed 125,000 shares of cumulative convertible1
second
.
<
t
preferred stock (par $50) to be offered to com¬
in ratio of one share of
preferred,
stockholders
mon
.
eight common shares held (stockholders will'
vote on approving new issue on Aug. 15).
Price—To
be
supplied by amendment.
Underwriters — Morgan
Stanley & Co. and Glore, Forgan & Co., New York.
for
each
Proceeds—From
sale
of
stocky together with $5,100,000
from institutional investors,
cost of construction of new
will be used to
chemical
of»
pay part
works.
Tabernacle
Kaman
Aircraft Corp.,
Windsor Locks, Conn.
17,021 shares of class A
(non-voting common stock (no par), of which 171 shares
are to
be offered at $6 per share to four stockholders
who failed to receive notice of their right to subscribe
July 26 (letter of notification)
offering made in February, 1951; 15,742 shares to
to certain employees at $1 per share as part
of !an? employees' bonus plan; and 1,108 shares to be
offered to certain employees at $7 per share in exchange
for a contingent money obligation to such employees
based upon past sources. Proceeds—For working capital.
an
be offered
Office—Bradley Field, Windsor Locks, Conn.
Keever Starch
July 26
stock
S.
(letter of notification) 50,400 shares of common
stock.
Price
At par ($5 per share).
Underwriter—
None. Proceeds—To finance inventories and to purchase
capital equipment. Office—538 E. Town St., Columbus,
—
Corp., Miami, Fla.
of notification) 500 shares of common
par). Price—$100 per share. Underwriter— <
(letter
(no
None.
Proceeds—To
W.
11th
stock
to
be
offered
Co., Athens, Ohio
(letter of notification) 2,500 shares of 5% first
preferred stock. Price—At par ($100 per share). Under¬
writer—Roy E. Hawk & Co., Athens, O. Proceeds—For 1
working capital.
Montana-Canadian Oil
Corp., New Orleans, La.
July 31 (letter of notification) 98,000 shares of com¬
mon stock
(par 10 cents). Price—$3 per share. Under¬
writer—S. B. Cantor Co., New York. Proceeds—To drill
and complete wells and for working capital. Office—811
Maritime Bldg., New Orleans, La.
/
,
-
New
England Gas & Electric Ass'n (9/3-8)
Aug. 6 filed $6,115,000 of 20-year sinking fund collateral
trust
bonds, series C, due 1971.
Underwriter—To be
determined by competitive bidding.
Probable bidders:
Halsey, Stuart & Co. Inc.; The First Boston Corp.; White,
Weld & Co. Proceeds—To purchase additional common
stocks of five subsidiaries.
Offering—Expected week
for
subscription by
Price—10 cents per share.
Office—2147
,
*
•
common
common
Underwriter—None.
—For
working capital, etc.
Asbury Park, N. J.
stock¬
Office—1001
Proceeds
First Avenue,
Viking Plywood & Lumber Corp., Seattle, Wash.
July 9
(letter of notification) 37,500 shares of
stock (no
to
common
par), to be sold in minimum units of 125 shares
present
mit
McBee
building.
holders of record Aug. 9 in ratio of eight shares for each
nine shares held, with an oversubscription
privilege.-
officers, directors and stockholders.
$20 per share.
Aug. 3
construct
Street, Miami, Fla.
Trad Television Corp.
(8/13)
Aug. 7 (letter of notification) 2,000,000 shares of
Co., Columbus, Ohio
Aug. 1
Underwriter—None.
acquisition
of
50%
of
Lumber
Co., Eugene, Ore.
Building, Seattle, Wash.
Price—
Proceeds—To per¬
capital stock of Snellstrom
Office—1411 Fourth Avenue
Wailingford (Conn.) Power & Equipment Co., Inc.
July 25
stock.
(letter of notification) 100 shares of preferred
Price—At par ($100 per share).
Underwriter—
None,
but
President.
may
be
sold
through
Proceeds—For
Glen
working
E.
Hildebrand,
capital.
Wilson
Brothers, Chicago, III. (8/28)
sinking fund debentures
Aug. 1, 1966, with non-detachable common share
purchase warrants for the purchase of 154,000 shares of
•-
Aug. 3 filed $2,200,000 of 5%
due
common
stock.
Price—To
be supplied by amendment.
Rollins & Co., Inc., New York.
off outstanding indebtedness and for
Underwriter—Blair,
Proceeds—To
pay
other corporate purposes.
Previous Registrations and
Filings
/<
of Sept. 3.
Newman Associates,
Inc. (name to be changed
Sheeld, Inc.), Dallas, Tex.
July 30 (letter of notification) 10,000 shares of preferred
to
stock
two
five
(no par) and 50,000 shares of common stock (par
cents) to be offered in units of one preferred and
common
shares.
for account of
Hal
This includes 33,000 common shares
C. Newman, President of the com¬
Price—$10.10 per unit. Underwriter—Southwest¬
ern Securities Co., Dallas, Tex.
Proceeds—To purchase
assets of Sterling Industries, Inc., to retire bank loans
and
pay
accounts payable, and for working capital.
Office—1400 Marilla St., Dallas, Tex.
pany.
Northwest Plastics,
Boston
Address—Box
Office—2807 Central Avenue, Birmingham, Ala.
capital.
Mo.
to
Proceeds—For
amendment.
Office—412 W. 39th St., Kansas City,
purposes.
warehouse.
Aug.
Hex
Foods, Inc., Kansas City, Mo.
Aug. 1 (letter of notification) 89 shares of 6% cumulative preferred stock (par $100) and 424 shares of com¬
mon stock
(no par). Price—For preferred, at par; and
for common, at $20 per rshare. Underwriter — Prugh,
Combest & Land, Inc., Kansas City, Mo., will act as
dealer.
Proceeds—For plant improvements and general
to
Los Angeles.
Specialized Products Corp., Birmingham, Ala. ; )
2 (letter of notification) 5,000 shares of capital
stock. Price—$10 per share. Underwriter—None. If issue
is to be underwritten later, names will be supplied byv
Helio Aircraft Corp., Norwood, Mass.
31 (letter of notification) 7,750 shares of noncumulative preferred stock
(par $1) and 7,750 shares
of common stock (par $1) to be offered in units of one
share of preferred
and one share of common stock,
price—$25 per unit ($20 for. preferred and $5 for com¬
mon). Underwriter—None. Proceeds—For development
and promotion expenses.
Office—Boston Metropolitan
Airport, Norwood, Mass.
'
_
corporate
addition
Terminal Annex,
Proceeds—For investment.
ciates, Chicago, 111.
.
See Newman
Inc.
Underwriter—Harland
market.
purchase and/or rental of operating facil¬
electronic test equipment, machine tools, and
fields.
lated
corporate
(Md.)
July*30 filed 50,000 shares of capital stock
Growth
as
pertaining to guided missiles, electronics, and re¬
Office—135 Bacon St., Waltham, Mass. *
tracts
$10)
Office—*-50 Church St., New York.
purposes.
* *■
'
equipment and for working capital to enable the
office
Philip O. Krumm (President)), Jerome J.
Kahn (Vice-President) and Kenneth C. Prince. (Sec¬
retary-Treasurer), who are the selling stockholders.
Office—1 East Main Street, Niles, Mich.
ities such
stock
Price —To be supplied by amendment.
Underwriter—None.
1
-
taking and completing of prime government and sub-con¬
7 filed 64,000 shares of common stock (par
issued pursuant to an "employees' restricted
option
■
Inc., Waltham, Mass. v
(letter of notification) 60,000 shares of class A
stock. Price—$5 per share. Underwriter—None.
Proceeds—For
New York
ceeds.—To
Philadelphia
common
Office—615 Adams St., Hoboken, N. J.
Grand
Sept. 24.
on
Aug. 2
ing will be made of 15,000 shares. Price—$1 per share.
Underwriter—None.
Proceeds—For general corporate
purposes.
capital.
working
Sanders Associates,
Aug. 7 (letter of notification) 250,000 shares of common
stock, of which 75,000 shares are to be issued to three
officers (25,000 shares each) and an initial public offer¬
Underwriter—None. Pro¬
Offering—Expected to be
Price—$14.50 per share.
ceeds—For
Niles (Mich.) Cabinet Co., Inc.
'
\
July 28 (letter of notification) 49,998 shares of cdmmon
stock.
Price—$2 per share. Underwriter—None. Pro¬
New York.
of
held.
Ohio.
(letter of notification) 75,000 shares of class A
stock.
Price—$1 per share.
Underwriter—
drilling
stock
July
Building, Colo.
in units of
Caramba
(9/24)
20,587% shares of common
(par $12.50) to be offered to common stockholders
record Sept. 21 at rate of one share for each 12 shares
Aug. 2 (letter of notification)
Mass.
Gloucester,
INDICATES ADDITIONS
Ltd., Oneida, N. Y.
Oneida,
held at
total of 1,358 shares). Under¬
writer—None. Proceeds—Primarily for defense of law¬
suits against company and its President brought
by
Schenley Farm Products Co., Inc. Office—17 Pleasant
July 26
Barton
$9 of promissory notes
$1 per share (calling for a
(8/9-10)
Communications Corp.
American
Aug.
stock for each
•
Inc., St. Paul, Minn.
Aug. 3 (letter of notification) $100,000 of 6% 15-year
convertible sinking fund debentures and 12,000 shares
of common stock (par $2.50). Price—Of debentures, at
par; and of stock, $8.75 per share.
Underwriters—M. H.
Bishop & Co., Minneapolis, Minn., and Irving J. Rice &
Co., St. Paul, Minn. Proceeds—To retire bank loans and
mortgage debt and for working capital. Office—65 Plato
Ave., St. Paul, Minn.
Alabama Flake Graphite Co., Birmingham, Ala.
July 12 (letter of notification) $100,000 of 7% 20-year
sinking fund bonds dated Jan. 15, 1949 and due Jan. 15,
1969
(in denominations of $1,000 each). Price—At
par.
Underwriter—Odess, Martin & Herzberg, Inc., Birming¬
ham,
Ala. Proceeds—For plant
Bldg., Birmingham. Ala.
expansion.
Office—420
Comer
*
1
★ All American Casualty Co., Chicago, 111.
July 26 filed 1,000,000 shares of common stock (par $1).
Price-|$3 per share. Underwriter—May be M. A. Kerh,
President. Proceeds—To increase capital and surplus.
Atperican Bosch Corp., Springfield, Mass. '
May B7 filed 98,000 shares of common stock (par $2).
Price|r-At the market (approximately $15 per share).
Underwriter—None. Proceeds—To' Allen & Co. (owner,
19|,000 shares, or 15.1% of outstanding shares). State¬
ment
^effective July 3.
*
of
American
Brake Shoe Co.
Junef29 filed 50,000 shares of
common
be offered to certain officers and
a
stock
purchase plan.
stock (no par) to
key employees through
Price—To be not greater than
the itiarket price on the date of the offering, or no less
than* 85% of such price. Underwriter—None. Proceeds
—To|be added to general funds.
American
Mucinum,
Inc., N.
Y.
(8/15)
July"17 (letter of notification) 1,000.000 shares of class
A stock;
Price—At par (15 cents per share).
Under-
Volume 174
Number 5036
.
.
The Commercial and Financial Chronicle
.
35
(535)
writer—To be supplied by amendment.
Proceeds—For
operating expenses. Office—27 West 72nd Street, New
York 23, N. Y.
Arden Farms
The
NEW ISSUE CALENDAR
Co., Los Angeles, Calif.
July 6 at rate of
with
one
rights to expire
share for each 4V2
August 9,
shares held
Stores, Inc._____>
Trad Television Corp
stock
Common
of), Canada
Bonds
stock
$5,000. of notes and 500 shares
August 21, 1951
class
(20 units to be offered in exchange for
$100,000 of short-term
notes). Price—$5,000 per unit. Un¬
derwriters—Mason. Moran & Co., and Cruttenden &
Co.,
both of
Chicago, 111. Proceeds—To drill wells. Office—
National Distillers Products Corp
Preferred
Seaboard Air Line RR
Bonds and Stocks
419
Foote Bros. Gear & Machine
ville, Ind.
11
Bigelow-Sanford Carpet Co., Inc.
May 16, filed 100,000 shares of 4V2% cumulative pre¬
ferred stock, series of 1951
(par $100), of which 39,604V2
issuable
are
to
holders
of
26,403 shares
of
Common
Spencer Chemical Co.-
P00 shares of
Wilson Brothers
to
new
conditions.
F.
Jetter &
pur¬
11
(Neb.)
Telephone Co.
July 18 (letter of notification) $175,000 of first mort¬
gage 4% bonds, series A, due 1971. Price—101 and ac¬
crued
interest.
Underwriter
New
Wachob-Bender
3^% bonds and to convert
1951
England Gas & Electric Ass'n
preferred
Bonds
York.
Bonds
with
Harshaw Chemical Co
$1,500,000
October 29,
Utah Power &
Light Co.,
JBonds
noon
(EST)
—Bonds
and A. E. Ames &
March 5 filed 300,000 shares of convertible
preference
.stock (par $100). Price—To be supplied by amendment.
Underwriter—Kidder,
Peabody
&
Co.,
New
York.
