Full text of Commercial and Financial Chronicle : December 13, 1956, Vol. 184, No. 5594, Section 1

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In 2 Sections

INVESTMENT BANKERS ASSOCIATION CONVENTION ISSUE

The Commercial w

17

DEC

v

l®8

Reg. U. a, Pat. Office

Volume

New York

Number 5594

184

EDITORIAL

Reserve

We See It

As
Two current

topics

wherever two
the

of

name

three

or

are

McCIIESNEY

WILLIAM

By

gathered together in

Chairman

problem of foreign aid, particularly to Britain
definitely related and

appears

credit

to be going out of its way to
Britain and France that there are no hard
now

tion

far

are

robin.

cock

killed

who

about

It

argument
is apparently

Congress

we

as

it,

over

placed

has

Reserve

deserves

of

our

say

nor

hearings

It

would

be

The

that

they were left to stew in their own juices, or so
it seems to us. The trouble is, of course, that our
welfare,

own

even

our

own

safety,

may

in-

depend

their

W. McC. Martin,

the

available in

be made

without

gear—but

credit

much

over¬

would

in¬

upward pressures on prices.
could
needlessly starve

little

some

activities.

have

We

to

There

rely

succeeds
Partner

on

human judgments

Continued

95

Stabilization

of

the

Martin before

Joint

Economic

The five Vice-Presidents elected

Fla.,

DEALERS

appear

H.

Robert

Craft

cago;

page

109

Dec.

11,

William S. Hughes, Wagenseller & Durst,

William H.
Incorporated, New

Mead, Miller & Co., Baltimore; and

Morton, W. H. Morton & Co.,
York.
'
\V
THE

NEW

.•

PRESIDENT

Mr. Craft has devoted his entire
to the field of finance.

He

was

Continued

of America

State, Municipal

0

UNDERWRITERS

Municipal

LATEST

TODAY'S

INVESTMENT
S EC U R I T I ES

ARE

corn exchange
THE FIRST NATIONAL CITY BANK

Burnham and
MEMBERS NEW YORK ANO

15 BROAD STREET,
CABLE:

OF NEW YORK

Company

AMERICAN STOCK EXCHANGES

NEW YORK 5, N.Y.

•

014-1400

Dept. Teletype: NY 1-708

Bond

T. L.Watson &.Co.
ESTABLISHED

Exchange

Stock

Exchange

bank

Orders

Executed On

Canadian Exchanges At

CANADIAN

STREET

DIRECT

WIRES TO

•

PERTH AMBOY

Analysis
oar

Regular Rates

NEW

YORK

request to

Dept,

(Room 707)

Pomduoh Securities

MONTREAL AND TORONTO

1 NORTH LA SALLE ST.
CHICAGO

upon

Unlisted Trading

DEPARTMENT

GRP ORATION

Goodbody a Co:
115 BROADWAY

Corporation

BONDS & STOCKS
All

MEMBERS NEW YORK STOCK EXCHANGE

BRIDGEPORT

Knox

Class A Common Stock

Teletype NY 1-2270

BROAD

NEW YORK 4, N. Y.




Chase Manhattan

coast to coast

CANADIAN

SECURITIES

District Bonds

gcutAuf&t COMPANY

34 offices from

Exchange

YORK 5

Markets Maintained

CANADIAN
Commission

New York Stock

FIRST

Stock

1832

Members

25

York

Dealers, Banks and Brokers

To

American

New

TELETYPE NY I-2ZS2

COBURNHAM

Countv and

THE

Harris, Upiiam & C5
Members

DEPARTMENT

BOND

REQUEST

120 BROADWAY, NEW

Net Active

State, Municipal,

INVESTOR"

NOW AVAILABLE
ON

BANK
30 BROAD ST., N.Y

Bonds and Notes

"POCKET GUIDE FOR

of

CHEMICAL

Public Housing Agency

COPIES OF OUR

DISTRIBUTORS

HAnover 2-3700

DEPARTMENT

60

and

Securities

BOND

page

Convention
Hollywood,

in Section Two of today's issue.

and

X\

on

1956.

U. S. Government,

telephone:

business career

born (Feb. 9,1906)

in

State and

Baird, A. G.

Incorporated, Chi¬

Inc., Los Angeles; William C. Jackson, Jr., First
Southwest Company, Dallas; W. Carroll Mead,

the Subcommittee on Economic
Committee

M.

Andrew

were:

Becker & Co.

photos taken during the 45th Annual
at Hollywood Beach Hotel,

PICTURES—Candid

Investment Bankers Association

on

Craft

George W. Davis, a
of Davis, Skaggs & Co.,

San Francisco investment firm.

bound to be differences

are

Bank,

President

Bank.

hattan

Reserve

Too

in this determination.

CONVENTION

IBA

of

page

to

Chase

The

en¬

Craft,

H.

Robert

wholly-owned foreign financing
subsidiary of The Chase Man¬

Federal

keep the economy running

to

high

Too

""Testimony by Mr.
on

Federal

the

of

task

President for the

year
President of

we

tensify

Jr.

greatly inclined to take full advantage
presumed indispensability. That, howContinued

The

times.

provides that

as

suing

good.

strain.

retaining them as allies. Another trouble
is, obviously, that they are too well convinced
that we can hardly do without them and are
of

Act

needs

order

upon

much too

the

to

The Association

25 to 30.

elected

System, under today's conditions, is
to determine the volume of credit

if

poetic justice

all

is

the

place, the Hollywood Beach
Hollywood, Fla., from

Nov.

public

a

of

Convention

Hotel,

shall
report directly to Congress and thus,
through it, to the country.

country the courtesy of informing us of their
actions.

that

the

of

Reserve

only got themselves into a mess against our
best advice, but have done so without even doing
intended

merely

not

are

abreast

have

not

this

usual

They provide a means of keeping the
monetary machinery of the country

France

substance gratis. They

the

at

The Reserve System has always bene¬
fitted from thoughtful inquiry. These

money.

plainly that so

Britain

neither

see

can

more

we

held

great responsibility upon the
trusteeship, as I conceive

a

Annual

Forty-fifth

this issue.

Investment Bankers Association of America was

System—a

forum—and

requires that

The

through

others have.

some

Candor
far

allocation

Federal

prepared, moreover, to translate this feeling into
tangible aid and in very substantial amounts
although it has not gone overboard on the matter,
as

ments, are presented in

"tightness" to demand intensity, and focuses atten¬
our
heritage and institutions which call for

market process rather than
selective credit "judgments — or guesses — of public
authorities." Says present conditions call for alertness,
as well as prudence and restraint.

than

important

more

also Committee

on

credit

feelings about by-gone things, and that it believes
future good relations between these two countries
on the one
hand and the United States on the

Texts of these addresses,
Reports and other Convention develop¬

then; and Robert L. Garner.

explains credit easing would compound the threat to
stability and sustained growth. Attributes

constantly borne in mind. The Administra¬

tion

other

George W. Davis; Maj.-Gen. j. Stewart Bragdon; j.
Sinclair Armstrong; Arthur b. Homer; Eugene E. Trefe-

economic

and

assure

incoming President, Robert H. Craft; outgoing President

mass

1953, and, in referring to current inflationary dangers,

if the fact is well understood

be well

would

it

Meeting at Hollywood, Fla., Nov. 25-30, addressed by

one which required
unemployment during 1930's,
Martin defends flexible policies pursued since

the

are

45th Annual Convention

Contrasting today's problem with the
curing overnight of

two

JR.*

MARTIN,

Chairman, Federal Reserve Board

public v/elfare. One of them is the

France. The

Copy

a

The Investment Bankers

Policy During

possibility of serious inflation and the other is
and

Cents

Inflation and Deflation Association of America Holds

favorite themes today

are

40

Price

7, N. Y., Thursday, December 13, 1956

40

Exchange Place, New York 5, N.Y.

Teletype NY 1-702-3

WHitehall 4-8161

IRA HAUPT & CO.
Members New York Stock

and other

111

Exchange

Principal Exchanges

Broadway, N. Y. 6

WOrth 4-6000

Teletype NY 1-2708

2

(2493)

The Commercial and

For Banks, Brokers, Dealers

The

only

For'Over-the-Counter

participate and give their

Try "HANSEATIC"
department,
long experience and broad con¬
tacts can provide prompt, reliable
service as the year-end approaches
tax-switch

come

So

they

•re

be regarded,

to

GEORGE

increasingly important.

over

sues—jet "Hanseatic"
Just give

go to

work

Established
Associate

1920

PHILADELPHIA

SAN

•

Wires

to

the

Since 1917

I
S
e=s

the most
highly stylized cars on the market.
Not only should the 1957 models
prove
extremely successful but
re-establish

"McDonnell &fo. \
Memoers

§|
§=

Exchange

gs

mous

g

pletely centralized organization. It
has

TEL. REctor 2-7815

divisions rather than

division

styling

its

realigned

com¬

a

with

emphasis upon design as well
engineering. It has mod¬
ernized, improved and integrated
its manufacturing operations and
it has strengthened its dealer or¬
ganization. Changes of this nature

III!

as

Trading Interest In

American

Furniture

-

.

;

upon

take time to be reflected in opera¬
o

Bassett Furniture Industries

tions

and

should

1957

fruition

record

begin

these

of

to

develop¬

ments.

Commonwealth Natural Gas
Life Insurance Co. of Va.
A

addition, Chrysler plans to
spend $1 billion on capital im¬
provements in the years 1956 to
This

intends to

STRADER and COMPANY, Inc.
Lynchburg, Va.
LD 39

TWX LY 77

that

Chrysler
regain its former posi¬
means

tion

in

to

the

heights along with
expanding characteristics of

the

industry

the automotive world

to

go

The

trend toward suburban

the

multi-billion

OVER-THE-COUNTER

lion

Estate Liquidations
a

Specialty

the

ESTABLISHED

1929

Tel. HAnover 2-4850

to

3%

Bfreene<m4Gompami

of

that

its

capitalization

General

Motors

and

share of

common

Chrysler

tive

sales

likely,

Block

—

Quoted

Offerings Wanted

for

Ford

and

only

still

more,

in

addition

margin

It

seems

attain

a

keeping

competitors,

share will record

per

is

as

in

more

with that of its

ings

improve its rela¬

earn¬

a

sen¬

rise.
true

that

Chrysler cannot

profit

margins

en¬

which average
and

CAPPER & CO.
1 Exchange PI., Jersey City, N. J.

14%

This,
enjoy

HEnderson 2-8570—N.Y.s Olgby 9-3424

Teletype JCY 119




pre-tax,

because

and
to

It would

respectively.

Chrysler

operations

grated
close

approximately 18%

so

assembly

major
seem

does

fully

not

inte¬

plants

marketing

as

areas.

altogether possible,

New Orleans, La. -

im¬

and vegetable

December,
started
l^bel

to

of

1956

Florida

STOCKS

and

an

When

line

will

about

and

it.

citrus

been

juices

added,

have

fully

For

Call

the

Hawaiian Pineapple

Company

currently
these

will

be

the

company's

What kind of juice do
you drink
before your
morning coffee?
If
you are a 55% average
American,
down

you

juice;

if

of

orange

you

a

in

are

beaker

a

25%

in

at

Firm

a

will

be

for

cans.

and

difficulties

more

be

opera¬

delivers

on

are

economical

operations

Marketing

b 1

n r o

s/in

e m

In

view

to

Dr.

sales

Everett

a

J.

Mann

sales

there

surge

of

tremendous

po¬

increase

pineapple

in

juice,

production under the Dole
plus that of other pineapple

derivatives such

rings,

and

chunks,

as

pie

of

a

filling,

the

spears,

for

HAPCO's

.

shows

,neat

10

record

of

a

earnings

j

year

$1.72

for the fiscal years
ending May 31,
to

1955

make

rather

10%

sales

figures

investor

the

1956

fiscal year,

searching for under¬

valued situations in what
an

overvalued

market.

may
In

be

that

latest year, HAPCO's sales of $72
million

were

22%

up

those

over

of. the previous vear while
profits

galloped in
less

than

price
value
of

of
of

at

SI.64

a

share,

eight times the
13.

An

$25.70

or

at

present

impressive book
lies

these low-cost

behind

common

».•

WISENER

COMPANY

and

UMIT2D

73 Klnf St. West

—

Toronto, Canada

In

cents

thrpe

dends

N. Y.

SUGAR

added.

consists

Raw

—

Refined

Liquid

—

Gr

noct

Exports—Imports

Futures

divi¬

$1.10.
<*%

a

the

10-year

a vera

shares

mon

STREET

the

dividends

during

while

have

ization

WALL

NEW YORK 5,

e-vneri-

nosi+ion.

paid

ppntember io"$
vvas

through

creates]

shar*

a

99

1

djfPeuUy

Hghlv

a

has

yeat:S

dend

this

LAMBORN & CO., Inc.

past

^t.oe1'

Tri
DIgby 4-2727

divi¬

Eouity capital¬

of

1.650.000

preceded "by

com¬

20,7?$

preferred and $10,400,000 of longterm debt.
The

astute

become

dend
of 20

vvo

with! 3%

Fms

divi¬

yields., price-earnings rat'os
or

better, and who wants

growth

stock

counted

its

10

investor

jaundiced

which

a

/ lil

£

dis¬

notential for.ithe next

might

years,

hasn't

find

some

un-

shares,

a

start to intrigue

may

80

years,

range around a median of $55

For

•

Director of Market-

as

HAPCO

stunted

volume varied scarcely in

million.

oc

ncwlv

a

but

redressed

in<*.

unex¬

citing reading. During those
sales

been

man

the
busi¬

share, although its sales figures

1949

desired,

employment

pineapple

market

vertical

frozen

of:

whose

development.

enced

what

a

be

has

-

in

for

restraining

companv's sales man¬
agement may have left southing

juice if only 2% of todav's orange
juice -drinkers
suddenly
shifted
their preference to
pineapple.
is

factors

the

years,

the above sta¬

There

been

HAPCO's

of

*";

the

have

•

'

can

highly competitive juice industry",'

pick-me-up.

Common Stock
1

expected.

9% minority
will reach for

pineapple
juice as a postnoctum a'l

/

overcome,

prune whereas
a

DELHI

the

machinery penalized
ehno^mally; once these

earnings
initial

o r

no

—

PETROLEUM, LTD.
■

of this

will

like

Trading Market j

Maintained in

CANADIAN

en¬

Duripg

delav^d

.

Branches

Bankers

can

turning out HAPCO's

need

tions

other

70

.

tire

some

choose

A

plant has been built in
Honolulu which, within a year,

nast fiscal year, starting

group,you

grapefruit

plants.

1897

—

Investment

over¬

working

making

prefer tomato;
11%
of you
some

its

<k

added

checks in

now

Co., Ltd.

Tokyo

the

To cut down costs, the
company
moving into some vertical in¬

is

Office

Broadway,N.Y.6 COrtlandt7-5681

studying
with

feasible without

tegration

write

Established
Home

look

spanking 2.6 ratio.

Emory University, Atlanta, Ga.

-

economy.

Yamaichi

firmlv

a

packed

products

that

straining

'

information

or

Securities

111

is

as

current

Brokers

new

soon

improved Japanese

Dole

T

HAPCO

as

to

company

under the

frozen

have

Dole

fruit

juices, made in
independent pro¬

fruits

rounded

the

remaining at practically
stationary levels for three years
now appear to
be stirring due

fruit

by

ducer.

the

offices

after

canning business. In

market

citrus

branch

our

JAPANESE

more

fields

in

to

com¬

moved

owned .subsidiaries

wires

one-

this

allied

.NY 1-1557

Birmingham, Ala.

Mobile, Ala.
Direct

,.

the

the

approach

has

in

capital which

compared

joyed by General Motors and Ford,

Inquiries invited

MANN

stock in 1955

$398.00

can

and

sational

Bought — Sold

J.

Administration

average

$104.00

profit

INDUSTRIALS

EVERETT

HAPCO
to

New York Stock
Exchange
American Stock Exchange
19 Rector St., New York lf N. Y«

Members

In November,
1955, the
acquired on highly fa¬
terms two
new
wholly-

vorable

York

ness.

per

aggressively

other

Chrysler sales

$45.00 for General Motors. Surely,

MINING, OILS,

The

New

Associate Professor of Business

name,

only

HAPCO

promise
DR.

tential

approximately

risk.

the

on

as¬

Exchange.

be gained from

that of Ford.

amounted

if

LOW-PRICED

Stock

backbone

16%

with

PRIMARY MARKETS I\

businessman's
listed

be

can

that

fact

amounts

some

willing to

a

would

Some idea of the potential exist¬

ing in Chrysler

are

is

ever

registered.

now

for

recommended

stock

think

an

is

primarily by indi¬
seeking appreciation and

tistics,

automotive vehicles upon the roads
over and above that of the 65 mil¬

SECURITIES

37 Wall St.. N. Y.

with

It

therefore

highway

increasing population, should serve
to expand greatly the number of

BLOCKS OF

Appraisals

massive

living and

dollar

together

program,

We will buy

and

new

itself.

apprecia¬

market which may

come.

variety

In

I960.

some

excellent

an

sume

the company has em¬
barked upon a program embracing
reorganization into semi-autono¬

Stock

BROADWAY, NEW YORK B

be

disadvantages

company

starting,

highly selective

recent years,

Exchange

Memoers

endeavor.

upward

only

substantial

stock

a

to

who

During

Chrysler.

available

a

product market and all the

sold

to

Stock

American

of contentment with

year

;

purchase

and

earnings

former

for

tend

also

will

factors

for

to

for

viduals

Chrysler this
has
introduced

is

now

ex¬
new

stock, which
share last

seem

in

time
Astarita

their

per

apparently

remain
C.

George

of

points lower, with the

would

this

dividends

York

which

tion

To

result

The
$100

vehicle

will not

the

as

move

other

of

plies,

in engi¬
neering, but

(

SCRIP

provided,-

years,

reception which might be

above

factor

Steiner, Rouse & Co.*
HAnover 2-0700

$14.

petitive

styling.

are

year

&

Administra¬

years

pected

situation,

RIGHTS

than

the

tops

g

Business

share

per

more

visualize

can

few

that

Specialists in

to

of

tion, Emory University, Atlanta,
Ga. (Page 2)

the economy continues to
expand and its products meet with

are

correct

earnings

amount

writer

course,

Vir¬

cars.

fessor

a

in pineapple sales, HAPCO is also
expanding sales horizontally; after

30

alone

obtain

Quoted

—

In addition to the vertical
growth

products

Cities

1951

it

Bought—Sold
Pineapple

Company
Eyerett J. Mann, Associate Pro¬

than

years

the

less

Should

its

year,

and

sell

&

Springs, Colo.

sibility of some $20 per share
earnings for Chrysler within the

reason

on

all

in

1955.

of

Louisiana Securities

(Page 2)

the pos¬

that Chrysler

FRANCISCO

Principal

for

of

agreement

n

margin

recorded

car

the

tually

CHICAGO

•

6%

has

i

Exchange

C.

next

lack

progress.

Teletype NY 1-40

BOSTON

pre-tax

through

company's
^

Alabama &

Corporation—George

Hawaiian

profit margin of only 7% in 1957,
along with 20% of a IVz million

primarily

a

styling

Broadway, New York 5

WOrth 4-2300

its

could

emphasis

Member

American Stock

ISO

sell the securities discussed.)

to

The

years

call today.

us a

Corporation

New

nor

Thursday, December 13,1955

Selections

Manager, New York
Stock Exchange Dept., Boettcher
& Co., Colorado

however, for it to greatly improve

Chrysler stock has not partici¬
to any appreciable extent

hindered

Private

he,

to

.

Week's

Astarita,

in the great bull market of recent

New York Hanseatic

120

offer

Chrysler

particular security.

a

intended

not

are

pated

400 is¬

that

for you.

as an

ASTARITA

Chrysler Corporation

tax-switches, as with
OTC problem—we make

primary markets in

C.

Manager, N. Y. Stock Exchange Dept.
Boettcher and Company
Colorado Springs, Colo.

be¬

transactions

for

every

for favoring

reasons

(The articles contained in this forum

.

.

Participants and

Their

trading

hirge

and

This

Forum

A continuous forum in
which, each week, a differetft group of experts
In the investment and
advisory field from all sections of the country

Switches

Our

Security I Like Best

f inancial Chronicle

each

growth

Looking forward
years

hence

when

happy Americans
breakfast

juice,

forking

HAPCO's

to the

day five

millions

will be

more

dunking

doughnuts in pineapple

dieting

salad at

in

lgdy

calorie-low

up

Americans

pineapple

lunch, adolescent Ameri¬

cans

Quotation Services
for 42 Years

gobbling pineapple sundaes,

and

Over-the-Counter

robust

Americans
chewing
pineapple pie for dessert, it is not

inconceivable

that

investors

will

National Quotation Bureau
incorporated

pay $40 for the privilege of buy¬

ing

a

Established

share of Hawaiian Pineapple

Company.

The stock is listed

46 Front Street
on

CHICAGO

shares

the San Francisco Stock

Exchange.

1913

New York
SAN

4, N.Y.

FRANCISOO

*

Volume

r.i4

5594

Number

.

The Commercial and Financial Chronicle

.

.

(2499)

\

INDEX

Looking at Our Domestic Economy
Reserve

Middle

the

a

and

East,

counsels

in the domestic economy

that

imperative

program

—Victor

position regarding

our

moderation

and

build

and

excesses

restraint

up

abdicate to the United

to aid Western

Europe's

Nations;

postponing doing too much too fast and

and not lessen the Federal Reserve's
As

I

V

this

with

ject—I

almost

cannot

would

be

is you'll forgive

it

discourse—and

true

sub-

other

any

casting

escape

the

in

world

ening

continue and

the

of

scene

past

few

weeks.

What

happens
that

1957.

scene

better

ques-

about

future: in-

our

eluding

our

economics and
our

money—

whether
Alexander

C.

Henry

tight
dear

have inflation
pursue

of

we

shall
and

prosperous,

economic

temperamental substance. No wonthe philosopiiers

confounds

puzzles us all. But this much
be
predicted with certainty
about money—it
responds sensi-

and
can

lively

and

events

and

quickly to economic
political decisions.

1

Large
economic events
large
political
decisions,

and

grave
making,

living

for

seem

what

basically,

more

shape

is

weather

the

in

be

to

kind
in

of
to

be in

the

economy

our

whatever

may

zooming

beautiful
domestic

picture

of

have

been

fast

too

The

Is

and

the

certainties of
tional situation
tive

that

build

we

all records

do

on'too

business history.

all

are

will

ness

close

*An

address

the

year

at

its

I can read you the
by

Mr.

Alexander before

Municipal
Public

so

The

Oil

•

accelerating
and

loosen
so

more.

present
our

we

If we

wiu

pres¬

t

the

present

int0

=

state

of

interna-

tional affairs, we must not run the

risk of adding an American reces-

D.ec.E7X,T9Me Club °' Ch,c"8°' Chic"s,>•

Continued

on page

Gas

Securities

Companies

Industry

Committee-

46
!

vention

48

Holds 45th

today's

in

appear

Annual

28

<k

the Con¬

Second

page

-

Section.

Convention

32

Convention Dates and Site for 1957

Arthur

Bank

and

Direct IF ires

the

109

120

Recommendations

8

Einzig: "The Defense of Sterling"
From
Washington Ahead of the News—Carlisle
Indications
NSTA
News

Current

of

Activity

16

—

Bankers

and

Banks

Wilfred

Utility

Railroad

The

Now

in

.

Registration

State

and

.

Trade

at

Washington

.1

_■

Best

and

I

Twice

FINANCIAL
Reg. U.
B.

Park

Streete

1
Drapers' Gardens, London,
land, c/o Edwards & Smith.

Weekly

Reentered

Publishers

7,

York

2-9570

to

SEIBERT,

by William
Company

1956

N.

25,

second-class

as

DANA

1942,

at

the

post

Dec.

Dana

office

*

Subscription

Prospectus

TELEPHONE HAnover 24300
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1956
news

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Every

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INCORPORATED

Editor & Publisher

13,

B.

matter

York, N. Y., under the Act of March 8, 1879.

9576

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Thursday,

Jessop Steel

Eng¬

Y.

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WILLIAM

ST., NEW YORK 4, N. Y.

C.

E.

and

"Subscriptions
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3

_

120

COMPANY,
New

United Western Minerals

2

i..

CHRONICLE

DANA

Corp.

16

•

Industry

S. Patent Office

Place,

Lithium

114
100

Wallace

You.

and

COMMERCIAL

HERBERT

110

—

—

You—By

Like

I

Security

The

97

Security Offerings
Corner

.

Revlon*

98

L

Salesman's

Market

The

89
119

i_

:

I

Securities

Prospective

Security

Sulphur

4

...

Securities

Securities

Pan American

18

May

Reporter on Governments
Reporter's* Reo»>rt_.

Our

Public

Sulphur

118

Notes

About

Gulf

6

on

117

Observations—A.
Our

Business

IS

:

Bargei

Funds

Mutual

Los Angeles

23

,

Field..

Investment

Investment

Dealer-Broker

:

Bookshelf

Events j_n

to

*

Cover

Stocks

Insurance

Man's

Business

INC.

Exchange PL, N.Y.

Philadelphia * Chicago

(Editorial)

It

See

REctor

Stock Exchange

96

Regular Features
We

40

Teletype NY 1-1825 & 1-4844

43

Results of Golf Tournaments at IBA Convention

As

Mackie,

HA 2-0270

35

Burns Heads National Bureau of Economic Research

<

New York

&

______Cover

ary

Members

Singer, Bean

IBA Convention-

Attendance at

In

25

BROAD

Pan-American Sulphur

47

Committee

Candid Pics Taken at Convention

WILLIAM

25

McLean Industries

44

Copyright

Spencer Trask & Co.

Ultrasonic

42

PICTURES taken during the course

CANDID

PREFERRED STOCKS

specialized in

4-3634

City & Denver

Hycon

41

Committee.^

Committee

Taxation

Federal

Published

have

Lake

40

State Legislation Committee-..

The

For many years we

Salt

38

Natural

and

Coming

restraints,

'

to

Place
HE

•

37

Securities Committee

Utilities

Nuclear

un-

Yes, the time is here to
save

Teletype NY 1-4643

Exchange

36

Committee

^Canadian Committee.

internamake it impera-'
avoid excesses and

j^eep

In

1

34

Committee

Securities

Investment

tense

a

Committee

Exch.

Broadway, New York 4

DIgby 4-4970

Wires

Special Industrial Securities Committee

much

general business
pointing upward.

highest level.

42

31

America—Maj. Gen. J. S. Bragdon 33

Securities

Securities

afraid,
in the pres-

world.

less and

m

Salt Lake City Stock
Spokane Stock Exchange

Jersey City

IBA

,

Members

Capital Markets—J. Sinclair Armstrong 29

on

Public Works Needs of

of our buying, building and
borrowing. It is well to remem-

1

J.F.ReilIy&Co.,Inc.

28

Growing Foreign Investments—Robert L. Garner

am

some

spend

24

Trefethen, Jr

SEC's Impact

IBA

break

in

our

—E. E.

too

in- maladjustments of production and
We consumption and excesses of debt
have maximum
employment at —we'll launch the economy into
high wages, we have our highest
spiraling
orgy—with
the
in-'
output, our highest consumption a spiaiing orgy
wun me
—and the prospect is that busievitable aftermath of collapse,
Nearly

dices
.

in

the pages indicated:

on

27

strength in our
We had better postpone

cycle.

appear

Kaiser Industries Corporation in Depth

too

reserve

up

economy.

Rio de Oro Uranium

Investment

26

whether

to

is, I

answer

of

the

of

Hollywood, Fla.,

Meeting the Nation's Steel Needs—A. B. Homer.—

are

money

trying

"yes," and plainly
state

at

W. Davis

.■

credit.

Convention

America

Raising Our Performance Level—George

dangers,

any

do hear it asked

we

we

of

a

tight—or is living too loose? The
old saying is that they who have
nothing to be troubled at, will be
troubled at nothing. Maybe it is
just the banker's lot to trouble,
But

Annual

United Western Minerals
deliv¬

Reports

Threshold of 1957—Robert H. Craft

Railroad

economy,

there any troubles,
any questions at-all?

-

The economy

The

Governmental

this

much

recent

Committee

and

Texts of IB A Committee Reports

sures

etting/

herein

,

in

addresses

Bankers Association

Doing Too Much Too Fast

ent

the

at

of

and

more

ber that, historically, a capital inHow will our monev respond to vestment
boom such as we are
them? What will be"their impact now having has been the culminon
our
whole
economy?
Even ating
phase
of
the economic
bnes

ered

TEXTS

people,

more

Strategic Materials

Texts of IB A Convention Addresses
FULL

1957.

better

and

21
23

Sabre-Pinon Uranium

in-

higher costs, and broadly in that
great American concept of better

and

fairs; it catches and reflects their
every change.
After all, money is
only a medium for the exchange
of goods
and services.
Its purchasing power is not fixed but is
measured by prices; its quantity
changes
with
our
fiscal
and
credit policies, its base and price
In terms of gold can change and
have changed, its form is varied,
it will nervously run into or out
of a country, go into savings and
come
out of
them — an elusive,
der it

in

Pacific Uranium

stronger in

consumer

and I think that much of it—most
of it—is pretty solidly grounded
in our research and technological
achievements, in our push for
greater
productivity
to
offset

Money is a mirpolitical af-

peaceful growth.
ror

easy,

deflation or can

or

sound,

a

or

whether

cheap,

or

will be

money

the

-

More Prosperous

con-

Notwithstanding
record activity, prices generally,
although rising, have not spiraled
and run away. This all makes up
into a pretty attractive picture,

determining
tions

be

e\ en

of

v

Big Horn-Powder River

17
* 20

Economy—Ralph V. Coles
Tight Money and Business Volume—Ben H. Wooten-

tbat
were
slowed
by
market saturation and inventory
adjustment during 1956 may do

will

many

Some

YORK

Baruch-Kenelind Oil

14

Outlook—Roger F. Murray
to

NEW

Whitehall 4-6551

13
*.__

Widespread Use of Automation Key

dustries

on

decisive in

be

capital goods, and there have

been estimates that this will

12

1

Shoemaker

STREET,

12

Reforming Professional Services—Roger W. Babson
Bank Credit Demand

it has been the tremendous demand
for

W.

WALL

Telephone:

Picture

Say Die!—William G. Lightbowne
Investment Banker's Role in Financing Small Business

The dominant influence in 195G

dark-

.

Never

if I don't,

me

99

__

my guess

we're,

season

obsolete* !„

Obsolete Securities Dept.

10

—James

figures if you'd like; but

9

11

Curtice--!

H.

the

for

—

6

Automobile Sales Prospects and Salesmen's Opportunities
—L. L. Colbert
•_
l__
Cosden Rides Again—Ira U.
Cobleigh
Consumer Credit's Responsibility for' the Business
—H. E. Luedicke
is.

independence.

of

what

matter

business

5

Automotive Year Ahead—Harlow

"

program

subject

the

approach

in

.

Reserve's efforts against rampant inflation,

support Federal

we

No

4

_

____

too much credit;

on

1

Business Situation and Outlook—Ezra Solomon-.*-Chemical and Pharmaceutical Industry Outlook for 1957
v —John
E. McKeen__
i_;

including opening the Suez;

economy,

Fuchs-^

WHITE CHRISTMAS?

3

-

reserve

feal "crash"

a

R.

COMPANY

Cover

Future Course of Toll Roads and Invfestor-Banker Confidence
—C. Cheever Hardwick____
.__i

strength."
In listing measures to safeguard our security,*
national welfare, and freedom, Mr. Alexander advises: we can- ,
not

Jr.__

Repercussions—Henry C. Alexander
I.
Population Growth Concepts and the Economy of Tomorrow

since international tensions "make it

avoid

we

point

seven

undertake to make clearer

Martin,

Looking at Our Domestic Economy 'and International

Chairman, J. P. Morgan & Co., Incorporated

should

McChesney

AND

i

Policy During Inflation and Deflation

—William

By IIENRY C. ALEXANDER*

Nationally known banker advances

LicHTtnsTtm

B. S.

Articles and News

And International Repercussions

we

3

Wires

to

DENYER

SALT LAKE CITY

4

The Commercial and Financial Chronicle

(2500)

.

Thursday, December 13,1956

.

.

V

have to enter teaching. The aver¬

Population Growth Concepts
And the Economy of Tomorrow

rate in

age

less

than

avoid

in

Columbia

School of General Studies,

educational

this

University

"day
after
ominous, if

begin to decline shortly;
increase

predicts U. s. birth rate will
nation's population will not be as

typically maintained; unlikely

as

rapidly in next 20

as

years

in

the years

will not

of

economy

provide

YOU

the

turn

Most

relationship between popu¬
change and the economy

tomorrow

First, there
have

has

two

aspects.

the changes which

are

already taken place.

know

that

haved

the

like

a

birth

roller

We all
has

be¬

coaster in

rate

re¬

cent

that

and

the

gin

continue.
most

mendous

absolute

past

of

relative

and

interesting

decades, and I shall very
briefly trace some of the implica¬

show

an

tions

immediate

five

behavior

the

for

the

over

postwar

is

that the
actually

years

advance

It

terms.

also

note

to

recent

this

some
years,

10

boom

a

most

of

more

as

may

not take place

This

will

rates

of

lead

to

in the future.
discussion

a

of

What

children,

economic

sources

figures tell us
First, they give
idea of the size

some

life.

of

needed

If

babies

by

product

your

and

probably

you

is

young

riding
boom in

are

the

crest of the biggest
history. If the teen-agers are your
market, you can look forward to

growth.
I

TABLE

Future

of the potential market at various

examination

basic

these

businessmen

stages

the

do

about the future?

change in income and
'productivity, and
finally to an
of

Business

the

Live Births in U. S.

1921-1955

wonderful

some

business

in

Average

of Births

Birth Rate
( per

(millions)

1921-1925*

12.6

1926-1930*

11.8

1931-1935*

10.9

1936-1940

1,000)

22.4

sion

for

ahead,

17.3

basis

another

1941-1945

13.8

20.0

17.6

24.2

1951-1955

19.6

24.7

"Based

upon

us

less

than

1(M>%

coverage.

consider the past changes

first. In

Table I I have attempted
summarize the basic informa¬

tion

concerning
birth
statistics
during the last 35 years. We see
the

twenties

downward
was

trend

accentuated

of

by

the

the

several

for

of

been

which

by

Dr.
Fuchs
at
the
6th
Annual
Dean's
Day
Homecoming,
New
York
University
School
of
Com¬
merce,
Accounts, and Finance, Dec. 1,

As

more

years.

Looking

we can see

and

parents

in

birth

if

enter

bring

you

predictions

years,

the

the

tremendous

the
into realiz¬

the

schools

already

are

to

future

make

popula¬

statements

projec¬

assumptions

stated

hardy enough to attempt, involves
explicit or implicit recourse to

theory.

States

will
at

crease

10

mistic

crowded, but it is

easy

the

of

full

brunt

population

the

upsurge

to

see

the

has

that

recent

not

yet

impact. In order to meet

coming need for teachers, for

example, 50% of all college grad¬
the

next

10

years

would

of

continue

to

in¬

fast

a

rate

in

as

will

nor

the

as

"business

it

be

Let

typical

have

you

the

same

their 2.0s

the

My
was

No

the

across

children.

She

wonder

those

are

pleased

td announce that

is

h§ye been shuttling back
the

delivery

sisters in-

30 to 40 have also

completing
by

Please

Joh& p. Freeman

few

their

families,
were

major companies, giving

York" Office
an

and

us

in

our

has been

Assistant Vice President

do

Census
not

case

families.

them

to

which

Projection

The

which

assume

female

a

have

be very

that

should

Yardstick

amount

constitute

the

of

of

chief

se,

per

basis

concurrent performances of other

of

of

a

The

am

Specialists

using

be

The

The

continuing basic
Report.

Company Report
of stockholder enlightenment is the

source

While

this

document

now

increasingly

potential

benefits

are

great.

The

available

statistics regarding
indispensable for both
management appraisal. Also important in

operating results in various categories
market

valuation

and

are

the annual report are items of information
regarding improvement
of products, the
meeting of competition, labor relations, and the
like.
addition
and

to

applying comparative standards in comparing

judging growth,

you

work of the

long-term view.

In considering sales increases, watch

out

inflation

for

the

Scrutinize

the

windfall

breakdown

of

keep them in

must

the

as

on

new

plant,

and

necessary.

Watch for

"Excerpts
School

for

from

Social

a

lecture

merchandised.
and

replacements,

United States Government Sfxlrities

and

independently

CHICAGO
December 10, 1936




NEW

YORK

BOSTON

on

Research,

Dec.

the

13,

series

"Your

already

unrealistic.

had,

on

Investments"

at

1956.

MUNICIPAL BONDS

seem

SPECIALIZING IN ODD LOTS

This point

to

have

of

swelled

500,000. He also presents a method
of estimating future births, which
on

page

to $10,000)

es¬

the number of births
during 19461955 by between
3,500,000 and 4.-

Continued

up

Rec¬

ord," August 1956). Whelpton
that the catching
up

appears

(Amounts

(The

103

LEBEINTHAL6 CO.
135

BROADWAY, NEVYORK ©LN.Y.

1 [Oldest House in America

.

REctor 2-1737

Specialbina in\

|ODD LOT MUNICIPAL BONDS]
Bell

System Teletype NY 1-2272

ex¬

research.

this item

special regula-

these

postponed births and the advanc¬
ing of timing of births by young¬

girls

on

signifi¬

which deserves careful
study
Conference Board "Business

er

Scrutinize

contemplated

the taking advantage of

in

frame¬

possibly controlling factor.

products

the unfilled order figures: and the current

penditures

the

projections,

children

suffers

tendency toward over-elaborateness, over-dramatization,
or
over-simplification following the individual public shareholder's
desire for spoon-feeding and his inclination toward
apathy; its
a

birth rates for each

timates

in

their growth,
comparative

am

a

repre¬

industry
scrutinized, for the record of profits, operating ratios,
growth, etc. The extent of going-with-the-crowd is crucial.
should

developed at some length
by Pascal Whelpton in an article

INCORPORATED

to

same

theoretical

some

Census

nor even

appraisal.

companies in the

has been

Aubrey G. Lanston & Co.

score

Comparative Tests

profits

Continued

I

sample of

Rather, I
is

age group
number of

the

women

to

think
on

illustrate

cance.

of

definite

a

Weigh carefully the depreciation figures, getting help

World War II.

point

has become associated with

journalistically.

informally and irregularly, individual volunteer

The

In

basing this

formerly 'faith the J5dn}{ers Trust Company

New

of

'

Mr.

elected

also get impressions of management

surrounding compensation.

results

Unrealistic

y»

its

produces.
Based on questionnaires embodying 301
to 100,000 concerns, the respondents are rated in

Neither the

if
'*

Any
to

access

A nonmember may buy a copy at $1 of
thousand individual company audits the

opinions about management. Issued during their indefati¬
gable attendance at meetings and in their own full Annual Report,
these expressions ♦re
largely concentrated on alleged abuses, as

the

been

families which in many cases

•We

communitv service.

express

high. For, at
time-that these girls in

on.

has

group

delayed

I

born

third

andj/bjbme, their

age

been

a

sentatives of the Minority Stockholder, as Lewis and John
Gilbert,

from

neighbors
the wife is

family

forth- between

and,

as

Associate Member, with

an

pertinent categories, including research and develop¬
of earnings, sales vigor, executive evaluation, etc.

can

More

Annual

door

three
so

rate

room

become

executive direction

ex¬

years.

the

children,

The

has

And

birth

rem¬

Sometimes this is done on an individual
company basis, via the
Fortune "profile" type of write-up. Or there may be group
ratings,
as in
Forbes Magazine of Business, which annually evaluates the

the

an

all

five

when

next

three
28.

27.

r

give"

past

26

' My

now

man¬

are

health

You

consists

from

children,

the

was

have

prospective stake,

or

sent

of ten

ment,

opti¬

would

borrowed
me

three

within

street

questions

as

ample close to home—my home.

born.

organization
each

Investor

by several instrumentalities. The American
Management, a nonprofit organization, rates manage¬

of

of the three to four

any

the

years,

future."

wife

actual

an

reports, at $25 per year.

Down

not

as

speeehmaker

have

|

Individual

the

May

partly so,

or

Institute

to

Wilfred

the intangible qualities of management and its
policies.

years

over¬

edied,

preference among assump¬

large in 1975

citizens,

Available

A.

1952.

facing the individual investor in judging

agement, in which he has

or

tions indicated,
are
satisfactory.
Prediction, which I am now fool¬

past

Appraisal

The difficulties

in¬

the median

may

going

process,

have

now

their boards of directors

are

all

democratization

shareowners

individual

about

with

the

all

Management

factors

mechanical

on

of

of under $7,500 a year; with

ments and

of

but

from

from

changes

about

Neither

tions

stemming

ownership

But it is precise¬

tion

change.
faith, nor

status

corporate

income at $6,200 compared with $7,100 in
Women outnumber men.

has

rate

recent

us believe.
figures may shock us
ing that an educational plant and
This prediction rests upon two
staff geared to the
demands of theoretical
considerations.
The
recent years will be woefully in¬
fifst concerns the timing of births.
adequate to cope with what lies I believe
that part of the
high
ahead. Some people believe that
birth rate in recent

uates in

1956.

the

high

may

of

Manifesting
two-thirds
comes

reference to the

attempt to weigh

any

stockholder's

increase. A full million of
increase occurred last year.

like

Very rarely
theoretical discus¬

why

so

one

people—a 33%

this

cautious

the

housing boom in the 1970's.

made its
address

faith,

ahead. The figures show
why the marriage rate has been
It is my belief that the birth
falling in recent years, and why it rate will turn down shortly, and
is likely to
continue to be low that the population of the United
still further

1946-1950

of

More

on

any

as

has grown by more than 2 million to 8,630,-

000

al¬

us

17.2

11.3

see

shareholders.

recent

ers

ercises in arithmetic.
do you

of

establishes it

now

years, according to
census by
the New York Stock Ex¬
change, the number of the nation's stockhold¬

will

stated

Birth Rate to Turn

19.7
•

separation

a

Census Bureau projections, which,
you must realize, are merely ex¬

decade
Total Number

the

the

Country, and not

or

question.

souls fall back

diffusion

control.

the

ly such considerations which must
Forecasting

ing

of

of

years

often

article

an

to

is

in the birth rate.

period.

economy of tomorrow.

Then, there
is the more interesting and de¬
manding task of talking about the
population changes which may or

This

and

During the past four

high birth rate of recent

years have
simply tre¬
proportions,
both
in

witnessed

but

question

number

population's size

community; while
problems surround¬

like

the

discussions

recent

belief in God

depression, that there was
recovery
during the war

the

This

of tomorrow usually be¬
with the assertion that the

open

lation

further,

to

COMPANY*

of the major segments of the
its makeup highlights the

economy

of income.
The

conclu¬

that, I would

do

YOUR

importance of the relationship of the stockholder to his
company is being constantly enhanced through the vast increase

the years ahead.

important in determining birth rate than absolute level

more

pursued

now

AND

The

an

what will the birth rate be like in

commonly believed.

as

is

obvious

not

than

to

revolutionary contribution to U. s. produc¬

a

be

rather

increasing

an

and automation

energy

tomorrow"

in

could

Looking at tomorrow's economy,
the problems of deteriorating
educational standards, inability of market forces alone to
check private power concentration, and our chances of getting
innovators.
Avers income rate of change and duration is
tivity

*An

By A. WILFRED MAY

That
conse¬

of projecting the fu¬
impact
of
recent
changes

ture

Professor Fuchs comments upon

that

deterioration

serious

This game

it did in the past;

as

ahead; and atomic

capita will

per

savings and capital for nation will not be at
rate

Let

Observations.

sion.

large in 1975

to

has been
continued

standards.

have
for the

may

quences

of

serious

a

Columbia University Economist

of

Given

high employment and demand in
the private sector of our econ¬
omy, it is difficult to see how we
can

By VICTOR R. FUCHS*
Assistant Professor of Economics,

recent years
20%.

page
the

116

New

Volume

184

Number 5594

.

.

.

The Commercial and Financial Chronicle

(2501)

unwelcome

Future Course of Toll Roads

acter,

fulfill

to toll road

disagrees

with

contention

that

-

Federal

Mr. Hardwick offers suggestions designed
investors of continuous sound management of toll

ditional

controls

in

the

pressed

circles

heard

the

engineers

opinion ex¬
in investment

frequently
that

the

lished

Federal

new

Program will obviate

also

toll

truck
tor

I

in¬

far

am

inclined

more

to

such

ratner

tainly has been

to

wnicn

snouid

be

ior

requirements

in

At
a

me

that

is

of

of

months

a

occurred

in

confi¬

whicn,

respect

in

be of last¬

prove to

public

enterprises

in

the

time

toll

new

the

the

of

toil

projects

demonstrated

can

a

in

then

Thereafter

be

position

a

existing

As

you

all

are

aeu-

ceedingly tiglit. 1 doubt
that

would

it

be

are

possible

tive

of

tion

if,

terms,
could

tnis

condition
as

than fundamental
of

additional

to

concern

reflects

on

itself

I

and

of

a

more

per¬

manent nature.

Federal
on

Aid

new

Highway Program
undoubtedly con¬

toll roads has

in

in

some

and

markets

However,

for

degree

to

tne

toll

to

that

weakness

road

bonds.

the public has be¬
informed regarding
the Federal
program, that particu¬
as

better

come

lar influence has, 1
believe, tended
to diminish in importance.
Inci¬

dentally, the interview
missioner

trust

by

of

integrity to adminis¬
One job poorly done
toll
facility Authority

jdb.

any

anywhere
is

have Au¬

to

in

the

United

to-year
South

realize

that, we have done our
irreparable injury. That
fundamental, gentlemen."

cause

is

an

west

A

in

motive

M.

Stine

with

has

Hanan

become
&

associated

Kiebler.

He

and

prior

in Colvin

thereto

was

partner

a

& Stine.

Curtiss

that

with Com¬
was

pub-

4

*

the

29%

rise

in

1955

reveals

address

Bridge,
tion,

Annual

by

Mr.

Hardwick

Tunnel

Inc.,

before

meeting of the American

and
Turnpike
Wichita, Kansas.




Associa¬

November

auto¬
pas¬

the

The

that

current

claims

those

There

that

of

was

unemployment

fractionally
of

last

some

but

unem¬

Total

employment dipped 900,65,300,000 in mid-November

a

month before, the United
Departments of Labor and

reported.

Earnings

of

sharply

factory

workers

records

new

in

mid-

November.

The joint report said
earnings
advanced
21

weekly
cents

from

report

the
1

growing crisis in steel plate
supply is generating more pres¬
sure
for some form of voluntary
allocation.
But
counter-pressure
against allocations is coming from
steel

mills

and

policy¬

top

some

istration,

states

national

metalworking

"The

Age,"
weekly,

Iron

this week.

Meanwhile,

higher steel
further

ing

the

the

pressure
for
mounted still
present week follow¬

prices

91/2 cents per pound increase
price of nickel. Stainless
steel producers will be hard put
to absorb this price advance. Odds
favor a boost in stainless prices
in

a

the

after turn of the year.

Unemployment rose
550,000 to 2,460,000.
reached

last year's

topped

1,200,000,

The

by

year

new

ployment in food processing, ap¬
parel and construction industries.
000 to

still

by

stated.

makers in the Eisenhower Admin¬

employment situa-

declined

exceeded

4%.

under
week,

mid-October

to

a

The tug-of-war in plates is an
outgrowth of the Suez Canal shut¬

and the cutting of a major,
pipeline. The resulting Euro¬
pean oil shortage calls for a stepup in oil tanker construction, redown
oil

Continued

$82.42

on

page

discriminating analysis of

37

TURNPIKE, BRIDGE and

OTHER

REVENUE

BONDS

Because of the current uncertainty among

investors concerning

Municipal

the

be

Restoring
I

desire

Investor

not

am

ment

This

in
the

on

ex¬

to

prepared

mo¬

the pos¬

sible changes of that nature which

be

demanded

by

buyers

well

lie

firmer

in

such

control

tion of

opera¬

revenue

thirty-two projects financed by

issues

and

unfavorable

factors

discussed. Included is

are

a

the

pendent
the

the

of equivalent

bonds.

on

effecting

engineers

of

bondholders

to

disbursement

of

control

sion

tighter

of

some

tolls;

manner

and

of

ex¬

inde¬

any

ar

r

nearest office.

Dean Witter Se Co.

of

construction
over

,

I
New York Stock
and other

Please send

i

Exchange

and Other Revenue Bonds"

leading security and commodity exchanges

revi¬

perhaps

,

Members:

the

even

of control

14 Wall

recognize that to

many

45

Montgomery

105

of

you

Street, New York 5

NAME-

Telephone BArclay 7-4300

the

over

quality of management.
I

our

i

-

as

approve

funds;

to

*

of this helpful study, fill in and mail

appoint¬

behalf

on

these

table showing bid

yields of taxable investments.

For your copy
coupon

engineering

appointment

re¬

the

ports

might

categories

over

ment of successor

perts;

them

of

some

Bonds."

prices during 1956, approximate yield and comparison

at The

discuss in detail

a

study reviews

issues and

37

Favorable

Confidence

our

the current status of

the part

strengthen and
pand them in the future.

*

Other Revenue

controls

contained

bond issues,

special 32-page booklet, "Turnpike, Bridge and

constant
investor is the

agreement of

revenue

Bond Department has prepared

G32-34

South
South

La

Street,
Salle

Francisco

San

Street,

Spring Street,

Chicago

Los

6

STREET.

3

Angeles 4

„

*Ah

However, non-agricultural em¬
ployment did not show its usual
November pickup, but non-farm
employment of 52,400,000 in midtotal

15%

was

similar

tion

'

of investors to

■

the 24th

the

South¬

and brought
production
to

car

trucks

was

forfnerly with La Montagne & Co.

Pacific

the entire drop occurred
agriculture with end of harvest¬
ing operations in many areas.

highest level so far this year.
However, the output of cars and

Commerce

.

FRANCISCO, Calif.—John

in

occurred

output

senger

States

(Special to Thk Financial Chronicle)

SAN

regions

many

and

a

such considerations must have

the appearance of a distasteful ar-

rogation of power, or at least

an

SERVING

INVESTORS

IN

32

earn¬

although
down in

in

regions.

resulted

that

employment went
mid-November, it was still at a
record high level for the month.

step-up in overtime schedules

from

With Hanan, Kiebler

in

gains

Central

a

to

peak

the
use
of
electric
heaters. The most noticeable year-

States

great injury to every toll Au¬
thority in the United States. We
have got to have integrity in this
thing. And the first time we fail

weather

said

report

Almost

production
last week

power

record

a

limited and I suspect that

may

However,

the effect of the

to

uneasiness

thorities

ter the

safety is

Hourly

1 cent to $2.03.

rose

The

con¬

toll road bonds in the future.

Uncertainty in the minds of in¬

tributed

of

.

cold

similar

prompted

warn¬

ing expressed by President Wedeking.
At the Spring meeting of
this
Association, Mr. Wedeking
said, in part, ".
the fundamental
.

reached
as

the

year ago.

Electric

the

the

However,

are

may

Investor Uneasiness

as

I

a

than

1

importance,

vestors

of

un¬

to be a factor of equal

Would also like to echo the

but

period

/
'

-

management

there

toll road cred¬

to

rule;

level

written into the bond

'

k

usual

past

referred

the part of investors which

may prove

the

improvements.

which

)

over

may

other

or

the hands of the

expenditure

Theoretically,

planning

tne

roads

are

trustee.

rather

growing attitude of

a

easiness relative
its

in

toil

public

necessary

The

in

temporary

the

mid-November.

total

higher

funds, the legal obliga¬
levy adequate tolls, the

watchdog for

However,
market conditions change,

regarded

of

excep¬

in

duction the past week and it con¬
tinued
to
reflect
a
moderately

indenture.
<

such financing

fact,

to

forth

so

means

be eiiected at all.

money

and

be

in

the

of

ings

preparation of annual budgets and

bonds upon reasonable

revenue

the

struction

under

major toll facilities by

to

ex¬

existing circumstances to finance
any

been

than

output

and
electric
power lifted total industrial pro¬

provision for approvals by quali¬
fied engineering consultants rela¬

much

very

rather

the

investor except to the extent that

present

aware,

market conditions

tion

in

coal

to

manage¬

control of manage¬

all

ment passes from

nite need exists.

money

business

management

has

increase

the

not

to

economically

ior wmcn

and

justifiable

wnicn

be

to

sound

An

automobiles,

financing of
bankers and

facility,

are

•

hicle

Index

Business Failures

the

authority or commission
to
which
what extent and on wnat terms
they
are
considering
the necessary funds will oe avail¬ lending millions of dollars is in
and
able'to finance the new motor ve¬ capable
trustworthy hands.
is

the* lawyers.
The
will be political in¬

questionable

definite

a

investor

ment und,ta determine whether or

more

at me moment

me

to

responsibility

the bankers, the

with

toll facilities

manage¬

have

resulted

of

enter¬

Unfortunate¬

recent

that

investors

judge

question

concern

nor

terference

the theo¬

of

Price

Auto Production

future.

seil'-iiquidat-

a

Managers

service

events

have

similar

ing enterprise.
The

bond

in my opinion, to
financing of toll facilities and.

the

any

meet

to

the

of

turn, may well
ing detriment,

cei-

aoanaon

the

with

cause

element

business

Road

politics.

during

dence

by

Tnere

appear

Toll

undermining

soundly conceived projects of mat
nature

of

divorcement

from

which

disposition evi¬

no

far

type

puofic

ly

as

reiaraeu

than

program.

mus

in

important

always been

number

in densely popu-

their need

areas,

f ederal

the most

any

has

ment

tneir
ap¬
by - passes

meuopoinan

advanced

denced

faculties

and

and expressways

the

of

retical

toll roads,

ior

toil

crossings

later

of

one

prises

not,

and that if we include in the term

proaches,

eco¬

roads

^

operating

be¬

man

cases

more

roads"

their

toll

authority method of financing and

Program No Threat

vide direct benefits

river

of

One of the basic precepts of the

the Federal Aid Piogram will pro¬

'"toil

reconsider

Trustworthy

Federal Road
I

fac¬

a

venture, namely, management.

Hardwick

both counts.

on

lieve Uiat in

to

appraisal

aspects
C. Cheever

clined to be in

disagreement

been

importance and has caused

in

tors

to

am

also

parts of both bankers and inves¬

observe

date, I

has

attracting

However, the most disturbing
development, to my mind, is a
growing lack of confidence on the

con¬

personally

experience
in

roaas

general.

have been able
to

of

nomic

struction.
what

traffic

neers,

are

presently
i n
operation or

From

toll

bankers and investors, and
suspect also some traffic engi¬

I

facilities

under

and

many

the

which

disappointing

certain

Commodity Price Index

Industry

neces¬

In closing I wish to state em¬
phatically that I believe evidences

The

to

of

prove

revenue

management.

of

will prove det¬

many

News

Report," which received
circulation, was, 1 think, par¬
ticularly helpful in that respect.

it

rimental

S.

'

Food

and

Trade

least

wide

Aid

the need for

and

that

"U.

the

At

World

additional toll

highways

in

do

the

future,

will not lie

primary
have

State of Trade

to

-

Carloadings
Retail

morally

financing of certain toll facilities

projects, although emphasizing belief that evidences
"questionable management has been the exception rather
than the rule."

I

desire

terms.

obtain

to

sary

revenue

of

'J

borrow-,

thing seems certain at this
point in that respect. If such ad¬

credits.

reassure

the

Production

Electric Output

one

of investors' uneasiness relative

appearance

Steel

The

legally are vital to the
availability of credit

as

favorable

upon
.

of

part

commitments

continued

detrimental to toll facilities, and finds

prove

important the

more

to

will

r

*

intrinsics. -Good

as

demonstrated

a

his

well

as

banker

the

on

and

er,

well

as

faith

By C. CHEEVER HARD WICK*

Investment

the

However, in financial circles,
good security is a matter of char¬

Partner, Smith, Barney & Co., New York City

road program

with

normal functions of management.

And Investor-Banker Confidence
„

interference

5

CITY

CITIES

—

1 STATE.
~i_

me

your

study: "Turnpike, Bridge

I

101

6

(2502)

The Commercial and Financial
Chronicle

even

Business Situation and Outlook

20%.

By EZRA SOLOMON*
Associate

Professor

of

sharply.

more

housing

starts

*

other

nearly-

side,^ of

the

From

Washington
Ahead
of the News

picture, machinery and instrument

Finance, School of

manufacturers and. the

Business,

heavy

con¬

struction sector enjoyed rapid

University of Chicago

in¬

creases.

Adding

the total outlook for next year's third quarter, rec¬
Chicago Economist envisions it will increase to

up

ognized

$433 billion with

(3) In the final quarter of 1956,
in the automotive sector

recovery
to

corresponding rise in personal income—

a

assuming present events do not lead

to war; and, looking fur¬
ahead, would not be surprised if $500 billion economy ex¬
pected in 1965 will be achieved in 1960—taking a minimum,
inevitable, secular price rise into account. In scrutinizing a
in

has

is

liquidation will
next

and

year,

was

a

not act

year

high

as

economy

deterrent

a

Examines

ago.

rigidity, and does

is in

now

to

Reserve general

Product,

high production rate

control.

Developments

ter

has

economy

subjected,
times, to significant declines

four
in

one or more

of

rapid

demand.

meant

'

t

e

i

t

n

strength
p cher
s
e

v.x

h

these I

in

for

to

has

become

forward
for

in

1956

mixture

later

respect
prices.!

past

-

is

investment

consumer

to

producer

invest¬

still

present

some

had
of

number

a

which

of

were

results,

anticipated

.activity
and

in

the

construction

the

took

and

construction

sectors

(2)

of

economy.
Between
the 3rd
quarter of 1954 and the 3rd quarAn

address

by

Professor

there

the

Executive Program
Illiiois.

Club

of

strike,

only

142.5

during

The

General

of

major
no

in¬

We

war.

have

events

but all

to

will

that has

the last two weeks,
and
we

over-all

powerful

sales

fell

million

Chicago,

rate

in

rate,

and

late

from
1955

to

production

a

6

fell

occurred

first

America's Oldest and
are

an

investor you

hundreds of Over-the-Counter issues
dividends have been paid from
5 to

a

It

lightening information
portant market.

regarding
-

This booklet

is

the
'

.

offered

172

years,

as

procedure

well
in

as

this

im¬

>

slowdown
If

a

Today,

there

is

evidence of

cline

of

sector

the

any

largest

trade

of

leading

Over-the-Counter

is

likely to
of

be

may

obtained

rise

level! of

expected
the

pect

de¬

in

a

Enclosed please

find

ASSOCIATION,

cover mailing charges for sending
explaining the Over-the-Counter -Market.

Name

me

the

rate
136

about

opinion
on

the

have
to

pundits,

the

how

much

foreign

our

Eisenhower,

because

of

Hoover's

the

lot

to

do

having

with

been.
up,

been

putting
scene

that

the

So

Chris:

barn

in

with

over

Herter,

ingrained

an

inter¬

France,

the

Congress the

that this betokens

and

an

Eisenhower's part to world affairs.

on

being told,

are

had

we

bottom

much

a

broader

Marshall

and

Plan

for

spending plan

a

being told, Aswan Dams everywhere.

exchange of

of

new

Under Secretaries of

State,

our

foreign

likely, in

more

I

forces

far

am

in

of

party.

It

the

won't

be

confined

pressure

this

sort

is

the

the

to

into

party

opposition
three

will

War

team
I

player and

and

II

and

a

although

he

a

he

as

expressed

admiration

great response every
to put

them.

meets

his

In

for

to

both

Bob'Taft, the two

conditions

his fight
;

/

recent

in

dealing

campaign

Eisenhower.

But

he

he
also

time he said he intended to continue

foreign aid

.Other Republican

had

every

-approach

professional
should

on

a

loan basis.

Senators said

believe

to

reason

in- their

there

would

campaigns
be

a

that they
realistic

more

They
•

pointed

of

foreign

that

out

the

v/hile

these

gentlemen

recent course of events necessitates

.tries,.such, for example,

?

the. British

for

-go,
for

based

by

loan, it

way of

any

is

as

a

the

pressure

of

now

the

tell

next

session, of

against continued

is

in

prodigiously
capacity. Ex-!
new
plant
and

106

or

he_will need
•

more

of

will

State.

He

than
need

a

a

new

new

relief to

and

session.

commission

reason

that

European

to

me

that

the

coun-

the interest payments

on

they will

Eisenhower Republicanism,

doors

the

a

broad study of the question.

up

like this is in. President Eisenhower's
-

created

conceivable

Treasury

us

had

some

passing

scarcely

supporting moderate

opening

propagandists

productive

page

at

undoubtedly

Bearish
is

aid

President

headed by Clarence Randall to make

Now,

this" argument,
outlook

problem

Congress. They recalled the tremendous

down

Goods

the

foreign "give-aways" which they experienced at the last

pro¬

so

to

ex¬

September.

on

own

have

Senators

opposed

was

admirer of

great

happened and Bob Taft is dead, and he believes

frequently

one

or

be

part

his

he
four

or

to
a

occasionally mentioned.

added

for

this

with

got

to

that

of

Republican

underestimated

the

on

open

global leadership, and

our

be

s

effective, If something

making

Treasury

wars

iorders

^o

148

Continued

our

convinced

the President,

on

any

to

me

tremendous pressure

a

from

to

seems

was

opinion, is that his resigna¬

throw

to

"bold" assertion of

a

policies,

my

propaganda in

as

Hoover, Jr.,

Fqr example, I know of another Senator, Capehart of Indiana,
doesn't:consider himself opposed to Eisenhower at all.. In

World

following observations. We

already

That Herbert

; by

we

the

Eisenhower's

should-be

fact, he is a

These factors

by next

with

such thing.

any

possibly

a

expenditures.
in this sector

penditures

J

he,

childhood,

a

program

his

who

goods

industrial

examine

us

beginning

.Slate

liberal

global leadership had lagged,

our

faulty

from

be effective

it

his

in

unsus¬

disappear

in

Capital
Let

capital




in,

not

he has

tp 15%
capital goods,sector, indus¬
production will fall from its

.

...

when

how

image,- then, he has

usual

in the

trial

booklet

Address

City

(4)

widely-used

42 Br.adwa,, New York 4. h. r.

25£ to

Dulles, didn't know

internationalist

part of

of

1957.

the

According

decline

a

to

NEW YORK SECURITY DEALERS

so-called

farm

capital

to

1957.

year-end

r

the

down, how much

being used

If

-

duction after the first of.
thq year.
Paced by a fall-off of 10

explaining the Over-the-Counter Marketi
by sending 25( in coin or
stamps to

of Hoover

else.

by

It means, so we are

of

will

clear-

Even,

-

course,

forecasting services,

A copy of the booklet

told

foreign nations. And

outburst of activity in the

porary

of

organization

vve

means

tion is

part

importance, 'in jany

demand.

are,

such

inevitable

of

January

dealers. This Association's stated
purpose is to uphold fair and
equitable principles of trade and to maintain
the highest stand¬
ards of business ethics.

outdo

But the

radio commentators, that Eisenhower, having left

ridiculous.. What is

production, (2) the effect of the
steel strike,
especially on inven¬
tory policy, (3) a possibly, tem-.

are

NEW YORK SECURITY DEALERS
ASSOCIATION

Carlisle Bargeron

to

spending plan for the Middle East

a

hindrance ;in

in

.time

same

no

an

recovery
in the textile sector.

the

Repub¬

mostly

about what Herter's displacement

something

from

doubt

itself,

the decline in the weak
sectors,could easily have lead to a
downturn in activity.
% *-:-i

automotive sector,

public service by

I

*

the

"liberalism" to

as

illness

had

for Asia.

this, slow¬

the

at

temporary
as

propaganda

ineptness, had to take hold personally and then for the

who

Europe,

also some

was

temporary factots:^ (1)l arb

en¬

had

same

and

tf)e New Dealers.

being

run

means,

a

by. four

which consecutive cash

on

are

the
over

Marshall Plan, is returning to the

the current level of
industrial pro¬
duction is being supported

booklet, listing

the

referred

entirely different approach

According to this interpretation,

Largest Security Market

such

time,-realized

man

as usual, some
people have already begun.to in¬
terpret these on the bearish side
of the range of
possibilities. %
-s

will appreciate this

image

indeed,

nationalist

this

tainable
If you

his

internationalist

an

uncertainties, and

Over-The-Counter Market

in

Dulles'

as

There

SO-^Page {Booklet Explains

from

leadership

that

things foreign to

until

especially in the
autos,
housing and

inventory purchases..

income

A

is,

so-called

to

was

it

blindly.

making

of propaganda

that

is -in'

Republican

boldly.

affairs

policy had

shadow

it

own

.

cut

a

act

"liberalism" of

We

At that time, th.eyfe.was
evidence of a
number
lor

world

newspapers and

weaknesses,

outlooK

and

means

both at home

than

its

party

wave

away.

position

clear-cut

employment, financing and profits.

be¬

the

happened, in.

today,

economy

stronger
year ago.

of

assume

in

domestic

...

us

the

lectures

upon

his

confirmed—

anywhere

leadership

Eisenhower's

lican

outlook

lead

'

from ,: certain

if

get

have' thought

about

abroad,-will have effects that
cannot

in
I

excess

assume

not

of
*

been

step

long-run fu-.

in .the

out

must

of

uncertainty regard¬
longer an economic-

We have been

recent

his

but

to

in

over

has

trouble

party

expects

follows

mone¬

Outlook

propaganda

negligent

all

The

down

been

follow

It

important

the

on

but for the

current
means.

propaganda forces that this country has

capacity.

an

of

stable

have

million

fore

steel

readjustments in sales, production,
Automobile

Solomon

index

Within

total,

the

*

monthly

the

its average value of
the past 12 months.

place within the indus¬

trial

better

an¬

spite

The

party

himself,-

have

his

ever

require atten¬

have

industrial, farm income. There
production has been within 1% of reason to expect a

readjust¬

ment

because of

in

Asia.

the

and

spending

the carefully laid ground¬

he,

will
of

party

in¬

widespread

and

Republican

he

members

ture.

The

Over-all

July,

*

The bulk of the recent

that

$411

not

was

aggregate

they

1957

one.

the

do

image—which

aggregate demand

to

bearing not

war:

interplay of these offsetting

manufacturing

especially with
monetary policy and

.

Thes

rapid,' ing 1957 is

a

resources

goods.

(1)

a

offsetting

aspects,

to

about

occurred

as

equipment.

had

Europe

have

widespread

these matters

for

retirement

work that President Eisenhower is determined
to

level

The«actual

be

a

Both

in.

Looking back in later 1956, sectors has been
remarkably stable
economic
developments
in
the since
last September.
Excluding
puzzling

will

tion,

and some not.

forces.

just

1956.

from

ticipated.

expenditures

productive

sector

some

1955,

presented

of

peak

a

and

have

of

the

forces

year

in

prices that

50.%'
and relative

began to de¬

business

goods
ment

sively milder. The one we have
just had even rolled uphill a little!
outlook

in

we

The

ptzzling

capacity

there was no demonstrable
in the level of

Product,

rapidly. This decline
by an equally rapid

from

readjustments." The fall-off
activity during these re¬

then

construction

progres¬

the

a!

billion,

continued restrictiveness in

about

over

reached

and

fairly

transfer

Prof. Ezra Solomon

total

Looking

only
$3

1955, this should

1956

in

crease

and

product,

gross

sources

What

what

ar.justments

in

offset

was

be called "roll¬

ing

comprise

National

directly for

rise

increase

we

come

Gross

1955

cline

experi-

fenced

have

the

late

e

v e

ex¬

indirectly for a good part of the
remaining
50%.
Demand
from

a

de¬

cumulative

a

together
of

accounted
of

activity.
Thus, instead
o'c

consumer

Secretary

a new

Most of the extra $6 billion

come

Under

as

State

It follows upon

average gross product of

for

billion.
has

difficult to believe that the

is

Jr.,

Washington is that that is what it

tary and fiscal policies. They took
place in an environment in which

10%

of

recessions,

by

construction

on

of

creases

which

cline in aggre-

g a t

in

1956

the

in these three elements of demand,

g

has

prevented

increases

implied

in

billion

level

This

an

but it

so

Hoover,

of

spree,#in

have

antici¬

were

goods, and business ex¬
penditures on inventory. Increases

in

serious

dramatic

a

principally

durable

e g-

nts

demand

had

we

business activity.

penditures

important segments

Each time, offs

in

generated

was

been

they
rise

quarter of

be

may

Herbert

new

*

reached in the last quarter of 1955.
On the basis of the revised esti¬
mate of $402 billion for the last

v

1955,

increase

Since World War II, the Ameri¬

-

ca!

of

of

appointment of Chris Herter in his place presages

above

so

$405
Recent

It

it

zone

into

In terms of Gross. National

modest
or

monetary policy, built in price
abandoning independent Federal

not favor

By CARLISLE BARGERON

rate

industrial

and

anticipated and

pated.

stronger position than it

a

of

These developments could

capital expenditures
difficult to meet, inventory

or

production

level

experienced

been

production decline could be expected

too

not

the

high levels.

1957, Professor Solomon contends:

and formation

million

push

activity out of the stable

ther

view held that industrial

7

a

will

Thursday, December 13,1955

.

Residential

dropped

the

On

.

.

as

making.

the

In

internationalist

fact, if

thinking, it is
sympathetic

my

Under

anything

conviction

Secretary

Secretary of the Treasury.

Volume

184

Number 5594-

frttarMl

The Commercial and Financial Chronicle

.

the Bend*

•»

"

.

u

(2503)

exempt, in the opinion of Bond Counsel to'the Underwriters.
//'e income

1

therefrom

are

exenipt

from Federal Income Taxes under existing late*, and under the lam of the State of Tennessee, said Bonds and
fromtaxation within said Slate, except inheritance, transfer and estate taxes.
,

'*

NUT ISSUE

163^45,000

CITY OF

MEMPHIS, TENNESSEE
4.20% and 4.40%
Electric
Dated

Light Plant Revenue Bonds,,Series A

July 1,1956

Due

January 1,1963-1977, inclusive,
and

January 1,1992

AMOUNTS, MATURITIES,
RATES AND YIELDS OR PRICES

$20,000,000
Serial Bonds due

January 1

as

shown below:

Due

Rate

or

1963

5 %

Yield
Amount

$2,000,000

Price

3.50%

2,000,000

1964

5

3.60

2,000,000

1965

5

3.70

1,500,000

1966

5

3.75

1,500,000

1967

4

3.80

1,500,000

1968

4

3.85

1,500,000

1969

4

3.90

1,000,000

1970

4

3.95

1,000,000

1971

4

100

1,000,000

1972

4

4.05

1,000,000

1973

4

4.10

1,000,000

1974

4.20

4.15

1,000,000

1975

4.20

4.15

1,000,000

1976

4.20

100

1,000,000

1977

4.20

100

$143,245,000
4.40% Term Bonds due

The Bonds

of operation and maintenance thereof

Electric Plant Bonds of the
tions of the

powers

Price 100%

payable 6oIely from the Revenues of the entire Electric System of the City after payment of

are

the reasonable expenses

City and

of the City to

no
pay

City in the principal amount of $1,557,000. The Bonds

holder thereof shall

ever

have the right to compel

the principal of said Bonds

or

Plus accrued interest from

parity with the presently outstanding

on a

any

January 1, 1992

January t, 1957.

general obliga¬

are not

exercise of the taxing
Principal and semi-annual interest, July 1, 1957 and January I

the interest thereon.

and

July 1 thereafter, payable at the principal offices of National
Memphis, The First National Bank of
or
Union Planters National Bank of Memphis,
Memphis, Tennessee, or at the principal office of Chemical Corn
Exchange Bank, New York, N. Y., or at the principal office of
Continental Illinois National Bank and Trust Company of
Chicago, Chicago, Illinois or at the principal office of CrockerAnglo National Bank, San Francisco, California, at the option
Bank of Commerce in

The Bonde

are

be issued

to

to

finance the

costs

and additions to and extensions of the Electric

of construction and

System of the City, consisting generally of

generating station and related equipment, including facilities
Electric

Memphis,

acquisition of certain improvements

necessary to

steam-electric

a

integrate said station into the

System, certain miscellaneous distribution and transmission facilities, and the purchase of certain

transmission and distribution facilities from the Tennessee

Valley Authority.

of the holder.

National Bank of Commerce in
The Bonds

on

and after

and after January 1, 1968

callable

as

and thereafter, at the times and call prices,

as

maturing

and accrued interest,

on

January 1, 1968

are

at

purposes on

the times and call prices,

The Bonds

are

Bond Counsel

The
may

a

whole

on

January 1, 1967

at a

stated in the Official Statement. The Bonds maturing

as

January 1, 1963,

a

The Bond? may

be issued as Coupon Bonds in $1,000 denom¬
fully Registered Bonds without coupons in denom¬
multiple thereof. Coupon Bonds may be
exchanged for Registered Bonds without coupons and vice versa.

maturity for

inations

call price of 102 and accrued interest, and

at a

stated in the Official Statement.

Memphis, Memphis, Tennessee,

Trustee of the Bond Fund and Construction Fund Account.

call price of 104

callable, in part, in inverse order of maturities and by lot within

Sinking Fund and Redemption Fund
thereafter,

are

or as

inations of $1,000 or any

<

offered when,
to

the

as and if issued and received by us, and subject to the approval of legality by Messrs. Wood, King & Dawson, Netv York, N. Y.,
City of Memphis, Tennessee and Messrs. Caldwell, Marshall, Trimble & Mitchell, New York, N. Y., Bond Counsel to the Underwriters.

offering of the Bonds is not made hereby, but only by
be obtained in

any

State in which this

means

announcement is

of the Official Statement of the City of Memphis, Tennessee, copies of which

circulated only from such of the undersigned

as are

registered dealers in such State.

Salomon Bros. & Hutzler

Kuhn, Loeb & Co.

til
Hklsey, Stuart & Co. Inc.

Blyth & Co., Inc.

Smith, Barney & Co.
Lehman Brothers
1

Eastman Dillon, Union Securities & Co.
v

C. J. Devine & Co.

White, Weld & Co.
-

B. J.. Van Ingen & Co. Inc.

R. W. Pressprich & Co.

Hornbiower & Weeks
A. G. Becker & Co.
lmcmrponul

Ladenbtirg, Thalmann & Co.

R. S. Dickson & Company

Coffin & Burr
locorpoMI.?

Gregory & Sons

Kidder, Peabody & Co.

Goldman, Sachs & Co.

John Nu veen & Co.

Phelps, Fenn & Co.

Drexel & Co.

~

(Incorporated)

k«

.

Allen & Company

A. C. Allyn and Company •
Incorporated

F. S. Moseley & Co.

American Securities Corporation

Blair & Co.
Incorporated

Alex. Brown & Sons

Paine, Webber, Jackson & Curtis

Bache & Co.

Reynolds & Co.

Bacon, Stevenson & Co.

IraHaupt&Co.

Hemphill, Noyes& Co.

L. F. Rothschild & Co.

Jack M. Bass & Company

Dean Witter & Co.

Herman Bensdorf & Company

,

Clark, Dodge & Co.

lKsrpont.4

The

Wertheim & Co.

Glore, Forgan & Co.

Stone & Webster Securities Corporation

Shields & Company

Carl M. Loeb, Rhoades & Co.

lueorpcttuS

l

Braun, Bosworth & Co.

W. E. Hutton & Co.

Hallgarten & Co.

Robinson-Humphrey Company, Inc.

Weeden&Co.

F. S. Smithers & Co.

Equitable Securities Corporation

Incorporated

*

Bear, Stearns & Co.

Harriman Ripley & Co.

.

\

J. C. Bradford & Co.

Cumberland Securities Corporation
t

Dominick & Dominick

Francis I. duPont & Co.

Estabrook & Co.

First of Michigan Corporation

'

Lee Higginson Corporation

Schoellkopf, Hutton & Pomeroy, Inc.

Leftwich & Ross

Shearson, Hammill & Co.

C. H. Little & Co.

Stroud & Company

Tripp & Co., Inc.

Mid-South Securities Co.

I

W. H. Incorporated & Co.
Morton

Tucker, Anthony &R. L. Day

Webster & Gibson

Wood, Struthers & Co. Baxter & Company William Blair & Company Central Republic Company F. W. Craigie & Co. Dick & Merle-Smith First Southwest Company Goodbody & Co.

Hayden, Stone & Co.

Hirsch & Co.

Jkcember 13,1956




*■

1

E. F. Hutton & Company

The Illinois Company
Incorporated

Jones, Kreeger & Hewitt
x

I

Kean, Taylor & Co.

W. C. Langley & Co.

Stern Brothers & Co.

G. H. Walker & Co.

&

9

The Commercial and Financial Chronicle

(2504)

Election

Post

Highlights

Dealer-Broker Investment

Automobile

Electric
&

Recommendations & Literature
It

understood

(<

that

will

mentioned

firms

the

send interested

to

be

pleased

for

Outlook

from

Gas

Utility Common Stocks
& Co., Inc., 70

Saxlon

Securities

Diary

uranium
in

23)—Comments

gains,

capital

chemistry

with

items

dividends

and

Fund,

El

Paso

£033

C.

Inc.,\ Dept.

investing in shares oi' Eaton & Howard

and

Eaton & Howard

Federal

Stock

Fund—Eaton

&

Fund

Balanced

Howard, Inc., 24

Aberdeen

Monthly

—

letter

investment

—

and

Burnham

Company, 15 Broad Street, New York 5, N. Y.

Also avail¬

nomic

Business Review—Monthly report on

trends—Baihk of

and

news

Canadian

eco¬

Montreal, Montreal, Que.,

Canada, and 64 Wall, Street, New York 5, N. Y.
Equities

for

Investment—List

Nordeman &
Federal

State

and

of

176

Anchor

York

Barnes

giving

current

Street, New

Church

in

Alaska,

States,

Canal

Zone,

Guam,

Hawaii, Puerto Rico, Virgin Islands, 1957—International De¬
partment,
New

Manufacturers

York

Income

Trust

Company,

55

Street,

Broad

15, N. Y.

Bonds

—

Tax

—

Bulletin

Vilas

—

&

Hickey,

26

1957—Bulletin—Iiirsch &

York,

Christiana

Securities

Oil

&

Gas

National

Stern, 30 Broad

Street, New York 4, N. Y.
com¬

parison between the listed industrial stocks used in the DowJones Averages and the 35 over-the-counter industrial stocks

in the National Quotation Bureau

market

National
York

Pocket
of

4,

Bureau,

over

Inc.,

Averages, both

46

Front

as

period

13-year

a

Street,

to
—

New

Y.

Guide

South

First

Today's Investor—Pamphlet

securities

Upham

&

tor

Co.,

& Co.,

Wall

income,

Wall Street,

14

containing lists

growth

and

New

We again suggest

.

clients

trading-

York

5,

N.

Y.

and

you

your

profit in:

can

Church

increase

of

fourth

now

largest

from

its

$9

billion

in

the

Co.,

Company

States.

W. R. G. Baker, predicts

sales

to

$15

billion

by

1960.

Position:

100

—

Report

City, Iowa—Bulletin—B.

Co., 17
New

4, N.

Air

120

Brake

analyses of

6, N.

Y.

Machine

Aerovox

brokerage

•

Airborne
•

lnstr.

Lab.

Co.,

60

•

•

Collins
•

Dynamics
•

N.

the

Y.

Y.

Also

Industry,

Upham

available

Amer.

Granite

City

Steel,

Jack &
•

P.
•

R.

Co.,

World

Wall

63

Airways, Inc.—Bulletin—John

Trinity

New

York

Security

Petroleum

Company

Corporation
Federal

140

Stubnitz

of

H.

Lewis

of

Place

—

Analysis

Boston

Greene

Laird,

—

10,

Mass.

Co., 52 Wall Street, New

Pine

HAnover 2-2400

Teletypes
Private

Wires

NY

New York

Alstyne, Noel &

odd

has

Tiernan—Analysis—Dreyfus

&

Co.,

50

I

is

—




LOUIS

was

foremrly

an

L.

SAN

in

A.

Building. He

FRANCISCO

admitted

J.

Beahan

their

to

firm

Mr. Beahan

with

the

firm

&

Co., is

woman

the business together with

husband,
1925.

Louis

After

Lebenthal in

S.

the

1951

Lebenthal,

death

of

Mr.

Mrs.

Lebenthal

partner.

Recently

became

senior

she

married to I. Arnold Ross.

was

officer of Colum-

With

bia Securities Company, Inc.

Joins Lackner Co.
(Special to The Financial Chronicle)

Cruttenden, Podesta

!

DENVER,

Colo.

—

DENVER,

Charles

Paul

J.

ANGELES

PHILADELPHIA

specializing
bonds, an¬

William

associated

only

her

i

LOS

RAPIDS

HARTFORD
ST.

'

i

Frederick

with

now

America

headed by
actively engaged
in
the
municipal bond business,
Mrs.
Sayra
F.
Lebenthal.
She

(Special to The Financial Chronicle)

Scadding

serv¬

1950.

the

Colo.

and

Co., 135 Broadway,
as the old¬

municipal

Lebenthal

Broadway,

|

1-376-377-378

To

GRAND

a

(Special to The Financial Chronicle)

HOUSTON

DALLAS

na¬

from

behalf."

general partner.

beoame

4, N. Y.

Huey Staff

in

that

been

a

in

N. Y.

CLEVELAND

resulted

the
mu¬

City, known

lot

nounce

Building, Spokane, Wash.

j

DETROIT

PITTSBURGH

house

est

Co.—Analysis—Stanley Heller & Co., 30

C.

CHICAGO

that

out

In Lebenthal & Go.

Shares, Inc.—Bulletin—Cleek-Tindell Co., Inc., Paul¬

&

its

Lebenthal &

in

DENVER,

6,

mu¬

W. J. Beahan Partner

Gannon,

Street, New York 5, N. Y.

DEPENDABLE MARKETS

York

or¬

Bissell &

York 5, N. Y.

Mallory

New

"has

in

effort

-

Corporation—Analysis—Van

Sprague Electric

«

pointed

full scale research

a

ice

America—Analysis—May &

Street,

United States Rubber

Association

service

and

than 100 established

basis

started

Dealers

ap¬
mu¬

funds, but more impor¬
tantly, the maturity of this invest¬

Street, New York 5, N. Y.

Huey Co., Ferguson

Members

been

mutual

Meeds, 120 Broadway, New York 5, N. Y.

Truster, Singer & Co.

York

announced

ment method and the related need

American

Joins

Perkin-Elmer
•

New

has

continuing study showing conclu¬
sively, not only the popularity of

Pfd.

Heintz

sales

Dean

tional

Sound Co., U. S. Ply¬

reports on Howe

Hycon Mfg.
•

has

Dean

expansion of Harris, Upham's
tual fund department
on
a

Suggestions.

New.York

of

the

more

Mr.

&

are

Corp., Royal McBee Corp., E. I. du Pont de Nemours,

Wallace

Corp.

of

Exchange,

Howard

tual funds."

Electronic Associates
•

members

designed to provide a
clearer understanding of contem¬
porary mutual fund benefits and,
through independent research fa¬
cilities, the specific evaluation of

Oil, Drug Industry, Atomic Energy Stocks and Switch

sen

Radio

120
na¬

ganization

Kidder, Peabody &

—

Shell

Aircraft-Radio

Corp.
Burndy Corp.

investment

"expanded
&

wood

Uranium

Corp.

in

and

pointed partner in charge of

Organization,

Company—Analysis—Harris,

Vending

Carbide, and

free

each

tual funds sales to head the firm's

5, N.

5,

the

on

care

Co.,
City,

and

Memorandum

Broadway, New York

based

firm with 35 offices coast to coast

Y.

—

Wall Street, New York

Vork

Co.,

York

distrib¬

nonprofit

tionwide

& McKinnon,

Corp.—Memorandum—H. Hentz

Industries, Inc.

be

Harris,
Upham
&
Broadway, New York

Street, New York 4. N. Y.

New

way,

will

voluntary

Funds Facilities

Broadway, New York 5, N. Y.

McLean

appeal's $3,500,000

Harris, Upham Expands

Smith,

—

Stock

Aircraft

ac¬

hospital
gives to the medically needy.

that

Beaver

the

Higginson Corp.,

Broadway, New York

Ill

direct

volunteer solicitors

hospitals of the fund

below-cost

Corporation—Analysis—Unlisted Trading Dept., Rm. 707,
& Co.,

of

division goal of $225,-

a

80

amounts

as

•

to

member

Signal Oil & Gas Company—Analysis—Dean Witter & Co., 45

United

Along With Many Others, We Trade and

74

&

Cold.

Company—Report—^Thomson

Shoe

will

150

Contributions
uted

2,

Mason

Group

goal.

Meeds,

Montgomery Street, San Francisco 6, Calif.

is

Electronic Association President, Dr.
an

&

of

who have

Street, New York 5, N. Y.

Sheraton

Electronic Stocks
industry

Bissell

Bogert

000 toward the

Wall Street, New York 5, N. Y.

Inc.,

This

Railroad,

Products.

Chicago 4, 111.

Street,

Jr-

Professional, Fi¬

Insurance

and

tivities

Haupt

Phillips
.

Ohio

&

Thompson

and

Denver

"• Lav"

the

appeal.

Mr.

Ziegler and Company, Security Building, West Bend, Wis.

11

&

.

Baltimore

Manufacturing

14

Presbyterian

C.

Pan

DEALERS

Salle

La

Electric

Barney

Union

for

selected

Harris,

performance

Quotation
N.

nancial

fund

Corporation—Analysis—Loewi

Building,

of

of

chairman

Gimbel Brothers, Trans-

Controls Co. of America—Memorandum—Lee
231

Bank

New York and

Mangel Stores—Analysis—Winslow, Cohu & Stetson, 26 Broad¬

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

and

The. First

—

Company—Bulletin—Lackner & Company, First

Bank

the

of

National

City

Co.—Bulletin—Laird,

Refining

Cook,
Presi¬

-

volunteer solicitors for the annual

on

Co.,

by A.

First

Analysis

—

an¬

was

dent

a

Broadway, New York 5, N. Y.

Lockheed

yield

Also available is

Corp.

Y.

data

Koppers

L.

appoint¬

Halsey

Koehring Company—Bulletin—De Witt Conklin

Co., 655 Madison Avenue,

International Oil Shares—Bulletin—Herzfeld &

used

N.

Lines,

Air

Y.

N.

are

United

Yamaichi Securities

—

Co., Ltd., Ill Broadway, New York 7, N. Y.
New

Also available

Martin,

Ira
Into

New York 5,

America,

Knox

Current information

—

Praising

Vice

Corp.—Data—Bache & Co., 36 Wall Street, New York

International
Status

Broadway, New York 4, N. Y.
Japanese Stocks

Look

Place,

Lmerson

United

the

d's

n

nounced

Engineering—Analysis—Lapham and Company, 40 Ex¬

5, N. Y.

120

60

Y.

Republic Steel

on

Corp.,

Incorporated, 225 East Mason Street, Milwaukee 2, Wis.

7/,N. Y.

Holidays

5, N.

Investing

Corporation, 100 Broadway; New York 5, N. Y.

Colorado

original issue and transfer tax rates

—Registrar and Transfer Company, 50

u

F

fund

Inc.-r-Memorandum—Oppenheimer &

Ilocking Glass Corporation

Boston

Clark

York 5, N. Y.

Taxes—Booklet

Transfer

General

—

Co., 25 Broad Street, New York 4, N. Y.

stocks—Bruns,

common

Co., 52 Wall Street, New

Federal and State Stock

York

Export Lines,

-

Glenn

able is current Foreign Letter.
Canadian

the

Hospi-

ment

Repcrt

—

Street, New

Carrier
View

Divi¬

of

t a 1

Bonds—Report—Dean

Revenue

named

Investment

&

United

Other

Petroleum

change

Street, Boston, Mass.

Burnham

sion

been

has

the

Ex¬

changes

P. O. Box 166, Arling¬

Co., 14 Wall Street, New York 5, N. Y.

memorandum

Street, N. W., Washington 7, D. C.

Building for the Future—Leaflet describing plan for accumula¬
tive

L.

copy.

and

Co.,
of

Bankers

profits,

Edward

—

progress

program,

&

appeal.!

American

Mutual

curities

Dillon, Union Se¬

77th annual

Company and Newport News Shipbuilding and Drydock Co.
Development

per

&

Wall

—Atomic

$2

Bridge

Turnpike,

Natural Gas, American Machine and Foundry, Foote Mineral

Thirtieth

recording

for

system

interest

Bogert, Jr., part¬

Eastman

chairman

Canadian

Westinghouse,

on

in

His

contracts, atomic merchant ship

atomic

Va.

10.

ton

Witter

additional

on

G. A.

—

Pine Street, New York 5, N. Y.

Simplified

—

Comparative figures

—

Hospital Fund

Lawrence

H.

Stock

losses,

Interest—Quarterly dealing with advertis¬

(No.

United

Walker

H.

ner

Law, Inc., 131 Cedar Streel, New York 6; N. Y.
Letter

Industry,

Co., 1 Wall Street, New York 5, N. Y.

Public

parties the following literature:

ing and public relations— "Editor," Albert Frank-Guenther

Atomic

Heads Drive for

Metals,

Industry,

Electronics—G.

Weaver Associates—Securities Diary,
AF-GL Views With

Oil

Industry, Chemical

anci

Utilities,

Markets—

Financial

and

covering

—

Rubber

Industry,

and

Business

forum

a

Thursday, December 13,1956

.

.

.

ncMDcrv TrnrirD

o

on

UlIYIi

Heasler> Jr

cx

uU.

Company,

ol i "

I LUlLlK

Building.

is with Lacknei- &
First

National

Bank

has

Colo.

become

Cruttenden,

—

Podesta

National

Bank

formerly

with

Securities

Corp.

Robert

affiliated

&

J.

with

Co., First

Building.
Mountain

He

was

States

Volume

Number 5594

184

.

(2505)

Chronicle

The Commercial and Financial

.

.

help

Chemical and Pharmaceutical

tinue

McKEEN*

drug
than

may

it

the

that

foolishness.
Those

words of
t

d i

r a

are

con-

tion.

c

likely
the

treats

Dick¬

Charles

used them

ens

begin

to

his

of

Cities"

nearly

century ago,
was
de¬

a

This

diction

which

era

an

—

proposition,

pened

an

contra¬

of

era

of

one

any

industry

chemical

the

to

during the first half of this year.

During that period, automobile
production and sales
both de¬
clined, as did a number of other

saw

goods.

durable

of

John E. McKeen

too,

prosper¬

months

British

in

bloodshed

It

France.

a

was

economic
long since

iri

point

highest

isolated soft

new
for

The

spots in the economy
effect; instead,

little

industry

called

world and our own times

evening, for the. world
in-which we in the chemical in¬

the

our

own

this

yery

dustry must Jive and
business is also one

conduct our
paradox

of

and contradiction.

These
Never

dustry

have

before

and

such

with

"best of

the

are

an

as

failed

wholesome prosperity.

Yet, when we turn to the Middle
East and to Eastern Europe, we

certainly confess that these
"the worst of times."

must
are

This

is

growing

this

means

wisdom

of ^technical
„

at

least.

,

.

,

.

Sconce has created opportunities
for. a future of unparalleled abundance.

But in the same breath we

it

must also confess
—

to face with

cast away all that

industry

economic
Where

"age of

for we stand face
ideologies that would

foolishness"

and

as an

can

peaceful science
offer, in favor of

and military plunder.
do

stand

we

now—to¬

In this setting of contra¬
dictory world forces, answers are
not always easy to uncover, but
let us—together—attempt to do so.
It has been a good many years

the chemical
industry as a whole could be de¬
scribed
as
specialized; today, it
is almost universal. It is now the

since the days when

other

supplier to almost every
industry, so that a pro¬

nounced

uptrend

or.

downtrend

throughout our general industrial
economy
would, of course, be
reflected in the long run by the
chemical industry as a whole.
You are all aware. I am sure, of
both the nature and the multiplic¬
ity of these inter-connecting fac¬
tors.
We supply the automobile

with plastics, synthetic
rubber, paints, and a host of other
products. We supply agriculture
with insecticides, fertilizers, soil
conditioners, feed supplements,
industry

pharmaceuticals, and many other
chemicals '
farmer

w

i t h

could

o u

not

day's economy.

I

t

which

survive

in

the
to¬

need not mul¬

tiply these examples, because it is
not really the specific examples
which matter in any case. What
•An

the

address

35th

by

Annual

Mr.

McKeen before
of the Syn¬

Meeting

Organic Chemical Manufacturers
Association, New York City, Dec. 3, 1956.
thetic




the

only

against the

such

diseases,

were

marketed

are

far from the

forts

added

(Canada)

CURRENCY ISSUE DEBENTURES

1956 UNITED STATES

FOR LOCAL

IMPROVEMENTS
Due

Dated January 1,

1957

4%

added to

4Vz

5.40

1969

4l/z

5.40

1970

4Vz

5.45

1971

4Vz

5.45

2,000,000

250,000

19681

1972

4Vz

5.45

4.50

4.75

increasing at the explosive rate
of 80,000 per day—as
though a
whole city as big as Springfield,

5.40%

2,000,000

4Vi

1960

Yield

4Vz%

1,500,000

1959

Rate

1967

Amount

4.00%

500,000

Maturity

250,000

4Vi%

250,000
250,000

1958

more

than

hour. On
population

285 new customers every

world-wide basis, the

is

111., were automatically

time the sun rose.

the map every

such

second

factor

is

the

steady rise in the Gross National
Product since the last quarter of
Not

1953.

reached

only

a

the third

accompanied by declining inven¬
tories, an indication that even this
huee output is not keeping pace
with demand. It would also seem
that
consumers'
disposable
in¬
ward

the

climbing
$290

rapidly

billion

ing rate, despite the fact
sonal savings have also
their uptrend

this

the

is
increas¬

that per¬
resumed

this year.

chemical

to explain why
industry expanded

American

Chemical

Society

shows that our growth rate
greatest of all manufactur¬
ing industries.

survey

in the

The factors I have

mentioned—

marked and
easily traceable influence
upon
the entire chemical industry are
of even more profound importance

which

41/4

250,000

1962

4%

5.10

250,000

1963

4 v2

5.20

2,000,000

1973

4Vz

5.50

250,000

1964

4%

5.25

2,000,000

1974

4Vz

5.50

1965

4Vl

5.30

2,000,000

1975

4 Vz

5.50

250,000

4%

5.35

7,481,000

4Vz

5.50

1966

1976

250,000

The Prospectus may

from only

;

exert

such

be obtained in any

such of the

State in which this announcement

undersigned and other dealers as m$y

offer these

Shields & Company

securities in such State.

iiornblower

Salomon Bros. & IIutzler

& Denton,

Coffin & Burr

& weeks

Burns Bros.
Shearson,

is circulated

lawfully

IIalsey, Stuart & Co. Inc.

Savard & IIart

helps

i plant and equipment by $1V2
billion in 1956, and why the re¬
cent

1961

to¬

mark,

actually being spent at an

All

250,000

5.00

has the G. JST. P.
S414 billion in

quarter of this year, but
1955 it has been

now

$

record

since the end of

come,

below

added)

(Accrued interest to be

$500,000

slightly

January 1, as shown

RATES AND YIELDS

AMOUNTS, MATURITIES,

Yield

That's

buy these securities.

The City of Montreal

Rate

A

our

research

New

story.

have

Maturity

year.

and

Bell, Gouinlock & Company
Incorporated

Incorporated
.

Gairdner & Company Inc.

Gregory & Sons

IIammill&Co. Strour&Company Swiss American Corporation
Incorporated

Tucker, Anthony

H.Hentz&Co.

& R. L. Day

December 12, 1956.

Burnham and Company

Johnston,Lemon&Co.

F. S. Smithers

a

best

ef¬
Yet
research, no matter how
whole
new
fruitful, becomes academic withclasses of drugs to the doctor's
Continued on page 100
arsenal. Two familiar examples—

whole

feed,

we

Americans each

more

stagnation

hope for continued progress.

the

o£

just

of the industry are
indication enough tha,t research is
our
best insurance against eco¬

two segments

nomic

But antibiotics are

Amount

million

particular

examples from

few

These

espe¬

drugs.

two-and-a-half

house

and

which

effective in knocking out
certain germs which have resisted
attack
by
all
other
available

cially

is not an offer to sell or a solicitation of an offer to
The offering is made only by the Prospectus.

Th/s announcement

In our coun¬

that

requires

clothe

affects
of the

economy
but that

'States

it

as

in

increase

whole world as well.

try,

mention plastics in

I

$22,481,000

which

population,

United

products now in the test tube.
is a great deal more to

must

on-rushing

world

research

customers for its fu¬

over-all

One of the major factors

the

is

a

night?

basic

increasing

an

industry

we

to find.

and
supply

groups

age

emphasis upon drugs

will follow in
look for factors
which exert pressure on industry
as
a
whole. These are not hard

of wisdom"—

"age

an

more

There

more

to

upon

Thus, to predict what course the
1957,

Thus success¬

merization, irradiation, and the
development
of. new
catalysts.
Growing interest is also evident
in foamed plastics and in vinyls,
both of which accounted for heavy
construction investments in 1956.

Industry

Pressures on Chemical

chemical

the

in

appreciable

any

depressing effect upon
chemical production.

in¬

slashes

deep

and

industrial activity

in

have

to

the

as

Even

whole.

a

basic

so

pharmaceutical

ture

pediatric

terms,

during the third quarter of 1956,
as
a
result of the steel strike,

thrived

nation,

a

as

we,

times."

as

economy

cutback

a

As

you

,

yet those same

our

a.

creates

and specialized preparations

these

paradoxical "rolling readjustment" which at, degenerative
phrases from the past characterize that time was acting to stabilize
And

mention

example.

these versatile plastics seem certain to appear from the wide
variety
of production
methods
now available, especially in view
of the
rising
interest in such
steadily rising level of processes as low-pressure poly¬
factor

infectious diseases.

formulations for
children, new geriatric prepara¬
tions for the elderly.
In practical

new

the

reflecting

was

be

more

the

history.

Research invest-

death rates for most of the major

ful

industries will

ceutical

adverse

had
our

which has
passed into history.

paradox

chemical

Yet

1956.

by May of this year it was at

and

political

of

world

and

strife

chaos,

and

Empire,

of

the

to

changed its age pattern. Modern come. Recent research is opening because this field has created a
drugs save lives in all age-groups, up whole new ways of thinking revolution in chemistry which has
but their major impact has been about both preventive and thera- reached intimately into the daily
felt at those ages where death peutic medicine, whose very im- life of every citizen, bringing our
lurks closest; in infancy and in
plications remain to be puzzled industry closer to the ultimate
old age. There are now far more
out.
In
the
meantime, we are consumer than it has ever been
young people and old people, in far
from
having exhausted the before. In addition, plastics demproportion to the middle-aged, concepts which were new to us onstrate what I have noted earthan there were 10 or 15 years
only 15 years ago. In antibiotics, lier — the many inter-connecting
ago, and the disproportion—if that for
instance, new and more power- factors which tie the chemical
is what you call it—is increasing.
ful
agents are still being
un- industry together and bind it to
Thus, the chemical and pharma¬ covered.
Only recently several the economy as a whole.

output continued to advance, and

a

ous

during

dipped

a

health,

The rise in the general level

building,
first six

Home

the emergence

plastics,

ethylene

single outstanding

industry, with some sources esti-

ing in

a

our

well ex¬

was

as

other
poly¬

population is, in part,
due to research developments of
the chemical industry—dramatically effective new drugs, result¬

well-established one;

emplified, I think, by what hap¬

he

scribing

of

doctor

in

industry—in

importance

the

of

running at about 3% of sales,

the

in

Even

The family which feels
the other hand,
family

more

areas

assume more

increase in

by of health has done more than increase the population. It has also

affected

seriously

be

fortunes

not

are

we

The result

necessity rather than a luxury—a
curious reaction, certainly, but a

instead, an economic
trend
strong enough to exert a
long-term effect on the chemical
industry
must
first
affect the
economy as a whole.

Two

"Tale

industry

an

the

and

production

and

F°r the pharmaceutical segment, mating production at 800 million
the figure is between 4 and 5%.
pounds by 1960. New forms of

itself well-off, on

customers;

when

And

as

now

visit

be an increase in self-medi¬

tion drugs.

of many segments of the economy

age

to

but
it certainly brings
about declining sales of prescrip¬

really counts is their vast number,
the age In other words, we ' supply so

was

tend

laboratory

know, this is one of the fastest growing fields in the chemical

ment

cation,

the best of times, it .was
was

pinched

their doctors less often.

-

it

are

Our

chemical industry is

committed to it.

industry, perhaps more so
casual glance would reveal.

books

appropriations will decrease the likelihood -that tax relief
bolster profits; anticipates tight money market to
continue for six or eight months which may temporarily

wisdom,

a

I

ment of arthritis.

research continues to

of this dependency
and is thoroughly

aware

tension-relieving drugs

and the cortico-steroids for treat¬

Everyone in the indus¬

research,

on

People who feel that their pocket-

dampen plant expansion in some segments of industry; and
sees overseas plant investment as a way to cope with foreign
chemical competition.

of

high level of dispos¬

the

—are

failure of their research

or

try is

will help

the worst of times;

cess

in part

able income also acts to favor the

aid

was

next year.

drug sales

A continued

but higher costs will produce profit-margin squeeze.
Mr. McKeen believes more defense spending and larger foreign

"It

in

programs.

in 1957,

•

advance

rise

past

reflects the increase in population.

chemical industry can look forward
sales volume increase and relatively stable prices

moderate

to

the

over

to

This
;

Chas. Pfizer head states

!

—

10 years,
with the exception of a short dip
in 1952—can be expected to con-

Industry Outlook for 1957
By JOHN E.

1

sales—which have been advancing

steadily

President, Chas. Pfizer & Co., Inc.

1

v-""-

["1,M

and spectacular ones from the
point of view of the market place

reserpine and other agents against
high blood pressure, and protec1
—:—
tive medications such as vitamins
and vaccines for children,
Inside the chemical industry itself, individual companies make
their own future through the suc-

pharmaceutical field. They
explain why drug industry

to the

9

& Co.

New York Hanseatic
Van Alstyne, Noel

Courts & Co.

Corporation
& Co.

10

(2506;

The Commercial and Financial Chronicle

for the automobile industry,

year

Automobile Sales

and

Prospects
And Salesmen's Opportunities

tapered

could

put it

second

a

very

The

basic

about

as

attributes

the

optimism

about

1957

and

of

prosperity

continuing to be
ployment

the

levels

which is said to give every indication of
continuing. Commenting on the opportunity that exists in the
1957 market, Mr. Colbert discusses the problem of intensifying
salesmanship, and depicts the big problem of controlling

is

ris

the

With

great

kinds

to

of

Year

the

of

intentions.

products

many

that

are

loaded with

,

happy about what

been

selling feaand

tures

talking points,

able

lies

ahead

in

that

Forecasting
Let

about

the

selves

going

to

great

a

opportunity in
the

year
ahead. We all

know,

Colbert

L.

selling in
from

this

a

look

time.

nomic

very

But

made

rot

is going to be lar
pull. The forces
big national market

1957

ext year

big

favorable at
markets

are

by the underlying eco¬

factors

It

alone.

takes

the

fenius of American merchandising
to lay hold of a favorable market
potential and then make the most
of it

by putting the real spark into
It takes the

people's motivations.
massive

pre-selling efforts of na¬
advertising.
It takes the
person-to-person
persuasion
o f

tional

the

effective

the

retail

salesman.

It

who

manager

takes

knows

how to create the atmosphere and
conveniences
that
make
it

the

and pleasant for the customer

easy

to

buy. And
add

can

all

to

up

a

of these efforts
national tide of

buying that will make the

coun¬

the

a

automobile

tremendous

business

amount

of

we

fig¬

uring to try to determine the size
cf the potential market ahead of
We

us.

put

through
search

our

a

lot

of

computers,

customers

our

statistics
we

more

re¬

thor¬

oughly

perhaps than any other
business on earth, and in general
•From
fore

the

York,

an

address

Sales

Dec.

4,

by

Mr.

Executive

Colbert

Club

of

1956.

be¬
New

next

now—how big a year can 1957 be?

will limit it to the size of 1956?

Forecasting
business

when

dan¬

a

no

one

can

finance

investments

days,

taking such

predictable

it

course,

with

an

is

un¬
even

more

difference.
clear

can't plan
without

an

and

be meeting

quarter of

million of the

a

forecasting.

Given

We

for

the

right

way our market

ahead

vear

looks

to

us

In

general, we believe 1957 ap¬
proaches the potential of 1955 as
of

one

iroarc.

were

of

the

industry's

Tr\ 1P55,
sold

know

by

1956

at
was

biggest

million four

seven

thousand

passenger

retail,

and

this "as

nearly

six

In

million

all

cars

be

enough to rank 1956 as the indus¬
try's third highest year.
By all
present indications the retail marv#»t

for

cars

in

with

now.

putting

six

is

million
an

months

and

should

I

Cash
We
the

it

as

behind

is tide to

encouraging

and

hear

credit

cars

b'g
of

deference

between

do in

we

have

we

vet

—

all

that

about

it

the

is

tre¬

check or restriction, but in
quan¬
tity that should supply good risks
sound

terms.

'You will

with

and

terms—

easy

the

the

result
of
reducing- the
people coming back into

market

new-car

not

am

say

extended

was

too

on

people

some

that too much credit

1955

in

1957.

going to comment

matter

at

aiiv

leneth.

The

I,

this

on

Fed¬

conducting a com¬
study of instalment

credit, and

its conclusions

verv

I would

of

Furthermore,
centage
new

the

new cars

of

plan

people

ex¬

who

1955

have

coming
1957

credit

back

—

any

per¬

instal¬

already naid off
will

or

have

by automotive in¬
obligations from

into

the

market

thmi

more

them

is

good
the

a

m

these

ahnqH,

important

already
ynar

model changes

believe

business

very

have

I

that this jjj

fact,

mentioned,

of wde-spr^d

the industry. We

industry-wide

chances should

put

extra

an

kick

in next year's market.

Our

telling

own

us

dealers

have

that there is

a

been

big dif¬

between
this
and
any
other new-model introduction
pe¬

they

can

other.

any

We

remember.

entering

are

are

going

In pre¬

using

and

real

values

awaiting him.
to

also

need

B"t
a

ards

ne«d

energetic

marke* cf
s°en

since

And

we

We

canvassing of
v<

befec-o

the

hr>«—

World

going

are

on

going to

are

ir--jh

a

are

IT.

War

.

to need

more

demonstration rides, more follow-

attention given to old custom¬

up

more
selling talk b^sed on
thorough and practical knowledge
of the product.

ers,

We don't

need

to

be toH

pVmj*

prospects,

people

for

needs

who

creased,

would

salesman's

anv

have1 not

Telephone

inspect
bear

whose

be

the

;•

invjWipn <e
pr«v3un+s.
this

we

are

relationship

of business

ness

creation of

mechanism,

tomers,
new

in

New

ing

from

the

time is the
new cus¬

business

of

con¬

manage¬

purchas¬

that will support those

power

lead

better

even

to

the

building

Seen

ones.

in

this

light, the job of building the big
market

of

the

future

is

nothing

less than the building of a ereater

and

a

your
one

stronger

This is
job. And it is
take pride and satis¬

job and
we

can

faction in

country.

my

doing well.

Townsend, Dabney to
Admit P. L, Winslow
BOSTON,

Mass.
Townsend,
Dabney & Tyson, 30 State Street,
,

members
Boston
1

a

matter of wo»*king

un¬

in the automobile

ever

us

means

the

to
us,

living

of. the

every

their

to

idea,

that

Stock

York

Exchanges,

and

Jan.

on

Winslow to

the

Jackson,
firm

Jr.

Dec.

will

retire

31.

Two With Marshall Co.
(Special to The Financial Chronicle)

CHICAGO,

111.—Millie

and Katherin D.

sem

E.

Kal-

McRae have

become connected with The Mar¬
shall

Company, 30 North La Salle

Street.

will

who

them

help

business

a

Two With Smith, La Hue
(Special to The Financial Chronicle)

ST. PAUL, Minn.—O. Georfrey
Holmer and Frederick R. Trumare
now with
Smith, LaHue
Co., Pioneer Building.

mer

,

vear

New

will admit Peter L.

everv

success.

It is not onlv the

—

the

closer

merchants

information
make

points

bringing

assistance,

of

partnership in the firm.

sales

system. For
business
it

them

our

standards

new

markets and
of

har¬

all

of

man¬

entering,
and

derstanding at

bit

is

markets,

markets,

from

office to the m-'«hhorhood dealer, is essential. This har¬

every

new

ment will also create the

planning

than

economic

sumption. Bv the creation of those

all parts of the sell¬

mony among

is

greater

agement—because the main busi¬

but
as

or

like

period

close

mony

prime

this

James

ing

broadest
the

cipal function of all business

receptive

Sales Opportunity
In

its

holds

perspective, marketing
will become ineT**a£,ingJv the
prin¬

in¬

mu"^

so

ne"

eases

have

Atlanta, all around the circuit.

the

who

am

York, in Detroit, in San Frarciseo,
in

and

In

whose

attention,

had

contort

the

of

cars

replacement,

transportation
to

in

word

—

We still hear about solid

overdue

who

espe¬

strength.

going

emphasis

new

personal selling.

that
a^e

we

man¬

alo-g the line,

responsibility for keeping the
countrv on the move
driving it
ahead toward higher living stand¬

continuous

telling him. abo"* j*1! tv

the

meaning

selling. We are going to need the
big. initial boo«t that **o
from

on

bigger
continuous

But by and large the
is off production and on
distribution. It is the marketer—

top performance in all the arts of

keep

business

and

pressure

the

effective pre-selling. W<* win nee*-1
to
let
the customer know,
and

of

new

means

plan ahead.

oer;or1 when

a

to need

This

cially the kin.1 of management
that knows how to look ahead and

it n°*»ds for lasting serv¬
ice to the public.:

we

aspects

help to create

prices attractive—and sound

does if

nor

selling, we will con¬
top performance in

need

agement all

neither

dealer structure

take

work—can¬

product innovation—efficient pro¬
duction to keep costs down and

busi¬

our

It

have had

we

going-to

persuasion.

other

markets.

strength

represent

ference
riod

or

in

those who

additiqn to all these poten¬
for

really not good for

to

the

that

Thni

respects.

bought new c^rs in the
years be¬
fore 1955 will be limited.

tials

is

is

persistent

personal

all

produce in the long run what we
and our dealers are working for.
ness

It

past.

and

tant increase of effort in the field
of

kind of razzle-dazzle selling won't

It

than

of it

more

the

tinue

of ' sePin^

their irmnts.

on

of

Right along with the all-impor¬

down,
trips to Cuba

bu*in°ss

our

savings

going to require
high order—and

vassing people and moving them
buy through the application* of

nothing

who

them
paid off sometime during
the next year. What this
means is
that at least two of
every three of
tho new car bwvers in 19^5 will
limited

to

personal

is

the arts of

that

the industry's d°fieienci°s in th°se

purchased
the

on

these, obligations,

be

ing

automobiles

the

to

the come-ons—instead of stick¬

as

the kind of
in recent

at

known

a

the

that

paid cash.

substantial

a

in

cars

show

in 1955

those

with

—

people

hard

the

think

whole realizes

mink coats and free

point not,, how¬

studies

our

40%

bought

are

soon.

like to

that

to

customer

new

hear

I

for

in

people

many

have

to find investment out¬

lots

lasting good can come from
dangling gimmick deals before the

seems

studies

there

mendous purchasing noweix
ready
for th« right nroduct—that there
is
crodU
available, not without

on

too
1955.

employment
we

static

a

economy. To main¬

selling skill of

no

give: the

days about

money and

made,

selling

buy¬
margin
makes

that

between

dynamic

our

kind

and

in the

activity

difference
a

lets

builds confidence in the industry's

*"

Buying

these

after

us,

big

a

of

the

1957

^

selling that,will

bring the added

years and

in the automobile
there
is going to be a

selling

will

from

personal

levels

it,

merchandising system

Credit

lot

a

restrictions
to

which

Dean Witter 8C Co.

solk'lv

long

of

shortage of

In

Due November X, 1981

will

be

as

program

not

Mortgage 4.60% Bonds, Series H

pres¬

volume of sound business.

stalment

Company

demand

new

continue to
controlling inflation. And von

be

ment

California Water Service

gen¬

basic materials, itxanthat the big nrobiem in the

pears

excellent

as a matter of record only. These securities
placed privately through the undersigned and
no
public offering is being made.

$3,000,000

inventories

on

pected

than
retail

others.

erally still needing to be built.up,
with the international situa¬

tion

when

at

in

and

prehensive

more

business

keep

Jit

who knows

business

the

1955, will take a solid
effort all down the line.

see

a

gains

eral Re«^rve is

1957

I

as

bigger than 1956 by a substantial
margin. By any standard, a year
sold

economy,

balance off losses in

with

areas

number

will

very

As

industry

some

year's

it

a

of

of

selling

is

ing and

in on it, to
shooting dis¬

within

justment—to

in

sales, but

had

highly diversified

will be sold at retail. This is more
than
a
million
cars
under
last

total

the

cash

to

1957

in

the biggest year on

wide margin.

a

cars

have

seg¬

up

It

signs point to an excellent
foj: the automobile business
1957.
The opportunity is very

bring

effort

put the extra bounce

*} and
tain

Ahead

to

as

going to need that,
the individual

we are

-

Year

But

growing

sale,vv

a

1957

All

in

pro¬

how to find
his prospect — how to transform
an
interest in a product into a
decision to buy—and how to close

year

to

clear

now.

other

made

V

.

Car

resorted

political difficulties

abroad, this is the

cars;

Excellent

kind

rea¬

a

passenger

anything like normal con¬
ditions, to make a rolling read¬

sonable working out of the serious
econohnic and

But

then

extra

our

anything we have
before, by the end of
this
month
we
expect to have
shipped to our dealers more than
a

fields—in

market.

market

healthy,

very

done

ever

other

have to grow to keep this
economy

sweeping than

eco¬

under

you

industrial operation

levels of

demonstration of the ability

of this

a

be.

may

that

is, after accomplkh'ng a
mo^el change "Aieh is more

new

in

housing, experi¬

decline*.

ments

this effort

it

and

enced

harder than usual to call the turn.
as

American

salesman

tance

But

hazardous

high

new

coming

these

In

schedules

demand

will

we

automobiles

sures

events

the

up

cars.

proc uction

great—but

And

automobile

This advertisement appears




more

days'arter public in¬

this

nomic activity were being reached
during the past year, important
parts of the economy, including

And

prophet.

are

December 12, 1956

for

it

As

In addition to these indi¬

While

35

First

borrowing 4hgse
drawing upon other

and
to

period.

ever,

were

And

plant and equipment at the
highest rate in the entire postwar

completely comfortable
plays
the
role
of
a

he

world

is

the

In

especially,

l'eel

ever

markets

trade.

gerous

record

In

our¬

market

our

of

Can it rival the record year 1955?
Or are there built-in factors which

you

do

some

a lot of
thinking and analyzing, for in¬
stance, in an attempt to answer
tne
ail-important, question right

those selling efforts

and

1957

We have been doing

stronger than it
could possibly have been without

better

II.

new

big

have asked

we

^bout

hundred

try

the

about

you

questions

year.

downhill

a

making for
i

of

that

course,

tell

me

business life—
have

that

us

future is the salesman.

and

—

everybody in
is

tells

our

means

just

our¬

burning

are

schedules.

War

however, that the future cations of strength, Federal spend¬
lead-pipe cinch.
The eco¬ ing for defense is continuing at a
nomic facts show us only the size very high level and
expenditures
of
our
total
opportunity.
And for roads and schools are climb¬
everything we know about what ing:
man

selling

kid

never

30

shortly

World

in

pre-selling — and in methods of
moving, handling, and displaying
goods. All these things have con¬
tributed
to buildingthe
big

a

nected

L.

We

business

duction—in reseach—in the arts of

asking

fill

to

selves,

is

everyone con¬

with

have

we

moment

seri¬

established

business has been

find out about their

to

high.

record

at

are

At the

troduction they sent us orders for
more than 350,000 cars.
We have

are

of

end

savines

we are

Salesman.

products

sell,

ahead of

year

all-time

an

a week
tunity and a terrific assignment;
the show-, It is squarely up to him to match
heavy the
impressive gains made
by

year

shortage of autmobiles.

a

the

source*

opinion the

at

incomes

and

wires

long-range future that

remained

embarrassed,, and

are

rising.
Personal
savings have been running, at a
higher rate than at anytime since

jnflation.
In my

is

Personal

national economy,

has

the first

Em¬

showrooms

normal in

This

Oup dealers'

is prosper¬

prosperous:

off to

days.
traffic

ously, by

indication of

every

presents to the salesman in every
line of business a
great oppor¬

week after week.
we

year

industry is that

economy

gives

year,

the

to

national

10

or

optimism

excellent

an

the whole

aealer

opening day, but it has always

room

for

reason

1957

ous

providing selling
considerably, Chrysler Corporation President

effort is increased

as

yearl' in' the

history of the business.

good chance that 1957 auto sales
biggest

the books

on

biggest

there has been heavy
in

years

1957

for the automobile

Believing there is

vious

attendance

good

very

on

the

President, Chrysler Corporation

volume could become the second

a

chance that the volume of sales in

L. L. COLBERT*"

By

think there is

we

Thursday, December 13,1956

.

.

.

ahead but

&

V!

Volume

184

Number 5594

Commercial arid Financial Chronicle

...The

.

(2507)

w./ since, the. end

Automotive Year Ahead

I

keep

1956-would

be

forecast;

it

to-able-one for them

progress* of.

with

from

in-

mu6t

intends

the demand

/

--v *:

•

?-el1i,eV!' contribute

fifty

-

six has

-been

a

*ices-

year

of

has

come

high
and

new

a

be maintained.

consumer

has

On

increased sub¬
H.

Harlow

-

22%

1955

over

to

in

_

the
_

u.

National

Gross

price

is

high.

1956 has been

year

'usual

in

one

an

re-

of

■

I

a

rising general level of busiactivity was not reflected in

a

ness

demand for automobiles,

rise

structure,

will

be less

than

•

an

this.time I did not
1956
of

would

1955.

ible

a$?o

vear

at

anticipatl that

factors

a

domestic

market

for 6Mi

million ^
passenger cars, or
about 12% lower than 1955.
.s

the

— —

1956

Sales

^

another

1956

We

and

good

"

r

'

- ' <2

,.

p

_ .

.

7

to
.

Exchgs.

Witter &

La

market

A

South

with

Co.

.

jt

c.

,

to

the

staff

Fewel

&

Co.,

453

(Special to The Financial Chronicle)

.

CHARLOTTE, N. C.—George W.

South

1
- Los
Spring ,-.4.—* members of the ■- •gtreet>
Angeles Stock Exchange.

is
Investment

Joins

exceeding

Draper, Sears

now

with

Southern

Company, Inc., John¬

Building.

Powell Adds to Staff

(Special to The Financial Chronicle)
(Special to The Financial Chronicle)

BOSTON,

truly

Mass.

—

Leonard

K.

FAYETTEVILLE, N. C.—James

«

r

-n

S. Gorham, Jr. is with Powell and

rh

_

bring

these

Is

W®.

have^ever spent ln ^ny pp^ year

for styling, engineering and me-

(Special to The Financial Chronicle)

Wlth Inv. planning

General

1957

CHARLOTTE, N. C.—Marvin G.

i special to the financial chronicle)

;

BOSTON,

Mass.

—

Walter

F.

can

..■■■-T,

.

.

Vick

has

become

affiliated

fornofation Of New Encland" He

was

formerlv

with

securities. The

nor a

Investment

solicitation of ah offer to buy

Company, Inc.

any

offer is made only by the Prospectus.

of these

'

December 12, 1956

NEW ISSUE

^

tail

demand

the

to

rate

this upward trend
should continue in 1957. Housing
starts should remain steady, but

784,402 Shares

years, and

re-;

5lis.

of

*

niillion
Since

it

passenger
is now a

.annually.,

cars

matter

more

his-

of

non

>

Northeast

residential structures

-

it is unnecessary for me to^ will be built.
.tell you why. This drop in de-,/ With the first projects under
mand, however, led me to revise • fhe new Federal aid highway promy estimate in May to 5 million,
getting under way during
1957,
highway ; expenditures
800 thousand passenger cars for
should amount to approximately
the year! And that is about in line.
$8V2 billion, an increase of at least: with what the industry is going
three-quarters of a billion dollars
tory,

(

Airlines, Inc.

Common Stock

($1 Par Value)

.

"

~

to achieve according to best esti-'

"
_

of

mates

*

;

~

from

wilL be

the

r retail

1955.

passenger

domestic

best

car

market

in

for.
the

year

sales
the

in

'

-

/

-tremendous

<

^

of these shares ate

..

-

for

demand

.

a decline.
Even so, 1956

thircj

1956.

The

*

This total represents

of 20%
,

over

production and sales in

the month of December. '

,

are being publicly offered at the price shown below, and one-half
being offered, at the same price, by the Underwriters to holders of the
outstanding Common Stock of record at the close of business on December 7, 1956, all
as more fully.set forth in the Prospectus. The Offer will expire at
3:30 P.M., Eastern
Standard Time, on December 20, 1956.

One-half of these shares

.

equipment will continue ;,
and 'expenditures
are
expected to show an in-:-

captial
in

1957,

even

crease.

history

,

Price:

$9-50

per

Share

-

Additional

Investments

,

'

*
.

of

industry.

our

As for General

*,

in

succeeded

r
'

Copies of the Prospectus may be obtained in any State only
from suck of the several Underwriters, including the under¬

General Motors capital expendi-

Motors,

we

maintaining

have
v

our

this

tures

year

will

be

just,

un-

signed,

billion, bringing the total

der $1

market_leadership in. thjs highly, in thfe postwar period to $41/2 bilpompetitive/business.
S.ales
of lion.. Our 1956 outlays represent
cots -and
trucks produced in our. the largest amount ever expended

as may

lawfully offer these securities in such State.

.

! XJnited States and-Canadian plants

by

us

/should reach
I
*

a total.of 3 million, one year.
725-thousand units. This compares.. jFor the

with

1955.

Carl M.

i

for capital purposes in any-

"/ *,/

Allen

calendar year 1957. our

million, (650 thousand in capital expenditures,are currently
However, this will be our'vestimated at $700 million.
This

; $efcohd best year

sales. %

.

of passenger-car'

...

Loeb, Rhoades & Co.

;

&

4

Company

_

-

Ladenburg, Thalmann & Co.

Paine, Webber, Jackson & Curtis

amount will be needed both to
keep our facilities and products

Wertheim & Co.

"*

Dealers

*

*

*

*

handling
General modern, and
to assure
General
Motors products have experienced* Motors adequate capacity to keep
a similar contraction in their new
"p&ce** with our apprkisal of the
car and'tfuck sales this
year, but normal growth of the market for
"v "
:-our products.
By the end of 1957
».

■

,

,r

Dec.

6,

1SS6.




Francis I. duPont & Co.

Johnston, Lemon & Co.

,

izid-hS&L' AutomobiieU*show^* New total
York
City,

;

-

expenditures

Motors

for

capital

by

General

investment

m—mmrn

Southern

mng Corpoiation or New England, He was lormeily Wltn boutnem

>
.

with

cfonin'is now with Investors Flan-* Bache & Co., Johnston Building.

~

sharp decline in

of

.

expenditures.
—

added

been

and appLances. They are. Diape, Sear ; & Co, 50 Congiess
,Mn
.
outstanding in every respect and Street.members0i the New Yoik Company, 120 Anderson Street.
iopresent_ the greatest yalue .we c
.
S
»
With Bache & Co.
;
have ever offered to customers.

that the prosperity

—Federal, state and local

BOSTON, Mass.—David Wilder
has

With Southern Inv.

Calif.—Lynda

been added to the

Hanna has

?uP^bv lines, of passenger cars,

—

;

.

Cc

-

of'$42 billidn.

area

.

White, Weld Adds

ston

„

u

White, Weld & Co., Ill Devonshire

ANGELES,

staf£

million,

with

u.

(Special to The Financial Chronicle>

Salle

previously

year.

year,

-4.u

(Special to The Financial Chronicle)
LOS

;

Sales in the first quarter were also be expected to increase some! at this estimated level. However, what from present levels.
; beginning April 1, instead of theThe construction < industry has historical seasonal spring rise, we
new records in each of the last
a

>>

■

also associated.

was

V

experienced

'

Street.

surpassed only by T955.

come

•

total of $300'billion for the year

Other government
Estimates

of

208

was

dependent on war or a peak level chanical advances. It represents inc., 68 Dev.
defense expenditures; However, .
-appears quite- certain- that def.ense expenditures will be somewhat higher in 1957 possibly in
This announcement is'neither an offer to sell

discern-*

-

'

onshire Street.

the

indicated

total

Co.,
He

,

For General Motors 1957 should

,ha? been demonstrated ; most njillioh..

equal the ,record year*

All

v

be

and progress of the nation are not

A

estimated

400 thousand this
:

another year

conclusively

industrv

♦

.<

rewel /\dds to otarr

J!1 195' should approximate 8 milL°"v 300 thousand passenger cars
and trucks.
anc* trucks. This compares with
This comnaras with

mobile

;

Dean

to other markets, unit production

It would

&

Street.

passen-

the

in

.highs have been reached that
were not spearheaded by the auto-

-

Sachs

makihg.'.Including Canada and for export

after

some

look forward to

new

:

.

q Horney, Jr., Lenard Mayrisch,
jr have become associated with
First California Company, Inc.,

(Special to Ths Financial Chronicle)

P^uditures should also continue ^Mptors-. models to market required ■
to increase .from current levels.an outlay^of approximately $630

the first peace time year in which

*

for

compared with the 1956 figure of
With confidence prevailing, personal consumption ex-- v To

'The record indicates that this is *

-

® million, 500 thousand

$287 billion.

*

consumer

to

continue to rise, possibly reaching

spects. Of principal concern to us
has been the fact that the pattern

*

(special to the financial chronicle)

SAN FRANCISCO, Calif.—Odus

CHICAGO, 111.—William C. B.
Magoun
is now with
Goldman,

§er cafs and 900 thousand trucks.

Product

in

of substantially full employment.*1
Consumer disposable income will

un-

other

certain

partner¬

With First California

Goldman, Sachs Adds

market will absorb approximate-

rise

every

It is my belief that our country
can

,

The

an-

is

seemt reasonable to expect that
the Gross National Product for
1957 would possibly be as high as
$435 billion.
/!//'•■.

averaged

now estimated at an all-time
of about $412 billion.

Kempner to

\ office, with which Mr. Mayrisch

cars

high next year. Howindications are that

new

allowance

an

Product

York and Midwest Stock

will show an increase over
1956 in the area of 10%. On this

will

present

the rate of increase,

substantially more than the ancicipated rate, with the result that

,

will

Homey and Mayrisch

.

Joins A.- G.' Becker

, ahle factor for 1957.

!

,

that experienced in 1956.

have

1956

IT

.•

the

ever,

estimated $35 billion.

Gains

»

"
'.
A-r ^a^ -in.^1956. . * tots, .Inc., U. S. National Bank
The enthusiastic reception ac- building, Mile High Center. He
corded/the industry's new models- VV£IS formerly with Carroll & Co.
-

L.

1

ship.

'

peace

there

further

a

National

Gross

.

about

.

basis

other

.

risen

Thomas

Jan.

on

serv-

:

basis I estimate that the indusproduce and the domestic

this

prospect «f

Cur tie*

stantially.
/
; >
The
conI struction industry has bettered its
amazing 1955 record, while capital
expenditures
by
business
have
-

Stock

admit

I >'.//->.> (special- to the financial chronicle)

more substan-

Loeb, Rhoades & Co.,
Street, New York City,

Exchange,

for

as

T.Kempner

M.

Wall

members of the New York

DENVER, Colorado—Dewey R.

serv e s.

the delicate balance of

level,

spending

42

With United Investors

» -

of necessity, have a powerful im-' ! Viewing the outlook for the enpact on the economic life of our tire year, I consider it very poscountry. Yet, we must assume that sible that demand for passenger

posab le inreached

To Admit

r

/. tl,;

virtually -full
{^employment, the international situation. These/
.
,
-A
[' Consumer dis- are troublous times. World events,. Predicts 19% AutoSales Increase
■

/

well

as

suppliers of goods and

?br

expanding

-an

DLAaJa«

Another is the inventory situa(special, to The -financial chronicle)
* °? the San Francisc0 stock Ex~
; Looking forward,-it is my opintion. The supply of new 'passenger'-'"-''CHICAGO, Illinois—William M.v
ange and other exchanges. Mr.
ion that 1957 will be another rec- cars in the hands of dealers as of Moore is now with A. G. Becker Horney was formerly Vice-Presiord year for business generally.' Jan. 1 will be low, whereas a year- & Co. Incorporated, 120 South La dent of Blair & Co., Incorporated,
Of major, concern, of course, is -ago stocks were abnormally high. Salle Street, members of the New in charee of the San Franekro

Nineteen

[

and

if

the

LOGO*IfflOdOcS

Predicts Record Year for Business *

/

v

with

and

I

m»

.Carl

that General Motors dealers will
continue to. maintain leadership
in this highly competitive industry.' The year should Be a profit-

operated?v^/i^dThan1^oVit!fe/?ite^ I£vej7

tiated^'Th3a t N^/t.*v

.

make

to

pace

every

makes

II

Uail

General

The enthusiastic public acceptof our .1957 lines indicates

rec-

The automobile industry will,

-

they>;have
and
profitably
m
the main. It can be considered a ^
good year too for our 26 thousand
nevertheless
successfully

an-

economy

concern

for/goods
population.

_

that

Motors

of

ance

example of the contri-

T technology

-

oth§r record year. for business
generally.
The past 11 months

General

the

to

continue

-

opinion

the

an

dus'trial

■«

General Motors head finds
1956 is the industry's third best year, and expects 6.5 million
1 new cars will be sold in 1957 compared to 1956 estimate of *
5.8 million, an increase of about 10%. Sees GNP increasing
to $435 billion with substantially full* employment. >;v.

i

as

bution
■

peace.

I said it Was my

cite

ord

Maintaining 1957 will bfe another good year, exceeded only
by 1955, for the automotive industry and G. M., Mr. Curtice
views 1957 as "another record year for business generally/'

January

leadership
Motors products.

annual expenditures for
special tools during this period."

•

Last

value

stantial

-

President, General Motors

determination to.maintainthe

our

vvill have amounted to $5.2 billioh.
is in *addition to very sub-

This

By HARLOW H. CURTICE*

presuming maintenance of

War ll

World

of

*

II

Hayden, Stone & Co.

A. M. Kidder & Co., Inc.

12

The Commercial and Financial Chronicle

(2508)

sales

of

Cosden Rides

above

Again

the

Enterprise

the

is

government

acquisitions

Consumer Credit's

sold to
air¬

being

for military

For the Business Picture

Giving effect to exchanges out¬
above, there are now z,5«4,-

Economist

lined

Under the

Petroleum

Corp. is

now

a

and

major

a

magnificent TV network program
called
"The Jazz Age" depicted
with

velocity, clarity and charity,
of

decade

the
the

Roaring

Twenties

aviation

cars

its

coifs;

and

arid pan¬

Midstream,
was

newsreel
of

the

a

clip

Prince

of Wales

(now

Duke of WindU. Coblelgb

Ira

v

i

i t to

s

o u r

highlighted the social
of
that
dashing decade.

shores
events

Prince

The

whose

sor)

on

polo

a

pony

Cosden

house guest at
the swank and horsey Long Island
in

1923,

as

estate

of

J.

Cosden;

built

started

Cosden

business

:

,

in

out

the

Ris organi¬

1913.

in

estate

an

sand, out of oil.

on

Josh

oil

S.

zation, Cosden & Co., moved ahead

rapidly, and wonderfully; under
the dynamics he personally sup¬

1924% when control
plied, until
passed into other hands; and his
rubbed

was

name

out

of the cor¬

porate title when the enterprise
(in 1925) became Mid Continent

(which, as you
know, waxed great, and cash rich;
and was merged with Sunray in
Petroleum

Corp.

1955).

presently

runs

from

year.

to be most

cated
have

production; and
abundant water supply and

New

Editor "The Journal of Commerce"

Exchange
(symbol
quotation is

In

22%, at which price these shares,
with a $1 indicated dividend, now
yield 4.5%. Less than $10,000,000

If you were to

and

managed
troleum
of

rate

project

this

for

a

other

enterprise,
annual

based

growth
well

increases

in

share

a

has

the

an

rule

so

But who

has the water; the main
refinery is within a 100 mile radius

has

Spring,

1/6th of the known

of

troleum

of

reserves

States

fabulous

(the

crude pe¬
United

the

Permian

is

custom

a

refinery;

that is, it
and

produces to specification
order.
It turns out, and

on

the
Air
Force; it supplies (from formula)
the widely advertised high test,
high octane motor fuels delivered
at
the
pumps
by a number of
major national distributors; and
its unique Rexformer unit (at Big
Spring) was the first specifically
designed one in the world to com¬
bine platinum catalyst reforming,
gasoline

delivers,

for

and-selective extraction.
tane

stock

dividend

of

in 1946

20%

Consumer

in; credit.

a

singled

Hitting the comeback trail, Josh
leum

Corp.,

gling

manfully during -the 30's,
really got rolling during the

founder's

the

and

so

These
the

preserved

this

again; and not
thoroughbred!

of

generation

Cosden,

indeed,

which, while

lifetime.

But

strug¬

the

is

tion

as a

to

Arranges

Private Placement
on

Deer

If

we

were

den Pete

as

a

variety of blended petro¬
petrochemical products.

lesser

net

over

flow

from

4,400 barrels

reserves

a

its

wells

of

day, and crude

estimated

thus

credit;

be

conveniently
of instalment

users

far

have

by

been

quite
own

preferable: to

far

enforcement of

the

arbitrary controls.

recessions, de¬

during past

linquency of p: yments records arid
loss experiences have been

con-

;

able.

-

is

It

'

.

favor¬

V

" ^

-

that the
sharp postwar expansion In con¬

coin¬

gone

of

true,

credit

sumer

Heinz E. Luedicke

There

is

White, Weld Arranges

at

above

means

of

a

underwriting
fact
per

laden

share.

public

with

offering

credit

ble—view

Secondary

prospectus) at $21,625
Which about brings us

to date with the Cosden story.
Cosden today, with its three-unit

up

Kidder

unusual

sort

transport

of
a

(plus

over

Calif.

pipeline since

—

Thomas L. Corn is now associated

20

it




jet

fuels,

which

and

gasoline, H. N. Whitney, Goadby
roughly 20% passed away Dec. 7.

aviation

amounted

to

&

general,
for

means

necessity
but

today;

the

is that

be kept

real

a

seems

bit

a

the way

course,

has not yet, under-,
test of adversity. It
unrealistic to go all

in minimizing the possible

impact of instalment credit during
when

recessions
who

potential buyers

burdened with repaymeht

are

tionary

credit restraints

Co.,

being taken out of
factor may in¬
deed operate only for short pe¬
riods since the average maturity
obligations

the

of

are

That

market.

outstanding debt is "less than
months."

nine

crucial

trends.

is

There

.The Issue

versus

controls;

to

of general credit

controversy

selective

credit'

general

monetary

quantitative controls

or

versus se¬

lective

credit

tive

or

of

qualitative controls.

Only

;

the issue down

narrows

restraints

the

of

use

is currently

market

stock

market

mar¬

being administered by the

are

Federal Reserve Board

to

one's

ponents
credit
the
at

Those in¬

Case I

danger

a

It

case.

in

seems

quite obvious that, the

me

op¬

of unrestricted consumer
guilty of this. However,

are

defenders of

times

seem

offense.

under qualita¬

Stock

control.

gins

•.

One's

always

over-stating
the

may

Over-Stating

have subsided.

pressures

That

brief

a

be a very
in the development of

one

economic

such

But

actually-

period

until current infla¬

credit

consumer

guilty of the

Although the

same

quite

pros

readily admit that there still
facets

of

about which

we

many

ficient

are

credit

consumer

do not have sqf-

knowledge for final judg¬

ments, at times they are trying to

terested in mortgage credit like to

get too much mileage out of

create the

partial facts and to wrap up the
whole package of the pro-argu¬

impression that housing

credit is also subject to direct con¬

It is true that Federal agen¬

trols.

have

cies

the

right

of

the VA and FHA
it is stretching a
that mortgage cred¬
it is under direct'control just be¬

mortgages
mortgage.

point to

—

But

argue

the Government

cause

withdrew

ago

lants to

This

some

time

some

of the stimu¬

housing credit.
is

rather

a

ments

up¬

in

their

played.
Nothing
in

;>

bringing

consumer

just

that

recognize

to

puts consumer credit on
Although it is sometimes

the spot.

argued
the
not

cal

a

instalment

that

"poor

man's

credit

money,"

this

particularly effective politi¬

argument in its favor. Actually,
argument is frequently used

this

make

to

credit
used

tion,

case

a

control

to

*An

the

out

for

because

demonstrate

address

Indiana

consumer

it

is

that

now

being
instal-

is

public

under¬
,

be more

.

effective

the whole subject
into

amount

whose

proper

To

be

totals
That is a

now

even

total

of

per¬

in

debt

an

load

approximately $700 billion,
and private debts put to¬

gether.
However,

far

more

important

than the size of the debt is its rate

is, of

is

arguments

*•

instalment credit
over $30
billion.

economy

that

seems

are

spective than—its volume.

substantial

to

often

credit

ing people like to take;

realistic

strongest

can

some

neatly.

hand, it

favor

side-down approach that the hous¬

but it is

too

the

of

some

sure,

peculiar

bit

a

On the other

prescribe

to

the provisions for certain types

approach is convincing
many members of Congress.

18 tril¬

diversity of prod¬

restraints

This

FRANCISCO,

the

this

Peabody Adds

(Special to The Financiai CBRONreLE)

SAN

no

dominant—and, I believe, irrefuta¬
must

only

and

accompanying

by
on

agreement

refinery facilities, has a through with Kidder, Peabody & Co.. Russ
put capacity of above 45,000 bar¬
Building. He was formerly with
lion C.F. of natural gas
reserves). rels a day; and it has attained the
Mutual Fund Associates.
Cosden also has its own
special reputation for being a top flight
pipeline, not for crude or gas, but custom refiner, and an
expanding
for products — such as
benzene, factor in petrochemical .manufac¬
Harry B. Hollins, Jr.
naphtha, aviation gas and high ture, turning out benzene, toluene
octane motor fuels. This is a
Harry B. Hollins, Jr., Partner in
very and
xylene.
Cosden's output of
million barrels

can

.

cide wit h a;
drive
to
lib¬

merely to view Cos¬
single unit refinery,

we

extent, Cosden is also
"producing company" with cur¬

rent

to

own

loads" and
that this has proved an effective
way of limiting the use of such

has

12,

his

feasible" "repayment

credit, j

controls

discussion

overlooks that

Even

drive for

needed

individual from

capable of determining their

Interesting¬

sumer.

be

may

•

excesses.

credit

ly enough,the

California Water. Service Co., it
announced

'

"yardstick" to

a

curbs

the

This
•

eralize mort¬
amazingly efficient plant and, by
placed
privately, through Dean gage credit
a continuous recycling process, be
converted into higher octane frac¬ Witter & Co., an issue of $3,000,000; and to make bank credit easier for
small business.
Obviously, when
tions. The end product may be a first
mortgage 4.60% bonds, series
it comes to politics nobody has to.
104 octane leaded motor gas, or a
H, due Nov. 1, 1981.
be consistent.
When it comes to
super high test aviation gas.
Re¬
The proceeds from this finane-, economics and the
development of
fining facilities of this sort are the
most sought after in
the entire ing are to be used to retire out¬ economic policy^ there should be
logic and consistency.
industry.
standing indebtedness.

name

leum and

a

.

trols" if infla¬

-

was

find

ever

buying

avoided.

Dean Witter

will

save

chains of "con-,,

rides

plater but

as a

"

feasible repayment

own

rnent

on

.

the credit pic¬
materialized, ture that has
name
is still, to be put into

—

a

been

never

Cosden

for

investors.

out
villain

Fifteen Oil

To

we

in

could, no doubt, endorse the
still had magic; and when R. L.
enterprise as sound and strategi¬
Tollett took over the helm in 1939,
cally located. But Cosden has not
Cosden Petroleum began to move
stopped, there. In July
1956 it
forward into a new order of mag¬
A secondary
acquired, for about $1% million
offering of 62,500
nitude.
Mr. Tollett had spent his
cash*
properties in the Jo-Mill shares of capital stock (par $1) of
boyhood in the oil fields of Texas
(Spray berry)
Field
of
Borden Fifteen Oil
Co. was made on Dec.
and, by determination and dili¬
County, Texas with recoverable
13 by White, Weld & Co. at $13.50gence in night school studies, be¬
crude reserves of above 1,400,000
came
successively (and success¬
None of the proceeds
barrels.
On Oct. 1, 1956 it pur¬ per share.
fully) a C. P. A., lawyer and, for
chased from Onyx Refining Co., are to accrue to the oil
company.
a
four year hitch, a member of
the Hawley refinery and related
the FBI.
Thus, when, in 1939, a
facilities 6,000 barrels a day ca¬
Fort
Worth
(Texas)
bank
was
B. J. Kenn Opens
pacity) located 10 miles north of
seeking a new president for Cos¬
Abilene, Texas. The consideration
FT. WORTH, Texas—B. J. Kenn
den, R. L. Tollett, met all the
was 40,000 shares of Cosden stock.
is conducting a securities business
qualifications—in spades! He has
And
on
Nov.
14, 1956, through
remained president for 17 years.
from offices at 3109 Ray Court.
exchange of 352,000 shares of its
In 1940, Cosden grossed $6,352,common stock, Cosden
Petroleum
000
and
netted
$179,000.
1941 acquired the Col-Tex
Refining Co.
L. H. Meierant Opens
showed some advance in sales to
(at Colorado City, Texas), pre¬
$6,472,000, but net slipped into the viously owned
DALLAS, Texas — Lester H.
jointly by Standard
loss column—$50,000 to be precise.
Oil of Texas (62%%) and Ander- Meierant is
engaging in a securi¬
Since 1942, however, the company
son-Prichard Oil Corp.
(37%%). ties business from offices at 2402
has made a
profit in each and This is a strategic addition
a
Boyd.
'
every year; and gross has surged
refinery (only 10 miles from Big
ahead tenfold over 1940. It should
Spring) processing 8;000 barrels of
cross $65,000,000 this
year!
crude per day, and turning out
C. E. Murphy Open*
...
Just what sort of an oil
company automotive
gasoline, diesel fuel,
FT. WORTH, Texas—Clyde E.
is Cosden? As you know, it's quite
kerosene,
sand
fracturing
oils,
fashionable to catalog oil compa¬ asphalt and heavy fuels.
Murphey is conducting a securities
nies as "integrated," "producers,"
The shares of Cosden Petroleum business from offices in the Pro¬
etc.
Well, Cosden is essentially a delivered for the purchase of Col- fessional
Building.
"refiner," upgrading crude into a Tex
were
forthwith
sold
(by
broad

has

as

Low oc¬

day, can be fed into this

Doubts

Time and again it is being

1953; 25% in 1954 and 5% in 1955.

materials, at the rate of 4,000

barrels

credit

In June of this year, W. R. Grace
& Co. made proposals to take over

Cosden.

secular economic

or

point where such credit becomes excessive; or, that
product quality and salesmanship can be replaced by credit.

1956; and that' the defensive long enough. That is
it split its shares 2-for-l in 1956
particularly true about instalment
after

Basin of Texas).
Cosden

has advanced from $1

to

That there still remains the

determine their

to

users

high of $25 in

a

prominent
opposed

arguments

measure

management echelon; that its com¬
to

from

uneven

>10 months of 1956.

effective,

mon

problems,

the

in

away

loads; the exaggerated arguments used by defenders and opponents of unrestricted consumer
credit; and consumer credit's
smaller rise compared to total private debt in 1955, and first

reliable?

and

an

credit

ment

estimate

Suffice it to say that Cosden has.
been moving along smartly; that it

energetic

villain

a

impact of general credit controls, is
pointed out by Dr. Luedicke. Author reviews: ability of instal¬

cheap electric power.
Well Cos¬
den, with its main plant at Big

an

control

editor advances

regulation to attain anticyclical

problem of

gross

of about $60

by Jan. 1, 1960.

slide

a

with

up

common

credit

urgent

growth rates in key industries.

operating income, and in net in¬
come, for the past ten years, you
wind

more

newspaper

ernmental

pe¬

on

far

credit is

consumer

"red herring" to direct attention

or a

standby credit controls, and terms such legislation a "pretty
hazardous gamble" since it could very well tempt
specific gov¬

animate,

sales-minded

picture

business

common.

curve

ascertaining whether

credit

in long-term debt lies ahead of the

would

crude

near

the

on

current

refinery,
price for the
efficient, should be lo-.

Anyone knows that a

listed

.

Cosden formed the Cosden Petro¬

never

run

Big

was

bigger swoonbait than Elvis Pres¬
ley and his guitar today. And the
Prince rode high, wide and hand¬
some,

a

can

gas

cho-

its

there

the

lead off, be
blocked off by any fluid (or solid)
of
substantially greater density;
then 100 octane gas can be put on
stream—and so on.
This pipeline
of

flasks; its pep,
ic.

at

and

The

By DR. II. E. LUEDICKE*

shares of Cosden out¬

Stock

CPM).

Spring to Abilene, Texas (a
distance of 108 miles) and will be
extended
to
Wichita Falls next

flappers
pace

example,

For

time.

same

all

line,

the

through

York

of

regraphy,
and

ucts

man,

and

stocks

stills;

its

—

all-time oil

and

common

standing

Cosden
pace-making Texas thoroughbred.

G-Man,

lawyer,

week,

last

Only

014

refining influence of R. L. ToIIett, President, some¬

C.P.A.,

time

Responsibility

craft.

U. COBLEIGH

By IRA

/before

recited)

Thursday, December 13,1956

.

.

.

In

increase,

1954,

total

debt

expanded $21 billion. In 1955, the
increase jumped to $51 billion.
Consumer Credit in 1955 and 1956

Consumer

tributed

credit,

only

a

in

little

1955,

con¬

more

than

10 % to the total lise in debt. Cor¬

porate credit and mortgage credit
by

Dr.

Consumer

Luedicke
Finance

Indianapolis, Nov. 26,

before

Associa¬

1956.

posed the real problems in 1955.
And they kept this key role in

Volume

5594

Number

184

13

(2509)

The Commercial and Financial Chronicle

...

.

!

Reviews 1955

■

1956.

total

will

it

increase

credit

debt

in

all

restraints

year-was not

despite

-—

probably

held

have

*

auto-

than were attained.

the

through

to significantly lower levels

year

appreciably smaller
At any rate, the rate

:

.

_

1955.

in

%

hand, showed

.

proaches, .by and large, aim at
keeping purchasing power within
the limits of produced supplies, ;

the first ten months

in 1955 For
of the year,

instalment credit

up

billion

was

total

and

tine

only $l.o

consumer

credit

clearly.

only $0.9 billion.
"There

is

in these

(1)

figures:

automobiles.

particularly

dise,
There;

in

truth

still

is

merchan¬

sell

to

the

old

to

but

water

can

you

of

The

credit as the
the dog. Consumer
dog

not be very

ail

It

•

may

this, but I am strongly
impressed by the fact that you—
as
a
group—do not really rate
attention you

the

It is

lar

are

standpoint
would be

this

type

converts as

many

of

ulation

The

controls

for standby

credit,

consumer

over

should anybody object to
such a mechanism if it is to be
activated only to prevent the exWhy

when
new

purchasing

power
to set
inflationary forces into mo¬
of

pansion

threaten

would

this

Gf

phases

year

would

to

prob-

offices

with

at

in a securities business.

gage

fjeers are Ralph Wertz,

quite

did

trolled

more

k

,,

^to

Secretary. Mr. Wertz was formerly

^

indicate.

witn A. J. Grayson Co.,

Inc.

Your eyes are
'

—

4

.

Argument

5

ever

much

-

we'll

The

find such a yardstick.

The

tion?

is good reason to was based largely on the fact that
imposition of- stand- huge bank holdings of Governby controls because it would be ment bonds plus the Treasury polall to easy and tempting to utilize
}Cy
supporting the Government
the regulation of consumer credit
bond market at an arbitrary level
for general economic policy purmade general monetary controls
poses beyond^ the fight on ini'laimpossible. Today, with the Treastion.
'
ury no longer running the Federal
The temptation would be strong Reserve and bank liquidity conto force installment credit control
siderably reduced because of largeinto
a
powerful contra-cyclical scaj€ switching from Government

life, your place in the sun,

going to quit

—

in

up

your

mind,

and grind,
yourself to the task,

the last!
give?
has to line1

finish the job though you faint at

What
To

and the race not won?

stored

eocperience gained through toil

The will to hold
To

you've wrought

acquire the skills with which

What of the know-how

ratio to discre-

;

you've struggled and fought

Just think of the years

Are you

disposable income is rather meaningless; nor is its

and quit the fight,

up

old man, that you're doing right?

The fabric of your

relationship of consumer credit to

against consumer credit
as
well as against the

give

Are you sure,

To

that

used to brag,

slump and your footsteps drag!

But before you

No True Yardstick
very

dim and you feel the cold,

You lack the vim you

Your shoulders

...

doubt

you're giving up 'cause you're growing old,

So

to justify uncon¬
credit and to

consumer

r

I

fledgling can offer what you have to

acquire your gifts, a man

—W.

G.

L.

there

Yet,

object to the

role

in

the economy.

into

bonds

the

loans,

for

case

IS
argued that qUantjtative ~ credit
controls
consumer
credit should be dis¬ quite different and the need for
couraged when the economy is qualitative controls therefore less
'booming, but should be encour¬ strong.
aged when things are slow.
There still remains the problem
This
theory is
based on the of an uneven impact of general
familiar — but fallacious — view credit controls on various sectors
that consumer credit control can
of the credit structure.
This is a
be
used
to
influence the post¬
pretty tricky issue. Tight money
ponement of durable goods de¬ has shown a tendency to reflect

It

easily

could

be

This announcement is. not an

ojjcr ojsecuritiesJor sale or a solicitation

oj an ojjer to buif set unties.

December 13, 1956

New Issue

$30,000,000

Texas Eastern Transmission
5V2% Debentures due

Corporation

December 1,1976

r

time in a cycle when

mand until a
it might

prove a

sustaining force,

of an added pressure.

instead
tion

contra-cyclical
manipulation
looks
like
a
pretty hazardous

of

gamble.
even

beyond

tra-cyclical
use
control, it

credit

of
has

such con¬
consumer

also

somewhat

terms

to

for

with our mass produce
industries closely geared to
installment credit sales, this kind
Today,

Going

itself

been

but

in

less

buyers

instalment

the

impact,

different

prob-

.

Last

sales

year,

panies which
largest single
lending

result

regulation.
idea

behind this scheme

is

controls could be
sustainable rates of
production and sales in key secroughly

tors

of

the

mobiles
-sumer

In

that

to

geared

like autodurable con-

economy,

and

other

goods.

practice, control of this kind




Co furs

ably, is largely due to the Different
magnitudes ol these two credit
sectors.

to

finance

was

consumers,

that

the

banks, both directly
this
indirect
route,
nanced

oj //it' prospectus may
{lie

ojjer

commercial

through

actually

Dillon, Read & Co. Inc.

re¬

The First Boston

Eastman

Goldman, Sachs & Co.

crease in the consumer debt during the year.
An expansion of this kind adds
to the money supply and to in-

Lehman Brothers
Stone & Webster

Elyth & Co., Inc.

Corporation

Dillon, Union Securities

fi¬

better than half of the in-

flationary pressures.

the ttnAe.rsipn.eit {who are. among

com¬

were

and

be oblai nedjrom such oj

underwriters named in the prospectus) as map legally
these securities under applicable securities taws.

accounted for the
share of net new

it to influence sponsible for $2.5 billion of the
growth
rates. $5.5 billion expansion in instalThis is by far the most obnoxious ment paper. But the finance companies borrowed $1.5 billion from
of the various techniques of con¬
the commercial banks to carry the
trol which I have seen suggested
increase in their operations.
The
as
possible
through instalment
The

from December 1, 1935

instance, in mortgage lending,

suggested to use
secular
industry

credit

Price 100%
plus accrued interest

credit
than,

Of-

President;

NEVER SAY DIE!

entirely

an

37

policy

credit

postwar

seem

production pattern.

whole principle of selective credit tionary income much more helpcontrol—can be made through the ful. One of our friends has come
use of still another approach; a up with a formula, based on his
more or less historical one.
observations, that whenever new
In the early postwar period instalment credit exceeds repaythere was considerable discussion ments by more than 2%, the red
about the desirability and need of flag should be hoisted. Others are
carrying over selective consumer trying to develop a formula for
credit
controls
for
permanent the projection of domestic autoof retail
peacetime use. The argument for mobile sales and hence
based
on
the
instalment
paper
qualitative controls at that time

concerned. It sounds so very reasonable merely to ask

..

case

control

is

credit

lieve,

,.

.

will make
far as the reg-

consumer

a

basically

formed

been

Wall Street, New York City, to en-

be un-

as

Fortunately, this did not occur
this happy experience, I be¬

harmless standby con-

Another

the

that

defense

of

not

is

Form Sees. Distributors
Securities Distributors, Inc. has

and

credit control, even in the form

Standby Controls

of

is

*

trols.

Danger

current

something

Secretary - Treasurer; and 1VT.

simple and not nearly in complex Treasurer; and Vice-President and
as various Thelma Wertz, Abraham D. Cohen,
its
involvement

clarify its function than most of
matter to control it with
-things that, over the years,
attaining"specihc have been written in defense of it
secuiar goals.' ; - • It is-regrettable, of course that
it

But

of allegedly

Unfortunately,

is

which

lem

we still have not developed any
Thus, it seems to me that a ^rue yardstick to measure at what
strong case can be made against pQjrrt consumer credit becomes
the desirability of any consumer "excessive." ■

the

credit.

consumer

been

current

J.

„

I cannot

we may

complicating

necessarily

automobile
with-

or

invented

had

nobody

have

upset the auto

thing to recognize both

one

different

of over-all economy,
exactly the same today,

if

even

from

help but feel that

about.
It would have represented excessive stimulation of consumer
buying and might have seriously

significant cyclical and secu¬
role of consumer credit in the

J

problem,

debt

The

as

sure

economy.

control.

credit

of

lems

be

perhaps

the

help but feel
being used as a "red
herring' to direct attention away,
from other, far more urgent piob- .
I

that you

the

during

paper
paper

George J.

are

worry

cannot

Actually,

is

could
could

one
one

would

getting.

are

that
that

the most important
reason why the principal of such
standby controls should be op¬
posed strongly.
\
-

say

all

Nevertheless, sometimes

pansion in automobile instalment
to what a sub-

is

it.

to

pattern. Since the

sequent Administration might do
with such standby controls.
That

diplomatic

the

is

1955

Pont

I.

Langley, President; P. A. Langley,

it.

about

going

of

way

industry now seems to work

ro s-

danger

never

right; but
that wags

tail

the

debt

sound'

The current year brought an al¬
most automatic correction of the

his Economic Report
for a Federal

Officers

Building.

with

du

Alfred

the

in

formed

is-being

lnc,

offices

No doubt, that is the

undertaken.

^ese^ve Board standby ol'consume! jn a two yearthe 1955cycle,, of constudy
the de- tinuation of model rate a exsirability
of

consumer

is

credit

have

not

January,

c°n

tail that wags
total

last

And

upon

did

MIAMI, Fla.—Langley & Com¬
pany,

research Projects that should be

1955 auto¬

of the

success

models, there would have
been no such bulge in consumer
credit. Hard selling was another.
mobile

Presi¬

obvious that

quite

Eisenhower

he asked, in

(2) It is slightly nonsensical to
look

step

one

anything like this in mind when

it

make

t

is

It

dent

adage that you can lead a horse
drink.

only

the

out

removed from
outright production control.

more
than the
relatively cheap

of

credit

consumer

be

/.

takes

It

availability

lesson

"tedd

would

this type

of

Forming Langley Go.
In Miami, Fla.

of consumer credit. Everybody Melrose, Vice- President.- Mr.
working in this field can rattle off Langley is President of Langley^
half 3 d°ZC" additional Howard, Inc. of Pittsburgh. ;

But ,t would be putUng the cart

instalment

that

shows

off

pay

consider- continuing

are

pressures

before the horse to say that con-

Thk

nrnH.i, tinn

n,i

control

credit

important

an

Mmb=

who

a

able: It must not be overlooked,
r howeveTf that in 1955 the general,

.

much smaller in-

a

this year than

crease

families

of

their automobile debt in any givat present, infla- en year plus an allowance for the
in

upward shift in family
income. These observers are currently placing domestic auto sales
economic climate was quite "dif- for 1956 at 6,500,000, with a posferent., At that time, we needed sibility that they may. reach; 6,alift and consumer credit helped 800,000 cars. ^
1
Much useful work is being done
give it to us by enabling the
automobile -industry to have a .
^
banner year • *
'
exploring the complex nature

tionary

une Mep *rom lotal Control
m mortgage credit this year will. .
This approach -would involve
turn out almost as
high as the Governmental regulation of the
$15 billion jump in 1955.
.
rate of growth of key industrial
Consumer credit, on the other sectors.
Whereas the other ap-*

than

number

be desirable

not

period when, as

_

„

.

would

It

the mobile production and sales last

that

be seen

would

returns

1956

the

all

When

in,

are

Glore, Forgan & Co.

& Co.

Kidder, Peabody & Co.

Merrill Lynch, Pierce, Lenner
Securities Corporation

,

& Beane

White, Weld & Co.

Lazard Freres & Co.

Smith, Barney & Co.
Dean Witter & Co.

J

14

(2510)
The Commercial and Financial
Chronicle

the public51.
the savings, the
t -accumulations of wealth" that are

Investment Banker's Role
In

.

owned

and

thus

moment

the

let's consider for

fundamentals

vestment banking, for
of
confusion
exists

the

a

about

this

There

is

jp'pi* most ol

,

a

ity

failure to dis¬

is

it

as

tinguish be¬

securities

tween

sons

invest¬

ment
a

per

d

n

s e

income,

this

i

and

which

to

We

in

with

ne.ves

blocks

cannot

sell.

merchants
which

of

of

we

and

to

to

us

believe

are

^rue

in

can

A

the

overover

a

Parted

the

TV

a

of

tribes^

id

n

underwriting

discharge

commit

the

.

lated

The

the

•

.

two

the

other

liability

business,

investment

c o n cerned

tvpid, profitable
capital funds.
"Lock

banking
with

turnover

plant

tor

to

the

Up"

is
its

one

Now

^

will

someone

.^.-called

.

challenge

»W

lock

r?
activities

up

f

of

several

large investment banking
ent banking
houses.
A "lock
up" means the

purchase of
es

a

company or proper-

to be held for

->ng
long

period

a
comparatively
time, maybe six
sik

of

r onths,
a
year,
or
even
longer
a assets
Lufore such year» or eve" longer,
are sold.

^^hs'

v

The

profit

may
be
of
actual

consist

day

''ent

age

values

in

it

or

some

may

of

the

be

remainrW

the

large

and

enhance-

total

pack-

represented
fhA

scter other assets
aid

physics. So he
$100,000 building a

about

drove

—

.

quests
,,

original

rAC,'u,,«

have

bv
i^cf

been sold

investment

re-

covered.

,

times

the

Joc'k up" is

only

•

r

a

long

tope of
cian

holding

period

in

the

substantially larger gains

might be realized

iir operation.

in its regu-

One important facr
be present—the
banking
nufst
have excess

ter must

louse
c.iat

time

a

be

can

and

virtually
a

capital
cushion any loss
that
com

taore

or

th

the

venture.

conventional

em

ability

to

might result

Some of

T

a

n
i

as

Sh°f!maker before
School Club of
Francisco, Calif,

San




1

a

he

record

earnings,

of

whpse

dividends
sells

stock

one

You may be able

this'

A

Quires

is

J

might

risk

welcome

this

chance

money.%

my

V

capital of

.,,-5

;+
:+

Starts

few

a

a

an-

man

ppl

aeo

q

it
if

fTrnu/<;

j,nrrnwlncr

;+

this.

So it

he

coes

g^eatin

of

fair

a

the

number

L

Ih-mctpH

pntrpnronf

to

that

needed

Kind

{his

it

of

a

Inves'or

be

can

seen

that

business

small

re-

kind

willing

of

and

investor

ab'e

to

as-

<yi-

terprise,

start

nerhans

even

for

new

capital
is

m

a

'

get

Often

require

c..v

company
o

"

te'

can

financially

dollar

; -

.

'

some

ket

is

mistaken

idea

that

the

banker represents
capital — that he

invest
well

a

co^-

it will

the

egsh

;it

ca'i

has

that you need

money
as

after

a

as

equitv

the

commercial
banker
similar examination
makes

loan.

However,

to pass,

ever

comes

the

investment

if

the burden

banker

of

011

will

to

^ lnVCStmCnt
invest in stock

of

times hurt and
angry.

He

the

some-

forgets,
^

]

matter

sort

of

-

to live

"

is

more

a

ample evidence

of

.

and

public

accept free coinage .of gold.
and

Profit

some

medium

is

the

and

our

business

do

.

or does not know, that the investbanker's source of funds is

,^e
in^

$100,000

ness

That

is

the

«

in-

,<

.

.

(

sole

tinned enters into
ty>af

for

is

abilitv

investment
to

extensive

is

money

period.

invested

in

of the comnanv,

buyer

must

be

such buyers

are

take the
needs
neeas

freeze

a

proportion of one's caoital

an

notes

the

?h?s

;\yith

coc^

stock

some

foiqpd

for

Prejudice

the
or

othev

it

and

hard to find. I.°t's

of the
eorn^ciny

$100 000
$iuu,uuu

prejudice

If

or
or

thcit

A?aiiwt

Low

Stocks
native

investment

among

bankers

against stocks that sell
for, roughly under $5, and particularly against those that sell
for $1 or less. This, of
course, rises
-

-

„

T

„

capital?
is

busi-M
cheap-;

The

bank

the

interest

which,

and

accrues

inexorable

regularity.
of funds

source

of
due

comes

The
the,

arc

acquaintance-with
the
potentials in this business, and so

and its

familiarity with the project
proprietors that others can'

gain

only

a

after

considerable

study.

;•

Next

outside

come

investment banker.

funds,

the

The banker is

likely IcT'suggest

form

some

of

security that can be repaid—to
be accompanied by some form of

in

stock participation.
The
object here is. cf course, to create

^

that

permits

the

investment,

not

entirely

return

which

one

freeze

the

of

does

Holder's

funds—or freezes them temporarian(^

course,

s -time—at

medium

a

compensation

as

Up

for

money,

cjenjai 0f

for tying
risks, for*

the

this cap-,_

of

Use

-^aj—investor will ask

least

ticipation in the equity.

,n

mind

that

rate

a

of

a

par-,

Keep in;

return

on

a*

subordinated

note,
a
preferred
stock^or whatever it may be is
po compensation whatever for the
involved. The investor

money

American

buy

e^T'lo

and

Telephone

get almost 5.5%.

He

as

ge|.

any

...

business

money—more

pU^ j^n^0 ^ bu^ be
cash

anp

cant

stock

can

W'-nne

Telephone

So the banker spends all of his
time and tries to place this small

day

sell
and

less than

or

ge|. cas^
He cannot

can

ouickly.

seu the securities of this
company;
So it takes more than an interest

issue with a few of his custom-

rate or a dividend rate to induce

ol-iln

purchase. The chance for capital
gains—the equity part of this Tn^
vestment, is actually the sole mo-

He must investigate, pcchaps
employ an expert—what does he
know about the market for variers.

mirl

dot
able inductors, or'midget mica
widgets? The investigation takes
a ^ood deal of time because the
banker
not
only
starts
fr})m
scratch in any knowledge of the
product and its market, but he
aiso starts from scratch in any
knowledge of the people who

n}ake up this company. It is far
simpler to find out sbout the old
company

reputation of one sort
tTiaTTthls'small one.
Now

a

Funds

the small

can

.intimate

admit that the in-

established large

$200 000
»zuu,uuu.

by

borrowing
is available—there is no'

next best

to

same

SU1?1'

nn

he

has

his

Let's say the

$100,000.

among

a

He

in-

amount

scurries

his wealthy clients

and tries to find

some

who

are

a.:

a :...

:„ci

—

f

»

L

tivating influence for such

a

com-

imitmen\
'

Forms

of

The

Equity

equity

Participation

participation

may

take many forms.
It might be a
straight conversion, although this
is unlikely
conversion
de¬

feats

the

rnont

of

straight

objective
funds.
common

the

of

It

repay-

be

msy

stock

3

bonus—it

may be a warrant to buv shares of

\common

-

completed

involved

is

with

another

or

vestigation.
around

in-

at some mutually agreed
This last is the mo-rt likely.

price.
it

and

often
to

the

can

be

is with

a

accompanied
warrant

management

to

or

and

option

buy

st^ck

at a simiter price.
This last provision enables management to re.

terested in

business.

putting 8100,000 in this
If

he

is

,

friends of the entrepreneur—those
wfto'TTnow him, perhaps have an

in. the light of experience, 1 would

inrlnotrvi-c

:

with

success

money

course,

trists, dance instructors, .reducing

can

tried

basis.

secure

est

same *or a man
as tor one seeking

'->0

been

common

the

yesuuent banker

has

Now where

„

profit

others

sure

investments

-

sympathetic

a

1

reasonable

a

for

Sources of

transactions.

give
I'm

>

suf-/

,

involved, the investment banker's
time and his potential on these

Wc try to
hearing-land

be

of

large scale

individuals, but;
on a large scale
Perhaps, it isn't 'de¬
feasible idea, but it is an
intrigu-;
ing one.
:
'
public

Involved

time

in

such ventures. Something
sort

success

with little

other- factor is important
perhaps oi paramount imporlance in this small business financ-

ing—that

has-'

could

medium

some

financing at

this

of

to
-

It

,

-1,

own-

business -'

our

enterprises

price—a
in many

this—

refuses

country

that,

ficient size to warrant

lasting memorial is to

the

businesses.

'

con-

the

to

little

%

.

be found in Scudder's Manual ol
when it
Obsolete Securities—so far a doz-.
fee
but

sive

reasons '-

difficult and

so

me

these

spread

be

Amazingly enough, people enter

other

the

should, 1 think, be some
through which the risks*'

vehicle

this

onn afford

w^o

Unfortunately, there is

to

"

custom- 7

this

of

some

shown

There

ri^vice he gives. People who gonsuit lawyers, physicians, psychia-

who

fpw cents out of every
ropeives in dividends,

Priced

enterprise, the proprietor is

no

...

in

.

forever.

imagination
meeting this challenge.

overcome

investment

an

ducement for the
money risk.
One other factor I have /men-

operates

...

,

a

he

certate

of

sdmewhat like a bank
he examines your credit and
your prop¬
pects and if he is satisfied
with
what he sees,
he
puts
up
the
just

point

such

seemed

measure, that is, the mar-

objection.

,

make

annreciation.

'

*

,

ment

If the

none.

or

purpose

■

it

IC

a

investment,

successful,

of

to

tain onlv

*

'

come—or

*

banker's

are

of

holders,

snecn^tiye crisks .salons, ana spintuansts expect i
—is nof concerned wi1vi
i^meri- Pay a
^e' but consultation with
ate return*, teeorrw. teat i", c^sh an investment banker is as freely
income, only r>ntc him in a higher ovouoble as the" Virtue of a.POiyt.av bracket and he is
able to re- neslan maiden.

need,

.frequently happens that,
the nrnnriptnr r»l- thio Vuicinooo lc
proprietor of this business is

risk

mistakenly
there is no

all.

the

all

all

afford

-expansion,

the

ate-

of the
capcustomers for a

invesL

enterprise is
ers

public vr.w-e'
generate to increase its own busi- worthless commodity in the wo 1
ness co dividends
out, of the
exceeded only, by the valueless

dollars

nothing

>

financing the small business1

diffused

of

would be

*

from

at

general p"b-

m^y

of

some

thelnvStment baTerfo!' j He makes *his inv^ment for one
only—capital gains—and
'J

to

relief.
!liei*

a

we

First

,is..

panv

perhaps only for work¬

acute.
«,

ment

so

there should he

a

machinery, for working

—

handicap
goes

or

income

-pvnanc,nn

ing capital but whatever
it

not for the

are

lic,

resources ot

an
for- plant

:

to

time

own

some

sequently, expensive

can

great risks, one w,vo can affo»*d to lose that oart of his
capital
which he invests in such an

dollars

"

to

the

These

to

have

relatives and'frtends^ontw s"ch
tbb—one
relXS'li^frtends^Money j"ch
os a ia ruenas. iviopcy to accent those

their
iThetr
:s0

^

his

thing, if the enterprise tails

objections to this iy*pe

of investment

Time

-1S ®ucce$s
'
1S S°°n GXr €",Astlon. The indivir'ml

,

overhead

effrontery

on

nis

more

and

sume

re¬

with

thousand

of

to

are

up

.

*

$200,000

among

and

today.

year

can

snecial

a

think.

comPany

the

willing and able his

ers

could

of

Special

—^

respects the legitimate requests.
What usually
happens is

Z ' refuses

u?meES

omia,

us

operations, and

,./AuaddreJss „br.Mri.e

capital
frozen for

how

good

:

From all

advertis¬

^

is willing to
accept the risk

long; time

One

_

I
tanking Tn,«i tb^hl"TtT?nt ■enoraneof thf banker's function,
function.
The
banking I think that all too often there
l
ouse

of

and

hand, I know
where

good deal

Needs

machine

,

that

other

$200,000

•

As

.

a

a

And

our

his

after

value

probably done this job

tunas

Western

one

for 80c and 90c.

two

V j)e substantial too

for capital.

Now

Actually,

Partners'

later

rewards

A

°Jt
of

several million spent on

Activities
,

of

company I know

small concern—and the losses

,

.

,

~

...

think

years

doubtful

up a

consumer

ing—plus the really legitimate

„

of

know

*

>■

has

ital

all
"?an who wanted to secure $5 rml-i ^ax
advantage from such a loss
lion tor a
those who seek caoital, whether
company with small.
ll5„alIy a wea)thv individual "
the amount involved is large or
earnings and a net worth of perThese
businesses
haps $200,000. All it needed was
when
they small, but the time spent may well

the

of

in

I

has

pay

loss and frozen

a

may

large proportion of

a

and

he

some

a

en, fat volumes, and still growing,
salv^g? a' as uranium ventures and small
fraction of that sum for
bis in-: manufacturing companies fail and
Invest o tod a v.
Salaries pjonq
ale} investors discover that oil is elu-.

it's

from California to the
steps of the
Patent Office in
Washington.
A

..

pnmarily

capital.

if

very respectable company

a
a

and

does

substantially increased because lie
been multiplied-must be doubly sure that the investor understands
thoroughly the
capital of $5,000. considerable risks involved.

company

some

......

really think this
been
profitable.

laws

prototype

capital to
Like any other

trie next venture.

T

the

spent

firm's

.

with

one

risks

immense,

can

four

several

On

cost to recondition,

about $15. I
would
have

object is to keep this capital liquid,
ity dispose of these
underwriting

quickly,

us

a

Were

worth

have
ha

I
1

years

reconditioning

about $1.37—cost

secu-

securities.

of

company

cities,

it

as

honest entrepreneur of

source

enterprises,- in

be

can

all

with

T^re

event

rnnnmva

...

„

of

rob-the

he

unfortunate

pany could have

chap who wanted $2,500 to fi¬

nance

radically—some

in

issues

new

wbj]e

modest

rewards

average

they commit

under-

America.

^at

1Tjany times. One

dries to conservative
clients, some ; man
with
some
revolutionary
deal only in speculative issues.
ideas for the manufacture of
autoinvestment banking firms have mobiles
he said the Patent Office

OL

and

m^mples where a few thousand
d0llars invested in a local com-

money

particular segment of
investing public. It should be
kept in mind that firms and their

only ultra conservative

Little

as

ajs0

Probgbly

&
mnconceivable proposal put up to me—the men with
wonderful ideas and no

our

differ

is

fee,

place

*

a
a mn
had about f\/f>t\r
every

the

customers

think
trunk

I
[

bonds

we

marketed, in

once

large

yle

Success and Lack of Capital

professional judgment
individual standard of

quality lead

riell

js

■

securities

Rather,

stocks

stocks

Ana *

so]icnv

as

othec.

'Unforeseen

a

to

enterprise.- He

-

our

our

rin

on

'requesl
problem—I mean

examination

capital

are

tor

decision,

wrong

he cannot

modest

possible to withdraw—it is frozen

puphases —
-tne aointy

liquidity
a

stigma

V
with; the "know how and the into the most hazardous
past judgments.
capital
> ideas."
Quarter interests are/toundertakings with little thought,
With these rather sketchy conday worth some $6,700,000 each, less
caution, and no knowledge
liberations in mind, let s see .wnatr p know another
company where-whatever of the risk they assume,
happens when a man with an idea a man
put in $5,000 about lour The millions
of dollars lost over
-or one
with a
struggling busi¬ years
ago—his fractional interest the telephone to
ness—sets about
high
pressure
financing his en¬ was bought by the
company for promoters
of
terprise.
this, that, or the
$100,000

this

nism, we are
net
James W. Shoemaker
investors,
except invol¬
untarily at times when markets
disintegrate and
we
find
our-

neil

most

in

is

small

-

promotions, 'so* this
of -shady dealing-has and

Now if these small sources of
committed to one-capital could be
tapped—arid the
of these enterprises is almost
im--$100,000
or

buy

an

is. one

business

relatively

this,

create

of

and

principal Tea-

there

?h.*4 nlunL
that nullifies

business oper¬

ned

tnat

reverse

o™Vklv

ate the mecha¬

we

but

a

<

writing are proportionately execssive, the risks are generally large,

cus-

People

gain

why

cost

liquid-

our

fraudulent

Tbis

'

the

his salesmen

.

serves

investors,
v

two

capital

inducement

vestment

n

banking,

to

us.

for

far ,in

out-

;

potn reasons may dictate

purchase

mecha nism

lor

tor

—

to

in

Loa,ls

-

been

this Price bracket. V

-

l resent

and

ranges

have

.

.

:

us liquidity of capi—

is

r»

price

these

expectations, v
:$500,000. Unfortunately, this $25,-. to risk $10,000 on a venture and
,he has created a problem and
'«000-$500,000 bracket is a no-man's if you lose
per- '
you
are
not
hurt.
I*'haps lost a customer.
"
;
land of finance'— it's the al'ea may be just as
v;
willing and just as ,'■■■
*
- /
'where capital is. most difficult to ;able to risk a
few hundred dollars
'Offers Possible Solution
»
raise, for several
reasons.7 The ana the loss will not hurt me.
-

important

as

torn ers

these

often

r-

vast

tal is aii essential and such

in

the

own

by that, anything from $25,00iHo

banking

function.

r

should

majority of investment
houses
simply do not
have that kind of money.

in-

of

good deal

a

his

amount of money—and
see

but doubts easy capital will prevent failures.
First of all,

it:

;'is asking

,

-

mends

immobilize

The proprietor of this

•/•*..
,

•

to unfortunate prejudice
bankers against stocks selling at less than $5. Recomstudy of problem relative to #mall business financing,

lie

too

attached

xV

banking function; and calls attention
among

the fact that the! gold,"the. fee
may be 5% or 10% or at most
uranium, the Canadian oil stock 15%. of the
money involved,hand *
have usually been sold.to the
pub- this may be dn cash-or in
stock ;

"

.

financed at reasonable cost, West Coast investment bankerexplains why small business financing is difficult and expensive

.

cannot

uinicuities

;

to entrepreneurs, and costly and time-consuming to the investment banker. Mr. Shoemaker
points out a special kind of in¬
vestor is required;
"lock-up" activities are an investment

j

si-

to

industry,

Thursday, December 13, 1956

.

from

investment, and in so-doing right

he

in which small business risks could, be spread

invest-

is

into

capital.

type of investment vehicle

some

The

function

funds

n-ff-

Proposing establishment of

j

those

into

By JAMES SHOEMAKER*

A

banker's

phon

Partner, Schwabaclier & Co., San-Francisco, Calif.

j \;

by investors.

'ment

Financing Small Business

{
!..

.

.

.

successful

his

tain

its control.

He

is

in

no

posi-

Volume

184

Number 5594

.'.'the

.

Commercial and Financial Chronicle

,13

,(2511)

•-

,

'

1

»

•

lion

to

'

'

.

and

he

compelled

however,

''

.

'

.

>

-

midget mica; sacrifice.

The

preferred is call¬
fixea - price, plus one
will,' share- of common, but only at.
representation-; management's option. v-Now
it's

does not want to

to

ask

'' '

'

•

.

manufacture

widgets,
be

'

- "

do

far

<

able- at

a;

He

so.

.

the

on

Board

of

wants to have

money and

Directors

a

that

of

he

—

plain that if

in how his

voice

made

be

'

capital again is to

a

in

Champion Elected Presides! of Gbass Manhattan; First Boston Elects
Seven Vice-President
Rockefeller Becomes Board's Vice-chairman
-Important changes in the senior management of The Chase.-

situation it will

this

associates' be made only at the option of the t Manhattan Bank were made at a meeting Of the bank's board of
is being
spent—he wants to have '
management. Earnings participa¬
^directors; yesterday
(Wednesday, Dec. 12).
John J. McCloy,
some say
about company
policy. tions in themselves are of ;, no
Chairman of the bank, announced that George Champion, ExecuThe
investors
in
an
value to the investor.-- *
"enterprise
Y-y-;
slich as the one we
are
discussing
These b a s t a r d capitalizations obviously are men of means —which we sometimes run across in
tbey probably have had a success¬
companies are, of course, devised
ful business
experience, their con¬ to attract ^initial
capital, but they
tribution
in
advice
can
be
of
have a way of becoming burden¬
material help to the Board.
some and
embarrassing when the

Boston Corporation;
vice-presidents
its New York office, 100 Broad-t
elected

has
at

Company

managements

fre¬

co

and gets ready for;
public participation.

quently think that the demands
of-the investment banker are ex¬
orbitant

r.pany

Obstacles

they think that the
company
they have worked to
build is being taken
away from
—

them.' As

practical matter,

a

participation of oth^r*
agement

and

in the

control

There
how

the

man-

.a

answer

company,

mean

substantial

a

gain; for

a

the

or

to us
many years ago.
I
don't recall the net worth but it
yprobablv was not over' a hunderd

to

sucn

thousand dollars.
tal

stonk

dividual.

Ah

by

jobs? for this

stock; .with a selected group.
original owner's share of the

.

or

thereabouts.

and

have

so

He has prospered

tV

individuals

who

invested with him.

Y Another

agement

business.
of

have ,in

entitled

paid

ratio of

the

for

share

a

cents.
has

this

The

is

about

was

of

rate

re¬

divi¬

any

in the

Whenever

sold

for

a

$10,

for

common

result

enterprise

a

has the right to

of

put $200,000

ment

the

con¬

and

common

one.

share

a

This preferred

.

shiares

management

buy

stock

fixed

a

on

one

preferred
the

to

then

and

dends

mind

s+ock. mhe "^"ferr^d

sold to the public.

is

hold

no;investment in

I

preferred

a

comrro"

turn

man¬

to

whose capitalization

company

sists

the

attempts

its- control with
the

'

extreme- is

which

the

is

the

and

$2,000

they could walk

$3,000.

or

away

into

manage¬

If

do

Jdon

business

in

-

product

product

to

by his

His

chief executive officers of the bank.

are

substantial

in

avoid

such

as

there

he

seen

to

many

as it
He knows
undertaking

an

his

—

business

is

these

For

some

he

If

-

could

compensation

constitute

to

as

huge

So

successes;;

I doubt that

reasonable cost.

If

than

study

more

received.

capital
low

and

rically.

to

.

business and

new

a

rewprdina

their doctors in time

modern
nate

Many thousands of Americans
«re

being cured of

year.More and

so

cancer every

more

of

going to their doctors in

are

us,

Cicicf

evkry

is that

death is
as

a

our

many

cer,

call the American Cancer

Society office
Krite
your

to

tend

impact of this

reactionary
has

of

formed

West

57th

to engage

c

•

Society




branches in

until 1955 he was

a

Cuba,

officer in

Exchange..

With Walston Co.

•

affiliated

in

'

Inc.,

Under his

America

direction

with

of

with

assuming

the bank

Puerto Rico and Panama.

in

a

SAN

the metro-

Bartling
staff

educational and business in¬

nor

a

of

JOSE,

has
Dean

and

a

New Issue

rf-

62,500 Shares

*

Fifteen Oil Company

jel"

Capital Stock

that

(Par Value $1 per Share)

Price $13.50 per

at

Share

225

White, Weld

Lewis,

P. E. Lewis,

Sec¬

was

formerly

wjth L. D. Friedman &

Co., Inc.,

Mr.

Lewis

and Benjamin

Zwang & Co.

Calif.
been

December 13,1956

&

r e e

York

i,.

and

Exchanges.

