Full text of Commercial and Financial Chronicle : December 10, 1959, Vol. 190, No. 5906

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

he COMMERCIAL and FINANCIAL
i

Hit

OF

UNlVERSn i
Ml OHIO. AN

111959

DEC

PERIODICAL
reading
\S\ADLISHED IS J!)

Ret7. u. S. Pat. Office

New York 7, N. Y., Thursday, December 10,

Number 5906

relume 190

AS ,WESEE IT

Trl

ROOM

it. before
before setting1 forth uoon his extensive
Juit
setting forth upon his extensive

1959

Price

50

Cents

a

Copy

Copper Strikes Bring Silver
XX

trnvpls

travels, tFp
the

^nsident had this to say:

Issues to the Fore Again

lOf

these (various current) problems, one cries out
immediate solution. I refer to the labormianagement

foi

iispute that is still unresolved in the steel industry.

lly-Herbert M. Bratter

Senate.

miners

The

desire

two-step

a

program:

Stop Treasury sales to industry, thus making
industrial consumers buy their silver on the open
market
at
free
market prices;
(2) compel the
Treasury to issue silver certificates against all the
"free silver" it now holds, with the result that it
will have to go into the open market and buy
whatever silver is needed for subsidiary coinage
and pay for it the going market price.
(1)

The troublesome controversy

4

'Responsible citizenship' in a free country means
It means conducting one's self responsibly
the interest of others, as well as self. America will

in

is

hot—indeed, it cannot—tolerate for long the crippling
if the entire economy as the result of labor-management

lisputes in any one basic industry

or

any

explained by Mr. Bratter who is long conversant with the

subject. His review of current developments spotlights:

the

dispute between "silver users" and the "silver miners";

the

attempt by the latter to stop Treasury sales of free silver to
the former at

of in-

group

S|!

the

"Among

free people there is no one man, no one
industry, no one interest that measures in

[spirit of free collective bargaining, they will act
or

else, in due

course

see

has

labor and
in these disputes, to adjust responsibly

ury

up to

"The nation is determined to preserve

free enterprise,

and

management alike

we are to do this,
must see to it, in every

[of employes,

[achievement

of

of

a

both

segments must realize that the

(Continued

/

securities

on page

and

the

silver

scarce,

the

it

for

not

silver to

and by commodity traders.

The silver users, who
association, were behind the
1946 law that first empowered the Treasury to sell
silver to industry. They of course oppose the prop¬
osition that the Treasury cease selling unmonetized silver to industry at 91C an. ounce so long as
silver purchase laws are on the statute books. What
would please silver traders, particularly members
of the Commodity Exchange, Inc., would be repeal

muve.

Treas¬

the

intensified

1934

tial

Government,

Treasury

industry, the

with

ments

demonetized

metal to

demand

would

What the

Herbert

M.

Bratter

But

dustry by virtue of powers

granted by a 1946 law

keeping the world price of silver

This

riles

the

in

bloc

silver

the

—.

Municipal

STATE AMD MUNICIPAL

Securities
telephone:

Mining Congress Wants

Municipal

Lester, Ryons & Co.
623

BONDS

Members New

BOM)

monthly

I»K PA HTM KMT

SO Broad Street

New

York 15

MEMBERS NEW

15 BROAD
CABLE-

STOCK EXCHANGES

STREET, NEW YORK 5,

N.Y.

•

DI 4-1400

•

Bond Dept.

Teletype: NY 1-708

To Dealers,

Distributor

Dealer

Inquiries Invited

New

Maintained
Banks and Brokers

1832

Stock

Block Inquiries

Invited

Commission Orders Executed On All

Exchange

CANADIAN

STREET

Y.

<£outfm>e4t company

DIRECT

WIRES TO

MONTREAL AND TORONTO

Goodbody & Co.
MEMBERS NEW YORK STOCK EXCHANGE

BRIDGEPORT

THE

Southern

Chase Manhattan

Correspondent—Pershing

BANK
&

Co.

Consumers'

Gas

Company

•

PERTH AMBOY

offer

expire

buy the above rights
on
December 18, 1959

to

the

current

MunicipalBonds
FOR

CALIFORNIA'S

which
CIVIC

at

market.

IMPROVEMENT

Direct Private Wires to

Toronto, Montreal,
Ottawa, Winnipeg, Calgary, Vancouver,
Victoria

and

Halifax

DEPARTMENT

Teletype NY 1-2270

BROAD

NEW YORK 4, N.




on

Rights

securities

Securities

dallas

York

The

Canadian Exchanges

25

Department.

HAnover 2-6000

We

New York Stock Exchange

American

Bond

California Securities

canadian

t. l.WATSON &co.
Members

first

Santa Ana, Santa Monica

(Toronto, Canada)

ESTABLISHED

Investment

0A

Notes

TELETYPE NY 1-2262

COBURNHAM

Net Active Markets

Underwriter

San Diego,

OF NEW YORK

Company

YORK AND AMERICAN

Bonds and

Pasadena, Pomona, Redlands, Riverside,

THE FIRST NATIONAL CITY BANK

Burnham and

I

Encino, Glendale, Hollywood, Long Beach,

letter

COMPANY

US?

Agency

Exchange

Offices in Claremont, Corona del Mar,

view

|B|J|

Housing

York Stock Exchange

Pacific Coast

Members

burnham

NEW YORK

TRUST

Street, Los Angeles 17,

Associate Member American Stock Exchange

THE

CHEMICAL BANK

So. Hope

California

HAnover 2-3700

sell.

State,

a

Housing,

State and

That 50%

Although mining interests have been subsidized
for years they never relax their efforts to go out
after more.
A resolution passed by the American
Mining Congress in September seeks to get the
Treasury to stop selling silver to industry at any¬
thing less than $1.29 an ounce, as compared with
its selling price of 91b.
If the Treasury acceded,
the
price of silver all
(Continued on page 26)

and Public

Public

enacted in

impossible to continue trading in silver

REGISTRATION- -Underwriters, dealers and investors In corporate
complete picture of issues now registered with the SEC and poten¬
undertakings in our "Securities in Registration" Section, starting on page 38.
-

afforded

are

was

part of the Silver Purchase Act.

IN

NOW

SECURITIES

an

futures, which is the business of the Commodity
Exchange.
Prior to 1934, during the period when
silver purchases were being advocated in the Con¬
gress,^'the Commodity Exchange provided a futures
market where demand and supply could be paired
off by producers, users, speculators and govern¬

silver

rising.

as

tax made it

the shies which
Treasury is making to in¬

from

in

imported metal.

have the result of

31)

organized

of the silver transactions tax. which

would have to fill

world

mining interests here and abroad,
affecting silver are being watched
so-called, "silver users"—

manufacturers—the

are

been

happen.

voluntary settlement fair to all is

Mediation and Conciliation Service

inflationary

prices to
rise. American mining interests
would' be
happy to see that

*

critically important to the entire nation. Indeed, it is
so
important that I am instructing the director of the

U. S.

of

cause

leaders

the market;

by

freeze Treasury silver which is held to be

its needs from
The

❖

developments

copper

latter today

The public will not stand for less.
*

'The

has

Were

that the public interest is as
the interests of stockholders and

as

buying silver on

become

sales

[dispute and settlement,
carefully protected

Apart from

the

trying to make something out
of the situation. 7
,

[including free collective bargaining. If
labor

accu¬

called upon to
supply large amounts of silver
to industry and mining inter¬
ests are busy behind the scenes

land equitably their differences.
I

the

ounce;

strikes have shut down mines,
smelters
and
refineries
through
which
U.
S.
newly-mined silver finds its way to the market,
the "white metal," nowadays used in a growing
number of industrial products,

respon¬

their countrymen will

[to it that they do act responsibly. It is

[management,

of

Because the

"So, my friends, the choice is up to free American
employers and American employes. Voluntarily, in the

sibly;

need

an

Importance to America.

an

Treasury can successfully employ to obviate

miners' attempt to

our

>roup, no one

the

measures

❖

anything less than $1.29

of the subsidy charge used by the silver miners;

racy

lustries.
sis

underlying the perennial silver

situation, this time brought to the fore by the copper strike,

illat it says.

2 BROADWAY

1 NORTH LA SALLE ST.

NEW YORK

CHICAGO

Dominion Securities
MUNICIPAL BOND DEPARTMENT

(5 rp oration
Associate Member American Stock Exchange

40

Exchange Place, New York 5, N. Y.

Tel. WHitehall 4-8161

Tele. NY 1-702-3

Bank

of

America

N.T.& S. A.
San Francisco

Los Angeles

2

The Commercial and Financial Chronicle

(2398)

For Banks. Brokers,

The Security I Like Best...

Dealers only
.

.

A continuous forum in which, each week, a different group

.

in the investment and

Traders Say

'

i

•

•

-

For the combined

J.

advantages of:
than

more

0-T-C experience.

Nationwide private wire system.

4.

Broader

again,

the

over

decades great for¬
made, as a result

tunes have been
of

invention

new

a

of

or

im¬

an

Fast, dependable executions.

nological improvement Of
an existing device.

New York Hanseatic

to

Associate Member

from the be¬

American

Stock Exchange

ginning in

120 Broadway, New York 5
WOrth 4-2300

Teletype NY 1-40

BOSTON

•

PHILADELPHIA

SAN FRANCISCO

•

Private Wires to

it

Principal Cities

is

market

such

& CO.

INC.

and
Bradford

G. J.

on

In the case of Jamesbury

the inherent risks of

N.

7.

few

Security Dealers Ass'n

companies

young

tained

Members

enviable

as

rela¬

a

have

at¬

record

a

as

Bids

on

The development of the mod¬

Phone:

WHitehall

ball valve

ern

3-7830

the

as

Teletype No. NY 1-2762

most

the

valve

be

gathered

ad¬

industry
Its far-reaching poten¬

in 60 years.

tialities

revolutionary

in

vancement

may

basic

some

has been heralded

from

industry forecasts.

The American valve

Trading Interest In

Bassett Furniture Industries
Life Insurance Co. of Va.

LD 39

-5-2527—

Private

Wire

TWX LY 77

New

to

York

City

displace present prod¬
the

over

Such

forecast

WANT INFORMATION ABOUT
CANADIAN SECURITIES?
17

Canada,

offices

our

throughout

firm line

a

first-hand

familiarity with the

entire

would

securities

market.

handle transactions in

all

We

Cana¬

where

This

corporate

and

we

including stocks,

and municipal bonds,

will

he

glad

to

supply

informalion about
specific issues
of interest

to

you.

Call

or

write:

NESBITT, THOMSON
AND COMPANY, INC.
25 BROAD ST. 140
FEDERAL ST.

NEW YORK 4

out

for

$750

with

an

making these new devices.
Jamesbury is the largest civilian

that

if

but

a

is

It

valves,

readily

ex¬

apparent

the

company can
small
percentage

capture

of this
growing market, the
sales
and
profits potential is vast indeed.
A

ball

valve,

like

any
other
a control chamber placed

valve, is
on a pipeline to
regulate the flow
of liquids or
gases. The unique
of

ball

a

ball

valve is the

bearing

"needle,"
the

a

in

"gate"

a

or

place
a

use

of

a

"plug," in

ordinary valves made today.
advantages of a Jamesbury

The

itself

is

plastic

and

numerous.

in

(teflon)
are

and

wear,

are

sealed

The ball

between

seals

or

two

gaskets

self-compensating for
change of temperature
The

pressures.

housing

is

made of

bronze, aluminum, carbon
monel, P. V. C. plastic, and

steel,

stainless steel. As

plastic

seals

closure

a

a

result of the

perfect

leak-proof

is effected under all

con¬

ditions. Since metal-to-metal fric¬
tion is
eliminated, the valves have
a very
long life. No lubricants are
ever

required and maintenance is
to a minimum. The valve

kept
stem
for

compared

with

the

$2.1

profits

exception

year,"* operations

consistently

may be separately removed
repacking while the valve re¬

Net




as

a

Trans-Canada

great future.

needs

at

shares, per
earnings
have
increased
$0.09 in 1956 to $0.80 esti¬

share
from

mated for this year. In addition
to
the

parliamentary

altercation
which
followed closely both in Can¬

of

eastern

Canada.

This,

the

initial

year's throughput, will be neces¬
sarily small as utility companies
which Trans-Canada
supplies are
still
completing or expanding
their

distribution

systems.

Last

was 300 MMcf which
is exoeeted to climb to 350 MMcf

by year-end.
good start, but what of the
future you may ask? The antici¬
pated climb in demand is pretty

the

dynamic

potentialities it is appar¬
why this leveraged, specula¬

ent

common

may

be regarded

interesting capital gains

for the
venturesome

is

traded

in

as

vehicle

investor. The

the

Over-the-

Counter market.

Trans-Canada expects

maximum

will

daily

throughput

increase to 839 MMcf

in

the

season,
while a survey
undertaken
by
Commonwealth

1979-80 and 3,496 MMcf in 1987-88.

to

reserves.

Canada, caught the imagination
investors who,

of

exports

years

limited

The proposal in 1957
to build the
world's longest natural
gas pipe
line
stretching across most of

will

only be

line

capacity and gas
Already the FPC has

granted Midwestern a permit to
import gas through Trans-Canada
at

Emerson, Manitoba.

It

now

for
the
National Energy
Board to grant permission to ex¬

port

in their initial

burst

leum

en¬

thusiasm, took

tion

the
to

stock

$47;
this

gas

Province

by

Trans-Canada

much

of

Should
soon,

the

1960.

the

T

y,

d

a

around

on a

The

Sterling

pattern, the industry has
future.

I

see

no

a

reason

why it should not follow the U. S.
Canada has plenty of gas,

good demand and favorable

1958

the
tion

possibilities.
the

Reserve

At

the

ex¬

end

of

Committee

of

Canadian Petroleum Associa¬
estimated that
proven : re¬

serves

of

natural

gas

Consumer

Finance

Companies
lAie

seek for retail off-street place-

or

blocks

of

inactive

stocks

common

of

preferred
dividend-

paying small-loan companies, sales
finance companies, or factors.

ALBERT J.CAPLAN& CO
Members:
Boston

Stock Exchange

Phila.-Balto.

&

Pitts.

Exch.

Stock

1516

(Assoc.)

LOCUST ST., PHILA. 2, PI.

gas

make

Opportunities Unlimited
IN JAPAN
Write

for

our

Monthly Stock

Digest, and our other reports
that give you a pretty clear
picture of the Japanese
economy as a

whole.

Nomura Securities Co., Lt
61 Broadway, New
Telephone:
This

is

not

orders

BOwling

York 6, N. Y
Green

9-0187

offer or solicitation f°'
any'particular securities

an

for

ex¬

possible.

forthcoming

great

to

export

gas

company

increase

in

antici¬

pated throughput mentioned above
will, of course, require additional

but

Compared to the U. S. A., the
natural gas industry in Canada is
in its infancy but if it follows the
brilliant

Investment Bankers

to start
profitable basis the

year.

growth poten¬
tial has increased since that time.

trend.

the

operating

'1 neodore M.

to

be

Permission
enable

following

estimated

&

Broadway,N.Y.6COrtlandt7-56

could start to flow into
S. at Emerson by Nov.
1,

a t

level

same

permits

$25%,
realis¬

more

111

gas

U.

will

the stock is at

port

extra

the

ports

States.

a

Conserva¬

from

buying

the

Gas

remove

of

United

a

to

up

from

tic

Natural

Board

emanated

o

and

high

a

Tokyo,Japan
Brokers

re¬

mains

from this country and
permission of the Alberta Petro¬

of

Affiliate of

Inc., estimates that maxi¬
daily sales will reach 1,416
by 1969-70, 2,483 MMcf in

mum

MMcf

later

Trans-Canada Pipe Lines Limited

Company

York, Inc.

Services

another 200 MMcf per
day during
the initial years of
operation. In

Partner, Watt & Watt
Toronto, Ontario, Canada

write

1962-63

Exports to the U. S. A. would ad"

T. M. STERLING

information

or

Yamaichi Securities Co., Ltd.

ment

A

that

Reflecting

of New

throughput

impressive.

branch offices

Yamaichi

industry concentrated in

par) and $24,000 of 5% notes to

a

Call

Securities

The pipe line
completed in October, 1958, makes
natural gas available to 60% of
the Canadian population and the

common,
the
capitalization
consists of 2,000 shares of a
6%
cumulative preferred stock
($100
bank.

current

ada and the U. S. A.

areas

Birmingham, Alt

our

intro¬

no

put reached 265 million cu. ft. per
day.
This
fall
average
daily

are

For

"

,

duction to the financial
world, for
it was born amidst considerable
was

{

NYM557

JAPANESE
STOCKS

requirements, is
a

$200,000 compared with $.70,000
last year. With a
tight capitaliza¬
tion of 256,000 common

taxes

were

23%

trillion

cu. ft., while
Imperial Oil
estimated that remaining recover-

circumstances to be construed as an
offer to sell, or
solicitation of an offer to
buy, any security referred to herein.)
no

gas
destined to have

Exchanlt

Mobile, Ala.
Direct wires to

Lines, which
large proportion

January maximum daily through¬

after

BOSTON 10
(This is under

of

have

profitable.

transport

Canadian

estimated

some¬

now

ball

at

projected at

are

With

first

to

estimated 1959 volume of $10 mil¬
lion for the four or five companies

of

$1,750,000

million last year and
only $35,000
in 1955, the year the
company was

this

$600 and

compares

to

years.

work

volume

between

which

dian securities,

five

segment of the industry to

ball valve

Canadian

next

sales

feature of

With

million

,

annual

clusively.

...

installa¬

one-out-of-five

1958

Sales for the 1959-60 fiscal
year

stock

in

manufacturer

Institutional Investors

in

(ending June 30)

devices may

million.

LYNCHBURG, VA.

tiny

a

the

30, 1959.

$4.5

of

present

although

$180,000
June

an

an

STRADER and COMPANY, Inc.

at

submarines. Reflecting this, back¬
log of orders has increased from

tive

tions,

Commonwealth Natural Gas

is

fraction of the total but industry
sources
indicate that these new
ucts

and

gas

&

Excham

St., New York 6, N.

New Orleans, La. -

3.2

a

Ball valves

today represent

to

compared

Pipe

growth

$2.2

1980,

will

paper,

billion
annual growth rate of about 7%.

a

American Furniture

industry is
business, with an

by

and

industry. Major

American Stock

requirements
increase 18

will

gas

feel, therefore, that

been
was

Canadian

times forwoil; I

the

man.

Exchange Place, New York 5

cross-sec¬

that

natural

Trans-Canada

organized.

and we do not know
with a brighter potential

organized five
manufacture a ball
valve, of a unique design, invented
by its President, Howard G. Free¬

Odd Lots

American

of many

Jamesbury
years ago to

(Active and Inactive Issues)
40

respected and successful
of

New Yo'rk stock

Members

HAnover 2-0700

market

markets include the chemical,, pulp

Jamesbury,
future.

BONDS

1,000

over

cate

to

GROSSMAN

enough to last

or

years at the 1958 rate of consump¬
tion. On the demand side, present

of

Members

.trillion

times

virtually

predominantly
company's
products have been specified by
the U. S. Navy for use on nuclear

tively new venture, may expect
participate in the pronounced
growth phase, so characteristic of
a
successful new business.
Very

WEINBERG,

ft.

cu.

400

were

research and projections
by the Gordon Commission indi¬

civilian

Corp., the investor willing to as¬
sume

used in

are

Steiner, Rouse
19 Rector

reserves

industry and at the present
time the company's list of cus¬
tomers comprises the oldest, most

ness

devel¬

a

M. Sterling, Partner, Watt &
Watt, Toronto, Canada. (Page 2)

every

food and

to

capitalize

Bought—Sold—Quoted

T.

able

electric,

Securities

Pipe Lines Ltd.

temperatures

.V

,

actuators of its oWn

or

Louisiana

Blair &
York
City.

New

Trans-Canada

passing

petroleum,
beverage processing, and
public utility industries. The busi¬

an

objective of

opment.

S.

and pressures.

tion

enterprise the
which

CHICAGO

extreme

under

use

manufacture

vestor may be

participate

fluids

the

hydraulic, and pneumatic remote

sionally, the
sighted in¬
fortunate

distilleries,
danger of con¬
or

George

—

Analyst,

through the valve: It also permits

controllers

Occa¬

Established 1920

is

of

Co.,
Inc.,
(Page 2)

r

refin¬

as

Bradford,

„

far

Corporation

there

such

Jamesbury valves and

;

impor-.

particularly

beverages'

tamination

portant tech¬

Coverage.

is

industries

in

where

time

past "several

3.

lubricants
tant

eries,

Jamesbury Corp.
and

The absence of

mains in the line.

Analyst, Blair & Co., Inc., N. Y. City
Members New York Stock Exchange

Time
39 years

Alabama &

Selections

Jamesbury Corporation
GEORGE J. BRADFORD

400 unlisted securities.

5.

Their

participate and give their reasons for favoring a particular security.

'

Primary markets in

2.

•

Participants and

advisory field from all sections of the country

"HANSEATIC"

Call

1.

of experts

Week's

This

Forum

If it's Over-the-Counter

Thursday, December 10, 1959

...

financing.

By 1963 it is expected

that
present
capitalization
will
have been increased
by $250 mil¬

lion, which includes $135 million
required for the purchase of the
Northern
of the

the

Ontario

line

quite

section,

a

part

originally financed by

Canadian

Government.

probable

that

It

common

or

preferred stock will be issued next
year.

In this respect the
company

states

that assuming the
tory pattern follows t^e

tional

rate

base

formula,

Over-the-Counter

is

regula¬

Quotation Services
for 46 Years

conven¬

it

will

strive to maintain an
eouity ratio
of between 15 and 20%. The
views
of Canada's National

National Quotation

Energy Board

rates have not been announced
yet but I assume that it will be

equitable and will give sufficient
Continued

on

page

11

Bureau

Incorporated

on

Established 1913

46 Front Street
CHICAGO

New
BAN

York 4, t

Volume

Number

190

5906

The Commercial and Financial

...

Chronicle

(2399)

CONTENTS

Superficial notions about the capital gains tax that
Of maximizing its usefulness

—Herbert M.

in the

may stand

legal and economic problems arising from how the tax treatment
gains and losses works out in practice are shown to be

The Capital Gains Tax: Some

••—Harold

••

•

THE

The

.

Misunderstandings

\

-

-

his

•

Cooper-Bessemer Corp.—Ira U. Cobleigh.

why the tax

capital gains may exceed the

on

com¬

5

.___

manner,

special attention to the

pays

in which the capital gains tax influences the
obtainable

bonds purchased at a

on

*

"

99

10

/-The Right Investment Tests for City Real Estate Values

actual yields

discount.

Ahead

—George S. Moore.___________

y

monly accepted peak of 25%; illustrates the dangers to investors in

overemphasizing tax considerations, and

International Trade Flow in the Years

t

».

—Roger W. Babson..___

<

MAN

Always sells

obsoletes

99

Wall.

Obsolete Securities

Dept.

at

3

cated than what meets the casual eye. Thus, the economist and lawyer
shows when and

TENTH

.Cover

—

Someisi..-__^_^J

M.

on

compli¬

more

Bratter______^_...:

COMPANY

Smart fellow!

exposed by Dr. Somers. The

are

AND

Copper Strikes Bring Silver Issues to the Fore Again

Buffalo, and Member of the New York Bar

way

uLlCHTfUSTflU

Articles and News

lly Harold M. Somers. Ph.D., LIj.B,*' Dean ami Professor of
Economics, School of Easiness Administration, University of

3

STREET, NEW

YORK

Telephone: WHitehall 4-6551

'

"

..

WALL

12

_

•

Municipal Bonds' Immunity: Some Current Problems

selling by the,

Much year-end tax

sndll investor is ill-advised. It is

misunderstanding

Form 1040, which deals with gains
and
losses
from
sales
or* ex¬

Measures

changes of property.
- %
'
The simplified statement'of the
tie capital gains tax^The actual;
rule
holds
time
tax treatment
only when
a
of
long-term capital gain is taken in
capital
isolation from all long-term losses
ga i n s and
tosed

on

a

of

lasses is more

and

complicated

losses.

ttan J appears

capital, gains

or,

the surface.

h

particular,

from

the

instance,

is

year

long-term

if

the

transaction

realization

the

gains

25%

rates.

long-

on

is

bears

close

this

$5,000,

or

Thus

the

one-half

of

the

gain.

full

of

the

hold),

appreciation

Somers

practice is an essen¬
prerequisite to an analysis

its

effects

economic

to

and

investment decisions that take full
of

account

the

all

tax

consequences.

Term

Tax

Capital

Gain

Long-

a

Exceed

May

„.25 Percent

„

It

On

Rate

sometimes

is

said

often

and

misunderstood that the maximum
tax

rate

long-term capital
gain is 25%. That is incorrect: A
particular long-term capital gain
may sometimes subject the tax¬
payer

25%

to

a

and,

full tax

high

as

on

a

tax far in

in fact,

excess

be at his
which goes

may

bracket rate,
as

of the

face

of

widely accepted thinking

it warrants

The

detailed

effective

term

tax

explanation.
on
long-

rate

capital

gains is apparently
by giving the taxpayer a
deduction of 50% of the gain. If
reduced

the deduction
of the

were actually 50%
long-term capital gain, then

the effective

gain would
tax

tax

be

bracket,

or

rate

half

on

the

half

e.g.

the full

marginal

40%

of

20%.
In

is

fact, however, the deduction
not simply 50%
of the long-

term gain. It is 50%

of either the
long-term gain (net of longlosses) or the net long-term
gain after deducting net shortnet

losses

complicated

with

simple

the

at

Now

fax

accordance

provisions,

requirements

of

with

the

Schedule

Businessman's

tax

In

fact,

will

taken

to

or

have

specialized in

no

more

There will be

of

account

tax

will

would

it

taken

that

be

than

Stocks.......

Bookshelf

47

.

no

Reporter

Our

Governments.

on

Our Reporter's

Railroad Securities

addition

the

To

Newark




Electronic
*

capital gains

— ——

—

Thus

Security

*

—

&

*

-

33

—

for

the

benefit of the

full

and

short-term

above

losses.

Continued

of

Corner.______—____1—

on

.

.

.

and

Los

Security I Like Best.

4

The

State of Trade and Industry—.

Schenectady

Angeles

to

Dallas

Philadelphia

:

St. Louis

!!:Column

page

Worcester

4

__

6
48

...

not available this week.

QV)R 'A

22
Twice

FINANCIAL
B.

WILLIAM

Weekly

19&9 by William B. Dana

Copyright

Company

CHRONICLE

Reentered

COMPANY, Publishers

DANA

Place,

Park

REctor

GEORGE J.
WILLIAM

New York

2-9570

7, N. Y.

Thursday,

<

Subscriptions
Possessions,

10,

and

Other

Chicago

Office:

3,

111.

135

South

(Telephone

Other

Bank

$45.00

STate

St.,

2-0613»

and
per

rate

U.

S.

Members

of

per

$68.00
per

year,

per

in

year.

year.

-saving^

Publications

Quotation

year.

Note—On
the

La- Salle

Febru¬

States,

and

$65.00

Canada,
Countries, $72.00
Other

city news. etc.).

United

Union,

of

1959

Thursday (general news and ad¬
vertising issue) and every Monday
(com¬
plete statistical issue — market quotation
records, corporation news, hank clearings
Every

state

in

Territories

Pan-American

SEIBERT, President

December

matter

Subscription Rates

to 9576

MORRISSEY, Editor

DANA

second-class

as

25, 1942, at the post office at New
York. N. Y., under the Act of March 8,1879.
ary

Dominion

.

Glens Falls

2

;

This

f

N. Y.

TELETYPE NY 1-5
Chicago

inc.

17

,1..

CLAUDE D. SEIBERT. Vice-President

Exchange

Cleveland

San Francisco

32

You—By Wallace Streete

The

Washington and You

1868

YORK

st

40 Exchange Place, N. Y.

Direct Wrircs

44

Tax-Exempt Bond Market—Donald D. Mackey...

capital
example, the
taxpayer should defer his gain
until a year when he can take it
in isolation from long-term losses

Stock

ue

Teletype NY 1-1825 & 14344

38

_

.......

MACKIE,

HA 2-9000

19

...

Salesman's

The Market

capital gain
is paying a
having taken a

the

NEW

Re q

if he had not

lie

gains in

York

on

Singer, Bean

33

—

Prospective Security Offerings._-.____—

reduced rate for long-term

net

Prospectus

Capital

5

i.—

Chicago

long-term

$300

get

TELEPHONE IIAnover 2-4300

Nashville

Century Chemical*

22

.

Securities Now in Registration....

long-term gain of $1,000, i.e. 30%.

Founded

Boston

12
46

—2

Report..

Public Utility Securities—..

Spencer Trask &. Co.
ST.,

9

28

Reg. U. S. Patent Office

Albany

Activity..—

Observations—A. Wilfred May.;.

-

New

Burndy Corp.

8

News About Banks and Bankers..
'

PREFERRED STOCKS

Members

8

...

Recommendations.

The COMMERCIAL and

BROAD

26

.

Mutual Funds _l._—...

25%.

$300 greater than
been

have

year.

of

tax

Broadway, New York 5

'

25

25

J.F. ReilIy&Co.,Inc.
DIgby 4-4970

of Current Business

Published

For many years we

37

and losses. The result will be that

his

oil

minerals

Cover

Washington Ahead of the News—-Carlisle Bargeron.—

Indications

He

against his
$300 in .taxes.

considering taking a
gain of $1,000
gain

at

on

beryllium

Pacific Uranium
From

subtraction from taxable in¬

come

.

Kellett Aircraft

there will be no' net
gain. There will be a
long-term gain deduction of 50%
zero.

.

37

48

_

Einzig: "No Sign of Adverse Change in Setback of Sterling"..

.

gain, and
long-term
of

&

a

however, the $1,000'.loss
offset against the $1,000

be

.

capital

and

rate

,

37

.....

Dealer-Broker Investment

loss

save

...

Coming Events in the Investment Field—_

;

would be taxed at half his regular

the
D

is

he

long-term

actual

including

and

.

(Editorial)

Insurance

and

.1

tax

bracket.

30%

the

It

'

?

alaska

:

•

President.

as

'

hycon mfg.

Mortgage Purchases While Its Sales Drop

James J. Lee

See

We

Bank

and is told that the long-term

maximum of 25%." Unfortu¬

a

the

offset

income

had

*

(Boxed)

<

20

Capital Spending Seen Going Up Substantially in I960.. 35

(Boxed).

i

18

'

A Communist Mess

•

s.

"

loss of $1,000
Suppose also that

year.

at

was

could

nately, the complicated statement
is in

the

capital

during the

taxed

are

year,

his

pn

taxpayer

long-term

that

statement

rate

the

pose

compared

"long-term capital gains

same

..

u.
.

'

'

7

"

..16

Rains

''Right Conditions"

As

long-term
gain, to the extent to which that
gain is offset by the losses. Sup¬

carryovers of any sort), whichever
is smaller. This
may appear to be

unduly

any

net short*

will subject him to a
equivalent to his marginal

loss

(including

were

or any

gain

bracket

oxford
chemical

15

39

taxpayer will find that the taking
a
particular long-term capital

term

term

there

term losses in the

/

.

Regular Features

of

he

91%.

Since this statement flies in the

however,

long-term losses

'■

■■

Deflation?

or

Energy's Growth in Europe's Energy Economy

IB A Elects

long-term capital gain of $10,000
(technically, 50% of 50% of the
full long-term capital gain).
If

Maximum

'

/■'

•

;—R. P. Perret—

FNMA Increases

tax which is 25% of the

a

"

•'

•

.

14

„

_

t

alternative computation
be made. This will, in turn,

may

.

Albert

NV

an

result in

„

New

certain

a

works out in

tial

Nuclear
v.

taxpayer's

of how the tax

M.

'In)1

servonics

„_

Employment Economy Requires Stable Housing

-Hon.

leaving

($18,000 for a separate re¬
turn, $36,000 for a joint return or
about $24,000 for a head of house¬

of

Full

a

is, in effect,
regular rates On

If

Adams.

Position

7.The Depletion Issue Today—Lowell Stanley.

level

Harold

—.13
Profit

Rising Interest Rates Cause Inflation

tax

the

taxable income is above

exam¬

ination. A full

M

Banks'

—G. Walter Woodworth

$5,000 to be taxed at the regular

maximum

'

Do

-

capital

50%

term

Tohin

Sustain

Sherman

-

only

statement that

of

—E.

during

the familiar

rate

J.

to

short-term

net

any

For

gain
of
say
$10,000, then the deduction will be

the

—Austin

;

,

Record

(Foreign

account

of

the

Monthly,
Postage extra).
—

fluctuations

of

In

foreign

exchange,
remittances
for
subscriptions and
advertisements

must

made

be

in

I

New York funds.

4

Food Price Index

nearly 2 y4 million cars in the
of 1960.
The magazine points out that
the auto industry normally takes
from 15% to 20%- of steel ship¬

Auto Production

ments.

first quarter

Electric Output

The State of

Carloadings
Retail Trade

and INDUSTRY

,

Business Failures

1958, its share of the
steel market was about 17%.
But

Commodity Price Index

in record-setting 1955, automakers

automotive

The

the econ¬

been

3%

than

more

above

year

omy's pre-strike records in out¬ ago levels in both Germany and
put, income and employment to be the Netherlands.
With the reappearance of price
regained and surpassed rapidly,
and wage pressures in a growing
now that steel production has been
resumed,
the
Federal
Reserve number of industrial countries,
Bank

of

York

New

in

observed

the December issue of its "Month¬

This, of course, as¬

ly Review."

that the steel

sumes

strike is not

the

toward

shift

straint

has

raised

October

more

re¬
pro¬

The German Federal

nounced.
Bank

monetary

become

its

discount

rate

in

point to 4%,
injunction expires on Jan. 26 and bringing it to the level already
that
transportation
is not dis¬ prevailing in the. United States,
rupted by a breakdown of labor the United Kingdom and France.
negotiations in the railroad indus¬ The Dutch and Japanese monetary
try.
of

confidence

the

by

full

a

authorities have also moved in the

...

..

Part

Taft-Hartley

the

after

renewed

in

a

direction of credit restraint while

quick return to high level activ¬

the

evidence that
total industrial output, personal
income, and retail sales have held
up well despite the steel and other
metals strikes. Cautious optimism
is also suggested by a new survey
of businessmen^ plans for capital
expenditures in 1960, which points

the United Kingdom have warned

due to

ity is

to

new

sizable

a

increase

steps, confidence abroad remains
high that the present growth will
not develop into an inflationary
boom.
Bank Clearings Up
1958

outlays.
second article, the Reserve
points out that a vigorous
economic expansion is underway
,

In

Bank

a

Bank

Sweden and

against a too rapid growth in bank
lending.
Partly because of these

1959

over

banks of

central

show

clearings

this

increase

an

9.4% From

Week

week

will

compared with

will keep the mar¬
ket vise-tight for the products in
greatest demand by automakers.
These include cold- and hot-rolled

sheet, cold-finished strip, and cer¬
tain grades and types of bars, par¬
ticularly forging bars and billets.
The
magazine also points out
two developments in the railroad
industry that will affect steel sup¬
plies.
First, a shortage of rail
cars will hamper steel shipments,
particularly in the East. Second,
railroads have come in for big or¬
ders for cars,; further tightening
the market for light plate and
structural.

New

orders,- not
yet announced -.finder the indus¬
try's system of disclosing orders,
may have hit 8,000 last month.
Mill
shipments are gaining
ground,
continuing the betterthan

expected

-

car

the
lag¬

of

recovery

steelmakers.

They are still
ging behind ingot production, but
are approaching two million tons
per week.
December should see
eight million tons shipped, "The
Iron Age" predicts.
This rate of shipments is not yet
reflected in immediate production
schedules. This is because inven¬

year ago.
Preliminary figures
tories and pipelines were so de¬
industrial compiled by the "Chronicle" based
pleted that stocks must be put in
countries.
Industrial
output
in upon telegraphic advices from the
chief cities of the country, indicate balance before full-scale opera¬
most countries is setting all-time

abroad

in

major

Industrial output in Brit¬

records.

ain

the

7%

was

higher in the

of this

quarter

quarter

year

period.

year ago

output

third

than in the

In France, third
5% above a

was

earlier, while in Germany
year-to-year advance was 8%

year

the

a

that

the

for

week

Satur¬

ended

of

the United States for which it

expansion

is

tries, as
activity;

well as in construction
However, business in¬

vestment in fixed

showing strength,

capital is

now

of

as an

industries

to the economic

are

upswing has

con¬

tinued to be provided by exports.
Western
European sales to the
United States during the first nine
months

were

42% above the level

above those of

the corresponding week last year.
Our preliminary totals stand at

ters

Week-End.
Dec.

continued

expansion

-000 omitted

.

1959

5—

.

1958

York—$14,688,406 $12,994,993

Chicago

___

Philadelphia
Boston

%
+13.0

1,388,094

1,272,048

+

9.1

1,191,000

1,118,000

+

6.5

848,145

778,832

+

8.9

Complete details of bank clear¬
ings throughout the nation appear
on

page

47 of

our

Monday, Dec.

and

in

several

wage

have

begun to appear.
Consumer and
wholesale prices, generally stable

negotiations

over

walkout

new

the

contributes

after

to

Fear of

80

days

of

recent mediation efforts.

"The

Iron

Age"

little hope of a
ment. With no
the

on

there

says

is

negotiated settle¬

yielding

controversial

2

-

in

sight

B

local

7, edition.
Auto

the

Industry Demand Will Keep
Steel in Short Supply

Availability

of

steel

for

many

their

ambitious

production

goals,

"The Iron Age" reports.

The

national

metalworking

industry

side

Mill

Operations
Of

Hit

92.5%

Capacity

Steel inventories in the nation's

This
1950

the

by

open - end
funds,
who
give a three-

the

should

(3)

Wilfred

A.

May

stock. Now the stock-cash alterna¬
limited

spreading out among the closedends. Adopted by Lehman Corpo¬
ration
and
Niagara
Share two
years ago, this policy is also to be
followed by Consolidated Invest¬
ment Trust, General Public Serv¬
ice, Insuranshares, and American

that plants are beginning
to call back some of the
450,000 to
500,000 workers laid off because
of steel shortages created

by the

strike.
Even though mills
steel at about 90%

are

re¬

of

anced their inventories and

mulated

enough

steel

terrupted operations.
vital

parts

is

car

and

,

unin¬

This lack of

restricting

tions in automotive

railroad

for

accu¬

opera¬

construction,

farm

shareholders

penalized them with

a

double tax,

first

on the company, and again on
the shareholder's ultimate receipt

This policy
principle that a
cash out-payment of a fund's real¬
ized capital gain constitutes a de¬
ceptive return of capital. The rest
distribution.

based

on

the

of the

industry paid out its mar¬
ket profits, and is continuing to
do so despite the recent change in
the Revenue Code permitting their
retention without involving dou¬
ble-taxation.

"Unwinding"—A
Closed-End

important

managements

to

to

pre¬

vent the

paying-out of their assets

in

dividends.

cash

Whereas

the

open-end funds constantly add to
their
assets
the
proceeds from

capital funds
resulting from the distribution of
their
run

market profits.
In the long
the proeess of divesting them¬

selves
the

of

market

gains

to recoup losses,
to the discomfiture (and material
disadvantage) of the managements
gradual

return
capital to the shareholders and
a

the
older

who

unable

are

the

of

because the sale

occurs

stockholder's

rights only
spread between the
price of the additional

the

offering
stock

and

the

market quotation,
protection to cover
the shrinkage of the latter below

giving him

no

the asset's value.
Your Alternative

The

cash-stock

Results

choice

UNDERWRITERS AND DISTRIBUTORS
OF INVESTMENT SECURITIES

good, barring

of
an

enterprise.

companies

his

only

slight dilution. If
he main¬

a

by taking cash.
If
your
stock is selling at a
premium, taking the dividend in
additional shares which are fig¬
ured at the lower asset value will

put
over

the

A

same as any
has advanced

price at which you ac¬

fundholder taking

premium

cash

will

leave

even,

you

lars

receives.

one

If

you

are

shareholder

through
asset

open-end fund
is no dilution

an

there

stock
figured at

dividend in either

a

cash

or

since

they

are

value

(only two funds are
charged a "load"'
commission)
for
acquiring the
known

to

have

additional
In

the

if

shares.

light

should

cash

is

a

as

be

not

foregoing',

the

of

procedure

to

closed-end

choose

required

tons

of

steel

in

the

21

million

first

forecast is 2.24 million
makers are said to be

cars

FREE

three

months, predicts the metalworking
weekly.
A major factor in the
auto¬

planning for

OF

WALES

SUMMERS

STATE

F^icrht

LTD.,
LTD.,

GEDULD

ADR
ADR

LTD., ADR

Sold

Quoted

Alfred L Men llroeck & Co.

production.

Dominick

&

Dominick

Members New York, American & Toronto
Stock
14 WALL STREET




Exchanges

NEW YORK

=====

Steel
climb.

production

continues

to

In the first two months of

1960, producers expect to clean
most

of

third

quarter

the

orders
of

placed

1959.

in

Steel

un

on

55

MEMBERS

Exchange

LIBERTY

American Stock Exchange

STREET,

NEW

YORK

5

the

mill

operations last week hit 92.5%

Continued

New York Stock

page

of

31

Tel.:

BE 3-8880

•

stock

for the

payment of the accompanying

For Banks, Brokers and Dealers

JOHN

chew up a record

since

premium is realizable on dol¬

no

holder

continue during

the

which

quired it.

appreciation,

will

ahead,

you

investment

capital funds

of

STEEL

will

strike.

.interest

earning power as a minimum,
and even gains to the extent that
other
shareholders are diluated

"

steel

a

capital gain dividend in cash

suffers

he chooses to take stock,
tains
his
proportionate

cashable

such distribution

Metalworking

the

In

closed-end fund selling at a dis¬
count
the stockholder acquiring

your

of

resumption

a

method

avoids this degree of abuse.

equipment

The outlook for the first auarter
is

of

This "as¬

industries.

throughout the United States and Canada

discount,

a

unwilling to subscribe.

of their assets in the form of still

presumably

of¬

closed-

serious dilution of their invest¬
ment is inflicted on those stock¬

possessing substantial proportions
unrealized

a

of

own

rights

buy

end fund which sells at

without

opportunity

constitutes

through
some

sale

their

and

Threat to

Management

particularly

the

to

a

off-sets

part, despite the fact that this

of

stock

ferings. When

sessment"

shipping "unwinding" of
capacity,1 And with the

metalworking plants will not be
run at
capacity until they've bal¬

consisted

holders

always

talization possess no such offset to

means

has

ers

additional

tained all of its capital gains, and
a few
others have withheld them

is

elaborate

The major anti-attrition instru¬

in

It

a

pool

stockholder

mentality used by the closed-end-

Electric Securities.

the

the

Building the Pool Via Assessment

the

to

year-end dis¬
tribution of their capital gains is

was

hurt

that

capital

we will not
this "hot" question.

on

the attrition of their

bot¬

not

feel

the

in

dends

of

of

,

this article

or

divi¬

reported.
Inventories

have
the

observers.

that the managers should "cut
the
cloth"
of their expenses "to
fit
the pattern" of their assets.
In

their day-in day-out sales of their
own shares to new
investors, the
closed-ends with their fixed capi¬

plants
are on

the latter
Utilities
Col
1956 has given the
investor
the choice of
buying its class A
shares paying dividends in
stock

Citizens

shrinkage

dividends in

cash;

the

"The Pattern and the Cloth"

or

both

na-

profits

Exceptionally in

Some /,

cash; (2) both

tive

fortuitous

market

of

severe

ities.

with

stock

in

stock

ing A into B.

capital
dividend

gain

mar

preserving capital is
for investment
com¬
panies than for industrials or util¬

more

income

cash,

bull

as

B in cash, with the
holder's
continuing privilege of exchang.

y
option:
(1) the invest¬

ment

the

or

w a

in

well

as

since

in

started

of

industry,

was

increase,
"Steel," the metalworking weekly,

metalworking
tomed out and

It

Correspondents inprincipal cities

giving the shareholder the choice
of taking his dividends in either
stock
or
cash
is
growing fast.

closed-end

worst of it.

during the first half of the year, weekly says that the auto indus¬
were
down
to
8
also
begun to
move
million tons, the lowest level since
up,
try will try to obtain nearly 30%
1946.
mainly reflecting this summer's
They are estimated at 8.5
of total steel shipments.
This will million tons now and are
long drought.
For example, the
expected
cost-of-living .index has recently be needed to sustain production to hit 10 million tons by Dec. 31.

1870

problem

predicts,
get the

will

have

©

ture

The investment company policy of

a

Steel

•

kets.

DEND IN STOCK OR CASH?

practices clause, the probability of
"mandated" settlement grows. If
this occurs, the magazine

in

industrial

pressures

of
on

Taft-Hartley injunction is not dis¬
sipating, particularly in view of

production, the "Review" notes, steel users in early 1960 depends
pushed employment to high on whether automakers can reach
countries

because

producers

confusion of the market.

has

levels

among

Meanwhile, uncertainty
steel

a

of the week follows:

of the corresponding 1958 period.

The

ahead

scheduling shipments.
Some are
clearing up third quarter orders
first; others are dropping the third
quarter entirely.

New

increasing
begin¬
ning to operate at close to full
capacity.
An important stimulus
number

plan

ings will be 9.4%

still

and the consumer-durables indus¬

to

differences

DIVI¬

Because- of

Tri-Continental has

finding it

are

is possible to obtain weekly clear¬

$27,653,210,908
against
$25,281,075,758 for the same week in 1958.
Our
comparative
summary
for
largely concentrated in the basic some of the
principal money cen¬
current

tough

consumers

future bear

COMPANY

YOUR

FINANCING:

scheduled.

are

Many

day, Dec. 5, clearings for all cities

in October.

The

tions

•

WILFRED MAY

A.

BY

INVESTMENT
"The

demand

Iron Age" says,

expect

•

In

took 23% of steel shipments.

observers

Thursday, December 10, 1959

.

.

.

of

Steel Production

Most

Chronicle

The Commercial and Financial

(2400)

Teletype NY 1 -4686

Private Wire System to Canada

tax

Volume

Number 5906

190

bll, or otherwise. If you are* an
o)eh-end holder, choose which-

three alternatives
convenient.

the

of

ter

vliich is the most

were

door-to-door,
but by stock exchange firms who
reaped an underwriter's harvest

with most of
vnat you write. I feel bound to
ftl you, however, that I greatly
explore your continuing attacks
IP on the contractual plan business.
/ You may quote all kinds of figabout the percentage of com-

nissions deductible the first year,

holdings

fund

income dividends to

nake

that fee, etc., but

up

you

to give the much-

you

pray

maligned contractual plan man a

respite

direct ypur editorial

and
at his

wrath

F.

Norman
Norman

F.

of

Distributors

M

u

tu

Dec.

4

"P.S."

Fund

1

vhich

vestor

sive

disturbs you.' They also

so

woided the pleasure and satisfac¬
and

a great extent stems
Competitive
Bidding
of flotation.
Striking

confirmation

of this conclusion is

adduced from this week's

French

of

In

bonds.

all such financing by
as you say,

What would you say to

who

concentrated his
payments,

'.fee not in the first years

.but in the very first monthly pay¬
ment? Feeling as strongly as you

do, I

am

sure

to join me in
His

name

that

you

^yill wish

exposing the rascal.

is Uncle Sam.

From the

first monthly payment on a
$100 per month contractual plan,
through his Internal Revenue De¬
partment he grabs $12 represent¬
ing the issue tax on $12,000 worth

very

of securities. It matters not to him

that

foreign bor¬

when the sponsor refunds the

or

en¬

There

are abuses
in all selling
and I suppose that the
Metropolitan area particularly has

Contractual

Plan

field.

Many of the companies sell
conservatively and properly; some
even
prohibiting their salesmen
from
accepting applications on the

—

A.

i

worst

mutual

fund

black

&

has

Sons

tion of Henry

with

below

1957,

J. Stone.

First

in

ten years came not from contrac¬
tual plans but from the wholesale

Monticello

opened
liam

liquidations of a glamorous fund
brought out last year by a famous

der

a

Corporation

the

has

branch office at 15 Wil¬
New York City un¬
management of Ronald

Street,

Rakow.

sales

engine

•

tion

a

'

.

Securities

become

associated

with

us

MANAGER, DIVISION OF FUND MANAGEMENT STOCKS

to

drive the tur¬

compressor

gas

mission

wallop— 10,500 H. P.
two-ton turbine. The ad¬

a

to

unit may

have had to be repaired
the job and made it necessary
maintain high-priced traveling

steadily

pressors

hop

for

ten

months

or

new

product

by

up

especially designed to
the pressure in tired gas

fields, where pressure is too weak

American Stock Exchange

to get




eight subsidiary companies,
including
Cooper - Bessemer
of
Canada

Ltd.

with

offices at

5, N. Y.

Cal¬

gary, Edmonton and Halifax. Em¬

ployees

numbering

3,900

joined

progress of this

and

busy enterprise.

1939, and the

the company exerted

when
order

of

magnitude

ability. This
to

1956

who

over

heat

and

cook

Bessemer for

management
team. In 1954 CBE earned $1.74 a

ment

that

with

natural

providing the equip¬
propels

this

useful

from the wellhead to their

vapor

share, $3.71 in 1955 and $4.10 in
homes.
Engines, compressors,
1956, (the best year).
Financial
position
of
CBE blowers,
pumps
and
generators
little

leaves

to

desired.

be

At

6/30/59 current assets stood at $33

which

millions,

of

millions

were

liabilities

in

cash.

this

at

ance

sheet

date
a

suggests

were

come,

sources

tives.

and

the

of

capital

heavy

characteristic

of

gas

and

serving

years

volumes

sales

excellent

some

to

Sixty

come.

lion dollars is a

company

last

January.)

Diesel

think

that

got

We

to

that

engines

is

CBE

with

a

at

of

a

FIRST

THE

a

a

year

below

its

on

research

high,

1959

most conservative

for

are

continued

a

sales and

Effective

net

advance

earnings in 1960.

office in
BANK

NATIONAL

BUILDING

32, FLORIDA

January 2, 1960:

Mr. George N. Shaw
Formerly
of

Director

of the

of Finance

the

will

United

join

States and

our

Canada.

organization

Mr. Shaw will be manager

tions and also
on

City of Miami and a

President of the Municipal Finance Officers Association

past

a

of

as

Vice President

our

Florida Opera¬
as a consultant

will be available

nation-wide basis.

began

WAINWRIGHT & RAMSEY Inc.
Consultants

on

70 Pine Street

•

the company

manufacture

pneumatic,. electrical

of

its

and

own

elec¬

sells

price/earn¬

the opening

announce

new

MIAMI

highly

ings ratio and the indications here

for

mil¬

pleased to

in¬

an

improve it. The stock is seven

points

likely sales target

are

run

order

an

locomotive

company

ing $2 million

market, and should look forward
to

(The

and

Cooper-

respected product line, and spend¬

gas

expanding

solidly

a

they

but

and railway locomo¬

sea

teresting

pipeline industries, CBE seems to
be

items,

addition

in

are

119

We

rapid growth
expenditures

the

dull

industries moving;

for

companies in related

product lines.
Because

our

ships at

for acquisition and merger

of attractive

seem

keep

Bessemer Diesel engines

only

sturdy bal¬
no need for

for some time
provides the re¬

and

may

there

Current

financing

public
to

$12.4

amount

Municipal Finance

the gas into pipelines. Also,

two years ago,

mar¬

should be grateful to Cooper-

gas

new

a

expanding

new

a

due importantly

was

of

entry

and

kets and tens of millions of people

par¬

profit¬

and

vital

serve

earn¬

Cooper-Bessemer is a line of com¬

Exchange

NEW YORK

in

$1

as

without overhaul.

Another

MEMBERS

BROADWAY

also

stock

ings were irregular and not
ticularly
impressive
until

pipe

pressors

more

120

cities in the U. S. and sales
agents
foreign countries. There af4

terrific

line operation in¬
clude
a
lower price, and
lower
cost
of
maintenance
since the
J-57 unit can be removed and sent
to Pratt & Whitney for repairs,
while another jet takes its place.
The traditional gas turbine com¬
on

low

industrial

run

New York Stock

E,

are

Grove

This power package

line.

half the size of the stand¬
turbine but packs

is only

signment the J-57 is expected to

LAIRD, BISSELL & MEEDS

S.

and another company have

Jets have been built, so their per¬
formance and reliability has been
well established. On its new as¬

»

Y.

of com¬ $8.6 millions. Such

repair crews and a large supply
of spare parts. Over 17,500 J-57

as

(N.

At
the

could scarcely be
tagged
priced at this juncture.

Clementsville, Kentucky
Columbia
Gulf
Trans¬

at

the

on

to
has

in par¬

station.
This is quite an innovation, and
the prototype unit is for installa¬
in

bring

Specialist'in Mutual.Fund Management Company

CBE

of

dividend.
1959 : net

in 15

trade,

facet

$1.60

a

indicated

manufacturing - plants of
at Mount Vernon, Ohio
City, Pa. There are,
addition, branch, offices in 20

in

(15%),
to the ma¬

chemicals, 4%

in¬

some

the

vantages which this new

MR. O. LYNN SilURTLEFF

to

been

The

and

to

are

also

dropping 24% symbol). That is the liquefaction around 5,200 shareholders take a
general of natural I gas. Continental Oil lively interest in the products and

has long been a

from

''.

bit

a

with

times

CBE

industry

gas

have

common

We neglected to mention another

it

had

sales are to the gas transmis¬
industry.
Cooper-Bessemer

sion

ard

PLEASED TO ANNOUNCE THAT

6%

the- company

of

and

beef*

postponement of in a venture—water transport of
Because its products are ittle
gas
pipeline construction caused liquefied natural gas to England known, and not highly advertised
by the Memphis case court de¬ and the Continent. CBE is to sup¬ consumer items such
as
Coca^cision, ordaining restrictive regu¬ ply the engines and compressors Cola,
Camels
or
Ivory
Soap,
lation of gas prices. Fortunately, for this operation.
people are not well acquainted
Cooper-Bessemer
has
not with
however, this rpuddled and illogi¬
Cooper-Bessemer and the
cal
ruling was reversed by the always been so progressive and fine
capital goods it turns out.
Supreme Court in December, 1958. so dynamic a company, The com¬
This
company
does,
however,
As a result, pipeline building has mon, adjusted for splits, sold as

a

WE ARE

idly by. It does

and 4% to railroads,
miscellaneous, and 23% in
parts, repairs and service.
'

U. Cobleigh

due to the
back-spin and,

to

aircraft

First Monticello Branch

11

12%

Cooper-Bessemer

rough,

38 l/z

over

sales

divi¬

has

of $4 million in
long debt
1,303,638 common shares, currently trading on N. Y. S. E. at

/

oil

about

CBE

and

is

the

1947

sists

well with its entrenched lines but

rine

.

1958

For

bine

given the
the past

eye

business

ma-

dus-

n

aeration; and

Cooper-Bessemer is

stand

know is

teresting stock dividends—50% in
1949, 10% in 1950 and 1951, 5% in
1952, 20% in 1956 and a 2-for-l
split in 1957. Capitalization con¬

run.

see

to

one

1959

Ira

pany

G.

first interview.
The

gas

and

There

are

steadily innovating, improving
and expanding its Wares.
After
pipelines, the principal

major supplier of
big gas turbines, and the compres¬
sors they drive to keep natural gas
nue under the direction of Francis
A. Lay.
moving hundreds of miles silently
and
swiftly
through
pipelines
from rig to
range. The demand
F, S. Emery Branch
of
pipeline operators for more
MANCHESTER, N. H.—F. S.. Em¬ power has led Cooper-Bessemer
ery & Company Inc. has opened
to join forces with Pratt & Whit¬
a
branch office in the Amoskeag
ney (Division of United Aircraft)
Bank Building under the direc¬
to
harness
the famous J-57 jet

fields,

the

Fla.

opened a
branch office at 853 Central Ave¬

simply changed his mind.

its share in

PETERSBURG,

Edwards

tire initial payment to an investor
who claims he misunderstood the

plan,

not

high-

rine

These

blowers for

new

to

Since

dividend payer, customarily de¬
livering about 40%
of
net
to
stockholders each year in cash.

engines to pro¬
liquid oxygen that makes

So you

Currently around 36%

New Edwards Branch
ST.

wants

a

and

missiles

our

its energies to

road

systems.

also

are

compressors

devotes

making
"quality

of

compressors.

duce the

Cooper-

which

the investor may

make only
one,
seven, or seventeen of
the
contemplated 120 payments, and
he won't refund a dime of it, even

he

production

soot and for sewage

(excepting Canada), this
$50
million
issue provides the
buyers with a 10-year protection
against Calling at any premium- resumed enthusiastically and busi¬
price. Yielding 5.89% to its 1979 ness at Cooper-Bessemer has since
maturity and 6% on its average taken on a far brighter hue. At
life, any offsetting charge for the June 30, 1959 unfilled orders had
Call protection would seem to be boomed to $31 million, up 51%
from the same date in 1958. For
nominal.
the first six months of this year,
Of course, we do not maintain
net per share rose to $1.74, against
that in negotiated financing the
$1.17 for the corresponding period
underwriter has dictatorial power.
in
1958.
And the pick-up
con¬
But there surely is more flexibil¬
tinues. Net sales are expected to
ity where a contract is jointly
rise
above
$60 million and per
arranged, than where a wrappedshare
net
to
around, $3.50, for
up package is mechanically auc¬
1959% Which is the sort of cor¬
tioned
off to
get the highest
porate improvement that attracts
bidder.
investors and influences markets.

have far to look to find the worst

sponsor

offering
with

line

rowers

is

offender.

of in¬

protection against the abu¬
provision in most bond

method

and

for

news

the

compressors

There

tries.

Call

Naturally when any investor
a stock, one of the
things

.

virtually automatic in, their opera¬
tional control of pipeline engines

very

industrial

the Federal Gov¬
readying a crackdown
upon the practice of collecting ten
years' fees in advance, it will not
If,

is

ticular,

The Worst Offender

ernment

This

in

control

tronic

"Business

in

substantial rise

$37.4 billions).

column of last week we

the

a

and

pumps

in American capital goods expen¬
ditures for 1960 (estimated total,

from

which

security

projection

contracts, to

might
lave been their's if they had had
be discipline of a contractual plan.
tion

A FINANCING

ON

our

turbines,

for the
oil, gas, heavy
chemical, rail¬

-V,'

contended that the absence

avoided that dread¬
prepayment of commissions

Jhese people

ful

f

ABUSE
In

recent

excelling

company

and diesel en¬

•

such incredible percentage
of the voluntary plans es¬

70%

A

Week" indicates

a

gines
$

-is.

tablished have gone off the books.

a

a

7, 1959

majority of contractual plan
ovners end up with d sum which

on

poration

Bridgeport, Conn.

tie

notes

Bessemer Cor-

Dacey

Associates,

&

Dacey

field

engines,

The

Financial Consultants & Trustees,

^presents a profit to them, where-

Corp.

dends.

good

betters.

Cordially yours,

cinnot get away from the fact that

25 some

this year, and we would estimate
above $65 million for 1960.

By Dr. Ira U. Cobleigli, Enterprise Economist
Some

of

and
in as

number of years it will take'

tie

,f>r ordinary

as

out

shareholders

the

mutual

5

looks at

brazenly

disgraceful an example of churn¬
ing asT"ever took place.
I

May:

The Cooper-Bessemer

plans literally

back into individual stocks,

I enjoy and agree

ires

tual

their

MAN

leader Dacey Urges Exposure of
i
The "Real Rascals"
jear Mr.

which

selling

CONTRACTUAL
PLAN

banking firm, shares
promoted not by
the little fellows selling contrac¬

(2401)

investment
of

and who have since been

IN DEFENSE OF THE

-

The Commercial and Financial Chronicle

...

New York 5, N. Y.

in

6

(2402)

The Commercial and Financial Chronicle

TAX-EXEMPT BOND MARKET

tend, to

alert

dealers

of

An

ex cent ion

to

bidding is

sup

municipal bond this currently satisfactory rate
of distribution, and because

of

new

such

&

Company
a

Trust Company; Drexel
yield of Group. The bonds were
group.

Yorl;

& Co,

scaled
in 1977-1979.
A ^ood investor reception
wss

4.05% in 1978-1980. The baL to yield 3.70%

is-

the Hnce in sccount Wcis reported

coursG

exceptionafly 'large

Devine

keen'^be bonds reached

this

spirit of competitive
market has been easier
during
the past week but not in a

pany; First Boston Corpora- gan & Co.; C. J.
Devine k
tion; Lehman Brothers; C. J. Co.; Chemical Bank New

close to chronic
over-competitiveness.

BY DONALD D. MACKEY

The State and

this

Thursday, December 10, 1959

...

flotation about $13,000,000 on Wednes- indicated,

is offered by

morning. Gradual lmLar„er jssues roniin<> t,,
provement in sales seems
Market
likely if past performances
Th
.
v
are a criterion.
;
•
The new: issue calendar m
-The $10,000,000 Chicago, eludes a few large and inter
Illinois Board of Education esting issues for the
coming
cases
with better disr serial bonds were awarded on
ago, in terms of yield, for
the present. There has
weeks.
The Houston,
Texas
tribution generally
is 3.565%
resulting.
today, the dol- been good spacingof large
Wednesday to the Glore, ForContinued on
page 45
equivalent would repre- sales by the
issuing authori¬
the

issue

new

calendar,

as

al-

the State day

of California
reactionary sense of the word, though heavy in spots, is
periodically and
genA1 though the Commercial and
many large public issuers. Alerally moderate in volume
Financial Chronicle's
high and numbers of issues for this though offered for'competitive bidding, for the most
grade State and Municipal time
part
of
year,
the
market
one
Bond Index was
bid
usually ensues in
3.515% a seems likely to continue steady
week
these
and

lar

sed less than

decline.

a

This

rived from

one-half

point ties, and there have been disis de- creet cancellations and de¬

average

outstanding, rela- ferments

of

sales,

when

lively active issues, and does cluttered market situation
not
directly reflect the new seemed imminent. This
issue
offerings which daily cleared the market of
reach

the market.

alluded to the firmness of the
new issue
market, while not-

ing that the secondary

always

a

of

mar-

in' the

following tabulations we list the bond issues of
$1,000,000 or more for which specific sale dates have been set,

sched-

were

('

postponed
for

reason

with

Information, where
rowey

no

[na

to
•

of

one

C

financing accomplished

-

the

bonds

are

cause

many

O-

in

..

supply, and beof

its

follow the new issue List" total of state and municsubdivisions have
suDcuvisions
nave
recently
recently
For the past few weeks
ipal offerings stood at only sold sizable
-issues, parts
ot
municipal bond price Indexes $219,660,466 on Nov. 9 last,
which
remain
unplaced, it
generally have been slightly Since then it has been inwould appear that the State
lower, while new issue bid- creased about
$100,000,000

for

the

most

has the

part

to

current level of

$326,550,been
strong and consistently 697. Although the increase is
competitive.
; relatively
important and further increase must be
viewed
as
0f
signal

_

Investors

Receptive

importance

Recent

been,

on

cessful.

to

underwritings have underwriters and traders, the
the whole, fairly sue- present float is
not a serious
One in five or
six, deterrent tb our

17,395,000

Central School Dist. No. 1, N. Y.

1,500,000
1,500,000

wisconsin

university
corporation, Wis._-

1964-1966

1:00 p.m.

,

1960-1988

2:00 p.m.

1962-1978

7:30 p.m.

1960-1997

10:00a.m.

>^5,270,000

December ll

December
.

/

v

1962-1999

2,000,000

14

•

-

1,530,000

Development Comm., Fla.

Board oi' Trustees Of State

(Friday)

3

0f Regents State Teachers'...
Colleges, Texas

future date.

7:45 p.m.

Building

Boal.d

Florida

1961-1980

..

.

N. Y.______
Oxangetown and Clarkstown

T"1or Ino^penHpnt Sch. Di4.. Tex.

may be seeking a more favorable market situation at some
near

1,500,000

Retirement System,

important

lead.

ding

,

New York State Employees'

C

.

,

Deccmbe* 10 (Thursday)

..

Abington Township, Pa.__—

biddine"

ri

/

.

ta

_

7heavy volume .group heads. Since California
J

available, includes name of borof issue, maturity scale, and hour at which

amount

^ids wiU he opened.

the

postponement
immediately .available, accord-

earlier in the yeay, the "Blue

sarily

California

? has been indel-

e

\ 7

.

mitely

*

or neces-

of

qJ^TIV^ Sa?e

un-

Inventory Swollen
With all the

State

bonds (1961-1985)

has

have

we

Larger Issues Scheduled For Sale
000,000

has

wieldv pressure.

*»-

In recent columns

ket does not

n

_

•

1961-1972

9:00
11:00

a.m.

a.m.

(Monday)

■

•

■

-

Recent Awards

.,

Colleges, R. I._
____' •
1,100,000
,ni
Garland Ind. School District, Texas
"1,500,000
ihe $21,601,000
Common.Houston'Indep. Sch. Dist., Texas__ 16,934,000
wealth of Massachusetts issue Port of
Portland, Ore._________"__
2,000,000
awarded Dec. 3 to the Chase Ftah University, Utah__________3,160,000

%

1961-1998

^

■

Noon

1960-1994

7:30 p.ni

1961-1989
1960-1979

2:00 p.m."
10:00 a.m.

1962-1999

10:30

1960-1989

Noon

highly corn- Manhattan
been close to a
Bank; Halsey, Stu: 1 December 15 (Tuesday)
sell-out, petitive new issue
bidding, art &
Comnanv
whereas the rest seem about
Salomon Andrews Indep. Sch. Dist., Texas;. 2,989,000
1961-1975
However, the dangerously thin Brothers
Brotheis & Hhitzler
half sold or even better.
Hutzlei Crnnn is Arapahoe County S. D. No. 6, Colo. / 1,750,000
1965-1968
At markets which are
Gioup is
occasional.

a.m.

has

.

close to two-thirds sold.

MARKET ON REPRESENTATIVE
Rate

California

(State)™.

__________

Pennsylvania (State).._____
Vermont (State)
New
Housing Auth, (N. Y., N. Y.)
Los Angeles. Calif
Baltimore, Md
Cincinnati, Ohio

__

.■New Orleans. La.

Chicago, 111.

__________

_______

New York
City, N; Y

December 9, 1959
DOLLAR

BOND

QUOTES

fas a

PUD

4.00%

3.80%

3.55%

3.40%

3%

1978-1980

3.70%

3.50%

3%

1978-1979

3%%
3%%

1974-1975
1978-1979

3.30%.

3%%
3%%

1977-1980

3.40%,

3.25%

1980

1-1-1978

Chicago Reg. Port

,■>%% 4-1-1995

Co., Wash. PUD No.
37/8% 11-1-2005,.,
Illinois Toll Highway
5%% 1-1-1995.,

offered

4.00%

3.80%

was

an

4.25%

4.10%

INFORMATION

100

109%

103

-/2

4 27%

84V?
/z

1%
4

4 08°'0
4,08

951/2
/2

-W

103%

72%
/4

_1/,

10434

90

_i/„

^2% 1-1-1994...

1-1-1962

103

7-1-1967

103

.

4%% 7-1-1992
Kansas

.

Turnpike Authority

33s%

10-1-1994..

Kentucky Turnpike Authority
3.40?;

7-1-1994

K'eckinac Bridge
Authority
4% 1-1-1994
Vame Turnpike

10-1-1962

103

7-1-1960

104

1-1-1964

108

1-1-1958

104

Authority

4% 1-1-1989
Massachusetts Turnpike

3.30% 5-1-1994,...
Massachusetts Port

^

10434

1 031A

104

—2^

^r^S•AuthoiitV,•••••,

7"M958

1031/2

Ke'TYorkVUer Authority

M"1963

103

Y^k Vhrlway' Authority
Chjo nirnp.l'n1 A9?thoVity

^-WO

103

v'%% 6-1-1992
-ennsvi'/ania Turnpike
3.10% 6-1-1993

Richmond-Petersburg
3.4q%

7-1-1995

Turnpike

Virginia Toll Revenue
3% 9-1-1994

i




ioio

'1-1959

Q 1 iqcq
9
1-1959

1031%
v<

&

oi

Co

o

and

N. Y

1,449,000
1,500,000

:

Falls, N. Y.___

4.13%

-11%

3.98%

~214

4.12%

82/2

-1

4.04%

791%

_2

on/

4.62%

.

_

,

.

Tuesday. Dee.

-The

a?''

d

„

1:30p.m.

3:00 p.m.

1960-1974

11:00 a.m.

8'S00,000

1961-1980

Noon

/

'

1963-1990

_

1,652.500

1960-1980

3,110.000

North Robinson Local S. D., Ohio

1961-1983

Oneida County, N.

1,475,000

1960-1973

2:00 p.nt

1,210,000

1961-1980

11:00 a.m.

1961-1984

Nodn

Barney

good investor

District, Ohio
Perry Local School

&

Ingen & Co.,

re-

District, Ohio

December 21

Sandusky, Ohio

!_•_

1,755,000

1961-1984

1,650,000

1961-1980

2,000,000

1960-1984

Ventura Union

High S. D„ Calif...
December

-

Easlw°od Number

23

4,900,000

"
1961-1975

Two Local S. D.

I'mZ ^O-'S S-

'
January 1 (Friday)
.

.

Commonwealth oi San Jose,
$20,000,the

First

8414

National City
Bank; Chemical

—1%

3.82%

Bank

JNew

York Trust Com-

Calif

4,435,000

January 11 (Monday)

Spring Branch

Columbus

„

1961-1980

11:00 a.m.

1961-1980

9:00 a.m.

1961-1980

11:00 a.m.

January 6 (Wednesday)

Puerto Rico awarded

3.88%

11:00 a.m.

(Wednesday)

w°rth.

,,34

2:00 p.m.

,

^balance of only Timst'eesofYndfana "UnI%"Indt:::
'

821%

3:00 p.m.
Noon

(Monday)

December 22 (Tuesday)

,,

is
reported
time. The investment

bonds to

7:00 p.nt

Southbridge. Mass.

$2,00Q.000

serial

/>2:00p.m
2:00 p.m.

1.250,000

Chic0pec' Mass
3,000,000
ily improved and seems closer
January 5 (Tuesday)
to
being recognized at its real Santa Monica Unified S. D„ Calif.
2,500,000

000

4:00 p.m.

.

status of this credit
has stead-

The

Noon

1960-1979

of-

maturities. The issue met
with

at press

1960-1989

groups.

Alex Brown & Co:
syndicate.
The
bonds were scaled
to
yield
4.20',/
for
1994-1998

a

2:00 p.m.
10:00a.m.

1,925,000

Middlesex
County, New
"
December 18 (Friday)
Jersev
Sewerage
Author it v -Adams Towns'-in. Loral S. D.;,Ohio
2,600,000
awardpR
^7
70^nnn
eoriol
Rowland Township Local School
awarded
$7,705,000 serial
Smith

Noon

"1960-1967

1,050,000

_

Miami-Trace Local Sch.
Dist., Ohio

8, two im-

portant new issues were
fered by large dealer

a.m.

December 17 (Thursday)

manv

Midland. Texas

On

.

3,450.000

Robbinsdale Indep. School District
No
28l, Minn,__.

o

manY

''

ntWc
oiriers...

immediately

1f._

105

sev-Tegeler

ception and

mxN

IQ4

13,

sup-

Blyth & Co.,
Ingen & Co.; Demp- '

4.35*

_34

84/2

7 1

writers included
B, J Van

4.58%

101%

oi.

m?i/

<; ifi*
5.16%

4.09%

831%

101,1

a sdo,
4.85*

-1%

1031/2

7 1-1963

ion*
j.yu*

.831/^

iru

7 1

5 04«>/

^5.04/o
'

3.75%

6-1-tQ^o

'

f'-Dam Pi
oject, Calif.
3.05?o 7-1-2004

w
5.36%

-1V4

7"1*1960

ton

>-*«
,

1,967,000 .1960-1975
11,500,000, 1962-1990
1,250,000
1961-1979

Marina Piqua, Ohio___i________
'
revenues, and a premium bid Pittsfield, Mass.
quickly developed. The under- h ichm on d, Va,,
2 ~r - - t - - - - r:'

about
93^

Authority'"
6-1-1959

0

c

QI

-

issue,

by

bonds to the b irst
Boston Cor-

_3t„
4

103

No.

u

yielding

entirely

poration;

7^/2

10'H969

Authority

lit L i
htyh

8:00p.m.
;

Luntington Union Free,Sch. Dist.',

for

3 ogo

-U4
'4

Authority

Kew^Jersey"turnpike

excellent demand

1961-1988

a.m.

(Wednesday)

County, N. J
Dekalb County, County S. D., Ga.
Gary, Ind.

There

4 34%
*

-34

821?

10112.

December 1G

Bergen

12/1/99,

—1/2
'2

901%
86

due

at

.

Ray

_i

72%

2

5-1-1962

5 5S

/4

85

Authority

e»«

/2

.

Jacksonville, Fla. Exp.

4 11°'

4.11*

'2.

1-1-1978

Highway

4 47%.

ty?

1-1-1965

Toll

s

.

4540,0

-1%:

95

103%

Yield to

Maturity

_34
4

105%

Del

District) 0hio„-

Reaciingi Mass.

Angeles County,

5.60s,

this

r.lajn Lo(,a1 School

the $13,-

________________

<%% .1-1-1998
India-.a Toll
Hiqhway

lilino

11:00

was

Marina

-

Revenue

Net Changes

104%

5-1-1966

1961-1979

Los

and

from Prev. Week

103%

2

1,100,000

000.000

Lalilornia

3.75%

Price

7-1-1962
4-1-1962

...

Grant

Noon

approximate)

1-1-1974

Authority

1961-1980

3.40%

Offering

9:00 a.m.

2,550.000

This

3.55%

Call

8:00 p.m.

1961-1980

same

3.90%

Price

8:00p.m.
Noon

to maiket.

..On the

ported

RELATED

1961-1982

3.10%/

3.565

==

_!_•

3.15%,
3.80%,

3%

1960-1979

D., Ohio

11:00 a.m.

3.65%

■

n re sent hi oh vields
afford
present
high yields alloi
d

broader distribution.

J

Local S.

1963-1975

4.00%,

1979

La Salle County, Ottawa Township
Hish School District No, 140, 111.
1,800,000
Log Angeles county,
Calif.___„„2,444,000

Fairfield

10:00

3.80%

1980

1961-1975

N.

to

investors of all types

2:30 p.m.

1961-1998

3.60%r

3.25%,

2,300,000
1,170,000
1,493,000

Mississippi Southern College, Miss.
1,465,000
day an inter- New Jersey (State of)—
66,800,000
estincr mH nniKiifll'iccno nnmo Paw Paw School
District, Mich
L 1.600,000
esting and unusual issue came

1978-1980

1977

Index

3.75%

and
anct
a

1980

3V4%
3V2%
3V4%
3%%

No. 1

Chicago-O'Ha e Airport
<%% 1-1-1999...,
4% 7-1-1995
Fioriiia Turnpike

whole)

attract

Asked

.

1978-1980

are

First Callable Date

Issue~

Chelan Co., Wash.
5% 7-1-2013

Bid

1980-1982

—

AND

(Prices and yields

Maturity

Ihis

high grade credit continues

ISSUES

3%%
3-%%

______

Connecticut (State)
,New Jersey Highway
Auth., Gtd.__
New York
(State)

SERIAL

Augusta> Ga.

Ind. Sch,

Eist., Tex.

2,892.000

■

1961-1990

8:00 p.m.

January 12 (Tuesday)
City School

Dist., Ohio

8,000,000

1961-1983

Noon

Volume

190

Number 5906

.

.

.

The Commercial and Financial

This is

not an

Chronicle

(2403)

offering of these Shares for sale,
The

or a

solicitation of

an

offer to buy,

any

of such Shares.

offering is made only by the Prospectus.

.

.
....

.

•

J

2,000,000 Shares

■i:

Price $82 per

These Shares

are

share

being sold to the Underwriters by The Ford Foundation and no

proceeds will be received by Ford Motor Company. Copies of the Prospectus
•

from
to

any

act

as

may

of the several underwriters only in states in Which such underwriters
dealers in securities and in

which the

Prospectus

may

Blytli A Co., Inc.

part

of the

be obtained

are

qualified

legally be distributed.

;

The First Boston

V';

Corporation
Goldman, Sachs A Co.
Kuhn, Loeb A Co.
Lehman Brothers

Merrill

Lynch, Pierce, Fenner & Smith

4

Incorporated

:

White, Weld A Co.

>

Eastman Dillon, Union

Securities & Co.

Glore, Forgan A Co.

-

Smith, Barney & Co.

Incorporated

Stone & Webster Securities Corporation

Dean Witter & Co.

Carl M. Loeb, Rhoades & Co.

F. S. Moseley & Co.

Hornblower & Weeks
Bache & Co.

Harriman Ripley A Co.

Dominick & Dominick

Clark, Dodge & Co.

Salomon Bros. & Hutzler

First of

Dick A Merle-Smith

10, 1959.




Lee Iligginson Corporation

Allen & Company

Goodbodv ACo.
Tucker, Anthony A R. L. Day
Estabrook A Co.

Drexel & Co.

Hemphill, Noyes & Co.

Hallgarten & Co.
A. G. Becker & Co.

Wertheim & Co.

W. E. Ilutton & Co.
llayden, Stone & Co.

Incorporated

Ladenburg, Thalmann & Co.

G. II. Walker & Co.

Michigan Corporation

Spencer Trask A Co.

December

,

hazard Freres A Co.

Paine, Webber, Jackson & Curtis

Francis I. duPont & Co.

Incorporated

E. F. Hutton & Company

Kidder, Peabody & Co.
!>,

Bear, Stearns & Co.

American Securities Corporation

A. C. Allyn and Company

Reynolds & Co., Inc.

'

'

Baker, Weeks & Co.

W. C. Langlev A Co.
Walston A Co., Inc.
Model, Roland A Stone

R. W. Pressprich A Co.
Alex. Brown A Sons

Equitable Securities Corporation

Shearson, llanimill A Co.
Watling, Lerchen A Co.
Schwabacher A Co.

L. F. Rothschild A Co.

Shields A Company
Wood, Struthers A Co.
F. S. Smithers A Co.

7

3

The Commercial and

(2404)

DEALER-BROKER

Raytheon

Ilarsco

INVESTMENT LITERATURE

Wall

UNDERSTOOD THAT THE FIRMS MENTIONED WILL BE PLEASED

are

THE FOLLOWING LITERATURE:

Freight Industry—Report—Alkow

New York 4,

Burnham View

N. Y.

Monthly Investment Letter — Burnham and
Company, 15 Broad Street, New York 5, N. Y.
Also avail¬

able

in

—

current Foreign

Equities

Letter.

Investment—List

for

which

industries

appear

Klein

&

Noyes

Co.,

Broad

15

Miles

National

brief

Japan

for

survey

of the Steel Industry.

and

1959

—

Yamaichi Securities

Stocks—Analysis—In December letter—Good-

available

is

report

a

on

United

com¬

Jones

Averages and the 35 over-the-counter industrial stocks
used in the National Quotation Bureau Averages, both as to
yield and market performance over a 20 - year period—
National Quotation Bureau, Inc., 46 Front Street, New York

&

&

&

Stocks—Comparative

figures—G.

A.

Industry—Survey—E.
York

Also

6, N. Y.

Capital

Equipment,

Selected

Railroads.

F.

Hutton

&

Oxygen
♦

Cyanamid

Co.,

*

Producers,

61

Oil

Corp,—Report—Hornblower

Chemical

&

Feb.

Hentz

Borax:

Chemical

&

Corp.,

and

portfolio

a

Refractories

H.

Lewis

&

Co.,

63

Co.—Memorandum—Green, Ellis & An¬

Wooltlridge

the

April

(April 8, 1960

&

Transmission

Gas

letter

same

sociation
the

ness

Real

Estate

bond

and

stock

averages.

Company—Analysis—Laird, Bissell & Meeds,

120 Broadway, New York
5, N. Y. Also available is
ysis of Atlantic Coast Line Company.

an

anal¬

H.

annual dinner in

Ballroom

are

a

&

Co.,

123

1960

Association

the

Hotel

at

ernors

Atlanta

The Mil¬

—

Philadelphia

E. H.

Building,

is

Association
Firms
ernors

of

Stock

busi-

Island, N. Y.

27-Dec.

Beach,

(Hollywood

1960

2,

Fla.)

b

Convention

With American Sees.
Hess,
9, Pa.

(Special to The Financial Chronicle) s

BOSTON, Mass.—Andrew J, Mrhoney has become associated With

Ernest

H.

Snyder is conducting

with

1nr7

0,

AT

,r

Corporation.
formerly

Securities

53. State Street.

Snyder Opens

He

was

Halsey, Stuart & Co. Inc.

a

With

Reynolds & Co.

.

(Special to The Financial Chronicle)

(Special to The Financial Ciu'cnicie)

Ollie

B.

PORTLAND,
Michener

Oreg.

and

—

Kenneth

Harold
A.

E.

of

Daugherty, Butchart & Cole, Inc.,

Marietta

added

to

the

nolds

&

Co.,
He

—

Edwin S.

affiliated with Rey¬

now

South Church
previously with

221

was

Bache & Co.

Smith

have

been

Outen is

Street.

Elton have been added to the staff

59

Holly¬

at

Hotel.

Beach

wood

(Special to The Financial Chronicle)

Goodbody & Co.,
Street, Northwest.

y

Investment Bankers Association
Annual

Wiliam St., New York City.

ATLANTA, Ga.—Thomas J. Asher,
and

Exchange

meeting of Board of Gov¬
at Fisher's Island Club,

Fisher's
Nov.

securities business from offices at

Evans.

Brady

Bill-

more.

With Daugherty Butchart

W.

staff

of

Marache

With Granbery,

Chronicle).

(Special to The Financial

729 Southwest Alder St.

BOSTON, Mass.—Gilbert J.

Firm

EXTRAORDINARY

(a) Operating Utilities

Terry M. Kirsch is
52 Wall

Commercial and Financial Chronicle's

the firm

From 1895 to 1939 Inclusive

Approximately 130 Volumes

HAuover 2-2400




York 6, N. Y.

Teletype NY 1-376; 377; 378

of T. M.

name

under

Kirsch &

in All

SYNDICATE FORMING
5th

AVE.

10%

Troster, Singer & Co.

St.-, New York City

Co.

FOR SALE

& Distribution

Members New York
Security Dealers Association

engaging' 'in a
offices at

securities business from

2 Sets of

(b) Natural Gas Companies
Transmission, Production

Higginson Corporation.

T. M. Kirsch in N. Y. City

OFFER

Trinity Place, New

Boy-

ley has become associated with
Granbery, Marache & Co.. 45 Milk
Street. He was formerly with Lee

Trading Markets in-

74

,

Sept. 12-13, 1960 (New York City)

Report

—

South Broad Street,

investment

Leslie

Ga.)

Stock

list of tax -target stocks for anticipated

Corporation
Milam

(Atlanta.

of

Exchange
Firms meeting of Board of Gov¬

Goodbody Adds Three
Charles

of .a the

Biltmore.

CHARLOTTE, N. C.

Corp., Arthur G. McRee & Co., Houston Corporation, and the
Grolier Society. Also available is the current tabulation of
Falstaff Brewing

of

34th

9-10,

May

on
proposed merger with
Co., 135 South La Salle Street,

Company

SAN ANTONIO, Texas—H. Leslie

continuing

-

(New York City)

Grand

American

Inc.

Tex,)
Investment

New York Security Dealers As¬

way,

Evans,

(Dallas,

of

Sheraton Dallas.

of

Paper—Memorandum

Co.—William Blair

Now

1960

Group

Bankers Association of America
25th
annual
meeting
at
the

New York 6, N. Y.

Moyer

6-7-8,

Hotel

Armstrong Rubber—Report—Thomson

& McKinnon, 2 Broad¬
New York 4, N. Y.
Barnes Engineering Co.—Analysis—Pur cell & Co., 50 Broad¬
way, New York 4, N. Y.
BecKman Instruments, Inc.—Report—Schweickart
& Co., 29
Broadway, New York 6, N. Y.
Brooklyn Union Gas Co.—Analysis in current "ABC Investment
Letter"—Amott, Baker & Co., Inc., 150 Broadway, New York
38, N. Y.
In the same issue are data on Marine Midland

(Detroit, Mich.)

Club

Texas

Co.

recovery and high yield stocks.
Westinghouse Electric Corp.—Memorandum—Woodcock,

Corp.

of Gov¬

of Detroit
annual
winter party at Sheraton Cadi!lac Hotel.
m

Company, 207 East Michigan St., Milwaukee 2, Wis.
Tex Tube, Inc.—Report—Moroney, Beissner &
Co., Bank of the
Southwest Building, Houston 2, Texas.
Union Gas Company of Canada, Ltd. — Analysis —- Doherty
Roadhouse
Co., 335 Bay Street, Toronto, Canada.
Universal Oil Products Company—Study—Forges, Singer &
Co., 15 Broad Street, Now York 5, N. Y.
b
Wallace & Tiernan—Analysis in December Investment "Letter
—Carreau & Co., 115 Broadway, Ne\v York 6, N. Y. Also in

and

; >

Exchange

at Sheraton Dallas Hotel,

3, 1960

Bond

waukee

Neu & Co., 120
Broadway, New York 5, N. Y. Also in the same circular are
data on Continental Oil Co., Food Machinery & Chemical
Corp., National Tea Company, Quemont Mining Corp. and
Ramo

at

Manufacturing

Tennessee

Broadway, New York 6, N. Y.
Company —Data — Oppenheimer,

Thompson

"New

(Dallas. Tex.)
of Stock

meeting of Board

ernors

Also available

Company.
Corp.—Memorandum—H.