Proceeds—For additions and improvements to
plant and
equipment. Offering date postponed.
Canam
Copper Co., Ltd., Vancouver, CanadarApril 20 filed 200,000 shares of capital stock. Price—At
par ($1 per share). Underwriter—Harry M. Forst. Pro¬
ceeds—For exploration and development work.
'
Carolina
North
Mountain
Carolina
Telephone
s
.,
Co.,
Weaverville,
,
July 13 (letter of notification) 100,000 shares of capital
stock (par $1) being offered to stockholders on
basis of
share for
one
each
two shares
held
July 23; with
rights expiring on Aug. 24. Price—$2.15 per share. Un¬
derwriter—Interstate Securities Corp., Charlotte, N. C.,
and four others.
.
Gearhart, Kinnard & Otis, Inc., New York. Proceeds—
Burlington Mills Corp.
on
Proceeds—To retire loans.
Central Fibre Products
Co., Quincy, III.
>
June 11 (letter of notification)
3,000 shares of non-voting
common stock
(par $5). Price—At the market. Under¬
For
working
capital
and
general
corporate
purposes.
Temporarily deferred.
Proceeds—To retire indebtedness and for
working capi¬
Offering—Postponed indefinitely.
& Co., Denver, Colo. Pro¬
selling stockholders. Office—901 S. Front
ceeds—To two
stockholders of record June 30, 1951, on a one-for-five
basis, with an oversubscription privilege; rights to expire
on Oct. 1. Price—30 cents
per share. Underwriter—None.
Proceeds—For working capital. Office—824 Old National
Bank Bldg., Spokane, Wash.
St., Quincy, 111.
/1f--
Checker Cab
;
-
Manufacturing Co.
June 28 filed 433,444 shares of
common
-
\
'•
.
.
■
,>
.:/;«
stock (par $1.25)
being offered for subscription by common stockholders
record July 31 at rate of one new share for
each
share held; rights to expire on Aug. 16.
Price—$5 per
share.
Underwriters—None. Proceeds—To repay loans
of
and
for
additonal
working capital.
■' " v ,/■.,/
July 25.
* Chevron Petroleums,
Ltd.,
Statement effective
/
Toronto,
Canada
March 14 filed
to
900,000 shares of common stock (par $1)
a
speculation." Price —50 cents per
Underwriter—Willis E. Burnside & Co., Inc., New
be
offered
share.
York.
"as
Proceeds—To take ur> ontion and develop prnr>Withdrawal
Registration statement was with¬
drawn on July 26.
erties.
—
Consolidated
July
10
(letter
Equipment Corp.
notification) 300,000
of
cumulative
of
6%
preferred stock.
Price
At
par
($1 per
Underwriter—None. Proceeds—For purchase of
dispensing machines. Office—105Vz East Pike
Peak Avenue, Colorado
Springs, Colo.
—
share).
Continental
Car-Nar-Var Corp., Brazil, Ind.
(letter of notification) 150,000 shares of com¬
mon (voting) stock
(par $1). Price—$2 per share. Under¬
writers—Sills, Fairman & Harris, Inc., Chicago, and
5
(par 10 cents).
writer—None.
219
Price—70 cents per share.
Proceeds—To
pay
obligations.
Under¬
Office—
Fidelity Bldg., Oklahoma City, Okla. Offering—Tem¬
porarily postponed
"because
of
market
conditions."
(letter of notification) 50,000 shares of common
(par 40 cents). Price—$1.20 per share. Under¬
writer—Edgerton, Wykoff & Co., Los Angeles, Calif.
Proceeds—To purchase real property and plant.
stock
Financial Credit Corp., New York
July 27 (letter of notification) $250,000 of Financial in¬
vestment bonds.
Price—At par (in units of $50, $250,
$500 and $1,000 each). Underwriter—None.
Proceeds—
To pay obligations, for expansion and working capital.
Office—60 East 42nd Street, New York
17, N. Y.
Fleming Co., Inc., Topeka, Kansas
July 27 filed 5,000 shares of 5% cumulative preferred
stock (par $100)
and 15,000 shares of common stock
offered for
common
stock
are
period of 10 days to common stock¬
holders, officers and employees and 2,000 shares of pre¬
ferred and 6,000 shares are to be offered
publicly to¬
gether with any of the unsubscribed 3,000 common
shares.
The
a
underwriters
have
option
purchase
the preferred at $100 per share and the common at $36
per share.
Price—On exercise of rights, $36 per share
for
an
to
common, and to public at not exceeding $103
share for the preferred and $37.50 per share for
common
stock.
June
30
with
an
basis of one share for each 14 shares held,
oversubscription privilege; rights to expire on
Aug. 15. Price — $20 per share. Underwriter — None.
Proceeds
To repay bank loans.
Office—500 Carlton
Bldg., Box 86, Colorado Springs, Colo.
»
■
on
Hartford
Special Machinery Corp.
per
;
July 24 (letter of notification) 5,000 shares of
stock
<
common
to be offered for subscription
by present stock¬
oh a pro rata basis.
Price — At par ($20 per
share).
Underwriter—None.
Proceeds—For additional
working capital. Office—287 Homestead Ave., Hartford,
holders
•
it Hilton Hotels Corp., Chicago, III.
March 30 filed 153,252 shares of common stock
(par $5)
now
offered to holders of
dorf-Astoria
common
stock of Hotel Wal¬
Corp. in exchange
for their holdings
such stock on a share-for-share
basis; offer expires
Aug. 27. Dealer-Manager—Carl M. Loeb, Rhoades
Co., New York.
of
on
&
Household Service, Inc., Clinton, N. Y.
July 26 (letter of notification) $25,000 of first mortgage
bonds due May 1, 1965.
Price—At par (in units of $100
each). Underwriter—Mohawk Valley Investing Co., Inc.,
Utica, N. Y.
for
working
June
June 4
to be
Proceeds—To The First National Bank of
Proceeds—To repay short-term loans and
capital.
Idaho Custer Mines,
Drayson-Hanson, Inc., Los Angeles, Calif.
(par $25), of which 3,000 shares of
shares
soft drink
March
Deardorf Oil Corp., Oklahoma
City, Okla.
May 18 (letter of notification) 200,000 shares of common
stock
1
it Golden Cycle Corp., Colorado Springs, Colo.
•July 17 (letter of notification) 14,841 shares of common
stock (par $10) being offered to stockholders of record
Conn.
Cornucopia Gold Mines
May 14 (letter of notification) 229,800 shares of common
stock (par five cents) being offered for
subscription by
v
writer—Bosworth, Sullivan
on
after
—
Continental Electric Co./ Geneva, III.
March 2 (letter of notification)
$300,000 of 6% sinking
fund debentures due Dec. 1, 1975
(to be issued in units
of $100, $500 and $1,000 each). Price—91% of
principal
amount. Underwriter—Boettcher &
Co., Chicago, III
tal.
until
Golconda Mines Ltd., Montreal, Canada
April 9 filed 750,000 shares of common stock.
Price—
At par ($1 per share).
Underwriter—George F. Breen,
New York.
Proceeds—For drilling expenses, repayment
of advances and working capital. Offering—Date not set.
1951
Co., Inc. Proceeds—$26,300,000 to pay
treasury bills, and $8,700,000 for construction program.
expected
as Trustee for the Estate of Owen L. Coon. Of¬
fice—184 West Lake St., Chicago 1, 111.
1951
Arkansas Power & Light Co
Aug. 15, 1956; $1,500,000 on Aug. 15, 1957;
and $26,000,000 on Aug. 15, 1976). Price—To be.
supplied
by amendment.; Underwriters—The First Boston Corp.
Offering—Not
per
Chicago
Common
on
stock, together
to repay $2,000,000 out¬
16, 1954, and to redeem
Finance
writer—None.
September 24, 1951
October 9,
March
Corp., Chicago, III.
July 3 (letter of notification) 46,153 shares of common
stock (par $1), to be offered to employees, officers and
directors of company.
Price—$6.50 per share. Under¬
Preferred
Oneida, Ltd,
(Province of), Canada (8/16)
July 27 filed $35,000,000 of debentures (in U. S. dollars
"and maturing as follows:
$6,000,000 on Aug. 15, 1955;
program.
General
September 20, 1951
British Columbia
notes due
Labor Day.
Equip. Trust Ctfs.
mon/$50 per share; and of preferred, at par ($20 per
share).
Underwriter — None.
Proceeds
For work¬
ing capital. Office—2817 Laclede Avenue, St. Louis 3,
Missouri.
Proceeds—From sale of preferred
other funds, will be used
financing
September 19, 1951
Utah Power & Light
Co., 11 a.m. (EDT)—Common
—
(par $15).
Price—To be supplied by
Underwriter—F. Eberstadt & Co., Inc., New
36,799 shares of outstanding preferred stock at $5.50
share.
Meeting—Stockholders will vote Aug. 10
—Bonds
to be offered to residents of Missouri
only first to com¬
mon
stockholders and then to public.
Price—Of com¬
/
stock
standing 4%
September 12, 1951
held, and 1,500 shares of 5% cumulative preferred stock
—
(D. B.)
amendment.
Chesapeake & Ohio Ry.
Noon (EDT)
option is delivered to the employee.
Proceeds
For working capital.
& Co., Inc., N. Y.
July 26 filed 120,000 shares of 6% cumulative convertible
September 11, 1951
Copper Sales Co., St. Louis, Mo.
(letter of notification) 2,807 shares of common
stock (par $10) to be offered to common
stockholders of
record July 9 at rate of one share for each
five shares
3
it Fuller
1951
Alabama Power Co
Brass &
July 9
Common
September 3,
Columbus & Southern Ohio Electric Co
retire first
Detroit, Mich.
Statement effective July 17.
v
Corp.,
mortgage (closed)
to dial operation.
—
Underwriter—None.
Products, Inc.
September 5,
con¬
Price—At 85% or 95% of the highest sale
price of the stock on the New York Stock Exchange on
the day on which the
(EDT)
a.m.
:
.
Omaha, Neb. Proceeds—To
Scheerer
equip frozen
tion plans."
Bonds
Debentures
August 29, 1951
S.
poses.
Blair
Fruehauf Trailer Co.,
Underwriters—Harriman
Jtipley & Co., Inc.; Kidder, Peabody & Co., and
Moseley & Co. Proceeds—For general corporate
and
June 15 filed 115,000 shares of common stock (par $1), to
be "offered to certain employees pursuant to stock op¬
/Bonds
Southern Counties Gas Co. of California
preferred stock has been deferred due
market
present
construct
McKinnon, Chicago, 111. Proceeds—To Frank
Fox, the selling stockholder. Office—2626 W. Monroe
St., Chicago, 111.
Preferred
Southern California Edison Co
Proceeds—To
plant at Forest City, Fla.
Thomson &
August 28, 1951
preferred stock on the basis of IV2 shares for each
pre¬
ferred share held. Public
offering of the additional 60,-
(par
G.
August 27, 1951
6%
(Fla.)
stock
common
Fox (Peter) Brewing Co., Chicago, III.
July 24 (letter of notification) 5,000 shares of common
stock (par $1.25). Price—$7.75 per share. Underwriter-
Corp.
(CDT)
a.m.
shares of class A
(par $50); and 4,000 shares of 4% revolving fund
stock (par $25).
Price—At par. Underwriters
centrate
August 22, 1951
Bldg., Second and Sycamore Streets, Evans¬
453
C
—None.
.
shares
Fosgate Citrus Concentrate Cooperative
29 filed
per
cor¬
Statement effective June 29.
$100); 5,706 shares of 5% class B preferred stock (par
$100), cumulative beginning three years from July 10,
1950; 8,000 shares of 4% revolving fund class C stock
(par $100); 2,000 shares of 4% revolving fund class C
August 16, 1951
of stock
Grein
}
June
___Class A
British Columbia (Province
(par 10 cents)
New York Stock Exchange
(about $34.50
Underwriter—None. Proceeds—For general
on
porate purposes.
August 15, 1951
Corp., Evansville, Indiana
July 16. (letter of notification) $250,000 of 6% convert¬
ible sinking fund notes dated
July 1, 1951 and July 1,
common
Preferred
American Mucinum Inc
&
Machinery & Chemical Corp.
share).
Pacific Western
Oil
1956, and 25,000 shares of
to be offered in units of
ket
August 13, 1951
24; unsubscribed shares
to be offered
publicly. Price—$45 per share. Underwriter
-—None. Proceeds—To
repay bank loans. Statement ef¬
fective July 6.
Basin
Estes
June 13 filed 100,000 shares of common stock (par $10)
to be offered to employees. Price—To be based on mar¬
American Communications
Corp.__Pfd. & Common
Sept.
on
For
1951
Securities
Corp.; Seltsam-Hanni & Co.,
Co., all of Topeka, Kan. Proceeds—
working capital.
and
Food
June 11 filed 55,000 shares of
$3 cumulative and partici¬
pating preferred stock (no par) of which 54,444 shares
are first
being offered to preferred stockholders of rec¬
ord
Columbian
Inc.
8
Inc., Wallace, Idaho
(letter
of notification) 800,000 shares of non¬
assessable common stock (par 10 cents). Price—25 cents
per share.