Co.

—

Mebus

added

Witter

of record only and is neither an offer to sell
this Stock.

solicitation of offers to buy any of

securities business.
P.

Stock

North First Street.

.ingenuity—

Samuel

are

New

r

Co.,,

(Special to The Financial Chronicle)

City branches. He is

This announcement appears as a matter

&

Dean Witter Adds

opened

From 1952

terests.

that

and

offices

the

Francisco

becom

S t

Montgomery

265

members

has

Walston

and was Super¬
before

Senior Vice-President in charge of

I'm enough

value

Nilsen

L.

connected

planning

Calif. —:

FRANCISCO,

Edward

administrative" and

Latin

with many philanthropic,

Not

:

(Special to The Financial Chronicle)

He joined the bank's foreign

Ypolitan department including the New York

President; Joseph Schwartz, Vice-

retary.

American Cancer

v

Street, New York City,

President;

local Post Office.

several

post.

—

H.

in

and.

cr

believe

to

stimulates

been
1

Officers
care

executive

senior

Neahj

On Jan. Ik
Nealy, Jr. will become
a partner in Rotan, Mosle
& Co
Bank of the Southwest Building/
members of the New York Stock

Jess

elimi¬

to

discipline

and

nearest you or

"Cancer" in

To Admit «l. H.
HOUSTON, Texas

Stratford Securities Co., Inc. has

could be saved.
can

the

whole.

business

Form Stratford Sees.

can¬

needless death...

For the facts of life about

Rotan, Mosle Go.

perhaps financial ingenuity.

doctors

third

bank's

the

with tho

was

York.

thinking and

interesting world.

struggle

But the tragic fact,
tell

the

discipline

time.

cer

education

struggle

a

a

of

•

soften

and

people

for
a

he

of 25

San
visor

maintaining

in

and

Present day social

•.

,

as

which

to

to

control.
.

bank

department ten years ago as an Assistant Manager

failures

cost,

equally

as

cxp^ri-nce

because they ivent

the

has been

Guaranty Trust Company of Nc:?

The finano'al stru^le is,

tle to establish
b°

prior

charge of the bank development depart¬

responsibility

pr'bab'v multiplv geomet¬

after all, a Dart of the overall bat¬

can

with

functions of

Vice-President

a

Mr. Combe

firm.

SAN

ment,

l.f

director of the Travelers Insurance
.

Mr. Rockefeller is in

Y.;yYY' Yl

;

has

it
easv

was

in

a

Company.

associated with the firm since 195:i

member of the Association of

a

vice-presi¬

a

Fidelity-Philadelphia

has been elected

offered to step

as an

formerly

United States department, the

Companies.

this problem of in¬

down to

is

He

City Bankers and

we

problem will ever be solved,
and perhaos it is best that it re¬
main
unsolved
although it does

\

Reserve

officers.

o

organization, and is one of the bank's

territorial

national

lending

ex¬

the

''

bank's
senior

of all these consid¬

result

bank's staff

1934; M/'Y

Aubrey G. Lanston & Co., Ine,„
15 Broad Street, New York City,
announced that Arthur J. ComhoY

Trust Advisory Board."

our

Caldwell

Mr.

1942;

Aubrey G. Lanston C

We are pleased that he will cqn-

Mr. Champion, who joined the

his

an

Chairman of

as

Bulkley joined,

Arthur Combe V.-P.

in the management group might

1929, has been in charge of the

tremely exoHbit/mt fpe.

would

fthe

changes, Mr. McCloy said, "As one of the

active part as directors.

an

tions

erations, the investment-banker is
highly selective, and it is no re¬
flection on his judgment that he
rejects proiects which are ulti¬

secure

was

dent

;

In announcing the

take

services, his charges would be so
large a percentage of the money

deserve

membership

in

Malick

Trust

Tinu'e to attend board meetings and to participate in its delibera¬

charge

for

,

aside in order that younger men

him hand¬
distant day—it may

worthless.

some

maximum

its

with

continue

management members on the board Mr. Ebbott has

very

ducing venture capital to venture
forth — and to venture forth at

i

directors.

V

risks as he can
multitude of risks

a

avoid.

adeouate

a

will

thus

■board

This stock may reward

involved

the place of
vice-chairman of the
after 43 years of service. The

the board and Mr. Champion will take

on

bank, " who retired last summer

is

—plus, perhaps, some equity as
partial payment for his services.

be

firm

to First Bea¬

came

Mr.

joined First Boston in

of the

Percy J. Ebbott, former president and later

risks, his immediate
compensatioh will be small

somely

Y/Y-;Y;;Y--, Y'lYV;

David Rockefeller will replace his brother, Laurence Rocke¬

feller,-

many

are

cannot

As

with little

;

v;

considerable
cash

the

kindle, tempered

risks

to

continue as

He will, however,

most

market

enthusiasm

experience.

the

for

"position.

Executive^ Committee. He and Mr. McCloy will continue as the

-a

has

he

and

fail.

difficult

is

ewe

•

that

-

succeed

might fill
Chairman of the

presidency of the bank in order that a younger man

'the

or

on

1929.

in

as,Cljairaian of the Executive Committee and President, has for
some- time wished to relinquish the
duties associated with the

have

thirsting for this item. Sometimes
it
is.
The - investment
banker,
however, has seen some companies
others

Syndicate Depart-'-

Caldwell of the

serving

Mr. McCloy said that J. Stewart Baker, who has been

Y

Mr.
tne

they

Invariably

the; best

mately

•

both of them to take office on Jan. 1,, 1957. Both
Champion and Mr. Rockefeller were appointed members of
"bank's bnc,rd of directors effective immediately.

To the promotor or the pro¬
prietor of these enterprises, suc¬
cess
is
inevitable
and
risks

unique

elected President, and David Rockefeller,
-Vice-President,
was
named Vice-Chairman of the

Executive

'

negligible.

J. Stewart Baker

uavid Rockefeller

George Champion

;bdard,

aggressi ve

an

tocCioy

J.

tive Vice-President, was

so,

chose

management

10

public

$300,000

or

tional

The

100%. to
perhaps 20%but his
person"! rW worth has increased
from $100,000 to a million dollars

an

experienced

sense.

com¬

stock ha« been r^duc^d from

mon
-

careful

a

sifting,

The i n vfe st m e n t
banker's business .is not a promo¬

placing its

company,

of major risk-r-a

investment.

in¬

one

*

.'ment,1 Charles'E. Halcomb of
/Trading Department; John S. Ma-

-Mr. Bentien

and

numerous

weighing of the factors affecting

Over the years we have
or three small
financing

done two

are

appraisal,

of the capi¬

owned

was

name

-

;pgrtment; Lewis R. Bulkley of th'-,*;'
Trading Department; William Ivy

ton

banker's<

First of. all, the very;
'investment" implies an ab¬

sence

Sales De~ ?

*

•

formidable.

came

;V-': 'y

-Y' >) :':Y

.

vice-presidents*; arc;'

new-;

partment; and Victor W. Mori, fro
the Sales Department.
; Y '

small

a

Y
financing

investment

the^ standpoint

company that

"The >'

search Department; Philip V. Mo-.'
of the Government Bond De ¬

to

as

-

founders.. I recall

;man..;!y

.■Fred G. Bentien of the

lick, head of the Investment Ro

v

be financed.

can

obstacles

from

Financing

no-pat

new

The

,

to

ment

han

is

company

well

can

grows

seven

according to an announce ¬
by George D. Woods', Chair-;

way;

-

.

First

The

1

his

&

to
Co.,

the
34

'

16

The Commercial and Financial Chronicle

(2512)

The

summer.

oils
were
given
stalling around.

highly cyclical

business has also been leveled

mostly

Motors

point

The inevitable

profit-taking

the stock market this

on

week, an eminently logical
development after a week
that
produced the sharpest
jump in the industrial aver¬ As has
age I in a dozen and a half months,

day

years.

sprees

and

steels

rather

the

been

for

case

occasional

the

one-

marketwise by the

still
largely one-day phenomena.

were

rather

rapidly and

'

for

definite

a

ruling

kets of their

One such,

own.

ferrous

crafts

able

were

investor
the

issues.

will

capture

mostly

on

that their busi¬

assurance

ness

to

interest

continue

at

high
levels despite soft spots else¬
where in the economy.
Year-end

Tax

J

Considerations

Pervade

before. This year its
profits were clipped hard by
year

the

strike

long

months.
shown

earlier

in

stock

the

But

little recovery,

has

hover¬

ing in the mid-50's and with
a
peak this year of only
around $65.
I

sje

❖

:•{

Resting

were

defi¬

nitely

laggard continued to
under the weight of liqui¬

Sag
dation that resumed when
became

incurred to win back its

kets

room

in

was

category that;

favor

some

waiting
definite to

:<!

*

Then

situations
where

All in

markets

all, it made for
moves

in

many

and for thin
of

some

the

less

active issues. The debates
over

tight

much

money were

since

fairly set

not

advocates

of

their

were

pretty

both

the

Anchor's

market.

least

-

low_

special
of

conversion
into

Anchor

understated

;

*.

has

7;

.

done

7 "*

little

years, in fact has Jjad
unusually placid market
since its split, half a dozen

life

but

to

Its range this year
only been about what it
in 1955 and 1954, only a

on

have taken

place

now

and the

common

is ap¬

was

little

better

than

expansion

didn't start to slow down.

the company
up

has been able to

its dividend rate modestly

both

last

year

and

late this

10-point
swing. And lately it has been
closer

the

to

low

trade

experts

nitely mark it down

from

bring

this

the

their

source

into

popularity.

Despite

some

definite

eas¬

still

given to uncertain

the

Rhoades &

First

ASSOCIATION

OF

NEW

was

continuing

debate

over

domestic

succeeds

..,

of

New

York, Inc. for

Edward J. Kelly, of Carl M.

Loeb,

Co.

McLaughlin, of McLaughlin, Cryan & Co.,

Vice-President

Nathan A.

of

the

security

traders

named

was

Bernard

group;

J.

the

Carl

speedily

the

enough

so

that

oils

international

like

back and be the better

performers.
made

lately

hand,

overall

nor,

on

the

they

un¬

J.

The

to

stimulus

the

Daniel

and

serve

as

S.

directors

Cruttenden

of

of

the

association

domestic
shut¬

down of Middle East oil oper¬

ations seemed to have

&

run

and

of

&

two-year

Stanley E.

Jacobs,

Sidney

Co.;

for

of Sidney

Edwin

Saltzman,

appointed

were

the

of

trustees

Gratuity

Fund

for

two-year term.

BOND

TRADERS

Edward

A.

Traders

Bond

CLUB

OF

CHICAGO

Bros. & Hutzler, President of the

Roob, Salomon

Club

of

Chicago,

announces

that the club's annual

winter party will be held Monday, Jan. 23, at the
Cocktails

6 p.m.

at

Dinner at 7

reservations

Hotel

Wm. H. Tegtmeyer
A.

Co.,

is

be

'

with

made

Charles

G.

Scheuer,

J. A. Marquardt, Wm. A. Fuller

Incorporated.

charge

in

Sheraton Hotel,

p.m.

& Co; general reservations with John D. Kipp,,

G. Becker & Co.

&

may

of

options

optimistic

and

Milton

J.

Isaacs,

Straus, Blosser & McDowell, prizes.
TRANSFER

STANY
In

been raised

meeting

well

as

Dec.

of

view

the

FORUM

TAX

many

questions of interpretation which

concerning the New York State transfer tax,
forum has been

and

New

of

York

for

13, 4:30

by

arranged
an

open

similar Federal tax problems.

the Security

airing of this

have

special

a

Traders

subject,

as

This will be held Thursday,

at The Bankers Club, 120 Broadway (38th Floor).

p.m.

M.

Kassell,

Deputy

Commissioner

and

Counsel

of

Diamond, former

special assistant to Chief Counsel, U. S. Bureau of Internal Revenue
and

presently of the faculty of the Practicing Law Institute, have

consented

to

address

this

forum

and

answer

questions from

the

-

its

Cashiers, partners, and
course

Conlon

J.

J. Mullin,

Corp.;

of Lee Higginson

Barker,

the New York State Tax Commission, and Leo A.

a

Bernard

Daniel G. Mullin

Secretary,

Co., and Elbridge H. Smith, of Stryker & Brown.

Mortimer
*

Inc.,

Markham, of Wertneim & Co., and James V. Torpie, of Torpie

rough.
❖

Co.,

John

were

Associtaion

were

John J. McLaughlin

&

Dawson-Smith,

Neither

much

Marks

Jacobs &

dle East situation would clear
up

Krumholz

Tucker, Anthony & R. L. Day Co., Treasurer. 7

a

or

Y. 7

7:7

Conlin, of P. F. Fox & Co., Second Vice-President; Barney
Nieman,

ship

whether

due to

usually heavy when the going

Chronicle, 25 Park PI. N.

the,

YORK

floor.

c/o

of

presented

of the author only,]

Security Traders Association

John J.

a

action. Part of it

oils had derived from




those

those
are

Krumholz, of Siegel & Co., has been elected Presi¬

Mr. Krumholz

Elected

ing of tensions, in the Suez
situation, the issues involved

was

Edwin L. Beck

of

terms

Uncertainty Over Suez

#

Phone REctor 2-9570

as

with

They

could

stocks

store

seasonal

other

Available in New York
City—Write

coincide

"Chronicle "

any

Notes

TRADERS

Nathan A.

of

progress

"CHRONICLES" from 1938-1950

were

this

necessarily at

dis¬

being watched carefully,
and the first good

group

Beautifully Bound Set of

time

issues

in

expressed

not

The vari¬

season.

however,

market

"FOR SALE"

views
do

retail trade measurements

snap

Incomplete?

[The

article

defi¬

to

as a

Royal Dutch and Gulf would
Are Your Records

tool

SECURITY

a

building issues would get the
proaching an end for Air Re¬ most
largesse from the tanker
that duction. Despite the
weight
shortage, or whether the Mid¬

another

*

NSTA

1957.

were

dilution of the

A-

year

"

dent

stand

also

up

credit

the

reins

❖

for

„

anything but. pace-setters al¬

has

*

The bulk of the conversions

f

,

#

Machine

years ago.

statisti¬

the stock.

on

to predic¬

up

"

only in good business
for Cincinnati but
several years ahead.
' 7, :

next

in

pre¬

cally and the conversions,
themselves, helped to weigh

lives

-

...I

•

out not

recent
an

news

shares

common

.

r 7- 777: 7

7'
*

were

Air Reduction

grams and this, together with
the projected increasing pace
of business activity, is spelled

rougher

more
rebound if the new

a

,

V'v'7

7

statistically, behind the

market.

ous

kept improved operating

results

seemed

only that

going

ground,

if

it

tight

they would pull
notch

like

action.

had

times-earnings basis, less than
nine-times-earnings in fact,
and its comfortable yield of
around
5172 % * makes
it, at

retail

j|t

were

ignored by the market,

particularly

credit

:is

*

ferred

divergent

.

there

predict without

Big Three leaving
for

Anchor: tions.

Hocking Glass, which have
largely sat out the enthusiasm
that affected other groups in.

mar¬

shut¬

strike

market

has

model year

times

at

like

issues,

were

appointing

it

they
weren't going to benefit from
the strength elsewhere.

the

down.

apparent

*

after

1

o n a

of the

far

indications that

were

nati

also

were

Chrysler

figure
Admittedly
Westinghouse than it has been
not all of the tax
poised for
selling had will offer a
dreary report for
been cleaned up yet. In fact
any assault on new peaks.
this year but the tide seems
the evidence would tend to
to have turned and earnings
show that some of it was de¬
There was little interest in
could
back markedly
snap
ferred
with
the
the
stores
issues
market's
since
the
next year. One of the heavy
Christmas buying has been, if
strong rally last week to see
charges against this year's
how much of the losses could
anything, a little tardy al¬
be minimized in the rebound. earnings is that for the spe¬
cial promotion the company though it is still too early for
And the issues that
There

i

c a s

two

.was

Still another

Westinghouse Electric,
air¬ reached $80 last year and the

The

forecasts

good business
throughout the year. Cincin¬

market action than the other

helped keep interest alive in
the

it

what

over

Sleepers Attract Interest

were

prominent on their
Westinghouse—A Bargain?
ability to shrug off the realiz¬
There
was, some
bargain
ing and snap back where
slight inroads were made at searching through the list and
times. The fact that the
long- such buying apparently was
pending union of Bethlehem "good" buying, i.e. for the
Steel and
Youngstown Sheet long pull rather than a fast
was
being pushed by the com¬ turn. This was concentrated
panies to force the anti-trust mostly on issues that have
division to
get it into the had long, private bear mar¬
courts

year

years ago.

down

simmered

carriers

Aircrafts and Steels Resilient
Aircrafts

1957

most

to

Milling Machine officials
any hesitation
something more
that
its own to utilize the gas for
operations at capacity
come
along. So far the accept¬ are due throughout 1957 by
chemical manufacture. By up¬
Rails were downright stub¬
ance
of the new models has
this, the largest maker of
grading its principal product,
born in their refusal to get
Air Reduction has succeeded seemed to be fairly good and machine tools. So far the
going despite recurrent talks in
lifting profit margins Chrysler, whose new cars tight money policies have
of
their
freight rate rise
seemed to be clicking, was the failed to
put any great damp¬
sharply, with the prospect of
authorization being imminent.
issue showing the better oc- er on business
expansion pro-:
margin
next
doubling the
Motors

on

set in

Thursday, December 13, 1956

.

though

to

out

by stepping up the use of
acetylene to make synthetic
products including a plant of

.

.

except where spe¬

cial conditions warranted, the

most

allied

important
tax

New

York

any

other individuals interested in this

State

Stamp

Tax

matter,

and

other

problems affecting transfers of securities, are invited.

k

Volume

Number 5594

184

,

.

The Commercial and Financial Chronicle

.

(2513)

providing

Reforming Professional Services
By ROGER W. BABSON

wills.

forms

for

Certain simple services which

simple

very

She has recently been noti¬

can

fied by the attorney

of the N. H.
Lawyers Association that she will

get

now

lawyers,

we

only from doctors,

optometrists,

a

procedure."

estate

reading

new

called

;

up

optometrist.

an

I

was

told

that

could

not

I

get

appoint¬

an

for

ment

month.

a

After

waiting
month

a

In

ton,

the little town

N.

lawyer,
woman

H.,

but
has

there
a

of New

is

very

been

Bos¬

local

people in various ways, including

and

found

that

to

to

make
of

one

one

nurses

or

charge
other

making

able
an

to

secure

advance

dollar. When the

assistant

ap¬

locates

nurse

or

her

dangerous

any

PITTSBURGH,

of

National Bank

Building, members
Exchange

other exchanges, as manager
of the municipal bond department.
Mr.

Tresch

will be

B.

visit

dentist,

was

formerly

doctor,

a

Van

Ingen

&
■

Co.,

cial

or

at

other professional offi¬

■

once

will

and

make

an

The

appointment therefor. In the end,

firm

City, has

will benefit from such

persons.

ball

a

procedure.

name

of

an

a

There¬

he gave

upon
me

Roger W. Babson

t i

preserip-

a

o n

for the

to go

glasses, which
to the next village

and

hunt again

for another park¬

ing

space.

we

should

caused

me

Certainly the time is
coming when one call will com¬
plete such a transaction. Further¬
more, there is no more reason why
have

make

to

an

ap¬

pointment in advance to have
tested than to get

eyes

Advance

our

shampoo.

a

Appointments

Unnecessary

During the
ble

with

I had trou¬

summer

of

one

my

I again

ears.

required to wait a week for
ah appointment. Although the ear

was

doetor

felt

the

that

trouble

was

perhaps due to iow blood pressure,
he would not take my blood pres¬
sure but sent me instead to a local

doctor.

Again

week for

had

I

blood pressure taken.

my

wait

to

a

appointment to have

an

I finally

advised to buy a hearing aid
of some kind.

was

I

able

am

Without

have

to

get

a

manicure

appointment,

an

but

to

I

get

an

cut

corn

a

must

advance appointment, and perhaps
wait several days! The. whole per¬

formance
Doctors
in the

now

able

be

setting

me.

offices

up

building, but this will

same

solve my

not

irrational to

seems

are

I want to
simple

problem.
all

find

to

these

personal services in one building,
and some day I will be able to do
it.

And, furthermore, without ad¬

vance

appointment!

Experience With Dentists
For many years I

have believed
one's
every month,
but

A

in the importance of having
cleaned

teeth

new source

COPPER

Of

this could not be done without an
advance

appointment. When talk¬

from "the richest hill

my associate workers of the
importance of preventing decay

ing to

by monthly cleaning, I found they
were
troubled by the same ad-

difficulties.
Thereupon, I decided to have a
dental nurse in mjs^own building
to
do this work, unattached
to
any dentist. To my great surprise
I found this was against the law
and I was obliged to go to the
Massachusets Legislature to get a
special act to permit it. Yet we
appointment

van c e

allowed to teach our servants

are

members

or

oculate

us

of

our

with insulin.

Recently I bought
through
Within
calls

that

a

other

agents

town

the

or

a

brighter and longer than its long, productive past.
Meanwhile, Anaconda continues to apply its more
years' experience, not only to the develop¬

of at least 100 million tons.

Today Berkeley Pit is yielding ever-increasing

for many years to come.

gram

Experimental work at Berkeley Pit,"begun in 1954,
ore reserve

so

Berkeley Pit is just one phase of Anaconda's prowhich assures for Butte a mining future even

open

assures an

annually to the world's supply and will

continue to do

pit mining operation is recovering prof¬
itable low-grade copper ore.
new

than 60

ment of

but to meeting the
more and better
products in the entire non-ferrous metal field.

ore

tonnages. When fully developed in mid-1957, this

new

copper sources,

expanding needs of industry for

56270B

house

size

of

all

where

to be that

house,

Anaconda Aluminum
International

The

It would seem that

sale could be listed.

list the

activity at Berkeley Pit, where

stating

they could get the property

seems

copper

reason

home

Wellesley

there could be some central clear¬

ing

looked better. One

local real estate agent.
few days I had telephone

from

a

is Anaconda's

never

project alone will be adding 65 million pounds of
new

a

copper's future has

earth"

a

for less money.
in

family to in¬

At Butte, Montana—"the richest hill on earth"—

on

houses

for

The difficulty

people dare not

or even

consult two

three agencies, for fear of get¬




Chile

AnacondA

Company
Smelting & Refining Company

Andes Copper

Mining Company

Copper Company

The American Brass

Company

Company

Anaconda Wire & Cable

Company

PRODUCERS OF: Copper, tine, lead,

aluminum,

silver, gold, platinum, palladium, cadmium, selenium,
tellurium, uranium oxide, noduHzed manganese

I

Copper Company

Greene Cananea

ore

and standard ferromanganese, treble-

super phosphate, arsenic,

bismuth, indium.

MANUFACTURERS OF:

Copper and

aluminum electrical wires and cables: copper,

brass, bronze and other copper alloys in such form*
as

sheet, plate, tube, pipe, rod, wire, forgings,

stampings, extrusions, flexible metal
hose and tubing.

&

been changed to Kim¬

Securities, Inc.

half hour with

him.

Kimball

Co., 40 Exchange Place, New York

the public and all the professions

competent

I-

Now Kimball Sees.

even¬

I had

Inc., in
; ■-!.

lawyer,

finding
parking

space,

with

Chicago.

to

J.

tually
a

Arthur

and

appointment,
and then

—

of the New York Stock

these

trained

Pa.

Tresch has become associated with
E. Masten & Company, First

A.

symptom, the "customer"

for

central ground-floor "store"

the

under

be

:

A. Ei Masted & Go>

chiropodists,

pointment, and at fees of less than

all

urged

result

then

without

use.
a

technicians,

will

we

my

the Trust

a

for

he

experi¬
ences, I forecast that simple pro¬
fessional and other special serv¬
ices will some day be obtainable

bank or
intelligent at

no

helping

and

brokers,

later

I

lawyer

you

Graft

Legal

her

bank, which advertises
Trust Funds, must send you to

As

The

for

local

own

for

who

and

glasses

plead

agents,

others.

"

returning from Florida ting into a conflict as to
spring, I felt I would like should have the commission.

some

to

this at¬

see

said that the law applies not only
to her but also to
banks, real

After

this

manicurists, and real estate agents

torney

simple services can be secured without making an adyanced
appointment, and at fees less than one dollar, by recognized
financial analyst. In the end, Mr. Babson opines, "all the
professionals will benefit from such

dental

I

personally went to

Arthur Tresch Joins

opticians,

be prosecuted if she continues this.

Doctors, lawyers, optometrists, dental technicians, real estate
agents are asked to reform procedures used so that their

17

18

The Commercial and Financial Chronicle

(2514)

to decline

The Defense of Sterling

as

the

in¬

foreign

ex¬

of

use

clude that

safe to

of reservists called

also

sterling,
the

in

general

phere.
and

howevtr,
As

is

the

economic

result

a

economic

of

atmos¬

uncertainties,

the

November,

an¬
ment

fer

the

the

no u n e e

the

loan

that

% /

lion

these

mil¬

$279

was

lost

unt

mo

a

wm

as

shock. It

con¬

has

f

o

Paul

Einzig

1-

respite.
reason

Macin

of

trie

Labor

uncritical

Party

in

his

endorsement

the Government's

from

the statement

brief

debate

that the
mined
at its

that

followed

Government is

as

present parity.

question of

to

Such

measures

few months'

a

there

the

on

favor

of

is

no

scale

same

sterling.

that

are

And

before

very
re¬

normal proportions.

more

any

ate

case,

as

result

a

of

the

of

British

Governments

Egypt, there

be

no

better

a

mal

dollar oil

to

the
and

with

now

chance

dollar facilities

the

the

evacu¬

appears

for

to

obtaining

finance

abnor¬

imports.

woujd
bring temporary relief,
lowest
level
sterling
would command more
confidence,
and foreign sterling balances^
would be replenished, short posi¬
tions would be covered, and many
doubtless

Midale East and in Europe is like¬

for

ly

at

its

deferred sterling payments would
be effected.
In spite of this, Mr.

stroke

is

of

going

to

the

try

to

solve

it

The

alternative

to

The

attained

diminished
serves.

lor

intends

to

was

in November.
as a

everything

market,

half-hearted

markets.

even

we

were

at

kets

have

will

be

become

Even
of

a

fears is

war

to

affect sterling to
in the near future

affected

it

in

Moreover,

fears
political crisis as

sought to

a

it

recent

of
a

less extent

than

the

likely

a

had

past.

domestic

result of

a

dis¬

restoration

may

the

use

Treasury's resulted in the advent of
of

dollar credit, and he also

intends to draw

consumer

outlook

dustry

am

now

a

Social¬
matter

will

Military expenditure is expected

L

THE

HEARTLAND

If

OF THIS GREAT STATE

)-■

|OWA

LIGHTS

in

tne

long
has

budget

should

go

a

towards

preventing: a
buying fever that
going on continuously
years.

Wage

v

The

Demands

situation

bility of

Restrained

carries

the

as

they develop.




this

1956.
8?.

•

Homer

of

ing, and this itself is sufficient to

discourage

consumption

by

ployees, which represents
of domestic

What

the

is

even

large

a

consump¬

impor¬

more

possibility of un¬
is sufficient to

mere

employment
discourage excessive
mands.

em¬

Amidst

tions,

the

likely

to

much.

Most of

de¬

wages

prevailing condi¬

trade

unions

announced

was

the

by

them

lie

6.

Mr.

of

the

Lynch

University

of

at¬

Dela¬

rise.

Had

it

Smith.

joined Manufacturers
Trust' Company in January 1956
and at present is assigned to the
cated

tney

would

for maximum

been

pre¬

been

for

if

held

face

had

employers

to-concede their claims/'

event,

any

out

a

Mr.

major

refused
^

Macmillan

New
the

York

Vice-Presidents,
Cashier

and

The

agers.

imports

Together
of

of

means

consumer

with

export

■.."/

the

im¬

prospects,

Dec.

on

12

rinfant

Frey,

11

*

Man¬
us

diu

Cashier

VifetPre^ent:

to

As-

Albert

F.

Cashier's

Department; DeTornor, Bond Adminis¬
Lewis
C.
M u r d o c k,

A.

Domestic Division; William Slack,
Fifth Avenue Office; William F.

Bond Administration.

.Sweeney,
■

John

W.

Benton, of the Over¬
Division,
was
aopointed

seas

Assistant

F'.ath,
Charles

J.

*

Willard

Street

Stamm,

and

Bronx
'...

.*■

.

*

*

A.

Office,

Office,
Assistant 'Man¬

appointed

were

agers.
.

Cashier.

28th

^

J.

Shanahan,

Federation

clared
dend
an

New

of

30
5

the

have

quarterly
for

cents

the

1956,r making
for

divi¬

share,

per

the

plus

fourth

total

a

Tn

year.

The

voted.

cash

Dec.

on

dividend

26,

to

is

stock¬

of

will

the stock dividend at their annual

1957.

■

Taking everything into consider¬
ation

that

it

Mr.

seems

safe

Macmillan

to

conclude

will

ba

able

to defend

sterling against any fur¬
pressure
in "tne new -year.

ther

Apart

Company exceed

we

may

we

one

billion

commercial

working and
be able to meet ALL
are

altogether

from

the

rein¬

record

be

meeting

on

dividend

will

to

pany, "with
maintains

the

capital

approve

stock

the

bank's

shares

from

shares.

and Trust

headquarters

at *10

Stock¬

This

increase

Bank

18.
to

8.

356,700

Federation

Coliseum

Dec.

asked

Jan.

outstanding
348,000

forcement of the gold reserve with

likely

of

dollar

tojre'coVe

through

the

credits,

it; is

r appreciably

replenishment

Com¬

ment

of the balance

two

of payments.

India,

#

New

Department
plans

-

to

in

its

sphere

The announcement,
Dec. 6 also notes

that. the
under

bank's

British

branch

system,
di¬

management,

t

rected from London serves:

Aden,
India, Pakistan, Ceylon; Burma,
Singapore and Federation of Ma¬
laya, North Borneo and Sarawak,

Indonesia,. Cambodia,
Vietnam,
Thailand, The Philippine Repub¬
lic, Hongkong, Japan and Ham¬
burg, Germany. J. Scott is agent
the

bank

in

New

*

*

York.

/

*

-

.

In line with the permissive rul¬
ing issued recently by the Fed¬
.

eral

Reserve

Brook

Board,

National

Hempstead
Nassau

3%

pay

rate

in

the

its

on

This- is
one

West

offices

I., N» Y„

interest

one-half of

of

26

~

County, L.

accounts.

the Meadow

Bank

with

in

will

savihgs

increase'

an

of

percent from the

currently being paid and will

become

effective

making

the

Jan.

1

next/ In

announcement, ^Au¬

gustus B.

Weller, President of the
Meadow Brook Bank, said, "Three
percent

per

is

annum

banks

to

pay

deposits.
this rate

on

We

responsibility

pay

>their

sav¬

believe

of

the

long

so

the

now

for commer¬

it

is

banks' to

as

it is

eco¬

nomically possible for them to do
It is our hope that in offer¬
ing this additional incentive: to

so.

the

public

will

become

to

save,

funds

more

available for

the

fi¬

nancing of the continuing growth
the

of

area
which
is
currently
being partially blocked by the
'tight money' situation."
*

*

The

Trust Company

has

*

Manufacturers and Traders

been

Banking

of Buffalo, N. Y.,

authorized

by the State

Department

increase

to

its

capital, and at the same time
(Nov. 23), has received authoriza¬

tion

from

cf

pany

N.

the

the

merge

Y\,

Department

Genesee

Batavia,

into

the

the

ment

latter.

of

Trust

Green

,

Manufacturers

As

under

to

the capital

the

to

Com¬

County,
the

&

title

enlarge¬

of the Manu¬

facturers Trust, approval has been

given to
of

certificate of increase
stock from $8,712,000,
1,742,400 shares, of
value of $5 each, to $8,a

capital

consisting
the

par

999,500,

of

.consisting

shares,

the

of

Earlier in the

and

Traders

authority
department

Banking

1,799,900
value.

par

month, Nov. 19, the

Manu acturers
received

of

same

branch office in

a

Trust

from *
to

the

open

a

proposed shop¬

ping center to be known as Grand
Island
Plaza, located at Grand
Island

Boulevard

and

Base-Line

Road, Grand Island, Erie County,
N.

Y., on Nov. 20.
*

*

The

of

board

Liberty

Bank

%

•

of

directors

of Bulfalo,

at

the

Buf¬

Columbus

Circle,

falo, N. Y., announced the election

offices

on

New York
City, and one in
Flushing, Long Island, New York.

The

change

any

additional

s&:

#

York

State

approved
increase

Nov.

29

on

the

Banking
Dec.

3

capital

of

E.

Perry Spink

as

President.
sjs

Approval

of

sterling holdings and the improve¬

of

available

The

in

-aid

made

de¬

stock dividend of 2V2%

a

payable

an¬

that

the' bank

cash

$1.25

Trust

12

cents

of

addition
was

York

Dec.

regular

a

of

quarter

and

of

extra

President

Bank

holders

balance

I

Bank

and

of operations.

of

Thomas
of

holders

the

*

Traders Trust Co.

❖

of

of

signify

ihgs

'

v

Assistant

From

A

Assistant

„

cf

in

*•

appointments

follows:

directors

fall

'

,

one

two

011

demand

"

announced

Company,

consumer

value.

par

\

Chartered

Australia

cial

appointment of five Assistant

nounced

replaced by repeat orders. Tire

The

same

%

doJegal maximum rate
office,

main

s

The First National City Bank of

further reinforce¬

vol¬

;/.*

a

Witt

demands, and wouid
tq

department,

bank

Broad Street.

55

tration;

have

willing

trust
the

at

too

not

partner of th'e

a

He

not

be

the cifiiculties caused by the Suez

crisis,

formerly

was

law firm of Van Vcrst, Siegel an'd

are

will

the

W.

Horace

Chairman

Dec.

on

claims

their

press

share,
consisting of 85,815

shares of

Trust Officer of Man¬

of

used by industrial and

that

of

totaling
declared

payments during the earlv months

Serving 58 Iowa counties*
so

business

been

#

Flanigan,

tended

employment and short-time work¬

improvement

The kilowatt hour sales of
this

ahead,

of

un¬

this should accentuate the seasonal

able

years

have

year

a

personal
>

possi¬

certain amount of

a

provement

has the remark¬

power needs

of

the

many

decline in

characteristic of
being
equally balanced between
agriculture and industry/

planning

York,

Board,

influence

on

ufacturers Trust Company of New

C.

untary repayments as and when
the inventories are liquidated ami

Balanced Economy

s

as

to

for

of

result

appointment

The motor in¬
remain

116
Fifth Avenue,, from
$2,103,300, consisting of 84,132 shares

of the par value of $25
per
to $2,145,375,

of

Lynch

revival of the

close

dividends

*

The

a

payable

years;

next

of

been

for

•not

Agriculture and Industry

o'n

stockholders

The

that

during the

of

revival

some

under the

way

goods.

which, 41 %

1956.

the volume of credit through

Rapids,

share

the increase ware and received his Bachelor
petrol. - Mr." of Laws degree from the Univer¬
Macmillan's
warning about the sity of Virginia. He practiced law
possibility of higher income tax in New York City for 25

a

of

per

both
to

the

at

14,

ity, in the changed situation there

Iowa

customers.

Dec.

next,

is every likelihood of a decline in

POWER

\Company
Cedar

—

traffic

ment of the credit squeeze, sncuid
this prove to be necessary. In real¬

ELECTRIC

quarterly
a

petrol rationing and
of
import duty on

In

area

normal

expected

time

have

"V

record

the economic
remain
sufficiently

foreshadowed

This

of

demand,

is

strikes

the dollar fa¬

on

the past..

a

share,

a

15,

through the Suez Canal

encourage

some

cents

Jan.

share

pared to| accept a relatively mod¬

policy, which might have

a

cents

capital stock of the company
the quarter ending
Dec. 31,
1956, and an extra dividend of 80

54

erate

Eastern

80

situation and

conditions

State "Bank

Company cf New York,

at

adopted

was

declared
of

is

agreement within the Conservative

end, the Chancel¬

far

Commercial

China which was
of the proposal would in-,
incorporated in England by Royal
the company's canital stock
Charter in 1853, will henceforth
from the present 5,000,000 shares
be known as The Chartered Bank.
of $20 par value each to
6,000,000 It is
announced that simplifica¬
shares
of
the 4 same
par
value. tion
of-the bank's title does hot
Guaranty directors at the same

action

Party

the Government's Middle

share

one

proval

improvement

re¬

on

of

the

and Trust

crease

the

the

ist Government

—a

of goods

and

dollar

rate

international

the

the

though

tant,

As

from

of the company's
board of directors on Dec. 5.
Ap¬

meeting

difficult, there

large quantities

result, the psycho¬

relations.

Trust

York

of

meeting

a

dividend

released for export, and producers
will do their best to export them.

tion.

improve

Guaranty

New

to
the

the

acute

as

It is

at

their

the

in

for

proportion

raising

IRVING

Hence

of

the

at

were

about

increase

of

each five shares held

long

Even

natural reaction

to

do¬

the

in

firms

most

dend

delivery dates and uncompetitive
prices. Now that domestic mar¬

their

camps

dollar securities for the
purpose of
a

into

reinforcing

by
gold

To that

time.

to

op¬

devaluation

is

unload

posing

confidence by means

first aim

to

time on the verge of the third
world war, there may be a genu¬
ine effort on the part of the

strengthening both the technical
position and the fundamental po¬
be

it

logical factor of

is to restore

their. ;export

effort

So long as it was very easy,

likely to

one

cf

sition.

time

is

to the realization that

the

hard way.

it

or

it is not likely to be

so,
as

from

possible that,

Instead, he

pen.

continue,

revive

Macmillan will resist the tempta¬
tion of solving his problem with
a

to

again

more

return

Unfortunately, the tension in the

step

a

above

United Nations demand to

line of least resistance by devalu¬

ing sterling.

in

French

sterling

take

during

on

which

drive.

expect the continuation

compliance

is

There is

seeking

inventories,

for traffic, so that dollar obscure to prevent
requirements will become re¬ inflationary boom.

In

the

it

the

chances

oil

deter¬

as

defend

to

ever

to lead to the accumula¬

of

will induce industrial firms to put

opened

of

from

going

was

rate

same

long the Suez Canal will be

forcefully

and

tion

export

sterling

pressure on

drain

duced to

fense of sterling.
A fact that emerged

Continue

to

Fortunately

the

the

in de¬

measures

if

it

to

turned

almost

was

de¬

after the turn of the year.- By that
time the seasonal factor will have

For

o n s.

Party
politics
were
cast
aside, and the official spokesman
the

means

be

can

to continue at the

November,

figure

Mr.

Not

would only secure

once,
of

long

a

is bound

mestic

which

at

House of Comm

sterling

Of course,
were

the

on

the

go

on

them

rather

the

silence,

millan

which

Drain

announcement

by

interest

Between

should

measures

with

temporary

of

1946.

even

shocked

lowing

of

fended.

a

Opposition in¬
to

of

payment

towards increasing tne

way

came nev¬

ertheless

de¬

Company

recommending

an

stock

5100,000,000 to
$120,000,000
through payment of a stock divi¬

con¬

declined

demand

resolution

capital

political

England — Although cilities at Britain's disposal at the siderably. In spite of the approach
prepared for a International Monetary Fund. He of the Christmas season, retail
sharp fall in the British gold re¬ also applied to the Washington business is unusually slack. This
Administration for consent to

A

stockholders

change

was

during

Bankers

and

CAPITALIZATIONS

more important from
the
point of view of the prospects of

LONDON,

serve

BRANCHES

OFFICERS. ETC.

REVISED

Exports to Increase

sumer

everybody

NEW

NEW

Much

1946 U. S. A loan.

on

will

CONSOLIDATIONS

up

help towards
reducing military spending.

new year.

deferring interest payment

with

in connec¬
the Egyptian interven¬

tion

Dr. Einzig notes: politics has
been cast aside in defense of sterling's present parity; fears
of political crisis—resulting in a Socialist Government—is now
a matter of the past;
seasonal uplift in exports should be ac¬
centuated in view of Suez crisis causing consumer demand
decline, inventory accumulation, and restrained wage demands;
and effective Governmental measures undertaken including
in the

News About Banks

The release

tion

con¬

sterling will be successfully defended against any

further pressure

par¬

overseas

change will be lower.

Well known British economist explains why it is

In

troops.

expenditure

volving

By PAUL EINZIG

Thursday, December 13, 1955

.

result of the with¬

a

drawal of British
ticular

.

.

the

on

Northern

Company
increase

of
its

*

Dec. 5 of plans of
New

York

Trust

Watertown, N. Y: to

capital

stock, from

Volume

5594

Number

184

:

.

The Commercial and Financial Chronicle

.

$*962,500,
consisting
of
38,500
shares, par value $25 per share,
to $52,000,000, in 80,000
snares of
the same par value, was granted
by the New York State Banking
Department.
:•>

Patsch,

McVitty

the

Executive

of

appointment

Coie

Mr.

and

tor,

had

stated

of; the

directors

Citizens Xfust Company

of Sum-

rJ., at their .meeting on
DCec.
4
declared
a
.semi-annual

of. 50".cents

dividend

share

.per

the

capital

planned,

.

.

of

The stock melon means
capital for the insti¬

.

increased

an

and

permits

higher limit
Riggs now has

loans.

single

on

have

the

Mr.

directors

be acted
on

a
t

of

we

lion

and

a

(10%
the

the

high

as

capital

Mr. Fleming stated

new

shares

represented

by the stock dividend will. be ison the basis of 3?29ths of a

-suecj

■share

pro¬

From the

$100

in

held

after

value from

par

;-v%W

$25.

to

share

each

reduction

the

by the

for

,

.

letter to shareholders, will be

They

will

the

and

35. "cents

per

14.

holders of record Dec.
.V-.

,,

'

The

board

Provident

*•"

"*•

>■:

M

of

have

made

•

;/:V;

on

the

>

* '■

-

Bank

V

of

*

i
.

of

.

The

Richmond,

at

oh Dec. 7 elected Herbert C.

Va.,

lVIoseley Executive Vice-President
and
a
director
of
the i bank;

of

seven

promotions among officials
bank, William R. K. Mit¬
chell, Chairman and Benjamin F.
Sawin, President of the bank, an¬

$7,250,000

divided

the

who

trustees

present

will

72,500

$8

million

certifi¬

issue

cates of participation.

into

These

cer¬

shares
divided

of

$100

pai4 to

tificates will be in units of l/29th

into 320,000 shares of $25

of

a

share

and

may

be

bought

formerly

urer

and

Capital

and

cer.

Henry

Walz

C.

Trust Offi¬

a

and Thomas

Farr

V.

Zug, formerly Assistant Trust
Officers, have been promoted to
positions as Trust Officers. Paul
been

has

Toolan

Francis

this

and

vided

cer,

Investment

Trust

sistant

and Everett L.. Miller an

; Mr.

bank's
over

surplus

ac¬

count

ter

Senior

;a'nd declared a fourth qucirdividend of 25 cents a share.
John B. Org'ain, Jr. and Frederick

Jr.

in

ing
sion,

the
the

of

Petersburg.

regular
bank's

Meet¬

in

office
time

in

and

to

of

currently

A

serving

He

-

Mr. Zug, formerly As¬
joined Prov-'
fdent in 1933.
He selved in the
trust accounting, audit, tax and
statistical
departments
and
is
currently
associated
with
the
trust
administration department.
Mr. Tooiun
joined Provident in,
partment.

at

the

rate

of

sistant Trust Officer,

.

year

matters.

legal
in

been

a

specializing
Mr. Boylan has
trust investment de¬
been

has

and

1953
in

the

since joining the com¬
in August, 1954. Mr. Miller
associated with Provident
1940 and is currently in charge
the tabulating section.

partment
pany

declared for the semiannual

became
in
of

Pennsylvania Na¬
tional
Bank of McKeesport, Pa.,
announced that on Dec. 7 it re¬
Western

The

approval to
purchase the First National Bank
ef Houston, Pa.
The 55-year-old
bank, it is said, will be the 14th
acquired' by WPNB in the four
years that M. A. Cancelliere has
been
its President and the fifth
added in the last 12 months.
It
will
increase
WPNB's total re¬
sources, it is stated, to almost $157
million.
Preliminary approval of
the purchase was granted by the
U.
S.
Comptroller of the Cur¬
rency.
The purchase now is sub¬
Houston

The

total resources of

deposits

of

the

tional
the

as-

visory

DAY
Money deposited
will

earn

on or

before

dividends from

JANUARY 15

OF

JANUARY 1

DEPOSIT

$2.9 million and

It will

million.

the

Houston

members' of

who will

be¬

WPNB's

Ad¬

Board, are J.

C. King,

R.

Plunkett; Harry M- Templeton,

Ralph * W.'." Peacock,.-

J.

•




BANK

BY MAIL

—

Send for free

postage-prepaid envelopes

THE SEAMEN'S BANK
for SAVINGS
CHARTERED

30 Wall

1829

Street; New York 5, N. Y.

546 Fifth Avenue at 45th

Street, New York 36, N. Y.

office

Present directors of

bank,

★

★

has

bank

Western Pennsylvania Na¬
Bank.

Houston

come

E.

$2.6

of

known

of stock¬

approval

the

to

holders.

be

Dividends Paid From

preliminary

ceived

ject

period

ending December 31, 1956

Clerm

Member Federal Deposit Insurance Corporation

an

years

and

officer

Vice-President
the

was

bank

in

elected

Continned

DIVIDEND

de¬

first

the

for

of

arid

Peters¬
a

Vice-

ses¬
au¬

of

Officer

administration

trust

the

in

is

He

ments.

it

Assistant

Cashier

Assistant

publicity. Mr..Farr, formerly As¬
sistant Trust Officer, joined the
company
in 1929 and served in
the auait and trust tax depart¬

bank

number

with 28
Join¬
ing The Bank of Virginia on Jan.
1, 1945, Mr. Moseley's first as¬
signment with the bank was that
brings

prospect
advertising
and

.<

the
a

business,

trust

new

research

from

Execu¬

years' banking experience.

burg.

monthly
directors

to

tive Vice-President fills the latter

Smith, of "Richmond and John J.
Whitt,

an

Vice-President

departments,
is cur¬
active in the solicitation

rently

,$3,-

000.000, Mr. Boushall said.
Mr. 'Moseley's promotion

planning I
of

additonal

bank's

the

real estate and estate

the title,

in

total

bank's

The

reserves

Walz, who has served

Mr.

capital

in¬

in charge of
bank's Media

currently
at the

is

office.

will bring
funds to

account,

total

$8,000,000.

officers;

Flood, with Provident since

operations

$800,000

profits

the

just

Treasurer of the company.

1933,

together with the
in the undi¬

total,

than

more

In You

ap¬

an

now

$7,200,000, according
to Thomas C. Boushall, President,

Make More'HEADWAY

Assistant Trust Offi¬
John Richard Boylan an As¬

pointed

surplus

will

to

Assistant Treas¬

an

Mr.

Thi»

to $3,-

other

promoted ;six

ac¬

surplus account.

600,000, which is an amount equal
to the capital stock of $3,600,000.

promoted Carl F. Flood and Normarp E.
Walz to positions as As¬
sistant Vice-Presidents. Mr. Flood
was

$400,000

plus account of $3,200,000

The directors

Dec. 10.

of

profits

action increases the previous sur«

,•

RiggS^ capital from

transfer

undivided

amount

■

*

"

directors

Virginia

of

new

March

on

V-

The: board

to

rata

the

the

count to the

.

••'••• »r

of. the

on

dividend

first

the

and

pro

.

capita) will be declared

new

nounced

price

at

thorized
from

:Deane; Jr., -jboth 'of Richmond,"
.accomplished'by reducing the par
value of the Riggs shares; < from -additional shares resulting from Were
promoted : .to - Vice-Presir
the change in par value and the dents..'
Four p r om oted, from
$100 to $25; This will be the first
stock dividend. Mi\ Flemfng'Said Assistant
Cashiers
to
Assistant
stock: split
in the 60-year his¬
that
fractional
stock
dividend Vice-Presidents
were
Allan % A.,
tory of" the institution as a Na¬
tional Bank.
The stock dividend, shares Will not be issued. For the Campbell, of Norfolk; O. Watts
the Mr. Fleming added, will increase fractions, directors will appoint Gills, of Roanoke; Moreland H.

Company

Trust

Philadelphia:

!«

'

directors

of

.

1.

the

by

market

open

distributed,
-

March

sold

be

the

the holders.

share
extra on the capital stock of the
company,
payable. Jan.. 4 to
regular

on

p.m.

available

best

proceeds
The

2

then

in

trustees

creased

"Approval
of shareholders
is
considered
a " certainty.
Stock¬
holders
of record Jan. 8,
1957,
will receive" on Jan. 15 both the

also quote:

split, Mr. Fleming said in

until

sold

or

mil¬ ■12."

$2.3

as

combined

of

surplus).

that

re¬

four-

a

The

upon

Jan. 8.

by

Edi-

4

Fleming

dividend.

"Washington" Post"
"The

Dec.

of

Financial

recommended

stockholders

has

"Washington Post"

that

stock

it

by

Herald"

that

ported

posal rwill
of

is

Goodman,

bank

board

C.,

I).

"Times

Oliver

of

far-one

"The

par.

single loans

*

...

,

T.

An item in the

Bank.

-

in

announced

previously been President of. trie
.

W.

Robert V.
Fleming, Chairman of the Board.

Board and Chief

Officer.

Dr.

Speakman.

$7,250,000 capital and $15 million
surplus.
With $8 million capital
and
$15
million surplus, Riggs
will
be
in
a
position to make

ing-ion,

Mr.

to the office

Cole

E.

the Riggs National Bank of Wash¬

.The National Bank of Plymouth
County
of
Brockton,
Mass; an¬
Reginald T.

Paxton,
W.

increase

been

nounces

B.

and

tution
An

.

Chairman of the

H.

19

(2515)

on

page

107

20

The Commercial and Financial Chronicle

(2516)

more

factors

unfilled orders;

capital investment showing

a

which continues

pace

the

outrun
from

sluggish

internal

of

flow

such

sources

depreciation and retained earn¬
ings.
The incessant demand for

Technological
and long-range planning

progress

the

feed

boom

only
of

capital expenditure
so long as a favorable
profits is in evidence

and
in prospect.
relationship,
not

a

that

the

of

accounts

It

for

is

occurrence

neither obscure

change,

to look and

it

process,

be

may

and rising state-local borrowing volume. Author, how¬

we

what to study.

to

seems

some

plications

know where

me

interesting

very

the

to

In the

that there

art

ap¬

credit

of

a

have
continued
the
without
impetus

climb

strong

growth

this sound
which

analysis.
Factors

in

the

the

funds

induce gradually
diminished capital outlay, and of the inability to pass on higher
operating costs. Concludes bank credit analysts should study
"profit margins and return on investment in our institutions."

at

uation

Outlook

First,

what

about

business

the

last

it

in¬

erosion

present

kind

of

to

to

the

level

of

Does

of

boom

be

me

for

The sit¬

a

devel¬

gradual

foundation

for

business

of

and

demand

seems

the

invest¬

that you do not need be rebuilt by a
ment.
With the expansion of ca¬
It does not
favorite topic for view¬ ventories?
seem
pacity, in more and more lines
likely.
No
matter of
business
vent
Season
can
now
be
surpluses have re¬
quite ing with alarm. Any of you can particularly
how you measure it
(and there placed
shortages.
As
a
conse¬
appropriately called the Outlook give this speech as well as I can.
So, let us consider that I have are several valid approaches), the quence, it has been difficult to
Season.
From now until early in
made this presentation and stirred level of aggregate inventories does
pass along in the form of higher
1957, we shall
you to new determination not to not appear out of line in relation prices
all be deluged
increased operating costs,
let a long period of prosperity dull to sales and unfilled orders.
No amortization of the greatest costs
with
apprais¬
reductions in stocks of new plant and equipment, and
your perceptiveness of developing doubt some
als,
forecasts,
The Outlook

What used to

warnings

Season

called the Ad¬

be

and

year

has in store for
the

world, the
nation, and
the

essential if

upward

banking

I

have

tained.

penetrat¬

some

ing the murky
atmosphere of
1957, but I
the

with

F. Murray

Roger

of

effect:

forecasts will

The

be

will start

year

momentum that will

a

the

quite positive that

am

consensus

this

to

on

and
a

diture boom which cannot be sus¬

secret formula

for

prices for
the further
capital expen¬

pressures

goods
development of

no

to avoid further

are

we

industrial

business.
•

assure

rising level of activity lasting at
least through the spring, but there
are signs of a leveling off and per¬
a

I

that

assume

will

reserves

to meet sea¬

requirements

called

normal

growth. But these
be supplied reluc¬

will

reserves

is

what

and

tantly, especially

when the mar¬
financ¬
and
whether
the

ket is free from Treasury

ing.

When

discount rate will

be increased

is

of

matter

the

a

downturn

some

outlook.

time.

The

pattern

timism

expectation
of

one

the

our

quest

The

of

restrained

reflected

has,

this

of

been
resources in

economic

restraint

same

op¬

type

however,

greatest

for

the most

in

stability.

exercised

for

part of the extension of

bank credit has

tributed

the

to

speculative
decade of

undoubtedly

con¬

prevention

concerned

mand

inflationary

I

it

take

that

mind

for

the

ficer

is

this

good

a

had

loan

and

credit

a

little

more

fying adjective
of

the

has

on

than

prospective

not been

a

of¬

cautious

same

restrained optimism with the

phasis

of
or

em¬

the quali¬

in

the

case

borrower.

problem to

It

secure

widespread agreement, almost in¬
variably in word even if less con¬
sistently in deed, on the proposi¬
tion

that, although the outlook is
generally satisfactory, this is no

us are

vitally
de¬

the persistent

bank

credit

and

tight

the

be

prepared for a
situation
in
the

money

months

ahead] I base this obser¬
two

on

for

measures

funds

which

useful in appraising

very

of

I

the

find

trends.

to

kind

of

an

occupational

it their

of

those

outlook

who

business) to lend

make

money.

the

be

outlook,

therefore,

it

congenial to this group

although not

very novel or inter¬
You would nod, either in

esting.
assent
a

or drowsiness, as I
painted
picture of good business in the

months
*An

the

address

2nd

28,

of

while
by

Annual

Rochester
ter

ahead

Dr.

Fall

and

Central

Robert

Morris

giving
Murray

capital

the

trend

position

corporations,

in

corporate

of

shows

Conference
New

York

Associates.

1956.




of

the

Chap¬
Nov.

situation?

the

Apparently
not.
While depreciation accruals
are still rising, the rate of increase
ease

is

below

well

hectic

the

capital

investment

tained

earnings,

of.,

a

year

ago

payout

has

profits

have

below

Re¬
rate

dividend

rising

been

levelled

are

the

the

as

of

pace

outlays.
moreover,

running

actually

while

off.

the

In

aggregate, therefore, the internal
of funds available

sources

financial
will

corporations

show little

to

non-

the

in

increase

last
are

on

material

a

petitive
under

will

pressure

in

serve

change

I think that

forces

as

another

we

com¬

keep profits
we shall
ob¬

connection.

lays

for

The

ment?

plant

new

and

equip¬
s#ch ex¬

in
penditures which started in
upturn

shows

1955

sign
of
fading
refer to the
Department
of
Commerce
and
SEC series, the McGraw-Hill Sur-I

liquidity.

vey,

or

Conference

business
months

ernment

feel

as

a

securities

of

percentage

liabilities,
indicator
mand

we

of

for

corporate

total

obtain

the

a

trend

funds

expressed

are

in

the

the

on

business

current

sensitive
de¬

of

part

organizations.

48.0%

compared

with

55.0%

perhaps the most
precipitous drop of which we have
a
record.
Apart from seasonal
in

signs of

this

are

of

course

any

ceasing

to

lose

liquidity

investment
ahead.

that

we

can

start

looking for a moderation in
the demand for business loans.

Inventory accumulation from
30, 1955 to June 30, 1956

June

the

of

through

1955,

but

the

in

sales

industries

most

other

than the automotive group, profit
margins in manufacturing did not
improve and there has been a

decline

modest

in

the

rate

of

re¬

net worth.
Preliminary
indicate about the same
pattern of behavior for the third
quarter.
Concern over whether
the rate of productivity gains is
being
maintained seems to
be
fortified by the failure of profits
to
show a
firmer trend
during
turn

on

figures

this

dis¬

to

business investment would ap¬

pear

the

be the central question,
most important single factor
to

in the

outlook for credit demand.

The

ment
to

a

means

the

that

that

wre

tive

as

one

of

best

the

meas¬

ured

by the rate of return on
worth, thanks to better profit
margins and
a
continued high
rate
of
capital
turnover.
Less
net

rates

of

return

in

1956

do not portend a collapse

in busi¬
ness
investment, therefore,
but
they suggest that some of the
urgency is gradually disappearing.
Application

Credit

to

other

starting-up

of the trend.

The

indicator to which all of
well

give

us might
attention is the
profits.
Earnings are

more

only

a

but

also

the

trend

of

major

source

measure

of funds

of whether

retained

without

or

leverage

the

provided

greater

explanations

vanced

to

and

be

ad¬

can

the

excuse

failure

of

vigorous
recent trends
will be reversed next year.
It is
not possible to make a categorical

profits to show a
growth.
Perhaps

more

statement that the

earnings
benefit

by

Rather

we

must wait and

Of '

indicator

of
the
efficiency and
strength of the organization, par¬
ticularly when it is possible to

observe

the

in

trend

slackening volume.

periods

To

of

the lend¬

the absolute level of the return
be less significant than the
degree of stability demonstrated.

er,

may

By Way of
There

Summary

other ways in which
close observation of profit trends
can be useful, but I should like to
return

are

to

the

main point of this
Unless and until there

discussion.
is

moderation

some

and

to

equipment,
how

see

real

any

of the strong
expenditures on

business

plant

difficult

there

boom's

basic

without

foundation

long

a

the

while

to

is
be

money

of

the

may

vitality

meantime,

pect for

it

can

easing in the
My suspicions

situation.

be

take
justified. In

or

be

there

may

is

no

pros¬

material decline in the

a

aggregate of real estate financing
and a rising volume of state and
local

government

inevitable

pears

to

borrowing ap-'
a
long time

for

come.

Under

ume

the

of

of

circumstances,

restricting

weli

may

be

longer.
that

with
in

are

a

vol¬
for

us

However,

we

the

loan

a

still

I

era

new

straight-line advances to higher
higher levels of prosperity

and

have

it

is

not

yet

there

will

be

years

ahead.

irregu¬

or

correct

that

achieved
slack

we

Utopia,

times

When they

in

the

I
really concerned about the

not

am

come,

magnitude of possible loan losses,
but I think

loan

should all be

we

about the

cerned

volume

and

is

other

to

ness

going
This

to

earning

feed

it

back

doleful

good portion of

is

one

conclusion

devote

it

busi¬

no

again.

that

a

power.

lot of

a

lenders and

rather

con¬

probable loss of

The banks have fed

desirable
our

to
an¬

alytical time to the study of profit
margins and return
in

our

on

investment

institutions.

own

Rosenbaum & Russhon
New Firm Name

expenditure boom is about to
using

of

debt.

importance, however, is
as a highly sensitive

1955-1956 cap¬

ital

at

costs.

the function

Analysis

costs

Effective

Jan.

2,

1957

the firm

of Rosenbaum, Proskauer &
Russhon, 1 Wall Street, New York
City, will be changed to Rosen¬
name

baum

&

kauer
Dec.

Russfioh, Richman Pros¬
retiring from the firm on

31.

Francis
member

F.

of

Rosenbaum,

the

New

York

Exchange, will become

a

Jr.,
Stock

partner

Jan. 2.

on

in

appraising the quality of loans
and
loan
applications.
Careful
studies

are

1949, 1954,

or

whatever the date of his own pe¬
of

recession

There

Herbert Malkin Honored

helpful of the custom¬

er's performance in

may

have been.

changes

have time to study
to watch sensi¬

employing

with

suggests

High

Yet there have been no real tests

and

indicators

is

If

ranks

and

One purpose of emphasizing the
on net worth
is, of course,
see how
profitably management

to

interruptions

1955

year

further

return

larities.

the

business

situation

look

without

important,

most
business
organizations
in the of
capital invest¬ during the postwar period and the
develop slowly in response record of the prewar years is too
wide
range
of influences often meaningless.

fact

of

rate

to

revenues

With the exception of 1948

were

riod

Profit Trends

signal

a

details of

1950, when inventory profits

may.

and

a

as

the

doubt

the sensitive indicator
of profits to guide our thinking.

expectations

only

while

with

are

a

great

many

Herbert

Malkin,

co-manager

1182
Broadway, New York
City office of Hirsch & Co., was
tendered a dinner by partners of
the
in

firm

with

the

at

honor

of

the

Wall

his

25th

firm.

presented with

an¬

Mr.

Street
Malkin

was

gold watch.

a

Lipper

passed

Dec. 10 at the age of 80
a

long

illness.

ful

retirement for

The

away

following

founder

Arthur

thought to this matter of re¬

Club

anniversary

Arthur Lipper
Arthur

under less satisfactory
general business conditions. I be¬
lieve it is important to give care¬
perform

of

the

alytical techniques which may be
applied to judging how a particu¬
lar borrower may be expected to

x

customary an¬
alysis of "profit margins. In either
case, we have only an indicator,

However, a decline from the
excellent
profit performance of
us

meas-

of course, a

supplement to the

ties.

fill

preference

computation.

quite satisfactory

problem

not

of

after-tax earnings as a
tangible net worth is

period of rising volume and
heavy investment in new facili¬

should

the

of the enter¬

This represents,

ure.

of

of
a

new

subside.
us

fact,

of the

one

no strong

method

trend of

stability rather than
growth.
Despite a good rise in

see,

validity of these

not

slightly

for

of

In

shown

pressure

mercial

rose

pro¬

level

observers

ahead

volume of profits

very high activity
expanding markets,
In the process of observing the
of rising costs,
(3) technological progress stimu¬ aggregate experience, just as we
advantageously
watch the
lated by large and productive re¬ may
search, and
(4)
the long-range corporate liquidity ratio, there are
some
useful
applications to the
planning for secular growth to
which American industry has now daily task of credit analysis. And
made
a
firm commitment.
The we need all the help we can get

(2)

amounted to $9.0 billion according
to the SEC
estimates, while com¬

receivables

Some

have

we

pres¬

corporate liquidity picture. When,
as,
and
if we see corporations

the

high

because of (1)

series,

there are no
improvement in the

a

long period of

a

earlier,

year

Board,

1954

I have
the

to

as

the first two quarters of 1956 have

you

jections all show

of

mid-

no

Whether

away.

borrowed

of

quarter by quarter from the

start

favorable

Third, and of central impor¬
tance, what about business out¬

cost

The aggregate
rose

1956

over

figures.
Again, there
signs visible to me that
count

additional

money.

1955

year's

If holdings of cash and U. S. Gov¬

you

before

Second, what about the generof cash internally?
Will this

tion

trial

working

ent

credit

erally strong business trend.

the

nonfinaneial

If I
were
to
present what I
factors which
expect is the widely held view of

would

inven¬

the new series of appro¬
priations by
large corporations
assembled by the National Indus¬

relax

characteristic

of

rise,

The first measure, derived from
the SEC's quarterly estimates of

This liquidity ratio rose to 53.3%
vigilance, impair
at the end of 1953 and to 55.4%
lending standards, or depart from
at the end
of 1954.
It dropped
time-tested
principles of sound
lending. In short, the atmosphere moderately to 53.7% by the close
of 1955.
On June 30 it stood at
is
generally sympathetic to the
time

volume

the

On

in the situation.

of

better

demand

state

Credit

rationing which we
face. How long will it last? About
all we can say is that the turning
point is not yet in sight and that

vation

Occupational Outlook

all of

over

for

problems

a

pressures.

An

in

contrary,
some
although at a re¬
duced
rate, would be consistent
with
the expectation
of a gen¬

can

for Bank

For example,

we

despite

excesses

booms and

of

tories.

further

no

The Demand

dollar

gregate

be supplied to

banking system

sonal

balance

on

technique which we
during the
can t,safely leave to the discretion
second half of the year. This fore¬
of the authorities.
cast has been
a
popular one in
With
this
behind
us
and
se¬
almost
every
postwar
year.
It
happened to be good for 1948 and curely in the record, we are free
to explore what appeal to me as
1953, but the perversity of eco¬
more challenging
and more fun¬
nomic developments has not made
damental
aspects
of the
credit
it particularly useful the rest of
haps

inevitable

and

the position

tations of what
new

desirable

are

is that individual industries.
But
with
of the Federal Reserve rising prices persisting in proc¬
is soundly taken.
Under prevail¬ essed goods other than food items,
ing conditions, keeping a check there is no persuasive case for
on
the
availability of credit is expecting a reduction in the ag¬
The corollary observation

interpre¬

the

about my

weaknesses.

oj ections,

p r

prise.

to

indefinitely

present peaks?

suggests

liquidity
reduction in in¬

profits.

business

as

oping
ventories? Will corporate

like

will

keep

in

as

measures

health and strength

usually

penditures

funds

investment

on

highly revealing

percent

tion may

long-term

turn

direct

a

part of business, is then
nor mysterious. In
wondering about when the situa¬

and

the

on

Thursday, December 13, 1956

.

coincidence,

major upthrust in outlays
beginning in mid-1955 when cor¬
porate profits rose dramatically.
During the current year, how¬
ever,
plant and equipment ex¬

short-term

is suspicious of profit trend which may

ever,

at

as

sign of fading

no

worthwhile.

trend

to

liquidity; increasing business inventory in line with sales and
away;

the

At

be

to

will

funds

decreasing corporate

as:

cash.

on

capital investment continues

new

levels

cautiously
optimistic outlook views for 1957, and the past phrases
often used regarding lending standards, Dr. Murray explores
the more pertinent topic of demand outlook for bank credit.
Anticipates no significant easing in money tightness until the
turning point of credit demand, which is not in sight as yet,
Observes such strong

in¬

Federal

time, plant and equipment
outlays
were
reaching
record

University

summarizing and concurring in the general

occurs.

payables.

payments were another

important drain

By DR. ROGER F. MURRAY*

After

tax

same

Graduate School of Business, Columbia

Associate Dean,

than

come

Bank Credit Demand Outlook

.

.

of

Lipper & Co., of Phila¬
delphia. Mr. Lipper had been in
some

time.

Volume

184

Number

5594

.

.

within

Widespread Use of Automation
Key to More Prosperous Economy
Vice-President

and

General

Extension to

GNP

firms

offers

the

only

possibility

for

adop- '

"better

and

more

about

before

Automation

it

talk

we

would

be

a

them
ask

a

the

been

going

of the

English

V

?

What's

language,

it

whether

there

like

It'

it

in

used

as the prod
along the line, not suc¬
cessively in one place. So at any
single
point in the
continuous
process, the condition of the ma¬
terial has to be kept constant. At

-

these

Harder,

Ford

it?"

about

differ.

not

a

material

you
differ

that

To

some

the

two

Step Further

a

can

to

discrimination

m a

t i

c

han¬

-

between

mean

great deal

a

was

few

since

said

of

mechanism, which is
ful device that

automation,
hard

for

to

it is for

as

to

to

1947.

It

servo-

a

rather art¬

a

plays a big part in
"it is nearly as

that

the

art

servo

come

than that

more

years

once

practitioners
agree

a

on

the

of

definition

a

of theologians

group

sin." The same can
certainly be said of "Auto¬

agree

now

on

itself.

mation"
This

loosely

today

sion

almost

of

bandied

in

about

popular

machine

new

any

put in anywhere that

so

discus¬

of

The

seldom

Lewis

sure

been
at

us

these definitions

course,
to

seem

it

coincide.

Carroll

I

a

engine

which
with
As

was

it

word

means

the

it to mean—neither
I

prefer to think

ing:

all

to the

more nor

of it

leading:

machinery

for judgment. This

does, of course,
imply that automation is not a
new
phenomenon. Equally it im¬

plies that automation is not a sin¬
gle easily identified development,
but a confluence of separate in¬
dependent streams of technical
progress.
For a definition of tho
portmanteau kind take this one:
"A

contemporary

dependent
of

advances

mechanization

in

This may sound more

definition.

like

a

list

include
♦An

them

address

National

by

Industrial

all

and

common

to

give

Coles before the
Advertising Associa¬

Mr.

tion, Pittsburgh,




naturally.

the

the

balls

The angular
through a

arms

transmitted

to

the

and

the

stant

speed In spite of a varying

load.

wide variety

a

Oil refineries

to your

of instru¬

m

approaching the

are

%

jacquard loom that weaves

according to the direc¬
tions of a punched card is another
early example of automation, this
pattern

time

feedback

without

that

was

the end of the
17th century.
Whether or not it
is profitable to devine automation,
it should be fairly easy to dis¬
tinguish automation from mechan¬
ization; and certainly we are go¬
ing to have plenty of opportunities
developed

to

do

before

in the future.

so

Give

the

idea

of

linking

se¬

a

into a con¬
tinuous
process
without manual
handling between operations. In

process industries, that is
engineering industries was

★

machin¬
Detroit Automation as it is

next

the

ing or

it

where

was

adopted first in

any

great degree were precisely those
industries where the materials be¬

processed were difficult to
manhandle.
Therefore, those in-

ing
d

u s

t

i

r

e s

processing liquids

become

automation.
were

of

stead

the

first

to

or

adopt

First batch processes

instrumented by using temp¬
pressure,

indicators
trolled

Chronicle devotes

of

flow

continuous

a

worked

and

moved

are

'<

all

gory

that

-controlled

techniques

other

of

30 different

Chronicle?

tape, or

by

features, including Securities

program¬

and

flow and

the

the process

operator

level
con¬

by manipulat¬

ing valve using these indirect in¬
dicators

to

tell him

of

conditions

With Tradition

Break

automatic

Where

is

assembly

becoming economic in fields other
than the automobile industry, this
has happened only
and

where products
have been com-

processes

Tremendous

redesigned.

pletely

have

electronics industry

in particular.

record

data

»

'The Chronicle

publicized are Project Tink-.B
ertoy and the techniques of using g
printed or etched electric circuits «
and automatic parts insertion ma«
chines

which

have

in

resulted

a

was

securities;

earnings,

and

a

f

founded 117 years ago to

■

,

.

,,

,

help its subscribers to be acknowledged as the
best posted individuals on financial and general

&

business affairs

look both in the- «
parts themselves and in the fn- ^
ished product
The old familiar w
rats nest of wiring is rapidly disg

in

their community.

•

new

appearing from our radio and TV
sets as well as from military and

privilege of receiving this publication.

th

r

°

°

r

k

R

itself

.

Today, many thousands pay $60 per year for

ft

instruments

j

announcements;

dividend

of

Corporation

on

•

both listed and

on

Municipal News Section.
1

;

Well

completely

Monday Issue includes

over-the-counter

latest

$
22

in

The

quotations

complete

-

Offer¬

day edition.

Purpose?
jf
$
Sf

and

Registration

ings sections, in the Thurs¬

What is its

the

made

been

departments and

Prospective Security

automobile

Must

In

Now

However, as we know, in
industry, while
certain parts of cars such as cyl¬
inder blocks and pistons are now
made automatically, the car itself
is still put together by hand.

ming.
the

All told, there are some

What is the

tools

machine

of

forms

are

and special

by top authorities—

banking and business lead¬
ers.

also include in this cate¬

may

edition to current invest¬

articles

matically, the function of the ma¬
chine tender is only supervisory.
We

an

ment, financial and business news

auto¬

on

Financial

Every Thursday, The Commercial and

in¬

where,

industry

of

★

★

Transfer

step.

homogeneous material, the flow is
one of discreet units.
These units

^

electronic

it

because

did

not

lend

to

automation.

of operations

this connection the industries

CHRONICLE

THE COMMERCIAL & FINANCIAL

non

the

to

Subscription to

a

extension of automation to

The

the

★

★

★

drop dead.

industrial

essential feature of automa¬

An

gift problem

Costly units of plant may be op¬
erated cohtinuously with no more
than
two
operators on duty to
keep an eye on the instruments
and only take action if a major
disturbance takes place; two op¬
erators simply because one might

strides

The
a

Best

solution

continuous chemical processes

contain

and consequently
and opening it as

rose

22

on page

Most units of mod¬

tending to close the throt¬

erature,
to

arms

their ends.

rotated

But these tech¬

niques do have enough in

at

to

the balls fell. In
engine was rrsade to
control itself, using the principle
of feedback, at essentially a con¬
short,

gases

computers."

the

and

the speed

as

quence

ing, accountancy and calculation
involving the use of electronic

shaft

pair of

a

balls

was

tion 'is

ing concerned with data process¬

a

tle

of in¬
field

the

teristically employ discriminatory
devices
and
automatic
controls,
including transfer machinery, au¬
tomatic assembly, the whole field
of control
engineering and that
part of communication engineer¬

than

lever

charac¬

group

which

of

movement

less."

includ¬

to

into

fly outwards and upwards

speed

as

development of

attached

a

centrifugal force.

the

devices

technical

to

rotated

shaft

balls

just what I choose

fire

by Watt in 1778 is

iron

cast

the

lowing words into the mouth of
Humpty-Dumpty. "When I use a

steam

perfect example of automation.

have

must

a

the

man's physical ef¬
familiar flyball
gov¬

invented

ernor

am

looking into his crystal ball
today, when he put the fol¬

between

heat from

The

Of

what

and

steam

tion to replace

isn't.

is

Certainly it

using

engine

the

convert

throttle

the

proc-

a

mechanical energy to drive a shaft,
is a prime example of mechaniza¬
forts.

Continued

.

desired condition followed quickly

portions

two.

such

computations

the

sometimes known embraces those

automation

many

to

correct deviations from

to

as

minders.

Watt's

>

reliability of automatic contros
°^er greater protection to both
property and people. Industrial
accidents are at a 43-yeais low,
right now, and this has been

course,1

use

trates the difference

what

irritated

for

discover examples
early in the history

to

mechanization.

would

been

of

The

engine for example clearly illus¬

of us
point
attempting to produce sharp
and exactly limited definitions of
have

about it?

hard

not

machine

most

new

of automation

The

is

word

required

from

is

processes." It has

these

still

precise adjustment of

What's

p r o-

duction

in

judgment—the

man's

ess

pro¬

gressive

replace

the
V. Coles

Ralph

of

of automatic
adjust¬
by feeding back signals so

right;

ments

point where 20% of their capital
cost is actually for these controls.
Is

Many industrial processes
inherently dangerous.
The

are

the

mentation and automatic controls.

underlying

process

a

The third is

make

ern

basic

"The

dling of parts

of
to

But, I think
differentiation

usefully be
thought of as replacing man's phy¬
sical effort by mechanical energy;

o-

him

different

automation goes further and tends

t

condition

and enable

a

to describe
a u

like.

than

consistently

controlled by a man.

controls to carry out these

has

Company
,

the

of

formed

a

•Mechanization

Motor

the

process

points instruments were in¬
to keep the operator in¬

is

there

a

more

productive

more

Subsequently,

office

Day

automatic

payrolls, inventory control and

as

The second is

in and day out an
will turn out
product of high quality much

quality.

has been extended to many

use

routine

be

should

Automation

Vice-Presi-

its

possibilities of higher profits

stalled

words.

dent of the

work.

opening

thus

mathematical safety.

complex

thematician for

taking

are

cheaper
methods

and wider markets.

Actually, that was
for developing

adopting

by

made

be

the

motive

but

adopts automation. The
the product can

automatic

com-

calculations and relieve the ma—

uct flows

S.

D.

tive,
im—

place simultaneously

for centuries?

on

philosophy

1947

Mr.

does

of you.

proc-

critirallv

more

Tbe changes

portant.

But

mechanization

new

because

firs t

was

by

we

not.

or

label.

automation

does

from

part

a

a

point in the continuous

prosperous

common

"how

word itself has

become

of

adjustments if the conditions were

good idea to try and define it. The
now

all

to

separate
as

becomes

not

that

suppose

field

computor, to perform repeti¬

life that lies ahead."
I

commerce

auto¬

initial

ically joint computers; and (3) many familiar products will
require redesigning and entail a selling job to the public. Con¬
a

as

ess

25% to meet expected demand; (2)
can, in many cases, justify
their operations, and be able to rent econom-

to

of

the

necessary

road

the

in

ex¬

are

and

industry

why

reasons

there

that

me

first is economic:

form

putors and office machines. Here,
I
think the example of such a

proc¬

any

smallerspecialty manufacturers

the

lies

mation

years

1'

'

to

Automation

for

Reasons

seems

four

the

ten

cludes this is

of

scores

basic

third

the

new

years leaves deficiency which can only be met through
industrial mechanization and automation in order to increase

,

of

—:

-

It

product or a selection of new ones.
The condition of the material at

open wider markets
higher profits, and permit processes formerly not possible.
Mr. Coles points out (1) 14% labor force increase in next

in

traditions

ists.'

Four

in

was

which to

industries

other

In

break.

Other Fields

dergoing a sequence of
changes until it emerges

large

achieving

and

automation

such

that there

beginnings

fact little tradition with

oil refining, the material flows through a succession machine carrying out a calculation
in minutes or seconds is familiar
of stills, columns and reactors, un¬

$560 billion target set for 1966,

productivity by

its

of

each

controlled

In the newer continuous

esses,

Robertshaw-Fulton Controls Company

industrial

Then

were

The

Manager

Controls company executive asserts it is inevitable that
tion of automation by smaller businesses as well as

vessel.

variables

automatically and the worker was
released from his position of being
an
adjunct of the process.

By RALPH V. COLES*
Assistant

the

these

/

21

(2517)

The Commercial and Financial Chronicle

.

g
g

The Commercial and Financial Chronicle

g

25 Pa,.k pI

have to have the courage to

g

concepts

new

completely if we are going to sueThis

ceed.

will

require

selling

a

^
^

job if we are to get the public to

K?

is

New York

(8)

N. Y.

1
'

' •
|
$60.00 for which please send The
Commercial and Financial Chronicle for one year
-

1

tradition

with

break

and

ABi\rn

CHRISTMAS GIFT SUBSCRIPTION ORDER

We are go-

entirely

try

-.incAnmriAu

«•

many

to have to be evolved.
ing to

.
Air_

industries
are going

automate

To

h£

am

enclosing cheek for

To

«

accept these ne\u designs; for it
in

the

the

it

these

is

that

mass

will

matic

is

subject to

markets

and

U

g
g

has been

w

The

new

and

.State

Qty

alone

electronics

so

so

lie,

susceptible to auto-

assembly.

industry

markets

mass

he

that

goods field

consumer

major

much change since

.

,

.

.

M'nU°n that ,h* " " a" ,r°m

.

22

The Commercial and Financial Chronicle

<,2518)

Continued front

J

t'ie £i'°und

21

pace

'

*

IWf

lAllfl ACfirDSn

llCH

WVllivdlJi Vt&ti

vaw

mm

m-

It

IV

_«

>

V*

•

«AiAIVUIHkAVil

'

m

* t

°
-

in

achieved

part with the help of
automatic

and

instruments

con-

nish

his

home
in
Cuernavaca
Mexican
products, all the

with

is that it makes

certain
processes
that
were not possible before.
But, the greatest drive to adopt

dian carpenters. When he found
a chair that was not only comfortable but reasonably priced, he

automation

asked

possible

undoubtedly
nomic

mechanization

and

the
the

one,

productivity.

first,

Now

going

to

10

years

sfn.

10 years.

And, in those
labor force cannot
more than
14%.
We

our

by

expand

therefore

must

haven't

see

Product

in the next

I
i«t

o

private then we
our
Gross Naexpand by 40%

and

government
are

the ecofor greater

need

Htith

ticnal

is

get

productivity

greater

and

greater

from

each

wcrker.
,

_

Only

to Increase

Way

him.
"The Senor knows, of
course, that if I make more than
one,
I must charge more, much

than

more

he

Piifh"

fnr

mnrp

But

cial

it

may

does

good

week

the

as

of

ore

cicizens

work

week

per

is

by another 25%.

increase

lv;ur of between
—and this
10

next
we

is

It

obvious

is

ever

an

that

this

mechanization

tarnation to

man

1.6 times

accomplish

only

can

per

l.o and

to be done within the

years.

.adopting

hour must be

man

total

a

day

distinguished
forecast,
then

further increased

This

from

lour

a

our

recently

the output

week

to

and

its

In

effects

can>

the

g;;rding

expressed

social

and

re-

economic

upheaval that will be caused by
automation, that we are about to
become

nation of

a

evil

causing
ment.

oi

consequences

employment,

esteem

widespread
unempioyapart from any otner

But

considerations

riding

there

is

over-

one

that must push us on to
automation to an ever increasing
extent.
Whatever
the
one

adopt
risks

to

social

our

the

risks

of

or

machine mind-

falling

economic

behind

countries

is

other

immeasur+

ably greater.
To paraphrase we
have simply got to keep up with

the international Robot-Joneses.
Actually the speed with which
«;e can automate is strictly lim-

utterly
dependent
on
our ited if for one reason
only. Autorobots, in fact becoming robots mation is itself
subject to a form
ourselves and losing our identities,
0f
automatic
control,
and
this
e:s,

?:f;1

r-control

alone

will

jn

prevent

any

rent

time

at.

a

computation

in

of all subjects.

England

the

product

that

.

government

is

double

to

the

computor

isn't

c o n

t

11

r o

e

d

*n the field of automatic control
?n improperly designed or adjusted servomechanism may
a
great many more of "bunt" oscillating about the conthe engineering
indus-, dition it seeks to produce. Thus an
using

now

instruments

and controls to

I

some degree, And,
absolutely certain that they

am

could

use

them

output of technolo-

in

gists and technicians and this plan
includes not only the universities

tries, in the process industries and
in other miscellaneous manufac-

but

luring

technical

what

know

are

institutes
the

as

technical

u.*u

vftal

and

going to be

problem that America faces

automatic elevator which "hunts"
JTiay overshoot its floor, then stop
below it, then go too high again as
h *n the hands of an inexperi-

not

to have long

necessary

manufacturer.

his

large

is

it

+A

And now what of the Future:

In

And

auw

-

today.

Major

activities.

en

lag

rnmnntPM

hnntine

in

the

ran

control

Tn

Prpiiirt

Rndn»«

<-omPuters lo i reciict Business

just
five
cylindrical
parts
and
grind them down to" a close toler-

Industries

time

Riirh

signals.

along with the
But say he has to make

us.

onerator.

ducing

He has to increase

productivity

rest of

red

Cycle®f

.

I,-

'

Economists are coming to realthat booms and depressions
a big way are the major industries
ar® the "hunting" of an impropwho have a mass market. Most of
erly adjusted servo of society. It
these plants are concerned with some more and so on until he gets
Joes not seem to me to be too
munitions,
motor
cars,
oil > Or the five parts just right. At least., /farfetched to believe that a cornpetrochemicals. In these industries half his time
is spent starting, putor of sufficient capacity and
there is little need for
versatility stopping and gauging.
capability when fed the approprimeasure

that, have

jn

adopted

production.

anced

plants

the industries

automation

in

Completely

baltherefore be de-

can

signed and built to manufacture

a

specific product or a series of very
closely related products, flexibility has been sacrificed.
•
jn

the

industries

process

analytical

instruments

new

being

are

developed
to
measure
product
quality and composition, a trend
toward end point control that is
just beginning. Some of these instruments

can
still only be used
sampling basis but some are
already being adapted for vcon-

on

a

tinuous
many

stream

measurement, and

will

more

be

developed in

the future.

In

these

major

visualize

can

industries

we*

master * control

a

external

ance

it

diameter.

He

does

.

by cut. and try. Skim off
a little, stop the machine, "mike"
the part put it back and skim off

•

*ze

now

For

a

ture he

information, will not only

relatively small expendibuy

can

lejpveness ot possible corrective
£CJ101'1S■
nave already mentioned the

eter of the piece is at all times.
With electronic amplification, fur-

thermore, instead of limits of
thousandths of

ten

inch

an

the best possible accuracy,
gauge to one one hundred
sandth of

inch and

an

A

development Of instruments to
measure. Product Quality in the

one

being
he can
thouto

even

well

the

\ J?

™
°

,

one

+o

e

Jthf'«?'•»

millionth of an inch. And, we
have doubled his productivity into
one

the

bargain.
If a slightly larger '
number of similar pieces is required the machine can take the

output of this guage and use it to,
control the machine automatically..
This will permit the machine to

system which, taking into account" adjust the size of the cut in pro-;
the optimum possibilities of the portion to the deviation from the

plant

in-

falllhly point out dangerous
f °VJ- econo"?y ■
w1.11
attirm or deny the ef-

device that will

a

his piece

continuously and
show
him
without
stopping the
machine, exactly what the diamgauge

^

P0en?n€« ?n

thS

„r,n|;J!1tirn J

tn

7?inrirn»c

TWic

pGtentSlv

has

a

Wo

mti» hovim

almost

ndeHnite

"nn h
f
? inhprenilv
f "a rpliahilitv than thp vai
tl,hp aiPo ii rpnuirpl m.rPn
tn
LrX t L
♦

'
,

e

r

p

n

r

nnwpr

desired size, thus taking big cuts wasfpP mnrh Ip^P of this nowpr
rate of its final
where they are permissible and thknThptnhp inthpfnrmofhppt
either
continuously reset other speeding up the process by ancontrollers throughout the plant other 50%. We've now got a comh^7Pnt advantarps ovpr mechan
to bring about the best results or bined increase in productivity on,
as

as

quality and
products, would
,

.^11.^

controls/ One
its
2 >■

is its speed;

capability of almost

amplification.

These

...

,/

-

.

,

^...

It

often

tC-at

those

ecftific
a-.e

of

ferent
cuite

and

work, or

them.

untrue,

I

I

sci-

on

automation

ol the social

our

to

assumed

working

us

controls

unaware

t.ons

be

to

seems

of

implicaindif-

are

think

think

this

it^ is

is

more

matic

control

himself

trained

maintain

him.

the

A

machine

or

to

not

for

care

device

is

and

that replaces

fairly comprehensive

training

course

must

given to

be

is

re-

necessary and
skilled machin-

ists and foremen and if it is given

it is

now

the

computer

will

enter

much

field.

Both

series of

in

the

control

in

and

processes

of

nating the work of different
"automated" departments in engi-

>

*

that;

'

.

"

;

vital

nomics

in
of

the

inflationary

the

productivity

world.

can

opened

for

its

va^st

use

"sensing and measurement of

in

very

sman

High productivity is recognized
as

have^

applications

new

Vital for Inflationary World

a

coodi-

as easy as

.

directly into the production

more

characteristics

,

is not a1^

being gradually applied,

eco-

Maximum-

be obtained from

changes and in high speed
communication or transmission of

intelligence. I
one

example

tronics

would
of

which

I

the

like to take

elec-

of

use

recently

ran

find

into

rather

fascinating.
but

2es,

side

to

ol

sc.ous

As

this;

of

many

us

are

con-

positive social mission,

a

soon

as

it

become

scientifi-

c./lly possible to replace a human
function by an automatic
function,
and
this is not done,
the blunt
t'.uth

is

that

the

man

himself

gineers
increase
devices

all

of

these

as

is

sorts

more

this increased

to

complex

putor

will

serve

assess,

■
.

variables

even

Admittedly

in many cases there
huge problems to face in mak-

abroad.

outside

the replacement.

quirements

moral

ivore

tendent
a

id

on

social

to

the

run

seems

risks

at-

altering the industrial
structure, great though

tbese be, than to degrade human
'populations to the status of automaeons.

It

is

tentioned
gers

of

an

"the

remain

t-.onal

r>

well

in-

eyes

are

impending dan-

industrial

human
so

should

f1

wail

T

i

a

to

of

complete
the

mis-

future

re- '

engineers

and

technologists in this country since
the war, far too few young people
have been steered towards the
scientific

occupations. Less than
half the engineers were graduated
in 1955 as were graduated in 1950.
But beyond that there is a steadily

worsening
schools.

situation

One

American

in

our

quarter

all

affect

may

means

needs

the

controllers

into

account

might

not

only

of
we-

paramount

either

consideration

this

*

•

Lesson of the Bees

total

of

make the interests of the customer

the

'

disregard for

this

the

Prior
and

to

1851

beekeeping

around

the

.

honey production
v/as

bees'

centered

instinct

to

By swarming each coloiiy
produced about six daughter colo-

swarm.

the

collapse of th'e nies in a year,' and each colony
productivity;
In. produced honey in small quanfithe firm would soon
ties.
At the end. of the. year all

in

own

event

gramming

tility

particularly

been that of regular examination,

those subject to changes in fashion, in season or technical design,

This allows the appropriate action
to be taken with the colonies con¬
taining the queen cells. •

as

adaDts

'

.

insofar

imDroves

it

as

and

,

learns,

recognized

.

+1

....

■

Qulckly and erriciently.

Why
man

offer

no

should

and

no

with

20th

century

geometry.

In

schools

offering

swer

control

must

set

out

to

we

seek

automatic

replace

to

devices.

The

simply is that the brain

an-

can-

essential,

are

Automation

in

the

plant

is

not

going to sidestep the multioroduct
plant, the smaller manufacturer.
The

automation

engineer

will

In

1851,

L.

L.

intro-

Langstroth

by

preventing . swarming found
tkat the yield of honey and it's
quality were
greatiy improved,
The difficulty still lies in
preventing swarming and for a -century the only

method

known

has

This regular examination entails

opening and examining the'hives,
a

laborious

and

dangerous

opera-

thlf

1
'nprjni/ahKM cou£f]/s not assimilate enough facts: it solve problems of flexibility at the tion vyhich disturbs the bees and
quality is aeploiably low. The
plant level. But product versatil- tends to decrease the honey yield.
number of graduating teachers canQ°t sort the facts quickly
demanded by the market and
It has been found that bees make
-it

,

anecdote

in.

qualified to teach mathematics has

that

fallen by over 50% in the last five

am

When Dwight Morrow was
appointed zvmbassador to Mexico

he decided to fur-




But

for

duced the movable frame hive and

schools

ct.ake.

k.any years ago,

disregard

duction

physics

delree me.point i
tlS^Dolntramtrving^o fin^ento03\th°u- graduatinS only
trying to 60% enter teaching as a career.
cegree

priorities..

not

give maximum service and to get
maximum productivity.
The cost
Why should we want to intro-- of inefficient production control
duce a computor to direct or con- is always great; its "cost in an
trol a plant? The brain itself has automated plant might be bank-:
the right qualities to handle the ruptcy.
There are many indusproblems of planning and pro- tries where flexibility and versa-

no

Journal

a' total

well, for example dis-.
stocks, and changes due
to seasonal demands.

high

?n

and

tributor

high

of

that

take

chemistry,

,

read

btreet

to

as

complex continu-

a

master

occupa-

Social-Fennnmin

Kecenuy

Due

technologists

this

to

of

bereft

scene

element"

blind

indignity

Possible

;..ie

to the

that

whose

people

vide open
c::

ironic

Need More Scient sts

calculation

work

producers

systems engineers and mathemati-

But it

maximize

of

would result

Such

i. g

to

com-

plant
operation and controlling the
plant to achieve this continuouslv.

and

ave

the

plant, by finding the best pos- customer and therefore loss
sible combination of the many, his goodwill.
Conversely, if

fceing operated as an automaton.
This applies
equally as well to the
c.erical
functions
of
industrial

extra

of

ous

tion workers is difficult to

The

ability
be used

may
the output of

demand

.

same

much

to offset the reduction in produc-

is

The

How

installed.

are

bound

Compare Russia
last 30 years
tem has been

—

where

in

the educational

the
sys-

virtually built from

■

.

What of the smaller

>

planning to spend the equivalent
0f nearly a half a billion dollars

without

by fabric, whatever the risks or benefits to our spiritual individualities,

increasing ae-

been

it

the

extent

overful

inflationary period
I believe, be only
mitigates to some

an

since

industrial
nave

Fears
unemployment

cause

au-

gcee*

Fears

so-

been pretty thoroughly dein the long term.
Certainly in a vibrant and expanding
economy we need have no fears,
in a time of slump it is possible
that there may be some inherent

r.iod reduce

day

the national

on

and economic picture?

dangers.

five

possible effects

what of the

of automation

school system

year

pnrnenter

country it costs less if one buys
in quantity.
Vvhy do you charge
more?" ''Because Senor'' replied
the man impatiently,
it is so dull
to make 12 chairs just alike."

today, assuming a constant work
week. But, if we in the same pea

the

cnir?

bunked

oucput with only a 14% increase
iti work force, each worker must

produce 25%

dozen

a

have

4

Output

increase of

40%

make

to

man

for

that

To achieve this

the

to

Thursday, December 13, 1956

i

productivity and customer's satis-/
Russia will have had 10 years of
plants, and can they apply auto- faction and provide
a
pro.£rarru
mathematics, six years of biology, mation techniques also. Very def- giving maximum compatibility of
five years of physics and four initely. In fact, I don't think there the two. Actually, this can be done.-.
years of chemistry.
Science and-.is a single industry in the. stands now ofl the giant computors but
technology are held in the highest ard industrial classification lists it is not yet economically feasible.,'

furniture tc be hand made by In-

fourth

The

trols.

Small Businesses, Too

peo-

.

multipoint-center, manned by experts, who
ent, in those over 40 it is between factories?
Is
there
a
place for will feed into their "brains" all
30% and 55%. Every student leav*- them in this picture of large one the factors affecting both works
ing the. 10

Pr ACTIAYAIIC r.rAVt A11117
VdJfVlVIAa) *IVV*iW*»»Jr

1"* WAV

Illiteracy in

up.

pie under 40 is virtually nonexist-.

AllVAlflAflAll

At

a*

t A MaTA

Air

lYCY

■'

.

..

enough;

it

the

facts

long enough; it is subject to

emo-

tional
,

.

cannot

and
...

store

nonsignificant
.

,

noise;

have

none

of

flexibility provided by the
automation engineer have still to

be programmed to satisfy the

tomer and achieve

.

an<^ ^ 1S no^ indefatigable. Computors

piant

these

shortcomings in principle.

Here

five service

is

cushigh productiv-

where

a

compute!/

really be applied. Even
the smaller factories will be able
can

certain
normal

significant
is a

sound,

sounds:

The

constant

note

of low frequency. Then there'is
a

warble tone of higher frequency

made by the
queen's
declines.

rate

nurse

of

bees when the

laying

This constitutes

seriously
a

warn-

Volume

Number

184

5594

*

The Commercial and Financial Chronicle

.

.

(2519)

23
t:

ing of an impending swarm. Last¬
ly there is a hiss of relatively
high frequency which occurs when
the hive is disturbed and is
of health in the queen,
Sore of the colony.
A selective

a

sign

President, First National Bank in Dallas
By ARTHUR B. WALLACE

amplifier with, three

After

outlining "tight money" effects and. the. little or no
the, economy,, and tracing inflationary implications
of periodic wage increases, leading Texan banker states it is

switches has been designed for the

analysis", and

effect upen

of

measurements

these sounds (The

Apidictor). This

is

difficult

.provided
with
a- microphone
pick-up which is inserted into the
a probe, making
thq normal hive dismantling un¬
necessary, except at the beginning
and end of the season. By reducing

disturbance of

honey

yield

hive

Since there

it does not

electronics appears to have found
market

new

this

here.

particular

tion

that

where

only
an

indica¬
every¬

as

take action if

Gains

Leisure

and

considering the subject of
night money," let s first see what
we mean by "tight
money." Without getting involved in too m ch
leciinicai

.

more

which

to

spare

them.
He is
time for leis-

more

other

day bills in

provide

have

going to
and better

are

more

raw

fund/*at

j

er

r

est

ra^es

we

have

b

e

a

c_

customed

we

be

great deal more efficient than h

a

all

are

going to have

we'are toaay in using taem.-

to

paying.

efits

of

•

.

it

better

and

lies

more

ahead."

.

two

prosperous

tionship

'..

Freeman

.

that

the

increased; cost

the government and

to

_

taxpayers

that John

r

?

ine'

formerly
y

,

~

'

'

:

-

with the Bond

Bankers

Trust:Com¬

has

pany,

not,

when

about

than

market

be-

ever

aware of it or ernments were
think
and
talk ;lheir
normal
construction
"tight," we gram,- and
they
have
not

we

pro-

being

money

caught up.

Lanston

able.

ha ye

Inc.,

-

*

&

has

spe¬

cialists in U. S.

yet

Almost

all

of

areas

creuit

have enjoyed.

The U. S. Depart-

continued^ to

Government

Freeman

residential

in

moved

construction,

will

John

P.

Freeman

devote himself

in

multiple-line

Others

lines

covered

These

companies.

by

the

companies,

affiliates

are

creasing
there

activity

more

perienced

green

workers,

workers

among

begets inis because
and inex-

This

losses.

are

fatigue

more

working

longer

finance

of

the insur-

carry

end of the business, we find thafc
some of the bullish commentator;.*
consider that

suits

1956

acting

are

investment

as an

re-

offset to the-

ance coverage for the parent com- underwriting. And so it was.

and normally report exceptionally low expense ratios simply
because the parent carries much
of-the expense, and there are no
PaiW

But
what may the prospects be? Is.
losses are to continue high the
companies will have less invest¬
ment money to put into securities,
If losses decline, and this is not a
widespread expectation among insurance men, the companies will
still be faced with declining portfolio valuations in the presens '

sidering the large companies, for lower markets.
'
it is the stock of the larger units
The year 1956 will show a very
that individual and institutional sizable
shrinkage
in
portfolio
holders

not

They certainly canthe stocks of the affiliates

own.

own

bor-

the

there

his

money"

is

He

none.

troubles

the

on

he

situation

may

nas

"tigut
-

:

-

market

money

in

market

bills

dealings
other

and

the

of

HARTFORD, Conn^— Conning
Co., 15 Lewis Street, members
Jan.

1

York
will

Stock Exchange
admit. Josepii o.

Kahlmus, Hughes

MERIDIAN, Miss.
of

Kahlmus

The

—

and

fi'rm

Company,

Building, has been
changed to Kahlmus, Hughes and
Company.

James Caine Opens
RENO, Nev.—James E. Caine is
offices

securities

a

at

15

East

business
First

St.

•

Edward A. Purcell
Edward A.

away
.

condition

A.

Dec.

Purcell

8

at

&

the

„

...




definition

of

money

—

whstner
-

"tight"
S

or

Largest

valuation, compared with the 1955
year-end;

it

and

doesn't

matter

" J
"
outstanding equity holder, as Inwe
examine the* surance Co. of- North America is.
companies whose In the former case, if interest

v
if

the

of

mill

insurance

shareholder,

we

Fire

losses

continue

to

about

run

Federal

cent

Reserve

-

re-

action

in

permitting the commercial banks
to

higher

pay

interest

deposits is

savings

an

rates on
indication,

period of 1955. certainly) high-grade bond price;.:

io% above the like

sum

demand

•

comes-

from

and

from

con-

seeking to finance durable

consumer
items such as houses,
automooiles, appliances, and furniture.
~
:

and
half

mnrp

know

remains

that
a

the

major

govern-

force

in

Co.,

%
1956.

conditions;

.

,

half of last
have
also
added .substantially to their inventories. Book value oi inven-

of

course,

with

but

being

the

,

unfavorable

i

^

contributes

that

item

Another
to

„,:i1

„

Llx

increased

nionths at

underwriting

year

first six

months

business

corporate

over

three and

a

nthirwisp known

Koenin
are

Francis

I.

South

Calif. —Gel-

Henrv
V
dllU
neuiy
V„
affiliated with
and

rvueiug

now

Pont

du

&

Co.,

677

Figueroa Street,

H. R. Baird Opens

the nack-

as

TARRYTOWN,
R.

Baird

m

n

^

j

before

where

es

occurred

him.

to

it

Not only

Y.

N.

is engaging

—

in

HarolA

a

secu

rities business from offices at 16...

Riverview Avenue.

of

oo-

half times

ANGELES,

q

i,arci

IldXU
KJ.
Thomas

showing is the householder's pol-

first 1C^>
$7 a&e

the

(special to the financial chronicle)

LOS

annual rate of

an

During the
this

tained

during

Two With F. I. du Pont

the

otherwise known as tne packpolicy. Such heavy advertising
to
sell
this
policy has
billion compared with $4.o biihon pressure lP/e
a
" y
7
during ]955
been exerted, that it has made
tories

He was for--'

merly Wlth E' W' Axe & C°" InQ*
B. K. Passman

Opens

Sned^nTheTame^eriod o/^Ts
pcriou

does this policy increase thot num_
the wgfg
upr
pioirnc for Io^ps

ine^for'bank ^mdTbv-^n^ra"

never thouSht of before, but it K. Passman is conducting a semakes for greater expense. Many curities business from offices at
insurance officials regard it with 1424 K Street, Northwest. He was

..

T
It

ine

Sarnc

Pa
Pc
interesting

is

to

than

banks,

of
securities
•

xyoo,

dpi^iiv

that

note

of

Department

reports. that

ings

oi

inrrpn«pH"

,

.

0 f'

the

in

that

reduced

S.

U.
by

their

other

hold¬

Government
billion
dur¬

$6.2

ing

for

the

$3.5

purposes

billion

of

refinancing,

out ; of

$6.2

NATIONAL
of INDIA,
Bankers

but

billion
year

on

page

108

BANK

Christiana

LIMITED
Government

in

Colony and Uganda
26
Bishopsgate,
E. C. 2.

Kenya
Head

the

to

Ofiice:

Securities Co.

London,
West

(London)

End

Branchi

Bulletin

Request

on

13, St. James's Square, S. W. 1.
In India, Pakistan, Ceylon,

Branches

Burma,

Tanganyika,
Zanzibar, and Somali-

Uganda.

land

Authorized

Paid-Up
Reserve
The

Bank

Kenya,

Aden.

Protectorate.

Capital

Capital
Fund

£4,562,500
£2,851,562
£3,104,687

conducts

every

description of

banking and exchange business.
Trusteeships and Executorships
also

Continued

WASHINGTON, D. C.—Bernard

formerly with Coombs & Co.
J

Commerce

corporations

during the first half of this

age

This,

favorable development under

8reater JVOlum^ °l
.

first half of 1956, and
that they drew upon
generation, which in
their cash
eludes World War II, the Federal«>and bank
deposits to the extent of
Government has demanded more
$1.7 billion.
credit than any other segment of
Corporations have also tapped
0U1 economy. Although the Fed- ^be capital markets
for
funds,
era
budget was - balanced last Currently they are raising a reeyear and
there is prospect :.of a ord 'amount from the sale of new
nrrl 'ammint from the sale of new
balanced budget again this fiscal
securities. Some of this money is
ment

a

our

we

reserve's.

normal

f,r«f

the

}0SS

js

plant

on

rlnrinv

0f

?mi.J?
sustained, much of this increase
95C/„
than
'
of-1956. This was 25% more than in loss reserves will be used up.

iciincci

"easy."

expansion;

sumers

year,

Purcell, senior part-

Edward

^fini'iAn

«..!•

our

Now let's t irn
to an elementary analysis of de¬
mand -and
supply forces who^e
relationship is responsible for tne

In

in

-V

.

"tight money."

plant

Threefoot

engaging

,

governments—Federal, state, and
local; business requiring loanable
funds for working capital and tor

Sargent to partnership.

Now

cn rru /->h
So much than for
then for

of

Conning Co. to Admit

i
,

reading about,

money

securities.

of the New

" ""

*

Therefore,
results

that

dQes not ouaiify for r*red f.i was -spent in the first
him,» credit is really "tight":. year. . Corporations

fact

blame

the further development of

billion

$13 Vk

■r.4Thic

would-be

a

rower

To

of

pniiinmpnt

up.

Occasionally

Securities. Mr.

OI.

business

and

+

G.

passed

However, it is historically true
a
rapid tempo of industrial,

that

-

cline

of

most

big

gov- find that they have rung up exobliged, to'defer tremely poor first-half showings,

dentof Aubrey

ner

do

better.

greater factor in stocks interest the regular run-of- rates harden'further (and the

are a

credit

and

expand;*even ment 'of ^Commerce reports
mortgage debt, in spite of a de- -corporations spent a record

from

will

Deposit.

witn

hospi-

expressways

Whether we are

;

Assistant

name

possible

this coinci-

lines

some

.

elected

Vice-P'resi

on

&

that

-

Department of

&

Surety

dence,

course
see

RateSj much as we find them at will surfer more.
In the latter
' f.blluy ?} mooey or ci edit at one
,v.
R
.
present, are going to continue for case, many indications point to
«time with availability at another
,
^Business Speikl«ig:
some
time to be inadequate for the
end of the bull market in
y— and at
all times we are meas- --- This year we have been wit- the companies in the light of gen- equities, and if these are borne
uring availability
in
terms, of a nessing record spending of funds eral
industry conditions.
out the equity holders will see.
-demand relationship as reflected-! for
capital goods by
corpoiale
A third factor that has thus far, shrinkage in their asset valuations,
in interest raies.
-..business, a condition - whicn has and, probably will continue to
The year 1957 does not look like ■'
"Tight money" does not neces- contributed major impetus to the mitigate against favorable under- a
favorable one for insurance
sarily mean that credit is unavail- high rate of business activity we writing profits, is the increasing company earnings,

associated

firm

writers,

Seaboard

7 fore. During the War, these

•-

-

Freeman/

P.

highways,

vais,
tjle

Street, New York City, have

announced

to

ant* Fixity

urgent need ftw.

for more school buildings,

ana

snip

Aubrey G. Lanston & Co. Inc., 15

Co.

multiple-line
are

that 1957 will not

.

dimensions^ of: rela- confronted with the
(1) It, M a

evident:

arc

supply; and (2);; "it time re.aaon-^ the like,
is a and a.ibetween one

ij|

Adkrov IS I ancfnvt
MUUiCy Ui LaiialUU

an

large
number
of
in the field that

units

bid

must

an

estimated

__

relationship between demand

been

to'
as

the

-

^

that

the

government

average of
about 1%
refunding money than
maturing issues cost.
It is

the
,

_

.

,

of $20 billion,

excess

.

this

Broad

picture
investor

stock

a

business encountered

coincidence of high losses in al¬
most all lines of business and the

Une thing we note immediately will be approximately $800,000,000 of "the finance companies; and the much whether the company is a
automation aiu the help about our,definition is that, tight for the year 1957.
*
•
r:
< outstanding
shares of the other high-grade bond holder-such ai?
is providing in- reaching hibney
is a condition of relatives. * State and local governments, "specialist" units are relatively St. Paul Fire & Marine, or an
At least

that

life

re¬

for

more

■

...

„

Wooten

ri.

ota

Defines Ti»ht Money

We

all help by promoting t .e ben-

can

paying

to

and

e

an

agents to pay. If, however, we approach the
against all other users to get the subject from the point of view of
funds.
As
a
result
of
"tight the insurance stock investor, for
/money," the U! S. Treasury is the greater part we will be conthe

less,

auie

terials, tools, controls and services

be

to

enough these maturing obigations release back an equal
supply of money, but neverthe-

of

ma-

have

True

e

Ihe "avaiiaoii;

to

will

by the U. S. Treasury,
counting the roll-over of 90-

not

demand

loanable

for

in-

but

consumer

dustrialists

maturities

■i

financed

funds

are

exceeding $9 billion.

In; 1957, almost $37 billion worth

a
o:

the

tx.ne

whose customers

us

the

correct

a

are

try's favor is that in 1956 the insurance

lower rates. It is of

-

bulls

This does

Examples

bearing 2%% interest will mature

projects, for culture and for sport.
not

years.

these

important

in.an amount

that

up

not at all representative of the

are

simply

-'tight mon?y'
exists.anytime

for hobbies for do-it-yoursalf

Those of

ring

in under-

many

place,

insurance

specialist

the monev market as it rolls over
from-week to week its short-term

eco¬

condition

with which

more

enjoy

going to have
ure,.

present

there

ja'rg^n,

say

is going

consumer

money

buy them and

in

first

the

we can

going to have more
things to sell to the

better

have

to

the

not

nomic

are

consumer.' The
to

will

1956

1956 showing

out in the indus-

work

These hours, and, generally, more carecompanies writings are confined essness. So the coincidence menmaturities and as it occasionally
relatively few lines, and they tioned is unlikely to lessen to any
must meet other maturing issues. are
es that are comparatively material degree.
In December, Treasury certificates-small>
certainly not comparing
Now, turning to the investment

In

,

And what has all this to do with

and

that

the worst years

One factor in the
that may

fire-casualty insurance
in the face of; the

industry point of view.

depressed conditions set in.

.

Consumer

We

connec-

without

preconceived
ideas as to what sounds reasonable,
to' find appropriate places to use
our new techniques of automation;

you?

in

continue to view matters from

Finds businessmen

Insurance Stocks

renewal

this

of

In

—

a

around

writing results in

rising hut

cease

.with

prospect

negative forces of unsold inventories and curtailed production
are not in sight;
and Federal Reserve couW be expected to

cite

look

case

must

we

and

I

would fall oft.

use

bullishness

one

to be

appears

stocks,

supply and demand

money

interest rates will

says,

credit

mean

Should

This Week

r

tion

optimistic and expect 30% increase in volume in next decade;
cost of money is more in line with cost of everything
else; and

30,T)00 commercial honey growers
in this country automation throug.i

a

advances.

stabilize, Mr. Wocten

about

are

further

some

creased and t>e labor- costs great¬
ly'reduced.

of

peaks in the first half of 1957, money will be tighter than
now, prices will be a little higher, and interest will likely make

in¬

the

prove

new

the

substantially

is

*

to

„

There

convincingly that tight money has caused
any serious trouble.to date in the economy; and hazards the
opinion that business activity and plant expansion will reach

hiye at the end of

the

Bank and Insurance Stocks

By BEN H. WOOTEN*

and there-

undertaken

Laird, Bissell & Meeds
Members

New

York

Stock

Members

American

Stock

120

BROADWAY, NEW

Exchange
Exchange

YORK 5, N. 1

Telephone: BArclay 7-3500
Teletype—NY 1-1248-49

Bell

(L. A. GibbB,

Manager Trading Dept.)

Specialists

in

Bank Stocks

24

The Commercial and Financial Chronicle

(2520)

.

.

Thursday, December 13,1956

.

The Threshold of 1957
stand

As

we

1957,

the threshold of

on

have

find the American people
enjoying the greatest prosperity

Elected

Newly

worlci

These

cri¬

National
Product

conservatively handling tremendous financing volume. Mr. Craft

indiscriminate credit injection to support a

The Gross

depression; dismisses the myth

has

reached

the

makes clear credit

$414

and

$25

is

above

1955.

to

145%

of

the

1947-1949

and the pros¬

records.

Testimony

to

the

starts

has

been

mercial

building

and

well-

in

agricultural

being of labor is the fact that
hourly wages and weekly earnings

be

arrested

posal program has tended to alle¬

in terms of

viate

ment

purchasing power are
high.
Unemploy¬

all-time

an

is

at

a

practical

the

farm

(3Vz% of the labor force) and this

adjustment

since

a

2-million addition

people employed

year ago.

To be

sure

are

a

few iso¬

lated soft spots. Residential
build¬

ing

and

been

automobile

running at

a

sales

rate 20%

have

below

ajyear ago, but the slack in resi¬
•Inaugural address by Mr. Craft before

the

Investment

America

45th

Bankers

Annual

Association of
Convention. Holly-

wood, Fla., Nov. 29, 1956.




to

dis¬

problem.

has been that

years

in

industry

after

dustry has been absorbed
general

there

seems

surplus

minimum

is in spite of

a

the

A characteristic of the economy

during recent

to the number of

income

and

momentum

little

with

in¬

the

business

of

visible

by

disruption

to the over-all forward,movement.

Perhaps
nomic
years

the

force

ous

the

of

past

equipment

sight.

for

and

new

there

eco¬

couple

plant
is

no

carry

Accompanying

prospect

of

is

that

this

into

well

and

perhaps

however, this over-all prosperity
has brought in its wake a series
of problems which require careful
handling. To some extent the boom
has been supported by a deteriora¬
tion
in
the
underlying financial
structure.

The fact that many
have been operating

forced draft while

new

orders

in¬
at

con¬

tinue to pour in, has in itself con¬

tributed to
this

decline

unhealthy situation,
a
temporary
efficiency, lower labor
an

has
in

meant

productivity, increasing costs, and
a

squeeze on

and

firms,

letup

sures,

profit margins. Some

projecting

continued

pres¬

have unwisely accumulated

excessive inventories thus leaving

a

fronts

the

community.
finance

to

NATIONWIDE

con¬

bringing

hand in hand to

assure

economic

cial

kept

pace

about

must

comes

short

Unfortunately the
saving has not
with the growth in in¬

personal

and

savings have fallen far

of

providing the funds that
recently have been sought to fi¬
nance

In

ness

to

finance

relies

ances

take

capital expansion.
to drawing

addition

ings

and
care

on

Reserve

business,

forced

System

to

have

been

liquidate government
securities in large quantities.

on

sav¬

process

the

ity ratios to a point beyond which
there

is

general reluctance to go.
supply of

Thus in the absence of a

fresh

reserves

Reserve

is

cannot

from

System,

unlikely

so

a

long

the

Federal

which
inflationary

supply
as

persist, the banking system
be

counted

source

on

as

a

limit¬

of credit.

busi¬
Private

depreciation allow¬
earnings

replacement

this

in

course

banking system has increased its
risk assets and reduced its liquid¬

less

of Securities

banks

to

factors

expansion,

retained
of

of

Of
go

smoothly
and finan¬
a

system.
of

Federal

the

We know that

investment

rate

the banking system.
a willingness by

on

banks accommodate these demands

the

of

demands

Blyth & Co.. Inc.
Underwriters and "Distributors

is

That problem is how

functioning

banks

borrowings,,; De¬

supply additional reserves to help

the

and

commercial

at

short-term

mands of this nature have brought

integrally

ruinous inflation.

saving

financing. As bond

In the absence of

problem that

without

economy

reassess¬

investment banking

economy

related to the

a

methods of

pressures

decline in sales.

But the main

un¬

The resultant rise in

quirements

themselves vulnerable in the event

Boom

through all of 1957. Paradoxically,

dustries

has.

avail¬

yields have risen, more firms have
sought to finance long-term re¬

utilizing private for public

precedented investment boom will

for

dynamic

has been the soaring capital

expenditures

in

most

The

funds

the

ment, by the corporate treasurers,
of the relative advantages of vari¬

inj 1957

automobile

exceeded

with disequilibrium fed from non-credit

com¬

dealers report considerable inter¬
est in 1957 models.
The slippage
and

Problems

up

experi¬
situation in

for

cope

Federal Reserve. Supports

taken

substantial increase in

a

interest rates has caused

on

a

been

is

able supply.

available

dential

po¬

being

the harnllessness of gradual inflation;

participation in capital outflow.

by

have

demand

the

are

fdf*

■

we,

substantially

and suggests Aldrich Commission typo study to determine adequacy
to

instances

recently

which

boom is surest road to eventual

of tools

The

pect is that it will go higher be¬
fore the year is out.
Disposable
personal
income is setting new

at

encing

Reserve Board index has

level of production

have

working capital

some

impaired.

double

the figure of a
deca h
f» a o

billion

Federal

risen

Craft

and

sitions in

avers

sources;

billion;

this
H.

dividends

when

to

as

policy cannot

annual rate of

Robert

dwindle

paradoxical accompanying

What

role in

measuring rod
you choose to
use.

to

and emphasizes investment bankers'

problems requiring careful handling,

other

or

a

time

a

steadily
climbing.
Hence
retained earnings have begun to

predicting unprecedented investment boom's prospect continuing into 1957,

newly elected IBA President calls attention

by almost any
terion

caused

Chase Bank, New York City

been

In

facts

statistical

costs

at

supported

are

fallen

ment

of America

has

known.

ever

President, Investment Bankers Association

President, The

and the highest standard of living
trie

depreciation allowances
below rising replace¬
and
competition has
levelling off of profits

Recently

ROBERT II. CRAFT*

By

we

to

needs.

A

Debt

concomitant

satisfactory

Increase

of

a

less

than

accumulation of say-

ings

of

in

the

debt

.

.

The Commercial and Financial Chronicle

.

been the enormous in¬
private debt particularly

has

crease

Number 5594

184

Volume

mortgage

and

consumer

Over-all
con¬
at a new revised

categories.
is

debt

sumer

all-time

level

of

high

five-fold

billion—a

$40

the

from

increase
the

of

low

1946

postwar

Individual

debt

totals

$200 billion.

over

is

rate

debt

debt

today

the

year.

in

aggregate

If corpo¬
net private

added,

the formi¬
dable figure of $400 billion, com¬
pared with only $140 billion just
at

stands

(2521)

ployment,« and profits.
This of
gradual coarse "warsachieved against the
of say background of less than a 2%
the
2% a year is harmless, is likewise fluctuationin
price
level.
the -conditions
we
a
myth for it is by this process, Those -are
as
President Eisenhower pointed should strive to preserve but right
we
are
out in a recent press conference, now
up
against strong
that a gradual erosion of purchas¬ pressures on the price level and

and

type

suffers.

in

the

end

The thesis that

everyone

a

inflation of the magnitude

-

ing
to

power

save.

destroys the incentive

In the absence of proper

capital formation the Government
it politically inexpedient to
avoid the creation of money. Thus

finds

only
and
in

a combination of appro¬
fiscal,- debt management
policies. Beyond this,

by

priate

credit

the

private sector, there must

be intelligent cooperation between
labor and management and exer¬
cise
the

of

restraint

individual.

on

the

Excesses

of

part
in

any

or

out¬

to counteract these it is necessary

one

to

side the Government call for ap¬

employ strong antidotes.
What Credit Controls Can Do
Let

me

make

clear that credit

category either within

plication of moderating actions in
whatever other categories can be
employed.

result
is policy is no cure-all for economic
Fiscal Advice
ten years ago.
brought about.
The best back¬ disequilibrium pr price instability.
Much has been
accomplished
As indicated, the overwhelming ground for rising
business, full If properly used, credit controls
can
be effective in arresting in¬ during the past several years on
proportion of this debt involves employment, and a higher stand¬
the fiscal front.
A Federal Gov¬
which
arises
of living
primarily
fixed time payments, a fact which ard
is a stable price flation
ernment budget surplus is a wel¬
reminds us that any natural de¬ structure. I think we can find no from extension of credit, but it
come change from the heavy def¬
can
no
more-stop inflation that
cline in economic activity might better example of this than the
icits of the past but certainly the
tend
to
become
cumulative be¬ experience of the four years up to arises from other sources than a
present surplus is at a very mod¬
cause
of the nature of the debt the
beginning of 1956—a period lightning rod can put out a fire. est level in relation to over-all
structure.
These

/

•

t

should be

we

it is in this

:
of the problems

.

some

are

of which

of

the

same

almost continually

ness '

activity,

stock

maximum

rising busi¬

The

prices,

achieved

em-

on

effect-•

bet

can

the Government front

income, and if no further progress
than this can be made during a

period of unparalleled prosperity
there is little prospect of ever
making a really significant inroad
the

on

much

national

larger

debt.

surplus

the

serious

more

reductions

that

would

not

solely

rather

avoid demands for wage increases
are
out of line with pro¬

ductivity.
In

fact

ual

borrower
or

consumer

of the free world

The

today.

do

international

the

on

in world

Continued

The FIRST

affairs

be

best

can

sup¬

NATIONAL

ported by a stable currency and ;
healthy economy at home.
From 1951 up to the latter part
of

last

CITY BANK

this

in

country
remark¬
able degree of stability in prices.
we

year

ofNew York

succeeded in achieving a
In

fact, during all of, this period
varied less than 2%.
But
just since January of this year
pressures have mounted with the

■

prices

result that

than

more

one-half of

t-4

the increase in he Gross National
Product this year is

by

that

of

of

stead

and

rise

State and

in¬

dollar

fur¬

we go

for

allowance

make

population

2Vz%
the

When

figures indicate.
ther

that

5%

rate

real

less than

the

This

prices.

actual

our

is

growth

accounted for

in

increase

an

means

the

of about 2% we
capita Gross
has
changed

find that the real per

mm

scarcely at all.
Against Indiscriminate

the

circumstances

these

Given

Reserve

alternative

no

■

a

Municipal

Credit

Injections

Federal

■

Product

National

System

but

had

has

restrict

to

the

availability of credit to accommo¬

only the

dating

business.

of

of business

in

long

not being met out

savings, it is axiomatic that

of true

the

legitimate needs
as demands

As
are

additional

of

creation

money

results in an im¬
parity simply results in an in¬
crease
in
prices. Indiscriminate
injection of credit i to support a
an

economy

boom

the

is

eventual

-

surest »road

depression,

f•

to

and-

an

Municipal Bond

the

longer the boom is continued by
this

means

the

more

severe

the
■

inevitable collapse.

«*»'?.-

Department

Exposes Inflation Myth
-Let

us

fallacies

that

said
im

not fall for

of

the

common

inflation.- Often

inflation

means

a

it

is

TELETYPE NY 1-708

rise

profits, in stock
creased employment,
wages.
and

prices, in¬
and higher
The history of the French

iM

German inflations furnish in¬

controvertible evidence that these
are

iHead Office:
55 Wall

Street, New York

purely temporary phenomena
in the longer run business

—that
after

business

is

down because of

forced

to

close

inability to raise

prices and generate earnings fast
enough to meet the more rapidly
of operation.
Inevi¬
this brings
about
bank¬
ruptcies rather than rising profits,
lower
rather
than
higher ' real

rising

fr.
k

\

75 Branches in
Greater New York

costs

tably

and unemployment instead
of increased employment. Terrible
hardship is wrought on the pen¬

wages,

sioner, insurance policy holder,
savings bank depositor, and any¬
one

depending

Actually

hedge

no

against

upon
one

fixed income.

can

effectively

inflation




of

that

exercise

voluntarily, the Federal
Reserve
System: finds itself in
that generally unpopular position
of bearing, the responsibility for
forcing restraint by limiting the

all

scene

not

restraint

tinued tension in the Middle East
and

lender,

other agencies of

con¬

generally adds additional fuel to
the inflationary fires.
Leadership

,

or

labor, the individ¬

or

the, Government

of trou¬

confronts

that

*

[
if

management

domestic problem

a

one

the

which

foregoing factorsj
are
contributing is the threat of
another inflationary outburst. This
but

have

effect of reducing revenues. It is
the
responsibility
of
labor
to

ble to which the

is

debt,

Congress should scrupulously
expenditures and avoid tax

most likely

source

a

provided

prune

originate.
A

Until

is

for reduction of the Federal

of debt and credit

area

that future upsets are
to

for

aware

eventually

25

Member Federal Deposit Insurance Corporation

on

page

65

f](3

The Commercial and Financial Chronicle

(2522)

...

Thursday, December 13,1955

.

Raising Our Performance Level
First let

extend my

me

By GEORGE \\. DAVIS*

personal

greetings to all delegates to th^
our

The opening

guests.

garding industries, states, munici¬
palities, etc., may be purchased

of America

President, Investment Bankers Association

Retiring

Convention, to your wives and to

^

lrom

Partner, Davis, Skaggs & Co., San Francisco

of this

Convention

t-

s

Retiring IB A head asserts "Accent

Bankers

*nent

A

ve s

of the investment

sociation

and informed

here at Holly¬

Youth'' is the

on

industry and reviews the

selling, to

the taking

encourage

sion

which

at

report

we may

to

and

you

concerning the
progress and

ciation

»nd

George

d

a n

here

also

olcl

I'm

W.

Davis

renew

our

friendships

make many

to

sure

to

valued

and

new

"Hollywood," coming right after
— and Thanksgiving

Thanksgiving

^coming close

the heels of Nov:

on

and recent developments abroad,
that

means

have been to the

foregather

we

here

behind

now

1956,

number

and

no

submitted to the Municipal Forum

board

yesterday afternoon and copies of
which are available; to you.

which

legislative front,

was

enacted in the

changed

any

curities

acts

of

the

under

Federal

se¬

which

our

There
were,
however, a number of proposed
changes
which reached various
stages in the legislative process,
as

bright

operates.

the Bennett Bills, the Ful-

Bill,

and the Priest

Bill;

by Mr. Davis before the
45th
Annual
Convention.
Investment
bankers Association of America,
Holly¬
*An

wood,

address

Fla.,

Nov.

25.

covered

the

At

the

adopted
and

State

a new

the

level

Virginia

State blue sky law.

Harvard

Law

Study, looking toward the
of

opment
or

laws

are

agreed to discuss with

IBA's,

Street

model acts

of

direct

These

us.

in¬

will

be

the

in.

report of the
Legislation Committee

will
on

I,

of

matters

be

made

the

to

Friday. The
personally, am

larly interested and

ter
am

model

of

on

new

in

one

particu¬
which we

Summary

a

this

sure

worked

Prospectus.
I
problem can be

and when

out,

Certain that such
be

a

ject of much discussion during the

tors

coming

a

it is I

document

am

will

great help not only to inves¬

well.

year

Legislatures

as

most of the State

will

These matters

be

in

session.

plus the latest de¬

with

respect

the

to

a

tributed

to

who

not

but

retail

to

distributors

as

and

their

first

hand,

developed between the Investment

really need

Association of New

IBA.

only to fprtify them in

a

Training
No

work

of

Younger
of

this

dealer

and

to

his

various

Every

i

n

d

u s

tional

t r y

the

tees

knows that
particularly in the cor¬
field, must be taught to sell
perimeter basis: an ind.us-

summaries,

its

own

group

subjects

same

factual

in

material

membership

simultaneously

pvHfm company

in

with

Continued

and

New

its
on

i.';J

philadelpw x
allen town

lancaster
scranton
york

chicago
chicago heights

minneapolis

boston

winston-salba
charlotte

; »v e V

/

*

*

*

durham

oififjcies

*20

Broadway, New Yorik 5, Ml. Y»

raleigh
,

*55?

»

vu

'

atlantic city

.

east orange

•

h

morristoWm "

"
'*

pidgewood

vinelatyd

.

c'armel

►

•

—

,

san francisco
berkeley
■"

v

titers

y

.

.

•

.*•

oakland

i\t,

i"

*•"
.

titers and Distributors of State,

j>acr am en tosalinas

san mateo f -.

and Revenue Bonds

11
'

santa cruz.'- 4

-y

santa rosa

'•

'

:

"i

■

■

1

■:

s.ockton

Primary Markets in Many Unlisted Securities

,•

-

Correspondents hz:.
alexandria
buffalo

Brokers in Securities and Commodities

""

'

chicago
denver

pes MOtNES

Investment Advisory Service

detroit

indianapolis

■

•

kansa5 ci ty
lincoln

Members New York Stock

Exchange, American Stock Exchange,

miami
.

'•

to

sug¬

omaha

-

-

pittsburgh

.

st. louis
'

v'

sioux city

toronto '

•

.'f

York

page

.av-v

syracuse

main

to

release

mew york

rochester

.

—

and

brooklyn
v

na¬

print committee information to

their

second. .Although information re¬

or

coopr

our

Chairmen,

gestions for reports thereon. They
also agreed to release
verbally and

sales-manager

n-

the

Through

of

one

Committee

the

submit

committees.

trv

every

within

study

our

delegates will

of

IBA

in

men

York.

assistance and

the counterparts

men.

porate

New

this New York organidation set
up
of IBA Commit¬

is

than

salesmen

younger

in

eration

smaller

industry studies made bv

the

the personal

People
the

of

business

of

Association

to

York and the
Investment Association
York is a group of some

The

New

.400

give

to

understanding
of'this nation.

important

more

also

but

better'

the economy

new

this Convention you

not

clientele,

them

on

men

these

selling efforts and in build¬

a

the

attend

to

vvhat can and has been done
along,
•these lines is the close
relationship

salesmen

background material: infor¬

mation

ing

able

Those

meetings.
'such

,

During the morning sessions of

hear, at

are

young

your

,'t:




I

in the

men

Clubs,

Offices in:

&

ago

of

need

this

have been working with the Com¬
mission for some time is the mat¬

devel¬

blue sky law
completed.
These
will likely be the sub¬

a

which

School

was

velopments

19S*».

problem

under consideration

all

temperate po¬

legislation

jjuch

to

it is here climatically.

last session of the Congress which

business

terest

Federal

are

in

of

report of the Municipal
Securities Committee which was

in

all

or

discussed

On the Federal

year

Youth."

.

comment

Highway Act of
amendments
to
the
detail

as

the

a

on

—

the. Federal-Aid

matters

is

here

my

and
in
anticipation of making
Group calls around the country I

IBA

public and to the investment industry.

annuities

variable

Water Pollution Contfol Act. These

as

recall

30-40

the election

,great country and can continue to
live and do business in an atmos¬

phere which

made

to

»

will

you

age groups, sales
techniques
year's Committee reports on and
methods of interest to them.
us I have no doubt but what they
covered in detail in the report of a great variety of Industries and
Furthermore, I wanted to encour¬
and perhaps other issues will, be the State Legislation
Committee other subjects, as indicated in your
age younger men to know their
revived and provide further work which will be submitted to you on
Convention program. This infor¬
industries through making use of
for our special committees dealing Thursday.
mation is essential; to |haking thei
IBA Committee reports, and there¬
Convention helpful to you.
with these matters.
The SEC is continuing its pro¬
Ac¬
by building a sound foundation for
In the municipal
field several gram of reconsidering and revis¬ tually, however, I would suggest
.their sales efforts,
w
measures
affecting the business ing various of its forms, rules,- that it is even more? important
One outstanding e xample of
were enacted into law
notably etc., and now has either out for that this same information be dis¬

and with

truly thankful that we live in this

litically

no

bringing*
younger men along, teaching them
the art of
selling, preparing them
to
accept
larger responsibilities;

junior

ones.

(■>

referred

the, IBA and

and shows how beneficial

in various cities;

men

of

concerning "Accent

IBA Committee industry studies to the smaller dealer and

younger

Many

comments

Mr. Davis explains the impor¬

one.

reviews closer relationship developed between

educational activities

industry.
are

many

highly respected

Asso¬

our

We

of

groups

prospects both

N»ur

many

to-salesmen;

discuss details

of;

of the

tance

a

services,

given the young
put before him

cialists in their fields.

of responsibility, and to

on

to

spe-'

proper

—

make the profession

occa¬

designed to foster

program

wood marks
another

to a great need

answer

be

than

the findings and conclusions of 15
to
20 'IBA
Committeemen from
within his own business—all

of

i;he

In

statistical
can

salesman

Annual

45th

the

finer aid

-

U

62

Volume

Number

184

5594

.

The Commercial -and Financial Chronicle

.

.

(2523)

27

Meeting the Nation's Steel Needs
I

here not

am

as

the spokesman

By A. B. HOMER*

for

;

for the steel industry as such, but
the

as

President

Steel Co—a
'

I
■'

may

with

c ue

which is, if

company

it

say

\

Bethlehem

o:"

..

In

mod-

/ J esty but with"
great

.

pride,

a

industry.What

*,

I

v

■t

•'

•

•

'

'

:V:v:,•

■

i

cf

to v

\\

by 1971* to provide 200 million ingbt tons, and in

million tons,

1958.

the

B

t h 1

e

hem

e

Will
v

>

probably
apply in some
degree to -all
the other

;

v

lems

in

mon

ton spread oyer all

amortization to avert

ma¬

Decries self

prob¬
com¬

and

per

relatively sm^ll increase in

Arthur

B.

defeating wage-price spiral and praises recently

tax

we

approaching solutions to those
problems in the same general diI

Balance

A

Wc

think

are

Gains

of

getting

interests

reali¬

to

nearer

the

of

the

whole

difficult

most

is

of

one

functions

jot

generally recog¬
part of all interests
nized today that the managers of tnat a proper balance of gains is
large industrial companies have to vgooj for all and that excessive
keep in mind continually the in¬ gain for immediate benefit to ~nv
terests of employees, customers,
one
interest is bad for all.
The
stockholders

.

management today.
The nature of this management

year.

it

large. .The
ment

is

zation

and

art

of

the

country

good

might be defined

as

at

on

tne

professional

manage¬

business

modern

all interests in

sees

clearly that servihg
an equitable man¬
major goal'towards which

ticing of methods which will sat¬
isfactorily discharge these respon¬

ner

is

he

stri f js

sibilities in the face of such

.

of

manager

the

orac-

whole.

ing conflicts
It

is

have
in

as

been

dealing

may

that

we

making great progress
with these occasional

V." conflicts in the steel industry and
that the interests of all groups are

being

better

served

today

than

it

is

in

1

An

ment

Fla.,

address

Annual

by M. Homer before the
Convention
of
the
Invest¬

Bankers

Nov.

27,

Association,

Hollywood.

1956.




the

good

of

ihe

beeri accomplished,

difficult
the

of

our

times

at

conflicts

to

resolve

which

arise

competitive economy where
be used to force a gain

power may

for the

may
45th

for

goal may have
seme

To

benefit of

lead

to

one

interest and

conditions

which

be

can

well

illustrated

by reference to the steel labor

anticipate and contend with
will

not

so

that the end

adversely

affect

ne¬

gotiations
a

which took place this
These negotiations produced

crisis for the

industry and cul*costly strike, the ef¬
which are Still being felt

minated in
fects

of

a

throughout the

economy.

problem

Later I

we

faced,

but first let me put it into the
framework of the industry's over¬
all

years,

to

of

not

may

be

what

keep abreast

precise

of

of

the

job

vestment.

and

sibility

Here

to

interests

is

steel

growing.

Our whole economy is
surging forward and the steel in¬
dustry wants to keep pace. Mani¬
festly, it does not want to retard
this

growth

by not prop¬
el ucing enough of the basic mate¬
rial upon which growth depends.
History indicates that the pro¬
duction
has

of

process

steel

direct

a

in

our

economy

relationship

to

our

gross national product—the meas¬
ure

of all

cuced.

goods and services

If

the

trends

pro-

have

things.

naturally are'conccrned about

we

the

at

have

another

about

previously.

consumption

some

we

the

a

I

have

in¬

respon¬

of

one

<whicn

stfme

satis¬

a

I

"

capita

spend

capacity.

new

the

spoke

*

no

to

Investors

doubt

that

you

are

generally familiar wita the situa¬
tion.
With
today's facility costs
inflated in relation to the
average
of existing
plant, tie indus¬
try is running out of opportunities
to add additional
capacity at costs

cost

which

would

ment

us

others

all of
will

present

of

Some

than

justify the invest¬
earning levels.

at

in

are

in

who are

us

be faced

better

this

shape

regard,

but

going to expand

sooner

or

later

with

of

growth the necessity of adding new fully
production, integrated facilities
from raw
in population and. in per capita
materials to finished products—-at
consumption of steel, the economy costs ranging to
$300/$400 per ton
would probably require in 15 years annual
ingot capacity.
To illus¬
continue

in

national

—

problem.

Responsibility
Let
ment

to

that

the

American

dustry must expand
That

is

the

start eff with

me

pacity to

be detrimental to all.

such situations

sult

challenge

will outline the

thereby

before.

ever

a

While partial realization o" this

arise.

observation

my

seem¬

tons

Responsibility

rections.

five

need

indicate

to

doing

are

-

estimate

continuing to earn
factory rate of return on

three-year

won

through

year

next

will

figures

they
do

to

the

rate

a

additional

time

stabilized-labor-cost period.

Homer

20. million

We

reduced expansion plans.

or

facing.

$5 billion to create

over

but

learn¬

products," and reinstatement of accelerated
high price increases

even

is

million
a

of the

one

authorities

industry

These

adequate V
.

ings

jor producers.
We have

-Mr. Homer suggests "a

Investment return.

*

Some

.

well

financing problems entailed in view
to maintain

five

that, within

.an

increase,

rate

.

,:

about

ingot tons of steel

-v

or

next five years

annual ton

discrepancy between increased capacity posts'and need

is
industry

purposes,

the

Expansion is proceeding at
of

v

to increase steel capacity 70

Bethlehem Steel bead details the difficult

•

yr.i_t.hV

say

trdf drerice

.

additional 20 million ton capacity to f ive million

the

:

;

.

forecasting steel industry's-need

50 %>

considerable
factor* in

v

■

'

,

.

security

problems

President Bethlehem Steel Company

serve
our

Nation
the state¬

200

its basic

ca¬

mean

the nation's needs.

responsibility

country

the

population is growing and

a

whole.

annual

in¬

re¬

as

an

steel

to

the

The national
our per

stetl

million

million

pacity

capacity

ingot tons.

expansion

an

tons,

in

the

next

about

50%

over

or

of about

This would

of

15

881
1

including

1
'

a

ca¬

years.

;Td exto meet t^e

needs,

in

the

implications of this jet

cite Bethelehem's

uation

as

an

current

sit¬

example.

.Current

price-cost relationships
provided Bethlehem with earnings

nation's

safe

"■

trate
me

7#

in

1955

which

resulted

Continued

margin

in

on

the

paqe

re-

58

$P*Sii W&ti

I

fr*,

#*2

Dynamic Growth necessitates

i

i
>■*"

New-Municipal Services
'in

California the Bank of America is foremost
in School and other

Municipal Financing

ISmtk of America
NATIONAL

JAVM

Nos

MUNICIPAL BOND
San

STATE

ASSOCIATION
DEPARTMENT

Francisco, Calllornia;
AND

MUNICIPAL

•Undvrwfihfn and.
Diitr.bj'Ori

Jt

/

'

BONDS

Specializing in the General Obligations of the State
of CaTifo'nia and its political

st

fcdivisions
".

fX'A

1

:

j
.

? f:

-

-

<

i

28

(2524)

The Commercial and Financial Chronicle

Kaiser Industries
When

George Davis and Eaton
Taylor invited me to make a pres¬
entation

"What

to

do

I

you,

asked

want

you

them,

They
"Kaiser

Industries."

replied,
you

sure

I

out-look

and

the

ical

talk

E.

Ti-frfethen,

confidence, stresses all

business." Reports
(2)

oxygen

in

West's growing steel

the future that developed
foundations
of
our
basic

businesses.

Historical

dams

tion

in

There

was

when bids
build

to

without

the

start

business
In

of

in

1927,

our

sand

1923
and

California.

we

went

to

great

a

were

address

45th

vestment

of

by

Annual

Bankers

with

gravel

.

even

we

made

having

a
a

one—

cement

savings to

were

$1V2 million.

awarded

the

ica, Hollywood,

This

effort

has

been

involving

than

more

a

billion

one

two

and

in
seven
months .had
built
plant, started operations, and
begun delivering cement.
CK

the

This

was

ing, and I
the

followed by shipbuild¬
am

sure

shipbuilding

you

all

record

know

during

than

aggregate

for

$420

little

a

more

million.— incidentally,

information,

your

Kaiser

In

a

than

for

which

to

started prior to World War II and

of

capsule,

Today

Fla., Nov. 28, 1956.

-

Kaiser

J.

Its

operating

the

largest

San

to

now

after

more

billion; totai sales of
billion annually; 69,000

stockholders; 51,000 employees, 88
plants and facilities in 14 states
and

10 foreign

tion, through

countries. In addi¬
charitable trusts

our

and

non-profit corporations com¬
prising "The Kaiser Foundation

12

Plan,"

hospitals

treatment

a

very

we

and

are

34

centers and

Kaiser

of

almost

operating

in the

important

Kaiser

part

Kaiser

school

tion

is,

totalling

some

500

con¬

of
are

the Chalmette works of Kaiser

our

num," cement and gypsum...

with

Kaiser Engineers today is tack-,

have
the

successfully

passenger

exclusively

to

market-

for

the

related

4-

geared

the

specialized

Willys Jeep

and

2-wheel

I

say

Kaiser
to

you

words

just used—"successfully retired

from

the

—are

an

come

through those terrific losses

—paid
the

some

Co.

car

business"

all

bills—and

our

Steel

tion
.

little

a

profitable

one

was

undertaking.

;

This shift has resulted in profit¬
able

operations

in

Willys

1955 and in this year

.

.

.

..

.

.

in

the

MUNICIPAL

Iron
.

.

Atomic

the

.

.

.

.

in

.

the

.

.

addition

tracts for

to

our

performing

own

con¬

associated

com¬

panies.
I wish I had the time to tell
you
more

of what

how

will

the

raise

they
Tata

India's

nage by almost
exciting
work

Kaiser

are

doing

contract

total

50%

...

Continued

NEW YORK




PUBLIC

FOREIGN

TRADING

of

Wertheim & Co.
Members New York Stock

NEW

YORK

Exchange

the

by
of

page

73

SECURITIES

CHICAGO

.

field

UTILITY,

DEPARTMENT

.

ton¬

done

the
on

.

alone

steel

being

Engineers in
v

RAILROAD,

UNLISTED

and

Company of India
."
the
& Laughlin Steel Corpora¬
St. Joseph Lead Company
Marquette Cement Company

1956. And

AND

?;

engaged

Tata

Members New York Stock
Exchange

INDUSTRIAL,

-

of Kaiser

men

currently

are

of

•;

Energy Commis¬
Snowy Mountains
Hydroelectric Authority in Aus¬
tralia
and many other clients
.

of

to

contracts

volume

...

.

sion

turned

business, by the acquisition of

Willys,

&

passenger

understatement. To have

of

dollar

Jones

and

here, he

were

more than $400
representing the

portion

for

work

drive

that the

this

total

a

Engineers
in

.

Edgar

would

.

Twelve thousand

.

Vlf

.

about $700 million.

business

now

.

uncompleted

retired

car

Willys Motors is

backlog of

a

million

'

.

.

part

tinue t© offer to industry at large
their varied skills and experience.

there¬

V

.

the

to

played
by these men in our own develop-*
ment, they have offered and con¬

vehicles.

Beau, Stearns

our

Kaiser

a

construction of the country's
largest aluminum reduction plant

...

ling

We

and

and

engineering artd con¬
business, our sand and
gravel business, our Jeep business
plus our interests in steel, alumi¬

of

integral

entire history, the
Engineers have
prominent part, from
operations to the design

of

played
paving

top

our

effect

Willys Motors

an

undertakings.

men

cor¬

wholly-owned
In

Engineers

be

to

During

struction

apd

partnerships

trial

after^ Kaiser Industries, Corpora¬

from,

doctors

Gypsum.

engi¬

organi¬

Engineers has been and

continues

Chemical and 30% of Permanente

nursing. This vast organization of

with

century of

its

in¬

Bay

largest

construction

Company owns 80%
of
Kaiser' Aluminum.
In addition
Steel, 37% of Kaiser Aluminum &
•

divisions

decisive factor in the development
and growth of all Kaiser indus¬

and Willys Motors, Inc., and
through
the
Henry
J.
Kaiser

and

Company

Francisco

world's

Kaiser

coun¬

pany

outpatient
a

the

comprehensive

development. It is

Cement

an

zations.

Industries

half

a

of

neering and

Health

Returning to Kaiser Industries
Corporation—it is the culmination

4,300 technicians and aids in

junction

1948.

$1

close to $1

followed by our other basicindustries—Kaiser Steel in 1942—
Kaiser Aluminum in 1946
and
—

is

is

producer of sand
Kaiser Engineers,

gravel and

one

effort.

our

It

vital—supplier f of

other

tions.

company which owns all of the
stock of the Henry J. Kaiser Com¬

■

years, Kaiser Industries
Corporation and its affiliated com¬
panies today have total assets of

Kaiser Gypsum in

Amer¬

program

Willys

knowledge,

our

most

care

It

try.
of

530.000

over

the

porate

40

Health

war."

It is important to note
however,
that cement like sand and

is

medical

great

financing

of

Plan members. To

this

fifty
million
dollars.
today, our current expansion

programs

close

contract

gravel,

Cuba

Mr. Trefethen before
Convention of the In¬
Association

(3) plans of fully

needs

Kaiser

.

.

wholly-owned 'sub¬
sidiary, Henry J. Kaiser Company,
is an operating company as well
as the principal stockholder in our
major
publicly-owned
corpora¬

hundred

called for cement

Shasta,

was

"An

the

team

shortage of
Coast, and

West

plant—one that meant

our

in

Our

Area's

tal

.

I

as

'•

{

forgings for
B-52 and jet-tanker
!

.Boeing

Henry

par¬

caring for the medical and hospi¬

pri¬

—

all financing has been arranged.

the

on

expansion

marily in aluminum, steel, cement,
engineering
and
con¬

gypsum,
struction.

—

1939.

cement

We

Highlights

followed

Western

great

of

.

Ltd. to conduct paving operations.
was

the

of

Shasta

triggered our
entry into basic materials produc¬
—

the government of

Henry Kaiser's industrial be*
ginnings date back to 1914 when,
in British Columbia, he organized
the
Henry J. Kaiser Company,
This

period

our

Even

Kaiser

sound

various

the

,

The past decade has really been

we

Another

story of

billion.

.

.

country.
;

clude

of $1

excess

V

f

aluminum

and

industries

Industries,
which is so close to my heart, is
the story of our founder, our in¬
spiration, our Chairman, Henry J.
Kaiser, and of the team, of men
he built. It is a story of courage,
vision, inspiration, hard work, and
the

machined

demands; and (4) getting ready for annual aluminum
sales in

success.

faith in

shop in - the
important—a

re¬

than present 55% of

more

military

Aireraft" & Electronics

profitable expectations for

converter process and nuclear energy;

build 200 miles of highway, laced
are
in
are
where
large by 500 bridges.
In 1931, heavy construction be¬
sums of money are as essential- as
the
raw
materials, plants, and came our major business. In part¬
management. You
have become nership with other contractors we
partners of ours and we are grate¬ built some of this country's big¬
ful for your confidence and for gest
projects — Hoover — Bonne¬
your
great
contribution to our ville—and the Grand Coulee Dam.
The

greater,

vehicles,

operates the largest profile milling

The

future.

our

industries

basic

(1

on:

important and unique role of Kaiser Engineers,

integrated West coast steel operations to meet

to speak to you gives us an op¬
portunity to tell you how impor¬
tant
your
part has been in our

growth

borrowings have been

government

?

S.

broad and diversified

a

as .export. ,-V ,>• ~
Through a subsidiary

states

a

largest U.

well

appreciation for invest¬

expresses

third

commercial

of

enjoy

forward
to
in 1957.

year

market—domestic and

Jr.

Kaiser Industries." This invitation

and

bankers

ticularly in
E.

you

about

growth,

and

Corporation—comprising steel, aluminum,

foreign countries—Mr. Trefethen

Willys in 1957;

are

want

we

of the Kaiser Industries

passenger car

about
we

the

are

programs.

going?"
And
they said, "No,
to

We

paid in full with interest, and reiterates"we have successfully retired from the

philoso-

where

10

ment

theoret¬

phy

we
are
looking
particularly good

Corporation

for

edonomy
of the country
a

Industries

engineering and construction, cement, sand and gravel, in 14

gypsum,

me

the

or

Kaiser

describing the growth, structure, financing, balance sheet and operating

statement

you

discuss

to

In

"Are

don't want

TREFETHEN, Jr.*

Vice-President,

exporter

about?"

said,

E.

talk

to

me

Thursday,December 13, 1956

.

Corporation in Depth

By E.
Executive

.

.

Volume

5594

Number

184

The Commercial and Financial Chronicle

.

.

.

(2525)

29

SEC's Impact on Capital Markets
It

is

the

*

revocation

representation

As each of you

in

Focusing attention

daily

your

directly

tration

unscrupulous sales, and emphasizes

Federal

rities
the

that

the

of

secu¬

laws

discusses such

problems

by

Securities

responsibilities of

common

this

opportu¬

with

the

you

statutory
J. Sinclair Armstrong

the

importance

our

free

the

to

of

enterprise system of the
of the capital
contribute

should

understanding

the

of

to

the

an

respective

responsibilities in the capital
of

mar¬

the

Commission,

se¬

curities

industry and the investor.
objectives of the Con¬
expressed in the statutes, the
Federal securities laws, enacted in
the years 1933 through 1940, were
intended to provide to public in¬
As to the

gress

vestors in

securities*' offered
terstate

curities

traded

and

exchanges - certain

1

se—*

basic

business and financial information

,

.

,

,

..

,

importantly, that

Rather

years.

to

statute

the

We still

effective.

and

be

are.

4

more

ties

which

trusted

provide

to

lation, of

;

a limited regu¬
over-the-counter

the

plification

physical

integra¬
regulation of
the financial structures of public
utility holding company systems;
to provide regulation of invest¬
ment companies to assure adher¬
tion

and

continued

and

,

Capital

formation

is

,

tremen¬

dously important to the economy
of

our

nor

I will debriefly, and
with them.

to cope

Problem ;of Dishonest

in the Federal securities laws de-

the

,':-;

problern

of

new,

in-

public

investors,

protective

and

of

provide

to

against manipulation, "pools," rig¬
ging of prices, insider advantages,
and
misrepresentation and fraud
in

the

rities.

purchase and sale of secu¬
These are the statutory ob¬

jectives.
As

to

These last three years have been

mission

curities

laws,

it

was

three

years

in December, 1953, that Ralph
H. Demmler, then Chairman, ad¬
dressed your Association here in

ago,

Hollywood.
some

productive
many

work.

of great progress in
areas of the Commission s
The securities industry and

Government

forts

the

of

He

outlined

problems

Commission and described

to

An

acid

45th

vestment

ica,

less

by Mr.

Annual

you

our

ap¬

He stated,

Bankers

Armstrong

Convention
Association

of

before

the

of

Hollywood, Florida, Nov. 26th.

of

three

profit
tablishment

the

probago

years

...

reputation
upon
of

rather
of

,

a

their
been

put

.

quired to be filed with, and is

.

jjon

fraud

0f

,

such

in

sales

difficult

«ar*iminriv

media have rendered great
service to the American people by
helping to get this message across,
But, fundamentally, a government
agency can do just so much in
protecting the public, and in the
final anlaysis the American people

has
task

and

learn to use ordinary care
prudence

money.

in investing their
Commission needs

been a Particularly difficult task
necessitating the careful collection

me nelP 01 tne investing puonc

widely scattered

which should report to us trans-

has three thrusts

tion and fraud has occuried and
Continued, on page 55

business
...

of evidence from

y

The

a

actions

.

built painstakingly sources.

just and equitable principles
substantial

first,

A

.

news

Prevention and detec- must

strangers.

Our

trade.

number

program

to

broker-dealer

bring

investing

in

which

oublic

misrepresenta-

present formidable ob¬

then

seemed

have

been

remote,

solved

but

are

or

on

which
their

to solution.

way

In

approaching problems, natu¬

between

the

securities

In¬

Amer¬

Commission

and

the

and

between

different segments of the

industry,

as

to

industry,

administrative

of

and conduct.
common

the

methods

business

But

we

Commission

or

Underwriters and Dealers

and

practices

all share one

interest, the

investor.

the

If

BONDS

CORPORATE

securities

COMMON AND PREFERRED STOCKS

AUTHORITY BONDS

STATE, MUNICIPAL AND "NEW HOUSING

TOLL ROAD AND OTHER REVENUE

BONDS

Clark, Dodge & Co.
ESTABLISHED

1845

Members Ke-ee York Stock /{.v.-

■

61 WALL STREET, NEW

NEWARK.




han^e

Eastman Dillon, Union Securities & Co.

YORK

MKMBKRS

EXCHANGE

YORK STOCK

M-:\V

LONDON

15

BROAD STREET. NEW YORK 5, N. Y.

•

CHICAGO

PHILADELPHIA

HARTFORD

BUFFALO

CARLISLE

.BALTIMORE

LOS ANGELES

•

CLEVELAND

•

.

SOUTHERN

•

READING

•

PINES

•

BOSTON

EASTON

PATERSON

•

LAS VEGAS

•

-

N

.
,

'

.

Correspondentr
CHICAGO
NORFOLK

ST.

ex-

es-

the

sound

calling to
letter in the mail about the

amihed by, the Commission) in
rooms." An increasing number of the. mail.
securities
of speculative
quality
The press, radio, and television

cus-

the hope of

...

a

Second, the problem of "boiler-

drawn

than

called will

stacles and the resolution of which

procedures
*

the

some

which

to

have

into the business in

great sat-

cooperative ef-

owed

Some

person

rally differences of opinion occur

for

facing the

proach and philosophy.

our

solve

to

lems

take

may

isfaction from

tomers.

per-

asked to tell the person

«

obligations

unknown

only buy the stock. The public is

tions.

perienced and unfamiliar with the

without willing investors.

with

of riches if the

caP,tal m a r k e t s has attracted bave been soid to unsophisticated
™any new brokers and dealers to investors lured by representations
IPe securities business. The num- of iarge profits under present
ber
aAn1tF" ?n^f market conditions and willing to
the public confidence in the m-^!nci^nn
buy securities on the basis of reptegrity of the capital markets. You
4'600 in ,June, lsj5b*" Mar?y ot resentations made over the long
cannot
have
capital
formation lhe.new broker-dealers are inex- distance telephone by complete

seemed

the..policies of the Com¬
in administering the se¬

(absent

Capital is formed only by thevoluntary cooperation of the publie, and the work of the Commission is one of the factors giving

•

to

quent

.

'First,

groups

expanded and more fre- securities fthis often ends the call
(this often ends the call
broker-dealer; inspections, because use of the mails gives
prompt investigations of irregu- Federal jurisdiction under the Exlarities discovered in inspections change Act and the Mail Fraud
or
complaints received from the Act) or to put the official propublic, and prompt and vigorous spectus or offering circular (which
legal action in the case, of viola- in the case of a new issue is re-

........

Broker-

Dealers

civic

calling on the long distance
phone and holding out promises

is there any financial or edu-

stituted

and

SOns

a

cational requirement. We have in-

o,f -these

some

efforts

en-

proof of earlier violation of law)

though
greatly

been

There is nothing

country.

our

1953,

in¬

which

sion, seeking to acquaint the pubnc
with
the
dangers
of
stock

authority

registration

from

person

public

a

under

is

The

have
talked
at
gatherings, particularly to

transactions
no

had

public.

the press and on radio and televi-

safety of

securities

or

problem

the

of

program

professional

them.

The Commision has

foreshadowed in Mr. Demm-

ler's talk here in
the problems have

to

the

threaten

under the Exchange Act to bar

magnified since then.
.*

—»---

standards

to

ence

"boilerroom"

gullibility

public

speculate

or

customers' funds

interesting to note that this, too,

scribe
•

re-

thus

was

:

,

SEC Aids Capital Formation

adequate financial

unwisely,
getting into financial difficul-

sources

provisions

Commissioners

.

either lack

in-

badly, the

of the Ex¬

particularly difficult aspect

the

of

policies, by far the most important
over-all program of the agency is
our
enforcement program.
It is

ing to make those programs conform

,

the

serve

him

0

markets; to provide corporate sim¬

One

the

As to programs of the Commission in carrying out our general

then seek-

we were

j

to

serves

any

protective

Commission has

about
the
corporations
issuing signed to impede the!raising of experienced and, in some cases,
e
them; to -provide regulation of the capital. " These lajvs if.. well ad- dishonest brokers and dealers regexchange markets so as to assure 'ministered should help; -not hurt, istering under the Exchange Act.
r 4-The recent great activity in the
free, fair, open and orderly mar¬ the capital formation process,

kets;

■;u

nation is the loser.

obstacles to the

unnecessary

• i

fails

or

the

such

Public Must Be Educated

prereq¬

intent of free securities market and free

j»

.

industry
vestor,

raising of capital." Also, through
his speech ran the theme of the
importance of not sacrificing any
of the basic safeguards for protection
of
the
investing public
which had been built up over the

issuess

in

national

on

...

T

pose

in-1

in

sold

and

commerce

listed and

,

and I think most

"the Government should not inter-

in

prevent

Commission's

formation

issues of corporate

new

Congressional

ensure

i

and prudence; and lists the

care

actions

rules; and
third, where the violation is will¬
ful, reference of the case to the
Department of Justice for criminal
prosecution.
*
•
1

capital formation.

ana

success

the

or

d

functioning

markets

to

the
a n

of the Commission

programs

uisites

ob¬

jectives,
policies

change' Act

ruling, and operation of newly enacted long needed amendments; details

public's responsibility in exercising

nity to discuss

fraud; second, to

to

'

in violation of

ness

summary prospectus

new

and

trial

and action

"fraud money" racket, "no sale" rule, unregistered

as

securities, and illegal sales from Canada; reviews

Exchange
Commission,

—

courts

transactions, and to prevent
broker-dealers from doing busi¬

be taken by—securities industry in this objective. Mr. Armstrong

must

or

injunctive

Federal

con¬

d with

adminis¬

the

bring

efforts made to minimize fraud, SEC Chairman deals

on

with Commission's efforts to increase jurisdiction to detect and forestall rising

business life is

cern e

kets

or

45th Annual Convention.

your

proper

proceedings
against
broker-dealers found to be selling
purchasing securities by mis¬

Chairman, Securities and Exchange Commission, Washington D. C.

Association of America assembled
in

SINCLAIR ARMSTRONG

By J.

great pleasure for me to
Investment Bankers

a

address

LOUIS

NEW HAVEN

SAN

•

•

FRANCISCO
PITTSBURGH

in

DALLAS

•

'

'

.

TORONTO

HOUSTON

•
•

ITHACA

RICHMOND
SI! AMOK IN

£0

(2526)

The Commercial and Financial Chronicle

Some External Aspects of Canada's
The

growth

of

the

Canadian

economy

a

Since

C

a

d i

n a

have
both

International

Monetary

Fund

Gross

After

t h e mselves

the1r

and

denly

Mr. Rasminsky explains secondary industries-

aggregate investment h^s beeri several, times

by

pol i tan

large

as

investments in the

as

and

business press.

rising faster than increasing exports; U. S. capital market's accessibility makes
Canadian

dian

Cana¬

has

saga

Louis

jihowed
of

signs
growing up,

based

dramatic

on

between the

Rasminsky

two

output

luminum,
id
*

so

iron

—

It

v

example, oil and natural gas have
contributed to the development of
a sizable petrochemical industry,
Perhaps most important of all, the
uncovering of important, basic resources has created, in the minds
of Canadians and non-Canadians
alike, a favorable attitude towards
Canada's long-run prospects. This
favorable attitude, and the willingness to back it up with hard
cash, is reflected in the high level

hese resources developments have

tracted

great

attention, for not
only are they important in themelves, but they provide the very
;uff

;
•

ig
)

which

of

g

magnitude, difficult pioneerin
remote
and
forbidding
wonderful

luntry,
i

icnts

have

discoveries

anadian

expansion.

they
oening up

provided
not

have

able

the

to

our

stand

ada

on

.*
vi-pat
great

•

.

imnnrtmw
importance: for
for

address

the

43rd

-onv._-ntion.

by

Mr.

National

New

York

Nov.

.

most

Rnsminsky beForeign Trade

City,

development

as

factor

a

in

development. Growth in Canduring the last few years can,

,

—.—

♦An

ternational

bulk

.

,

impressive,

is below

the

,

but

the

Surface

great
and

not unknown at least invisible.

2G.

fact,

investment

aggregate

payments

if
In

But the rate of investment

higher

and service facilities, in non-residential construction and in hous-

ing has been several times as large
as investment in the exploitation

proportion of our gross national
product devoted to investment Ims
exceeded 20%; this year it will

of

primary

have

in

had

is

which

What

resources.

general

a

basic

expansion,
have

resources

structure

we

of

the

Cana-

Relatively undecountries sometimes act

in

Canada

been

has

it

than

has

considerably
been in the

amount to the very high figure of
These rates are considerably

higher

than

figures

for

There

corresponding

the

United

the

appears

be

to

this

ception of

tent

the

to

our

investment

case

sumption
The

a

ranged

tage is incompatible with the d2velopment of secondary industry,
Our
own
experience
has
been

do not result directly in industrial

now

that the two

range

well

can

hand

go

in

hand, and that the broadening of
the

internal1 market produced in
part by basic resource development
brings
in
its
train
the
devclopment of secondary manufacturing industries and service
industries

well.

as

pipelines
into

or

projects

which

and

very

still

long

are

to

$1

which

are

current

from

running at

billion

a

of

are

still

to

be

deficits

million

rate in

excess

These

year.

follows,

rapid

are

smaller

novelty

is, of course, by
lated

in

new

deficits

are

countries.
on

no

expansion

means

iso¬

an

striking economic facts of the past
lew

is the great increase in

years

the

demand

for

capital

to

finance

expansion in virtually all parts of
the

White, Weld Sc Co.

world.

sal

in

rise

supply
Wall Street, New York
5, N. Y.

One of

tions of this has

of

interest

savings

culty in keeping
for

mand

the

Canadian

tion.

One

most

Mr in hers
and olhrt

.

\nr )

)

if; Slink

principal Slock

the

nuLWM.rw.x

Ext.hnyt^y.

seemed

LOS

axojj.es

of

end

ing

is

ress

at

was

IV/XUIIXIEU

1950's

has

year or

of

true

since

the

other countries. In
have

sulated

two, accel¬

Usually

•

ZUUtUl




•

(

if!ALA

>

•

been
the

have

sharp

have

been

halted

This
in

war

has

most

New York

Canada, though
completely

44 Wall Street

in¬

cyclical disturb¬
been

experienced
elsewhere, these have for the most

FoRfclCV OFFKES
LONDON

not

from

that

ances

the

continuous

temporarily

or

even

during

elsewhere

expansion

Investment Securities

prog¬

and

by cyclical down-turns.

we

it

mak¬

civilian

been

and

moderated

been

first

of

expansion.

new

Canada

bursts
ruoYiuLxac

At

war.

reduced;

there

erating
in

Canadian

standstill

a

and, in the last
MINX! A rous

or

na¬

our

question

a

maintenance

IIHI. V

IIACEIISI OWN'.

in

the

during which

war,

means

for the depression and the

up

SA X III ( XCI SCO

iixchait'■

Though

no

expanding al¬
interruption since

the

NEW

and CniHtnviiiiy

bv

perhaps, two

that

Established 1SS0

been

be

to

diffi¬

with the de¬

features

without

(J If(J CO

is

Hallgarten & Co,

the

as

had

funds.

case

has

economy

univer¬

rates

pace

are,

three soecial

manifesta¬
the

has

loanable

unique, there

imrw

the

been

ffO.VG KONG

part taken the form of
the growth of output,
rather than
A

istic

of

pause

in

remarkable
has

In

magnitude.

at

some

terms,

real

been

the

end

currently run¬
40% higher than it was
of

much

the

1940's.

This

growth

of

different

output

from

in the

Brussels

its

gross

in

itself, though impressive, does not
seem

Scranton

L« Salle Street

First National Bank

1954,

national product is

ning

231 S.

Building

chracter-

erowth

our

Chicago

in

down-turn.

a

second

a

as

the

United

60

rue

Ravenstein

Geneva
8

rue

Petitot

London
24 Old Broad Street

no

Fre-

page

In fact, one of the most

case.

they

expansion.

Continued

plucked.

than

Capital

Canadian

recent

of

are

Expansion
The

a

in past periods

Current account

erable share of the fruits of Canainvestment

our

big
figures by any standards, but it
is worth remembering that as a
percentage of total trade turn¬
a

they

dian

con¬

until 1955, but the deficit is

usually been

consid-

us

account

have

a

goods
to main¬

beyond

$400-$500

over

that

on

for

capacity.

be reflected in our production
statistics such as oil, hydro-electrie development, and so forth. It
of course,

ex¬

drawn

world

immediate

own

year

as

have

we

the

of

tain levels of investment and

higher

output,
such
transportation,

deficits

one year

which

rest

has gone into activities that either

economic

account

since 1950 are
the focal point in our balance of
payments. They represent the ex¬

advan-

natural

a

re¬

which have persisted with the

differ-

United States—that in
of

current

and services to enable

between the recent character
of investment in Canada and the

the

Exports
The

States.

cnce

proportion

our

Imports Increased Faster Than

United

25%.

on

Both

sources.

states
and
most
other
countries.
Ever
since
1948
the

Uninterrupted

40

in¬

developments reflect

substantially,

pressure

in¬

has

very

these

growing

,

,

States.

in our secondary industries, in
communications,
in
distributive

have

perhaps not inappropriately, be
compared to the proverbial iceberg: the parts that one sees are

"

.

resource

be exaggerated

can

actual

veloped
as though
the development of the
primary products in which they

Secondary Industry
Investment

However,

ex-

would

thpm swnnHarv

of
of

economy.

Larger

They have brought

'

.

jments
oments

to

the

dian

since the

our country

end of the war.

and

areas

which

ened

some

involved

opportunity

been

with

In

remote

resources

feet.

own

one

have
of

the

loit other

their

and

developI
have
been
referring to
had
a
leavening effect on

ases

;

engineering

ecornplishments.
The

•

least

(at

romance

onomic romance) is made—dar-

played an important dynamic role,
which' has broadened and dpeo-

in£ place in

that

wonder

no

account deficit in our

current

creased

of investment which has been tak-

is

less

national product this year
includes a larger element of price
increase than previously, and the

of

uranium, water-power

on.

under

The increase

in gross

taining monetary stability.

petroleum,

ore,

spread

rate

there

be

not

buoyant conditions.

has been helpful in main¬

basic

certain

of

rate

,

^sources

would

countries; growth potential rather than yield influences for¬

achievements
which
have
•reatly increased our output and

potential

relatively small changes in interest

to

eign investors in Canadian equities; and free

outstand¬

and

borrowing sensitive

ing

i

running at
higherThan 1955;

labor, force resulting from popu¬
lation growth; and immigration:
good jobs have attracted more
people into the labor force who

investment rate has been considerably higher

resources',

A

new

currently

this

than that of the U. S.; investment boom is primarily responsible for imports

metro-

your

is

and

rate about 10%

a

value

ing the 1954 pause. The increase
year has absorbed more than
the; regular annual increase in the

publicized primary

red is-

covered

expansion,

in

product

10% higher in 1955 than.

was

The increase in 1955 took up most
of the slack which developed*du r-

sud¬

country

economic

marked.

importance of foreign trade.

find

to

Canadian

recent

in¬

investment

very

Bank of Canada official depicts America's stake in world prosperity and the

embar-.

rassed

1954

reviewing external aspects of

and

has been

national

1954 the

of

pause

output

Canada

terms

occasjon-

11-y

Director,

n s

a

been

flattered

and
a

Executive

at home.

as

in

the
in

crease

Deputy Governor, Bank of Canada

great deal of attention

outside Canada, as well

Thursday, December 13. 1356

.

Expansion

By LO UIS RASMINSK Y *

in the last few years has

attracted

.

.

71

:

Volume

Number

184

5594

The Commercial and Financial Chronicle

.

.

.

(2527)

31

Growing Foreign Investments
Over

the

decade

past

vestment bankers have

By ROBERT L. GARNER*

in¬

you

been

*

-

.

President, International Finance Corporation

.

.

You

financing American industry, util-

The

despite

present
problems in
the

the

critical

the

East

I

by Mr. Garner in

to

undertake foreign

to

not

underdeveloped countries.

houses

self-interest in the

our

Advises general

investments; foresees end

of in¬

run

growth; and

the

a

coming

I

a

big

mestic

L.

Robert

and

uar.>kr

fi¬
,T

„

breath.
the

over

But

believe

1

foreseeable

will have

that

future

we

depression compar¬

no

able to those which have occurred

but

assuming
reasonable
peace, growth in production and
trade in the rest of the world ,s
likely to be more widespread and
rapid than ever before.

when

we

live

to

life

government

has

that,

as

complex,

necessarily

ex-

on

down

us

outside
011

would

45th
ment

address

Annual

by

Mr. Garner before the
Convention
of
the
Invest¬

Bankers

Hollywood,

AssrcJaiion

Fla.,

Nov.

29,

of

America,

1956.

Oc.r

g.aie-

were

lives

secure

settle

and

own

we

and

children

our

Marne

and

the

going

they

Indians

ever

of

the

with

suffer

to

And

its

stagnation and

and

a

Verdun, at Bataan

Bulge, and what is today
in Hungary, Suez a <1
is

more

decisive

what

Detroit

but

to

happens
or

New

our

in
Or¬

Europe and through¬
out
the
Middle East, Asia and
Africa the long-established order
has been torn up by the roots. ■ >
Russia

feudal
a

upset this way of life.

rule

more

tyranny.

and

its

has

been

border

states

surplantad
effective and bloodier

Outside

Motor

roll tourists to the pyramids.
GFs went into the islands of the

cars

of

the

Com¬

countries, for the lirst
time in history, hundreds of mil¬
lions of people in the undeveloped
areas
are
learning that there is

who

of

country

be¬

more

developed

comes

the better customer it will

a

Millions

thgii*

These

the

are

and

and

motor

canned

meat

siocKings. They
things and they

nylon

ana

these

seen

of

want

cars,

have

them.
Western
few

colonialism, for which

dare speak a kind word,
which represented law and

now

but
d

e

arid

responsible

rK

is

considerable

a

degree
of
is dead or dy¬
ing.
And in its place are new
nations, unsure, inexperienced,
often
irresponsible. They repre¬
sent

a

And

vacuum.

of

one

tne

gravest questions in the world to¬
day is how will that vacuum be
filled—whether

brutal

process

the

Investment

of

that

I

They

should

be

hardheaded L. Americans

are

carried away by the lure

the

everywhere and

same

certainly
not
sound
abroad,
are difficult conditions and

sible rewards.

Foreign Investment Pros and Coiks
An

interest

increasing

the

on

Now

part of American business in ex¬
has been

Finance

ternational
over

some

discussions

tional

with

broad

a

We

terest

pros

both

and

of

lesser

are

on

aware

the

also

been

has

have

Many currencies

government

institutions in investment abroad.
One ' indication

ju«-

hazards

political and

conditions

weakened by inflation.

financial

of

part

faced.

in¬

new

across

extra

unstable and erratic

financial

size.

of

has

of!

>

business

borders

briefly
cons

today,
particularly
in
theeconomically less developed areas;,

industry, in¬
giant corpora¬

the

those

and

and

cross-

section of American
tions

consider

us

the

Obviously

Corporation

the past few months, through

cluding

let
of

operations overseas
foreign investments.
proved to us in the In¬

its

panding

policies

to

are

bo

being

Laws and

frequently

present difficulties. Nationalism is

more

often

combined

with

general

a

participations
in
World
Bank
suspicion of foreign business.
loans by commercial banks and
Standards
of
business
conduct
insurance companies. Another is
frequently fall far below what we
that several of the most conserva¬
tive

banks

in

New

York

have

vestment

friendly
help of
the aggressive

by

clear

Abroad

with

or

it

make

risks and these must be
carefully weighed against the pos¬

begun to put certain of their in¬

the

ta

greater

by the progres¬
sive development of these people
West,

represents quite

There

government

economic progress,

accounts

into

stock

consider

appropriate.

In

many

plates there is scant experience in
Continued

of

on

page

and

Communism.

Bankers

Face

World

Opportunities
Now

let

down

get

us

the

to

question of what all of this change
ill
the
world
means
to you
in¬
vestment

Underwriters and

bankers, to

your

trial

commercial

clients, and

to

;■

and

.all

of

us

Americans.

sell-interest

our

of

luture

the

in

indus¬

What

the

coun¬

tries.

distributors of

make three basic points.
Paley
Report
merely
pointed up what is obvious, that
we
increasingly need raw mate¬

rials

Municipal Securities

i

c

s

o

u

n

t

corporation

shall

i

The

Corporate and

d

is

economic

undeveloped

iron

aule

minor
more,

copper,

are

—

man¬

innumerwhich, more

the

or

metals

necessary

industry.

hungry

abundant

borders

our

orje,

bauxite

ganese,
and

outside

iroin

whether

for

OF

Iew

york

our

And the most
lie in the less

supplies

developed countries.
Their con¬
tinued
availability depends not
merely upon the technical devel¬
,

Dominick

&

Dominick

mines, but

Members

New

Toronto

York, American &

Stock

Exchanges

of

need

not

to

of

consume.

products

our

alone

by

the
but

exports,

our

worth

Bankers Acceptances

$14
must

e,\&en more bil¬
of
goods produced
business
enterprises

by

owned

wholly

Americans.
lor the

even

it

Thus




United States Government Securities

into account

lions

tion

ca¬

likely
indefinitely. Tne impor¬
us of foreign
markets is

abroad

of Canada, Montreal

now

we

sell

to

measured

billion

Dominick Corporation

the

and this situation is

exist

take

place,

farms and factories

our

greater lhan

abroad

tance

...

the financial and

upon

the'-' second

In

pacity of

to

Canadian affiliate

Dealers In

tne

countries themselves.

the

We

r:cw york 5

of

political stability and the attitudes

is

14 WALL STREET

expansion

and

opment

that

greatest

is

United

does

the

in
part
by
big business

or

Tnis

not

States.
seem

United

producing

in

FiftY'Eight Pine Street
New

ques¬

States,

and

the

consum¬

ing: nation in the world, stands to
benefit
tional

by

expanding

production

and

interna¬
trade

and

g

opportunities

ness are

facts

economic

111 vestments

111

Interest

people have had
glimpse of something
exciting — of airplanes

n

their

what would not be sound at home

be.

of

first

k i

abroad, without
applying the judgments
which
they
recognize
as
essential
si
home. The elements of good busi-*

highly industrialized. The

and

.Pacific, Burma, China, with the which give this country a stake
trimmings of tne American way in
developing the undeveloped
of
life.
Hollywood films reveal world.
throughout the. world a picture

,

In much of

In

our

has

new

a;

on

,than

ous

the centuries,
generation in tne West
over

not

of

blindly into foreign business

posedly

countries but those most prosper¬

changed

are

a n

cautiously and selec¬
tively. I am sometimes surprised
by the enthusiasm of some sup¬

finally our best customers
the undeveloped and poor

Andes, blacks of Africa, peasants
of Turkey, Iran, India have lived

0 r

by

than

of

b

suggesting that Americans,

investment.

or

decline.

Generations

cannot

the destiny of living in
world in which what took place

eseape

the

better

knew.

of American riches.

back..

turn

can

munist

"An

our

problems, but there are
few among us .who still think that
our

leans.

to accept the fact
has
become more

of

own

Pittsburgh,

lorced

going

Americans

our

sumed

generation has seen great
changes in our country and in
our way of
life. We have been

stale,

luliy return to the good old oays

approve

Our

is

bears

Most

luture.

future

try.

the

it to drive

want

borders

Moscow

-— government
h a s
as¬
responsibility for sta jillzing the economic life of the coun*

by

operated

what

And
our

something

of the

many

approached

little

not we

or

traf¬

no

l\ow the traffic li.nts

don't

we

mature

more

a

and—whether

horse

The

required

age

cars.

We

Also,

We have become

be

must

periodically in the past.

economy,

activities.

buggy

fic control.

nancing.
Assuming no major war, the U. &
economy will continue its growth.
The pace will vary, but like a sixday bicycle race, it will keep go¬
ing. I trust that there will be
periods when we slow down a bit
to consolidate our gains anu catch
our

its

tended

volume of do¬

wish
not

rush

years,

handle

hav^

change.

am

promoting the spread of free enterprise system abroad.

urges

new-

which

Street

Wall

in

deals. All of this

iTi:

you

in

several

interest in going along with us in
'A'

depressions

to

the

told by them and by
leading* investment

comparable to those of the past; expects greater world trade and production

be-

e v e

will

vestors

Eu¬

and

referred

are

of

companies

organized for foreign invest¬
ment, and we in the International
Finance. Corporation
have been

future, and the

upon our

and principles of the I. F. C.; and

future of

economic

in

Middle

rope,
1 i

ments; the purposes

and*

situation

cor¬

been

depicting the investment bankers role in the growing field of foreign invest¬

bond

market

inescapable changing world's decisive impact

increasing importance of foreign markets,

some

in

leading foreign

know

.

financial

pub¬

lic authorities.
And

the

porations.

generally profitably so—in

ities and

of

some

busy
•

—and

IlIIIIllll!lIIII!!l!!i!ll!!!lllIIIII

York 5, N. Y.

79

32

Thursday, December 13. 1956

The Commercial and Financial Chronicle

(2528)

In Attendance at IBA Convention
ABERNETHY,

AUSTIN,

S.*

R.

J.

Securities Corporation,

Interstate

AWS,

Charlotte

james

abrams,
Allen

Ac

York

A If BE,

Hill

Bosworth Ac Co., Detroit

A.

New York

Inc.,

Group,

LEO

Co

Bank,

Boston

KALPII

■

The

GEORGE

Parker

TED

Texas Bank

J

E.

A.

BARROW,

BASS,

JACK
Bass

M.

A

BASSETT,
E.

EARL

Hutton

Selected

Allyn A Co., Chicago
TAYLOR

Rauscher,
ALTGELT,

Jr.,

E.

BOWEN,

J.4

Harris Trust A

Bank,

Savings

New

York

BEAUBIKN,
L.

Irving Lundborg
Dow

A

Anderson

W.
A Strudwiek. Richmond

ANDERSON,

BELL,

New York

WILLIAM

United

A

Coe,

APPI.EGATE,

Washington

BENT,

LOWRIE*

A.

Pittsburgh
New
New

York

Hansen tic

Corporation,

R.

Securities

J.

SINCLAIR*

and

Exchange

W.

The

ARNOLD,
Arnold

WILSON*

II.
A

Crane,

Arthurs,

ATKINS,
R.

S.

ADDISON

Dickson

A

Co.,

HARRY

Boston

MURREY*

Chicago

Atwill

Jr.,
A

Miami

ATWOOD,
L.

CHESTER

F. Rothschild

A

Freres

A.

The

New York

Co.,

II,

^Denotes

Mr.

and

A.

BROOKS,

Chicago

BROPIIY, FRANK J.
Dickson

A

Co.,

New

BROPIIY,
The

L.

CARL

Laurence

Co.,

New

York

BROWN,

CARTER,

York

Press, New

M.

Marks

A

Co.,

A

BROWN.
F.

Co.,

A

New

Barney

C.

A Co., New

York

The

HENRY

Chemical

L.

The

National

First

Jr..
line

Value

CHAPMAN,
Fulton,

R.

CHARTERS.

CIIILDS,
F

CHILES,

f.

DALY,

Ac

Co..

WARREN

Chiles-Schutz

CIIISIIOLM,

and

Distributors

'

NEW

YORK

SANTA

CHICAGO

BARBARA

LA

SPRINGFIELD

PITTSFIELD

NEWPORT

LOS

BUFFALO
LA

ANGELES

BEACH
ROCHESTER

CROSSE

BEVERLY

HARTFORD

BASLE

^

HILLS

Pacific

A.

York

Stock

Exchange

Canadian

Stock

Exchange

American

Stock

Chicago Board 0/
Chicago

Exchange
Trade

Mercantile




Exchange

Midwest

Stock

page

Securities

ANTONIO
»

F. S. SMITHERS & CO.

MEMBERSHIPS

Exchange

Commodity Exchange, Inc.

Angeles Stock Exchange

New Orleans

Seattle

on

BRITAIN

SAN

HOUSTON

(Switzerland)

Liverpool Cotton Association, Ltd.
Los

Northwest Company,

Industrial, Public Utility and

Established
New

Ac Trust Co.,

ROBERT E.

State, Municipal and Public Authority Bonds

PASADENA

NEW

).
EXCHANGE

York

Corporation,

Continued

Railroad

r-

■

MIDDLETOWN

DALLAS

New
H.*

II, OWEN

DANIEL,

Omaha

Advisory Service

MONTREAL

JOLLA

PARKS

Securities

Underwriters and Distributors of

;

and

Ltd.,

of

Investment Securities

Research

Jr.,

Chicago

McG.

Bullock.

Baltimore

Varnedoe, Chisholm Ac Co., Savannah

Underwriters

JOHN

W.
Co.,

Chicago

I).*

Co..

FRANK

Ac

Mercantile-Safe Deposit

NEWELL

Childs

Minneapolis

Co..

Charlotte

Exchange Firms,

Stock

S.

ARTHUR

Interstate

York

New

Calvin
DALTON.

Cleveland

Co..

MICHAEL

R.

Association

Co.

York

Ac

Hutzler,

Beach

JOHN

Becker

G.

DALENZ,
New

C.
A:

A.

Paul

R.
Distributors,

JOHN
Fund

Reid

St.

Ac Curtis,

A.*
A:

Bros.

Palm

CURTIS,

Bank,

RALPH

Kalman

Louisville

Los Angeles

F.

York

CURTIN,

B.

Crouter &

H.*

Weedon Ac Co.,

Salomon

Bank,

W( st

Co.,

WARREN

JOHN

CURRAN,

W.

JAMES

Durham

York

GORDON*
A: Townsend,

Webber, Jackson

Paine,
New

New

Co.,

A:

Philadelphia

Crowell.

P.*

EDWARD

CHAPIN,

Haven

CURLEY.

Boston

St. Louis

I).*

M.*

CALVIN

CROWELL,

■

Exchange

Lyons A:

CHAPIN,

r

M.

Com

CHANDLER,

6

York

York

New

W.

F.

Keystone Company,

CHAMBERLAIN,

Shearson, Hammill

De

EUGENE II.*
A: Co., Charlottesville

Jr.,

J.*

Securities Corporation,

Bodine,

Cassell

F.

ATE,

WILLIAM

( ROUTER,

Chicago
New

Richmond

Ac Co.,

WALTER

Hallgarten

'W
(

WALTER W.»

Craigie

CROSS,

I).

Co..

Ac

Chase Bank, New York

W.

First

I).

Co..

A:

Allyn

CASSELL,

York

C.

Smith,

Newark

Atlanta

JAMES

Jr..

F.

Co.,

BRYAN, JOHN F.