Chicago 3, 111.

Broadway,
data on

61

Anaconda

Ohio

Co.—-Memorandum—Moore, Leonard
Lynch, Union Trust Building, Pittsburgh 19, Pa.
Corporation—Review—Ira Haupt & Co., Ill Broad¬

KVP

*

Airlines, Inc.—Review—John
Wall Street, New York 5, N. Y.

derson,

States

Sutherland

in the same circular are

American

American

of

Firms

Manufacturing Co., Montgomery Ward & Co., Inc.,

Rubber

way,

Co., Inc., 52 Wall Street, New York 5, N. Y.
Bonds—Circular—Vilas & Hickey,

Broadway, New York 4, N. Y.

New

of

Dinner

(Baltimore, Md.)
Security Traders AsMid-Win.

Association

Schering

Railroad Fixed & Contingent

Steel

Chemical

&

selling under 30.

Rockwell

N. Y,

Common

Annual

Dinner.

ter

Revlon, Inc.—Analysis--Hayden, Stone & Co., 25 Broad Street,
-New York 5, N. Y. Also available are an analysis on Amer¬
ican Distilling Company and a bulletin on Mansfield Tire

parison between the listed industrial stocks used in the Dow-

26

Starch

stocks

Over-the-Counter Index—Folder showing an up-to-date

Saxton

analysis

& Decker

General

Instrument.

Utility

15, 1960

Feb. 1-2, 1960

Co., 72 Wall Street, New York 5, N. Y. Also available is
a
review of the Electric Utility Industry.
Parke, Davis & Co.—Memorandum—J. A. Hogle & Co., 40 Wall
Street, New York 5, N. Y.
Philip Morris, Inc.—Report—Harris, Upham & Co., 120 Broad¬
way, New York 5, N. Y. Also available are reports on Black

York.

Also

City)

Association

Ninth

Baltimore

&

body & Co., 2 Broadway, New York 4, N. Y.
In the same
issue are lists of securities in different categories which

Public

Distilleries

National

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

attractive.

(New York

Starlight Roof, Waldorf-Astoria.

Jan.

Inc.—Analysis—Hill Richards & Co., 621
Spring Street, Los Angeles 14, Calif.
*
Morningstar-Paisley—Analysis—Boenning & Co'., 1529 Walnut
Street, Philadelphia 2, Pa.

an

New York Bank

y

Laboratories,

Weeks, 40 Wall Street, New York 5, N. Y.

a

York

States Rubber.

is

and

Hotel.

15, 1959

Investment

&

in

Elizabeth
Dec.

York 6, N. Y.

United

and

(Montreal. Canada)
Associa-

Bond Traders

tion 32nd Annual Dinner
at the
Grand
Salon
of
the
Queen

South

Japanese Stocks—Current Information

4.

New

analyses of
Heavy Industries, Nippon Flour Mills Co., Iwaki

Cement Co.

appear

Broadway,

11, 1959

Montreal

Wiesenberger & Co.,

review of the outlook for Plant and Equipment

a

Expenditures

Dec.

sociation 25th annual

Japanese Stock Market—Study of changes in postwar years—
In current issue of "Nomura's Investors Beacon"—Nomura
Securities Co., Ltd., 61 Broadway, New York 6, N. Y.
Also

New

Co. and American Marc.

Collins Radio

Department

Corporation

Street, New York 5, N. Y.

Mitsubishi

on

Aircraft—Review—Montgomery, Scott tSc Co., 120
Broadway, New York 5, N. Y.
Lone Star Cement—Analysis—Reynolds & Co., 120 Broadway,
New York 5, N. Y.
Also available are analyses of Carrier

•

available is

data

Utilities—Analysis—A. G. Becker & Co., Inc.,
Broadway, New York 4, N. Y.

61

various

in

stocks

common

Industry—Review—Hemphill,

IN INVESTMENT
FIELD

Lockheed

attractive—Oude, Winmill & Co.f
1 Wall Street, New York 5, N. Y.
Also available is an anal¬
ysis ol Commercial Solvents Corporation.
7>
Glass

EVENTS

Stocks.

Lazard Fund, Inc.—Memorandum—Arthur

-

of

COMING

,

Stores—Analysis—Blair & Co. Inc., 20
Broad Street, New York 5, N. Y.
Landa Oil Company—Analysis—Central
Securities Co., 5733
North Central Expressway, Dallas 6, Texas.

50 Broad¬

& Co., Inc.,

•

Hammill & Co., .14
Street, New York"5, N. Y. Also available is a report on

Southern

60
S.

way,

Company.

Broadway, New York 38, N. Y.
Intercliemical Corp.—Analysis—A. M. Kidder & Co., Inc., 1
Wall Street, New York 5, N. Y. Also in the same circular
Iowa

Air

Thursday, December 10, 1959

Imperial Packing Corp.—Report—R. G. Worth & Co., Inc., 160

AND RECOMMENDATIONS
INTERESTED PARTIES

.

Corporation—Renort—Shearson,

Insurance

TO SEND

.

Street, New York 5, N. Y.
on

IT IS

.

Instrument—Report—Hill, Darlington & Co., 40 Wall
Also available is a memorandum

General

'

Financial Chronicle

Another Set

1908-1928 Inclusive

up.

BLDG.

return

Limited

60

to

New

York

residents. Call Financial

WHICH SET INTERESTS YOU?

Greenwald

leasehold.

Yr.

units of $1,600

on

&

State

Mgr. Wm.

CO 5-7655, 9

to 5

daily

Or

write

i

Write

or

Phone

Edwin L. Beck, c/o

—

REctor 2-9570

Chronicle, 25 Park PL, N. Y. 7

or

Mr.

295

NI

8-0868

evenings.

Irving R. Neiblum
Madison

Ave.,

Syndication,

NY

17,

NY.

Volume 190

Number 5906

•

\Tr~-

Oiiw

r 0

ul£01 01

,

.

.

9

ww' sively the result Qf the outflow °£..given to the inauguration of the drawn from Central Bank and

/?^1a

A

/n-P

(2505)

The Commercial and Financial Chronicle

^xx^xx^v./ SSS^"?
interest
rates abroad.
AClverse XjUffli£6
f?nd?
T

G°ld corporation Treasury reserves and earmarked

This • Ltd. Thisfirm was recently estabestab- against privately
orivatelv owned gold
^nld cerpptfor some lished m Johannesburg, South tificates. Private hoarding of gold
time, without necessarily indue- Africa, with the object of issuing has been the source of much difing the British authorities to raise transferable gold
certificates ficulties in; France, India and

higher

movement may continue

In Setback of Sterling

based

the Bank rate.

v.

1

By Paul Einzig

-

result, the stock market, Dr. Einzig notes no

a

<as

sign of an adverse

sterling's technical position or in the Bank rate. While
setback occurred, the economic outlook remained unchanged,
improved, and the balance of trade stayed sound.

if not

short term funds attracted to higher interest rates

of foreign

Africa); suspects this sort of thing encourages private
hoarding; and ponders how this would add to our difficulties were

burg, South

another dollar scare shortage to

higher

the

International Gold Corp.T Ltd., Johannes¬

gold certificates (the

able

abroad.

business of issuing transfer¬

comments on another entry into the

He

In pointing

observer attributes the change to the outflow

out, the British

this

other countries. The encouragement of the practice is definitely

gold deposited with the
Bank of South Africa,

on

Standard

wages

against the public interest,

and especially
hours should

for shorter working

change in
this

if pressure

The
London
firm
of Johnson
Matthay & Co., bullion dealers
become
intensified
the
govern- and
refiners, is also associated
ment might feel impelled to em- with
the new corporation.
The
ploy the Bank rate weapon.against certificates will represent a cera "revival
of the resulting wage tain weight of gold varying from
inflation. At present there is more
bars of 50 grammes to bars of one
or
less full employment, but in kilo. The price of the certificates
some
districts there are indica- will be based on. the London price
tions of overfull employment.
If of gold, plus a premium of
for

sterling, gold and,

in

unpredicted -setback

sudden,

the

Despite

other hand,

the

On

for

demand

a

40-hour

week

by a firm with which the London

of labor and the wage
would resume its upward

spiral

are

gold- reserve.

end of
November

tie

Sterling was
consideredj to
b) as solid as

;

the

~

oitlook on the

;

Stock V

Land on

t i

i s ill-'i

m

;7There is no reason to suppose
that in the present instance there

present moment sterling is once
more in the center of interest But

Recent

)

favorable,

to

to this

-

Paul

Ster¬

flowing

country. The change in the

More

The

Gold Bullion Certificates?

importance of gold in the
..

..

-

sterling

must

have

uidity.
less

hoarding, would

gold

private

to

international

financial situation received atten-

Even though there is now
about the inadequacy
,

of tion at the beginning of December
been exclu- also as a result of the publicity

of. gold

reserves

Co., 61 Broad¬

be way, New York City, members of
liq-. the New York Stock
Exchange, on

heard

,

J

gold situation and in the trend

Einzig

Admit Partners

Jas. H. OIiphant &

Jan. 1 will admit D. Lionel Howe-

del and Walter G. Roden to part-

be a nership. Mr. /Roden has been

it would

relation •. to the

dollar,"' and the Stock'Exchange
really pessimistic, for the
first timesince the general elec¬
turned

This announcement is neither an

Already before the end of
there < was some talk

tion.

The

•

November
about

of an offer to
offer is made only by the Prospectus.

offer to sell nor a solicitation

less favorable gold

month, and partly ,in anticipation
of a de-control of sterling in the
future.

near

V

bay any of these bonds.

weakening of
anticipation of
figures for the

possible

a

sterling, partly in

$50,000,000

\

gold reserve
moderate, but it' was
-rise- .to speci
about the possibility of

The decline in the

;\vasV. very '

sufficient to give
tion

The outflow of

higher Bank rate.

gold

the result of the higher •
rates in the United States,

;

was

interest

G

Western

.countries,

•

any and other
While
until recently

,:

a lower British
widely envisaged,

-

5'/2% GUARANTEED

EXTERNAL LOAN BONDS

DUE

e r rn

Dated Decem ber 15)

i

Due Decem ber

1059

15, 1979

jthe.possibility of
/Bank

lithe

rate

was

decline of the gold reserve by
was sufficient to give

-

higher

-

Interest

payable June 15 and December

15 in New York City.

£18 million

;rise

to .expectations,, of„ a

%

be-"
.hind this change is that Britain
can
not afford. to lose gold and >
that the authorities *: may. 'decide
.

.

gold

credit

ground

that

would

mean

loans

ernment

dearer
affect

was

a

earlier.

a

Accrued Interest

the weak¬

Bank.

fall in Gov¬

effect

the

and

equities.

economic
it

Price 95Vi% and

Remains

higher

a

on

money

REPUBLIC OF FRANCE

of
V

on

'

rate

„

-

-

sterling brought about a*
the Stock Exchange on.

of

•

Same

The loss of gold and
'setback
the

ahead

years

Outlook

the

ness

au-

*'

'/

Economic

ky the

they could

that

five

maturity.

payment of principal and interest

the Export-Import

'afford to repay

/Bank

Unconditionally guaranteed as to

■

protect

self-same

the

decided

"thorities

•

Yet only a

reserve.

earlier

'month

rate to

the Bank

to raise

"the

f"""

\

.Bank -rate.The- assumption

-

Copies of the Prospectus man
legally offer these

be obtained
y
Stale from
n
onlyu
su ch of n
the undersigned
i
as
incompliance with theBonds
securities laws of such State.

may

of

business would

the

Yet

outlook

is

general

the same

as

month
indications

week earlier or a

Indeed recent

distinctly in favor of a revival
in
the
capital
goods
industry
which until recently took no part

MORGAN STANLEY &

LAZARD FRERES & CO.

CO.

are

business revival.
In reality Britain could afford
to
lose much more gold before
it would become necessary to re¬

in

the general

to

sort

dearer

provided

money,

that .the loss is caused by the
withdrawal of funds from London

the
all.
amounts of

not by a deterioration in
balance of payments.
After

and

the

presence

of large

foreign short-term funds in Lon¬
don is a potential source of weak¬
ness.

be

the

It is

offset

gold

a

DILLON, READ & CO.

INC.

BLYTH& CO., INC.

DOMINICK & DOMINICK

EASTMAN DILLON,

UNION SECURITIES & CO.

LEHMAN BROTHERS
STONE &

against

simultaneous

the

If

decline

amount

there is
in

of
a

the gold




1959.

GLORE, FORGAN & CO.

CORPORATION
•

CO.
SMITH, BARNEY & CO.

Y&
ELPICO.
RNAMIRRAH KIDDER, PEABODY &

MERRILL LYNCH, Incorporated
PIERCE, FENNER &

WEBSTER SECURITIES

December 9,

CORPORATION

*

Incorporated.

liability which should

reserve.

LOEB & CO.
THE DOMINION SECURITIES CORPORATION

THE FIRST BOSTON

GOLDMAN, SACHS & CO.

asso-

matter for regret if substantial ciated with the firm for some
amounts of gold were to be with- time.

,

discount, in.,

a-

until recently in¬

Jas.,,H.s01iphant to

detrimental

.

declined

ling

and

vestment capital has been

u'd -d -re;'n i

change.

figures

trade

:

-

the'rervwas 'a
s

change.
have been

the possibility of further dollar

scares in the not too distant future

wanting to hedge against devalua- should not be overlooked in formtion by buying such certificates, ing an opinion "about the new
holders of which are entitled to enterprise,
claim the delivery of the gold bars
they represent at any time and in
any country where it is lawful for
them to hold gold,
There can be no doubt that the

sibly have to be allowed to decline popularization of such certificates,
its lower support point of which would mean an increase in

nearer
$2.78.

..

month A

the

.

has been any such adverse

with-'

After the turn
of

,

i

Exchange was
vewed
op

~

American

But

dollars, and the selling pressure
banking firm, and bullion dealer would lead to a decline of .the
.At the
Samuel Montagu & Co. is associ- American gold reserve.

wage

the Bank rate until it
adverse change in the balance of
becomes clear whether the trade
payments, either through an in- unions
concerned would press
crease of
imports or a decline in their demand to an extent that
exports, or through an outflow; threatened to lead to an increase
of
long-term
capital, then the in costs and a decline in exports,
technical
position
of
sterling Meanwhile-' Britain may lose
weakens.
more gold and' sterling may P9S-

United

buyers of gold would be sellers of

y * -

important

gold is due to an'to put up

markets. Until

rock,"' and

bal- course.
the
Several

for

means of acquiring gold abroad
would add to the difficulties of
the United States authorities. It
is true there would be no direct
withdrawals from the American

ated. The new enterprise seems
de- more active, however, in .publiis capable of changing the senti- situation* remains
fundamentally mands will mature next month, cizing its certificates, and its aim
mints and the prospects of the unchanged. On the other hand if and the government is not likely is to appeal to the small man
the outflow of
reserve and in the foreign
ances by identical amounts,

LONDON. Eng land — It is indeed
renarkable how narrow a margin

facilities

States residents to hedge by

certificates

tries, the result would be an acute

gold

on

increased

already issued

based

scarcity

erupt.

similar

Somewhat

is conceded in a number of indus-

•

Moreover,. should there be a
revival of dollar scares in 1960 the

SMITH

WHITE, WELD & CO.

10

The Commercial and Financial Chronicle

(2406)

the

International Trade Flow

expansion

to

efficient

In the Years Ahead
New

i

>.

t-

of cargo

use

for

disposal

few

a

Thursday, December 10, 1959

nical know-how

policy,

commodities,

ability.
of

popuia-

a

tion of some 270 million, imports
at least twice the volume ot raw
materials we do. Any increase in
Europe's standard of living is
therefore quickly .reflected in its

ducing-countries.

intra-European trade
trade, both
of which involve relatively Tittle

-

sea-going' shipping;/
' A.The rapid recovery of agricul-

fores will

of

(3)

of

from

a

nationalistic

or.'

the

these

countries

split

reasons, and because
might lead to

of the fear that this

reli-r

greater

thfSo«

•industrial

personality t
They seek foreign
capital, man.'
agement. and know-how.
But for

The. growing demand for such
raw materials as iron and copper

in

and

Many

suffer

*

result

financial

f,lenZ
^bUitation pf Wester
juirope and Japan.

v

•

and managerial

.They also lack

ganization that made
possible

purchases from the primary-pro-

and of U. S.-Canadian
-

surplus

our

Western Europe, with

—

space

important shifts in postwar trade
* " '
There has been extraordinary

in a bank, which involved frequent visits to soma 30 countries, is "-<■
utilized by Mr. Moorein discussing: (1) prospects for growth of the .world economy and world trade; (2) problem of tha underdeveloped i

■

Except

patterns.

York, New York City

growth

y

in

due partly

quicker handling of ships in
ports. But it also reflected some

Considerable experience gained from supervising foreign operations

f

volume of

and

By George S. Moore,* President, The First National City Bank of
-

was

developments

technological

more

;

the

of

international trade

...

foreign. control

ance on African, South American,

have

some

and

exploitation

assumed

attitudes and
especially in Western Eu~ ,'and
Labrador
sources,
which adopted policies which
are
dis¬
rope, and the development of syn.- : means • move,? and -longer
hauls, couraging private
investment *,
thetics .which also reduced ship-i Bauxite
shipments, too, should
(4.) In their anxiety to
get the
ping needs.
r./expand if all the aluminum pro- better things in life as
fast as pos¬
producing or developing countries are not necessarily far from hopeSome
time
ago, the; Unilever ; duction facilities plamied all over sible, in response to
understand¬
less, and advises we keep our economic house in order rather than
people. estimated that synthetics the world are actually built.
On able social
pressures, many have
restrict imports. Mr. Moore favors removal of discriminatory rastricnow account for about 15% of the- the other hand, Europe's
growing ■ been engaging
y
inflationary eco¬
tions against our goods, says our decision on "tied";loans be used as ;
raw
materials .used, in manufab- self-sufficiency in breadgrains ancl nomic
policies. 'Many have cre¬
a bargaining lever, and hop?s recovery abroad will mean <rdecreasedt,;., v i turing.
This compares with about animal products leaves little hope... ated excessive

!:

ture,

of pay-ments deficit. The banking head envisions dynamic growth ahead and
:
need for additional ocean cargo space, finds the problem of primary
(3) the problem and solution to our balance

countries; and

.

.

.

.

.

.

.

-

<

,

,

need for economic aid.
:V'*J

'*

•
...

'

>:"•

If,

"■

i

during the

■■

world

everything
needed.

and
world
trade,
including

based

which I
is

the

This

avoid

can

major

the
primary
producing, or
develop ing

S.

Moore

Political

principal
'60s that the
industrialized

stability and

economic

standards.

pends

Trnn

Hpde

helping these areas
purchasing power.

of low
in

S.

U.

international

pay

ments, and what

we

Of the woild

do about it.

can

Prospects for the
World

of

the

trade

reflects

the

countries

DroductWity

tend

to

bolh

exchange

goods than do the primaryproducing countries whose proare

and

rate

_T

low!'

Statisticians
the

four

1910

world

duet'ioiv
rate

figure

decades

advanced

volume of trade

behind, at

at

The

an

growth

mad^ef'econo^
af®;^
J7~«
~

JYa
Ae

A

Wars, after some gain
the '20s, the volume of
back

to

basic

n

the

pre-1913

cause

nationalism

itself.

was

Every nation
imports and
of supply.

own sources

,,

,

,

Y,

-

.

Duinit, the postwar decade this

when the world went through an

boom, world industrial

nrlf tvl
of

about

6.5%f

This

The Postwar Trade
was

in

capital goods and

transportation
has

more

gainers

.

equipment,, which
Other big

than doubled.

have

metals,

encouraged

*

iron

non-ferrous

been

and

ore,

petroleum

products, which

are, of course, in
by themselves'. Rising conExpenditures have bee n

class

a

sumer

the

Expansion

reason

for

this

extraordinary performance?
During the earlier Dart of the
reeonstructimi decade,
to
1952, the 6iuwui
growth ui
of Iiiicrimuonai
international

'up

vuC

".rade

was

even

distribution

®ncl?s
0+• •?"*
-

epreneunal activity

?-

world




the

in

most

'

-

feeling that conditions

industrial

countries

are

quite favorable to the expan-

how

sion of ocean-cargo trade.

know, there has been

As

you

promising
business recovery in North America, including Canada and Mexico,
a

with industrial output considerably above the corresponding period
last year
despite the steel
strike.

In Western

Europe, indus-

+r5al production is ud almost 10%.

One

of

the

most

remarkable

re¬

That

•

?ln Europe s confimj*)* ®
n *bture restored,
or dynanl\C
SflnSL
^ai\ a <a
f

-

+cbangmg

aH H Y \as !ie dasire
remove
a/ obstacles to the achievement
1Y.1 n 8 standards
+

uY!? luh a-European

+.

coopera-

tion. This led to the establishment
0f the European Economic
Com-'

convinced

(Outer Seven). I
that the dynamism

this period is still with

us

am

of

and will

Australia and South

Western

may

and

the

trend

unre-

expenditures.

In

of

of the current business

expansion
likely to continue, with
principal
support
coming from
rising domestic consumption and
private
housing. * Thus far no
also

has

concern

developed over this
expansion, as it did during 1958,
except for a modest increase in
the German and Dutch bank rates

tightening

a

of

reserve

quirements in Japan.

Apart from
most
a

the

industrial

re-

countries

Most

of

them

are

in

are

po-

also

in

in many

But there will also be

w.^y

about

hold

total nopula-

one-third

gold

as large as
foreign ex-

and

change, freely convertible into
gold, eoual to about one-half of
hie

United

States

gold

stock.

The«e reserves give the industrial
countries freedom to pursue ex-

pansionary uolioies and to liberal+V.«

the

AJ

remaining restrictions

kets,

the

on

mary-uroHucim?

rh.vina

'"7.ex"
""
o

Suez

Crisis
Cl'isis.

the

months

keep

pace

with

industrial

and

countries

ahead.

There

ori-

of

world

strove

We

must

learn

now

world.

I

am

those

imagination,

with

live

there

busi-

the

quickly

world

conditions,

crops

ments

me

Another

there

is

solution; it will be with

no

us

for a

long time—but the balanced

eco-

there this year and

of

interna¬
is the In¬

Under this

be used for

proposal

could

also

development purposes.

Deficit Balance of Payments—
The
-

'

i

Export Problem

American

This brings me to

the last prob¬

discuss, our balance

lem I wish to

deficit and the Amer¬
ican
export problem.
To what
extent have our exports been af¬

of payments

the

industrialized

fected

by

normal

return to a
stable pattern

the

and

—

kets?

great because:
(1) As
over

a

result of developments

which thev have

no

control,

primary-producing and newlyindustrializing countries suffer
"i

from

•

-i

business

industrial

slumps
countries

in
—

the
their

Provement

in

the

fortunes

(2)

a

of

come

rise in export volume.

The
and

primary
the

-

producing

newlv-inHus-

It

is' still

too

early to an¬

questions, but several
factors have become clear.
swer

these

Some of

the

countries
shift

bauxite and
materials.

more
of in¬
ternational trade
and to what
nations of Western Europe, North
extent have our exports become
America and Japan join in seekless
competitive in world mar¬
ing" the answer. The problem is
that

from

a

raw

currencies

soft

some

easy

ore,

example

World Bank.

1 wish to discuss tonight—that of

which

being a
interna¬

ternational Development Associa¬
tion, proposed at the recent Wash¬
ington meetings of the Fund and

optimistic

for

iron

tional cooperative effort

prospect brings
to the second major problem

lem

of

other industrial

courage,

The Problem of the PrimaryProducing or Developing
Countries
This

of

objective

primary-producing countries is
assuming sizable proportions^ in
anticipation of growing require¬

and
flexibility
to
to these changing

adapt

advantage

and

to

in

that

great

subjecting itself to the dis¬
ciplines required by the IMF, and
freeing its trade, in return for full
membership in the OEEC. The
flow of European private capital

to

enough

sure

than

more

to

should

because of somewhat smal,Qr

a

in

year,

Still, this is

we

these countries will have to

prams, oilseeds, and cotton to

and

stabilization
effort, with
hope of success.
Spain took the plunge early this

during the postwar period,

during

heavier movements of bread-.
rone

This failure to

the

cur¬

establishing

market- rate

every

completely

more

Commodity nrmes have been more
01' less
stabilized, but any im-

?'?at e?.Ea»?io» r>£ the volume
oerhan*

the

there should be addiimprovement in the trade

countries

tional

cumbersome

heroic

in foreign marWestern European

customers. In recent years, their
terms of trade have deteriorated,

in

from

progress

This new approach has been in-!
creasingly successful.
Colombia
and Turkey are in better shape;
Chile, Paraguay and Pakistan areshowing improvements; and Ar¬
gentina is in ithe midst of an

as

switch

kind

build

«

activity estab-

records

far

tional institution.

Stiffer

many

new

between

cent

well

as

as

older

industrial

the

competition will have to be faced

demands

tion

free

neutral

plenty of

headaches.

Netherlands, with

world's dry-cargo shinpmg did not feel the effect of the
o£

and

nomic growth of the Free World,
and even our peaceful survival

ours,

is

in-many countries

controls and

single

ica.

highly liouid position.
West
Germany, Switzerland, and the
a

a

instances.

problem

Considerable

dismantling

rency

Europe, in Japan, and
countries in Latin Amer-

primary-producing, or develStates, • oping, countries. This is a prob-

strong balance of payments

sition.

in

the

United

some

the

has been made

in

from the Soviet bloc.

lishing

inauire at tin's point

rising

conservatively anticipate a modest
business expansion through most
of 1960, possibly
longer—subject,
of course, to developments on the

With

Reflect Trade Expansion

is

to large-scale production. We may
even
face increased
competition

imports.

You

durables

factories

front

Yet

hopeless/

A great middle class market for
consumer

As to business prospects ahead,
here in North America we may

tense

small.'

are

rencies, in

.

of

growth

Africa, are also doing well, thanks
partly to a sizable capital inflow,

irr^v

a^e dle cominte decade.

>

.

for

more
hydroelectric
and
more
tankers
to
carry petroleum products,

at home

ize

Dry-Cargo Shipping Fails to

more

.,

means

tries, such

3

i°

.

serves

Although they
urgently need capital, a flight of
cargo
capital has been stimulated
by de¬
busi-: clining confidence in
their cur¬

projects,

problems

labor

power

demand

adopting fiscal and monetary dis¬
iea- alone is expected to have ciplines.
These accomplishments
more than 250 million people,
have been due
largely to the co¬
The- world's purchasing power is
operative efforts of the Interna¬
increasing even faster
around tional
Monetary Fund, the World
4% a year: The 400 mililon peoBank, the U. S. Treasury, and
pie of India-hope to double their many private financial
institu¬
per capita incomes by 1970.
Only tions. A favorable change in the
those who have seen India have
political climate is a number of
an
inkling oL what such an in- these \ countries
has
supported
crease implies in the
way of exthese., steps.
The
International
panded output of food and indusMonetary Fund in particular, has
trial products,
performed a highly valuable func¬
World consumption of energy is
tion
in representing prospective
more than doubling every decade,
creditor countries.
The Fund has

coveries has taken place in Japan.
Some of the industrializing counas

increased the

—

Expansion of.

World Ocean-Cargo Trade

It is my

and

about S " ZI fU"J'

stimulated by the
of

Prospects for

+

was

topped by the growth of world
trade at the rate of about
7.2%.

What

"

n

A°mp e ely r^trS+td* munity (Common Market) and
Plan ^'bcian
W7
proposed European Free Trade
began, ™to
to
1957, tlie
Association

Mai
Marshall
shall

rate

8'

I,nh

^

eco-

the Great

and

reduce its

develop its

a

;

Y,marikable
Europeans

nn™

began to flourish.

two World

wanted to

trade

con-

world trade are here. The population of the Free World is increasing at the rate of about 2% —
nearly 40 million people—a year,
By the time the so-called "Surging '60s" are history, Latin Amer-

a s

is

During the period between the

Depression,

World

which has

addw

h

y

in general...
Thei conditions

^Liction and productivity which

lagged,somewhat

may

ness

the

of

we

space, and therefore to

annual

-

The

transportation,

purchasing

for

hand, the impact
industry
and

in

for

solid advance in their

fell

/

other

ness

living standards.

nomic

the

investment

Europe and Japan, the momentum

achieved

levels.

On
of

Pro§ress of West Germany was
EOt lost 011 others' Therise in pro¬

nro-

f

trade

at present.

be

peaceful era during
which people all over the world

during

some

this

spectacular

°c aY G}11]

a

a

be

will

an

were

would

de-

annual rate of 3.3%.
These are good figures to rememher, because those pre-1914 decades

I believe that

ever,

fidently look'forward to
40% higher than, tional
requirements
for

Western

ab

to

1870

manufacturing

of 3.9%.

.

?larb//dY ca?rin«^e ^evival ,of die

that during

from

'

Nothing succeeds like success,
Tbe .r?le played both by currency

investment

of

pjanned economy in West-

encouraged
corporate and individual saving and investment
and' by repressinS inflation, gave
™e stable basis ^r planning

nmre

ductivitv

primarily the

^volveda^ton to mone

Mgh

with

was

of the gradual abandonment

of the

Europe and elsewhere, in
favor of a market economy. This

^

world

decade

?esult
ern

Economy

International

H^d to° toe
Iiiftustrial

pOS{war

and the rest

Growth

and where inflation and

The great upswing in
savings,
investment, and foreign lending
during the second phase of the

Third, the problem of the deficit

Exceptions were counpopulation outgrew

political instability impaired balancec^ development.

our

on

a

where

resources

on

Pnrtnin
Curtain

Iron

tries

bal-

a

development

the

of

materials

raw

into the main industrial countries

■

through

period
of
unprecedented
expansion of
the means of production and an
unprecedented
rise
in
living

the

of

the

of

prosperous

side

-our

But by that time, world

of

use

natural

of

was

the world went

countries of the Free World must

anced

deferred

ports

demand

cargo

therthe^e-staples except during years„ fpi;. imports.,: With.,a few
excep¬
synthetic's,ira-9of shpct crops),-, Altcjn all, how- tions their - gold and dollar
re¬

.

George

countries—one

more

of

increased

increased

it not,.for

were

reflected in the increasing volume
getting
its
second
of
world
trade
in
fresh
fruit
breath through a great upsurge in
savings, investment, and foreign (bananas, citrus fruit), drugs, and
consumer durables.
lending.
In fact," from 1953-57,

_

challenges

satisfaction

demands.
trade

Second, the
problem
of

face.

particular

the

with

wars.

_

foreigners, wno

phase of the
postwar trade
expansion ended
with the recovery of production
abroad beyond prewar levels and

think

we

world
limited

perennially
complaining
about the "dollar shortage."

reasonable,

that

of

were

sumption,

•a s

hands, of

the

in

n g,

on

up-

We here in

rest

the

is said that

1 It

only by the availability of dollars

going

shipp i

.

Our exports were

for

3% before the Second World War.

.•

■

the United States and Canada had
exportable surpluses of practically

years

economy

ocean

J

wartime

by

created

sources

'

•

•

'.1 tti'mi

i

ahead:
Firu, cne piospects for growth of
the

-

<

.1

:

■

trade." sets and destruction.

of the international

outlook

•

principal'

t intend to discuss three
aspycts

'

were

our

bound

to

development of

exports, like
decline

coal,

with the

additional energj

supplies in Western Europe.
Some of the advantages we
in

technical

knowledge,

had

skilly

capital, and entrepreneurial abil¬
ity were also bound to diinimsu
as productive efficiency increase
in Europe and Japan.
This w
must accept as a natural historical
development.
As

a

government price
acre¬
marketing, many ox our

result of

trializincr countries still
lack, to a

supports and restrictions on

large extent, essential skills, tech-

age

and

-

Volume

Number

190

5906

.

.

The Commercial

.

and

Financial Chronicle

(2407)

Sieves the development loan bur-

arm
products can be moved in
nternationi.il: markets only' with

subsidies

of

help

he

surplus

or

We

lisposal programs.
failed

have

■We

to

iroducts

of

foreign

.

our

countries,

export business is

joint.

.

'

luring the postwar period and
mderestimated' the comeback of

competitors. But there is no
need to panic. .There are many
iroducts. in which we have a natmr

tral advantage. :We have excelled

industrial

the

n

ideas

lew

application

/

of

innovations,

and

enough, I : derive more
"regarding
ourexport
iroblem through talking with for-

Strangly
•omi'ort

;igners than with many of our
>wn
exporters.' Europeans point
Hit that we still have a good lead
n

fields—such as packaging
that wes are fa-

many

nachinery—and

mix."""

wred by our "export

61st

immediate

Institute

removal

oi

outmoded

Economic recovery

abroad has- removed

in

case

a

•

,

ond

developing the.back-*

ward countries of

insist, as we aiu at the
GATT meeting in Tokyo, on the

our goods.

general, we had it too easy

1 In

World

any

you may nave,

noticed,

e

U

n

i t

address

by

Waldorf-Astoria
Nov.

Mr.

Moore

before

the

Anniversary, Dinner, The American
of
Marine
Underwriters,
The
19,

.

Hotel,

1959.

-

New
)•

York

City.

d, Kingdom",

Dominick'Firm

a.

rate above $4 billion.

loss

The gold

held down to $950 million

was

the first 10 months. A
number of explanations have been

during

Mfered: higher interest rates here,

reviving

investment

trade,

op-

outstanding obligations.

Our

de-.

1 termination to eliminate the Federal deficit has made

urable

contribution

immeas-

an

bulwark-

to

ing confidence in the dollar, v
Although
one-half

still

we

the

of

cannot afford

have

world's

^

to

Nor

continuously to

lose
we

can

run up

our

short-tenia

indebtedness,- now
$16 billion.•

around

^

gold, 'we

to continue

it at the recent rate.
afford

over

-

Briefly,
plus.of

have this year a sur$3 billion in .our...mer-

we

over

chandise

service

and

accounts,

result of the

a

Cold

War.: Our

years.

shore purchases of military hardr
Mr.
Wick
is
with
the firm's
ware could probably be reducedBuying Department. He has been
,
Some of our economic aid—also associated with
Dominick & Dom¬
motivated by reasons of national inick
for four-years and was presecurity—is, probably outdated in,
viously President of PM Industries.
the light of progress made in some
of the beneficiary countries during the past 10 years. Greater encouragement could lie given to

Baker, Weeks & Co.

government projects—by means
of investment guarantees, tax lib¬
adoption of
West¬
ern Europe and Japan should also
be brought into programs to help
backward areas. The proposal to
and

eralization,
the

the

Bogg's Bill objectives.

International Developjnent Association as an adjunct of
create

an

the World Bank may be one way
to do this.
■,
There is, of course, a good
chance that the expansoin-of the
world economy and international
exchange of goods will help to

To Admit Partners

leading

Exchange

and

exchanges,

an-

Continued from page 2
return to attract the large amounts
of private capital so necessary for

the continued building
pipe lines in'Canada.^ *

In

its

reduce our payments deficit durhag the months ahead to manbillion), government grants and. ageable proportions—say, someloans
associated
with, our
ecowhere between one and two bilnomic- aid

lion dollars. I have not the slightest doubt that the '60s, will bri.rtg

lion).

Weeks

&

Co., 1 Wall
Street, New York City, members
of the New York Stock Exchange,
will admit Rodney G.
Courtnay Pitt to part¬
nership.
Mr. Pitt will make his
headquarters at the firm's Phila¬
delphia office, Philadelphia Na¬
on

Jan.

such an expansion' in < trade-in
view of the growth of population

tional Bank

pany

Energy Board the com¬
estimated that,..assuming an

on

of

sales

million

$86

V

NEW

First,
nomic

balance
.'

a

liberal trade pol-

strengthen

we

of payments
we

position?
keep

can

house

in

bal-

our

On present

'

our

eco-

We

order.

about

capitalization

Frank J. Eisenhart

million

7

shares

can

John M. Gallagher

tract,,, sufficient 'to

meet
both
export re¬
favorable An¬

appointment of Frank
J. Eisenhart as Sales Manager and

Canadian

John M.

ticipated demand curve, the future
looks very bright foT Trans-Can¬

the

Gallagher

Corporate
their

of

ment

fice,

as

Street.

Walnut

1401

Manager of

Finance Depart¬
Philadelphia of¬

present

and

income

Hornblower & Weeks for the pas.

ficial

14

before

years,

a

ada and should reward the patient
investor who

have been associated with

Both

and

quirements

for

is willing
few

a

the

of

the

company,

12th

strain
to

other

make

petitive.

We

which*

factors

less

exports

our

can

com-

keep our interest

rates high enough to attract more
savings.
In general,
we
should
adopt the monetary and fiscal disciplines that our Western Euro-

pear!.'competitors accepted to con..the
inflationary
pressures

tain

within

their

gender

spective

done

and

their

in

currencies.

foolhardy
ing

economies

confidence

would

It

en-/more
re-

be

part, after havmuch
to
promote

on

our

so

progress and stability abroad, to
throw it all away because we our-

selves

do

not

have

the

primary-producing countries, and
with it the prospects of the shipping industry. More help is likely
to come from Western Europe,
which normally imports more
than twice as many primary com¬
modities as the United States,
Moreover, these purchases are far

Hugh W. Long Co.
Elects Powell

of

last

Montreal

June,

N;"i

has

should

company

good."

investor

stock

common,

fully

I

be

fund

mutual

leading

He represents

in Arkansas,

spon¬

the company

Oklahoma, Texas and

western Louisiana.
Before
pany

joining the Long Com¬

in 1957, Mr. Powell was as¬

sociated

with
of

firm

ment

an

Dilbert's

.;

the

Dallas

Eppler,
_

invest¬

Guerin

&

exceedingly-

concur

Admit Gilmartin
On Jan.

1

2

Street, "New

York

City,

of the New

York

Stock

Wall

members

Morgan Stanley & Co.,

Exchange,

admit; Roger

will
to

partnership.

offer to sell nor a solicitation of an offer to buy any of
offering is made only by the Prospectus.
9, 1959

we

self-dis-

the

compete in

world

helped to create.

We should not want to strengthen

our

balance of

payments posi-

Hon

by restricting
merchandise
imports, after striving to liberal•

Quality Supermarkets Inc., Guarantor

maturity, subject to adjustments for certain events.
>.
Stock are being offered only in Units consisting

principal amount of Debentures and 12 shares of Common
The shares of Common Stock and the

ize

the international

goods which

are

exchange of

either not avail-

able from domestic

sources, or

not

around

Conditions

the

world

in

investment

many

ways




re-

■

bloc

two

they

pvnoifers

a

may

burdens

vigorous

partners

—

and Japan. Alniav both give our
for their monpy,

Europe

Western

they

private

obtained in any state in which this announcement is circulated
from only such of the undersigned and other dealers as may lawfully
'
offer these securities in such state. ;

S. D. Fuller & Co.

Haupt & Co.

Johnston, Lemon & Co.

Courts & Co.

/

H. Hentz & Co.

Sutro Bros. & Co.

Zuckerman, Smith & Co.

rnn

also share in the
defending the Free

now

of

-

Ira

phase.

ouired

Unit

The Prospectus may be

The reconstruction

may
be entering a
The time has come
for the reassessment of our role in
the world economy. We have ac-

munist

the

of

separately

(plus accrued interest from date of issue)

period is over. Even the relations
of the Free World with the Com-

though

flow

'

Stock.

Debentures composing a Unit will not be

Price $51.20 per

.

produced here in sufficient quantities. Nor can we interfere w;th

capital which

-

of $50

transferable until January .10, 1960.

the recovery of Eucapital markets promises

have changed.

new

Stock of the
1961 and thereafter at $4 per share

The Debentures and the Common

producing countries should be the
chief beneficiaries,
■

Stock

convertible, unless previously redeemed, into Common

Company at $3.75 per share on or before December 31,

-•

cipline to

December 1, 1979

(1 £ Par Value)

increased outflow of European
capital. Here again the primary-

his

with

Morgan Stanley to

diversified than ours,

ropean

this

in

remark.

Gilmartin

:

600,000 Shares of Common

an

the

for

Elizabeth, N. J., one of Amer¬

ica's

5%% Convertible Debentures due

Similarly,

of

that,

stated

prospects

$2,500,000

until

Conven¬

SocietiesM in

Analysts

Dilbert's Leasing & Development Corp,

are

An of¬
speaking

Annual

"the: long-term

J.David J.
been elected
a
Regional
Vice-President
oi
Hugh W. Long & Company, Inc.,
ELIZABETH,
Powell, Dallas,

Financial

December

The Debentures

to forego

yeai's.

tion of the National Federation

ISSUE

Western European and Japanese
trade. This, with some increase
in our imports, has already con¬
tend' tributed to improvement in the

be

would

outstanding in 1963, profits would
be $1.19 per share.
v
" *
With gas reserves" under con¬

nouncbs the

budget, as the government is already trying to do.
We
can resist the
wage push, and reour

$119

share would be equivalent
to 78 cents in J961 and assuming

these securities. The

living standards of all peoples, v
World
trade
outside of
the
United States has already reached
the levels of 1957, largely because
of
the
re-expansion
of

of

sales

on

net per

This advertisement is neither

.

can

$8.3

million, and

1963

in

million.'

Turner, Inc.

Building.

•

How, under

the

to

export.permit will be granted, it
would earn $4.52 million in 1961

1

Fiske and

improvement, a - temporary and the accelerated rate of instrengthening ©f our balance of vestment almost everywhere, Even
payments
may
well take place if world trade does not. grow as
during the fourth quarter.
rapidly as during the 1948-57 period,
its
more
stable
pattern
Steps to Be Taken
should allow for solid gains in the

icy,

V

-

submission

recent

port

ance

major

of

National

sors.

Baker,

Against this surplus, there is private capital outflow
(around $2

and sOme prospect of a modest ex-

t t ;i
r>
,
-i UIxVC JDtzO L

.

■

($2.5 billion) and military expenditures abroad ($3 bilWith imports leveling off

Stock

,

\ portunities, and the repayment of private capital—as a substitute for
l

;

Weeks, members of the

York

other'

'

Appoints 2

PHILADELPHIA.
PHILADELPHIA, .Pa.^Horm
.
Pa.«—>» Horn
New

military expenditures are moti¬
Mr.
Starring is the
resident
./•
Payments
vated by the facts of life in a dir
partner in charge of the firm's
.]
On the other hand, there is no videcl world.
It is essential that branch office
at 150 East 42nd St.,
worn for complacency.
Our mer- • we
maintain adequate /military. New York. He has been
with the
jhandise exports offer by far the establishments
abroad.'
But'
a firm
for four years and was previ¬
rnost feasible way to plug the dellarge portion of our military out- ously with R. Hoe & Co. He is
icit in our international payments., lays goes to the mutual defense chairman
of the Board of Trustees
This deficit was $3.4
billion in burden. Our cash outlays for.oif- of the Harvey School.

billion/ .This year, foreign
are acquiring dollars at

Weeks

,

as

countries,

n

<& '

Elects Partners

Dash Deficit in U. S. International

$2.3

i

blower &

justifi-

cation for them. As

the

"An

Japan, and France-have already
A ■
announced' further liberalization
of their dollar imports. ..Britain
Donald
D.. Mackey,
William
T„
has also ~ removed restrictions on
Smith, Mason. B. Starring, III, and
travel abroad/
/>,■>;'
Myron: A. Wick, Jr., have beenA We are ''tying"; loans made by
elected general partners in.Dom- •
the Development: LoanrFund: to
ini'ck & Dominick, 14/ Wall "St.,'
our exports, in much the same, New York
City,, members of the
way
that Export-import:: Bank New
York
Stock
Exchange, it
loans are "tide." * This i.ecisnon has been announced. ' i
•'/'...
should, however,; be regarded; as'
Mr. Mackey, who has been with
a bargaining m o v e to encourage the firm for 20
years, is in charge
other industrial countries to In- of its. Municipal,;Bond Departcrease
their own assistance to1
underdeveloped areas.i *
Mr., Smith, who is in charge of
vt* We are taking: a closer look at the mechanical operations of han¬
the
international '"burdens- vtc dling securities at the main
office,
more-of-fess voluntarily assumed
has
been
with
the
firm
for
36

1958, resulting in gold outflow, of

yr

Asia and Africa. *11 OrilDl0W6'F

can

discriminatory restrictions against

needs

of some of our automo-

loss

>ile

.

adapt

changing

the

tastes

ind

Phe

to

'!

dens of the U. S. Treasury.

11

"IPMilf

T,

12

Chronicle

The Commercial and Financial

(2408)

:..

Thursday, December 10, 1959

it

IV

Co., of Canada, and a Direc¬
other companies.
Mr.- McConnell, is a Director of

ance

tor of numerous

"Star," and

the Montreal

mem¬

a

Board of Management

of the

ber

Hospital.

of the Montreal General

•

•

Ahead of the News

•

By Roger W. Babson

values, Mr. Babson calls for dedicated progress toward reviving old

shopping centers may be fads that have reached their

new

Mreets for autos and

zenith, and envisions future ciths w»th
rear ones

The United States Senate is often

control

referred to

tion.

club.

for truck deliveries.

But

study of the body

a

veals-that

rich man's private

a

as

its

rich

men

are

re¬

was

the

if

hardest work¬
There

various tests for select¬

are

will

cities

house

slums.

test

merely for

or

t.

One

is

popu¬

m e n

lation

invest-

an

and

of their

business,

would

long been conscious

man

a

and

his

the

concerned about air pollution but

share

of

tax

rat e,

just awakening to the'impor¬
tance of proper ^zoning,-'and the
development of parks, forests, and
conservation
projects.
Although
we have only 60 people per square
mile, compared with Japan's 620,

worldly goods

supply,
and—very im¬
portant — the
condition
the

of

the

schools,
churches,

and

the char¬

acter

yet traffic conditions in Japan to¬
day

the

of

people.
Although we
in

now

are

better than in the U.
would

a

Roger W. Babson

their money.

increasing rapidly,
yet we are not using this wealth
to improve ohr daily living.
We
certainly have not provided the
mobility for our citizens which
good business and good health de¬

Conclusion

lines

streetcar

Our

are

In view of

investor
much

in

estate

parking

control.

road

above, the wise

attention

conditions,
new

the

real

more

is

giving

to

traffic

space,
and
one builds a

When

home, the value of the house

going into bankruptcy; our rail¬
are
giving up passenger

the

business;

the value of the land will increase

roads

roads
are
over¬
private cars and

our
with

crowded

trucks.
Therefore
people
are
moving to the suburbs while still
working in the cities, creating an
impasse in mobility within the

cities.
All of the above means that the

cities

best

which

invest

to

proper

traffic control,

by

Laird, Bissell
&
Meeds,
120
Broadway, New York City, mem¬
of the

bers

change,

York

as

centers, with proper traffic regu¬
lations. The new shopping centers
fads

may

be

their

zenith.

which

are

now

at

Chambers of Commerce, Boards

roads, provided ample of Trade, and Merchants Associa¬
and are making tions should therefore give their
trucks
and
pick up at primary thought to improving the
night. Although our present pros¬ transportation and parking facil¬
perity is due largely to the auto¬ ities of their cities. They should
space,
deliver

the
pass

his

manager,

division of

work

Stocks.

management

in

Mr.

mutual

company

se¬

up

Carlisle

I

Bargeron

being

their

business.

them

a

Senator

a

working at
seems
to give

It

62

sales

he

is

times

department.

considered

millionaire.

a

described

Detroit Bond Club

his

at

He has

Indiana's

as

three

or

been

of

Man

When in Washington, he

Energy.
is

two

desk

o'clock

9

at

The

event

Sheraton

will

be

held

at

the

Cadillac

Hotel, Detroit,
Feb. 3, 1960. The guest
speaker will be Dr. J. Philip Wernette, Professor of Business Ad¬

Mich.,

constant

a

on

ministration

at the University of
Michigan and Editor of the Mich¬
igan "Business Review."

tends

all

committees

the

there

seeks

answer

to

he

four.

would

Next

And

he

boost

ar
i«
yeah
is

taxes

gas

election year.

an

It is difficult to see,
Eisenhower can

every

to

An aggressive,
fellow, he does
tangle with any¬

the

->sharp-tongued

a

either, how

Mr.

for

request

fight

on

with

Tax

the

cost

of

his

increases

inflationary

as

in

his

square

increases

inflation.

just

are

even

only

one-half percent.
ercei

creases

in¬

as

goods and

services.

Senator Morse.

Probably

the

Senate's

richest

is Senator Kerr of Oklahoma.

man

He is

indefatigable worker and
is
responsible
for
considerable
legislation. He, too, works his staff

Clark, Dodge to

and

likeable sort
hesitate

the

budget he may as well look else¬
Congress refused to touch
the postal rates at the last session

part in the debate.
not

rates

balance

where.

belongs,

roll call.
On the floor he frequently takes

body,

depending

postage

to

priations and against all taxes will
be strong.

are

of

in

taxes

gas

of callers, at¬
meetings of the

which

to

of which

in

The old itch to vote for all appro¬

stream

of

increase

an

and

reason

*

He has

6 o'clock in the afternoon.

Party

*

every

morning and seldom quits before

Winter

some

so.

If Mr. Eisenhower is
on

tional

stock

doing

*

life.

new

There's Senator Homer E. Capehart of Indiana, for example. At

and

for

been

curities, was formerly with Hayden, Stone & Co. in the institu¬
research

seems to have been a most
inept
time for the Bishops to
speak'up
but they are not stupil men and

they must have had

at

had

they

a

likely to

people who do not believe In
control
themselves
taking
the cudgels against Kennedy.

It

mind

harder

than

become

are

birth

declining
ones

You

find

away

in

Protestant

and

grow

political issue.

Senate

The

Lynn

and

grow

to

days.
have

specialist

a

of
to

associated

Management

Shurtleff,

O.

Ex¬

like

member

a

become

has

with them

Stock

that

announce

Shurtleff

Fund

New

This is something

year.

their

parking

Snurtieff

Lynn

DETROIT, Mich.—The Bond Club
of Detroit, at their Board of Di¬
city newspapers as well as real
rectors' Meeting, completed plans
estate agents should emphasize.
I
for their annual winter party.
believe in reviving the old city
year

those which have wid¬

money are
ened

in

declines from year to year; but if

city has

be

fund

i

.fs

wealth

serve.

S.

and transportation
justify increas¬

living

ing taxes; people would accept a
higher tax if they got more for

period of
prosperity
with

are

Better

Conditions

would

birth control

the

up and insist
Kennedy's attitude is based
on
the
law
laid
down b.y the
Bishops of his Church. It is expected that the controversy will

•

obtained

are

water

of

that

others

are

then consider

on

clergy have taken it

ching 60
having

r e a

pollution, and most cities
water today. Some are

of water

have pure

asked

could

some

He said
that
for it this

same.

methods.
But

na-

Kennedy's attitude

nation

any

natural

seem

that
have

about the

giving, education

It

living

and

on
any overpopulated
Senator

Government

ers.

them manu¬

not leave

facturing,
v^iaes

growth;

the prestige

restore

ing the right city to buy land for
a new supermarket or apartment

BARGERON

Appoints Shurtleff

city centers with efficient regulation of vehicle transportation. He
believes

CARLISLE

BY

Laird Bissell Meeds

Discerning a correlation between proper traffic control and real estate

an

Bacon, Whipple to
Admit Buchan

:

Bank of Montreal

Jan. 1 will admit Nelson R.

freedom; but, paradoxically,
this industry to which we owe so

Elects Officers

H. Waterhouse to

partnership. Mr.

CHICAGO, 111.—Bacon, Whipple &
Few Senators like Co., 135 South, La Salle Street,
members of the New York and
tangle with his sharp tongue.
Now 90 years old, Senator Green Midwest Stock
Exchanges, on Jan.
of Rhode Island, a bachelor with 1 will admit Andrew D. Buchan to
oodles
of money,
is still going partnership.
strong. He is a strong-willed man
of the liberal persuasion. Not in¬
frequently at long committee hear¬
ings, he will be the only Senator

Waterhouse

make

who is not

much is also

MONTREAL, Canada—Richard G. quarters

mobile,

is

it

this

industry

very

which is

revolutionizing our cities,
and crumbling real estate values.
We owe much to Henry

Ford, but
I wish
he were alive today to
help us out of this dilemma.
Motor Age

The

Problems

automobile

has

given

all

threatening to stran¬

and make

things as they are, but to
forge ahead and prepare for the
Teat changes which are already
in progress.

live and

cities.

new

These

us

be

may

Admit Three

Ivey,

York

Elwood B.

Q. C.,

the

1

blamed

present

New York

condition.

The New England lo¬
cality in which \I am writing this
column had its streets laM out
by
cows

paths

300

years

were

These

ago.

cow-

gradually widened for

ox

and

G.

Ivey

David G. McConnell

since 1941, has been elected a VicePresident of the bank, and David
G.

McConnell,

the St. Lawrence

ited

today's problem. But, oddly
enoueh, most city residents do

Ltd., has been elected

not

nounced.

autos

about the

or

set

congestion,

very unset

so

ners
find it hard to
mendations adopted.

get

recom¬

It is hopeful that cities

the

are

employing traffic

demand for

a

Sugar Refineries

it

are

Director

been

an¬

of

Louis

L.

the

Lang,

be¬

en¬

joining

ment

Belnap, B. C. Gardner and
Dinning directors, who
statutory retire¬
ace

of

75

under

the

Ca¬

nadian Bank Act.

Mr.

Ivey

is

ST.

Coast

Jan.

on

1

will

M.

Wosser

to

has

been

with

part¬
the

Dempsey-Tegeler

LOUIS, Mo.—Lewis

and

Floyd

associated
&

bers

was

Mr.

&

Partner

L.

Walker

E.

of

Dowler, Pres¬

ident of the Northern
Life Assur¬

feeble

are

Senator

now

of

New

York

and

Walker

was

with

Johnson,

ning

(Special to The Financial Chronicle)

LOUIS, Mo.—Larry T. Drebes

has joined the

Gardner,
of

staff

400
the

of

Reinholdt

Locust
New

Street,

York

Midwest Stock Exchanges. He

formerly

and
was

for

the

Heitner & Woods.

with

Yates,

Democratic

Presi¬

Co.

York

J.

E.

member

a

usually

activity

Most

tly£

the

recent

statement

Bishops

hurt

It

commentators

is

his

not

against

candidacy
that

there

any movement towards

control

but

cent

and

to

City. Officers are

birth

speak

just when
they did had the effect of empha¬
sizing Kennedy's Catholicism. It

President; Vin¬

Martinelli,

Vice-President
M; Hindley,

Secretary. Mr. Martinelli is an
of H. Kook & Co., Inc.

Calif. — DempseyCo.
has opened a
branch office at 239 A Street u
der the management of Edward
DIEGO,

Tegeler

Hope.

&

Mr.

Hope

thereto

was

Co.

Asltor & Ross Admit
Goldberg wj1
membership 'n the
Stock Exchange and will Dea partner in Astor
& rt ->

feel

the

acquire

way about t^e sublet.
Eisenhower said the matter

Mr.

York

was

same

long

political question and that
as

he
no

was

President

move

to

force

as

ttrnre
birth

formerly

Securities & Co.

President

Eisenhower

was

Eastman Dillon,
and pi
head of E. S. Hope

local Manager for

Union

On Bee. 10 Alan M.

would be

ol-

Dempsey-Tegeler Office

seems
to have put
him on the
spot, notwithstanding that he and

a

Ed¬

J. Hindley,

Treasurer; and E.

SAN

Catholic

control

York

rich family, is ficers

Presidential nomi¬

political

the

birth

a

active,
although
his
recently has been spent

that

agree

of

pf

New

ward

Senator Kennedy of Massachu¬
setts, another Presidential aspir¬
ant, and a rich man, particularly

not

associated

E. J. Hindley

Formed in New

dential nomination.

irreparably.

Reinholdt, Gardner Adds

lot of

P.

changes, will admit Edward
Cawley to partnership.

Hindley & Co., Inc. is en¬
wealthy man who keeps
gaging in a securities business
He is busy right now.runt, from offices at 7
Stuyvesant Oval,

busy.

Mid¬

Exchanges. Mr. Fleer
formerly with Bache & Co.

recent
a

Symington of Missouri

with

the

in

delegates

now

1

is another

is he

Fleer

Lane, Space and Co., Atlanta.

ST.

now.

interesting.

little

a

and

CLEVELAND, Ohio —On Jan.

Ball, Burge & Kraus, Union Com¬
merce
Building, members of the
Life would
New York and Midwest Stock Ex¬

Murray of Montana is
wealthy man. But he has

very

west Stock

&

down

Dempsey-Tegeler in seeking
Co., 1000 Locust Street, mem¬ nation.

members

Senior

Ivey, Livermore

to be

was

a

Director; and

Robert J.

solution which




J.

a

has

appointments follow

retirements

of

have reached the

ginning to studv the traffic
prob¬

Newspapers

bank,

Vice-President

Vice-President and
Can Be

are

the

These

city plan¬

FJ'mhiated

gineers.

of

L.

Traffic

lem and

Pacific

(Special to The Financial Chronicle)
Richard

wagons, then for horse-andbugpies.
Most cities have inher¬

own

He

With

2

hard

Senator

for

messy

let

a

firm for many years.

be

can't

his work to his staff.

Frank

No city should
getting into the

worked

It is the way they
their wealth.
They

Levy,

Exchanges,

"ground floors."

have

men

cease

grown

nership.

two

These

London

Montgomery Street, members of

the

stores

Ball, Burge Firm

To Admit Cawley

dozing.

years

have

our

firm's

head¬

Calif.—LawWilliams
&
Stern,

Stock

and

his

FRANCISCO,

admit

stories

Charles

all their lives.

to pick up and deliver merchan¬
dise; while our sidewalks will

two

and

Admit Wosser
son,

wholly for trucks

will

in

Exchange, on
Jesup,

Ness

Lawson, Levy Will

streets for autos.

very wide
In the rear may

Van

accumulated

SAN

very

Stock

office.

long and narrow, with
be streets meant

to

Clark, Dodge & Co., 61 Wall St.,
York City, members of the

New

Chancellor
of
the
work in city caves. Yet fhe big¬ University of Western Ontario and
gest part of the transportation a Director of the Bank of Montreal
program has barely started.
The
huge roadbuilding program will
not only change the faces of all
cities, but will set the location for
us

hard and long.

New

us

new

gle

remember that their task is not to

keep

come

111

a

New

ork

of the New

York

Broadway

members

C9*A
-

Volume

Number 5906

19G

.

.

.

Chronicle

The Commercial and Financial

The

defense.

Municipal Bonds' Immunity

,

Reviewing the basically unchanged issues since 1938 to data involved

and

such

the

as

Association

the

of

Powers

of

preparation

Attorneys

of Princeton

Confer¬

Taxation

hearings on "tax-loopholes" and for deliberately excluding

National

most

of governors, mayors

Law

Insurance

Association

constitutional principle exempts them too. Regarding the latter
Port Authority allows any "pass through" and
shows how this is handled.

»

,

K

formulate a' plan of coordinated
action that we all knew was going
pets and consequences of federal to be essential to the preservation
atacks on the immunity of state of the sovereignty and financial
is not the first occasion on
wiich I have discussed the prosTlis

integrity of state and local

aid municipal

In

| just issued an official pronounce¬
ment taking the flat position that

l!38 when the

Treasury was
nounting
a n
al-out attack

strumentalities

iilmunity, the
talk

first

I had

made

subject
d

that
the

before

gov¬

no

Tanguage "the principle of immu¬

that group.

nity" protected "the Federal Gov¬
ernment against taxation by the

19 4 5

In

state

the

exceptions whatsoever
and that in the Department's own
admits

was

e

of

that the national gov¬
ernment's
power
to tax income
"from whatever source derived"
ernments;

ever

on

was

power

supreme and included the power
to tax all the functions and in¬

that

against

taxing

Federal

the

J.

Austin

Tobin

that

Public

and

the force
the

to

Congress

the

course,

to

was

ference

State

on

position

Defense

current

to

in

op¬

to

their

of

argu¬
of the

attention

and

Counsel

Treasury

of

efforts to tax municipals.

the

and

the

of

days

Conference

Conference

When the

organized,
quite

had to

We

forces

with

faced

were

we

task.

a

own

our

first

was

was

investment

and

obviously necessary to
the immunity of state

so

preserve

local bonds.

and

It

the

was

sur¬

prising fact that few state and
municipal officers in those days
realized the critical importance of
the

immunity

former

governor

since

me

those first

State

succes-

...

waves

the

Forum.

And

again

Our

counsel of the Bureau of Internal

1946

in

beDave Wood and I appeared before fore the Investment Bankers Asthe Municipal Forum to comment sociation that "there was no basis
on the
Saratoga Springs decision. for denying the power of the naI
Many took a very active part tional government to tax the peothroughout those years in assist- Die and the institutions of the
ing state and municipal officials state."
from all parts of the country who
Qn
the basis of these rather
•were presenting their arguments
amazin
claims of Federal power,
-constitutional

against

and

financial

the

Treasury's
tax municipal bonds.

Revenue

—

efforts to

the
of

at

that time

TreKasur
Justice

argued

and the Department

*sserted

not

only

the

power to tax the interest on state
be- and municipal bonds, both bonds
come associated with the municioutstanding as well as future ispal market during the last 10 to sues, but also to tax the bonds
15
years
may
not fully realize themselves, and indeed, the very
how great the danger was at that revenues of state agencies.
The
time and how great an effort has
opening gun of this broad attack
been required to defeat the Ad- had come in April 1938 with a
ministration's and the Treasury's message from President Roosevelt
drives to throw down the consti- to the Congress — a Democratic
tutional barrier and to establish Congress by the way—calling for
once and for all the power of the
the immediate enactment of a bill
Federal
Government
to
control taxing future issues of municipal
the financing of our states and bonds.

However,

local
In

those

who

of

1938

effort

to

was

bulwark of the defense

a

assuming direct charge
and
responsibility for the 1954
fight against taxation of housing
bonds and more recently for the
and

ence

difficult and intricate issue

very

that
the

arose

over

the

Company

No discussion of

Income Tax Act.
this

provisions of

Life Insurance

1959

subject with his friends and

mine in the municipal field would

This

the

Attorney

of

the

was

the

attack

power

faced

Department and the Depart¬
created
and to study and
the Taxation of Governmental Se¬
together the« economic and
curities. The Conference on State
legal answers
in the form of
Defense organized the presenta¬
which would be

for the

use

of state and

municipal officials in arguing the
soundness of their cause.
Prin¬

cipally, this consisted of a brief—
Constitutional

"The

Immunity of
Municipal Securities"
signed by the Attorneys General

State

and

1 In

the

announcing

of

organization

the

Conference

forty

Attorneys General
said in part:
ask the cooperation and the sup¬
of the states, municipalities, and of
and
municipal
agencies
.
in

"We
port
state

on

.

attaining
to

State

Defense

the

the

.

objectives herein set forth
the integrity and sov¬

the

end

that

ereignty of the states in this nation may
be

preserved.

vitai
to

to

the

their

No

welfare

and

be

more

prosperity and
of
state

functioning

continued

government in

could

issue

the United States."

This

announcement is

tion of the witnesses for the states

cities

and

this

before

committee.

39

other

La

Epstein, then

Guardia, Henry
General

Solicitor

Chairman

then

and

of

New

of

the

ference

on

State Defense

Justice

of

the

New

York

Con¬

(now

York

a

State

Hart of
the First of Michigan Corporation,
John
Linen,
Morris
Tremaine,
Supreme

Court), Henry

then

Comptroller of the State of
and David M. Wood.
We presented also the testimony
of an overwhelming majority of
the
Attorneys
General, of the
then 48 states, and the statements
New York,

neither

an

offer to sell

nor a

announcement

offer

to

sell

is under

no

circumstances to be

construed

bonds would,

of

municipal law, be unconstitu¬

tional.

we have every confi¬
today's Supreme Court

And

dence jthat

would

hold.

so

validity

of

immunity

solicitation #/

from Federal taxation is indicated

by all recent Supreme Court de¬
cisions in the

field, since the bur¬

such

tax tis

a

the borderline

of

the Court has
The

in

of

Pan-Alaska

tax

a

bond

nicipal

Par

Value

Per

Price 20c per
Copies of the Prospectus
in the Slate in

may

and

local

that

and

government

in

additional

very

with
the

high

todays

financial

communities

per

Share

Share
only

.Copies of the Prospectus may be
States

where

qualified to act as a dealer
the Prospectus may be legally distributed.

the

securities

obtained only in such

may

be legally offered.

CLARK, LANDSTREET & KIRKPATRICK, INC.
Casualty Tower




Nashville 3, Tennessee

Peter M°rgan & COMPANY
149

BROADWAY, NEW YORK 6, N. Y.

the

cases

would

break

interest

costs,

of

many

resources

would

stretched

be

past the breaking point or, in the
case of many revenue bond issues,
the

would

balance

have

been

tipped beyond the point of eco¬
nomic practicability. Cities, coun¬
ties

districts with low

and

credit

ratings or with an unrated credit,
might not be able to borrow at all.
In the language of the Supreme

Court,

therefore,

burden

more

there could be
measurable, real

and direct.

We

also

are

confidence by

confirmed

in

our

the opinions of the

Supreme Court in the Saratoga
Springs decision in 1946.3 Of the
three

surviving judges of that
court, Justices Douglas and Black
dissented

even

from

the

decision

which permitted the Federal Gov¬
ernment to

the

sale

levy
of

bottled water
2 New

York

an

excise tax

Saratoga

on

Springs

by the State of New
v.

United

States,

326

U. S. 572

Continued

Construction

which the Underwriter is

in securities and in which

Life &

$6

in¬

which

the deal and make it impossible to
sell the bonds at all. Particularly

Corporation
Price

to

purposes

many

interest

280,000 Shares
STOCK

are

mu¬

would

rated

solicitation of an offer to buy any of these

Share

be obtained from the Underwriter

Forum

position

state and

interest

BarChris

Corporation
$.1(1

on

interest

the

crease

which

would be necessary to continue to
attract investment money for state

(Par Vdlue $1 per Share)

Co in 111 on Stock

this

authoritative

an

know that

many

in

cases

permitted taxation.

members

ISSUE

COMMON

2,108,521 Shares

measurable

direct, unlike

and

December 10, 1950

December 7, 1959

the
bonds

of

municipal

of

an

NEW ISSUE

continued

The

doctrine

the

The offer is made only by the Prospectus.

as an

offer to buy any of thefe
offering is made only by the Prospectus.

or as a

securities. The

munici¬

state and

on

in my opinion
and, what is much more impor¬
tant, in the opinion of the Port
Authority's General Counsel, its
board counsel, and of many emi¬
nent attorneys skilled in the fiekl

pal

Attorneys

NEW

Means

me sum
up the basic
they were developed
then and as they have remained
unchanged ever since. First, since
I began as a lawyer, let me em¬
phasize that any attempt to tax

of the

This

and

as

torneys
General
of the
General ;when we met that day in WashStates, together
also with ington in June of 1938. The meetthe General Counsel of the Port ing organized a sub-committee to
Authority7 met in Washington to recommend a specific program of
and

Ways

the

govern¬

let

issues

no

Among the witnesses we called to
present our case were Fiorello

securities.

AtStates

the

General of the State of New York

to the President's
in 1938 the Senate had
a
Special Committee on

response

put

and scope

by

In

ment of Justice

materials

Ideal

Sums Up the Basic Issues
Here

of

ana¬

ury

available

the

real

the

message

source

to

and

Committee of the House.

den

immunity of municipals
since, ultimately taking my
place as Secretary of the Confer¬

lyze the arguments of the Treas¬

have

governments.
June

second

ment

and

,,

States I reviewed that fight before

state

He

the

of

of

Defense.

be complete without my tribute
states" but did not shield "the the constitutional fiscal and eco¬
to
his
loyalty, his tremendous
governments states against the * * * supreme
nomic reasons for its existence or
ability, his resourcefulness and a
attack had been beaten back both taxing power of the central govthe
tragic
consequences
of
its
mention
of my own respect and
in Congress and through to the ernment»
in
developing
this
possible loss.
affection for him.
Supreme
Court
of the
United destructive thesis, the Chief

when

give

bankers. presented,

views

the

their securities,

of

vestment

of

organization

on

has

ever

cir¬
cles
and try
to give them the
hope, the encouragement and the
will to make the all-out fight that
government

has been
of

muster

state and local

in

a

Municipal Forum

worked with

Efforts

Early

hundreds
of cities,
counties,
townships and public agencies. A
few months later practically the,
same group of state and munici¬
pal officials, economists and in¬
of

the interest

our

see

municipal offi¬
the country

throughout

brought

of

Securities."

of

and,

state

"The Fiscal

—

Aspects

later, through the
Attorneys General of the States
his retirement (if indeed he ever as amici
curiae, before the courts
entered upon it) to join the Port
which reviewed the Shamberg case
Authority- staff as a consultant and Other related legal actions.
for the express purpose of work¬
Daniel
B.
Goldberg, the Port
ing through the ranks of the Con¬ Authority's Assistant General

Department of Justice had

The

of

third

ments

the

in

entitled

critical effort

cials

Conference

very

Reviews

Municipal

Fo r u m.

gov¬

of the

it

Officials.1

County

ernment.

before

binds

am

friends

denies that the

he

National

the

and

of

Our

Municipal

happy to advise his
municipal market
that John Linen has emerged from
I

personally opposed to use of tax exemption for private industry,
argues

Officers,

As Chairman

an

University, Harley L.

of Mayors, the Municipal
Finance Officers Association, the

ference

of

of

government's proposals which was
published in the form of a report
by the Professor of Public Finance

Economic

Institute

also

extensive analysis of the financial

and

the views
and other public officials; finds that the Life
Company Income Tax Act of 1959 does tax municipals
Treasury honors the exception later made; and though

We

13

and economic consequences of the

and

criticizes the Ways and Means Committee for

States."

the

the

arranged

Council
the Na¬

Governors

tinued

challenging sub-title
Defense of the Con¬
Integrity
of - the
Fiscal

Legal

Lutz

•

'(»

a

as

serve

the

bore

"A

ence,

governments. The writer sums up the current attack on immu¬

nity of tax-exempts;

unless the

ma

to

was

It

as

the

of

function

Governments,

General,

denigrating such an important issue by lumping it with its current

tie

as

the American Municipal As¬
sociation, the'United States Con¬

state

b'T/ s

State

tional

Authority bonds, Mr. Tobin says the real purpose is to do away with
■J

Conference

I served

later years

in

The

Chairman.

of

industrial development, and the Port

State, municipal, housing and

which

Defense

State

associations,

parsistent and recurrent efforts to destroy the immunity of

the

in

;

of
the
40
States, including in¬
cidentally,
Earl
Warren,
then
Attorney General of California.

the

was

catalyst which would bring to¬
gether and coordinate the opposi¬
tion of state and municipal offi¬
cials and of state and municipal

By Austin J. Tobin,* Chairman of the Conference on State Defense
and Executive Director of Tlie Port of New York Authority

■

outcome

organization of the Conference on
Secretary

—Some Current Problems

(2409)

on

page

29

14

xThe Commercial and Financial Chronicle

(2410)

Measures to Sustain

most

of

•

inherited

Concerned
continue

•

-

that

in

requirements

in

more

;

*.

:

present

satisfactory

earnings

bank

will

not

ahead, Dr. Adams questions present liquidity

examining

possibilities

earnings via

of increasing

downward

revision

in

bankers'

economist

(1)

suggests:

r

(2) revising concept

cash; reserves;

"

of

pledged securities behind public deposits;

of

mortgage to savings deposits;-and (4) rescinding taboos against

raising

bank

financing.

capital

In

(3) increasing the ratio

stock

and

criticizes

;

doubts

removal

;

to emanate from the

banks

of

for

tax

not

competing

inequality will

solve

slowing down in the rate of increase in deposit

Wither

banking?

And wherever
whither may be, how can we earn
an occasional dollar and keep out
of
the public doghouse
on
our
way thither?
Or,

what p r o bJems will the

•

banking? And
what
bank

gerial
policies will
be, required to
m an a

stantially from
deposit growth.

rate of
Demand deposits
are
not
costless
to
banks,
of
course.
To obtain them, indeed,
the banks -amust operate an intri¬
cate
bookkeeping
and
clearing

a

bank¬

strong

ing

system

and

healthy,

a

economy?
It

is

da t

Dr.

£.

mechanis

S.

man-

o r

o

quiz shows, and sales of cranberry
sauce. "Growth," has become the
thinking man's byword. ^
In any event, by 1970, it is esti-

posits

receiving

sonal

incomes,

further

paychecks,

even

inflation,

Per-

assuming

will

rise

jn

and

households.

more

And

by the

ing?

Expansion?

how

much

kjnd?

faster

grow

sound

and

Ever since the end of

firms

This

....

rise
one

in

almost

policies

pursued

themselves.

And

particularly
because

lems

always

the

with

this

the

to

of

by

,

..

which

banks

beper-

let

1hpi)l^fV

what

start

us

outlook

for

demand

by

may

deuosits

be

more

a

Future

-Tii

The

*

a.

the
deposits: first
then,
savings

be

course

by

Demand

of cash

demand

the

of

com-

deposits

influenced

of

monetary policies
Reserve. Over t e

years, the Reserve authorities
will
see to it that
deposit growth bears
at
least
roughly parallel relationship to the overall
expansion
of tie
economy.

However, there
ferences

between

are

usual!"

the

rates




<

hof
01

level.

hank

Fiom

improved

;

:

In any event, one

thing is crysJ

sizable

the

rates

and

be

the

paid by some savings
associations, should not

loan

allowed

ceiling

to

continue.

commercial

on

The

rate

banks

was

instituted to safeguard the soundContinued

on

page

•' -

1,500
•„

.

'•.

.

'

;

;

-

'

:'

.

';

BANK

1,200

800

DEBITS
•'

•

•

—Scale

1,050
'•

■'

1'

'■

\

"

5 900

\

0

\\

700

\
600

'

A

Q

^750

5001

to

o

"

.

1
in

jr

600

D

•

pn«fr

400

NATIONAL
'

PRODUCT

MV/^

■'

-

-

'

Scale—0-

450

300*

300 GNP

o
w

■

1

■

•

if
s

140

oi

|

X
'

"

'

DEMAND

•"

'

DEPOSITS

120

—

Scal^^1

-

o

2

200
.

■

to

ioo

Deposits should
■

M

more

^

lso
in

rise

rapidly...
,

Deposits have risen
slower than GNP...

Many

.■

<

,

i

..

»

As turnover

60

1

o

tr

levels off

—

30

■■

in

25

Per

lecause turnover

sales may mean relalarger demands for

been rising

las

much

the

T,

.

^

.

,

.

.

'

■

•

Scale

,

/•hls wouid. obviously have sigHH nan+ imPlicaHons both for de-

boslt turnover

20

DEPOSIT
TURNOVER

case

recent years

o

-

at

V/

15

and

for deposit
~\and also' incidentally,
volume of bank loans to

A

-v S

rate °* increase in velocws e'hwn, the Federal Re-

serve authorities

HJSi lo.pe)rmit
recent

years,

should

be

will-

a faster expansion
nd .deposits than in
particularly if busi-

1
l9*6

1

1

i

i

1950

Data: Bank debits to
demand

i

i

1
1955

1

1

riii
1960

at

tal clear; namely, that the
present
wide differential between the
rates
permitted commercial banks and

(Ratio seal e)

now on, in

I11016 cash than has been
■

expansion

greatly

the Federal

on

farf

Deposits

.

bank

normal

r«:,L
s.hiiiks [act, rising

■

future

mercial

will

-

of

be

..

H h'.? already gone
timnchi.
mn?® ! ?' Can °/f,rd

happen,

livelv
The

use

However, the rate of increase in
*s ahnost sure to slow
down- Turnover has now returned

considering

bank

deposits;

not
•

Ye*oc^y

to

analyze

the

.

bank balances,

prob-

will

banks would
aH.

160

decade> ,^+.seei111s1 n<? unlikely,
some \ additional business firms
economul ml "mwa
S ma;r

apply

faced.
To

general level of interest rates. If,
.ceiling ' is raised, however,
competitive position of many

hear about most is tax in¬

one we

depend
happens to the

upon, what

the

may

with

;i

the

handicaps of commercial banks in
competing for this business. The

.

ahead

years

largely

be
lost by the banks.

familiar

;

1,800

„

So, what will happen to deposit
turnover? It probably could in-

bankers

challenging

all

ceiling rate.'

FUTURE GROWTH OF DEMAND DEPOSITS*

...

_r

reflects

will

are

we

chief

ia*es averaf=e somewhere around
Sie,?j
levels over the, coming

the

We

in

one

„

deposit

of the

cr(rase somewhat more. If interest

formance

plans. If
convincing peo¬
ple that they should do all their
buying without having any money

hither ^ elocity.

vigorous?

be sure, but the difference
'tween mediocre and excellent

credit

may be

to

in¬

Will it become desirable
to raise
this
ceiling?
That will

is esti¬

a

deposits to the extent that
they have over this period,

the

to

some

is

which

This

paying

less than the

losing ground

billion

business

dividends

not.

sav¬

accounts

bank

ing is affected by external factors,

of

substantial

bank management. Bank-

upon

check

for

of

$16

of

or

do

ings. At the moment, this is due
in part to the 3%
ceiling on inter¬
est payments by
commercial banks
but many banks are still

past ten years, then the
be only about $10
billion, less than 17%. The differ¬
of

,

commercial

However,; by far the greatest
disadvantage is the fact that other
institutions pay savers
appreciably
higher rates, of return and
are
thereby able to attract more

increase would

chunk

pay

have to live with.

the

over

any

stockholders, whereas mutual

by ','$26
billion,
However, if they

been

that

rates,

The answers will
depend large-

ly

they have

as

is

must

stitutions

of institution¬
thrift

banks"
by

reasons

profits

remain

increase.

turnover has been

economy as a whole?
How will
banks lend and invest their
funds?
Will they earn sufficient

to

to

interest

bank-

than

enthusiasm

banks succeed

more
economically. This has
been encouraged by various factors, including particularly higher

resources

slower

or

banks

why the Reserve authoriandr what »ties have restricted the growth qf

banking

banks

as

elimina¬

.

Another

continue to lose ground in com¬
peting for this business as rapidly

won

recent

/jncreas^

than 40%:

more

serv¬

the

and

same

Obviously. But

expansion

Will

of

how fast the volume
should be permitted

.

for

mean

•should

to

banks

ence

especially profitable,

are

(and also, incidentally,
the U. S.
Treasury), have been
utilizing their bank balances more

borrowing requirements.
this

merchan¬

for

that their

nowhere

important, relatively

expense.

deciding
deposits

ness

token, there will be a comparable
expansion of business and of its
What will

great

War II,
with only occainterruptions, deposit velocity has been rising rapidly.
Many depositors, especially busi-

there will be many
more
potential
bank
customers
and the public will have
greatly
increased saving power and borpower.

mated.

disadvan¬
figures'

the
is

competitive- problem

maintain their

savings*"it

personal

h

show

World

short,

rowing

at

m

sional

no

about

50%.
In

alized

■;

,

a p p r o a c

1
Incidentally, this raises an in¬
triguing question with respect to

ties, the velocity of money turnover is a major factor to consider

shall have 33 mil-

more people in these United
States, 14 million more men and

women

be

-

.

present proportion

accounts.

To the Federal Reserve authori-

.

lion

10 million

.

promising

their checking account

dise

cling this activity; additional de-

_

we

Would

,'

.

A more

to

real

but
that -it

means.

specific. If, over
decade, commercial

are' able

vary

growing,
aside
from
temporary
slowdowns in steel production, TV

mated that

faster

a

However, this expense does not
directly with the volume of
these deposits but is more affected
by their activity. Therefore, once
the banks have sufficient deposits
to break even on the cost of han-

f
course, to start by talking about
growth. These days everything is
y,

be of major importance

$40 billion of deposits by 1970.
This, in turn, would make a dif¬
ference of around $1V2 billion an¬
nually in the gross earnings of
the banking industry.
Net profits would benefit sub¬

coming dec¬

promote

differ-

these

of de¬

more

coming

.

banks

time certificates and open time

accounts.

Let's be

.

the

a

the

for the coming decade.
paying interest again on de¬
deposits.
This suggestion The Future ' of
Savings Deposits
brings shivers of horror to those
; The outlook for
savings deposits
who
remember
whaf happened
is a completely different
proposi-r
during the 4920s.
Nevertheless
tion.. The main question here is:
we shall probably hear more dis¬
How effectively will commercial
cussion of this possibility.
banks compete for personal sav¬
My own guess is that it will not
ings?
'v- V
happen /However, it would not

ice's more vigorously. With family
to banking. Over-the coming decincomes
rising
rapidly, v banks
ade, for example,- the difference
should be able to persuade a con¬
between a 5% annual growth rate
in demand deposits as against 3%, siderably larger proportion of the
to maintain checking
would make a difference of about population

nobly phrased,

for

and

economy,

ences can

more-

ade hold

y.

growth of demand deposits,apd of
the

Bankers Do?

; What can bankers do to promote
a
larger volume of demand de¬
posits?
One way would be ' to

on

<

things banks

promote growth

course,

of

many persons assume. Its
tion would not solve

ice

likely

velocity and declining bank liquidity.

to

some

This is

tage,

near.as

clear that

deposits, most of the factors
affecting
this
expansion
are
largely beyond their control.. On
balance,, however, these factors
appear to be definitely favorable

surprising to see banks go con¬
siderably further than they have
in competing for short-term funds

and

problem

basic

do

can

seems

equality.

clearly

...

the

banking,

effectively

more

-

.

debenture? /

capital

analyzing rother challenges confronting

author

-

preferred

by

will

mand

'

further

seriously

Thursday, December 10, 1959

start

higher-yielding assets. Thus, to improve banking's

competitive lending ability, the

event, it

while there are

rapid increase in the
supply should be in pros¬

What Can

4_

/

years

acquisition of

'

how

.

mand

'

<

bank,

In any

.

pect.

■.

Bankers Association, New York City

the

the

econ¬

our

omy, a more
money

By Dr. E. Sherman Adams,* Deputy Manager
The American

of

out

squeezed

been

the

.

this tend to slow dc?]wn the growth
the 1 excessive
liquidity •of bank demand deposits—and of
from World War II has bank profits?1

credit.

Banks' Profit Position

in

urgently needs more bank
In other words, now that

ness

.

1

1

1

1965

deposits and deposit turnover figures for 337 reporting centers;
adjusted demand deposits of all commercial
banks. Source: Federal Reserve.

1

10

34

Volume

Number

190

5906

.

.

The Commercial and Financial Chronicle

.

over

Do Rising Int. Rates Cause
Inflation or Deflation?
by taking apart current utterances
Woodwork's analyses

contention that rising interest rates are price

and why

on

*

*

disproving the

inflationary shows why

<
;

.

'

,

again—not necessarily so.
If the
Treasury borrows current savings

rial rise in the rate of interest has

from non-bank lenders

vant

the

The

Bureau

of

to

tight

the

money

time" the achievement of which will keep

our

price inflation to one side and depression to the other without sacri¬

Interest Cost

•

ficing our political and economic liberties.

.

'

of Federal Debt

The second main strand of argument
pertains
to
the
Federal

later, the result budget. Proponents of the proposiggested by the heated contro- would be felt where such infla- sition point out that an increase
v?rsy that took place last summer tionary action is always felt—by
on a debt approaching $300
h regard to
* i
f">:
the consumer. I'm convinced that -billion represents an additional $3
tie! feasibility
things ..have, cphtritmted as^^on, in the Federal budget.,. If
much,to inflation as rising interest "this amount is borrowed annually
o
legislation
rates."1
from the banks it will in a decade
fi raise or reremarks I wish to make

Tie

are

the ceil-

nove

its
obligations,
on

raise

to

tie

Federal

June

sent

ancf

(1) Removal of

ti

savings

of

414%

ijonas,

bonds; (3) Increase

in

p

m

This

message

dreds

of

rise to hun-

gave

testimony and

of

pages

hearings before the Committee on
Ways and Means of the House of
I? OnvAfiAn4r\
4K
13
Representatives, the Banking Committee
of
the
Senate, and the
ff

A

At

limit

to

temporary

a

the

June

raised

was

with

of

end

$285

upper

debt

billion,
limit of

$295

billion;
also
in /mid-September
Congress passed
a
bill
which raised the ceiling rate on
E and H Savings Bonds to 4V\%.
But Congress refused to remove
the 4V4% limit on Treasury obligations of

years' matuthe unremitting ef-

rity—despite
forts

of

five

over

the

President

of

and

Secretary Anderson.
It

would

be

ply.

me

to

all

review

the

important issues, interesting
they are, raised in these heartrigs. But I do wish to discuss one

as

of

them, namely: Is a rise of inrates inflationary or, defla-

terest

tionai'y?