Underwriter—H. M. Herrin & Co., Seattle,
Wash., and others. Proceeds—For development of Liv¬
ingston mine. Office—Scott Bldg., Wallace, Idaho.
International Resistance Co., Phila, Pa.
June 26
(letter of notification) 1,500 shares of common
stock (par 10 cents).
Price—At the market (approxi¬
mately $6.37y2 to $6.62V2 per share).
UnderwriterStein Bros. & Boyce, Phila., Pa.
Proceeds—To Harry
A. Ehle, Vice-President, who is the selling stockholder.
Interstate Finance Corp., Evansville, Ind.
July 10 (letter of notification) 15,557 shares of common
stock (par $1).
Price —$10 per share. Underwriter —
None. Proceeds—For working capital. Office—405 Syca¬
more Street, Evansville 8, Ind.
♦
Jersey Central Power & Light Co.
Feb. 21 filed $1,500,000 first mortgage bonds due in
1981.
Proceeds—For
expansion program. Bids—Only one bid
by company on March 27, from Halsey,
Stuart & Co. Inc., which was returned unopened. Offer¬
was
received
ing—Postponed
March
indefinitely.
Statement
effective
14.
the
Underwriters—Beecroft, Cole-& Co., Inc.;
Continued
on
page
36
36
Continued
from
...
(par $100). Proceeds—From sale of preferred, together
with proceeds to be received from the sale of 350,000
additional
shares
common
(par $100).
Underwriters—To be determined by competitive bidding.
Probable bidders: Morgan Stanley & Co.; Lehman Bro¬
thers and Bear, Stearns & Co. (jointly); W. C. Langley
6c Co.; Glore, Forgan & Co. and White, Weld & Co.
(jointly); The First Boston Corp. Proceeds — For con¬
struction program. Bids—Indefinitely postponed. Were
to have been submitted up to 11:30 a.m. (EDT) on May 2.
March
Public
General
to
Utilities
Corp., the parent, will be used for new construction.
Bids—Only one bid, from Union Securities Corp. and
Salomon Bros. & Hutzler (jointly), was received March
27, which was returned unopened. Statement effective
March 14. Amendment—On May 8 SEC granted an ex¬
emption from competitive bidding. Preferred may be
privately
placed,
but
reported,
temporarily
aban¬
150,000 shares of pfd. stock
filed
30
Colony Finance Corp., Mt. Rainier, Md.
(letter of notification) $250,000 of 6% sub¬
debentures
with
stock
purchase warrants
attached. The latter will entitle holders thereof to pur¬
chase one share of common stock at $4 per share for .<
Old
June
1
ordinated
doned.
each $100
if Linnton Plywood Association, Portland, Ore.
Aug. 1 (by amendment) filed 188 shares of non-voting
common stock to be offered to employee members. Price
—At par ($5,000 per share). Underwriter — None, but
John J. Oxley and J. A. Williams will solicit subscrip¬
tions. Proceeds—To improve plant site and acquire facil¬
ities and machinery.
nominations of $100, $500 and $1,000 each).
—None.
Proceeds—For working capital.
Los Angeles Drug Co.
(Calif.)
July 23 filed $500,000 of 15-year 5%
of debentures owned.
Rhode Island Avenue,
Facific
Power
expire
000
Price—$14.25
shares of capital stock
(no par), to be offered first
(debentures to be offered are
stockholders
present
be subject to prior issuance to
of
ment
a
dividend
in
and
None.
of
the
Proceeds
at par
stock, $10
—
To
pay¬
of
$300,000).
(in denominations of $100
per share.
Underwriter—
Price—Of debentures,
each)
shareholders in
aggregate
increase
amount
working capital and to
are
(par
$1). Price—$6.87
share.
Underwriter—
Proceeds—To Martin S.
per
Straus & Blosser,
Chicago, 111.
Goldring, a director, who is the selling
Office—235 So. State St., Chicago, 111.
stockholder.
Underwriter
None.
Proceeds
For
working capital.
Office—4383 Bandini Boulevard, Los Angeles 23, Calif.
—
—
Mercantile Acceptance Corp. of California
May 18 (letter of notification) 4,881 shares of first pre¬
ferred stock.
Price—At par - ($20 -per share).
Under¬
writer—Guardian Securities Corp.
Proceeds—For gen¬
eral corporate purposes.
Midwest Packaging Materials Co., St.
Louis, Mo..
10,880 shares of common stock (par $1)
to be issued to Edward D, Jones & Co.
upon exercise
July 17 filed
of warrants to purchase stock at
$5 per share, and then
to be publicly offered. Price—To be
supplied by amend¬
ment.
Mo.
Underwriter—Edward D. Jones & Co., St. Louis,
Proceeds—$50,000 of proceeds from sale of warrants
will
be
used
purchase 500 additional shares of The
Midwest Wax Paper Co., a, wholly-owned
subsidiary,
at $100 per share and the balance used for
general
corporate purposes.
Miles Management, Inc.,
Wallace, Idaho
July 24 (letter of notification) 58,000 shares of
—
Louis
Price—60 cents per share.
Underwriter
Offices—507
Multnomah
Bank Street, Wallace,
Building, Spokane, Wash.
are
20 units
not
Plywood
of three shares
each
to
stockholders, and 16 shares
20
individuals who
to be offered to
on basis of one share for each two
owned.'Price—:Per unit, $12,500; and per
share,
$2,500 to present stockholders. Underwriter—None. Pro¬
ceeds
To acquire timber and a
peeler plant operation.
Office—1500 S. W. Harbor Drive, Portland
are
present stockholders
1, Ore.
* Mutual Telephone Co., Honolulu, Hawaii
July 27 filed 150,000 shares of
common
Proceeds
Co.
&
—
—
Lehman Bro¬
From sale of stock to
stockholders to be used to finance, in part, construction
kilowatt Yale hydro-electric project in South¬
Washington, which, it is estimated, will cost
$26,450,000
of 100,000
west
Western
(letter
23
Inc.
Stores,
notification)
of
convertible
cumulative
(8/13)
15,000 shares
preferred
stock
(par
of
$10)
6%
and
30,000 shares of common stock (par 5 cents) to be sold
in units of one share of preferred and two shares of
common
stock.
White
Co., St. Louis, Mo.,
&
Price—$10.10
unit.
per
Underwriter-
and Gearhart, Kinnard &
Otis, Inc., New York. Proceeds—For acquisition of new
outlets and working capital.
Office—8666 West Pico
Boulevard, Los Angeles, Calif. Offering—Expected week
of Aug. 13.
24 filed 200,000
shares, of common stock. Price—At
($1 per share).
Underwriter—None.
Proceeds—To
purchase machinery and equipment, to construct a mill
in Mexico and for general corporate purposes.
State¬
ment effective June 26 through lapse of time; amend¬
necessary.
Peabody Coal Co.
March
26
filed
160,000 shares of
(par $25).
ceeds—For construction program.
Offering—Indefinitely
postponed.
Philadelphia
Suburban Transportation Co.
notification) $300,000 of 4*/2% con¬
vertible debentures of 1967 (each $100 principal amount
convertible into three shares of common stock).
Price
—At par.
Underwriter—None.
Proceeds—For working
capital.
Office—69th Street Terminal, Upper Darby,
Pennsylvania.
June
11
(letter of
July 5 filed
140,243
shares of
common
(no
stock
par)
being offered for subscription by common stockholders
rate of
None.
one
share for each four
shares held
on
July
stock
(no par)
to be offered for
subscription pro rata by common stock¬
holders. Price—To be supplied
by amendment. Under¬
writer—Kidder, Peabody & Co., N'ew York. Proceeds—
outstanding bills and for construction program.
Offering—Expected late September.
Proceeds
—
From the sale of this stock and the
proceeds from certain borrowings together with company
funds will be applied to construction program.
State¬
ment effective
July 23.
Pittsburgh Plate Glass Co.
June 27 filed 450,000 shares of common stock (par $10)
to be offered to certain employees of the company and
its
subsidiaries
under
stock
option plan.
Price—At
85% of the market price on the New York Stock Ex¬
change at time options are granted. Underwriter—None.
Proceeds—For working capital.
a
Pittsburgh Steel Co.
June 26 filed 12,569 shares of first series 5%% prior pre¬
ferred stock (par $100) and 27,495 shares of common
stock
(no par) to be offered in exchange for Thomas
Steel Co. 4%% cumulative preferred stock (par $100)
at rate of 8/10ths of a share of 5y2% preferred and 13A
shares
of
common
stock
for
each
Thomas
Steel
pre¬
ferred share (unexchanged Thomas preferred stock will
be called for redemption at $105 per share). Underwriter
—None. Statement effective July 16.
Polymer Industries, Inc., Astoria, N. Y.
(letter of notification) 10,000 shares of 6% cu¬
mulative preferred stock (par $5) and 20,000 shares of
July 30
j*'National Distillers Products
July
31
filed
500,000
shares
of
Corp.
(8/21)'
cumulative
preferred
stock, series of 1951 (par $100—convertible
prior to
Sept 1, 1961). Price—To be supplied by amendment.
Underwriters—Glore, Forgan
& Co. and Harriman Rip¬
ley & Co., Inc., both of New York.
Proceeds—To repay
bank loans and for general
corporate purposes. Offering
—Expected week of Aug. 20.
North American Acceptance Corp.
March 20 (letter of
notification) 15,000 shares of 60-cent
cumulative convertible preferred stock
(par $5). Price
--$10 per share. Underwriter—Michael Investment Co.
Xnc.t Providence, R. I.' Proceeds—For
working capital.
Offering—Postponed temporarily.
.*
if Northrop Aircraft, Inc.
June 6 filed 125,000 shares of common
stock (par $1)
Price^-To be supplied by amendment.
Underwriters-^
•William R. Staats Co., Inc., Los
Angeles, Calif. Proceeds
—For working capital.
Offering—Expected today.
-
stock
(par one cent) to be offered in units of
one
share of preferred and two shares of common to
preferred stockholders of record July 27 on the basis
of two units for each five shares held; rights will expire
on Sept.
1.
Price-—$5.02 per unit.
Underwriter—None.
common
Statement
effective June 29.
Realty Co., Denver, Colo.
j
;
June 7 (letter of notification) 2,000 shares of capital
stock (par 25 cents).
Price—$6 per share. Underwriterg
—Ralph S. Young, Colorado Springs, Colo; J. A Hogle
& Co., Salt Lake City, Utah; and Garrett-Bromfield &c
Co
Denver, Colo. Proceeds—For working capital. Office
—937 U. S. National Bank Bldg., Denver, Colo.
Inc., Riverside, Mo.
Stadium,
Riverside
(letter of notification) $250,000 of 15-year 5%
debenture notes and 25,000 shares of common stock
July 12
(par $1) to be offered in units of one $100 note and 10
of stock.
Price—$100 per unit.
Underwriter—
Wahler White & Co., Kansas City, Mo.
Proceeds—To
shares
Offering
obligations.
outstanding
retire
—
Temporarily
postponed.
& Electric Corp.
(amendment) filed 175,000 shares of common
stock (no par), being offered for subscription by com¬
mon
stockholders of record July 31 on basis of one
share for each six shares held; rights to expire Aug. 15.
Price—$31.50 ner share. Underwriter—The First Boston
Corp., New York. Proceeds—For construction program.
ic Rochester Gas
13
July
July 31.
Statement effective
Roebuck & Co., Chicago, III.
July 16 filed 500,000 shares of capital stock (no par) to
be offered to employees under terms of an Employees
Stock Purchase Plan. Price—To be equal to 85% of the
Sears,
price first quoted on the New York Stock Exchange on
the date the contract for the sale is issued. Underwriter
None.
Proceeds—For general corporate purposes.
the Savings and
Roebuck & Co.
Employees and not more than 750,000 shares of capital
stock (no par) to be purchased by the Fund for mem¬
bers during the years. None of these shares will be pur¬
July 16 filed 25,000 new memberships in
Profit Sharing Pension Fund of Sears,
■•'./// ,//:'
chased from the company.
/
Mining Co., Hailey, Idaho
Snoose
(letter of notification) 1,000,000 shares of com¬
Price—At par (25 cents per share). Under¬
writer—E. W. McRoberts & Co., Twin Falls, Ida. Proceeds
—For development of mine.
Proceeds—For
stock.
.
Co., Inc.
filed interests in corporation's employees' sav¬
Oil
Socony-Vacuum
June 28
allot from
contribut¬
additional amount equal to 50% of his allotment;
ings plan which will permit an employee to
1% to 5% of his base pay, with the employer
an
shares of
1,000,000
also
capital stock
(par $15)
expansion program and working capital.
Pratt-Hewitt Oil Corp.,
Corpus Christi, Tex.
July 23 (letter of notification) 13,600 shares of common
stock (par $1).
Price—62 cents per share.
Underwriter
—Merrill
Lynch,
Pierce,
Fenner & Beane, Corpus
Christi, Tex.
Proceeds—To John D. Hawn, a director,
who is the selling stockholder.