Co., Spartanburg

Allyn

CASEY,

Denver

MURRAY

Childs

C.

The

II.*

Goldman, Sachs Ac Co.,

DOUGLAS

CASEY,

York

New

Louis

York

New

Co..

Ac

ROBERT

(ROOM.

Co.,

St.

DALTON

J.

CREELY,

W.*

Co.,

J.*

F.

Jr..

HUGH

Jr.,
Ac

WALTER

CRA1GIE,

F.*
A.

J.

York

C.

DONALD

Boettcher

HENRY

New

Co..

Ac

Chicago

Co..

Carroll Ac

W.

Co.,

D.

Hirsch

A,*

Associaated

BROWN.

A.

A

Ac

LEE

CARROLL,

York

Lee

Boston

Nuveen

J.

Jones Ac

CRAFT.

WILLIAM G.
Haupt A: Co.. New York

Ira
S.

York

New

Rhoades

Loeb.

CARRINGTON,

York

II.

EDWARD

COUIG,

Journal,

ROBERT E.*

New

IIAROLI)

Coughlin A: Co., Denver

FRANK C.*

C'ARR,

Hartford

New York

National City Bank,

First

COUGIILIN,

Chicago

II.

Co.,

Courts

Jr.,

A

A

Guaranty Trust Company,

R.

A.

Corporation,

HOWARD

J.

M.

Corporation,

HALSEY

A.

Edward

PATRICK

Street

CARLSON,

JOHN

BROOME,

C.

Law

Wall

Jackson A Curtis,

John

Robinson-Humphrey Company,

M.

JOHN

York

Putnam

Bank,

Atlanta

Mrs.

CHARLES

Higginson

Carl

GRADY*

BLACKFORD,

Lee

F.

COSTIGAN,

Moseley A Co., New York

New

EUGENE*

Jr..

Lazard

S.

„

E.

Spencer Trask Ac Co., New York

IRVING II.*

Bell, Gouinlock A: Co., Toronto

CAPEK,
W.

COOK,
The

New York

GERAI.D

Chicago

|

York

COOK,

Washington

S.*

H.*
Company,

A:

American Securities
New

L.*
Association,

Bankers

CAMPBELL,
ORLANDO

Paine, Webber,

Company, San Francisco

Beach

BLACK,

F.

York

New

L.

Exchange,

Charlotte

WILLIAM

Co.,

GORDON

Investment

Collins

CONNELY,

New York

II.*

York

New

HUNTER*

CLIFFORD C.*
Philadelphia

Jr.,

JULIEN

McDougal Ac Condon, Chicago

Michigan Corporation,, New York

of

Ac Quinlan, Montreal

Collings Ac Co..

Julien

York

DAVID

Jr..

C.

K.

T.

CONDON, JOSEPH P.

Boston

(ARBERKY,
Co.,

THEODORE*

II.

Co.,

First

Louis

BRICK,
A

J.

California

First.

First

The

W.

Phelps. Fenn A Co.,

VV."

Stock

III,

BIRR,

BLACK,

ATWILL,

St.

BREWER,
York

New

Ripley A Co., New York

Orleans

VV.*

Lestrangc A Co., Pittsburgh

J.

IIAROLI)

Harriman

New

BESSE,
ARTHURS,

York

R.

Washington
BERRY,

C.

York

WILLIAM R.
Corporation,

CALDWELL,

W.

Norris

COLLINS,

A: Co., New
New

Co..

Ac

CALVERT,

ALDEN

I».

Walston

W>

JOHN

York

New

Co.,

Hernnun

Henry

York

New York

Co.,

Collier,

WILLIAM M.

Jr.,

Ac

COLLLNGS,

CALDWELL, .DONALD

McCourtney-Breckenridge A Co.,
New

Co.,

A

BltECKENRIDGE.

BREWSTER,

National

STEWART

Planning, Washington

BItAUNS, ROBERT A.

Pressprich A Co., New York

First

J.

the President for

Ac

Hutton

E.

CAHN,

Brandenberger, Johnston A

McDonnell

A

York

New

Cotton

Exchange

New
New

York

Cocoa

York Coffee

Exchange
New
New

York

1857

Exchange, Inc.
4z

Sugar

MEMBERS

Inc.

York Cotton

Exchange

Produce

Exchange

New
1

-

/

X.

FRANCIS

COLLIER,

Phelps, New York

CALLAWAY,

Montreal

CHARLES

BERGQUIST,

Commission,

Works

Moreland,

W.

GEN.

to

KKANDENBERGKR,

R.*

Marache

BERGMANN,

MAJ.

Allen

cafone, thomas c.

P.

McKinnon,

"

W.

York

New

Ripley Ac Co.,

HENRY

Gregory Ac Sons. New

C.*

edmund

Byrne Ac

*

Philadelphia

COLEMAN, MERRITT

Boston

Co.,

Ac

;

'

SCOTT

Winslow, Cohu Ac Stetson, New York

COLEMAN,

stedman

Estabrook

Boston

;

Philadelphia

Sherrerd,

buttrick,

Trust Co.,

New York

W.*

*

Close Ac Kerner,

Harriman

HOWARD*

Ill,
Ac

CALVIN

PAUL*

W.

CLUETT,

COHU,

Currie, Houston

Investor,

WAYNE

Granbery,

York

ARMSTRONG,

A.

Antonio

Co.,

Whipple

BENZING,
II.

Public

GO Ft DON

Bacon,

Hultne, Applegate A Humphrey,

ARMSTRONG, GEORGE

A

Special Asst.

Philadelphia

States

EUGENE

BRAGDON,

Augusta

Butcher

York

byrne,

Howard,

Detroit

DeB.

A

New

.

Deposit A

...

York

New

HAGOOD '
Miami Beach

Securities Corporation, Boston

L.

Rambo,

j

kollin c.
The First National City Bank,

BUTCHER.

Bank,

CLOSE,

bush,

WHITNEY

S,

A

Thomson

CHARLES

Companies,

'

Co.,

HARRISON

CLAYTON,

Association of Investment

National

York

B.

Manhattan

Topeka

BENNETT, FRANK S.
Cutter, Plunnner A Bennett,

L.

THOMAS

Eaton

RUSSELL ,D.

BENNETT,

>

ed ward, b.

burr.

W.

Jr.,

Ac

L
;
.
4
Johnson, Lane, Space Ac Co., Atlanta

York

Upham

Harris,

Atwill

Clayton

JAMES F.»
& Co., New

BURNS* Jr.,

Development Bank,

MEREDITH*

BRADLEY,

Co.,

Pittsburgh

CLARKE,

CLARKE,

burns^ ii. edward
F. Eberstadt As Co., New York

•

.

ERNEST

Jr.,

FRANCIS

C.

BRADY,

A

G.*

Baltimore

Montreal

WILLIAM

Co.,

A

Greenshields

J.

Nashville

Mackall

Jr..

Co., San

GEORGE

R.

Equitable Securities Corporation,

ANGLIN,

BELL,

Drexel

HERBERT

Jr..

Raleigh

Corporation,

Distributors Group, Inc.,

ANDERSON,

A

E.*

Securities

S.

T.

Evans

A.

BEINHORN,
Russ

GLENN

JAMES

Clement

GEORGE

ANDERSON,
Carolina

BEESON,

York

New

BOYCE,

C.
Union Securities Ac Co.,

Dillon,

-Eastman

Chicago

Tribune, Chicago

Chicago

ARTHUR

BURNS,

Co.,

New York

Simmons,

Ac

WH.LIAM N.

CLARK,

New York

The Chase

C.

Cole A Co.,

-

-

A

Ellis

H. -FRANK /

NashVille

,

Mercantile-Safe

Co.,

•;

ROBERT M *

CLARK,

Securities Corporation,

Equitable

.

Rico

Puerto

BEECROFT, HARRY*

Beecrolt,

Jones A Co.,

ANDERSON,

San Francisco

Co.,

A.

A.

A

CHARLES

-

LAWRENCE
Securities

II.

FRANCIS

BOWMAN,

Watling, Lcrchen A Co.,

AMES, LAWRENCE €.*

ANASTASIA,

ANDREW

Beaubien

G.

BECHTEL,

Boston

E.
Bullock, Ltd.,

ROBERT

CLARK,

PAULEN E.
MacDonald, Kansas City

BURKIIOI lOER,
,

Dillon, -Union

Government

Chicago

Company,

Cleveland

Co.,

Kirkpatrick,

Landstreet Ac

Clark,

Blunt

Tucker, Anthony A R. L. Day, New

BAXTER, DANA F.*
Hayden, Miller A Co., Cleveland

Dallas

AMAZEEN, EDWARD S.*
Coffin A Burr,

A

B.

Pierce A Co.,

Boston

W.

HAROLD

CLARK,
.

Burke Ac

.'

.

Jr.,

BORKLAND,

Jr., CHARLES M.

Baxter

ALMON,

New York

Wainwright Ac Co.,

C.

Jr.,

BURKE,

Association,

BOLES, EWING T.*
The Ohio Company, Columbus

New York

Co.,

Investments

BAXTER,

W.*

Bankers

Fidelity Trust Company,

Shrevoport

BAUM, ALVIN II.

Allyn A: Co., Chicago

Cleveland

ERWIN

BOGGS,-WILLIAM

V

K.

A

'

JOHN F.*
Bioren Ac Co., Philadelphia

BUNN,

York

New

Chicago

Nashville

ALLYN, JOHN W.
A. C.

BOGERT,

.

Co.,

C.

ARTHUR

New York

R.*

Leary A Co.,

M.

RAY
W.

A. C.

B.

A Co.,

harold

H.

Ltd., New York

A.

FORRESTER

CLARK,

HUGH*

World-Telegram Ac Sun, New York

B.

BOESEJL, Jr., RICHARD E.
Kuhn, Loeb A Co., New York

Eastman

WILLIAM

Jr.,

Jack

Ray Allen Ac Co., Chicago

ALLYN.

H.

Gardner,

Reinholdt A:

Calvin

S.

Kindred

Barrow,

F. MONROE

E.

ROBERT

.

CLAPP, Jr., JOHN J.*
R. W. Pressprich Ac Co.,

Bullock,

bunce,

-

Boston

New York

Co.,

Hutton Ac

Calvin

F.

City Bank,

Investment

K.*

JAMES

Barcus,

Leedy, Wheeler Ac Alleman, Orlando

ALLEN.

BARCUS,

F.

BULLOCK,

York

Washington

Morgan Stanley A Co.,

Company, Dallat

Oranbery, Marache As Co., New York

ALLEMAN,

/

BALDWIN,

Boston

R.

Ac Trust

GUSTAVE

ALEXISSON,

I>.

ROBERT

BOE1IMLER.

Winnipeg

Sons,

A

Nesbitt, Thomson A Co., Montreal

I>.

Corporation,

ALEXANDER,

j

BALDWIN,

Aldinger Ac Co., Detroit

Fordon,

ALDBICH,

CLARENCE

National

York

New

I).

Richardson

H.

E.

.

M.*

New

ARTHUR A.*
St. Louis

CHRISTOPHEL.

a.*

Distributors,

RICHARD k.*

Nashville

BI.YTH,

D.

Weld A Co.,

BAKER,
James

ALBERT

S.*

Blewer, Glynn A Co., St. Louis

Chicago

Co.,

PHILIP

Fund

BUECIILER,

ROBERT

Weekly,

BLKWER,

1

Putnam

Boston

Byllesby A Co., Philadelphia

Barron's

Los Angeles

Co.,

Becker A

BAKER,

SIDNEY

M.

H.

BLE1BERG,

richard

buck,

L.

Howard,

A

BLAKE,

D.*

B.*

Richards A

White,

ahkakn, JOHN W.
Rockland-Atlas National
ALDINGER,

Eaton

Atlanta

Co.,

BAIR.D, ANDREW M.*

L.

JOHN

Distributors

,

KENNETH

BABICH,

ADAMS, WILLIAM M.
Braun,

A

JOHN

BLAKE,

HOLIJS*

Irving J. Rice A Co., St. Paul

s.

New

Co.,

J.

Tindall

W.

York Stock

Exchange

WALL STREET
New

York

5

-

*

•

American*Stock Exchange
RUSS BUILDING
.San Francisco 4

90

Number 5594

Volume 184

..

The Commercial and Financial Chronicle

.

33 *

(2529)

Public Works Needs of America
It is

distinct pleasure for me

a

By MAJOR GENERAL J. S. BRAGDON*
,

to

before such
audience.
My

appear

guished
however

is

tempered

distin¬

a

ers,

Reporting "state and local governments

bank¬
this audias

tut.es

President's

one

which is most

have

discerning.
Traditionally,
been

to

have

bankers

men

as

to

catch

meet

who by nature

refuse

by

non-

them; details

stream

essentials

and

much

as now

and

1

areas

in which investment bankers

can

serve

concern

for such critical problems

as: water

quickly

coordinated
j

ciently

co

and

constructed,

d.
nomically operated,

eco-

v

It is necessary at the outset,
for me to define the term "Public
its present stature if you and the Works" as I shall use it.
This
other financial leaders of the na- term will be applied to the plantion had not devoted your lives to mng and construction of public
clear and
objective analysis of or quasi-public^ facilities such as
,

requirements

in

backlog. These are the con¬
struction items needed in the past
but deferred.
Secondly, $6.2 bil¬

local

adequacy,

lion of the requirement is due

obsolescence.

un¬

of

*

and

sions, and 3,049 counties.
these are
the
special

-

posses-

fo

is the volume'

facilities which have served their

.

territories

This

replacement needed for those

economy

,

v

.

today

is

A

mm„

>

t

;

about 75% state

life.

Finally,

there

are

those required for the growth in
population

This

Beyond

and local and about 25% Federal

water and

sewerage

purpose

with

totals $91 billion

a very

small portion identi-

component

of

reauirpmpnt*

the municipalities, the fiable as Federal aid to non-Fedowi-iand almost 60,000 eral programs.
*
wi^r^a^jy^jnay be made
school districts in the United
The cost 0{ pubUc works in 1955 local pubUc works
If we were to
States., Altogether there are 109,- was $12.5 billion, the greatest total catch up bv l964 we sh^l^h^
in our historv. yet 1956 is break-; .^ai"S
000 governmental entities plana
^
history, vet 1956 is break-

districts,

~

townships,

xuaus,

the best of that Which is old.

water supply systems

and other

naL a„7TS«

SiftertS^W~,13-,14bfc' ? ^ 42.3% of The
Ccta dicTn Sd fnterests variation in State and Local $208 Billion Sefb^ted'eacW^feUing ^
as public methods and ends, and diversity of
Backlog
ther behind each year.

i feel

however,

sense,

a

a

'

hin^VrYn'h^s0 obT«v!tyWAs you
I
engine^. Through-

taSw
out

am an

officer in the
and later in

an

mv career as

Engineers

of

Corps
.

private practice, I too have had to
with proposals and projects
variety and great diver-

deal

of wide

sity of value. I like to think that
the professional engineer can and
does match the banker in his im¬
of the problems
with which he is confronted.

analysis

partial

Securities

Public

and

Works
I would like to discuss with you

concept of the proper planning
of the nation's public works.
It

a

is not

necessarily

rather it is
This

new

a

tried

certain

concept,
arrangement of
new

a

ideas*

tested

and

foreign to
might seem
the case at first glance. You who
participate in the flow of industrial,
commercial,
and
governmental credit are, of course, insubject is not

as

investment banking as

lung

ana

cAecuung

puDuc wores

ing that record. We estimate that current "rate is less thaV half nf
the current year's total will be that
In 19M the
rate whs

today. Considering this fact alone

aLual

commonly lumped
works under many municipal gov- financial stature. We believe that
ernments In short, I am exclud- any system which can point the
tcnance- and operations way toward more ' consistency
of public buildings, roads and among these governments destreets, publicly-owned u t l l i t y serves mature consideration.
systems, and otner public iacilii have already alluded to the
tiesplace of pubic works construction
Within

this

context I

will first

remind you that the nation's public

works

executed

are

of

sands

Relate

aupurts,

4-

4-

three

requirements, quoted as $25.3 billion, we can identify $10 billion

public works planning.

states,

have

that which is new wnue retaining

In

nuspitcus,

53

facilities
billion in water and
facilities.
These esti-

$25.3

useful

laid before
them. This is as it should be. The
financial standing of the United
States would never have reached

elemental in any idea

worth of

educational

main components.
Considering tlje
estimate for water and sewerage

systematically

better

for

mated

-

to

$200 billion. There are,

highways needed, $41.5

sewerage
.

spent—in order

pollution, public schools, highways, overlapping jurisdictions and

that which is

on

as

public works requirements, in order

bring their at¬
bear

to

billion

requirements,

sewerage

over

for example, $92 billion
roads and

by 1964. Maj. Gen. Bragdon outlines proposed "Measured Needs"

up

officials, and expressed

be

to

misled

tention

.

training

and

Jokn s. Bragdon

in meeting

year

public works policy advisor states these governmental units will

spend $20.4 billion annually—twice

method of determining

recog¬

nized

falling behind each

are

$200 billion backlog of roads, education, water and

consti-

ence

our great backlog. In the field of
state and local public works alone,
requirements today are estimated
to be

realization

that,

.■

Special Assistant to the President of the United States

pleasure
with the

units

of

by thougovernments

throughout the length and breadth
of the land.
These public works
serve millions of people.
There is
scarcely a person in the United

in the nation's economy.

All

Despite this large national pro- Critical Educational and Highway
there is still a great deal
Problem

gram

remaining to be done. One of the
Let us examine some of the incontributory factors to the great dividual fields of public facilities,
backlogs which exist is the as- First, consider the

most
have

the
this

use
of public facilities aldaily. These public facilities
a
capital cost measured in

billions

of

day

of
a

dollars.

$400

in

Even

billion Gross

for

ac-

Over the last 40 years our
Gross National Product has
climbed from less than $100 bil-

"customers" of public facilities.
In the 320 years between
1620 and 1940, the nation's population grew to 131 million. Last
year it stood at 165 million.
By
1975
an
estimated
211
million

lion to its present level of approximately $400 billion.
Total

people will be living in the United began. In 1955, there were 32
States. In other words, in a 35- million pupils and it is estimated

con

-

struction, public and private, is
a significant element in the economy.

the

States who does not in some way construction, although affected by
make

case

tounding population growth of the celerating the construction of
United States. These people are public schools. Most of you know

depression, has always
constituted 8 to 12% of the Gross
and

war

National

Product.

construction

has

Public
varied

works

between

1% and 6% of the Gross National

National Product, a billion dollars Product,

averaging

about

3%,

year

period

we

there

upsurge

has

been

an

in public school

amazing
enroll-

ment. The number of public school

pupils

held fairly constant between 1930 and 1950 at about 25
million pupils. Then the increase

will add 90 million that there will be 42 million in

of public services, a number
equal to two-thirds of the entire
population growth attained in the
prior 320 years.
The needs of
these people for public facilities
users

are

that

virtually unlimited.

*

1965, This creates a critical shortrange
problem.
The classrooms
needed in the next five years total
470,000.
210,000 are needed for

added enrollment,

180,000 to

re-

place obsolescence, and 80,000 to

is still a lot of money. This being which incidentally is where it
In addition to the population relieve overcrowding.
the case these public works de- stands today. The composition of growth, two wars and a depresThis problem is being attacked
mand comprehensive long-range
,
*
to accumulate
Continued on page 66
terested in the various securities planning if they are to be as ef- thls Public works element of our sion have served
of our thousands of governmental fective
as they should.
This is
units.

these

of

Many

securities
to

to

obtain

funds

needed

public

facilities.

pledged

are

,

the

theme

on

which

I

,

.

to

wish

—Y

speak.

I
'

provide

thus

You
in

have

these public
:

■„

♦An
don

45th

the

Investment

of

America,

that
'ft:

effi-

by Major General

address

before
the

insuring

planned,

well

Annual

Bankers

Hollywood,

Variation of

and

Bra?-

Convention
Association

Fla.

1956.

Public

I

Works

concern

facilities are properly

,

conceived,

of

direct

a

of

matter

the

Size

It is not

I

generally realized that

I

vas^ numbers of large and small

I

governments are engaged in pubworks

construction

States.

United

The

in

number

the

is

UNDERWRITERS

For instance, there
alone in
the construction field. There are

almOSt legion.
are

4Q

I
I
I
I

Federal agencies

I

I
I
One of the

Y

underwriting
Check List
experience in assisting
issuers may be helpful to
you. You are invited to
call

discuss your
one

of

our

at our

offices

Specialized investigating

Y

Our

or

Experience in formulat¬
ing financing plans

Y

to

BROKERS

writing firms in volume
of financing

Y

Your

write

leading under¬

Y

DEALERS

Established

1868

staff

National

Coverage

and

distribution

Knowledge of all types of
public offerings and pri¬
vate placements

Spencer Trask & Co.

plans with

25

BROAD

STREET, NEW YORK 4, N. Y.

partners.
Members

Co.

Kidder, Peabody
FOUNDED 1865

;
-

'^Members Njw
•

-

Boston

Chicago




-

ALBANY

York and tAmerican Stock Exchanges

17 Wall Street,

New York 5, N. Y.

Philadelphia

New York Stock Exchange

San Francisco

NASHVILLE

BOSTON

American Stock Exchange

CHICAGO

SCHENECTADY

GLENS FALLS

WORCESTER

<•

34

The Commercial and Financial Chronicle

(2530)

...

Thursday, December 13,1956

Report of IBA Governmental Securities Committee
At the

Annual. Convention

45th

Report presented by Chairman Pattberg points out why "1957

of the Investment Bankers Associ¬
ation

of

America,

berg,
Jr.
of
the
Corporation
and

lenging

Patt-

J.

Emil

First
Boston
Chairman
of

tee, submitted

the

which may

of his

Report

Committee.

cessful

nullify previous improvement in

handling

be

accommodate

of

delicate market

current

indicates

developments

market's

their

customers.

In

addition, insurance companies and
savings- banks were net- sellers
during the period. It was up to

man¬

the

debt structure. Believes

our

ing the first six months of 1956 to

chal¬

a

authorities charged with monetary, fiscal and debt

our

policies" and, in particular, details future refunding

agement

Governmental Securities Commit¬

for

year

can

suc¬

government market to absorb

these offerings and to redistribute
them among other non-bank in¬

continual

vestors.

The

text

Last

of the Report follows:

ability to fulfill its important function in

May when this committee
were

concerning
economy

some

the

question

direction

despite tight

marks
of

manner;

and shows,

the

commercial bank loans increased $6 billion

money year,

to

a new

with

high, without satisfying all potential borrowers. Emphasizes sound dollar and

the

Federal

election.

ness
as

busi¬

level

jp r

be

a

the

there

economy

business

/

.

strain

a

"thin?

compared
and

Your

early

committee

however,, that the success
attained in performing this deli¬
cate task is significant evidence of
the money supply,

on

so

did

the

market's

continued

ability to

nearing

activity

expansion and

con-

to

new

heights of

pro-

policy

continued

toward
this

policy

the

directed

be

to'

restraint.

In

carrying out

Federal

Reserve

did

duction, employment and income,

not make "tight money," but,
rather, the System refused to close

The gross

with

pickup in

bile industry
and housing

national product of the

inflationary dollars the gap
third quarter was at the rate of between savings and the demand
$4*4 billion, a new high record; for capital. It is the responsibility
and the final quarter of this
jfear of the Federal Reserve to main-

_

Emii J

or

Pattberg, Jr.

would the soft

x'ewts^spread'9 V

Current Market Situation
With

.

,

struction, coupled with increased
consumer
spending,
drove
our

automo¬

(starts,

.

industrial

for

had

ed i cte d?

Would

policies of the
System
have

period.

if

.

off

many econ-

omists

The

Reserve

It is

war

prices in the government securi- fulfill its important function in an
been determined
without regard the limits set
by manpower, mate- ties market move downward. Be- orderly manner.
to political expediency. .;.
And riais and piant capacity, and with cause of the pressure of bank
The Treasury in 1956 shaped its
the economy did not falter.-.Inupward pressures developing on" sfelling, yields on governments in financing operations to a market
stead, the record breaking outlays the price level, Federal Reserve the short and intermediate ma- limited in
scope by the expanded

Presidential

Would

history.

IS

coming

the

feels,

possible
implications
the

of

that

postwar

improved debt management objectives.

and

trying periods.
today only

market

the

of

In performing this task,
Treasury market went through

some

reported to you at White Sulphur,
there

orderly

an

turity areas have gone up more demand for credit and capital in
than those on longer bonds. On the economy and the restrictive
occasion we have had a rattier policies of the Federal Reserve
strange yield curve with two-year System.
*
•»
obligations yielding the same as
During the year, the Treasury
seven-year bonds. The spread be- refunded over $31 billion of ma¬
tween yield on long-term U. S. turing marketable debt, exclusive
Government bonds and high-grade of the regular weekly maturity of
corporate securities widened as Treasury bills, and sold more than
•

^ expected to exceed any similar tain a stable climate for business nc-w Treasury financing was conPeriod in our history. In short ... to function in. Thus, the money fined to short-term maturities
succeed in 1956 is a boom year'
*
' - market has functioned virtually while the supply of new longof the pressures of "VDuring this period the savings on a natural supply and demand term corporate issues continued at
campaign?
And of the country could
not keep basis.
The
reality
of
"tight a high level,
Would the Federal

Heserve System

in-managing the

$6.y2 billion of

tax certificates and

special issues of Treasury bills to

nation's money supply

meet

Leeping clear

Although these totals were siz¬
able, they were much smaller than
they would have been, and Re¬
quired fewer offerings, had not

the

election

Pace with the demand for money, money" became apparent as the
Lending institutions, already ex- bond markets declined, interest
fication of official attitudes about tended by the expansion of loans rates rose and borrowers generdebt
management
policies
that and investments of the past two ally had to adjust their financing

finally,

come

would

signalize

the

some

election

out-

were

developed under the Renub-

iican

Administration?

Most

of

these

★

★

years,

thus faced further demands

Kepiib ^ ^

questions

-since been answered.

have

^

accommodated

The election

by

on,y

be

plans

to

★*★★★★★★★★★

lifted

year

■

•

ALL

ARKETS

the

of borrowing on morthas increased and although

stipulated

VA

on

difficult to find buyers, even

and

¥

flected

¥

DEALER BANKS

*

RAILROAD, PUBLIC .UTILITY, INDUSTRIAL,
CONVERTIBLE, AND FOREIGN BONDS

¥

scarcity

The

that the

fact

★

★

¥

by

AA

of

REVENUE BONDS

¥

*

longest
much

as

mercial
to

*

*

cash

1956

in
was

surplus in the spring of

which

permitted

the

Distributors

—

De a le

SECURITIES

than

the

issues

have
110

in¬

basis

banks

losses and the

declined

year, .com¬

their

Langley & Co.

Members New York Stock

as

115

hard

were

of

care

W. C.

Municipal issues

Broadway

pressed

•

Tel.

Exchange

New York 6, N. Y.
BArclay 7-8800

customer's

requirements.

Though much
has been said concerning the dif¬
ficulty of borrowing money, com¬
banks

by

did

about

increase

$6

their

billion

to

a

high in dollar amount* and
the highest ratio of loans to de¬
posits since the 1930s.
This oc¬
new

,

■¥

¥

LISTED AND UNLISTED
PREFERRED

¥

curred

AND COMMON STOCKS '

¥

★

★

★

¥

„

¥

¥

MABON & CO.

¥

during a period when there
only a small change in the

was

¥

¥

equal

¥

-

NEW

it

is

¥

"¥

AMERICAN

115

Broadway, New York

STOCK

STOCK

6

¥

¥

EXCHANGE

•, Telephone REctor 2-2820

that

be

MUNICIPAL

SECURITIES

banks

many

more

additional

AND

selective

in

Simi¬

loans.

larly, savings banks and insurance
sell

to

★★★★★★★★★★

U.

S.

governments

against

loan and investment commitments.

lending

erations,
.occasion

were

institutions

ket

were

*

moved

as

Laurence M. Marks 8c Co.
MEMBERS NEW YORK STOCK EXCHANGE

j

AMERICAN

on

STOCK

EXCH ANGE

(ASSOCI ATE)

unable to supply all

able offerings in the
Just




now

potential borrowers and

¥
★

RAILROAD

se¬

In spite of these large scale op¬

¥

-

¥

★

government

companies have found it necessary

EXCHANGE

Bell
System Teletype NY 1-2152

obvious

making

MEMBERS

YORK

of

amount

curities, many at a loss. In doing
so, they reduced their secondary
reserves, that is, cash and govern¬
ment securities, to a point Where
must

Established 1892

INDUSTRIAL, PUBLIC UTILITY,

amount of

deposits of the banking
system and was accomplished pri¬
marily by the sale of an almost

postponed
bank

upward

on

some

capital
or

siz¬

canceled.

lending

48

WALL

STREET,

NEW YORK

5, N. Y.

mar¬

rates

account of .the

TELEPHONE HANOVER 2-9500

and

Similarly helpful

de¬

by

points.

seven

take

loans
*

Underwriters

investible

new

on

governments

mercial

¥

the

much in

maturities

:

re¬

these

of

bonds

more

30-year bond.

a

loan

MUNICIPAL, STATE AND

than $5 bil-

years.

of

INDUSTRIAL and MUNICIPAL

illustrated

yields

corporate

creased

.

extent

be

rray

Throughout the past
★

consolidation

so

extension

PUBLIC-UTILITY, RAILROAD

securities

showed comparable

¥

more

iion 0f government securities dur-

debt

dis-

'

*

had to liquidate

of

way

have indicated, commercial banks; prior

points since early in the year, a
price decline of some 18 points on

"K

Treasury achieved

the

municipal

corporate,

the

clines

of

of

government

funds.

TO

the

unchanged, it has been

J, when offered, at substantial
>*7! counts.

¥

DEALERS, BROKERS AND

rate

;

COMPLETE BROKERAGE SERVICE

market, the whole story of the
"tight money" year was not just
As we
one of fluctuating rates

has

Prices

*

*

;

securities

and

guaranteed- mortgages

FHA

more

CALL

ONE

government

to

cost

remained

ON

the

3%, the highest
The prime rate for

1933.

gages

¥

1"

requirements.

increased in two steps to 4%.

was

>

it

;

cash

borrowing from commercial banks
The

*

-

In general, interest rates moved

since

l

*

conditions

to
the
highest levels since the
early 1930s. Two increases in the

of U. S. Government securities.

*

*

changing

0f the money market. -

the liquidation

*
*

the

Federal Reserve discount rate this

★

Success of "Thin" Market

drastic modi-

seasonal

TELETYPE NY. 1-344

Treas-

'! Volume

Number 5594...... The Commercial and Finaneial Chrohicle-

184

(2531)
to pay off

ury

billion of debt

$8

during the first six months.

vestment of proceeds from thelsale
of their own securities,
pretty much

restricts
,

Increase in Short Terms

3

t

.

Because

l

banks
ment

commercial

ernments

securities, and also because

tions boosted one-year marketable
debt by about $9 billion to a total

$6iy2

billion, exclusive of tax
anticipation borrowings which in
.the past have not been offered

.

exchange privileges.

Tensions

into short issues.

Unless
tors

new

be

can

longer-term

1957.
ties

If

are

due

in

the

Treasury
place major emphasis

year

less, the

or

tion

of the

the

one-

Looking
;

•

:

ahead, the year 1957
problems in debt

poses formidable

management

-Ten

for

the

Treasury.
maturities, totaling

different

'

billion,

be refunded

'is
,

$40

in

the
are

paid off.
be

ury

to

the

In

the

amount

of

expected

some

of

the

gains

to

be

However, it will probfor the Treas¬

necessary

do

additional

seasonal

analyzing the, problem facing
Treasury next year, it is to be

noted

that

Federal
own

a

corporations

and

the

Reserve

System together
large percentage of issues
The pol¬

of

ernment securities for tax accruals

well

as

as

for

the

temporary in¬

tension

for

and

Emphasizes
Whatever

is

the

rate

Supply

.

Sound

Dollar

of

the

the

economic

Treasury
tailor

of

savings,

so

management.
celerate

im¬
im¬

be

fiscal

structure

The

the

to

policy,

ability
of

rate

measured

for

the

de¬

to

is

which

to

better

a

-supply

in

Nineteen

ties

fifty-seven
year

for

can

our

be

recognize that
consider

However,

factors.

challenging

held

at the

Hollywood
Hotel, Hollywood, Fla.

The

,

'

v

■*,'

'

•

Association
that

has

also

an¬

the

' '

v

SAN

'*

in

SAN

Co., 317

a

Borda

FRANCISCO, Calif.—Fred¬

erick

I.

Slack

are

Entwistle

45
of

New

cisco Stock

a

lose sight of

Thomas

Street,

York

and

DENVER,

Fran¬

E.

Reed

The

Distrit
istri button

■<

Noble

are now

with

Joins

have

Witter Staff

(Special to The Financial Chronicle)

become
,

LOS ANGELES,
Calif.—Theodore G. Congdon has become con¬
with

nected

Majestic Building.

632

Dean

Witter

&

Co1.,

South Spring Street.

GOVERNMENTAL

SECURITIES
Emil J.

In¬

High

Colorado Investment Co., Inc., 509
Seventeenth Street.

DENVER, Colo.—Oliver K. Fry
John

Colo.—Glenn

and James C. Marks

Exchanges.

With Sierra Corp.

and

Mile

(Special to The Financial Chronicle)

(Special to The Financial Chronicle)
.

Company,

Two With Colo. Inv.

*

affiliated with Sierra Corporation,

Respectfully submitted,
THE

connected with Allen

Center.

members
San

i

Colo. — Edward T.
Dorai F. Hazelip have

F.

with Dean Witter & Co.,

Montgomery
the

and

•

-

,

and

become

vestment
SAN

our

charged with monetary, fiscal

DENVER,

;

(Special to The Financial Chronicle)

it is diffi¬

sound economic growth.

authori¬

Dean

Co., 34 North First St.

Two With Allen Inv.

Two With Dean Witter

periods

ability to save and that
these savings are the key to our

connected with

now

&

(Special to The Financial Chronicle)

military and for¬

we cannot

!

JOSE, Calif.—Belmont M.

Witter

Montgomery Street.

ac¬

from

'

i

.

Reid is

FRANCISCO, Calif.—Rob¬

with Francis I. du Pont &

Dean Witter Adds

•

(Special to The Financial Chronicle)

(Special to The Financial Chronicle)

the fact that government spending
and taxes are a determining factor

balance

and

demand

'■>

,

determines

eign aid appropriations
viewpoint of economy.

indications that the economy

adjusting

between

We

cult to

markets,

there will
again
be
opportunities
to
sell
longer issues. Even now there are
some

„''t

*

will

savings

of international tension

at banks and in

money

capital

in

♦

large degree by

a

be.

off

Asso¬

be

*

ert J. Jensen has become affiliated

to

necessary

there

falling

will

.

*•

how much the government will
spend and what the tax rate will

a

Reuter

Two With F. I. du Pont

is an important fac¬
ability to increase the

our

shall remain constantly a major
objective of debt management. .If
is

Brian

and to successfully han¬
dle the problems of
Treasury debt

its

debt

America

1957,

Convention

Bankers

Spring Meeting
;
will
be
held
at the
Greenbrier,
Mellon National Bank & Trust' White
Sulphur Springs, W. Va.,
Company, Pittsburgh
May 8-11,
1957,
and
the
Fall
Meeting will be held Sspt. 25-27,
Rudolph Smutny
1957, at the Santa Barbara BiltSalomon Bros. & Hutzler
more, Santa Barbara, Calif.
New York
F.

economy

of

to

of

1-6,

Beach

prob¬

finance the further growth of our

the

provement

in

tor

and

Dec.

Annual

Investment

nounced

po- "

fanning

1957

the

ciation

New York

dollar

sound

market, it is
nevertheless,
that

portant,

icy of corporations to employ gov-

recognize that

of

The
of

of

Discount Corporation of N. Y.

•

international

must

aggravation

Announced

Herbert N. Repp

the dollar is the cornerstone
upon
which they must be resolved.
A

debt

*

that will mature in 1957.

explore

new

we

of

The
First
Nationals Bank
Boston, Boston

lems turn out to be, confidence in

refunding operations to the

demand

the

'

Demand

though the
necessity will have

of the year.

In

Yet

Bank
York, New York

L. Sumner Pruyne

be

Governmental
to

Meeting Dates

'

City

a

eco¬

would

Committee

•.

Even

mand

the

It

.

.

Balance

borrowing during the second half

-

national

our

,

National

New

^

prior

the

in
improving
structure./'
V / 'l /•:,
Better

in

made

years

1957

First

a

of

1957, tax anticipation

in

ably

in

billion).

of

1957 1BA Convention

Company

Delmont K. Pfeffer

and

Europe could require

tal .market

development
would
make future refundings larger and
more
frequent and would nullify

This

year.

the refunding

outstanding

billion

'.,$61/2
•

to

$21

first half of

"1-securities

!*f

during the

addition

to

the weekly cycle of Treasury bills

(currently
f amount of
'

expected

are

East

Russia'sk satellites

half inflationary fires.

represent almost

.

7 over

Middle

*

Trust

New York'

Treasury's marketable debt.

Such

part

Bankers

tentially a strong force for tap¬
ping the demand side of the capi¬

bal¬

'

Next Year's Treasury Problems

t

the

of r' the

„

crisis.

over $70
billion, plus seasonal borrowings.

would

in

in detail the tremendous
implica¬

loon from $61^ billion to
This

eastern

Securities

refunding issues in
all of next year's maturi¬
replaced with new issues

one

in

planning.
pointless of your

inves¬

marketable debt would

year

asked

again, and new
have to be solved.

nomic

short-term

on

policies.: Robert C; Morris

questions

Soviet

reappraisal

found,

will have to

the

problems may

in

.of 1956 maturities, into issues due
in one year or less. These opera¬

.

mar¬

change its maturing governments

.

of

of

net sellers of govern¬

were

.all but $2 billion of its $31 billion
•

short-term

/.debtv management

1956 may come
up

gov¬

among

in-

$19 billion of the maturing issues,
the Treasury was forced to refund

.

the

of

ket.
On top of this, the Federal
Reserve's policy has been to ex¬

banks,

and

the Federal Reserve System owned
.

to

purchases

savings

companies

!), surance

their

and

Some

35

COMMITTEE

Pattberg, Jr., Chairman
First

New

Boston

Corporation '

York

Robert B. Blyth
The National City Bank
Cleveland, Cleveland

Coast=to=Coast

of
•

Brokers in v

Milton S. Bosley
National Bank of Detroit

Detroit

Great] Lakes tor/t! le Gul f

Wendell

>

T.

•

*

' Stocks and Bonds

";

Burns

Northwestern

National Bank

of

Minneapolis, Minneapolis
Dwight

And Overseas

^

W.

Chapman

American Trust
San Francisco
F.

Newell

,

....

Company

-

v

'

~

Underwriters and Distributors

•

iondon

of

C. F. Childs and Company

PARIS

New York

Corporate and Municipal

Robert II. Craft
!

The Chase Bank
Jacksonville

James

The

'

Jacksonville,

Atlantic

"Stewart
.

C.

i

1

A.

J.

New
W.

;
i

National

Bank

of

Jacksonville

Dunn

Devine

*

Co.

&

York

Wayne

Glover

California Bank
Los

Angeles

Sheldon
!

The

Green

R.

Chase

Manhattan

II. Lyman

Bank

""

New York

*;.The

i

Securities

Cranford

A.

«

i

Greer

Fifth Third Union Trust Co.

Cincinnati
I f

?

;•

Ilardin

'

Members New York Stock

Underwriters, Distributors And Dealers In

Russell

A.

of

America, N.T.&S.A.

.

Preferred and Common Stocks

San

David

Brokers In

Francisco
M.

•

Commodities

I

Home Office: 61

&

Company

Broadway, New York 6, N. Y.

Illinois

Other




Asheville

Larkin, Jr.

Baltimore

Charlotte

.

Los

Denver

Angeles, Los Angeles

Houston

Ralph F. Leach

Company
New York, New York
Trust

*

Principal Security and Commodity Exchanges

We hare direct wires to the

Security-First National Bank of

,

Exchange and

-

4.

;

Municipal Teletype: NY 1-1691

•

National

Company

!

Guaranty

Members New York Stock

Telephone WHitehall 3-7600

Corporate Teletype: NY 1-865

following cities:

Chicago

Frederick- G.

E. F. Hutton

<

Kennedy

Continental

Bank and Trust

Bonds

jfet* .3/^4 S, JK 3/.

Z9

Kent

Bank

,

•

Savings Bank

Chicago

Corporate and Municipal Bonds

Stocks

Exchange

II. Ilawes

Harris Trust and

•

:

—ins *'

Childs

Pat G.

Morris
Northern Trust

Chicago

Company

of

Chicago

Detroit

/

Louisville

Fullerton

Indianapolis'
Nashville

St. Louis

Beverly Hills

Beaumont

Cincinnati

-

Cleveland

Galveston

Joplin
New Orleans

St. Paul

Grand Rapids

Kansas City
Philadelphia

San Francisco

Boston

Columbia

Seattle

Dallas

Greenville

Los Angeles
Pittsburgh
Utica

36

The Commercial and Financial Chronicle

(2532)

Thursday, December 13,1956

...

*

*

Report of IBA Railroad Securities Committee
Samuel

B.

Stanley

and of Morgan

mitted

Chairman of
Committee,

Payne,

Annual

the

made showing

& Co., sub¬
of his

Report

committee to the 45th Annual Con¬

from

'

held

America,

of

The

1956

been

has

in

follows:

text of the Report
balance

On

at

V

.

order to meet remaining capital

an-

relatively good year for the
railroads.
Gross operating reve¬
Class

of

for

lion

mil¬

$27

over

every

in

day

Net

year.

the
in¬

come

be

the

John

to the all-time

high

of

W.

namic

Barriger in his recent

American

re¬

it

presses

ported in 1955.

this

Economy"

way:

ex¬

other

"No

of transportation

means

tax

can

haul

much, so far, for such little ex¬
penditure of man-hours, of fuel
and of capital."
In spite of this
so

deferrals

sulting

re¬

from

amortization
Samuel

B.

Payne

of

relatively
earnings.

efficiency in the mass trans¬
portation of freight, the industry's
proportion of total inter-city ton
miles, after rising from 62% in
1940 to a World War II peak of
72% in 1943, declined to 49.5% in

defense

favorable reported

Unfavorable factors in the rail¬
road

picture have been well-pub¬

licized.

Some

referred

to

of

in

them

have

There

1955.

been

the

previous reports of

this committee.

are

indications

that

railways' proportion may have
that

hit rock bottom last year and

Out-moded regu¬

as

ation

are

stage

now.

fleet.

car

plication

•

Installation

of

modern

signal

systems known in the industry as
"CTC"

and

networks

ther

radio

are

communication

contributing to fur¬

transformation

railroad

of

These systems provide

direct contact between

dispatcher

and trains, enabling the traffic to
be moved with a minimum of de¬

lays. The

new

signal systems have

New

like to comment
favorable
In

for

the

year

Van

Fleet

of

the

basic
much

States

military asset.
a

earlier

General James A.
(Ret.): "The railroads

by

United

strength

few

future.

times it is well

to recall a statement made

this

would
a

part

of

of

the

are

a

the

service and

great

They are as
military

tions.

the

nation

as

none

reduc¬

expense

installation

of

large,

thoroughly modern yards have
speeded

terially

of these great

armed services could

The

large

our

Army, Navy, Air Force and Ma¬

rines, because

up

freight service by

reducing

switching

ma¬

while

tracks

practically eliminating traf¬

have

fect

Many who acknowledge the ef¬

tools to continue the increased

new

zation

raise

terminal

on

to

there

are

horizon

more

which

new

opinion

tools

on

expected

are

the

of

are

electronic

the latest products

data

processing and
computing machinery. Initial ap¬
plications of these machines have
only scratched the surface. There
is

hardly

a

phase

which will

not

fected

them.

by

these machines
tions

be

of

railroading

profoundly af¬
Not

replace

only
many

will
func¬

performed by hand and
repeated at many different points

tailed

work

definitive

required

traffic

in

and

making
revenue

studies.

sig¬

As

group.

a
changing industry in
which the application of new tools

is continuing at
impressive rate.
concepts

of

opportunity

to take

ment

challenge and

a

to

in

us

the

over

Railroad

students

have

dustry

the

stated

railroad

of

be

preciation
To

it

will

placement

railroads

that

new

to

will

New

R.

to

W.

confidence

Payne, Chairman

.

Bergmann

Pressprich & Co.

York

S.

John

The

Loomis

Illinois

Company Incorpo¬
rated, Chicago

un¬

in¬

is

Philadelphia

of

safety

found

comparable

other

in

W. Wendell Reuss

to

W.

E.

committee

Hutton
J.

feels

that

areas

im¬

will

Dick &

greatly to this restoration.

The

light of today's competi¬

Smyth

Corporation

York

Eugene Treuhold
L.

New

for

Merle-Smith, New York

First Boston

New

sional revision of the nation's pol¬

provisions

Co., New York

Ross

con¬

Henry G.

and

&

industries.

icy

actually

F.

Rothschild & Co.
York

SINCE 1878
Underwriters-Distributors-Dealers

Investment Securities
Brokers in
'X-

Securities

and

Commodities

•

New

American

York

Stock

Rights—Scrip—Warrants

Exchange

Stock

Exchange

McDonnell &ra
Established

11 WALL STREET

NEW YORK 5, N.

Y.




2-5000

Teletype NY 1-1110 & NY 1-1111

1905

Members
New York Stock

Telephone HAnover

-

many

tion within the industry, Congres¬

Members

.

C. Breck

New

limited

only

--

Tri-Continental Corporation

debt

of

SECURITIES

R. Victor Mosley

In the

Members

>/,

York

Henry

from

come

through sustained and

provement in two

ASIEL & CO.

for
and

is

Alfred

tribute

,

York

Charles L.

adequate earning power and

Your

situated

Morgan Stanley & Co."

New

balance

issues

have

Samuel B.

de¬

capital markets

investor

ten years

COMMITTEE

vast

Unfortunately

our

or

better

RAILROAD

earnings.

the

have

of

stock.

this

from

of

retained

and

as

while

Respectfully submitted,

Probably

generated

the extent

raised

half

over

will

sum

those

BROKERS AND DEALERS

the

is impressive.

in¬

facilities

new

the next ten years.
much

not

others not

well-managed roads. Their record

the rail¬

that

equipment and

over

some

considerably

close look at the figures

a

roads should spend $20 billion for
new

re¬

other compe¬

and

of

a

it

comprises

railroads,

done

the last five

some

banking business. President
M. Symes of the Pennsyl¬

vania
tent

have

an

invest¬

as

to always

us

116 different

which

re¬

investment bankers

better than average,

James

margins

"

money

have been dis¬

an

Challenge to Investors

nal systems and actual train oper¬

SERVICING

new

the
some

>

important for

some

Looking ahead to the future the
railroads offer

un¬

in

for

well. It might be worth your

A

more

**

their

of

member that this group

creased

*-<

capital
stock

common

is

and

Microwave radio control of

permanent
of

In this report we

the rail¬
picture today is that it is ba¬

now

en
route, but they will have the
capacity to do the volume of de¬

It is not

significant things about

to

substantially to further
growth in railroad earnings.

industry and

cussing the Class I railroads

sically

our

the

road

and

In

both

quirements.

few of the many ap¬

are a

of

portion

and

costs

increased utili¬

on

of modern engineering
railroading. One of the most

railroad earnings resulting from
dieselization, "push buttoif' yards

signals.

of today's
important re¬

most

a

investing public.

form

plications

and

CTC

appraisal

is

reasonable to hope that in the next
few years the railroads again will

of equipment.

These

fectiveness of these improvements
have
difficulty discerning other

the

railroad freight traffic and

on

less

-•«

y

.

general understanding for the

benefit

beneficial ef¬

important

an

access

B

\

'.•••■

investment bankers can and
should do to adjust our yardsticks

and

formerly moved all high¬
way.
The inherent flexibility of
this combination is beginning to

I

fic congestion.

and

terminal delays and have produced

long operate

'*

regu¬

require-

sponsibility of our own, and your
committee feels that there is much

sub¬

very

which

earnings,

installation

magnitude of change
in
railroading
techniques.
The
diesel has almost fully supplanted
the steam locomotive, bringing in
addition
to
its flexibility,
high
power
and low maintenance, a
whole new approach to railroad
operation. Long nonstop runs have
produced faster, more reliable

Factors

briefly on

factors

these troubled

Improvements

glance back at the past decade

reveals

committee

accountipg

we, as

congestion and

line

railroads

ap¬

The development of "piggyback"
operations, whereby truck trailers
are
transported on railroad flat
cars, is putting traffic on the rails

the effect of almost doubling

Now in the process of standard¬
ization of procedures and initial

Future

and

Adequate

experimental
successful

result in

may

capacity of main

iness.

A

Their

had

and

your

larly in its approach to rate

stantial savings.

contribute

directly or indirectly subsi¬
dized carriers, and higher
wage
and material costs are among the
more important.

the

in

the

in the future they will be able to
moderately increase their share of
the country's growing freight bus¬

Favorable

com¬

ownership

•

effects,

secondarv

latory practices, competition from
unregulated or losely regulated

Today

of strong,

and
operation of transportation mu$i
replace the outmoded policy now
in force which places intolerable
restraints on the system^ particu¬
lation

years some new

greater utilization of the

reaching

freight

basic

projects continue to contribute to
the

far
such

operation.

book "Super-Railroads—For a Dy¬

$925

Income

which

on

military value of railroads is

based."

close

million

characteristics

herent

probably

will

logistical

which railroads provide. No
form of transport, nor all

$10 billion, or
average

the

support
other
other
forms of transport combined, could
take over the job of railroads, be¬
cause they all lack some of the in¬
without

again exceed
an

An effective

New Equity Capital

will

railroads

I

private

capital needs will be raised from equities.

other

of

Hopes in next few

support

in

necessary

ments.

*

nues

balance.

.

capital market in

access to

are

national

new

come

depreciation and retained earnings. Seeks improved investors confidence

earnings and safety margin, and better railroad

it out

the national interest.

petitive,

half of this will

over

v

<

vention of the Investment Bankers

Association

the industry should spend $20 billion in next decade for

equipment and facilities* and that probably little

*

Hollywood, Fla.

carrying

Railroad Securities Committee, headed by Samuel B. Payne, reveals estimates

Securities

Railroad

120

Exchange

—

American Stock Exchange

Broadway, New York 5, N. Y.
Telephone: REctor 2-7800

Detroit

•

Asbury Park

•

Chicago

Volume

Number 5594

184

,

"(2533)

The Commercial and Financial Chronicle

.

.

"

William

of financing the services

M.

Adams, of Braun,
Co., Detroit, Chair¬
man
of the Municipal Securities
Committee, submitted to the 45th
Bosworth

Municipal Securities Committee reveals municipals sold in first 10 months of

&

is

this

Annual Convention of the Invest¬
ment

the

annual

along

with

tached

-

the

it.

to

1957

Florida,

Committee

text

appendices

Federal

recent

at¬

ponement of a

of

American

and

suits"

sold

this

much

of

first

months

the

believe

We

large
indicates
the

done

work

that

facilitate

to

Wm. M. Auams

will

of

mined

much

can

to

be

of

the

issue

this

next

that

record year for

pal financing

year

be

may

issues.

bond;

have delayed

r

^

■

"Nuisance

costs

and

for

-

',/•

the

may

the

caused

a

the

■

A

model

Law

Liaison

IBA

prepared

Committee

TABLE I

"*

10

(1st

(12

months)

,

months)...

1954

(12

months).....

1953

(12

months)

(12

months)

1951

(12

months).....'.....

1950

(12

months).....

1949

(12

months).....

1948

(12

months)

1947

(12

months)

1952

of

Revenue Bonds

$1,370,278,445
1,732,414,450
3,214,831,100
1,557,887,369
1,463,350,500
.730,095,200
599,923,200
V 632,953,250
549,501,600
385,690,800

$3,308,231,225
4,244,089,370.
3,753,810,796
3,990,640,799
2,937,966,967
3,278,153,053
3,093,680,965
2,312,471,799
2,440,230,349
1,968,080,762

-

-

"

-

t- Total

*r.;

$4,678,509,670
5,976,603,820
6,968,641,896
5,557,887,369
4,401,317,467
3,278,153,053
3,693,604,165
2,995,425,049
2,989,731,949
2,353,771,562

-

-

.

•

,

of

Policy

45 years

of

delivery

of

state

which

:

Ap-

'•

_

"

to

.furnish

'

governcertain

the

various

as

governmental

area

units

Plan¬

of

Officers

Finance
the

of

U.

Public

Adminis¬

:>1 •'

Governmental

Nv.

tute■

'

_

of

The

Board

v..

;

Council

resolution
order

recommending
standardize

to

the

Metropolitan Regional Organizations ; :
Department of
Political
Science of Michigan State Uni¬
versity
L'VVi
.

Government

•

Affairs

Founda-

;V tion.
The IBA

Conference by

represented at this
Mr. John S. Linen

(Chairman

a

was

of

special subcom-

Continued

and (3) the means

on

page

Investment Bonds and Stocks

that,
prac¬

tice

regarding non-litigation cer¬
regarding municipal ob¬
ligations, (1) each notice of sale
tificates

-

purchase

or

provision

contract

include

that there will

a

be fur¬

nished by the issuer a non-litiga¬
tion

certificate

dated

of

as

in

the

specified form
of delivery

date

and payment of the bonds and

(2)

that such non-litigation certificate
include a statement that "there is

litigation

no

knowledge

of

pending or, to the
the signers there¬

of, threatened affecting the val¬
idity of the bonds." This propo¬
sal was considered by the Com¬
mittee at its meeting during the

the IBA in
proposal
was
a
special committee
chairmanship of Mr.

Spring Meeting
May,
and
the
referred

Under

to

the

Cushman

(Pressprich Co.,
York).
The report of that
special committee will, be pre¬
sented
during the Annual Con¬

Municipal
American

institutions

are

avail themselves of our

invited

tion

services.

of

in

Dealers and Underwriters
■

'

-

•»'-

1

■

■

'




Dallas

if

at

least

one

Securities of the International Bank for
Reconstruction and Development

of such

signa¬

Canadian Bonds

Underwriter
New York.

can

Chicago
West Palm Beach

•

Foreign Dollar Bonds

required thereon is manually
This model law has

subscribed.

already been adopted, with some

NEW YORK 5, N. Y.
Cleveland

Philadelphia

San Franc!jco

ture

Bankers' Acceptances

would

securities by au¬
of facsimile sig¬

execution

Casualty, Fire and Life Insurance Company Stocks

the

use

the

Utility and Railroad Corporations

variations, in Alabama, Colorado,
Louisiana and Texas. The Ameri¬

of High-Grade Securities
Stock Exchange

Members New York

SIXTY WALL STREET,

Boston

Hutzler

of

simplify the execu¬

public

signatures

Salomon Bros. &

Association

Bar

thorizing the
natures

Section

Law

facilitate and

Public

Bank Stocks
by

the IBA Liaison Committee of the

to

State, Municipal, Revenue and Housing Securities

Bonds, Preferred and Common Stocks of Industrial,

IBA.

the

of

Another model law prepared

Financial

and its Instrumentalities

McGee

TCew

vention

Securities of the United States Government

of

Bar Association also endorsed

adoption of this model law at its
meeting this year when it adopted
the following

resolution:

Philadelphia

Distributor

•

Boston
:

^

of

of

Municipal Fo¬
of New York in May adopted

Insti¬

Governmental Research Asso¬

ciation

the

of

;

Affairs

an

certificate.

and

S.

•

Institute

beyond

transportation,
water, sewers, schools and police
and fire protection, (2) the divi¬
sion of political authority among
such

within the

•

tration

extend

Managers

"y
/, .y;
Public Administration Clear¬

,

appropriate

the

mental•//unit
services,

Municipal

Canada

developments.-.,
metropolitan area

created

••'*

City

Institute

Association

These

limits.

(1)

,

Institute

American

;

problems, including determination

of
i

.

Associa¬

unqualified approvlegal opinion and a non-liti¬

ing

gation

in

and

■'

Bankers

purchasing dealers, there be

furnished

a

over

i!

^

municipal bonds by the issuer

rum

for

:

,,

v.,M

are' a' number of in¬

the'.time

Governors

Our Steadfast

"

ing the practice of requiring that,

to the

A

Association

ners

at-

are

Bar

ing House

areas

city

affecting the
,

n

con-

Association

*

-

during recent years involving serious questions regard¬

and

^

above

Appendix

as

proceeding

.general; problem.

<s -h/\

This

Municipal Associa¬

International

final

,

the

of litigation

at

Tax

(2) Metropolitan Area Problems

have

'nf 1 rfnlirtv*

Lansing,

V
American Society of Planning

vital interest in such

to

American

Officials

Copies of the two model

pendix B.

pro-

a

referred

tached

to

tan

fc-F

National

a

tion

adjuquestions which

all

2

East

solutions.

Investment

associations

other

of

matters.

laws

cidents

General Obligations
1956

1955

expeditious

at

tion

We
attempted to enlist the

also

which have

validity of such securities.'!; " '
'

supplied

have

we

The shift of population from
rural areas to cities and the spread
arise in connection with of population out of cities into the
validity of proposed state suburbs have created metropoli-

Parts

the

the

legislation committees, and

support

municipal bond issues and
which will.permit the consoli¬

by the

of

alternative

American

;

dation of all suits

growing

•

.

have urged them to attempt to

have

and

„

reflects

years

judicial

a

.dication

j disputes regarding the obligation

-

•

10

in

i

laws in their respective states.

•>

recommends

29-May

held

was

problems and to consider various
.

,

?btail? a,doPtion of those model

legislatures the enactment

vide

suits"

we

its meeting in Dallas
when it adopted the
>

April

lems

of both of these modeUaws

group

As-

Bar

,

Conference On Metropolitan Prob¬

nicipal securities committees and

greatly by

°!,legislation which,- will

:

past

right
of an

at

year

state

municipal financing,

the

assisted

American

Bar Association

problems has been litigation chal-

volume of munici-. increased

Thet increasing volume of
nicipal
underwriting
over

On

to members of all IBA group mu-

"RESOLVED, that the American

.

lenging the validity of municipal

a

be

the

ye&r

copies'

Efforts

following resolution:

.

cate

of

sociation

'

issues at the recent election indi-

the

validity

of. municiPal bonds.

action

This

would do much

the

area.

cies.

signature."

manual

one

filing of nuisance

protecting

law should

removing

past

heavy demand for new financing
reflected
in-approval
of
bond

while

;

signatur^- and at least

simile

validation

We believe adoption

challenge

fi-

The! dures. As the volume of munici¬
10 pal underwriting increases, the
ob¬
years is shown in Table I.
- importance of removing legal
The
and
postponement
of
large stacles
simplifying
proce¬
dures will also increase/;,..-:',/
amounts
of municipal
financing
until next year and the apparent
One
of
the
principal
legal
each

for

single

a

to minimize the

exceed, the volume for 1955.
volume

in

of this model law

suits

municipal
by

by

proceeding.

legal, obstacles and
.mechanical
proce¬

unnecessary

simplifying

to, or

would

of

Securities

nancing and
of'such financing

for;

year

some

below.

to"mlnimbsrthe* cost

total

volume

of Public

tion

that

and

summarized

are

Legal

of

and

Association

Bar

:

that

"RESOLVED, that the legislatures, ference was sponsored by the folof the respective states be urged
iowing organizations:
'
to adopt statutes which will au¬
Council of State Governments
thorize the execution of large
National Municipal League
public bond issues with fac¬
Section of Municipal Law of

the

of

*

of

needs

the

Michigan, to analyze some of these

,

Section

the filing of "nuisance
requiring that all suits
relating to the validity of an issue of municipal bonds be
deter¬

and Mechanical Prob¬
lems; Nuisance Suits; Execu¬

(1)

has

year

Committee,

them

dur¬

the

.Law

minimize

aggravated some old prob¬
in municipal financing.
Ef¬
forts
to -remedy
these problems
constitute

ing

be close

problems

new

mu¬

ties

the

some

lems

'

of

nicipal securi¬

10

Mumcipal

How-

there are many common facand the problems can certainly be resolved more simply
through
cooperation of various
interested organizations and agen-

tax-eXempt-income privileges to shareholders.

which

facilities

new

has. created

municipal

this

for

demand

to these prob¬

answer

tors,

amortizing tax-exempt-bond premiums held by

...

„

ever,

to

beyond city limits;

.

,

financing, the

been

and extension of metropolitan areas

program,

and pass

large volume

issues

*

dealers, and making it possible for investment firms to purchase munici!

ply and the resulting low munici¬
pal bond prices during most of
the year have
caused the post¬

state and

i

may

municipal financing. Offers recommendations dealing with such matters

college housing

as

Although the tight money sup¬

new

make

the impact of various

as

single

no

provided

It appears that there

area.

lems, but that the solution in each
metropolitan area must be tailored *

'

of the Report and the

amount

statutes

exceed $5,-1

may

and postponed 1956 transaction

year,

The report discusses such topics

year.

Report,

appendices follow:

of

record

a

upon
The

$4,678,509,670;; estimates this year's total

totals

year

976,603,820 registered last

of

Association

Bankers

America,- at Hollywood,

the

in

37

Pittsburgh

Cleveland

•

Dealer
Chicago

San Francisco

82

33

(2534)

The Commercial and Financial Chronicle

.

.

Thursday, December 13,1956

.

Report of IBA Public Utilities Securities Committee
Harold

Dillon,

H.

of

Young,

Union

Eastman,

Securities

&

»

port of the Public Utilities Securi- ;
ties Committee, of which he was ;

Chairman,

to

Convention

Bankers

the

of

45th

the

Association

Investment

The

text

The
its

ues

there

no

future

march;

although

be slowings and/turn¬

on<*

doubt

can

of

society is

the

that

Forecasts

sure

(in

Millions

of

prognostications of expansion
quirements:
/■
V-

Year

Generation

1957

1,834

703

greater

1958

2,227

80.9

1959

2,344

884

I960.

2,428

919

In

1965

2,944

public

1970

4,237

mar¬

kets and high¬
er standards

living.

the

$1,493

utility

indus¬
try the factor

Gas

A

growth—in

demand, in

pacity

the

ca¬

and

ifi

in

Harold

National

suspect,

Product,

but

also,

other

most

of

we

industries

Table

of

I

this

report,

we

present in capsule form the record

excess

of

1955

recent

past.

these statistics

electric utility

we

Summarizing

note that in the

industry, kilowatf-

fiour output of energy has doubled
since
riod

1949

ended

similar

over

period.

the

pe¬

ad¬

an

preceding

Likewise at Aug.

31, 1956, installed generating caparity

recorded at 118,010,526

was

kilowatts representing
crease

more

sion,

over

a

direct interest to
new

7.3% in-

a

>.o,

Aug. 31, 1955.

money

Of

our

even

profes¬

17.3%

exceeded

the

last

billion

for

the

billion

amounts

entire

top

on

of

Peering

into

the

gas

transmission
tire

high

new

of

$1.6

the

1946-50

cus¬

in

serves

The

year

nearly $5.3
over

billion

en-'

at

by

the

This is

of

average

compares

a

with

're-

ported expenditures of $1.3 billion
in 1955 and $1.0,.-billion in 1954.
The A.G.A.
celeration
an^

predicts

in

over

further

ac-r-

capital expenditures.

estimates

billion

a

an

ae^rp^afp of $56

the next

three

securities

new

as

com-

pared with $2.4 billion in 1954.

23.0
21.4

1950

268,860

62,281

18.9

1945_—

180,926

41,560

18.7,

part to the problems of financ¬

1940—

125,411

16,426

11.6

ing modernization, there has been

1930___

5.5

further reduction in the number

86,108

5.003

1920_—

37,716

1,689

4.3

third

in

a

of

This

in the decade.'

independents

with

Due;

4,714

1946.

We

Total

plant

investment

was

$1.5

up

and stood at $17.8 billion at
year-end. Operating revenues were
$6.0 billion for 1955, an increase
year

10.8%

(See Table III.)

At

power

Ameri-

•

Tel. & Tel. and its subsidiaries",

can

raised
No

than

more

estimates

of

$1,200

miliijn.

future

telephone
requirements
come
readily
to
hand, but it can be imagined that
little slackening will take place,
■
'
%
Growing Utility Service-Demand
.

.

Without

.

.

power

independent

service

companies

we believe the point will
be accepted that demands fqt;util-

^nueU.grew;

of

and

the

48,-

Closer

con¬

ity

with util¬
opinions have

managements,

ulation and

tax

legislation,

might

At^L

r\r.

and

the

Publi"

to

the

have been

Industrial

pur-;',

been

course,
as

of
;

a

market for the
to

necessarv

to

purpose

become

has,y

W. E. HUTTON & CO.
Members New York

the

.soiraling^

and other

various

power

meet

will

Baltimore

•

Boston

Dayton, O.

Easlon, Pa.

Lexington, Ky.




Biddeford, Me.

Lewiston,Me.
Portland, Me.

the

t^at.

demands

everv

vacuum.

of the present

years

of

thoughtful
of

part

There is

a

an

-

-

•

•

increasing demand

■*-

^

..

„

RAILROADS

•

INSURANCE COMPANIES
MUTUAL

STATES

•

.

FUNDS

MUNICIPALITIES
v

1

-

AUTHORITIES

•

.

THE CANADIAN GOVERNMENT

PROVINCES

:

MUNICIPALITIES

•

FOREIGN GOVERNMENTS

b^r

can

be

issue

of

found.

up

the

power

from

are

Availab'e

BANKS
•

•

to

CORPORATIONS

DEALERS

excuse

to

Despite four
administra¬

The

Harriman

Guaranty

Trust-

Ripley & Co.

incorporated

.ce'"tpm-,

63 Wall
BOSTON

•

Street, New York 5, N. Y.
PHILADELPHIA

•

CHICAGO

this problem in detail.

The writer report1: thrt "in t^o p<\
years

•

•

INDIVIDUALS

for

Company of New York's "Survey";
pointed

Our Facilities

INSTITUTIONS

1933

to

1953,

'public'

increased from 6 to 20% of

CLEVELAND

•

DETROIT

•

very

on

the"

concerned.

Capital Issues

'

a

sent

situation

consideration
all -; peoole

public

tion, evidence of further encroach-;
ment of the State in the powerfield

Hartford, Conn.

BANKS-

of

various

requires

public

sayin<*

proponents
have

step into the

Columbus, O.

'

*x

service; the

Philadelphia

State

without

goes

unable, to

Burlington, Vt.

in-*
en¬

should privately-owned utilities be

CINCINNATI

"think '

we

utility commissions of the country
It

leading exchanges

NEW YORK

our

recently.

Stpck Exchange

which

append to this reoort

we

the

of

the

of

letter there is set forth

PUBLIC UTILITIES

copy of a letter sent to the Cha:r-

men

Chairmen

-.INDUSTRIAL CORPORATIONS

■

to

public utility commissions. In this

use

the_
utility securities so

meet

As illustrative of

deavors,
a

form

more

capital demands of the utility
dustrv.

the

-

Committee

rep¬

representatives of the'

our

in

our

and Dealers in the Securities of

V-

;

by Investors

to this report, men¬

earlier,
which

the

to

u

.

more

present.

invite soecial attention

we

letter

t-

f

utility!

investment community and to
influence rfor imorovm'*

since 1886

Demands

at

Underwriters and Distributors

Develop¬

Rico, to

ity commissions. The
vocative

relatively

reg¬

Commis-}

resentative group of public

of

financing-

common

on a

the appendix

Trust Co. compilation giving yields

company managements and to the1
chairmen of the s+ate public utU-.'

MUNICIPAL SECURITIES

but

q<X

"""t

policy, the

Service

ment Fo. of Puerto

and

stock with the feel¬

the

common

bo4s. 1,6%

c.

and
Exchange Corrmis-1
sion, to the Governor of Indiana'

sion,

CORPORATE

i

abandoned,

Thus far. t^e demand for utility
stocks has held up well

,

just, the

tioned

of 34.1% for Triple A

curities

.

•"

metier of

"

n^rvhir

nf

Committee sent letters to the Se¬

distributing

New

nf''lie*

hn"•

common

require detailed

detail

have

matters, and edu¬

In line with this

sued.

plans to meetsituation and in at:

advantageous basis

2J*nnn hll^A'*nnd

tacts have been built
up

cational activities

DEALERS

of

cost

capital, both borrowed money and
equity funds. This phenomenon is
he*""1 '-ut

be--

do at ar
companies have;

cases

be done

we

more*

We

plans to sell bonds in favor of sell-,

Your committee-has fol-: for Double A and 3-27% for-A
bonds.
The .same
averages
one
lowed its policy of attempting to*
year later, at the end of October,
influence the development of a;
satisfactory investment climate for'
W~ 7
nfn,'Ur eom.nfiue
bonds, 3.76% for Double A and
utility securities wherever an.op
m
A

portunity has arisen.

some

may

too well known to

a

financing

existing

closed

report':

our

the

least

that

the

on
on.

to be said for

market may

Some

ing

rH^iiccjon

further,

been expressed on

UNDERWRITERS, BROKERS

later date.

ing

record

burdening

the

what

on

altered

j

in

on

doing each year's financing as the'
time comes, rather than to gamble-,

to

Of course, one of the outstand¬
ing developments of the year iu^t
the rise

situation

rely more

permanent financing
basis later

advocates to step in.

was

the

to

lieve there is much

preceding year.-owned utility industry to expand
On the part of 406 reporting inde- because of inability to raise capipendents alone, financing last year tal can only encourage the public
amounted to $137 million.

face

to

tended

favorable

t'-'e

over

,

in

threat

severe

a

have

bank loans with the hope of doing

is

remains

for

reluctance
and

the private enterprise system. Default on the part of the investor-

^

1955, there wrie 8,461,-

telephones

as the,
financing rolls around.,
Some companies have shown more-

that "Creeping So¬
scarcely halted and
certainly/in the field of electric

telephone
billion -in the

they must each year

time

submit

cialism"

in

or

ever

Creeping Socialism and Rising
Capital Costs

on Dec. 31,1955 as compared with 5,983 at the same date

utility companies have
with financing plans
less irrespective of the

nually and, accordingly, pay what¬

still

operating
in

;

prevail.

utility, the telephone

industry, likewise shows continu-

000

and 78%

year

System.

monthly !

prevailing markets. They follow
the theory that with growth trends
as at present they
are faced with
the necessity of raising money an¬

Public

100,716

the Bell

gain of 6.5% during the>

,

Telephone Industry
The

%

125,884

years..

Financing in 1955 amounted to $1.4
billion in

Public

included

yield of 5.0% and an av-:
price-earnings ratio of 14.14

more

Private

Year

broad

a

proceeded

(million-kwh.)

7,640
11,263

1955

average

erage

Production

370,970

a

*

-

October,

price

Many

Electric

5,630

1954___

in

reflects

of

and

estimated

annual

and

the end of

the

ap¬

continues

American Gas Association.

ing growth.

future,

II

distribution

are

5,312
•

"

1955___ 420,520

industry for the

1956

year

1955

year

586

Construction expendi-

the

$1.3

and $1.7 billion for 1954.
-

in

-O

390

the comparable period

year.

raised from the

$1.1

enormous

3,045

increase of 15.1%

over

4,975

4,530

in

15.4.

follows:

259

3

yield of 4.7% and the av¬
- earnings
ratio was!
The same compilation at the^
of October, 1956 showed an!

end

figures

sion's Electric Power Statistics, as

029,000

now

of

few

4,320

239

June 30,1956, recorded a new high
of $5.75 billion for an increase of

public in the first 9 months of this
year

revenues

an

double

12-month

August shows

of 13.7%

vance

the

and

late

erage

by

prospect

a

$3,782

1.365

exists

Table

million.

in

show

1,719

1954, and for the 12 months ended

tures

the

29

saw

billion,

and

16%

us

2C3

1,865

industry

year

to

Let

220

2,024

than 800,000 new

more
a

in

rise

I960."

$210

$1,460

■

Industry

This

tomers

well.

.In

of

Total

-

Groyp

average

from the Federal Power Commis¬

1,261

expansion

shown

are

to add

t

sur¬

passing the rate of growth not only
of our population and the Gross

of

Miscellaneous

1.584

%

$619

industry and brief statis¬

gas

pended.

needs —per¬

sists

parallel

tics

investment

.'.; /

-

by C. A. Turner of Chicago had an

duced power alone rose from less
than y2 of 1% to 13%, with a fur¬

Construction

ther

Distribution

Transmission

in-

as

country's total output of elec¬
tric
energy,
and Federally pro¬

Requirements

vestment,

of

Electric

of

for

group of common stocks
in a compilation put out

the

re¬

.

Dollars)

1956

of

4.69%

and

.

encompass

expanded

issues

In

"Electrical World" in its Sept. 17,
1956
issue makes
the following

I

Group 1 issues, 4.46% for Group 2

freer flow of investor funds

to encourage

funds into utilities.

this

to

com¬

[ 4/v. 44://'' '■

economy contin¬

forward

may

ings,

handling of rights-issues should be

the end of October,

issues.

of the Report and ap¬

American

1955, 4.06% for the Group 2 issues ;
4.24% for Group 3 issues. At
1956 the cor¬

responding yields were 4.42% for

pensated; and examines suggestions
■

-

and

Socialism" is scarcely halted; believes

;

held at Hollywood, Fla.

pendix follow:

1

private

,

America,

age

utility service will induce further public encroachment, and submits, "Creeping

Annual )

of

preferred stocks showed aver¬
returns of 3.96% for the Group
issues at the end of October,

on

Utilities Securities Report estimates construction and financing
requirements
for electric, gas and. telephone industries; warns that insufficient

Co.,

New York City, submitted the Re¬

READING

on

Volume 184

the

Number 5594

investors

of

part

stocks which

r

fur

.

.

The Commercial and Financial Chronicler

in this matter and

utility

per-share earnings and dividends

the

over a

in

period of time. Straight in¬

come, even of a

which

ors

letter

attention

of

invest¬

hie

in

the

of

j The raising of equity money by
utility companies some times takes

to

form

issuance

of

stockholders.

The

of

to be

rights

sition.

Some

panies

have

of

have

and

provided

modest

pensation for dealers who

of

com¬

this

in

of

for

to

is

working

they

pay

should
'

1

-7

■

v

•

''

■

,

William M.

the

committee

of

to

mem¬

have

Committee

our

with

t^e

•

Public

junicr

people

investment

in

the

houses.

cooperation

highly

Tele¬

this

we

desirable

Cahn, Jr.

this

kind

and- hope

type; of liaison' work

Carl

H.

D.

Jones

&

Co.

Mericka

and

Co.,

>w

COMMITTEE

&

G.

&

Co.,

Incorpo¬

New York

Company

Dec. 1954
1951

1940-6

c'urities

and

Pipelines

(thousands)

$1,628 E

v

;

4,901

been

1,055
•

•

>

1!)57— *1,5)42

million;

1958—$1,145

million;

SOURCE:

"Gas

Facts"

and

TABLE
»

ate

Electric Produrt'on
(thous.

Generating Capacity,

ksvh.)

Telephone Industry

at Period End. (kw.)
;

*

Aug.
'

1956

589,452,837

Aug: 1955
Dec.

1954

Dec.

1911

Dec.

.

471,686,354

____

1949

Dec.

518,363,951

-

291,099,543 •"

*.____

-

118,010,526
110,029,299
102,592,410.
63,100,334

164,787,878

1929

92,180,273

TELEPHONES

:

-

•

Electric

Power

SECURITIES

i

Statistics,

SOLD

(thousands

Power

9 Mos. to

of

dollars):

Publicly
^
Subscription
Privately

$661,500

37,737

27,500

'__

'

$112,425

32,836

23,243

*

10,600

$177,701

$63,362

$90,660

141,254

Total New
SOURCE:

9,726,535

655,878

Money

Ebasco

$1,127,070

_

Services

|

definite and general

a

not

lower

universal)

6,440,847

ownership

This fact, in and of
not

seem

until

we

SOURCE:
S.

Statistics

of

(he

to

be

a

analyze the

Continued,

Independent Telephone Association.

'

qAllen

and

&

Revenue Bonds

Company

Established

Chicago

•

1922

CO.
NEW YORK 4, N. Y.

Boston

Cleveland

•

•

Philadelphia

Cincinnati




*

•

Washington

St. Louis

•

•

Pittsburgh

Son Francisco

the

itself, mighfc

cause

$952,407

HAnover 2-2727

in

for alarm1

reasons

for

Independent Telephone Industry—

.Municipal Department

Street, New York 5

to¬

total

the decreasing interest on the part-

State, Municipal

&

of

hands of individuals and a higher
percentage in the hands of insti¬

Inc.

C.J. DEVINE

(al-^

trend

percentages

stock

SfrecctUi<tf<i itt

48 Wall

to

results but af-'

tutions.

14,567,746

961,199

i

impractical

$1,084,905

>_

Total Financing

it

140,440

$1,131,096

1,795,029

U.

Subscription

ward

System

1946

$156,418

_

_

reveal

$15,799,247

gratifying

a

uniformity in
the
period:*

and

studying the returns we can
without1 hesitation that they

common

$2,042,822
____

any

though

(thousands of dollars)
Bell

of

summary

say

2,970,690 >
2,157,917

1949__ _I_______

Common Stock

Publicly__

$5,425,442
4,907,481

Independents

Lack
make

ter

-

We' obtained

tabulations

give

Bell System

"

changes in the composition.'

covered

{thousands of dollars)

$596,030

20,750

Privately

26,900

the

INVESTMENT

i.—

1'955
1954__

L

response.

201,170
PLANT

$697,387

$134,255

Subscription

years.

34,776

286,572

Preferred Stock

Publicly

45,044

4,825

526,109

Year-End

$743,779

to

1954--

67,150

;

System

their stockholder -list in recent"

1946

$592,500

59,779

1

-

pains to susbtanti-

as

1949_^

Mos. to 0/30/55

took

of

Independents

1955__

'

V

9/5MI/5G

we

our

48,029

REVENUES

Year-End

Commission.

more,

utility

6,086
i

_________

"

Lonj-Term Debt

Bell

;

1949__.

29,839,459

..

Federal

(thousands)

••v

1946__

the

7,998

19541_

'.■■•■

been

in

8,461

--'

-

<

Independents

1955

OPERATING
SOURCE:

INSTALLED

'Year-End

42,405,436
•

f

invest-,

impressions by asking a!
long list of electric and gas com¬
panies to furnish us with figures'

'

-

have

factors

of

hand, institu¬

equity market. Before writing thi,*

III

.

,

'

in-;

many

vehicles

investors

letter

:

Installed

as

On the other

tional

1959—$1,954 million.' "

Quarterly Report American Gas Association.

1

implica-'

bring it to*

that

rhent.

important

I

to

"

finding

are

stocks

mon

••

12 Months Ended

We

wish

we

have,

we

trend which may',

a

unfavorable

some

and

se-,

compa¬

dividual investors are becoming:
apathetic about public utility com¬

22,267

•

utility

attention.

!

Forecast of Construction Expenditures

.|

vitally con¬
affecting

connection

your

27,528
24,953

•

799

this

tions

27,954

1,462'

1,565

public

observing

have

29,190

1,345

3,052
2,228

of

nies. vIn

(millions)

________

is

the free flow of funds into the

$5,750

Avge.

Commissions

cerned with any matters

Customers

__.

Utility

committee

Our

Portland, Ore.

Construction

June 1955
;

Public

:

DEAR SIR:

Expenditures

!___

*

Company

Copy of letter sent to Chairmen c?

H. Martin

(millions)

June 1956

*

Milwaukee

APPENDIX

Becker

Pacific Northwest
.

;

Slezak

Edward

{
J
\

Milwaukee

York

rated,

Co., Inc.

Co.

&

San Francisco
G.

Total

Dec.

v

Schwabacher, Jr.

Schwabacher

•

Lemkau

Revenues

•

TABLE

Space

Company,
i

Albert E.

TABLE II

Respectfully submitted,

'

B.

Richard

Gas Distribution

/ 4

further extended.

articulate

Johnson

and

The

A.

.V^-'

•

Doerge

Wm. J.

is

be

Powell

Milton F. Lewis

Cleveland

that

can

Company Inc*

Morgan Stanley & Co.

believe

going

•'

M.

Hudson

York

New

PUBLIC UTILITIES SECURITIES

• i

James M.

Utilities

We

of

'

r

&

San Antonio

Denver

Johnson, Lane,
Inc., Savannah

12 Months Period

that

.

Dittmar

Boettcher

Thomas

Co.

;St.- Louis

r;^'r:y''' Electric Utility Industry

-

&

York

Edward

he

these

William C. Porter

Farwell, Chapman & Co.

cooperate

representing
The New York

The First Boston Corporation
"

Horner

B.

James M. Howe

Edward J. Costigan, Jr.

;

groups

George L. Perin

Weeks, Boston

New

New

function

mind

&

Scott, Horner & Mason, Inc.
Lynchburg

V-Henry Herrman & Co.

Association.

in

Thayer, Baker & Co.
Philadelphia

New York
Edwin

getting them

the

think that

we

become
'

.„

en¬

to
Our efforts ;

issue rights this fall.
dealers

Hornblower

New York

de¬

compen¬

were

unavailing but

the

and

Wallace M. McCurdy

Drummond,

Thomas B. Gannett

'Laurence M. Marks

.

&

Chicago

sociation of New York, a group of

on

phone & Telegraph Co. when
that

in the

Druramond
f

C. Brown

phase

Richard

Pierce,
White
Inc., Bangor

Co., New York

Committee of the Investment As¬

American

the

and

with
of

:

handling of rights.
strong presentation of

a

case

aid

thought

younger men.

the

our

were

this

with

the problem of trying to get more

learned

familiar

asked the

Handling

utility companies to

Carl

other

stressed

giving

acfivities

bers

We made

one

President Davis

has

of

business

worked

Compensation for Rights'

sation

the

With

function.

Committee

I.B.A.

more

any commission which may
paid to underwriters for their

Our

the

and

from

1

E.

H.

couragement to the younger men

com¬

assistance to the company in ob¬
taining the exercise of rights. This
compensation is entirely apart
be

just closed.

sirability

fact

are

Chairman

Dillon, Union SecuCo., New York

Clarence W. Bartow

com¬

Drexel &

committee activities

our

year

propo¬

public utility
recognized

fair

some

We wish to note

handling of

expensive

an

for

&

panies in the next year.

these rights by investment houses
proves

rities

handling these rights and the

Young,

Eastman

Theodore Birr, Jr.
only as our caseis pressed
First California
aggressively is there any
Company Inhope of getting our point across.
corporatedf San Francisco
We plan to make a
presentation Elwood B. Boynton
of our case to other
utility com¬
Hallgarten & to., New York

this report.

the

:

involved

expense

We believe that

spe¬

readers

Harold H.

of A.T.&T.

pensation.

We

.offered.

once

this

commend

cial

it

.

for

burden and

justification

good amount, does

not hold the attraction

bring to the at¬

tention of the officials

promise increases in

3&

(2535)

on

page

64

&

40

The Commercial and Financial Chronicle

(2536)

.

.

Thursday, December 13,1956

.

Report oi 1BA Special Industrial Securities Committee
In

in

made

novations

time

to the in¬

attention

calling

Committee's conclusion of

annual

the

report of the formerly titled "In¬
Securities
Committee,"

is based upon an

dustrial

the

to

ment

Invest¬

of

America,

at

i t

45th

s

nual

pete with electric

An¬

bituminous coal

an

assumption atomic

will

power

growth in next twenty

power

and petroleum products' capture of

gas

and long-term

near-

bright future

years;

combined,

large share of the

a

com¬

to

energy,

tion, held at
Hoi

lywood,

those

Edward
Glassmeyer of

heat and

Blyth

&

New

fuels; and likelihood coal chemicals will remain by-product

for many years.

York

that

in next five years to meet

mounting demand for

word

i

c

E.

Glassmeyer,

"s p c-

1"

a

and,

pricedp«:

t b

new

make

study

a

undergoing

of

industrychange and

an

dynamic
general membership-

possessing
interest.
'

Glassmeyer observed
that, "early this year, stimulated
by our President, George Davis,
cast

we

make

about

for

different

a

tribution

to

some

kind

our

a

con¬

membership.

I

that in prior
the report of the Industrial

Securities Committee consisted
statistical

a

year's

summation

issue

new

comments

activities

the

on

tivity of the

of

relative

industrial

of
the

and

recep¬

bond

and

stock markets.
"We
we

we

we'd

our;research

recognized
measure
our

be

different,

"We

used

in

within

largely

the

that

We've

on

Whereas

consumption

of coal

domestic

in

1956

was

approximately 440 million tons
that

increase

1980

by

to

this

will

approximately

tons.

Overseas,

dy¬

with difficulties.

deliveries

committee

proximately

60

be

from

change
the

stage

a

that

had

future,

not

to

our

take

decide

industry

promise

most

be

of

impor¬

broad

membership.

our

that

dynamic
of timely

great

and,

tant, that would
terest

of

therefore,

and

interest;
for

in

committee

the

met

It did

long

bituminous

all

these

in¬

to

coal

require¬

ments.
me

heading

dividual

mous

that

say

report is truly

report

estimate

mately

a

54-page

assigned to in¬

was

members,

although

is presented
whole.

this

committee effort.

We

as

have

an

the

anony¬

that,
125

exported.
of

1956

million

U.

1980,

million

From

tons

the

in

production

in

will

estimate
25 years

S.

through

time

our

reserves

practically
present

At the
of

inexhaustible.

economically

reserves

coal

total in

same

Table

to

your"

own

cision

those

to

as

benefit

will

conclude

your

companies that
from

most

will

be

what

be

we

growth ahead."

and

down

into

SECURITIES

Edward

>

New

(Table II).

Fox

F.

P.

New

significant

have

confined

The

of 200 bil¬

our

trend

in

Madison
,

Co., Inc.

New

Trust

ments

Company

of

In

electricity

mand,

of

electric

coal

as

fuel.

that

can

be

is

Both

of
to

by

these

I.

duPont

&

Coal

Co.

tric

report

at

electric
we

now

energy

produces

than at

more

any

at two

now

consump¬

estimate

our

utility

coal

have utilized

the

Federal

sion

elec¬

and

of

from

con¬

tinue.

York

a

have

coal-fired

the

that

will

increase
steam

Continued

previous

Commis¬

Power
assumed

New

page

York

N.

Kirkland

Jenks, Kirkland, Grubbs & Keir
Philadelphia
Thomas A.

Lark in

Goodbody & Co.
New

GRANBERY, MARACHE & CO,

Frank

York

A.

New

Members

Neiv

York

and Other

Stock

Exchange

Frank

Exchanges

Petito

Morgan

Stanley

&

Co.

Underwriters and Distributors

York
B.

Reid

of

Fulton, Reid & Co.
Cleveland
Julian

A.

Investment Securities

Space

Johnson, Lane, Space and

Co.,

Inc.

Savannah

Underwriters and Distributors of
■

*
.

#

LeRoy A. Wilbur
Stein

J

Bros.

.

,

&

Boyce

Baltimore

Corporate and

Excerpts
report

Municipal Securities

■

1

from
"The

on

the

Committee's

Bituminous

Coal

Industry" follow:

An

Analysis

of

the

Domestic

Carl M. Loeb, Rhoades & Co.

Market

Since

1946 the

character

domestic

NEW

YORK




PHILADELPHIA

market for

dergone

a

this

period,

sumption

dramatic

total

declined

-

coal

of the

has

change.

42

In

domestic

con¬

from

mil-

500

lion tons to 423 million tons. How¬
ever,

electric

•*

un-,

utilities

increased

their; demand from*69 ^million: to

<;

WALL

STREET

-

.

?

NEW " YORK

5,

(1)

come

generators

on

Kuhn, Loeb & Co.

Samuel

of
de¬

projec¬

Kahn

W.

pro¬

require¬

tion of national kwh output made

boilers utiliz¬

expected

which

present

75%

trends

energy

energy

from

years

times

arriving

future

of

of

all

been

have

electric

tion.

but also the increase in the

ing

York

Charles L. Hewitt

New

20

year

selling

of

summer

estimates
future

nation's

three

or

This reflects not only

generated by steam

York

Francis

during

thus

pipe¬

other off-peak periods.

requirements,

consumption

percentage

Haythe

Guaranty
New

gas"
or

of
the

necessity

ject the

tion's

York

Eastern

and

the

of

made

energy

&

may

storage

developed,

throughout

loads

"dump

the tremendous growth in the na¬

I

Fox

most

fuel

gas

equalization

months

consumption, both for the
past and for the future, is the rise
in
electric
utility
consumption

York

P. Fred

Northern

further

are

without

coal

Chairman

Glassmeyer,

in

as

line

follow¬

industrial demand.

The

competitive

boiler

as

alleviated

Various

Blyth & Co., Inc.

Gilbert
"We

the

Electric Power Production

COMMITTEE

gas.

ultimately

is

permitting

will

Respectfully submitted,
SPECIAL INDUSTRIAL

steadily

Markets

coal

*

costs

Natural

economic

gas

be

also

ing market groups: electric power
production, aluminum production,
steel, railroads, retail deliveries,

fabulous

a

broken

*

ac-;

The competitive pressure of

natural

breakdown

bituminous

for

rising

prices.

analysis of future domestic

markets

to

Finding

been

regulation

their

level.

sets

areas

de¬

own

combine

power.

have

fields

lion tons.

attempted

which

I

Potential

Future

Our

well

"" V>.

factors '

other

eventually could be reflected

seek

Reference

are

recoverable

excess

made

steam ;

changed to permit such prices to

we

that, by 1980—less than
hence—the U. S. produc¬

75% increase.

with

make

dustry—and

of

tion will approximate 875 million
a

is

coal

of coal in the generation

use

oil

Federal

mil¬

211

declined from

lion to 69 million tons.

study of the relative merits of
specific companies within the in¬

level

U.

of

commercial

or

Consumption

forth the year by year

we

be

83

tons,

25%.

to

could

.

-

the '

prices, which have been moving
up
steadily in the * field, could
register
significant
increases if

of the markets for coal.

approxi¬

tons

the

will

S.;

present

a

ap¬

approximately 500 million tons

tons,

"Let

Each

exported

In

boost.

17%

become

certain

note

electric

and

by Class I railways and for retail

member¬

our

from

follow

in west¬

that

tremendous

a

It is the hope

that

period
million

107

ex¬

that all its contem- *

in oil product

in¬

ship will read this report and, thus
stimulated, that each of you will

given the export market for coal

was

ing.

also

this

in

from

mills,

steel

to

and
many
pro¬
ducers in this industry are faced

Europe and its growing short¬
of power to create energy has

study of an industry to our
membership.
But what industry
should we choose? We wanted one

a

creased

750

•

the

postwar recovery

we

the

for

single

which

from 14% to
consumption. Coal
production of coke,

total

million

ahead,

growth

bitumi¬

looked into

even

the

industry.
We wish to
point out, however, that not all
coal companies will share in this

our

future.

ern

of

have tried to express

conclude

million

33%

coverage of

a

the '

celerate the trend toward increas¬

million tons, or

140

the industry; and
purposely
refrained
from
mentioning any specific companies

point of view.

industry.
the

to

have

large

from electric utilities and the steel

age

should present

back

in

industry, long consid¬
ered a depressed industry, is un¬
dergoing a vigorous recovery, clue
in large part to increasing demand

concluded that

we

fell

coal

nous

namic

name

study

a

but

sources,

we

own

by the in¬
sertion of the word 'special.' After
several
meetings our committee
our

original

as

able.

were

estimate

decided

changed

this

By its nature,
a good part of the material is fac¬
tual* or
statistical, and to that

to

way

of

need not remind you
years

make

to

has

expansion will be
'''• •/ ■'". '■'';... .

We

of

as

TVA

powered.

capacity

see?excess

the

plated

for

extent

Chairman

industry will again

goes

in

hydroelectric

major

customer and

approach the 25% level at which operations generally become unprofitable."

e

Committee's name, and past tradi¬
tion was discarded by a decision
to

lieves it "highly improbable that the

was

added

jr.

time

as

increase

reflects the virtual

of

largest

plant

capacity ; admits

new

that

financing problems persist despite spectacular productivity achieved; and be¬

the

share

steady

tric power

City, pointedout

de¬

installation possibilities except in
the
Far
West.
It
is significant

process

new

Report envisions investment need of $1V2 billion in

Co.,

steady

a

proportion of fuel-generated elec¬

market, and steps taken to improve coal's competitive position against

two

sources

generated—and promises

The

haustion

F 1 a.,

more

—

energy

despite

increase its

on.

Conven¬

power

decade

past

other

cline in pounds required per kwh

of natural

awareness

the

all

of power

substantially

not

in

than

analysis which includes; increasing demand from electric,

steel, and exports;

Bankers

Association

a

N. Y.

50

Volume

Number 5594

184

The Commercial and Financial Chronicle

...

(2537)

41

Report of IBA Oil and Natural Gas Securities Committee
Chairman

Gas

Reporting

Securities

Committee,

its

Association

of America, held at
Hollywood, Fla., its Report covering the industry for the current

able
and

Excerpts from the Report follow:
Your

Committee

to

the industry;

crude oil
tax

law

even

of

Dallas,

though Suez crisis

their

Oil

we

in

in a r

k

tained in
sented
Jackson,

Jr.

P

e

t

a

pre¬

paper
C.

•

re¬

con-

s

to
1

r o

the

e um

r
.
conterence on

Economics

Valuation

and

before

the American Institute of Mining,

Metallurgical, and Petroleum Eri.

.

on

fnrS'i

..

_

,

the tech-

bankers'

investment

role

of the risks inherent in
and accordingly offered

unaware

drilling

incentive to the oil

an

toward

man

raising additional capital the development of natural rethrough sale of securities to the sources. This tax feature of the
oil and gas industry has been a
public.
Conservation and proration stimulus to the operator whose
practices arising from the discov- development program has apery of the East Texas Oil Field in pealed for years to the construethe early 1930's first precipitated tive oil banker.
Even so, it has
the need for and the legitimacy of become quite patent that tax pres"oil
payments"
or
"production sure and the increasing cost of
loans." Only in recent years has finding
oil have precipitated a
natural gas come to the fore, and, tendency, if not a necessity, for the

in general, the same pattern of independent operator to sell out.
iencjing is applicable to that phase
of the industry.
Added
impetus to the use of
"production

loans"

has

resulted

an

objection¬

men!

made

mizes

the

recently quite epito¬
the inde¬

attitude, of

In

many
instances the capital
gains provision is the wiser cdurse
ta follow, particularly if wtw
fniinw
nsrH^isH,,
to
if further
advantageous intangible drilling

no

Estimated payouts and maturi-

'

good."

The Oil Payment
likewise play an important
role in the financing of production
Scarcity of cash and lack of
loans to oil and gas customers,
credit conspired in the early 30's
Somewhat as a common practice,
commercial banks have been *° complicate the affairs of man.
particularly in the development
prone to conduct oil and gas lendof the East Texas oil field.
The
ing for their own account within a
lease owner was often1 fortunate
payotft and maturity period of
five years. With full cognizance t° induce the contractor to accept
a
turn-key job for what became
of the aforementioned features of
known as the "oil payment." The
stability, it has been accepted that
Board of Tax Appeals has this to
some long-lived production,
desay concerning the oil payment:
spite depletion, could be worth
"It seems clear that the Supreme
in the open market virtually as Court regards any oil payment
much, say five years hence, as
right (a right to a specified sum

ties

at

present

neither

presupposing

PS' Presupposing

.

chanf?e

:n

.

aiiowahiA
,

nrioe

nor

P.

,,

•

f

°f money payable only out of a
specified percentage of oil or the
.

_

from the sale
an<* ^
as, an ^01^>r?ic ^
J

*as' March from the apparent inadequacy of costs seem remote. Should the ^1S engenders a rather progres- proceeds received
We are deeply in27M»% depletion allowance, depletion allowance be reduced or sive philosophy in the mind of the
01'» » as'

nw

w

5 " • 1956.grateful
debted and
.

to Mr. Ardrey

for his assistance and

cooperation

in this respect.
*

*

allowance

was

a

compromise

in,s an°wance was a compiomise
between the House and the Senate
in 1926.

*

This report might more properly

eliminated

WnnlH

nrpatlv

nnpratnvc

an

the

are

failures.

Congress

are

was

are

m

,

oil

m

place, the holder thereof

payout than five, and insurance
companies lend grfeat assistance to

nil

"Application of the Bank
since

e

banks

nHfdnaiiv

be titled

Business,"

B

unc0mmon. As for the being the owner of the share of
loan, it could be conceivably more gross income from production
attractive creditwise on a 10-year repre^nted^ by the^payments to

Loan

Oil

"

greauy not now

commercXbanks T-

It has been estimated that

81% of exploratory wells

that banker and longer maturities

dictates

reason

H

t

accentuated

dry, proached
and that 36% of all wells drilled rectly for production loans. Later,

in

to be

able cost to the borrower. A states¬

pendent operator—"If it is a Ques¬
tion of %% on the interest rate,

of

this

report his

do not appear

change removing Canadian act companies' disadvantage vis-a-vis

not considering

are

normal

f

De¬

partment, who
has permitted
us to incorpo¬
rate

stimulate Western Canadian

may

sales, and reviews shifting gas-oil picture in Canada, including the

niques of capital formation, or the

in
o

the very nature of the oil
business lends itself to the
use
Of long-term
if not father
constant credit. While attractive,
indeed, to institutional lenders,
the relatively high interest rates

money,
and gas

gas,

rapidly enough; and

sources

While all sound businessmen

then the deal is

Republic

ha r g e

gas

item of importance
of loan is the interest

must be unmindful of the cost of

U. S. companies.

National Bank

c

natural

uncover

Senior Vice-

e

rate.

oil problem is finding markets for rapidly increas¬

President of
t h

final

in this type

financing methods avail¬

recent

questions utility rate-base method's applicability to

failing to

warns we are

ing production,

indeed

was

in

being able to obtain
material and advice for this report
from
Mr.
Rushton
L.
Ardrey,

W.

maturities.

occurred

industry, the Committee rendering

gas

analysis of this sector discusses

current

believes CanadaV major

fortunate

year

.

year.

•

developments in the past

energy

competitively threaten the oil and

to

re¬

Bankers

Investment

the

of

significant atomic

The

leased to the 45th Annual Conven¬
tion

no

Oil and Natural

of the

industry in favoring the longer

the

William C. (Decker)
Jackson,
Jr., of First Southwest Co., Dallas,

not

more

as

field of oil

into the

entered

Continued

on page

financing, they actively

solicited this business. The invest¬
ment banker entered the picture
through the placement of oil and
gas loans, with' one or more insti¬
tutions, where this appeared to be

Underwriters, Brokers and Dealers

the
us

wisest

financial

in

of bank

The first

Utility

operator.

or

and Railroad Securities

We shall attempt to

Securities

in

this

that before

it

to

Municipal, Utility, Industrial

Equipment Trust Certificates
Department

say

advancing funds to an
corporation against

individual

oil

Suffice

report.

•

Bank and Insurance Stock

be neither technical nor statistical

Foreign

Co.

ORPORATED

Underwriters and Distributors of

type is the usual and

erstwhile loan direct to the oil
gas

and

C

Business continuous since 1890

Gas

or

Operator

public

IN

types

financing available.

Loan Direct to the Oil

Industrial, Railroad

Blair

Let

course.

consider the various

now

or

production

it

absolutely

is

that a field test be made
of the wells, and in estimating
primary reserves
the three
methods used are the volumetric,
the decline curve, and a combina¬

44 Wall

Street, New York 5, N. Y.

necessary

Burnham
MEMBERS

15 BROAD
CABLE:

NEW

and

YORK

AND

Company
STOCK EXCHANGES

AMERICAN

STREET, NEW YORK 5, N. Y.

•

TELETYPE

COBURNHAM

t'

Dl 4-1400
NY

1-2262

tion of both.

The decline

curve

is

usually the most accurate for it
is computed with experience from
past
production,
as
contrasted
with
entertaining necessarily a

Telephone DIgby 4-4000

Teletype NY 1-1109

Private Wire

New York

Albany

Boston

Buffalo

Kansas

City

System Connecting

Philadelphia

Detroit

Flint

Rochester

Chicago
Grand Rapids
Toronto

cautious attitude toward the

more

frequent whims and caprices of
new or prorated production.
Also,
of course, a prerequisite is a reli¬
able title opinion, without which
there is nothing to discuss.

UNDERWRITERS

DISTRIBUTORS

DEALERS

the

Once
and
sf

decisiort

amount

engineering
at hand

proper

opinions

legal

is

and

are

made

terms

as

of

to

the

the
loan.

In

Corporate and Municipal
Securities

reaching a conclusion, it itf our
opinion that the present worth of
the property should be the pri¬
mary determinant. Present worth

be defined as the future net
operating profit of the property

may

discounted
Established

R. S. Dickson & Company
INCORPORATED

While there is

Greenville

CHICAGO

NEW YORK

Asheville




Wire

to

table.

As¬

no

AX-EXEMPT BONDS
■a

thumb-rule ap¬

to the loan amount, we
practicable, in gen¬
eral, to apply a safety factor of
2 to 1.
In other words, $500,000
would be the usual loan against
such collateral value.
However,

Raleigh

Richmond

ratio.
factor

could
Direct

5%

plicable

there is

Atlanta

a

have found it

Members Midwest Stock Exchange
CHARLOTTE

on

the sake of discussion,
figure
be
$1,000,000.

sume, for
that
this

1919

RIPP & CO., INC.
Ti

all Offices

no

An

appreciably lower safety
the

in

be

sacredness in the 2 to 1

much

higher

tively

new

berry.

East

more

Texas

field

acceptable than a

one

in

some

rela¬

trend such as the Spra-

NEW YORK OFFICE:
40 Wall Street

HAnover 2-5252

76

42

The Commercial and Financial Chronicle

(2538

.

.

Thursday, December 13,1956.

.

Report of IB A Investment Companies Committee
*

Annual Convention

At the 45th
of

Bankers

Investment

the

business

Fund industry answers

Asso¬

at Hollywood,

ciation of America,

plans, types of fund buyers, impact of MIP, ard fund

distribution by Stock Exchange houses. Scores Commission's proposals

reaching attempt by the SEC: to

looked so good that
might be misled into
thinking similar results would be
The SEC's Proposed Statement of obtained in the future.
If, howPolicy Revisions
ever (from the Commission's paof the Report follows:

investors

(1) Question: What is the industry's
answer
to
the
SEC's
Decent proposed revisions to Statement of Policy?

mental

members

Bankers

the

the

of

a

?£YZ investment company what

Association

and not just
companies.
Commission's
proposals
be
the most far-reaching
attempt oy me

investment

The

oould

eFpifn

{J1® Past results

...

fta^J?e®2

had he purchased $5,000 worth qf
shares and accepted all of nis
capital gams distributions in addi-

oi<-»n'c

.

nmnncai«

wfuiiri

vnn

critics

by

^

in(}ustry

of

the

discounts

mutual

following

end 0:t June in

in

0f

the

1950 at
Korean

sales

Both

studies

that

proved

smaii,

purchases of portfolio

secu-

formation

of

in

testimony

Senate

before

1940

m

my

the

oewre ue
and -Currency

.Banking

gives

preventing thq

though

cePl such capital gains distributions in additional shares. For his
own £ood y°u withhold this in-

them

would

were

no

formation from him!

heaviest

infor-

mation

even

though

such
and

Protect

presented in
such
William

to

kmiself. '

Parker

A.

a manner

not

as

sion,

•pther

words,
to

seems

be

should

have

certain

this

accurate

and

aot,

se,

it

the

information,
though

even

toward

does

investors

information

misleading.

pass

be

it

protect

be-

(*eve that the Securities

Acts

are

disclosure

that

the

statutes

and

Commission and its staff have

long

(sales

securities

upon the investVient industry their own personal
views of what is good for the in-

iaken place
with

the

hearings
and from

SEC

staff

that

.

members-

based

gains
shares

and
...

to

on

similarly

investment

reinvestment

acceptance of

least in

was

"■

of

■

j

part by the thought

it

up

its

wished

is the view,. I
the ^present Comrnis-

of

However,

•

the

of

Federal ldw"

a

whiph, rule^ pn the merits of securities, but this idea may be im-

piloted .in certaip

jng

addi.

areas facilitat-

fVtu.re

s^me

transition from disclosure laws

,

motivated

what

This, also,

ment in passage

income

in

:»

(,icnal shares

to

danger lis
not that they believe'at this : no-

programs
of

gains

,

.

results

do.

as

sioners.

results

acceptance of capital
distributions in additional
and

mind

believe,

upon

—

systematic
based

investment

of

intelligent enough to make

at,

those

that

passing

any and

the

upon

merits

'|jc
to

shares

,•

expend*-'
.

$5Q

a

^

month?

-

.■,.v

sell

the

important

j

20%

cLnot

nmdoce

agement

of

given
been

their

total

uncommon

in excess of
sales: repre¬

by sales in excess of $25,A young salesman who con¬
his prospecting to men his

?wn age wil1 Prpbably find that

'

!hirpV?JagtpSaif

an<J that
f tenden^.to hava more
!
cumulative programs.
i" older a"d experienced sales,

?n normaJ'y

' m e larger
Jnay not be
better salesman because he is

man-

produce

a

calling

on

older

prospects.: The

difference lies in the
power"

of

the

"purchasing

older

several years, the Many

would

no

prospects.

longer

be

in

it

is

securities salesmen believe

easier

to

make

a

large sale

time

same

them

for

to

is

The very

market action that would

others to hoixi

their investment."
In

every

Underwriters and Distributors

demptions,

.

.

which

sales of

■

,

data

periods—especially- in
general

and

periods
liquidation —

market

mutual

funds

have

had

CORPORATE
Membzrs

Detroit

and

Midwest

Stock

Exchanges

balance.

on

Supporting

1936

SECURITIES

new

nioney available for purchase of
portfolio securities and have been
;

:

for

in

Luyeis

M U NICI PA L

re¬

providing
net1 addi¬
investment.. Even

cash

of

the

STATE,

y

mfnuai

new

exceeded

nave

-

increase

or

.

for

year

snaies

tional

cause

holdeis to liquidate-would

some
cause
-

FIRST OP^ichigax^Corporation

decide to liqui¬

date their investment.

figures ' for

1927-'

DETROIT

N^WYORA

CHICAGO

were

compiled- by the SEC;
1940 to date, compiled
by

from

Columbus

the NAJC.

Pert

of

Grand

Huron

Rapids

Battle

Lansing

Creek

Saginaw

Flint

Bay City

The "Load"

(3)

Question;, How

funas

juscuy

the

do

sales

mutual

charge

of

5'to 8%%?

Answer:

successful
'

municipalities
f

■

charge is
the

nation!

(Arizona), Jersey City,
Washington Suburban Sanitary .Dis¬
trict, Regional Planning Cbnimission of
Cuyahoga County (Cleveland), the City of
Houston and the City of Tacoma
all use our
uniquely complete
financial consulting services.
_

.

..

a

quarter century we have provided
governmental units with experienced counsel
in new financing, revenue

zation of

financing, reorgani¬
existing debt structure, over-all financial
planning and financial public relations.

To learn
we

more

<

our

services and how

link

and

<• !

about

municipality with underwriter
investor we invite your
inquiry,

WAINWRIGHT & RAMSEY Inc.
Consultant#
70 Pine Street




\f

on

Finance

essence,
the sales
distribution cost. It is

charge the consumer—the in¬

brought

within

his

pay

to have

reach

de¬

a

commodity

—

securities

—-

what for him is, the only rea¬
sonable and practicable basis. Jusf
on

as

New York

5, N. Y.

MEMBERS
New

York

Stock

Ex-hange

eggs become accessible to most
_

of

,

i

-

only when taken from the

us

henhoqse, candled, arranged on
maiket shelvps in
carefully de¬

.

Midwest

American Stock

Exchange

S.tock Exchange

,

signed

boxes'

labeled

brown

2G

or

Broadway, New York 4, N. Y.
'Telephone:

white, large, medium or small, so
many investors stocks become

to

.

:

-

HAnover 2-7900

Tel type:
NY 1-911

available only as
packaged by the
mutual fund
industry. 'This, de--livered

package gives

tor

a

(1)

fully

number of

screened

to

the inves-,

stocks

meet

care¬

his

RAILROAD

par¬

ticular needs;
(2) access to an
established management for \yhose

exclusive

services

he

could

PUBLIC UTILITY

not

afford to pay by

.

himself; and (3)
diversification, to. spread risk at a

lower
own

cost

than

if

he

picked his

stocks.

The

•

Vilas & Hickey

-

Suit River Project

For almost

In

a,

vestor—is willing to
sirable

throughout the

?—;

QpVpmi

-

funds

,

fW saI?s,?ven «"»«« »|f

l

Had

unable-to

the

000.

fines

the

even if its serv-

away.

of

of

.tannot produce, then the

aie

ov(M.

lhf

I

.

sented

nrobahlv

If manage-

—

excess of $25,000 in the;

"Over

than

*u_

industry has

nclustry.
1S not
among funds to have

it.

amount
is

:

all securities.

serving

a.

nor-,

w

..

you r:

-

of management.

,

ices

open-end trust would

an

iunu

disclosure, it is

Tne

wise

simultaneously

is available,

own

qf our industry, it is apparent that
the proposed ruling to outlaw the

showing

of

ers

own

dis-

was

who

inconceivable that all the hold¬

Corn-

the

1937.

was

fair and accurate

have

discussions

by

by

notion

investor

inSL1^! ^i,mainy mutual fun(Js

said,
sometnmg

what

charge)

lund 1S exPensive

such

.

withdraw their funds. But it

cussed when - the * 1933 Act was
being drafted and it was rejected,
The theory of the draftsmen was
that if you give .the public honest,

vestor to know and what is bad.

the

This

of

it

that

of securities,

endorsed

mission.

no

no

were

might decide at the

that,

should

investor* from his

an

'

in" this

•

period,

less

ment

open-end company are not
bank deposit. It is conceivable
that all the depositors of a bank

going to try to

you are

a.

a

mistakes, perhaps thesimplest way
is to permit him to buy only those

:^ight to impose

ji From

all, if

After

merits

There

or

an

conclii-

notion

occurred

aistriouiion

.

There

1929

a

brings home the bacon, then
the (sales charge)
no longer
looks so forbidding
If manage-

during the
liquidations

security

decline

proposals

Government

the

on

of

sort

some

Federal

be

We

per

the

of

the

ini-r^Icc.ame m
increased

.

ment

during the violent market

runs

could conceivably be the first step,

Commission
that

prospective

though

even

the
saying

Wot believe

its logical

to

adoption

in

pay

until

you

any

r'runs'oil

runs

j^^„j:

•

"

ranging

issue):

reason

place.

Thirties

ever

country.

from
*;

If carried

be

to

mio1eading. In

investor

the

tnat

take

such

early

that

In effect the Commission^ proP®sals are purportedly attempting

informationbe
accurate

the

slightest

Denef

tne

tor

the

pi

know

never

skill

that

misleading even
is true that he can acis

disclosure of
certain

indicate
Is; there

E^nS,fkei-ng

"Forbes" magazine
recently stated
in an independent review of the
funds (July 1, 1956

cities substantially exceeded sales.

Testimony

purchases

small, unless he felt

or

naxrar.

the periods of both breaks mutual costs
*neie

tIlis information because such in-

realm

g^y.

wisely

during

much

the

from

created.

'

DUrCflaSCS

amounts

wuuia

the

enforcing into

fog

lowering of the

results would justify:the
ture.
As
has
been
you

fun(t

a

to
1

cost, large

and

-

charge
apt

out
War

ILIIT16

volume

on

which result in

' every

agajn for the January 1955 break.

tional shares, under the Commis-

i1P-

p-ft

f

When foe-fo

prospective investor asks of the

purchase, and

F

in round lots has available to him

ui
whon

being

.

hiarket break since 193.7 and has

+•>

Investment

cura^e

•

given:

mally purchases $5,000, $10,000,
$20,000 and even $100,000 of in¬
vestment company shares to the
investor
is interested in sav-*

20
ac-

periods of rapidly fall- sale woulcL be about 12%. " The
ing stock prices?
; "
larSe investor who normally buys

buttons^ in additional shares and

t®11Cue'■ YuVeS##X'
What will be the effect.

among

price, the

same

industry

your

Plans

Statistics

^

forced to unload, large blocks.

asked

misconception of the Comwhich affects alt

divided

were

of stock in

ternalistie
could prevent showing the results
of accepting capital gains distri-

mission's duties
vhe

chase,

stocks of the

Question: Will mutual funds

(2)

by

shift

~

The Bear Market Bugaboo

resuits

pas|.

text

Investment

tremendous number of investment

of which he is Chairman.
The

of

Question:

pians

v'

growing

Place

(4)

out

beyond the law.

go

"

V

far-

as

being one of
industries in",

economy.

The

che report, "Answers to Possible
Misconceptions about the Mutual
Fund Industry," on behalf of the
Investment Companies Committee,

alone

fastest

Policy revisions, possibility of large-scale liquidation during bear markets,

sales charges, investment

Boston, Mass., on Nov. 27 released

let

the

the

of

Florida, William A. Parker, Chairman of
The Parker Corporation,

tinjely questions concerning SEC's proposed Statement

Wiesenberger 1956 edition
Shows that if $2,250', the size of
the

average

mutual

-

fund

pur-

.

.

.

.

BOND and STOCK

INDUSTRIAL
BROKERS

'

Number.5594

Volume, 184-

than

small sale.

a

..

.

The: Commercial and Financial Chronicle

has

The large In¬

cooperated

intelli¬
gent investor, accustomed to con¬
sidering the facts, then making a

of the

decision.

is

is

vestor

usually

more

a

in

(7)

Question:

(5)

How widespread

investment

of

use

any

New-York

jor

of mutual fund shares?

distributors

facts

that

are

67.6%

under

11.7%,

30-39

30

of

years

the

grams

the

in

were

bracket.

cumulative

of

95%

of

80%

New

York

offer

in¬

shares.

company

Bache

&

Charles

Laird,

Bissell

\

DETROIT, Mich.—Fred L. Davis

With Hincks Bros.

and

M. Werly

WATERBURY,

Distributors, Inc.

Mayette
with

Burns Elected Head of

has

Conn.

become

Hincks

Bros.

—

Buhl

Louis

Denner

Co.,

Building,

Detroit

associated

&

Robert

have

joined

the staff of D. B. Fisher Company,

(Special to The Financial Chronicle)

Boston

;

with

Two With D. B. Fisher

Morgan & Co.

Co., Chicago

Putnam Fund

is

Meeds, 44 Whitney Avenue.

the Los Angeles Stock Exchange.
Mr. Massey was previously with

Myron F. Ratcliffe

Inc.,

members

B.

the

of

Exchange.

formerly with

were

35-37 Prospect Street.

Stock

C.

Both
Mor¬

ton & Co.

,

30-49

National Bureau of

committee

■

William

A.

Parker,

Economic Research

Chairman

The Parker Corporation, Boston

of

Edward

S. Amazeen

Coffin

age

&

Burr,

Incorporated

association

to

search organization.

Boston

''

Adams

Nation's outgoing economic chief
returns

pro¬

:jY.p'Y.;'/'':

:

least

at

Exchange houses

;.Yy •'

in age

62.5%

programs.

owners

odd-lot
invest¬

&

Lord, Abbett & Co., New York

THE INVESTMENT COMPANIES

of those purchasing under

cumulative

Osgood

HAVEN, Conn.—Albert E.

with

Hill, Richards & Co., 621
South Spring Street, members of
are

Harry I. Prankard, 2nd

Respectfully submitted,

40-49

percentage varied

to

up

Stock

24.4%, 50-59 years; and
38.5%, 60 and over. As one would
expect,

securities,

vestment

years;

groups

L.

NEW

Carnevale

age;

21%,

years;

and

LOS ANGELES, Calif.—Fred H.

Boston

that after elimi¬

brokers,
specialized

and

general

egular

viduals

Robert

(Special to The Financial Chronicle)

Massey gnd Billy M. Montgomery

Wellington Company,.
Philadelphia

43

Joins Laird, Bissell

,

(Special to The Financial Chronicle)

ma¬

ment houses which do not deal in

accounts are owned by
men and 32.4% by women.
It fur¬
ther showed that 4.4% were indi¬
i

prove

floor

of

dealers

all

of

Two With Hill, Richards

Dis¬

The.

Ex¬

investment

of

nation

Yes, the NAIC made a
study in 1955. This study showed
some interesting figures. The gen¬

Fund

Vance, Sanders & Company

companies
Answer:

eral

Stock

Answer: Checks with three

figures showing the type of buyer

Life

Walter L. Morgan

compa¬

forts?

there

Are

Massachusetts

tributors, Inc., Boston

change houses in their retail ef¬

Fund Buyers

Philip-F. McLellan

theme.

Question:

the

nies •.by

Classification of

Breakdown

in the promotion

broadening of the "invest

America"

(2539)

with

Peck

&

re¬

Members Nete York Stock

Haberler is

elected Chairman.

Exchange

and American Stock Exchange

\

Herbert R. Anderson

Impact of MIP

(6)

Question:

duction

Distributors

the

Has

intro¬

the New York Stock
Exchange of its Monthly Investitnent Programs affected the sale
of investment company shares ad¬
versely?
by

The

Answer:

York

New

It has served to focus attention

its

extol

that

of investment and

with

merits

the

both

the

Stock

Group,
York

New

Curtis H.

Hugh

the

Bingham

nomic

Bullock

result

Co., Buffalo

Eaton

&

re¬

Council

of

DEALERS IN

Eco¬

Advisers, has been elected

RAILROAD SECURITIES

"While

the

ference,

a

basic

Howard, Incorporated

a

t

U

bo(h serve useful
therefore comple¬
other.
The industry

each

welcomes

the

MIP

Paul

H

and

program

A.

In¬

Just

Unlisted Investment Stocks

d

a rva r

120 Broadway

Board,

Management
Chicago

In

the

-r

,

Dr.

ment, Harry

Exchange and other

Y

Underwriters, Distributors and Dealers

returning to a type of work
which he had long been de¬
"He

BEVERLY

PITTSBURGH

who

Office

HILLS, CAL.

was

in

Bureau

GENEVA, SWITZERLAND

AMSTERDAM, HOLLAND

;

turning

sorship

AIRES, ARGENTINA *

the National Bu¬

H I R SC H

1953,

Dr. Burns was
of
Economics at

Professor

also

HOLLYWOOD, fla.

University.

He

is

well

as

CO.

&

York Stock Exchange

New

25 BROAD STREET,

re¬

his university profes¬

to

Members

and

Other Exchanges

NEW YORK 4, N. Y.

Teletype: N.Y. 1-210

Telephone: IIAnover 2-0600

to the National

as

Bureau.

MThe

call

Washington,

to

four

interrupted a large
project that Dr. Burns was then
engaged upon, in the general field
of, business cycles and economic
stability. Actually, of course, the
interruption was very much in the
public interest.
In his post as

Underwriters and Distributors

Corporate Securities

1636

ago,

years

of

director of research from

Columbia

BUENOS

Corporate and Municipal Securities

Before leaving the National

reau.

City Branches

CORAL GABLES

in

re¬

before going to Wash¬

the inception of

STREET, N. Y. C„ B0 9-8420

MIAMI BEACH

of

ington," said Mr. Scherman, "and
prior to that, for 18 years worked
closely with Dr. Wesley Mitchell,

*

Sherry Netherland Hotel (PL 1-2220) & 1430 Broadway (PE 6-5775)
DETROIT

director

was

search at the National Bureau for

.

leading stock and commodity exchanges

CHICAGO

Philadelphia

to

Book-of-the-

the

of

seven years

New York

Teletype NY 1-724

Private wire

Club, and outgoing Chair¬

voted.

H.HENTZ & CO.

Main

*

was

YEAR

to

60 BEAVER

'• Y

'

,

Arthur F. Burnt

Bureau, pointed out that Dr. Burns

York Stock

■

of the Board of the National

man

New

•

making

Month

Members

New York 5, N. Y.
"

'

-

announce¬

Chairman

lOOth

-

Telephone REctor 2-4949
'■

i.

'

'

•

Y

Chair-

Scherman,

OUR

Y

~ '

Y
'

of the

ma n

,

Shares

Corporation,

and

YV,

i versity,

n

elected

California

Television

Common'

>

Haber¬

has-been

Egan

Company
corporated, San Francisco

dif¬

they
and

purposes

ment

have

two

First

.Preferred

of Economics

Boston
John F.

Bonds

Re¬

v

Monthly Investment Programs and
Fund Programs have benefited.

LeasedXine

-i

of

Economic

Guaranteed

ler, Professor

Charles F. Eaton, Jr.
r

who

Chairman of

National

fried

Exchange

as

search. Gott¬

Roy W. Doolittle
&

Burns,

1

President of

Bureau

Bullock, Ltd., New York

Doolittle

F.

Dec.

on

President's

the

on

to

Arthur

signed

Angeles

Calvin

Dr.

Incorpo¬

Bingham, Walter & Hurry, Inc.
Los

Stock

Exchange program has been a big
help in the sale of mutual funds.
this method

rated,

of the

Chairman

ICeyser Building

1610 Washington Ave.,

Baltimore 2

Eye St., N. W.

Miami Beach . 39

j

Tel: JJEIferson 1-j6761

I

Washington 6
Tel:

NAtional 8-2545

LONDON,

ENGLAND

Direct Wire Service

-

*

_

Tel:, LExington 9-7861

Representatives' Offices: GENEVA

—

—

•

AMSTERDAM

New York, Washington, Baltimore and Miami Beach

Council of Eco-

noinic

Over

a

Half

Advisers, Dr. Burns was
able to apply the extraordinarily
wide knowledge he had acquired
at the National Bureau to impor¬

Century of Efficient and Economical Service

of

problems

tant

UNDERWRITERS and DISTRIBUTORS

national' eco¬

nomic policy. But we are happy
to have him return to his basic

as transfer agent

Industrial, Public Utility and

scientific research.
"We have elected

in

him

as

Railroad

Presi¬

We

york, n. y. AND jersey city, n. j,

afford

economies

and

other

advantages

underwriters, distributors, corporations
and

to
Y

their stockholders.

embark on important new studies

and

State

our

free booklet setting forth the Current Federal

Stock

Original Issue and Transfer Tax Rates.

i

economic

Bank and Insurance Stocks

present Director of Research, Dr.
Solomon Fabricant, on general re¬
search

policy

widespread
Write for

.'

policy for stabiliza¬
tion and growth. At the same time
he
will work
closely with our
of

which

our

guiding

the

Unlisted Securities

other

areas of research on
staff is constantly en¬

Laird, Bissell & Meeds

gaged."

MEMBERS

registrar AND transfer company
SO CHURCH STREET

.

IS EXCHANGE PLACE

Two With F. I. du Pont

BEekman 3-2170




isdd
~

Jersey City 2, N. J.
HEnderson 4-8525

NEW YORK

120

AND

AMERICAN

;

STOCK EXCHANGES

BROADWAY, NEW YORK 5, N. Y.

(Special to The Financial Chronicle)

LOS

Reid

New York 7, N. Y.

V!,

Municipal Bonds

studies of economic change and to

new

Securities;

him, to pursue his

dent to enable

ANGELES, Calif.—John D.

and

du Pont &

Street.
with

Ben

A. Rubin have be¬

affiliated

come

Telephone BArclay 7-3500

with

Francis

I.

Co., 677 South Figueroa

Mr.

Reid

was

Dempsey-Tegeler

formerly
&

Co.

PONT

DU

BUILPING

WILMINGTON,
44

WHITNEY

NEW

HAVEN,

Bell Teletype NY 1-1248-49
PHILADELPHIA NATIONAL BANK BLDG.

PHILADELPHIA, PA.

DEL.

AVE.

CONN

ZURICH
SWITZERLAND

160

W.

BROADWAY

SALEM, N. J.

.

44

The Commercial and Financial Chronicle

(2540)

.

.

Thursday, December 13, 1956

.

Report of IB A Nuclear Industry Committee
Under

the

William S.
&

Chairmanship

of

piled
the

Associa¬

Bankers

of

America,
wood, Fla.

held

is

the

Committee's

third

growing industry but

a

Industry
In

report.

the position of

power,

that

projected capital require¬

as:

metals.

the

10 years;

positive accomplishments to date and investment

atomic

en-

have

ergy

from

emerged
haze of

a

con¬

jecture
into
an atmosphere
wherein

it

t

o

rare

logical

and

feasible

pat¬

which

tivities

in

the

nuclear

a

the

At

time

uranium

of

promise

a

by United States firms,

our

first

report

pre-empted
Last

year

in
the
at

success

Conference seemed

rapid development of

nuclear power on an

embraces

which

will

power.

ing

an

1957

tween
a

total

been

less

dramatic

"Nucleonics"
Third

in

Annual

Atomic

in

The

trends:

A

mood

the
the

on

in

Forum
on

more

of

Meeting

Industrial

a

magazine

reporting

tember commented
cant

of

but

nature,

Sep¬

two signifi¬
of

realism

facing problems in contrast to

the unbounded and sometimes

founded
earlier

un¬

evidenced

enthusiasm

at

meetings, and the progress

and

of

commercial

and

1962

generating

provide

capability

of

Significantly, six of
a total

of

be built

any

18

plants representing

investment

will

reactors,

into operation be¬

go

1,200,000 kw.
18

30

provide

million, will

dependence

past year have

are

These 18 plants, represent¬
investment of over $650

nuclear

energy.

one-third

producing types. The
strictly civilian, power program

the

The events of the

than

more

international
scale, and introduced the exciting
possibility of controlled thermo¬

substantial

or

power

now

exceptional

of the Geneva
to

growth

assured

interest.

the

time

partici¬

may

speculation

stocks

investor's

this

S. Hughes

economy.

unhealthy

an

of

to

as

; over¬

important

more

the

AEC

and

ac¬

irtipair,

seriously, the effectiveness of that

with 37

ments

civilian

nations to promote

of

use

atomic

energy;

in

about

the

the

United

vancement

atomic

of

pace

in its primary mis¬
maintaining the leadership

sion of

power

and

development in the United States.

States

in

the

nuclear

.of

ad¬

research

development.

This

uneasiness

the

over

prog¬
feeling has been and still is
ress
of U. S. nuclear power de¬
in
the
process
of negotiation— the government Is supplying en¬ that more atomic power is needed
velopment manifested itself when
riched uranium and is prepared to if
"for the first time, most of the
this
country is to retain its
the Joint Committee discussed the
talk was on what was being done
grant up to $350,000 for each such present leadership in the world.
new Gore Bill last June. This
bill,
reactor.
These nations, however, This apprehension is also shared
—not what was planned, desired,
entitled "Atomic Power Accelera¬
are
or hoped
becoming increasingly inter¬ by a segment of private industry.
for."
tion Amendment of 1956," was a
ested
in
It is of some interest to detail
power
reactor
agree¬
On the other side of the ledger, as
revision
of
the
As of June of this year,
previous
Gore
a
few
of these
was
evident during the hearings
positive accom¬ ments.
negotiations on power reactor which were: held in May on the Bill on which hearings were held
plishments.
in May.
The United States has built a agreements had been completed first draft of the highly publicized
with seven nations and were pro¬ Gore
<
total of 82 atomic reactors of all
The original Gore Bill, because
Bill, there were witnesses
who stated that the United States of the preference
types and sizes and 127 more are ceeding with four more nations.
clause in the
Industry, through its applica¬ could maintain its leadership Un¬ Atomic Energy Act of 1954, would
already under construction or in
the planning stage. Of the total of tions of radiation is realizing esti¬ der the
existing program and that have made it possible for public

209,

business

pate fully
of

William

within
our

the;

connection with

these agreements

The

.

the

outlines of

terns

will
sup¬

.

is

possible
discern

the

organization

made

developmentof

charges
by

vitriolic

so

shadow

of

mmercial

c o

its

of

attack

porters of both public and private
Such controversy can be¬

and impairment of AEC's primary mission.

controversy,

power

being made abroad, with constant
reference
to
reactor
sales
just

the

govern

basis

under

come

concepts
will

the

power.

companies active in nuclear industry; modify¬

new

Objects to Gore Bill for its potential involvement of AEC into public

since the Com¬

mittee's formation, the investment

which

establishing whole¬
prices for. nuclear generated
it would seem inevitable

sale

"economic

new

a

ing Public Utility Holding Co. Act; and developing profit prospects for

Nuclear

brief period

very

for next

banking backing of three

Report follows:

Foreword
This

becoming not only

energy

to the value or expense of
by¬
products. If the AEC is placed in

as

in view of

economy,

come

ments

The text of the

industry to the forest of the nuclear

prime mover." Report discusses such topics

Holly¬

at

of nuclear

nuclear

Convention of

Annual

Investment

tion

trees

their report

presented

and

to the 45th

sarily, be determined by judgment

Nuclear Committee suggests refocusing investment banking vision from the

Hughes of Wagenseller

Inc., Los Angeles, the
Nuclear Industry Committee com¬
Durst,

/

-

direct

$200

some

million

by industry without
for

government

on

subsidy.

The

first

of

the civilian power plants, at Ship-

pingport, Pa., will

into opera¬
tion
in
1957.
Serving the Pitts¬
burgh area with from 60,000 to
go

mated

agriculture

scale

for civilian

nuclear
use

exclusively in the

United States.
In

the

United

States

field

the

medicine

to

incalcula¬

in

applica¬

regards
quate.

the
A

of

this

in

the

Gore

program

attitude

inade¬

as

demonstration

found

expression

philosophy underlying the
introduced

in

the

last

of Congress and defeated
by the narrowest of margins.

The Gore Bill and Its Implications
the

This
of

Public

bill

much
few

has

mittee
been

been

the

controversy.

months

the

Utility- Industry

has

Joint
on

past,

For

the

Atomic

quite

members

Congressional
Energy

somewhat

j

subject

Com¬

in

to

power

expand the

spite

of

the

new

in

England

largely
would
have
this by providing that
plants be constructed at sites
major

in

connection
such

The

have

(energy and plutonium)
plant at Calder Hall. The British
is

Soviet

million

two

ambitious

kw.

Union

by

has:

Gore

new

more

have

authorized

is

capacity coming
late 1958. This

in

than twice what

more

ent program

While

we

kilowatt

type

our

the

pres¬

not

are

race

with

engaged in

the

rest

bill

of electric

energy

commercial

or

called

and

be

dismissed

lightly.

that Russia also has

seem

tor

also

is

well

reactor

of

diversified

Nthe

for

power

costs
plant will,

reactor

involve,

in

of

which

and

criticism,
sistance

design,
tion

of

granted

neces¬

for

power

no

reactor

as¬

and

in

We Offer

COMPREHENSIVE

reactors.

the

bill

would

a

INVESTMENT

AND

*

in

.

ALL CLASSES OF BONDS AND STOCKS

IN OVER 350 STOCKS

including

PUBLIC UTILITY—RAILROAD—INDUSTRIAL
FOREIGN
I

Direct

Wires

to

We Are

'

ISSUES

Particularly Adapted

to Service Firms
With Retail Distribution

Your

Inquiries Solicited

Reynolds & Co.. Philadelphia
Fewel

&




Co., Los Angeles

Burton J.

Vincent

&

Co., Chicago

P.

F.
120

FOX

&

CO., INC.

BROADWAY, NEW YORK 5, N. Y.

Telephone

REctor

2-77G0

Teletypes

NY

have

authority to Congress to

DEALER SERVICE

FIRM TRADING MARKETS

the

opera¬

Established 1928

1-4844

Bill

commen¬

aroused

other countries

construction

Finally,

Gore

special

which

called

to

the

of

deserved

dation,

a

50,000 kilowatts of

feature

inc.

New York 5

in

technology, and indicated that
plant was not to exceed

capacity
electricity.
One

of

would

approach, significant
promising advances in reac¬

a

prototypes.

operating

which

each such

that calls for not only
nuclear
capacity
but one

program

nuclear

&

large-scale proto¬

concept and

cannot

come

1-1825

of

industrial

The

attention, is the potential
involvement of the Atomic Energy
Commission in the public power
controversy.
For
sometime
to

NY

the

reactor demonstration

power

designs

too little

HAnover 2-0270

the

with

proceed

quantities.

a

of the

objection to the Gore
Bill which, perhaps, has received

Exchange Place

it would

directed

and

to

generation

in

calls for.

One basic

Mackie,

would

original
that
six

facilities to demonstrate the prac¬
tical value of such facilities for

operation

terms

40

also
the

with considerable

into

which

&

Bill

construction

more

Singer, Bean

operation

facilities.

claim that they will have between
2
and
2.5 million kw.
by 1960,

It would

.

the

Commission

a

.

of

The Russians

program.

this

.

the

eliminated

world, and while quality may be
more
important
than
quantity,

At Tour Service

with

production

arbitrary
requirement
plants be built. Instead,

1965.

a

facilities

behalf

on

would be used by the Commission
in

purpose

goal

or

of

power

October of this year with the dual

The

production

by

Commission. It also provided that
the
electric energy produced

in

inaugurated

was

be
The

bill

operated

- cjf
prototype and commercial atomic

Commercial

would

reactors.

of

technology in this country,
Kingdom and Russia

plants.

preferen¬

that

such

eliminated

United

power

buy

to

.

power

in

the

no

making
faster
strides
achieving
actual
operation

the

produced

by the fact that,
lead in atomic

our

groups

tially

are

have

apprehensive

need

no

program.

doubt influenced

the

session

to

was

I Those
who recommended
accelerated
program
were

better

and

"

forceful

Bill

there

present

power

7

Despite this evidence of tan¬
gible accomplishment a body of
opinion has been built up that

of

agree¬

an¬

gives

course,

inherent

nutrition.

the

Government

negotiated research reactor

to

benefits

tion

a

international

of

ble

plant

power

and,

consideration

no

100,000 kw., this will be the first

large

savings of $250 million

nually; this is exclusive of addi¬
tional large savings accruing to

1-944 &

NY

1-945

Volume

Number 5594

184

.

.

.

The Commercial and Financial Chronicle

form of government help to
private industry.
some

appropriate $400 million for the
AEC for expenditures as needed
in forthcoming fears:
The vote

Joint

Committee

favor.
of

Four

the

*

the

on

18-man

-

from

Reactor

Bill

House

committee

voting.
having

re¬

in

the

the

passed

Senate.
1

Public

trial

Forum

1956,

some

building
by

the

power.

Edison

the

before

meeting

on

measure

could

tryside

Company,

Atomic

the

released

be

immediate

the'

beyond

Sept. 26,

contamination of off-site

perhaps

or

desire

motivated

further

to

public

Mr. Gale added that

the

on

property

of

years

reactor

the

operation

safety record. During that

interest

safely

accelerate

AEC

25

atomic

our

that if Congress

was

nuclear

be¬

lieves that the public interest re¬

ficiently serious to
to personnel.

matter

declare

so

of

policy, specifying
expansion and
that the necessary funds be ap¬
Mr.
Gale
suggested
propriated.
as

a

the

extent

that

of

been

by

property

should

Senator

the

Clinton

Chairman
sional

radiation injury suf¬

or

the

of

Committee

cause

lost time

as

Company

Detroit.

of

One

Development

It

still

erating facilities

the

Financial Developments
With

few

very

business

in

the

banking

directing capital into
fields (other than

secondary nature. They have con¬

largely

formation

bution

of participation in
and public distri¬

investment

of

P.

Anderson,
Joint Congres¬
Atomic

on

En¬

a

government

companies
organized for the specific purpose

investing in established com¬
panies active in some field asso¬
ciated
with the development of
nuclear energy. One constructive
result

of

should

activities

these

be

in

tance

of

the

increasing
future

has

which

impor¬
been

give

both the investment
and the investment public

education

mentary

in

to

dealer

ele¬

an

industrial

atomics.
To

our knowledge at least three
companies active in the nu¬
clear industry, have received

new

equity capital backing from
eral

sev¬

the

of

large, well known
investment
banking firms.
The
private placement approach is nec¬
essary due to the speculative na¬
ture of these companies, but at
some future date their hoped-for
operative action Will undoubtedly ing this year. Fortunately, too, the
.growth and success may receive
strengthen the position of private, utility companies have maintained
public financing.
utilities
when the subject
of a confidence that such a bill will
For some time to come indus¬
.

further

expansion of our nuclear be passed and they have not been
capacity is taken up by the next deterred in their plans to continue
to move ahead.
Congress.
Representative Melvin Price
Modification or Amendment of
recently indicated that he would
the

introduce

a bill, early in the next
having as title I: "The
Indemnity Proposal," and II: "The

Accelerated
tor

Governmental

Reac¬

Program." It is his view that

the

will

Committee

Joint

continue

to

favors

favor

At

ties

and

for

maximum

insure

is how

best to

Holding:

when

time

trial atomic energy

will continue
to depend to a major degree upon
Government guidance and spon¬

atomic

as

power

an

increasing variety of

applications become

com¬

mercially established the cumula¬

pooled their resources
given project and have cre¬
nonprofit organizations
to

tive experience will enable indus¬

many

a

has

the gen¬

and

the

and
formed
non-profit
corporations to construct and op¬

been

erate

Industrial

field

the

for

naval

and

reactors.

struction

intended
cost of

tne

to

cover

the

capability.

The Regulatory Com¬

missions and Income Tax Author¬

air¬

vestment

grants

agreed to permit these
be written off over a

to

five-year

period so that a part
this cost is provided
by the
utility customer and through tax
savings. The balance of construction'costs, which may be consid¬
ered as the equivalent to the in¬
of

nuclear

that

would

have

needed

industry and the

is then financed in the usual

promising

very

outlook for nuclear powered ship?

merchant

tankers.

vessels

,

duction

new financing on the part of
private
industry.
The
figures,
however, have
another
signifi¬

for the investment business

because their

magnitude assures a
development in the
near future of related

relatively
enterprises in the fields of chem¬
ical
processing, feed materials,
radioisotopes,' instruments
aiid
control appliances and other serv¬
are

and

certain

to

of

debt and

equity

capital from the public.
To

date

the

great

man¬

of

are

contract

require substantial

both

been

plant,

awarded

two

to

rela¬

tively small companies.
The opportunities for financing
on the basis of longer term con¬
tracts may be greater than is su¬
perficially apparent. The AEC, as

auxiliary business which

amounts

conventional

zirconium and beryl¬
being expanded exten¬
sively on the basis of five-year
contracts signed with the Atomic
Energy Commission. Here, we are
dealing with contracts covering
volume and price for a sufficient
period to make possible shortterm private financing, and, in¬
deed, in some cases equity financ¬
ing as was recently done to fi¬
nance a beryllium and zirconium

lium

by

ice

a

through the sale of bonds and
equity securities
industrial facilities for the pro¬

portion of the required
capital will certainly be obtained

large-scale

for

ner

and

Some

cance

tor and
The

preponder¬

capital going into nuclear 4,a basic policy, encourages such
research and development by cor¬
arrangements.
For
example,
ance

of

porations has been provided from
sources.

established

Charles

Most companies
subsidiaries or

Chief,

Com¬

Branch, Di¬

of

Application,

United

operating expense or
through advances from treasury
funds.
Any needed new capital
as

Manly,

vision

specialized divisions and financed
their activities by absorbing the
costs

G.

mercial Development

States

Civilian

Atomic

Energy

an

Commission,

remarked

Continued

on

to

the

page

80

generate electric power.

the

rapid progress of the pro¬

Bill

Potter-Pastors

submitted

to

Public

Congress

to

was

amend

Utility Holding

Com¬

\

•

gram.
It

Act

pany

now

appears

may

be reached

sion

of

ated

reactor

Congress and
program

an

such

acceler¬

may

of

automatically

compromise

a

in the next ses¬

of

excess

installations by the public utility

including

con¬

covered

nuclear plant over a con¬
ventional
plant
of
comparable

indicated

of

of

are

a

ities have

acceleration

Part

funds

through grants from the control¬
ling companies; these grants are

range

have

ever,

of

sources

This forecast indi¬
of cumulative new
capital investment of $3 billion
minimum
to
$7.5 billion maxi¬
mum
over
the ten year period.
It seems very likely that the max¬
imum figure will prove to be the
closer to reality in view of the
a

internal

How¬

and

credit

companies is
being used in obtaining financing.

power.

cated

research and development.

utili¬

competitive,

craft

sorship and Government-financed

nuclear

eral

build and operate a nuclear reac¬

provided for in

concern

Utility

have

ated

the 1954 Act and that the Commit¬

tee's chief

a

is not yet

private participation in the atomic
power program as

Public

Company Act of 1935

session,

reactor

units

power

uranium ventures) have been of a

sisted

clear facilities will be part of the

exclusive of nuclear fuels,
for electric power stations, small

nuclear energy

the

nuclear

systems

generating systems,

projection confined to

a

company.

are
constructing
plants entirely at their
own expense without direct Gov¬
ernment aid or subsidy.
The nu¬

ment,

exceptions

efforts of the investment

by

of the

utility field two

public

reactor

period 1955-1965; this applied to
the capital cost of reactor plants
and related research and develop¬

well.

as

attempt
the Atomic

Forum in

program

Several
utility and industrial
companies have pooled their re¬

such

made

ap¬

that the Holding
Company Act of 1935 will have to
however,

pears,

part of the general ex¬

as

the

large

Projected Capital Requirements

of

compromise the number ergy, submitted a bill that would
dollars spent for permit the Federal Government
public power and private power to indemnify reactor builders and
be in proportion to the present operators to the extent of $500
amount of public power as com¬ million - above
the
amount
of
pared with the present amount third-party liability available
of private power.
from<; private
sources.
The 84th
A favorable development took Congress
adjourned on July 27
without passing the bill.
It re¬
place on October 5 of this year
with, the formation of the Caro¬ mains the fervent hope of private
lina-Virginia Nuclear Power As¬ and public industry that this bill
sociates, Inc., a non-profit cor¬ will be passed early in the next
poration for the development of session of Congress. Fortunately,
atomic power in the area served this delay will not be of major
by four utilities operating in the consequence since no private re¬
Carolines and Virginia. Such co¬ actor is scheduled te start operat¬
of

Reactor

In

financial forecasts.

probably as far as
need requires. It ap¬
cover the
case
of the

goes

to

pears
Power

period

have

operated

then

be made of the capital re¬
quirements to support the growth
of non-government atomics, and
they should be regarded only as
orders of magnitude rather than
can

present

remarkable

a

reactors

quires the program be accelerated,
Congress

12

pansion

this

dependence and to es¬
tablish long-term expansion pro¬
grams with some degree of accu¬
racy.
During the initial period
only the most tentative estimates

producing heat or steam only.
This exemption is not automatic
and requires the filing of an ap¬
plication. The SEC feels that this
the

nanced

from

^

45

incident to such operations is fi¬

an

increasing rapidity, to free itself

category of "electric utility
company" any non-profit research
and development company own¬
ing Or operating a nuclear reactor

the

in AEC facilities
private contractors)
for a total of 607,000 hours
(or
almost 70 years per a single re¬
actor), with no accidents involving
contamination
of
off-site

to take all the risks. His wise sug¬

gestion

compiled

(actually

beyond the ability
willingness of private industry

power program
or

has

try, at first gradually but with

not

was

be modified so as to exclude gen¬

personal injury.
It is significant that in

other hand, certain of them were
motivated
by the sincere belief
that it would be in the national
to

a

coun¬

vicinity of a nuclear plant. The
only accident
of this sort,
at
Chalk River, Canada, entailed no

Indus¬

government-owned

f

were

by

reactor over the

run-away

of the advocates of the
o

reactors

•

Gale, Chairman of the

Commonwealth
stated

•

Motivation

Power

As Willis

■

Although experience gained in
operation up to the pres¬
ent
time strongly suggests that
reactors can be made completely
safe and will not endanger the
communities they serve, there is
the possibility, however remote,
that
gaseous
and other
fission

reactor

Power

defeated

was

after

The

also

.

products

-

Republican members

frained

bill

July,
however,
the
SEC
modified its rule' to exclude from

Third-Party Liability Insurance

in

14-to-0

was

Act. This

ergy

passed by Congress.
In

bill in the

new

(2541)

be de¬

veloped that will probably include

by

exempting

the

from

Act

any

non-profit organization

which

AEC

a

Private

electric

generates

solely from
the

1935

under

the

Wires to:

power

facility licensed by
Atomic

We Make Markets

En¬

Glore, Forgan & Co.

Chicago
Cleveland

Gotiron, Russell & Co.

_

Dallas______ Dallas Union Securities

in
t

■.

Detroit

....

_

^

Company

Baker, Simonds & Co.

■

-

.

Coburn and Middlebrook Inc.

Hartford

Shelby Cullom Davis

&

Co.

Angeles

Harbison & Henderson

Philadelphia

H. A. Riecke & Co. Inc.

Los

Over the Counter

j

Members New York Stock Exchange

Pittsburgh

|

Securities

1

Arthurs, Lestrange & Co.
Fusz-Schmelzle & Co.

St. Louis

J

'

5

Underwriters

and

INSURANCE

CORPORATE
Oldest
Stocks.

AND

1

Dealers in

,

i

•

STOCKS

MUNICIPAL

BONDS

Singer & Co.

Specialists (with Predecessor Firm) in Insurance
Serving Dealers

and Institutions since

\

1927.

Members: New York Security Dealers Association

■

;

TRINITY

74

TLACE

NEW

YORK

C, N. Y.

I

110 WILLIAM

STREET, NEW YORK 38, N. Y.

Telephone BEekman 3-0626

•

Teletype NY 1-384

Telephone HAnover 2-2400
*

['IN THE HEART OF THE INSURANCE DISTRICT




,

Teletype NY 1-376;

377; 37S

1

1
'

■

■

'■

*

'

!
.

.

46

The Commercial and Financial

(2542)

Chronicle ;Thursday, December 13,1956

of IBA
under

The Canadian Committee,

the

Baldwin

of their

Canadian

K.

David

of

chairmanship

Nesbitt, Thomson and

of

the

Hollywood,

at

6f '*America, "held

ment
-

The text of the Report follows:

large

meet

to

reviews Canadian money

Florida,,

indicating

Report

welcomes capital in-flow for they

distributed

erly

Chairman submits

Committee

domestic savings

Ltd.,
Montreal, sub¬
Group's Report to the
45th
Annual
Convention of the
Investment
Bankers
Association
Company,

mitted

/■

need for

are

high

Canadian

not sufficient

it

used

is

coming

Probes role of

Canada, with only .16,people, is a very small
country indeed.
Her population
comprises less

y

of

c'eeded

of

ida

ranks

aixth

among

industrial

nations

and

fourth

was

among

ent

the

of

David

Can¬

world.

rate

be

been

high in the postwar
Last year at our FortyAnnual

Canadian
cliff e,

the

Convention,

Chairman,

highlighted

main

his

in

Canadian

discussed

the

the
Rat-

report

characteristics

-rowth of the
ind

Harry

of

the

ecdnomy,

factors

that

year

this

a

Such

vigorous

Canadian

the

growth as
has been

economy

ex-

periencing must inevitably be accompanied
by
major
problems
related

growth.
port

financing

of

such

It is proposed in this
deal

to

which

the

to

with

Canada's

the

economic

growth

possible,

has

been

financed

from

in

growth

w

this

re-

way

.

made

-

domestic

.

*

.

.

portion

of

in

probably

in

the

your

in

several

the

in

steps

Canada

have

towards

years

effective

briefly

that

during the

of

the

expressed

This

the

savings
One of

use

most

important of such

has

been

the

Canadian

—

Canada-

Market

the

that

regarding the volume
of United States in®

Money

generated within Canada.

to

years

has been

--o-

extent

vestments

few

taken

more

Welcomed
come

last

concern

Canada
—

and

Is

steps
development of the

of short-term

ber

con¬

I would like to point out, is
by. jjo means felt by-all Canadians,

resulted in

use

cern,

market,

money

has

of

selected

the

which

efficient

more

funds.

A

num¬

Investment

Deal¬

numbering 12, has played
key part in the development of
this
market mainly through the

ers, now
a

but rather by a" relatively few^who
have received,perhaps more pub-

abroad, with the result that in reppnt
Hnmoctip
co,""
'omestic savings re¬
A

VparC

y*dr?

aomesuc

savings

Canada

in

have

finance

to

but

re-

been

75%

of

capital
requirements, .while
the remaining 25% has been fi¬
nanced

&

we

investment funds
acja

to work

Auction of

know that these
come into

with,

new

in

us

pro-

wealth.

The volume of treasury bills

from

savings

brought

should'

deavor to make

more

approximately

While

purchased

banking

en¬

efficient

of

four years ago,

supplement

should

1953

present • total

»uppiL.iiicm

Canadians

of

$1,665,000,000.

themV For th.s reason, it is recogmzed
that

use

$650,to

less

treasury bills

almost

solely

Continued

on

than

the

by

today

system,

a

>/.

very

page

in

<

//.

t

up |

/

,

i'

V' "/■

'

I i'h.

mm*'':
''

McMANUS

&

WALKER

39 BROADWAY

One of Canada's problems inso¬

far

her domestic savings is con-*
has to do with the pattern

as

of these

savings in relation to the

pattern of the demand for capital
funds. By the "pattern of savings"

NEW YORK 6, N. Y.

UNDERWRITERS

cerned

/'J,''

■mm

kt *

)

in

in

DISTRIBUTORS
and

Corporate and

Municipal Securities

DEALERS

this

instance is meant the pro¬
portionate amount of total savings

i

that exists in the form of personal
member'S '
NEW

-

YORK

STOCK

AMERJ C AN. STOCK

MIDWEST STOCK

1

/

savings,

corporation

the

EXCHANGE

savings,

and

savings,- and further,

government

EXCHANGE
EXCHANGE

Service to

Unlisted

proportionate amount of such

personal

savings

that

is

held

by

other financial

is

that

from

which

an

through

institutions.

The pattern of Canadian

at

social

stitutions
these

are

that

pattern

savings.

for

It

in¬

influence

distribution of wealth and
the

is

both

/

-

•

its

as

concerned, for it is

factors

j*.

expect

financial

and

f

fairly hi°h

a

stage of develooment insofar

political,

Syndicate Department...

our:

savings

might

one

economy

Trading Department...

Dealers

insurance and trust companies and

; hi

BOSTON

CHICAGO

the

set the

incomes

probable

NEW YORK

LEE HIGGINSON

and

that

MEMBERS

CORPORATION

New York, Boston and

Investment

Midwest Stock Exchanges

American Stock Exchange

Banking Service Since 1848

(Associate)

the

pattern of savings in Canada is not
NtW YORK

\

too
in

unlike

the

pattern

the United

Venture

Capital

of savings

States.

^ PITT5BURCH ^"ARRISflURG
—~y UIIKnMMW

/
^

.SPABlANBlC |T

(

Needed

UNDERWRITERS

In

a

a
o

different

the

pattern

productive

Canada?s

of

MUNICIPAL

activity is weighted to a
fairly large extent by the devel¬
opment
the

Such

•M", '

,

i

1

^ '

'

'

-

"

''

available

Thus,

the

THE

PRIVATE

NATIONAL

•

COVERAGE

OF

WIRE
LISTED

AND

SYSTEM
UNLISTED

MARKETS

ume

'

i,,
*

"
i

in

the

•

re¬

PRIVATE PLACEMENTS

of

pattern

situation

of

exists

CORPORATE FINANCING

that

^

able

for
far

the

,

savings

venture

from

demand

for

to

venture

has
meet

capital

funds.

Canadians, therefore, have

found

it

necessary

to

Tan alstyne, woel - & Co.

avail¬

purposes

sufficient

?




vol¬

the

meet

capital funds required, the

proportion of such
been

»-

industries.

savings.

almost-sufficient to

" " y 'r/'

FOR

1L

and

resources

new

although Canada's domestic sav¬
ings in total amount have been
'

,

of

AND CORPORATE

SECURITIES

large amount of venture
capital, more, in fact, than

Canadian

/

,

/

a

risk

is

.

natural

developmental activities

quire
or

of

launching

DISTRIBUTORS

for

emerges,

side

economic

•%

AND

examining the demand for
capital funds in Canada, however,

import

Members:
New

York

52

Stock

WALL

the

same

ported

some

time

they

have

portion of their

savings to other countries

in

American

Stock

Exchange

STREET, NEW YORK 5

a

great deal of venture capital, while
at

Exchange

ex¬
own

the

Pliiladeljthia Office
Room 831, Western

Saving Fund Ruilding, Broad & Chestnut Sts.

the

were

from other countries.

'''

in

from

000,000 at the end

^

,..

day-to-day loans which have
provided the investment dealers

Canada has increased

available from within Canada,
ather

of

able rates.

ou^s?^e 0^ our ^<)lln^r^' we sfl^
J19wevfr' ft?* s"ch,
are
b t

money market has been the estab¬
lishment by the chartered banks

in the money market with a ready
source
of call money at reason¬

Can-

the

re-

However, some part
savings are invested

Canadian

Of

her

Z'

of

been

'J
been sufficient to Even though we do welCome
Canadian coital
the inflow-of-capital ■ funds from

ouirements.

maining

\

has

some
---

Capital

the future, for

"1

Canada s domestic- savings have
nevertheless been at a very highlevel in recent years, and in total

sufficient

-

gov-

smaller* amounts^- have have United .States. investment;
originated in Great Britain, Switz- f,jnc|S jn Canada in the past, an.,
erland and other European coun- wm continue to welcome them in

^ri®s*

year.

-

have

S.

her

therefore, to import savings from
establishment
of
an
active
sec¬
9
** countries, and, as yoif are - iicity; than was warranted. I anv
aware, the largest proportion of confident that I speak' for the. ma- ondary market for Government of
Canada treasury bills.
Also im¬
all pres- these imported savings has "origi- jority of Canadians when, I.
say
portant in the development of the
1957 will -nated-in. the United States,- while-, that we have been very glad to

of continued

one

re-

markably
years.
'oUrth

."V

-

.

expansion in I
capital program as
large and perhaps larger than that

Baldwin

of

has

From

indications, the

Canada with

growth

economic

K.

U.

outside

from

like to mention

number

a

investments,

would

last

notice

Musi Supplement High Domestic_

direct

ernment loans, etc.

-nit

,

of

is possible,
in wel¬

as

justified

almost 12 % above that for the

first half of 1955.

trading

nations

.

tional Product at annual rates for
the first six months of this year

the

ol

world

nancing.

This has

Canada s economic expansion is
record capital program,"
All sec- resulting in a greater demand for
dors, provinces and almost all in- coital funds to finance such, exdustries have been participating pansion than can be financed from
m this expansion.
The Gross Na- domestic savings. It is neeessaiT>

this,
however, Can-

ada's

expectations.

ex-

penditures involving a program
projected at 28% above last year's

billions.

vhe

all

has.

advance

Z

Despite

the

economic

form

some of the problems that-have
arisen in the course of -this fi-

During the last 12 months, Canada's

1%

population

savings and from imports of caoital funds, and to discuss briefly

•

world's

the

of

Expectations

two-

than

thirds

Exceeds

Year's Growth

funds

Developing
I

000,000

fully

borders.

In terms of the size of her pop¬

ulation,

though

even

conscious effort to

effectively

as

Canada

U. S. capital in meeting Canadian trade deficit with U. S. A.

w

a

when

market development, and assist received from invest¬

dealers and Government tax dividend credit provision.

savings

own

mean

modify somewhat the present pat¬
tern
of
such
savings, for only
Canadian savings are being

nor prop¬

capital funds. Committee

venture

may

.?'1-

.*,«•

/.<r?

69

i'i Tf

,-n
■

f

Volume

Number

184

Chairman

Gilbert

The Commercial and Financial Chronicle

5594

H.

Osgood,

'

mittee
the

State

45th

the

urges

legislative committee

group

Legislation Com¬

appenaic.s

and

report

Conven ion

Annual

Investment

consideration

to

t-

contracts
are 'subjected
to
thf\
same
regulatory requirement "an
other securities under Federal and

oi

Assoc

Bankers

to give

adoption in their respective states off proposed model arid tmffofrm laws, aftd

at

to

a-

report back to IBA CounciHnStaJnces of artiendments to

or

slate

adoptions 6f

of

America,
wood, Fla.
The

and

text

held

There have

opment's
which

•

tance

in

will

the

mittee
years.

/•' '

the

the

of

•

and

past

of

the

-v:

- year

the

next

Con-

tion becomes effective if specified? ate action to assure that (1) "vari-;
are met.
^ able annuities'' are subjected to.

Securities Act;

uniform

the

.

proposed

securities

state

•

act

pared,

pre-;

under

Harvard

the
Law

i t i

e s

Regulation

adopted.

was

with

few

a

changes

August by tae
National- C^n-

ference

of

Commission-*
ers

Uni¬

on

form

State

Laws and
Gilbert

Bar

11.

Association.

form

act

was

The

r.ew

.

jn

Association

Administrators

of

Securities.

its

at'

'annual

uniform

new

act

is

de¬

signed in three separate parts embodying three separate types of

regulation, plus a tourt.i part containing general provisions: ; '
.

Part

I:

Covers

certain
Part
of

II:

Covers

Of

III-

and

practices.

the

broker-deaiers,

investment
Part

fraudulent

prohibited

•

reg sixation

agents

and

Covers

the

resistrVHn

registra ion

'

^

Part

IV:

visions

v

uniform

Includes

general

defimt

covering

pro-

ons, ex-

securities

if led

prepared

be
oc

arait

Clarities

draft

is

act

by

the IBA
111UU1UC
modiiied

makes

and

more

specific certain pi\,........ of the
provisions
Without

act

impairing

the

form

procedures under-it

basic

requirements

in

uiii-

the

or

it.

and civil liabilities.

insurance

Amendments

A

complete
adopted

was

securities

new

in

Virginia,

effective Jan.

any

one

or

Part

IV

should

particularly be noted
that Part III covering the regis¬
tration
of
securities
provides
three separate types of registra¬
tion -for securities.-- Registration
by "notification" affords a simple
streamlined procedure for registering securities of seasoned companies which • meet- a
specified
earnings requirement.
Re.is.ra¬
tion
by "coordination" prov.des
a
special procedure for regis.ra¬
tion of securities which are regis¬

Immediately T

act-;

o

11

o w

ber of

objectionable provisions.

A

with

all

the

drafting committee, and

of the

principal objectionable

provisions were eliminated. Memkers of the committee of dealers
Joseph

Muldowney

(Scott

and Stringfellow,/ Richmond),
chairman; Edward C.'Anders n
(Anderson

&

Strudwick,

Rich-

mond); Walter W. Craigie (F. W.
Crakie & Co., Richmond) ^ John

Gallaner

E.

(Gallaher

Co.,

mittee
In

We

com¬

members

the

com¬

the

their

for

New

several

York

of

successful
a

bill

.

0n June

work.

embodying

important amendments to

the

New York Securities Law
passed the Legislature but was
vetoed by the Governor.
t

iii

the

have

nature

of

described

so-called

the

•

S.

U.

filed

Court

become

the

effective automatically at
that
Federal
registra-

time

istrators

general
an¬

the

Board

At

reports.

of

Governors

recommended that the Association
and its members take appropri-

UNDERWRITERS AND

of

the

state

acts)
this
year
resolution which
year

securities

reaffirmed

adopted last
regarding variable annuities,,

follows:

as

L

-"The

Executive
Committee Icy
the National Association of Secu-

rities, Administrators,

assembled

which

ance

annuity plans to the sale of securi¬

held
had

hearings on
bills,
:—
previously passed the

ties

issuance

annuity

and

Counsel

for

in

the

New

IBA

various

Blue

Sky

The

insur¬

effect

would

Jersey.

testified

must

vannnc

ine

sale of vari¬

contracts by

companies

which

th

Jersey Assembly, to author-

the

able

of

segment

at

laws

and

of

be

unde-

and

state

regulation:*.

legislation

deprive

the

a

investing

Continued

these" hearings and urged that the

made

such

to

of

be

Federal

on

orovVsionVof :the

Persuing

.

k

•

•-

I-'-'-

i

&

Co.

{

•

of

—

Act

of

1940

the sale

in

connection

of contracts

with

in

satisfying the requirements of member

described "as

"variable annuity contracts."

The

firms outside of New York

City, provides a

complaint

alleges that the com¬
pany's contract constitutes an in¬
vestment

a

and

contract

interest

a

profit-sharing agreement within
definition

the

rity"

the

of

contained

in

term

"sec-u-

the Securities

Act of 1933 and that the offer and
sale of such contracts is

unique combination of services, which in¬

certiii-

participation in

or

subject to

tj-,e registration provisions of that
Act.
Another
allegation of the

complaint is that the company,

clude research facilities, a modern communi¬
cations system,
ties

floor

administers, is primarily en¬
in the business of invest¬

curities
an

within

the

"investment

definition

of

pany,

by it,

1940

company"

and

that

se¬

of

con¬

for

the

com¬

or.;.the funds administered
is subject to the registra-

delivery, and safe¬
seven

experienced

partners for the execution of orders.

Through

a

direct private wire system to

eighteen correspondent firms, and their branch
offices in

Company
the

thoroughly mechanized facili¬

clearance,

keeping of securities, and

or
in the alternative the funds which

ing, reinvesting and trading in

offer

our

service,

eighty-seven cities,

correspondents

a

we are

able to

well rounded

tailored to their-individual needs.

Pershing & Co.
STATE, MUNICIPAL AND REVENUE BONDS

Members
New York Stock Exchange
■

Established

&

CO.

120

Broadway, New York 6




of

Trade

BROADWAY

NEW

115

American Stock Exchange

Chicago Board

1891

Direct Wires to Our 30 Branch Offices

One North LaSalle Street,

Chicago 2

CJ

•—J

in

Art*

Seeuritks

large
public-

page

DISTRIBUTORS

GOODBODY

-tfaa

it

Bridge-.
"variable en-

gaged

"variable

previous

Affairs

New

Association

from

?rovlslons of-the Securities Act oi.
Company

Act

would

j
few

1933 and the Investment

tained in the Investment

securities

[
will

a

,

The Executive
Committee ic?
the National Association of Securi-ties Administrators (the admir. •

i
A

the

for

to enjoin t.ie
Annuity Lite 'insurance
Co.; of America, Inc. ("VAL1C")
from, .-violating
the
registration

IBA

such

in

port

Variable

the last ^Annual Convention of the

for

the

n g

complaint

a

District

Act

1933, and this state regis¬

within

N.A.S.A.

19 the SEC ann0Unced

nad

nuities"

of

held

of

District of Columbia

it
"Variable Annuities"

We

it

^jlaj.

&

Richmond).

Inc.,

mend

unfairly-

memorandum
concluded
tha t,
"variable annuities" are "securities" subject to the Federal SeT
curities Act of 1933. 1

tered under the Federal Securities

tration

i

1957.
Tne- George Davis on May 23 sent -to
original draft of the new Virginia all members of the IBA copies of
Securities Act, included as part the - memorandum
prepared
by
of a complete new Virginia CorIBA Counsel regarding regulation
poration Code, contained a num- of ."variable
annuities."
That
committee of Virginia dealers met

surance

ize

1,

_

It

companies.

be-.- Spring Meeting, IBA Pres dent.

to

James

adopt

•

State Securities Acts

in

can

Act.

On -March 1, 1956, at .'the re- the
Hartford
County
Supreme
quest of Officials in the Treasury- Court for a temporary injunction
|
|
Department,
representatives
of restraining the American Life In

companies, and (4) why
companies issuing "variable annuities" should not
be taxed as

more of the three typ:s of
reg-"
ulation in Parts I, II and III, plus
the applicable general provision's

state

that

the. complaint

on

given

advantages. ". The

*n New York on May 11, 1955,
selling
after considering proposed legisthe taxation of "variable annuity"- dowment"
contracts
which
the Nation which would
permit thd
companies.' A memorandum was company proposed to sell. Under issuance and sale of variable ain--,
submitted
to
the
Treasury De- a stipulation this case has been uuities by insurance companies,1 Is
partment pointing out (1) what taken directly to the Connecticut °f the opinion that the absence oy
'-variable annuities" are, (2) tne Supreme Court of Errors and it tegal safeguards provided by FedPosition of the IBA with respect appears probable that the case eral and state statutes could prov.i
to ' variable annuities, . (3) tne will not be heard before De- to be very detrimental to tW
investing public. This conclusion
dax'sfif*Lei"• which.would be ere-• cember.
is
arrived
at
by reason of the
aL®d.
companies issuing ' vanOn June 22 the- New Jersey
basic
similarity of the variable
a.~ annuities were taxed as in- Senate Committee on Business

II

(Scott, v Horner &
Mason,
Inc.,
Lyqchburg); Roderick D. Moore
(Branch, Cabell & Co., R i c hmond); James H. Scott (Scott &
Stringfeilow, Richmond), and

a

of

;

r surance

^

;emptionsr
adminis'ration,
cn- c.
Hagan, Jr. (Mason-Hagan, Inc.,
forcement,
criminal
penalites- Richmond); Edwin B. Horner

Thus,

;

that the modthe'
tllc.

because

usec|
uscu

were

advisors.

sernrmes

tiie-

aut.iot^es

we urge

come

meeting.
The

tax

pro-

(2) such

,

as

state where adoption of

any
new

also

was

aci

considered,

uni¬

subsequently
approved in principle by the Na^
tional

The

approved
by
the American

Osgood

..

other securities under Federal months.
deny or revoke
registration pf; and state securities acts; and (2)
In * Connecticut, the Insurance
dealers, agents and securities and -irvqrj&Die annuities' and other sc- Commissioner and the Banking
to impose certain conditions upn
curities be given like treatment Commissioner (who administers
registration i of certain types of under the tax laws.
the state securities act) applied to

the

in.

hearing

the

ther action had been taken at th3
time this-report was prepared..

.

-

provisions

the same regulatory requirements-.probably, be

act

Administrator to
impose a lew
requirements which are not gen-'
erally required oi n d e r present the IBA met with officials of the'
stave securities acts,
treasury Department to discuss

Study of Sia/ce
r

the

Gf

would be giv^en'broad authority to-

securities.

School

£\ecu

^ministrator

,p^e

tion

for

New Jersey Legislature continues
in session this fall, butf no'.fur-

:

variable annuities by Committees of

several conditions
•

final draft of

and

the National Association of Securities Administrators.

*

acts

not

are

Position

7

The

investment clubs

on

state securities act;

impor¬

_

State

The Committee Statement discusses

acts.

final draft off the proposed unlfarm

as

dsvel-

-

/Uniform

views

•'

:

major

work

during

developments

appendices of
-

been several

be

securities

state

contracts

favorable

during

-

IBA-recommended
such

the Report follow:■

Holly¬

at

securities

tectlon of investors and

.

tion

47

bills not be passed unless (1) siich

Committee 'Report

(Blunt Ellis & Simmons, Chicago)
submitted

(2543)

YORK

5

48

The Commercial and Financial Chronicle

(2544)

.

.

Thursday, December 13,1956

.

Report of IBA Federal Taxation Committee
Walter

&

presented
Bankers

Co.,

held at

To

Committee headed by

City,
Investment

the

to

Shearson,
York

New

Association

their 45th

at

of

Maynard,

Hammill

was

rate

a

3% maximum of the sold asset's value; in¬

in nominal dividend credit; and

crease

Chairman.

mission

The text of the Report follows:
the

At

seemed

that there

ity that
come

beginning

tax

election.

was

in

1956 it
possibil¬

a

reduction

issue

an

of

damaging, and since a tremen¬
dous job
of education must be
done, it seems that the matter of

November

The

Democrats
talked

of

islation

of

the

continually

e g-

tions such

which

would

the

reform

ad¬

vocating 1

laws should

tax

be

associa¬

by

pressed

matter of

en

in

of

Areas

of
In

of

series

a

Reform

of

none

reduce

on

the

is

rates

the

held

the Mills Subcommittee
on
Tax Policy of the Joint Con¬
gressional Committee on the Eco¬
nomic Report, great emphasis was

cally

laid

equal

of

taxpayers.
The Republic

view

n

a

seemed

that

be

to

tax

of

re¬

Walter

by

income

reversion

to

the

tax

tax

taxpayers to create

of

rates

on

tax

contained in earlier tax bills while
taxes

rates

ing,

in

i.

having

e.,

ladder

of

the

clear
tion

the

time

present

whether
will

the
should

climbed

up

be

is

tax

not

or

it

of

the

is

scheduled
ters and

only

on

not

well develop

surplus,

will not be

a

that

seem

gain

if

our

behind

income

Con¬

The Income Tax

under

a

ond,

a

should

come

two

headings; first, a re¬
punitive rates, and sec¬
means of averaging income

for those with highly variable in¬

substan¬

comes.

live issue.

the

to

the

Yet, this

exceed

man's
for fig-

a

rewarded

of

means

50%.

his

reducing

tax liabilities than for earning an

amount

additional

of

in-

first

*

of 50%.

The

past

has again
our

in

year

provided

industry is

business

our

evidence

that

in which prof¬

one

its vary widely from year to year.
The
inherent
arithmetic
of
the

we

over

a

had

income

will

pay

period of

received

amount

nual

of

tax

the

such

total

same

in

income

equal

Such

we

an¬

state

a

of

remedy

would

for

be

this

for

the

would

tax

who

lowering the rate
this time would be,

objection
of the tax

which

in

could

reinvest

the

flation and

are

actions

form

in

pay

been

is

had been received in annual

if

the

in¬

same

Complete Underwriting and Distribution Facilities for funds for the difference.
equal instalments, to receive
difference.

form

limitation

a

of

the

in

re-

*f

the

value

as

of

a

•'

t

■

Our

has

Special Offerings

long

advo¬

on

the

ground

or

"locked-in"

large amounts of potentially
turesome
a

HORNBLOWER & WEEKS

as

ven¬

ital.

now

growing

economy

such

could be

measures

tak-

at

conditions

which

low

a

his

of

would

have

not,

it

and were

is

BOSTON

NEW

ROCKFORD

YORK

CHICAGO

PROVIDENCE

CHARLOTTE

DETROIT

PORTLAND

which
a

small

dividend

WORCESTER

MEMPHIS

as

that

it

they

diminish

been

so

that

''I remember

FOREIGN

one

catch

SECURITIES

weekly

,

on a

private placement of

holiday week-end. Wc wanted

„

news

AF-(iL made the
j

a

grade—actually'reduced a fourteen day
six days. Andmf course .the a<j was letter

magazine closing to
...

perfect. It's comforting to know that your agency can give
such fast service in

MODEL, ROLAND
Members

120
NEW

New

YORK .5.

20-24

•

*

.

Stock

N.

»




STONE

If

xou concern

\owll like
Send

emergency

yourself with advertising or public relations,
little jpia rterlx, ftAE-(JE Views with lute rest."
uante and -we'll mad d to van. Address
Ed dor"

our

us your

j

WORTH

4-5300

'

-

'

1

.

•
v

Y.

TELETYPE

NORTHGATE

MOOREGATE,

Private

&

Exchange

BROADWAY

LONDON:

•<

York

an

Teletype

to

NY

1-2525

ALBERT FRANK-GUENTHER

HOUSE,

LONDON,

E.

C.

London, England

2.

Advertising,
.

s

-

•

Public Relutions

•

LAW, INC.

131 Ccdur Street, New York 0, A. Y.

a

dis¬

with

credits

•

developing

" philadelphia
BOSTON

chicago

SAft FRANCISCO
LOS ANGELES

should
taxation

We should logi-

magazines as well as newspapers,
By working ldtig hours and providing alternate types
of
reproduction material via air mail and air express,
to

;

'advertisement

dcl>cnturcs scheduled .over

a

discriminatory

AF-GL."

it from

"loop¬
isn't—

satisfactory

capital

needing

need fast service,

and we get

|For Banks, Brokers and Dealers

of

increased

"As Securities Underwriters
we

a

it

The Canadians have

against equities.

price.

This tax

as

diminution

have

logical

all,

acquired

credit

maximum of 20%. It is, after

a

country

for

a

of dividends

course

PEORIA
DALLAS

doubt

credits, and their expe¬

has

rience

to

of

CLEVELAND

BANGOR

un¬

capital

provides for

Established 1888

PHILADELPHIA

the

considerable experience

had

cap¬

held

been

be

without

corporations.

crimination.

capital gains tax under

long period

a

97%

from

would

individuals of 4%

hole"

does, totally prevent sales of

assets

ours.

Several

The

these

capital, badly needed in

rapidly

retain

would

would

has been under attack

cost

he

capital gains
that a purely

tax

the

law,

which

nature immobilized

lower rate of

The basic maxi¬

25%

Treasury

of domestic

be

voluntary, self-assessed tax of this

a

'

tax

Private Placements

industry

could

present
asset

an

one.

of

ent tax code

capital gains tax lia¬

Under
of

rate

Divisions

proportion

owner

Tax

laws

would

It will be recalled that the pres¬

nothing, if he sells it, must give
up 25% of his capital in the form
of a capital gains tax. If the pro¬
posed limitations were set at 3%,

cated

'!:■

Gains

lax

principle

Double Taxation of Corporate

to

sale

of the-

3%

this

assets

property which

a

sold,

asset

materially increased.

possible relief
the

on

of

event

assessed

of

bility.
Capital

f

be

tax penalties involved.
Another

of

the

simple

gains

cannot take
place at all because of the heavy

come

Secondaries

the

simply

now

maximum

If

lim¬

were

amendment to the

a

mum

trans¬

appreciated

have

Registered Offerings

of

tax

relief

of

kinds

wishing

merchandise.

changed, administrative problems
would be negligible, and yield to

are

a
period of years, say
four years, exceeding what would

O

be

logic behind

all

a

of

An

due to in¬
therefore illusory.

release

which

this

and

for

reasons

gains

embodying

owner-occu¬

particular

would

share,

both of
these potential sellers would prob¬
ably feel free to sell, and revenues
to
the Treasury would
be sub¬
stantially greater than under the
present arrangement.

limited

a

of

capital gains

to

value

an

The

case

dwellings.

capital

ited

this provision is that a large part

This

per

capital

identical

the

existed
proceeds in a

within

sell

to

gain

a

the

asset

in

of all

his

have identical

time without tax penalty. This is
the type of provision which now

pied

of

,

provision in which

taxpayer who wished to sell

asset

exists

1.4%

His tax liabfl-

at $160.

year ago

Thus, the capital gains tax,
functioning 'as
a
transfer * tax,
operates in an entirely different
manner
on
two
taxpayers who

to
at

as stated earijer> that it would increase the
already existing tremendous incentive
to
convert* ordinary in¬
come into capital gains,

similar

that

sale.

theoretical

The

over

paid

assume

holder would probably not be pre¬
vented by the tax from making a

increase

revenues.

situation

taxpayers

taxpayer

circumstances

us

or

affairs is obviously discriminatory.
A

Let

ity would be only $2J)0

taxes

than if

years

instalments.

is

in

more

these

sale.

a

a

the other holder bought, the stock

Humphrey and his predecesSecretary
of the
Treasury
have both stated that lowering the

that is to say, a

Incomes

his
ex¬

or

that

sor

a

Averaging of Variable

23%

of

rarely

a

of

of

sale would thus

a

Mr.

rate

us

In practice it is only
under

make

to

taxes

i

would

Therefore, it would be completely logical for our association,
other measures of relief which
take the position that a ceiling would
not require a reduction in
on Federal
taxation of earned in- the tax rate would include
provicome should
be placed at a rate sjon for some sort of
"roll-over,"
come.

holders

two

share,

per

tremely

relief

of

measure

of

event

$40

capital.

the tax.

from

the

be

them, it is believed, would
revenues

of

case

Would be to lower the rate of tax.,

arithmeti¬

at .least,

better

uring out

|

Addressing .V ourselves

is

that

duction in

reduction

tax

reform

than to

of

The

happens ; when
tax

speaking

progressive

*

Income tax

income

of

time

its

weight

its

what

of
ef-

income.

new

part

more

devote

Under these conditions

industry

technical mat¬

Developments in Eu¬
rope and the Middle East suggest
that, although the current fiscal
cash

high

capital

tax reform.

hardships."

tial

to

place

"unintended benefits and

year may

convert
at

principal long term
objective—a reduction in capi¬
tal gains taxation—it should also

reduc¬

new

to

taxed

tax

To date hearings have been

gress.

into

would

actively discussed in

first session

and

income

of

pres¬
means

gains, taxed at
relatively low rates. Therefore, it

of ris¬

process

taxation,
we
by the same route.

climb down
At

the

put tremendous

avoidance

forms

were

on

sure

Maynard

the form

a

the witnesses

the fact
that the punitive rates of personal

•

duction should
take

by

to

incentives

good

a

avoidance

tax

exactly

subject of '"Federal Tax Policy for
Economic Growth and Stability"

rolls

for

effect

the

have

would

ameliorating the locking-in as¬

pects of the capital gains tax—and

bad situation is

a

positive

provided

are

persons from

of

when

created

earning of

hearings

which

ductive citizens,

economy

fort to

cutting great
numbers

reform.

rates, it is obvious that
such as ours, which
must grow and therefore avail it¬
self of the full energies of its pro¬
an

these citizens

ours.

as

have

effect

the

Both, see¬
ing it sell at 170, conclude that
this price is too high and that an¬
other investment would be prefer¬
able. Let us imagine that the first
of these investors bought his stock
at $10 per share. His tax liability
in

our tax laws
respects economically

in many

practical illustration

a

working of that idea, let

Bethlehem Steel stock.

"high level" bi-partisan Federal Com¬

a

taxation to undertake genuine tax

on

Nevertheless, since
are

might be¬

the

give

of the

of 50%; averaging of variable incomes;

a

limiting capital gains tax to

America,
Convention,

Taxation Commit¬

tee, of which he

Federal

on

take

Hollywood, Fla., the report

of the Federal

ceiling

a

taxation of earned income at

of

Annual

Walter Maynard calls for placing

;

>

Volume

cally

Number 5594

184

for

press

.

.

The Commercial and Financial Chronicle

.

cost

increase in the

an

present nominal dividend credit.
Taxes

Security

on

■

change in the method of

as¬

Federal transfer taxes is
consideration, which
will have the effect of altering
the method of computation to one
under

thought

ket,

circumstances

increase

be

sharply.

effect

Efforts to

ent

ease
con¬

the

this

Mills

House

Tax

of

Ways

on

not

should

may

his

the

and the use of short sales to post¬

endeavor

of

dealers in tax-exempt seare exempted from amor¬
tization
of
bonds
disposed
of

these,

will

the

not

by

liability,

freedom

determine

to

which

he

will

restricted?

be
ini

his

to

the

incur

After

self

own

pick

taxpayer

whether or
why

choose
incur

at

tax

all,

interest

particular

liability.

curties

within 30 days.

or

of

price which will result in the
greatest amount of capital gains

recognition of capital gains.
first

price

liability
he

Since

will

he

these,
especially
the
amortization of premiums on taxexempt bonds held by dealers,

the

freedom

whether

to

time.

already

of

to

of

markets which may exist at a par¬

present code. The financial
community has
an
interest
in

respect

recognition

and

the

With

short

the

on

ticular

pone

of

use

complete

as

Conclusion
In

The effect of this

considering the prospects for
our goals of tax relief

exemption is, under some circum¬

achieving

stances, to enable dealers to real¬
ize a higher rate of tax-free in¬
come than if
they were required

and tax

to

amortize.

existing

The

for

reason

exemption is

the

the heavy

be

classified

the

under

Richard J. Stern

Kansas City

because

have

we

elected

Dem¬

a

ocratic

Congress, a situation has
been created in which, in the very
nature of things, we are unlikely
to get really constructive action in
the tax sphere.
would

this

would
to

us

seem, therefore, that
be a logical time for

for

press

would

a

the

overcome

stacles

to

reform.

political ob¬

Such

could be found in the

bi-partisan

a

broad

which

means

means

a

creation of

Commission
to

powers

with

investigate

The

(Special to The Financial Chronicle)

LOS

Stutz

Company,

Inc.

affiliated with

become

Hemphill, Noyes & Co., 510 West
Sixth Street.

Davenport
Mark

ANGELES, Calif.—Paul I.

Gould has

White-Phillips

Sullivan, Jr.

Lester, Ryons Adds

Auchincloss, Parker & Redpath
Washington, D. C.

(Special to The Financial Chronicle)

LOS

Frank T. Trubee, Jr.

ANGELES, Calif.—Jack E.
Jr. has been added to

Andrews,

Trubee, Collins & Co.

the

staff

623

South

of

Lester, Ryons & Co.,
Hope Street, members
of the New York and Los Angeles
Stock Exchanges.
He was for¬
merly with Hill Richards & Co.

Buffalo
Gus B. Walton

Walton & Company,.Inc.