I

am

shuddering
flagrant fallacy

in

general

perhaps be-

bit

-a

I

am

the

from

been

has

that

_

bandied about

—

economist,

an

still

early

'•

fallacies

shudder

me

Cause

v

\

Economic
make

x.do

frequently since

so

by

in high
p.aces.
I refer to the proposition
that
rising interest rates cause
summer

men

commodity price inflation.
My chief purpose is to let some
sunlight in on this fallacy, and
tiereby to prove its absurdity.
I
should also like to emphasize the
Iragedy that will confront our
nation
if
this
fallacy
becomes

videly accepted and is
Public policies.
Let
cf

of

(1)
£

me

quote

a

woven

in high offices as
this current fallacy.

By

a

candidate

leading
for

into

few statements

people

Pies

More

The Argument That Rising

.

sam-

and

Senator,

"The

President:

specifically, what are the
arguments in support of the contention that a rise of interest rates

(bvious

this
rates

move

up

would

and

it

But

is

affect

is inflationary?
Fir J,
the point is made that
interest, like wages, is a cost of
production; hence when the cost
of borrowed money rises, selling

down

the

to

L^idon B. Johnson in
coripti-tuents.




a

leaf-

the

interaction

supply.

must also rise if normal
margins are to be maintained.
While there is a logical

profit
basis

contention

this

for

the

cost-push

individuals, and governments de¬
mand

loan

finance

to

money

savings normally provide most of
the supply, but the banking sys¬

ilo

vear

To

$76 billion of maturing debt would
have to be refunded

on

a

1% high-

Basils
at a_cosVof"$760 million,
carrvine charge
the rest
on

cyclical decline.

a

Second, the assumption is made

.

tiiat

the

item

in

additional
the

budget

interest

is

cost

borrowed

by the Treasury. This is not necessarily the case at all.
What
actually takes place is mainly a
question of over-all fiscal policy.
-r

/»

If

j

■»

v

__

_

t

•

general policy calls for a
balanced budget, the new interest
item should take its place with all
budget

budget'

can

increasing

items,

still
tax

be

balanced

a

realized

revenues,

by

by
re¬

bination of

the two.

in

general

inelastic
of rate
js that any increase in in¬ variations, there is a fringe of
terest on the Federal debt that marginal borrowers who are quite
arises from a tight-money policy sensitive to rate changes.
They
is
picayune compared with the are predominately
composed of
huge expansion in money that businesses and individuals that,
would take place under constant make large use of borrowed capi¬
easy money conditions.
tal—notably residential and other
A

final, though less important,

strand
rates

the

of

the

on

is based
interest

argument

observation

that

and

commodity 'prices fre¬
quently rise together during the
prosperity stage of the business
cycle, as in 1956-1957. From this
it

is

concluded
causes tne

that

rise

the

relatively

usual

range

The

truth

prices

is

justified than

that both

sometimes

rates

and

upward
together at this stage of the cycle
in response to general prosperity.

Expanding
and

sumers

move

expenditures
businesses

expanding

of

bid

demands

construction, state and local gov¬
ernments. and public utilities.
On
the other

con¬

prices

hand, when loan

available ;at

is

tends : to

be

low

tion, the actual cost impact of
higher rates on prices is negligible.
\ A few statistics in regard to the

and

interest

Another

aspect

of

rates

on

tion

can

be

The best illustra¬

drawn from the bond

market.

In April, 1958 at the low
point of interest rates the price of

U.

S.

1983

Treasury 3V4S maturing in
103, giving a yield of
By September, 1959, the

was

3,1%.

loan

price of this issue had declined to

85V2, affording a yield of 4.2%.Thus, a rise of 1.1% in yield was
accompanied by a price decline of

correlation between
and

for

interest rates

prices

is actually an inverse
one, (instead of direct) obtained
by lagging the price series be¬

17Vi

points.

order

other loans.

and 18 months.
That is,
credit conditions encourage,
are
a
precursor
of, cyclical
recovery of production and prices;

concomitant

tight

income.

credit

degree

conditions

restrain

and

prices, and
harbinger of

a

are

to

.

cyclical

to

the

make

Orthodox

View

of

real

loss

bonds

on

reduction

Consider also

economists

rate

money

price for the

use

Just like other

relatively

free

of

look upon

interest

as

a

of mopey capital.

things traded in
the

market,

property

a

a

whose

paid uses from 4% to

1%

Even

of

value

would

($5,000/.06).

rate

decline

Hence,
Continued

made only by the Prospectus.

$15,000,000

Price 99^2%

Plus accrued interest from December 1, 1959

...

receipts.
im-

total
.

.

$7,500,000

the cost

overstates

this

,,

,

,,

portance of interest since the bulk
of outstanding debt does not ma-.
ture each year; hence, a rise m the
market rate affects currently only
a fraction of debt contracts, and
^he °^or-all cost effect on prices
As i},e^
The objection may be raised
that use of the over-all interest
c?s*
business submerges th
eff^t on particular industrieslhat
make laige use of borrowed cap 1Price mflation is an
,

-

,

•

2

Wright

•

,

Patman,

Congressman, State
before the Committee

Ways

Price 100%
Plus accrued interest from December 1, 1959

Copies of the Prospectus may be obtained from the undersigned, and the
other underwriters, onlv in states in which they are qualified to act as
dealers in securities and in tohich the

F. Eiierstadt & Co.

225.
Abstract

3 Statistical

drawn
nue,

1958,
from

p.

the

ef

the

These

492.

Bureau

of

Statistics of Income.

United

data

due 1979

(Convertible into Common Stock until December 1, 1969)

A

and Means, House cf Repre¬
sentatives, 86th Congress, First Session,

p.

5% Capital Notes

<

are?

Internal Reve¬

December 9, 1959

Prospectus

may

the

current'

us

assume

rental

in¬

is

This would amount to about
of

in

Let

net

Assume, therefore, that/the

one-half

6%.

and

simplified illus-

5l/2% Senior Notes due 1979
.

and

$5,000. When the prevail-'
mg yield on such a property is
5%, the value would be in the
vicinity of 8100,000.
But if the
prevailing yield rises to 6%, the
come

Commodity Prices
Orthodox

estate

tion drawn from the field of com¬

a

Relation

consequence,

They did not want to

mercial real estate.

Between Interest Rates and

the

take

a

decline.

a

insurance companies, and
other
lending institutions
were
very reluctant
to sell bonds in

tween 12

business

As

banks,

easy
and

cost, however, is not rele¬

average rate

loan

the valuation of income-

bearing assets.

the cost effect of a rise in interest

rates.

the

market is the important
influence of changes in interest

money

James Talcott, Inc.

vant to this issue since it concerns

busi¬

govern¬

together with Federal Re¬
serve pressure on supply leads to
higher rates. The closest cyclical

up;

money

This offering is

about 1% of total receipts from
.sales of goods and services. Total

more

ments.

NEW ISSUES

relative importance of interest as
a cost will give perspective to this
issue.
During the postwar years
the amount of interest paid by all
active business corporations was

money-

rates,
by

borrowed

individuals,

nesses,

of

rise of prices. This

more

no

the

is the opposite one—that the rise
of prices causes the rise of rates.

._11_

the

is

within

part

as

in¬

vestment and consumption expen¬
ditures. /Personal, and
business

of infla¬

theory

of

Businesses, '

prices

States,
1 Senator

one

ducing exoe^ditures, or by a com¬

on

securities.

anv

nrntof the

use tlscal 1960 as an example, the

other

More

of Texas—Hearings

sent

higher

and

/iaav*

government

Pt

sup-

money

spending

Administration wants to increase
Hie
interest
rates
on
long-term

interest

the

increases

prices follovy.
If the administration doesn't get interest rates back
down to normal; the 50-cent dollar
La ttmnlh
OA
will soon be worth 30 cents.'

of

impossible and in¬

appropriate for

in

n,,r

maturity^at

Interest times Are inflationary

the

,

,

iho

general,
but 0f the debt would not rise until
this tight money business is one.
which time the marof the reasons why the cost of ket-rate
may well have recorded

Joint Economic Committee of the

Congress.

,

va

The

This

:

■

argu

nlaiSi

e?

in

national debt and the

•

e

in

,

large

i

Amotions they
thev fail to
±aii t0
Uvct I wlp lif J
t s ^a
1J jntere^ effects the

p.

from $283 billion to iivjng js going up. The Treasury
i^ni+r tnS
to boiTOW more to meet hiSher
temporary debt .limit
to $295 has
interest costs.
o

Jc

f

3 for
F°ns®£vatj,Ye
R®Pub" er
the
Eisenhower

Administration

the

disarminelv
i

^ ofserv^Lconl

,-7JA

the(

given

as

aoDears

,

i

-

a

and

truth

inference is

assUm|tions

^nt
t

1

nast "2

the

(3) By the president of

lie

Treasury

of

issues

new

(Z)

interest rate ceil-

in

tions underlying the second argu¬
ment cuts it down to size. rThe

rates

,

Administration

}

Savings' Bonds"6 (2)"^Re- V-3"15--!!1
jlcarL;

ana

on

■«"»»-

It is all caused by

have

oc WP
as
we

money sup-

of

high interest, and if you increase
it again, again we will be called
upon to
increase the debt limit,
.1•j.icf
st

moval

mg

Wood worth

waiter

*_«.

Con¬
requesting:

gress
E
h

mes¬

a

House

have had to get a debt

not

limit increase.

to

,

"he

Eisenhower

would

President

sage

add $3° billion to the

influential and lone-

member

the

On

1959,

8,

,

words, if the interest rate had not
been increased since Jan. 20, 1953,

aid

ctebt limit.

an

or

Representatives: "The only infla-.
tion we have today is inflation
caused by high interest.
In other

ernment could
pay

Bv

time

Gov¬

federal

Sooner

(Z)

iig on interest
rites that the

tie

line.

indivi¬

—

demand

cost

marginal influences
on the levels
of
employment and general business
activity.

*

there should be careful coordination of fiscal-monetary-debt

challenges of

therefore, is not really germane to
the question.
To be sure, a mate¬

of

from

emerges

15

impacts,
ranging duals, pension trust funds, life tem may also augment supply by
frlom
negligible to appreciable. insurance companies, mutual sav¬ loans of new money to borrowers.
But this is a question of distribu¬
ings banks, businesses, and so on If the price for loan money rises,
tion of
tlfriEf price effects; not of —no new money is created. The less will be borrowed, just as less
the over-all change in the value
Treasury securities are purchased of a commodity or service will
of the dollar.
As I shall show by transfer of
be bought when-the price rises.
existing money.
later, a rise of rates is most rele¬
Thus, examination of assump¬ While the demand for loan money

management control. The latter is termed "one of. the greatest eco¬
nomic

assumption is that the
borrows the added in¬

terest item from the

banking sys¬
tem, thereby creating ii£w money.
This may very well occur, but

Index

of Labor Statistics.

tures, why check-reins employed by the Federal Reserve are needed,

,

final

Treasury

objection,

Price

sale

varying

tight money acts to restrain price inflation and investment expendiu

A

typically

the Whole¬

or

'

subject voiced in the hall of Congress and elsewhere which he

finds to be invalid. Professor

conception,

by the rise in the Con¬

Price Index

sumers

.

Finance economist answers this

all

-

measured

By G. Walter Wood worth,* Professor of Finance, University of
Illinois, Urbana, III.

the

(2411)

legally he distributed.

White. Weld & Co.

to

an
on

$83,333
investor
page

24.

16

(2412)

the

The

mechanics

or

reduction, that:

(1) if would

much money; and (3)

misuse of capital;
the

would

be

shows additional tax

most

inequitable;
and

It

\

on

the

and asks effect
not be

consumer

lengthy discussion of these
and mis-statements, but in
public interest some way must
be found to bring a sense of ac¬
curacy and
responsibility to the
depletion opponents. The Novem¬
ber
hearings of the Ways and

v

a

the

"break-even point"

on

ignored.

fuel,

sources

that

mineral

are

re¬

important, so basic,
policy cannot,

so

must not, be based

on

going

further let
mention

ment

me

these
*

some

tax

to

p

1

a

and

de-

t i

e

out

in

ex¬

would

be tuftleashed

of

cause

self

-

preservation

be

can

little

of

transfers

No U. S. wells

erage.

are

ment

About 62% of crude oil produc¬
tion is shared
by 32 companies

producing

that much.
What

if

whose ownership is in

he

were

debating the

farm problem and
gave an exam¬
ple of a cow with such exagger¬
ated producing
capacity? How sci¬
entific a farm program could we

expect from such thinking?

•

to this booklet

sound

down

principles
furnish

public

saying, "The

he

there

laid

foundation

a

88%

?nS+v°fuPeople'
The other
m the hands of thousands

is

more

porations

and

individual
sound like

businesses

Tl,^nd ^

average 19 times the cost of
the wells."

Let's

do

some

well produces

much

as

be

as

better

the

it

its

over

$500,000

than

maximum

tion

arithmetic.

an

If

m'ght

come

entire life

percentage

cost of the

well)

deple¬

possibly get would
If this is 19 times the

well, then a well would
$7,230. You know the

cost around

fact is that costs
times this.
And

«

the

its

run

many, many
fact is that

the

income

from

for

replacing, finding
oping new reserves.

crude

and

oil

devel¬

Another mistaken
charge is like

the

one on
page 15823 of the Con¬
gressional Record: "Oil
production
is the only

industry which grants
charge-off for intangible
costs,
plus depletion allowance."
a

The fact is that all
comparable
costs, all costs of getting out the
mineral or timber or
other re¬
source, are allowed for all these

industries.

On

drilling costs
and

are

costs

are

the

not

drilling costs(

step, usually the
and

not

be

hand, if
allowed, oil

industry where

traction

These

the other

would

gas

source

most

extraction,

elists

only

re¬

all the

ex¬

recognized.

are only

returns

who had

or

Monopoly Would

producing

Result

Without It
Then there
on

are

arguments based

charges of monopoly.
However,
know
of no

major industry that




charged

or

pan¬

been

who

line

of

attack

is

parison^nf .-tables showing com-

Ss0°" of income taxes and remni! earnings
ofcritics
selected
companies.
Here
show
our

effort

whatsoever

no

to

the

yrt*>
?T
lnt° the ec°"

stand'it ^

nomfc

analyze

realities.

ta^- the rat,io

of income

Based

No

their
of

accord

ers

pe¬
ap¬

applying in other segments of the
American economy." '
^
V
Unable

to

there

score

their

in

tnat

and

of

the

capital.
results

They
in

a

tax
allo¬

or

claimed

of mineral

misalloca¬

of

tion

capital, an excessive
waste of, capital.

or

use

approved
Parts

The opponents advocated elimi¬
of the present

nation

provisions,

the

easy

everything

much

the

of

these costs

fluctuations

,
and
offset agamst hoped-for future
production. It is only because the
industry is continually increasing

its expenditures
he

to

keep

increasing demand

be

all

somehow

taken

care
of
by what they
price mechanism. r This
admit, would result in less

call

Chicago.

puces, and greater dependence
foreign oil and minerals.
How could we have a

on

shares

uD

and

$1.3

stock

and

million in

produces

pay¬

cash

the assets of United Parts.

for

Echlin

automatic

ignition' re¬
placement parts. United Parts will
be

operated

the

as

brake

parts

41V196on °f Echlin' beSmning Jan.
The

Ilousatonic

Public

Service

a

more

we

equally

would

for

have

than
less

minerals

we

and

industry."
primarily to

°^f5Tfive Proceeds
rights offering to
from

the

If
mm"114-?.8
,t0 used
aPProximately
$1,750,000
will be
to repay
75n

bank

loans

of

construction

$1,100,000 and

for

expenditures.

The

Directors of Roger Corpo¬

raturn of
15

Rogers
have declared
dmdend

stock

4%

to

payable

stockholders

of record

a

Dec.

f.
paid a 3% stock
dividendcompany
September. In March
was

split seven-for-one
v

Inc.

has announced it will

the

quire

Pond's,

-

more

a

pay,fo.r Jt. by
And

misinterpret. "° SUCh Statistics t0
countin«eirentllmitati°ns
of ac¬
counting for
That is whw
income.

iin!tPf-1SOns with taxe^ and refnstanpp1C°me
misIeading. Fora
instance, as weare
produce from
it with
Ss Property, probably less
thiL
.?• and with higher costs
this

through

coast-to-coast

Exchange

New

member

firm.
Mr. Sears
in

in

joined Paine, Webber

and is

1946

presently the Man¬

cf the brokerage department

the

Boston

office,

24

Federal

Mr.

Wright commenced his

em¬

with Paine, Webber in
having worked seve'/i
years for California banks in the
capacity of security analyst and
trust
advisor.
Presently, he is
Manager of the sales department
in
the
Los
Angeles office," 626
South Spring Street.
ployment
1955

after

Francis Broderick

Opens

Eye Cosmetics
Mauvel, Ltd., through

Aziza

Division of

1319

with
ment

Bankers

of America, Inc.

products,

mascara

and

eye

shadow, will be

MafnhdiHn? Chesebrough's
Prince
operations.
The

Matchabelli

ac¬

the

third

by Chese-

& t~hPe°ndrS
in f0Ur
the
Company
and

bought
from

in
at
F St., N. W. He was formerly
Whitney & Co. and Invest¬
business, specializing
funds,
from
offices

mutual

gen °£. St°Ck'
The
which include

MneeXff
line
of

Seeck

WASHINGTON, D. C. — Francis
Broderick is engaging in a securi¬

Kade

Prince

Vick

^ars.

In

purchased

and

in

1958

Matchabelli, Inc

Chemical.

Joins

Fahey, Clark

(Special to The Financial

CLEVELAND,

Chponicle)

Ohio—Howard H.

Peters has become connected

with

Fahey, Clark & Co., Union Com¬
merce
Building, members of the
Midwest Stock Exchange.

'

May Adds to Staff
Foui

HU2K

weather

high speed
nil
helicopters built by Ka-

hpCFaftCoiT°ration, Bloomby the
development

Lkld
field,
have been ordered
Navy this year for
test purposes,

(Special to The Financial

PORTLAND,

Oreg.

Chronicle)
—

John R.

Manning has been added to the
staff of May & Co., 618 Southwest
Yamhill

Street.

Another 12 will be

?960
1ViSedevaluation
bT t+he Navy
in fisCal
I960 for
and test.
Ka-

scheduled to replace utility heli¬

With Scott,

Bancroft ;

(Special to The Financial

Chronicle)

Calif.—Joseph
W. Teter has become connected
with Scott, Bancroft Sc Co., 235

•SAN FRANCISCO,

Montgomery Street.

be

willing to
of a higher

on

be

the

same

"It

cheaper for the
economy simply to buy

whatever

extra

the

market."

world

page*

mu<*

oil

it

desired

in

fo^tni?
"°Ur tax expansion
laws also
foster f!hen:
the uneconomic
of mineral
production."

tnF°7ti-nuing
in, an appendix, on
claim and theory that canital

the

one

the

Stock

price."

rest of the

SSfiSi

ways

of

ner

York

ties

of

oil.

wants

economy

oil, it should

I960, accord¬

Lloyd W. Mason, executive part¬

ac-

inc

the

1.

in

the stock

is

of

Jan.

announcement made by

an

Dec

a

rest

effective

tis

ing to

Francis P. Sears, Jr.

Webber, Jackson & Cur¬

ex¬

smaller minerals
He
referred

the

of Paine,

Street.

stockholders.

mem-

panel
said:
"If
We
were to revise our
taxing of cor¬
porate income so as to treat all

Donald M. Wright

ager

7r°San,y
of Derby recently sold
76,642 shares of common stock on

Means

market

results®

of

ment

Echlin

Then the opponents'

f'

spokesman, who is

ploration

United

.

fer

wt'y or°anothePertyi
anethf another replace

of

laob

poorer
climate for economic
growth?
Look at the record before that

now,

...

an

development, and less oil, higher quisition is

industries

the

The merger agreement
exchange of 74 720

for

calls

the

they

of

nlrS ls,.exPected to go into full
And in
statement prepared for
fiscal iS °a Me helic°Pter in
5
n.il ? ',, d tJavy
spokesman
inassuming
a change
s indicated that since the HU2K
the depletion
tTeed in
law, he said: "If

OCCULTAthat this differential
dustrv
1
were a static in¬

ordinarily

general partners

stockhold¬

with

merger

a

that

assurance

would

do

out

become

Manufacturing Company of

Clinton

its

en¬

accounts

to

turing-Company of Branford have

*

UfhS
f°rratios
d,r,lling
and be
<*Plothese
would
tirely different.
The differing]
wTe?hearb0Ut
b1GCaUSe
tbe industry!
whether
wisely
or not, defers in

ration
lation,

iron

' vited

of record Dec. 15.

Chesebroush

What the Opponents Admit

with

date

to

,

revolved

neutral
use

tax treatment

our

industries

of,

It

theoretical

treatment,

that

on

effective

amendment

central theme

was one

criticism.

a

cation

challenge

l °L the Present House Ways
and

0

outstanding

Stockholders of Echlin Manufac¬

a

closely with that

the

after

charter

industry

on

to

pears

chief

cas

oil

stated, "the rate
capital, from the
troleum industry as a whole,

account for half this group's

another

the

spokesman

return

shows
net
of these operators

fST™^"ssoufrdl&e
Still

that

makes too much money.

(1955)

one

important
expensive step, in the

mining,

surprise

,osses (1956) and that the
Treasury s summary of individual
ax

the

for

the authorized common stock from:

recent

appointed to
challenge vigorously the percent¬
age depletion law.
Their job was

t™-,

most

process.

I

a

"le comPanies

industry spends about 60% of
gross

'

as

P.
Sears,
Jr.,
Boston
Mass., and Donald M. Wright, Lbs
Angeles,-. Calif., have been in¬

good

a

around

would
study the
published fig!

had'net'f13' 531°,

could

be $137,500.

in

a

(this would

average

engaged

latest

fact, losses for 37%

ances

19 900

monopoly?

Treasury's

understanding."

competent authorities tell us that
recovery value of depletion allow¬

than

more

a?d,.,gas Pr°duction. Does this

^

for

Another kind of exaggeration is
the one which
appeared in the
Congressional Record of Aug.
27,
this year: "As a matter of

the hands

l!
?r0ducers'than
Treasury sta¬
tistics show
5,500 cor¬

.•«

The distressing
thing about.it is
that another Senator wrote a foreword

say

oil

av¬

Francis

past. We should
500,000 $1 par shares to 2,000 000 ;
preview from" what
no par shares.
This will pave'the
was written and said at the hear¬
ing
four years ago before the way for a .100% stock dividend'"
which would be paid one-. weekJoint
Economic., Committee,
of

get

"lng 3n increase in tax

tor's example is 330 times the

regis¬
its

of

attack

this, and his state¬
applies equally to mines and
properties: "By abolishing per¬ to muster the strongest arguments
centage depletion allowances and they could.
thereby
forcing
the
successful
10 years." The reader is
cr^cs
the law recognize
expected - mine owner to sell out in order
that
to imply that this
depletion occurs, but chal¬
may be a typical
to take advantage of
capital gains
lenge the formula which has been
situation.
But
the average well
rates, the effect would be to pro¬
in
the law for 33 years, and the
in
the
U.
S.
produces, instead, mote monopoly through the oper¬
about 14 barrels a
day, and for ation of the tax laws, rather than corresponding discovery value
formula which preceded it.
365 days at $3 a
barrel, this is
about $15,000 a year. The Sena¬
It
was
enues
revnot, and
cannot
be,
Stanley
Senator starts
his analysis of depletion with this
sentence: ''Suppose the well pro¬
duces $5,000,000 of oil for each of

for

shares

The stock will be

stock.

exchanged

the

in

new

157,500

by .the .depletion' „°,c.
GriP Nut Corporation.
Heli-Coil stockholders will, meet
opponents, and there must be con-1
Dec. 15, to approve an increase in
sistency with their basic conclu-<
line

of

dustry will

Lowell

of

;

Admit Two

.

wholesale

.

The panelist for the coal in¬

v

a

tration
common

There

Commission

Exchange

great confi¬

witnesses

copyrighted

booklet

sift

will

have

u r a 1
Resources
Development."
things, voluntarily or not This
study was intended to pre¬
monopoly would begin to become sent all
possible
viewpoints.
There
a
reality.
were three able

ture

In

o n.

I

errors.

dence in the members of the Com¬

corporate realignments, with
Congress.
There
an
exhaustive
properties tending to go to those
review was devoted to the "Im¬
having most ready access to the
pact of Federal Taxation on Natcapital markets. By the very na¬

exaggerate
Come

exhausted

and

percentage
depletion
in-

economic

liquidations and sell-outs.

law

would

for

oil

values

forces

cause

The

the

provision

both

of

nomic

oppo¬

of

of

this rwould not be so.
Because without it,: powerful eco¬
si011s of the

errors.

The

degree

traction,

examples of

nents

lower

a

treatment we have to recognize
depletion and provide for replace¬

Be-

error.

has

tO
Ileli-Coil Corporation, Danbury
with the Securities and

has filed

concentration, but without the tax mittee.

national

our

fore

©ther

and

Committee

Means
these

Our

basis which would

a

errors

would not ensue;

revenue

an

is not my purpose to under-,

take

compromise and to reduce it further

a

development in the field copters now operating with the
packaging machines has been fleet, the eventual quantity or¬
announced. The significant feature dered might amount to
some 250
of these machines is their ability helicopters.
The HU2K, which is
to cold fold oriented polystyrene now undergoing flight test
at Ra¬
sheets into semirigid trays with¬ man's plant, was developed under
out using heat, adhesives or scor¬ a contract it won several
years
ing.
The polystyrene sheets used ago to provide the Navy with
ja
in this new method are produced
faster, longer range helicopter for
by Plax Corporation, a subsidiary search and rescue at sea.
of Emhart Manufacturing, Hart¬
ford, and Monsanto Chemical Co.
new

of

national interest.

(2) the industry is not making too

thejtational security aspect is vital. The author

existing rate Is

taxed

be

charges depletion opponents with jumping to the wrong conclusion
about our over-supply; denies there is misallocation of resources or
states

A

destroy capital resources of the
industry, to the detriment of the

less exploration, less develop¬

mean

may

none

sense,

deple¬
tion, such phantom profit would

new arguments raised
against tax depletion allowance for
Stanley presents critics' admission, regarding its elimination

ment, less oil and higher prices;

Thursday, December 10, 1959

.

of

Without percentage

exist.

Oil economist and producer lays open economic unrealities of
previ¬
and

.

the

economic

an

ous

in

systems,

Calif.

,

.

our
accounting
recording of a
profit, when in reality, and from

Depletion Issue Today

By Lowell Stanley,* Graduate Economist,t Beverly Hills,

oil. Mr.

Chronicle

The Commercial and Financial

misallocated to resource devel¬
opment, his paper said: ".
esti¬
mates lead to fhe conclusion
that
is

.

Continued

on

.

page

36

Primary Markets Jn

V

I CHAS.W. SCRANTON&CO.

'CONNECTICUT
New Haven

SECURITIES
New

York—REctor 2-9311

Hartford—JAckson

7-2669

Teletype NH 194

Volume

190

Number 5906

.

The Commercial and Financial Chronicle

.

.

(2413)

THE MARKET
BY

.

start to show drastic

improve¬ in anticipation of some good
of in¬ earnings news. Projections of
tegrating new acquisitions at results for the current fiscal
least temporarily at an end.
year along with its big stake

AND YOU

...

ment with the

WALLACE STREETE

*

*

■*■■■

seem

in

to be the

with

only
from the

V.'0

\

...,

..

making in growth in sales in
etc.
T
plastics. It has

Splits and Dividends Versus
Tax Selling
> V%:;

I?

.

chemicals and
been

at

stock with

A

longer-range
background average yield of 5 % and hold¬
promise might be Link Belt
yas encouraging and year- ing at less than 12-times earn¬
where the dividend had to be
ehd dividends and stock splits ings despite a long dividend
cut and the stock sagged dis¬
vere arriving in profusion to record and a strong financial
tolster the market's action. position to illustrate the neg¬ piritedly, although the mate¬
rials handling business is in
Vhether all of the tax selling lect accorded the issue.
the forefront o!f any plant ex¬
lad
been
cleaned
up
was
Papers and packaging; items pansion to cut labor costs via
rioot, although in selected is¬
T h e .company
haven't had much following automation.
sues where better action came
seemed to have made its turn,
vith a rush the presumption recently, and while an issue
but
then
bumped into the
is that the selling here has like Oxford Paper shows only
steel strike so that estimates
abated. Despite the chances of about an average" yield, the
of this year's results are gen¬
more
selling-, lurking around fact that it is off more than
erally on a par with last year,
a
and
quarter
from
the
1959
top
awaiting better prices,
which were far from dramat¬
the
general expectation i s and nearly half from the 1956
ic.
However, with a strong
that it will be absorbed easily. peak still makes it a candi¬
date for improvement. In fact, upturn in operations in 1960,
the sharp contrast could show
As
is
the
custom
in the expansion
in the last five
up and make the issue a can¬
years
cost
as
much
per
share
year's final month, the mar¬
didate at least for a restora¬
kets were broad and trading as the recent market price
tion of the 75-cent quarterly
is
active. For broad markets the which
ignoring the im¬
dividend in effect prior to the
comparison stretched back to proved plant rather pointedly.
;

The

business

January and for better
day gains the comparison
back

November

to

That looked far
start

of

the

of

more

one-

was
1957.

like the

traditional

cut

year-

rally than

any new

flood

In part,

showing

the neglect can be
a
poor * earnings
on the surface for

the first

nine

traced

to

section

after

session

this is both
stock

candidate for

a

split

and

at

the return

average

seems

to

recent

be

the

4%

is

of

*•»

that

'

%

sjs

if

were

able tp perk up,

mostly

laggard

*

*

*

if

-Diamond

With the industrial average

relatively

a

lofty

standing, the hunt for issues

another

was

consideration.

is

candidate for

a

a

half

of

its

holders and is in

old

the

*

*

ident

Mr.

better;

dent, has been
associated
with
Evan V.

Shierling

Borden

and

Beatrice

—

has

deliberate program

a

of

downgrading its reliance
on
low-margin dairy items
and boosting the proportion of
high-margin, specialty foods
it handles. Where butter
accounted for
two

once

fourth of sales

a

if is less than
10% currently. The egg and
poultry line was shaded down
years ago,

from 7%

judging
appear

to 2%

The program,

.

in

1954.

article

necessarily at any time coin¬
with those of the "Chronicle."

not

cide

They

presented

are

as

those of

He

Diamond

an

and

Canada

General Fund, since
formerly was associated
Moody's Investors Service.
He

1942.

with
He

also

is

.Vice-President

a

North American

Some

other

and

the

Other members
General

Fund

of

the

L.

ert

Osgood,

Maxwell
Bruce

C.

Edward

G.

centers,

well

do

on

were

Expanding Match Company
Diamond

promise

itself

has

been

Burnham Partner
William

P.

Stern

will be admitted to
Burnham and

the

as

profit^
but it
Line comprising some
did, in acquiring U. S. Print¬
quarter million acres in key
ing & Lithograph, pick up a
areas
were
largely ignored. new chief executive William
a bit of trouble
wise in its integration,

although holdings of Atlaptic having

Coast

So

>

(Special to The Financial Chronicle)

ROCKFORD, 111.
Courcy

—

added

been

has

Verne E. De

Exchange.

to

Rockford

members

SAN

the

R.

Exchange.

Midwest

&

Stock

FRANCISCO, Calif.

Foley

are

Building,

Trust

the

of

Wal&ton Adds Two

(Special to The Financial Chronicle) '

of Robert G. Lewis & Com¬

staff

an

now

Co.,

and

James

affiliated

Inc.,

toward

a

study

merger

looking

with

Sea¬

H.

Walters, plus

that has shown

board Air Line, which should
creasing
be

completed early next

Shares

C.

with

nor

a

solicitation of

offer to buy

an

'

of these

any

the Offering Circular.

\

*

V

per

of

Coast

held in about

a

while

of

those

only in

may

4

,

j

•

d "

Share)

Line

constantly in¬

earnings.

In

ing

merger

is

only

12-point range months old—there is
Seaboard




chance that Diamond

■

.

Pierce, Carrison, Wulbern, Inc.

Aetna Securities Corporation

other

Nolting, Nichol & O'Donnell Inc.

year. words—since the U. S. Print¬

have

three
a

good

can now

legally distributed.

Roman & Johnson

company

a

be obtained from the undersigned or other
which such dealers or brokers are so

States in

qualified to act, and in which the Offering Circular may be

December 9, 1959

—

John

Graziani
Walston

265 ; Montgomery

Street."

<

offer to sell

Copies of the Offering Circular
brokers

1

Company, 15 Broad

Price $2.00 per share

or

Jan.

Street, members of the New York
Stock

/

the

was

of

partnership in

Robert Lewis Adds

(Par Value $.10

dealers

Ryan,
A.

and

William Stern

big

boom

to

F.

Meighen

COMMON STOCK

im¬

Com¬

Matthews.

names

an

Canada

Investment

mittee include: Mr. Shelley, Rob¬

Corp.,
is

is

company

of

Fund of -Canada

Limited.

100,000 SHARES

record

been

Manage¬
Company, in¬

NEW ISSUE

dividend

unbroken

was

has

Boston

ment and Research

Match,

of the famous old

one

with

Fund

it

vestment adviser to Boston Fund

by earnings, .would
to be a successful one.

[The views expressed in this
do

Canada

General

associated .with

been in

Shierling,

Vice-Presi¬

a

organized

Ranking well below the
dairy giants—National Dairy

the

fund.

since
t'f

F.

of

mutual

earnings uptrend.
j|t

by

$90 million

■

National

been

Shelley, Pres¬

earnings, to
pronounced

a

securities. The offering is made only by

companies with land holdings portant/packaging producer,
printer and lumber dealer.
in
Florida
where
the

able

has

William

tiny of some of the market
analysts. It is an item with a
yield approaching 4"%, but

Thts announcement is neither

spanning 70 years that
that offer a minimum of
only lately has started stir¬
downside risk made some of
ring. Today the match busi¬
the
quality rails a natural for ness is down to 15% of sales

realty

commit¬

tee

''

food company under the scru¬

pany,

stocks

.

V.

announced

Beatrice Foods

discounting the

Gaining Popularity

Evan

Shierling to

dividend

a

to

appointment

a

an

food

Long

Committee

boost.

which

trials of the company.

Foods

Executive

Investment Committee and the

an

without

hopeful sign.

at

Even

above

year

production to mitigate the
seeming retrogression. And
a
setback. By
contrast last with' a strong improvement
month the group lagged re¬ next
year extremely likely,
peatedly even while the in¬ the stock hovering near its
dustrial average was march¬ five-year low and selling at a
ing to recovery peaks. So it is substantial discount from
something of a turn-about book value is not one of the
and, as such
a
moderately overvalued situations around.

again

Limited

able to inch ahead

was

session

rate

current

months of this

look

of tax

cents.

BOSTON, Mass.—The reconstitution of the Canada General Fund

so

author only. I

against last. But the out¬
for the full year antici¬
selling.
pates covering the dividend
Rails Still Neglected
requirement by a good mar¬
While the rail s u p p o r t
gin, and the dreary compari¬
wasn't o verly enthusiastic, son is due to start-up expenses
this seesawing and
laggard of bringing new lines into

end

60

to

are

glowing that to some of the
brokerage firms,

than

above-

an

European Common

payout since it distributes less-

-

available

Names Shierling

services and

decade, also

a

inroads it has been

the

Market of H. J. Heinz

paramount issue for most of
luke- haven't yet wandered over a
the market followers. Despite
varm
span
of
as
much
as
10
help
rails,
points.
the fact that the yield in Min¬
ontinued to drive toward
A Feed Company
nesota Mining is a fractional
tieir all-time peak with the
Branches Out
one, that doesn't prevent the
onsensus in Wall Street fairAnother narrow-moving stock from being one of the
\r confident that a reading
item all year has been Archer- wide
gainers
o n
occasion.
£>ove 700 will be posted for
More important to MMM fol¬
Daniels-Midland which
usu¬
tie first time in history belowers would appear to be its
hre the year is out. The pre- ally is dismissed as a feed
dominant position in the mag¬
manufacturer,
which
blithe
\ious high-water mark was
writeoff ignores some vigirous netic tape field, its 257% •
678.

Canada General

expense

*

Yield doesn't

Industrials,

17

18

Employment Economy
Requires Stable Housing

bedroom,
an
additional
bathroom, and perhaps a garage
well

as

FHA

credit-flow,

mortgage

reasonable

at

rates,

maintain

to

ample

an

assure

stable,

a

industry. The

building

home

refers to such

tapping pension funds, creating a Central :

as

measures

Mortgage Bank and emergency legislative support for FNMA. He is
disturbed

of

$13,500
amounts to

loan

by the drop in housing starts; objects to use of interest

%

of

Council

the

of

•

Economic

financing

breed danger¬

money

financing
practices. In hearings which we
held
in
1957, our housing sub¬
committee

.

home

unsound

evi¬

abundant

found

dence that the

a; control

as

mechanism;

Congressional

defends

inaction

on

*

Those

of

who

us

Ad-, disastrous

product that is sold, every

every

credit

that is
played a

has

Sees Home Building Decline

tion

It

en¬

the

ma¬

his

far
of

provides

banker

products

to
Albert

and

Rains

substantial share of the ultimate

for

the

home

buyer.

in the factories.

No

in the health of

our

omy

because
I am
seriously disturbed that the home

now

building

the

a

or

concern,

industry

decline

a

to

appears
once

past experience tells

be

more.

that

us

slumping home building indus¬

try

pull

can

down

the

entire

economy

into recession.

I

witnessing

decline
last

and

half

a

ago-r-in

years

early

1956. You will recall that at that
time the economy was well
along
in its
recovery from the 1953-54

recession.

Then

investment

was

idly, placing
ply of credit.
est rates
was

as
now, business
rising fairly rap¬

pressure

Then

on

as

the sup¬

inter¬

now,

rising and the Fed

were

relentlessly

pursuing

a

re¬

strictive monetary policy. Then

home

now,

downhill.

paid

we
ous

a

building had

As

all

we

as

started

know

now,

heavy price in the seri¬

economic recession which be¬

gan in the Summer of
I

have

detected

1957.

a

school

of

thought which apparently seeks to
establish the doctrine that the ebb
flow
of
our
economy,
and

and

more

specifically the fluctuation
between full employment and re¬
cession,'is both inevitable and not
necessarily unhealthy.
I reject this thesis as both de¬
featist and lacking in compassion
for the severe economic

hardship

which

an untold number of fam¬
ilies suffer in periods of economic
recession. I think we should bear

carefully

in

mind

the

fact

that

each

of our
post-World War II
recessions has bitten a little
deeper and that each successive

recession has left

lasting scars.
ployment has
level.

To

—we

must

ing,

or

me

I

do

Each

time

risen

to

more

unem¬

higher
the lesson is plain
a

find ways of
prevent¬

at least

progressively
nomic

larger and

moderating, these

more

serious

eco¬

contractions.
not

think

any




us

can.

five

building.

months

the

decline, very
erating rate.
Blames
In

likely at

profit

homes and there is

financing

parts of the country
ers

"a

In

financing

.

the

first

to

of

restrictive

a

suffer

I

many

is

to

truly

on

example,

borrower
loan with

Today

could

obtain

levels.

the FHA

In 1952
an

the

FHA

interest rate of 444%.
borrower has to

pay

5%%,
35%!

a

a
percentage increase of
When you take into
account
*2
of
1%
annual premium

charge

for

FHA

insurance,

this

that the home buyer is now
paying 614% annually for FHA

means

financing!
Taking

$13,500 mortgage
(FHA's approximate 1958 "aver¬
age) with a 30-year
maturity, this
tremendous increase in interest
costs
cost

has
of

a

boosted

the

the

financing

$13 500 mortgage by
Stated an¬
if the line had been
interest rates, the

approximately $4,500.
other

way,
on

home

average

buyer

could

get

an

addi¬

our

its

to

the

in

high

War

II

will

Subcommittee

our

in

and

Banking and
in

Cur¬

months

the

hearings and studies

leave

unex¬

avenue

no

trying

to

find

with

problem

to

an

I

candor

cannot

that

I

approach
a
single

even

preconception,

must

in

say

all
the

accept

propounded

which calls for

by
many
flexible interest

a

policy—which
seriously

far

as

1

are

by the facts of

ques

experience

outweighed by the

danger

we

court

borrowing costs

gages

and

:

so

very

in drit,

consumer

debt prohibitive. I

high that

instalment

fearful that
or'later, unless we call a
halt, the inexorable upward spiral
am

sooner

of

interest

day of

a

rates

the past

over

sure

we

have

we

few:years

reckoning

seen

will force

which

I

am

will all like to avoid.

!

I

recognize that the problem of
assuring an adequate supply of
mortgage capital for the home
building industry is a most dif¬
ficult and

complex

But I do

one.

feel,

strongly that we cannot sit
idly by and wait for the inevitable
readjustment.
What Congress Will Do

rate

policy on government-guar¬
and
insured
loans, per¬
mitting the rate to rest at what¬

forthcoming studies

our

hearings
ideas

vast

will

we

and

search

for

will

of

ways

of

We

all

will

tapping the

.

pension

examine

builders'

and

entertain

suggestions.

resources

We

funds

carefully the
for a Central

proposal
Bank.
We hope that
the field of banking

Mortgage

in

experts
will

have

And

I

constructive

proposals
quite frankly, if home
building is* on the ropes when
Congress ' reconvenes, land none
say

of these proposals has been found
to work, we will seriously con¬

sider providing a substantial sup¬

port fund in the Federal National

Mortgage

special
similar to
the billion dollar fund provided
in
the
Emergency Act of 1958,,
which in my judgment was a key
factor in sparking us out of the
Association's

assistance

last

dislikes

one

solution

operation,

recession.

Now

I

well

am

that the

aware

suggestion that additional FNMA
special assistance may be neces¬
sary

automatically

cries

of

ters.

I

inflation
am

in

brings

forth

many

quar¬
these

convinced

that

cries of alarm, however well-in¬
tentioned, are unfounded. I yield
to no man in my opposition to in¬
ever level current market
supply flation
and I am
aware
of the
and demand factors may dictate.
injustice which inflation brings to
I
have had some experience in
many of our people. But I am also
this field and I have learned to
aware of the fact that this subject
my sorrow that the word "flex¬
is
encrusted
with
a
welter ot
ible" has taken on a new meaning
anteed

in

his

my

thesis

—it

now

and

that

only

means

is

upward

notable

be

In

gear.

neces¬

highest priority by

Committee

While

as

should

sow

answer.

has

state

decline
the

a

well

key

a

compelling

parent

plored

people.

like

building

running

exception
prices.

farm
I

*

believe

as

conviction

the

ward

spiral

with

the

matter

a

that

in

the

and misunderstandings.

myths

Defends Congress'

one

case

Ceiling Rate

of
In my judgment, one of the most
unfair canards is the current cry

firm

of

endless

interest

of

thing

one

—

up¬

rates

is

that

the

failure

to authorize

the

of

Congress

higher interest

a

rate

government bonds
our greatest infla¬
from an
economic policy which
vital contribution to
tionary danger. To me it is ludi¬
bringing the
encourages,
even
wel¬ crous to
country back out of recession.. actively
pick on a single factor to
comes, every further increase in
Too
many
people overlook the
explain away the refinancing mess
the
other

an

a

home

dential

conse¬

alarming

bv

we

econ¬

share

the

given the
Housing

ahead. In

innovation

while

and
very

my

and

Burns

also

face

rency

characterizes

I

watch

en¬

for small busi¬

of

also

post-World

monetary

we have
interest rates rise
year after

Take the interest rate
home loan for

be

deliberately
starved
of
credit
during periods when our economy

Over the past six
years
year

our

cannot

you

reasonable terms necessary to
healthy, home building indus^
try. I know that this problem will

vital

a

judgment

a

with the

would

that

policy.
seen

in

vigorous opposition to

than

terms.

the

he

source

aspirations of

builders—like other small
businessmen and small farmers—

quences

are

tioned

In

may,

rate

said

economic

on

extreme impact
which tight money has on home
building and the home ownership

Home

are

small

Dr.

concern

economy."

concern

home build¬

reasonable

on

mind,

which

vital

our

unable to arrange forward

are

my

ness

their

on

itself.

which

interest

especially

of

sity of finding means of assuring
the ample flow of mortgage credit

a

Dr. Burns'

house under FHA has to
pay more
—far
more—for
house

in

of innovation

an

and

dangerous

.

times

spread,

We

selective

of

even

seeds of another recession.

neighborhoods,

maintenance,

can

while monetary
undercuts housing policy,
unsound
financing prac¬

which

ownership, the pro-^

sound

not

cases

home

industry is thrown into

those groups in our economy least
able to defend themselves. I share

beginning to stifle demand. Today
the
typical
family
buying
a

the

tices

stated
the
case
fairly.
General
monetary restraints hit hardest at

ger that inflated interest rates are

for

have

are

in

my

policy

have a reasonable opportu¬
to
survive,
prosper,
and

To

accel¬

devices

In

grow."

serious dan¬

a

home

businesses, which

nity

Tight Money

fair

of

the

omy;

annual

are making it
extremely difficult for builders to
a

the

his

con¬

does

expect the .Congress to stand idly

ac¬

other

and

restrictions

of home

new

mortgage discounts
realize

the

On

businesses

source

judgment the decline is
tight mone y. Excessive

to

lag.

very

some

of

the

convinced that these
theoretical advantages of
a higher

recession.

general

sub¬
hand

a

in

out

vulnerable

en¬

other

sales

render the home owner

while

only after

,

vironment

are

my

due

ing

highly unwise. In

instalment

and

in

am

the average
family may find the
financing costs of carrying mort¬

brief default.. These financ¬

a

ously felt

and

Over

an

by

In

title

by "and.

motion

private starts has fallen
by 100,000 units and every indi¬
cation
points toward
a
further

held

of

home

untouched

is

I

the

buyer/often

thrown

for

which-the
itself

of

the

tivities, such as consumer instal¬
ment buying, the effects are seri¬

sion

of

I cannot escape

the eerie feeling
that the economic situation today
is very much as it was about three

in

restrictions.

credit

econ¬

we

be

effects, it also appears that these
effects may interfere with some
key objectives of national eco¬
nomic policy—such as the exten¬

slow but steady

a

have

building industry are apt to feel
the impact of general credit re¬
straints fairly promptly and more
keenly. But not only do general

building industry.

disturbed because

am

rate

overall

are

credit

small

indifferent to trends

be

can

greatest

aspect

into

re¬

interested

one

gaged,

stantial

and,

in the home,

And

employ¬

market for hundreds of

a

segment of
the money market which
gives me

headed

led

nearly 3 million men, on-site and

it accounts for

the

has

in recent years, it
provided
employment
for

has

his shelf

is

economic

it

and

the

mortgage

This

of

key

reaching economic importance
$15 billion home building
industry. Residential construction

the

financing

res¬

in

those

as

Government

And

of

refinancing that have in

case

tracts,

branches of activ¬

some

such

Federal

downswings and

on

ity,

economy

This is not simply a sta¬
tistical coincidence. It reflects the

construction

loans,

indicator

Historically,

however,

covery.

with

financing, it

a

and

help¬

a

the

re¬

a

of

saving

family is largely

mg

consequences

the past proven

When

policy, it does this
with
a
view of restraining, the
growth of total expenditure, not
to benefit one type of activity or
to
injure another.
In
practice,

We

economy,

production

ment both

inventories, it
provides the

of

in the

vigilant to offer

"leading"
trends.

carry

recession.

to be invalid.

appears

lems

econ¬

strictive credit

my

It is widely recognized that
construction
is
a

overall

enables

another

the

of

the government embarks on

reduc¬
In

idential

to

builder

working

constantly alert to signs

ever

terials dealer
carry

*

omy

cannot shrug off the

hand
to
keep the
moving in high gear.

every

step of the
ables

,

bread¬

income.

ful

Bank credit is

way.

red uced

we

of weakness

also

its

:

consequent

a

family

be

of

one

or

-

and

in

must

In no industry is credit more
important than in home building.
at

hours

judgment
danger of

vital role.

vital

of

moves,' winners,

or plane that
and behind every building

truck, train

constructed,

ployment

sectors

I
and15

providing

needs,

the

.

different

of

recall

•

on

of

by increases
interest rate level. '

,

visers from March 1953 to Decem¬

*

average

serious

..

Af

no

save

judgment the rate of
the

unaffected

—are

"

purpose

■

egg for future

sales

pyramiding of second and third
ber
1956, was a chief economic mortgages
prior * to
the - Great
>
government bonds' interest rate; and asks that "full" employment
adviser to President Eisenhower.* Depression
are.
naturally *, con¬
and price stability be both explicitly stated as national goals.
• ;
In his book entitled "Prosperity cerned when we see the return of
Without Inflation," he makes the similar
practices. Not only
do
Because banking is such a com¬ afford to be complacent when we
these loans double up the buyer's
following statement:
plex operation, few people realize realize that iil this last recession
"Th,e traditional assumption that payments in the - early years but
12
million Americap* families—4
the fundamental importance of the
when written as balloon payment
banking system. All too often they that is, one out of every four— general/:credit controls;r®xergise
overlook
the
fact
that
behind suffered either the total unem¬ something like a uniform impact loans, they raise the. same prob¬
rate

nest
my

questionable devices, such as land
.

virtually

decisions to

majority of our citizen,
average family saves
with thi

have

-

Jl

vast

tight money of that
period
had
driven
builders
to
adopt second mortgages and other
contracts.\.

the

primary

of

have

occur
on

The

has another effect

particular concern to

mortgage

ously

Many of us in Congress feel a.
growing concern about the uneven
impact of hard money.
I would
like to quote if I may from Dr.
Arthur
Burns,' a « respected and
able economist, who, as Chairman

ranking House Banking and
Currency Committee member and Housing Subcommittee Chairman
healthy

present
a

.Quotes Dr. Arthur Burns

•,

to

the

financing cost of

the

That is the fact that shortages

me.

they
feet

.

mortgage

is of

which

Thursday, December 10, 1959

ac¬

v

**

home

on

$16,200.

recession, Rep, Rains promises that he and the Congres¬
measures

At

itself.

home

the

V

' '•

.

.

of

level

stable

a

ot money

Actually the cost of financing the
home over the life of a mortgage
loan is far more than the cost of

30-year

Linking housing declines to tight money and, in turn, to causing
sional Committees concerned will seek

tivity.

the.. amount> saved;*

for

rate the

By Hon. Albert Rains,* United States Congressman (D.-Ala.)

™p'utain

.

it could

costs would be reduced if

tional

Full

economic

Chronicle

The Commercial and Financial

(2414)

is
•

construction

side

the
the

on

the

of

fact

that

home

period,
has

coin.

resi¬

made

And

declines

building

not

It

appears

industry

when prosperity hit the
economy,
our
economic
managers
have

panicked and said to
"Let's cut* back
and

it

save

sion."

I

am

on

for

one

another,
building

home

the

next

convinced

reces¬

that

not

just home building and housing
policies are hurt by this, but that
the entire economy suffers.
Finds

Buyer

Penalized

This policy of
allowing • wide
swings in home building penalizes
the buyer through
higher costs. It
is impossible for an
industry to

plan intelligently if it
to extreme
common

would

sense

be

is

subject

fluctuations. It is only
more

that

the

efficient

industry
and

its

rate

must

turn

structure.

A
,

.

Poor

to

curtail

should

are

supposed
in

boom

periods by restraining borrowing.
But the record is plain that
higher
interest rates exercise little if
restraint

ity

of

ments

on

the
of

the

borrowing

more

our

Theoretically

we

interest

combat

inflation

our

capac¬

powerful

seg¬

economy.

higher
more

any

are

rates

it

is

issue

long-term

now

a

bonds in

setting. Such
inevitably raise

the present economic
an

action

would

long-term yields and could have
a
very harmful effect upon the

availability of mortgage funds.
As

a

matter

of

fact,

you

^.

will

recall that the

Congress wTas pre*
pared to compromise with the Ad?
ministration

on

the matter of

the

All we asked
that the bill contain

interest rate ceiling.

told

that

will

help
encouraging

by
savings. Again the facts in

recent

finds
serious
government

the Treasury

Actually7,

question whether the

Weapon

investment

long-term

at .present

itself.

In my judgment this policy has
proved a dismal failure. In theory

higher interest rates

is

in which

Finds Interest Rate

in
into those recessions.
that in recent years

us

We

answer.

interest

that

forced

have played an important
part

leading

the

a

on

in return

was

provision regarding the Federal
Reserve System which expressed
the sense of Congress. In my judg*
a

history have not sup¬ ment it expressed a perfectly sen¬
theory. All we have sible view and in practical
e^c*
seen as interest rates climbed
up¬ did no more than spell out what
ward is a competitive rate war basic
Fed policy* should be any¬
between the various groups who
way.
Moreover, it did not bina
bid for the
savings of our people. the Fed to any* specific
actioi^.
The difficulty I am convinced is Modest as this
provision w^as, the
that
interest
rate
increases
as Treasury^ and the Federal Resen e
ported

this

Volume

190

Number 5906

.

The Commercial and

.

.

Financial

Chronicle

(2415)
.Board
and

raised

tremendous

a

They

cry.

claimed

that

hue

I

this

occupation

{provision was completely unac¬
ceptable and in the end they suc¬
ceeded in killing the
too

people

many

Federal

bill.

that

is

the

crea¬

a

of Congress and the arro¬
gance in the implication that the
Congress cannot express its opin¬
ion
on
Fed
policy disturbs me
greatly.
v

ture

Moreover,,

must

we

interest

that

remember

I

need

an Administration which
of

economy

can

we have seen in the
j?costs of carrying the national debt.
Back in January, when the Presi¬
submitted

his

budget

it carried

1960,

for

item

an

of

$8 billion asv interest en the debt.
That figure was recently revised

$1 billion without a
of complaint.
This is truly

upward
word

by

.

inflation of

£

vengeance.

a

!

budget costs with

our

/

Wants Both Evils Condemned

While

would

I

am

like

!. vigorou s
which

this

on

to

take

subject,

note

this

ject

companies

are

con¬

Efforts
to combat inflation—real inflation
course

are

commendable, but
why we do not see

I often wonder

similar newspaper campaigns urg¬

ing aid to the unemployed in times
1

of

recession.

I

wish

that

more

leaders of the business

community

would show

are

that they

concerned

as

cession

at least

the evils of

over

they

as

are

re¬

the evils

over

of inflation.

Again while on the subject of
inflation, I would like to take this
opportunity to say that I am in
wholehearted

accord

with

one

of

the recommendations of the Amer¬
ican Bankers

understand
as

Association, which I
adopted formally

was

resolution.

a

That

is

the

rec¬

ommendation

that

the

ment

1946

should

of

Act

amended to

Employ¬

purchasing power" is
effect the same thing, but I be¬
somewhat ten¬

a

' pay

All

of

:

.

I

us

stated

be
.

would

like

growth with stable prices. It would
to me

seem

that

welfare.

unarguable, therefore,
an
objective should be

such

outlining our national eco¬
policy. At the same time I

nomic
would

hope

Bankers
would

that

the

American

Association

along'

go

amendment

to

with

objective
another

the

Employment
Act of 1946, which I regard as
equally important. I believe that
the

Act

should be renamed the
Full Employment Act and that it
should
state
unequivocally that
full

employment

is

national goals.

of

one

\

.

/

our

.

Many will recall that when the
.Employment Act of 1946 was first
considered, it was called the Full

Employment Act.
engendered

This

one

word

much

controversy
that the phrase full employment
was
finally stricken. It was said
at

that

ment

so

time

were

tive that

that

made

ments
of

•

we

tunate

if

full

employ¬
policy objec¬

our

should

be

of inflation.

result

finally

was

passed

jectives.

It

inflation

nor

is

led

into

The

that

the

dropped

bill

both

as

ob¬

not

for full

be directed both toward stable

prices

and

toward

insuring that
employment opportunities will al¬
ways exist for all men and
able and willing to work.

Frankly, I often think
too much time

mills

of

fails

or

to

RAILROAD. SECURITIES

do

re¬

a

powerful voice

matters—it

already

Freight Car

Shortage Looms
powei*t
wisely.
That as I see it is the'
A shortage of railroad
major challenge which lies ahea
freight cars increasing
emphasis
on
their
And I am confident that this
great already is affecting some indus¬ piggy-back operations.
democracy qf ours will meet that tries. The nation's carriers have
Another situation which could
been
scrapping freight cars at hurt the railroads from a traffic
challenge fully.
double the rate they have'been
''
*
point of view is the possibility of
"An address by Rep. Rains before the
putting new ones into service.
a
rail strike or slowdown. It
is
how

to

that

use

which
present
L

-

women

we

tilting at the wind¬

past economic

problems.




allow

"re¬

price

we

ourselves

to

do

not

belittle
our

in

mean

any

the

accomplish¬
forces and
experts.
They

military

scientific

Savings

and

r

*

.

Mortgage

Annual

Convention

Bankers

Association,

„

Division

of

the

Miami

the

at

Flor¬

themselves will

men

first

to

tell

that

us

we

the

be

not

are

doing

path

of

dan¬

enough and that the
half-hearted effort is a

a

oneiindeed.

In

judgment

my

also

saddled

policy which
cupied

nation

our

with

be

to

seems

is

economic

an

preventing growth
rather than encouraging it. A bal¬
anced budget is a goal which all
of

seek

us

in

periods of economic

prosperity.

But it

seek

a

it

and

as

quite

fetish

is

one

desirable

another'to

which

thing to
objective
it

make

blinds

to

us

'our

platitudes of the past which
bind

to

face
and

thinking.

our

the

future

recognize

basic

truth

We

with

what

and

to

Mass. Investors

to regain the

N ames R.

40,097

Bailey

department

Trust

was

able

Chairman

.a

the

only road to a balanced budget—
price stability for that mat¬

and to

ter is—the road to a growing and
expanding full employment econ¬

as¬

the

of

and

trial

Bailey

Boston-based

Earlier

with

Honolulu

he

C.

as

had

Brewer

indus¬

an

engineer and

with Raytheon
production engineer.
Bailey will do investment

Mr.

research

as a

in

a

Refers

G'.E.I).

to

selected

industries in which

gro ip

of

the Trust has

investments.

Service for Paul A. Just

Study

large-scale

this
hope for
economic " growth,
1

would

to

a

of

support
like

call

attention

to

recent,study by.the Committee

for Economic Development, one of
our

leading

ten

and

research

ness

than

past

resume

of

rates

total national output
from now will be $624

fully $189 billion

—

1958, the last fiscal
before the full impact of the

last recession.

This projected rate of economic

has

growth
tions

for

The

lion

changes from

no

1958

1968,

billion

will

be

Director

of

Television

Management
held

Corporation,
Saturday. Dec. 12 at

2:30 p.m. at

Hepplethwaite Chapel,
Evanston, 111.

With Eversman In v.
NEW

the

in¬

Bond Club of

There

ing

industry. From

weather

mediately
ended,

1,640
when
due

cars

Trust

strike

been

cue

because

day

a

steel

is

that

ice

to

conditions,

the

normally
moves
by
Lake
freighters from the Northern iron
ore

ranges,'will have to be hauled

by

rail.
additional

fact

that

the

rails'

own

for

the

and

lor

number

obtaining steel

construction

of

new

repair

on

the

work

of bad

order

rine

Trust

Trubee, Collins & Co.; Charles H.

Wiest,
Co.

Vietor,
•

•

-

:

the

boui
cars

SOUTH

large

Gann
.131

BEND.

lost.

To

are

in

become

jump from

$69

Stock

$105 billion in the
increase of over $25

an

only ten years' time.

to

17,

is

over

worrying

will

be

E.

counteract this

the

York

This advertisem ent is neither
to

buy

any

the

a

is

the

earth -and

spite
ford.

system

is

country

the

best

devised.

ever

We

cannot

misery

Nor

of

afford

can

ard

an

recession.

afford

to

We

gamble

As

a

result of

depression and
war,
the Federal

cold
ment

is

factor in

a

our

these

cost

Federal

mostly
of

debt

largest

single

A copy of

the Prospectus

Underwriter

or

may

'

be obtained from the undersigned

from other dealers in

the securities may

any state

where

lawfully be offered.

J. EARTH &

It is

Our

total

exceeds

$290

wars.

now

Share

and

Govern¬

nearly, $80 billion
for defense and

past

per

soul-

a

hot

economic lives.

spending

year,

the

the

now

$10.75

cannot

on

intrusion into the private economy
because that intrusion has already

searing

Corporation

the

matters by leaving them to chance.
This is not a plea for Government

taken place.

Shares

(No Par Value)

Price

December 9.

1959

,

.

the

are

Elmer

Cleary, Treasurer; and Davios

Robertson, Secretary.

Common Stock

runaway

Dec.

Richards, Vice-President; Rich¬

In

afford

we

of

President of

Other officers

on

eco¬

of this wealth, there arc
things which we cannot af¬

inflation.

even

richest

ours

Dutron

New

of

Exchange membership

offer to sell nor a solicitation of am offer
of these securities. The offering is made only by the Prospectus.

118,030

the
as

acquisition

Albert MeGann,

the firm.

per¬

expected to place

with

-

American people,,
stronger military de¬
fense posture, and also offers the
hope for ultimate tax relief.

including

nomic

of

Exchange

re¬

bil¬

to

Me¬

Inc.,

Exchange, will

members

cur¬

is stifled by
unduly restrictive monetary pol¬
icies, in my judgment the natural
expansion of our economy will
make it possible to provide greater

Ours

Company,

West Washington, members of

Unless this growth

services

Ind.—Albert

Securities

the Midwest Stock

by

the carriers

&

cars.

officials since they are afraid

manently

Dann

•

Be NYSE Member

ditional traffic will be turned

traffic

Common.
f

Albert MeGann to

New

this

New

..

Jack B. Sharpe, Blair & Co. In¬
corporated; Frank C. Trubee, Jr.,

shippers have turned to
increasing use of trucks and
if the shortage should increase ad¬

of

Stoddard,

Western

of
•

Some

This

Co.

York.

an

the truckers.

W.

Directors: the officers and John

York

rail

Ralph

of Buffalo.

R. Gronachan, Dominick & Eotninick; Robert J. A. Irwin, Jr., Ma¬

builders, including
shops, are having

ear

difficulty in

is

squeeze

r s

ore

that

An

d 6

Co.

Bank

to

the

of

factor

W. Dorr a

Secretary: Bertram Parsons,
Stevens, Cornelius & Parsons.

the Great Lakes close down

with

Co.,

the

Another

some

Botkins Road.

after

the figure has

weather.

construc¬

were

For kin.

•Vice-President: Charles

is

a

J.

rics, Manufacturers & T

raw

daily short¬
open-top cars, im¬

3.000

of

age

C. Rinehart has become connected

Investment

cold

directors

Edmond

Treasurer:

present

Buffalo, the follow¬
and

President:

com¬

of

officers

Doolittle & Co.

particularly
industry which is
stocks

■

elected:

will

up

work

lost business.

BUFFALO, N. Y.—At the annual
meeting Friday, Dec. 4 of the

usual

of

shortage.

and gravel for the

tion

to

KNOXVILLE, Ohio—Donald
Eversman

if

shippers of bulk
steel

possibility

have* to

implica¬
financing.
found
that
if

rates, Federal budget

would

in

year

Shares

year ago.

pattern

build

the

tremendous
report

were

rent tax

ceipts

and

the

with

would

Government

CED

there

Just, regional Vice-President of
Hugh W. Long & Co., Inc., and
previously Executive Vice-Presi¬

more

in fiscal

year

A.

our

years

billion

busi¬

organizations: This
that if we do no

shows
than

respected

Memorial services for the late Paul

dent

a

out

This

this

on

carriers

Elect- Officers

on

preventing a. worse shortage. Lut¬
ing -Warmer temperatures opentop cars also would be moving
sand

another

associated

Company
•

Richard B.

fund.
in

low.

than

less

the coal and iron industry

other

trans¬

Buffalo Bond Club

1,553,-

and gondola cars also
short supply. This is
being

The

super¬

Co.

&

of

cars,

in

affect

charge

at

to

18-year

cars

car

of

are

materials.

research

vision

talize

traffic occurs, there' could
acute

an

trying to

Presi¬

dent in

an

pointed

modities.

staff, was an
intmslry spe¬

-

is

and

ing the'Trust's

Vice

17,000

felt by

omy.

In

It

per

Bailey,
to join¬

to

almost

forms

The service¬

amounts

now

and' 40',000 less than-

are

sistant

There

already is serious shortage of hop¬

or

cialist and

order.

on

installed

Association

July 1, just before the steel strike

be

trustees.
Mr.

is

creased

today
by Dwight P.
Robinson, Jr.,

prior

cars

cars,

This

the

Railroads.

fleet

000

and

cars

of

spring- seasonal

an¬

nounced

been

is

Massachu¬

of

82,849

Division

American

setts Investors

must

that

other

the

mutual

me

is

that

believed

portation would be quick, to capi¬

39,870, according to the Car Serv¬

seem

confidence

month-period
October, the roads re¬

ice

a

needs and capabilities as a nation.
In my judgment we must shake
off the shackles of the economic

twelve

tired

preoc¬

with

the

ended with

ida,

search

these

In

American

Beach,

BOSTON, Mass.—Appointment of
doing a Heartwarming job in
Richard'B. Bailey' 'as
an'industry
trying' to preserve our national
''Specialist' ih!i theMhVestmMt' iresecurity.
Nevertheless "many : of

now

spend

constant

a

terrible

*

are

a

unfor¬

flatly against
employment.
I am convinced that it is
high time
we
correct this lapse and estab¬
lish a firm
basing point so that
the policies of our Government
can

I

economic

has—but

cannot attorn

program.

is

we

of

our

some

program

in

'

the

I

-to

way

clearly set forth in the basic docu¬
ment

ment should have

grow

daily
newspaper
lag in the field of

our

of

growth,

.

sure

am

ex¬

maximum employment and

see

in

be
governed by a * timid pennypinching approach to our national

more

should

almost

wren

objective

to

vital

are

must not

we

c.oas

repercussions throu* out the
business world. The problem fac¬
ing us is not'whether the Govern¬

continu¬

are

Obviously, everything that

Government

imaginative

We

we

science

report

.

and

we

"standpattism"

on

space

uous-argument and agree that the

plicitly.

that

to

The

be

''maximum

lieve that this is

the

proper' has

a

pervades our
governmental policies.

incorporate price sta¬

bility as an additional stated ob¬
jective of national policy. Some
have, argued
that
the
phrase
in

billion.

pre¬

of

-

this

seems

I

the

of

ducting against inflation.

—of

bold

.

policy.

that

or

gerous

campa ign

newspaper

some

a

too fast and that

an

blandly accept the tremendous in-

fiscal

obscure

ously told that

minder

are

| creases which

1

of

economic

|sible how

dent

to

our

.

costs

much

often

problems

convinced

am

stories

so

too

with

vision of the future.

impor¬
tant
item
in
the
government's
£ budget. To me it is incomprehen-

*talks

that

ten.s

past

I think

forget
Board

Reserve

think

19

CO.

20

The Commercial and Financial Chronicle

<2416)

Thursday, December 10,1950

..

.

J

S

111

s

remaining parts should be ready

tions

by the end of the year.
r;
To estimate the total capacity of

type, of

the various fuels becomes of para¬

the

mount

are

the O. E. E. C.

to

European Nuclear Energy Agency

importance. It might, per¬

be thought that the recent

haps,

By R. P. Ferret,* Scientific Consultant

.

ket, was t r ans f o r m e d into a
buyer'? market. In such circum¬
stances,; the: comparative cost of

assesses

the foreseeable growth

estimates of

are

elusions about nuclear
furnish

growth for the 1958-65 period

careful

will

competitively economic before

types in certain countries such

as

be spent for

1975, except for some

in United Kingdom and Italy. All

^Before

becoming vital, depending
the country, between several to 10-15 years from now. m -

attempting to

importance
Europe's
worth

energy

spending

power

in

it

is

economy,

few

a

the

assess

nuclear

of

moments

looking at

.on

her

her

present

pro¬

are

possible to relate energy re¬
quirements to the gross national

extrapolating

the

an

en¬

can

4%

per

annum,

al-

R.

though this rate of
been

in

dropping
with

compared

Europe

P.

the

increase has
recent

years

period when

rafter-effects of the Second World
War.

European

primary

energy

production

of

has not kept pace

with the increase in consumption,
and it has
sary

to

therefore

rely

fuel

imports.

1948

and

less

than

been

Whereas,
Europe

one-seventh
of

TOTAL

neces¬

increasingly

1950

quirements

applying
one

of

arrives

upon

between

imported

of

her

re¬

primary fuel, the
INSTALLED

for

do¬

primary en¬
Europe in 1975.

it

that, between

now

ments
about

2.3

evident
will

in

rise

to

that

not

be

predicted

and

1975, Eu¬

can

primary
will

similar

total

ergy demand
On this basis

rope's

various
at

require¬
average of

energy

by

3%

an

per

the

annum.

rate

of

It is

growth

be

absolutely constant,
that we shall see periods of
slight recession alternating with
periods of more rapid progress.
By way of example, Europe has
recently passed through a
in which the rate of eco¬

very

phase

down.

this

expansion
The

was

slowing

was

immediate

that the

effect

of

energy market,

which

had,
for
practically all
types of fuel, been a seller's mar-

ELECTRICAL CAPACITY IN

deadline, a year which
fairly closely with the

that

the

Europe

whole,

as a

of

sources

.

little

with

the

Sahara

sources

of

are

France.

great

In

as

and

to the effect

petroleum
evolution of fuel

gas

on; the

imports
as

if

applied
country.
Under

to

conditions

in

Europe, it is clear that the major
in shaping a long-term
policy must be to assure an abun¬
dant and cheap supply of
energy.
The consequence may well be that
fuel imports will be

larger

difference

mere

tential

power

total

about

demand

Moreover,

would

in

view

forcement of

plotted

Europe
1965

the

of

the

With

in

energy

1975.

means

Europe

certain,

vital

that

her

into

announced

by

the various Euro¬

countries,

pean

one arrives at;
J
figure for the total capacity fore¬

cast

for

over,

a

is

Europe
9,000

say

estimate

a

These
have

we

8,500

in 1965,

MWe.

over

further

18

4,000

it

and

is

MWe

(or

8.5

new

study

Energy
under the

of

sources

matters

by

recession

dent

therefore
to

seem

regard

more

,

pru¬

estimate

our

of

IN .-'EUROPE

Nuclear

Capacity
j' r

GWe

10
'

!

"

w'.r5

"

V

«

►.

i

_

1

1

i

/
/

:

1

S

/

.

'

•

■

»

1

'i

*

;

i

■A'.

i
•-

-

^

J

>

.

"
-

•;

i.

■~

V

►

4

*

L{

(
71

'■

-■

■

.t

;

•

7

/

\

'

:

*;
■

!
ENEA

-

1

<

OIIC

1955

T960

\

1

1

ms

i

;

tm

no

there¬

OCTOWB

sc. I

owe

DETERMINATION OF THRESHOLD OF COMPEimGM
BETWEEN CONVENTIONAL THERMAL POWER
STATIONS
AND NUCLEAR POWER STATIONS

currently

O.

Advisory

affect

may

and there may be some

energy.

are

the

GWe). ;It

(at the end! of the year)

any

for Europe to ensure
supplies of energy are
regular and. uninterrupted.

the

basic

have adopted for 1965

bringing themanto service. It

would

sta¬

rein¬

of
primary
between now

of just

The

delay in constructing the stations
and

a

situa¬

be

the

officially

*.•

will

in
to

up

account

programmes

TOTAL INSTALLED) NUCLEAR CAPACITY

One of the most effective
ways of
achieving this would appear to be

sor

national

schedules

po¬

This, however, is by

fore

both

period

Total installed!

growing diversity of
imported fuel, it seems

unlikely that there
prolonged
shortage

under

} 4.2 •/.

will

the
of

in¬

capacity

the

takes

one

economic

MWe.

of just

takes second place to that of rela¬
tive costs.
' *

sources

the

(Figure 1).

If

al¬

warrant.

financial

ckn

curve

a

shows
installed

over

capac¬

is

total

a

Europe, the question of
payment
in
foreign
currencies

and

station,
which

in

in

These

GWe

1,700

Finally,

give every possible encourage¬
ment to the development of each

Capacity

financing

stations

capacity

than

between

of

32

indigenous production and

total

tion

of

25

particular

any

present

which

ity

erroneous

concern

the

for

and

ready assured, with

only valid for Europe MWe.

are

whole and could be

a

the

words,

of

sources

oil

importance

other

above conclusions

European

fuel

and

gas

TU

decided, the sites chosen, seems, however, that the general

to

EUROPE

capacity of

3500

Using the dates
putting into serV-

each

crease

than 2,000 MWe; seven

more

and

gas

total

a

be

-

capacities

MWe.

of

be

projects.

sites,

oil will benefit each country
varying degrees. For example,

of




cover

advanced-

capacity will

MWe. "

these

ice

limits of the national programmes
and

the prelim

well

nounced for the

the

coincides

is

seen

3,000

chosen

has been

Total installed
Electrical

nec¬

as

therefore

stations the construction of'which

but

nomic

the fuel im¬

reduce

1965

have

in

demand

and

these

Ferret

recovering from the

was

industries

estimates

•

in

consumption and estimates

methods

of

Increases

be also drawn up by
country.

In

by

rose

some

mestic

Eu¬

en¬

be obtained by
the
evaluation
of

can

be forecast by sector, for the

principal

of

average

latter.

can

con¬

primary
ergy
in
rope

this

forecast of future

a

demand

ergy

1948

sumption

by

it is

trend.

1958,

methods

many

be

We

and

work
total

tho

decide

power
stations it \M
that by 1965 total
nuclehr
capacity in Europe will be about

be

ticularly hazardous to forecast a,
way
ahead in the nuclear

fuel

to

future

overall

risen

Evolution of the European Energy
Situation

product,

and

has

quarter.

a

duction,
and
the
probable
Between

1956

can

sources

40%.v It should be'.poted that these
'forecasts

which global energy requirements
can
be estimated. • Firstly,
since

for

energy,

about

There

present

demand

to

since

Continental

in

all

long

field.

projected. For these

Reactor
has been
outline

to 4,000

by

and

proportion

the

on

The various nuclear power sta¬
by about one-third in 1965
a little more—say 40%— tions projected can be divided as
in
1975.
five
However, despite
the follows:
prototype
power
rapid
development
of
these stations already in service, with a
sources
of energy,
fuel imports total capacity on October 1, 1959
from' sources other than Sahara, of just over
200MWe; 13 stations
will rise in absolute value, be¬ under
construction,
for
which
tween
1965 and
1975, by about work has already started on the

in all, the author sees this kind of energy
upon

based

inary
their

essary

consisting of $120 million for fuels and $40 million plant; and would
become

to

serve

and

thermal and hydro power; involve imports of $160 million
per year,
not

oil

fuel

production of

ports which would have been

total capital investment

mean a

of $3 billion which will be less than that expected to

and

of

Europe and the Sahara it

4.2% of total installed European capacity by 1965, most of

which, however, will be experimental;

else¬

and

help to bring pro¬
from
European sources

predicted that these local

that it will:

are

Sahara

might

the estimates

gas

con-

be

can

are

broad

in

stations which
Europe, cal¬

The uncertainty attaching to the
various programmes and to tech¬
nical developments makes it par¬

the

France,

into line with demand. According

capital requirements, cost competitiveness, and effect

the terms of the balance of payments. Some of the

on

culations

in

in

to

of nuclear power in Europe. Detailed

built

being

plans for the individual stations.

duction

Keeping in mind the supply conditions of various fuels for European
and the demand for cheap supply of energy there, Mr. Perrett

nuclear power

discoveries of oil and natural gas
where

power

..

E.

E.

C.

Commission

chairmanship of Profes¬

Robinson of the United
King¬
the Report of the Commis¬

dom:

sion will be nuhK«hed at the
end
of this year. The

lit

Nuclear

(First fuel charge included)
CAPITAL

$/KW«]

|00

COST

150

European Nuclear

Energy Agency of the O. E. E. C.
(ENEA) has collaborated in deal¬
ing with the nuclear energy as¬
pects of this work.
Estimates

of

Nuclear

Energy

Production in Europe
►

58.4 %

Let

turn to the question
as to how far nuclear
energy may
become a cheap source of
energy.
For some time
past, ENEA has
been engaged in
forecasting the
us

now

production

Europe,
have

of

and

been

nuclear
our

energy in
main findings

published in

the

Pro¬

ceedings of the Conference which
ENEA organized at
Stresa in Italy
in

May of this

of

the

Stresa

year. The
Conference

object
was

to

bring together
industrialists, busi¬
ness

men,

experts

in

discuss

the

financiers

and

power

order
to
study and
rhythm of and con¬
ditions for the industrial
develop¬

^ 37.4

ment of nuclear
energy in
with particular

Europe,

reference to

ENEA

_

-

OIIC

requirements,
moderators,

special

fuel

metals,

equipment and in¬
The first part of this
entitled "The Industrial

struments.

Report,
Challenge of Nuclear
Energy" 'is

1965

now

Fossil®

available

and
contains the
nuclear energy forecasts
which I have
just mentioned. The

study
OCTOMB rtst

on

6

7

8

9

mitls/kWfi

60

70

«0

90

ctnl/fTiio

BlU

Volume

190

Number

5906

>00 MWe as-more valid for 1966

<

.

.

The Commercial and Financial Chronicle

.

(2417)

stations during the same analyze the cost factors of nuclear
period. .»• /
? V • ;
energy and a study of this kind
-r"
The figures are sufficient proof has
been
made
by ENEA. The
lilosophy of the Nuclear Power that
Europe's nuclear energy de¬ aim of this study was to deter¬
Stations Programme
velopment programme from now mine the different * factors, the
Turning now to a qualitative until 1965, although in the nature incertitudes
and
the' orders
of
ialysis
of the various
power of an industrial experiment mak¬ magnitude, rather than to produce
itions
at
present under con- ing only a very small contribution accurate calculations of cost.
ruction or projected, it can be to the total output of energy, al¬
To make a valid comparison be¬
for

than

jf 1967

1965.

j; /•

power

-

*

'

■

i

.

■

i

.

,,

|id that most of these stations ready
of

;e

experimental character,

an

bey

in fact,, large-scale in-

are,

ustrial

experiments

isential

'purpose

ita

behaviour

the

on.

with
of

the

is

this

United

Kingdom,

small extent Italy.;
main object of this

id to

The

trial

.

eriod, 1958-1965, will be to ghin

tcperience leading to a reduction
(the construction and operating

c

osts of nuclear power stations.
The

growth

nuclear

of

energy

i.the short run, 1958-1965, seems
lerefore to be governed rather

desire

the

y

know-

acquire

to

..»dge or to gain a position in the
larket for equipment than by the
nmediate necessity
to
produce
in e r g y: such growth will be
'inited by the financial resources

vailable.
Tnited

An

exception

the

is

Kingdom, which has taken
in

lead

nuclear

its

.and

ramme

power

which,

pro-

with .Italy,

the greatest and most pressing

jas

jeedi of
for

tries
"heir
Ore

tie

all

the

new

European
of

sources

stations

power

produce
grid.

the

coun¬

energy,

will

electricity

Imports

.

and

there-

feed

to

electrical

capacity
in
Europe (both thermal and hydro)
made by the O. E. E. C. Electric¬
ity Committee show (Figure 2)
that nuclear power stations

MWe)

8,500
4.2%

will

an

stations will have a capac¬
of about 6,000 MWe and en¬
uranium power stations a

fuel,

it can
be
reckoned .that
European demand for enriched
uranium

will

be

entirely by
imports from * the United States
but
that by
19G5 fuel elements
may be manufactured in Europe.
With regard to natural uranium,
it may be assumed that the re¬
the

United

than

other

Kingdom will be suf¬

ficient to meet their

requirements,
and that dollar purchases will not
exceed

40

to

50%

British

of

ports, which will be in
of

im¬

the form

ore.

duced
of

is

much

will

tions

be assumed
power sta¬
entirely by

can

uranium
built

be

while
on
the
average
20%
of the plant and
work
involved
in
constructing
firms

uranium

enriched

will

be

paid

suming

dollars.

the

annual

nuclear

in

will

1965

stations

power

in

for

that

some

by

conventional

generation.

estimate

to

for

nuclear power

real

a

perfectioning
call

to

pro¬

As¬

methods

load

during

for

factor

stations:

more

or

their

around

the

be

less

than

conventional

thermal

the

other

their

hand

design

advanced
base

will then be

ventional

the

be that
sufficiently

to

their

the

carry

load

factor

higher than the

con¬

first

average.'. The

eventuality

on

may

be

them

and

most

of

stations;

it

will

for

load,

that

power

for

total

than

of the

4.2%

output of energy in Europe.

As
to

less

nuclear

information
shows

recently

that

kWd

the

needed
power sta¬

the

will

period

$400.-to

pub¬

cost

tend

1958-1965

$300

per

fall

to

uranium power stations, and from
S350 per kWe to $280 per kWe
for those using enriched uranium.

Assuming

for

this

period

an

£verage capital outlay of $350 per
kWe
(excluding the initial fuel

charge) for natural uranium, and
of
$315 per kWe for enriched
uranium

capital
would

amount

total

same

c a

thermal
at

suming

total
1965
to $3,000 million.
period, 1958-1965,

stations,
investment up
to
power

the

p

i t al

power
some

an

*

has

(as¬

of

$140

cost

average

for

hydro

stations at $7,000 million

cWe).

a p

i t

nuclear power
to

1965

quarter

vested,^
S'r

a

1

in.: :

the

power

(assum¬

$300

in

1958

[c. i. f. price $20 to

ton, 8% refining loss, 35%

per

of the efficiency of

thermal power
with crude oil.

stations]

however, this mon^y were
on imports of nuclear fuel
equipment, allowing for

If,

spent
and

capital investment and
local fuel sources, about 56 TWh

European

electricity,
little

more

with

as

twice

than

the

the

on

or

average
as much

im¬

corresponding

fossil fuel, could be pro¬
provided that the nuclear

ported
duced,

stations

amount

a

in¬

,and>. thermal

{<■




E.

C.

E.

Elec¬

tricity Committee in collaboration
ENEA.

The

ventional are:*;
The
and

cost

:

;

:

Since

>

The

(including

which

outlook,

establish.

to

:

.»

J

:

relative

impor¬

financial charges

in the

tance

of

retail

price of nuclear energy,'it
it

that

would

not

be eco¬

nomic, during the first phase in
the
development
of
industrial

stations,

power

to

stations, one nuclear and
the
other
conventional, become
competitive when operating under
identical conditions, the same load
factor and period of depreciation
can be assumed, and for the sake

supposition

would

of

clear

operating

same

nuclear stations

of

certain types

could, from about

1965, be competitive at a running
time
it

of

is

6,000

hours

possible
the

be

annum,

per

what

estimate

to

installed

total

nu¬

capacity in Europe towards

1975.

The

factors

variable

there¬

are

of the load diagrams,

The form

fore the financial charges,

the cost which is evolving very slowly,
(in¬ implies that at the most onecluding, in the case of a nuclear third of the power is used for
power
station,
the
initial fuel longer than 6,000 hours per an¬
charge)
and
the
cost
of
fuel. num, and therefore this basic load
Figure
3
shows
the
conditions represents about 60% of the total

of

the

initial

which
would

have

the

establishment

nuclear

a

fulfill

to

it

electricity

equal

thermal

that

station

power

if

cost

the

produces

produced

by

is
a

station with
a
of 6,000 hours per

power

running

time

year.

production of electricity. Run-ofriver plant and thermal stations

using inexpensive fuels such as
mining by-products, lignite and
blast-furnace gas, are by priority

us

of

ment

station

for example, that

assume,

cost'of

is

a

thermal

new

$130

establish¬

initial

the

power

kWe, that the

per

for

reserved

United

the

Let

in

GWe

25

basic

the

Kingdom

reach

will

load

low

very

hydraulic

power,

out

takipg^ into

factors, such

basic

as

of

any

relative

the financial as¬

the different levels of
nuclear
experience
in
the
European countries.

pects and

^

Conclusions
To

some

which

we

studies
the

up,

during

that,

as

have

would
initial

of

appear

period
in

estimated

extending

growth

*

it

an

our

till 1965,

up

nuclear

energy

majority
of the European countries, by the
desire
to
gain knowledge, and
will -depend
on
the financial
means available — in great part,
will be governed, for the

public funds. However, in certain
European countries the produc¬
tion
of nuclear
electricity will
not

be

although for
whole it will
about 4% of the total

negligible,

Western Europe as a
not

exceed

production.
It

the

is

allow

will

which

gained
period

experience
preliminary

this

during

economic

as¬

pects to be determined with more
accuracy. It is probable that prices
will drop while energy require¬

of

will

energy

exact

course

it can be taken
entire total, pf

increase

ments

tional
The

in

resources

account

other

the. numerous

in view of this

1975;

country's

In

load.

the

maximum

a

chance

en¬

visage running times of less than
6,000 hours per annum. On the

that

higher * figure
has.
little
of being realised, since It
has been calculated solely,on the
basis of the load diagrams with¬
The

?