Office—520 Lawrence
Street, Corpus Christi, Tex.
if Reading Tube Corp., Long Island City
June 5 filed $1,859,256 of 20-year 6% sinking fund de¬
bentures due July 1, 1971, and 66,402 shares of class B
stock (par 10 cents) being offered in exchange for 265,608
./shares of outstanding class A cumulative and participat¬
which
be purchased in open market or from company at
market; aggregate contributions are not to exceed $35,000,000. Proceeds—Employees may direct that funds in
his account be invested in one or more of the following:
may
(a) Series E U. S. Government bonds; (b) capital stock of
corporation; or (c) common stock of any investment
company
eligible
for
investment.
Statement
effective
July 17.
South State
April
stock.
9
Uranium Mines
(Canada)
Ltd.
filed by amendment 384,000 shares of capital
Price —At par ($1 per share).
Underwriter-
Optionee—Robert Irwin Martin of Toronto.
Pittsburgh Coke & Chemical Co.
at
Dealer-Manager—Aetna Securities Corp., New
Sept. 5.
ing
5V2% prior preferred
Price—To be supplied by amendment.
Underwriter—A. C. Allyn & Co., Inc. Chicago, 111. Pro¬
itock
Thursday, August 9, 195X
share held; offer extended to
for each class A
mon
Par
ment
.
July 19
Milling Co., Las Vegas, Nev.
Jan.
Idaho,
Corp., Portland, Ore.
June 14 (letter of notification) 76 shares of common
stock (par $2,500), of which 60 shares will
be offered
in
shares
certain stockholders.
Underwriters
share.
291,464
remaining
account of
1951, with an oversubscription privilege; rights to
expire Aug. 9. Price—$24.50 per share. Underwriter—
Spokane, Wash.
Proceeds—To meet
property payments, purchase contracts and other mining
and 612 Chronicle
per
the
and
the
23,
common
Payne,
expenses.
Witter
Dean
to
capital stock.
14;
Pan American
Mayfair Markets, Los Angeles, Calif.
May 24 (letter of notification) 5,000 shares of preferred
stock (par $50) and 5,000 shares of common stock
(no
par) to be offered in units of one share of preferred
and one share of common stock.
Price—$60 per unit.
Mt. Rainier, Md.
&
for
sold
Pacific
Lytton's, Henry C. Lytton & Co., Chicago, III.
July 24 (letter of notification) 3,000 shares of common
stock
August
be
to
July
June 15 (letter of notification) 86,250 shares of capital
stock.
Price—At par
($1 per share).
Underwriter—
Floyd A. Allen & Co., Los Angeles, Calif. Proceeds—For
working capital. Office—244 So. Pine St., Newhall, Calif.
Office—3219
thers; Union Securities Corp.; Bear, Stearns & Co.; and
finance expanded merchandise inventory.
Loven Chemical of California
par (in de¬
Underwriter
Light Co.
June 29 filed 541,464 shares of common stock (no par),
of which 250,000 shares are being offered for subscription
by common stockholders of record July 23 at rate of
one new share for each seven shares held, with rights to
sinking fund debenutres dated Oct. 1, 1951 and due Oct. 1, 1966, and 40,-
to
Price—At
.
one-fourth of a share of class B stock
expire on
of debentures and
York.
.
the basis of $7 principal amount
ing stock (par $6.25) on
Edison Co.
Ohio
35
page
Jersey Central Power & Light Co.
Feb. 21 filed 40,000 shares of cumulative preferred stock
to
Chronicle
The Commercial and Financial
(536)
For
Proceeds—
commissions, exploration and development expenses,
working capital.
and
if Southern California Edison Co. (8/28)
July 30 filed $30,000,000 first and refunding mortgage
bonds, series D, due 1976. Underwriters—To be deter¬
mined by competitive bidding. Probable bidders: Halsey,
Stuart & Co. Inc.; Blyth & Co., Inc.; The First Boston
Corp. and Harris, Hall & Co., Inc. (jointly); Kuhn,
Loeb & Co. Proceeds—For construction program. Offer¬
ing—Expected this month.
Southwestern Associated Telephone
Co.
17,500 shares of $5.50 cumulative pre¬
ferred stock (no par). Price—To be supplied by amend¬
ment.
Underwriters—Paine, Webber, Jackson & Curtis
and Stone & Webster Securities Corp., both of New
June
15,
filed
York, and Rauscher, Pierce &
Proceeds—To retire $1,500,000
balance
added
to
Co., Inc., Dallas, Texas.
of
bank
loans
and
the
general corporate funds. Offering
—
Postponed.
if Spiegel, Inc., Chicago, III.
June 21 filed 73,250 shares of common stock (par $2),
to be issuable upon exercise of stock options granted to
officers and key executives of the company under plan
adopted by stockholders on April 18. Price—$11.70 per
share.
Underwriter—None. Proceeds—To reduce bank
borrowings and for working capital. Statement effective
July 23.
'
;
■
Y\>
.
State Loan &
Finance Corp., Washington, D. C.
July 23 filed 160,000 shares of 6% convertible preferred
stock, series A (par $25). Price — To be supplied by
amendment.
Underwriter — Johnston, Lemon & Co.,
Washington, D. C.
poses.
Texas
-
Proceeds—For general corporate pur¬
.
Southeaster^ Gas Co., Bellville, Tex.
May 1(6 (letter of notification) 19,434 shares of common
stock to be offered to common stockholders through
transferable warrants.
Price — At par ($5 per share).
Underwriter—None.
Proceeds—For working capital.
Tiger Tractor Corp., Keyser, W. Va.
July 12 (letter of notification) 200,000 shares of common
stock (par 10 cents).
Price—$1 per share. Underwriter
—M. J. Sabbath Co., Washington, D. C.
Proceeds—For
working capital.
Keyser, W. Va.
Office
—
East and Moselle Streets,
United Canadian Oil Corp.,
Washington, D. C.
July 31 filed 1,000,000 shares of common
stock (petr 10
Volume 174
Number 5036
.
.
The Commercial and Financial Chronicle
.
(537)
cents).
Price—$1
share. Underwriter-—None.
drilling activities.
per
Pro¬
ceeds—For exploration and
4%
or
To -erect
—602
Proceeds—
Underwriter—None.
plants, and purchase equipment.
Street, Camden, N. J.
•
Office
10th
Lake
7
—At
new
North
Van
June
amount.
filed
Uranium
100,000
Mining Co., Van Dyke,
shares
of
common
bonds.
Co.
reduce
To
—
bank
$105.50
shares of $5 cu(no par).: Price—
Underwriter—Allen & Co., New York.
share.
For
—
new
construction.
chased by underwriter for
Westates
Issue
investment.,;;
reported
Canada.
•
Aug.
St., Las Vegas, Nev.
Central
1
obtain
Western Carolina Telephone Co., Franklin, N. C.
July 6 (letter of notification) 2,109 shares of capital
to
stockholders
it
at
•
j,
Bids
ment
Western Reserve Life Insurance Co.
June 12 (letter of notification) 10,000 shares of common
-stock (par $10) to be offered for subscription by present
15
<
Workers Finance Co. of North Bergen, N. J.
;
July 26 (letter of notification) $150,000 of 6% cumula¬
tive preferred debentures due in 5, 10 or 20 years. Price
At par
(in units of $100 each).
Underwriter—None.
Proceeds—To make loans.
Power Co.
and
Salomon
&
Bros.
Hutzler
(jointly);
Drexel & Co.; Union Securities Corp. and Equitable Se¬
Corp. (jointly); Kidder, Peabody & Co.; The
Boston Corp.; Lehman Brothers. Proceeds—For ex¬
pansion program.
Bids—Tentatively expected to
opened on Sept. 11. Registration—About Aug. 10.
Colorado
June 18 it
American President
or
and
sale
was
of
&
of next
this company.
Bids will be
208 So. La Salle
St., Chicago
•
•
•
stocky
ance
for construction program.
ing is contemplated at present.
No
common
•
.
stock financ¬
'
gage bonds due 1967.
mort¬
O.
r
ties
Corp. (jointly); Harriman Ripley &
Co., Inc.
Pro¬
ceeds will be used for additions and
improvements to the
company's properties.
Sept. 1.
Offering—-Expected
and
on
after
Illinois Bell
June 27 W. V.
Telephone Co; :/ *
' *
\
"
Kahler, President, announced that this
company (approximately 99.31%
owned by American
Telephone & Telegraph Co.) plans issuance and
sale,
sometime before the end of the
year, of 682,454 addi¬
tional shares of capital stock to
its stockholders. Under¬
writer—None.
for
new
Proceeds—To repay short-term loans
and
/ V
/';/; >■/
construction.
^
•
.letter & Scheerer
Products, Inc., N. Y.
Bids will be received at
the Office of Alien
(8/291
Property,
Department of Commerce, 120
Broadway, New York 5.
N. Y., up to 11 a.m.
(EDT) on Aug. 29 for the purchase
from The
Attorney General of the United States of 200
shares
of
common
stock (par
$100), which constitutes
100% of the issued and
outstanding capital stock.
Kansas City Power &
Light Co.
Harry B. Munsell, President,
June 12,
pany
hopes to issue
and
announced com¬
sell within the next two
years
$12,000,000 of bonds, $10,000,000 of additional
preferred
stock and $8,000,000 of
additional common stock to fi¬
nance
its
construction
for 1951-1952.
Stockincrease the authorized
preferred stock from 200,000 to 350,000 shares
and the
authorized indebtedness by
$12,000,000. Probable bid¬
ders for preferred stock:
Glore, Forgan & Co. and
was
Lighting Co. 3 %% general
Offering—Postponed. •
;
Cleveland,
probably be placed privately. If
competitive, prob¬
bidders may include
Halsey, Stuart & Co. Inc.;
Blyth & Co., Inc., Lazard Freres and The First
Boston
Corp. (jointly); Equitable Securities
Corp.; Kidder, Pea¬
body & Co.; Salomon Bros. & Hutzler and Union
Securi¬
holders
ward for the
amount of Westchester
Co.,
Will
Cone Mills
Inc.; Morgan Stanley & Co.; The First Boston
Corp.; Merrill Lynch, Pierce, Fenner & Beane and White,
&
Co. (jointly).
Proceeds — To redeem
a
like
&
able
Glore,
art & Co.
Underwriter—McDonald
Idaho Power Co.
Interstate Gas Co.
Weld
(9/20)
July 23 company applied to FPC for
authority to issue
$15,000,000 of additional first mortgage
bonds, due 1981.
voted
July
program
11
to
W.
C.
Langley & Co. (jointly); Smith, Barney &
Co.; The
Corp.; White Weld & Co., Shields & Co.
and Central Republic Co.
(jointly); Harriman Ripley &
Co., Inc.; Salomon Bros. & Hutzler and Merrill
Lynch,.
Pierce, Fenner & 'Beane (jointly); Union Securities
First Boston
■
shares are outstanding).
Bonds will probably be sold
privately, and proceeds used to redeem $420,000 of 33A%
debentures and retire $197,500 bank loans, with the bal¬
Co.
reported that the company plans to issue
$4,000,000 of cumulative convertible preferred
was
Offering—Expected about Sept. 20.
'
:
Karshaw Chemical
and sell
was
Corp., Greensboro, N. C.
reported that preparations are going for¬
marketing of from 400,000 to 500,000 shares
Brothers and Stone & Webster Securities Corp. (jointly);
of outstanding common stock.
Underwriter — May be
Equitable Securities Corp. and Central Republic Co.
Morgan Stanley & Co., New York. Proceeds—To go to
(jointly); Union Securities Corp.; The First Boston Corp.; / selling stockholders.
White, Weld & Co. Proceeds—For construction program,
Consolidated Edison Co. of New York, Inc.
estimated to cost about $20,000,000 in 1951. Bids—Expect¬
March 23 company applied to New York
P. S. Commis¬
ed to be opened about Oct. 9.
sion for authority to issue and sell
$25,000,000 of first
•and
Arkansas Western Gas Co.
refunding
mortgage
\'V
bonds, series H, due May 1,
1981 (in addition to
July 10 stockholders approved issuance of $1,350,000
$40,000,000 series G bonds filed with
first mortgage bonds and increased authorized common
the SEC on March 30). Underwriters—To be determined
stock from 300,000 to 500,000 shares (of which 289,706
by competitive bidding. Probable bidders: Halsey, Stu¬
stock
41/£%.
July 27 it
through 1954. Neither the timing nor
the nature of this new financing have yet been deter¬
mined.
Probable bidders for bonds or debentures: Hal¬
Aug. 7 it
/,/•//•
Proceeds—To finance expansion
program.
This means that additional capital of about
$250,000,000
will be required
$8,000,000 additional first mortgage bonds.
(CDT)
(par $50), with an interest rate J)f
Price—Expected at $52.50 per share.
Underwriter—Probably Glore, Forgan & Co., New York.
around
1951-54 period calls for the
expenditure of about $450,000,000, of which it is estimated that $200,000,000 will
be provided out of cash resources at the
end of 1950.
Underwriters—To be determined by competitive bidding.
Probable bidders: Halsey, Stuart & Co. Inc.; Lehman
RFC at
a.m.
'-V/.-..;
Gould-National
preferred
:
Stuart & Co. Inc.; The First Boston Corp.;
Forgan & Co.; Morgan Stanley & Co.
to 11
Batteries, Inc., St. Paul, Minn./
Aug. 7 Albert H. Daggett, President, reported the com¬
pany is considering sale of 65,000 shares of convertible
$13,747,000
sey,
up
Aug. 22,
on
Commonwealth Edison Co.