Little Rock

our

structure

Carl N.

and

whole

Federal

make

recommendations

tax

im¬

for

provement.
This Commission should be ap¬

pointed by the President and
composed of persons of such
minence

and

prestige

recommendations

that

would

be

em-

their

be

ac¬

Ingalls & Snyder

ceptable to the leadership in Con¬
gress of both parties.
The creation of such

Members New

Commis¬

a

sion would have the effect of lift¬

ing the whole problem of tax
form

above

the

York Stock Exchange

Members American Stock

re¬

Exchange

of partisan

arena

politics, and it could be expected
would produce recommendations
on which a substantial bi-partisan

100

BROADWAY, NEW YORK 5, N. Y.

majority in Congress could agree.
Your Committee is confident of

the

basic

soundness

of

our

posi¬

tion

in

reform, which your Com¬
mittee believes are strongly in the

that

a

public interest, it is evident that
the obstacle that is by far the most
difficult to overcome is that which

gested, would produce a program
which
the
membership
of
our

tax

matters, and believes
high-level and impartial

body, such

that which is sug¬

as

Association

other

and

American

businessmen could endorse.
The

sions

BROKERS

BONDS

MUNICIPAL

IN

idea

of

of

reports which have had

BANKS

DEALER

is

not

Halle

a

islation
of

&

Stieglitz

one;

ful influence

AND

prestige

it has been used with
great success by the British, and
such commissions have produced

new

FOR

DEALERS

impartial commis¬

great

on

52

WALL

STREET

NEW YORK

a power¬

5, N. Y.

thinking and leg¬
An example

for decades.

such

report is the report of

a

the Beveridge

Commission, which

MEMBERS

TELEPHONE

laid the foundation for the entire

EXCLUSIVELY

NEW

structure

social

of

in
England and in this country. We
badly need such a Commission to
overhaul

entire

our

YORK

STOCK

HANOVER

EXCHANGE

2-9050

security

Federal

tax

AMERICAN

NEW

STOCK

YORK

CHICAGO

EXCHANGE

EXCHANGE

COTTON

BOARD

2ABLE

OF

ADDRESS

"PEACEABLE,

TRADE

BRANCH

N.

Y."

OFFICE

structure.
COMMODITY

J. J.

KENNY CD.

EXCHANGE,

NEWARK

INC.

N.

J.

Respectfully submitted,

NY 1-3082

DIGBY 4-9440

TAXATION

FEDERAL

COMMITTEE
Walter

Maynard, Chairman

Shearson, Hammill & Co.
New York

Albert

UNDERWRITERS

and

DISTRIBUTORS

Marshall

&

Seattle
Thomas

of

Foster

O.

Foster

Graham

The Bankers Bond

Co., Inc.

W. H. Morton

&

Co.

Louisville

CORPORATE SECURITIES

INCORPORATED

Benjamin H.

Griswold, 3rd

Alex. Brown & Sons

RIGHTS

Exchange Place, New York 5, N. Y.

James E. Hogle
J. A.

& Co.

Homer O'Connell

Hogle & Co.

HAnover 2-5620

Salt Lake City
James M. Hutton, Jr.

W. E. Hutton & Co.

INCORPORATED

120

Suite 3811, 20

Baltimore

Underwriters

Cincinnati

5, N. Y.

BROADWAY, NEW YORK

Stewart R.

Telephone

Bell System Teletype

DIgby 4-0770

NY 1-1896

Omaha
John P.

—

Dealers

Kirkpatrick

Kirkpatrick-Pettis Co.

STATE AND MUNICIPAL BONDS

Labouisse

Howard, Weil, Labouisse,
Friedrichs

&

Co.

New Orleans

James C. Lancaster

Emanuel, Deetjen & Co.
ESTABLISHED

1929

American Stock Exchange

Commodity Exchange, Inc.

Midwest Stock Exchange

Members New York Stock
Members American Stock

Exchange
Exchange

James K. Miller

Schoellkopf, Hutton & Pomeroy,
.

New York

FOREIGN SECURITIES

Bacon, Stevenson & Co.

Spokane

Inc.

UNDERWRITERS - BROKERS - DEALERS

CORPORATE, MUNICIPAL &

Memphis

Murphey Favre, Inc.

MEMBERS
New York Stock Exchange

Union Planters National Bank

Harold M. Martin

ff

municipal

bonds

George A. Newton
G. H. Walker & Co.
St. Louis

120

Broadway

New York 5, N.

Y.

Telephone DIgby 9-0777




Teletype: NY 1-1973

.

/i
>

§)

iJ

CO.J

[

Cable

Address:

EMANSTOCK

Edward P. Prescott

Prescott, Shepard & Co., Inc.

39

Broadway, New York 6, N. Y.

Cleveland

Telephone DIgby 4-4100
Ralph W. Simonds
Baker Simonds & Co.

Detroit

49

With Hemphill, Noyes

Stern Brothers & Co.

has now had four years
of Republican
administration, but,

country

It

the

postpone

has

Means is holding hearings on cer¬
tain "unintended tax benefits" in

some

re¬

situation is that the taxpayer

choice

Benefits"

Subcommittee

is

making a sale he will elect to be¬
come subject to a liability for cap¬
ital gains taxes. He also may pick
his time with complete freedom.
The short sales device merely per¬
mits him to
take advantage
of

meeting is going

Committee

case'of

to

now

-

"Unintended

of this mar¬

users

Association

capital gains, the logic of the pres¬

tinue to be made by your associa¬
tion.

While

the

sales

to

probably

should

this

and

In

present rates of transfer

tax rather

this

will

for

best

can

general heading of "politics." Our

sisting this change.

logic, the effect of the tax under
certain

held

incease costs to

While
considerable

has

im¬

quiring amortization would be to

based upon market values.
this

be

only a few
days. Since price spreads in this
class
of
security are character¬
istically narrow, the effect of re¬

sessing
now

securities

on

Transfers
A

would

dealers if they were re¬
to compute amortization

on

quired
Excise

which

burden

posed

(2545)

50

(2546)

The Commercial and Financial Chronicle

Continued

from

119954076

40

page

Repozt of IBA Special Industrial
Securities Committee
and

(2) .8 pounds of coal per kwh
will be used for additions through
1970 and .7

utilities is, of
uncertainty as

subject to
to
the probable
extent of competition from atomic
power.
With this cloud, if only
psychological, on the horizon, it
seems ironic that the AEC is pres-

pounds per kwh there-

after.

These estimates represent aver-

annual increases to 1980 of
approximately 13 million tons for
public utility electric generation
age

No

alone.

allowance

is

made

ently using nearly 10%
nation's total output of

for

than 50 billion kwh

power—more

possible rise in privately gen- in 1955.
The AEC is now, inelectric power, which to- directly, one of the nation's orintailed 73 million kwh in 1954, ex- cipal coal consumers. The Shaweluding
self-generation
by
the nee steam plant of the TVA alone,
AEC. In 1954 consumption of coal one of two serving the AEC inby electric utilities was 115 mil- stallations at Paducah, Kentucky,
a

crated

lion

tons, and

in 1955.
tion
to

can

be in

to

rose

140 million

burns

By 1980 utility consumpbe reasonably estimated
the

tons

neighborhood of 440

Estimating the

•cf

coal

Atomic

consumption

by

day.
to

hour, 14,400
facilities
atomic fuel
million tons of

per

To

date,

produce

per

The atom's

year.

terbalancing influence

Power

Ions term

tons

require about 25
coal

from

per

planned

million tons.

Competition

600

of

trend

electric

primary

energy

coun-

as a source

for generation

of equivalent amounts of electric
Additional Coal

Electric

By-Product

Total

Dealer

'o of Total

Ovens)

Domestic

Deliveries

Domestic

16.6

20.5

100,586
99,163
89,747
90,299

63,743
86,009
95,620
80,610
83,262
101,398
103,309

13.7
18.4

18.1

19.4
21.8
24.7

112,233

..

26.3

115,2)5
140,470
+104%

31,7

is still well

the

future,

powered

sured

(capital

with

,

the

151.5

60,600,000

216.7

162.5

65,010,000
64,654,000

and

345,714,000

Valley.

The cost of fuel will

plants

in

the

20.3

500,386
545,891
519,909
445,538
454,202
468,904
418,757
426,798
362,986
423,315

25.9

23.5
25.8

19.1

76^551

16.3

63,393
61,295
52,616
53,762

16.3

111,479

26.6

14.4

112,611
92,477
106,234

25.5

23.5
25.4

•

14.5
12.7

-46%

government

25.2
26.2

25.4

25.1

-23%

large

ac-

-16%

hydroelectric

sites

are

ex¬

„

allocating

in

commercial

installations

be

to

tremely

and

the bulk of the
required for this

scarce,

electric

for

large

energy

annum.

contemplate

mines

to

years

optimistic

^.an

Bituminous coal companies with

primarily

as

some

most

now

by

Consolidated Edi¬

as

regarded

The

rnore

that

no

°/ total

P°wered in 1975.

1

tentative

Steel

steel

coal in

the United

ture and subject to revision as the
develops,
but
they

Ii under the

sumed

most

plentiful

mineral

an

scope

nually,
above

and

a

is

•

ft

Projectmg fufure growth

only 10% compounded annual-

in

bave reduced

rate

required
the

ly weremsed, the FPC estimates
piled above; Would haVe to be
154

of

ise

Would

produce
in

crease

FPC

ioi

1975,

nearly

50%

a

consumption

estimate

for

ther

In

the

,

,

the

—

,

estimates,

adjustment for
nuclear energy competition-at this,.
juncture would, appear unpecesfor

scry

our purposes.

'hydroelectric

quently

of

and

power

current

^OI1

per

of

subse¬

generated

0£

does

as.

and

taconite
fur-

ore,
ore

in open

industry coal

may

production of special
of steel.
As a

and
of

types

these

factors

coal

con¬

per

ingot

ton

of

steel

from

declined
to 0.93

bearing on steel
coke consumption

a

or

ingots produced,
development of elec-

the

sumption

....

hearth opera¬

s^eci

tric furnace

v' result

first

abuser

sintered

,

used

grades

Aluminum

Traditionally^

beneficiated

tions also have

light of the indicated conservatism
ol

iron

increasing
grade Labraan

high

unit coke
consumpin¬
Variations in the amount of

scrap

'

amount of coke

of pig
of

reduce

tion.

the

1975.

of

pellets and

in-

over

introduction

dor ore>

similaily,

7% rate ot annual growth

a

the

ton

per

proportion

_

laised

one

the expansion in steel
output. Advances in blast furnace
techniques

year-

a

con-

of

Consumption of coking coal has
been characterized more by rela^ve stability than
growth despite

of

hlectric energy consumption

production

^In

an-

13%

so

the

ton of steel.

fuel.

currently
far this

year ago

in

our

of 14.5%

average

category of coke. Ap-

proximately .9 ton of coal is

fbejast^ecade, electric output has
lncreased

^

States. Its his-

demand is shown in Table

nevertheless

ample

\

industry represents
largest consumer of

second

torical

situation

suggest

•

•

the

na-

.for using the vast deposits of

'

■

The

Even these optimistic forecasts

be

Valley

as planned alumicapacity is expanded,

num

-

a

River

increases

u

Power output will be atom

of

Ohio

deliveries of coal, and for substani

are necessarily

the

already benefited through
the receipt of long-term contracts
which provide for sizable initial

onn^nr0o
200 billion kwh,
Mr.
oI American Cas
& Electric believes only 5.2 % of

Ohio

in

have

esti¬

W1J?

using
conventional
fuels,
only 4 to 6 mills for the most
coal

with

mates

still

modern

17.3

86 604

26.4

between

come.

matic),

72,450,000

913.2

27.5

137,603
146,62)
1j2,393
lb,270
114,522
123,022

13.2

22.9

policies

experimental

areas

1,217.8

Consumption

23.3

by

utilities such
son

of

202.0

Domestic

Domestic

,

costs

cost

20.2
v

"•

% of Total

24.2
*

„

ance,

from

1965-1970

fuel

19.2
20.6

Total

Other

Industrials

P-ow^ °"ers -an earv competi- come from bituminous coal. The
!"ive^rfa^ orjty
the extent that aluminum industry, in the future,
may he subsidized by the gov— may consume as much as 10 milernrbent. to accelerate its accept- lion tons of bituminous coal per

as-

though several large utilities are
contemplating atom - powered
plants, present estimates are that

delivered

"

Retail

muitary applications, it would expansion of primary aluminum
seem'
therefore,
that
atomic capacity probably will have to

and the safety factormust

but

3.6

c0.,.®

generating

be such as to satisfy not only the
local communities served but also
the
insurance
companies.
Al¬

included

4.8

counting

of atomic fuel must be

power

6.5

.

source

installations

13.4
11.5
'9.1

determined

plants are to offer effective competition, costs per kwh must be
competitive,
an
uninterrupted

cosf of

15.3

*

the basis of known facts.
-

18.2

—86%

in

% of

83,238
104,800
107,306
91,236
103,845
113,448
97,614
112,874
85,238
107,376
+29%

20.0

27,735
17,370
15,473

33.2

*

atomic

22.0

110,166
109,296
94,838
68,123
60,969
54,005
37,962

:

15.7

1960-1965

Total

following tabulation

(Beehive and

largely problewill range from 7 to 11
mills per kwh compared to 8 mills
for plants in the mid-continent

207.0

the

% of

83,000,000

276.0

in

Total

207.5

j

Lignite

shown

Domestic

276.6

1975-1980

and

is

Class I

1955-1960

1

1946

Tons)

Railways

Requirements (Tons)

184.7

Net

Domestic

75%

246.3

since

of

% of Total

(Billions)

1970-1975

coal

Power

Change

atomic

for

Utilities

1955....,

If

,

Coke

1954.....

0

market

the

(Thousands

1«>.

major

KWH Increase

Consumption of Bituminous Coal

1952./.,.

power

■!

■

The change in the character of

1940...,.

of the
electric

Thursday, December 13, 1956

.

TApLjE I

1943

course,

.

.

H

/r

1.12

tons

in

1946

tons in 1954.

by

The contemplated expansion of
,gas-fired steam powervaluranum,
slcef; mdustry v capacityf- wbich
iisjnow expanding in the coal pro- shoi!ld range from 20 to 25 million
ducirg areas which haooen also
t

•

I to.be close; to-major aluminum
rrhrkets. With about 10 kwh
rer

|. .?er. Pbfhd- of alumtnupi,

k'tctricity
adjacent

oral

per ton of steel ingot capac, ,of 15-18 million tons.
T:J
'
-:
/ v.

reduction plants

new

,

Railroads

jstetions -which in turn,
w

based

on

total transactions last

producer

i

it*

year
100

.132-.176c
steam
...

in the

a

seller makes

sale,

a

a

buyer makes

a

the

buy

big high-speed Government hojjd market

at

kwh).

abiy

W hen you phone us to
sell,
you

hang

up.

When

want "in stock"

This is

one

world.

It is

customers.

or

of the
used

you

clcse

phone

to

the sale

will be made before

buy, we'll probably have what

you

by.

largest

primary markets for U. S.

freely by

Why don't

us

are

you

our

customers,

try us?

our

Governments in the

correspondents, and their

Phone STate 2-9000, Chicago.

-




and

compares

of

favor-

charges for
kwh close to

supply and

is

The

lack

of

major

unexoloited

resources

in

the

country and the availability of
cheap bituminous coal in the Ohio
has

led

four

companies—

OJfu Mathieson and Revere Copper jointly, and Kaiser Aluminum,
and
Aluminum
Company of
America
locate
in

to locate or plan to
basic aluminum plants
Indiana and West Vir¬

The total capacity of these
plants is in excess of half a mil¬
tons

a

year.

In

produced

addition

by

low

to

cost

NATIONAL

Company of Chicago

BANK

total.

,1

domestic

3.6%

of course,
It

is

ever

road

to
of

15

the

shows the

of dieselization

the coal

1955

declined

mere

will

con-

By

year.

of the

na-

doubtful

again

major market ^ coal.

be

if
a

However,

industry's loss of the railis a faci of the past.

market

Research is currently under way
the
development of a coal-

on

fired

gas

cessful,
ln

turbine, which, if suc¬
bring some increase

may

CGal

consumption' by railroads.
any case,
future demand for

In

coaj

j^y rai]Ways is projected at a
minimum figure of 5 million tons
a

year..

Retail

Deliveries

Retail consumption of bitumin¬
ous coal has also
declined sharply
in the past decade from 101 mil¬
lion
this

to

As

a

railroads.

raiiways

and

ity of 1.7 million tons by 1970.

that

tons,

This,

effects
tion's

bituminous coal, these plants will
enjov substantial
transportation
The aluminum industry contem¬
plates doubling its present capac¬

of total

in

consumption

million

new

Ohio,

lion

tlieir

States.

hydroelectric

Valley

COal^ 22%

sumption

savings.

ILLINOIS

and Trust

Member Federal ItejROsit Insurance .Corporation

ton

pounds of coal

prevailing

sources

(assuming

per

of about .13c per

gas

electricity

*

.8

the

°a

/

ginia.

P. S. Try Us for Municipals Tool

CONTINENTAL

$440

to

in the United

like hotcakes here at the Continental
Illinois.

the chances

kwh

This

with

^°S

lower than the cost of competitive
fuels per kwh in any other region

Continental Illinois
over

at

bave

can

f

per

of .6

primary

Government bonds turn

3

•

coal

use

per

the

are located :.vIt1^946 Class .I railways used
the mine, the _aJur .4.^ million .tons of bituminous

' practically

i
average,

tons

to

market

manent.

natural

be

coal.

54

loss

The

million
is

tons

probably

convepience

gas

is

offset

by the

Since

the

far

too

and
per¬

of

lower cost

present

oil

great

level

of
of

residential coal consumption
seems

to be at

a

-

I
'^^4 **

x

_

to "-electrics generalmg*~~ ~

-

should

c,eate additional demalld (assum,jng a requirement of .9 tons, of

a -.major.-.cost. item.M.(

is

;By, locating

-tong in the next five years

minimum, stahil-

Vqlume 184

ity

of

the

about

the

Number .5534

retail

market

coal
that

worst

.......

be

can

ticipated within the normal
of

the. business

retail

The Commercial and, Financial Chronicle

is

an¬

scope

cycle.- Thus, the

market for

coal

be

can

ex¬

pected to remain at about 50 mil¬
lion tons per year in the future.

costs preclude their

production

commercial scale.

a

try thus

has

(2547)

The following

on

Coal chemis¬

,v

mar¬

excluding

the

amounted

production
able

about

to

in

1955.
of

amount

rently under
coal

25%

of

consider¬

A

research

is

cur¬

the field

in

way

coal

of

sell

to

the

residual

'

Gas

cannot

Since

ical

a

Hydro

is

coal

the

subject

with

ated

technical

the

process has been demonstrated, no
large-scale operation has resulted

to date.

ify

It is also possible to gas¬

coal

underground,

almost unlimited

an

Conservatively, it
future

^Estimated

Demand

of

a

1951

1952

185,204
56,616
28,712

195,437

391

prospective

derived
from
crude
petroleum can be manufactured
from coal but at present relative

coal

nous

tively

summarized
1970

250

195

Railroads

310

177,314
78,425

200,238

233,203
95,938

270,923
99,750

294,121
105,102

337,431
105,233

364,618
107,068

433,683

82,470

201,351
89,748

112,721

+ 43%

255,739

282,698

291,099

329,141

370,673

399,223

442,664

471,686

546,404

+145%

Power

5

Coke
Retail

5

5

130

135

70.8%

69.2%

70.8%

73.1%

73.6%

76.2%

77.3%

29.2

30.8

29.2

26.9

26.4

23.8

23.7

50

50

67.3%

66.2%

68.4%

66.5%

64.8%

65.6%

70.0%

13.0

13.0

15.0

18.3

19.1

20.9

23.3 " V

23.7

25.7

9.7

9.6

8.4

14.2

14.5

10.6

10.1

11.4

8.6

.1

.2

.2

.2

.2

.1

.1

.1

.1

'.

....

Total

110

110

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

Total......

50.0%

53.5%

54.0%

46.6%

47.0%

50.0%

49.0%

49.5%

50.7%

55.5%

KWH......

1.23

1.26

1.25

1.19

1.06

1.03

0.99

0.95

545

a

1.10

610

Coal

1920-1924

Average

1930-1934
1935-1939

"

5

1940-1944

"

145

1945-1949

:;i y

110

1951

1953

750

1954

lasting export business has been

Preliminary..

^Includes

466,071
509,992
359,055
381,555
529,294
514,258
426,329
454,202
468,904
418,757
426,798

1950-1954

50

675

i

m

Competing Fuels and Power in the United States
^

Bituminous

1952

II

1.14

TABLE
Use of Bituminous Coal and

440

110

110

30.0

of

1950

Industrial

79.4%

per

Coal

Pounds

bitumi¬

50

50

+200%

20.6

76.4%

1925-1929

140

N.A.

77.2%

Oil

1980

5

125

-

N.A.

Commission.

Petroleum

370

264

77.2%

Gas

(Millions of Short Tons)-

Electric Utilities'

390

390

69.4%

conserva¬

1975

481

386

30.6

(thous. tons)
1965

29,750

28,547

N.A.

64.8%

follows:

as

+171%

68,453

Coal

for

might be

years

Increase

302,441*

433

(exclusive of export) in

normally

coming

demand

1955

239,146
93,688
31,520

1953

331

major

competitive with natural gas. In
addition, a variety of products

1954

218,846
79,791
38,404

16,925

36,967

Against
this
background
for
coal consuming markets,

but the delivered price is hot yet

KWH)

1950

154,520
44,559
33,734

SOURCE—Federal

.Waste

Domestic

Bituminous

for

of

1949

135,451

35.2

coal

year.

Future

1948

152,910
30,123
16,762

of Fuel-Coal

%

Projection

of gas,

Generation by Energy Service

Hydro

be estim-

can

industrial

ly 110 million tons

providing

source

that

decade.

past

•

223,178

,

consumption will be approximate¬

of

States for the

n

Fuei

separate chapter, no further
consideration is required here.
a

the

feasibility

United

144,772
78,406

Fuel....

Total

discussion of chem¬

a

for

uses

in the

energy

216

......

Total

significant,
contributor to vol¬

soon

independent
ume.

time and

some

become

re¬

136,985
23,073

18,820
14,082

.......

Oil

however,

1947

111,654

Coal

BTUs

chemistry.
Union Carbide,
example,
is
experimenting
coal
hydrogenation.
While

for

1946

Energy Service

Waste

industry will,

main derivative for

of

power

TABLE

-

•

This

coal,
industry,

steel

of electric

sources

(Millions

improving the competitive
position of coal by making it pos¬
for boiler fuel in the form of char.

for

uses

indicates the

or

sible

Industrial Demand

General industrial

table

•>'

362,986

Natural

Anthracite
(thous. tons)

78.433

22,212
56,327
49,920
54,940
48,320
33,020
39,900
37,000
35,300
28,000
24,900

utility and non-utility.

bbls.)

SOURCE:

electric*

Coal

-Percent of Total

on

B.t.u. Basis-

(million

(thous.

268,947
376,001
354,165
456,367
673,055
894,272
1,154,326
1,082,871
1,150,780
1,171,069
1,184,585
1,182,325

Total

Bitu

Hydro¬

Gas

Products

(million

Equivalent

Bituminous

Anthra¬

Petroleum

Natural

ft.)

kw-hrs.)

(thous. tons)

Coal

cite

Products

Gas

cu.

V

20,043
32,500
35,975
45,104
65,229
86,546
107,262
100,885
104,376
109,708
109,617
111,723

528,416
770,200

915,747

1,302,544
2,021,655
3,069,465
5,644,377
4,428,079
5,234,269
5,761,325
6,207,311
6,590,900

Above table taken from

651,382

71.5

.

70.1
727,931
64.1
559,977
61.5
620,374
61.3
|
862,267
1 944,649
54.4
42.5
1,004,053
46.4
975,992
45.2
1,034,580
41.5
1,008,855
41.5
1,028,321
972,519
37,3
"""HI i*I
ITITOnh
,

.

Bituminous

Coal

Trends—1956

Total b.t.u.

Hydro

trillions

11.7

9.6

3.3

3.9

9.6

12.1

4.2

4.0

9.8

14.7

6.6

4.8

85,531
95,359
73,357
81,269
112,957
123,749
131,531
25,571
27,106
26,432 '
26,942
25,480

17.1

7.8

8.4

5.2

6.2

18.1

9.4

5.0

5.0

21.7

13.0

5.9

3.2

26.0

22.5

4.0

25.2

18.2

6.2

3.5

25.2

20.3

5.8

3.4

26.2

22.9

6.0

2.6

26.0

24.2

5.7

2,5

27.3

27.2

5.7

(National

Coal

5.8

Association).

laid.

An

Analysis of

The

coal

United

fall

States'

and

main

those

the

to

Europe's

cate¬

Europe, those to
of

rest

Sjt

*

of

exports

intothree

gories—those to
Canada

Export Markets

The

Coal

Needs

postwar recovery of West¬

Europe

ern

i'n

little

is

short

of

world, principally Latin
America.
Over
the
years
the

miraculous.

sales

short years ago are in .many cases

the

to

ica

Canada

have

terms

of

United

not

Latin

and

Amer¬

much

not

Factories which

ranked

total

States

have

and

than

more

..large Un turning out
production in the the prewar

goods

more

teri;

than

Over-air

years.

were

rubble

-

in

man¬

shown

ufacturing production for Western
minor annual changes which have Europe was approximately 170%
of the 1937 rate in 1955, according
reflected
shifts
in
world
wide
statistics
published
by
the
business conditions.
The exports to
to

United Nations. The rise in stand¬

Europe,

have

been

on

the

other

characterized

hand,

by wide

fluctuations, with large shipments

following
at

the

both

time

of

in

the

World

Wars

and

ards of

living

ulated

the

people,

be

a

well

the

coal

strike

Twenties.

brought out in the following

As

for

para¬

graphs, small growth in line with

increasing industrialization

can

be

expected for Latin America, while

only

negligible

changes

can

be

Canada, since

in¬

creasing over-all demand for

en¬

anticipated

ergy

by
gas

will be taken

the

care

of largely

the newly discovered
resources.,

ments
ord

for

to

ship-,

the major question

overseas

picture

or

in

whether

is

temporary "emer¬

desires

of

appears

to

which

augurs

growth.' To

growth,
the

rise

to

years

sup¬

needs
rather

energy

expected

sharply in

ahead.

The

Energy Commission of the Or¬
ganization for European Economic

Cooperation, in a report released
last
June, stated that the con4
sumption of all forms of power
the

by

17

member

nations

is

expected to rise by approximately
one-half

the

to

equivalent

of

1,200 million tons of coal by 1975;
The

Fifth

World

which

ence,

last

this is another
.

coal

Europe running at rec¬

highs,

gency"

With

oil and

spirit

future

this
be

can

to have stim¬

and

there

and

new

in

port
Britain

seems

wishes

the

was

summer,

Power

held

Parliament

since it

was

Vienna
"A

Energy"
by approxi4
delegates from 24
on

attended

2,300
and

European

26

overseas

Continued,

whether the basis for

Confer-*

at

has been called

World

mately

on

coun-

page

52

Underwriters and Distributors
>.V

.

.

...

.

..

■

*

of

INVESTMENT

SECURITIES

J.A.HOGLE&CO.
Estab. 1915

Los

Angeles

★ Members New York Stock

Salt Lake City

-Beverly Hills

Denver

Exchange

San Diego

Reno
__




The First National Bank

New York

Ogden
Idaho Falls

Missoula

Provo

Pocatello

Boulder

ofChicago

Butte

Riverside

Long Beach

51

interesting implica¬

tions through, raising profit

gins

>•

\

—

.

Spokane

BUILDING

WITH

CHICAGO

S INC

E

1

8

6

3

52

The Commercial and Financial Chronicle

(2548)

Continued jrom page

United

It

that were presented

papers
cerned

Light

Recent Technical
Developments."

of

would, of course,
be a great boon to Europe and,
because of higher generating costs
than exist in this country and the

and
The

could

that

conclusion

%

a

Atomic energy

in the

Resources

Energy

Economic

only

con¬
theme of

conference

the

"World

be

is

coal

lor

*

1956

*

de-r

litical events in the Middle East,
exchange problems and the price

warning.

this

underscore

to

Western

relationship between coal and oil
will all have a bearing upon the
amounts
of
petroleum products
and
coal
imported
by Western
Europe.
Furthermore, favorable
political developments could reh
suit in Poland's supplying a siz¬
able share of the coal needed by
Western
Europe.
Nevertheless,
there appears to be enough evi¬
dence to point to an
expanding

'.V

1"

■:

the

From

1920s
coal

1955

to

both

anthracite

and

a

to

that

there

was

acute

no

man

Europe as a whole
rather dismal one. According

the OEEC,

pected

its

it

years,

World

the

of

the

Con¬

Power

warned people over
misconceptions
concerning
the
development
of atomic
energy.

pro¬

own

future

of the Commission and Presi¬

has

ference,

Western Europe, on
plans, is ex¬

increase

to

in

dent

basis of present

the

problems

exchange

pated

Western

for
is

was

about

British

of

less

uted

thermal

anthracite

though

than

production

duction of primary energy sources

While

lignite, water power and
natural gas) from 584 million tons
of coal equivalent in 1955, which
was
broken
down
roughly
be¬

units.

coal

2%

the

of

Al¬

contrib¬
total

consumption

and

tween

coal

and

lignite

74%,

he

looks

for

a

rapid

of

oil

the

production is expected to account
only 63% of the larger re¬
quirements,
as
compared
with
80% last year. Without a devel¬
opment of new European sources
of energy,
the result would be
an increasing dependence on
im¬

i for

The

ucts.

that

fact

much

exchange

the

coal, crude oil and

out

it

that

prices.

In

addition

to

coal.

Prospects for U. S. Coal
So

ther

attention

far

increases

scheduled

ex¬

fact that

warned

the

increasing dependence of Western
Europe

on

ticularly
one

they

come

small part of the world.

has

has

create

million

undoubtedly in the minds of
but

the

been

Iran

commission,

S.
of

subse¬

be

at

Oct.

as

reported

5,

that

Walter

J.

millions

now

alone

in

or

in

view

carriers

his

the

exports
tons

of

that

alone
more

annually based

these

as

much

as

the

also

to

form

coal
be

25

to

In

rate

total

union
a

gasoline),
fuel

40%.

bitumi¬
of such

consumption

coal

all

between

to

Consequently, bi¬
still

dominant

stands

source

directly

of

out

as

energy

and
are

a

to

Coal's
water

Hydro-Electric

Power

oldest*

competitor
is
hydro-electric
power,

or

and

although this type of energy
production increased from 31 bil¬
lion
kwh .in
3,930 to about 112
,

billion kwh in 1955, hydro's share
of the total electric power out¬

put

declined

34%

significantly from
slightly more than 20%

to

in the 25 years from 1930 to 1955.
Most of this loss in percentage

participation by r hydro was exT
perienced in the last decade as
power

made

generation by
rapid progress.

other fuels

the

of

mine

making plans

to

Such

steps

will

increase exports

running at

approximately

tons in September,

an

annual

57 million

1956, since rail

Standing

Gas

out

competitors

Inroads

are

as

coal's

sharp growth

should also be noted that natural
gas
had
a
more
pronounced
growth trend in the postwar pe¬

riod inasmuch
of

source

still

period

but

the

in

natural gas as

as

natural

gas

and

remains the dominant contributor
to

the

total energy used by coal
competitive fuels. Since much
of the total production of crude
petroleum and natural gas go into

and

uses

that

are

coal, such

as

diesel

not competitive with

motor gasoline, cer¬
oils, lubricants and

black, the exclusion of
such
non-competitive fuel uses
from the total energy market is
required for a more realistic pic¬
ture
of
coal's
position.
Direct
competitors of coal as an energy
source
would
include fuel oils,
liquefied petroleum gases, natural
gas and hydro-electric power. On
such a basis, the nearly 6.6 trillion
cubic feet of the approximately

sumption
this

of

The

359

1930-34

depression period
with about 363 million

compared
in

tons

higher
the

1954,
soft

despite generally
consumption ^in
However, the per¬

coal

interval.

centage of total energy for which
bituminous

clined

coal

steadily

accounted

from

,

Notwithstanding the inroads

which

coal's

largest

natural gas and

competitors,
oil, have made on

markets held by coal

pansion

through the

the prospect of

years, or

some ex¬

of

hydro electric power
or nuclear
energy potentials in the
future, coal has stayed competi¬
tive as indicated by the fact that
it
still
remains
the
dopiinant
source
of energy among the di¬
rectly competitive fuels. Further¬
coal

more,

management

aims 'to

that coal remains competitive.
Steps being taken to improve the
competitive position of coal in¬

see

reduction

of

transportation

costs,

the improvement of coal's
utilization and the development of

aggressive sales-engineering

more

services and marketing aids.
In

September, 1956, the market
promotion activities of the Na¬
tional Coal Association

transferred

to

Bituminous

Coal

its

St. Louis

the

on

coal

bituminous
the

effective

more

through

to encourage

a

selling of
designed

program

the increased

coal

competitive position of bitu¬
coal in industrial, com¬

mercial, domestic and retail
kets.

One

of its

services




INVESTMENT

SECURITIES /

mar¬

will

be

to

provide engineering assistance

to

coal

order

consumers

and

others

in

to

promote the most effi¬
cient and economic utilization of
the

fuel.

In

this

connection,

gineering

Rapids

Denver

OF

of

minous

St. Paul

DISTRIBUTORS

use

sfnd to improve

BONDS

Milwaukee

AND

The

activities of BCI will concentrate

MUNICIPAL

Des Moines

UNDERWRITERS

the

Institute.

STATE and

Omaha

Galesburg

were

affiliate,

U.S. GOVERNMENT

Minneapolis

■,

in

en¬

specialists have been
8.4 trillion cubic feet of natural placed in 12 district offices located
in coal consuming areas with the
gas consumed in 1954 (the latest
year for which such comparative task of demonstrating that present

(INCORPORATED)

Cedar

de¬

64.1%

1930-34 to 37.3% in 1954.

New York

I

con¬

about unchanged at an
million tons during

was

average

the

larger 22.5%

1950-54.

bituminous

coal, on
direct competitive fuel

same

basis,

much

a

years

Central Republic Company

|

a

energy contributed a
9.4% in the 1940-44

modest

the

biggest

petroleum, with the former mani¬
festing the strongest growth trend
even though bituminous coal still

tain

South La Salle St., Chicago

The

clude the mechanization of opera¬
tions to lower production costs,
Natural

that

group

units.

natural gas as a competitor to
bituminous ,coal is indicated by
the fact that this fuel contributed

competitive

carbon

209

thermal

Making Coal More Competitive
Limits

It

shipping line to export

Europe.

were

of

large

tidewater.

at

be. mentioned

necessary

which

upon

spending

railroads,

operators

workers'

this

of

expand their coal-ship¬

three

mine

steel-producing facilities,

almost

facilities

should

could

than

is

Chesapeake <&

also

are

to

ping

of steel, the
metallurgical
coal

demand

He

optimism.

the

sums

are

of

annu¬

attainable.

seem

to

tons

devel¬

energy

mineral fuels and water power.

the

1956,

total

by coal and directly com¬
petitive fuels in terms of British

approximately 60 mil¬

Ohio, the other two leading coal

ton

estimated

of

present

quent action of Egypt in national¬

production

the

of

source

a

increased

be

tuminous

it appears

should

exports

recently

addition

With this type of
short supply abroad, it

source

the

basis

as

use

percentage

energy

and

among

U.

level

not

di¬

been

ton of coal is needed

one

for

in

from

was

over-all

an

ally

grow.

coal

outside supplies, par¬

when

produce

should

in

and,

one

demand

in

100

rected

higher

risks

1 85

totaling .100

to

the

15

•

-

change problems, the commission
against

35%

press

$1,900

the

would

78

total

can
be paid for with ster¬
Tuohy, President of the Chesa-:
ling rather than with short dol¬
weighs in its favor, although peake & Ohio Railway, expects
any
worsening of Middle East coal exports to jump 100% in
politics could work in l'avor of the years ahead, and that exports

petroleum

anticipates

65

65

As

prob¬

from

55

13

as

coal's

nous

lion tons in the immediate future.

principally
to
energy.
Some thought should be given to
million in 1955 to $5 billion in the
rapid rise in Free Europe's
1975 even if present prices were output
of steel, which in 1955
maintained, and it further points approaches 90 million tons. Fur¬
rise

would

products

10

f

latter

lem, since it believes that imports
of

63

lars

commission

The

fuels.

emphasized

52

that
a

.

ported

fuels

35

45

On

the

of

such

17

15

1970

coal

,

products
17%,
hydroelectric
power 8%
and natural gas less
than 1%, to only 755 million tons
in 1975.
In other words, its own

petitors

Total

Overseas

coal

the

against only direct com¬
(which
would
exclude

energy

(In Millions of tons)

1965

de¬

equivalent of 80
million tons, or less than 7% of
total needs.,
Therefore, barring unforeseen
developments, the bulk of West¬
ern
Europe's growing shortages
of power to
create energy will
have to be made up by importa¬
tions of coal and petroleum prod¬
only

bituminous

Exports

Canada

Measuring

gas.

1960

velopment after 1975, by that year
he
sees
atomic energy equaling

(coal,

ural

S.

U.

the

of

an
average of only 6.6%
of the
been accounting for a de-,
total energy used in the 1930-34
clining percentage of the total
period or less than a quarter of
production
of
mineral
energy
the current percentage level. -It
fuels and water power in terms

by oil and nat¬

following:

available) accounted for

are

27.2%

have

antici¬
energy fuels in 1955, bituminous
could
Europe s future de¬
coal still accounted for roughly
mand
but
considerable question come much more quickly than is
30%
of the total
energy
fuels
It should be demand for U. S. coal. Accord¬
about its ability to meet that de¬ generally believed.
produced and consumed in the
pointed out, however, that Sir ingly, recent and prospective ex¬ United States last
mand.
year,
despite
As a matter of fact, the picture Harold Hartley of Britain, Chair¬
ports
shape up something like the inroads made
reached

doubt

data

in

Competitive Fuels

bituminous

Thursday, December 13,1956

.

oped

*

m

pendent upon many developments
are difficult to gauge.
Po¬

the izing the Suez Canal has tended

of

number

large

year.

that

demand

the and port facilities are being used
to approximate capacity.

by

Europe

last

obvious

which

Securities Committee
A

States

is

Europe's

Report oi IBA Special Industrial
tries.

supplied

tonnage

51

..

NORTHERNMOST

(MEMBER MIDWEST STOCK EXCHANGE)

BANK
Financial

NEW

6-SSOO

•

BELL

SYSTEM TELETYPE

CO 368

YORK REPRESENTATIVE • IS Broad Street • Dlgby 4-7400 '

CHICAGO

Bell System Teletype NY 1-953

Volume

-Number 5594

184

.

The Commercial and Financial Chronicle-

.,

totaled ,$296
million for
these lion tons by 1975. This means that
years.
Only the burgeoning de- the -industry will not only have
matie' equipment,
is superior to mand generated by World War II to continue its present program
other fuels in most parts of the
and its aftermath brought mod- of
investment
in
labor
saving
country.
,
estiy profitable operations,
but equipment, but will have to de-.
; An example of the new organeven in 1949, earnings totaled only velop important new capacity to
ization's aggressive approach was $125 million for a net margin of keep pace with mounting demand..
the installation
of
a
BCI
coal- about 4.7% on a product valued As previously noted, present inheating exhibit at a recent con- at $2.6 billion. This poor earnings dustry capacity is about 550 milvention of school officials.
Per- picture slowed the technological lion tons, about 10% above pressons responsible for the selection
changes necessary to put the in- ent production.
It is generally
or recommendation
of fuels used dustry on a profitable and effi- believed
that this margin will
have to be increased somewhat,
in school buildings were favorably cient basis.
K',tro
Also, about 20% of present proimpressed by the advantages of
ductive
burning cost - saving bituminous
Gains in Cutting Costs
ductive capacity is expected to be

day coal, especially prepared for
customers,

in

burned

and

auto-

-

coal the modern

interest in

high

However,

and showed

way

labor-free

declining demand,
changes
began
to

equipment. Through
activities, BCI will strive to

obtain

the

effective

most

from

the

try's

substantial

sales

present

markets

retain

bituminous

conversions from other

fuels,

ticularly oil and natural
Annthpr

inHnctrv

to

win

or

par¬

gas.

cnnncorpri

ti.it, I, that o£ Automatic

used up over the next five years,
Altogether, the industry expects

profound to add about 250-275 million tons
take
place, of annual productive capacity by

qp

Solid

mVOSSjSS

srssKtiretsff sr. sorasftBCtf
mercial and small industrial busi-

mav
may

oreanization's

coal

natural gas, or if

cessful,

areas

oil

new

suc¬

After

consumers

...

..

,

bigger hitM nnt
bites out

on

royalty basis,

a

depreciation-depletion

4- k

HpplinpH

J'

number

QtpQrlilv

of

peak

a

k

M

A

the

1950

9,429

2

of

„

mines has

Alcn

rc

.

*

„

A good part of this requirement

On

this basis the industry will
be called upon to invest some $l1/-»
billion in new plant over the next

five

at

years

annual

an

rate

longer

over

a

of time hold true,

will

ure

investors

subsequent
reach

as

15

Jersey alone last
million

is

on

with oil.

par

a

of

source

.

Recqgnitmn by the coal industry

thAair°fm0 Vr/1 ?ffort® a™
worthy of exploitation is an indi-

Capacity

determined

hs

SOmn
some

mines

have
/»/

\r«4-

favorahlv
favorably

mom
more

-

recently

compared

ttrl

+V»

4" k

/\

IV*

cost with the
minPQ

the

as

npnartment of Commerce declined
Department nf PnmmprrpHprlinpH

*

unduly

structures

financing

equity

some

public

offering

securities
Of

will

to

company

Never-

well
debt

•

the quality of these

course,

securities

as

of

1

widely from

vary

en-

However,

company.

these factors might be pointed out

theless, in view of the coal industry's rather sad financial past, it

to
•'

affecting the climate of the

us

{"1

i

,

IU.!«lAlinB»"18SSS!

"ViVSS

sit.iint.Prt
situated

developed

satisfactorily in
expensive strip

/-V

»—* am

n*

**/*

n4-vti

mininof

**,hir.h
which

and

w

last

about

18%

suggestive.

the industry wUl again see

A

„

_• 1 "f

•

accounted
atiuumtu

year

i*A.

___

million
nnnfe

vpo,-

earnings"

i

after

'

of

•

ml

'

reserves for this
tvoe of mining will slow its furtype of mining will slow its fur-

put

oc/

pel

?.?♦

milli/*r»

in

Q3y

£
^^
deve v!?«u

riopntiv
^
J??®""?
„m

^
fS^er San
Y

day

and the

•

miners have

$5??*?!
difficulty

ions

no

in extraetn

rare

fi,po«

1 o**

+

Ayerage out-

I?;/1: 311 ITlineS IS
vf
In
'a" Jno Ilc iht year.

111311

V1""

™ ^a^
™ 3Q

dividends of $17 million these 11
pnmnanipc i-piainnH ana rr.inuncfr.ri
companies retained and reinvested
<cdA

1

be-

to continue to

show improvement.

probably will not advance signifi- depreciation and depletion charges
signilicantly above the 25%
cantly above the 25% of total yielded $26 million for a total cash
of total
production for which it now ac- flow of $61 million. After paying

Limited

i!Si!?,'
likely

S?
^™
margins are

$35

repre-

movnla

^

excess

fw,**
operations generally
a

^

_

This

taxes.

®

at which

for

iui

of the industry's total

reveals

output,

V*

nrnrliiptinn

revealing

is

compilation of 11 such companies

more

Rt.rin

the. counts.

by

-n

capital

will probably be necessary

of

spent $670
improvements

and coal, as a basic
ergy,

without

year

capital

on

loans

overbalancing

But Standard Oil oi New

money.

in-1

of

195S;

-d * ,
sizable

may

amount

com-

10 6%

only

capital in

However

tremendous

a

11

ac-

for

the indus-.
try could probably take on fairly,

may

For the coal industry this

insurance

our

vested

the early 1970's.
seem

since

counting

$500 million in

as

by

panies showed long term debt

period

q»->h
and

vpars
years

much

especially

companie's

1
the annual figsteadily in the

increase

be'"satisfied

to

long term loans from institutional

If projections

of

likely

seems

of

about $300 million.
demand

Financing Needs

..•*-■

-

#

Invest $lJ/2 Billion By 1960

declined steadily. Also, mergers mines. Strip mining production Sents a net margin of 6.2% on ^
and consolidations have reduced has leveled off in recent years and- sales of $565 million. In addition, Thl
the number ot operators
of operators. By 1953..
1953,
mines of 3% of the companies ac-.
mines of 3% of the companies ac-,
counted for 45%
of the output,

charges.*-

Eis.-s's.r.rs sa ss sfcaasrstti
deep

reaching

1 flC A

.

in

where the competi-

intangible advantages ot othei
intangible advantages of other
...

uia0t>r

anf1
and

bigger

of total output.

tive nrice of coal is outwpiPhorl hv

R

hi„wr

took

and

sufficiently

gain

may

in those

to

consumers

reserves

ca™et increasingly less important mines has been declining as new of the publicly owned companies

effort

.

loss of

coal

and the going rate for these leases The rest, about $150 million will
varies from around 10c per ton to be sought in the capital market,
around 25c per ton.
'■

S2"

outlets and large consumers, such technological developments, such
re^ulVTn^either"retardithe
as roof bolting, are employed and
result in eitnei retarding the as utilities and the steel industry,
This

nesses.

the

,

I960 in order to keep pace with
toe necessary capital began in- demand.
vesting in the modern labor savThe cost of new mining varies
ing equipment with the result that considerably.
Generally,
strip
piouuciwity rose steeply. As the mining has been considered
stronger units in the industry be- cheaper than deep mining with
San to make real gains ill cutting some new strip mines having been

indus-

efforts

slowly

and

.,

Those coal producers able to find

results

coal

steeply

with

mounting labor costs

auto-

matic burning
such

faced

53

(2549)'

oi

^

pel mmuie.
inus,
rise in productiv--

in recent years gives
hive
competitive standing and position
as

the dominant

coal
among coal

petitive fuels

of

source

and

its

energy

directly

com-

the United States,

in

tinue. Only the larger units of the all average cost of $6-$7 per ton
industry can afford to finance the ot" annual capacity seems a fair
iarcfp npw minoc nppp«arw if poctc
iarge new mines necessary if costs estimatp of new mining costs.
estimate of new mining costs.
to

are

be

v

v

V

-

Financial Economics of the

.

ranges.
V.:.' The success
ment

<

Coal Industry

.

^Abundance

in

new

tons of

-

of

mine
Eleven

1955.

deep mine of 2 million

annual

capacity

backed

by reserves of 80 million tons now
costs in the neighborhood of from
publicly. $1.5-$20 million. Of this, about $8

improve-

became-

programs

evident

A

kept within-competitive

these

kncic of
basis at

coal

nous

clearly

easily accessible

industry.

This

od^ Tib 1

and* f

entrepreneur and impeded the
m n
trepreneur
concentration of production in few
and

stronger

hands

-so

coal

industry

today

is

of

small

many

mines

that

^and 2^% ^1945'?% ^ ^
%
•

Future

the

small

•

New_Investment

Meet
,

composed
and

to.industrv

compares

abun-

future

,

capacity and production has

the past caused intense competition and narrow or non-exist-

coal

lands

and

~^
ment is

t.-.
oii
In all prob-

.

mine

Hon

annually.

As

the

burden

expansion will fall primarily

p0Ses.

Best guesses

seem

more

2c

in

per

the

gr0Und
in

ton

for

certain

upon

pur-

instances, although it is

common

practice

to

a

lease

equally

this

divided

will

be

between

■

ni

companies.
sive

The

resulting

exces-

in

profit margins.

Complicating

this picture is the fact that it often

the

pays

at

a

loss

mine

operate
rather than abandon his

investment
mine

tive

having his | closed
j-x-

,

these conditions coal

have
until

From
a

by

fill with water and collaose.

Under

rities

to

owner

whole

highly specularecently.

operated at

industry

a

loss

likely
enn

as

which

to

million
„

this

increase

mnimn

3uU

secu-

been

1930-1939 the

duced 470 million tons and

.

,

tons
..

this
,

A1

to

off at 10 ^ of sales, or 50/o of net

^ whiSeveT1^loweTInstead
Gf

taking percentage depletion, a
company may elect to take

about

coal

earn-

cost

ings retained after dividends and

depletion,
"*•

which

Continued

/

is

Investment Bankers Since 1912

,

generally believed that productive
capacity will have to be increased

Municipal

•

Public Utility

possibly to

much

as

as

1

■tun

INCORPORATED

^

Member

Established 1893

i

New York Stock Exchange

Underwriters and Distributors
of

Industrial Securities

Underwriter: Concord Fund

bil-

A. G. Becker & Co.
..

•

1° about 700 million tons by 1960
and

American Stock

d/Co.
v

Midwest Stock Exchange
Exchange (Associate)

Corporate and Municipal Issues
44 Wall Street

Commercial Paper

122 S. LaSaHe St.

30 Federal St.

NEW YORK CITY

Brokers of Listed and Unlisted Securities

CHICAGO

BOSTON

Aurora, 111.

York

Midwest

120 So.

Stock
Stock

Exchange
Exchange

American
San

Francisco

LaSalle St.

60

Chicago 3
Telephone:

CG

Telephone:

1089

San

Francisco




and

Other

York

South Bend, Ind.

Nantucket, Mass.

Spokane, Wash.

Kansas

Omaha, Neb.

Tulsa, Okla.

Lexington, Ky.

Peoria, 111.

Waterloo, la.

Madison, Wis.

Philadelphia, Pa.

Wausau, W is.

City, Mo.

4

WHilehall 3-2800

NY

Moline, 111.

Exchange

Broadway

Teletype:

Rockford, 111.

Decatur, 111.

Exchange

Stock

New

FRanklin 2-6100

Teletype:

Stock

Portland, Me.

Minneapolis, Minn.

Flint, Mich.

New

Milwaukee, Wis.

Concord, N. II.

Members

1-3433

Cities

•k

is

based

on page

I

Incorporated

about

year. • It

,

.

ACJ/L72 and Co
ompanu

seems

amortizn

P,e/C®n1tfa|e dePletlon 1P.sno/charge^

to indi-

lion will be derived from internal
and

.

,.The foregoujg is not meant to
ln}P*y toat the coal industry is
without problems in facing its
•need *°r new capital. The most
commonly voiced concern is m
reference to depletion charges,

cate that about half the projected

sources

self

sense

a

merely make more efficient its
P^ent productive capacity. De-

mand f°r coal has snapped b^ck
sharply since the low reached in
1954- Last year the industry pro-

coal

as

in

hiflllor

Lf

of

the larger units in the industry,
not all this flow of cash can be
considered available for such

QC

as higher depieciation charges

the bituminous coal industry will
be called upon to do more than

ent

of

buy

little

isolated

,

immediate

the

cost

probably
industry-wide

an

lnumi. mfo
lower rate.

devel°Pment Big companies can annual requirement of $300 milas

Demand

..

in

But

to

the

be:*Qfi;^

should

on

o

a

ability, the bituminous coal industry is generating and retaining
funds at a rate of $200-$225 mil-

owned bituminous coal companies,-.million^ is needed for equipment,
coal
reserves
has been the pri- many of them among the stronger such as co#tiiauous mining mamarv
conditioning factor in the un^s of the industry, last year chines which cost , about $100,000
financial history of the bitumi-' netted 6.2% on sales of $565 mil-apiece.
The remainder represents
of

figures

projected

54

54

(2550)

Continued

from

page

cash

53

payout rose .from $8 million "1970-75.

$13

to

Securities Committee

the

ratio

fell

to

ably make every effort to

ahead

securities

in

enjoy

may

investment

that

order

their

favorable

a

environment.

age depletion allowance is in¬
adequate to finance the acquisi¬
tion of new reserves either be¬
the

seems imperative that a
larger share of income be retained

tions, and the industry would be
healthier financially if
it had a

to
finance expansion and main¬
tain satisfactory capital structures.

faster write-off schedule.

Overall, it

past, depreciation and
depletion have not been as impor¬
tant in the coal industry as
in
some others
due to the fact that

upori the book value. Because the
book value is generally far below
replacement value, cost depletion
would
be
grossly inadequate to
finance the acquisition of new re¬
serves. In most cases the percent¬

•

ly

In

the

approached the 52%
tax payout common in other in¬
dustries. Our 11 companies paid
Federal corporate taxes at a rate
of 28% in 1954 and 37% in 1955,
coal

has

not

severely
limits
the percentage
depletion
allowance or, in some cases, be- *
cause the 10% rate is inadequate.
If again we refer to our 11 com¬ basing the computation
of these
panies, we find net property car¬ rates on the taxable income after
ried at $4.09 per ton of 1955 pro¬ deducting depletion.
These rates
duction and combined deprecia¬ reflect past losses to a large ex¬
tion and depletion charges total¬ tent and may be expected to in¬
ing 32c per ton. This means that crease as these losses are charged
net property last year was charged against future income.
This in¬
off at a rate of 7.8% annually. If clining
tax
rate
will
militate
this
same
32c
were
charged against net earnings to some ex¬
against new mines costing $7 per tent and will, of course, make
ton, the annual rate would fall to depletion and depreciation more
4.6%. Actually, of course, our 32c significant as sources of funds.
figure includes depreciation
of
Dividend Outlook
equipment which would rise with
the cost of such equipment so that
Lastly, we should consider the
it scarcely seems likely that the "dividend problem." The dividend
rate would fall to as low aS 5%. payout of the coal industry has
At this rate, it would take 20 years traditionally been high.
In the
to write off a mine.
decade
1930-1939
the
industry
cause

Write-Off

is

Required

considered

while

undesirably

$296

nlow

considering the inflationary
trend of the times even though

this is about the average projected

the

new

mides

old industries,
to

some

years

million

$219

represented

million

73%
in

earned

of

that

Like other

the

result

of

period.

Our 11 companies in 1954

paid out

are

the

as

66.5%

dividends

of

but

their

in

earnings

1955

while

will

be

and. in¬
sufficient

maintain and improve retained
earnings despite higher taxes and
probable higher dividends.
The eagerness with which in¬

tons.

should
the

will

also

be

be

industry

problems.
investors
ties

very many

around,

pointed

still

Not

sharing in the

new

price

is

only

can

reasonably

be

esti¬

approximately 750 mil¬

tions

officer

An

of

of

one

siderable

new

of

source

liquid

hydrocarbons which

in

open

frontiers for

up

many

new

chemical processing.
The reader of this
come

turn

report must

to the

same

caution

before

commit¬

and

near

long term future of the-

ex¬

the. coal-oil

and

Coal

;

Industry

lion

Conclusion

bituminous

the

speed
atomic energy can be
all have a bearing on

approximately
60
million
1956, wPl exceed 125 mil¬

tons

It

coal

in

*

1980

can

With Mitchum, Jones
(Special to The Financial Chronicle)

LOS

-

ANGELES, Calif.

H. Grayson has become connected':
with Mitchum, Jones <&

Temple-,

ton,

650

South

members

of

the

Spring
New

Street,'

York

Two With Shelley, Roberts
d

(Special to The Financial Chronicle)

with

Shelley, Roberts & Co., S486

Santa

Monica

Boulevard.

If

The

transitional phase.

production
to

is

to

1954

insatiable.

which

million

in

1955

tons

of

estimated

are

4Q0

energy

shouM

million

to

tons

produelion

will

of

be

.

future,
optimistic
esti¬

total

atom

more

electric

fueled

by

which

LOS

ANGELES, Calif.—Eleanor <
Dreher, Hratch A. Kludjian

G.
and

Elmo

K.

Moen

have

higher

a

however,

include co«l of
and

increasing

Building.

reserves

of

lower

inevitable

as

formerly with

rqnk

of

coal

LOS

bv

of

ANGELES, Calif.—Robert

Witton has been added to the staff
cf

continue, spurred
d°velopment

Staff

to

(Special to The Financial Chronicle)

gasifica¬

wages,

on

producers and
w'll

limit

was.

Walstcn

Spring
with

&

Co., Inc., 550 South

Street.

He

formerly

was

Daniel Reeves &

Co.

tho

continue

to

increasing

Joins Jensen Stromer

the

part of

consumers

be

made

cost

of

(Special to The Financial Chronicle)

of

MARYSVILLE, Calif.

to

coal

transportation by the railroads, it

E.
&

Converse

is

now

—

with

Eugene
Jensen

U. S. Government

stocks

Investment Division
Utility — Industrial — Railroad

135 South La Salle

Telephone Financial

6-4600

Street, Chicago 3

American National Bank
and Trust
LA SALLE

York




—

Company of Chicago

WASHINGTON

•

FRANKLIN

2-9200

Teletype CG 273-2860
MEMBER

New

AT

Philadelphia —Minneapolis

FEDERAL

DEPOSIT

*

Stromer, 426 East Fifth Street.*

State and Municipal Bonds

Exchange [Assoc.)

>

Shearson, Hammill & Co. and

effici°nt couioment and ris¬

Although efforts
^oa1

He

\y*l*fr»^ Addh

lignite.

There is little ouestion th^t the
trend to greater mechanization or

both

asso¬

Shearson, Hammill & Co.

ing production demand.
;

Theo¬

ciated with Sutro & Co., Van Nuys

importance

hydrogenation
developed.

more

—

dore B. Holmes has become

substantial

and

"higher

LOS ANGELES, Calif.
•

at

considera¬

remembered,

will

(Special to The Financial Chronicle)

ulti¬

(Incorporated)

American Stock

beefr

With Sutro & Co.

current

could

recovered

reserves

seems

mines

the

contemplate that not
10-20%

are

energy
will
for
electric

in

these

coal

ap¬

<;

be

ranks,

tion

need, well
1980.

which

into

However,
of

Electric

the

most

;

consumed

bv

the

being subbitumineus

ap¬

bituminous

be

1

at

are

t^at tb^se

from

nation's

the

in

coal

tion; the country has enough coal
to
last
two
thousand
years;
It

large

demand

The

electrical
be

in

reserves

rvices

bituminous

due

increasing

for

the

all

of

coal

that

Sterling

(Special to The Financial Chronicle)

five hundred years.

some

mately

1947.

resurgence

the

production

level for

suggests, however,
industry
was
going

a

Three With

of
are

be recovered

tain

now

the

all

States

reserves are con¬

only

or

reserves

United

EXCHANGE

Philadelphia-Baltimore Stock Exchange

and

Los Angeles Stock Exchanges.

.

a
major segment
market, and oil and natural
made serious inroads into the

even

Municipal Bonds

/

~

Leon

—

by present min¬ added to the staff of
Sterling Se¬
ing methods.
The present eco¬ curities
Co., 714 South Spring St.
nomically recoverable reserves
alone would be sufficient to sus¬

eliminated

market.

as

ground

consistent deterioration of
bituminous coal's position as dieselizatiorl of the railroads virtu¬

retail

the

sidered

nessed

.Although atomic
provide some fuel

Members Midwest Stock
Exchange

a'

than

more

—

that

apparent

in

gigantic whether

The 1944-54 decade wit¬

and

is

coal

industry,

long considered a depressed in¬
dustry, is undergoing a vigorous

energy

*.*.

is

one.

double the present market.

The

than

bright

re¬

by Western Europe.
In soite of
these uncertainties, it can be rea¬

total

VI

over

which

Bituminous

boost

postwar

tons in

mates

Public

con--

elusion of the committee—that the-

BEVERLY HILLS, C a 1 i f. —
sonably .estimated that Hie U. "S.. Bruce G. Hines and
Ewdard D.
export market for coal, which "'ill
Wright have become connected

'

power

bonds

will *

•

■

the- amount of coal to be inrnorte^

of the difficul¬

ting their funds to it.

coal,

H. M. Byllesby and Company

the

presently being laid lor

are

whole

a

for coal has

tremendous

a

dynamic

generated,

are

coal boom.and'

by many producers in
this industry should exercise con¬

140

STOCK

can

at

relationshin

with

many

companies

unaware

pears

MIDWEST

It

-

change problems,

it

that

out

faces

all

and

faced

utilities,

MEMBERS

term.

inevitably

The export market

Their eagerness

unlikely that

bargains

coal

1234

level

East,

makes it

The

CG

for

.

the

of

rapidly coal
chemistry will develop in the near

last month has stated that founda¬

demand

present

from

difference

a

how

to

industry's

expansion

low that further losses

mated

production
of
392.000,000
tons
probably
represented
the
low
point of the downward trend ini¬

RAndolph 6-8800

its

exists
as

leading coal companies within the

fully justified in terms of covery in Western
Europe
and
the outlook, if not in terms of the
'with
its
growing
shortage
of
past history of these companies.
power to create energy.
Political
However, this very enthusiasm events in the Middle

through

CHICAGO 3

growth,

any

There

opinion

will

trade cannot be expected to show

bituminous coal,

that

STREET

coal

steel

the

seems

petite

SALLE

increasing

,

part

LA

the

current prospective
program.; While

given

electric utilities.

SOUTH

of

source

expect-any
possibility of a future reduction of'
this cost, which almost equals the."
average mine cost per ton.

es¬

com¬

power.

bituminous

been

tiated in

135

for

from

our

The total domestic
consumption
of coal in 1955 was 423 million

.

evidence

CO.

The second

stem

investing public is not unaware
improved circumstances of

of the

industrial

HICKEY

petition from atomic
demand

in

substantial

any

appears unrealistic to

lion tons in 1980.

gas

DISTRIBUTORS

for

have snapped up rfecent
offerings of securities by members
of this industry indicated that the

ally

DEALERS

timates

be minor.

of the

UNDERWRITERS

adjustments-made

no

so

vestors

recovery.
now.

profits in coal

extent

losses
totaling
during the war
(1940-1946)
dividends
of
and

costs

to

sustaining

million

$160

life of

creased demand

,

than like¬ : coal from railroads and for retail

more

lowered

paid out $134 million in dividends

Faster
This

profit

net

that

seems

present expectations if present
trends continue,, there have been

Never¬

theless, it

property acquisi¬

low cost of past

electric power
well in excess of

our

main¬

tain and. increase dividends in the
years

Since

growth may. be

The coal industry will prob¬

49%.

Report of IBA Special Industrial

million

INSURANCE

CORPORATION

Volume

184

Number

5594

The Commercial and Financial Chronicle

...

Continued from page 29

(2551)

provisions

have

to constitute

the

public

been

bilked.

But

the

public

investors

in

the

public must also learn not to buy
the proverbial "gold brick."
The

tributions

effected

tragedy from the standpoint of the

securities

exchanges

States

as

subject

United

result of primary

a

dis¬

■public investor is that the widow.
the

wage

the

earner,

person' of

*

small
'

income

is

the

often

victim

of the "boilerroom" salesman. Tne

Canadian

matter

is

it

dealers.

possible, as
jurisdiction, to reach

of

Canadian

not

issuer

similar

through

and

brokers

Although

or

;

■

(

fraudulent

us

in

using.

*

every

transactions

common

securities

sense

in

their

transactions.

the problem

of sales of
securities based on

unregistered

claimed exemptions.

dealer,
closely

and7 dealer

Problem of "Claimed Exemptions"

Third,
i

welcome

help from the public in reporting

*to
i

" will

A substantial

in

pected

this

country

of American

sold through

order

Canadian

securities
sources

under

,

in

notice of

a

proposed

a

is

designed to preclude its avail¬

ability in such
Seventh,
motional
the

cases.

out

of

business

or

issues

figures lurk many an issues
brought to market by irresponsi¬

pros¬

-

-

,

the

problem

stocks.

ask.

ble

of

pro¬

addition

In

to

After

the

all,

you

securities

business.

"It

business," you may
might be true if it
the

think!

interest

common

'

great
in

Otherwise you

with

success

the

last

three

would

erroom"

the

Commission

has

been

protect United
States, cerned with the sale of
public investors more effectively. surance

in¬

securities

in

and registered
have given uie

is¬

company

both

con¬

new

pays

tribute to the

porate
the

energy

the

it

mangement and

but

undetermined

number

of

se-

exempt

investment

brought

to

job

*

will

of these

un¬

of

form

of

pursuit and

wrongdoers

and

prevention of loss to the
Most of the many mil¬

unwary.

lions

skill

business

the

the

of

have

lost

which

dollars
will

be

not

investors
recoverercL

even
though we may be able tc*
punish the wrongdoers, to put ou£

has

of

providing
sues,
whicn
ap¬ capital for industry.
Equally im¬
curities have been sold in viola¬ cials, but-the virtual nullification
pearance
of involving abuses Or pressive figures reflect stock ex¬
tion of the registration a rid anti-" by a Canadian court decision of.
probable violations, necessitating change
trading volume
and, if
fraud provisions of the Securities the 1952 securities fraud
amend-..
data were, available, there would
Act pursuant to claimed exemp- ment of the Canadian Extradition thorough investigation. •
be
big
figures
for
over-theThe enforcement
program
has
tions
which, in fact, were not" Treaty
has
seriously,
perhaps
The tremendous
to be related to the complex and counter trading.
available.
We believe that these
fatally, impaired our ability to
market activity speaks eloquently'
sales have been made in the main
ever-changing pattern of the se¬
protect the American people from
curities markets.
The facts con¬ of the vast public acceptance of
under claims of exemption pu4*- securities
frauds
originating inour capital formation and market¬
cerning
the
business,
property,
V suant to the so-called "private of- Canada.
and of
the role
arid financing of a corporate issuer ing processes
.• fering"
exemption and the intraFifth, the problem of the "front must be ascertained and related which- the securities industry has
: state exemption. In most of these
money" racket. Under the Com¬ to the
representations made to in¬ played. They might lull you into
d cases
the
Commission
has
no
mission's exemptive regulation for
vestors. ; Investors must be iden¬ thinking that all is well, that in¬
means to discover facts showing
new
issues not oyer $300;000 in
tified and interviewed, Books and dustry and the public have learned
the unavailability of a particular.
amount, and sometimes under reg¬ records of
the lesson of the 1920's, that the
brokers, dealers, issuers
■'/, exemption until it receives.
istration, "rings" have developed and others must be examined and securities industry and the Com¬
months
after
sales
have
been
through which
mission may now relax.
groups
of
pro¬
analyzed.
Frequently, securities
made, reports or complaints from
moters, dealers, attorneys, and en¬ must be traced
Neither the securities industry
through intricate
unwary public investors who havegineers collaborate in the creation- channels
to
ascertain
whether nor the Commission can afford to
been "taken" for substantial sums.
of a series of companies primarily
they have been offered by an is¬ relax. For in those big new issues
Further complicating the Com-'
employed to "manufacture" secu¬ suer or underwriter in violation and
big trading figures are con¬
mission's
problems in 'this area rities for
public sale in the guise of the
registration requirements cealed many human tragedies, for
; has been the fact that an increas¬ cf
legitimate promotions. - Often of the acts. The information thus which all of
us, the securities in¬
ingly large number of securities
these facts have not been devel¬
obtained must then be developed dustry, the Commission and the
claimed to have been issued pur¬
oped :or
discovered
until
after in a form which will
investors
themselves,
share
re¬
permit its
suant to
these
exemptions have
public investors have bought se¬ introduction in evidence in
In those
big new
been transferred to United States
legal sponsibility.
-

the

takes

not

cor¬

the

"in¬

corporate

and

Many

punishment

have

of

which

doubtedly be brought to justice.
But the unfortunate, the tragic,
aspect of law enforcement is thai

problems created by the sale sold $33 billion of registered se-?
promotional uranium
stocks, curities in that period. The figure

of

in

"boil¬
brokers and

operators,

promoters

v

years.-

never

are

transactions

by unscrupulous salesmen,

Certainly the securities industry
had

par¬

capital

those big
concealed

In

peoples' savings have been stolen

share/- siders."

we>

from

vital

the

figures

trading

for

the interest of the investor.

investor

process.

countless

is

underwriters

barred

be

in

formation

That

not

were

should

ticipation

engaged

are

and

promoters

who

the Commission's job to police the

has

to

We receive fine cooperation from
Provincial law enforcement offi¬

re¬

vision of the "no sale" rule which

sus¬

participating in the
illegal marketing of Canadian se¬
or

faced

as

released

of

curities

forced
ecuted.

presenting in

provisions

problems

the reg¬

of

a

we
are
reviewing mora
the: activities of broker-

firms

not

the "private offering" and "intra¬
state"
exemptions.
We recently

-

'

Commission

incor¬

a

a

broker-

a

of

deemed

to

istration

"

cr

a

securities in violation

Canadian

on

state

been

"sale" of

security
Relates Securities Industry to SEC
registration..; This "no
sale" rule, as it is called, has been
"Where does the securities in¬
used < by
numerous
issuers, do¬ dustry fit into the Commission's
mestic, and foreign, to distribute enforcement program?", you may

SEC's Impact on Capital M iikels
*

the

of

poration,

55

business

securities

the

of

who,

by
on

the

abide

by

high

vast

-

minimize

those

practice, cast dis¬
majority who

sharp

credit

standards and io
by warning the

losses

-

public.
Appeals
7

Just

Re-Examination

for

this is

as

time when thfv

a

Commission clearly must increase
its

is

enforcement

activities,

so

thL>

time for the securities indus¬

a

try, and the industry's variouy
segments—such as the stock ex¬

.

changes, their member firms, th^
National Association of

Securities

,

Dealers
other

which

curities

t

Lichtenstein,
and
other foreign
financial institutions, under for¬

eign

which

laws

Commission
transactions
ties

from

in

preclude
tracing
the

which

the
the

We

have

increased

efforts

our

discoveries

factual

make

to

sales made without registration
the
to

earliest

opportunitv

at

order

availability

the

determine

in

of

and thus to

take

relate

to

even

may

[

the

of

sales from Canada.

illegal

The Commis¬

sion has been concerned about the

1

by issuers and broker-dealers lo¬
cated in Canada.
These transac¬
have

to

appeared

issue

one

with

another

though a particular issue
have been part of a scneme

recently
revised
exemptive
regulation, the Commission now
requires disclosure of the names
of all such
individuals, and "our
field olfice investigative work has
been

stepped up.
"No

Sixth,

f. illegal sale of issues in the securi¬
ties markets of the United States

tions

it is difficult

that

or

Sales

problem

so

our

reach

The

Doctrine

Sale"

problem

the

of

Commission

Let

issues.

new

securities and

reclassification

of

another

additional
in

of

acquisition of assets
under

person,

stock

conformity

which

been

issued

has

with

the

statutory

of

Each

these

investigation
and, in many instances, has re¬
quired
a
formal
administrative
hearing.
volved

actions

These

the

the

and

JVfembers A'eu; Jork Stock

Continued

prob¬

it

affects)

as

on

page

have

' ' SINCE 1890

in¬

66 Years

testimony.

sold, would
have defrauded the public have
thus been kepi off the market.
Careful

a

must

period
precede

action

work

by

tors;

the

of

the
In

in

others,

a

of

Banking

work

Underwriters &

many

civil
few

or
,

has

Water & Sewer Revenue Bonds

public inves¬

Public Utilities

have

Industrial & Corporate Securities

been discovered in time to prevent

serious

in

injury to the public;

others,

violators

&

Toll Road Facilities

Bridge Revenue Bonds

cases

violations

have

Distributors

Municipal Obligations

Corhmis-

Commission

restitution to

to

of Investment

if

painstaking

in the courts.

the
led

and

over

criminal
sion

which,

of

and

been

CHICAGO 3
105 W.

Cruttenden, Podesta

enforcement

questions

the

Stifel, Nicolaus <Sl Co., Inc.

establishment of facts

obtaining

Securities,

/

has

been preceded by an

months

consolidation,

of

few

a

highlight

number

stop-order
proceedings
and
suspension orders with respect to

evasion

By

will

instituted

substantially increased

through the "no sale" doctrine.
a long-standing interpretation,
certa:n types of corporate merger,

registration

lem

ask

me

which

of,

usually

the

has

ADAMS

ST.

STREET

314 No.

LOUIS

2

BROADWAY

Co.

Exchange and Other Principal Exchanges

209 South LaSalle Street

•

Chicago 4, Illinois

Partners

Listed

Underwriters—Brokers

&

Unlisted Securities

Straus, Blosser & McDowell

Walter W. Cruttenden

Robert A. Podesta

Donald B. Stephens

Glenn R. Miller

MEMBERS

Walter W.

Cruttenden, Jr.

NEW

YORK

STOCK

DETROIT STOCK EXCHANGE

Donald R. Bonniwell (Ltd.)

39

firm provides

a

personalized investment service for individuals, banks,

NEW

CITY

omaha




denver

milwaukee

lincoln

grand rapids

st. louis

madison

PRIVATE WIRE

indianapolis

cedar rapids

Retail

EXCHANGE

(ASSOCIATE)

STREET

3, ILLINOIS

ANdover

3-5700

TELETYPE
CG

NEW york

EXCHANGE

TELEPHONE

YORK

KANSAS

SALLE

SOUTH LA

DETROIT

institutions and dealers

MIDWEST STOCK

AM ERICAN STOCK

CHICAGO
Our

•

EXCHANGE

•

tot

in

proceedings.

requirements

of

Fourth,

no

of the character mentioned. Under

legal action.

Canadian

or

a

fully timed

unavailability of these-exemptions
<

little

have

These various trans¬

actions frequently have been care¬

securi¬

have

publicly been sold or
determining
the v availability
or
unavailability of the exemption.

<

actual value.

anti

dealers

self-appraisal and re¬
examination of their responsibili¬
ties.
V; / ;
.■'■■■1 '■/«': -

.

through Canadian, Swiss,

members

its

•

over-the-counter

engage

.

citizens

and

MT.

RAPIDS

CLEMENS

ROCK

650

SYSTEM

MILWAUKEE

GRAND

COAST TO

ISLAND

COAST

Trading

i><!

56

(2552)

The Commercial and Financial
Chronicle

Thursday, December 13,1956

.

.

.

\

Continued

from

page

promoters

55

gitimate

the

Commission

the

and

whole

When

this

association

in

the

that

take

securities business.

or

mission

When brokers and dealers

that

motion

we

the

promptly

can

complicated

by which the

put out of business
When

a

firm

distribution

of

of

so

that

we

learn

may

in

action to determine
illegal
activity
is
in

be

participates in the

persons

and

unreliable

infor¬

business

the

over

ask

if

hurt

we

participations
transactions
which
connected with the

"inside"

this

an

advantage
investor, and I

public
will

not

securities

the

inevitably

business

as

a

whole.
We of the Commission
deeply
appreciate the cooperation which
industry organizations, including
this

organization, give us in deal¬
underwriting
offerings of
ing with these problems. We must
unknown enterprises, do
necessarily hope for the further
the persons distributing the secu¬
enhancement
and
strengthening
rities always make sure that the
of that sense of common responIn

large

a

the

block

of

new

careful in¬

a

facts

made

to

or

sibility which the securities busi¬
ness must'share with us.
So

much

of

our

that

for

enforcement

our

There are other aspects
administrative
program

program.

have

been
continuing over
period of time toward
which your Association has made

long

a

McDougal and Condon

a

vital

contribution.

Municipal Bonds

1954,

mission

try,
to

S. La Salle St.

the

present

a

of

rities

laws

Of

•

securities

not

only

securities

underwriters.

We have

fact

of

the

of

a

readers

to

be

has
in

provide

indus¬

document which

would

be

more

the

sellers

reasonable

securities

at

of

inevitably
thermore

be

in

want

we

which

movement

the

direction

uninformative

the
that

and

the

be

prepared

offering
be

filed

the

Also important were
which permitted

the

Commission

providing
One

for

to

adopt

liver

40

to

which

rules

reduced

days

prospectuses

unless

the

the

dealers

dealer

is

statutes

WISCONSIN

the
Teletype

BRoadway 6-6075

MI-581

CHICAGO

BAY

•

as

still

Spalding (Limited)

Harry A. Graver

^Alvin H. Hayward (Limited)

,

worked

vestor

CO.

New York Stock Exchange and,
Other Principal

engaged

Exchanges

CHICAGO

had

S. LA

RANDOLPH

YORK

NEW

SALLE ST.

ONE

WALL

DIGBY

6-8161

STREET

4-0700

simplifying
under

of

legality of

dealers

and

connection
of

with

First Securities Company

issues.

new

of

This result has been achieved and
has

MADISON

R. Edward Gam

Payne

Members

well

any

without

the

way

Chicago

dimin¬

basic

in¬

UNDERWRITING

DISTRIBUTION

•

protection.

WAUSAU

•

J.

Philip W. Smith, Jr.

JOHN J. O'BRIEN

de¬

have

the

to

in

distribution

ishing in

ST. PAUL

•

GREEN

issues which

new

and we have always heartily

issues

activities

activities

underwriters

Telephone

hope that the summary

removing doubts
existed prior to the

had

certain

FUND, INC.

our

and

amendments
Manager

It is

Albert

O'Brien

One

amendment

of the

UNLISTED

Securi¬

DEPARTMENT

TRADING

ties

Act, which was urged most
strongly by the securities indus¬
try,

by

authorizes

rule

to

for
in

it's

ments.

of

use

(Rule

On

Nov.

the

INCORPORATED

by

SECURITIES

of

use

a

certain

1956,

SALLE

STREET,

ANdover

Direct

Wire

to

Scherck,

CHICAGO 3,

ILL.

3-1520

Illinois

Richter

Company,

St.

Louis,

Mo.

the
rule

new

provides

summary

issuers

LA

Champaign,

a

which

SOUTH

Prospectus

23,

adopted

434A)

1399

Member Midwest Stock Exchange

a

134

Summary
Rulings

Commission

;WU &
INVESTMENT

the

.

This problem has received
long
and careful
study by the Com¬
mission since the
1954
amend¬

coverage

Wisconsin

permit

Trial

CG

TELETYPE

Commission

prospectus.

summary
New

the

for

prospectus

under

certain

conditions.
225

EAST

MASON

ST.,

MILWAUKEE

2

In

members:

Exchange

Other Principal Exchanges

•

adopting this

slowly

prospectus

instrument

CARL

M.

LOEB,

NEW

YORK

RHOADES

•

•

•

Appleton

•

Eau Claire
Madison
Wausau




•

Beaver Dam
Green Bay

♦

West

Bend

Chippewa Falls

•

Janesville

•

New London

•

CO.

&

•

Racine
•

•
•

1

Wisconsin Rapids

may

be

Brokers and Dealers

an

of

great good in pro¬
information
to
investors

viding

it

*

oV,

o_

LaCrosse
Waukesha

have

we

intentionally.

during the 20-day statutory wait¬
ing period.
On the other hand,

CORRESPONDENT

OFFICES THROUGHOUT WISCONSIN

rule,

proceeded
A summary

I

New York Stock

Qmcz
1928

become

may

which
the

will

whole

securities

discredit

process

under

instrument

an

bring

our

is not handled with

upon

of

marketing
system if it

care.

Its

^PQP'

sense

of

responsibility of the in¬
vestment banking profession.
The

Commission

has

William A. Fuller & Co.
Members

use¬

fulness, effectiveness and desir¬
ability largely depend upon the

always

209

Tel.

S. LA

Midwest

SALLE

DEarborn

ST.

2-5600

find

prospectus will be used to secure
that broad dissemination of in¬

you

J. O'Brien III

from

new

amendments

day-to-day

your

the

which
and

issuers.
we

we

formation about

Evans

231

These

WISCONSIN

Co., Distributor

of

if

cation.

Com¬

S.

in the distribution.

Wholly-owned subsidiary

of

contrary,

the

David

period

must

for

the desirable effect of

Edgar, Ricker &

hand,

informative

more

amendment

year

during

Member Midwest Stock Exchange

classes

other

amendments

the

one

2,

other

will consider re¬
vising the rule to limit its appli¬

cor¬

types of securities advertising.

MILWAUKEE

the

to

the

were
John

the

broaden the scope of the

may

Dn

securities,

with

serves

for which it is intended,

rule

feel

the

by

prospectus rule
for trial. If we

we

prospectus

summary

any

We

previous

purpose

ad¬

some

1920's,

summary

find it works well and

a

to

advertise¬

piiblic sale

of

The

has been adopted

short,

which

a

statutory prohibition
sales until after the ef¬

against

EAST MICHIGAN STREET

ties

frequently

brochures

for

issues

the

of

and

of

seem

registration of

listing
trading on a national securi¬
exchange. \ \
v; ■

and

the

fective date.

207

of

issue for public sale or for

Fur¬

part

one-page

and

must

no

might

(S-l) or the form
grade debt secu¬

(S-9) and which at the time

filing are required to file re¬
ports with the Commission be¬

over¬

condensation.

been

of

a

summari¬

accompany

and

just

institutional

rities

simplification and omission which
zation

has

succeeded.

particular significance

to the effective date of a
registration
statement
but
re¬

The Milwaukee Company

istration form
for

cause

dangers

which

authorizes the use of a
summary prospectus by corpora¬
tions which file on a general reg¬

Though agreeing with your ob¬
jectives, the Commission has also
the

so

financial

adopted

cost.

recognized

and

v.;

rule

The

likely to be read

of

re¬

been

mission.

mailed,

prior

Corporate and Municipal Securities

it

understood by the public and
which could be widely distributed

by

business

have

annual

or

Commission,

previously dis¬
closed to the public and its filings
previously examined by the Com¬

interest

be

its

the

secu¬

the amendments which made pos¬
sible
the
offering
of securities

tained

that

affairs

summarized

could

statement

with

ports

and

poration

needed

Federal

that

public

sum¬

Commission believes

The

tration

printed in newspapers and other¬
wise
distributed
to
the
public
during the waiting period, which

Association,
long

urged

the

with
sum¬

initially, at least, a sum¬
prospectus should be used
only by corporations which have
previously filed
either a regis¬

understanding

shorter

a

for

us

the

mary

might be desired. Your

as

Association

would

of

group

which

that

also
their

or, "red herring" pro¬
spectus perhaps did not reach as
wide

by

consistency

and
facts

prospectus purports to

mary

been cog¬
the pre¬

that

basic

marize.

the

but

and

nizant

to the Con¬

program

of the

of

the

reviewed

and

conformity

would redound

corporations

should

your

certain

amendments

Chicago 4, 111.

Teletype CG 276

the early part
the efforts of the Com¬

and

benefit

vertised

1953 and

including

gress

208

desirable and

the

ments

Long Needed Amendments
During

to

misleading

Incorporated

of

mission

liminary

time

concealed

securities

false

a

cn

of

give

given to investment let¬
ters, tipster sheets or investment
counsellors by persons participat¬
ing in distributions so as to make
it easy to unload blocks of secu¬
rities on the unsuspecting public?

punished?

or

unregistered stock, is
vestigation

can

informed

exemptions?
from time to

public
knowl¬

was

issuing

Finally,

that wider

into

purchasers

reliance

mation

processes

lawbreaker

convinced

understanding and. public

edge concerning corporations
bringing new issues to market

pockets?

mergers entered

creating

been

and

purposes

through nominees and de¬
vious
transactions, channel that
stock to the public in purported

prompt

Is

in

set

is

process?

lgarn
of a securities violation, do they
always let the Commission know,
so

exemption

a

whether

any

an

price

organi¬
zation in the securities industry
but affect all who engage in the
or

phony

le¬

flood
of stock in the hands of "insiders"

sudden, big rise or fall
of a security is ob¬
served, which might suggest il¬
legal manipulation, is the Com¬

obviously the problems are
specifically
identified
with

cause

not

Are

for the purpose of

available?

"the
be¬

corporate

to

on

and

proper

who,

determine

whole

industry.
I say
securities
industry"

for

riot to line their own

SEC's Impact on Capital Naikets
securities

be depended

can

the funds

use

Stock

Exchange

CHICAGO

Teletype CG

4, ILL.
146-147

Volume

Number 5584

184

.

The Commercial and Financial Chronicle

.

.

cision

endorsed, and which is consistent
with the
original policy of the
Act to
get information
to pro¬
spective
investors
during
the

in

membered

others

Abuse of the rule must inevitably

laws

the suspension
to the Commis¬

This

the

reserved

power

sion

of

use

in

amendment

the

statute.

If

for

Commission

the

the

it

becomes

suspension

"free"

exercise

with

power

Commission

any

rule

in

sion

will

make

rule
of

effect,

its

in

well

that

the

How to Achieve

to

*

to the

grams

proper

affected by your

markets

of

respon¬

American

the

era

of

in

made

an

prosperity,

great

Government

or

uninformed or unwise
cannot, after he has
the

lost,

Congress

public, particularly

blame

not

speculation

vesting public?
The

this

money

in¬

*

is

going

will

Second

down,

guarantee that

a

go

on

than

Dale Welch V.-P. of

"bull

a

First of Iowa

The responsibility of
securities
industry and the

the

—-

DES

corporations and others subject to

Welch

the

MOINES,
has

been

Iowa—Dale
elected

Welch

ex¬

tremely important legislative de¬

shift

self.

There is

blame
no

from

more

of

a

for

or

listing

squarely

trading

and

ration

Women of Chicago will hold their

on

alties

been associated with
many

failure

for

properly

sibility

likewise

brokers

to

and

is

GRAND

now

;

ards of the Acts.

.

Bass

Milton

and

—

plied

we

the

laws

securities

or

disapprove securities is¬

It is the

against the Federal

(Special to The Financial Chronicle)

JACKSON, Mich.—Henry Van-

have

dersalm is

to

now

with H. H. Butter-

field & Co., City Bank Building.

laws

OtlPlYlQS

fl?7<217 f

public investor that

securities

connected

^SaconTJf^ijpp/e

But, on the. other
have no authority to ap¬

prove

now

com¬

are

with.

sues.

in

securities laws

is

Joins H. H. Butterfield

Daniel

Marcuson

RAPIDS, Mich.— Jer¬

Straus, Blosser & McDowell^
McKay Tower.
'

(Special to The Financial Chronicle)

SPRINGFIELD, Mass.
-

seek

New York

Chicago

protect, but the protection af¬
is to put the investor in

forded

informed position to make his

an

own

Rodman & Renshaw

investment

sure

him

free

decisions,

ing his

Members:

markets,

York Stock

Midwest
American Stock

chicago 4

209 so. la salle st.

merits

of

securities.

If

William T. Bacon

Jay N. Whipple

William

John

Ernest P.

Robert

D.

Harold

Ames

Sherburne

H.

William

T.

Hartshorne

Francis-R.

Leslie Wagner

Bacon, Jr.

D.
B.

Kerr
Krell

Harold A. Bray

Schanck, Jr.

Gordon

Bent

the

responsibilities of the Commission,
industry
and
the
public
are

shouldered, the Congressional ob¬
in

expressed

ties laws

wil

confidence

be

the

securi¬

achieved, public

in the

capital markets

medium for investment of

as a

Teletype CG 2296

Exchange (Associate)

Partners

The Federal securities laws do
not, and, I hope never will, give

jectives

Telephone DEarborn 2-0560

Exchange
Exchange

Federal agency

a

v

the

Stock

investment decisions

own

the Commission power to pass on

Chicago Mercantile Exchange

•

New

make his decisions for him.

Stock Exchange (Assoc.)

Chicago Board of Trade

Midwest Stock Exchange,

Members

x

as¬

but not to prevent him from mak¬
and not to have

New York Stock Exchange, American

fair

and

to

people's savings

will

our

continue

to

the

capital so vitally
by our free enterprise in¬
dustrial system will be provided.
and

grow,

sliillinglaw, b0lger

&

co.

needed

The

of

success

prise

free

our

depends

system

MEMBER

enter¬

the

on

.

MUNICIPAL BONDS

functioning of

proper

Net

markets.

investment

Since 1885

is

our

corporate

from

securities

MIDWEST

AVe

have

years,

in

specialized

distribution

of

Illinois

and

underwriting

the

municipal

bonds

and offer you experienced, prompt

for

72

service.

confidence

markets

ESTABLISHED

1885

135 So. La Salle St.

Field Building

CHICAGO
Telephone

—

living for

UNDERWRITERS

and

our

of

INDUSTRIAL

SECURITIES

production,
with
high standard of

120

SOUTH LA

SALLE

STREET

people, it is

Securities

the

of

DISTRIBUTORS

so

essen¬
tial that the policies and programs

capital

RAndolph 6-0820

~

resultant

in

Commission

3

maintained

supply of capital
rate
present estimates

by

industrial

their

'

continued at the high

be

of

/ -V'-'

of

that the essential

anticipated

Speer & Sons Company

be

to

is

.

★

the American public in the capital

can

H. C.

faith

and

EXCHANGE

sales

presently at a rate between $7
$8 billion annually.
the

■

.

and

If

STOCK

Established 1933
!
'
:\-y ....
: :

-7

capital
capital

and

Exchange
the
accordance

supervising

markets

in

CHICAGO

3

Teletype CG 1070

Telephone STate 2-5850

with the standards of the Federal

securities laws successfully go for¬
ward.

The

work

sion will help to

of the

Commis¬

justify and main¬

tain investor confidence in the in¬

tegrity of the capital markets and
thus contribute to the success of
our

NONGARD & COMPANY

free

enterprise system and the

welfare of all

our

people.

Mullaney, Wells & Company

INCORPORATED

With
105 IV. Adams

St., Chicago 3, Illinois

Haseltine, Gilbert

(Special to The Financial Chronicle)

MINNEAPOLIS, Minn.—Thomas
C. Wakely is now
Gilbert
Ninth

Underwriters and Dealers

&

with Haseltine,
Wilson, Inc., 108 South

UNDERWRITERS

—

DISTRIBUTORS

Street.

Corporate Bonds

With Powell Staff

Investment Stocks

(Special to The Financial Chronicle)

FAYETTE,

MUNICIPAL and PUBLIC REVENUE BONDS

Houston is

N.

now

C.—Clarence

120 Anderson Street.

previously

was

&

Co.

E.\

with Powell & Co.,
Mr. Houston

with

Municipal Bonds

Reynolds

-

135

Telephone

Teletype

DEarborn 2-6363

With J. B. Hanauer

CG 385




(Special to The Financial Chronicle)

BEVERLY HILLS,

Calif.—Edith

Oberg is now with J. B. Hanauer
&

Co., 140 South Beverly Drive.

"

with

Two With J. C. Flax

companies to abide by the stand¬

Straus, Blosser

C,+ Manett

ome

with

White, Weld &
Co., Ill Devonshire Street.

dealers, stock ex¬
changes,
dealers'
associations,
holding companies and investment,

that the

13.

(Special to The Financial Chronicle)

BOSTON, Mass.—Clive B. Fazioli

the

Third—The responsibility of the
Commission. Our responsibility is

Dec.

J

^..(Special to The Financial Chronicle)

as¬

on

for

With

Respon¬

-rests

the firm

in Hastings, Neb.

years,

White, Weld Adds
1

that responsibility.

Corpo-' 15th annual Christmas Party in
Building.
Mr. Charter Hall at the
Chicago Bar
represent the firm in Association,
29
South La
Salle
Iowa.
Mr. Welch has Street, at 5:15
p.m. on Thursday,

Equitable
will

Dubuque,

rests

the

corporations,
officers, directors, attorneys,
accountants
and
other
experts,
subject to civil and criminal pen¬

him¬ hand,
hedge

Parly

CHICAGO, 111.—The Investment

President of First of Iowa

of the information about corpora¬
tions registering securities for sale

To Hold Xmas

D.

Vice-

a

securities laws.
Responsibil¬
ity for the accuracy and adequacy

57

Chicago Inv. Women

forever.

been added to the staff of J. ClayAf-'
for bad or foolish in¬ both positive and negative.
ton Flax & Co., 1562 Main Street,
vestment
decisions, unless Gov¬ firmatively, it is our job to see
it that
the
ernment or the securities industry to
responsibility of
have
failed
to
shoulder
their those subject to our jurisdiction is.
tasks. •- The
person
who
loses assumed by them, in other words,

continuing

the

justify

confidence

prices

there

market"

industry

to see that these

ours

securi¬

Federal

the

In

public investor the ultimate
for his investment

must

functioning of our capital

sibility and

responsibility of the

decisions. The

of the Commission and the

markets

unless

thrive

cannot

stock

their

responsibility

how are the statutory
the policies and pro¬

Finally,

the

of

(2553)

sume

investor.

in

objectives,

speaking

ties laws the Congress clearly left

interest

Market

Free

use

enterprise system.

First—The

investors.

public

we

bilities.

profes¬

power

in

and

Freedom

prospectus

summary

work

the

in

all

do

the

banking

when

responsibility is assumed. Let us
look at our respective responsi¬

the

hope

we

so

investment

the

continue

to

investing public.
gives emphasis to

"free''

word

securities

to- the

the

of

decision

markets

frequency, it will be difficult for
the

re¬

in

subject

and

the

necessary

to

securities

always be

"free" in describing the securities

the

to

should

considering the re¬
spective
responsibilities
of
the
Commission, of the securities in¬
dustry
and
corporations
and

waiting period. We hope that the
summary
prospectuses prepared
will be fair, honest and adequate.
lead to

Federal

the

laws which

-

SOUTH LA
CHICAGO

SALLE

3, ILL.

ST.

58

The Commercial and Financial Chronicle

(2554)

Continued

can

from page 27

be sold.

absence

Consequently, in the

of

substantial

relief

on

in the

agement will either have to

Meeting the Nation's Steel Needs
economy,

vested

should

is

capital

by

represented

assets which include all our prop¬

plant

steel

works,

i.e.,

equipment,

and

erty,

material

raw

and

properties,

transportation

ship¬

The

money

physical assets having an original
book value
of $1,726,000,000 are

be

carried

million, net after

$737

at

depreciation, depletion and amor¬
tization, or only about $37 per ton
of ingot capacity as of Dec. 31
last year.
The

maintain

adequate

an

This

investment.

which

as

confronts

is

to

return

entire

the

on

question

a

steel

industry.
this

matter

Given

our

a

current

officials

the

way

90%

other

operation,

day.

with the

structure

price

the

put

and

a

would

subjected to

obtained

increases

other

to

be

by

ad¬
will

or

source

reduce

which

close

business.

should

gen¬

through

of

be

the

possibility

financing.
we

ing

sonable

of

.'v

cash

most

equity
;

that the

.

resulting

with the

costs.

steel

has

war,

conclu¬

industry, since

been

out

average

of

as

to

whole is

a

In

about

advance

large

flects

part

this

have

money

that has

more

been

You

prices.
should

Labor

the

from

expect

steel

re¬

advances
'from

the

invested

to

efficiently.

more

is

It

that

do

job

free

our

Management
Each of

within

the

system.

the

the

of

rest

saddled

cial burden of

whole finan¬

the

a

realistic

More

expan¬

necessary

pricing

is
But

obviously part of the answer.
because

high-cost

facilities
will be only a small part of total
facilities,
these
necessary
price
new,

also

points

a

duty to combat

pressures

industry

are

and

is
expressed, as the study puts
it, and I quote, ".
in the effort,
skill, organization and application
of

we

in

deeply conscious

both

.

and

management

Adoption

of
is

provements

labor.

technological
enhanced

tance.

There

are

two

areas

where

one

clear to

answer

ests

mentioned

the

in

me

should

that there is

solution.
start

become

One

out

involved

and

the
be

have

is

are

meet

talking

amortization

of

and

im¬

by

a

how

much

is

attribu¬

because

income

on

will

funds

for

expansion- to

obvious
bonds

expansion
be

limits

and

lower.

the

to

equity

and

divi¬

There

are.

amounts

securities

of

that

Study

an

even

recently, as many of you. a
year.
Evidence
supports
the
the Bureau of Labor view that the long-run movement
Statistics
released
its
study
on
of labor costs, and hence the price

are

be

source

Output

Just

Federal
also

1956 have been rising at
faster rate—roughly 5%

1955 and

Man-IIours

reported earnings to
will, of course,

but

dends—will

growing needs and the ob¬

is

stockholders

higher, cash earnings—the

In other words, we

about

net

higher,

taxes

in mind is that whatever
done should be for the good

clearly

of the whole.

accelerated

denied,

premise we

on

If

no

because all the inter¬

It

aware,

man-hours
the

basic

steel

United ..States.

formal

unit

per

look

y

in

level,

industry of the
is; the first

Let

output

.This

that

recent years at

of

we

have had

in

productivity trends

will

sidious

upward."

be

assure

me

labor

of

trend

productivity
gains- was
very much in the minds
of the
managers of the American steel
industry

as

the time for negotiat¬

this

year's
approached.
In

no

a

private

room

for

labor

unit
of

costs

-

that

doubt

Sherrerd

ESTABLISHED

the

if

wage

the

prices

The record

period immediately prior to

World War II and the

rose

1910

and

up

there is

productivity,

goods will Increase.

of the

&

go

contracts

economy,

costs rise faster than

Butcher

costs rto

exceed

ing

war

period after

shows that money

faster than

had

we

Considerations

clear

before

long-term

ployees,

to

those

of

us

set

a

of

major

interests

best

stockholders,

To

secure

a

of

em¬

customers

These

were:

long-term contract

—five years if possible but no less
than three.

in

To try to get employment costs
more realistic
relationship with

productivity, since not only
ployees, but also stockholders
consumers are

the

benefits

CORPORATE

AND

'

•;

>

v4

;

■

MUNICIPAL

•

'

\

\

of

productivity

We
costs

*

wanted

produce

needs of
We

stabilize

labor

that the companies could

so

go ahead with

to

to

expansion programs
to meet the

enough

customers.

our

wanted

to

avoid

the

wastage of strikes every
With the threat of strikes re¬

year.

moved,
on

our

customers could count

steady supply and

bilize

their

pliers,

could

inventories.

Stock

Exchange

Philadelphia-Baltimore

-

American Stock

Stock

.

sharp peaks and valley of
demand, and our operating costs

would

benefit

from

a

more

Finally,

we

thought

it

a

ployees be stabilized so that they,
too, could plan ahead.
These

the matters most

were

minds when

our

we

went into

gotiations with the Union.
mit

the
as

of

I

PII-4

they should have been
major considerations
well, for the seeming conflict

interest

disappears

when




you

I
want our employees
to make
larger and larger "real" incomes,
not just more dollars of
steadily
diminishing worth.
I want our

prices to customers to be

possible.
owners

lieve

And
earn

I

want

enough

fair return.

a

there

is

any
in those objectives.

However,

as

the

low

as

enter¬

to give the
I do not be¬

inconsistency
*

these objectives

not be achieved if

one

can¬

party must

be served at the expense of others.
Our era calls for industrial states¬

manship.
manship
I

ers.

It also calls for states¬
on

the part of labor lead¬

recognize

labor is

political
cate

are

pressures

the

These

that

organized

having its growing pains,

and that there

lives

men

of

have

competitive and
which compli¬
labor's

their

leaders.

very

real

very great power, and with power

Underwriters

Trading Markets

Pennsylvania and General Market
Municipal Bonds

SCHMIDT, POOLE, ROBERTS & PARKE
SOUTH

BROAD

New York Telephone

BArelay 7-4641

sub¬

that

Union's

lake a good, hard look at it.
As
the manager of a large
enterprise,

PHILADELPHIA

Teletype

on

ne¬

productivity with

123

PEnnypacker 5-2700

good

idea from every point of view that
economic conditions of em¬

the

Members Philadelphia-Baltimore Stock

Philadelphia Telephone

con¬

stant rate of production.

Exchange

PHILADELPHIA 2, PA.

sup¬

such

Exchange (Associate)

1500 WALNUT STREET

sta¬

As

wouldn't be faced with

we

High Grade Corporate Bonds and Stocks

MEMBERS
York

eco¬

nomic

problems too, but they also wield

■

New

in¬

wages

-

SECURITIES

and

creases.

Retail Distributors

-

em¬

entitled to share in

Underwriters, Distributors, Dealers in
*

us

negotiations that

and the country.

prise to

that this in¬

you

Labor

seemed

considerations which involved the

work force which has the

factor

labor

wiped out.

Steel

out,

capacity
of that duty.
We intend to do and willingness to learn, change
everything possible to make our and adapt." I certainly have no
contribution
through more effi¬ quarrel with that statement.
cient operation and thereby offset
Very wisely, I believe, the Bu¬
as
much as possible the growing
reau of Labor Statistics didn't un¬
employment costs.
dertake the job of deciding how
I want to expand this point be¬ much of the
industry's productiv¬
cause I feel it is of utmost impor¬
ity gain is due to
the
human

should

economy,

with

study

.

Responsibility

has

us

inflationary

logical to expect that

not

customers, and in consequence

the
be

to

increased

productivity.
as a whole should
benefit from greater growth, vol¬
ume and
earning power.

the

As

that

is
a
human
going to need understand¬ there
factor
here
help on a lot of fronts. We which is impossible to pin down
a colossal job to do, and we
to any figure.
This human factor

context of

The country

our

appreciate

to
better
representative mix of rolled steel adjustments for this purpose need management in the steel industry table
machines
and
products, a million tons of ingot not be drastic. A relatively small has a very clear-cut responsibility techniques. Deciding that one is
in
capacity would produce billings of increase
earnings
per
ton for unremitting effort and prog¬ not the proper function of BLS.
some
$85 million.
Take a profit spread
over
all
products
will ress, namely, increasing the ef¬ But living with this problem ils
margin on sales such as Bethle¬ maintain or improve the return on ficiency
of
the
operation
and something that is very much on
hem had last year—8.5 cents net investment.
holding our unit employment costs the minds of those responsible for
income
per
dollar of total rev¬
reasonably
stable.
The
latter decision
in
the
American
steel
Government Responsibility
enues—and
means keeping increases in wages
your
net profit per
industry, for here is where man¬
One great assist which our Gov¬ in reasonable relationship to in¬
ton is around $7 per net ton of
agement's responsibility to • em¬
ingot capacity, which
isn't too ernment made was through the creases in productivity.
ployees, owners, customers and
good a result on an investment accelerated amortization route,
I believe 1 can say for the whole the nation comes into sharp focus.
of $100 per ton and three times permitting for
tax purposes de¬ industry that
very tangible prog¬
as
of a large part of the
bad if the investment is $300. ductions
Wages and Productivity
ress
has been made in the post¬
Since we may assume that new cost of new facilities over a 5-year
war
The
years
on
the technological
economist,
Sumner
H.
facilities will be more efficient, period in lieu of the normal de¬
front.
Today, more and more ef¬ Slichter, put it this way not long
the $7 figure could be raised some¬ preciation
rate.
This
has
been fort is
being put into research and ago; "In recent years the engi¬
what, but the story would remain very helpful in returning cash to the
development of new and more neers and managers have raised
essentially the same.
keep me ball rolling, but under efficient
processes.
In addition, output per man-hour faster than
existing Government policies it is some
significant steps have been ever before—about 3% a year for
Serving the Total Economy
being denied to the steel industry made in the
right direction on the the economy as whole. But wages
;
What
is the answer then?
It for the future expansion program.
employment-cost front as well.
and fringe benefits in the years
seems

has been

in the steel wage

are

want

gain
jobs

expect
to
of more

creation

well

can

unit

year,

haVe

customer

in

been cheapened and a
large
portion of the apparent wage gains

same

increase

resulted

increases

The result is that the dollar

has

economy

technological

make

vary¬

the

the

as

pro¬

achieving.

which

Thursday, December 13, 1956

.

This Government

up

making
ductivity gains which, while
ing sharply from year to

dividends—a

would

comes

rate

shortsighed because it would fore¬

his

of

value

the

only

policy

grov/ing requirements and at rea¬

sion.

of

One

a

in¬

new

to
able to get more steel to meet

and

how
we
are
going to add new steel
capacity costing only, say, $100
per ton today and perhaps $300
per ton
or
more tomorrow and
arises

question

expect

any

be

the

in

now

The

on

not

in

decrease

a

yards and fabricating works. Those

The

should

investor

price

cash

have to reduce expansion plans.

all.

reasonable return
and

earnings

ditional

which if done properly,

benefit

vestment

the

additional

higher

jective is to serve better our total

spectable return of 13.4% on our
total
invested capital.
That in¬

sion

erate

industry.

study

trie amortization front, steel man¬

...

N. Y. Phones
REctor 2-1695

IlAnover 2-4556

T eletype
PII

538

Exchange

STREET

(9),

PA.
Phila. Phone

KIngsley 5-0650

Number 5594

184

Volume

The Commercial and Financial Chronicle

.

.

.

(2555)

increased from $788 million to $2
billion and $97 million, and, on an
adjusted share basis, dividends
Labor
Supply and Demand
were. UP from $2.00 to $7.25 and
One of the basic reasons for la- face. Perhaps I may have created earnings from $3.93 to $18.09.
bor's
strong position today was some apprehensions that these reDuring this time, our annual1
recently summed up by Dr. Lionel :sponsibilities and problems are so ingot capacity has; grown from

is very

real trouble.

Now I have had a good deal to

about management's responsibilities and about the problems we
say

,

Edie

D.

in

trends/

of population; serious

study

a

the decade of the '50s the

to

as

with me that the problems associated with decline, stagnation and
a contracting economy are a lot
more troublesome to solve than
are those associated with expan-

sion and growth such as we now
rapidly. That is to be expected, face. If I had to choose I would
defy solution — at around 13 million net tons to 20 But we feel strongly that there it prefer what we now have,
investors' point of million net tons, and we are still a complete identity of long-range A
-- '»
-

out that during* least from the
number view. If that is so, I do not want

He points

production will not at all times be
geared exactly with demand. We
anticipate times when consumers,
will think expansion is proceeding
too slowly and times when investors may think we are moving too

The Postwar Record

responsibility or the result

comes

59

growings As

,

we

interest for all parties concerned

have grown, our

thousands and —the country as a whole, inves-.5 T. H. Smith to Join
crease
-by only 6% while the num- with you. , . .
thousands of small suppliers and tors, consumers and employees—
ber of people of nonworking age—Problems are always with us,- customers has also -grown, illus- inAhe type of orderly expansion
;
under 16 and over 65 —will in- r usualiy
looking Ja lot worse in trating the fact that big business 1 have just described,
Cyrus J. Lawrence & Sons, 115'
urn 11
inc;
hi
icnu»
o
i-"
^
*
•
• - A
xr.
'
crease-by 36%. Irt other words,; prospect than" they do in retro- and small business,> far from being
Long range planning for expan-.* t»
we have a supply-demand
factor ' spect. If we face greater respond a* cross purposes, are essential to! sion on a basis which would br Woaaway,;K€W. york 'uty,' ra«nbers of the New York" Stock Ex¬
at work here which is bound to
sibilities and problems we do so each
others growth and pros-'- continued even if there were a
change, announced .that Thurston
have its impact on wage patterns,
with the benefit of more experi- Perity.
1
:
/• recession implies another responH. Smith will
people of working age will

of

dependence

in-. to leave any such false impression

on

Gyros J. Lawrence

uy

uv w.

Dr. Edie states that this supply-

'

is ; the

situation

demand

of the middle
fifties. He says that this is a time
when wages will increase in each
year about 1V2% more than will
productivity. In turn, this means
that the all-commodity wholesale
price index will increase some
15%
during the decade we are

Nothing
ment has

labor,

industry,
can

pal sources of Bethlehem manage-

facts

with

me

...

R

c,

,

,

Bethlehem Steel As Example

:

Progress

Employment

on

just how economic
historians of the future may look
not

We

sure

results

the

of

negotiations,

steel

1956

but I

have

its

and
v

of

the

Korean

aftermath,, with

War

creeping and other variehad strikes, price

good sense

some-

were won.'

.

turn

.

now

out

goods

and:

services<:pacity
In ad-

has wider acceptance:

dition, ;the

idea

stockholders

and

that
the

and. on the other hand

constant

public gen-;

erally ought to share in this increase, as they should, has gained

to

pressure

consumers,• countrv»s

manifest

meet

.

You

* hbm

for

more

•

niay

well ask how Bethle-

survived.

,

during

Well,

the

currency.

>
; ten-year period ending on Dec. 31
We did win three years of peace-; last year we invested in our plants
on.the labor front and I think we: and properties some $930 million
■

have.made
pay

some

points which will A and added $443 million to working

off in the future—for everyinvolved.

capital, and

other

assets.

-

Funds

with

Gross

Rogers

South Figueroa

559

Street,

,^ut

Future

Prospects and

Obligations*

- Now I have finished the picture • pa^adfna Pniif
T«fif
have
r™
rAoAUHiiNA, Calif.—Latimer E.
j have tried to paint for you and n
■
J'
' , ,,X «ar.
i hope I have not over-colored the; hi ®
„
HpnHmnn
t

va..

good or the bad.

lems

we

have

an

discussed

with
■

front

tion to promote the stability as
well as the growth of the econr,
omy. At Bethlehem we feel that
our contribution to this goal can
best be made through carefully {

in

are

!(

y--•~">r

/.

With H. C. Wainwright a
(Special to The Financial Chronicle)

the

on

tho

nart

rnVe p%eeLao\

BOSTON,:. Mass.
Long/ Jr., is now

Growth

labor

result

of

a

order of affairs which is stiU

new

being

perfccfe";

Perrin
with If.

—

We

simply can't do the job alone.v

rapid

United States, a free people
sharing in a material prosperi'ty which has never before been

and Boston Stock Exchanges.

*n

„

-

- - *

if

in

addition to the

happen.

that during the same period sales

"

'

<

'the'face,of this gl^ ;

GRAND RAPIDS> Mich;_Henry

trends which govern the demand

balances still have to be worked

ol,t- These balances will be worked
;
f, •'
out;.I firmly believe

our Programs.

;

-

•

McDonald-Moore Adds?/
(Special to The Financial Chronicle)

v'

We do. not intend to be high^,
Investors with a faith in the
pressured : into overly ambitions virtues and rewards-of free proC-^
plans during booms, nor do we esses have made a- fundamental
plan to cut" back -drastically if contribution.; I , don't- thin-k theirs
there should be periods of reces- faith has been or will be misplaced.
sion. New facilities coming intoI do think that you will all agree

DETROIT, Mich. —^.Harold R.
Chapel,' Jr., has joined the staff
of. McDonald-Moore & Co., Penobscot Building, members of the
Detroit and Midwest Stock Exchanges.
/ ;
. i

DREXEL & Co.
Established 1838

1

\

t

,

4

.»

(,

*

%

j

^

«

'

*

Distributors

Underwriters and
i?-;

of

J.

SPARKS & CO.

.

Public Utility,

Industrial and Railroad Securities

*

'established*
«.

NEW

YORK STOCK

leoo v

MEMBERS

.

EXCHANGE

State, Municipal and Revenue Obligations
•

.

PHILA.-BALTIMORE STOCK EXCHANGE

-

AMERICAN

STOCK

EXCHANGE

-

,

Brokers in

LISTED and UNLISTED

Members

SECURITIES

New York Stock
Dealers in

DIRECT

120

York

worth

5,

N.

ft

WIRE

T.

Y.

4-0220

TO

NEW

TELETYPE—PH
2IO

Broadway

New

T.

Western

Broad

&

f-ri.

622

Philadelphia X

Savings

7.

Fund

New

York

5

bld«.

1.500 Walnut

Sts.

Pa.

6-4040

.




{Assoc.)

Philadelphia-Baltimore Stock Exchange

YORK

Chestnut

Philadelphia

KIngsley

Exchange

American Stock Exchange

STATE, MUNICIPAL and REVENUE BONDS

A-.

>

5

(special to the financial chronicle)

-

conceived and realistic plans for Wiser management and organized, j olah is now with Cruttenden
expansion. Our intention is to' labor have, both contributed tO podfesla & ^ McKay Tower,
£ear our expansion, to the basic this- prosperity. And some ot the
<
:
<
.

*

to

J

With t^ruttenden rOCiesta ?
^

amortization,- depreciation

the job> and depletion of $515 million.,
pres-What have been the results of
sures - applied
at- the bargaining/these great expenditures made in
table -we are subjected to pres- • the process of coping with our
sures
from government: to- settle^ many problems and-heavy responon terms which are not consistent; sibilities?
How have the investors
with the best interests of everyone- fared?
Most, if not all of you
involved. -That has been■; known - know, but I leave it for the record
particularly can't do

alone

H.
C.

^Wainwright,' & " Co., .'60 '-'State
Stre6t' members of the New York

.

We

-East;

<£riJSenderson'

with

those

expanding

an

-difficulties

Our

obliga-

you

are

"

The- Problems-of

to the future, our goal is to
equally' well in meeting our
problems and responsibilities.
"

believe

have

economy'

As

We

I

associated

do

.

I leave

tills oiie'brief'thought: the prob-

of

sense

our

mem-

bers of the Los Angeles Stock Ex->

for these purposes were provided
concern about" our responsibilities' through retained earnings of $614
to .all'; parties, will
have to be., million, net sales of securities and
shared by union leadership if that; property of $244 million and nonis to come to pass.
cash charges against earnings for
one

Co.,

&

change He was lormerly Presilabor organizations and the Fed- oent of M. G. Chamberlain & Co.
eral Government, will meet its ob- ligations to all concerned in a sue-. JHarbison Henderson Adds J
men who have, the opportunity to cessful manner.
5
(Speciai to t»e finance Chronica)
•./'

for steel products and to stick to-

need

capacity^

a

the

equal sense

an

asso¬

ciated

of responsibility on the part of

inflation

We have

ties.

a

the

had

have

-victories-" for * controls and materials allocations,
I know the< excess profits taxes, and constantly
idea of a long-term contract ap-1 increasing pressure for high wages
peals to the man in the mill—and >.and greater fringe benefits which
to his' wife.' And it seems clear • cause dangerously, high' employthat the necessity
of restricting ment costs.
:
■'
future wage increases in general;
.
have had
some
investors"
to the.nations increasing ability
fears of excessive production cathat

feeling

to

munity and with

ment That is not the only surce,
however, as we bring into our orfianization each year many other
college graduates and other young

*

■

the

few

a

to

Let me consider the problems develop from
in the organization. Promotion
within is one of our
which Bethlehem, in common with motion from within is one ot our
the rest of American industry, has principal personnel Policies, andfaced since
1946.
We have had
it is supplying us with the conti-,
ground ' faced since 1946
booms and recessions, the liqui- nuity °f managerial skills which,
dation of World War II and all of an enterprise such as Bethlehemthe implied readjustments.
Costs
must have.

may gain more
than Dr. Edie predicts

wage

have

I

the Bethlehem Steel
Co. It seemed reasonable that I
choose an example close to home,

government,

and

inflation

on

*

close to a sure thing that
responsibility is lacking,

such

am

investment community comes in
.**• y
"
You can help us in determining witn das. ti. Uiiphant & Co.
how much debt we can prudently
With Gross, Rogers
handle and how much of the ex"Loop Course'] for the employ- Pension should be financed by re(Special to The Financial Chronicle)
ment and training of college grad- tained earnings or by the sale of
LOS ANGELES, Calif.—Marvin
nates, which was initiated back in equity securities,
G. Chamberlain has become
1922» has long been recognized by
I am confident that the manage
the Bethlhem organization and by ment of our large industries, with
the colleges as one of the princi- the help of the investment com-

hope that this self-defeat-

is pretty

I

success

postwar record of sue-

a

relating

ing wage-price spiral can be held
to more moderate cproportions. It
if

join the firm's in¬

that

statesmanship and genuresponsibility on the part of

we

like

T

vestment Advisory Department on
Jan. 2, 1957.
In the past he was

cessfully meeting its problems. I
could cite you examples of many
companies but it just so happens

Given

ine

succeeds

and America's industrial manage-

in.

now

predecessors, new manage-

ment techniques, the cumulative the prime responsibilities of manand growing forces of science, agement—that of maintaining a
more
know-how all the way defense in depth of competent
around.
managerial talent.
Our famous

this period

in

our

sibility — that of keeping financially strong. That is where the

And on another front we have
kept very much in mind one of

the accumulated knowledge

ence,

of

reason

why the labor unions are able to
negotiate an excessive wage pattern

,

_

St.

SO WTall Street

€0

The Commercial and Financial Chronicle

(2556)

Continued

froin first

of

Baltimore,

Report

Mead,
the

to

his

received

end

the

Red Cross

the

degree

Scarsdale

of Pennsyl¬

University
■'/

vania.

S.

B.

placed
Youth

Club

of New York.
In 1932 he!
joined the Guaranty Trust Com-'
pany
of New York, and after,
working in the investment ad-/
visory department, the trust de¬
partment, and the Fifth Avenue
office, he was appointed an As¬
sistant Treasurer in

named

in

Vice-President

and

Treasurer in
He

and

Director

Securities

can

Mr. Craft is married to the for-; follows:

Sullivan

Janet

mer

in

lives

and

have

The-Crafts

Scarsdale.

,

Corporation

Craft has

President

Bankers

of

the

S., and

two

daughter, Carol Ann.

a

Speakers at the Convention

,

fronv

The

principal

speakers

at

of

Chairman

ciation's

F

of

i g n

o r e

Committee, which

Vice-

a

Investment
established

was

capacities:

Committee,

1939-1947,

Chairman

of

1948-1956,

the

Committee

1950-1953;

Executive

to

the

member

Committee,

of

1953-

Davis,

W.

President

Bankers

Association;

curities

and

Exchange

major

Bethlehem

the

Eugene

Maynard,

Steel

Industries

of

the

"The

Governors

of

of

the

Reserve

Consultant
Bank for

System in

to

the

He

the

is

trustee

poration.

[These

Executive

member

Committee

of

of

are

New

for
York

Missouri
pany.

and

Savings
and

a

Pacific

in the

Director

Railroad

Mr. Craft is also
member

of

of

the

the

:

full

Reports

Role

of

the

Banker,"- Edward

Stock

Exchanges

3

NuK.S.D.

,3
3
,3
,3

on

Members
Stock

Detroit

DETROIT

of

60%

Carrol

"A

Other

and

Companies,"

Classroom

Project,"

Charles

Edward

(N.

Finance

Harold

Others

EXCHANGE

In

for

Y.)

Face

the

E.> Wood,

Present

639

3

on

addition to the teacher dele¬

fessors

Request

were

in

Tel-phone WOodward

200

2-5625

Building;
26
Bell

,3

System Teletype DE

206

DETROIT

STOCK

MIDWEST STOCK

EXCHANGE

EXCHANGE

Undenvriters and Distributors

the

the

of

be

an

.#•

Executive

'*•

of

took

the

secu¬

in

part
as

the

speakers,

Institutes)

black.

A




In

W.

were:

IBA

Carroll

ence

the

representatives
attended

of
the

the

project: the

speakers

and

Building

was

The

MUSKEGON

educational
all

The
from

parts

teacher
all

states

over

tele¬

the

to

prints circu¬

Modern, the follow-,

are in use:
108 prints
by IBA members; 38 prints

owned

school

to

Group
by

for their

Program

Department

S.

film

the

leaders

of

has been

of

used

State.

to

Adapt
U.

The

extensively in

Invest-in-America

USIA

Last

program.

Opportunity

S.

of

tures.

The

receipts

license

A.

reserve

.an

dwindle

unsatisfactory

This

is

our

condi¬

to

government

1957

operation

April

❖

Institute

15-19, the

Easter.

the

mittee

its

start

of

was

this

cities
than

year,

sored

motion

by

work.

made by the

chartered
120%

The

in

against
1955

the

such

At

spon¬

UNDERWRITERS

*

«

Youth

Hollywood in his Inaugural,
the importance of

ties business

in

tion

with
fropi,

in

and

in

younger, men

those

January,

urged participa¬

Association affairs

in

the

the

30-40

by the

industry—

age

bracket.

DEALERS

•

the
the

•

BROKERS

•

DISTRIBUTORS

MIDWESTERN

ACTIVE TRADING

SECURITIES

MARKETS

BAKER, SIM0NDS & CO.
ESTABLISHED

1920

—

gen¬
MEMBER

ar¬
the

BUHL

BELL

DETROIT

STOCK

EXCHANGE

DETROIT 26

BUILDING

TELETYPE—DE

PHONE—WOODWARD

1058-9

drawn
WIRE

TO—

country.
came

Union, al¬

as

youth to the future of the securi¬

sponsors

and

pictures

on

great stress on

Education

the

Committee have cooperated

beginning,

been

■

President George W. Davis placed1

22

increase.

IBA -'and

the world.

have"

organizations

Accent

more

a

—

over

the

econ-,

Company, Stand¬
ard Oil of New Jersey and the
Ford Motor Company.

movement dur¬

as

explain

General Electric

ing 1956. and 49 celebrations were
held

Associa¬

being made by;
to

the American

*

progress

contribu-.

our

adaptations

including

Invest-In-America

Real

its

There is to

made of many industrial pictures,

before

week

of

part
effort

peoples all

Similar
scheduled

is

Shortly after the Conven¬
Institute Planning Com¬

will

the
the

omy to
*

*

.

.

The

of

part

a

worthwhile

a

on

tion

tions.
'4"

as

tion

generally

business

use

program.

no cost to the
IBA, all charges
being paid by USIA.

future

of

reflection

in

in

for

be

continuance of the program with¬
out cost to the Association should
enrollments

the Agency to produce
language versions of the.

world-wide
the

assures

the

to

foreign
picture

expendi¬

over

Spring

United States
Information Agency made a form¬
al request and the IBA granted a

has been established.

—DIRECT

delegates
of

or

suoervisory training pro-:
prints purchased by the

3

U.

the

systems

15 prints pur¬
Motor Company

use;

Ford

gram;

con¬

1956 Institute also showed

excess

caliber of

provided to meet

with
from

E.LANSING

rea-,

well
seen

in¬

erally, the excellent^ physical

tunity that

seems

Confer¬

program

is

ing prints
presented

representing the
receipts over expenses

in past years

highly enthusiastic about

are

entire

the

.

Com¬

mittee, (Friday noon); Ruddick
C. Lawrence, Vice-President, New
York
Stock
Exchange,
(Friday
evening);
William
M.
Adams,
Chairman, IBA Municipal Securi¬
ties Committee, (Saturday noon);
George W. Davis, IBA President,
(Saturday, evening).
All

.

audience

Mead,

Education

year

"Opportunity U. S. A."

addition

lated through

reserve

of

the

various

the

(a

-

on
the part of
Industrial Council, and the oppor¬

DETROIT 26, MICHIGAN
GRAND RAPIDS

casts of

The program is not intended

chairmen

of

TV

readily verified. It

show

to

self

j

our

audience

however, that
20,000,000 people have

ducted without cost to the Associa¬

tion.

estimated

chased

been

for

sonable,

-t

have

Invest-in-America

rangements

FLINT

be

264,

(the two Seminars and

four

of

determined by formula and cannot

The executive development pro¬
gram

advance

.

;The

additional 34

Development

in

available

held for

••

hands

screening and 15 prints available
use by TV stations.

accepted.)

were

the

now

Summer of

agency continue to be

well

prints

could

of

in

for

in

facilities.

total

a

to

you

Invest-in-;

and the film maintains its
circulation momentum, with 175

accommo¬

—

Listed and Unlisted Stocks
Penobscot

distributing

large demand for

places, however,
applications, or

want

the

since the

use

Prints

booked

registrants—

available

phases of the Conference.

dustry that

Municipal and Corporate Bonds

pro¬

education

session chairman,
moderators, pan¬
elists, members'of various plan¬
ning committees, or in adminis¬

sessions

McDonald-Moore & Co.

of

either

Chairman.

MEMBERS

230

I

much

>

ahead)

(Provision had

Approximately Invest-in-America

groups.

business

The

lfe|jajaiSS:2i3!S©aSiaj0ISJSj5J2]3ISiaia^^

field

representatives

trative

MEMBERS

for

that

the

National Committee ap-..

in

1952.

70 second year, and
year,
the number that

view

tion

and many of thein
panel members for dis¬

as

rities

EXCHANGE

the

meeting
Penobscot

In

present,

served

EXCHANGE

DETROIT

made

third

for

m

gates, college and university

Invited

STOCK

60

'

of prescribed commission

DETROIT STOCK
MIDWEST

been

President, Harold E. Wood & \
Company, St. Paul.
;

cussion
,

applications

be confirmed.

years

and

Future,"
'

been

In addition, there were some
70

and

how

"Opportunity in U. S. A.," has

regis¬
254

from'

of

Opportunity U. S. A.

There

264

excess

Schools

Eaton, Jr., President, Eaton
Howard, Incorporated, Boston;

Committee,

Members

.3
,3
,3

of

against

as

to

Our Association motion
picture,

*

STOCK

Exchange Listings
Inquiries

,3
3
3

3
.3

the

year

cities

because

predate it."

Invest¬

facilities.

enrollment

this

to

not

T.

F.

i

'

Executed

this

Banking

of

cities

wonderful

a
profit but merely be
supporting.
However, the
registration fee should be high
enough to show operation in the

for

ATTENTION N.A.S.D. MEMBERS
Orders

available

an

1955.

in

Edward

IBA, '

Surely

the principal'
have increased the 1956

we

50

know

organiza¬

Institute

by

'

3
,3

the

conveniently

■&

CHARLES A. PARCELLS & CO.

3

the

60

Over-The-Counter. Market,"

"Investment

0

.3

member

dated

of

"Education

)

Investment

of

Partner, Shearson.
& Co., N. Y.;

Walter W/Craigie,
Partner. F. W. Craigie & Co.,

,4

'

of

could

Schweikardt, Nyack
High School; and

1919

of

to

America

con-;

Richmond;

through its Chairman, W.

Established

Busi¬

the

numerous1

by the IBA of the
Invest-in-America Bulletin. It was

appre¬

Projects,"

Activities

Education

The IBA

con¬

tnat

success

Waiter

State and Local Governmental

io
,a

Securities

Economy,"

"Funds

;

Committee

Year's

On

Com¬

Executive

24.]

Education

Director

a

in

Reports,

given in this issue starting
page

City of

by

Troster,/ Partner,
Troster, Singer & Co., N. Y.;

The
on

Bank

addresses

those

the

to

deep

our

all

of

in

trants

Oliver /J.

text, and Committee
and

of

v/as

field

McCormick, President, American Stock Exchange, N. Y.;

President

International Finance Cor¬

"The

Reconstruction and De¬

a

Garner,

\

the

1952 and

International

velopment in 1954.
,

L.

Robert

Fed¬
of

eral

Role

Our

Corporation;

Consultant to the

Con¬

Glassmeyer, Vice-President,
Blyth & Co., Inc., N. Y.;

Jr.,

effective

Banking is steadily grow¬
ing, and in 1956 applications were
received
substantially in excess

securities

the

"Underwriting—The

Corpora¬

Trefethen,

E.

this

Perspective,"

Hammill

Commis¬

Vice-President

Executive

and

Board

of

American
in

cities.

reason

100 first year,

ness

Se¬

local

ment

social"

the

the activities of all

segments

"The

the

express

Interest

year.

investment

Investment

tion;

we

Institute

business:

sion; Arthur B. Homer,' President

Kaiser
was

the

who discussed

Davis,

1956.

Mr. Craft

in

from

nationally and at

venture, either through planning
and participation in the program
or
through financial support.

the campus of the

on

the

Chairman of

in

attended

Sinclair

J,

past

delegates heard addresses

leaders

Investment

of

administrators

the

Skaggs & Co., San Francisco, out¬

going

of

1941-1943,

Assistant

George

ning;

Armstrong,

Member, Government Securities

the

Special

received

both

publication

At

Asso¬

have

we

Council of Rensse¬

and

tributed

Institute at Troy, N. Y., Oct. 11-13.
luncheon and dinner meetings

Stewart Brag-

J.

President for Public Works Plan¬

the

that year. He also has served the
2BA nationally in the following

and

(tcneral

Major

!

21

ciation

Nearly 600 high school teachers^

ference held

"I again want to thank
you very
for the cooperation which

much

is

tee,

Industrial

during the

field

national,

•'/
O

for

tions

science

and

*

project. On behalf of
the Conference Program Commit¬

Securities Busi¬

sponsored by the

and

state
v

40

Institute, represents one of the
major activities of the Education

the

menting on the contribution of the
(67),; IBA, Walter A.1 Schmidt, Chair-*
(25).man,
Executive Committee, Na-.

activities; from

-

.

.

Committee

England

facilities

Mea<?

Council of Rensselaer Polytechnic

'

<

the

Com¬

Jersey

duct of the

the American

ness,

George

Robert H., Jr., and

Investment. don,
America

Association

also

and

been

W. Carroll

to

1

'

of

Bulletin.

initiating the idea and
the excellent provision of physical

Participation in the Conference
on

1953
until March
of
this
year, Convention
were
President-electwhen he assumed his present post
Robert
H.
Cratt,
who
is also.
at The Chase Bank.
'
President
of
The; Chase Bank;
From
1953
until
the
present

time Mr.

laer,

dale Golf Club and the Fox Mea¬ role and investment opportunities.
dow Tennis Club, Scarsdale, N. Y.¬
The
Report states in part as

Ameri¬

the

as

edition

Educational

delegates in turn

*

Industrial

the

,

d

an

72-page special

a

Invest-in-America
IBA

j All of us in every phase of the
securities business are grateful to

investment's

Vice-Presi¬

of

-

1956, published

a'

New

report to 40,000 other

/'/.''v.

stu-

adults

Club, Purchase, N. Y., Scars-

and' sons,

/

Executive

was

dent

1947.

Golf

ntim-

of

dents

was

Vice-President

Second

a

1943

He

1938.

Street

Wall

bers

Club of New York,
Club,- Blind Brook

Bond

York,

creasing

New

New

(36), Ohio

meetings and
publications,

on.

train-4.

<)i ing campaign
and society memberships
and
plans to
Economic Club of New. educate
in-;

Upon completion of his formal include:
education in 1929, Mr. Craft wasi York,
Pilgrims ; of
the
United.,
employed by the Guaranty Com-> States, University Club of New
ftany

is

Accent

Campaign Fund in

(210),

(116),

miles:

Thursday, December 13, 1956

.

tional Invest-in-America Commit¬
social, tee, wrote to W. Carroll Mead,
science teachers through various
Chairman, IBA Education Com¬
media: local, state, and national
mittee, as follows:
will

its

on

three-fourths

300

These teacher

d ucational

1956-1957.

for

about

State

States

activities.

Chairman-of;

is

of

Pennsylvania

Emphasis
and

Association

radius

.

York

e

Committee of the New York Heart-

Cedarhurst, N. Y., attended the
Manlius School in Manlius, N. Y.,

•

than

more

represented communities within

its

covering the
scope
of its

Holds 45th Annual Convention
In

'

though

Com¬

&

submitted

Con vention

Investment Bankers Association

from

Miller

Mead,
pany,

page

.

.

TROSTER, SINGER <fc CO..

NEW YORK

1-3670

Volume

Number 5594

184

.

The Commercial and Financial Chronicle

.

.

He stressed the importance of thej and
v/ork

and

committees

such

various*

the

by

performed

IBA

that

urged

of the future.
.*

'

■

;

9

..

.

'

;

the

'

...

r

r

Course

firms.

Publication

Securities

on

The Accent

of

on

Youth

files.

are to ''Manual on Securities Salesman¬
professors ship," prepared under the direc¬
and
scholars,men in the field tion
of
George W. Davis. The
of finance who write monographs,
booklet is now in its sixth print¬
textbooks
and -articles
for
pro¬ ing.
To date it shows a net infessional
journals
and
popular come after expenses of well over
periodicals.
In its present form $5,000.
Many members repeatedly
the wealth of material prepared
place quantity orders.
;'V,
by legal and research staffs of

made

available

More

than

•

IBA

200

member

for

ees

the

home-study

course.

of

this

training

opportunity of¬
the University of

fered

through
Chicago.
Thirty-seven
have

five

enrolled

ployees—one firm
It

is

many

members
more

or

em¬

32.

as many as

interesting to note that
non - member
securities
are
taking advantage of

,

dealers

the program and that young men
ih the Armed Services are reg¬

istering
USAFI.

the

for

ible. .Publication

of

be

of

the

valuable

most

;

findings

V Investment Banking

"Fundamentals

-

Brazilian

•

the

official

The

research

ent

text

Association

text.

mentals

study and the

will

pres¬

of

-A

Council

that

satisfactory completion
correspondence course is

s

for

9

9

de

of

Brazilian

Banking"

Investments

(Consorcio

Brasileiro

Education

become
upon

of Stock Exchange Firms in
Secondary
Education., sponsoring a two-page insertion,
The program is sponsored jointly "To the Young Man Who Is Inter¬

he

bv

York

one

Exchange

curities

Finance:

of

Mechanics

the

on

Stock

Institute

and

Analysis.

IBA

tional

Better

Investment

■

ested in

Secondary
and
the
Na¬

Business

improve education

Bureau.

in

economy

the

about

In essence,

ance

Joint

Committee

of

Finance.)
Education

on

sents

this program

invitation

an

repre¬

NASD, and NYSE — the IBA is
continuing its support of the Joint

extended

by

high school principals to the busi¬
community requesting assist¬
in

'. As

developing teaching aids.
result

a

determine

Together with other organized
groups
in the investment com¬
munity- ASE, ASEF, NAIC,

available at Hollywood.
Publications

the

in

Committee

awarded

74

it

1948,

Fellowships

has

and

152

Scholarships.

in

of

what

its

research

should

be

to

taught

lication of its two bulletins which
serve

Joint Committee,
Committee

•

of the

high schools about eco¬
nomics, the Council has published
two

ideas

is planning

to modify

its
program
by
giving
greater
emphasis to the granting* of Schol¬
arships ana conducting the annual

Forum.

Funds heretofore

Fellowships

provide
be

made

are

used

to

now

in

Economics"
the

Two

IBA

and

"Economics

Press."

IBA

ready

September, 1957.
One
deals with the functioning of the
American economy and the other
American

with

other

Seven

national

IBA

in

the

this
of

of

work

will

findings and

the

Committee,

the

IBA

Council, and

in

rial

Collected

the

Investment

Into

Connection
Banker

ing

in

with

booklet,

the

was

press,

with

voted

the

public

year

a

son

many

/

.

to

sent

to

the

Capital

requests

.Harry

ELECT

is

Member
10

—

David

J.

in

its

Lee

and

A.

;

to

—

De¬

fray & Hopwood, Minneapolis.

Mississippi Valley
>

Newell

Trust

S.

of

&

in

the
re¬

after

Pennsylvania

Sachs

J.

&

Creely,

Co.,

St.

New

Weeks, Boston.

Walter H.

Reproductions

of

Advertisements
to

IBA

Clarence

Goldman,

Louis.

King, The First Bos¬
Corporation, Boston.

E. Jansen

E.

No.

12

—

De¬

Nida,

Dean

Witter

&

Collins

J.

&

Charles
Watts

&

H.

Arthur

Sullivan, Jr., Auchincloss,
& Redpath, Washington.

Furman

C.

Arnold

Albro

&

F.

A. Evans, Clement A.
Company, Incorporated,

Texas

Texas

Pierce

Dittmar

Porter,

Company, San Antonio.

Underwood,

Houston.

&

&

,

Co.

B.

&

GROUP

Group

1956-1957

Company, Pittsburgh.

Incorpo¬
Sites and

Chairmen
as

The

of

the

follows:

California

,

McCarthy, The First

Corporation,

Dates

of

Next

Year's Convention

CHAIRMEN

are

Pennsylvania

Anthony E. Tomasic, Thomas &

'■*

-

Rauscher,

Almon,

Co., Inc., Dallas.

Western
A:

Under¬

National

Company, Kansas

City.
Taylor

Neuhaus

Alester G.

City

Sfepp,

Bank and Trust

Clement

C.

McCall,

Co., Incorporated, Green¬

ville.

Atlanta.

Boston

Fran¬

San

cisco.

*

Hollywood

Beach

•'

'

•

third

printing.

•

.

•

-_

'

•

•

'

selected

ing

Annual

the

as

of

the

.

site

Convention

meeting

will

for

the hold¬

Association's

be

in—1957.

held

Speech

File,

A

file

exhibit

of

period Dec. 1 to Dec. 6, 1957.

early in 1957.

Radio and Exhibit
JOHN L.

kits

T.

addresses,
is

radio

maintained

in

KENOWER

NORRIS

JULIUS POCHELON

REGINALD MacARTHUR

MELVIN

HITCHMAN

R. STUIT

and
the

IBA Washington office for use of
members, and copies may be had

.

Municipal and Corporation Securities
Specializing in,
Michigan Municipals and Revenue Bonds

Investment Securities
Kenower, MacArthur & Co.

Members:
York

Detroit

Stock

Stock

Exchange

Exchange

American
Midwest

Stock Exchange
Stock

FORD

( Associate)

Michigan

DETROIT 26,
Ann Arbor




Jackson

Trust

GRAND

MICH.
Kalamazoo

BUILDING, DETROIT

WOodward

Exchange

RAPIDS

GLendale

Pontiac

Building

1-2231

2-3262

,

(

Bcaringer Building
SAGINAW

PLeasant

2-7128

Members Detroit and Midwest Stock Exchanges

46th
The

during the

Advertisements—to

be available

WATLING, LERCHEN & CO.

New

Hotel,

Hollywood^ Fla., has again been

Underwriters, Distributors and Dealers in
I

Baker,

Southwestern

Arnold,
Crane, New Orleans.

H.

Pinkerton,

Co., Baltimore.

Southern

Wilson

year

v

Southeastern

Southern

The

J.

Mountain

Company, Denver.

Southeastern

R.

William

Portland.

Rocky

shall, Seattle.

&

Collins,

Co.,

James M. Powell, Boettcher and

Pacific Northwest

Mark

Lynch,

Pacific Northwest

Hunt, White, Weld &

Hudson
B.
Lemkau,
Morgan
Stanley & Co., New York.

Merrill

bus.

William

Co., New York.

Parker

The. First

Pierce, Fenner & Beane, Colum¬

York

Brown,
Co., New York.

Ohio

Davis,

Ohio Valley

Jr., Townsend,
Tyson, Boston.

&

F.

Corporation, Cleveland.

England

Francis S.

ton

Cleveland

Jackson,

Dabney

Dennis

Member

York

Steel, Drexel & Co.,

New York.

Jack

James

the

1956 Annual Convention.

England

Gannett, Hornblower

Northern

member

activities

shortly

V

Mercantile

Company, St. Louis.
New

Mississippi Valley
Walter

wood,

lations, and promotion—to be
available

Knight,

Thomas B.

Chicago.

M.
Wilde,
Janney,
Co., Inc., Philadelphia.

Dulles &

Bulletins

review

Mc¬

Minnesota

.

New

Milton

mailing pieces.

Group

Jr.,

McDonald,

Edward Howard, Piper, Jaf-

Higgin-

Harris, Bache & Co.,

Member
11

Kits

now

Capek,

De¬

mailing list of

the American Finance Association.
booklet

8—

America

IBA
No.

:

Donald, Moore & Co., Detroit.

Advertisements.
of

Machold, Drexel &

this

Early

of the pamphlet was
entire

No.

-

No.

Jr., Horn-

Chicago.

Pennsylvania

F.

Chicago.

H.

fields of education, public

voted

generally.

A.

Corporation,

Evans

Annual

co¬

community but from

copy

The

Charles

rated,

have been received not only from

Antitrust

Suit—designed to make generally
available in readily usable form
a
synthesis of the legal briefs

GOVERNORS

William

widely publicized

and

In

Lawlor,

Michigan

8—

member

IBA

Advertisements

-

dis'ribut-

"Equity

-

'

Co., Philadelphia.

IBA Educational Bulletin No. 10—

Small

IBA
in

of

Bulletin

of

Reproductions

Business Corporations."

Small

the

the

Committee

the financial

Mate¬

review

Education

voted

materials.

The Education Committee is
Business

sup¬

port to a new project of the Joint
Cbmmittee—Research

-

Advertisements

as¬

Small Business Booklet

v

The booklet

phur voted to give financial

Educational Bulletin No.

Special Invest

dissemination

text

Educational Bulletin No. 7—

Forthcoming

encourage serious study of invest¬

Education

Washington

Albert O. Foster, Foster & Mar¬

Reproduction

systems.

educational

facilitate

ment

Board of Governors at White Sul¬

Group

Edition.

sociations have become interested

for

the

IBA

the

.The following have been elected

Recent

lations, and promotion.

Capitalism

economic

operating

of

experiences.

and
Group activities in the
fields of education, public re¬

by

projects. This change in
policy is an outgrowth of the
most' gratifying success that has
been experienced with the Forum
operation and also the desire to

recommendation

and

are:

Annual

•

.

available to scholars for

the

member

William

Mon-

States

Weeks,

J

Special Manpower Edition.

teaching supplements are
preparation and should be

in

now

research

On

of

and

editions

to

community operations.

clearing house for the

a

exchange

reports: "Key Understandings

3nd

reports that the

as

the

contrasts

Amyas Ames, Chairman

from

Austin

Since consolidation of the IBA
offices in Washington, the Educa¬
tion Committee has resumed
pub¬

Cbmmittee

on
Education Repre¬
senting the American Securities
Ihdustry.
Since establishment of

tained

J.

&

G.

L.

Limited,

.

Eastern

member organizations through the
Committee.
A copy may be ob¬

New

high

the

ness

New

Institute

Everything," in the voca¬
tional guidance booklet,
"Career,
A Guide to Business
Opportuni¬
ties." Copies of this statement are

schools.

Banking,
is
ac¬
ceptable in place of the course on
Securities Analysis offered by the
York

Exchange and the Associa¬

tion

Advance-

J William

literature and services available to

cooperating with the New York

Stock

proj¬

a

seeks to encourage

program

American

respondence course, Fundamentals
of

is

of

Principals

and

cor¬

for

Association

School

',

blower

Education Committee and the

of

the

This

Council

the

ment

Se¬

of

one

The

of

ect

the

of

the

Bertram

Our Association this year again

corporations, is supporting

New

IBA

Eastern

the

a registered representative
passing an examination or
may
submit, in lieu of the
examination, satisfactory comple¬
tion of two courses offered by the

treal.

Tools

Beaubien,
Co.,

Central

Investimentos).
Recruitment

The

&

"Funda¬

Exchange in partial satisfaction of
registered representative re¬
quirements.
(An
applicant ntay

IBA

memorandum, "Available
Tools," lists the projects of

of

Advancement

Secondary

of

IBA, along with other or¬
ganized business groups and many

accepted by the New York Stock

Available

^

is to be published under the
spon¬

be

*

edition

Investment

Syndicate

this

y

of ^Investment

to

S.

Beaubien

The

office.

Textbook—Fundamentals of

complementary
sorship
under rather than
competitive.

course

source

Banking," the official IBA. text-'
by., their
respective
Groups
to
majoring in finance and book continues in use in both the
serve
as
Governors of. the Asso¬
particularly graduate students., classroom 'and
correspondence ciation
beginning on Nov. 29, 1956:
The
planned publication is not courses offered by the IBA and is
designed to develop a textbook also used as a
California
college text through- '
to replace "Fundamentals of In¬
out the country. Well over
Dennis H. McCarthy, The First
$4,000
vestment Banking." It would be
has
been -received
in
royalties Boston Corporation, San Fran¬
helpful, however, for use in prep¬ from the publisher of the text.
cisco.
aration of the expected revision
Central States
A
of

Andrew

V

students

Attention is again called to the
fact

also

would

three

for

to

During the 12 months ending Oct.
the defendant firms, is not only
19, 1956, there were 221 enroll-;
unwieldy but not readily access¬
ees, which compares with 208 in;
ti*e* preceding 12 months.
Many
IBA members make repeated use

these

in

Canadian

urged

are

appropriate; items

inclusion

campaign

has stimulated the demand for the

,

organizations have enrolled train¬

submit

to

Members

request.

upon

Salesmanship

findings of this study

be

~

-

9

9

Correspondence

■

to

Manual

of the statistical

summary

developed by legal counsel
by the research staff of the

defendant

the
attention of the younger men, who
are the
potential industry leaaers
brought

be

reports

a

data
and

61

(2557)

62

The Commercial and Financial Chronicle

(2558)

from

quickly at 50. Speculation has been
an important factor in the
growth

26

page

here in Hollywood,

and reading the
submitted
to

nity of hearing

information

t;ame

you.

entire

two

teachers

days

of

during

and

masse,

high school

told

economics

all

from

how

over

,

The younger groups

in San An¬
tonio, Kansas City, Toronto, Mon¬
treal, Boston, Chicago, Cleveland
elsewhere

imd

en

h

evidenced

a v e

the

rities

"brought into the world,"
they are selected, used and

United

States

secu¬

are

how

quoted, bought and sold—a work
which

only

can

£reat interest in what the IBA is

understanding

doing for them, and I have assured
them that at this convention, IBA

tals, and

would set

which

has

for too

radiate a better
the fundamen¬

long.

mailing facilities in
the hotel lobby for the use of their
•delegates, whereby you may in¬
up

the

struct

staff

IBA

to

send

se¬

ulative

of

tempering of the spec¬

a

attached to securities

aura

all

been

too

prevalent

fort

at

Rensselaer,

have seen

we

lected committee reports or all of

during 1956 the most concentrated

them to your young associates di¬

effort

rect from

made

No problem
of "over weight" on the plane

«ow

Hollywood.

of

the

people

fering investment education to the
public through broadcasting, tele¬
vision,
adult
education
classes,
movies, and advertising. This ac¬

reports from here direct

tion

nor

salesman's home.

With

to your
A memo will go

sent to

him at

your re¬

quest.
There is
that

is the

question in

no

this

"Accent

answer

to

a

my

mind

"Youth"

on

great

need

of

business, and that the personal
of every senior executive

our

effort

.should

directed

be

Whether it is

«md.

rnation

the

to

them

with

as

toward

getting infor-

boys,

or

what

to

that

advising

to

do

and

what policies to follow—it

is one
job that should not be delegated.
As

a

raises

man

children,

and

trains

to

tices of his

sales force.

own

!>ast

year

the

IBA

further

to

its

new

-

IBA.

has

During this
gone
all out

educational

in the business.

my

istration of this educational effort.
In

addition, we have had enthusi¬
astic cooperation from every side
the

financial

"Street"—Stock

Exchanges and Investment Bankcms

ing

alike—in advocating and sell¬

the

to

own¬

(2)

the

new

who

in those
them

lead

It is the highest level of

public relations

ever

attained

in

fundamentiils of

invest¬

ment.

Only last month
at
Itcnsselaer Polytechnic Institute at

Troy, N. Y.

whether

the IBA, NASD, the
"Clock Exchange s, the Mutual

speculation

turn,

advice

and

should

and

the

overtures

on

the

of the

many

business

our

young

throughout

the country,
I find that one of
their major problems in
acquiring
a new customer is the
proper han¬

which

we

all familiar.

are

have

I

asked

these

ability

boys—"Do

line

and

with

growth,

the

which

nationwide

is

in

adver¬

tising carried on by our financial
industry, or do you begin your

its

continued

success

on growth and try to de¬
velop the sale on a capital gains
appeal alone?" Another question:

"Do

you follow the concept that
should handle an account on

you

'roll

a

over'

basis?"

pointed out,

destroying
be

far

This, I have

lay the basis for
clientele. It would

can

your

better

to

develop

a

lesser

number overtime and you will be
less likely to run into seri¬
difficulties

ous

with

<

It

other

any

undertaking,

of

has

the

IBA

facilities

duty of management carefully to
supervise sales efforts so as to
keep newly acquired investor re¬

sales

lationships

on

in

and

sentations

,

t h

a

t

line with

and

investment
the

repre¬

assurances

publicity.

made

Certainly,

it

would be inconsistent to advertise

lecture along lines of "con¬

serving savings" — "building for
future"—"choosing the proper
kind of a securities firm," etc.—
and then permit sales techniques
the

to be

practiced which do not
to these representations.

have

the

to

the

Past

evolved

the

the

education

the

IBA

correspondence
at

of Business.

had

trebled,
ties

textbook,

course,

contention

my

who has

salesmen

greater lati¬

also

has

his

which

practices
to

long-term

a

relationship

with

the

men

sonal

the Wharton School

Whether these facili¬

been

is

or

are

education
still

direction

a
—

to
of

become
securi¬

established

that

of

many

the

around

men

the

country

desire

to

invest

but

ever,
or

organiza¬

have to rely upon their IBA

Stock

for

the

salesman

the

invest¬

by

"gross"

alone.

A

who'

man

renders investment service should

be compensated
in

success

properly, but real

this

business

is

meas¬

by the time clients have been i
list; the quality of his" ac- >

his

counts

and

reviewed

as

the

referrals

gets from

by

experts;

which

Exchange membership
training their men, and

*

rharU

a

satisfied clients.

The securities laws under which

requirement of
the

public

functioning in

our

interest.

for¬

to

educational

The

diversi¬

of

programs

our
are

rules, I wish to

truly conducted for that purpose,

paraphrase

I

and

them

so

agree

what

with

points.
what

that

those

me

Here

I

may

of

said

to

who

you

amplify these

the

is

have

have

of

summary

put before them:

Advice

Sales

to

those

basic principles
publicized.
A

People

This is the investment busi¬
The

ness.

vestment

basic

of

in¬
the

securities.

This

which

great deal

can

come

in

our

busi¬

men

in the business their

in

cooperation
fession of

ity and growth" equation—not the

making

ours

in

the

industry

organizations,

been

the

■••■i;_

way

respective

our

firms

In

and

professional

sincere thanks

than

that

so

which

them

has

in

been

such

real

(3)
in

recently

there

has

stock prices.

common

cumstances

readily

can

recommend

many

their

to

100%

is

still

should not be

a

principle

the

on

are

the

efforts
of

investment"

with

Association

still

"

who

have

and

IBA

outstanding.
They
efficiency in

of

sonally ..and

sure

at

are

ex¬

as we

all

you

...,

is

phases

of

This is my

them

collectively
this

and

operate- with

•

opportunity ' to' thank

quite, fre¬

who

so

been

Association work.

throughout

but

Group

associates.

has

assistance" they

investment

the
been

their

staff

quently in conflict with the think¬

talk

and;

*

also-thank

them

The

our

is

con¬

have gone into their areas to visit

so

"Fundamentals

'

they have made:

the

industry.
I

that

again.

membership I
thanks to the Na¬

great

Selling

hope

*

entire

Chairmen

attractive.

(4).

Coast

West

come

tremely cordial and helpful

that

many

good bonds and preferreds

the

on

will

.May

in

overlooked, particu¬

when yields

now

Septem-

behalf

on

addi¬

a

and-

meeting,*

structive

as

stock, whereas diversifi¬

common

larly

invest

v/as

you

Chairmen:

Governors'

wish to convey

salesmen have advised

clients

cation

In

It

me.

have

tional Committeemen for the

lead him

"dreamy deals"

to

to

Committee

we

For

A young

Gov¬

which"

the

at

they

almost unbroken advance

an

the

in California last

us

ber

man's self-confidence in such cir¬

to

with

and

Until

been

of

assistance

and

pleasure

National

adver¬

all

to

the

Committee

tising.

:

my

have:given to the Executive.

you

they

represented:

financial

for

ernors

obtain from their investments

that
to

advice

Appreciation

-

closing, I wish to extend

before.

case

.

Conveys Thanks and

more

of ad¬
vertising and public relations from

ever

pro¬

,

one.

p

dollar support

may

complete
this

highly respected

a

reverse.

Today, salesmen have

being

are

amplifying
the
foregoing
points, and getting from young

is

"security-income-marketabil¬

(2)

a

and

of good

the senior

men

of

salesmen

ness

"sold" with

be

must

distribution

the

principles

for

firms to carry out in practice the

from

(1)

establish

programs

"framework"

ing of inexperienced people who

for aid in

in

ment business cannot be measured

association and members firms

endeavoring

are

tion,

advertising are well administered.
A great many smaller
firms, how¬

their

(5) Many young salesmen speak
proudly of their gross.
Success

matters

opposed to investments.

Readily do I agree that a per¬
centage of the public wants to
speculate. Many will give'lip serv¬
still they want to buy at 5 and sell

"quacks"

fied

matter of per¬

sales

the

with whom I have discussed these

that process of

creating effective sales programs,
and
well
understood
policies
which will serve as guides for the
salesman, In larger firms, where
well

of

this industry operates refer to the

Realizing
young

become

or

the "shysters."

on

his clients.

properly

and

ured

fundamental

are

advise

counterpart

oppor¬

great

a

must

the

selling

tunity to develop through his own
self-discipline
the
investment

the

manual, the IBA movie, and

course

ties

of

administrations

tions exist, these policies and
pro¬
grams which are co-ordinated to

to

by

is

It

Investors must receive sincere and

Salesmen

come

ice

assumed

the conduct of

efforts

NASD

objective
provide diversified

for

salesmen.

up

pretty

own.

responsibility which

a

man

in

from

long been

however, there is a great respon¬
sibility which goes with such pub¬
lic education. In my view, it is a

to

a

our

the

the SEC.

Educating

or

that

left

the

„

Sales Practices

such

be

tude

often

to

though there is a responsi¬
the part of management,

themselves.

dozen

a

accounts than to work

new

their

have

on

must

has

assured.

Like

Even

bility

man¬

who

admitted

too

are

on

there is also

approach

and

makes

business

sales

men

mulate such basic

sell security, income, market¬

you

limited

recently

much

of this matter of investment

speculation; that overlapping,
debatable, contentious subject with
vs.

tive

is

of

facilities,

*

Talking with
in

a

much

sis

because

is

recommendations

certainly initially be

sound level.

men

follows

account

an

speculative

business, and that the empha¬
being laid on investment
principles rather than on specula¬
our

in

men

judgment, we have had
•outstanding leadership and admin¬

€f{

business

straight.

and

own

public

investors confidence

level

our

provide

this

in

work,
Vtoth.for the benefit of the public
In

of

(1)

in American concerns,

help

of

his

For many years education has
been another one of the major ac¬

of

base

that

see

to
the right
places—to
right kind of people—and in
the right proportions.
Regardless

so

Educational Efforts

tivities

the

undertaken

funds
needed for corporate expansion in
years ahead, (3) to dispel miscon¬
ceptions and fears, and to give

should he like¬
wise mold the thinking and prac¬
own

been

broaden

il^e shipment saying that it ership

?ras been

hut

has

as applied to
sales forces are ob¬

our

the

of¬

in

of some research man
at home "cornering" the report
for his files.
You may mail the

home,

of

being

decade

securities

by

past

the creation

confined

dling

Beyond the special combined ef¬

and in

markets, but

securities,
ligated to

thus providing Funds, and the Municipal experts
turned out

been

active

Raising Our Peiioimance Level
their members with the opportu¬

agerial

of America

Continued

Thursday, December 13,1956

.

.

.

have

per¬

for

the

given

me

to

as¬

well

or¬

and

year,

that there is

a

ganized and continuing operation
heart
"red-eyed
speculators." in
Washington which ^ effectivelySome young
men
may
think it serving us all.
■
■■
mm
better

to

take

the

line

of

least

This

resistance, and to make the Com¬

been

mission,

letting

ence.

what

wants," but like doctors

or

Dealers

he

lawyers,

one

the

in

novice

this

"do

the

business

year

a

I

of

IBA

highlight
am

in

experi¬

my

grateful to

privilege

has

activity

all for

you

of' having

served

-

you.

inB
UNDERWRITERS

.r

Municipal Bonds

it*

V

DISTRIBUTORS

BROKERS

••

Effective Distribution in' the Nation's
Third

...
.

Largest Trading Area

* >

ompany
THE

PHILADELPHIA NATIONAL BANK




Members:
New York Stock Exchange

•

American Stock Exchange

Philadelphia-Baltimore Stock Exchange

1401 Walnut

Street, Philadelphia 2, Pa.

*

LOcust 8-1SOO
*

-

/

New York Citv

Lebanon

Atlantic City

Vineland

_

Volume

5594

Number

184

.

The Commercial and Financial Chronicle

.

.

(2559)

Continued

from

the

47

page

filing of subsequent nuisance

suits.

We

made to
model

Report of IBA State
Legislation Committee
variable

in

annuity

of

plans

the

view

In

investors.

the

of

above,

be

approve

before

Commissioners

ance

the Na¬

Securities

of

this

also

be

tional

that

noted

Annuity

Association

which

fol¬

report

a

in

submitted

it

Na¬

the

in

conclusion

November,

1955:

Committee

of

is

the

opinion that if the sale of variable
is to be permitted, the
plans should be subject to the

annuities

Federal
vided

sale

We

of

the

for

of

that

laws

determination

that

investment

of

the problem.

IV

bill

A

Council

been

Stock

Ex¬

change, the Association of Stock
Exchange Firms and the National
Association of Securities Dealers,

Inc., in efforts to obtain adoption
of a model law designed to facili¬
tate
the
gift
ofi securities
to
The

minors.

has

law

model

ready been adopted, in some
minor

with

al¬

on

Ohio, Rhode Island, South Caro¬
lina, Wisconsin and Virginia).
bodied with
new

a

was

National

/

has

been

em¬

modifications in
state

this

Uniform

which

act

by

year

Conference
on

We urge
used

some

uniform

approved

sioners
-

law

the

Commis¬

of

State

Laws.

that the uniform act be

in efforts to obtain adoption

of this legislation in other states.

Legal Investment Laws

sey,

Mississippi, New

New York

and

Jer¬

Virginia

are

summarized in attached Appendix

A.

on

Stock

the

to

Chicago

this

receipts

Chicago.

City
year

3%

a

of

'

■

the

much

securities

Robert

city

brokers

originating

At hearings before

with

a

was vigorously
op¬
representatives of the
financial
community,
including
Mr. Robert Podesta, a member of
this Committee, who appeared as

the

of

Association

Stock

of

Firms. Action
been

deferred

it'^/
Model Laws

and

Chicago
Exchange

the proposal has

on

indefinitely.

work

individual

state

ments

lems

securities

of

Municipal

their

and

the

securities

respective

In this
tee

like

preciation
it

has

National
ties

Roy

of

received

Administrators

its

from

of

as

Arthur

The

bonds.

Municipal

Securities

Committee
has urged
adoption of two model laws pre¬

pared
of

the

One

of these

izes

the

IBA

groups

already

organized

definite programs for
the coming year. We urge that the
members of all group legislation
adoption
and

above

of

the

consideration to
various
model

uniform
in

this

laws

referred

in

report

their

or

laws

contemplated
mittee

contact

in

of the

any one

uniform

or

1.957

IBA

acts

the

model

laws
of

legal

companies

fective

Houseworth

Securities

Corpora¬

of the

investment

law

was

Louisianafor

•

•

other

The

open-end

in

or

securities

closed-end

municipal

a

in

solidated

bond
a

UNDERWRITERS AND

issue be

single
or

is

Com¬

Counsel

H.

Johnson

McDaniel Lewis

& Co.

Company
1940, which men of pru¬
dence, discretion and intelligence
acquire or retain for their own.

B.

Act

Lester

P.

Lester, Ryons & Co.
Los

account. The amendment provides
that no company shall invest more

Angeles

Chester A. Lucas

Stein
Donald

Bros.
A.

&

of

than

Boyce, Louisville

5%

Marshall, Seattle

MISSISSIPPI

;

L.

Mullaney

as

Ohio

adopted

in

Mississippi,

fiduciaries

prudent man rule, specifically in¬
cluding but not by way of limi¬

Mullaney, Wells & Company
Chicago

The

act

effective April 5, 1956, authorizes
to
invest
under
the

Stringfellow, Richmond

tation

investment in shares

terests

Dennis E. Murphy

and
so

Paul

in

common

Continued

Company, Columbus

trust
on

INCORPORATED

con¬

proceeding

r'

PHILADELPHIA

eliminating

Underwtiters,& Distributors
\

•

>

State, Municipal and Authority Bonds
TRADING DEPARTMENT

Equipment Trust Certificates
Public
Established

Utility, Railroad and Industrial Securities

1865

Philadelphia Bank Stocks

BlOREN
!

6•

Co

MEMBERS
New

York

Stock

Exchange

Stock Exchange
Philadelphia-Baltimore Stock Exchange
American

1508

Walnut Street

Philadelphia 2, Pa.

PEnnypacker 5-9400




120
New

Broadway

York

5, N. Y.

WHitehall 3-0590

NEW YORK

PITTSBURGH

assets in

Meyer

Foster &

Scott &

of its admitted

such securities.

Industrial, Public Utility, Railroad and Real Estate Securities

UNLISTED

any

the Federal Investment

Greensboro

STROUD & COMPANY

DEALERS

of

manage¬

type investment company or
investment trust registered under

law

litigation affecting the validity of

thereby minimizing

•

model

ef¬

Aug. 1, 1956, to authorize

investment

and

provides a bond validation pro¬
cedure designed to require that all

insur¬

amended

author¬

state

1956 to

legal investment laws which

An

adoption of

sum¬

amend¬

of

Section 22:844

Joseph J. Muldowney

We urge that in any state where
amendments
to
state
securities
model

the

and in

ment

legisla¬

have

1955

Association.

Bar

execution

H.

Marshall

acts

"

tion, Topeka

1957

state

contains
of

some

late

particular ; interest to the.
investment banking industry,
f; '

Houston

tures will be in regular session in
1957. Legislative Committees
of

laws

are

Republic Company-

Columbian

the

Legal

LOUISIANA

Carl

begin its work immediately
the Liaison Committee
Municipal Law Section of-

American

state

Fridley, Hess & Frederking

X

Forty-five of

State

Chicago

states.

Preparations for

to

appendix
of

ments in

ance

respective

Trus>

Investment Laws

maries

Wilbur E. Hess

problems under the securities acts

several

Haussermann

Hays

Central

of Kansas)
and Mr.
Reavley
(Secretary
of
of
Texas)
in
considering

by

the

II.

K.

&

APPENDIX A

Amendments

Finney, Jr.

Boston
Edde

Bank

Hayden, Miller & Co., Cleveland

Vance, Sanders & Company

Commission

their

National

Harper & Son & Co.

This

states.

This
Committee
attempts
to
cooperate closely with the Munic¬
ipal
Securities
Committee
in
legislative
matters
relating
to

P.

Bear, Stearns & Co., New York

organi¬

'

Elbridge S. Warner

the

Securi¬

an

/

Company, Pittsburgh

Co.

Seattle

Thomas

of

&

Ellsworth

Howard

Varnedoe

Savannah

Mellon

Noble

Sons, Inc.

William J. Wallace

Co., Atlanta

Delaney

Wm.

particularly Mr. Harry
(Director,
Securities
Division, State Corporation
Commission, Richmond, Virginia),
Mr.
Robert
Lammy
(Securities
Commissioner, State Corporation

State

F.

&

Theis &

Louis

Varnedoe, Chisholm & Co., Inc.

Co., Chicago

C. Courts

Sherman

ap¬

cooperation

Association

St.

Detroit

to express

the

Albert

Samuel L.

Smith, Hague,

states.

for

which

acts

Harry Theis

Sherrerd

Clarke

Courts

connection, the Commit¬

would

to

Bonds

municipal

Cleveland

Philadelphia

Malon

Shepard

Prescott, Shepard & Co., Inc.

Butcher

&

John W. Clarke &

proposed amend¬
administrative prob¬

under

Keen

John W.

be

can

W.

Butcher

meeting in discussing

Committees give

VIII

Regarding Execution

Validation

Robert O.

Company, Inc.

St. Paul
W.

administrators

by

Vice-Chairman

&

Podesta

Cruttenden, Podesta & Co.
Chicago

Z. Bronn

Kalman

administrators,;

constructive

done at this

proposal

posed

Robert A.

Beecroft, Cole & Co., Topeka

ad¬

Dinwiddie

transactions

subscribed.
year

Legal Investment Laws of

Louisiana,

The

subject of providing equity capital

state

Pierce

Dallas

municipal bonds by the use of
facsimile signatures if at least one
required
signature
is
manually

Important amendments this
to the

9-12.

Committee

C.

Rauscher, Pierce & Co., Inc.

Harry Beecroft

zation and
,

imposed

gross

14

(California, Colorado, Connecticut,
Georgia, Louisiana, Michigan,New
Jersey, New York, North Carolina,

model

of

cases

modifications, .in

states and the District of Columbia

The

clubs.

have

the

of

Charles

Granbery, Marache & Co.

Rockland,

September

on

Simmons, Chicago

New York

subcommittee of the City Council

cooperating

York

sugges¬

However, the

report.

proposed

stock

in

Gifts to Minors
has

ap¬

Transactions

(

on

New

from

the

the

Receipts Ta#

Gross

tax

IBA

of

than

VII

realistic approach to

the

Maine;

at

Equitable Securities Corporation

Chairman

for small business/Aside from the

may be helpful in
deter¬
mining the appropriate applicabil¬
ity
of
state
securities acts
to

would

The

Administrators

Osgood,

Gustave A. Alexisson

opportunity to establish a personal
acquaintance with the individual

report

Securities Administrators for their

with

the

securities."

Association

National

rather

act

tions in

the

of

at¬

as¬

plicability of a state securities act
depends upon the provisions of

those committees

commend

of that

registration under a state securi¬
ties act only if it meets certain
specified requirements. A copy of
that
report is attached as
Ap¬
pendix B, but it should be noted

pro¬

regulation

the

the

report at

a

and

now

are

investment

the

under

laws

securities

states'

the

regulation

degree of

same

submitted

ment club should be exempt

that

"The

and

dressed the meeting Sept. 10 on the

sociation suggesting that an invest¬

Securities

of

reached

Administrators

IBA

Committee

tended the annual meeting of the
Association of Securities

investment

last annual convention

should

the

of

the
the

Chairman

trators

Variable

the

Committee

lowing

it

connection,

for
of

Denver

Nashville

H.

Blunt Ellis &

National

Association of Securities Adminis¬

Administrators."
In

of

status

Gilbert

special committee of the National

Insur¬

and

Association

tional

of

Association

Counsel

Inc.,

Ralph Owen

LEGISLATION

COMMITTEE

of Securities

ixorpotn

Bosworth, Sullivan & Company,.

Respectfully submitted,
STATE

Association

Chairman

isern

adoption of these

clubs under state securities acts. A

such enabling legislation
exhaustive study
by the

National

the

to

as

(inopportune for any state to

have proposals in final form
prior to the legislative sessions.

Administrators

There has been much confusion

the committee feels that it would

to

be

laws.

National

Investment Clubs

of its

industry for the protection

obtain

efforts

IX

VI

safeguards imposed on the security

that

urge

63

ALLENTOWN

LANCASTER

SCRANTON

or

in¬

funds,

page

64

64

The Commercial and Financial
Chronicle

(2560)

Continued, jrom page

APPENDIX B

63

National

organization full member partici¬

Association of

Securities

Report of IBA State
Legislation Committee
securities

of

closed-end

open-end

any

guaranteed by the Dominion of
or any province thereof, if
not in default, was amended effec¬
tive April 11, 1956, to authorize
or

or

Canada

in¬
vestment company or investment
trust registered under the Fed¬
eral Investment Company Act of
1940
and
in
bonds,
preferred
stocks

management

national

a

securities

which

Canada

in

vestments

are

kinds,
classes and investment grades as
those eligible for investment under
substantially

exchange

SEC.

the

with

registered

and in¬

in "securities

investment

stocks listed on

common

or

type

the

of

same

this section."

An

Dec.

effective

act

authorizes

27,

Subdivision (4) of section 26-40

New

to

other

of

Virginia legal investment
law
for
fiduciaries, authorizing
investment in stocks, bonds, notes

invest,

law, in revenue bonds meeting
specified requirements, subject to

utility,

sueh

account

on

gations of
a

the

New

law

York

investment
companies,

legal

insurance

for

of

8

requirements,
effective

amended
to

raise

of

investment

from
assets

of

as

the

1/ 10th

law

was

insurance

preceding

a

amount

31,

the

New

law

York

previously

vestment of
of

new

amended

was

invest

to

under

way

of limita¬

tion authorization to invest in

obligations

preferred
rities of
end

in¬

and

cor¬

stocks,

and

common,

or

secu¬

open-end or closed-

any

management type investment

investment

or

company

in evidences

the

rule, specifically in¬

man

porate

authorized

investment

section 26-45.1 to authorize

companies,

reserves

indebtedness

fiduciaries

for

investment

legal

district in

or

legal

cluding but not by

to

of section 8 of

insurance

for

which

Virginia

prudent

J/sth of 1% of such assets.
Subdivision 8(a)

town

trust

In

last

the

registered under the Federal In¬
vestment

assumed,

Company Act of 1940.

-

DISTRIBUTORS

-

DEALERS

invest¬

years

gained great pop¬
It is estimated that tnere

ularity.
are

in

now

than

more

operation with

100,000
clubs

is

from

source

formed

The

they

which

of

in

these

provide
and

new

customers

over

securities

interested

because

clubs

10,000
total

a

members.

industry

be

can

a

in¬

1,600 clubs

members

are

tion

in

as

Detroit in

dent,

George
pioneered the

1951.

A.

Its Presi¬

Nicholson,

formation

of

Jr.
such

clubs.

They have material for the
formation
of
clubs
including
agreement
forms,
by-laws,
ac¬
counting,
reporting,
and
stock
analysis forms and issue monthly
letters

news

charge

to

fees

ships,

members

for

forms,

their

services.

and

material

is part of the
New
York
Stock

the

distributes

its

to

and

member¬

This

tions

with

memberships

transferable
vote

one

per

to

and

non¬

limited

to

15,

member, unanimous

admit

members,
monthly meetings, majority votes
on
investments, no margin ac¬
new

counts, no pledging of assets, and
a 10 year term.
Members may in¬
vest variable amounts

ited

with

units

being cred¬

valued

periodi¬
withdraw
receiving the proportionate value

cally.
of

A member

his

may

investments

(assets

are

sold,

if necessary, and commis¬
sions charged him) less 1% pen¬
alty.
A
scrutiny of the state secu¬
rities laws would

indicate gener¬

ally that the investments of
bers

in

(whether

club

or

not)

most

within

state
secu¬

investment club (even

though it is evidenced only by an
accounting
entry)
urhght
take
place in the following situations:

members.

MASTER CO.

(3) Reinvestment of income and
capital gains.
(4) Acquisition of a new mem¬
ber.

FIRST NATIONAL BANK

BUILDING, PITTSBURGH 22, PA.

Telephone COurt 1-7300

Teletype

MEMBERS:
New York Stock
American Stock

PG

566

BRANCHES:

Exchange

Butler, Pa.

Pittsburgh Stock Exchange

Johnstown, Pa.

Wheeling Stock Exchange

which of the

uations the sale of

An effort

exemptions
to

was

existed

securities
do

seven

Clark, Dodge & Co., Netc York City

to

sit¬

not

curities

of

what

state

in

see

laws

unincorporated
Of the 48 states,

seem

to

require

registration.

to be

pear

a

made to

investment clubs.

Private If ire

above

security un¬
der a state law takes
place is a
difficult question.

as

one

shall

be

disclosure

to

the

Some requirements
disclosures might also be

up

to existing

as

(4)

The

There

ap¬

express

(5)

employee.

Securities

bought

KAY, RICHARDS & CO.
Street Floor

Union
PITTSBURGH

Tru»t

Bldg.

small group of people sim¬

a

ply join together to buy securities,
a court
might hesitate to say that
such a joint venture came within
the purview of a blue sky law.

believe, however, that it is en¬
tirely proper for a state blue sky
law to lay down certain ground

PENNA.

rules

PARTNERS

to

make

that

shall

N.

C. Ray

in

H.

J.

E.

Williams

F.

E.

Criit

fied, and to provide a reasonable
amount of scrutiny or regulation
if they stray beyond.
A purpose
of this report is to define the lim¬

S.

Parker

Wm. C.

Baird
R.

B. Parker

(Ltd.)

its

BRANCH
Erie

Uniontown

Warren

correct

New

Wa.hington,

Clarksburg, W.

Castle

Pa.

are

exist

Our
MEMBERS
New

York

Stock

Exchange




Pittsburgh

American
Stock

that
Stock

Exchange

Exchange

(Assoc.)

be

seeks

and

Investment

to

not

abuses

not

well

our

be

to

It

N.

thus

far

investment

J.

be

Kiraly,

Vice-Chairman

Robert Lammy
Kansas

Mosby

Missouri

Thomas

Florida

39

page

Report of IBA Public
Utilities Securities Committee
of

individuals.

rely

on

be

have

we

of

enough

of a
opinion

investor

firm ground in our

on

to

observations but

have

we

cross-section
to

Here

our own

believe

we

con¬

clusions.
We

consistent

continuing. Rather,
to change with
variations in many unrelated fac¬
tors and a course being generally
pursued today may be altered or
they

nor

subject

are

abandoned tomorrow.

increasingly find

investors

Furthermore, many institutions
expressing the desire to buy com¬ which formerly bought only or
mon stocks which offer
possibili¬ mainly senior securities have been
ties of capital gain and evidencing
large buyers of common stocks in
less

interest

in

Two factors in
for this.

tors

income.

current

particular account

In the first place,

influenced

are

inves¬

the

by

fact

that the Federal income tax struc¬
ture permits them to retain
ger

than

big¬

a

percentage of capital gains
of dividend income.
In the

second

recent years.

In building common

stock portfolios, some of these

should

following

re¬

shall

be

members.

limited

(In

a

to

not

larger

new

buyers have been attracted by the
more conservative types of
stocks,
utilities among them. As these in¬
stitutions become more experi¬
enced with

handling

portfolios

it

place, there is a wider ap¬
preciation of the fact that over a

that

period

is

common

stock

entirely possible
will become more

of

of

the

years

purchasing

of the dollar has

been

Accordingly,

insist

stocks which

on

investors

many

promise

an

increase in value at least sufficient
to offset the attrition

of inflation.

A

straight income-producing in¬
vestment has less appeal than it
had only a few years aeo.
Many
investors

stocks

against

shy

feel

fail

that

to

public

offer

utility

protection

inflationary

trends

from them.

away

individual

show

utility

least

at

and

There is in¬

companies

modest

to

increase

time.

Stocks

records in

this

which

regard

have

good

gener¬

are,

ally speaking, faring better in the
market

tions

than

are

those

whose

opera¬

characterized by

stabil¬

ity and whose earnings and divi¬
dends

have

remained

relatively

static.

why worry

vate

investor

the slack is
stitutions.
grams

of

about

loss of pri¬

interest

long

so

being taken

up

are

you

situations

considering,
attention

problem

but

to

to

the

as we see

broad

it.

general

We feel that

the

raise successfully the hundreds

of

millions of

utility companies

stock

money

programs

ahead,
on

will

We

of

see

that the commis¬

the picture, as we see

investor

insistence

prospective increases
dividends.

regulatory
tive

to

We

in

authorities

the need

of

it,
on

earnings

believe
are

that

sensi¬

granting rates

high enough to attract
tal

years

consideration

required.

eager

greater

and

common

of regulatory authori¬

be

are

sions

in

construction

will require in the

sympathetic

the part

ties

dollars

which

going

are

new

capi¬

successfully. We sincerely hope
trends

describe

we

will

given adequate attention in

be

your

deliberations.

Very truly
HAROLD

H.

yours,

YOUNG,

Chairman, Public Utilities Securi¬
ties

Committee, IBA.

THOMAS & COMPANY
BUILDING

PITTSBURGH

-

your

to

not

ALCOA

now

are

attract

if

as

pro¬

the

and

you

specific

by in¬

Unfortunately, the
the institutions

writing

are

not about any

the

The question might be raised as
to

We

other commissions,

in

earnings and dividends from time
to

interested in the capital gain type
investment.

de¬

teriorating and the trend contin¬

they, too,

19,

PA.

Municipal and Corporate

indicates

club

Com¬

Ohio

dog¬

quirements;
20

this

Chairman

may

conclusions.

if it meets with the

(1)

F. Hueni,

Jerry

jrom

of

Respectfully submitted,
John

known; there¬

intend

as

exempt from registration only

over

conclusions

mittee should not be reached until
further study is made.

change.

clubs

such

study

an

Regulation

area.

follows

do not

in

The above enumerated steps are
as
a
minimum.
The

bers shall be required for
any ma¬

Continued

all times.

regarded
final

Joseph

jor investment policy

the inspection

to

open

not justi¬

is

and

are

we

matic

an

abuses.

new

fore

Va.

regulation

such

generally

OFFICES

Meadville

of

be

members at

an area

N. K. Parker

which

(8)
should
of

serv¬

operation of the club.
The
books
of
the
club

invest¬

within

sure

ment clubs operate

the

margin, nor any money
be borrowed, nor assets
pledged.
(6) Unanimous consent of mem¬

We

30,

in

on

uations.
If

ices

receive

remuneration for

Michigan

se¬

exemptions
in a clear
majority of the other
states covering the above four sit¬
no

or

clubs.

management of funds
in the hands of a li¬

his

or

member should

fee

be

not

censee

No

(7)
any

member.)

creasing scrutiny of the ability of

Just in

Wheeling, W. Va.

Exchange (Associate)

set

ues.

The issuance of

an

as

might

Thursday, December 13, 1956

.

agency.

such

power

incorporated

securities

definitions.

mem¬

investment

an

Original formation of club.
(2)
Periodic
investments
by

Established 1891

there
state
of

It

contemplates
the
formation
of
clubs as unincorporated associa¬

joint venture ele¬

Periodic contributions gen¬

Exchange

(1)

A.E.

(2)

kit; which

members.

the

erally should be equal.
(3) If a licensee or his employee
is
an
organizer
or
a
member,

of the National Association of In¬

Clubs,
which
was
a non-profit
organiza¬

of

A husband and wife

counted

shall

About

to

greater

some

be

ob¬

tained.

rities of

UNDERWRITERS

few

ment clubs have

are

issued,

is

ments.

consent

fiduciaries

company

Dec.

obliga¬

direct legal

effective June 29, 1956, by adding

admitted

of

such

the

either

city,

The

securities

such

1%

of

the

of
the

in

other

question."

April 11, 1956,

permissible

"are

county,

authorizing investment of reserves
in
common
stock meeting
pre¬
scribed

or

obligations of, or those uncondi¬
tionally guaranteed as to payment
of principal and interest by, the

YORK

section

that

requirement

tions

of

"authority

any

obli¬

such

public body" and (2) to eliminate

vestment.

13

in

investment

thorize

issued, shall have been in
operation (whether or not owned
by the issuer of the bonds) for at
least five years prior to the in¬

NEW

in

Virginia upon which
there is no default, was amended
effective June 29, 1956, (1) to au¬

been

Subdivision

indebted¬

of

county, city, town or

any

district

have

shall

bonds

revenue

of

ness

which

of

other evidences

and

specified limitations as to amount.
One of the requirements is that
the

the

tends

disappear, and
delegation
of
rights and responsibility, and loss
of

Committee

founded

VIRGINIA

1955,

Jersey
savings
in addition to
investments authorized by

banks

Report of Investment Club

vestment

NEW JERSEY

pation

there

Administrators

.

.

Securities

Volume

184

Number

5594

.

.

The Commercial and Financial Chronicle

.

(2561)

Continued from page 25

indicate

to

zon

turn

in

Rather at

The Threshold oi 1957

into

the

availability

of

credit

tain

economic

not

permit
that

yond

stances

to

stability

misuse

point.

with

that

required to mainand

of

In

the

which

thus

credit

it

be-

circum-

has

been

confronted, the Board has done

nomic

society

there

responsibility
participation
both
we

to

local

bankers

as

function

to

for

in

better

are

and

Commission

Perhaps with the tools available
at

prosperity.
conduct
us

shape

public opinion than so
others who for so long have
of bur national

articulate

than

loose-

exuberance

-

that

human

Let
of

approach in

our

own

affairs,

the exercise of

encourage

ests of preserving the integrity of
the

committees

dollar

have made outstanding contribu-

and

in

order

long-range

assure

Let

progress.

better

to

sound economic

vigorously

us

op-

tions in this direction. In the field pose and speak out against
of Public relations, the Invest-In- sound economic practices

changes that have taken place in
our
financial institutions during
the past generation it is
appropriate to inquire whether the credit

ened and made more effective Let us as investment bankers inwita the result that our story dependency and through this as¬
increasingly is getting before the sociation utilize more fully the

control

mechanism

The growth of

is

public.

gram

loan

associations,

as

trusts,

and

investment
concentrated

The

IBA-Wharton

has

be

to

come

short

and

in

course

and

available to

and

un¬

both

government,

techniques

within the in¬

us

them

apply

to

.

^

the

.

.
Qualified to function,

ac-

This brings

invest-

(Special to The Financial Chronicle)^

LOS
R.

Formation of the International Fi-

ANGELES, Calif.—Vernom

Herring

Charles

and

A. Lan-

ning have been added to the staff!

Marache>

of

™

Dofflemyre

Co.,

&

~

should help immeasurably in
couraging
ranital

the

It

flow

of

nrovid^

634

en-

th^

ha«ic

South

bers

American

Spring

the

of

Exchange.

Street,

Los

mem¬

Angeles

Mr. Herring

Stock

was

for¬

fnr

merly with First California Com¬

.

bankers to enter

uS as invesen

pany.

the foreign field with highly
skilled
At

a

and

experienced partners.

later date I will have

about

say

creasing

the

the

more

possibilities
flow

of

Shearson, Hammill Addis

to

(Special to The Financial Chronicle)

in¬

of

LOS

American

Calif.—Milton

ANGELES,

capital abroad but for the moment

C.

I would like to suggest to you-that

John E,

Shlaudeman

while

C.

have

have not lived up to

we

that

shaPing of public opinion in those
^
^e„ are uni(fue^y

pro-

recognized

the most authoritative

credited

skills

dustry

School

outside

and

great

^ ■"

Educational Programs

com¬

panies, private and public pension
funds, savings banks, savings and
other

.--!V

are

adequate.

insurance

our

within

program has been broad-

Two With Marache Co.

foreign

vestment but this

caution and restraint in the inter-

we.

more

fully the
private insubject has just
been quite adequately covered
by
my former colleague, Bob Garner,
for

ap-

its disposal too much is
being
asked of the Federal Reserve
Systern.
At
least
with
the
vast

America

intended to discuss

prospects

VfaVCen- is a salutaiT development that

us,

conservative

courage

the

more

of

error

characterized

Let

Some

Study

over

qualified

been

Aldrich

carefully avoid falling

equipped

better

run.

proach to problems in past periods
of

which

many

a

creditable job.

have

affairs

public

national

a

active

more

in

and

also

goes

down-

juncture I believe

common

and

ness

amount which is

this

should

we

serious

a

business in the short

responsibilities
ther

have

we

tunities that
exciting

in

this

field

grasped the

are

our

nei-

oppor-

available in this

William

Erman,

Zane

with

and

become

Shearson,

Haskell.

H.

Waldo

connected

Hammill

&

C04.

520 South Grand Avenue.

Mr.