Long-term Forecast
view of the

in service in 1975;

nuclear power

on the
difficult

are

object is to deter¬
mine the exact point,at which two
power

the

for. research and per¬
fectioning* of power station types
would continue at its -1958-1965

a

primarily

depend

economic

nuclear

the

simplicity, the

1975, one could envisage that
programme

possibilities of
capital cost or rhythm, and that in 1975 the
a
fuel cost low enough to make < minimum installed nuclear capac¬
nuclear power stations' compete ity in Europe would be in the '
;
/
tive can only be demonstrated by region of 15 GWe.
These two figures, 15 GWe and
the experience acquired between
50
now and 1965. Thus, at the present
GWe, represent the" extreme
juncture,
long - term
forecasts, limits that can be envisaged for

seems

.

.

expenses

thesis, namely that* in many parts
of Europe, nuclear power stations
will still not be competitive by

com¬

practical

achieving either

In

including taxation);

Operating
insurance).

be

to

One

variables.-

five

v

financing charges (interest

Fuel costs and

is

of the advantages
of such a figure is that rapid and
successive approximations can be
made
for
calculations
involving

con¬

amortization of capital, fiscal

charges,

station

the

petitive.

of

factors

.

if

fuel

and

moment

at

conven¬

diminish.

resources

which

re¬

to nuclear energy becomes

necessity will vary from country
cents that almost the
to country between several years
U. '(5.5 this power will be nuclear. For
and 10-15 years. At that moment
mills/kWh)
and
,the
financial the inter-connected countries of
the
place of nuclear energy in
charge is 11%. For the cost of Continental Europe, basic produc¬
the
overall
power
situation in
nuclear power to be competitive tion
could
reach 440
TWh, of
Europe will be vital.
there must be a specific correla¬ which
275 ;TWh
should
come
tion between the cost of nuclear from \ conventional
stations
(95
♦An address by Mr. Perret before the
fuel and investment. For example, TWh run-of-river plant, 180 TWh third meeting of the Atomic Industrial
Forum, Washington, D. C.
if nuclear fuel costs three mills thermal
cheap
fuel
stations).
conventional

fuel

million

per

costs

55

a

T.,

B.

exchange

foreign

per

kWh, investment must be less
$250 per kWe; / if the fuel

not

only 1.5 mills/kWh, invest¬
ment may be as high,as $320/kWe.

power

This example is

tries

tive

of

tions.

average

In

fairly representa¬
European condi¬

United
costs only about

contrast,

States fossil fuel

could

only

the

other

still

European
abundant

have

PALOS VERDES ESTATES,

coun¬

sources

hydraulic power, it seems un¬
that
their
nuclear pro¬
grammes will be on a large scale.

of

likely

This announcement

be

to

achieved at the cost of very heavy
investments drawn from

internal

in

Hayden, Stone Branch

could not exceed 25 GWe.
the

Since

TWh and nuclear

165

exceed

could

production

nuclear

Thus,

than

costs

Calif.

—Hayden, Stone & Co. has opened
a branch office at 19 Malaga Cove
Plaza under the management of
Mrs.

Shirley R. Chilton.

in continuous

were

is neither an

offer
Prospectus.

offer to sell nor a solicitation of an

The offering is made only by-the

buy any of these securities.

Europe's

"

V

,

j

resources.

Production Cost of Nuclear

The

;

Decembers, 1959

200,000 Shares

Energy
Let

us

now

forecasts.

The

the

turn

long-term
factor in

to

decisive

development of nuclear power
on an industrial
scale, is

stations

of

conventional

at

the

same

would

it with

ventional

be

an

average

often still theoretical

are

con-^

particularly as at
moment nuclear costs

cost,

the present

from

now

will

until

1965

as

well

k

j

i

5c

Stock
per

Copies

of

such

Share)

Share

this Prospectus may be obtained from

other dealers as

may

the undersigned and from
this State..

lawfully offer these securities in

Schrijver & Co.

•

period

the

will

it

be

Netherlands Securities Company, Inc.

in

as

the
of

probable

costs.

It

.li

•

because

the light of experi¬
with power stations which
come
into operation, to de¬

possible,
ence

During

'

Price: $5.00 per

they cannot be based on practical

experience.

^

Common
(Par Value

quite pointless to try to calculate
an
average nuclear
cost and to
compare

'•

Faradyne Electronic?? Corp.

produced
place and under the
It

^

I:

energy

conditions.

same

'

r

*

undoubtedly how the cost of nu¬
clear energy compares with that

termine the cost of nuclear energy

represents

total

hydro.

per

investment

stations from

therefore;

of

of

cost

average

C

been

$5,000, million

kWe/' and

an

in

investment

stations

the

cents
per
million B.' T. U.
Therefore/ taking the most op(three mills kWh)in these, cir¬ .timistic hypothesis, maxim urn -in¬
investment v cost stalled nuclear capacity in Europe-,
should not exceed about $200 kWe towards 1975 could be - about 50
for the nuclear power plant and GWe.
t
1.5
mills kWh
for
the
nuclear
On the most pessimistic hypo¬
cumstances- the

from

natural

for

of

30

,

$30

operation. It should, however, be
borne in mind that this saving of

about

ing

[c. i. f. price $15 to $25
of the efficiency of
stations] could be

power

power

installed

oer

used to buy

the

capital

O.

the

Requirements

lished

out

year.

regards

construct

For

for

some

Capital

tions,

over

of

total

ton, 35%

20 to 30 TWh

a

during which nuclear energy will
contribute

Brondel

to

produced with imported coal, and

more likely, on
.of
the first period,

seems

average

TWh

32
per

yearly running time

average

a

2,500

conventional fuel, between 18 and

less

longed stoppages, in which event
will

same

show how such

of

$40 million

a

If this money were

operation
pro¬

electricity
that of a

*

with

power
station
purpose. I shall
comparison can
be made. The following example
has
been
worked
out
by
Mr.

built for the

of
to¬

rate

capacity

be

about

and

plant, making
$160 million a

It would be hazard¬

ous

may

harder

of its

cost

compete

costs.

addition, it
natural

fue]s

it

the

to

conventional

new

met

countries

of

sources

wards

comparison with that

if

were

capacity of 2,500 MWe. As regards

of

a

station would have to sat¬

electricity, both nuclear and

MWe, annual imports can be es¬
timated at about $120 million for

output

nuclear

a

with

capacity in
Europe. From the point of view
draw

!

have

riched

increase

provide

A.,

which

ity

(with

of total installed

and

attempt

an

power

European

The forecasts of the increase in

installed

of

S.

isfy

stations,
enriched fuel

power

energy

conditions

power

im¬
pact on the European balance of
payments. On the basis of cur¬
rent
projects we have assumed
that
by
1965
natural
uranium

In

Capacity in Europe

U.

;

of equip¬

Europe

especially

that

Comparison With Total Electrical

into

the

European

of Payments

nuclear

for

ment

the

of

Balance

from

a

nuclear

costs: of

should also be made to determine

Incidence

plant

fuels, on real costs and on
>erating methods. An exception

the

conventional

the

id

i'.

im-. tween

a .; very

concerned.

/obtaining

of

constitutes

portant market for the industries

21

is.

Herbert Young

& Co., Inc.

Morris Cohon & Co.
Roth & Company, Inc.

Richard Bruce & Co., Inc.

shorthow-

term

trend

ever,'

worthwhile at this, stage to-

•

ir». f

22

(2418)

The

The Commercial and Financial Chronicle

effect of reducing
treatment.

Capital Gains Tax:

the differential

.

.

Thursday, December 10, 1959

.

NEWS ABOUT

t

Limitations of Tax Considerations

Some

Misunderstandings
ably

that he is subject to

assumes

the special

to take advantage of
provision for long-term

a tax of only 25%,_ or $250, as a
result of his decision to realize

gains,

has

the long-term gain of $1,000 this
year. He would reasonably expect
a tax liability of $25,820 plus $250

mat,

he

be

to

"locked

in"

beyond the six-month hold-

even

ing period.
This

point

same

trated

for

the

be

illus-

or $26,070.

where

there

appointment,

may

case

net short-term losses.

are

that

after

offsetting

term

gains

losses

and

carryover

from

there

net

is

a

short-

any

against
also

Suppose

short-term

using

loss

any

previous

years,

short-term

loss

of

$1,000. This might have been offset against income with a
saving
of $300 in taxes. As pointed out

above, by taking the long-term
gain in the same year, the tax
liability for the year is S300 more

Under the alternative computation he begins with the taxable
income

of $60,000. No modification is made since the balance of

gains and losses is

zero,

of that

then

50%

of

is

zero

when

is

zero

still

the balance

combine

we

the

zero—

obtained

long-term

gain of $1,000 with the net shortterm

term

after

made

to

offset the full long-term

long-term

short-term
Modified

rp,

is
applied
effort has been

every

with

.gain

nel

deduction

gam

only

losses

and

losses.

8620

than

more

would

the

have had to

and 50%

$25,820

he

if he had

pay

hot

computation,

ff V lsno
no savetaX£aJeV
ihoie
than
25 /o

a^Xlnil|m

paying

m

on

a

paiticular long-term capital gain
he

yea

decides
which

in

to

he

long-term losses

realize
has

the

in

also

taken

net short-term

or

(a?tl?ally jncludedm the
nrprpt|:a 1Jn s
n* ??
The theory,of the
hvli! 10! 18 ^
?!
Tn.
income is first
,1 dlASregarding ihL:
nfg !a; 5'aTement
^ X
^ mr'
•S Sn hX
6 ™COn)?'
•fiX''
inXn
tV n)
~
1gain will
L be
re;.T
e term
net
used to
iX,

w

>Un,.r>.

r

tk

a

mean

would

91%

can^over

any
from the

The

years.

preceding five
liability is first

tax

computed on this "modified" taxable income. Half the "net
gain"

,amadldl

oarenOv

Lviml,
maximum

rate .of

os

taxable

regulai

tax

and

late

to

have

to

apply

the

net

tax-

sblciucouie. In origmally
arriving
of the

at the taxable
income, 50%
rri

The

been

•

taxable

tuithei

to

income

the

deducted,
is

extent

purified
of

again

deducting 50/,, of the

"net gain"
capital gain after
allowmg for all long-term capital
losses
and
all
net

(i.e.

the

net

capital losses).

Thus

the

91%

limitation

from

paying

long-term capital gain,
above
loss

examples,

offsets

that

we
corn-

pietely wipe out the long-term
capital gain. To the extent that tne
lo,s

falls

onset

short

of

the

Vin

i

from

overemphasis on
considerations.
The
capital

gains

is

tax

exception.

no

cially if we are dealing
widely fluctuating stock
must

we

main

chance

keep

and

the

hattan

action

to

tax

only

reasons,

if

the

price outlook is not substan¬
tially unfavorable. Suppose, for

instance, we
term
capital

realization of

second

outlook

is

such

the

on

long-term

le?S

the tax-

jn pie

regular tax bracket. Only
limiting case where the loss

offset

is

is the

zero

effective

decision

the

the degree of
to

risk

Since

sustain.

we

to

willing

are

the market may

either way, a
advantage

go

with

rest

must

delay

our

be

may

well

as

our

as

gain_

25% of the long-term
Thus
what
is
generally

gtated

as

a

.

the rule is actually only

limiting-

when

the

and

case

there

form

are

applies

only

offsets

zero

where

or

in

of

Iong-term
capital
bosses or net short-term capital
iossegi including loss carryovers.

chance ;at all, the tax ad¬
of delay should not be

any

vantage
allowed

to

,

siderations

ho

'

Bonds

Purchased

Below
The
SOme

caDital

in

the

paradoxically

a

tax

(ions. Thus

vWHs

considera-

tax

bond purchased at

a

a

discount yields a certain return
which takes account of the
coupon
and the amount of the
discount,

However,

the

current

generally taxable
whereas

come,

between

the

as

coupon

is

ordinary in-

the

difference

purchase

price

and

the value at redemption is
taxable

capital gains tax rates. Thus
yield net of tax is not eorrectly computed merely by applythe

yield.

It

is

to the quoted

actually

necessary

above "

i

return

snows

$60,000
any

example,
»
a

before

capital

let

us

M'"*
taxable

° -1oi'".
of

income

taking account

gains

transactions

of
or

loss carryovers. His tax
would be

$26,440. Then suppose that he has
a
$1,000 loss carryover from the

preceding

year. Since

toVadvanta"efs

suppose

he is at the

^^

.

.

1 thf case of municipal bonds,
yield.quoted is misleading in
? opposite direction. The current
retuin ls tax-free but the capital
„

is n°t tax-free.
not

actually

a

tax
820. Now he is
a

liability to $25
considering taking
-

long-term capital gain of
$1,000.

that

enough,

the

accorded

treatment

long-term gains is less, than ap¬
pears on the surface. Where losses

(long-term,

the

short-term %or

net
have

been

taken

'or

yield

of

amoVnt ** ls quoled'
bome investment advisory serv^ces 1Tia^e the necessary correc-

term

rate

on

a

^ treatment
Ai
ment

long-

capital gain for a person in
bracket is 25%
of the
long-term gain. He thus
his

tax

reason-




proposal
will follow

.

3

several

taking

the
in order to obtain the full

gains,
tax

before

years

advantage

of

President.

fective Jan.

Since
has

,|:An

State

the

holding
^

New

address

-

by Dr. Somers before the
Institute
on
Federal
and

Annual

1.

based,

however

Taxation,
York, Dec.

University
4,

of

Buffalo,

1959.

Vice-President

of

International Investment

Woodcock, Moyer
PHILADELPHIA, Pa.
Dec.

the firm

18

this

presence

paper,

of

Wood¬

cock, Hess. Moyer & Co., Inc., 123
South

the

Broad

New

Street,

York

Baltimore
be

members

of

and

PhiladelphiaExchanges, will

Stock

changed to

Woodcock, Mover,
Fricke & French, Inc.
John

E.

President

French,

Fricke
of

the

will

firm;

Frederick

become

Harry

V., Devoll,

B.

Jr.

and Marshall

Figgatt, will become
Vice-Presidents.

will

the First Naiional

office
The

in

Belo

new

be the bank's

a

Office

82nd in

Brazil.

Horizonte, the fifth largest
city in Brazil, is the Capital of the
state

of Minas

of

losses

*

Richardson,

Street, New York City,
of

Exchange,
Michael

&

the

on

M.

New

Jan.

1

Company's

banking of¬

new

fice in Rockefeller's Center's
Time
Life
Building, which
will

and

for

open

business

Dec.

bank's

State

office

14.

1956,

will

be

Mr.

by
John
Vice-President.

J.

being transferred from

facturers

Trust's

have

ratio

illness.

Mr.

President

of

Tierncv
Albert

Mr.

Milner

started

was

a

Vice-

ther

Law, Inc., New York adver¬
tising agency.

with

Manu¬

facturers

Trust

as

in its Central Credit De¬

a

page

Company

in

1934

partment and two years later was
to its Bowery Office as

assigned
a

Credit

Clerk.

appointed
the

In

1942

Assistant

bank's

Fourth

Avenue
was

he

Manager
Avenue

Wlth ^irchner' Ormsbee
(Socci:\l to Thk Pinanci\l

Chronicle)

Colo.—-Vance

the

is

now

the

&

Wiesner, Inc., 818

with

Kirchner.

Pr Miller
Ormsbee

17th

one

held.

announced

1,

was

declared]

1960

new

shave

The

stock

for

each

increase

would

be effected by an increase
capital from $40,299,500 to $80,-

of

599,000,

the

increase

to

be

trans¬

ferred from undivided profits.
The

terly

Board

also

dividend

share

able

the

on

Jan.

on

record at

Dec.

voted

of

86

a

quar¬

cents

stock

present

per
pay¬

15, to stockholders of

the

close of business

on

18.

The

promotion

of

official

new

of

officers

seven

positions and the

four

staff

members to

official status at The Marine Mid¬
land Trust Company of

Street.

Crocker

New York

Vice-Presidents from

as

Vice

Presidents

-

he

Assistant

South)

appointed

President

and

National

Department

officer in

18th

Street

career

United
Tru-t

Assistant Treasurers.

the

where

he

Mr.

Cun¬

to April, 1959,

charge of the bank's

Office,

Fifth

Avenue

began his bank¬
1,

1922

with

the

Capitol National Bank and

Company, New York, which
He

was

anoointed Assist¬

ant

Manager in 1933; an Assistant
Secretary in 1941; and Assistant
Vme-Presidenf in
1945,
and
a
Appointment

of

R.

Weiss, to the East Brooklyn Ad¬
visory
Trust

Board

of

Company

nounced

by

Fowle and

Robert E. Smith.

*

s;:

Mr.

Manufacturers
was

Mr.

York,

also

Flanigan.

an¬

C.:

of

appointment
Ernest

R.

■

Simmoirds

Jhe

Dec.

on

sit

Sit

Albert

Chairman

of

Bank

Arthur

Dickson.

Edgar

Gbigcr, Kenneth; A.
Presidents.

At

Simmonds

said

and

William

the

C.

South worth,
as

Vice-

time Mr.

same

James

J.

Clinch,

J.

Kenney were
Vice-Presidents,

Assistant

named

Jr.,
New

announced the
Austin,

2,

of

and Richard B. Tuttle Jr.

and Robert N. Kay was

appointed

Trust Officer.
.

#

Fred

E.
Hilgeman, has been
Vice-President of the U. S.

named

Trust

Company,
New
York
in
charge of operations. At the same
time, Elmer Witting and Robert E.
Powers

Assistant

named

were

Secretaries.
The

plans

of

Brothers
York,
Hoch, Mr.
Mr. Lester

Brown

Ilarriman & Company, New

Mr.

W.

Frank

Ireland

3rd

and

J.

Newquist, as partners on Jan. 1
has been proposed.
Applications
were
filed
for
approval of the
New York

State Banking

Depart¬

ment and the New York Stock

change.

Mr.

Brown

Hoch

Brothers

Ex¬

has been

with

Ilarriman

and

1947, and a Man¬
1956.
Mr. Hoch
has

Company since
ager

since

been

active

principally in foreign
Mr. Ireland,

investment

business.

formerly

Vice-President of. the
New York Trust

a

Chemical

Bank

Company, New York since it was
formed by the merger of the
York Trust Company, New
and

the

Bank.

Chemical

Corn

New
York

Exchange

Previously, he had been a
of
New7
York

Vice-President
Trust.

Newquist

joined

Brothers Ilarriman

in 1936

Mr.

Brown

and

Mandel

G.

George M. Fiske, Paul

L.

Vice-

a

Robert

were

Braunlich,

R.

merged-with Manufacturers Trust
in 1.928.

posts

Mahoney, Robert T. Schneider
and
Anthony Spero, all' former

of

(now

to

1956.

June

-

Collins, Eugene

J.

add

Office,

transferred

remained- until

-i'

Vice-Presidents'

went to Vernon E.

to

advanced to Assist¬

was

were

Nevin, Frank F. Stetson,

Walter A. Stoecker.

and

was

Secretary in 1946 and to As¬
sistant Vice-President in 1949. In

ningham, from 1952

Frar.k-Guen-

Avenue

for the past seven months.

was

Tierney passed away
of 57 following a brief

that

Office, at Fifth Avenue and 43rd
Street, where he has been assigned

ing

age

March

of

share

Manu¬

Fifth

Stock

J..

in

Cunningham,
Cunningham

Mr.

admit

William J. Tierney

Empire
January,.

succeeded

post

will

Rosenberg to partner¬

the

since

at 18th Street. He

the

in

Building,

York

ship.

William

Chairman,

to the
stockholders of record at the close
of business
Feb.
1, 1960 in the

Dec.

on

7, the appoint¬
ment
of
Mr.
Philip H. Milner.
Vice-President, to the post of of¬
ficer in charge of Manufacturers

1951

Pollak

annual

Staff members advanced to As¬

the

announced

Auerbach, Pollak
Broad

the

f.:

Flanigan, Chair¬
Board, of Manufac¬
turers Trust Company, New
York,
of

man

To Admit Partner1
Auerbach,

divi¬

approval of j

at

sistant. Treasurer

where he

DENVER.
may

payable

Geraes.'

.

Mr. Horace C.

ant

30

York

Dec. 7.

on

Horizonte,

Branch

Belo

Park

earlier sections

however,

H/Moore,

Elected
of Dec. 5,

City Bank of New York opened

is

Effective

—

name

Bank-j

New

stock

meeting in January and of the
Superintendent of Banks, William |

to

a

upon

stockholders

Assistant

As

the

Firm Name to Be

of the long-term gain.

pointed out in
of

the

September, 1958, Mr. Don- election

been

Chase

Trust
Sixth

announced

was

George Champion,
The appointment is ef¬

involuntarily (as in

of worthless

case

by

Vice-President in 1952.

lo'eli.rvieir.l'iT^lu'HeisS
that
maximum
the

are

Dec.

*

stock), it is
necessary to wait until
the fol¬
lowing year and sometimes even

at

tions. These

Bank, New York,

branch

Thus there is

tax-free

th®

reducing his

meeting

contingent

The stock dividend

the

Appointment of Russell H. Dorr
as
representative in Washington,
D.
C., of The Chase Manhattan

Brazil.'

members

T

of

the bank's annual meeting on Jan.
20 and if approved the new issue

is,

to

r

an

boaid

a

con¬

'

As

special

a

"lock-in" effect is greater, and the

at

the tax bracket

13,167,000

100%

a

Corporation, wholly-owned for¬ has been announced by George C..
financing subsidiary of the Textor, President.

rpflllirps

the

hi

strict actuarial basis

regard to

the

on

Milner, who has been in charge oi

o^ b^dTThe computaton
on

at

differential

Par

p-ains

cofrS ioT

Market

dividend

2%

a

Company,

eign

the

Cxtellt of

of

payment

bank.

period.

to'

in

,

•

£

practical

discussed

tions mentioned above is felt only
when the loss offsets do not
exceed $1,000 in any one year.
Tha< * the maximum that can be
taken against current income;
additional amounts must be carried over to not more than five
m^v

Code

the

Provisions

carryover)

VPirs

of

The result of the

-

have occurred

the form, of-loss offsets

decision.'

the

control

Significance

The full effect of .the consiclera-

fnpirp

used

be

stock

cannot take

we

tax

than

dend

capital

"

rate for the long-term capital gain
half the taxpayer's bracket and no
]Tj0re

Trust

declared

of

shares

new

Consideration

is

loss

the

The Board of Directors of

340

of stock
\yill represent, a dividend
likely to be accentuated by*-delay*' of one share for each 50 shares
we must carefully weigh the tax
held by stockholders on or about
advantage against the disadvan¬ Feb.
5, tentatively set by Chase
tage of suffering a further loss. If Manhattan directors as the
day of
there is merely uncertainty as to
record.
the future trend of the market,
i[;
i\i

then

Revised Capitalizations

•

ers

meeting of the bank's directors.

generally
loss to the
the market

that

be

has

Cloy, Chairman, following

would

deferring the
year.
But if

Man¬

will

York,

the issue of 263,-

stock

long-

a

Chase

The

New

askett to approve

loss of $1,000. Tax

a

considerations
favor

taken

of

Bank,

shares how outstanding, it was an¬
nounced Dec. 2 by John J. Mc-

gain of $1,000 this
are contemplating the

and

year

have

direction

rate

Stockholders

mistake of losing a big profit for
the sake of a small tax gain. It is
all right to defer an investment
for

New Offices, etc.

•

on

make

not

New Branches

•

with a
market
the

eye

our

Consolidations

Espe¬

disadvantage. Where the trend is
substantially in an unfavorable

tax

BANKS AND BANKERS

decisions

business

an

five

/a?\0iVe H10m }'hQ make two separate computations,
V f bls. al\ej/natlv<r one on the coupon and'the other
1
J1?,ls ,a ,Xr cry 011
capital gain. The yield net
separating out the full long- 0i taxes is greater than would
the^25'yPraLgaln 1 treatment at appear through the application of

■»nn-1
IT
fiom

tax

long-term capital gain, the effec-

sb^lT-term
jug
of the

100%

in

tax

him

save

used

without

that

25%

the

is made

purify
the capital

income of

element

gams

were

the

Quoted

"

25%,

\ Thus the first step is

he
the

not

on

jn

in

losses

if

bracket:

payers

...

.

alternative

wh ch ostensib y limits the tax to

that

hold

*ain ,wiI1 b?

Taxable Income

,,

The

the

He

zero.

computes
his tax on the full $60,000.
This
comes to $26,440. This tax is fully

loss

of $1,000. It must be'
emphasized that the 50 % long-

of

is

long-term gain, alternative computation or no. The same would

and

J;

'

long-term gain. There is
long-term gain deduction, be-

cause

it

dis-

have been, i.e. 30%

it would

the

rio

to

taken the~long-term
capital
gain of 81,000 this year. Thus he
is effectively taxed at 62% of that

than
of

He is doomed

in

made

come

Continued from page 3
means

Some of the worst mistakes that
are

of the In¬
Department

has been in charge

vestment

since

1947

Research
and

a

Manager

since

i953.

Mr.

J.

President

Marc
of

J.

Gardner,

Henry

^ tee-

Schroaet

Number 5906

190

Volume

heads

Schroder

nd

died

York,

few

1.

Dec.

on

la stern business for

fice

several years.

administrative

has

Bank

May
of

Mr.

York
of

McClure

Virginia

was

elected

June

letiring at the close of the year,
dr A. Edward Scherr, Jr., Senior

President
-

of Brooklyn,

Savings Bank

8,

President

/ice-President and trustee of the

Chief

Mr.

on

Oct.

since

joined

July

The

7,

Assistant

1945;

Dec.

7, at

He
on

Vice-

1949; Vice-

12,

Oct.

Bank

1941.

10,

Credit

1952, and
Officer on April 1,
w " '

Deane

joined The Bank of

on

dinner. Mr. Scherr, Virginia on Aug. 3, 1953, as
n
his post as Senior Vice-Presisistant to the President. He
ient of the Dime Savings Bank
Dec.

>n

a

New York, with asdollars directly

>f Brooklyn,

5,

Cashier

Assistant

on

'1957.'

the guest of honor,

*few York, was

The

elected

;ets of one billion

Vice-President

1956.

;upervised the substantial investnent portfolio ! of the institution.
Mr; Scherr Twas named Assistant
Cashier of the Bank of America

on

as¬
was

Dec.

L.

Quarles,' Assistant Vice-President,
is

advanced

to

Cashier.

Flowers

is

elected

William
Assistant

Cashier.
On

Quarles

served

in

departments
Feb.

in

that

and

7,

1937,

Tiller

Mr.

he

transferred

was

He

served4 in

Vice-President

dent

numerous

assignments,

was

to

promoted

Assistant' Cashier

in

Dec.

Assistant Vice-Presi¬
June 6, 1952. On Dec. 12,

1955, he was
was

Mr.

on

on

Dec.

6,

1957.

/

and

mittee

He

1958.
f

May 1, 1954,
resignation as

on

*

sale

of

common
.

Hi

&

President

of

First

National

Bank

of

St.

Louis,

*

*

new

increased

par

of

shares

value

outstanding

$10.)

ON TEXACO PROGRESS

charge of the Loan Department
1932, Mr. Scherr moved
i:o
the
Dime
Savings Bank
of

in charge of bond in¬
and was named As¬
of The Dime in

sistant Treasurer

Two views of

April, 1932. appointed Vice-Presi¬
dent and Treasurer in June, 1946,
and elected to the bank's Board
af Trustees in Dec.
;'

$

;

O.

L.

Si:

the

of

Chairman

Ivey,

Board

1946.

<:

■

Citizens National Bank,

of

Calif., has announced

Los Angeles,

in January after
with the Bank.
Ivey indicated his willingness

plans

retire

to

j7 years of service
Mr.
to

continue
Mr.

as

Ivey

President

member

elected

1923

and

in

and

Board

he

when

1959

Arthur came into being

newly discovered in quantity —

products for mankind. Produced in

products were kerosine,

simple stills, the first

naphtha, asphalt and primitive lubricants.

He

1953

continuously from

January

—

the

of

Vice-Chairman

as

into useful

of

member

a

Committee.

Executive

served

in 1902 to turn the black crude oil

a

1924. In
Executive

elected

was

Vice-President
the

YESTERDAY. Texaco's first refinery at Port

Vice-

became

Board in

the

of

he

1936

Director.

a

was

to

became

Chairman.

The

Security

Long

National

of

Bank

Amityville,

Island,

Y.,

N.

announced the

appointment of Mr.
to the Board,
succeeding Mr. John J. Ryan who
Peter

J.

Murray,

resigned.
'

Bank Item THREE

Herman

3

3

Maass, President of
Security National Bank, Hunting¬
ton,

H.

N.

bank

announced that the
approval from

Y.,

received

has

the

of Currency to
branch in Commack,

Comptroller

open

new

a

Suffolk County.
The

new

National's

office will be Security

on Long
presently has
eighteen offices in Suffolk County

Island.

and

twenty-sixth

The

The

Nassau County.

consolidation

Champlain

York

of

The

Bank

$25,000,

Essex

with

common

fective
charter

of

National
under

of

as

and

National
York,

New

stock of $25,000.

Ef¬

Nov.

the

the

20.

of

title

of

Under

Champlain!

Lake

Bank

the

com¬

with

County

Willsboro,

of

of

Bank

with

New

stock

Lake

the

of

National

Westport,
mon

into

bank

in

seven

Westport, and
County-.

Essex

Champlain National Bank, Wills¬
boro/

(Number

standing

shares

of

4,750,

out¬

$40

value

par

each.)
/

*

*

Manufacturers
Troy,

N.

Y.,

;

^

National

Bank

its

opened

of

newest

branch last weekend at the North

Country Shopping Center, Route
9, Plattsburgh, N. Y., just 18 miles
from the Canadian border.

New

drive-in

modern

bank

and

office

building of Elizabethport
Banking Co., Elizabeth, N. J. has

just opened, at 135 Jefferson Ave.,

Elizabeth, N. J.
❖

Three

Bank

Va*,

on

Dec.

dents,

4

were

United

advanced

to

of

C.

ultra-modern

11 other major Texaco refineries in the

chemical wizardry uses many methods to

improved gasolines, perfected lubricants, and a myriad
petroleum products. Because these products are so vastly im

other

Moseley,

President, announced.




bank

jet planes can fly faster and
industry can operate more efficiently. And because it has con-1
planned ahead, Texaco's growth has been continuous.

proved, you can drive a more
farther

of Senior Vice-Presi-

Herbert

Port Arthur, and at

States,

produce constantly

*

ranking Vice-Presidents of
of Virginia, Richmond,

The

the position
7

❖

TODAY. At

stantly

—

powerful car

—

TEXACO
CONSTANT
IN

OIL'S

FIRST

its

$400,000. Effective Nov. 24.

(Number
40,C00

stock

capital stock from $300,-

in 1926. In

Brooklyn

Mo.

in January,

in

vestments,

Com¬

Boatman's

National Bank of
Fort Lauderdale, Florida, by the

000 to

Senior Vice-

Executive

,

'

$100.)
$

elected
National

named Senior Vice-Presi¬

was

shares outstanding 5,000 par value

Wagenfuehr,

the

was

First

of

dent of First National

Fidelity

Albert

retire

Chairman

Director of

Bank

National

1958.

of

and

The

named Cashier and
Vice-President

made

Chairman

Assistant

Dec. 5,

will

announced by

Wagenfuehr

Vice-President

Richmond.

to

and
on

was

McDonnell,

of the Board.

on

!|s
t>
including that of senior account¬
ant, until entering military serv¬
By a stock dividend the Security
ice
in
October, 1942. On March National Bank of Enid, Oklahoma,
I, 1946, he returned to the bank increased its common capital stock
and became supervisor of the loan
from
$100,COO
to
$500,000.
Ef¬
discount
department. : He
was fective
as of Nov. 24.
(Number of

1949,

A.

10, 1953, he was elected As¬ Bank in St. Louis
Cashier. On Jan. 1, 1958, J olio-wing
his

joined The Bank of Virginia and

elected

31, it

William

numerous

city

23

Louis, Missouri,

Dec.

on

sistant

Dec.

.

Mr.

St.

in

Mr. Quarles has been with the
Tiller, Vice-President bank since July 24, 1949.
and Cashier, becomes Vice-Presi¬
Coming to The Bank of Vir¬
dent and
Comptroller. Robert J. ginia's Roanoke ^ffice as teller,

Cashier

.

NEWS

7,

(2419)

Mr. Moseley also announced that

William

H.

with

been

Virginia

a

1942.

ifter the first of the year.

Mme

S.

for

officer

of divisions.

the Board of Directors

►f the Atlantic Bank of New

de¬

John

department;

Mr.

Theodore P. Tsolainos has been
ilected to

who

May,

commercial

number

$

❖

:!*.

Joseph

bank's

McClure, chief credit officer, and
Frederick Deane, Jr., central of¬

Far

bank's

the

for

J.

are

the

velopment

Mr.

joined the Schroder or;anization in 1927 and had been
Gardner

esponsible

The Commercial and Financial Chronicle

.

.

They

Corporation, New York
Trust Company,

•sinking

.

PROGRESS

CENTURY

/teACON

24

(2420)

Commercial and Financial

The

•

Continued from page 15

depression

and

deposits,

investments, and thereby

Do Rising Int. Rates Cause
Inflation or Deflation?
build

to

to

or

buy

,

task

1956-1957, arid 1959 - he
Federal Reserve has applied the
brakes with considerable cauhmi

^budget

1953,

unemployment;

—a

banks

prevailing yield
erties is 5%
cost

existing

on

reLdon'increaSdcredit^amicur!

prop-

dant bank

the construction

and

with it. Yet in the publfi
responsibility for achieve
rests largely with tle-t

cope

supply, and is
deflationary. If a

eye

money

therefore

stability

of a sur- Federal Reserve
The practicil_■
result is that the Reserve author - <
ties feel impelled to accompli-h
^o^by moi^tary controls thm

budget deficit, instead

outflow

(aenands :and the_
tL ClpLm reduced

Plus, confronts the Treasury borrowing should be from non-bank
sources — individuals, pension

bre0™nfe tbe "mount needed to
£™» !LT
Jh Thus
;'"ance
g owtm
While
thenoimal
X? eOerdl
xtCServe
naS,

tag money; no new money is ereated.
By contrast, Treasury borrowing at the banks cl.eates
brand
tL/\v.o#rvvn

ing to accomplish too much, thfc
call forth more vigorous attacl by pressure
groups and polit
that

tafYattonary'' influence^"*^ 3

rates

at all times.

reserves

Jimands

Reserve action,

ported by Federal

P

^

In fact) Federal

and tions.

This step, if sup- powers are grossly inadequate

Banks

R

policy aptly labelled by Chan Martin as
leaning against

surely no one would seriously advocate
— this.
Another method of
preventing high rates is for the 1
Federal Reserve to provide abun- J®Q£y

a

rental property might
migut wen
well aeciae
decide
to build a new property when the

Thursday, December 10, 1959

. ..

prospe^ous^e^rs! Tjningdo^ebt op-atmns. ^t when thes^ope

main

planning

Chronicle

the

and

is

income
would

threatens.

compared

with 5% on the pur¬
chasable property.
The investor's
decision might be quite different,

sound
miinVi

From

the

hp
be

av

may

rnnrinHpH
concluded

that
that

as

a

a

Federal

There

automo-

in

serve

as

days, would have made loan

less'

available

much

at

higher rates.

'

.

.

:

The pomt ^^Dowerfu!' "attack

1 his uncomfortable, and almojk
untenable, position of the Feder iF
Reserve points up one of tie

policies with a
view to curbing price inflation,
The
taxation
and
expenditure

Programs^ Congress, being sub-greatos^econom.c challenge.

"increa^jig1 velocity

money!

of
production.approaches

capac-

The

inflation.

Metcaff

removing

■

should bring Federal Reserve to prevent price;

produce

goods

prices

existing
T+

*

.

JA

"

Un

'

the

pennomv

to

and

seS

able, banks and other lenders

at

,

,

June which

urged

and

incomes

consumer

validate

in re- the larger loan requests.

purchase

to

requirements

serve

as

or

a

possible

All this offset to such purchases.

prevent over-expansion.

half of it is

borne

whpn

needed.

nvPr

im^cTteT*

two

viewnoint

'

reasons

high

rate

demands

i«

in

w

pmnpnnc

alrladv

As

itself

shown

curtails

would

we

id I

mai y and Conclusions

the current boom, a huge deficit

rigid directives,-,|hey represented

il

n

Instead, there shoujd^be a very

In conclusion, let
as follows:

me

,|
summarise

(1) A gross economic fallacy is;
currently being propagated byi
.

,

.

,

nameiv

wlace

.

subsequent

the price of United States securi- and the first half of 1957. As an
^here, the Federal Reserve should ties at par or above. This pegging anti - inflationary measure, the

«

loan

depression.

This

,l|

•

that

have to endure the inequitable a first step backward to the 1942- ^bstantiaTsurplus. ^er^erse debt rige of interest rates causes
maladjustments that arise from a 1951 era when the Federal Re- ^dfd|emontpolicyis^well illus- modity price inflation.
depreciating dollar, including a serve was committed to support trated dunng the boom of 1956

b^

Uncle Sam
through the corporate income tax.

This

Otherwise,

lalnfi/

c,llvllvio

f.

esoeciallv

whhoi t

dom' Only time can tell.

Again in

on

cost

Ind

.n„

tinn«icPfr^f+n^g^ is re-enforced and stimulated by a
These proposals were opposed of over $12 billion is in process
Snto&lSS threatened JriSf r,smg disP°sition to sPendvehemently by Chairman Martin during calendar 1959; and while
tion.
Emphasis has been placed
A chec^'rei^ on such an infla- and Secretary Anderson — and an approximate balance is forecast
the unimportance of interest
"j11? development is - clearly rightly so. While they were «not
'^rv
a

u

p

the othei

mnnPvrnnH i

as

and theTe
Perh mf

goris

:.gP1ween mke®fT

Federal smother. For example, the Fed-

the

retain eral budget ran a $9.4 billion defilowering their usual credit stand- United States securities, and to cit in fiscal 1953 when the Fedards. Growing business profits explore ways of raising legal re- eral Reserve was attempting to

.

become fashionable

can

make the additional loans without Reserve

servIces at

...

„

nMhest basic

been°f^geJgoa's-Per^ps tfc

expenditures exceed
of

al

^uite ^flexible^caiinorat

bust' for loans to finance the same .(or about future needed monetary ex- inflation, fiscal and debt managenesf profIts and dross'Nirional even higher) physical volume of pansion by purchasing United ment policies-have actually
Prodimt
Patentlv these are not investment and of consumer pur- States securities, of varying ma- perverse.' They have fanned the
conducive condition fOTcom^?d- chases of Arable goods.
More- turities."
Also,: Congressman inflationary fires that the moneitv price inflation which thrives over, if loanable funds are avail- Reuss
proposed a resolution in tary authorities were trying to
when money
the capacitv

aid

driving yields too low.

fiscal, and

present well-integrated program of mow
on the Federal Reserve during the
be , changed- readily " to combat -tary-fiscal-debt management cor
past summer represented a real either " over-expansion
or reces- trol.
We now., have the technic 1
threat to effective monetary re-" sion.
Also, the Treasury has tra- knowledge and power to product

ol
turn
emfZVmlnt
generate still greater demand where practicable,

uroduSFon

payments

wage

are censure

^of loanable funds

coordi-

organized to realize close

-

,

recessions they

existing

M

limit inon'th^
amount of na1?o'n of
pre-Federal Re- debt management

™

li i rvU
l„t
abhor
high
interest
tight credit.
Also dub

and

price
/ditionallY been preoccupied with *
at; the
lowest
cost, business stability.
This, in tuih
amendment to the bill borrowing at .the lowest
in a new era of ec(
the 4%-% rate restncand
nomic
strength
and
welfare.
on"to'
Bit
price
ity, scarcities of labor, materials, .tion read in part as follows: 'It tive -contribution
the tragedy is that a lack of c(
1Lyv
01 idUU1' ™ienais,.
" business stability - to pi ice
F ;
the tragedy is that a lack of c(and services emerge. Buyers then is the sense of Congress,that the . business siaDimy.
,
,
,
ordination
among' Conors-.?
bid Prices up. Higher prices in Federal
Reserve
System,
.
At times, instead of assisting the
I Branch and the F«

As

eives^rise

turri

F

leve

^f^both'

optimism

nnd
under

that

Plane

on

TT^wt.matelv

In other words, an in-

reserves

*~Lta^P|xpS stra^against

and
,

-

totower

Lh

]

,,

,

^SOTlSPiiSLfZ

money

businessesrand''consumers leads to

The curtailment of

expenditures

are

fl^[fopP,

biles, and other durables are likewise
restrained,
although to a
lesser decree

Control

may

higher cost of credit, the reavailability of credit,, and
the
lower valuation
of
existing
income-bearing properties. ' Con¬
for

real

Wealthy.;,business expansion

duced

expenditures

Reserve

that

the

sumer

tatfket

reserves,
v

dangers

of

consequence

fViflrmniYi-

n

m

rising temperature,

resetting the thermometer.

+itxi-.+

powerful restraining influence on
investment expenditures. Planned
projects tend to be deferred or
abandoned

oe

a

'?"„dfer"dn,rd^triCteAd E&

tight

constitute

Tuet

of

comes

tSMwMerely

foregoing analysis it

conditions

money

price that

la^e

structure.

new

Vn'rtVi

then be

-

so rising interest rates register the

Similar

3

tnn

registers

eter

£££S%£SZ&
buJlding

dollar—a

can

expense

--

however, in face of a rise of pre¬
vailing yields to 6%.
Then he
could buy the existing property
for$83 333

Low rates

enjoyed only at the

is

a

corn-

.

(?) This fallacy is dangerously
insidious since its acceptance
.

for

both because
of

declinins

capital

Drices

assets

weakness

in

of

But
this

^iscai poncy—an even more pow-

PYistint*

the

management

areumwit

should

also

be

di-

rected to the

same end.
money conditions"" as being iden-V The question here arises: How
tical with high money rates
A can the Federal Reserve apply its
far
more
powerful
element '*vof ^po>versh of
monetary
restraint?
tight money is the reduced avail -\The focus1 of their actions is to

narrow

conception

of

"tieht

ability of loan

exert pressure

on the legal reserve
Position of member banks.
The
ing institutions cut back the sup- principal method utilized is "open
ply of credit.
They raise their mafket operations."
By selling
standards of credit-worthiness in United - States securities to nongeneral, refuse the least desirable bank investors they reduce both
loan
applications, reduce the !e£al reserves and demand deposcredit lines of other
borrowers,
dollar-for-dollar. The Federal

or

money.
In one way
another banks and other lend-

.

.

and

increase

for. loan

pressure

payments—especially

on the riskiest loans and types of loan.
The

intensity of this

contractive pres-

sure

may be varied by the monetary authorities according to current policies.
Pressure may be so
mild that only the rate of
loan expansion is reduced; it may be firm

enough
crease

it

to
in

stringent

so

ciinnlv

in

by

of

credit

of

V«v

is

or

the

_i

which

curtailment

that

^

—

cost

in-

loans;

be

may

mnnmr

prevent
further
the amount of

-i

*

supply

in

the

lace of strong loan demand.

Thus, in brief, rising interest
rates develop quite
naturally during the prosperity phase of the
business
of

cycle as a
increased demands

businesses,
ernments.
are

also

a

consumers

and

Rising and high

consequence of restriction
reserves
and
the

on

general

°f

loan

-therefore

be

may also raise the

percentage of deposits that must
be held as legal reserve.
This
steP is like a double-edged sword.
transfers excess legal reserves

tne

rederal

Reserve

n

om

4^

m

-

— —

4U~

t>

^

me

nanus

oi■ non-oaiiK

lineresis,

•

and it should have offered some wark against erosion ot the dollar,
chine.
All
intermediate and long-term issues and against business instability,
States securities—both bank and.to absorb part of the funds flow-/* (3) While the-arguments supnon-bank — could at will put a ing. to the capital market. -But porting this fallacy have a disarm-;
security in the slot and get back instead Treasury offerings were;., ing plausibility, they are almost
iegal reserve money/ The Federal almost entirely in the short-term completely erroneous.
- ,t ;
Reserve lost control of both the area — near - money securities
(4) The truth .is that high ip-;
amount and composition of its which were appropriate for banks terest-rates -are an integral parr
securities. Also, changes in the and which in general contributed^ of the prosperity phase of the
discount rate and in reserve re- to asset liquidity.
Now during^ business cycle, and more imporQuirements—the other two major 1959, . debt management is again' tantly, a part of an effective pn)instruments of control — became tending to nullify the anti-infla- .-gram of control of price inflation;
empty gestures. There is no doubt ti°n policies of the Federal Re- -by the Federal Reserve. Just as
^bat the ready availability of re- serve. This /time part of the dif- a thermometer registers rising'
serve money at low cost was one ficulty can be pinned to a lawr temperature,
so
rising
interest
of the factors responsible for the passed in 1918 which limited the rates register the underlying con-"
r^s.e °f two-thirds in commodity coupon rate on bonds to no higher ditions of large loan demand and
Priees between 1945 and 1951.
than 414%.
restricted
supply
of loanable
The Treasury-Federal Reserve
The Ways and Means Commit- funds. A heat wave cannot be
Accord
in
the
spring
of
1951 tee recommended no change, and broken by merely resetting the
marked the return of monetary Congress took no action on the thermometer,
sort of slot maholders
of
United
a

to required reserves, and it reduces ■ the-multiple of expansion powers, and discretion in their
^.ch the banking system can use, to the Federal Reserve. Since
build on the basis of a dollar of that time these powers have, in
|e£al reserve. If, as is more likely general, been used wisely and efln such a period, excess reserves fectively to foster business stabilfre
at a minimum and member ity and a sound Cdollar. It will be
hn
Ire
i.?

■»

a

matter

before

adjournment

in

September.- Many Congressmen
were doubtless influenced by the
misconception that a rise in in-

(5)-The

crux

of

the confusion

\[es |n viewing high interest

rates

terest rates would be inflationary.

mon^j!
conditions"
In truth, tight money
js a much broader conception, em¬

Until this rate ceiling is raised

bracine
^
o

i

n.

m

or
,

as

identical

not
u

with

onlv
^

"tight

rates

high
0

but

V VV

more heavily.

At the same time,
die Federal Reserve usually raises
the cost of such borrowing; that

1>

w

Relation

exceed 414%

1

to

Fiscal

Policy and

the

case

Debt Management

—

which has been

since the second quarter

PpHprai

its( Fstraints

on

pMerve

inflation

appbes

princi-

rtiht
w!l.
pally on the supply T"
side by hmIn addltion to Federal Reserve debt management into a positive- ft^ fV' am0unt of member bank
rell^ta,,lt to be actions, fiscal policy and Treas- ly inflationary role. Only short- 4^ reseaves thereby restricting
Reserve Banks even ury debt management must also term bills, certificates, and notes legal reserves« tnereoy ies _

is, the discount

rate.

mPn!hViSTO|Uni raie"i

at'

Now

most

^OW most

money-

One

high rates would

encouragement




"'T'l—;

pnv

lmtes

an

to avoid

or

.

integral part of a nro
gram
of
monetary restraint to
contain
commodity price inflation
as

Reserve Board

iCUUg

produced

powers

erful control-and Treasury debt which became

nrhwinM

of

^^AJlww-

ixii.y

15 iu ue icauzea.

wnen price

aW6^ n7 the Uederal Re- inflation threatens, the
Honl tif p'1V:llege:rJ^i°t as a right, budget should show a
ne

ration'

tpL?eSerVe^+ail^at times

Federal
surplus,
That is, tax receipts should exceed
expenditures so that Treasury obligations can be retired. This is

Serv®. cl®dlt to member
^ the Resfrve author!brakes with varvin«° 1^1?? thp tbe responsibihtv of Congress and
Intensity
When thev
nnnii^
^ President in planning exfirmlv commercial hantc if™
pendlture programs and taxation
alternant
alternative
e
but to
to rrn°
programs.
- Heaven help us if we
contract loans, cant
show

hantci

flt-u

budget

surpluses

in

11UL

cuxunouies

10

tne

amount of money and other highly
liquid assets, but also prevents the
Treasury from absorbing part of
the funds in the long-term capital market.
The task of the Federal Reserve to foster stable business and
a sound dollar would be a prodigious one even with full assistance,
from fiscal and debt management

—

^

surPlus, <or recording.a d
^
represents an even moi
^ ^
influence, on the price• 1
deFal
business conditions thai
Reserve operations.
(8) Treasury debt managemep
is a third potent influence, of
least equal importance \>ith. F •
eral Reserve actions.
At P1®.?. J
-under the ,4U% bond rate ceiling,

Volume

t-ionary.-

- •'

•

interest

actively infla-

influence -is

[ this

-'

1

v.

The Commercial and Financial Chronicle

Number 5906

190

r v

'

•

Morgan Stanley,
Lazard Freres,

'•

,

h-

/9) in the past, fiscal and debt
v&nagement policies have not al¬
ways assisted the Federal Reserve
in its
efforts to contain inflation
and to avoid depression.
In fact,
■yt ' times
these
policies
have A nationwide
underwriting group
dirked at cross purposes,
and
of 78 investment firms managed
have
enormously 'magnified the
jointly by Morgan Stanley & Co.
task of the Federal Reserve.
and Lazard Freres & Co. offered
(10) One of the great financial
challenges of our time is devel¬ for public sale on Dec. 9 an issue
opment of a well-coordinated pro¬ of $50,000,000 Credit Froncier de
gram ' • of
monetary - fiscal - debt France 5^%
guaranteed external
management control. Such a pro¬

Offer French Bds.

loan

could usher in a new era of

gram

strength and welfare.
More specifically, it could mate¬
rially raise the standard of living
economic

bonds

which
teed
and

are

as

France,

growth, and a sounder dollar.

aecrued

by

address

"An

to

5.89%

The .bonds,

of

payment

are

by

the

interest

.

to

to maturity.

t

principal

Republic

95V2%

priced at

yield

cur¬

of

and

about

Principal and

The French
the

franc equivalent of

proceeds from the sale of the
will

bonds
loans

for

dium

and

the

be

the

used

finance

to

construction

of

me¬

low cost housing under

Republic's

Special

bonds

not

are

prior to Dec.

15,

operation

the

of

Heads

by the underwriters.
The offer¬
ing does not represent financing
by the Ford Motor Co.

•

Group

on
Now With Black Co.

Ford Common Stk.

(Special to Ths Financial Chronicle)

Housing
A

Construction Program.
The

Blyth & Co.

redeemable

1969, except by

sinking fund.
redeemable on and after

PORTLAND,

of
317
underwriters
Blyth & Co., Inc., The

group
headed by

First

Boston

Sachs

&

Corp.,

Miller has

are

100%.

Semi-annual

sinking fund

at

$82

per

payments of $1,600,000 from Dec.

sion

to

15, 1964, to June 15, 1979, together

per

share

with

NASD

Dec.
tire

of $2,000,000

payment

a

on

15, 1979, are calculated to re¬

selected

The

is

shares

cents

25

are

Joins First Pacific
(Special to Thk Financial Chronicle)

PORTLAND, Oreg.

—

ment

111.

Urbana,

Illinois,

'

First

to

Pacific

Southwest

per

was

being pur¬

&

Equities

Morrison

.-i

Co., Inc.

"j

Kennedy Pres. of
Aberdeen Inc.:
election

The

of

Donald

.

::

S.

Ken¬

President of Aberdeen In¬
vestor. Programs, Inc.,
has been
announced by Charles L. Bailey,
nedy

as

"»

-

.

Ch

>

ItA

?; |PWBPP|^L

-ISri

i

of

rm a n

;

distributor of
Aberdeen

~

Fund Contractual Plans.

,

Il

a

In

*

addition,

I\ the exclusive
was e^ec^ecl

v

Directors

,1?

agement

p

>flH

Cor-

t i

o r a

L.

Man-

Babson

JP.

of

David

the

n

o

Donald S. Kennedy

A kitchen

.

follow¬
Vice-Presi-

Fund,

as

Burnham Securities

of

can

he recessed in

a

wall

or

A

cabinet.

phone that has push buttons instead of a dial for calling.

Aberdeen

ing his resignation
dent

phone that

of

sponsor

A

A compact

plwnc with the dial conveniently placed in the handset.

microphone-dial unit for "hands-free" telephoning.

Cor¬

poration, the mutual fund affiliate
of Burnham
&
Company, New
York
Stock
Exchange - member
firm.

'

■

:*

Starting in the mutual fund de¬

,

.

partment

of

Peabody

Kidder,

&

Co. in 1950, Mr. Kennedy became

general partner of Stetson & Co.

a

in 1955, moving to
&

Winslow, Cohu
merger - in
as a partner
underwriting and

Stetson ..with

the

1956 where.he served

in

charge

of

.

sales.

i,'.' V"

u

;

Scott, Stringfellow.
To Admit S. Scott
RICHMOND, Va.—On Jan.

1

S.

a

Buford

Scott

will

become

partner in Scott & Stringfellow,
Mutual Building, members of the
New York and Richmond Stock

Exchanges.

Shearson, Hammill
To Admit Partners
Shearson,
Hammill
&
Co.,
14
Wall Street, New York City, mem¬
bers of the New York Stock Ex¬
change,
S.

R.

on

They're being tested todayI

Jan. 1 will admit John

Shad

and

William

I.

La

Tourette to partnership.

Van Alstyne, Noel
Branch in Pittsburgh
PITTSBURGH, Pa.—Van Alstyne,
Noel &

Co.

has

opened

branch

a

office in the Law & Finance Bldg.
under the management of Theo¬
dore R. Buczkowski.

Jan.

1

Sprayregen

Broadway, New
bers

of

the

Exchange,
Bernstein
end

will
to

Robert

Co.,

&

26

York City, mem¬

New

are

models of

some new

telephones that we're test¬

ing in the homes of certain of our
customers. We want to

York

admit

general

England

.

discover what

Partnership in the firm.




telephones

are

also symbols of

exciting changes going

on

the scenes" to make the
still

more

telephone

(For example, millions of

phones, and what changes could be

tomers

made to

distance calls

improve them.

''behind

useful and convenient.

useful and attractive about these

can

many

now

dial their

direct.)

our cus¬
own

long

Some
more

But
els

BELL

TELEPHONE

even

you

may

have

phones in

if these

are never

went into

ways,

your

pne or

home.

experimental mod¬

put into full production,

them will be used in other

to bring you

continually-im¬

proving telephone service.

Bernie

limited

day

of these

the research and technical skills that

Stock

partnership
to

Exciting in themselves, these new

and

the customers themselves find most

Sprayregen Partner
On

These

different

SYSTEM

.

Corp.,

621

Street.

He

formerly with Zilka, Smither

-

."V.".'

-

.

Thomas E.

Pillette has become connected with

$1.55

reallowance

R.

with

Company, Inc., American
Building. He was previously
with Merrill Lynch, Pierce, Fen¬
ner
& Smith Incorporated.

conces¬

is

dealers

and

members

The

Laurie

Bank

chased from The Ford Foundation

t.

the entire issue..

share.

share net.

—

affiliated

Black &

Goldman,

Co., Kuhn, Loeb & Co.,

Lehman
Bros.,
Merrill
Lynch,
Pierce, Fenner & Smith Inc., and
that date at 100% of the principal
White, Weld & Co. are making a
amount plus accrued interest. The public
offering of 2,000,000 shares
sinking fund redemption price is of Ford Motor Co. common stock

They

Oreg.

become

the Annual Illinois Bank Manage¬
Conference, held at University of

before

-t

Woodworth

Professor

1979.

unconditionally guaran¬

interest

by assuring greater business sta¬
bility at a high level, more rapid
-

due

payable in U. S.

are

rency.

26

The Commercial and Financial Chronicle

(2422)

sale

BANK AND INSURANCE

purchased previously at discounts.
Taxable only at the capital gains

realized profits are added
to
capital funds or reserves. A
52% tax saving is obtained from
bond losses charged against in¬

BURRINGTON

LEO I.

gain

the

Later

come.

from

cost

Issues to the Fore

—

Bank Stocks

Bank stocks continue to be worthy
of investment portfolio considera¬

favored position to produce stead¬
fast earnings from
the inherent

tion

nature

complementary factor to
bond
and
volatile
equity
a

as

the

categories.
lescence

hazard

material

raw

the

around

channels.

the

of

Devoid
a

bank's

vital

at

work

is

money

in

clock

obso¬

owners

have enjoyed the healthy
achievements
of
their

long

growth

soundly

selected

for

Uiiformlty in Reporting
Earnings

■

...

Although industrial corporations
hold

sizable lead

a

banks in

over

lucidly

.

loanable

In

periods

of

marketable securities,
inducement to hold a
Federal debt
resulting limitations could well be
detrimental
to
U.
S.
Treasury
acterizing

through

other

sizable portion of the

also

sources

to

tend

be

uninitiated

the

1959 has

it

be

must

puzzling to learn that

developed into

for bank earnings while ob¬
serving the sizable losses taken

year

in

Another tax aid is

from their bond accounts. To dis¬

tax-free

pel the mistaken belief that

losses

bank

income

toward

acknowledging their obligation to
report
adequately
earnings
to
stockholders and the public they
will mitigate existing self-injury.
Until bankers standardize their
method of reporting

earnings, the
operating earnings now reported
can continue to provide the basis
for
sound
appraisals since dis¬
tortions

from

and

come

non-recurring

outflow

banks are
caught in a
from buying their invest¬

squeeze

ments

at

them

at

high prices and selling
low
prices, which of

does

course

needs

one

not

lead to profits,
recognize again the

to

difference

between

earnings

net

operating
reflect
coupon

which

only and "indicated net
earnings."
The
former
are
at
record

highs
but

cases

reflect

in

the

"Indicated

1959

latter

in

earnings"

the

of

bond

folio

be

can

the

bond

who desire mental

students

"indicated earnings"

cise,

described
and

after charge-offs, as
by amounts added to capi¬

tal funds from earnings,
dends

plus divi¬
point

declared. The crucial

in

keep

treatment

mind

is

given

diverse

the

in

bankers

by

Opportunity arises for directing
attention to one of the acquired
earnings.
to

even

by

bond

'hey

losses

and

banks

in

ties

With

two

commercial

main

primarily to
tomers.

earning assets,

banks

in business

are

loans

make

Investments,

to

cus¬

especially

those

disproportionate
tomers'
requirements,

to

cus¬

are

sec¬

ondary. Investors look for the best

performance

earnings

over

period of time. Loans which
duce

more

deposits,

administer and
of

loss,

have
test.

is

a

as

in less

those

as

the* highest rates,

pro¬

less

cost

result

well

a

to

risk

meet this

key to earnings growth
bank's ability to supply such

j

Apart

from

the

bank

status

stocks

of

are

the
in

enable

their
when

savings
one

another.
1959

1958

by
year

For

most

were

bond

was

lending

Man¬

power.

losses

have
low

been

selling
rates.

coupon

the funds

have gone

existing

bonds

Part

toward

higher

of

pur¬

coupon

securities at deep discounts.
They
have
seized
the
opportunity to
realize

future capital
gains for
building up earning power. Banks
sacrificing this opportunity often
reveal

week

For

loss

a

commercial

securities

on

deductible
as

loss

bank, the net

transactions

from

taxable

ordinary business

an

With

managements.

is

income
expense.

approximately half of the
recovered by the tax deduc¬

tion,

the

balance

generally

charged
gain

against

a

when

year

rising profits

NATIONAL

reserve.

bond

are

is

In

prices

a

are

realized through

AND

a

GRINDLAYS

LIMITED

imalgamating National Bank of India Ltd.
and Grindlays Bank Ltd.

BANK

Head
86

London Branches

54

13

oome

8 Meeds
Exchange

Members American Stock

BROADWAY, NEW
Telephone:
Bell

•ankert

to

Stocks




reserve

compared with
of

3%

under

to 5%

it

of loans,

a tax free average
today. Thus these

applicable tax laws have assisted
in strengthening the asset position
and

banks

•

reinforced

their

54

Parliament
13 St. James's
Sq.
Government in:

ZANZIBAR

&

St.

Branches

NDIA,

miner."

No mention

the

that

fact

A

ADEN, KENYA.

Mr. Uihlein is

partnership.

SOMALILAND

world

other

and

silver

everywhere.
to

the

any

the

increase

,

sellers,

-

A

10

cent

an

ounce

man¬

at

735

Tucker, Anthony
Admit J. Menges

cost

in¬

S.

U.

to

restore

balance

in

& R. L.

York

payments,' an
increase in the price
paid for foreign silver makes no

his

headquarters

Joseph W. Menges to
partnership. Mr. Menges will make
Boston

in

the

firm's

office, 74 State Street.

Warner, Jennings

curtail
to

to

New

York

and

Chicago Analysts Hear
CHICAGO, 111.— John F. Lebor,
Vice-President

of Federated De¬
partment Stores, Inc. will be guest
speaker at the luncheon meeting

Analysts Society
Dec.

10

at

supply

money

and

add"
the

as

—

Normally, when the price of a
commodity is increased, there is
a tendency for
production of that
commodity
to
increase.
But
a
higher price for silver would not
a

corresponding stimulus to

production- for

the

that the bulk of

comes

Philadelphia-Baltimore Stock Ex¬
changes, will admit Willard M. P.
Wong of Honolulu to partnership.

supplies

would

ary.

Partner

PHILADELPHIA, Pa.—On Jan. 1,
Warner, Jennings, Mandel & Longstretch, 121 South Broad Street,

which

Mining Congress wants
do—wotild be doubly inflation¬

mine

-

market

the

using sil¬

American

reason

the

increased

themselves paying

proposal

a

exert

of

bullion

allowing for markups.

more,

Thus,

To Admit New

members

silver

would find

ver

still

Day, members of the New
Exchange, on Jan. 1

admit

as

a

simple

our

byproduct

silver-

of

other

non-ferrous metals. In most such
mines the prices of

lead
important

copper,

zinc

or

cadmium

are

much

more

than the price of silver.

such

close

one

to

colors

1,500,000

for

be

and

ounces

into
products as
pharmaceuticals, dental

The importance df

stocks

time

.copper

as

Treasury's

silver"

fine

scientific in¬

high-temperature ap¬
in space vehicles,

plications,

silver is ideal.

a

goes

miscellaneous

mirrors,

the

portable

Also, silver

alloys,
plating, of
wires, medical and

surplus,

is

when

thus

"free

or

apparent at

regular

are

sources

inaccessible..

About two-thirds oi silver
sumed

con¬

by U. S. arts and industries
goes into industrial prod¬

today

Research is finding new uses

During World War
brazing alloys of silver
were
developed
by
Handy &
Harman. The automobile, the air¬
every

II

year.

new

plane

the telephone,

and

ample,

all

call

the

for

silver in

their structure..

demand

for

has

metal.

is

It

ideal

the

use of
And the

high-tem¬

soared.

Silver

is

in

silver

for ex¬

applications in guided
jet- and rocket aircraft

perature
missiles,

lining

corrosion and so

vessels and

chemical

of

versatile

and

noble

a

resists

for

metal

Silver
dyeing.and

cans.

nitrate is used in hair

making indelible inks. Extremely
ductile, a gram of silver may be
into

drawn

out

long.

Malleable,

beaten

into

a

wire

180 meters

silver

leaf

a

thin.

meters

graph

may Je
0.00025 milli¬

phono¬

making

In

thin deposit ot
employed in making the

records

silver

is

a

matrix.

Industrial Uses Growing
As

ceramic

batteries

equipment.

ucts.

and other products

ware

Stock

will

About

international

our

unnecessary

10C an ounce, consumers of silver¬

BOSTON, Mass.—Tucker, Anthony

pigments.

In certain

would

users

itself

said

are

in

pockets of a few big, struments.
lead - zinc - silver mining,

companies,

ing

ounces

users obare
used
in
making silver-zinc
which, would' batteries for jet aircraft, missiles
price of silver. Any and
portable
TVs; and silver-

well.

dustrial

1,000,000
consumed

silver

in
the
return or price
by U. S. mine producers,
of silver, they say, would causethe world price of the metal to-

the

con¬

steps

received

as

brazing
air

estimated to go into
electric contacts in appliances and
electronic equipment.
More than

_

Naturally,
iect

increase

A

in the form of solders and

sense.

observer

Coins

Steady Demand for

puts

it,

silver consumed
in U. S. coinage is large and the
ury silver has been running wild
this year. The copper strikes have need grows both as the population
and business increases, but
not only shut off domestic
njs
newly- as coins are worn
through circula¬
minded supplies, but also
foreign tion or lost. Actual consumptio
supplies, since customarily foreign
of silver in
Mint coinage opera¬
ores
and concentrates
containing tions varies in accordance win
the

industrial

demand

for

The quantity of

Treas¬

•

silver

treated in plants in this

are

country.

■

Several

Evans
On

Dec.

UGANDA

PROTECTORATE.
RHODESIA

1

the!

Officers
John

to

Mejlaender,

Secretary of Evans & Co., Incor¬
porated, 300 Park Avenue, New
York City, members of the
New
York

in:

PAKISTAN, CEYLON, BURMA, KENYA

TANGANYIKA. ZANZIBAR,

the

was

legislation, to the benefit of silver
miners

silver,

"some

ditioners,' electric appliances, air¬
made of ;
craft and rockets. About
19,000,000
price ofy
ounces
are

when the Administration is exert¬

ager of the firm's office
North Water Street.

uses

fast

alloys in refrigerators and

silver has been artificially affected
for years, due to silver purchase

copper

on Jan. 1
Uihlein to

A.

The

annual
consumption
of
about
30,000,000 ounces of silver by that
industry alone. Overall eorisump.

industry.
added, "artificially affect the
world market price, penalizing the

York

Exchange,

chief

good 25,"eliminate
a
special
000,000 or more ounces of silver
to selected buyers" in are
used each year in the U. S.
Sales of free silver, he,

MILWAUKEE, Wis.—Thomson &
McKinnon, members of the New
Stock

jewelry.

contain

taneously
sales price

$10,000,000 a year.
Of
the
latter
sum,
$6,500,000
would
go
to
foreign
suppliers,
including the U. S. S. R. At a time

admit Herman

the

for coins,

were

tableware
develenl
ment
of :
photography, including
motion pictures, has
resulted in an
and

freezing it by issuing silver certif¬
tion in U. S. arts and
icates against it and putting them
industries
during recent years has run in the
were done,
the silver would not be used for,' neighborhood of 90,000.000 to 10(k
000,000 ounces a year, but the pro¬
making subsidiary coins.
That is
the miners' purpose: to freeze the portion going into silverware has
been declining, thanks in
part to
silver.
the popularity of stainless
steel
At the September meeting an
while that used- by
industry has
officer of the New Park Mining
been growing. .
...f i
Co. proposed that the government •
Today not a missile goes aloft
pay western miners $1.29 an ounce
from Cape Canaveral, not a
"to encourage production of addi¬
jet
plane
from Idlewild that does not
tional needed silver" and simul¬

into

Admit H. Uihlein

will

of silver

£

and

ounces.

when

was

into circulation. If that

rise

McKinnon Will

tho
of 4 500

industry:

6,300,000

Time

all presently
which means

monetize
"free silver,"

to

ounces,

October

Con¬

asks

September

'

both

public

needs

and

the con¬

the

Mint

Bursa

-

venience

of

years

From time to time

•

•

SOMAEILAND

NORTHERN AND SOUTHERN

resolution

to

held

000

sentence

next

very

AMC

Again

In

ounces.

Treasury authorized sale

The

rise.

would

increase, while putting $3,500,000

of Chicago to be held
the Midland Hotel

PROTECTORATE

ADEN.

Bank

Depts.:

the

UGANDA.

5, N. Y.

7-3500.

Teletype NY t-1248-49

Specialists in

debt

bad

since

banks

provision to raise the

a

the

gress

Depts.:

Tax

Exchange

YORK

BA relay

includes

13 St. James's Sq.; Govt.
&d., Nairobi; Ins. Dept.: 54 Parliamenti
St.; Travel Dept.: 13 St. James's
Sq~ In-

STOCKS
Members New York Stock

commercial

from

of the Investment

PARLIAMENT STREET, S.W.I
ST. JAMES'S SQUARE, S.W.I

Trustee

ISO

Office:

BISHOPSGATE, LONDON, E.C.S

and

Laird, Bissell

tions, is obtaining strong support

agements able to absorb temporary

BANK

INSURANCE

proposal, which has separated
banking fraternity into fac¬

of

one

of monetary strin¬
1959, banks' sustain

loanable funds.

economy,

are

ability to sell securi¬

in

profitable

Mason

bank

on

in

which

The

the

doubtful

But
in the

With

times
as

even

tax

and

the

gency,

which

gains

loss years, while
bond profit.

With

g

investments

in

1957

n

banks

ahead, in time,

breaking

maximize

chasing

earnings plus character¬

out

concentrating

gleaned from the inherent nature
bank

laws

come

market

with

of

Commercial

by tax

them

reporting earnings. Although re¬
porting is obscure, much can be

istics acquired.

Bill

of

controversial

The

items.

off

Thomson &

Strength from Tax Easement

gains,

shown

to

be

can

net income

the total

as

exer¬

write

profitable for banks.

aided

earnings
made
to
reconcile
the
two
amounts,
analysts quickly have settled for
net
operating
earnings,
as
the
more reliable guide in following a
bank's
progress.
For
persistent

port¬

debt

practice of making additions
to encourage the

immediate

earnings growth.

in

losses

bad

to reserves and

of

of

with

are

Less

to
of

loans served to stimulate

ing

characteristics affect i

operating
figures. Before attempts

course

losses.

Many people probably have been
confused by the custom of report¬
ing "indicated earnings" along
net

many

lagging.

are

the

banks

amounts

for

reserves

on

obvious is the point that the tak¬

in¬

omitted.

are

mercial

com¬

limited

accumulate

revising outmoded bank
accounting principles can be
detected, especially by the larger
U. S. banks. Acknowledgement is
made to closely supervised opera¬
tions by governmental authorities.
Nonetheless, such agencies prima¬
rily are concerned with the pro¬
tection
of
depositors. As more

securities

being widely
In 1947 a

days.

permitting

ruling

tax

toward

selling

these

discussed

by

move

banks

financing.

banner

a

more

fluctuating interest returns char¬

reporting
earnings
to
shareholders, an improving trend

managements

hold

government securities than other¬
wise
desired
for
liquidity and

investments. Service income from

somewhat

/

.

increase

banks.

recession resistant.

holdings.

bank

provides the

to

banks

pledging purposes. If banks were
not aided in overcoming risks of

which

To
Lack of

for

cies

prosperity earnings can grow from
higher rates received on loans and

profitable

Knowledgeable

This tax treatment

climate

funds

world

the

price to stated value at maturity
is taxed at the 25% capital gains resolution asks that this step be
rate. Thus a mathematical advan¬ taken to preserve "the Treasury's
tage results. Every $100 securities dwindling supply of free silver
loss effects in time a net $27 tax for future subsidiary coinage re¬
quirements."
saving.

banking. Earnings can
rise in periods of recesison due
to stimulating governmental poli¬

of

lion

Continued from page 1
over

This Week

Thursday, December 10, 1959

Copper Strikes Bring Silver

rate,

BY

.

.

securities

of

redemption

or

.

came

ctete

Stock

Exchange,

Treasurer.
Ernest

sistant

L.

Lcmr

Secretary

Treasurer.

As

of

also
the

be¬

As¬

Assistant

in

recent

Treasury has felt it

use

desirable

its legal power to sell

plus silver to industry, but
heretofore
Demand
started

for

3,000,000
The

next

the

on

in

same

became

and

times

current

Treasury

March,

when

ounces

were

five

months

sur¬

never

scale.

silver

nearly

required.
demand

fluctuated between 1.6 and 3 mil¬

coins

anticipating

During the last 10
ounces

consumed
S.

U.

While
38.3
or»

subsidiary
this

million

+ nr»1

-fl

future

gives

fiscal years

3W

been
production 0
silver
coin*
average J>

an

ounces

tfl 1V-OC

nec^s'

of silver have

the

in

as i

stockpile,

for

silver
were,

million

make

the mints

a

l'3rt?P

yeai.t
flOm

*
^

■

Volume

,

190

Number

5906

.

The Commercial and

,

.

Financial

Chronicle
(2423)

million

11

Han

19586—_

^

in

ounces

fiscal

1950 to 60.4 million in

car

m

ivTan

T-'s
b. S. Subsidiary

1954.

f

*

Coins (Dimes,

Quarters ana Hall

Hollars)

(in millions of fine
1950_-

ounces)

silver

of

ounces

iluge hoard of silver

bullion

and

silver dollars now being
being
security for silver certifi-

as

This may be

done without

legislation.

I

1953—______—___

56.1

More than $2 billion of currency
in the form of silver certificates

1954—1

60.4

are

16.8

public py

17.2

the

1959_
Total

36.5

.___

382.6

—

—

in

the

Treasury
able to meet, its coinage

many

yejirs

forced on the
the strategic power of

western

for
For

circulation,

silver

bloc

in

the

cies

those
those

buy

silver

rniinfries
countries

Domestic
to

market, thus boosting the postwar price of silver.

Rather than

buy

silver

in

domestic

circulation

these

silver

certificates

are

and

ness or other types of coins.

Purchases

1950—

38.2

1953

35.7

1954

ReseA"notes!

The

?

V
free

„

The.

r.a
held

silver

..treasury, that

v

-/for transfer-into the tree silver

c=

L

u

by
the
the silver bul-

is,

IS? *£

ac-

7i7j

rrv,"

ii,«

e.-j

^ iave "o.

t
10.3

6.6

7.4

1958—

26.2

H

1959—

20.4

11.2

5

upply, future

j

lie
ne

needs

oi

U.
u. S; mints would
wouia have
nave to

be
oe

coinage

ases on the sll~

lrr! marvel.
market
pu
rer
ei

...

infc-it.

•j

I
In

mia-1945u the

ilver

'

*

,

*96-

in

million
.

-

,

ot

was

.

tree

nhmif
about

wae

'The

ounces.

...

ex-

stock

Treasnrv

the

g ilver in the Treasury
.

the

Total-

lend-

I()n

omlces, Congress passed the
econd Gfeen Act,
authorizing the

Treasury,

to sell

ndustry.

silver bullion

Substantial

.

to

industry

furthases. of Treasury, free silver
occurred

law

^ ions,

four main

on

snver

circulation.

The

jeasecj
i-CrtW4-' Vj

suc].,

couroe

the

nets

8,543

ounces.

*

"J.H'ic;

ounces.

U.nltt

Tho

Troocnm,

be

silver

re-

withdrawal
WHuuidWdc
first

were

Xreasury

markef

imited

omestie

(profit

dded

to

to

newly-mined
■

j

and

y

free

silver

by the end of

silver

„x

the

part

represents seignorthe Treasury)
is

the

owever.

lillion

for

silver

hereof which

books

when

issued

On

the

in

of
Ui

the

down to only 13.7
Since then, owing

was

ounces.

it

free-

xL.,.T„„

the

mrpose'

*

ilver

nncoc

Anf

Ullion

Sent

cni

had

mUlion
million

oCUTie 24
returned lendf

being
nnt

vpf

pnfprpd

account.

in

the

Treasury

on

th

an

to

U2q

mT

Were

ounce

sell

industry

"monetary

at

such

anv

urice

-mv

sil

less

it

a

But
y

are

a

(in millions of fine ozs.)

*

June 30*3945
June 30 1946

696

June 30 1950
June 30 1954

170

ary

dollars.

The

is

$1.38

cates

from

their

silver

10C,

25C

chalk

an

If

ounce.

circulation

a

and

in

backing

and

up

50C

coins,

profit,

the

as

19547-680—$

An

it

m.lPl?n

Thirty
the.

years

3,1 ounce'

piesent

last

ago

size

would

Coming

July

the

banknotes

nnn

y-v-f!

000 of large-Size silver certificates
nd Treasury notes of 1890 have
J,

Ac

x

rl

f

t

M

nilj;

,

be- enough

to

keep

]

fh

f

t

Yet hv law

f

some

has been introduced for the
which

would

au-

believed
oencvea

permanently

issue

would

then

be

certificates

new

silver thus freed.

The

lost.1

free

to

against the

tificates

are

If the

issued

in

new

the

cer-

would

u

X

tu

uestic

silver

'hots

newly-mined
turned

of

£re

to

over

newly-mined

-

3r'c%

market.

open

Deasury?receives
31

sil'wr
silver

npwlv-minpd

the

on

domestic

i«?
is

The
new-

Silver

Small

amounts of "silver
obta i ire d

ordinary,"

'""'ough

the

v

refining

of

newly-

'r"1 silver^account 6 added l° ^
'ce°silvcr^account'6
There is another

Treasury

may

way

by which

add

several




lost

for

authorized

by the Congress,
_

forei§n
luIugI1

governments
suvt-rmiicuiB

for
iux coinage

during the fiscal

purposes
1943-1946.

Having

in

under

1918,

silver

was

which

years

mind

the

monetary

sold to India with the

proviso that the U.

^

S.

would

re-

°! the mfal

after the war by Purchases on the
is. 1177,

HR5691

1

and

for

million

million

in-

ounces

of

HR6678.

much

been

replaced

Show

by

Subsidy

Saudi
to

first

23

have been

million

market,

Arabia.

industrial
uct

-n

gre

users,
able

the

the

days

gejj

domestic

^eir urod_

better

at

than the

for

Treasury's statutory price
newly-mined domestic silver

which

is

90V2d.

of

follows

as

Whenever

the

*
10.3

,

are

.

buying

subsidized.

availed

the

price,

That

they

themselves

the

of

subsidy is indicated bv the figures

13.4

——

users

also

are suosiaizea
subsidized wnen
when
are

the
tne

seps

unobtainable

silver

Treasury
Treasury

unobtainable

at

as

good a price.
are

the figures since

1950.

For convenience

0f reference

sales by the Treasury

inVus'try'a^shown

abalaUel

to industoy are shown in a parallel
to
in
column. Some of the sales were
made

to

other

re-

ecutive

Vice-

President

of

Wad dell

&

West

Ninth

Street, underwriters

of

United

Funds,
Inc. Mr. Burke,
member

Paulen

E.

Burke

of

Midwest

the

Stock

Ex¬

change,

was

formerly
President

Burke &

of

MacDonald, Inc.

Try

i

JLiXCliange

£ \YYY\S

^

..

(jOVS. MCCtingS
0

1-2—Dallas,

Texas,
Ga.,

at

the

at

the

Atlanta Biltmore Hotel.

Sept.

ounces.

October

23.

N.

in

the

summer

due^tcT^he^'drfa'y

■

of

12-13 — Fisher's Island,
Y., at the Fisher's Island Club.

rival
1 ,val

in

Suez

Canal

of

London

1955

Wood, Struthers to

^de- ^mit Partner

in the

ar-

Australian

Wood,

Struthers

c,

„

&

Co., 30 Wall
""T.
"TtZ
0."
Z
silver because ol the closing of the Street, New York City, members
well

as

due

as

to

strikes.
Silver
Be

Five

in

Worth

The
maue

Pieces

Cent

Extracting

ordinary
la-m

ui

v

,

Jan.

will

1

Stock

admit

Exchange,
J.

William

Midd.endorf II to partnership.

Sometime

"nickel"

cuppci

May

,

of the New York
on

coin

auu

is

Corbus to Be V. P,

ux

ment

to

35%

oI

and

9%)

issue 50 pieces composed
i i v e r, 56% of copper

s

Nearly 49

of manganese.

Til'

*

(Jf llimOlS CO.

government

agen-

CHICAGO

111

As

of

Jan.

1,

A11,
Josephus R,.Corbus will be elected
'

Vice-President
of
the
Illinois
coins fr?m Company, Incorporated. 231 South

million fine ounces of silver were

used in makin& such
to

1946.

Such

coins

^'d

Following

Paulen E.

[cently been

May 9-10—Atlanta,

$43 million and most of them are

fiscal year

—

Burke has

Feb.

for Treasury purchases of newly-

or

Mo.

Sheraton Dallas Hotel.

9.9

-

mined silver. Industrial

otherwise,

CITY,

ings in 1960:

0

well^ aj^ecejiUy^ Large

1943

them

^

nrirp

Treasury's

mines

KANSAS

7.5

To the extent nickel. The wartime shortage of
i<? 1p« than
those metals caused the goveinmat tne marnet puce is less tnan
i03,,o
nihepc
cnmnn?pH
markpt

t-,

sociation of Stock Exchange Firms
has scheduled the
following meet¬

to the Treasury.
thp

,

PiITkP p,YPP
V
P
-LmilVC UACt. V . X .
fYf
AA/Vlflflpll
"RppH
v/1 VV dUUv/li Ou IvvtJU

The Board of Governors of the As¬

ounces;

Copper strikes caused heavy de¬
for free silver sales by the

Treasury

market

0pen

'J.O'is

Treasury

thf
the

of

mand

Mining

shortage in the sil- ?s„

when

rn-ice

re¬

was

_______

$ Through

Industry

Yer

^

ounces

5.8

as

latter figure

the

years

*

in shipment and hence are
return.
No lend-lease silver

At times of

have

\
As

J ^r^e^torv experience With the. Pittman Act
of

bullion

Data

that

2f..S!SlSf
th®.U' S- lend"leased nearly ,4"'
-ho'Vmiiie^"«Smav°de -nancf of^the mdbon ounces
silver to eight

>easurv
casury. *

172.5

Returns

the

limited.

course

slIe,h.tly. over i

the
Lend-Leased

do-

divided

's to the mines' advantage to sell

be open to the Treasury.

Wartime

in

1955-56

procedure
m

as

The

in millions of fine

market price is less than that, it

and

mentioned in the above paragraph
1J

fiscal

$10

$5

tee

on

{i)

m-nes

be

India

India

Treasury to write off,

effect tne
the certificates
etiect,
certmcates

million

13.4

the closing of mines, smelters and
refineries
by
strikes.
Sales by

88.1

to

the

enough, we may see
schoolboys prospecting for silver
piggy bailkS.

a

October 1959 and is attributable to

ounces; Pakistan 53 5 million ounces,
dia.H portion has all been returned.

veL

denominations,

eignorage

Original loan
l-etuni
as
follows:

has

notes

31,000,000 standard silver dollars

to

corded

4104

(ti

If

rises

Reed, Inc., 20

.2

|22.3

Kingdom

silvef ^'nickels"

iu.

1956-57_

redemption

these

Arabia__________

/>..

5.4

56.7

Total

were

98

The additions to the
(Treasury's
silver stocks arising from the

Saudi

a

the

government

from subsidies since 1878, has the
nerve to complain that "Treasury
sales of silver are interfering with
the operation of the laws of supply and demand."

ounces.

|226.0

United

will

at

use

[appointed Ex¬

bought about

.3

Netherlands

x?_„

worn

higher price for it from the

ounces

;

India

•

withdravv

the

from circulation

from the Treasury. Monthly sales
have ranged from as little as 2,000

11.8

Belgium
Ethiopia

due

Treasury

Treasury May Replenish

v.iHK

help

Treasury Sales to Industry

(in millions of ounces)

not

55

194

inHnstmr

P'fntsto
silver

in

are

From mid-1954 through October
1959 industrial users of silver have

Silver Shipments, by

Australia

exist .which

Several

(later) ob.iect
to the Treasury's selling to industry at the same price. Silver mining, which has been benefiting

dimes,

Countries

this

of

in

us

Machines

njeoPg

Treasury they now

»

•

may be Considered lost. Yet by law
lhe Treasury is holding for the

to

173

__1

complain that Treasury

m

a

101

largel'-size ones- Now> a
generationloro'o_ci7P
letef,..more
than $31,000,cilxroi-' norfif'ipQf

in
in

million

ounces

Fiji

Unsuspected Windfall

Administration

Its Free Silver

ho

lend-leased, 37o

i ?

used

making

212

Oct* 22 1959

i

21 Se on} m!}!!olvget

the

difference

between $1'29 alld $1'38

thorize the

14

__________

June 30 1958
June 30 1959

i

,

llinn

m

?,?£, bece.V'fturned by Sept. 30,
?,?•'
ale on'y ohout 14

"mone-

16

Dec. 31 1954
June 30 1956

bearing 50 pieces are identifiable
by a large letter P shown on one

to industry because, by a law they
to
iiad pUt on the books, they could

Aicd&uxy

•

J.1 1

-na"

Treasul'y withdrew silver certifi-

f

Ui

an

value'J of silver in subsidiary Lend-Lease

lation

219

June 30 1957

iow the

silver

ard

containing in the aggregate over
24,000,000 ounces of silver. Legis¬

Selected Dates

coins will be profitable. The silver-

ounces.

tncy ao. it is ironical to near me
miners
complain
over
the sub-

so

and half dollars for about

t

its

at

$1.29

Treasury

®

processed

not yet entered

A

snvei

Silver

free-'

io^q

still

30

fmp
nee

ree

oo

xlvwi h
ounces Of

"nse-Sliver

194
la4:

was
Wab

.

nn

^^^^

Treasury's

SUM
P v

1llimi

•{

'^raus!"11VH

,

price goes, the closer
the time when melting the

side.

'"auvu

lower silver content than stand-

the

the return of silver by
govern
tents to which it had been

lend!

T

coinage; or

' ld K{?inciirrinp
tZ Treasmv^s sub
CoinagJ
^
another

account

stock

1954

higher the

30.7

Under the
1946 Act almost
10 separate*"silver 7nd,!'nickel "*50
much silver
has been

free
s p»nri
veJ is,nthowever,
drawing
to
tho

the

therefore

entered

^alue"' of

o

'

.*"w

?nd buy silver tor

from Pakistan,
' created after the war, assurne(* Part oi India's silver debt,
and SaLldi Arabia' which owes
some 21 million ounces.
The 35
million ounces sti11 due to be
iurned by these two countries will

^ijvfer

coins

n.Al,}jfl,

But suppose the market price of
a few more cents? The

iounces.

times

}t seemed to some.

it.

reserve

monetized

was

wou]c|

rabia and France.

ree

luaay

handle

to

esti¬

one

mate.