May 22 Charles Y. Freeman, Chairman, announced that
the company's scheduled construction
program for the
(10/9)
received by the
4, 111.,
.
announced that company plans issuance
Foote
of
semi-annually over
Halsey, Stuart & Co. Inc.;
.
to the Dollar interests.
an
Bros. Gear & Machine
Corp. (8/22) Aug. 8 the RFC invited bids for the purchase from
it,
as an entirety, of
28,927 shares of common stock (oar $2)
(9/12)
The remainder will go towards
property
" "
.
Gas Co.
estimated cost of approximately
$5,200,by the issuance and sale of first mort¬
pipe line bonds. Latter may be placed privately.
Traditional underwriter:
White, Weld & Co., New York.
mature
Hutzler.
negotiated transaction).
gage
reported that the holdings of the Union
Corp. group of stock of Colorado Interstate
(531,250 shares) will probably be sold
publicly in August
or September.
■
- v r /
•, -
Lines, Ltd.
Arkansas Power & Light Co.
July 16 it
industrise at
Securities
May 27, Charles Sawyer, Secretary of Commerce, proposed the public sale to the highest bidder of the stock
of this company now held by the Department of Com¬
merce. "The proceeds would be placed in escrow until
the Courts decide whether the stock
rightfully belongs
to the Government
to
a
000 to be financed
•
improvements, etc.
Telephone Co.
.April 25 it was announced company may soon file a
letter of notification with the SEC covering $300,000 of
6% convertible bonds. Price—At par (in units of $100
each). Underwriter—Tellier & Co., New York. Proceeds
—-For new equipment and for expansion.
'
to
bonds, series D, due
Sept. 1, 1962.
be
Alaska
.
end
gage bonds du6 July ly 1952^ and to redeem
first and refunding mortgage 4^4%
curities
First
expects
permanent
tially. Price—Not less than par. Underwriter—To be
by competitive bidding.
Probable bidders:
Halsey, Stuart & Co. Inc.; Morgan Stanley & Co.; Lee
Higginson Corp.; Harris, Hall & Co.
(Inc.); Drexel &
Co.; Kuhn, Loeb & Co. and Salomon Bros. & Hutzler
(jointly); Harriman Ripley & Co., Inc.; First Boston
Corp.; Lehman Brothers; Paine, Webber, Jackson &
Curtis; Kidder, Peabody & Co.
Proceeds—To refund
$49,988,000 of 4% non-callable consolidated first mort¬
applied to SEC for authority to sell
$15,000,000 first mortgage
bonds due 1981.
Under¬
writers—To be determined by competitive bidding. Prob¬
able bidders: Halsey, Stuart & Co. Inc.; Morgan Stanley
& Co.; Blyth & Co., Inc.; Harriman Ripley & Co., Inc.;
Co.
additional
determined
(9/11)
company
Shields &
1952
Corp.
company
June
Prospective Offerings
July 31
of
the
Chicago & Western Indiana RR.
2 it was reported
company expects to be in the
market late this year or
early in 1952 with a new issue
of
approximately $70,000,000 of first mortgage bonds,
due 1981, of which about
$65,000,000 will be sold ini¬
Office—770 Bergenline Ave.,
Bergen, N. J.
Alabama
Bros.
RR.
1993.
East Tennessee Natural
/X;///
certificates
Western
company filed an amended application in con¬
nection with a proposal to extend its natural
gas trans¬
mission system to several Tennessee
communities and
Chicago District Pipeline Co.
May 22 it was announced that this
company (a sub¬
sidiary of Peoples Gas Light & Coke Co.) may find it
necessary to construct a 30-inch pipeline from
Volo,
111., to near Mt. Prospect, 111., at a cost estimated at
approximately $1,650,000.
The amount and/ character
of the financing are not now
known.
Bond financing in
March, 1950, was placed privately.
share for each two shares held.
'Price—$20 per share. Underwriter—None.
Proceeds—
For financing expansion program.
Office—1108 Lavaca
(Street, Austin, Tex,
*
North
end
Service
that
Probable bidders:
years.
Salomon
stock.
common
July 17
be received up to noon
(EDT) on Sept. 12
purchase by the company of $6,300,000 of
equip¬
trust
value
& Co., New York.
Pro¬
ceeds—To be applied toward 1951 construction
program.
will
v
one
Public
announced
the
Grande
offered to public pursuant to
Probable Underwriter—Allen
Co., Charlotte, N. C.
Chesapeake & Ohio Ry.
for the
Proceeds—For working capital.
par
July 16 corporation received SEC authority to issue and
sell $900,000 of debentures to mature
July 1, 1957 (to
be placed privately with an
institution) but reserved
jurisdiction over the proposed issuance of
approximate¬
ly 12,500 additional shares of common stock (latter to be
financing is necessary, under¬
Morgan Stanley & Co., New York.
additional construction expenditures to the
year.
no
Derby Gas & Electric Corp.
dollars
including equity financing. It is estimated
that about $3,400,000 will be
required to take oare of
one new share for each two shares held on
July
16, with rights expiring on Aug. 16; unsubscribed shares
may be publicly offered. Price—$50 per share to stock¬
holders and $60 per share to public. Underwriter—None.
stockholders at rate of
both due Jan. 1,
public
Vermont
was
before
preliminary
—
financing,
rate of
:
If
R. S. Dickson &
Proceeds—For development of tungsten mineral property
being first offered
a
$3,595,295, to be
financed by the sale of first
mortgage bonds and the
issuance of junior securities. Underwriters
may include
,,
in Arizona.
(par $50)
of
:to serve certain areas in North and
South Carolina. Estixmated cost of the proposed facilities
is
pur-
July 24 (letter of notification) 300,000 shares of common
stock. Price—At par ($1 per share). Underwriter—None.
stock
construction
Feb. 20
Explorations, Inc., Las Vegas, Nev.
Office—504 So. 3rd
finance
Carolina Natural Gas
Corp., Charlotte, N. C.
a fourth amended
application was filed with the
fSEC for
authority to build a natural gas pipeline system
(letter of notificationp.l,000
per
to
because of the influx of American
writers may include
-mulative convertible preferred stock
-Proceeds
be used
• Canadian National Ry.
Aug. 6 it was reported that it may become
unnecessary
to refund
the 4y2% guaranteed
mortgage gold bonds
which mature on
Sept. 1, 1951 (approximately $48,000,000
into
(N. J.)
one-year
to
plant at Coosa Pines, Ala., and for work¬
Offering—May be made privately.
outstanding)
a
12, Wilson McCarthy, President, stated that due
prevailing market conditions, the company has
post¬
poned to an undetermined date the
taking of bids for
the purchase of
$40,000,000 first mortgage bonds to be
dated May 1, 1951, and to
mature on May
1, 1981. Un¬
derwriters—To be determined
by competitive bidding.
Probable bidders: Halsey, Stuart & Co.
Inc.; Morgan
Stanley & Co.; Kuhn, Loeb & Co. and Bear, Stearns
& Co.
(jointly).
Proceeds
Together with treasury
funds, to redeem on June 1, 1951, $35,062,200
oustanding
first mortgage 3%-4%
bonds, series A, and $8,666,900 of
Denver & Salt Lake income
mortgage 3% -4% bonds,
r
rayon tire yarn
^ West Virginia Water Service Co.
27
to
sources,
issue
April
Mills, Inc.
ing capital.
to
shares of
Denver & Rio
Beaunit
•Office—3909 Hemphill St., Fort Worth, Tex.
June
stock and 100,000
June 26 stockholders
approved issuance and sale of 100,000 shares of
$5 cumulative preferred stock (no par).
loan.
decided
—
Underwriters—Probably White, Weld & Co. and Kidder,
Peabody & Co. Proceeds—From sale of stock,
together
with $15,000,000 from bank
loans and $3,000,000 from
Proceeds
FPC
common
(jointly); Harris, Hall & Co., Inc. and Equitable
(jointly). Proceeds
For construction
other
20
permit to the corporation for
investigation of the pro¬
posed development of a hydroelectric
project on the
Delaware River in New
Jersey, Pennsylvania and New
York, estimated to cost $47,000,000.
Early last year, it was
announced that the
proposed project would be financed
through the issuance of $28,200,000 of
bonds, $14,100,000
of
preferred stock, $4,700,000 of convertible
petitive bidding. Probable bidders for bonds:
Halsey,
Stuart & Co. Inc.;
Paine, Webber, Jackson & Curtis and
Stone & Webster Securities
Corp. (jointly); Kuhn, Loeb
& Co, and Salomon Bros. &
Hutzler (jointly); White,
Weld & Co., Kidder,
Peabody & Co. and Shuman, Agnew
Weisfield's, Inc., Seattle, Wash.
May 21 (letter of notification) 5,244 shares of capital
stock.
Price—$53 per share. Underwriter—None. Pro¬
ceeds—For working capital.
Office—Ranke Bldg., 1511
Fifth Avenue, Seattle 1, Wash.
share).
June
—
program.
per
Delaware River Development
Corp.
.
year
Underwriter—Titus Miller &
Co., Detroit, Mich.
Proceeds —For exploration and
drilling of mining claims.
Office—23660 Van Dyke
Avenue, Van Dyke, Mich. Offering—Expected soon.
($1
par
"Underwriter—None.
.
.
plans call for the
of $8,000,000 additional first mort¬
Underwriter
To be determined by com¬
this
Securities Corp.
Price
(Calif.)
was announced that tentative
later
gage
&
Mich.
stock.
^ Welex Jet Services, Inc., Fort Worth, Texas
July 16 (letter of notification) 9,573 shares of common
stock (no par) being offered to stockholders of record
July 10 at rate of 6V2 shares for each 100 shares held,
with an oversubscription privilege. Price—$16 per share.
I
July 3 it
'
(letter of notification) $100,000 to $200,000 of
6% convertible preferred stock, or a mortgage
loan of that
.
sale
United States Gasket Co.
July 25
Associated Telephone Co., Ltd.
'
37
,
,
Corp. and Stern Bros. & Co. (jointly). Probable bidders
for common stock; Lehman
Brothers; Glore, Forgan &
Co.; Harriman Ripley
Co., Inc.
Probable bidders for
bonds:
Halsey, Stuart & Co. Inc.; JSIyth & Co., Inc.;
White, Weld & Co.; Shields•& Co. and Central Republic
Co.
(jointly); Glore, Forgan & Co.; Smith, Barney & Co.;
Continued
on
page 33
38
i
The Commercial and Financial Chronicle
(538)
Continued from page
(jointly); Lehman Brothers and Bear,
(jointly); The First Boston Corp.; Equit¬
able Securities Corp.; Harriman Ripley & Co., Inc.
& Hutzler
Bros.
Stearns & Co.
'
Kansas Gas & Electric Co.
Murray F. Gill, Chairman of the board, an¬
that the company's present construction pro¬
24
May
nounced
calls for expenditures of more than $8,000,000 in
To finance part of the expansion program, com¬
gram
1951.
sell $5,000,000 of first mortgage bonds. Under¬
writers—To
be
determined by competitive bidding.
Probable bidders:
Halsey, Stuart & Co. Inc.; Union
Securities Corp.; Merrill Lynch, Pierce, Fenner & Beane
and Kidder, Peabody & Co. (jointly).
There is a pos¬
pany may
refund its
bonds due
1970
(held by a group of insurance companies) and
$5,000,000 first mortgage 3y8% bonds due 1978.
sibility that company may also decide to
outstanding $16,000,000 first mortgage 3%%
18,
company
Dallas, Texas
Broadcasting System,
Liberty
July
Barton R. McClendon, Chairman, announced
expects in a few weeks to raise about $3,000,000,
probably through the sale of additional common stock.
It has not been decided whether the financing will be
privately
done
publicly.
or
include Blyth & Co., Inc.
Inc.
Merck, Chairman, announced
stock¬
10 will vote on approving issuance and
sale through rights to common stockholders of an issue
of approximately $25,000,000 of new convertible second
preferred stock. Price—To be supplied later. Under¬
writers
Goldman, Sachs & Co. and Lehman Brothers,
both of New York. Proceeds — For capital investments
and working capital.
holders on Sept.
—
Corp.
applied to FPC for a license for a pro¬
posed new project estimated to cost $22,611,000. On Jan.
26, company had announced that rt probably would sell
late this year or early 1952 about $15,000,000 of addi¬
tional common stock to finance part of its $150,000,000
construction program scheduled for 1951, 1952 and 1953.
Probable bidders: Merrill Lynch, Pierce,
Fenner &
Beane; Kidder, Peabody & Co. and White, Weld & Co.
(jointly); Morgan Stanley & Co.
'
Niagara Mohawk Power
June 8, company
Ohio Power Co.
May 15 it was stated that this company, a subsidiary of
American Gas & Electric Co., will need $36,000,000, per¬
haps more, which it expects to raise some months hence
through the sale of new securities. Probable bidders for
bonds: Halsey, Stuart & Co. Inc.; Morgan Stanley & Co.;
The First Boston Corp.; Glore, Forgan & Co., White,
Weld & Co. and Union Securities Corp. (jointly). Pro¬
ceeds will be used for construction program.