Haskell

formerly with Wal-

was

ston & Co.

area,

to my final point

me

reservoirs of funds deserve exam¬
ination.
Actually
the
financial

ment

banking. Last fall's session
designed to inform educa-

—the responsibility of the invest-

at RPI

nient

mechanism has not been subjected
to
exhaustive
study
since
the

tors about the practicalities
of
investment banking was an outstanding
success.
Much
more

American business management
^as been too preoccupied domestically in the postwar period to
take an active role in business
abroad. By and large the same has
been true of the investment bank-

_

„

Aldrich

Commission

completed
been

of

of

a

that

monetary

nature

to

comprehensive study
to

1908-1912

work, and
suggested by others,

lishment
sion

of

its

be

has

should be done in these fields of

estab-

education and public relations so
that we can disseminate more
effectively an objective presentation of the securities and invest-

as

commis-

conduct

would

a

seem

timely.

ment

With the current Hmitea

banking industry

on

in

world

affairs.

Rambo, Close & Kerner
Incorporated

community. In the absence,
however, of a satisfactory flow of
inS

^riY

more

a

bankers

.

American capital

.

Corporate Bonds and Stocks

and in-

avaii-

Municipal Bonds

ability

of bank credit, with the
approval of the voters earlier this

quick, fly-by-night operators that

month of

have

$2 trillion of public

over

financing

tLLtt
ment

and with the Dostoone-

?§• dna.wun
of

postpone-

financings during the past

several

months

condition

of

because

the

of

market,
stagger-

money

there has been built
up a

ing backlog.
mendous

handle

To

volume

will

the

this

tax

tre-

to

the

been

such

business.
ana

a

Peddlers

ifivino

arp

a

to

scourge

Fortunately

NAcn

and

associations and
have

trade

Warily

also economically:
many iinrtpntpvoinnod
manv underdeveloped
underdeveloped

and

...

..

wlthoul lfthat
countries

evitably would
to

free

are

today

1518 Locust

St., Philadelphia 2, Pa.

in¬

have fallen victim

communism.

member

our

great

a

pro-

other

of

had

program has ac-

£°mplished a great deal both mil-

SEC
stork

aie giving penny stock
hard time, and the

this

of

grams

Authority Bonds

*n many lespects

gaP-

e

our

the

npnnv

advertising and educational
firms

^

deal

to

Private

International

the
resourcefulness,
in¬
genuity, and personnel of the in¬
vestment banking business.
vesuneiH
oanKing ousiness.
it
It is

do with

for

suggesting that this organization out foreign aid program falls short
I' oil
ifo

fullest

these

...

and

reasons

_

.

_

during this
O

_

critical period

that

ment

can

bankers

we

invest¬

as

make

standing contribution to
stability.

out¬

an

economic

hastening their demise.
taking a broader participa¬

In

tion
.--v

in

national
JI

in

other

selled

to

add

financings
inflationary

to

Those projects

sures.

postponed

to

that

period

a

be

economic6 decUnF C"ShWonir?g ?ny
lit question
a

be

insure

weighed

with the

these

of

to

proper

for

even

high level of stock prices
getting out of line in

instances.

But

it

vital

to

seems

investment

that

me

we

as

bankers, playing such

role

as

but

2

-

not

am
«■»

«««-

in

do

I

or

in

ments

serious

that

committee

have

ouicklv

the

chairmen

and I have had assurance from the
]eadors of our industry that they
sjbie

provide

specialized

every

us

way

pos-

with whatever

personnel

may

be

re-

quired

to
deal
comprehensively
objectively with any soecific

and

problem

of

this

nature.

that has been made dur-

progress

ing recent

warT«n1et0d\stdrib^„a!?ndand ^
*5" trading
writing, distributing

My ?Urp°Se ea,'"er fa citi"« the
potential weaknesses in the

of securities.
with

this

viding

the

It

seems

to

responsibility
lifeblood

of

me

that

five

this
the

examination

be

econ-

0my

was

not

for

pro-

spreading alarm.

eco-

fact there

is

nothing

for

it

is

CORPORATE

only

ELLWOOD

in

S.

ROBINSON

AND

LAWRENCE

B.

1LLOWAY

Penington, Colket & Co.
"

ESTABLISHED

By substituting private for pub¬
lic
participation the encourage¬
ment of nationalism
can

be eliminated.

New

York

American

incentives

recommended

the

by

Stock

Philadelphia-Baltimore

other

and

1896

Members

and socialism

Tax

Stock

Midwest

President would go a long way toward stimulating an increasing
flow of private funds. -

Stock

Exchange

Exchange
Exchange
Exchange

123 Sonlli li road Slreet.

PEnnypacker

Stock

Philadelphia 9. Pa.

5-7700

Teletype

Some of the agricultural surplus

disposal plan funds have been
...

„

,

clflcally

,

earmarked
If

junior
in
on

this

Manhasset

way,

a

to

PH

180

Williamsport

be

nrivate

re-

Call JANNEY, DULLES

for—

vwtor.

judgment,

through

Reading

basis is

Theie 1S n0 better way' ln my
than

Altoona

private
can

purees.are more apt to be enticed,
_A

York

,

for

capital

which

New
spe-

of

the hori-

BONDS

Managers, Bond Department

receiving

of

on

BONDS

basis

matter

a

MUNICIPAL BONDS

REVENUE AND AUTHORITY

foreign

sound

a

MARKET

exhaus-

purpose

the
As

GENERAL

aid.

government

nrovided

Wants Conservative Approach

on

devised,

furnished

for

the

Distributors

and

PENNSYLVANIA MUNICIPAL BONDS

the

way
that the advantages of
private enterprise system can

usage.

years.

our

an

of

for

j3.e brought tangibly to the atten¬
tion
of countries
now

Beyond

that I urge you at the group level
to continue
the uuC CUuLalJWiai
fine educational

do, have a responsibility that extends considerably beyond the furnishing of
we

commission

a

private channels

develop-

are

bro«Sht 10 ' the attention of

cooperate in

appointed

the

Wash¬

should

we

For that very

fact, the President has

in

reason,

can

in

follows

These

of all its objectives.

Underwriters

secret that

our

affect

staff

no

ltrrtf*

aid program. It is to be hoped that
a
constructive plan for utilizing

and

system.

which

Nevertheless, it is
;

purpose of conducting

up

out

speak

fact that affect

closely
in

interest

to

4~.

A

which

rather
a

-L

U 1

__

legislative

011

competent

ington

are

some

a

carefully

ratios

J!

have

problems

Our

in?inC11]g

maintenance

debt-to-equity

heard

appropriate

,

iho

counted

business

lower

nri^n? 'nH
chni?iH

t

but

we

free capitalistic

that
pres¬

can

of

be

other

coun¬

avoid

be

and

pros¬

pective borrowers should be
would

^

responsibility not only to stand

Handling Coming Financings
and

that

I
*

fields

inexpert

are

suggest
and

Corporations

if.'

in

propagandize

we

affairs
««««*

2

Financing

fight

Bank and Insurance Stocks

communism

capitalism.

I

had

active

Pennsylvania Tax Free

trading
markets

Industrials

Utilities

Distributors, Dealers, Underwriters
Common and Preferred Shares

Corporate & Municipal Issues

City-County-State-Authority Issues
Direct

DeHaven

&

Townsend, Crouter
.

ESTABLISHED

&

Bodine

1874

New York

WOrth
MEMBERS
NEW

YORK

STOCK

EXCHANGE
_

Bell

AMERICAN

PHILADELPHIA-BALTIMORE STOCK

STOCK

EXCHANGE

EXCHANGE

NEW YORK




CHESTNUT

STREET

PH

Philadelphia

WILKES-BARRE, PA.

PHILADELPHIA

4-2140

System

80

Telephone
8-3400

JANNEY, DULLES & CO, INC.
Members

New

York

Stock Exchange

Philadelphia-Baltimore
1401

Walnut

Street,

Stock

^

Exchange

Philadelphia

2

2

STAMFORD, CONN.
T

Telephone

Teletype

LOcust

1500

Trading Wire to A. M. Kidder & Co., New York

Since 1903—Underwriters, Distributors, Dealers,

Brokera?

/
66

(2562)

'

'

Continued

from

33

page

ties in

*

these

This is

areas.

a

In

Public Woiks Needs of America
vigor..

if

Nevertheless

1955 construction rate

tunately

the

struction

is increasing.

increase

of

Fund

con¬

we

might take

some

constitutes

now

the

of

edge off
critical

a

national problem.

The situation
in
highways is
equally well known by the gen¬
eral public. It is not so well ap¬
preciated that obsolete roads are
costing the United States needless

★ ★ ★ ★

•Vtriftf

invest

m

in

•

portfolio

•f diversified

of

waste

lives

vbkh

beads,

Im>

may

preferred
stocks

eemmon

dollars.

and

The

serurv

of the

enactment
•its

1956

pre

partitas

for

their

laceme

and

(Mtieo

this

iri

possibilities.

76%

System

appre

alone.
three

over

result

fewer deaths
that

on

that

And

41,000 miles out of
of

will

accidents

fewer

new

with its limited

characteristics
estimated 72%

an

and

The

waste.

Interstate System
access

varying

Highway Act of
itself directly to

addressed

eliminating

e#
se¬

lected ia

is

only

national total

a

million

miles

of

Copies of Fact Book (Prospectus)

highways, roads, and streets. The

available

Automobile

on

request from the

undersigned.

ciation

Manufacturers'

has

estimated

Asso¬

that

the

Interstate

DELAWARE

Perm

3

DISTRIBUTORS,

Center

•

Phila.

Inc.

2,

Pa.

System may save $2.1
annually in savings in fuel
and tires, in accident losses, and in
billion

commercial vehicle time.
The Federal Highway Adminis¬

trator,
the
Bureau
of
Public
Roads, and the State Highway
Departments are working at top
speed to get the tremendous high¬

rolling. Projects on
the Interstate System authorized
since July 1, 1956, total $2 billion
528
million.
Thirty-one
States
program

way

have

been

bids

on

July

1.

get

Interstate

bit

is

may

the

during
the

pro¬

you,-

I

that

a

magnitude cannbt

burst into full bloom

immediately.

Growing Water Scarcity

SECURITIES, INC.
As

Incorporated 1933

all

this

nation

other

grows,

civilizations,

with

as

is in¬
delibly linked to and dependent
upon the availability of water—a

THE COMMON

it

primary, essential element
and

STOCK FUND

for

for

life

of

Water is required
only human existence and

progress.

not

production

of

food

billion

20

amount

is estimated

years

gallons

equal

day

per

to

at

or

'

further

areas

we

problem~t)f

overlapping

Consider for

political
central
cities

tue

to

and

sub-

On

1955

By

grew

to:.

state-local

a

debts

$200, for

about

each.

debt
the

and

billion.

basis, the

mo-

a

normal

Federal

the

and

were

billion

$19.5

the

$39

Federal

debts

billion

$275

tue

nave

ment

of

.-."1955,

enough, in

jurisdictions.

an

supply

the

not

were

the

capita
$1,660

per
were

Federal and

state-"

local

respectively. Since the value
1955* dollar is only about
statistics, grim enough in them¬ their suburbs
counties, towns,-one-half that of 1932,'state-local
selves, do not reflect the alarming. and
townships—all within a comdebt, in terms of constant dollars,
nature of the
shortages currently iiion c o iii in u n i t y. Tiieir
raws,- is about the same now as it was 25
being experienced in some areas-;
taxes, and fiscaf capacities can
years ago, while the Federal debt
of the
country which are not as aiiu
frequently d<* diner widely.,
is six and one-half times as great
fortunate as others. In
many areas
Supeiimposed
:on
these
are
as it was- Of course, it is realized
demands
are
increasing
more,
many special purpose authorities that state and local sources of
revrapidlly than the supplies that can or commissions
which may follow
enue
are
reduced when Federal
be provided.
Today, one out of
arbitrary or physical features ani- demands become as great as
they
every eight cities faces a water.
span the political boundaries. For
have.
'
shortage. In the state of Texas,
example,; there
are
roaus
andi > -The Investment Bankers
of
v while
the
population- increased
streets,
including ; tunnels
and America
are
1.30% from
contributing in ra
1890 to
1950, water bridges. These must be area
wide., significant
way to the healthy arid
consumption in the same period
Next, we might have an intergov- sound
increased an
development of municipal
astounding 13,500%!
ernmental
transit
authority op- credit.
- ;:
^
>
It was
truly said by the Presi¬
erating bus lines., and subways..
dent of the United States
We are aware of the role
120

New

York

cities.

These

divisions

of

and

of

the

Companies

produce energy and for practically

manufacturing process. Per¬
haps in no phase of public works
is
long-range planning a more

every

★
~

THE CAPITAL

basic

requisite

velopment

GROWTH FUND

able

of

water

than

in

adequate
supplies.

the

de¬

It

suit¬

is

no

a simple matter of merely
going out to a water course and
staking out a claim or drilling of a

THE FULLY

well.

ADMINISTERED FUND

We

still

•

and

tion,
has

BOND FUND

our

it

★

at

in¬

are

the

our

growing popula¬

capita

tripled

use

in

of

the

water

last

55

It is estimated that by 1975
four times

turn

increase

THE GENERAL

per

will be

.

that

in

of

the

use

of

what it

century.
water

Divide
ill

to

the

is not
therefore

must

we

every

store

and

plan

virtually

to

the

to clean up our rivers,
develop economic means of re¬
fining sea water, or face inevi¬
table water
shortages.
Not only are we
stepping up
not

lem

we

be

be

water.

lty.

considered

streams

and

rivers

downstream

needed
waste

the

of

use

denies

water.

treatment

is

stream, water

re-use

downstream.

You

prised

the

at

If

is

The
ments

be

large

I

the

on

cSordinated plan-

of

Council
has

states

thority

for

units

sur¬

with

requirement

Govern¬

that

would

au-

metropolitan
provide

capacity

for
treating
Treatment at
17,200 locations is

the

remaining

either inadequate
In

the

mand,

face

of

or

the

works

and

tribution of
The ranid

the

other
been

by
our

the

the

States

has

a
postwar phenomenon
which has drawn the attention of

sociologists,
dents

of

government

bankers

and

and

and

engineers.

increased

sizable

a

11.8

areas

173

now

contain

population

It
of

of the land

area.

borrowing

in

a

(4)

our

widely.

the

that,

growth in cities

in

public

con¬

a

tinuing expansion of public facili¬

I

am

the

ex-

debts

jn

of

healthy

such

sound

efforts

and

0f

each

these

areas

as-

self-

in

on

your

governments.

Explains

With

this

Fixing Public
'

background

of

the

s|ze, diversity, and complexity of
pukijc works needs and the probiems 0£ financing them, I would
iike

to
now
explain briefly la
rational and practical method by

which

level

determine
needs

and

of

its

government

public

works

program

president's purpose
.

this

of strengthenplanning.
It is

forward

the

timely

a

are

investment suggestion
BEFORE

DECIDING

varies

get the booklet-prospectus and
record

their

Method

Works Scope

use

revenues

not

local

state

lb® financial health of state

persuaded however,

are

by

encouragement

of

retain

greater

resources

main,

the

en-

financial

wealth of experience can contrib-

The capability of vari¬
levels of government to carry
out public works program in
light
fiscal

sound

of

analysis of economic potential
a
long-range basis,

decreased.

their

delimita-

uneconomic

properly to
mee£ them. This system has been
larger
.devei0ped
in
response
to
the
cur-

capacity

in those times when

or

practices
officials;

times

from

would

for

as

and
ana

the positive and active

sistance

ous

of

J*le Powers

and local

rev-

works

come

This

government

Only 3% of

a

public

the

local

Yet,

in

by

between

that

us

revenue

of

revenues.

of

and their suburbs demands

This

abundant

7%

The

areas.

(3)

,

proper man-

balance

logical to

rent

mil^on

rural

of

penditures should

Spates

five-year growth has been

the

is

proportion

as

57%

seems

only

on

.

borrowing.

standard metropolitan

which

total

_

expenditures^ from current
enues and
those from

of this increase has occurred

the

elements

agement

Between

growth.

,

only

the

of

stu¬

well

as

1955, the United

population
persons,

our

economists,

.

so

uni^s °t local government;

From

pr°Der financial management. °ne

dis-.

of metropolitan

United

_

limits

(2) the elimination

^lon °*

impact

point of view, balanced public
works expenditures can be maintamed at a stable level

population growth.

growth

in

,

our

public

been

97%

.

further

unequal

the

once

debt

course,

effective capital expansion.

increasing de¬

have

needs

romr>i''cat°H

recognize at

only

}°CaTToternmen^Pf alt h
o a
g°vernmems
taitn

of sound financial
management on

non-existent.

re-use of water is essential.

These

1950

will

of

talerits

credit;

and local

bankers,

special

also' sertfe

can

I will mention

*

couragement
the- management

Investment

their water wastes.

find

The easing of statutory and

authority and flexibility

functioning; (b)
for adequate waste
treatment. The
ability to finance themselves, and
United States Public Health Serv¬
(c) an organiration responsible to
ice
reports
that
less
than
one-and deriving its operating authorfourth of potential sources of
pol¬ ity from the
people of the entire
lution now have
adequate treat¬ area
concerned. We stronelv enment. Specifically there are
12,000 dorse this
key recomendation of
municipal ani 10,000 industrial
the Council.
sources of
pollution today. Out of
this 22,000 total,
Constant Dollar Per Capita Debt
only 4,400 have
adequate

(1)

them

for adequate

As-

an

few:

constitutional

the

legal

establish

general

which

(a)

State

recomended

various

up¬

of

as

the

special

you

local officials.
a

which

an-]

to

Help

you

undoubtedly

in

knowledge

gov-

on

will

areas

available

point to this

effect

Requiring

goes

sociation
other

the

ning of public works.

permitted

may

entities.

achievement

proper

Areas

As time

One

the best

assure

0f municipal credit,

or

"?erf?y w emphasize Us

and

followed

come to mind.

complicating

our

to take in order to

,

readily

y0Ur

use

comprehensive port authorThese are but a few examples

those

rightful

the coast

on

,

ernmental

wasted

as

Sanitary

major metropolitan area in
United States has 960 such

are

Upstream pollution of

a

,

which

coping with the growing prob¬
of pollution.
Polluted water

may

you plav as individuals
home communities in advising local officials of the steps

Lakesror some of our
inland waterways, there
may
.

of

many

jn

Great

vast

ficiently,

demands for water but

or

often

imaginary city is

us

to

our

one

sometimes

must
follow
the
dictates of terrain and cannot
stop
at
political
boundaries.
If
our

ef¬

more

districts,

autonomous.

districts

today to

water

use

there^ are usually

school

more

inexhaustible,
availabe

means

which

Then

Knowing that

supply

use

to

sea.

was

during

we

must study where
every drop of
water falls and what we are
going
to do with it, from the
Continental

in

about

years.

A High-Grade Bond Fund
r
■

future

our

separable.
Aside from

THE INSTITUTIONAL

and

for our supply
and
steps to
conserve
supplies already developed.

Water
★

farther

positive

those

*

reach

farther

take
A Balanced Fund

must

>

areas

and

longer

★

*

_

and

fiber,
but also in extensive
quantities to

A Diversified Investment
in Listed

for¬

since

public

while

so

program of this

of?

projects

general

or

call

accelerating but
will understand

believe,

GROUP

to

impatient

year

gram

5

authorized

The

a

next

Sj/e

this

^

•

.

what

■tent

if

•'

'

—

If the rate

maintained

be

can

school

of

rate

next

191

the

main¬

were

tained for five years it would pro¬
vide only 325,000 classrooms. For¬

Deia^are

the

equal,, at

..

Overlapping Junsdiclions
As

meuopoiuaii

with

..

1932,

state-local

'

'

•

Thursday, December 13, 1956

.

par-

litany uiiiicuit problem.
.

•'

.

The Commercial and Financial Chronicle

present

obstacles

to

development

from

of

of

your

this

Mutual

Fund

investment dealer

TELEVISION-

programs.

ELECTRONICS

BOND FUND

FUND, INC.

A Good-Grade

Diversified Bond Fund

EATON & HOWARD

BALANCED

EATON

EUND

&• HOWARD

STOCK FUND

Television Shares

Monogement Corp.

Managed by

For

EATON
Prospectus

on

&

these and

HOWARD

INCORPORATED

16

Industry Classes write

+

135 S. La Salle St.,

to
•

Distributors Group, Incorporated

|

24 Federal Street

BOSTON

BOSTON
ESTABLISHED

Russ
SAN

1924




your

Investment Dealer

or

the

115 Broadway, New York 6, N.Y. |

Building

FRANCISCO

63 WALL STREET, NEW YORK 5, N. Y.

Prospectuses from

Chicago 3, III.

|

above.

|

Name

|

| Address

|

J^ity-State

Volume 184

Number" 5594 7

*

.

The Commercial and

.

Financial Chronicle
(2563)

the major duty which he has
signed to me.

as¬

We

the

that the impo¬
single system on all

of

levels

a

of

difficult

between

Needs" method.
you

not

different
works

various

might

to

seem

timing of

is

such

simple;

progressive

The
ment

measuring

proc--

subject

modification

as

a

'-With

this

overall
of

flexibility
sequence

measured

in

of

of

the

•

■

first

a

little

step

is

of measured

more

the

mind

the

potential

of

Plans.

into

re¬

necessary
to
meet
these
needs.
The resulting document would be
a
collection of quantitative needs

,

Balanced

These

long-

range plans would cover a span
of
perhaps 15 or 20 years and
would represent a thorough an¬

alysis of the measured needs and
relative

A

of

urgencies.. Devel¬
Multi-Year Programs.

multi-year

called
case

ments,
gram.

a

of

mid-range plan
state

a

program

and

local

may

in the

or,

govern¬

.

capital improvement

It

should

cover

be

pro¬

period

a

per person per

each

resources

urement
requires two types of
tools; general criteria and speciifc

criteria.
The

first

tool

measuring
needs, the general criteria, is basic
to

all

functional

fields.

These

criteria include past and projected
population growth as well as past
and

projected

Depending

economic

growth.

the level of gov¬

upon

140 to

a

ernment

concerned,
these
data
will be required for the nation as
a
whole, a region, a state or a

My

specific

day.
range,

state

a

a

available
choose

,

First, in

City

Sewerage

tional

of

the

a

or

a

Department,

needs

category

against

as

in" that

weighed

are

other

the

func¬

and

one

construction

and

requirements.

broad

having been
done, the comprehensive planning

unit of the parent government can
proceed to weigh the relative ur¬
gencies of the functional, fields

Continued

functional

on

person

such

,

might

resources
will
criterion for their for¬

day.

per

The

cooperative

goals

in

basis

similar

for

tive

will

of

For

in¬

of

planning
communities, a

a

Prospectus write
dealer

or

investment

of

separate

CFC

func¬

fields, intensified progress
meeting the needs of the

toward

people,I and due recognition of
local peculiarities and local needs.
The

your

Philadelphia 3, Pa.

comparison of the rela¬

urgencies

tional

results

action

uniformity

sort

same

of

progressive

*

re¬

finements

of
criteria will apply
in all the various
functional fields.

established

aggregate

from

these

accepted standards.

planning

process

factors
In

will

the

be

proceeds

brought

plans

second

a

the

the

programs

third

need

needs

of

with

the

to

the

i

fully managed Canadian

purpose

long-term
>

possible GROWTH

certain

CAPITAL GROWTH and
TAX

BENEFITS

Prospectus from

of

your

local

investment

dealer

or

TI ie

with

same

controlling

50

factor

Keystone Company of Boston

Congress Street

Boston 9, .Mass.

will be financial capabilities.

This is not intended to
imply
that urgency in time and financial

considerations
in

the

this

long-range

of

long-range

cial capacities

phase

in

of

prepara¬

plans,

finan¬

considered

are

™"

considered

plan

Even

sequence.

tion

not

are

but

jjfodon Srtmd

it is

not, at that point, a controll¬
ing factor. Finally throughout the
process public policy and
public
opinion must be considered and

Massachusetts Investors

their influence
accepted.
In

progressing

from

measured

Growth Stock Fund

'needs
into
balanced
long-range
iplans, the parent unit of governiment
s

will

establish

the

relative

urgencies of the respective public

"Nlassachusetts Investors IP rust

works field. Why is this determin*ation

necessary?

The

sum

total

of needs in all fields will undoubt¬

edly

exceed

fulfilling
A prospectus

on

each fund

may

obtained from investment dealers

be

on

or

that

the

the

them.

created

arc

possibilities

pressu£es>>
brought to bear

responsible

parent

of

Thus

and

executive

government.

He

Century Shares Trust

»

of

will

Canada General Fund

receive

•*

A

"

"

urgent pleas from func¬
tional departments under him and

'*
.

THE

PARKER

200

CORPORATION

Berkeley St., Boston, Massachusetts

111

YORK

•

CHICAGO

Broadway

120

objective overall

S.

LaSalle

DALLAS

Spring St.

Mercantile

Securities

LYNCIIJIEIIG, VIRGINIA
1C




St.

interest

This

he

Vista

Avenue

and

Bldg.

means

VJTe

whereby

meet these pressures to the

can

best

needs

LOS ANGELES
4 >3

S.

LIMITED

idemands from citizen groups out¬
side. There must be
given him an
he

>'EW

does

against

then

of

all

by

Bond Fund

the

people.
measuring the

applicable

criteria,

OF

BOSTON

by weighing each func¬

tion against the others. This latter

step is essentially one of analytical
judgment but consideration mu§t.,
be

given to the essentiality of the
service, requirements of law, land
availability and other elements
of local

A prospectus

111

6l

balanced

long-range plans is accomplished
after

the

parent

government

to the shares of any of these
separate
he obtained from authorized dealers or

&

COMPANY

DEVONSHIRE STREET

BOSTON
NEW

Financing
of

may

VANCE, SANDERS

conditions.

preparation

relating

investment funds

Scheduling Priorities and
The

under

Canadian Laws

„

has

YORK

Broadway

CHICAOO
izo South

LaSalle Street

i

Company seeking

timing.

respect to the date by which they
At the .budget stage

principle

Or

factor

must be met.

the

investment

A

range

-

urgency

respect
not

are

fC ana da, Ltd.

Investment

a

For RESERVES, INCOME

multi-

controlling

that

emerges

the

mid

or

specific

be

services

o

|

securities, each Fund with

es¬

to

Progressing into

All

Covering all classes of

to

will

we

factor,

of

a

Custodian Fund,

As

development of bal¬

long-range

plans,

Keystone Fund

eystone

needs

of

year

^ rC.

68

climate, and

provided.

pogg-ble

page

planning in water supply.-'
This might
be, say, 160 gallons per

consider

gr0WtH of

financial

This

government, based

sentiality

«n

funcional

such

water

one

anced

mutual

a

Department

segments

func¬

ward

the

A

re¬

of

The Federal

beginning, will
guidance, say

condiitons,

bear.

elected

but

list

segments supported by a
feasible
long-range program of

for

government

A local

local

other

rrl srt
portfolio

distinct

This results
these

priority

a

tional

govern-

riients.
on

tion

s

lated levels.

criteria,

through applica¬
criteria is, in itself,
only the starting point.
It has
involved only the factor of devia¬

a

involve two

priorities established.
in

a
similar upper and lower
limitation such as 120 to 185
gal¬
lons per person
per day and send,
these to constituent local

Having

Established 1925

and

urgencies.

select

tion

Investors

; needs

relative

agency-or deparment
State Highway

of which

use

day."

as

Hinge

measured

Incorporated

will

developing

and

aggregate

200 gallons per
person per
Within
this
recommended-

clude

in

sources.

their

Long-range planning at this point

The unit of meastsrement
in this instance
might be "gallons

develop-'

objective basis without
for

in¬

•

supply.

Government,

an

most

cooperative intergovernmefitLet us illustrate by us¬
the field of municipal water

furnish

gard

develop-'

needs

Preparation

Long-Range

opment

a

ing

closely.

needs for

collected
assessed

will

al action.

Sys¬

in volume of physical
an-- expressed
nual: programs would be: Deter-- units without reference to
prior¬
mination v of.:. Measured
Gross
Needs. ity.
requirements
minus
These
needs : .will
be
stated
in* existing
usable
facilities
would
broad and general terms
projected represent current or outstanding
as far into the future as
needs. ;'To accomplish this meas¬
is prac¬

their

is

-•

the

are

development

under the jurisdiction of the
gov¬
ernment concerned. This is" done
on

grows in strength and
in accomplished
planning.
f

tical.

Next

the

functional field of public facilities

community

the

Needs"

-'/ TV'

outline

examine it

us

Any criteria

programs.

the

is

in

currently

tem to which I have
referred. Let

one

must be flexible and

ment

System

This

needs idea.: "The

adopted for the
t.o

"Measured

The responsible

government

data

general criteria in conjunc¬
tion with the Bureau of
the Cen¬
sus and
other statistical agencies.
•

Down

'

/>

of

these

projects from the current

Breaks

must
recognize at the outset that there
is a variation as to location and

esses

of

these

stances from Federal
office
is

and

fields

rational approach

a

measured

for this

cure

tion

unit

'

prohibit
the

be

community.

parent
secure

jects.

Variations; multi-year program.

localities

between

of

as

would

futile.

variations
public

-

planning system

government
if

local

budget period, whether annual or
biennial, and constitutes the selec¬

to

occur

sition

and

years

It

this

term

"Measured

may

approximately five

be stated in terms of
specific pro¬
Derivation of Annual Pro¬
grams.
This
would
cover
the

-

"'•

of

LOS

ANOET.ES

iio West Seventh

Street

68

The Commercial and Financial

(2564)

Continued

from

much

67

page

detailed

more

than

the-

in

earlier documents.

Finally,

.

Public Woiks Needs oi America

we

to the devel¬

come

opment of the

mended

criteria

downward

annual

biennial

or

of

their

segments

the other.

ards, the essentiality of their serv¬

against

one

this

From

derive

we

ice, urgency wtih respect to time,
ana prospective financial capabil¬
ities.
For example, a long-range
plan of 15 years' duration might

a

coordinated, composite list of the
segments of all needs arranged in
priority sequence and a balanced
comprehensive program for their
construction.
Again, this would
be supported by broad financial
plans.
A

balanced

should
nate

be

phases

duration.

plan of

long

divided

of

each

Within

apply.

Thus

balanced

the

highest

virtue

of

plan

of

a

third

relative

by

stand¬

The, first
predomi¬
highways,

phase.
phase of

long-range

plan

any

will

balanced

automati¬

cally become the multi-year pro¬
capital improvement pro¬

gram or

In the development of the

gram.

should

urgency
from

a

and

The first

multi-year program, identification
of individual construction

their

and

estimated

costs

projects
will

be

his finance

is here^that
vents

For GROWTH...

BALANCE

or

planning

proper

pre¬

know, better
than
an inordinate amount
of
competition
among
govern¬
able

as

you

for

programs

dollar

ecutive

have

the
If

resources.

and

his

avail¬

the

cerned

financial advisers

available

works

balanced

and

as

instrument

an

for

guidance, they can first determine
most intelligently the total
amount

which

public

budget
allot

should

with

be

in

works

and,

amounts

given
they can

the

assurance

the

applied

any

secondly,

to

proper

functional

fields

public works construction. Un¬
there

is

form

of

there

is

will

this guidance

in

comprehensive

a

risk

grave

be

not

quate share of
share

such

mitted

intended, however, that
long-range plans be sub¬
by local governments to

This

unless

there

is

cost-sharing
law

for

financial

already

aid

*

that

given

it

as

the

plan,
public

an

ade¬

and that

resources

is given

ment

you

for

the

individual

should

be

Such

be

may

wrongly spent.

should

be

in

the

and

at

It

rection

the

of

will

work

Chief

or¬

of

the

the

use

The

has

advice

substance

been

visory

of

of

perous

ment

presented

Committee

local
deem

it

reasonable,

for

a

VENTURE

FUND

FUND

To

Mutual

Fund

Investment
sis

on

with

with

program

possible

income

A
Mutual
Fund
investing in
Atomic, Electronic and
other
Companies selected for
GROWTH possibilities.

balanced

a

with

empha¬

consistent

long-term growth.

For Prospectus and other information about

Knickerbocker Fund

or

Capital Venture Fund, write:

KNICKERBOCKER SHARES, INC.

20 Exchange pi., n. y. 5

Let

the

planning

units

government.

planning

at

all

works

levels

of

Progress toward the

establishment

of

such

units

has'

been slow. Arizona and California

authorized

planning

last

sessions

and

Maryland
only State

the

two

cf

such

units

their

already

the

the

local

|

Mutual Investment Funds

last

govern¬

the

"Metropolitan Area Prob¬
lem," such planning agencies are

most necessary.

the

area,

•
2

Bond Series

• Balanced Series
•
X

Preferred Stock Series

% Income Series

ning

unit

whole

In

metropolitan
the plan¬
obviously be the
a

of

coverage

must
In

area.

other

there

ernments

may

local

be

gov¬

separate

units,
or
several
communities
might band together in anticipa¬
tion
or

of

to

future

attain

common

efficiency

interests

and

econ¬

through joint effort.
Once
these
comprehensive
planning

omy

t

•
I

Slock Series

units

should

Dividend Series

them.

•

&

Growth Stocks Series

in

are

be

being,

close

maintained

In

general,

liaison

between

technical

of

your

have

As

for

There

us.

this

other

to

us

into

on

Request

NATIONAL SECURITIES & RESEARCH CORPORATION

investing in

common

No

start up

us

public

in

is

now

connected

has

of

pressures

added

been

Makris

the

to

Kakouris

&

this

or

to

your

staff

the

Joins

has

time

joined the staff of Goodbody

&

Co., 127 North Main Street. He
was formerly
with Grimm & Co.

munities.

it

will
all

to

reach

aided

efforts

Bankers
such

the

as

you

public

of

scratch;
much

many

parts

is

officials
can

ST.

PETERSBURG, Fla.

—

I

other

R.

Jobin

Investments

Ltd.,

Fund,
A

MUTUAL FUND INVESTING IN

organiza¬

we

With Frank L. Bateman

not

are

completely

much

has

being

done,

(Special to The Financial Chronicle)

been
and

of the framework do

PALM BEACH,
Van

Voast is

Fla.—Adrian R.
with Frank

now

SECURITIES OF THE SOUTHWEST

to

ad

or

Prospectus

may

be obtained from

local investment dealer

BULLOCK FUND
CANADIAN FUND

NATIONWIDE SECURITIES

descriptive prospectus send

this

to:

investment dealer

your

Elizabeth

3, New Jersey

your

investing in bonds

or

for income

TEXAS FUND MANAGEMENT

MANHATTAN

COMPANY
Texas

National

Bank
P.

O.

BOND FUND,

Established

INC.

1894

Bldg.,

Houston,

Texas

descriptive prospectus send

Boston

Los Angeles

this

to

Chicago

Philadelphia

od

871
or




Bullock

For free

BOX

Telephone: CApitol 7-0211

Calvin

Ltd.

Principal Underwriter

Bell

Teletype: HO 566

to:

your

investment

Elizabeth

dealer

3, New Jersey

NATIONAL UNDERWRITER

HUGH W. LONG and COMPANY
INCORPORATED

B.

Bateman, 243 South County Road.

Inc.

For free

242

Beach Drive, North.

ww%. e n

n-v e

Her¬

bert J. Wasson is now with Gerard

support

and

looking

Fortunately,
with
starting

(Special to The Financial Chronicle)

Investment

the

Association

forward

efforts

They

the

by

With Gerard Jobin

that

do

devoted

this objective.

greatly

and

know

responsible

of

be

I

take

DIVIDEND SHARES

A balanced fund
Diversified

■vj.

ORLANDO, Fla.—-Lee L. Timby

realizes bet¬

will take

Goodbody Staff

(Special to The Financial Chronicle)

goal of comprehen¬

done,

3, New Jersey

of

Bankers, Ainsley Building.;

investment dealer

Elizabeth

to:

4 s

•

sive planning throughout the gov¬
ernments of our States and com¬

faced

descriptive prospectus send

ad

with

Investment

Investors, i«c.
For free

the

(Special to The Financial Chronicle)

Fundamental

Broadway, New York 5, N. Y.

as

the road to ade¬

facilities

Established 1930

120

you

and

endeavors. We

one

it

that

I

attain

tions.

stocks

Invest¬

MlAMI^ Fla.—George S. Miller

rea¬

daily routine and become

our

than

as¬

A mutual fund

good

basic

part of it.

to

pros¬

is

Makris Kakouris Addsi

longer afford to neglect
principles.
Properplanning habits must be fitted

ter

the

no

these

a

than
Yours

work.

to

are

the

—

from
Information Folder and Prospectus

governments

them

both hot and cold, over
the past decade and a half have
can

deeply

and

Deringer & Stautz, Inc., 1142 Gulf
to Bay Boulevard.
-

Many

new.

wars,

forced

sound

America

voiced' Linkogle

have

I

local

own

to

group more
a

(Special to The Financial Chronicle)

however, we have
failed in fully utilizing them and
in obtaining the benefits avail¬
able

no

for

-CLEARWATER, Fla. —Fred E.<

nation,

a

American

and

Systematic

themselves

already put

recom-

sistance, information, and

in

one,

main¬

ments, particularly those involved
in

Endorses

principles

not

are

sons

has

has

over

For

in

legislations

which
unit

a

decades.

The

establishment

public

the

nation.

they

Programs

this

comprehensive

tained

i

entails

concept
of

A

implement

St. Louis for

to

-With Deringer & Stautz

President

Planning

is

group.

quate

Organizing for Comprehensive

CAPITAL

That

strong nation is best for

and

desirable.

KNICKERBOCKER

a

Ad¬

feasible

I

in¬

rather hast¬

individual businessmen

as

method

and

that

your

you.

you

on

possible.-

mind

recognizes that that which makes

our

representatives

as

in

before

Bankers.

state

to

of

million'

a
policy
enlightened self-interest which

of

units

citizens

this

leaders
that

address

I know of

competent

civic-minded

of

groups

to

concerned

adjacent governments and seek

and

that

seek

168

Municipal Association.

programs.

planning

to

for

pleased to accept

address

an

The unit should maintain constant

with

so

with

ily and hurry

Executive.

operating
originate and develop functional
plans and the finance officer who

liaison

the

Not

business

vitation

conjunction with
departments which

develops basic financial

best

why I must leave

in

the

which

a

continue

is

was

was

ganization
structure
that
it
is
immediately responsive to the di¬
It

in

matter

a

should

planning

located

so

to-

compre¬

public works needs of the people
be presented to as
manygroups of responsible government

govern¬

similar

of

long
ago
the
President suggested that this con-:
cept of systematic attention to the

planning unit

a

contributing

aspects

Americans.

organization

reasonably

levels.

mu¬

planning.
is

will

which

or

established

structure, the
comprehensive

many

deep interest. Asknow, his Administration has

and

particular functional

a

are

and

President has

State government or
by the
States to the Federal Government

all

more

or

hensive

the

in

with

one

levels.

not

ex¬

phased long-range plans for pub¬
lic

is

detailed

Within

is,
most,

mental

It

higher

There

metropolitan,
regional
State planning agencies con¬

and

field.

waste.

There

works

and

director

burget of¬
ficer.
It is at
this point where
the
dollar
economy
of
proper
planning in the field of public
works begins to be effective.
It

less

INCOME

must be fitted into the
budget by the executive and

course,
total

the

to

exist.

nicipal,

public works needs would flow
from the lower levels of

on

government

budget. The public
portion of this budget, of

Thursday, December 13,1956

..

.

now

upward

of

For

flow

higher levels
and
information

government

public works

to

projects which have

deviation

not, of course,

might
represent
the
portions of a second or

major

will

the first phase

long-range

include those

in

struction

de¬

parent governmental unit, relative

functions

work

of

v/hereas water and sewerage con¬

partment,
the
phasing
will
be
done
by
consideration
of
the
agreed functional priorities. In the
overall
long-range plan of the
urgencies between

amount

schools

of

nance

time
long-range
or

The

5-year

phase for the various func¬

be
equally
divided.
phase might include

subordi¬

functional agency

a

phases.

three

into

tional fields would

equal

the

divided

each

plan

range

-

into

be

would

from the

works
and

Chronicle

St. Louis

Denver

San Francisco

New York

London

—

Montreal

Volume

Number

184

5594

.

.

.

The Commercial and Financial Chronicle

(2565)

Continued

from

page

for

46

Canadian raw materials, ineluding iron ore, petroleum, ura¬
nium, lead, zinc, nickel and many
other materials.

Report of IBA
Canadian Committee
_

Tov

lax

The

creait

government has

part

Canadian dollar would

rwnf

uiYiaena

important

tion of Canada's holdings of gold
and United States dollars* and the

played

an

,terms

towards

directing
savings to the purchase of equity
securities by the provision of a

That

20%

of

States

tax

dividend

applicable

to

preferred

credit

the

or

that

income

is

of

United

this

has

States

not

been

in

dollars,
the

case

has been due to the heavy flow of
capital
funds
from
the
United

from

shares

common

soon go to

sizabie discount when valued

a

have

to

Canada.

been

These

funds

sufficient

not only to
deficits, but have

offset the trade

Canadian tax paying corporations,
In addition to this, Canadian in¬

also resulted in the Canadian dol-

vestors

terms of United States dollars.

.not

are

subjected

to

lar

a

remaining

at

premium

a

m

capital gains tax.
It

is

that

in

the

the

field

greatest

of

possibilities

for the redirection and
cient

of Canadian

Trade

education

more

to

Persistence

matter for speculation

a

how long

Canada

can

as

continue

savings. The

to incur such large deficits in her

Investment Dealers'Association of

trade with the United States, with

use

Canada

is

playing a very imporin this field. A compre-

tant part

hensive

system

of

the

guidance of

tor

of

in

full-time Direc-

a

Education

struction

under

courses

provides for in-

the deficits being offset by the
'low

Investment

Dealers

brokers.

and

Pated that Canada's economic expansion will continue at perhaps
an increasing rate, and tnat for

Stock-

In

addition,
lecture
courses sponsored by the I. D. A.
are held each
year in most of the
universities

of

purpose

of

Canada

spreading

for

some

States

The

with
has

I.

the

of

it

Cana¬

more

film

investments

on

organizations
Canada.
of

and

While

such

to

nearly

imports

various

groups

the

to

offset

from

the

measure

there

of

is

statistically

savings

on

the

in

Canada,
be no doubt that they
important part in help¬

can

do

The

in

value

United
based

is

play an
ing to make Canadians

more

con¬

opportunities

that

her

States,
on

both

the

for

and

consumer

It

that

der>endent

over

It

eanital

will also take

important place
capital exporting

an

the net

among

hut

^at

while
to

cause

the

Canadians

be

volume

have

been

per-

little

a

in the

more

tendency

entering Canada to represent outright ownership or control of the
enterprises
that
are'
being -• fi-

.

.

(Millions

of

CANADA

AND

Statistics

indicate

one-half

Continued

.

.

of International

of

the

Balance

of

like

ALL

Mutual

of

that

all

on page

ital

funds from

the United

cap¬

States

play in offsetting Canada's sizable
deficits

in

States.

The

tween

than

our

that

trade

with

volume

the

of

between any

countries

the

in

other two

world.

This

trade, however, is far from bal¬
anced, for Canada imports much
more

it

from the United States than

exports to her.

rent

the

year,

Aid

to

NATO

Countries.....

cur¬

States

be somewhat in

greater

to the United

will

excess

than

States.

probably
of $1,000,-

her

exports

It is largely

because of this imbalance in trade
that Canada is

import

tariffs

so

sensitive to U. S.

and

trade

restric¬

tions.

Ordinarily,
trade

deficits

Canada's
with

States would result in

recurring

1952

1953

1954

other

345

393

302

296

261

287

55

77

74

75

and

3,929

289

290

312

336

4,123

4,347

4,113

4,737

—516

—471

—588

—445

—435

—378

—316

—362

—359

—951

—849

—904

—807

—1,041

+270

+319"

+346

+288

1

trade...

other

and

284

'

Investment:

;

•

Direct investment in Canada
Direct investment abroad..,

4

Trade

in

Mew

—

33

—104

—

80

+404

+315

+322

+299

+127

-159

-

75

-132

-184

-169

+18

+

+20

+

6

+27

3

—

—

—

—

46

-

outstanding

issues

issues

Retirements

„

—

Foreign Securities:
"Trade

;

in

New

issues

outstanding

issues

—

Retirements

...»

9
5

+
S.

—

—

18

1

—

1

+1
+ 19

37

39

—

•+

...

-

3

dollars

(increase, minus)

(SOURCE: "The Canadian

53

—

Change in official holdings of gold and U.

2

—

Change in Canadian dollar holdings of foreigners

—

80

+ 42

—121

—458

—223

+ 18

+515
+436
+951

Balance of International

MEMBERS

.

MEMBERS

NEW

—158

+244

+277

+1,007

+ 660

+530

+636

+849

+904

+807

+1,041

+ 42
+128
+405

Payments, 1955," Dominion Bureau of Statistics^

YORK

AMERICAN

UNDERWRITERS

246

150

144

155

155

275

302

305

328

145

165

147

160

Current

funds.

383

318

313

1919

STOCK

STOCK

EXCHANGE

EXCHANGE (ASSOC.)

DISTRIBUTORS

—

DEALERS

—

Primary markets in all securities

85

91

89

319

298

5,311

5,858

5,737

5,520

Mutual

Aid

to

NATO

other-current

3,850

4,210

3,916
389
423

375

374

356

94

91

94

16

25

11

200

246

234

465

479

6,180

5,952
+ 13

Current

Account

5,694
+489
-309

9

-

-517

-

58

-360

16

-

-

-443

+164

6,753
-460

11

-

-432

24

-692

Investment:

Canadian
Trade

HAMLIN
Members

+309
investment

abroad...

-

+346

20

-

+426

77

-

+392

63

-

N.

Y.

Stock

issues.

outstanding

+ 38

'■
—

94

r

-

67

-

* + 63'

31

+411

+316

+335

+m

-

89

-146

-203

BROKERS

+ 22

+

7

+ 16

-

+

by Government of
Drawings

capital

+ 34
+ 34
-192
"X 56

movements..

capital

3

20

-

23

-

+128

33

-

1

+

2

Exch.

DEALERS

'37

+

*42

+ '39
+ 30
+ 89

-

+ 50

66

+ 30

Complete Trading Facilities

18

+ 34

-

37

+ 38

-511

-124

-185
"

+443

-

-

+ 44
+ 197

28

+432

"

♦

MARINE TRUST BUILDING, BUFFALO 3

•

+

Teletype BU

V #*'••

■-

145

Rochester* N. Y.
;

wire

to

+692

5

Telephone: BEekman 3-7022

;

Direct

Retail Distribution
2 WALL STREET, NEW YORK

Telephone: Washington 4035
Bell

-

UNLISTED

+ 17

+

+ '33
+ 23

+517 ■" '—164

'The Canadian Balance of International

Stock

SECURITIES

48

+

...

~

movement

AND

LISTED and

i

(increase, minus)
Other

3

-

Canada:

Repayment of postwar loans
Repayment of war loans
Change in Canadian dollar holdings of foreigners..

American

IN

.

-184

+ 12

+ 15

Retirements
Loans

LUNT

Members

+166

-184

issues..,....,

&

Associate

•

17

Foreign Securities:
Trade in outstanding
New issues

Exch.

+410

81

Securities:
in

CITY

-208

-434

25

Account:

Direct

YORK

TUCKER, ANTHONY & CO., NEW YORK CITY

532

5,823

-

to

CO., NEW

222

405

GOLDMAN, SACHS &

24

145

contributions

LOCKPORT, N. Y.

Direct Private Wires

101

9

2, N. Y.

Bell Teletype BU 46

449

423

Countries...

payments

BUFFALO

•

70 NIAGARA ST., BUFFALO 2, N. Y.

408

70

-

BLDG., WELLSVILLE, N. Y.

MAIN & PINE STS.,

477

354

funds.

365
404

-361

X. ect

THORNTON

4,540

341

413

-147

Official

DEPARTMENT

BRADT

Telephone Washington 4970

6,061

450

A.

LIBERTY BANK BUILDING

393

dividends

and

and shipping
Inheritances and emigrants'
Official contributions

Capital

JOHN

86

281

Freight

All

•MANAGER TRADING

385

77
249

receipts..
Receipts...

Pershing

.*

&

■

Co.,

,

New

•

Norwich, N. Y.

.

York

Payments}* 1955?' Doffirtiiifn'Bufeau of Statistics)

active

trading markets

in

COFFIN & BURR

Purchasing and Distributing

INCORPORATED

Buffalo and Western New York issues

State, Municipal, Corporation,

Founded 1898

Railroad and Public Utility

Your

Inquiries

are

invited

Securities

BOSTON

TRUBEE, COLLINS & CO.
PORTLAND

BANGOR
MEMBERS—BOSTON STOCK EXCHANGE
EXCHANGE (ASSOCIATE)

MIDWEST STOCK EXCHANGE

Members

National Distributor

NEW ENGLAND FUND
Organized 1931

Associate

New

York

Stock

Exchange

Members American Stock

Exchange

M & T BLDG., BUFFALO 2, NEW

York

Wire

Connections

FAHNESTOCK & CO.
Members

YORK

Bell Teletype BU 544

Telephone Madison 1400
New

8

+2

+ 59

Established
.

.

62

+ 66

DOOLITTLE & CO

Payments:

(SOURCE:




+306
—
54

42

+ 20

;

Canadian Securities:

222

200

351

immigrants'

current

Total

the deple-

AMERICAN STOCK

—682

Account:

Direct

4,332

115

dividends.......

Inheritances
All

Net

HARTFORD

78

328
...

We maintain

NEW YORK

363

' 4,129

,

transactions.....;...;...,..;.......;

1955

4,152

4.339 ''

274
Interest

.Freight and shipping.,...

United

the

320

334

of Buffalo and Western New York

145

Canada's imports from

United

000,000

During this

2,800

307

COUNTRIES

3,950

be¬

two countries is greater

3,046

294
344

—

(adjusted)

exports

United

trade

merchandise

on

70

230

part that Canada's imports of

2,817

382

the

150

Current

to discuss the

3,280

314

276

on

Payments, 1951-1955

1951

Receipts:

Merchandise

Payments

now

3,696

'

dollars)

ACCOUNTCurrent

Interest

I would

233

3,306

....

BETWEEN

available to them to invest in

the future of their country.

253

3,443

little

entering Canada,

than

224

246

and emigrants' (unds
other,current payments
.
Total Current Payments......

Capital

82

3,274

dividends...;....

for much of the investment funds

hiore

45

regarding
capital funds that

concern

nanced.

199

42

concerned

of

haps they have had
for

have

169

41

2,842

imports (adjusted)........;.;.
expenditures

capital movements..........
capital movement.
Balance settled by exchange transfers
Total financing of current account balance

Present Problem

164

38

191

Net

Coming back to the present and
current problems,
it is observed

174

155
303
'*

3,178

Other

countries of the world,

69

,tt

Current Account Balance

is

develonmenf

155
283

101

'

Balance

anticipated
that Canada will
eventually be in
a position not
only to finance directly a much larger proportion of
own

receipts

Payments:

Balance

The volume of Canadian

levels.

144
282

85

32

Current Receipts

All

the inflow

on

150

Inheritances

th*

mmr

2,598

257

funds

Merchandise

savings is increasing at a fast rate
as
a
result of population
growth,
increasing productivity and rising

her

Total

and

2,355

150

'

capital funds from outside her

bordePrs.

current

l.

longer term, the financing of Can¬
ada's capital development will beof

other

Interest

1955

2,458

2,346

164

Freight and shipping....
Inheritances and jnmigrants'

manu-

1954

'

57

All

Current

3

1953

258

dividends..

and

-

■

1952

2,326

expenditures

Interest

STATES

••

•

•

exports (adjusted)....;
production available for export

Travel

y ™at 0ver the

les

1951

Freight and shipping

Ub-Plv

come

*

Merchandise

Travel

capital

(Millions of dollars)
CANADA AND THE UNITED

Receipts:

Gold

manufactured

4,097

scious
are

!

factured goods,

the United States

Canadian Balance

effectiveness

in terms of their influence

pattern

likely that
terin, Canada's
is

across

educational... methods

difficult

States

Current

the

upon

Balance of International
Payments, 1951-1955

■

ACCOUNT-

industries will eventually be able
to supply a much larger proportion of Canadian
requirements of

cause

exports to the United States will

Toronto

the

longer

YoUur VoneU"d TheT D° A^fso ™S Prediction
proVides°speakers and the us! of growing need in
a

substantial

as

capital funds.

theless,
the

United

of

correspondence

a

well

as

manu-

the

over

available to

public

from

will

cooperation

in

A.

University

made

dian

D.

imports of

goods

amounts

Canada

come

heavy

factured

knowledge to the Canadian pub¬
lic.

to

years

require

the

investment

of

United
States
capital
There are no immediate
signs of major changes that will
affect this situation. It is antici-

principles
practices for the employees of

and

in-

funds.

investment

United

dependent

1

BETWEEN

In

good^, for with her growing population
and
expanding
domestic
markets, Canadian manufacturing

income

It is

lie

effi-

Deficit

less

Canadian

.....

addition, it is
likely that Canada will gradually
become

large proportion of bills is held by
non-financial corporations.

The

*

69

New

York

Stock

Exchange

70

The Commercial and Financial Chronicle

(2566)

United

Direct

States

Investment
(Millions

1947

Gross

Petroleum
""

1949

1948

Inflows of New Capital—

'

1950

1947-1955

1951

1952

1953

1954

1955t

/

.

59

116

140

2

5

10

30

37

11

14

3

9

31

178

192
69

187

172

98

140

66

7

1
52

23
41

2

6

2

41

37

42

88

101

other than

,

Large

Enter-

Enter¬

Enter-

Enter¬

Enter-"

prises

67

prises

prises

prises

prises

^5

31

9

Financial

1

13

15

17

2

4

7

Controlled

18

Miscellaneous

Book valuesin

582

726

191

319

IBA

Canada

1.186

831

898

676

1,768

1,022

1,624

995

8,129

outside

Return

of

66

capital

114

79

243

8

18

30

43

Net capital inflow for direct investment

58

61

84

200

Net

'

309

other

.................

identified

capital moveaffecting the investment of

ments

United

States

residents

States-controlled

Net

39
270

45

37
346

319

350

Percentage distributionsIndustry V,.....

409

Enter¬

prises

prises

enterprises in-Canada engaged in
manufacturing and
mining
are
controlled outside of Canada.
It has been a matter of common

1,572
1,877

5,598
5,923

2,082
3,384

3,449

11,521

5,466

62

103

288

306

Controlled

100

100

61

100

100

47

19

45

32

53

46

49

38

67

Canada

58

33

Canada

outside

42

81

55

63

47

54

51

62

regret

17

17

34

129

—2

28

Large enterprises include all manufacturing and mining companies with an aggregate invest¬
in Canada of $25 million or more at the end of 1953.
There were 13 such enterprises in

23

81

101

217

304

448

344

316

351

the

petroleum

classification,

dian

14 in other mining, and 55 in other manufacturing.

of

including revaluations, reclassifica¬
tions, and similar accounting

Non-Resident

,

178

187

114

166

188t

330

218t

Ownership

509t§

as

Percentage

a

Selected Canadian

of

'-New

book

in

value...

120

259

331

288

470

636

534t

674

Industry classificationPercentage of total owned by all
Manufacturing*

investment abroad, etc., affecting the tolal value of
residents in United States controlled enterprises; also
includes
classification
adjusments
in
respect
of
direct
investment
transactions
representing
significant investment in non-United States controlled enterprises.
Canada

in

tThis

is affected by unusually large
reclassifications
by possible revisions of the 1954 totals.

and

§Provisional

NOTE—In

estimate

addition

subject

to

direct

in

Other

"The Canadian Balance of International

Value

(Millions

Direct

in Canada,

Govt,
Other

Miscellaneous

funds

1949

1951

1952

1953

f-\

1954

2,304
1,450

3,095
1,534

1,106

1,106

3,896
1,898
1,269

4,532
1,835

1,368

municipal bonds
portfolio investments

5,206
1,870
1,535

5,740
1,822
1,641

"...

...

...

130

94

assets

170

1,382

...

...

195

47

above

industries

and merchandising
by U. S. residents:

51

54

56

40

3S

37

tion has

36

27

20

18

18

17

when

39

38

32

32

32

32

30

above

and

34

35

36

38

38

34

31

32

45

49

52

15

industries

33

23

petroleum exploration

21

18

21

IS

17

16

30

20

16

16

16

15

19

24

22

23

24

25

25

book

value

not

4,660

4,990

5,905

strictly comparable with earlier

7,258
years.

7,998

with

merchandising

"The Canadian

Balance of

of

petroleum

by companies engaged
manufacturing.

included in

are

International

This

been

penalty

tax

conven¬

ratified

by the

Government,

United

States

a num¬

companies

in

Canada

position

to

provide

in

a

Canadian

public

with

an

will

the

oppor¬

to participate directly in
equity of these Canadian sub¬

the

principally

In

(Millions

170

w

of

1953

Dominion

10,349

858

744

930

964

354

413

2,028

2,087

-382

426

1954

the

Manufacturing:
Vegetable products

1953

Animal

products

Wood
Iron

and

and

in

737

608

515

782

886

914

fields,

appear

316

376

1,870

1,822

286

325

342

relatively unimportant and
outweighed by the many

instances of cooperation and
that exists between the

more

393

1,835

far

are

Non-metallic

harmony
2,056,

two countries.

449

-

are

tne

These latter quali¬

particularly

investment

apparent

field, and

it

95

72

78

82

61

59

62

769

837

937

619

630

773

623

699

723

694

722

606

695

499

538

622

exist between any two
groups
that
which
exists
between

Chemicals

366

402

259

276

293

Investment

60

66

minerals

and

Miscellaneous

allied

products.

manufactures

339

580

649

543^

doubted

more

669

430

-

be

567

whether

a

,

--

116-

79

V

and

in

is to

closer

and

agreeable relationship could

than

*

87

...

se¬

differences

121

metals

all

few

some

these

89

paper products
products

Non-ferrous

37 Wall Street, New York 5, N. Y.

Canada

States

115

Textiles

Denton, Inc.

between

United

re¬

relation¬

of

lected

1954

ties
,.

exists

like to

close

minor differences in

by United States

1952

—

433

would

very

activity.
Although ' it
would
be possible from time to
time
to
place
one's
finger on

Owned

659

816

Municipal

Securities:

that

spheres

I

the

on

and

dollars)

Ownedrbyall Non-Residents

j

1952

tProvisional estimate subject to revision.

closing,

mark

Payments, 1955," Dominion Bureau of Statistics)

_

&

in¬

tunity

(Classification by Type of Investment).

,,.c

Burns Bros.

has

ship

355

9,622

8,868

tax

a

subsidiaries

and

Provincial

Total

it

of

be

these

tax convention

recently been revised, and

United States
ber

'

past
Canadian

States

States.

39

45

23

6,600
1,649
1,575

117

257

United

40
57

37

One

the

companies that
less than 95% owned in the

44

'

in

in

United

were

56

.

Foreign Capital Invested in Canada, Year Ends 1952-1954

1955t

302

...

249*

that has resulted

32

*lnvestments in exploration and development
refining and production of petroleum products

(SOURCE:

Government

*New series

:

v

;

utilities

of

a

to

in

sidiaries.

dollars)

1945

1,993
1,205

and

New investment

of

1953

46

,

1930

investment

Other

Total

Selected Year Ends 1930-1955

Classification-

of

Payments, 1955," Dominion Bureau of Statistics)

States Investments

1952

44

:

Manufacturing*
Mining, smelting and
development*
Steam railways

new

in

United

of

1951

42

37

utilities

Total

machinery and equipment
included in gross domestic investment as. published in the National Accounts, the above figures
reflect investment in other forms and the acquisition of existing assets and resources of Canadians.
For these and other reasons the series are not strictly comparable.
(SOURCE:

1948

42

States.

of

participation

the

Cana¬

wholly-

are

United

provision

55

Percentage of total owned

and

construction

new

1939

40

development*
railways

portfolio

and

1930

38

Mining/smelting and petroleum exploration and

revision.

investment

to

between

1926

Steam
.

figure

'
non-residents:

....................

tPreliminary.

investments

the

in

of the

obstacles

dustries has been

860§

retirements, borrowing,
by United States

issues,

investment

opportuni¬

Canadians
many

the

main

equity

Industries, Selected Year Ends, 1926-1953
increase

by

in

the

to
97

that

companies that

owned

•(SOURCE: "The Canadian Balance of International Payments, 1955/' Dominion Bureau of Statistics)

Retention of profits and other factors

Net

Canada

ownership of

ment

45

adjustments

in

ties have not been greater for
par¬

ticipation
20

inflow.....

in

Controlled
•

—35

...

(Per cent)

Total

United

in

enterprises'*

capital

383

364

Report

Enter¬

4,290
3,839

...............

Controlled
Total

.

w.

prises

12

Sub-total

69

page

Enter¬

Dollai^s)

(Millions of

Canada

manufacturing
mining—
All
Large

—and

petroleum refining,
All
Large

2

v

from

Canadian ;

Total

Manufacturing

exploration &
development
All
Large

All

32

71

n.i.e

than petroleum

development,

—and refining—

23

Continued

Mining other
ration

; v

fr

^

12

:

n.i.e..

Merchandising

Manufacturing and Mining Enterprises in Canada,
Concentration and Control, End of 1953
Petroleum explo¬

"

development, refining, transportation, and merchandising).....
Mining n.i.e.
Pulp and paper
Manufacturing n.i.e
Utilities

Canada,

■-

(exploration,

industry

in

dollars)

of

Thursday, December 13,1956

.

.

.

the

Bankers

of

Investment

the

America

Dealers'

of

~

Sub-total

Underwr iters—Distributors —Dea le rs

Mining
Public

and

3,537
1,076

..,

smelting...

3,925
1,422

4,260

1,656

2,916
§76

1,418

644

3,214
.1,315

by the
1,420

-

620

Financial

Ca?iadian a?td Domestic

Other

447

530

577

317

383

418

1,066

395

434

726

-

prepared

Committee.]

1,249

-

were

Respectfully submitted,
CANADIAN
David

696

K.

COMMITTEE

Baldwin,

Chairman

151

149

116

130

124

Nesbitt, Thomson and Company

467

561

249

257

302

Limited, Montreal

11,458

12,469

7,998

8,868

9,622

'*

investments

..j.....

(S0URCE:-4"The Canadian Balance of International

Frederick B. Ashplant

Vice-Chairman

Payments, 1955," Dominion Bureau of Statistics)

F. B. Ashplant & Co., New York

Burns Bros. & Company, Ltd.,

Toronto, Canada

1,210

..........

-

Burns Bros. & Denton, Ltd.

625

1,194

enterprises

Total

|f

590

2,144

institutions

"1

Affiliated with:

550

2,100
776

Merchandising

680

2,068

•

~

herein

624

639

Sub-total

[Editor's Note: The tables

reproduced

Utilities:

Railways

Investment Securities

Canada.

.3,489
1,522

<

Toronto, Canada

Members: The Toronto Stock

Exchange

/

Canadian Stock Exchange

Toronto

Montreal

•

•

Ottawa

mm
•

•

Winnipeg

*

Hamilton

I'

illlillllllilliilllillll!

x

4

*• '

Ife.vX'

% <

m

-

-

BONDS

STOCKS

DAWSON, HANNAFORD INC.
37

WALL

STREET

New York 5,
f-

,

N. Y.

*

Markets

.

BOwling Green 9-5177

.

maintained in all classes of Canadian exiernal
and internal bond issues.

"

Stock orders executed

DAWSON, HANNAFORD LIMITED
507

Place

d'Armes

50

Exchanges,

King Street West

Montreal

or

the Montreal and Toronto Stock

on

net New:York

markets

quoted

on

request.

Toronto v".

Marquette 2385

DIRECT

EMpire- 6-9271

PRIVATE

WINNIPEG,

WIRES

CALGARY,

BELL

SYSTEM

TO

TORONTO,

VANCOUVER,
TELETYPE

NY

MONTREAL,

AND

VICTORIA

1-702-3

Underwriters and Distributors

Government, Provincial, Municipal and
Corporation Securities

Bomimom Securities ©rporatiom
Boston

DAWSON HANNAFORD & CO. LTD.
Members




40

EXCHANGE

Ottawa

PLACE,

NEW

Telephone WHitehall

London, Eng.
Calgary

Montreal, Toronto and Canadian Stock Exchanges

Associate Member American Stock Exchange
T oronto

Philadelphia

YORK

5

Montreal

4-8161

Winnipeg
Canadian

Affiliate

—

and Canadian

Member
Stock

Toronto, Montreal

Exchanges

Vancouver

Halifax

.Volume
tw

184

Number 5594
'

>

-

"

■

.

.

The Commercial and Financial
Chronicle

.

-

'■

'

•

*

tl

(2567)
Arnold B. Massey, Vice-CJiairman
Mills, Spence & Co. Limited

Continued from

„

30

paqe

net

'

Some External Aspects
Of Canada's Expansion

»

Secretary-Treasurer
Greenshields

Co

&

lnc

Montreal

Ralph D. Baker
James Richardson

&

Sons

quently

Winnipeg

C.

E. Ames

G.

arise

because

the

&

suit

Co.

Incorporated

that

fail

to

ci

exports

fall

achieve *a
a

been the

ports

Toronto

rate

least

at

or

normal

growth,

Gairdner

in Canada.

case

increased

Ex-

price

are
actually running at a
nearly 50 % higher than in
Indeed, to some extent the

1950.

Gah-dner"a-nd-Company

fact

Bell,
Gouinlock
Limited, Toronto

&

pU

^claim

Johnston

than
;

York

C

o r

-in

p r>

;

McLeod, Young, Weir &
Limited, Toronto

®

P.

Dominion

.

•

tion, New York

.

W.

Securities

Pearson

almost

L

H

Corpora-

since 1947

there

.

.

..

-

,

'

num

Nor is

Company, Lim-

From

iron
over

.been
.

formed

&

with

at

are

John

en-

bZ\ZT
Pollard,

T.

Jr.,

President;' "Louis

H.

•

Greenberg,"

Vice-President and Treasurer. Mr.
Pollard

.Gould
with

was

Co.

M.

J.

a

-phe

very

ready access enjoyed by
Canadian borrowers to the

capital

inflow

direct

invest-

of

market

of

the

United

States makes them
quite

sensitive

to

relatively small changes in the
spread between long-term interest
rates in the two countries. When

,

.

rSI

imDorfs

7

a

over

I9g0

le;fe;

to

p

sump

onlv

•r

Ar1j

0„„,iry,

.

shows

that

•

be-

UP

| other

Side of-the Medal
now

Fpninm

balance

ns.
,

capital

such

ST

i'„
in

Canada

mLiL

~

..

the

as

f

in

■

i

past

year,

relation

to

the supply bfw.»m ralatlon.to
of loanable funds has
been such that long-term interest

fl

* p™iects under mod-

%^ have* ITKiSfltSe?
™ent'machinery, etc., to be used

dians takes place

25fJ*

re"

^

the American

on

°f

c

Foreign Purchase of Canadian

the situation I ^f^rrPd^n^^rd11
referred to regard-

Securities

»
The other

'cs5

direct investments

mg

main channel of capi-

in resource

industries where very large sums

nnn^iHent^nf ?•'

m°ney *I?ve, been re<Juired to
partlcular

ma"Ce

mg
the

new

Yssues Yoid Sy

Projects-

•

Canadian

suited in

a

securities

has

re-

net capital inflow be-

tween 1950 and mid-1956 of

vincial

$5()() million, excluding the trade

and

municipal

recently

securities,

Continued

number of large

a

over

72

on page
:

of

payments

in

personal

If a person runs a deficit
and goes into debt presumably he*

make

Street, New York 5

'
■

105 West Adams

At all events, he has to

Street, Chicago 3

formal

some

provision for
his indebtedness,The balance of i

It

individual

Gundy & Co., Inc.

,

14 Wall

advance

Payments in a free economy like
nrnrhirtmn
production ;tbe Canadian has no such planned'

of assuming

large
to

It

v

periods

required to fi

money

terms.

program>
erge

tecb

reouired

monev

ncrind?

t^rh
tech

Canadians aoroaa have been Dronave oeen pro-

$100 million per

,anium

of

and

Canadians abroad

like to comment

or has to scrounge up cash along

cur-

:tions
P

by alm°st

same

a

drill
skm

i

and°lte°ss to the very
and access toX ver'v

outPut ln dh6 £utuFe'

the route.

1955—at

i

be-

bas arranged for'this in

were

•

Uons

ini t®a?su?ie
hnndtn^bi* nnl ^iTr

taken

t'LL^rsZl^Terefor'be
*

demand

little

a

and at the

q

rent rate or<

nf

y

is

it
it

^

spite of the

time Provide;:§Bi)'orts—which
negligibie be

weight

e

quick

are

initiative

!
\
^^"'rnarlet'

briefly on the other side of the though
medal, i.e., the financial counterpC. ^besp dcffeits, our nej^
capital imports. There is an un¬
avoidable tendency to think of the

year,

grown

oil'consumn

aWevel

at

other

Th

abroad rather than in Canada
it often raWfe* with
carries with

,fiFst hal£ o£ I956' ™he" ou^

1 would

long-

Canad^,he prairie discovenvied us to hold fuel

import pr'opo

-

t

development,

In

who

and

enjoy the

have
in

than

menYt

aslt waTforlxSpkln l™d

Direct

^an?dian e^onomy .an? pJbvide^.

eries have

formerly with A. J. annum- APa
Greenberg was-ds on^y °n t
Co.

in-

alumi-

our

-

Mr.

Shuck

War

^

—

30%> imports of investment goods Canadian secunties. The largest
rose bY as much as 43% while e,ement 5n this has been the net
Increased Canadian Equities
consumer
goods
were
up
only-.sale of new issues by Canadians
Listed
18%- This distribution of imports to investors outside Canada. On
Non-residents of Canada have
is gratifying, of course, because balance from 1950 to mid-1956, also increased their
holdings of
^ means that the bulk of the sales of new issues have exceeded common and preferred stocks in
large increase in imports has gone retirements by over $1,400 mil- Canadian corporations. The
very
to broaden the structure of' the lion, exclusive of large retirements; large two-way trade-in outstand-

a

.

'

.

re^^ce

$100

tion in

135

Broadway,, New York City, to
ficers

Canada

capital

form

...

tween the first half of 1955 and

ha«-

copper.

sag

expqglfs
mi^

_

Co., Inc. has

offices

and

few rMTion dollars

a

ore

S
*

of

ment. Since 1950 this has amounted
to
over
$2,300 million or about

lhe>ke

ourDo^e^whfch^^a? re^enU^
baf recently

in

apncrallv

w^Jgigan to
opome of

the

PurP9?e which
™me avaiteWe

agricultural £or
off
few

^hen

exceptional
p

Forms J. T. Pollard Co.
Pollard

fruits

'

a

hotter

or

recently

begam to

period

Midland Securities Corpn. Lim¬
ited, London

with

Meckel

this

years ago
first

Douglas B. Weldon

John T.

case

the

physical limits of

*°lal fmP°r£s "ent

apparently

an

mc^e

and

markets

ited, Montreal

.

corporate issues have also
been sold in outside markets,

cur-

large share of the

«

nrndnpfc

new*nr?nt

demand

hieh prices

Wood, Gundy & Company LimArthur S. Torrey
W. C. Pitfield &

been

TOe

but

all

of

investment

£h.e

continuMlv

—

for

prices

Since the Korean

has

catiahlp

Scott

in

FnrP<st

vnars

been

ited, Toronto

-

the

^
sorre °f *be recent corporate isprincipal increases in our garded, in a sense, as a cause of sues has probably been a factor
imports can be directly traced to the current account deficit rather dictating recourse by Canadians
*he investment boom. A co.mmod- than as a means of covering it. to outside capital markets. In this

eroDi

firm

rather

cause

....

have

wheat

volume

noses

npnc

between

>been at ranacitv dpmand

Rutherford

-

to

we can

we

of

with

demand

nf

pany

George

1950

normal

years,

good

have

Com-

nine

or

pnnnlp

—»—
Henry Rateliffe

Since

equivalent

.seven

and

Limited, Montreal
J.

the

eight

Securities

able

no
particular credit-other
taking advantage of our op-

portunities.
had

Stanley E. Nixon
Dominion

been

0f SOod luck for which

run

Wood, Gundy & Co., Inc.
New

the

than

imports

productive calcify

while the expansion was
going on
must be
attributed in part to a

Jarvis

S.

have

we

in

The bask

mand

^ortfVmuch

McLeod, Young, Weir Incorporated,' New York 'C
:: "
*
Edward

that

Company

•

:

with

takes

imports is the intensity of "I!
de-

in

increase in foreign demand

Limited

Percy R. Hampton

R.

by side

many

in
exports. Our imports are running
70%
higher than in 1950, with
practically'all the increase" due to
practically all
increase

Toronto

H.

new

transactions.

In

° are^tfefefore lonZue^o'a

greater rise

I should like to stress that this has
Stress
not

Fullerton

A. E. Ames & Co. Limited

W.

rent

Import Rise Due to Investment

verted..£l0m exP°rt with the re■»?*?* to
domestic expansion,

YOTk

James A.

they

SlfgoodT anTservkes Yrfdi-

Collier
comer

Andrew G. Curry
NeW

ac-

,

iv.
K.

itedMSSf & QUinIan Lim"
A.

side

occur

Peter Kilburn

Wm. t.
m. T.

capital borrowings which

company a current account deficit

Toronto

is

the

aggregate

Direct

wire .connections'

Ottawa and
cities.

ofp

through
Stock

orders

decisions

inaependently arrived .at. day by day. The

between -Nevr York,

Canadian affiliate

our

executed

all

on

affiliated
■

i

■

i,

-

•

f

■

•

•

*■

L

j

'*»

Toronto,

Montreal

and""-*

other principal Canadian

to

Exchanges in Canada.

with

•

,

f*

••

i

1

•

1

•>

4

-

:

-n
•'

»

^

'

-

Wood, Gundy & Company

-....

Limited

*

i

■?

%

1

■■■■

\

4

■■

,

.

^

ana

•">

^

i

Wood, Gundy & Company
'

--

t..

y,' '■'-'■ii

■

*

Exchange

*

MONTREAL
.

SAINT JOHN

HALrfAXv.lKLTCHENER j

DEALERS

IN

GOVERNMENT, MUNICIPAL

CORPORATION

.

Montreal Stock Exchange

,;Capadian Stock Exchange

"

TORONTO

QUEBEC

-v.;;Members- of

■

The Toronto Stock

WINNIKJEG

~l

OTTAWA

KEGINA

...
•

*.

'
.

VANCOUVER..
HAMILTON

.

LONDpN, ENG.

f

.-.wLONDON,*ONT,"

^ ^EDMONTON .". CALGARY

"

.

VICTORIA

AND

SECURITIES

Cunailian
50

King Street West
Toronto, Canada

276 St. James Street West

Montreal, Canada

T«l«phon«: EMpir# 4-0161
Ottawa

Winnipeg

Kitchener

;

Complete

Telephone: HArbour 4261

London

Quebec

Hamilton

Sherbrooke

Vancouver
Windsor

facilities for
Canadian Stock

Calgary

and Bond

New York

trading.

members

Toronto Stock

McLeod,Young,Weir & Ratcliffe
MEMBERS

OF

THE TORONTO

STOCK

CANADIAN

STOCK

ORDERS

EXCHANGE
STOCK

EXECUTED

MONTREAL STOCK

EXCHANGE

ALL

Exchange

Canadian Stock

Exchange

Calgary Stock Exchange

EXCHANGE

ON

Exchange

Montreal Stock

Vancouver Stock

Exchange

Winnipeg Stock Exchange

EXCHANGES

Winnipeg Grain Exchange

50




m

James Richardson & Sons

King Street West, Toronto, Canada—EMpire 4-0161
"T*

montreal

toronto

victoria
swift current

kingston

winnipeg

lethbridge

galt

calgary

medicine

saskatoon

chatham

leamington

EDMONTON

haT

brandon

REGINA

VANCOUVER
MOOSE

PORTAGE LA PRAIRIE

kitchener
WINDSOR

SIMCOE

JAW

KENORA

ST. THOMAS

$
I

Tl

The Commercial and

(2568)

Continued from page

flows have played all through the

forts

piece.

71

stability

made

(Canada securi¬

in Government of

ties.

An

number

increasing

listed
on
stock exchanges outside Can¬
ada. Growth potential rather than
yield appear to have been the im¬
portant consideration influencing
foreign
investors
in
Canadian
equities, and this is exemplified
tjy the formation of diversified
investment

American

nity

funds

incorporated in
designed
to
give

but

stantially to

has

basis than are Americans.

the

dollar

in

of

rest

the

are

a

of

few
the

official

since

exchange

were sus¬

Since then, the

1950.

including,

forces,

Canada

world

say

behavior

the

about

pended

to

now

propose

policies,

a

of

course,

the

and

monetary

official

interven¬

fiscal

of

effects

with

Under

Nevertheless, for

conditions, the govern¬

free rate the

fixed

rate

ment

is

ably

change offered, and if the inflow
is large and rapid it is difficult to
take offsetting action to prevent

stable.

believe
term

a

There

that

at

capital

is

most

to

reason

times

short-

movements, such as

ada

and

abroad

payables

commercial

and

receivables,

and

have

contributed to this stability. These
short-term
capital
movements
have

shown

ward and

tendency to be in¬

a

so

a

policy has been to allow the rate
to
be
determined
by
market

Although the inward movement
been preponderant,
one should not conclude that capi¬
•and

as¬

attrac¬

Canadian dollar has been remark¬

support the Canadian
Canada, but it may come dollar when it was tending to fall
surprise to you to leafn that and outward when it was tending
even
excluding official reserves to rise, thus limiting the rise. This
and bank balances, Canadians are is in marked contrast to our ex¬
as

fixed rates of

of capital has

between

foreign

to

many

investment.

for

in

sets

Canadian

Capital Invested

movements

official holdings

our

relation

in

small

words

Abroad

tal

sub¬

gold and U. S. dollar balances.
Our
investments
abroad
are

I

ciation.

Canadian

in Can¬

added

offered

tive fields

several changes in balances held in Can¬

to

issues

also

of

capita

an
opportu¬
capital appre¬

in

bond

have

We

ada.

heavier investors abroad on a per

investors

share

to

Bank

World

Canadian equities have been

Canada

subscribing

public

of

monetary
Since 1950,

Canada.

Justifies Free Exchange Rate

Some External

Aspects
Of Canada's Expansion

maintain

to

in

Canada

Financial Chronicle

perience with

change

fixed rate of

a

short-term

ments

were

capital

During the present

funds

notwithstanding

the

of

value of the

The

need

rise in

for

the

reflected

rise

a

Canadian

in

dollar.

the

and

volume of imports—as

in

increase

an

fixed

under

have

rate

therefore

condi¬

great

a

in

out¬

in¬

free

rate

provides some
that capital inflows will
in

real

rather

terms

ac¬

I

point

a

might

fixed

rate, and they must find the

purchase the exchange. Under the

been fully in accord with the pro¬

who wants to
buy Canadian dollars has to com¬

$700 million. We have also added
our
foreign assets abroad in

—from

visions of the International Mone¬

other

various

Perhaps the most conspicuous fea¬
ture has been the rather paradoxi¬

abroad

repatriated

1950

Government

of

of

from

Canada

obligations to the amount of about
Co

Our investment in

ways.

Canadian

controlled

companies

cal

equality with the Ameri¬
to
3
or
4%
higher.

dollar

can

behavior

of

abroad has -been in¬
creased by over $350 million (not

fairly persistent
strength in the face of substantial

including retained earnings).
provided
funds
to

We

current

the

there have been several occasions

operating

<iave

i.B.R.D. for its lending

operations

when

account

a

rise

in

deficits.

paying up our entire capital
subscription
(and becoming the
only country other than the U. S.

lar has coincided with

to

important

do

so)

and

by

the

In

fact,

the Canadian dol¬
an

increas¬

ing current account deficit. This,
of course, goes to demonstrate the

Canadian

part

that

capital

in¬

The

Canadian

member

tance.

to

and

continue

1950

whose

for

with

fluctuations

I

would

fixed

a

either

work

ar¬

free

not

hand,

is

a

we

great impor¬
provisions pro¬

Fund

vide

on

have

attach

to

The

exchange

since

rangements

side

like

exchange
limited
the

of

take

to

to

par

this

rate
1%

value.
oppor¬

tunity of saying that the attitude
which
the
Fund
has
adopted
towards
not

Canadian

the

been

in

doctrinaire

the

case

slightest

has

degree

rigid. On the con¬
trary, it has been helpful and un¬
derstanding.
Without for a mo¬

Midland Securities
members:

ment
corpn. limited

The Investment Dealers' Association of Canada

well

suggesting that what works
in

Canada

and

is

necessarily
suitable for other countries, the
Fund
has
fully
recognized
the
special aspects of the Canadian
situation

Canadian Government,

or

which

have

led

to

the

present exchange arrangements.

Corporation Securities

Free

Rate Found

has

The Midland Company
member:

The Toronto Stock

Stock orders executed

Toronto, Ontario:
London, Ontario:

been

at

periods in

tory.

The increase in foreign debt

by

to

a

helpful

free

factor

rate

in

the

has
ef¬

all

& Erie

imports

like

result in exports.

or

with

system,

the

on

which

the

to

To

other

person

purchasers

for

of

considerable extent the rate

a

is determined by the
availability of resources, and the
terms on which the public author¬
ities or other owners are prepared
to see them developed and used.
progress

Another

cussion

related

is

tions

and

the

American

for

individuals

and

one

reason

or

a

who

another

wish
to

sell

industrial

Since

ments which

market forces

on

pressure

of

the rate has the

is

is

it

Canadian

effect of this mechanism

dian

of

into

mand

inflow

other

of

accompanied

by ^pressure
resources,
that the

domestic

inflow

fect

en¬

in conditions of largo capital

sure,

on

is to

of

capital either forces
capital out, through its ef¬

on

the rate, or takes the form

goods
the

abroad

and

services

Canadian

as

introduced
from

economy

supplement to Cana¬

a

crease

The inflow of capital which has

been such

an

important factor in

mainly
are

direct

participation

in the

spite of
like
no

foreign ownership of

now

invest to any con¬

extent

number

of

in

U.

ticipation by Canadians in equity
investment

ample, for

have
as

income

equal

in

Canada.

been

an

abatement

to

from

tax-paying

Inc

-

Teletype: NY 1-3703

Canadian Affiliate

OFFICES IN 14 CITIES IN CANADA AND ENGLAND

Greeiisliields & Co Inc
A. E. Ames & Co.




1910

Boston
Montreal

Toronto

Quebec

Sherbrooke

of

their

liability an amount
20% of the dividends

Exchanges

BUSINESS ESTABLISHED 1889

ex¬

Cana¬
permitted
to

tax

received

(N.Y.)

For

some years now,

UNDERWRITERS AND DISTRIBUTORS

established

equities.

effect of encouraging greater par¬

64 Wall Street

Business

S.

steps have recently

been taken which should have the

A. E. Ames & Co.

Incorporated

be

The in¬

very

longer

siderable
A

Provincial, Municipal and Corporate Securities

A. E. Ames & Co.

may

high rate of Cana¬
savings and the fact that, un¬
previous periods Canadians
a

Investment Securities

Telephone: WHitehall 3-9525

invest¬

referred to there

Building

Greeiisliields & Go

ex¬

Canadian business has occurred in

claim

Capital Inflow Rate

the

to

permanent in character.

dians

savings.

Questions

sectors

fear that the exclusion of

some

bringing supply and de¬
balance
without, as
I have already indicated, official
intervention except as a contribu¬
tion
to orderly
conditions.
One

effect

tended

clusion of Canadian participation.

eign

The

which

to

has

to concentrate in certain resource

Canadian dollars and acquire for¬

exchange.

subject of dis¬

extent

investment

Specializing in Canadian Government,

New York

and

displace

Another question which is some¬

354 Talbot Street

Members Toronto and Montreal Stock

his¬

either

116 March Street

Limited

our

petroleum

which

ore

215 St. James Street West

Canadian

has

than matched

Exchanges

Eastman Dillon, Union Securities Co., New York

it

the investment has gone

things

(iron

than

increase in national assets.

an

into

more

50 King Street West
Huron

St. Thomasi, Ontario:

Private ff ire

been

the

many

has been much

less

Exchange

on

Sault Ste. Marie, Ontario:

Montreal, Quebec:

LIMITED

operated,

or

is

supply
which is provided not by the cen¬
tral authorities
but by corpora¬

dian

Helpful

In the conditions under which it

dollars

rate

into

Municipal

foreign

product

exports,

pete in the exchange market with

tary Fund, of which Canada

of

ning

maintenance

national

gross

an

orderly conditions in the ex¬
change market. Since 1952 the
Canadian dollar has been quoted
within a relatively narrow range

^Canadians

the

of

this

expand

little for it is

Canadian

to

burden

measured by comparing it

latter times raised in whether the rate
important of development—in which foreign
one.
Under fixed exchange rates capital has played an important
been
a
excessive,
and
person
can
acquire a title to role—has
assets in Canada simply by selling whether progress at a somewhat
slower pace—and with a greater
foreign exchange at the pegged
price. The central authorities are admixture of local capital—might
required to buy all exchange that be preferable. I do not pretend to
is offered in order to maintain the know the answer to this question.
haps

factors mainly responsible.

For

we

capacity to service it.

our

total

Per¬

standing payables—seem to be the

limited

tions

example,
have since the begin¬

street.

one-way

whether

ex¬

of

Much of

flationary potential.

place

short-term

liquidity

Canada, and large capital in¬
in
an
economy
at
full

flows

in the form of money.

however,

year,

movement

is

good deal of

a

One very natural
have

cess

with

be extremely large

conse¬

cepted capital from abroad in

present

take

there appears to have been an in¬
ward

caused

searching.

as

for

assurance

soul

concern

The

terms may

The

have

tions

long run

and some of its implica¬

debt,

can

tions

to think about its
quences,

quite small in Ameri¬

seem

stretch

has

Sums

than

move¬

ex¬

development in Canada
inevitably caused Canadians

postwar

supply.

an

money

ex¬

factor of instability.

a

which

all

buy

Thursday, December 13,1956

.

increase in the

leading to

domestic

to

control

exchange

under

when

this

required

..

Ottawa

Cana-

Volume 184

Number

dian corporations.
been

5594

The Commercial and Financial Chronicle

.

Also, there has

discussion

some -

.

.

degree

to' urge

as

*

whether the Canadian institutions

in

which

of

that

competition

is seized

others,

upon

you
upon

for

Canadian

mobilizers of

chief

the

are

savings

playing

are

as

large

a role as they might in pro¬
viding equity capital to Canadian
business. Finally, steps have been

taken

to revise

regarding

rangements
tion

dividends

of

order to

remove

disincentive

panies
Canada
some

certain of

the

paid
any

our

owning

for

have

public

in

I have

dence,

with

The

groups

American

S. World

like

to

in

nuclear

sive

conclude

these

by referring again to for¬
In spite of the "great
development of our intaimal mar¬
ket, foreign trade remains of great
to

With

us..

a

total

trade turnover exceeding $10

lion,

Canada

fourth

are

bil¬

become

the

trading country in
With a population less

largest

the world.

than

has

10%

of

yours,

40%

over

imports

our

those

of

of

the

United States.

the

We have done away, as you know,
with
all
exchange controls and

restrictions

relatively open economy with
only a moderate degree of tariff
protection. We have pressed other
to

to

trade.

aged

We

by

the

remove

have

the

removing

past

few

countries

this

gether

obstacles

by

certain

during
the
we think

more

Sand

steel

Gravel

and

its sales

on

dollar than

other competitor.
It

has

butter"

been,
1923.

its

not

alto¬

the

im¬

until

world

also

recently,

very

payments position.

in

Kaiser

us

industries.

nucleus

Sand

were

getting

in

of

management teams

each

are

of the forward steps
the United States in in¬

aware

taken by

came

from

Gravel.

and

Permanente

let

Now

has

foundations—strate¬

gic

of

reserves

growing

raw

markets,

materials,
competi¬

Kaiser
est

steel

has at times been disap¬
pointing. Continued leadership on
progress

the

part

of

essential

on

tion

in

the

United

account of

world

affairs.

dence of

backsliding

on

part

your

to

or

States

is

your posi¬

Any evi¬
of failure

accept

the

same

Steel

the twelfth larg¬
company in the country,

by

Henry

With

J.

the
from

veloped
The

steel

last

steel

at

Fontana,

45

Angeles, has de¬
one
of
the
most

in

the

country.

whole Kaiser

Gairdner

%

Steel

the

in

used

West

by

year

was

Far

Western

than

a

$113

were

built into the

original Fontana plant during the
entire war period
1942-1945. v •
And because the country, and
particularly the West, will not
stop growing, and the need for
steel is ever-increasing, we cur¬
rently have under serious con¬

sideration

volving

further

which

expansion

in¬

fourth blast furnace and

a

steel-making

will

First
of

we

...

least

at

double

a

re¬

must

care

share of the West¬

our

growth; and, second, we must
supply at least our share of the
steel

for

needs

In

ore,

addition,

Kaiser

Steel

owre.'

extensive coking coal depoti-

very

its in Utah and
substantial

New

Mexico, and

limestone

in

reserves

Southern California.

These

large reserves of basic
materials, coupled with their
proximity to our Fontana
plant, result in our having what
close

believe

we

increase

facilities
ingot

the

.

the

almost

the

to

necessary

.

to

have

We

.

Kaiser

of
30%

Steel
by
3 million

metal

to

fundamentals

support this

raw

expan¬

material

reserves

the favorable costs of produc¬

delivering

Western

The

164

output to

be

Mountain

miles

the

the

lowest-cos fc

industry.

in

ton

$7.83

Southern

.

our

h\

$13.60 pe>

.

California,

in

ton

per

.

Northern

and

C3I'-

fornia.w
These

fundamentals

Steel's

earnings

among

the

try.

put Kaiser

dollar

sales

per

highest in
r.
;

the

indus¬

For the first six months ending
Sept. 30 of Kaiser Steel's current
fiscal

period, its net income as a
percent of net; sales was about
14%. After eliminating tax bene¬
fits

derived
tax

Industries,
percent

of

from

the
net

consoli¬

filing
with

returns

net

Kaiser

income

sales

was

as

a

about

10%. Cash flow is running at tbt-1
rate of about $50 million per year.
In

opinion,

our

all

of

these

factors provide us with a solid and

market.

Eagle

located

our

in

Utah is substantial

dated

ing and

take

ern

Western

another

sion—our

to

up

sponsibility for Kaiser Steel.

from

mine,

continuing base to meet the chak

Continued

Fontana

on

74

page

now

being supplied from the East and
Midwest.
Two years ago I

sat down with
Kaiser Steel's Vice-

Ashby,
his

General

and

staff

question:

and

"How

Manager,
asked

we

the

The

simple
No.

appeared

answer

1

We

one.

Program

.

.

to

be

the

Conodion

a

established our
not to be the
.

1

US

determined

We

could

and

that

would

be

^

fl.Y.

,jg|

^diated tM

best!

Steel

& '°*

Mills, Spence

sharpen

we

can

ourselves to meet these demands?"

Kaiser
No.

1

in customer relations, in
in

in
opera¬

facilities

sup¬

plants.
adds

This

Our freight advantage over
principal
competitor
located

of the total finished

biggest in the industry—but to be

ex¬

Los

into

320

Company.

rpidst of

tons.

underway since

plant

diversified

Coast.

continuous

program

1945,
miles

West

stock is owned

Kaiser

almost

an

pansion

the

on

common

in the

and

.

the

in

capacity

operates the only fully integrated

plant

expan¬

growth.

Only 55%

West.

hot

phenomenal

and

Steel,

'

oxygen

substantial

a

even

President
Kaiser

and

two

.

of

Jack

aggressive management.

steel

ket, though here, too, the rate of

better pre¬

the

of

are

production facilities haa
been able to keep pace with this

operating cost advantages and

your

.

.

the

averaging 52% Fe, will aver¬
age up to 60% Fe by Spring of.
1957 when we complete our benenow

ly 40%. This single expansion will
place in operation more new steel
producing
and
steel ' finishing

boomed.

has

This

something

you

decade

in

reserve

product capacity by approximate¬

times ifre national rate,
result, the Western steel

a

Not

sion

Cement

tell

me

common

81 % of its

mar¬

as

market

about Kaiser Steel, Kaiser Alumi¬

countries

compete in this

each

40%
and

plied

creasing the opportunities of other
to

are

Steel

million expansion program which
will raise both ingot and finished

the

of

reason

relationship
of
the
raw materials, proces¬
sing and production facilities and
their
proximity to its western

of

Kaiser Steel—Kaiser Aluminum—

the

We

by

industry

and owned by Kaiser Steel, repre¬
the largest known iron ore1

raw

integrated
company's

earnings

stable

other

our

the

begin¬

personnel

factors

in

Actually
our

Its

its

and

provement which occurred, at any
rate

we

growth,

share

We

is unique in the

believe,

I

one-half

"bread

since

trained

started

any

'

our

business

ning in
and

did
with

East and Midwest

result,

a

Midwest.

The other operating division of market.
Henry J. Kaiser Company—Kaiser
To
understand
Kaiser
Steel's
and Gravel—is the largest
position,
you
must
understand
producer
of
sand,
gravel
and some Western statistics.
crushed rock products in the San
The population in the West con¬
Francisco
Bay Area, and earns tinues to increase at the rate of

tive

pace

of these

ficiation facilities.

Supplant

Sand

fast

progress

keep

tion,

States

converter process
steel production.

though

years,

of its exclu¬
United

the

encour¬
num, and Permanente Cement and
made ^in- ^their importance to Kaiser Indus¬
trade re¬ tries Corporation. Each operation

quantitative

particularly

that

interests.

73

sents
some

frustrate

Corporation in Depth

...

in

in

to supply
topnage now
being supplied from the East and

been

progress

strictions,

European

your

policies

your

not

and

Western

maintain

and

a

countries

this,

as

further

of

help

28

page

oxygen

important

Our greatest interest in foreign
trade is reflected in our policies.

import

energy

license

Kaiser

trade.

importance

from

Kaisei

for

Trade

remarks

eign

such

will

the

our

in

subscription

and

—

K

pared today to participate

Continued

Leadership
should

that,

confi¬

every

other fields.

We have achieved

As

offering

to

"

I

world

in

stake

investors

and

objectives. We have come a long
way
towards accomplishing our
other goals.

exaggerated.

prosperity, as represented by your
trade interests, your extensive in¬

holders
many

continuing old restrictions on
imports or imposing new ones.

for

U.

security

and

all

com¬

Canada.
Wants;

reason

a

above

and

over-all political
interests, cannot be

your

taxa¬

abroad

of the stock in such subsidi¬

aries

as

interests

perhaps by

ar¬

subsidiaries

might

countries

vestment

possible tax

American

that

foreign

(2569)

in

growth,
union
our

in

and

earnings,
rate of operations,
human

relations

with

relations—
our

Gompanp Limited

&Co'

stock¬

Milner,

Spc™®®

Bay Street, Toronto, Canada

We provide

a

complete service for corporate

financing in Canada.
dealers

Private enquiries from

are

invited.

Member*
The Toronto Stock

Exchange

Winnipeg Stock Exchange

Montreal Stock Exchange
Canadian Stock Exchange

BELL, GOUINLOCK & COMPANY

Vancouver Stock Exchange

LIMITID

ESTABLISHED

55 KING

1920

STREET WEST, TORONTO
■-*

Affiliate

Gairdner S
60 Wall

T;

Company Inc.

CANADIAN

INVESTMENT

!

i

SECURITIES

Street, New York 5, N. Y.

litember:

The Investment
Dealers'

Montreal

Kingston

Quebec.,,,

Association

Hamilton

Kitchener

London

of Cunuda




Calgary
Edmonton

AFFILIATES

Vancouver

Winnipeg

•ELI, GOUINLOCK & CO.

LEGGAT, BELL, GOUINLQ£K

INCORPORATED

LIMITED

*4 WALL STREET

MEMBERS MONTREAL STOCK 1XCHAIMI

New York

Private wire system

NEW YORK

MONTREAL

The Commercial and Financial Chronicle

74

/.

.

(2570)

minating at the center of a market

73

Continued from page

aluminum

Slates

Corporation in Depth

Kaiser

kets

lenging growth that lies ahead in
the Western steel market.
Aluminum

Chemical

&

the

Corpotation

progress

further

comes,

and

essential

be

in

When

requirements be¬

yond current forecasts.

stock of Kaiser Aluminum &

wheel alone, for

The aluminum

Corporation.

Chemical

will

will raise future

of the com¬

37%

breakthrough

expansion

Henry J. Kaiser Company owns

approximately
mon

Current

is tremendous.

fields

both
Kaiser

fields.

tainer

con¬

The aluminum industry is a fast

tons

exciting in¬
opportunities

than the entire an¬

faster

a

output of our Chalmetfce re¬
duction plant, the biggest in the
States.

the

T h

business

in

produced

and in

1.946,

U.

continue

only

market,

for

annual

billion

share

our

must

we

in

sales

of

of

excess

by

1960

a vera, e

tons—a

a

mo¬

ment, I'll tell you why we believe
this

to

the

be

case.

completion

further

and

With the

foil facilities.

of

this

program,

expansion in the aluminum indus¬

Kaiser

try to

raw

the

essing plant, to fabricating plants
along a direct all-water route ter¬

some extent depends upon
industry's success in break¬
ing into such major tonnage mar¬

Aluminum

can

■

be

river

in

now

will

its

move

materials from mine to proc¬

at

these

factors

among

-

Cement

•

a

growth

Company

system

the

Permanente.

The

of

success

ment

and

sidiary,

under-

Cement

in

its

:

as' compared
250

new*

of

of

Permanente

miks.

due

part

the

to

the

f f*

.

cement

now

plant

initial

an

of

build ng

a

in' Sou.hefn

barrels.

2,500,009

normal

cement plant

a

capacity

There too
material

raw

a

re¬

low cost operation and de¬
livery to market should make it

a

Kaiset "Gypsum,
as
Steel;"' has
been

in

of

serves,

Ce¬

sub¬

formidable

As

phenomenal

competitor in South¬

California.

ern

Kaiser

and

distribution

with,

Company is

combination

Company,

Wholly-owned

California

bulk

marketing-area
of

owns

stock

common

this

California with

Henry J. Kaiser Company
of

Northern

ttie- system. - Permanente's -marketing
area,f with this distribution, has
- • r
been increased to some 3,003 miles

plus

—

of

through

Casn"

great growth industry.

a

30%

Aluminum

Kaiser

of

Permanente

at the Ravens-

mill

operation are
in the industry.

The

trans¬

-

ca¬

Its
the'
Unique in

of

side

States''

currently running

in my judgment, growth
competition in the economy Western

equal,

United

solid base for ouf lifture

a

of the Ravens voocl

rolling

'in "the

sound financial structure—provide*

result of the favorable fac¬

a

outlined

tors

-above, the Comcement
operations Jnave
Immediately prior •pany's
of this mine to market movement.
cons:stently enjoyed a high ratio
to World War II there were 1 iy2
To' cover
the
more
Western millioh people in thfe area. Tcday of earnings to sales as compared
markets,
Kaiser Aluminum op¬ there are over 23;million, amm-* with the industry.
better

of

population

in

the

States.

.

•

erates

reduction

two

plants

and

of

crease'

rolling mill in Washington, and
foil facilities at Permanente, Calif.
Kaiser Aluminum's bauxite re¬

the

a

expansion program
will
increase
our
primary alu¬
minum
capacity by about 35 %,
alumina capacity by about 54%,
and will also provide additional
sheet

for

All

plant will be processed

construction.

producer is

And in

Kaiser Aluminum.

servative.

need

and the output

wood

to serve this
vastly expanding U. S. market—
the world's largest market—than

gain of ap¬
proximately 50% in five years.
These estimates may well be con¬
The

Aluminum

Our current

Industry estimates of aluminum
consumption
three million

this

along

reduction

located

better

any

a

dollars.

is

industry

opportunities.

other aluminum

No

ready

get

will

Louisiana

from

ported

Production

S.

plant, 1 the

.

Located

Better

aluminum output.
Net
sales have grown from $45 million
in 1947 to $330 million—and— if
the

require

is

flow

Or¬

largest in the U. S.

into sheet and foil

primary

we

with

1955 we

the total

of

27%

will

aluminum

e

loaded

aluminum

the

v

costs

Is
in;

and

primary aluminum industry.

.

field

container

200,000 tons!

growth in the past five
has averaged 26% annually.

reduction

world, having an annual
pacity of 8.500.003 barrels.

nave

years

its

New

sales

net

This plant Is
will require the same amount of in'a position to deliver -its finished
along the * Mississ ppl,
tonnage. Even a greater potential products
River- System.
Upon;the
is in sight in die cast doors, tops, Ohio
completion
of
its
Ravenswood,
frames, and hoods.
W. Va. reduction plant, alumina
And just think V
only 10% of
block

engine

aluminum

The

nually, and for the past five years
16.9%
annually.
Kaiser Alumi¬

in

New

s

refractories-

10

Aluminum's- rate of.$70 million per year.

Kaiser

is

leans

Chalrnette

.

started

JxisU downstream * in

indus¬

the rate of 10.5% compounded an¬

We

by three

fed

be

United

Compared with an an¬
nual growth rate of approximately
3% in gross national product, the
United States aluminum industry
since 1910 has been increasing at

years

will

Mississippi,

ore carriers now unuer
construction in Germany.
/
.

grown

try itself.

num's

now

the

than

pace

processing

under construction
at Gramercy, La.
Both plants, ioeated
near
the - mouth
of * the
is

has

and Kaiser Aluminum
at

more

.

alumina

second

A

plant

last

expan-- the

aluminum expan¬ lowest
improved r.frac— Permanente's business are its bulk
tories developed by the company's distribution
facilities
on
liahresearch and development oxganwater which permit the company
izations have contriouved largely to serve markets in Hawaii, Al¬
to its growth.
aska, Portland and Seattle at a
X ;
delivered cost far below any corhIn
1955, K a i s e r
Aluminum*
Approximately one-third
earned the highest percentage of petitor.
net income and cas.i
income on of Permanente's output is sold chitsion.

plant at Baton
one-half of tne

than

less

Corporation

the

paralleled

1,100 miles to iis aiu-

processing

Rouge,

in buik

transported

chemicals and

in

during

haul from South American mines.

nual

growing, dynamic,
dustry loaded with

.

.

carriers

mina

The

sion

mined in Ja¬

is

require ' 250,000 35,000 ton

will

example,

is

and

maica
ore

and

the -automotive

as

sales..

consumption.

bauxite

Kaiser

ated at capacity since 1948, and
now
one
of the largest plants

Chemical sales account for about
4%
of
the
Corporation s
to»al

accounting for 70% of the United

Thursday, December 13, 1956

way

72%,

over

and sail on
California alone

In

up.

Kaiser

a

Gypsum

Kaiser
Gypsum, a who'Iyaveraging about 1,430 -new
citizens every day of the year-^ owned subsidiary of Permanente
serves
in Jamaica are sufficient over 44,000 new people eacn aid. Cement, is one of the two largest
producers of plaster and gypsttrn
for more than 50 years' operation every month. ' Let's visualize ior
at its expanded caoacity and we1 a moment a town of about 40,003 board products in the West. -Upbn
the completion of its current ex¬
are
augmenting
these
reserves population'- with
its
housed"
every day.
schools; churches, service smt'ons; pansion program,' itwill have
public - buildings
and approximately 30% of the produc¬
Kaiser Aluminum has also as- stores;
when we a'dd items lixe-storage tion capacity in the West.
quired extensive coal reserves in
Basic to the company's business
Eastern United States, in^urm., an tanks, sewers, transportation fa-4
its 'gypsum - rock
deposit on
economic energy source for fixture cilities and newflrrdustrial plants; is
San
Marcos /Island
in
etct, you have some idea of Lie
Mexico,
power requirements.
*,tconstruction, going on in the far one
The Corporation
has achieved
y of the largest deposits of
West month in and
month- out. high-gfade gynsum in-the world.
diversity
through -the develop¬
we

are

.

-

-

^

ment of

zS§x
ROYAL

SECURITIES

the

Underwriters

and

.

Distributors

Public

ROYAL

Utility and

Industrial Issues !

SECURITIES

which

—wire—cable—forcings—and ex¬

the

of the

effect

This

new

-

means

more

chemical

Aluminum's

Wesfern

to

tne

sales

cement

the-

dur¬

ore

company.

-

three

in

principal
fast

The
heart

Montreal Stock

company s

low-cost

service

Exchange

—

244 St. James Street
Toronto

Calgary

Halifax

Edmonton

Saint John

to

its

Vancouver

Ottawa

Victoria

Hamilton

Charlottetown

Government of Canada Bonds

4

insulating board business of ~Flr-

Provincial and Municipal

Winnipeg

St. John's, Nfld.

Treasury Bills
,

.

■ ■;

■;

;■

Debentures

f

-

'

■

.

Corporate Bonds and Shares

Collier Norris

&

Quinlan

MEMBERS
MONTREAL
CANADIAN

STOCK
STOCK

Statistical information

on.

Canadian

promptb^'^nslifequest. Orders!

execu

Securities supplied

ted

on

the Toronto

EXCHANGE

EXCHANGE

Stock

Exchange through

Direct

our

affiliate Member Corporation.

private wire with Goldman, Sachs & Co.
30 Pine

Street, New York

■
■

■

|

Collier Norris
Limited

&

Quinlan

Equitable Securities Canada
limited

MEMBERS
The

Investment

Dealers'

Association

Montreal

507 Place d'Armes
HArbour 2201




of Canada

Toronto
320

Members:

Bay Street

EMpire 8-2984

220

BAY

The Investment

Dealers'

STREET

TORONTO, CANADA

Association

4.37

«

ST.

customers.

in
November 4 KaiSsr
Gypsum purchased the wood-fiber
Early

Underwriters and Distributors

West, Montreal 1, Canada

markets,

distr bution

Canadian Stock Exchange

Quebec

the three

Coast

COMPANY

The Toronto Stock Exchange

plants by

of

Members:

X

the

products plants are

the

Pacific

providing
and

cf

carrying ships owned by

gypsum

located

past

Scotia

company's three

bulk

consist principally of
cement
industry V has
increased
the production of basic refractory
31%. '
brick and ramming mixes to ful¬
Permanente built its first plant
fill the needs of the steel, copper,
lead, cement and glass industries in 1939 at the location near tan
throughout
the
United
States. Francisco. 'This plant has operoperations

Nova

Gypsum rock is distributed

the

dams:

five 'years nave in¬
creased 40% while the West Coast

ing

the

is

West.

that is just geU

program

Permanente's

trusions.
Kaiser

1903

Canadian Government, Municipal
c-

this

to

highway

finished products—sheet and ting underway, and the ever in¬
demand* for
kilowatts
plate—foil—containers—rod—tar creasing

CORPORATION

Established

Add

products and through
of fabricating plants

for

Limited
Business

new

addition

of Canada
JAMES

ST.

AY.,

MONTREAL, CANADA

Volume

184

Number 5594

.

.

The Commercial and Financial Chronicle"*

*75

(2571)
Tex

Insulating

Board,

character and to give them re¬ terest/. This statement we like to
sponsibility — heavy r responsibil¬ keep repeating because many still
ities early in life,
v :
- think we' are
operating on gov-

Inc.,

including some 16,000 acres of
tirrrberland in Oregon-and Wash¬
ington.

'

.

Policy

Again the key to the success of
Kaiser Gypsum's operations is its
material

raw

water

transportation

terial

-

low

reserve,

cost

raw

ma¬

market.

*

and

Other
-

"

T wish

about

I

Operations-

had

time

other

our

to

operations

from

comes

ernment money.
Your contribution to

v

you'

Our

and

Boards

independent

even

and

privileged to have his

are

we

confidence

tell

■

friendship,

could

we

of- Directors

withh operation

representation

sure

fields.

again

about

minum,

and

ments

for

Cement

19

They

vital

We

■'

Henry, Sr.-, is doing

to

in

velopment.

I

connection,, with

Waikiki

beach

We

be'interested

in

•*'

,

ulous growth of our

shopping cen¬
are being
partner, Fritz

V*

i

ters in California which
managed

by

our

-

>1

facture." in
the

Company,

we

terested

manu¬

Bristol,

Pennsylvania,
requirements of sinks,

Sears

kitchen cabinets and bathtubs. We
also

are

important

an

1956 the

stainless

steel

fabricator
for
jet engines
guided missiles at our Bristol
plant. You will hear more about

it

Kaiser

fenters

Center

its

in. Oakland

construction

ment

as

phase—

28 story office building for our
general offices and a surrounding

sued
ous

covering eight

'•

"V

Financing

,

:

4

.

Oakland.

bankers

amounted

-

to

ap¬

and

stock' is¬

common

$235 million; and miscellane¬
other

balance.

securities

made

the

up

Of these funds, a total of

approximately $1 billion went into
Kaiser

Management

i

the

businesses

cussing

Early in my.presentation, I told
that the story of Kaiser In¬

story
of
our
founder, Henry Kaiser and of tne
team of

tially

Each

the

men

one

of

operations

our

is

of Mr.

Kaiser.

In

each

lion.

$39

general manager is surrounded by
a team
of people who have had a
terrific

trained

taught

training.
these
us

to

men

of

been

substan¬

Kaiser.

today

reduction

Kaiser Steel's

of

bank

Alumi¬

is

$85

$30
mil¬

loan to¬

confidence

additional
to

fequire-/'

take

of

care

likewise

we are

in

us.

the

of

above

of

figures in¬

government

our

have

good

been

South

La

I

am

somewhat

borrowings
repaid in full with in¬

detail what I have

more

been saying to you today. I think
it will assist in -your understand¬

(Special to The Financial CIhronicle)

CHICAGO, 111.

W. T. McGehee Opens
CLEVELAND, Miss.
William
T. McGehee is
conducting a secu¬

is

with

now

Wellington Finance- Interests is

engaging ;in

ration

Kaiser

and

sidiaries

at 2
Broadway,. New
City. Partners are W. Annis
Wellington and Albert Tucker.

Opens

';■} FT. LAUDERDALE, Fla.—David
S. Hammond is engaging in a se¬
curities business from offices at
3058

der

North
the
thg

Federal

fJrm

Hammond

Highway
of

name

&

James

un¬

David

tions
of

S.' tities

business

affiliated

.

Since 1922

com¬

for

"

Complete Over-the-Counter

market

upon

other

million.

assets,

quota¬

Canadian Bonds and Stocks

$515
earnings

aggregate

Its three months

ending

Sept.

30,

712,000, which
resentative

1956, were $4
believe is rep¬

we

of..the, current

earn¬

Your

of the corporation.

power

value

stocks

common

common

owned

Members Investment Dealers Association

-

607 St. James Street
Direct

West;' Montreal

private

wire

"Telephone UNiversity 6-2463

between

Montreal,

Corporation, was $21.57.
anticipated that the corpora¬

It is

tion's

bank

indebtedness

will

by

be

of

reduced

April

1,

1957

Canadian listed

rea¬

WISENER

cash earnings and the di¬
placement of a new security

Henry J. Kaiser Company and
Industries
Corporation,
the

present bank

COMPANY

AND

-

LIMITED

of

to

specialize in servicing Professional

Investors

$65

to

by

We

$90

KING ST.

WIST
to

T»Uphon«

TORONTO

1. CANADA

—

7211

The
markets

Although the

is owned

company

other

000

is

stock

stockholders

listed

other

stock

American

on

MACKELLAR, WISENER

the*

exchanges.

tion,

know, that through

our

Pitfield

of all

affiliate

and associates in Canada and
extensive

always be counted

for prompt

of

panies.

filiated

pating

on

and reliable service.

,

"

In

Co., Inc.

to

Affiliate—

the

in

develop

executed

on

oil

who

are

y

a

firm of .Investment Consult¬

investment

services

available to

are

programmes.
our

com¬

a

Brawley, Cathers & Company
»

,.

*

«*

«

r

Members

Investment Dealers' Association

Toronto Stock

of Canada
Exchange

factor in establishing,

a

Kaiser

hard

Of
in

Aluminum

working and
can

future

by

our

to

only

be

GOVERNMENT-MUNICIPAL-CORPORATION

cooperation in

your

results

CANADIAN

its

develop¬

can

providing new capital.

of Canada

—

aggres¬

prove

such

course

the

possible with

£4:

Hugh Mackay & Company




Exchanges

Their

clients without

charge.

earn

SECURITIES

We hope
your

con¬

—

Members of ait Canadian Stock

f

stock

specialists in the planning of

tinuing confidence.
Associate

avail-

foresee

or

management

ment

Co., Ltd.

Investment Dealers' A ssociation

We retain
ants

cre¬

new

us

and

worth.

-

be

as challeng¬
Permanente Cement, Kaiser

as

Steel
sive

Members <»f

will

enterprises every bit

where

Pitfield &

the

puts

tinue to be

Street, New York

ing

\V. C.

Building

growth

corporate
strong po¬
acquire new
businesses that don't necessarily
fit
into
our
existing operating
companies!
Thus we can con¬

HAnover 2-9250

Canadian

orders

companies, thus partici¬
in financing their expan¬

addition,

sition

30 Broad

security.

are

sion needs.

Structure

W. C. Pitfield &

we

trading facilities

able to private and dealer clients. Commis-

long-range

been

various Kaiser

our

Actually

quotations on any

Kaiser Industries Corporation in¬
vesting additional funds in its af¬

our

private wire system,

can

entity has

new

a

or

exchanges and unlisted markets.

Mocktllor

1, CANADA

Member i of fb« Toronto Slock Exchange

Corpora¬

ated to assist in the future

Banks, Brokers and Institutions

issues, in

United States funds for

STREET

MEIINDA

TORONTO

CMffir* 3*4911

Industries

or

delivery.

give information

to

sion

Conclusion

Kaiser

In

certain active Canadian

funds

Research and

LIMITED

35

in Canada.

ore

contacts maintain,

the

Telephone

prospects

Complete files

companies.

Canadian industrial, oil or mining

,

and

the securities of

Mackellor, Wisener limited will be pleas¬
ed

22,-

and

the

on

are

Statistical De¬

our

to

Trading Department quotes firm
on

United States

approximately 95% by the KaiStr
family, Henry J. Kaiser Family
Foundation,
and
certain
close
business associates, there

by

Professional Accounts.

ed with such

of Tha Inveitmen! Dealers' Association of Canada'

placing blocks of

companies believed to be of interest

kept and continuing field

EMpira 3.
6204

Members

or

over-the-counter securities.

Trading Dept.

"€Mpk» A
3231

or

is confined

partment
certain

73

by obtaining

Research activity

Canadian

variety of information

Toronto

Kaiser

by

Industries

subordinated

a

of Canada'

The

share,
based upon market quotations at
the
end
of
September
for
the
per

Inquiries Invited

Kippen & Company, Inc.
■

ing

Brokers and Dealers

■">-

loan.

inviting growth

offices
-

Service for

its

Kaiser

for

from

North Main Street.

A

holdings at the end
September, and book values for

all

of

upon

McKnight Opens

KALISPELL, Mont. — James B.
McKnight is engaging in a secu-

'

Co.

its wholly-owned sub¬
of Sept. 30, 1956. Tdtal

as

assets, based

son

called

securities business

a

from offices
York

are - reflected ; on
the
balance sheet and operating.state¬
ment of Kaiser industries Corpo¬

rect

we are

"*/■;,r

.

panies';

million

Every day

•

Wellington Finance

Dempsey-

Tegeler & Co., 209 South La Salle
Street.
1
*

1

••

*

Francis A.

—

Industries Corporation.
Its direct
operations and its interests in the

various

Rj

Joins Security Planning

CANADIAN

BANK OF

COMMERCE

(Special to The Financial Chronicle)

WEST

PALM

EMPIRE

BEACH,

Security

Planning,

Inc.,

3-5821

Fla.—

Harry Carp is .now associated with

-208

members

Stock

ing of the various Kaiser com¬
panies—and particularly Kaiser

million

knows Canada

Street,

Midwest

rities business from Offices in the
Somerville Building.

joins Dempsey-Tegeler
Peferson

the

Salle

—

David Hammond

Kaiser- Industries Corporation

asset

million.

None

Henry Kaiser

select

refunding.

clude any government borrowings
—and may I emphasize that all

Responsibility

men.

in

day is $13,650,000—a reduction of

the

case

have

bank-loan

million-^-a

headedby a Vice-President and
General Manager and in each case
he has been a long-time associate

various

reduced.

num's

dis¬

About $300 million

loans

Bank

he built around him.

been

you—principally

in

used

were

is

with

have

I

facilities.

new

you

dustries

you

?r

aggregate financing from

preferred

in the

acres

Salle Strfeet.

105

associated

Webber-Simpson & Co
La

■'

D. Mc-

G.

with

deeply grateful to them for their

J

proximately $1,300,009,COY Of this
total, bank loans were $542 mil¬
lion; mortgage bonds $430 million;

a

of

.

institutional investors and invest¬

center

heart

'

banks, insurance companies, others-

and

our

■

affiliated

riow

become

Exchange.
was
formerly with Detmer &
Company.

Mass. —-"Wallace

is

Blair Sc Co., Inc.,

in
taking the liberty of of¬
financing required to' accomplish fering to each- one of you as you
the things I have been outlining leave this room a copy of a booklet we have prepared covering in
to you.
For the period 1945 to

Bujrns. In partnership with Sears,
&

*

.

BOSTON,

am

funds

with

has

He

Blair Adds to Staff
(Special to The Financial Chronicle)

talking with

be

Farnale

of

Nyweide

chrofei)

CHICAGO, 111.—Gordon

South

co-

in their fields and

or-

that you would be in¬
the magnitude of the-

sure

am

~

Roebuck

_

r

•

v;, f: "4- r, /

.

-

Kaiser
'

>

the

building depth in ouA

are

V 4

the

are

ganizations!4

hearing the fab¬

4 ; C.

will

we

(special to The Financial

La Salle Street,

I

assistance.

^

.With Webber-Simpson

CHICAGO, 111 — Johnathan B.
Harding and Robert L. Hylard are
now With Bache & Co., 135 South

are

keystone- the future expansion we foresee.
management de^ The banks and institutional, in.-;

is

We

BoaTas

success.

that

had

only as strong ' Vestors'participating in this fipeople—and believe^ me, nancing include the finest names

our

as

resort

likewise know you wb'uld

our

future

our

working

are

to

consider

would be fascinated

acre

hotel.

I

you

Honolulu

his

Gypsum.

what

to hear

in

and

have

not

and

strong, able, men, the tops in their

Sure

«■-

earnings-which our industries
have enjoying today without your"

though they are • over-shadowed
by -comparison with Steel, Alu¬
am

»

-

tidewater
plants, and
low cost distribution to the West¬
ern

direction

Henry, Sr., Edgar Kaiser, Henry'
our growth
Kaiser, Jr., our financial adviser, has been great, and we are deeply
George Woods, and me. During grateful for your confidence in
our
period of expansion - George us. * We fully recognize that we
has been an integral part of our Could not have had the
major fa¬
top team. His contributions to our ' cilities, we could not have had
success
have
been * 'inestimable the production and. -sales
volume,

to

of

Two With Bache
(Special to The Financial Chronicle)

.

TORONTO

Harvey

Building.

\

BUILDING

at 88

76

The Commercial and Financial Chronicle

(2572)

•

Continued from page

the

41

tices

attending

depletion

allowance."

economists,

economic

interest

ecutive

determinable
dollar

the

well

in

was

That

at

and

oil

the

payment

can

to

and

80%

bank

volume

Mention

creasing

has

tax

been

in

by

an

in

this

of

will
as

related

be

in

transactions

ness

practice
in

is

of

ordinary

and

to

ex¬

physical

observer

any

fluid

as

state,

reconcile

to

for

and

him¬

privileges
industry, he must consider

of the
the

fact that

intangible

oil

is

comparative

a

commercial products

as

go.

some

de¬

_

the

Element

No

one

of

be

can

certain

given quantity of oil, and
be

can

tion

exact

an

all

rate, for

produc¬

the

upon

geo¬

logical
nature
of
the
oil
in
place, and not entirely upon those

picture, in relation
and taxation, exists

as

manufacturing is complete; how¬
ever,
over
the oil he produces

problem

the

producing it.

endeavors

create

when
any

dealing with

agony.

difficulties

insidious

a

to

"pat"
formula
for
oil. In view of the

which

the

of

cause

one

business
dilficult

may

very

arise

character

be¬

of

oil, production of oil, or the buy¬
ing and selling of oil properties,

control

of.

In other words, the

man

man's control

automobile

over

however, to
Because

sions

ital

the

oil

treatment

from

he

cap¬

the

will

$2

receive

By the oil pay¬

ment

stands

A

route,
of

his

obtaining

good

a

larger

a

sum

quired
faction

purchaser's

more

with

money

Let

debt.

the

in

us

say,

hy¬
transaction agrees to
lend $1,400,000 at the rate of 5%
per annum on the security of an
assignment of the runs from 80%
of the production from the lease
and that C, the company that pur¬
chases the oil payment for $1,400,000, plus 5j/2% interest, acquires a
spread of l/z%.
With the essen¬
tials of the transaction completed,
B has paid $600,000 for the pro¬
ducing properties, along with, of
our

pothetical

actual

which to

property

of

the lending institution

property for the payment
any

only to the runs
for the satis¬

look

to

the

from

deal.

the $1,400,000 oil payment
paid out of 80% of the runs until
A shall have received the full $1,-

course,

400,000.

A,

simultane¬

however,

Upon the sale of the reserved oil

ously with the closing of the deal,

payment A

has

full

seldom
in

has then received the

asking price for his property.

It should

be stated

has

finding

payment,
have

here that very

A

any real difficulty
purchaser for his oil

a

for

been

today

corporations

conveniently

brought

into

existence

pose

5V2%

plus

for

the

$1,400,000

interest,

to

payment,

C,

which

then executed its note for $1,400,000

the

to

interest

lending
the

of 5%,

ance

its

on

with

agency,

unliquidated bal¬

retaining, of

course,

y2%.

of buying these payments.

just

the

sold

pur¬

Results Obtained
This transaction has the follow¬

Lending

Agencies in

With

Connection

Transactions

minated,
bank

a

or

lending
an

approached

agency,

usually

insurance company,

for

ing results: A has realized the full

consideration,

$2,000,000

Before any transactions are cul¬

the purpose

of

was

which

his asking price for the prop¬
and
has
been
treated on

erties

capital gains

as

if he had sold his

property outright to B for $2,000,-

be

cannot

in

Revenue

through the sale.

is

problems that
always exist

provi¬

present

Internal

proceeds

chance

a

or production capacity, is
somewhat of an impossibility. Tod

unforeseen

oil payment.

the

the

gains

million

istence,

these

of

an

of

Code, A would be entitled to

relatively incom¬
plete, for though he understands
its nature and is constantly de¬
veloping more effective means for
discovering and producing it, to
be absolutely
certain of its ex¬

many

could

not purchase the
price, operate it, and
then still realize any substantial
profit. Faced with this problem,
B accordingly proposes to A that
he, B, will buy the lease subject,

is

foreseen

he

lease for that

Thursday, December 13, 1956

finding out how much that insti¬
tution would lend if they were re¬

cash outlay, thus leaving him with
a

one

this depends to

extent

great

a

of

sure

of

no

peculiar nature
of the oil industry, the whole oil

to

that

of his tax position, he knows

reduces

Uncertainty

that the
million, but, be¬

structure,

lease is worth $2

for

The

tax

present
cause

in

the self-same product

as

its

are

self to oil practices and

development

follows:
of

techniques,

terms

amine it with any concrete policy
is making a mistake.
The nature
of the oil industry and its busi¬

financing

gas

this paper.

Because

has not been
As a result
development
has
taken
place; creeping,
step
by
step, it has blossomed to arrest
quite alarmingly the attention of
alone

field

in

dollar

typeas discussed

or

tail

industry

petroleum

and

oil

the

and

in¬

of

True,

in

annual

Since then the sit¬
uation
has
been
reversed; type
"B" is the predominant procedure

conditions

made

in

reserved

Until about

approximately

ago

bank's

a

drilling,

Payment

pressure.

of

was

changed and this is not the
type of oil payment we consider
significant today.
Oil

the

where

is

years

until

have

Reserved

this

and

seven

financed

be

,

times

and
time,

it

financial

a

common

high,

been for some
might be more profitable
buy rather than to explore,

that

financing,
although
even
today
this practice is utilized to a lim¬
ited degree, inasmuch as the oil
banks.-But

by
so

now

oil payment comes in.

commercial

of

is

discount.

prevailed

which

advent

of

judged

as

ex¬
find¬

of

cost

perhaps has

payment was

the origin

oil,

The

complicated
To treat the industry

business

statisticians, and

talent.

standards,

the

once

reasonable

a

was

practice
the

ing

a

the

of

excess

risk

contractor's

salable

represented

in

cost of the well.
This
premium paid for the

turn-key
was

fee

amount

or

gov¬
prac¬

numerous,

vague.

taxwise

Gas Securities Committee
Such

are

and

of

aurh

an

uniqueness.
Rules
erning the industry and its

Report of IBA Oil and Natural
an

industry acquired

relative

.

.

.

oil,

but

difficulties

in

industry

resulting from
the very nature of the product, do
not, necessarily, exist
in other

each month of the

forms

try

Canadian economy
Monthly, the B of M's Business Review
ports and interprets for
nomic
as

they

or

Head

are

you

Canadian

and trends. To receive

news

published, write

any

re¬

eco¬

copies

U. S. office

Office, Montreal.

business.

of

The

laws

which

controls

tions

tion

arise.
of

-

-

-

Because

the

forced

of

the

UNDERWRITERS

Montreal

oil

To

Government, Municipal, Corporation,

cated,

delicate

due

the

to

Religious Institutions.
221

amounts

often

change

Quebec

Treatment

Tax

St.

BRANCHES

ACROSS

This

Office:

CANADA

in

itself

problem,
RESOURCES

•

STREET, WEST

MONTREAL

I

San Francisco —333 California Street

CHICAGO: Special Representative's Office, 141 West Jackson
Blvd..

875

NOTRE DAME

hands.

84 Wall Street

'iPmxC

Commissions, Parishes and Fabriques,

in

compli¬

large

which

money

and

School

effi¬

business

transact

both

is

function

to

DEALERS

AND

Province of QUEBEC

r

simultaneously enabling its busi¬
practices

C2.

Specialists in Securities Originating in the

posi¬

industry, it has been
protect
itself
while

to

^

LIMITED

intricacies

the

all

L. 6. BEAUBIEN

system

complexities inherent in the
Law
industry is most difficult.
governing oil is always changing
as different, unprecedented situa¬

of
New York

contradic¬
any

and

ciently.

of

often

tory; but to formulate

ness

Bank

governing the indus¬

varied,

are

EXCEED

$2,700,000,000

is

such,

as

real

the

not

but

rather

Cttawa

Hyacinthe

Trois-Rivieres

Shawinigan Falls

Paris

the

Sherbrooke

Brussels

taxation issues related to the large

situations

monetary

arise

that

from the transfer of valuable pro¬

ducing properties.
Internal

The Bureau of

both

Revenue,

in

the

Code and in its rulings, recognizes
certain tax treatments applicable

only to the oil industry.

OPPORTUNITIES IN CANADA

effective

ably from
tained

Our facilities
in

the

can

industrial

investors

in

be of valuable assistance to those interested

development of Canada and of benefit

selecting suitable investments through which to

the

utilization

&

Hart

inc.

of The Investment Dealers'

Association

of Canada

the

of

the reserved oil payment.
two

serves

does

it

purposes,

protect, to

those connected

participate in Canada's assured growth.

Members

production payment, better known
as

to

oil

made

profit¬
tax standpoint is ob¬
can

a

by

be

Savard

The most

whereby

means

transactions

of

producing

a

This

for not only

230, Notre Dame Street W.

large extent,

with the

transfer

properties

MONTREAL

taxwise,

but it also enables the transfer, or

Nesbitt, Thomson

and Company

sale, to

be made, for it substan¬
tially reduces the actual cash out¬

lay

Limited

by

ties.
Members

of

1 Ire

Investment

Head Office:

Dealers'

Association

355 St. James Street

of

Canada

W., Montreal

the

buyer

of the

1 • ►

proper¬

SavArd,& Hart

Without the oil

payment, the
buying the properties, for
instance, probably would not be
party
able

afford

to

to

the

pay

Members: Montreal Stock Exchange
Canadian Stock

asking price in cash, and thus the

Branches in the principal Cities of Canada

transaction

place.

To

could

illustrate

Exchange

useful¬

Head Office:

230, Notre Dame St. W., Montreal

oil payment, and to
significance, if not neces¬
sity, in the world of oil, it would
ness

Slock

take

never

the

Exchange

Toronto

entire

the

of

show its

Nesbitt, Thomson
25

Broad

Company, Inc.

Street, New York 4,

Telephone HAnover
140

and

2-8875

Federal

N.

perhaps be best to create

Y.

Teletype NY

retical

1-4358

Street, Boston 10, Mass.

what
In

so

most

oil
,

New

York,

Direct

Boston,

wire

connections

Montreal,

transaction

theo¬

and

Branch

40

Hamilton,

City

see

11

part the oil payment plays.
we will illustrate the

King Street West, Toronto

doing,

popular

payment,

use

of the reserved

the A-B-C

transac¬

QUEBEC

—

TROIS-RIVIERES

ST.

tion.
Ottawa,

Offices:

Exchange Place—65 West 44th St., New York

JOHNS,

P.

Q.

—

—

THETFORD MINES

between

Toronto,

Kitchener, London (Ont.), Winnipeg, Calgary and Vancouver




oil

a

SHERBROOKE

—

CHICOUTIMI

DRUMMONDVILLE
—

MIAMI BEACH

Example of Reserved Oil Payment
Let
oil

us

lease,

suppose

which

that A
he

is

sell for S2 million cash.

owns

an

willing to
B, a pros¬

pective buyer, feels, except for the

SAVARD &
Geneva,

HART S. A.

Switzerland

SAVARD & HART LTD.
London,

England

77

Volume

Number

184

15594

.

.

.

The Commercial and Financial Chronicle

In B's case, he has actu¬

000 cash.

So

credit.

credit

this

that

based

return

may

cost

on

used

was

cubic feet of natural gas was pro¬

principle re¬

to

During the last 10 years, a major

expansion in use has occurred, as

produced by the pipeline company
as
compared with that produced

trillion

and unrea¬
sonably depressed gas prices
which would result in accelerating
consumption and discourage dis¬
covery and the discouragement of
gas production by pipeline com¬
panies thus increasing their de¬
pendence upon purchase of gas
from others.
Shortly thereafter,
however, the Circuit Court of Ap¬
peals of the District of Columbia

period,

1951-1955, net production
totaled 45 trillion cubic feet, but

witnessed

again only 38 trillion cubic feet of

interstate

additional

was one

year

finances the sale in the

of

this, B is able to buy the prop¬
erty and realize more profit than
if

had

he

property

buy

to

the

a
100% cash basis.
period of payout, B

on

the

During

able

been

the
a

little, if any, tax to pay in
connection with his interest in the

which

have

paid

property. "C
the

oil

cost

$1,400,000 for
with 100%
has the 5 V2 %

payment, and

he

depletion

interest

rate

income.

taxable

as

the bank,
so C
only has the Vz% spread as
taxable income, which is the dif¬
5%

However,

between the

ference

ried

to

goes

by the

interest car¬

oil payment and the
lending

interest rate at which the

As

Acts

Important Key

an

transaction,

This

above, is relatively simple; but a
real transaction cf this kind is ac¬

by much painstaking
To incorporate a descrip¬

companied
effort.

analysis of the detailed
in this type of
only complicate this
report, and most likely be inap¬
plicable to an examination of the

tion,

or an

effort

necessary

mechanics

or

the utilization of an

oil payment, as
of transaction.
energy

agency

worth

\

such, in this type
Nevertheless,

the

spent
by
the
lending
in evaluating the present
of
the
property
against
lends

the.

of the

part

ever,

the real key which opens the

door

and

enables oil operators to

property prof¬
itably is the reserved oil pay¬
ment.
This payment turns doubt¬
fulness into plausibility in con-r

transfer producing

producing

r.ection with the sale of

and

properties,
the

oil

whole

fited.
As

•

of

because
industry

this,

is bene¬

-

for

the

credit

requirements

pertaining to the reserved oil pay¬
ment, they are basically the same
as those surrounding a direct loan
to the

to

payment.
may

"carved

out" oil

Heretofore, an operator

have created through

during
cient

the

his

taxable year

drilling
a suffi¬

chargeoff to establish a tax

its

the

mission,

oil

price,

major banks today have an
of the

did

findings

merely

not

at the

sent

stating

princi¬

good many of the pension and en¬

not

record, and that the whole matter
should be re-examined. The Fed¬

Most of the major

at these loans.

oil

companies

set up to look

are

use

eral

of their

some

sources

•»<

#

tion

decisions

and

Federal

risdiction

legisla¬

affecting

the

Commission's

Power

ju¬

the natural gas in¬

over

to place our
true economic perspec¬
tive. The principle of jurisdiction
over the natural gas industry was
is

dustry

topic

necessary

in

practiced

regulation

Federal
is

and

method

but the rate-base

direct

a

regulation

Company,

having its own gas re¬
as Panhandle East¬
ern,
was
no
longer in a better
bargaining position with respect
to purchasing gas from indepen¬
dent producers
(a status which

a

company

such

serves,

would be encouraged if it were to
receive
such

supply

field

fair

the

price

Panhandle

case

when

exhibited the idea

price"

field

"fair

a

but the largest con¬
continues to be for in¬

one-half

that

still

is

It is noteworthy
natural

the

of

in

consumed

gas

state

the

where it is produced.

1960.
In
at this rate by
by

These

facts

are

be¬

significant

25% of present reserves or an ad¬
ditional 56 trillion cubic feet. Fur¬

trial market.

ther, this would mean the devel¬

he

gas

cause,

production during the next
must approximate 57
cubicfeet.. This would

1960,
five

years

trillion

the

mean

required

.

of

113

of

reserves

new

of

addition

the

at

record

contract

the same

trillion annually,
new

This is true because
Federal

avoid

can

not tie himself

trillion cubic feet in the five years

up

for

still

and

regulation,
a

long life

obtain

goad,

a

price.

**

develop¬

ment of 22 trillion in 1955.

One must not overlook the
vate

estimates

recoverable
500

reserves

within

trillion
or

to

725

The

the

doubtful

whether

cubic

trillion

times

many

rate of withdrawal.

the current

However, it, is
of these

either

figures will be approached with¬
out the necessary

courage more

Situation

The Canadian

pri¬

ultimate

of

States, which range from

United

feet,

made

incentive to en¬
intensified search.

with

regularity

"

wh'ich

the

exploration, development and
production divisions of the Cana¬
dian
petroleum
industry make
discoveries and shatter their pre¬
vious

records
continues to
widen the gqp between maximum
efficient recovery
and
markets,
in

drilling

Western

efforts

strenuous

divisions

sales

other

and

Canada,

the

despite
the

Selling Gas Locally

Circuit

that

feet

now

marketed

the

of

dustrial purposes.

espe¬

necessary,

customers

commercial

sumption

rapidly

as

for

apparent reasoning behind
Court decision in the

The
the

feet

given
the
present
un¬
settled atmosphere and the threat
of Federal regulation all the way
down the
line, the producer is
more
and more disposed toward
selling his gas to the local indus¬

gas).

to

.

find

parative

outlets.

It has been estimated that

Over

the years
changes have before the end of
1956, the max¬
place, both in the consump¬ imum
permissive rate of production of gas and in areas of sup¬
Continued on page 78
ply. For some time Southwest gas
taken

cost of

projects

This concept was based on
depreciating capital investment
with a modicum of risk, two fac¬

erty.

have

also

should

has

Court

now

shown

been

as

The Supreme

basis for decision.

a

been asked to re¬

the Panhandle

and its

a

view

tors'

decision, expected late this year,
will be highly significant in es¬

which

not

are

readily

the

within

certainable

as¬

producing

segment of the gas industry. How¬
ever,

this

utility

cost

reasonable' it is the result reached
the

method

which

employed

controlling."
Cost Applied to

on

Gas

This
in

rate-base

Federal

Power

thinking through 1954.
Commission
its

Last

changed

approach and in the Panhandle
that the rate of

year

prices

gas

in

in NEW ENGLAND

Demand

when

cubic

trillion
was

feet

total of 10.1

a

of

natural

gas

produced in this country, es¬

serves

for

than 100 YEARS

more

recoverable re¬
stood at 223.7 trillion cubic

timated

proven

feet, indicating a 22 year supply
at the present rate of withdrawal.
The number of year's supply has
30

declining gradually from a
rate during the 1935-1945

year

The

latest

reserves

that

A.

G.

A

figures

and production

15 STATE STREET, BOSTON

on

Boston

point out

period,
total of 30 trillion

a

Telephone LAfayette 3-2400

Boston

during the five year

1946-1950,

CO.

ESTA BROOK

period.

Then, the

drastically

decision charged

Supply and

been

existed
Commission

method

natural

the industry.

service

of

approach
received judicial ap¬
proval in the Hope case when
Justice Douglas said: "Under the
statutory standard of 'just and
not

tablishing

case

Hartford

New York

Teletype BS-288

Providence

Poughkeepsie

Springfield

Members New York and Boston Stock Exchanges
ESTABLISHED

1833

UNDERWRITERS and

Townsend, Dabney <Sl Tyson
DISTRIBUTORS of
■

•

•

Established

1887

V

,
4

'.

"

4

Members

GENERAL

MARKET

MUNICIPAL BONDS

New

York

American

30 State

and Boston Stock

Stock

Exchange

Exchanges

(Associate)

Street, Boston 5, Mass.

BOSTON
Specialists in Bonds of

Municipalities

within Massachusetts

UNDERWRITERS

AND

DISTRIBUTORS

OF

CORPORATE AND MUNICIPAL SECURITIES

ROCKLAND-ATLAS
NATIONAL




Main Office: 30

MEMBER

BANK

BOSTON

Congress Street, Boston 6,

FEDERAL DEPOSIT

INSURANCE

CORPORATION

Mass,

of

new

.

presented, the com¬
service schedule

their

was

Government prop¬

on

States Su¬

Petroleum

Phillips

electric

interstate

of

was

that as

Court decision with respect

preme

schedule

of

result

utilities and hydroelectric
constructed

the

by

Commission

Power

adequate

an

stated

of the United

result

legislated by the Natural Gas Act
1938

They also

reason.
a

this

believe

not

did

Situation

of the recent

review

A

order to

fiably low prices), but the Court

to

The Natural Gas

cubic

rate

7

«

trillion

or.22

checked
by independent
by the lender.

seem

gas

cially in the face of an indicated
annual demand of more than 12

opment

his properties, which will like¬

be

em¬

would

making them available at unjusti¬

event, the borrower must
furnish authoritative engineering
ly

had

the

as

phasized the argument of conser¬
vation of natural resources (not

any

on

Commission

Power

in

supported

adequately

of natural

gas

production,

suggest

failing to uncover new

we are

sources

of

trillion cubic feet in 1945,

one-third

use

two comparisons

These
that

average annual
Whereas

an

transportation

approximates five trillion
annually.
Residential

now

and

Sources

Gas

pre¬

dowment funds

were

stockpile.: it

national

our

by

rate of increase of 10%.

Falling Behind in New Natural

pal arguments advanced for using
such a
method of pricing were

larger insurance companies, and a

added

was

reserves

gas

to

a

feet

cubic

the

the

that

cubic

added

case
Federal Power Com¬

the

time

same

reserves.

field"

"fair

the

of

use

but

back to

department.. Several

Rates Based

Payment

in

and

ap¬

Most

Finally, another form of avail¬
able financing is that which is ap¬

plicable

would

banker

gas

decision

Panhandle

the

reversed

clude

is

operator.

Carved-Out Oil

appar¬

which the

proach with an "oil payment" or
"production loan" must perforce
be
a
"knowledgeable"
lender.

of

the

money,

„

foregoing, it is

investment

possible sale later of
payment to someone
else,;all goes to illustrate the pos¬
sible, if not inevitable complexity
of an A-B-C transaction.
How¬

-

'

;

that the institution

in

it

credit.

From the

necessary

which

offers

1954

Conclusion

would

deal

of

provision against this

carry over

excess

In

outlined

as

Code

pension, retirement and employee
thrift funds in this type of paper.

loaned the $1,400,000.

agency

procedure,

Revenue

ent

taxes

runs

same man¬

oil payment.

reserved

between

by others, arbitrarily

however, should
become less utilized, inasmuch as

only 'on 20% of the
apply to his working
interest. This 20%, in most cases,
would probably just take care of
operating expenses, and he would
pays

the

as

ner

This

discrimination

able

subject

of pro¬

For the latest five year

the
oil; payment ' is
producing properties for $600,000," question,
to a $1,400,000 oil pay-; "carved out" and sold from pro¬
duction in an amount to approxi¬
ment, plus interest and taxes, pay¬
this
credit.
The
bank
able out of production.
Because mate

ally acquired $2,000,000 worth of

the

during

point

net total of 38

sulted in arbitrary and unreason¬

lost

the

near

duction," either in field operations
or
in local industrial activities.

States, while

duced in the United

in

be

not

AUGUSTA, ME.

BANGOR, ME.

LEWISTON, ME.

GREENFIELD, MASS.

PORTLAND, ME.

KEENE, N. H.

FITCHBURG, MASS.

LAWRENCE, MASS.

MANCHESTER, N. H.

?8

The Commercial and Financial Chronicle

(2574)

Development

of Nuclear Power

Electric

Report of IBA Oil and Natural

Name of Organization

Duquesne Ligni

is

established by the Con¬

as

year.

Production

Rapidly Increasing

1955

crude

The

refinery

Montreal

Co.

Status

Date

•ajng

PWR

60,000

•

Cat.

1957

Sodium

7,300

Graphite

Construction

haff

1957

Construction

almost

Construction

permit

Construction

Santa Susanna,

Power rveat.or i/e.en.p.Mciu uu.

(The

Detroit

started

100,000

Edison, et al)

Fast Breeder

•

1960

134,000

PWR

1960

236,000

Monroe, Mich.
Rowe, Mass.

Yankee Atomic Electric Co.

PWR

Under Independent Industrial Program
Consoudateu

~;*r*

completed.

completed.

Construction

Point, N. Y.

Thorium-Uranium

w.

oi

>.

niuian

Aug.

8,

1956.

signed June

Sp-ing of

start

1956.

1957.

1960

Nuclear

Power

Pacific

Gas

Dresden, III.

Group*

&

Electric

Co.

Livermore,

permit issued May 4, 1956.
Construction to start Fall of 1956.
Construction

permit
to

Construction

permit

Construction

180,000

Boiling Water

1960

5,000

Boiling Water

1957

Homogeneous

19B2

Cal.

Construction

Pennsylvania Pwr. & Lt. Co.

Central

150,000

Eastern, Pa.

Research

Florida

Stated

Not

200,000

1962

"To

be

owned and

start

issued May 4, 1956.
in early 1957.
May 15, 1956.

issued

1956.

in

start

to

in

Detailed design and
in 1958.
Various
reactor
types
under study.
Type
design to be determined by 1958.
struction

market

of 354,000 barrels area of 200,000 barrels daily has
During the first half of yet to be tapped. Hopes of new
markets were raised at the be¬
1956 production was 78.3 million
barrels, or 430,000 B/D.
It is ginning of 1956 by the initial
estimated that production for the tanker shipment of Alberta crude
Vancouver
to
California.
full year will be 165 million bar- from
Further
shipments
have
been
j^els, or 451,000 B/D, with ap¬
proximately
87%
of the
total made, but for the most part they
were experimental and in tankers
originating in Alberta. Well drill¬
that would otherwise be returning
ing operations in Western Canada
continued at a record rate, with empty from the Seattle area.

to

K,
1956.
6,

issued. Aug.

AEC

with

Contract

Construction

tai.un

Converter

average

an

or

zmippuigport, Pa.

u>.

California Ed.

Florida Nuclear Power Group

work.

development

production in
totaled 129.5 million barrels,

Canadian

is

competition with oceanborne
petroleum very difficult.
In
short, the major problem of
the Canadian petroleum industry
is the finding of markets for the
rapidly increasing production po¬
tential before the lack of same
tends to retard exploration and

prairie provinces,
will be ap¬
proaching a million barrels per
day; an increase of roughly 2U0,000
barrels per day during the

Type Reactor

Capacity

.

Under Power Demonstration Program

which

handicap

natural

a

Southern

making

three

the

of

Boards

Project Location

Plants

Est. Oper-

Under Go/ernmen* Experiment! Program

Gas Securities Committee
servation

Thursday, December 13,1956

.

Investor-Owned Electric Utility Participation in

Continued jrom page 77

tion,

.

.

progress.

to

con-

proceed

and

operated by Commonwealth Edison Co.

daily.

1,289 completions in the first half
of 1956.
Of this total, 952 were
oil

54

dry holes.
may

gas

concentration

flow

result of the Suez
Canal situation could materially
stimulate Western Canadian cruae
sales.
With the introduction of

development

on

drilling, particularly in the Pem¬
bina Field
and
in Southeastern

and

from

decline

its

The

on

combination of the success

a

stiff

tariffs,

drilling.

as

however,. with
low
shipping

super-tanker,
exceptionally

the

the moderate
1955
in "wildcat"

Saskatchewan,

interruptions
of the
of Middle East oil to North

America

competitive

pricing

Atlantic Coasts

the Pacific and

of

exploration in Western Canada
in the post-Leduc discovery pe¬

is

riod; the presence of representa¬
tives of major oil companies of

troleum, both as a whole and on,

North

America

Western

and

a

likely to return.
Canadian consumption
per

idly.

Eu¬

vances

been

and the weight and

of

pe¬

of

the

Western

Canadian

-

of

Canada

and

the

United

States

areas

crude
of

are

the

states and the

been

disappointingly

line from

the

River region

Peace

International

the

to

tion.

Corpora-

Trans-Canada

of

to

Limited

through

Montreal

have

the Canadian

pipe
to

been

Pipe
irom

gas

Toronto and
approved by

Legislature.

Assist¬

is to be provided by the gov¬

ance

pipeline
Ontario

also

It

made

who

line

Alberta

the

from

leg

This line

being laid. The company
plans for the sale of gas to
Tennessee

now

Transmission

Gas

Company at the Manitoba border.
Such
plans are pow under con¬
sideration by the Federal Power
Commission (U. S.).
in

|

important change
in

1956

Act

natural

COLORADO

Teletype:DN

>

296

made

was

Canadian

the

Income

applicable to oil and

as

companies. The new
regulation provides that where an
oil or mining corporation acquires
the property of another oil cor¬
poration, it may deduct certain
t drilling and exploration expenses
I pertaining to the properties ac'
quired which had not already
been

gas

in

exceed

(

at the time

deducted

purchase.
tions

the

ing that
acquired.

the

However.,
one

any

year

income

•

ly date for the generation of
unsubsidized

with

er

is 1959

pow¬

atomic fuel

I960.

or

Sponsored by members of Con¬
the

associated

generally

gress

with

public-power movement,

siderable

con¬

support was given dur¬

ing the last session of Congress to
a

designed

measure

Federal

to

Government

six

operate

Although

plants.

have

this

and

utility

legislation

failed to pass, it is expected to be
fssue in the coming session.-

an

seems

believe

of

the

that

unsubsidized

sub¬
con¬

atomic

.

fuel plants

will be slow and grad¬
and that they will not displace

ual

existing systems, but instead will
supplement the nation's integrated

facilities

in

date

the

electric

dustry has been the
dramatic
to

of most

source

announcements

relating

Consolidated Edison of New

York

Chicago each

a

large

without
the

Edison

Commonwealth

and

of

to

propose

nuclear
financial

build

station

power

assistance

from

government; and the Yankee

Atomic

Rowe,

Electric

own

Company

Massachusetts,

construct
its

utility in¬

the peaceful use of atomic en¬

ergy.

a

Since the

is

try

of
will
plant at

also

nuclear power

cost, though the AEC will

contribute to research and devel¬

opment costs and will lend certain
other assistance.

addition

to

these

plants, several others
ous

The

attached

fuels

let

pected,

usi

field '-in

1 be

may

derived

the

mean

less than

loss of

the domestic crude
than

less

volume.

terms

oil—the

the

by-product,

item

profitable
for

in

Not only

fuel

ual

that

than

less

3%- of

and

run

of

even

dollar

that, but resid¬
type used—is

the

crude

which it is derived.

from

oil

Approximate¬

used

projected

are

to

percentage

er

placed

crude
be

would

quote

power

sup¬

plied by Edison Electric Institute

still

on

energy

loss

v/ould

amount

the

to

barrels

1975 to 170,1.3% of the
demand; to
industry the loss
or

domestic

natural

gas

under the same conditions

in

1975

is

estimated
or

Some

400

at

2.7%

demand. These

of
are

million

chbic

the anticipated
trifling losses."

concluding thoughts: The

Navy Department recently stated
that

the

advantages

experienced

not

Our 65th

Anniversary Year

ones,

expenses for tax
In this respect, Cana¬

tinct

UNDERWRITERS

•

I

DEALERS

•

Last

COLO.

PHONE AC 2-8621
DN

557—Trading Dept.




DN 76—Municipal Dept.

i

DISTRIBUTORS

dis¬

with
their
U.nited States'-competitors operat¬
disadvantage

As

Gas

year

the Oil

Committee

Securities

Members New York Stock Exchange

and Natural
ex¬

plored the possible effects on the
oil and natural gas industry of the
development
The

of

Committee

atomic energy.
concluded
that

atomic energy as a source

of pow¬
serious
threat in the relatively near fu¬

er

offers

ture,

Chas. W. Scranton & Co.

Competitor

a

the

unless

industry

no

technological

ad¬

NEW

New York REctor 2-9377

Danbury

Bridgeport

an

by

daily,

anticipated

—

—

dur¬

The Threat of Atomic Energy

2,

To

the

the esti¬
oil
industry

assumption

mated

the

dis¬

negligible.

atomic

use

unlikely

000

of

loss

"If all incremental large
stations built after 1960

to

were

that

than

oil/ the

almost

leading authority

a

subject,

in vari¬

table

electricity.

generate

Whereas this is, of course, a great¬

exploration

o|

a

industry's least
normally selling

ing in Canada.

SECURITY BLDG., DENVER

To

the petroleum industry this would

from the property
This change in the tax

dian oil companies were at a

Member Midwest Stock Exchange

ex¬

that" it

assume

market" "there.

the

"corners

stages of planning and nego¬

tiation.

logical

most

.

indus¬

the earliest replacement of

conventional

feet,
In

electric utility

the

which

which step,
in the past, was considered un¬
satisfactory because of the loss

write-offs.

Garrett-Bromfield & Co.

,

ly 13% of natural gas marketed is

Power

Nuclear

To

Effect upon Gas and Oil

year

ticularly smaller

SECURITIES

the

build

atomic

large

deduc¬

may

will no doubt tend to pro¬
mote mergers of oil concerns, par¬

CORPORATE & MUNICIPAL

of

power

of the

apt

Active markets maintained in

have studied

carefully

struction

of $80,-

has

DENVER,

here.it

short-

a

the first

to construct

the

Tax

.

ject

power

boundary to Winnipeg.

An

KEystone 4-3201

spread

meeting con¬
will build the
stantly increasing demand.
the
Manitobaboundary
through
to
Electric Utility Industry Builds

which
from

ernment,

utility

plant programs.
At this writing the earliest like¬

atomic fuel will
receive its first wide¬
use
in the generation of,

Those

Alberta

status

present
nuclear

it still appears,

in

Plans
Lines

Municipal and Corporate

BUILDING

-

daily.

Rocky Mountain Securities

Telephone:

indicated, and

the

shows

announced

probably

of

the

SECURITY

present today.

to

seems

last report

our

operation/ before the to be a matter of long range plan¬
1957,with
the
initial' ning for more extended and im¬
throughput estimated at between proved service rather than for
300
and
400
million
cubic
feet expectation of immediate profits.
be

end

Northwest

Company

light,

A leading authority in

is expected that this fine- electric power; and

It

will

Distributions

Cr

as

Boundary,

cific Northwest Pipeline

best advice

Coughun

the

petroleum

partially deficient Kapuskasing and rent it to Trans-

Try

artificial

of

source

lamps.

As

v/here it will connect with the Pa¬

of

Both

a

potential

than one-third of its 30-inch

more

.is

I

of

.

of

All

turn

industry has sug¬
gas
reserves
in Alberta
and
Northeast British
Columbia gested that perhaps introduction
finally resulted
in
projects
to of the electric light bulb presented
market
this
commoditybeing (or seemed to present) very much
started.
Westcoast
Transmission' the same threat to the petroleum
Company Limited has now laid industry then as the atomic energy

000,000

Prime

for

the

Canada.

For

the

the primary demand on the petro¬
leum industry was for kerosene

term loan to the company

the

before

century, when electric energy be¬

of the increasing

pressure

by the high cost,
safety factors

the smallest reactor.

even

Shortly
came

The

deficiency

the

Pacific

for

natural

capita basis, is rising rap¬
A little more than 50% of
petroleum consumption

nadian

exports
in
recent
latter
group
of

Natural Gas

in the region, and upwards
700,000 square miles of prime is now being supplied from do¬
petroliferous sediments is one thEft mestic resources and it is antici¬
provides support for the predic¬ pated that this percentage will
tions of an MER (Maximum Ef¬ rise moderately in 1957. Capture
ficient Recovery) of 1.5 million of the Montreal area market in
B/D by the end of 1960. On the the near future is problematical.
other hand, the geographical iso¬ The other logical outlets for Ca¬

oil fields from the major markets

of

slow.

of

lation

growth

in the interim solve those

problems posed

the

to

has

states

the

but

of

months

Canadian

rope

tapped,

volume

Western Canadian Crude

Possible

wells and 283
The high rate of suc¬
be attributed to the

wells,

cess

Suez and

of Minnesota, Wisconsin and
Michigan.
All these areas have
areas

HAVEN

•

Bell Teletype NH

New London

191

Waterbnrv

Volume

184

Number

5594..

.

The Commercial and Financial Chronicle

.

(2575)

7$

*

*

*

by the submarine Nautilus far
ceed'its

ex-

Continued from page 31

great cost; and expressed

To

'

in

the

of

use

V

atomic

fuel for

defense purposes by ex¬
panding substantially its plans for
additional
surface
craft

submarines

lahnr
labor

cost

this, it

of

the

And, of

are

primitive/,.

■

.

events such

course,

held

„■<

field

of

space

heating.

land

transportation and
For like reasons—

In

size, weight and cost—the

use
of
atomic fuel in commercial aircraft

does not

seem

feasible, from

Will be used

within

the

During this past

ficant

no

The

T^'

:

ket
-

VKm. C. Jackson, Jr., Chairman
First Southwest

1

H.

-

ties

<.

Union Securi¬

& Co.

i

b& untrained

may

New York

.

'./•

'•

j•

companies

;

Bayard Dominick

Rotan, Mosle & Co.

•

ties

&

with

carry

confine

™

it

responsibility

a

,

To
the

take

the

profits with
who win

„ers

.

Hsk$

,

in

their

particular

a

In the first place

associates

in

ap-

j and

the

World

Bank

private part-

our

m

,

,

0 *?

I trust

,

p Set a business going and
sell Our our interest to

then to

During the
the

of

to

number

to take the* risks involved. I hope
that
under
present
conditions

be

The

stock

it

public

.

w^h

for

R

A

I

Operated

have

considerable

believo, that

anf\

.

all

thf-

self-in te r

periods

"V"*'

t:

that
be

general

play

although
it
cannot
itself
the rights will seek to

further the setup and

goods and

people

Dillon,.-Union Sequri-

In

Co.

for

investment bankers

responsible

for

of

run

shall

inducing

investors

ments

Role

of IFC, as they are fully covered

beyond

in

this

a

booklet which I believe many

.

have been

we

that

and

nessmen

responsible

for

more

system.

.

.

hay,e.v.-come

And

benefits

believe

live.

in

and

we

it

to

do

can

have

andt

us in-

are under

world

m

children shall

'

.

4.,

enterprise is

haps the only

,

the

our

This private

that
where

Communists
system,

our.

per¬

which

weapon

the

and

the

I

stability

which

.

from

immense.

economic

country

and

busi-

active consideration. A number
these

the

people of thos$

be

can

much to protect our security and
prosperity by promoting progress

en¬

investors here

tei'estin2 Proposals that

to

we

laA

has 'the

opportunity to bring its abundant
benefits

of

top

to

the

people,

Com-

munism will not grow,

"****

conditions.

finally, I believe that there

investment bankers may
growing activity of

will emerge over a period opportunities for some of you ..to par.ticipate in investment banking in
the first place, it is important certain iof
the
lessdeveloped
in

life

other

any

the risks of foreign invest¬
under- current

And

better

a

than

countries

procedure

abroad have presented to
to

com¬

-

couraged

inve<;f

economies aroundlark
of a the
countries

of

I shall not take time to describe The benefits to the

Association
ihn

an

rather-

se":^em fto pri™te Purchasers There is no task more useful; than
gajng Gn the^uccessful enterprise^ fem^t^ofhlr6 spi!ead °*w
^
successful enterprises, tern to other parts of the world.

_

interesting to consider what

Almost

a

Cejvtvky's Experience

this

Americans

York

in

est' ail d ^re s pons i b iTi t y

the

Bankers'

this

lpaderc

with

had

man has evolved.
It provides more opportunities for
the individual, more and better

warrants.

exercise

vestments, but
.

years

have

observe

petitive private enterprise system

*01 Suffties

Small Investor Qut

I

to

is the best that

rmproven

is

10

conviction that the American

participation in
carrying
rights
of

or

Bank
.

deal,

we

past

-

deben¬

a

some

and

conversion

IFC,

capital.

will

affairs

our

world. This experience has mere—-j
—<■*
ly confirmed and strengthened my

moderate fixed inter¬

a

plus

profits

such

participations
to
sophisticated investors in position

venture

pattern

ture with

World

opportunity

ot oougaupn. However, weintend
we intend
Pur investments be of the
normal

handle

we can

those with whom

^ann°t invest in capital stock

type

idea

a businesslike basis
which will
win the confidence and
respect of

Charter the Corpora-

our

this

on

on

Private investors, and thus revolve
0ur caPltal*
Under

worked!

I am
happy to finish my career
dealing with private business.

e£ter_

the

ma

have

f0^ some seven years, and now the
baby is born. And most important,

.

share jn

and

prises

est rate

of their investor clients. This will

not

role you

Joseph II. King
Eastman

which

benefit.

see

It is

"/:>

firms

tangibly, there should be
increasing opportunities for investment bankers to arrange

assume

■

those

More

v

-1

v;

Investment

Houston

New

IFC has

me

former

customers.res--J&.*W®

equipped to give informed ad¬

vice will

their foreign
enterprises,
whole, have been success¬
ful and profitable.

Pharr Duson

»

are

that

the

on

New York

{•

S JJ*otal? industrial charactei
the
less
developed areas

that

garding their foreign projects, "and
I. believe

that

is

Dominick & Dominick

'

likely

their.industrial

m

^

.

.

overseas

,

he-

people
develop into satis-.:
fac.ory supert|sors» and execu-

Shearson, Hammill & Co.

r

.

seems

the- " rewards
met „, rewaras

prepared
to manuthe
within
country and

tives.

v

venture

of

local

...

v

-

field

especially
larger underwriting firmsi will
increasingly be called on to ad vise

are

mu

C.

To

peal

in of y°u have seen and which we
foreign enterprises or shall be. glad to supply to others
•
cheap and -uf funds set up to. invest primarily who may be interested
can
be readily|taught the neces- abroad.
The risks ; are, in, my
Proposals Under Consideration
sary
skills. /Beyond
this,
they °Pini°n, n°t appropriate for the
have found tHSt, over a
We have not yet made
period, sma^ or inexperienced investor,
any in¬

MiJton C. Brittain

?

privately owned
enterprises-prin-

abundant,- 'relatively

New York

.

is

labor

'

Dillon,

thev
see
see

the

abroaTtha7though

;

H. Lawrence Bogert, Jr.

Eastman

ask

threaten his business. He wants to
beat them to the draw.
v.

Austin, Hart & Parvin
San Antonio

might

.

established export marrealizing that his com-

an

he

facture

.

Company

Austin

thev
mey

-

petitors

Dallas

Edward

is

answer

he has

..

SECURITIES COMMITTEE

•

American corporations
respective fields.

where the prospects are
promising,

all

^^-^n^l^l^^r^mienfly "^wheFe ^^fW^gn^erite^riser^ith1 deft^in

^

OIL AND NATURAL GAS

:

risks

abroad, particularly in the less in¬
dustrialized
countries, untapped
markets
which
if
successfully
developed promise profit margins

indicating that atomic

Respectfully submitted,

one

in

itself—by

foreign investment. And it is
encouraging to
me to see this Association
playing
an increasing role
in this field.

the risks. We all know
that every American businessman
wants to expand his sales. He sees

been

,'v

such

of

terest

justify

energy offers real threat to the oil

,

managed

have shown your in-

—

signi¬

and gas industry.

problems

cause

V

•

have

year

developments

announced

■

all

of

Francisco next year,

support for the
the• International.. Fi-

your

of

Corporation

nance

arbi¬

vehstOTsr ^ouItfaventurTSabrMd"

pres-

in military planes.

elsewhere

It

con¬
of power
next few

source

view

and

enjt indications, though it is
ceivable that this

that

by

of these you

trary action by governments may
gravely affect foreign investment:

threat (to oil and gas) in the

fears

San

in

fact

in

creation

have taken place in the Near East
over
these past months naturally

ing

.'!

sorship in the Stanford Industrial
rtevfdnmment
Tontprpupp
Development Conference tn ho
to
be

as

raise

,

expanding

*pa

private business
in establishing

^

management, . trained
m^thnriQ
and methods nf
of

scarce,

distribution

that

appears

ic
is

prevent atomic fuel from becom¬

years

with

management

and

■*

'

in

industrial

air-

an

reactor, heavy
weight of the necessary shield and
hazards of radiation, combine to
a

'

_

vessels, including

carrier.

As against

high

'

Growing Foreign Investments

for

and

join

and
and

*

•*'

confidence

you

as

overseas.

individuals

and

as

countries.

an

Generally,

industry

on

the

expanding Pacific Coast in securities distribution
and service

is

to

industry and investors.

Association

tov be
informed -of still in the stage of individual or
developments in the field of for- family ownership, but gradually
•eign
investment.
Through
your 4he pattern of participation by the
Foreign
Investment
Committee, public is-beginning to emerge in

Allen J. Nix

Riter

&

Co.

New York

]

?

-

,

1

.

.

•*

Baul A. Sellers

-

headed

'>Joe

.

by

your

ated
Chicago

vestment Conference held
•

t

,

.

:

.

in

Orleans

the

last

Inter-American

year;

by

in

your

In-

~

New

beyond

certain point there must
be capital markets. These are al¬

spon-

in

;

securities

are

generally

quite

elementary. There should be attractive and profitable opportune
ties, for some of vou, to take a
band in this business during the

Specialists in Western Securities

years.

i

-

-

-

..

.

mergers

and reorganizations

460

Montgomery St.' SAN FRANCISCO 4
OTHER

to

was

conceived
of

the

closely

Los Anseles 11

out

of

the

New York 5

San Jose, Cal.

10 Wall Street

55 N. First Street

275 N. Canon Dr.

1P79 B. Street

WHitehall 3-1000

CYpress 2-2442

CUestview 4-5121

JEfferson 7-MU

Beverly Hills.

CO.

Members

—afid

to

it.

and

Only

60 countries)
in

the

is

the
(now

may

be

Chicago Board of Trade

provide

New York Produce Exchange
Fresno Cotton

Exchange

(A»>»ciate)

Salt Lake

-

City Stock Excliange

the

INVESTMENT SERVICE

furnishes

administrative

makes

of

conditions

World

available

experience
around

UNDERWRITERS

Corporation's

The

and

i

*

Complete

Corporation.

Directors.

range

Excliange

Manila, F. I,

DIRECT PRIVATE WIRES TO ALL PRINCIPAL MARKETS

are on the way.
They have put up
the capital—now about $80 million

San Francisco Slock Exchange

Commodity Exchange, Inc.

Hayward, Cat.

"" CORRESPONDENT OFFICES

Already 35 have joined and others

New York Cotton

EXbrook 2-Q900

experi¬

Bank

members of the World Bank

numbering

American Stock Exchange

•

OFFICES

Finance Cor¬

World

related

stockholders

Exchange

; -

poration which, as you know, was
a
few months ago.
It

ence

New York Stock

'.

«

organized

municipalities

SCHWABACHER

•

in

of the International

Municipal underwriting*

Advisory service

Now

.V

'••••

••

Van Nuys Bldsr.

t

closing let me take a
few minutes cf your time to
speak

^

•

Exchange
*
San Francisco Stock Exchange " *>
Exchange (Associate)
Los Angeles Stock Exchange

Honolulu, T. II.

Private placements

-.

•

..New York Slock

American Slock

Discusses F. F. C.

.

.

Industrial Brokers
MEMBERS'-

Michigan 7711

coming

financing

Investment Dealers and Brokers

Underwriters

a

beginning to. develop here
and ihere, but facilities for underwriting, distribution and trading

v

corporate

sumo c co.

.If industrialization is to
proceed

ready

Underwriting and

Since 1858

Latin -America
and
elsewhere,
India and Pakistan for example.

now by
participa-

lion

,

f

by Bob Craft and

Johnson;

'

The Illinois Company Incorpor-

V

JK

the

Bank

BROKERS

staff

services

its

DEALERS

wide
DISTRIBUTORS

regarding
world.

PRIVATE LEASED WIRE SYSTEM

The

Corporation itself has a
small operating staff consisting of
men with backgrounds in
private
business and

finance in this

Dean Witter
8c Co.

coun¬

try and abroad.
100 Montj'wnrrr S*.

Kelt

SAN

FRANCISCO 4

Hyilen l«lrt>p«M'-349

New York

Salt Lake

Fresno

City

,

—r-

I'rivale wire* lo print'ipal iillicei

Monterey

San Jose




•

T«I. Sillier 1-5600

■

Oakland

Santa Barbara

Sacramento
Santa Rosa-

Membert-

It is unique that a

large number
governments spread over the
world have joined together for the

_

New York Stock

of

of
helping " to develop
private business, in which govern¬

los Anqeles

Exchange

StdcVExehongf

•

purpose

ments will

not have

a

Private leased

voice:

simple:

•

principles

are

San Francisco Stock Exchange

•

PORTLAND

•

HONOLULU

•

•

v.

American Stock Exchange

NEW

AND

YORK

,

exchanges

radiotelegraph circuit

LOS ANGELES

•

Chicago Board of Trade

ond other leoding commodity
—«—■—*

SAN FRANCISCO

0'»»* purposes and

•

Midwest Slock Exchange

Honolulu Stock Exchange •

•

OTHER

te

Honolulu

CHICAGO
PACIFIC

•

BOSTON

COAST

•

CITIES

SEATTLE

%

Chronicle

The Commercial and Financial

-TO

.

.

.

Thursday, December 13, 1956

(2576)

V

45

refined

more

come

Continued from page

demand¬

and

ing, the Atomic Energy Commis¬
begun procurement pro¬

Report oi IBA Nuclear
Industry Committee
Atomic Industry Forum

last Sep¬

it

"Whenever

costly

Xess

-considered,

materials

purchase

services

and

build

to

than

rather

all factors
attempting to

so,

are

we

and

feasible

is

do

to

own

our

plants to supply them. Contracts
-which require the supplier to sell
his entire output of a given mate¬

service,

rial,

the

to

product

or

whenever
the contract can be revised with¬
out loss
to the Government so
that the supplier can sell to com¬
will

AEC

modified

be

mercial customers.
are

New contracts

being written, when possible,

sales to

to

permit and encourage
commercial customers.
"In

cases

where the number of

planned
or underway appears to us to be
insufficient to provide a market
size

£or materials or services of a

to warrant private investment on
timely basis, we will consider
■contracting for some of the mate¬
rials or services we normally sup¬

a

Such contracts

generally not increase costs
to the AEC for the materials and

jnust

services, all factors considered."

ties

and

Energy

Elements

have

thorium

become

well
least

ita

by

understood
terms of

in the nuclear

derstood,

but

Rare

and

reasonably

investors,

at

their general use

high cost and a lack of knowledge
in handling and production. This,

is basically due to the
a significant commer¬
cial market for these elements.
Reactor technology covers sev¬
of

course,

of

absence

eral

de¬

areas
where
these metals may

potential
for

mand

in¬

importantly such as con¬
trol rods, moderators, structures
and cladding components on fuel
of

reactor

in any type

satisfy the ordi¬

must

engineering requirements of

nary

resistance,

ductility,
In

etc.

strength,

thermal

corrosion

conductivity,
these

reactor,

nuclear

a

ordinary requirements are defi¬
nitely secondary
with primary
consideration going to the nuclear

properties

of the material.

neutron

The

tion.

absorption

as

cross

sec¬

iron and copper

alloys have too high a cross sec¬
tion
for
as

among

use

disadvantages

other

Thus,

in nuclear reactors.

the reactor technology has be-

of these

several

In

previous

a

tle

than

of

Committee, we have dis¬
cussed the generalities of reactor
fuels, uranium, thorium and lith¬
ium; hence, they will not be cov¬
here.

ered

The
has

include
concrete, lead and brick. To date,
the cheapest and, in most cases,
the
most
satisfactory has
been

metals

rare

will continue to

and

be

Current

shielding

nies active in the field.

boron

Moderators
slow

used

so-called

fast

occurring in the fission

Without

process.

would

chainlike

such

a
step,
and the

fission

not

would

reaction

At the

cur.

the

down

neutrons

U235

materials

are

not

oc¬

time, the mod¬

same

erator should not absorb too many
neutrons
to

tend

that

for

would

in itself

extinguish the chain

re¬

action.

To
date, heavy
water
(deuterium) and graphite have
been the principal moderators.

Boral,

as

a

aluminum.

and

naval

the

that

AEC

programs

cant.

To

nu¬

lie behind
the emergence of beryllium. The
importance of such a contract to
companies of this size is signifi¬
may

date

beryllium's

com¬

mercial market has been in beryl¬

alloys.

lium-copper

used in

are

nuclear

handle

be

made

of

cyclotrons

of

quite possible to have
previously
men¬
find an application

the

tioned metals
in this

for

Coolants

power

producing reactors where a high
operating temperature is desired
are liquid metals such as sodium,

coolant,

In

it would appear
technology has
reached a point of technical re¬
finement which is resulting in a
demand for many theoretically at¬
summary,

that

nuclear

tract

fuel

fissionable

element

from

should
future

On

the

other

of

many

even

clear.

A

running

into

can,

material

structural

that

$10

in

atomic

animal tissues, and

in

therefore, be traced by sen¬
Y
be

to

seems
uses

endless

an

for radioisotopes.

For

example in the field of medi¬
they are used to diagnose
various circulatory disorders, to
cine

locate malignant tumors

and treat

thyroid diseases and cancer. In
agriculture
they
are
used: as
tracers in studies on uptake of

fertilizers, soil fertility, plant dis¬
eases
and
fungicides,
moisture
distribution, root growth and
photosynthesis. Through their use
in industry, significant develop¬

large in relation to the gov¬

billion

within

movement

or

number of

ernment's total investment of $8-

common

tools in

ments

types

have

activation

energy.

luminescence,

chemical

of

sterilization

of

various

in

occurred

gauging,

of

reactions,

foodstuffs,

radio¬

isotope battery development, wear

tens of millions of dollars is

cellaneous applications.

the most useful re¬
the entire history
Because
they
are

among

There

or

not

of

proving

sitive recording instruments,

con¬

millions

types

are

industrial and chemical processes,

the

gelf-corrosion, and for other mis¬
The only

These

science.

plant and

is far

procurement

by

other

or

of

fission.
also
the use

can

radioactive, their radiation tells
where
they
are,
even
if
the
amount is extremely small. Their1

remembered

be
of

above-mentioned materials

cladding to protect the

as

it
the

hand,

from

to

materials.

tractive

be

search

location

area.

Reactor

to

by

atoms

radioactive

actors.

the

reactor

stable

of

It is also

be

can

bombardment

emitted

neutrons

accelerators.

that

Structural Materials
a

the

the

to

reactors

complex of
Again the

an¬

aircraft

and

clear

has

isotopes

separation of fission products or
by subjecting stable materials in

growing importance of the light¬
weight concept comes from the
military needs for portable re¬

some

expensive "look-

produced in reactors either by the

Naturally,

potassium, bismuth, lead and mer¬
cury or alloys thereof.
Currently
nounced a purchase contract for sodium and potassium appear to
be the most promising.
In this
beryllium metal. Beryllium Cor¬
area of liquid metallurgy, Callery
poration and Brush Beryllium are
Chemical, a subsidiary of Mine
each scheduled to deliver 100,000
Safety Appliance Co., has the un¬
lbs. ($5 million) per year for the
next five years.
It is speculated disputed leadership.

the

Recently,

an

Radioactive

lightweight

of such

development

quite profitable for many compa¬

to

developments

to the concrete and the

gregates

con¬

metal may be lit¬

rare

Radioisotopes

Materials

Shielding

concrete.

more

see."

Foote Mineral.

include the addition of metal ag¬

for

program

been

multimillion dollar

a

tract for

Grace, Michigan Chemical and

new

reports

Hence,

America, Lindsay Chemical, W.

R.

your

metals of con¬

common

struction such

This

physicist calls

what the

to

refers

im¬

increasing

used

Material

rods.

un¬

industry. Less

of

of

drawbacks

major

usual

metals.

zirconium,

most new things,

the

Metals

uranium

like

as

the nuclear scientist.
they have

facing

Like

the

Atomic

technology

nuclear

elements

such

beryllium,
niobium,
samarium,
yttrium, etc. Each of these has a
special property which is theo¬
retically useful in solving one or
more of the engineering difficul¬

crease

rton-AEC reactors firmly

ply for ourselves.

in

portance
are

tember 26th.

for

grams

metals include Vitro Corp.

newer

of

sion has

studies,
line

location

leak

tracing

and

and treatment.

and

pipe

oil well studies

These

are

the best

fits the

requirements is aluminum.
However, because of its limited
strength and rapid corrosion at
steam pressures of a few atmos¬
pheres, its use in power reactors
is limited.
Hence, the AEC has
turned
to zirconium, a
hitherto
little known metal. Recently, $75
in

million
have

zirconium

let

been

on

lbs.

per

lbs.) and Carborundum
lbs.). The last has been

In the West's greatest

market

UNDERWRITERS and DISTRIBUTORS

(500,000
produc¬

ing zirconium for the AEC since
1952. The potentials of the indus¬
try are indicated by the type of
companies active in the field. In
addition to the above companies,

Underwriters and Distributors...

SECURITIES

(1

National
(700,000

year),
Corporation

Research

OVER THE COUNTER

contracts

competitive

a

bid basis to National Distillers
million

DEALERS IN

is
National
Lead,
Foote
Mineral, Westinghouse and Alle¬

there

j. S. Strauss & Co.
MONTGOMERY

155

gheny Ludlum.

I First California Company

Another

SAN
which

metal

rare

FRANCISCO

STREET

(4)

is

.INCDRPOR AT E O

have

believed
,f

I

MEMBERS:

L

MIDWEST STOCK EXCHANGE

'

SAN

FRANCISCO

STOCK EXCHANGE

•

AMERICAN

•

SAN FRANCISCO
300

•

ANGELES

STOCK

STOCK EXCHANGE

portance

EXCHANGE

(ASSOCIATE)

main

Teletype LA 533

use

loying

647 South Spring Street
-'

is niobium, more com¬
as columbium.
Its
appears to be as an al¬

increasing

im¬

Telephone— EXbrook 2-8515

monly known

LOS ANGELES

Montgomery Street

Teletype SF 885

LOS

to

•

-

vent

Private Wires to New York and All Division Offices

in

agent

uranium

fuel

corrosion ,of

the fission

as

cladding

the

elements

the

to

fuel

Bell

of

Teletypes

—

SF 61, SF 62 & SF 621

pre¬

rods

occurs.

growing im¬
is the

Underlying
the
of these

metals

portance

rapid expansion of power reac¬
especially the military needs

tors
for

trading markets

submarines,

surface

vessels

STATE, MUNICIPAL AND

and aircraft.

Control Rods, as the name im¬

underwriters

plies, regulate a reactor by ab¬
sorbing neutrons. The most widely
used

distributors

mium
or

brokers

UNITED STATES GOVERNMENT

of

made

boron, cad¬
hafnium, all of which

ones

and

derivatives

thereof

have

im¬

portant commercial markets.
Technical progress

within

the

4

past few years in rare earth chem¬

istry has resulted in an increased
degree of interest by AEC in such

BRUSH, SLOCUMB & CO. INC.
465 CALIFORNIA STREET. SAN FRANCISCO

elements
and

extremely
linium

of

member

San Francisco




Stock

BELL

SYSTEM

TELETYPE

SF70

wir» Mysftms

as
yttrium, europium
gadolinium, which have been

the

rare

costly

would

be

a

important interest in such
It has

metals.

sorption

factor
and

GOLDMAN, SACHS & CO.

than

boron

DEMPSEY-TEGELER A CO.

than

a

neu(nron ab¬

times

50
15

times

greater
greater

4G4 CALIFORNIA

STREET
AMERICAN

SAN FRANCISCO 20

TRUST
TELEPHONE DOuglas 4-7461
TELETYPE SF 484

cadmium.

Yttrium,

Exchange

date. Gado¬
good example

to

cloak
may

of

be

0

BANKING

about

secrecy

which a tight
is being kept,

important in the struc¬

tural-control field.

Companies

COMPANY

active

in

these

Since 1$54
HEX3E*

EEDEPAL

DEPOSIT

INSURANCE COHPOKATlO*

Volume

184

vNumber 5594

.

The Commercial and Financial Chronicle

.

.

(2577)
known

but

uses

in

there

are

a

em¬

that

vote

of

bers

many

growing list.
One point that should be
phasized is the competition
more

and

This

eighty-two U.
U.

N.

world

N.

affiliated

has

in
preparation
large
scale
plans which are estimated to pro¬

mem¬

states.

body, when estab¬
implement a broad

lished,

particle accelerators and resonant

will
cooperative program for the de¬
velopment of the peaceful uses of

transformers.

atomic

duce

radioactive

isotopes

face

Perhaps

from

competi¬

James

energy.

J.

large

"a

products

machines

along, these

comes

will

have

definite

ad¬

vantages—inherent

safety,
high
intensity, etc. The cur¬
rent sales growth and backlog of
High Voltage Engineering Corp.

controlled

is

indication

an

particle
;

As

of

many

of

peace."

A

out

twelve

development, ;l 1,000 pounds of U-235,

government expenditures are still
the backbone of applied radiation

additional

amount

to

plus

the

the

tons

built

for

the

U.

S.

next

The plant will have food'
output capacity sufficient to feed
a city of 12,000 and will cost about
$9 million—$3 million for the re¬
actor, $1.5 million for a particle

has

accelerator

power

Army.

and

million

$4.5

for

the buildings and equipment.
To date, while the prospects for
radiation sterilization of foods for

at

summer

been

Vienna,

selected

has

been

the

real

significant

to

of

anticipated,

and

of

motivated

the

military field is promising.
military may accept foods
lower in sensory appeal so long
as they
satisfy nutritional stand¬
ards

quirements

fulfill

and

requirements.
of

cost

only

military

Estimates

radiation

be

rough

logistic
of

the

sterilization will

calculations

until

natural

gas

and

power

the

stabilized.

uneconomic.

are

Before large-scale
commercial
application can begin, numerous

year,

nutritional and bio-chemical tests
will have to be performed.
The

clear

States'
On

power

17

of

ppwer

station in

the

plutonium, with electric

ergy

as

they can be
accommodated by existing facil¬
ities.
For some foods, radiation
fit into the current

can

processing
packaging schemes. In other
cases,
a
complete revamping of

and

present

methods

is

indicated.

mates

in

Russia

United

tion
can

cents

the

in

cost

breadth

the field

Foreign
The
that

While

machinery.
clearly see
of

irradia¬

nobody

the

dollar

applied

of

and

radiation,

research

interest

taken

eign field since

development

place
our

the

in

for¬

report of 1955

is, unquestionably, the creation of
the

International

Agency

by

Atomic

unanimous

5,000 K.W.

5,000 K.W.

.

States

0

expected that these figures
will look radically different when
the United States starts in earnest
in 1957.

France has initiated both

Developments

outstanding

28,000 K.W.

.

_

__1

tual

program

Energy
standing

which
a

with

reactor

power

has

nuclear

It is

is most impressive.

Nuclear

...

„

France

food

of

can

basic

use

fuel

known

thorium

charge

an

ac¬

plutonium

a

as

as

of

G-l

well

as

future, and, in addition,
be

expected

from

the

important

as

military

vehicles.

submarine NAUTILUS
been

operating
months

as

might
largest

producer in Europe, she

Mmmmmmmmmmmmmmmmmmmmmmwmwmmmmmmmmmmmmm

as

physicists,
anything

to

be

marines

for

which

funds

which

U.S.S.R.'s

BANK STOCKS

well.