With the re- sidizing of silver users with silver
There is nothing in the law to
°JL lead_lease silver, by June the Treasury acquired in subu-,«
+vnm
1959,
the
free silver was again up sidizimr the mines. Silver which
prevent the Treasury from mith.
with- !yo%ine *ree silver was again up sidizing the mines. Silver which
drawing silver certificates from
f
t
source the mines were unwilling to sell
numninfinn
Thn
oiierav.
°i ^Venlenis}mTentCeS'
1 eplemshment
of
Treasury

occa-

when, market supplies were
I educed* by:;strikes or by heavv
purchases for coinage by Saudi

287.7

*

H

arfrcle, these had shiunk from no
219

n,hA"

°

ge

wmcn

wants

0ne

'certificates

,

j| casing, ot silver to allied'governj nents
waj not yet completed. In
| uly 19*ti. when the free-silver
^ tock was down to about 216 mil-

recovered, according to

Unfortunately, the Fed- million ounces in mid-1946 to only bought from domestic mines as
System may not issue
f million by the end of 1954. With has been sold by the Treasury to
Federal Reserve notes in $1 and the Mint Bureau consuming'silver industrial users and other
govern$2 denominations. It would take Ior_eoinage at an average annual ment agencies.

no

than 150 to get the $11.5,

more

comes

eral Reserve

j<jle in government vaults because

in the cost which would

silver rises

i'eturn

count.

Vj

u

of replenishing

way

is

an¬

"nickels." The refining cost alone
might be 3d per ounce of silver

15.5

mo

^lautitea end the Tieasury^should

ljes

The

worth of silver out of 20 wartime

34.7

Miners

/

r

There

content?

emailed

cost
1

1956—

515^million

.ounces of silver would bfe released

I'm Mid Downs of Treasury's
Silver

Of

j

,,

metallic

U*

1955.

1957

ahnnf
cornier

in culling the silverbearing 50 pieces from circulation
and shipping them to a processor
for refining.
It probably would

«

.,

nlus

Whv'are the coins
Withdrawnfrw

be

X

33.7

rontain

„,s„„

manganese

swer

Sales

Urn

nieeec

nothing illegal about it.

1.6

38.8

5d

th"n „0f b|fns

their

1946)

38.1

—_

1952

of the lend-lease silver
as been
rep- moreover
rescued the Treasury
ceds bj
di awing on free silver resents silver
certificates
of $5 fi'om a corner into which the sil—
.1
its General Fund.
It has not
and $10 denominations. If all these vei'
mining
interests .saw
the
ad to go out into trie open mur- gg
jQg
reDlsced bv Fed- Treasury being driven,
et to buy. silver.
;
•
eraf
Hie
As shown in the table of free1^741,000,000 ounces of silver.
this, about 515 million ounces

others

31,

Fiscal year

1951

the r market,
lend-lease
debtor
countries decided to call in coins
from

and

July

(in millions of fine ounces)

Dut it did not work out that
waY-

industry
of

wartime

$1 15 worth of silver

and

new y-mwed silver pur-

(Act

of

the

on

purposes,

aliases and sales by the Treasury

have
have

amounts

experimental
■

countries.

wnnlH
would

substantial

for

the manufacture of medals, etc;

Congress, particularly in the Sen- thereby accumulate the silver they
ate, under the silver legislation of were obliged to return to the U. S.
•1878, 1890, 1918, 1933 (Executive In Place of the silver coins so
Proclamation), 1934, 1939, 1946, withdrawn those countries issued
etc. Earmarked as special
security oither silver coins of lower fine-

49.4

_—

_

48.0

—

silver Senators

II

Apparently the Senators believed
that
that

new

1957—.,—
7

the

War

days insisted
that the silver lend-leased be re-

to

30.9

__——

World

held

56.3

—

of

standard

1952__

—

market,

open

coinage of "subsidiary cash or for
£ale t0 '"dustry. It may tap the placed by the recipient

1951___—-—______

1955__

■T\

million

to the stock available to it for the

cates.

10.8

—

hundred

27

to

a

totaMare

still_# outstanding.
_?j
#

nickels

bearing

weiejsTOtoeTf
These

silver- Exchanges.

aie a poten la

f{^rC ThosTnow^utstanding

(SpRiial.to The Financial Chronicle »

SAN FRANCISCO,

Theoretically, when the market

Calif.—Patrick

J- Shanahan, Jr., Homer R. Trow-

silver is 88.90 an ounce, bridge and Cecile Winters have

Price

silver

ounce.

D^mpsey-Tegeler

con-

trin
of silver.

0f

^ gade street, members of the
York and Midwest Stock

New

now

is

about

91

npm,wev*pX ^ZTTo'" "'"h
25^ S
Tegeler & Co., 2
an

This means that 20 of the

Street.

^

^

28

Now
SAN

The Commercial and Financial Chronicle

(2424)

of Texas

Capital Securities
Tex.

—

subordinated

BY ROBERT E. RICE

1983.

EITHER PROSPECTUS

these

In

first

FREE ON REQUEST

-

tasted

*

investing in

blood.

a

|!

list of securities selected for

J

possible long-term growth of

Their

I'

capital and income.

investment

managers and the brokerage fraternity are
talking quite audibly about the so-called bread-and-butter stocks
oils, which have found some slight support in recent days;
the steels, which have shown considerable bounce at
every emer¬

—the

of

gence

months

three

El

2.000

Hercules

Gas,

Powder,

the

prospect of labor peace, and the railroads, which
figure to benefit immeasurably not only from steel labor peace but
/ an accord with employees of the carriers.
.v
A V- By now it is no secret, of course, that fund managers have
'

Incorporated
Income Fund

sssafrat"" Y°™s"
town

Sheet

&

*

*

*

"

'

I

A mutual fund

investing in

a
'

I,

list

of securities for

current

fund is available from

I

your

J

200

I

.

I

1

The Parker Corporation

J

Berkeley Street

Boston, Mass.

General

*

as

it did last year and two
years ago, but
sixth from seventh, Socony to

Texaco has moved up to
eighth from ninth and Phillips in

the ninth slot has held its
the

eighth spot of two

own

from

ago to

years

a

although yielding

year ago,

Socony.

It is not until
you get down to the fifteenth most favored stock
of the institutions that a real
blown-in-the-bottle

glamour equity
to be Blue Chip International Busi¬

turns up and then it turns out
ness

Machines, which has risen

No. 30 two years
ago.

to No. 15 from No. 17 last
year and

Probably even more striking evidence of the high esteem in
the fundamental stocks continue to be
held is the rising
popularity of the kingpins of the steel industry—U. S. Steel and

I

the

-

Back before the

days when mutual funds got out and
of shares at
quarterly intervals,
cyclical stocks. The rule of thumb was

its mills.

After

casville

enable

to

World

like

eight

to

ten

S.

Steel

times

earnings in appraising their
priced to yield about 9% as
recently as 1953. As recently as 1957, U. S. Steel was no
better
than 26th in rank as an institutional
favorite. Today it is tenth.
Over the
as

a

a

span, Bethlehem has gone from 53rd to 34th. And
of the investment status of the
steel kingpins, U. S.
is priced to yield around
3% and sells at 20 times earn¬

now

stocks selected for investment

quality and income possibilities. Mail
booldot-prospectus,to

Sixties, but

,

much
-

CALVIN BULLOCK, LTD.
ONE

WALL

1894

STREET, NEW

management

Prospects opened

*

this ad for free

Established

the latest nine-month
earnings).

on

Portfolio

mutual investment fund of diversified

YORK 5

was

same

ings (based

common

U.

measure

Steel

is

and

of

even

trustee with

a

stock

a

isn't likely
by the oncoming

up

that

sells

at

to

*

of

nerves

90

its

iron

back

the

on

the Golden

and

age

take

can

just

so

times

earnings and yieids the
he must be to the tastes
investor, he can hardly banish the specter of
people
rushing to withdraw their savings to
buy U. S. Government obliga¬
tions that yielded 5%.

TLest
^rac^?n
of the small

!%• And sensitive

Graham-Paige Corp.,
end

investment

nounced

closed-

a

company,

common

an¬

stockholders'

equity at Sept. 30 totaled 13,066,692, or $2.16 a share.
This com¬
A BALANCED

FUND
bonds and

of

investing in
preferred stocks

selected for conservation of

principal and current in¬
come

and in

selected

common

for

stocks

income

profit possibilities.

with

pares

and

-

equal

majority-owned subsidiary, report

against $432,292 and

-

share the year previous.
*

A

An

Equity

Fum
marily in

investing pri-

common

selected for possible
term

stocks

long-

growth of capital and

:!<

secondary

000 shares

*

offering

of

($11,660,000) of

440,-

Vance-

Wellington Company, Inc.
Philadelphia 3, Pa.
CP
Check

one

Oct.

in

group headed by
Jackson & Curtis.

$26.50

per

share.

underwriting
Paine, Webber,
The

□ Wellington Fund
□ Wellington Equity Fund

ADDRESS

none

for

price

The shares

selling stockholders

was

were

S>

.

share.

This

$9,181,367,

or

__

$21.29

compares with

earlier.

a

$5,vear

v
*

*

of

common

stockholder

cash.

Both

Jan.

distributions

11,

to

are

stockholders

of record Dec. 11. This is
the first
time stockholders have
had the

opportunity of receiving, in stock,
the distribution from realized
net
gain on investments.
'

$

President

and

fleeted

the

tional

:J;

Roue

Price

declared

a

asset

Growth

$9.95 of

value

a

Stock

of

sj:

per

7.5%

share

was

from

the

year

from

rose

distribution

.J.:

/a

4

v'/

./

_

,

4.

-

JDa-rt/1© t U TO

:.Vttv

.

n/:

•

1

1T16CI 12LHd©T

• .1.

;

_

■

.•

..

/

.

.

.

v;„

,

members

the

of

New York arid
on

A

to. partnership. Mr,

Friedlander

Friedlander has been

an associate

of the firm for some time.

.

addi-

TPlllC

"Dl-nyN-f£>IU.Ill'
1

\

AA/lll

JLjIIIo

• 4.

VV 111.

m

TTAv>rlw A*

Adllllt

llGllQriCK

VjT.

Net

$13.93

share

per

-

111.

CHICAGO,

\

Blunt

—

share.

a

assets

Fund,

Inc., reports net

from

rose

31,

1958,

Oct. 31,

1959,

and Midwest Stock Exchange,

^

^

Puritan

$54,018,406

on

$71,181,437 on
increase of 32%.

an

'

With Merrill Lynch

increased

.■

in

shares outstanding increased 16%
from
Oct.

7,736,124 to 8,945,485.
31, 1959, 25.5% of net

On

toThe Pinjncial

^ *
is

a

year

$

of

i|!

the

Fourth Street.

million

Fund's recent

aware

BROAD STREET

INVESTING
CORPORATION

Dela-

buying activ¬

A

largely of additions to
holdings, reports D.
Moreau
Barringer of Delaware
Management Co., Inc., the Fund's
distributor

th

consecutive

quarterlydividend
from

invest¬

and

adviser, in its latest semi¬
monthly Directors' "Letter."
the

selling

the fund
position in

Philadelnhia Electric and the last
of its Merritt-Chapman & Scott.

Barringer comments that despite

investment income

A

SHARE.

Year-end distribution from

side,

minor

a

net

14 CENTS

ment

On

Mutual Fund

Diversified

ity has been directed to taking
advantage of tax selling pressure
on
securities priced considerably
higher during the past year or two

national

;

-4

—

i]i

$86

Pierce,

Incorporated, 41

Smith

ago;

represented by com¬
mon
stocks amounting to 74.5%
currently, and 81,5% a year ago.
was

Most

&

gain realized

on

24 CENTS

A

investments.;;-

SHARE,

.r,

Payable December 24, 1959
Record Date December 4, 1959

continuing
huge backlogs a n d
some
degree of recovery from the
1958 recession,
the latter seems

■

,

65

Broadwav, Ne

v

yoi-k 6. n.

*

ularity.

Noting that sales of both
Fund

and

NATIONAL

Dela¬

Delaware Income

INVESTORS

Fund have been
in

recent

October's

particularly good
months, Barringer says

combined

$2,350,000
month in

though

total

represented

history.

the

of

some

the

best

results

are

not

yet

complete, he goes on, has already
eclipsed October by quite a mar¬
gin.
-

A Growth Stock Mutual

Whitehall

70

$

$

will

th

consecutive

§

Fund,

fund

of

Inc.,

the

dividend

..

the

Broad

bal¬
from net investment income

Street

Group of Mutual Funds, declared
a

Fund

.

*

anced

CORPORATION

November,

6 CENTS A. SHARE.-

fourth
a

quarter dividend of 17
share from net investment

income, payable Dec. 24.,Payment
bring the year's total to 47

cents, the

commitments:

will

6,000 shares of Idaho
Power, 8,000
shares
of
James
Talcott

who

mean

income

in

took

from gain

same

an

as

for

1958.

on

increase of 4.5% in
for shareholders
1958

gain realized
.

on

30 CENTS A

investments
SHARE.:

This

1959

the

Year-end distribution from

.

Payable December 24. 1959
Record Date December 4. 19^9

distribution

investments in-addi-

63 Broadwn-,

NewsYork -a. N. Y.

1

,',a

y.

unable to regain any market
pop¬

ware

A

t

Rod P.

Lynch,

Merrill

with

Fenner

^assets

balance

„

TT

ZANESVILLE, Ohio

invested in bonds, preferred
stocks, net cash and receivables,

was

;i(;

Jen. 1 will admit George K. Head*
rick, Jr. to partnership.
1']

to

toom 18,October, 1958, to 21,000 in
October, 1959, an increase of 17%;

000

cents

.dividend, of. 13. convertible
preferred,. 4,300 shares

A

cents from gain realized of
investments also
has been de?

of 30

Ellis &
$15.18, after adjustment for a Simmons,
208
South La
Salle
capital gains distribution of 26
street_ members Gf the New Yojji
cents

Major
changes
in
investments
during the quarter ended Oct. 31

5t4%

from
investments in

to

ago, after adding
back this year's distribution
from
realized gains of 40 cents a share.

new

of

in the market value of the fund's

assets

distribution
on

shares.

re-

investments, the report said.

Fund

gain

a

L.
an-

by new and old
as well as the rise

shareholders,

reports that at
the close of the Oct. 31
fiscal year
net

net

Robert

investment

money

.

Colonial

included these

«

CITY

T.

shares

stock of General Public
Service or,
at the election of the

$10.30,

o

498,570 and $17.74 a'share




from

realized net gain on
investments for the
year, payable

and

Energy Fund reports total assets

Fund

1959,

of

*

a

dividend of 10 cents a
net
investment
in¬

additional

Fund

Cody told stockholders in the
nual
report.
The increase

eliminated

Corp.

with 25
Income froni

$8,493,508 to $13,- Cincinnati Stocks Exchanges,
the fiscal year ended Jan.
1 will vadmit -.William

31, Cairman S. Waldo Cole-

man

Dec. 28.

Service,

1958

additional

„

payable in cash,
distribution of 26 cents a

in

at Nov. 30 of

N A ME

a

share

sale of

from

payable

common stock
oversubscribed and the books
closed after
being placed on the
market through an

the proceeds goes to the
company, which distributes exclu¬
sively the shares of five open-end
investment firms.

write to

and

on

!|t

v

Public

a

for

was

Ask your

or

share
come

Sanders & Co., Inc.

sold

investment dealer for

General
declared

in

future income.

prospectus

share from net profit

securities, both payable

figure
$1.89 a

to

net profit for the fiscal
year ended
Aug. 31 of $404,259, equal to 83
cents a share,
a

and 50 cents

year-earlier

Madison Square
Garden, a

77 cents

a

*

present

share from undistributed

a

ordinary net income

#

a

$11,448,410,

share.

cents

the

realized

to

and consists

The Funds Report

Address.

compared

from

rose

300,770

as

Name.

will

year

CINCINNATI,. Ohio — Benj. il'
Bartlett & Co., 313 Vine Street,

Stock

compared with 18.5%

turn

space

cents,

paid in-1958.

took

private

a

company.

Commonwealth
assets

1924 U11-

charter

its

operate as

something

value

end of

amended

it

Shareholders

market

24

gain

gradually

company

At the

Oct.

a

to

manufacturing and "qr>
by 1923 had liquidated the last of £>©111.

half billion dollars worth
the steels were viewed as

sold

Group of Mutual Funds.

clared for payment Dec. 24.

textiles.

cotton

War

which

Bethlehem.

""JJ

«
This

of

com¬

Motors, General Electric, American Tele¬
phone & Telegraph, Du Pont and of the next four favorites, three
are
oils—Texaco, Socony Mobil and Phillips Petroleum.
And not only is Standard of New
Jersey holding top favor as

investment dealer.

I

J'

producers

of

len decl^hf^-^

National Investors will be
1.2^
higher in 1959 than in 1958, how,
ever, for those- shareholders vrtii

*

1,600-odd investment

panies, trust funds and insurance companies continues to be Standard Oil Co. (New
Jersey), followed by such other bread-and-butter

„

dividend

chare

Manufacturing Co., a perholding company.
In exchange for these assets, totaling
more
than $1.9 million, Fundamental issued 194,232 shares of its
capital stock. From the time of its
incorporation until 1923 Uncasville was engaged in manufacture
sonal

income.

A prospectus on each

quarter
<

t

cents

investment

Yet the most favored stock of the

fourth

A
•

...

ville

sion has been most emphatic

in the matter of oils, aircrafts and

cf

acquired the assets of the Uncas-

airlines.

l

*

bring total dividends for the

Fundamental Investors, Inc. has

withdrew from

fondness for the

a

-

lube.

high-flying glamour stocks—issues such
as Texas
Instruments, Polaroid, General Tire & Rubber (Aerojet),
Radio Corporation of America,
Westinghouse Electric and Phillips'
Lamp Works, even as they were displaying an increasing aversion
toward extending commitments in the
general market. That aver-

shown

distribution

a

•

*■

8,000

.

v

A

share from gain real.'
ized on investments also has
beer!
declared payable Dec. 24.

3,500

-

Natural

Paso

shares.

cents

.

bull—there

the

v

But

ESTABLISHED 3925

-

the
of

25

eliminated

Fund

shares

51/2%

tional

■Puget Sound Power & Light, 1,900
of

of the

talk, frequently backed up with hard
cash, is of the glamour stocks that have yet to double and triple
in price (or so they think).
'

Investors
A mutual fund

talk in investment circles

coming rotation
of market leadership. As far as the general public is
concerned, it
is scarcely a murmur.. The people who latched onto the space age
and electronics issues—the glamour stocks—and rode them up
have

Incorporated

of December—the'month

days

has been much

j*

514%

debentures

Colonial

during

vestment Company, Inc.,

;

Transmission

Gas

Thursday, December 10, 1959

convertible preferred and $100,000
of
Olin
Mathieson
convertible

Capital
Securities Co., N. B. C. Building,
is continuing the investment busi¬
ness
of
Andrick-Goodnight In¬
ANTONIO,

.

..

,

Volume

190

Number 5906

.

The Commercial and Financial Chronicle

,

(2425)

the

;

Housing Act which would
So much for the background of
have provided for taxation of in- " this, persistent issue,
on certain future issues oi
~
Sums Up Renewed Attack
local
terest

,

Housing Authority bonds.

ble

The

Underlying Reason foi

nity

Tax Drive?

Continued from page 13
York. The reasoning of these two
judges reflected, their strong and
continued adherence to the doctrine of state immunity, including

accept

!

!
!
}
I

a

^ningi not^t^Tto^such
f°AJ_hlc^

wfyfaS*d^^
Ways
reSorte^Hhe
<-ven reported the

expressly the immunity of municipal "securities.
-They would 10
even have abolished the distincThe
i

position and to give

our

Treasury

bill

n°or.\

legislative fight was relion between
•'governmental" sumed by Secretary of the Treasfunctions and "proprietary" ac- ury Morganthau in 1942, who then
tivities, exempting all activities recommended repeal of the statuwhich a state has embarked upon tory exemption not only as to
in the exercise of its reserved future issues, but even as to out-

government to promote standing issues of municipal
welfare. In discussing bonds. This time the Treasury was

powers of
I /the public

jn

reviewing

argument-, upon which the
Treasury Department and the De-

partment of Justice have been
relying in their efforts to sustain
the constitutionality of a tax upon
State
and
municipal securities.
The majority of the Court take
the position that any tax, even
though non-discriminatory, which
interferes/.with, the

performance

of the States'function of govern-

ment, is barred, by the Constitution.
Even the Treasury Departthat the taxation of

admits

ment

derived

income

from

State

and

municipal bonds would impose a
material burden upon the States
and their agencies."
•

I mieht also note

dicated

before

as

that

I have in-

prlsent

the

5

tor'nevGeneral'o^CaUfornhf

p

in

years''

on

even

emor'

of
or

ernoi

believe

Defense

S tote

was

c/nl

and

Calitornla

that

his

dh
do

T
I

basic

not
not

political

philosophy changed when he berhdf Tucfino n-f
came Chief Justice
of ihrx
the TTnHori
United
States

*

.

Another

which

one

.

of the basic

researched in

we

issues

1938

was

the Treasury s argument that state

Snpp

Wpfnnn/
found fhlt
that

thd
that

We

ance.

a

argu-

executing
be

Host, nail

not

tarfa J^alfo

know

onlv
only

comDose
compose

assets

held

counts,

that

in.

b(
oi

personal trust

all

amounted

2.8%

of

of

the

reported

the

ac-

no

more

investments

estates

in

to

of

in

individuals

3.2%

1950,

of

,

those

The average

of
holdings of municipals in the
estates of millionaires has only
amounted

to

about

10%

of

their

assets.

This has not changed from
the 1930s through the 1950s. And

these

millionaire estates, on
the returns filed in
1955, the latst

same

available,

reflected

ldmgs of 64.8%
in

average^

of their assets

corporate stock.

,

pnetary.

we measured

the

fiscal effects of the proposed tax
we

found that the gain which the
Federal Government might make
was

exactly offset by the loss to
by state and local
government.
The
real
change,
therefore,' would not reflect any
fiscal advantage to American govbe

suffered

ernment

as

a

whole

but

rather

a

shift of powers and functions from

local

government

to

the

central

government.

These
of

the

and

of

of the

highlights
argument which

persuaded toe United State, Senate

in

finally

1940,
came

when
the matter
to a floor vote, to




self-

will

is without

not
pro-

intent of

Congress.-'

*

-

"'(3) Legislation has been intro-

,

But both the Tax Court

advocates

of

an

omnipotent

cen-

The

inclusion

of

a

subiect

of

l/cal

fl-

am

con-

fident also that the members of
the Committee, who are practical
men
and who understand the
workings of our democracy, will
feel that u is altogether proper
for the Governors and Mayors to
try "1° impress the Committee,"
by exposing once again the hokum
and bunkum of this chestnut and
*ts disastrous consequences to the
states, and the cities. The Mayor

New

"impressed"

York

the

Committee along these ,lines 20
years afeo. I quote him again:
"Now, gentlemen, this proposition is not new. It has been kicking around Congress for the past

20 years. Fifteen years ago today.
Feb. 7, (1924) it was up in the
House of Representatives and we
voted on it on Feb. 8. At that time

the House

privileged to count

was

among its numbers the following

gentlemen who are now in the
Senate: Senators Barkley, Byrnes,
Connally,

Hayden,

Hill

Ala-

of

bama, Thomas of Oklahoma,
Tydings, and every one of them
voted against it. That is why they
are hi the Senate today, I guess."
,

Finds Mui»c»Pals Are Taxed
The second

area of renewed at-

tacks on municipal bonds by the

J

"and Ho JPJLggtS sMe

^°n" Afnl "U H44.,

Supreme

*

the

down

government's

reauest

?ora\evfew
of thllcircuit "cSs
^5_?j.r_e
w v>linr ^ircuu moults
Decision~
uecision.
^

r'"

Despite their defeats before the
Ways and Means Committee and

fhe

on

and

muni-

floor of the Senate in 1940

and

1942

the

Supreme Court the Treasury

and their defeats before

returned
totthe attack in 1951. In
that

the Treasury attempted

year

stitut1nal

power to control state and municipal

nnt

financing,

thP

to

fn

nnwov

dlstrov
d9str°y>

to

i

and

whether

tsv i5

f",

or

nmimr

is vervnostovolvthe

" is very

positively the

(2) Without independent control of its own financing, no goveminent, Federal, state
can continue
as
a
free

dependent state.

It was m the spnit of this poll-

a

.

.

importance or mis leai

When

the bill

extremely

intricate

and complex language to deterwhether it resneoted

the full

mine wnetner it respected tne full

quences to the states and dties"
the
Furthermore, the
the staff
staff nf
of the

^
exemption which the Constitution requires for municipal bond

Committee,

interest, whether received by life
insurance companies or anyone

who

organized

invited
ts»

Ind
the

aidhearing

not

They
the

tical philosophy that Senator

as

1959

lssue and to minimize its conse-

™

local,
and in-.

or

.

..

this rell

imnortance of

Furthermore.

T

power tQ control;
P°wer
tq control^

Act of

1a"cu"atedToUldenf|raterthl° con! to"aLlyzeltl

even the statutory exemp- cipal bonds, it has inevitably the

Court of the Umtcd States turned

+

n

only
in

an

the

"tax

ex-

individual

.

.

.

_

...

,

else.

We finally came to realize
the House bill as originally
written did not respect the full

renilfetoa/vrcannluv S

have

specifically

?egfimonyPa1d
views

and

G0vernors

our

excluded

htar taStFto wKcK

refused to

opinions
Mavors

of

our

other

and

tion entitles municipal securities,
simple

Two

tests

the

brought

matterToml

wUh thfi problems of
„

and

state

]ocal financlng and who

.

best

are

;

ill

to us. Ftost we
covered that under the House
bill the tax liability of a life in'■;«

*.

•++

The: notion that^ toe severe gn
' ?In the
?re|sm>(s
'J;eom"
Vos
''ou °f the ®^v.1
Senate
Treasits protection in
the will of a

effort

ury

nf

a

a

the

exemption
single sponsor,

we

of

denied

were

the

beating them

the Senate

as

satisfaction

floor of

the

on

had in 1940 and

we

1942.
in

1Q54

rather

mftvpd

;n

tainpd

an

auicklv

hnard

that

Cnrnmittee

bpnd5!

Sial

revenue

on

and

the

an

the

had

munion

in_

Almost

bonds.

immediately this action
tested

before

Lad'hnd

„

fhp interest

r7

ob-

arid

announcement

f

f

nnnnnents

our

Waan^"j!
npno^ifv tn hP
Jfov* onri Mpans

was

pro-

Committee

by high
state and municipal officials from
^

an

balance

^

^

^

^

^

the

country and within
couple of weeks the Committee
over

between

the

and the nation outside

the field

to

have.

extraordinary

franklt

to

nro-

0f Mavors

senate

°

;

and

l^oid

"a

remfnded

comment

the

Cmnmitt^

commmee duck m

This is a most deceptive proposilion, and one which the uninitiated and inexperienced legislator might readily fall for. I had
the benefit of a term as a city
official in-between my first service in Congress and the time this
came up, and had it not been for
that experience, I can readily see

assumed

They are relegated to a

Fortunately, for the record at

in the functions

which

McGee,

invited to present his

methods views ft these so-called hearings
must f° that the municipal market at
iney musi least if not the sovereign states
Pay the Federal Government for and their cities, will have one

With regard

housing bonds.
industrial

Committee

bonds,

revenue

adopted

a

the

substitute

they

exercise

wbich

the

under which

powers

be

allowed

business

familiar and
in a plant
such bonds would not
a

to

tenant
take

deduction

the

for the

normal
rental

paid to his municipal landlord,

This latter bill failed to pass the
Senate.
the House
defeated, by a vote of 199
to 70, a proposed amendment to
Antoonly last May

again

thev

and

privilege

th

th

by

u

knew

Wer

that

bill

to

the

ii
municipa

attempt

limit

*

bonds to partial exemption would
precipitate

new

a

Constitutiona

test case in which the Constitutional basis of state immunity
would be attacked and that ir
the process and in the years durjng which the case was before th'
Courts, the whole municipal bone'
market will be upset and disorganized.
.

gtate

the

and

municipal

this

serious

attention

of

offidal,
tc

prospect

the

Senate

Fi-

exercising

the

Constitution,

voice—and

a

very

able

one—to

challenge the chosen spokesmen
who wUl be repeating the argu-

?u
V^ ments which the theoreticians and
here, they are dispos- centralists have been warming
their natural resources, over for the past 20 years.

perform

the scope of

^

they issue securities

At any rate, we are apparently

other acts within

faced with the prospect of still

any

their police

3 326 U.S. at 594,595

ny
'

of

the

tax state and municipai bondunearned

teregt

b

insurancf

life

companies but merely reduced the
mogt important

by

h

j.be

b^j

•

\

tional.4 The
five

deduction allowec
gupreme Cour

rpbe

already held that such treat
t

u

of

dodgec

Act, sticking to the sophistry fha
the House bill did not on its fac

as

or tomorrow
or

Thev

of sovereignty guaranteed

whether,
ing

of

was

the

emnlov

wmcn tney employ,

with which many are
financed by

com-

merelv

v^fdfn^
yielding '^muu/clna1
yielding municipa.

servile status. They become
mare sei^vilc status, iney oecome ber a]a(j former President of the =.
Treasury representatives
subject to interference and con- Municipal Forum, Mr. Cushman behind the complexities

its recommendation

to

tax

the

inrrem?ed

more

trol both

tax

We

the House
^^

brought
.

bill

life insurance
be

bl LiSncr flnm

Mavor

of

hcW

announced that it had withdrawn

to attempt to

House
a

would

Governors

which hovvl might have been deceived

independence

they have always been

this

La Guarding

eign to tax another is an innovation s0 startling as to require
explicit authority if it is to be
allowed. If the power of the Federal Government to tax the States
is conceded, the reserved power of
the States guaranteed by the
Tenth Amendment does not give

the

nanv

of

? I fcl ta

States

.

them

under the
liability of

obiect

?o higher
g?™®e°\s^the Commit! bond^ g

of legislative controversy.
".
The power of one sover.

F'rlv

a

the

dties of the United states from
these hearings, asserting that the

°^®cl
p|rade

an
amend- transient majority of Congress is
striking foreign to and a negation of our
failed to find a constitutional system. * * * The
so that that year Constitution was designed to keep

obtain

to

ment to the Revenue Act

he

are some

type

mhA

not

Treasury regulations which respect and carry out the language

of state and

portunity to our Governors and
Mayors—even what the Committee's representative has described
as a "parade of Governors and

S'H the ,^ircuit, Court q£ Appeals tral government with a political _ch
such'ove'rwhelminc
overwhelming lHiuSrconpolitical con- Treasury arises "out
out of
of the"
the Life
.1^°.: Ph,'losophy of our own. It is this: sequence as the .power of the Fed™ ] Insurance Comoanv
Income Tax
® J*®™
T-H

^

Finally, when

is

.

reported in 1954 and 2.7% of those
reported in 1955.

that

called this ''deceptive proposal"
they will, as they have always
done in the past, "give every op-

mendation.

contrasted with holdings therein of 60%
in common
stocks and that state and municithan

Company

1()tr()

Act

therefore

and

effective

considera¬

the
tbe

to

as

pal bonds

of

interest

tracted litigation unless it is followed
bv
the
'promulgation of

munHinHl the 25 members of that Committee

15%
15
,o

about
about

Act

formal

tion of what Fiorello La Guardia

We

siihiect

taxation at nroerpssive rates

bond

insurance

Xax

toward

moves

Means Committee, at the conclu- leal philosophy that - Justices Qf the w
an(J Means Commit. though the interest is supposeci
S10n °^-^'h^ch we were given rea- Douglas and Black said in their tee has been brutally frank about to be "wholly tax exempt."
01?
1VG
?+v> na^
"tIS ilfSn
cmfprpifrn the exclusion °f the states and Secondly, we ascertained that

nm

the

Life

Income

H?en wa? the real10t?ec'

...

for

municipal

of

the

exception in the

„

most

implement

to

fbe specific statutory excention in

^IhrTleasnlToumfTZ/fol ^ °?ain the repeal o[toe'section Borah said at that time "I do not
tte
dMhutZ r ifnah of Oie Revenue Act that. by way thmk that Congress would have
S distubution fig- ?f
implementing the constitutional the power to tax these secuiities
And S recent
immunity of municipals, exoresslv
and
matter of policy
And

reluctant

municipal officials from the present hearings, I am confident that
if the Ways and Means Committee

Mayors"—to be heard,' I
Deoartment

•

.

afle^h/'becmle Go/ within

California.

been

Treasury

ilv.e of those who pressed these duced again in an attempt to
Dmoated m the Congress, the drives from 1938 to 1951? What whittle down state and local tax
Department of Justice turned to was it that gave these persistent immunity by singling out for
?./ry.in^
break attacks the quality of a warped taxation the interest on industrial
through the constitutional barrier and twisted crusade? I can only development and local housing
hy arguing that although the Port conclude, that we were facing the authority bonds.
Authority was clearly a corporate attacks of centralists—as sharply
with regard to the first item,
a^®,ncJ£ °*
States of New York distinguished from federalists — we had been hopeful that the
an(J New Jer®ay> it was not a who believed that the states had members of the Ways and Means
jf. *?£ political subdivision
outlived their usefulness and that Committee would have been pery^hhin the language of the statu- we should be governed by the de- suaded that a fundamental constitory exemption. That many of its partments of an omnipotent cen- tutional issue of such magnitude
n
<?ns.' /j110!1. a,s
rental of tral government. This, I believe, and consequence as the immunity
space to industrial corporations in was the political philosophy that Qf state and municipal securities
Fort Authority Building and was storming the gates of Con- should not be lumped into agenda
H*e °Perahon, in which we were gress in those attempts to gain expressly put together to consider
^en^engaged, of a bus line over Federal control of local financing. such tax "loopholes" as excessive
th? Goethalsf Fndge, were proThe states and cities met these expense accounts and the like.

toe of toe orgardzers of the Conference

has

theory of tax
evasion not supported by the facts
and that it directly threatens the
borrowing power of local government. It has been demonstrated
time and again that any financial
gain which the Treasury might
make would be more than offset

1-

Authority's Exemption

t

b

The

that it is based

the Ways and Means Committee by the financial losses
refused to report the bill. ;
local government.

"... the Court has demolished

(2\

fav0r

on

the whole question of

open up

again that
the proposal is economically unsound, that it is unconstitutional,

PV

the

Xhe Wavs and Means Com-

for this fall

and

even more resoundingly

,

to

for this drive to undermine
time

on the immulocal bojads is

and

municipal bond tax exemption
once again at hearings scheduled

state and local government. It has
shown

state

mittee of the House has decided

destroy the immunity of state and

[ the significance of the Saratoga
I Springs decision before this
I Forum in 1946 Dave Wood said:

defeated
on the floor of the Senate by a
vote of 52 to 34 and once again

n \

municipal bonds1 one cannot but
wonder about the underlying
been

of

•

renewed in three areas:

of

this 'history

Persistent and recurrent efforts to

reaSon

.Today the attack

■

the

29

th

mimicipa

a°d S

Unconstito

Treasury refcresenta
that the Suprem

reasoned

—__.

afdhearndb^una^fHond
u~ (W '
state ana municipal Donas,° De*ue- uSSls fe
rn-ntiwieA
™

spite the exclusion of state and

c.onrtnuea o

nnnp

p g

a

_

30

The Commercial and Financial Chronicle

(2426)

which

Municipal Bonds' Immunity

ernmental

the

of

—Some Current Problems
Continued

should

Court
test

from

of

"does

adopt

what

"taxes"

tax"

not

state

This

acceptable.

bill

reasoning,

was

enterprise and oper¬
project for profit does not

a

put it in the

how¬

ever,

terprise

government

was
not' openly disclosed,
yet based on it the Treasury
representative repeatedly said and
says today that he is not trying

state

tax

interest
law.
sist

the

on

that

in

"tax

municipal

the

under

We,

and

and

this

as

"taxation"

keep

must

cluding

to accomplish
by frankly in¬
interest in the tax
as

result

same

the

base.
The

Treasury

definition

hew

"tax

representative's
"taxation"

of

exemption"

has

to

and

with

do

theory of "proration." It
is argued that a taxpayer which
has allowable deductions actually
pays them in part from its tax
exempt
not

well

as

receive

its taxable in¬

as

from

the

taxable

that

words,

full

In

portion

a

of

other

the

tax

exempt income should be "added
back" in determining net taxable
income. In the
cial

bank's

the

all

of

case

savings

parallel

that

commer¬

a

department,

argument would be
the -interest paid to

of

depositors should not be deducted
if

the

bank

received

tax

exempt

income.
The .Senate Finance
clear

Was

taxation

that

of

it

Committee

did

state

not

may

been

the

confused

by

of both
arguments
Whether the House

want

problem

all

Finance

Committee

the

amendment

fcabled

to

of

alone

the
of

income

ment

to

as

in

fact

meeting
the

our

Senate

proposed
House

an

Bill,

which

de¬

application
taxable

of

invest¬

results

...

in

the

to the extent necessary to prevent
Such imposition."
This

seemed

answer to

like

a

complete

problem. However,

our

we are
having trouble in getting
the Treasury to promulgate
regu¬

lations
tion.

implementing this

We

concerned

are

excep¬

lest

the

Treasury persists

in claiming that
formula does not "tax"

basic

municipal bond interest.
Housing
lf

and

Many state
in
marginal
enterprises: where
'private capital refuses to venture.
Add

the

to

that
it
proposed
to
Withdraw the exemption of bonds
issued for local housing or indus¬
of

this

purposes.

attack

on

The

local

financing was then, and is again
today,
to
confuse
and
divide.
Housing and industrial develop¬
ment

areas.

bonds
But

in

are

controversial
controversy within a

sovereign state, or even between
the sovereign
states, as to the
social
no

or

fiscal wisdom of

invitation

Government

to

to

the

a

policy

Federal

attempt to step in

and decide for the
states, through
the exercise of the
Federal taxing
power, what is or is not a
wise
social or fiscal course.
As Judges
Douglas and Black wrote in the

Saratoga
**A

tax

case:

is

a

1

powerful,




these

projects

the social

pro¬

may be destroyed before it
be launched. In any case, the

gram

tal

change

States
take

the

on

and

of

care

fundamen¬

a

credit

their

on

the

siderable.

.

.

to

programs

needy

the

.

the

of

and

build for the future would be

to

power

tax

is the power to tax se¬
verely. The power to tax is indeed
of

one

of

the

most

regul atio

effective

And

n.

forms

no

more

powerful instrument for centrali¬
zation

of

government

could

be

devised."5
In

evaluating the

to

power

tax

Morganthau

the
be

immunity
ended

proposed

of

for

local

all

housing bonds; I

by an industrial tenant to
municipal landlord. This pro¬

its

posal was equally an attempt to
abridge the doctrine of local selfgovernment upon which our basic

immunity
clear

that

except

the basis of whether

a

in

on

their

not

landlords

it

that

solely

of

tenants
or

munici¬

were

their

hearts

housing. Yet in 1954, for
housing,
with

we

were

proposal

a

con¬

to

con¬

regula¬

Mr. Ireland

This

brings me to a fundamen-taLdistinction to be made between
law

and

Company and

bate about industrial development
bonds. While I must defend to the
of

the

constitutional

state

and

Federal

local

from

believe

it

,

many people
conclusion, that just

jump to

the

because we
public landlord and a pri¬

tenant

in

particular

a

case,
the public landlord has abused its

privilege

and
of

given

its

tax

the

away

exemption.

Denies "Pass Through" at
Port Authority
I

as

that

But

case.

strongly

in

the

would

proposals

to

York

Newark

I

All

of

case

what

I

have

considered

strongest constitutional

reason

to

power

as

for

public service performed
airport itself.' >

and

not

The

a

Port

an

only incidental
part of the prime

to

Authority

the

by

the

within

tax,

Government

would

classify the

some

Fed¬

had

the

to tax municipal bonds, it
obviously have the power

power

such

If the

ever

bonds
as

a

purposes for which
are

p e n

issued,
ally

taxing

for

going
policy of
the moment and
exempting others
as
a
reward for compliance with
Federal policy. I can
imagine no
counter

to

the

Federal

greater blow to local self-govern¬
in this
country. A political

thorized

to

providing
with

to

sary

a

the

diversity of opin¬

ions.

revenues

the

of

brings

me

to the question

industrial

development
fi¬
From the standpoint of
fiscal wisdom I do not
agree with
the policy of some states of
giving
nancing.

away

vate

their tax exemption to pri¬
industry for industrial de¬

velopments. But I believe in local
self-government just as I believe
in

freedom

time

and

prove my
or

of

the

speech.

pldce

belief is when

another

is

And

for

proposing

the

me

one

to

state

airport

or

purpose

of

public

a

de¬

the

facility

revenues

operation

as

neces¬

self-

a

from the air
rights over
Railroad
Terminal

fhland

(known

the

as

Port

was

court

Authority

upheld

of

New

by

the

York

and

our

practice in that
respect was
reviewed by the courts
when the
exemption of the interest on our
bonds from
was

Federal income taxes

upheld

in

1943

and

1944.

Similarly, in the development
the

Which

the

a

to

supporting public enterprise. Our
power to develop such
incidental

highest

requires

for

such

its

incident

public

a

incidental

system of severeign states within
a
Federal
Government involves

speech

an

terminal' and

Building)

of

as

financing of

ment

constitutional right to have a
of local policy just as

undertake such

velopment

airports
large
airport boundaries

within

must

the

of

metropolitan

areas

be

held

and

controlled

airport operator.

used

which

basic

for
do

They

industrial
not

airport

conflict

use

and

can

by
be

tenancies
with

the

their

operations.

legislation

Authority

authorizing the
to

finance

air

policy* terminals in the Port District
was
legal in that state and
clearly preceded
by
comprehensive
within its reserved
powers, which studies of airport
I
financing. These
would, nevertheless, have op¬ studies
indicated that the
airports
posed if I were a citizen
a

of

state.

Being

cast

in

the

that

role

of

defender of the
immunity of mu¬
nicipal bonds 1 simply
cannot, in
good conscience, defend
immunity
only for bonds issued for
purposes

could

development, the Port Authority,
has

adopted several basic ground
rules.
And I may say that these

U, S.

at

593

rules

be

financed

supporting basis
enues

on

a

self-

aviation

rev¬

on

alone.

Among other rev¬
sources, they recommended
the industrial
development of the

peripheral
and

airport

areas

which

controlled

must

within

boundaries, but

be
the

which

standards

or

for

of

estate

associations

First,

ad¬

industrial

our

development at the airports
formally submitted to the
in

were

real

New

York

Jersey.
such

industrial

project

cannot

in any
way interfere with
the basic purpose of the
airport or
its future
development for such

This standard alone dic¬

purpose.

tates

stringent

and

area

height

limitations and the retention of an
absolute right in the Port
Author¬
ity to repossess the

property,

short

notice,

for

aviation

on

pur¬

poses.

merger,

the

its tax

the

exemption to
of

case

tenant.

a

In

such proposed
tenancy an increment is included
in the rental which
represents a
tax
equivalent that
the
tenant
would bear if renting from a
pri¬
vate landlord.
This is not
only
dictated by the basic
every

policy
against passing on our tax
exemp¬
tion, but by simple economics as
well.

You

airports

will

we

recall
not

are

that

only

in

our

land¬

a

lord but also furnish
many of the
services normally furnished

by

municipality, i.
service,

police and

e.,

road

construction

maintenance, the installation
maintenance of utility
Third,

in

any

a

fire
and

and

lines.
the

case,

reasonably equivalent to
the "going" rents in the
area for

similar facilities.
This
last
is
which

our

imposed
with

and
iron

an

tenancy will
it

can

cardinal

a

Commissioners
which

I

hand.

No

pass

my

rule

have

administer
proposed
desk unless

be

rental value which
able

full

fair

can

discipline

ourselves

words,

real estate tax

there is
tax

no

passing

exemption.

In

this

in

and follow such an adminis¬
trative policy, but I must empha¬
size once again that no one who
understands the political philoso¬
way

phy of reciprocal immunity from
taxation

in

Federal

our

system

can

logically support the use of
the Federal taxing
power to break
up.
the
industrial
development
projects of a sovereign state, no
matter how much one may
(dis¬
agree with that policy or with its
administration.

-

I know that industrial develop¬
ment

for

bonds

the

This

are

tempting target

a

opponents of immunity.
know was the reasoning

I

back

,of

the

cautioning

its

resolution

IB A

against

members

underwriting of industrial de¬

velopment

bonds

commendable

ipal

the

purpose

the

and

restraint

underwriters

with

in

of

very

munic¬

cooperating
resolu¬

this

of

tion. It is natural to wish that we,
who must defend the immunity,
did

not

have

the

of de¬

burden

fending bonds issued

for

un¬

an

popular purpose. Over the past 20
years • the
Conference
on
State
Defense

has

effectively
coor¬
opposition of state
municipal officers and of

dinated
and

state
in

the

and

municipal associations
to
persistent and
campaigns to undermine
destroy the whole doctrine of

'

opposition

zealous
and

state

i

m

munity from

taxation.
still

a

Federal
we

can

stone wall defense.

But

Believe

I

man

cannot do

so

that

the

if we Tall into

trap of dividing and embittering
forces by joining those M'tio
would try to enforce Federal tax
sanctions on the exercise of their
our

sovereign

by the

powers

States;01.

Tennessee, of Alabama, of Missis¬
sippi, Rhode Island, or of .any
other state in the union.
'An

address

by

Mr.

Tobin

tb-

before

New York. New

t®

'

Timpson

would

comparable
our

Au¬

a

wholly tax¬
charge for a
building.
I11
other
there is no passing on. of

landlord

Port

with the properties of tax
exemp¬
tion.r. At the Port Authority we

City.

the

benefit of

the

believe, is the proper
adjust the requirements of

Municipal Forum of

least

value
would

the public in this field with soiind
financial policy and, if won will,

rental

at

the

for

demonstrated by our line
department
that
the
proposed
is

rental

landlord

obtain

we

exemption

must

'; This,. we

we

rental

be

must

fair

private

a

and

Authority's
By charging the

of

measure

for

Port

thority alone.-

the

Second, the Port Authority will
not, in computing rentals
applic¬
able to industrial
projects, pass on

enue

held
5 326

not

Dis¬

.

rev¬

help to make these facilities
self-supporting, despite the fact
that airports
generally are deficit

Port

Port

In
administering this revenue
development
program,
particu¬
larly as it applies to industrial

enues

The

the

the

public purposes.
which

way to

not

the

to control.

power

eral

to

in

only

terminals

and New

does

as
was
em¬
purchase property for, not does it
foregoing quota¬ finance an industrial
development,
tion
of
Justices
Douglas
and simply for the purpose and
objec¬
Black, unquestionably — I might tive
of
industrial
development
even
itself.
say magnetically — involves
It is,
however, fully au¬

phasized

before

was

created

are

serve

charge,

Port

on

they

full

trict.

is

the

retaining the immunity of local
financing from Federal taxation.
The

business,

a

New

these

this material

ground

on

airport, which

Our

of

included

legislatures of
both
states
when, in 1947, they adopted the
legislation enabling the Port Au¬
thority to acquire and operate air

want

the

of

ministration

of

fallow.

cities

the

I possibly

as

and

exemptions to any private tenant

force

lie

the

recommendations.

know, of course, that that is

frequently the

otherwise

.

But

benefits

until its

the

Vice-President of the Chemical Bank
New-

.

I

contrary to sound
public policy to pass on municipal
bond tax exemption to
private in¬
dustry.

a

a

1952

Exchange Bank. Since

is

carrying

the

Newquist

Company.
Mr. Newquist joined Brown Brothers &
Co. in 1936.
He has
been in charge of the Investment
Research Department since 1911
and a Manager of the firm since 1953.

immunity

activities

taxation, nevertheless,

been

York Trust

pal bonds except housing bonds.
illustrates

L. J.

Vice-President of that bank from

a

Mr. Ireland has

tinue the exemption of all munici¬

This

R.L. Ireland III

formerly associated with The New York
Trust

was

merger with the Chemical Corn

public policy in this de¬

to assert

con¬

Frank W. Hoch

palities.

public

because he and his associates

spot

becomes

consider

you

classification

that this

assume

had

warm

This

rests.

when

proposed

securities

was

for

paid

vate

power
to control, let us
remember that in the 1930s Secre-

tray

cat in another way by disallowing
a business deduction the rental

have

the

as

had

r

as

end

to

con¬

lightly

right to have

announced

tactics

of

and

repercussions of such

freedom

when, as I have noted
the Ways and Means Committee

development

cost

Federal tax

a

1954,

trial

without
activities are

limits.

the

recalls the crisis

area

taxa¬

practically

diversity

Industrial

Development Bonds
The third

excise

Federal

is

pur¬

Jan

W,

the attempt to skin the

oppose

fronted

imposition of tax on any interest
Which under §103 is excluded from
tax income [i. e. municipal bond
interest] adjustment shall be made

is

field

citizens

curtailed.

or

■

even

well have

Bill

way,

the

their

of

hampered

We

can

conflicting

"exception"

an

any case that
the definition

Of

needs

once

bonds

development

otherwise.

or

1954

of

Authority there is absolutely no
"pass through" of any of our tax

clared that "If it is established in

^

at

its

list, the capacity to

municipal

Frank

Hoch, R. L. Ireland, III'.".and Lester J.
Newqum
Mr. Hoch has been associated with Brown
Brothers Harrimii
& Co. since 1947 -and has been a Manager of
the firm
since 195?
His principal activities have been in connection
with the fin?
foreign investment business.

all
either

exemption

industrial

poses
to

the

and

public

sides

that they were

stockholders.

retain

trary reasons of unenthusiasm for

encompassed such taxation. In the

belief

people, not for
of

to

fought in

we

Partners

Brothers

on

1960:

,

why

municipal

and

bond interest, but

the

the

serve

is

That is

Browh

of

.Exehan?

can

by

exist at all.

banking firm

Harriman & Co.
nis an¬
nounced
the filing-of
applications with the New
York Stat
Banking Department and with the. New York Stock
for approval of the admission of three new
partners

piece as it
may approve or disapprove state
policy, then the doctrine doesn't

for

provide for

on

tax collector's

deduction

income.

its

group

new

terest and that therefore it should

of

to

place the local government

can

>

tax

exists

would

tion

life insur¬

private en¬
purposes.
Local

If the Federal Government

The

formula

tax

limited

a

meaning. And it
a

it apart piece

The

of them.

none

Government

Federal

Thursday, December
JO, 1939

.

Brown Bros. Harriman

protects all
powers
of the

immunity

it protects

or

state

class of

for

welfare

the

much "taxation" to in¬

compahy

and

the

in¬

by juggling state
municipal bond interest in

ance

the

tax

the tax bill Of

crease

the

insurance

field

their established
is just

bond

other hand,

exemption"

not

does

approval. The
principle of gov¬

my

reserved

the

private

and

to

land

free

exist for itself. The fact that local

ate

House

govern¬

government may enter the domain

his

the

this

Local

what

pal bond interest and that under
test

If

munici¬

and

and

in

ment

new

of

new

instrument.

tory

brand

a

states

take

29

page

meet

constitutional

.

.

exemption and
on
our

of

our

bond

philosophy,

Robert

to

Timpson

&

Admit
Co..

on

Jan.

Browne

1
to

63

Wa

City, members
Exchange
will admit Luis F.

Street, New York

of the New York Stock

partnership.

190

Volume

Number

5906

AS WE SEE IT

.

,

The Commercial and Financial Chronicle

.

(Continued from

page

1)

he can to keep the parties negotiating on
around-the-clock basis."

an

President

The

-

was

no

off

sooner

the

air

than

Mr.

posal to make to the President:
union.

Mr: President, that you
direct the Board of Inquiry headed by Dr. Taylor to
reconvene immediately. The union is willing to agree that
...

.

proposes,

this board should make

a

dispute. The
union agrees and pledges that it will negotiate a settle-V
ment
within"! the framework of the; board's recom¬

:
;

mendations."

\t; V. ■'.

'•

,

Obviously, this tactic on the part of ; the lqbor leader
is not altogether free of guile. It would shift to government4the responsibility for determining what is a fair and
reasonable settlement of the dispute—fair to employers,
fair

tc^^e^^yorkers-' •.aild:;Jair tfethe public. The record

shows, of course, that government

deal

gently with labor, and

Government formulated

a

rarely if ever fails to
of the Federal

once any organ

"fair"

settlement it would

be

difficult for the steel industry to

refuse to agree to it. As
a move in
a sort) of chess game, the proposal of Mr. Mc¬
Donald may well be regarded as clever. Whether any¬
thing more can be said in its favor is open to question.
"

.

The fact

Weakness Exposed

is,

though, that the labor leader has in a
very real sense exposed the basic weakness of the President's position. A lamentable weakness it unquestionably
has no matter how much all of us may agree with him
that it is time—long past time, really—that this contro¬
versy had been settled. That weakness is precisely that it
appears to
assume
that a settlement of the sort he
describes could easily be formulated by any intelligent
man or
group of men of good will. The fact, of course,
is quite to the contrary.

•

,

It

is obvious, of course,

that labor monopoly in this
country has made excessive and harmful use of its power
for a good many years. There is no difficulty in reaching
the conclusion that what has taken place is not in the
interest

of

the

Continued from

pattern that has been set of

4

page

with

2.5 points
previous week. Output

from

up

2,619,000

ingot

industry
signed by Christmas.

should be

Industrial

building will bounce

25% in 1960 and be the No. 1 ele¬
ment

of

strength in

construction

"Steel"

the

activity

nation's

next

reported.

billion

1959's $54

and

$56

billion volume.

tural steel

in

Struc¬

1960

public

and

ities to order 45%
steel

than

they

did

Housing is the major weak spot
in

the

construction

outlook

not

year.
Tight money in the
mortgage market is Being blamed

for

the

anticipated cutback from
year's 1.35 million housing

this

starts to 1.2 million in

Steel Output Based on 94.3%
Jan. 1, 1959 Capacity
The

American

Institute

Iron

announced

of

field for. the better part

that matters have come to the present
and until such a market place is restored, we shall

progress as we could and should.

It is the failure of

understanding of this essential
fact, either in his latest statement or in any of the others,
that constitutes the basic weakness of his position.
This weakness is, of course, not

confined to the Presi¬

dent and his immediate advisers, but is all but

universal

the

that

op¬

the week beginning
equivalent to 2,671,000
ingot and steel castings

of

(based

pro¬

compared

actual rate of *165.0%

an

of

a week
TED. NOTE: The strike in the
steel industry which began July
15 was ended via a court injunc¬
tion on Nov. 7.]

Actual

gininng

output for the week beNov.

30

equal

was

to

93.6% of the utilization of the Jan.

the wage earner must be given
of all there is no evidence today

special status. And worst
despite all the difficulties
we have been
having and are now having that the poli¬
ticians
and we must suppose the voters — have even
begun to awaken to the true inwardness of this situation.
The rather long series of statutes and court rulings which
assure wage earners a position of monopoly are all but
sacrosanct in the minds of all too many of us.

94.3%.

the operating rate

(based on 1947-49 weekly produc¬
tion) was *80.4% and production

1,291,000 tons. A year ago the ac¬
production was placed
1,985,000 tons, or *123.6%,

muddle through this steel situa¬
tion, and sooner or later reach some sort of arrangement
which will enable the steel mills to function continuously
shall, of

course,




re¬

Business

Failures

for

3

Commercial and industrial fail¬

dipped

ures

to

ended-Dee.

in

261
from

3

the

268

week

in-the

production is based

on

aver¬

weekly production for 1947-49.

inventories

parts

next

when

week

General Motors

back into action after

get

steel-shortage

a

than

six

layoff

of

more

"Ward's

Automotive

Chevrolet plants at Willow Run,

Mich., Janesville, Wis., Norwood,
O., and Flint, Mich., began assem¬
bling cars on Monday, Dec. 7, as

said that auto output has
the

bottom

of

strike decline

its

and

reached

severe

has

slow return to volume levels.
The statistical service described
U.

S.

Dec.

production in week
5

of 53,915

ended

cars—15% above

previous week—as the first in a
of weekly increases which
will see the industry boast its De¬

series

assemblies

75%

above

November.

Scheduled

for

this

month

are

447,300 car completions compared

failing

in

excess

from 29 of

preceding week.
casualties, down to
31 from 55, and wholesaling, off
to 30 from 35, accounted for the
downturn

week.

In

in

the

post-holiday

contrast, the toll among

manufactures climbed to 67 from

the

ceeded their year-ago levels in all
lines except retailing
and con¬

struction. " The

Cadillac

Plant at Detroit.

manufacturing.
regions reported declines
during the week. Middle Atlantic
failures

fell

States,

production

on

Chrysler
sion

and

plant

also

to work

Corp's

the

Imperial divi¬

Hamtramck

Valiant

planned to return

are

1958
The

amount

electric

107

in

and

19 from

marked

the

Pacific

61, in the
West South Central, up to 21 from
10, and in the Mountain, up to 10
from 4. There was no change in
the

East

North

the

toll

Central

States

remained

trends

31.

at

also

were

mixed: five regions suffered fewer

6.8% Above

Week

of

from

to 74 from

Year-to-year
Electric Output

86

occurred

up

where

Dec. 9.

on

to

South Atlantic dipped to
22.
On the other hand,
increases

resumed

sharpest rise from

appeared in

Five

visions

energy

casualties, three had heavier tolls,
and one equalled its 1958 level.

distributed

by the electric light
Intercity Truck Tonnage 2.8 %
industry for the week
Above 1958 Week
ended Saturday, Dec. 5, was esti¬
Intercity truck tonnage in the
mated at 13,907,000,000 kwh., ac¬
week ended Nov. 28, was 2.8%
cording to the Edison Electric In¬
ahead of that of the corresponding
stitute.
Output was 734,000,000

and

power

kwh.

above

that

of the previous
13,173,000,000 kwh.
gain of 890,000,000

week's total of

showed

and

kwh.,

or

a

6.8%

above that

of

the

Car Loadings 6.4% Above
1958 Week
revenue

freight for

the week ended Nov.

28, 1959, to¬
taled 574,126 cars, the Association
of American Railroads announced.
This

was an

6.4%

increase of 34,637 cars

the corresponding
1958, and an increase of
20,404 cars or 3.7% above the cor¬
responding week in 1957.
above

in

included

the

were

Thanksgiving
55,236 cars or

8.8% below the preceding week.
Lumber

Shipments
1958

of

week

Trucking

1958, the

14.9%

American

Associations,

nounced.

Truck

below

the

Inc.,
tonnage

previous

an¬
was

week

of this year; the tonnage decrease
reflects the effect of the Thanks¬

comparable 1958 week.

steel-

begun the

up

this size in the

Buick, Oldsmobile and Pontiac di¬

Day Holiday

Reports"

$100,000, edging

1958

weeks.

Loading in the week of Nov. 28
Volume Levels

the

of

had liabilities

concerns

of

week earlier and 40

a

Thirty

year.

49, among commercial service en¬
terprises to 23 from 19, while the
"Ward's"
said
the
production toll among retailers held steady
picture would brighten somewhat at 110. Casualties equalled or ex¬

which

Auto Output Climbing To

32

last

other Chrysler assembly sites have
been closed by steel shortages.

week

age

a

three-day scheduling at
the Detroit Plymouth and Jeffer¬
son
plants and at St. Louis; all

or

of

worked

and

at

cember

We

of

Construction

Depleted
two-

tual weekly

""Index

facilities.

Packard

-

Loading of

A month ago

—

•

in

Lincoln-Thun-

Falcon

assembly.

1, 1959 annual capacity of 147,633,670 net tons. ' Estimated per¬
centage for this week's forecast
is

its

schedule, and American
Motors returned to Saturday car

for

Washington, and for that matter in the various state

capitals and other places where politicians foregather. The
situation has its roots in a long period of our history—when so-called liberals evolved the notion that somehow

production
-was

were

auto

Wednesday, Dec. 9.

Steel

and

erating rate of the steel companies
will
average
*166.3%
of
steel

tons

at

and

Studebaker

did

1960.

ago.

the President to show any

in

for

capacity and 2,650,000 tons

half century

said

five-day

plants

make it the

pass,

this

year.

as

a

util¬

fabricated

more

weekly

to function in the labor relations

vs.

fabircators report they

industry

expect

billion,

average

only all-wise arbiter of such matters as these-—
a
myriad of others constantly up for decision in
the economy—is the market place, and that market place
must be one from which monopoly is wholly absent. It is
precisely because no such market place has been permitted

1958,
mills

4.5%
above;
15.3% below; and
orders were 7.8% below.

Drop

De¬

forced Chrysler Corp. to revert to

Construction over-all is expect¬
ed to chalk up a record—between

$55

derbird

year,

1947-49)

as

in * November.

"Ward's"

operations

all of the contracts in the

on

The

in

-

duction of

One All-Wise Arbiter

254,418

cember of last year netted 593,920.
In recapping the production set¬
back

tons.

with

"right" solution.

the

about

was

sibly of the public in general. That would, however, not

of

week

building preceding week, reported Dun &
reached/ a. model
changeover Bradstreet, Inc.
"Steel's"
At a six-week
price
composite
on
fell
heavy melting steel scrap slipped weekly "low of 18,335 units in low, - casualties
noticeably
the
83 cents a gross ton to $42.67 last early September, posted a peak of from
294
occurring in the
133,420
six
weeks
later, then set¬ similar week of last year? and the
week.
Mill buying activity is still
tled into a six-week and 65% de¬ 287
occurring in 1957. Some 12%
sluggish despite the rapid rise in
cline that ended with 46,740 com- fewer businesses failed
than
in
production. A year ago, the price
prewar 1939 when the
toll was
of heavy melting steel scrap was petions last week.
The statistical agency said Ford 297.
$39.67 a gross ton.
Motor Co., American Motors, and
Liabilities
of $5,000
or
more
Labor peace in the copper in¬
Studebaker
Packard were the were involved in 230 of the week's
dustry, which has been plagued by
only producers to schedule normal casualties as against 236 in the
strikes since mid-August, seems
assembly operations in the recent previous week and 254 a year ago.
close at hand. Kennecott Copper
week.
Ford
operated
all
but Declines,, also
prevailed
among
Corp.'s settlement with its United
three Ford car plants on a five- small
failures, those with liabili¬
Steelworkers
of
America
locals
day basis and maintained six-day ties under $5,000, which dipped to
should set the pace.
Practically
31 from

years,

and which would perhaps meet with the
approval of this or that group of the general public, pos¬

,

below; shipments were 23.0% be¬
low; new orders were 7.9% below.
Compared with the corresponding

Week Ended Dec.

recent

well

requires
doing its

new

capacity
Dec.
7,

as

us

STATE OF TRADE AND INDUSTRY

would

the

ruling

now

shipments

which

into

general philosophy

porting

next

fit

week ended Nov. 21, 1959, produc¬
tion of reporting mills was 16.4%

another—but the unfortunate

things.

public—not even in the interest of the
our estimation. It is, however, one thing
to recognize excess when it is repeatedly seen, and quite
another to say precisely what should have been done and
what should not be done. Equal difficulty is encountered
when the problem arises of gaining acceptance of any
iudgment that might be rendered. The gentlemen who
Mr. McDonald would like to draw up a "fair" agreement
are no more able than the rest of us to do anything of the
kind. It could without doubt formulate an agreement

in

wage earner

,

or

that steps be taken to prevent hard times from
normal work of
readjusting such

capacity,

-

A;

;

time

one

1.4% below production,
with
the
previous

were

Compared

withstand such strains.

mand his fee at

reporting identical mills were
below production; new or¬

0.4%
ders

recommendation to the parties

to the terms of settlement of all issues in

as

of

moving would appear strong enough
Naturally, the fiddler will de¬

fact is that the

equi¬

were

valent to 45 days' production.
For the year-to-date, shipments

For the moment at all events the momentum under
which the economy is
to

31

rate, and gross stocks

use.

McDonald, head of the Steel Workers Union, always ready
to do battle on the forum of popular feeling, had this pro¬

'"The

f

again—and any errors which may be committed will, of
be charged to the general public in the form of
higher prices for many, many of the things we want and
course,

do all that

to

(2427)

15.3%

Below

Week

giving Day Holiday, Nov. 25. ;
These findings are based on the

weekly

survey

of 34 metropolitan

conducted at the

areas

search

Department.

ATA Re¬

The

report

reflects tonnage handled at more
than 400 truck terminals of com¬
mon
carriers of general
freight

throughout the country.
Wholesale

Food

Price

Index

Unchanged in Latest Week
The

dex,

street,
week

stood

7.4%

Wholesale Food

complied

Inc.,
from
at

by Dun

Price

&

In¬

Brad-

was unchanged this
the prior period. It

$5.92

on

Dec.

from the $6.39 of

1,
the

down
cor¬

responding date a year ago.
Up in wholesale price this week
were wheat,
corn, barley, hams.,
Trade Barometer were 14.3% be¬
lard, butter, cheese, sugar, cocoa
low production for the holiday
and eggs. Lower in cost were rye,
week ended Nov. 28, 1959. In the
same
week new orders of these bellies, milk, cottonseed oil, pea¬
nuts, raisins and hogs.
mills were 6.0% below production.
The Index represents the sum
Unfilled orders of reporting mills
total of the price per pound of
amounted to 33% of gross stocks.
31 raw food stuffs and meat in
For reporting softwood mills, un¬
filled orders were equivalent to general use. It is not a cost-ofContinued on page 32
16 days' production at the current
Lumber

shipments of 461 mills
reporting to the National Lumber

32

Continued from page

31

living index. Its chief function is
to show the general trend of food
prices at the wholesale level.
Wholesale Commodity Price Index

Dips Slightly From Prior Week

grains,
sugar, steers, lambs, rubber, and
steel scrap offset slight increases
on
hogs, butter, and flour this
week, holding the general com¬
modity price level slightly below
the prior week. The Daily Whole¬
sale Commodity Price Index, com¬
piled by Dun & Bradstreet, Inc.,
Stood

prices

at

Dec.' 7,

week

(1930-32=100)

compared

earlier

most

on

276.06

and

275.41

on

a

the

ago.

year

a

on

276.77

with

corresponding date

Wheat prices were down ap¬
preciably as trading lagged. Over¬
all export demand fell, despite a
;

sizable

purchase by India. Pakis¬

is expected to be in the mar¬
ket next week. Although offerings
tan

of

light, prices were
moderately as transactions

rye

down

were

fell.
.

There

'

slight decline in
corn prices and trading was dull.
Oats prices remained close to the
was

preceding

a

week and buying

was

unchanged. Although the call for
soybeans expanded somewhat,

prices showed little change.
! Although
flour
trading
was
sluggish throughout most of the
week, prices climbed slightly at
the end of the period. A marked
decline in export interest in flour
.

occurred

the

during

the

settlement of

week.

the dock

INDUSTRY

most

interest

in the

export

South

Central

—2 to

4"2«

mar-^

were

Indonesa, India, Pakis¬
tan, Ceylon, and Peru. Despite this
rise in
demand, rice prices rer
mained unchanged from a week
earlier.

While volume in sugar was sus^
at
a
high
level,
prices

gains occurred in cloth coats,
suits and dresses, and interest in

appreciably. The buying
dipped noticeably, but
steady. There was a

decline in cocoa prices
trading slipped.
Increased buying at the end of
the week helped hog prices move
slightly higher. Trading in steers
lagged
and
prices
were
down

moderate
as
•

ume

in

low

a

year

earlier.

Prices

the New York Cotton

on

Exchange
showed
little
change
during the week. Influenced by
favorable
reports
from
textile
centers, trading moved up some¬
what. United States exports of lint
cotton came to about 73,000 bales
in

the

week

compared
earlier

ended

with

•

last

-Tuesday,
142,000; a week

and

61,000 in* the
parable week a year ago.
,

similar

the

.Christmas

Shopping

There

this
trade

was

in

a

Year

Slightly

post-Thafiksgiving

Christmas

shopping

week,
and
over-all
retail
slightly exceeded that of a

Shoppers were
pri¬
marily interested in men's fur¬
nishings, women's fashion acces¬
sories, juvenile furniture,
toys,
lighting fixtures and liens. Saies
year

of

ago.

new

passenger cars

were

down

again this week and fell below a
ago, clue to limited dealer

year

inventories, according to!scattered
reports.
The total dollar volume of re¬
tail -trade in the week ended
Dec.
2 was

unchanged

than

a

to

4%

higher

year ago,

according to spot
estimates
collected
by "Dun &
Bradstreet,
Inc.
Regional
esti¬
mates varied from the
comparable
1953
levels
by
the

percentages:
+4 to
South

North

4-8;

Mountain 4-3 to 4-7;
Atlantic -fl to
4-5; West
Central

Central 0 to
—1

to

Ea?t

following
North Central

4-3;

and

West

South

4-4; Middle Atlantic
New England, East




28

a

Jan.

1

Nov.

to

28

7% increase.

a

BOSTON,

glassware and gifts

ard,

during the week and the buying'
floor coverings and draperies

ment

was

appreciably. An

up

" over

The

usual postThanksgiving decline occurred in
sales
of
poultry,, "fresli
meat,
canned
gods and baked goods,
over-all
food
volume
remained

the

to

for

Reorders

gifts.

cruisewear

winter

in

volume

high- level

a

was

as

the prior week occurred in purchases
of
women's
spring and

clothing, but volume in
lightweight suits moved up

in

markets

most

both

over

the

The
call for men's furnishings, sports¬
wear, and shoes expanded appre¬
ciably from a week earlier.
prior week

and

a

re¬

ported marked gains this week in
volume in

and bedroom sets; sales of

goods

case

at

were

areas

goods, upholstered

case

in

Southern
levels.

record

the steel

due to

markets
Although

limited

were

in

some

strike, vol¬

,

well

Trading

in cotton print cloths
expanded noticeably this
week,
and
supplies in some markets
in

volume

cotton, gray,, goods.. lagged.
While the buying of carpet wool
moved
up
in Philadelphia, it
lagged in Boston. Over-all trading
woolens

no

change from

Wholesalers
and

showed

worsteds

and

the* prior
industrial

of

man-made

fibers

Eaton

week.
fabrics

reported

week,

juice
slight

stepped
frozen

a

up

this

in

trading

in

canned

goods, sugar, candy, and shelled
nuts, but interest in poultry, fresh
produce, and fresh meat lagged.
Volume in eggs,
was

butter, and cheese

steady.

W.

Quarter Century Club of J. &
Seligman & Co. and Union

Service Corporation admitted two
new

members at the Club's annual

luncheon meeting at the

B.

of

Malick,

Seligman,
and
handles the

Frank
firm's

who

clearing house work.
J. & W.

ized

in

Seligman & Co.,
is

1864,

member

Stock

firms

the

Exchange.

Corporation

is

the

of

one

of

oldest

New

Union

the

organ¬

York

Service

organization

that provides investment research
and administrative services to Tri-

Continental
tion's

Corporation,

largest

the

diversified

na¬

closed -

end

investment company and the
Broad
Street
Group of Mutual
Funds

—

Broad

Street

Investing

Corporation,

National
Investors
Corporation and Whitehall Fund,
Inc.

employees of the two
organizations, 50 are 25-year vet¬
and still

active.

of Broad Street Sales

subsidiary,

a

Employees

Corporation,

also included in

are

membership.

Townsend,

members

of

changes,

Pa.

—

Crouter

the

Exchange and

New

other

announce

DeHaven

&

Bodine,

York

Stock

leading Ex¬

that

Jean

B.

Hecht has become associated with
them

a
registered representa¬
their Jenkintown office in

as

in

Department

store

the
dex

Federal
for

the

increased
riod

last

Reserve
week

3%
year.

on

a

taken from

Board's

ended

above

In

sales

as

the

the

Nov.
like

In¬
28
pe¬

preceding

particularly

avoid.

It

be

can

anything,, else -that might
to be unprofitable in the
It is

truism

a

that when

make

/'switch" you have to

a

Benson-East, 100 York Road.

Dempsey-Tegeler Branch
WESTWOOD, Calif.
Tegeler & Cc
office

—

Dempsey-

has opened

a

branch

at
10l*
Broxton
Avenue
under the management of Peter C.

Olmstead.

regu¬

.

of

Out of

Into

Even

*

Volatility

and

where

maintain

bonds

his

may

be placed

stronger position, it is

a

doubtful

if

very
"switch'" from
a

a

more

volatile

into

that is of sounder quality
slower moving) is patho¬

speculative security

one

(but

logically indicated.
like to be

Here I would

specific. I am not
the investor who is

more

referring to

in highly

heavy

speculative

and who should consider

a

complete revision of his portfolio
in
the
light of his
investment
needs.

Nor

building

I

am

of

discussing
if

reserves

the
study

a

reveals that this would be

a

sound

move.

of about

other

cently
if

is

a

in

case

point.

$1,200. In fairness to the

—he

this

fund
I

If

which

would

I

offered

have

said

to

"yes"

she would have made the"switch"
she

would

have

strengthened her
counts.

likely

very

account

She would

much

very

of

sounder

on

sev¬

have

investment

had

much

a

investment.

In

slower

fact,

moving

considering

her loss, I could not conscientious¬

ly

asked for

did

not

show his

entire tax

After

explaining to him that he

should

check

up
his entire tax
liability for the /year, we made an

estimate

his'

of

situation.

After

deducting his exemptions and his
state
taxes, charities, and some
substantial

(both he

his

and

medical

wife

to

bills

were

over

the

conclusion
that the sale of the bonds and the
we

came

would

hardly justified.

was

have

involved

sale

and

been

in

60

on

$150.

the

bonds

Besides,

since-they

were income bonds and
flat
the
"switch"* would

traded
have

entailed

months

of

the

ment dates

bought

with

those

not

that

we

instance although a sale
it is quite possible

made

have made

this man. is

should

case—the

a

friend. Since

living in the area

now

become

And

the

considering

was

.V

this

was

day;

several

the pay¬

identical

not

was

he

selling.

he

of

since

the bonds he would

on

have

In

loss

income

if

even

a

client some¬

this is not the

goodwill generated and
rendered
over
the

service

One
make

recommend

that

she

reminder—if you do

final

tax

some

Unless

are

be certain

swaps

set

pay

aside for next

clay arrives. Prof¬
taxed in 1960.

1959 are.

you

profits

offset

can

provided
for—you should always set aside
Uncle Sam must also be

considering

funds for taxes when
a

reinvestment.

'.

had

high quality but she would also

have

man

picture tp them for comment.';

I

her.

a

would

position

suggestions and he obtained them

Re¬

of my customers asked

one

mutual

eral

he

long-term tax loss

a

broker

thought she should sell a .that funds
depressed drug stock in order to April when
buy a well managed closed-end its taken in

and

that

longer term is significant.

Here

me

me

from

This
$30,000
railroad

investment

and establish

purchase

account

an

(over the longer term)

ifc

an

bought $30,000 of sira-

grade

The -commission

Stability;

to

showed

speculative

reinvestment
Never Move

spoke

city.

value

65)

degree of

any

I

letter stated that if he sold

cessfully with
larity.
'

the

buy

I. M. Simon Will

Admit W. Schmidt
LOUIS. Mo.—On Jan. 1, I.

ST.

M-

Co., 315 North .Fourth
jus¬ Street, members of the New York
Midwest
Stock
Exchanges,
tified it was into something that and
will admit Wilfred F. Schmidt to
had
a
better
prospect of
closed-end fund and sell the
drug
stock.
If any "switch" was

Simon

&

large

stocks
never

in

the

know

In considering

drug
what

industry
is

has

active

an

Fortunately I did
"switch"

up

a company

research

division.

not recommend

because

two

partnership.

you

coming

tomorrow, especially if

the

DeHaven, Townsend

PHILADELPHIA.,

The

to

of

later the

With
&

salesman

try

price appreciation.

Of the 226

Sales Up 3% for Nov. 28 Week

country-wide basis

certain

day

letter that he had
received
his broker, in another

rather,

Lawyers'

assistant head
of the Purchase and Sales Depart¬

Joseph

However, there
pitfalls that the in¬

intn

swapping is desir¬
going into details'

a

be right twice. Z This
is a most
difficult ooeration to achieve suc¬

Club here. The new members were

tive

Nationwide Department Store

satisfied.

stocks

Quarter Century Club

their

foods

especially vegetables and
concentrates. There was a
rise

invest¬

J. & W. Seligman Co.

The

ac¬

never

vestor at my desk who

ilar

keeping the

hares,

least, try to do
it.)

Without

bonds

in

for

(Or at

other

losses there is not too much

very

the Club

of

as

and Eaton & Howard Stock Fund.

slightly in the latest week.
buyers

clients,

which bear its ppme,
& Howard Balanced Fund

erans

Food

in¬

to individ¬

institutional

slight rise in new orders. Incom¬
ing orders at New England dyeing
and
finishing plants edged up

purchases

provides

funds

Wardv,

in

Howard

the

problem

a

in

to the two mutual

as

ment

ment

in major appliances moved
appreciably during the week,
especially lighting fixtures, lamps,
television sets, and refrigerators
Buyers stepped up their purchases
of floor covering's, draperies, and
towels, and the call for linens re¬
mained at a high level.

contrast

Charles A. Eaton, Jr.

of

&

and

ume

in

s

vestment management

up

low;

d

able.

of

you

Francisco.

San

ual

and

than

account.

ago.

year

furniture wholesalers

Most

n

one

Eaton

and

advice

for

par

than

country's

and

coats

m-

Chicago, Minneapolis, Los Angeles

were

ask

hares

are
doing reasonably well and
profits are substantially greater

other offices located in New York,

decline from

A moderate

dresses.

«

leading investment
management and counsel firms.
Headquarters are in Boston and

women's

resortwear

and

at

be

the

accessories, jew¬

elry, sportswear, and other mer¬
chandise
suitable
as
Christmas

sustained

*

a

and has grown

wholesale buying of

the

in

week

women's fashion

way

mu¬

fu

t

a

categorically that the mis¬
timing, or of judgment,
when moving a customer out of
one security into
another, is very
likely to irritate a client more

invest-

tual

who

should

develop¬
of

a

follow it, whether they are
doing business with a broker or
if
they have an adviser whom
they employ on a free basis, nat¬
urally expect performance. If they

take

was

ment

this

rise

noticeable

happens to be the

prove

in e n

was

Watch Your Tax
Position .£
Some people do not
realize that
their
tax
situation may not
be
such that tax

sell

or

must go out on

you

counsel and in

somewhat higher than a year ago:
There

it is in the

buy

stated

vestment

the

turtles.

to

vestment

organi-

pioneer in

security
limb. This

are

G. Howard.

zation

your

dation

count

F.

John

late

the

tures.

Although

its

J r.,
President, and

lighting fix¬

in lamps and

How¬

Eaton,

ago.
Volume in appliances re¬
mained close to a year ago, despite

gains

&

observes the 35th anni¬

of

Charles

year

a

Suggestions for Handling Stock "Switches"
es

who

founding by

gains were
registered. Increased sales of din¬
ing room sets and upholstered
chairs helped boost total furniture
moderately

DUTTON

Whenever you make a recommen¬

People

Incorporated, Boston invest¬
management
firm,
today

versary

moderate year-to-year

volume

JOHN

investment management and sales
end
of
the
securities
business.

Mass.—Eaton

(Dec. 10)

upsurge

occurred in interest in linens and

were

Ago

Nov.

35th Anniversary :

of

other

Exceeds

upsurge

com¬

ended

For

Eaton & Howard

purchases

week

1958

v

■

shown.

was

weeks

period.

showed

marked gains from

were

of housewares,

supplies

hog prices, lard prices
change from a week

1958

down

Retailers again

ago.

Some

In

year.

5% increase was reported over the

boys' and girls' clothing,

year in
There

rise

no

four

the

reported significant gains over last

moderately. Volume in lambs was
sluggish and prices slipped from
the prior week. Despite the
slight
showed

period last

holding over-all vol¬
men's apparel slightly be¬

chair s4,

in

was

moderately

dipped

were

like

increase

8%

an

men's furnishings, sales

of overcoats and suits were

increase

BY

the

over

gains over last year pre¬

in

vailed

7%

a

the preceding week ended Nov. 21

sportswear remained close to the
similar 1958 week. Although sub¬
stantial

28

According to the Federal Re¬
serve
System
department
store
sales in New York City for the
week ended Nov. 28 increased 4%

modest year-to-

more

ago;

year

registered and for Jan.

was

Nov.

to

noted.

year

men's

coffee

shoppers

week, and volume was well over
a

summer

prices

crease

stepped
up
their buying of gloves, jewelry,
scarfs and other accessories this

tained
of

£MS

Coast

Pacific

and

1

Women

With
strike

issue, interest in rice moved up
appreciably for both domestic and
export use. Countries showing the
ket

Thursday, December 10, 1959

'A'

STATE OF TRADE AND

Lower

Chronicle

The Commercial and Financial

(2428.)

Two Partners for
F. S. Smithers Co.

days

drug company announced

F.

S.

Smithers

&

45

Co.,

Wall

Street, New York City, members
pressed stock turned right around of the New York Stock Exchange,
and started to climb
on
Jan.
1, will admit
up again.
Flechlin and Norman W. Stewan
If you are
going to "switch"
to partnership.
Mr. Flechlin w.
stocks try and
match the stock
a

new

compound

and

her

de¬

make

are

pated market action is concerned.
There is
a

client

and

his

headquarters

nothing that
more

take

a

can

than to sell

tn

loss

in

Form Trustors Corp-

irritate
a

(Special to The Financial

stock

it, in order to

LOS

Corporation

post with

are

Manuel Felix,

P.

Marsh,

doesn't

a

good

move.

and there

are

markets.

investment that

There

are

turtles

hares in the securi¬
If

you

trade,

swap

curities
5400

Chronicle.

^

Calif.—Trusters
is engaging in as J

ANGELES,

buy another stock and then see
the stock he has sold turn around
and recover while he is left at the

ties

in

buying with the stock you
firm's office in the Russ Buildingselling as far as an antici¬

you are

business

Wilshire

from

office.-

Boulevard. Officer

President:
Vice-President:

an<-

Volume

Number

190

5906

.

*

The Commercial and Financial Chronicle

.

(2429)
v

Our Reporter on

Alan Pike Joins

Blyth

SECURITIES

OWEN

BY

SAN

ELY

Pike

F.

Coast

on

FRANCISCO,

tional

has

Division

partment

of

the

of

Blyth

Institu¬

the

Sales

De¬

Co.,

Inc.,

&

;

GOVERNMENTS

Calif. —Alan

joined

33

,

JOHN

BY

T.

CHIPPENDALE, JR.

Russ Building.

New

of

lation

2,330,000.

ever

business

i
'

earned

Larger

sefved ■ include Providence
Rhode Island and Worcester,

1951

to

help of

a

5.6%

Sept. 80, 1959.

printing,

and

chemicals,

food

-

and

of revenues

gas

most of

the

sales

are

remainder. -'Residential

40%

contributing about

high,

Department

Utilities

allowed

rate

in¬

and

failing

for

revenues; the balance is
commercial, 25% industrial
and 8% wholesale to other util¬

would

about 10c

;

elec¬

about 23% hydro, 57%
steam and 20% purchased power.

factor in the increase.

150,000

ing

The

system

capability to nearly 1,500.000 kw,
compared with a peak load in 1.958

1,360,000. As a result of the
postwar expansion program most

in

Last

year's

capped

sales
the

by

company

is planning for an
unit in a new

225,000 kw

station

Point in Sum¬

at Bravton

handi¬
in the

recession

first

half, but this was more than
offset by good hydro output, lower
fuel costs, colder
weather and
above.1

rates

in

increase

moderate

/

.

the

in

and ;worked

was

mean

Municipal

tight

a

from which

position he recently resigned.

with

merset, Mass. near Fall River, to
be

completed by 1961. The 225
acre site is capable of eventually

in

90c

the

Ira

The

that

securities

short-term

available to

liquidity investors
going up in yield be¬

are

He

93c compared

previous

corre¬

despite subnormal water
conditions during earlier 1959.
England Electric System

been

selling recently

New York Stock

19%.

Based

idend

rate

proximates

on

the

on

Exchange around

the increased

of $1.08,

5.5%.

ment

i-

■<

j*

.[

div¬

the yield ap¬
stock

The

has

of

areas

market

this

the

feeling

are

govern¬
some

of

for funds,
but the
competition here is coming

rivalry

main

better

from

Debentures
.i

distant

and

Haupt & Co. r

Offers Dilbert's

yielding corporates
bonds.

and tax exempt

wf**

Haupt & Co. is manager of

underwriting group which is of¬
fering 'v in
units
$2,500,000
of
twenty year 5%% convertible de¬
due

bentures

Dec.

shares

600,000

of

1,

and

1979

stock

common

of Dilbert's Leasing and Develop¬
ment
of

Each unit, consisting
principal amount of de¬

Corp.

$50

bentures and 12 shares of common,

stock, is priced at $51.20, plus ac¬
crued interest from Dec. 8, 1959.
shares

common

and

de¬

the

will not

unit

the

in

in

unless

convertible,
previously redeemed, into
stock

common

version

are

at

initial

an

price of $3.75

per

con¬

share.