Previous bond financing was done
Pacific Power & Light Co.
29 it
sale of
of 1952.
was
Telephone
Corp.
later this year.
Underwriter—Probably The First Boston
for the next two years.
Rockland Light & Power Co.
July 19, Rockwell C. Tenney, President, announced that
the company is planning the issue and sale this Fall of
approximately $6,000,000 of first mortgage bonds, series
D. Underwriters—To be determined by competitive bid¬
Probable bidders: Halsey, Stuart & Ckx Inc.; The
First Boston Corp.; Merrill Lynch, Pierce, Fenner &
Beane; Blyth & Co., Inc.; Kidder, Peabody & Co.; Union
Securities Corp. and White, Weld & Co. (jointly); Leh¬
man Brothers and A. C. Allyn & Co.
(jointly); Stone &
Webster Securities Corp.; Carl M. Loeb, Rhoades & Co.
and Equitable Securities Corp. (jointly). Proceeds—For
expansion program.
#
/
,
......
Calif.
plans to increase
Ryan Aeronautical Co., San Diego,
Aug. 4 it
was
announced company
plans issuance and
Reauthorized capital stock (par $1) from 500,000 to
1,000,000 shares in order to place it in a position to
do appropriate financing of some form of its own securi¬
ties if and when advantageous to the company. The new
financing may take the form of a general offering for
sale to the public or granting of rights to stockholders;
or the reservation for conversion of long-term indebt¬
edness which could be issued with provision for con¬
The company presently
capital stock, of which
45,350 shares are held by the wholly owned subsidiary,
Ryan School of Aeronautics.
■ '
#
vertibility into common stock.
has outstanding 439,193 shares of
San Diego Gas & Electric Co.
July 19, L. M. Klauber, Chairman, announced that the
company plans to sell $10,000,000 of bonds early in 1952.
Underwriters—To be determined by competitive bid¬
ding. Probable bidders: Halsey, Stuart & Co. Inc.; Blyth
& Co., Inc.; Merrill Lynch, Pierce, Fenner & Beane; The
White, Weld & Co. and Shields &
(jointly); Lehman Brothers.
Proceeds—For expan¬
sion program.
$15,000,000 of mortgage bonds in the early part
Underwriters — To be determined by competi¬
bidding.
Probable
bidders:
Co.
stock, see a preceding column).
Parkersburg
(W. Va.)
Rig & Reel Co.
Schering Corp.
July 26 it was reported that the company's entire com¬
stock issue (440,000 shares) was expected to be
registered with the SEC this month and offered for sale
probably late in September or early in October to the
highest bidder by the Office of Alien Property. Prob¬
able bidders: A. G. Becker & Co. (Inc.), Union Secur¬
Corp. and Ladenburg, Thalmann & Co. (jointly);
Merrill Lynch, Pierce, Fenner & Beane; Kidder, Peabody
ities
Pennsylvania Electric Co.
Aug. 3 filed with Pennsylvania P. S. Commission a pro¬
posal to issue and sell $5,000,000 of first mortgage bonds,
30,000 shares of $100 par preferred stock and about
$3,000,000 of common stock (latter to General Public
Utilities Corp., parent).
Underwriters—To be deter¬
mined by competitive bidding.
Probable bidders for
bonds:
Halsey, Stuart & Co. Inc.; Kidder, Peabody &
Co.; Merrill Lynch, Pierce, Fenner & Beane; Union
Securities Corp.
and White, Weld & Co.
(jointly);
Equitable Securities Corp.; The First Boston Corp.;
Kuhn, Loeb & Co.; Lehman Brothers and Drexel & Co.
(jointly); Harriman Ripley & Co., Inc. Probable bidders
for
preferred stock: W. C. Langley & Co. and Glore,
Forgan & Co. (jointly); Kuhn, Loeb & Co.; Smith,
Barney & Co.; Kidder, Peabody & Co.; Harriman, Rip¬
ley & Co., Inc. Proceeds—For 1951 construction pro¬
gram.
»
Expected late
summer
Public Service Co. of
June 25 it
manent
or
early fall.
Indiana, Inc.
reported that company may do some per¬
financing "when market conditions permit."
was
Earlier this year
arrangements
were
made
Co.; F. Eberstadt & Co.; Allen & Co.; new company
by United States & International Securities
Corp., Dillon, Read & Co.; F. S. Moseley & Co.; Riter
formed
Aug. 1 it was announced directors have approved in
principle a plan to offer not exceeding $300,000 of com¬
mon
stock for subscription by common stockholders.
Formal announcement is expected shortly.
with
eight
& Co.
,
^Seaboard Air Line RR.
expects
company
(8/21)
Aug. 7 the RFC invited bids for the purchase from it of
the following securities of this railroad company: $5,-
to
soon
cover¬
1981
bond
Proceeds—To be used for
and distribution system.
tion
Natural
Gas
Co.
announced company has filed
was
with
expansion of gas transmission
Bids—Expected Aug. 28.
FPC
an
applica¬
for
permission to construct additional
.-facilities to cost an estimated $13,641,000, of which ap¬
proximately $9,187,000 is expected to be spent in 1951.
Southern
•
Union Gas Co.
w
May 23 C. H. Zachry, President, announced that com¬
pany plans the issuance of $5,000,000 new first mortgage
bonds within the next 60 to 90 days. Traditional Under¬
writer—Blair, Rollins & Co., Inc. Proceeds—For new
.construction.
.
%
i
•
-
Superior Water, Light & Power Co.
July 7 it was reported that company expects to sell $1,000,000 additional bonds this month or next and another
^bond issue for a like amount in January. May be placed
privately.
*
[
Tennessee Gas Transmission Co.
July 27, it was announced company soon expects to file
a registration
statement with the SEC covering a new
lissue of $45,000,000 first mortgage bonds. Underwriters
—To be determined by competitive bidding.
Probable
bidders: Halsey, Stuart & Co. Inc.; Stone & Webster
Securities Corp. and White, Weld & Co. (jointly).* Pro¬
ceeds—For expansion program.
Offering—Expected in
September.
' - t
•
..
-
,
.
,
"
United
Gas
Improvement Co.
'June 18, the SEC directed the company to dispose of its
interest in six non-subsidiary companies, viz: 'Central
Illinois Light Co., 35,340 shares; Consumers Power Co.,
52,586 shares; Delaware Power & Light Co., 37,355
shares; Niagara Mohawk Power Corp., 145,000 shares;
Public
Service
common
Coach
Electric
&
Gas
Co.,
preference
36,801
shares and 4,861 common shares; and Delaware
Co.,
a
$1,000,000 note.
;
Utah Power & Light Co. (10/29)
July 25 it was announced company plans to register
.with SEC on Aug. 6 an issue of $9,000,000 30-year first
mortgage bonds. Underwriters—To be
competitive bidding. Probable bidders:
&
determined
Halsey,
by
Stuart
Co.
and
Inc.; Kidder, Peabody & Co.; Lehman Brothers,
Bear, Stearns & Co. (jointly); White, Weld & Co.;
Salomon Bros. &
Hutzler; First Boston Corp., and Blyth
Co., Inc. (jointly); Union Securities Corp., and Smith,
Barney & Co. (jointly). Proceeds—To repay bank loans
and for construction program. Bids—To be received up
to noon (EST) on Oct. 29.
&
mon
&
•
announced
was
bonds,
(probably as 3Y4S). Underwriters — The last
financing was handled by Blyth & Co., Harriman
Ripley & Co. Inc. and Dean Witter & Co. in April, 1948.
due
July 31 it
July 18, it was reported that the company expects to
raise money through the sale of some preferred stock
Co.
announced company
Halsey,
Stuart &
Inc.; Blair, Rollins & Co. Inc. and Carl M. Loeb,
Rhoades & Co. (jointly); Lehman Brothers; W. C. Langley & Co. and The First Boston Corp. (jointly); Union
Securities Corp.; Kidder, Peabody & Co.; Blyth and Co.,
Inc., White, Weld & Co. and Harris, Hall & Co., Inc.
(jointly). (For registration of 541,464 shares of common
tive
it
a
registration statement with
the
SEC
ing approximately $12,000,000 of first mortgage
privately.
First Boston Corp.;
June
2
file
ding.
Inc.
July 26, George W.
July
Electric Corp.
expects to issue
$5,000,000 additional first mortgage bonds and additional
debt securities or preferred or common stocks, bank
borrowings, or some combination thereof, in connection
with its construction program. The method of obtaining
such additional cash requirement has not been deter¬
proposal to increase
Merck & Co.,
&
Corp., New York. Proceeds—To finance, in part, a $10,000,000 construction program the company has budgeted
announced stockholders will vote Oct. 23
authorized common stock by
500,000 shares to 2,500,000 shares in order to provide for
a probable offering of additional stock to common stock¬
holders. Probable underwriter: Goldman, Sachs & Co.,
New York. Proceeds will be added to working capital.
a
Rochester Gas
Southern
May 24 it was
on
•
Aug. 1 it was announced that company
Rochester
that the company's
McKesson & Bobbins,
t
up
.
mined.
next step
in its financing program may include the sale of ap¬
proximately $15,000,000 of preferred stock. Probable
bidders may
borrowing
.
Co.
Long Island Lighting
June 25 it was reported
Thursday, August 9, 1951
.
notes bearing interest at
Securities Corp. and Salomon
Kuhn, Loeb & Co.; Union
.
To refund the presently outstanding $4,000,000 of 4%%
to $40,000,000 on promissory
first mortgage bonds and repay outstanding short-term
21/2%. Of this total, it is planned
bank notes which are due before the end of the year.
to use $13,000,000 in 1951, $14,000,000 in 1952 and $13,000,000 in 1953. Underwriters—May be determined by
::
South Jersey Gas Co.
competitive bidding. Probable bidders for bonds: Hal¬
June 15, SEC announced approval of a plan filed by The
sey, Stuart & Co. Inc.; Kuhn, Loeb & Co.; Union Securi¬
United Corp., which, in part, provides for the sale by
ties Corp. and Salomon Bros. & Hutzler (jointly); Blyth
the latter of its entire interest, amounting to
28.3%,
& Co., Inc.; The First Boston Corp.; Glore, Forgan &
or 154,231.8 shares of South Jersey common stock
(par
Co.; Merrill Lynch, Pierce, Fenner & Beane; Kidder,
$5). These holdings will probably be disposed of to a
Peabody & Co. and White, Weld & Co. (jointly); Harri¬
small group of investors.
•
;
•
: *.
man Ripley & Co. Inc.
Probable Bidders for preferred
stock: Blyth & Co., Inc.; Glore, Forgan & Co.; Harriman
Southern California Gas Co.
>
>
Ripley & Co. Inc. Proceeds—To retire bank loans in¬
April 4, the company indicated it would this year be in
curred in connection with construction program.
the market with $18,000,000 of senior securities.
Prob¬
able bidders:
Halsey, Stuart & Co. Inc.; Blyth & Co.,
Public Service Co. of North Carolina, Inc.
Inc.; White, Weld & Co.; Lehman Brothers; Merrill
July 12 it was announced company plans to issue and
Lynch, Pierce, Fenner & Beane and Harris, Hall & Co.
sell several million dollars of first mortgage bonds in
(Inc.) (jointly).
Offering—Expected in the Fall.
;
the Fall.
In July last year, $1,200,000 of bonds were
placed privately with two institutional investors.
Southern Counties Gas Co. of California (8/28)
for
banks
37
.
Utah Power & Light Co.
(9/19)
i{
..
,/
reported company plans to register with
Aug. 6 an issue of 175,000 shares of common
July 25 it
SEC
on
,
..
was
Underwriters—To be determined by competitive
stock.
bidding. Probable bidders: Blyth & Co., Inc.; W. C.
Langley & Co., and Glore, Forgan & Co. (jointly); Union
Securities
Barney & Co. (jointly);
(jointly); Kidder,
Peabody & Co., and Merrill Lynch, Pierce Fenner &
Beane (jointly). However, common stock offering may
be made directly by company, without underwriting.
Offering—Of stock expected about Sept. 18 and bonds
late in October. Proceeds—To repay bank loans and to
Corp., and Smith,
Lehman Bros, and Bear, Stearns & Co.
provide
additional
construction
Bids—To K be
funds.
785,872 general mortgage 4^2% income bonds, series A,
due Jan. 1, 2016; 9,543 shares of 5% preferred stock, se¬
ries A (par $100); and 102,273 shares of common stock
(no par). Bids will be received by the RFC on Aug. 21
at 143 Liberty St., New York 6, N. Y., or 811 Vermont
opened at 11
Ave., N. W., Washington, D. C. Probable bidders
proximating $20,00*0,000, incident to the 1951 construction
program, and that further financing will be required in
1952.
Probable bidders for bonds: Halsey, Stuart & Co.
.
may
in¬
clude: Hornblower &
Weeks; White, Weld & Co.; Merrill
Fenner & Beane, Stein Bros. & Boyce
Lynch, Pierce,
(jointly); Bear, Stearns & Co.
Georgia Natural Gas Co.f Atlanta, Ga.
'
May 24 the FPC dismissed the application of company
to construct 527 miles of natural gas pipe line to supply
which
in
was
Georgia and Florida, the estimated cost of
between $10,500,000 and
(EDT)
on
Sept. 19.