I

itiated

in

Russian

of the
in

Germany.

and

i

YUkon

Building, San Francisco 4

6-2332

w.

§1-




•

Teletype SF 1011

a

part of

and

merchant

that all

expected

major vessels of the Navy

constructed

"atomic."

after

1960

will

a

cruiser, for which $88,000,000 is
in

the

current

budget.

Also
in this.
year's budget, are
$8,000,000 in funds for prelimin¬
ary ^development ;of
an ./atomic
aircraft carrier expected to cost

neighborhood of $250,000,-

ooo.

driven

by

E

n e r g y
Maritime^

pushing

are

construction

ship

tentials of isotopes
forward
in

I

Uranium

major industrial growth
naturally resulted in expan-

has

sion

of

the

demand

in

needed

operation

the

of

construction

reactors.

The

extension in

of

the

a

The

old

uranium

United

expire

and

March

on

for

States

Armed

engaged
what

are

in

Services

the

also

are

development

termed

"package

tors," small reactors which

of

reac¬

market

31,

for

is

cow- >

due

31-1962.

therefore,
chased, to
the

new

changes
a

until

from

which

a

pro¬
puir-

which calls

program

Continued

Underwriters, Distributors and Dealers

per

on

pound

page

in

Corporate, Municipal and
Unlisted Securities

J. Barth

&

Co.

ESTABLISHED 1883

MEMBERS:
NEW YORK STOCK EXCHANGE

SAN

.

J.OS ANGELES STOCK EXCHANGE

.

FRANCISCO STOCK EXCHANGE

AMERICAN STOCK EXCHANGE

SAN FRANCISCO

LOS ANGELES

Private Wire Connections betiveen alt

cen¬

Direct Leased Wires

Shearson, Hammill & Co., New York

•

(Associate)

NEW YORK

Offices

to:

Scherck, Richter Co., St. Louis

are

for the adequate train¬
ing of physicists. It is to be hoped
that, as in other sciences, geniuses

programs

who

will

make

Dealers in Industrial & Public

coun¬

Utility

substantial

contributions to scientific

Stocks & Bonds

knowl¬

edge and the welfare of mankind.
Corporate Developments

Active Retail Outlets

The outstanding development in
the
over-all
nuclear
industrial

field

is

that

the

have

of

really

been

the

*

electric
and

rapid

made

moving

the

genera¬

in

power

in

strides

in

commercial

field

NAULT

atomic
of

pro¬

During the

ESTABLISHED

programs

1931

Building, San Francisco 4

gram for reactor

m

Russ

been

pushed

m

major

If

for

the

electric

stations
ward

P

year, the U. S. pro¬
development has
steadily ahead, and

have

at

construction

Bell System Teletype

SF 272

of

generating

power

been

Telephone EXbrook 2-7484

for¬

carried

rapid pace. As of Oct.
Energy Commission
has reported a total of 209 reac¬
1

a

the Atomic

tors

of

all

kinds

either

in

ation, under construction,
ing planned.
k
work

in

the

reactor

field

ELWORTHY

oper¬

or

be¬

Ill

SAN

electrical
is

present
forms

strides
power

nuclear

more

of

energy

costly

the

than

is

at

a

FRANCISCO

4

Underwriters and Distributors of

Corporation and Municipal
Securities
Our

Trading Department Maintains Markets in

Securities of the Pacific Coast

.

other-

most

toward

have been made in

CO.

•

rapid,
putting
nuclear
to immediate practical use
energy,

&

STREET

being

Engineering, FosterWheeler, General Electric, Glenn
L. Martin, North American Avia¬
tion, and Westinghouse Electric.
Because

SUTTER

field

where

TELEPHONE

GARFIELD

SACRAMENTO

1-4460

BELL TELETYPE SF 488
SAN

Dec,

is

ore

being car¬
Sweden,
The
Netherlands, Egypt, Switzerland,
Japan, Venezuela, Denmark and
Norway, together with ambitious

tries

to

Thai

guarantee,

payment of $8

be

can

oxide

under

gram

for

the

The

1966.

JOSE

•

uranium

guarantee

ore

was

modified foftam;

guaranteed

Government market
ered

and;
most

important development here
the

;

for materials

ried

will appear in these smaller

;

s

This

until that date, but thereafter the
AEC has extended its guaranteed

Stalin

the po¬

a

be

& Wilcox, Combus¬
Engineering, General Dy¬
namics, General Electric, Newport
News Shipbuilding & Dry
Dock,
and Westinghouse Electric.

Babcock

tion

reactors

on

of

to

guarantee will continue in effect

The

•

for¬

nuclear power

are

,

for the de^

program

driven by atomic power.

oxide.

Playing major-roles in the de¬
velopment
and
construction
of
vessels

a

military

a

be

step in shift¬
ing the surface craft to nuclear
propulsion is the construction of
included

Administration

The first

Combustion

Rus*

not

36,000-ton

by companies such as ACF :
Industries, American Machine &'
Foundry, Babcock & Wilcox,,

m

While

program,
the Atomic
Commission
and
the

velopment

sci¬

Isotope

and considerable work

Major

WALTER C. GOREY CO.

Products, American Ma¬

Foundry, Stone & Web¬
ster, and Glenn L. Martin.

nuclear-powered.

done

i
m

Alco

are:

submarines built hereafter will be

is

as¬

chine &

ward with

It

and

distant sites.
Among the firms#
doing important work in this field

appropriated. Furthermore,
the Navy has announced that all

diffi¬

the

experimental

generation

P

places,

are

1
1

I

WEST COAST SECURITIES

distant

to

sembled to provide power at those

weapons

placed at their disposal
by the present regime.
Major programs are being in¬

tion

I

.

flown

im¬

era,
including imprisonment of
leading scientists, and of the vast
practically without limit

P

ss

have

been

only

well

resources

#

INSURANCE STOCKS

followed

NAVY, and 13 other nuclear sub¬

pulsion for ships and planes.

s

for

by the SEAWOLF, now completed
and awaiting acceptance
by the

and

related

encountered

reactors

Wholesale and Retail Distributor

The

which has

successfully

is

as

of propul¬

area

ac¬

us,

spoke freely

toward
;

re¬

not

uranium

and contains many novel features
which may be significant for the

uranium

the

ters

United Kingdom

addition

special

production

of

is

weapons, new

culties

en¬

1956:

our

Their

very

entists

by-product. It is inter¬

for

oower

fa¬

realm

particles

is

could

program

esting to note the following esti¬

Thus, there may be a demand for
specialized handling equipment in
to

a

field

plement

to

duce

how

this

discoveries

supply large blocks of elec¬
tricity. The main purpose of this
large plant, however, is to pro¬

of

sub-atom

indirectly to atomic

world

examination

to

the

far

while

this

projected use of radiation tech¬
niques has given rise to a critical

in

beyond
contemplated
by

now

the Queen of England dedi¬
Calder Hall, the first nu¬

cated

superior

them

carry

point of view,
Oct.

for

cosmic energy.
The size of the
Russian program
will, in the judg¬
ment
of
American

re¬

relatively primitive, and, from
United

research

physics.

energy
on

sion

celerated to very high
energy lev¬
els
extend
into
the
realm
of

early delivery, the plants

radiation processing is used wide¬
ly enough for charges to become

Britain's

high

fuels.

need for

Russia's

appear

or

economy

effectiveness—the

hostsr in the

as

Potecorvo, who disap¬

that

search

to supplement conven¬
With this
pressing

necessary

tional

atomic

Bruno

own

nations

industrial

make

acted

reported by the visitors

cilities

the

coal,
hydro-electric

or

were

ported

power

by

those

whose

Berk-

our

pitza, builder of their first hydro¬
gen bomb, L. D. Landon, dean of
Russian scientists, and the notori¬

less fortunate than ourselves who
lack
adequate supplies of

The

nuclear

of

scientists

as
completely open in scientific
discussion,* including Pjotr Ka-

the

inauguration

needs

volts

almost

peared from England under mys¬
terious circumstances some
years
ago. The American Physicists re¬

atomic

stations

pressing

electron

which :is

marking

of

the civilian market do not appear
too
encouraging,
application in

was

billion

ous

the drawing
operation.
As

had

10

content

Russian

as

from

actual
us

of

fifty-six

as

emergence

stations

board
most

and

cyclotron,
Berkeley

eley, California Installation. Top

.

Nineteen hundred

volt

double the potential of

which

tentatively

headquarters.

electron

energy

.

be

top

•

research,; despite ^the increasing
years.
Britain
Of research reactors be¬ grid Trance-have indicated their
ing djfiilt and Jthe large numbers, intention; of making
deposits,|
of particle accelerators being
pur¬ Prospects are bright that the stat-"
ute will be
chased by industrial research and
quickly ratified by
developmentJ laboratories. There the required minimum of eighteen
is no better, illustration of this nations, and that this
vitally im¬
than the planned food irradiation portant agency
will start work
to

United

50%
larger than our
Cyclotron. This great center in¬
cludes, in a separate building, a
proton synchroton to supply pro¬

number

center

the

vis¬

and

million

an

match

group of ninety-four

through their various
plants, including the hew eenter
at Volohaya
Volga, with its 680

four

next

anyone
had
seen,

scientists

contributions of all other nations
in

of

other major countries
conducted
by Russia's

was

The United States has announced
an
initial U. S. contribution of

more

than

world

physicists from

States

nation

advanced

other

outside

a

iting

our

future of

the

technical

in

live

accomplishments
the

when

committee, which included the
Russians, met last February in
Washington to draft the statute.

accelerators.

in

fields

lives

will

revealed

its

point in history that
makes it more likely that we and
children

electric

many

U.S.S.R.

in

turning

our

total

spread.

The

worth, Chief of the U. S. Dele¬
gation, has characterized this as

waste

of her

energy requirements by 1975, with
cost
factors
accounting for the

Wads-

tion is too strong a word but even
if cheaper radiation from fission

15-35%

81

82

82

The Commercial and Financial Chronicle

(2578)

Continued

from

Equipment used.in

„

8L

page

V

of

is in

Report of IBA Nuclear
Industry Committee

difficult

the

delicate

instruments

quired,

such

ments,

Consolidated

re¬

to

oxide concentrate, up

million

one

from any one

eration.

mine

The

volving

pounds

mining

or

op-

inpurchase of

new

program,-

it

does
concentrates from mills will elimas

certain

inate

"fringe"

benefits

paid under the guarantee running
until 1962, chiefly the haulage allowance

the

and

for

payments

vanadium oxide.
Another important expansion of

the

market

pected

it

is

Britain
with
to

be

to

when

for

of

namics, Daystrom, Leeds & Northrup,
and
Nuclear
Chicago
are
showing
increasing
volume
of
sales and are finally seeing the

six to

10

Great

hundreds
worth

of

the

over

next

sound and

a

uranium

stabilize

mining

shares

the
a

market

for

year or so ago

ment into the field of

that

move

cox

has

mining

itseif

on

industry

involving
has

dollars

billion

a

establish

to

basis. A substan-

solid

a

urani-

Canadian

the

enabled

been

While

at

from

the

the

in

more

and

of

Corporation

fair

so

become

to

'of Contracts

(milliohs

is

This

than

oil

that

signed

contract

Amounts

-

•

time

future.

has

dollar

a

ex-,

of dollars)