The

debentures are redeemable at
optional redemption prices rang¬
ing from 105.50%
to par, and
through the sinking fund at a re¬
demption price of par, plus ac¬

crued interest in each case.
Dilbert's

Leasing

a

&

market is still in a
restricted vein in spite of some
year-end help in the form of pur¬
chases of Treasury bills
by the
Federal

Develop¬

and

Banks

Reserve

sure

gas

has been under some pres¬
the SEC to dispose of

from

properties; at one time a sale
was under negotiation

of all units

but the plans for public financing
not consummated.
In 1958

were

Common Stock
offering of 280,000 shares of
Bar Chris Construction Corpora¬
stock at $6 per share

Narragansett Electric sold its gas has been made
through the un¬
in Westerly, Rhode Island, and the
derwriting firm of Peter Morgan
parent sold its investment in Pe& Company. Proceeds of the issue
quot Gas in Connecticut. Negotia¬
tions have been pending for the

will

be

used

for

working capital

and

expansion purposes. The com¬
sale of remaining gas properties of
pany's principal activity is the de¬
Narragansett.
If successful, the
sign and construction of bowling
company feels that it will be in
alleys.
the sound position of having all
A subsidiary, B
& C Bowling
gas properties concentrated in one
Inc., is a supplier of
state and it believes they will Supplies
then constitute a single integrated bowling equipment in New York
City, Nassau and Suffolk Counties.
system, which might satisfy SEC
requirements.
New

England

Electric

With Walston Co.

System

has also beerrtrying to reduce or
eliminate publicly-held minority

LOUISVILLE,

interests

Broaddus

five
plan

stocks of
subsidiaries, and a

in the common

electric
toward

this

end

proved

by the SEC and
pellate Court, becoming
June 30 this year.

was

ap¬

member

the

in

cash

banks

excess

of

use

in

a

stock

30%

New

England

interest

with

Walston

is

Ky.

—

now

&

vault

of these measures

easing

However, the demand for funds
is

very

modest

sizable and despite the
easing of conditions by the

that be
the restrictive
policies of the monetary
authorities are still very much in
powers

credit

evidence. The fact that vault cash
can

be counted

part of the re¬

as

of the deposit

serves

the

Federal

not

mean

Reserve




return which is bet¬

a

ter than that which is available in

the savings banks

and government,

Co.,

Fannie

The

v

,

.

Offer

Exchange

May

Just
over
$188,000,000.. of the,
23%s of 1975-80 (non-marketable)
in

turned

were

Federal

for

at

gages

of

price

average

an

Na.^

mort-i

tional Mortgage Association

102.03, which gives a yield to ma¬

restraint

the

money
are

which

market.
the

mature

in

15

and

years

they should aid the marketability
of the

new

other

owners

portfolios. An-,

expected

exchange offer is

in the not too distant future.

i

R. A. Pauli With

A. G. Edwards Sons
(Special to The Financial Chronicle)

ST. LOUIS,

Mo.—Robert A. Pauli

has become

associated with A. G.

Sons, 409 North Eighth
Street, members of. the New York

Edwards &

ones

been

has

The
that

Richter
had

Exchanges;

Stock

formerly

was

the

in

department of Scherck,
Company, with which he
associated

been

for

many

years.

With Fusz-Schmelzle

on

get

Pauli

trading

(Special to The Financial Chronicle)

smaller
will

Midwest

and
Mr.

System does
a change in

fix¬ selling

government

securities,

term

common

moving up to all-time high levels.
The
competition
for
available
funds in the short-term
market

shares of Dilbert's Leas¬

&
Development
standing.
ing

ST.

LOUIS,

Mo.

Milton J. H.

—

Gehrs has been added to the
of

&

Fusz-Schmelzle

Boatmen's
bers

of

Bank

the

New

Building,
York

staff
Inc.,

Co.,

mem¬

and

Mid¬

west Stock Exchanges.

then

out¬

Specialists in
U. S. GOVERNMENT
and

FEDERAL AGENCY

SECURITIES

government issues have been

has been very keen and is quite
the current likely to continue that way for a
financing, outstanding capitaliza¬ while, although a moderate easing
tion of the company will consist in
these conditions
could come
of
$2,500,000 of the debentures after the turn of the year. The
now
being offered; $427,602 of monetary authorities, to be sure,
mortgages payable, and 1,239,250 could make things less restrictive
shares of common stock.
but such a development is not ex¬

effect

Giving

to

Russell

pected as long as the economy

connected

Inc.,

of

mainly the short-term ones, by
corporations. In addition, the re¬
building of inventories which is
to now taking place and will most

with the result that rates on near-

Joins

321

Newhard, Cook

in

LOUIS, Mo. — Leo J. Conaty
become affiliated with New-

hard,

(Special to The Financial Chronicle)

Olive

Carole B.
Nelson
has
joined the staff of
Townsend, Dabney & Tyson, 184

New

Middle Street.

Sons.

Cook &
Streets,
York

Exchanges.

viously

an

On

(Special to The Financial Chronicle)

Joins Townsend, Dabnev
—

and

the shared held by Dil¬
Quality Supermarkets Inc.
will constitute about 45.2% of the

South Fifth Street.

PORTLAND, Maine

saving's bonds.

that there is

the

banks

institutions of

offered,

has

a

af&,

tractive to those investors who

looking for

and credit con¬

money

ditions.

bert's

ST.

(through

obligations.',
However, certain of the recently
offered government intermediate-

have the effect

guaranteed unconditionally as
principal,
interest and
sinking likely continue for an extended
fund
payments
by
Dilbert's period of time unless the steel
Quality Supermarkets Inc. Upon strike is renewed is also taking
the sale
of the securities being funds out of Treasury obligations

the Ap¬

and has

attrac-'

more

the Federal

than

percent¬

part of their reserves. Both

ages as

of

to

stated

supermarkets and
self-service stores. The company's
debentures now being offered are

effective

New England Electric System
has been actively interested in the
construction of an atomic power
reactor

(Special to The Financial Chronicle)

Jr.

machinery

equipment,

tures for use in

An

common

that still make them
tive

and
yields

giving

are

& Co.

Offers Bar Chris Co.

tion

bonds

free

the

permission that has been given to

a

Peter Morgan

pany

market

have also been feeling the compe¬

usually

The money

be

separately transferable until Jan.
10, I960,
:
The debentures

Money Market Still Tight

an

relatively
narrow
ment Corp. was formed for the the greater benefit from this rule
range this year of 211//4-19%, com¬
1,000,000 kw plant.
pared with the 1958 range of 19- purpose of engaging in the busi¬ change since these institutions by
The company has also purchased
ness
of
investing in, acquiring, necessity
have
to
carry
much
14V2.
At
the
recent price
the
a power
site on the Connecticut
price-earnings ratio approximates constructing, financing, managing, larger sums of cash than do the
River in Gill, Mass. and may ac¬
banks in the principal money cen¬
15, based on estimated earnings of operating and developing shopping
quire two other locations.
centers, supermarkets and other ters of the country.
$1.30 for this year.
•■
The system has almost doubled
types of retail stores. It may also
Short-Terms Under Pressure
its gas revenues since the change
engage in the business of invest¬
to natural gas was made in 195z;
The need for funds to take care
ing in, developing and improving
other types of real estate. The of income tax payments as well as
last year output was over 10 bil¬
lion cf. However, the parent com¬
company
also intends
to lease dividend disbursements has led to
supporting

traded

sectors of the government

turity of 3.71%. These mortgages
Ira

The

plished

'-"as

long-term'

market and
happening attthe., teymM.issues, Jiave been at prices,
which have again made them
at^,

money

is what is

that

development

institutional " sales,

of

Mixed

Sectors

Market

The intermediate and

tax

tary

Department present time.

•

equity market.

authorities are showing no
signs of making changes in the
policy of active credit restraint.
All of these forces taken together

of

charge of

the

Other

which has

money

out of the

tition for funds since corporate

■

sponding period and 86c in the
1957 period. This gain was accom¬

New

pounds in 1949.

The

Pike

;.

bentures

pounds of fuel to produce
kwh
compared
with
1.21

initial

this year.

were

In the first nine months of 1959

steam
units.
Fuel
per kwh was
reduced 6% last year; it took only

.....

they

1957,

estimated at about $1.30

mentioned

high-pressure
consumption

0.81

Declin¬

year.

$1.19

1o

1954 and

$1.16 in

to

oi electric generation is now sup¬
share-earnings wefe
plied, by hydro plants and mod¬

one

'

Poor's)

&

Standard

following

again

the

o|

ern

to
,

recovered to $1.26 in 1958 and are

Harbor

Salem

kw

Steam unit increased total

by

the

$1.24

doubtless

(added

was
new

equivalent

share..,

a

but declined

Hydro output in 1958 hit an allof 1,478 million kwh, a
gain of 13% over 1957; the 190,000. kw Samuel C. Moore hydro

1956)

have» been

reported

time high

in

of

share earnings record has
irregular: earnings rose from
$1.08 in 1948 to $1.43 in 1950 (as

was

a

increase

an

been

plant

F.

of

amount

...

The

.

Last year system output of

tricity

other

obtain

to

electric

-

:

of $2.6 million in Rhode Island which

24%

ities.

Public

of

totalling $1,475,000,
applications
were
pending

two

in
Alan

ited
come

long steel strike. Also, the mone¬

Kidder, Peabody &
Co.

ended

In 1958 the Massa-,

chusetts

$375,000

86%

contribute

sales

months

12

because of the

not been available

Francisco

where he

brisk demand
refilling of the

a

the

for

pipelines with goods which have

the

office

funds

for

for. is a member of the San Francisco have been
cause
there is competition from
subsidiaries.
Municipal Club and
the San
The amounts received were equiv¬
legitimate business financial needs.
Francisco Bond Club.
This has taken buyers away from
alent to about six cents a share.
the Treasury offerings, The middle
The company was disappointed in

paper

products, and rubber goods.
Electric

the

for

creases

similar

and

San

tern

1953

joined

this is the usual pat¬
at this time of the year. In

addition, there is

since

In

1938.

he

very

1954, and with the
modest rate increase to

ford, Maiden," Everett and Gloucester in Massachusetts: Principal
industries
in
the
area
include
metal products, textiles and allied

a

and credit

is strong and

United

the

States

in

5%

Lowell, Lawrence, Quiney, Med-

lines, electronics,

in

The demand for money

in

cities

various

high rate
of return during the past decade.
However, earnings on invested
capital increased from 4.5% in

cities
in

not

securities

the

in
Yankee
Atomic
England Electric System,- subsidiary)
annual revenues of over Electric Company. A 134,000 kw
is
being
constructed
in
$167 million, is the largest electric plant
and gas utility system in New Rowe, Mass. and is scheduled for
England, and constitutes one of operation late in 1960.
N ew England Electric System
the nine large holding company

with,

has

has

been active in'

New

systems still remaining in the
hj, S. The 23 subsidiaries render
electric and gas service to a popu¬

Pike

Mr.

England Electric System

term

whey

the other

rates
have

are

is

is the case now.

hand, high short-

and

Midwest

Stock

return which is

A.

G.

Edwards

&

ury

Aubrey G. Lanston
6c Co.
INCORPORATED

attractive to those

funds

and

in

time

Co., Fourth and money will find its way into these
members of the obligations. For the present, the

Mr. Conaty was pre¬

with

upsurge as

available in Treas¬

bills is bringing foreign funds

into these issues, as

well as a lim¬

20 BROAD

STREET

NEW YORK

☆

CHICAGO

☆

☆

BOSTON

34

pinched
onri
and

Measures to Sustain

between

rising expenses
growth in
eross revgrowth
in gross
rev

q
a cinwpr
slower

Banks' Profit Position

bankers do about it?

from

of'these

institutions

In

e

in

Compete More
Effectively?

__

,T

.

Nevertheless,
other

®

even

unsound

practices of some
savings and loan associations were
to

be

corrected

which■

"W

appears

in^ment-the ability of
ba^ks to attract savwill

.

depend, in the long
wh e t h er they can

upon

e£i°U?£
For

?ay

un,

earn

+

thts

banks,

raises the
question of whether they will be
able

many,

;tp improve appreciably their

earnings

their

in

depa t

savings

ments*

This

problem
analysis.
First,
consider

deserves

however,

whether

To

with—let's

bankers

enthusiastic

about

while

are

do

not

even

try in only a
For example,

way.

banks

it—

devotedly

competing for

Some

others

halfhearted

face

not

are

this business.

some

showing in

savings has been
to their handicaps.

begin

try,

us

for

due entirely

some

let

commercial

banks' relatively poor

competing

careful

content to let their

fUg if

departments with earnings really
attributable

the

to

investment

of

^

maintain

8% profit
ratio, what will happen to their

Some

bankers

this statement.

banks

many

Yet the fact

do

is

that

analyze

not

_

,

go

might

but certainly
the

deposits, they might be surprised
at the results.

It should also be recognized that

banks have advantages as well

in

competing

personal savings.
ones

that

are

as

for

Their two chief

they

financial

are

department stores rather than specialty shops and that they have
the

enormous

banks.
these

By

prestige

making

of

the

being
of

most

^advantages and by other

promotional policies, many banks
have enjoyed considerable success
in

attracting

savings.

Nevertheless, the basic question
of

earning capacity is still the key

to the future
cial

growth of

commer¬

bank

savings deposits.
So,
what will happen to bank earn¬
ings?
The Coming

Squeeze

On
of

basis

the

of

paint

a

trends,
gloomy picture

propose to do

then to suggest

In
just that and

policies that

some

levels.

present

of

be

cannot

therefore

that

Over

the

pnrnintfR

a e

f^

will tend

past

decade,

substantially

gross

banks

but

so

have their
operating expenses. As
a
result, there has been no improvement whatever in the rate
of

profits earned

accounts.

on

bank capital

It has remained around

a"modest level
level. thlS penod' surely
a

modest
1 nis

ing

record

when

you

traordinarly
Stances
have

is

iar from

reassur-

consider

the

favorable

under

which

banks

operating.
The
Standing fact is that banks'
dollar of
than doubled.

per

ex-

circum-

the

been

earnings

outgross

deposits

have more
This has
reflected the
strong upward trend
of interest rates
from very low to

relatively

high

levels

and

the

qi'adrup mg of bank loans.
rapid
At

dSi'ie

the end

of

Some

That

is

picture

Silver

the

and

War

II, almost all banks had
superabundant
liquidity. Since then, the
average




able

adaptability
tions.
bad

changing

to

the

figures

it

re-

membered that the average profit
ratio of 8% includes
many banks
which have
been earning more
and

a2s0

Generally speaking, the banks
which have already shifted substantiallv into
assets

in

are

earnings

higher-yielding risk
a

reasonably

position.

considerable

good

Banks

earnings still

poorer

with

could

amount

of

do

problems,

exhausted

by no
ability to

something about them.

many banks may be able to reduce

tnrnnvpr
turnover

»'

hnpn
been

ic
is

the

over

past

Hcincr

nsing

decade.

standpoint of banking
operations, this means that checking account activity and the cost
of handling these accounts
have
,

increased

more

rapidly

than

the

volume of deposits,
;s another

on

trend

thnt

same

rm-

at least

pace> but lhig

Qne

the plus side of the

ledger.

If the

rise in

earnings
deposit ve-

locity slows down over the coning
decade, as seems highly probable,
this rising trend of bank
costs per
deposit dollar should slacken
Nevertheless

desnite

too

thevp

Ril

verxneiess, despite these sillinings, it seems clear that

adequate profits

are

going to be

much harder for banks to

than ln recent
yea,s.

^

complacency.
tbe Profit margins
will

in

elec-

produce

Perhaps it
seen,

will

done

out-

an

have

under

do

so

around,

way

all

come

Good

by

earn.

^ ™ —

Sooner

or

later,

of many banks

likelihood

tend

years

liquidity

to

be

Still

Too

I

tion

with

But

increased

important,

alter

member

High

bank
some

From

«

-

going to need far
of

earnings.

gross

get them?
,

in

more

How

To
are

the-way

_

,

th!

most

un-

productive

and

frozen

asset

the

employ

Also, they obviously
pressure

of

more

their

non-liquid

maintain

banks

on

investible

than

assets

be

passable

to

to

necessary

earnings.

they

Liquidity

Generally speaking, the easiest
for banks to acquire more
eainings is
is
by
acquiring
more

words,
bank

assets.

the.mam

In

other

lies'm

answer

lending policies—using this

.

.

.

.

!!1

include

enSe

bank policies with
respect
respePt to asset

competing
ompeting with

other lenders.

reserve

ably

requirements

higher
that

and

n

than

this

banks.

be

ay

a

is consider-

it

needs ,to

constitutes

Unless

opens

several

up

be

commer-'

than

in the

this
in

matter

past.

basic

One is whether liquidity standards of commercial banks
be

further

revised

conditions.

into

the

account

Reserve

other

of

Fortunately,
autliorities

deposits and
which have made

changes

l'ar

less

than

of bank

vulnerable

formerly,

to

deposits
deflation

should

bankers

generally be less concerned about
liquidity than they are? Are some
bankers

perhaps making
overliquidity?

This

fetish

a

Reserve

not

a

achiev-

progress toward

sensible

more

It-

is

that

their

opportunities

they

progress

reserves

certainly to be
will be alert to

hoped
h0ped

to

in

make
m
a k e

this direction

the years ahead.

over

more

mutual

com-

petitors.

Tbe Problem of Pledged

r\

Securities

Another
that

more

assets

of

handicap

mortgage

loans

held by commercial banks amount
to loss
than 40%
of their total
time deposits.
This suggests that
there may be
many banks
which

.

could

safely

ment.

their

and

profitably

mortgage

have

met

v..

credit

J

union,

v

.

petition but have
aU^

,

.

done

nothing

:;^n?,SV!e could

go on. Many
33can"

J*
P

v T?p^a
0
t>pes of
Jcndmg. It seems clear, however,

that

banks

some

than

more

•;

And

to"

tbe

other

rapidly

dS. 'S

advantage

of

0ri<.inatfn"
tbe

have

servicing

for

mort-

other investors,

saine

some

ex-

taken,

opportunities

and

gagtoes piaced'with
J ^nd

for

areas

banks

some

annlie;

romment

snmP

w«es

"rowing

amp]e"

be able to

may

they have done to

dat"

H.ay

already

as

banks'

have been

competing effectively for savings
deposits, while others have not.
Banks

can
get a
business if

this
after

it.

goodly share of

•
they really go,
they won't if they

But

aug-

portfolios,

Banks whose local credit
demands

.

than $23

For

this seals off
of

banks'

is

the

billion

to

•

.

fact

of

banks

Would

bank

\Tgorous

more

policies

inflationary?'

be

they perhaps accentuate a
contribute to bringing

and

bust?

on a

Well,,
bank

they

might

in-the

if

—

every,

United- States

were,

suddenly to pull out all the stops;
and leave them out. But that, ob-

viously
The

is

not

worst

the

best

going

that
is

—

happen.

to

may

happen—or
happen

that

banks

may

gradually continue to shift toward
enterprising

yielding
them

policies,

investible. funds,

keeps
relatively lowsecurities,
and
makes
for

general

Is

this

securities

This

decline

system

really

in

bank

of

pledging

necessary

under

present-day conditions? Should it

would

enable

banks-

to

improve

lending capacity and

better return

on

to

earn

from

Opportunities
bank

lending

the

much

how

does

banks

absolve

not

responsibility in connecwith
credit
conditions,
of
Banks do have

course.

obliga-

.an

adhere to sound credit
standards. When business is boom

tion

to

ing,
to

is

it

avoid

important

particularly

lead to
losses,
bankruptcies
and credit
.liquidation when business turns
loans

7

_

downword.
can

that

may

A

Indeed,

this

prob-

is

whereby banks
contribute
to economic

abiy the chief

way

stability.
But

other

policies generally? Are they more
conservative than they need to be?
My answer would be: In some

of

not

determine

this

does

banks should sit
'

Federal

all

tion

these funds?

Profitable Lending

Now, what about

authorities,

to

It is

"definitely no."

bank credit the economy should
have at a given time. Within the
limits permitted by Federal Reserve • policy, there is no reason
why banks should not compete
vigorously for profitable types of
loans of good quality,

purposes.

the

be

clearly

would

answer

responsibility of the

Reserve

purposes,
substantial portion

unavailable

liquidity

the

banks,

public

secure

to

seem

the

practical
a

The

are

them locked up in

a

Would

lending

omy?
.

commercial

pledged, mostly
deposits.

their

example,

fi-

competition,-by taking banking
s5lvf®ni|°t worKers in their
pi^T:s- ^ers aepiore this corn-

more

conservatively than
they not be possible to work out some,
really need to—especially by com- alternative
arrangements which

For

estate

Would this be bad for the econ-

With

so, simply as a matter of
internal
control, many might
find
that
they are investing these fun 's far

their

real-

field^ n6W opportunities in

,

applies particu- liquidity, this situation now conlarly to the investment of savings siitutes
a
serious
problem
for
deposits. Most banks, of
course, commercial banks. It clearly
may
do not allocate
particular assets to become more acute
over the years
these deposits. If
they were to do ahead.

with

interim

Some

-

of

unaware

question

parischi

other

.

some

structure.-

Taking

development of
policy, Federal

the

arc

•

irig
ing

under

bank

the total volume

of

boom

-

^is problem and have been mak-

questions.

present-day

e,3 P. ®nns,

dis-"- don't.

a

rectified,

serious

more

the future

further
This

™lanf?hLP. ^

mentioned,

To those who understand the
banking business, it is clear that
the overall level of member bank

way

high-yielding

i-

.

til^r

do

constitute

reserveS

.cial

.

,

of Bank

re-

standpoint of bank
management, these high required

criminatory handicap to
■

,

umeed

,

can.

.

1 roblems

reserve

member banks

the

otherwise

not^ suffice.

guaranteed

s

^

nancing ron a sound, profitable'
basis. Others have paid no atten-.

are
less liquid than they should
be, one reason is because they are
required to sterilize so large a
portion of their assets in the form
of legally required cash reserves

might

efficiency, while

will

-

.

„

.

this

increasing
years

,/

CO

in

the

mort-'
gages' °thers are content to hold,

mostly Govei
Government

themselves, of course, have imUUJ. tCtXIL
portant
jJVIHOl Uill LICO All
U1U1^V>~
responsibilities
in ^
connec-

funds

over

acqmred substantial'.

a

Requirements

-

not.

^

of

not continue indefinitely,

not at the

is

Some

;

pui hiutiUb Ui. conventional
gages. Others

The Federal Reserve authorities

quirements. If

that

others

be

to

insurance

the

This

more

Others have'

"1

•

Some have built up a good
vol
ume -of term loans to
small bus"
ness_ others have not
;

types

Reserve

ahead.

should

There is also the
possibility that

rapidly

be

other

a

have

their

with

business.
•

respect Piovement
Irons. Ottere tal*
liquidity will constitute a prob1 tn
applicants
i™,
imnnrfanpp
fn -happen to apply.
lem of inprp^intt
increasing importance to
Some have
developed various
bank management.

VW**04V»V1MWAV

can

have

a

further

words, the banks likely
faced with the most serious

From

^

to

that

will

pressure

.

shifting in this direction.

means

v

this

the

means

They

which

many

have been doing relatively poorly,

do

this

„

tban

however,

banks hnv#'

some

to

this

in

maintain decent profits, banks

thing, it should be

one

Uv,eh'

these

whether

Looked at

as

indicated

should be.
por

rpflsnn-

Over the

DroKts

standing job of improving the bank owns.
efficiency
of
their
operations." add to the

condi-

Its fate has seldom been
as

parn

of

;

appropriate-policies with

to

howappreciably slow the rise in operating expenses for the industry as a
whqle.

be

laughed away. Fortunately, how¬
it is not the complete story.
the years, the
banking industry has exhibited remarkable

*

confident

are

Some banks

cannot

F

It remains

can.

Linings

that

u

equipment

ever,

gloomy side of the
one

v

substantial economies.

squeezed.

ever,
Over

'ngS at
World

tronic

a«

to be

^

bankers

arp

over the years ahead.
As
they do, it seems clear that, somewhere along the line> profit ratios

dpnosit.
deposit

commercial

banking

Can this trend be curbed?

nien

tifS A
l^orable to bank earning

SUCxl an

earnings of
have risen

competibusiness,

in and year out. They have
then tripled since 1946.

.

f

fr»

types

ade-

liquidity problem
expenses, both in their
supervisory capacity
have been rising inexorably year and
also through their power to

Federal

sssaswar
unhappy fate.

the

mechanization,

from 15% to 5%

Wp

alUo

loan

never-

in prospect on bank earn,
ings positions'*1 the formulation

area.

capital to risk assets
permitted to
decline

nhvion„

have

and

squeeze

keen

ment

most

than

No

50% to 80% and

ratio

because

more

example,

hot.-

very

ex^nditures-..
^,'SSntiany" reduced'' and^wtth
if we

maintain

VkJ»

the

hoou

ffood

figure, gross earndonar of bank deposits

future of bank profits.

fact, I

m

had

uY fu pl0t,ts-

matter how you

to be

certain

ti°n

liquidity

^hii

But the great bulk of banks' op¬
erating expenses, of course, go for
providing financial services de¬
ings per
sired by the public and for reare not going to double again over
taming
and
attracting
the next decade,
savings
deposits.
Despite considerable
similarly, loan - deposit ratios
progress in the way of increased
cannot rise from
from

earnings

the

could

one

to

serious

quate
thnlocc

± ahead,

some
are inevitable

so, banks may be
achieve some economies

they have rjsen since
indeed, they could easily

In other

Profits

wish

too

resource^
developing

in

sound

outstandingly successful in
developing their consumer instab

individual banks

have

tewaste

very

Even

they cannot rise at

pace

1946

reCede

Bank

on

higher

somewhat

However,

this kind

of

n_

rates

the

they were to do so on a
realistic basis, including a proper
allocation of their assets to these

+h

f

inde£initely.V Interest

If

disadvantages

fh

nQt cantinue

profitability of their savings busi¬
ness.

ful.

seems

For

differpolicies with mespect to liquidity. in the past, this has not
been

and

been

ent

banks

others

it

hand

lending.

read

following

been

be. On the other
bankers are more

ful
than
profitable

.

.g clear

ftave

to

may

12>

^

^

one

-this doubtless

™^d?herl these trends come

„

might challenge

meager

a

Nov>

competing with one another—expenditures, for example, on entertainment, travel and various free
R^rvincs. Looked
Looked at.
services.
at, sav
say from
from SatSat
urn—or from
Moscow Univers ity

since

were able to
do
under these conditions was barely

they

level off

savings deposits.

could

th

eyer

begt

busi-

thing—though they are
by no means alone in this—banks
spend considerable sums simply

Gjven these trends, banks should
have been able to earn really good

savings departments grow slowly
and to subsidize their commercial

For

Let

applications

should
some

A. L.
on this in the
1959, Chronicle, p. 3.]

wish
Mills, Jr.'s article
reaoer

ness—though perhaps not to the
extent, that some bankers assume.

than 15%

loan

on

bankers

tbey do—as Reserve Board Governor Mills recently pointed out—

is in-

this backwardness

herent in the nature of the

banks' capital ratios
substantially. The
average ratio of capital to risk
assets has dropped from 25% to

commercial
ings

extent,

declined

have

a

banks may still be

passing

liquid than they need to be,

Output per manhour has not in-, they may impair their capacity to
creased as much in banks as in fuifm
their short-term community
many other industries.
To some lending duties. [Ed. Note
The

accounts,

Can Banks

is

In

■

some

no.

as

respects, of course,
backward industry,

some

banking

Many bankS now feel that they
public interest. Is it not «*Iso in
anoroachinfi a fully loaned
the public interest to safeguard
the soundness of savings and loan P°siuun.
At the same time, despite sub¬
associations in the same manner?
stantial additions to their capital

ways, yes; in other ways,
explain.

me

are
generally conserva'
tive
in,, appraising
the
credit"
others may be in danger of going worthiness of would-be
borrowers"
too far in the other direction. ,If and this, I
believe, is just

More

Banks Become

Can

risen

oitar41

page

.

While

more

Efficient?

Continued

Thursday, December 10, 1959

..

some

gages.
can

.

small might consider investing
funds in out-of-state mbrt-

are

e n lies.

What

ness;

Chronicle

The Commercial and Financial

(2430)

to

lenders

most

of

business..

to

hot

moan

that

permit

back and

help themselves

profitable lending
should
short banks

the

In

laxity but should compete
actively for sound loans.
avoid

.

It

should

also

be

emphasized

Volume

190

Number 5906

The Commercial and Financial Chronicle

...

(2431)

35

that banks can and should couple

Complete Puerto Rico Bond Sale

aggressive lending policies
equally strong competition
personal savings. In essence,"
this would mean that commercial
banks would be performing more
f the savings-investment function
that
would otherwise be per¬
formed by other institutions. In¬
deed, if banks fail to maintain an
important roLe in- this area, the
effectiveness of monetary policy

more

with

New Capital

Spending Seen
Going Up Substantially in 1960

for

will be further reduced.

:

Industry plans 10% rise in 1960's capital investments over
1959, with
encouragement provided by prospects of
higher sales, according to
McGraw-Hill survey.
However, the bulk of corporate finanoing is
expected to be achieved from internal sources with less
than

20%

to be

Industry
It

without,

goes

xpent an

that"

respect. However, - with liquidity
and capital ratios, now substan¬

reduced-,

tially

many- banks

tinues

another

is

thumb

in

sion.

Bankers

alike

will

to

;

give

is

a

balance
While

adequacy

be- the

prime

banker

;

of ' appropriate
individual bank.

the

of

also

must

capital

on

tain

adequate

an

rate

of

profits.

In competing for capital, banks

Puerto Rico, fiscal

Development Bank for

•

.,

issue

bonds

or

ferred stock. In view of the

pective squeeze

perhaps
to

reconsider

modern

pros¬

the

now

come

validity

conditions

under

of. the ancient

taboo against raising Some portion
of hank capital on a regular basis

by'

of

preferred
debentures.

means

capital
A

or

Challenging Future

These, then, are
by no means all

some—though
of

-—

problems

which

stock

and

banks

the

major

opportunities
will

with

be -confronted.

Clearly, the years ahead will de¬
mand
imagination and skill on
the

part

Banks

of

bank

which

management.

fail

to

changing conditions

adapt

will

to

have

a

rough time,,

tion

play

can

No

in

other

industry can boast the
widespread educational programs
that

banking

training

and

has

developed

educating
executives,

its

ployees and
fronvA.I.B. courses

for
em¬

ranging

to the regional
banking
schools,
The
Stonier
Graduate School of Banking, and

seminars for senior hankers such
as-this one here- at Arden House.

Banks which take full advantage
of-

these, educational facilities will

have

an

important edge, I believe^

over those which

[Traintaining
hank's

a proper balance in a
safety, liquidity and earn¬

positions

will

in¬

become

creasingly difficult. Some of the

[actors
which have helped to
tain
bank

Hll

profits in recent

become

ma'iy

counter

are

difficult

leins.
•In

less

banks

most

years

Policies,

and

likely to en¬
earnings prob•

however,

eases,
can

■nai.ageriai

sus¬

favorable,

"

problems

solved

be

policies.

there

stock of Faradyne

mon

ics

200,000 shares of com¬

7

Dec.

is

no

these

by

alert

With

such

reason

why

Electron¬

White, Weld
Sell Talcott Notes

will

An

underwriting group headed by

F.

Eberstadt

or-nothing best efforts" basis by
an
underwriting
group
headed

sale

were

Netherlands
Securities Co.,
Inc., which handled the books,
and four other firms.
by

Weld

company

due Dec.

r

i

t'le

olumbia

Graduate

Management

School

University,
"arriman, JVev York,

at

of

Program

Business,

Arden

Nov.

9,

White,
public
$15,000,000 of James
for

Both issues are

1, 1979.

engage

senior notes and capital notes will
be
used
for
general
corporate

the electronic

purposes.

Saul

Birbaum.

1.

It

proposes

to

It

forms.

wire

tungsten

precision

and

outstanding

has

300,000 shares of class A common
issued to the four promo¬
ters in exchange for all the out¬

stock,

which was owned
by them of Micro-Wire Corp. for

standing .stock
nn

investment

The company

Microsubsidiary.

of $20,000,

becoming

Wire thus

a

plans to design, test,

develop, manufacture and sell a
variety of electronic components,

emphasis cm the de¬
velopment and production of di¬

with special

and' electrolytic

tors, and precision
will

operated on a
basis consisting of the

It

forms.

capaci¬

tungsten wire

divisional

be

Capacitor Division and the Micro Wire Division; the former plans
to

its

initiate

line

of

dielectric

capacitors with the production ol
dielectric capacitors and
the latter to design, develop and
plastic

precision
tungsten
proceeds of

manufacture

wire forms. Of the net

stock

sale,

$250,500

will

plied to various purposes
ment, etc.)

and

furnaces
for

the

ap¬

(equip¬

related to the capaci¬

division,

tor

be

and

$75,000

for

winding equipment

Micro-Wire

Division. An

James

\

m

expenditure of $50,000

industrial
ceivable

In

accounts

re¬

and

30,

nine months ended Sept.

the

the

1959,

ables

of receiv¬
the company

amount
by

processed
to

amounted

$748,331,000,

com¬

pared to $606,709,000 in the same
period of 1958.
Net income was
$2,461,770, equal to $2.41 per share
on
955,557 common shares out¬

standing, compared with $1,631,271, or $1.91 per share based on
the same number of outstanding
shares.

On Nov.

dividend

was

the quarterly

10

raised from 33 cents

the

over

1959.

higher

major

Sales

new

the

Office

BrCcker,
the

has

S.
by

firm

investment

Co.,

members of
Stock Exchange.
Mr. Brecker

Daniel

announced

of

been

of

the

was

Bache

New

&

York

formerly

Manufacturing companies plan
increase spending by 19% in
1960
iyou—to
a
total
of $12
billion.
These
companies
already
have
plans to spend $11.2 billion in

new

Hotel,

Companies
in
every
manufacturing
industry
sales

man.

Mrs.

Ruth

and
B.

purposes,

including salaries.

steel

a large
I960, as

build-up

replenish stocks down

users

in

1959.

The

auto, trucks and parts industry expects sales to increase
15% in physical volume next year,
,

Both

the machinery and elecmachinery industries exPect an above average increase in

trical

voiume

Gains

of

11%

are

expected in both industries,

Q
U.

T

Wi4-"U

JLi. J ORHSQH W Itil
•

TTT

1

1

WGUDGF

13,1116,

j

o r

expect

be

to

L; ^?h,.ls0111' one .°*
f

lew women

brokers in San Francisco,
joined the office of Paine,

Webber, Jack¬

volume.

son

&

369

Pine

Curtis, "

St.,
registered
presenta-

as a

Business

billion

$6

over

market

plans
to
raise
in
the
money

now

finance

to

expenditures. But

financing

as

—

1960

over

r e

tive.

capital

planned

by

all

their

In

planned
internal

these

the

billion

which

in

1959,

2%

increase

invest¬

cisco

firm

ment

of

Stewart, Eubanks, Meyer-

expenditures

son

sources.

&

Co.

Miss

will spend $1.2
plans to increase

expenditures 24%
already has plans

with

the San Fran¬

manufacturing, the chemical

industry,

was as¬

sociated

reporting companies — will come
from retained
earnings and de¬
preciation.
Manufacturing
com¬
panies expect to finance nearly
from

She for¬

merly

80% of the

son

Sandra

L.

Johnson

the

John¬

entered
securities

business

four

in 1960 and years ago, after graduating from
for an addi- jthe University of California at
in

1961.

The

plans to

Berkeley.
Finding

a job in a profession still
predominantly male was not easy,
especially for a young woman in
her early twenties. It was only by
Many See 20% Gain
dogged persistance she got her
Electrical machinery companies, first job—as a board marker.
It
now

$1.2

the

apto, trucks and parts indus- was not long before she absorbed
the
paper
and
pulp
and enough to qualify as a registered
manufacturing industries representative. Miss Johnson says
all plan gains of more than 20%
most of her clients are women,
in expenditures in 1960, compared She believes a woman investor is
with this year.
more inclined to divulge her fi-

try,

rubber

at

1960

plans for most nonindustries are up

manufacturing
from

in

1959
in

most

increases

are

varying amounts,
the planned

cases,

smaller

than

in

nancial status and goals to another
woman than to a man.
,

.

-fi

n

unn„p

Joins omitn, lvioore
(Special to T1«F.K»Nc.Atc

are

manufacturing. The Petroleum in.

ST. LOUIS. Ma-Robert E. Smith

David Feld¬

dustry plans to spend slightly lessi

Moore

Vineland sales office

Lambert

m a

higher in 1960
than in 1959. The average increase
expected
is
9%
in
physical

but

representatives

sales

SAN FRANCISCO, Calif.—Sandra

1961.

The

Camden, N. J.
Registered

the

asso¬

ciate manager of the Bache branch
office in the Walt Whitman

in

predicted by the

.

a

Landis Avenue, under

management

js

venr

increase

billion in 1960 and
nearly the same amount in 1961.

sales office in the East Landis

Hotel, 829

nevf

lar£est

steel

saleg

of

to

spend

New Bache

sales

are:

machinery industry

VINELAND, N._ J.—Opening of

sales

inventory
in

to

findings

optimistic

•

?ain Presumably reflects

rid

industry.

ajoi Findings

survey

by

industry—up 25% from 1959. The

rmw...
_

Other

.

a whole- Every major industry
within manufacturing anticipates

expenditures

Fluman

is

in

than in 1959. Production

House,




r

If °
? f caused
business' plans

1959

carried

*n u1957'

sp,

,

iSe estimates—9% higher than 1959,
m,Y for unit sales in manufacturing as

has stretched the capital spending
boom over a longer period.

tional

to 40 cents.

used

corporate

finance:

sales financing and rediscounting.

Arthur

appropriate

Inc., founded in
in all phases of

inventory financing',
mortgage, equipment and special
loans, factoring, industrial time

500 balance of the proceeds to be
for

Talcott,

of

charge of mutual fund sales.

tures

show

.

*

indi-

utilities

gas

ss P'ans f°r higher capiexpenditures in i960 are

supported

.

Ki

!rfc,li .—1..!^.

their

is engaged

1854,

expansion and improve¬

before the

and

offered

was

contemplated, the $430,- the

ahead.

years

Dec. 8

on

Co.

&

The capital notes are converti¬
organized
under New Jersey law on June ble into common stock at $49 per
3, 1959, by Manny Brucker, Presi¬ share until Dec. 1, 1964 and at
dent, Sol
Feldman, Bernard P. $56.75 per share until Dec. 1, 1969.
Proceeds
of
the
offering
of
Eirnbaum, Board Chairman, and
The

ments is

the

Dr. Adams

Co.

&

tal notes at 100%.

for plant

over

inw

-u

1960, and
with 1961 plans already at high
levels, it appears that the strike

Talcott, Inc. 5',•>% senior notes at
99%% and $7,500,000 of 5% capi¬

and

address by
oinmercial Bank

,

den nonferrous metals

be

,

$8.6 "

—

peak.

and

„
,

tal

hv

Some

record '

a

twa* ssfjs &

final

as

ih^US«trr^P^tnii
railroadsLand in th^t'lke
a™

additional

thrive

j

hinonc /n
changes in

Lw

commercial banks cannot survive

An

upward

? ift

tnn

F. Eberstadt-

Commer-^

1960

SilSSlttS ""

completed.

Kirn

twn
sharp

offered to quick
oversubscription at $5 per share.
The offering was made on an "allCorp.

electric

do not.

So, to sum up, the competition
has been getting
tough and is
Soing to get. tougher. The art of

ings

Faradyne Issue
On

pacitors

that

role

Netherlands Sells

this connection.

emphasizing the im¬

portant

the previous

Keezer

mntoq fThe
mates
for 1959 have been i educed
voiume

banking educa¬

cannot resist

M.

Wiffi

revised
are

planned for

Electric

!!!,ri!?
!Lni JhL

Noguera, Secretary ol the Treasury; Dana B. Scudder, Assistant
Vice-President, The First National City Bank; and Abncr Kalisch,

in the business of serving
equipment industry
with electronic components such
as
dielectric and electrolytic ca¬

Being part educator by trade, I

Dexter

of

n

in

.Jr., Executive Vice-President, Banco Popular de Puerto Rico.

bank earnings,

on

time has

the

pre¬

be

budgets

^

1956, "

and

preliminary figure that probably

are
at / a
marked
disadvantage
relative to most industries because

they do not

Vice-

mi

"";
V

:

billion compared with $7.9 billionr^
in 1959 and $8.2 billion in

Depart-

will

agent for the
Commonwealth. Photo shows left to right: Francis Bowen, Senior
Vice-President of the. Government Development BanR; Jose R.

if his

capital ratio is unnecessarily
tends to put pressure
his liquidity position to main¬

M.

.p.»d

4%)

9nd

spending next year.
companies report

amount

s'firss- r rr

the

'

•

transportation' '
shipping,
buses- and

cial

y,

V/2%

,ment

that

high. »this

e

Director

sided at the bond sale held in the New York office of the Govern-

the

remember

in

banking group headed by the First National City Bank of New
York
and including
Banco Popular de Puerto Rico was high
bidder Dec. 8 for an issue of $20,000,000 Commonwealth of Puerto
Rico Public Improvement bonds, bidding for a combination of 5%

bonds, due 1961-1980. Interest cost was 4.0432%.
'Jose R, Noguera, Secretary of the Treasury of Puerto Rico, pre¬

must

consideration,

v

■<

«, and
communications
industries plan an increase of 14%""*

ishing'

u. r

:

other

(airlines,
trucking)

lVtc-

President
A

liquidity, the problem

for

The

H i 11

-

Keezer,

matter

.

the

r a w

Dexter

•

with

As
here

,

To Grow

s

more

_

of

Company Fall

and"-supervisors

need

-

1960, while refining is up >,
marketing, up 7%.
/
Mining companies, on the aver- **;
age, also indicate a-decline in
expenditures next year. In this "

announc¬

Pub 1

which

attention to the realistic appraisal
of capital- adequacy.

and

Transportation, Communication

G

require further revi¬

may

in

9%

capital

of-

rules-of-'

and

4%

group, only iron ore companies'- •
plan to increase spending in I960. ";

step

pace

ing the results

j'A

area

>

spending.
In

especially if their earnings-

This

increase

con¬

to

its

up

confronted with more, difficult
capital problems than in; recent

traditional maxim's

w

market.

,

may

positions are squeezed.-

10%

estimated for 1959—as

business

be:

years,

a

—

American

capital and
By and large, -they Have
doing : a good job : in -this

reserves.

been

I960

^

careful

[to 'maintain adequate

plans to spend $37.3

now

billion for mew plants and
equip-

/

.

saying

[bankers will have to be

tapped from the

,

Bank Capital Problems

;

C
V

a

planned

&

expend!-^members

decline of

Co„
of

509

the

Olive Street,
York and

New

Midwest Stock Exchanges.

36

The Commercial

(2432)

Continued from page 16

1.95 times

duce

much capital to pro¬

as

given income stream in oil
exploration as in the rest of the
a

cause

ment

in

1952

its

..

report

said:

"Exploration

development

and

fully

costs for minerals should be

tax purposes be¬
of the direct incentive this

who represents the think¬

such

of

conclusions, and has de¬
entire paper to

almost his

voted

pointing out the

of such cal¬

error

in

opponent

the

old

added:

allowance

hearings

"The

diverts

an

depletion

economic

re-

??dlSes jiuio the domestic extrac¬
tive industries when in the inter¬
of

ests

costs,

conservation,

and

overall

reducing

economic

effi¬

ciency such resources might better
be employed in expanding over¬

production."

seas

We

costs

lions

of

could

Conclusive

Finds

go

on

and

but

on,

have agreement by the
depletion opponents.. They say the
law encourages too much
explo¬
ration and development of oil and
gas,
but the situation is even

Evidence

drilling
evidence is conclusive
principle
of
current
write-off is not only equitable, but
copper, lead, zinc, and even coal.
necessary and
in the public in¬ The subject is too complicated to
terest.
It
has
been
so
treated cover
briefly.' Let me ask what
under Internal
Revenue
regula¬ kind of an economy ^ what kind of
tions since the beginning of the a
country, we would have if we,
income
tax.
If
drilling
costs, deliberately arranged through tax
sometimes mistakenly referred to
laws for a great cut-back in these
as
a
double deduction, were dis¬ resource industries.
allowed, then oil and gas would
There is a difference between
costs,

the

the

the

-be

only

of

getting the

ground

would

it is,
industry

what

for

Oil
show

that

pletion

industry oil and the manufacturing indus¬
out-of-pocket cost tries and even mines and mineral
mineral out of the
deposits. It is the very nature of
not be recognized the business that there can be an
a production cost.
apparent over-supply of oil even
financial statistics
though the reserves may be less
resource

the

deductions

for

de¬

for

intangible costs
in the case of our basic do not cover the same
expendi¬
chemical, sulfur, and worse for tures.
The
depletion allowance
iron, for copper, for lead and zinc, was created to
recognize the cap¬
and

worse

'

coal.

and

J° a/oid ?his alleSed misallocawpvn
C1P-ltalTthey d0R,t clai™
were
making too much money,
ti

.lust spending too much—they pro¬
pose the reduction and final elimi¬
nation of

percentage depletion, to

ways6 US USG °Ur CapUal in other
This

their

was

These

basic

conclusions

of

argument.
the

oppo¬

ital

nature

the

of

income

from

extraction from the property, and
to

provide funds for the replace¬

ment

of the

value

in the

reserves

allowance

is

of

depleted oil

ground.

Since the

not

large enough to
accomplish even this purpose, it
could not possibly be applied to
the recovery of other expenditures.
Furthermore, the disallowance
of intangible costs for productive
wells

would mean that with taxes
just what the oil and
mining industries have been say¬ we would immediately be faced
with about double the present cash
ing for many years.
A reduction
outlay for drilling costs.
I can

nents

are

SndfP

in Wl11 mean less ex-

ploration,

less

higher

oil,

terest,

development,

less

prices.

thlS
affects
the public in¬
how
could
we
have

a

broader area of agreement? These

P°intS
that really couat.
arguments they develop

Anv
Any nfh
other

only

can

be

technical

in

think

of few

have

things which would
impact on the
The
simple
lack
of

a more

industry.
money,

sudden

well

as

the. cheerless

as

outlook, would drastically curtail
activity.
And

so

find

we

advocacy of

then

the

S
to

attack,

we

members

do not know. But

of

the

Committee

debate back
down
where the

!ilguby

o
caith

starting
last hearings left off

Rounding

out

this

Convinced
per-

Xfn§e
™ethod of now,
computing
de¬
pletion allowances
we would
bave to invent it."

of the

?s not
nnf1
is

hole

oquently
rather

is

re¬

history of percentage

indirect

or

subsidy, as has
charged
but
simplified and equi.

been

a

p-rmitmefth°d °f comPotation to
earning
to recover
from
earnings taxpayer
the amount
of capital
used up

when exhaustible natural

gi'oun^^Tf16 fextracted from the
fhP
cf'
pats aI1 Producers
of
the
mineral
terms
of
same

on

ST*
/y w^th reference to
deduction for
depletion."

the
will

J i?/r°re
dle Committee
Means, how can it be

on Ways
analyzed?

and

For

exploration

costs

we

el*ste ST61!' a?ong the
m-ttL

rnitted

as

capitali7Pr?

mav

Pan"

exploration costs percurrent deductions
a

J

balance must be

operating costs.
proper."

President's

developmental,

drilling

This

is

of

course,

tion.

Because

agree

that

duction
less

the

even

its

critics

elimination
less

means

or

re¬

exploration,

development, less oil, higher

prices, greater dependence on for¬
eign supply—all matters of great¬
to

concern

the

public—they

have

begun to approach the sub¬
ject with uncertainty.
Critics' Uncertainty
Some
and

suggest

a

graduated rate,

they have hoped

that

producers would be at¬
tracted to this proposal. But
there
is little attraction in
ber of

being a mem¬
sick industry, where our

a

only future is to remain small, or
to sell
out
our
properties.
Be¬
sides, this violates our sense of
fair

play, because taxes

only

on

people,

would

and

suffer

graduated rates

are

are

levied

the

firms

under

owned

by people with moderate
ment

and

whose

income

receipts,

dends,

already
double tax,
at

from

coming

such

an

operator




His

operating

expense

Relative
oil

to

demand,

domestic

have been remaining
show a decline. Can we

reserves

static

or

then

say

allocates

that

the

industry mis-

resources

to production?

^nd soother simple question.

When

an

operator

purchases a
P r o p e r t y, percentage depletion
seldom applies. His cost
depletion

provided

structure

arS

critics

the

Can

their

formula,

tell

which

us, with
claims all

To

create

who knows little

one

about

does

and

calculations?

such

the

Dare

These

results?

spend for finding tion rate is

developing replacements and

new

resources.

These costs—cash

expenditures—are running almost
three times the total depletion de¬
ductions permitted.
These costs

risk

we

major

are

a

much more sensitive

price alone. It
too complex a factor to be
pensated for by price alone.
is why I believe the long
effect on price would be
factor

than

is fai
com¬

That

range
mucn
estimates presented

of the gross price more than the
get for the oil. No other indus¬ to date.
There are no adequate studies
try has to spend such a large por¬
tion of its receipts for costs like on this subject.
If we take oui
critics seriously, they tell us mis¬
this.
When Congress fixed for per¬ allocation of our capital is almost
centage
depletion
the
uniform two to one. Would this mean we
amount to 60%

exceeds

that

allowed

under

the

,.

percentage formula.
Under
the
maximum figure of 50% of the net
theory, then, no misallocation of
from each property, this was
then,
capital results.
But if the same
and is now, a policy matter. Under
amount of money is spent in the
this policy all extractive industries
search
for
and
development of were
provided the same formula
new
production, creating jobs and Like
other long-term capital trans¬
adding to the resources which ul¬
actions, where 50% of the net is
timately serve all our people, then
(the other 50%
not
because percentage depletion is a recognized
recognized
may
be said to
be
factor, do our critics mean to tell
allowed )
here the instalment
us
that
the expenditure of
the
sale
and disposition of property
same amount of
money in this way
thiough
production
is
treated
similarly. And within the reason¬

capital?1" 3 misuse of the nation's

+u

?°P}ething
has
line of

gone wrong in
reasoning, this intel-

this

r
of

me

naveral
To

SC^lef'
and U reminds
situation at

the

novice

Cape Ca¬

on

send

a

crisp and clear night
to the moon
a

missile

a

might

take

bairel, place it

on

sight

the

up

target,

able limits of any simple formula,
this
depletion
recognition,
not

than 50% of net, makes an
effort to represent value depleted
more

for

down, and let fly.
That is the
simple and obvious way, like let¬

not

the

price

mechanism

take

everything. But that is the
way

miss

to

the

moon

com-

the

matters

not

ting

policy

and

moon

appears.

erfS*d1aims
reduced

or

eliminated

this

Al0^^ g falSG aim at the m°°nmatedif*rrying
taX levies esti"
at
minimum of $2.07 ner
mated

a

ban el, we could

only expect

over

in

activity in halt.

our

Cut purchases

in half?

half?
On the other hand,

if the

public

required the current rat
of activity, then to keep the tw
to one ratio in line with the
op¬
demand

ponents' theory, if they take
seriously, would
they ealculat
that price should be about doui
what

it

is

now?

ask that Con¬
the dep
tion rate,
refuse to change
"break-even point," refuse to
Certainly

all

us

we may

refuse to change

gress

into

the

unknown

fate in

are

the

facts.

are

questions, and should
as a political issue.

A Matter of
In

these

National

Security

hearings there

will be

empty chair—no panelist \<
vary,
they must represents
the
defense del a
vary, because of their individual ment, the national security,
characteristics, just as the per¬ haps this is because the members
centage of labor cost and material of the Ways and Means Comrnu
cost

no

cut

Cut jobs

an

industries

ive

ltakVnt0
account all factors,
and unseen, and a course is
sky where

substances

engineering. They

be treated

business

varies

by

product by prouct.

seen

a

various
of

The rates for the different extrac-

astronomers, have

charted out into

should

grinding wheels of the pu
~tai; ah the resources. But with¬ mechanism, without complete <.
in this policy
framework, the rates hard-headed analysis of all

count

oil,, and target. No, the
scientists, the
as
divi¬ puter men, the

a

price

we
_

of

represent

incentives

the

depletion resource
development involves a
powerful economic misallocation of
capital, just how
forces to cause liquidations
and
much capital will be lost to the
sell-outs, and eliminate and waste search for and
development of re¬
vital human resources for explo¬
sources
if the depletion law is
ration and development.
changed?
Can we depend upon

must

sure

receipts above current

A

reduction in percentage

would

and

simple questions?

one

selling his
installment

through

,

non-controversial.

is

which

two

ceeds in
completing a successful great additional revenues
are made
that
will flow
well, he immediately begins to into
the
Treasury
if
depletion
deplete his property by produc¬

basis.

that

cludes

unlikely to bring about enough
original discoverer and developer.
exploration and development to
A new owner, without any per¬
meet national needs of domestic
centage depletion, has less tax
production of scarce minerals.",
liability with his cost depletion,

theory as it has been presented,
I humbly suggest that we ask

may

care

suc¬

ade-,

properties are worth more in the
hands
of anyone
else than the

questions for Congress.
Whether we do it formally or
not, for each well and for each
project we calculate a probable
"break-even point," if you will
permit me to borrow a term from
propor-'
Based on net income from each the manufacturing industries. This
tion to the reserves it represents.
of the properties from which these "break-even
point" involves all
We do not say that we have too
resources
are
extracted, oil and the
variables
inherent
in the
much development in water re¬
of
gas is already allowed LESS de¬ chance
success,
costs, taxes,
sources
and dams,
just because
pletion than the average of the capital recovery, and many other
we could open the valves and let
other
resources.
Based
on
the factors. A change in depletion, a
all the water out of the reservoirs.
economic value depleted through reduction of almost one-half,
No, the vital thing is how much
have a major effect on
water there is to draw on, how production, oil is allowed LESS. would
Based on replacement cost, where every
decision regarding every
much in the developed reservbirs
properties are purchased to re¬ project and every well. Who can
And so with oil.
tell now what the reduction in
However, this subject of free place those exhausted, oil's deple¬
tion is inadequate.
And finally, exploration, development, second¬
play of the market in allocating
and of utmost importance to our ary recovery, production, would
resources is important.? It is one
national economy, oil's depletion be with
such
a
change in the
of the five guide lines set
up by
allowance is the lowest of any "break-even
point?"
There are
the Committee. But in
testing the
resource
reasons
to
believe
that the deple¬
compared with what it

mostly

finally

He is
engaged in
capital assets on an

Policy

than

tax

a

critics

are

tion.

Materials

Our

invest¬

subject to a
graduated rates,
without recognition of the
deple¬
tion they suffer.
When

less

or

others, rather than Because it is assumed that all
factors
will
remain
recognition of a special other
the
same, and they will not,
Recall
problem not faced by others.
the law of physics, "For
every
For any problem hard to under¬
action there is a reaction."
stand, the spirit of compromise is
The Materials Policy Commissuggested. So we hear proposals
sion appointed by a previous ad¬
to cut oil's depletion to 15%. The
ministration, recognized this fact
present rate is already a com¬
in its report, Resources for Free¬
promise. With the present formula
dom,
1952, with the following
Congress
has
taken
a
middle
words: "Because of the past er¬
ground between economic value
ratic price behavior of minerals
and historic cost, and the deple¬
and
the
long interval between
tion
recognized is substantially
initial investment and yield from
below
the
depletion
sustained.
production, the Commission con¬
This is why today almost all oil
not available to

'bperation of the extractive indus¬
point to ap¬
tries, oil's 27 ^ seems more than
or temporary over-supply,
and jump to the wrong conclu¬ sulfur, lead, zinc, with 23; copper,
iron and certain clay, 15; coal, 10.
sions. This difference occurs be¬
But the truth is, and the facts are,
cause of the physical nature of oil,
that it is not. This cannot he em¬
which is liquid, subject to being
phasized too much.
produced at rates out of

inde¬

pendent

desirable

quate.
parent

were

extremely

The

All

which

~

dle evidence which

i

(a)

f°WS
^Uite clearly
that
tax gimmick
or loop¬

n
a

tax-free against net income:

and

est

.And he adds: "This brief
it
at

as

a

Finally, about percentage deple¬

agreement
the eminent panelist from the
coal
industry Will say: "I am
that if we did not have the

view

off

than

responsible

no

change in the tax
or
involve
situations which are law regarding drilling. It is inter¬
not representative of the industry esting to note that on this
subject
-—marginal analysis as the econ¬ Senator Douglas of Illinois wrote
omists say.
a constituent,
"the oil industry is
°PP°nents will phrase permitted by our tax laws to write
nature

is

neutral, not equitable.
They advocate elimination of the
present provisions, and tell us that
everything would all somehow be
taken care of by price changes.
They claim oil misallocates re¬
sources,
but even greater misallocation exists for sulfur, iron,

intangible

where the cash

there you

treatment, and the use
of capital. Note the

allocation

or

word

bil¬

in

measured

are

neutral tax

dollars."

Regarding

that

culations.
Back

ment

regarding depletion and the

public interest, those who still ad¬
vocate a change have now directed
their criticism around a theory of

gives for capital to
economy.
The corresponding fig¬
take
risks
in
highly
uncertain
ure for sulfur is
2.12, for iron 2.13
for copper 1.96, for lead and zinc! fields. Such expending would be
likely to be particularly important
<2.27, and for coal 2.30."
But now in the new hearings for the petroleum industry whose
annual exploration and develop¬
one panelist, a
professor of eco¬
ing of many students of the subwill disagree with the extent

Thursday, December 10, 1959

•

arrangement

nomics

..

expendable for

Issue Today

Commission

percentage depletion proviprovide incentives to use

.

not "Our national policy, not
complex mixture of capital, capi¬ the. long run, and after we've
the
■>
tal gains, and ordinary operating killed the goose that lays the eggs, public interest!
There have been calculations
income. And with percentage de¬ lower and still lower tax revenues
oi
how much more it would cost
the
pletion, that is just the way they for all levels of government. ~ .
consumer if depletion is
are taxed.
reduced
Problem Not Faced by Others
or
eliminated.
It believe
these
calculations
Critics' New Agreement
There is a tendency to regard
greatly underestimate
the impact on the consumer.
With the broad area of agree¬ depletion only as a tax deduction
Why?

The Depletion
our

and Financial Chronicle

C(leplet
A

business
This is

a

Point in understanding
Lower Rate

Would Be

Inequitable
To

reduce

oil

to

15% would
single it out for the most inequit¬
able treatment,
and allow rela¬
tively less for the continued oper¬
ation of the

other

industry than for any
Certainly this is

resource.

tee know fully the

relationsh p

depletion laws to our abili >
produce oil and other raw i c
.

rials

in

time

of

nationaJ, ej

gency.
Our defense
have eloquently stated

author

repeat the high-lis.}
a similar hearing before th
Economic Committee four y
me

.

their l

tion in the past.
Let

.

,

.

Volume

The Commercial and Financial

Number 5906

190

continuing program of .some
differential tax- law or
otherwise, an order to haVe the
extractive industry in position to
meet the needs of the national
emergency
when it arose, you
should say then that it would be

Chronicle

(2433)

a

Hearing chamber was

old

The

the depletion

polled

He

quiet.

opponents by name. Each in turn
answered, "Yes."
Mr. Mills said: "I think we have
come
a
long way.
You gentle¬
men
will agree with that. The
four of you now from industry
will agree with that?"

include both

"

nodded
agreement.
There
unanimous agreement.
.

*From

an.

address by

nations
and

the

of

Inde¬

i'i \ L

to

cure

the

ward

for the quarter
Pres.

Eisenhower

in

absence

the

of

ills in their wake.

spent

in

many years

at
$62,312,000
acquired in July, 6,113
658,000 in August and

for $71,7,163 for
$85,360,000 in September for a to¬
tal of 18,590 mortgages valued at
$219,330,000 purchased under the
agency's Secondary Market Op¬
erations program during the quar¬
ter.

gations are not on the level of requirements of the
present stage of economic development. Weak
people, people with insufficient qualifications, must
be replaced by people with higher professional and
political qualifications. We cannot tolerate weak¬
ness and
easy-go-lucky ways in the realization of
party resolutions."—Artur Starewicz, Chief of the

and financial statement of the As¬

business.

He

comes

to

Paine, Webber
from the New
head¬

York

quarters office
Homer B. White

Eastman

of

Dillon,

Union

where he was in
charge of the dealers' relations
department, traveling extensively
l12

years

Dillon he

Davis,

before
was

the sales staff of

on

At

Co.,

time

one

ciated with the old

Company

in

New York.

San

San Fran¬

he

was

An

asso¬

mess.

all-wise

of

of

$2 per share. The
marks the first public

the

company's

common

stock.

proceeds

plied by the

from

shares

common

purchase of

sale of
250,000 shares of Pan-Alaska stock
now
owned by Marine Drilling,
Inc. will be retained by Marine.
The

proceeds

the

of

the

company

of

sale
be

ap¬

stock of Re¬

common

from

sales, after reimbursing Marine for
expenses of this offering estimated
toward the at $35,000, will be paid to Pan-

will

Alaska

for

the

search

Associates, Inc., a statistical options and
Publishing firm and publishers of capital.
"The

Florida

as

exercise
a

market

'

studies

services

individual

and

and

for

various

corporate,

governmental

clients.

Alaska after July 31,
oil

and

gas

1959,

on

the

leases presently held

1959

the

$640 for 1959, $34,400 for
and $7,520 for 1961. PanAlaska may wish to drop a portion
or
all of its leases at any time

company

Sept.
had total

terminate

obli¬

billings of $223,309 and net income

and

of

gation for the payment of delay

$13,772.

Upon

completion

of

the current financing, outstanding

capitalization of the company will
consist of 234,575 shares of com¬
mon

stock

and

$8,184 of 3%

bentures.
Other members
group

that

times

as

much

as

last year when
1,879 valued at $21,365,000 were
bought. The ratio of FHA mort¬
gages to GI mortgages acquired
during
the
quarter was
more
than
three
to
one
with
14,544.
FHA-insured liens worth $168,-

include:

of

the

Pierce,

de¬

thereby

*

rentals.
Pan-Alaska

any

is

presently

nego¬

tiating to acquire a participation
in
a
drilling unit covering ap¬

proximately 100,000 acres in the
offering Nulato Unit Area approximately
Carrison, 20 to 50 miles south of Pan-Alas¬

Wulbern, Inc., Tampa, Fla.; Aetna
Securities Corp., New York and

ka's acreage blocks,

Miami

that, if funds from this offering
are available, Pan-Alaska intends

Beach; Nolting, Nichol
O'Donnell Inc., Pensacola, Fla.




&

approximately $69,000
acquire approximately 3V2%
in the Nulato Unit, the

drilling well (and any production
therefrom) and related physical
Information

assets.

gained

from

this participation

The

Pan-Alaska

officials

are

not

committed,

but

it is Pan-Alaska's intention to use
the funds

for

operating

expenses

developing
leases in the State of

and for acquiring and
oil

and gas

Alaska.

»

and 4,046 VA-guaranteed
valued at $51,000,000
added to the corporation's rapidly
expanding portfolio. Since the in¬
ception of the Secondary Market
Operations program in November
the

1954

Association

has

pur¬

with
principal amounts involved total¬
chased

209,280

mortgages

•

practically every state with the
exception of the New England
States where mortgage funds are

in

relatively
adequate.
during
the
quarter

Purchases
related
to

properties located in 42 states, the
District

of

Columbia

and

Puerto

paid.
Sep¬

share.

a

The report also brings out that
while purchases and offerings in¬

creased, sales of mortgages to pri¬
vate investors amounted to only
$564,000 in the quarter.
Portfolio liquidation other than
sales during the quarter totaled
$15.9 million, chiefly in the form
of principal repayments and pre¬
payments. At the end of the quar¬

ter, the portfolio of the Secondary
Operations consisted of
163,740 FHA and VA mortgages
with unpaid principal balances of
$1,776,600,000.
FNMA's net earnings under its
Secondary Market Operations
during the quarter amounted to
$2,368,612 after expenses, and af¬

Market

establishment

ter the
for

losses

of

of

$109,665

reserves

provi¬
payment to the United
States Treasury of $2,554,538 as
the equivalent of Federal income
taxes. Earnings during the quar¬
ter
amounted
to $1.70 on each
and

sion for the

share of

common

stock and

$1.73

each share of utilized preferred
stock.
From these earnings, pro¬
on

vision

for payment of
Secretary of the
Treasury as the full amount of
cumulative dividends on preferred
stock and of $292,581 for payment
of dividends on
common
stock,
leaving $1,414,781 for transfer to
general surplus.
was

$661,250

made

to

the

Association

The

A

Experienced Assoc.

that

(Special to The Financial Chronicle)

Form

In

maintains

re¬

Ball, Pablo Co.
Washington, D. C.

WASHINGTON, D. C.—Ball, Pablu
& Co. has been formed with offi

highlight of the report shows
all major segments of the
finance industry are par¬

home

FT.

LAUDERDALE, Fla.—Expe¬ ticipating in the FNMA program.
Inc. are en¬ A breakdown of the 592 sellers
gaging in a securities business that sold mortgages to the Asso¬

Connecticut

1000

at

ces

N.

W., to engage

business.

Rico.

Officers

in

Avenue.

securitie

a

are

Frank

F.

Ball, President and Marcelino T.
Pablo, Executive Vice-President
Both were
formerly officers c
Weil & Company.

rienced. Associates,
from

offices

here.

Officers

are

during the quarter shows
P. M. Baker, President; William that
454
mortgage
companies
K.
Hall, Vice-President;
P.
J. (77%) led the list, followed by 95
Wedel, Secretary, and M. N. Jud- banks and trust companies (16%),
34 savings and loan associations
son, Treasurer.
(6%), and 9 insurance companies
(1%).

Bankers Bond Co. Adds

Jr. has become associated with

The Bankers Bond Company, Inc.,

Kentucky Home Life Building. He

formerly an officer of the
Exchange Bank of Mayfield, Ken¬
tucky.

was

Oscar Coolican

Opens

WASHINGTON,
D.
C. — Oscar
Coolican is conducting a securities
from

offices

Avenue. He was
with Hirsch
& Co.

Wyoming
merly

at

Francis I. du Pont & Co.

(Special to The Financial Chronicle)

ATLAiVi A, Georgia. — George M
Brown III has become connecter

with

J.

Hilsman

H.

&

Co.,

Inc

Citizens & Southern Building. He

with

formerly

was

the

Georgia

Savings Bank & Trust Company

Reflecting the stepned-un buy¬

(Special to The Financial Chronicle)

ner

Joins J. H. Hilsman

ciation

ing tempo, approximately $4,582,LOUISVILLE, Ky. —Bunk Gard¬ 000 in FNMA common stock was

business

indicate

of funds from the

balance

offering

total

1960,

For the nine months ended

30,

showed

the third quarter

interest

stock

of

Business
Letter";
The proceeds received by Panopening of additional of¬ Alaska will be used for the pay¬
fices; for the purchase of modern ment of
delay rentals, the acquisi¬
electronic equipment, and for gen¬
tion
of
additional
oil and
gas
eral
working capital.
leases, the development of such
First Research Corp., incorpo¬ leases and leases presently held,
rated in 1950, performs on a fee and for
operating expenses. Delay
or
subscription basis economic repeals to come due by-Panresearch

in

invest

and

contribution to

for the

and

than ten

be
and

will assist Pangional agency offices in Philadel¬
ing $2,385,461,000.
Alaska in evaluating its acreage
phia, Atlanta, Chicago, Dallas and
Los Angeles, and a
sales office
offered on Dec. 7, 2,408,521 shares and in determining the course of All States But New England States
and fiscal agency office in New
exploration.
Pan-Alaska
of the 10c par common stock of future
The report also disclosed that
York
has
not
entered
City.
any firm contract the FNMA
Pan-Alaska Corp. at a price of
Secondary Market Op¬
to acquire an interest in this unit.
20c per share.
erations is currently being utilized

The balance of the proceeds

Net

the

also

300,000

Clark, Landstreet & Kirkpatrick,
Inc., located in the Life & Casu¬
alty Tower in Nashville, Tenn.,

First Research Corp. common stock

offering

report

quarter purchases were 72%
higher than the preceding quar¬
ter's 10,704 for $127,187,000 and

mortgages

Roman & Johnson, Fort Lauder¬
dale, Fla., is manager of an under¬
writing group which is offering
today (Dec. 10) 100,000 shares of

sale

The

and

Research Issue

J

released this weekend by
president J. Stanley

third

"

price

report

Baughman.

National City

Francisco

to

a

are

a

FNMA

party has bungled.

Roman & Johnson Pan-Alaska Corp.
Stock Offered
Offers First

at

ter,

Natural
forces, the normal regulator of business under capi¬
talism are, of course, not permitted to function.
Maybe Karl Marx was wrong, after all!

joining Eastman

Skaggs &

cisco.

From all accounts Polish economic affairs
a

in

erations, covering the third quar¬

more

For

revealed

was

sociation's Secondary Market Op¬

Polish Communist Press Bureau.

Securities & Co.,

in the East and Middle West.

This

cents

23

were

to

August

Sales Drop to $564,000
J. Stanley Baughman

"It was proved that our methods of planning,
leadership, economic analysis and scientific investi¬

securities

the

for

June.

mort¬
gages
valued

A Communist Mess

White

Mr.

with

dividend

Dividends

5,314

announced.
has

in

each

month

not only all but certain to

fail but could well bring further

Nicoud, Jr. has

successive

increases

Resident

tive,

further

ha sized

emp

by

situation

are

of

The up¬
trend

buying

Efforts to

Manager Louis

since

fourth

1957.

problem is,'of
create "the "right

"right conditions"

Paine, Webber,
Jackson & Curtis, 369 Pine Street,
as a registered
representa¬

lowest

quarter

conditions."

of

office

the

was

real

course,

SAN FRANCISCO, Calif.—Homer
B. White has joined the San Fran¬

Although
purchases increased
substantially, the rise in offerings
received during the quarter was
even
more
marked.
The 28,637
offerings valued at approximately
$350,000,000 were considerably
higher than the previous quarter
when 16,955 worth approximately
$200,000,000 were received. It was
also pointed out by Mr. Baugh¬
man that the number of
offerings
climbed steadily month after
month with 7,885 received in July,
9,307 in August, and 11,445 in Sep¬
tember, compared with 6,435 in

the

intelligent trade relations

The

Paine, Webber Co.

tember

third

to

hower.

Homer White Joins

monthly

Association

volume

capital

the

found to have used FNMA

are

Reflecting the tight money mar¬
ket, Federal National Mortgage
purchases during the
quarter continued to swing
upward while
sales
dropped

honorable and

needing

England

'

Secondary Market Operations during this period.

all free nations."—
President
Dwight D. Eisen¬

■ -

.

cisco

All states except those in New

among

pendent Petroleum Association of Amer¬
ica, Dallas, Texas.
■

National Mortgage Association report shows
purchases amounted to $219,330,000, offerings came to $350 million;
and sales dropped to $564,000—the lowest since 1957's fourth
quarter.

responsible attitude within the

was

Mr. Stanley be¬

Meeting

Annual

the

fore

Third quarter Federal

witnesses

four

other

The

an

Purchases,

While Its Sales Take Drop

"Foreign capital helped our own country make
spectacular progress during the first three quarters
of the 19th century—capital which over a 40-year
period we repaid with interest. So, too, can private
and public capital, under the
right conditions, now assist the
less-developed nations make
sound
progress toward the
achievement
of
their
goals.
Those 'right conditions' must

continuing program?"

a

FNMA Increases

"Right Conditions"

sort,- a

37

Now W'th L. F. Rothschilc.
(Special to The Financial Chronicle)

subscribed for

during the quarter.
(Fellers of mortgages to D'NMA
under the Secondary Market Op¬
erations are required to buy stock
in an amount equal to 2% of the
principal amounts involved.)
Broadening the base of private
ownership of the corporation con¬
tinued
during the quarter with
5,381 stockholders holding 457,126
shares of FNMA common stock on

Sept. 30. Dividends continued to
for¬ be paid monthly. The dividend for
and July amounting to 20 cents per

2139

share,

was

the

43rd

consecutive
I

CHI

O,

ii

Rothschild
Salle

.-

-nobert G. Wals
with L. F

affiliated

become

has

&

Street.

Co.,

231

South La

Mr. Walsh was for¬

merly with McDougal & Condon

Inc., and First of Michigan Corp.

Elected Director
Vice-ChairmaCity Ban"
of
New York
has been electee
a Director of The Mead Corpora
Alan
of

H.

The

Temple,

First National

tion.
,4r

38

(2434)

The Commercial and Financial Chronicle

.

Thursday, December 10, 1959

.

.

* I N DICATES

Securities

Now

Abbott-Warner Co., Inc.
'
Aug. 12 (letter of notification) 62;500 shares of common
stock
(no par).
Price—$2.70 per share.- Proceeds—To
estimates

and to submit bids, as prime con¬
specialized construction projects. Officer—123
Avenue, Youngstown, Ohio.
Underwriter —

prepare
tractor

on

Denick

.

Strathmore

Securities, Inc., 605 Park Building, Pitts*
burgh 22, Pa. This offering is expected to be refiled., ",v
^-Admiral Plastics Corp.
Dec.

4

filed

160,000

in
of

3

shares of

($9).

had scheduled

American
of

stock

common

:

Life

Insurance

REVISED

...

Manufacturing Co., Columbus,
(12/15)-V,

12

cv,

pfe
!"

a

Ohiio

370,000 shares of .common
stock
-of which 70,000 shares are
to be offered for

/

«iV

(n»r

the

of the

--v

filed

accou-i

company; and 300,000 shares will
be sold

issuing

10

(par

one

Price—$100 per share
wcrkihg capital. Office—131 S.
Wabn?v»
Chicago 3, 111.
Underwriter—None. * • /k >
ckn

Nov.

Co.

ISSUE

ceeds—For

f.

a

Service

ITEMS

Be.den

on Sept. 2, which will
stop-order will be issued suspend¬
No decision has been announced.

ing the offering.

PREVIOUS

.for

hearing, to begin

a

determine whether

AD DITION S

SINCE

holders of reqord Dec. 10, 1959 on- the
basis of
each 6Vz shares held.

common
($1 each) and 1 share of pre¬
Price—$12 per unit.
Proceeds—For con¬
struction and related expenditures.
Office—513 Inter¬
national Trade Mart, New
Orleans, La.
UnderwriterLindsay Securities Corp., New Orleans, La. The SEC

ferred

*

shares

•

cents),

of which 150,000 shares are to be publicly of¬
Price—To be supplied by amendment.
Proo&ds—
For general
corporate purposes. Office—446 12th Street,
Brooklyn, N. Y. Underwriters—Filor, Bullard & Smyth

fered.

and

Hardy & Co., both of New York City, who are en¬
titled to purchase for $500
five-year options to acquire
for 75 cents per share the
10,000 shares not accounted for
above. Offering-—Expected in
January.
Aircraft

Dynamics International Corp. (1/15)
(letter of notification) 100,000 shares of com¬

Sept. 25
mon

stockpar 10 cents). Price—$3 per share. Proceeds
*2lFor general corporate
purposes.
Office—229 S. State
Street, Dover, Del. Underwriter—Aviation investors of
America, Inc., 666 Fifth Avenue, New York 19, N. Y.
Alaska

Consolidated Oil Co., Inc.
Sept. 17 filed 3,000,000 shares of common stock (par
five cents). Price—$2.50
per share.
Proceeds—For fur¬
ther development and exploration of the oil
and gas po¬
tential
Wall

of

the

company's

Co., New York.
four

Offering—-Expected in about three

to

weeks.

Alberta
Nov.
due

Alaska properties. Office—80
Underwriter—C. B. Whitaker

Street, New York.

Municipal Financing Corp. (12/11)
$20,000,000 of sinking fund debentures,

25

filed

Dec.

15,

1984,

The

debentures

are

guaranteed

un¬

conditionally as to principal and interest by the Province
of Alberta. They are
payable in the United States cur¬
rency. The debentures will not be
redeemable, except by
operation of the sinking fund, until Dec.
15, 1969. Price
be supplied
by amendment. Proceeds—From the

r—To

sale

of

the

debentures

after

conversion

into

Canadian

funds, will be applied to the purchase of securities of
municipalities, cities,, towns and villages within Alberta
as
loan applications are
approved.
Underwriters—The
First Boston Corp. and
Wood, Gundy & Co., Inc., both of
New York.

Allied Producers
Corp.
Dec. 3 filed 1,000,000 shares of
common stock.
per share.

Price—$1

Proceeds—For working capital to be used in
the purchase of oil and
gas properties and related forms
of investment. Office—115 Louisiana
Street, Little Rocik,
Ark. Underwriter—The
offering is to be made by John
JL. Hedde, President of the issuing
company and owner
of 10,000 of its 80,000

presently outstanding shares.
Mr.
a."best efforts" basis, and will re¬
.

Hedde will work
ceive

selling

a

Arkansas

on

commission

sales

and

15

of

cents

12

per

cents

share

per
on

share

on

out-of-state

sales.
*

Allied Small

.,

.

used

Office—Washington,

D.

C.

Underwriter—To

•

American Frontier Life Insurance Co.
Nov. 30 filed 200,000 shares
of-capital stock. Price—$8
per share.
Proceeds
To increase
capital and surplus.
Office—1455 Union Ave.,
Memphis, Tenn. Underwriter—
Union Securities Investment
Co., also of Memphis, which
Will receive a
selling commi.msm.sion of $1.20 per share.
—

^ American Gypsum Co.
Dec. 4 filed 518,050 shares of
000 of 7% first
mortgage

shares

of

of

common

stock and

$1,200,notes, to be offered in units
principal amount of notes and 40
Price—$300 per unit.
Proceeds—For

$100

stock.

general corporate purposes, including construction
equip¬
ment, and working capital.
Office—323 Third
S.

W.,

Albuquerque,

N.

Street,
Underwriters—Jack M.

Mex.

jkass & Co., Nashville, Tenn.,

and

querque.

Quinn & Co., Albu¬

Dec. 2 filed 1,000,000 shares of
capital stock. Proceeds—
For investment.
Office—6505 Wilshire
Boulevard, Los

Angeles, Calif.
American
25

Investors Syndicate, Inc.
600,000 shares of common stock

filed

redeem

THE STOCK ANSWER
the question of how to in¬
your sale of stocks? It may well he the
more than
answer to

1,400,000 stockowners
stocks alone
on

they hold

how you can sell

America, talk

to

a

in

Chicago and Mid

more

more

America. In
than $20 billion. For details

securities in

Chicago and Mid

Tribune representative,

(Hip rag o Qtibnro
THE

WORLDS




dividends

of

on

cumulative

the
pre¬

10

GREATEST

NEWSPAPER

leading

a

subcontractor it serves the major
missile,
aircraft companies through its missile
con¬
tainer division. Underwriter—S.
D. Fuller &
Co., New
York.
Offering—Expected in the early part of
January,

rocket

general corpor¬

ate

r

purposes,

including additional working capital. Office
Causeway St., Boston, Mass. Underwriter—Putnam
Co., Hartford, Conn.

&

and

1960.

'

Oct.

12

filed

offered

offered

to

the

public.'

Price—$1 per share. Prcceedsdealerships, increase inventories, and
*
advertising and. Increase working

expansion and general
corporate purposes. .Underwriter
—Ross, Lyon & Co., Inc., New
York, N. Y.

To

provide

funds

Anthony Powercraft
Sept. 8 (letter of
notification).

capital.

Office—10232

mulative

convertible

preferred

stock :to

subscription by

5%
be offered

inventory,

capital.

tools, construction

Office—5871

Gate, Calif.

E.

Firestone

Underwriter—None.

and for

for

Apache Properties, Inc.
20 filed
500,000 shares of common stock
(par $1)
to be offered in
exchange for undivided interests in
gas
and oil leaseholds
located in certain
in

Okla¬

homa.Price^—$10 per share. Office—523
Marquette Ave.,
Minneapolis, Minn. Underwriter-—None.

com¬

stock (par 10
cents). Price—$3 per share. Proceeds
general corporate
purposes.
Office —8806 Van
Wyck Expressway, Richmond
Hill, N. Y. Underwriter—
A. D. Gilhart &
Co., Inc., New York, N. Y.
Offering—For

Expected in December.

common

supplied
in

stock.

Price-

by amendment.

common

Proceeds—For invest¬
Office—301 W.- 11th Street

stocks.

Kansas City, Mo.
Underwriter—Jones Plans, Inc.,
sidiary of R. B. Jones &
Sons, Inc.

a

sub-

Australian Grazing &
Pastoral Co., Ltd.
13 filed
4,000,000 shares of common stock.
Price—
At par (5614- cents
per share).
Proceeds—To purchase
cattle; for
improvements; to buy additional ranch ir
Jan.

Office

1301

and for other corporate
purposes
Underwriter

Avenue L, Cisco, Texas.
None. Robert Kamon
is President.
B. M. Harrison
Electrosonics,
Inc.
Sept. 25 filed 133,000 shares
of

common

per

share.

Proceeds—For

purposes, including the reduction

of

—

stock

general

(no par)
corporate

indebtedness

and
the provision of
funds to assist the
company's expansion
the civilian

into

market.

Office

Newton Highlands
Parks & Co.,
Inc., 52

—

Underwriter—G. Everett
York

City.

notification) 300,000 shares

of common

(par 25 cents).
Price—$1 per share. Proceedsworking capital. Office—1404 Main
Street, Houston
2, Texas.
Underwriter—Daggett
Securities, Inc., Newark
N. J.
Offering—Expected in about 30 days.
Bankers Preferred Life
Insurance Co.
Jan. 30 (letter of
notification) 100,000 shares of common
stock
(par $1.60). Price—$3
per share
Proceeds—Fov
expenses incidental to
operation of an insurance com
pany.

Office—Suite 619, E.

&

C.

Bldg., Denver,

Underwriter—Ringsby Underwriters,
Bear

Nov.
stock

10

Brand

to

holders

one

Hosiery

of

the

of common stock to be offered

outstanding

share for each

new

~

the

common, on

eight shares held.

Inc..

pected in January.

i

.

.,

Border Steel
Rolling Mills,
Sept. 14 filed $2,100,000 of
shares
units

of
of

shares

common

Inc,

.

subordinated

6%

$50

of

principal,

common

amendment.

construction
of

'

Co.

(letter of
notification) 2,000 shares of common
(no par) to be offered
for subscription
by stock-

1, 1974, and 210,000
($2.50 par), to be offered in

stock

amount

stock.

necessary

of. debentures

Price

Proceeds—For

thereon, and

the

for

To

be

purchase

the

five

and

supplied by
of land and

manufacture and in¬

equipment.

Office—1609

Texas

Street, El Paso, Texas. Underwriters—First Southwest
Co., Dallas,. Texas, and Harold S. Stewart
& Co., El Paso,

Texas.

Border

Steel

Roliing Mills,

Sept. 14 filed 226,380 shares of
fered for

Inc.

common

stock, to he of¬

subscription

to stockholders of record Aug. 31,
1959, on the basis of 49 new shares for each share then
held. Price—To be
supplied by amendments ProceedsFor general
corporate purposes.
Office —1609 Texas

Street, El Paso, Texas.

Underwriter—None.

Bowmar

Instrument Corp. (12/14)
Nov. 10 filed
78,000 shares of common stock (no par),
of which 45,000 shares
will be offered for the company s
account and 33,000 shares
will be offered for the account
of several
selling stockholders.- Price1—To be supply
by amendment. Proceeds—For
working capital. Office

—8000

Bluffton Road, Ft.
Wayne, Ind. UnderwriterPaine, Webber, Jackson & Curtis, New York,
y

* Briel

ceeds—

Industries, Inc.
notification) 75,000 shares of class A
stock.
Price^—At par ($2.50 pel' share). Pro¬
To purchase
equipment, with the balance for
(letter of

working capital.
Office—2232 E.
Albany, Ind. Underwriter—None.
Burch Oil Co.

Market

New

Street.

.
.

Sept. 25 (letter of
notification) 120,000 shares of class a
common stock
(par five cents). Price—$2.50 per share.
Proceeds—For building and
equipping stations and true*
stop and additional working capital. Office—C/o Ga*
land D. Burch, at 707
Grattan Road, Martinsville, va.

Underwriter—Maryland

Co1

Denver

basis of

Price—/To.be

Montgomery Street, San Fran¬
cisco, Calif.. Underwriters—Wertheim- & Co.. New York
City, and J. Barth & Co.. San Francisco." Offering—Ex¬

common

For

Colo

Ave., Chicago, 111.

'

1

Booth Leasing
Corp.
Dec. 2 filed 40,296 shares

Nov. 23

Bankers Management
Corp.
Sept. 10 (letter of
stock

<

stallation

Associations Investment Fund
Aug. 28 filed 400,000 shares of
be

Kedzie

sinking fund debentures, due Oct.
100,000 shares of

mon

ment

South

15-year

Arkay International, Inc.
18 (letter of
notification)

Nov.

To

for

supplied by amendment.- Proceeds—For
general corpo¬
rate
purposes, including, the acquisition • of additional
equipment which the company intends to lease to various
businesses. Office—315

working
South

Boulevard,

counties

new

Underwriter—None.

pur-*

new

establish

cu¬

common stockholders at the rate
of two\
preferred shares for each three
shares of common stock
held.
Price—At par ($1 per
share). Proceeds—To

chase

•'

400,000 shares of common stock, to be
initially to independent dealers who handle the
company's products) with the unsubscribed shares tobe

•

of

:

B'anch-Ette, Inc.