^
.
Virginia Electric & Power Co.
May 1 the company announced that it is contemplated
that there will be additional financing to an amount ap¬
Inc.; Salomon Bros. & Hutzler; Stone & Webster Securi¬
ties Corp.; Union Securities Corp.; White, Weld & Co.
•;
South
markets
a.m.
$12,080,000.'
«t
\
^
v
'
j
West Texas Utilities Co.,
July 27 it
was
•
*
'
.y
"'■■■
-
■
*
^
.
reported company plans to sell $7,000,000
bonds late this Fall. Underwriters—To
competitive bidding. Probable bidders;
of first mortgage
be determined by
Hemphill, Noyes, Graham,
Co. (jointly)," The First
Boston Corp.; Kidder, Peabody & Co.; W. C. Langley &
Co.; Union Securities Corp.; Equitable Securities Corp.;
Harriman Ripley & Co.; Lehman Brothers; Glore, Forgan
& On; Merrill Lynch, Pierce, Fenner & Beane. Proceeds
Halsey,
South Jersey
Gas Co.
April 24 Earl Smith, President, announced company
plans a bond issue of more than $8,000,000 by fall of
this year.
Underwriters—May be determined by com¬
petitive bidding. Probable bidders: Halsey, Stuart &
Parsons
Co.
Inc.; Lehman Brothers; Blyth & Co., Inc. Proceeds—
—For
Stuart &
&
new
Co.
Co.
and
Inc.;
Drexel
construction.
'
&
~
~
~
-
-•"*
Number 5036
Volume 174.
.
.The Commercial and Financial Chronicle
.
through
sale
the
of
first
new
latter
Stock
Option Advisory Panel of tion holder is not compensation subsequent to the enactment of
Salary Stabilization Board, taxable as ordinary income but is the Defense Production Act.
which opened hearings on Aug. 6 rather a
capital gain resulting Should the use of such options be
be
also
issue
will
the
at
Association of the Bar of
through competitive
the City of New York, 42 West
bidding and will provide funds for
44th
Street.
The memorandum
expansion of gas transmission and
was presented by Brig. General C.
distribution facilities.
O. Bickelhaupt, President of the
Society. The memorandum stated:
marketed
Holds Restricted
"Two
weeks
after
Congress
the Defense Production
Act, it enacted, as part of the
Revenue Act of 1950, Section 130A
passed
Stock
The
.
securities
new
grip of
customary August lull. But
underwriting industry, long
caught
definitely
the
'1 the
accustomed
letdown,
'
the
in
this
to
does
not
midsummer
be
to
appear
perturbed.
Quite to the contrary investment
while
naturally
and eager to do business,
banking
,
ready
will
firms,
the weeks ahead
use
their
affairs
in
shape
vival of activity after
.
This week
,
'
producing
by
put
a
re-
for
of
offerings, largely
of secondary operations in
way
■-.equities
offering of $15,000,000 of new 25-
,
first mortgage bonds brought
year
out four bids, the winning tender
-
fixing
f
[.
♦
price
a
3^4%
the
Stock Options of
on
Society of Corporate Secre¬
taries
contends, under Sec. 130A
of Internal Revenue
conditions
tain
Code, if
cer¬
met,
gain
are
101.11, for,
of
taxable
as
as
ployees.
s'tock
to
options'
Under
certain
Code,
corporations
specific
to
em¬
conditions
BEAUNIT
DIVIDEND NOTICES
l3otde4t6
personnel are outside of the
jurisdiction of the Salary Stabili¬
the
Defense
American
Society
of
Corporate
Secretaries, Inc.
Committee's
The
set forth in
a
opinion
A
per
the
on
interest
same
lowest of the four
.
with
the
offering to
pay
rate
pon.
•
The first three
bidders
ap¬
The
bonds
investors at
of
3.80%.
offering
•
As
Early
less than enthusiastic.
was
matter of fact some "drop¬
a
outs"
-
price of 102, a yield
reaction to the
a
reported
were
winning
the
the bid and
payable September 1,
1951, to stockholders of record at
the close of business August 10, 1951.
Company,
In
r
keeping
the
with
the
of Eaton Manufacturing
21st Consecutive
Checks will be mailed.
lows
of the year has
been
.
share
on
Quarterly Dividend
ord
the
at
stockholders of
of
close
business
(DIVIDEND No.
The Board of Directors
on
of Eaton Manufacturing Company
of
Directors
1951
,
of
At any rate observers report
in
turned
bit
a
securities
these
"sticky"
the
prospective buyers showing
:
share on its capital stock of
per share,
payable September 20, 1951, to
ten-
a
stockholders
re¬
a
New
continue
;
weeks
<
in
Issues
Current
dullness
through
the
unless
record
close of business
which has pared potential
yields some 10 to 15 basis points,
bringing yields to a level that
makes the buyer a trifle wary.
>
covery
c
of
on
at
The
the
B.
August 21,
EARLE
MORAN
close
to
it
when
August
way
securities
which
for
it
of
4V£% series
holds
of
A general
A
preferred
102,273 shares of
1951
to
stock
3,
bids
iv
.
at the
RAIBOURN,
and
open
a
DIVIDEND
,
x
ACY
regular quarterly dividend on
the Common Stock of 40
per
cents
following week will bring
_
is
slated
open
to
PREFERRED
II
lion-wide subsidiaries
—
I
principally.
r/M
on..
on
$30,000,000
new
Gas
day the Southern
Co.
of
California
will be in the market for
$12,000,of
new
money
Public Loan Corporation
m-'
m
August 28.
And the same
Counties
of,
to
be
raised
I
:
wA.
Loan Service
I
Corporation
Ohio Finance Company
General Public Loan
6y/s,
11
11
11
DIVIDEND
MO.
20
dividend of eighty-one
and one-quarter cents (81%#) per share
on the S%% Cumulative Convertible Pre¬
ferred Stock, $100 par value, of this Company has been declared, payable Septem¬
ber 5,1951, to stockholders of record at the
close of business August 17. 19oL
A regular quarterly
Transfer books will
not
be closed.
W. E. HAWKINSON,
wA.
Corporation
books
will
Auguat 3, 1951
Treasurer
August 15, 1951. The
close.
HARTS, JR.
Common and Preferred
DIVIDEND NOTICE
Company has declared regular
Limited
quarterly dividends of 25 cents
Dividend No.
per share on
10
divi¬
the Ordinary
The Board of Directors today declared a
dend of ten shillings i>er share on
Shares of The Company payable August 31,
Ordinary Shares of rec¬
August 24, 1951.
The Directors authorized the distribution of
the said dividend on September 11, 1951 to
the holders of record at the close of business
1951 to the holders of
ord at the close of business
on
September
4,
1951
of American
shares
$1.39 per
4.5%
share
convertible
on
to
on
the
preferred
stock of the company ,
payable
both
September 1,1951,
stockholders of record at the
close
1951.
of
business
y,
share, subject, however,
change which may occur in the official
exchange for South Africa funds prior
August 31, 1951. Union of South Africa
the common stock
and $1,125 per
issued under the terms of the Deposit Agree¬
ment dated June 24, 1946. The dividend will
amount to
,
August 3,
^
Secretary
to any
rate of
to
tax
at
the
rate
of
7V>% will be deducted.
By Order of the Board of Directors,
H. E. DODGE, Secretary.
New York,
N. Y., August 8, 1951.
*
Robert Fisher
payable Sep¬
not
re¬
V
The Board of Directors of the
Secretary and Treattw,
August S, I85L
the
1951 to stockholders
non-resident shareholders
Checks will be mailed.
at
O'okiep Copper Company
109
quarterly dividend of one dollar ($1.06)
share on the issued and outstanding
stock, without par value, of this
Company has been declared, payable Sep¬
tember 29, 1951, to stockholders of record
Ht the close of business September 7, 1951.
Treasurer
_
Financing the Conannier through nai>
tenders
000
NO.
per
August 15, 1951.
July 30, 1951
out new issues of two West Coast
bonds
DIVIDEND
record
August 10,1951.
stock transfer
the
MFG. CO.
D. L. BARNES, JR.
Edison
on
of
on
Shreveport, La.
August 3,1951
A
share, payable September
record
fornia
stock,
of record
share
per
A1IIS<CHALMERS
COMMON
1, 1951, to stockholders of
Cali¬
($.25)
August 2,1951
common
Southern
main open.
dividend of 25
a
W. W.
West Coast Issues
bids.
The
day declared
tember 1,
ON COMMON STOCK
Machine Corp. common.'
for
The Board of Directors has this
cents
phases of television
stockholders
close of business
CONSECUTIVE
QORD
00
for 28,927 shares of common
utilities
to
common
stock.
following day it will
The
COMPANY, NEW YORK, N. Y.
OF ILLINOIS
stock of Foote Brothers Gear and
-
the
1951
in all
sixty-five cents (65f0
share on the Capital Stock of
Company has been declared this
day, payable on September 10,1951,
per
Pre¬
The Board of Directors declared
The
A dividend of
Stock
Treasurer
as
mort¬
common
Cumu¬
INVESTMENT COMPANY
bonds, due 2016; 9,543 shares
series
Consecutive Dividend
transfer books will
three
collateral. These include $5,785,872
gage
196th
quar¬
share on
Preferred
1,
THE TEXAS COMPANY
business September 15,1951.
(mhicwv
Aug. 21
on
per
July 27, 1951
this
Treasurer
Finance
bids
Inc.
regular
a
PAUL
blocks of Seaboard Air Line Rail5
of
is broken
hand
a
opens
on
DIVIDEND NOTICE
at the moment.
Corp. will lend
t
Declared
few
next
Reconstruction
The
.
Allen
ferred Stockholders of record
promises
spell
of
shares of 5%
October
payable
by the emission of something in
the way of negotiated business not
in evidence
declared
Convertible
lative
Broadway, New York 4, N. Y.
Directors
dividend of $.25
its outstanding
Secretary and Treasurer
Hopper
the
of
Laboratories,
Mont
has
terly
5
Board
Du
day
1951.
C.
Secretary
the
the par value of $50
dency to shy away.
Tax-exempts have scored
Allen B. Du Mont Laboratories, Inc.
per
'
August
August 10, 1951.
H. C. STUESSY, Secretary
dend of
with
again
Mining Com¬
has today declared a divi¬
Seventy-five Cents ($.75)
pany
has
on
B. C. REYNOLDS
August 25, 1951, to shareholders
of record at the close of business
.
Anaconda Copper
market
Board of Directors
1,1961.
dividend
extra
an
Fifty Cents (5(K) per share
1,792,520 $2.00 par value
common
shares of the Company
issued and outstanding, payable
on
August 3, 1951
Board
declared
the
on
of
Secretary
DIVIDEND NO. 173
June 28,
114)
rec¬
has
GEORGE SELLERS,
share
per
stock ($10 par value)
payable September 1, 1951 to
stockholders of record August
16, 1951 was declared by' the
common
EXTRA DIVIDEND
August 15, 1951.
AnacondA
A regular quarterly dividend
of 45 cents
Cleveland 10, Ohio
the
on
MANUFACTURING COMPANY
ELTON
the Common Stock of
payable on Septem¬
to
of California
DIVIDEND NOTICE
regular quarterly dividend of 50c
ber 1, 1951
The
robust side.
H. C. STUESSY, Secretary
Declared on'Jiily 27,1951
The Board of Directors has declared
per
PACIFIC
FINANCE CORPORATION
OHIO
the Company,
and
other tax-exempt issues from the
-
DAYTON,
shareholders
the close of business
at
August 10, 1951.
LIGHT COMPANY I
^
municipal
in
recovery
Secretary
Mass.
The Board of Directors
POWER AND
THE DAYTON
STOCK
a
general
r
Paul E. Crocker,
160 State Street, Boston,
j\ DIVIDEND NO. 113
August 25, 195lx to
VEDMUND HOFFMAN, Secretary.
scheme of things, it appears that
Colony
Trust Company of Boston, Dividend Disburs¬
ing Agents.
Cleveland 10, Ohio
—_
of record
Municipals Turn Sticky
♦
quarterly dividend of Seventy-five
Company has declared a dividend
of Fifty Cents (50<) per share on
the 1,792,520 $2.00 par value
common shares of the Company
issued and outstanding, payable
31,
1951 a quarterly dividend of
three-quarters per cent was declared on
of this Company, payable
open.
A regular
MANUFACTURING COMPANY
EATON
Treasurer
August 2. 1951
Preferred Stock
books will remain
Boston, August 2, 1951
POLONSKY, Secretary
the close of business August 8,1951.
Checks will be mailed by the Old
L. NOETZEL
E.
October 1, 1951 to Stockholders of record at the
close of business September 13, 1951. Transfer
managers
reoffering basis.
July
and
the
sat
down in the final meeting to fix
-
syndicate
when
On
one
H.
(50^) per share have been declared payable
August 15, 1951, to stockholders of record at
CAN COMPANY
PREFERRED
COMPANY
1951.
capital stock of The Borden
AMERICAN
being offered to
are
MANUFACTURING
of sixty cents
dividend
DIVIDEND NOTICES
peared to be thinking pretty much
along the same price lines.
per
nas
share has been declared
<100.499 and naming the same cou*
PEPPERELL
50c
Stock
Cents (75$ and an extra dividend of Fifty Cents
interim
(60#)
of
Common
payable September 1,
stockholders of record
to
1951,
August 15,
N.