$275

~~~~~~~~~ "

207

Consolidate'd Denisonll

201

Algom

_

Milliken

90

:
.v.

90

uranium

in

the

impor¬

concentrates.

proposals
this

for

from

seven

This

work.

involves

gram

refining

the

Lake

step

the

making of

tofore

'

been

handled

private

by

(a

division

.

of

Union

tion

the

appropriation

of

aggregate amount of $24,825,000,000 over the next 13 iiscal
years ;for Federal grants to states

H'H-I-II

"

_

60

"
IIIIIIII"

_

_

-

55

'

36

Dyno
"
Faraday" III" 1 "I I III "I ~

30

Cavendish

24

Greyhawk

18

Ray rock

16

32

Total

$1,367

General

poration

Vitro

and

of America.

There

is

forward

to

tend

we

called

the

"miokar

a

to

"aees"

the

less

or

depends

one
uoon

be

It

is

the

'

industrial

of

cate-

that

course,

of

for

construction

includes

make

LOS ANGELES 14
TELETYPE LA

•

TRinity 0281

I
1

38

Long Beach

•

San Diego

Laguna Beach

•

smaller businesses that

so

and,

^

sion.
the
to

the

services

products

However,

directly

or

in

finally attain
annual sales vol¬

qualify

indus¬

as

trially important, yet their signifi¬
cance in the economy can only be
.minor as related to the impact of
nuclear
As

energy

we

should

-

"economic

Bateman. Eichlep. & Co.

what

tem.

Investment Securities
SOUTH

LOS

SPRING

ANGELES

our

STREET

I3V

are

Pasadena, 28 NORTH GARFIELD AVE.

EXCHANGE

in

this

light,

dimmed and

we

suggest,

industry
find that

all industrial

therefore,

that

we

in the investment business refocus
our

vision

clear

the

from

trees

of

economy.

to

a

specific

recommendation

which your com¬

mittee

will

effectiveness.

It

"

our

is

enhance
our

•

-

.

70th year of

contributing
to...

/
PROGRESS

CALIFORNIA
Since

our

early

days—when

•

William R. Staats & Co.

financed such enterprises as
Southern California Edison
"

•

'

#

and Union Oil

*

Company of
some

of

our

* •

•

;

recent

underwritings: Brunswig Drug, The Stuart
Company, Hoffman Electronics, California Interstate
Telephone, The Siegler Corporation, Solar Aircraft, Fluor Corpo¬
ration, Norris-Thermador, Northrop Aircraft, etc., etc.—is
of well
over

over

those

so) of

our

half

seven

a

a

span

century. We're proud of California's growth

decades. We're

proud, too (and

we

think justly

contribution to California's progress... through public

offerings and private placement of securities. Our experience
be

can

helpful to you!

William R. Staats & Co.
established 1887

leads

believes

———
-

nu¬

industry to the forest of the
this

also summarized in Appendix

are

these G attached to this report,

sys¬

developments.

And
STOCK

some¬

concept of mass pro¬

subject affects and is affected

nuclear
ANGELES

new

its

opinion

act
News-

(s) FGdcr^l^Aid Hisrhw^y Act GrnniGnis : in* providing CGFtsin
1956. The Federal-Aid High- essential public works or i'aciliwaY Act of 1956 was adopted as, ties where the loan is not otherPublic Law 627. Since the act wise
available
on' 3 reasonable

California—to
a

mover";

prime

in IBA

energy

as

the modern credit

by all industry and
We

Redondo Beach, 209 AVENIDA DEL
NORTE

or

Seen

lines

considered

the

as

duction,

force.

a

nuclear

it

see

be

as

that

ol

fis¬

these

although

thus

summarized

The

roads.

provisions

must

may

respectable
and

opera¬

we

nuclear

of

highways which
toll

de¬

businesses

associated

aggregate,

ume

their

to

furthermore,

provide
the

control

and

essential

include

use

engineering
that
plants and the

enterprises

instrument

tion;
that

the

atomic

our

were

free

with

compete

materi¬

structural

it

followed

elements

fuel

to construct

anc*'

state

industry. It

for

ores

better

tre-

have a

on

Pr°P°sals closely and has sub(b) proposed Amendment to
mitted recommendations to the Federal Public Facilities Loan
aPPr°Prlate committees of Con- program. This program authorizes
Sress re«ardia® certa!" of thera' Federal loans to assist local gov-

Thev
of

Centurv

"

an

factor,,in the financing of highways for many years. It will pb-.
viously provide , a stimulus to
states to .finance their share of

ta'n.jtoh be introduced in 1957 „etter NOl 4 (Aug. 3. 1956) and

discovcrinfl

true,

>

iwouid have a similar impact. the

to^economicsL*

we 9fg

nuclear

a

vices
•

co-

Federal bills which appear' cer-

developments cannot
in

confined

?acets

but

.

•:mendousimpact

development^CommitJee

Twentieth

apphed

very many

PLACEMENTS

and

encourage

*

so-•munieipal financing and several principal

These

another

in

belli

Sels

and

Automation"

its

for

of

"

over-lap, and that

progress

to

seem

build

PRIVATE

to

ad°Pjed this

look

"electronic"

Chemical," the

—more

to

atm

it.

resist

als;

DISTRIBUTORS

for other highway
Com which the Federal
share paid on any project is limHed to, 50% of the total; cost
thereof),- this act will be a key
grants

systems

cooperating

-

.

inclination

an

and

UNDERWRITERS

a

be 95%) and authorizes Fed-s

meetings-4 as may further the necessary funds; and it may
the objectives of the Conference.; help -existing toll roads by bringing additional traffic On new ap¬
(3) Federal Legislation
proaches or connecting highways,
bills jf the Federal funds are not used
Since
several
Federal

Cor-

Recommendations

and

Mtmbtrs Los Ang$lts Stock Exchange

as

The

of: other

Division

Chemical

Allied .Chemical,

lining

Co.

serve.

(joint proposal); Dow Chem--problems;

phenomena

The

to

Problems.;

in: such research and. to
and,cooperate in the prepMolybdenum Company and Mai-- a ration of: such publications and
linckrodt C h e m i c a 1 Company; to hold such national, regional and

77

Croweff.Weecfon




authorizes
an

ical Company; Twentieth Century operate
Materials Corporation; C 1 i m a x/prepare

embraces the mining, milling and re-

LOS

mittee
on ~ Metropolitan
Area
Problems), Mr. Rollin Bush, Mr.
William Adams (Chairman of the
Municipal Securities Committee)

uranium.

pure

Carbide); Koppers Company, Inc., ,agency for groups and rorganizaand Kennecott
Copper Corpora- tions concerned with metropolitan

there is

MEMBER

Securities Committee

This part of the process has here-

gory.

453

: >

37

page

of

77

Gunner IVTines

!M3MSJ31SiSJSfSM31SlSJSM3M2MSMfi[SM^3

•

from

pro¬

salts,
an
intermediate
between the milling of ore

N6V0rthclGsS)

Pasadena

Washington

Report of IBA Municipal

and the AEC is currently

bidders

that nuclear

650 S. SPRING ST.

Continued

of

process

purifying uranium
opened to private in¬

studying

79

tension with the AEC for
supply-

ing

Auchincloss, Parker & Redpath

be

It has just been announced

Vitro

York

Company,

gas.

multimillion

New

Mark Sullivan, Jr.

& Co.
-'■■■*.*'-• r:'y;0

Barney

efal

sales

other

Smith,

J

Grant, Vice Chairman

may

are

energy

R.

Co.

&

York

primary

deposits are

bids

area,

taking steps to be Lorado
prepared to participate in the dis- Pronto
tribution,
in
future
years,
of Bicroft
sources

.*

Angeles

William

S.' Smithers

New

functions-of the Conference would

indicates that forward—looking oil

companies

Los

-F.

.

Durst, Inc.

sion were: Union Carbide Nuclear

present

the

Hughes. Chairman

mitting proposals to the Commis-:politan

the

places,

important to only a few of these Stanleigh
companies, it bids fair to become Stanrock
a
major portion of revenues for Can-Met
several

S.

Wagenseller &

"/•

v

Donald B. Maeurda

/

t

Hutzler

&

York

River

Corpora-

uranium

William

New

INDUSTRY

COMMITTEE

L. Holsten

Salomon Bros.

Canada, and particularly the Blind

Contract Companies
Northspan

gross

'

York

Edward

NUCLEAR
'

Genachte

to have

other

^[olybdenum, Union Carbide &
tion.

capacity.

Respectfully submitted,

privately-

Sylvania. An

by

been

dustry,

and

the major uranium-mining center
of the world in a very short time.

Vanadium

New

invest¬

an

F.

The Chase Manhattan Bank

uranium

industry. Phillips Petroleum, Texas Co., Kerr-McGee
Oil Industries, are driving to become major producers of uranium
ore,
joining Anaconda,
Climax
and

than

Co.

&

large and consistent in grade that

this

move-

the

Carbon,

and

has

rather

Witter

com-

At
a

major

been rather overlooked in articles

about

technical

:

w.

Corporation

Francisco

San
Paul

ment

Chappelle
Lnaypeue

industry
operating
government and Mr. Gordon Calvert (Munici- for the interstate highway system,
plants as agents of the AEC. As,"pal Director of the IBA);
: (the Federal share paid, on any
of this writing the acceptance of
At this conference it was con- project, is limited to 90% of the;
some
or
all of the proposals has eluded .to establish a ; Continuing -totel cost thereof except in cer-,
not been announced. Those sub- National
Conference
on
Metro- laid eases were the Federal share

has almost

seems

the

with tant sector
above, refining and

contracts,

uranium

completely disappeared.
time, there is developing

panies—a

and

in

Dean

commercial

expensive

La
i>a

York

Philip J. FitzGerald

by nuclear developments,

Representatives of member
banks employed in a

(2)

de
ae

Higginson

New

plants by Babcock & Wil¬

in turn, • have enabled
the companies to finance themselves publicly on a basis that appears to be sound and conservative. While much of the Canadian,
ore is not as rich as that found in

to

and

owned

by the Canadian authorities and mining companies. These

plan
ahead. The hectic speculative activity which so strongly characterized

Great

over

in-

the

and

industry

signed

has

enabled

the

arrangement
Britain, mentioned

tial number of contracts

The clear vision of

to

with

contracts

Government

um

years.

intensive

of

private

similarly,
Canadian

of

growing market for uranium
dustry

earths.

forthcoming

ura-

fruits

*

a°d

neighborhood of $50 million, research pay
off
in
increased
which operates in many profits.
'
A
fields of the nuclear industry, inmost
encouraging develop¬
eluding mining, milling, and r.e- ment'in 1956 has been the con¬
search
into
the
chemistry and tinuation of the Atomic Energy
metallurgy of uranium and rare Commission's program of turning
earths, has in addition joined with over additional sectors of the pro¬
Crane
Company
and
a
French gram to private industry. In this
concern to mine deposits in South
year, for the first time, fuel ele-"
Carolina containing thorium and ments for reactors were made by
rare

Government

some

dollars

concentrates

mum

ex-

contracts

announce

until March

runs

Lee
Lee

*

(1) The Chairmen of other com¬
whose fields are closely

affected

Vitro,

shortly,

that

Canadian

purchase

millions

is

announced

believed

will

the

uranium

which

contract,

31, 1962, is estimated to be in the

year

per

of mc-vuiuUi the Com¬
enlarged and broadened

mittees

Electro-Dy¬

.

of uranium

Richard
xviena.ru

membership
Hicjuueisuip

include:

to

Instru¬

Beckman

as

the
me

mittee be
mittee be

processes

growing demand. The makers

the

of

that
..uuit

control

the

atomic

Thursday, December 13,1956

...

640

south

spring

investment

street,

los angeles 14, california

•

securities

trinity 4211

-

Volume

184

Number 5594

;

...

(2579)

The Commercial and Financial Chr&nicle ■■■*

30,* 000, whichever is the .lesser; arid bonds and to yield 3.24% on 40
•'? } the granite must agree, xo- pay1 year, bonas.
cured by general obligation bonus the ^remaining cost.-..l he act -also- •
bince
the - adoption • of- the
and 4i4%
for loans secured by specifies otner -requirements hor> amendment last year almost all
revenue
bonds or, other types of - projeccs to receive Federal grants college housing loans have been
obligations, with adjustment for' unaer this-secaon. The act ,au-ymade by tne Federal Government

terms

(presently - fixed
for
ac 3?4%
for loans

loans

year

se-

.

.

Court," thereby denying funds to
segregated schools, the bill was
defeated by a vote of 194 to 224.
It appears certain that similar legislation will be introduced in

would permit greater private financial participation at low interest rates and extension of such

assistance to
institutions.
These

greater number of

a

would

recommendations

thorizes

shorter maturities).-The

or

$50,-

appropriations^ of

and
undesirable,' emphasizing "that
funds in large volume are being
proposal

supplied
at

unnecessary

as

adopted.

not

was

tne

LnkiL

for

each iiscal
year througn the fiscal year end¬
ing June 30, 1961, for grants u>

able

of

and

-states

'

equally

amendment

me

,

1955, -which

com-

avail—
investment

jaws
submitted
October.

housing. The

re-

in

it

in

that
that

hnne

™

is

fects

hope

my

(f) Proposed Tax-Exempt Divifor Investment Companies

the aggreth»

the

He

de-

aends

'

recommendations were
by' those agencies in
Hearings were held on

the Congress at the earliopportunity in tne light ot

ed by
est

further

embodying

the

of

many

propo-

sals and that further hearings
be held in

vvill

January. '

Committee of rep-?
private indus¬

An Advisory

from

resentatives

appointed to assist
Committee
...c
,llclll
in the study.
The Chairman of
that Advisory Committee is Mr.
has been

try

the

Banking

Senate

>LLllJV

...

H«WinS Municipals. No action was Kenton R. Cravens, President St
of
taken
bills (H. R. 12252 and
Mercantile
Trust Co
of
on

the Act will be correct-, H.

R.

12253)

ternal

to

Revenue

to

interest dividends"

paid to share-

holders by a regulated

T ust. C

Louis

"

exempt

investment

.

,

Sonds

..exempt

£rom Federal income tax

study and of actual ex-

perience in its administration.,

In-

the

amend
Code

program
of

Fed-

Home"Loan Bank Board and

.

.

wnich resulted in a rate ^President Eisenhower. in
his company holding the bulk of its
until July 1, 195o, and budget message to Congress this assets in tax-exempt securities.
a
race
of :.%]/&%,.on ail loans for year recommended that the law
(g) Proposed Federal Aid to
whicn reservations for funds are be changed to provide a different Education.
A bill
embodying a
made aLer that date.
Tnus, tne formula which would raise the program of Federal financial asFederal Government is presently interest
rate at which Federal sistance for the construction of
autnorized to make college hous—- loans would be made if not avaii- nublic elementarv and secondarv

municipality,

Fed-

Federal De-

Svstem

BUreauTfFederal CreditUiSons)

Life Insurance Company.
This
committee is to study and submit

there will be

vigor¬

was

not

the

substantially less

as

the

at reasonable rates by private in- revision of. recommendations for
t0 subn}it the Federal banking
dustry. *
■
v

this, kind of loan

the

to

of

DOSit Insurance Corooration
erai

.is certain that these recommendai suit would be that instead of tions will involve financing of
more capital being available for
college facilities.
;
>

upon

Currency

the

Joint

the

Nov.

On

Dealers.

7

HeM

the

Committee

hy

of

staffs

on

Internal

RgVenue Taxation and the Treas-

2%%

ury Department submitted to the
Subcommittee on Internal Reve¬
the construction oL
nue Taxation of
the House Com¬
necessary, treatment wor^s to pre-,
mittee on Ways and Means a list
v^nt tne discharge of untreated
of "substantive unintended bene¬
or
inadequately
treated sewage
fits and hardships and additional
or
other .waste into any waters
7535), problems for the technical amend¬
facilities
(H.
R
and for the purpose of reports, ing loans, secured only by college able from other sources at that school
revenue
bonds
witn rate. Bills proposing to carry out through Federal grants, loans and ments bill of 1957." One of the
4
„
WUf
liy_
plans and specifications in con¬ dorrpitory
nection therewith.
No grant shall -maturities up to .50 years, at■■?%% this recommendation were intro- advances to a
was
hi
be made for - any
project under it such loans are not available ducedin the House and Senate not adopted. After an amendment, list was the following:

or

inter-municipal

interstate

or

for

agency

*

An

if

of

toward college

avail¬

nut

sources

conditions

and

in

law

are

other

•

statutory *

a

agencies

Federalof

Governors

ResLve

al

er

private
recommendations regarding edufunds which have begun to flow: cation beyond high school, and it

ability

maintaining
adequate
measures by tnis Committee during hear¬
for the prevention and control of ings
on
the
proposed amend->
water pollution.
nient, provides a statutory for¬
Section 6 of the Act authorizes mula for determining the interest
the
Surgeon* General
to mawe rate' on Federal loans under thegrants to any state,

curtail,

eliminate,

pieiely

ously opposed in statements filed

establishing and

to assist them in

loans

11

favorable.

an

under

from

terms

agencies

interstate

to

loixx.uia

for

$3,000,000

at

housing

determined

of

. . . the re- school under the chairmanship of the proposals on Nov. 9 and 10. .
^duction made by the bill in the Mr. Devereaux Colt Josephs, r |s expected that a bill will be
interest rate to an arttically low Chairman of the Board, New York drafted within the next few weeks
level will

•

ma¬

to colleges
interest rate

five"

auested

?Cnmntroller
Board

Federal

the

in

laws,-The Committee re-

(Rousing program

• *

turities up to oO years)

u>

provide two types of Federal fi¬
nancial assistance. Section 5 of
the Act authorizes the appropria¬
tion

(witn

thorized to make loans

the

Act

Control

Pollution

Water

Col- "

Unaer the

college housing program
Federal Government is au¬

on

rhanees

nronosed

tne objectionaoie , aindnumeht,
lie. : President- Eisenhower several
banks
■
months ago appointed a commitbonds.
'■>'
"'Tii the matter of the college tee on education jbeyond high

(e) Amendment of Federal

is

rencv

on

Federal

Assist¬

amended

660

Law

f

<

Congress

v. / lege Housing Program.

Conlrol.

for Water Pollution

Public

of
taken* by

unaerwrite revenue

to

The

—.

-

Financial

Federal

*(c)
ance

was

Bankine and Curconductine a studv of

Committee

bills which would autnorize

through -the-

rates

investment banking industry.

proposal

mg

small--municipalities

to

reasonable

Uiiden^'^^^^ewM agi^
RevenueBonds. No action housing., Dili ..wmcn mduaeu

(d)_ Proposed Bank

The Senate

Bankine Studv

.

the

1957.

in

Congress

because private industry obvi- .make it possible for private indus-"
statute
cUrects
that priority
in 090,1(00 for .each fiscal -year tor-ousxy cannot generally pro viae try to supply at least a substantial
such loans be given to "smaller- sacii
giants,
with a
limitation loans
through college housing, portion of the funds necessary to
municipalities" (defined to means tnat~ toe ,-aggregate -of sums so revenue bonus witn maturities up_ finance the construction of greatshall- not • exceed, to 50 years at an interest5raie ly ^ expanded
college
housing
10,000 population or less). A bill appropriated
introduced
in
the
Senate
this ipoJO,UdU,lKji> and at least .50%, oft ot 2 '/s% when the Federal Gov- facilities.,. These recommendations
the
funds
so -appropriated
far- ernment's./fuil' faHh and credit are wholly in keeping with the
year
would have increased -thet,
concept
authorized funds, "for such loans each fiscal;year musr be used lor obligations of a comparable ma- .supposedly - fundamental
Ine
construction ©f Tumy: have been^ yielding more of 0ur economic system, that the
from
Siu0,000,000 to $1,000,000,-. grants 4 tor
servicing
than %% higher than that.
Federal Government should not
000.
When hearings were, held " treatment: works
nicipalities with a population of
The last annual report of the take over functions of private in011
this proposal, this Committee
- v-r
Committee noted tnat when Pres- dustry which can be performed
submitted
a
statement
opposing ■■120,WJ9 or less. , :-

longer

83

-

reromm^endaTionr^'nclmled

reserve'fund,

in

section

tfris,

ceeding

reasonable

in

-thereof

cost

as

or

in

an

amount exceeding

sources
ii

p

u

ernment

ing

$250,-

supporting the bills in

s^atements

Gov- hearings before committees of the
House and Senate. The recom-

recei"ktly been sell?

have

yield

to

Committee of the IBA submitted

^

pad credit

the Federal

obligations .of

-de¬

^e Municip^al becurltiies,

rate

that

at

n

when ttte full fsith

General

termined by the Surgeon

other

rom

amount ex¬
estimated

the

of

3b/o

3.32%

on

mendation was not adopted. Dur-

30. year

debate

ing

-

to

(2)

uu- U1U tu piuviue

r

allotted
state

^

"to

transferred

or

•'

of

the

dealers.

any

the

"Under

which fails to comply with

decisions

Amortization of premivm on
bonds
held
by

tax-exempt

present law where

Continued

Supreme

on

page

provide the new formula

raise the interest rate on Fed-

the

loans,

housing

college

eral

but

proposed amendment was de¬

feated

1956

amendments

housing
1

from

«of

authorized'

the

increased

•

college housing

funds for Federal

loans

Underwrite and Distribute

41-40.

i The

OF SOUTHERN CALIFORNIA

th<* bill to provide

to

the Senate an. amendment was of¬
fered to

BROAD TRADING COVERAGE

the housing bill in

on

added

WdS duueu

that no Federal funds shall be

to $750,-

$500,000,009

COMPREHENSIVE

OF THE

COVERAGE

000,000.
The

Member Los

-

.

,

Arcadia

.

„

.

"...

Angeles Stock Exchange

•

Costa Mesa

North Hollywood.- ?

-

/

Bbancii Offices:

.

Baiceksfield

•

CO.

6*

FEWEL

•

He^iet

San Diego

'

•

.

Long Beach

-Vista

>-

Direct Private Wire to

ity of Federal financial assistance
for college housing or whether a
loan program is the most desir-'
able and appropriate method ol'

providing such assistance, strong¬
ly recommends that, if Federal
financial
assistance
is provided

Calif..

Teletype LA 24 and 456

TRinitv 4191

CALIFORNIA

MARKET

Lester, Ryons & Co.
Members New York Stock Exchange

Angeles Stock Exchange

Los

•

American Stock Exchange (Assoc.)

■

623 S.

HOPE ST.

LOS ANGELES 17

•

CORNER

through* Federal loans, the law
authorizing the program should be
amended to embody the two fol¬

Federal

(i)
Los Angeles,

Spring St.

SOUTHERN

mittee, without attempting to de¬
termine the necessity, or desirabil¬

WIISHIRE AND

BELL SYSTEM TELETYPE LA
NEW

MADISON 5-7111

•

HOPE

1565 and 1566

CORRESPONDENT: PERSHING & CO.

YORK

lowing basic principles:

Singer, Bean & Mackie, Inc., New York
453

Municipal Securities Com¬

made

loans

are

Riverside

Santa Ana

San Diego

Pomona

Santa Monica

reasonable terms,

what con¬
terms'"Should
realistic considera¬

reasonable

be based on

RedJands

Pasadena

Long Beach

JHoily wood

Glendale

Encino

Corona del Mar

Claremont

only

of

determination

stitutes

be

where the
not available from*pri¬

vate sources on
and

should

loans

available

a

*

tion of rates for comparable loans
in the money market.

Serving Southern California since 1927

A Federal loan

(ii)

limited

to

a

fraction

DISTRIBUTORS
should be
of

the

re¬

of

quired funds for any project so
that
authorized 'Federal
funds

bor¬
loans
would supplement but not replace

could

Investment Securities
626

S.

SPRING ST.,

TRinity 5761

•

LOS ANGELES 14

TELETYPE: LA 68 — LA 35
MEMBERS:

LOS

ANGELES

AMERICAN

DIRECT PRIVATE
PASADENA

STOCK

STOCK

EXCHANGE




CLAREMONT

and

help

financing from private sources.

Recoginzing the need for great-'
ly expanded college facilities and
for financing the construction of
such

facilities

at

low

interest

SECURITIES

INVESTMENT

more

Federal'

the

i

Bingham .Walter s Hurry. Inc.
Member Los Angeles

Stock Exchange

621 S. SPRING-LOS ANGELES

further rec¬
that, if Federal assist¬

-

TRinity 1041

rates, this Committee
EXCHANGE

ommends

fASSOCIATE)

WIRE—KIDDER, PEABODY

REDLANDS

used to

be

rowers

ance

& CO.. NEW YORK

SANTA MONICA

SAN DIEGO

is to be provided,

be

other type of Fed¬
financial
assistance
which

program

eral

some

LA

224

considera¬

given to substituting for
the Federal college'housing loan

tion

TELETYPE

Pasadena:

70

S. Euclid

The

Ave.—SYcamore 3-4196

84

L

•

84

The Commercial and Financial Chronicle

(2580)

Continued from page

83

particularly in the preparation of tion.

;;;

the

model

two

Committee

Liaison

Report of IBA Municipal
Subcommittee

the

State and local gov¬
are purchased
at

tax-exempt

Taxation

Revenue

bonds

Internal

on

of

the

House

at

Ways and Means Committee, the
Chairman of the Municipal Se¬

against the tax-exempt in¬
terest income. Exceptions are pro¬
vided
to
this
general rule for
dealers in tax-exempt securities
with respect to bonds disposed of
within 30 days, and bonds with

submitted

premium, the premium gener¬
ally must be amortized over the
life of the bond and, in effect,

call date more than
five
years
from the time they
were
acquired.
Since amortiza¬
tion of the premium is not re¬
quired by a dealer under these
circumstances, he realizes an or¬
maturity

days,

or

of

date

which

bonds

from

phase
all

not

required to

taxable

suggested

the

result

that

that

these

30in

dealers

tax-exempt bonds will be treated
the

same

exempt
made

other holders of tax-

as

-

might

be

respect

to

This

bonds.

effective

with

purchased after the date of
report."

On

Nov.

20

the

change isolates a single
the dealers' tax situa¬
recognizing the over¬
inequities that would be

at

hearings

require

proposal

to

amortize

premiums

the

on

dealers
on

all

to

tax-

empt bonds held by them, before

American

Association

Bar

are

(The Chase Man¬
York) Chair¬
man, Walter
W. Craigie (P. W.
Craigie and Co., Richmond) and
Pat
G.
Morris
(The
Northern
John

Linen

S.

hattan

Bank, New

Trust

Co., Chicago).
This year a Liaison Committee

has also been established with the

American

Bridge,
Tunnel
&
Turnpike 'Association.
Members
Committee

Liaison

this

of

Walter

follows:

Steel

H.

are

as

(Drexel

and

municipalities.

Co., N. Y.); William Morgan
(Blyth & Co., N. Y.); Wilbur M.
Merritt
(First
Boston
Corp.,
Y.); Frank H. Morse (Leh¬
Bros., N. Y.), George J. Gru-

N.

(John Nuveen & Co., N. Y.);
(Smith,

ner

Cooperation

(4)
<
.

v

With

Other

Or-

ganizations

Barney & Co., N. Y.).

past

attempted
to
cooperate
closely with other organizations
interested

in

during

the

mittee

has

even

more

municipal

past

year

finance,

the

Com¬

attempted
to
work
closely with such or¬

I

ganizations.

The Liaison Committee between

the

IBA

and

the

Municipal Law

Section of the American Bar As¬
sociation

have

and C. Cheever Hardwick

In

the

At

could

be

used

the

Spring Meeting in May
of

Board

Governors

of

tne

IBA

adopted a resolution recom¬
mended by the Committee, as fol¬
lows:

"WHEREAS, a statement in legal
opinions on state and munici¬
pal bonds, that the interest cn
such bond is exempt from Fed¬

pal bond attorneys
l

bonds

the

and

interest

thereon

the

marketability
of
such bonds and many municipal
bond
attorneys
presently in¬

creases

of
the Committee have this year at+
tended meetings of the National
Conference on Public Works, The

Board, The
National Conference on Metropol¬
itan Area Problems, The Munici¬
pal Finance Officers Association,
Research

Highway

American

the

and

tion.

Municipal

much

effect¬

as

Associa¬
of

the

New

of

Forum

has been included
done

Bar

President

The

York

member of

a

this committee in order to facili¬

ive work to facilitate cooperation

tate

between

ization.

the

two

organizations,

cooperation with that organ¬

We

27th

that

believe

should

who

replied indicated a willing¬
to cooperate in the recom¬
mendation, but a few "replies in¬
ness

dicated that it would not be prac¬
tical
to
include
statements re¬

garding

(7)

The
ment

MUNICIPAL AND CORPORATE

such

coopera¬

IBA

Institute of Invest¬

annual

the

and

Wharton

School

Commerce

and

University
program

Ohio Securities Our Specialty

nicipal
the

at

Co.,

INC.

Pennsylvania,

of

included

bonds.

a

The

Committee

At

the

American

EXCHANGE

in

state

bond attorneys
legal opinions
municipal bonds a

their

and

that

statement

the

interest

bonds is exempt from
income taxes and, if

eral

bonds

or

;

the interest thereon are

of

ment

state

such

taxes;

exemption

from

and

of this resolution be
municipal bond attor¬
neys listed in the 'Bond Buyer
Directory.'"
"(2)

Statistical Bulletin

containing de¬
regarding the
municipal bond market. Tables in
tailed

this

information

Bulletin

all

include

the

follow¬

ing:
Table 1:

Bond

Elections Sched¬

uled.

•

Table

2:

Election

Bond

•

Results

(quarterly).
Table 3:

New Municipal Bonds
(quarterly).

Issued

Table 4:

New

Municipal Bonds

Issued by Type Issuer and Use of

(quarterly).

Table

5:

Principal

Managing

Underwriters

of New Municipal
by amount and number,
for general obligation
and rev¬
enue
bonds (quarterly).
Issues

Table

Method

6:

New

Municipal
(quarterly).

of

Offering

Bond

Issues

This Statistical Bulletin is pre¬

Mr. Frank Morris, the
Director
of
the
TRA,
and will be published quarterly.
There will also be press releases
bringing the information > up to
date on a monthly basis.
».-> v': \
pared

by

Research

Under this

a copy

sent to

Statistical Research

Program the IBA

keeping a de¬
municipal
July 1,
1956, for

tailed record of all
issues

since

new

TRADERS AND DISTRIBUTORS

of

panel on mu¬
Chairman of

served

Securities

Cleveland and Ohio Securities

mod¬

as

Conference

IN

was

The

cil

Direct Wire

Union Commerce

Bldg.

CLEVELAND

of

Rensselaer

I RUSSELL?®

COTTtOM

the

on

Business

—MEMBERS—
NEW

Polytechnic In¬

YORK STOCK EXCHANGE

MIDWEST

stitute at Troy, N. Y.,in October,
of the principal addresses was

AMERICAN

STOCK

STOCK

EXCHANGE
(ASSOC.)

EXCHANGE

one

presented

Craigie
Other

on

by

sented

and

Local

Projects."

securities

at

W.

UNION

COMMERCE

TELETYPE

BLDG.

"Funds for Schools and

State

mental

Walter.

Mr.

14,

CHERRY

OHIO

—

CV

565

1-5050

The municipal

business

the

Govern¬

CLEVELAND

w as

repre¬

Conference

by the

following participants:
William M. Adams, Braun, Bos& Co., Detroit; Walter C.

worth

Merrill, Turben

Co., Inc.

&

(Established 1924)

•

Underwriters and Distributors

Corporate and Municipal Securities

-

MEMBERS
NEW

YORK

MIDWEST

STOCK
STOCK

EXCHANGE
EXCHANGE

Cleave,

The

V

1612

Union

Commerce Bldg., Cleveland
14, Ohio

Blyth &
Walter W.

Co., Inc., Chi¬
Craigie, F. W.
Craigie & Co., Richmond; Mar^quette de Bary, F. S. Smithers $
Co., New. York; Andrew S. Mills,
Newhard, Cook & Co., St. Louis;
John M. Maxwell, The Northern
Trust
Co., Chicago; William H.
Morton, W. H. Morton & Co., Inc.,
New York; J. Creighton Riepe,
Alex. Brown & Sons, Baltimore;
Allen
D.
Sapp, Schmidt, Poole,
Roberts
&
Parke, Philadelphia;
Franci|s
Schanck,
Jr.,
Bacon,
Whipple & Co., Chicane Walter
H. Steel, Drexel & Co., NeW York;
George B. Wendt, First National
Bank of Chicago, Chicago.
cago;

Committee

is

also

MAin 1-6800

ering preparation of a "Handbook
Municipal Bonds." Section 5
the

ment
CANTON

COLUMBUS




DAYTON

YOUNGSTOWN

Fundamentals

of

UNDERWRITERS AND DEALERS IN
CORPORATION AND MUNICIPAL SECURITIES

MEMBERS
.

York

Stock

Exchange!

.

.

Midwest Stock Exchange
American

Stock

Exchange

(Associate)

consid¬

on

of

Mcdonald. & company

New

UNION

COMMERCE

BUILDING

Invest¬

Banking published by the
IBA, was deyoted to municipal se¬
curities; but that section > is out of
print and we are unable to fill
requests for copies of' that sec¬

-

pub¬
lished the first issue of the IBA

on;

Fed¬
such

exempt from state taxes, a state¬

sponsored by the Industrial Coun¬

NEW YORK

Amer¬

J

.

was

the

erator; Mr. Walter W. Craigie
(F. W. Craigie & Co., Richmond)
discussed general obligation mu¬
nicipal bonds and Mr. T. Henry
Boyd
(Blyth & Co., Inc„ New
York) discussed revenue bpnds.

★

McMANUS & WALKER

of

municipal

"(1)

such

Investment

requests that:

include
on

the

of

Association

there

dealers

held this year on April 2-6.

STOCK

ica

October

state

Banking, sponsored by the

Finance

SECURITIES

MIDWEST

"NOW, THEREFORE, BE IT RE¬
SOLVED, that the Board of
Governors

Statistical Program

In

Proceeds

such bonds:

on

exemption f r om
particular states.

taxes in

be

(5) Educational Activities

6-

legal opinions

their

in

statements

such

the

Prac¬

helpful to under¬
in municipal
bonds and to municipalities and
municipal officials.

YEAR

Wm. J. Mericka

clude

in

tically all of the bond attorneys

exempt from state taxes, in¬

are

listed

Directory."

"Bond Buyer

eral income taxes and that such

Bankers

representatives

addition,

writers and

MEMBERS

which

training new personnel in
municipal bond departments and
for distribution to municipal of¬
ficials, customers and college stu¬

coming year will be Mr. David
■
i
(Wood, King and Dawson,, dents.
New York). The members of the
(6) Statement on Tax Exemption
IBA Committee for Liaison with
In Legal Opinions
the Municipal Law Section of ttie

tion

BEGINNING OUR

Securities

Municipal

on

man

bonds

this

that

and

While the Committee has in the

day and 5-year rules be removed
with

1950

Handbook

a

Wood

&

income.

is

"It

a

both in

states

able income, is attributable to the

is

the

of

tax

Mu¬

Thursday, December 13,1956

Copies of the resolution were
subsequently; sent to /alI^municiT

the, municipal buii-

to expand "Section 5 of Fun^
damentals of Investment Banking

past year has been Mr. L. Eugene
Marx (Bear, Stearns & Co., New
York) and the Chairman for the

plicating
and
burdensome
ac¬
counting procedures which would
be imposed upon dealers and ig¬
nores
the effect on financing by

his

the taxpayer
include in his'

opposing

imposed by the proposal, gives no
consideration to the unduly com¬

acquisition.
This
loss,
be offset against tax¬

payments

of

the

of

We believe that it would be

service to

a

ness

into

proposed

may

interest

and

behalf

tion without

maturing

years

for
five

than

more

Bill

enue

or

dinary loss upon sale or redemp¬
tion of bonds disposed of within
30

on

proposed change. The statement
pointed out that a provision spe¬
cifically designed to remedy the
problem was adopted in the Rev¬

^

a

statement

a

Committee

the

of

testified

Committee

curities

offset

to

nicipal Law Section of the Amer¬
ican Bar Association during the

Securities Committee
ernment

referred

laws

The Chairman of the IBA

above.

...

CLEVELAND

14, OHIO

Number 5594

184

Volume

*

i

which information is available to

Appendix D is
list of th<6 items of information
Attached

us.
a

Walter

issues.

ability

publication of

and

maries

sum¬

Herbert

infor¬

statistical

this

of

Nolan, Fleming-W. B.
Hibbs & Co., Inc., Washington
Folger,

,

will

mation

value

of

be

the

to

members and to the Committee in
its work.

'(8)St

t

a

e

} Legislative

Develop¬

&

Appendix

as

F. S. Moseley & Co., Boston
Clifford L. Wolf

Co. *.

a

the

case

upon

Jones &

petition

Bank of Minne¬

pending and, if the
sale' of
the
Securities,
thereof,
other

Pierce, Carrison, Wulbern, Inc.
Jacksonville, Fla.
E.

shall

posed

,

■«. -*

than

thp

ceedings
attorney

county

pending,

are

to

of

the

portion
in ^ny county
which the pro¬

of spme of the principal
Bosworth, Sullivan & Company,
apolis, ]\lir>neapolis
'
legislation adopted tjhis year
Jnc., Denver
MaeBoyle Lewis
of interest to the municipal bond
Harris Trust and Savings Bank
MUNICIPAL SECURITIES
business.. Attached as Appendix
San Francisco
COMMITTEE REPORT
F is a summary of some of the
court decisions this year of par¬ Elmer G. Longwell
' :
APPENDIX A
Boettcher and Company
ticular interest to the municipal
*■
-'Denver
.-V .■■■
'. 'v.VModel Form of Bill Relating to
bond business.
v
•
"f

each county
in which it is
expend such proceeds or any

state

set

for

hearing

the

Judge may enjoin the commencement
by any person of any other action or pro¬
ceeding contesting the validity of the Se¬
curities

described

in

the

petition,

or

the

as

to

the

date

set

for

provided in Section 3, the clerk

w,hereip said petition is filed,
shall cause
a
copy of
said order to be
published in the county wherein the peti¬
tion is filed,
or,
if the petitioner lies or
functions in more than one county, then
in each of such counties in each of any

provided in Section 3,

as

to effect' such consolidation and its
to avoid unnecessary costs or

SECTIQN 5. Prior
of

4. Uppn
motion of-.the peti¬
whether before or after the date

tioner,

,

any

secure

hearing

SECTION

*

summary

tolls,

be im-

delays or multiplicity of suits. Such orders
shall not be appearable.

part thereof.

Youmans

to

tend

may

the

upon

assessements,

authorized

joint

a

proper

or '^ny

in

to

order

cir¬

of

levies

pledge of revenues, or prop¬
such payment,
and may
proceeding in any court In
the State, and may order all such actions
or
proceedings consolidated with the valida¬
tion petition pending before him, and may
make such orders as may be necessary or

erty

be expended

to

are

proceeds

taxes,

the

or

validity of

served

be

other

or

made for the payment of such
Securities or the- interest' thereon*, or the

issued

attorney of the

are

Edward B. Wulbern

Paul

be

i.

to

are

order

and

the

proposed

First National

Securities

same,

of

rates

or

the

cuit (or district) in which such proceedings

*■

-.

Portland, Ore.

..

Pierce, Fenner
Beane, New Orleans-"

S.

Securities

be demanded of liim.

may

In

validity

proceedings

the

the

of

by any State agency, authority, commission
or
department, a copy of the above men¬

Carl J. Kail

is

E

as

S. Weeks, Jr.

June

to

pertain

issuance

the

which may, affect the legality of

tioned

Gallager

Merrill Lynch,

ments and Court Decisions
Attached

B.

Yarnall, Biddle & Co.
Philadelphia

Ford T. Hardy

"

•

V.

Robert

for

Corpora-.
■■ <
; ?

'

tiOn, Greensboro ,.M'"

^

;

Arthur S. Friend

new

on

Securities

Equitable

Chicago

which

thereof,

John T. Warmath

Jr.

x

municipal bond
We believe that the avail¬

recorded

J. Fitzgerald,

Blunt Ellis & Simmons,

.as

85

(2581)

The Commercial and Financial Chronicle

.

court

Continued

the

on

86

page

.

.

,

.

Respectfully submitted,

"Nuisance Suits"

A. Lucas, Jr.

Mark

Lucas, Eisen & Waeckerle, Inc.
Kansas City, Mo.

MUNICIPAL SECURITIES
COMMITTEE

John M. Maxwell

Chairman

William M. Adams,

porated, Detroit
LeRoy H. Apgar

;•

-

Co.,

In¬

J.

Company

"Issuer"),
particular

Pressprich

& Co.

McDonald &

Company

Seasongood

Louis
J.

& Mayer

Rollin

C.

First

Baltimore

City

Moore, Leonard & Lynch

of

Bank

Pittsburgh

New York

money

of

evidence
the

called

of

Corporate and Municipal Securities

any

other

or

it proposes
"the
securi¬

file

called

petition for validation
obtaining an adjudica¬
tion as to its authority to issue the Se¬
curities and the legality of all proceedings
a

AcKelyy % Company

of

and/or proposed to be taken in
therewith,

con¬

in
proper
any assessments of taxes levied or
to be levied,
and the lien of such taxes,
the levy
of rates, charges, or tolls, and
of proceedings or other remedies for the
collection of such taxes, rates, charges or
tolls.
Such
petition may be filed in the
Court in the county in which
such

Francis L. Satler

Bush

National

.New York,

Creighton Riepe
Alex. Brown & Sons,

1

including,

WILLIAM M. McKELVY

Issuer

principal

place

located

be

may

of

business,

of

State

WILLIAM S. McKELVY

GELSTON B. MORRIS, JR.

its

REGINALD R. CHURCH

G. PEARSON RHODES, JR.

E. PAUL TUNNELL

NEW

the

against

the

and

have

or

WILSON A. SCOTT

FRANK H. HUNTER

cases,

II. Frank Burkholder

Corpora¬

(hereinafter

purpose

nection

Cincinnati

tion, Nashville

other

or

prior to the issuance
issue of bonds, notes

may

the

taken

Gordon Reis, Jr.

Taylor Bryan, Jr.
Reinhcldt & Gardner, St.

Securities

issue

for

Cleveland

borrow

to

notes

(hereinafter

Underwriters, Brokers and Distributors

the

of

agency

evidences of indebtedness which
to

York

law

by

bonds,

indebtedness

ties"),

Bowyer

Equitable

issue

and

public

other

or

authorized

State

of

Harris B. McLaren
•

Braun, Bosworth & Co., Incor¬
porated, Detroit
P.

W.

New

corporated, New York
Merle

Trust

Cushman McGee

R.

&

Northern

SECTION
1.
Any county,
municipality,
taxing district, or other political district
or
subdivision, commission, authority, de¬

partment

Chicago

.

Ripley

Harriman

The

& Co., Incor¬

Braun, Bosworth

p*-

YORK

STOCK EXCHANGE
AMERICAN

taxpayers,

STOCK

PITTSBURGH STOCK

•

EXCHANGE

.

(LIMITED)
EXCHANGE

(ASSOCIATE)

property owners and citizens of such Is¬
including nonresidents owning prop¬

suer,

W. Travis Sikes

Newman L. Dunne

Robert W. Baird

,

porated, Milwaukee

.

'

American
San

Trust

issuance

Securities

agencies,

Los

Securities,

the

of

issued

be

to

are

by

If
of

any

the

•

\

PITTSBURGH 19, PA.

the

Bell Teletype PG 587

Telephone—GRant 1-8700

authorities, commissions or

.1,

Pershing & Co. Wire System

petition may be filed in
the
Court
of
the
county
in
which the proceeds of such Securities are
to be expended or in the
Court

departments,

Security-First National Bank of
Angeles, Los Angeles

Company

Francisco

the

UNION TRUST BUILDING

or
subject to taxation therein, and
other persons interested in or affected

State

Franklin Stockbridge

Lester II. Empey

all

by

erty

Dewar, Robertson & Pancoast
San Antonio

& Co., Incor-

such

of

the county in which the seat of State
government is situated, and such petition
shall be

brought against the State of

the

and

taxpayers, property owners and
thereof,
including
non-residents

citizens

owning

property

therein,

and

Underwriters

Distributors

Dealers

Municipal and Corporation Securities

or
subject
to taxation
other persons affected by

any

interested

or

the

in

issuance

the

of

!
>

2.

.

The

petition for validation
shall briefly set out, by proper allegations,
references or exhibits, the petitioner's au¬
thority
for
issuing
the
Securities,
the
holding of
an
election and
the
results
thereof where an election is required, the
resolution

ordinance,

authorizing

ceeding

Securities

or

other

act

issuance

the

CORPORATE AND MUNICIPAL BONDS,
COMMON

pro¬

or

'...

IN

■

SECTION

UNDERWRITERS

AND

DEALERS

Secu¬

rities.

AND

PREFERRED

STOCKS

such

of

the

adoption
thereof, all
other essential
proceedings had or taken
and/or proposed to be taken in connection
therewith, the amount of the Securities to
and

the rate of interest

issued,

be

rate

of

interest

case

of

a

they are to

maximum

or

bear,

established

district

for

and, in
the

pur¬

acquiring a public
improvement for which the Securities are
to be issued, the authority for the creation
of
such district, the consideration to be
received by the Issuer for the Securities,
the county or counties in which the pro¬
ceeds of the Securities, or any part thereof,
are to be expended, and all other pertinent
constructing

of

pose

or

CURTISS, HOUSE & CO.

,

The First Cleveland Corporation
Member Midwest Stock

Exchange

Established 1914
Members:

CLEVELAND 14

upon

and

the

Teletype CV 443

-

CV 444

the

The judge of the
the petition is filed,

filing

the

make
in

3.

wherein

Court

Telephone PR 1-1571

Union

SECTION

6th Building

issue

form

presentation

and
an

order

a

notice

of

of

state

in

York

American

matters.

National City E.

New

Stock
Stock

Exchange,
Exchange

Midwest Stock Exchange

(Associate)

Cleveland 14, Ohio

Commerce Bldg.

shall,

MAin 1-7071

thereof,

general terms

directed

New York

against
"all

Correspondent: Clark, Dodge & Co.

against

and

taxpayers, citizens and
others having or claiming any right, title
or interest
in any property or funds to be
affected by the issuance of the Securities
or
affected in any way thereby," requir¬
property

owners,

in general terms and without naming
all such persons and the State of
through its
attorney
or
attorneys of the circuit (or district)
where in the Issuer has its principal place

ing,
"

•

FULTON REID& CO., INC.* INVESTMENT

SECURITIES • FULTON REID & CO.,INC, •

DC

O

them,

3

of

CO

DEALERS

SECURITY

within the

business, to appear at a time and place
circuit (or district) wherein the

petition is filed, to be designated in such
order, and show cause why the prayers pf
the petition shoulcKnot be granted and the
proceedings and the Securities valiated and

V'
U)

D

confirmed
the
shall

be

therein

as

prayed.

mentioned

above

•

served

A

petition

CLEARINGS

torney of the circuit (or district) in which
such proceedings are pending, and in cases
where the Issuer lies or functions in more

i/i
DC

Ui

►—

district),

(or

than

one

circuit

attorney

of

cuits

(or

districts),

at

days

before

DC.

$

Fulton Reid

DC
LU

a

Co., Inc.

D

2
Z>

the

time

upon

fixed

in

said

TELETYPES

said attorney or attorneys,

the issuance

the Securities has not been

CLEVELAND 14, OHIO

2

Corporate Dept. CV83

Municipal Dept. CV613

O

•

FULTON REID & CO., INC.* INVESTMENT SECURITIES • FULTON REID &




CO.,INC

Chicago

-

York

Cleveland.

Address Loans and Securities
BANK

THE

FOR

All THE

PEOPLE^/

partment.

Teletype: CV 240.

duly author¬

shall be made
thereto as
by said attorney or at¬
attorney or attorneys shall
have access, for the purposes aforesaid, to
all records and proceedings of the Issuer

U

1 PAT

Of*.

proper

Said

officer, agent or employee having
charge, possession, custody or control of
any of the books, papers or records of the
Issuer shall, on demand of said attorney or
and

WO

defense

seem

may

Telephone: CHerry 1-1920

<

-

order

hearing as aforesaid. Said attorney or
shall carefully examine the peti¬
tion and if it appears,
or there is reason
to believe,
that the petition is defective,
insufficient or untrue, or if in the opinion

torneys.

►—

Pittsburgh

for

ized,

M 86 UNION COMMERCE BLDG,

O

-

attorneys

of
DC

We clear for dealers in New

each

each of such cir¬
least twenty (20)

of
tn

O

SPECIALIZED—PROMPT

of
order
at¬

copy

and

the

upon

OHIO'S LARGEST

BANK

any

attorneys,
exhibit for examination
such
books, papers or records and shall, without
cost,

furnish

duly

authenticated

copies

Assets Over One

Billion Dollars

De-

86

The Commercial and Financial Chronicle ,■; ;

(2582)

Court,

preme

Continued

from

85

page

which

upon
(he

Within
such

Report of IBA Municipal
calendar

consecutive

three

in

weeks,

(20)

the

than

more

nor

date

for

set

thirty

(30)

hearing.

in

taxpayers,
ciuzens
claiming any right,

days prior

taxation

to

by

interested

or

Securities
be

shall

court

the

have

ally

served

In
the

the

are

said

(be

of

of

any

State

to

to

named

In

of

a

to

be

the

counties

Securities^
expended,

wherein

or

and

the

com¬

in

published in

in

of

the

seat

are

newspaper

a

general circulation
which

proceeds

thereof

part

any

State

of

the county

government

may

notice

6.

citizen
in

Any
or

the

become

a

property

all

the

named

of

tax¬

owner,

affected

person

issuance

the

party

to

by

the

court.

evidence

the

Securities

said

pro¬

oral

provided, however, that
shall file a request in writ¬

argument

the

decree

its

render

decision

ings

as

copy

of

aforesaid,

all

duly

o'

thereon

shall

mandate

and

sh^ll

in

after

shall

give

to said appeal and

be

decision

Such

final

issue

due

course.

ten

days

forthwhh,

if

Supreme
therein

Court

pending,

SECTION

has

8.

the

set

the

In

in

Court

is

the

in con¬

appeal

no

taken

is

prescribed,
the

of

shall

binding

and conclusive,
adjudicated, against the

be

to

all

as

petitioner

parties to the cause, whether

rendered

mentioned

proceed¬
the Su-

of Hhe
proceedings,
or
included
in
the
description "all pronerty owners, taxpay¬
ers, citizens and others having or claiming
any right, title or interest in any proper¬

ties

of

funds to

or

the

with

served

and

affected

be

Securities

of

person

of all lands

area

the

in

exceed
such

102

the

Joseph, Mellen

&

the

by

bonds,

Miller, Inc.

thereof

of

erty

the

of

Cleveland, Ohio

the

of

St., New York,

N. Y.

Glessner Ave., Mansfield, Ohio

which
of

cal year 1959, to be available 45%

construction,

for

improvement of

highway system, 30% for
on the federal-aid secon¬
extensions

systems within urban areas.
funds would be

states

validated

of

contains

the

tunnels:

i

decree

a»u

Since

Upon

evidence
the

of

under

end

shall

as

bv

a

rendered

cost

signed

toll road, bridge, or tun¬
point where such project
will have some use irrespective of

other

in

1.

delivered
amount

MUNICIPAL BONDS

Braun, Bosworth & Co.
Incorporated

Municipal Bonds
-

New York

-

Detroit

Chicago

-

in¬

000)

Indianapolis 4, Indiana

or

to

any

proceedby

*h"
tax¬

a

m?"

aon""l

intervene

or

tax the whn]« or
against such person

may

SWENEY

CARTWRIGHT

Public

any

Huntington

to

Ohio

hor-tof"re

be
*n

issued

and

nvipc.lnai

a

Dollars

b"

rmv

imprinted,

Bank Building

Columbus,

Securities

tim°

Million

SECURITIES

B

Securities

one

or

be

($10,000,-

eve"ut°d

—an

stamped or otherwise
any signature, seal

Board,
to

ture

as

used

ether

issued

J&.

Other

<'£

/

f'.'yW

INDIANA BUILDING
INDIANAPOLIS

•

herein

bv

or

its

Section

120 E. MARKET ST.

be

permitted
manually

The

words

shall

lie

se¬

signa¬

b"

Placed

io

subscribed.5

securities"

bonds,

notes

department,

?nv

political

3.

This

or

securities

with

of

agency
State or

this

or

of

si'bdi"isioPs..

Act

other law authorising

4, INDIANA

such

one

"public,

mean

instrument"l'ty
of

anv

2.

of

least

at

by

empowered

issuance

that

obligations for the payment of money
by this state, by Us- hnlitmal sub¬

divisions.

CORPORATION

the

or

shall

Section

officer

or

provided

required

thereon

•

b"dy

authorize

curities,

Indianapolis Bond & Share

certifica¬

endorsement required or
permitted
thereon, if so authorized by

recorded

law

shall

not

reDr"!

any

th°

facsimile

■

signatures

APPENDIX

Summary
Act

way

(1)

UNDERWRITERS

•

DEALERS

■

■

CORPORATE BONDS

Over the Counter Stocks

■

Listed Stocks

the

over

■years

.for

C

Federal -A W

108

of

of

next




Exchange

au¬

an

$24,825,000.-

thirteen

fiscal

federal grants to states
interstate system.

These funds will be apportioned
among the states under formulas
in

the

act.

The

share
Member Midwest Stock

of

for

the

snecified
'

PROGRESS

for

of 1956
act.

appropriation

amount

the

the

CAPITA!

link¬

(Public Law 627)

a^grecate
000

of

Section

thorizes

BROKERS
.

MUNICIPAL BONDS

1

Teletype IP-298

•

supplying

or

seals.

Telephone MEIrose 2-4321

payable oh account
project on the interstate

federal
of

any

UNDERWRITING
DISTRIBUTION

The Ohio

system

w

Company %

INVESTMENTS

provided for bv funds made avail¬
able

under

this

&

just.

Public

Ton

the

Cincinnati

be

in

"aid

other means of authentication,

tion,

-

the

reproduced facsimile of
or

Cleveland

was

Authorizing: Use of
Signatures in Exe¬

more

en<"*aved.

-

the

by

where

person

authorized

at
of

a

the

shall

each

be

proceeding
mst

of

hereafter

or

any

and

Toledo

section

will

be

90% of the total cost thereof, plus

51

N.

High St.

No

author¬

STATE

and

decree

the

cases

equitable and

cution

20 North Meridian Street

'

rendered)

decree

shall

the

Facsimile

Incorporated

funds

the

institution

APPENDIX

RAFFENSPERGER, HUGHES & CO.

under

nel to

finding

decree

the

said

in

court

Bill

Section

The

this

title, or under
prior Acts, shall be available for
expenditure on projects approach¬

INVESTMENT

Model

—

the v

'

thereof."

act

the

be

Use

.

Having

pro¬

was

be

The

nr

contest

therein, the
part of

any

Corporate Bonds and Stocks

i

Specializing Exclusively in

written

certificate

of

exceot

chi'-en

payer,

AND

11.

this

P"tifioner

ized

to

State.

SECTION
ill".

Municipal Bonds

a

except

or

toll

hereafter permitted

1923

published

or

was

which

sum

court

IN

act

ing
—

or

Approaches

"(b)

'

System

tunnel

such

any

by law.

pay

fur¬

Federal-aid highway
expended for the

be

or

(specifying

it

shall
in

court

original

DEALERS

any

following provisions

notice

herein

as

confirmed

interest

and

.porta,

or
now

"(a) Approval As Part of Inter¬
state

Provided

of

bridge

the

hereafter

extent

law:

reconstruction,

extent

regarding toll roads, bridges and

statement:—

which

certificate
the

of

or

such toll road

any

certificates

or

perpetually enjoins

principal

113

the

improvement

Other

section

for

construction,

and

project
Part

no

shall

would

grants

Government

Provided,
highway

expended

prop¬

decrees

stamoed

and

in

funds

or

part of

a

reconstruction,

by

ther, That

these
These

be

the

to

permitted

apportioned among

federal

as

the

or

or

suit,
action
or
proceeding
volving the validity of this bond or
provision made for the pavment of
Said

of

as

System:

Federal-aid

no

shall

except

projects

dary highway system and 25% for
on

Interstate

funds

the federal-aid pri¬

on

as¬

any

clerk of

designated

tunnel

or

route heretofore

a

au¬

to be

Court

court

on

hereafter

That

pavment

which

in

notes

following

when such

the

other

required

the

date

bridge,

road,

is located

or

levies

thereon

as

Bonds,

"Validated
of

toll

such

$700,000,000

any

taxes,

re-enue

county

h-'ve

the

.the

of

$850,000,000 for the fiscal year
1958 and $875,000,000 for the fis¬

'

10.

shall

thereon

427

is

5.

indebtedness

vided

au¬

year

The decree shall be recorded
each

hearing

by Section

act

fiscal

payment.

manner

in

SECTION

Broad

interest

such

9.

same

judgments

of the

the

con¬

notes

the

for

pledge of

any

secure

SECTION
in

1170 Union Commerce
Building

made

the

or

validity
to

INVESTMENT SECURITIES

25

validity of the
rates or other

sessments, tol's,
thorized
to
be

adopted for the im¬

of projects located on
Interstate System, whenever

already authorized for that year),

projects

of

toll

bridge, or tunnel,- now or
hereafter constructed which meets

of

appropriation

$125,000,000 for the
1957 (in addition to

projects

any

provement

Section

(2)

thorizes

part

as

System

road,

project.

certificates of indebtedness deser.b"d in t^e
or

cost

Interstate

way

any

pmc"od}"er

or

testing the validity of the

petition

total

Secretary is;'

approve

the standards

the

the

permanent

a

institution

action

anv

notice

to

the

of

Commerce

integrated In¬

an

System,

therein,
but the federal share payable on
any project in any state shall not
95%

of

the Issuance

affected

or

against

said

bv

thereby", and shall constitut°
injunction

terstate

the other 50%.

decree

such

if

or

—

and

in

the total

50% of the totdl cost of
and the state would

and

above

taken

said

filed

authorized

exceeding 5% of

pay

to be

decree

affirmed,

in

development of

able Indian lands

Federal

upon

the .Secretary

taining unappropriated and unre¬
public lands and nontax¬

the

the

all other

and

and

by

that such action will promote the

con¬

served

the

time

and

matters

the

that

remaining

petition for validation and
legality of all proceedings

the

the

the

taken

forever

of

decree

the

terms

therewith,

within

the

of

10% of such cost in any state

mary

the

cases

corpus.

determines

and/or proposed

nection

habeas

event

consideration

forth

civil

authority to issue the Securities

adjudicates
taken

other

except
Court

Issuer

before

all

over

percentage

a

no

petition for rehearing has been filed.
Such
appeal shall take priority in

shall be

certified

day

return

Court

Supreme

immediate consideration

delay.

therein

the

by

such

Thereafter

decree

A

pro¬

taken

and

appeal, the court may enter an
setting
down
said cause lor oral
argument at the earliest practicable date.

application of any party,
duly certified by the

Upon

brief,

order

said

who heard said cause
appealed from,

judge

in¬

or

of

appeal

of

his

briefs;

party

for

for

the

by

such evidence

SECTION

terested

ing

party

Any

wherein

book

of

is

located.

payer,

final

a

possible

least

and

either

returnable in the Su¬
preme
Court not less than fifteen (15),
nor more than twenty
(20) days after the
filing and recording of such notice of ap¬
peal.
On or before the return day of said
appeal,
the
appellant shall file
in the
Supreme Court a certified copy of all the
said proceedings, including a transcription

or

of

if

the

a

department, the order shall be
in the manner herein provided
newspaper of
general Circulation in

the

to the

as

file

thereafter

time for filing briefs, as aforesaid, has

record

filing and recording, in
decree is recorded,

the

published
each

the
7.

effected

be

validate

agency,

intervention

to
the
cause,
whether petitioner, defendant or intervenor
or
otherwise, dissatisfied
with the final
decree
may
appeal therefrom to the Su¬
preme Court within twenty (20) days after
the entry of such decree.
Such appeal may

petition and person¬
in the cause.

proceedings

with

render

to

and

same

SECTION

the

them

individually

make such orders

may

therein

of

and

by

days

the

ceedings and
such
adjournments as will
him properly to try and determine

process

of

Securities

mission

the

if

as

with

case

and

the
petition, shall
made
parties

proceedings,

thereafter

or

Court
and
shall
to the appellee or

Supreme

expired,
the Supreme Cort shall proceed
to consideration
of said
cause
upon
the

enable

affected

issuance

jurisdiction

extent

same

defendants in

as

in

and

as

said

to

otherwise

the

in

described

considered

defendant

By

title

petitioner
thereby or

the

against

3,

days after the return day of
appellant shall
file his

tne

the

shall deliver a
copy
thereof to the ap¬
pellant or his" attorney ol record, wno may
reply thereto within five (5) days.
After

leave of court. At the time and place
designated In the order for hearing.^ as
provided for in Section 3, the judge snail
proceed to hear and determine all ques¬
tions of law and fact in said proceedings

others having or
or interest in or
or property subject

or

(10)

upon

the pub¬
lication of said order, all property owners,
to

Section

ten

in

'

„

deliver a
copy
thereof
his attorney or record, who shall within ten

ceedings by pleading to the petition on or
before the time set for hearing as provided

a

general circulation, in each
instance
upon
any
business day of the
week, and in any such newspaper, but the
publication in the first calendar week in
each
county to be not less than twenty
of

Court.

appeal

brief

Securities Committee
newspaper

shall constitute the record
appeal shall be heard in

saici

Supreme

Thursday, December 13,1956

Columbus 15, O.

1

Co.

Volume

Number 5594

184

The Commercial and, Financial Chronicle

.

..

toll

its use.for such toll road, bridge,

,

; or tunnel.

"(c)
'

Other
ized

*

\

.

Approaches
Use

under section

v

title,

•«

available

108(b)

expenditure

is

In-

any

has

-

no

•

vided,

other

use'

approach to

such

than

as

i

has

/

an

toll road: Pro-

prior

i

agreement
with

been reached

to

approval

of

the

road will become free to the

lie

,

the-toll

collection

the

upon

sufficient

to

of

such

a

pub-

as

^ °f tht r^ulK °LSU? StUdy
within

may

(3)

be bypassed." '

Section 114 of the Act

con-

the

of

Bureau

consultation

highways:

departments. The
izes

hereby declared to be the

intent and policy of the Congress
to

-

r

determine

whether

or

not the

the

exact

Federal Government should equi-

new

Interstate

location
the

between

of

'

-

etc

(g)

'

^
Type offering

(competitive

bidding, negotiated, etc.)
^ use ojt- proceeds (99
g0rjes)

and duties of the district.

'

(12)
(14)
date

whether

and

not

or

a

*

ning

Number of competing bids

(23) Yields at offering prices
(5, 10, 15, 20, 30 and 40 year ma¬
turities)
(24) Selling concessions.
In addition, the following data
collected

on

f'

*

Record

bonds

of

State

This

&

Chicago

of

DISTRIBUTORS

'

San

Francisco

interest

of

be

to

field, Rickards Si Go.

persons

Underwriters and Distributors

en¬

Of

Municipal & Corporate
Securities

5, effective im¬

mediately, amended Act 6850, the
San
Bernardino
County
Flood
Control
Act,
regarding powers
County

Control

Flood
tax

bonded

MUNICIPAL BONDS

indebtedness

for works

the

CINCINNATI 2, OHIO

PHONE CHERRY 1-6111

Bldg.

14, OHIO

Telephone PRospect

1-2770

1701 Union

Telephone Main
Teletype—CI 197

Teletype—CV 174

but of benefit to

with

immediately,

the

respect

to

the

Bill No. 6, effective
amended
Sections

districts.

or

It

districts

to

in¬

collection^ treatment

facilities, and related
revises provisions

disposal

work.

This Act author-

of

purposes

clude sewage

also

with respect to
issuance of

authorization and

bonds.

Bill No. 41, effective
immediately, adds article 2(a) to

Walter, Woody & Heimerdinger

Assembly

Part 3, Division 5,
S. C., regarding municipal

Chapter
H.

&

sewer

SECURITIES

izes

1887

may

★

districts.

formation




of

districts

com¬

initiate proceedings for for¬
a district, and after

receiving

2, OHIO

consent

of

any

other

cities, and from the county board
of supervisors for any unincor¬
porated portions, such initiating

J city

has

BONDS

403

DIXIE TERMINAL

This Act author¬

mation of such

CINCINNATI

MUNICIPAL

I,

posed of one or more cities and
any unincorporated areas in
the
county to provide sewage, storm
water drainage and flood control
works. It provides that one city

★

1-3776

& CI 150

zone

4601, 4611, 4617, 4621 and 4622, H.
&
S.
C.,
regarding
municipal
sewer

Mayer

CeWal Bldg.

CINCINNATI 2, OHIO

of bonds.

Assembly

Bank & Trust Company

a

CLEVELAND

improvement located

zone

procedure

Provident Sayings

and. incur
for

1556 Union Commerce

The bill also revises the

zone.

issuance

revenues

or

outside the

DEPARTMENT

District.

bill authorizes the district to

expend

Ingalis Bldg.

Columbus

Hartford

contains sum*
legislation

adopted in 1956 Which is believed

The

204

88

Exchange

.

and duties of the San Bernardino

OF

Established

bond

page

state

some

Senate Bill No.

INVESTMENT

the

on

Company

Minneapolis

CALIFORNIA

Seasongood

and

ESTABLISHED 1908
*

business.

BOND

Bonds

Continued

New

Obligation

NEW YORK

Detroit

E

gaged'in the municipal securities

k-j

DEALERS and

$500,000,000
General

issued

Legislation

appendix

maries

Teletypes CI 331

to

I

State

Use of proceeds

Bldg.

(2), OHIO

.

authorize

ap¬

proposal

a

Type issuer

APPENDIX

1-6515

legislature

H

(8) Balance authorized but un¬

CINCINNATI

York

proved for referendum

Election date
Election results

issued.

v

Phone—MA in

New

Par amount of issue

under the authorization

§

NEW YORK
The

-

Name of issuer and issue

(3)

BANK STOCKS

Terminal

issue

bonds authorized

(7)

414 Dixie

may

at elections:

(6)

r

to

along the

landing ramps or wharfs.

CLEVELAND

Philadelphia

account

(22)

(5)

!

counties

Chap¬

1950

-

(4)

'!•

Of

bonds for the construction of boat

Highway

Baxter

Underwriter

(2)

i:

that

amended

Laws

Mississippi Gulf Coast

Member Midwest Stock

(1)

1

provide

the

pre-

Delivery Date (Month)
Coupon Rates

(15)

are

.

of

241

mium is involved)

Co-Manager
Number of firms in win-'

of Public Roads.

ter

Range of Maturities
Call Provisions (first call

Managing

highways
points are

MISSISSIPPI
House Bill 865

Average Maturities

(20)
(21)

the

manually subscribed.

(11)-Date of issue

(19)

selected

year

(Serial, term)

Syndicate Purchase Price

1,000 miles
System.
The

be

authorizing execu¬
public securities with the

Net Interest Cost

of

this

000 or more, provided at least one
of the signatures required or per¬
mitted to be placed thereon shall

York

A model law

tion of

of-Retirement

Method

adopted

to

COLORADO

Rating
(io)

r

territory of San Joaquin County
for controlling, conservation, di¬
version- and
storage of storm,
flood, and other waters. It pre¬
scribes the organization, operation,
management,
financing,
powers

cate-

(18)

MUNICIPAL BONDS

CINCINNATI

,

act author¬

the

Bureau

obligations);

general

(17)

the

■

Act creates the district within the

^5) Type of issuer (State, Coun-

determined by

reimburse any Slate for , a
a highway which is on
Interstate
System, whether

classes

(16)

state highway de¬
partments, subject to approval by

tably

<

Assembly Bill No. 59, contains
*. .a new Act creating the San Joa¬
quin County Flood Control and
of Watejr Conservation District. This

in

Roads

state

addition

the

to

with

portion of

-

..

n0^

$0.20

facsimile

of

signatures Was
in Colorado,
applicable to all public securities
in a principal amount of $3,000,use

property in the district for main-c
tenance and operation.

highway

Public

garding reimbursement for certain
"It is

,

to

in

stains the following statement re;

subsequent

days

(4) The points to be connected
the 40,000 miles of the InterstateSystem previously authorized
have already been determined by

which the toll section of the Sys¬
tem

ten

each $100 of assessed value of

bonds, plus a category
special assessment bonds which

January 2. 1958.

by

Statistical.'

-

annual tax not to exceed

on

1,

revenue

in

shall be submitted to the Congress

July

general obligation bonds, 6 classes

coop-

re{luir?(determine

an

New

on

Since

(3) Offering date
(4) Type issue (12

of.

the Interstate
System measure up to the standards required by this title, includmg
all related factors of cost,
depreciation, participation of Fedr
eral funds, and any other items
relevant'thereto. A complete r*~

free

traffic

in

Collected

Issues

Research Program

authorized

e

conduct,

which highways

that there is one or more reason-

to

Secretary

annual
tax
levied
by
county
supervisors to service bonds, and

(1) Name of issuer and issue
(2) Par amount of issue

for

service

available

The

the district after formation. It also

r*

Under the IBA

1956

are

tolls

satisfactory " alternate

Municipal

agencies

during the
period of toll collections, and (2)

routes

Information

procedural steps for for-,

mation and to control and operate

APPENDIX D

..

highway

and their maintenance and opera¬

ably

not

other

or

debt

authorizes issuance of bonds with

Arravivmrsr

State

"

and

tor of the IBA.

the

valid lien against said section of

tion

under

and

toll road covered in the agreement

.

which

with

eration

any bonds-< outstanding at the time constituting

"

;

or
or

use

carry out

departments,

.liquidate the cost, of

road

which

Commerce is."
and directed to

State

any

awarded

study

a

project (1) that the section of toll

■

actual

^ A
limited supply of copies of
the; new act are available on
request from the Municipal Direc-

method, and amounts of such re¬
imbursement, if any, shall be de¬
termined by Congress following

satisfactory to the Secretary of Commerce
That

of

later than
June
30,
1957:
Provided, That
such highway meets the standards
required
by this title for the
Interstate
System.
The
time,

toll road on the Interstate
System, even though the project

:

in

either

pletiOn,

terstate System projects approach¬

ing

cqnstruction

construction by contract, for com-

of this
on

the

quent to August 2, 1947,

No

author-

prior Acts, shall be

or under

for

Having
funds

The

—

free-

or

which has been completed subse-

1.

87

(2583)

exclusive

authority

to

CINCINNATI 2

4L

.

The Commercial and Financial Chronicle

J33

that

Continued from page

87

city, county

no

trict

shall

incur

the

ing

^Report of IBA Municipal

that

income

liability or
year exceed¬

Secuiities Committee

at

the

voting

that

for

held

pur¬

courts in many states
an exception to such

The

pose.

of
assent of

revenues

electors

the

of

election

an

and

without

year

two-thirds

school dis¬

or

any

indebtedness in any

have created
♦nsue
on

was' approved at the election

cases

Act

where the board of

school district
fails to pay or provide for the
payment of any rental or rent¬
als due any municipality, authority or non-profit corpora¬
tion for any period in accord¬
ance with the terms of any lease
entered into under the provi¬
of any

this

of

sions

section

Superintendent of Public In¬
struction shall notify such board
of school directors of its obliga¬
tion and shall withold out of

due

appropriation

any

state

auch

school district

an

amount

equal to the amount of rental
or rentals owing by such school
to the * municipality,' authority
er
non-profit corporation and
.shall pay over the amount so
withheld
to
the
municipality,
authority
ration

non-profit

or

in

corpo¬

payment of rental."

This Act means that upon

fication of

noti¬

non-payment of rent¬
al the State Department of Public
Instruction must withold from the
a

-district out of any further

subsidy

to school districts

es

provided
for the
private
placement of bonds issued for
acquisition of bus equipment and
for the issuance of bonds in de¬
also

and

thereof

22-175 of the Code of

6

are

doctrine," that is to

to notice of rates of

relating

interest.

No. 69
Advisory

Joint Resolution

House

the

directs

bonds

Virginia

Legislative Council to make a
study and report, by not later than

1, 1957, on the need for
standarized
procedures
for the
issuance of bonds by political sub¬
divisions and agencies of Virginia.
October

Thursday, December 13, 1956

.

F

appendix

maries of

sum¬

recent court deci¬

some

sions which

contains

are

believed to be of

ance

ment

the

say,

Constitution

California

13

the intent of the framers and rat-

amendment, the
actions of Congress and state leg¬
islatures, or the long and consis¬
tent judicial interpretations) held
that the requirement in the state
gation

work

improvement constructed

or

California

The
in

Court

Supreme

in 1932 rejected the broad

a case

In

Oxnard

of

City

of

OKLAHOMA

In Morriss

Railroad, Public Utility and Industrial Issues

accumulated

close

a

net bal-r

unexpended at
Trust

the

of

period of

$258,245, which would go to the
beneficiary, the City of Oklahoma
City. This balance of accumulated
income would result entirely from
rentals

interest

and

income

se-i

cured from the Civil Aeronautics

in

investments

and

Authority

Government bonds.

instruments Involved,

The

in¬

of its airports

lease

cluding the

)

;

by the city, all expressly provide
that the bonded indebtedness of
the Trust would never become an

obligation of the state, nor of the
beneficiary, Oklahoma City. Under
Oklahoma Trust law, the Trus¬
tees of Trusts for the furtherance

functions

public

are

state

a

Court of Okla¬
26, 1956 (in an

Supreme

homa

June

on

city's

trust, created for the purpose of
enabling the City to take advan¬

and

revenue

the

improve

the
to

tage

valid. This decision has been

"probably

as

Dunedin
Court
of

the

City

the
Okla¬

of

City accepting the trust in¬

denture, the lease agreement and
indenture

bond

incident

ments

all

and
to

the

instru¬

Oklahoma

City Airport Trust, including the
bonds
issued
thereunder,
were
valid and binding instruments. In

reaching

this decision the

held that the bonds issued

Court
by the

Trust did not constitute indebted¬
ness

of the state in violation of

a

constitutional

the state. The Court also held that

Bense, the

the

tees

its

and

rentals

United

the

and

Trust

to

to

facilities,

airport
be

expand

retired

from

and

the

agreed to be paid by the
States

revenues

Government

and

of the trust estate)

there

was

no

stitutional

indebtedness
amount

violation of

of

a

exceeding in

income and

revenue

a

con-»

prohibiting

provision

city

to

any year

an

the

provided for

the

upon

Dealers

Distributors

Underwriters

actions ques¬

tioning the validity of final de¬
crees
validating bond issues and

The Court

the

CORPORATE AND MUNICIPAL
SECURITIES

held that

Supreme

jurisdiction

of

Florida

by

homa

of

by

Florida on
7, 1956, held unconstitu¬
provisions of the
bond
validation
statute

of

facili¬
trustees

the buildings and

and

provision prohibit¬
ing the contracting of debts against

of

certain

decree.

lease from

injunction

the

denied

ed)

held that the trust indenture,

the issuance of bonds by the Trus¬

v.

conferred

United

the

of

ties to be constructed by

enlarge

In City of

offer

Government to

Trustees

FLORIDA

Florida

the

of

States

most

the

years".

limited

of.-

cost

but payable out of
from the entire system

that

against

important and significant Califor¬
nia decision affecting municipal
bonds
rendered within the past

the

*

the

Trust, but would leave

The

City of Oklahoma

the

system

Court

the proposed

pay

indebtedness,

ordinance

as
required under
Bond Law of 1941)

revenues

tion

/

the City of Oklahoma
City, and others, praying for an
injunction to prevent the City of
Oklahoma City from leasing its
airports to the Oklahoma City
Airport Trust (a public charitable

holding

vote

tional

v.

City,

(approved by only a major¬

Revenue

20

;

income

interest

operations and all expenses of the

of

1

the

to

agency.

(ii)
petitions for injunction to
prohibit
the
filing
of
actions
attacking the validity of a valida¬

United States Government and Municipal Bonds

bonded

paid

a resident and taxpayer of
City
of
Oklahoma
City
brought action for himself and
other taxpayers similarly situated,

doctrine,

sewer

valid ob¬

v.

particulars not material here) and
followed the broad special fund

extend

bonds when issued

such

and

under

authorized

was

ligations of the county.

pressly overruled the decision in
the 1932 case (except in certain

ity

be

to

opinion in Which five justices con¬
curred while four justices dissent¬

for leave to institute

INVESTMENT BANKERS

bonds

would in all respects be

Dale, 4 C. 2d 729 (Dec. 1955), the
Supreme Court of California ex¬

bonds

provisions of the Con¬

effect and that the proposed issue

doctrine and followed the limited

doctrine.

the

by

remain in full force and

stitution

law

of the bonds.

with the proceeds

other

the

invalidated

was

all

and

the Civil Aeronautics

and
would not only

-

Supreme Court of Florida original
jurisdiction on
(i)
applications

INCORPORATED

Brown

ifiers of the 14th

Constitutional require¬

tion to the

which

C. T. Williams & Co.

the

in

Supreme*- Court
of the
United
States in the Brown Case, but that

October

provides

Supreme

States

Case could not be reconciled with

doctrine" under which the except

Supreme

18 of Article XI of the

the

by

United

the

amend¬
Court of

Trust

unlawful and void.

as

rental

The

Trustees by

tation placed on the 14th

A

so-called

engaged in the
municipal securities business.
CALIFORNIA

prohibited

Authority

minority follow the
"limited
special
fund

levy.

interest to persons

Section

compliance with

the

had
and
proposed
under the plan of the Trustees be
proceedings

constitution for mandatory segre¬

tax

described

Court Decisions
This

Court
the

because

declaring

and

provision in the North Carolina
Constitution requiring segregated
schools.
The
Supreme Court of
North Carolina (after expressing
the conviction that the interpre¬

general funds or moneys raised by

were

APPENDIX

of the Supreme

by

a

special funds and not out of

other

invalidated

United States

ate the schools in

other

or

were

school authorities could not oper¬

that rev¬
obligations
are not a liability or indebtedness
within
the
meaning of such a
Constitutional
provision
(and

Virginia re¬

also other provisions

and that the

of Chapter

the

as

action
the

of

applies only where the
obligation is payable solely from
revenues
from
the
particular

lating to the sale of school bonds
to provide that the bonds shall be
sold at public sale upon sealed
proposals to the highest bidder at
not
less
than par and accrued
interest to date of delivery. There

CAROLINA

article

is commonly
"special fund

which

to

election

the

ment

Chapter 29 of the laws of J95(5
amends
and
re-enacts
Section

Act No. 758 of the 1956 session
amended

bonds.

VIRGINIA

protection to bondholders.
SOUTH

registered

fully

as

bonds or as coupon

^Department must pay this money
lo the authority to satisfy the re-quirements of the Lease. In effect,
the intent of this Act is to give
added

multiples

nominations of $1,000 or

payment of any type due the dis¬
trict an amount equal to the renals the district owes;

referred

enue

edness to

State

the

provision

a

and that both the bond order and
the

on bonded indebt¬
$175,000,000 for advanc¬
or operating
units of counties and to increase
the limitation on bonded indebt¬ Ijence need not be authorized by
edness to $9,000,000 for acquisi¬
a\^wo-thirds vote) if they are
tion of bus equipment. The Act
payable solely out of revenues or

the, limitation

No.
333
amends the act of March 10, 1949,
relating to the public school sysm to provide that:
directors

of

Carolina, relating to state
school
board issues, to increase

Pennsylvania

"In all

of Title 21 of the Code of Laws

South

November 6.

PENNSYLVANIA

.

.

.

(2584)

is

specifically

Southern Textile Securities
and

state constitution

the

appelate jurisdiction and to
original jurisdiction on specified

Properties

to

BALTIMORE

FIDELITY BUILDING

Telephone: PLaza 2-2484
Private
I

Telephones

Branch Office
Bel!

to

—

—

Bell Teletype:

1, MD.

New York and Philadelphia

Grymes Bldg., Easton, Md.

Teletype—ESTN

MD

264

Section 3, of the
Idaho Constitution, provides that
no
board of education or school
Article

ness

year

SECURITIES

C.

Bell Teletype ZP 67

the assent of twoqualified electors

In Keck

District

v.

No.

Joint Class A

370,

Owyhee

Counties, 295 P. 2d 249
(Idaho,
March
20,
1956),
the
court held, in effect, that where
School
District
A
was
consol¬
idated, by
tion
trict

Wire to

of

Carl M. Loeb, Rhoades & Co.,

a

statutory reorganiza¬

procedure, with School Dis¬

the bonded indebtedness
A could not constitu¬

B,

District

tionally

assumed by the new
" district
and spread
the property therein
the assent of two-thirds

be

reorganized

Correspondent

over

all

without
ESTABLISHED

S.

and Canyon

Markets In

New York

the

of

thereof.

our

SPARTANBURG,
Telephone 3-8446

provided

without

School

Member Midwest Stock Exchange

the income and
for it for the

exceeding

thirds

Direct Private

VIII,

shall incur any indebted¬

revenue

HINGTON

a. m. law & company

IDAHO

district

Firm

Established 1892

writs.

BA 499

of

of the qualified electors

1920

of school

District B.

Johnston, Lemon & Co.
MEMBERS

PHILADELPHIA-BALTIMORE

NORTH

CAROLINA

In Constantian
STOCK EXCHANGE

93 S. E. 2d 163

v.

Anson County

(1956), a taxpayer

sued

UNDERWRITERS

-

DISTRIBUTORS

Southern Building, Washington
Telephone: STerling 3-3130




-

DEALERS

5, D. C.

Bell Teletype: WA 28, WA 95 & WA 509

Branch Office:

Alexandria, Va.

to
enjoin the county from
issuing and selling $750,000 bonds
which had been voted at an elec¬

tion in June,

1952, on. the ground

that when the bonds were author¬
ized it

was

contemplated that the

proceeds would be used to finance
construction of segregated

schools

FIRST

SECURITIES

CORPORATION
111 Corcoran St.,
Teletype: DHAM 5094

Durham, N. <✓.
Telephone: 9-208],

Volume

184

Number

5594

...

The Commercial and Financial Chronicle

£&

(2585)
such

without

year

three-fifths

of

the

the

at the

of

consent

voters.

out

WISCON 811^""""'

such

State v. Peoples State
Bank,
N. W.
(2nd); 370 (1956) the
Supreme Court of Wisconsin up¬

retire

to

76

an

tax

amendment

the

rates

do

be

long

so

not

each $100

on

rates

bonds

election,

same

to article XI
of Section 3 of the
Wisconsin Con¬

with

ance

set

the

at

exceed

about

amendment

was

required

the

basis

of

the

to

*

computed

assessed

rather

(Special to The Financial Chronicle)

Dierkes,

on; Frank

upheld

adopted

in C/

H.

School

Supreme Court
November

tionality of
tive

act

school

limits

State

bond

approve

legisla¬
local

by

permitting
election, to

districts,' by
issues

to

up

10

percent of assessed
In

ues.

Court's
tions

of

decision,

for

bonds

of

unlimited

will

hereafter

required, instead of the three
the Attorney General has

which

required previous to this date. As
has

been

both

of

the

the

with

now

are

Co.,

practice

elections

heretofore,
be

can

Cv?i ifn
which means a favor-r
able
borrowing rate to the

G,ov-

ernment.

of

Bank

,

Still

because

still

large, although

down

in

new

expected.

modest let-

a

offerings

now and the end of

be

The

between

the year is to

trend

of

loans

is being watched very closely by
money market specialists because
the peak demand for credit is
gen-

erally reached
December.

by

•

the middle

of

no

apparent change in
Government se-

gations

held

of corporate and
are

Inv.

Co.

in

(Special to The Financial Chronicle)

DENVER,
Martin, Jr.,
William

L.

Naylor
with

Halpin

and

become

Colorado

Burl

O.

Co.,

Inc., 509 17th Street.

Chicago Analysts

to Hear

CHICAGO, 111.—The Investment
Analysts Society of Chicago will
have John G.
Searle, President of
G. D. Searle Company as
speaker
their

at

held

luncheon

Dec.

13

in

the Midland

at

meeting

the Adams

to

issues.

bonds,
equity

be

flotation
nf

hif?h

of

should show

two

<?radp

nearly

Up0n

older

issues

all

-decrease

fol-

money

markets

signs of easing.

bonds

The

including

was

which

Gov-

were

un-

slightly lower because

competition
issues

ernment

hnmk

marketed?

exception

bonds
or

from
is

not

Treasury obligations.

the

in

to be

soon,

the

offerings

ntilitv

beneficial effect

a

outstanding

xhe

changed

major

nnhlir

tended to have
the

yields
available' in

Thf>

fact

that

non-Gov-

of

market,

•

the

return; cw>

corporates and tax-exempt boncte»
better than on Goverrt-

for

the

one

of the

lack

of

main

reasons*

interest

in

the--

"latter securities.

On .the other; hand, if there
be no change-in the

First Calif. Adds

cur-

fent couf®e of loans

in the next
or so, and the demand
sho"ld continue to be as sizable

*

(Special to The Financial Chronicle!

___

LOS ANGELES, Calif. — James*
Terrell has been added to the

J® lt 1S
°,r should increase, staff of First California Co., Inc.,
there will most likely be a fur- 547 South Spring Street. He was
improved fh®r tightening in the money mar- formerly with Paine, Webber,
gone
very
*et> with the prospects quite good Jabkson & Curtis.

the

have
..

To

be

amount

'
certain

.

there

sure,

.

is

a

buying going on in
Government bonds, but these commitments, according to reports, are
laraelv confined
largely confined to nublic funds
to public funds
at

this

time.

For

tax

done,

with

being looked
few

a

issues

of these

sizable

to

exchanges.

work

ke

Bank

increased

bank

rate

the

•

_

increased

...

in

_i

very

be

short

order

in

the

968a

Santa

Monica

Boulevard.

Firmer Trend in Non-Government
Bond
Even

ditions
the

is still

HILLS, Cal.—George-

P* Gottlieb is with Great Western

Securities.
Securities,

-

.

„

BEVERLY

other

doubt

no

1

(Special to The Financial Chronicle)

prime

the

as

ioaning rates would

With Great West Sees.

should

rate

again,
wen

as

again

probably to 3V4%.

up,

Central

in-

favor in

of money

sum

put

the

evidently

with

upon

Room

A

of

some

termediate-term
not

pushed

jj.

purposes,

considerable switching is still be-

ing

be

ot

though
are

market

restricted

as

niarket

come

Leo Nied

Markets
money

for

certain

as

con-

ever,

in-

fixed

bearing obligations has been

Opens

IRVINGTON, N. Y. — Leo J.
Nied
is
conducting a-securities
business

from

offices

at

435

East

Sunnyside Lane,

most

Government

obligations,
buying of Treasury bills

the

still

very

substantial as
corporations
and
some
pension funds

far

as

%\Je invite

private

concerned.

are

l^our inquiries

i

Influence

of

3% Rate

Savings

Government

•

Municipal • Corporate

The

on

Deposits

announcement

by the Fed¬

Reserve Board, the Federal
Deposit Insurance Corporation, as
well

SECU

the New York State Bank¬

as

RYLAND

BALTIMORE

eral

Securities

ing Board, that commercial banks
could raise the

rates paid on sav¬
deposits
on
Jan.
1,
1956,
brought a number of notifications

ings

Dealers

—

Underwriters

Brokers

—

that the deposit

1899

those

New

would

Established

institutions,

cially

John C. Lego & Company

go

State,

to the maximum

of 3%

of the

new

increased

means

New

York Stock

Exchange
American Stock Exchange (Assoc.)
Philadelphia-Baltimore Stock Exchange

BALTIMORE

NEW

YORK

savings

competition

banks

for

to

indicate that these insti¬

remain
ESTABLISHED

expect

tight

The

BAKER, WATTS & CO.
Members New

York

Stock

Philadelphia-Baltimore

Associate

Members

American

rates

■

Government

ties

by

the

Savers'

trend

FHA

time

on

deposits,

these, rates

existing

Exchange

in

and

bringing

and

Unlisted

credit
that

Bonds

Trading

Markets

Stocks

in

and

Local

Bonds

Securities

ing

STREETS

seems

in

to be

line

conditions.

;

\

Bell

"

-

.

"i

System

Representative:




Teletype—BA

Clarksburg,

•«<

-

aml other

leading exchanges

This

for

395

W.

Va.

as

the

spending

Trend

Key

the

American Stock

Evelumge (Associate)

Philadelphia-Baltimore Stock Exchange

borrow¬

and

tight
to

sonal
credit

as

ever,

been

flotation

Discount

of

even

Charles

and

Chase

it

from

point.

for
very
new

BALTIMORE

Sts.

1, MD.

though

authorities

keep

demand
has

to

market continues to

monetary

tended

the

rates

—Members—

New York Stock Exchange

Status

to the unbearable
<

higher

Mead, Miller & Co

a

The money

Baltimore—MUlberry 5-2600

the

Rate's

be
•

EASTON, MD.

MEMBERS OF NEW YORK STOCK EXCHANGE

with

going to be paid on
deposits
will
provide
incentive to slow "down

.

BALTIMORE 3, MD.

K«* York—CAnal 8-7162

NEW YORK, N. Y.

PADUCAIJ, KY.

credit which has been going
very rapid pace.

on
at

Loan

Telephone*;

TOWSON, MD.

CUMBERLAND, MD.

rates

are

savings
enough

on

CALVERT it REDWOOD

-—

Dollar

the

competition

whether

out

which

individual

Active

LOUISVILLE, KY.

Teletype: BA 393

OTHER OFFICES

interest

is being intensified.
However, it will take time to find

States County and Municipal Bonds
Public Authority and Revenue Bonds

Listed

—

to

increases recently allowed by Fed¬
eral and State regulatory authori¬

Exchange
Stock Exchange

Stock

for

upward

means

S.

Street, Baltimore 2, Maryland

Telephone: SAratoga 7-8400

considerable

a

savers' money

U.

1853

period of time.

1900

Competition

Members

rates

money

for

6 South Calvert

for

deposits,

particularly the large ones in New
York
City, to push the savings
deposit rate up the limit to 3%
tutions

A Baltimore Institution since

This

year.

though they have been pay¬
ing 3% for quite some time. The
rush
by the commercial banks,

seems

Stein Bros.&Boyce

espe¬

York

at the start

the

in

even

Members

oh.

bullish

Convertible corporate

because

with

.

a

favorable

been

the.«A

lessening in the need is much
! during January and ments is

that the discount rate will

m'

Hotel.

IXSURAXCE STOCKS

a

starting

February, then the.

than

weU

connected

Investment

to

making commitments in Treas-

ury

Colo. —Letcher
R.
Wilford L. Ferrell,

have

better

not interested

are

namely

lowed by a
for
funds,

tax-exempt obli-

much

so

If the usual

issues

new

those which can be obtained on
Government securities that investors with funds

Join Colo.

tone

which has been in evidence in the
market for non-Treasury bonds,

Allen

Company,

to the money market.

demand

the

have

ernment

seasonal trend in loans should take

for

of

which

•

future pattern of borrowings js going to be very important

place,

High Center.

Investment

"

Apathetic

qurities in spite of the better

liquid

•:

,-;v

demand

being

,.

,

Investors

Building.

the

issuance

payable through the tax
and loan[accounts of the commer-

The yields available in

property val¬
Supreme
only two elec¬

school

tax
be

view

&

(Special to The Financial Chronicle)

the

constitu¬

liberalized

made

be

DENVER,
Colo. —Donald
M.
Brinck, Robert F. Collins and
Stanley Lacy are now affiliated

early in

the

1955

a

which

debt

school

of Texas

upheld

Wilson

and

Carlton

v.

District

95-day

was

Mile

•/

King et al

bills

with

computing equalized value.'

independent

Nelson

A.

L.

Three With Allen In v.

j

the constitutional amend¬
and provided a. method for

TEXAS

also

There is

provisions
1955; which v imple¬

.

through

money

necessary, according to reports, by
the confused and uncertain world
conditions. This new issue will

the

mented
ment

M.

America

statutory

£in

Calif. —Carl

Gerald

Schwabacher

-

also

JOSE,

Some

attributed

to the new
offerings of
corporate and tax-free obligations

,

than

equalized
value.
The
equalized
value for state
purposes is gener¬
ally higher than the local assessed
value in Wisconsin. The decision

Schwabacher

billion dollars

a

tax-anticipation

in

new

by the Treas-

move

in borrowing

heretofore

With

SAN

indebtedness

be

The surprise
ury

of

are

be

may

attracted

Attorney General's

the

improved trend.

an

this

let-up in the tax selling, while on
the other hand, buyers have been

Governments

on

By JOHN T. CHIPPENDALE, JR.

$2

on

Three

Reporter

the total

as

computation of the restriction

-indebtedness of school dis¬
tricts (5% of equalized
value) and
indebtedness of certain cities
(8%. of equalized value)- Prior to

Our

sufficient

effect validated by the decision.

the

of

valuation. All bonds

requirements

value to equalized value
the basis

the

showing

act

which have been voted in accord¬

stitution, approved in April, 1955,
which., changed
from' assessed
for

same

The

procedure.

a

provides that tax

In

held

time and at the

same

place, since the Court did not rule

have

getting
The

money

sizable

sea¬

and
and

securities

is

Telephones
Baltimore—LExiugton 9-4)210

New York—WHitehall 3-4000

Bell Teletype—BA

270

The Commercial and Financial Chronicle

Continued

from

.

Thursday, December 13, 1956

.

PAST

1955

-

PRESIDENTS

1954

56

55

-

-

CT.ARENCE

EMPEY,

F.*

The First Cleveland Corporation,

.

Cleveland

*'

>

'

LESTER

II,*

Harrtinan

American Trust Company. San Francisco

,

.%

•

EPPEEK.

GIBSON,

B.

WILLIAM

D«

DAVIS,
v

*

"f\

POWELL

(i.

»

ERGOOD,

C't[

inves'ment Corporation of

Norfolk,

;

J

Hill

Vj*

GEORGE

'

,

DAVIS, JOSHUA
Blair,A: Co.,

A.-

'

Mr.

Ar

Mrs.

Davis-

-

DAY, .JAMES
Midwest

E.-

'

''

:

Stock

DAYTON,

de

(Special to The FinahculCh.ohux.)

LOS
shall

S.
iq

ANGELES, Calif. — MarEibe, Delman E. Foiey,

the

Franklin

T.

Seventh

McSherry
Soldinger

Smithers A:

S,

&

gtaff

Company,

215

;

de

b>

"

>

West

Hentz

Robert

I

Ar Share Corporation,

De

J.

York

FRED

FARRfl.L,

Co.;

Los Angeles

Dawson,

T.

FINNEY,

York

'

DETMER.

JOHN

The

Parker

V

•

^

Corporation,

FLEMING,
:

J.

A.

FLYNN.

Win.

Investment Securities Since

CARL

lS(/j

II.*

Mericka

J.

Cleveland

Co.,

f

DOERGE,

JOHN

II,

O.

OI^DON,
Fordon,

A:

DOOLITTLE,

ROY

Doolittle

Co.,

A:

Moore,

Stern.

O.

'

Lynch.

Ar

Co.,

P.

FREDERICK.

NORMAN

Eastman

Co.,

Dillon,

3,

ROBERT

DKISCOLL,

GEORGIA

(Lord,
1-0316

LONG

DISTANCE

421

A:

Abbett

DROB.MS,

Co.,

30

W.

GEORGE

New

Washington St.,

York

Werlheim

&

A-

FRICKE,

Chicago

I

York

New

Ar

Ducournau

FRIEND,

New Orleans

Kees,

Co.,

DUNN,

May 20, 1893

C.

J.

STEWART
Devine

Ar

A.*

Co.,

Southwestern

Scott &

Stringfellow

EARI.E,
-*

American Stock

Exchange

HENRY

Eaton

Scott

Marion
R.

N.

Walter

Fitzgerald

S.

Thomas

Robertson
D.

James

Neal

Eldridge Longest

L.

Thornton

H.

Scott

William

FLAM.

Fleming

Boston

KENNETH

WILLIAM
Edwards

N.

Richmond, Virginia

Teletype RH 190

Telephones 2-7234 and L. D. 3

INS,

JOHN

Courts

<Sr

P.

Ft.

Worth

Kidder,

York

f

.*

Louis

Dealers,

Ar

HARRIS,

FRANCIS

Alester

JAMES

Ar

York

GANNETT,

THOMAS
Ar

GARDINER.

Atlanta

Reynolds

SHERMAN

Harper A: Son
MILTON

Ar Co., Seattle

Co.,

GARDNER, JOHN
Ar

and

A.

GARNER.

L.

Ar

Co.,

New

ELMER
Ar

York

G.

Co.,

Chicago'

Bank,

Vance,

R.

Gardner,

St.

Jr.,

GILBERT

HA WES,

Louis

Sanders Ar Co.,
HARDIN
Trust

L.

Finance'CoriToration,

ARTHUR

HAYDF.N,

Ar

W.

MUNICIPAL BONDS

LOCAL SECURITIES

F. W.

CRAIGIE & CO.
DEALERS

114 Third

Street, N. E., Charlottesville, Ya.

IN

MUNICIPAL BONDS

,

'

Phone

2-8157-8-9

Direct




-

Wire

to

Laidlaw &

Bell

Teletype—CHARVl

Co., New

York

95

616

EAST

Te-lepbone 3-9137

MAIN

STREET

RICHMOND

15,

Boston

Downing Ar Co..

MUNICIPAL BONDS

STATE and

Orleans

Savings Bank, Chicago

DONALD

Baumgartner,

New

II.*

IL*

NORTH and SOUTH CAROLINA

Philadelphia-Baltimore Stock Exchange

"

Dallas

White, Hattier Ar Sanford,

VIRGINIA

Member

York

M.*

National

IIAUSSERMANN,

York

-Washington

C. F. CASSELL & CO., Inc.

New

C.

VIRGINIA-WEST VIRGINIA

Dealers

.

'•

I.

MARTIN

1IATTIER,

M.*

New

ROBERT

>

A>

Jackson

Chicago

Becker

G.

Harris

Mrs.

B.

B.

S.
International

Mr.

Co.,

HATCHER, M.

Weeks, Boston

ROBERT
A:

Co.,

HENRY

IIASSMAN,

B.

Co.,

Research

FULLER

DAVID

HARRIS.

Greenville

Co.,

A:

York

Goldman, Sachs A: Co.,

First

Co., Philadelphia

New

F.

Funnan

G.

Sccu-ities

Ar

P.

W.

,

Globe-Dimocrat, St. Louis

B.*

Philadelphia

Co.,

Association,

A.*

Dwinnell, Harkness. A: Hill, Boston

HARRIS,
New

■

York

WALN

E.

HARRINGTON,

II.

Exchange.

R.

New

Bankers"

Harrington Ar

Securities

C.

Boston

IIARKNESS, ROBERT
.

l

Peabody Ar Co.. New York

GAELIVAN,

Co.,

WILLIAM

National

"

New

Co.,

MURRAY

Corporation,

KEITH

GALLAGHER,

Co.,

Reinholdt

EMRICH,

'Denotes

Distributors

St.

'

GEORGE

Jr.,

Ar

Baxter

N.*
Ar

Julien Collins Ar Company, Chicago

Underwriters

IIAPP,

Chicago

NEAL*

WILLIAM

Ar

Washington

v

HARE,

Denton, New York

Piddle

Hornblower

ELLIS,

Wm.

Clark, Dodge & Company, New York City

to

Yarnall,

(

G.

ROBERT-K.*

Jr.,

Investment

-

Company,

Stock

Exchange, New York

GUS

DOUGLAS

Shields

;

RALPH

ELLSWORTH.

Private W ire

York

R.

Weld

Bache

G.

}

Richmond

Winthrop A: Co., New York

White,

S>

GALLAGER, HERBERT V.

Elkins, Morris, Stokes

Building

New

C.

Sweijgy. Cartwrieht Ar Co., Columbus

Joseph J. Muldowney

ELK

115 Mutual

FUNSTON,

Shelby Cullom Davis Ar Co., New York
EDWARDS,

Buford

Atlanta

Washington

F.

Richmond

C.

Inc.,

Stock

HAMMOND,

Association

of

Nashville

Robert

HANSEL,

W.

Inc.,

JOHN

York

HANSON,

WALLACE

National

Howard,

A:

III,

IIALLORAN,
:

.

S.

Jr.,

Trust

Association

C.»

Equitable Securities Corporation,

Corpoi ation,

News,

Ar

Houston

First, of Michigan Corporation, Detroit

EBBITT,

Exchange

York

E.'Sv

Dallas
Bankers

EATON, Jr.. CHARLES

Exchange (Associate)

Richmond Stock

Company,

FULTON,

Members

New York Stock

*

Securities

1'IIARR*

Mosle Ar Co.,

Retail,

New

arnk

Bros.

FULKERSON.

DUSON, C.

Jr., JOHN

HALLIBURTON,

Flerning-W. B. Hibbs Ar
Washington

Burns

Dealers

IIAIRE, JOHN

Nolan.

FUG lest ad,

E.

II.*

Mason-Hagan,

Milwaukee

Philadelphia

Chicago Daily

York

New

DUNN, TIMOTHY II *

'
'

Mason-Hagan.

McCREA*

CHARLES

Corporation,

P,

Toronto

New York

Co.,

FRYE,

Established

Angeles

O,*

New

ARTHUR

Folger,

DUFFY, SYDNEY

Blyth

Los

Hess <V Frederking, Houston

P.*

J.

Ar

Fox,

York

EARL G.*

Fritlley,
DUCOUKNAU,

A.*

KURT H.*

Hanseatic

NIGEL

Canada,

.

Co.,

RIDLEY,

THEODORE

DEAN

IIAGAN,

New

Crawford,

c.

Co.,

H.

York

JOHN

Investment

Seattle

THEODORE*

JOHN

Bache

allen

Dubois,

Or.fi

PAUL

J.

!

,

H.

WILLIAM

Clemens

GUNN,

S.
French

JACKSON

Detroit

Securities

J.

Bank, New York

York

York

GUNN,

York

FRENCH,

R.*

Eppler, Guerin Ar Turner, Dallas

Meyer Ar

II.

American
New

York

America, San Francisco

York

HAG AN,

Co.,

FRKKI.AND,

Securities Ar

of

GUERIN,

S.

Union

York

New

A:

'

t i

..

Cunningham, Gunn & Carey, Cleveland

Co.,

Ar

II,

New

FRED*

Fox

Bank, Fort Worth

WILLIAM

III,

GRUNKBAUM,

"

Frank.

P.
F.

Eaxter

BUILDING

Jr.,

GRIFFINGER,
Bank

FRANKE, HAROLD A.
'ihe Milwaukee Company,

Washington

DOWNEY,
RHODES-HAVERTY

ATLANTA

'

.

Pittsburgh

LESLIE

Folger. Nolan, Fleming-W. B. Hibbs Ar

Humphrey Company, Inc.

B.»

Buffalo

Leonard

SHELDON

New

Marshall,

ABE

FOX,

DOUGLAS,

Ar

New York

W.»

ERNEST

DORBI1Z,

-

.

Cleveland

ALBERT

Foster

Dominick,

FOX,

The Robinson

'

,

J.*

Aliiinger

FOSTER,
BAYARD*

Doininick

;

Morris, Stokes Ar Co.,
Philadelphia

Worcester

Co.,

I

,

Elkins,
Pittsburgh

RALPH

Saunders, Stiver & Co., Cleveland

DOMINION,

A:

"

■

San Francisco..

Gregory Ar Sons, New

LEONARD*

McDonald

&

f

Yor£

York

Weeks, New York

Hogle A: Co., Salt Lake City

DOERGE,

V;

v

Gregory Ar Sons, New York

D.

N-.-

Hanrahan Ar Co.,

Hornblower Ar

U.*

Co.,

BRADLEY

GREGORY,

Boston

HERBERT*

.

GREGORY, GEORGE M.

FLYNN, GEORGE T.
DEWITZ,

J,

GREEN,

Ltd., Toronto

Scribner,

CHARLES

/•

.

'

v.

V

Gregory Ar Sons, New

ROBERT W. ;
Blyth «Sr Co., New York

CHARLES

DEVENS.

Cliicago

FISHER.

F.

M.--

'1
•

Houston

Guaranty Trust Company, New

Co., New

Ar

'

"

-

City Bank, New

The First National

GRIBBEL,

Hemphill, Noyes A: Co., Chicago

of

WALTER

GREEN,

BKADSHAW

Deane

V

Haven

K>

CHARLES

Singer,

Atlanta

GRAHAM, T. E.*

J.*

York

Ingen A: Co., New York

.

E.

Co.,

The Chase Manhattan

Ar

,

GKAIIAM, JAMES S.*
'/
"
Allison-Williams Company, Minneapolis

W.

HOWARD*

Greenshields

FISHER,

Distributors And Underwriters

r

'

Bankers Association,
' ' '

Walter C. Gore

GREGORY,

WALTER*

L.

Van

J.

GOREY,

-'1',. J;

Co.,

;

^

^

*

H.'

DAVID

Investment

:

:

.

■

•

Reynolds A; Co,, New

B.

^

'

:

Corporation,, Chicagb

First National

GORDON,

Stearns fc Co., New York

Bear,

v,'c.'-

,

\*

The

■

Washington

Hannaford.

riRSTBROOK,
WILLIAM

■

p'M

T

ARTHUR

.

b.*

Jr.,

Higginson

-

JACKSON

A.

"'

-

Angeles

Evans.Ar

Jr.,

GOODWIN, ROBERT

i

D.

F.

Lee

'

-"

'

*

f

York

Lik

Rowles, Winston A:

City National Bankf Kansas City

Townsend', Crouter Ar

Ar

New

F.

-

/.*■'

1

ELLIS"

R.

Clement A;

*
Bank,

Whteiir.g

Barney Ar Co.,

I ARRELL,

Baltimore

New

GOODWIN, Jr.,

Chicago

Co.,

Chicago

New York

WAVNE*"

W.

GOODWIN,
r

:-U:

-

Corporation. New York

IIOl.DEN

Smith,

G.*

WALTER

DEMPSEY,

"

^

DOUGLAS

WILLIAM

1 ARRAR,

Sons,

Eichler Ar

Haven

Bodine,

DEVLIN,

Atlanta.

National

Co,

Ar

AIRMAN, Jr.,

FALSEY,

L.

Ar

MILLARD

HAVEN,

;*.V

W.\

ROBERT

Bat-he Ar

New

RALPH

Laieman.
De

Co.,

Garrett

DeGROOT,

York

Cbasi W. Scranton Ar Co,, New

Ar

DeGROFF,

Street.

}.

New

'v*;

Master)

Discount

'

New York

H.

BRONKART, EUGENE
H.

E.

Co.,

Ac

GOOSJIALL,
-

i

FA1RCI1ILD,

Indianapolis

been

samue,

qf

EWING,

New York

Co.,

RICHARD

-

••

'

everts, Jr., albert P. .... f
Paine, Webber, Jackson A: Curtis, Boston

A.

Indianapolis Bond

and

Jr.

have

-Chicago

-

" ;

'

New York

MARQUETTE

BAKY,
F.

DrBOLT,

Charte T

}ff V';'

Blyth

California Baiih.

V-■

Illinois

Co.,

D.

C.iAllyn Ar Co.; New York

PLOVER,

Evans Ar- Co.,

Continental

DEAN, HOWARD B.

Harris, Upharn Ar Co.,

Harry

•

Chicago

W.

Clark. Dodge Ar Co.,

T. Jerrold Bryce

>

,

Exchange,

Jr., JOHN

'

Ar' Co.,

thomas' W."

evans,,

Shelby Cullom Davis & Co., New York

"V '

W.

C.
A:

GLASSMEYER," EDWARD
'

t'lfm e nt Ar.

Clement A.

CULLOM

SHELBY

DAVIS,

W.

J

St. "Louis'

CAR NOT

Clark, 'Dodge

V >;Va ns,.

Geoige

f-vA.

Jr.,

IVANS,

I'"'::

'

:

'

>

Detroit

GILLIES, GEORGE J.

/

.

ALLAN G.
Bpencer "Tra.sk "Ar Co., New York.

;

York'.-, c

New

DAVIS,: miss NANCY

,

*

>

* GEORGE" H *.

Brothers,

EL'STIS,

Davis, Skaggs & Co., San Francisco

With

Stroud Ar Co., Philadelphia

I R KER,

Norfolk
DAMS.

m.V;*

RUSSELL

Jr..

Ripley

RICHARD

Leivmdn Brotners,

Epplet', Cuerin Ar Turner, Da Has

*

Angeles

mpsey-Tegeler Ar Cp., Los

Co.,

*

*

DAVIS, DONALD IV.

Four With Franklin

A:

GEORGE, EDWARD
DAVIS.
.

Walter A. Schmidt

I.

GEDDES, EUGENE M.
?
Clark, Dodge At Co., New York

54

;

George W. Davis

JOSEPH

McDonald-Moore

In Attendance at IBA Convention
1953

,

Hayden, Stone- a: Co., New York
GATZ,

IBA

'

GATCHELL, EARI.E*

32

page

.

VIRGINIA

Teletype RH 83 ic 84

Baltimore

Volume

Number 5594

184

HAWls; MILTON- J.
American

HAYES,

'

-

Street

Washington^

Journal,

York

New

K.

JOIIN

c.

■"><

r

GORDON

National

F.

»-•'

E.

S.

Angeles
'

»

-J.

K.

JOHN

HOPKINS,

iii/ici, New York

^

.Scott,

-•:

NEMAN,

Common" ealih

Trust

-

T.EKT

II.

A

C.

*

-

"v

-1

C.

Henderson

HERBERT*

&

Qp./Dcs Moines.
V"

THOMAS .!.»

^

'

i

*

Hugh

\v.

l ong

1IER/ER, KARL P.

;

St.

Woodcock,

V

-Francis

I.

IIEWTTT,
Jones,

Hess & Co.;

duPjnt St

Schneider,
IIII DRETH,

-lali,

Washington

HUGHES,

MALVERN

Malvern

Hill

IIILI.IAKI),
B.

J.

X.'

■

Co.,

New

Wortheiin

St

IIIIISCHFEI.D,
Stranahan,

St

v.

*

Co.,

O.

York

New

t

Fful'..

ROY
'

-

HUNTER,

I

'v""V

Cincinnati

EDWARD

MCivIaliou

IIOBPS,
Russ

Sc

1IOLLAN,
Barr

St

Jr.,

F,

HURLEY, .WILLIAM

Hoban, Chicago

WILLIAM

Co.,

San

Antonio

St

New

F.

York

Mr.

and

E.

W.

Mrs,

KURT

L.

W.

,

Detroit

DANIEL

KENNEDY,

Los Angeles

JAMES 1vf.
Hutton 8t&Co., Cincinnati

J.

J.

B-akcr,

JAMES

J.

Canada,

Chicago

Co.,

KNOOF,

DISTRIBUTORS

—

PUBLIC

Halle

PHILIP

Childs

F.

Richmond

•

Allen

'

-

'

1

Teletype RII 460
'

f

—Branch
702

Colonial

American

Natl.

Bank

'

'

'

Office—

Bldg.,

me.

JOHN

Unlisted Securities

Trust Company,

IV*

Labouisse, Friedrielis St

Underwriters

Orleans
JOHN

LANAIIAN,

A.
New

Co.,

St

& Distributors

York

WALLACE
Boyce, Baltimore

W.

Jr.,
St

Bros.

Municipal LY 82

Municipal. Bonds

G.*

WILLIAM

Brothers

W.
Kirkpatrick,

BEVERLV

III,

LANDSTREET,
Clark,

W. VA.

Co., Cleveland

St

Magazine,. Chicago

New

Stein

Rcanoke, Va. Telephone 2-3101

1
in

Corporate LY 62 & 63

GEORGE

Jr.,

GRUA,

Barr

•

Corporate Stocks and Bonds

Fidelity-Philadelphia
Philadelphia

Co.,

N. CAR.

Chicago

JOHN A.

LAP.OUISSE,

LA

Telephone 2-2841

Jan.

Telephone 8-2821

VIRGINIA

York

New

Co.,

St

Howard, Weil,

If), Va.

on

partner

York

New

F.
Co..

St

1

Finance

E. Main St.

limited

firm.

IRVING

KOERNER,

KURTZ.

1110

Doheny
a

CaMJ^/tcAlru/iy

B.*
York

,

Prcscott, Shepard

Philadelphia-Baltimore Stock Exchange

H.

become

Washington

New

Banks,

Land

KUFRIN,

Members

the

Hut¬

1932

of

Association

T.*

JOHN

Federal

KRUSE,

MASON-HAGAN. INC.

in the

E. F.

Company..

William
will

of

LYNCHBURG. VA.

Stieglitz,

St

KNOX,

C.

AND REVENUE BONDS

&

PETER
Parker St Redpath,

A.

KOKNIG,

VIRGINIA AND GENERAL MARKET MUNICIPAL

ton

York

New

UTILITY

SECURITIES

Orleans office

a

Bright,

will make his headquarters
New

is

who

Auchincloss,

DEALERS

BANK & INSURANCE

RAILROAD

York

Tullis,

Mr.

partner in Tullis, Craig &

Ii.*

KNOTIIE, STA.NNARI)

INDUSTRIAL

in the firm's New

Toronto

Department of the Treasury,

UNDERWRITERS

and

City,
Stock

SCOTT, HORNER & MASON

Boston

A.

GEORGE

KNEASS,

Hawling

Mr.

Exchange.

York

the New

New York

Corporation,

Dealers

Investment

'k-.*

Jr.

Hawling,

partnership, George

office, 1 Wall Street.

S.

Boston

KINGSMILL,

H.

Henry

C.

of

York

New

Broadway,

members

F.«

whi
hippie St

First

The

Armour,

Gerard

61

D.

FRANCIS

KING,

Stanton

ship in E. F. Hutton & Company,

New York

Weeks & Co.,

Bacon,

'"i

admit to

1

J.*

WILLIAM

KERR,

quarters

New York

Co.,

Tullis, member of the
Stock
Exchange, on.

York

New

Easley will make their head¬

London

T.*

Kenny St Co.,

KERESEY,

1

Sr

JOHN

and

Easley,

Mr.

M.¬

FRANK

Dc•,1n<,

J

C.

KENNY,

Jr.,

?■ ■i»rr rs

EDWIN

A.

Securities Corporation,

KENNEDY,

T.

and to limited

York

New

Ex¬

will

Jan.

Kennedy,

L.

Specht

C.

Abbett St Co.,

KENNEDY,

J.,

Ralph

Paine, Richmond

St

on

partnership

Louisville

GEORGE S.

Proctor

Stock

Midwest

and

changes,

Boston

Co.,

&

Jr.,

Midland

Philadelphia

La

York

New

P.

Abbott,

"5

South

231

Jan. 1 will be admitted to partner¬
York

T.

Lyons <fe Co.,

Lord,

Co.,

Corp.,

C.

Exchange,

WILLIAM

F.

KEMP,

-

Stock

Estabrook

UH
Co.,

Ristine St"'Cbv,

P.

HUTTON,
•Denotes

St

'

Walterj«fe Htpry,

IIUTTL1NGER,

Co.,

H

Securities Dealers,

HARRY' W.f" "

Bingham,

V,

JOHN

Brothers

Simonds

Baker,
HURRY,

G.

'

&

Garner H.

Mitchell,

—

Salle Street, members of the New

York

KEMP,I

*■■■■■*•

Pittsburgh
IIOBAN,

■

RANK^II^- ' £ r

'.ssociafion

'

. ..

York

»

Management

JAMES

III,

KEMBLE,

Co.^Grecnville

i

-

W.*

Harris St Co.,

:>

•«-yN3h".,-:New

V\ el

Jr.,

Hutchins

A.*
Shares

111.

CHICAGO,

Chicago
KELI OGG,
New

G. H. Tullis to Firm

Admit New Partners

B.

ivitller. Cleveland

oi

PAUL

JUST,

•

i
^ittsburghv
f

JANSEN5""-;:-^

lute,

HUNT,

Angeles

G?*";' *

regor,

-

HERMAN

Television

A Durst,..Los

Si

-

&V

WILLIAM

E.

HUNT,

Louisville

Son,

S.

JOHN

Inter

i

York

IIENNING*

Hilliard

HII.SON,

Huglies-A Co.,

MILTON

HULME,

Louis

Co., St.

St

E. F. Hutton to Admit

Mitchell, Hutchins to

D.

Hartford

Co.,

St

uuiiiTU,

V

* Wagcnseller

,

/

.

St

Cooley
JOSEPH,

SHANNON*•

W.

HUGHES,

Peoples National .Bank,

HILL,

•

Marks

St Co., Savannah

S))aee

Jones

M*

M.*

mt«'i i)o

Indianapolis

:

■

D.

Laurence

Joseph T. Johnson

Ewing T. Boles
\

York

New

it-Co.,

EDWARD

Edward

,

> :

C.

THOMAS

John.;on, Lane,
JONES,

»-.V

Ki^us. Cleveiand '

Raffcnspe-pcp,

Dallas

S,*

Charlottesville

HyX

f

VV^..;.

St

:

Milwaukee

Company,

Peabody

Kidder,

"?

Chicago

T.*

ROBERT

JOHNSON,

ALBERT U7»"
tl^ird. Ahbctb Zz t^>., Neir York

Hickman,

Bernet &

FRED

Burge

National Bank,

JOSEPH

Milwaukee

HUGHES.

Chicago

W.

y.";-'. ,vi-

f

J..1

EDWARD

First

JOHNSON,

Clinpn^fl Sc ?o., Ciiicago

HUDSON;

XXX

WESLEY

J.

*

vX'X 'h

,

Philadelphia

Tlie

'

Dallas

-v:...

^

"■'%' '■v'".V
Kirkland", Grubbs Si Keir,

Jenk8,

The

M.4rH :"X." XX"-' ''S'''

JAMES

*

V';-

Minneapolis'1
' j f/-' "fjf.f JOHNSON,

;C

>

Chicago >„;

JEN'KS, MORTON"

l-

New.York

G>

P.

v
Staats St- Cu„; I.os Angeles

R.

JENNETT,

>

•

EARt.E*

Jr., J.

Vt.fl wflliam
V'

^
'

.

^P-'X

.

CJlore, Porgan Si Co.,

JARMnE;

-*■;"

Hop wood,

Sc

ROBERT

Far ." ell.

York

New

III,.MATTHEW J.

Ilickcy St Co.,
HICKMAN.

J.

Co.,

'

,

Company,

JAMES

JAMIESON,

-

F.*

Southwest

Firit

*.
*v

New York

Tribune,
r.

;Reyn-lds.& Co., ^NewrYork

■

HOWE,

Krceger & Hewitt,

IIICKEY,

The

Philadelphia

A".'*"

MAX

UA

*

Cot, »tvfe\v-ydrk

JAMES

JACQUES,

.

'"fY"

Harris, Upliam
IIOWAF.T,

L.

CHARLES

51

Crocker-Anglo National-Bank,

-'.vi

GEORGE lli

Jr..

HOWARD,

Winslpw, C hu St Stetson, New York
HEStf. ARLEIGH P> "■
HEWITT.

-

Company, Dallas"

JACOBS,; Jr.,' HARRY-A.

„

EDWARD"

C.

Jaffray

Piper,

Elizabeth

St Co.,

York Herald

New

HOWARD.

-

.

1950

1951-52

53

-

Philadelphia

San. Francisco

.

V

■*
Loufs '.V-

•

.

RUSSELL.*

HOUS.MAN\

l>
-

T.

1952

B.

ALGER J.*

Bache

;
Lynchburg

burpihj;

llF.NDLRSOXr THEODORE

York

New

Co.,

WILLIAM

Jr.,

Southwest

First

JACOBS,

•' V

Penington; Co'.k^t .Af.'Go.,'PiiilatP lijhla
-r.>
\
,
HLLI.I'.R. JAMFS M.
; *^y
v
I'vv f V/X * ilOIH.Il, WILLIAM R>
;
Shearson, Hammill &.Co,; New York
'> ■\Z Beil '& Hough. St. 'Petersburg

,,Pitt.

T.

Sz

LAWRENCE

JACKSON,
-

"

•

Co.,

St

ARTHUR

1H»RT0N,

Company.

•

Mason,

St

Niclatts

Sliiel,

*.'•■' '-v'.

I\*

Horner

IK/R\ItXG;

■

A.

Jr.,

B>

EDWIN

HOUNElt.

f

Walter, Woody St Heiine.dinger,'- •'
Cincinnati
II LI

; •

..

^

VV:i.r

York*- /.

Weeks, New

.

M>

JOHN

■■

PRESIDENTS

PAST

IBA

York

New

Penington, Colkct St Co.,

RALPH

Jr..

Hornblowcr St

,

ici;h

».
,

;4

-

Langley

ILI.OWAY,

•

HLFFLKNAN,. PAUL*
we a-

"

MAITLAND

C.

York

Ne v

A.

'

IIORNKI OVV1R,

IIEI.MLRDINGI R,

IJAMS,

•

*

Co., New York -

Morgan

U.

Bank, Cleveland V,

City

■-

-.•• -

Betldchem

EDWARD s.*
.,
Hope <X Co., JjSan Diego

1IOPE,

'■

Los

Co.,

&

P.*
C'ori>oration,

Steel

Bcthljhcm

.

Dempsjy-Tegcler
EFFLUX,

Association,

W.
Hutton Sc Co.,

E.

W.

S.-

'

& Co.,

Hcrrman

IGLEIIART," J.

.

W.

ARTHUR

IIOMEIt,

P.

Adamex Securities Corporation. New York

11

MRS., JENTRY

E.MI\S,

HINDON

J.

Henry

'

-

Washington

Republic Company, Chicago

HEAI.Y,-GEORGE

IIIiCliT,

;

Investment -Bankers

HAYS, IIDDE
Central

IIO

HYDE,

a

S.

Finance Corporation,

TInternational

.>

PHILIP

Wall

JE*TRV

HOLMES,

•

Bank,-Chicago

National

91

(2587)

and-Finartcial Chronicle —

The Commercial

.

I andstrenl St

Nashville

LARKIN, THOMAS
Goodbody

York

New

F.

JOHN

S.

Moseley

LEACH,

R.

T.

St

White

J.

WeeksT^Chicagd

Co.,

York

New

Municipal-Bonds and Corporate,

K."

IIAROLI)

D.

Chicago

St <fo.,

St

ORIN

Estabrook

Kansas City

VVII.LIAM

Jr.,

Hornblower

1

,

Co.,

G.*

IIAROll)

LAW I AYR.

LEAF,

St

Hutton

LA UN.
F.

C.

Lynch, pierce, Fenner St Beane,

LATSHAW,
E.

York

New

WALLACE

LATOUR,
Merrill

A,

Co..

St

St

New

Co.,

York

Securities

JAMES

LEAR,

Reed.

Lear

LED YARD,

St

Q.

Co.,

Pittsburgh

__

Local Industrial & Utility

It.

Nashville

LEE,

JAMES

W.

LEES,
Ira

UNDERWRITERS

E.

MAIN

SPECIALISTS

• *ANCM

OFFICE:

RICHMOND

VIRGINIA

MUNICIPALS




OFFICE:

CHARLOTTESVILLE

New York

Co..

St

Co.,

Retail Distribution

HUDSON

York

New
B.

New York

Morgan Stanley St Co.,

LEVERING,
IN

A:

LEON*

Haupt

LEMICAU.

DISTRIBUTORS

Trading Markets

J.

Hutton

Jr.,

Carlislc

LeVIND,

Blyth

LEWIS,

St

It.

WALTER

STRADER and COMPANY, INC.,

IV-

Jacguelin.

New

York

GEORGE

St Co.,

New

York

GUY W,
First National

Peoples

Stocks

Securities Corporation,

Equitable

LYNCHBURG, VIRGINIA
-

Bank.

Continued

on

Pittsburgh

page

92

■

10

39

—

5-2527

—

TWX LY 77

92

The Commercial and Financial Chronicle

(2588)

Continued

from

MORTON,

91

page

Thursday, December 13,1956

.

.

.

Blue

W.

In Attendance at IBA Convention

PRESIDENTS

PAST

IBA

H.

1948 .49

50

-

LEWIS,

1947 -48

MILTON

F;*

G.

Becker

St

LEWIS.

SALIM

McKINNEY,

I,.

A.

Co.,

MISS

Investment

Walker & Co..

McLaren,

Stearns & Co..

Bear,

LINCOLN,

H.

G.

York

New

New

iiarris

McDonald &

York

St.

Ml

b.*

LDOWNEY,

JOHN

S.

MEAD,

The Chase Manhattan

ITTTLE,

ALDEN

Investment

Bank. New York

W,

II.*

With

Association,

Maj.

Gen.

Washington

LIVINGSTON, J. A *

'

E.

MENDEL,

I.OCKETT,

MERRELL,

Jr.,

JOSEPH

Masten

Townsend, Dabney St Tyson,

LOEWI,

J.
St

Co.,

LOKAY,

Albert T. Armltage

Hal

H.

Julien H. Collins

Dewar

Lee

Boston

VICTOR*

I.oewi

Mu.nko,

Bragdon,

JOHN

john

•.

Shearson, Hammill & Co., New York

LONGMIRE, JOHN
I.

M.

Simon

St

MIKHI.S.
Louis

St.

LOOMIS, CHARLES II.
The First National Bank, St.

LOOMIS,
The

Piper, Jaffray Firm
MINNEAPOLIS, Minn.
Jaffray

&

Seventh

Hopwood,

Street,

—

115

members

Piper,
South

of

the

Neil

Mr.
firm

Jan. 2

on

Gilman,
Gilman
for

Jr.
has

will admit

to

H.

partnership.

been

with

the

Schirmer,
members

Exchange

LOW,

them in Billings, Montana.

the

Jan.

on

Co.,

York

Stock

will

New

&

admit

1

Exchange,
Miller

who

has

been

McCormick

Cosgrove Miller & Whitehead,
make
his headquarters
in
Nevy York, ~v -

LYKLEMA,
I A.

same

C.

Co.,

New

York

New

Co.,

York

Co.,

date.

St

New

New

Leonard

Mercantile

Locb

St

Co.,

Richmond

Fahnestock

Chicago

MOORE,

New

York

Trimble

A,

G.

The

Lynch,

F.*

Pittsburgh

Mitchell.

,«

Bank,

The

Dallas

EVANS

New

Allen

&

LYONS,

Investment Service

Co.,

SAM

Finance

Eighty-Four Years of
.

MACKALL,

•

HILLIARD & SON
ESTABLISHED

.

Tax-Exempt Bonds—Investment Grade
419
>

W.

Irvin

Hotel,

Paducah,

Ky.

—

New

Masonic

Coe,

Owensboro,

MARKS,

MORSE,

1

Marks

GEORGE

ARNOLD

Spence

St

Jr.,

New

Louis

St

Co.,

Co.,

The

C.*

Sentinel,

CHARLES

F *

Northern

.i:

MAY,

St

Co.,

J.

National

Bank,

a':V\5

Co.,,. New York

Northern .Trust

Thomson fit

...

.»

Corporation,

Boston

OSBOItN,

II,

&

OSTRANDER,
William

E.*

OTIS,
1

^

\y.y-.

Blair

St

Bond

York

Midwest

Stock

Co.,

York

Exchange

Exchange

Direct
&

Co.,

New York

»'•'

Private

Wire

to

Between

Goldman,

Offices

Sachs

&

Co.,

New

York

MARTIN

Hemphill, Noyes & Co., New York

McCALL,

ARTHUR

Alester

G.

Vance,

C.

Furnian

MeCANDLESS,

Co.,

JOHN

Sanders St

McCarthy,
First

San

Greenville

A.*

Co.,

dennis

The

Long Distance 233

Boston

:

-

h.*

Francisco

Eoston

Corporation,

McCONNEL, Jr., VV. BRUCE
Singer, Deane & Scribner, Pittsburgh
McCORMACK,

\y

H.

Hentz

FRANK

&

Co.,

»

J.

New, York

i

>

SOUTHERN

;

McCORMICK, ,D. DEAN
McCormick

Kentucky Municipal Bonds
*

Van

J.

R.

Morgan

W.

The

WILLARD
Mrs.

E.

P.

C.

JAMES M.

ROBERT

LEWIS

H.

JOHNSTON,
E.

PURYEAR

OSCAR

McKELVY,

I'

m.

i

»

1

New

York

C.

MARKET

MUNICIPAL

BONDS

New

York

II.
&

York

I).

Trust

Company, Chicago

WILLIAM

T.

Dominick, New

WILLIAM

McKelvy St Co.,

York

M.

Pittsburgh

Stubbs, Smith & Lombardo, Inc.
BIRMINGHAM

3, ALABAMA

Jr.
STEPHEN

G.

WRIGHT

Chas.

McKIE,
t.

Co.,

EDWARI)

Northern

McKEON,

ROBERT

FETTER

Co.,

GENERAL

B.*

CONWAY

CHARLES C. KING

McNAIR




M,

&

II.

CUSIIMAN

Dominick

BOHNERT

New York

Pressprich & Co., New

McINTIRE,
POWHATAN

Noel &

DAVID

McGREVV,

HECTOR W.

T.

WILLIAM

Jr.,

Alstyne,

P.

McGEE,
DEPARTMENT

GRAHAM

AND

Chicago

American Stock Exchange,

McELROY,

THOMAS

Co.,

McCURDY, WALLACE M.*
Thayer, Baker St Co., Philadelphia
McEI.NEA,

INVESTMENT

&

McCORlVHCK, EDWARD

Local Securities

v

The
*

W.

Scranton

STANLEY

Weil,

Roth

&

Co.,

New Haven

G.
St

Denotes Mr. and

Irving Co., Cincinnati
Mrs.

Telephone ALpine 2-3175

Teletype: BH 257

•

:!

"V

Chicago^iv.

^

Buyer. New

Montgomery
Wires

-

"Y:''

CORPORATE

Stock

f
'

Simmons, Chicago

LEE

:

,

? I;-'?'/ -JC:

;

C. BARRON*

The

-

and

New

'

k

JAMES.

Blunt Ellis

J

L.

^

Washiiigtoit

Dominick &*Dominick, New York

OSGOOD, GILBERT H.

Private

WALTER

Shearson, Hammill
McANDREVVS,

>

y*.

.<yr

WAYNE -C.*.;

Birmingham

DENNY

Parker

/-.*

^

Company, New. York

McKinnon/.New York-

:

OLIVER.

Company, Chicago

Members

Seattle

'
:

STERNE, AGEE & LEACH

Chicago

i':

New -York

WILLARD*

Pacific

The

Company,

-

* **'• '•**•

O'KEEF, ROBERT-II.*.,;'!.
The Marshall Company, Milwaukee
'•?
>

-

C.

Members

Trust

;

'

i

'■

U. S. News &-World Jleport,

Brothers, New York

M.

MAYNARD,

LOUISVILLE 2, KENTUCKY
Teletype LS 186

'

MUNICIPAL

Winston-Salem

^

~

Co.; Nashville

Atlanta

Bank,

The

Bell

&

Milwaukee

JOHN

MAXWELL,

KENTUCKY HOME LIFE BLDG.

^

GEORGE

The

FLOOR

i

SECURITIES

Wachovia

1st

-

'

MAXWELL,

Exchange

<

O'HARA. -WALTER .T.;

Philadelphia

.

Toronto

ROBERT

Company of Georgia,

MATTON,

Midwest Stock

F.

*.

'

Underwriters & Distributors-of

New York

r

<

J.'1

ALLEN

Mabon- St

Association,

B.

Milwaukee

•.

DANIEL

York

New

.

-*•

O'DAY, DANIEL*

York

Company, New York

York

'

•

.

'.'V'

CHARLES

WALTER

Lehman

L.

Bank,

Ky.

Trust

Member

Jr.,

*

*

Co., St. Louis

M.

MATIIISON,

.

A.

;

Washington St.,-.Chicago

Bradford

Riter

Hemphill, Noyes St Co., New York

W.

Corporation,

Laurence M.

MARTIN,

Mills,

.

MORSE,

Washington

LAURENCE

MATHEWS,

INCORPORATED

&

MILTON A.
Bennett & Co., Detroit

Manley,

Discount

BANKERS BOND ^

GEORGE

Webber, Jacksoh St Curtis,

MASSEY,

—

York

'

York

International

Building,

New

MARCKWALD, ANDREW K.*

Common Stocks

St.- Louis

NUGENT,-JOSEPH C.

\

Northern Trust

ROBERT

^

V

Walker

W.

C.

NIX.

G.*

Bankers Trust

LUTTRELL

Paine,

I

JEFFERSON ST., LOUISVILLE 2, KY.

Cobb

The

PAT

MORRIS,

Weir,. Inc.,

WILLIAM
&

MANLEY,

1872

Member New York and Midwest Stock Exchanges
Associate Member American Stock
Exchange

y
*

New York

McLeod, Young,

H.

111

J.

Chicago

.

B.

MacDONALD, GEORGE C.*

MACLIN,

y'V

MORRIS,

,

^

S..

Co.,

St

II.

Magazine, Chicago

Mackall

J. J. B

Investment Bankers
'

],/)■'■

L.*

Cook

L>

ArCo.,

Washington

FRANK

G.-*

Bank,

WALTER

Yantis

York

New

CHAPIN

NICHOLSON,

MORRIS, FRANK E.*

Sterne, Agee & Leach, Birmingham

LAURENCE

Co.,

-

Wellington Company,

S.

Philadclphl*

D.*

Edwards St Sons, St.

Hanover

.

New York

LYNN, HENRY: S.*

LYONS,

&

NIELSEN, FINER

MORRIS, CHARLES K.
F.

:*/ -

-Wcrtheim St Co.,

In Louisville Since1872

NEWTON,

York

"

.LYNN, EUGENE*
2

Hentz

D.

New

RODERICK

MORGAN,

::

.

National

C6.,

MOREY, RICHARD

MORGAN,

Inc.,

R.*

J.*

URBAN
St

*

LINTON*

NEWHARD, HARRY W.
Newhard, Cook & Co;, St.'Louis
&

Branch, Cabell St Co., Richmond

C.

St

Jr..

-ffl'...

Distributors,

PHILIP

Newhard,

Co.,

:

,

Newburger St Co., Philadelphia

T.

SIDNEY

Jr.,

MOONEY,

New York

York

York

MOIIR,

York

THOMAS

LEWIS

St

-' 1

*

V.

Co.,

Underwood, Neuhaus St Co., Houston
H.

G.

CHARLES M«K.*
Leonard <fe Lynch, Pittsburgh

Moore,

LYNE,

,/,

Co.,

&

NEUMARK, ARTHUR j.*

GORDON

DAVID

Chronicle,

-V"

W.

Delaware

NEUIIAUS,

Thornton, Mohr St Farish, Montgomery

St

WALTER

HI,

Wheat

C.

Kuhn.

Jr.,

Moore,

LYNCH,

NELSON,

Chicago

MITCHELL, JOHN N.
Caldwell, Marshall,

Allyn & Co., Chicago

LYNCH,

John Porteous II will withdraw
the

Read

York

M.

New

I..

;

t

.

LESTER

NEWHARD,

LUNDFELT, CHARLES E.

will

on

St

&

Co.,
Jr.,

MIKALIA,

THEODORE

Stearns

Dillon,

in

from the firm

J.

• »-

HJIHN, JOSEPH

Mr.
partner

a

Boston
E.

LUBETKIN, LLOY.f) E.
Seligman, Lubetkin St Co., New York

partnership.

to

Brothers

V.

Bear,

Carl N. Miller, Jr., member pf the

time, representing

some

of

Atherton

& Howard,

&

'

:

\

Piper, Jaffray &: Hopwood. St. Paul

DUNCAN

MILLER,

.

York

NEUBURGER, Jr.,

J.

^

MURRAY, Jr., WILLIAM N.*
The Illinois Company,
Chicagp

Mullaney, Wells & Co., Chicago
Laird

;

,

G.

Co.,

CHARLES

MILLER,

MALCOLM

Barr

Admit G. N. Miller, Jr.
■

New York and Midwest Stock Ex¬

changes,

Eatou

LOVE,

i

Paul a,

S.

LORD, Jr., ANDREW

Schirmer, Atherton to

To Admit Gilman

JOHN

Illinois Company, Chicago

:

,

,

MURRAY, LEONARD A.

Cleveland

MAURICE*

Blair St

MILLER.

-y

Research

Financial

&

York

MURPHY,

II.

DONALD

William

-

^

Pittsburgh

&

E.

Barr Brothers

RUSSELL

Hirsch St Co., New

R.

Co.,

New

New York

ROLAND*

Jr.,

V

'

1

V.'';

.

Corporation, New

MURPHY, II.

Higginson Corpora I iori^New York

MEYER,

a.*

.

,

Cleveland

Centi al National Bank,

M.

P.

Co.,

National Securities

I EO

METZNER.

Milwaukee

&

y

.

;

Chicago

Co.,

BEVERLEY' B.
Davenport & Co., Richmond

Manufacturers Trust Company,

F.

&

•>

v

•'«'

L.

Wells

FREDERIC

Commercial

LLOYD, MORRIS
Drexel & Co., Philadelphia

Antonio

J.

A.

Turben St Co.,

Merrill,

Philadelphia

Stewart

■

-

MUNFORD, III,

Baltimore

J.

MELODY, THOMAS

The Philadelphia Bulletin,

PAUL

Mullaney,
MULLINS,

MEEK, COL. JOHN

Bankers

Hollywood

San

Corp.,

JOSEPH

CARROLL*

Miller St Co..

Mead,

e

B.

Stringfellow, Richmond

&

MULLANEY,

Distribution,

A.

LINEN,

:

York

D.*

Investment

Scott

Fund

Life

New York

,

New

EDWARD

EDWARD

Muir

Louis

Boston 1

Washington

IL*

Co.,

Co.. Cleveland

Massachusetts

Association,

Jr.,

&

Newhard, Cook &; Co., St. Louis

P.*

McLELLAN, PHILIP F>

MARY

Bankers

CLIFFORD

WILLIAM

Morton

MOWER,

MLIR,

1949

A.*

ROALD

List Publishing Company,

MORTON,

.

\

'* V.'V
"!*".'..

Volume

Number 5594

184

PAINE, Jr., HUGH

.

.

The Commercial and Financial Chronicle

.

PHILIP, PETER V. N.*

E.

W.

f Abbott/ Pr©ctoi^!& Pajne, New York
PAXCOAST;iJOflN W> j.Y ■: rf.. /.\Y>"/:■

f,

Dewar, Robertson & Pancoast,
Sao

Morton

Dean

•

Antonio

E.

CHARLES

*.

■

& Co.,

.Goldman,. Sachs & Co., Philadelphia^
RANNEY, BRUCE B>

„

Angqles

Los

Ball,

C.

'

•

PIETROWICZ,

STEPHEN

•

SIIEPARD, ROBERT O *

Shepard

Prescott,

Co.",

&

Philadelphia

RAUSCHER, Jr., JOHN H.

j;. Barth

Coffin & Burr, New

F.

•

CORNELIUS*

.Lord, Abbett & Co., Chicago
LAWRENCE r

H.

PINKERTON, CHARLES H.
Baker, Watts & Co., Baltimore

Morgan Sjtanleyv&-Co., New -York
PARKER. .NATHAN". K.':" /Y-/• Y

'

;

WILLIAM

'Y

De

'

U.

The First Bo.storl

-

-

Warren

I

■

Geo.

''

'

v

Cumberland

Nashville;--

"

Y

New York

Burns

Bros.

&

G".

New

York

Alex.

Jr., JACK F.*
Perkins & Co., Dallas

PUTNAM,

York

New

/,<

New York

& Co.,

York

New

&

Sons,

Co.,

Baltimore

C.*

New

De

&

Coppet

GERALD

P.*

Paine.

Writer & Christensen, Denver

New

PETERSON, E. NORMAN

New

Equitable Securities Corporation,
New

York

PEVEAR,

York

PEYSER,
.

.

BENJAMIN

Albuquerque

REUTER, F.

E.

RHODES, Jr.,

RAISS,

SPECIALIZING

,y

&

Co., St.

Continued On page 94

A.

Firm

IN

ARK

Bids

%

/

Firm

Distributors

H|

(

Offerings.

Mitt.

New York

A

Dealers

W.

Quotations
B O NDS

MUNICIPAL

San Diego
C.

v

United

G. PEARSON

States

Government

Securities

Market Municipals

General

•

Pittsburgh

CLAUDE

C.*

Co., Los Angeles,

'

CHANDLER*

Schapiro & Co., New York
HARRY

Anderson

&

A.

Strudwlck, Richmond

-

MALCOLM F.

Garrett-Bromfield

& Co.,

ARTHUR

Denver

R.

OF

Wertheim & Co., New York

Wood

T <;

SHHRLJH

Bank, Pittsburgh

Moulton &

H.

ROBBINS,

MEMPHIS

Paul
ROBINSON,

DELMONT K.*

Unrferwritiri

BRIAN*

York

Harold

•/,//>
v!'1.
'Boston

W.

Rhoades & Co.,

National

ROBERTS,

Lynch, Pierce, Fenner & Bean^,

QUIST, LEO L.
New York

FREDERICK

W.

■

York

New

Loeb,

ROBINSON,

F.

New-burger, Loeb & Co.,

PFEFFER,

New

M.

ROBERTS,

QUINN, JOSEPH C.*

living Trust Company, New York

-

;

RENO, JOHN W.*

M.

& Co.,

CHARLES

Co.,

RICHARDS,
& Curtis,

ARTHUR P.*

Merrill

&

McKelvy & Co.,

York

Quinn

f

WILLIAM W.»

Bache

R.

Webber, Jackson

QUINN,

SPENCE,

Hutzler',YPfe\v Yplrk

Townsehd, Dabney & Tysdn,

H

RENDIGS, Jr.,

REYNOLDS, Jr., STEPHEN
Blair & Co., New York

W.

QUIGG, JAMES F.
Peters,

•-

Y

/

Corporation,

& Share

REYNOLDS, IRVINE

QUAIL, JOHN J.
Quail & Co., Davenport

Bank,

Indianapolis Bond
Indianapolis

San Diego Union-Tribune,

Doremus,

&

/

[

•

".'Z'X

%

«V

& Mayer, Cincinnati',

Seasongood

Mellon

York

Hartford

Co.,

HENRY

Salompn Bros.

Corporation, New York

Co., New York

l>:.

•

•; Sun-Times, Chicago

Bakerv Slmonds & Co., Detroit

KEISSNER, FRANK L.

Carl

Rico

PETERS,

,

o. ;m..

''''

<*■

REIS, THOMAS J.*

.

Antonio

San

ALBERT
&

Putnam

W.*

& Co.,

'

PUTNAM, ALBERT D.

PERSHING, Jr., JOHN*
Government Development
Puerto

Brown

Walston

PERKINS,

Pershing

Walker

H.

smucker,

simonson, harry i y
: National Securities .& Research

P,

Commercial & Financial" Chronicle,
New York
,,
;

St. Louis

WILLIAM C.

PURKISS,

Washington

PERSHING, F.

.v'
Sons, Baltimore

&

'

'•Arthur Wiesenberger &

PRICE, W. JAMES*

Association,

Bankers,

Cvarrett

LEO

-

>

C<|., New ^Yoirk:'

.

.SMUTNY,. RUDOLF*

-'."'..V' c

-

RAYMOND

Co., New York

PRESSPRICH, Jr., REGINALD W.*

PENNOYER, MISS ANN
Investment

Robert
REIF,

PRATT, Jr., TRUXTON B.
Bankers Trust Company,

'

Denton,

-

S.IMONDS,;RALPR Wi*
.

Allentown

*■'

SMITH, J
Weeden

New York

..,,' i"

..

BjnaJl-Milburp ,Co.,"Wichita/

*

SIEFERT, RUSSEtL jE.*
Stern Bros. & Co., Kansas City

'

' A"

JOHN J.
"•
Straus, Blosser & McDowell, Chicago

reed, william l.
Co.,

Leedy, Wheeler & Alleman, Orlando

.

PEF.T, E.DWIN F.

,,

Bostpn

REED,

.

POWELSON, RALPH J.

Clark, Dodge & Co., New York
'

"

.

,

Vance, jSanders & Co., Boston '
SMITH, DUANE T.*

v

■

,

,

.

Morgan Stanley & Co.,
PECK, ANDREW F.

Chicago

Co.,

ELVIN K.

Dittmar & Co.,

Corporation,

V

.

Gibbons &

B.

PORTER,

Y''Y;"Y:iY

PAYNE, SAMUEL B.

&

&

JOHN*

Louis

New York

Tribune, New York

SMITH, DICKSON

.

S1IREVE, AyiCKLIFFE
Hayden, Stone &? Co.,

t

Edwards '& Sons, bt.

G.

KEDWOpD, Jr.,

Report, Washington

Poc'esta

York

A.

!-4.

GUY*

L.*

The -Keystone Company,

Co.,. New: York

Baker, Watts & Co., Baltimore

World

L M. Simon & Co.,

;

:'"■

Securities

"

REDMAN, W.

W.*

LAWRENCE

SHOLLEY, S.

.

JOSEPH R

New York Herald

k,

Camp & Co., Portland

St. Louis

J,

REILLY, F. VINCENT

Y

'

;■''■

Pierce, Fenner & Beane,

ROBERT A.*

W.

POPPER,

■■:• Y

Washington/";-

/

ANDREW

Thomson &

Nesbitt.
,

POOLE, MONROE V.*

"

HAROLD C.*
^
Securftie.s'& Exchahge Cbnimission,

.PA YNE, CARR

York

Co., New

POKORNY, JOHN M.*

Chemical Corir Exchange Bank,
New JYork-' * YY
v
. Y ' Y;

PATTERSON,

*'

News &

Cruttenden,

'ipAirtes6^iKiku>-Vi*,^
n

S.

PODESTA,

Y'/Y
Y
Corpqratibn.New York

Jr., EMIL J.* /

&

SHIELS,

Mercantile Trust Company,

C.*

CHARLES M.*

PLATT,

Coppet.&'Doremus/New York

PATTfeERG,

Pitfield

C.

Merrill Lynch,
New York

;

V-J*.;•''

PARRY/ SIDNEY

WARD

PIZZUTO, MICHAEL J.

•

|

A;

/•>The: Parker .Corporation,Boston
-

RAYMOND,

W.

^KayY Richards & Co„- Pittsburgh ./-V
PARKER,

RAY, THOMAS L.

BITFIELD,

"

i

Eberstadt & Co.,

SLEVIN,
'

'

PARKER,

-

York"

SI.ADE, JARVIS

Shields & Co., -New^ York

.

Co., New York

SKINNER, CHARLES L.*

Cleveland

Bacon, Whippla & Co., New York

SHIELDS,

.

Rauscher, Pierce & Co., Dallas

93

SIMONSON, WILLIAM J.
^

-

SHERBURNE, HAROLD H.

ALFRED*

Kidder, Peabody & Co.,

R.

Chicago Tribune, Chicago

,

C.

Janney, Dulles & Co., Philadelphia

t «

Burge & Kraus, Cleveland

KAUCII,

Rauscher, Pierce & Co., Oalls,s

^

Kay, Richards & Co., Pittsburgh

PARKER; JOHN G.

SHEAFFER, THEODORE

rankin, harley l.
New York

Co.,

&

RALPH

Witter

PIERCE,

PARKER, H. S.

'{

H.

PHILLIPS,

(2589)

EDWARD

H.

Schwabacher & Co., New

JOHN*

MEMPHIS 1,

York

TENNESSEE
i

'*

The First National*

Burnham

City Bank, New York

RAND,
v

^Denotes Mr. and

&

York

New

Co.,

RICHARD

Rand

Mrs.

&

ROCKEFELLER,

N.»

Co., New York

Government

ROEHL, ORA C.
The

John

WIRE

★

Asiel

Harold

W.

Stock

Midwest

V/.

Edward I.

Exchange

Kirkpatrick, Jr.

★

WIRE SYSTEMS

William Nation, M

—

Dick

Mo.
Goldman, Sachs & Co., New York

SAMUEL

h.

Federal Reserve

ROWE,

&

t-rn

Rowles,

Co.,

★

NASHVILLE

3,

TENN.

and

:

Arkansas

"

Municipals

York

New

Philadelphia

JAMES

United States Government

A.

Securities

New York

SCOTT

P.

JOSEPH

York

L.*

Ryons &

Lester,

h

*

;

■

Bank,

Alstyne, Noel & Co.,

RYONS,

Los

Co.,

SAGE, II, ANDREW
Lehman Brothers,

Angeles

Bond Department

G. C.

York

New

SANDERS, FLOYD W.
Weld

White.

&

Co.,

Union Planters National Bank

Chicago

SANFORD, Jr., JOHN B.*
White, Hattier & Sanford, New Orleans
SAPP,

ALLEN

Memphis 1, Tennessee

D.

Schmidt, Poole,

Roberts &

LONG

Parke,

Philadelphia

i

DISTANCE 218 & 502

SAVARD; J. ERNEST

ALpine 4-3313 and 5-9911

*

(Trading Dept.)

Savard

&

Seattle-First

U. S. Government Securities

FRANCIS

Jr.,

WESLEY

SCHLUTER,
New

••

Y

BELL TELETYPE—ME 99
WIRE

R.

n

—x

/ ;/;/ -

y*

//;; '/y/yyyy;

t::j ;y;yyyyyy!/:

G.

National

HAROLD

Eank,

Seattle

J.

National Bank

of

Chicago,

UNDERWRITERS

York

SCHMELZLE,

ALBERT

Fusz-Schmelzle

&

I

—

f

DISTRIBUTORS

—

L

MMM

M.*

Co., St.

Louis

SCHMIDT, WALTER A.*
Schmidt, Poole, Roberts & Parke,

and

•

Whipple & Co., Chicago

Bacon,

First

-

SYSTEM —THE BANK

Hart, Montreal

SCHANCK,

8CHELKE,

Dealers in

.<■

-

•

WIRE

TELETYPE NV 353

y

/

RUSSELL R.
Winston & Co., Houston

ROVVLES,

RUSSELL,

/lark, Landstreet
iKirkpatrick, Inc.

''' J

-

ROBERT G.*

Stroud

Van

■

Mississippi—Tennessee

Glore, Forgan & Co., New

AVE.,

FIRM BIDS AND OFFERINGS

"

v

Merle-Smith, New York

<fe

RUSSELL,

Scherck, Ricbter Co., St. Louis,

4TH

mmMmmmmmmmnmrnm,

m

New York

New Work

Co.,

ROUSE, ROBERT G.
B.

landifrttl, Ml

.★

'

Baltimore

ALFRED J.*

Clark

Utilities—Industrials

' '

*

BANK

O."

Legg & Co.,

&

ROSS,

Municipal Bonds
.

THE

—

i

v

Laird, Bissell & Meeds,

Insurance and Bank Stocks

Members

m

"

,

PHILIP

C.

ROSENBERG,

/

SYSTEM

ROSE, MIDDLETON*

WITH RETAIL OUTLETS

Public

4-

JAckson 5-8521

Keystone Company, Boston

ROGERS,

ACTIVE TRADING MARKETS

TELEPHONES

'

New Orleans

Rico

Puerto

ME-284

•

New York

GUILLERMO*
Development Bank,

RODRIQUEZ,

'rnmm

TELETYPES ME-283

JAMES E.

RODDY,

Scharff & Jones,

/ y

AVERY

Jr.,

Dominick & Dominick,

OUR TWENTY-SIXTH YEAR

Philadelphia
SCHOENEBERGER,

Municipal Bonds

Distributors Group,

SCIIWERENS,

♦

Scott

Department

A.

Chicago

SEBEL,

.

Southern & General Market

•

New York

Inc.,

MURRAY .r.

World-Telegram & Sun,
SCOTT,

Bond

CHARLES

Central Republic Company,

SCHREDER, HAROLD X.*

New York

Municipal Securities

BUFORD
& Stringfellow, Richmond

HARRY

Specializing in Florida Issues

L.

Stfected Investments Company, Chicago

A.T LANTIC

SEXER,
John

JOSEPH
C.

Legg & Co., Baltimore

severance, craig
F.

NITIONAI BANK
OF

frederick

Butcher &

CORPORATE ISSUES

ALL

York

LOCAL SECURITIES

T.*

Sherrerd, Philadelphia

JACKSONVILLE

SHANKS,

WILLIAM

The Bond

JACKSONVILLE, FLORIDA
Phone

UNLISTED
>

Eberstadt & Co., New

seving,

j

w #

ELgin 6-5611

Organized 190Z

Teletype JK 182




Barnett Nat. Bank

Mercantile- Trust Company,
SHAW.

II.

St. Louis

L. D. 47;

ELgin 3-8621

PIERCE,

C A K It I S 0 Ni.

V.
&

Co., Toronto

Corporation
shea. J.

Bidg.

Jacksonville 1, Florida

sharpfi, william p.

Gairdner

Member -Federal Deposit Insurance

S.

Buyer, New York

earl

Chicago American, Chicago

Bell

Teletype JK 181 -

WIJLIIEKM,

I IMC.

%

94

(2590)

The Commercial and Financial
Chronicle

Thursday, December 13,1956

*

...

\

Continued from page

IBA

WHITTLESEY,
First

PRESIDENTS

1945 -46

In Attendance at IBA Gonvention

Carl

Let

Higgir.son

WALBF.RT, RICHARD

Corporation,

ALFRED

J.

,

,

STAPLES,

JACK

R.

York

lilyth

.77

WALKER.

New

,

Kidder, Peabody & Co.,

.

„

.

New York

"

C* Allyn

Co.,

As

JA

"

'

■

,

'

'

Walker,

New

WTLI

'

t

7

"

.

WARDEN,

GEORGE*

The Econoini'st, Chicago
Drexe.1

7

_

New

S'h'.rnENsy

York

bONAi i^

Central

*

WAITER tiff

STEEL,

'•»•£

.

7."

!

;

Hayden,

VKN&TN.

G. "C.*

*

STEVENSON,

III.

Investment.

New

*

,

washerman; JO'HN
'

b-mktis

/..-^ociation,

Washington

John Clifford Folger

Charles S. Garland

.

LOS

ANGELES,

Holds

Club

Membership

The ninth

Calif.—Daniel

D.

Weston, representing the linn

25

of

Daniel

was

of

W

ILLARD,

been

admitted

to

&

Co.,

has

Dec.

the

STRAUS,

Co.,

membership

John

on

Swiss

it

Los
was

Angeles Stock Exchange,

club's

the

McNeil,

announced

President W.
Mr.

years

Exchange

G. Paul.

Weslon

investment

by

Senior Cashier

is

dent.

President

firm

he

of

founded

the

only

tals

Membership of the club to¬
with

46,

than

ago.

firm's

STROUD,

several

40

Trask for

more

SVICES.

Local

Listed

And
"If

And

Active

Is

Unlisted

In

is

We Specialize In

Market

a

we

find

;

.

*

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7

New

York

V.*

York

C.

Bear,
WELCH.

New

York

F.

F.

The

WERLY,
PuUiam

York

National

&

Fund

WERNER,

Bank,

WEST,
Ne

Co.,

San

FRANK

Francisco

York

II.*

Co.,

As

New

Securities

The

MRS.
Kelton

H.

Co.,

JEROME

St.

Louis

Chace,

York

York

Boston
8.

M*

Co..

New

FRANK

York
'

King As Dawson,

New

York

A.

Co.,

New

York

YOUNG,

Co., St.

KELTON

Fastnian

Louis

E.

White,

New

St.

Whiteside,

PAUL

Louis

Co.,
v

Union

Denver
.

Securities

York

YOUVGDAIIL,

Winslow,

As

II.

Dillon,

Estabrook

West As

E.

Sullivan

HAROLD

ZAHVER,

IIAIWtY

As

Co.,

VICTOR

Zahner

As

Co.,

New

York

H.

-

Kansas

City

Dempsey-Tegeler As Co., St. Louis
TERRELL,
Girnrd

Dealers

ALLEN

Trust

M.

Corn

Exchange

Bank.

Philadelphia
35

registered

representatives

give

you

pin point distribution

in

this

area

TERRY,

FREDERICK

Hamlin

EDWARD D. JONES & CO.
ESTABLISHED

1871

As

TIIAYER,

Lunt,

300

Yor'c

Stocl:

Board

North

CEntrai

Exchange

o/

New

TIIIERIOT,

4th

St.

American

StoCIc Exchange
Exchange <Associate)'

Stock

Jr.,

Saint

*

/

Louis 2,

Mo.

Private

Wire

Connections

with

Josephthal ife Co., New. Yorlr, and Francis I. du Pont
7.7.7:%'. •
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Crung <Cr Co..'jTcrnnto

"j:
<&

Theis

*]..

Co., Chicago

ASIC,''

Thomas

As

Co.,

M« Grtriniek

As

C.

E.

W.

Clark

Kaiser

I. M. Simon

&

MEMBERS
York

Midwest
American

CEntrai 1-3350
St.

Stock

Stock

;.

Oldest

;Ai

"t

F.

Stock Exchange

'

.

SL 288

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INVFSTMENT

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MUNICIPALS

Corporation,/•

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Co../ New

Missouri

t;

*;

Kansas

—

;

■%..

Co., Houston-

HENRY
Co..

L.

?

Richihohd.

t

CORPORATE
Jt

Industrial, Public Utility and
*

T0PEKA, KANSAS
Member

117 West 6th Street

TOPEKA, KANSAS
Teletype TK 8696

Stock

Exchange

VEAZ1E,

821

Columbia

Bank

Building

KANSAS CITY, MISSOURI

Mabon

YOYSEY,

WILDES
As

Co.,

New

York

WADS

WORTH,

Dillon,

Read

*

/
*

%




-

Member

E.

Co.,

916
.

.

★

IN CORPOR A.TED

Telephone Baltimore 1-4396

York

ROBERT

T..

Lecdy,-.Wl-teler As AEeinan, Orlando-

Midwest

Walnut Street,

-

L.

New

r

WAGNER.

★

LUCAS, EISEN & WAECKERLE

York

ARTHUR
As

.

Co., Savannah:

Kidder, Peabody & Co., Chicago

Teletype KC 81

.★

"

.

W.

New

FRANK

As

>7-

"

J.

1.

Chisholm

-

.

Pressprich As Co..

Varncdoe,

■

New York

'

II.

-

W.

BERNARD

HUGH

'

Railroad Securities

Bank and Insuranco Stocks

•

Jr.,

VAItNIVrOEr SAMUEL
Midwest

'

.<*
HENRY

Van ingcn As Co.;

W.

Texas

•

;*

,

York

INGEN,
,J.

Oklahoma

States

.

HtiUKELOM, ,'CAREL

/.ELM,

—

and Other -Midwestern

7

Television Shares Management Corp.,

R.

New-Msxico

York

R.

&

7

-.7

•

Nauman, McFawn As Co., Detroit

van

MO

7"

Co., Cleveland

•

V/VYDI R YOORT.

B£E€R0FT, COLE & CO.

BALTIMORE
C:TV

~

"'l7;

>

-

Neuhaus

Davenport &

New

1C1 5

ANSA'5

'-*"5

York;

F.

VALENTINE;

B.

Go.

6

BANKERS

v'

VAUGHAN, III
7
«=' - .
Securities
and
Fxchange Commission,Was'nington,' D. C.
'
'1

VAN

Slerri Broftcrs

EXCHANGE

.

\

New York

C.*

As

MlOWE8Tt|t«CK

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Hanseatitr

Underwood.

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EDWARD

UP HAM,

SECURITIES

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TURNER, ARTHUR
York

.

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UNDERWOOD, MILTON

MUNICIPAL and CORPORATION

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»

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THRBEN-, CLAUliE

It.

CORPORATE
SECURITIES.

.

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Pnker, Weeks As" ph.. New

I'HLEIt,

fv

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EUGENE*,r

AINOS.

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Philadelphia

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wmmmmmm. mm mmmmmmmmmm mt&mm m

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Merrill, TnrbeitsAs

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(Assoc.)

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tTnterberg. Towbin Co., New York

TOWNE,

DEALERS

••

WRITERS

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TOWBIN, BELMONT

BROKE RS
and

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7

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Co..

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Louis

•'

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MIDWEST

Louis

IIARRY

TOIiltEY,'GEORGE

mmmhi

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Kithn.'L(eb Aj Co..
TOM

7

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MRS.

Sons,

As

With-Hairy-TheK, St.

.

TIIORS,

.

THE

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Jacquclin, New York

.

Bell Teletype SL 593

,

York

CHARLES

IIARRY

Albert

TIIEIS,

t>

1-7600

Direct

THEIS,

Midwest

Trade

York

L.

Carlisle As
New

New

Brothers,

MEMBERS

Chicago

A.

ROBERT

Lehman

--

'

Robinson-Humphrey Company,

I'osworth.

E.

As

E.

New

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F.

As

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FREDERICK

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Coiporation,

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Jacobs A:

Chicago

Atlanta
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'

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As Co.;

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Walker

Goodbody As

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York

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MOOLLOMFS, J. PAUL*
WrlTf, Han en As Co.. San Francisco
YEARLEY, IV, ALEXANDER*

Chicago

B.

Webster

KELTON

H.

WHITE,

York

MEL

Boston

Co.,

'

:

York

W.

DAVII)

Wood,

S.
As

H.

WOOD,

WOOD,

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.

M.

Stone As

WONHAM.

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First

WHITE,

Atlanta

7./-

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v

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New

Co.,

&

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Hayden,

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CHARLES

As

'

WHITBECK, BKAINERI)

E.*

Bank,

GARRETT

Gundy

CHARLES

Witter

MOLL,
New

B.

First-National

Co.,

WILLIAM

WOLFF, JAMES

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GEORGE

As

j)EAN^ 7

Jr.,

Witter As Co.;

Dean

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Shearson,

National

Seaiple,

S.

WENDT,

/

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,

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Harriman

Sun-Times; Chicago

WKINTRAUB,
New

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WEHItWEIN, A. C.
.

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Witter

TAYIOR,

Invites Your Inquiries

there

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All

New

Ai

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: 7

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7

H. W ARREN
Tri-Continental Financial

Philadelphia National Bank,
Pltiladelphia

Minneapolis

Wood.

Department

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MARKETS

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TAYLOR,

LOUIS

;

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Washington

TAYLOR,

ST.

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As- Co.,

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-

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Washington
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have

who

"

York

McDowell, Chicago

DONALD

SULLIVAN.

elected Presi¬

was

been with Spencer

fjur

the

and

member,

50-year

A.

York^r * - -

Baltimore

M.

American security

7 7
■

York

York

New York

WTLI.ETT, JAMES

'

'•••»'<;•

WEHMANN...GILBERT

HENRY*

American

McDonnell

the

York

Lynchburg

Blo.-ser <fe

As

WRF.DEN; ALAN
Weeden

FREDERICK

Straus,

7.

held

DONAI.D

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PERCY

STK ADER,

Co.,

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As

Stubbs, Smith

8.*

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annual dinner of

Club

year

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Harold. S. Stewart As Co.,
Kuhn,

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WALKER

HAROLD

STEWART.

Daniel Weston Acquires 7
L. A. Exch.

Jr.,

Hemphill, Noyes <to Co.. New York
STEWART.

Asiei

watkins,

STEVENSON,

Co.,

FUH ARB1L.,

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s

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WtAJRREN,

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Bacon,.Stevenson As Co..

7

Bank,

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As

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-

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;

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As

ARTHUR

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MFSjIL*.- - j, ' U
Corporation, Bethlehem

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,

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Bros.

'to/.

A.

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WILDE,

York

^

GEORGE

STEARNS,

Loeb.

UR.

Stein

V

Bethlehem Steel

WANDERS,

York

New

B.

Chicago

GRAHAM*

WA LK ER,

STARRING, Jr., MASON B.7
A.

Co.,

As

MeMajms

',,'1'^
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.

Fulton, Reid '& Co., Cleveland

E. Hopkinson, Jr.

M.

WIESENBERGER.
Arthur

STALKER,

W.

'

WIDENMANX, HANS

1943 -44-45
STAFFORD, Jr., JOHN If.

7.„

ALBERT

Pennsylvania banking &. Trust

Bliilaclelphia

PAST

1946 -47

93

Stock

Exchange

>

Kansas City 6, Mo.
"

Bell Teletype KC 42

As

Co..

Volume 184

Number 5594

..

„.

The Commercial and Financial Chronicle

(2591)

~*skl

Continued from first page

then,

-

:.

sit

must

search their

down

and

minds

own

care¬

the test of time will not
cf

itself without

occur

weighed

against any belief
that Britain and France must

government

A.;/

fully. to determine whether sponsorship or artificial in¬
they are willing to
work centives,
certainly
without
harder
or
longer, produce pleas for such action in the
ever^ does not alter the basie our prayerful- attention,* ean more and
give up the result¬ name of foreign assistance. If
nature of the existing situa- .be quickly enumerated. One
ing increase in income to pay we feel we must for any rea¬
lion.
of the
most
important of for the things that they give son now advance large fur¬
There are. in any event,- these has to do rwith the
ques- away to their friends abroad. ther funds to Britain or
certain .key questions that we. tion of how much aid we
the answer to either of
can, If
France, let. us tell ourselves

As We See
.

this

about all'

no

what

matter

should

we

these questions is in the
nega¬

and some
of
them like to do in / the premises,
tive, then we had better not
plainly should be occupying/grant in the- circumstances go on with plans dor greatly
the
minds
of
Britons
and *now existing, without serious
enlarged international giving.

Frenchmen

One

too.

these

countries-

rescued

Manning Co. Formed
BEVERLY

of

the.

inflation

or

other disturbance

home.

at

Another

to do with what

not

The

has

authorities

ton would do

Washing¬

at

well,

8417

to

what

be

all

are

in

investment

business. Offi¬
Bennett, Presi- "
dent; Henry Manning, Vice-Presi¬

;

>

matters

Beverly Boulevard to engage

an

cers

matter

no

call them,"

we

be¬

so we

gifts,

HILLS, Calif.—Beh*

nett-Gladstone-Manning Company
has heen formed with offices at

likely in the event to turn

out

of

matter

a

(Special to The Financial Chronicle)

;

_

the facts of the matterare

as

foreign policy.

Bennett-Gladstone-

—

first and most obvious is this: .here

If.

be

broad

^

.

ask ourselves

must

It

98

are

Hyman

dent/and Delmar Gladstone, Sec¬

or

retary-Treasurer.

be

All

were

for¬

done, lieve, to face these questions
questions which must be merly with S. Logan & Co. **
keep out of avoidable trouble if anything,, to enlarge our squarely.
and are not able to take care capacity to
give substantial
-Let us .not deceive our¬
of
themselves
when
they aid without damage to our selves that the
problem can
blunder, how valuable as own economy. We are for all be
IBA PAST PRESIDENTS
painlessly solved by resort
allies are they fkely to be as practical purposes operating
to the
Monetary Fund or to
the years pass?
Another is at full capacity with all our any other device to avoid
1941 -42
1942
43
1939-40-41
this: If neither of them is able resources and manpower
higher taxes or greater bor¬
to stand on its own economic fully occupied. — that is,, as-,
rowing on the part of the
feet, but must be nursed and suming ;.hours~ and'.diligence Federal Government. We
may
coddled by the people of .this mow being devoted to produc/take it/for'granted that any
countryr/had we better y.not>tion i% all that we are willing money on which the British
be
looking ' for .;: some other to give. %
>.'*
/and French lay their hands
7*2;
road to safety? We
^hoUld * * Uwe^can. find ways / now will be largely placed in
Suppose that such questions as and means of becoming -more vour.v markets for'
things ! in
these, w o u l d be troubling productive.,' and unless at the short supply. abroad., This
Britishers and Frenchmen oC same time we are
willing, to .would mean that either we
can

can

;

-

.

,

•

-

foresight and .wisdom.: They give / up. U/Targer / portion ,of
certainly should be;
;/:'current income in taxes, there.

increase

.

Other Matters

' "

'j?
do

-

•

.

Other matters which should
be

occupying

aid

of the

a the
great deal that we can

way of economic
without trouble here at

in

production and
proportionally less
output ourselves — or
our

consume

find

ourselves

in

Newhard, Cook

&

whole

situation,

Co

British to

Unlisted

'Exchange

■'

(Associate) t'

SAINT

Natl

B*ax

Alton,

75)07

Bid*.

Forsyth

..Clayton,

niiutt,

Private

Wire

Blvd.

,.

Commercial

Belleville,

Missouri

I »

*

*

....

Co.,

in in

7.

,

of

■

our most
.

<

>

• "•

important services to

or,

number of
after the

made

loan to

II, among

Britain, in¬

•

and

It would

long

are

to

•

•

be

better

for

what

the\'

sather than to

•

■

New York

1,

MISSOLKI

Correspondent 14 Wall Street

Chicago TeLephitne to Bond Department Dial 211 Request Enterprise 84 *0
RESOURCES

OVER

*600

•

i

different

Private

of

kind




•

DEALERS

Corporate and Municipal
Securities

;

,

animal.

is

enterprise

investing

con-

foreign

or

REINHOLDT & GARDNER

money

ha§ been in the form of
purchase of private property
abroad or of establishing
businesses

in

countries.

Doubtless

will

Members

Sew

whether

investment

all
that

the

will

Locust

400

SL

stand

Midwest

Exchange
Exchange

Stock

120

1-2419

BEekman

Springfield, Mo.

•

Springfield, 111.
Direct

Broadway

NY

1-6640

Private

Wires

•

to

New

«-

3-5880

Joplin, Mo.

Fort Smith, Ark.
York Correspondents:

Pershin? & Co. and Good body A Co.

Trade

YORK 5

NEW

I

Street

Clayton, Mo.

Exchange

Chicago Board of

(Assoc.)

335-336

CEntral

■

foreign

Stock
Stock

ST. LOUS 2

continue.

process

York

American

One is often obliged to won¬
der

"it#

-

course.

abroad. Of recent years most

this

MILLION

DISTRIBUTORS

-

are

funds with reaexpect their return

branches

»

#

UNDERWRITERS

pre-

~of it
LOKIS

CHICAGO

•

True foreign investment is

•

7 stantly

SAINT

'

France,

tend to ourselves that We

a

■

7

run

with interest in due

MERCANTILE

LOUIS/

ST

? "investing"

STATE AND

BONDS

INCORPORATED

to various other

as

labeled

were

really

son

MUNICIPAL

Stifel, Nicolaus & Company

now

if gifts or
largesse or grants in aid or
other
forms
of
generosity

1

U. S. GOVERNMENT,

altogether,

A

Britain

to

the

in

institutions and to individuals

*

so

which is

countries.

•

\

were

well

as

•

•
t

BANKING

have

for long
serviced, should

paid

seem.

on

sums

'

"

i One

INVESTMENT

World

being
passed. And there is now talk
of
"lending"
further
large

»

;

would

them the

Illinois

New York

t niftir •

•

old

end of World War

Bid?.

Illinois

■

OF

al¬

decades,

which

they did not do

terest

Clark, Dodge &

to

Those

even

"loans"

Rose Bid?.

Harrisburg,

recent

debts,

been

years,

it

SL 151 & SL 152

(Municipal Dept.) SL 571
1st

had

we

have put us all on notice. But
.
.

Bell Teletypes (Trading Dept.)

I

never

OLIVE

LOUIS

in

"loans."

as

•

AND

SIXTY-SIX YEARS

interest pay¬

former borrow¬

years,

said

War

Exchange

FOURTH

recent

most

Mfdriest Stock

Municipal Bonds

on

gifts have been camouflaged

•Exchange

Securities

meet

in

American Stock

♦

par¬

is that in all too many cases

.

.

yyyyyyywyyy;yyyyyyyyyyyyyyyyyyyyyy;yyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyy//y//yyyyy^

ings, points another moral. It

Members

New'York Stock

Distributers

Emmett F. Connoly

>

ticularly the, inability of the
ments due

Underwriters and

John S. Fleek

are

Moral

Another

Listed <uui

dollars

attention,- home. The American people, chasing no greater supply of
goods and services.

our

Jay N. Whipple
#

This

\

situation

a

where many more

.i

.

96

The Commercial and Financial Chronicle

(2592)

Retire

as

New

Sidney

Inc.,

Foods,

Best

pany,

Morris, Pennington
Partners of

ican Exchange National Bank,

So¬

College,

Vassar

of

trustee

a

following that,

ciety of St. Johnland, and Sarah
Lawrence College.
He was Presi¬
Dec. dent of the Investment Bankers

Ray Morris, partner since 1921,
Harold D. Pennington, part¬

arid

31,■

since 1945, will retire on

has

it

announced

been

subjects

the

is

banking

A.

the Fi¬
American

He

was

made

the

H.

the

of

Chamber financial

Swedish

Scandinavia
long period of years and

ular business trips to

Co.,

Brown Brothers Harriman &

over

t38-year-old banking firm with
offices in New York, Boston, Chi¬
have

Both

in

Mr. Morris, who was born
Haven, Conn., in 1878,

•years.

iti

tries.

between

relationships

Scandinavian

and

America

the financial community for many

decorations

several

banking

prominent

been

by
of his work in developing

reason

and Philadelphia.

cago,

a

received

Inc.,

II.

in

partner

his

second from Walter

Parke, Philadelphia

rehabilitation

He is

of

Valspar

Co.,

Corp.,
Duval &

Line, Inc.

the

and

He is

2nd—William

the Order of
and the Fin¬
the White- Rose

Morris
of

rector

formerly

was

American

di¬

Co.,

Woolen

subsidiary

a

Oil

Standard

of

1st—T.

•

Co.,

—

Distributors

admitted

Carter &

We

Gilbert

Belle

Mr.

to

from the firm

Mr.

2nd—Low Net:

Mr. & Mrs. Macrae Sykes, Shields &

Company, New Yorl$

Mrs. E. Vans Morgan, Hanover Bank, New York

t

1st—Low Gross:

Mrs. Edward Hope, E. S. Hope & Co., San Diego

Jan. 1 will

on

2nd—Low Gross:

in

Mrs. Paul Frederick, Baxter & Company, New York
1st—Low Net:

Mrs. W. J.

will

,

Price, Alex. Brown & Sons, Baltimore

2nd—Low Net:
Mrs. Dana

Baxter, Hayden, Miller & Co., Cleveland

18-Hole Tournament—Low Net:

withdraw

Mrs. Miles Watkins, Stubbs, Smith & Lombardo,
Birmingham

Dec. 31.

TENNIS

Wallace

Admit Partners

TOURNAMENT

BALTIMORE, Md.—William L.

Oil

and

Reed

Standard Fruit & Steamship Co.

Jan.

Truman

will

1

Robert Garrett

Sterling Sugars

Redwood

Semans

Richmond, Va., won 7-5, 6-3 from Richard A. Buck, Put¬

on

nam

in
& Sons, South and

Common)

and

T.

become

partners

Fund

Distributors,

New

York,

A.

and

Paine, Webber, Jackson & Curtis, Boston
Mixed Doubles:

Streets, members of the

Mr.

New York and

Philadelphia-Balti¬
Stock Exchanges.

more

Latour, Merrill Lynch, Pierce, Fenner & Beane,
Henry Lee Valentine II. Davenport & Co.,

New York, and

Common)

Southdown Sugars, Inc.
(Preferred

McElroy, Morgan Stanley & Co.,

Men's Doubles:

and

South Shore

& Mrs. David

Robt. Garrett to

Trust

New Orleans Public Service Inc.

Stocks

Mericka & Co.,

Kickers Handicap:

partnership

Greef

Mississippi Shipping Co.
(Preferred

Carl Doerge, William J.

New York

(Assets)

New Orleans Bank

& Mrs.

2nd—Low Gross:

Stock

Corp.

Bank Oil

Frederick, Baxter & Company, New York and tHattier, White, Hattier & Sanford, New Orleans—78

Cleveland

Exchange.
Mr. Mc¬
Ardle in the past was with Vilas
& Hickey.

especially invite
inquiries in:

Isle

Canal

*

.

1st—Low Net:

your

Mississippi Municipals

;

Mrs. Paul

Co., 14 Wall Street, New
members of the New

Herbert

Louisiana and

"*

1st—Low Gross:

City,

York

Dealers

—

*

18-Hole Tournament:

York

Underwriters

&

Everts,
'

-

|
Mrs.

INew York,
Jr..

P.

Richard

won

Buck,

Putnam

Fund

Distributors,

6-1, 6-2 from Mr. & Mrs. Eugene Black,

Lazard Freres &

Co., New York;

-V

•.

SCHWEICKHARDT & COMPANY
MEMBERS

NEW ORLEANS

809 HIBERNIA

-TK"

Briggs, Schaedle Co.

STOCK EXCHANGE

Jack Mingo Opens
,

BUILDING

NEW ORLEANS

>

Teletype NO 344

'*

(Special to The Financial Chronicle)

j

.

.Tulane 6461

SACRAMENTO, Calif. — Jack
Briggs, Schaedle & Co., Inc., 44 Mingo is engaging in a securities
business
from
offices
at
1313
Wall
Street,
New
York
City,
dealers in United States Govern¬ Twenty-first Street.

.

■

f

Joins Bache Staff

(Special to *he Financial Chronicle)

Promotes Four

12, LA.
<&

r

«

.

<

^

••

<

"■

Tulane 3812

_

.

'

Securities and Bankers

ment

f

ceptances, announce the following:

JAMES E. RODDY

.

.
BEVERLY HILLS, Calif.—Donaid, G. Felton has > become connected'.with
Bache & Co., 445
North Roxbury Drive.
•

Ac¬
■

IKE D. SCHARFF

>

~

-ik.

•

'.-L

f ■.1.

v't

t

promotions:
Robert
H.
Britton,,
Vice-President; John M. Jones,-

JOHN J. ZOLLINGER, JR.

Treasurer; Miss Eleanor M. Metzger,> Secretary,
and
Russell
J...
McDermott,
Active

Assistant

Treasurer.

UNDERWRITERS

Trading Markets

•

DISTRIBUTORS : •

DEALERS

Joins Sheffield Staff

tn

(Special to The Financial Chronicle)

NEW

LOUISIANA AND MISSISSIPPI

erick
V

BANK STOCKS AND

LONDON, Conn. —Fred¬

A.

Stein

is

now

Boris Martynow

Specializing in Louisiana

associated

with Sheffield & Co., 325 State

LOCAL CORPORATE ISSUES

St,

Mississippi

Opens

(Special to The Financial Chronicle)

Municipal Bonds

~

SAN FRANCISCO,

Calif.—Boris

P. Martynow

is conducting a secu¬
rities business from offices at 1010
Franklin Street.

Scharff L Jones

He

was

formerly

with Hannaford & Talbot.

INCORPORATED

219

TELETYPE
NO

180

&

181

(Ground
;

L.

Floor)

D.

Tulane

0161

JACKSON, MISS.

ROUGE, LA.

—

r - -




LAFAYETTfc, LA.

WEST MONROE, LA.

,

HATTIER & SANFORD

235

NEW ORLEANS 12, LA.

SHREVEPORT, LA.
BATON

M. J. Cambia Assoc.

CARONDELET ST.

•

Chiles, Chiles-Schutz Co., Omaha

Mixed Foursome Tournament—18 Holes:

A. J. McArdle to Be

George J. Bourg

Vincent B. D'Antoni

York—76-6-70
II, Dominick & Dominick, New York— ; -

18-Hole Kicker Handicap:

of

be

E. N. Anagnosti

Cafone, W. E. Hutton & Co., New

77-6-71

Partner in Carter Co.
.

C.

2nd—J. E. Osborne

West

Wheatley Hills Golf Club.

Alfred J. McArdle
&rwin R. Schweickhardt

Barrow, Barrow, Leary & Co., Shreveport—»

98-23-75

Admit Three Partners

ing with the West India Oil Co.,

Bank of New York & Trust Com¬

Writer & Christensen, Denver—

18-Hole Handicap Low Net:

Asiel & Co. to

Jamestown, New York, before go¬

a

•

Trofrhy—18 Holes: Low Net:

Com¬

joined the editorial staff of the nish Order of
"Railway Gazette," now "Railway (Second Class).
Mr. Pennington, born in Hollis,
Age," in 1901, and was managing
Asiel & Co., 11 Wall Street, New
•editor of that publication
from New
York,
in
1890,
attended York City, on Jan. 1 will admit
4903 through 1910. He went with Jamaica
High School and New E. Nelson Asiel and Louis Sidorthe firm of White, Weld & Co. in York
University,
entering • the sky, member of the New York
1911 as a partner and joined the
banking business with the Na¬ Stock Exchange, to general part¬
*Srm of Brown Brothers & Co., tional City Bank in 1911. He was
nership, and Robert R. Asiel to
*tow Brown Brothers Harriman &
later for a time Office Manager of limited
partnership.
Art Metal Construction Company,
Co., as a partner in 1921.
Mr.

R.

Warren

St. Olav of Norway,

j.

(«%-# draw with Andrew Peck,Clark, Dodge & Co., Ne\V ^ork) /■/•*', .
n, v V

1st—Gerald P. Peters, Peters,
91-17-74
-

member

a

.

York—82-10-72

Robert E. Christie Memorial

the

Valentine

Wessel,
of

#•'

in
the

John G. Paton & Co., Inc.,

merce,

Coast

New

following World War
Chamber

,

\

1st—A. H. Aldinger, Fordon, Aldinger & Co., Detroit—77-6-71
N. Mitchell, Caldwell>;|tfarshall, Trimble & Mitchell,

former director of the

a

>

.-•>.

2nd—J.

with

of

won

Schmidt, Schmidt, Poole, Roberts &
>'k
f

18-HoIe Handicap Low Net:

1945.

in

Holes Low Gross:

Hughes, Lord, Abbett & Co., New York—73
2nd—Stanley McKie, Weil, Roth & Irving Co., Cincinnati,

Government

work

;

1st—A. R.

Co.

Orange-Nassau

,

Jr., Lord, Abbett & Co., New York—•

Senior Championship—18

a

W.

&

November 25-30

76-6-70

Danish

the

include

These

coun¬

Harriman

—

M. Ergood, Stroud & Company, Incorporated,
Philadelphia—73-3-70

were

Pennington,

of

Netherlands

Order of Dannebrog,

New

Co.,

a

of

Netherlands

of America. Mr. Morris made reg¬

Pennington

D.

made

Hollywood, Fla.

Trophy—18 Holes Low Net:

2nd—Andrew J. Lord

Harriman

was

Dutch

Mr.

.

of Commerce of the United States
Morris

&

1952,

In

American decorated
Order
Chamber of .Commerce, Inc., and the
a
founder member of the senior recognition
council

and

Brothers

Norwegian

the

of

of

H. Little

—

1st—Russell

Department

Brothers & Co. and

Harriman

Brown

Scandinavian Foundation, a direc¬
tor

Vice-Presi¬

a

firm

Co.

&

Harriman

of

member

and

Committee of the

nance

Alden

Wayne

and

trustee

and

Symington-Gould merged with Brown Brothers &
Co. in 1931, he became Manager of
Pump Co., a

of

director

a

was

Foreign

Thursday, December 13,1956

AT THE IBA CONVENTION
1956 Convention

partner in that firm in 1930. When

Monthly," "Yale Review,"
"World's Work," and other publi¬
cations.
At the present time, he
lantic

Corp.

the

Brothers

"At¬

the

to

in

..

RESULTS OF GOLF TOURNAMENTS

of the Irving Trust Company.
In 1928, Mr. Pennington joined

occasional contributor

an

various

on

dent

Morris

Mr.

1926.

in

Association

by

has been

Ray

Assistant General

as

Pub¬ Manager in Valparaiso, Chile, and
Uruguay.
He
later
lic
Service Co.,
Grace National Montevideo,
became
Assistant
Secretary and
Bank, Grand Union Co., Munson
Steamship Lines,
Punta Alegre then a Vice-President in the For4
Sugar Corp., SKF Industries, and eign Department of the old Amer¬

Blumenthal & Co., Engineers

IBrown Bros. Harriman

ner

Jersey,

.

(Special to The Financial Chronicle)

;

LOS ANGELES. Calif .—Mike J.

New Orleans

Cambianica is conducting a secu¬

rities business from offices at 3337
West
the

Olympic

name

Associates.

of

Boulevard

Mike

J.
~

under

Cambia

&
:

■■■:.

.

Volume

184

Number

5594

.

.

.

The Commercial and Financial Chronicle

(2593)

97

erations, and not only freight that
got the increase, and effective for
the full 10 months in

Railroad Securities

sulted

By GERALD D. McKEEVER

extra

=

has the

Railway

declared by the Northern Pacific,
and this is in addition to having

the

increased

the

regular

payment in

amounts

is

to

that

the

$4.25

will

*

amount

share

per

against

as

the

the official

about

it

because

of

is

in

finding

the

earnings.
third

a

1955 month.

to

as

we

apply the

final

the

to

crease

two

would

income

net

this

and,

figure

added

million turned

in

to

at

the

for

The

it

first

$21.8

side,

is

probably

however,

since

wage

ing

the

ops"

whose

made

the

as

settlement

retroactive- to

has

share

would

to;
the

on

shares

all of
■

of
one

Oil

about

been

in

1—the

road's

into

the

since

count

which
road's

1952

has

(but

million

road's
dend

for

estimated
net.

and

The

to show

other

much

the

increase

in

not expected

its

district
to

as

and

the

uptrend, it is

a

added

difficulty, in

com¬

and,

as

a

roads

in

the

matter. of

generally,

South

in

fact,

and

having

the

had

$6 million to the road's wage bill.
On
*

the

as

6%

done

was

Northern

if

there

certain

on

possible net
gain of something of the order of
$2 million annually or 39 cents
per share after allowing for the
full 52% Federal income tax. The
Northern
crued

Pacific,

Federal

of

While
the

of

this

the

Northern

problems

Pacific

stem

partly from its light

density, this
road
has
the
compensating ad¬
vantage of a light capitalization
per mile. Also, considerable relief
should be gained from completion
dieselization

for in the

which
of

course

is

Northern

Pacific has

miles

from

been

freight

per

1946

to

handi¬

Allan M. Pope

Bovenizer

Henry T. Ferriss

the

train

end

With Calif. Investors

Two With

(Special to The Financial Chronicle)

LOS

BEVERLY HILLS, Calif.

ANGELES, Calif.—Edward

and

Brightman, Allen Silver and Moe

Baker

Solzman

become

have

been

added

to

Lloyd Arnold

(Special to The Financial Chronicle)

the

Leo

L.

connected

staff of California Investors, 3932

Arnold

Wilshire Boulevard,

—

Wacker
with

Lloyd

Camden Drive.

&

Company,

404

North

hour

of

last

A better showing is in store
from steps already taken.
Orders
w?ere
placed last April
for
80
additional

diesels

the

and

Morris W. Newman

Wm. Perry Brown

John E. Kerrigan

1956

program also called for additional

CTC

installation—in

this

case

123 miles of road between
and

on

Helena

LOUISIANA, MISSISSIPPI, ALABAMA, GEORGIA,

Livingston, Mont.

those

who are intrigued by the
potential. The indicated yield

of

there

were

that

revenues

are

period

in

As

result, the wage increases
fringe benefits provided in
a

and

the

1955

costs

settlement

and
higher
affecting all op¬

otherwise

but

DEALERS

the
of

than

TENNESSEE, SOUTH CAROLINA, NORTH CAROLINA
and OTHER SOUTHERN MUNICIPALS

if

oil

oil

We

income

that

is

obtained

now

"Nipper."

MARKETS

Louisiana

Hibernia

Bank

*\

Building

*

12, LA.

Oil

Edson Cooke Joins

Smith, Moor« & Co.

Electric

Ray

Teletypes NO 189 & NO 190

Long Distance 345 & 389

Company

ST.
&

LOUIS,

Mo.—Smith,/.Moore

Co., 509 Olive Street, members

McDermott

Nat'l Bank of Commerce
San Jacinto

Southshore

of the New York

Petroleum
now

Sugars,
Oil

and

Stock Exchange,

announced that Edson B.

Inc.
a

associated with

Cooke, is

their firm

Registered Representative.

as

Specialists in

"

Development
A

Mr.

graduate of Williams College,
Cooke

career

NEW ORLEANS BANK

in

STOCKS

his

started

the

The

After
imwiTO

the
War

Howard, Weil, Labouisse, FriedrichsU

of,

II,

and

&

the

Pacific

he

joined

Army,

during

the

"Mademoiselle"

Smith

publication.

a

sales

staff

Street

Since

in

World

&

western

Mr.

Cooke

Advertising

"Mademoiselle."

was

Barrow, Leary & Co.
515 Market Street (P. 0. Box 47)

1949,

prior to joining Smith, Moore

Co.,

Dealers in

Municipal and Corporation Securities

duty with

South

MUNICIPALS

Sales

"Chicago

Tribune."

:

LOUISIANA

business

Advertising
of

Department

ORLEANS

321

7

Trust

Southdown

ST.

'■

Investment Bankers "

NEW ORLEANS

Assets, Inc.

Central

Mississippi Shipping Co.

AND COMPANY

-

think

not

can

INC.

with the same
which affords

prospect

potential

apparent

newman, brown & CO.

of

presence

difference.
an

top quality

the

not

element,
growing oil
the "package" makes all

the

value in

Gfasscock Tidelands

CORPORATE SECURITIES

less

South¬

Manager

of

SHREVEPORT 80,
Telephone 3-2573

LOUISIANA
Bell

Teletype SH 82 A 83

EJi

have

year.

stock

the

question.

CARONDELET

W.

called

capped by its tardiness in this regard. At the close of last year the

ton

G.

the next two

according to present plans.
There is little question that the

years

10-month

MUNICIPALS




year.

operating

freight, and for only

road's

of

Hibernia Nat'l Bank

NEW

ac¬

only at the
for the first 10

80%

the

of

J.

TELETYPES

however,

taxes

rate of about 23%
months

a

derived from

DISTRIBUTORS

NO 364 (Corporate)
NO 38 (Municipal)

"hold-

commodities.

This would indicate

something less than 5% at the
price, and giving effect to
the extra dividend, would not be
outstandingly attractive for a rail

1

222

1931-32

taxes

current

Fifteen

2711

1934

gain

before

of

applied to only the 90%

Canal

TU

would

important

no

are

downs"

M Jean C. Witter

application,
March,
the

last

Pacific

roughly $10 million

a

freight

Canal

TELEPHONE

hand, if the ICC
6% freight rate'in¬

a

against the 7%

crease

on

LOUISIANA

other

grants evefi

increase

FIRM

—

in¬

12V2: cents

hour including fringe benefits,
or about
6%, for the first year of
the 3-year contract, will add about

per

the

UNDERWRITERS

which

of

oil

the

Orrin G. Wood

increases

wage

pending

increase

Meanwhile,
Northern
Pacific
stock is particularly attractive to

reflected

Edward B. Hall

along
application

7%

of

and
an

rate increase of last March 7. This

change, while rail¬

net operating income, actually

for

both the

1935-36

increase

to a large extent.
road still owned 426 steam locomo6,900 mile Northern
tives as against 391
diesel units.
distinctly in the growth
This goes far in
explaining the
to
revenues, surpassing
mediocre gain of only 35% in gross

with the Northwestern Dis¬

non-

are

out

will be the

1936 -37

granted

barely

the

of

balance
as

year

total

the

West

divi¬

sources

do

is

the

less than average increase in rev¬
enues.
The 4.3% gain in gross for
the first 10 months of this
year

ac¬

$2.2

Northern
should

with

credited

of

the

time

trict

been;

Burlington

operating income
way

all

of

in

of

round

volves

of

potentially a
bolstering

the

pany

be

Department
.surplus prior thereto) will, prob¬
account

for

the past several years

had

directly to the Land

ably

are

relatively high cost operation be¬
cause of light
density. This year,
however, the Northern Pacific has

per

income

as

average

';

*

Basin

1938-39

ratio

the

Class I

4,962,494
which is

capital. stock,
class.

income,

taken

still

$4.28

this

class

figure from $21.8 mil¬
million for the year,

latter

the

Williston

and

While

lion to $21.3
but

The

longer

no

properties,

gas

the
major
Among those operat¬

income

Pacific is

final two months of this year. This
would reduce the above projected

equivalent

fee

including

factor

the

case

wage
bill
looks like
$500,000 after taxes for the

net income

Pacific
and

more
than
merely
lagging rail income

additional
about

road

in

Indiana.

Pacific,

"non-

Nov.

of

of

1—that is, that the
brotherhoods Iwill get

treatment

The

farms them out to oil

the

strong

Nov

same

million

acreage

Oil income is thus

board
wage
increase
for
both
classes of employees will be retro¬

operating

in

ard

retroactive only to Nov.
1, did not stand in the way of
the smart October gain.
Assum¬
ing that the entire across-thecreases,

active to

it¬

road

3.2

Shell, Texas Company and Stand¬

high
in¬

the

on

oil

companies.

million.

'

This

its

operators

to place

about

at

net

this

Northern

but instead

10

seem

1956

the

the

Montana.

owns

works

$4.4

months, this would

in

are

rights
rights. The esti¬
receipts are al¬
most double the $1,687,153
from
this source in 1955, and the 1957
estimate is placed at $4.2 million.

$17.4

the

what

Pacific

has retained oil and gas

or

the

year,

where-the oil

mated oil and gas

the

for

this

of

of

in

reserve

and other mineral

bold

so

Basin

have

and

either

rate of inl-

same

months

place

million

of

be

may

oil

PRESIDENTS

pending before the ICC.

granted

of

are largely "checkeralong 110 miles of the
right of way in North Da¬

kota

some

earnings

those

over

If

the

Pacific

wage

another

rates

lines

now

less

1955,

which

road's

subsequent

Net

for

boarded"

Tor the month of October were up

about

of

or

may

acres

btit

ago,

fig¬

against

as

of the Northern

located,
self

estimate of the

months

two

confirmation
trend

extent

lands

only that it is the mean pf
the $4-$4.50 range that was given

also

million

the Williston

not

road

year

$1.7

the

$3.85

The
$4.25 per share estimate
for this year appears quite sound,

as

current

than

in 1955.

out

1955

which about $1.2 million was net.
There is no reliable estimate of

about

to

the

allowing for the pick-up
operating results. Receipts

in rail

being passed on' to the stock¬
holders.
It is estimated that this
net

than

year

PAST

been

and wage increases

unless

freight

the

from oil and gas are
officially es¬
timated at $3
million gross for

greater

part of this year's estimated $2.2
million increase in net earnings is

year's

full

has

Northern

IBA

net

particularly burdensome,

problem
in

ure, even

What this

1955.

for

corresponding 1955 period, is
placed at about $500,000 less for

rate from
$1.50 to $1.80 coincident with the
final

than

year

that

re¬

of

and the present round of
wage in¬
creases
will
likewise
present a

about $1 million lower for the first
10 months of this

the

The

relatively high

thus

are

year-end dividend of
10 cents per share has just been

question,

erosion

income

mentioned.

of about 52%

Northern Pacific
An

the

operating

IP
5

in

The Commercial and Financial Chronicle

.

.

Thursday, December 13, 1956

.

(2594)

98

Bankers Offer
PRESIDENTS

PAST

IBA

1925

1926 -27

1929 -30

Gily
Of Monlreal 4%'%

-

And

26
An

Public

41/2% Debs.

By OWEN ELY

syndicate

underwriting

Southwestern Public Service Gompany

Shields & Com¬
Stuart & Co. Inc.;

headed jointly by

Halsey,

pany;

Southwestern

Savard & Hart and Salomon Bros.
& Hutzler on Dec. 12 offered

481,000 of City of Montreal

U.

1956

ada)

Utility Securities

S.

currency

SGi vcj

$22,-

(Can¬ in
issue,-

New

nui uicni

1940-50, with the rate of increase'

small contiguous areas

since; World
that

the

connected

except-for

a

75'% in the decade

population by

Mexico, Oklanoma' and
whole being inter¬

Kansas,

4XA% and 4y2% local improvement

ih

area

a

Texas and

Service

Public

War

II

exceeding,

experienced in the

company's

The

war.

growth has

own

been

remarkable, as shown by the fol¬
Jan. 1, 1958 to small
section
in> New
Mexicoi " lowing comparisons - of increases
The- debentures • The
territory is hignly diversi¬ in the past--decade:
v
7
are
scaled to yield; from 4%
to1
fied,-the, greatest- industrial ac-^ V
"'*'*•
Electric
." .Z
5.50%, according to maturity, plus
tivities
beihg
centered - around 1
*"■>, "■ F'a':'Z"S
Industry
■.
accrued interest.
y
:
r; ; *,,;
b* v.-,-'..*"/•••
Juiciease Company
Borger, < northerns/Texas, ■*where
Net proceeds from the financing
V
\
'55 over '54
lncr..
the
important
oil
reiinery
of
will be applied
by the City of •
KWH sales
1
112% ~3r8%
Phillips Petroleum
(the
largest
Montreal toward the payment of,
127
282
customer) is located.
There are Revenues
due

debentures,

one

very

inclusive.

1976,

.

.

.,

v

•

..

_____

____

Bay Morris

'Pliny Jewell

Trowbridge Callaway

reimbursement

or

a

to open,

John Maher, V.-P.
of Amos Treat Co.
Vice-President

and

director

of

Amos Treat &

Co., Inc., at 79 Wall
Street, New Ybrk City, in charge
of
trading.
Until
recently
Mr.
Maher headed Stamrowe Trading

Co.,

Inc.

advisor

ficial

to

Prior thereto he was
the Employers' Bene¬
of

Funds

than

more

His

back

Previous

changes,

&

Co.

Co.,

and

He

is

a

International

director

Smith

B.

Robert

Co., 509

Stock

as

whole

a

date

to 102%, plus accrued interest.
Principal of and interest on the
of

Ex¬

New

in

lawful

unconditional

and

ion of

will withdraw

in

the

firm Dec. 31.

two

be

direct

the

In the onin-

all

ently imposed by Canada arn not
tures

who

owners

thereon

residents

not

are

of

ince

UNDERWRITERS

•

DEALERS

•

corporate

•

DISTRIBUTORS

•

municipal

&

is

of

Quebec, has the. largest
population of any city in Canada
and occupies a leading position in
the commercial, industrial and fi¬
nancial life of Canada. According
to

securities

the Prov¬

in

the

Canadian

1956

estimated

census,

wheat

them itself.

with

serves

95%

While there has been
condition
in

and

in

where there
Growth

northern

been

rapid.
show

ures

ties

served

Soutn

many new

the

aoout

15% of the
has

are

60%
area

the

of

Tne

37,000

irrigation
-

the

and

has

other purposes

plants for

erating
mated

exceed

to

wilh
elec¬

company.

adequate

an

condensing
at all its gen¬
a period
esti¬

for

water

of

wells

territory

pumpedwitn

company

.

supply

the

life

of

these

cities in
the company's territory have re¬
cently acquired water rights cov¬
ering underground water supplies
The two largest

plants.

fielus.

their

normal,

of

is irrigated

in

6,000

some ?

has

fig¬

communi¬

25

increased

rainfall

consistently
produced
At present tnere

about

operating

Plains

census

served

with

abundant crops.

area,

territory

The 1950
that

territory

company,

some

drilling activity
Oil pumping

the

are

the

of

drought

a

past five years

tricity furnished by the

the

in

the

and

production in the
Hugoton fields is

greatest' in

the

averaging

the deeper sands.
■

over

much

by

Potash.
gas

1956

sub¬

year

a particularly good
showing in water heaters, ranges
and dryers.

potash mines

producing

previous

stantially with

are

hign

a

Dealers' sales in

the

topped

under irri¬

now

228

pliances, although it does not sell

and

with 70,000 acres
The Pecos Valley

with considerable
in

located

S.
and

important

Canada.

Montreal,

U.

Panhandle

by'

interest

.

where cotton,

agricultural,

Carlsbad

Oil

respect of the deben¬

the

or

ago.

company

near

counsel, income taxes pres¬

payable in

..

degree of irrigatiQn.' In this area

of

obligations

acres

compares

years

also

is

will

debentures

the

159

earns.

The
company
is
aggressively
promoting the sale of eiectric ap¬

oil

.;

South.of Amarillo

217,000

gation

the United States.
The

with

-

of

money

in

located

"South Plains,"

the

payable in the City

are

York

allied

production.

stk.

plant-_______ 134-338

many

alfalfa, sorghum and truck crops
are
raised on a large scale with
the aid of irrigation.» This is the
principal source of the company's
irrigation
water
pumping
load;

option of the City, on any interest

debentures

supply, and

Common

Gross

Amarillo, the largest city served,
a
wholesaling and distributing

the

in part, at the

or

carbon black plants
producing about 45%

industries

gas

cattle belt.
The debentures will be redeem¬

able

the City of Montreal.

partnership

limited

from

Corp.,

Investing

&

Dec. 31.

Allied

of

ments and sidewalks.

members of the New
Midwest

on

E. F. Hutton &

Co., Glore, Forgan
R. W. Pressprich &

Moore

Smith,

and

York

included

limited part¬

a

of

nation's

center

par

W.

Mo.—Norman

Halls will become

Olive Street,

quarter-century.

a

associations

is

prior to maturity,
at redemption prices ranging from

LOUIS,

in

and

improve¬

local

permanent

payment

Smith, Moore Admits
ST.

Wall

extends

economics and

on

investments.

Springfield

newspapers.

experience

articles

lished

ner

(Mass.)
Street

the

other

the

other

ments, consisting of sewers, pave¬

long been a member of New York
Society, of Security Analysts and
has
written a number of pub¬

John K. Maher, has been elected

of

extend and widen certain

he has

STANY,

to

addition

In

number

in this area,

streets, and toward payment or re¬
imbursement of the eo^t of certain

Buckeye Corp.

and

various con¬
property in order

of

Inc.

Products,

Steel

General

its

Fund for, the cost of
demnations

Automatic

of

Sufficient-for

total

and

least

at

smaller cities

and

75

years,

communi,-

the

of Montreal
communities
as
was 1.5%,327
compared to 1,395,400 for 1951. It
population

its

and

neighboring
of June 1, 1956

"

.

is

situated

navigation
the

onen

head

W.

TEXAS

ocean;-

Wallace

of
of

Payne,

and

sea,

of

1.000 miles from

about

inland

the

the

at

the foot

at

navigation

system

M UNI DIP A L

President

the Great Lakes and St. Lawrence

BONOS

River: and the bulk of rail traffic
between

points

east

and wnst

Montreal

must

pass

through

Leading industries in Mon*
include
women's
clothing,-

city.
treal

slaughtering

Muir Investment Corp.
101

SAN
Direct

Wires

to

New

St.

N.

men's

meat

and

packing,

-

clothing, tobacco, cigars and*

cigarettes, miscellaneous electrical

Mary's St.

ANTONIO
York

of
the

5, TEXAS

City, Dallas, Houston,

GUNTER

and
supplies, leather
foo+wear, printing and publishing,
apnaratus

railway rolling
Albuquerque,

Waco,

stock,

and

SAN

brew¬

CApitol 7-9253

5, TEXAS

Teletype SA 13

eries.
Representatives

'

''Denver, New Orleans and Salt Lake

BUILDING

ANTONIO

'

City
AUSTIN—DALLAS—YOAKUM

Geo. 0. B. Bonbriphl
To Admit to Firm
ROCHESTER, N. Y.—Philip H.

Underwriters

Distributors

—

—

Gerner,

Dealers

will

Jr.

admitted

be

to

partnership in George D. B. Bonbright & Co., Powers Building,
CORPORATION

AND

MUNICIPAL

SECURITIES

members

of

Exchange,
TRADING

LEADING

MARKETS

SOUTHWESTERN

the

New

York

Stock
in

Jan. 1.

on

Underwriters, Distributors and Dealers

IN

Municipal and Corporate Securities

Jsnnev, Billies and

SECURITIES

Battles to

Merge

Pa.—Janney,
Co., Inc., members of the

PHILADELPHIA,

Russ

Company

&

Dulles &
New

INCORPORATED

York

Stock Exchange

American

Midwest

Stock

Stock Exchange

< Associate)

Dulles

effective

Dec.

located

Exchange

Exchange,

and

Company, Inc. will form

Jannev,

Members
New

Stock

York

Battles &

at

1401

Battles,

&

31.

Inc.

Offices will

Walnut

be

Dittmar & Company, inc.
Over 30

Years Experience in

the Texas Market

Street.

'

J

'

.

Alamo National

SAN

ANTONIO

Building
5,

.

"

'

1

k<

TEXAS

Winthrop
come

H.

Battles

will

be¬

Members:

senior Vice-President of the

'New

York

Stock

firm.

jAmerican Stock
Bell

TRADING DEPARTMENT—SA
Direct

Carl M.

23

Teletypes
MUNICIPAL DEPARTMENT—SA 53

Private

Wires

to

Loeb, Rhoades & Co., New York, First Southwest Co.,
Dallas,
Connecting Wires to Principal Financial Centers

and




■Midwest Stock

Filor, Bullard Partner
Bullard
&
Smyth,
39
Broadway, New York City, mem¬

Filor,

bers

of

change,

the
on

New

Jan.

York

1

Charles deTrenck to

Stock

Ex¬

will
admit
partnership.

SAN

Exchange

ANTONIO, TEXAS

South

Texas

Building /

Exchange

Exchange

(Assoc.)
--

- -

'

DALLAS, TEXAS
Wilson

B.uilding

Volume

Number

184

5594

The Commercial and Financial Chronicle

7.

.

~

(2595)
ties

taking .definite

are

this direction.
The

has

resulted

generating
000

kw.

in

this

year

000

kw.

margin

.-is

an

1947

and

was

1947

tax

beneficial

the

53%

it.us^estimated^that in

be

-

Northeast Airlines,

tax-free Y

dividends

part-of
tax-free

effects ion

a

,

..

/methods
-

.have

billing

and

substantial

produced

omies.

systems 'months

cuits

lines,
the
production of elec¬
tricity generated at the ten prin¬
cipal plants on the most efficient

Dreyfus

directs'

/basis

varying

unaer

load

New

&

York

York

Jan.

condi-

1

Co.,

and

.company
-

.ent

financing.

of

pattern

ning

oversubscribed.

plans

offer

to

The

50

Broadway,.

basis of four shares for each five

Duncan

H.

is

Net proceeds from the

of-

will

Stock

this

ther

year,

increased

'issue
ther

26%
and
by

in

1951

the

1961

the

Southwestern

officers:'; of
substantial

are

/common stockholders, the

market value of their hold¬

gate

ings

beneficial

and

ceeding

interests

San

Jan.

on

Share

earnings

idly from
stock

58

splits)

1949,

increased

cents

in

rap¬

(adjusted

1945

but the trend

to

for

then

ir¬

the

New

ance

Albert

and

In

time.

-

.

there

year

was

•

increase

an

,

.31,

1956,.

'

Chairman.
,

$1.64

predicted share
in

next

the

Aug.

Nichols

earnings of $1.80

fiscal

ending

year

LOS

has

31,

■;

1957, after allowing for
the dilution of the pending stock

1

Arnett,

A.

Quillin

and

with

has

company

adopted

a

beginning with

addition,

M.

the

Ray Harvey

was

formerly

with First International Co.

Markets In The Southwest

fall

of

Petroleum

Oil

Oil

1957.

Gulf

Airport

in

&

Boston,

CALL

Canada.

in

27," 1956

the

Frigikar
Fritz

Tekoil

Texas

National

Three

States

Pan

Uranium

Star

Steel

American

Western

Petroleum

Corp.

Pinon

Sons

Seismograph

Gas

.

Petroleum

Natural

Natural

Westbrook

Sulphur

Pubco

Sabre

-

Corp.
Industries

Gas

Uranium

&

Gas

Natural

Texas

Lone

Glitsch

Oil

Union

Southwestern

Equipment, Inc.

Interstate

Shore

Lisbon

,

Fargo Oil

T

South

Southern

Gas

Gas

Thompson

White

Corp.

.

*

Canyon Mining Co.

White

Eagle

Oil

Services

I

Effective

company

extend

to

Oil

Gas

Federal

Oil

Corp.

Georesearch, Inc.

Petroleum

Delhi-Taylor

Minerals

Griggs

Canadian-Delhi

Northeast

American

Gas

General

Gas

Beaver Lodge

beginning in

General
General

Glass

its

was

SOUTHWESTERN

route

system southward from New Eng¬
land

and

from

New York

St AI I HIS
I

City to

la'lcl an" Iru,i' "ew •J"™ V
Miami, Fla. As a part of this new
Miami Fla. As a part of this
run, the company recent y com-

C

menced

are

Franklin

A.

He

has

company

delivery

hour for

Nov.

Leon
Wilson

B.

of

Investment Co.

First

under

one

&

authorized

v

P. ;Eminger,

Mitchell,
Don

Samuel

name

in the

Building

FOR

Aztec

Montreal

Alfred

Calif

Richard

George
now

The

ANGELES,

firm

securities

be

to

and mail. The company has been
serving 29 cities in New England
and the
city of New York and

Charles D. Green, Doyle B. Haney,'
Carl I. Herndon T.eRnv W Hlein
Carl L. Herndon, LeRoy W. Klein,

issue.

S

I,
are

Mass., operates as a certificated
air carrier of passengers, freight

(Special to The Financial Chronicle)

,

reported.

»was

Herbert

Bank

Har¬

Ray

a

in the fall.)

ternational

Samuel Franklin Adds

to

$1.54 and in the year ended Aug..

in

related

Airlines, Inc., with
its principal offices at Logan In-

..

.

and

Window

:

some

for

aircraft

American

the

Haas, Jr. to

firm

Mr.

Terry have been

Advance

per

asso-

the

Treasurer.

Mr.

National

associated with Edwards & Hanly.

aircraft
with cruising speeds of 400 miles

Alfred

ciated

with

Terry,
and

Britannia* turbo-prop

and

partnership, Both have been

Colo.—A.

engaging

the

W.

Cronin

contracted to purchase f've Bristol

Exchanges,

admit.

is

ert

in the months of January,
February and March and the bal¬

York

Stock

DENVER,
vey

business from offices

each

regular until 1946 when $1.46 was
reported.
In the following fiscal

•

Df-fiR

^ iny'1957

J.

will

1

Barnston

$1.36 .in

was

of

Francisco

Harvey Inv. Opens

(Special to The Financial Chronicle)

Gittleson,
President;
John
C.
Cronin, Vice-President; and Rob-

the

of

^Deliveries

FRANCISCO, Calif. —
& Co., 460 Montgomery
St.,

members

ex¬

2,700,000.

A, R.
Y

Capital Corporation lias
been formed with ofiices at 37-12
84th
Street.
Officers are
Allan

svstem

,u

SAN
Sutro

N

Sunrise

in
of

City to Miami,
anticipated that aoout
the estimated pro-

is

It

,

Barnstron, Haas

aggre-

of

route

Capital

HEIGHTS

toward the payment for 10 Doug-

Sutro & Go. to Admit
;

result

a

its

Ex-

Directors

1962.

or

principal*

•

as

of

financing

company
expansion

Sunrise

ceeds of $7,000,000 will be applied

fur¬

No

equity financing is expected

/before
..and

;

operations

$5,500,000

O'Neill, Jr, to partner-

be fur¬ -snip.
pending

may

stock.

of-common

to

the
the

rorm

JACKSON

south of New York

and Grover

frpm

by

with

extension

1, Fahnestock & Co., 65
T\To«r
Vnrb
pit,,
_'
Broadway, New York City, memYork

used

change, will admit John J. Smith

',30%

•

be

connection

increased

.

othef than 'Arias wilPbe o'n'the"
shares held and will expire bee.
20, 1956. /

Cameron

New

*

subscription offer to stock

on

On Jan.

the

Atlas*

the

Robert F. Tulcin to

Mr.

of tne

stock.

common

of

Smith, O'Neill, Jr.
of

-

n0„.tlans.

a

Exchange,

shares Jan. 15, 1957, on a l-for-14
basis.
The equity ratio has been

*

The

f la.

bers

on

issue, offered to but not purchased
by, the other stockholders.

its

additional

292,000

Lewis B. Franklin

"

further agreed to pur-"
/.chase any part of the 45% of the *

Fahnestock to Admit

company

Roy C. Osgood

$9.50

general pub-

which presently owns 56%

Begin¬

February,
1947,
there
have
been eight
common
stock
offerings on a rights basis and
."all but the first have been heavily

price

same

12;outstanding

fice manager for the firm.

in

at

1915-17

"corp. has

admit

partnership.

the postwar period the
has followed a consist-

During

share

for- the

members

Stock

will

Cameron

tions.
.

latest-

Sept.

City,

New

'

-

the

Be Dreyfus Partners

transmission

the

Inc.

of-the-.shares

the

1920 -21

to

Cameron, Tulcin to

switching and carrier cir¬

on

at the

_

'

trol room which, through remotecontrol

;

econ¬

The company's Amarillp
building contains a con¬

office

PRESIDENTS

f]-asubscription rights basis
present minority stockholders;'
^and about 5% are being offered •and; sells ^on
same
basis to Atlas Corp.
'

V

.;

of -$1.67,
ended1

PAST

price..around 27

stock»yields _5.2%

earnings

to

l'icT about'45%" are brin/offerej

accelerated

of

'

the -recent

16.2- times

at

of operation. Mechanized

.accounting

At

the

The management has been ac^.'tive in introducing more efficient

.

„

*

offered

were

fiscal

1958

share,!; 50%

per

substantial

the

result

amortization-.--

earnings.

A

should remain

through

year

as

IBA

of

,

is Manager
of
an
investment
banking syndicate which on Dec.
12 j offered - 784,402 . shares
of

_

'.share

;

increasetoU11061 Wl 111611
.dividends : Carl M Loeb Rhoades & Co.

recent

About

and

will

few

a

ilnHlmocI Air Una*

II Ml IIIMaal '-"Ml llllvd

-

the current fiscal year about 40%.

will be

reserve

-J

* the

1, .1956, were
considered
of. current; Federal income

free

annual

over

policy and these
increases

"it,12 months ,e.nde"

Sfld,

Sept.

814,the

small, but in
This
needed and it is

decline; for '■

with

years,

-

including
$1.40.

nearly 40%.

.probable that the
to

in

very

than

allowed

In

been- 12

dividend rate in the past 14 years,

kw.

estimated

liberal- dividend
have

166,r

746,000

capacity

of

from

year.

reached

larger

increase

-

to

an

next

.peak load
•1955 it

in

capability

*

/' n- Y
growth

rapid

company's

in

steps

/'

99

.

■■■■

Mercantile Ccmmerce DUIlDlIlg

Washington,

to

service

&

FORT

MIDLAND

WORTH

(HI

Riverside 1-5471

•

ODESSA

•

Dallas, Texas

LUFKIN

•

HOUSTON

Co., 215 West Seventh Street.

New York Stock Exchange

Weekly Firm Changes

Rauscher, Pierce
•>

b'Member

-

•

New

York

Exchange

American Stock

a

«.

Stock

Co,, Inc.
•.

.

•>"

»•

Exchange
/has announced the following firm
changes:
>
;
/..,/./

Exchange

Sprayregen, Borinstein & Co., '
City, will be dissolved

(Associate)

Dec.

Dealers

-

-

r

o

kers

;

♦

Di

s

t

'#•:•#J

New York

'

B

;.v.v;q

■

Midwest Stodk Exchange

_

Underwriters

The New York. Stock

-

&

ribu

to

r

s

31.

-/"

j.

INVESTMENT SECURITIES

Tullis, Craig & Bright, New
Orleans, will be dissolved Dec. 31.
William Kaelin will retire from
limited

partnership
Dec. 31.

in

Weeks & Co.,
Morris
H.

Sprayregen

Mendelson,

both

of the

•Baker,./:*#
/

,

and

...

Irving

members

of

the

Municipal Bonds

Exchange, will retire from
partnership
in
Eisele
&
King,
Libaire, Stout & Co.
,

.

:William

draw

-Bank and Insurance

Company Stocks

F.

from

Brothers

Bohner

will

partnership
Co.

&

Orvis,

*

•-

UNDERWRITER

with¬

in

DISTRIUI TOR

DEALER

-

Philip G. Volpe, member, of the
-

Mutual Investment Funds

Exchange, retired from partner¬
ship in F. L. Rossman & Co., Dec.

Public Utility, Railroad and Industrial
Bonds—Preferred Stocks—Common Stocks

Alexander

from
Co.

J.

Leeds

31.

„

MERCAxNTlLK

BANK

Mercantile Bank

Building

Dallas I, Texas

Austin

•

Harlingen
San




Antonio

of

Robert

Donald

H.

Peters

sidered

bership

•

Tyler

of

Francis J.

Houston

sidered
John

•

Waco

L.

H.

be

Exchange

Albert

retired

13.

Abilene

•

Pemnview

mem¬

Russell

McCauley will be

Parker

to

con¬

to

con-^

by the Exchange Dec.
E.

TEXAS

mem¬

Frank

will

by the Exchange Dec.

Transfer of the

Telephone Riverside 1-9033

Lubbock

Exchange

bership

BE IIJ)INC

,

DALLAS.
Transfer of the

COMPANY

withdraws

partnership in Ungerleider &

Dec.

£<nUhu>€4t

FIRST

10.

13.

from

limited
partnership
in Auchincloss, Parker & Redpath, Nov. 30.

V.'.SVA

•

So Antom»»

»

Tyi.ek

P
m

The Commercial and Financial Chronicle
100

Thursday, December 13,1958

.

.

.

(2596)

Continued

from

increasing costs of operation.

In view of trouble in the
East, we can anticipate
defense spending and larger

(3)

Chemical and Pharmaceutical

Securities Salesman's Corner

Middle
more

aid appropriations.
This
spending makes it un¬

foreign

Conviction

First Comes
Basically there is one motivat¬
ing force behind the successful
culmination of every sales effort

is

It

conviction.

is

that

and

Industry Outlook for 1957<f

JOHN DUTTON

By

the

driving force behind creative sell¬
ing that will bring success to any
who believes sufficiently in

man

agement, product, market, or cap¬
ital.
mature

A

over¬

can

company

price its securities, a younger or¬
ganization can set up an unsound

of

vital to the success

are

factors

These

structure.

capital

an un¬

the fu¬
ture of the company's securities
There is a worthwhile reason why over the longer term. An under¬
3 securities salesman should con¬
writing imposes an important re¬
sider his work important—funda¬ sponsibility upon the issuer and
Iiis job, his purpose, and his jus¬
tification for the work he is doing.

derwriting initially and to

firm that

investment banking

mentally his purpose should be to

the

Iring "Good to Others." I believe
fiat every satisfactory effort must

brings it to market.

be indoctrinated with constructive

No matter what is made,

idealism.

sold, and delivered by each of us
to
the
other, unless there is a
benefit that goes all the way—to
the user, the buyer,

the maker and

seller—the sound

the
the

lasting

will

values

and

success

high, if it is offered at a price
realistically lied in with value,
if it is not a special situation in
all the term implies, then trouble
lies ahead—for the buyer and the

seller.

be

not

wh}'

reason

This

andl every other business.
You can't build your house on air

mean

ness,

Sand.

and

for

while

ent

organization

an

can •/>achieve
a
short run, and
sometimes sensational success, do¬

ing business
but

sooner

the

drain.

unsound basis,

an

on

later they go down

or

The

claims

who

man

that you don't have to give your
customers

value, service, and gen¬
uine benefits, is only fooling him¬
self. This has been said so often,

it needs

further repetition.

no

IIow

Situations,

There

many

young

to the lasting credit of the invest¬
the

banking business, and all of

salesmen

securities

who

have

these

of

concerns

great

national

sold

the

contribute
of all

of

institutions

much

so

At

us.

become

now

which

to the welfare

the

time

some

of

these offerings were > made to the
public, they were anything but

conservative investments. The risk
was

high

the

and

compensating

rewards

were

especially

—

f

o r

those who had the stamina to stay
and wait for their
I

ship to

today
one

that

worthy

are

thing to

that

is

view

present

which

thing

do

based

realistic
the

come

in.

believe that young companies

financing should have it.

conviction

The

lie

upon

of

and

ahead,

else

again

of

the

and

public

is

have

cons

uated,
the

sales

is

that

to

situation

the

is

carefully eval¬
brought before

then

organization

by

tho¬

a

roughly convinced buying depart¬
ment,

conviction

the

veyed

to

salesman

the

be

can

con¬

his

and

clients.

of

unless

the

upon

benefits

eventually

upon

of

which

to

should

the

firm,

and

(after all

could

we

of
not

use

a

right now), there is going to

trouble

you

create

can

tion,

a

ahead.
a

The

sales

loyal clientele,

reputation

is

to

only

way

organiza¬

or

sound

a

BUILD

YOUR

CONVICTIONS ON REALITIES.

Russell With Aronson
(Special to Thf Financial Chronicle)

these factors vary from

as

creased

some¬
any

neth

D. Russell

ciated

is

its

fun¬
man¬

Dealers

—

ager

with

under

and

in

up

reminding

of

and

has

Los

in

&

Mr.

asso¬

Co.,

426

Russell

Angeles

Man¬

for Daniel D. Weston & Co.

Distributors

Corporate

policy
through

going in
that I
predictions. If

next

—

difficult

us

forward

to

over-all

sales

a

moderate

market

of

less

no

reports

perity

for

Suez

that

Canal will

of six months.

then,

votion

we can look
increases in

to

where all

trading in
relatively
stable

to

seems

take

a

m«n

in

But

settlement.

balance

of

E.

of

(2)
quite
look.

The profit picture is not
bright as the sales out¬
We have already seen some

so

decline in chemical industry profit

margins

in

1956,

on

profits"

and

a

further

seems

to be

Dec.
a

9

short

been

a

Cotton

the

at

Telephone

riverside




1-5051

resurgence

481

as the lead¬
ideologies.
The

changes

economy

this

of

nationalism

Polish

almost certain to produce fur¬

ther

DLS

of 76 following

Mr.

Burnett

Sanders

Exchange for

many

prior to his retirement in

REPUBLIC

Company

&

INVESTMENT

SECURITIES

NATIONAL

and

makes

in

Soviet

thus in
trade

plain

her

♦

foreign

domestic

policies.

that

we

are

All
in

had

member of the New York

BANK BLDG.

Dallas

meaner

the

ever

opposing

policy and
Teletype

age

illness.

nations

of

free¬
world

a

Rodney Burnett

and

responsibility

of

E. Rodney Burnett passed away

the

political

for
de¬

prices.

United

the

our

shall be free.

the best hope for

us

tragic events in Hungary and the

bankers

Texas

and

ing of that lifeline are already
being felt'." European industry de¬
pends upon the Middle East for
65%
of its oil, and the chronic
dollar shortage in Europe and the
unavailability of sufficient tankerage will make it impossible for
many countries
to make up the
complete deficit with American
oil.
England and France have al¬
ready announced gasoline and oil
rationing.

world

Tower

time

meantime, the effects of the clos¬

are

2.

"heritage
a

minimum

a

that

me

forcefully than

Dallas

the

toward

will be

Furthermore, even

and

be evidence of

can

us

beginning the task must await
political
settlements
in
Egypt,
which will decide just who is to
do the work, and make arrange¬
ments for free access to the job.

ers

Adolphus

industry

our

people throughout the world. This,

them¬
Most recent
clearing the

indirectly.

agree

a

that will insure progress and pros¬

making

for

large

selves felt

secure.

these contributions

tinue to make

seem

dle

Company, Inc.

is

contributions to

healthier

with the United
States and Russia emerging more

&

growth

our

at

affects

situation

international trade which

major

investment

so intimately in¬
phase of life that

directly, and the Hungarian trag¬
edy will have repercussions upon

economic

Pkukixs

now

every

have to face the fact

Suez

down¬

any

chemical industry, it

volume,

"squeeze
area

mar¬

growth depends, in the long

dom"

(1) In our industry

and

life in a more
bountiful world.; All of us here,
I believe, are dedicated to con¬

the

year

the sine curve
upon the

be

there

upon

longer,

first
six
to me
reasonably predictable in at
least five major areas of business.
of

on

long-term

run,

pretend

Moreover, the crisis in the Mid¬
East seems sure to affect the

Bonds & Stocks

its

to be

posed many complex
for international trade

we

the

that

however

as all com¬
free, competitive
individual
com¬

research

its

in the

volved in

mem¬

we

are

up

from

is unlikely to persist for long. Our

eco¬

working
i'or
peace
the United Nations suc¬

months

%

international

the

In

of

Should

That

not

vary

curve

keting programs.

of

ceeds,

com¬

general.

present,

then,

well

be dependent

well

success

to

threat¬

its

a

An

pany's position
may

'

make.precise

New

political ^torm

such

Spring Street.

formerly

problems

and

;

have

pattern,

general

panies must in

com¬

off

have

may

the sine

like

economy.

President Eisenhower's announced

As the newspapers have

become

has

can

«

shall

I

to head

that

industry
'

1957?

lately, eco¬
clouds
gather quickly, and the rise
nationalism
throughout
the

been

nomic
can

the

been

"

notoriously

a

encouraging

companies
down

this

industry is

Where

Yet, attempting to plan the fu¬
trade in any
is

ual
or

Fortu¬

Association's

hazards

bers.

overseas

ground.

is

I

just made, of course, refer to our
industry as a whole. Our individ¬

trend

ened

ture of international

detail

it
the

early fall.

statements

five

before been able

Our aim has been
competition on

pletion in 1957.

business.

And

nomic

as

scheduled for

summer or

These

can,

this

increase in wages dur¬

an

mittees, which have gained such
impressive stature in governmen¬
tal circles, have more than once

number of countries,

a

are

more

in

general and we
accordance with

ing late

Manufacturers Associa¬

that

appears,

in

wage pattern for in-.,

contract

rec¬

can

contract

a

expect

Congress, to
the Executive

to

tion.

country to

satisfactory
terms.
plants have

to

Government.

know

indus¬

American-built

going

in

for the
steel

dustry

have among others such
the Synthetic Organic

we

voice

Chemical

attempted

Nations offer

Aronson

nately,
a

and
of

recent

to have set

But now,

which

action

Branch

relations are likely
coming year.

Labor
stable

be

pres¬

spokesmen capable of work¬

Customs,

.by the licensing of know-how

or

growing

world.

bership— voices

to offset
possible by in¬
capital investment abroad,
has

much

(5)
to

than ever, our industry also

ommend

country and from year to year, the

Calif. —Ken¬

ANGELES,

al¬

international

in

industry.

ing for the interests of its mem¬

a

problems

new

expansions

as

needs

I need not
importance of

chemical

these

can

we

temporarily dampen plant
in some segments of

may

The

more

trade—problems of keener compe¬
tition and dollar shortages. Since

It

of

LOS

we

facing

the envy of the

try has assumed world leadership,
but with this leadership we face

flow

customers

hope that all will be well

a

because
deal

is

appraisal

solid

underwriting

any

be

conviction

the

a

to

sure

am

American

The

world

But

South

as

If

been

and

was

damentally weak

buying

sound, if the factors have been
carefully studied, if the pros and

ipation in

venture

rgal.

I

critical

(4) The money market will ap¬

parently continue to be tight for
at least six or eight months, which

shall

We

industry will see any
tax cuts in the year

ahead.

industrial man¬
agers rely on the traditional busi¬
ness atmosphere of free enterprise
that has made American industry

aggressive marketing programs by
our
industry in the year ahead,

own

it

which

markets

the

stress

meet

business and ask for public partic¬
a

those

on

ready have.

its

possibilities
it

the

of

underwriting departments of
investment firm can only be

and

realities

finance

to

a

But it is

solid

a

the

or

abroad

and

here

Communism.

of

In

production we
are
capable of reaching, and equally
important, in keeping a firm grasp

to

underwriting

an

both

them

underwriting

an

appreciable

a

sures,

the

absorb

industry

special
situation, and a superficial going
over
that is based primarily on
guesswork and hopeful anticipa¬
tion of brighter days ahead.

and

young

have

there; problems of manufac¬
turing costs that must be solved
by technology improvements. But
our
more
serious problems today
generally lie in the field of mar¬
keting and sales—in developing

in

companies
during
the
.based
busy years, that many of

these

a

an¬

likely that

bury you all."—end of quotation.

and

alysis of all of the factors involved

growing
past

painstaking

serious problem

a

We have weak spots to
sure—problems of supply here

if

of public financing through repre¬
sentative investment firms,
it is
ment

and

But

between

difference

a

that production is
of our

I think,

now

conveyed to the sales organization

struggling and
business firms
in this country that should have
public support and are deserving
are

is

there

pres¬

future.

judging the

constructive

and

Under writings, Etc?

worthwhile

and

an

About

evaluating the

task of

not

a

impression

the

convey

the world¬
Everyone will

which reach

wide market place.
agree,

don't

I

of judgment
cannot be made in this highly del¬
icate

short

a

The

work.

won't

It

to

products

in /view of the resur¬
strongly competitive
industry abroad.

honest mistakes

that

be so prosperous that

may

But

like

almost

week.

this

side

marketing skills which
laboratory findings into

gence

sound

may

sermon

be

highly developed produc¬

and

turn

especially

Your

Reputation

so many

"fly-by-night" firms have come
gone in the investment busi¬

Makes

Merchandise

and

-times

of special
is priced

too

The
a

security

a

not

achieved.
There is

If

economy.

tion

markets

The same holds true
situations.

for

increased

period of "stepped-up com¬
petitive co-existence" which will
place
the United States under
growing pressure
to
meet
the
manifold problems associated with
world
leadership.
For
has
not
Khrushchev recently promised us,
—and I quote—"History is on the

the

out

due largely to

store next year,

in

9

page

Mu>

Q)aI/aJ, d&caJ

years

1950.

Volume

Number

184

5594

.

.

.

The Commercial and Financial Chronicle

(2597)

Continued jrom page 5

annual

an

the

The State of Tiade and
pairs

and

United

de-mothballing by the

States

make

to

the

up

$10,600,000,000
the

000

from

month

of

year,

amounted

$40,800,000,000.

$10,300,000,-

of

about

3%

This

total

Steel

Output

of

Steel

mills

resent

In

backstage
force

to

pressure

the

"voluntary"

car

and

tional

channelling of plate
to
shipbuilding.
already under the gun to
the freight car building

structurals

They

are

sustain

and

program

tomers
the
■

in

old-time

some

fields;

other

1

consequences.

While

cus¬

taking

are

plate and structural
capacity is on the way, production
of these two products will suffer
until

more

the

mills

new

are

in

place.

A

large Eastern producer will
curtaij sheared plate production
by 40% while a new mill is being
installed. The
in January,
authority.

cutback

continues

will

begin

this

trade

Steel demand from, other indus¬

tries is holding steady, or mount¬

ing. Auto producers are beginning
see daylight and their new cars
have
taken
the
public's fancy.
First quarter steel requirements
are beginning to rise.
to

After

less
steadily since last October, the
steel
scrap
market
has settled
down
momentarily
and
prices
have leveled
off after reaching
record heights.
,

rising

But the scrap

back

on

its

Purchased
nation's

industry

best

scrap

mills

or

more

year

look

can

in history.

shipments to the

and

foundries

will

total

36,000,000 tons, a new record.
Exports also are likely to set a
new mark of 5,000,000 tons.
Sales
may reach, or exceed $2,600,000,-

output,

the

on

Auto

industry the

An

"Iron

Age" survey shows
expansion has made
the scrap industry a major con¬
sumer of capital
equipment. Capi¬
tal spending this year will ap¬
proach $54,000,000 and contem¬
plated spending in 1957 will ap¬
that

steady

At

1956 passenger
of the Na¬

eve

Show,

scheduled

was

well

170,398 units.
Automotive

Reports"

is 6.5% above
the 1956 high set in the preceding
week and only 6% below the in¬
dustry

ord

of

180,754-unit rec¬
the Nov. 7-12, 1955 week.
all-time

statistical

The

agency

observed

that the upsurge "paves the

way"
for
attainment
of
the
industry
goal of 613,000 car completions
this month following sharp defi¬
cits
in
November
and
October,
adding it is being accompanied by
strong dealer sales.
The

dealers

auto

vember,

for

12.3%

a

gain

414,000 in October and

over

point¬
ing towards the 500,000-plus sales
level this

month.

It

ond-best postwar

are

the

was

November sales.

However, the reporting
cautioned

dealer

that

sec¬

service

inventories

remain out of

balance, with short¬
hardtop, station
wagon and convertible body styles
clouding the scramble for com¬
petitive shares of the auto market.
in

ages

Last
ume

4-door

week's

was

passengar

set as follows:

car

vol¬

50.1%

by

G. M.

Corp., 28.9% by Ford Motor
Co., 18.3% by Chrysler Corp. and
2.7%

output,
"Ward's"
de¬
clared, held steady last week fol¬
lowing 92,754 completions in en¬
tire November.
Car output
last
month totaled 581,088. The entire
is

outlook

for

5,800,000

car

and 1,100,000 truck completions

United

States

in

Sales

by wholesalers in October
rose
more
than seasonally from
the September level to a total of
$11,700,000,000, the United States
Department
ported.
-

of

Commerce

re¬

OOO

October

sales

in

of

October last year.

Wholesale
creased

stated.

in
At

inventories

October,
the

end

of

in¬

also

the
the

report
month

the

like

month

of

last

by
3%, a joint report of the United
States Departments of Commerce
Labor

New
month

year

It

totaled

spending last
and

$3,800,000,000

with $4,100,000,000
spent in October and $3,700,000,compared
000

spent

in

of

November

Despite the drop from the

Oc¬

tober

November

the
$12,600,000,000

$13,100,000,000
and

The

before

a year

earlier.

department said the Octo¬

ber sales increase
usual

month

was

more

than

at this time of the year.

seasonally adjusted index

rose




Its
to

Week

and

mo¬

prosperity

its

that

index

industrial

today

eclipsed

the

previous high mark of
(1947-1949=r 100) which was

164
es¬

tablished in 1955.
Two of the four segments in the
index will put it still higher. Auto

production

is

expected

Dennis H.
The

reach

to

James M. Powell

McCarthy

First

Boston

Boettcher

Corporation,

its 1956 high point in mid-Decem¬
ber.
The electric utility

'L

William J. Collins

and

William

Company, Denver

&

J.

-S'<-

Collins

Co., Portland

u

San Francisco

industry

in the

week
the

ended

Dec.

1

12,000,000,000

moved

kwh-hr

mark for the first time.

The pre¬

vious weekly record was 11,600,000,000 kwh-hr set in 1955.
The
to

steel

mills

keep at
freight

seasonal

a

car

signposts
pointing to continued good busi¬
in

the

the

first

half

gorie

peacetime

which

is

at

now

are

to

rose

postwar high in

a

SAN

Rosenberg,

and

John

'

t

New

has

Eastman
&

Co.,

joined

Scott

the

staff

bolts

and

the

of¬

with

Modesto,
as

Boulevard.

Leland

with

Manager,

E.

and

William
at

108

Street, Visalia, with

Nielsen

Glen
were

Fulton

Manager; at Hotel Covell

South Church

Tegeler & Co.

nuts

Fresno,

as

North

Lobby,

formerly with Dempsey-

3115 Wilshire

of

Francisco

San

Warner

of

Dillon, Union Securities

everything

was

and

925-A

at

Street,

ANGELES, Calif. —David

Glatt

Calif.—

members

Stock Exchanges have opened

(Special to The Financial Chronicle)

LOS

Fay,

•

Joins Eastman Dillon

E.

&

York

fices

He

from

FRANCISCO,

Hooker

W.

with Boren &

now

■

of

ciation

Calif.—Mar-

Ralph

Saul

'

a

record.

Hooker & Fay Open
New Offices

Co., 9640 Santa Monica Boulevard.

by

Further, the
the American Supply &
Machinery Manufacturers Asso¬
index

J.

Wakefield

the American Gear Manufacturers

Association,

Maltun,

Marvin

include

order index compiled

new

BEVERLY HILLS,

above

or

other segments of the index.
The
magazine
said

ness

Four With Boren
(Special to The Financial Chronicle)

expected

are

capacity,
loadings are in
decline.
They are the

while

Manager.

as

formerly

All

with Davidson

Company.

to cranes,

influences the planning
of members for at least 60 days.
New
orders
reported
by the
Industrial Heating Equipment As¬
sociation
of

this

in

the

year

in

first

ten

27%

are

the

months

ahead

period

same

of

UNDERWRITERS

DEALERS

DISTRIBUTORS

last

level, the departments said
construction
spending
the highest for the month on

was

record, rising above the previous
peak

reached

With

the

a

seasonal

report

construction

said
last

year

"Steel"

ago.

000,000,000 compared with
000,000,000 this year. One
tion

included,
outlays for new
were

the

to

upward

$135,-

TEXAS

excep¬

trend

was

noted, it said housing starts

may

down

Municipal Bonds

•

Corporate Securities

1,000,000 or less next
due to the tight money situa¬

year

tion.
of

•

to

This could

$300,000,000

mean

or

sales loss

a

in

more

home

components, with major appliance
makers also

feeling the impact.

Pressure

finished

from

steel

Members Midwest Stock Exchange
TELEPHONE

shipments in the United States is"
expected to mount as the squeeze
on
certain
products,
plates, tightens.

Despite

CApitol 2*9944

notably

TELETYPE
HO 395

the

heavy production
loss caused by the strike, finished
1330

steel shipments this year

factors

month

predicted metalworking

dollar sales in 1957 will hit $145,-

last

year.

book value of stocks amounted to

with

This

Capacity

carry

declared

production

be

disclosed.

construction

$13,500,000,000,

compared

NORTHWEST

year.

Outlays for new construction
put in place dropped 8% in No¬
vember from October but topped

and

volume compared
$10,400,000,000 the
previous month and $10,500,000,The

with

MOUNTAIN

the first half of
1957,
magazine,
the
national
metalworking weekly, stated on
Monday last.

proximate $46,000,000.
.

ROCKY

into

those

plants.

PACIFIC

CALIFORNIA

October. This index, which covers

by remaining producers.

1956

.*

11-

"Steel"

an

estimated 465,000 new cars in No¬

of

will

above

retailed

year's

high ground,

new

mentum

"Ward's

climb

Industrial production is
moving
into

by United States assembly plants

stated the program

Placed

102.0%

at

Truck

000.
i

automotive

past w'eek, record

IBA GROUP CHAIRMEN

ex-

nearly
a

$39,700,000,000.

deficit, declares this trade weekly.
government

to

was

last

over

month

'

construction

new

penditures

before.

$44,600,000,000, M/////MM////M

highest rate since June.

this

Industry

rate

101

at

only slightly

will fall
below the total for

OF THE

BANK

SOUTHWEST

HOUSTON 2, TEXAS

1955—84,000,000 net tons, against
"Steel's", explanation

84,417,444.
is that
will

higher yield from ingots

a

73.04%,

approximate

72.39

in

versus

1954

and

composite

for

in

71.51

1955,

in

71.81

1953.

"Steel's"
finished
$137.66

price

steel

is

net

ton.

a

unchanged at
For.,the first

time since 1948, steelmaking scrap
is

selling

The

stands

trier lie.

basic

above

composite price
at

$62.18

a

on

gross

pig iron.
pig iron
ton. The

price

composite on scrap
$66.17 a gross ton, up $1.50.
The

American

rate

erating

of

and

Iron

announced

Institute

is

that

at

the

op¬

96.1% of the steelmaking
capacity for the entire industry
will be an average of 102.0% of
capacity for the week beginning
Dec.
10, 1956, equivalent to 2,having

k Exilian <:e

511,000 tons of ingot and steel for
castings
of

capacity,

The

rate
based

a

and

2,493,000

tons

week ago.

on

the

,

weeks

in

1956

is

annual capacity of 128,-

363,090 tons
For the

SECURITIES

Fvidley, Hess
&.

Frederkin
BANKERS

INVESTMENT

MEMBERS

617

TEXAS

MIDWEST

STOCK

NAT I □ N AL

as

of Jan. 1, 1956.

like week

Continued

HGUSTGN

2,

Telephone CApitol 8-8221

Industry's ingot production

for

MUNICIPAL

EXCHANGE

BANK

BUILDING

compared with 101.3%

as

(revised)

AND

Steel

companies

steel

CORPORATE

a

on

month

ago

page

102

TEXAS

Teletype HO 42

BLDG.

&

4

102

The Commercial and Financial

(2598)

Continued

from

Chronicle

.

.

Grain

101

page

the

The State of Trade and

CHAIRMEN

GROUP

IBA

the

WESTERN

OHIO

NORTHERN

PENNSYLVANIA

OHIO

rate

lion

VALLEY

100.2% and produc-

was

2,466,000

tons.

A

year

placed at 2,421,000 tons
The

$100,000 as against 20 in the
ceding week.

was

operating

rate

100.3%.

or

not

is

capacity

in

1955.

The

cenlage figures for 1955
annual

on

io»s

capacity

Ja„.

.1

as

I,

mercial

based

are

while

Under

Ail-Time

New

failures

contrast,:

High Set

by

the, electric light
"industry for the week

power

ended

Saturday, Dec. 8, 19o6,

estimated

Thomas

The

Company,

&

Jack E. Nida

Clarence F. Davis

Anthony E.Tomasic

Merrill

Cleveland

First

*-

ended

Lynch, Pierce,
& Beane,

the

Columbus

Cleveland

Dec.

a

the

New

will

York

kwh.

Wall

Stock

Dec.

Anthony J.

quire

a

20.

at

City,

Partners

will

Cortese who will

membership

Frantz,

Maurice

Di

in

the

general

ef¬

week,

ended

week

partners.

that

which

all-time

new

the

Dec.

it

621,000,000

,

2,201,000,000

Car Loadings in Week

the like

and

Jospph Fanelli, Bernard T. Wilens,

S.

ANGELES,

Menzies has

with

Edward

South

Calif.—Robert

become

T.

Rose

week

in

1954.

Cronin

Co.,

548

Spring Street.

Ended Dec.

15.6% Above
Holiday

connected

Loadings of

Preceding

Week

;

INVESTMENT

DEPARTMENT

the

S. Car Output

High
Car

ST

P

159 MUNICIPAL DEPARTMENT
132

TNADING

DEPARTMENT

set

the

at
.

bled

the

latest week
according _to
Reports,"

1956,

7,

1956

ior

Automotive

1956.

in

Record

Dec.

Last

ST P

Last Week Rose

output for

ended

"Ward's

TELETYPES

cor-

Above Previous Week's

6.5%

was

the

1954.

»

GOVERNMENT, STATE

AP MUNICIPAL BONDS

in

week

1955
90,373

of

above

13.7%

or

•'

U.

increase

an

responding
■

U. S.

ended

corresponding

and

week
cars,

BANK OF SAINT PAUL

week

1, 1956, totaled 752,150 cars,
increase of 28,364 cars or 3.9%

above

highest

the

industry

estimated

an

level
/

;

.

week

of

assem-

170.398

cars,

previous

week.- The past
production
total of > cars
trucks amounted
to
194,586

week's
and

units,

Food

week's

Underwriters and
of

t

Distributors

Four

Week

Registering

the

—r-ss
•

Last week

Shares

week

ST.

National

PAUL

1,

output advanced

Price

MINNESOTA

178,409

year

trucks

were

cars

assem-

reported

agency

24,188 trucks made in

were

United

and

the

week

States.

Domestic

balances

in

drop

and

Establish

High

The

fell

248

,

.

h

300,723

stocks

from"

bags

week

earlier.

these holdings

were

This

bags.

Live

hog

prices

trended

higher;

lamb

prices.

-:L

:

at

trucks.

In the

able

'

fewer

uting to the easiness was selling"
prompted by the improvement in
the

international

loan

rate next

situation
the

to

as

season.

Tending to support values

new

10,090

month-end

price-fixing

unexpected

increase

were

and

daily

wholesale commodity

in

price

the

cotton
'•

j

s(reet

registered
&

'

300.18

a

of

Nov.

25

upland

for

15.

active. Purchases
ended

Nov.

30

totaled

511,900

week previous and 276.91 on the bales
corresponding date last

against 540,500 the previous
week and 255,500 in the same

year.

was

2,242
previous week Do¬
for

'week

the

6,422

cars

and

compar¬
cars

SMITH, POLIAN & COMPANY

and

Members

Midwest

Underwriters

Failures

;

Stock

Exchange

"r

■

I

and

Distributors

Advance

We have

Commercial and industrial fail¬

ures

increased to

270

in the week

SOUTHERN

active retail interest in:

an

UTAH

POWER

ended Dec. 6 from 254 in the pre¬

ceding

week,

Dun

&

Bradstreet,

Inc., reports.
The toll was up
sharply from the 219 last year and
the 223 in 1954, but it remained
9%

SOUTHERN

EDISON
1

COMPANY

Common

CALIFORNIA WATER COMPANY Common
SAULT

ELECTRIC

COMPANY

Common ~

WASHINGTON NATURAL GAS CO. Common

below the prewar level of 297

in the comparable week of 1939.

Failures

$5,000
SAINT PAUL




1, MINNESOTA

or

involving liabilities of
more

219

a

An

increase

small
under

week

ago

rose

to

225

also

casualties

occurred

with-

among

liabilities

$5,000, which climbed to 45

from 35 in the previous week and
33 in the similar^ week? of- 19551

Twenty-five

of

the

424

Omaha

National

Bank

Building

from

and 186 last year.

failing busi-

was

during the week

Further In Latest Week

FIRST NATIONAL BANK
BUILDING

an

points

Trading in the 14 markets

on
.

price

parity
as

of

and

cars

plants built 9,405

1955

Business

Investment Securities

and

probable

860 trucks.

Harold E. Wood & Company

•»

£3"° and taished sliehtl^
thd^a wee£^

compared

output last week

placed
minion

.

A:

273,-:

at
the
week-end,
while
heavy
receipts depressed both cattle and

Prior

fljrther

_

to-

Active buying of lard>
prices for that commodity;
to the highest levels of the season.:

commodity price
to advance, last
d

steady

were

a

uncertainties

and reac<>ed a

any

lifted

1952

general

of

warehouse

to

bags

year ago

Since Mid-April

continued

level

absence

prices

307,988

Further

a

the

declining

which

Commodity Price Inde*

to

all-

reflecting

•

to, show the general trend of food
prices at the wholesale level. :

New

for

moderate
pur- chases for manufacturers' account',

,

Week

in

Cocoa

firm

The index represents the sum
total of the price per pound of 31
foodstuffs and meats in general use and its chief function is

of

' demand

belief that wheat prices have
reached levels where greater marketings will be attracted,

raw

•>

at

a

steers and lambs.

Advance

easier

were

important price developments and

Bradrtreet, Inc., fell to $6.14 on
Dec. 4, from the six-month peak
of $6.16 a week ago. The current
figure represents a rise of 2.5%
over the year-ago level of $5.99.
Higher in wholesale cost the
past week were rye, bellies, coffee, tea, potatoes and hogs. Lower
were flour, wheat, corn, oats, beef,
lard, butter, milk, cocoa, eggs,

Extended

raws

types of flour remained very slow:
with buyers content to draw upon

Period

first

>

year ago.

a

2,128 trucks and

I

•:

week

25,062 in the previous week

27,870

Canadian
Building

the

for

"

Domestic

Index

Dec. 4, as compared with 299.96

there

Bank

In the correspond-

last

27,870

with

First

4.

k]ed

the

8c
COMPANY, INC.

)

_

index, compiled by Dun & Brad-

Last

•

fu-

=q

the week-end following announce-'
ment of an increase in domestic >
sugar quotas to a record 9,000,000 '

r "ew
high since mid-April 1952. The

and

SHAUGHNESSY

s car

dipped

beyond that of the previous week
by 10,422 cars, while truck output declined by 874 vehicles durir'K

Funds

'■iv-.-v

n„i.„

.

bushels

years.

irig the week.

Corporate and Municipal Securities

Mutual

„

S0Ybeau

.

four weeks, the wholesale food
price index, compiled by Dun &

preceding

states>."Ward's."t

output,

.

the

of

-

of

PTe-

Registers First Decline in

.

that

hieher

to

Vomrne

anristot

tons.

increase I of 9,548 units

or an

above

y

"

States.

Wholesale

the

I

agafnst c;5 ^n 0n0 bushels the
•"
^fous week
bUShelS the pre '

the

exceeded

in five regions,

level

Wholesale

Railroads

Dec.
an

THE FIRST NATIONAL

the

Failures

8.

Mountain

reports.

for

prices

d

500000

slightly below a year ago in three
regions " and
held - even
in
the

1, 1956, were,

American

Loadings

I

¬

with

101,230 cars or 15.6% above the
preceding holiday week, the As¬
of

'
*

»n

of

14

to

larcelv

due

oil

trading fa gr£dn and
T

freight for

revenue

the'week ended Dec.

sociation

tn

Reflecting' the gradual upward *
trend in the raw sugar market,-the .
change from last week occurred
of refined sugar was moved ^
in the West North Central States UP
.e 1 ^
^ Pu°U? f .St
with 6 or the East South Central week to $9.10, the highest in S3
1955

1,

attrihuted

in

advanced

four other regions reported lower

the compar-

and

kwh.

LOS

-up

firmness^n

relative
was

tic States, down to 79 from 93. No

ISpecial to The Financial Chronicle)

I

edged

«rain

^bean

concen-

from 12
in the West South Central States,

be
ac¬

was

to 89 from 68
North
Central

East

t

°So7bS.^rtoS

tolls, including the Middle Atlan-

With Edward Croni*

over

the

>

South

:

-

11,614,000,000

above

week

\

since ithe
1955 when

increased

5.4%

or

1955

•

failures

.

24,

reached

kwh.

in

nS

i

the

cash"^aXts dnd co^
uiht produ«r ma?keti^eS
Q-.
• . | trended slightly lower
"if reoortS Ses of CanadKin

States with 39 as against 27. While

the

of

rise

climbed

toll

and

to

registered

high

output

able

New

partners,

R.

Miceli,

40

York Stock Exchange, and Barbara
A.

limited

Exchange,

offices

Street, New York

fective

Lewis

Carlson,

and

according

under

kwh.;

Diamond

Co., members of

with

be formed

M.

Edward

1956

th

^ngth

trated in the Pacific States where

The past week's output fell 28,-

previous

Form A. J. Cortese Co.

1

-

reportedst

at

in

3in

whole-

nor

-

week's

The

,

Electric Institute.

Edison

000,000

A. J. Cortese &

12,047,000,000 kwh,
below the week

the

from

whe^t

markets

^

as many casualties as a
marked increases
level occurred in

other lines.

moderate drop

a

Fenner

Corporation,

Pittsburgh

at

from

was

th

20, -was
iirriited

raised:

ago, but
the 1955

year

als0
CCC

of

d

wholesaler

of

.Neither manufacturing

;The amount of electric energy saling had

and

^Ip

declined to 16 from 29 last week,

..

tensions in the Mid-

East,

resulted

com-<

from

39

In Preceding Week

distributed

27

to

service

L95V.

Electric Output Drops Moderately

war

die

trade, groups

milderincreases,

.

profit-taking as
following the

easing of

pre-

ing toll rose to 141 from 129,

per-

grains,
being
sub¬

some

subsided

during the week. The retail-

ures

125,828,310

of

and

heavy

to

irregular s

were

with

week

demand

except wholesaling had more fail-

com-

parable because capacity is higher,
than

industry

All

-

jected

of

excess

markets

past

particularly ~ wheat,

Industry

had liabilities in

nesses

ago

weekly production

the actual

Thursday, December 13, 1956

.

OMAHA

2, NEBRASKA

Telephone—JAckson
Teletype—OM

5065

180—181

Volume

Number 5594

184

'.

.

.

The Commercial and Financial Chronicle

ioai

(2599)
week

tries

a

the

CCC loan

ago.

year

in

ended

week

were

reported
against 277,200

ume

23

232,900-bales,
week earlier and

at
a

336,000 two weeks

of

level

en¬

Nov.

of " the

wholesale

trade

.

the

ago.

Federal

Reserve

dex

for

week

the

Trade Volume in the Latest Week

the

-A Year

Ago

ended

Wednesday^

on

recorded.

of

appliances

The

total

tail

trade

3%

to

in

1%

cording

the

week

above

a

Continued

South Central —4' to 0; East North
Central —1 to -f3; West North
0

Atlantic

to

-f-4:

East

Central H-l' to
m 5
Coast —6 to —2%.

Consumer"

does take

and

which

South

sU

buying,

of

•

the

similar

think

apparel

Chirstmas

boosted
.

period last
sales

sales

of

year.

and

nosiery

Furniture
creased

and

a

of

those

of

the

rate

age

is

f

:

j

in

sales

week

to
in

fresh

pro¬

products

and textiles fell somewhat

increased

lines

of

make
their

low

buying

apparel

a

in

home

and

1, 1956,
registered.

,

Population

$153 bill.

$385 bill.

04%

$3,617

employed

$2,333
$6,012

66%

127 mill.

Labor force

152%

$1,200

-2iL:

___

165 mill.

30%

53 mill.

66 mill.

25%

42 mill.

------

Employment

% Chang©
1933-1955

.

64 mill.

52%

.■

1, 1956 to Dec.

that

period

Real GNP per capita.
Real GNP per person

1955

of

in

rise

a

the

corre¬

1955.

S

lBA GROUP CHAIRMEN
MICHIGAN

MINNESOTAv

level

people wish to have.

any

it

or

rate of

more

the

not plan¬

are

further

to

decline

new

is

the

but

absolute

little

of

con¬

change of income is by far
important factor. Let me
this point a bit. Many

more

on

people

attribute

rate

at

as

the

to

the

record

levels.

is

the

H. A. McDonald, Jr.

Lawlor, Jr.

llomblower

&

McDonald-Moore

Weeks,

Chicago

are

Co,,

C. Edward Noward

<£

Piper,

Detroit

J affray

&

Hopwood,

Minneapolis

really

judgment,

my

that most people

not

Wm. J.

birth

of, recent

But

significant point, in

10 years.

high

prosperity

It is true that incomes

years.

in the 20

group

I agree,

that

me

income

expand

sub¬

30s.

certain

of

sequence, while the direction and

that the

say

to

seems

are

MISSISSIPPI

more

VALLEY

SOUTHWESTERN

TEXAS

birth rate in

the

been

1930's.

rapid that they are more
than they ever expect¬

so

prosperous

level

extent while

not "make

bumper

crop

big impression
:i '-■ y ■ '.> :

a

about 1971.

ed

to be.

;

*

"

to

lies.

I

number

of

There has been
years

do

births
a

have

think

"can't

or

theythemselves
growing up. \
■: ; \r f

were

The

per

1930's

ample

trend in

that

children"

more

it," it is usually in terms

formed '' while

provide a clear ex¬
this.
We are told that,

of

the

trend

low

can

towards larger fami¬

not

considerable

a

of material standards which were

.

reason for believing
the birth rate will turn down con¬

the

that the

me

they are quite young.
people say "we can afford

When

'.'.•/.'."My- second
cerns

to

seems

living that people aspire

to is determined to

will
until

Larger Families to Decline

It

of

afford

family.

for food

Dec.

also

1935

(in

a large influence
the number of children that

upon

Thus, for that
group, 30 to 40, the birth rate

recent

„

above

will not begin to turn up
appreciably for about 10 years,

and

duce remained at the level of the

While -orders

2

cumstances have

age

group)

reported a noticeable
in food buying the' past

foods 'and

Consider, for example, the
Continued on page 104

Changes 1935-1955

Real Gross National Product
1955 dollars)

30

ally

of

preceding week.

ago,

4%

The number-of girls in their mid¬
dle
20s •- (the
most
fertile ;age

below both

previous

to be!

exception¬

*;

dishwashers

were

Economic

age; category?
The plain, prosperous than they ever were,
fact is that there will be fewer but that the rate of increase in
income in the past 20 years has
of them because of the

;c-L:

frozen

I

thejc*20s

almost

to

pur¬

Week... $he call Tor fr^sh irteat,
•butter,; cheese and canned gooas
-was sluggish.
Purchases of poul¬
try,

ending
was

and the postwar

.

Re¬

CENTRAL STATES

stantial contributions to the birth

acces-

'Grocers
decrease

revealing
when

What of the

equipment,

major appliances
'last" year.

of

sponding

children

compared with the past

automatic

laundry

weeks

change

don't
neighbor¬

in¬

rise

And

increase that would have

department

1, 1956, the index recorded

I

oc¬

i slight

an

-

each

reported

slackened.- ",

Despite

secrets

ning

chairs, but interest in
upholstered
chairs
and
dining

chases

in

the.ffuture?

am -

children in

casional*

room: sets

of the

bedding and

of

index,

For the period Jan.

warm

4

page

f

handbags.

dealers

sales

from

girls who. have' had three

sories, with considerable increases
in

no

New

to

part

women

of

I

hood

promotions

fashion

four

have already had.

What

■

expanaed
noticeably last Week,
but slipped somewhat below that
of

in

account

the

group

Pacific

and

^

:

in

increased productivity.

what

Population Growth Concepts
And the Economy of Tomorrow

per-\

New ' England
—51' to
Middle,-Atlantic and West

South

period Jan.' 1,

volume

due

ago,

&

centages:

Central,

trade

from

esti-/

mates varied from the comparable
1955 levels by the. folio wing

Mountain

the

also

was

Federal

like period of last year.
In "the
preceding week Nov. 24, 1956, no
change was recorded.
For
the

1956,

City the past week dropped

year

ac¬

Dun

Bradstreet,, Inc..., Regional

■4-1;

1%

-

the

sales in New. York
City for
weekly period ended Dec. 1,
1956, showed no change from the

5% to 10% below the like period
re¬

ago,

by

two

from

was

year

estimates

to

of

that

the

1, 1956, a gain of 3%
registered above that of 1955.

York

-

a

dollar volume

of

For

Retail

ma-.

sluggish.

was

fact

store

In the

year.

to

Board's

serve

1956 to Dec.
was

passenger

sharply, interest in

cars rose

3or

increase

an

week, total retail trade was
slightly below that of a year ago.
new

the

According

1,

below those of

period last

the four weeks ended Dec. 1,

last

.While volume in

and

TABLE

in¬

Dec.

preceding week, Nov. 24, 1956, an
increase of 1% was reported. For

Although consumers noticeably
stepped-up their purchases; of ap¬
parel, furniture and linens in the
period

like

Board's

iended

1956, declined 1%

^Declined Slightly Below Level of
■

weather

the

at'

preceding week.
•J more days remain for shopping
Department store sales on; a than was the case last year, traae
country-wide basis as taken from observers note.

be explained by the fact that

birth

people

rate

"couldn't

Newell S. Knight

that period

of

week

will

some

that there may be some movement

many

children."

in

mean?

,

Mercantile

Company,

Albro F. Stepp

Trust

Taylor B. Almon

_

City National Bank &

Louis

St.

Trust

Rauscher, pierce

Co.,

Co.,

Inc.,

&

Dallas

Even in the 30's, the stand¬
living in the United States

fur¬

nishings held the total dollar vol¬

continue, and I rather expect

the

opposite

observers

say

direction.

that

Most

ard of

economic cir-

was

been

afford

What

to

have

does

much higher than it has ever
in
most
of the world.
In

income, that

ex¬

planation

DEPARTMENT

City

that

terms of absolute

1NVESTMENT

Kansas

no

at

all.

makes

sense

But in relative terms, it does. We
know that measured against an

aspirational

level

formed

1920's, incomes did

in

the

Piper, Jaffray & Hopwood
ESTABLISHED

too low.

seem

1895

Future Per Capita Income
MINNEAPOLIS

2, MINNESOTA

What
store
come

Specialists in state and municipal bonds of

but

Minnesota, North Oakota and South Dakota,
-

does

as

it

the

this

on

future

shock

a

seems

to

hold

This

count?

of

some

in

may

you,

UNDERWRITERS

highly unlikely that

capita income will increase as
rapidly in the next 20 years as it

MEMBERS

per

and U. S. Government bonds

did in the last 20.

NEW

AMERICAN

YORK

look at

us

178

clusion.
the

Between

real

Gross

EXCHANGE

EXCHANGE

STOCK

(ASSOCIATE)

EXCHANGE

Table 2 where I

have presented some,approximate
figures which lead me to this con¬

TELETYPE —MP

STOCK

STOCK

MIDWEST

Let

& DISTRIBUTORS

CORPORATE & MUNICIPAL SECURITIES

1935

and

National

MINNEAPOLIS

1955

ST. PAUL

GREAT FALLS

BILLINGS

Product

A in 1955 dollars) increased from
$153 billion to $38o billion, a gain,

£

,

of 152%.

Population increased by
during that period so that

30%
,

MINNESOTA

NORTH DAKOTA

MONTANA

SOUTH DAKOTA

the

gain in real

was

What

was

crease?

the

There

factors.

source

there

output

amounting

principal

was

an

Kalman &

in¬

MEMBERS

for

the

20

.

key

point,

there was an in¬
crease
in
employment
of 52%.
More people working, plus great¬

TWIN CITY STOCKS

STOCK

EXCHANGE

"

•*

•

But in addition, and this is

years.

the

Company, Inc.

MIDWEST

worker

per

66%

to

of this In¬

two

were

First,
in

crease

MUNICIPAL AND STATE BONDS

capita income

per

94%.

UNDERWRITERS & DISTRIBUTORS

CORPORATE

&

MUNICIPAL SECURITIES

output per worker.

er

Productivity Gains to Slow Down
Mcknight

ALLISON-WILLIAMS COMPAN Y

We

MINNEAPOLIS, MINNESOTA
..

-

Phone: FEderal 3-3475

-

Teletype: MP

a

163

are

close

or

backlog

potential

output

CiI2iSI32iSfSJ,5I5iS]Sf5I5ISlBIBISI33H5J5ISfSH5fSf5ISi5I5I5iSr5]5I515®5J5J5M5J5I5i51BI5I5fti




now

to

the

it.

of

at full

We

longer have
unemployed as a

source

per

entire

employment,

capita.

no

of

increase

From

increase

now

must

of

building

MINNEAPOLIS
FEderal

ENDICOTT

ST. PAUL

1, MINN.

9-8931

CApitol

TELETYPE—
MP

120

4-3303

TELETYPES—
ST

P

ST P

on,

come

BLDG.

1, MINN.

93

117

(Corporate

Dept.)

(Municipal Dept.)

"

104

The Commercial and Financial Chronicle

(2600)

Continued

from

103

page

.

.

.

Thursday, December 13, 1956

more

resources per

innovation.

CHAIRMEN

GROUP

IBA

Population Growth Concepts

"Better workers"

And the Economy of Tomoiiowing>
HVVAIVili; W*
AVAllVAivn
1MW

„

,

.,

_

....

predictions

,

talking

.

,

on a fairly specific,
measurable characteristic—quantity. But when we look at output
in the third sector, we have to
come to grips with another dimen-

that if the rate of in-

sion, quality, and this is something

of per capita income is to
maintained, productivity will

which statisticians and economists
find very difficult to measure.

published

means

in

crease

be

have to increase by 123%

ing full

employment

(assum-

in

1975)

as

compared with 66% in the past 20
Andrew S. Beaubien

Thomas B. Gannett
Hornotowcr &

L.

WeeJcx,

Boston

York

Co.

G.

Beaubien

Ltd.,

<fc

Montreal

Even if Drucker's population estimate is high, as I believe
years.

it

is,

the

productivity
would have to be far greater than
we have any reason to expect they
gains

will be.
If

'

in

are

or

individual
and

clear

a

increase

of

case

productivity

one

in

quality of program, deteriorates?

literacy
what

Even

in

in the

as

Table 3 shows that

pro-

ductivity has risen much faster
agriculture than in either industry or the rest of the economy,
in

INCORPORATED

*

years ago, one out of
four workers was employed
agriculture. At present, only a
bit over 10% of our working pop-

questions

ulation

BUILDING

WILCOX

tor.

is

employed

Therefore,

even

in

that

if productiv-

itv in agriculture

PORTLAND

4,

should

the next 20 years

OREGON

(as it

do)
Bell

it

feet

System Teletype PD 280

have only

can

triple

is

small ef—

a

which

some

true of indus-

even

employs

only

30% of the labor force

about

The great-

to

how

the

growth as well.

will

tell

you

country,

•

consider

the terrific losses in output which
can
be attributed to
alcoholism,

disease,

disturbances,

mental

the death of leading
peak of their ability,
Consider
how
many,, situations
there are (and you probably know
of some) where output could be
increased 20 or 30% if the workers
men

or

the

at

without any new
large scale invest-

even

or

ments.

1

U

p°lmlatlon

advances in health, in education,
and -1? Provic*V\£ security without
sacrificing mobility or incentives.

After having gone to some
length to show why the rate of
population increase may slow

p
Vv
What about new resources, by

Wealth

Not

Based

BaSed

.

Ponulation

on

r

t

nIf

»

n

as a surprise which I mean piincipally capital,
reaction to this It is obvious that the more equips
finding is—So what! Why all this ment each worker has the more
emphasis on counting noses any- productive he can be. Will the
Wciy? It would seem to be s. grcctt
of new cspitsl iormHtion con-®
deal more important to be con- tinue as rapidly as in the past?
cerned with the quality of our This depends in large part upon

down, it

in

well

may

the over-all total. To

on

extent this

try

sec-

apply

can

who

quality cf education, which I
Improvement of the individual
mentioned earlier. In fact, this worker has always been important
variable of quality is directly con- in this country; it will continue to
nected with the question of popu- be so. But this will require new

Twenty

every

of

in
1929

this

emotional

kind

the next two decades

past two.

BLANKENSH1P, GOULD & BLAKELY

disease

or

iri

And

he

We

difference this makes.

a

why we should not expect per
capita income to grow as rapidly

this?

measure

what

w}10 ^as tried to increase outt

much deterioration offsets how
much of an increase in number wanted to,
°f sets? Or vice versa? The same inventions

we

and

produce.

put where there is widespread il-

Can

son

Pacific Northwest Securities

to

relatively healthy and rela—
tively well educated, tend to take
£hese things for granted. But any-

Let us consider television, for
example:
Let
us
simplify
the
problem and think of productivity
in television as having two avenues for development—number of
sets produced and quality of programs. If the former increases, we

have

man

Wants

gj-e

national product. But what if the

;

examine past

we

we

agriculture
concentrate

the economy, we find further rea-

ESTABLISHED

lot. It

mSe,

emoti°nai stability,

increases in the various sectors of

\

covers a

major emphasis is usually
given to capital expenditures or
new inventions, let
us not underestimate
the
importance of the

about output in
industry, we can

This

New

briefly at

the

.

,

by
Peter
"Harper's
Magazine" last year. He foresees
an increase in population over the
next 20 years of "at least twofifths."
He also
says
the labor
force will increase by one-fifth,
Drucker,

Drexel & Co.,

worker, and

look

and attitude towards work. While

„

following

Walter H. Steel

us

CANADA

NEW ENGLAND

NEW YORK

Let

may

to you that

come

my

the saving

that rapid
key to

Under full employment,
the only way that capital can
c01>ne lnto existence is by people
consuming, or saving. People

economy. If this country
to be a great deal richer,

economic prosperity and economic
growth. I wonder!
If that were

raust d® willing to give up the
chance to consume now in order

ier,

true, wouldn't China and India be

consume more in the future,
ana tftere must be an efficient
mechanism whereby fheJr not
consuming is translated into proauction of capital equipment. It
1S vcjy difficult to speculate about
Pe°P*es aaXJnS habits, but it -is
feeling that saving, and capital

est number of

in

not

are

try, but

tiary

State and

Municipal Bonds

U. S. Government Bonds

in the so-called terservices sector of the

are

or

is going
healthhappier 20 years from
it will have to be principally

and

now,

because

of

improvements

the

where

sector

gains

I

First

seem

to have been smallest

because^wherf ^ve

est

there

is

how to

DEPARTMENT

Seattle 24,

Sector

we

know

niGRsiirG

talk

about

this third
question
what

sector,

When

worker

a

Washington

Telephone Main 3131

Teletype SE 489

Member Federal Deposit Insurance Corporation

the

amount ofi wheat

same

that

there

has

been

an

there

been

Do major

UNDERWRITERS!

produce

BROKERS

what

to?

We

answers

js primarily a problem for

increase

any

J

increase

in

really
to

know

It

TABLE
.

_

,

3

Productivity

in

Physical output
Labor input

perhaps more important,
hardly know how to go about
getting the answers. As long as

1955 (I93o

INVESTMENT
820

SECOND

Other

300

250

190

170

220

160

150

Productivity

<T4
FIRST

AVE., SEATTLE 4, WN.

PORTLAND




•

•

Telephone MU. !$00

SPOKANE

OF

PORTLAND

SECURITIES

•

EUGENE

•

•

Teletype SE. 482-673
OlYMPIA

OREGON

100)

Industry

NATIONAL BANK

Marshall

—

and

Agriculture
150
70

Exchange, American Stock Exchange (Associate), Chicago Board of Trade

&

•

.....

and

is

DISTRIBUTORS

Foster

<

appiopnate,

is

„

the

questions,

atomic energy and

Approximate Indexes of Output, Labor Input,

than they used

don't

these

at on.

The futuie potential of atomic
therefore, to examine the real energy is undoubtedly great, but at
factors which are the basis of all present, and over the next two
gains in productivity and economic decades, I cannot see atomic
growth. They are: better workers, energy bringing about any revolu-

league baseball players

more now

J" *ngs

s^^fi^stt^°htechrologi<;al
novations that have been stealing

mone-

social workers?

or

an m-

atomic Contribution
produce.

we

MEMBERS: N«w York Stock

come

satisfying peoples' wants for

and fiscal policy. Over the au 0

be

the productivity of teachers, min-

isters, doctors

will not be at

cr®ased rate in the years ahead,
iaXl f* blt«
The third source of increased
anywhere productivity is innovation, by

™n, demand (that is, effective
demand) may fall short, but this

productivity. But what about
all
important third sector?

Has

SECURITIES

formation

Soods snd services. In the short f^rently (snd -better). Let us con-*

as

this

MUNICIPAL

the

is

^"sonLleamen S Z?e
in

CORPORATE and

us

in

demand side of the question of
economic growth, if you are talkin& about the long pull. I don t
nea**

when

can

than

the richest countries in the world?
Are we to believe that if the
population of this country ever
reached a stable plateau, we could
no longer look forward to high
employment or increasing productivity? It seems to me that there
is a misplaced emphasis on the

think we have

nroduces

two autos instead of one, or

population growth

to

is

In sericulture

it

rather

mere quantity.
Ah. but they tell

or

as

it

industry this problem is not

severe

BOND

in

some

whether

or

Service

Measure

"seem to have been small-

sav

productivity

National Bank

this

precisely
productivity

the past.

Cannot

-

in

But this is

in

Seattle

indus-

or

third sector.

IT

population