Anodyne, Inc., Bayside, L. I., N. Y.
Sept. 9 (letter of notification)
150,000 shares of common
stock (par one
cent). Price—$2 per share. Proceeds—For

241,200 shares

'

.

—150

Broadway, New

crease

accuirrfilated

mately $800,000 will be used for
machinery and equip¬
ment; and the balance will be used for

Mass.

an

pay

stock; approximately $143,000 will be used to
pay
promissory note to Anderson-Nichols & Co.; approxi¬

a

Price—$3
(par

cents), and 200,000 shares of 6% preferred stock
(no par
value, $9 stated value), to be offered in units
consisting

Looking for

and

outstanding 2,000 shares

ferred

Queensland, Australia;

^ American Industries Fund, Inc.

June

to

company's

be supplied by amendment.

consisting

Price—To be supplied
by amendment.
.Proceeds—for
additional manufacturing
equipment, acquisition of prop¬
erty and retirement; of a $500,000 bank
loan. BusinessIn
addition to its aluminum
operations the
company
fabricates magnesium, stainless steel
and-titanium. 'As

stock.
Price—To.be supplied by amendment.
Proceeds—To pay off $400,000 of serial notes
plus ac¬
crued interest
thereon; approximately $220,000 will be
common

Nov.

Business

Investment Corp.
Sept. 29 filed 100,000 shares of common stock
(par $8).
Price—$11 per share. Proceeds—To be used to
provide
equity capital and long-term loans to small business
concerns.

larly engaged companies. Office — 113 Northeast
east 23rd
23rd: ,; Smith, Barney &
Coi", New v Yorky
Kirkpat'rick-Pettis Co"
Street, Oklahoma City, Okla. Underwriter
First InOmaha, Neb.^ and The First Trust Co. of
vestment Planning Co.,
Lincoln, Neb' '
Washington, D. C.
Bell
Telephone Co. of Pennsylvania
American Yachting Systems, Inc.
(12/15)
Nov. 20 filed
$30,()00;000 of 35-year debentures
Oct. 30 (letter of
dated
notification) .100,000. shares of common
Dec. 1, 1959 and due Dec.
1, 1994.'Proceeds—To
stock (par 10
cents). Price-:—$3 per share. Proceeds—
repay
outstanding advances from the: American
For general corporate *
purposes.
Office—Roslyn, N. Y.
Telegraph Gov?-any balance will be used Telephone!
for
Underwriter-^-Hilton Securities Inc., formerly
general
Chauncey,
corporate purposes,, Underwriter-^-To be
Walden, Harris & Freed, Inc
determined bv
,580 Fifth Avenue, New d competitive
biddirig. Probable bidders:
York, N. Y. Offering—Expected
Halsey,
ed any,day.:OV* >ih*nnm
Stuart
&
Co.- Inc.-; The First Boston
Corp.; White, Weld & Co
k
Anelex Corp.
and Eastman
(12/14-18)
Dillon,
Union
Securities & Co.
Nov. 18 filed
(jointly)*
$2,250,000 of subordinated, debentures, due
Morgan, Stanley & Co. Bids—To be
received up to il
Dec. 1, 1974, with warrants
attached to purchase 45,000
a.m. (EST)- on Dec. 15 at
Room 1900, 195
shares of common stock
Broadway. Nfew
(par $1) and (2) 90,000 shares
York, N. Y.
-■
•
" ■ V,':.: <
•;
•
of common stock
;(..
(par $1).
The debentures and stock
Benson
are
to be offered in units
Manufacturing
Co.,
Kansas
consisting of $50. principal
City, Mo. 1
Nov.
25
filed
amount of debentures
$2,000)000 of 6% "convertible
(with attached warrant to pur¬
subordinated
debentures due 1971 and
chase one share of common
130,000 shares of common
stock) and two shares of
stork.

Bank

Securities

Cadre

Corp.
17,532 shares of

■to

to

one

Old

Tew

Industries

Sept. 25 filed
be

Co., Inc.,

Building, Baltimore 2, Md.

offered

new

holders

share for

each

of
8

.

common

such

shares

stock

held.

stock
on

the

(Par.
basis

Price—$6-+

if

Volume 190

Number 5906

.

.

.

The Commercial and Financial Chronicle

of

Proceeds—For general corporate purposes, includ¬
working capital. Office—20 Valley St., Endwell,
\r. Underwriter—None.

Chattanooga, Tenn. Office — 2417 North Davidson
St., Charlotte, N. C. Underwriter—R. S. Dickson & Co.
Charlotte, N. C.

share.
ing
N,

Citadel

California. Metals Corp.
jixly 27
At par
of

a

Nov.

filed ?,500,000 shares of common stock.- Price—
(20 cents per share). Proceeds—For construction

pilot plant; for measuring orefor assaying; and for

Co., Ipc.,

Underwriter—Cromer Brokerage

City, Utah.

Salt Lake. City.

California Mutual Co-Ply,. Inc.

/ Citizens
Nov.

—At par

(par $2)'.

Price
($5,000 per share). Proceeds—To purchase the
mill and related facilities of Durable Plywood Co. for
Office—Calp£lla, Calif, t Underwriter—The offering
made by Ramond Benjamin Robbins, one of the
nine promoters, the list of which also includes Harrj
Ernest Holt, of Eureka, Calif., President of the company

is to be

(12/21);

Co.

M.

/

& Co.,- Inc.,

Dain

v:-

'Vv'v

.

Minne-

securities

' ./

standby) at the rate of $109 of
debentures, with an attached wai'rant to purchase 10
common
(shares for cash for each 100 common shares
held. Price
To be supplied by amendment. Proceeds
—For
general corporate purposes, including working
capital and the acquisition of sharps of the outstand¬
ing common stock of Davenport Hosiery Mills, Inc.,
(with

14

a

day

—

Office—Sac¬

shares,

v/'

*

stockholders

by

each

22

the

on

shares

held

basis

(with

of
an

one

over¬

subscription privilege). Price—At-the-market. Proceeds

$300,000, which will be used for work¬
ing capital. Office—408 Junipero St., San Gabriel, Calif.
Underwriter—None.

a

"best efforts"

basis.

90,000 shares of

Proceeds—To

Oil

RcImkmk

uo»

%.

Dec.

16, 1957 filed $25,000,000 of first mortgage bonds due
Sept. 1, 1968, $20,000,000 of subordinated debentures due,
Oct. 1, 1968 and 3,000,000 shares of common stock to be
offered in units as follows: $1,000 of bonds and 48 shares
of stock ahd $100 of debentures and nine shares of stock.
Price—To be supplied by amendment.
Proceeds — To

oonstruct refinery. Underwriter—Lehman
York. Offering—Indefinite.
1

Brothers/New

Commercial Metals Co.
Nov. 25 filed 100,000 shares of outstanding common stock
,j(par $5). Price—To be supplied by amendment. Pro¬
ceeds—To selling stockholders
Office—512 South Akard

St., Dallas, Tex. Underwriter—Eppler, Guerin & Turner,
Inc. Offering—Expected in the first
couple of weeks in
January.

• Community Public Service Co.
Nov. 20 (letter of notification) 12,060 shares of common
stock (par $10), to be offered to employees under The
Thrift Plan for Employees.
Price—At market price on
the American Stock Exchange.
Proceeds—To purchase
stock.
Office—408 W. Seventh Street, Fort Worth 2,
Underwriter—None.

Texas.

★ Coastal Chemical Corp.
Dec. 7 filed 111,729

shares of class A

common

and 70,000

shares of class C common, of which 50,000 class C
are to be offered for the account of Miss. Chemical

shares
Corp.,
selling stockholder, with the remainder of the offering
to be sold for the account of the

—For

the

stock:

issuing company.

Price

class A stock;

$25

$30 per share; for the class C
share.
Proceeds—For working capital,
and repayment of loans.
Office—Yazoo

per

construction,
*

Sept. 28 filed $2,000,000 of 6% conv. subord. debentures,
due Oct. 1, 1974, with warrants to purchase 200,000 shares
of common stock (par $i), being offered for subscription
by holders of its common stock of record Dec. 1,

fund

for

share.

Common*
.

on

common stock.
Price—$6.50
selling stockholders. Office—
505 Court St.,
Brooklyn, N. Y.
Underwriter — Marron,
Edens, Sloss & Co. Offering—Expected in January.
* "

Pro¬

—Not to exceed

.

Chadbourn Gotham, Inc.

for

share

new

Illinois Light Co.
; "•
Nov. 25 (letter of notification) 9,561 shares of common
stock (no par) to be offered to employees under the
Employees Common Stock Purchase Plan.
Price — At
90% of the average closing price on the New York Stock
Exchange oil five days preceding the purchase date but
not less than, 90% of the last sale on the purchase date
or the
last preceding day on which the stock will be
offered to the employees.
Proceeds—For construction,
improvement or extension of its facilities. Office—300
Liberty Street, Peoria, 111. Underwriter—None.
.

stockJ.

in

100,000 shares of capital stock.

subscription

,

1959

Nov. 30 filed

(12/14-18)
common

supplied by amendment.

-

Commerce Drug Co.

'

Clary Corp.
Nov. 13 (letter of notification) an undetermined number
of shares of common stock (par $1) to be offered for

general corporate purposes. Office—River & Wood Sts.,
Butler, N; J. Underwriter—R. A. Holman & Co., Inc.,
New York, N. Y.
■,
" •
'y'- '

•

Inc., Indianapolis, IndM

^

^ Cascade Pools Corp.
Nov. 30 (letter of notification) 100,000 shares of common
stock (par 10 cents). Price—$1 per share. Proceeds—For

ir Central

be

invested

be

Dec. 7 filed

including debt reduction, drilling and work¬
No. 4th St., Bismarck, North

lis, Minn..

Casualty Co. of New York
250,000'shares of Class A

Price—To

(par $1).

working capital. Office—135 S. La Salle Street, Chi¬
111,
Underwriter—David Johnson &
Associates,

per

filed

Inc.

cago,

ramento, Calif.: Underwriter—Dene & Co., Inc., also of
Sacramento.
Note-^-Deno Evangelista
is President of
both thS* issuing company and the underwriting firm
The issuing company is newly organized, and'anticipates
that its original minimum capital
requirement of $100,000
will be raised' by investors exchahgmg their -marketable

filed 21)0.000 shares of common capital stock.
Price—$4 per share.
Proceeds—For general corporate

ing capital.
Office—420
Dakota.
Underwriter—J.

and

stock

^Citizens Financial Fund, Inc.

30

purposes

of New York

income-producing securities.
Office—33 Maiden Lahe, New York City. Underwriter—
Lee Higginson Corp.
^
-

tal.

Petroleum

9

ceeds—To

$690,000, with the balance to be used for working capi¬

Cardinal

Insurance Co.

Electronics,

Price—$2.50 per share. Proceeds—For general corporate
purposes, inclding expansion, new product development.

Pomrock, President.

......

Sept. 14 filed 140 shares ot voting common stock.

Nov.

Life

filed 60,000 shares of common

jlu

Combined

39

Oct. 30 filed 800,000 shares of
common stock

(par $10).
Price—$20 per share. Proceeds—For working capital.
Office—150 Broadway, New York City. Underwriter—
The stock will be sold through the efforts of the officers
and
directors of the company, principally Moslie B.

general corporate purposes. Office—3955 South State St..
Salt Lake

(2435)

City, Miss.
Underwriter—The offering is to be made
through Coastal employees with Miss. Chemical under¬
writing on a "best efforts" basis, receiving a selling
commission of 33 cents

share,

a

-

.

Columbian Financial Development Co.

Aug.

$1,000,000

filed

14

Plans

of

for

Investment

in

Shares in American Industry, of which $500,000 was for

Single Payment Investment Plans and $500,000 for Sys¬
tematic Investment Plans and Systematic Investment
Plans With Insurance. Office—15 East 40th Street, New
York.
Underwriter
None.
Offering — Expected some
time after Jan. 1, 1960.
—

Conde Nast Publications, Inc.
Oct. 30 filed 501,863 shares of common stock

(no par)

being offered for subscription by
on

the basis of

one new

common stockholders
share for each two shares held.

Rights expire Dec. 11. Price—$8 per share. Proceeds—
To retire $3,500,000 bank loan incurred in connection
with the acquisition of Street & Smith Publications, Inc.
last August. Office—420 Lexington Avenue, New York
City. Underwriter—None.
The registration statement
became effective Nov.

24.

•

Conetta Manufacturing Co. (12/14)
Sept. 28 filed 100,000 shares of class A common stock (par
10c). Price—$4 per share. Proceeds—For working capital;
to prepay a

bank note; and for machinery and equipment.
Avenue, Stamford, Conn. Under¬
writer—Vermilye Bros., New York.
Office—73 Sunnyside

•

Consolidated

Development Corp.

Aug. 28 filed 448,000 shares of common stock (par 20c),
of which 1198,000 shares are to be offered to holders of
the issuing company's 6% convertible debentures, and

100,000 shares are to be offered to the underwriter, with
remaining 150,000 shares, in addition to those shares
described above not subscribed for by the debenture
holders and the underwriter, respectively, to be pub¬
licly offered. Price—For the shares to be offered to the
debenture holders, 75c per share, which is equal to the
price at which the debentures are convertible into com¬
mon stock; for the shares to be offered to the under¬
writer, $1 per share; for the shares to be offered to the
public, the price will be related to the current price of
the outstanding shares on the American Stock Exchange
at the time of the offering.
Proceeds—For general cor¬
porate purposes.
Note — This company was formerly
the

CALENDAR

ISSUE

NEW

December 11

First

Barney

&

The First Trust Co.

—Debentures

Bell

—Common

Co.; Kirkpatrick-Pettis Co. and
of Lincoln, Neb.) 370,000 shares

Telephone Co. of Pennsylvania...Debentures

Corp. and Wood,
Inc.) $20,000,000

Boston

Gundy & Co.,

(Tuesday)

Manufacturing Co

(Smith

(Friday)

Alberta Municipal Financing Corp
(The

December 15

Behlen

(Bids

11

a.m.

EST)

$30,000,000

Copperweld Steel Co
December
Anelex

Corp.

Anelex

Corp.

(Monday)

14

^.—..—Debentures

(First

.—Common

Bowmar Instrument Corp
(Pftine, Webber, Jackson & Curtis)

.Common

Common

Western

Clark

(General Investing Corp.)

Dyna-Therm

Midwestern
(William

R.

&

Sullivan

&

200.000 shares

Federation,

Tobin

Boettcher

Co.,

Inc.)

A.

Lomasney Ss Co.)

National Video Corp
'

(Bache

&

Common

( Van

Palomar

.Debentures

17,000 shares

(J.

Turner

Timber

A.

Hogle

&

Co.)

Turner Timber
(Frank

Hunt

Co.,

Inc.)

Marine,

Vietoreen

125,000 shares

&

Co.)

'

5 4'

$1,250,000

of America, Inc.)

shares

$300,000

(Tuesday)
to

invited)

be

Service

Gas

—Common

(Bids

200,000

shares

Bonds

Co

to

be

& Co.)

Cooperative Association
$9,000,000 of 5Vz% 25-year subordinated
certificates of indebtedness and 120,000 shares of pre¬
ferred stock (par $25). Price—The certificates are to be
3

filed

$25 per share. Proceeds—To be
of the association and be used for

tificates

of

indebtedness

Mo.

and for

added to general funds
retiring maturing cer¬
capital

expenditures.

Underwriter—None.

Continental Reserve Co.
Nov. 13 (letter of notification) 300,000

shares of

common

(par 30 cents). Price—$1 per share. Proceeds—To
invest in the common stock of its proposed subsidiary,
Continental Reserve Life Insurance Co. Office—914-916
Kearns Bldg., Salt Lake
lumbine Securities Corp.,

City, Utah. Underwriter—Co¬
Denver, Colo.

invited)

•,

December 21

(Monday)

Petroleum
(J.

Common

Co—

M. Dain

& Co:, Inc.) $800,000

(Monday)

$2,500,000

Bonds

Washington Water Power Co.
(Kidder. Peabody & Co.; Blytb

Co., Inc.; White, Weld & Co.
o. >

Washington Water Power Co

Debentures

Instrument Co.

(Van Alstyne, Noel



Consumers

Office—Kansas City,

.Debentures

Inc

(Boenning

19
(Bids

January 11

.—Common

'Boenning & Co.)

(par $1).
Price—$5 per share. Proceeds—To pay outstanding notes
and for working capital. Underwriter—Consolidated Se¬
curities Corp., of Pompano Beach. Fla., on a best efforts
basis.
Note—Nick P. Christos is President of the issuing
company and a director of the underwriting corporation.

• Cooperative Grange League Federation

$2,000,000

United Marine, Inc.—
United

January

Cardinal

Debentures
&

Corp., Pompano

Beach, Fla.
Nov. 24 filed 140,000 shares of common stock

stock

Louisiana

250,000 shares

Corp
P.

1,115,000

Kansas Gas & Electric Co.—*

—Common

(Frank P. Hunt & Co., Inc.)

underwriting)

$750,000

Corp

Underwriter—H. Kook & Co., Inc..

at

....Common

(Friday)

Debentures

Palomar Mortgage Co

Its

offered in units of $100; the preferred stock is to be sold

Dynamics International Corp....Common

.Common

Hogle & Co.) 80,000 shares

(J. A.

Aircraft

$300,000

Corp.—

stockholders—No

to

Inc.)

Co.,

&

Beach, Fla.

Consolidated Development

Nov.

$300,000

(Monday)

January 15

Common

Co

Co.)

Common

Holman

(Aviation Investors

—

Alstyle, Noel & Co.)

Mortgage

——__-Common
Securities

General Public Utilities
(Offering

...Common

A.

January 4

283,307 shares

Nedick's Stores, Inc.—

$150,000

Fish Boat Co.
(R.

$600,000

_

Co.)

Corp.)

(Thursday)

(Pleasant

Common

30,000 shares

Mohawk Business Machines Corp

Investing

December 17

Red

Common

—

(General

& Co. and Bosworth,
250,000 shares

Co.;

Lomasney & Co.)

(Myron

.Common
235,000 shares

Craft, Inc.-

offices.

changing the corporate

sanctioning its entry into real estate opera¬
Offering—Expected prior to Jan. 1.
Office—

Miami

•

$600,000

Inc

Peabody & Co.)

amended last June,

was

Corp., which

corporation with Havana

and

name

Common

CO.)

Consolidated Cuban Petroleum

New York.

(Wednesday)
Morgan &

as

Delaware

a

tions.

Common

Minitran Corp.

50.000 warrants

Corp.)

Mohawk Business Machines Corp
(Myron A.

$1,500,000

Co.)

&

was

charter

Debentures

Chemical Corp

(Kidder,

$300,000

Corp..——

Financial
Staats

16

(Peter

Micronaire Electro Medical Products Corp..—Wts.
Investing

shares

Inc..

Fuller

D

December

Micronaire Electro Medical Products CorpLJv Com.

(General

known

Common
89,285

Corp.)

(Merrill Lynch, Pierce, Fenner & Smith Inc.) 800,000 shares

Financial

—Common
Inc.)

Van Buren,

&

$404,106.50

$1,500,000

Co.)

King's Grant Inn, Inc
(Osborne,

Industries,

Debentures

Corp
Haupt &

(Ira

Space

Lane,

(S.

(Myron A. Lomasney & Co.) $600,000

&

Corp.)

Street

$400,000

Bros.)

Dynex, Inc
Gulf

Broad

Public Service Electric & Gas Co

.Common

Manufacturing Co...
(Vermilye

Perrine

78,000 shares

Citizens Casualty Co. of New York—...Common
(Lee Higginson Corp.) 250,000 shares
*

$8,000,000

Common

Industries, Inc

(Johnson,

—

Conetta

Tile

Florida

shares

90,000

Co.)

(Putnam &

Electronics Development, Inc.

$2,250,000

Co.)

(Putnam &

.Debentures

(Dillon, Read & Co., Inc. and Rlter & Co.)

$10,000,000

-

.

,

Debentures

(Kidder, Peab^dv A Co.; Plyth & Co., Inc.; White, Weld
and Dean Witter & Co.) $5,000,000

Co.

Exchange, Inc.
of 4% subordinated debentures, 10,000 shares of 4% cumulative preferred stock, and 200,000
shares of common stock. The common shares may be of¬
Dec.4 filed $250,000

fered only to present or

prospective members of the Co¬

operative. Prices—For the debentures, 100% of principal
amount; for the preferred, $100 per share; for the com¬
mon, $5 per share. Proceeds—For general corporate purContinued

on

page

40

40

The Commercial and Financial Chronicle

(2436)

Continued from page 39

Delaware

'

Nov.
poses, including future redemptions of outstanding secu¬
rities and property additions and improvements. Office

—Terrace

Hill, Ithaca, N. Y.

Underwriter—None.

•

Corp.

Office—50

New York.

Broadway,

Financial

Nov.

700,000 shares of common stock (par one
Price—$5 per share. Proceeds—For working cap¬

cent).
ital.

Securities

filed

13

1

filed

for

100,000 shares of common stock. Price—To
be supplied by amendment. Proceeds—For general cor¬
porate

purposes.

Office

—

Lima

Western

&

Avenues,

Findlay, Ohio. Underwriters—Paine, Webber, Jackson &
Curtis, Boston, Mass., and Prescott, Shepard & Co., Inc.,
Cleveland, O. Offering—Expected in January.
Copperweld Steel Co. (12/15-18)
Nov. 16 filed $8,000,000 of convertible subordinated de¬
bentures, due Dec. 1, 1979. The company has applied for
the listing of the debentures on the New York Stock Ex¬
change.

Price—To be supplied by amendment. Proceeds
repay short-term notes with the balance to be

-^To

added

to general funds.
Underwriters—Dillon, Head &
Co., Inc., and Riter & Co., both of New York.

Copymation, Inc.

,

(formerly Peck & Harvey Mfg.

Company)
Sept. 23

(letter of notification) 100,000 shares of com-v
mon
stock (par 50 cents).
Price—$3 per share. Pro¬
ceeds—To pay bank loans and loans to stockholders and
others

and

for working capital.
Office—5642-50 North
Avenue, Chicago 45, 111. Underwriter—Sim¬
Co., (handling the books) and Plymouth Secu¬
rities Corp., both of New York, N. Y. Offering—Expected
any day.

Western
&

mons

Coraloc Industries,
Oct.

Inc.
(letter of notification) 5,450 shares of common
(par $5) and 27,250 shares of preferred stock (par

30

stock

$10) to be offered in units of five shares of preferred
and one share of common. Price—$55
per unit. Proceeds
-r-For engineering and technical costs, sales, services, etc.
JSusiness—Manufactures swimming pools.
Office—494
»S.
San
Vicente
Boulevard, Los Angeles 43, Calif.
Underwriter—Edward Lewis Co., Inc., New York, N. Y.

Offering—Expected in two to three weeks
SEC clearance).

Cornbelt

Sept.

29

offered
record

Insurance Co.,

200,000 shares of common stock to be
subscription by common stockholders of
Sept. 15, 1959, at the rate of four new shares

increase

Unsubscribed shares may

publicly. Price—$4 per share. Proceeds—
capital and surplus.
Underwriter—None,

but brokers and dealers who join in the distribution will
receive commission of 40 cents per share.

Cornbelt

Life Co.

Sept. 29 filed 100,000 shares of common stock, to be of¬
fered to stockholders of record Sept. 15 on the basis of
one
share for each share then held.
Price—$4.50 per
share. Proceeds—To be credited to stated capital and
paid-in surplus. Office—12 North Galena Avenue, Free-

port, 111.

Underwriter—None.

,,

1

Crest Investment Trust, Inc. *
Nov. 30 filed 1,172 shares of type A and 7,400 shares of

type B

stock, together with $42,500 of 6% de¬
benture notes. Price—$110 per share of stock; the notes
will be offered in units of $500. Proceeds—For expan¬
common

sion. Office—41 W. Preston St., Baltimore,
Crown

Nov.

30

Aluminum

Industries

Md.

Corp.

filed

$1,500,000 of 17-year, 7Va% debentures,
due Jan. 15, 1977, and 180,000 shares of common stock,
to be offered in units of $100 of debentures and 12 shares
of stock.
Price—$160 per unit; and $6.50 per share for
an additional 100,000 shares included in the registration
statement

and

not

covered

above.

Proceeds—For

gen¬

eral

corporate purposes, including 1,200,000 for install¬
ing and equipping a hot rolling mill. Office—202 ^Rey¬
nolds

Arcade

Bldg.,v Rochester,

Adams & Peck, New York City.

N. Y. UnderwritersOffering—Expected m

January.
Crusader Oil & Gas Corp., Pass

Christian, Miss.
'May 26 filed 1,500,000 shares of common stock, of which
641,613 shares will be offered on a one-for-one basis to
.

stockholders.

fered

The remaining 858,387 shares will be of¬

the underwriter on a "best efforts"
basis. Price—To be supplied by amendment.. Proceeds—
For repayment of notes and for working capital. Under¬
writer—To be supplied by amendment.
publicly

by

Dallas Power &

'

'

-

'

.

•

•

.

Light Co.
Nov. 10 filed $20,000,000 of first mortgage bonds, due
1989.
Proceeds—To repay short-term borrowings from
Texas Utilities Co., the parent company, which amounted
to $12,500,000 on Sept. 30, with the balance to be used
for general corporate purposes, including construction.
Underwriter—To be determined by competitive bidding.
Probable bidders: Halsey, Stuart & Co. Inc.; The First
Boston Corp.; Salomon Bros. & Hutzler; Kidder, Peabody & Co. and Merrill Lynch, Pierce, Fenner & Smith
Inc. (jointly); Eastman Dillon, Union Securities &
Co.;
Blair & Co., Inc. and Baxter & Co.
(jointly); Lehman
Brothers. Bids—Expected to be received
up to noon on
Dec. 14.

Davega Stores Corp.
25 filed 88,000 shares of

Nov.

fered
t

to present stockholders at
hare for each three shares held.

the

stock

rate

of

to

be

one

of¬
new

Price
$7 per share.
For expansion and other
corporate purposes.
Office—215 4th Ave., New York

Proceeds

—

—

City,

None.

Underwriter—

Dayton Aviation Radio & Equipment Corp.
Sept. 28 filed 201,050 shares of common
stock, of which
190,871 shares are to be offered to holders of
outstanding

/../

.■

.■

Cantor

&

•

used

Don

a

Pa.,

a."best efforts"

on

Oct.

convertible into

common

debentures.

Price—At

face

stock at $4 per

amount.

as

10-year

Debentures

6%

the

working capital.
\

,

■;

....

Office—
...

balance

to

be added to
working capital. Office
Boulevard, Pacific Palisades, Calif. Under¬
writer—Hill, Darlington & Co., New York City. Offering—Expected later this month. ! '■

—

per

reduce

Gas Hills Uranium Co.,
Oct. 28 filed 6,511,762 shares

3,990.161

are

to

521,601 shares

be

are

offered
owned

at

the

rate

ties and
tain

one

are

share

new

to be

1

the basis of one-half share
share of preferred for each

Office—1949 North

count

of

the

offered in exchange for
proper¬

are

—

in two to three weeks' time
(subject

approval).

Underwriter—ESA

Distributors, Inc., Washington,
D. C.
Office—1028 Connecticut
Avenue, N. W., Wash¬
ington, D. C.
.

(12/15)

common

stock

(par 10c).

share. Proceeds—For
plant erection, ad¬
vertising, research
and
development, and working
capital.
Office
Gill and West
per

—

College Streets, State
College, Pa. Underwriter—First Broad
Street Corp., 50
Broad St., New York.

Fastline, Inc.

Nov. 6

(letter of notification)
100,000 shares of common
10 cents).
Price—$3 per share. Proceeds—
corporate purposes., Office—8
Washington
Place, New York, N, Y. Underwriter
Mortimer B.
Burnside &
Co., Inc., New York, N. Y.
Offering—Ex¬
pected any day.
'

(par

general

—

Corp.

of 6% subordinated

Street, San Diego, Calif. Underwriter'
—Eastman Ddlon, Union
Securities & Co., New York.
any day.

ac¬

supplied by amendment.

Street, Laramie, Wyo.
Gence &

Underwriter—-None.

Associates, Inc.

Nov. 13 (letter of
notification) 100,000 shares of common
stock (no par).
Price—$3 per share
Proceeds—To pay
an

outstanding obligation, and for working capital. Office
E. Colorado
St., Glendale, Calif. UnderwriterCalifornia Investors, Los
Angeles, Calif; v : '

—1500

Coil

Products Corp.

(letter of notification) 99.000 shares of common
stock (par 10
cents); Price—$3 per share, Proceeds—For
automation of
operations; working capital; additional
equipment and machinery and research and develop¬
ments Office—147-12

Liberty Ave.. Jamaica. N. Y. Un¬
derwriter—A. T. Bred & Co., New York and Washington,
D.

C.
Offering—Expected in two weeks (subject
Securities and Exchange Commission
clearance)..

to

^General Electronic

Laboratories, Inc.
(letter of notification) an undetermined number
shares of class A common stock
(par 33Ys cents)
amounting to approximately $300,000 to be offered to
officers, directors and
employees of the company. Pro¬
Nov. 20

of

ery,

Offering—Expected

be-offered for the

Proceeds—For general corporate
purposes, including the
repayment of indebtedness.
Office —604
South 18th

ceeds—For general corporate

Fund, Inc.
2,000,000 shares of capital stock. Price—To
supplied by amendment. Proceeds—For
investment
Investment
Adviser—Yates, Heitner & Woods, St. Louis,
Mo.

^ted $3,000,000

to

cer¬

promissory

selling stockholders, of " which number 655,500
represent holdings of management officials and
affiliated persons. Price—To be

be

^T°v*

to be offered to

convertible

,

stock (par 10c),
publicly offered. Price

Fed-Mart

are

company's

ESA Mutual
June 29 filed

•

common
shares held;

20

of

Oct. 29

per share. Proceeds
To provide funds for the
purchase of vending machines
which will be used to
distribute automobile breakdown
insurance policies on
thruways, parkways and highways in the amount of $25
of such breakdown
insurance for the purchase
pi;ice of
25 cents, and for a
public relations and publicity pro¬
gram.
Office—Hotel Troy Building,
Troy, New York
Underwriter—John R. Boland &
Co., Inc., New York

stock

each

shares

General

E. H. P; Corp.
Aug. 31 filed 160,000 shares of
capital
of which 100,000 shares
are to be

For

for

services; 326,883 shares

holders

notes: and: 2,748.278 shares,

Ekco Products Co.
Dec. 4 filed 21,609 shares of second
cumulative preferred
stock, 6% series, and 54,064 shares of common
stock, to
be offered in
exchange for the common stock of Wash¬

Price—$3.50

stock, of which
remaining 2,-

The

or

outstanding

of

500,000 shares

—

Inc.

of common

for sale.

underlie options owned by
officers and/or
directors, affiliates, and associates of the
issuing company. Of the shares to be sold,
415,000 shares
are to be offered to
holders of the

including product research, the pur¬
equipment, and expansion. Office
123
Eileen Way,
Syosset, L. I., N. Y. Underwriter—Myron At.
Lomasney & Co., New York.

Electronics
Development,
Sept. 25 filed 115,459 shares of

v-.

17315 Sunset

up

porate purposes,
chase of new

to SEC

Street, West
Alexik & Co,

'

;

—

are

Dynex, Inc. (12/14)
Aug. 6 filed 120,000 shares of common stock
(par 25
cents). Price—$5 per share. Proceeds—For
general cor-

Offering-—Expected

Underwriter—DiRoma,

Co., Ltd.
Nov-. 9 filed 200,000 shares of common
stock (par $1),
Price
To be supplied
by amendment. Proceeds —For
land conversion and
improvement in California, with

•

—$2.50

re¬

Garden Land

—

a

short-

loans.

Central

—

Washington Steel.
Cicero Avenue,
Chicago, 111.

bank

Springfield, Mass.
Springfield,, Mass.

share up to and

Proceeds—To

share of

(12/15-24)

advertising,

subsidiaries, for payment of loans, and for working cap¬
ital.
Office
Culver City, Calif.
Underwriter
Peter
Morgan & Co., New York City.

common

Inc.

duction of indebtedness,
bottling equipment, payment of
$44,000 for acquisition of formula
409, a liquid degreaser
and office equipment.
Office—10

^convertible

South Dixie
Highway, Troy, Ohio,




term

Dyna-Therm Chemical Corp. (12/16)
Oct. 28 filed
200,000 shares of capital stock (par $1).
Price—$3 per share. Proceeds—To purchase stock ot

of common and one-fifth of

Industries,

Office—Lakeland, Fla. Underwriter
—Johnson, Lane, Space Corp., Atlanta, Ga.
Formula 409, Inc.
(
0<?t. 29 filed 300,000 shares of common stock
(no par)
Price—$1.50 per share. Proceeds—For

payable, to purchase facilities and equipment, arid
for working capital.
Office—401 E. Boyd St., Norman,
Okla. Underwriter—None.

on

Tile

89,285 shares ol class A common stock
(par
$1). Price—To be supplied by amendment.
ProceedsIt is expected that about
$437,500 will be used for additional working capital and/or general
corporate purposes
of which $250,000 may be
expended for additional facib
ities, and that about $87,500 will be used to retire

notes

ington Steel Products, Inc.,

Statement effective Oct. 9.

Florida

>

of

Phoe.

nix, Ariz. Underwriter—O'Malley Securities Co..'
Phoe¬

Sullivan, Inc., Philadelphia,

debentures,
of the record date on the basis of one
new share^~
through Nov. 30, 1969.
for each four shares then held.
Price—To be supplied
Price—$1.50 per share.
by amendment. Proceeds—For
~
Proceeds—To finance government
intermediate- and lo»g-term
contracts, reduce ac¬
capital requirements. Of¬
counts payable, and increase
fice—8001 Othello

stock

land in Arizona. Office—1802 North
Central Ave.

Inc.

including Nov. 1, 1962; thereafter at $8 per share
to and
including Nov. 1, 1965 and thereafter at $12

share.

Northern

nix.

basis/Offering—Expected shortly.

subordinated

)

capital.stoclr

investment. Office
Distributor—FP

Nov. .12 filed

Laboratories, Inc.
(letter of notification) $160,000

2

common

companies, numbered "second" through
"eighth"'
Price—$10,084 to $10,6*98 per unit. Proceeds—To
purchn^

.•

Dorsett

;

»

Fund, Inc.

shares of

Proceeds—For

Olive

building and the financing of loans. Office—Orlando,
Underwriter—Leon H.

Boulevard
Peabodv

First Northern-Olive Investment
Co.
Aug 17 filed 20 partnership interests in the
partnership
Similar filings were made on behalf of
other

Oct. 27 filed 161,750 shares of class
B, non-voting, com¬
mon
stock (par $5). Price—$10 per share. Proceeds—
For general corporate
purposes, including payment on
Fla.

•

Broadway, Denver, Colo. General
Management Corp., Denver, Colo.

Goldman

Associates,

Wilshire

Underwriter—Kidder,

950

as

Mott

($i

Proceeds—Most!

y

Price—At market.

Builders, Inc., with the balance to
working-capital. Office—29A Sayre Woods
Shopping Center, Madison Township, P. O. Parlin, N. J.
Underwriter—Lee Higginson Corp., New York.
be

stock

notes, with the balarW

Office—5150

Calif.

<

capital

Industrial Income

Financial

Diversified Communities, Inc.
Sept. 25 filed 367,200 shares of common stock (par $1).
Price-—To be supplied by amendment. Proceeds—For ac¬
quisition of Hope Homes, Inc., Browntown Water Co. and

•
common

/

•

_

Angeles,

July 22 filed 1,000,000

Laboratories, Inc.
July 31 filed 50,000 shares of common stock (par $2.50).
Price—$10 per share. Proceeds—For general corporate
purposes, including salaries, cars, promotion, inventory,
the establishment of branch offices, expenses incidental
to obtaining permission to do business in other states,
and the establishment of a contingency reserve.
Office
—1420 East 18th Avenue, Denver, Colo.
Underwriter—
None.

(12/16)

of

Co., New York.

Denab

convertible

filed

Products,

capital.

working

Los

Inc.
Oct. 15 filed $330,000 of convertible debentures, and 70,000 shares of common stock. Price—For the debentures,
100% of principal amount; for the stock, $5 per share.
Proceeds—From 10,000 shares of the common stock, to
the present holders thereof; from the rest of the offer¬
ing, to the company to be used for expansion and as
working capital. Office—6810 S. W. 81st St., Miami, Fla.

,

for

offered

To

-

Freeport, III.

for each 10 shares then held.
be

(subject to

/

Deluxe Aluminum

shares

supplied by amendment.

for the repayment of short-term

Underwriter—
,

Dec.

Thursday, December 10, 1959

.

235,000

Price—To be

None.

Cooper Tire & Rubber Co.

-

.

Federation, Inc.

filed

6

.

purposes,.including machin¬
equipment and working capital. Office—195 Massa¬
Avenue,
Underwriter —
Cambridge, Mass.
Kidder. Pcabody &
Co., Inc., Boston, Mass. on a "best

chusetts

efforts" basis.

General Finance
Corp.
Sept. 11 filed 150,000 shares of

common

stock.

share.

Price—jg

Proceeds—For working capital, .with $15,000
being allocated for lease improvements and equipmea*
per

and

supplies.
Office
Santurce, Puerto Rico.
writer—Caribbean Securities Co.,
Inc., Avenida
609, Santurce, Puerto Rico.

Und®J"

—

Condado

• General
Public Utijities
Corp. (1/4)
Nov. 24 filed
1,115,000 additional shares of common stocK
(par $2.50) to be offered to common stockholders ot

record

Dec. 30,

1959,

on

the basis of

one

new

share for

each 20 shares

se held:
rights to expire on Jan. 19, 196UPrice—To be supplied
by amendment. Proceeds—To
short-term bank
loans, and the balance will be added

to

the

general

funds

None,

but

solicit

subscriptions.

Gold

dealers

Medal

of

may

the

sell

company.

Underwriter-;

unsubscribed

shares

Packing Corp.

June 18 filed 572,500 shares of common stock
cent), and 50,000 common stock purchase
the

shares

anci

400,000 will

(par

ODJ

warrants.UJ

of
company: 110,009 by certain stockholders;. 12,300 for to
underwriter; and the remaining 50,000 shares are
be sold

for

the

account

Volume

190

dumber 5906

.

.

.

The Commercial and Financial Chronicle

chasable upon exercise of the warrants. Price—$1.25 per
share. Proceeds—For repayment of debt; purchase of
equipment and facilities and other general corporate
purposes. Office—614 Broad St., Utica, N. Y. Under¬
writer—Mortimer B. Burnside & Co., New York. Name
Change — Formerly Eastern Packing Corp.
Gold Medal Studios,

Inc.

Sept. 18 filed 500,000 shares of common stock (par 10
cents). Price—$1 per share. Proceeds—For general cor¬

porate purposes, including the purchase of additional
studio equipment, investing in properties in the enter¬
tainment field, and the provision of funds for a down

payment on another building or buildings.
E. 175th

Malkan

Street, New York, N. Y.
& Co., Inc., New York.
Products,

Granco

Office—807

Underwriter—Arnold

of common stock (par 50 cents). The stock is
underlying the warrants, and the purpose of the filing
was to permit the warrant holders to exercise their war¬
rants and buy the underlying stock at $2.50 per share

shares

during the life of the warrant. The expiration date of
the warrant is Feb. 25, 1961.
The price of the warrant

market. Proceeds—In the first instance, to the
warrant holders; if they convert, Granco's treasury will
receive $2.50 per share. Office—36-17 20th Ave., Long
is at the

Island City, N. Y. Underwriter—John R. Boland & Co.,

Inc., New York City.

Bowling Corp.
Aug. 31 filed 120,000 shares of common stock (par $1).
be

supplied

general corporate
bowling

of

amendment.

by

purposes,

lanes,

bars,

Proceeds—For

including the development

and

restaurants

an

,

various

Michigan properties.

Office—6336 Woodward Ave., De¬
troit, Mich. Underwriter—Straus, Blosser & McDowell,
Chicago, 111. Offering—Expected sometime after Jan. 1,

Greater

Washington Industrial Investments, Inc.
20,500 shares of common stock (par $1).

filed

4

Price—$8.50

per

share. Proceeds

—

small businesses. Office—1625 Eye

For investments

in

St., N. W., Washing¬

ton, D. C. Underwriter—None.
River

Green

Production Corp.

Oct. 15

(letter of notification) 200,000 shares of common
(par 50 cents). Price—$1.50 per share. Proceeds—
for exploring for oil and gas. Office—212
Sixth Ave., South, Nashville, Tenn. Underwriter—Cres¬

stock

For expenses

cent Securities

Greer

Co., Inc., Bowling Green, Ky.

Nov. 27 filed 250,000 additional shares of

common

stock

.($.50 par) to be offered for subscription by holders of
ithe outstanding common. Price — To be supplied by

Office—Jamaica, L. I., N. Y. Proceeds—
in Los Angeles, with the balance

To relocate

company

4

filed

common stock, which
were issued to Avco Corp. on Dec. 8, 1958, at $2,375 per
shares, and which will now be publicly offered by Avco.
Price—To be related to the prices prevailing in the

over-the-counter market at the time, or times,
sold. Office—1030 South Arroyo Parkway,

Ts

Cailf.

Office— 1825
Investment

market.

Connecticut
Advisor

Washington.
ment

shares

D.

C.

of

common

stock

Proceeds—For

(par

10

investment

Washington, D. C
Advisory
Service,
Underwriter—Investment Manage¬
—

Avenue,

Investment

Associates, Inc., Washington, D. C. The statement

the stock
Pasadena,

Underwriters—The offering will be made through

registered brokers and dealers who

are

NASD members.

I C Inc.
June 29 filed

600,000 shares of
share.

per

common

stock

(par $1).

Proceeds—To further the corpo¬

rate purposes and in the

preparation of the concentrate

Nov.

as

required,

to

finance

counts receivable

on

increased

inventories

and

ac¬

behalf of subsidiaries. Office—4615

Empire State Bldg., New York. Underwriter—Ira Haupt
& Co., New York City.

+ Hanover Tool Co., Inc.
Dec. 1 (letter of notification) 30,000 shares of common
capital stock (par $1). Price—$5 per share. Proceeds—To
purchase
reduce

material, to finance future receivables and to
indebtedness. Office—449 York St., Hanover, Pa.

Underwriter—None.

Colo.

18

Co., Inc.
(letter of notification)

Leasing Corp.

1

(letter
convertible 6%

convertible
fered

in

subordinated

denominations

debentures
of

$500

of 6%

be

of¬

Debentures1

are

series

each.

10-year

A

to

%nvertible

into class B common stock at the rate of .five
shares for each $500 debenture. Price—At par. Proceeds
—For working capital. Underwriter—Eastern Investment
Corp., Manchester, N. H.
(H. M.) Harper Co.
Nov. 6 filed 100,000 shares of common stock (par $1),
of which 60,000 shares are being offered for the account
of the issuing
company, and 40,000 shares are being of¬
fered for the accounts of the present holders thereof.

Price—To

be

supplied

by

amendment.

Proceeds—For

Office — Morton Grove, 111.
Underwriter—Blunt Ellis & Simmons, Chicago, 111 Of¬

general corporate purposes.

fering—Expected in mid-December.

$50,000 subordinated convertible 6% debentures ($500
denomination). Price—100% of principal amount. Pro¬
ceeds—For working capital.
nue,

Portland 4, Ore.

Office—522 S. W. 5th Ave¬

Clearance date

was

June 9.

Inland Western Loan & Finance Corp.
Sept. 24 filed $1,000,000 of 6% capital debentures. Price
—To
be
supplied by amendment.
Proceeds—To dis¬
charge loans from banks and from the Commercial Life
Insurance Co.; to furnish operating capital for subsidi¬
aries; and to establish new subsidiaries or branches of
already existing ones. Office—10202 North 19th Ave.,

Underwriter—The underwriters, if any,
by amendment.

will be named

mon

filed

stock.

157,000 shares of common stock

Heli-Coil is not obligated to

100% of the Grip Nut shares, but at its
to

a

then

accept less than

option may do so
lesser degree, though not less than 80%.
It will
issue a number of shares proportionately reduced




stock,

to

be

King's Grant Inn, Inc. (12/14-18)
9 (letter of notification) 30,000 shares of common
stock (par $1). Price—$10 per share. Proceeds—To pay
off

loans

to banks, constructions, purchase of a farm
working capital. Address—R. F. D. No. 3, Laconia, N. H. Underwriter—Osborne, Clark & Van Buren,
Inc., New York, N. Y.

inn and

4r Kit Manufacturing Co.
Nov. 30

(letter of notification) $100,000 of 7% five-year
Price—At par. Proceeds—For working cap¬
Office—1401 W. 17th St., Long Beach 13, Calif. Un¬

debentures.

Kittanning Telephone Co., Kittanning, Pa.
Aug. 24 filed 14,000 shares of common stock, being of¬
by subscription to holders of outstanding common

fered

the basis of

approximately 0.212 new shares for
on
Nov.
14, 1959; rights to expire1959. Price—$25 per share. Proceeds—In
part to repay a bank loan in the amount of $450*000 rep¬
resenting funds acquired for general modernization, im¬
on

on

share

Dec.

held

15,

provement, and expansion.

Underwriter—None.

it Lafayette Radio Electronics Corp.
Dec. 4 filed 275,000 shares of common stock ($1 par).
Price—$5 per share, Proceeds—For general corporate
purposes including inventory, leasehold improvements,
and working capital.
Office— 165-08 Liberty Avenue,
Jamaica, L. I., N. Y. Underwriter—D. A. Lomasney &
Co., New York City. Offering—Expected in January.
•

Lake Aircraft

Corp., Sanford, Me.
135,000 shares of class A common stock
(par 10 cents). Price—$3 per share. Proceeds—To repay

Nov.

filed

20

$25,000 indebtedness to the Sanford Trust Co., for re¬
maining payment on purchase by the company of certain
assets of Colonial Aircraft Corp., and for other corporate

land, Calif.

purposes.

filed

3

an

.

Integrand
13

•

Corp.

filed

85,000 shares of common stock (par 5c).
share. Proceeds — For general corporate
including the redemption of outstanding pre¬
per

stock

ferred

amendment to its

and

new

plant

equipment.

Office—WestCo.,

bury, L. I., N. Y. Underwriter—DiRoma, Alexik &

7

Doc.

per

share.

Nov. 25

Price—-$3

Proceeds—For general corporate purposes.
Broadway, Denver, Colo.
Underwriter—•

Dec

year,

Street,

Washington, D. C.
notes (series B, $500,000, two-

Bank,

29 filed $5,000,000 of

3%

unit; series C, $1,000,000, four-year 4% pei

per

Laymen Life Insurance Co.
175,000 shares of common stock, of which

Nov. 30 filed

35,000 shares are to be offered by the company and 140,000 shares are to be offered by the Laymen of the Church

God, with which the company is merging. Price—To
supplied by amendment. Proceeds—For working cap¬
Office—1047 Broadway, Anderson, Indiana. Under¬
writer—To be supplied by amendment.

be

principal amount.

Irando Oil & Exploration, Ltd.
April 24 filed 225.000 shares of common stock. Price—90
cents per share. Proceeds—To defray the costs of explo¬
ration and development of properties and for the ac¬
quisition of other properties; also for other corporate
purposes.
Office—1950 Broad St., Regina, Sask., Can
Underwriter
Laird & Rumball, Regina, Sask., Can

Industries, Inc.
(letter of notification) $200,000 of 10-year 10%
registered debentures. Price-—$100 per debentures. Pro-

Nov.

23

Mceeds-*-For

Sunrise

Heft,

Office — 30 E.
Lindenhurst, N. Y. - Underwriter —
& Infante, Inc., Hempstead, L. I., N. Y.

general corporate purposes.

Highway,

Kahn

Israel

Development Corp.

ital.

• ''Led"
stock

(par

10

shares for each five

shares held.

basis of two
Price—$2.70 per

Proceeds—To purchase new

share.

material, warehouse

inventory, and for research and working capital.
Office
—2655 Pearl Street, Boulder, Colo. Underwriter—None.
Life

Insurance Co.

of Florida

Sept. 28 filed 203,476 shares of common stock (par $1).
Price—$4.50 per share. Proceeds—For expansion. Office

St., Miami, Fla. Underwriter—Plymouth
Corp., Miami.
■
'
■

—2546 S. W. 8th

Bond & Share

Liquid Veneer Corp.
(letter of notification) 150,000 shares of common

per share, payable in cash or State of Israel
Independence Issue or Development Issue bonds.
Pro¬
ceeds—For general corporate purposes. Office—17 E. 71st

stock

(par 10 cents).

Price —$2 per share.

Proceeds—■»

general corporate purposes.
Office — 211 Ellicott
Street, Buffalo, N. Y. Underwriter—B. D. McCovmack

For

Securities Corp., New York,

Underwriter—None.

40,113 shares of common

cents) to be offered for subscription by

stockholders of record Nov. 20, 1959 on the
new

Nov. 16

Street, New York City.

Ballast, Inc.

(letter of notification)

Nov. 23

Sept. 22 filed 200,000 shares of common stock (par $25).

Price—$27.50

Proceeds—
Woodward

Road, Englishtown, N. J. Underwriter—Prudential Se¬
Corp., Staten Island, N. Y.

of

of

Electronics Co., Inc.
(letter of notification) 133,000 shares of common

curities

Prlei

—100%

Gould, Salem, Mass.

stock (par one cent). Price—$1.50 per share.
For general corporate purposes.
Office —

Proceeds — For workinf
capital.
Underwriter—Johnston, Lemon & Co., Wash¬
ington, D. C. Offering—Indefinitely postponed.

unit; and series D, $3,500,000, 6-year, 5% per unit).

&

pike, Mineola, L. I., N. Y. Underwriter—Charles Plohn
& Co., New York City.
Offering—Expected in January.
Lawn

Aspirin Corporation
filed 600,000 shares of common stock.

+ International

Underwriter—Mann

Lancer

Industries, Inc.
Nov. 27 filed 200,000 shares of $.70 convertible preferred
stock (par $10).
Price—$10 per-share. Proceeds—For
general corporate purposes.
Office—22 Jericho Turn¬

Springfield, Mass.

N. Y.

rk Jessop Steel Co.
Dec.
4 filed $3,000,000 of convertible subordinated de¬
bentures, due Jan. 1, 1975. Price—To be supplied by
amendment. Proceeds—For general corporate purposes.

it Louisiana Gas Service Co. (1/19)
Dec. 4 filed $7,500,000 of first mortgage bonds.
Under¬
writer—To be determined by competitive bidding. Prob¬

&

Co.; Merrill Lynch, Pierce, Fenner & Smith Inc., and
Kidder, Peabcd.y & Co. (jointly); Salomon Bros. & Hutz¬

Weeks, New York

(without
par value) to be offered to holders of outstanding shares
of the capital stock (par $10) of Grip Nut Corp.
The
holders of 95.7% of the outstanding Grip Nut capital
stock entered into an agreement with Heli-Coil on Oct.
Oct. 21, 1959, to exchange their holdings of 103,055 shares
of Grip Nut stock for 150,850 shares of Heli-Coil's com¬
18

common

registration statement
covering additional units of its securities. Office—Oak¬

★ Insurance Securities, Inc.
D'^c.

Office—Washington,

Heli-Coil Corp.
Nov.

of

Nov.

each

notification)
$200,000 subordinated
debentures ($1,000 denomination) and

oi

Island

$50,000

shares

Co., Inc., Atlanta.

stock

Industrial

—

Harmar

Nov.

331,836

ital.

International

5 filed
subordinated
debentures, due Nov. 15, 1974. Price—To be supplied by
amendment. Proceeds—Initially for working capital, and,

filed

derwriter—None.

enfranchising of bottlers, the local and national pro¬
and advertising
of its beverages, and where
to make loans to such bottlers, etc. Office—
704 Equitable Bldg., Denver, Colo. Underwriters— Pur¬
vis & Co. and Amos C. Sudler & Co., both of Denver.

Speculative Securities Corp., 915 Washington
Wilmington, Del., on a "best efforts" basis.

Corp. (12/14-18)
$1,500,000 of 6% convertible

12

offered to the holders of the outstanding common stock
on the basis of one new share for each four shares held.

necessary

Guaranty Insurance Agency, Inc.
See, Mortgage Guaranty Insurance Corp., below.
Western

Kennesaw Life & Accident Insurance Co.
Nov.

motion

Office—1700

Gulf &

Co.

and

became effective July 24.
V ?

Co., Glore, Forgan & Co. and Gold¬
(jointly). Bids—Expected to be re¬
ceived up to 11 a.m. (EST) on Jan. 19 at Room
2033, Two
Rector Street, Nc-w York 6, N. Y.
&

Price—To be supplied by amendment.
Proceeds—For
general corporate purposes.
Office—165 Luckie Street,
Atlanta, Ga.
Underwriter — The Robinson - Humphrey

Hycon Manufacturing Co.
Aug. 28 filed 126,316 shares of

purposes,

America, Inc.

250,000

Price—At

of

Securities &

Sachs

man

plant machinery and working capital.
Office—8 Orchard Dr., Mt. Vernon, Ohio. Underwriter—
Hardy & Hardy, New York, N. Y. Offering—Expected

Price—$4

cents).

1

cost

Oct.

Growth Fund of

Union

Honeycomb Products, Inc.
10 (letter of notification) 90,000 shares of capital
'stock (no par). Price—$3 per share. Proceeds—To pay
the

Kansas Gas & Electric Co. (1/19)
Nov. 20 filed 200,000 shares of common stock
(no par).
Proceeds—Fcr the construction of electric facilities and

Lynch, Pierce, Fenner & Smith Inc., Kidder, Peabody &
Co. and White, Weld & Co.
(jointly); Eastman Dillon,

Nov.

for

41

for other corporate purposes. Underwriter—To be deter¬
mined by competitive bidding. Probable bidders: Merrill

Co., Denver, Colo. Offering—Expected shortly.

Co., New York City.

—

'

&

to be used for general corporate purposes, including the
reduction of indebtedness.
Underwriter
Burnham &

Feb.

registered.

Bros. Truck Co., Inc.
(letter of notification) 285,000 shares of com
mon stock.
Price—At par ($1 per share). Proceeds—Tt
pay existing liabilities; for additional equipment; &u<
for working capital.
Office—East Tenth Street, P. O
Box 68, Great Bend, Kan.
Underwriter—Birkenmay*

Fhoenix, Ariz.

Hydraulics, Inc.

;amendment.

has

11

June

1960.

Nov.

(Heli-Coil)

it

Hickerson

March

Price—$2.50

Lakes

Price—To

the 157,500 which
Office—Danbury, Conn.

from

in about two weeks.

Inc.

Oct. 21 (letter of notification) 42,860 warrants and 60,000

Great

(2437)

Kansas

Pa.

Underwriter—Hornblower

City.

City Power & Light Co.
Nov. 30 filed $20,000,000 of first mortgage bonds.
Pro¬
ceeds—For construction program.
Underwriter—To be
determined by competitive bidding. Probable bidders:
Halsey Stuart & Co. Inc.; The First Boston Corp. and
Blyth & Co., Inc. (jointly); Equitable Securities Corp.;
White, Weld & Co. and Shields & Co. (jointly); Kuhn,
Loeb & Co., Salomon Bros. & Hutzler and Eastman Dil¬
lon, Union Securities & Co. (jointly); Lehman Brothers
and Bear Stearns & Co. (jointly). Bids—Expected to be
received

on

Jan. 6.

able bidders:

Halsey, Stuart & Co. Inc.;

White, Weld &

ler; Eastman Dillon, Union Securities & Co., and
able Securities Corp. (jointly).
Bids—Expected
received
M.

&

on

Jan. 19.

S.

Oils Ltd.

May 11 filed 390,000 shares of common stock.
cents per share.
Proceeds — For exploration,

Equit¬
to be

Price—60
develop¬

acquisitions. Office—5 Cobbold Block, Saska¬
toon, Saskatchewan, Canada.
Underwriter —Cumber¬
land Securities Ltd., Regina, Saskatchewan, Canada.

ment and

Continued

on

page

42

42

(2438)

The Commercial and Financial Chronicle

Continued from page 41

i•

'

Magna-Bond, Inc.
Nov. 9 (letter of
notification) 150,000 shares of
stock
For

(par 10 cents).

Price—$2

share.

per

general

corporate purposes.
Business
Office—1718 S. 6th
Street,

coatings.
derwriter—American
Connecticut

•

common

stock,

$1, with

par

to purchase

warrant

one

common

entitling the registered holder

funds

corporate

of

the

company and
Office—20 S. E.

purposes.

Fla.

Underwriter—Blair
—Expected this Fall.

& Co.

used

for

Oct.

common and one

Mortgage will
will

Mid-America Minerals, Inc.
Nov. 16 filed 400,000 shares of
class A common stock
(par $1).
Price—$5 per share.
Proceeds—For general
corporate purposes, including the reduction
of indebted¬
ness, acquisition of properties, and
additional working
capital. Office—500 Mid-America Bank
Building, Okla¬
homa City, Okla.
Underwriter—None.
Middlesex Water Co.
Oct.

30

fered

filed

29,534 shares of
holders of the

to

stock, to be of¬
outstanding preferred and/or

stock of record Dec. 2
for each three
preferred

common

share

held,

with

share.
for

common

14

a

Proceeds

day

-

—

To

for

J.

the basis

or

common

standby.
repay

construction purposes, with
general corporate purposes.

Woodbridge, N.

on

Price

—

loans

the

balance
—

one

shares

bank

Office

of

$16.75

then
per

incurred
to

52

be

Main

Underwriter—Kidder, Peabody

Inc., New York.

new

used

St.,

& Co.,

Midwestern Financial Corp.
(12/14-18)
9 filed
250,000 shares of common stock (par
$1).
Price—To be supplied by
amendment.
Proceeds—To
pay the $1,360,000
balance to Majestic
Mortgage Co. due
in connection with the
issuing company's acquisition of
*all of the
outstanding stock of Majestic Savings & Loan
Association, with about $650,000 to be used for
capital
contributions to its savings and loan
associations and for
Nov.

loans to other

subsidiaries, $51,000 to be used to repay
principal and interest on a short-term bank
loan, and
$55,000 to be used as additional
working capital. Office
—2015 13th
Street, Boulder, Colo. Underwriters—W.
R.
Staats & Co., Los
Angeles, Calif., and Boettcher & Co.
and
Bosworth, Sullivan & Co., Inc., both of
Denver, Colo.
Minitran Corp.
(12/17)
Oct.

30

mon
—

(letter

stock

For

(par

general

of

notification)

one

cent).

corporate

150,000 shares of com¬
Price—$2 per share. Proceeds
purposes.

Office

Street, Newark 2, N. J.

—

5

Oliver

Business—Makes transformers.
Underwriter—Pleasant Securities Co., 392 Broad
Street,
Newark, N. J.
★ Minnesota
Nov.
and

$18;

27

filed

Valley Natural Gas Co.
15,800 shares of common stock

865 additional shares.
for the 865

shares, which will be sold to
directors
and employees of the
issuing company, $17 per share.
Proceeds—For construction.
Office—1750 Hennepin
Ave.,
Minneapolis, Minn. Underwriters
Woodard-Elwood &
Co., and J. M. Dain & Co.,
Inc., both of
—

Minneapolis, and
Harold E. Wood & Co., of St.
Paul, Minn.
ic Mighty Mover Corp.
Dec.

(par
For

10

filed

1,000,000 shares of class
cents). Price
25 cents

10

—

liabilities, advertising,

—1701

E.

—None.

per

A

common

share.

stock

Proceeds—

and

working capital. Office
Louisiana Ave., Denver
10, Colo. Underwriter

Mohawk Airlines Inc.
Nov.

9

filed

$3,500,000 of 6% convertible
debentures, due 1,974, $1,917,500 of which subordinated
are to be of¬
fered in
exchange for a like amount of

outstanding 5Vz%
due

1966.

The

exchange offer,
be supplied
by
corporate

the company's
subordinated
debentures,
plus any not taken in the

convertible

remainder,
are

to

be

publicly offered.

amendment.

purposes,

Proceeds

including debenture




—

—For

the

Price.—To
For

general

redemption, air¬

of

June

16

sisting

of

warrant

stock

for

each

amount.

$500

Price—To

share.

units,

share

of

common

entitling the holder

to

stock

purchase

with

Campeau Co., Inc., Detroit, Mich.
On Oct. 29 the
was
accepted for filing with the
Michigan Corpo¬
ration and Securities
Commission.
Homes Corp.

Nov. 25 filed warrants for
the purchase of
60,100 shares
of class B common
stock (par $.50).
Price—To be sup¬
plied by amendment.
Office—Earl Avenue & Wallace

Lafayette, Ind.

New York City.

Underwriter—White,

Weld

&

Co.,

Industrial

Aug. 4
(no par).
Price
retire indebt¬
edness for construction of
plant and for other liabilities,
and the remainder
will be used for

Saskatchewan,
Ltd..

Regina.

Video Corp.

operating capital
Canada. Underwriter-

Saskatchewan,

Canada

(12/14-18)

283,307 shares

of

class A stock
(par $1).
Each certificate for
class A shares will
bear an endorse¬
ment
evidencing an interest in a Trust which

outstanding'

will

common

hold'

stock of Rico

Electronics,
Puerto Rican
manufacturing company affiliated
with National Video
Corp.
Price
To Be
supplied
by
amendment. Proceeds—Tc
selling stockholders. OfficeChicago, 111.
Underwriter
Bache &
Co., New York.
• Nevada Broadcasters'
Fund, Inc.
Nov. 25 (letter of
notification) 264.671
Inc.,

a

—

stock.

shares

of

Price—At par

For expenses
necessary

station.

com¬

($1
per share).
Proceeds—
to operate a radio and
televis'on

Address—P. O. Box
2586, Las Vegas, Nev.

derwriter—None.

Un¬

North Carolina
Telephone Co.
Sept. 4 filed 576,405 shares of
common capital
stock, u
be offered for
subscription bv holders of
outstanding
stock in the ratio of
two new shares for
each five share*
held. Price—$2
per share.
Proceeds—To reduce indebt¬
edness with the
balance, if any, to be used as
working
capital.

Office—Matthews,

more
security
subscribed for

dealers
at

N.

C.

will be
$2 per share.

Underwriter—One

offered

any

shares

of

Inc,
(letter of

corporate

—

Corp., Detroit, Mich.

27

Fasteners

Corp.

filed

50

equip¬

machinery and working capital. Office—640 E.
61st Street, Los
Angeles, Calif. Underwriter
Holton,
Henderson & Co., Los
Angeles.
—

Pacific
Oct.

20

Uranium Mines Co.

filed

$3,000,000

common

stock

purchase

common

stock.

rants

to

are

of

6%

secured

notes,

675.000

warrants, and 675.000 shares of
$1,600,000 of the notes and 360,000 war¬

be

offered

standing notes.

to

holders

of

$1,600,000 of out¬

The

rities Corp., acting

on behalf of their
clients, for a total
of $1,344,000 for the
notes and $56,00Q for the war¬
rants.
•

Palomar Mortgage Co.
13 filed
$750,000 of

(12/14)
15-year 7% subordinated sink¬
ing fund debentures, due
1974, with common stock war¬
rants
attached, and 80,000 shares of common stock ($1
par), to be offered in units of $1,000
principal amount
of debentures with a
warrant entitling the holder to buy
100 shares of
common before
11/30/62. Prices—To be
supplied by amendment.
Proceeds —To be loaned to

home
with

builders
real

individual

borrowers

Office—4026 30th
Underwriter—J. A. Hogle &

Utah.

Rathe

Sept.

and

estate.

News, Inc.
400,000 shares

17 filed

cents)

with

warrants

to

of

(no par).

production,

San

Diego,

Co., Salt Lake City,

stock

common

purchase

connection

in

Street,

(par

10

additional

100,000
shares at $3.25 per share. Price
$3.75 per
share, with warrants. Proceeds—For
general corporate
purposes, including the addition of
working capital, the
reduction
of
indebtedness, and the provision of the
$173,000 cash required upon the exercise of
an option to
purchase the building at
245-249 W. 55th St., New York.
Office—245 W. 55th
Street, New York. Underwriteran

common

—

Hilton
ris

Securities, Inc., formerly Chauncey, Walden, Har¬

&

about

Freed,

30

Perrine
Oct.

26

nated

Inc.,

New

York.

Industries,

filed

$500 and $1,000.
to establish two

industrial

Inc.

(12/15)
20-year convertible subordi¬
1979, to be offered in units of

$1,500,000

debentures

in

Offering—Expected

days.

of

due.

Price—At

par.
Proceeds—To be used
plants in the midwest and southeast
to spend $350,000 to equip these new

new

areas;

plants; $150,000 to further
equip and improve the com¬
pany's Brooklyn plant; and
$600,000 will be used to re¬
tire

&

corporate indebtedness.
Co.; New York.

Underwriter—S

D.

Fuller

Petroleum Projects
Oct.

13

filed

exploratory
will

cost

Mineral

$1,500,000
fund.

$10,000.

Price

of
—

participations in oil and
The

minimum

Office—Madison,

N.

J.

gas

participation

Umierwriter—

Projects Co.. Ltd

Pilgrim National Life Insurance
Sept. 17 fHed 100,000 shares of

Co.

common

notification) 120,000 shares of common
Price—$2 per share. Proceeds—For de¬
velopment, purchase, parts for
stock

per

noi

,

Nova-Tech,
Nov. 4

J

common

ment and

—

mon

^
of

filed

—

filed

shares

150,000 shares of capital stock
(par
cents). Price—$2 per share.
Proceeds—For new

—

19

an

23

4c Pacific

Calif.

Minerals Ltd.
filed 150.000 shares of
common stock
$1 per share.
Proceeds
To

Oct.

purchase

23.

27

Nov.

Nov.

F.

Rumball

to

remaining $1,400,000 of new notes
and 315,000 warrants
are to be offered to
American Secu¬

issue

&

and

York.

R.

National

common.

Proceeds—For

150,000 shares of common. stock (par one
Price—$6 per share. Proceeds—For research and
working capital. Underwriter—Sutro Bros. &
Co., New

sum

•

amendment.

cent).

also

150,000 shares of class A
stock. Price—At par
($2 per share). Proceeds—
For new equipment,
inventory ana working capital AO
iress—P
O
Box 1658. Lakeland.
Fla
rnderwriter

Laird

by

development,

260,000

Price—$2

Ovitron

common

Regina,

supplied

filed

general

Oct,

con¬

Citrus Corp.
April 20 (letter of notification)

—

outstanding

be

purposes. Office
865 Prospect
Ave., Newark, N. J. Underwriter.—Laird, Bissell
& Meeds,
New York, N. Y.

attached

National

Office

a

ic Old Empire, Inc.
(letter of notification) 240,000 shares of
common
(par 10 cents). Price—$1.25
per share. Proceeds—

additional

one

and additional

:

re-

Nov. 30

10

Indefinitely postponed.

National

2

to Dec.

—

St.,

The

stock (par 35
share.
Proceeds—To retire bank
loans and for investment
purposes.
Office—513 Interna¬
tional Trade Mart, New
Orleans, La. Underwriter
Assets Investment Co.,
Inc., New Orleans, La. The SEC
"stop order'' hearing has been
postponed from. Nov.

of

includes an additional 10,000
of common stock reserved
for issuance to
ke>
employees pursuant to options. Price—To be
supplied
by amendment. Proceeds
To be used to retire bank
loans. Underwriter—Milton D.
Blauner & Co., Inc., New

National

be offered to

to

Oil, Gas & Minerals, Inc.
April

cents

shares

•

are

shares held.

interest in Parker Petroleum Co.

Corp.

The statement

York.

at the

10

Office—8255 Beverly
Boulevard, Los Angeles,' Calif., Underwriter—None.

of

(par

V

Appelbaum at $.10 per
share in *

share for each

new

drilling, exploration,

Proceeds

50,000 shares of common stock
50,000 warrants to be offered in

one

L.

■<

are

—

filed

and

unaccounted, for

>

<

group of individ¬
uals, not as yet named, who hav.e; agreed to
purchase not
less than 307,925 shares, and will also
be offered
shares :
not bought by the holders of the

For

such

funds

Microwave

cents)

will

John

to

mainihg shares

the company.
Office—c/o
Raymond F. Wcntworth, 6 Milk
St., Dover, N. H.
Un¬
derwriter—Eastern Investment
Corp., Manchester, N. H.

Narda

1

nothing best efforts" basis
receive $15,000 for
expenses

stock

shares

general

St

Burn-

or

*

Infante, Inc.,

debentures converted. Price—At face

all of the

($10 par),
Prices—For the 15,800
shares,

100

sold

rate of one

as

$300,000 of 61/2% convert¬
debentures, series A, due Oct. 1, 1969.
Debentures are convertible at
any time through Oct. 1,
1968 into class A
non-voting common stock (par $5) at
of

B.

stock (par 20 i
dents), 307,927 shares of which are to be offered
for subscription by holders of outstanding common
stock

Mutual Credit Corp.
(letter of notification)
ible subordinated

rate

South

Occidental Petroleum
Corp.
29 filed 615,854 shares of
common

Oct. 6

the

—

Oct.

(letter of notification) 50,000 shares of common
stock (par 10
cents). Price—$6 per share. Proceeds—
For general
corporate purposes. Office—Beech
Street,
Islip, N. Y. Underwriter—-Heft, Kahn &

Hempstead, N. Y.

"all

on an

underwriter

be

to

Manufacturing Corp.

9

Co., Inc.,

inven-

Unice

Underwriter—Mortimer

consideration of certain services
rendered.

share of Guaranty common. Proceeds—
its proceeds fo
rexpansion; Guaranty

Munston Electronic

mumers.

axxKX

a

Avenue, Silver

underwriter

no

gcois

$.75 per share selling commission on the
200,000 shares
comprising the public offering, and the
privilege of purchasing 37,500 shares of the common stock
at $.10
per
share.
The 37,500 shares, thus far

use

its

use

Nov.

filed

per

The

waukee, Wis.

(12/14-18)

Price—$275

side &

proceeds for additional working capital.
Office—(of both firms) 606 West Wisconsin
Ave., Mil¬

Micronaire Electro Medical Products
Corp.

warrants.

v/jl

repurchase of notes under its repur¬
Office—11236 Georgia

Underwriter—There is

are

Rochester, Michigan.

a

$1), be¬

Proceeds—For general corporate
purposes, includ¬
ing the discharge of
indebtedness, the expansion of
sales efforts, and for
working capital. Office—79 Madison
Avenue, New York City. Underwriter—General
Invest¬
ing Corp., New York.

200,000

Mortgage Guaranty Insurance Corp.
Sept. 23 filed 40,000 shares of common stock
(par $10) in
joint registration with Guaranty Insurance
Agency,
Inc^ which filed 10,000 shares of its own common stock
(par $5). Price—$115 per unit of four shares of
Mortgage

Ave., Miami,
Inc., New York. Offering

Underwriter—None.

unit.

for

reserve

common

stock, of which
to be publicly offered.
Price—$3.75 per share J
Proceeds—To reduce indebtedness and
increase

1969, and 30,000 outstanding
(par 40 cents). Price—For the

such, but Adrienne Investment Corp., an affiliate of the
issuing company, will act as sales agent, for which it
will receive a selling commission of
7%.

the

200,000 shares of common stock
(par 10
cents) and 50,000 one-year warrants for the
purchase of
sutfi stock at $3 per
share, to be offered in units of 100
shares of common stock and 25

a

Corp.

Nov. 30 filed 275,000 shares of

con¬

filed

Spring, Md.

new

16

16

tain

Mayfair Markets

Oct.

due

stock

common

chase agreements.

general

basis of one
share for each five shares
held Nov. 13.
Rights are
scheduled to expire in
February. Price—$10 per share.
Proceeds—For general corporate
purposes, including ex¬
pansion and working capital.
Office—4383 Bandini
Blvd.,
Los Angeles, Calif.

debentures,

capital.

Nu-Era

Corp.
(12/14)
10-year subordinated

Thursday, December 10, 1959

Office—1721 Sepulveda
Blvd., Man
Calif.
Underwriter—Holton, Henderson &
Co., Los Angeles, Calif.

Machine

$600,000 of 6%

..

hattan Beach,

$3,000,000 of second mortgage notes and
accompanying repurchase agreements, to be offered in
$3,000 units. Price—From $2,000 to $4,000 per unit. Pro¬
ceeds—To purchase other second trust notes
and to main¬

3rd

Oct. 1 filed 301,177 shares of
common stock
(par
ing offered to holders of such stock on
the

working

Office—Utica,

Montgomery Mortgage Investment Corp.

share of

added to

general

capital.

debentures, 100% of principal amount; for the common
stock, at a price to be related to the market. Proceeds1—
To liquidate indebtedness in the
amount of $150,000,
with the remainder to
purchase new equipment and ma¬
chinery and be used as working capital.
Office — 944
Halsey Street, Brooklyn, N. Y. Underwriter—Myron A,
Lomasney & Co., New York.

such common stock at an
initial
price of $11 per share. Price—For
preferred, at par; and
for class A, $10.10
per share.
Proceeds—$291,099 is to
be expended during the
period ending Aug. 31, 1960 for
mortgage payments and releases; $465,000 will be
paid
on notes acquired
by members of the Magnuson
family
in the transfers of
subsidiaries and properties to the
company; $106,000 will be used to close certain
options
and purchase contracts
covering lands in the MelbourneCape Canaveral area; the balance will be
one

working

Business

filed

shares of

common

stock purchase warrants. Each share of
class A
stock carries

29

vertible

lative convertible preferred
stock, par $10), and 150,000
A

and

Offering—Expected middle of January.

Mohawk

Oct.

Protective

Avenue, N. W., Washington 6, D. C.
Magnuson Properties, Inc.
June 29 filed 500,000 shares of
class A common stock
(amended on Aug. 24 to 150,000 shares of 6Ms% cumu¬
shares of class

Lnuerwruer—jjempsey-Tegeier & Co., £>t. Louis,

Y.

common

Camden, N. J. Un¬
Securities, Inc., 1028

Diversified

equipment,

N.

Mo.

Proceeds—

—

plane

.

of

which

holders of

55,000 shares
record

are

to

be

offered

of

America

stock
first

(par $1)>
stock¬

to

Aug. 31, 1959, and 45,000 shares (mini¬
mum) are to be offered to the
public, which will also be
offered any shares
unsubscribed for by said stockholders.

Volume

190

Number

5906

share. Proceeds

.

.

.

The Commercial unci

price—-$5

per

purposes,

possibly including the enabling of the issuing

For general corporate

—

to make application for licenses to conduct its
insurance business in States other than Illinois, the sole
State in which it is presently licensed. Office—222 W
Adams Street, Chicago, 111.
Underwriter—None. State¬
ment effective Nov.4.
company

^ Pioneer Finance Co.
7 filed 65,000 shares of convertible preferred stock

Pec.

(par

$25), to be offered to holders of the outstanding
the basis of

common-on

one

preferred share lor each la

shares held. Price—To be supplied by amend¬
ment. Proceeds-—For general corporate purposes. Office
common

—1400 First. National Bank

Bldg., Detroit, Mich. Under¬
writers—White, Weld & Co., Inc., New York City, and
Watting, Lerchen & Co., Detroit.
• L.

F.

Popell Co.,

Inc.

Nov.

27

filed

shares

100,000

of

stock

common

(par

10

cents). Price—$3 per share. Proceeds—To reduce current
liabilities and for working capital. Office—2501 N. W.

Miami, Fla.

75th St.,

Underwriter—None.

Prudential Commercial

Corp.
(letter of notification) 150,000 shares of common
stock (par one cent): Price—$2 per share.
Proceeds—
For general corporate purposes.
Office—City of Dover,
County of Kent, Del. Underwriter—All State Securities.
Inc., 80 Wall Street, New York, N. Y.
Oct. 21

Public

Service

Electric

Nov, 25 filed <300,000 shares
Price—To be supplied

Gas

&

of

Co.

common

by amendment.

(12/15)

Financial

Chronicle

Russeks

Fifth

Avenue, Inc.
480,100 shares of common stock (par $.50),
which may be offered for sale
pursuant to the merger,
scheduled for Dec. 22, of Russeks and Oregon Veneer
Co.,
by the several present holders of Oregon stock. Office—
909 Diversey
Parkway, Chicago, III.
Nov. 30 filed

Save-Mor
Nov. 15

Drugs, Inc.

(letter of notification) 100,000 shares of

stock (par 10 cents).

working

•

Price—$2

per

share.

common

Proceeds—For

capital.

Office—22 M St., N. E., Washington,
Underwriter—E. A. Burka, Inc., Washington, D. C.

D. C.

Scaico Controls, Inc.

Sept.

23

(leter of

notification) 240,000
(par 10 cents). Price—$1.25

shares of com¬
per share. Pro¬
development; increaese of plant
facilities; sales and training program; sales promotion
and for general corporate purposes. Office—P. O. Box
41, 450 Cooper St., Delanco, N. J. Underwriter—Albion
Securities Co., Inc., 11 Broadway, New York 4, N. Y
Offering—Expected any day.
*
stock

mon

ceeds—For research and

.

★ Scotts Hill Rehabilitation Center, Inc.
Nov. 30 (letter of notification) 58 units, each unit
sisting of four $1,000 debentures, redeemable at

con¬

the
bearing 10% annual interest, 10
shares of preferred stock, ($100 par), and 10 shares of
common
stock, ($10 par). Price—$5,100 per unit. Pro¬
ceeds—For new hospital building and equipment. Office
—705 Knickerbocker Bldg., Baltimore 2, Md.
Under¬
end

10

of

and

years

writer—None.

•fr Security (Mortgages, Inc.

added to the general funds of the company and will be
used for general corporate purposes, including the pay¬

Nov.

ment before maturity of unsecured short-term bank loans

cents), to be offered in units of 1 debenture and 25 com¬
mon
shares. Price—$100 per unit. Proceeds—To invest
in equities and/or mortgages. Office — Denver 2, Colo.

to

be

presently incurred in

pany's

connection with

the

com¬

construction

program. Office—80 Park
Underwriter — Merrill Lynch,
Pierce, Fenner & Smith Inc., New York.

current

Place, Newark

Puerto

Rico

filed

15

Oct.

1, N, J:

Industries, Inc.

shares

48,500

of

class

A

common

stock,

(par $1), 200,000 shares of class B common stock (par $1)
and

subordinated debentures, due July
With the exception of 151,500 shares of class B
allocated to the organizers of the company at

$388,000 of 6%

1, 1971.
common

filed

30

nations

of

$500 and $1,000 each. Price—At par. Proceeds
machinery and other equipment from the
company's present plants at Chicago and Beulah to the
company's proposed plant at Traverse City, Mich. Office
fnove

—1701-1709
None.

B shares.

Price—$5,000 per unit. Proceeds—For invest¬
securities of its subsidiary, Puerto Rico
Meat Packing" Co., Inc., which will use the funds, esti¬
mated at $600,000, as operating capital.
Address—P. O
Box No. 622, Little Rock, Ark. Underwriter—None.

13th Street,

Chicago, 111.

Underwriter—

Shield Chemical Ltd.

the

in

W.

Sept.

(letter of

8

95,000

shares of capital

stock

Dec.
to

Colorado.

4 filed- certificates of interest evidencing options
purchase 27,000 shares of class A common stock, to¬
gether with -underlying class A shares. Office — Mel¬

bourne, Fla.
•

—

Realty Investment Associates, Inc.
30 (letter of notification) 3,000 shares of capital
stock with a minimum subscription of 50 shares and a
maximum of 500 shares. Price—At par ($100 per share).
Proceeds—For working capital. Office—1104 N.
Main
St.. Randolph, Mass. Underwriter—None.
Oct.

Red

Fish

Boat

Co.

(12/17)

Price—75 cents per share.
Proceeds—To pay mortgages, accounts payable, purchase
raw
materials, expand production facilities and expan¬
sion of sales program.
Business—Manufactures fiber¬
(par 10 cents).

Address—P.

O.

Box

610

Clarksville, Texas.

Underwriter—R. A, Holman & Co., Inc., New York, N. Y.
Renewal Guaranty Corp.
Oct. 28

(letter of notification) 100,000 shares of common
stock (par $1). Price—$3 per share. Proceeds—For work¬
ing capital.
Office—First National Bank Bldg., Suite
2323, Denver 2, Colo. Underwriter—Columbine Securi¬
ties Corp., Denver, Colo.
'
Reserve Insurance Co., Chicago, III.
20 filed 110,837 shares of capital stock,

Oct.

62,676
161

to be sold for the

are

shares

are

to

sold

be

for

Price—To

ment.

be

Proceeds—To

of which

company's account and 48,-

selling stockholders.

added

of

which

die

800:

longer underwriting this issue.

Co., New York. Offering—Indefinite.

—Bear, Stearns &

offered

on

stock. These debentures are to be

common

the

capital deben¬
100,-

1975, with warrants to purchase

tures, due Jan. 1,
000 shares of

Underwriter

basis

bentures, each such

of $1,000 principal amount of de¬
debenture bearing warrants for the

stock at $4.25 per
share.
Price—To be supplied by amendment.
Proceeds
—For general corporate purposes. Office — Charlotte,
N. C. Underwriters—Interstate Securities Corp., Char¬
purchase

of

200

shares

&

Co.,

Greenwood.

Southern Growth
Nov.

filed

12

Price—$5
—

121

Asheville,

S.

C.

N.

C.,

and

Citizens

S

Chauncey,

Price—$5 per
opening new

product engineering and promotion, and working capital.
Office—3550 N. W. 49th St., Miami, Fla.
Charles Plohn & Co., New York City.

• Standard
Beryllium Corp.
Sept. 3 (letter of notification) 200,000 shares of common
stock (par one cent).
Price—$1.50 per share. Proceeds

—For working capital and general corporate purposes.
Office—150 E. 43rd St., New York 17, N. Y. Underwriter
—Haas Raymond & Co., 120 Liberty Street, New York.

Offering—Expected

filed

Dec.

filed

8

200,000 shares ol

common

stock, of which

issuing

125,000 are to be offered for the account of
S. P. Mugar, President, and 25,000 are to be offered by
Mugar to certain officers and employees of the company
and its subsidiaries.
Price—To be supplied by amend¬
ment.
Proceeds—For general corporate purposes, in¬
cluding construction. Office—297 Walnut Street, Newton,
Mass. Underwriter
Hemphill. Noyes & Co., New York
company,

—

City.
State

Industries

Oct. 5 filed $500,000 of 6%

convertible subordinated de¬

a modern paint
plant, and the purchase and installation of new tube mill
equipment. Office—4019 Medford St., Los Angeles, Calif.
Underwriter—John Keenan & Co., Inc., Los Angeles.

cluding the purchase and installation of

Stelling Development Corp.
(letter of notification) 300,000 shares of common
stock
(par one cent). Price—$1 per share. Proceeds—
For mortgages, land, paving roads, loans payable, adver¬
tising, etc. Office—305 Morgan St., Tampa 2, Fla. Under¬
writer—Stanford Corp., Washington, D. C.

Price—$8.75

Industries, Inc.

Street,

basis, with

a

Finishing

Co.,

Inc.

Nov. 30

(letter of notification) 10,000 shares of common
stock (no par).
Price — $10 per share. Proceeds — For
working capital. Address — Thomaston, Conn. Under¬
writer—None.
•

Manufacturing & Instrument Corp.
(letter of notification) 80,000 shares of common
stock (par 50 cents).
Price—$3 per share. Proceeds—
For general corporate purposes. Office—154-01 Barclay
Ave., Flushing 55, N. Y. Business—Electronics. Under¬
writer—D. A. Lomasney & Co., New York, N. Y.
Offer¬
ing—Expected today (Thursday).
Superior

Oct.

12

Supermarket Service, Inc.
14 (letter of notification) 9,000 shares of common
(no par). Price—$11.50 per share. Proceeds—For
working capital. Office — 103 E. Main St., Plainville,
Conn. Underwriter
E. T. Andrews & Co., Hartford,

Oct.

stock

—

Conn.
Telechrome

Manufacturing

Corp.

convertible subordinated
debentures, due 1969.
Price — At 100% of principal
amount.
Proceeds—For general corporate purposes in¬
cluding expansion and debt reduction.
Office—Amityville, L. I., N. Y. Underwriters—Amos Treat & Co., Inc.,
Nov.

16

filed

$750,000

of

6%,

and

Truman, Wasserman & Co., Inc., both of
City. Offering—Expected in January, 1960.
Texas

National

New York

Petroleum Co.

Nov. -27 filed

$6,500,000 of 61/2% sinking fund subordin¬
ated debentures, due Jan. 1, 1975, and warrants for the
purchase of 650,000 shares of common stock ($1 par).
These securities are to be offered in units of one $500
debenture and
of

common

a

stock.

warrant

for

the purchase of

50 shares

Price—To be supplied by amendment.