An
dividend
the
on
been declared
£
The runners-up bid 101.0199 for
the
quarterly
share
No. 166
DIVIDEND
was
memorandum to the
Mills, inc.
>:
>;
utive
under
$
are
ordinary income but
Act, as amended, it
was declared Aug. 6 by the Com¬
mittee on Stock Options of the
DIVIDEND NOTICES
if
capital gain.
Board
frustrated by the action of an
of the administrative board created un¬
Revenue Act of 1950, a number der the
authority of the Defense
of corporations granted restricted Production
Act, the will of Con¬
stock options to executives.
In gress will be plainly thwarted."
doing so, they were dairying out
a
program
which had received
DIVIDEND NOTICES
specific
Congressional approval
passage
met, any gain realized by the op-
Restricted stock options granted
zation
investment transaction.
an
"Following the
au¬
130A,
Section
from
grant
by American corporations to exec¬
a
rate.
coupon
thorizing
realizable by option holder is not
Produc ion
Michigan Consolidated Gas Co.'s
of the Internal Revenue
'restricted
Committee
Labor Day.
smattering
a
[ new corporate
\
to
extremely dull,
was
only
Options Exempt
From Salary Board
is
business
39
the
mortgage bonds.
The
(539)
TEXAS
EASTERN
40
The Commercial and Financial Chronicle
(540)
Thursday, August 9, 1951
.
BUSINESS BUZZ
Business
OTL
—
reached
Such
In the
the
tentative decision
by the White House to
of
•
And, You
from the Nation's Capital
WASHINGTON, D. C.
•
Man's
BeVind-the-Scene Interpretations
light
•
bill
a
was
Bookshelf
passed in 1949.
American
However, a House Judiciary sub¬
committee
the
pigeon-holed
A.
pro¬
vitation
The
the
global
by
tb.e boards is that if the people
and Congress would stand for a
•defense program
of $50 billion
plus, the United States, by build¬
ing expanded production capacity
as well as arms, would find itself
by late 1952 or early 1953 in a
position to "have guns and but¬
ter, too." This oft-repeated prom¬
ise was last mouthed by Manly
Fleischmann, Defense Production
Administrator,
when
he
an¬
nounced the fourth quarter allo¬
of
latest
big
which will
promises
cations for
go
now
steel, copper, and alu-
Fleischmann said:
*mnum.
"Materials
the
for
needed
are
•expansion of productive capacity
basic
and
late
1952
resources
that
so
by
early 1953 materials
may be materially re¬
or
shortages
duced, if not eliminated, and the
economy expanded so that it can
the defense program and
permit
normal
levels • of
carry
also
farmers
to
to
renege
until
This
*
.y/v-V
1951—all
PHA
Ozanne—Operating
Washington
hard
though the
the
Budget, and
to
postpone
Into the limbo of years hence, the
time when the government's de¬
fense
expansion
will
stabilize,
on.
SAN
"—and
raise
a
would
of
enable
life—food,
and
to
me
shelter,
without
even
Hence
ever
figure between 5,000 and 50,-
000
units
the
what¬
conferees
the
on
appropriations bill for fiscal
1952
actually settle upon*
fresh crisis.
a
the
he
>
promise
*
*
*
of "guns
and butter too" virtually repu¬
Industry sources here
assert
diated even before Congress has that
Manly
Fleischmann,
DPA
approved the $60 billion of de¬ Administrator, has actually allo¬
fense
more
steel
for
the
appropriations,
takes
its cated 25%
place alongside certain other re¬ fourth quarter than actually will
be
available.
The allocation was
pudiated major promises, such as:
(1) If the United States assisted
in defeating the Axis powers and
Joined the United Nations, world
would be restored.
peace
(2)
If the United
States
parti¬
cipated in and contributed toward
the
World
Bank
and
Monetary
Vund/ there would follow
struction
recon¬
„
of the
would
not
be
used
in
the
intentioned
people
proposed!
4t to go its
(4)
If
stability quarter.
currency
own.
The
a
couple of months ago to chuck the
trick
excuse
for this clever little
that it would take weeks
was
kit and caboodle of wage of study to determine how to ap¬
price controls. But the oppo¬ ply regulations under the new act.
sition leadership objected. It fig¬ The real purpose of this "smart
whole
for
ured
that
then
saddle
the cost of
Their
sure
Truman could
them with
blame
\
living rises.
course
was
if
move," however,
j
thus to pass a
on
the spot, so it would have
come
in and ask for higher ceil¬
ness
to
ing
prices
entitled
price
neither
the
Administration
nor
Some
shortened
United
States
made
supply
allotted
the
to
would make it possible
to avoid the vast expenditures of
tens of billions necessary to main-
on a semi-military
should not lead
business
to
"price
Now
that
the
DPA
new
the books, its basic
setting should be borne
act
was
political gest
on
on
control"
which
to
the
under
sus¬
ment
officials
small
business
the
would
$4
some
annually
be
billion
There never was
sufficient, with
of military
aid of using controls for
from the
U.
'
it
would
law,
to
let
so
be
that
via
contracts
Senate
around
•a
bill
committee
with
which
the
idea
would
action
last
row was on
year
meat—both items
in
months
if
not
years
proposal
could
is
of
passing
create
get
that
into
a
sys¬
farmers
the
in
Federal
courts, which would fix a "reason¬
able annual rental" farmers
would
pay
the
in
lieu
court
of
would
rental among
their
debts,
divide
down in its wage rises.
evidence
of
that
is
to
another,
Corporation the claimant agency
and distributor of scarce mterials
for "small business."
ter is
Inc., 314 North Broadway, mem¬
bers of the Midyvest Stock
Ex¬
change.-,:
:
<V
'
-
With First Trust of York
(Special to The Financial Chronicle)
YORK, Neb.—Robert V. Jones
and James S.
Hice
First Trust Co.
coln
are
with
now
of York, 529 Lin¬
Avenue.
Joins Westheimer Co.
(Special to The Financial Chronicle)
1
CINCINNATI, Ohio
—
Charles
E. Mueller is with Westheimer &
Co., 326 Walnut Street, members
of the
Stock
New
York
and
Cincinnati
Exchanges.
v
Cf
For
Large Appreciation Potential
For another,
competence"
and
on
that
a
of
prospective
government contract,
any
certification
upon procurement
is binding
officials.
WE SUGGEST
(This column is intended to
RIVERSIDE CEMENT CO.
CLASS B (common) STOCK
A
leading producer
In
of cement
fast-growing Southern
California.
70':"'^
Analysis of this Company and
a
review of
try
the Cement Indus¬
available
on
request.
Selling about $14.00
re¬
flect the <(behind the scene" inter¬
LERNER & CO.
pretation from the nation's Capital
and may or may not coincide with
10 Post Office Square, Boston 9, Mass.
the "Chronicle's"
own
views.)
Investment
Securities
Tel. HUbbard 2-1990
up
mal
excuse
Farm
be
held.
regards
tentative
advanced by
prices likewise
labor.
could
Mr. Truman, to be
the
legally
-
not
sure,
entrenched
formula of parity was less regard
this
than
the
Allied Electric Products
FIRM TRADING MARKETS
Beneficial
A further
the
and
the farmer's credit¬
ors.
^
LOUIS, Mo.—James D. Rutwith Stifel, Nicolaus &
Co.,
if
demanded them. For
it refused to make the
that,
fussing politically, labor could not be held
is
adjustment for farm¬ decision of the Wage Stabilization
ers, against the day when a de¬ Board the other day to allow just
pression might again hit farmers. about any wage rise for any nor¬
The
ST.
any
tem of debt
debt
Stifel, Nicolaus Adds
this agency
'■
many
A
~
intention
an all-around
"hold
the
line"
effort
against in¬
S., to stop
flation.
It has been apparent for
Kussia.
'
Fran¬
agency
automobiles, and the big¬ bidder
,
gency,
San
auto
mind selected because of their political
in trying to figure out what will
basis.
appeal.
1
• ■
!
(5) If the United States joined transpire under it.
Regardless of what the DPA
This basic setting is that Con¬ law
the
North
Atlantic
says, the Administration will
Treaty Or¬
ganization, this fact of an alli¬ gress was confronted with a phony use "price control" constantly and
proposition and responded with a in every way possible to try to
ance, even without sending
troops
to Europe prior to a war emer¬ phony proposition.
put business on the spot.
The
Jam the nation
and
(Special to The Financial Chronicle)
to put busi¬
was
pect, however, that "price con¬ it removed the
agency's power to
industry is this: the auto in¬ trol" will
the sacrifice of the Marshall Plan
give them no trouble.
compel RFC to make loans for any
dustry is the largest source of
For
for four years, by 1952 Western
the
fundamental
back¬
purpose upon its recommendation.
steel scrap, and to the tune that
Curope
would
get
on
its
feet
ground fact is that price control
this
On
the other hand, the new
industry's
operations
are
under any law will, as in the past,
economically, be in an economic
Small
Defense Plants
curtailed, scrap supplies will be be used
Corp., is
and psychological position to build
primarily for purposes of
somewhat curtailed.
nevertheless, a potent agency. It
up its own forces to stop Russia,
political effect. Note that the first
can certify both the
>•••. v ••'i.Y-;,/
*
*
*
: d.
"credit and
and this
the
Calif.—
and
industry sources Congress wanted done.
The practical statutory limita¬
with multilateral trade.
contend that actual steel avail¬
(3) If the United States loaned able will not exceed 19 million tions
supposedly
barring price
Britain $3,750 million this would tons.
regulation (if economic conditions
put Britain on its feet and enable
put upward pressure on prices)
One
incidental
effect
of
the
and
New York
ship Septal.
control bill which would
business would be blamed for the
control only the occasional and
rare case of genuine price goug¬ higher prices.
for in excess of 24 million tons.
ing. At the same time they gave
This allocation was against an Truman a bill which, while de¬
Congress drew some of the teeth
official predication that 21 million void of substance, could be called from the Smaller Defense Plants
a
wage and price bill. In this way Corp. proposal before enacting it
tons was available, and was pur¬
For one thing, it re¬
posely
"over-allocated"
on
the they may be able to escape the into law.
Truman curse that Congress alone moved the
theory, based on War II experi¬
power of the agency
is responsible for not doing what to in substance
ence, that 3 million tons of alloca¬
compel procure¬
tions
FRANCISCO,
Hoffman
&
cisco Stock Exchanges, will admit
Winston Casey to limited partner¬
television!"
of public
units PLUS
C.—384 pages,
and tables—
Goodwin,
Montgomery Street, members
265
the basic
clothing,
procure
be
will
90,000
D.
index
,
Walston,
cans or Dixiecrats who do not love
most striking example of this was
proposed ex¬
the adoption of all the price regu¬
50,000 by the Senate—applies only him, anyway.
pansion will be in the Air Force
lations based upon the old DPA
to operations in fiscal year 1952,
So,- confronted with a practical
rather than in the total program,
the total public housing construc¬ exemption
of labor and farm act, on the eve of the signing of
it is bound to put increasing pres¬
tion program actually under way products, a good many seriously- the new act.
sure on all metals, on manpower,
Even
financial
and
than 100 Ameri¬
Walston, Hoffman Admits
authorized—
5,000 approved by the House and
to
4,
cover,
$6.00.
1951—
necessities
in number
on more
companies for 1950, with
showing company reserves,
production, refinery throughput,
etc.—Petroleum Industry Projects,
P.
O.
Box
829, B.
F. Station,'
a nice back¬
than 90,000 public
units "started", few of
of course, are very far
reduction
Com¬
—
oil
can
Since the proposed Congression-;
al
The
tables
more
housing units
civilian production."
1951,
Record,
statistics
got themselves
which,
along.
of
first
the
in fiscal
Bank
piled under the direction of Henry
counting
develops that
calendar year 1950 and
Foreign
5, N. Y.—Copies on request.
Oil
recently
now
log of
housing
Switzerland—Union
York
*
column
of
Y.—
of
would be authorized in fiscal 1952.
half
42nd
Street,
Switzerland, 14 Wall Street, New
reported
(July 26) how the Public Hous¬
ing Administration got more than
42,000 public housing "starts" list¬
ed in June, 10 times the monthly
average, when it became appar¬
ent
Congress
would cut below
75,000 the number of public hous¬
ing units, construction of which
It
Book
Dr. A. Schaefer of the Union Bank
clearly exists.
*
McGraw-Hill
Capital Investments in
therefor
need
the
—
Countries—Reprint of address by
on
their debts,
and no debt relief
legislation will be let out of com¬
mittee
Policy—E.
Monetary
Goldenweiser
Company, 330 West
New York 18, N!
Cloth—$4.50.
position. It is set to bury any
build-up, it is being noted on the such scheme if the Senate tries it
once
more.
The House Judiciary
Hill, and with no thought that it
Is funny, that the Truman Admin¬ subcommittee has passed the word
istration has developed the stra¬ that it will issue no statutory in¬
•expand the goals of the military
tegy "of the promise."
i
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