workers, about 60%

agriculture

Volume

184

Number

5594

.

.

The Commercial and Financial Chronicle

.

tionary changes in productivity in
the United States.
The

limitations

materials

of

fissionable

for

powering vehicles
was pointed out
by Gordon Dfean
in his talk here last Dean's Day.
Its principal use in the next two
decades

is likely

type

fuel

of

as

generate

electric
steam

examples of it in

some

the

Federal

the

modern

form

For
are

the

in

need

badly

York

City

the

of

the

as¬

following

seem

to

be

organizational

plants. Its commercial application
depends
primarily
upon
costs

innovation.

relative

method of controlling the weapons

other

to

of

types

fuels.

That is why I say that it will not

bring about any revolution in the
United States, where other fuels
are

relatively

cheap, and where
fuel costs are only a small part
of the cost Of electricity. Atomic
energy could be a very important
factor in

other countries not well

endowed

with

conventional

more

fuels.

;

-

-

'

-

11

Automation's Contribution
-

I

What

the

output

and,

to -correct

control

to

feed-back

a

input

for

some

from
errors

machinery.

the

of

flow

United

investment

States

nations.

need to develop
to
expedite

we

devices

to

the

from

capital

hungry

-

These devices must both

anization, something which has
been, going on in this country for
a
long, long time. One writer,
John Diebold, says, "the nature
and rate of population shifts due
to automation

are

of magnitude

with which

historically
which

we

both of

familiar
able

are

an

order

we

are

with
cope." But
and

to

this

means that
over-all gains in
productivity attributable to auto¬

mation

will

tionary

proportions.

ual

forms,

be

not

tries, it will be, of
for the economy
There

of

revolu¬

For

individ¬
indus¬

individual

and

but not
whole.

course,

as

a

is another kind

vation which

we

of

inno¬

should take note

of, which is quite different from
inventing
new
machines,
new
processes, or new

products. It

con¬

cerns

the discovery

and develop¬

ment

of

of

and

directing

new

ways

done as I did, moved to the sub¬
urbs, thinking to escape them. But
we
cannot, for not only do similar

problems

combining

resources,
both
industry and for the econ¬
as a whole.
For the lack of

GROUP

CHAIRMEN

our

own

EASTERN

PENNSYLVANIA

SOUTHEASTERN

William F.Machold

Charles H. Pinkerton

SOUTHERN

com¬

munities, but the problems of the
city are still ours, and we neglect
them at

risk.

our own

one

One simple

If I may venture
prediction, it is that our
being in the economy of to¬

more

well

will

morrow

needs

and

the

assuage

of

fears

Here

at

I will mention
just two problem spots, although
there are many others. First—the
giant

home,

corporation.

tions

have

tively

These

institu¬

which is

power

unchecked

by

rela¬

hands

the

market

their

of

the

economic,

political,

social influence is
do

you

this?

and
and
How

enormous.

with

cope

owners,

Laissez-

faire won't do, and the anti-trust
laws, while useful, are not a suf¬

would

are

come

pend

Federal

help, or placement of
representatives
on
the

public
boards

the

incorporation

of

directors.

answer,

such

but

I

I

don't

do

know

concentrations

power

of

that

private

contrary to the funda¬

are

mental

know

economic

philosophy

of

and

our

political

country,

and

innovations will be required
to meet the problem.
•

some

,

Second, consider the

city.

It is

becoming

increasingly clear that
of today's problems cannot
satisfactorily handled within
geographical
boundaries
estab¬

being

and, upon there
sufficient number of other

a

In my judgment, the greatest
single key to American growth in
the

generations ago.

omy

expression, and,
mobility of our

the

ing

Are

this

ity?

of, c4merica

in

rity, and

who

Watts

&

Co.,

Co.,

Baltimore

G.

Furmati

Incorporated,
S. C.

Greenville,

Street.

(Special to The Financial Chronicle)

LOS
ers

securities

a

West

Sixth

Henrietta A.

are

Richard Haley,
Vice-President; Charles T. Kranzv
Treasurer; and Lionel D. DeSilva,

ANGELES, Calif.—TeachCorporation is enin

1125

at

Officers

| Raaf, 'President;

Securities

gaging

offices

from

Teachers Sees. Opens

business

Executive

Secretary.

innovator

a

danger of los¬

search

for

secu¬

the

innovator

He

the

to

in

the

He's

one

on

reading

usually

boy

the

or

HESS

or

McFAUL

&

INVESTMENT

SECURITIES

socialist

young

library

afternoons

the

be

may

league meetings,
sits

secu¬

not be "normal"

may

goes

Saturday
big

a

different.

who

American Bank

Bldg.

Portland 5, Oregon

book.
he's

And

always dissatisfied with the status
But

quo.

is

he

the

hope

the

of

Bell

Teletype—PD

254

future.
A

President

have

great deal

to

here

say

Specialists in Securities

economic

and

truism

a

that

of the

the

depends

numbers

on

fresh

on

traordinary

less

insights,

^nd

efforts,

i

con¬

Pacific Northwest

growth in quality of civil¬

than

.

a

Dr. Pusey wrote:

is

"It

Harvard,

tried

population

growth.

.

I

Nathan

by

of

summarize

to

what

about

.

statement

recent

ization

^

in

our

"adjusted."

tinued

Jp; FROM: {John W, ZJyler, Qeneral Atanager

we

Remember,

seems

Snvedtment (Banker3 c4d3n,

Baker,

action,
society

usually threatens someone's

of

***

Co.,

Philadelphia

rity, for uniformity, for normal¬

Pusey,

OHicer3 andM,ember3,

the

gave

chance.

Problems

1

'

Arthur C. McCall
Alexter

past has been the freedom of

thought,

traffic and air

transit, water supply, sewerage,
pollution cross city

willing to respect
their right to do so.

are

and encourage

be

of

.

&

innovators, people who

people who

many

lished

is that they do

Drexel

act; differently,

and

would

Innovators?

our

automatically. They de¬

upon

which

laws

prob¬

willing to dare to think and

are

ficient

Perhaps

for

similar

Have

stress here

even

answer,
and
sometimes
obstruct economic progress.

and

chances of getting
innovations?
The
point I

such

not

upon

anything else.

on

We

What

more

innovations

these

Will

Concentration

Power

depend

organizational
lems than

within

TO:

in

arise

meeting

merely

mech¬

IBA

of

Some of you may have

protect the investor and meet the

of

of

New

share

has in the past.

Also,

forces, their control is largely out

continuation

full

ingless.

institutional

Most experts say "no revolution,"
a

de¬

them.

its

mass destruction, all our other
plans and programs will be mean¬

of

Private

automation, by which
use
of machinery to
machinery, especially

there is

find

we

has

we seem

lesson that history tells us is that
the decline of the city will mean
the end of civilization; it always

'

the

control

level, it

handling

problems.

the countries to be developed.

of

mean

where

1

On the world

is clear that unless

organizational

for

which

areas

lines, and

vices

corporation,

some

state
new

even

need

to

government,

of

future,

and

past:

the

sembly line, the Federal Reserve
System.

new

a

conventional

in

power

to

to be

better name, I will call this or¬
ganizational innovation. Here are
a

10^

(2601)

UNDERWRITERS

DEALERS

DISTRIBUTORS

ex¬

novel

achievements by a few individuals
of exceptional
"It

is

the

one

HOTEL

AND

COUNTRY

tric

CLUB

might
person

ability.

.

.

.

exceptional

almost

INVESTMENT

person—

the

say

eccen¬

INVESTMENT

TRUSTS

MUNICIPAL

who

—

all

BV-THE

E

A

IN

FLORIDA

been

opening

fuller

Some of you were

good enough to tell

the

life for

Shaw Adds

wood—was your

finest

so

a
U.

us

Holly¬

far. Thanks.

tried to make it

us

a

to do

real

our

best.

It's

pleasure to have




1927

PORTLAND

BUILDING

BANK

OREGON

4,

8-1318

CA

Staff

to

(Special to The Financial Chronicle)

SAN
J.

MARINO,

Kemp

Shaw

&

Calif.—Donald

joined

has

Qo.,

the

2394

staff

of

Huntington

FOR "COMPLETE" SERVICE

With Henry Hartrmn

You inspire

always
here.

ON WESTERNS

(Special to The Financial Chronicle)

SHERMAN

you

BONDS

so.

But the credit is yours—not ours.
You're wonderful guests.

S.

us."

Drive.

Everyone of

&

me

that your 45th annual convention—

the tenth consecutive meeting in

toward

way

all of

STOCKS

BONDS

along has
SINCE

HOLLYWOOD-

SECURITIES

CORPORATE

•

Goodman

Hartman,

OAKS, Calif.—Paul

is

now

13531

with

Henry

If you

deal in Western securities, or would like to, we

complete service in trading, information

Ventura Blvd.

With

Joins Maisel Inv. Co.

our

home

office

in

maintain a

and executions.

Portland, branches in other N. W.

cities, and direct wire services to

42 cities of the U.

and Canada

(Special to The Financial Chronicle)
...

SAN

Cordially

yours,

FRANCISCO,

Sylvia

J.

Maisel

Investment

Market

Lawrie

is

Calif.
now

we

can

supply the information you need.

—

with

Company,

564

Street.

Zilka, Smither & Co., Inc.
INVESTMENT
Member San

With Carroll & Co.
General Manager

telephone

Colo.

—

Richard

8-8261

is

now

with

Carroll

Co., Denver Club Building.

TELETYPE

PORTLAND 5, OREGON

J.
salem

McMullen

Exchange

813 S. W. ALDER

CApitol

(Special to The Financial Chronicle)

DENVER,

SECURITIES

Francisco Stock

&

eugene

•

medford

•

PD

coos

155

bay

106

The Commercial and financial Chronicle

(2602)/

/
Continued

from

but

3

page

sion to the troubles of the world.
Wei have solid work to do to help
face

We

international,

and[

nomic

troubles.
challenges,

domestic

with

econ¬

an

whatever

situation

its

outlook

had

we

Hungarian refugees,In recognition
.abroad1, will" throw- thet^
expensive and in- of their valor and'as an act of balancedo the side of restraining.'
inflationary — a humanity and in this our 'privatethe boom, or even bringing on
complete economic waste,, but a citizens and insEfhfions should ^ome recession. But we cant be(
complete necessity.when brigands

and

and encouraged to grow—but has

beejn restrained

the making.

Let

wild.
go

this

For

in large

running

from

thanks

our

must

to the policy

measure

The

Middle

the

the world

of

eyes

and

East

are

The

System.
May it never lose its
independence!: May it never be¬

Housebroken,

come

White

the

House

whether
the

or

to

Houses

of
Congress — never in politics.
May it never be shackled into a
Ibck-step with other government

departments

so

that

all

go

may

hfarching off in what at one time
or another would surely
be the
wrong direction.

has

been

Praises Federal

been

the

stores
be

has

Reserve

principal defense against
•rampant inflation. It has held the
money supply within bounds and
cost

of

rise in

money

re¬

to demand.
It has sus¬
tained prosperity; it has not pre¬
vented growth.
Just take a look
sponse

the face of this great coun¬

across

try, listen to the hum of its fac¬
tories, ride its roads, fight its
traffic, line up at the counters of
its stores, watch its buildings rise,
and you will see the most active
America

that

and

you

American who has

I

ever

lived has

But if you

ever seen.

to

Soviet

of

there,

or

look at

any

in,

arms

said

are

panic—far

it.

Credit is available to worthy bor¬

buy

to,

rowers

anything,

and

with

almost

interest

at

\ythich, even after
are

build

or

possible

costs

a sharp rise,
minor excep¬

the

not

Kxemlin_

though

as

before.

had

we

that

And

whole

this

over

complex

of

troubled

hangs

events

the

or

without

Soviet
and

the

mask

ambitions

of

smile,

a

unrelenting

are

world-wide.

With

We

cannot

be

sure

when

the

Kremlin

masters

will

move,

nor

where.

But

know

we

jthey covet the Middle East

*

Canal.

Suez

should
could

the

much

Soviet

Keep

U.

S.

S.

sends

R.

\

ought

we

tions
if

United

such

Nations

as

international affairs, it must have

stake

here

is

commodity

area.

than

more

oil

as

convenience.

or

At
a

At

stake is the question whether our

And

.

'

in

all

^

?

policies

- our

and

that

monetary

ip

matters,

know'snvhat the effect,

their

monetary effects

to pre-

or

itary power at unrivaled strengths!
and pay as we go.; No time for?
play, and very little for politics! :-l
*; "

,■

—

—

Continued

from/page 6

BusinessSitnaiion^nd Outlook

-

v"

equipment
high
and

np$>at extremely

are

upsui^fnable

in

The
self

United

Nations

powerful

when

proved itled by the

nations

force

moral

of

which

heed

the

public opinion

itself

oowerful

United States

It*

ledTand

nroved

it

when

the

fought for
Communist aggression.

against

in Korea.

But the United Nations

helpless
and
futile
when
closed the Suez Canal to
Israel.
And it is helpless now in
was

Egypt

against

Soviet's barbarous

cannot abdicate to the United Na-

vital

nilf

form of intention surveys are not
levels, yet available, and the argument.
dealing with our enemies, just New orders in this sector have must rely on more general artaly-as
it
did
in
condemning
our begun to decline and are now besis. ,My own estimate of under—
allies.
low the
level of current sales, lying demand is that the presint'
the benefit of our firm convictions

into

but

and

us

arbiterln

sole

war

soft

of

none

action^ Jor

^

to place ourdrust ,m the

off, quickly and
convincingly, the Communist tide
very likely will run into or seep
this

in

worfe artfund

to

condemn
are

we

the face of the

warned

""J:

cost of it.
I think

ednptude

to

■''—■

France,

of

nnCBInIP

practices, we must keep lue andhealth in bur American system, in *
our
free enterprise system, and[,
0f these great artd^rave interna- defend • with
all
our
peaceful,
tional decisions and events will might, our currency and our vital *
be.
They will have their reflec- economy, while we keep our mil- V
business

than to say we. are
'
a b o

and

*

well

planes

Asia

Out

cmnr\tV>

nnH

others* drastically with our money or tne

hone

win do

js

neaping,
,
restraint, keeping J
things from day to. day-as even,
as 'possible, to our,
economy, without tampering too.

more

United States against England and

of

I

likewise.:^ "
Finally, here ^ftbme,

con-

on
here all righh/but it is too
don t early "to diagoos&'^ith certainty

J

.Soviet

she

Middle East
Unless

Nasser
the

prize,

that

capture
control

If

World,

i

.

issues that

loaders

our

•

.

the clock to have the United Na¬

with its fabulous oil fields and its
vital

and

"concerned"

least,

Western

~

have done this with the

and

arms

die in order to live.

shadow of Soviet intentions.

involvement

When

must do

willing to

seems

and* Nasser

without

whole

we

know.

Hungary—poor

Hungary—is the scene of mass
murder, but also of a cry for
freedom

the

only to

"

an.opinionSapon* aTTeasT ^smooth

of the grave

front'

aod' ^on
ga°„'d eration an*,

sejUour- sails

rset^Kwish

to the

Kremlin,

go

almost

your

from

can

Maybe

ing created in the capital markets

money

which

to

fire and damnation in a voice that

hasn't been choked off but is be¬

no

clear

East

with

sounds

v
t

SOme

as a nation, we should
position about the Mid-

our

stirs the Arab world and breathes

it

iori

Mfeariwhile.. and'' until we- are.
hot^for Wer. of what is ahead, we should;
_our gov- stand fast by our policy of modK

thlire

but

Kremlin, to
Nasser, to our allies, and to the
world, I mean by .this: we should
define the points or areas beyond

Nasser

Africa. She could bleed pale Eu¬
price tags, your budgets, and your
rope's economic vitality, outflank
costs, and if you'll study the debt
the forces of NATO, and, I fear,
figures, you will see that prices
be
on
her
way
to becoming a
have been rising—some of them
stronger world power than the
rather
sharply through all re¬
United States.
straints—and you'll see that credit

and in the commercial banks, bil¬
lions upon billions.
No, there is

die

great

named

man

a

horror,

to prevent it.

Second,
make

volunteers have

move

Reserve

Federal

our

let the

Chinese

and

threatened

''

^a'n

Mghtottd Jtoout war

unthinkable

enough

least,
blood has

there,

i

d

'

V

spilled, pipe lines have been

sian

its

and £?■ Th

and will pay.

can

h(J0?

limit to.

no

people

.

.'

.

Reconim«,lds Restraint at Home:

submit

cut, little oil is moving out, Rus¬

heard

No,

flared

American

be

u,

with

on

tion for months at the very
war

the

their institutions

of opera¬

is out

Canal

safety, there is

our

what

Hungary.

on

and actions of the Federal Reserve

Suez

and

partfclpat^genfef^tijfy;- '

praisal of our whole situation in
the light of the grave political and
economic
decisions that are. in

that is vital and active and
far generally sound. This is

tru£ because it has been permitted

is

*

be° sure°Sf: fo^our^dlfense

can

omy

.

better be armed good and

It
convenient

affairs requires

so

-\i

.

,

-Pfofrram for IT. S. A.

proper'?

worsening of international
a complete reap¬

sharp

r

vresponse-should be quicker and should
let me say what I sup- sharper—a real "fcrksh*' program, guess—-that the gravity -<of '
"crash"'
guess—that
the/j
really beyond controversy.' '.sixth, we should! eive still fUr- issues: involved,^and- thew reper¬
pose is
controversy,
'.sixth, we should! give still fur- issues involved, ^and- the^
In the present state of the world,
cussions here of economic difif-r
ther
haven
and .relief. ; to
the cassions here of economic _____ .

is, and whatever
have been, tne

may

■

At the moment, T,guess—and it is "only a*

f(>rth the MarshalJ}P.lan and our. deflationary.

']*.

:

present eco¬

our

*

...

„

First,
t,

Reappraising Our Entire Situation
But

■

strength and- to our mutual de- scribe the
monetary medicine.,
fenses.
The ..urgency
is
even, Theseeffects will undoubtedlykb'
greaterJ than • that which called mixed—- some inflationary, some

na-

v.v

Thursday, December 13,1956

.

,

entire

our

tional welfare, and our very freedom itself?
'' ^

Looking at Out Domestic Economy
And International Repercussions
to cute those

security,

our

.

.

the

Hungarians

both

cases

it

bowed

who

heed

no

moral

tions.

There should

ican

doctrine

East,

as

be

for

there

to

an

the

is

]n

despots

force

We

Amer-

Middle

Finailly, the very tight monetary level* of capital formation is high,
an<^ financial situation which now but there is no evidence that it
will. hasten^,the cut-back is too^high. Expecte,cl .changes! in
the level of capital oxpendi- population
and m .* population*
tUres. The . financial argument structure continue to. indicate a»
Soes as follows: ;F|iiancial strin- very large need for new and im- ;
gency in the pastjyear has al- proved capacity. Our prodigious;
ready reduced corporate liquidity expansion of productive capacity ,
to its limits. ItTias also driven is being met by an equally pro-:
interest rates to much higher digious expansion in bur capacity;
levels. These rates not only make to consume. In addition there are;it more expensive-to borrow; they two: factors which continue _ to,
a*so t€nc*
ra'se the minimum create new demands for capacity.
earnings rate by which the ac- One is the rising backlog of techceptability of new capital projects nological >research and. develop-;
judged.
These- factors will ment which have not vet been;
force companies 4o eliminate a translated into operating capacity.;
number of projects previously re- The other factor is the tremqn-;
gfircled as worthwhile.
'
dous pressure of Russian compo—,
are

.

My

American

an

is

view

own

that

neither

tition and its economic and mill-.

allies, the free nations of Western doctrine for Greece and Turkey line of argument goes "far enough
.implications.
■
tions the lowest in the free world.
and as there is an American doc- into the total situation that now
The very purpose of the restraint Europe, our co-defenders against
Outlay Too High?
Communist aggression, are to be trine for Formosa, Quemoy and prevails.
It is- true that money
m
pplicy is to prevent such un¬ allowed
to exist in freedom and Matsu.
*
is Ught, in the sense that abun» » ?ls° 1?eeef?®ry tofreT^'
healthy developments as sharp
strength or whether they are to
Third
lend our imdint demand relative to supply *?er
5 dollar figures .or gr_
Aiiira, we should iena our
snouia
im
price rises, cost spirals and ex¬
have
tn
thp
domestic investment appear dethe
economic
life
choked mediate aid to
the United Nations
cesses of debt
These harbingers
out of them by a Soviet strangle
High. These figures m-!
in
unplugging the Suez Canal, nignest level since
But in,
of danger have made an appear¬
J substantial amount of
hold on the Middle East and the
We should offer our engineering an absolute sense, the volume of.:clu
wt
..
a f
,
a \ v ' r
snouia
oner
engineering
ance on the scene of our great
nvailahlp
ffrhds
is
lanxe
spending for replacement. Exac^Suez Canal.
brains and our massive salvaging total
forward progress and, though still
available funds is large ^ti
ti=
{
not
D0SSibie
but
Involved in this are the very gear
And
to
eet the
ioh
done
esumauon is noi po-sioxe, u
not too bold, they could suggest
gear.
/\na,
10
get
tne
jod
aone. enough to sustain the present rate
foundations of the NATO military
„^itl f
tinn,
nn„;hiv
certainly not more than one-half
that the restraints may have been
quickly, we should, by guarantee 01 capital formation and possmiy
-

»

.

T+

u

■

.

£as dn^ven, nter^t r^es to the-

too

little, not too much—too late,

not too early.
Before

some

the

international
so

diffi¬

acute there

was

feeling which I shared—that

number of forces

toward

have

which

built

the cost of

culties became
a

defenses

were

working

the

in
so

we

and

Western

our

allies

Europe at

much toil and treas¬

They could not be main¬
tained in effective strength if free

OX
or

It

otherwise underwrite the cost
wise, underwrite tne cost.
oinex

would

be

investment

the

we

best

foreign aid

internal

Europe
were
permanently
de¬
prived of Middle East oil and its

Fourth,

should

we

"speaking

terms"

France.

and

We

get back

with
must

on

England
save

our

creased

where

growth

had

fyecome too hasty gave some evi¬
dence of curbing their pace. Some
capital expansion plans were be¬
ing given a second look and. a
third

look.

prices
in

some

pthers.

higher

and

in

to

dip

their

in

earlier

or more weeks ago,

international

having

cases

Even

stages, six

uncertainties

the

were

unsettling effect on
optimism. I rather felt

some

business
that

to

iyas
starting
to
show.
margins had begun to level

Profit

off

Resistance

sometime

reasonably soon,
perhaps during the coming year,
these
less

factors

would

sharpness

climb, perhaps

in

bring
our,

upward

short-range

spme

downturn from which

about

a

loh^-term

upward movement could begin.




ebb

of

out

Western

Europe and
finally to stand alone, outnum¬
bered, and likely to be oUtpow-

Weern^H

has

them

and

w.

one?

"

soendihe

rurrent

creatine

is

current spenaing is c

net new capacity.
figures

also

a

The enormous

reflect sharply

the consequences
happen in the Mid¬

of

Fifth,

we

But

broader

and

what may
dle East could be disastrous.

can

fumis has

continue to pro-

Aid

should

aZt1 $"bUlioS7fundsCtoUthe
,

mnnfhs>is*

,

enine

to

he

loS in'vmT^ Thi^wiU
more

funife,

for capital ex-

<?-»■-

npnfijtt.rps

bolder

new -

*

-

v..,

our

even

aid

pro-

But

capifc formation"

incomplete

an

funds

make

tion

spending,

for an^examp

.

an

also

Allies

to

Jal goods sector Take construe-

increasip^ total volume In the seven years ending 19a
financing. What is more, the ^,.w
invested over $ 5
„rowth in fnven4^rv
which used
billion
in
construction of all

vide

'iSta 'JinV
need to win new hJb|t■

Extend

At their worst,

o! e"teriS

.

-Eltaliy, Jhe'ai^unent that the
^ of the tote^sst rate will in-

mm

'

ered.

use

provided and

Sure 1nbfeVnnt ttol'vmare mulh
^allow

Areas

of

.

.

ure.

alliances.
squeezing out of the Suez
They are mainstays of
artery.
Disagreeable
and
our defense
more
unhealthy aspects in our
defense, thn fiondaafoe hnid
the floodgates holddisturbing as it may be for us to
economy and the establishment of
face, our choice is either to say,
a
more
sustainable., pace. These*
However unwise or impetuous our
"No, all the power, energy and
forces
included
the
money- life that the
Middle East repre¬
restraint
policy, the effects of sents shall not
go to the Soviet nn rn.r
which -are gradual but cumula¬
on our side and we have common
side," or to watch the strength'
tive.

.

funds

1 he use of internal funds has
put
a Ugh

.

made.

ever

thi5 rate.

an increase.-in

are

the

more

is

Debt

one.

^kpensive today.

o&r equity

capital,
however this is measured, is now
cost

This is more thamwe to-

types

vested in the preceding 27 years..

« we adjust for the price factor however, construction volumein

the

pa^t seven years is

only.

o?e-half of that to the preceding;
~
tf we further adjust tor our,
largerpopulation,
taraer population, in the last
construction
volume
per
capita
is
somewhat
less!
corresponding volume;
in the seven years from 1923-;

seven

than
was

years

the
_.

..

...

.

r

+u

Finally, adjustment for the
ship- War II.
Assummg there is no higher standards now prevailing,
conceivable results in the short¬ ment
program,
which
was
andrastic fall in stpek prices, these anc* *?r the _act that more conest conceivable time, we
already nounced a few days ago, working funds will continue to be avail- - struction is now needed loi re¬
know that the Western World is to al its
physical maximum, it seems able in 1956 at liiw cost and in placement purposes would change
undergo a mighty wrench.
We clear that Western Europe faces greater
quantities than at any the comparison even^ more, and. it.
can't know, of course, where be¬ for some
time
to
come
an
oil time since the lati 1920's.
*s no ■ longer so obvious that we
at

even

the

the

highest

tween

hopes

worst

outcome
will

best—even

fall.

and

for

best

of "these

fulfilling
the best

the

critical

Certainly,

final
times

of

gram

for

Europe.

our

Even

allies

with

in

the

Western

its

at

lowest

lei^el

since

shortage of 20 to 25%, and a consequent cutback in industrial ac-

On
of

balance, the-financing side
picture does not support
that capital expendi-

the

the

steps,
therefore, governmental and pri¬
vate, are called for in order to

five

levels.

ways-to

aspect of

demand

safeguard

cushion this blow—a blow to their

Concrete

clues

United
them

States

to

their

not

must

best.

only

try

to

the,

bring

What

our

economy

million

blow!

In

allies,

we

people.

consultation

should

seek

1929.

oil

tivity of about 15%, carrying with
it unemployment to some four or

we

World

A

heavy

with

our

thesis

tures

must

What

decline

from

present

about

non-financial

the

in this sector?

for

1957

in

the

bave been purchasing construcllon a* unsustainable levels,
In fact, throughout the postwar
boom in business capital spend.n^
construction component
has

lagged

the equipment

corn-

ponent. This factor, plus the trend,
in new contracts for business con-

Volume 184 "Number 5594

.

:»The Commercial and, Financial Chronicle
1 (

,

'*•

**

"*

j-

'

'W""M

♦-

-

■*

*«■

'v

'

*

•'

%
*•

.

v

..

'

;*

t

.

*

.

'

*

>'

'

u
.

' *

i

-

41

'

indicates a continuing-pose
increase, in hon-jresidehtiai ] co*»-

but.

it vwould

inflationary und

be), just

.

'

as'-1957, there is

no

;.

ally sparked by

high activity

very

slowdown ip this gepwth. \T
in one or two sectors accompanied
struction in 1957; •'"Futhermore, cumstances. In
addition, it y^buld v AThe total outlook adds
up to a
by continued shortage of demand
developments we are no\v wit-_;/involve a breach in our
system pf gross products of about $433 bil- M other sectors. Price rises then
nessing In ; the machinery, " and allocating men and m a t e r
ia l 3 rlion by the third quarter of 1957 begih-even before full employequipment; sector will themselves through the free
play qfTmarke^jwith a corresponding rise in per- moot conditions are achieved. As
%nAt'
*--41

J

r-

4~

e

in

"

,

"

-

~

'

-

—'

-

-

i

—~

en,

these price yises can

other'sectors, without
^

purchases

fall

off,

rise,

I

- v,

,

_

T

.

,

development of ".excess deSince the entire apparatus of monetary. control operates

.

v

business

total

investment spending is likely

w

housing'through the^'use-"of suchducome.'Measures' m«I1d.
special

to,

.?>T. K v; 'only

devices

on

haye

.

been

tried .to

increaso farm

very limited scale ' and
not 1 ikely tQachieve

a

income

are

now

which

be

-

---*

*2

I

•

to expect

reason

107.

Apt

■

f

•

struction,

(2603)

.

*

t

demonstrated.

demand

excess

Hie

cannot

p»th^t'\v.ay

would be to lace the fact that we;
cannot
achieve
full- economic
growth aiUJ hjgh levels of active

ity without

in

the

magnitude
1952.

general secular

a

price

Even

j^ise

level

of about the
have had sirtce late.

we

during this period of

near-perfect

monetary andT fiscal,,
management, and in spite of one
mild downturn in aggregate activity and many downturns in seg-

meeting -witty - some success and .through its influence on demand,
this, sector; should .strengthen./there.':is no precise level of action
turnaround.; in ;?housing vsferts-.Simirar
melief to ^all business itbat can possibly produce both the ments of activity, the price level
Let us turn now to the
tctalj A more effective.^ and more desirrV has-been
widely suggestedi and ifa. right level of demand and a per- has risen about 1% per annum,
level Dl demand which.can be ex-able,".'move would be to. change is^ likely,that tbis will be achieved fefcUy stable price level.
'*
Excluding the farm sector, the rise
pegted from all segments in "the .'the EH A and
WV*?y; rates jsothatsoon through tax reduction in the
1 am not suggesting that these has been even greater*; v.
economy., in/ 1957.»
Expectations they are once more in-line-with ' under
$25,000 ;c o r p o r a t e tax observations should lead us to ' >
for the third quarter of
Llfl.
_
*
19,57,are the -rest of the mojiey market. bracket. Both
..factors will tend to abandon our newly achieved re$500 Billion UNF py 196Q
nntna
in/>nnnon

*v

as-such

:

4fte Uutlook for 4957.

:

.

are

*

a

.

_

-

n

4-V.„

Unh^p

j

„„„

ffpnprai

mi

printtni

hv

tvipop

on

observations

have

fpr

consequences

Federal

Expenditures

and

Foreign Purchases. These
ments

of

demand

lumped'together

the

."V?\"

.ten.]

;

fr

vv

Y

-

'Y Monetary Policy- ■>

-

•.

the

•

eleY^/Y':1^:v.-|V->:i-■-No".analysis

been ^Consumer

have,

in

Net

two

because

it is not possible at this
time to predict the exact
way in
which an increased flow of
goods

Durables to Offset New

^ :

forecast

Ilpmes

;

matter

The small decline <in

.;

investment

in

This

consumer

homes

new

will

is

of

monetary

already

subject

and

>

policy,

controversy

Planning at all levels of
adminis-. economic
analysis.
Four
years

to

ago;

for

talked

example,

about

omy

by

rate

of

1965.

into

to control the kind of wage and
price practices that lie at the root
of price inflation during periods

much

.

At

account,

the

expected

our

and

taking the
inevitable, price rise

minimum,

way would be for the government

,

the President
$500 billion econ-

a

growth,

The solution lies elsewhere. One

is

probably be more than offset by likely
to
increase
rather
than
services to the rest of the
increased demand for d li r a b l e diminish in the near
future. Many
world will be financed.
However, goo^s, especially autos,5 The prln- basic issues of
significance are
there is little doubt that tins
f'ovv; final factor at3;work here is the'involved, particularly during
perhust
increase in
1957. /Federal r^afion;-between extensions" and riods
such as we are now having
expenditures at home have also
repayments of^ instalment .'loans.
-neriods ;of high level activity
been
increasing, and will possibly
the third o.uarter of 1954, exten-- within which there are continuous
increase even more than has
al-;sions and repayments are roughlv readjustments of demand and
and

Reserve

controls

on; the;'grounds
that it cannot do; a perfect job
would simply ensure that an even
less perfect job would be done,

controversial

a

the

Federal

trative

.:of -1959 an<i 1957 is
complete without some attention to

iin¬

long-

I

would

surprised

threshold

if

we

of

bq

are

very
not at

$500

a

by next election day.

economy

*

~

*,

.

n

sup-

ready been anticipated. There can -equal.
The introduction; of new ply
among sectors in the economy.
also be little doubt that state
ajird car models stimulated an
.increase; g. Monetary management has
Ibcal spending will continue
their-in the level of extension. At the
three tasks to fulfill. It must, enlong-term postwar rise. Together, s<ur»e tim^. loan
maturities were courage the
smooth
flow
of rethe expenditures
listed\:tpgeuier also lengthened. As the repay-,
sources
between' sectors in re_
under Group I in the table
should ment rate tended to
lag the ex^en-,^ sponse to
changing patterns of
iperease by at least $5 billiov ,; sion rate,-the-rate .of.-net'
extent-demand-. I put this first because it
Consumer Investment.. A decline sions
grew,'By .the. third-quarter is
frequently,; forgotten' The sec_.
in this sector was the
prime source of 1955, these net extensions were
0nd
task
is
of weakness a
to-.encourage longyear ago. A similar
running at about a $6 billion rate,; term
growth and to prevent overdecline in 1957 is not evident to- and one result was a
record vola]] declines from developing. The
day and
thnre
is a • very good uwe of
consumer
durable sales.?, third task
is to prevent a general
chance of a-rise.,,
T'Vv.';"Although gross extensions re- price rise. :
v
f /Residential construction will mained at the mew ;high
level, ;* jn theory, there is some
precise
probably continue to fall.
New the repayment rate continued
to level of
monetary ease or strinstarts are now about 10% below
increase. By. the third
quarter of gency which will serve all three
the average rate for the
first nine 1956,r net
extensions were-once aims'
perfectly; In practice, it is
prionths of 1956, and
considerably again down to nearly zero. At this
becoming
increasingly
apparent
below the;peak rate of 1.400,000 point, demand in the new
car.
that there is no
single level of
registered in early 1955. The fall
market, as well 2as in other durmonetary ease or stringency
ip unit starts has been offset in able
markets* Js.,once again being which will achieve all
three ol'
part and will continue to be offset subjected to
the.-stimulus of new these aims
perfectly within the
by the increased size and costs and better
products.
Under the kind of
economic and institutional
6f unit«:
being built. Thus dollar; circumstances,-ft is
highly likely environment we now have in the
expenditures are still at higher that
gross extensions will again
United States.
levels than
we have ever had, show a rise. The repayment rate
;J The
arguments which underlie
except in 1955;
will
lag. and/the effect of net
this judgment arc as follows:
; Clearly a good part of the de- ^oit will again swell the volume
The various sectors of the
.

econ-

gline in this1, sector is

|ncreased

of consumer dupable purchases,

of

result

a

c o m p e t i t i o

in the

n

velopments." Business

been

pressing

et

farm

of

Under

r

control,
is

of-lohn

as

Thp

of

" of

a

is

d'-sir^bi<\

.

doing

business

and

men

materials

and

Poth

con-truction.

not

in

a

corre-

prod net

s^igs.

and
the
tight
situation suggest that furinventorv accumulation can-

be

ture.

expected in
On.

the;

the

fu-

near

omy

and

have

.

not

down

in

been

moving

unison

broad/sense of the term.
we

have had

a

Instead,

complex of opposconflicting shifts in de-

ing and
mand.

un

in

even

a

This is all to the good,

it makes over-all monetary

but

man-

agement

extremely difficult. The
amount of credit (even if it could
be precisely determined) which is
just "right" for keeping the economy

as

level

can

a

whole
lead to

at

desirable

a

excess

a

minimal

r^te,'can be

expected

to bring the inventory-sales ratios

get built into

/

.

down to year-ago levels

mgans

the relative position

pny

need

for

'of

iv/iPri_.

our

..

general..inventory

„

_

Because of. institutional prac-

resi^entml -construction iu-tWs Vaiv^tjon. In; short, inventory tices and attitudes, price declines
wouldIt
sirooly inrreasa t^e
pooui^tions cannot be expected to in the not-so-prosperous sectf'rs
ci d
«
provide'the extra demand they dtfinot tate
withini the industry and thus
piace^readi y t° offset
lead->»ye b°"n orovid.ne this ve«r
.the effect of rising priees n the

total.

.

amount of cornnef't.ce b

i

i

n

&t0anadn^sThaanewer,ha;ne
already had.
,
-

Pueeestions

have

».

r«.

also

•

to high production rates

been

Sales

to

have

tional

the face of

.cheapening

ly mnlv.

of

credit

the

to

d'-

residential

sectpr. This could achieve its

pur-

the

continued
a

uncertainties
sence

of

next year.

consumer

to

grow

*ctor
i11

even

19nfi.

in

similar

In

the

ab-.

uncertainties

,

.

demand

"von

°*er

1

relative

to'

thatHsing pricesinthc expend ing sectors are not only not offset
by declining prices in the sectors

Jl

KjIIIkC

office

T

1Q._

1

on Nov. 21,

,

1955.

.

W

1

KjIIIhAVC
f*.§f1®

Slltfl

,r

t

Citizens board of directors dCclin-

Mr. Deane joined The Bank of
Virginia on'Aug. 3, 1953,'as Assistant
to
the
President.
Mr.
Campbell joined the bank's staff
in Norfolk, July 1, 1952 and was
Mr.

Dec.

uasmer

nowsiam

1954.

Gills entered The

10,

ing
the
new
merger
proposal
stated that in the opinion of
th^
board the proposal would not be
in'the

Mr.

Whitt
began
his
banking
with The Bank of Virginia
in April, 1937, and was made Ascareer

sistant Cashier in July, 1948.
As

of

Nov.

National

Minn.,

the

of.

reported

y

f.

C.

the
0f

Midland

Minneapolis,

$100

shares,

par

each.
*

*

forrnation

*

of

a

bank

new

Lake Worth, Fia., is announced

g

Comptroller

The

name

ant

Worth> with

surplus

capital of $350,000
$150,000.
H. G.

a

of

Baur heads ^ primary organiza^

President

gg

whUe
33

o.

G.

^

The issuance of $100,000 of

President
National

of

Bank

number

a

of assist-

for Oregon's statebanking system. Manager of

managers

the

bank's

liam

Eastport

new

Plaza

W. Taylor was named to the

staff of the

new

by the First National Bank
of Lafayette, La., has increased
the capital
of
the
bank
from

$500,000 to $600,000 effective Nov.
29. The new stock consists of
60,000 shares, par value $10 per
share.

branch

new

as

Assist-

new Assistant
Managers and their branches are:

Manager. Other

Frank

L.

Chambers,
Peninsula
Portland; Harold IL
Searcey, Athena; Shirrel R. Doty,
Medford;
Carroll
D.
Ashbaugh;
in

Corvallis;

gold,

Theodore

and

A.

Ber-

Grants Pass,
*

been

of the

Commerce National Bank in Lake
,and

.

States

and

manager

wire

the

of

bank, has

chartered u*der the

Eanfc

has announced
appointment of a new branch

branch

The

Citizens

Portland, Ore.,

the

consisting

a

20,000

*

Sammons,

United

ant

of

of

Savings

its shoreholders."

or

capital of $2,000,000, enlarged from $1,000,000
by a stock dividend of $1,000,000,
value

&

branch, which opened in Portland
on Dec.
15, is J. Allan Gard. Wil-

*

27

Bank

interests

Trust

Bank

in Roanoke in March,
1949, and was elected an Assistant
Cashier Dec. 5, 1952. Mr. Smith
was elected Assistant Cashier of
the Bank of Virginia in June 1951.

*

best

National

of Virginia
.

stock

/"nnh' This movement
f/ag„aVated bTthe lad

in

GROSS

NATIONAL PROnrCT
SEASONALLY ADJUSTED ANNUAL RATES

cWupwaJd

vlfJer-al?

number of eeonomic

'

-

J»«

VI

■

^ ^

ynade for-some special, non-trad.rec

,

Currency.'

'
.

^

^

Ml

3nnni]np(imp.:
Pr?sident on Jan. 1, 1947 and be- To quote from the announcement
came officer in charge of the of the Citizens;
bank
Roanoke on Sent. 1, 1948. « "This is the second merger prgHe was elected 'Senior Vice-Pres- posal received by Citizens fltpfn
ident on Oct. 7, 1955. ,Mr. Orgain First Western within 14 months,
was elected Assistant Cashier of The first proposal dated Aug. 15,
the ba.nk Jan- 11, 1946, and Assist- 1955, was on the basis of one ah4
an* Vice-President Dec. 12, 1949. one-half shares of First Western
9n Jan> 17' 1950' he became As_ stock for one share of Citizens
sist#nt Manager of the Fourth stock. The first offer was declined
arid Grace Streets office and was by Citizens board of directors o»
named officer in charge of that Sept. 15, 1955. The resolution o|

price system,

stickiness

in

A KAHi

demand

other,

hand, the in specific sectors and to price
fU. expected: growth in
sales,, even at .rises m these sectors. These risgs

Creating easier

credit through traditional
will not alter

rise

by

prudp^ce

ther

nancing is going into noH-residen-r
tial

This.rise has not

matched

monev

a

and

of

.

of September were at
level of $86V> billion—

year ago.

fully

snonding

psirig a record volume of ;financing. However, a greater proDo*-tion
of

a

been

.

shortage

is

end

Deinventories

rise of $6Vi billion in book value

from

constriction

whole

a

record/volume

the

credit, .the record

relief

absolute

no,

the

system

such

ror

funds.

Industry

in

mortgage

feasible

There

relief

present

our

jno'petary
neither

for

easier

.

Consumption and Inventory

r

money markets. Some circles have

4

|*

.

.

j

jMAlAfC

•

_

+•

S^QUtinuea JTQWl page lif

The

head

*

*

board

Canadian

of

*

directors

Bank

of

the

of

Commerce

Toronto, 'have

office,

de-

dared

a
dividend at the rate of
cents'per paid share in Cana-

35

dian

funds

the

on

outstanding

capital stock of the bank for the

STSMS
declared at the rate of 20 cents
per

paid share in Canadian funds

the outstanding capital sto<%
of the bank. Both dividends are
on

payable

the

at

bank

its

and

branches on Feb. 1, 1957 to shareholders of record Dec. 31, 1956.

.

.

(Billions of Dollars)
'

'

irri Onartpr

19S4
Actual

(1)

Government

and

1956

1957

Estim.

Forecast

local

investment

(3) Consumer

investment

Sector—Total.

Wi
'«.«

48:t

sis

25.0

purchases

'

-««

300

33.1

35.5

751

and

Total
Business

'

hfn„lrl„

47.1

Sub-total

(2)

1955

Actuals

irrt Oi.artor

Foreign. Sector—

SahnSnSttSs— "* ***■
State

irri Ouarfpc

76.6

82.0

87.0

36.9

'

41.4

If!

47.6

49.0

Sector-

with shrinking demand; they actually cause price rises in all sec-

*
'
Announcement nas neen maae
tors. This is a result of a number >by the Citizens National Trust &
of institutional practices with reSavings Bank of Los Angeles that
spect to price and wage policies on Nov. 20 the directors of the

such as cost-of-living wage increments, cost-plus pricing policies,
long-term wage bargaining, and
'

farm price supports. An additiona\ fact cf importance is that, in
order

duS'

".

|*;J

:

(5)

Consumer

inventory

(6) Total

Non-durables

&

Services.....

Accumulation

Gross

National

Uj

43.6

Total
(4)

54.4-

208.5
—4.4

Product




$359.5

220.3

3.6//?
$396.5

"

] 1;J

5f

48 4

5i.o

234.0

,,
-

246.0

2.0

$414.0

....

$433.0

to

reverse

a

general down-

turn in business, when this
/the

monetary

create

in

the

covery

a

situation

money

occurs,

authorities
of

must

genuine

market.

When

does take place, it is

ease
re-

usu-

Joins Frank N. Warren

.

.

bank had declined

a new pro20, 1956, made
by First Western Bank and trust
Company, of San Francisc», for a
statutory merger of Citizens into
First Western under the name of
Citizens First Western Bank. The

posal dated Sept

proposal,

basis

of

it
one

is

stated,

and

was

on

a

three-quarters

shares of First Western stock for
each full

share

of Citizens

stock,

(SPeciai to the financial chronicle)

EMPORIA, Kans.
Ciueston
pranj.

j

has

at

i0ine<i

Warren

Mr.

Donald L„

the
&

of

staff

Company

National

citizens

Building.

—

Bank

Clueston

formerlv wjth Reinholdt

was

& Gard-

,

Demosev-Tegeier

William R

&

Co.

Fullerton

WUIHWl D. ruUenon

William

B.

Fullerton,

of the New York Stock

passed away
brief-illness.

Nov.

member

Exchang^,

27tn

alter

1

i

However,
climbed

issues net of retire-

new

or»tprnric£»r«?
enterprisers' pvnpftaexpecta
the future are good.
Business men are optimistic about
what lies ahead and some expect a
30% increase in volume within
the
next 10 years.. Under .such
eircumstances,
especially
when
.lunon

that

•dence

about

tions

actu¬

charges

interest

in

1%

of

riod

to

meet

the

and
When

turn

we

find

that

credit,

for

individual demand

despite

efforts

some

in

amounted

to

of

June
over

which
in

had

construction, in terms
number of dwelling units built,

to

million in

1.3

from

is down

this

is not far from its last

ume

level

to

due

1.1

year's

months of
credit was
running about $5 billion ahead of
last year, with about two-thirds of
the increase taking tlio form
of
this

rities

further

Without

in

that
for

•demand

analysis,

the

it

aggregate

is
the

has not only
active, but it has
Com¬
ing at a time when the economy
is operating at near capacity, with
a
minimum
of
unemployment,
credit expansion would seem to
le
inflationary.
On
the
other
remained

money

very

increased in every category.

hand, one can argue that with (1)
a
growing
population,
(2)
an
ever-rising standard of living, (3)
a

continued

fense

horizons

major de¬

a

and

program,

dustrial

for

need

in¬
possible
are fac¬

(4)

new

made

by scientific progress, we

ing

volume

'

-

The

Since

Money

1951

the

of

part

effect of turning

the

Federal

into

debt

and, of course,

money

into

came

1955

the

circulation.- "The

followed

increased

by.; ^private

Federal Reserve

interest
As
are

rise

rate

interest

lenders.

did

of

The

lead

the

policy,

we

not

parade.

result

a

were

the rediscount

the

If the latter position be
then the economy requires

securities

coupon

credit to sustain that expansion

mar¬

for

but

Federal

bearing

below the current

rate

on money.
O11 Oct. 31, only
two out of 33 issues of marketable

par

Insufficient Savings

^

aggregate

«nd

investments

either

tion

savings

of

new

combination
rent

amount

"tight

must

from

or

money,

of

loans

of

come

the

crea¬

from

or

these.

from

The

cur¬

situation

money"

a

in¬

securities

above,

or

were

Funds to support an increase in

the

both

and

amount

sues

out

of

to

total

a

$2.4

only
of

$133

income, and the

new

ere-

this

money

year

have been insufficient to meet in¬
creased

funds

requests
for
loanable
for investment money.

and

And the

same

true in

was

1955.

mentioned
.been

earlier

available.

that

credit

What

has

has

hap¬
pened is that lending institutions
have drawn upon their

accumulated

previously
super-liquidity posi¬

tion. to meet the
•demand

over

excess

current

market

value

supply.

obtain

attractive

funds

to

lend

Aggregate

and

have done

at

It is significant

to




par,

was

only about 4!/2J%.

Some

what

of

Government

I.

to

as

fact
of

some
was

as

remember

following

20%
that

term

Victory
as

high

4Vi%.
notes

as

War

I

rate

Loan

as

on

issues

The shorter

actually

bore

4%%.

The demand for funds

World

with¬

despite

par,

coupon

Liberty
as

were

level

they went to

below
the

the

high

World

bonds

their

seek

support; and

much

the

here

us

happened

War

out

insurance

institutions

observe that

■

was

so

in

interest

rates

that

rates

of

governments

prices

been

I

loans.

lieve

of

GI

on

inclined

am

and

to

in

be¬

some

for the

reason

have

they

the

line

in

more

in

been

Certainly

I

eral
are

Further

circulation

drawal

money is
costs of every-

with

else.

doing likewise.

of

time.

long

a

the

h-iH

1

era

o?

shoidd

ever!

in

keeD

the

the

'

think

of
in

this

about

you

your

and

1957,

will

no

what

A

credit

business

ac¬

tivity could be maintained merely
from the revolving of credit; ma¬
turing obligations supplying funds

the

have

We

duced

"tight

of

a

policy'

money
a

Sales

to enumerate

standpoint of

results.
or

Effects

1956

over

the

same

pc-

automobiles and automobile

accessories.

been

extent

that

,

v*

•

.

"

re¬
we

creased

appliance
sales increased by 7%.
Furniture

.

and

store

Apparel store sales increased by

the

other

increase
ness

ness

from

interest costs to

in

would

further

would

hold

that

the

is

ager
to

act

to

have

inflation.
for

the

key for

recognize

in

the

your

own

resulted

The

consumer

a

great

rela¬

and

just

happening recently.

coupon

drove

come

as

has

briefly

the

Results

as

of 45

days ago of the "tight money pol¬

icy."
(a) The government is paying a

did

in

only if construction is greatly cur¬
for

tailed

or

reason,

any

when

capacity for the production of

the

to the
unsold
inventories. These negative forces
has

goods

exercised

been
we

have large

this time to the extent that anxicty should develop: therefore,
tight money should not greatly

26 billion in

not

1956

day. We would hazard an
opinion that the first six months
of 1957 will see even greater ac¬

making public offerings and many
called

on

expansion

plant

peak.

will

Money

than now and prices
up a little.
Interest will
make
some
further ad¬
Business
confidence
is

tighter

be

will

be

likely
vances.

high and salesmen may be sure
they will have every opportunity
to
demonstrate their keen sales
and

acumen

reap

satisfying

re¬

sults.

So

let's

proceed

with

j

con¬

fidence.

.

Form Basic-Investors
Investors,

Inc.

has

been

formed with offices at 159 Nassau

Street, New York City, to engage
in a securities business.
Officers
are

Jay M: Marcus, President and

Reubin Marcus,

Treasurer;

Vice-

President; and Marris A. Marcus,
Secretary.

Form Nance Inv. Co.
Calif.—Nance
has
been
formed with offices at 417 South
Hill Street to engage in a secu¬
rities business.
Officers are Guy
ANGELES,

LOS

interest rates have de¬
corporations
from
have

its

Company

Investment

some

them

that

and

reach

(Special to The Financial Chronicle)

$82 billion in all three years.

terred

at the

every

stop

1955

High

of

rate of
the
standard of living is rising, and
research is opening new horizons
increasing

is

tion

1954

36 billion in

—

into balance.

money"

$20 billion

and be ready
business!

results

Unemployment cajn come

power.

expansion.

plant

Sales Man¬

Getting
back
to
my
subject
"Tight Money and Sales," let's re¬
view

"Tight

involvement in

Tight Money

.

.

same

World
War III and assuming no develop¬
ment of a wild speculative orgy,
I see no reason to suppose that
credit demand and supply will not
Barring

8%.

busi-

things bought by busi-

that

un-(
unemployment materially in-j
thus reducing purchasing:

creases

Basic

by 5%.

Gasoline sales increased by
li%...
are
meager compared with
All-over sales of every kind inincreased costs of materials creased by 4% over last year!

hazard the assertion that

can

.

We believe this will not come

til

will

Retail food store sales increased

have

"key

t

tivity

No

by 6%.
Eating and drinking places sales
increased by 6%.
General merchandise sales in¬

an

the

three million persons per year;

believe that

to

forces
such

to

they

Commodity sales are higher ex¬

Costs

gin to show convincing evidence
of having a depressing effect upon
the economy, the Federal Reserve
will take appropriate action.
In
the meantime, it seems that in¬
flationary

as

situation does be¬

reason

if the monetary

and

—

of our great econ-

omy.,

'^od *or *955.
cept

Rate

in

sales

to meet the demand for credit.
Interest

optimistic

team member"

"Tight money" has had little or
no
effect on
sal|es of consumer
goods as of the end of September,
as
evidenced by an increase in

fall

would

use

and

extent that

problem

it is well

Little

if so, interest rates
longer rise. This need not

high level of

the

y°ur sales

de-

and,

that

mean

off.

effect

and
interest.

more

has not done from

mand may stabilize the latter part
of

Managers have to be smart, keen

with¬

interest

more

From

Sales

money

Sight of Decline

No

currency.

paying

Manager,

should

plans for the months ahead!
supply

their

'

policy" has been most pro- do not seem to be in the offing at

lecting

are

ings and new money are created.
No one knows how long this will
all

more

Fortunately, Salesmen and Sales

out

are

their

same

a

continue—and

budget requirements.

lnccease m loans. Banks aie col-

expansion of credit degreater rate than sav¬

mand at

and are
safeguarding

in

careful

reduce sales within the immediate
f<• deposits have foreseeable future, essentially dy¬
Our
P°! '"creased in keeping with tip namic economy is The popula¬
and
sound.

how-

of
"tight money" condition arises

from

than 20% of theirincome.
Individuals

cautious

more

are

pay¬

more

disposable

nounced on Commercial banks,
Loans have increased $17 billion
since Jan. 1, 1955. Securities have
been sold to make this amount of

Fed

noHcv

mind

installment credit which

require

The great impact of "tight

(h)

money

primary1 taus^

that

They

and

the

had

much

^at

tears

the nnstvvar
We

the

the

reneafed

-

all.

of

fixed

ments for

practically freezing movement of

inflation,

anH

anvprnmpni

Pe«erve

have

units

due

was

12%

Only

all.

at

spending

selling below par, and sev¬
billion
municipal' securities

now

of

cost

debt

(g) There are approximately
$130 billion in government bonds

pos-

as

increase

-

Then we might ask-^when
policy contributed' to any great1 will, a business decline
begin?.4
extent to the rise in inventory.
No exact date can be anticipated.-

Normal

situation,

This

kept step with

debt, and it is encour¬
aging to note that more than onehalf of the family spending units
in America have no installment

partly to the rise in prices and 1
doubt whether the present money

you

weakness

was

strong.

were

personal

as com¬

over-building

1955.

there

and

others

Personal income

Some of the slump

interest rates

FHA

nothing alarming about what
developed. Interest rates to¬

see

ultimately

conceded

—

were started
last. In fact, 559,00.)

starting is evidently due to un¬

realistic

following

tive to supply, that money market

down

tions,

financing

started in 1956

were

/\.

vancing sections of our economy I
the declining
sec- ~

pared to 685,000 for the same pe¬

,

financial

the

at

.

objectively

as

■*'

,

counteracted

1955.

and

est discountfon any Federal issue

more

likewise.

other

Some

selling at almost 10%
A year ago, the larg-

were

below

$5 bil¬

was

Oct. 31.

on

bond

Life

rates.

companies

issues

In

example, have reduced their
holdings of government securities

of

Federal' bonds,

of

par

rates

an

to

below

of current

.other words, commercial banks, as

billion

cluding Treasury bills.

allowed

This does not contradict the fact

billion

marketable Federal securities, ex¬

l:ept up with demand. In other
words, the flow of money into
.savings institutions, the retention
of

units

prom¬

of

More

Are
.

these

carrying special lax
concessions, being subject to sur¬
tax only.
Together these two is¬

lion

business

of

comments

in¬

homes

Fewer

(e)

issues

notes, and certificates

tion

selling at

were

dicates clearly that supply has not

of

sible

gov¬

indus¬

yield

,and that is important
oales Manager.

to you as a

Rates

.

Money

trials and all credit issues
a

all

sales—as

Looking

:

this

seeing a depressed bond
just the market for

ernment

which

last

in

announced

raises that

as

only in automobiles and housing. '

this year than

others in dollar

I11

"tight money pol¬
icy" of the Federal Reserve Sys¬
tem came into being.
Under this
system, the Federal Reserve did
not take any currency out of cir¬
culation, they just declined to
further
augment
the
money
in

rates,

3956

of

.•*:

make the following in conclusion.
The ad¬

It is well to

All

wantl'woul/have beeTineWtable

1951.

in

for

sections is the main

policy

money

existence Jn

available

is

riod last year.

thing

term

expan¬

sion

could

dollar

billion

$13

against

which

.Sound

automobile

1956,

of

•

shall havd inflationary

we

tendencies.

automobiles.

more.

infla¬

was

publi#,

overselling

know that

is well to

It

July

as

day are more nearly normal than

support of government se¬

curities had

of

full

season

of

Interest

has
Sound

that

long as wages are raised
and passed on to the

rvals

we fare

stallment notes totaled $15 billion

Sales Managers know

in¬

Government

S.

believe

to

cause.

was

ket—not

years.

true,

Government

accounts.

several

period of economic

a

U.

for

led

Credit

near

ises to eclipse all

tionary.

installment credit.

clear

This

vestment

eight

consumer

year,

Federal

operating

Christmas

accomplished
through Federal Reserve policy
and
through purchases of secu¬

higher costs and to
bigger houses.

first

the

the

not

the construction of

For

we

a

securities.

but dollar vol¬

year;

uses,

money"; however,

so

capacity
Even
and
is
setting new records in falling off of new homes.
many
of its segments this year. so, one million houses a year is
Employment
is
at
an
all-time good.
(f)
Business
inventories are
high. Personal disposable income
is
the
greatest in our history. larger than last year. At the end
Sales in most lines have surpassed of July, 1956, there were $85 bil¬
anything we have ever seen. The lion as against $79 billion in July

supported the market for its own

1955

annual rate of less than

an

million

other

for

would have ex¬
"tight money" con¬
dition in the early postwar period

residential
of

is

ary pressures.

of the market in 1955 is the major

It is difficult to prove convinc¬
ingly
that
"tight
money"
has
caused any serious trouble to date
in the nation's economy. Business

assuredly

perienced

$12 billion more than
of 1955.
It is true that

was

June

funds

most

billion,

$94

,

Korean

began to sell their governments to
obtain

our

by 36% in

will be depressed even

savings and loan associations, sav¬
ings banks, and commercial banks

residential
this year

Outstanding non-farm
mortgages

in¬

life insurance companies,

When

individuals
have increased their demand for
loanable funds to a record level.
restriction,

toward

prospects of

issues have been depressed.

"tight

demand
for
money by other users may be so
great that further advances in in¬
terest may develop.
At present,
that seems quite likely, and if it
does
develop, the bond market

and

we

the

as

debt, and there are

nigh impossible.
Of
course,
the

again in the years
1954, gross private savings
exceeded gross investment.

to

attention

our

great

as

government

(d) Automobile sales are below
the same period for 1955, and
tj
lack of sales has been charged#to

debt

being able to
a short period
the ease in the
'20s. In order to do so, we would
need a Treasury surplus of almost
$10 billion a year. That is vvell-

returned,
1952-1953

also

deficits

conflict,

Spending

Consumer

with

returned

tions

I

some¬

10 years as was

of

condi¬

war-time

When

period.

stimulant.

additional

War

reduce it

in ihe postwar

vestment demands

times

10

over

no

savings from the war pe¬
large credit and

4

is

sufficient carry

over

ally costs most borrowing com¬
panies less than half of 1%. Ac¬
celerated depreciation acts as an

'
" -;.
}•
Regardless of "tight.money pol-

is

The Federal

of

price

The

(c)

rate

situation

current

different.

World

ceeded private demand tor funds,
largely due to the effects of clef'<"t Federal financing for military
purposes and to restrictions on
In
other
non-military spending.
was

"

-

;

>

The

'he war years 1.941-1946 were
when savings greatly ex-

there

are

terest.

No Effect on Wages

"Tight money" has had no ef- :

feet on wage rates. This is no '
oddity since labor unions as a rule concern themselves with obtain-;

Corporations and individpaying higher rates of in-

(b)
uals

Treasury retired

what

years

words

in

par

Thursday, December 13, 1956

.

-

.

$16 billion in 1930.

with
1946
and extending
through 1951. On the other hand,

income taxes are as
high as at present, it would take
much higher interest rates than
now
prevailing to deter business
borrowing. After all. an increase
of

gross

ning

corporate

to

higher rate of interest on all new '
offerings..

.

.

.

|n§ the largest possible <increase
debt from $25 billion in 1919 to and municipal bonds and corpo- *n wages vvithout giving inflation¬
attention
to money markets and

the

gross

tangible evi-

of industry is

back

-

bon d,s
the '20s

to equate with savings and as
the Federal

gan

private savings failed to match
investment (which includes
loans). These years were the six
of the seven
years immediately
following World War II, begin¬

capital expansion on the

Fixed

part

since^l940, years hove |^en
t^pre in which
different

Debt

government

demand for loanable funds be¬

as

Tight Money and Business Volume
in

Federal

Reducing

23

Continued from page

was

Financial Chronicle

The Commercial and

(2604)

108

banks

to

supply
their
need temporarily.
The expansion of business and not
"tight money" has brought about
the shortage
of available funds.
money" did not affect
the
purchase of goods by local
governments
as
evidenced
by
$32.6 billion in the second quar¬
ter of 1956 as compared to $29 5
billion in the same period of 1955.

R.

Stuart A.
Vice-President; and

President;

Nance,

Cummings,
H.

Houston

Slate,

Secretary-

Treasurer.

George S. Braun
George S. Braun passed away

"Tight

at

of 75 following a long ill¬
A former
member of the

the age
ness.

Philadelphia
had in the
of

Ware

Stock Exchange, he

past been with the firm,

& Keelips.

Volume

184

Number

Continued

5594

from first

.

.

The Commercial and Financial Chronicle

.

Bank Credit and

page

Despite

Money Supply

Middle

East

Warburg

the

strength of credit
demands, growth in total commer¬

judgment—sincere differences,

We

do

undertake—and

not

not see how it could be

short of
—to

form of

some

how

say

do

otherwise,

dictatorship

given

a

I

Reliance Upon Market's Judgment

Experience

demonstrate;
credit

would

determined

united in

through

the best

of

allocations

that

—is

to

seem

System

the

what

judgments — or guesses — of
public authorities, however wellintentioned. I was told recently of

r

to

restrain

ex-

It has been estimated that

rise

only one point
consumer price
index
a

that

do what the

to

of

would

the

cost

the

in

(BLS)
public

American

a

tongue-in-cheek sign that hung, $2*/2 billion a year.
in a Washington office some years '
The
Federal
Reserve
ago. It read: "Our guess is always
has
been
devoting
its

System

that collective
judgments expressed through the

efforts,
varying times and circumstances, to assuring monetary

market

and

best."

It

not always
is consistent
heritage and our insti-

our

tutions

process

which

under

nomic

direct

intervention

vernmental

to

are

process

best, but that
with

be

may

confined

is

affairs

general policies

to

and

protect

public interest.-. ;*

eco-

largely

broad,

sary

gov-

in

At any
•

~

'

conditions

that

would

help to foster high levels of busiand

ness

employment,

maintain

the stability of the currency,

and

promote sustainable growth in the
economy.

V

neces-

/

:

^

.

Leaning Against the Breezes

Yi

economy

The System has sought to keep
constantly
alert to
changes
in

volume

lower

given time the

is capable of producing

than

in

the

in

vestments

in

the

total
of

months

12

October

was

XV3V

demand

__

Currency—to
_

.

about

,y

.

.

human

material.

and

diffi-

The

breezes of inflation and

deflation

,

1954, even though

fcssur

Jeady availability of credit
"
"
^ economy generally, and
toward creating liquidity condilons favorable to revival and
exPansion. In part the develop™ents si,nce 1954 should be mJ?rPretJd as a transition from a
time of ready availability of resou**95s' r^duced demands for
crfdlt» and a monetary policy of
a4:.iye ?ase to a ^me of intense

Public

Carey

of

Y

Y

Business English—J. Harold Janis,

Jn

Edward

Dressner

York

Gains

Noble,

Taxpayer

with1 trial

"Research

mendations"

N.

re-.

Hill

-

Interest

Y

V

;

r

late credit

the

Money

^

Reeded.

expansion to help halt

decline

foster

and

the

re-

of

reau

;

high annual rate

; ^COVery that began in 1954 and
■!" 'Creating
more
money ' won't carried through into 1955.r As we
s
produce more things .'when the moved from recovery to boom in
i
,

;r

economy is running at peak levels.
A choice has to be made—and the

"t public in.the end has to make the
choice of whether we shall have
.

of this and

more

less of that.

We

have,: in a given period, just
so
many
houses, > automobiles,
household appliances^ s c h o o 1 s,
manufacturing plants, and a myrlad other things, including ships,
planes, submarines, and other es-

.can

•

.

sentials of defense.:-Under present
Z. conditions,
-

given

up

something has - to be
at
least -for. a
lor,
time,
time.
:

Throughout
bmed*

this

demand

The

year.

funds

for

com—

for

credit—coming from virtually all
of

sectors
at

to

has been

It has outrun
supply.
Contrary
impressions, the Reserve
has not .reduced the

available

some

System
i

economy

all time high.

an

the

the

supply; in fact the

money

money

1955 and

against

limits

of

the

in

growth

discourage

thatSHpuld

cesses

to

inevitably

jsp

as

higher prices

duce

and

Focussing

events <0£

N.

Ann

U-M

—

Qf

on

an

featuring

SUppiy

0n

credit

easy

desired

al-

utilization

upward

price

situation, to
terms all of the

by prospective in-

vestors would

fiationary

business

this

In

have increased

bidding

w

for

preserving the

r>

it

in-

1955.

in

Moreover, the turn-

_

the

over

velocity—of

the

exist-

ing money supply has greatly in-

-

available

LOS

ANGELES

creased.

Although

"tightness

-of

credit

an

of

money,

the
is

so-called
often at-

insufficient supply

the

fact

is

that

the

*

*

tightness results from the volume
intensity of demand.

It also would have in-

California

volved

rise

mercial

Not

Create

More "Goods

the

credit

bank

of

volume

in

and

i

and

Despite

the

and

restraint

spending

on

Calif.—Roy T.

The

great / bulk

of

loanable

savings

represents

of

the

community made available to bordirectly
institutions

rowers

cial

mercial .banks,

or

through finanthan

other

^

such

as

rapidly than

more

was

mutual

vear<;

Z??_r!

of

con.

—

£us?~o?

individuals.

It

is

often

for-

gotten that when the commercial
and

investments, it generates
money.
When, as has been

ease

new

the

this year, aggregate demands

machinerv

machinery

n

eanking system expands its loans

lines

them, in
UC|S

*iZ onidithe
the only way to finance them all
would

be

by

an

even

greater ex-

pansion of bank-credit
fey

generating
I

still

—

more

rent

heaviest.




are

the

expenditures

money,

^at-

affected

construction

construction
by

part

in

areas

in which

restraint imposed upon curr

policy

have

and

metals and metal prod-

These

that is,

emphasized,
rog more money will not create
more goods.
It can only intensify
demands for the current supply
as

and,

and

was,

quite

by

monetary

possibly,

Diary, P. O. Box
lington *10, Va. $2.

United

the

Puerto

waii,
„

^

,.

.

.

City

omy

Treasury

spices

:• v•

>

.

t

•

Mich.

—

iiVfr.

Richard

J.

Fla.—Safeway In¬
Corporation is engaging

securities business from of-

a

at

g4

officers

are

fjces

jdent;

North

street

Carr W. Turner, Pres-

Hershell

President

Court

and

G. Stuart,'ViceTreasurer; and

Donald Walker, Secretary.

ern

Mr.

previously with EastSecurities Corp.

Turner was

It is in these sectors that

.

__

E.

Gernon,

Partner

American

Trade
Association,
82
Street, New York 5, N. Y.

of

Insurance
Bureau

Air

-

the

ia

.

Dis¬

Property-Liability
John

S.

Bickley —
Research,
University, Colum¬
(paper) $2.

—

of

Business

State

bus, Ohio
United

;.v.

;

tribution

...

States

Business

Perform¬

Abroad: The Firestone Op¬
in
Liberia —
Wayne

ance

eration

Working Creatively for the Good

rt m e n t of Economics and
Sociology, Princeton University,
Princeton, N. J. (paper) 50c.

Interest—Chamber of Commerce

Wage

Systems

:
—

A

se¬

p a

•

Journal

of

Retailing, Fall

articles

Including

on

Personal

and

"Economic

in

in

the

Public

States, Washing¬

"Coordi¬

Selling,"

Characteristics

Harvey Shields Opens

of

Profits," "Trends
Branch-Store Organization,"
of

l

West

145

gage

proceedings of 12th annual con¬
vention
Magnesium Associa¬

Calif. —Harvey

H.

Shields, Jr. has opened offices at

ple's Money," etc.-^-New York
University School of Retailing,

Washington Square Center,
New York 3, N. Y. (paper) $1.

Own Inv. Office

FRESNO,

"How to Work With Other Peo¬

jje

Garland Avenue to en¬

inb the

was

securities

formerly

a

business.

partner in Da-

vidson & Co.

Lewis C. Herwig
Lewis C. Herwig, Partner

in B.

—

bave resulted irom easier credit Carl M.

tion, 122 East 42nd Street, New

would have been concentrated.

York, N. Y. $5.00.

Loeb, Rhoades & Co.,
passed away Dec. 1 at the age of 71.

in

ton, D. C. (paper) On request.

Retail Trade: Size and Volume,"
"Pursuit

and

United

the

of

1956—

nation of Advertising with Dis¬

play

Business

of

Magnesium Association—Complete

Frank E. Gernon
Frank

different

—

herbs

and

Annotated Bibliograph—

lected

ORLANDO,

in

50

Industrial Relations Section, De-

,

_Jtowisnov
Gutow is now affiliated with R. F.

vestment

S.

Chatfield, Taylor—N a t i o n a 1
Planning Association, 1606 New
Hampshire Avenue,:Northwest,
Washington 9, D. C. (paper) $1.

Incentive

rt

(Special to The Financial Chronicle)

DETROIT,

Spice
Wall

mnufactimer^T^st

Washington 6, D. C.

■

U.

Illustrated

—

on

$4.5°.

Transport Association of Amer¬

'

*

Spices

of

encyclopedia

15, N. Y.

—

—

Statistics, 341 Ninth Ave¬
New York 1, N. Y. On request. '

partment, Manufacturers ITust
Company, 55 Broad Street, New

Expanding Econ¬
Stuart G. Tipton — Air

/

nue,

ica, 1107 Sixteenth Street, N.W.,

R. F. Campeau Adds
-

Worker Families

Trends and Problems

an

Y

Labor

Is^

:

•

Department o£ Labor, Bureau of

States,

Virgin

Rico,
T

^

166, Ar¬
;

Standards and Levels of Living of

Depart¬

S.

School

Associates—Securi¬

ties

the

h additional demand as would
,

U.

Physical

n e ss *

L.' Weaver

Alaska, Canal Zone, Guam, Ha¬

Inc., 230 West State Street.

af-

fecte(j by investment expenditures,

—

in

Graduate

interest and dividends—Edward

1, N. Y.—On request.

in

Holidays

*

ticularly

and

New York

Harvey

finance

in ' sectors

:

Labor, Bureau of Labor
Statistics,
341
Ninth Avenue,

—

Diary — A simplified
accounting system for record¬
ing profits, losses, capital gains,

—

ment of

Freight in

~aS^
ComPany' Penobscot

marked

J:

Bus i

Ohio

a number of key areas pressed Budding,
against the limits of capacity,
Form Safeway Inv. Corp.
Price increases have been par-

corporations,

.

Freight

Securities

Earnings

ropolitan Area

with

now

banks, insurance companies, savings and loan associations,
private and public pension funds,
companies,

i;

Air

Administratidn,
\ H a r v.a r d University, Soldiers
Field,' Boston, Mass. $2.50.- ;

in Mahufacturing Industries in New York,
Northeastern New Jersey Met¬

.^refnJlas ce<Ln added,^° ^e

?tafi

consistent

.

.;

How the Businessman Can Use

credit

stahilitv

.!

.

.

of

v.i

^

Weekly

(Special to The Financial Chronicle)

*.

ceVf»ral

.

of

Distribution

Gross and Net Spendable Average

With Fusz-Schmelzle

wRh price stability. The orice advances
that began in 1955, after

com-

savings

A

Publicker and
are

mands in many sectors have risen

funds

Role

16, N. Y.

Leonard S. Silk—McGraw-Hill
Book Co.,, Inc., 327 West 42nd
Street, New York 36, N. Y. $15.

Investors, 3932 Wilshire

JACKSONVILLE, 111.

imposed by monetary policy, de¬

American
E

(paper) $1.

York

demand

capabilities

Tax,

Forecasting Business Trends

>

Department of
Labor, Bureau of Labor Statistics, 341 Ninth Avenue,: New
York 1, N. Y.
On request.
•

;

•

Handbook for

Edition

1956

oanKeis Associauon,
36th Street, New York

'

stability and sustained growth.
growth

The

-

1949—U. ;S.

of

Government

—

;•

v

ysis of Title
f

'

f

,

com-

deposits in particular, that would
compound the threat to economic

and

Would

in

credit,

on

1956-57

_

Ranksi.

Boulevard

a

22, ;N.\Y;. (paper) $2.95.

$6.00.

g Amencaof Housing Act
sCi es—Anal
I

1

(Special to "The Financial Chronicle)

gtruction.

outstanding

Journal of iaxanon,

„

1 nree With Lallt. Investors

Sris''vearathouehnat a'ferrate rP,sourcets.«sPecially '■? thesectors Margrave, Samuel
TP,S year^inougn ai a resser rate 0f capitai equipment and con- jack R. Schoen
than

stabil-

direc,^d to Preserving the stabil-

—

Renewing America's Cities—Anal

per) $2.00.'''.Y'

|ty of the economy, and the stabilof the dollar that underlies it,
so that we may move steadily
along the road to a higher standard of living for all.
rpi

Oh request.;
un request.,

in-

V Plaza, New York 20, N. Y. (pa-

contrast to that of
the early 1930s — is not one of
creating millions of jobs overnight,
to cure mass unemployment, but
?ne of sustaining the millions of
3°hs we have today and fostering

'

r

1

,

[^8 us

to

tn-

Inc., 147 East 50th Street, New

Facts and Figures

Basically, the problem confront-

directed

pianni™,,

Foundation, 30 Rockefeller

A°d»y » rrppiem

Policy

-iment—Equipto Division of Aurora Equipment Co.
Aurora,* 111.

/

;

I,

'

•

y

;

Depreciation

Reference Manual of Steel Equip-

Building}

TSnf Sfon

1*lcome
York.

Meeting that problem requires
that the efforts of all of us be

economy

high

and

resources

pressures.

in

<

Pending working force tomorrow.

inhoront

investment

ready

p

,

Company, Inc., 330
Street, New York 316,

Y. $6.50.

ington 6, D. C.

Serv-

Distribution

T

Finance

the

on

inflationary

increase

F

:

,

new job opportunities for an ex-

dangers inherent incnorimn^ina
in superimposing
massive

;

Y:

(Second

t

Arbor, Mich. $6.00.

on

agriculture. -

Scent—

Marketing

Book

Realistic

in

Administration.

ice,

and

apparent

was

positive

were

Han^rc

^ it

1956

pro-

.

closely

more

ex-

severe

economic maladjustments.

there

re-

prudence-

as

the part ofGovernment, business, finance, labor and

general pressed
limits of immediate'■>

the

sources

a

restraint,

through 1956, and as

on

capacity, the System took steps to
keep expansion of credit within
the

well

as

economy in

the

-

aess,

of

W.

University of Michigan
Publications

is-a situation that calls for alert-,

L.

Company
Georgq Terborgh—Machinery &
Riegel—Bu¬ ;a»- Allied Products Institute,- 1200
Industrial
Eighteenth Street, N.W., Wash¬
Relations,1

Success—John

.

?

John

'

•

labor and materials.'

Certified

—

Institute

5

in

West 42nd

•

of

Y.

Edition) — Malcolm P. NcNair
& Harry L. Hansen—McGraw-

Recom¬

Y; v:"

Employee

culty■-throughout this year has alike, as I have put it a number Of over $332 billion in October
been
the attempt to, crowd
too of times.
"
V—$21 billion above the rate a year
much into a given timd period—
Thus, when the economy had a ago — and international disturbdemand, m brief, has been press-:downturn in 1953, the Reserve ances that could add to further
ing strongly, against the supply System acted promptly to stimu- overstraining of our resources. It

-

r-"cv

to

(paper).

at

Y.

American

and the American

Readings

subscription

Institute

of

bibliography — F.
W.
Faxon
Company,
83-81
Francis Street, Boston 15, Mass.

for V
In¬

—

42nd

N.
'

Accountants

—

Addenda
j

$24 — Research
Institute Recommendations, 589
Fifth
Avenue, New York 17,

'

,

&

Opportunities

Average

cluded
to

Barnes

Fifth Avenue, New
13, N. Y. (paper) $1.75.

105

Capital
The

—

36,

Public Relations, Edward L. Ber-

Kilduff and Howard

J.

Ethics

West

Accountants, 270 Madison Ave¬
nue, New York 16, N. Y. (cloth)
$4, (paper) $3. VvyyY\y
nays

R.

Inc.,

resources, very
demands,
and
a

new

nnnn

nn

Labor, Bureau of
Labor Statistics, 341 Ninth Ave¬
nue, New York 1, N. Y. 45c.

partment

J°an demands then were generally
.,s. actlve- During that period,

a

TWhnnWv

Professional

"°™!C:u^eC OuOSy,,,an£.an™"
tated bibliography—U.
S. De¬

"|lse'that °c1c"Lred from ™ldr

come at

Company, Inc., 330
Street, New York
$6.50.

Company, Hartford, Conn,
(cloth).
v;V
:/ V • :>VyY; ■,

ance

_

Ruggles and Nancy
Ruggles—McGraw-Hill Book

D.

,

•

Chicago 37,

—Richard

Its First Hundred Years—Rich
ard Hooker—Aetna Life Insur-

stramt of inflationary forces.

Avenue,

t

t

Company:

If

n}°netary policy directed to

Principles and

Analysis—Second Edition

come
*

^

53,5 tnrough

Archives:

National Income Accounts and In¬
*

+?n exPansion lr|" bank
credl^ and the money supply this
year contrasts with the rapid in.

Avenue,

111. $5.00.

denosits

1V
t

Vanderbilt

Ellis

5750

banks

ending with
to
2%, and

held

•

in¬

and

Just now, the year is coming to
of goods and services limited by
and
to adapt its operations ac- a close with demands still outcurrently available resources, eordingly — leaning against the pacing savings, with personal ina

P.

Techniques—T. R. Schellenberg
—University of Chicago Press,

^"^h^nrivatplv'

SUDDiv

monev

loans

commercial

25

Modern

corre¬

economic and financial conditions,

.

James

—

Current Affairs

—

17, N. Y. (paper) 25c
(quantity prices on request).

a

rate, below the average
period and some¬

utilization of
strong credit

.

the

promote

'

,

through

credit

to

sponding period in 1955. Thus, the

arising from monetary

causes.

to

is

do,

can

cesses

market process are to be preferred

the conviction

course

limited

was

the postwar

of

Reserve Banks with 24 branches
having all told some 260 directors
representing varied walks of life

of

supply

credit ,hnii be allocated.
shall

i

credit

moderate

of labor and materials. That is
outright inflation,
The Reserve System—and it is
a nationwide system of 12 Federal

Crisis

New York

bank

increase

in

.

Press,

cial

Reserve Policy During
Inflation and Deflation

109

(2605)

C.

Christopher

&

Co.,

Kansas

City, Mo., passed away Dec. 2.

310

The Commercial and Financial Chronicle

(2606)

•;

I'J

-

-■*'

'

.

in

v■/■*;/:

in

offered

be

to

units

follows:

as

100

units

"A"

Nov. 29

•

.

indicates

additions

previous

since

-

l£SUE

Revised

• items

V

(letter of notification)'an undetermined number

shares of

of

common stock
(par $5) to be issued under
company's 1957 Employees' Savings Plan./Proceeds

the

(each

Thursday, December 13, 1956

Petroleum Corp.

ic Crown Central

Oct.

Ohio. Underwriter

Office—31711 Solon Road, Solon,

ital.

f

Beckjord Manufacturing Corp.
12 (letter of notification) $50,000 of series A 6%
debenture
bonds, $50,000 of series B 6% debenture *
bonds and 207,500 shares of common stock (par 10 cents)

^ Adams Engineering Co., Solon, Ohio (12/18)
3 (letter of notification) 25,000 shares of common
stock (par $1).
Price—$8.50 per share.. Proceeds—For
construction of additional facilities and working cap¬

Dec.

.

■

*

Now

.

.

I

—For

purchase of stock in

the

operi market.

Office—

'

—The First Cleveland

j

consisting of

Corp., Cleveland, O.

Amalgamated Minerals", Ltd.
(letter of notifications) 3,000,000 shares of com-

share.

St., Denver,

Colo.

of

properties.'

Office

-—

Sherman

901
&

Underwriter—Lackner

Co.,

Colo.

Denver,

.

if American Communications Co., Inc.
Dec. 3 (letter of notification) 590 shares of 5% cumula¬
tive preferred stock.
Price—At par ($100 per share).
Proceeds—TO acquire a small telephone company and for
extensions

of

betterment

and

facilities.^ Office—Tele¬

American Federal Finance Corp.,

Killeen, Texak

Sept 5 filed 40,000 shares of class B common stock (par
f5) arid 400,000 shares of preferred stock (par $5) to be
offered in units of 10 preferred shares and one common
share. Price—$55 per unit. Proceeds—To purchase used
car paper and
to extend the company's operations into
the field of new car financing. Underwriter—None. J. J.
Fain is President.
.

#

Income Fund,

if American Investment &

■

Inc.

pec. 11 filed 100,000 shares of common stock. Price
market.

r
—

At

Co., Newark, N. J.

Proceeds—For investment.

Price—At market.

if American Trusteed Funds, Inc., New York
Dec. 5 filed

Price—At market. Proceeds

—For investment.

if Atlantic City Electric Co. (1/23)
12 filed $10,000,000 of first mortgage bonds due
1987.
Proceeds—To repay bank loans and for construc¬

Dec.

tion program.

Underwriter—To be determined by com¬
Probable bidders: Halsey, Stuart & Co.
fnc.; The First Boston,Corp. and Drexel & Co. (jointly);
Eastman Dillon, Union Securities & Co. and Smith, Bar¬
ney & Co. (jointly); Blair & Co. Incorporated; White,
Weld & Co. and Shields & Co. (jointly); Lehman Bro¬
petitive bidding.

thers; Blyth & Co., Inc.
Jan. 23.
,

_

Bids—Expected to be received
'V; / /,,

Atlantic Oil Corp., Tulsa,

Okla.
April 30 filed 2,000,000 shares of common stock (par $1).
Price—$1.50 per share. Proceeds—For working capital
and general corporate purposes. Underwriter — To be
harried by amendment.
Statement effective Nov. 29.

:—None.

Proceeds-f-To

retire indebtedness of the

com¬

to its affiliates for money borrowed for working
papital. Underwriters—Hallowell, Sulzberger & Co. and
pany

Charles A. Taggart & Co>, Inc., both of Philadelphia, Pa.,
and Weill, Blauner
Co., Inc. of New York.
#"•
'

///'

//-

/

;//

■

.

Nov. 20

stock

'

Price—$5

share.

per

•'

Douglas Corp., Fort Collins, Colo.'' :
;
July 27 filed 4,000,000 shares of common stock (par oris
cent).

Proceeds—For

for

con¬

?

*

,

Packing Co.,

&

Dec.

Shore

•

Mines, Ltd., Toronto, Canada V
shares of capital stock, of which
to be offered publicly, and, 100,000

Pjrice—At par ($1

For

equipment, exploration,
other general corporate

and

writer—To

be

named

;

drilling, working
purposes. Under¬

/

Z

debentures due Dec.

by

debentures
on

1, 1981, being offered for subscrip¬
stockholders on the: basis of $100 of

common

for each

shares

20

stock

of

Nov.

held

of

Underwriter

New York.

Z//

//H

,

-

■

•

..

Mutual Fund, Inc.
Aug; 24 filed 300,000 shares of Common stock. Price—At
market.

'Proceeds—For .investment.

ton, D. C.

Office—Washing¬

Distributor—Automation Development Secu¬

rities Co., Inc., Washington, D. C.
Automation

stock

(par $1).
PriCe-f-$5.25 per share. Proceeds—For working capital
rind other corporate purposes. f Underwriter — None.
Harry Kahn, Jr., of Washington, D. C., is President and
common

Treasurer.

(1/15)

30

Uranium

Mines, Ltd./ Toronto, Canada
595,000 shares of capital stock (par $1) to
exercise of stock purchase warrants

filed

issued

upon

which were issued early in 1956 in connection with a
public offering of $8,500,000 of 5V2 % sinking fund debentures. These warrants are exercisable on and after
Jan. 1, 1957. ; Price—$1.75 per share./ Proceeds—To re¬
some

of the debentures.

Underwriter—None.

/

if First Investors Corp., New York
•//•/'';
Dec. .11 filed (by amendment) $100,000 additional
Lehman Brothers// riodic
payment plaits !and single payment plans.

—

'V /'/

■

,

Proceeds—

/,

///.///

pe¬

Z

Flakewood Corp.,

San Francisco, Calif./''/>■//■
filed .100,000 shares of common stock. Priced

•v
Centers Corp.,.. Philadelphia, Pa^
'//■*•;. v
Nov. 14
July 30 filed $8,000,000 of 5V2% sinking fund debentures
At par. ($10 per share)/Proceeds—For construction of
due Aug. 1, 1971, and 1,600,000 sharer/ of common stock. i
/manufacturing plant-and to provide working capital.
(par one cent); subsequently amended to $4,500,000 of
Underwriter—None.~ Robert E. Evju is President.: "

debentures.

Price

Proceeds

About

seven

.—

To

—

be

supplied

shopping

$4,100,000
sites

center

will be

by

amendment..

and

a

used

to

Fruit

Penn

acquire

/ -Z //.
-.
2,000,0(6) Shares' of common stock (par, iO
Prlce-r$5' per share,/ Proceeds—^Fon.investmeriir:
Underwriter—Frank B^Batemari, Ltd., Palm Beach, Fla.

/■// Florida Growth' Fund, Inc. /

..

/Now 23 filed'

super¬

market adjacent to one of them; the balance will be used
to develop shopping centers at the seven sites and to

cents),

,

for related real I
if Flowers by Wire'C6rp.'f Marion, Irtd. - •
corporate / purposes. / Dec. 3
(letter of notification) 100^000 shares of common
Underwriter
Blair & Co. Incorporated, Philadelphia -•
stock.
Price — At par ($3 per share).
Proceeds— Frir
and New -York. Latter has agreed to
purchase an addi-<
\Vorking capital/ Office—1*115 S. Washington St., Marion,
tional 300,000 common shares and reoffer tbem to per¬

acquire
estate

industries^Corp., Washington, D. C.

May 11 fiied 179,000 shares Of

share.

?

'

} Automation Development

Faraday

tire

record

30, 1956; rights to expire on Dec.. 17, 1956. Price
par (flat). Proceeds—To reduce bank loans and for

expansion program.

per

Eternalite, Inc., New Orleans, La.

be

Burroughs Corp., Detroit, Mich.

tion

Price—$2

prospect for natural gas. Office—317 Bald¬
Bldg., Erie, Pa. Underwriter—McDonald, Holman
Co., Inc., New York.
I ?

Nov.

later.

Nov. 9 filed $30,154,700 of 4/2 % convertible subordinated

cents).

50

(Par

Sept. 24 filed 200/300 shares of class A common-stock
(par 50 cents),. Price—$4.50 per share; Proceeds-—To
repay loan; for maintenance of. and increase of inven¬
tory; for development of branch offices; and for research,
laboratory tests, and testing equipment. Underwriter—
Vickers Brothers, New York.
/ .
//•*•-.. /:"

share). Pro¬

per

4

win
&

are

shares to promoters.

-

.

.

Natural Das Co^> Inc.
.
(letter of hotification) 75,000 shares of commqn

To drill and

filed 600,000
shares

capital

Securitiei

Underwriters—W. E. Hutton

-

stock

Brookridge Development Corp.
/
(letter of notification) 300,000 shares of common
stock. Price—At par ($1 per share). Proceeds—For work¬
ing capital. Office—67-12 62nd St., Ridgewood, Queens,
N. Y. Underwriter—Wagner & Co., New York.

—

Underwriter—Columbia

Co., Cincinnati; O.,- and Kalman & Co., Inc., St. Paul,

if Erie

Oct. 29

ceeds

working capital.

Minn.

obligations, purchase equipment, etc. Office—1308 »■
Patt Street,
Anaheim, Calif.
Underwriter—J. D.

500,000

For e*-

Co., Denver, Colo.

general corporate purposes.

Anaheim, Calif.

Aug. 13 (letter of notification) 222,222 shares of common
(par $1). Price—$1.35 per share.
Proceeds—To

Burma

—

•

stock

July 26

10 cents per share/ Proceeds

—

if Economics Laboratory, Inc., St. Faul, Minn.
;
/Dec. 12 filed 100,000 shares of common stock (par $1).
Bridgehampton, L. I., N. Y. Underwriter / Price—To be supplied by amendment. Proceeds—For

O. Box 506,
—None.
P.

No.

Price

/ploration, development and acquisition of properties and

*.*../

struction, improvements, etc. Business—To construct and
operate an automobile road racing course.
Address—

pay

unit

-

(letter of notification) 55,075 shares of common

(par $1).

stockholders in units of 25 preferred shares and

purchase five common shares. Price—$25.50,
(each warrant will entitle the holder to purrchase one common share at any time prior to/Dec. .3JL,
1957 at $2 per share )< Proceeds—To repay mortgages, to
$1,312,5(H) of fivri-year 6% sinking fund debentures, arid'
fOr further acquisitions and working capital.
Unde^»
writer—To be named by amendment. . ;
-

*

<

'

warrant to

per

:'"'

Bridgehampton Road Races Corp.

—At

Atlas Credit Corp., Philadelphia, Pa.
v
;
11 filed $600,000 (if 6% convertible subordinated
debentures due June 15, 1968. Price—100% of principal

June

amount.

*

Denver, Colo.

shares of 6%

(par 10 cents) to be offered for subscription initially by;

Creger & Co., 124 North Bright Avenue, Whittier, Calif.

(by amendment) an additional 200,000 Lex¬

ington Trust Fund Shares.

•

-/

'•

29

common
a

if Bing & Bing, Inc. - '
i
//
/; Z
Dec. 3 (letter of notification) 3,465 shares of ebmmrin
stock (par 10.cents). Price—47.62 cents per Share. Prp-.
ceeds—To William J. Williams, the selling stockholder.
Office—119 West 40th St., New York; N.-Y. Underwriter

Bridgford

-^American Mutual Fund, Inc., Los Angeles, Calif.
11 filed (by amendment) 1,000,000 shares of capital

-

River, N. J.; Undcrwriter-^Berry &

Proceeds—For investment. Office—Washington,

Dec.

on

units, .$100 each,*

filed 2,500,000

convertible non-,
cumulative preferred stock, first series (par $1), arid'
warrants to purchase ; 500,000 /shares of common stotk
Aug.

tory; and working capital.
Business — Manufactures
"Unit-Inch" electric convector heaters./ Office—7 West
W»ater -Street, Trims

Underwriter—None;

Bldg.; Baltimore 2, Md.

Diversified Oil & Mining Corp.,

,

Proce^ds-r-To acquire or lease plant; tor dies and: ina^Chfriefy; proSuctidn equipment and materials; inven¬

D. C.

stock.

stock).

t

Underwriter—None.

phone Building, Haddam, Kan.

'

of

a

$500 each; and of series "C"

units,

of oil
'

shares

100

American

$500 "B" bond and 50 ;
units (each consisting
Price; Of series "A" and "B"

(each consisting of
stock); and 1,975 "C"

shares, of

Nov. 23

jnon stock (par five cents).* Price—10 cents per
Proceeds—For mining expenses and development

$500 "A" bond and 50 shares of stock);

a

100 "B" units

and

develop

activities,

and

additional
for

sites

general

.

it

by

$1.10

at

share.

per

Offering—Date
/...

•

Underwriter—None. '

Inc.

■

selected

sons

indefinite.

-;

■

.-/-/.Z./V.;"/.:.•/•//

.'Freiberg Mahogany Co.,
///'»///Z:*rr/
Oct. 11. filed $2,000,000 of subordinated debentures due

/ *'

Century Controls Corp., Farmnigdale, N; Y. ¬
1971 and 450,000 shares of common stock (par 10 cents),
Aug. 27 filed $600,000 of 10-year 6 % .debentures. Price— /■'
of which $1,500,000 of debentures and all of the stock
90% of principal amount.
Proceeds—For research and
are to be offered pribliciy in units of-$500 of debentures
development; expansion; equipment; and other cor- - and 150 shares of
stock; the remaining $500,000 of deberiporate purposes.
Underwriter — None.
' ' ".••• ..'V
vV:
turqs to be sold to Texas Industries, Inc., which owns
*

Baton Rouge Water

Sept. 11

Works

Co.

(letter of notification) ,6,946 shares of

common

capital stock

(nri par).'Price—$43 per share. Proceeds
—For extensions and betterments to water system. Office
-131

Lafayette

St.,

Baton

Rouge,

Underwriter—

La.

*

'

abf>ut

Century Controls Corp.
.'.
T
' /
Oct. 4 (letter of notification) $150,000 of 6% subordinate'
*

-

•

Beauty Counselors Inc.

convertible debentures.

(12/14)

N9V. 15 filed 22,000 shares of

stock

common

(par $1).

Price—To

be\supplied by amendment.
Proceeds—To
selling stockholders., Underwriters
Spencer Trask. &
—

C6., Lee Higginson Corp., and Homer O'Connell & Co.,
all of New York; Laird, Bissell &
Meeds, Wilmington,
Del.; and Chas. A. Parcells & Co.. Detroit, Mich.

(in

denominations

notes

payable,

of

Price—90% of principal amount
each). Proceeds/-—To pay

*

$100

reduce

accounts

and' to

payable

other current liabilities; also for working capital.. Office"

—Allen Boulevard, Farmingdale, L. I.; N. Y. Underwriter *
—None.

•

.

Chinook

Plywood,

'* '

;

Inc., Rainier, Ore.

Freiberg's' outstanding

of

common

stock.

capital; etc.; and front sale of debentures to Texas Indus-tries

pay

75%

Price—To be supplied by amendment-. - Proceeds—From
sale of units to retire short-term loans and for
working
to

retire

a

subordinated

promissory note payable
Office—-New Orleans, La.
Under¬
writers^—Howard, Weil, Labouisse, Friedrichs & Co.,JNew
Orleans, La.; Rauscher, Pierce & Co., Inc.,.Dallas. Texris:
and Russ & Co., Inc., San Antonio, Texas.
OfferingPostponed.
'
to

the

latter

firm.

Sept. 4 filed 200. shares of

common capital stocks Price—
($3,000 per share). Proceeds—For acquisition of'
plant site, construction of a mill building, purchase

At par
a

and installation. of machinery and
equipment, and as
operating capital. - Underwriter *— Industry Developers,
Inc.

:

'

'

.

'

* '
-

•

Commercial

Nov. 21

fried

Discount

Corp.;Chicago

ticipating preferred stock. Price—At
Proceeds

—

For

New York

*

Boston

Philadelphia

-

San Francisco

Private tVires




Pittsburgh

to

all

offices

-

Chicago

Cleveland

<

Chicago, 111.

par¬

($10

per share).
Underwriters—
Cruttenden, Podesta & Co., both

working capital,

Julien Collins & Co. and
of

(12/18) / //

100,000 shares of 6% cumulative and
par

etc.'

...

if Consumer Acceptance Corp., R. I.¬
30 (letter of notification) 11,960 shares of class A
.common slock (par 10 cents).
Price—$3 "per share. Pro- ;
ceeds
For general corporate purposes
Including the
making of loans. /Office—904 Hospital Trust Bldg., Prov¬
idence, R. I.t Underwriter—None.

in

You-sell securities faster when/you advertise them v
the Chicago Tribune. No other medium iq Mid-V

America

is

read-by so many investors—professional ?
buyers as well as the general public.

and institutional

To find out how you can get more sales iii
Chicago
and Mid-America, get the facts from your
advertising
counsel or nearest Chicago Tribune representative.

Why not do

so

today?

'

.

"

•

-

Nov.

—

tMt

wo*ids

cwtatiit

KiwirArr*

"

'*-■
/
/,
Z

!

Volume

•:

184

Number 5594 i

.

★ Fruit Juices,

.

The

.

Commercialxajid Financial Chronicle

(2607)

Inc.
Gold Mountain Lodge,
>v
Inc., Durango, Colo.
(letter of nqtjficationl 300,000 shares of .common:-/
Aug. .23 filed 5,000 shares of class A voting common
stock.
Price—At par <$1. per share);-. Proceeds^*— For *
stock .«(par .$1), ' 295,000 shares of
class B non-voting
working capital. Office, *-r- 11 i5 South Washington/St.,':.*
common stock .(par
$1); and $700,000 of 4% debentures
Marion, Ind./ Underwriter—Sterling Securities Co., Los
due Dec.
31,-1975*' to be offered for sale in the State*
Angeles,. Calif.
;;
/*".'
...••
' of Texas and
Colorado in units of 50 shares of class A
./General Credit, Inc., Washington, D. C.
stock, 2,950 Shares of class B stock and one $7,000
Aug, 17 filed $2,000,000 of. 6% subordinated sinking fund - debenture.. Price—$10,000 per unit. Proceeds—For
-

..

Hartfield

Dec. 3

'

.

Oct.

filed

2

.

.

i

,

stock, to be offered in units of $500 of debentures

v

warrants.

.

Price—$500

.

unit.

per

and 40

building,

working capital.

r

Opera tes year-round

Proceeds—For expan-

Guardian

arid' working captain Underwriter — None named
£ Oct;
Offering to be made through selected dealers.
;'/•
i

sion

»

pur¬

chase of property,
remodeling of present main
for new construction
and

./debentures, due Sept. 1, 1971; with detachable warrants*:/
i
to purchase 160,000* shares of participating preference
/

29

resort

BusinessUnderwriter—None

hotel.

Chemical 'Corp. f

:H

> ••

(letter of notification) $250,000 of 6% convertible
1;* 1966 being offered for subscrip¬

tion

(1/10)

-Nov. 13 filed 500,000 shares of 5% cumulative preferred

i

by common stockholders of record Nov.
5," 1956
the basis of $100 of debentures for
each 200 shares of

on

common

f stock j(par.$!^
be supplied by amendment. *;
pire
■?! "Proeeeds^-To regj^/lmnkvjban^and' fbr new construc- i •■'$100
i- tion. i UnderwrlteWi-Paihe, Webber, Jacksonr &" Curtis;/;

New

/

York,

and

Mitchum,

V Angeles, Calif./:-

:} '

Jones

Templeton,

Genisco, Inc., Los Angeles, Calif. (12/17-21/ / :/
12-year 6% subordinated deben-V

"(with stc&^

1,

I of

selling stockholder.;

a

To * be

for
for

general

corporate" purposes.

/■

borroy|uigs,j

mon

19

Corp.

vision.
<

Calif.

.

Calif.

com¬

'

;

,

.

circuit tele¬

Road, Redwood City,

I

■

.

E

-.7'

cising the conversion privilege conferred by the indehture.
The conversion price is
initially $27 per share of
stock acquired and is payable
by the surrender
of $25 principal amount of debentures and
payment ot
$2 in cash.
■■■-..
\ 7, 7
Hawaiian

Pineapple Co., Ltd.

28,

(Spencer

Trask
&

-

&

Co.;

Lee

Parcells

...

&

Idaho

.Common
&

Corp.;

Meeds;

Co.)

Power

Homer
Chas.

and

O'Cflrnnell

A.

shares

22,000

(Bids

.

Electronics

Inc

Debentares

_____

'

(Perkins '&

Co.,

Inc.)

$1,000,000

/

Ling Electronics Inc._—
(Offering

f

•

Valley

Investing

Gregory

Rose

be

Co.;

Sons)

&

(Bids

.

underwritten

Ac Co.,

Alien

bf~'

V/V/':

vTexas

Van

Fuel

Alstyne,

Corp

Noel

&

:

Co)

(Bids

and

Southern

{■ Genisco, Inc.

$2,250,000

January 9,

:

Co.)

(Lee

Consumer

Corp.^_

and

Lester,

33,#00

Finance

Alityne,

Noel

"

to

&

Ryons

shares

Co.)

P.

W.

of

&

Co.

Hotels

Corp.
278,733 shares of 5%% cumulative con¬
voting preferred stock, series A (par $25) arid
278,733 shares of common stock (par $2.50) to be bfNov.

23

filed

vertible

for

The

each

Inc.)

•

Webber.

--Common

Higglnson Corp,

P.

and

130,000

May

Stores

(Goldman,

Realty

Sachs

& 'Co.

Jones

and

(Newborg

Brothers)

$25.00O,Q0O

December
Adams

Engineering
(First

$J,250,000

(Bidjj

be

to

(Julien

Collins

&c- Co,

Corp.)

$212,500

Cruttentien,

&

Co.,

Inc.)

$499,996

(Piper,

5a:':ray &

.

to

be

rnvnted)

$7,700,000

about

20

Maine Fidelity Fire & Casualty Co._
(McLaughlin,

Cryan & Co.)

December 27

(Bids

to

December

Pineapple

(Offering

to

Co.,

stockholders

Witter

&

Co.)

(Bids

-

.

-!&

$1,243,750

to

be

be

(Bids

Southwestern

underwritten

underwritten
&

1957

to

be

to

be

&

to

be

Co.)

(Wednesday)
about

'

.

(Bids

invited)

(Bids

Common
by

Dean

ff.

January

to

be

29,

invited)

1957

,

(Bids

(Thursday)
Oklahoma

Prince Marine Drilling & Exploration Co.
Debentures &
(Shields

&

Co.)

(Bids

to

be

Eauip.
invited)




$9,600,000

be

invited)

___Bonds

$10,000,000

(Bids

to

be

invited)

Trust

Ctfs.

1957

to

be

invited)

Equip. Trust ,Ctfs.
$6,720,000

(Tuesday)

common

stock

(par 10

are

International

to

receive

common

ing shares of

stock

common

in exchange/for
Equity and Finan¬

stock

common

common

the

stock.

185,000 shares each of Interna¬

in

exchange for. all the outstand¬

stock of Investors Financial,Corp.

and Group Equities, Inc. International has been informed
that 142,000 shares of Equity common owned by Fre¬

Corp. will be tendered in acceptance of the Equity
Underwriter—None.

exchange offer.

Oct.

*:

31

(letter of notification) 4,256.6 shares of capital
stock (no par) to be offered for subscription by stock¬
holders at the rate of one new share for each five shares
held. Price—$17 per share. Proceeds — For expansion,
research and development,of new products, and to pur¬
chase equipment. Office—634 Prospect Place, Brooklyn,
Underwriter—None.

Investment

Corp. of Florida

Aug. 24 filed $515,000 of $60 cumulative preferred stbek
to be offered in units of $1,000 each and 5,150 shares of
common stock to be offered to purchasers of
preferred
stock

each

at

10

cents

capital.

per

share
Office—Fort

preferred

share

at

bought.

rate

of

ten

shares

for

Proceeds—For' working
Fla.
Underwriter—

Lauderdale,

Dec. 5 filed (by amendment) 15,000,000 additional shares
of common stock (par $1). Price—At market. Proceeds

Jacobs

(F. L.)

Office—Winnipeg, Manitoba, Canada.
Coi*

—To pay

short-term loans and for working capital. Un¬
derwriters—McLaughlin, Cryan & Co. and Gearhart &
Otis, Inc., both of New York.
Joa Co.

Debentures

$35,000,000

__Bonds
$20,000,000

-

July 27 (letter of notification) 110,000 shares of common
stock (par 20 cents).
Price—$2.50 per share. Proceeds
—For

;

(Monday)

aoouc

shares of

Oct. 4 filed $3,000,000 of 6% convertible debentures due
Nov. 1,-1966. Price—100% of principal amount. Proceeds

(Thursday)

Public Service Co. of Oklahoma
(Bida

of

share of Financial

one

411

February 4,

370,000

—For investment.

$10,000,000

Gas & Electric Co

Common

$1,375,000

Southern Pacific Co...

to

filed

★ Investors Group Canadian Fund, Ltd.

Co

Bonds

1957

.

None.

( Wednesday)

January 24,

:

Bonds

$5,000,000

Electric

invited)

to

..

$35,000,000

.nvited)

Pittsburgh & Lake Erie RR

shares

$4,000,000i

Bonds

invited)

29

N. Y.

(Tuesday)

approximately

be

.

bidders:

Securities

$4,650,000

Mountain States Tel. & Tel. Co

January 3, 1957

Common

by Green & Ladd

$3,850,000

Atlantic City Electric Co

-

Probable

Bquity Corp. common stdck, and the remaining 185,000
by Financial General Corp. on a basis of 1%

__Equip. Trust Ctfs.

invited)

invited)

Gas

(Bids

(Friday)
Underwritten

be

Southern Indiana Gas & Electric Co

.

$4,200,000

413,920

be

(1/7)

$20,000,000 first mortgage bonds due 1987.

International Postal Supply Co. of New York

by
Blyth & Co., Inc.) 105.000 shares

January 23, 1957

Ltd.__
—

to

(Bids

;~f.

28

— to

Savby-

shares

by

..Common

Brownell

of

cents), of which 185,000 shares are to be offered by The
Equity Corp. on a share-for-share basis in exchange for

shares

Pacific Gas & Electric Co

Equipment Trust Ctfs.

be .invited)

.Common

underwritten

292,000

January 22, 1957

(Thursday)

Chesapeake & Ohio Ry

Co.)

and

January 16,

■v

J
.Common

(Thursday)

Co.

share

International Bank of Washington, D. C.
Sept. 28 filed $1,000,000 of time certificates, series 1?^ C
and D. Price—At 100% of principal amount. Proceecb—
For working capital.
Underwriter—Johnston, Lemon &
Co., Washington, D. C.

mont

Co.__
be

Cincinnati, New Orleans, Texas &
Pacific Ry._(
^Equip. Trust Ctfs.
(

Equip. Trust Cti

December

$20,000,000

Norfolk & Western Ry.__

"yM

$J0O.0tX)

■

(Bids

Sc

Grant

(Bids

(Wednesday)

Northern Pacific Ry

$900,000

stockholders—-may

Staats

and

Preferred

Hopwood)

December 19

R.

to

B

Halsey, Stuart & Co. IpC.;
Corp.; Blyth & Co., Inc., Lazard
Freres & Co. and The First Boston Corp. (jointly); Kid¬
der, Peabody & Co., and White, Weld .& Co, (jointly);
Salomon Bros. & Hutzler; Lehman
Brothers, A, C. Allyn
& Co. and Wood, Struthers & Co.
(jointly); Kuhn, Loeb
& Co. Bids—Tentatively expected to be "received on Jan.
7, 1957.

tional

Winters National Bank & Trust Co.___

>

.

&

filed

bidding.

cial

(Tuesday)

Service

Read

7

shares

$1,400,000

Bonds

EST)

noon

(Offering to stockholder

Preferred
Holman

(Offering

..-Preferred
Po'l^s.a & Co.jfik

Murphy (A. A.) &,Co.f.Inc

Hawaiian

^fs.
'

$5,340,000

Corp

Corp.
(McDonald.

invited)

Valley National Bank—
William

$1,000,000

K D I

$4,875,000

stockholders—to

Dillon,

Equip. Trust

invited)

Preferred

and

Class A Common

Public
to

80%

★ Idaho Power Co.

Nov.

Mitchum,
$10,000,000

invited)

be

to

(Bids

,

(Offering

Common

and

;

(Tuesday)

Atlantic Coast Line RR
Commercial- Discount

Curtis

(Vickers Brothers)

-

..

Southwestern

^

Ctfs.

Equip. Trust Ctfs.
be

class

International Capital Corp., Des Moines, Iowa

Louisiana Power & Light Co

Co

v.eveland

&

January 15, 1957

isr>

18

v v

Trust

of California

Eternallte, Inc.__

$287,500

by

(Thursday)

Templeton)

to

(Bids

Equipment Trust Ctfs.
JSOT)

iiuon

underwritten

Jersey, Indiana & Illinois RR._-Equip. Tr. Ctfs.

-Common

Co.)

Reading Co
(Bias

New

„•

Bonds
Lehman

&

&

(Bids

and

offer will not become effective
of the class A and class B stock of

Proceeds—To repay bank loans and for construction
pro¬
gram. Underwriter — To be determined by competitive

about $2,000,000

,

Peerless Life Insurance Co
•

Inc.)

Corp

Co.

&

Brooks

W.

shares

be

$1,000,000

1957

Jackson

A

,

Missouri Pacific RR

$1,000,000

Kromex Corp.

invited)

General Telephone Co.
(Paine,

Co.

Ross)

10,

class

exchange

.

Common

Equip.
be

to

January

$750,000

<fc

&

t

stock

Preferred

Brooks

stockholders—to

(Bids

.

(Lee

$5,600,000

RR

^.-Debentures

and

~

(Offering

Wabash

:

(Wednesday)

of Commerce,
Memphis, Tenn.

•

"Leftwich

Corp.

.____+

Higginsot: Corp.
•

1957

about

National—Bank

•V

$300,000

Debentures and Common

Johnson
Higgins
$300,000 debentures and

Kromex

Debentures
$35,000,000

Equipment Trust Ctfs.
invited)

to

t.'i-V

Ball, Burge & Kraus, both of Cleveland, O.

Hilton

Equitable

(Tuesday)

invited)

be

to

be

(Monday)

(Wilson,

(Van

$9,000,000

1957

Ry
(Bids

_^____*;i_______Common

Securities

December 17

Guardian

Preferred

EST)

New England Tel. & Tel. Co

:

,

$20,000,000

Co

a.m.

Common

(Frankitn

'

11

1;,

ir Hensen Manufacturing Co., Cleveland, Ohio
Wv
11 filed 133,200 shares of common stock
(par $1).
Price—To be supplied by amendment. Proceeds—To Cell¬
ing stockholders. Underwriters—Hayden, Miller & Co.

Dec.

Bonds

ESTi

a.m.

January 8,

•

-

$694,900

Marie Reid
I

11

Pacific Power & Light

/•■/.;^Perkins & Co., Inc.) 183,333 shares /
Mohawk Airlines, Inc
Debentures
/ (Mohawk

$20,000,000

___Coihmon

stockholders—to

to

invited)

Pacific Power & Light Co
.

Ling

Bonds

be

to

the basis of one new share for
Price—To be supplied by amend-

on

Proceeds—To reduce bank loans and for working
capital. Underwriter—Dean Witter & Co., San Francisco,
Calif.
;;
/

Savoy-Plaza is tendered.

(Monday)

Co._-__^

(Bids

-

Higglnson

Bisseli

Laird,

Co.;

1956

each four shares held.
.ment.

Hotels

January 7, 1957

Beauty Counselors Inc.

(12/28)

Nov. 29 filed 413,920 shares of common stock
(par $7.50)
to be offered for subscription by common
stockholders of

Plaza.

CALENDAR

(Friday)

common

common

unless at least

December 14

and; after Jan. 1, 1957. to
shares by exer¬

on

debentures into

fered in exchange for outstanding capital stock of
SavoyPlaza, Inc., at the rate of three shares of series A pre¬
ferred and three shares of common stock of Hiltbn

'Mi \

NEW

such

convert

and

Underwriter—Daniel Reeves & Co., Beverly Hills,
,

★ Hartford Gas Co., Hartford, Conn. *
11 filed 60,000 shares of common stock
(par $25),
issuable against conversion of
$1,500,Q00 3^2% 10-yejar 4
convertible debentures due July 1, 1965. Owners of the
Dec.

Proceeds—For

development. Business—Closed

'

holders. Underwriter—Van
Alstyne, Noel & *Co* New
York; and Johnston, Lemon & Co., Washington, D. C.
Offering—Postponed.

Dec.

300,000 shares of

Office—2553 Middlefield

Stares, Inc.
240,000 shares of common stock (pa* $1).
share. Proceeds—To certain selling stock¬

per

record Dec.

(12/17-19)

Price—At par ($1 per share).

research and

Wilson, Johnson & Higgins, San Francisco, Calif.; and

|

Finance

(letter oL notification)

stock.

r

Underwriter—

-.-.iv.'v.'-.*'

Consumer

Alstyne, Noel & Co., New York.

Lester, Ryons & Co., Los Angeles, Calif.
:

working capital.
Office—
St;,. Long -1sland City 1, N. Y. Underwriter

75,000. shares of 60-eent Convertible pre¬
ferred stock (par $10). Price—To be
supplied by amend¬
ment.- Proceeds<---To reduce bank loans. Underwriter—

Nov.

machinery and tools, and to increase inventories! and
other

held; rights to ex¬
(in denominations: of

par

Nov. %26 filed

supplied by •;

amendment,: Proceeds-r-Tp retire short-term

thereof

At

—

Hancock. Electronics Corp., Redwood
City Calif.

offered;fed®/^^U^

Price

Price

Proceeds—For

v."

Guardian

Van

:s^res:rifhco^

J ,'of which /23,b00 shares ^elto; be

each)

38-15 30th

.

attached>^and;33,000

-

fraction

or

—None.

Los

''■>;?

>; Nov. 23 filed $300,000 of

%

&

.

stock,

on-Dee. 28.

Price—$9

debentures will be entitled
-

debentures due Dec.

General Telephone Co. of California

^.

111

sales

promotions and operating capital.

Office—

No. Scenic

—Anderson

Highway, Lake Wales, Fla. Underwriter
Cook Co., Inc., Palm Beach. Fla.

Bonds
$12,000,000

,

Continued

on

page

112

\

Financial Chronicle

The Commercial and

Co., Inc.

Loyal American Life Insurance

Continued from page

Sept. 28 filed 230,000 shares of common stock (par $1)
to be offered for subscription by common stockholders

111

(12/18)

Rochester, N. Y.

9KDI Corp.,

7% participating cumula¬
tive preferred stock (par $5), of which 71,428 shares are
to be offered to public. Price—$7 per share
Proceedsfior machinery and equipment, working capital and other
corporate purposes. Underwriter
McDonald, Holman &
81,428 shares of

16 filed

Wov

Fund, Inc., Los Angeles, Calif.
#uly 30 filed 100,000 shares of capital stock (par $1), ot
which 9,300 shares will be initially sold at $10.98 per
rshare. Additional shares will be offered at a price equal
-io the net asset value of the Fund, plus a sales load of
Kerr Income

6%% of such price.

Proceeds—For investment.

Invest¬

California Fund Investment Co., of
which John Kerr is also President.
Kinney Loan & Finance Co.
jSept. 11 (letter of notification) $150,000 of 6% sinking
ffund capital debentures, series A, due Sept. 1, 1971. Price
—At par in denominations of $1,000 each.
Proceeds—
3For working capital. Office — 911 Tenth St., Greeley,
«Colo.
Underwriter—Wachob-Bender Corp., of Omaha
Manager

ment

—

Neb.

sand Lincoln,

Locomotive Works, Inc.

Machine &

Klamath

—None.

Cleveland, Ohio (12/17)
Nov. 21 filed $1,000,000 of 6% convertible debentures
due 1976.
Price—To be supplied by amendment. Pro¬
ceeds—To purchase machinery and equipment, to retire
indebtedness and for working capital.
Business—Aluxninum and chrome-plated kitchenware and
giftware.
Underwriters—Lee Higginson Corp. and P. W. Brooks &
Co. Inc., both of New York.
• Kromex Corp., Cleveland, Ohio
(12/17)
*Jov. 21 filed 130,000 shares of capital stock (par $1).
4Price—To be supplied by amendment. Proceeds—To sell¬
Kromex

Corp.,

Lee Higginson Corp.
of New York.
Libby, McNeill & Libby, Chicago, III.
3NTov. 9 filed $10,468,500 of 5% convertible sinking fund
debentures due Dec. 15, 1976, being offered for subscrip¬
tion by common stockholders at the rate of $100 of
debentures for each 35 shares held as of Nov. 29, 1956;
rights to expire on Dec. 17. Price—At par (flat). Pro¬
ceeds
To reduce bank loans. Underwriter — Glore

ing stockholders. Underwriters —
and P, W. Brooks & Co. Inc., both
•

—

Forgan & Co..

Chicago. 111.

Libby, McNeill & Libby, Chicago,
XJov. 9 filed 610,664 shares ol common

III.
stock (par $7)

being offered for subscription by common
at the rate of one new share for each six

stockholders
shares held

to expire on Dec. 17. Price—$12
Proceeds—To reduce bank loans. Under¬
writer—Glore, Forgan & Co., Chicago, 111.
of Nov.

as

29: rights

share.

per

South Carolina
Oct. 15 filed 339,600 shares of common stock (no par)
to be offered for subscription by stockholders of record
Life Insurance Co. of

1956 at the rate of two shares of new stock
held.
Price—To stockholders, $10 per

12,

Sept.

share

each

lor

®hare; and to

public, $15 per share.

Proceeds—For ex¬

pansion and working capital. Underwriter—None. Pub¬
lic offering will be made by employees of the company

qualified licensed dealers.

and

Inc.,

Electronics,

Ling

FJov. 5 filed

Los Angeles, Calif.
debentures due

$1,000,000 of 6% convertible

1,

Los Angeles, Calif.
Nov. 5 filed 183,333 shares of common stock (par 50
cents) to be offered for subscription by common stock¬
holders at the rate of one new share for each six shares
porate

Inc.,

Electronics,

share. Proceeds—For general cor¬
Underwriter — Perkins & Co., Inc.,
Offering—Expected this week.

Price—$3

held.

Lucky Stores, Inc.
Oct. 11 filed 630,000 shares of common

per

purposes.

Dallas, Texas.

most

Co.
of notification) 4,994 shares of common
stock (no par) being offered to stockholders on the
basis of one share for each 20 shares of record Sept. 24;
(letter

Price—$25 per share. Pro¬
company for additions to property

rights to expire Jan. 2, 1957.
ceeds—To reimburse
in Ohio

and

West Ninth

for

other

corporate

St., Lorain, Ohio.

purposes.

Office—203

Underwriter—None.

Macinar, Inc.
6tock (par 50 cents). Price—75 cents per share. Proceeds
—For general corporate purposes. Business — Manufac¬

.

Thursday, December 13, 1956

Proceeds —
Office—Portland, Me. Underwriter—Mc¬
Laughlin, Cryan & Co., New York.
Price—$12.50 per share.

surplus.

and

Price —I To be supplied by
Proceeds—Approximately $18,000,000 is to
1977.

15,

Feb.

Co.; to pay

Stores

acquisition

for

Dec.
1987.

4

filed

$20,000,000

of

first

Proceeds—For reduction of

(1/15)
mortgage
bank

program.

1957.




Underwriters—Goldman, Sachs
New York.

Lehman Brothers, both of

& Co. and

due
con¬

Underwriter—To be determined

23,279 policyholders on and as of July 31, 1956 at the rate
of 1^/2 shares of such stock and the balance of the shares
to

of common
stock (par one cent) and 100,000 stock purchase war¬
rants (each two warrants to entitle holder thereof to
purchase one share of Idaho Rare Minerals Corp. 6%
cumulative convertible sinking fund preferred stock,
par $10, and one share of Idaho Rare common stock, par
one cent at $11 per unit).
Price—$3 per unit, consisting
of one McRae share and one warrant. Proceeds — For
mining expenses.
Office—c/o Robert J. McRae, 1704
Gourley St., Boise, Ida. Underwriter—Von Gemmingen
& Co., Inc., 320 North Fourth St., St. Louis, Mo.
Michigan Wisconsin Pipe Line Co.

by National Life as a part or feature of
policies. Price—$7.50 per share.
Proceeds—For working capital and other coiporate pur¬
issued

bonds
loans

construction program. Underwriter — To be
by competitive bidding. Probable bidders:

for

determined

Halsey, Stuart & Co. Inc.; The First Boston Corp.;
Blyth & Co., Inc.
Bids—Three bids were received on
Aug. 1, all for 43/4s, but were turned down. No new date
for

bids

been

has

Midnite Mines,

set.

Inc., Wellpinit, Wash.

Wash.

Securities Corp., Spokane,

Inc., New York
June 22 filed 2,500,000 shares of common stock
(par
one cent).
Price—$1.50 per share. Proceeds—To acquire
for $2,400,000 the Chavin lead-zinc-copper-silver mine
located in South Central Peru, and for general corporate

•

Underwriter

Oct.

—

Gearhart & Otis, Inc., New

Offering—Postponed.

N. Y. (12/14)
convertible subordinated
Aug. 1, 1966, of which $100,000 principal
offered in exchange for outstanding 6%

Mohawk Airlines,

debentures due

amount will be

convertible
Proceeds

Inc.,

Ithaca,

$794,000 of 5V2 %

filed

26

notes.

For

—

Price

—•

general

writers—Mohawk Valley

100%

and

accrued interest.

corporate purposes.
Under¬
Investing Co.; Dempsey-Tege-

Co.; and Gregory & Sons.

it Murphy

National Old Line Insurance Co.

(A. A.) & Co., Inc., St. Paul, Minn.

6,000 shares of 6% prior
preferred stock. Price—At par $50 per share). Proceeds
—To reduce bank loans and for working capital. Under¬
(letter of notification)

3

writer—Piper, Jaffray & Hopwood, Minneapolis,

Minn.

By-Products, Inc.
(letter of notification) 2,000 shares of common

19

stock

Des

Price—$5 per share.

(par $1).

Federal

estate

taxes.

Proceeds—To pay

Bankers Irust Bldg.,

Underwriter—T. C. Henderson & Co.,
Moines, Iowa.
Cash

(par $2) and 50,000 shares of class B common stock
(par $2). Price—To be supplied by amendment. Proceeds
—To selling stockholders. Office — Little Rock, Ark:
Underwriter — Equitable Securities Corp., Nashville,

Tenn., and
postponed.

9

filed

$28,170,500 412%

convertible subordinated

15, 1981, being offered for

subscrip¬

of record Dec. 4, 1956 at
of debentures for each 25 shares of stock

1956. Price—At par.
working capital to finance company's ex¬

held; rights to expire on Dec. 19,
Proceeds—For

panding volume of sales and the
customers'

accounts

receivable,

consequent increase in
to carry increased

and

inventories; also for improvement
plant

and

other

Offering

York, N. Y.

—

Indefinitely-

V

stock (par $1)
to be
stock of Lynn
Gas & Electric Co. cn the basis of two NEES shares
for each Lynn share. Dealer-Managers—Paine, Webber,
Jackson & Curtis and F. S. Moseley & Co., both o£
819,000 shares of common
offered in exchange for capital
filed

3

Boston, Mass.

:

•'

•

;

'

■•

*

Australia
(Electricity Commission of)
South Wales,

Oct. 26 filed

*

•

$

Price—To be

$7,500,000 sinking fund bonds.

supplied by amendment. Proceeds—To redeem $6,976,000
3V2% sinking fund bonds, of The Sydney County Council
due Jan. 1, 1957, the holders of which may exchange
same
for the new bonds; and for construction work.
Underwriter—Kidder, Peabody & Co., New York. Of¬

fering—Indefinitely postponed.

& Telegraph Co.

(letter of notification) 2,000 shares of common
stock to be offered for subscription by stockholders on

Nov.

14

Proceeds—For the

and

debts

other

Price—At
retirement of

basis.

one-for-five

a

additional

new

($100 per share).
short-term note and
plant. Underwriter—

par
a

None.
•

1

Northeast

Nov.

784,402

filed

20

Inc.

Airlines,

shares of

$1

par

value common:

of which approximately 45% of the shares are
being offered for subscription by common stockholders
of record Dec. 7, 1956, other than Atlas Corp. on a 4 for-5.
stock,

expire on Dec. 20); approximately
Atlas Corp.; and the balance of the
shares, or 50% of the offering, were on Dec. 12 offered
to the public.
Price—$9.50 per share. Proceeds — For
expansion of operations; toward payment of 10 aircraft
and related equipment; and for general corporate pur¬
to

(rights

5% of the shares to

Underwriter—Carl M. Loeb, Rhoades & Co., New
Atlas Corp. may purchase a portion of shares
stockholders which remain unsubscribed

poses.

York.

production

and replacement of

facilities.

Dillon, Reqd & Co. Inc., New York.

Underwriter—

City Pier Corp.,

Ocean

Berlin, Md.

$2,000,000 of 6% debenture bonds due July 2,
1976, and 4,000,000 shares of common stock (par one
cent) to be offered in units of one $100 bond and 200
shares of stock.
Price—$300 per unit. Proceeds — For
construction and operation of amusement pier. Under¬
writer
Paul Korns, a director, of Johnstown, Pa.
Lt. Col. James A. Grazier of Whaleysville and Ocean

Oct. 4 filed

—

City, Md., is Chairman

of the Board.

Ohio Power Co.

Sept. 20 filed 60,000

shares of cumulative

preferred stock
Under¬

(par $100). Proceeds—For construction program.
writer—To be determined by competitive bidding.

Prob¬

First Boston Corp.; Blyth & Co., Inc.;
Kuhn Loeb & Co.; Eastman Dillon, Union Securities & Co.
and Salomon Bros. & Hutzler (jointly); Harriman Ripley

able bidders: The

ly); Lehman

(EST) on Oct. 30 were

Orefield
Oct.

Webster Securities Corp. (joint¬
Brothers. Bids—The two received up to 11

Inc. and Stone &

& Co.,

rejected.

Mining Corp., Montreal,

15 filed 900,000

which 200,000

Canada

$1), of
Price—To be
For exploration

shares of capital stock (par

shares are now outstanding.

supplied by amendment. Proceeds —
costs.
Underwriter—To be named later.
panakis, of Miami, Fla., and Denis
Canada, are large stockholders.
it Pacific Power & Light

Michael TzoColivas, of Montreal,

Co. (1/9)

$20,000,000 of first mortgage bonds due 1987.
repay bank loans and for new construc¬
Underwriter—To be determined by competitive

Dec. 6 filed

Proceeds—To

tion.

Lehman

by common stockholders

the rate of $100

New

England Electric System

New

bidding.

Register Co.

debentures due Dec.
tion

Office—800

Moines, Iowa.

National

stock

filed 50,000 shares of class A common

Nov. 15, 1955

a.m.

(12/18)
Dec.

Underwriter—None.

poses.

by them.

of common
stock (par 10 cents). Price—$1.25 per share. Proceeds—
To go to selling stockholders.
Underwriter — Standard

purposes.

insurance

offered to other

(letter of notification) 223,980 shares

Nov. 6

life

certain

basis

July 2 filed $25,000,000 of first mortgage pipe line
due 1976.
Proceeds—To pay off short term bank
and

exchangeable for Founders certificates and cou¬

be

pons

Norfolk & Carolina Telephone

it McRae Tungsten Corp., Boise, Idaho
Nov. 30 (letter of notification) 100,000 shares

Nov.

bonds

loans and

by
competitive bidding.
Probable bidders: Halsey, Stuart
& Co.
Inc.; Equitable Securities Corp. and Eastman
Dillon, Union Securities & Co. (jointly); Kuhn, Loeb
& Co.; Blvth & Co., Inc.; Merrill Lynch, Pierce, Fenner
& Beane, Kidder, Peabody & Co. and Harriman Ripley
& Co. Inc.
(jointly); Salomon Bros. & Hutzler; The
First Boston Corp., and Glore, Forgan & Co. (jointly);
White, Weld & Co. and Shields & Co. (jointly). Bids
—Expected to be received up to noon (EST) on Jan. 15,
struction

or

existing indebtedness to parent and
construction of additional properties

to parent.

be leased

to

be used to

Mitchell, S. Dak.

National Life of America,

Sept. 21 filed 86,784.7 shares of common stocK (par $5)
to be offered for subscription by each of the company's

bonds due

amendment.

parent, The May Department

purchase properties from

Inc., Des

Light Co.

St., Spartanburg, N. C.

New

May Stores Realty Corp. (12/17-21)
Nov. 23 filed $25,000,000 general mortgage

Office—314
Underwriter—None.

Proceeds—For working capital.

share.

Pine

•

inventory and working capital.
Underwriter—
Quincy Cass Associates, Los Angeles, Calif.

ment,

Power &

(12/20)
(par $5).
To increase capital

of capital stock

shares

99,500

filed

28

per

Dec.

Y.

Fidelity Fire & Casualty Co.

Maine

stock

J.

York 17, N.

Nov.

^-National Fidelity Insurance Co.
(letter of notification) 33,000 shares of common
(par $1.25) to be offered to stockholders on the
basis of one share for each seven shares held. Price—$8
Nov. 30

and aluminum specialty products. Under¬
Montague, Inc., 15 William Street, New

steel

writer—C.

June

filed

Louisiana

notification) 400,000 shares of common

July 23 (letter of

Co.
$500,000 of 6% convertible subordinated
debentures due Aug. 1, 1971. Price—At par (indenominations of $500 and $1,000 each). Proceeds—For equip¬
11

over-subscription

an

National

Los Angeles Drug

Oct.

(with

held

stock

common

privilege);
rights to expire on Dec. 17. Price —
$11.25 per share.
Proceeds — To Foremost Dairies,
Inc., the selling stockholder. Office — San Leandro,
Calif. Underwriters—Allen & Co., New York, and Dean
Witter & Co., San Francisco, Calif.
'

ler &

1

stockholders

In the ratio
Stores share for each 12 V2 shares of Fore¬

of one Lucky

Lorain Telephone

Oct.

stock (par $1.25)

being offered for subscription by common
of Foremost Dairies, Inc. of record Nov. 30.

York.

this week.

Ling

an

Minerals,

1966. Price—100% and accrued interest. Pro¬
ceeds—For general corporate purposes.
Underwriter—•
Perkins & Co., Inc., Dallas, Texas.
Offering—Expected

Dec.

(with

Montgomery, Ala.

Farish,

&

tures

notification) $210,000 of participating
.pinking fund debentures due Nov. 1, 1971 (with fixed
interest of 6Vz% and contingent interest of an additional
1%%). Price—At face amount (in denominations of $500
and $1,000 each). Proceeds—For general corporate pur¬
poses. Office—720 N. State St., Ukiah, Calif. Underwriter
(letter of

Kov. 29

share for
oversubscription privi¬
lege). Price—To be supplied by amendment. Proceeds
—To increase capital and surplus.
Underwriters—J. H.
Goddard & Co., Inc., Boston, Mass., and Thornton, Mohr
15, 1956 at the rate of one new

of record Oct.

each three shares held

York.

Co., Inc., New

•

.

.

(2603)

112

Bros.

&

Probable bidders: Halsey, Stuart & Co. Inc."
Bear, Stearns & Co. and Salomon;
Hutzler (jointly); Blyth & Co., Inc. and WhiteH
Brothers,

(jointly); Eastman, Dillon, Union Securities
Peabody & Co. Bids—Expected to be re¬
to 11 a.m. (EST) on Jan. 9.

Weld & Co.

& Co.; Kidder,

ceived up

Light Co. (1/9)
preferred stock (par
$100). Proceeds—For construction program. Underwriter
—May be determined by competitive bidding. Probable
bidders: Lehman Brothers; Blyth & Co., Inc.; Eastman
Dillon, Union Securities & Co.; Kidder, Peabody & Co;
Bids—Expected to be received up to li a.m. (EST) onj
it Pacific Power &

Dec. 6 filed

Jan. 9.

90,000 shares of serial

Volume

184

Number

5594

.

.

The Commercial and Financial

.

Chronicle

(2609)
Pari-Mutuel

Aug.

24

mon

(par $1).

construction
of 40

Equipment Corp.
of notification) 60,000 shares of com¬
Price—$5 per share. Proceeds—For

(letter

stock

of

250

machines for

race

ticket

machines; for

issuance of semi-blank

purchase

race

tickets;

working capital and general corporate purposes.
Office—527 Madison Avenue, New York
17, N. Y. Un¬
derwriter—Wistor R. Smith & Co., 40 East 54th
New
,

York

Street,

22, N. Y.

Peerless

Oct.

8

stock

Life

Insurance Co.

(12/17-21)
11,500 shares of

(letter of notification)
Price—$25 per snare.

(no par).

general

corporate

Office

purposes.

—

common

Proceeds
1310

Bldg., 109 North Akard St., Dallas, Tex.
Newborg & Co., New York.
•

core

assays; for mining shaft; to exercise purchase of
option agreement on additional properties; lor
working
capital and other corporate purposes.
Underwriter

—

and for

Gulf

Indiana State Securities Corp. of
offering to residents of Indiana.

it Schuster
Dec.

3

stock

States

Underwriter—

lb

filed

50,000

vertible preferred

shares

stock

60-cent

cumulative

con¬

(par $5).

Price—$10 per share.
Proceeds—To reduce bank loans and for
working capital.
Office—Denver, Colo. > Underwriter—Paul C. Kimball
& Co.,
Chicago. Offering—Expected this week.
it Phoenix Engineering &
Manufacturing Co.
|iotification) 8,600 shares of common
stock o&which 557
Shares were sold to employees. Price
—At par ($10 per share).
Proceeds—For the purchase
Nov. 3(L (letter of

of additional

North 52nd

inventories and equipment.

St., Phoenix, Ariz.

Office

1320

—

Underwriter—None.

*

ing

stock (par

common

cents). Price—To be supplied by amendment
(pro¬
posed maximum offering price is $3.25 per
share). Pro¬
ceeds
To
construct
and
operate
two
multi-level
automobile
parking
structures,
utilizing
a
patented
mechanical device. Underwriters—A. G. Edwards &
Sons

Dempsey-Tegeler & Co., both

of St.

number

stock, represent¬
options

of

shares for which

be presently granted pursuant to the Stock
Option
Plan for key employees of the
company or its wholly-'
owned subsidiaries.
Southern

General Insurance Co.,
Atlanta, Ga.
Sept. 24 filed 95,714 shares of common stock (par
$5), of
which 50,000 shares are to be offered
publicly; 20,714
shares are to be offered in
exchange for 10,357 shares of
$10 par common stock of Progressive Fire Insurance
Co.;
and 25,000 shares are to be offered to certain other
per¬

Louis, Mo.

Offering—Date indefinite.

Southern New England

Sept.

basis of 2%

shares of Pittsburgh for
common
share.
The ofler, which has
effective, has been extended until 3 p.m.

Feb. 1, 1957.

on

ic Prince Marine Drilling & Exploration Co. (1/3)
Dec. 6 filed
$1,250,000 of 5xk% sinking fund debentures
due Jan. 1, 1969 and
125,000 shares of common stock (par
50

cents) to be offered in units

of $100 of debentures and

10

shares of stock. Price —$110
per unit.
Proceeds—To
acquire certain oil, gas and other mineral leasehold
pro¬

perties, including properties now producing gas and
oil;
to acquire
equipment; and for working capital. Office—
Houston, Tex. Underwriter—Shields & Co., New York.
•

Puerto Rican Jai

July

filed

27

Alai, Inc.

$1,500,000

of

Price

construction
San

Juan,

—

of

12-year

To

be

$500

fronton and

Puerto

Rico.

6%

first

per

mortgage
stock

(par
100 shares

unit. Proceeds

For

—

related

activities.
OfficeUnderwriters—Crerie & Co.,

Houston, Texas; Dixon Bretscher Noonan, Inc.,
Spring¬
field, 111.; and Aetna Securities Corp., New York, offer¬
ing—Date indefinite.

Pyramid Development Corp.,
Washington, D. C.
July 27 (letter of notification) 300,000 shares of common
stock

(par

reserved

10

cents), of which 25,000 shares

for issuance

upon

are

exercise of options.

to

to be

•"Oct.

(par $25)

offered for subscription by stockholders of record
1, 1956 at the rate of one new share for each eight

held; right to expire on Nov. 2. Price—$30 per
Proceeds—To pay advances from American Tele¬

Proceeds—To purchase real
property and
mortgage notes. Underwriter—Coombs & Co. of Wash¬

ington, D. C.
Pyramid Productions, Inc., New York
Sept. 27 filed 220,000 shares of common stock

(par $1),
public and

of which 200,000 shares

are to be offered to
20,000 shares issued to underwriter.
Price—$5 per share.
Proceeds—To retire $125,000 of
outstanding 15% deben¬
tures as well as a $173,180 debt to
Trans-Union Produc¬

Inc.;

vision

releases.

and

York.

phone & Telegraph Co. (approximately $15,800,000) and
property additions and improvements. Underwriter

Oct.

4.

Offering—Delayed indefinitely by

company

on

(See also next paragraph.)

Southern New England Telephone Co.
Sept. 19 filed 1,173,696 rights to purchase 146,712 shares
new capital stock
(par $25) to be issued to American
Telephone & Telegraph Co., which owns 21.61% of the
of

outstanding stock of Southern New England Telephone
Co. Proceeds—To American
Telephone & Telegraph Co.
Underwriter—To be determined by competitive
bidding.
Frobable bidders: Blyth & Co., Inc.;
White, Weld & Co.;
Putnam & Co.; Chas. W. Scranton &
Co., and Cooley &
Co. (jointly); The First Boston
Corp.; Salomon Bros. &
Hutzler.

Bids—Had

11

(EDT)

a.m.

been

Oct.

on

expected to

10.

(See

be received up

also

preceding

to

para¬

A.

P.

Ex¬

Scott,

Underwriter—None.

Texas

Fuel Corp., Clarksville, Texas
(12/14)
(letter of notification) 120,000 shares of com¬
(par $1). Price—$2.50 per share. Proceeds—
To pay bank loans,
financing of time payment saley
of
appliances and air conditioners and for working,
capital.
Underwriter—Franklin Securities Co., Dallas,

Nov.

mon

29

stock

Texas.

"

Theatrical
Oct.

30

Interests

filed

52,000

Plan,

shares

of

'

Inc.,
class

York

New

A

City

stock

(par five;
cents) and 28,000 shares of class B stock (par five cents).
Price—Of class A, expected at $10 per share in lots ot
not less than 25

ceeds—For
fields.

shares; of class B, expected at

investment

Business—A

in

theatrical

and

Pra-.

par.

entertainment,

non-diversified closed-end

ment investment company.

manage¬

* Underwriter—None.

Thermoray Corp.
(letter of notification) 380,000 shares of com¬
stock (par 10 cents).
Price— 75 cents per share.
Proceeds—For inventory, working capital, etc. Business/

Title

Guarantee & Trust Co., New York
filed 61,902 shares of capital stock (par
$8) of.
35,750 shares are to be offered for subscription
by stockholders on the basis of one new share for each
eight shares held; and the remaining 26,152 shares are?

Nov.

21

which

to

be

offered, together with cash, in exchange for stock

of

Abstract & Title Insurance Corporation of Buffalo.
Rochester and Lockport, N. Y., on the basis of $15.25 in
cash and 4/10ths of a share of Title Guarantee stock in

exchange for each share
offer

Title

to

tive

if

Abstract

of Abstract.

Guarantee

latter

The

stockholders

subscription

becomes

acquires at least 85%
purchase offer will expire

stock.

The

effec¬

of

company

th3

Jar.

on

10, 1957, unless extended to Feb. 28, 1957. Price—To be
Proceeds—To acquire Abstract

supplied by amendment;
stock.

Underwriter—None.

/

it Tower Acceptance Corp., Houston, Tex.
Dec. 7 filed 200,000 shares of class A

common stock (par
$1). Price—$5 per share. Proceeds—For working capita*.
Underwriter—S. D. Fuller & Co., New York. Offering-

Expected sometime in January.
Trans-Canada

Southern

Union Oils Ltd., Toronto, Canada
24 filed 750,000 shares of capital stock (par $1).
Price—64^ cents per share. Proceeds—To selling stock¬

Aug.

holders.

Underwriter—None.

for working capital.
Business—Tele¬
Underwriter—E. L. Aaron & Co., New

Nov.

26

filed

debentures
stock

unit.

Co.

Sept. 27 (letter of notification) 40,000 shares of common
stock.
Price—At par ($7.50 per share). Proceeds—For
purchase of new equipment and working capital. .Office

In

Lines,

Pipe

1986

and

(par $1-Canadian)

and five shares of stock.

Proceeds—For

United

Ltd.

(Canadian) of subordinated
4,000,000 shares of common
to be offered in units of $100

$80,000,000

due

of debentures

Southwest Grease & Oil

States:

new

Price—$150

construction.

Lehman

Brothers,

per-

Underwriters—

Stone

&

Webster

Securities Corp. and

Small-Milburn

White, Weld & Co. In Canada: Ner>~
Ltd.; Wood, Gundy & Co. Ltd.;
McCloud, Young, Weir & Co., Ltd.; and Osier, Ham¬
mond & Nanton, Ltd.
Offering—Expected in the lairt

Herrick

half of January.

—220 W. Waterman

St., Wichita 2, Kan. Underwriters—
Co., Inc., Brooks & Co. and Lathrop,
dinger, Inc., all of Wichita, Kan.

&

be

Price—

$1 per share.

tions,

Proceeds—To

the"

on

Stock

graph.)

bonds due 1968, and
300,000 shares of common
$1) to be offered in units of a $500 bond and
of stock.

(par 25

time

Underwriter—Eaton & Co., Inc., New York.

Telephone Co.

19 filed 679,012 shares of capital stock

share.

Pocahontas

(EST)

to

Toronto

—Electrical heating. Office—26 Avenue B, Newark, N. *V

At¬

for

declared

time

the

lanta, Ga.

Robinson-Humphrey Co., Inc.,

—

—None.

been

by

or

mon

tas Fuel Co.

each

or

the selling stockholder.
•

from

Exchange
private sale.

June 29

filed 2,678,697 shares of common stock
(par $1)
being offered in exchange for common stock of Pocahon¬
the

change

market

Stock

Price—To public, $14.50 per
share; and to certain
$13 per share.
Proceeds—To pay bank loan.
Underwriter
The

shares

Coal Co.

Oct. 3

on

Price—At

American

may

—

Pittsburgh Consolidation

Proceeds—To go to

bitt

Tri-State

Southwestern

Resources, Inc., Santa Fe, N. M.
1,000,000 shares of common stock (par 25
cents). Price—$5 per share. Proceeds—To exercise op¬
tions, purchase additional properties and for general
corporate purposes.
Underwriter—Southwestern Secu¬
rities Co., Dallas, Texas.
June

filed

8

Southwide Corp., Anniston,

Sept. 12 filed 450,635 shares of
of which

shares

211,681 shares
to

are

be

in

offered

Ala.
stock

common

(par $1),

to be offered publicly 238,954

are

exchange

class A
Capital Fire & Casualty Co. and common stock
Allied Investment Corp.
Price—$2 per share.
Pro¬
ceeds—For purchase of stock of Capital and Allied firms
and for purchase of U. S. Government bonds. Under¬
stock

for

the

of

of

Thomson

&

Co.

Rock

Material

Corp.,

Leesburg,

Va.

Nov. 28 filed 500,000 shares of 6% cumulative convertible

preferred stock.
ceeds

—

For

Price—At par ($1.50 per share). Pro¬
asphalt plant, equipment, working capital

and other corporate purposes.

Underwriter—None.

Tyrex Drug & Chemical Corp.
Nov. 5 (letter of notification) 150,000 shares of class A
stock (par one cent).
Price—$2 per share. Proceeds—
For equipment, raw materials, working capital and other
corporate purposes.
Office—42 Newark St., Hoboker^
N.

J.

N.

J.

Underwriter—Dennis

Securities

Corp.,

Hoboker.>r

150,000 shares of common
stock
(par 10 cents). Price—$2 per share. Proceeds—
To purchase plant and
equipment. Office—2505 Butler
Place, New York City. Underwriter—Hopp & Co., Pas¬
saic, N. J.
Marie

Reid, Inc. (12/14)
Nov. 26 filed 250,000 shares of commoji
stock (par $1),
of which 80,000 shares are for
account of company and
170,000 shares for selling stockholders. Price
$9
per

—

share. Proceeds—To increase
inventories, finance expan¬
sion and for
working capital and other corporate pur¬

Business—Manufacture

poses.

Office—Los
Noel
•

&

St.

Angeles, Calif.
Co., New York.

and

sale

of

swim

Underwriter—Van

suits.

Alstyne,

Oct.

26 filed 750,000 shares of common
stock
(par $5)
being offered in exchange for outstanding common stock

(par $10) of J. Neils Lumber Co. at rate of 2V2

pire

common

share.

St. Regis

The offer will

ex¬

Dec. 31, 1956, unless extended. Exchange Agent
—The First National Bank of
Portland, P. O. Box 3457,
on

Portland,

Ore.

Samson Uranium,
Inc., Denver, Colo.
Aug. 21 (letter of notification) 25,000,000 shares of
capi¬
tal stock. Price—At
par (10 cents per share).
Proceeds
—For

core

drilling,

including geological research




indefinite.

selling commission will be allowed
to dealers for sales effected by them.
Elvin C. McCary,
of Anniston, Ala., is President.
a

Oct.

29 filed

400,000 shares of 5%

convertible preferred

stock

(par $5). Price — To be supplied by amendment
(proposed maximum offering price is $6 per share). Pro¬
ceeds—Fpr construction costs. Office—Montreal, Canada.
and

Cowen

Blosser

Straus,

&

&

& Lunt, Buffalo, N. Y.; Allen &
Co., both of New York, N, Y.: and
McDowell, Chicago, 111.
Offering—

Temporarily postponed.
•

Sunrise

Dec.
per

3

Fund, Inc., New York, N. Y.

filed

share.

500,000

shares

Proceeds—For

of

capital

stock.

investment.

Price—$5

Business—Pres¬

ently is

a

come

open-end company in March, 1957. Distributor—

an

Sunrise

closed-end investment company

Capital

Corp.,

37-12

84th

St.,

but will

Jackson

and

it Syndicate West End Avenue Corp.
4 (letter of notification) $84,500 of 10%

Dec.

debenture notes due Jan.
mon

note

stock

and

(par

one

$1)

to

be¬

Heights

registered

1, 1977 and 169 shares of

be

offered

share of stock.

in

units

Price—$501

of

one

com¬

$500

unit. Pro¬
ceeds—To acquire property.
Underwriter—None. Offer
to be made through Management
Syndicate Corp., 15
William St., New York 5, N. Y.
Teachers
Nov.

8

Mutual

Fund

of

per

California,

Inc.

filed

be offered

Universal

Lithium Corp.,

Washington,-D. C.

Nov. 15 filed 1,320,000

72, L. I., N. Y.

Regis Paper Co.

shares for each Neils

Underwriters—Hamlin

writer—None, but

Spar-Mica Corp., Ltd.

Redi-Food Co., Inc.
(letter of notification)

Oct. 8

Rose

United States Air Conditioning Corp.
Sept. 27 filed 600,000 shares of common stock (par 15
cents), of which 50,000 shares are to be offered to em¬
ployees, distributors and dealers; 50,000 shares, plus
any of the unsold portion of the first 50,000 shares, are
to be offered to the public; and the underwriter will be
granted options to acquire the remaining 500,000 sharts
for reoffer to the public. Price—At market prices. Pro¬
ceeds—For working capital and general corporate purposes. Office—Philadelphia, Pa. Underwriter—Mortimer
B.
Burnsiae &
Co., Inc., New York. Offering—Date

Co.

• Race & Race. Inc., Winter Haven, Fla.
29 (letter of
notification) $300,000 of 6% convert¬
ible debentures due Dec.
15, 1966 to be offered in units
of $100.
Price—At face amount. Underwriter—None.
Nov.

•

-

Calgary Co., Abilene, Texas

persons,

25

and

common

stock which may be
purchased under the Plan.
5 filed 500,000 shares of common

the maximum

per share.
Proceeds—
Office—Los Angeles, Calif. Underwrites

sons.

Pigeon Hole Parking of St. Louis, Inc.
Oct. 29 filed 300,000 shares of class A

Price—At market.

Texas

•

cents).

it Scott Paper Co., Chester, Pa.
Dec. 5 filed 10,500
membership in Employees' Stock Pur¬
chase Plan for 1957,
together with 54,585 shares of com¬
Dec.

of

(par $10).

Price—Initially at $7.14

For investment.

—None.

Sept. 25 filed 3,700,000 shares of capital stock

&

Co., Inc.
notification) 2,000 shares of

of

selling stockholders. Office—2153 N. 3rd St.,
Milwaukee,
Wis.
Underwriter—Robert W. Baird & Co., Inc., Mil¬
waukee, Wis.

mon

Peoples Finance Corp.

Nov.

(Ed.)

(letter

families.

,

Indianapolis, Ind., for

For

—

113

700,000 shares of capital stock (par $1) to
only to members and employees of the Cali¬

fornia Teachers Association

(Southern section) and their

shares of class A voting stock and
1,587,500 shares of class B non-voting stock.
Price—
Six cents per share.
Proceeds —For drilling program,
and for plant and equipment for rendering ore market¬
able.
Underwriter
William O'Connor, Secretary <f
—

of Arlington, Va. Malcolm W. Ater, of FaL's
Church, Va., is President, and Robert G. Baumann. d'
Ritchie, Md., is Treasurer. Statement to be withdrawn

company,

Venezuela
Diamond
Mines, Inc., Miami, Fla.
Aug. 3l filed 1,500,000 shares of common stock. Price—
par (20 cents per share).
Proceeds—For exploratitTi

At

and

mining operations in Venezuela. Underwriter—Co¬
Co., Inc., of Florida, Miami, Fla.

lumbia Securities

Venture

Sept.

4

Securities

Fund, Inc., Boston, Mass.

filed

200,000 shares of capital stock (par $1>.
Price—Initially at $25 per share. Proceeds—For invest¬

ment.
eral

Underwriter—Venture

Securities

Corp., 26 Fed¬

St., Boston, Mass.
Continued

on

page

114

The Commercial and Financial Chronicle

(2610)

114

Continued jrom page

Brazos

113

Industrial Corp.

+ Wallin

shares of common
stock.
For cur¬
rent liabilities, and for working capital and general cor¬
porate purpose. Business—Coftee-making machine. Of¬
5

Dec.

(letter of notification) 5,000
Price—At par $10 per share).

None.

son,

Gas Co.

shares of common

Price—50 cents per share. Proceeds
—For development of oil and gas.
Office—Felt Blag.,
Salt Lake City, Utah.
Underwriter—Us-Can Securities,
Inc., Jersey City, N. J.
stock

(par 10 cents).

Wheland Co.,

Chattanooga, Tenn.

May 23 tiled $2,00u,uuu oi convertible subordinated de¬
bentures due June 1, 1976, and 136,000 shares of common
the company's account and 61,000 shares for a selling
stockholder.
Price — To be supplied
by amendment.

Nov.

Proceeds—Together with proceeds from private sale ol

to

$900,000 ol

of

$1,500,000

43/4%

first

and

bonds

mortgage

3-year unsecured 4^2% notes to a group of names, will
be used to retire outstanding series A and series B b%

expansion program. Under¬
writers—Hemphill, Noyes 6c Co., New York; Courts &

first mortgage bonds, and for

$15,000,006

it

16

reported

was

Carolina P. U.

its

stock

common

the basis of

on

ceeds—To

Price—At par

reduce bank

Southern

Underwriter—None.

Co.

graph

in

face

Proceeds

amount.

For

—

& Division

Office—Main

improvement

At
hotel.

—

to

Streets, Salisbury, Md. Under¬

(of

mountain

Mass.
Aug. 13 filed $800,000 of 6% subordinated cumulative
debentures due Dec. 1, 1976, and 6,000 shares of common
stock (no par) to be offered in units of a $400 deben¬
and

ture

three

shares

a

Proceeds—For

stock.

construction

ness—Mountain

recreation

Price

—

$500 per unit.

and

working capital. Busi¬
center.
Underwriter—None;

offering to be made by officers and agents of
•

William

Nov.

30

Penn

(letter

company.

Finance

Corp.
notification) $250,000

of

of 6% sub¬
ordinated renewable debentures due Dec. 20, 196o. Price
face

—At

Proceeds—To

amount.

debtedness

to

indebtedness.

Factors

Corp.

Office—2829

N.

outstanding in¬

repay

of

America

other

and

Broad

St., Philadelphia,
Pa.
Underwriters
Walnut Securities Corp., Philadel¬
phia, Pa.; and B. Ray Robbins Co., New York, N. Y.
—

28 filed

bentures

due

1976.

Proceeds

ment.

20-year sinking fund de¬
Price—To be supplied
by amend¬

$20,000,000

of

To
redeem
presently outstanding
bonds, to repay bank loans and for ex¬
program.
Business—Meat packing firm.
Un¬
—

58,310 shares
share for each

Bell

per
new

share).

Pro¬

construction.

Telephone

& Tele¬

its rights to 14,464
to stockholders) to

Bids

expected

are

27 for the

Dec.

by

the

company

bidders:

Probable

Co. Inc.; Salomon Bros. &

Halsey,

Stuart

&

Hutzler.

and Irwin Jacobs & Co. of Chicago) plans a public
offering of $1,000,000 class A 6% participating convert¬
ible stock (par $1). Underwriter—Baker, Simonds & Co.,
Detroit, Mich. Offering—Expected in February.

^American Natural Gas Co.
Dec.
10, it was announced company
442,114 additional shares of common

proposes

rights offering to its

the

the

stockholders

share for each 10 shares held.

new

market.

derwriter

Proceeds—For
To be

on

stock

to

sell

through

basis

of

a

one

(1/22)
Bids

are

program.

Un¬

Probable bidders:

Appalachian Electric Power Co.
May 31 it was announced company plans to issue and
sell in December $24,000,000 of first mortgage bonds.
Underwriter—To be determined by competitive
bidding.
Probable bidders: Halsey, Stuart & Co.
Inc.; Union Secu¬
rities Corp. and Kuhn, Loeb & Co.
(jointly); The First
Boston Corp.; Harriman Ripley &
Co., Inc.
Associated Truck JLines, Inc.- - ...
Oct. 11 it was announced corporation

<

plans to issue and
$1,000,000 of 6% convertible subordinated debentures
due Oct. 1, 1971 at par and
75,000 shares of common stock
rPar $3) at $11 per share (the latter for the account
oi selling stockholders). Proceeds—From sale of
deben¬
tures, for expansion and working capital. Business—A
sell

short

haul

motor

common

carrier

operating over
miles or routes in Illinois,
Indiana, Michigan and
Office—Grand Rapids, Mich.
Underwriter—Paine,
ber, Jaickson & Curtis, Boston, Mass., and New
N.

Y.

until

Web¬
York,
Probably not

January.
are

Coast

Line

RR.

(12/18)

to be

received by the company on Dec. 18 for
from it of $5,340,000 equipment trust cer¬

Bayless
it

(A. J.)

was

group

bustoii

CO.,

the

on

will

Luxemoourg

of

consisting

that

to

depend

Freres

the possibility

stuuy

American

of

American bank- '

Co., Tne First'

6c

Co.

6c

time,

has

loan

a

to

been

ap¬

issued"'

be

amount

terms'

and

Proceeds

conditions.

mamet

on

The

nictrKet.

an

Loeb

Kunn,

Hazard

and

oorp.

pointed

—

oe~

To

loanea

to

coking plants, power plants and iron ore mines.I

firms

Household
Dec. 3 it

was

issue

an

of

Community for expansion of coair

tne

in

Finance

Corp.

;

NO

:

•//■'■•5

•

reported company may register this

month'/

$oO,000,000

long-term ueoentures. Under-writers
Lee Higginson Corp. and While, Weid 6c Co.,. 1
botn of New Vonc; and William Blair &
Co., Chicago, 111.
Offering—Probably early in January.
it Hubs..man Factors corp., New York
Dec.

10 it

Jan.

22

,

Electric

Cleveland

Illuminating Co.
company plans to issue and sell
$25,000,000 of first mortgage bonds in the Summer of
1957.
Proceeds—To repay bank loans and for construc¬
tion program. Underwriter—To be determined by com¬
petitive bidding. Probable bidders:
Halsey, Stuart &
Co. Inc.; The First Boston Corp.; Blyth & Co., Inc.; Dil¬
lon, Read & Co. Inc.; Blair & Co. Inc., and Baxter, Wil¬
liams & Co.
(jointly); Glore, Forgan & Co.; White,
12 it

Nov.

Weld

reported

was

Co.

&

27

it

was

announced

to its stockholders

f

is planning

issue of approximately $55,000,000 of convertible debentures early in 1957; probably the
latter part of February. They will be offered to common
stockholders for subscription. Stockholders will be asked
on Feb. 5 to approve an authorized issue of
$125,000,000
company

an

Proceeds—For construction pro¬

Underwriter—May be determined by competitive
bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
Morgan Stanley & Co.; The First Boston Corp.

gram.

Consolidated
Nov.

21

it

Freightways,

announced

was

Interstate Commerce

Inc.

company

Commission for

Continental

common

was

authority to issue

stockholders

additional
For

Copper & Steel
announced

common

construction

the

stock

on

program.

New York.

Industries, Inc.
plans to offer to its
to subscribe for some

a

l-for-10 basis.

Proceeds—

Underwritre—Allen

&

Co.,

.

19, Donald W. Douglas, President, announced that

the company plans to issue and sell $25,000,000 convert¬
subordinated debentures.
Proceeds—For expansion

ible

of facilities in order

to place the DC-8 jet airliner into
Underwriters—Merrill Lynch, Pierce, Fen¬

production.
ner

& Beane and

Kuhn, Loeb & Co., both of New York.
Offering—Not expected until after Jan. 1, 1957.

Eversweet, Inc.
Oct. 15 it

was

-»

jcrice—Expected

Siocr.

Underwriter—ii.

ivi.

to

oe

Byaesby 6c.

'

foiK and cnicago.

Fower

plans contemplate

&

Co.

Ligiit

some

tune

issue of $6,000,ooo of" preferred,

an

i957

in

if

market

conditions

it

make

bank

reported that this company (a consolida¬

will

rities

to

available

are

for

ana

be

to

neeu

sold

in

$14,000,u00.

approximately

loans

and

probably

will

be

new

1959

and lyou, amounting
Proceeds—To repay bamc'.

construction.

:

be

Underwriter—May

Lenman Brothers, Goldman, Sachs 6c Co. and Tne First'Boston Corp., wno underwrote last equity financing.
Interstate Fire &

Sept. 26 it

was

6c

Co.,

snares

common

of

Louis,

St.

'

Casualty Co.

reported company plans to

75,000 additional
—White

Mo.

issue and sell.;

stoat.

Offices

—

Underwriter
Cnicago

•

and'

/

Bloomington, ill.

Jersey Central Power & Light Co.
Sept. 12, it was announced company plans to issue andJ

$8,000,000

To

be

of first mortgage

determined

by

:

Underwriter!
bidding.
Probable, '

bonus.

competitive

bidders: Halsey, Stuart & Co. inc.; Kidder, Peaoody &:
Co.; The First Boston Corp.; Wnne, Vveiu cc ho.; Hast-)
man
Dillon, Union Securities 6c Co., Salomon Bros. 6cl
Hutzler and Merrill Lynch, Pierce, renner
N:
joeane;o
(jointly).

Kaiser

Industries,

Inc.

:

v

Nov.

28, E. E. Trelethen, Jr., Executive Vice-President,>'
stated that it is anticipated that a portion of tne funds;
to meet tne $25,000,000 installment due April-

necessary

its 4^4% term loan.may nave to be proviued.;
by the creation oi debt by, or the sate of equity securi-1, 1957

on

Henry J. Kaiser Co., or
sale of a portion of the
owned by tne Henry d.
Kaiser Co., or of certain other assets. Underwriter—The ~
JbTrst Boston Corp., New York.
ties,

this

of

corporation

-

or

the public or private

through

of

securities

the

companies

Long Island Trust Co., Garden City, N. Y.
<
v.
was announced stockholders or record Nov. 16,i

Nov. 28 it

1956, are being offered the right to subscribe- on or be¬

14, 1956, for 14,000 additional shares of capital,
on the basis of one new share for each
eight shares held. Price-^-$32 per share. Proceeds—TO;
fore Dec.

stock

(par $10)

increase
aer

,

Underwriter—A. xvl. Kia-

capital and surplus.
Co., New fork.

6c

Metropolitan Edison Co.

July 2 it was reported that company is considering the
sale of $10,000,000 first mortgage bonds due 1986. Under¬
writer—To be determined by competitive bidding. Prob¬

-

bidders: Halsey, Stuart & Co. Inc.; White,

Weld &;
Co. and Drexel
Bids—Not ex-pecteri to be received until May, 1957. Company pres-''
ently plans to issue and sell $22,000,000 of bonus in the
Co.: Blyth & Co., Inc.; Kidder, Peabody &
& Co. (jointly); The First Boston Corp.

16 months.

next

Missouri
Bids

are

Pacific

RR.

(1/10)

expected to be received by the company on Jan.

10 for the purchase from

it of $4,875,000 eqtlipfnent trust

certificates. Probable bidders: Halsey, Stuart & Co. Inc.;
Salomon Bros. & Hutzler.
-

tion of Vita-Fresh

Mountain

Corp. and John H. King & Co.) plans
early registration of 100,000 shares of common stock.
Price—$5 per share. Business—Producers of fresh orange
juice. Underwriter—Burton J. Vincent & Co., Chicago,

sell

111.

loans

«

loans

utilized,| during at least part of 1957. Additional secu¬

able

•

Douglas Aircraft Co.
Nov.

Inc., New

ent

company

right

per

Indianapolis

has applied to the

and sell 250,000 shares of common stock (par $5). Pro¬
ceeds—Together with funds from sale of up to $8,436,740
long debt securities, to acquire six Eastern lines. Under¬
writer—Blyth & Co., Inc., New York and San Francisco
(Calif.).

Nov. 28 it

'

Nov. zi, H. T. Prichard, President, announced that pres-,

seil

Light & Power Co.
company will probably offer
early in 1957 some additional common
stock, to finance part of its construction progrjam. Under¬

Nov.

common

$6.80

V /

reported company plans to issue and sell-

was

snare.

States

Telephone

& Telegraph

,

Co.

(1/2,9)
Nov.

be

20

the

directors approved

$35,000,000 debentures.
for

and

determined

construction

a proposal to issue and
Proceeds — To repay bank
program.
Underwriter—To

;

Markets, Inc., Phoenix, Ariz.
reported company plans to issue and sell

750,000 shares of common stock. Underwriter
H. M.
Byllesby & Co., Inc., Chicag.o 111. Registration—Planned
in January. Offering—Expected in
mid-February.




Tegen, President, announced that the
are
going to be offered approximately
647,000 additional shares of common stock (par $5) on

competitive bidding. Probable bid¬
ders: Halsey, Stuart & Co. Inc.; The First Boston Corp.;
Morgan Stanley & Co.; Drexel & Co. and Dean Witter;
&
Co.
(jointly).
Bids—Expected to be received on
Jan.

•

General

Nov.

15,

Public

A.

Utilities Corp.

F.

stockholders

one

new

share for each 15 shares held

on

or

about March

the purchase
tificates, series K, to be due annually from Jan. 1, 1958
to Jan.
1,1972, inclusive. Probable bidders: Halsey, Stu¬
art & Co., Inc.; Salomon Bros. & Hutzler.
Nov. 27

1

the basis of

Offering—Indefinitely postponed.

Atlantic
Bids

3,300
Ohio.

6c

'

$a,-(

approximately

>

^\i

mis Auuioriiy announced

porary

.

expected to be received by the company on
for the purchase from
it of approximately

$4,000,000 equipment trust certificates. Probable bidders:
Halsey, Stuart & Co. Inc.; Salomon Bros. & Hutzler.

Price—To be under

construction

determined

by competitive bidding.
White, Weld & Co. and Drexel & Co.
(jointly); Blyth & Co., Inc.; The First Boston Corp.
Offering—Expected early in 1957.
—

ing

j

,

Authority of the European Coal and Steel/

oommunuy,

t

stocK

Cincinnati, New Orleans, Texas & Pacific Ry.

convertible debentures.

★ Advance Mortgage Corp., Chicago, III.
4 it was reported this company (to be surviving
corporation following merger of First Mortgage Corp.

1

feasible, and an issue oi $8,000,0u0 in bonus in 19o8. Tern-,

Consolidated Edison Co. of New York, Inc.
Nov. 20, Charles B. Delafield, Vice-President, announced

Dec.

be

lork.

July 9

on

writer—None.

Prospective Offerings

will

luvestment

s

Underwriter—Probably Kidder, Peaoqay

High

Co.

purchase from it of $4,200,000 equipment

certificates.

trust

received

be

to

(12/27)

pansion

Indefinitely postponed.

Co.

200,000 shares of

Co.

&

first mortgage

derwriters—Smith, Barney & Co.; Giore Forgan & Co.
and Hallgarten & Co., all of New York City. Offering—

'J

.

lem-y

approved oy me directors oil Aug. io, will
be rinaacea oy a deoeniure issue. Hawaiian

ii

a,uu,

be prooaoiy

{he

Connecticut

Wilson & Co., Inc.

Aug.

Ldwic

around

R. S. Dickson

Corp., Boston,

of

for

February, 1956, sold
66,640 share offering

writer—None.
Wildcat

($100

loans and

^ Chesapeake & Ohio Ry.

Price

new

one

Ttnepnone &c

American

wilii

j

«:

1

—

four shares held.

ir Wicomico Hotel Co.
Dec. 3 (letter of notification) $110,300 of 6% convertible

15, 1971.

participation

'

uiat company plans to acquire

mines,

to

autnonty to ofier

additional

Telephone Co.

was axmouuceu

grapn Co. in a proposed $36,/uu,UUU Caiifonna-to-Hawaii

of

for

Thursday, December 13,1956

.

and sell

Co.
has applied

company

an

1«?%

New

Commission

stockholders

common

a

ou ii

Telephone

Carolina Telephone & Telegraph
North

July

5uu,uuU.

$20,000,000

and

Co., Atlanta, oa.; and Equitable Securities Corp., Nash¬
ville, Tenn.
Offering — Temporarily postponed.

due Dec.

Shear-

and

reported company plans to issue

was

shares

subordinated debentures

Co.

&

first mortgage
bonds. Underwriter—To be determined by competitive
bidding. Probable bidders: Halsey, Stuart & Co. inc.;
Kuhn, Loeb & Co. and A. C. Allyn & Co. Inc. (jointly);
W. C. Langley & Co. and The First Boston Corp. (joint¬
ly); Equitable Securities Corp.; Biyth & Co., Inc.; Kid¬
der, Peabody & Co. and Merrill Lynch, Pierce, Fenner
& Beane (jointly). Offering—Expected in 1957.

between

|

Aug. 24 (letter of notification) 500,000

Underwriters—Shields

Carolina Power & Light Co.
15 it

Hawaiian

y

early

that

reported

was

Hammill & Co., both of New York.

Oct.

Western States Natural

it

12

stockholders.

City. Unaerwriter—

44th bt., New York

East

fice—358

(Texas)

ftiver Gas Co.

registration is ex¬
pected of approximately 200,000 shares of common stock
of this company, formerly Upham Gas Co. Price—Ex¬
pected to be about $5 per share. Proceeds—To selling
Nov.

.

.

—

11; rights to expire on March 29. Merrill
Lynch, Pierce, Fenner & Beane acted as clearing agent
in previous offering to stockholders.

29.

13

it

with

one

issue of preferred stock.

of

Tenn.

announced stockholders will vote Jan. 8

shares

New

stock

held.

England Electric System

Jan. 3,

ital

its subsidiaries, Essex

1957.

Memphis,

a

He added that close to

$18,000,000 will be put into cap¬
investments during the fiscal year to end Nov. 30,

Commerce,

proposal to offer 25,000 additional shares
on the basis of one share for each five
Price—$40 per share. Underwriter—Left- '
wich & Ross, Memphis, Tenn.

Dec.

up

was

approving

of capital

come

Bank

(1/9)
Nov.

★ General Tire & Rubber Co.

would, like to

,

,

National

on

4, M. G. O'Neil, Executive Assistant to the Presi¬
dent, said the management was working on a plan to
revamp
the capital structure and that the company

by

1956, it was announced company plans to merge

trie Light

County Electric Co., Lowell Elec- *
Corp., Lawrence Electric Co., Haverhill Electric

olume

184

Number

5594

.

The Commercial and

.

Financial Chronicle

115

(2611)
and

o.

Amesbury Electric Light Co., into one company
This would be followed by a $20,000,000
mortgage bond issue by the resultant company, the

uring
-st

of which has not

le

Offshore

1956.

pany

yet been determined.- Under*

as

Gathering Corp.* Houston, Texas
18, 1955, David C. Blntliff, Pres., announced com¬
has filed an application with the Federal Power

Nov.

Commission

ter
May be determined by comjpetitive bidding,
obable bidders: Halsey, Stuart & Co. Inc.; Kuhn, Loeb
Co., Salomon Bros. & Hutzler, Eastman Dillon, Union
ecurities & Co., and Wood, Struthers & Co.

for

certificate

a

of necessity to
pipeline off-shore the

—

364-mile submarine

New

it

Power

.

yi

New

plans to issue
nd sell
$10,000,000 of first mortgage bonds early in
957.
Underwriters
To be determined by competive
bidding.
Probable bidders:
Halsey, Stuart & Co.!
nc.; Kuhn, Loeb & Co., Salomon Bros. & Hutzler, Eastan
Dillon, Union Securities & Co. and Wood, Struthers
company

the

build

of

stock).

that this gather¬

Underwriter—Salomon Bros. & Hutzler,
" 1

Oklahoma

July 26 it
by

the

Corp., Oklahoma City, Okla.

sell

was

announced company has been

Oklahoma

in

the

Securities

Commission

to

issue

and

State

of Oklahoma
$20,000,000 of its capital
($10,000,000 within organization and $10,000,000
publicly). Proceeds—To organize or acquire seven sub¬
sidiaries.; Business—A holding company.
Underwriter

Co.

(jointly); Lehman Brothers; The First Boston
Equitable Securities Corp.; Merrill Lynch, Pierce,
& Beane,
Kidder, Peabody & Co. and White,
eld & Co. (jointly).
'

orp.;

—None.

,

b

/:

New

■

■

.

'i

,

Oklahoma Gas & Electric Co.

England Telephone & Telegraph Co.

ct. 16 it
nd

,

(1/8)

Nov.

announced that the company

was

plans to issue
debentures. Proceeds—

sell

sell

$35,000,000 of 29-year
repay temporary borrowings. Underwriter
To be
etermined by competitive bidding.
Probable bidders:
alsey, Stuart & Co. Inc.; The First Boston Corp.; Moran
Stanley & Co. Bids — Expected to be received on
an.
8, 1957.
—

Jersey, Indiana & Illinois RR.

are

ust

(1/10)

Probable

bidders:

Halsey,

Stuart

Co.

gage

and Salomon Bros. & Hutzler
(jointly);'
Dillon, Union Securities & Co. and White, Weld
(jointly); Equitable Securities Corp.; The First
Corp.; Merrill Lynch. Pierce. Fenner & Beane.

Orleans

Public

Service/Inc.

~

r

Co.

Webster

York, Chicago & St. Louis RR.

are

expected

be

to

received

February for

or

the

by

$6,490,000
equipment
robable bidders: Halsey, Stuart &
& Hutzler.^

!

V'/-*,,

the

purchase

oximately

company in
from it of ap-

trust

of

ditional

in

Co.

Inc.;

Salomon

r

Niagara Mohawk Power Corp.
4, the directors authorized the issuance
stockholders

of

—

For

.construction

determined

by

deben-

program.

competitive

bidders; Halsey, Stuart & Co. Inc.; The
Corp.; Morgan'Stanley & Co.; Kuhn, Loeb
Co.
and- Eastman
Dillon, Union Securities & Co.
ointly). Bids—Expected in January.
t
rst Boston

&

Western

expected

ut Jan.

,650,000

Ry.

(1/16)

to be received

16 for the

equipment

on

or

certificates.

Probable

bid-

Halsey, Stuart & Co. Inc.; Salomon Bros. & Hutzler.

Northern

19

it

Natural Gas

was

reported

construction

roqgh

issuance

ter part

of year.

company

of

plans

(costing

debentures

and

to

about

finance

its

$40,000,000)

treasury

fundfc

in

Underwriter—Probably Blyth &!Co.,

c.

ds
c.

are

&

&

Co. and

shields &

Co.;

Salomon Bros.
scheduled for Feb. 4.

&

Co.

(joiptiy;; Glore, Forgan
Bins
Tentatively

Hutzler.

—

Puget Sound National Bank of Tacoma
Nov. 14 stockholders approved an
offering of 25,000 addi¬
tional

of

snares

basis

of

one

new

new

capital

slock

for

snare

eacn

rights to expire on Dec. 14.
Proceeds—To increase capital

Price

(par
three

$10;

$3u

—

the

on

snares

held;
share.

per

surplus.

ana

Pacific Ry.

(12/19)

expected "to be received

this

company

1956, for the purchase from it of about $7,700,COO
uipment trust certificates. Probable bidders:

Halsey,

Inc.; Salomon Bros. & Hutzler.




sale

of

new

bonds

to

public.

power

will be

institutional

in¬

Proceeds—To pay,

project to cost

esti¬

an

.

trust

ment

certificates

aue
semi-annually from July 1,
1, 1972, inclusive. Probable bidders: Halsey,

19o7 to Jan.

Stuart & Co. inc.;

St.

Salomon Bros. & Hutzler.

Louis-San

Francisco Ry.
Sept. 5 company offered not exceeding $61,600,000 of
50-year income o% debentures, series A, due Jan. 1, 2006,
154,000 shares of common stock (no par), and cash
which

has been declared
payable in la56, in ex¬
change for its 616,UU0 shares of $luu par value 5%
pre¬

ferred

stock, series A, on the basis of $100 of deben¬
one-quarter share of common stock and
unpaid
dividends of $2.50 per preferred share in
exchange for
eacn o%
preterrfcu snare. lite oiiei will

tures,

expire on Dec. 31,
1956, unless extended. Dealer-Manager — Eastman Dil¬
lon, Union Securities & Co., New Vuik. Excnange Agent
—The Chase Manhattan

Petroleums, Ltd.
$12,000,-

Underwriter—Eastman,

Dillon, Union Securities & Co.
January.

Offering

—

Expected in

..

Scovill

Bank, New *urk.

Manufacturing Co.

Nov.

29, it was announced directors have approved plans
raise $15,000,000 in January
througn the sale of some
additional common stock
to

(probably

Palisades Amusement Park,

Aug. 31,

Irving

Rosenthal,

Fort Lee,

President,

to

N. J.
that

announced

company plans to purchase another amusement park and
merge the two and then sell stock to public.

stockholders

share

for
of

snares

on

each

basis

a

eight

of

shares

not

held

about

176,000 shares)

more

.than

(there

are

common

Pan

Cuba

9,

Oil

Walter

& Metals

Corp.

(Del.)

one

new

1,411,578
debenture

stock
ou..standing;, and a
offering of about $9,000,000. Proceeds
For expansion
modernization
program.
Underwriter
Morgan
Stanley & Co., New Yorx.
—

and

—

E.

Roebuck Acceptance Corp.
1, Theodore V. Houser, Chairman, announced that
company, a subsidiary of Sears, Roebuck &
Co.,
plans early registration of $50,000,000 of long-term de¬
receivable from

will

soon

Office—120

Broadway, New

Pennsylvania

Electric

Co.

Sept. 12 it was announced company plans to issue and
sell $6,000,000 of first mortgage bonds. Underwriter—
To?'be determined
by competitive bidding. ,Probable
bidders: Halsey, Stuart & Co. Inc.; Merrill Lynch, Pierce,
Fenner & Beane, S Eastman Dillon, Union Securities &

Sears

Dec.

this

bentures.

Proceeds

To

—

purchase

customer

instalment

parent.

Underwriters—Goldman, Sechs
Co.; Halsey, Stuart & Co. Inc.; and Lehman Brothers;
all of New York and
Chicago. Offering—Scheduled for
January, 1957.
Security National Bank of Huntington, N. Y.
Nov.

21 it was announced stockholders have
approved
offering to stockholders of 19,784 additional shares
(par $5; on the basis of one new share for each

an

of stock
25

-

v

shares

expire

held

as

Dec.

14.

of

record

Nov.

Price—$30
capital and surplus.

on

increase

per

20,

19o6; rignts will
share. Proceeds—To

Phillips Petroleum Co.

Sept. 24
will

it

was

indicated

give consideration

that

to

the

company

refunding

next

year

its

$75,000,000 of
short-term bank loans. After review, the
company will
decide the most appropriate type of long-term borrow¬
ing, whether it be insurance loans, long-term bank
borrowing, .convertible debentures or straight - deben¬
tures. ^Underwriter—The First Boston
Corp., New York.

Bids

are

expected

to

be

received

by

this

company

on

Jan. 24 for the purchase from it of
$6,720,000 equipment
trust certificates to be dated Feb. 15, 1957 and to mature
in 15 equal annual instalments to and

including Feb. 15,

1972.

Seiberling Rubber Co.
Sept.
term
mon

for

it

10

debt

was reported that the
company plans longfinancing and/or issuance oi additional com¬

stock.

Proceeds—To

expansion

Blair 6c Co.

redeem

preferred stocks and
Underwriter — Probably

etc.

program,

Incorporated, New York.
!

Slick

Airways,

*

Inc.

Nov. 15 stockholders approved an increase in the author¬

(1/24)

Probable bidders: Halsey, Stuart & Co.
Inc.; Salo¬
Bros. & Hutzler.

Pittsburgh Rys. Co.
May 4 it was announced that Standard Gas & Electric
Co. will offer to its stockholders
rights to subscribe for
540,651.75 shares of Pittsburgh Rys. Co. Price—About $6
per share.
' i

ized
common
stock from
1,000,000 no par shares to
2,000,000 $5 par shares. It was stated that the company
may issue and sell a convertible debenture issue or some
stock

common

For

purchase

in

order

of

new

to

raise

aircraft

$5,000,000.
and

Proceeds—

working

capital.

Underwriters—Auchincloss, Redpath & Parker and Allen
& Co., both of New York, handled stock
rights offering
early in 1956.

Socony
Nov.
1957
on

27
to

the

it

Mobil

Oil

Co.

announced

the company plans early in
offer additional capital stock to its stockholders
was

basis

of

not

more

than

one

new

share

for

each

of

$30,000,000 first mortgage bonds. Proceeds—To

bank loans and for

new

construction.

be determined by competitive

(at Sept. 30, 1956 there were outstanding
The financing may also include an
offering of debentures not exceeding $100,000,000. Pro¬
43,727,585

plans the issue and sale

on

19.

uart & Co.

revolving bank loan which

the general

Public Service Co. of Colorado
Oct. 8 it was reported company

.

by

(12/17)

Bids will be received by the
company up to noon (EST)
Dec. 17 for the purchase from it of
$5,250,000 equip¬

on

10 shares held

;
Northern

the

as

part, for cost of
$217,400,000.

mon

Co.

program

well

★ Pittsburgh & Lake Erie RR.

by the company

purchase from it of approximatelytrust

•

bid-1

ng. Probable

Norfolk

Un¬

program.

White, Weld & Co. (jointly); Equitable Securi¬
Corp.; The First Boston Corp.; Harriman Ripley &
Co. Inc.; Kuhn, Loeb & Co.
'V

sale to

$46,224,200 convertible

Proceeds

lerwritcr—May be

ly

bidding*
inc.; Kuhn, Loeb
Co., Eastman Dillon, Union Securities & Co. and Carl
M. Loeb, Rhoades & Co.
(jointly); Blyth & Co., Inc.; The
First Boston Corp.; Equitable
securities Corp.;
White,
&

ties

.r

and

due Feb. 1, 1972 on the basis of
$100 of debentures'
each 25 shares of stock held. Price—At
100%.of prin-

amount.

plans

refunding mort¬

determined

on a

through
as

-Pacific

res

56

was

Probable bidders: Halsey, Stuart 6c Co.

Co. and

••

-

rs:

(2/4)
reported company plans to issue and sell
about $12,000,000 of first
mortgage bonds due 1987. Pro¬
ceeds—To repay bank loans and for new
construction.
Underwriter—To be determined by competitive

Dec. 10 it

&

Bros. &

(jointly): '

c.

are

Co,

States, Cuba and Canada.
York, N. Y.

determined

competitive bidding. Probable bidders: Halsey, Stu& Co. Inc.;
Kuhn, Loeb & Co.; Blyth & Co. Inc. and
ith, Barney & Co. (jointly)The First Boston Corp.*
d Gtore, Forgan. & Co.
(jointly); Harriman' Ripley &

ds

&

Seibert, President, announced that
file a registration statement with the
to an equity offering planned to take
place later this year. Business—To explore, drill and
operate oil/ gas and mineral properties in the United

•*'

Kidder^ Peabody & Co. and Salomon

and

construction

Nov. 19 it was reported
company plans to offer
000 to $13,000,000 of debentures.

t

pal

on

SEC preparatory

—

be

be

to $60,000,000

April

.

Underwriter—To

program.

$35,000,000 of first

Proceeds—For

mated

:

sell in the
1957, $25,000,000 of debt securities and-an
$20,000,000 in 1958. Proceeds
To finance

nstruction

r

Securities

dend

company

mmon

Union

equivalent to the unpaid portion of the preferred divi¬

certificates,

New York State Electric & Gas
Corp.
ct. 24 it was announced company plans to

Inc.:

Eastman Dillon,
Offering postponed.

was

vestors

.

(jointly); Kuhn, Loeb & Co. and A, C.

bonds.

reduced

Co. Inc.; White, Weld &
Incorporated; The First Boston Corp.;
Corp. and Eastman 'Dillon, Union

(jointly); Kidder, Peabody & Co. and
Securities Corp.
(jointly);; Lehman
rothers.. Offering—Expected in March, 1957.
&

utzler

and

common

up

1

;

llyn & Co. Inc.

ring

received

reported company plans to sell about
$32,stock to the organizing companies and
that arrangements are
expected to be made to borrow

Securities

curities &

ros.

Hutzler

000,000 of

bidders: Halsey, Stuart &

Blair & Co.

quitable

nuary

be

Pacific Northwest Power Co.

ge bonds. Proceeds—For construction program. "Under-*.
Titer—To be determined by competitive
bidding. Prob-

ids

bidding. Probable bid¬
Halsey, Stuart 6c Co. inc.; Blyth 6c Co., Inc.; The
Corp.; Harriman Ripley 6c Co. inc.; Glore,
Forgan 6c Co.; Kuhn, Loeb & Co., Salomon Bros. &
ders:

Aug. 13 it

13, Edgar H. Dixon, President, announced that this
mpany plans to issue and sell $6,000,000 of first mort-

New

repay

Jan. 22.

on

ov.

tone

retire

Underwriter—

Underwriter

by competitive bidding.
Probable bidders: Halsey, Stuart & Co.
Inc.; Blyth &
Co., Inc.; The First Boston Corp. Bids—To be received

Brothers

o.;

Tentatively expected to

—

derwriter—To

astmdn

le

Bids

to issue and sell

12 it was announced company plans to issue and
$5,000,000 of first mortgage bonds.
Underwriter—
determined by competitive
bidding.
Probable
idders: Halsey, Stuart &
Co.; Kuhn, Loeb & Co., Leh-

New

program.

and sell about

Proceeds —To

First Boston

^Reading Co.

be

oston

construction

Dec.

Jersey Power & Light Co.

Co.

for

★ Pacific Gas & Electric Co. (1/22)
5, the company announced it has tentative

&

11

an

and

and

Jan. 29.

ept.
o

issue

Corp.; Mer¬
Lynch, Pierce, Fenner & Beane and White, Weld &
(jointly); Harriman Ripley & Co. Inc.; Kuhn, Loeb

rill
Co.

to be received by this company on
purchase from it of $1,400,000 equipment

certificates.

New

to

be determined by
competitive bidding. Probable
bidders: Halsey, Stuart & Co.
Inc.; Lehman Brothers and
Blyth & Co., Inc. (jointly); The First Boston

Inc.; Salomon Bros. & Hutzler.

o.

plans

bonds.

bank loans and for construction
program.
To he determined
by competitive

expected

10 for the

an.

loans

$30,000,000 first mortgage

Weld

(1/29)

company

—To

&

New

reported

was

$20,000,000 first mortgage bonds. Proceeds—To

bank

o

ids

27, "it

Indiana, Inc.

it was reported company may issue

★ Public Service Co. of Oklahoma

'

authorized

stock

enner

July 30

(jointly).

now

—

Public Service Co. of

of

cost

York.

Inc. and Smith, Barney & Co. (jointly);
Brothers; Harriman Ripley & Co. Inc. BidsExpected to be received early in 1957.

a

coast

Coast

Gulf

plans call for private sale of first
mortgage bonds and
public offer of about $40,000,000 of securities
(probably
notes, convertible into preferred stock at
maturity, and

*

.

Co.

announced

was

19o7.

to

approximately $150,000,000. Type
financing has not yet been determined, but tentative

common

England

3

an.

of

River

Mississippi, it is estimated
will

system

ing

Brothers; The First Boston. Corp.; Equitable
ecurities Corp.; Merrill Lynch, Pie. ce, Fenner &
Beane,
idder, Peabody & Co. and White, Weld & Co. (jointly).!

ffering—Expected-in first half

Sabine

the State of

(jointly);,

ehman

gas

Louisiana from the

Blyth & Co.,

Lehman

repay

Underwriter—To

bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; Kidder, Peabody & Co. and
White, Weld & Co. (jointly); The First Boston Corp.;

shares).

ceeds—For

exploration and development costs and for
plant expansion.
Underwriter—Morgan Stanley & Co.,

New

York.

Continued

on

page

116

lie

The Commercial and Financial Chronicle

(2612)

for

115

Continued from page

by Alabama Power Co. and 50% by Georgia Power Co.,
subsidiaries of Southern Co., plans to issue debt securi¬
ties.

construct

Proceeds—Together with other funds, to

it

4

on

on

a

about Jan.

or

Texam Oil

(1/22)

filed with the Indiana P. S. Com¬
for authority to issue and sell

Pacific

Southern

8

Dec.

it

in

Valley National Bank,

approving

to

12

was

subscribe

stock

for

(par $5)

l-for-3

2%

basis.

105,000 additional
the basis of one

(1/15)

Bids

Proceeds—To

for

9

the

Dayton, Ohio.

it

6

Dec.

of ACF-Wrigley

be

which

company,

sites

house
&

..

director

extent

compensation,

here,

not the

is

may

include individual locations, ware

shopping

and

as

Dillon, Read Group
Offers Texas Eastern

__

registered earnings.

":;y.

Transmis'n 51/2% Debs

V '/

•

In any

event, the shareholder's most beneficial action for his
well-being in company relationships, under present condi¬

own

balance sheet items, remember that investor-wise at
least, current assets are far more important than fixed assets; with
added assurance derivable from a high working capital.
Among

owner;

remaining

uncertainties

great

the

in

appraising management, it does entail the constructive major bene¬
fit of impressing on the investor's consciousness the propriety of

$163,245,000 Memphis Eieciric Light Plan!

employing realism in the way of value criteria in lieu of vague
glamour.
'i). V;:,//

Revenue Bonds Offered for Public investment

'

Your Status

there

Overall

The first

tence.

remain

as

a

two

Public Stockholder

facets

main

within

hits him

his

of

impo¬

ing

ever

undertaken

vis-a-vis manage¬

for

the

construction

ment; stemming from the basic technique of our corporate system,

generating

ownership is separated from control—as originally
delineated in the epochal volume by Adolph Berle and Gardiner

lities

under

which

C. Means,
in

the

The Modern Corporation and Private Property.

Again,

community, the

shareholder finds himself without power
intervention. In contrast
to other community sectors, and vocally effective pressure groups,
the shareholder remains unorganized—the real "forgotten man."
versus

.

both other groups and government

In the

absence

of service from

any

larger-scale trade associa¬

the current safeguarding of his rights and interests is to

tion,

a

great extent vouchsafed in a few stockholder groups, as the Inves¬
tors

League and the United Shareholders of America; or in the
activities of a few aggressive and
colorful individuals largely
in

concentrated

meetings.

In

dramatized

sum,

fights or activity at annual
the stockholder's protection is haphazard.
proxy

Part of his basic trouble is the persistence of public relations
difficulty. He still carries the connotation of "Wall Street." Again,
lie is only a shareholder part time, leading to apathy in contrast to

lull-time

concern

by other categories in the community.

Vis-a-vis

management, the two basic and constructive ques¬
fully met; namely, is the management capable and
Worthy of confidence; and is it actually treating the stockholders
fairly? Instead, too often attention is concentrated on superficial
issues, as salaries. And too frequently, and in surprising quarters,
tions

,

is

are

that

not

inexcusably

scribed to:

unwarranted

"philosophy" sub¬
stock." This is akin to

"If you don't like it, sell your

telling, the

citizen to leave his country, if
government's doings objectionable.

he finds

some

rather, either

on

his

of
I

.

The stockholder should

his

own or

with reli¬

able aid,

exercise continuing judgment on such items as compensa¬
tion, eliminating the influence of sensationalism and demag'oguery;
the stock option; dividend policy, a most difficult matter to weigh

objectively; gnd the independence of the directors from the
tives,

an

The

director

Cumulative
The

execu¬

additional guarantee of good practice.
Possibilities

of

Reforming

system

should

the

be

Director

reformed

in

several

might

be

composed of three sets of directors:
(I) Managers, who are experienced in the business.
(2) Owners,
who are stockholders in substantial amounts. (3) Intelligent busi¬
nessmen; accustomed to directing the affairs of others, and apprais¬
ing their results.




They would protect the nondirectors.

city

any

of

Dec.

.

://-■:'/

.

proceeds from the sal
of the debentures will be used b
The

net

$28,000,00

the company to prepay

distribution faci¬

and

being

Operating
tric

Light

Plant

made

in
A

contract expiring

a

June 1, 1958.

on

electric

revolving credit notes and th
balance will be added to corporat

the

over

from

1955

Bonds,

total

Series A. The offering, considered

year

the

$20,416,557

to

years,

$5,356,129

in

1941.

indicates
operating revenues in the
1965 will amount to $65,128,-

projection of

revenues

564.

most

Revenue

important piece of

new

financing to come into the muni¬
cipal market in the last six
months of 1.956, is being made by
a
nation-wide group of approxi¬
mately,, 450 members headed
jointly
by
Salomon - Bros.?, &
Hutzler; Smith, Barney &
Co.;
Blyth & Co., Inc., Halsey, Stuart
& Co., Inc.; J. C. Bradford & Co.,
and Equitable Securities Corpora¬
tion.

offering

consists

$143,245,000 of 4.40%

of

term

bonds

1963

and

4%.,

and

Jan.

1,

$20,000,000 of 5%,
4.20% serial bonds due
(b)

term

at

The

from

a

bonds

100%

serial

bonds

of¬

being

are

are

yield of 3.50% to

inter¬
scaled

dollar

a

price of 100 (4.20% yield).
the offering will
applied by the City, of Mem¬
phis, which has operated a muni¬
cipal electric system for many
Proceeds from

to the

cost of construction

acquisition

of

improvements

to and extensions of the system

City.

ceeds
with

will

Specifically,
be

used

in

the construction

the

of

pro¬

connection
of

a

gener¬

ating station to provide the power

requirements
from

,1968

the

the

City

Tennessee

purchases

Valley

Au¬

subject

ject

to

at

to

Jan.

1,

redemp¬

a

$238,000,000 program which con

templates

not less than

on

6'0

The

serial

30 nor

more

not

are

re¬

bonds

whole

for

refunding

prior to Jan.
to

1968

1977 and

purposes

1967.

1,

and

the

including
bonds

term

the

and

tern

Inch"

pipe

line

Jan.

Jan.

1,

sub¬

are

of

"Little Bi

portion of the

of

day i

per

reconversion

major

transportatfo

to

petroleum products. Additions

essary

the

complete

to

appro

will

imately $100,000,000

be ne
progran

Approximately half of the gas f
new

chased

of

agency

an

is

program

eminent,

at

a

purchased

the

Gulf Coast

The

States.
the

be

pur

connection

V

on

balance is t

producers

from

i

of the Unite-

area

reconversion

"Little

Gov

Mexican

the

Grande and the

Rio

to

fr^p) „g^ti;oJeqs Mexicano,

be

bonds maturing

gas

capacity of the company's sy

the

bonds

prior to the redemption
the term bonds.
The
are Wt redeemable as

off, all /of
term

1,

sub¬

are

notice.

days

deemable

a

bonds

increase of 250 mil

an

cubic feet of

lion

1, financing to the extent,of

including Jan.

the term

redemption in whole or
time on and after Jan.. 1,

any

1967

and

to

and

of

pa

ject to redemption in part on Jan.
1, 1963 or on any interest pay¬

of

ment, date

petroleum products transportation

than

be

the

1

The serial

and accrued

maturing Jan.

including

serial bonds maturing Jan.

1977

1963-1977, inclusive.

The

fered

bonds

and

not

are

The

(a)

due Jan. 1, 1992;, with a mandatory
annual sinking;fund beginning in

est.

1967

to

origi

nally incurred in connection wit

tion.

than

The

serial

1968

portion of th

major

revolving credit notes was

the

The

1,

The

funds.

of the elec¬
stead¬

revenues

system have increased

ily

and
ways.

by

thority under

today with
the public offering of $163,245,000
City of Memphis, Tenn., Electric

years,

System

voting could be universalized.

Board

is

invalid

and

Corp.

of

The largest revenue bond offer¬

stockholder

company,

/

Texas
Easter
5 Ve % deben
1, 1976, priced a

of

due

ioo%.

grou

(Dec. 13

which is offering today

Transmission

head

Inc.

banking

investment

$30,000,000

capital investment.

of

way

Co.

&

Read

Dillon,
an

business
and thus conscientiously discharging his obligation to his

lies along the constructive lines of behaving as a

tions,

tures

the

Underwriter—Alle

centers.

Registration—Expected shortly.

Co., New York.

key;

Conclusion

permitting accelerated amortization of plant machinery, hav¬

Whatever

the paren

develop locations principally for use by

tried in England and to a
remuneration made in stock
might be helpful, for ensuring community of interest. More effec¬
tive than stock options, it would enhance the sense of trusteeship
obligation..
*
'•/
While

ACF-Wrigley. Proceed

ties stock for each two shares of
—To

equipment

lesser

newly formec

announced this company, a

Stores, Inc., plans to offe
its shares of capital stock for subscription by the latter'
stock, debenture and option holders, the offering t
stockholders to be on the basis of one share of Proper

trust certificates.
Probable bid¬
Halsey, Stuart & Co. Inc.; Salomon Bros. & Hutzler.

from page 4

Inc.

Properties,

was

subsidiary

received by the company on
purchase from
it of approximately
to

its stock

the right to subscribe fo

15

Jan.

about

or

^ Wrigley

(1/9)

expected

arc

Jan.

Sell

RR.

trust Co. (1/15)

announced Bank plans to offer to

was
on

both of

shares of common
share for each

new

Underwriters—A syndicate
houses whose identity
will be made public at a future date. William R. Staats
& Co. and Blyth & Co., Inc. underwrote rights offering
in July, 1954.
Wabash

per

175,000 additional shares of capital stock on a 1-forbasis; rights to expire on Jan. 30. Price—$22 per share
Underwriter—Greene & Ladd and Grant Brownell & Co.

15,

investment

national

share. Proceeds—To in
Office—McKeesport, Pa.

Price—$30

Jr Winters National Bank &
Dec. 3 it

Price—To be named later.

was

capital and surplus.

crease

capital and surplus.

—To

ing the effect of partially deferring

holders

stock

each

1956.

Phoenix, Ariz.

and

local

ders:

.

for

a

increase

(1/22)

Observations

7,

on

shares held.

$2,000,000

Continued

capital

proposal of the bank to offer to its
stockholders of record Jan. 15, 1957 the right

common

the company cn
about $5,600,000

Electric Co.

of

share

new

announced stockholders will vote Jan.

it

on

National Bank

Pennsylvania

reported Bank plans to offer to its stock
132,812 additional shares of capital stock on

Nov. 13 it

holders

1987. Proceeds
approximately $6,000,000 of bank loans and

repay

per

effective Dec.

Pasadena,

$10,000,000 of first mortgage bonds due

tions

Corp. and W. C. Langley & Co.
Brothers and Goldman, Sachs & Co.

1956; rights will expire on
share.
Proceeds—To pur¬

15,

Price—$27.50

The Firs
(jointly); Lehmai
(jointly).

Loeb, Rhoades & Co.;

M.

Carl

bidders:

Boston

Diego, Calif.
to offer to its

plans

shares

one

of

reported company plans to issue and

was

Nov.

To

—

about

able

chase Pasadena-First National Bank and its two branches

equipment trust certificates. Probable bidders: Halsey,
Stuart & Co. Inc.; Salomon Bros. & Hutzler.

Nov. 21

of

as

1957

Ry. (1/8)
expected to be received by
the
purchase from it of

Gas &

20.

basis of

the

company

Bank of San
Bank

additional

75,000

on

held

snares

National

announced

was

plans to offer to it
additional commo
be named by company (sufficient tr

reported

was

\

Co.

$11,000,000 or $12,000,000).
Proceeds—Fo
construction program and to repay bank loans. Under
writer—To be determined by competitive bidding. Prob
raise

announced

Nov. 27

for

Southwestern

$10)

(par

(1/3)

Co.

it

9

Electric

stockholders in March, some

Price

stock.

Registra¬

common

stockholders

Jan. 22.

on

it

5

Dec.

common

Western

Southern
are

stock

common

oversubscription privilege)

Corp., San Antonio, Texas

was

stock and temporary bank borrowings
The First Boston Corp., New York; an

—

Penn

West

Proceeds—For construction program.

United States

expected to be received by the company on
Jan. 3 for the purchase from it of about $9,600,000 of
equipment trust certificates. Probable bidders: Halsey,
Stuart & Co. Inc.; Salomon Bros. & Hurler.

Jan.

it

of

Nov.

are

Bids

an

to

to financ

proposes

company

Johnston, Lemon & Co., Washington, D. C.

offer

application

Kidder, Peabody & Co.; Eastman, Dillon, Union Securi¬
ties & Co.; The First Boston Corp.; White, Weld & Co.
and Shields
&
Co.
(jointly).
Bids—Tentatively ex¬

Bids

(with

to

announced

was

new

Underwriter

that the l,OOt),O0O additional
stock, recently authorized by the di¬
rectors, will provide the company with the additional
working capital it will require for further expansion.
1

Oct.

to be received

it

of common

sale

(1/15)

plans

Underwriter—Dillon, Read & Co., New York.
on Dec. 21.

$5,000,000 30-year first mortgage bonds due 1987. Pro¬
ceeds—To repay bank loans and for construction pro¬
gram.
Underwriter—To be determined by competitive
bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
Equitable Securities Corp.; Kuhn, Loeb & Co. and Salo¬
mon Bros. & Hutzler (jointly); Blair & Co. Incorporated;

pected

Co.

company

additional shares of

15

l-for-14 basis.

shares

an

7

construction of pipeline in Virginia t
about $3,380,000 from funds generated by operations

cost

tion—Expected

Stanley & Co.
Indiana Gas & Electric Co.

Service

announced

was

stockholders 292,000

Probable bidders:
Halsey, Stuart & Co. Inc.; Eastman, Dillon, Union Secu¬
rities & Co.; Equitable Securities Corp. and Drexel & Co.
(jointly); Lehman Brothers; Harriman Ripley & Co.
Inc. and Goldman, Sachs & Co. (jointly); Blyth & Co.,
Inc. and Kidder, Peabody & Co.
(jointly); Morgan
Southern

Public

Southwestern

Thursday, December 13,195

.

Washington Gas Light Co.
proposed

Dec.

determined by competitive bidding.

mission

determined

June

•

and operate a $150,000,000 steam electric generating plant
on the Coosa River in Alabama.
Underwriter—May be

Nov. 16 the company

be

Inc.; Equitable Securities Corp.; Salomon Bros. &
Hutzler; Blyth & Co., Inc.; Lehman Brothers; Kuhn,
Loeb & Co.; Merrill Lynch, Pierce, Fenner & Beane.
Bids—Expected to be received on Jan. 22.

announced that this company, 50% owned

May 18, it was

Underwriter—To

by competitive bidding. Probable bidders: Halsey, Stuart
& Co.

Electric Generating Co.

Southern

construction.

new

.

.

30

notice

thereafter

nor

in

on

than

more

less

not
60

days

order of matur¬

inverse

ity and

by lot within a maturity
through
the
operation
of
the

service

fund.

Serial

prices

as

104% to
and

and

from

Interest

for

existing

from

range

100%, while sinking fund

redemption

range

empt

whole

a

call

bonds

term

fund

102%

on

to 100%.

the

Federal

laws.

call

bonds

taxes
'

prices
.

are

'

1
ex¬

under
'

extending from Beaumon
to

with

lateral

a

Moundsville,

Aug.

sinking fund, be

1,

prior to maturity.

cf

retif

of the issu

The debentur

redeemable at the

the company.at

Dec.

will

1959,

approximately 96.3%

also

Vi

W.

Chicago, 111.

to

A semi-annual

ginning

are

furnish

to

company

Texas

sinking fund account and redemp¬
tion

the

able

Inch" will en

Big

any

optioj

time afte

1, 1961 at prices scaling fro/

105!/2%

to

100%.

'

rolume

184

5594

Number

.

.

The Commercial and Financial Chronicle

.

(2613)

Ten Million Dollar National Offers New

Wellington Fund
C7

Sales

Mutual Funds

Record

at

Gross sales of Wellington Fund
November were the highest for

of the fund, according to A. J.
ilkins, Vice-President, who re-

rp-i

$11,667,000 sales for NoThis compared with $9,60,000 in November last year.

The

Wilkins

ecord

volume

rought

sales

onths

this

eriod

in

first

the

for

11

to $95,574,000,
total for any similar
fund's

the

for-a

go,

the

in

first

1956 will approach or exceed
in

me

fund's

the

ilkins

history,

situation, points out that
trend

sales

credit to

of

1957

high

Mr.

SECURITIES
a

new

models

car

are

the next few
The industry,

an

an

for

the

through November period

quarters earnings reports reflect this. However, rising volume of
business in the fourth quarter of 1956 and a good first quarter
expected in 1957, should help considerably. In addition, manage¬

months in 1955, it was anby E. Wain Hare, Vice-

ments will have had some time in which to

ounced

effect economies and

re-price products, the Wellington executive

resident of National Securities &

gers

stated.

this

November
e

sales

onth

a

year

the

for

those

over

orted.
er

year,

National Securities Series

6%

ago,

79,670

.■

of Gulf and Standard of California

early this past August.

Holdings

re-

Delaware
of

its

total

Fund
net

now

assets

the oil industry, as

13.8%
to

Putnam Fund Sales

has

16.6%

invested

in

compared with

Sept. 30, last, according
the fund's latest semi-monthly

by investors of

of The

ares

Putnam Fund

new

dur-

November were the largest
r
any month in the history of
e fund, up 26% over November
f last
year
and totalling more
an $2,400,000.
With redemptions
r
the
month down
41%, the
lg

ount of net
g the

49%
e

new

money

fund showed
over

three

an

enter-

increase

November, 1955.

months

For

September

a

Plans Stock

on

Directors'
Purchases

Colonial Fund

Report.
W. Linton Nelson, President, in
commentary on the fund's in¬

creased

oil position, says

"Now it
appears unlikely the Suez Canal
will be back in operation within
six months, and
many qualified
observers are even extending this
estimate to a year. Consequently,"
he points out, "instead of oil mov¬
ing to our Atlantic seaboard from
the Middle
East, we are being
called upon to dip into our sup¬

Split

Colonial
oldest

Fund,

investment

operating

mutual fund, has
plans for a 2-for-l

announced
stock

now

company

a

as

James H.

Orr, President of Co¬

Fund,

announced

that

the

fund's shareholders will be asked
to

double

Mr.

Orr

the

said,, "After

holders vote,

pected

to

authorized

the

the directors

declare

a

capital.
share¬
are ex¬

100%

stock

to
shareholders
of
plies and make up the deficits in distribution
of Western Europe."
record Dec. 31."
ew shares were up 24% over the
The fund's investment in this
He also pointed out in the an¬
rresponding period of last year, industry now consists of 10,000 nual report just released that dur¬
shares of Anderson-P richard;
edemptions were down 22% and
ing the past ye^r total net assets
9,000, Arkansas Fuel Oil; 15,000,
et new money represented an inof the Fund had risen over $9,Chicago Corp.; 8,400, Cities Serv¬
ease of 44%.
ice; 15,000, Ohio Oil; 2,000, Phil¬ 000,000 to a new high of over $35,-

trough

all

of

initial

the

November,

2 000 000

offering

registration

purchases

lips; 5,000, Richfield; 1,500, Royal 000,000 at Oct. 31.

"Per share net
10,000, Shamrock; 8,500, asset value at that date," he
said,
Sinclair; $500,000, Sinclair 4% Cv.
"was $19.43, up 10% for the fiscal
Deb.; 10,000, Socony; 10,000, Stad.
of Indiana; 10,000, Std. of N. J.; year after allowance for security
12,000, Std. of Ohio; 20,000, Sunray profits distributions of $1.30.

Dutch;

booklet

points

out,

sooner.

long term Potentialities."
Entitled "Give Me A Place to
Stand and 1 Wil1 Move the Earth"

of the

davs

after

statement

be

whicTever

effective,
However,

comes

shares
30

or

is

f+; g

the board of
directors may extend the time up
Until

such

periods.
the fund will
its funds in se-

time,

invest any of

not

™

company's

offices,

lPnw

Wa-

mana^

Colton

nf

t

Natl0I)al

vSf £*}ecir0n™

NuXT'c^„Srn°ro7Tme^h

SSft&SST U' S- GOVem"
The

T* potential-

nf

Tt

to two 60-day consecutive

^

and

those of its investment managerFlorida Growth Co.-are at 243

SCOpe of

South

County Road, Palm, Beach.
Custodian, transfer and disbursing

directors

follows:

(President)
Frank

the

Fund

B.

managing partner
Bateman, Ltd.; Ar-

Burke

fVire-PresidenH

formerly
connected
with
the
Guaranty Trust Co., of New York;
William M. Bateman
(Secretary
and
Assistant
Treasurer)
is
a
member of the Philadelphia-Baltimore Stock Exchange and Sales
Manager and a general partner of
Frank B. Bateman, Ltd.

cal

York,
Stock
guire,
Bank

Sanitation

Commission, President and direc£

*

tor

m

-o

of

Tu-rr

^

Railroad

rector

of

Merchants

Insurance

Society

1^'1"strumeiJts'
always emphasizing their rela-

f!°"ship to investment opportunlA ffil|0fA/|

cago,

Wilson

and

Fifth 912

Mfgs.
Aid

Chi-

Bros.,

and
a d

dirertor
director,

a

a

Corp. and director and
of

Treasurer

house

and

Palm

Beach

Assets Now

'

ber of the New York and Florida

partner,
Broberg,

George

,,6

,

Beach,

Schneider,

R.
„

>

.

0

of

Security Consel-

Fund, Inc., Chicago,

,

6,684 to 133,757. The number of
Par?lc]Pants in tlie company's

periodiC Investment Program continued to grow and reached
an

f year earlier
"n'8
a

formerly associated with

Schoellkopf,

a

31

tha val.ue
cent dis¬

realized

security

of

record

the first day of the fiscal

year.

In his report, H. I. Prankard, II,

P/eside^' point* out that,
shareholders who

accepted

"?ose

their

year.end capital gain distributions
in additional shares of stock, divi-

Buffalo, N. Y., investment bankers

dends from income have increased

28

PUTNAM

Prospectus from
your
CFC

or

,r.

tired

Qeorge

of

of ^Boston

„

.

and

di-

,

of Finance
.

„

T

0

BALANCED FUND"

Colo., and

Vitamin
Arma

invest in

a

vaxuati0n

director of U. S.

and

Corp.,

in

many

growth

Bosch

many reflect too full
Qf their long-range

prospects.

investments

are

Currently,

largely in

its

serv-

Inc.,

and

ice companies, producers of non¬

ACF-Wrigley

goods
and
companies
producing fuel and raw materials.

Hall-Scott Mo¬

tors, Inc.; and
Oliver

through

„

of

~

i*

Gulf

Philadelphia Fund total net

Whipple, Vice-President
T

„

Insurance

Co.,

ville, Fla., in charge of its invest-

DEVELOPMENT

rpents,

i

Ask your Investment

FUND, INC.

Dealerforfree Prospectus

Putnam Fund

GET THE FACTS AND FREE PROSPECTUS

or

write to

nf
of

Distributors, Inc.

Npw
New

curities

Atomic Development Securities Co., Inc.
1033 THIRTIETH STREET, ttH,, WASHINGTON 7, 0. C.

Tel. FEderal 3-1000




NEW YORK

CHICAGO

•

LOS;ANGELES

office he has

Vnrk
York,

also

also

ORLANDO

he
be

was

was

of $5,101,000, equal to $18.72 per
share on the outstanding stock,

fortor

Th.g

Union Se-

Palm

Treasurer.

Beach

Cashier of Bank
&

Trust

Co.,

represents

an

increa6e

of

$^040,000 or 25% over total net
assets of $4,061,000 equal to $18.31

Co., New York.

Carl I. Cassell.

of

held

Insurance Co.,

merly Vice-President,

60 Congress Street, Boston

)

which

in the Mutual Life

as-

the $5 million mark
fQr the firgt tiffle> Roy R
Coffin>
President, reported. Assets of the
fund are now at an all time high
sets crossed

Tonb.on„

Jackson-

ATOMIC

Dept. C

has substauntially

investments

durable

Stores,

ATOMIC SCIENCE

MUTUAL

its

ket prices for

tv

American

Corp.,

company

reduced

of the popular so-called "growth
stocks," believing that the mar-

and

Committee,
rs

^

The

Colorado Fuel & Iron Corp., Denver,

"K

di-

director

York,

New

while the cost of living increased

l.

,

and

in the past' 10 years,

°Yf**

re-

Securities

American

Chairman

investment deafer

PHILADELPHIA 3, PA.

,

President

later

rector

Corp.,

.,

„

Vice-President

as

rector,

FUND

from which he

years,

...

The

&

for

net

Pomeroy,

for

Hutton

of

terly period.

...

,

to

cash toward the end of each quar-

111.; Charles

^

G. Terry,
-ar

out-

4,148.343

60,137,555. Shareholders increased

the Board of Automation

of

Shares

9oD^!^ends S0111 *ncome' paid in
totalil}£
23 cents a share, were

.

lors, Inc., Chicago, 111., and Chairman

,

to

$357,977,445.
standing
increased

on

Fla.;

«

shows

Net assets increased by $22,370,-

920

profits to shareholders

Chairman
..

companies,

year*end highs in net assets.
s?are? 0"tstabding and number of
sbaieholders: in its r®Port for the
ye?Tr ended 9C^ 31' !

tribution

Richardson

Palm

the Board

of

Coe,

investment

Per-share net assets increased by

FrRichardsonrJr.,

and

Affiliated Fund, one of the larg¬
est

all-time high of 26,810.

Play-

Henry F. Richardson, Jr., memJ
men

Bars,

at

$358 Million

Corp., Pa}m Beach, Fla.;
'

lAnvwl

ICII J; III 111

j-

Co., di-

Traveller's

Co.,

President
res dent

ca*o

^

Utilities

atomic

muHe^

JLLia qJ?j P10c-ssas> special ma-

J.

Disher, formerly with
Anthony
&
Co.,
New
members
of
New
York
Exchange; Jeremiah MaChairman
of
Federation
&
Trust
Co., New York,

including

covered,

are

Bateman

is

B.

E

of

Frank

t radioaie^summarS]pecific subjiects are

iQn*5JL

agent are Florida National Bank
& Trust Co., of West Palm Beach,

Chairman of Interstate

split.

lonial

n

an

Tucker,

America's

Inc.,

the

"atomic energy has little history
to study- The future must be projected .through, a technical under-

comnTnv with re~ standing of these new engineering
orf and' after the devel°Pments and their short and

diversified

sale

Alex.

Of Two-for-One

"Unlike other present day tech-

deemable shares

of

Delaware liquidated its holdings

Boosts Its Oil

rose

-

Union

8,000,

most $300,000,000.

iossf

i?a
w
wil? himmp

thur

of

$4,357,123, against $2,in
November
1955,
he

and

Oil of Calif.

same

Mr. Hare

dded.

Mid-Continent;

Delaware Fund

+

nanv

as

Total volume for Novem-

was

i

The

eries.
In spite of the generally
eclining market during the month
f

+

rnSfn!, T?1ivWiq

esearch

Corp., sponsors and man¬
of the National Securities

ac¬

™
k'' a&ers of National Growth Stocks
1S expected t° be Series and six other mutual innear future when vestment funds with assets of alnology,"

Ld

analysts,

booklet prepared

a new

by National Securities & Research
Corporation, sponsors and man-

,

shares

^

™

annual rate of about 2%.

Discussing corporate profit margins and profits, Mr. Kulp
pointed out that it takes the best corporation managements a little
time to offset higher wage and raw material costs. The last two

alL

is year, and compared with sales
f $49,467,535 for the correspondlg

"The

automobiles.

SE-

new

$57,373,934

of

clue to business prospects will be

to

has been held down to

nuary

a

modity prices, caused by rising wages, the rise in the cost of living

IES sales established
'me

has been

year

approximate balance with available man-power and
raw
materials is hurting in spots, but has maintained a stable
economy.
Although there has been an upward pressure on com¬

stated.

NATIONAL

improvement in the past

generally, i# looking for about a 10% increase over 1956."
Reviewing the tight money situation, Mr. Kulp stated that the
Federal Reserve's policy of restricting the available supply of

$100 million mark for the first

e

The business

have had a favorable reception and
months will provide a test of consumer attitudes.

indicate that gross sales
Wellington Fund for the full

ear

,u

.

tS

f

Soir^

S

reported

is year

f

shape
1956 and

S£nnnacapital shares of+fer® 2>~
B*\e™aYl Ltd' at $d a
000,000

the

or

months

11

to

favorably with indications that the last quarter of

ness

■

Results

continues

running at the annual rate of$4% in the production index and 5%
national product, Mr. Kulp added.
The Wellington executive in his periodic review of the busi¬

history. This

$29,290,000

gain of

term

in gross

ompared with sales of $66,284,000
the first eleven months a year
4%.

near

cording to

Fund stated.

the

November

in

the

over

investment

trained

the first half of 1957 may show the same rate of improvement as
seen in the past year, A. Moyer Kulp, Vice-President and Chair¬
man of the Investment Committee of the $500 million Wellington

year

highest

e

that

reported

up

outlook

business

ember.

Mr.

Offering
Expected Soon

Business Outlook Favorable

orted

Investing in the "Atomic Age"
requires the joint efforts of scien¬
tists
and
engineers as well as

Fund

By ROBERT R. RICH

ry

Atomic Age Booklet

Florida Growth

month in the 27-year his-

ny one

117

share at the start of 1956.- Mr.
Coffin attributed the increase m
a

is
.

'

Continued on page IL-)

The Commercial and Financial Chronicle

(2614)

J18

The

Indications of Current

week

Business Activity
T .a test

AMERICAN

or

month available.

month ended

*2,493,000

2,466,000

2,421,006

7,132,650

7,195,350

6,981,100

6,836,400

gallons

each)

of

—Nov. 30

——.

___—

England

Middle

(bbls.

average

Previous

5i8,114,000

3,111,000

7,853,000

26,816,000

26,620,000

158,871,000

158,685,000

44,389,000

45,745,000

48,071,000

Ago

CITIES—Month

si

$25,235,912

*._2—

'

$41,514,711

119,710,777

———

—4-——

'——1__

143,813.654
"

$26,053,663
78,460,133

35,899,804

44,435,779

100,331.047

102,814,486

73,323,093

75,695.241

73,156,089

39,656,257

28,676,526

54.193,249

31,920,975

__

36,035,444

108,670.922

21,129,196

22,864,261

95,517,231

14G,103,u0C

Nov. 30

Year

Month

&

Central

East

26,963,000

153,498,000

INC.—215

DUN

—

—-—

Atlantic.

Southi, Atlantic

7,801,000

27,043,000

to stills—daily average (bbls.)
—-Nov. 30
output ())bis.)_-ii.——-i—-Nov, 30
Kerosene output ( bbls.
Nov..'30
Distillate fuel oil output (bbls.)—„—
Nov. 30
Residual fuel oil output (bbls.)
——
Nov. 30
Stocks at refineries, bulk terminals, in transit, in pipe lines—
Finished and unfinished gasoline (bbls.) at
Nov. 30
Kerosene (bbls.) at
Nov. 30
Distillate fuel oil (bbls.) at—
Nov. 30

VALUATION

October:

of

New

42

PERMIT

of that date:

are as

Month

BUILDING

100.3

100.2

§2,511,000

_Dec. 16

AMERICAN PETROLEUM INSTITUTE:
Crude oil and condensate output—daily

of quotations,

cases

either for the

are

Latest

BRADSTREET,

Equivalent to—
gteel ingots and castings (net tons)

in

or,

Ago

Ago

*101.3

that date,

on

production and other figures for thi

cover

Dates shown in first column

v„ar

**inth

Week

§102.0

Dec. 16

or

P^vjoUS

Week

STEEL INSTITUTE:
(percent of capacity)

ANB

IRON

Indicated steel operations

following statistical tabulations

latest week

Thursday, December 13,1

.

79,313,394

85,415,091

$526,509,213

$487,392 751

44,156,006

Crude

runs

Gasoline

—

,

———

Residual

fuel

(bbls.)

oil

at

2,386,000

2,855,000

2,507,000

12,761,000

12,477,000

12,475,000

8,567,000

8,458,000

7,835,000

174,544,000

172,626,000

157,535,000

34,595,000

36,305,000

35,235,000

33.221.006

Mountain

{

.

CONSTRUCTION

ENGINEERING

CIVIL

752,150

.650,920

800,272

723,736

610,358

1
1

622,326

663,919

610,344

Public

State

Dec.

79,848,000

171,104,000

97,772,000

163,099,000

36,275,000

16,429,000

If-, 160,000

28,184,000

municipal

and

Federal

OUTPUT

COAL

(U.

coal

Bituminous

BUREAU

S.

and

Electric output

IRON

9,140,000

10,590,000

447,000

498,000

Single

581,000

196

1

148

124

steel

<>

METAL

PRICES

(E.

12,075,000

11,522,000

11,426,000

254

j)00

219

219

All

Export

(New York)

at

Lead

(St.

at__

Zinc

Louis)

(delivered)

JZinc

—

at——U—_—-------———

at

Aluminum (primar« >1(3. 99';
tin (New York) at

) at

Straits

MOODY'S
U. S.

BOM)

DAILY

PRICES

—

Aaa

.

5.174c

Meats,

$59.09

Dairy

$65.17

$64.33

$59.83

$49.50

Fruits

and
foods

35 790c

35.700c

35.700c

49.925c

34.725c

34.325c

34.975c

44 500c

16.000c

16.000c

16.060c

15.500c

15.800c

15.800c

15.800c

15.300c

13.500c

13.500c

14.009c

14.000c

14.000c

25.000c

25.000c

108.250c

HO.OCOc

112.125c

89.73

90.83

89.78

96.69

98 25

Group

fuels

101.04

U.

98.88

100.49

96.69

98.25
92.79

97.21

95.16

96.54

97 47

98.41

DAILY

99.52

3.34

3.25

3.97

3.96

3.86

Other

3.32

3.72

—Dec. 11

.

3.72

3.65

3.14

3 83

3.82

Public

Utilities

Industrials

Group—

3.92

4.06

3.97

3.92

3.SI

3.35

3.3C

Dec. 11

3.91

3.90

3.78

3.2-

Dec. 11

—

of

Dec.

Unfilled

(tons)

orders

OIL, PAINT AND
1949

1

at

Dec.

—

of

period—

REPORTER

DRUG

AVERAGE

end

437 5

423.0

202,463

372.488

260,253

282,327

EXCHANGE

—

sales

Number

by

89

90

654,61:

1

407,812

373,310

7

109.56

109.62

109.48

397,98):

•190,515

V

Number

of

Customers'

short

other

!

sales

1,044,342

of

Short

$74,162,912

Other

AND

6,587

57,982,944

$44,633,922

$37,294,134

173,390

205,480

314,306

205,480

314,306

Total

177,750"

17

Nov. 17

SALES

.

,

,

ON

THE

STOCK

N

V.

428,280

756,430

481,950

479,826

....

,

FOR

17

588,330

603,170

379,100

17

9,944,750

8,916,480

8,201,770

12,657.850

Nov.

OF

17

L0,533;080

9,519,650

8,580,870

13,207,630

OF

1,334.200

1,058,420

1,727,660

17

332,930

395,130

185,960

245,270

Nov. 17

,,

._

on

the

floor—

1,100,100

900,990

1,345,820

1,433,030

1,131,390
1,526,520

1,086,950

1-,591,090

301,440

256,260

254,190

375,621

Nov.

17

off

49,400

22,600

;

277,040

260,500

279,910

346,980

310,040

309,900

302,510

394,380

17

56.190

437,360

396,485

406,350

84,620

79,090

94,600

546,779

344,221

632,859

628,841

17

Nov. 17

614.40-

583,320

709,202

1,986,945

1,718.960

2,800,710

529,150

287,650

bales)

122,648

1,923,919

HI()V[

1,936,111

1,685,130

2,375,929

2,465,261

1,972,780

2,694.672

115.7

115.9

114.9

111.1

II Dec.

SERIES

—

U.

S.

DEPT.

86.7

88.5

87.9

83.8

-

17

546

.100

1,152

1.378

940

1,233
4

1.042

2.749

866

846

21,695.000

1.458

COMMERCE):

2l.688.0O9

?•>.104 nop

18.839.000

18.780,000

19 302.0"0

27

9,162.000

10,678.000

spindle hours per spindle in place Oct.

458.1

427.1

spindles

in

place

on

Oct.

P4VROMS—U.

AND

LABOR—REVISED

goods

27—

R.

■iTL
W

Monthly
exceed*

,

.7^

than

farm

indexes

12.397 000

*13 2c9 nco

13 4do,

*7,567.000

7.7">1.

5,686,000

.*5,732,000

5,719,.

108.2

*107.5

167.7

*165.3

17.184.0O0

(1947-49

17.079,000

Avge.=100)—

:

——

Average=100)—All
—:

,

of

employees

in

manufac¬

industries—

manufacturing
sroods

INSURANCE

—_—

q

—;

|W>

n

ww pop

7.263,000

7,313,000

$2,634,000

$2,858,000

goods

cent

w,wuora, mj.wv




tPrime

a

pound.

uarrcis

Western

17.006,(

9/761.
7,245,{

PITRonASERS—INSTITUTE

INSURANCE—Month

LIFE

toco's

of

Sept.

omitted):
——_

525.000

526,000

981,000

1.160.000

$4,140,000

$4,544,000

Industrial
-

Total

Month

OF
of

COMMERCE)

September

NEW

(millions

$2,34.5.0
537,
836.0

$3,718,"

SERIES—

of doliars):

Inventories—

*

102.9

*103.3

102.6

98.0

Durables

78.7

*79.8

80.5

72.4

Nondurables

Dec.

124.3

124.2

123.0

119.4

foods

ox

1^56* as asfiust Jan. 1, 1955 basis of
Plan.

Investment
one-half

475.6

7.701.000

—

2

(1947-49

number

Dec.

II

and

,512 O0O

of

workers)

—

goods

IIIIIIIIIIlDec.

;

_H
other

9

DEPT.

SERIES—MOnth

(production

indexes
manufacturing

(DEPT.

products

commodities

C09

MANUFACTURER'S INVENTnRIES AND SAI F.S

!

commodities

:

OF

-.

ioret»n

Zinc

crnue

runs.

125.828.319 tons.
sold

on

;jtsasea

on

new

annual

+Number of orders not

delivered

basis

at

centers

capacity

of

128,363.000

tc.,

;—

*$98,178

21,381

*21,357

.

*27,632

MONEY IN CIRCULATION—TREASURY DEPT.
As

of

Sept.

30

(000's

omitted)

$25 18

*$49,535

27,091

,

reported since introduction of
freight from East St. Louis

where

$28,701

$50.0P2

All

194,92

-

2.115

2.425

.2—2-2—

(DEPT.

216
:

pounds) —

1-;

115,5(59

662

——

(1.000

31

145,109
"157.352

OF

100):

Commodity Group—

Meats

112.781

192.955

2,307,202

Dec.

Total sales

99.994

—

-----——

387,470

—Nov. 17

^

foods

153.910

112,651

215.984

Ordinary

452,010

Nov. 17

sales

LIFE

OF

504.230

|

2,210,120

sales

=

112,850

703.430

36,080

Nov!

NEW

55,322

153 882

.

SPINNING

Durable

n0\\ 17

Total sales

Farm

808,022

r*"

.

__2_____

—

-2-.

^

turing
All

Nov. 17

Total round-lot transactions for account of members—
Total purchases

Processed

Oct.

Nondurable

47,400

—Nov. 17

(1947-49

2
31—2

316,502

bales)—

(1 000 - lb.

Nondurable

.

PRICES,

328,503

228,441

346,406

__-_2__

manufacturing

33,000

floor—

the

sales

—

170.721

249.060

2

1,109

Pavroll

Nov.

purchases
Short sales

LABOR

125,255.000

l^O.OIfi

-

31

manufacturing

AH

Nov. 17

:

.

initiated

Total

All

140,847.090

9'),:)77,0G0

i._-—

Emnloyment

Nov. 17

sales

WHOLESALE

69.433.OOp

124,424,000

153,014

Grab hot s.. etc.

Estimated

stiles

Other

101,282.000

■

—

Oct. '31

Durable

1,471,320

Nov. 17

..

sales

Short

2.23.47-7,090

October:
All

Nov.

sales

Other

Oct.

EMPLOYMENT

MEM¬

_Ncv. 17

transactions

157.521.000

549.780

.

ACCOUNT

sales

Other

152,131.000

197,188.000

(tons)

Spinning

.Nov!

,"l

:

transactions initiated

Total

Other

-

Spinning spindles active on Oct. 27--,
Active spindle hours (OOC's omitted) Oct.

Totql purchases
Short

155,640.000
226.P07.0O0

73,623.000

170.814

>

(tons)

Stocks

Active

Total sales
Other

96.275.000

165.478.0O0

2

31

Oct

STOCK

TRANSACTIONS

Nov.

TRANSACTIONS

Other

707.751

1,898,398

241,749,000

---

____2__——

2—-.

1.689 369

r^o.rno

1,108,180

269,249,000

2__..__-_—

2.

Oct.

1,273.820

147,953,000
2

_,2—

•

.

(running

COTTON

(SHARES):

purchases

Short

31—

.2-^12

(pounds)

(tons)

Prodi' eed

BERS, EXCEPT ODD-LOT DEALERS AND SPECIALISTS:
Transactions of specialists in stocks in which registeredTotal

Oct.

(tons)

Fibe r

Mo')es,
'

.

J-rUU

■•173»390

120.6

:

/

t tons)

Slocks

sales—

sales

sales

•

i 1 :

j.

-

721,835

1,148

sales

ROUND-LOT

177,750

-

1,959,273

dealers—

MEMBERS

106.7

122.7

-

1,225

1,107,578
$59,408,308

Nov. 17

1,572,928

31-2-2-1— __2_
(pounds) .,2^„^,„L--_^2__,
2'-_i

Produced

Hull

9,797

749,142

Nov. 17

ROUND-LOT
OF

117.0

168,138

1,117,375

7,683

905,213

sales

STOCK

ACCOUNT

Other

755,729

7,004

Nov.

round-lot

Short

912,896

752,606

sales

EXCHANGE
FOR
Total

759,690

Nov. 17

—

ROUND-LOT

128.7
.

2

——

Oct.

Meal—

Stocks
-

dealers—

by

shares—Total

Round-lot purchases by
Number of shares
TOTAL

17

__Nov. 17
.

sales

108.4

117.1
~

PROD-

2

.

Shipped
(tons)
-2,Hulls—2:„2

1.279,079

$57,470,360

Nov. 17

sales

Number

(20.5

123.0

_

(pounds)

and

I,inters

1,490,392
$77,141,062

Dollar value
Round-lot

134.0

108.5

T„....-__-__„;.___2—
Oct! 31-22--2—---'

(pounds)

Shinped
1,0)1,611

SEED

Oil—

Produced

53,691,886

(tons)

(pounds)

Stocks

.Nov.

sales

Customers'

f&les_

total

118.7

COMMERCE—Month of

(pounds)

^torks

by dealers (customers' sales)—

orders—Customers'

167.1

120.8
__

•

Consumption
Cake

107.17

.Nov. 17

—

126.6

173.0

134.1

:

COTTON

OF

(tons)

Produced

Dollar value
Odd-lot purchases

AND

mills

Produced

V,v ■■■ <H

Nov. 17

;

91.0

128.6

173.0

—

services

(tons)

Refined

SFCURITIES EXCHANGE COMMISSION:
dealers (customers' purchases)—t

shares

of

92.0

122.9
2—1

and

Produced

STOCK TRANSACTIONS FOR ODD-LOT ACCOUNT OF ODDLOT
DEALERS
AND
SPECIALISTS
ON
N.
Y.
STOCK

Odd-lot

118.4

132.6

,

recreation2~—

at

Stocks

286,921

36

—Dec.

-

99.5

126.0

92.1

-—^2.

Oil—

Crude

INDEX—

PRICE

2

106.0

99.6

Seed—

Stocks

408.f

252,372
1

—Dec.

—

109

=

2-2- .2—

■

Shipped

287.435

Dec.

activity.——1—

104 6

108.3

100.1

2--—-

SEED

October:

Stocks

(tohs)

Percentage

439.6

3.32

-

ASSOCIATION:

(tons)—a—

Production

120.1

106.5
•'

108.2

__„__2——

and

Crushed

3.42

—

INDEX

126,3
164.4

123.7

106.8

,_-2__^2

.--.'22

care

Received

3.69

Dec. 11

1

NATIONAL PAPERBOARD
Orders received

3.86
4.22

:

Group

COMMODITY

MOODY'S

3.96
4.32

—Dec. 11

Group

.2—-

130.5

103.3

124.2

i-.22—2-;

goods

Cotton

3.2)

3.72

3.97

4.35

Railroad

111.2

126.2-

UCTS—DEPT.

—

112.2

132.9

_

girls'

120.8
130.8

103 6
-__2___

care

Rending

2,87

.

corporate

oil

/___

-_2—

Medical

.

Average

113.9

122.5

133.4

108.70

3.32

115.4

112.0

apparel

Private

AVERAGES:

Bonds-

108.5

115.8

—

107.62

97.62

114.8

133.4

boys'a--

and

Personal

105.52

97.31
97.47

Dec. 11

_

and

Public

102.13

Dec. 11

fuel

operation

Transportation

107.27

91.34

100.9
107.5

'

109.24

96.54

11

Dec. 11

—

_.

YIELD

BOND

Government

S.

and

Women's

110.52

123.9

101.3
109.8

1.13.9

_

a—

Men's

COTTON

MOODY'S

109.4

126.6

100.8

^

borne

at

Apparel

167.97

100.49

—

110.8

111.7

110.7

Houspfurnishings

95.07

96.54

—

—

2

vegetables

Footwear

Dec. 11

Group
Utilities Group

fisn.._

electricity..^

Household

103.750c

90.91

Public

114.9

113.1

126.8

.

products

and

Solid

Not Avail.

98.73

Industrials

products

—--——C-—-—

Gas

13.500c

25.000c

100.49

A*1——III-———-——III——IIIII—IIII--I—III Dec!

117.1

-22.8

Rent

13.000c

13.500c

Dec. 11

.

3.715

2,086

1947-19-=10(>—

—

;

bakery
poultry and

5.622c

Other

-

Railroad

INDEX

and

$83.04

—————Dec. 11

corporate

Average

2.804

3,780

111.7

,

2,226

113.1

5.622c

Dec. 11

.

3.361

3,875

2,200

.

home

at

$63.04

AVERAGES:

Government Bonds

8.605

October:

5.622c

5
5
5

—Dec.

—

6.049

9.367

3,310

...

1.648

6.919

117.1.

PRICE

of

5
5

Dec.
Dec.
Dec.
Dec.
—Dec.

:i;—r

—

Louis)

(East St.

__

Housing

refinery at
—
Dec.
refinery -' at—Dec.

Lead

loens

2

$63.04

4
4
4

Domestic
:

7.025

1.758

9,385

^

items

Food

Electrolytic copper—
'■

13,246

7,497

••/■;

6,951

Food

270

QUOTATIONS):

J.

M.

&

27.968

14,533
■

1,781

Accounts

5
5
5

Dec.
Dec.
Dec.

lb.)

(per

loans

—

credit

Cereals

Pig iron (per gross ton)
Scrap steel (per gross ton)

$36 573

30,707

7,601

,

credit

Other

Finished

$40,074

30,811
14,473

modernization

payment

CONSUMER

12,047,

8

776

197

&

DUN

—

$40,196
_

'

Dec-

INDUSTRIAL)

443,304

31:

goods

loans

Charge
Service

COMPOSITE PRICES:

AGE

and

Personal

Month

AND

44,087 975

429,829,451

RE¬

.

consumer

Repairs

10,443,000

659,000

Dec,

INC

BRADSTREET,

96.679,762
;

credit,

credit

Automobile
Other

term

credit

Non-instalment

(in 000 kwh.)—

(COMMERCIAL

FAILURES

139,050,000

191,283,000

10,940,000

FEDERAL

intermediate

of 'Oct.

as

consumer

168,082,000

187,533,000

INSTITUTE;

ELECTRIC

EDISON

millions

112,932,000

207,186,000
116,123,000

DEPARTMENT STORE SALES INDEX—FEDERAL RESERVE
SYSTEM—194t-4» AVERAGE — 100
Dec.

457,683,352

THE

OF

and

Instalment

$281,014,000

——
..Dec.
———pec.

lignite (tons)
(tons)

short

$330,333,006

$377,118,000
189,585,000

OF MINES):

anthracite

Pennsylvania

72,251,619

City—

SYSTEM—REVISED SERIES- Esti¬

mated
in

S323,309,000

Dec.

construction

$529,934,971

————

York

GOVERNORS

Total

Dec.
Dec.
Dec.

construction

Private

I

2

„

City

New

SERVE

ENGINEERING

—

construction

S.

U.

_____

CONSUMER CREDIT OUTSTANDING—BOARD

NEWS-RECORD:

Total

York

Outside

OF

freight loaded (number of cars)
Dec.
freight received from connections (no. of cars)—Dec.

Revenue

i2-

■—__

-----

Total United States__—_

New
.

ASSOCIATION OF AMERICAN RAILROADS:
Revenue

Central

8,350,000

175,401,000

—I———2—

Central

West

2 312,006

13,779,000

South

$20,708,000

$30,757,000

19.(

27.22

Volume

184

Number

5594

.

.

The Commercial and Financial
Chronicle

.

(2615)
In

underwriting:

indicated

quiry
pect

circles

it

was

preliminary

that

building

in¬

for

up

this

bonds

with

warrants

attached

added to the fund's

were

pros^

of decidedly
encouraging:
proportions.
was

debentures,

shorter

with

their

than

Ordinary maturity,
interest rate and are
100 ttpis offering a yield

priced at
that

attracts

rr,u

,

.

secondary
markets

and

peared

be

to

directions.

This

lssue^

or

so

ago,

holding

wee^

ap-

; in

.

for

however,

mean,

yields

On

staged

Patman's
tee

higher

market.

hearings

the

in

against

Board's

threats
time
trme

of

CHI
an

stand¬

Federal

These

advocates

fight

Mean-

modest

nnn

.

the

&

for

up

kiTl

block

J

As

t?

market,

having

Tl lf Z

on

to

a

in

1012199

for

5Vi%

a

interest

t

thP
the

not

rminH

always the
to take

pays

New

...

This

ited

rate

Issues

of

a.10-4

n^v

T

Science
offer¬

new

Co.

and

4%%

a

-

.

ported

.,

better than

Meantime,
Power's

■

,

,

half

5672,063

*.

78% from

or

and

Investor

priced

"ated

from--,Science &
Northspan

5.10%

reported

to

to

The

from

buying

return

been

firms,

and

which

smaller

other

.

pirgt

was

of

come

fiduciary

.

T-.

.

date

year

marketing
..

.

ic

cieoeniures,

,
„

,

^

today,
"

via

of

the

At

will

the

lUoth
from

dividend

(17lie)
Five

of

gain

(5c)

declared

ness

payable

December

on

which

be

the

14,

to

and

the

on-

aL

the

or

Trustee,

R$NK,

date

AND

company

board

busi¬

Common

York

4

one

directors

twelve

15,

have

cents

1957

of

also

December
JOSEPH

December

6,

declared

a

dividem

(12c) per share payable Janu
stockholders of record at th

to

business

31,

S.

1956.

STOUT,

Secretmr

1956.

Packing Company
Deeember 7,

1956

COMMON DIVIDEND No. 322
a

50$

the

on

share

per

were

New

York

&

Honduras

120

Broadway, New York 5,

the
The

Board

NO.

Y.

12,

1956

417

of

Directors
of
this
Company
at a Meeting held
this day,
declared a divi¬
dend
of
One
Dollar
and
Seventy-five cents
($1.75) per "share on the
outstanding capita
stock, ..payable on January 3,
1957,
to stock¬
holders of record at the
close of business
or
December 21,
1956.
This
distribution is th*
final rdividend for the
year
1956.

stockholders of record at the close
of business December 14, 1956.

Secretary

G.

-T

N.

December
DIVIDEND

to

H. B. Pierce,

Rosaric

Mining Company

de-

stock of

common

5L J

E.

McDANIEL, Secretary-Treasurer.

^
SUPERCRETE

fcf

ST.
GENERAL

4<\

TIME

(^

of

is

GENERAL

TIME

CORPORATION

on

OF

hereby

Directors
and

given

that
a

quarter

Common

in

respect

been

MAN.

DIVIDEND

declared

has

one

the

company
have not

LTD.,

BONIFACE,

NOTICE

Notice

eight

share

a

i

share

the

Boari

dividend

cents

(S.OS'/i)

o

pe

Capital stock of thi
of

waived,

which

dividend

payable

1957 to shareholders of record
of business
December

January
at

the

Transfer
J.

Dividend

books

E.

will

not

DUMAS,

be

closed.

Secretary-Treasurer

The Board of Directors has de-

clajed
share

a

on

as

dividend of 50 cents per
the common stock, pay¬

able

.January 2, 1957 to share¬
holders of record Decemb^R: 18,

Raleigh.

after

the

that
SECU¬

North

Car-

ROCKFISH

RAILROAD
incorporated

October

Vice

President

NOTICE

of

directors

of

record

a

the
at

of

.

Storage

The

Files

Board

28th

.

ing

of

close

Safes

Rotary,

.

.

the

,

.

$1.75

Preferred

of record

J.

of

Diebold,
held

November,

per

has

quarterly
share

Stock

on

payable

December
V.

14, 1956.

STEVENS,

Secretary

on

INTERNATIONAL

on

1956,

SHOE

the outstand¬

shares of the corporation
(20c) per share, pay¬

December

able

the

at

31,

1956

office

of

share¬

to

^ri-Qoantimntai

dividend

the

jU/ COMPANY

Transfer

it. «.r>ui»

December

on

further

17,

1956.

payable in

com¬

corporation at the
(l/10th) of a com¬

for each

share

common

share

of

by the Board, payable Jan¬

16,

1957

to

shareholders

the Transfer

Agent

on

Jan¬

2, 1957.
Board

and

share

office

Final Quarter Dividends

Ccmmon Stock

60

has

one-eighth cents
upon

shares

of

December

quarterly

on

(28V8C)

at

Agent

share payable

1, 1957

60ff

on

January

ord

at

to stockholders of

1,

the

the

December

close

of

clared

14, 1956,

business
was

67 V2 cents

share

STOCK

a

share

on

the

$2.70 PREFERRED STOCK

de¬

Payable January
Record

ANDREW W. JOHNSON

Date

1,

December

1957
11,

1956

Kenneth H. Chalmers

Vice-Pretidenl and Treasurer

President

Secretary
Decemb«f 3,

N 402-DI

a

Payable December 24, 1956

by the Board of Directors.

KOONTZ

cents

the COMMON

rec¬

on

1956.
RAYMOND

on

of

pre¬

January

preferred shareholders of
Transfer

dividend

de¬

also

all outstanding

payable

the

21,

A

per
Directors

of

Company

of

the close of business at the

at

Diversified Closed-End
Investment

CONSECUTIVE DIVIDEND

corporation outstanding has been

record at the close of business

business

A

I33*D

shares of the

clared the regular dividend of twenty-

per

payable

of

Directors

Flo film

.

meeting

a

of

dividend

a

common

eight

of

7%

of

regular

.

of twenty cents

The

of

dividend

MOTORS

Vertical

.

.

Directors

at

day

declared

uary

Products

the

Microfilming Cameras and Processors

uary

Corporation,
the

HAYD0N

Vault Equip¬

Fire-resistive

.

and Visible Record Fifes

record

dividend

Board

declared

RECORDERS

January 2, 1957, to stockholders
.

office of

Allied

quarterly

r

DIVIDEND NOTICE

the

DIVIDEND NO. 75

BEN

THOMAS

STR0MBERG

mon

23, Michigan

declared

SETH

holders of record at the close of busi¬

12, 1SS6

BIG

•

The

Canton 2, Ohio

A

shares

WAGNER BAKING
CORPORATION

WESTCL0X

INCORPORATED

of

1956

1

clos*

15,.* 1956.

Secretary
RronHwav. New York (>. N. Y.

f,5

1956.




The
of

Treasurer.

meeting of the Board of Dire<t'
held this day, a quarterly divi'
d'£nd of 25^ per share and an extra

share

a

Manufacturers of Bank

NOTICE

of

corporation,

shareholders

of

per

Secretary

Tmsiee
cn
Dec.
n,
1956.
on
interest
shall
cease, to
accrue

ABERDEEN

Detroit

the

of

MICHEL,

The Garlock

Kenneth H. Chalmers

„

CORPORATION

1956,

W.

($1.17)

on

close

Record Date December 4, 1956

1957 to all

28,

close

CLIFFORD

Payable December 24, 1956

ferred

share

Cents
dividend of

December 5, 1956.

•<v.

per

on

of
at
record
the
December 31,
1956.

on

day

(in Canadian Funds)
January 30, 1957, to

shareholders

Street, New

dollar and saventeei
share has been declared
the
the Corporation's
capital stock payabli
December 24, 1956 to
stockholders of record a
the
close
of
business December
14,
1956.
I
is
expected
that
approximately
one
dolla
($1.00) per share of this
special dividend wil
be
designated as a
"capital gain
dividend,'
pursuant
to
the
provisions
of
the
Interna
Revenue Code.
cents

One-haif
extra

an

share

NOTICES

1956.

thereon.

COMMON

December

and

plus

per

Wall

A special dividend

investments

on

$1.03

/

declared

1956,

14

1956

157

RAILROAD

ALLIED PRODUCTS

Michigan

NO.

Seventeen

share

per

Cents

were

investment income

net

the

of

DIVIDEND

29,

Fourth.

NATIONAL SHARES
CORPORATION

meeting of the Board of Directors of
Dome Mines Limited, held this
day, a quarterly

Quarterly

27 cents

.

mon

a

at

Dividend

ness

November

Locust

formerly with Shearson

DIVIDEND

LIMITED

Consecutize

-

Curtis,

was

to

Paine, Webber, Jack¬

tors,

5%%

If srafdem,?S„S
redeemed

office

NATIONAL

Dated:

J.

&

son

He

a

A Diversified Mutual Fund

rate of one-tenth

on

MINES

will

Nuclear

Uranium

ROCKFISH

nego-"' By: Forrest Lockey,

AlllEb

the staff of

last

Don¬

—

repre¬

who

Corporation

Incorporated,

DIVIDEND

40c

firm

Broad Street Investing

Agent

On

DOME

Thomas A. Baxter

are

office

for'
ior

tiated route.

Corporation,

of

BEACH, Calif.

Bretting has been added

Hammill & Co.

meetings is
Piatt, of Boston, a part¬
Vance, Sanders & Com¬

o'ina, at par and acijued interest to redemption
date.
All such bonds are required to be prescnted for payment and redemption at said

,

the

at

RITY

glafpd
siatea

is

and

date

Corp.'s $40 million of 20-

rlphpntlirP-5

vpar

had

approximately

Company, payable December 28,1956,

ment

m

....

~

mission

Boston,

ald R.

the

of

elimi-

27—40—49—59—64—74

corporate
.

LONG

and

DIVIDEND NOTICES

dividend of

year

„•%*£•

units

i

largest

~

pf

of

Wilshire

formerly with

& Co.

(Special to The Financial
Chronicle)

month.

clared

^

to

insurance

undertaking, Texas Eastern Trans.

assets

Boston

Other partners and

Juiy 1, 1915, between, the undersigned and the
Security National Bank ^ Greensboro, Raleigh,
of
North Carolina, Trustee, there have been drawn
by lot for redemption and it is the' intention
of
the
undersigned
to
pay
and
redeem
on
December
17,
1956, $6,000.00 principal amount
of the above described bonds,
bearing Nos.

1,-1.

weeks
,

net

$1,435,000,000 at the close

At

the provisions of the Deed of Trust dated

.

,

total

Fund

3115

was

Paine, Webber Adds

Growth

General

Mortgage Three and One-Quarter Per Cent

NQTICE

Good Demand Foreseen

,

of

company
Incorporated

,

.

the

AND

attracted by the terms.

were

The-

director

a

DIVIDEND NOTICES

snapped

continued

host of

a

Bond

Co.,

John H. Schmidt

5y4%

maturity,

have

Investors

&

Dempsey-Tegeler

principal

Canada

Fund,

10

the

at

REDEMPTION NOTICE

quickly.

up

of

-

ABERDEEN

to

are

Vance,

Fund, Century Shares Trust

dur-

a

were

Fund.

Pacific

a

which

Rich¬

—

Dillon, Union

ary

ne*t

<mocc

1

sold.

carrying

*

President

&

Voltage Engineering

.

30-year- bonds,
COUpOn

Massachusetts
Stock

ANGELES, Calif.

Boulevard. He

underwriters, which also ijiclude

©ffering of $3 million of
,

Carter, III,

December

Chairman

"1956.

j

11%

rose

re•

.

Sierra

for

DIVIDEND

speaker

and

Nqclear Fund assets
30, T9j36 were $1,549,081

Nov.

up

coupon

priced to yield 4.30%.was

,

A.

Securities

Fund.

ings appeared to be going to inag0. For the s|me period, net asm good
style, with liberal set value'
per'share rose from
yields giving a fillip to demand.;
$10.23 to; $11.11, an increase- of
Florida .Power & Light Co. a $1d
s.6%. ; During-.November,
Coinmillion of 30-year, first mortgage bustion
Engineering
and
High
carrying

tables"

opening
session on Thursday morning will
be
Theodore T.
Miller, of New
York, President of the Polymer

vestors

bonds,

"round

1956*

30

LOS

ard M. Fischer has
been added to
the staff of Eastman

compared

on Jan.

mc*

funds

each.

Guest

an

1

Stev¬

Distribution from realized

Moving

corporate

12

persons

ing the same period. The net asset value Per share increased from

look.

second

to

increase.of
,1% for toe period. Outstanding

on

Latest

represents

(Special to The Financial
Chronicle)

Henry Parkman III, of

Sanders & Company

year
in
Boston,
Chicago,
Cleveland, St. Louis and
New
York
City, participation in the
case history solutions will be lim¬

sentatives

19f)6 shows total

B.

With Eastman Dillon

of

this

reporting

$1 758 930.82

wi(h $1 587 893.91

sometimes it

case,

a

.investors

30

f

asset

J lLn
So, ZTp
while

«/

pi
go-round.

first
first

similar meetings
investment deal¬

and their salesmen held earlier

pany.

ny

117

page

shares of the fund

i*

h?
in

f Nov

as

gnf

WH

and

cofnbination of appre¬
the. market value of se-

Sovereign

turned

w

other

for independent
ers

curities in thqtfund's portfolio and
sales of new shares to investors.

sought only $3
making its second

was

with

Mutual Funds

-The coast utility

'np

13

of

Valentine,

Angeles.

The

The

Tuesdaj.

million, but

Dec.

on

14.

participate

utility

bids

tel, New Orleans,

Richard

-j

ieal, that of Sierra Pacific Power
was

,

'• 1

7nnnnn

^

Continued |?ora

assets

,

to sell
mutual funds at the Roosevelt Ho¬

ner

ciation

Co., which

.

,

„

following day.

ding

public

^<f«7

pa

^

The better general tone marketwise found reflection in the bid¬

small

^

but

firming of yields on the
more recently marketed
offerings
with
those carrying coupons
of
4% or better naturally making the
more
impressive showing.

a

.

seminar

&

further

for

....

its
ways

Chemicals Division of W. R. Grace

opposite tack.

been

Atlantic Coast Line's

sound

^rStZ,H

"soft-money"
auit-mmicy

the

has

11(_

slated.

are

are

present

on

7

off

of
ui

took

There

to

inflation.

new

^

softening of

any

efforts

array
anay

the^ensuing

trust issues

Martin,

the
fortnight,

up

guns.

William 'McC.

new

up

cleaning
any unsold portions of several
"rights'"7 offerings, namely Bur¬
roughs Corp., 'Libby, McNeill &
Libby and National Cash Register,
only a few railway equipment

the

contrary,

forces

of

lie clamping

Aside from the task of

Reserve Board Chairman, went on
as

let-

will

program

noten-

as

purchasers

shutters for

sub-Commit¬

opposing

ing by their

record

the

the

course

Reason al

Darti

securities will

Congressman

by

economic

found

the

Qf

prospective

not

there has been any change
basic factors which have been

money

new

to

,

does

making

•

down

wj^ch looms for the

ahead.

most

that
in

fare

sparse

bond

Massachusetts

Investors Trust, Boston Fund and
mutual
investment
com¬

since the

6me

of Los

other

panies,

s|)ell

a

market

the corporate

in

new

week

a

It's quite

j

rm*run(issue

nuwhich developed

btfyers.

Slendet Calendar

;

for

Haussermann,

Nashville; and John

Vance, Sanders & Co., principal
underwriters

H.

Kimball

and

enson

In New Orleans

carry a 5 J/2%

Arthur

Washington, D. C.; Alec

Vance Seminar

■

The

and

holdings. Boston;

119

65

Broadway. New York 6, N. Y.

The Commercial and Financial Chronicle ; ;.

120

Thursday, December 13,195

genial it

was

Welfare

BUSINESS BUZZ

than

of

job.

on...

Under

Secretary
preceding

Mr.

Folsom

when he
the

A

Capital

from the Nation'*

JLJL

\/ g^ -m m

g]

ym

JL

i/\A/

m

who

V%/

taxes

purposes,

lowered.

said,

he
to

came

will
and

possibility

Peb.

prior to the expiration
of the Taft-Hartley Act

12

injunction

prices

of the Eisenhower Adminis¬

one

be

-

just

going to
little lamb what

a poor

y

and may or may

Republicans are genuine "mod¬
ern
Republicans" and deserve
the
full
confidence
of
such

tee

reported

leader,"

"world's

and

the

so

co¬

af-

...

well

up

mobile

as

week

.v'

- .v.'

-

Confirmed

in

a

;

r

confirmed

the

that

come

benefit

i

to the

strike.

labor

must be

solving their (Middle East)
real economic problems so
that their peoples may rise from
very

the

a

depths of poverty and dis-

ease," the Vice-President stated.
Incidentally, this correspond¬
ent

project cold in the Senate.

ization, has turned over to the
Department of Labor the com¬
plete job of planning how to
handle manpower utilization,
^wage control, and the enforce¬

Western

This

that

means

sal

wars

justice and
perpetuity,

in

will

an

in¬

the

the peace
framework

secure

the

molded

be

by

as

Labor

the

by

that

an

Europe,

in

aid

to

be

in¬

would

Middle

a

East

settle¬

consequence

a

and

ment

financial

as

Department boys, who have a
strong and long reputation of
favoritism to
organized labor.

j

fast to beat

move

the official announcement when

cal

care

Money is set forth implicitly
by the Eisenhower Administra¬
tion
as
not
only a universal
for

world

aid

Ibasis,

program

long

so

only

were

Federal

aid,

are

more

built

and

another

800

is

bill

pass.

nurses

prophesy means that if in
spite of the revolving buttocks

15 years.

10 to

>

foreign

policy

.

Russia

toward

second
from Red

(constantly turning the
buttocks

to

of

kicks
while

exposure

sort

one

other

the

or

another

through
smarting), there is a war, the
set-up of "stabilization" will be
pitched heavily for organized
labor, as under Truman and
Roosevelt's

wars

gets

peace

time.

At

noon

of the

day when Vice-President Nixon,
was

telling the automobile

peo¬

ple in New York how American
money

tions

would solve the disloca¬

in

Britain

and

help

end

poverty in the Middle East. Ma¬
rion Folsom, Secretary

fare,
Press

was

telling

Club

how

the

of Wel¬

National
the

generous

Federal Government is in

also.

same

health,

New

Projects

construction of medical research

facilities

Eisenhower Ad¬
always
expands

(the

programs

initial

once

add

this

on

Folsom also out¬
lined some of the major objec¬
tives of the Eisenhower Admin¬
the

health, welfare,

and educational fields for

lation
are

in

The

1957.

legis¬
highlights

summarized:

(1)

the

also

wants

to

provision

program

insisted

Mr.

at

American

Fol¬

this aid

grams

(6) Federal grants for aiding

solving the problems of

states in

juvenile delinquency.

Texas

of

the

curiosities

of the

distribution

of

petroleum

and

products, is that it is likely to
lead to a still greater surplus
of

stocks

of

gasoline,

now

al¬

ready much larger than normal.
in

For

for

to

Europe the U.

duce

more

more

loss

order

in

and

get

more

oil

S. will pro¬
order

to

get

heating oil to counter the
this country of residual

to

oil diverted
cannot

to

Europe, refiners

escape,

oil

people

say,

of
Investme
Association
annu

professional wel¬
fare worker gets Federal funds
to extend the scope of his work,
som,

when

a

this

apparently has no influence
in easing the rftan's job or build¬
ing up his personal status and
This

was

Folsom

apparent

how

much

Statler

(White

Hilto

Sulphur

Investment Bankers Associatio

Spring

meeting

at

the

Greer

brier Hotel.

Sept. 25-27, 1957

(Santa Barbar

Cai.)
Investment Bankers Associatio
Fall

Meeting at Santa

Biltmore.

•

Barbar

•

,

1957

(Hot Springs, Ya

National Security Traders Ass
ciation
Annual
Convention

the Homestead.
Dec.

1-6, 1957

(Hollywood Beac

Annual

Convention

HolL

at

wood Beach Hotel.

Oct.

29-Nov.

3,

1958

(Colon

Springs, Colo.)
National Security Traders As
ciation
Annual Convention
the Broadmoor.

when Mr.

his Press

told

dience

the

at

Investment Bankers Associatio

Fol¬

Club

more

au¬

con-

TRADING MARKETS

Botany Mills
A. S.

Spending Now Highest

Campbell Co. Com.
Fashion Park

Highlights
of
the
Welfare
Secretary's speech follow:
(1)

While

grant in full

Congress
a

did

request for

a

budget boost for such activities
this year,

"the level of Federal

activities in these fields today is
higher than ever before."

(2)

More than 9 million

Indian Head Mills

United States Envelope

not
24%

Morgan Engineering

?o^lG

National Co.

Carl Marks
FOREIGN

per¬

sons now

receive monthly social

security

checks,

three

out

of

five

which

go

retired

to

per¬

boosting still higher the produc¬

Benefits amount to almost
S6 billion annually and the full

tion of gasoline.

impact of the SS




Group

Springs, Va.)

welfare, and educational aids.
One

Associatio

Fla.)

Surplus Gas

entire disruption of the world's

(Chicago, 111.)

Bankers

Conference.

Nov. 3-6,

undefined pro¬
for aiding older persons.

pay.

program.

however,

Associ

anniversary dinne
the King Edward Hotel.

teaching fa¬

Further

(5)

The Federal aid to school

construction
som,

Traders'

25th

Mar. 18-20, 1957

the

says

amounts

Mr.

to

it gets them in
Folsom

modest

books).

In the view of Secretary

Secretary

istration in

ation

(Toronto, Canada

Bond

May 8-11, 1957

Expansion of the present
3-year, $90-million program for

Comfortable Job

problems,

but also for the domestic ills of

th

Hotel.

"

This

8, 1957

Toronto

meeting

Aid

and engineers.

at

April 21-23, 1957 (Dallas, Tex.)

for construction of

expand the supply of
and public health doctors

Chicag

11th National Jnstalment Cred

cilities for doctors.

to

of

party

of the Federal Office of

Administration

under construction or

planned.

ing

March

(4)

with

Club

Hotel.

Bankers

next

the past decade more
been

Sheraton

pects will double or triple in the

$1

Souther

(Chicago, 111.)

winter

cation, which the Secretary ex¬

2,000 hospitals and health
have

viewpoint,

construction

school

ministration

centers

"needs"

a

1956

Traders

annual

the Administra¬

(3) Recommendations are ex¬

million.

In

on

28,

Bond

pected in 1957 for "higher" edu¬

million. Sixteen

they

ago

years

as

there

Education.

for the needy.

amount to $180

Since

(2) Expansion in various pro¬

program

(8) The government is aiding
6,000 student and teaching
scientists this year and is help¬

Ointment

is
important existing Fed¬

unlikely to

medical research alone now

Teacher

new

an

eral

the

York

New

as

money.

the National Institutes of Health

for

for

foreign aid come any
problem in world affairs.

Federal

the

of

(6) Federal appropriations for

are

ointment

causes

per

a

suggesting

even

states

such

grams

Government will be prepared to
shell out large sums of money

Universal

time"

first

has begun,
V which in a few years time will
I reach $100 millions of expendi¬
tures annually, to provide medi¬
A

(5)

than

to

basis,

tion insists upon this

poverty," and is helping to train
welfare personnel.

(7)

fairs that occurred there.

One has

the

"for

"underlying

the

re¬

of af¬

predicting that the United States

case
to win univer¬

agency,

with recent

r

if sta¬

even

bilization is operated

dependent

volved

of war.

case

well

as

of the Office of Defense

ment thereof in

Nov. 29,

on

week

one

add program for the Middle, East

Director
Mobil¬

Fleming,

S.

only

predicted

previously,
Labor Plans for M-Day

Arthur

aid

generous

in

Harry in righteous anger

bill to draft labor into
the Army.
Just as quickly the
late Senator Bob Taft stopped
the

into

"There

persuaded the House quickly to
pass

searching

is

rather than

probably did not need a cent of
not

Dinner at

Hotel.

states

the

among

"needs"

a

that

Federal

from

government

The

(4)

and of Britain.

overcame

in 1946, when
pulled its big

Truman

Harry

railroad

years

public assistance payments, for
the
aged, 'blind,
dependent
children, and the disabled.
J \

financial aid of the Middle East

emotion

virtuous

four

past

on

capita

persons

Vice-Presi-

United States would

exactly the same kind of

Just
a

the

in

(3) Some 5 million additional

York

New

tonight,

ago

dent Nixon

:y~ :

-

people

you

Jan.

addressed the auto¬

When he

Haven't

patience?"

of

dispersed

be

to be felt. Benefits have almost

to

doubled

Two Aid Programs

piers and in ware¬

on

houses.

Winter

virtue

of the

heard

ever

shocked!

I'm

Gentlemen,

"Frankly,

pre¬

legally

(Baltimore, Md.)

Baltimore Security Traders As
sociation
22nd
Annual
Mid

alone.

goods

trade

ordinary

as

pile

Europe

to

beneficences

of

Associatio

Conferenc

Jan. 18, 1957

undertake this job.

shiploads

things at home, while

unable

been

have

world
control

to

unable

being

as

(Chicago, 111.)

Bankers

9th National Credit

would

committee

this

vailed

dam-

to be shown before the

as

1957

American

Committee of the
FPSC which is diverting tank¬
ers, re-aligning the oil trade of
the world, and otherwise mak¬
ing it possible to alleviate the
oil shortage in Western Europe.

aging; to the self-respect of the
chief of state of a world's leader

:

Jan. 14-16,

Supply

Petroleum

Foreign

If Mr. Celler's ideas had

nothing:

is

there

(Philadelphia, Pa.

Emergency

fairs.
For

1957

10,

clay Hotel.
is

Committee. It is the Middle East

operating with Russia to thwart
the evil designs of the French
and the British, and otherwise
playing god in international

multi¬

the

committees

these

of

One

with the labor
off ocean shipping at the very time this nation
was
demonstrating that it was

Field

Investment

Philadelphia Securities Associa
tion annual meeting at the Bar

evil

an

as

hurt

to

Jan.

tudes.

to be most angry

the

committees

mechanism

boys for shutting
.

views.}

(D., N. Y.)

Commit¬
kill off in¬

did his best to

dustry

organized labor.

Mr. Eisenhower was

In

of the House Judiciary

the

as

own

EVENTS

Production

up

Emanuel Celler

man

r

not coincide wit

the "Chronicle's"

for renewal in the
last session of Congress, Chair¬
was

who

devoted

COMING

When the Defense

Act

Taft-Hartley Act, to show that

citizens

all

were

Saved

Committee

project is to see if it
really can't be done this time,
this business Of debilitating the

other

;pretation from the nation's Capit
-

is reported.

it

sure,

That pet

bosses of

the

people

fleet the "behind the scene" inte

lost its way.

public-spirited

On

the

Immediately heating oil will
be under the most price pres¬

tration's pet projects is

to

,

lowered gasoline
the fate of a short
of

in

him

axes

[This column is intended to

to offset the '

tend

will

or

unselfishly to the help of others.

price#

in

world oii situation.

strike,

this

against

this

crude

course,

considerably

rise

dispute between the longshoremen and
the shippers is
settled

V,

of

Eventually,

WASHINGTON, D. C.—Unless

to

him at the Welfare

see

Department
the

that

Treasury all

came

grind. They wanted to get their
hand,

*

observed

in the

was

people

had selfish

Behind-the-Scene Interpretation

to be Secretary of

Treasury, his

the

sons.

system is yet

SECURITIES

50 BROAD STREET

TEL:

HANOVER 2-0050

•

&

Co. Inc.

SPECIALISTS

NEW YORK 4, N. Y.

•

Riverside Cement

Sightmaster Corp.

LERNER & CO.
Investment

Securities

TELETYPE NY 1 971

10 Post Office

Square, Boston 9, Mass.

Telephone

Teletype

HUbbard 2-1990

BS 69