Proceeds—To discharge bank indebtedness;

to pay Utah

Co. $19,200,000 for various properties; and
general corporate purposes. Office—902 South Coast
Bldg., Houston, Texas. Underwriters — Dean Witter &
Co., San Francisco, Calif., and Cruttenden, Podesta &
Co., Chicago, 111.
Southern Oil

for

Telepiompter Corp.
27 filed 125,000 shares of common stock

($1 par).
amendment. Proceeds—$690,000 to supply the cash portion of proposed acquisitions;
$150,000 to reimburse Teleprompter's treasury for the
purchase of Antennavision of Silver City, Jnc., a New
Mexico corporation; $100,000 to prepay in full a bank
note due Dec. 31, 1960. Office—311 W. 43rd Street, New
York City. Underwriter—Bear, Stearns & Co., New York

Price—To be supplied by

stock

(par $1).

Proceeds—For investment. Office
C.
Underwriter — Capital
Securities

Main

it Stephenson Finance Co., Inc.
22,095 shares of common stock (par $2.50).
per share. Proceeds—For working capital.
Office—215 South Dargan St., Florence, S. C.
Under¬
writer—R. S. Dickson & Co., Inc., Charlotte, N. C.

Nov. 27 filed

Greenville, So. Car., on a
commission of 50 cents per

Oil

Ventures, Inc.

Timeplan Finance Corp.
8 (letter of notification) 28,570 shares of cumular
preferred stock (par $5) and 14,285 shares of com¬
stock (par 10 cents) to be offered in units of one
share of preferred and one-half share of common. Price
—$10.50 per unit. Proceeds-^For working capital. Office
—111
E. Main St., Morristown, Tenn.
Underwriter—
Texas National Corp., San Antonio, Tex.

Oct.

Price—$5,000 per unit,
Proceeds—For
exploration. Office — 2802 Lexington, Houston, Texas.
Underwriter—The participations will be offered by of¬
ficers of the company and by certain investment firms.

tive

27

Gas

Exploration

Program.

minimum participation of $10,000.

Southwestern
2

day.

50,000 are to be offered for the account of the

$2,000,000 of participations in its 1960 Oil

Nov.

any

ir Star Market Co.

City.

Southland

a

UnderwriterOffering—Ex¬

pected in January.

Nov.

-

share.

So.

efforts"

"best

common

963,000 shares of common

per

Greenville.

Corp.,

of

share.

Waladdress, states that it
as

Miami. Fla.

(par $1)

quiring technical equipment and machinery, and adding
to
working capital.
Office — 659 10th Avem e. New
York.
Underwriter—Hilton
Securities, Inc.," 580 Fifth
York, formerly known

First Street,

East

McCarley

Poses, including moving to new quarters and installing
executive offices and sound studio facilities therein, ac¬




South

working

Co..

Inc.

same

to

it Southeastern Factors Corp.
Dec. 9 filed $500,000 of 6% subordinated

•

the

add

lotte.

Aug. 27 filed 330,000 shares of common stock (one cent),
of which
300,000 shares are to be publicly offered. Price
—83.50 per share. Proceeds—-For general corporate pur-

at

the

loan of $6,400,capital; to retire certain longindebtedness: and to develop citrus groves.
Office

—250

with

& Freed

in

bank subsidiaries; to repay a bank

to

term

Advisor—Revere Advisory, Inc.

no

at the date of the stock offering; to
capital stocks of six of the company's

outstanding

invest
seven

Trust

of

per

Records.

1,543,000 shares are to be issued and sold for
of the company, and 457,000 shares, repre¬

outstanding stock, to be sold for the accounts
of certain selling stockholders. Price—To be supplied by
amendment.
Proceeds—To retire 70% of the common

and

Avenue, New

stock, of

senting

Nov.

Roulette

common

account

share. Proceeds — For investment.
Underwriter—Revere Management Co., Inc. Investment$13.50

A

Stottile, Inc. (Formerly South Dade Farms, Inc.)
July 29 filed 2,000,000 shares of common stock (par $1),

certain

account

Revere Fund, Inc., Philadelphia, Pa.
Nov. 10 filed 250,000 shares of capital stock

den, Harris

'

'

100,000 shares are to be offered by the issuing
company and 297,192 shares are to be offered by the
present holders thereof. Price — To be supplied by
amendment.
Proceeds—For general corporate purposes.
Office—336 South Spring St., Port Washington, Wiscon¬
sin.
Underwriter—A. C. Allyn & Co., Inc., Chicago, 111.

the

to enable it to finance a larger volume of
underwriting and to expand its area of operations. Un¬
derwriter—A. G. Becker & Co. Inc., Chicago, 111.
This
offering will not be made in New York State. Offering
—Postponed indefinitely.

—

M

'

•

supplied by amend¬
general funds ol

the

be
to

the.company

Price

.

Simplicity Manufacturing Co.

stock

(letter of notification) 400,000 shares of class A

common stock

glass boats.

\>

>-l.

i

'

which

July 8 filed 300,000 shares of common stock (par 25f>
Price
$1.50 per share. Proceeds —For general corpo¬
rate purposes.
Office—1202 Myrtle St.. Erie. Pa
Under
writer—John G. Cravin & Co., New York.
Offering-—
Expected any day.

•

I

Nov. 30 filed 397,192 shares of class

Radr-O-Lite, Inc.

Oct. 22

To

Inc.

Fluorescent Manufacturing Co.
140,000 shares of common stock (par $.10),
share. Proceeds—For plant improvements,
muffler and brake shops, advertising, new

27 filed

• Summit

notification)

(par 10 cents). Price—$1.50 per share. Proceeds—
purchase and install manufacturing equipment; con¬
trol and test equipment; advertising and for working
capital. Office—17 Jutland Road, Toronto, Canada. Un¬
derwriter—Peters, Writer & Christensen, Inc., Denver,

• Radiation,

Sta-Brite

June 8

* Setwell Co.
Nov. 19
(letter of notification), $50,000 of 6% 10-year
registered subordinated notes to be offered in denomi¬

of

ment

(par 15

Underwriter—None.

par,

the securities are to be offered to the public in units
$4,000 of debentures, 500 class A shares, and 500 class

$250,000 of 11-year sinking fund deben¬

tures and 62,500 shares of class A common stock

—To

•

Nov.

bentures, due Oct. 1, 1974. Price—At 100% of principal
amount. Proceeds—For general corporate purposes, in¬

stock

(no par)
Proceeds—To be

43

(2439)

filed

Investment Co.

225.000

shares of

common

stock, of which

15,000 shares are to be offered to employees of the issu¬
ing company and its subsidiaries, and 210,000 shares

represent outstanding stock held by previous stockhold¬
ers
of Southwest Acceptance Co., who may offer their
shares. Price—At market. Office—Amarillo, Texas. Un¬
derwriter—None.

mon

Tobin Craft,
Nov.

stock

17

Inc.

(12/16)

shares oi common
Price—$2 per share. Proceeds—For

(letter of notification) 75,000

(par 10 cents).

general corporate purposes.
Address—Bayvilie,
County, N. J.
Underwriter—General Investing
New York, N. Y.
,

Ocean
Corp.,
..

Continued on page 4%

44

The Commercial and Financial Chronicle

(2440)

Continued from page 43

writer—None.

Myrl

McKee

L.

Portland,

of

Ore.,

Tower's Marts, Inc.
Aug. 28 filed 300,000 shares

(par 10 cents).

class

of

stock

common

Price—$3

per share.
Proceeds—To re¬
by about $300,000, with the balance
working capital of the company and its
subsidiaries.
Office—210 East Main Street, Rockville,
Conn. Underwriters—To be
supplied by amendment.

duce

indebtedness

to be added

to

Transamerica Corp.
Nov. 9 filed 832,000 shares of
capital stock (par $2), to
be offered in
exchange for the capital stock

(par $6.25)

of

American Surety Co. of N.
Y., on the basis
shares of Transamerica for three shares of

of

two

Surety. The
conditional upon holders of 51% of the
Surety
accepting the exchange. Office—Montgomery St.
Columbus Ave., San
Francisco, Calif.

offer

is

Stock
at

Transcon Petroleum

f

&

Development Corp.,

Mangum, Okla.

Marine, Inc. (12/14-18)
Oct. 23 filed $1,250,000 or 6% sinking fund debentures,
due Dec. 1, 1974, with warrants to purchase 100 common
shares for each $1,000 of debentures, and 125,000 shares
of common stock (par $1), to be offered in units of 100
common shares and $1,000 of such debentures.
Price—
$1,125 per unit. Proceeds—For the acquisition of Rich¬

(letter of notification) 300,000 shares of com¬
stock.
Price—At par ($1 per
snare). Proceeds—
For development of oil
properties. Underwriter—First
Investment Planning Co.,
Washington, D. C.
it Transit

Freeze

Corp.

-

.

..

,

Pec. 3 (letter of notification) 75,000 shares of common
(par 10 cents). Price—$4 per share. Proceeds—For

Stock

expenses incidental to the
development of a frozen food
trucking business. Office—152 W. 42nd
Street, New York
City. Underwriter
Jerome Robbins &
Co., 82 Wall
Street, on a "best efforts" basis. Offering—Expected in

Grand

a

and

•

Transitron

Hotel

Nov.

6

filed

be

Hall, to be constructed in the immediate vicinity
of Estes Park Chalet, located in Larimer
County, Colo.
Office —330 South 39th
Street, Boulder, Colo.
Under¬
writer—Mid-West Securities Corp., Littleton, Colo. State¬

subsidiary,
the

and

common

to

ance

Beverly
W. R.

be

stock

of

a

to

general

2

6001-4.

unpaid

subsidiary,

balance

with

funds.

the

Office

terests) to be offered in units.
Proceeds—For

for

bal¬

—

purposes

shares

of

8001

contracts
M

in

exchange for $20,000 cash the
filing not accounted for above.
shortly.
Gas

For

filed $5,500,000 of
participations in Programs
Price—$5,000 per unit. Proceeds—For acquisition

(letter of notification) 150,000 shares of common
(par one cent). Price—$2 per share. Proceeds—
corporate purposes.
Office
321V2 Grant

general

Victoreen
Nov.
due

13

cents). Price—$1.50

per

•

(The)
7

T

filed

mon

subordinated

of

com¬

they

Metal

&

are

this issue.

^

(i.

Nov.

stock

M.)

Tull

no

27
of common
(par $10) to be offered to
employees, officers, and
of the
company.
Price—$60 per share. Pro¬

directors

ceeds—For

construction of a warehouse.
Office—285
Marietta Street. N. W..
Atlanta. Ga. Underwriter—None.

Tungsten Mountain Mining Co.
May 21 (letter of notification) $100,000

principal amount
7% first mortgage convertible
bonds, to be offered
In denominations of $500 and $1,000 each.
Price—100%
of principal amount.
Proceeds—For construction, instal¬
lation of machinery and
equipment and working capital.
-Office—511 Securities
Building, Seattle 1, Wash. Under¬
writer—H. P. Pratt &
Co., Seattle 4, Wash.

.of
„

Turner

Timber Corp.
(12/14-18)
Nov. 12 filed
$2,000,000 of 6%% convertible
debentures,
due 1969, and
230,000 shares of common stock
(par one
.cent), to be offered in units
consisting of $1,000 principal
amount of debentures
and 125 shares of
stock. PriceSi,001.25 (plus accrued interest
from

12/15/59) per unit.
coal and timber prop¬
added to working
capital.
-Office
60 E. 42nd
Street, New York City. Underwriter
—Frank P. Hunt &
Co., Inc., Rochester, N. Y.
United Employees
Proceeds-—For the acquisition
erties, with any balance to be

.

of

insurance Co.
April 16 filed 2,000.000 shares
of common stock
(par $5)
Price
$10 per share. Proceeds
For acquisition of
.operating properties, real
and/or personal,
including
office furniture,
fixtures, equipment and office
space, bj
lease pr purchase.
Office
Wilmington, Del. Under¬
—

.

.a



—

a

of

program

national

distribution

retire

to the

560,000 shares

and

for

working
Under¬

cumulative preferred

stook, to be offered
stockholders of Ralph E. Mills
Co., Talbott Con¬

for all

Constructors, Inc., in exchange

the
outstanding capital stock of these three cor¬
porations, and to the owner of Sherman Concrete
Pipe
Co., Chattanooga, Tenn., for the
business and assets of
that company.
Office—Mountain Brook, Ala. Statement
became effective on
July 20.
Washington Water Power Co.

Nov.

24

(1/11-15)
mortgage bonds

filed

$10,000,000 of first
$5,000,000 of sinking fund debentures
To

be

supplied

notes due

the

by

amendment.

May 2, I960 in the

balance

for

1985.

Price-

Proceeds —To

amount

construction.

due

of

and

repay

$12,000,000, with

Underwriters— Kidder,
Inc., White, Weld & Co.

Peabody & Co., Blyth &
Co.,
and Dean Wilier &
Co., all of New York.
Wear-Weld

Engineering & Mfg.

Nov.

Co.

16 (letter of
notification)
debentures to be offered in

75,000 shares of
in

units of

mon

ing

one

stock.

capital

$150,000 of 7% 16-year
denominations of $250 and

common

stock

(no

$250 debenture

and

Price—$500
and

part

per

unit.

payment

par)
125

to

be

offered

shares of

com¬

Proceeds—For work¬

of

indebtedness to the
Office—4831 S. E. Division
Street, Portland Ore.
New York, N.' Y.

bank.

Underwriter—Merritt, Vickers, Inc.,
Wellington Electronics, Inc.

May

6

cents.

of

a

filed

240,000

Price—$6

bank

per

shares
share.

of

common

stock

note; to complete the automation

turers; and for working
capital.

Englewood, N.

J.

July 8.

&

75

repayment
of the etched

N. J.; for manu¬
capacitor manufac¬
Office—65 Honeck St.,

Underwriters—Amos

Truman. Wasserman
Statement effective

(par

Proceeds—For

foil production
plant at Englewood,
facture of machines to be
leased to

and

filed
an

error,

Office

of

3Qfl

on

,

...

the

stock

basis

.

one

per

nm

share

including

continuation oi

the

con-

St., Weaverville, N. Q,

-V.T*' )'■' •'r;v'

;

:

/>" q

additional 10,000,000 shares.
Office

—

Claymont, Del.

the details, of this filing

under the

(par $5)
of

Price—$6.75

amendment to its registration
statement

an

investment.

were

Proceeds—For
Note

—

listed last

Due to

Thursday

heading "Wilmington Fund, Inc."

Wyoming Nuclear Corp.
Sept. 11 (letter of notification) 10,000,000 shares

of

com¬

stock.

Price—At par (three cents per
share). Pro¬
mining expenses. Office—Noble Hotel
Bldg,,
Lander, Wyo. Underwriter—C. A. Benson &
mon

ceeds—For
\

Co., Inc.,

Pittsburgh, Pa.
York
Oct.

County Gas Co.
(letter of notification) 5,571 shares of common
(par $20) being offered for subscription
by stock¬

26

stock

holders of record Nov. 17,
1959, on the basis of one new
share for each 15 shares then
held; warrants to expire
Dec. 21, 1959. Unsubscribed shares
go to full-time,

regu¬

lar

employees (including officers) allowing them to sub¬

scribe for not

more

than 100 additional

shares, subject to
allotment; these rights also expire Dec. 21, 1959. Price-r-

$47

share. Proceeds—To pay off a
temporary bank
Office—127 W. Market St.,
York, Pa. Underwriter
—None.
•*.'
per

loan.

Prospective Offerings;
American Hospital
Supply Corp.
Oct. 28 directors of this
company have authorized an
additional equity
financing, number of shares has not as
yet been determined. Proceeds—For
company's expan¬
sion program, to retire bank

porate

Co.,

Treat & Co.,
Inc.,
of New York'

both

purposes.

loans, and for general cor¬
Underwriters—Eastman Dillon, Union

Securities & Co. and
Smith, Barney & Co., both of New
York.
Registration
Expected sometime after Jan. 1,
—

1960

American Jet
School, Inc., Lansing, Mich.

Aug. 31 it

was

announced

that the corporation plans to

issue and sell 100,000
shares of common stock (par $1).
Price—To be supplied by amendment. Proceeds—For ex¬
pansion of present
Michigan and Ohio sales force to a
national one, and introduction of
new courses and resi¬
dent study schools.
Business—In correspondence school
business.
Office—1609 Kalamazoo St., Lansing, Mich.
Underwriter—In New York, to be named. The company
is
presently negotiating with two New York under¬
writers.

of common

struction Corp. and Talco

t

equipment

Office—

Vulcan Materials
Co., Inc.
June 29 filed
10,000 shares of 614%

stock and

longer underwriting

Supply Co., Inc.
(letter of notification) 4,900 shares

to be used to

St., Brooklyn, N. Y.
Co., New York, N. Y.

including working capital. Office—120
Broadway,
New York City.
Underwriter—Ross, Lyon & Co.. Inc..
that

Proceeds—$1,850,000 is

capital. Office—373 Herzl
writer—Glen Arthur &

poses,

states

—

5806 Hough
Avenue, Cleveland, Ohio. Underwriter—Van
Alstyne, Noel & Co., New York City.
Vita-Plus Beverage
Co., Inc.
Aug. 11 (letter of notification) 300,000 shares of
common
stock (par 10
cents). Price—$1 per share. Proceeds—For
publicity, advertising, business promotion and initiation

share. Proceeds

(par one cent) and 30,000 common stock
pur¬
chase warrants, to be offered in
units consisting of $100
of debentures, 10 common
shares, and 5 warrants. Price
—$150 per unit. Proceeds—For general
corporate pur¬

York

debentures,
form in de¬

coupon

to be used for general
corporate purposes.

ance

stock

New

m

short-term bank loan undertaken in
connection with
acquiring the assets of Standard Felt Co., with the bal¬

common

debentures, due November, 1969, 60,000 shares of

convertible

a

for

Transportation Plan, Inc.
$600,000 of 7% convertible

delivery.

1

covering

Co., Inc.,

$1,000.
Price
At 100%
of principal
plus accrued interest from Dec.
15, 1959 to date

amount

of

of

&

(12/14-18)

$2,500,000 of 6%

15, 1974, to be offered

nominations

drilling and producing oil. Office—
1403 G. Daniel Baldwin
Bldg., Erie, Pa. Underwriter—
Daggett Securities Inc., Newark, N. J.

Oct.

Instrument Co.

filed

Dec.

stockholders

Underwriter—None.

Dec.

(par $101
Price J

—

Minn. Underwriter—Sakier
St., New York, N. Y. v'

50 Broad

—

expenses

Mines, Inc.

Ave., Eveleth,

—

—For

and

cts.

stock

Tri-State Petroleum
Corp.
Nov. 12 (letter of
notification) 199,900 shares of
stock (par five

Underwriter—O'Malley Se¬

Nov. 23

Co.

$10.75 per share.
Proceeds
For investment.
Office—South Main
Street, Greenville. S. C.
Under¬
writer—To be supplied
by amendment. Statement effec¬
tive Sept. 25.
•

in¬
unit.

Statement effective Aug. 11.

Vickers-Crow

development of undeveloped oil and gas
properties.
Office—Longview, Texas, Underwriter—None.
Trinity Small Business Investment Co.
April 17 filed 233,000 shares of capital stock
(par $1).
Price

per

no
less than $1,500 for
single premium
Proceeds—For investment, etc. Office—1832
Street, N. W., Washington, I). C. Underwriter—None.

conti

the

Trice Oil and

investment.

Price—$5,378.39

Variable Annuity Life Insurance Co. of America
April 21 filed $4,000,000 of Variable Annuity Policies.
Price—No less than $120 a year for annual
premium

Boulevard, Los Angeles, Calif. Underwriter—
Co., Los Angeles, who has acquired for

(1960)
Oct.

the

added

Offering—Expected

and

liquidate

Investment Co., Phoenix, Ariz.
June 29 filed 80 investment contracts
(partnership

Staats &

investment
10,000

to

Val Vista

curities Co.

to

ic Wellington Fund, Inc.

working capital, new equipment, and expansion. Office
—Louisville, Ky. Underwriter—Michael G. Kletz & Co.
and Stanley Heller &
Co., both of New York; Stein Bros.
& Boyce,
Louisville, Ky.; Roman & Johnson, Fort Laud¬
erdale, Fla.
Offering—Expected later this month.

•

offered

struction. Office—15 South Main

corporate purposes, including provision of funds for the
purchase of the assets of a similarly engaged enterprise,

Trans-World Financial Co.
Oct. 26 filed 645,000 shares of
common stock (par $1) of
which 420,000 shares are to be
offered for the account of
the issuing
company, and 225,000 shares are to be offered
for the accounts of the
present holders thereof.
Price
.—
To
be
supplied by amendment.
Proceeds — To
repay
bank loans on its own behalf and that of a

and

Proceeds—For general corporate
purposes*,
reduction of indebtedness and the

vention

"»

Underwriter-

share for each five shares held/

—

—

construction

Western Carolina Telephone Co.
Nov. 4 filed 71,513 shares of common

•

(par $1). Price—To be
Proceeds—To selling stockholders.
Office—168 Albion
St., Wakefield, Mass. Underwriter
Merrill Lynch,
Pierce, Fenner & Smith Inc., New York City. Offering
—Expected shortly.
*

Proceeds—For

None.

Universal Container Corporation
Sept. 25 filed 167,500 shares of class A common stock (par
10 cents), of which
150,000 shares are to be publicly
offered. Price
$4 per share. Proceeds — For general

outstanding common
supplied by amendment.

stock

par.

plant and for working capital.
Montgomery St., San Francisco, Calif.

Con¬

and

stock

company's

ment effective Oct. 9.

Electronic Corp.
1,000,000 shares of

common

,

Estes

& rv

;

40,000 shares of preferred stock (par
$25).

At

—

January.

(handling the books) and Kidder, Peabody
City.
'

Western Wood Fiber Co.
March 5 filed 100,000 shares of

(par 50 cents). Price —$2 per share. Proceeds —For
development and construction of a "Western Village"
of

Of?
Office^

Underwriters—BacE

& Co.

United Tourist Enterprises, Inc.

construction

Proeeet

both of New York

S.

for

c*;,

reduce indebtedness from
$1,650,000 to $600
with the balance to be used for
working capital.
1630 Locust St.,
Philadelphia, Pa.

Jan. 28 filed 4,500,000 shares of class A common stock

and

common

are

—To

Magnet & Alloy Corp.
Oct. 3 (letter of notification) 150,000 shares of common
stock (par 10 cents).
Price—$2 per share. Proceeds—
For general corporate purposes.
Office—266 Glenwood
Avenue, Bloomfield, N. J. Underwriter—Robert Edelstein Co., 52 Wall
Street, New York 5, N. Y.

March 20

mon

A

newly-"
^
underwriters from
the is*
ing company, and the remaining 392,000
shares are ont
standing shares to be acquired from the
present holdPr
thereof. Price—To be supplied
by amendment.

Co., Inc., and Colonial Boat Works, Inc., and
expenses incidental thereto. Office—Millville, N. J. Un¬
derwriter—Boenning & Co., Philadelphia, Pa.
U.

Thursday, December 10, 195.0

stock to be acquired by the

ardson Boat

•

.

Nov.

United

A

.

Wellington Management Co.
30 filed 450,000 shares of class
(non-voting), of which 58,000 shares

1*

President.

'

.

Bank of

Westbury Trust Co.
offering to the holders of the com¬
outstanding capital stock (par $12.50) of record

Nov. 24 the bank is

pany's
Nov.

12, 1959, the right to subscribe at $26 per share
additional shares of
capital stock.
Subscription
warrants will
expire at the close of business day on
Dec. 11, 1959.
Proceeds—To increase capital and'sur¬
9,750

plus. Underwriter—Francis I. du Pont
*Britton Electronics

&

Co., New York.

Corp.

*

.

It

has been reported that
this Queens Village,. L. L
company is expected to offer an issue of common stock
in

January,

—For plant

pursuant
and

to

SEC

an

registration.

Proceed^

equipment, including the expansion 0

semi-conductor line for silicon products.
—First
Philadelphia Corp., 40 Exchange
York City.
a

Underwrite
Place,

* Brooklyn Union Gas Co.
Dec. 7 it was reported that
the company plans to issu
about $20,000,000 of
securities in the second quarter 0
1960.
The precise form of the
offering is expected
be announced in the
first quarter. The company's cu
rent thinking is that it
will take the form of s1l"alg.
preferred stock. About

$120,000,000

spent, for construction

in the

is

expected to d

period, of wp
$80,000,000 will be sought from outside financing.,
with the
$4(1,000,000 remainder expected to be internal )
generated. Proceeds—The
offering now "in the x^orK
is expected to
liquidate bank loans of about $13,060."
1959-1964

some

the

company will have outstanding as of

the end 01 t
loans Uiic

year, in addition to about $2,250,000 of bank
taken in order to call in the

preferred stock of BrooKO -

Borough Gas Co., acquired by
This

company
Island (N. Y.)

lyn 1, N. Y.

had
area.

consolidation last-JU';
100,000 meters in the Co>..
Office—176 Remsen Street, Broos

about

|

Number 5906

190

Volume

.

.

The Commercial and Financial Chronicle

.

Underwriter—Midtown Securities Corp., same address.
Registration—Expected in a couple of weeks. Offering
—Expected in January, 1960.

Lansing, Mich.

Coffee House, Inc.,

31 It was announced company plans to issue and
eell 100,000 shares of common stock (par 10 cents). Price
^-To be supplied by amendment. Proceeds — To build
chain- of coffee houses, establish commissaries and for
general corporate purposes. Office — 1500 Clifton Ave.,
Lansing, Mich. Underwriter—In New York, to be named.

Aug.

Aug. 3 it

2 it was announced by Philip A. Fleger, President
and Board Chairman, that the utility's sole financing in
I960 is expected to consist of $20,000,000 of non -convert¬

debentures. Underwriter — To be determined by
competitive bidding. Probable bidders: Halsey, Stuart
& Co. Inc.; Kuhn, Loeb & Co.; Eastman Dillon, Union
Securities & Co.; A. C. Allyn & Co., Inc. and Ladenburg,
Thalmann & Co. (jointly); White, Weld & Co.; The First
Boston Corp. and Glore, Forgan & Co. (jointly); Blyth
& Co., Inc.; Drexel & Co. and Equitable Securities Corp.
(jointly). Offering—Expected in mid-February.
Engelhard Industries, Inc.
Dec. 2 it was reported that this Newark, N. J., corpora¬
tion might make an announcement in the next two
weeks concerning a forthcoming issue of common stock.
First National Bank of Miami, Fla.
Sept. 14 it v/as announced stockholders have approved
a proposed offering to stockholders of 150,000 additional
shares of capital stock (par $10) on the basis of one
new share for each four shares held.
Price—$40 per
share. Proceeds—To, increase capital and surplus. Un-

to

1959.

A.v /

>■

,

8 it

the sale of about

New York
of

National
Oct.

Continued from page 6
D. T.

District
with

$16,934,000 (1-30 year) bonds.
The State of New Jersey will
seek to borrow $66,800,000 on
Dec. 15 and DeKalb County,

Georgia School District will
ask for bids on $11,500,000
the

day Richmond, Vir¬
ginia will ask for bids on
$8,800,000 public improve¬

branch ATLANTA,

a

Street, N. W.,

Greene &

a

be easily absorbed
given realistic pricing.

Exchange Business at
High Level

bond

Dempsey-Tegeler Office
REDLANDS,

continue

office

Calif.

Dempsey-

—

at

8

East

a

tend

ketwise.
tant

balance

to

There

is

in

news

no

and

At

against

as

this

usual

time

for

at

a

of

one

is

it

year,

least

large

negotiated type issue to come
to

market.

This

under

debenture

is

&

Smith

VicePierce,

Incorporated,

With Reynolds & Co.

25,116 shares of class A common stock ($1 par). White,
Pierce, Carrison, Wulbern, Inc. (jointly)
will underwrite the offering.
It is expected that the
offering will take place early in January.

9,

118v030 shares of the
par) of Dutron
offered at a price of

office handled

underwriter

the

stated

C. A. Marshall

N. C.—Phil H. Mast
is with Reynolds & Co., 108 Cor¬
coran

excess

of

$1 million, follows:

$100,000 for 2,000 ton molding
press; $150,000 for boiler, auto¬
clave, 350 ton molding press, %
ton pick-up truck, blue print ma¬

branch

Skaife Adds to Staff
OAKLAND,

Calif.

3099 Tele¬

Main

26

Hill Richards Adds

New

(Special to The Financial Chronicle)

Dec.

•

Lindley, 61 Broadway,
City, members of the
York
Stock
Exchange, on

staff

of Hill Richards &

Doran
is

engaging

ness

drick Street under the firm name
of

Dockray

&

Co.

He

was

under the direction of

from

in

a

15

at

Glover

Donald W.

at

120

North

•

a

Sees.

ELMONT, N. Y.—Harwyn Securi¬
ties Co. has
been formed with
offices

our

securities busi¬

offices

Form Harwyn

for¬

merly with Charles A. Day & Co.

Calif.—E. F. Hutton
have
opened
a

under the management of
E.

Robert

Jackson.

will

56

the

Kamehameha

management

Botts.

Avenue

of

under

Bankers
cover

Association

the

activities,

newly elected officers from this

nation.

Get your

from the
•

our national economy
Investment Banking Fraternity.

perspective of

Firm,

Corporation

King Street

in a securities business.
Harry Weintraub is proprietor. He
was formerly with Richard Bruce

or

December 17,

to engage

& Co.

ties
East

business
Coleman

from

at 29
He was

offices

Avenue.

Richard M. formerly with Quinn, Nue & Co.,
Inc.

1959

Regular Advertising Rates
For

CHATHAM, N. J.—George A. Mc¬
Cutcheon is conducting a securi¬

advertise your
Bank in the issue of

Don't miss the opportunity to

MacMillan.

WINTER PARK, Fla. — Jerry HILO, Hawaii—Walston & Co.,
Thomas & Co., Inc. has opened, a Inc. has opened a branch office at




Company

convention. Pertinent factors will
expressed by the leading financial executives
on
the economic and financial conditions of

Opens Office

Mr.
Doran
has
been
George E. Place.
partner in Kearns & Williams.

—

New Walston Office

of

&

branch office at 7606 Girard Ave.

be

Co., 600

G. E. Dockray Opens

issue

The Commercial &
25 Park

Will Prevail

Space in This Number.

G. A. McCutcheon Opens

direction

JOLLA,

important

Calif.—Perry to partnership.

FRANCISCO,

BALDWIN, N. Y.—John L. Doran

Thomas Opens Branch

the

New Hutton Branch
LA

Investment

addresses and

admit Andrew Teller

will

1

1959

The

Convention

York

Farrell has been added to the

Buell and Company has opened a.
Peabody
& Co.
has opened a
branch office at 55 Wall Street branch office at 29 Clinton Street

under
Ned R. Steele.

Lynch, Pierce, Fenner & Smith
Incorporated, 55 Public Square.

OF THE CHRONICLE

&

Seeley

Kidder, Peabody Office

Avenue,

Lynch

CONVENTION ISSUE"

Street

John T.

Seeley & Lindley Admit
New

F.

at

Ken-Matsu-

—

PLATTSBURGH, N. Y. —Kidder,

Knowles

Two With Merrill

CLEVELAND, Ohio —George R.
Colley, Jr. and Herbert McBride
have joined the staff of Merrill

ASSOCIATION

Sherman.

graph Avenue.

SAN

office

re¬

purposes.

"INVESTMENT BANKERS

under the management of

(Special to The Financial Chronicle)

Buell Opens Branch

201

accounts

DON'T MISS IT

HAMPTON, N. Y. — Spear,
& Kellogg have opened a

Leeds

TORRINGTON, Conn.—Robert C.

at

and

Opens

Spear, Leeds Branch
EAST

Street.

Dockray is conducting a securities
business from offices at 57 Hen-

office

corporate

approximate disposition of
proceeds, estimated at in

GREYBULL, Wyo. — Charles A.
Marshall is conducting a securities
business with offices at 505 Grey-

DURHAM,

PROVIDENCE, R. I.

branch

inventories

ceivable; $105,000 for redemption
of preferred stock of subsidiary
and
the
remainder
for
general

net

&

curing

leasehold

in

stock (no

The

and

ovens;
$50,000
improvements;
$50,000 for additional equipment
as need arises; $350,000 for work¬
ing capital required by increase

for

pre-offering
interest
was
such that the rapid completion of
the offering was assured.

rities, business.

the not inconsiderable volume

under the management of Ernest
H. Cady, Jr.

C.—Weil

D.

originally contemplated that

was

Weld & Co. and

Francisco

rspecial to Tiie Financial Chronicle)

and dealers must suffice with

exchange business that

It

proposed financing would consist of $837,200 of
71/2% subordinated debentures and warrants to purchase

bull Avenue, to engage in a secu¬

an

has persisted since mid-year.

bonds.

the

that

the

Corporation

>

specific type of securities to be offered in exchange for
the company's presently outstanding 6% 20-year income

were

books.

the financing of

amendment to its original registra¬
Aug. 28 which will provide for the

$10.75 per share. The offering was
written by J. Barth & Co., whose
San

tc

first

Pro¬

Francis D.yWillis
Francis D. Willis, or Atlanta,

exception to the last several,

of tax

ond Avenue.

California Street.

year

Grif¬

of

pany.

ago.

year

business

investment

McCarthy, 8340 Northeast Sec¬

vestment business of Weil & Com¬

Street

of Skaife & Company,

ment

fin

to continue

the

Shetucket

1

revenue

to show improve¬

the

Griffin McCarthy,

—

has been formed

Inc.

management of Harold A. Soloff.

moto has been added to the staff

reports continue, in

MIAMI, Fla.

Company, Incorporated, 734 15th
Street, N. Y., is continuing the in¬

individual issues, but monthly

most cases,

Corporation

&

impor¬

to

Corp.

WASHINGTON,

Conn.—Irving Weis
Co. has opened a branch office

mar-

respect

Dec.

common

of

an

of

Corp. Stock
On

NORWICH,
at

statement

Offers Dutron

Jr.

Exchange.

Now

passed away Nov. 21st.

is considerable tax exchange

business in this category

tion

sold

An

Fenner

fairly active and firm. There

trades

branch

under the

Citrus

Thomas

B.

joined the staff of Courts &
Co., 11 Marietta Street, Northwest,

Irving Weis Branch

be

to

Ga.—Comer L. Haw¬

Brower

management of Walter B. Johnson.

dollar-quoted revenue
issues

and

be

plans

sale

Office—Houston, Texas.

chine

have

Now

President of Merrill Lynch,

The

ing the filing of

J. Barth & Co.

Nov.

away

Tegeler & Co. has opened

will

the

permanent funds for

members of the New York Stock

limited partner in

Ladd, passed

kins

29th.

should

Tax

un¬

volume

This

bonds.

Brown,

On

same

ment

1627 K

der the management of Carl Luick.

issue

(Special to The Financial Chronicle)

Akiba

—

the

of

Two With Courts

Opens Washington Branch
WASHINGTON, D. C.
Zilberberg has opened

66%

with

1960

West Florida Natural Gas Co.

was

About

in

Nov. 25 it was reported that the company is contemplat¬

Co., Lansing, Mich.

.

stock.

raise

ceeds—To

Stores, Inc. (12/14-18)
reported that the company is contem¬
plating the placing in registration of 17,000 shares of
it

twice

market

its 1960 expansion program.

was announced company plans to register an
100,000 shares of common stock (par 10 cents).
Price—To be supplied by amendment.
Proceeds—For
expansion and working capital. Office—130 Shepard St.,
Lansing, Mich. Underwriter—To be^iamed later in New

12

to

come

mortgage bonds, and common and preferred stock.

issue of

D. T. Brown

16.

.

it

5

been

reported that the company is

was

Transcontinental Gas Pipe Line Corp.
Sept. 29 it was announced that the company

Nedick's

Bond Market

Dec.

Mail Order

cur¬

have

ated underwriting. Last rights offering was underwritten
commission / by Stone & Webster Securities Corp., New York.

—

common

on

gross

a

Independent Radio, Inc., Lansing, Mich.
Aug. 31 it was announced company plans to issue and
sell 100,000 shares of common stock (par 10 cents). Price
—To be supplied by amendment. Proceeds—For acqui¬
sition of radio stations. Business
Radio broadcasting.
Office—130 Shepard St., Lansing, Mich. Underwriter—
In New York, to be named.

acquisition.^ Office—30 East 60th Street, New York City.

to market Dec. 14

on

issues

planning
$7,000,000 of additional common stock-,
probably in the form of a rights offering and a negoti¬

12%.

Nov.

serial bonds

City, who will work

Previous

program.

Tampa Electric Co.

—

York State.

office at

Proceeds—To repay bank loans incurred for
construction

placed privately.

was

Price

that a public offering of. common
stock is expected later this year. Proceeds — For land

comes

rent

$3 per share. Proceeds — For working
capital and equipment. Office—405 Lexington Ave., New
York City. Underwriter — Plymouth Securities
Corp.,

A-'-

Tax-Exempt

22, S. C. McMeekin, President, announced plans
approximately $8,000,000 of bonds in December,

sell

weeks.

Oct. 22 it was reported

School

placed

were

Sept. 14 it

Florida West Coast Corp.

Independent

Last bond issues

bonds.

reported that this corporation expects to
register 200,000 shares of common stock in the next few

_

.

South Carolina Electric & Gas Co.
June

received approval from

company

the Territorial Public Utilities Commission to issue about
new

company's account and the remaining 34% bal¬
will be sold for the account of a
selling stockholder.

Underwriter—Van Alstyne, Noel & Co., New York.

$4,500,000 of
privately.
Dec.

ible

•

ance

itr Hi-Press Air Conditioning Corp. of America

pe<'.

| derwriter—None.

reported

was

45

for the

Hawaiian Telephone Co.

Light Co.

Duquesne

$

(2441)

Financial Chronicle

Place, New York 7, N.

Y.

46

(2442)

The Commercial ana Financial Chronicle

The

Indications of Current
Business Activity
AMERICAN

IRON

AND

INSTITUTE:

Equivalent to—
ingots and castings

AMERICAN
Crude
<12

PETROLEUM

oil

and

gallons

Crude runs

(net

Dec. 12

tons)_

§2,871,000

of''

8,963,675
1i 7,973,000

6,886,775

6,983,385

8,017,000

Nov. 27

•7,491,000

7,785,000

28,957,000

28,816,000

Nov. 27

27,239,000

2,333,000

2,213,000

Nov. 2.7
Residual fuel oil
output (bbls.)-.*,—Nov. 27
Stocks at
refineries, bulk terminals, in transit, in pipe lines—
Finished and unfinished
gasoline (bbls.) at
Nov. 27
Kerosene (bbls.) .at.—-

28,141,000
2,234,000

12,904.000

12,561,000

1,880,000
11,849,000

7,040,000

6,735,000

6,279,000

output
Kerosene output
Distillate

(bbls.)
(bbls.)

fuel oil

(bbls.)

average

—

—

—

output

———„

(bbls.)

inov. 27

—„

——

L—L—.a

179,179,000

177,260,000

Nov. 27

"31,692.000

31,970,000

Nov. 27

170,836,000

174,571,000

Nov. 27

56,189.000

56,292,000

Revenue freight loaded
(number of cars)—,—
,__Nov. 28
Revenue freight received from
connections (no. of cars)—Nov.
28
CIVIL ENGINEERING

574,126

629,362

^—_.

Distillate

fuel oil (bbls.) at
Residual fuel oil
(bbls.) at—

ASSOCIATION

OF

AMERICAN

———

!

RAILROADS:

-

CONSTRUCTION

:

/

S.

construction
construction

Private
Public

COAL OUTPUT

Bituminous

(U.

coal

,

;

.

S. BUREAU

and

OF

Dec.
Dec.

$383,400,000
233,400,000

187,800,000

104,300.000

150,000,000

160,005,000

147,600.000

239,127,000

70,000,000

202,000,000
160,800,000
41,200,000

8,050,000

9,425,000

7,935,000

421,000

387,000

369,000

Dec.

79,400,000

MINES):

=

100

ELECTRIC INSTITUTE:
Electric output (in 000
kwh.)

.

FAILURES

(COMMERCIAL AND
BRADSTREET, INC

Dec.

INDUSTRIAL)

DUN

—

METAL PRICES

Electrolytic

gross

(E.

&

J.

(New

Lead

(St.

13,173,000

1

"

171

13,019,000

13,017,000

265

6.196c

1

6.196c

$66.41

6.196c

$66.41

$66.41

$43.50

$66.41

$44.17

$46.17

$40.17

Dec.

33.475c

Dec.

33.825c

32.900c

29.650c

28.600c

29.500c

30.825c

13.000c

27.650c

13.000c

13.000c

13.000c

at

Dec.

12.800c

Dec.

12.800c

12.800c

13.000c

12.800c

13.000c

13.000c

12.000c

Dec.

—

Dec.

12.500c.

12.500c

24.700c

24.700c

99.625c

100.500c

I—

Dec.
a—;

Dec.

III

Group

Utilities

.-Dec.

I

I

Group

Industrials Group
MOODY'S COMMODITY

Dec.

8

—Dec.

8

(tons)
of

84.17

87.99

90.48

88.27

87.86

95.16

86.11

86.24

85.98

83.79

93.08

84.04

79.25

84.17

90.06

79.25

79.13

82.03

84.30

82.15

82.52

88.54

INDEX

84.55

83.79

90.48

86.38

86.38

92.64

Transactions

of

AND

4.06
4.20

5.25

5.25

5.01

4.46
'

sales

Other

sales

4.82

—

sales

the

on

floor—

Other

sales

sales

—

;

round-lot

Total

transactions for account

purchases—
Short sales
—,

—,

Nov

——_

of

,

—

Nov

sales

13
13

13
13

_.

———Nov. 13

sales
of

—

by

SECURITIES
dealers

EXCHANGE

(customers'

IIIIII Nov

,\Odd-lot purchases by dealers
(customers' sales)—
Number of

orders—Customers' total sales

■

Customers' short sales
Customers' other sales
Dollar

~

value

"

Round-lot sales by dealersNumber of shares—Total
sales
Short sales
Other

sales

"*

Nov

13
13

THE

ACCOUNT OF
MEMBERS
Total round-lot sales—
Short sales
Other

N.

Y.

All

aB

of

—

369,636

2,129,650
376,710
1,768,110
2.144,820

1,874,840

of

616,710

2,340,070
2,956,780

1,828,280

59,100

90,600

508,950

53,100

338,840
429,440

35,200

317,340
370,440

626,820
662,020

of

13

13

ingot

1,030.000

30

ton

—

of

140 742 <wn

yvesrem ^mc sold
sold

on

on

11.867c

£75.275

£90.179

£88.457

£72.803

91.375c

-

79.955d-

-

..

,

■

80.125c
77.419(1

.

$2.80627.
•

$2.80553

102.274e

99.022c

$35,000

$35,000

$223,333

3227.045

32.590c

32.590c

32.590c

29.000c

29.000c

29.000c

29.500c

29.500c

29.500c.

$77,000
t
.

$1.75000
:

$55,864

$1.30000

$1.45000

$1.40000

Not avail.

$1.75000

•

.

$2.00000

26.800c

26.800c

24.700c

24.000c

24.700c

35.250c

35,250c

35.250c

74.000c

"4.000c

$2.25

$2.25

32.25

$31,800,000

$32,000,000

." $31,200,000

*$380.9

5364.3

*259.2

'242.1

,*106.8

98.7

a——

—i_

:

*

—

74.000c
*

—

-

26.800c

DEPT.

omitted)..-—

Other

,

labor

756,867

1,061,428

773,748

1,280,288

Personal

2,766,537
3,331,127

2,909,215

Business

and
•_

4,028,318

2,972,468

4,899,088

870,770

Less

1,581,506

1,705,039

$81,961,393

$89,400,397

payments

employees'

;

■

1,884,230
$89,140,083

1,333,654

11,573

1,884.693

13,077

1,326,621
$66,807,859

10,092

1,320,577

1,874,601

$67,224,748

$90,715,850

—'

r

contribution,

surance
Total

327,980

tor

social

Feed,

grains

and

crops

Meat- animals

11,915,580

and

105.2

105.1

89.7

nr

>

f

where

91.1

106.0

89.8

108.5

92.7

101.7

128.7

128.7

127.0

freight

12.6
20.7

27.3

*27.0

27.4

7.4

346.3

-■-

.-•

:

,

*8.4

*367.5

.

235

;

a

"

__

...

_

214

205

280

281

15G

149

203

198

201

214

230

267

208,.

204

149

—

221

220

,

hay

249

239

'•.1

274

212

147

146

111

505

510

499

248

256

274

273

265

270

291

307

138

143

162

235

244

203

$1,183,618

$1,203,179

$1,021,659

_

eggs._

,
'

.r

,

_

_

_

333

ESTATE
OF

FINANCING IN NONFARM
U. S. — HOME
LOAN BANK

BOARD—Month of Sept. (000's
Savings and loan associations

omitted):-'

_=

Insurance

companies'
and
trust
companies

savings

banks

136.091

137 391

135.951

480,619

505 3^7

492-687

172.520

167 151

170.394

340,291

336 431

520,831

521,586

■396.072
479.045

$2,833,970

$2,871,075

$2,596,008

•

—.

—

_

—

119.0

86.4

new ann«al capacity of 147,633,670
tons
not reported since introduction of

hnc(^ at centers
Cr i°f orders

13.5

23.0

-

AREAS

nm*

delivered basis
delivered

11.9

12.0

13.5

23.3

-.

119.2

*85.4

128.0

14.2

-

Individuals

119.0

33.2

9.6

241

—

REAL
1,006,060

*34.8

10.0

_.—

Dairy products

20,820,850
21,826,910

9.3

34.9

219

„

Tobacco
Livestock

609,380

623,450

44.1

10.2

'

;

Oil-bearing

603,110

84.9

»

Fruit

711,220

11,292,130

46.2

10.2

'

327,980

118.9

"

-

;

——

5(51,280

676,940

35.2

46.4

-

...

13,717,460

*37.8

8.4

vegetables, fresh—

337,300

14,394,400

64.1

37.9

-

Commercial

-

*68.3

368.0

—

Crops

,

76.9

68.4

in¬

income

_

603,110

*84.4

...

nonagricultural

Potatoes

337,300

83.7

12.0

Cotton

9,686

745,430

3,

,

.

■

income.

__

1,338,194

684,170

persons..

—

interest

__

1,502,830

374,870

of

U.
S. DEPT. OF
AGRICUL¬
TURE— 1910-191 l=f (Ml
As of Oct. 15:.
farm
products

$93,652,438

374,870

—1:

—....

All

1,828,308

•

...1—

Rental

Transfer

498,433
2,474.035

r

106.2

professional.

Farm

„

4,797,210

259.0

i

income

659,587

564,590

..

industries
Government
...'

1,006,555

3,333,930

$381.9

total——
industries

Service

income
Dividends

616,220
3,568,885

—...

receipts,

Manufacturing only
Distributing industries

218,860

4,023,180

COMMERCE)—Month

Commodity * producing

1.060,270

16,195,860
16,941,290

LI

11.367c

12.629c

£91.366

aver¬

pig

pound)'
A

OF

salary

144,583
629,165

'

crude

12.129c

£75.838

13.000c

$1.30000

■

-

primary

(per

(in billions):
income.

and

670,345

OF

foreion

.

£94.935

$77,000

lots)

pound)-—:

personal

Wage

97,280

nec

of

£71.608-

$35,000

L——

ingot weighted

(000's

752,220

foodsI777I„7 Dec!

barrels

£72.390

$216,611

:

CIRCULATION—TREASURY

137,810
868,745

rw

and"

12,800c
£75.584

$1.40000

-

864,570

n

1959. as against Jan.
1, 1958 basis
Monthly investment Plan.
'Prime Western
Zinc
one-hair cent




(per

"grade

pound) 1
99%
grade

October

Total

Poultry

"

pound.

99%

Sept.

,

lots).—

grade

•

MONEY IN

—

—

ounce)

Bisuruth (per pound)

2.996,500

300.750

1,527,530

740,440

1,493,144

Nov

7

1,

(per

(DEPARTMENT

364,030

$76,890,597

77777NoV
U. S. DEPT

77777

a

^Nickel

Mutual

^Includes

97%
(per

Banks

commodities other than
farm

Jan.

refined

Aluminum,
Magnesium

286,263

452,060

STOCK

foods

"Revised figure.

Cobalt,

_

Meats

pounds)—
...

88

13

...

13-OCOc

12.800c

80.250d

-

76

96

jsjov'

Nnv

£236.588

£70.619

$2.80268

price)
of

95

13

13

S.

flask

(per

Antimony

age

All

Processed

ounce, *U.

Quicksilver

323,362

13

13

13.000c

r

101.042c

lIAnJimony, New York, boxed

Wool

100):

commodities
Farm products

(per

!

Straits

391.7

TRANSACTIONS

11177"
NEW SERIES
=

Gold

York

Platinum,

•110.54

29.476C

.

12.800c

91.375c,

4.84

111.77

28.665c
■.".'242.975

•

£72.146

12.500c

—

—_

Total sales

LABOR—(1947-49
Commodity Group—

New

259,412

111.61

■

£263.875

.

13,000e
:

—a

(check)—--

4.52

(SHARES):

sales

WHOLESALE PRICES,

Tin,

Exchange

4.89

483,208

$5,614

•

328,047
332,303

Nov

Nov'

£241.381

poundl

4.56

v

13

Nov

£241.920

Sterling Exchange—

296,038

i>jov'

„

£250.583

ton)„i

275,752
310,853

4,185,105

~HI
Round-lot purchases
Nov 13
by dealers— Number of
shares—1—I.Nov! 13
TOTAL ROUND-LOT
STOCK SALES ON
EXCHANGE AND
ROUND-LOT STOCK
FOR

and

NUMBER

Nov

29.150c

pound)-,:"——
(per

long

Silver, New York
(per ounce)J
•Silver, London (per ounce)-c—

COMMISSION
;

32.576c

30.481c

< per

Silver

621
;

$5,353

7 '

34.060c
—

London (per long ton)—
pound.)—East St. Louis
§§Zinc, prime Western, delivered
(per pound)
ttZinc, London, prompt (per long ton)
tvZinc. London, three months
(per long ton)
Zinc

695

863

"

t"'Three months,

purchases)—f

shares

value

(per

Louis

(per

(small

568,050

BTOCK TRANSACTIONS
FOR ODD-LOT
ACCOUNT OF ODDLOT DEALERS AND
SPECIALISTS ON N. Y. STOCK

EXCHANGE

York
St.

$5,780
■'

$4,298

558
*•

'

•

(per pound, delivered

469,641

$3,932

954

long ton).—

Cadmium

510,280

.,,

Nov

New
East

'

'

•

5

'

Cadmium

2,610,500

Nov. 13

sales

(per

4.23

2,191.190

13

members—
—

n

London

*

Common,
Common,

•375,618
1(55.923

;

PERSONAL INCOME IN THE
UNITED STATES

Nov. 13

Nov!
——

173,000

Oct.

ton)——

4.38

2,648,330
419,310

Nov. 13
Nov 13

——

long

4.43

111.54

Nov. 13

I

months,

(per

4.25

4

Nov. 13
—Nov. 13

—

prompt

tILondon,. prompt

As

IINov.
;

purchases

Short

152,000

430,267
931,541

.

"

384.5

91

Nov. 13

initiated

526,000

QUOTATIONS) —

4.68

438,833

Nov. 13

-

„

•

Exports
tfLondon,

•

SPECIALISTS

^

—

516,000

$1,'11.1,808

•

378.2

MEM¬

sales

———————

,

of

•
.3,..
refinery (per pound)—
refinery (per pound)™i—

Aluminum;

Nov. 28

J.

/•

•

-

4.68

Nov. 28

transactions initiated off the floor—

Other sales
Total sales
Other transactions

699,000

j.

M.

&

23.700

$85,000

INSTITUTE

—

377.2

•

Nov. 13

purchases

$1,494,000
795,000

$4,241

Domestic

4.41

specialists in stocks in which
registered—

Short' Sales

.

PURCHASES

(per pound), bulk Laredo
Antimony (per pound) boxed Laredo

'

Total purchases

Short

790,000
668,000
'

November:;

4.38

4.10

4.21

8

Dec.

4.42

4.54

8

OF

4.84

4.69

Dec.

Nov. 28
Nov. 28

ACCOUNT

BERS, EXCEPT ODD-LOT DEALERS

Dollar

-

'

3.60

4.86

—Dec.

-

3.62

4.88

5.02

—

4.34

4.70

4.84

-

FOR

="$89,500

———1.—_.

Sterling

4.85

8

activity

TRANSACTIONS

$89,100

$1,458,000"

.—_•

—

86.38

8

Unfilled orders (tons) at end
of periodOIL, PAINT AND DRUG
REPORTER PRICE INDEX—
1949
AVERAGE—109

Number

—

1

municipal—

(E.

'<*9.300
12,100

12,600

of

—

84.30

*

="24,800

585

Lead—

84.30

'$52,100

12,500

24,800

'

Industrial

24.700c

84.17

Dec.

,

Odd-lot

.

EN¬

—

Month

—

:

417

12,525m
5,390
560;335,027

v

•;

.

24.700c

88.17

—II——Dec!

-

Production

Percentage

Total

CONSTRUCTION

omitted)

LIFE
INSURANCE —Month
(000.000's omitted):.,

Copper—

$632 860

Sept;

constructioni--'—v._::c.J:--—~~rr;

INSURANCE

ttThree

99.125c

4.37

.

NATIONAL PAPERBOARD
ASSOCIATION:
Orders received
(tons)

Other

.,11 E

S.

and

11.500c

82.79

4.56

Total

COM-

of

*%•»'?•_

.

NEWS-RECORD

construction

12.500c
101.500c

81.73

ZII—II—III—I Dec!

Group

„

Total

.

551,800

construction

State

•

82.02

AVERAGES:

MOODY'S BOND YIELD
DAILY AVERAGES:
U. S. Government
Bonds
Average corporate—

Total

•;>

_

(000's

METAL PRICES

—Dec.

-Dec.

Public Utilities
Group
Industrials Group

Total

(J.

Private

294

1

Dec.

Baa

Total

OF

Month

—

.,

,—i—A—1LZAiX-J——A>.

ENGINEERING

Total

,

365,000

Dec.

Dec.

Other

Munuiacturing

DEPT.

—

SERIES

dollars):

GINEERING

7,766,000

Dec.

—

ROUND-LOT

'

145

2G8

6.196C

Dec.

Public

of

;

*

U. S.
Government Bonds
Average corporate-.

Railroad

City

NEW

(Millions

31.635.204
118.745,155

148,684.470

•4^----^.-^'---

OF

261

-

Railroad

City

BUSINESS INVENTORIES

CIVIL

-

'

$577,186,7997 $705,179,999
80,887,522
136,353,039
—4—•498,299,277-: 568,826.960

copper—

York) at-.
Louis) at
fZinc (delivered) at—
Zinc (East St.
Louis) at
Aluminum (primary
pig. 99.5%)
Straits tin (New
York) at
MOODY'S BOND PRICES DAILY

Aa

.30,452,000

182

QUOTATIONS):

Domestic refinery at
Export refinery at
Lead

13,907,000

3

Dec.

ton)

M.

208,675,000

26,700,000

■

States^——i--I:—-

York

New

Public

176

5

Dec.

COMPOSITE PRICES:
Finished steel (per lb.)
Pig iron (per gross ton)

(per

York

67,296.018
131819.253
91.348,363
50.505,547

113,217,678
102.172,473
42.114,041
38,385,782

39,157,455-

28,963,374

S29.256.060'
112.204,717

57,535,278

104,772,998

—-

$399,132,000

120,900,000

&

IRON AGE

Scrap steel

New
?W

Jutside

,

-

—

United

November

Nov. 28

EDISON

1—

_

-

125,197,846

Total

530,626

$251,900,000

lignite (tons)-

AVERAGE

544,381

.

37,677,358
94,812,705

'1—-—A'-A-

MERCE

$389,800,000

Nov. 28
Pennsylvania anthracite (tons)
Nov. 28
DEPARTMENT STORE SALES
INDEX—FEDERAL RESERVE

SYSTEM—1047-40

539,489

Ago

$31,306,500
171,763.777

118,193,428

•

Wholesale
Dec.

—

;J—A:

municipal

588,148
524,211

$28,411,635

:2———

Central

Pacifjc

66,199,000

Year

Month

CITIES—Month

Central_—

Mountain

..

.

;.

construction

State and

South

31,932,000

161,439,000

ENGINEERING

-r-

NEWS-RECORD:
Total U.

533,385

♦

181,546,000
58,050,000

Central

West

173,600,000

33,035,000
.

Previous

&

—

Atlantic

i»asv,

6,536,000

176,147.000

Atlantic

South

13,291,000

DUN

—

"————-J-,——-:.—

Middle

Nov. 27

————-

VALUATION

INC.—315

date:

October:

New

(bbls.

average

_——

stills—daily

of

1,985,000

6,934,575

to

PERMIT

of that

are as

Month

BUILDING

195c,

either for
the

are

Latest

73.5

1,291,000

INSTITUTE:

of quotations,

cases

Ago

45.6

"2,650,000

in

or,

Year

Ago

*93.6

Thursday, December 10,

.

Dates shown in first column

that date,

on

.

production and other figures
for the

cover

BRADSTREET,

Dec. 12

condensate output—daily

each )v—»'

Gasoline

-

Month

Week

§94.3

month available.

or

month ended

or

Previous

Week

Indicated Steel operations
(per cent capacity)—
Steel

week

Latest

STEEL

following statistical tabulations

latest week

.

from

East St. Louis
exceeds

Miscellaneous
Total

—L

•"Revised

96%
end

Of
of

more

and

_

_

....

.

tEstimated totals based on
reports from comuanies accounting tor
95%
of
secondary fin consumption in 1957 and
97'f., to VHai stoc.-;.''

^Includes tin content

of imported
tin-bused alloys. TDomesUc fi^e tons or
than carload lot
boxed.
§s>D«divered where freieht from E«st St. Lou.s
*'*F.o.b. Fort Colburne, U.
S. Duty included.
ttAvera^e of da"v. mean and
quotations per long at

less

exceeds 0^5c.
bid

institutions

figure.

orimary.
1957.

but

lending

a%k

morning session

of

London

Metal

Exchange.

Volume

Number 5906

190

.

The Commercial and Financial Chronicle

.

.

Forms Feren & Co.

Lester F. Gannon

Businessman's

LIVINGSTON,
Feren

J oins Ketcham Co.

BOOKSHELF

has

Gannon

F.

Lester

fice of Andersen,
to

Hobart

resigned

Randolph & Co.
of the trad-

Morton

—

conducting

securities

a

offices

Wainwright,
Ramsey, Inc.

West

at 244

Oppenheimer & Co. and

Investment

Planning

Group,

MIAMI, Fla.

Inc.

well-known

depart¬

ing

in1

ment

circles

the

International Securities

Workweek

nomic Indicator

—

as
an
Eco¬
Gerhard Bry

—National Bureau of Economic

Ketch

Co.,

Avenue,

(paper),

$2.00.

N.

—Bank

Year-Book 1958
Finland,
Helsinki,

of

Finland

(paper).

by

R.

Mr.

Growth and Price
Levels—Part 8, The Effect of
Prices

the

and

Salaries,
Personal

of

Services, together with Union
and Professional Practices upon

Prices; Profits, Production, and
Employment — Hearings before
of

States

of

—

Development

Government

Rico

for Puerto

report

(paper),

C.

D.

25,

Superintendent

U. S. Govern¬
Office, Wash¬

Documents,
Printing

ment

ington

75(:.
Bank

16th annual

—

Government Develop¬

—

ment Bank for Puerto

Rico, San

ton-Century-Crofts,

New

Inc.,

York, N. Y.
Law: A

Price Discrimination

his

ca¬

ficers

dent

at

in

Weeks

securities
such

Morgan

Bonn

&

Co..

with

&

&

Co.

and

He

had

been

Co.,
W. T.
asso¬

Randolph,
a
brokerage concern with head¬
quarters in Salt Lake City, since
Andersen,

World

A

in

served

War

the

Street

quarter, $50 per

per

Perkin-Elmer

on

York

New

Le¬

Association

the

and

Wall

member of the

a

Security1 Traders

of

Friday Night

and

Henry J. Arnold to
Be Ky. Colonel
Ky.—Governor A.

LOUISVILLE,

i

the

to

Hillsdale, N. J.
Manual—Cover¬

Tax

counties

New

of

York

City, Nassau, Rockland, Suffolk
Westchester—Inter County

and Mortgage
Broadway, New(on request).

Guaranty

Company, 111
York 6, N. Y.

Placement

Private

Israels

ginia

of

Overtones

Commercial

Some

Carlos L.

—

Reprinted from Vir¬
Review—Carlos L.

—

Law

Isreals, 20 Exchange Place, New
York 5, N. Y.
United

States

Aid

Indian

and

Economic

Development

Bauer

American

—

on

—

Atomic -Energy

S.

Commission,

Washington 25, D. C. (paper).

Henry

J.

Arnold,

of

Geo.

Eustis

Co.,

Cincin¬

nati,

of

charge
r a

will

admit

Frances

business

from

of¬

Greenpoint

Ave.,

New York City. Thomas D.
is a principal.

Levis

Mo.—Edward D.
branch
1 East Washington Street

CHARLES,

& Co. has opened a

Branch

FT. LAUDERDALE, Fla. — A. C.
Allyn & Co. has opened a branch
office

at

teenth St.

2180

Southeast

Seven¬

under the management

of Everett C.

Swanson, Sr.




of

this

office

branch

tered
close
In

of

addition,

Henry J. Arnold

was

presented

Louisville, at a
meeting of the
Bond
Club of
Louisville on
Dec.
8, with ap¬
Company,

propriate ceremonies.

under

Bank

Building under the manage¬
Phipps.

Drive

Camden

of

name

He was

Co.

Alkow &

opened

of

Co.

under

formerly

|

office

At
■

a

at 401

Cedar

the management

*

the

Lane

of Milton

held this day, a quarterly divL
share and an extra
dividend of 15<t per share were de'
clarcd on the common stock of the

Opened

management

Payable January 1,

under the direction of Warren

65

Broadway, New York 6, N.

Y.

Secretary
ISNNISSII

CO«rO*AIIOf»

CORPORATION

IMTERNATIONAL

Office

November 19, 1959

SHOE

& Co. has opened a branch
in the Professional Bldg.
the

management

of

CASH DIVIDEND

Secretary-

Crowder,

L.

Treasurer.

COMPANY

CITY,

Mo.

—

Owen, Jr. has joined the

Loyd C.

per

195™

Mr.

Owen

Burke and MacDonald.

was

(31M

cents

declared

pay
1959, to

close of business

December

3, 1959.

Common Stock
EXTRA

A

quarterly dividend of

share

payable

at the

on

A5i

11, 1959, was

the Board of

An

per

January 1#
of record

close of business Decem¬

declared by

Directors.

DIVIDEND

CASH

extra

dividend

of

twelve and one'half (12 3^)
per share was declared
payable January 8, 1960, to
stockholders of record at the
close of, business December

cents

3, 1959.

staff of

Stock
Exchanges.
was
formerly
with

Midwest

share

stockholders of record at the

CONSECUTIVE DIVIDEND

ROBERT

.xO. Peet & Co., 23 West Tenth
:et, members of the New York

and

and one'quarter

able December 18,

1960 to stockholders

Joins H. O. Peet

of thirty-one

A dividend

H.

ber

O.

1960

December 11, 1959.

H. B. Pierce,

(Special to The Financial Chronicle)

_

the

Shef¬

C.

(Special to The Financial Chronicle)

Mo.—Edward D. Jones
branch office"
South Jefferson
Street

on

24,
stockholders of record at the

the

SACRAMENTO, Calif. — Superior
California Mortgage and Develop¬

Floyd

share

December

payable

Form Investment Co.

of

Opens Branch

cents a

$2.70 PREFERRED STOCK

dcnd of 30if. per

close of business

Corporation is engaging in a
securities business from offices in
the J Building. Officers are Clar¬
ence
H.
Pease,
President, and

Co. has opened a

Mclntyre.

67V2

COMMON DIVIDEND No. 334

tors,

ment

E. D. Jones

106a

Payable December 24, 1959

meeting of the Board of Direc

St. Louis

George A. Brechnitz.

at

share

TENNESSEE

meyer

Branch

BELLEVILLE, 111. —/Edward D.
Jones & Co. has opened a branch
office in the Commercial Build¬

&

cents a

the COMMON STOCK

on

BOZEMAN, Mont.—Wm. H. Tegt¬

under

J.—Bonded Plan¬
Corporation has opened a

MEXICO,

Record Date December 15, 1959

branch

a

Alfred

New Tegtmeyer

TEANECK, N.

under

Company

Final Quarter Dividends

SWEARINGEN,

5, N. Y.

Packing Company

Conn.—Sheffield &

has

management

Lawrence

Bonded Planning

ing

M.

Diversified Closed-End
Investment

Calif.—Law¬

HILLS,

office

A

field.

Rappee is conducting a se¬
curities business from offices at

branch

extra

57

1959, to

Sheffield Opens Office

rence

ning

an

The Garlock

Company,

office at 75 Pearl Street under

Rappee Forms Co.

&

declared

Board

the

120 Broadway, New York

C.

Harley

of

ment of Arnold A.

HARTFORD,

(Special to The Financial Ciikonicle)

firm

or

No.

the

WILLIAMSPORT, Pa. — Schmidt,
Roberts & Parke have opened a
branch office in the First National

Company

North

to

194,
for
the
year
1959,
of
Cents
(25c)
per
share, on the
Common Capital Stock of the Company, payable
January 8, 1960,
to stockholders of record at
the close of business December 4, 1959.
dividend.

"

by Thomas Graham, The Bankers

the

1960,

1,

said Comman Capital Stock regis¬
the books
of the Company at the
business January 29,
1960.

Schmidt, Roberts Branch

1960

324

March

payable

Company,

on

East

224

at

1959.

18,

Sec'y-Treas.

Assistant Treasurer.

—

Boulevard

ATKINS,

B.

fjri-foordinen fat

of

holders

R.

Powell,
Powell, Inc. has opened
Nev.

December

record

—December 2, 1959

commission

Bond

at the close of business

Board
also
declared
on
this
day a
dividend of Thirty Cents (30c) per share, being
Dividend No. 195, on the Common Capital Stock

Twenty-five

VEGAS,

KANSAS

New A. C. Allyn

of the Company
December 31, 1959.

O. M0NNI3

John G. Greenburgh

Vice-Preiident and Treasurer

61
1959

Treasurer.

Broadway

New York 6.
December 1,

&

7%

the

on

payable January 8, I960, to

C.

Directors has this day declared
a
dividend
of
Twenty-five Cents (25c) per
share, being Dividend No. 122, on the Preferred
Capital Stock of this Company, payable Febru¬
ary
1, 1960, out of undivided net profits for
the year ended
June 30, 1959, to holders of
said Preferred Capital Stock registered on the
books

Opens

of

stockholders

1959.

Y., November 24,

share

per

The Board of

Hawkins.

Jones Branch

Personal Investors Co. is engaging
47-05

New Jones Branch

ar-

the

The

Perconal Investors

at

Pacific

$1.75

declared

has

Directors

of

of

Preferred Stock

TOPEKA AND
RAILWAY COMPANY

FE

York, N.

The

management

on

Vergano.

securities

Co., Inc., 333 Pine

members of the
Coast Stock Exchange.
Street,

Charleston

campaign.

under

Bernacki to partnership.

a

SANTA

Board

dividend

ATCHISON,

THE

New

Calif.—Harold
Dawson has joined the staff of

I. L. Brooks &

a

WAGNER BAKING
The

Johnson &

&

ngements

for

accountant in the

an

CORPORATION

fi¬

nancial

as

Powell, Johnson Office

Kaplan Partner

Kaplan & Co., 120 Broad¬
way, New York City, members of
the New York Stock
Exchange,

in

City

Douglas Anderson.

John H.

fices

Shaw

DIVIDEND NOTICES

SAN FRANCISCO,

LAS

in

staff

his

Rappee

2

the

Boschert.

as a spe¬

cial Colonel

coming to Miami in 1926,
entered the employ of

After

(Special to The Financial Chronicle)

H.

DIVIDEND NOTICES

organization are at 70 Pine Street.

are

office at

with

Jan.

Partners

^

larger assignments throughout the
York
City
country.
The
New
headquarters
of the
consulting

Mr.

under the direction of Donald W.

BEVERLY

Annual Financial Report—U.

on

City.

was

Kohn & Co.

addition, Mr. Ramsey said, Mr.
will work
on
the firm's

Barsky and Murray Mal-

Harold

Jones

T.

P.

Energy Commission

Atomic

To Be

York

He

office

Florida

new

offices

New York City.
formerly with Richard E.

at 120 Broadway,

George N. Shaw

manage

engaging in

Shaw

St.,

commissioned

Enterprise

request).

S.

New

In

en¬

10 West 33rd

at

Opens

is

business from

securities

First
National Bank Building in Miami.

business

fraternity

Association, Washington, D. C.
(paper), $1.00 (quantity prices
U.

offices

is

Co.

securities

a

a

Shaw

Aibel

M.

which will be located in the

In¬

McGovern

Investments

in

from

ST.

stment

n v e

Richmond,

O. Box 14,

Title

gaging

Herbert

Ramsey's

Form Planned Investments
Planned

H. M. Aibel

an¬

Wainwright &

firm

the

under

L.

liam D. Clark.

Ram-

has

will

Opens

of

Kentucky, a
p a rt n e r
in

Western

request—Investment Associates,

and

Place

Place under the direction of Wil¬

nounced.

„

John

of

City

capacity until 1942, when he be¬
came
City
Manager
of
Coral
Gables. In October, 1945, he re¬
signed from his Coral Gables of¬

Chair-

Joins I. L. Brooks

Life In¬

all

y,

man

inofsky.

Bond Club.

Company) available on

National

ing

s e

vestment Co.

who

American

the

He is also

the

of

Presi¬

-

Basil

business from offices at 5060 West

name

of

in that dual

Cons. Investors Office

a

as

c.,

J.

Colo. — John L. Mc¬
Govern is conducting a securities
Moncrieff

continued

MACON, Ga. — Consolidated In¬
vestors, Incorporated has opened
a
branch ofice at 570 Inglewood

dent, effective
Jan.
2,
1960,

DENVER,

Navy, Mr. Gannon

Post of

gion.

veteran

I

officer

finance

is

,

lor semi-monthly publica¬
tion—Current issue (containing

Estate

Presi¬
Secre¬

J. L. McGovern

year

P.

Lloyd,

n

Vice

1957.

honor

"

.

panies—$15

Real

I

S. Miller

He

con¬

Ramsey,

Mr.

a

Kentucky in the last week of
his term of office as a special

$10.00.

and

Robert

Coral

of

of Miami.

—

tary-Treasurer.

with

1935

Birnbaum

as

Peter

been

has

since

trader

firms

ciated

He

1917.

Jackson
Place,
6, D. C.
(cloth),

Profit Situations in Smaller Com¬

surance

Clayton

are

and

for¬

and

years

municipal

financial

&
.

City

fice to accept the appointment as
Director of Finance of the City

Hornblower &

B. Chandler of the Commonwealth

722

Washington

reports

Co.

and

C.

Clerk.

sulting firm,
of Wainwright

Co.

the

combined with the office

George N. Shaw,
municipal finance

many

by

Gables in 1929, he was appointed
to that post, which in 1931 was

City of Miami,

Lloyd,
is engaging in a
D.

the
was

the

Connecticut Ave., N. W. Of¬

1343

Wall

in

Brookings In¬

The

—

stitution,

Miller

Re¬

Expedience—Corwin D.

Edwards

of In--

Lloyd Miller Co

Department.

Fla., will join

securities business from offices at

Half

First

The

Power:

Century of Bodine Electric Co.
—Howard
F.. Bennett—Apple-

view of

G.

securities

name

for

(paper).

Juan, P. R.
Precision

the

of

Congress

86th

the

United

Committee

Economic

Joint

the

Form

u m,

Street

Lester F. Gannon

Jim

—

a

Securities

WASHINGTON,

Gannon

began
reer

Employment,

Wages,

h

c

the firm

under

ternational

President.

—

Rico, San Juan, Puerto Rico.

in

t

e

conducting

was

Stanley

Special report — Government
Development Bank for Puerto

Increases

it

announced

K

<

Commonwealth of Puerto Rico

Inc., 76
Street,

Y.,

is

business from offices at 1126 Sixth

&

um

Beaver

of Finland

Bank

Abbee

R.

Ave.

Inc.,
261
"Madison
New York 16, N. Y.

Research,

t

Stanley

Alaska

FAIRBANKS,

securities firm
of

When

merly Director of Finance of the

investment
Average

—

in

47

office of Director of Finance
created

Gap Road under the firm

with

was

J.

N.

Finance

Geo. Shaw to Join

of Feren & Co. In the past he

name

Manager

become

:

is

business from

Manager of the New York of¬

as

(2443)

N. Y.

48

Financial Chronicle

The Commercial and

(2444)

...

..Thursday, December 10, 195y

1BA Elects Lee

WASHINGTON AND YOU

As New

BEHIND-THE-SCENES INTERPRETATIONS
FROM THE NATION'S CAPITAL

James

J.

Hutton

&

partner

Co.,

investment

Federal
their

some

ployment

Practically all of the banks
worrying about
inflation

that

affects

and

child

instance

ing

old

subject, but

every

in

man,

this

rise

in

all the

see

aspects of the situa-

tion. It would take

tremendous

a

and

stability.

of

the

An

New

less there

services

is

growing

panding,

out

.

market

.

effect

interest rates. And this

on

could

buying to have that
be

not

done

without

in¬

flation."
Each

services

of

market
purchases of Government bonds

by

the Federal

available

Reserve

about

additional

open

six

loans

for

investment,
inflationary

or

tremendous

a

makes

dollars

factor.

Many

headaches

when the
tem

Federal Reserve

interest

pegged

government
and

after

rates

Bank

out

Review,"

War

in

hut

blanket

of

"1 if

the

view,

St.

"it

the

price,

wage,

of

the

inflationary

were

acceptable,"

Louis

Bank's

Re¬

is

doubtful

whether

Reserve

System
rates
on

interest

peg

Government
normal

obligations

bonds

and

other

fixed

in

income

obligations into stocks and other
equities."
Omaha

Now

the

Out

in

Reserve

ital.

the

for

Seventh

is

cial

the

of

one

slaughter

as

well

center

for

hogs in recent

as

The

closing
down
of
slaughtering plants on the Chi¬
cago

Southside

focus

the

steady

brought
into
evolution in

the location of livestock
produc¬
tion and slaughter.
The
*

basic

Rank
reason

explains
for

the

the

that

decline

in

relative importance of livestock

markets

plants

and

located

major

•

the

was

meat
at

a

packing

number

railroad

introduction

of

terminals
of

the

gmotor truck and the expanding
isystem of highways. Thus, live¬
stock farmers were no longer
"tied" to the railroads for

mov¬

ing their livestock to market.

"New

England

rich

plus

Business

Reserve Bank of Boston,
peer¬
ing
into the future, declares:

England will continue to
highly industrial region in

the future because of
its lack of
natural resources and
because of




compared

with

average

and

petroleum

cost

14.3%

Third

of

the

of

the

and loan associations.

stitutions,

In

organized

the

the

noted

result

of

the

the

Booming

Petroleum

strike
in

pur¬

generally
in
Montana,
North
Dakota, South Dakota and Min¬
from

emerged

the

result

a

1958

many

farmers have been able to draw
to

reserves

meet

Alger

Central

J.

National

States Group:

Edde K.

Hays, Dean Witter & Co., Chicago,
Erwin

and

Peabody

A.

Stuebner, Kidder,
Co., Chicago.

&

Eastern

Pennsylvania

Group:

•

Harley L. Rankin, Goldman, Sachs
& Co.. Philadelphia.

Mississippi

crop year in excellent financial

As

Group:

Jacobs,
Crocker-Anglo
Bank, San Francisco.

Jerome

F.

Group:

Valley

Tegeler,

Dempsey-

Tegeler & Co., St. Louis.

commit¬

New England Group: Thomas B.

Hornblower

Gannett,

Re¬
of

one
on

was

hand

flect the "behind the scene"

the

and

one

of the

North

Virginia

own

Weeks,

&

furniture.

This

area

ing

come

Reserve

Minneapolis

as

a

of

As

in the dis¬

Federal

trend

was

in

duction

in

substantial.

with

in

the

result

of

to Hear

Ohio —H.

Vice-Presi¬

Cleveland

North

Dakota

will

the

Stuart

Cliffs

address

Cleveland

the

Iron

was

Montana fared bet¬

C.

Co., New York.

&

Northwest Group;

Phillips,
Southeastern

York

Society of
10.

1

admitted to

City,

52

Boyce,

&

Bros.

Baltimore.
Southern

1

the

firm

name

Group:

Alexander

phrey Company, Inc., Atlanta.
of

Stock

Exchange

was

& Co.

Texas

Group:

Moroney,

Moroney,

Louis W.

Complete

The

Parrillo

was

partnership in Verace
Broadway,

members

of

New

the

York

Robert

E-

Beissner

&

Co., Houston.

Convention

Verace Co. Admits

Co.,

LeRoy A.

Group:

Stein

coverage
will

"CHRONICLE"

&

Josef

Northwest

Pacific

Company, Seattle.
Wilbur,

Be Kerbs Co.

to

Dec.

Dec.

Co., New York,

Sherburne, Bacon,

H.

Yearley, IV, The Robinson-Hum¬

changed to Kerbs

On

Scott

W.

Group:

meet¬

of

South Dakota, and

Harold

Pacific

Kerbs, Haney & Co., 39 Broadway,
New York
City, members of the
New

York

Harriman Ripley & Co.,
Inc., New York; Cushman McGee,

Cluett,

R. W. Pressprich &

views.]

Executive

of

Name

important in the production

of

New

inter¬

Whipple

Harrison,
dent

is

upholstered furniture.

the

re¬

Capital

coincide

Analysts

the

are

the impact of reduced
crop pro¬

lines in the district of the
Fed¬
Reserve Bank
of
Dallas.

not

may

CLEVELAND,

drought and mining shutdowns.

75,603
miles of petroleum
pipelines and
118,150 miles of natural gas-

or

Cleve.

ma¬

The sharpest decline in farm in¬

were

may

the "Chronicle's"

Security Analysts, Dec.

of

to

furniture

recession.

and

national

concentrations are in Texa
a,
Louisiana and Oklahoma.

intended

pretation from the nation's

autumn tended to lag behind the

criss-cross much of
Southwest.
The
greatest

is

tion, making almost 50% of the
dining room and bedroom

trict

gas

column

the

bituminous

Business recovery

of

[This

Boston.

and

other

1957-58

Bank

there

their

leading
producers
of
wood
household furniture in the Na¬

of

years,

natural

1

reduced

Company

also

pipelines

1957

the

wooden

Southwest
and

have

ers

1959* Con¬

the

are:

California

chases of automobiles and larger
household items such
as
fur¬
niture and appliances. Farmers

mining.

Carolina

Dis¬

series

a

jor pace-setters in the recovery
of the District
economy from

These in¬

a

that

effects

making has been

re¬

historical factors.

In

Bank

serious"

coal

savings

the

over

terms.

took office at

vention

small decline.

a

ments.

Richmond, the Federal

serve

them small

of

many

consecutive

incoming Governors elected
their respective Groims and

'

Nation's

country's

cur¬

Reports From Other Areas

decline

the

the outlook for

on

manufacturing where
produced, oil refined,

are

the

of

marked

Within

for

term, Mr. Cro¬
Glassmeyer for

Mr.

ex¬

bankers, particularly
the Dakotas, said farm¬

those in

in

during this year at
nearly 1,500,000,000.

of
high
grade
rivers and rails and

woven,

1957

of 54,563

the

income

District

struction

steel

are

perienced

farm

as

condition.

lengthy

textiles

in

Minnesota's

nesota

soil,

Coast

and

second

whole than the Dakotas.

as a

than 10,000 miles of natural
gas
pipelines are scheduled for con¬

with

East

5,014

pipelines,

areas

this

1958

rent boom in the construction of
natural gas pipelines
may con¬
tinue for several years.
More

fertile

in

people.

an

In contrast to

Third Reserve District houses
almost 5V2%. of
the
Nation's

The

at

On

Here

in

and

ports.

trict

constructed

ter

1952-56.

deposits

coal,

of the

in

appear

of

Dec.

17,

Convention

1960

Association

will

Hollywood

Beach

be

of

held

Hotel,

at

1959
the
1959.
the
the

Holly¬

wood, Florida, Nov. 27 to Dec.

American

Stock Exchange.

Attention Brokers and Dealers:

eral

TRADING

Texas, Louisiana, New Mexico
and

Oklahoma

are

the

largest

Indian Head
Official

Since World War II about 75
petrochemical plants have been

established,
been

and

most

Theodore

writing
view"

Bank

R.

in
of

of

constructed

crude

is

the

oil

them

in

the

area, said

the

Federal

„

Carl Marks

rate
and

20 BROAD

TEL:

said

it

appears

of

expansion of
refine pipelines

slowing markedly. Few major

Our

&

Co Inc.

New

York

telephone number JS

CAnal

6-3840

FOREIGN SECURITIES
SPECIALISTS

Reserve

Dallas,

Mills

Films

Southeastern Pub. Serv.

Eck, an economist
the
"Business Re¬

However, he
that

of

MARKETS

Botany Industries

exporters of natural gas
among
the states.

"New
a

richest,

forests,

it if there's
bedding?"

elected

was

well

by

were

pride

Nation's

Texas-Louisiana Gulf

Review," issued by the Federal

be

with

District

endowed

have

New England's Future
The

the

a
job!'—Can I help
in my specialty—feather

petroleum pipelines
are
currently
under
construction;
4,127 miles of new pipelines

of the

Reserve

abundant

are

cattle

points

Get

open

new

Philadelphia

naturally

has

leading

the middle

Third

job!

a

nothing

Federal Reserve Bank of

Philadelphia
is

'Get

Aclams

consecutive

who

in¬

important regional finan¬
center today.

The

and

years.

life

an

District

points out that Omaha
replaced
Chicago as the

"

estab¬

were

mutual

Nonetheless,

assets

Chicago, the Federal
Bank

H.

The

savings and lean 'associations.
They hold only 4V2% of the

Leading

Slaughter Center

Adams, Braun, BosCompany, Detroit; War¬
Crowell, Crowell, Weedon

third

In

19th century Philadelphia was
giving ground rapidly to New
York, the Nation's financial cap¬

is

investment

City

first

But before

under

further diversion of

M.

Co.,
Los
Angeles;
Edward
Glassmeyer, Blyth & Co., Inc.,
New York;
George O. Shepard,
Prescott,
Shepard
&
Co., Inc.,

1831.

steel

a

James j. Lee

&

Mr.

1791 and .1816; the first mutual
savings bank, 1816, and the first
savings
and
loan
association,

inflationary influence would
from

c e-

&

Third

the

1781;
the
First
and
Second
Banks of the United States,

of

accelerate

-hf

and

company, 1769; the first
chartered
commercial
ban k,

gion

savings

the

the

conditions.

peacetime

Asso¬

William

all

surance

that

Federal

could

The

in¬

Quaker

lished

the

control.

consequences

said

"Monthly
under

direct

materials

Louis

dangerous

a

developed

"Even

The

St.

of

its

flation

and

during
II.

,

also

V i

worth

Reserve District

on

held down, the Fed¬

Reserve

pointed

Sys¬

rates

obligations

World

were

eral

developed

r

Cleveland.

Philadelphia

the

dollar

r

sidents:

re

ren

kinds."

Philadelphia, in the 18th and
early 19th centuries was the fi¬

of

e

elected

ex¬

an

nancial center of the Nation.

engine

K

.

for

suc¬

William

five
P

industrial

System

an

He

The

un¬

"converting the Federal Reserve
into

Associa¬

tion.

ciation

TJie high per cap¬
ita incomes which New England
residents enjoy provide a large
.

the

Whipp 1 e
&
Co.,
Chicago.

increase

of

elect/,!

IiwpJ

the

Bacon,

amount of open market Govern¬
ment bond

at

D.

England

healthy,

r

Citv

Partner,

demand for their

a

W

was

Annual

govern¬

On the other hand,

...

economy.

However," those urging such a
far-reaching step have failed to
^

services

velop to their fullest extent

interest

of

America

ceeds

dependent

the service industries cannot de¬

buying of Government bonds
support bond prices and thus
the

therefore,

seem,

give the region greater

economy.

the

restrain

the

health

members of Congress,
continuing to urge the Fed¬

rates.

would

dustries has implications for the

includ¬

Association

Convention of

income

eral Reserve Board to authorize
to

em¬

in employment in the service in-

For

some

are

in

manufacturing

would

upon

woman

people,

many

shift

a

of

in

York

Bankers

skilled

to

ment to

one

country.

But

from

that New England is

are

an

highly

the

"It

economy.

which is

of

non-manufacturing industries
help to alleviate the in¬
stability of employment.

per-

these

days.

the

supply

manpower.

the

They are noting
important things that af¬

some

fect

and

across

observations

autumn

its

The

—

Banks

banks

making

are

tinent

C.

Reserve

branch

nation
.

D.

New

bankers,

President

WASHINGTON,

President

Lee,

STREET

HANOVER 2-0050

•

NEW YORK 5, N. Y.

TELETYPE NY 1-971

LERRER S 00.
Investment

10 Post Office
Telephone
HUbbard

Securities

Square, Boston 9, Ma^s
Teletype

2-l9!)0

2.